HIGH COURT OF AUSTRALIA NORTHERN TERRITORY OF AUSTRALIA APPELLANT AND MR A. GRIFFITHS (DECEASED) AND LORRAINE JONES ON BEHALF OF THE NGALIWURRU AND NUNGALI PEOPLES & ANOR RESPONDENTS COMMONWEALTH OF AUSTRALIA APPELLANT AND MR A. GRIFFITHS (DECEASED) AND LORRAINE JONES ON BEHALF OF THE NGALIWURRU AND NUNGALI PEOPLES & ANOR RESPONDENTS MR A. GRIFFITHS (DECEASED) AND LORRAINE JONES ON BEHALF OF THE NGALIWURRU AND NUNGALI PEOPLES APPELLANT AND NORTHERN TERRITORY OF AUSTRALIA & ANOR RESPONDENTS Northern Territory v Mr A. Griffiths (deceased) and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples Commonwealth of Australia v Mr A. Griffiths (deceased) and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples Mr A. Griffiths (deceased) and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples v Northern Territory [2019] HCA 7 13 March 2019 D1/2018, D2/2018 & D3/2018 ORDER Matter Nos D1/2018 and D2/2018 Appeal allowed in part. Set aside Order 2 of the Orders of the Full Court of the Federal Court of Australia made on 9 August 2017 and, in its place, order that: "(1) Paragraph 3 of the further amended order made by the trial judge dated 24 August 2016 be set aside and, in its place, order: 'The compensation payable to the native title holders by reason of the extinguishment of their non-exclusive native title rights and interests arising from the acts in paragraph 1 above is: compensation for economic loss the sum of interest on (a) in the sum of $910,100; for cultural loss the sum of compensation Total: $2,530,350. Note: post-judgment interest is payable on this total under s 52 of the Federal Court of Australia Act 1976 (Cth), accruing from 25 August 2016.' (2) Delete order 9." Matter No D3/2018 Appeal dismissed. On appeal from the Federal Court of Australia Representation S L Brownhill SC, Solicitor-General for the Northern Territory, with T J Moses for the Northern Territory of Australia (instructed by Solicitor for the Northern Territory) S A Glacken QC with G A Hill and L E Hilly for the Ngaliwurru and Nungali Peoples (instructed by Northern Land Council) S B Lloyd SC with N Kidson for the Commonwealth of Australia (instructed by Australian Government Solicitor) P J Dunning QC, Solicitor-General of the State of Queensland, with A D Keyes for the State of Queensland, intervening (instructed by Crown Solicitor (Qld)) the Attorney-General of C D Bleby SC, Solicitor-General for the State of South Australia, for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor's Office (SA)) G T W Tannin SC with C I Taggart for the Attorney-General for the State of Western Australia, intervening (instructed by State Solicitor's Office S J Wright SC with M Georgiou for the Central Desert Native Title the Yamatji Marlpa Aboriginal Corporation, Services Limited and intervening (instructed by the Central Desert Native Title Services) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Northern Territory v Mr A. Griffiths (deceased) and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples Commonwealth of Australia v Mr A. Griffiths (deceased) and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples Mr A. Griffiths (deceased) and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples v Northern Territory Aboriginals – Native title rights – Assessment of compensation – Where "previous exclusive possession act[s]" within meaning of s 23B in Div 2B of Pt 2 of Native Title Act 1993 (Cth) ("NTA") extinguished non-exclusive native title rights and interests held by Ngaliwurru and Nungali Peoples ("Claim Group") – Where Claim Group entitled to compensation under Div 5 of Pt 2 of NTA – Whether economic loss and cultural loss assessed separately – Principles of assessment for compensation for economic loss – Whether economic value of Claim Group's native title rights and interests equivalent to freehold value of affected land – Whether reduction from freehold value appropriate and how calculated – Whether inalienability of native title rights and interests a relevant discounting factor – Principles of assessment for compensation for cultural loss – Whether trial judge erred in assessment of cultural loss – Whether award manifestly excessive – Whether award met community standards. Interest – Whether simple or compound interest payable on award for economic loss – Upon what basis simple interest payable. Words and phrases – "compensable acts", "compensation", "compound interest", "compulsory acquisition", "cultural loss", "discount", "easement", "economic loss", "exclusive native interests", "extinguishing act", "inalienability", "just terms", "manifestly excessive", "native title", "non- economic loss", "non-exclusive native title rights and interests", "objective economic value", "percentage reduction from full exclusive native title", "previous exclusive possession act", "simple interest", "solatium". title rights and Constitution, 51(xxxi). Lands Acquisition Act (NT), Sch 2. Native Title Act 1993 (Cth), Pts 1, 2, 15. Racial Discrimination Act 1975 (Cth), s 10. KIEFEL CJ, BELL, KEANE, NETTLE AND GORDON JJ. These appeals1 concern the amount of compensation payable by the Northern Territory of Australia to the Ngaliwurru and Nungali Peoples ("the Claim Group")2, pursuant to Pt 2 of the Native Title Act 1993 (Cth), for loss, diminution, impairment or other effect of certain acts on the Claim Group's native title rights and interests over lands in the area of the township of Timber Creek in the north-western area of the Northern Territory. The issues are extensive, and some respects complex, but fundamentally there are three questions: how the objective economic value of the affected native title rights and interests is to be ascertained; (2) whether and upon what basis interest is payable on or as part of the compensation for economic loss; and how the Claim Group's sense of loss of traditional attachment to the land or connection to country is to be reflected in the award of compensation. For the reasons which follow, those questions should be answered thus: the objective economic value of exclusive native title rights to and interests in land, in general, equates to the objective economic value of an unencumbered freehold estate in that land. In these appeals, the objective economic value of the non-exclusive native title rights and interests of the Claim Group is 50 per cent of the freehold value of the land; interest is payable on the compensation for economic loss, and in the circumstances of this case, on a simple interest basis, at a rate sufficient to compensate the Claim Group for being deprived of the use of the amount of compensation between the date at which compensation was assessed and the date of judgment; and 1 From a judgment of the Full Court of the Federal Court of Australia (North A-CJ, Barker and Mortimer JJ): Northern Territory v Griffiths (2017) 256 FCR 478 allowing in part appeals from a judgment of Mansfield J (Griffiths v Northern Territory [No 3] (2016) 337 ALR 362). 2 Griffiths (2016) 337 ALR 362 at 366 [13], 376 [71(4)]. Bell Nettle Gordon the compensation for loss or diminution of traditional attachment to the land or connection to country and for loss of rights to gain spiritual sustenance from the land3 is the amount which society would rightly regard as an appropriate award for the loss. The appropriate award for the cultural loss in these appeals is $1.3 million. These reasons are in seven parts: facts4; claim for compensation5; legislative framework6; economic loss claim7; interest on the economic loss claim8; cultural loss9; and orders10. Facts Timber Creek is a tributary of the Victoria River situated in the north- western corner of the Northern Territory. The area was first explored by non- Aboriginal people in the mid-nineteenth century and, around the end of that century, a number of pastoral leases were granted in the Victoria River district11, including one pastoral lease granted in 1882 over the area that now comprises the town of Timber Creek12. The town, which was proclaimed as such in 1975, is located on the Victoria Highway about halfway between Katherine and 3 Referred to as "non-economic loss" or "solatium" in the courts below and by the parties in their appeal grounds but, for reasons to be explained later in this judgment, better expressed as "cultural loss". 4 Part A, paras [5]-[10]. 5 Part B, paras [11]-[18]. 6 Part C, paras [19]-[54]. 7 Part D, paras [55]-[107]. 8 Part E, paras [108]-[151]. 9 Part F, paras [152]-[237]. 10 Part G, paras [238]-[239]. 11 Griffiths (2016) 337 ALR 362 at 368 [23]-[24]. 12 Griffiths v Northern Territory [2014] FCA 256 at [41]-[42]. Bell Nettle Gordon Kununurra13 and covers an area of approximately 2,362 hectares14. It is bounded on the north by the Victoria River and on the east, south and west by Aboriginal land granted under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth). It has a population of approximately 230 people, some two thirds of whom identify as Aboriginal; principally, native title holders. The principal buildings, apart from houses, are a road-house and general store, a hotel and caravan park, local council offices, a police station, a primary school, and a health clinic. The town's economy is centred on tourism and associated services and regional service delivery15. Compensable acts Between 1980 and 17 December 1996, the Northern Territory was responsible for 53 acts, on 39 lots and four roads within the town, comprising various grants of tenure and the construction of public works, which were later held to have impaired or extinguished native title rights and interests and which give rise to the Claim Group's entitlement to compensation under Pt 2 of the Native Title Act ("the compensable acts"). Twenty-two of the compensable acts were grants of development to effect improvements in exchange for freehold title. The remainder of the acts consisted of a grant of a Crown lease, freehold grants to government authorities on which, in some cases, public works were later constructed, and public works constructed without any underlying tenure16. The total area of land affected by the compensable acts was approximately 127 hectares ("the application area"), comprising just over 6 per cent of the area previously determined to be land in relation to which native title exists. incorporating covenants leases History of claims In 1999 and 2000, the Claim Group17 instituted three proceedings under the Native Title Act for determination of native title to land within the boundaries 13 Northern Territory v Griffiths (2017) 256 FCR 478 at 484 [7]. 14 Griffiths (2016) 337 ALR 362 at 370 [33]. 15 Griffiths (2016) 337 ALR 362 at 369 [29], [32]. 16 Northern Territory v Griffiths (2017) 256 FCR 478 at 485-488 [10]-[11]. 17 The claimant group found to have held native title is now the compensation Claim Group: Griffiths (2016) 337 ALR 362 at 366 [13]; see also at 376 [71(4)]. Bell Nettle Gordon of the town18. The trial judge (Weinberg J) held19 that the Claim Group had native title rights and interests comprised of non-exclusive rights to use and enjoy the land and waters to which s 47B of the Native Title Act applied in accordance with their traditional laws and customs. On appeal, the Full Court of the Federal Court (French, Branson and Sundberg JJ) varied20 his Honour's determination, holding in relation to those parts of the determination area to which s 47B applied that the Claim Group's native title rights and interests comprised a right to exclusive possession, use and occupation, but otherwise affirmed Weinberg J's determination. The total area of land determined to be subject to exclusive native title was approximately 2,053 hectares. On 2 August 2011, the Claim Group instituted a claim for compensation under s 61(1) of the Native Title Act in respect of the compensable acts21. The compensation application concerned an area wider than that the subject of the determination, and included specified areas within the town where there had been no determination that native title existed. The parties were agreed, however, that native title existed in relation to the application area at the time of the act or acts for which compensation was claimed22. By a statement of agreed facts, the parties adopted the terms of the Full Court's native title determination as a description of the native title potentially affected by the compensable acts23. As a preliminary issue, the trial judge (Mansfield J) determined that the historic grant of pastoral leases was effective at common law to partially extinguish native title to the application area and that, in compensation proceedings as opposed to the proceedings for the determination of native title, 18 Griffiths v Northern Territory (2006) 165 FCR 300 at 305 [8]-[10]. 19 Griffiths v Northern Territory (2006) 165 FCR 300 at 369 [703]-[705], 370 [716], 20 Griffiths v Northern Territory (2007) 165 FCR 391 at 428 [125], 429 [128]. 21 Griffiths (2016) 337 ALR 362 at 366 [7], 370 [37]-[40]. 22 Griffiths [2014] FCA 256 at [11]-[12], [16]. 23 Griffiths (2016) 337 ALR 362 at 367 [18]. Bell Nettle Gordon s 47B of the Native Title Act, being inapplicable, did not permit the common law extinguishment of exclusive native title to be disregarded24. Native title rights and interests Accordingly, Mansfield J found25 that the native title rights and interests affected by the compensable acts consisted of the following non-exclusive rights exercisable in accordance with traditional laws and customs of the Claim Group: the right to travel over, move about and have access to the application area; the right to hunt, fish and forage on the application area; the right to gather and use the natural resources of the land such as food, medicinal plants, wild tobacco, timber, stone and resin; the right to have access to and use the natural water of the application area; the right to live on the land, to camp, and to erect shelters and structures; the right to engage in cultural activities, to conduct ceremonies, to hold meetings, to teach the physical and spiritual attributes of places and areas of importance on or in the land and waters, and to participate in cultural practices related to birth and death, including burial rights; the right to have access to, maintain and protect sites of significance on the application area; and the right to share or exchange subsistence and other traditional resources obtained on or from the land and waters (but not for commercial purposes). 24 Griffiths [2014] FCA 256 at [43], [46], [67]. 25 Griffiths (2016) 337 ALR 362 at 376 [71(3)]. Bell Nettle Gordon Claim for compensation The claim for compensation was framed, pursuant to s 51(4) of the Native Title Act, in terms that compensation for loss, diminution, impairment or other effect on native title of the compensable acts should consist of the following elements: compensation for economic loss of the native title rights and interests to be determined as if the effect of each compensable act was equivalent to the compulsory acquisition of an unencumbered freehold estate in the subject land; compound interest at the superannuation rate or alternatively on a compound "risk free rate" of yields on long-term (10 year) government bonds or alternatively simple interest at the Pre-Judgment Interest Rate fixed by the Federal Court of Australia Practice Note CM16 ("the Practice Note rate") on the amount of compensation awarded for economic loss to be computed from the date as at which the compensation is assessed until judgment or payment; and compensation for loss or diminution of connection or traditional attachment to land and intangible disadvantages of loss of rights to live on and gain spiritual and material sustenance from the land, to be assessed by adaptation of the criteria in Sch 2 rr 2(b) (special value) and 9 (intangible disadvantage) of the Lands Acquisition Act (NT), to be assessed as at the time of trial. Trial judge The trial judge assessed26 compensation in the amount of $3,300,661 comprised as follows: compensation for economic loss to be assessed at the date at which native title is taken to have been extinguished under the Native Title Act and assessed as being 80 per cent of the unencumbered freehold value of the affected land, namely, $512,40027; 26 Griffiths (2016) 337 ALR 362 at 446 [466]. 27 Griffiths (2016) 337 ALR 362 at 395-396 [172], 404-405 [232], 446 [466]. Bell Nettle Gordon interest payable as part of compensation for economic loss on a simple interest basis calculated at the Practice Note rate from time to time and computed from the date of extinguishment of native title until judgment, being a sum of $1,488,26128; and compensation for non-economic $1.3 million29. loss payable the amount of Full Court The Full Court varied30 the trial judge's assessment of economic loss from 80 per cent of the unencumbered freehold value of the affected land as at the date of extinguishment to 65 per cent of the unencumbered freehold value as at that date but otherwise, relevantly, affirmed the trial judge's decision. Accordingly, the orders of the trial judge were varied to award the Claim Group $416,325 for economic loss and $1,183,121 in interest on that sum, with the total compensation award being $2,899,446. Appeals to this Court By grants of special leave, the Claim Group, the Northern Territory and the Commonwealth each appeal to this Court. The Claim Group appeal on two grounds, being in substance that: the Full Court erred in assessing the Claim Group's economic loss at 65 per cent of the freehold value of the subject land and should have assessed it as being the freehold value of the land without reduction; and the Full Court erred in awarding interest only on a simple interest basis computed at the Practice Note rate and should have allowed interest on a compound basis computed at the risk free rate. 28 Griffiths (2016) 337 ALR 362 at 407 [246], 408-409 [254], 413 [279], 446 [466]. 29 Griffiths (2016) 337 ALR 362 at 416-417 [298]-[300], 433 [383], 446 [466]. 30 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [139], 590 [468]. Bell Nettle Gordon The Northern Territory appeals on grounds in substance that: the Full Court erred in rejecting the valuation methodology advocated by one of the valuers who gave evidence, Mr Wayne Lonergan, or alternatively, in assessing the Claim Group's economic loss at any more than 50 per cent of the unencumbered freehold value as at the date of extinguishment; and the Full Court erred in affirming the trial judge's assessment of compensation for non-economic loss in the amount of $1.3 million by: failing to approach the assessment as an award given as consolation or solace for distress consequent upon a loss for which no monetary value can be put; upholding the trial judge's erroneous reliance on the effects of one compensable act on a nearby ritual ground to support a finding that some other, unidentified compensable acts had a collateral detrimental effect on native title beyond the land on which those other, unidentified compensable acts occurred; failing to apply a causation analysis consistent with ss 23J and 51(1) of the Native Title Act, by upholding the trial judge's erroneous reliance on the compensable acts as part of an overall erosion of connection to country; and failing to find that the award for non-economic loss was manifestly excessive. And the Commonwealth appeals on grounds in substance that: the Full Court's assessment of the Claim Group's economic loss at 65 per cent of the freehold value of the subject land was erroneous or manifestly excessive and should not have exceeded 50 per cent; the Full Court erred in not holding that the trial judge was in error in awarding interest under s 51(1) of the Native Title Act as part of compensation rather than as interest on compensation; the Full Court erred in upholding the trial judge's assessment of non- economic loss in the amount of $1.3 million because they: Bell Nettle Gordon included a component relating to the capacity to conduct rituals on adjacent land not the subject of compensable acts despite the fact that on the facts as found by the trial judge there was no effect on that capacity which was an "effect of" a compensable act within the meaning of s 51(1) of the Native Title Act; included a component for a "sense of failed responsibility for the obligation under traditional laws and customs to have cared for and looked after the land" despite there being no evidence that the Claim Group experienced any such feelings over all of the land the subject of the compensable acts and, to the extent that there was evidence that they did experience such feelings, their feelings were the result of a pre-existing absence of a recognised right to control access to the land rather than the "effect of" the compensable acts within the meaning of s 51(1) of the Native Title Act; included a component for the purported effect of compensable acts on future descendants of the Claim Group despite the Native Title Act not conferring an entitlement to compensation on persons who would have become members of the Claim Group only after native title had been extinguished; failed to find that the trial judge did not consider the geographical extent of the areas of land over which the compensable acts took place in comparison to the overall area of land available to the Claim Group to exercise and enjoy their rights as "native title holders" within the meaning of the Native Title Act and as "traditional owners" under the Aboriginal Land Rights (Northern Territory) Act; and found that commercial agreements entered into by the Claim Group, which contained agreed, minimum, solatium-type payments for damage to or destruction of sacred sites, had no relevance to the assessment of compensation; and the Full Court erred in failing to hold that the assessment of $1.3 million was manifestly excessive, because they: applied the wrong test by asking whether the sum was substantially beyond the highest figure which could reasonably have been awarded, when the correct test was to ask whether the sum was a wholly erroneous estimate of compensation; Bell Nettle Gordon failed to consider the upper limit of a sound discretionary judgment for an award of compensation for non-economic loss; wrongly had regard to decisions of the Inter-American Court of Human Rights in breach of the rules of natural justice and erroneously found that those decisions validated the sum awarded when they were incapable of doing so; and (d) wrongly had regard to a 2002 discussion paper entitled "How Can Judges Calculate Native Title Compensation?", in breach of the rules of natural justice. The Commonwealth contended that the sum awarded for non-economic loss should have been in the order of $230,000. The Attorneys-General for the States of South Australia, Queensland, and Western Australia, and the Central Desert Native Title Services Limited and the Yamatji Marlpa Aboriginal Corporation were each granted leave to intervene. Legislative framework It is necessary to begin by examining and considering the provisions of the Native Title Act31. The Native Title Act recognises, and protects, native title32 and provides that native title is not able to be extinguished contrary to the Native Title Act33; any extinction or impairment of native title can only be in accordance with the specific and detailed exceptions which the Native Title Act prescribes or permits34. 31 Yorta Yorta Aboriginal Community v Victoria (2002) 214 CLR 422 at 440 [32]; [2002] HCA 58, citing The Commonwealth v Yarmirr (2001) 208 CLR 1 at 35 [7]; [2001] HCA 56 and Western Australia v Ward (2002) 213 CLR 1 at 65-66 [16]; [2002] HCA 28. 32 Native Title Act, s 10. 33 Native Title Act, s 11(1). 34 Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373 at 463; [1995] HCA 47. Bell Nettle Gordon The scheme of the Native Title Act reflects the context in which it was enacted – it operates upon native title rights and interests defeasible at common law but substantially protected against extinguishment, from 31 October 1975, by the Racial Discrimination Act 1975 (Cth)35 and, in particular, s 10(1) of that Act36. "Native title" or "native title rights and interests", elaborately defined in s 22337, comprise a number of elements, all of which must be given effect38. Section 223(1) provides that the expression "native title" or "native title rights and interests" means: "the communal, group or individual rights and interests of Aboriginal peoples or Torres Strait Islanders in relation to land or waters, where: the rights and interests are possessed under the traditional laws acknowledged, and the traditional customs observed, by the Aboriginal peoples or Torres Strait Islanders; and the Aboriginal peoples or Torres Strait Islanders, by those laws and customs, have a connection with the land or waters; and the rights and interests are recognised by the common law of Australia." 35 Native Title Act Case (1995) 183 CLR 373 at 453. 36 Section 10(1) of the Racial Discrimination Act provides that "[i]f, by reason of, or of a provision of, a law of the Commonwealth or of a State or Territory, persons of a particular race, colour or national or ethnic origin do not enjoy a right that is enjoyed by persons of another race, colour or national or ethnic origin, or enjoy a right to a more limited extent than persons of another race, colour or national or ethnic origin, then, notwithstanding anything in that law, persons of the first-mentioned race, colour or national or ethnic origin shall, by force of this section, enjoy that right to the same extent as persons of that other race, colour or national or ethnic origin." 37 Ward (2002) 213 CLR 1 at 65 [15]. 38 Yorta Yorta (2002) 214 CLR 422 at 440 [33]. Bell Nettle Gordon As that definition provides, the rights and interests of Aboriginal peoples39 may be "communal, group or individual". The rights and interests must be "in relation to land or waters" and have three characteristics: that they be possessed under the traditional laws acknowledged and the traditional customs observed by the Aboriginal peoples concerned40; that, by those traditional laws and traditional customs observed by those Aboriginal peoples, those peoples have a connection with the land or waters41; and that the rights and interests be recognised by the common law of Australia42. The first and second of those characteristics – that native title is a bundle of rights and interests possessed under traditional laws and customs and that, by those laws and customs, Aboriginal peoples have a connection with the land or waters – reflect that native title rights and interests have a physical or material aspect (the right to do something in relation to land or waters) and a cultural or spiritual aspect (the connection with the land or waters). As the plurality in this Court said in Western Australia v Ward43: "The question in a given case whether [s 223(1)](a) is satisfied presents a question of fact. It requires not only the identification of the laws and customs said to be traditional laws and customs, but, no less importantly, the identification of the rights and interests in relation to land or waters which are possessed under those laws or customs. These inquiries may well depend upon the same evidence as is used to establish connection of the relevant peoples with the land or waters. This is because the connection that is required by par (b) of s 223(1) is a connection with the land or waters 'by those laws and customs'. Nevertheless, it is important to notice that there are two inquiries required by the statutory definition: in the one case for the rights and interests 39 The definitions of "native title" and "native title rights and interests" relate to the rights and interests of both Aboriginal peoples and Torres Strait Islanders: see Native Title Act, s 223(1). 40 Native Title Act, s 223(1)(a). 41 Native Title Act, s 223(1)(b). 42 Native Title Act, s 223(1)(c). 43 (2002) 213 CLR 1 at 66 [18]. Bell Nettle Gordon possessed under traditional laws and customs and, in the other, for connection with land or waters by those laws and customs." (emphasis in original) Not only is native title recognised and protected in accordance with the Native Title Act44 and not able to be extinguished contrary to the Native Title Act45, but if native title is extinguished, then the Native Title Act provides for compensation. As the Preamble to the Native Title Act records46, Aboriginal peoples and Torres Strait Islanders have been progressively dispossessed of their lands, largely without compensation, and the enactment of the Native Title Act was intended to rectify the consequences of past injustices. The provisions of the Native Title Act are intended to secure the adequate advancement and protection of Aboriginal peoples and Torres Strait Islanders and to ensure that they receive the full recognition and status within the Australian nation to which history, their prior rights and interests, and their rich and diverse culture, fully entitle them to aspire. The Preamble goes on to state: "[j]ustice requires that, if acts that extinguish native title are to be validated or to be allowed, compensation on just terms … must be provided to the holders of the native title". The system established by the Native Title Act to address, in a practical way, the consequences of acts impacting native title rights and interests is complex. That complexity arises because the Act seeks to deal with concepts and ideas which are both ancient and new; developed but also developing; retrospective but also prospective. It arises because the Native Title Act requires the just and proper ascertainment and recognition of native title rights and interests; that certain acts that extinguish native title rights and interests are to be validated or allowed; that, where appropriate, native title should not be extinguished, but should be revived after a validated act ceases; and that, where native title rights and interests are extinguished, compensation on just terms is to be provided. As has been seen, there are different categories of compensable acts in issue, and those acts took place at different times. The statutory source of the 44 Native Title Act, s 10. 45 Native Title Act, s 11(1). 46 See also Acts Interpretation Act 1901 (Cth), s 13(2)(b). Bell Nettle Gordon entitlement to compensation, and the consequences that flow from validation of an act, depend on the category of act, and whether the act was a past act, an intermediate period act or a previous exclusive possession act within the scope of Divs 2, 2A and 2B of Pt 2 of the Native Title Act. Hence, the categorisation of the act and the timing of the act are both relevant. Turning first to past acts, they are addressed in Div 2 of Pt 2 of the Native Title Act. A past act is, relevantly, an act which occurred before 1 January 199447 when native title existed in relation to particular land, which act was invalid (apart from the Native Title Act) to any extent but would have been valid to that extent if native title did not exist48. In short, a past act is a pre-January 1994 act which is invalid because of the existence of native title. There are four categories of past act. A category A past act relates to a grant of certain freehold estates, a grant of certain leases and the construction of certain public works49. A category B past act relates to a grant of certain leases50. A category C past act relates to the grant of mining leases51 and a category D past act is one that is not a category A, B or C past act52. The classification of an act affects the impact of the act on native title. Category A past acts, relevantly, extinguish native title and category B past acts extinguish any native title to the extent of any inconsistency53. The non-extinguishment principle applies to category C and D past acts54. Where the non-extinguishment principle applies, the Native Title Act does not extinguish 47 The commencement date of the Native Title Act: see Native Title Act, s 4(3)(a). 48 Native Title Act, s 228. 49 Native Title Act, s 229. 50 Native Title Act, s 230. 51 Native Title Act, s 231. 52 Native Title Act, s 232. 53 Native Title Act, s 15(1)(a)-(c). 54 Native Title Act, s 15(1)(d). Bell Nettle Gordon native title but native title may be suspended wholly or in part to take account of the act55. Putting the categories aside, the classification of an act as a "past act" determines the validation mechanism in respect of that act. In the present appeals, all but five of the acts were past acts within the meaning of s 228 of the Native Title Act. Those past acts were attributed to the Northern Territory56 and were validated on 10 March 1994 by s 19 in Div 2 of Pt 2 of the Native Title Act and s 4 of the Validation (Native Title) Act (NT). Both of those provisions, in their terms, provide that a past act is valid and is taken always to have been valid. That validation perfected, or made absolute, the compensable acts and removed any restriction by which the acts had no validity as against the native title holders. In short, validation effected a clearing of the native title rights and interests from the freehold title57. Separate to past acts are "intermediate period acts". In these appeals, the remaining five acts were intermediate period acts. Intermediate period acts58 are acts which, relevantly, occurred between 1 January 1994 and 23 December 1996, where native title existed in relation to particular land, which acts were invalid (apart from the Native Title Act) to any extent but would have been valid to that extent if native title did not exist. Division 2A of Pt 2 of the Native Title Act deals with validation of intermediate period acts59. The intermediate period acts were validated on 1 October 1998 by s 22F in Div 2A of Pt 2 of the Native Title Act and s 4A of the Validation (Native Title) Act (NT). There is a further relevant category of acts, being "previous exclusive possession acts". Division 2B of Pt 2 of the Native Title Act, headed 55 Native Title Act, s 238. 56 See also Native Title Act, s 239. 57 cf Griffiths v Minister for Lands, Planning and Environment (2008) 235 CLR 232 at 283-284 [181]; [2008] HCA 20. 58 Native Title Act, s 232A. Intermediate period acts are also classified into four categories – category A, B, C and D: Native Title Act, ss 232B-232E. 59 Inserted into the Native Title Act following Wik Peoples v Queensland (1996) 187 CLR 1; [1996] HCA 40, handed down on 23 December 1996. See Native Title Amendment Act 1998 (Cth), Sch 1, item 9. Bell Nettle Gordon "[c]onfirmation of past extinguishment of native title by certain valid or validated acts", deals with previous exclusive possession acts. Section 23B of the Native Title Act provides that a previous exclusive possession act is, relevantly, a grant made before 23 December 1996 which was validated under Div 2 or Div 2A of Pt 2 of the Native Title Act (thereby confirming that certain validated past acts and intermediate period acts were validated). Thus, both past acts and intermediate period acts may be previous exclusive possession acts. The important distinction to bear in mind is that acts to which the non-extinguishment principle applies are not previous exclusive possession acts60, a point to which it will be necessary to return. The majority of the compensable acts in these appeals61 were previous exclusive possession acts within the meaning of s 23B of the Native Title Act. Validation of a previous exclusive possession act results in extinguishment of native title62. The previous exclusive possession acts in these appeals, attributable to the Northern Territory, extinguished native title63. The exceptions were category D past acts within the meaning of s 232 of the Native Title Act. These acts were not previous exclusive possession acts, because the non-extinguishment principle applied to these acts64. However, all but three of the category D past acts65 were followed by subsequent previous exclusive possession acts affecting the same lots which extinguished native title 60 Native Title Act, s 23B(9B). 61 Except for acts 1, 3, 15, 17, 19, 21, 23, 25, 27, 29, 36 and 41. As to the nature of each of the compensable acts, described by reference to act numbers, see Northern Territory v Griffiths (2017) 256 FCR 478 at 485-487 [10]. 62 Native Title Act, s 23E. 63 Native Title Act, s 23E and Validation (Native Title) Act (NT), ss 9H and 9J. 64 See [31] above. 65 Acts 1, 36 and 41 remained category D past acts to which the non-extinguishment principle continued to apply. 66 By operation of Native Title Act, s 23E and Validation (Native Title) Act (NT), ss 9H and 9J. Bell Nettle Gordon Section 23J in Div 2B of Pt 2 of the Native Title Act provides that native title holders are entitled to compensation in accordance with Div 5 for any interests. extinguishment under Div 2B of Accordingly, by operation of s 23J in Div 2B, in relation to the compensable acts which were previous exclusive possession acts67, the native title holders were entitled to compensation in accordance with Div 5 for the extinguishment of their native title rights and interests by each act. title rights and their native For the category D past acts which were not followed by subsequent previous exclusive possession acts68, the native title holders were entitled to compensation under s 20 in Div 2 of Pt 2 of the Native Title Act, which, in turn, provides that they are entitled to compensation under s 17(1) or (2) on the assumption that s 17 applied to those category D past acts. Section 17, by its terms, applies only to acts attributable to the Commonwealth. However, when read with s 20(1), s 17 is to be read and applied as if it covered acts attributable to the Northern Territory. Relevantly for the purposes of these appeals, s 17(2) provides, under the heading "[n]on-extinguishment case": "If it is any other past act [other than a category A or category B past act], the native title holders are entitled to compensation for the act if: the native title concerned is to some extent in relation to an onshore place and the act could not have been validly done on the assumption that the native title holders instead held ordinary title any land concerned; and the land adjoining, or surrounding, any waters concerned; or ..." (emphasis added) These appeals were conducted on the basis that the date of validation of all acts was 10 March 1994. After established, the compensation payable under Div 2, 2A, 2B, 3 or 4 of Pt 2 of the Native Title compensation has been entitlement 67 All acts except for acts 1, 36 and 41. 68 Namely, acts 1, 36 and 41. Bell Nettle Gordon Act in relation to an act is payable only in accordance with Div 569. As has been seen, the compensation payable to the Claim Group arises under either Div 2 or Div 2B of Pt 2 of the Native Title Act, and accordingly, s 51(1) applies in relation to determining the compensation claims in these appeals. Section 51(1) is the core provision. It provides that: "Subject to subsection (3), the entitlement to compensation under Division 2, 2A, 2B, 3 or 4 is an entitlement on just terms to compensate the native title holders for any loss, diminution, impairment or other effect of the act on their native title rights and interests." (emphasis added) Specific aspects of s 51(1) must be recognised at the outset. It is the native title holders – relevantly, the person or persons who hold the native title70 – who are entitled to compensation on just terms. And those native title holders are entitled to compensation for any loss, diminution, impairment or other effect of the act on their native title rights and interests. Relevantly, an act71 is an "[a]ct affecting native title"72 if it extinguishes the native title rights and interests. The Native Title Act does not expressly provide the date upon which the entitlement to compensation arises, or the date on which the value of the native title right and interest being extinguished is to be determined. However, as the entitlement to compensation is for the "act" itself73 and the validation provisions deem the extinguishing act to be valid and always to have been valid from the time of the act74, the date for the assessment of the compensation is the date of the act. 69 Native Title Act, s 48. 70 Native Title Act, s 224. 71 Defined in Native Title Act, s 226. 72 Defined in Native Title Act, s 227. 73 Native Title Act, s 51(1). 74 Native Title Act, ss 19 and 22F and Validation (Native Title) Act (NT), ss 4 and 4A. Bell Nettle Gordon Next, s 51(1), in its terms, recognises the existence of the two aspects of native title rights and interests identified in s 223(1) to which reference has already been made – the physical or material aspect (the right to do something in relation to land) and the cultural or spiritual aspect (the connection with the land) – as well as the fact that the manner in which each aspect may be affected by a compensable act may be different. Both aspects are addressed in terms by s 51(1) providing for an entitlement on just terms to compensation to the native title holders for "any loss, diminution, impairment or other effect of the act on their native title rights and interests" (emphasis added). Section 51(1) thus recognises that the consequences of a compensable act are not and cannot be uniform. The act and the effect of the act must be considered. The sub-section also recognises not only that each compensable act will be fact specific but that the manner in which the native title rights and interests are affected by the act will vary according to what rights and interests are affected and according also to the native title holders' identity and connection to the affected land. As the trial judge held, s 51(1) does not in its terms require that the consequence directly arise from the compensable act. The court's task of assessment under s 51(1) is to be undertaken in the particular context of the Native Title Act, the particular compensable acts and the evidence as a whole. Section 51(2) then addresses acquisition of native title rights and interests under compulsory acquisition law. Section 51(3) deals with an act which is not the compulsory acquisition of all or any of the native title rights and interests of the native title holders but which satisfies the "similar compensable interest test". That test is satisfied if, in relation to a past act, an intermediate period act, or a future act, the native title concerned relates to an onshore place and the compensation would, apart from the Native Title Act, be payable under any law for the act on the assumption that the native title holders instead held ordinary title to any land or waters concerned and to the land adjoining, or surrounding, any waters concerned75. None of the compensable acts in these appeals falls within either s 51(2) or (3). Where neither s 51(2) nor (3) applies, s 51(4) provides that if there is a compulsory acquisition law for the Commonwealth (if the act giving rise to the entitlement is attributable to the Commonwealth) or for the State or Territory to which the act is attributable, the court, person or body 75 Native Title Act, s 240. Bell Nettle Gordon making the determination of just terms may, subject to s 51(5)-(8)76, in doing so have regard to any principles or criteria set out in that law for determining compensation. Here, there was such a law – the Lands Acquisition Act (NT). Section 51A provides that, subject to s 53, the total compensation payable under Div 5 for an act that extinguishes all native title in relation to any particular land or waters must not exceed the amount that would be payable if the act were instead a compulsory acquisition of a freehold estate in the land or waters. Section 53 provides that where the application of any of the provisions of the Native Title Act in any particular case would result in a s 51(xxxi) acquisition of property of a person other than on s 51(xxxi) just terms, the person is entitled to compensation as is necessary to ensure that the acquisition is on just terms. Section 53 is a shipwrecks clause77. Section 51A provides a cap on compensation by providing that the total compensation payable under Div 5 for an act that extinguishes all native title in relation to particular land or waters must not exceed the amount that would be payable if the act were instead a compulsory acquisition of a freehold estate in the land or waters. The statutory recognition in s 51(1) that the two aspects of native title rights and interests – the economic value of the native title rights and interests and the non-economic value of those rights and interests – are to be compensated assists in understanding the work to be done by s 51A of the Native Title Act. As the Commonwealth submitted, those two aspects of native title rights and interests inform the operation of s 51A. When introducing s 51A as part of the 1998 amendments to the Native Title Act following this Court's decision in Wik Peoples v Queensland78, Senator Minchin said79 that the "underlying premise of the Native Title Act is to equate native title with freehold for the purposes of dealing with native title" and 76 Subject to a request for non-monetary compensation, the compensation may only consist of the payment of money: s 51(5) and (6). 77 A clause directed to ensuring the constitutional validity of the compensation provisions in Div 5: see, eg, Cunningham v The Commonwealth (2016) 259 CLR 536 at 552 [29]; [2016] HCA 39. 78 (1996) 187 CLR 1. 79 Australia, Senate, Parliamentary Debates (Hansard), 3 December 1997 at 10231. Bell Nettle Gordon the cap "should reflect the compensation payable if native title amounted to freehold". Under the general law, the compensation for the compulsory acquisition of land comprises the freehold value of the land as well as compensation for severance, injurious affection, disturbance, special value, solatium or other non-economic loss80. Consistent with equating native title rights and interests with freehold for the purposes of compensation, s 51(2) and (4) of the Native Title Act refer to the fact that the court, person or body making the determination of compensation on just terms may have regard to any principles or criteria set out in a compulsory acquisition law for the Commonwealth, or for the State or Territory to which the act is attributable81. Those various acquisition laws address the non-economic aspect of the compensation in different terms. It is important, however, not to allow words like "solatium" in land acquisition statutes, or cases about those statutes, to deflect attention from the nature of the rights and interests that have been acquired and the compensation that must be assessed to provide just terms for their acquisition. Asking what would be allowed as "solatium" on the acquisition of rights that owe their origin and nature to English common law distracts attention from the relevant statutory task of assessing just terms for the acquisition of native title rights and interests that arise under traditional laws and customs which owe their origins and nature to a different belief system. The label "solatium" is also distracting in another way. What the Native Title Act requires to be compensated is the cultural loss arising on and from the extinguishment of native title rights and interests. Given that the Native Title Act is a Commonwealth Act which, under Div 5, equates native title rights and interests to freehold for the purposes of dealing with native title, and is intended 80 See, eg, March v City of Frankston [1969] VR 350 at 355-356; Marshall v Director General, Department of Transport (2001) 205 CLR 603 at 622 [33]-[34]; [2001] HCA 37. 81 See generally Lands Acquisition Act 1994 (ACT), s 45; Lands Acquisition Act 1989 (Cth), s 55; Land Acquisition (Just Terms Compensation) Act 1991 (NSW), s 55; Lands Acquisition Act (NT), Sch 2; Acquisition of Land Act 1967 (Qld), s 20; Land Acquisition Act 1969 (SA), s 25; Land Acquisition Act 1993 (Tas), s 27; Land Acquisition and Compensation Act 1986 (Vic), s 41; Land Administration Act 1997 (WA), s 241. Bell Nettle Gordon to provide compensation for the extinguishment of those rights and interests on just terms to all native title holders affected by a compensable act, ss 51 and 51A are to be read as providing that the compensation payable to the native title holders is to be measured by reference to, and capped at, the freehold value of the land together with compensation for cultural loss. Principles or criteria set out in a compulsory acquisition law for the Commonwealth, or for the State or Territory to which the compensable act is attributable, may be of assistance but they are not determinative of the issues arising under s 51(1). Economic loss claim The Claim Group are entitled to compensation on just terms for any loss, diminution, impairment or other effect of a compensable act on their native title rights and interests. In order to assess the value of the affected native title rights and interests, it is necessary first to identify the date on which the value is to be assessed and then the nature of the affected native title rights and interests. The date on which the value is to be assessed was not in dispute before this Court. Following a relevant holding from the trial judge82, the matter was conducted on the basis that the economic value of the Claim Group's native title in the application area fell to be determined according to the rights and interests actually held by the Claim Group as at the date that their native title to the land was taken to have been extinguished by the compensable acts. The reason for adopting that approach was that, under the "rules for the assessment of compensation" for compulsory acquisition of land in Sch 2 to the Lands Acquisition Act (NT), each person having an estate or interest in land which is compulsorily acquired has a separate and independent claim to compensation for the value of the interest that is taken from him or her by the acquiring authority83. As was earlier observed, s 51(4) of the Native Title Act the determination of the court, person or body making provides compensation on just terms may have regard to such rules or principles. that In identifying the nature of the Claim Group's native title rights and interests it assists to begin with the approaches adopted by the trial judge and the Full Court. 82 Griffiths (2016) 337 ALR 362 at 395-396 [172]. 83 Lands Acquisition Act (NT), s 59. See Rosenbaum v The Minister (1965) 114 CLR 424 at 430-432; [1965] HCA 65. Bell Nettle Gordon Trial judge As has been noticed, the trial judge assessed the economic value of the native title rights and interests as being 80 per cent of freehold value. His Honour described84 that assessment as an "intuitive decision, focusing on the nature of the rights held by the [C]laim [G]roup which had been either extinguished or impaired by reason of the [compensable] acts in the particular circumstances" and which reflected "a focus on the entitlement to just compensation for the impairment of those particular native title rights and interests". As it appears from the trial judge's reasons for judgment, there were four principal considerations that informed his conclusion. The first was that, in his Honour's view85, it was artificial to focus on the amount which a willing but not anxious purchaser would have been prepared to pay for the native title rights and interests which were affected by the compensable acts, because the native title rights and interests were incapable of alienation and thus could not be sold or transferred to anyone other than the Northern Territory or, possibly, the Commonwealth. Likewise, in his Honour's view, it was artificial to focus on the amount for which the Claim Group would have been willing to sell the native title rights and interests. It followed, according to his Honour, that the "conventional valuation approach expressed in Spencer[86] ... seems inappropriate". The second was that, in his Honour's view87, it was inappropriate "simply to proceed on the basis of a comparison of the bundle of rights held by the [Claim Group], remote from their true character, for the purposes of assessing the extent to which they might equate to, or partially equate to, the bundle of rights held by a freehold or other owner or person having an interest in land" – although his Honour added88 that he was careful in making his assessment not to include any allowance for the elements related to the cultural or ceremonial 84 Griffiths (2016) 337 ALR 362 at 405 [233]. 85 Griffiths (2016) 337 ALR 362 at 402 [211]. 86 Spencer v The Commonwealth (1907) 5 CLR 418; [1907] HCA 82. 87 Griffiths (2016) 337 ALR 362 at 402 [212]. 88 Griffiths (2016) 337 ALR 362 at 405 [234]. Bell Nettle Gordon significance of the land or the Claim Group's attachment to the land, which fell to be assessed separately. The third was that, having regard to the express purposes of the Native Title Act and the recognition of Aboriginal peoples as the original inhabitants of Australia, his Honour considered89 that it would be wrong to treat native title rights and interests in land as other than the equivalent of freehold, at least in the case of exclusive native title rights and interests, or to treat the economic value of exclusive native title rights and interests as other than equivalent to the economic value of freehold interests. In his Honour's view, the inalienability of the native title rights and interests did not constitute a significant discounting factor. For as his Honour conceived of it, that appeared to be "the undebated premise" in Amodu Tijani v Secretary, Southern Nigeria90 and Geita Sebea v Territory of Papua91. The fourth was that, although the subject native title rights and interests were inalienable and so not transferable, the trial judge considered92 that they existed as a real impediment to any further grants of interest in the land, and, more generally, were in a practical sense "very substantial" and "exercisable in such a way as to prevent any further activity on the land, subject to the existing tenures". The trial judge, however, rejected the Claim Group's contention that their non-exclusive rights and interests should be valued as if they were exclusive. His Honour also rejected the notion that compensation on just terms for the extinguishment of non-exclusive native title rights and interests should be assessed on the basis that upon extinguishment the Crown acquired radical or freehold title unencumbered by native title, and thus that freehold value was the appropriate measure of the compensation. His Honour stated that it was necessary to arrive at a value which was less than freehold value and which recognised and gave effect to the nature of the native title rights and interests. 89 Griffiths (2016) 337 ALR 362 at 402 [213]-[214]. 91 (1941) 67 CLR 544; [1941] HCA 37. 92 Griffiths (2016) 337 ALR 362 at 403-405 [224], [227]-[228], [231]-[232]. Bell Nettle Gordon Full Court To some extent, the Full Court reasoned differently. Like the trial judge, their Honours took the view93 that the starting point for the calculation of the economic value of the Claim Group's native title rights and interests should be the freehold value of the land and that it should be adjusted to take account of the restrictions and limitations applicable to the non-exclusivity of those rights and interests. But the Full Court considered94 that the trial judge had erred in holding that those rights and interests constituted a real impediment to any further grants of interest in the land and, in a practical sense, were exercisable in such a way as to prevent any further activity on the land subject only to existing tenures. In the Full Court's view95, the trial judge had also erred in holding, in effect, that the loss to the Claim Group was to be calculated by reference to the benefit to the Northern Territory of acquiring the rights and interests, and that his Honour had thereby improperly inflated the figure for compensation. Further, in the Full Court's view96, the trial judge had erred in failing to discount the value of the Claim Group's native title rights and interests to allow for the fact that they were inalienable and also by rejecting the Spencer test of what a willing but not anxious purchaser would have been prepared to pay to a willing but not anxious vendor to secure the extinguishment of those rights and interests. The Full Court, however, rejected97 the Commonwealth's contention that the economic value of the Claim Group's native title rights and interests was no more than 50 per cent of freehold value. In the Full Court's view, they were worth 65 per cent of freehold value. At this stage, one further matter should be mentioned. The trial judge assessed98 the economic value of the native title rights and interests on the basis of the market value of freehold estates in various lots the subject of the compensable acts as valued by Mr Ross Copland, an expert land valuer called on 93 Northern Territory v Griffiths (2017) 256 FCR 478 at 519-520 [134]. 94 Northern Territory v Griffiths (2017) 256 FCR 478 at 508 [78]-[80]. 95 Northern Territory v Griffiths (2017) 256 FCR 478 at 510-511 [89]-[92]. 96 Northern Territory v Griffiths (2017) 256 FCR 478 at 515-516 [119], 517 [122]. 97 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [139]. 98 Griffiths (2016) 337 ALR 362 at 438 [414], 445-446 [463]. Bell Nettle Gordon behalf of the Commonwealth. On appeal to the Full Court99, the Northern Territory unsuccessfully challenged the trial judge's adoption of Mr Copland's valuations in respect of certain lots. Before this Court, the parties were agreed that Mr Copland's valuations should form the basis of the assessment of compensation save with respect to lot 16, in relation to which the Northern Territory urged this Court to adopt the valuation provided by its expert, Mr Wayne Wotton. That contention was put on the basis that Mr Lonergan's methodology for valuing native title rights and interests should be accepted. For reasons to be explained later in this judgment, Mr Lonergan's methodology is rejected. Criteria of valuation In this Court, all parties accepted that the economic value of the native title rights and interests should be determined by application of conventional economic principles and tools of analysis, and, in particular, by application of the Spencer test adapted as necessary to accommodate the unique character of native title rights and interests and the statutory context. The difference between the parties was as to how the Spencer test should be applied. The Full Court were right to begin their ascertainment of the economic value of the native title rights and interests with the identification of those rights and interests100. At common law, freehold ownership or, more precisely, an estate in fee simple is the most ample estate which can exist in land101. As such, it confers the greatest rights in relation to land and the greatest degree of power that can be exercised over the land102; and, for that reason, it ordinarily has 99 Northern Territory v Griffiths (2017) 256 FCR 478 at 522-523 [145], 524-525 100 See Western Australia v Brown (2014) 253 CLR 507 at 521 [34]; [2014] HCA 8. See also Mabo v Queensland [No 2] (1992) 175 CLR 1 at 58; [1992] HCA 23. 101 See Amodu Tijani [1921] 2 AC 399 at 403; Royal Sydney Golf Club v Federal Commissioner of Taxation (1955) 91 CLR 610 at 623; [1955] HCA 13; Megarry and Wade, The Law of Real Property, 8th ed (2012) at 52; Honoré, "Ownership" in Guest (ed), Oxford Essays in Jurisprudence (1961) 107. See also Fejo v Northern Territory (1998) 195 CLR 96 at 151-152 [107]; [1998] HCA 58. 102 See The Commonwealth v New South Wales (1923) 33 CLR 1 at 42, 45; [1923] HCA 34; Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 285; (Footnote continues on next page) Bell Nettle Gordon the greatest economic value of any estate in land. Lesser estates in land confer lesser rights in relation to land and, therefore, a lesser degree of power exercisable over the land; and, for that reason, they ordinarily have a lesser economic value than a fee simple interest in land. Similar considerations apply to native title. Native title rights and interests are not the same as common law proprietary rights and interests but the common law's conception of property as comprised of a "bundle of rights" is translatable to native title103, and, as has been held104, draws attention to the fact that, under traditional law and custom, some but not all native title rights and interests are capable of full or accurate expression as rights to control what others may do on or with the land. So, therefore, just as it is necessary to determine the nature and extent of common law proprietary rights and interests as a first step in their valuation, it is necessary to identify the native title rights and interests in question as the first step in their valuation. As the trial judge found, the Claim Group's rights and interests were essentially usufructuary105, ceremonial and non-exclusive. The Claim Group's rights and interests were perpetual and objectively valuable in that they entitled the Claim Group to live upon the land and exploit it for non-commercial purposes. But they were limited. As earlier mentioned, the historic grant of the pastoral leases extinguished the Claim Group's traditional right to control access to the land and to decide how the land should be used106; and, once so extinguished, the right did not revive107. Thereafter, the Claim Group had no [1944] HCA 4. See also Yanner v Eaton (1999) 201 CLR 351 at 365-366 [17]; [1999] HCA 53. 103 See Ward (2002) 213 CLR 1 at 95 [94]-[95], 262-264 [615]-[618]; Yorta Yorta (2002) 214 CLR 422 at 492-493 [186]; Akiba v The Commonwealth (2013) 250 CLR 209 at 239 [59]; [2013] HCA 33. 104 See Ward (2002) 213 CLR 1 at 95 [94]-[95]. 105 See and compare Akiba (2013) 250 CLR 209 at 219 [9], 228 [28]. 106 See Ward (2002) 213 CLR 1 at 82-83 [52], 131 [192], 138 [219], 196 [417]. 107 Griffiths [2014] FCA 256 at [43], [46]; Northern Territory v Griffiths (2017) 256 FCR 478 at 508 [80]. See also Native Title Act, s 237A; Wik (1996) 187 CLR 1 at 169; Yarmirr (2001) 208 CLR 1 at 68 [98]; Ward (2002) 213 CLR 1 at 82-83 [52], (Footnote continues on next page) Bell Nettle Gordon entitlement to exclude others from entering onto the land and no right to control the conduct of others on the land. Nor did the Claim Group have the right to grant co-existing rights and interests in the land. And because the Claim Group's native title rights and interests were non-exclusive, it was also open to the Northern Territory to grant additional co-existent rights and interests in and over the land, including grazing licences, usufructuary licences of up to five years' duration and licences to take various things from the land108. The economic value of the Claim Group's native title rights and interests fell to be valued accordingly. The task required an evaluative judgment to be made of the percentage reduction from full exclusive native title which properly represented the comparative limitations of the Claim Group's rights and interests relative to full exclusive native title and then the application of that percentage reduction to full freehold value as proxy for the economic value of full exclusive native title. The Claim Group contended that so to proceed offended the Racial Discrimination Act in two respects. The first was said to be that, because the Full Court did not equate the measure of compensation payable to native title holders to the compensation payable to the holders of other forms of title, the Full Court's reasoning was ex facie inconsistent with the protection afforded by s 10(1) of the Racial Discrimination Act. So much plainly followed, it was said, from the following observations of Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ in Western Australia v The Commonwealth (Native Title Act Case)109: "Security in the right to own property carries immunity from arbitrary deprivation of the property. Section 10(1) thus protects the enjoyment of traditional interests in land recognised by the common law. However, it has a further operation. If a law of a State provides that property held by members of the community generally may not be expropriated except for prescribed 131 [192], 138 [219]; Northern Territory v Alyawarr (2005) 145 FCR 442 at 108 Northern Territory v Griffiths (2017) 256 FCR 478 at 508-509 [80]-[82]; Crown Lands Ordinance (NT), ss 107, 108, 109; Crown Lands Act (NT), ss 88, 90, 91. 109 (1995) 183 CLR 373 at 437. Bell Nettle Gordon purposes or on prescribed conditions (including the payment of compensation), a State law which purports to authorise expropriation of property characteristically held by the 'persons of a particular race' for purposes additional to those generally justifying expropriation or on less stringent conditions (including lesser compensation) is inconsistent with s 10(1) of the Racial Discrimination Act." (footnote omitted) In that connection, the Claim Group also relied on the observation of Gleeson CJ, Gaudron, Gummow and Hayne JJ in Ward110 that: "the [Racial Discrimination Act] must be taken to proceed on the basis that different characteristics attaching to the ownership or inheritance of property by persons of a particular race are irrelevant to the question whether the right of persons of that race to own or inherit property is a right of the same kind as the right to own or inherit property enjoyed by persons of another race." In the Claim Group's submission, it followed that s 10(1) of the Racial Discrimination Act required that the Claim Group's non-exclusive native title rights and interests be valued in no different fashion from exclusive native title rights and interests, and, therefore, at not less than freehold value. Those contentions must be rejected. Whether or not the value of any given native title is to be equated to freehold value for the purposes of assessing just compensation must depend on the exact incidents of the native title rights and interests. If the native title rights and interests amount or come close to a full exclusive title, it is naturally to be expected that the native title rights and interests will have an objective economic value similar to freehold value. By contrast, if the native title rights and interests are significantly less than a full exclusive title, it is only to be expected that they will have an objective economic value significantly less than freehold value. There is nothing discriminatory about treating non-exclusive native title as a lesser interest in land than a full exclusive native title or, for that reason, as having a lesser economic value than a freehold estate. To the contrary, it is to treat like as like. The point made in both the Native Title Act Case and Ward was that, although native title rights and interests have different characteristics from common law land title rights and interests, and derive from a different source, 110 (2002) 213 CLR 1 at 105 [121]. Bell Nettle Gordon to a point short of extinguishment without payment of native title holders are not to be deprived of their native title rights and interests without the payment of just compensation any more than the holders of common law land title are not to be deprived of their rights and interests without the payment of just compensation. Equally, native title rights and interests cannot be impaired just compensation on terms comparable to the compensation payable to the holders of common law land title whose rights and interests may be impaired short of extinguishment. There was no suggestion in either the Native Title Act Case or Ward that the nature and incidents of particular native title rights and interests are irrelevant to their economic worth or to the determination of just compensation for extinguishment or impairment. To the contrary, it is plain from the holding111 in Ward that, because the non-exclusive native title rights and interests in that case did not amount to having "lawful control and management" of the land, the native title holders were not to be assimilated to "owners" but could at best be regarded as "occupiers" and thus could be compensated only at the lesser rate applicable to occupiers. As Gleeson CJ, Gaudron, Gummow and Hayne JJ stated112: "This result is no different from that which would obtain in respect of any holder of rights and interests that did not amount to the 'lawful control and management' of the land. The [Racial Discrimination Act] is therefore not engaged on this basis." In sum, what the Racial Discrimination Act requires in its application to native title is parity of treatment and there is no disparity of treatment if the economic value of native title rights and interests is assessed in accordance with conventional tools of economic valuation adapted as necessary to accommodate the unique character of native title rights and interests and the statutory context. To argue, as the Claim Group did, that there is disparity because their native title rights and interests have a lesser economic value than the economic value of an estate in fee simple is to ignore that the Claim Group's native title rights and interests were comparatively limited and considerably less extensive than full exclusive native title. Thus, as has already been emphasised, the proper comparison was not between the native title rights and interests and the rights and interests which comprise an estate in fee simple, but between the native title rights and interests and the rights and interests of a full exclusive native title. 111 (2002) 213 CLR 1 at 168-170 [317]-[321]. 112 (2002) 213 CLR 1 at 169 [317]. Bell Nettle Gordon The second respect in which it was contended that the Full Court's analysis offended the Racial Discrimination Act was that the Full Court took into account that the Claim Group's native title was vulnerable to diminution by the grant by the Northern Territory of lesser co-existing titles. The Claim Group contended that the operation of s 10(1) of the Racial Discrimination Act precluded the Northern Territory from granting any further interest in the land unless the same interest could have been granted over freehold or leasehold land under the Crown Lands Ordinance (NT) or the Crown Lands Act (NT), and thus that the Northern Territory would have been prevented from granting rights and interests over the land even if those grants were not inconsistent with the continued existence of the Claim Group's non-exclusive native title rights and interests. Alternatively, it was contended that, even if it had been open to the Northern Territory to grant such further interests, on the facts of this case the Northern Territory would not realistically have done so. Those contentions must also be rejected. It is necessary to consider the treatment of pastoral leases under the relevant legislation. Pastoral leases, before the determination in Wik113, satisfied the definition of a category A past act in the Native Title Act (an act which wholly extinguished native title if still in existence on 1 January 1994)114. In Wik115, this Court held that a pastoral lease was not necessarily inconsistent with all native title rights and interests. The Native Title Act was subsequently amended116 by the inclusion of a definition of previous non-exclusive possession act117, and by prescription of the effect of a previous non-exclusive possession act on native title118. Whilst that amendment acknowledged there could be a grant of a non-exclusive pastoral lease, there was no reversal of total extinguishment of native title by previous exclusive possession acts as had already occurred under 113 (1996) 187 CLR 1. 114 Native Title Act, ss 15(1)(a), 229(3)(a), (c). 115 (1996) 187 CLR 1 at 122, 126-127, 130, 154-155, 203-204, 242-243. 116 See Native Title Amendment Act 1998 (Cth). 117 Native Title Act, s 23F. 118 Native Title Act, s 23G. Bell Nettle Gordon the Native Title Act (as first enacted)119. Accordingly, if an exclusive pastoral lease120 granted after the enactment of the Racial Discrimination Act were still in force on 1 January 1994 that lease would be classified as a category A past act which wholly extinguished native title121. If, however, a non-exclusive pastoral lease122 were to some extent not inconsistent with native title, the grant was not classified as a past act but rather as a previous non-exclusive possession act and thus, native title was extinguished only to the extent of any inconsistency with native title123. According to the Claim Group's argument, every pastoral lease enacted after the commencement of the Racial Discrimination Act that was still in force on 1 January 1994 would have been invalid. But if that were so, it would mean that, perforce of ss 23G(2) and 15(1) of the Native Title Act, every such pastoral lease would be taken wholly to have extinguished native title. Contrary to the Claim Group's submissions, it has consistently been held that the question of validity of pastoral leases enacted after the commencement of the Racial Discrimination Act is to be determined according to whether the grant of a pastoral lease had any further extinguishing effect on native title124. Provided such further rights and interests were not inconsistent with the continued existence of native title, they did not detract from the native title holders' rights and interests and so did not discriminate against them125. 119 Native Title Act, s 23C. 120 Native Title Act, s 248A. 121 Native Title Act, ss 15(1), 23B, 23E, 23G(2), 228, 229(3). 122 Native Title Act, s 248B. 123 Native Title Act, s 23G(1)(b). 124 See De Rose v South Australia (2003) 133 FCR 325 at 432 [381], 433 [387], 436 [402], [405]; Moses v Western Australia (2007) 160 FCR 148 at 162-163 [53]-[56], 164 [65], 165 [74], 171 [101], 174-175 [113]; Neowarra v Western Australia [2003] FCA 1402 at [526], [532]. See also Ward (2002) 213 CLR 1 at 125 cf Ward (2002) 213 CLR 1 at 106 [123]. Bell Nettle Gordon The Claim Group's contention as to the improbability of the Northern Territory granting further interests in the land is beside the point. The contention as advanced focused on pastoral leases alone. It is plain, however, that the Full Court had in mind a variety of other interests, including grazing licences, usufructuary licences and licences to take things from the land. Furthermore, even if the likelihood of grants of further interests was slight, and none were in fact granted, it was the possibility of or potential for such grants that was relevant to economic value. For reasons already given and which will be discussed in more detail later in these reasons, it is the incidents of native title rights and interests and not the way in which they might be or not be exercised that is determinative of their nature and thus their economic value. The way that native title rights and interests are used and enjoyed may affect their non-economic or cultural value, which is dealt with separately, later in these reasons. The Claim Group argued that, even if that were so, the native title rights and interests were not concurrent with other rights and interests, because no other person held any rights or interests in the subject land that were valid against the native title rights and interests; that the recognition of native title rights and interests by the common law meant that those rights and interests could have been protected by legal and equitable remedies as if they were common law interests in land; and that the historic extinguishment of the Claim Group's right of exclusive possession did not in fact lessen the ability of the Claim Group to determine the use of their country by others through their power to surrender native title so as to enable the conferral of valid rights on others. Those arguments must also be rejected. The fact that the Claim Group may have had use and enjoyment of the subject land says nothing directly as to the nature of their native title rights and interests in the land and therefore nothing directly as to the entitlement of the Northern Territory to grant co-existing titles. Equally, the fact that infringement of the Claim Group's native title rights and interests might have been prevented by legal or equitable remedies126 says nothing against the entitlement of the Northern Territory to grant co-existing titles. And to the extent that the argument should be understood as being that the Claim Group had some sort of qualified right otherwise to control access to land, it is precluded by analogy with the holding in Ward that the grants of pastoral leases in that case were inconsistent with the continued 126 See and compare Mabo [No 2] (1992) 175 CLR 1 at 61; Ward (2002) 213 CLR 1 at Bell Nettle Gordon existence of the native title right to control access to land and make decisions as to how the land could lawfully be used by others. Bifurcated approach to valuation The parties were agreed before the trial judge and the Full Court that the approach to the assessment of just compensation should proceed according to what was described as the bifurcated approach of first determining the economic value of the native title rights and interests that had been extinguished and then estimating the additional, non-economic or cultural loss occasioned by the consequent diminution in the Claim Group's connection to country. That was an appropriate way to proceed. Just as compensation for the infringement of common law land title rights and interests is ordinarily comprised of both a component for the objective or economic effects of the infringement (being, in effect, the sum which a willing but not anxious purchaser would be prepared to pay to a willing but not anxious vendor to achieve the latter's assent to the infringement127) and a subjective or non-economic component (perhaps the most common instance of which is an allowance for special value128), the equality of treatment mandated by s 10(1) of the Racial Discrimination Act, as reflected in s 51 of the Native Title Act, necessitates that the assessment of just compensation for the infringement of native title rights and interests in land include both a component for the objective or economic effects of the infringement (being, in effect, the sum which a willing but not anxious purchaser would have been prepared to pay to a willing but not anxious vendor to obtain the latter's assent to the infringement, or, to put it another way, what the Claim Group could fairly and justly have demanded for their assent to the infringement) and a component for non-economic or cultural loss (being a fair and just assessment, in monetary 127 Spencer (1907) 5 CLR 418 at 432, 440-441; Kenny & Good Pty Ltd v MGICA (1992) Ltd (1999) 199 CLR 413 at 436 [49]-[50]; [1999] HCA 25; Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 233 CLR 259 at 276-277 [51]; [2008] HCA 5. 128 Minister for Public Works v Thistlethwayte [1954] AC 475 at 491; The Commonwealth v Reeve (1949) 78 CLR 410 at 418-420, 428-429, 435; [1949] HCA 22; Turner v Minister of Public Instruction (1956) 95 CLR 245 at 267, 280; [1956] HCA 7; Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 225-226 [80]-[83], cf at 269-270 [292]-[294]; 167 ALR 575 at 596-597, cf at 654-655; [1999] HCA 64. Bell Nettle Gordon terms, of the sense of loss of connection to country suffered by the Claim Group by reason of the infringement). Admittedly, there is a degree of artificiality about applying an adapted Spencer test in circumstances where it may be assumed that the Claim Group would not have been at all interested in selling their native title rights and interests and it is plain that no one could lawfully have bought them. But, at the same time, the native title rights and interests unquestionably existed and they had a recognisable economic worth which lay in the sum that might fairly and justly have been demanded for their lawful extinction in favour of the Crown. In those circumstances, it is no more artificial to seek to assess their economic value by means of the Spencer test of what a willing but not anxious purchaser would have been prepared to pay to a willing but not anxious vendor in order to buy them (or, more accurately, to obtain the latter's assent to their extinguishment) than it is to apply the Spencer test to the assessment of just compensation for the compulsory extinguishment of, say, a general law easement or profit à prendre129. At one point in the Full Court's reasons, their Honours reflected130 as to whether it might have been preferable to approach the assessment task on an "holistic"131 basis without the division of value into economic and non-economic components. Their Honours were correct to avoid that approach. There may be exceptions, but ordinarily the only way of achieving the degree of precision envisaged by s 51A of the Native Title Act – which, as has been seen, stipulates that the total compensation payable for an act which extinguishes native title must not exceed the amount that would be payable if the act were instead a compulsory acquisition of a freehold estate in the land or waters – is by the determination of economic value according to established precepts for the valuation of interests in land. Given that there is no range of decided comparable cases such as those which may be called in aid, for example, in sentencing132 or 129 See, eg, Sutherland Shire Council v Sydney Water Corporation [2008] NSWLEC 130 Northern Territory v Griffiths (2017) 256 FCR 478 at 520-522 [140]-[144]. 131 As was contended for by the Attorneys-General for the States of South Australia and Western Australia before this Court. 132 See, eg, Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45; R v Pham (2015) 256 CLR 550; [2015] HCA 39; R v Kilic (2016) 259 CLR 256; [2016] HCA 48. Bell Nettle Gordon when fixing damages for personal injuries133, an holistic approach would mean that the determination of the economic value of native title rights and interests would be largely dependent on idiosyncratic notions of what is fair and just. Determination of economic value of native title rights and interests Having determined the fair value of a freehold interest in the subject land, the Full Court were right to discount that figure by reference to the more limited nature of the Claim Group's native title rights and interests in order to arrive at the economic value of those more limited rights and interests. As the Northern Territory submitted before this Court, it is fundamental that there must be economic equivalence between the value of what is lost and the compensation which is paid134 and, therefore, that the economic value of the property that was lost must be assessed according to the rights and interests that were held135. Granted, as the Full Court observed136, the process necessitates making a fairly broad-brush estimate of the percentage of rights and interests comprising freehold title which is considered to be proportionate to the native title rights and interests, but that is an unavoidable consequence of the statutory scheme. The courts must do the best they can to achieve the statutory objectives of the Native Title Act. Rejection of Mr Lonergan's thesis The Northern Territory contended that there was available expert evidence in the form of the opinion given by Mr Lonergan as to what he conjectured might be the amount that the Claim Group would have been prepared to pay to acquire similar rights and interests in a different, more remote and undeveloped location, and that the Full Court should have accepted it. That contention must be rejected. Evidently, Mr Lonergan's thesis was that, in the absence of a relevant 133 See, eg, Thatcher v Charles (1961) 104 CLR 57 at 71; [1961] HCA 5; cf Planet Fisheries Pty Ltd v La Rosa (1968) 119 CLR 118 at 124-125; [1968] HCA 62. See also Mullany, "A New Approach to Compensation for Non-Pecuniary Loss in Australia" (1990) 17 Melbourne University Law Review 714. 134 Horn v Sunderland Corporation [1941] 2 KB 26 at 49; Nelungaloo Pty Ltd v The Commonwealth (1948) 75 CLR 495 at 571. 135 See Rosenbaum (1965) 114 CLR 424 at 429-430. 136 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [138]-[139]. Bell Nettle Gordon market or comparable sales data, the fair value of the Claim Group's native title rights and interests was to be assayed by reference to an appropriate comparator and, because the freehold value of land increases with the availability of services and surrounding infrastructure, whereas the Claim Group's enjoyment of their native title rights and interests did not, the appropriate comparator was freehold market value stripped of so much of it as reflected the availability of services and infrastructure. According to Mr Lonergan, that figure could be gleaned by taking the market value of a large nearby rural block without road access, power or water, yielding what Mr Lonergan termed a "usage value", and then adding an uplift or "negotiation value" which Mr Lonergan postulated could be derived by splitting the difference between the market value of the land (which includes the value of the availability of services and infrastructure) and the usage value of the native title rights and interests as so calculated, according to what Mr Lonergan described as principles of behavioural economics and game theory, economic experience and notions of fair dealing. As will be apparent, the principal difficulty with Mr Lonergan's thesis is that what it purports to value is not the economic value of the native title rights and interests in the subject land as required by the Native Title Act, but rather what the Claim Group might have been prepared to pay to acquire other land at a different location on which they might have lived and behaved in much the same way that they had been entitled to live and behave in the exercise of their native title rights and interests in the subject land. To demonstrate the difficulty, it assists to consider first what the position would have been if the Claim Group had had full exclusive native title in the subject land. As was earlier explained, s 51A of the Native Title Act read in context and with regard to the purpose of Div 5 of Pt 2 of the Native Title Act equates the economic value of full exclusive native title to the economic value of a freehold interest. If, therefore, the Claim Group had had a full exclusive native title in the subject land, the economic value of their native title as required to be determined by the Native Title Act would have been the freehold value of that land as determined by Mr Copland. If, however, the economic value of the Claim Group's supposed full exclusive native title were determined according to Mr Lonergan's thesis, it would be some lesser amount based on the economic value of a freehold interest in some other land at a different location. That is not what the Native Title Act requires. The same problem applies to non-exclusive native title of the kind in suit. Consistently with the aim of the Native Title Act that the economic value of full exclusive native title in land be equated to the economic value of a freehold title in that land, the economic value of non-exclusive native title in land falls to be Bell Nettle Gordon determined by making an evaluative judgment of the percentage reduction from full exclusive native title which properly represents the comparative limitations on the non-exclusive title relative to a full exclusive native title and then applying that percentage reduction to the economic value of a freehold estate in the land as proxy for the economic value of a full exclusive native title in the land. Application of Mr Lonergan's thesis would be most unlikely to produce the same dollar figure, and, if it did, it would be entirely adventitious. There is, too, a further, pragmatic reason to eschew the sort of approach favoured by Mr Lonergan. An opinion of the kind that the Northern Territory commissioned Mr Lonergan to produce is a complex and expensive exercise, and, as experience shows in litigation, where one party introduces an expert report of that complexity and expense it more often than not leads to another party commissioning another expert to produce a similarly complex and expensive report to rebut the thrust of the first, leaving it to a trial judge, often after extensive cross-examination of both experts at further considerable cost, to decide between the two. That degree of complexity and cost can be avoided if economic value is determined by the comparatively simple and relatively thrifty means of assessing the freehold value of the subject land and applying the appropriate percentage discount according to the nature of the native title rights and interests in suit. Given the presumably limited resources of most native title claimants, such simplicity and economy is surely to be encouraged. Conceivably, an approach of the kind advocated by Mr Lonergan could be of some assistance if parties were agreed that native title rights and interests are to be valued according to the kind of restorative or reinstatement approach137 urged before this Court on behalf of the Central Desert Native Title Services Limited and the Yamatji Marlpa Aboriginal Corporation intervening; assuming of course that the relevant court were persuaded on the evidence that such an approach was likely to be productive of just compensation. In this case, however, the content of Mr Lonergan's thesis makes plain that that possibility is excluded. The parties were right to agree before the trial judge and the Full Court that the Claim Group's native title rights and interests are to be valued according 137 See and compare Birmingham Corporation v West Midland Baptist (Trust) Association Inc [1970] AC 874 at 893-894; Kozaris v Roads Corporation [1991] 1 VR 237 at 240-242. Bell Nettle Gordon to the bifurcated approach. It would have been wrong to act upon Mr Lonergan's thesis and the trial judge and the Full Court were right to reject it. Differing values in different areas The Northern Territory and the Attorney-General for the State of South Australia criticised the Full Court's methodology as productive of what was contended to be the irrational consequence that native title rights and interests so valued would have a higher value in developed areas, where it was likely that the enjoyment of native title rights and interests would to some extent be compromised by encroaching development, and a lower value in remote areas, where the absence of encroaching development would allow native title rights and interests to be enjoyed to the full. The criticism is misplaced. As was observed in Western Australia v Brown138, the identification of native title rights and interests is an objective inquiry and it is the legal nature and content of the rights and interests that must be ascertained, not the way in which they have been exercised. Likewise, the economic valuation of rights and interests is an objective exercise and so, as has been emphasised, essentially an objective question of how much a willing but not anxious purchaser would be prepared to pay to a willing but not anxious vendor to obtain the latter's assent to their extinguishment139. Plainly enough, a willing purchaser would be likely to pay more to achieve the extinguishment of native title rights and interests over high-value land in a developed area (given that the economic potential of that kind of land is likely to be greater) than for the extinguishment of native title rights and interests over low-value land in a remote area (where the economic potential of the property is likely to be sparse). Consequently, it is neither irrational nor surprising that the economic value of native title rights and interests in developed areas should, in many cases, prove to be greater than the economic value of comparable native title rights and interests in a remote location. It is also no more than fair and just that the economic value of native title rights and interests should be assessed accordingly. With the compulsory 138 (2014) 253 CLR 507 at 521 [34]. See and compare Akiba (2013) 250 CLR 209 at 139 See and compare Spencer (1907) 5 CLR 418 at 441; Turner (1956) 95 CLR 245 at 264; Boland (1999) 74 ALJR 209 at 265-266 [271]-[274]; 167 ALR 575 at Bell Nettle Gordon acquisition of land, the value of land is generally speaking140 not limited to the pecuniary benefit of past uses but extends to its highest and best use in light of possible benefits in the future141. So, too, with the valuation of native title rights and interests in land, the value of the native title rights and interests is not ordinarily to be confined to the benefit of their past uses but should be extended to their highest and best use. As Dixon CJ stated in Turner v Minister of Public Instruction142: "the purpose is to ascertain the full return which may reasonably be expected from the sale of the land, not the most conservative value. The ultimate purpose of the inquiry is to find a figure which represents adequate compensation to the landowner for the loss of his land. Compensation should be the full monetary equivalent of the value to him of the land. All else is subsidiary to this end." And later143: "[The interest in land] is, of course, to be valued in cases of compensation with a view to ensuring that the actual value contained in the land is replaced in the hands of the owner by an equivalent amount of money. The value must therefore be the value to the owner which the land possessed to him in its condition at the date of resumption. That value was necessarily affected by all the advantages which the land possessed and these might be a matter of future or even contingent enjoyment. Future advantages or potentialities must not be excluded. At the same time the value of these things must be assessed according to the condition of the land as it stood at the time of resumption: 'it is the present value 140 Newton and Conolly, Land Acquisition, 7th ed (2017) at 139-143 [3.17]. 141 Trent-Stoughton v Barbados Water Supply Company Ltd [1893] AC 502 at 504; Boland (1999) 74 ALJR 209 at 265 [271]; 167 ALR 575 at 649; ISPT Pty Ltd v Melbourne City Council (2008) 20 VR 447 at 458-459 [37]-[41]. See also Jacobs, Law of Compulsory Land Acquisition, 2nd ed (2015) at 622-624 [26.55]; Cripps on Compulsory Acquisition of Land, 11th ed (1962) at 674 [4-003], 680-681 142 (1956) 95 CLR 245 at 264. 143 Turner (1956) 95 CLR 245 at 268. Bell Nettle Gordon alone of such advantages that falls to be determined': Cedars Rapids Manufacturing & Power Co v Lacoste144." (emphasis added) It may be that any sense of loss of connection to country resulting from the infringement or extinguishment of native title rights and interests in higher-value, developed areas is likely to prove less than the sense of loss of connection to country with respect to lower-value, remote areas because, depending on the facts of the case, the sense of connection to country in higher-value, developed areas may have declined as the result of encroaching the act of extinguishment or other compensable developments before diminishment. But if so, the amount to be awarded for non-economic loss of native title with respect to higher-value, developed land will be less. Significance of inalienability The Full Court were incorrect, however, in holding that the inalienability of native title rights and interests was a relevant discounting factor in the assessment of their economic value. The assessment of the economic value of native title rights and interests is in that respect different from the assessment of the economic value of common law land title. The alienability of a freehold estate is a relevant145, although not always significant, consideration in the determination of its economic value. Valuation cases involving inalienable freehold land disclose a range of discounted values of between 10 per cent and 80 per cent according to the extent of inalienability. The lowest, of 10 per cent, involved freehold land that was wholly inalienable146. The highest, of 80 per cent, concerned land that was limited to trust purposes but could be sold or leased with the permission of the Governor147. Between those 144 [1914] AC 569 at 576. 145 MacDermott v Corrie (1913) 17 CLR 223 at 232-233, 246-247; [1913] HCA 27; Corrie v MacDermott (1914) 18 CLR 511 at 514, 516; [1914] AC 1056 at 1062, 1064; The Commonwealth v Arklay (1952) 87 CLR 159 at 170-171; [1952] HCA 146 Council of the City of Liverpool v The Commonwealth (1993) 46 FCR 67 at 68-69, 147 Sydney Sailors' Home v Sydney Cove Redevelopment Authority (1977) 36 LGRA 106 at 108-109, 116-120. The 80 per cent figure is recorded in the editor's note at 106 of this report. Bell Nettle Gordon extremes lies a range of cases reflecting the economic significance of inalienability most commonly resulting in a reduction for inalienability of around 50 per cent148. By contrast, although native title rights and interests are inalienable, s 51A of the Native Title Act equates the economic value of full exclusive native title to the economic value of unencumbered, freely alienable freehold title and thus, in practical terms, deems the inalienability of full exclusive native title to be irrelevant to the assessment of its economic value. Similarly, just as the inalienability of full exclusive native title is deemed to be irrelevant to the assessment of its economic value, so too must it follow that the inalienability of non-exclusive native title is irrelevant to its economic value; for the latter, as has been explained149, falls to be determined by applying the appropriate percentage to the economic value of a freely alienable freehold title. The trial judge drew support for that conclusion from the decision of the Privy Council in Amodu Tijani and the decision of this Court in Geita Sebea. Those decisions, however, turned on the specific legislation under which land was acquired in those cases150. The Native Title Act is different. Here it is s 51A of that Act, read in light of the extrinsic materials, which makes clear that inalienability of native title is irrelevant to the assessment of its economic value. Benefit to Northern Territory The Full Court held that the trial judge erred in the assessment of the economic value of the native title rights and interests by taking into account the 148 See, eg, Hornsby Shire Council v Roads and Traffic Authority of New South Wales (1998) 100 LGERA 105 at 106, 108-109; Canterbury City Council v Roads and Traffic Authority of New South Wales [2002] NSWLEC 161 at [8], [30]; Canterbury City Council v Roads and Traffic Authority of New South Wales [2004] NSWLEC 172 at [16]; Liverpool City Council v Roads and Traffic Authority of New South Wales [2004] NSWLEC 543 at [15], [74]-[75]; Blacktown City Council v Roads and Traffic Authority of New South Wales [2004] NSWLEC 772 at [4], [19]; Blacktown City Council v Roads and Traffic Authority (NSW) (2006) 144 LGERA 265 at 269 [16], 278-279 [46], 288 [97]. 149 See [70] above. 150 See Amodu Tijani [1921] 2 AC 399 at 408-410; Geita Sebea (1941) 67 CLR 544 at 552, 557. See also Sydney Sailors' Home (1977) 36 LGRA 106 at 117-118. Bell Nettle Gordon economic value to the Northern Territory of achieving their extinguishment. Their Honours based151 that conclusion on the trial judge's observations152 that, although the individual bundle of rights to which the Northern Territory succeeded by reason of the compensable acts was different in character from the bundle of rights that the Claim Group had enjoyed, what the Northern Territory acquired was capable of indicating the economic value of the native title rights and interests; and so, if the valuation test focused on the value to the Northern Territory of the rights and interests which were surrendered, then the answer would be a figure close to freehold value. It is not clear that the trial judge made that error. It may be that all his Honour had in mind was that, as with the economic value of any other encumbrance, the economic value of native title rights and interests accords to what a willing but not anxious purchaser is prepared to pay to a willing but not anxious vendor to obtain the latter's assent to their extinguishment. But either way, the benefit of extinguishment to the Northern Territory was relevant only in so far as it would have informed the amount that the Northern Territory, as the sole, hypothetical willing purchaser, would have been prepared to pay for the consensual extinguishment of the native title rights and interests153. And the Full Court were right to hold that, for whatever reason, the trial judge had significantly over-estimated the value of the native title rights and interests as a percentage of freehold value. Possibly, as the Full Court observed154, one of the factors that led the trial judge to do so was to reason155 that it was inappropriate "simply to proceed on the basis of a comparison of the bundle of rights held by the [Claim Group], remote from their true character" (emphasis added). As the Full Court concluded, that observation suggests that his Honour may have included some allowance for the cultural loss or loss of connection to country despite having earlier noticed the importance of confining such considerations to the assessment 151 Northern Territory v Griffiths (2017) 256 FCR 478 at 510-511 [89]-[92]. 152 Griffiths (2016) 337 ALR 362 at 402-403 [217], 404-405 [232]. 153 See MacDermott (1913) 17 CLR 223 at 232-233, 251; Corrie (1914) 18 CLR 511 at 514; [1914] AC 1056 at 1062; Reeve (1949) 78 CLR 410 at 418. 154 Northern Territory v Griffiths (2017) 256 FCR 478 at 514 [112]-[114]. 155 Griffiths (2016) 337 ALR 362 at 402 [212]. Bell Nettle Gordon of non-economic value. Whatever the reason, however, the percentage was far too high. Manifest excessiveness Given the Claim Group's native title rights and interests were essentially usufructuary, ceremonial and non-exclusive, without power to prevent other persons entering or using the land or to confer permission on other persons to enter and use the land, without right to grant co-existing rights and interests in the land, and without right to exploit the land for commercial purposes, the trial judge's estimate of the economic value of the native title rights and interests as 80 per cent of the freehold value of the land was manifestly excessive. But so, too, with great respect, was the Full Court's estimate of 65 per cent. Granted, the determination of the appropriate percentage calls for an evaluative judgment about which reasonable minds might sometimes differ156. But here, given the native title was devoid of rights of admission, exclusion and commercial exploitation, a correct application of principle dictates on any reasonable view of the matter that those non-exclusive native title rights and interests, expressed as a percentage of freehold value, could certainly have been no more than 50 per cent. The Full Court's estimate of 65 per cent was plainly so high relative to the limited extent of the native title rights and interests as to bespeak error of principle. That is so notwithstanding that the Full Court included inalienability as a discounting factor in its estimate. Other things being equal, it would be appropriate to remit the matter to the Full Court for redetermination on that basis. But since no party suggested that the percentage should be set at below 50 per cent, it can be accepted for the purposes of the disposition of these appeals that 50 per cent is the figure. 156 See and compare British Fame (Owners) v Macgregor (Owners) (The Macgregor) [1943] AC 197 at 201, cited with approval in Podrebersek v Australian Iron and Steel Pty Ltd (1985) 59 ALJR 492 at 493-494; 59 ALR 529 at 532; [1985] HCA 34 and ALDI Foods Pty Ltd v Shop, Distributive & Allied Employees Association (2017) 92 ALJR 33 at 49 [99]; 350 ALR 381 at 400-401; [2017] HCA 53. See also Spencer (1907) 5 CLR 418 at 442-443; Hornsby Shire Council (1998) 100 LGERA Bell Nettle Gordon Interest on the economic loss claim It was common ground that interest should be awarded on the economic value of the extinguished native title rights and interests in order to reflect the time between when the entitlement to compensation arose and the date of judgment, and that the function of such an award is to compensate a party for the loss suffered by being kept out of his or her money during that period. The issue was whether the interest should be calculated on a simple basis or compound basis and, if on a compound basis, at what rate it should be compounded. The Claim Group argued that equity dictated an award of compound interest. As these reasons will explain, the Claim Group had no entitlement to compound interest. Decisions below and contentions in this Court The trial judge rejected157 the Claim Group's contention that equity dictated an award of compound interest. His Honour did not consider that the authorities on which the Claim Group relied supported the proposition that, in circumstances like the present, equity regards the fact that the Claim Group had not received their entitlement to compensation for a considerable period as a sufficient basis for an award on a compound interest basis. The trial judge noted158, however, that there was no authority which would preclude the Court from granting compound interest if persuaded that such an award was an appropriate means of securing fair compensation or compensation on just terms. Accordingly, his Honour held159, it was necessary to decide whether, if the Claim Group had been compensated as at the date of the compensable acts, they would have made such a use of the compensation as to warrant an award of compensation on a compound interest basis to compensate the Claim Group for the damage suffered by reason of that loss of opportunity. But his Honour was not persuaded160 that the Claim Group would have invested the moneys without expenditure, accumulating interest year by year, to the present time, or that they would have used the moneys to undertake any sort of commercial activity that 157 Griffiths (2016) 337 ALR 362 at 407-408 [249]-[251]. 158 Griffiths (2016) 337 ALR 362 at 408 [252]. 159 Griffiths (2016) 337 ALR 362 at 408 [253]. 160 Griffiths (2016) 337 ALR 362 at 413 [275]-[277]. Bell Nettle Gordon would have been profitable to the same or a greater degree. Thus, his Honour held161 that the appropriate interest calculation was simple interest at the Practice Note rate. Before the Full Court, the Claim Group contended162 that they were entitled to compound interest without proof of how they would have used compensation moneys, on the basis of the equitable principle that a fiduciary is not permitted to profit from the improper withholding of trust funds. The Claim Group further contended that, even if the Northern Territory were not a fiduciary, equity now allows for an award of compound interest without need of showing the loss suffered by being kept out of the money. Further or alternatively, the Claim Group argued that fair compensation or compensation on just terms was to be arrived at only by awarding the Claim Group the interest which the Northern Territory saved on its borrowings by retaining the compensation moneys over a very long period. The Full Court rejected163 those contentions. Before this Court, the Claim Group contended that an award of compound interest was necessary to achieve the requirement of compensation on just terms mandated by s 51(1) of the Native Title Act and that only compound interest at the risk free rate would satisfy that requirement. The argument was the subject of a notice issued pursuant to s 78B of the Judiciary Act 1903 (Cth) because it was considered to raise an issue as to whether "just terms" in s 51(1) is informed by the meaning of "just terms" in s 51(xxxi) of the Constitution. But, in the event, that point ceased to be of any consequence, and was not pursued. In substance, the Claim Group submitted that equity informs the notion of just terms; that it was inequitable for the Northern Territory to retain both the compensation moneys and the land or its rents or profits; and that simple interest unfairly favoured the Northern Territory where, as here, there was a lengthy period, which included times of high inflation, in which the Claim Group were seeking recognition of their infringed rights while the Northern Territory gained by saving on borrowing costs that were compounded. In short, as will be explained, equity allows for simple interest in proceedings for specific performance of a contract for the sale of land and although that rule has been extended to the compulsory acquisition of land, 161 Griffiths (2016) 337 ALR 362 at 413 [279]. 162 Northern Territory v Griffiths (2017) 256 FCR 478 at 527-528 [172]. 163 Northern Territory v Griffiths (2017) 256 FCR 478 at 536-537 [212]-[213]. Bell Nettle Gordon the rule provides for simple interest, not compound interest. Equity does allow for compound interest for suits for recovery of money obtained by fraud or withheld or applied in breach of fiduciary duty but the facts in these appeals do not fall into either of those categories. Finally, although a plaintiff may be able to claim restitution of a defendant's unlawful enrichment and that claim may include a claim for compound interest, the Claim Group did not make a claim for restitution of benefits; and the benefits derived by the Northern Territory are statutory and thus there was no "unjust enrichment". Although the Claim Group did not before this Court devote as much attention to the panoply of cases concerning the courts' power to award interest as they did in the Full Court, those cases nonetheless underpinned the Claim Group's contentions in this Court and it remains necessary to consider them in some detail. Interest in equity As the trial judge stated164, courts of law routinely allow pre-judgment interest on damages. But it is important to understand that the power of courts of law to award interest as such is essentially statutory. As Lockhart J observed in Whitaker v Commissioner of Taxation165, up until the nineteenth century, courts of law allowed interest only in cases where it was provided for by contract or custom. Effectively, it took the enactment of statutory provisions akin to those which now appear in s 51A of the Federal Court of Australia Act 1976 (Cth) and comparable State and Territory enactments166 to achieve the present position. Section 51A of the Federal Court of Australia Act applies to actions for the recovery of money (including debt, damages or the value of any goods). In view 164 Griffiths (2016) 337 ALR 362 at 407 [248]. 165 (1998) 82 FCR 261 at 268. 166 See, eg, Court Procedures Act 2004 (ACT), s 7, Sch 1, item 20 and Court Procedures Rules 2006 (ACT), r 1619; Civil Procedure Act 2005 (NSW), s 100; Supreme Court Act (NT), s 84; Civil Proceedings Act 2011 (Qld), s 58; Supreme Court Act 1935 (SA), s 30C; Supreme Court Act 1986 (Vic), ss 58-60; Supreme Court Act 1935 (WA), s 32. In Tasmania, the power of the Supreme Court to award interest is limited to "debts or sums certain" and damages in cases of conversion and trespass and insurance claims: Supreme Court Civil Procedure Act 1932 (Tas), ss 34-35. Bell Nettle Gordon of the Claim Group's submissions, s 51A has no direct application to these proceedings for an award of compensation under the Native Title Act. By contrast, in equity it was early recognised that it is proper to award simple interest on a money decree where the justice of the case requires it, and, as a result, equity developed detailed rules governing the award of interest. One such rule is that, in a suit for specific performance of a contract of sale of land where the vendor had shown title, the purchaser is required to pay interest on the purchase price, computed from the time at which the purchaser might prudently have taken possession until the date of decree167. As Lord St Leonards expressed the rule, in Birch v Joy168: "From the time at which the purchaser was to take possession of the estate he would be deemed its owner, and he would be entitled as owner to the rents of the estate, and would have kept them without account[.] From the same period the seller would have been deemed owner of the purchase-money, and that purchase-money not being paid by the man who was receiving the rents, would have carried interest, and that interest would have belonged to the seller as part of his property. A Court of Equity, as a general rule, considers this to follow. The parties change characters; the property remains at law just where it was, the purchaser has the money in his pocket, and the seller still has the estate vested in him; but they exchange characters in a court of equity, the seller becomes the owner of the money, and the purchaser becomes the owner of the estate. That is the settled rule of a court of equity …" The rule for the payment of simple interest in proceedings for specific performance of a contract of sale of land was later extended in In re Pigott and the Great Western Railway Co ("Pigott's Case")169 to a proceeding brought by summons under the Vendor and Purchaser Act 1874170 for the determination, inter alia, of whether a railway company which had compulsorily acquired land under the Lands Clauses Consolidation Act 1845171 was liable to pay interest on 167 See Esdaile v Stephenson (1822) 1 Sim & St 122 at 123 [57 ER 49 at 50]. 168 (1852) 3 HLC 565 at 590-591 [10 ER 222 at 233]. 169 (1881) 18 Ch D 146. 170 37 & 38 Vict c 78. 171 8 & 9 Vict c 18. Bell Nettle Gordon the purchase price. Jessel MR explained172 the application of the rule in that context thus: "The course of decision has been that after notice to treat has been given [by the railway company], and the price has been fixed [by arbitration under the Lands Clauses Consolidation Act 1845], but has not been paid, a contract is established which is enforceable in a Court of Equity, and on which an action for specific performance can be maintained. … The course of decision then being that specific performance of the contract as a contract of purchase and sale, or sale and purchase, may be enforced, I take it that, unless you find some statutory enactment in the way, all the ordinary rules apply. Consequently, … where the vendor has shewn his title, the purchaser pays interest from the time at which he might prudently have taken possession …" Application of the equitable rule to compulsory acquisition the involving rule beyond circumstances Subsequently, in Inglewood Pulp and Paper Co Ltd v New Brunswick Electric Power Commission173, the Privy Council further extended the application specifically enforceable synallagmatic or compulsory statutory contracts of sale of land to the assessment generally of compensation under statutory schemes for the compulsory acquisition of land. In Inglewood, the statutory scheme provided for a notice of expropriation to be served on the owner specifying the amount of compensation which the acquiring authority was willing to pay, and that, if the owner considered the specified sum to be unacceptable, the acquiring authority could apply for compensation to be assessed by a judge of the Supreme Court of New Brunswick, whereupon the judge would designate himself or herself the sole arbitrator for the determination of the compensation to be paid. Relevantly, one of the questions in that case was whether, in the absence of express statutory provision for the award of interest, the judge qua arbitrator had power to award simple interest on the compensation so assessed. Lord Warrington of Clyffe, who delivered the judgment of their Lordships, held174 that he did: 172 Pigott's Case (1881) 18 Ch D 146 at 150. 174 Inglewood [1928] AC 492 at 498-499. Bell Nettle Gordon "It is now well established that on a contract for sale and purchase of land it is the practice to require the purchaser to pay interest on his purchase money from the date when he took possession: per Lord Cave LC in Swift & Co v Board of Trade175. The law on the point has also been extended to cases under the Lands Clauses Consolidation Act, 1845. Their Lordships can see no good reason for distinguishing the present case from such cases. It is true that the expropriation under the Act in question is not effected for private gain, but for the good of the public at large, but for all that, the owner is deprived of his property in this case as much as in the other, and the rule has long been accepted in the interpretation of statutes that they are not to be held to deprive individuals of property without compensation unless the intention to do so is made quite clear. The statute in the present case contains nothing which indicates such an intention. The right to receive interest takes the place of the right to retain possession and is within the rule." In Marine Board of Launceston v Minister of State for the Navy176, to which it will be necessary to return in more detail later in these reasons, a majority of this Court reached a similar conclusion. In that case, reg 57(1) of the National Security (General) Regulations (Cth) provided that the Minister could by order requisition any property including ships and reg 60D provided that a person who suffered loss or damage by reason of anything done under reg 57(1) should be paid compensation to be determined by agreement or, in the absence of agreement, by a Compensation Board, and, if either party were dissatisfied with the assessment, by a court. A question arose as to whether the regulatory power to award compensation was limited to awarding a capital sum for the loss of the property or included a discretion to award interest on it. Dixon J, who was in the majority, observed177 that it is a question of legislative interpretation whether the legislative empowerment of a court or tribunal to determine compensation extends to "incidental matters and so to enable the court or tribunal to order that interest shall be paid on the compensation assessed and 175 [1925] AC 520 at 532. 176 (1945) 70 CLR 518; [1945] HCA 42. 177 Marine Board (1945) 70 CLR 518 at 532-533. Bell Nettle Gordon awarded, where according to legal or equitable principles it is payable", "the jurisdiction to determine compensation may be readily interpreted as extending to what is consequential upon or incidental to the award. Where the sum awarded carries interest according to the substantive law, including in that expression the doctrines of equity, it is no great step to say that the tribunal dealing with the matter may so declare." Application of the equitable rule to the Claim Group's claim As was earlier noticed, before the trial judge the Claim Group put their claim for interest on the basis of the equitable rule for the payment of interest as it applies to cases of compulsory acquisition but contended that the requirement for just compensation required that the interest be allowed on a compound basis. And as has also been seen, the trial judge rejected the argument on the basis that he could find no support for it in any of the authorities relating to the equitable rule for the payment of interest in cases of compulsory acquisition. The Full Court agreed179. Before this Court, the Claim Group did not contend that there was any authority for an award of compound interest but submitted on the basis of the authorities just referred to, together with a number of further authorities, that it would be consonant with equitable principle and just to award compound interest in the circumstances of this case. The authorities already referred to180 were relied on as establishing that, absent contrary statutory indication, moneys payable as compensation for the compulsory acquisition of land bear interest from the date of dispossession. The further authorities relied upon by the Claim Group in this Court and the courts below fall into two additional groups: cases where compound interest has been awarded in equity in suits for the recovery of money obtained by fraud or 178 Marine Board (1945) 70 CLR 518 at 533; see also at 526, 536, 538. 179 Northern Territory v Griffiths (2017) 256 FCR 478 at 528 [173]. 180 In particular, Marine Board (1945) 70 CLR 518. The Claim Group also relied upon Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 277-278; [1948] HCA 7. Bell Nettle Gordon withheld or applied in breach of trust or other fiduciary duty181; and cases where a defendant has had and received moneys to the use of a plaintiff and restitution has been awarded in an amount that includes a sum for what are conjectured to be the costs that the defendant would have incurred if the defendant had had to borrow the subject moneys182. Taking each of the three groups of cases in turn, the first, as the trial judge held183, establishes an entitlement, analogous to the equitable entitlement to interest in a suit for specific performance of a contract of sale of land, to interest on an award of compensation for compulsory acquisition of land. There is no support in that group of cases for the award of interest on a compound basis. Rather, to the contrary, in The Commonwealth v Huon Transport Pty Ltd, Dixon J, after recitation of Lord St Leonards' explication of the rule in equity for the award of interest on unpaid purchase money in a suit for specific performance of a contract of sale of land, stated184: "That being the ground of the rule, applying alike to voluntary and compulsory sales, it does not extend to compensation for injurious affection, upon which interest is not payable unless an intention to give interest upon unpaid compensation appears in the statute." (citation omitted) Although not directly on point, Dixon J's refutation of the notion that the equitable rule for the payment of interest on the outstanding purchase price under an uncompleted contract for the sale of land can be extended to allowing interest on outstanding hire fees suggests that the application of the rule in Pigott's Case to compulsory acquisition proceedings requires close adherence to equitable principle. To that extent, it provides no support for expansion of the rule to any broader basis of recovery. 181 See Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669 at 691-693, 701-702, 718; The Commonwealth v SCI Operations Pty Ltd (1998) 192 CLR 285 at 316 [74]; [1998] HCA 20. 182 See, eg, Sempra Metals Ltd v Inland Revenue Commissioners [2008] AC 561. 183 Griffiths (2016) 337 ALR 362 at 407 [249]. 184 (1945) 70 CLR 293 at 324; [1945] HCA 5. Bell Nettle Gordon The second line of authority, as the trial judge held185, goes no further than that compound interest may be awarded in equity in cases where money is obtained or withheld by fraud or in breach of fiduciary duty and the award is made in lieu of an account of profits. It does not suggest that, in a case of this kind where there is no fraud or breach of trust, equity would treat the fact of the Claim Group being kept out of their entitlement to compensation – even for over a decade – as a sufficient basis for the award of compound interest. According to the Full Court's reasons186, the Claim Group argued before the Full Court that the Northern Territory stood in fiduciary relation to the Claim Group on the basis that equity attached to the Northern Territory's unilateral extinguishment of native title in the same way that equity attaches to the voluntary surrender of native title, and thus that it was incumbent on the Northern Territory to exercise its power of unilateral extinguishment of the Claim Group's native title for the benefit of the Claim Group. Although not clear from their Honours' reasons, presumably it was also contended that, because the Northern Territory owed fiduciary obligations to the Claim Group, the Northern Territory had a duty not to profit at the expense of the Claim Group by delaying the payment of just compensation for the extinguishment of the native title, and thus that the Northern Territory was liable in equity to pay compound interest on the compensation for extinguishment of native title in lieu of accounting for the profit derived by not paying it any sooner. But whether or not that was the way the argument was put, the Full Court rejected it, as their Honours said187, because, absent express statutory provision requiring the Crown to act for the benefit of native title holders, it was doubtful that equity would impose fiduciary duties on the Crown in relation to the voluntary surrender of native title, and still more doubtful that equity would impose fiduciary duties on the Crown in relation to the unilateral extinguishment of native title. Moreover and more importantly, as the Full Court observed188, whatever may have been the position in the absence of statutory provision, it had been overtaken by the validation of the compensable acts by the Native Title Act, which meant that the power of the 185 Griffiths (2016) 337 ALR 362 at 408 [250]. 186 Northern Territory v Griffiths (2017) 256 FCR 478 at 527-528 [172], 529-530 187 Northern Territory v Griffiths (2017) 256 FCR 478 at 529-530 [176]-[177]. 188 Northern Territory v Griffiths (2017) 256 FCR 478 at 530 [178]. Bell Nettle Gordon Crown was unrestricted by any obligation that it be exercised for the benefit of native title holders. Before this Court, the Claim Group disavowed any suggestion of basing their claim for compound interest on breach of fiduciary duty. Even so, they contended in their written submissions that189: "equity imposes an obligation to pay interest [scil, presumably, compound interest], that this applies equally to the consideration for extinguishment on surrender or acquisition, and that this analysis is consistent with considered dicta that obligations may attach in relation to the surrender of native title." As has been observed, there is no question that equity may impose an obligation to pay interest on an uncompleted contract of sale of land and that the rule has been transposed by courts and tribunals to the assessment of just compensation under statutory schemes for compulsory acquisition of land. It may also be accepted that the principle applies as much to statutory schemes for the compulsory extinguishment of land title (including native title) as it does to schemes for the compulsory acquisition of land. In point of principle, there is no relevant difference between a contract for the sale of land and a contract for the surrender of an interest in land, or, therefore, between the compulsory acquisition of land and the compulsory extinguishment of an interest in land. But as has already been emphasised, the rule provides for the payment of simple interest and there is no suggestion in any of the authorities, or apparent reason in principle, to extend it to compound interest190. Further, the considered dicta cited by the Claim Group in support of the view that obligations of a fiduciary nature may attach in relation to the surrender of native title do nothing to advance the contention that interest on compensation for the extinguishment of native title should be paid on a compound basis. The Claim Group cited passages from Mabo v Queensland [No 2] in which Brennan J posited191 the possibility, which his Honour expressly did not resolve, that if native title holders voluntarily surrendered their native title to the Crown 189 Referring to Mabo [No 2] (1992) 175 CLR 1 at 60, 88-89, 113, 194, 204 and Wik (1996) 187 CLR 1 at 96. 190 See Westdeutsche Landesbank [1996] AC 669. 191 (1992) 175 CLR 1 at 60. Bell Nettle Gordon in the expectation of a grant of a tenure to the native title holders, there might be a fiduciary duty on the Crown to exercise its discretionary power to grant a tenure in the land so as to satisfy that expectation; in which Deane and Gaudron JJ stated192 that, where common law native title has not been extinguished, the rights under it may in appropriate circumstances be protected by equitable remedies including the imposition of a remedial constructive trust; and in which Toohey J stated193 that the Crown owes a fiduciary obligation to native title holders arising out of its extraordinary power to destroy or impair common law native title rights and interests. The observations of Brennan J and Deane and Gaudron JJ in Mabo [No 2] are equivocal. And in Wik, in a passage also cited by the Claim Group, Brennan CJ stated194 that where the Crown extinguishes native title under statutory authority, the Crown is under no duty to exercise the power of extinguishment in the native title holders' interests: "The exercise of statutory powers characteristically affects the rights or interests of individuals for better or worse. If the exercise of a discretionary power must affect adversely the rights or interests of individuals, it is impossible to suppose that the repository of the power shall so act that the beneficiary might expect that the power will be exercised in his or her interests. The imposition on the repository of a fiduciary duty to individuals who will be adversely affected by the exercise of the power would preclude its exercise. On the other hand, a discretionary power – whether statutory or not – that is conferred on a repository for exercise on behalf of, or for the benefit of, another or others might well have to be exercised by the repository in the manner expected of a fiduciary. … The power of alienation conferred on the Crown by s 6 of the [Land Act 1910 (Qld)] is inherently inconsistent with the notion that it should be exercised as agent for or on behalf of the indigenous inhabitants of the land to be alienated. Accordingly, there is no foundation for imputing to the Crown a fiduciary duty governing the exercise of the power." (footnote omitted) 192 (1992) 175 CLR 1 at 113. 193 (1992) 175 CLR 1 at 203-204. 194 (1996) 187 CLR 1 at 96-97. Bell Nettle Gordon As the Full Court observed, those observations, taken together with the fact that the Native Title Act provides for the validation of certain acts that impair or extinguish native title, tend against the conclusion that fiduciary obligations exist or that an analogy to such obligations is appropriate. In short, the passages cited by the Claim Group from Mabo [No 2] and Wik do not assist the claim for compound interest. The Claim Group contended that, despite the retrospective validation of the compensable acts, it remained an historical fact that there was a period of more than a decade between the commission of the compensable acts and their validation, during which the acts were invalid, and thus that the Northern Territory should be accountable on a compound interest basis for the unfairness of having had the benefit of unlawful extinguishment of title for that period; in just the same way that those who obtain money by fraud or in breach of fiduciary duty may be held accountable in equity on a compound interest basis for the benefit of their unlawful gain195. The difficulty with that argument, as the trial judge196 and the Full Court stated197, however, is that, by reason of the retrospective validation of the compensable acts, those acts must now be taken as always having been valid. Whatever might have been the position before the enactment of the Native Title Act and its validation of the compensable acts, what the Claim Group now have is neither more nor less than a statutory right to just compensation for the lawful extinguishment of their native title rights and interests. In the absence of a recognised juridical basis for the award of compound interest on compensation for the lawful extinguishment of land title, it does not appear unjust that interest should be awarded on a simple interest basis. 195 President of India v La Pintada Compania Navigacion SA [1985] AC 104 at 116; Hungerfords v Walker (1989) 171 CLR 125 at 148; [1989] HCA 8. See also Wallersteiner v Moir [No 2] [1975] QB 373; Kuwait Oil Tanker Co SAK v Al Bader [2000] 2 All ER (Comm) 271 at 344 [209]-[210]; Clef Aquitaine SARL v Laporte Materials (Barrow) Ltd [2001] QB 488 at 504-506; Black v Davies [2005] EWCA Civ 531 at [87]; cf Edelman, McGregor on Damages, 20th ed (2018) at 639 196 Griffiths (2016) 337 ALR 362 at 410 [259]. 197 Northern Territory v Griffiths (2017) 256 FCR 478 at 530 [179]. Bell Nettle Gordon As has been observed, it is possible that there may be circumstances in which, by analogy with an award of damages at common law for loss of use of money, it would be just to award interest on a native title compensation claim on a compound interest basis198. The Native Title Act provides that regard may be had to the rules applicable to compulsory acquisition of land, which, as has been seen, in effect import the rule in Pigott's Case. But the Native Title Act does not dictate that the rules applicable to compulsory acquisition of land are the only considerations to which regard may be had. Thus, as the trial judge posited199, if the evidence established that, upon earlier payment of the compensation, the Claim Group would have put the compensation to work at a profit, or perhaps used it to defray costs of doing business, it may be that an award of compound interest would be warranted to compensate for the lost opportunity of investment or those costs, by analogy with damages awarded at common law to compensate for expenses incurred or opportunity costs arising from moneys paid away or withheld as a result of breach of contract or negligence200. But, for the present, that point need not be decided. As the trial judge found201, there was sparse evidence that the Claim Group would have invested the compensation at a profit and no suggestion that the Claim Group incurred costs that could have been avoided with the aid of an earlier payment of the compensation. That leaves the third line of authority, which was said to support a free-standing entitlement to compound interest as a means of redressing the alleged injustice of the Northern Territory having derived rents and profits from some of the land subject to extinguished native title. That contention faces difficulties at three levels, and should be rejected. First, in The Commonwealth v SCI Operations Pty Ltd, McHugh and Gummow JJ doubted202 that there is a free-standing right to interest where a 198 See and compare Man Nutzfahrzeuge AG v Freightliner Ltd [2005] EWHC 2347 (Comm) at [320]-[321]. 199 Griffiths (2016) 337 ALR 362 at 408 [253]. 200 See Hungerfords (1989) 171 CLR 125 at 142-146, 152. See also Ben v Suva City Council [2008] FJSC 17. 201 Griffiths (2016) 337 ALR 362 at 413 [275]-[277]. 202 (1998) 192 CLR 285 at 316-317 [72]-[75]. Bell Nettle Gordon defendant has been unjustly enriched by the use of a plaintiff's money at the plaintiff's expense: "Independently of their reliance upon s 51A [of the Federal Court of Australia Act] as the source of curial authority to award the interest they seek in these proceedings, SCI and ACI assert a 'free-standing' right to the recovery of interest where the defendant has had the use of the plaintiff's money in circumstances which indicate an unjust enrichment at the expense of the plaintiff. The existing state of authority does not favour acceptance of such a broad proposition. The present is not a case where the assertion is that the appellant's breach of contract or negligence has caused the respondents to pay away or the appellant to withhold money and as a result the respondents have been deprived of the use of the money so paid away or withheld. Nor do the respondents seek an award of damages representing compensation for a wrongfully caused loss of their money, which is assessed wholly or partly by reference to the interest which would have been earned by safe investment of the money. It is true that in the administration of its remedies, equity followed a different path to the common law with respect to the award of interest. In cases of money obtained and retained by fraud and money withheld or misapplied by a trustee or fiduciary, the decree might require payment of compound interest. However, in Westdeutsche Landesbank Girocentrale v Islington London Borough Council, the House of Lords answered in the negative the question whether, where statutes, of which s 51A(2)(a) is a local example, provide for orders for payment of simple but not compound interest upon common law claims, equity, in its auxiliary jurisdiction, will supplement the statute by providing for an award of compound interest. In other instances, equitable relief might involve the payment of simple interest. As an element in the relief administered upon rescission of a contract under which the plaintiff had paid over moneys to the defendant, the order might require the defendant to make the repayment with interest calculated from the date of the initial payment. Relief against forfeiture by a vendor of payments under an instalment or terms contract might require repayment with interest from the dates the respective instalments were paid. An account of profits would carry interest. Conversely, a party seeking equitable relief may be obliged to do equity by the payment or repayment of moneys with interest. A purchaser Bell Nettle Gordon who, after the date fixed for completion, seeks specific performance will be treated in equity as having been in possession from the completion date and, in general, will be required to offer the vendor interest on the purchase price from that date. However, the present litigation does not involve the administration of any equitable relief and so call for consideration of the issue whether it was unconscientious of the appellant to make the refunds on 3 June 1994 without the addition of payments on account of interest." (footnotes omitted) Secondly, properly analysed, such authority as there now is in favour of a free-standing right of the kind contended for goes no further than recognising a restitutionary entitlement at law calculated to redress a defendant's unlawful enrichment through use of moneys which the defendant is regarded as having had and received to the use of the plaintiff203. The Claim Group's claim is not a claim for restitution of benefits unjustly obtained by the Northern Territory at the expense of the Claim Group. It is a claim for just compensation for the loss caused to the Claim Group by the extinguishment of native title. And the purpose of compensation is to put the Claim Group, so far as money can do, in the position in which they would have been if the native title had not been extinguished. It is not in any sense to provide restitution of benefits which it might be supposed the Crown derived by reason of the extinguishment of native title. Nor is there an analogy to be drawn between a claim for compensation for extinguishment of native title and a claim for money had and received, or with the recovery of money obtained by fraud or money withheld or misapplied by a fiduciary. As the trial judge held204, such if any benefit as the Northern Territory derived from the extinguishment of the native title is irrelevant. Thirdly, and most importantly, even if benefits derived by the Crown were a relevant consideration in the assessment of compensation for extinguishment of native title, the statutory validation of the compensable acts means that any 203 Nykredit Mortgage Bank plc v Edward Erdman Group Ltd [No 2] [1997] 1 WLR 1627 at 1636-1637; [1998] 1 All ER 305 at 314-315; Sempra Metals [2008] AC cf at 608-610 [132], 617 [151], 649-654 [231]-[240]; and see now Littlewoods Ltd v Revenue and Customs Commissioners [2017] 3 WLR 1401; [2018] 1 All ER 83. Compare Heydon v NRMA Ltd [No 2] (2001) 53 NSWLR 600 at 605-606 204 Griffiths (2016) 337 ALR 362 at 410 [259]. Bell Nettle Gordon benefit the Northern Territory derived from the extinguishment of the Claim Group's native title was not unjust. To adopt and adapt the language of McHugh and Gummow JJ in SCI Operations205, such benefits as the Northern Territory might have derived from the extinguishment of native title, or from the delay in payment of compensation, are the product of statute, and the restitutionary considerations which are present in various areas of the law cannot purport to override statute by claiming a superior sense of justice to Parliament's. The Claim Group's claim for compound interest was rightly rejected. Practice Note rate Although the Claim Group made much in written submissions, and to a lesser extent in oral argument before this Court, of whether the trial judge should have allowed interest at the risk free rate rather than the Practice Note rate which his Honour adopted, the Claim Group acknowledged before this Court that, unless they were successful in their claim for compound interest, they were better off with interest at the Practice Note rate. Further, apart from the Claim Group, no party contended below or before this Court that the trial judge was in error in awarding interest at the Practice Note rate, and, before this Court, the Claim Group accepted that, if the trial judge were not in error in declining to award interest on a compound interest basis, the Claim Group did not wish to be heard to say that there was any error in the selection of the Practice Note rate. Interest on or as part of compensation Finally in respect of interest, there is a question agitated by the Commonwealth of whether the trial judge and the Full Court were correct to award interest as part of compensation, as their Honours did206, or whether their Honours should rather have awarded the interest as interest on compensation. For present purposes, it is a matter of little consequence because, either way, the amount of interest payable will be the same. But the Commonwealth pressed the issue because it sought to establish that interest of the kind that was awarded 205 (1998) 192 CLR 285 at 317 [76], quoting National Australia Bank Ltd v Budget Stationery Supplies Pty Ltd (1997) 217 ALR 365 at 371. 206 Griffiths (2016) 337 ALR 362 at 408-409 [254]; Northern Territory v Griffiths (2017) 256 FCR 478 at 539 [225]-[226]. Bell Nettle Gordon does not count as part of the "total compensation" within the meaning of s 51A(1) of the Native Title Act. For the reasons that follow, that contention should be accepted. In Swift & Co v Board of Trade207, the House of Lords held that to award interest on compensation for goods which had been requisitioned under the Defence of the Realm Regulations (UK) would be to award compensation not for the goods themselves but for the time occupied in ascertaining their true value in accordance with the regulations, and, since the rule in Pigott's Case did not extend to the compulsory acquisition of goods, the power to award compensation for the goods did not extend to awarding interest. Viscount Cave LC, with whom Lord Buckmaster agreed208, stated209: "To hold otherwise is to give compensation, not for the goods themselves, but for the time occupied in ascertaining their value in accordance with the law." Lord Sumner, with whom Lord Dunedin agreed210, dealt with the matter to the same effect but more explicitly211: "Now, not only is 'compensation' the word used [in the regulation] and not 'interest' but there is nothing in the regulation to attach an allowance of interest to. There is no debt, for no final award has been made; there has been no wrong done, for the requisitioning was legal and the goods became the minister's goods from the time of requisition. It is the regulation itself that prescribed arbitration, a proceeding which involves delay and causes the merchant to be out of his compensation for a substantial time, or rather postpones the date at which his compensation can be fixed and so become payable. To give interest is really to give additional compensation for being the victim of war legislation, and this subject of compensation is not within the regulation." (emphasis added) 208 Swift [1925] AC 520 at 533. 209 Swift [1925] AC 520 at 533. 210 Swift [1925] AC 520 at 549. 211 Swift [1925] AC 520 at 548. Bell Nettle Gordon A similar question fell for determination by this Court in Huon Transport212. In that case, s 67 of the Defence Act 1903 (Cth) provided that "[t]he owner of any … boat or vessel … required for naval or military purposes, shall, when required to do so by [an authorised officer], furnish it for those purposes, and shall be recompensed therefor in the manner prescribed" (emphasis added). The issue was whether s 67, considered in light of s 51(xxxi) of the Constitution, authorised the court to allow interest. It was held, by majority (Latham CJ, Starke, Dixon and McTiernan JJ, Rich and Williams JJ dissenting), that it did not. Latham CJ decided213 the issue on a basis not presently relevant, that the matter was one of implied contract and that upon such a contract there was no liability to pay interest either at law or in equity. McTiernan J decided214 to the same effect. Starke J held215, in accordance with Swift, that interest could not be allowed in respect of a requisition of goods unless the statute or regulation authorising the requisition itself authorised the allowance of interest. Rich J, in dissent, decided216 on the basis that, although Swift had determined that the power to award compensation did not include power to award interest, their Lordships had not decided what was just in respect of the payment of interest. Read in light of s 51(xxxi) of the Constitution, s 67 of the Defence Act was to be understood as providing for just compensation, and compensation was not just unless it provided for both the value of what had been expropriated and the "amount of any damage sustained by [the owner] by reason of the expropriation"217, which included being deprived of the use of the vessel for the considerable time which it took to assess compensation. Just terms therefore involved as a matter of elementary fairness the payment of interest218. Williams J appears to have considered219 that the payment of interest could have been sanctioned consistently with Swift on the basis that the rule in Pigott's Case 212 (1945) 70 CLR 293. 213 Huon Transport (1945) 70 CLR 293 at 303. 214 Huon Transport (1945) 70 CLR 293 at 329. 215 Huon Transport (1945) 70 CLR 293 at 315. 216 Huon Transport (1945) 70 CLR 293 at 310. 217 Huon Transport (1945) 70 CLR 293 at 306. 218 Huon Transport (1945) 70 CLR 293 at 307. 219 Huon Transport (1945) 70 CLR 293 at 334-335. Bell Nettle Gordon applies to a contract of sale of a ship (such a contract being specifically enforceable), but in any event, like Rich J, his Honour held220 that, read in light of s 51(xxxi) of the Constitution, s 67 of the Defence Act was to be understood as providing for recompense on just terms and just terms necessitated the payment of interest "to make the compensation adequate". In light of subsequent developments, however, Dixon J's analysis of the issues was the most significant. His Honour rejected the notion that s 51(xxxi) of the Constitution required the payment of interest, on the basis that221: represents, not "the compensation income-producing corpus, the capital value of the ships, but hire or charter moneys, a revenue item forming the income produced by the corpus. I do not think that even the American Fifth Amendment makes it necessary to add interest to compensation on revenue account while outstanding …" the His Honour also held in effect that, although it could be accepted that the rule in Pigott's Case applied to a contract for the sale of a ship, the matter was to be decided according to whether it was possible to extract from the word "recompense" in s 67 of the Defence Act authority to award interest. And his Honour held222 that it was not: "If we work out the implications of the word 'recompense' according to ordinary legal principles, we have the decision in Swift's Case for our guidance upon the place interest takes in the conception of compensation in English law. As Starke J has pointed out in his judgment, the argument was fully stated by Scrutton LJ that, as his Lordship put it, 'the owner of property seized does not receive full compensation, if he loses the property in one year and only receives the value of the property at the time of loss five years afterwards.' … His dissenting judgment, however, did not prevail and the House of Lords plainly rejected the argument. Our Constitution, when it refers to 'just terms', is placing a qualification on the legislative power it bestows to acquire property compulsorily. But it is, I think, difficult to say that it makes it necessary for the legislature to 220 Huon Transport (1945) 70 CLR 293 at 337-338. 221 Huon Transport (1945) 70 CLR 293 at 325. 222 Huon Transport (1945) 70 CLR 293 at 326, quoting Swift and Co v Board of Trade (1924) 40 TLR 424 at 429. Bell Nettle Gordon give more than the full content of 'compensation', as compensation is understood in English law, and we know from the House of Lords that a right to interest on the amount payable for the thing is not always or necessarily included. Section 51(xxxi) has not the effect of transferring into our Constitution the Fifth Amendment, nor all the glosses placed upon it. But, whatever may be the correct view of compensation forming a replacement of income-producing capital assets, I do not think that we can find in s 67, interpreted in the light of s 51(xxxi), enough to enable us to award interest upon the recompense we now hold to be payable." (footnotes omitted) Importantly for present purposes, it is apparent from that passage of the judgment that Dixon J took Swift to have established that interest allowed to compensate a claimant for being kept out of compensation for compulsory acquisition of the claimant's property is not, as a matter of general law, to be regarded as compensation for the compulsory acquisition of the property, and that, as a matter of constitutional law, s 51(xxxi) of the Constitution did not necessitate any different conclusion. Subsequently, a similar question arose for consideration in Marine Board223, in which Dixon J approached the matter consistently with the principles which his Honour had essayed in Huon Transport but with a different result. The issue there was whether a power to award "compensation" for the requisitioning of a ship included power also to award interest. After referring to Swift, Dixon J reiterated224 that there is a clear difference between a sum awarded or assessed as compensation for the loss of property and a sum awarded for interest or compensation allowed where a claimant has been deprived of the use and occupation of the property without immediate recoupment in money. Consistently with his judgment in Huon Transport, his Honour also reasoned225 that whether a court or tribunal charged under statute with awarding "compensation" for the acquisition of land has power also to award interest depended on the proper construction of the statute. But his Honour concluded226, in apparent contradistinction to his interpretation of the power to award 223 (1945) 70 CLR 518. 224 Marine Board (1945) 70 CLR 518 at 532. 225 Marine Board (1945) 70 CLR 518 at 532-533. 226 Marine Board (1945) 70 CLR 518 at 533. Bell Nettle Gordon "recompense" in Huon Transport, that, absent contrary indication, the statutory power to determine "compensation" for the requisition of a ship could readily be interpreted as extending to awarding what is consequential upon or incidental to the award according to substantive law and equity. Furthermore, his Honour in effect regarded Marine Board as distinguishable from Swift because, although the rule in Pigott's Case did not apply to goods of the kind which had been requisitioned in Swift, it did apply to the requisition of a ship of the kind that was in issue in Marine Board and so provided a basis in equity for the award of interest227. It followed, Dixon J concluded, that, upon the proper construction of the regulations conferring power to award compensation, there was incidental, implied jurisdiction to determine and order that interest be paid. By contrast, Williams J held228 that the claimant should be paid interest "on the balance of compensation" because the payment of interest was required to make the compensation full and adequate and therefore just; and hence that statutory authority to determine "just compensation" was sufficient to authorise the award of interest. McTiernan J considered229 the Court to be bound by the authority of Swift to hold that interest on compensation is not generally an element in the compensation, but also concluded230 that the power to award interest was an incident of the jurisdiction to award "just compensation". Similarly, Rich J concluded231 that interest should be allowed as part of the compensation on just terms. Latham CJ and Starke J, in dissent, held232 that interest was not part of compensation for compulsory acquisition but rather compensation for delay in making payment of compensation for compulsory acquisition, and, therefore, that there was no jurisdiction to award interest. 227 Marine Board (1945) 70 CLR 518 at 533. 228 Marine Board (1945) 70 CLR 518 at 537. 229 Marine Board (1945) 70 CLR 518 at 534. 230 Marine Board (1945) 70 CLR 518 at 535. 231 Marine Board (1945) 70 CLR 518 at 527. 232 Marine Board (1945) 70 CLR 518 at 527, 528. Bell Nettle Gordon Absent authority, there would be something to be said for the view of Lord Clyde in Commissioners of Inland Revenue v Ballantine233 (speaking of an arbitrator's award of interest on a claim by contractors for additional costs, losses and damages) that: "In all such cases, however – whether the allowance is wrapped up in a slump award or is separately stated in the decree – the interest calculation is used in modum aestimationis only. The interest is such merely in name, for it truly constitutes that part of the compensation decerned for which is attributable to the fact that the claimant has been kept out of his due for a long period of time." As has now been seen, however, although those Justices who comprised the majorities in Huon Transport and Marine Board did not agree as to whether interest allowed to a claimant for being kept out of compensation is part of that compensation or rather interest on it for being kept out of it – and adding in the views of the dissentients on the point does not produce a majority234 – the clear balance of persuasion lay with the view that such interest is not part of the compensation for compulsory acquisition but a separate compensation for being kept out of the money. And as a matter of principle, there is no reason to doubt that is so. To adopt and adapt the observation of Lord Sumner in Swift235, an award of interest in the present proceedings is not compensation for the extinguishment of native title but, consistent with the legislative scheme for the establishment and extinguishment of, and compensation for, native title that is set up by the Native Title Act, is compensation for being kept out of that amount which the Claim Group should have received at the time of extinguishment. Such a conclusion is consistent with, and indeed favoured by, the terms of s 51(1) of the Native Title Act, which refers to the entitlement to compensation under the Act as an "entitlement on just terms to compensate the native title holders for any loss, diminution, impairment or other effect of the act on their native title rights and interests" (emphasis added). 233 (1924) 8 TC 595 at 611-612. See also Federal Wharf Co Ltd v Deputy Federal Commissioner of Taxation (1930) 44 CLR 24 at 26; [1930] HCA 30. 234 See Great Western Railway Co v Owners of SS Mostyn [1928] AC 57 at 73-74; Dickenson's Arcade Pty Ltd v Tasmania (1974) 130 CLR 177 at 188; [1974] HCA 9; Federation Insurance Ltd v Wasson (1987) 163 CLR 303 at 314; [1987] HCA 235 [1925] AC 520 at 548. Bell Nettle Gordon The Commonwealth contended that, that being so, it followed that the interest ordered to be paid to the Claim Group was not part of the total compensation payable for the extinguishment of native title within the meaning of s 51A of the Native Title Act. That contention should be accepted. Cultural loss This part of these reasons is concerned with compensation for the non-economic effect of the compensable acts, consistently with the second of the inquiries required by the statutory definition of native title – the native title holders' connection with the land by reason of their laws and customs. As was observed by the plurality in this Court in Ward236: "the connection which Aboriginal peoples have with 'country' is essentially spiritual. In Milirrpum v Nabalco Pty Ltd [(1971) 17 FLR 141 at 167], Blackburn J said that: 'the fundamental truth about the aboriginals' relationship to the land is that whatever else it is, it is a religious relationship … There is an unquestioned scheme of things in which the spirit ancestors, the people of the clan, particular land and everything that exists on and in it, are organic parts of one indissoluble whole'. It is a relationship which sometimes is spoken of as having to care for, and being able to 'speak for', country. 'Speaking for' country is bound up with the idea that, at least in some circumstances, others should ask for permission to enter upon country or use it or enjoy its resources, but to focus only on the requirement that others seek permission for some activities would oversimplify the nature of the connection that the phrase seeks to capture. The difficulty of expressing a relationship between a community or group of Aboriginal people and the land in terms of rights and interests is evident. Yet that is required by the [Native Title Act]. The spiritual or religious is translated into the legal. This requires the fragmentation of an integrated view of the ordering of affairs into rights and interests which are considered apart from the duties and obligations which go with them. The difficulties are not reduced by the inevitable tendency to think of rights and interests in relation to the land only in terms familiar to the common lawyer." 236 (2002) 213 CLR 1 at 64-65 [14]. Bell Nettle Gordon Compensation for the non-economic effect of compensable acts is compensation for that aspect of the value of land to native title holders which is inherent in the thing that has been lost, diminished, impaired or otherwise affected by the compensable acts. It is not just about hurt feelings, although the strength of feeling may have evidentiary value in determining the extent of it. It is compensation for a particular effect of a compensable act – what is better described as "cultural loss". As the trial judge explained, his Honour's task was to determine the essentially spiritual relationship which the Ngaliwurru and Nungali Peoples have with their country and to translate the spiritual hurt from the compensable acts into compensation. Agreed bases of assessment Specific aspects of the approach to this component of the compensation claim were not in dispute before the courts below or in this Court. There was no dispute that an award of this kind was appropriate and that the award was to be made on an in globo basis to the Claim Group with the apportionment or distribution of the award as between members being an intramural matter. Further, there was no dispute that it would not be appropriate for the award to reflect the number of native title holders at the time that native title was determined to have existed given that the cultural loss would be suffered by the native title holders as a whole and because of the inter-relationships between members of related country groups and their relationships to the countries of those groups. And, finally, there was no dispute that the assessment of the effects of the acts causing cultural loss could not be divorced from the content of the traditional laws and customs acknowledged and observed by the Claim Group. That is unsurprising. The definition of native title rights and interests in s 223(1) comprises a number of interlocking elements, all of which must be given effect237, and it is under the laws and customs of the Ngaliwurru and Nungali Peoples that the native title rights and interests in relation to the land are held by the Claim Group. 237 Yorta Yorta (2002) 214 CLR 422 at 440 [33]. See generally Mabo [No 2] (1992) 175 CLR 1 at 58, 59-61. Bell Nettle Gordon Trial judge The trial judge, in assessing compensation for cultural loss, first identified the nature and extent of the native title holders' connection or relationship with the land and waters by their laws and customs and, second, considered the effect of the compensable acts on that connection. As with the assessment of economic loss, that is also the appropriate approach to the assessment of cultural loss. Accordingly, before turning to consider the various grounds of appeal against the trial judge's determination of cultural loss, it assists to set out, in summary form, the trial judge's identification of the nature and extent of the native title holders' connection to country and the effect of the compensable acts upon it. The trial judge addressed cultural loss (albeit, using different terminology) under three headings – principles, findings and evidence, and consideration – and it is appropriate to restate them under the same headings. At the same time, it is important to recognise the need to read the trial judge's reasons as a whole. As will later become apparent, the Commonwealth and the Northern Territory sought to take particular parts of the trial judge's reasons and focus attention on those parts divorced from their place in the overall findings and reasoning. Principles After setting out that the claim for this component of compensation was made by the Claim Group on two bases – for loss from diminution in or disruption to traditional attachment to country and for loss of rights to live on, and gain spiritual and material sustenance from, the land – the trial judge identified various facts and matters which he considered were to be taken into account in assessing the effects of the compensable acts on the Claim Group's native title rights and interests. Those facts and matters were: the content of the native title rights and interests; the communal and collective nature of those rights and interests; the fact that the native title rights and interests were non-exclusive; and the fact that this component of compensation had to be assessed by reference to the loss or diminution of the native title rights and interests from the compensable acts and not from earlier, or subsequent, acts, events or effects. The trial judge described the assessment process as complex but essentially intuitive, with the compensation being assessed by reference to the spiritual and usufructuary significance of the area of the land affected relative to the other land that remained available to the Claim Group for the exercise of the native title rights and interests. It was in that context that the trial judge stated it Bell Nettle Gordon was necessary to bear in mind that prior to the town of Timber Creek being proclaimed in 1975, European settlement of the area had occurred with the establishment of cattle stations in the late nineteenth century, and that progressively the township became an important centre including from the 1930s, when roads were constructed in the region. As the trial judge recorded, those events would have led to the Claim Group being partly impaired from enjoying their traditional lands – before the compensable acts – and the current claim for compensation had to take into account the extent to which spiritual attachment to the land had already been impaired. The trial judge did not accept, however, that a compensation claim is to be reduced simply because there is other land over which a claim group may have native title rights and interests. Rather, his Honour stated that it is the consequences of the compensable acts on the native title rights and interests which are to be compensated and that those consequences do not exist in a vacuum uninformed by the wider areas in respect of which the Claim Group hold and enjoy their native title rights and interests238. Further, his Honour rejected the contention that the effect of the acts on native title rights and interests had to be direct. Those findings led his Honour to the conclusion that the Claim Group were entitled to compensation for the loss evoked or caused by the compensable acts but that any loss generally derived from a loss of access to country in the town of Timber Creek and the inability of the Claim Group to exercise their native title rights and interests on that country lay outside the parameters of s 51(1) of the Native Title Act239. Here, the nature and timing of the compensable acts had specific consequences for the assessment of the compensation claim. Many of the compensable acts occurred 30 or so years ago. As a result in part of that being so, the trial judge found that, in assessing the consequences of the compensable acts, it was not appropriate to adopt a lot by lot approach, treating each lot as a boxed quarter acre block240. That conclusion was also fortified by the fact that, consistent with the traditional laws and customs of the Ngaliwurru and Nungali Peoples, it was not possible to establish the comparative significance of one act over another; the consequences were necessarily incremental and cumulative and had to be understood in the terms of the pervasiveness of the Dreamings and the 238 Griffiths (2016) 337 ALR 362 at 420 [319]. 239 Griffiths (2016) 337 ALR 362 at 421 [323]. 240 Griffiths (2016) 337 ALR 362 at 421 [324]-[325]. Bell Nettle Gordon sites of significance. Thus, the trial judge found that, subject to the evidence before the Court, it was open to infer from evidence which did not specifically relate to an act or parcel of land that a further sense of loss was felt as a consequence of a compensable act241. As the trial judge correctly noted, not all groups will be the same and it is not sufficient to assess the effects of compensable acts by reference only to a statement of what would be the native title rights and interests were it not for extinguishment. Instead, the trial judge considered that evaluation of the compensable effects requires an understanding of the relevant effects of the acts on the Claim Group and that, in that respect, evidence about their relationship with country and the effect of the acts on that relationship is paramount. It is the trial judge's findings on those issues that are addressed next. Findings and evidence The trial judge addressed: the Claim Group's connection to the land; the effects, under their laws and customs, when country is harmed; and, then, the effects of the compensable acts. Again, it is appropriate to take each in turn. Connection to land Under s 86(1) of the Native Title Act, the trial judge received, uncontested, certain of the findings of, and evidence that was before, the trial judge in the native title determination application. The findings adopted242 included findings that: the native title holders were linked to the claim area through ancestral ties that go back to Lamparangana243, and well before his time; the native title holders observe essentially the same rituals and ceremonies as were practised by their ancestors more than a century ago; and that those ritual and ceremonial practices are largely and inextricably bound up with the land and waters in and around Timber Creek; 241 Griffiths (2016) 337 ALR 362 at 421 [326]. 242 Griffiths (2016) 337 ALR 362 at 421-422 [328]-[332]. 243 A senior land owner and relative of members of the Claim Group. Bell Nettle Gordon examples of ritual and ceremonial practices included high-order ritual practice, initiating rites, head wetting ceremonies (Mulyarp), protection of Dreaming (Puwaraj) sites, traditional methods of hunting, fishing and gathering food, and ongoing practice of ritual and exchange (Winan); the native title holders share a set of beliefs that govern the rights and obligations of Indigenous persons who wish to have access to, and use, the land and waters of the region and that those who were Yakpalimululu (senior owners of country) could deny access to certain foraging areas, and that if a white person wished to go onto Yakpali (country), that person would be expected to ask for permission; the purpose of such a request being to enable the protection of sites of importance to the Ngaliwurru and Nungali Peoples; according to the traditional laws and customs of the native title holders, spiritual sanctions are visited upon unauthorised entry onto country or, as the Full Court in the native title determination application described it, the native title holders are the gatekeepers for preventing harm to others and avoiding injury to country; certain restricted evidence, given before the trial judge in the native title determination application, pointed to a link between the symbols of the higher-order ritual, and proprietary interests in land. The rituals and ceremonies signal a right to country which stems from the Dreamings; there is in place, in Timber Creek, a system of normative rules that governs a continuing ritual tradition which articulates an "owner's" right to country that passes through descent; the laws and customs upon which the normative system rests are part of a conservative oral tradition that would be unlikely to be amenable to significant change; and the native title holders had a duty and concern to look after country. These findings require some further explanation. The trial judge made extensive reference to an expert anthropologists' report by Kingsley Palmer and Wendy Asche ("the Palmer and Asche 2004 Report") on the rights and duties under Ngaliwurru and Nungali law and custom to look after and speak for Bell Nettle Gordon country, which his Honour found was supported by the lay evidence of the claimants244. Palmer and Asche reported sites of significance in and around the claim area and the travels of major Dreamings through the claim area. Palmer and Asche explained that Dreamings are spiritual beings that performed actions that resulted in physical and spiritual modifications to the countryside. As some Dreamings ranged widely over the landscape their spirituality is believed to encompass more than one country. The relationship between an individual and the Dreamings is a personal one. Dreaming is regarded as an absolute force and its requirements and mandates have about them the immutable quality of law. Four major travelling Dreamings through Timber Creek were reported on, and documented in a map, by Palmer and Asche: Wirip (Dingo), Marna (Fish), Wuguru (Humpyback) and Lirimin (Centipede). The tracks the Dreamings took were also later documented alongside the locations of sacred sites on a map adopting the same data entered into the Northern Land Council's Geographic Information Systems to produce the map annexed to the Palmer and Asche 2004 Report. The later map was tendered before the trial judge. That map, shown below, identifies the lots on which the compensable acts occurred (in brown) as well as the sites of significance (marked with purple dots) and the tracks of the Dreamings (coloured in accordance with the key given). 244 Griffiths (2016) 337 ALR 362 at 423 [337]. Bell Nettle Gordon Bell Nettle Gordon The relationship between the spirituality of the Dreamings and the sites was described by Palmer and Asche in these terms: "In our view sites are a pivotal Dreaming reference and represent, in the applicants' belief, an important attestation of the powerful spirituality of the Dreaming. … [T]he power … underpins the system whereby the applicants consider their world to be ordered. … Sites are then far more than places or lists of named locations. They should also be understood as meta-place, that is a reference to a place is also a reference to a whole range of spirituality and associated imperatives that inform social exchanges, cultural activity and determine priorities." (footnote omitted) As the map illustrates, there were compensable acts on lots on which there are sites of significance. By way of example, on lot 79, where the compensable act was the grant of a lease to the Timber Creek Community Government Council, there is Yamalampu (site 36), and on the adjacent lot 47, where the compensable act was the grant of a lease to an individual, there is the Kunuma boab tree (site 35). That list is not exhaustive. There are also compensable acts which intersect with the Dingo Dreaming track: namely, acts 46 and 53245 on part of lot 70 and on lot 88 respectively. And, although several sites of significance are situated outside the claim area, numerous of those sites are adjacent or close to lots on which compensable acts took place including the old depot (site 7) adjacent or close to lot 16; Yamu (site 10) close to lot 88; and Wirip ngalur katpan (site 32) close to lots 20, 52 and 64. Again, that list is not exhaustive. Palmer and Asche observed that although country is defined by reference to named sites and by reference to the Dreamings which are believed to have ordained and sanctified the sites, many of the Dreamings wandered over areas of country with the result that their identity was not confined to bounded segments of the landscape but was pervasive. The sites were well understood as focal points of Dreaming spirituality, but not easily bounded. The Ngaliwurru and Nungali Peoples' connection to country is unique, deep and broad. To explain the fact and nature of the link between that connection and the harm caused by the compensable acts, the trial judge had to 245 As to the nature of those acts, see Northern Territory v Griffiths (2017) 256 FCR Bell Nettle Gordon first consider, in general terms, the effects under Ngaliwurru and Nungali laws and customs when country is harmed, before turning to consider the effects of the compensable acts. Effects under laws and customs when country is harmed The effects on the Ngaliwurru and Nungali Peoples under their traditional laws and customs, when their country is harmed, were illustrated by reference to four events that occurred in Timber Creek which were not the direct result of compensable acts. The first event was the building of a causeway across Timber Creek to the rear of lot 20, without asking for permission, that interfered with site 32, Wirip ngalur katpan (a Dingo Dreaming site), and which the native title holders believe caused the subsequent death of the man who built the causeway, in a car accident. This event requires further explanation. The Palmer and Asche 2004 Report referred to both the Wirip (Dingo Dreaming) – who is believed to have travelled from the west of the application area, south down the eastern side of the escarpment which forms the western wall of the Timber Creek valley, and eventually back to Timber Creek itself – and the site, at least at that time, of the caravan park – where the Dingo ended up as a rock in the creek. The track is marked in purple on the map. The Dingo was responsible for bringing the Winan and setting out its route. Palmer and Asche explained in a subsequent report ("the Palmer and Asche 2015 Report") that the mythological Wirip came and laid his spiritual presence under the rocks. The site of significance, Wirip ngalur katpan (site 32), appears adjacent to, not on, lot 20. The evidence disclosed that at some time during the last 20 years, a European man built a large concrete causeway across Timber Creek to create a swimming pool. In the Palmer and Asche 2015 Report it is estimated that the concrete extended for some 30 m across the creek, was 10 m wide and was placed partially on top of rocks, which were by then flooded and could not be seen. The claimants gave evidence of the effect of this act – it made them feel bad; they did not want the rock under the water, they wanted it on the water. JJ (now deceased) stated that the concrete causeway at that site: "blocked the tunnel and cut the life out of the Dreaming. It is still there but you can't see it any more. That Wirip Dreaming is very important to us. We use that Dreaming story when we have initiation for the young fellas. Now it's damaged for good and we can't tell the young fellas the Bell Nettle Gordon full story. If they can't see the Dreaming its [sic] hard for us older fellas to tell them the full Dreaming story they need to learn to grow up. There are many places in town where gardia [white people] have damaged sites that are important to Aboriginal people, and they stop us getting to places where we get bush tucker from. The dam at Wirip Ngalur Katpan, and the water tanks on the hill and Wilson Street, were built after the land claim with Justice Maurice. No one asked Aboriginal people for permission, which they should have. The water tanks were built right across the winan track near Kulungara (site 11), the cave on the hill. The resource centre in Wilson Street was built right on top of the helmet, or head dress, of the wirip. The water tanks are on the path of the wirip who brought the winan trade here. The old people used that track before us for the winan. Winan is an old Aboriginal trade that follows the Dreaming. Different Aboriginal groups along the trade route, and along the tracks where the Dreamings travelled, have to look after each other. Each group has to look after its bit of the Dreaming. If something goes wrong with our part, others think we are no good. That's what happened when all of these things have been built in the town. Other Aboriginal people complain about it and say that we are letting them down. It hurts my feelings when gardia do these things. They go ahead without talking to the old fella [AG (now deceased)] or me. When I see the Dreaming being damaged, I feel for my old people. I feel ashamed, like I've done the wrong thing myself in not looking after the country, the sites and the Dreaming. And [AG (now deceased)] gets cross with me. He says I am letting down the old people." The evidence about that event is significant: it explains the breadth and depth of the claimants' spiritual connection to the land; it explains that their loss of connection to country is incremental and cumulative and has to be understood in terms of the pervasiveness of the Dreamings and the significant sites; it explains the continued significance of site 32 on which the causeway was built, a site adjacent to lot 20, a lot where a compensable act took place; it explains that failed sense of responsibility to protect the land and, thus, it explains why that compensable act itself has a compensable effect which is not one dimensional. Bell Nettle Gordon The other events are significant for substantially the same reasons. The second event was the wish of the Commonwealth Department of Defence to construct and use a bridge over the Victoria River, just outside of the town ("the Army Bridge"), which resulted in payment of compensation to the native title holders in 2003. The site first proposed for the Army Bridge was near a Dingo Dreaming site, Palawa. AG (now deceased) gave evidence that he told the Army that they could not build the bridge on that site and while he remained worried that the bridge might still interfere with Marna (Fish Dreaming) because "they been cut the body of the barramundi wandiman who bin walk across", he agreed that the bridge could be built at the second location away from the Dreaming. The Palmer and Asche 2015 Report recorded that whilst the Army Bridge was the subject of consultations with the native title holders, some claimants regarded the structure as damaging "the spiritual essentialities of the Dreaming". The third event was the scraping of gravel from a site on the Dingo Dreaming without asking permission of the native title holders. A claimant (AG, now deceased) gave evidence that the person concerned was told to stop taking the gravel because it was cutting the Wirip's (Dingo's) body, and no more gravel was taken. Both AG (now deceased) and JJ (now deceased) told Palmer and Asche in 2011 that they were responsible for keeping the site safe and could get in trouble from other people if the site were damaged; that they felt guilt and shame about the damage done to the site; and that it made them feel no good inside and upset. As AG (now deceased) put it, "I feel bad every time I go down to see what been happenin'". The fourth event was a proposal to mine for diamonds on a hill on the edge of the town known as Japajani, a site which, under traditional laws and customs, was considered dangerous. AG (now deceased) gave evidence that no one went to the hill because they would die if they did. In addition to these events, the trial judge accepted246 the evidence of another claimant (JJ, now deceased) that non-Indigenous people should stay away from sites of significance including not going to, and fishing from, the water hole known as Tilwarni (site 49), a site of Wuguru (Humpyback Dreaming). As JJ (now deceased) put it, "you can't just walk into any European's 246 Griffiths (2016) 337 ALR 362 at 425-426 [345]. Bell Nettle Gordon little block of land and do what you want to do. And why they go onto Aboriginal land and do what they want to do?"247 Effects of the compensable acts It was against that background that the trial judge then considered the effects of the compensable acts the subject of the compensation claim. The trial judge referred generally to evidence led at trial by the Claim Group about the effects of loss of country and the effects of the compensable acts on the exercise of rights to country248. During the hearing of these appeals, the Claim Group (now deceased), Lorraine Jones and AG (now deceased); oral evidence given by JJ (now deceased), AG (now deceased), Chris Griffiths, Josie Jones and Lorraine Jones; and outlines of evidence given by Josie Jones and Roy Harrington. that evidence as affidavit evidence identified In considering that evidence it is necessary to say something about the notion of diminution in connection. As already explained, the connection is spiritual. That is, the connection is something over and above and separate from "enjoyment" in the sense of the ability to engage in activity or use. Spiritual connection identifies and refers to a defining element in a view of life and living. It is not to be equated with loss of enjoyment of life or other notions and expressions found in the law relating to compensation for personal injury. Those expressions do not go near to capturing the breadth and depth of what is spiritual connection with land. Some of the evidence of the claimants was general in nature – addressing the effect of acts being done on land without permission, and damage to the Dreamings, without expressly referring to particular sites of significance or areas of land, and therefore not expressly linked to any particular compensable act. But that is unsurprising. And it does not detract from the real and significant effects on the Ngaliwurru and Nungali Peoples' connection to country. The evidence given by two of the claimants, both of whom are now deceased, is illustrative. Some of the evidence given by JJ (now deceased) has 247 Griffiths (2016) 337 ALR 362 at 426 [347]. 248 See Griffiths (2016) 337 ALR 362 at 426 [348]. Bell Nettle Gordon already been addressed249. The evidence of AG (now deceased) was in similar terms: "Every time I come … there seems to be something new in Timber Creek. Each time something new. Might be a new building, a new road, or someone taking gravel. That hurts my feelings and makes me angry. … [G]ardia, white fellas, don't do the right thing. … Gardia put up fences and build things without asking us, and we can't get to our hunting grounds and where we get bush tucker. You can't do things on Aboriginal country without first asking the traditional owners. If you do things without asking then you get into trouble. There are places in Timber Creek where the Dreaming has been cut up. I gave evidence to Justice Weinberg about that in the Timber Creek native title claim. I told the Judge about what happened at Wirip Ngalur Katpan and how that white fella, [who built the causeway at Wirip Ngalur Katpan], died because he did the wrong thing. I told the Judge that if that white fella didn't die, he would have to pay. But that wouldn't fix the Dreaming up. He damaged the Wirip Dreaming. That dingo is still there but we can't see it anymore because of what that white fella did. If we can't see it, we have trouble telling our young fellas in initiation the story they need to know to grow up. … Those kinds of things make me angry and sad. When things go wrong like that then the old people; and other Aboriginal people, will think that I can't look after country properly. That makes me feel ashamed." After considering that evidence, the trial judge made the following further findings on the effects of the compensable acts: the effect of dispossession, being that unless the dispossession ends, the hurt feelings continue and are persistently aggravated250; 249 See [180], [182], [184] above. 250 Griffiths (2016) 337 ALR 362 at 428 [358]. See also Northern Territory v Griffiths (2017) 256 FCR 478 at 545 [263]. Bell Nettle Gordon by erecting fences and buildings, the acts impeded the exercise of native title rights and interests including access to hunting grounds, and there was also evidence of a reduction of bush tucker251; there was destruction or damage to significant sites, such as the construction of water tanks on the Dingo Dreaming on part of lot 70252, which is addressed in further detail below; the acts had effects on adjacent areas, which were still of importance to the Claim Group253, despite, for example, the area no longer being a secure ritual ground; and the acts impeded the ability of the Claim Group to practise their traditions and customs, even when the acts had not entirely destroyed that ability254. Significant evidence was given about the effect of the construction of water tanks in 1980 on part of lot 70, which were public works and a compensable act. The location of the tanks is marked on the map by the star on the Dingo Dreaming near the south-west border of lot 70. (now deceased) and AG (now deceased) gave evidence on country that the construction of the water tanks interfered with the Dingo Dreaming and the trade (Winan) for which the Wirip (Dingo) was responsible. Whilst on country, JJ (now deceased) put it in these terms: "Well, you look at that country what can I say there? No tank there. Why they got to build it up? Well, they've got a big mob of steel thing. Why they been build it up". The evidence of JJ (now deceased) was that in his heart the tanks should not be there, that it does not make him feel good and it hurts him – he feels puru maring. Palmer and Asche described puru maring as "[i]ntense personal feelings that accompany an act of spoiling" and likened it to English "gut wrenching". Other compensable acts on lots on which there are sites of significance were specifically addressed in the evidence. For example, in relation to the grant 251 Griffiths (2016) 337 ALR 362 at 428 [360]. See also Northern Territory v Griffiths (2017) 256 FCR 478 at 545 [264]. 252 See Griffiths (2016) 337 ALR 362 at 427 [352]. 253 Griffiths (2016) 337 ALR 362 at 428 [361]; see also at 432 [379]. 254 Griffiths (2016) 337 ALR 362 at 429 [362]. Bell Nettle Gordon lease of a the Timber Creek Community Government Council, JJ (now deceased) gave evidence that council buildings were built (on lot 79) where there is a site of Yamalampu (Spider Dreaming) (site 36). He explained: "We were told that it was gardia land and that a government Department in Darwin made a decision about where the Council buildings were to go. That's not right. It is our country, not gardia land. If we were asked, we would have told them to build it a long way away from Yamalampu like where the football oval is opposite the police station." JJ (now deceased) then said that it "hurts [his] feelings when gardia do these things"255. Josie Jones gave similar evidence about the adjacent lot 47, involving the grant of a lease to an individual on which there is the Kunuma boab tree (site 35). As the trial judge explained, the evidence revealed not only a duty but also a concern to look after country256. That evidence, given by the claimants, was found by the trial judge to be strong and compelling and the beliefs expressed were found to be genuinely held, demonstrating a deep connection to country257. In short, the trial judge found that the lay evidence, supported by Palmer and Asche, was that loss of, and damage to, country caused emotional, gut-wrenching pain and deep or primary emotions accompanied by anxiety for the Claim Group258. On the other hand, the trial judge accepted that the Claim Group's attachment to country was not entirely lost because, despite the development of the town and the fencing of some of the lots, the compensable acts did not remove all of the native title within the township of Timber Creek259, and referred to evidence that suggested that some developments in Timber Creek were acceptable under the traditional laws and customs of the Ngaliwurru and Nungali 255 See also [180] above. 256 Griffiths (2016) 337 ALR 362 at 425-426 [345]. 257 Griffiths (2016) 337 ALR 362 at 426 [348]. 258 Griffiths (2016) 337 ALR 362 at 426-427 [350]-[354]. 259 Griffiths (2016) 337 ALR 362 at 429 [364]; see also at 431-432 [377]. Bell Nettle Gordon Peoples. The developments that were acceptable to at least some members of the Claim Group were identified by the trial judge as including the construction of houses on Wilson Street, the construction of the Army Bridge, to which reference has already been made260, and the erection of the Ngaringman Resource Centre, where Indigenous law and custom recognised the helmet or headdress of the Wirip (Dingo) was located. Consideration The final aspect of the trial judge's consideration of the effects of the compensable acts was in four distinct, but interconnected, parts. First, his Honour found it was appropriate to have regard to considerations in r 9(2)(a)-(f) of Sch 2 to the Lands Acquisition Act (NT)261. As explained earlier, reference to the "rules for the assessment of compensation" set out in Sch 2 to that Act was permitted but not required. Next, the importance of the earlier section headed "Findings and evidence", although in parts general in nature, became evident. His Honour rejected the contention that there could be a significant area of landscape that is unimportant to Aboriginal peoples, or that there could be an area devoid of spirituality, stating that such a contention "defies logic in the Aboriginal tradition"262. His Honour then found that dispossession, and consequential injury to feeling, had occurred after generations of ongoing traditional but impaired connection, and had an "immediate effect to the native title holders"263. As his Honour described it, the effects were not limited to access to and use of the land but had to be understood by the bond that existed between a person and the Those findings bring together, and emphasise the importance of, his Honour's earlier findings, in particular that: in assessing the non-economic consequences of the compensable acts it was not appropriate to adopt a lot by lot 260 See [181] above. 261 Griffiths (2016) 337 ALR 362 at 430 [368]-[369]. 262 Griffiths (2016) 337 ALR 362 at 430 [370]. 263 Griffiths (2016) 337 ALR 362 at 431 [371]. 264 Griffiths (2016) 337 ALR 362 at 431 [372]. Bell Nettle Gordon approach, treating each lot as a boxed quarter acre block, given that many of the compensable acts occurred 30 or so years ago and because, under the traditional laws and customs of the Ngaliwurru and Nungali Peoples, ancestral spirits, the people, the country and everything that exists on it are to be viewed as one indissoluble whole; incremental and cumulative; it is not possible to establish the comparative significance of one act over another; and the loss was significant and keenly felt, and the effects of the acts had ongoing present day repercussions. the consequences were necessarily the assessment of Then, after again describing the appropriate compensation as a most complex one, the trial judge identified, and restated, particular considerations265: the Aboriginal spiritual relationship to land encompasses all of the country of a particular group, and not just "sacred sites"; the destruction of a particular sacred site may have implications beyond its physical footprint because of the spiritual potency of the site or because of the level of responsibility or accountability for the site which has not been honoured; the relationship of the Claim Group to their country, including Timber Creek, is a spiritual and metaphysical one which is not confined, and not capable of assessment on an individual small allotment basis; there were areas of country of particular significance to the Claim Group and other areas less significant; and the appropriate level of compensation must take into account the fact that prior to the compensable acts, there had been a progressive impairment of native title rights and interests but that the compensable acts did not remove all of the Claim Group's native title within the area. Finally, the trial judge referred to what his Honour described as "three particular considerations of significance to the assessment of the appropriate amount of compensation"266: the construction of the water tanks on the path of the Dingo Dreaming on part of lot 70, which had caused significant distress and concern; the extent to which certain of the compensable acts affected not only the precise geographical area of the lot on which the act took place but, in a more general way, related areas (described by the Full Court as "collateral detrimental effect"267); and the fact that each of the compensable acts to some degree "chipped away" at the geographical area resulting in incremental detriment to the enjoyment of the native title rights and interests over the entire area leading to a 265 Griffiths (2016) 337 ALR 362 at 431-432 [375]-[377]. 266 Griffiths (2016) 337 ALR 362 at 432 [378]; see also at 432 [379]-[381]. 267 See Northern Territory v Griffiths (2017) 256 FCR 478 at 552-554 [293]-[303]. Bell Nettle Gordon collective diminution of the Claim Group's cultural and spiritual connection with the land and a sense of failed responsibility, under the traditional laws and customs, to have cared for and looked after the land. These "three particular considerations" were the focus of significant parts of the arguments advanced by the Commonwealth and the Northern Territory in the Full Court and in this Court. Before identifying, and dealing with, those arguments it is necessary to say more about the three considerations identified by the trial judge. The evidence of the effect of the construction of the water tanks has been addressed268. The extent to which the compensable acts had a collateral detrimental effect has also been addressed269. Given the structure of and findings in the earlier parts of that section of the trial judge's judgment, it is unsurprising that his Honour referred to the collateral detrimental effect of the compensable acts. Collateral detrimental effect was and remains significant. His Honour illustrated the significance of this consideration by referring, in general terms, to gender-restricted evidence given about the effect upon the capacity of the Claim Group to conduct ceremonial and spiritual activities on an area adjacent to the compensable acts which he identified as a ritual ground ("the Restricted Evidence"). The Restricted Evidence was heard on country. It must be accepted that the Restricted Evidence does not clearly identify the adjacent lands as engendering feelings of hurt or loss in the Claim Group. Indeed, it is not easy to discern from the transcript what was conveyed to the trial judge there and then, including by gestures. It is apparent from the transcript, however, that the trial judge saw how proximate the lots in question are to the ritual grounds and it is clear that three compensable acts were adjacent to the identified area – acts 43 and 44 (which included the construction of houses) on lots 62 and 63, and act 59 (the construction of a public road leading to those lots). His Honour did not find that the effect of the compensable acts was the cessation of the use of the ritual ground; that had occurred some years earlier. Indeed, subsequently, the Claim Group performed the ritual elsewhere. What his Honour sought to explain was why he was taking account of the effects of compensable acts on an adjacent area – a ritual ground – as diminishing the cultural and spiritual connection of the Claim Group to those grounds when the 268 See [191] above; see also [180]. 269 See [190(4)], [199] above; see also [180]. Bell Nettle Gordon acts did not directly affect those grounds and the use of the grounds had already been significantly impaired by an earlier, non-compensable act. The answer his Honour gave was that an impairment of an Aboriginal person's spiritual connection to land is not to be understood by reference to what occurs on a particular lot or lots. It is to be understood more generally by reference to his or her feelings about loss of connection with country, which can be incremental. It was for those reasons that his Honour referred to the ritual ground to reinforce the fact that it would be wrong to consider each act in isolation. Each act affected native title rights and interests with respect to a particular piece of land. But each act was also to be understood by reference to the whole of the area over which the relevant rights and interests had been claimed. His Honour accepted that account must be taken of the extent to which spiritual attachment to land has already been impaired, but said that a further sense of loss "which does not specifically relate to an act or parcel of land"270 may be felt. The earlier acts, which were not compensable, punched holes in what could be likened to a single large painting – a single and coherent pattern of belief in relation to a far wider area of land. The subsequent compensable acts punched further holes in separate parts of the one painting, and the damage done was not to be measured by reference to the holes created by the compensable acts alone, but by reference to the effect of those holes in the context of the wider area: for example, an area which, as the trial judge found, remained important to the Ngaliwurru and Nungali Peoples despite the fact that the area was no longer able to be used as a ritual ground. This analysis reinforced what his Honour had said earlier: the consequences of acts can be incremental and cumulative; the people, the ancestral spirits, the land and everything on it are "organic parts of one indissoluble whole"; the effects on the sense of connection are not to be understood as referable to individual blocks of land but understood by the "pervasiveness of Dreaming"; the effects are upon an Aboriginal person's feelings, in the sense of his or her engagement with the Dreamings; an act can have an adverse effect by physically damaging a sacred site, but it can also affect a person's perception of and engagement with the Dreamings because the Dreamings are not site specific but run through a larger area of the land; and as a person's connection with country carries with it an obligation to care for it, 270 Griffiths (2016) 337 ALR 362 at 421 [326]. Bell Nettle Gordon there is a resulting sense of failed responsibility when it is damaged or affected in a way which cuts through the Dreamings. After recognising that the three particular considerations had been experienced by the Claim Group for some three decades and that the effect of the acts had not dissipated over time, his Honour found that the compensation should be assessed for the loss of cultural and spiritual relationship with the lots affected by the compensable acts for that period and for an extensive time into the future271. His Honour assessed the appropriate level of compensation at $1.3 million272. Full Court On appeal to the Full Court, the Commonwealth and the Northern Territory challenged the reasoning of the trial judge in respect of the three particular considerations to which reference has been made; put in issue the inclusion of an allowance for three decades or so of past loss, and loss for an extensive time into the future; and contended that the trial judge had failed to adequately address the Claim Group's alleged approval of acts on land over which they claimed native title rights and interests. Each appeal ground was rejected by the Full Court. The Full Court also rejected a contention that the compensation award was manifestly excessive273. The Full Court found that the award of $1.3 million was within the permissible range on the evidence, taking into account the nature of the rights and interests and the nature of the loss274. Thus, no occasion arose for that Court to reassess the amount to be awarded275. 271 Griffiths (2016) 337 ALR 362 at 433 [382]. 272 Griffiths (2016) 337 ALR 362 at 433 [383]. 273 Northern Territory v Griffiths (2017) 256 FCR 478 at 569-578 [379]-[420]. 274 Northern Territory v Griffiths (2017) 256 FCR 478 at 577 [412]. 275 Northern Territory v Griffiths (2017) 256 FCR 478 at 578 [420]. Bell Nettle Gordon Appeal grounds in this Court The grounds of appeal in this Court are set out at the start of these reasons. The various appeal grounds of the Commonwealth and the Northern Territory sought to raise, in substance, the same issues agitated before the Full Court, namely: the trial judge's treatment of the three particular considerations276; the inclusion of a component for the purported effect of compensable acts on future descendants of the Claim Group; (c) whether the trial judge had taken into account the extent of land that remained available to the Claim Group to exercise and enjoy their traditional rights, in comparison to the relatively small area of land that was subject to compensable acts; (d) what was said to be a failure of the trial judge to adequately address the Claim Group's alleged approval (by way of commercial agreements) of acts on land over which they claimed native title rights and interests; and (e) whether the compensation award was manifestly excessive. The Commonwealth also sought to argue, as part of the reason for contending that the award was manifestly excessive, that the Full Court had breached the rules of natural justice in having regard to certain material without giving the parties the opportunity to controvert or comment on that material. Assessment of cultural loss Before addressing the specific arguments raised before this Court, it is necessary to make some overarching observations. As explained above277, there were certain aspects of the approach to assessment of cultural loss that were not in dispute: that an award for cultural loss was appropriate; that the award was to be made on an in globo basis to the Claim Group with the apportionment or distribution of the award being an 276 See [200] above. 277 See [156]-[158] above. Bell Nettle Gordon intramural matter; that it would not be appropriate for the award to reflect the number of native title holders at the time that native title was determined to have existed given that the cultural loss would be suffered by the native title holders as a whole and because of the inter-relationships between members of related country groups and their relationships to the countries of those groups; and that the assessment of the effects of the acts for cultural loss could not be divorced from the content of the traditional laws and customs acknowledged and observed by the Claim Group. Moreover, the Commonwealth and the Northern Territory face the unanimous findings of fact to which extensive reference has been made. Those findings depended, in large part, upon the trial judge's assessment of the oral evidence given by the claimants, including his visit to country and his assessment of their connection to that country and the nature and extent of the effects of the harm to country caused by the compensable acts. As the trial judge said, the assessment was complex. Part of the difficulty arises because, in assessing the entitlement of the native title holders under s 51(1) of the Native Title Act to compensation on just terms for any loss, diminution, impairment or other effect of the act on their native title rights and interests, the Act requires compensable acts to be identified but, as the trial judge explained, the task then is to determine the essentially spiritual relationship which the Ngaliwurru and Nungali Peoples had with their country and to translate the spiritual hurt caused by the compensable acts into compensation. The grounds of appeal of both the Commonwealth and the Northern Territory, however, proceeded from a different, and incorrect, approach to the statutory task: that s 51(1) of the Act requires identification of a compensable act and, in assessing the effect of that act, s 51(1) imposes specific temporal and physical limits which do not extend to collateral detrimental effects. It does not. Section 51(1) provides for compensation on just terms for any loss, diminution, impairment or other effect of the act on native title rights and interests. The inquiries will vary according to the compensable act, the identity of the native title holders, the native title holders' connection with the land or waters by their laws and customs and the effect of the compensable acts on that connection. Thus, what might be an appropriate award of compensation will vary according to the results of those separate but inter-related inquiries. So, for example, as noted earlier, a sense of loss of connection to country resulting from the loss, diminution, impairment or other effect of an act on native title rights and interests in areas where land has been developed may prove less than the sense of loss of connection to country in relation to native title rights and interests in remote, less developed, areas. That is because, depending on the Bell Nettle Gordon facts of the case, the sense of connection to country may have declined in developed areas (with higher economic value) as a result of encroaching the act of extinguishment or other compensable developments before diminishment. Where that is so, the amount to be awarded for non-economic loss will be less. The court's task of assessment under s 51(1) is necessarily undertaken in the particular context of the Native Title Act, the particular compensable acts and the evidence as a whole. As the trial judge found, s 51(1) does not in its terms require that the detrimental consequence directly arise from the compensable act. The task required by s 51(1), as the sub-section itself recognises, requires a number of separate but inter-related steps: identification of the compensable acts; identification of the native title holders' connection with the land or waters by their laws and customs; and then consideration of the particular and inter-related effects of the compensable acts on that connection. In considering, and analysing, each of those separate but inter-related steps, the trial judge made extensive findings. Each act affected native title rights and interests with respect to a particular piece of land. But each act was also to be understood by reference to the whole of the area over which the relevant rights and interests had been claimed. As was explained earlier, each act put a hole in what could be likened to a single large painting – a single and coherent pattern of belief in relation to a far wider area of land. It was as if a series of holes was punched in separate parts of the one painting. The damage done was not to be measured by reference to the hole, or any one hole, but by reference to the entire work. Given those findings, it would be wrong to consider each compensable act in these appeals in isolation. What has already been said in these reasons rejects central elements of the arguments advanced in this Court on behalf of the Commonwealth and the Northern Territory. It is, however, necessary to say something more about particular aspects of those arguments. Three particular considerations Much of the argument in this Court was directed to a contention that the three particular considerations in the final section of the trial judge's reasons on the issue of non-economic, or cultural, loss were determinative of his Honour's justified reasoning (the Commonwealth and the Northern Territory taking issue in particular with the second and third considerations), the trial judge's entire reasoning was undermined. considerations was if none of that, and the Bell Nettle Gordon That contention proceeds from a misreading, or misunderstanding, of the trial judge's assessment of compensation for cultural loss. Given the complexity of the assessment task, focusing on one aspect of one part of the trial judge's reasons is apt to result in error. The structure, content and reasoning of the trial judge's judgment have been addressed278. As is apparent from that analysis, the contention that the three particular considerations in the final section of the trial judge's reasons on the issue of non-economic, or cultural, loss were determinative of his Honour's reasoning is not supported by a fair reading of those reasons. The use of, and reference to, the three particular considerations was to reinforce what his Honour had said earlier: the consequences of acts can be incremental and cumulative; the people, the ancestral spirits, the land and everything on it are "organic parts of one indissoluble whole"; the effects on the sense of connection are not to be understood as referable to individual blocks of land but understood by the "pervasiveness of Dreaming"; the effects are upon an Aboriginal person's feelings, in the sense of a person's engagement with the Dreamings; an act can have an adverse effect by physically damaging a sacred site, but it can also affect a person's perception of and engagement with the Dreamings because the Dreamings are not site specific but run through a larger area of the land; and as a person's connection with country carries with it an obligation to care for it, there is a resulting sense of failed responsibility when it is damaged or affected in a way which cuts through Dreamings. And it must be recalled that the trial judge did so in the context of the area of land that remained available to the Claim Group to exercise and enjoy their traditional laws and customs on country relative to the area the subject of the compensable acts279. That reasoning of the trial judge did not reveal legal error. It was the task required by s 51(1) of the Native Title Act: identification of the compensable acts; identification of the native title holders' connection with the land or waters by their laws and customs; and then consideration of the particular and inter-related effects of the compensable acts on that connection. As s 51(1) itself recognises, the steps are separate but inter-related. 278 See [159]-[208] above. 279 See Griffiths (2016) 337 ALR 362 at 417 [302], 420-421 [319]-[323]. See also Northern Territory v Griffiths (2017) 256 FCR 478 at 566-567 [370]-[373]. Bell Nettle Gordon Thus, the Full Court were right to reject the specific complaints made by the Commonwealth and the Northern Territory that the trial judge was wrong to give any weight to the second and third considerations – the extent to which the compensable acts affected not only the precise geographical area of the lot on which the act took place, and the fact that each of the compensable acts to some degree "chipped away" at the geographical area resulting in incremental detriment to the enjoyment of the native title rights and interests over the entire area leading to a collective diminution of the Claim Group's cultural and spiritual connection with the land and a sense of failed responsibility, under the traditional laws and customs, to have cared for and looked after the land. Contrary to the submissions of the Commonwealth and the Northern Territory, the trial judge would have been wrong not to take account of these matters. That is so given the nature and extent of the collateral detrimental effects of the compensable acts found by the trial judge280. Each effect was found by the trial judge to be "by the act". Each effect was, in a practical sense281, caused by the compensable act. A failure to take account of those effects in assessing the compensation claim would have ignored critical aspects of those findings – critical parts of the overall picture – and resulted in legal error. For those reasons, those complaints of legal error on the part of the trial judge should be rejected. Effect of compensable acts on future descendants The Commonwealth contended that the amount awarded by the trial judge, and upheld by the Full Court, erroneously treated future descendants of the Claim Group as suffering from compensable loss. That contention should be rejected. The trial judge was not asked to, and did not, make a finding that the compensable loss (or each compensable act) was suffered by a finite group of persons for a period of time which had a definite end point. Indeed, the description of the "native title holders" who were entitled to compensation under this claim was an agreed fact and was a description that enables the 280 See, eg, [168]-[208] above. 281 See Griffiths (2016) 337 ALR 362 at 420 [321], citing March v Stramare (E & M H) Pty Ltd (1991) 171 CLR 506; [1991] HCA 12. Bell Nettle Gordon composition of the group to be determined from time to time as the composition of the group changes as senior members die and new members are born. And it was because of the changing composition of the group that the trial judge recognised that, consistent with s 223(1) of the Native Title Act, the entitlement to compensation is a communal or group entitlement, which is of particular significance when assessing the effect of the compensable acts on cultural loss. The duration of the effect of the compensable acts was a factor the trial judge properly took into account282 and, as the Full Court explained, the loss is Those findings reflected the lay and permanent and intergenerational. anthropological evidence of the Claim Group's connection to the land and the effects, under their laws and customs, when country is harmed, including the effects of extinguishment would be anthropological evidence experienced differently by members depending on, for example, the person's connection to the place, and his or her age, ritual knowledge and responsibility. They were findings addressing the statutory question submitted by the parties for the determination by the Court; they were not findings directed to assessing whether the loss was suffered by a finite group that has an end point. that Moreover, as the Claim Group submitted, on determination of native title, Div 6 of Pt 2 of the Native Title Act provides that the Federal Court must make a determination about whether the native title is to be held on trust by a prescribed body corporate283 and, if such a determination is made, that prescribed body corporate has statutory functions to hold, invest and apply the compensation284. The compensation orders made by the trial judge reflect that statutory scheme. Approval of, and compensation for, acts At trial, the Claim Group tendered commercial contracts entered into by members of the Claim Group which contained provision for payments in the case of damage to, or destruction of, a sacred site. The Commonwealth contended that the trial judge should have considered the contracts and their terms. The Full Court rightly rejected that contention. 282 See, eg, [165], [190(1)], [198] above; see also [157]. 283 Native Title Act, ss 55 and 56. 284 Native Title Act, ss 56, 58(c), 94; Native Title (Prescribed Bodies Corporate) Regulations 1999 (Cth), reg 6. Bell Nettle Gordon As the Full Court recognised, not only did the trial judge consider the extent to which the Claim Group had considered interference with their native title rights and interests to be acceptable285, but the particular commercial contracts were not material to the assessment. The contracts provided pre-estimates rather than agreed fixed and final amounts of compensation; the contracts included additional terms, such as requiring the contracting party to remedy the damage or to reimburse the traditional owners for the cost of remedial action; and some of the contracts provided that the event (for example, the grant of a lease) did not extinguish native title rights and interests. Comparative material to controvert or comment on The Commonwealth contended that the Full Court erred in referring to materials – namely, three decisions of the Inter-American Court of Human Rights in relation to compensation awarded for non-pecuniary loss resulting from loss or impairment of traditional land rights and interests286, and a paper entitled "How Can Judges Calculate Native Title Compensation?"287 – without giving the parties an opportunity those materials. That contention should be rejected. The Full Court upheld the trial judge's award of compensation independently of, and before referring to, that material. With respect, it would have been preferable if the Full Court had eschewed that material or, had their Honours wished to mention it in the way they did, if they had brought it to the attention of the parties. Mentioning that material in their Honours' reasons without drawing it to the attention of the parties created the risk, which has eventuated, of a misapprehension that the material in part informed their decision, without the parties being afforded an opportunity first to be heard on it. But, for the reasons stated, it is plain that the Full Court reached their conclusion independently of the material. There was no denial of procedural fairness. 285 See [195] above. 286 See Northern Territory v Griffiths (2017) 256 FCR 478 at 573-576 [397]-[405] and the decisions cited therein. 287 See Northern Territory v Griffiths (2017) 256 FCR 478 at 576 [406]-[408], citing Burke, "How Can Judges Calculate Native Title Compensation?" (research project commissioned by the Native Title Research Unit of the Australian Institute for Aboriginal and Torres Strait Islander Studies, 2002). Bell Nettle Gordon Compensation award not manifestly excessive Having undertaken the necessary analysis, in relation to which no error has been demonstrated, a monetary figure had to be arrived at. To contend that an award is manifestly excessive invokes the last of the bases for appellate review in House v The King288: that the assessment is self-evidently wrong as involving manifest excess. The question for this Court is whether the amount is "so extremely high or so very small as to make it, in the judgment of this court, an entirely erroneous estimate of the damage"289. It is not. The trial judge – the judge who saw and heard the evidence – arrived at a figure of $1.3 million. His Honour had the substantial benefit of hearing, and seeing, first-hand the evidence from the Claim Group of their connection to the land; the effects, under their laws and customs, when country is harmed; and, then, the effects of the compensable acts on their connection to and relationship with country. That is reflected in the trial judge's detailed treatment of that evidence and related extensive findings, summarised in the preceding parts of these reasons. Given that this is the first compensation determination to come before this Court, then adapting and adopting what Mahoney A-CJ said in Crampton v Nugawela, what, in the end, is required is a monetary figure arrived at as the result of a social judgment, made by the trial judge and monitored by appellate courts, of what, in the Australian community, at this time, is an appropriate award for what has been done290; what is appropriate, fair or just291. The trial judge was not bound to approach the assessment with particular restraint or limitation292. An award of compensation of $1.3 million for the effects of the compensable acts on the Claim Group is an appropriate award. There is nothing 288 (1936) 55 CLR 499 at 505; [1936] HCA 40. 289 Lee Transport Co Ltd v Watson (1940) 64 CLR 1 at 13; [1940] HCA 27, quoting Flint v Lovell [1935] 1 KB 354 at 360. 290 (1996) 41 NSWLR 176 at 191, quoted in Griffiths (2016) 337 ALR 362 at 419 291 Crampton (1996) 41 NSWLR 176 at 195. 292 cf Skelton v Collins (1966) 115 CLR 94 at 129-132; [1966] HCA 14; Sharman v Evans (1977) 138 CLR 563 at 585; [1977] HCA 8. Bell Nettle Gordon to suggest that the trial judge's award would not be accepted by the Australian community as appropriate, fair or just. The amount is not so large that it suggests a failure to apply proper principles by reference to relevant considerations293. The amount awarded is not shown to be inconsistent with acceptable community standards, when it is recognised that this aspect of the award is compensation to the Claim Group, on just terms, for the effect of the compensable acts on their native title rights and interests – their cultural loss. Orders For those reasons, the following orders should be made: Matter Nos D1 of 2018 and D2 of 2018 Appeal allowed in part. Set aside Order 2 of the Orders of the Full Court of the Federal Court of Australia made on 9 August 2017 and, in its place, order that: "(1) Paragraph 3 of the further amended order made by the trial judge dated 24 August 2016 be set aside and, in its place, order: 'The compensation payable to the native title holders by reason of the extinguishment of their non-exclusive native title rights and interests arising from the acts in paragraph 1 above is: compensation for economic loss in the sum of interest on (a) in the sum of $910,100; compensation for cultural loss the sum of Total: $2,530,350. 293 See House v The King (1936) 55 CLR 499 at 505. Bell Nettle Gordon Note: post-judgment interest is payable on this total under s 52 of the Federal Court of Australia Act 1976 (Cth), accruing from 25 August 2016.' (2) Delete order 9." Matter No D3 of 2018 Appeal dismissed. Each party is to bear its own costs of these appeals. 240 GAGELER J. I agree with the proposed orders and reasoning in the joint reasons for judgment, subject to one qualification. The qualification concerns the methodology for assessing the economic value of a native title right. In the joint reasons, the economic value of the non-exclusive native title rights in this case is assessed as 50 per cent of the freehold value of the land in relation to which the rights exist. I arrive at the same assessment for different reasons. I agree that the economic value of a native title right to exclusive possession of land is ordinarily to be equated with the freehold value of the land in relation to which the right exists. However, I would not attempt to determine the economic value of a non-exclusive native title right simply by discounting from the freehold value of the land in relation to which the right exists. Instead, I adopt the conceptual framework indicated by the evidence of Mr Lonergan to the extent of recognising that the economic value of a native title right has two components. The first component is the value, if any, of the commercial exploitation of the native title right in perpetuity. The second component is the value of the native title holder's capacity voluntarily to surrender that right in order to facilitate the grant to someone else of a form of ordinary title which would allow the land to be put to its highest and best commercial use. Mr Lonergan referred to the first component as the "usage" value. He referred to the second component as the "exit" value or "negotiation" value. The negotiation value arises from the fact that native title operates as an obstacle to the grant of ordinary title, combined with the fact that native title can be surrendered so as to permit the grant of ordinary title to occur. The negotiation value is the value that a native title holder can extract from someone who wants a grant of ordinary title over the land in relation to which a native title right exists in order to put the land to its highest and best commercial use. Recognition of those two components of the economic value of a native title right allows the economic value of exclusive native title rights and non- exclusive native title rights to be assessed in the same way through a fairly straightforward adaptation of the Spencer test294. There is no need to treat a native title right as if it were alienable. All that is necessary, for the purpose of determining the economic value of a native title right, is to accept that the right can be the subject of an arm's length transaction in which the holder of the right is paid to surrender the right by someone who wants a grant of ordinary title over the land in relation to which the right exists. 294 Spencer v The Commonwealth (1907) 5 CLR 418 at 440-441; [1907] HCA 82. The holder of a native title right can be hypothesised to be willing but not anxious to surrender their native title right for payment secure in the knowledge that they will be separately compensated for cultural loss. Conversely, it is possible to hypothesise that someone will be willing but not anxious to obtain a grant of whatever form of ordinary title is necessary to put the land to its highest and best commercial use and, for that purpose, will be willing but not anxious to pay the native title holder to surrender their native title right. The holder of a native title right will have no economic incentive to surrender their native title right for less than the usage value of the right. Conversely, the seeker of ordinary title will have no economic incentive to offer more than the full value of the ordinary title for the surrender of the native title right. The usage value of an exclusive native title right can ordinarily be expected to equate to the full value of freehold title. There will be no difference between the lowest price that a native title holder will be prepared to accept and the highest price that a seeker of ordinary title will be prepared to offer for the voluntary surrender of the exclusive native title right in order to facilitate the grant of freehold title. Negotiating in good faith, the parties can be expected to agree upon a price that is equal to the full value of freehold title. In contrast, the limited nature of a non-exclusive native title right means that the usage value of the right can ordinarily be expected to be less than the full value of freehold title. There will be a difference between the lowest price that a native title holder will be prepared to accept and the highest price that a seeker of ordinary title will be prepared to offer for the voluntary surrender of the non-exclusive native title right. Negotiating in good faith, the parties can be expected to agree upon a price that lies somewhere between the usage value and the full value of freehold title. If each party is truly fair-minded, the price will be midway between the two. In this case, the non-exclusive native title rights were not found by the primary judge to have had any significant usage value. The economic value of the rights was hence confined to their negotiation value. The form of ordinary title which would allow the land to be put to its highest and best commercial use was accepted to be freehold title. Treating the usage value of the rights as close to zero, the economic value of the rights is therefore appropriately assessed as 50 per cent of the full value of freehold title. Edelman Introduction "To say that a small farm in the middle of a wealthy landowner's estate is to be valued without reference to the fact that he will probably be willing to pay a large price, but solely with reference to its ordinary agricultural value, seems to me absurd."295 So said the Master of the Rolls more than a century ago. That principle is now well established296. These appeals, conducted upon the premise that the Native Title Act 1993 (Cth) requires analogies to be drawn between Western concepts of title and the "other world of meaning and significance"297 of native title, involve the converse situation. They involve the valuation of title which is of great value to the dispossessed party but of no particular significance to the party obtaining the benefit of the extinguishment. A quarter of a century after the decision of this Court in Mabo v Queensland [No 2]298, the question on these appeals is how to calculate the reasonable price that should be paid to compensate native title claimants for the extinguishment of rights of immense cultural value. To say that the party obtaining the benefit of extinguishment, here the Northern Territory, should compensate a native title claimant, here the Ngaliwurru and Nungali peoples ("the Claim Group"), solely by reference to the ordinary value of the native title to non-Aboriginal persons is absurd. I have had the considerable benefit of reading the joint judgment prior to writing these reasons. I agree with the conclusions in the joint judgment and gratefully adopt the background discussion in that judgment. As to the elements described as economic loss and cultural loss, there is no single correct methodology of valuation. However, a key assumption made by the parties in this litigation was erroneous. The erroneous assumption was that the cultural loss should be assessed at the date of judgment. In submissions which attracted no demur from any other party, senior counsel for the Commonwealth accepted that a different valuation methodology could have been used, namely assessing cultural value at the date of 295 Inland Revenue Commissioners v Clay [1914] 3 KB 466 at 472. 296 Vyricherla Narayana Gajapatiraju v The Revenue Divisional Officer, Vizagapatam [1939] AC 302 at 316-317; MMAL Rentals Pty Ltd v Bruning (2004) 63 NSWLR 167 at 180 [73]-[75]; Earl Cadogan v Sportelli [2010] 1 AC 226 at 266 [2]. 297 Stanner, After the Dreaming (1968) at 44. 298 (1992) 175 CLR 1; [1992] HCA 23. Edelman extinguishment with the addition of simple interest until judgment. But he submitted that the result in this case would not be any different by applying that different methodology. In the absence of any challenge to the methodology adopted throughout this litigation by any other party and in the absence of any suggestion that the result in this case would have been different, I proceed upon that basis. But, although the result might not be affected in this case, the methodology adopted in this case is plainly erroneous. It is necessary to explain the error because the adoption of the same methodology in other cases could potentially title compensation. The reason why this is so concerns the underlying nature of the award of compensation for the extinguishment of native title rights. to systematic undervaluing of awards of native lead As to the measure of interest, I also agree with the conclusion in the joint judgment that interest should be calculated on a simple rather than a compound basis. The Native Title Act is concerned only with interest (i) as part of an award of compensation for proved loss, or (ii) upon an award of compensation for a period of deprivation of the use of money. There is no scope for the award of compound interest as a measure of restitution or as a measure of disgorgement of profits. Since it was not proved that the Claim Group would have invested any of the money received at compound interest, the measure of interest was not for a proved loss. It was interest for the period during which the Claim Group were deprived of the use of the money they should have received. There was only one period. There is no scope for the award of interest upon interest (compound interest) that occurs where there are multiple periods. In the course of these reasons I refer to "native title rights" consistently with the nomenclature of the Native Title Act299, where "native title" or, as used interchangeably, "native title rights and interests" is used to encompass those rights and interests that are not exclusive as well as those that are exclusive. However, the difference between the two concepts of exclusive native title rights and non-exclusive native title rights is not a difference of degree concerning whether a right to control access to the land is included within the so-called "bundle of rights" held by native title claimants. It is a difference of "kind"300 between an interest in the nature of a liberty to use the land and an interest in the nature of a right to control access to and exclude others from it301. 299 Section 223(1). 300 Western Australia v Ward (2002) 213 CLR 1 at 95 [94]-[95]; [2002] HCA 28. 301 Western Australia v Ward (2002) 213 CLR 1 at 82-83 [52]. Edelman The requirement for compensation Compensation was sought for 53 acts on 39 lots and four public roads. One aspect of the claim for compensation, described below as "economic loss" or "exchange value", concerned 31 acts on 31 lots. Another aspect of the claim for compensation, described below as "cultural loss" or "cultural value", was concerned with all 53 acts on all 39 lots. All but four of the 39 lots of land in this litigation were affected by (i) previous exclusive possession acts302 that permanently extinguished native title, or (ii) category D past acts303 that were followed by previous exclusive possession acts that permanently extinguished native title. In both of those categories, those previous exclusive possession acts extinguished native title304 and required payment of compensation305. Of the four exceptions, three lots were not affected by an act that extinguished native title306. Those three lots were the subject of Crown to Crown grants in perpetuity by the Northern Territory to government authorities307. Compensation was also required for those acts308. Although two of those three acts were used in the assessment of compensation for economic loss or exchange value309, the parties applied the principles of compensation to those acts as though they had extinguished native title. The Northern Territory described this approach as based upon a "pragmatic foundation that there is no foreseeable prospect of the revival of the native title rights and interests". That pragmatic approach is also adopted in these reasons. 302 Native Title Act, s 23B. 303 Native Title Act, s 232. 304 Native Title Act, s 23E and Validation (Native Title) Act (NT), ss 9H, 9J. See Northern Territory v Griffiths (2017) 256 FCR 478 at 490 [24]. 305 Native Title Act, s 23J. 306 See Native Title Act, s 23B(9C). 307 Acts 1 (part of lot 16), 36 (lot 52), and 41 (lot 60): see Griffiths v Northern Territory [No 3] (2016) 337 ALR 362 ("Griffiths") at 441 [428]; Northern Territory v Griffiths (2017) 256 FCR 478 at 488 [11]. 308 Native Title Act, ss 17(2), 20(1). 309 Acts 1 and 36. Edelman The fourth exception was a lot310 that was subject to the grant of a ten year Crown lease in 1986311. However, on 28 August 2006, a native title determination was made in favour of the Claim Group that, by operation of s 47B of the Native Title Act, "disregarded" the extinguishment of native title. The primary judge ignored the effect of this determination when assessing the compensation, thus treating the native title as having been extinguished312. The Full Court of the Federal Court of Australia held that the effect of the determination should not have been ignored. The act was treated by the Full Court as having extinguished native title but only until the time of the determination when the extinguishment was disregarded. Interest on the exchange value in relation to that lot was not awarded after 28 August 2006313. There was no application for special leave to appeal from this part of the Full Court's decision. Subject to that interest adjustment, which is also reflected in the interest rate used in the orders on these appeals, all the acts were therefore treated as having the effect of extinguishing the native title rights. Division 5 of Pt 2 of the Native Title Act provides a complete statement of the compensation payable for the acts314. Section 51 provides relevantly as follows: "51 Criteria for determining compensation Just compensation Subject to subsection (3), the entitlement to compensation under Division 2, 2A, 2B, 3 or 4 is an entitlement [sic: obligation] on just terms to compensate the native title holders for any loss, diminution, impairment or other effect of the act on their native title rights and interests." 310 Lot 47. 311 Act 34. 312 Griffiths (2016) 337 ALR 362 at 414 [282] and Order 1(6) at 447. 313 Northern Territory v Griffiths (2017) 256 FCR 478 at 540 [234], 590 [466]. 314 Native Title Act, s 48. Edelman "Compensation", in the sense in which it is used in s 51(1), has a well- established meaning. As Isaacs J said in MacDermott v Corrie315, in reasons with which the Privy Council agreed on appeal316, "[i]t simply imports that the exercise of the power of taking, or resumption ... will be accompanied by an equivalent in money of the property taken or resumed, or of the damage occasioned, being returned or given." There are, thus, two different concepts involved in compensation. The first is the "equivalent in money of the property taken" or, here, extinguished. That is the value of the rights extinguished. As I explain below, those rights must be valued at the date of taking or extinguishment. The second is "the damage occasioned". That is subsequent, consequential loss suffered. That damage is valued at the date of judgment. An act has an "effect" on native title rights and requires compensation to be paid if it extinguishes the native title rights or if it is otherwise wholly or partly inconsistent with their continued existence, enjoyment or exercise317. Since that extinguishing or inconsistent act is "taken always to have been valid"318, the compensation for the value of the native title rights extinguished by the validated act must be assessed at the date of the act, which is the time of extinguishment. In this case, the relevant date of the acts of extinguishment, or impairment in the case of the three Crown to Crown grants, was treated as 10 March 1994319. The approach to compensation in s 51(1) A general precept of the Native Title Act is equality of treatment between native title rights and other rights and interests where equivalent. The preamble to the Native Title Act concludes with reference to para 4 of Art 1 of the International Convention on the Elimination of All Forms of Racial Discrimination (1965) and the Racial Discrimination Act 1975 (Cth). Section 10 of the latter guarantees the equal enjoyment of rights irrespective of race, colour, or national or ethnic origin. When debating the 1998 amendments to the Native Title Act, Senator Minchin said that the "underlying premise of the Native 315 (1913) 17 CLR 223 at 247-248; [1913] HCA 27. 316 Corrie v MacDermott (1914) 18 CLR 511 at 517; [1914] AC 1056 at 1065. 317 Native Title Act, s 227. 318 Native Title Act, ss 19, 22F; Validation (Native Title) Act (NT), ss 4, 4A. 319 Griffiths (2016) 337 ALR 362 at 378 [77]. Edelman Title Act is to equate native title with freehold"320. Hence, in Western Australia v The Commonwealth (Native Title Act Case)321, six members of this Court explained that in regulating the competition between native title rights and other rights, "the Native Title Act adopts the legal rights and interests of persons holding other forms of title as the benchmarks for the treatment of the holders of native title". Consistently with this goal of parity of treatment, s 51(4) provides, as applied to this case, that in determining compensation for the extinguishment or impairment of native title rights, the court may have regard to the principles or criteria for determining compensation in a compulsory acquisition law of the Northern Territory (to whom the acts were attributable). The methodology adopted in this litigation The basic approach of all the parties, which was naturally followed by the primary judge and the Full Court, was to divide the compensation assessed under s 51(1) into two components, with one assessed at the date of extinguishment and the other assessed at the date of judgment. The first component was described as "economic loss" and was valued at the date of extinguishment of native title. It concerned the value of the native title rights without any allowance for the "cultural or ceremonial significance of the land, or of the very real attachment to the land which the Claim Group as an Indigenous community obviously has"322. To this component interest was added for the period from extinguishment until judgment. The second component was described as "solatium"323 and was valued at the time of judgment. But, as I explain below, it was not solatium in the sense in which that concept should be understood in the law concerning compulsory acquisition. The second component focused upon the cultural or ceremonial 320 Australia, Senate, Parliamentary Debates (Hansard), 3 December 1997 at 10231. See also Australia, House of Representatives, Parliamentary Debates (Hansard), 16 November 1993 at 2880. 321 (1995) 183 CLR 373 at 483; [1995] HCA 47. See also Western Australia v Ward (2002) 213 CLR 1 at 106 [122]; compare at 95 [94]-[95]. 322 Griffiths (2016) 337 ALR 362 at 405 [234]. 323 Griffiths (2016) 337 ALR 362 at 417 [300]. Edelman significance of the land to the Claim Group. It concerned the "loss or diminution of connection or traditional attachment to the land"324. At first blush, the methodology adopted by the parties in relation to the economic loss component appears nonsensical. What does it mean to speak of the economic value to a person holding native title of a right to engage in Aboriginal cultural activities independently of the cultural value of that right? How is it meaningful to value a right to access, maintain, and protect sites of significance to Aboriginal people, or to participate in exclusively Aboriginal cultural practices relating to birth and death, including burial rites, by ignoring the ceremonial significance of that right? The answer is that native title rights have two dimensions that must be valued separately to achieve parity of treatment with other rights. First, they have what can be described, for consistency with cases of compulsory acquisition, as an "exchange value" (although it is more accurately a "surrender value"). The exchange value is the price that would reasonably be paid by the person who wishes to extinguish the native title. It is not concerned with the cultural significance of the land. Compensation for that exchange value is an award for economic loss. Secondly, and consequently, there is the additional, and special, cultural value of the native title rights that is not captured by the exchange value. Neither of these two dimensions is dependent upon the particular subjective distress or mental suffering arising from the disruption to a person's life that follows the compulsory, rather than voluntary, nature of the deprivation of their rights. That is the province of an award of solatium. Awards described as "solatium"325 have also been made in different fields in law, including the field of personal injury such as for "distress and suffering caused by the death" of a 324 Griffiths (2016) 337 ALR 362 at 417 [300]. 325 Public Trustee v Zoanetti (1945) 70 CLR 266 at 272-273, 276, 285-286, 290-291; [1945] HCA 26; Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 150-151; [1966] HCA 40; Kaufmann v Van Rymenant (1975) 49 ALJR 227 at 230; 6 ALR 153 at 160; Jacobs v Varley (1976) 50 ALJR 519 at 523, 526; 9 ALR 219 at 227, 233-234; Astley v Austrust Ltd (1999) 197 CLR 1 at 19 [40]; [1999] HCA 6. Compare De Sales v Ingrilli (2002) 212 CLR 338 at 382-383 [126]; [2002] HCA Edelman relative326, and in the field of defamation for the degree of "indignity and humiliation" caused by the defamation327. The loss of the cultural value and the exchange value of the native title rights occurs immediately upon extinguishment. However, pain and suffering that is consequential upon the compulsory acquisition or extinguishment might occur slowly or gradually. That pain and suffering is measured at the date of judgment. The distress caused by the compulsory nature of the disruption "will vary greatly from case to case"328, although, in the most common cases of compulsory acquisition, the distress will generally involve similar feelings of frustration arising from being forced to relocate. In every case, solatium is based upon the particular person's injured feelings329, although it is sometimes capped at a fixed amount330 or 10 per cent of the price paid331. Although the parties used the language of "solatium", no separate claim was made in this litigation for such subjective mental suffering based only upon the consequences of the compulsory nature of the extinguishment. The exchange value of the native title rights The exchange value of the native title rights was sometimes described in this litigation as "economic value" and its loss as "economic loss". The Full Court held that the economic value of the native title rights fell to be 326 Public Trustee v Zoanetti (1945) 70 CLR 266 at 285. 327 Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 151. See also Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44 at 69-70, 104, 108; [1993] HCA 31. 328 Australia, Law Reform Commission, Lands Acquisition and Compensation, Report No 14 (1980) at 144 [271]. 329 March v City of Frankston [1969] VR 350 at 356, 358; Mayberry v Melbourne & (unreported, Supreme Court of Victoria, Metropolitan Board of Works 8 June 1970) at 16; Roberts v Commissioner for Main Roads (1987) 63 LGRA 428 330 See, eg, Land Acquisition (Just Terms Compensation) Act 1991 (NSW), s 60(2): 331 Cripps and Gordon, The Law of Compensation for Land Acquired Under See Land Acquisition and Compulsory Powers, 8th ed (1938) at 213. Compensation Act 1986 (Vic), s 44(1); Land Administration Act 1997 (WA), s 241(8)-(9), albeit with an override provision. Edelman assessed by reference to the Spencer approach332. That approach, enunciated by Griffith CJ in Spencer v The Commonwealth, is as follows333: "the test of value of land is to be determined, not by inquiring what price a man desiring to sell could actually have obtained for it on a given day, ie, whether there was in fact on that day a willing buyer, but by inquiring 'What would a man desiring to buy the land have had to pay for it on that day to a vendor willing to sell it for a fair price but not desirous to sell?'" The Spencer approach thus asks what price a willing but not anxious purchaser would pay to a willing but not anxious vendor in a hypothetical transaction. This hypothetical transaction approach is not a mandated legal rule. It is "merely a useful and conventional method of arriving at a basic figure [for exchange value] to which must be added in appropriate cases further sums for disturbance, severance, special value to the owner and the like"334. An extremely common application of the Spencer approach in land valuation cases includes considering sale prices of comparable land and adjusting those sale prices to reflect the characteristics of the land under consideration. One general difficulty with the use of agreed sale values in the circumstances of an imposed "forced taking" is that "the value of the process of agreement itself is denied to the native title holders"335. The answer to that concern may lie, as it does in cases of compulsory acquisition generally, in an award of solatium for the distress or inconvenience caused by the compulsory nature of the extinguishment. There is a more fundamental difficulty in an approach that relies upon agreed prices in actual negotiations. Agreed prices in actual negotiations are useful as part of a process of imagining a hypothetical negotiation between reasonable persons. The Spencer approach thus "presupposes a person willing to give what is being valued in exchange for money"336. The "necessary mental process"337 requires the prospect of a reasonable person "prepared to 332 Northern Territory v Griffiths (2017) 256 FCR 478 at 517 [122]. 333 (1907) 5 CLR 418 at 432; [1907] HCA 82. 334 Turner v Minister of Public Instruction (1956) 95 CLR 245 at 267; [1956] HCA 7, quoting Minister for Public Works v Thistlethwayte [1954] AC 475 at 491. 335 Bartlett, Native Title in Australia, 3rd ed (2015) at 794. 336 Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 225 [79]; 167 ALR 575 at 595; [1999] HCA 64. 337 Spencer v The Commonwealth (1907) 5 CLR 418 at 432. Edelman sell"338. But where no reasonable person in the position of the Claim Group would have engaged in such a process, the hypothetical negotiation cannot be undertaken. By definition, any hypothetical negotiation would not be concerned with a reasonable person in the position of the Claim Group who is willing to sell. In other words, the hypothetical negotiation "breaks down in a situation where any reasonable person in the claimant's position would have been unwilling to grant a release" or a surrender of the rights339. In this case, the primary judge held340, and the Full Court accepted341, that the Claim Group were not willing to surrender their native title rights. The position of the Claim Group was a reasonable approach for any person in their position to take in light of the cultural value to them of their rights. Indeed, it was never contended in this Court342 – and would have been contrary to the conclusions of the primary judge and the Full Court – that it was possible to conceive of a reasonable person in the position of the Claim Group who would have been prepared to surrender those native title rights. The absence of such a submission was unsurprising in light of the evidence from the Claim Group, supported by an expert anthropologists' report and accepted by the primary judge, that the "loss of and damage to country caused emotional, gut-wrenching pain and deep or primary emotions"343. For these reasons, the Spencer approach, or a version of it, cannot be applied by relying upon what reasonable persons in the position of the Claim Group might have sought to surrender their rights. Nor could the Spencer approach be applied, as the Northern Territory's expert economist, Mr Lonergan, considered it could, to ask what a reasonable person in the position of the Claim Group would have been prepared to pay to acquire other comparable land at a different location. It was not appropriate to attempt to value the reasonable price for this land on the basis of what the Claim Group might have been prepared to pay to acquire different land at a different location to which their attachment would have been different. 338 The Commonwealth v Arklay (1952) 87 CLR 159 at 170; [1952] HCA 76. 339 One Step (Support) Ltd v Morris-Garner [2018] 2 WLR 1353 at 1377 [75]; [2018] 3 All ER 659 at 682. 340 Griffiths (2016) 337 ALR 362 at 404 [232]. 341 Northern Territory v Griffiths (2017) 256 FCR 478 at 514 [111]. 342 Compare the submissions in Northern Territory v Griffiths (2017) 256 FCR 478 at 343 Griffiths (2016) 337 ALR 362 at 426 [350]. Edelman Although the Spencer approach cannot be applied without adaptation, it must be reiterated that the Spencer approach is no more than a common method of assessing the objective exchange value of rights. Where a hypothetical negotiation is not an appropriate mechanism because no reasonable person in the claimant's position would surrender the relevant rights, the exchange value is best measured by adapting the Spencer approach to focus only upon the price that a person in the position of the Northern Territory (as a willing but not anxious purchaser) would reasonably pay to obtain a surrender of the native title. One consequence of adapting the Spencer approach to focus only upon the price that a person in the position of the Northern Territory would reasonably pay for a surrender of the native title rights, rather than conducting a hypothetical negotiation with a person in the position of the Claim Group who would reasonably never have surrendered the rights, concerns the relevance of whether the land is located near a high-value, developed area or whether it is located remotely. In a hypothetical negotiation the consideration of the location of the land would be relevant to both parties. Other things being equal, in a hypothetical negotiation the party seeking to extinguish native title would pay more for the opportunity to use the land where it is located in a developed area. But a person in the position of the Claim Group might not demand as high a price if the development of the area meant that the loss of connection to country that would result from surrendering the rights was less significant. However, with a focus only upon the position of the Northern Territory it is only the former consideration that is relevant. The latter becomes a consideration in the assessment of cultural value. Another significant consequence of adapting the Spencer approach to focus only upon the price that the Northern Territory would reasonably pay to extinguish the native title rights is that any restrictions on alienation of the native title rights are irrelevant to the exchange value measure. A restriction on alienation is relevant, and potentially very significant344, where the question is what price would be sought by the person surrendering the right345. It is also significant when a purchaser is acquiring a right because a purchaser would pay a lower price for "an asset of which he could not, if need arose, freely dispose"346. 344 Sydney Sailors' Home v Sydney Cove Redevelopment Authority (1977) 36 LGRA 345 See Pastoral Finance Association Ltd v The Minister [1914] AC 1083 at 1088; The Commonwealth v Arklay (1952) 87 CLR 159 at 171. 346 The Commonwealth v Arklay (1952) 87 CLR 159 at 171. See also MacDermott v Corrie (1913) 17 CLR 223 at 233, 242-243, 246. Edelman But a restriction on alienation is irrelevant where the focus is only upon the price payable by the "purchaser" and the "purchaser" seeks to extinguish rights that affect the title and not to acquire them. When the rights are extinguished the title will be free from the restrictions. Hence, when considering provisions concerned to replicate compensation for compulsory acquisition "as nearly as possible"347, compensation for the extinguishment of a communal usufructuary title, otherwise equivalent to full ownership, is not reduced because that communal title cannot be sold or leased348. In summary, since the exchange value in the circumstances of these appeals focuses only upon the price that the Northern Territory would reasonably pay to extinguish the native title, aspects of the native title rights that are peculiar to the Claim Group, and which do not affect the Northern Territory, will not affect this assessment of exchange value. But at various points in the reasoning of both the primary judge and the Full Court the focus was not exclusively upon a reasonable person in the position of the Northern Territory. It was in part – and with respect to otherwise careful and elaborate judgments, erroneously – upon the Claim Group. The primary judge allowed elements peculiar to the Claim Group to interfere with his assessment of the exchange value to the Claim Group, being the price that the Northern Territory would reasonably pay to extinguish the native title. As the Full Court rightly observed349, there are points in the primary judge's reasoning where it appears that his Honour may have allowed elements of the value of the rights peculiar to the Claim Group to enter the assessment of the exchange value of the Northern Territory. The primary judge spoke of it not being routinely "appropriate" to treat the rights as if they were held by a non-Indigenous person and referred to the "true character" of the rights350. But that is the value to the Claim Group of using the land, which in this case is cultural value. The exchange value to the Claim Group is only the price that a reasonable purchaser would pay for extinguishment of the rights. the rights extinguished by In contrast, the Full Court was correct to conclude that in relation to this (exchange value) calculation "no allowance is made for the attachment of the 347 Geita Sebea v Territory of Papua (1941) 67 CLR 544 at 551; [1941] HCA 37. 348 Geita Sebea v Territory of Papua (1941) 67 CLR 544 at 557. See also Amodu Tijani v Secretary, Southern Nigeria [1921] 2 AC 399 at 409-411. 349 Northern Territory v Griffiths (2017) 256 FCR 478 at 514 [112]-[114]. 350 Griffiths (2016) 337 ALR 362 at 402 [212], 403 [220]. Edelman Claim Group to the land"351. However, the Full Court erroneously took into account the value to the Claim Group when assessing the exchange value by concluding that it was necessary to discount the exchange value due to the inalienable nature of the native title rights352. The inalienable nature of native title rights is an element of those rights relevant to the Claim Group. But a reasonable person in the position of the Northern Territory, seeking to have the rights extinguished, would be concerned only with the encumbrance that the rights impress on the title. They would not be concerned with the identity of the person who would exercise the rights. Hence, a reasonable person in the position of the Northern Territory would not be concerned with whether those rights are alienable. The Full Court also concluded that the benefit to the Northern Territory of extinguishing the native title rights was not relevant to the assessment of compensation353. Of course, the measure of compensation is ultimately for the value lost to the Claim Group, not the value gained by the Northern Territory354. But to determine the exchange value lost to the Claim Group it is essential to consider the benefits to the Northern Territory that affect the price that it would reasonably pay to extinguish the native title. Thus, as the joint judgment in this Court observes355, the benefit of extinguishment to the Northern Territory is relevant only to inform the price that it would reasonably have been prepared to pay and, hence, the exchange or surrender value of the native title to the Claim Group356. An appreciation of the proper method of determining the exchange value of the Claim Group's non-exclusive native title rights can be gained by a comparison with the method adopted to determine the price that would reasonably be paid to obtain the extinguishment of an easement. 351 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [137]. 352 Northern Territory v Griffiths (2017) 256 FCR 478 at 514-516 [115]-[119]. 353 Northern Territory v Griffiths (2017) 256 FCR 478 at 510-511 [89]-[92]. 354 See, eg, The Commonwealth v Reeve (1949) 78 CLR 410 at 418; [1949] HCA 22. 356 See MacDermott v Corrie (1913) 17 CLR 223 at 232-233, 251; Corrie v MacDermott (1914) 18 CLR 511 at 514; [1914] AC 1056 at 1062; The Commonwealth v Reeve (1949) 78 CLR 410 at 418. Edelman A comparison with extinguishment of an easement In the exercise of an evaluative judgment concerning compensation for extinguishment of an easement there are two extreme positions. At one extreme is compensation for extinguishing an easement that entirely excluded, for all time, all relevant uses of the land by the freeholder who is subject to the Compensation for extinguishment of the easement in those easement. circumstances would be valued at, or very close to, 100 per cent of the value of the freehold title. Close to this extreme is one case where the easement was over council land that was designated for parkland recreation. The easement permitted the full use of the surface, including erecting buildings on it subject to conditions. Pursuant to the easement, several large kiosks about 1.5 m high were constructed on a concrete slab. The encroachment was valued at 90 per cent of the freehold value of the land that was subject to the easement, after other restrictions were taken into account357. is awarded for the other extreme, limited compensation the extinguishment of an easement that has little or no effect on the relevant uses of the freeholder. One example of a limited effect is a case involving a lot subject to an easement permitting only a use for "tunnels, mains, pipes, and other works that do not project above the surface of the land"358, on which the plaintiffs had built a substantial boatshed. If the highest and best use of the lot were for a waterside residence, a purchaser would not be discouraged by the easement but would probably just incur some additional cost "mainly in the matter of foundations"359. The easement was valued at 9 per cent of the value of the land that was subject to the easement360. Another small percentage was awarded as the value of an easement to construct and maintain an electric transmission line over land mainly used for grazing cattle, where the easement did not deny the claimant the grazing use of the land and imposed limited restrictions as to matters including clearing and stockpiling of soil361. With one exception, the easement was valued at 16 per cent of the freehold value of the land that was subject to the easement362. 357 Ashfield Municipal Council v RTA of NSW [2000] NSWLEC 117 at [90]-[92]. 358 Rogerson v The Minister [1968] 2 NSWR 562 at 563. 359 [1968] 2 NSWR 562 at 564. 360 [1968] 2 NSWR 562 at 565. 361 Joyce v The Northern Electric Authority of Queensland (1974) 1 QLCR 171 at 174. 362 (1974) 1 QLCR 171 at 179. Edelman The exception was the area occupied by the bases of the electricity pylons and for a service road, where that part of the land was unusable and the full fee simple value of that part of the land was awarded363. An example of a case between these two extremes concerned an easement over a pastoral and grazing property364. The easement was for the purposes of erecting a high-voltage power line, including towers. The Court held that although the use of the land for grazing was not inevitably lost, even in the immediate vicinity of each tower, the easement caused a substantial loss of the ability to use the land within the easement for grazing purposes and the loss of 80 trees365. The Court accepted the assessment of the plaintiff's valuer that the value of the easement was 50 per cent of the freehold value of the area of land that was subject to the easement366. Application The departure by the primary judge and the Full Court from an assessment by reference only to the price that the Northern Territory would reasonably be prepared to pay to extinguish the native title requires reconsideration of the exercise of determining economic value. Like the example of the easement cases, there will be some instances where native title rights, if they co-existed with the freehold title, would have the effect of entirely sterilising the freehold title, or limiting it to "comparatively limited rights of administrative interference"367. The price that a reasonable person in the position of a freeholder would be prepared to pay to extinguish the native title would be close to, or equal to, 100 per cent of the freehold value. Such a circumstance will generally arise for native title rights that are exclusive. Those rights are the functional equivalent of freehold. For instance, as the order of the Court in Mabo [No 2] declared, the native title of the Meriam people, with the exception of the Islands of Dauer and Waier and certain other parcels, was an entitlement "as against the whole world to possession, occupation, use and 363 (1974) 1 QLCR 171 at 178. 364 Longeranong Pty Ltd v Electricity Trust (SA) (1990) 55 SASR 493. 365 (1990) 55 SASR 493 at 507-508. 366 (1990) 55 SASR 493 at 508. 367 Amodu Tijani v Secretary, Southern Nigeria [1921] 2 AC 399 at 410. Edelman enjoyment of the lands of the Murray Islands"368. The native title rights in this case are not exclusive. They are in the nature of a liberty. The area of land over which the extinguished native title rights in this case were exercised was approximately 127 hectares, or 1.27 square kilometres. The compensable acts were comprehensively described by the Full Court369, and included development leases, freehold grants to government authorities including for public works, and public works constructed without underlying tenure. Even assuming that each of the 53 compensable acts by the Northern Territory was the highest and best use of the land and would not have been possible without extinguishment of the title, Northern Territory, as a willing but not anxious "purchaser", would reasonably pay the full freehold value of the land to obtain that use. The reasonable price that it would pay depends upon other possible, and available, uses of the land, despite the existence of the native title. The existence of those other uses demonstrates value to the Northern Territory, without extinguishing native title. The other uses might also be relevant to the price at which the Northern Territory could sell the land, again subject to the native title rights. this does not mean that the In the circumstances of this case there are several important factors that all reduce the price that the Northern Territory, as a willing but not anxious "purchaser", would reasonably have been prepared to pay to extinguish the native title rights. First, the native title rights were not exclusive. As the Full Court observed, the native title rights did not prevent the Northern Territory from granting "co-existing rights and interests to others such as ... grazing licences, occupation licences, and miscellaneous licences"370. They also did not prevent the Northern Territory from granting mining licences that could co-exist with the Claim Group's native title371. Secondly, the native title rights were personal. The Claim Group could not permit others to enter upon, or use, the land372. The extent of the 368 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 217. 369 Northern Territory v Griffiths (2017) 256 FCR 478 at 485-488 [10]-[13]. 370 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [135]. 371 See Western Australia v Brown (2014) 253 CLR 507 at 527-528 [57]-[58]; [2014] HCA 8. 372 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [135]. Edelman encumbrance upon use by the Northern Territory was therefore strictly limited to those persons who held native title. Thirdly, the use to which the Claim Group could put the land was limited to particular purposes. For instance, they did not have the right to exploit the land, or control the mineral resources within it373, for commercial purposes374. The encroachment upon use by the Northern Territory did not extend to any of these commercial or resource control purposes. On the other hand, the native title rights were perpetual and extensive. As agreed by the parties and accepted by the Full Court375, the native title rights were the following non-exclusive rights in accordance with traditional laws and customs: the right to travel over, move about and to have access to the application area; the right to hunt, fish and forage on the application area; the right to gather and to use the natural resources of the application area such as food, medicinal plants, wild tobacco, timber, stone and resin; the right to have access to and use the natural water of the determination area; the right to live on the land, to camp, to erect shelters and other structures; the right to: engage in cultural activities; conduct ceremonies; hold meetings; 373 Western Australia v Ward (2002) 213 CLR 1 at 185 [382]. 374 Northern Territory v Griffiths (2017) 256 FCR 478 at 520 [135]. Compare Akiba v [528]; Akiba v Queensland [No 3] The Commonwealth (2013) 250 CLR 209 at 218 [5]; [2013] HCA 33. (2010) 204 FCR 1 at 134-135 375 Northern Territory v Griffiths (2017) 256 FCR 478 at 492 [33]. Edelman teach the physical and spiritual attributes of places and areas of importance on or in the land and waters; and participate in cultural practices relating to birth and death, including burial rights; the right to have access to, maintain and protect sites of significance on the application area; and the right to share or exchange subsistence and other traditional resources obtained on or from the land or waters (but not for any commercial purposes)." The evaluative exercise to determine the exchange value of a claim group's native title as a percentage of freehold value is not one of precision. It must necessarily be a broad-brush approach. This is particularly so in this case, where the assessment arises for the first time in relation to native title. Following the same approach to valuation as the easement cases, a broad assessment of the extent of the encroachment of the native title upon the fee simple title would be 50 per cent of the freehold value of the land. The amount that a person in the position of the Northern Territory would reasonably pay for a surrender of the Claim Group's native title rights, and thus the exchange value of the rights to the Claim Group, is therefore 50 per cent of the freehold value of the land. Although I do not accept the Commonwealth's submission that inalienability is a relevant discounting factor when considering the price that the Northern Territory would pay to extinguish native title rights rather than to acquire them, the cases involving a discount for inalienability to which the Commonwealth referred are of some limited assistance as comparators because they show the discount that arises as a consequence of a significant constraint. Those cases demonstrate that in the circumstances of compulsory acquisition, where alienability will generally be relevant, the discount for inalienability of the land ranged from 28 per cent of the freehold value (where there was a reasonable chance of rezoning)376 to two-thirds of the freehold value377, with many assessments clustered around 50 per cent378. The extent of the encroachment of 376 Liverpool City Council v Roads and Traffic Authority of New South Wales [2004] NSWLEC 543 at [60]-[62], [74]-[75]. 377 Hornsby Shire Council v Roads and Traffic Authority of New South Wales (1998) 100 LGERA 105 at 108-109. 378 Canterbury City Council v Roads and Traffic Authority of New South Wales [2002] NSWLEC 161 at [28]; Canterbury City Council v Roads and Traffic Authority of (Footnote continues on next page) Edelman the native title upon a fee simple title in this case might, in very rough terms, be compared with the discount upon an acquired freehold that is subject to a bar on alienation. An assessment of value amounting to 50 per cent of freehold value is appropriate in this case. The cultural value of the native title rights The nature of cultural value In conventional cases involving the valuation of land, the exchange value to the vendor will often include the value to the vendor of using the land, ie its use value. This is because the purchaser is assumed to buy the land for its highest and best use. But there are circumstances where the land has additional value to the vendor arising from a special use that the law recognises as a subject of compensation in addition to the exchange value. In this case, the "cultural value" of the land to the Claim Group was pleaded as "special value". In compulsory acquisition cases generally, a special use is exceptional. But in cases involving native title the special use, for cultural purposes, is entirely unexceptional. The special use of the land in native title cases is reflected in its cultural value, not in its exchange value. The modern origin of compensation above market value of the land for a special use is s 63 of the Land Clauses Consolidation Act 1845 (UK)379. That legislation permitted an award of compensation in excess of market value for the "special adaptability of land"380. Like the award of compensation representing the market value of the land, this subject of compensation also falls to be valued at the date of acquisition381. It "arises in circumstances in which New South Wales [2004] NSWLEC 172 at [16]; Blacktown City Council v Roads and Traffic Authority of New South Wales [2004] NSWLEC 772 at [12]; Roads and Traffic Authority of New South Wales v Blacktown City Council [2007] NSWCA 379 8 & 9 Vict c 18. 380 See, eg, In re Lucas and Chesterfield Gas and Water Board [1909] 1 KB 16 at 27- 28, 32, 35; Sidney v North Eastern Railway Co [1914] 3 KB 629; Browne and Allan, The Law of Compensation, 2nd ed (1903) at 659-683. See also In re Gough 381 Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 264 [265]; 167 ALR 575 at 647-648. Edelman there is a conjunction of some special factor relating to the land and a capacity on the part of the owner exclusively or perhaps almost exclusively to exploit it"382. In a passage in Pastoral Finance Association Ltd v The Minister383, which has been followed many times384, the Privy Council described an approach to measuring this value. The Privy Council was there considering how to measure the additional, "special value" to an owner above the market value of the land arising from his intended use of the land to conduct a business. The approach described by the Privy Council was to ask how much a prudent purchaser in the owner's special position "would have been willing to give for the land sooner than fail to obtain it"385. In Arkaba Holdings Ltd v Commissioner of Highways386, "this special value must in my view arise from some attribute of the land, some use made or to be made of it or advantage derived or to be derived from it, which is peculiar to the claimant and would not exist in the case of the abstract hypothetical purchaser. Would a prudent man in the position of the claimant have been willing to give more for this land than the market value rather than fail to obtain it or regain it if he had been momentarily deprived of it?" A neat example of special value given by Callinan J in Boland v Yates Property Corporation Pty Ltd387 is a blacksmith who has a protected non- 382 Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 269 [292]; 167 ALR 575 at 654. 383 [1914] AC 1083 at 1088-1089. 384 See, eg, The Commonwealth v Reeve (1949) 78 CLR 410 at 419-420; Turner v Minister of Public Instruction (1956) 95 CLR 245 at 266, 279, 292; Dangerfield v Town of St Peters (1972) 129 CLR 586 at 589-590; [1972] HCA 15; Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 225 [80], 245 [173], 279 [354]; 167 ALR 575 at 596, 623, 668. 385 Pastoral Finance Association Ltd v The Minister [1914] AC 1083 at 1088. See also The Commonwealth v Milledge (1953) 90 CLR 157 at 164; [1953] HCA 6; Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 226 [83]; 167 ALR 575 at 597. 386 [1970] SASR 94 at 100. See also Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 225 [80]; 167 ALR 575 at 596. 387 (1999) 74 ALJR 209 at 269 [292]; 167 ALR 575 at 654. Edelman conforming right, which will be lost on transfer of ownership, to use land located near a racecourse as a forge. The principles of special value, as enunciated, need not be confined to uses made of, or advantages derived from, land that can be immediately translated into money. Indeed, even in cases where the special value concerns a business prospect of financial gain to an owner, the increased or "special" value of the land is not the capitalised expected profits from the business but the amount that a purchaser in the position of the owner would reasonably pay to obtain the land388. Special value can encompass every matter of value to a claimant that extends beyond market value other than issues that are often described as mere "sentiment". A circumstance of special value pertinent to these appeals is the particular cultural value of native title rights. As the primary judge recognised, the cultural value that was lost comprised (i) the diminution or disruption in traditional attachment to country, and (ii) the loss of rights to live on, and gain spiritual and material sustenance from, the land389. The Native Title Act recognises that loss of this cultural value must be compensated. As Prime Minister Keating said in the second reading speech on the Native Title Bill 1993 (Cth)390, "any special attachment to the land will be taken into account in determining just terms". The exchange value to the Claim Group is the price that the Northern Territory would reasonably pay for the native title. But, from the perspective of the Claim Group, the price that the Northern Territory would reasonably pay for the surrender of the native title does not reflect all of this special, cultural value to them of the use of the land. Where, as in this case, the special value is a cultural value then, as is the case with personal injuries and other matters requiring a money figure to be placed upon matters that do not translate into money, "[a]ny figure at which the assessor of damages arrives cannot be other than artificial and ... the figure must be 'basically a conventional figure derived from experience and from awards in comparable cases'"391. The difficulty is further compounded where, again as in these appeals, there are no comparable awards. The advantage of the primary 388 Pastoral Finance Association Ltd v The Minister [1914] AC 1083 at 1088-1089. 389 Griffiths (2016) 337 ALR 362 at 416 [295]. 390 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 November 1993 at 2882. 391 Wright v British Railways Board [1983] 2 AC 773 at 777. Edelman judge, who makes the assessment from experience and in light of the evidence, is significant. Compensation for loss of cultural value is not solatium An award of cultural value in addition to exchange value is compensation to the Claim Group for loss of the cultural value to them of the native title rights. Expressed more fully, it is compensation for the value of the loss of attachment to country and rights to live on, and to gain spiritual and material sustenance from, the land. That value is lost at the moment of the act of extinguishment. The valuation of this cultural loss is distinct from the subsequent inconvenience and anguish caused by the compulsory manner in which the rights were extinguished. Compensation for the latter has traditionally been described as "solatium". Although the primary judge spoke of the compensation the Claim Group for "hurt feeling"392, this expression was not used in the sense in which it is used for solatium for two reasons. First, it was not a focus merely upon the compulsory nature of the acquisition or extinguishment. Secondly, the expression was not used to describe a particular mental state. Rather, it was used in the sense in which it had been explained in evidence by Professor Sansom in his 2015 report. He described hurt feeling as an "upset combined with justified indignation" belonging to a mob, and a "group-felt injury", where injury was used in the sense of any injustice or wrong. The "hurt feeling" is professed by a group in recognition of damage to country, which damage has been "taken into possession by the group to be owned by all its members". It is a description of the injustice rather than the mental state after extinguishment. At various times in the courts below, and in this Court, the parties sought to draw analogies between compensation for cultural loss and compensation for losses suffered in personal injury law. The analogy might be thought apt given the anthropological evidence that Aboriginal people "speak of 'earth' and use the word in a richly symbolic way to mean [their] 'shoulder' or [their] 'side'"393. However, as I have explained, the loss of cultural value is not a measure of mental state. It is quite different from the pain and suffering endured by an individual consequent upon a tortiously inflicted injury, including the suffering arising from the sense of injustice. The cogency of the analogy is, instead, that it serves to highlight the difference between two concepts. The first concept is the value that is lost at the moment of the personal injury. That is called loss of 392 Griffiths (2016) 337 ALR 362 at 421 [323]. 393 Stanner, After the Dreaming (1968) at 44, in part of a passage to which reference was made in the primary judgment: Griffiths (2016) 337 ALR 362 at 416 [294]. Edelman amenity. The second is the additional pain and suffering that is later felt as a consequence of the tort. The concepts of loss of amenity and pain and suffering, like the allied concepts of loss of cultural value and solatium, are closely related but distinct. They are closely related because the value of an amenity is derived, by experience, from the pleasure and fulfilment that it generally brings. Loss of amenity encompasses the lost ability to lead the life that the injured person could have chosen. Its value is thus based upon the lost pleasures of life, and will reflect the sense of injustice in the deprivation. That value is lost immediately upon loss of the amenity. An award for pain and suffering should, therefore, only be the additional, consequential pain and suffering later arising from the manner of the injury. The distinct nature of the awards can be clearly seen when compensation for loss of amenity is awarded even where there is no subsequent pain and suffering. In Skelton v Collins394, an award of damages for loss of amenity was upheld despite the appellant being permanently unconscious and without any present or future capacity to experience pain or suffering. As Kitto J said395, quoting H West & Son Ltd v Shephard396, the "fact of unconsciousness does not, however, eliminate the actuality of the deprivations of the ordinary experiences and amenities of life". Or, as Lord Pearce said in the latter case397, "[i]f a plaintiff has lost a leg, the court approaches the matter on the basis that he has suffered a serious physical deprivation no matter what his condition or temperament or state of mind may be". Nevertheless, although the deprivation represents a loss to any ordinary person, the inability to experience the deprivation meant that the award was necessarily "moderate"398. The same distinction exists in the law relating to valuation of losses from compulsory acquisition. Putting to one side losses arising from severance or injurious affection, the relevant distinction is between (i) a loss of the value of the land, being exchange value and any special value, and (ii) solatium, being the subsequent mental distress that arises from the compulsory nature of the acquisition. Even where the special value incorporates a loss of culture, and the valuation reflects the sense of injustice in the deprivation, the award for special 394 (1966) 115 CLR 94; [1966] HCA 14. 395 (1966) 115 CLR 94 at 103. 396 [1964] AC 326 at 349. 397 [1964] AC 326 at 365. 398 Skelton v Collins (1966) 115 CLR 94 at 101-102, 110, 132, 137. Edelman value is distinct from an award for any further, particular distress caused by the compulsory manner of the extinguishment. The erroneous assumption in this litigation The trial and the appeals in this litigation were all conducted on the assumption that the proper method of valuing the native title rights involved assessing: (i) the "economic", "exchange", or "surrender" value of the rights to the Claim Group, equal to the price that would reasonably be paid by a person in the position of the Northern Territory to extinguish the rights; (ii) interest on that amount; and (iii) the additional special value, beyond the exchange value, of the extinguished rights to the Claim Group. Although these appeals fall to be resolved by reference to that methodology, and although there is no single correct method of valuation, there is a basic flaw with it. That flaw is the assessment of cultural value at the date of judgment. Senior counsel for the Commonwealth accepted that the exercise of valuation could have been done by assessing both the exchange value and the cultural value at the date of extinguishment. Interest on both amounts would be added to solatium, with interest and solatium calculated at the date of judgment. No submissions were made as to why, as a matter of principle, the cultural value of the land should not be calculated at the date at which that cultural value was extinguished. Senior counsel for the Commonwealth, without demur from any other party, submitted that there would be no difference in result "in the end" because the assessment of cultural value at the date of judgment was measured in present day dollars, whilst the assessment of cultural value at the date of extinguishment or impairment would be in past money with the addition of simple interest. In the absence of submissions to the contrary, or any appropriate alternative valuation evidence in this proceeding, I proceed on this same assumption. However, the assumption is wrong in principle. As a matter of elementary economics it would be remarkable if inflation or a risk free rate as an estimate of the time value of money between 1994 and 2016 happened to coincide precisely with the rate of simple interest under the Federal Court Practice Note399. Even without the distortion of the compounding effect of the time value of money, the Practice Note rate over that period, as tables annexed to Mr Houston's report show, sometimes differed from the risk free rate by up to 8 per cent. Further, even if the two measures are seen as a rough approximation of each other, the 399 Federal Court of Australia, Pre-Judgment Interest, Practice Note CM 16 (2011), since revoked and superseded by Federal Court of Australia, Interest on Judgments, Edelman assumption could lead to an erroneous compensation award in other cases for at least three reasons. First, when there is a significant delay between the act that causes the extinguishment and the award of compensation, the expression of compensation for cultural loss at the date of judgment can give rise to an appearance of manifest excess, especially when compared with the freehold value. At the very least, the comparison can invite undue moderation. For instance, an award of $1,300,000 in this case for the cultural value of 1.27 square kilometres of land that has a freehold value of $640,500 might appear to be excessive. Indeed, this difference encouraged a strongly expressed submission by the Northern Territory and the Commonwealth, adopted by the Attorneys-General for South Australia and Queensland, that the cultural value was manifestly excessive. But the comparison invited in submissions is inapt. If cultural value is not expressed as a value at the date of the act of extinguishment then it should not be compared with the value of freehold at that time. If cultural value had properly been expressed as at the date of extinguishment, namely 10 March 1994, then it is unlikely that such a submission would have been made. The equivalent cultural value, using only simple interest to discount, and assuming no separate solatium, would be only $338,381400 on 10 March 1994, a little more than half of the freehold value. In other words, at the time of extinguishment, the combined exchange value and cultural value of the native title rights was approximately the same as the mere exchange value of the freehold title. Secondly, if the award of cultural value were truly a solatium for the pain and suffering of the members of the Claim Group after the compensable acts, and measured at the date of judgment, then the award ought to differ according to the particular pain, suffering and distress endured by the individual group members. It also ought to increase with an increase in the number of persons in the Claim Group. However, it was correctly assumed by the parties that the loss of culture would be unaffected by the size of the Claim Group and would be assessed "on an in globo basis", which did not require a focus on the pain and suffering of particular members401. Perhaps most fundamentally, the Native Title Act402 defines native title rights in terms that include communal rights. As the joint judgment observes403, the "native title holders" to be compensated were a 400 Extrapolating back from an award of $1,300,000 measured at the date of judgment and adopting the interest rate used by the Full Court. 401 Griffiths (2016) 337 ALR 362 at 419 [316]. 402 Section 223(1). Edelman group whose membership would change from time to time as new members are born and others die. Thirdly, by describing the cultural value of the land as solatium, the Claim Group conflated the different concepts of (i) loss of cultural value, and (ii) loss arising from the compulsory manner of the extinguishment. This meant that no separate award of solatium, properly so called, was sought for the additional distress caused by the compulsory manner of the acquisition. For reasons explained below, it might be doubted whether the award for loss of cultural value incorporated any such amount. Despite the erroneous nature of the parties' assumption, in circumstances where it was not challenged by any party, I proceed on the basis that in this case there would be no substantive difference between an award of $338,381 as at 10 March 1994, to which simple interest is added at the Practice Note rate, and an award of $1,300,000 as at the date of judgment. Application: the measure of the cultural value in this case The basis upon which the primary judge made the award for cultural loss and the nature of that award are described in detail in the joint judgment404. I agree with those reasons. I would add only the following. On the assumption of the parties that an award for cultural value of $1,300,000 at the date of judgment was not any different from the cultural value at the date of extinguishment plus simple interest, the latter amount, when added to the exchange value determined by this Court, gives a total value ($658,631) of the native title which is roughly approximate to the freehold value of the land ($640,500). Indeed, the amount in this case would be less than an award of compensation for a compulsory acquisition of freehold, because the freehold value would usually have added to it a component of solatium of up to 10 per cent to reflect the compulsory nature of the acquisition. Solatium, properly so called, was not separately sought in this case. In this case, the combined award of exchange value and cultural value as at the date of extinguishment therefore amounts to less than the award of compensation that would be made for the compulsory acquisition of the freehold over the same land with no special value. In comparison, the special, cultural value to the Claim Group included the spiritual sustenance derived from the land, "the product of the Dreaming ... considered to be inviolable"405. The value to the 405 Palmer and Asche, Timber Creek Native Title Application: Anthropologists' Report (2004) at 89 [9.2]. Edelman Claim Group of the native title rights was immense. The total award is plainly not excessive. With all the latitude afforded to the primary judge it is a reasonable, indeed a conservative, award. The operation of s 51A of the Native Title Act Section 51A provides relevantly as follows: "51A Limit on compensation Compensation limited by reference to freehold estate The total compensation payable under this Division for an act that extinguishes all native title in relation to particular land or waters must not exceed the amount that would be payable if the act were instead a compulsory acquisition of a freehold estate in the land or waters." Section 51A(2) provides that the section is subject to s 53. Section 53 provides a "safety net"406 entitlement to constitutional just terms compensation if the limit in s 51A would result in payment of compensation on other than the just terms required by s 51(xxxi) of the Constitution. On one view, the limit in s 51A would be engaged in this case. On the assumptions discussed above, the total amount of compensation, comprised of exchange value and cultural value, at the date of extinguishment without interest is marginally more than the freehold value. Of course, that assessment uses only simple interest as a discounting factor. The total compensation would be significantly less if cultural value were discounted by the compounding effect of the time value of money. However, the comparison invited by s 51A is not between the combined cultural and exchange value of native title and the exchange value only of freehold. The proper comparison is between the exchange value of the native title rights ($320,250) and the exchange value of the freehold ($640,500). Consistently with the parity principle underlying the Native Title Act, the goal of s 51A is to treat native title, where the native title rights are exclusive and extensive, in the same way as freehold title. In the Explanatory Memorandum to the Bill that introduced s 51A407, it was explained that the section was intended to 406 Australia, House of Representatives, Native Title Amendment Bill 1997, Explanatory Memorandum at 224 [24.10]. 407 Australia, House of Representatives, Native Title Amendment Bill 1997, Explanatory Memorandum at 224 [24.8]. Edelman "clarify the amount of compensation that native title holders can get" and that it "equates native title with freehold title for the purposes of the compensation provisions but it does not mean that native title will be regarded in all circumstances as equivalent to freehold". Although the members of the Parliamentary Joint Committee who considered the Bill expressed concern that it was "not clear to the Committee exactly how the capping provision will accommodate the special Indigenous attachment to land"408, the answer to this concern must be that to treat native title as equivalent to freehold title requires only that the exchange value of native title cannot be more than the exchange value of freehold. A person holding freehold title with some special value would not have the special value ignored for the purpose of compensation any more than a person holding native title should have the special value ignored for the purpose of compensation. This conclusion is reinforced by the comparison invited in s 51(2) to the terms of laws concerning compulsory acquisition. Those statutes409 are based upon the principle of assessing compensation according to the value to the owner410. It would violate the parity principle if compensation for the extinguishment of native title were required to ignore special value to the native title holder, despite it being permitted to the freeholder in many of the statutes. Interest The remaining issue is whether interest upon the value of the extinguished native title rights should be simple or compound. Both the primary judge and the Full Court held that the interest should be simple interest. 408 Australia, Parliamentary Joint Committee on Native Title and the Aboriginal and Torres Strait Islander Land Fund, The Native Title Amendment Bill 1997 – Tenth Report (1997) at [7.29]. 409 Lands Acquisition Act 1989 (Cth), s 55; Land Acquisition (Just Terms Compensation) Act 1991 (NSW), s 55; Land Acquisition and Compensation Act 1986 (Vic), s 41; Land Acquisition Act 1969 (SA), s 25; Acquisition of Land Act 1967 (Qld), s 20; Land Administration Act 1997 (WA), s 241; Land Acquisition Act 1993 (Tas), s 27; Lands Acquisition Act (NT), s 66, Sch 2; Lands Acquisition Act 1994 (ACT), s 45. 410 Nelungaloo Pty Ltd v The Commonwealth (1948) 75 CLR 495 at 571; The Moreton Club v The Commonwealth (1948) 77 CLR 253 at 257; [1948] HCA 21; The Commonwealth v Arklay (1952) 87 CLR 159 at 169; Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 212 [11], 279 [354]; 167 ALR 575 at Edelman Interest as part of compensation One route to the award of compound interest is for the interest to form part of the obligation in s 51 to "compensate the native title holders for any loss ... or other effect of the act on their native title rights and interests". It is immediately necessary to identify what is meant by "compensation". The term is used in s 51 in its nearly universally accepted sense, which focuses upon the claimant. It is consistent with the longstanding approach to compensation for compulsory acquisition, which focuses upon the effect on the owner411, replicated in the focus of the compensation provisions in the Native Title Act upon compensation to the "native title holders"412. This accords with the widely prevailing meaning of compensation adopted for decades in this Court. There are many authorities affirming that the role of compensation is to "put that party in the same position as he or she would have been in if the contract had been performed or the tort had not been committed"413. As Mason CJ, Dawson, Toohey and Gaudron JJ said in Haines v Bendall414, the concept of compensation was cognate with "the rule, described by Lord Reid in Parry v Cleaver415, as universal, that a plaintiff cannot recover more than he or she has lost". 411 Nelungaloo Pty Ltd v The Commonwealth (1948) 75 CLR 495 at 571; The Moreton Club v The Commonwealth (1948) 77 CLR 253 at 257; The Commonwealth v Arklay (1952) 87 CLR 159 at 169; Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at 212 [11], 279 [354]; 167 ALR 575 at 579, 668-669. 412 See Australia, House of Representatives, Native Title Bill 1993, Explanatory Memorandum: Part A at 3; Australia, House of Representatives, Native Title Bill 1993, Explanatory Memorandum: Part B at 29; Australia, House of Representatives, Parliamentary Debates (Hansard), 16 November 1993 at 2882. 413 Haines v Bendall (1991) 172 CLR 60 at 63; [1991] HCA 15. See Livingstone v Rawyards Coal Co (1880) 5 App Cas 25 at 39; British Transport Commission v Gourley [1956] AC 185 at 197, 212; Butler v Egg and Egg Pulp Marketing Board (1966) 114 CLR 185 at 191; [1966] HCA 38; Todorovic v Waller (1981) 150 CLR 402 at 412, 463; [1981] HCA 72; Redding v Lee (1983) 151 CLR 117 at 133; [1983] HCA 16; Johnson v Perez (1988) 166 CLR 351 at 355, 367, 371, 386; [1988] HCA 64; MBP (SA) Pty Ltd v Gogic (1991) 171 CLR 657 at 664; [1991] HCA 3. 414 (1991) 172 CLR 60 at 63. 415 [1970] AC 1 at 13. Edelman Compensation, understood in this manner, contrasts sharply with awards in cases, including a decision relied upon by the Claim Group416, based upon a gain to the defendant, of either restitution or disgorgement. Restitution of a gain reverses the value of an enrichment received at the plaintiff's expense. Restitution "does not seek to provide compensation for loss"417. As for an account and disgorgement of profits, this is a "prophylactic"418 principle. This prophylactic or deterrent purpose is a foundation for stripping profits from a wrongdoer419. It is also well established that disgorgement of profits is not concerned with compensating for loss420. Since s 51 is concerned only with awards of compensation it is unnecessary on these appeals to consider whether there exists any generalised principle, whether or not it could be described as "free standing"421, permitting compound interest as part of an award of restitution. Compound interest as a restitutionary award would not be concerned with loss and would not be compensatory422. Further, difficult issues, not addressed in submissions in this 416 Sempra Metals Ltd v Inland Revenue Commissioners [2008] AC 561. 417 Commissioner of State Revenue (Vict) v Royal Insurance Australia Ltd (1994) 182 CLR 51 at 75; [1994] HCA 61; Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516 at 529 [26]; [2001] HCA 68. See also Burrows, A Restatement of the English Law of Unjust Enrichment (2012) at 26, s 1(2). 418 Ancient Order of Foresters in Victoria Friendly Society Ltd v Lifeplan Australia Friendly Society Ltd (2018) 92 ALJR 918 at 923 [9]; 360 ALR 1 at 6; [2018] HCA 43; Conaglen, Fiduciary Loyalty: the Due Performance of Non-Fiduciary Duties (2010) at 80-84. Protecting 419 Keech v Sandford (1726) Sel Cas t King 61 at 62 [25 ER 223 at 223-224]; Warman International Ltd v Dwyer (1995) 182 CLR 544 at 557; [1995] HCA 18, quoting Meinhard v Salmon (1928) 164 NE 545 at 546. See also Jones, "Unjust Enrichment and the Fiduciary's Duty of Loyalty" (1968) 84 Law Quarterly Review 420 Birtchnell v Equity Trustees, Executors and Agency Co Ltd (1929) 42 CLR 384 at 408-409; [1929] HCA 24; Consul Development Pty Ltd v DPC Estates Pty Ltd (1975) 132 CLR 373 at 394; [1975] HCA 8; Chan v Zacharia (1984) 154 CLR 178 at 199; [1984] HCA 36. 421 The Commonwealth v SCI Operations Pty Ltd (1998) 192 CLR 285 at 316-317 [72]-[75]; [1998] HCA 20. 422 Sempra Metals Ltd v Inland Revenue Commissioners [2008] AC 561 at 585 [28], Burrows, The Law of Restitution, 3rd ed (2011) at 64-65. Edelman case, would need to be considered before that possibility is entertained. One issue is whether a claim for restitution of unjust enrichment should rationally be confined to the value immediately transferred to the defendant423. A second, related, issue is the value of analogies between, on the one hand, the benefit of an opportunity to use money and, on the other hand, the benefit of an opportunity to use other property424 or the benefit of the opportunity to use money unlawfully obtained425. A third issue is any incongruity that would arise by, on the one hand, not subjecting the defendant to a prima facie obligation to restore the value of the opportunity to profit from the use of money received by unjust enrichment yet, on the other hand, recognising a defence to the extent that the money is used unprofitably426. A fourth issue is the status and nature of authorities, discussed below, awarding interest at common law where a judgment is set aside. It is equally unnecessary to consider whether there should be a generalised principle permitting compound interest as part of an award of disgorgement of profits, beyond cases of breach of fiduciary duty and, despite some doubts427, fraud428. Even if such a generalised principle were recognised to require 423 Prudential Assurance Co Ltd v Revenue and Customs Commissioners [2018] 3 WLR 652 at 678-680 [68]-[75]. Compare Menelaou v Bank of Cyprus plc [2016] AC 176 at 188 [24]; Moore v Sweet 2018 SCC 52 at [43]-[44]; Mitchell, Mitchell and Watterson, Goff & Jones: The Law of Unjust Enrichment, 9th ed (2016) at 156-160 [6-17]-[6-29]; Burrows, The Law of Restitution, 3rd ed (2011) at 66-69. 424 See Clode, The Law and Practice of Petition of Right (1887) at 96, cited in National Australia Bank Ltd v Budget Stationery Supplies Pty Ltd (1997) 217 ALR 365 at 369; Heydon v NRMA Ltd [No 2] (2001) 53 NSWLR 600 at 605 [15]. See also Dimond v Lovell [2002] 1 AC 384 at 397. 425 Nelson v Nelson (1995) 184 CLR 538 at 571-572, 617-618; [1995] HCA 25. 426 Bant, The Change of Position Defence (2009) at 129-130. 427 Clef Aquitaine SARL v Laporte Materials (Barrow) Ltd [2001] QB 488 at 505, considering Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669 at 700-701; which I discuss and criticise in McGregor on Damages, 20th ed (2018) at 492-494 [15-039]-[15-044], 639 [19-068]. 428 President of India v La Pintada Compania Navigacion SA [1985] AC 104 at 116; Hungerfords v Walker (1989) 171 CLR 125 at 148; [1989] HCA 8; The Commonwealth v SCI Operations Pty Ltd (1998) 192 CLR 285 at 316 [74]. Edelman disgorgement of compound interest for wrongdoing beyond these categories429, and generalised to include investment profits made by the wilful wrongdoing of a defendant who is liable to account430, the principle would not be relevant to s 51 of the Native Title Act because disgorgement of compound interest profits made by a defendant is not "compensation"431. In order for an award of interest, including compound interest, to be made as part of a compensation award, the Claim Group would need to prove that they suffered a loss. That loss could be proved by showing that if the value of the native title rights had been paid to the Claim Group at the date of extinguishment, then they would have invested that money and would have earned interest on it432. The further question would then arise as to whether that loss from the failure to invest was an "effect of the act on their native title rights and interests"433. These issues do not arise. The primary judge was not satisfied that the Claim Group would have invested any payment made at the time of extinguishment to earn interest. As he explained, "on previous occasions where the Claim Group had collectively considered how funds should be applied, they had elected to distribute the funds for individuals or families to use"434. The power to award interest on compensation Whatever may be the position in the interpretation of different legislative provisions435, interest that arises only because of a delay in paying the 429 See, eg, Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669 at 692-693, 696-697, 735; Sempra Metals Ltd v Inland Revenue Commissioners [2008] AC 561 at 586 [32]. 430 American Law Institute, Restatement of the Law of Restitution: Quasi Contracts and Constructive Trusts (1937), §149 at 595-596; American Law Institute, Restatement of the Law Third: Restitution and Unjust Enrichment (2011), §49 at 431 Elliott, "Rethinking interest on withheld and misapplied trust money" [2001] The Conveyancer and Property Lawyer 313 at 321. 432 Hungerfords v Walker (1989) 171 CLR 125 at 143, 149-150, 152. 433 Native Title Act, s 51(1). 434 Griffiths (2016) 337 ALR 362 at 413 [275]. 435 See Swift & Co v Board of Trade [1925] AC 520; The Commonwealth v Huon Transport Pty Ltd (1945) 70 CLR 293; [1945] HCA 5; Marine Board of (Footnote continues on next page) Edelman compensation assessed under s 51 of the Native Title Act cannot be part of the award of compensation. It is not part of the compensation because it is not "for" an effect of the acts in extinguishing native title. Instead, interest for delay in the payment of compensation can only be interest on the compensation. Although interest for a delay in paying compensation is on compensation, the better view is that it is still within the terms of s 51 of the Native Title Act, which requires the compensation to be paid on "just terms". Again, this is a question of interpretation of the particular statute. The context of s 51(1) illustrates that the "just terms" of the obligation to compensate includes the power to order interest on that compensation. As Dixon J said in Marine Board of Launceston v Minister of State for the Navy436, the jurisdiction of a court to award compensation "may be readily interpreted as extending to what is consequential upon or incidental to the award". The reference in s 51 to the "just terms" upon which the obligation to compensate must be fulfilled reiterates the reach of the obligation to matters, such as interest, that are incidental to the award of compensation. Even assuming that s 51(xxxi) of the Constitution does not necessarily require the payment of interest for a delay in paying compensation for a compulsory acquisition437, the justice of the terms of payment of compensation must be understood against the background of the equitable rule that required the payment of interest upon unpaid purchase money and the analogy with that rule that had been drawn in cases of compulsory purchase of property. The principles and concerns revealed by that history demonstrate that the obligation to compensate on "just terms" will generally require interest on compensation but will not require compound interest. The history of an award of interest on compensation Common law Prior to 1829, there had been some argument at common law that the "constant practice"438 of ordering payment of interest where it had been agreed should, in justice, apply also to cases where there had been no agreement to pay Launceston v Minister of State for the Navy (1945) 70 CLR 518; [1945] HCA 42; Bank of NSW v The Commonwealth (1948) 76 CLR 1; [1948] HCA 7. 436 (1945) 70 CLR 518 at 533. 437 The Commonwealth v Huon Transport Pty Ltd (1945) 70 CLR 293 at 326; Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 300-301. 438 Craven v Tickell (1789) 1 Ves Jun 60 at 63 [30 ER 230 at 231]. Edelman interest439. However, long-established practice was to the contrary. In Calton v Bragg440, Lord Ellenborough CJ, Grose and Bayley JJ had said that interest on a "mere simple contract of lending" was never awarded without agreement. The restrictive rule was settled at common law in 1829 in Page v Newman441. Lord Tenterden CJ put the rule upon a curious premise. He said that to adopt a rule that allowed interest without agreement would require proof of a proper attempt by the plaintiff to obtain payment and that insistence upon such trials442. proof would be "productive of great Nevertheless, the general rule at common law was adopted in Australia with the effect that, in the absence of agreement, interest was not payable for a delay in payment of money that was due443. inconvenience" jury The general rule at common law was not absolute. One exception was in cases of money obtained and retained by fraud444. Another, and perhaps the best known common law exception, involved interest on an award of restitution rather than compensation. In Rodger v The Comptoir d'Escompte de Paris445, in an approach adopted in Australia446, the Privy Council held that interest was payable upon an order for restitution of money paid under a judgment that was set aside. The interest was ordered because "the perfect judicial determination which it must be the object of all Courts to arrive at, will not have been arrived at unless the persons who have had their money improperly taken from them have the 439 Arnott v Redfern (1826) 3 Bing 353 at 360 [130 ER 549 at 552]. 440 (1812) 15 East 223 at 226-227 [104 ER 828 at 830]. 441 (1829) 9 B & C 378 [109 ER 140]. 442 (1829) 9 B & C 378 at 380-381 [109 ER 140 at 141]. 443 Marine Board of Launceston v Minister of State for the Navy (1945) 70 CLR 518 at 525; Norwest Refrigeration Services Pty Ltd v Bain Dawes (WA) Pty Ltd (1984) 157 CLR 149 at 162; [1984] HCA 59. 444 Johnson v The King [1904] AC 817 at 822. 445 (1871) LR 3 PC 465. 446 Heavener v Loomes (1924) 34 CLR 306 at 323-324; [1924] HCA 10; The Commonwealth v McCormack (1984) 155 CLR 273 at 276-277; [1984] HCA Edelman money restored to them, with interest, during the time that the money has been withheld"447. Equity In contrast with the restrictive approach at common law, in cases involving a sale of land equity recognised that a purchaser in possession must pay interest to the unpaid vendor from the date of taking possession, or the date when the purchaser might reasonably have taken possession, until the date of the decree448. An early, but fictitious, rationale given by Sir William Grant was that the act of taking possession was "an implied agreement to pay interest"449. A more sophisticated rationale that emerged was that the defaulting purchaser in possession who retained the purchase money was the "trustee" of it for the vendor, at least to the extent that equity would decree specific performance, and must therefore account for the purchase money and interest450. Although the trustee analogy might now be doubted451, the obligation to pay interest was extended in equity by analogy from cases of sale of land to cases of compulsory acquisition of property under the Land Clauses Consolidation Act 1845 (UK)452. This extension was justified in that case because the "notice to treat under the statute [was] treated in equity as creating the relation of vendor and purchaser" of land453. 447 Rodger v The Comptoir d'Escompte de Paris (1871) LR 3 PC 465 at 475-476. 448 Esdaile v Stephenson (1822) 1 Sim & St 122 at 123 [57 ER 49 at 50]. 449 Fludyer v Cocker (1805) 12 Ves Jun 25 at 27-28 [33 ER 10 at 11]. See also Swift & Co v Board of Trade [1925] AC 520 at 532; Lawrence v Broderick (1974) 1 BPR [97004] at 9117. 450 Birch v Joy (1852) 3 HLC 565 at 590-591 [10 ER 222 at 233]; International Railway Co v Niagara Parks Commission [1941] AC 328 at 345; In re Priestley's Contract [1947] Ch 469 at 479-480; Sugden, A Practical Treatise of the Law of Vendors and Purchasers of Estates, 3rd ed (1808) at 353-356. 451 Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 at 332-333 [53]; [2003] HCA 57; Swadling, "The Fiction of the Constructive Trust" (2011) 64 Current Legal Problems 399. 452 In re Pigott and the Great Western Railway Co (1881) 18 Ch D 146 at 150. See also Fletcher v Lancashire and Yorkshire Railway Co [1902] 1 Ch 901 at 909. 453 Swift & Co v Board of Trade [1925] AC 520 at 532. Edelman The need for a relationship of vendor and purchaser was eventually abandoned by equity and the power to award interest was recognised by the Privy Council in all cases of compulsory "acquisition" of land454. Although the earlier rationale based upon the trust that arose in a sale of land was a reason why the courts did not further extend the equitable rule to the compulsory acquisition of goods455, in 1945 the equitable rule was used in Australia to justify the award of interest on statutory compensation for the compulsory acquisition of a ship where a contract for its sale could have been the subject of specific performance456. However, Dixon J decided the case on the broader footing of the power being a matter of statutory construction without necessarily confining the power to the availability of specific performance of a contract for the sale of the subject matter457. Admiralty Admiralty took the same approach as equity, at about the same time, but without the need for a rationale based upon a trust. In Shaw Savill and Albion Co Ltd v The Commonwealth458, Dixon CJ quoted from Dr Lushington459, saying: "Upon what grounds, then, was interest given? Interest was not given by reason of indemnification for the loss, for the loss was the damage which had accrued; but interest was given for this reason, namely, that the loss was not paid at the proper time. If a man is kept out of his money, it is a loss in the common sense of the word, but a loss of a totally different description, and clearly to be distinguished from a loss which has occurred by damage done at the moment of collision". With the exception of limited circumstances, such as delay by the plaintiff, an award of pre-judgment interest in Admiralty became "well-nigh 454 Inglewood Pulp and Paper Co v New Brunswick Electric Power Commission [1928] AC 492 at 498-499. 455 Swift & Co v Board of Trade [1925] AC 520 at 532. 456 Marine Board of Launceston v Minister of State for the Navy (1945) 70 CLR 518 at 527, 534-535, 537-538; Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 457 Marine Board of Launceston v Minister of State for the Navy (1945) 70 CLR 518 at 458 (1953) 88 CLR 164 at 166-167; [1953] HCA 24. 459 The Amalia (1864) 5 New Rep 164n. Edelman automatic"460. In President of India v La Pintada Compania Navigacion SA461 Lord Brandon of Oakbrook said that the interest awarded in damage actions should be extended to salvage actions but emphasised that the award of interest "does not involve, and never has involved, the award of compound interest, and again there is no authority in any reported Admiralty case for the award of interest of that kind". Such an award would never have occurred to any experienced Admiralty lawyer462. Statute At the same time as equity and Admiralty were developing awards of interest on compensation, the same approach was being taken in legislation. The first law was a limited power in s 28 of the Civil Procedure Act 1833 (UK)463 to award interest on judgment debts or awards of damages. Statutory interest was generalised on a wide scale in England with the enactment of the Law Reform (Miscellaneous Provisions) Act 1934 (UK) following the report of the Law Revision Committee presented to Parliament in that year. In the published report, the Committee observed464: "In practically every case a judgment against the defendant means that he should have admitted the claim when it was made and have paid the appropriate sum for damages. There are of course some cases where it is reasonable that he should have had a certain time for investigation, and in those cases the Court might well award interest only from the date when such reasonable time had expired. This is often done at present in claims under insurance policies. There is no doubt that the present state of the law provides a direct financial motive to defendants to delay proceedings." In Australia, general statutory interest provisions now exist in State, Territory and federal courts legislation which generally provide for the award of 460 Masters v Transworld Drilling Co (1982) 688 F 2d 1013 at 1014. 461 [1985] AC 104 at 120. See also Polish Steam Ship Co v Atlantic Maritime Co [1985] QB 41 at 50-51. 462 [1985] AC 104 at 121. 463 3 & 4 Will 4 c 42. 464 Great Britain, Law Revision Committee, Second Interim Report (1936) Cmd 4546 Edelman interest upon judgment debts and damages465. The rationale for the statutory interest was explained by Lord Wright, a member of the Law Revision Committee that had generalised the provision for statutory interest, in Riches v "The general idea is that he is entitled to compensation for the deprivation. From that point of view it would seem immaterial whether the money was due to him under a contract express or implied or a statute or whether the money was due for any other reason in law. In either case the money was due to him and was not paid, or in other words was withheld from him by the debtor after the time when payment should have been made, in breach of his legal rights, and interest was a compensation, whether the compensation was liquidated under an agreement or statute, as for instance under s 57 of the Bills of Exchange Act, 1882, or was unliquidated and claimable under the Act as in the present case." The rationale in equity, in Admiralty, and under statute In all of the instances discussed above involving interest on compensation at common law, in equity, in Admiralty, and under statute, the interest was not awarded for a proved loss. A claim for interest based upon proved losses from the failure to obtain money would be interest as part of the compensation award467. This type of claim for interest is "a loss like any other"468 and could attract compound interest if that is what was lost. In contrast, the award of interest on compensation or interest on a debt "is no part of the debt or damages claimed, but something apart on its own"469. 465 Federal Court of Australia Act 1976 (Cth), s 51A; Civil Procedure Act 2005 (NSW), s 100; Supreme Court Act 1986 (Vic), ss 58-60; Supreme Court Act 1935 (SA), s 30C; Civil Proceedings Act 2011 (Qld), s 58; Supreme Court Act 1935 (WA), s 32; Supreme Court Act (NT), s 84; Court Procedures Act 2004 (ACT), s 7, Sch 1, item 20; Court Procedures Rules 2006 (ACT), r 1619. Compare Supreme Court Civil Procedure Act 1932 (Tas), ss 34-35. 466 [1947] AC 390 at 400. See also Prudential Assurance Co Ltd v Revenue and Customs Commissioners [2018] 3 WLR 652 at 680 [76]; [2019] 1 All ER 308 at 467 Hungerfords v Walker (1989) 171 CLR 125. 468 BritNed Development Ltd v ABB AB [2018] 5 CMLR 37 at 1693 [545]. 469 Jefford v Gee [1970] 2 QB 130 at 149. Edelman The reason why interest is awarded, as "something apart", on the amount that would otherwise be due as compensation is that the plaintiff has been kept out of the money for a period of time. The cases, and the rationale of the legislation, emphasise the concern that the plaintiff be compensated for being deprived for a period of time of the payment that should have been received. However, the period is only a single period. The plaintiff has not been kept out of money for a period of time, then kept out of the money and interest for a further period, then the money and the interest and interest on the interest for a further period, and so on. This is why the interest awarded in Admiralty, or on default of payment by a purchaser of land, or under the various statutes, was never compound interest. There may, however, be some tension between, on the one hand, recognising that there is only one period of deprivation and, on the other hand, recognising that simple interest over that period does not fully reflect the extent of the deprivation as measured in commercial terms. That conflict was generally resolved by generous assumptions made by legislatures and the common law in the rate of interest. Those assumptions often used a single rate for clarity. In Calton v Bragg470, Lord Ellenborough CJ said that "[i]t is not only from decided cases, where the point has been raised upon argument, but also from the long continued practice of the Courts, without objection made, that we collect rules of law". The long-established conservatism was not limited to an insistence that the interest be for a single period. It also extended to a strong reluctance to depart from the rate of interest. For instance, the interest awarded by the Admiralty courts in England and Australia in limited liability actions471 was set at 4 per cent for more than a century472. More recently, in England the rate has generally been set at a market borrowing rate of base rate plus 1 per cent following the practice, under statute473, of the Commercial Court474. In Asiatic Steam Navigation Co Ltd v The Commonwealth475, this Court refused to depart 470 (1812) 15 East 223 at 226 [104 ER 828 at 830]. 471 Compare The Mecca [1968] P 665 at 673; Roscoe and Hutchinson, The Admiralty Jurisdiction and Practice of the High Court of Justice, 5th ed (1931) at 364-365. 472 The Theems [1938] P 197 at 201; Asiatic Steam Navigation Co Ltd v The Commonwealth (1956) 96 CLR 397 at 421; [1956] HCA 82; The Abadesa [No 2] [1968] P 656 at 664. 473 Law Reform (Miscellaneous Provisions) Act 1934 (UK), s 3. 474 Cremer v General Carriers SA [1974] 1 WLR 341 at 355-356; [1974] 1 All ER 1 at 14-15; Polish Steam Ship Co v Atlantic Maritime Co [1985] QB 41 at 67. 475 (1956) 96 CLR 397 at 420-421. Edelman from a rate of 4 per cent, although acknowledging that the rate of interest upon a judgment was 5 per cent, and that the 4 per cent rate was low according to the economic conditions. The Court referred to the lack of change in the rate for more than a century and reiterated the reason given by Dixon J for refusing to change the 4 per cent rate when awarding interest in equity for the purpose of adjusting rights on legacies476. That reason was stability: marked fluctuations in interest rates over time have "rather confirmed the policy of the court in fixing for its purposes a rate which over a long period represents a fair or mean rate of return for money"477. Stability can be achieved now, without the sacrifice of a fair rate, by adopting the rate, as was common ground, from the Federal Court Practice Note. To depart now from the practice of equity, Admiralty, or statute established for centuries would be a significant sacrifice of the stability of the law in circumstances where the underlying principle for the award of interest in all of these areas, over the entire course of their development, has been that the claimant is deprived of money for a single period. Although the "just terms" that are required for the award of compensation in s 51 import a power to award interest, that power cannot be extended to compound interest "on" an award of compensation. Conclusion I agree with the orders proposed in the joint judgment. In particular, I agree that the award of interest upon the "economic loss" of $320,250, as rounded, should be $910,100. interest employs an rt (rate multiplied by time) multiplier of 2.84182, which is the multiplier used by the Full Court. Although different rt multipliers were adopted by the parties in spreadsheets handed up during these appeals, there was no challenge in this Court to the rt multiplier used by the Full Court, which, as explained earlier in these reasons, varied the rt multiplier used by the primary judge consequent upon allowing the Commonwealth's appeal ground concerning lot 47. This award of 476 (1956) 96 CLR 397 at 421. 477 In re Tennant; Mortlock v Hawker (1942) 65 CLR 473 at 507-508; [1942] HCA 3, cited in Asiatic Steam Navigation Co Ltd v The Commonwealth (1956) 96 CLR 397
HIGH COURT OF AUSTRALIA AND APPELLANT RESPONDENT [2015] HCA 47 9 December 2015 ORDER Appeal allowed in part. Set aside orders 1-4 of the Full Court of the Supreme Court of South Australia made on 10 December 2014 and, in their place, order that: the appeal be allowed in part; the cross-appeal be dismissed; and paragraph 1 of the order made by Judge Tilmouth on 19 November 2012 be varied by replacing the sum of $1,387,888.87 with the sum of $1,223,287.74. Appellant to pay the respondent's costs of and incidental to the appeal to this Court. On appeal from the Supreme Court of South Australia Representation M C Livesey QC with B J Doyle for the appellant (instructed by Hunt & Hunt Solicitors) R J Whitington QC with J M Atkins and B J Krupka for the respondent (instructed by Meller Olsson Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Torts – Negligence – Contributory negligence – Section 47 of Civil Liability Act 1936 (SA) ("Act") presumes contributory negligence of injured person who relied on care and skill of intoxicated person and who was aware or ought to have been aware that other person was intoxicated – Section 47(2)(b) of Act establishes exception where injured person could not reasonably be expected to have avoided risk – Where respondent travelled in car with intoxicated driver and suffered serious injuries – Whether respondent could reasonably be expected to have avoided risk – Proper construction of s 47(2)(b) of Act – Relevance of respondent's capacity to make reasonable assessment of relative risks – Relevance of subjective characteristics. Torts – Negligence – Contributory negligence – Section 49 of Act presumes contributory negligence where person injured in motor vehicle accident not wearing seatbelt – Where respondent was not wearing seatbelt and suffered serious injuries in motor vehicle accident – Whether appellant's erratic driving prevented respondent from fastening seatbelt – Whether factual findings overturned on appeal – Relevance of "act of a stranger" defence. Words and phrases – "act of a stranger", "could not reasonably be expected to have avoided the risk", "reasonable assessment of risk". Civil Liability Act 1936 (SA), ss 3, 44(1), 47, 49. FRENCH CJ, KIEFEL, BELL, KEANE AND GORDON JJ. On 12 March 2007, the respondent, Danielle Chadwick, was thrown from the back seat of a car being driven by the appellant, Alex Allen. Ms Chadwick sustained serious spinal injuries which rendered her paraplegic. At the time of the accident, Mr Allen's blood alcohol level was around 0.229 per cent. It is not in dispute that his negligent driving caused Ms Chadwick's injuries. The issues for determination by this Court are whether Ms Chadwick was contributorily negligent, first, for choosing to travel in the car driven by Mr Allen when she ought to have known that he was intoxicated, and, secondly, for failing to engage her seatbelt. The resolution of each of these issues depends respectively upon the operation of ss 47(2)(b) and 49 of the Civil Liability Act 1936 (SA) ("the Act"). The trial of Ms Chadwick's action in the District Court of South Australia occupied 62 sitting days. It is a matter of some concern that the trial of an action for damages for personal injury arising out of a motor vehicle accident should have involved so much time and associated expense. After this litigious marathon, the trial judge (Tilmouth DCJ) declined to make the reduction of 50 per cent in Ms Chadwick's damages which Mr Allen's insurers had sought pursuant to s 47 of the Act. His Honour held that, in the circumstances in which Ms Chadwick found herself, she could not reasonably be expected to have avoided the risk of riding with Mr Allen. On that basis, s 47(2)(b) of the Act operated to except Ms Chadwick from the presumption of contributory negligence on her part which arose from riding with Mr Allen. The trial judge did, however, reduce Ms Chadwick's damages by 25 per cent pursuant to s 49 of the Act because she was not wearing a seatbelt at the time of the accident. On Mr Allen's appeal to the Full Court of the Supreme Court of South Australia, the Court by majority (Gray and Nicholson JJ, Kourakis CJ dissenting) upheld the trial judge's decision in relation to the s 47 issue; and, on Ms Chadwick's cross-appeal, unanimously reversed the trial judge's conclusion in relation to the s 49 issue. Mr Allen appeals to this Court pursuant to special leave granted on 19 June 2015 by French CJ and Keane J. Bell Gordon For the reasons which follow, Mr Allen's appeal should be allowed, but only to the extent of restoring the trial judge's decision on the s 49 issue1. The circumstances of the accident At the time of the accident in 2007, Ms Chadwick and Mr Allen were in a relationship that had been on and off again for several years. Ms Chadwick was 21 years old and Mr Allen was 28 years old. Ms Chadwick's daughter, Hope, was five years old. Ms Chadwick was pregnant at the time. She had known that she was pregnant for nine or 10 weeks. On 10 March 2007, Ms Chadwick, Mr Allen and Hope set off from their home in the Adelaide Hills for a weekend on the Yorke Peninsula. They slept overnight near Port Pirie, and the following morning met up with a friend of Mr Allen, Mr Martlew. Ms Chadwick, Mr Allen and Hope joined Mr Martlew and his two children, then aged three and six, and the whole group travelled onward in Mr Martlew's Holden Commodore station wagon. Mr Allen and Mr Martlew drank alcohol throughout the day, including mixers of rum or bourbon contained in pre-mixed cans which they retrieved from an esky in the boot of the car. The group attended a field day in Kadina; it is probable that this is where the men began drinking. They continued to drink steadily thereafter, including at the Wallaroo Hotel, where the group stopped for lunch. At some point in the day, probably when the group left Kadina, Ms Chadwick assumed responsibility for driving the car; her evidence was that she was not drinking on account of her pregnancy. The group arrived in Port Victoria in the early evening and booked two rooms in a motel attached to the Port Victoria Hotel. Once in Port Victoria, Ms Chadwick and the three children played in a playground. At one point, Mr Allen joined them and fell off a see-saw, something that he attributed to his state of intoxication. Ms Chadwick readied the children for bed while Mr Allen and Mr Martlew continued drinking at the Port Victoria Hotel. Once the children 1 For the sake of completeness it may be noted that an issue as to one minor aspect of the appeal concerning the quantum of the component of Ms Chadwick's damages for future care was resolved by agreement between the parties. Bell Gordon were asleep, Ms Chadwick left them at the motel and joined the men in the front bar of the hotel. The two men were seen by the bartender, Ms Kneebone, to be drinking mainly spirits, namely whiskey or rum. The trio left the bar after last drinks were called. Between 1.30 am and 2 am, a decision was made to go for a drive, "ostensibly" (as the trial judge put it) to find some cigarettes2. All three left, with Ms Chadwick driving Mr Martlew's car. The children remained at the motel. Ms Chadwick's evidence was that she drove for 10 to 15 minutes around Port Victoria, and at one point left the township itself. Mr Martlew was sitting in the front seat next to Ms Chadwick, and Mr Allen was in the rear passenger area. The drive, as described by Ms Chadwick, was chaotic, with very loud music playing and both men constantly shouting directions at her. At one point, Ms Chadwick stopped the car on the side of the road, got out and went behind some bushes to urinate because she was "busting like anything". It was later ascertained that the car was stopped on Wauraltee Road, on the outskirts of Port Victoria, approximately 500 metres from the Port Victoria Hotel. Ms Chadwick gave evidence that she thought she was "in the middle of nowhere" and that it was "just black. Literally black." She said that she could see a light, but that it was so far away that she did not know what it was. Mr Martlew gave evidence that it was "dark" and that he could not see any lights; however, he later added that there were lights to the left and right, and town lights "straight ahead". Undisputed evidence showed that there was street lighting in the distance, to the north and to the south east, about 200 metres away in each direction. The trial judge accepted Ms Chadwick's evidence that she was "somewhat disoriented and considered herself to be much further away from the town" than she in fact was3. When Ms Chadwick returned to the car, Mr Allen was in the driver's seat. Ms Chadwick remonstrated with him and told him not to drive. She gave evidence that he replied, "Get the fuck in the car" or words to that effect. Mr Martlew did not recall an argument between the pair, but gave evidence that they "said something to each other". 2 Chadwick v Allen [2012] SADC 105 at [12]. 3 Chadwick v Allen [2012] SADC 105 at [138]. Bell Gordon Ms Chadwick entered the car via the rear right-side door and sat on the rear right-hand passenger seat. She said that Mr Allen took off so fast that she did not have a chance to close the door, which closed with the force of his acceleration. Ms Chadwick failed to put on her seatbelt. Mr Allen was driving aggressively and erratically. He drove back into Port Victoria, performed a U-turn on the main street, spun the tires, and accelerated back out of town along Wauraltee Road. When Mr Allen attempted a sweeping left-hand bend, the car started to spin first in an anti-clockwise direction, then in a clockwise direction, and then again in an anti-clockwise direction. While spinning anti-clockwise for the second time, the right-hand side of the car struck a small tree, and then the rear right side heavily struck a mature tree. The force of the second impact towards the right rear door of the car catapulted Ms Chadwick out of the car and she hit the ground, sustaining acute spinal cord injuries. Relevant legislation Section 3 of the Act relevantly provides: "contributory negligence means a failure by a person who suffers harm to exercise reasonable care and skill for his or her own protection or for the protection of his or her own interests". Section 44(1) of the Act is significant. It precludes any suggestion that the reasonable care and skill expected of a plaintiff for the protection of his or her own interests is something different from the reasonable care and skill expected of a defendant for the protection of the interests of others. Section 44(1) provides that: "The principles that are applicable in determining whether a person has been negligent also apply in determining whether a person who suffered harm (the plaintiff) has been contributorily negligent." Section 47(1) creates an irrebuttable presumption of contributory negligence on the part of a person injured in the circumstances in which Ms Chadwick was injured. It provides: Bell Gordon the injured person – was of or above the age of 16 years at the time of the accident; and relied on the care and skill of a person who was intoxicated at the time of the accident; and (iii) was aware, or ought to have been aware, that the other person was intoxicated; and the accident was caused through the negligence of the other person; and the defendant alleges contributory negligence on the part of the injured person, contributory negligence will, subject to this section, be presumed." An exception to the operation of s 47(1) arises where the injured person establishes that he or she could not "reasonably be expected to have avoided the risk" of injury which arose as a result of relying on the care and skill of a person who was, and should have been known to be, intoxicated. Section 47(2) provides relevantly: "Subject to the following exception, the presumption is irrebutable. ... The injured person may rebut the presumption by establishing, on the balance of probabilities, that – the injured person could not reasonably be expected to have avoided the risk." In the present case, by reason of Mr Allen's blood alcohol concentration, sub-ss (3) and (5) of s 47 operated, unless the exception in s 47(2)(b) applied, to produce a fixed reduction in the assessment of Ms Chadwick's damages of 50 per cent. In this regard, sub-ss (3) and (5) provide relevantly: Bell Gordon In a case in which contributory negligence is to be presumed under this section, the court must apply a fixed statutory reduction of 25 per cent in the assessment of damages. If, in the case of a motor accident, the evidence establishes – that the concentration of alcohol in the driver's blood was .15 grams or more in 100 millilitres of blood ... the fixed statutory reduction prescribed by subsection (3) is increased to 50 per cent." Section 49 erects a presumption of contributory negligence on the part of a person injured in a motor vehicle accident where that person was not wearing a seatbelt at the time of the accident as required under the Road Traffic Act 1961 (SA) ("the RTA"). In such circumstances, s 49 provides for a compulsory reduction in damages of 25 per cent. Section 49 provides relevantly: If the injured person was injured in a motor accident, was of or above the age of 16 years at the time of the accident and – the injured person was not, at the time of the accident, wearing a seatbelt as required under the Road Traffic Act contributory negligence will, subject to this section, be presumed. In a case in which contributory negligence is to be presumed under this section, the court must apply a fixed statutory reduction of 25 per cent in the assessment of damages." In relation to s 49(1)(a), at the time of the accident in the present case, the RTA contained no provision specifically requiring the wearing of a seatbelt; but s 80 of the RTA made provision for the making of "rules (Australian Road Rules) [('the ARR')] to regulate … any aspect of … passenger … conduct", and the ARR, in force at the date of the accident, provided relevantly by r 265: Bell Gordon "(1) A passenger in … a motor vehicle that is moving … must comply with this rule if the passenger is 16 years old, or older. If the passenger occupies a seating position fitted with a seatbelt, the passenger must wear the seatbelt properly adjusted and fastened unless the passenger is exempt from wearing a seatbelt under rule Section 50 of the Act provides for the assessment of damages in light of the operation of ss 47 and 49 of the Act in a given case. The operation of s 50 in this case is not controversial, and no more need be said of it. The decision of the trial judge The trial judge held that Ms Chadwick ought to have been aware that Mr Allen was intoxicated when she decided to ride with him driving the car5. Accordingly, s 47(1)(a)(iii) of the Act gave rise to the presumption of contributory negligence on her part. Ms Chadwick contended that the exception in s 47(2)(b) of the Act applied in this case because, in the circumstances, she could not reasonably be expected to have avoided the risk of travelling with Mr Allen. The trial judge accepted the contention that the circumstances gave rise to the exception in s 47(2)(b), so that Ms Chadwick avoided the 50 per cent reduction in damages that would otherwise have applied pursuant to s 47(5) of the Act. Ms Chadwick also argued that her failure to wear a seatbelt did not constitute contributory negligence for the purposes of s 49 of the Act. In her pleading in reply she alleged that the seatbelt mechanism was inoperable. This allegation was not made out at trial, but Ms Chadwick gave evidence to the effect that the erratic driving of Mr Allen had made it impossible for her to engage the seatbelt mechanism. The trial judge rejected this evidence and held that Ms Chadwick was contributorily negligent for failing to wear a seatbelt. Accordingly, her damages were reduced by 25 per cent pursuant to s 49(3) of the Act. 4 Mr Allen submitted that none of the exemptions were relevant to the present case. 5 Chadwick v Allen [2012] SADC 105 at [86]. Bell Gordon The trial judge observed of Ms Chadwick that: "She was demonstrably an unsatisfactory witness in relation to a number of key issues."6 His Honour found that Ms Chadwick "lied profusely"7. Nevertheless, his Honour accepted as a fact that Ms Chadwick did not know where she was in relation to the town when she returned to the car to find that Mr Allen insisted upon driving8. As will be seen, that was an important finding of fact which was not disturbed on appeal. As to the application of s 47(2)(b) of the Act, the trial judge held that "a 21 year old pregnant woman … with two older men at 2 am in the morning in a strange place, stranded on the outskirts of a remote country town in a darkened area, without appreciating that she was much nearer than she thought, and when no-one was up or about." His Honour went on to conclude that Ms Chadwick "objectively speaking … had little choice but to enter the vehicle", given the "precarious situation" in which she found herself10. The trial judge departed somewhat from the approach required by the text of s 47(2)(b) of the Act in referring to "an impossible situation or predicament in which no reasonable person placed in the precise position of the injured person, can avoid, or has no choice but to accept", the risk of riding with an intoxicated person11. To the extent that his Honour's reference to "no choice" departed from the language of s 47(2)(b), which contemplates the possibility of a reasonable choice to accept the risk of relying on the care and skill of a person who was, and should have been known to be, intoxicated, it may be said that it imposes upon a plaintiff an unduly stringent qualification for the exception in s 47(2)(b). 6 Chadwick v Allen [2012] SADC 105 at [48]. 7 Chadwick v Allen [2012] SADC 105 at [63]. 8 Chadwick v Allen [2012] SADC 105 at [141]-[142]. 9 Chadwick v Allen [2012] SADC 105 at [141]. 10 Chadwick v Allen [2012] SADC 105 at [142]-[143]. 11 Chadwick v Allen [2012] SADC 105 at [94]. Bell Gordon As to the s 49 issue, the case which Ms Chadwick ultimately advanced was that the gravitational forces generated by Mr Allen's aggressive and erratic driving prevented her from fastening her seatbelt. The trial judge accepted that, as a matter of law, the failure of a passenger to fasten her seatbelt might be excused on the basis that she was prevented from doing so by the erratic driving of the vehicle. This ground of excuse was referred to as the "act of a stranger" defence, the description deriving from decisions of the Supreme Court of South Australia which recognised a defence to charges of offences of strict liability where a person charged is prevented from complying with a statutory requirement by the conduct of another12. But his Honour was not prepared to accept that Ms Chadwick had been so prevented. In this regard, there was expert evidence to the effect that Ms Chadwick had opportunities (albeit limited) to fasten her seatbelt during those periods when Mr Allen was driving the vehicle in a straight line. The trial judge accepted that evidence, and went on to hold that13: "it is impossible to conclude on balance that Ms Chadwick was prevented from fastening her seatbelt in the critical moments leading up to impact, either by the gravitational forces being too high for the better part of the period of time in question, that there was too little time to do so, or that it was defective in some unspecified way." Accordingly, the trial judge rejected Ms Chadwick's reliance on the "act of a stranger" defence14: "because the failure to place the seatbelt in the engaged position was not due to driving conditions or malfunction, rather it was due to impatience and impetuosity on Ms Chadwick's part, causing her to pull it too quickly and then to give up just as she described in her evidence." 12 cf Norcock v Bowey [1966] SASR 250 at 266, 268; Mayer v Marchant (1973) 5 SASR 567 at 573. 13 Chadwick v Allen [2012] SADC 105 at [167]. 14 Chadwick v Allen [2012] SADC 105 at [170]. Bell Gordon The decision of the Full Court The Full Court of the Supreme Court of South Australia dismissed Mr Allen's appeal with respect to the s 47 issue. Gray and Nicholson JJ held that the trial judge was correct to conclude that Ms Chadwick could not reasonably be expected to have avoided the risk of re-entering the vehicle with Mr Allen driving15. Their Honours noted that the approach taken by the trial judge was unduly stringent, holding that it is not necessary for an injured person to demonstrate that no reasonable person placed in the precise position of the injured person could have avoided the relevant risk, or would have had no choice but to accept the risk16. Their Honours held that, in determining whether s 47(2)(b) applies, a court must assess whether a reasonable person in the position of the injured person would have avoided the particular risk17. Their Honours took a broad approach to the question, in that they viewed s 47(2)(b) of the Act as posing18: "the question whether the conduct of a plaintiff, in choosing to expose themself to a risk of injury, which risk in fact eventuates, can be excused." In this regard, their Honours observed that Ms Chadwick's feelings of "helplessness and panic are readily understandable"19. To the extent that their Honours' reasons, which are not pellucid in this respect, suggest an approach which looks to whether the decision of the plaintiff is as reasonable as a helpless and panicking person could be expected to make, that approach does not conform to s 47(2)(b) considered in the light of s 44(1). Kourakis CJ dissented on this issue, taking the view that s 47(2)(b) imposes an 15 Allen v Chadwick (2014) 120 SASR 350 at 383 [119]. 16 Allen v Chadwick (2014) 120 SASR 350 at 383 [116]-[117]. 17 Allen v Chadwick (2014) 120 SASR 350 at 383 [116]. 18 Allen v Chadwick (2014) 120 SASR 350 at 381 [103]. 19 Allen v Chadwick (2014) 120 SASR 350 at 382 [113]. Bell Gordon objective standard in which an injured person's emotional or intellectual difficulties in making a reasonable decision are not taken into account20. Kourakis CJ traced the history of s 47 to the enactment of the antecedent provision, s 35a(1)(j) of the Wrongs Act 1936 (SA), in respect of which there was "no doubt but that [it] was intended to effect a more rigorous approach to the reduction of damages for contributory negligence"21. His Honour held that to take into account subjective difficulties impairing a plaintiff's decision-making capacity would "transform s 47 of the [Act] into the converse of what was intended by the enactment of its progenitors"22. In terms of the divergent approaches to the operation of s 47(2)(b), it will be seen that the approach of Kourakis CJ is to be preferred to that of the majority. Kourakis CJ went on to conclude on the facts that a reasonable person in Ms Chadwick's position would appreciate that "the risk in getting into the car driven by Mr Allen was great", "would take the time to survey her geographical location and would appreciate that she was about 200 m away from the outskirts of the township and about … 10 minutes walk from the Hotel", and would then "assess that there was no significant danger to her personal safety in walking the short distance into a quiet country town even at that hour."23 Kourakis CJ concluded that a reasonable person would have substantially discounted such risk as there might have been in that regard "because there was no reason for [her] to think that Mr Allen would be so callous as to abandon her completely even if he had initially driven off."24 A different view of the proper conclusion to be drawn from the application of the law to the facts of the case would follow from the acknowledgement that there was, in truth, little reason why Ms Chadwick should have expected common sense or common decency from Mr Allen. As to the s 49 issue, all three members of the Full Court were in agreement that the "act of a stranger" defence excused Ms Chadwick's failure to 20 Allen v Chadwick (2014) 120 SASR 350 at 359 [23]-[24]. 21 Allen v Chadwick (2014) 120 SASR 350 at 364 [39]. 22 Allen v Chadwick (2014) 120 SASR 350 at 366 [46]. 23 Allen v Chadwick (2014) 120 SASR 350 at 367 [50]. 24 Allen v Chadwick (2014) 120 SASR 350 at 367 [50]. Bell Gordon fasten her seatbelt. Kourakis CJ said25 that "Ms Chadwick's actions were a direct and natural response to Mr Allen's bad driving", and that26: "To the extent that [the trial judge's] reasons imply a finding that Ms Chadwick acted as she did only out of anger at Mr Allen for taking over the driving and not by reason of the urgency created by Mr Allen's driving, the evidence does not support that finding." It should be noted here that even if Ms Chadwick's actions in failing to fasten her seatbelt were a "direct and natural response" to Mr Allen's bad driving, that would not mean that he had actually prevented her from fastening her seatbelt; whether or not her response was motivated by anger was not decisive of the question. Gray and Nicholson JJ held that27: "It can be readily understood that, in these circumstances, a passenger would yank or pull at a seatbelt in an effort to free it, even more so an anxious and distressed 21 year old pregnant woman who was desperate to fasten her seatbelt. To conclude to the effect that, in these circumstances, a passenger should be sufficiently calm and collected to wait for an opportunity to fasten the seatbelt if it were to arise and to seize upon that opportunity immediately before it was lost again, is wholly unrealistic. We consider that the judge's conclusions in this respect cannot be sustained. We are satisfied that Ms Chadwick adduced evidence which would be capable of giving rise to an act of a stranger defence." The issue was not whether Ms Chadwick had "adduced evidence which would be capable of giving rise to an act of a stranger defence", but whether the evidence which she gave should have been accepted. The trial judge did not accept her evidence; and, as will be seen, the Full Court did not overturn factual findings which supported that rejection. 25 Allen v Chadwick (2014) 120 SASR 350 at 358 [19]-[20]. 26 Allen v Chadwick (2014) 120 SASR 350 at 358 [20]. 27 Allen v Chadwick (2014) 120 SASR 350 at 393-394 [156]-[158]. Bell Gordon The s 47 issue On behalf of Mr Allen, it was submitted that there was a fundamental difference between Kourakis CJ and the majority. It was said that the majority erred in fixing upon Ms Chadwick's personal characteristics and asking whether her position was "understandable" in the light of those characteristics, and whether her choice to expose herself to the risk of injury "can be excused"28 by reference to some other unidentified standard of behaviour. It was argued that the proper approach, once s 47(1) is engaged, is for the "idiosyncrasies of the particular person whose conduct is in question" to be disregarded in the evaluation required by s 47(2)(b)29. On behalf of Ms Chadwick, it was argued that the expression "the injured person" in s 47(2) permits the decision-making characteristics of the individual person to be taken into account. It was said that the majority committed no error of principle when their Honours concluded that Ms Chadwick's "feelings of helplessness and panic are readily understandable"30, nor when their Honours observed that Ms Chadwick was not to be judged by reference to the standard of a perfectly rational decision-maker31. It was said that the majority's allowance for reactions of confusion, helplessness and panic was a proper acknowledgement that the standard set by s 47(2)(b) allows for a range of human emotions apart from strict and dispassionate rationality. These submissions as to the operation of s 47(2)(b) should not be accepted. Section 47(2)(b) is concerned with the reasonable evaluation of the relative risks of riding with an intoxicated driver or taking an alternative course of action. As Kourakis CJ rightly held, it contemplates an objectively reasonable evaluation of the relative risks. Section 47(2)(b) contemplates the possibility that it may be reasonable for a plaintiff to decide not to avoid the risk of riding with an intoxicated person because it may reasonably be assessed as the less risky of two unattractive alternatives. It does not contemplate that a plaintiff be confronted with "no choice" but to ride with the intoxicated driver; nor does it 28 Allen v Chadwick (2014) 120 SASR 350 at 381 [103]. 29 Joslyn v Berryman (2003) 214 CLR 552 at 564 [32]; [2003] HCA 34 citing Glasgow Corporation v Muir [1943] AC 448 at 457. 30 Allen v Chadwick (2014) 120 SASR 350 at 382 [113]. 31 Allen v Chadwick (2014) 120 SASR 350 at 383 [113]. Bell Gordon contemplate the most reasonable evaluation of which a person whose capacity for reasonable evaluation is diminished is capable. The evaluation which s 47(2)(b) contemplates is an evaluation of relative risk in a given situation by the exercise of reasonable powers of observation and appreciation of one's environment, as well as the exercise of a reasonable choice between alternative courses of action. Inputs into the evaluation contemplated by s 47(2)(b) are those facts, as they may reasonably be perceived, which bear upon the reasonable assessment of the relative risks of alternative courses of action. Those facts may include matters of objective fact personal to the plaintiff as well as aspects of the external environment. But subjective characteristics of the plaintiff which might diminish his or her capacity to make a reasonable evaluation of relative risk in the light of those facts are immaterial to the evaluation which s 47(2)(b) contemplates. Those subjective characteristics might include impetuosity, drunkenness, hysteria, mental illness, personality disorders or, as Kourakis CJ said32, "witlessness". For example, if a person suffering from a medical condition, and subject to episodic disabling symptoms, were to be confronted with the choice of an arduous trek out of a wilderness as the only alternative to accepting a lift with a drunk driver, that person might reasonably choose to accept the lift rather than be left at the risk of the occurrence of the episode in the wilderness where he or she would have no recourse to assistance; whereas a risk-laden decision by the same person to accept a lift with a drunk driver in a busy urban area would not be "reasonable" simply because it was made while the person was, because of stress associated with a particular episode, prevented from making a reasonable evaluation of the relative risks. That is to say, the circumstance that a person is incapable of making a reasonable decision at the relevant time has no bearing on the reasonableness or otherwise of the decision actually made. Had the issue arisen under the common law unaffected by statute, a plaintiff's subjective mental or emotional state would have been irrelevant to the reasonable choice expected of him or her. In Joslyn v Berryman33, McHugh J, speaking of the position at common law, said: "a plaintiff cannot escape a finding of contributory negligence by pleading ignorance of facts that a reasonable person would have known or 32 Allen v Chadwick (2014) 120 SASR 350 at 366 [46]. 33 (2003) 214 CLR 552 at 567 [39]. Bell Gordon ascertained. A pedestrian or driver who enters a railway crossing in the face of an oncoming train cannot escape a finding of contributory negligence because he or she was not, but should have been, aware of the train. Nor does it make any difference that the pedestrian or driver had defective hearing or sight. Contributory negligence is independent of 'the idiosyncrasies of the particular person whose conduct is in question'34." Nothing in s 47(2)(b) (or the Act more generally) suggests a statutory purpose to alter the law in favour of making an allowance for a plaintiff's subjective difficulties of cognition and decision-making. It is important here to bear in mind that a defendant who inflicts harm on another by unreasonable conduct is not excused from liability in negligence because of a reduced personal capacity for reasonable decision-making35. Section 44 of the Act operates to apply the same rule to determining whether a plaintiff has been contributorily negligent. In either case, confusion or panic on the part of the actor does not reduce what reasonableness requires. To take into account a mental or emotional state which subjectively reduces the capacity for reasonable decision-making would be the objectively reasonable assessment of risk which s 47(2)(b) postulates. inconsistent with The terms of s 47(2)(b) reflect the legislative adoption of a policy that, of those who suffer injuries in accidents, including motor vehicle accidents, only those injured as a result of a risk which they "could not reasonably be expected to have avoided" should be entitled to recover full damages from a defendant whose liability is to be met by the compulsory insurance scheme. The legislative determination that the full benefits of a claim in negligence covered by the scheme should not be available to those who have not acted as would reasonably be expected reflects a balancing of policy considerations including those which bear upon the viability of the scheme36. Sections 44 and 47 of the Act give effect to that balance. 34 Glasgow Corporation v Muir [1943] AC 448 at 457. 35 Vaughan v Menlove (1837) 3 Bing (NC) 468 at 475 [132 ER 490 at 493]; McHale v Watson (1966) 115 CLR 199 at 213; [1966] HCA 13; Cook v Cook (1986) 162 CLR 376 at 391; [1986] HCA 73; Fleming's The Law of Torts, 10th ed (2011) at 36 King v Philcox (2015) 89 ALJR 582 at 595-596 [49]; 320 ALR 398 at 414; [2015] HCA 19. Bell Gordon The circumstance that Ms Chadwick felt helpless, anxious and confused has nothing to do with a reasonable evaluation of relative risk. Ms Chadwick could reasonably be expected to have walked back into the township in order to avoid the risk of riding with Mr Allen if walking back to town and the hotel could reasonably have been assessed as a less unsafe course of conduct. In this regard, Mr Allen submitted that Kourakis CJ was right to hold that a reasonable person would have appreciated that the risk of getting into a car driven by Mr Allen was great37; would have surveyed her location and appreciated her proximity to the township38; and would not have been disoriented39. While the first of these propositions may be accepted, the second and third must be rejected. Mr Allen submitted that a reasonable person in Ms Chadwick's position would not have been disoriented or confused, given her "objective proximity to residential areas" as found by the trial judge40. It was said that Ms Chadwick's evidence that the car travelled away from the township for upwards of 10 to 15 minutes should not be accepted, given the trial judge's adverse view of Ms Chadwick's credibility and the conflicting evidence in Mr Martlew's account. It was also said that there was street lighting visible in the distance from the location at which Ms Chadwick got into the car driven by Mr Allen; and that, in these circumstances, a reasonable person would have known and appreciated that she was not far from the township and hotel. These submissions do not proceed upon a sound factual foundation. Once it is accepted that, as the trial judge found, Ms Chadwick did not know where she was, then the availability of a relatively low-risk alternative to travelling back to the hotel in the vehicle with Mr Allen was not reasonably apparent. That finding was not disturbed by the Full Court, and no sufficient reason has been shown for this Court to set it aside41. 37 Allen v Chadwick (2014) 120 SASR 350 at 367 [50]. 38 Allen v Chadwick (2014) 120 SASR 350 at 367 [50]. 39 Allen v Chadwick (2014) 120 SASR 350 at 367 [51]-[52]. 40 Chadwick v Allen [2012] SADC 105 at [138]. 41 Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 at 434-435; [1988] HCA 7; Louth v Diprose (1992) 175 CLR 621 at 633-634; [1992] HCA 61; Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330 at 334-336 [6]-[11], 378-379 [164]-[166], 410-415 [286]-[293]; [2007] HCA 42. Bell Gordon The reasonable expectation with which s 47(2)(b) is concerned involves the exercise of reasonable powers of observation and appreciation of one's environment as well as the exercise of a reasonable judgment of the relative risk of alternative responses to the environment as observed and understood. That having been said, it was not unreasonable for Ms Chadwick to have had no clear appreciation of her proximity to the township from the location at which Mr Allen took over the driving of the vehicle. On the evidence accepted by the trial judge, she had driven out of the town under the direction of Mr Allen and Mr Martlew, and had followed a series of confusing directions for 10 to 15 minutes. There was no reason why she should have attended closely to the course she had taken while driving the vehicle under their directions. Reasonableness does not require constant vigilance as to the possibility of an emergency and a photographic memory of one's surroundings. that a It could reasonable person reasonably be expected Ms Chadwick's position would have taken a moment to apprise herself of her geographical situation to determine whether it was reasonably safe to walk back to town and the hotel. But a reasonable person in the position of Ms Chadwick would not, by "taking a moment", necessarily have appreciated that she was a relatively easy walk from the hotel. The trial judge found as a fact that Ms Chadwick did not know where she was, and did not appreciate how close she was to the township and the hotel; and it cannot be said that her imperfect understanding of her situation was unreasonable. A person with the limited factual information available to Ms Chadwick might reasonably have formed the same appreciation of the situation. A person does not make an unreasonable choice because he or she acts upon imperfect knowledge if perfect knowledge is not reasonably available. As to the view of Kourakis CJ that Ms Chadwick could not reasonably have assumed that she would be abandoned by Mr Allen if she did not get in the car as he had ordered, it must be said that there could be nothing unreasonable in the assumption that Mr Allen's reaction to a rebuff would not involve solicitude for Ms Chadwick's safe return to the hotel. Mr Allen's conduct towards her during the hours prior to the accident, and his peremptory demand that she get in the car, notwithstanding her reasonable objection to doing so, were hardly suggestive of a likelihood that he would behave towards her with reasonable concern for her safety. His insistence that he drive was itself manifestly inconsistent with such a possibility. An expectation that she would not be abandoned would have been an unreasonable expectation of the triumph of hope over experience. Bell Gordon In summary, the relevant inputs into the evaluation of relative risk required by s 47(2)(b) included the facts that Ms Chadwick was a young woman, who was pregnant (and therefore vulnerable to more serious consequences of an assault by a stranger than would otherwise have been the case) and on a dark and unfamiliar country road an uncertain distance from the township in the early hours of the morning. Those facts could reasonably lead to an evaluation of a real risk of harm, either from strangers or from the difficulties of a walk in unfamiliar territory over an indeterminate distance in the dark. In addition, the substantial risk of riding with Mr Allen could reasonably be regarded as lessened to a relatively acceptable level by reason of the absence of other vehicular traffic on the roads at the time. On a reasonable evaluation of these facts and the relative risks associated with them, Ms Chadwick could not have been expected to have avoided the risk of driving with Mr Allen. The s 49 issue It may be accepted that the wearing of a seatbelt was "required under the Road Traffic Act 1961"42. In arguing for the assessment of the 25 per cent reduction Ms Chadwick's damages, Mr Allen submitted that the "act of a stranger" defence to the failure to fasten a seatbelt is not available as a matter of law. The "act of a stranger" defence seems to have been developed in South Australia as a particular manifestation of a want of mens rea which has been regarded as inconsistent with a finding of criminal responsibility in cases where a defendant might otherwise have been held responsible for the commission of a forbidden act over which he or she had no control. It was explained by Bray CJ in Mayer v Marchant43, where his Honour said: "normally speaking it is a defence to a criminal charge ... to show that the forbidden act occurred as the result of an act of a stranger, or as the result of non-human activity, over which the defendant had no control and against which he could not reasonably have been expected to guard." Mr Allen also submitted that on the evidence, the defence of "act of a stranger" was not made out. Mr Allen argued that Gray and Nicholson JJ erred 42 Civil Liability Act 1936 (SA), s 49(1)(a). 43 (1973) 5 SASR 567 at 573. Bell Gordon in overturning44 the trial judge's finding on the basis that Ms Chadwick's "panic and distress" could be readily understood and that Mr Allen's erratic driving caused the seatbelt mechanism to lock. It may be accepted, for the sake of argument, that Mr Allen could not take advantage of Ms Chadwick's failure to comply with this requirement if he had, in fact, prevented her from doing so by his own conduct. It may also be accepted, for the sake of argument, that r 265(1) of the ARR must be understood as referring to a person whose non-compliance with the rule is voluntary. All that having been said, the trial judge found that Ms Chadwick was not prevented from fastening her seatbelt by Mr Allen's bad driving. The question is not whether Ms Chadwick's failure to fasten her seatbelt was an understandable, or even a reasonable, response to Mr Allen's driving. The question is whether she was prevented by Mr Allen from fastening her seatbelt; and that question is answered against her by the trial judge's findings of fact. Brief reference to Norcock v Bowey45 supports that conclusion. That case concerned a provision imposing a penalty on the owner of any cattle found straying in a street or public place. Napier CJ concluded that the "act of a stranger" defence was no answer to the charge. While it would have been a defence if the owner had shown that the cattle came upon the street or public place due to some circumstance beyond his control, including the wrongful act of a stranger, it was not enough to show that the owner had taken reasonable care to prevent his cattle straying46. The trial judge declined to find that Ms Chadwick was prevented from fastening her seatbelt by the manner in which Mr Allen drove the car. The trial judge found47 that Ms Chadwick had opportunities to fasten her seatbelt. While his Honour found48 that Ms Chadwick was unable to fasten her seatbelt because she pulled too hard on the straps in her anger at the behaviour of Mr Allen, that particular explanation for her failure to fasten her seatbelt (which was, arguably, not justified on the evidence) was unnecessary, given his Honour's fundamental 44 Allen v Chadwick (2014) 120 SASR 350 at 393-394 [156]-[158]. 45 [1966] SASR 250. 46 Norcock v Bowey [1966] SASR 250 at 266 per Napier CJ, 268 per Hogarth J. 47 Chadwick v Allen [2012] SADC 105 at [159]. 48 Chadwick v Allen [2012] SADC 105 at [162], [170]. Bell Gordon rejection of Ms Chadwick's account of the reason why she was not wearing a seatbelt at the time of the accident. Gray and Nicholson JJ did not accept the reliability of the expert evidence as to the "'reasonable opportunities' for Ms Chadwick to have engaged the seatbelt"49, and said that it was unrealistic to expect Ms Chadwick to have been sufficiently calm "to wait for an opportunity to fasten the seatbelt if it were to arise and to seize upon that opportunity immediately before it was lost again"50. But the Full Court did not explain how it was that the trial judge erred in concluding that the manner of Mr Allen's driving did not actually prevent her from fastening her seatbelt at some time from when she entered the car until the occurrence of the accident. The trial judge did not accept Ms Chadwick's account that the accident occurred "a matter of seconds" after she got into the back seat of the car51. The account was inconsistent with evidence of the route travelled by the car while it was being driven by Mr Allen52. That evidence established that there were at least two opportunities to engage the seatbelt as the car was driven on the straight sections of Main Street53. The trial judge's finding of fact reflected the advantage he derived from having seen and heard Ms Chadwick give evidence. There was nothing glaringly improbable, or contrary to compelling inferences, about his Honour's evaluation of the probabilities in the light of his advantage in seeing and hearing the witnesses give evidence54. Ms Chadwick bore the onus of proof on this issue, and in this regard her account failed to satisfy the trial judge. His Honour was sceptical of Ms Chadwick's evidence generally; and there were good reasons not to accept Ms Chadwick's account in relation to the seatbelt issue. It was inconsistent with her pleaded case; and the contention that she was entirely prevented at all times from fastening the seatbelt because of the physical forces generated by the manner of Mr Allen's driving was inconsistent with the expert 49 Allen v Chadwick (2014) 120 SASR 350 at 392 [154]. 50 Allen v Chadwick (2014) 120 SASR 350 at 393 [156]. 51 Chadwick v Allen [2012] SADC 105 at [168]. 52 Chadwick v Allen [2012] SADC 105 at [159]. 53 Chadwick v Allen [2012] SADC 105 at [159]. 54 Fox v Percy (2003) 214 CLR 118 at 126-127 [25], 133-134 [48]; [2003] HCA 22. Bell Gordon evidence that, even allowing for the forces generated by Mr Allen's driving, she would have had opportunities to fasten the seatbelt. Conclusion and orders The appeal should be allowed in relation to the s 49 issue; but otherwise dismissed. The Full Court assessed Ms Chadwick's damages at $2,210,379.48, which, after the deduction of agreed amounts, resulted in a final judgment sum of $1,803,903.36. The parties are agreed that, after further reducing the assessment of Ms Chadwick's damages by a further agreed amount to produce a figure of $1,776,542.36, then reducing that sum pursuant to s 49(3) of the Act, the sum for which judgment should have been ordered in Ms Chadwick's favour is Orders 1-4 of the Full Court should be set aside and, in their place, the appeal to the Full Court be allowed in part, and the cross-appeal to the Full Court be dismissed. Judgment should be entered for Ms Chadwick in the sum of It was a condition of the grant of special leave that Mr Allen would not seek to disturb the orders as to costs made in Ms Chadwick's favour in the court below and that Mr Allen would pay Ms Chadwick's costs in this Court in any event. Mr Allen must therefore pay Ms Chadwick's costs of and incidental to the appeal to this Court.
HIGH COURT OF AUSTRALIA EMP144 AND APPELLANT THE REPUBLIC OF NAURU RESPONDENT EMP144 v The Republic of Nauru [2018] HCA 21 16 May 2018 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Nauru Representation J W K Burnside QC with M L L Albert for the appellant (instructed by Allens) A Aleksov for the respondent (instructed by Republic of Nauru) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS EMP144 v The Republic of Nauru Migration – Refugees – Appeal as of right from Supreme Court of Nauru – Where Secretary of Department of Justice and Border Control of Nauru ("Secretary") determined appellant not refugee under Refugees Convention Act 2012 (Nr) – Where Secretary determined Nauru did not owe appellant complementary protection under Refugees Convention Act – Where Refugee Status Review Tribunal ("Tribunal") affirmed Secretary's determinations on basis appellant could reasonably relocate within country of origin – Where Supreme Court of Nauru affirmed Tribunal's decision – Whether appellant's ability reasonably to claim for complementary protection – Whether Tribunal failed to raise issue of whether appellant could reasonably relocate – Whether Tribunal failed to take into account factors relevant to appellant's ability reasonably to relocate – Whether Tribunal misunderstood country information. to relocate within country of origin relevant Words and phrases – "complementary protection", "country information", "internal relocation", "reasonable internal relocation", "refugee", "well-founded fear of persecution". Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment (1984), Art 3. International Covenant on Civil and Political Rights (1966), Arts 6, 7. Nauru (High Court Appeals) Act 1976 (Cth), s 5. Refugees Convention Act 2012 (Nr), ss 4, 22(b), 34(4), 40(1), 43. KIEFEL CJ, GAGELER AND NETTLE JJ. This is an appeal as of right, pursuant to s 5 of the Nauru (High Court Appeals) Act 1976 (Cth), from a judgment of the Supreme Court of Nauru (Khan J). The Supreme Court dismissed the appellant's appeal brought under s 43 of the Refugees Convention Act 2012 (Nr) ("the Refugees Act") against a decision of the Refugee Status Review Tribunal ("the Tribunal"). The Tribunal had affirmed a decision of the Secretary of the Department of Justice and Border Control, made pursuant to s 6 of the Refugees Act, to reject the appellant's application to be recognised as a refugee in accordance with the Act or as a person to whom the Republic of Nauru ("Nauru") owes complementary protection under the Act. The facts Before the Tribunal, the appellant presented as a 34 year old man from the village of Pakhu in the Myagdi district of Nepal. He said that Pakhu was isolated and not serviced by a road on which cars could be driven, and that his family owned a small farm there. He had attended boarding school in the town of Beni1, which was a day's walk from Pakhu, and about once a month he would walk back to his home in Pakhu. The appellant's father, uncle and older brother were all members of the pro-Royalist political group called the Rastriya Prajatantra Party of Nepal, otherwise known as the National Democratic Party of Nepal ("the RPP(N)"2). In 2003, however, the Myagdi district was taken over by members of the Nepal Communist Party-Maoist ("the NCP-M"). The following year the appellant's older brother disappeared and had not been seen since. The appellant's family believed the Maoists were responsible for his disappearance or, perhaps, death. Further, the appellant's father was attacked and assaulted for refusing to co-operate with the Maoists, and so departed for India where he had since remained. The appellant had visited him there. In 2006, the appellant married a woman from the next village, and in December 2006 they had a son. In 2008, a road was put through the area where the appellant and his family resided (although it did not reach Pakhu, which remained about an hour's walk from the road). A local person bought a jeep for use, in effect, as a taxi. The appellant learned to drive and became the taxi driver, although he never drove for more than about five hours from Beni. His wife and mother tended the crops on the family farm in Pakhu while the appellant worked as a taxi driver. 1 The Tribunal referred to Beni as "Benni" in their reasons. 2 The Tribunal sometimes referred to the RPP(N) as "the RRP(N)" in their reasons. Nettle In 2008, the appellant joined the RPP(N), at which time his Uncle Rudra was still active at the local level. In 2010, the appellant stopped working as the taxi driver in order to tend to his farm and devote himself more actively to politics by increasing his level of activity within the RPP(N). He worked in the RPP(N) office in Beni when he could, and he became the vice-president of the local branch. The appellant's case before the Tribunal The appellant's case before the Tribunal was that he was a refugee under the Refugees Act or, alternatively, that he was a person to whom Nauru owed complementary protection under the Act because his circumstances engaged Nauru's international obligations under, inter alia, the International Covenant on Civil and Political Rights (1966) ("the ICCPR") and the Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment (1984) ("the CAT"). The appellant's claim for protection was put on the basis that he had a well-founded fear of being persecuted in Nepal by reason of, inter alia, his political views. He stated that in Nepal there was a strong Maoist presence in the district which occasionally caused problems. For example, the appellant said that, on 7 August 2011, his Uncle Rudra was chairing an RPP(N) meeting, which the appellant did not attend, when a Maoist group came into the meeting hall, grabbed Uncle Rudra and forcibly paraded him around the Beni marketplace with his face blackened and shoes tied around his neck. Such gestures were said to show great disrespect and to cause Uncle Rudra to be humiliated. The appellant said that after the incident of public humiliation, his Uncle Rudra had not gone home to Pakhu but continued to live in Beni for some time until leaving the district. The appellant claimed that, shortly afterwards, on the evening of 10 August 2011, a group of about 15 of the local Maoists came to his farm, armed with sticks and calling out his name. He escaped through a back window and made his way in the dark to Beni, where he stayed with friends and in local hotels. He did not return to his farm in the daytime, but returned sometimes at night, cautiously. He spent his days in Beni, sometimes at the RPP(N) office, where he would on occasion see his Uncle Rudra. Uncle Rudra was aware of the appellant's situation, as were other party members. After about three months, when he had run out of money for hotels and was satisfied that there had been no further incursions on his farm, he returned to the farm but tried to avoid being outside during the daytime. The appellant further claimed that, in May 2012, he received a letter from the local Maoists threatening that there would be "consequences" if he did not Nettle leave the RPP(N) and support the Maoist ideology. He said that he was very frightened, particularly bearing in mind the disappearance of his older brother and the events that caused his father to flee to India. The appellant therefore caught a bus to the home of his parents-in-law in the neighbouring district of Baglung3, where he stayed for a month, and thereafter stayed with one of his uncles a further four hours' walk away. After a further month with no reports of further visits to his farm, the appellant returned to Beni and, as before, he gradually started returning to his farm at night, and then staying for two or three days at a time. Over time, the appellant resumed more or less permanent residence at the farm and, for a time, there were no reports of any more incursions or sightings of potential problems. But then in December 2012, when he was asleep at his farm, seven or eight Maoists came to the farm holding torches, pushed open the door, dragged the appellant outside and beat him with their fists and sticks into unconsciousness. When he regained consciousness, the Maoists had departed the farm and the appellant's neighbours had come to help. They took him to a clinic in Beni and undertook to tell his wife that he would go to Baglung and she should meet him there (apparently, on the basis that she would know that he would meet her at the home of his parents-in-law in Baglung). Meanwhile, he had discharged himself from the clinic and stayed at a friend's house for a couple of days and, while there, he heard that his home had been burned down. After that, he went to Baglung, where he was joined by his wife, son and mother. They told him that the Maoists had come back four nights later, dragged the family out of the house and then set fire to it. The appellant and his wife and son stayed with his parents-in-law for three months. But the appellant said that he remained uneasy as Baglung was only a couple of hours by vehicle from Beni and he thought the Maoists might still be looking for him. In the result, he left for Kathmandu, where he found his Uncle Rudra. And ultimately, it was from there that he departed Nepal lawfully on 25 May 2013 and eventually arrived in Nauru, without a passport, in November 2013. He claimed that he had never thought about returning to Nepal but that, if he did, he would still care about the RPP(N). The Tribunal's decision The Tribunal accepted that the appellant had suffered serious harm amounting to persecution at the hands of particular local Maoist groups (namely, the NCP-M and its youth group, the Youth Communist League ("the YCL")) 3 The Tribunal sometimes referred to Baglung as "Baglang" in their reasons. Nettle because of his political opinion, and that such harm might re-occur in the future if he were to return to the area where he had suffered the harm (namely, Pakhu and Beni). But the Tribunal concluded that, because it was localised harm which was the work of a particular branch of the NCP-M and the YCL situated in Beni, the appellant could reasonably be expected to establish himself elsewhere in Nepal and live a normal life without undue hardship. Consequently, he did not qualify as a refugee or for complementary protection. The Supreme Court's decision In dismissing the appellant's appeal to the Supreme Court, Khan J held that the Tribunal had not erred in applying a reasonable internal relocation test to the appellant's claim for complementary protection4; that the Tribunal had not failed to take into account all matters relevant to the appellant's claim for complementary protection, including whether it was reasonably practicable for him to relocate within Nepal5; and that the Tribunal had not failed to afford the appellant procedural fairness in their decision making process6. Grounds of appeal The appellant's grounds of appeal to this Court are as follows: The Supreme Court of Nauru erred by failing to conclude that the Refugee Status Review Tribunal ('the Tribunal') erred by failing to consider integers of the objection to relocation raised by the Appellant, namely that: his family and he would 'face substantial prejudice in accessing education, employment and essential services' and would be unsafe; he lived in hiding when he lived elsewhere to ensure he did not publically express his political views; and he does education' and no professional skills; and 'not have any tertiary or professional 4 See EMP144 v The Republic [2017] NRSC 73 at [61]-[62]. 5 See EMP144 v The Republic [2017] NRSC 73 at [46], [59]. 6 See EMP144 v The Republic [2017] NRSC 73 at [54], [75]. Nettle he holds ongoing fears for the safety of his wife and young son; and thereby erred by denying the Appellant natural justice in breach of s 22 and/or was in breach of s 34(4) of the Refugees Convention Act 2012 (Nauru) ('the Act'). The Supreme Court of Nauru erred by failing to conclude that the Tribunal acted in breach of s 22(b) and/or s 40(1) of the Act by failing to provide the Appellant with an opportunity to respond to the issue of whether it was reasonably practicable for him to relocate. The Supreme Court of Nauru erred by failing to conclude that the Tribunal erred by failing to consider integers of the Appellant's claims to complementary protection including that there was a reasonable possibility that he would be subject to arbitrary deprivation of life and/or torture and/or degrading treatment. The Supreme Court of Nauru erred by failing to conclude that the Tribunal erred by importing a relocation test in its analysis of the Appellant's 'complementary protection assessment' in breach of s 4(2) of the Act. The Supreme Court of Nauru erred by failing to conclude that the Tribunal erred by failing to: deal with evidence or other material provided by the Appellant in breach of s 34(4)(d) of the Act; alternatively, act in accordance with s 22(b) and/or s 40(1) of the Act in the conduct of the hearing about Nepali citizenship law relevant to the denial of the Appellant's son's Nepali citizenship application." (emphasis added) At the hearing of the appeal, the appellant sought leave to add the emphasised words to Ground 1. Leave was granted. Nettle Relevant statutory and treaty provisions The relevant statutory and treaty provisions are set out in CRI026 v The Republic of Nauru7 and need not be repeated. Ground 1: Failure to take into account objections to internal relocation Under Ground 1, the appellant contended that the Tribunal erred in law, and thereby denied the appellant natural justice in breach of s 22(b) of the Refugees Act, and failed to provide a statement of reasons in accordance with s 34(4) of the Act, by failing to respond to a "substantial, clearly articulated argument" that the appellant could not reasonably relocate within Nepal for "expressly articulated reasons" relying upon "established facts". The "expressly articulated reasons" were identified as follows: The appellant's family and he would "face substantial prejudice in accessing education, employment and essential services". The appellant lived away from his home area, in part because he wished to ensure that he did not publically express his political views, because "there is no freedom to express one's political views" throughout Nepal. The appellant did not have any tertiary or professional education or professional skills. He had only ever worked as a self-employed farmer and driver. The appellant held ongoing fears for the safety of his wife and young son. The "established facts" were said to be that the appellant had previously attempted to relocate within Nepal, which attempt had been unsuccessful and had caused him to flee Nepal. The appellant's first "expressly articulated reason" faces the difficulty that, although he contended before the Tribunal that the problems he was experiencing in having his child enrolled in school in Nepal were due to his political beliefs and adherence, ultimately the effect of the evidence before the Tribunal was that the problems associated with enrolling the appellant's child at school in Nepal [2018] HCA 19 at [12]-[15]. Nettle were due to the fact that neither the appellant nor his father were present in Nepal to vouch that the child was a Nepali citizen. As the Tribunal observed: "The [appellant] seemed to be of the view that it was his political opinion, or some action of the Maoists, that was denying his son citizenship. However, the Tribunal put it to him quite clearly that citizenship in Nepal can be established only with the active participation of the father. That is, the [appellant's] wife alone, even armed with her child's birth certificate, cannot prove that the boy has a Nepali citizen father. The case could be made out by the paternal grandfather, but like the [appellant] he too is outside Nepal (the [appellant's] father having lived in India for a decade). The Tribunal emphasised that country information on this point is irrefutable: a child needs evidence that his father is Nepali in order for him to have Nepali citizenship, and therefore to be able to attend school. It is nothing to do with the [appellant's] politics but rather, the position of women in Nepalese society. 'Securing citizenship papers for the child of Nepali parents, even when the mother possesses Nepali citizenship documents, was extremely difficult unless the father of the child supported the application. This persisted despite a 2011 Supreme Court decision to grant a child Nepali citizenship through the mother if the father was unknown or absent'." Nor can there be any doubt that that was the effect of the evidence. In a statement in support of his application to be recognised as a refugee, the appellant gave as one of his reasons for leaving Nepal that: "[a]s an active member of the [RPP(N)] my family and I face substantial prejudice in accessing education, employment and essential services. Furthermore, the facilities available to communities which are supporting the [RPP(N)] are poor compared to the pockets which are predominantly [NCP-M] members." Those alleged difficulties were said to show that he and his family were at risk of being discriminated against because of his political beliefs and associations and thus that his application for refugee status should be granted. But the evidence before the Tribunal told against that. After some discussion as to whether a Nepali woman is legally capable of passing on Nepali citizenship to her child, and having regard to country information which indicated that the position on the ground in Nepal was different to what it was at law, the appellant acknowledged that the problem with getting his child enrolled in school was that it was necessary for the appellant or his father to be present in Nepal to demonstrate their Nepali citizenship and that the appellant's wife was in truth his wife or his father's daughter-in-law. The appellant said that he was not prepared to go back Nettle to do that because he was scared that he would be persecuted, and that his father was not about to return from India. The evidence proceeded thus: "[THE APPELLANT (THROUGH INTERPRETER)]: There must be someone to witness [my wife and] also that she is my wife or my daughter-in-law. Sorry, yes, daughter-in-law or something like that, but there is no one to give this. There must be someone, relatives. [MEMBER 1]: Well, I don't think that's the real problem. I think that the discussion between you and your wife has – you know, the trying to talk over a long distance and so on. The problem is school enrolment and the child needs his father or his grandfather to show Nepali citizenship. [THE APPELLANT (THROUGH INTERPRETER)]: Yes, that's correct. [MEMBER 1]: Have you still got your passport? [THE APPELLANT (THROUGH INTERPRETER)]: No, it was thrown in the sea. [MEMBER 2]: Have you got a birth certificate? [MEMBER 1]: Because you could have sent that back to your wife. That ought to do. That would be proof. [THE APPELLANT (THROUGH INTERPRETER)]: The one who got my citizenship, he has thrown that in the sea. [MEMBER 1]: Okay. Well, that's the problem that your wife is facing, so you will have to – you know, either you can return or your father could travel back from India back to Nepal to help. [THE APPELLANT (THROUGH INTERPRETER)]: For me, I cannot go back because I'm scared that they will kill and about my father, I don't know. He's already in India, fled, and I don't know where is he." Given the evidence before the Tribunal and the findings which have been referred to, the contention that the Tribunal failed to consider the argument that Nettle the appellant and his family would "face substantial prejudice in accessing education, employment and essential services" must be rejected. It is also not correct to say that the Tribunal failed to consider the appellant's evidence that he had lived away from his home area, in part because he wished to ensure that he did not express his political views publically, because "there is no freedom to express one's political views" throughout Nepal. The appellant's evidence before the Tribunal was to the effect that, even when he had lived away from his home in Nepal, he had considered that he had to remain in hiding because he was not free to express his political views anywhere in Nepal. Likewise, in her closing address to the Tribunal, the appellant's legal representative stated: "We rely on our written submission and regarding the information we have provided to you that the Maoist group throughout the country act with impunity and there's no geographic limits for their actions. So with that recent changes [sic], there's no effect on the fact that [the appellant's] life still is in danger and Maoist party are still the opposition group. They're still powerful. They might not have the strongest seats in the parliament, but they have seats in the parliament. They are acting with impunity still throughout Nepal. Regarding [the appellant's] temporary residence in a couple of – in other cities, we submit that [the appellant] said himself today he was in hiding, he did not have a job, he wouldn't go out publicly. So that should not be assessed as a normal living condition." In effect, therefore, the thrust of the appellant's evidence and submissions before the Tribunal was that the appellant lived in fear of persecution at the hands of the Maoists and that relocation within Nepal would not be a practicable option for overcoming that problem because the Maoists were powerful throughout Nepal with the consequence that there was a real risk that the appellant could be harmed by the Maoists anywhere he went in Nepal. And the Tribunal acknowledged that was so: "The Tribunal accepts that two serious incidents befell the [appellant] within days of each other: that the [appellant] was assaulted in his house, resulting in his hospitalisation, and that within two or three days, his house was burned down (although his family had first been removed by the attackers) ... In short, the Tribunal accepts that the [appellant] has suffered serious harm – harm amounting to persecution – in the past at the hands of Nettle particular local Maoist groups (the NCP-M and its youth group, the YCL) for reason of his political opinion and that this harm may re-occur in the future if he were to return to that area. However, the Tribunal is satisfied that this is localised harm. It is the work of a particular branch of the NCP-M and its YCL: the branch which is situated in Benni and which includes members from the [appellant's] home village of Pakhu in the district of Myagdi." (emphasis in original) But having so acknowledged the thrust of the appellant's case, the Tribunal then turned to consider whether, despite the appellant's expressed fears that he would be at risk anywhere in Nepal, the threat of harm was localised: "The Tribunal notes that no harm has befallen the [appellant] when he has been staying in the neighbouring district of Baglung, nor in the capital Kathmandu. Therefore the Tribunal will consider the question of relocation." Having so identified that possibility, the Tribunal went on to analyse country information which they found established that there had been a remarkable transformation in the political landscape in Nepal, and a dramatic improvement in security, since the general election of 2013. On that basis, the Tribunal concluded that, since, in the altered political landscape, any threat of harm would be localised to a particular area, there would be no real chance of harm befalling the appellant if he were to move away from that area: "The major political parties of Nepal are working on issues relating to a new constitution. There has been a marked decline in the political volatility of the pre-election period, with the South Asia Terrorism Portal reporting only three violent political incidents at the beginning of 2014, followed by a whole year of non-violent political activity. The country, collectively, seems to be seeking an ongoing peaceful political landscape. There is nothing before the Tribunal which indicates that the [appellant] will be in any danger of persecution for reason of his support of the RRP(N), or the support of his uncle, father and (possibly) late brother for the RPP or RPP(N). The Tribunal acknowledges that a small group of Maoist cadres and political activists in a very specific location in Nepal have a history of antagonism against the [appellant] (for reason of his political opinion) and may seek to harm him in the future. The Tribunal accepts the [appellant's] testimony that there is no police presence in Pakhu and therefore any effective State protection for the [appellant] at home is absent. The Tribunal is satisfied that this threat of harm is localised and that the [sic] there is no real chance of harm amounting to persecution befalling the Nettle [appellant] if he moved away from his home district, whether he engages further in political activities or not." Contrary to the appellant's submissions, therefore, the Tribunal's reasons leave no doubt as to why the Tribunal were not persuaded that the appellant's evidence of remaining in hiding while he lived away from his home area rendered the option of internal relocation unreasonable. Axiomatically, whatever significance the appellant's evidence of remaining in hiding may have had in the period before the general election of 2013, on the Tribunal's findings the appellant's perception of the need to remain in hiding while living outside his home district ceased to be of significance in the post-election period as a result of the curtailment of the influence of the Maoists and the confinement of their reach to the localised areas of Pakhu and Beni. The Tribunal also dealt comprehensively with the appellant's contention that it would be unreasonable to expect him to relocate within Nepal because he did not have any tertiary or professional education and had only ever worked as a self-employed farmer and driver: "... The Tribunal notes that the [appellant] has said that his only employment history is as a farmer and a driver, and that he does not believe he would find work in India. However, the same argument can be made out in reference to his relocation to Nauru – and the latter location does not have a 10-12 million-strong community of Nepalese expatriates [who the Tribunal had earlier found were making a successful life in India under the rights accorded to them by the Treaty of Peace and Friendship]. However, the Tribunal is not directing the [appellant] to India. It simply finds that, in Nepal, only the immediate area around Benni in the Myagdi district is dangerous for the [appellant] or his family. No harm befell the [appellant] in his parents-in-law's house in the neighbouring district of Baglang, nor in Kathmandu. There are no claims, nor does the evidence suggest, that any harm has befallen his mother who now lives at her brother's house away from Pakhu and Benni. The Tribunal is satisfied that the [appellant] could reasonably be expected to establish himself elsewhere in Nepal and live a normal life without undue hardship. It notes that he lived for about three months in both neighbouring Baglang district (with his parents-in-law) and in Kathmandu before leaving Nepal. It notes that he is reasonably young (34 years) and able-bodied. He has completed year 10 of high school (leaving at Nettle 18 years) and is literate. He speaks the major language of Nepal and observes the religion of the large majority of his countrymen. The Tribunal notes that the [appellant] has shown resourcefulness in the past. When the road came to his district, he quickly learned to drive and was soon accomplished enough to be employed as a driver, taking passengers on journeys to destinations up to five hours away. He must have shown some political and/or leadership skills in order to be made the vice-president of his local RRP(N) branch, and may also have acquired other organising/administrative skills through his frequent work in the RRP(N) office in Benni from 2010. In short, the Tribunal notes that in Nepal, 'The law provides for freedom of internal movement, foreign travel, emigration and repatriation' and is satisfied that the [appellant] can freely move to, and settle in, any place outside the Pakhu/Benni area of Myagdi District." (footnote omitted) Finally on this aspect of the matter, the Tribunal dealt directly with the appellant's contention that he held ongoing fears for the safety of his wife and child. The Tribunal expressly found that the Maoists were targeting only the appellant: "The most recent incident (November 2014) when the YCL questioned the [appellant's] wife on her return to Benni also indicates that they were looking for the [appellant] – those were the questions they asked her. The [appellant] asserts that they hit his wife, and this could well be so, but it may indicate frustration with her answer that her husband was far away, rather than a deliberate attack on her. Fortunately, she was not seriously harmed and able to return to complete her mission at the government office." Ground 1 should be rejected. Ground 2: Failure to provide opportunity to respond to determinative issue of reasonableness of relocation Under the heading of Ground 2, counsel for the appellant contended that the Tribunal erred in a manner that denied the appellant natural justice, contrary to s 22(b) of the Refugees Act, and constituted a breach of the Tribunal's obligation to invite the appellant to appear before them, as provided for in s 40(1) of the Act, by failing to draw the appellant's attention to the importance of the issue of whether it would be reasonable for the appellant to relocate within Nepal. Nettle Those contentions are untenable. It is clear that the appellant and his legal representative were aware from the outset of the significance of the issue, and that they were specifically reminded of it in the course of the hearing before the Tribunal. In his statement to the Tribunal, the appellant expressly adverted to the possibility of internal relocation and sought to demonstrate that it was not a reasonable option for him because he would be at risk from the Maoists throughout Nepal: "Relocation The Secretary also suggested that I would be able to safely relocate to Kathmandu. I completely disagree with this statement. In Kathmandu, I am still at risk of harm. The whole time that I was in Kathmandu in 2013, I was in hiding. I hid in a hotel. I cannot hide in Kathmandu forever – how can I work or have a life? I have no idea where my [U]ncle Rudra is at the moment, because we have lost contact since he went into hiding. Last I heard he was in Kathmandu. If he is in Kathmandu at the moment, then he is in hiding, as he would have to be to avoid harm. My wife is currently in hiding in Nepal, but this will not be a sustainable solution to her problems for very much longer. I know she is still in danger, but I do not know how to help her all the way from Nauru. I am very worried about her, and the safety of our child. He is currently unable to attend school because of the dangers they are facing. I am at risk of harm throughout Nepal. As a member and supporter of the [RPP(N)], I will be persecuted by the Maoists throughout Nepal, including Kathmandu." Then, in the course of the appellant's oral evidence before the Tribunal, the Tribunal specifically alerted the appellant's legal representative to the fact that it appeared to the Tribunal that the risk of harm was localised, and thus that the appellant would not be at risk of harm in Nepal if he were to move away from the Maoists' area of influence. Having done so, they gave the appellant and his legal representative a "natural justice break" to enable the appellant's legal representative to consult with the appellant as to how the appellant wished to respond to that possibility: Nettle "[MEMBER 1]: Okay. I think we're just about getting up to a natural justice [break]. Can you see our points that we're looking at? We're looking at a very localised harm. [THE APPELLANT'S LEGAL REPRESENTATIVE]: location? Is that on [MEMBER 1]: So the harm is very localised that he has suffered – that he recognises the Maoists, they recognise him. It's a tiny place. And so, it seems reasonable to be anywhere else other than in that particular village, especially given the changes of circumstances. [MEMBER 2]: ..... be relocation? Wouldn't [it] be a relocation issue because he has said he's not going back to the village. [PRESIDING MEMBER]: ..... [MEMBER 2]: That's different. Yes. It may not be a question of relocation. [PRESIDING MEMBER]: No. Well, when - - - [MEMBER 1]: That may be a semantic problem because it's – if he - - - [MEMBER 2]: It's a – yes. ..... the test might not be - - - [MEMBER 1]: - - - [The appellant] says I am not going back to that particular village because my house has been burned down and chooses another location, then we're just racking our brains to see if that is the same test as relocation. But you may as well look at it under that ....., but it does seems [sic] to be a localised fight with the participants knowing each other and so on. And, but we also look to the fact that even those localised fighters may very well have stopped. There's no evidence of them continuing in – over the last year. [THE APPELLANT'S LEGAL REPRESENTATIVE]: So if he can replace or ..... if there is a still ongoing persecution, is it just the case that you will advance the .....? [MEMBER 1]: Yes, is there ongoing – yes, that's - - - [THE APPELLANT'S LEGAL REPRESENTATIVE]: Thank you. [MEMBER 1]: All right. Well, you can go to him and we will - - - Nettle [PRESIDING MEMBER]: So, the hearing is adjourned at 4.54 pm." Thereafter, when the hearing resumed at 5.01 pm, one of the Tribunal members, Member 1, asked the appellant whether he had thought about any of the issues that had been raised and whether he had something to say about them. The appellant replied that he had and then gave evidence to the effect that the Maoists retained power and influence throughout Nepal and thus that he remained in fear for himself and his wife and child, and as to the difficulties involved in enrolling his child in school in Nepal. Then at the end of the hearing, in her closing address to the Tribunal, the appellant's legal representative dealt directly with the point on the basis of the evidence which the appellant had given: "We rely on our written submission and regarding the information we have provided to you that the Maoist group throughout the country act with impunity and there's no geographic limits for their actions. So with that recent changes [sic], there's no effect on the fact that [the appellant's] life still is in danger and Maoist party are still the opposition group. They're still powerful. They might not have the strongest seats in the parliament, but they have seats in the parliament. They are acting with impunity still throughout Nepal. Regarding [the appellant's] temporary residence in a couple of – in other cities, we submit that [the appellant] said himself today he was in hiding, he did not have a job, he wouldn't go out publicly. So that should not be assessed as a normal living condition. The recent assault and threats shows that the threats and the persecution is ongoing. [The appellant] was desperate for the fact that he has no ..... appearance and as a result of that, his child might not be able to go to a school. And education was so important to him to the point that he would travel two days on foot to go to school and now, the fact that the child can't go to a school because of his absence is devastating for [the appellant]. In light of our secondary supplementary statement, filed note of statement, our submission and what [the appellant] said today and my submission, we submit that this tribunal should accept that [the appellant] has a well- founded fear of persecution throughout Nepal and cannot access the State protection." Ground 2 should be rejected. Nettle Ground 3: Failure to deal with integers of claim for complementary protection In support of Ground 3, the appellant contended that the Tribunal erred in failing to deal with the following "integers" of the appellant's claim for complementary protection: The appellant was at real risk of being subjected to arbitrary deprivation of his life, contrary to Art 6 of the ICCPR, by those who were his political opponents, as occurred to 25 of his political colleagues in his area and as was probably experienced by his brother, who had disappeared. The appellant was at real risk of being subjected to torture, contrary to Art 7 of the ICCPR and Art 3 of the CAT, on the basis that his father was tortured because he held the same political opinions as the appellant. The appellant was at real risk of being subjected to degrading treatment, contrary to Art 7 of the ICCPR, in the form of being painted black and paraded publically with shoes hanging around his neck because his Uncle Rudra had held the same political opinions as the appellant when he had been subjected to such humiliation. It was contended that the Tribunal's failure to consider those "integers" of the appellant's claim was evident in their conclusion that: "[t]here are no arguments advanced as to why the [appellant] would suffer these various types of harm, other than to state that removal to Nepal constitutes circumstances where the [appellant] has 'a well-founded fear'." That contention misstates the Tribunal's conclusion. As is apparent from the Tribunal's reasons, the Tribunal did take into account all of the "integers" of the appellant's claim and largely accepted his evidence as to the facts from which the integers were said to derive: "The Tribunal accepts that the [appellant] was an active member of the RRP(N), not only from his own testimony but also from photographs he showed of himself carrying RRP(N) banners at local demonstrations in Benni. The Tribunal also accepts that the [appellant's] Uncle Rudra was also an active member of the RRP(N), noting photographs of the incident in which Uncle Rudra was paraded around the Benni marketplace in a humiliating way by political opponents. The Tribunal notes reliable country information about the Maoist insurgency which began in 1995 and was only brought to an end by the Comprehensive Peace Agreement (CPA) signed in November 2006. Against this background, the Tribunal Nettle accepts that the [appellant's] elder brother disappeared in 2004, followed by his father's departure to India where he has remained since – both incidents attributable to adverse conditions brought about by Maoist guerrillas, but to be assessed differently from instances of recent harm. The Tribunal accepts the [appellant's] testimony that he became an office- bearer in the Benni branch of the RPP(N) in 2010. The Tribunal notes from the RPP(N)'s own website that it has a special category for 'active members', expecting them to give 30 hours service to the party per month. This supports the [appellant's] testimony that he 'worked' for the party at its Benni office and that he participated in party activities such as recruitment and public meetings. The Tribunal notes that the RRP(N) was a legal political party and had four elected members of parliament following the 2008 elections, although these appear to have lost their places in the most recent (November 2013) elections. This is consistent with the independent advice that the RRP(N) has only 'meagre popular support'. The RRP(N) maintains a website and there is no information that any of its leaders or members are targeted by other political groups, nor by the authorities. There is no evidence before the Tribunal, including the country information submitted by the [appellant], which indicates that the RPP(N) members are currently targeted by Maoists or indeed any other group in Nepal, or that the [appellant] would be persecuted if he were to return to Nepal and resume an active membership in the party. The Tribunal accepts that the [appellant] is known locally – that is, in his village and in Benni – as an office-bearer and active member of the RRP(N), just like his Uncle Rudra. The Tribunal accepts that Uncle Rudra was publicly humiliated by the Maoists in 2011 and from then on, did not return to his village but stayed in Benni, apparently doing less work for the RRP(N) before finally leaving the district at some unspecified time and going to Kathmandu. The Tribunal accepts that the [appellant] received a letter from the NCP-M demanding that he change his political support to their cause. However, the Tribunal notes that there are pro forma letters sent out by the Maoists, generally for purposes of extortion, and that in any case, no consequences ensued from the letter which was delivered in May 2012. The next adverse encounter was in December 2012 and it is difficult to see that one was a direct consequence of the other. The Tribunal is satisfied that these are two isolated incidents, although perpetrated by the same individuals. Nettle incident (November 2014) when The Tribunal accepts that two serious incidents befell the [appellant] within days of each other: that the [appellant] was assaulted in his house, resulting in his hospitalisation, and that within two or three days, his house was burned down (although his family had first been removed by the attackers). The fact that the family was removed from harm's way indicates that the attackers were targeting only the [appellant]. The most recent the YCL questioned the [appellant's] wife on her return to Benni also indicates that they were looking for the [appellant] – those were the questions they asked her. The [appellant] asserts that they hit his wife, and this could well be so, but it may indicate frustration with her answer that her husband was far away, rather than a deliberate attack on her. Fortunately, she was not seriously harmed and able to return to complete her mission at the government office." (footnotes omitted) It did not follow from the Tribunal's acceptance of the appellant's evidence of events that had occurred in Nepal that the Tribunal were bound to come to the same conclusion as the appellant as to the risk the appellant would face if he returned to Nepal. Due to the absence of evidence of continued attacks on persons of the appellant's political persuasion, and country information as to political changes that had occurred in Nepal since the events to which the appellant deposed (with consequent confinement of Maoist influence to a particular relatively isolated area in Nepal), the Tribunal were entitled to come to the different conclusion they did: that, although the appellant had suffered serious harm amounting to persecution at the hands of particular local Maoist groups (namely, the NCP-M and the YCL) "for reason of his political opinion", and although such harm might re-occur if the appellant were to return to that area, it was localised harm inflicted by Maoist groups in Beni which included members from the appellant's home village of Pakhu in the district of Myagdi, and the appellant could avoid the risk of that harm by reasonably and safely relocating elsewhere in Nepal. On that basis, the Tribunal were not in error in deciding that the appellant was not a refugee. The Tribunal turned finally to the assessment of the appellant's claim for complementary protection, which had been put on the same basis as his claim for refugee protection under the Refugee Convention: a well-founded fear of persecution for a Convention reason. The Tribunal rejected the complementary protection claim, accordingly, for the same reasons as they had rejected the claim for Convention protection: the appellant's ability to reasonably and safely relocate elsewhere in Nepal: "Having found that the [appellant] is not a refugee, the Tribunal now turns to consider whether he is owed complementary protection. In addressing this question, his representative asserted that if the [appellant] were Nettle returned to Nepal, he would face 'physical violence, discrimination and deprivation of economic and social rights'. There are no arguments advanced as to why the [appellant] would suffer these various types of harm, other than to state that removal to Nepal constitutes circumstances where the [appellant] has 'a well-founded fear'. However, the Tribunal has already found this not to be the case." There is no error in that. Ground 3 should be rejected. Ground 4: Relevance of ability reasonably to relocate to entitlement to complementary protection The arguments advanced by the appellant in support of Ground 4 were substantially the same as those advanced in CRI026 v The Republic of Nauru8. For the reasons given in that matter, they are rejected. Ground 5: Misunderstanding of country information about Nepali citizenship Finally, in support of Ground 5 the appellant contended that the Tribunal erred in their perception of country information as to a change in Nepali citizenship law that occurred in 2006 which allowed a Nepali woman to pass on her Nepali citizenship to her child, and thereby wrongly concluded that the difficulties faced in getting the appellant's child enrolled in school in Nepal were attributable to the inability of Nepali women to pass on Nepali citizenship to their children. As will be apparent from what has been said in relation to Ground 1, that contention is incorrect. It is plain that the Tribunal did not misunderstand that the appellant's wife was, at law, able to pass on her Nepali citizenship to the appellant's child as the mother of that child and thus qualify the child for enrolment in school in Nepal without invoking the assistance of the appellant as the father of the child. But as the country information to which the Tribunal referred also made clear, it remained the position, in fact, that: "a child needs evidence that his father is Nepali in order for him to have Nepali citizenship, and therefore to be able to attend school. It is nothing to do with the [appellant's] politics but rather, the position of women in Nepalese society. 'Securing citizenship papers for the child of Nepali parents, even when the mother possesses Nepali citizenship documents, was extremely difficult unless the father of the child supported the application. This persisted despite a 2011 Supreme Court decision to [2018] HCA 19 at [16]-[49]. Nettle grant a child Nepali citizenship through the mother if the father was unknown or absent'." Furthermore, as has been seen, the appellant confirmed in the course of the hearing before the Tribunal that, based on his telephone calls to his wife in Nepal, his understanding was that, in practice, the child could not be enrolled in Nepal unless either the appellant were present in Nepal to prove his citizenship and that the appellant's wife was in truth his wife, or the appellant's father were present in Nepal to prove his citizenship and that the appellant's wife was in truth his daughter-in-law. And since the father was absent and the appellant maintained that he was not prepared to return for Convention reasons, the child could not be enrolled. That had nothing to do with the appellant's political persuasion. Ground 5 should be rejected. Conclusion For the reasons which have been given, the appeal should be dismissed with costs.
HIGH COURT OF AUSTRALIA MINISTER FOR IMMIGRATION AND CITIZENSHIP APPELLANT AND AMIT KUMAR & ANOR RESPONDENTS Minister for Immigration and Citizenship v Kumar [2009] HCA 10 11 March 2009 ORDER Appeal allowed. Set aside orders 1 and 2 of the Full Court of the Federal Court of Australia entered on 23 May 2008 and order that the appeal to that Court be dismissed. The appellant pay the first respondent's costs of the appeal to this Court. On appeal from the Federal Court of Australia Representation S J Gageler SC, Solicitor-General of the Commonwealth with L A Clegg for the appellant (instructed by Australian Government Solicitor) M L Brabazon SC with J G Azzi for the first respondent (instructed by Rasan T Selliah & Associates) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Immigration and Citizenship v Kumar Administrative law – Procedural fairness – Migration Review Tribunal ("Tribunal") – Application for spousal visas – Migration Act 1958 (Cth) ss 5, 357A, 359A – Definition of "non-disclosable information" – "Non-disclosable information" whose disclosure would found an action for breach of confidence – Relevance of "iniquity defence" – Whether Tribunal obliged to disclose to applicant information given to Tribunal in confidence by informant – Whether obligation to disclose extends to identity of informant. Equity – Breach of confidence – Interaction of public and private law. Words and phrases – "Non-disclosable information". Migration Act 1958 (Cth), ss 5, 357A, 359A. FRENCH CJ, GUMMOW, HAYNE, KIEFEL AND BELL JJ. The Full Court of the Federal Court (Tamberlin, Finn and Besanko JJ)1 allowed an appeal by the first respondent (Mr Kumar) against the dismissal by the Federal Magistrates Court (Lloyd-Jones FM)2 of his application for certiorari to quash a decision of the second respondent ("the Tribunal") and for mandamus requiring the Tribunal to hear and determine according to law an application by Mr Kumar. That application was for review by the Tribunal of the decision of a delegate of the appellant ("the Minister") that Mr Kumar is not entitled to the grant of a Partner (Temporary) (Class UK) visa, nor to the grant of a Partner (Residence) (Class BS) visa, as provided by the Migration Regulations 1994 ("the Regulations")3 made under the Migration Act 1958 (Cth) ("the Act")4. The Full Court made orders for certiorari and mandamus directed to the Tribunal and in this Court the Minister seeks the setting aside of those orders. The Tribunal entered a submitting appearance. This Court made orders on 30 September and 12 December 2008 limiting, until further order, the publication of certain portions of the reasons for judgment of the Full Court, of Mr Kumar's summary of argument and of the evidence. The appeal was heard in open court without the need to refer in the argument to that material and these reasons are prepared on the same footing. Mr Kumar was born in Fiji on 14 September 1982. On 8 May 2004 at Lidcombe in New South Wales and pursuant to the provisions of the Marriage Act 1961 (Cth), Mr Kumar married Ms Rachel Sunita Krishna, an Australian citizen born in Australia on 26 September 1983. The Tribunal upheld the decision of the delegate, made on 29 September 2004, that the delegate was not satisfied that the parties were in a genuine and continuing marriage relationship and was not satisfied that the parties had a mutual commitment to a shared life as husband and wife. [2008] FCAFC 67. [2007] FMCA 995. 3 The appropriate reprint of the Regulations is Reprint 4, dated 1 March 2004. 4 The appropriate reprint of the Act is Reprint 10, dated 1 July 2006. Bell Mr Kumar had applied for permanent residence on "spouse grounds" on 10 June 2004, shortly after the marriage ceremony. The delegate noted that a permanent visa normally cannot be granted until two years have lapsed since the application was made, the process being "intended to test whether the relationship is continuing, 2 years after the visa application". However, a Partner (Temporary) (Class UK) visa might be granted immediately to permit presence in Australia until a decision be made on the permanent visa application. The two visa applications must be made at the same time (Regulations, Sched 1, item 1214C(3)(a)). The applicant for this temporary visa must seek to remain in Australia as "the spouse" of the person the applicant had intended to marry after entry into Australia (Regulations, Sched 1, item 1214C(3)(d)). For the purposes of the Regulations, Mr Kumar is the spouse of Ms Krishna if they are in a "married relationship" within the meaning of "Persons are in a married relationship if: they are married to each other under a marriage that is recognised as valid for the purposes of the Act; and the Minister is satisfied that: they have a mutual commitment to a shared life as husband and wife to the exclusion of all others; and the relationship between them is genuine and continuing; and (iii) they: live together; or do not live separately and apart on a permanent basis." The criterion specified in reg 1.15A(1A) must be satisfied at the time of the visa application (Regulations, Sched 2, Subdiv 820.21) and the time of decision (Regulations, Sched 2, Subdiv 820.22). The application by Mr Kumar the Tribunal was received on 1 November 2004. At a hearing conducted by the Tribunal on 31 October 2005, Bell Mr Kumar was given a letter from the Tribunal addressed to him and bearing that date. The letter included the following: "Section 359A of the Act states that the Tribunal must explain, and invite comment on, 'particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review'. You are invited to comment on the following information. The Tribunal has received information, in confidence, stating that your marriage to your nominator is contrived for the sole purpose of migrating to Australia. This information is relevant to the review because it may lead the Tribunal to find that you and your nominator are not in a genuine and continuing relationship as required by Regulation 1.15A. The above information does not include information that you gave the Tribunal for the purpose of the application, or information that, under the Act, is non-disclosable. You are invited to provide the requested information, in writing, within 28 days of the date of notification of this invitation. As this letter has been given by hand, you will be considered to have been notified of this invitation on the date of this letter. The effect of this is that you have a total of 28 days from the date of this letter to respond. If you are unable to provide the requested information within this period, you may request in writing that you be allowed additional time in which to respond. Such a request would need to include reasons for the extension and to be received before the end of the above period. The Tribunal will consider any request for an extension carefully, and advise you, in writing, whether an extension of time has been granted. If the Tribunal does not receive any additional information within the period allowed or as extended, it may make a decision on the review without taking any further action to obtain the information." (italicised emphasis added) At the hearing, Mr Kumar denied that the allegation in the letter was true. No further evidence or comments were received by the Tribunal within the Bell 28 day period indicated in the letter. In its reasons dated 3 February 2006, the Tribunal stated: "The Tribunal is not satisfied that there is sufficient evidence before it of the financial aspects of the relationship to indicate that the relationship is a genuine relationship. The Tribunal is not satisfied as to the nature of the household of the visa applicant and the nominator. The visa applicant has not been able to satisfactorily explain to the Tribunal why he is not residing with the nominator. There is insufficient evidence before the Tribunal to satisfy it that at the time of decision the visa applicant and the nominator hold themselves out to the world as being in a Most importantly, the credible and significant adverse information before the Tribunal leads the Tribunal to find that the visa applicant and the nominator are not in a genuine and The references to a range of matters in the first four sentences reflect the provisions of reg 1.15A(3) which require the Minister to "have regard to all of the circumstances of the relationship" including financial aspects of the relationship, the nature of the household, the social aspects of the relationship and the nature of the commitment of the parties to each other. The final sentence reflects the information identified in the letter of 31 October 2005. The Full Court upheld the submission by Mr Kumar that the decision of the Tribunal was the product of jurisdictional error by reason of what was said to be the failure of the Tribunal (in the letter dated 31 October 2005 and otherwise) to comply with the requirement imposed by s 359A of the Act that it disclose to him "the identity of the informant and the full nature of the information". Section 359A appears in Pt 5 of the Act, which deals with review of decisions of the Migration Review Tribunal. It resembles s 424A, which appears in Pt 7, dealing with review of protection visa decisions by the Refugee Review Tribunal. Division 5 of Pt 5 (ss 357A-367) is headed "Conduct of review" and s 357A(1) states that Div 5 is "taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with". Section 359A states: "Applicant must be given certain information Subject to subsection (2), the Tribunal must: Bell give to the applicant, in the way that the Tribunal considers appropriate the circumstances, particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review; and ensure, as far as is reasonably practicable, that the applicant understands why it is relevant to the review; and invite the applicant to comment on it. The information and invitation must be given to the applicant: except where paragraph (b) applies – by one of the methods specified in section 379A; or if the applicant is in immigration detention – by a method prescribed for the purposes of giving documents to such a person. This section does not apply to information: that is not specifically about the applicant or another person and is just about a class of persons of which the applicant or other person is a member; or that the applicant gave for the purpose of the application; or that is non-disclosable information." (emphasis added) The expression "non-disclosable information" is defined in s 5(1) as meaning: "information or matter: (a) whose disclosure would, in the Minister's opinion, be contrary to the national interest because it would: prejudice the security, defence or international relations of Australia; or involve the disclosure of deliberations or decisions of the Cabinet or of a committee of the Cabinet; or Bell (b) whose disclosure would, in the Minister's opinion, be contrary to the public interest for a reason which could form the basis of a claim by the Crown in right of the Commonwealth in judicial proceedings; or whose disclosure would found an action by a person, other than the Commonwealth, for breach of confidence; and includes any document containing, or any record of, such information or matter". (emphasis added) For the reasons which follow the appeal by the Minister should succeed, the substantive orders of the Full Court should be set aside and the appeal to that Court should be dismissed. However, the orders of this Court respecting non-publication made 30 September and 12 December 2008 will remain in force in accordance with their terms until further order of this Court. The term "non-disclosable information" appears not only in s 359A. It appears also in s 57 (exclusion from "relevant information" to be given to non-citizen visa applicants); s 66 (exclusion from written reasons for visa refusals); ss 119, 120 and 129 (exclusion from relevant information to be given by the Minister in visa cancellation procedure); s 424A (to which reference has been made); and ss 501C, 501G and 500(6F) (respectively refusals and cancellations of visas by the Minister, and review thereof). In its present form, par (c) of the definition of "non-disclosable information" was introduced by the Migration Legislation Amendment Act 1994 (Cth)5. Previously, the paragraph had read, "information or matter that was given to the Minister or an officer in confidence". The change was designed to avoid the literal interpretation of the earlier provision as encompassing "information which was not inherently confidential and information provided by other Commonwealth Departments"6. Several points should be observed concerning the construction of the definition of "non-disclosable information" in its application to s 359A. First, the phrase in pars (a), (b) and (c), "whose disclosure", must be read with the 5 By s 4(e). 6 Australia, House of Representatives, Migration Legislation Amendment Bill 1994, Explanatory Memorandum at 5. Bell substantive provision made by s 359A. This suggests the answer to the question "disclosure by whom?". An answer must be "disclosure by the Tribunal". The upshot is that the obligation imposed upon the Tribunal by s 359A(1) to give certain information to the applicant does not arise if disclosure by the Tribunal would found an action by the informant or another person (not being the Commonwealth) for breach of confidence. Secondly, the introduction into the Act of the expression "found an action ... for breach of confidence" may immediately invite attention to the body of doctrine in private law concerned with the protection, particularly by equitable remedies, of confidential information. But, as further remarked in what follows in these reasons, caution is required in the immediate translation into public law of such private law concepts. This is so even where no statutory regime is immediately involved. The reasoning of Mason J in The Commonwealth v John Fairfax & Sons Ltd7 is in point. The Commonwealth relied upon the protection given by equity to confidential information, but Mason J observed8: "The equitable principle has been fashioned to protect the personal, private and proprietary interests of the citizen, not to protect the very different interests of the executive government. It acts, or is supposed to act, not according to standards of private interest, but in the public interest. This is not to say that equity will not protect information in the hands of the government, but it is to say that when equity protects government information it will look at the matter through different spectacles." Where a statutory regime such as the migration legislation is involved the consideration stressed by Mason J becomes, if anything, plainer. If the terms of a statute take as a criterion for its operation a particular doctrine of the general law the resulting compound may have elements of indeterminacy. One reason for this may be found in the statement by Francis Bennion9 that a statute "takes on a life of its own". The particular doctrine of the general law, in this case that respecting the protection of confidential information, may have been framed by (1980) 147 CLR 39; [1980] HCA 44. (1980) 147 CLR 39 at 51. 9 See Bennion on Statutory Interpretation, 5th ed (2008) at 1459-1460. Bell judicial decisions addressed to ends which do not precisely correspond to those of the statute in question. The translation from private to public law must accommodate the scope and purpose of the public law regime. So it is in the present case. What was said in the judgment of the Court in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs10 is significant for the issues on the present appeal. Their Honours stressed both the requirement of the Act that those entitled to a particular visa be granted it and that those not entitled be refused, and the corollary that information supplied by an informer be not denied to the executive branch in its administration of the legislation. Section 359A is designed to accommodate those concerns. It affords to visa applicants a measure of procedural fairness and protection to informants, lest, without that protection, information be withheld and the Tribunal be denied material which assists the performance of its functions. The obligation imposed upon the Tribunal by s 359A did not apply to information or matter whose disclosure by the Tribunal would have founded an action by the informant for breach of confidence. This follows from the opening words of s 359A(4), "This section does not apply ...". The leading judgment in the Full Court was delivered by Besanko J. His Honour accepted that "the information in this case is capable of precise identification" and that "it was imparted in circumstances importing an obligation of confidence". Nevertheless, Besanko J went on to decide that: "the information, including the identity of the informant, was not non-disclosable information. The Tribunal failed to comply with s 359A in that it did not disclose to [Mr Kumar] the identity of the informant and the full nature of the information." The consideration which impressed the Full Court was that the general law does not protect confidences about such matters as the commission of crimes and frauds. In A v Hayden11, when giving their reasons for answering the 10 (2005) 225 CLR 88 at 98 [23]-[24], 100 [29]; [2005] HCA 72. 11 (1984) 156 CLR 532 at 556 per Mason J, 571-574 per Wilson and Dawson JJ, 595-596 per Deane J; [1984] HCA 67. Bell questions in the case stated and questions reserved by Dawson J to the Full Court, Mason, Wilson, Deane and Dawson JJ concluded that a court will not lend its aid to the enforcement of a contractual obligation of confidentiality undertaken by the Commonwealth, the effect of which would be to obstruct the administration of the criminal law. That situation may be contrasted with that on the present appeal. The preservation of the confidence of the informant's disclosures respecting the position of Mr Kumar tends to advance not obstruct the operation of the spousal visa provisions of the Act. It may be accepted that similar considerations to those which underpinned the result in A v Hayden apply also in the general law regarding non-contractual and purely equitable obligations of confidence. It has been said both in the courts of Australia and the United Kingdom that the disclosure of an "iniquity" will not be restrained as the subject matter of an obligation of confidence12. This is not the occasion to consider further any uncertainties which attend the equitable doctrine of confidence as it operates outside the provisions of legislative measures such as s 359A. It is sufficient to indicate two points. The first was made by Gibbs CJ in A v Hayden13. His Honour referred to the refusal of relief by a court of equity "to enforce an obligation of confidentiality when the consequence would be to prevent the disclosure of criminality which in all the circumstances it would be in the public interest to reveal". To similar effect is the passage in a leading United Kingdom text14: "Something may present a serious risk to the medical health of the public, national security, the administration of justice or a matter of comparable public importance such that it may fairly be regarded as necessary in the public interest that a person possessing such information should be free to disclose it to an appropriate third party, whether or not the matter involves individual wrongdoing (by the claimant or anyone else). As in the case of 'iniquity', so also in the case of such information, it may be said that no court would imply a contractual obligation prohibiting 12 See A v Hayden (1984) 156 CLR 532 at 544-547; Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 at 454-456; Attorney-General v Observer Ltd [1990] 1 AC 109 at 282-283. 13 (1984) 156 CLR 532 at 544-545. 14 Toulson and Phipps, Confidentiality, 2nd ed (2006), §6-022. Bell such disclosure, or enforce an express contractual prohibition, and that such information would be regarded both at common law and in equity as lacking the necessary attribute of confidence to prevent such disclosure. ... It would be wholly unsatisfactory if, for example, a hospital doctor were prevented by his contract of employment from notifying the Department of Health of an imminent risk to public health detected by him in the course of his hospital duties, whether misconduct was involved or not." However, the second point is that these remarks are not directed to the situation in which the Tribunal is placed. These remarks are directed to the situation where, for example, X wishes to make disclosures to the migration authorities concerning the true position of Y under the legislation, but X may be constrained from making the disclosure because the information was acquired by X under a cloak of confidence. The observations of Gibbs CJ and of Lord Justice Toulson and Mr Phipps in their work are directed to an answer by X at the suit of Y. The Tribunal is in a different position. The Tribunal has acquired information adverse to the interests of Mr Kumar and acquired it by confidential disclosure from an informant. The issue concerns the existence and extent of any obligation imposed upon the Tribunal by s 359A to break that confidence of the informant. Let it be assumed, without further entering upon the question, that the precisely identified information supplied to the migration authorities by the informant indicated that Mr Kumar or another person or persons may have committed offences against the laws of the Commonwealth. The question then is whether on its proper construction s 359A obliges the Tribunal, in affording procedural fairness to Mr Kumar, to break the confidence of the informant by revealing that information and the identity of the informant. Mr Kumar submits that knowledge of the identity of the informant and the content of the information assists in understanding and thus in testing the cogency of the case against him and better discharges the obligation of procedural fairness of which s 359A is relevantly the "exhaustive statement" spoken of in s 357A. Bell However, although spoken in the application of general law principles of procedural fairness rather than in the application of s 359A, the following passage from VEAL15 points to the answer in this appeal: "To give the appellant a copy of the letter or tell him who wrote it would give no significance to the public interest in the proper administration of the Act which, as pointed out earlier, required that those entitled to a visa be granted one and those not entitled be refused. It is in aid of that important public interest that, so far as possible, there should be no impediment to the giving of information to authorities about claims that are made for visas. That public interest, and the need to accord procedural fairness to the appellant, could be accommodated. They were to be accommodated, in this case, by the Tribunal telling the appellant what was the substance of the allegations made in the letter and asking him to respond to those allegations." Upon the proper construction of the Act, the circumstance that the information supplied in confidence to the Tribunal may have disclosed or related to the commission of offences by Mr Kumar or others did not deny to the information and the identity of the informer the character of non-disclosable information within the meaning of s 359A(4). The Tribunal was obliged by s 359A(1) to give "particulars of any information that the Tribunal considers would be ... part of the reason, for affirming the decision" of the delegate. The "information" there spoken of did not include the non-disclosable information (s 359A(4)). The Tribunal complied with s 359A(1) by notifying Mr Kumar that it had received information, in confidence, which stated that his marriage was contrived for the sole purpose of his migration to Australia, and inviting his response. The Tribunal found that there was insufficient evidence upon which it could satisfy itself that, at the time of the decision under review, Mr Kumar and his wife held themselves out to the world as being in a genuine spousal relationship. If that conclusion were, as it was expressed to be, independent of the non-disclosable information relied upon by the Tribunal then even in the absence of that information Mr Kumar could not have succeeded. However, the proposition that this conclusion stood independent of the non-disclosable information, was not advanced on the appeal. 15 (2005) 225 CLR 88 at 100 [29]. Bell The appeal should be allowed. The Minister undertook on the grant of special leave to pay the costs of Mr Kumar in any event. Orders 1 and 2 of the orders of the Full Court entered 23 May 2008 should be set aside and the appeal to that Court should be dismissed.
HIGH COURT OF AUSTRALIA AND THE QUEEN APPELLANT RESPONDENT Collins v The Queen [2018] HCA 18 9 May 2018 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland dated 2 June 2017 and in lieu thereof order that: the appellant's appeal to that Court be allowed; the appellant's convictions and sentences be quashed; and a new trial be had. On appeal from the Supreme Court of Queensland Representation P J Callaghan SC with D K Fuller for the appellant (instructed by Legal Aid Queensland) M R Byrne QC for the respondent (instructed by Director of Public Prosecutions (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Collins v The Queen Criminal law – Appeal against convictions – Jury direction – Prior inconsistent statement – Where appellant indicted for indecent assault, aggravated indecent assault and rape – Where consent main issue at trial – Where complainant made preliminary complaints to mother and others – Where mother gave evidence at committal hearing – Where mother gave different account at trial – Where trial judge directed jury committal evidence could only be used to assess mother's credibility – Where mother confirmed at trial she had given that evidence at committal and her memory was better at committal – Whether mother actually adopted committal evidence – Whether prior inconsistent statement available to jury to assess complainant's credibility – Whether trial judge misdirected jury. Criminal law – Appeal against convictions – Application of proviso – Where Court of Appeal found erroneous jury direction – Where prosecution disavowed reliance on proviso – Where Court of Appeal applied proviso without notice and notwithstanding disavowal – Whether Court of Appeal bound to put appellant on notice of possibility of applying proviso. Words and phrases – "preliminary complaint", "prior inconsistent statement", "proviso", "substantial miscarriage of justice". Criminal Code (Q), ss 337, 349, 352, 668E(1A). KIEFEL CJ, BELL, KEANE AND GORDON JJ. The appellant was tried before the District Court of Queensland (Judge Farr SC and a jury) on an indictment that charged him with indecent assault1 (count one), aggravated indecent assault2 (counts two and three) and rape3 (count four). The offences were alleged to have been committed against the same complainant on the evening of 11 January or the morning of 12 January 2000. The trial commenced on 27 October 2014. On 30 October 2014 the jury returned verdicts of guilty on each count. The appellant was sentenced to a term of nine years and four months' imprisonment on the conviction for rape, and to shorter concurrent sentences on the remaining convictions. The appellant appealed against his convictions to the Court of Appeal of the Supreme Court of Queensland (Gotterson and Morrison JJA and Burns J) on a single ground which challenged the directions given to the jury concerning the use that could be made of the evidence of the complainant's mother, Ms M, of her daughter's preliminary complaint to her. The challenge succeeded. Nonetheless, the Court of Appeal found that the misdirection had not occasioned a substantial miscarriage of justice and the appeal was dismissed under s 668E(1A) of the Criminal Code (Q) ("the Code"): the "proviso" to the common form criminal appeal provision. The Court of Appeal did not put the appellant on notice that it was disposed to dismiss the appeal under the proviso. This was so notwithstanding that on the hearing of the appeal the prosecutor had submitted that, if the appellant's challenge succeeded, it could not be said that no substantial miscarriage of justice had actually occurred4. On 17 November 2017, Gageler, Nettle and Gordon JJ granted the appellant special leave to appeal to challenge the Court of Appeal's determination to dismiss the appeal under the proviso. By notice of contention, the respondent seeks to have the Court of Appeal's order affirmed on the ground that the trial judge's directions concerning Ms M's evidence were correct. For the reasons to be given, the respondent's contention is rejected and the appellant's ground succeeds; it was an error to dismiss the appeal without giving the appellant the 1 Criminal Code (Q), s 337; the provision has since been repealed and the offence of indecent assault is found in s 352 of the Code. 2 Criminal Code (Q), s 337(3); see fn above – the offence of aggravated indecent assault is found in s 352(2) of the Code. 3 Criminal Code (Q), s 349. 4 R v Collins [2017] QCA 113 at [71]. Bell Gordon opportunity to address the Court on the reasons why it should not find that no substantial miscarriage of justice had actually occurred. It is now more than 18 years since the date of the alleged offences. In the circumstances, the parties were agreed that, should the appeal succeed, the matter should not be remitted to the Court of Appeal; this Court should consider for itself whether notwithstanding the misdirection no substantial miscarriage of justice actually occurred. That consideration does not support the conclusion that there has been no substantial miscarriage of justice. It follows that the appeal must be allowed and a new trial ordered5. The evidence The following summary of the evidence is drawn largely from Burns J's reasons in the Court of Appeal. The appellant was aged 61 years at the date of these events and the complainant was aged 19 years. The appellant was living on a yacht moored at a marina in Southport. He placed an advertisement in a newspaper for a nanny to accompany him and his partner and their child on a sailing trip to the Whitsundays. The complainant saw the advertisement and contacted the appellant and expressed her interest in the position. It was agreed that she would attend for an interview the following day. The complainant brought her friend AJ and AJ's young son with her to the interview, which was conducted on board the appellant's yacht. After the interview, the appellant took them to a club and bought them some drinks. Later that evening, the appellant telephoned the complainant and suggested that she return to the yacht and spend some time with him in order to see whether "personality wise" they could live together at sea. She declined to do so at that time. The complainant returned for that purpose about a week later on 11 January 2000. On this occasion, she travelled alone. The appellant collected her by car from the train station and they drove to the marina. On the way they stopped at a hotel where they had "a couple of drinks". After this, they purchased supplies of alcohol and groceries. By the time they arrived at the yacht it was dark. They drank some more alcohol before leaving the yacht to go to dinner at a nearby restaurant. The restaurant was fully booked and they returned to the yacht, where the appellant cooked a meal. They ate, talked and continued drinking. 5 Criminal Code (Q), s 669. Bell Gordon At about 11:00 pm the complainant was feeling a "bit drunk", a "bit tired" and "ready for bed". She knew that she had had enough to drink and that it was "time to stop". She asked the appellant whether she could shower and he directed her to the bathroom adjoining his bedroom. After she had removed all her clothes, the appellant entered the bathroom and took hold of her and pushed her onto the bed, telling her that he wanted to shave her. The complainant protested. The appellant had hold of a pair of electric clippers and he proceeded to shave her pubic area despite her protests, telling her that he would make her look good. This conduct was charged in the first count. After being shaved, the complainant went back to the bathroom and showered. She then returned to the dining area of the yacht, where she and the appellant had "a couple of drinks". The complainant then said that she would like to go to bed. At this point, the appellant "dragged" her to his bedroom. She tried to stop him, saying that she did not want to go with him but he persisted. He removed her pants and pushed her onto the bed. He took off his trousers and straddled her, placing his penis in her mouth. This conduct was charged in the second count. The appellant then pulled the complainant's legs apart and licked her vagina. This conduct was charged in the third count. The complainant continued to protest and tried to close her legs but the appellant "kept pulling them apart". The appellant then penetrated the complainant with his penis. This conduct was charged in the fourth count. After these events, the appellant told the complainant that she should sleep at the other end of the yacht, as he snored. She did as instructed. On 12 January 2000, when the complainant woke, the appellant was not on the yacht. He sent her a text message asking her to clean up the yacht and telling her that there was a key for the shower at the marina. After cleaning the yacht, the complainant went to the marina and had a shower. While she was there she received a telephone call from AJ. The complainant gave the following account of her conversation with AJ: "I told her that [the appellant] raped me last night and that I'm scared and I don't know what I'm doing and I don't know where I am." AJ suggested that the complainant arrange for her to come to Southport. The complainant telephoned the appellant and asked him to collect AJ from the station. The appellant collected AJ and drove her to the yacht. AJ told the appellant that the complainant needed to go home because her "nan" needed her to come back and help her. The complainant and AJ caught a bus to the station and returned home. Bell Gordon The complainant telephoned her mother on 12 January 2000 ("the telephone call"). She recalled saying "Mum, he raped me" and she was "pretty sure" that she told her mother that she had been "silly" and that she "shouldn't have gone down [to Southport]". This was all that the complainant could remember of the telephone call. She was not challenged in cross-examination on this aspect of her evidence. The complainant made a statement to the police on 28 January 2000 and, on the same day, the police executed a search warrant on the appellant's yacht. Among the items located were electric clippers and a quantity of alcohol. Scientific examination of the clippers revealed the presence of the complainant's DNA on the blades. The appellant did not give or call evidence in his defence. He made a formal admission that on the evening of 11 January 2000 or the morning of 12 January 2000 he engaged in sexual intercourse with the complainant. It was the defence case that the complainant had become disinhibited by alcohol and shaved her pubic area before engaging in consensual oral and penile vaginal intercourse with the appellant. The complainant was cross-examined on inconsistencies between her evidence given at the trial and her earlier evidence at the committal hearing before the Magistrates Court in 2007. She was also challenged on inconsistencies between her evidence and statements attributed to her in a newspaper article written by a journalist, Ian Haberfield. The evidence of preliminary complaint Evidence of the making of a "preliminary complaint" given by the complainant, or the person or persons to whom the complaint was made, is received as an exception to the hearsay rule for the purpose of showing consistency of conduct6. A "preliminary complaint" is any complaint other than the complainant's first formal witness statement to a police officer given in, or in anticipation of, a criminal proceeding in relation to the alleged offence7. At the trial, evidence of preliminary complaint was given by the complainant and by Ms M, AJ and Ian Haberfield. AJ gave evidence that she telephoned the complainant at about 9:00 am and that the complainant sounded very upset. AJ asked what was wrong and, 6 Kilby v The Queen (1973) 129 CLR 460 at 472 per Barwick CJ; [1973] HCA 30. 7 Criminal Law (Sexual Offences) Act 1978 (Q), s 4A(2). Bell Gordon with some prodding, the complainant told her "John had raped her the previous night". Ian Haberfield, who was working for the newspaper which published the appellant's advertisement, interviewed the complainant after Ms M made contact with the newspaper. Mr Haberfield said that the complainant stated in the course of the interview that the appellant had "attacked" and "raped" her. In evidence in chief, Ms M gave an account of the telephone call in these terms: "[the complainant] phoned me to tell me that she had been raped". In cross-examination, Ms M was questioned about her evidence of the telephone call given at the committal hearing in 2007 ("the 2007 account"). In summary, in the 2007 account, Ms M said that the complainant told her: (i) "I think I've been raped", and (ii) "I had some wine and I felt funny and I don't remember every – anything after a certain time". The limitation on the use of the 2007 account The issue on which the appellant succeeded before the Court of Appeal, and which is the subject of the respondent's notice of contention, concerns the limitation placed on the use the jury could make of the 2007 account. The jury was directed that a prior inconsistent statement made by a witness is not evidence of the truth of what the witness said on the earlier occasion. The trial judge directed that the prior inconsistent statement, if proved, "is relevant to the credibility of that particular witness when you're assessing that person's evidence". His Honour went on to direct: "You also, however, heard evidence from the complainant's mother about the complaint that she was given by her daughter the following day. What she told the committal proceeding court seven years ago and what she has said today was said to be different. That direction relates to that as well. That inconsistency between what the mother told the committal court seven years ago and what she told today, depending upon your view of it, impacts, potentially upon the mother's credibility and reliability. But what the mother said to the committal court seven years ago is not evidence of the fact that the complainant said those things to her. It's not evidence of the truth of the contents of the statement if you can follow that logic. It impacts upon the particular witness's credibility who's giving the evidence." (emphasis added) Bell Gordon The Court of Appeal explained that where a witness adopts parts of a previous statement, those parts form part of the witness's oral testimony at the trial8. Their Honours concluded that Ms M had adopted the 2007 account with the result that it formed part of Ms M's evidence and it was for the jury to assess whether it accepted that account or the account given by Ms M in chief9. Contrary to the trial judge's direction, their Honours said it was open to the jury to assess the credibility and reliability of the complainant's evidence against the 2007 account of her preliminary complaint. The respondent does not dispute the latter conclusion. The respondent takes issue with the anterior finding that Ms M adopted the 2007 account as accurate. To assess the argument it is necessary to set out the terms of the cross-examination of Ms M at some length: "DEFENCE COUNSEL: So – all right. And you've indicated that you can't recall the exact terms of what she said? A: Well, it was quite some time ago, as you can appreciate. DEFENCE COUNSEL: Yes. Well, your memory was better back in A: I would think so. DEFENCE COUNSEL: And you gave evidence about what you recalled at that stage? A: Yes. DEFENCE COUNSEL: And I'd suggest you said, 'I'm not even sure that the words were, "I was raped". I believe she said, "I think I was raped", because she was – she was, "Mum, I think he's drugged me and I think he's raped me."' Do you recall you gave that evidence? 8 R v Collins [2017] QCA 113 at [49] citing The Queen's Case (1820) 2 Brod & B 284 at 313 per Abbott CJ [129 ER 976 at 988]; R v Soma (2003) 212 CLR 299 at 316 [55] per McHugh J; [2003] HCA 13; and R v CBL and BCT [2014] 2 Qd R 331 9 R v Collins [2017] QCA 113 at [52] citing CB v Western Australia (2006) 175 A Crim R 304 at 316 [53]. Bell Gordon A: Well, if I gave it at that time, then that's how I would have remember [sic] it." Ms M was handed a copy of the transcript of the evidence that she gave in 2007 at the committal hearing and she was asked: "DEFENCE COUNSEL: Do you agree you gave that evidence? A: Well, it's written so I must have. DEFENCE COUNSEL: You accept that? A: Yes. DEFENCE COUNSEL: All right. And I'd suggest you also gave evidence further – I don't need you to look at those yet – that she rang up, she was crying, she was hysterical and she said, '"Mum, I think I've been raped. I had some wine and I felt funny and I don't remember every – anything after a certain time, and when I woke up" – I can't remember what she said after that. And I said, "Well, you know, how did this happen?" And she said, "Mum, I don't know. I – we had a glass of wine to celebrate."' Do you agree you gave that evidence? A: Yes. DEFENCE COUNSEL: And you went on to say, 'No, she didn't say she was drunk'. And, 'Just that she couldn't understand why she doesn't remember anything because she didn't have that much to drink.' Do you agree you gave that evidence? A: Yes. DEFENCE COUNSEL: All right. And does that assist you that whilst you might have taken away from the conversation that she thought she'd been raped, what she actually told you was that she couldn't remember what had happened after a certain point? A: I can appreciate what you're saying, but what you need to remember is that the phone call happened in 2000. Bell Gordon DEFENCE COUNSEL: I appreciate that. I'm not being critical of you. You can't say anything further than, your memory, when you gave evidence back on the 21st of September 2007, was better than it is now? A: Yes. I would say so, yes. DEFENCE COUNSEL: And when you gave that evidence, that was the best recollection you could give to the court of what she said to you? A: Yes. I would say so, yes." The Court of Appeal observed that defence counsel sought to have Ms M: (i) distinctly admit that she had given evidence at the committal hearing relative to the subject matter of the proceeding10; (ii) agree that the parts of that evidence that Ms M was taken to were more reliable than her trial testimony because her "memory was better back in 2007"; and (iii) accept that those parts of the evidence given at the committal hearing were true (or accurate), in that they represented "the best recollection [she] could give to the court". Their Honours concluded that all three objectives had been achieved11 and it followed that the 2007 account formed part of Ms M's oral testimony. The respondent's contention The respondent is critical of defence counsel's failure to obtain Ms M's acknowledgement of the accuracy of the 2007 account. Her acknowledgement that she had given her best recollection to the court in 2007 is said to fall short of acceptance of the truth or accuracy of the account. In circumstances in which the 2007 account was not given close in time to the telephone call, the respondent contends that there is no sound basis to infer its accuracy. Absent a clear acknowledgement of its accuracy, the respondent submits that the 2007 account went only to Ms M's credit and the directions given to the jury were unimpeachable12. 10 Evidence Act 1977 (Q), s 18. 11 R v Collins [2017] QCA 113 at [59]. 12 Taylor v The King (1918) 25 CLR 573 at 574-575; [1918] HCA 68; Driscoll v The Queen (1977) 137 CLR 517 at 536 per Gibbs J; [1977] HCA 43; Lee v The Queen (1998) 195 CLR 594 at 603 [39] per Gleeson CJ, Gummow, Kirby, Hayne and Callinan JJ; [1998] HCA 60; Bull v The Queen (2000) 201 CLR 443 at 466 [79] per McHugh, Gummow and Hayne JJ; [2000] HCA 24. Bell Gordon The respondent's contention rests on the significance that is to be attached to the concluding question and answer extracted above: "DEFENCE COUNSEL: And when you gave that evidence, that was the best recollection you could give to the court of what she said to you? A: Yes. I would say so, yes." On the hearing of the appeal the respondent accepted that, had Ms M's answer to this question been an unqualified "yes", it would have sufficed as an adoption of the 2007 account as accurate. As it stands, the respondent argues, Ms M's qualified answer is consistent with her acknowledgement of giving the 2007 account and with her inability at the date of the trial to be certain in her own mind whether that account or the account given in chief was true. The fact that the 2007 account was of a conversation that occurred seven years earlier was relevant to the weight of the evidence but it does not detract from the Court of Appeal's analysis of the status of the evidence. The Court of Appeal did not err in concluding that Ms M's acceptance: (i) that her recollection in 2007 of the telephone call was likely to be better than her recollection of the call in 2014, and (ii) that she had endeavoured to give the court in 2007 her best recollection of the telephone call, sufficed as her adoption of the 2007 account as an accurate account. It follows that the Court of Appeal did not err in holding that the jury should not have been instructed that the only use it might make of the 2007 account was in assessing the credibility and reliability of Ms M's evidence. The 2007 account formed part of Ms M's evidence of the preliminary complaint in the trial13. It was not evidence of any underlying fact asserted by the complainant14 but it was evidence of the terms of her complaint. It was open to the jury to prefer the 2007 account to Ms M's account in chief. In contrast to the latter, the 2007 account did not tend to support acceptance of the reliability of the complainant's evidence. 13 Morris v The Queen (1987) 163 CLR 454 at 469 per Deane, Toohey and Gaudron JJ; [1987] HCA 50; Sainsbury v Allsopp (1899) 24 VLR 725 at 728 per Hood J; R v Thynne [1977] VR 98 at 100; CB v Western Australia (2006) 175 A Crim R 304 at 316 [53]. 14 Jones v The Queen (1997) 191 CLR 439; [1997] HCA 56; R v Lillyman [1896] 2 Bell Gordon The proviso Section 668E of the Code is in the common form: on an appeal against conviction the appellate court is to allow the appeal if it is of opinion that the verdict of the jury should be set aside under any of three limbs in sub-s (1) and in any other case the court is to dismiss the appeal. Sub-section (1A) is in familiar terms and provides that the appellate court may, notwithstanding that it is of the opinion that the point or points raised by the appeal might be decided in the appellant's favour, dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred. In his written submissions filed in the Court of Appeal, the appellant submitted that, should his ground succeed, his appeal should not be dismissed under the proviso. The prosecution did not submit to the contrary in the written submissions filed on its behalf. As earlier noted, on the hearing of the appeal in the Court of Appeal, the prosecutor made a concession that "if the appellant's argument was accepted, it could not be submitted that there had been no substantial miscarriage of justice"15. The Court of Appeal did not accept the prosecution's concession because, after making an independent assessment of the evidence, their Honours were satisfied that the appellant's guilt had been proved beyond reasonable doubt16. The appellant submits that it was not open to the Court of Appeal to "override" the prosecution's disavowal of the proviso and dismiss his appeal without warning of the intention to do so and giving him the opportunity to be heard on the matter. The respondent contends that the Court of Appeal's disposition of the appeal was a correct application of the principles governing dismissal under the proviso explained in Lindsay v The Queen17. In Lindsay, the Court of Criminal Appeal of South Australia dismissed Lindsay's appeal notwithstanding that the trial judge's directions on the partial defence of provocation were wrong because the Court considered that the partial defence should not have been left for the jury's consideration. The prosecutor at the trial had not submitted that provocation was not raised. In the Court of Criminal Appeal, the prosecution noted that dismissal under the proviso was an available disposition but did not invite the Court to adopt that course. On appeal in this Court, the proposition that in the absence of invitation it was not open to 15 R v Collins [2017] QCA 113 at [71]. 16 R v Collins [2017] QCA 113 at [72]. 17 (2015) 255 CLR 272 at 288-290 [43]-[48] per French CJ, Kiefel, Bell and Keane JJ, 294 [64] per Nettle J; [2015] HCA 16. Bell Gordon the Court of Criminal Appeal to dismiss an appeal under the proviso was rejected. As the joint reasons explained, such a proposition is inconsistent with the text and structure of the common form criminal appeal provision18. Importantly, in Lindsay, on the hearing in the Court of Criminal Appeal, it had been made plain to Lindsay's counsel that consideration of dismissal under the proviso was a live issue and counsel was given the opportunity to address that possibility19. The respondent submits that Lindsay is not to be distinguished on the basis that the prosecution did not, as here, disavow reliance on the proviso. The respondent characterises Lindsay as a case of non-reliance by omission and the present as a case of non-reliance by express statement. Each, the respondent emphasises, is a case of non-reliance. The respondent seeks to turn its concession in the Court of Appeal to advantage in this Court; the appellant's counsel is said to have been alive to the possibility of dismissal under the proviso, and, having raised the issue in his outline and having not been met by a counter-argument, he chose not to pursue the matter further. This, so the argument goes, was a valid tactical decision because pursuing the issue in oral argument risked raising matters that might be adverse to acceptance of defence counsel's written outline. The submission is apt to fly in the face of the assumption underpinning the conduct of adversarial proceedings that, generally, the parties are responsible for defining the issues. As explained in Baiada Poultry Pty Ltd v The Queen, notwithstanding the permissive language of the proviso, where the appellate court concludes that a demonstrated error or irregularity under the second or third limbs of the common form provision has not actually occasioned a substantial miscarriage of justice, it must dismiss the appeal20. It remains that the determination of whether an error or other irregularity has occasioned a substantial miscarriage of justice calls for a judgment upon which the parties are entitled to be heard. Absent any indication to the contrary, the prosecution's concession – that in the event the directions on the use the jury might make of Ms M's evidence were wrong, it could not be said 18 Lindsay v The Queen (2015) 255 CLR 272 at 289 [47] per French CJ, Kiefel, Bell and Keane JJ citing Baiada Poultry Pty Ltd v The Queen (2012) 246 CLR 92 at 103 [24] per French CJ, Gummow, Hayne and Crennan JJ; [2012] HCA 14. 19 Lindsay v The Queen (2015) 255 CLR 272 at 288-289 [45] per French CJ, Kiefel, 20 Baiada Poultry Pty Ltd v The Queen (2012) 246 CLR 92 at 103-104 [25]-[26] per French CJ, Gummow, Hayne and Crennan JJ. Bell Gordon that the error did not occasion a substantial miscarriage of justice – relieved the appellant of the need to address this issue. The Court of Appeal was not bound by the prosecution's concession, but it was obliged to put the appellant on notice that, notwithstanding the concession, dismissal under the proviso remained a distinct possibility, and to give the appellant an opportunity to persuade it against taking that course. A substantial miscarriage of justice? The Court of Appeal considered that the prosecution case was a strong one and their Honours were satisfied that guilt had been proved beyond reasonable doubt. The conclusion took into account three considerations. First, while there were inconsistencies in the complainant's account, these were largely with respect to matters of peripheral detail and otherwise the complainant appeared to have given "a relatively robust and unvarying account of the essential features of the conduct making up the offences"21. Secondly, the conclusion took into account the physical evidence of the clippers, which "supported parts of [the complainant's] account"22. And, thirdly, the conclusion took into account that preliminary complaints had been made not only to Ms M but also to AJ and Ian Haberfield23. The Court of Appeal separately identified one further consideration: the two aspects of the 2007 account that were inconsistent with Ms M's evidence in chief were not put to the complainant in cross-examination. Further, their Honours noted that the complainant's account of the telephone call was not challenged. Absent challenge to that account, the Court of Appeal said that the proposition that the jury was deprived of the chance to consider the 2007 account in assessing the complainant's evidence was "considerably weakened"24. To the extent that the last matter was taken into account in determining that no substantial miscarriage of justice had actually occurred, it was an error. Defence counsel was not bound to put the 2007 account to the complainant; the contents of the telephone call was not a matter upon which counsel had instructions and at the time the complainant was under cross-examination it was 21 R v Collins [2017] QCA 113 at [18]. 22 R v Collins [2017] QCA 113 at [72]. 23 R v Collins [2017] QCA 113 at [72]. 24 R v Collins [2017] QCA 113 at [73]. Bell Gordon not known whether Ms M would adopt the 2007 account. Moreover, even if counsel's cross-examination were open to criticism on this account, it is not apparent that the omission bears on the determination of whether no substantial miscarriage of justice actually occurred. The trial was fought on the issue of consent. On the complainant's account, she had consumed a substantial quantity of alcohol in the course of the evening before the subject events. The defence case as summarised by the trial judge was that the complainant's "degree of intoxication on the night in question may very well have affected her behaviour on the night, reduced her inhibitions and affected her memory". The capacity of the 2007 account, if accepted, to affect the jury's assessment of the credibility and reliability of the complainant's account of the offences is apparent. This is significant to the determination of whether the negative condition for dismissal under the proviso is satisfied25. Where, as here, proof of guilt is wholly dependent on acceptance of the complainant and the misdirection may have affected that acceptance, the appellate court cannot accord the weight to the verdict of guilty which it otherwise might. The 2007 account had the capacity to affect the assessment of the reliability of the complainant's account regardless of the terms of the complaints made to AJ and Ian Haberfield. As the Court of Appeal recognised, the presence of the complainant's DNA on the blades of the electric clippers did not bear relevantly on the issue of consent. Proof of guilt was wholly dependent on the complainant's evidence. Despite the Court of Appeal's acknowledgement of the natural limitations that apply to appellate review of the record26, their Honours' conclusion paid insufficient regard to those limitations. It cannot be concluded that no substantial miscarriage of justice actually occurred. Orders For these reasons, there should be the following orders: Allow the appeal. Set aside the order of the Court of Appeal of the Supreme Court of Queensland dated 2 June 2017 and in lieu thereof order that: 25 Weiss v The Queen (2005) 224 CLR 300 at 317 [44]; [2005] HCA 81. 26 R v Collins [2017] QCA 113 at [72]. Bell Gordon the appellant's appeal to that Court be allowed; the appellant's convictions and sentences be quashed; and a new trial be had. Edelman EDELMAN J. For the reasons given in the joint judgment, the Court of Appeal of the Supreme Court of Queensland was correct that the trial judge misdirected the jury. The evidence given by the complainant's mother at the 2007 committal hearing was adopted by her at trial when she gave evidence as part of the prosecution case. The trial judge erred in directing the jury that the evidence from the complainant's mother concerning what she had said in 2007 could not be used to assess the credibility of the complainant. The respondent's notice of contention should be dismissed. The Court of Appeal dismissed the appeal by relying upon the common form proviso to the requirement that an appeal must be allowed if "on any ground whatsoever there was a miscarriage of justice"27. Over the many decades that the common form proviso has been in force, there has been much written about its meaning, which is expressed in deceptively simple terms requiring28 the court to dismiss the appeal "if it considers that no substantial miscarriage of justice has actually occurred"29. It is true that the Court of Appeal was not bound by the respondent's concession that if a miscarriage of justice had occurred it would be substantial. But the Court of Appeal was required to give the appellant the opportunity of making submissions on this issue before reaching that conclusion. Since this Court has now heard submissions on the proviso, and since the circumstances described in the joint judgment make it appropriate for this Court to decide the point, the remaining question for this Court is whether a substantial miscarriage of justice occurred. In Kalbasi v Western Australia30, the joint judgment of a majority of this Court held that a negative proposition needed to be satisfied before an appeal court could conclude that no substantial miscarriage of justice had occurred. The necessary condition in that negative proposition, as expressed in Weiss v The Queen31, is that an appeal court cannot dismiss the appeal unless the court, itself, is satisfied beyond reasonable doubt of the appellant's guilt. In my dissenting reasons, I held that this satisfaction should not supplant the basic test for determining whether there was a substantial miscarriage of justice. The basic test applies unless the error is so fundamental that it can be said, without more, to be a substantial miscarriage of justice. That basic test is whether conviction by 27 Criminal Code (Q), s 668E(1). 28 Baiada Poultry Pty Ltd v The Queen (2012) 246 CLR 92 at 103-104 [26] per French CJ, Gummow, Hayne and Crennan JJ; [2012] HCA 14. 29 Criminal Code (Q), s 668E(1A). 30 (2018) 92 ALJR 305; 352 ALR 1; [2018] HCA 7. 31 (2005) 224 CLR 300 at 317 [44]; [2005] HCA 81. Edelman the jury, acting reasonably, was inevitable. Or, as Gageler J said in Kalbasi, "the ultimate question ordinarily to be addressed in the application of the proviso is whether the jury's verdict might have been different if the identified error had not occurred"32. This basic test of "inevitability of conviction" has been expressed in numerous decisions of this Court prior to33 and since34 Weiss. It has been suggested that there are "oddities"35 arising from the contrast between the negative proposition in Weiss and the inevitability of conviction formulation. It is unnecessary in this case to consider whether there is any difference in theory or application between the two formulations, including whether the negative proposition could be seen merely as a necessary 32 (2018) 92 ALJR 305 at 320 [64], see also at 321-322 [71] per Gageler J, 331 [124], 334 [135] per Nettle J; 352 ALR 1 at 19, see also at 21-22, 34, 38. 33 Gallagher v The Queen (1986) 160 CLR 392 at 412-413 per Dawson J; [1986] HCA 26; Wilde v The Queen (1988) 164 CLR 365 at 372 per Brennan, Dawson and Toohey JJ; [1988] HCA 6; Festa v The Queen (2001) 208 CLR 593 at 631 [121] per McHugh J, 636 [140] per Kirby J, 661 [226] per Hayne J; [2001] HCA 72; Conway v The Queen (2002) 209 CLR 203 at 226 [63] per Gaudron ACJ, McHugh, Hayne and Callinan JJ; [2002] HCA 2; Arulthilakan v The Queen (2003) 78 ALJR 257 at 269 [62], 270-271 [68]-[69] per Kirby J; 203 ALR 259 at 275, 276-277; [2003] HCA 74; Kamleh v The Queen (2005) 79 ALJR 541 at 547 [29] per Kirby J, 549 [39] per Heydon J; 213 ALR 97 at 104, 106; [2005] HCA 2. See also Mraz v The Queen (1955) 93 CLR 493 at 514 per Fullagar J; [1955] HCA 59; Driscoll v The Queen (1977) 137 CLR 517 at 524-525 per Barwick CJ; [1977] HCA 43; R v Storey (1978) 140 CLR 364 at 376 per Barwick CJ; [1978] HCA 39. 34 Darkan v The Queen (2006) 227 CLR 373 at 402 [95] per Gleeson CJ, Gummow, Heydon and Crennan JJ, 407 [117] per Kirby J; [2006] HCA 34; Baiada Poultry Pty Ltd v The Queen (2012) 246 CLR 92 at 106-107 [35]-[38] per French CJ, Gummow, Hayne and Crennan JJ; Baini v The Queen (2012) 246 CLR 469 at 481- 482 [33], 484 [40] per French CJ, Hayne, Crennan, Kiefel and Bell JJ; [2012] HCA 59; Lindsay v The Queen (2015) 255 CLR 272 at 276 [4] per French CJ, Kiefel, Bell and Keane JJ, 301-302 [86] per Nettle J; [2015] HCA 16; Castle v The Queen (2016) 259 CLR 449 at 472 [65] per Kiefel, Bell, Keane and Nettle JJ, Gageler J agreeing at 477 [82]; [2016] HCA 46; R v Dickman (2017) 91 ALJR 686 at 688 [4]-[5], 697 [63] per Kiefel CJ, Bell, Keane, Nettle and Edelman JJ; 344 ALR 474 at 476, 488; [2017] HCA 24. See also Pollock v The Queen (2010) 242 CLR 233 at 252 [70] per French CJ, Hayne, Crennan, Kiefel and Bell JJ; [2010] HCA 35; Filippou v The Queen (2015) 256 CLR 47 at 55 [15] per French CJ, Bell, Keane and Nettle JJ; [2015] HCA 29. 35 Mildren, The Appellate Jurisdiction of the Courts in Australia, (2015) at 89. Edelman requirement for one technique by which an appellate judge might assess whether conviction by the jury was inevitable. It suffices to make two observations. The first observation is that, on any view, the ultimate question must be whether there was a substantial miscarriage of justice. The second observation is that, as a matter of application, there may be very few cases where there could be any difference in result between asking (i) whether conviction by the jury, acting reasonably, was inevitable, and (ii) whether the appeal court, or perhaps more accurately the individual appeal judge, is satisfied beyond reasonable doubt of the appellant's guilt. The prospect of any difference in result is also reduced substantially by the requirement that the appeal judge take into account the verdict of the jury when assessing whether he or she is satisfied of guilt beyond reasonable doubt36. This requirement means that the two approaches might generally align in the case of a "harmless error"37 that did not affect the trial in any fundamental way and that was so insignificant that there was no reasonable possibility that it could have led a jury to acquit38. This would be so, even if the natural advantages of the jury meant that the appellate judge's satisfaction of guilt beyond reasonable doubt was dependent upon his or her conclusion that the jury's verdict could not have been affected by the error. The misdirection by the trial judge that prevented the jury from using the evidence from the complainant's mother concerning what she had said in 2007 to assess the credibility of the complainant was not so fundamental that it could be said, without more, that there was a substantial miscarriage of justice. Nevertheless, the error was significant. As the joint reasons explain, the evidence given by the complainant's mother in 2007 could have affected the jury's assessment of the reliability of the complainant. Particularly due to the natural limitations of appellate review where issues of credibility are involved, it was not inevitable that the jury, acting reasonably, would have convicted without the misdirection. The appeal should be allowed and orders made as proposed in the joint judgment. 36 Weiss v The Queen (2005) 224 CLR 300 at 317 [43]. 37 Libke v The Queen (2007) 230 CLR 559 at 581-582 [52]-[53]; [2007] HCA 30. 38 See also Kalbasi v Western Australia (2018) 92 ALJR 305 at 312 [14]; 352 ALR 1
HIGH COURT OF AUSTRALIA IN THE MATTER OF QUESTIONS REFERRED TO THE COURT OF DISPUTED RETURNS PURSUANT TO SECTION 376 OF THE COMMONWEALTH ELECTORAL ACT 1918 (CTH) CONCERNING [2018] HCA 10 Date of Order: 13 February 2018 Date of Publication of Reasons: 21 March 2018 ORDER The questions reserved for the consideration of the Full Court under s 18 of the Judiciary Act 1903 (Cth) be answered as follows: Question (1) Should the vacancy in the representation of South Australia in the Senate for the place for which Skye Kakoschke-Moore was returned on 4 August 2016 be filled by a special count of the votes cast at the poll on 2 July 2016 or by some other, and if so what, method? Answer The vacancy in the representation of South Australia in the Senate for the place for which Skye Kakoschke-Moore was returned on 4 August 2016 should be filled by a special count of the votes cast at the poll on 2 July Question (2) Notwithstanding that as at 2 July 2016 and until on or about 6 December 2017 Skye Kakoschke-Moore was a British citizen, and, therefore, incapable of being chosen as a senator, does the fact that she renounced her British citizenship with effect from on or about 6 December 2017 render her capable of now being chosen to fill the vacancy by means of a special count of the votes cast on 2 July 2016? Answer The fact that Skye Kakoschke-Moore renounced her British citizenship with effect from 6 December 2017 does not render her capable of now being chosen to fill that vacancy. Question (3) If the vacancy is to be filled by a special count of the votes cast on 2 July 2016, should Timothy Storer be excluded from the special count by reason that, whereas at the time of the poll on 2 July 2016 he stood for election in a group of candidates that was accepted by the Australian Electoral Officer on behalf of the Nick Xenophon Team party, he ceased to be a member of that party on or by 6 November 2017? Answer Timothy Storer should not be excluded from the special count. Representation D F Jackson QC with A L Tokley SC and A K Flecknoe-Brown appearing on behalf of Ms Kakoschke-Moore (instructed by Nick Xenophon & Co Lawyers) S P Donaghue QC, Solicitor-General of the Commonwealth with Z E Maud, M P Costello and J D Watson appearing on behalf of the Attorney-General of (instructed by Australian Government Solicitor) the Commonwealth M L Abbott QC with D Agresta appearing on behalf of Mr Storer (instructed by Illes Selley Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS in order of NXT Constitutional law (Cth) – Parliamentary elections – Reference to Court of Disputed Returns – Where Ms Skye Kakoschke-Moore and Mr Timothy Storer nominated for election as senator for State of South Australia as nominees of Nick Xenophon Team ("NXT") – Where Ms Kakoschke-Moore listed as third of four candidates, before Mr Storer – Where Ms Kakoschke-Moore returned as elected – Where Ms Kakoschke-Moore was time of nomination – Where Ms Kakoschke-Moore British citizen at subsequently renounced British citizenship – Where Mr Storer ceased to be member of NXT – Where Ms Kakoschke-Moore held incapable of being chosen or of sitting by reason of s 44(i) of Constitution – Whether vacancy in Senate should be filled by declaring Ms Kakoschke-Moore as elected – Whether Ms Kakoschke-Moore should be included in special count – Whether Mr Storer should be excluded from special count. Words and phrases – "above the line", "electoral choice", "electoral process", "incapable of being chosen or of sitting", "political party", "process of being chosen", "special count", "true legal intent of the voters". Constitution, ss 15, 44. Commonwealth Electoral Act 1918 (Cth), ss 162, 166, 168, 169, 181(2), 239, KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ. Ms Skye Kakoschke-Moore was a British citizen when she nominated as a candidate to be elected as a senator for the State of South Australia at the general election held on 2 July 2016 following the dissolution of both houses of Parliament on 9 May of that year. Ms Kakoschke-Moore stood for election as a nominee of the political party known as the Nick Xenophon Team ("NXT"), a political party registered under the Commonwealth Electoral Act 1918 (Cth) ("the Act"). On 4 August 2016, she was returned as elected as a senator for South Australia. On 27 November 2017, the Senate resolved, pursuant to s 376 of the Act, to refer to this Court, sitting as the Court of Disputed Returns, the question whether, by reason of s 44(i) of the Constitution (which renders a subject or a citizen of a foreign power incapable of being chosen or of sitting as a senator), there was a vacancy in the representation of South Australia in the Senate for the place for which Ms Kakoschke-Moore was returned. The Senate also resolved to refer to this Court ancillary questions, including one as to how any such vacancy should be filled. On 6 December 2017, Ms Kakoschke-Moore's renunciation of her British citizenship became effective. On 24 January 2018, Ms Kakoschke-Moore was declared by Nettle J to be incapable of being chosen or of sitting by reason of s 44(i) of the Constitution. As a result, three further issues were raised by questions reserved by Nettle J for the consideration of the Full Court pursuant to s 18 of the Judiciary Act 1903 (Cth). Those questions were in the following terms: Should the vacancy in the representation of South Australia in the Senate for the place for which Skye Kakoschke-Moore was returned on 4 August 2016 be filled by a special count of the votes cast at the poll on 2 July 2016 or by some other, and if so what, method? (2) Notwithstanding that as at 2 July 2016 and until on or about 6 December 2017 Skye Kakoschke-Moore was a British citizen, and, therefore, incapable of being chosen as a senator, does the fact that she renounced her British citizenship with effect from on or about 6 December 2017 render her capable of now being chosen to fill the vacancy by means of a special count of the votes cast on 2 July 2016? Bell Nettle Gordon Edelman If the vacancy is to be filled by a special count of the votes cast on 2 July 2016, should Timothy Storer be excluded from the special count by reason that, whereas at the time of the poll on 2 July 2016 he stood for election in a group of candidates that was accepted by the Australian Electoral Officer on behalf of the Nick Xenophon Team party, he ceased to be a member of that party on or by 6 November 2017? After the hearing on 13 February 2018, the Court decided unanimously that these questions should be answered as follows: The vacancy in the representation of South Australia in the Senate for the place for which Skye Kakoschke-Moore was returned on 4 August 2016 should be filled by a special count of the votes cast at the poll on 2 July The fact that Skye Kakoschke-Moore renounced her British citizenship with effect from 6 December 2017 does not render her capable of now being chosen to fill that vacancy. Timothy Storer should not be excluded from the special count. The Court stated that its reasons for these answers would be given at a later time. What follows are those reasons. Factual background In the group nomination form lodged with the Australian Electoral Commission on behalf of NXT the general election, Ms Kakoschke-Moore was listed as the third of four in the order of candidates, after Mr Nick Xenophon and Mr Stirling Griff and before Mr Storer. The order in which the candidates were listed determined the receipt of preferences for "above the line" votes because the order of voters' preference is taken to be the order in which the candidates are listed1. in relation On 3 November 2017, the management committee of NXT resolved to expel Mr Storer from the party. On 6 November 2017, Mr Storer purported to 1 Commonwealth Electoral Act 1918 (Cth), s 272(2). Bell Nettle Gordon Edelman resign from NXT. Thus, by at least the latter date, Mr Storer had ceased to be a member of NXT. On 22 November 2017, Ms Kakoschke-Moore resigned her position as senator for the State of South Australia. She did so after receiving confirmation from the United Kingdom Home Office and legal advice that she was a British citizen. On 30 November 2017, she submitted a form seeking to renounce her British citizenship. On 6 December 2017, she received confirmation from the Home Office that her renunciation of British citizenship became effective on that date. On 7 December 2017, the Attorney-General of the Commonwealth filed a summons seeking declarations that there is a vacancy by reason of s 44(i) of the Constitution in the representation of South Australia in the Senate for the place for which Ms Kakoschke-Moore was returned, and that that vacancy should be filled by a for Ms Kakoschke-Moore and Mr Robert Day AO2 to be counted to the candidate next in order of the voter's preference. The effect of such an order would be that, in the special count, the votes cast above the line for NXT that would have been counted in favour of Ms Kakoschke-Moore would be counted in favour of Mr Storer instead. the ballot papers, with votes special count of On 8 December 2017, Nettle J ordered that Ms Kakoschke-Moore, Mr Storer and the Attorney-General of the Commonwealth be allowed to be heard and be deemed to be parties. It is convenient now to summarise the submissions made on behalf of Ms Kakoschke-Moore in relation to each of the questions reserved for this Court's consideration. Question (1) Ms Kakoschke-Moore submitted that the vacancy in the representation of South Australia in the Senate for the place for which she was returned on 4 August 2016 should be filled, not by a special count, but by this Court 2 See Re Day (No 2) (2017) 91 ALJR 518; 343 ALR 181; [2017] HCA 14. Bell Nettle Gordon Edelman declaring her to be elected pursuant to s 360(1)(vi) of the Act. If that submission were accepted, it would render answers to Questions (2) and (3) unnecessary. Section 360(1)(vi) of the Act provides that the Court of Disputed Returns may "declare any candidate duly elected who was not returned as elected". There is an obvious difficulty in the way of accepting that this provision is available in this case, in that Ms Kakoschke-Moore was, in fact, returned as elected. That difficulty may be put to one side, however, because Ms Kakoschke-Moore's submission faces a more fundamental difficulty. Ms Kakoschke-Moore argued that while s 44(i) had the effect that she was "incapable of being chosen or of sitting" at the time of the election, she was not barred from now being returned as elected. It was said that because she has now renounced her British citizenship, she is no longer incapable of being chosen. It was argued that disqualification by reason of s 44(i) is not permanent, and that its effect is spent once the disability is overcome. As will be explained, this submission misconceives the effect of disqualification under s 44. Ms Kakoschke-Moore is now eligible to stand for election in the future; but the removal of her disqualification does not operate retrospectively to deem her to have been eligible to be chosen as a senator at the election on 2 July 2016. Question (2) Alternatively, Ms Kakoschke-Moore submitted that, if a special count is to be ordered, then, as a person who is no longer disqualified from being chosen as special count. Ms Kakoschke-Moore argued that, if it were necessary to answer Question (2), it should be answered "Yes". should not be excluded senator, from she the It was said that, so long as a candidate for election is not incapable of being chosen at the time the special count is ordered, it is immaterial that he or she was incapable of being chosen at some earlier point in time, and that this approach would best give effect to the true intention of the voters. Bell Nettle Gordon Edelman Ms Kakoschke-Moore argued that this Court's decision in Re Nash (No 2)3 is not decisive against her submission. It was said that in Re Nash (No 2) the Court did not need to consider whether s 44 had the effect of disqualifying a person who engaged one of its limbs at some time between nominating as a candidate for the general election and the order for a special count following the election from being included in the special count. It was argued that, in contrast to this Court's decision in Re Nash (No 2), a special count has not yet been ordered in this matter and that, if one were now ordered, Ms Kakoschke-Moore could be included in that count as she is no longer a citizen of the United Kingdom. Ms Kakoschke-Moore also argued that, to the extent that Re Nash (No 2) precluded acceptance of her submission, it should be overruled as a decision that proceeded upon a view of the relevant constitutional provisions which was unsound and which had not been worked out in a succession of earlier decisions. As will be explained, this submission too is misconceived. A special count is not a poll of the voters separate from the poll of 2 July 2016; it is only a means of determining the legal effect of that poll. Put differently, the "true legal intent of the voters" of which the Court spoke in In re Wood4 was the true legal intent expressed at the poll held on 2 July 2016. It was Ms Kakoschke-Moore's ineligibility as a candidate in that poll which denied legal effect to the votes cast for her. Question (3) Ms Kakoschke-Moore argued that Question (3) should be answered "Yes" so that Mr Storer would be excluded from the special count. This result, Ms Kakoschke-Moore contended, would reflect the practical reality that voting for the Senate took place along party lines and the exclusion of Mr Storer from the special count would give effect to the voters' intentions, which could be taken to require that Ms Kakoschke-Moore be replaced by someone of the same political party. (2017) 92 ALJR 23; 350 ALR 204; [2017] HCA 52. (1988) 167 CLR 145 at 166; [1988] HCA 22. Bell Nettle Gordon Edelman It was argued that the special count process should reflect the voters' true legal intentions in a manner that reflected the values of the Constitution and the Act5. In that regard, the importance of party representation was said to be reflected in the Act, through its provision for voters to vote above the line to indicate a preference for a set of candidates nominated by a particular political party. It was argued that the allocation of above the line votes for NXT to Mr Storer, who was no longer a member of the same political party as Ms Kakoschke-Moore, would distort the voters' intentions. In order to avoid that distortion, those votes should instead be allocated to a person who is both qualified and a member of NXT. Including Mr Storer in the special count would be contrary to the voters' intentions, a significant aspect of which was the choice of a political party (by way of above the line voting) rather than a specific candidate. Ms Kakoschke-Moore said that a special count resulting in the declaration of Mr Storer as a senator would distort the voters' intention, which was to vote for NXT. It was said that the appropriate course is to include in the special count only those candidates who are both qualified to be chosen and still members of the political party for whose candidates the voters had expressed their preferences. This aspect of Ms Kakoschke-Moore's argument fails to explain the basis upon which this Court could exclude from the special count a candidate at the election who was duly nominated and was at all times eligible to be chosen. In addition, her argument fails to recognise that the ascertainment of the true legal intention of the voters can proceed only in accordance with the Act. Ms Kakoschke-Moore also sought to rely, by analogy, upon s 15 of the Constitution, as amended in 1977, which has the effect that casual vacancies in the Senate are to be filled by a person of the same political party as the departing senator. As will be explained, that argument is without substance. Eligibility to be chosen Ms Kakoschke-Moore's approach to the determination of Questions (1) and (2). fundamental misunderstanding root lies the 5 Citing In re Wood (1988) 167 CLR 145 at 165-166. Bell Nettle Gordon Edelman Her arguments in relation to these questions fail to appreciate that because she was incapable of being chosen at the election held on 2 July 2016, she is incapable of being chosen by the special count, the purpose of which is to complete that electoral process6. In Re Nash (No 2)7, this Court held that the process of "being chosen" to which s 44 refers is a process of electoral choice that commences at the date of nomination and continues until the completion of the legislated processes for election that facilitate the choice by the people that the Constitution requires. In that case, Kiefel CJ, Bell, Gageler, Keane and Edelman JJ explained8: "[I]t is the Act which 'establishes the structure by which the choice by the people is to be made'9. The legislated processes which, under the Act, facilitate and translate electoral choice in order to determine who is or is not chosen by the people as a senator or member do not end with polling. They critically include the scrutiny for which Pt XVIII of the Act elaborately provides. … The processes of choice which the Parliament has prescribed in the Act for the purposes of ss 7 and 24 of the Constitution continue until a candidate is determined in accordance with those processes to have been chosen. They are brought to an end only with the declaration of the result 6 Re Culleton (No 2) (2017) 91 ALJR 311 at 319 [39]-[44], 324 [67]; 341 ALR 1 at 10-11, 17; [2017] HCA 4; Re Day (No 2) (2017) 91 ALJR 518 at 532 [77]-[80], 534-535 [93], 549-550 [206]-[211], 561 [293]; 343 ALR 181 at 197-198, 201, 221-222, 237; Re Canavan (2017) 91 ALJR 1209 at 1232 [138]; 349 ALR 534 at 564; [2017] HCA 45. (2017) 92 ALJR 23 esp at 29 [33]; 350 ALR 204 at 212. (2017) 92 ALJR 23 at 30 [36]-[38]; 350 ALR 204 at 212-213. 9 Murphy v Electoral Commissioner (2016) 90 ALJR 1027 at 1052 [119]; 334 ALR 369 at 400; [2016] HCA 36. Bell Nettle Gordon Edelman of the election and of the names of the candidates elected, after which certification of those names and return of the writ is a formality10." The process of choice involved in the election of 2 July 2016, so far as is presently relevant, remains incomplete until the vacancy in the Senate for South Australia which arose on the dissolution of the Senate on 9 May 2016 pursuant to s 57 of the Constitution is filled by the determination that a person who is eligible to be chosen has been elected. Ms Kakoschke-Moore, who was a citizen of a foreign power from the beginning of and during most of this process, is not now able to be included in the special count for the purpose of completing is an essential part11. the electoral process, of which nomination Ms Kakoschke-Moore was not eligible to be chosen as a senator at that time; and her candidacy thereafter was without legal effect. A special count is part of the electoral process; it is not some separate, new electoral process by which a new choice is to be made. In Re Nash (No 2), Kiefel CJ, Bell, Gageler, Keane and Edelman JJ explained that12: "[the] legislated processes which facilitate and translate electoral choice remain constitutionally incomplete until such time as they result in the determination as elected of a person who is qualified to be chosen and not disqualified from being chosen as a senator or member of the House of Representatives." The reference from the Senate to this Court under s 376 of the Act does not mean that this Court is engaged in now making the kind of choice that the Constitution and the Act require to be made by the people. The task of this Court that Ms Kakoschke-Moore's candidacy was legally ineffective. legally effective choice of the people, given to ascertain the A special count may be contrasted with the holding of a by-election. A by-election involves the casting of new votes following a new nomination as 10 Murphy v Electoral Commissioner (2016) 90 ALJR 1027 at 1059 [183]; 334 ALR 11 Sykes v Cleary (1992) 176 CLR 77 at 100; [1992] HCA 60. 12 (2017) 92 ALJR 23 at 30 [39]; 350 ALR 204 at 213. Bell Nettle Gordon Edelman part of a new electoral process. For that reason, a candidate who had previously been disqualified by reason of s 44 could participate in a by-election provided that he or she had removed the disqualifying attribute by the time the new process of being chosen had commenced. This case is not distinguishable from Re Nash (No 2). In that case, Ms Hughes was appointed to an office of profit under the Crown after Ms Nash was returned as an elected senator for New South Wales at the 2 July 2016 election. The process of choice at the election remained incomplete because the return of Ms Nash was disputed and, in due course, Ms Nash was held to have been ineligible to be chosen as a senator. Ms Hughes resigned her office of profit shortly after the Court ordered that there be a special count to fill the place for which Ms Nash was returned13. Ms Hughes' ineligibility to be chosen upon the special count arose because her appointment occurred during the period when the electoral process to fill the vacancy was incomplete. This Court's decision did not turn on Ms Hughes' failure to resign her office of profit under the Crown prior to the making of the order requiring the special count. Rather, it turned upon her having become incapable of being chosen to fill the vacancy in the course of the incomplete process to fill that vacancy by the poll of 2 July 201614. The argument for Ms Kakoschke-Moore would have it that the electoral process associated with the poll of 2 July 2016 was complete with the return of Ms Nash as elected. But that return was legally ineffective because Ms Nash's candidacy was legally ineffective. The vacancy in the Senate which arose on 9 May 2016 as a result of the dissolution of both houses of Parliament was not filled by the return of Ms Nash. A new vacancy did not arise when Ms Nash was declared incapable of being chosen. The true position was that the vacancy had not been filled because the 2 July 2016 election to fill that vacancy had not been completed by the return of a candidate capable of being chosen. 13 (2017) 92 ALJR 23 at 26 [8]; 350 ALR 204 at 206-207. 14 (2017) 92 ALJR 23 at 30-31 [38]-[44]; 350 ALR 204 at 213-214. Bell Nettle Gordon Edelman This Court's decision in Re Nash (No 2) applied the view, expressed earlier in Vardon v O'Loghlin15, In re Wood16 and Sykes v Cleary17, that the process of choice mandated by the Constitution and prescribed by the Act begins with nomination18 and is not concluded until only candidates capable of being chosen are returned as elected. There is no basis for the argument that this Court should overrule Re Nash (No 2). Leave to re-open Re Nash (No 2) should be refused. May Mr Storer be included in the special count? The purpose of a special count is to identify "the true legal intent of the voters"19 at the general election. The true legal intent of the voters is no more or less than what is apparent from the valid ballots having regard to the relevant provisions of the Act20. In In re Wood21, Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey "The purpose of the poll is to choose in accordance with the Act the preferred candidates who are qualified to be chosen, but no effect can be given for the purpose of the poll to the placing of a figure against the name of a candidate who is not qualified to be chosen: an indication of a voter's preference for an unqualified candidate is a nullity. … The vote is 15 (1907) 5 CLR 201 at 208-209, 213-214; [1907] HCA 69. 16 (1988) 167 CLR 145 at 164. 17 (1992) 176 CLR 77 at 100-101, 108, 130-131. 18 Free v Kelly (1996) 185 CLR 296 at 301; [1996] HCA 42. 19 In re Wood (1988) 167 CLR 145 at 166. 20 Re Day (No 2) (2017) 91 ALJR 518 at 549-550 [209]-[211], 561-563 [298]-[306]; 343 ALR 181 at 221-222, 237-239. 21 (1988) 167 CLR 145 at 165-166. Bell Nettle Gordon Edelman valid except to the extent that the want of qualification makes the particular indication of preference a nullity." The sections of the Act that provide for the nomination of candidates for election to the Senate and the House of Representatives by political parties22 and for voting for candidates by marking the ballot by reference to the political parties that have nominated them23 facilitate the choice of candidates. An above the line vote is the expression of a preference for each person within the relevant group of candidates (usually, though not always, comprising the members of a registered political party24), in the order in which their names appear on the ballot paper25. These provisions of the Act do not require that each individual endorsed by a party must maintain his or her affiliation with that party in order to be duly elected. In particular, s 272(2)(b) of the Act provides that each ballot paper of a voter who has voted above the line is taken to have been marked as if each candidate in a preferenced group was placed in an order of preference consecutively, from the candidate whose name on the ballot paper is at the top of the group to the candidate whose name is at the bottom. This provision cannot be read as if it were qualified by the need somehow to ensure that each grouped candidate would remain in the group. Indeed, the Act contains no machinery whereby the maintenance of that relationship might be policed and enforced. The maintenance of that relationship is left by the Act as a matter between the candidate and the party. Under the Act, the circumstance that a nominated candidate ceases to be a member of the party that endorsed him or her has no consequence for the validity of the ballots cast in his or her favour. Nothing in the Constitution or the Act requires that a person qualified to be elected and duly elected must remain affiliated with the party that endorsed him or her before the completion of the 22 Commonwealth Electoral Act 1918 (Cth), ss 162, 166. 23 Commonwealth Electoral Act 1918 (Cth), ss 239, 269, 272. 24 Commonwealth Electoral Act 1918 (Cth), ss 168, 169(1), 169(4). 25 Commonwealth Electoral Act 1918 (Cth), s 272(2). Bell Nettle Gordon Edelman election, just as there is no requirement that the affiliation must be maintained during the term of the Parliament for which he or she was elected. Those voters who cast their votes above the line for NXT on 2 July 2016 must be taken to have intended that their votes should, if sufficient, elect Mr Storer: that is the effect of the Act. The circumstance that Mr Storer and NXT subsequently fell out with each other has nothing to do with the intention which informed the votes cast at the poll on 2 July 2016. Mr Storer's subsequent expulsion or resignation from NXT could not alter the voters' expression of intention at the poll that he should be elected should their evident preference for Ms Kakoschke-Moore not be capable of being given legal effect. Indeed, if Mr Storer had resigned from NXT before the declaration of the poll, his dissociation from NXT would not have resulted in the election failing within the meaning of s 181(2) of the Act, and, therefore, he would still have been entitled to be duly elected as a candidate who had been duly nominated and was at all times eligible to be chosen as a senator. For those reasons, it is necessary that Mr Storer be included in the special count in order to ensure that it achieves the true legal effect of the voters. Finally, it should be said that s 15 of the Constitution does not assist Ms Kakoschke-Moore's approach to the determination of Question (3), even by analogy. Section 15 provides that where a vacancy has occurred in the place of a senator chosen by the people of a State who was endorsed by a political party at the time he or she was chosen, that senator shall be replaced by a member of that party. If a person so chosen ceases to be a member of that political party before taking his or her seat, he or she shall be deemed not to have been so chosen or appointed and the vacancy shall again be notified. It is readily apparent that s 15 of the Constitution operates only in the case of a senator who has been validly elected in the first place. Section 15 prescribes a process for the filling of a casual vacancy in the Senate in respect of a duly elected senator. That process is entirely different from the completion of the electoral process, with which the present case is concerned. In contrast to such a case, the present reference is concerned with a case where a senator returned as elected was not capable of being chosen and so was not legally chosen at all. In such a case, the filling of the vacancy by reference to the legally effective choice of the people may well lead to the return of a person from a political party different from that of the ineligible candidate.
HIGH COURT OF AUSTRALIA AND THE QUEEN APPELLANT RESPONDENT [2018] HCA 28 20 June 2018 ORDER Appeal allowed. Set aside order 4 of the Court of Criminal Appeal of the Supreme Court of New South Wales dated 22 March 2017 and in lieu thereof order that: the appellant's appeal to that Court be allowed; the appellant's conviction and sentence be quashed; and a new trial be had. On appeal from the Supreme Court of New South Wales Representation S J Buchen with G E L Huxley for the appellant (instructed by Legal Aid NSW) W J Abraham QC with H R Roberts for the respondent (instructed by Solicitor for Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Appeal against conviction – Application of proviso – Where appellant convicted of manslaughter – Where either of two acts of appellant may have caused death of deceased – Where trial judge erred in failing to direct jury as to requirement that it be unanimous as to specific act causing death – Whether "no substantial miscarriage of justice has actually occurred" – Whether absence of unanimity direction precluded application of proviso. Words and phrases – "fundamental defect", "nature and effect of the error", "presuppositions of the trial", "proviso", "reasonable doubt", "substantial miscarriage of justice", "unanimity direction", "unanimous". Criminal Appeal Act 1912 (NSW), s 6(1). KIEFEL CJ, BELL, KEANE AND EDELMAN JJ. At the appellant's trial for murder, the Crown relied on two physical interactions between the appellant and the deceased, each of which was alleged to have involved a blow by the appellant capable of having caused the death of the deceased. The appellant was acquitted of murder but convicted of manslaughter. The Court of Criminal Appeal of the Supreme Court of New South Wales held that the trial judge erred in failing to direct the jury that it must be unanimous as to which actions on the part of the appellant caused the death of the deceased. Nevertheless, the Court of Criminal Appeal, by majority, dismissed the appeal on the basis that no substantial miscarriage of justice had actually occurred, as the jury could not have been satisfied beyond reasonable doubt that the first action of the appellant caused the death and it was not open to the jury to entertain a reasonable doubt of the appellant's guilt of manslaughter by the evidence of the second interaction. The issue in the appeal to this Court is whether the Court of Criminal Appeal erred in concluding that no substantial miscarriage of justice actually occurred by reason of the failure of the trial judge to give the necessary unanimity direction. The appeal to this Court must be allowed. The proviso to the common form criminal appeal provision in s 6(1) of the Criminal Appeal Act 1912 (NSW), which authorises the Court of Criminal Appeal to dismiss an appeal against conviction if it considers that no substantial miscarriage of justice has actually occurred, could not be applied to cure the uncertainty as to whether the jury's verdict in this case was unanimous that resulted from the trial judge's failure to give the specific unanimity direction that was required. The trial The appellant was arraigned on an indictment in the Supreme Court of New South Wales charging him with the murder of the deceased, Peter Morris. The offence with which he was charged was alleged to have occurred late on the evening of 15 September 2012. The appellant pleaded not guilty. The evidence of the incident The appellant and the deceased had been drinking at the Commercial Hotel in Casino. Each was in his mid-50s, intoxicated to some degree, and Bell Edelman previously unknown to the other. Each left the hotel with a companion, the deceased with Mr Schwager and the appellant with his son1. After the men left the hotel, there was an altercation between them occurring on the footpath and roadway outside a dental surgery near the hotel. Much of the altercation was captured by a CCTV security camera located nearby2. The CCTV footage captured four events. In the first, the deceased turned the appellant around and forced him against the shopfront of the dental surgery. In the second, the deceased retreated towards the roadway with the appellant in pursuit. The deceased fell backwards on the roadway and struck his head ("the first fall"). In the third, Mr Schwager approached the appellant, who then punched Mr Schwager, causing him to fall to the ground near a telegraph pole. In the meantime, the deceased had risen to his feet and faced the appellant. In the fourth, the deceased could be seen to fall to the road a second time ("the second fall"). At that point he lost consciousness3. He died while in care at the Southport Hospital nine days later4. The CCTV footage did not clearly depict the appellant punching the deceased before either fall. Although the CCTV footage did not show an actual striking of the deceased by the appellant, the CCTV footage was capable of sustaining a finding that the appellant delivered a powerful punch to the head of the deceased, causing him to fall and strike his head on the ground the second time. A number of witnesses gave evidence about these interactions. Each was, to some extent, intoxicated. Each gave a somewhat different account of what he or she saw and heard. Mr Perkins testified that his attention was first drawn by "a noise like of someone being hit". He turned around and the first thing he saw was a person getting hit and landing on the street. He could not recall where the hit landed, which hand was used, or whether he saw the person actually fall. He saw the 1 Lane v The Queen [2017] NSWCCA 46 at [6]. 2 Lane v The Queen [2017] NSWCCA 46 at [7]. 3 Lane v The Queen [2017] NSWCCA 46 at [51]-[52]. 4 Lane v The Queen [2017] NSWCCA 46 at [8]. Bell Edelman appellant punch another man in the face, who fell backwards against the telegraph pole, albeit he could not remember if that occurred before or after the other punch. Mr Armstrong was in the company of Mr Perkins. Mr Armstrong said that he saw the deceased and another man (who must have been Mr Schwager) sitting on the gutter. As the two men were starting to stand, Mr Armstrong claimed, he saw the appellant punch the deceased. He could not recall where the punch landed, and, under cross-examination, could not remember whether the deceased fell on this occasion. He then saw the appellant punch Mr Schwager's right cheek, and thought Mr Schwager went to the ground. Although his view was obstructed, he then heard sounds consistent with the appellant punching the deceased and the deceased hitting his head. The deceased fell to the ground. The trial judge told the jury that the CCTV footage was "directly contradictory" of how Mr Armstrong described the events. The trial judge told the jury that "the only punch [Mr Armstrong] clearly describes is one on Mr Schwager." Of the other witnesses, Mr Cupitt and Ms Livingstone said that they saw the appellant punch the deceased. Mr Marsh saw the appellant swing his arm at the deceased and then saw the deceased fall backwards and hit his head on the roadway, but he did not see the punch connect5. The Crown case The Crown opened its case on the basis that it was a blow by the appellant to the head of the deceased that led to the second fall, and that it was that fall that In the course of the trial, the Crown called a forensic pathologist, Dr Little, who had conducted an autopsy on the deceased. Dr Little gave evidence of the following injuries found on an examination of the head of the deceased: (a) An abrasion on the back of the scalp, five centimetres to the left of the midline, measuring 35 millimetres high by 25 millimetres wide. There was no bruising in this area nor any fracture of the skull. Dr Little said 5 Lane v The Queen [2017] NSWCCA 46 at [53]. 6 Lane v The Queen [2017] NSWCCA 46 at [115]. Bell Edelman that this injury was typical of what "we would see in someone who falls backwards". (b) A very large area of bruising across the left side of the scalp beginning in the area of the temple and extending 140 millimetres back toward the back of the scalp and 80 millimetres in height. Under this area of bruising was a horizontal fracture through the bone above the ear extending to adjacent bones of the skull at the back and the front. The total length of this fracture on the outside of the skull was 80 millimetres. The fracture penetrated through the full thickness of the skull. On the inside it went across the base of the skull almost to the midline of the front, then extended through the bone above the top of the nose. (c) A fracture of the left cheekbone below the eye approximately seven millimetres long, projecting horizontally through the bone, and a fracture of the left upper jaw bone. There was a yellow bruise at the outer corner of the left eye 15 millimetres in diameter. Bruising on the inside lining of the mouth at the right corner. Bruising on the frontal and temporal lobes of the brain. There was diffuse cerebral swelling which indicated that intracranial pressure had been raised. Evidence of subdural haemorrhage further indicated intracranial pressure. This pressure had caused both haemorrhaging and ischaemia within the brain7. Dr Little could not relate the temporal sequence of these injuries to the two falls. Dr Little said: "I think – overall obviously it's a combination but … either injury could have led to death on its own." After Dr Little gave her evidence, the case for the Crown changed. In the course of the Crown's final address, it was put to the jury that the actions of the appellant before each fall could found his liability for murder or manslaughter8. It was said in relation to the first fall by reference to the CCTV footage that there was a "blow" from the appellant. In relation to the second fall it was said that the CCTV footage and the eyewitness accounts established that the appellant landed a punch that caused the deceased to fall again9. The trial judge directed the jury 7 Lane v The Queen [2017] NSWCCA 46 at [122]. 8 Lane v The Queen [2017] NSWCCA 46 at [41], [125]. 9 Lane v The Queen [2017] NSWCCA 46 at [30]. Bell Edelman that it was open to it to find that a deliberate act by the appellant had caused the death of the deceased if it found that either fall was caused by the appellant10. By the conclusion of the trial it was accepted by both sides that each of the falls suffered by the deceased was sufficient to have caused his death11. Although the Crown had altered its case in response to the evidence of Dr Little that either fall could have been fatal to the deceased, the appellant did not seek to take advantage of the shift in the Crown case by raising an issue to the effect that any blow by the appellant that might have led to the second fall was not a sufficient cause of or contribution to the death of the deceased because he had suffered a fatal injury by reason of the first fall for which the appellant was not responsible, so that the second fall was not a legally sufficient cause of or contribution to the death. As noted earlier, the jury returned a verdict of not guilty of murder, but guilty of manslaughter. The appellant was sentenced to a term of imprisonment with a non-parole period of six years and four months commencing 27 September 2013, with an additional two years and two months expiring on 26 March 2022. Court of Criminal Appeal The appellant appealed against his conviction on several grounds. Only one ground of appeal is now relevant. It was that: "The trial judge erred in failing to direct the jury that in their consideration of the charge of manslaughter they were to be unanimous in their deliberations as to the factual basis on which they might convict [the appellant] of manslaughter". All three members of the Court of Criminal Appeal accepted that this ground of appeal was made out12. The majority (Meagher JA and Davies J) held that "the jury could not convict of murder or manslaughter unless they were agreed as to whether one or 10 Lane v The Queen [2017] NSWCCA 46 at [37]. 11 Lane v The Queen [2017] NSWCCA 46 at [8]. 12 Lane v The Queen [2017] NSWCCA 46 at [44], [108]. Bell Edelman both of [the acts said to cause the deceased to fall] was a criminal act of the appellant."13 Their Honours explained that14: "in the absence of any direction to that effect it remained possible that some jurors might reason to a verdict of guilty of murder or manslaughter by being satisfied that the appellant's voluntary act caused the first fall while others might reason to the same conclusion by reference to his voluntary act having caused the second fall." The majority accepted15 that the failure of the trial judge to give a unanimity direction: "raised at least as a theoretical possibility that some members of the jury might determine [the appellant's] guilt by reference to the first fall, and others by reason of his having caused the second. Where there were two separate allegedly criminal acts left to the jury, the appellant was entitled to have the jury determine unanimously whether he was guilty in relation to one or other or both of those acts." Under s 6(1) of the Criminal Appeal Act, the Court of Criminal Appeal is required to allow an appeal against conviction if the Court "is of opinion … that the judgment of the court of trial should be set aside on the ground of the wrong decision of any question of law", "provided that the court may … dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred." The majority applied the proviso, concluding that no substantial miscarriage of justice actually occurred16. The majority rejected the "theoretical possibility" which they had identified on the basis that it17: 13 Lane v The Queen [2017] NSWCCA 46 at [42]. 14 Lane v The Queen [2017] NSWCCA 46 at [43]. 15 Lane v The Queen [2017] NSWCCA 46 at [57]. 16 Lane v The Queen [2017] NSWCCA 46 at [61]. 17 Lane v The Queen [2017] NSWCCA 46 at [58]. Bell Edelman "did not give rise to any miscarriage in this case because the evidence was not capable of supporting a finding beyond reasonable doubt that a deliberate act of the appellant caused the first fall." The majority reasoned that "the jury necessarily should have entertained a doubt as to whether the deceased's first fall was caused by any voluntary act of the appellant."18 In that regard, their Honours said that the only evidence of that incident was "the CCTV footage and, perhaps, the evidence of Mr Armstrong"19, and their Honours' view was that the evidence of Mr Armstrong was "not at all consistent with the CCTV footage"20. In relation to the second fall, the majority concluded that21: "the CCTV footage, the evidence of the eyewitnesses … and the evidence of Dr Little … establishes beyond reasonable doubt that it was caused by a punch thrown by the appellant. We do not consider that it was open to the jury to have any reasonable doubt about that." Their Honours went on to say that they were also satisfied beyond reasonable doubt that the appellant's punch was dangerous, and that the appellant did not act in self-defence22. The majority concluded that23: "[t]he absence of any specific unanimity direction did not prevent the jury from considering the appellant's guilt on the basis that his deliberate act caused the deceased's second fall; and acting reasonably and properly they should have done so, having necessarily entertained a doubt about the appellant's guilt with respect to the first". 18 Lane v The Queen [2017] NSWCCA 46 at [50] (emphasis in original). 19 Lane v The Queen [2017] NSWCCA 46 at [50]. 20 Lane v The Queen [2017] NSWCCA 46 at [51]. 21 Lane v The Queen [2017] NSWCCA 46 at [52]. 22 Lane v The Queen [2017] NSWCCA 46 at [55]. 23 Lane v The Queen [2017] NSWCCA 46 at [60]. Bell Edelman The third member of the Court of Criminal Appeal, Fagan J, concluded that a substantial miscarriage of justice had actually occurred; his Honour would have allowed the appeal on the basis that the error as to the absence of a specific unanimity direction "denied the appellant a trial by jury according to law of the charge against him."24 That was so whether or not an appellate court might be satisfied of the appellant's guilt on its review of the evidence. The appellant was granted special leave to appeal to this Court to challenge the conclusion of the majority in relation to the application of the proviso. The appellant's submissions The appellant submitted that the absence of a specific unanimity direction at trial is, in the circumstances of the case, an error of a kind that precludes the application of the proviso, notwithstanding that an appellate court may itself be satisfied of the appellant's guilt. The appellant relied upon the view of Fagan J "It is difficult to conceive of a more serious error of [that] nature than one which resulted in the jury not having identified to them for their unanimous determination a factual question which was central to an element of the charge of murder and which the accused had put in issue." The appellant argued that, in the present case, the failure by the trial judge to give the necessary unanimity direction left open the possibility that "there was no unanimity among the jurors as to which act founded the guilty verdict and, therefore, that [the appellant] was not lawfully convicted."26 It was argued that the majority in the Court of Criminal Appeal, having acknowledged that the appellant was entitled to have the jury determine unanimously whether he was guilty by reason of his conduct in one or other or both of the interactions which allegedly caused the death of the deceased27, erred 24 Lane v The Queen [2017] NSWCCA 46 at [194]. 25 Lane v The Queen [2017] NSWCCA 46 at [175]. 26 R v Klamo (2008) 18 VR 644 at 662 [77]. See also Smith [1997] 1 Cr App R 14; Walsh (2002) 131 A Crim R 299. 27 Lane v The Queen [2017] NSWCCA 46 at [57]. Bell Edelman in acting upon their own view of the appellant's guilt when they had no basis for concluding that the jury was unanimous as to the basis of its verdict. This course was said to be beyond the scope of the proviso. The respondent's submissions The respondent submitted that the majority were correct to proceed on the footing that the failure of the trial judge to give the necessary unanimity direction was an error to which the proviso applied. It was said that the error in relation to the unanimity direction did not give rise to the possibility that the jury failed to perform its function of determining the appellant's guilt with respect to the alleged offence. The respondent argued that there was no basis in the evidence upon which the jury could have found, in relation to the interaction leading to the first fall, a voluntary act on the part of the appellant for the purposes of satisfying an element of the offence of manslaughter. The jury was directed by the trial judge in terms of a "strike"; the required "voluntary act" was limited to a strike. It was to be assumed, it was said, that the jury followed the directions given by the trial judge in this regard. The respondent contended that, there being no reliable evidence of a strike or a blow by the appellant in respect of the first fall, the Crown prosecutor's assertions that there was "a blow" and "an act or acts" in relation to the first fall were not apt to mislead the jury to reason to guilt. The nature and effect of the error at trial In Baiada Poultry Pty Ltd v The Queen28, French CJ, Gummow, Hayne and Crennan JJ said that while, as the Court held in Weiss v The Queen29, the proviso cannot be applied "unless the appellate court is persuaded that the evidence properly admitted at trial proved, beyond reasonable doubt, the accused's guilt of the offence on which the jury returned its verdict of guilty", this negative proposition "states a necessary but not sufficient condition for applying the proviso." The course of authority establishes that an error at trial may be such as to preclude the application of the proviso in the sense of precluding a conclusion that there was no substantial miscarriage of justice, irrespective of the appellate court's view as to whether the evidence properly 28 (2012) 246 CLR 92 at 104 [29]; [2012] HCA 14. 29 (2005) 224 CLR 300 at 317 [44]; [2005] HCA 81. Bell Edelman admitted at trial proved the appellant's guilt beyond reasonable doubt30. Put in a verbal formulation that amounts to the same assessment, some errors will establish a substantial miscarriage of justice even if the appellate court considers that conviction was inevitable. A misdirection by a trial judge always involves an error of law, but "sometimes [it] will prevent the application of the proviso; and sometimes it will not."31 It is necessary for the appellate court to consider the nature and effect of the error in every case32. At trial, the Crown put a case to the jury that the appellant's acts before the first fall supported liability for murder or manslaughter. It now submits that, because that case could not support a conviction, the proviso was properly applied. It must be said immediately that this is not an attractive argument. The likely effect upon the jury of the trial judge's failure to direct it that it must be unanimous in its conclusion as to the act of the appellant which caused the death of the deceased can only be understood in the context of the trial. That context included the Crown's reliance upon the appellant's conduct leading up to the first fall as a basis on which the jury might convict, and the circumstance that the trial judge left it open to the jury to find that the appellant's conduct leading up to that fall was a viable basis for a verdict of murder or manslaughter. Nor is it persuasive to argue, as the respondent does, that it may be assumed that the jury acted in accordance with the trial judge's directions to act upon the evidence and, in doing so, ignored the Crown's submissions. In deciding whether the trial process miscarried in a way that, without more, will 30 Nudd v The Queen (2006) 80 ALJR 614 at 617-618 [6]; 225 ALR 161 at 163; [2006] HCA 9; Evans v The Queen (2007) 235 CLR 521 at 552 [117]; [2007] HCA 59; AK v Western Australia (2008) 232 CLR 438 at 447-448 [23], 469 [87]; [2008] HCA 8; Cesan v The Queen (2008) 236 CLR 358 at 394 [124]; [2008] HCA 52; Baiada Poultry Pty Ltd v The Queen (2012) 246 CLR 92 at 102-103 [22]; Reeves v The Queen (2013) 88 ALJR 215 at 223-224 [50]; 304 ALR 251 at 261; [2013] HCA 57. 31 Kalbasi v Western Australia (2018) 92 ALJR 305 at 319 [57]; 352 ALR 1 at 18; [2018] HCA 7. See also Reeves v The Queen (2013) 88 ALJR 215 at 223-224 [50]-[51]; 304 ALR 251 at 261-262. 32 Kalbasi v Western Australia (2018) 92 ALJR 305 at 312 [15]; 352 ALR 1 at 8. See also Weiss v The Queen (2005) 224 CLR 300 at 317 [44]; AK v Western Australia (2008) 232 CLR 438 at 456 [55]. Bell Edelman result in a substantial miscarriage of justice, one cannot leap from the evidence to the verdict of the jury, ignoring the Crown's case and the directions of the trial judge. How the case is left to the jury is apt to have a critical bearing on the performance by the jury of its task; and as Gleeson CJ said in Doggett v The Queen33: "The manner in which a trial is conducted, and in which the issues are shaped, … has a major influence upon the way in which the case is ultimately left to the jury". It must be accepted, of course, as the respondent argues, that it is to be assumed that the jury followed the trial judge's directions34. But to say this is to accept the force of the appellant's submission. The absence of a specific unanimity direction in relation to the actus reus that caused the death of the deceased, coupled with the trial judge's direction that it was open to the jury to convict on the basis that a deliberate act of the appellant caused the death of the deceased if it found that either fall was caused by the appellant, means that it cannot be assumed that the jury was unanimous that it was the appellant's actions leading up to the second fall that established his guilt beyond reasonable doubt. As Fagan J said35, it is quite possible that some jurors might have been satisfied that a voluntary act of the appellant caused the first fall and did not trouble to consider the circumstances of the second. And the jurors who found the actus reus made out in respect of the second fall may have pooled their conclusions with those who found the actus reus made out in respect of the first fall to reach their verdict. For a juror to reason in that way would not be to depart from the directions the jury had been given. The possibility that some members of the jury might have concluded that the appellant's conduct leading up to the first fall established the appellant's guilt of manslaughter cannot be excluded by saying, as was said by the majority in the Court of Criminal Appeal, that the jury "necessarily should have entertained a doubt as to whether the deceased's first fall was caused by any voluntary act of the appellant."36 The case was left to the jury on the basis that it was open to it to 33 (2001) 208 CLR 343 at 346 [2]; [2001] HCA 46. 34 Gilbert v The Queen (2000) 201 CLR 414 at 420 [13], 425-426 [31]-[32], 431 [52]; [2000] HCA 15. 35 Lane v The Queen [2017] NSWCCA 46 at [154]. 36 Lane v The Queen [2017] NSWCCA 46 at [50] (emphasis in original). Bell Edelman convict the appellant by pooling individual jurors' conclusions of fact on issues in respect of which it was required to be unanimous. It was, as a matter of fact, distinctly possible that some of the jurors may have been disposed to convict on the basis only of the first fall. That is so regardless of whether an appellate court might conclude that the evidence in respect of the first fall was incapable of supporting a conviction. It is not permissible to speculate as to how the jury may have reasoned37. Nor would it have been open to the appellate court to hold that the jury should have reasoned by rejecting a basis then said by the Crown and the trial judge to be available to it. A breach of the presuppositions of the trial? To say it was not open to the jury to convict on a particular basis when the Crown invited the jury to do just that, and the trial judge allowed the case to go to the jury on the basis that it was open to it to do so, would impermissibly diminish the role of the jury as "the constitutional tribunal for deciding issues of fact."38 The appellant could not have been lawfully convicted by the jury unless it was agreed upon the action by the appellant that caused the deceased's fatal injury39. In the absence of a unanimity direction, the basis of the verdict is necessarily uncertain as to the act or acts of the appellant on which it was founded. The CCTV footage did not depict blows by the appellant connecting with the head of the deceased before either fall. An assessment of the reliability of the eyewitnesses was necessary. Further, there were live issues as to the dangerousness of the appellant's acts and as to self-defence raised in respect of the acts of the appellant leading up to the second fall40. As Fagan J recognised, the jury was not directed as to the different circumstances bearing upon these 37 Weiss v The Queen (2005) 224 CLR 300 at 314 [35]. 38 Hocking v Bell (1945) 71 CLR 430 at 440; [1945] HCA 16; R v Baden-Clay (2016) 258 CLR 308 at 329 [65]; [2016] HCA 35. 39 Walsh (2002) 131 A Crim R 299 at 316-317 [57]; Fermanis v Western Australia (2007) 33 WAR 434 at 454 [68]-[69], 456 [73]; Chapman v The Queen (2013) 232 A Crim R 500 at 505 [28]. 40 Lane v The Queen [2017] NSWCCA 46 at [134]. Bell Edelman issues that were relevant in relation to each of the potentially fatal interactions between the appellant and the deceased41. It has been said that "it is neither possible nor useful" to consider application of the proviso "by reference to some supposed category of 'fundamental defects' in a trial", as doing so distracts attention from the statutory requirement of considering whether there has been a "substantial miscarriage of justice" in the particular case42. While conclusionary labels such as "fundamental defect" may not be particularly useful as tools of analysis, to say that some errors at trial can be seen to breach the "presuppositions of the trial" so as to be beyond the reach of the proviso43 does serve to focus attention upon the effect of the error in question upon the trial in order to determine whether a substantial miscarriage of justice has actually occurred. Notwithstanding the inscrutability of the jury's verdict, because it must be assumed that the jury will act in accordance with the directions of the trial judge an appellate court would have been justified in concluding, if the required unanimity direction had been given, that the jurors had not impermissibly pooled their conclusions on the actus reus that led to the death of the deceased. The absence of the necessary direction means that it cannot be assumed that the jury discharged its function to reach a unanimous verdict as the tribunal of fact. A misdirection that is apt to prevent the performance by the jury of its function, without more, will result in a substantial miscarriage of justice44. The proviso is cast in terms which permit the appellate court to dismiss an appeal from a judgment of the court which gives effect to the verdict of the jury: the proviso does not permit the appellate court to exercise the function of the jury. The language of the proviso cannot be understood as if it were to the effect that an appeal in which the possibility that the jury has not performed its function of reaching a unanimous verdict may be dismissed on the basis that the appellate court is satisfied of the guilt of the accused. 41 Lane v The Queen [2017] NSWCCA 46 at [135], [142]. 42 Baiada Poultry Pty Ltd v The Queen (2012) 246 CLR 92 at 103 [23]. 43 Weiss v The Queen (2005) 224 CLR 300 at 317 [46]. 44 Wilde v The Queen (1988) 164 CLR 365 at 371-373; [1988] HCA 6; Krakouer v The Queen (1998) 194 CLR 202 at 226 [74]; [1998] HCA 43; Handlen v The Queen (2011) 245 CLR 282 at 298 [47]; [2011] HCA 51. Bell Edelman On the approach of the majority in the Court of Criminal Appeal, the effect of the absence of a specific unanimity direction to the jury was disregarded notwithstanding that it might well be that the jury did not reach a unanimous conclusion as to the necessary basis of the appellant's guilt. As Barwick CJ said in Ryan v The Queen45: "the choice of the act causing death is not for the presiding judge or for the Court of Criminal Appeal: it is essentially a matter for the jury under proper direction." To dismiss the appeal as the majority did is to disregard the requirement of a unanimous verdict on the part of the jury and to "substitute trial by an appeal court for trial by jury."46 Such an error is apt to deny the application of the proviso because it means that it cannot be said that no substantial miscarriage of Orders The appeal should be allowed. The order of the Court of Criminal Appeal dismissing the appellant's appeal against his conviction should be set aside, and in its place it should be ordered that the appeal to that Court be allowed and the appellant's conviction be quashed. There should be an order for a new trial. 45 (1967) 121 CLR 205 at 218; [1967] HCA 2. See also Royall v The Queen (1991) 172 CLR 378 at 386; [1991] HCA 27. 46 R v Baden-Clay (2016) 258 CLR 308 at 330 [66]. 47 Weiss v The Queen (2005) 224 CLR 300 at 317 [46]. See also Wilde v The Queen (1988) 164 CLR 365 at 373. This is yet another case in which application of the proviso to the common form criminal appeal statute has proven problematic. Where an appellate court concludes in an appeal against a conviction that the trial judge made a wrong decision on a question of law or that there was some other irregularity at the trial which was capable of characterisation as a miscarriage of justice, the question raised by the proviso is whether "no substantial miscarriage of justice has actually occurred". For the appellate court to conclude that no substantial miscarriage of justice "has actually occurred" is for the appellate court to conclude that, notwithstanding the error or other irregularity, no substantial miscarriage of justice "in fact" occurred48. And for the appellate court to conclude that "no substantial miscarriage of justice" in fact occurred is for the appellate court to conclude that the error or irregularity affected neither: (1) the outcome of the trial, such as to have denied the appellant "a chance of acquittal which was fairly open to him or her"; nor (2) the process of the trial, to an extent sufficient to warrant the conclusion that a substantial miscarriage of justice occurred without need of inquiry into its effect on the outcome of the trial49. Where, as here, the appeal is against a conviction entered on a verdict of guilty returned by a jury, the jury was at the trial and remains for the purpose of the application of the proviso the "constitutional tribunal for deciding issues of fact"50. Weiss v The Queen51, whatever else it might mean, cannot mean that the appellate court in applying the proviso is authorised to "substitute trial by judge Except where the appellate court concludes that the error or irregularity led to a failure of process so serious as to have amounted without more to a 48 Reeves v The Queen (2013) 88 ALJR 215 at 224 [51], 226 [63]-[65]; 304 ALR 251 at 262, 264-265; [2013] HCA 57. 49 Filippou v The Queen (2015) 256 CLR 47 at 55 [15]; [2015] HCA 29. See also Nudd v The Queen (2006) 80 ALJR 614 at 617-618 [3]-[6]; 225 ALR 161 at 162- 163; [2006] HCA 9; Wilde v The Queen (1988) 164 CLR 365 at 371-373; [1988] HCA 6. 50 Kalbasi v Western Australia (2018) 92 ALJR 305 at 320 [64]; 352 ALR 1 at 19; [2018] HCA 7, quoting Hocking v Bell (1945) 71 CLR 430 at 440; [1945] HCA 16. See also Wilde v The Queen (1988) 164 CLR 365 at 384. 51 (2005) 224 CLR 300; [2005] HCA 81. 52 Quartermaine v The Queen (1980) 143 CLR 595 at 601; [1980] HCA 29. See also R v Baden-Clay (2016) 258 CLR 308 at 330 [66]; [2016] HCA 35. substantial miscarriage of justice, "deciding whether there has been no substantial miscarriage of justice necessarily invites [the] attention [of the appellate court] to whether the jury's verdict might have been different if the identified error [or irregularity] had not occurred"53. The ultimate question for the appellate court in considering the application of the proviso is then whether the error or irregularity denied the appellant a real chance of acquittal or, to put the same question another way, whether the jury's verdict would inevitably have been the same if the identified error or irregularity had not occurred. Only if the appellate court after reviewing the record of the trial confidently answers that ultimate question in the affirmative can the appellate court conclude that no substantial miscarriage of justice has actually occurred. The trial judge's error in this case, in my opinion, did not lead to a failure of criminal process which was "such a serious breach of the presuppositions of the trial"54 that it amounted without more to a substantial miscarriage of justice. The trial judge's error was one of omission. In a direction in which the overall need for the jury to be unanimous as to the verdict was explained, what the trial judge omitted to do was to give a specific direction explaining the need for unanimity to extend to finding which, if either, of two discrete potential criminal acts each capable of causing the death of the deceased had been committed by the appellant55. The omission was not of such a magnitude as to have resulted in the case being able to be characterised as one in which "a jury has returned a verdict of guilty of a particular crime without having considered whether that crime was committed"56. Rather, the case is one in which the omission of the trial judge left open the possibility that the verdict of guilty that was returned by the jury resulted from some jurors finding that the appellant had committed only one criminal act and some jurors finding that the appellant had committed only the other criminal act. The question was whether, in the context of the trial, that possibility was more than theoretical. 53 AK v Western Australia (2008) 232 CLR 438 at 457 [59]; [2008] HCA 8. 54 Weiss v The Queen (2005) 224 CLR 300 at 317 [46]. 55 Lane v The Queen [2017] NSWCCA 46 at [18]-[44], applying Walsh (2002) 131 A Crim R 299 at 316-317 [57]. 56 Cf Quartermaine v The Queen (1980) 143 CLR 595 at 601; Kalbasi v Western Australia (2018) 92 ALJR 305 at 319 [56]; 352 ALR 1 at 18. In considering the application of the proviso, the majority of the Court of Criminal Appeal therefore embarked on the correct inquiry in examining the record of the trial to determine whether the jury would inevitably have been unanimous in finding that the appellant committed one or both of the potential criminal acts57. Where the majority of the Court of Criminal Appeal went wrong, in my opinion, was in confining their attention to the conclusions of fact which were objectively open to the jury on the evidence adduced at the trial. Finding that the jury could not have been satisfied beyond reasonable doubt as to one criminal act and that the jury could only have been satisfied beyond reasonable doubt as to the other criminal act, the majority concluded that the omission of the trial judge could have had no effect on the verdict which the jury in fact returned58. That was to adopt too narrow an approach to what the jury might have done had the jury been properly directed at the trial which in fact occurred. What the approach left out of account was the way in which the prosecution case had been put in closing submissions on the basis of the evidence that had been adduced59. Whatever the strength of the evidence relative to the two potential criminal acts, it cannot be said that there was no evidence at all to support a finding that the appellant had committed either of them, and the prosecution case was in fact left to the jury on the basis that it was open to the jury to find that the appellant had committed one or other or both of those criminal acts. The prosecution case having been so left, it "would be ignoring the realities of the matter"60 to infer with the requisite degree of confidence that no member of the jury could in fact have chosen one pathway of reasoning pressed by the prosecution in closing submissions so as to have been satisfied that the appellant committed one criminal act and that all members of the jury must surely have chosen the other pathway of reasoning pressed by the prosecution in closing submissions so as to have been satisfied that the appellant committed the other criminal act. Having regard to the way in which the case was left to the jury, it is impossible to be confident that the jury's verdict might not have been different if 57 Lane v The Queen [2017] NSWCCA 46 at [45]-[48]. 58 Lane v The Queen [2017] NSWCCA 46 at [50]-[61]. 59 Cf S v The Queen (1989) 168 CLR 266 at 287-288; [1989] HCA 66; KBT v The Queen (1997) 191 CLR 417 at 424; [1997] HCA 54; Pollock v The Queen (2010) 242 CLR 233 at 252 [70]; [2010] HCA 35. 60 Cf Mraz v The Queen (1955) 93 CLR 493 at 508; [1955] HCA 59. the omission of the trial judge had not occurred. The verdict which the jury as a whole in fact returned cannot be concluded to have been necessarily the same as the verdict which the jury would have returned if the jury had been properly instructed. For that reason, I agree that the appeal must be allowed, the conviction set aside, and a new trial ordered.
HIGH COURT OF AUSTRALIA AUSTRALIAN COMMUNICATION EXCHANGE LIMITED APPELLANT AND DEPUTY COMMISSIONER OF TAXATION RESPONDENT Australian Communication Exchange Ltd v Deputy Commissioner of Taxation [2003] HCA 55 1 October 2003 ORDER Appeal allowed with costs and cross-appeal dismissed with costs. Set aside paragraphs 1 and 2 of the orders of the Full Court of the Federal Court made on 28 November 2001 and the consent order made on 20 December 2001. In lieu thereof, order that the appeal to that Court be dismissed with costs. On appeal from the Federal Court of Australia Representation: G C Martin SC with L F Kelly for the appellant and cross-respondent (instructed by Corrs Chambers Westgarth) J J Batrouney SC with M M Brennan for the respondent and cross-appellant (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Australian Communication Exchange Ltd v Deputy Commissioner of Taxation Industrial law (Q) – Award – Superannuation – Employer's liability to pay "superannuation guarantee charge" dependent on payment of superannuation contributions in accordance with Clerical Employees Award (State) (Q) – Award requirement to contribute "3% of the employee's ordinary time earnings" – Whether employer had complied with Award – Casual employees – Meaning of "ordinary time earnings". Appeal – Decision of appellate court – Whether disentitled to decide case on an interpretation of a contested instrument different from that contended by either party – Whether bound to decide case on arguments advanced by the parties – Whether entitled to adopt a view on the construction of an instrument different from that contended by either party. Words and phrases: "ordinary time earnings". Superannuation Guarantee Charge Act 1992 (Cth). Superannuation Guarantee (Administration) Act 1992 (Cth), s 23(2). Clerical Employees Award (State) (Q), cll 3.5, 4.2, 4.7. GLEESON CJ. The issues in the case, the provisions of the relevant legislation and Award, and the facts, are set out in the reasons for judgment of Hayne J. The central problem concerns the construction of those provisions of the Clerical Employees Award - State (Qld) which govern the obligations of employers to make contributions to fund superannuation benefits for casual employees. Clause 3.5(2)(a) obliges employers to contribute to an approved Fund on behalf of each eligible employee "an amount calculated at 3% of the employee's ordinary time earnings". The expression "ordinary time earnings" is defined, in cl 3.5(3)(d), to mean "the actual ordinary rate of pay the employee receives for ordinary hours of work", to include "casual rates received for ordinary hours of work", and to exclude "overtime". There are three classes of employee: full-time, part-time, and casual. The matter of hours of work and overtime is dealt with by Pt 4. Clause 4.1 identifies ordinary hours of work, in a manner that refers primarily to full-time employees, in terms of an average of 38 hours per week and a spread of hours between certain times over certain days of the week. Clause 4.2, headed "Overtime", provides that work done outside or in excess of ordinary working hours is to be paid for at specified higher rates, and that such payments are to be in addition to the actual or ordinary weekly wage paid to the employee. Clauses 4.3, 4.4, and 4.5 (dealing with meal breaks, rest pauses and shiftwork) are irrelevant. Clause 4.6 deals with part-time employment. Clause 4.7 provides: "4.7 Casual Employment (1) Definition - A casual employee shall mean an employee who is engaged by the hour and who may terminate employment or be discharged at any moment without notice. Rate of Pay - Employees shall be paid an hourly rate by dividing the weekly rate of the appropriate classification by 38 and adding a loading of 19% thereto. (3) Hours - All time worked outside the spread of ordinary working hours or in excess of 8 in any one day or 38 in any one week shall be paid for at overtime rates ..." The problem is to relate cll 3.5(2)(a) and 3.5(3)(d) to the position of casual employees. The concepts of ordinary hours of work and ordinary rates of pay, which expressly apply to them by reason of the terms of the first and second sentences of cl 3.5(3)(d), have a meaning that can only be understood by reference to the definition provisions of Pt 4. Ordinary hours of work are dealt with primarily by reference to full-time employees, to whom they apply more naturally. But some meaning has to be given, in cl 3.5(3)(d), to the expression "actual ordinary rate of pay" in its application to casual employees, and to the expression "casual rates received for ordinary hours of work". This is necessary in order to calculate the "ordinary time earnings" of a casual employee, by reference to which the employer's obligation to contribute is measured. The question is complicated by the adoption in the Award of an elliptical method of drafting. The language of cl 3.5(3)(d) alternates between references to amounts of money and references to rates according to which such amounts are calculated. It refers to "actual ordinary rate of pay", loadings, allowances, and casual rates. However, it also refers to commission, bonuses and lump sum payments, which are amounts, not rates. Earnings, which is an amount, is said to "mean" a rate of pay. But a rate of pay can only be one integer in calculating an amount of earnings. And it is by reference to the amount of an employee's weekly earnings that an employer's liability to pay contribution is measured (cl 3.5(2)(c)). As Hayne J points out, three possible constructions have been advanced. The appellant contends for (and Dowsett J at first instance in the Federal Court accepted) a narrow construction, excluding from the "ordinary time earnings" of casual employees any amounts paid in respect of hours worked outside what, for a full-time employee, would be the ordinary number and spread of hours. The respondent (cross-appellant) contends for the view that, in the case of a casual employee, the distinction between ordinary time and overtime is meaningless, and that all earnings (except those, other than overtime, specifically excluded by cl 3.5(3)(d)) are ordinary time earnings. The difficulty with that view is that we are not concerned with an abstract question about whether casual employment may involve overtime, but with a concrete problem that arises in the context of applying the language of the Award (including "casual rates received for ordinary hours of work") for the purpose of calculating the "ordinary time earnings" of casual employees. The Full Court of the Federal Court adopted an intermediate position. For the reasons given by Hayne J, I consider that the preferable construction is that adopted by the Full Court. I would add two general observations. First, there is nothing unusual about a trial court, or an appellate court, adopting a view of the facts, or of the law (including the construction of a written instrument), different from the views for which the parties to litigation respectively contend. In the present case, each party contended for a particular meaning to be given to the Award. The Full Court of the Federal Court was not bound to adopt either of those meanings. It was entitled to reach its own conclusion as to what the Award meant, subject to the requirements of procedural fairness. No one suggests that those requirements have been offended. The facts are not in dispute; and it is not suggested that either party would have presented the case differently, in terms of evidence or argument, had the need to address the intermediate position adopted by the Full Court been anticipated. Having regard to their own interests, or the interests they represent, it is not surprising that the appellant contended for a narrower view than that of the Full Court, and the respondent contended for a wider view. That means only that this Court has three possibilities to address. Secondly, reference was made in argument to the purpose of the legislation in question and of the relevant provisions of the Award. It is, of course, proper to seek to give the Award a meaning which advances that purpose, so far as that can be done consistently with the text. However, it is one thing to say that the purpose of the legislation, and the Award, is to secure appropriately funded superannuation benefits for employees. That is undoubtedly so, and the social policy behind that purpose is well understood. It is another thing to say that, in order to further that purpose, when a question as to the construction of the Award arises, the Court should seek to give it a meaning that maximises the superannuation contributions payable. I accept that, for the reasons given by the Full Court, and by Hayne J, the narrow construction of the Award for which the appellant contends produces practical results that appear to limit the obligations of employers in relation to casual employees in a manner inconsistent with the demonstrable legislative and industrial purposes. On the other hand, I do not accept that those purposes can only be advanced by adopting the construction for which the respondents contend. Furthermore, that construction appears to me to involve an unacceptable disregard of the language of the instrument. The intermediate position adopted by the Full Court is that which best accommodates those purposes and the text of the Award. I would dismiss both the appeal and the cross-appeal. McHugh Callinan 10 McHUGH, GUMMOW, CALLINAN AND HEYDON JJ. In order to resolve this appeal from the Full Court of the Federal Court of Australia1, it is necessary to construe an award made by the Queensland Industrial Relations Commission under the Industrial Relations Act 1990 (Q). The award is the Clerical Employees Award – State (Q) ("the Award"). The necessity to construe the Award arises because the appellant employer's entitlement to be relieved from the obligations that it would otherwise have under the Superannuation Guarantee Charge Act 1992 (Cth) (the "Charge Act") and the Superannuation Guarantee (Administration) Act 1992 (Cth) (the "Administration Act") depend upon, and are ultimately to be measured by the Award. Facts and relevant legislation Before going to the most relevant sections, reference should be made to the scheme of the two Acts. Section 3 of the Charge Act provides that the Administration Act is incorporated in, and is to be read as one with the Charge Act. Section 5 of the Charge Act imposes a charge on any "superannuation guarantee shortfall" of an employer in a year. Section 6 of the Charge Act provides that the amount of the charge payable is equal to the amount of the shortfall. Section 16 of the Administration Act provides that the superannuation guarantee charge imposed on an employer's guarantee shortfall for a year is payable by the employer. Section 17 of the Administration Act provides that the employer's superannuation guarantee shortfall for a year is the total of the employer's individual superannuation guarantee shortfalls together with interest and an administration component. Section 19(2) of the Administration Act is concerned with the calculation of any shortfall. The Commissioner of Taxation has the general administration of the Act (s 43). The important sections for present purposes are ss 21 and 23 of the Administration Act. Section 21 prescribes a percentage which, by reference to an employee's wages, marks out the employer's obligation to make payment of a superannuation guarantee shortfall in respect of an employee. That percentage may be reduced by the operation of s 23 if relevant conditions are met. The relevant conditions are to be found in s 23(2) which provides that the charge percentage is to be reduced if in a contribution period: 1 Deputy Commissioner of Taxation v Australian Communication Exchange Ltd (2001) 48 ATR 426; [2001] ATC 4730. McHugh Callinan an employer is required by an industrial award or law ... to contribute for the benefit of an employee to a superannuation fund; and the requisite contribution the employee's notional earnings base or a percentage of that base calculated in accordance with the award or law; and is a specified percentage of the employer contributes to a complying superannuation fund for the benefit of the employee in accordance with the award or law." It follows that an employer may satisfy its obligations under the Acts if it complies with the obligation with respect to superannuation which an Award imposes on it. But before turning to the Award in question we should state the facts upon which the parties are agreed, and which show the factual setting for its operation. The appellant provided a national telephone relay service which enabled people who were deaf, or who had a hearing or speech impairment, to communicate with others. A person who wished to take advantage of the service would telephone a relay officer employed on a casual basis by the appellant. The relay officer would then act as a medium, converting text messages to voice, and vice versa. The appellant, pursuant to an agreement with the Commonwealth of Australia, undertook to provide the service 24 hours a day, seven days a week. The appellant operated two call centres, one in Brisbane and one in Melbourne. (This appeal relates only to payments made to relay officers in the appellant's Brisbane centre.) For the period with which this appeal is concerned, 1 June 1995 to 30 June 1998, all of the relay officers in the appellant's Brisbane call centre were employed on a casual basis under the Award. The hours worked by each relay officer in a fortnight were fixed by a fortnightly roster prepared by the appellant two weeks before the relevant period of work. If the times allocated to a particular relay officer were not convenient, the officer was permitted to change shifts, or parts of shifts, with other officers. This was arranged by the employees themselves without reference to, or the need for prior approval by the appellant which would be advised of the change at some point before the commencement of the shift. McHugh Callinan The respondent, the Deputy Commissioner of Taxation, issued amended assessments of the superannuation guarantee charge for the relevant period based on all hours worked by the appellant's employees. It is in respect of, and to challenge those arrangements that these proceedings were brought. Section 42 of the Administration Act provides for objections to assessments to be dealt with in the manner set out in Pt IVC of the Taxation Administration Act 1953 (Cth) ("the Taxation Act"). Part IVC (ss 14ZL-14ZZS) is headed "Taxation objections, reviews and appeals". The proceeding before the Federal Court was an "appealable objection decision", in which the appellant had the burden of proving that the assessments in question were excessive (s 14ZZO) and the Court was empowered to make orders confirming or varying the disallowance of the objections (s 14ZZ, s 14ZZP). The award Clause 2.1 of the Award refers to four categories of employees: weekly, part-time, casual or as provided in cl 1.2(2). Clause 4.7 provides a definition and a brief statement of some of the conditions of employment of casual employees. "4.7 Casual Employment (1) Definition - A casual employee shall mean an employee who is engaged by the hour and who may terminate employment or be discharged at any moment without notice. Rate of Pay - Employees shall be paid an hourly rate by dividing the weekly rate of the appropriate classification by 38 and adding a loading of 19% thereto. (3) Hours - All time worked outside the spread of ordinary working hours or in excess of 8 in any one day or 38 in any one week shall be paid for at overtime rates except where the arrangement of hours are worked in accordance with clause 4.1(1)(f). Provided a minimum of 2 hours shall be paid for each engagement." It can be seen that casual employees may, despite the different arrangements with respect to their pay, tenure as employees, and working times, qualify for overtime rates of pay, in addition to their hourly rate which is the ordinary rate supplemented by a loading of 19%. It is important to note that it is McHugh Callinan time worked outside ordinary working hours, or in excess of [beyond] eight hours in any one day, or 38 hours in any one week that will attract payment of an overtime rate: that is, that an entitlement to overtime payments is related essentially to when (outside ordinary hours as defined) work is performed. Nothing received in respect of work in ordinary hours is to be regarded as an overtime payment. Everything earned for hours of work outside, or beyond those ordinary working hours, it follows, must be an overtime payment. The term "ordinary hours of work" is relevantly defined as follows: "4.1 Hours of Work (1)(b) The ordinary hours of work prescribed herein may be worked on not more than five consecutive days in a week, Monday to Saturday inclusive, subject to the following: Except as otherwise specifically provided herein, ordinary hours may be worked between 6.30 am to 6.30 pm on Mondays to Fridays inclusive, and between 6.30 am and 12.30 pm on Saturdays. Such spread of ordinary daily working hours may be altered as to all or a section of employees provided that there is agreement between the employer and the employee or the majority of employees involved. (ii) Ordinary hours worked by all employees, excluding casuals, on a Saturday between the hours of 6.30 am and 12.30 pm shall be paid for at the rate of time and a-quarter. (iii) Any arrangement of hours which includes a Saturday as ordinary hours shall be subject to agreement between the employer and the majority of employees involved." Clause 3.5 is relevantly as follows: "3.5 Occupational Superannuation (1) Application - In addition to the rates of pay prescribed by this Award, eligible employees, as defined herein, shall be entitled to Occupational Superannuation Benefits, subject to the provisions of this clause. McHugh Callinan Contributions (a) Amount - Every employer shall contribute on behalf of each eligible employee as from 20 November 1989 an amount calculated at 3% [at the time of the making of the Award] of the employee's ordinary time earnings, into an Approved Fund as defined in this clause. Each such payment of contributions shall be rounded off to the nearest ten (10) cents. (c) Minimum Level of Earnings - No employer shall be required to pay superannuation contributions on behalf of any eligible employee whether full time, part time, casual, adult or junior in respect of any week during which the employees ordinary time earnings, as defined, do not exceed 35% of the Guaranteed Minimum Wage for the Southern Division, Eastern District, as declared from time to time. (3) Definitions 'Ordinary time earnings' shall mean the actual ordinary rate of pay the employee receives for ordinary hours of work including shift loading, skill allowances and supervisory allowances where applicable. The term includes any over- award payment as well as casual rates received for ordinary hours of work. Ordinary time earnings shall not include overtime, disability allowances, commission, bonuses, lump sum payments made as a consequence of the termination of employment, annual leave loading, penalty rates for public holiday work, fares and travelling allowances or any other extraneous payments of a like nature." (emphasis added) Some other clauses of the Award should be set out: McHugh Callinan "4.1 Hours of Work (4) Method of Payment for Ordinary Hours of Work and on Termination (a) Ordinary hours for all employees (excluding part time employees and casuals), shall be paid on the basis of not more than 38 per week on an averaged basis according to the work cycle, notwithstanding that in excess of 38 ordinary hours may be worked to maximise leisure time off in accordance with provision (a) of subclause (1), provision (f) of subclause (1) and provision (c) of subclause (2). Provided that in enterprises where clerical work is incidental to the main business of the employer and the majority of employees in the main business of the employer are paid on an actual hours of work per week basis, then clerical employees may be paid on the same basis as applies to the majority of the employer's employees." Further provisions are as follows: "4.2 Overtime Except as hereinafter provided, all work done outside or in excess of the ordinary working hours on any day shall be paid for at the rate of time and a-half for the first 3 hours and at the rate of double time for all work so performed in excess of 3 hours on any one day. Such payments shall be in addition to the actual or ordinary weekly wage paid to each employee. Employees called upon to work overtime on Saturday will be provided with a minimum of 2 hours work or payment therefore, provided that this paragraph shall not apply to overtime worked continuously with ordinary hours. Employees who work so much overtime between the termination of their ordinary work on one day and the commencement of their ordinary work on the next day that they have not at least had 10 consecutive hours off duty between those times, shall, subject to McHugh Callinan this subclause, be released after completion of such overtime until they have had 10 consecutive hours off duty without loss of pay for ordinary working time occurring during such absence. If on the instructions of the employer such an employee resumes or continues work without having had such 10 consecutive hours off duty, they shall be paid double rates until they are released from duty for such period and they shall then be entitled to be absent until they have had 10 consecutive hours off duty without loss of pay for ordinary working time occurring during such absence. The provision of this subclause shall apply in the case of shift workers who rotate from one shift to another as if 8 hours were substituted for 10 hours when overtime is worked - For the purpose of changing shift rosters; or (b) Where a shiftworker does not report for duty; or (c) Where a shift is worked by arrangement between the employees themselves." The case at first instance The core of the reasoning of the primary judge (Dowsett J) is to be found in this passage of his Honour's judgment2: "The definition of 'ordinary time earnings' clearly applies to casual employees. The reference to 'casual rates for ordinary hours of work' also indicates that a casual worker may be paid other than for 'ordinary hours of work'. This can only be as contemplated by para 4.7(3). In my view, the expression 'ordinary time earnings' in cl 3.5 includes, in the case of a casual employee, earnings received other than for time worked outside the spread of ordinary working hours as prescribed in subpara 4.1(1)(f) or in excess of 8 hours in any one day or 38 hours in any one week." 2 Australian Communication Exchange Ltd v Deputy Commissioner of Taxation (2001) 47 ATR 77 at 80 [8]. McHugh Callinan The appeal to the Full Court of the Federal Court The Full Court of the Federal Court (Wilcox, Hill and Carr JJ) unanimously upheld an appeal by the respondent but the result was one neither intended nor sought by either party. After discussing the entitlements of full-time employees their Honours said3: "The situation of casual employees is different. They are paid by the hour. When that hour falls within either category of overtime they are entitled to payment at a higher rate (time and a half for the first 3 hours and double time in excess of 3 hours on any one day). But it is only that increment in the rate, multiplied by the relevant number of hours, which constitutes the overtime payment for the casual employee concerned. The employee has a primary entitlement to be paid for each worked hour at the relevant hourly rate, just as full-time and part-time employees have a basic entitlement to a weekly wage. Then the casual employee has an additional entitlement to an overtime payment, brought about by enhancing the hourly rate. It is only that additional entitlement that may properly be described as an overtime payment. Only that additional entitlement is attributable to the fact that the worked hours are 'outside or in excess of' the employee's ordinary working hours. This approach achieves compatibility between the positions of full- time, part-time and casual employees. In each case the overtime payments are excluded from the definition of 'ordinary time earnings' in cl 3.5(3)(d). As we see the matter, there is nothing in the definition in cl 3.5(3)(d) which would exclude from 'ordinary time earnings' that portion of casual employees' remuneration for working in overtime periods to which they would have been entitled if they had not worked 'outside or in excess of' ordinary working hours. The opening words of the definition include the word 'means'. That may, where appropriate, be construed as 'means and includes'; it need not be an exclusive definition. The amount referred to in the first sentence of the definition is expressed in terms of a rate of pay. For casual employees their '... actual ordinary rate of pay [received] for ordinary hours of work 3 Deputy Commissioner of Taxation v Australian Communication Exchange Ltd (2001) 48 ATR 426 at 432 [24]-[29]; [2001] ATC 4730 at 4735. McHugh Callinan ...' is an hourly rate calculated by dividing the weekly rate of the appropriate classification by 38 and adding a loading of 19% thereto. In our view, the term 'ordinary time earnings for casuals' includes an amount calculated by multiplying that dollar rate by the actual number of hours worked, but does not include any overtime payment. By overtime payment we mean the incremental payment referred to ... above. Such a construction may not readily spring to mind on a first reading of cl 3.5(3)(d). However, it is consistent with the obvious purpose of that clause ie to include payments for work calculated by reference to ordinary rates of pay (including shift loading, skill allowances and supervisory allowances where applicable), but to exclude overtime and certain other payments not presently relevant. It follows that, when the respondent calculated its contribution obligation in respect of occupational superannuation for its casual employees, it should not have excluded the whole of the payments it made to them for hours worked outside or in excess of ordinary working hours; it should only have excluded such part of those payments as were true overtime payments in the sense explained above." The result was that the Full Court preferred a construction of the Award whereby contributions were assessed by multiplying the rate of pay applicable for work in ordinary working hours by the number of hours worked, whereas Dowsett J had favoured the basing of contributions on amounts paid for work (if any) within ordinary hours, as the appellant submits, and the Deputy Commissioner had sought (and still seeks) to fix upon all payments made, of whatever species. The appeal to this Court In this Court neither party seeks to uphold the conclusion of the Full Court which represents, as it itself conceded, effectively a compromise of the positions adopted by them. The respondent by a cross-appeal seeks the same relief and relies on the same grounds as at first instance and in the Full Court. The Court should accept the construction adopted by the primary judge, that for which the appellant contends. The task of this Court is to construe, in particular, cl 3.5 which is the clause that relevantly states the obligation of the appellant, that is, to make a contribution measured by and in respect of an employee's "ordinary time earnings". Other clauses in the Award are relevant only to the extent that they McHugh Callinan throw light on cl 3.5, or that they may define, or identify expressions used in the former. The first difficulty in construing cl 3.5 of the Award is created by the attempted equation (in cl 3.5(3)(d)) between "earnings" and "[a] rate of pay" when quite obviously they are not the same, the former being the product of the multiplication of the latter by the number of hours worked. Appellant's submissions The appellant submits that the reference to "ordinary time earnings" is a reference to earnings for hours worked other than overtime hours: accordingly, whatever a casual employee earns by way of overtime is not part of "ordinary time earnings", and therefore does not provide any measure of the appellant's liability to contribute superannuation payments for that employee in respect of those overtime payments. Respondent's submissions Before going to the detail of the respondent's submissions we would make these observations. The Award is an Award for different categories of employees. Its makers were careful to define a number of different concepts: for example, ordinary hours and overtime hours, and ordinary rates of pay and overtime rates of pay. They contemplated that casual workers would be able to qualify for work in overtime (that is work performed at times beyond any of the relevant spreads of hours) and that such work would attract an additional rate of pay, well knowing that superannuation would not be payable to a fund by the appellant in respect of overtime earnings. These are matters readily to be inferred from the language of the Award and should be taken as bearing upon the clarification of any ambiguities in it. Each of "casual employee", "ordinary hours", "ordinary working hours", "ordinary time earnings", "casual rates", "overtime" and "ordinary working hours for all employees" must be given meaning and effect under the Award. The principal submission of the respondent is that all of the provisions in cll 4.1 to 4.5 of the Award refer to full time employees only: that in particular "ordinary hours of work" in cl 4.1 ("an average of 38 per week") refer only to hours of full time employees. Several matters, the respondent submits, support this contention. Specific provision is made for the hours of part-time employees in cl 4.6(2) whilst none are specified for casual employees. This strongly suggests that the non-specific reference to hours in cl 4.1(1)(a) does not cover hours for part-time, and (by implication) casual employees. We would reject this submission. It may well be in the nature of casual employment that the hours of McHugh Callinan work for it are not rigidly specified long in advance. In practice here, the employees apparently changed the hours when it suited them and with the appellant's concurrence. Clause 4.7(3), which is concerned with casual employees, makes it clear that it is in respect of some hours only that overtime earnings are to be paid. This follows from the words, "all time worked outside the spread of ordinary working hours ... shall be paid for at overtime rates ...". The clause also makes it clear that there are to be payable to casual employees both ordinary and overtime rates of pay, and that the dichotomy between them will depend essentially upon when the hours are worked. Nor is it remarkable, as the respondent contends, that a casual employee who works outside the ordinary spread of hours of work might receive overtime rates, that is overtime payments only, and that accordingly the employer will not receive any relief from payment of the charge percentage under s 19 of the Administration Act. The Acts in this respect defer to the Award. It is not unreasonable to assume that its makers were aware of the effect of the former. If anomalies thereby arise, other provisions of the Award either have been designed to compensate for them, or no doubt will be. It is important to keep in mind that it is not the task of this Court, even if it were achievable, to rewrite the Award, or to venture into its crevices to try to discover whether, on its proper construction, it achieves parity between all workers. It is only partly right for the respondent, and, ultimately does not assist in the resolution of the appeal, to submit that the Award does not prescribe the ordinary hours which an employer must offer, or a casual employee must work or be willing to work. What the Award does specify is the spread of hours within which an employee may work for ordinary rates of pay. The fact that no work need necessarily be performed within those hours does not alter their quality as ordinary hours, or the nature of the rates of pay, and therefore earnings that they are to attract. The cross-appeal of the respondent should be dismissed. We appreciate the width of the power conferred upon the Federal Court by s 14ZZP of the Taxation Act to vary the disallowance of objections to assessments. Nevertheless, we question, at least in the circumstances of this particular case, the appropriateness of the adoption by the Full Court of an approach, and a conclusion, that neither party has sought. Perhaps it is desirable in the public interest that contributions be made to an approved fund calculated in accordance with the Full Court's compromise formula. But even though that may be so, which we are inclined to doubt as the respondent as the party responsible for the administration of the Acts advanced no such proposition, this remains civil litigation between parties who have identified the issues upon which they McHugh Callinan are joined. Even if we thought the reasoning of the Full Court correct, we would still entertain doubt whether we should uphold its conclusion, unwanted as it is by each side. We prefer to decide the case on the arguments advanced by the parties. We do not however consider that the Full Court was correct in its reasoning and decision. We do not accept that it is only the additional entitlement (that is, the difference between the ordinary rate of pay multiplied by the overtime hours worked and the total pay received for overtime work) that is to be regarded as "overtime" earnings within the meaning of cll 3.5, 4.2 and 4.7 of the Award. The definition in cl 3.5(3) of "ordinary time earnings" by reference to the actual ordinary rate of pay is intended to be read, and should be read, as the earnings for work done in ordinary time at the ordinary (not overtime) rate of pay. The Award itself is the result no doubt of compromises. It is not for this Court to reach a compromise of those compromises. The flexibility that casual work offers, and the desire of workers to engage in it, might well have been regarded as recompense for some other advantage forgone, either by the employee or employers or both of them. The casual "loading" of 19% might have been intended to offset all disadvantages, or may be less than it would be, but for the obligations that the appellant owes under the Acts. The framing of the definition of "ordinary hours" in the way that it was might itself have been of importance and advantage to casual employees as well as to the appellant. The Full Court saw as a desirable end, an interpretation of the Award which achieved "compatibility between the positions of full-time, part-time and casual employees"4. An assumption that compatibility be achieved or should be attempted between different classes of employees can provide no certain or justifiable basis for the construction of the Award. And although "means" might conceivably be construed as "includes" such a construction, in a case, as this one is, of a comprehensive definition omitting the word "includes", is, in our opinion an improbable one. It is not without significance that in adopting the construction that it did, the Full Court said that it was one that might "not readily spring to mind". The correct approach is not, with respect, that adopted by the Full Court, to search cl 3.5(3)(d) of the Award to see whether there is anything in it "which would exclude from 'ordinary time earnings' that portion of casual employees' (2001) 48 ATR 426 at 432 [25]; [2001] ATC 4730 at 4735. McHugh Callinan remuneration for working in overtime periods to which they would have been entitled if they had not worked 'outside or in excess of' ordinary working hours."5 The argument of the appellant is in our opinion correct. The conclusion of the primary judge which involved the acceptance of it is to be preferred for the reasons that we have given. The appeal should be allowed and the cross-appeal dismissed, in each case with costs. Orders 1 and 2 of the orders of the Full Court made on 28 November 2001 and the consent order made on 20 December 2001 should be set aside. In place thereof it should be ordered that the appeal from the orders of Dowsett J made on 2 May 2001 be dismissed with costs. The effect of these orders is to give the appellant its costs at all stages of the litigation. (2001) 48 ATR 426 at 432 [26]; [2001] ATC 4730 at 4735. Kirby KIRBY J. Each of the parties to the present appeal was discontented with the solution reached by the Full Court of the Federal Court of Australia to the problem of interpretation presented by the case6. In its judgment the Full Court reversed the orders of the primary judge in the Federal Court7. He, in turn, had overruled the primary assessments. In this Court, neither party sought to uphold the Full Court's interpretation. Australian Communication Exchange Limited (the appellant) asked this Court to return to the interpretation adopted by the primary judge. The Deputy Commissioner of Taxation (the respondent and cross-appellant) submitted that the Full Court had been correct to discern a flaw in the reasoning of the primary judge but had failed to follow through the logic of this conclusion. He argued that logic would result in the restoration of the respondent's amended assessments obliging the appellant to pay a superannuation guarantee charge for three financial years (1996, 1997 and 1998) in respect of portions of the wages of casual employees that the appellant had treated as outside the calculation. In his reasons, Hayne J has concluded that the solution reached by the Full Court, although rejected by the parties, represented the "preferable construction" of the words determining the obligations of the appellant8. Gleeson CJ has agreed with this conclusion9. During argument, like Caesar at the Lupercal, the respondent was thrice presented the chance of embracing the Full Court's approach, which he did thrice refuse10. By its appeal, the appellant was equally adamant. The fact that neither of the parties supported the Full Court's reasoning or conclusion is not a ground why this Court, giving effect to the requirements of the law, should not do so11. This Court, like the Federal Court, is a court of law. 6 Deputy Commissioner of Taxation v Australian Communication Exchange Ltd (2001) 48 ATR 426; [2001] ATC 4730. 7 Australian Communication Exchange Ltd v Deputy Commissioner of Taxation (2001) 47 ATR 77. An extract from the reasons of the Full Court appears in the reasons of McHugh, Gummow, Callinan and Heydon JJ at [29] ("the joint reasons"). 8 Reasons of Hayne J at [101]. 9 Reasons of Gleeson CJ at [6]. 10 Shakespeare, Julius Caesar, III, 2, 96. 11 Attorney-General (NSW); Ex rel McKellar v The Commonwealth (1977) 139 CLR Kirby It is not an arbitrator obliged to devise the best possible solution within parameters fixed by the parties. It does not exist merely to reach a conclusion wanted by one side of the contest12. It has a higher duty to the law. Sometimes, by the conduct of proceedings, a party may disentitle itself from claiming the benefits of the law13. Such cases apart, it is not for parties, by submissions or concessions, to deflect the Court from giving effect to the law, which has a public, not just private, quality and obligation14. In this respect, I fully agree with the approach of Gleeson CJ and also of Hayne J15. Their approach is clearly available to them. Not least is this so because the Full Court enjoyed the powers of the Federal Court under ss 14ZZ and 14ZZP of the Taxation Administration Act 1953 (Cth) to make orders confirming or varying the disallowance of objections. Nevertheless, at least where parties are well represented, their unanimous rejection of the approach and conclusions in the decision under appeal is a reason why a court should pause before embracing the unloved conclusion for itself. In the end, it is my view that the arguments of the respondent are to be preferred. The submissions of the appellant and the "compromise" adopted by the Full Court should be rejected. Nor was the primary judge in the Federal Court correct as the majority in this Court now conclude16. The primary assessments should be confirmed. The facts, legislation and award The facts and history of the litigation are set out in the joint reasons17 and the reasons of Hayne J18. So is a description of the applicable legislation19 and relevant extracts from the Clerical Employees Award – State (Q) ("the Award") 12 cf joint reasons at [41]. 13 Dovuro Pty Ltd v Wilkins [2003] HCA 51 at [75], [82]. 14 Roberts v Bass (2002) 77 ALJR 292 at 320-321 [143]-[144]; 194 ALR 161 at 199. 15 See especially reasons of Gleeson CJ at [7]; reasons of Hayne J at [101]. 16 Joint reasons at [45]. 17 Joint reasons at [15]-[20], [27]-[30]. 18 Reasons of Hayne J at [94]-[97]. 19 Superannuation Guarantee (Administration) Act 1992 (Cth); Superannuation Guarantee Charge Act 1992 (Cth). See joint reasons at [11]-[14]; reasons of Kirby made by the Queensland Industrial Relations Commission20. I will avoid repetition of these matters. The problem of construction is surprisingly difficult. The difficulty arises from the lack of clarity in the provisions of the Award. Normally, such problems can be safely left to the industrial representatives of the parties and to the tribunal appointed to make such awards. Where the language proves so obscure and uncertain, the tribunal might be persuaded to vary the award so as to remove the difficulty. However, in this case a special problem arises. The Award is given a particular status by federal law. Under s 23 of the Superannuation Guarantee (Administration) Act 1992 (Cth) ("the Administration Act"), in respect of the superannuation fund applicable to the appellant and its employees, the charge percentage levied on the appellant was calculated by reference to a contribution made by the appellant to its superannuation fund. That contribution, in turn, was to be calculated by reference to requirements imposed on an employer, such as the appellant, "by an industrial award or a law" of a specified kind. The Award was such an "industrial award". No issue was raised as to the constitutional validity of a reference in federal legislation to an industrial award made (as here) by a State industrial tribunal, subject to change from time to time, with consequent effect on the operation of the federal law. I will assume that, in picking up the provisions of a State industrial award as they appear from time to time, as a legislative fact, the provisions of s 23 of the Administration Act are constitutionally valid. Even if the constitutional problem is put to one side, the practical difficulties of incorporating by reference the requirements of a State industrial award remain. One of those difficulties is that such awards are not always drafted with the precision of language and logic of expression that one expects to find in federal legislation. Common experience teaches that the provisions of industrial awards are frequently hammered out between lay negotiators. They are typically submitted to tribunals, also often comprising lay members. Quite frequently, they are drafted in fractious and urgent circumstances. It follows that such provisions often present difficulties of construction that have to be resolved, or repaired in later disputes, by tribunals paying close attention to the purpose and spirit of the award rather than to an overly nice construction of its ambiguous language21. 20 (1993) 142 QGIG 153. See joint reasons at [21]-[26]. 21 Kucks v CSR Ltd (1996) 66 IR 182; Notification under section 130 by the Australian Workers' Union, New South Wales, of a dispute with WJ & A Seery re payment of overtime and penalty rates [2000] NSWIRComm 62 at [38]. Kirby The incorporation of an award in the operation of a federal Act thus introduces a special dimension to the difficulties of construction which this case highlights. Unfortunately, in its operation in relation to the superannuation entitlements of casual employees of the appellant, the Award is unclear and ambiguous. As Hayne J has shown, there are at least three possible approaches to the meaning of the critical provisions22. This Court has no authority to fix the problem presented by the appeal by clarifying the terms of the Award, as an industrial tribunal might do, by varying its provisions. In this the joint reasons are obviously correct23. All that this Court can do is to identify the construction thought to be the preferable one. That preferable construction is then designated the correct, and only, legal meaning of the Award. Of course, there is a danger that the legal meaning may be different from that which the negotiating parties intended and that the tribunal making the Award believed it was making for the purpose of resolving the industrial dispute before it. That danger is mollified, to some extent, by contemporary approaches to the construction of disputed language, adopted by the courts when faced with problems such as the present. The approach to the disputed construction The primary function of a court, asked to solve a problem of the present kind, is to give meaning to the disputed language. Interpretation is a text-based activity. This means that the focus of attention is upon the legally relevant words. In the present case, those words are found in the Administration Act incorporating the Award provisions by reference (and in its companion the Superannuation Guarantee Charge Act 1992 (Cth) ("the Charge Act")), as well as in the Award itself. The key provision of the Administration Act refers to the requirement upon the employer bound by its provisions "to contribute for the benefit of an employee to a superannuation fund"24. The interface between the federal Administration Act and the State Award is only rendered significant because of the formula established by the Act, which provides for the reduction of the charge percentage to which the employer is otherwise liable by reference to the "employee's notional earnings base"25 as determined by the requirements, relevantly, of any applicable "industrial award"26. 22 Reasons of Hayne J at [101]. 23 Joint reasons at [38]. 24 s 23(2)(a). 25 Administration Act, s 23(2)(b). 26 Administration Act, s 23(2)(a). Kirby If this were a case in which the provisions of the Award were clear and unambiguous, a court would simply give its provisions effect according to their terms. This would follow from the incorporation in the federal Act of reference to the applicable industrial award and specifically the establishment of a formula to be applied in determining the obligations of the employer by reference to the employee's "notional earnings" under the Award. However, where, as here, the Award is ambiguous and unclear, the plain meaning rule will not yield the solution to the problem. It is then necessary, both by the requirements of statute law27, and by the developments of the common law28 for regard to be had to the purpose of the legislation and, so far as it is relevant, of the Award incorporated in it by reference. In his reasons, Hayne J29 suggests that it would be wrong to approach the task of construing the Award from an assumption that its superannuation provisions were intended to benefit all classes of employees equally or to achieve a result that might be regarded as fair or desirable (as distinct from the result obliged by the language of the Award that might possibly represent an industrial compromise of which the Court was unaware). I can support these propositions so far as they go. But they do not go far because, at the close of his reasons, Hayne J invokes, in support of the interpretation that he favours, the comforting consideration that that construction "does not lead to any significant discordance between the entitlements of those who were employed by the week … and those whose employment could have been terminated at will"30. The reason why this is a comforting fact is that the Award provisions are not ordinary stand-alone clauses in an industrial instrument affecting only the parties to the Award. The provisions in issue concern superannuation entitlements. They are elements of a major shift in employee benefits that came 27 Acts Interpretation Act 1901 (Cth), ss 15AA, 15AB. See also Acts Interpretation Act 1954 (Q), s 14A as applied by s 14(1) and Sched 1 of the Statutory Instruments Act 1992 (Q). By s 7 of the latter Act, an award falls within the meaning of a "statutory instrument" as it is made under an Act, namely Industrial Relations Act 1999 (Q), s 125. 28 Bropho v Western Australia (1990) 171 CLR 1 at 20; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69], 384 [78]. 29 Reasons of Hayne J at [115]. 30 Reasons of Hayne J at [124]. Kirby about throughout Australia in the early 1990s. It was a shift stimulated and reinforced by federal legislation, including the Administration Act. Any approach to the interpretation of the ambiguities and obscurities of the Award would miscarry if it failed to take this critical shift in industrial practice and federal legislative purpose into close account. Far from being irrelevant considerations (or matters relevant only so far as they can be viewed as comforting or confirmatory), the construction of the Award provisions must be undertaken in this case with a view to fulfilling the clear purposes of the relevant federal legislation, including the Administration Act. What were those purposes? The passage of the Administration Act followed two major concerns of the Federal Parliament to which the Act (and cognate measures including the Charge Act) gave effect. The first was the need to reduce the dependence of wage-earners in Australia upon the age pension as the main source of their retirement income. The second was to broaden the attraction of superannuation so that it would become accessible to a wider class of non-wealthy wage earners and financially attractive to employees who had previously been disadvantaged so far as superannuation was concerned. These two objectives were interrelated. Unless superannuation could be made more universally attractive, so as to afford coverage for previously disadvantaged groups of employees, the desired shift from dependence upon government funded aged pensions would not happen. In a report of a Senate Select Committee, prepared in relation to the Bill that became the Administration Act, it was pointed out that legislative measures on the part of the Federal Parliament were needed if superannuation was truly to provide "coverage for disadvantaged groups"31. Amongst the groups named were part-time and casual employees; female workers; employees in rural industries; and juniors, who made up a major proportion of casual workers32. In Australia, the numbers of "permanent casual" workers have grown enormously in recent years. What once would have been regarded as an oxymoron is now an industrial commonplace. The Administration Act must be construed in the context of these significant changes to employment practice and federal law, stimulated and sanctioned by tax implications for superannuation and tax charges for non- complying employers, aimed, in effect, at shifting a large part of post-retirement 31 Australia, Senate Select Committee on Superannuation, Second Report of the Senate Select Committee on Superannuation: Super Guarantee Bills, June 1992 at 32 Australia, Senate Select Committee on Superannuation, Second Report of the Senate Select Committee on Superannuation: Super Guarantee Bills, June 1992 at Kirby income support from government pensions to personal savings (necessarily and substantially derived from employment income)33. In introducing the Bill for the Administration Act into the Parliament, the Treasurer drew particular attention to the fact that "award superannuation has fostered the spread of superannuation to large areas of the work force which previously had no cover"34. Accordingly, there was a deliberate symbiosis between award provisions (such as those in the Award) and legislation (such as the Administration Act). The reference in the one to the other is confirmatory of the intended interaction of the two. The time sequence of the adoption of the two legal instruments is also confirmatory. The Administration Act commenced operation on 1 July 1992. The Award was made in February 1993. The Award should be read as having the specific purpose of carrying into effect the objects of the Administration Act. In order to make the legislative provisions work, a statutory charge was levied on those employers who failed to contribute in accordance with the enacted formula. That formula contained reference to any applicable industrial award provisions. It follows that, far from it being inappropriate to consider these contextual features, they are crucial to appreciating the way the two legal instruments were designed to work together. Given that the Award secured a specified status under the Act, it is consonant with applicable principles of statutory construction to adopt a meaning of the Award that advances the legislative purposes. Given that the Award language is ambiguous, it is not only permissible but also necessary to resolve the ambiguities by favouring the construction that fulfils the purpose of the Award in the context of the purposes of the Administration Act. Amongst those purposes was the achievement of industrial equity in the matter of superannuation for one of the "disadvantaged groups" of employees for whose particular the Administration Act was enacted, namely casual employees. If one construction of the Award, so incorporated, tends to protect the superannuation entitlements of casual employees and another does not, the former should be preferred and the latter rejected so far as the language of the Award permits. There is nothing heterodox in this reasoning. It is perfectly orthodox35. And it is also highly instructive when one gets down to the detail of the contested language of the Award. interests 33 Australia, House of Representatives, Parliamentary Debates (Hansard), 2 April 1992 at 1763 (Mr Dawkins, Treasurer). 34 Australia, House of Representatives, Parliamentary Debates (Hansard), 2 April 1992 at 1763 (emphasis added). See also Superannuation Test Case – September 35 Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390 at 397 per Dixon CJ; Kucks v CSR Ltd (1996) 66 IR 182 at 184. Kirby The appeal: casuals and "ordinary hours of work" Read against the background of these contextual considerations, neither the Administration Act nor the Award lends support to the construction of the latter urged by the appellant. So far as the Administration Act is concerned, it is clear that its purpose was to ensure that minimum employer superannuation contributions were paid in relation to all employees, subject only to limited exceptions36, none of which was applicable to the present case. Casual employees were not exempted from the coverage of the Act unless, in a particular case, narrowly drawn criteria37 (all of which were inapplicable in this case) applied. The construction of the Award urged by the appellant would have the result of minimising, and in some cases defeating, the purposes of the Administration Act to ensure access by all employees (including casuals) to employer contributions to superannuation unless the employer was expressly relieved of obligations by that Act in respect of such employees. From the point of view of the Administration Act, there are a number of difficulties in the construction of "ordinary time earnings" for casual employees urged by the appellant and adopted by the primary judge. That construction led to the conclusion that, in calculating superannuation contributions for such employees, it was necessary to exclude earnings for time worked outside the spread of ordinary hours (as prescribed by cl 4.1(1)(a) and (f) of the Award) in excess of eight hours in any one day or 38 hours in any one week. As the Full Court explained and illustrated, that construction produced "strange results"38. It was the discordancy between those results and the way in which the Administration Act was intended to operate that led the Full Court to reject the appellant's construction of the Award and to search for a different one. The "strange results" itemised in the reasons of the Full Court did not present the entire picture. Thus, the construction urged by the appellant would mean that a casual employee who, in any contribution period, only worked hours 36 The wages must amount to $450 or more in a month; the employee must be less than 65 years old; the employee, if part-time, must be 18 years old or over; and no special exemptions in the Administration Act can apply: Administration Act, ss 27 and 28. 37 see Administration Act, ss 12(9A), 12(11), 19(4), 27, 28 and 29. 38 Deputy Commissioner of Taxation v Australian Communication Exchange Ltd (2001) 48 ATR 426 at 431 [19]; [2001] ATC 4730 at ¶4,734. Kirby outside the spread of hours mentioned in cl 4.1(1) of the Award, would have a "notional earnings base", for the purposes of s 23(2) of the Administration Act, of zero (that is, no notional earnings base) by reference to which the employer contribution was to be calculated. This would mean, in such a case, that s 23(2) of the Administration Act would not operate to reduce the employer's charge percentage in respect of such an employee for that contribution period. The employer would be required to pay the full charge percentage on the total salary or wages paid to that employee pursuant to s 19 of the Administration Act. Conversely, if the appellant's construction of "ordinary time earnings" were accepted and the same employees worked half an hour of "ordinary" time, as so defined, during the whole three month contribution period, the employer would be required to contribute only 6% of the wages payable for that half hour in order to reduce the charge percentage applicable to the entire three month period to zero. Such a capricious operation of the legislation, that would defeat its obvious and stated purposes (including in respect of casual employees), should not be accepted. The appellant's construction not only runs into difficulties so far as the operation of the Administration Act is concerned. It does not accord with the language of the Award39 nor with the Award's structure and purposes. The superannuation provisions in the Award were clearly intended to extend to casual employees. Thus, the Award makes specific reference to employer superannuation support for full-time, part-time and casual employees who, after an initial qualifying period, earn more than a specified wage40. Given such express indications that casual employees will enjoy superannuation support entitlements under the Award, alongside full-time and part-time employees, it would be an odd, even bizarre, result of the operation of the Award for casual employees, who in any contribution period worked exclusively during hours that fell outside the spread of hours specified in cl 4.1, to be excluded from occupational superannuation support. In the hard-nosed and practical setting of an Australian industrial award, providing for remuneration for employees which is increasingly viewed as including the element of superannuation support41, an odd or bizarre reading of the award is not one that would readily be accepted. A court, approaching the 39 Deputy Commissioner of Taxation v Australian Communication Exchange Ltd (2001) 48 ATR 426 at 431 [21]; [2001] ATC 4730 at ¶4,734. 40 Award, cl 3.5(2)(c). 41 Re Manufacturing Grocers' Employees Federation of Australia; Ex parte Australian Chamber of Manufactures (1986) 160 CLR 341 at 355-356. Kirby construction of the award would naturally favour a meaning that, so far as the language permitted, avoided unexplained exceptions from benefits and discriminatory provisions apparently inconsistent, not only with the award's broad purposes, but also with those of related federal legislation. In the present appeal, when one turns to the Award's purposes, and acknowledges the coverage of full-time, part-time and casual employees alike, it becomes easier to see what "ordinary time earnings" means in the context. For a full-time or part-time employee it represents the amount calculated by the base rate that such an employee receives for the hours of work for which the employee is engaged. A casual employee, on the other hand, receiving "casual rates", is in a different category. By definition, a casual employee is not employed by reference to a given weekly interval of hours, whether full-time or part-time. On the contrary, a casual employee, as the Award itself makes clear, is "an employee who is engaged by the hour and who may terminate employment or be discharged at any moment without notice"42. It follows that the "ordinary hours of work" of an employee paid casual rates are not fixed by reference to the hours of the week. For a casual employee the "ordinary hours of work" are the hours that the casual employee actually works. This construction is compatible, in my view, with the reference in the definition of "ordinary time earnings" in cl 3.5(3)(d) of the Award to the inclusion in "ordinary time earnings" of "casual rates received for ordinary hours of work". The words of that paragraph show the imperfections of the text43. But such difficulties can be overcome by approaching the meaning of cl 3.5 of the Award with the purposes of the Award provisions, and the related provisions of the Administration Act, kept firmly in mind. Approached in that way the "notional earnings base" of a casual employee, established by reference to "ordinary time earnings" (as defined in cl 3.5(3)(d) of the Award) is all time earnings for all hours actually worked. No other construction does justice to the fundamental difference between the time obligations of full-time and part-time employees and the completely different time arrangements for casual employees. The Full Court was therefore right to reject the submissions of the appellant. The Full Court was right to correct the conclusion of the primary judge. However, in my view the Full Court erred in adopting a construction of the Award, advanced by neither party, that fell between the respective cases for the appellant and respondent. The logic of its acknowledgment of the error of the appellant's construction of the Award and the Administration Act should have led 42 Award, cl 4.7(1). 43 Reasons of Gleeson CJ at [5]; reasons of Hayne J at [110]. Kirby the Full Court to accept the respondent's submissions. That logic requires that the cross-appeal be allowed. The cross-appeal: the exclusion of "overtime" The obligation of the employer in accordance with the Award was to pay an amount calculated by reference to the employee's "ordinary time earnings"44. By the Award, these "shall not include overtime"45. The question in the cross- appeal is therefore how "overtime", referred to in this exclusion, is to be calculated in the case of casual employees. The primary judge concluded that a casual employee's earnings received for time worked outside, or in excess of, ordinary working hours (as he defined them) were to be treated, in effect, as if they were "overtime" and therefore excluded from "ordinary time earnings" as defined in the Award. The Full Court found that under the Award there were "ordinary hours of work". Any other time worked was to be treated as "overtime", being hours of work that were not "ordinary hours of work". In the case of full-time and part-time employees, overtime payments for working "overtime hours" were received in accordance with cl 4.2 of the Award. Such payments were received in addition to the ordinary weekly wage. However, for casual employees the Full Court found that "ordinary time earnings" encompassed only a portion of the remuneration paid for all hours worked. Overtime payments were therefore to be reconstructed by reference to the incremental amount paid in addition to the portion worked during ordinary hours. For a number of reasons, it is my view that the parties were correct to reject the somewhat artificial attempt of the Full Court to conceive "overtime" in the case of casual employees in the way that it did. It is crucial in this respect to note the distinction made by the Award between "overtime" and "overtime rates". The concept of "overtime" in cl 4.2 of the Award coincides with the concept of "overtime" in common parlance. There it constitutes a reference to work performed beyond ordinary hours that, incidentally, attracts a special (greater) rate of pay, typically time and a half or double time. However, the whole point of casual employment is to distinguish it from this normal aspect of weekly employment (whether full-time or part-time). Except to the extent that the Award makes special and particular provisions for overtime for casual employees, they would usually fall outside the normal provision for overtime hours at overtime rates. With respect, the reasoning of the Full Court failed to 44 Award, cl 3.5(3)(d). 45 Award, cl 3.5(3)(d). Kirby give effect to the distinction earlier drawn in rejecting the appellant's primary argument, that is, the distinction between working overtime hours and working ordinary hours of work. Under the Award, overtime hours and ordinary hours of work are discrete in point of time. Overtime payments for employees paid by reference to set hours of work are made by reference to the working of hours that are truly characterised as overtime hours. Casual employees, by way of contrast, are paid for working ordinary hours of work. Casual employees receive an hourly rate, loaded for the incidents of casual employment. The only overtime rates that casual employees receive are those specifically provided in cl 4.7 of the Award. Such rates are paid for time worked outside the spread of ordinary working hours in excess of eight in any one day or 38 in any one week. No part of the other times that a casual employee works can properly be characterised as overtime. In so far as specific reference is made in cl 3.5(3)(d) to "casual rates received for ordinary hours of work", it is important to note that the word "rates" appears in the plural. Such "rates" may include casual loadings and additional rates akin to penalty rates. The parties were agreed that casual loadings are generally considered as compensation to employees for the burdens associated with working on a casual basis. Those burdens are not necessarily – and often not at all – related to work considerations involving hours of work. Such rates pre-existed Award provisions affording access to occupational superannuation. They were not intended to encompass compensation for any reduced access to such new benefits. When regard is had to cl 4.2 of the Award it is clear that "overtime" is defined as a measure of "work done" in hours that are worked outside, or in excess of, the ordinary working hours of the employee. Payment for working overtime is calculated at specified rates. Such rates are to be received in addition to the actual or ordinary weekly wage paid to the employee. Therefore, overtime is work done in hours which are worked in addition to work done in "ordinary hours". The concept of "overtime" as hours worked in addition to ordinary hours worked is long established in this field of discourse46. A casual employee does not therefore work "overtime" simply because that employee does not work hours in addition to ordinary hours of work. Nor does a casual employee receive payments for "overtime" in addition to an actual or ordinary weekly wage. In so far as cl 4.7 of the Award identifies certain rights to overtime rates in the case of 46 Municipal Officers' Association of Australia v Council of Shire of Maroochy unreported, Federal Court of Australia, 20 August 1981 at 7-12 per Evatt J; Workers Rehabilitation & Compensation Corporation v Harle (1994) 61 SASR 507 at 510, 514, 519; Quest Personnel Temping Pty Ltd v Commissioner of Taxation (2002) 116 FCR 338 at 344-345 [27]-[29]. Kirby casual employees, it makes a specific and limited provision. It does not incorporate casual employees for this purpose within cl 4.2 of the Award. The definition in that clause, making reference to work performed in addition to actual or ordinary hours, distinguishes the case of a casual employee who, by definition, works according to a different time principle. It follows that the respondent's submission is correct in saying that the concept of "overtime" in ordinary time earnings should be construed in a manner consistent with the concept of "overtime" as defined in cl 4.2 of the Award. This means overtime for hours worked "outside or in excess of the ordinary working hours on any day" resulting in payments "in addition to the actual or ordinary weekly wage paid to each employee". Those expressions are simply inapplicable, indeed they are nonsensical, in the case of a casual employee. There is nothing in the Award to suggest that overtime in "ordinary time earnings" has a meaning different from that in cl 4.2 confined to the case of casual employees. Instead, as a member of one of a list of extraneous payments referred to in cl 3.5(3)(d), the definition there appearing supports the proposition that the payments of "overtime" are payments in addition to payments of casual rates for ordinary hours worked. The solution proposed by the Full Court presents difficulties of its own, especially when the Award is viewed in its industrial context. In that context, the provision of penalty rates for work done in hours considered "overtime" is the subject of frequent conflict, negotiation and settlement in the form of industrial awards and certified agreements47. To describe all time worked outside, or in excess of, the spread of "ordinary hours" as "overtime" for all employees, and to treat each and every payment made to such employees for work performed within those hours as payments for "overtime", is to adopt a construction that overlooks industrial realities. It also ignores the structure of the Award in which particular provision is made for "casual employment" in cl 4.7 and in respect of "overtime rates" in cl 4.7(3). This reasoning confirms that "overtime", when appearing in the definition of "ordinary time earnings" in cl 3.5(3)(d) of the Award, is confined to payments made to compensate an employee who works outside, or in excess of, ordinary working hours as they are prescribed for such an employee. Because it is of the essence of the work of a casual employee that no such "ordinary hours" are prescribed, no amounts paid to them can properly be described as "overtime" for the purposes of that definition. 47 eg XL Parcel Express Pty Ltd v Transport Workers' Union of Australia (1996) 151 QGIG 2079 at 2082. Kirby I concede that the approach to the meaning of the Award that I favour involves some difficulties and that the Award is less than clear. But the other two approaches canvassed in the appeal also present difficulties, as I have shown. In the end, I prefer the approach urged by the respondent on the basis that that construction involves a more realistic interpretation of the Award when read in its industrial setting. It is one that is available in the language of the Award. Additionally, the respondent's construction facilitates the achievement of the expressed and implied objectives of the Administration Act, so far as that Act incorporated this and other industrial awards by reference. The appellant's construction tends to frustrate the achievement of that Act's objective. The Full Court's interpretation only achieves it in part. However, it does so at the cost of adopting what in my view is an unrealistic and artificial interpretation. The respondent's interpretation comes closest to achieving the presumed object of negotiating the provisions of "occupational superannuation" in the Award, designed to tie the Award to the then recently enacted federal superannuation legislation, which included the Administration Act. Orders The appeal should be dismissed with costs. The cross-appeal should be allowed with costs. The judgment of the Full Court of the Federal Court of Australia should be set aside. In place of that judgment, it should be ordered that the appeal to that Court be allowed with costs; the orders of the primary judge be set aside; and in their place it be ordered that the appellant's appeal to the Federal Court from the decision of the respondent made on 10 May 2000 be dismissed with costs. Hayne HAYNE J. The Superannuation Guarantee (Administration) Act 1992 (Cth) ("the Administration Act") and its related Act, the Superannuation Guarantee Charge Act 1992 (Cth) ("the Charge Act") were intended, so the Treasurer said in the Second Reading Speech for the Bill for the Administration Act48, to encourage employers to provide a minimum level of superannuation support for employees. Employers who provide less than the minimum level of superannuation support are liable for a superannuation guarantee charge which is used, after deduction of administration costs, to meet the superannuation contribution entitlements of employees49. The Commissioner of Taxation has the general administration of the Administration Act50. Section 16 of the Administration Act provided that "superannuation guarantee charge" is to be paid on "an employer's superannuation guarantee shortfall for a year". In working out whether an employer has a superannuation guarantee shortfall, account is taken of what contributions the employer has made for the benefit of employees to defined benefit superannuation schemes51 and to other superannuation funds52. In particular, if an employer is required by an industrial award to contribute for the benefit of an employee to a superannuation fund, and if two further conditions are met (first, that the requisite contribution is a specified percentage of what the Administration Act calls "the employee's notional earnings base" and, secondly, that the employer contributes to a complying superannuation fund for the benefit of the employee in accordance with the award) the charge percentage for the employer is reduced53. This appeal and the respondent's cross-appeal concern the operation of these provisions of the Administration Act. The appellant employed casual employees whose employment was governed by the Clerical Employees Award – State (Q) ("the Award"). The determinative question in the proceedings is whether the appellant made contributions to a complying superannuation fund for the benefit of those employees in accordance with the Award. 48 Australia, House of Representatives, Parliamentary Debates (Hansard), 2 April 49 Superannuation Guarantee (Administration) Act 1992 (Cth), Pt 6, ss 46-58, Pt 8, Hayne The assessments to superannuation guarantee charge and the proceedings below The appellant provided a national telephone relay service enabling those who have a hearing or speech impairment to communicate with others. A person using the service used a teletypewriter, modem and telephone to send text messages to a Relay Officer. The Relay Officer read the text messages to the intended recipient of the message and conveyed, in text, the recipient's responses to the person using the service. The appellant provided this service 24 hours a day, seven days a week. It operated two call centres, one in Brisbane and one in Melbourne. The Commissioner assessed the appellant to a superannuation guarantee charge for the years ending 30 June 1996, 30 June 1997 and 30 June 1998 in respect of some of the wages the appellant had paid to persons it employed as Relay Officers in its Brisbane call centre. The assessments now in question were amended assessments issued on 12 January 2000. Nothing was said to turn on the fact that they were amended assessments. For the years in question, all the Relay Officers in the appellant's Brisbane call centre were employed as casuals. Their employment was regulated by the Award. The appellant objected to the amended assessments. The respondent wholly disallowed the objections. The appellant appealed to the Federal Court of Australia. The primary judge (Dowsett J) ordered54 that the respondent's decision disallowing the objection be varied by allowing the objection in full. From this decision the respondent appealed to the Full Court. That Court (Wilcox, Hill and Carr JJ) allowed the appeal55 and set aside the orders of Dowsett J. The Full Court did not, however, accept that the amended assessments which the respondent had issued were based on a correct construction of the Award. Rather, the Full Court concluded that the proper construction of the Award "provide[d] a result that lies between the positions contended for by the parties"56. Accordingly, the Full Court ordered that the decision to disallow the objections be varied to allow so much of the objections as would result in an assessment being made in accordance with the reasons of the Full Court. It is from these orders that, by special leave, the appellant appeals, and the respondent cross-appeals. 54 Australian Communication Exchange Ltd v Deputy Commissioner of Taxation (2001) 47 ATR 77. 55 Deputy Commissioner of Taxation v Australian Communication Exchange Ltd (2001) 48 ATR 426; [2001] ATC 4730. 56 (2001) 48 ATR 426 at 433 [31]; [2001] ATC 4730 at 4736. Hayne The parties' contentions Three different views of the appellant's obligations under the Award require consideration. The appellant submitted that the primary judge construed the Award correctly. It submitted that the Award required it to make superannuation contributions, for Relay Officers at its Brisbane call centre, calculated as a percentage of the amount paid to them for the work they did during the ordinary working hours fixed by the Award. It submitted that no superannuation contribution was to be paid on amounts paid for work done outside those hours. (Work done outside ordinary working hours was paid at a higher rate than work done within those hours.) The second view of the Award is the construction which underpinned the Full Court's conclusion. It held that the Award obliged the appellant to pay a greater superannuation contribution than the appellant had contended, and the primary judge had held, was required. The Full Court concluded that superannuation contributions were to be calculated as a percentage of an amount derived by multiplying the number of hours a Relay Officer actually worked by the rate of pay which that employee would have received for working during ordinary working hours. In this Court, the respondent submitted that both the primary judge and the Full Court had erred in construing the Award. The respondent submitted, as it had in the courts below, that the Award required the appellant to make superannuation contributions calculated as a percentage of all amounts paid to the Relay Officers, no matter whether the work was done in or outside ordinary working hours. Accordingly, the respondent cross-appeals against the Full Court's orders. It will be necessary, therefore, to consider these three different constructions of the Award obligation to make superannuation contributions: contributions were to be based on amounts paid for work within ordinary hours (the appellant's construction); contributions were to be based on amounts calculated by multiplying the rate of pay applicable for work in ordinary working hours by the number of hours worked (the Full Court's conclusion); and (iii) contributions were to be based on all payments made to Relay Officers (the respondent's construction). These reasons will seek to demonstrate that the conclusion reached by the Full Court gives effect to the preferable construction of the Award. Hayne Before considering the competing constructions of the Award, it is as well to make more detailed reference to some provisions of the Administration Act and of the Award. The Administration Act The Administration Act provided that the amount of an employer's superannuation guarantee shortfall was to be calculated as a percentage of the total salary or wages paid by the employer to the relevant employee during the period in question57. The percentage to be applied was to be ascertained according to s 20 or s 21 of the Administration Act, as reduced in respect of the employer by s 22 or s 23. Section 20 applied to those who were employers for the whole of the 1991-1992 year; s 21 applied to those who were not an employer for the whole of that year. The appellant was not an employer for the whole of 1991-1992 and s 21 therefore applied to it. Each of ss 20 and 21 made different provisions for the percentage to be applied according to whether the employer's payroll did, or did not, exceed a specified sum. As mentioned earlier, s 22 provided for the reduction of the percentage thus identified by s 20 or s 21 where an employer contributed to a defined benefit superannuation scheme; s 23 provided for reduction where the employer contributed to a superannuation fund other than a defined benefit scheme. Section 23 was engaged in this case. The contributions which the appellant made for the benefit of its Relay Officers were made to a complying superannuation fund which was not a defined benefit scheme. Section 23 required reduction of the percentage fixed by s 20 or s 21 (here s 21) by reference to "the amount of the percentage figure that expresses the contribution to the fund ... as a proportion of the total amount of the employee's notional earnings base"58. An employee's "notional earnings base" was defined in a number of provisions. For present purposes, it is enough to notice only s 14(2) which provided, in effect, that the notional earnings base, for employees such as the appellant's Relay Officers, was the earnings by reference to which the employer's contribution was to be calculated under the applicable award. (Section 23 also provided for adjustments according to whether the employee was employed under the relevant award or law for only part of the period in question, but it is not necessary to notice the way in which those aspects of the provision were expressed or worked.) At the risk of oversimplifying statutory provisions expressed with much elaboration, it follows that if an employer was bound by an award to contribute to 57 ss 18 and 19. Hayne a superannuation fund an amount calculated as (say) 3 per cent of the gross earnings of an employee, and the employer made the contributions that were required by the award, the charge percentage to be applied to that employer would be the figure specified in s 20 or s 21 (as the case required) minus three. But that reduction could be made under s 23(2) only if the employer contributed to a fund "in accordance with the award or law". It is, therefore, necessary to refer to some provisions of the Award, including not only those which governed the appellant's obligations to make superannuation contributions on behalf of employees, but also some others which regulated employment under the Award. The Award The Award (cl 2.1(1)) required an employer "[a]t the point of engagement of each employee" to "specify whether the engagement is on a weekly, part-time or casual basis". By cl 4.7(1) a casual employee was defined as "an employee who is engaged by the hour and who may terminate employment or be discharged at any moment without notice". They were to be paid "an hourly rate by dividing the weekly rate of the appropriate classification by 38 and adding a loading of 19% thereto" (cl 4.7(2)). For full-time employees the Award provided rates of pay expressed as an identified sum per week. Provision was made for some allowances (cl 3.6) and for such things as higher duties payments (cl 3.7). For part-time employees, the Award provided that they should be paid an hourly rate by dividing the weekly rate of the appropriate classification by 38 (cl 4.6(3)) but that, subject to agreement to the contrary by the employer and a specified union official, a part-time employee was to be employed for not less than 15.2, and not more than 32, "ordinary hours per week" (cl 4.6(1)). Employees, other than casual employees, were entitled to annual leave, certain statutory holidays and sick leave (Pt 5). ... shall be entitled The Award provided (cl 3.5(1)) that, in addition to the rates of pay it prescribed, "eligible employees to Occupational Superannuation Benefits, subject to the provisions of this clause". An eligible employee was defined as "any employee who has been employed by the employer during 5 consecutive weeks and who has worked a minimum of 50 hours during that period" (cl 3.5(3)(b)). The definition went on to provide that, after completion of that qualifying period, superannuation contributions were to be made in accordance with cl 3.5(2) "effective from the commencement of that qualifying period". Clause 3.5(2) of the Award dealt with the subject of employers' superannuation contributions, and it did so under seven headings: Amount, Regular Payment, Minimum Level of Earnings, Absences from Work, Other Contributions, Cessation of Contributions and No Other Deductions. It is as well to set out the full text of two of those provisions – those dealing with Amount and Minimum Level of Earnings. Clause 3.5(2) provided: Hayne "(a) Amount – Every employer shall contribute on behalf of each eligible employee as from 20 November 1989 an amount calculated at 3% of the employee's ordinary time earnings, into an Approved Fund as defined in this clause. Each such payment of contributions shall be rounded off to the nearest ten (10) cents. (c) Minimum Level of Earnings – No employer shall be required to pay superannuation contributions on behalf of any eligible employee whether full time, part time, casual, adult or junior in respect of any week during which the employee's ordinary time earnings, as defined, do not exceed 35% of the Guaranteed Minimum Wage for the Southern Division, Eastern District, as declared from time to time." Two features of those provisions should be noticed. First, on its face, cl 3.5(2)(a) required that the amount of which it spoke was to be calculated by taking 3 per cent of "the employee's ordinary time earnings". It therefore assumed that the employee's "ordinary time earnings" was an amount of money. Secondly, cl 3.5(2)(c) assumed that an employer may be required to pay superannuation contributions on behalf of casual employees, but only in respect of a week during which the employee's "ordinary time earnings" exceeded a certain amount. (The qualification sheds no light on what is meant by "ordinary time earnings". It threshold which must be passed before superannuation simply sets a contributions must be made for a casual employee. It does not say how the threshold is calculated.) "Ordinary time earnings" was defined in the Award (cl 3.5(3)(d)) as: "the actual ordinary rate of pay the employee receives for ordinary hours of work including shift loading, skill allowances and supervisory allowances where applicable. The term includes any over-award payment as well as casual rates received for ordinary hours of work. Ordinary time earnings shall not include overtime, disability allowances, commission, bonuses, lump sum payments made as a consequence of the termination of employment, annual leave loading, penalty rates for public holiday work, fares and travelling time allowances or any other extraneous payments of a like nature." Three features of this definition should be noted. First, it spoke of the "rate of pay the employee receives" for ordinary hours of work. Secondly, it expressly included within its meaning "casual rates received for ordinary hours of work". Thirdly, it expressly excluded from its meaning overtime and penalty rates for public holiday work. Hayne The references in that definition to rates of pay are awkward. As pointed out earlier, the expression "ordinary time earnings" was used in the provision which required an employer to make superannuation contributions in a context which assumed that "ordinary time earnings" was an amount of money, not a rate of pay. The definition of "ordinary time earnings" spoke of the actual ordinary rate "the employee receives" and of "casual rates received". Those references to receiving a rate invite attention to payments made, rather than figures used in calculating how much should be paid. But what the definition may be thought to assume, rather than state, is that the amount received was to be computed by reference to not only a rate of pay (expressed as money per unit of time) but also the relevant number of units of time that had been worked. The definition did not state expressly that account was to be taken of the number of units of time worked. It said that "ordinary time earnings" was the actual ordinary rate of pay the employee received for ordinary hours of work. But the words "for ordinary hours of work" can be understood as doing no more than describing the rate of pay that was to be taken into account. The ordinary hours of work were prescribed by the Award. They were to be an average of 38 hours per week (cl 4.1(1)(a)) to be worked on not more than five consecutive days in a week, Monday to Saturday inclusive (cl 4.1(1)(b)). Subject to some qualifications and exceptions not now relevant, these hours were to be worked between 6.30 am and 6.30 pm from Monday to Friday and between 6.30 am and 12.30 pm on Saturday (cl 4.1(1)(b)(i)). Subject to agreement to the contrary by employer and employees, ordinary working hours were not to exceed eight on any day and in no case could exceed 10 (cl 4.1(1)(f)). The Award also provided for overtime payments. It required that "all work done outside or in excess of the ordinary working hours on any day" was to be paid at time and a half for the first three hours and at double time thereafter (cl 4.2(1)). It was said that "[s]uch payments shall be in addition to the actual or ordinary weekly wage paid to each employee" (cl 4.2(1)). All work done on Sundays was to be paid at "double time in addition to the ordinary weekly wage paid to each employee" (cl 4.2(2)). Ordinary hours worked by employees, other than casuals, on a Saturday between 6.30 am and 12.30 pm were to be paid at time and a quarter (cl 4.1(1)(b)(ii)). Superannuation contributions for Relay Officers Relay Officers, employed by the appellant as casual employees, who worked outside ordinary working hours, were paid at rates calculated in accordance with the overtime provisions of the Award. Thus, if a Relay Officer worked on a Sunday, he or she was paid at double the rate payable for work the employee did between 6.30 am and 6.30 pm from Monday to Friday. The appellant had made superannuation contributions for its Relay Officers only in respect of hours which those employees worked which were not hours paid at overtime rates. The respondent assessed the appellant to a superannuation Hayne guarantee charge on the basis that the Award had required the appellant to make superannuation contributions calculated as a percentage of all earnings of the Relay Officers, regardless of whether those earnings included amounts paid at rates prescribed by the overtime provisions of the Award. The primary judge concluded that the appellant had complied with the Award. As I have noted earlier, the Full Court adopted an intermediate position. It considered that the Award required the appellant to make superannuation contributions calculated as a percentage of an amount derived by multiplying the rate at which the employee was entitled to be paid for work within ordinary working hours by the number of hours that employee actually worked, regardless of whether some or all of those hours fell outside the ordinary hours prescribed by the Award. The Full Court said that only the increment in the rate paid for work outside normal working hours was an overtime payment59. This increment did not attract superannuation contributions. The Full Court said that the construction which it adopted "achieve[d] compatibility between the positions of full-time, part-time and casual employees"60. In the Full Court's view61 there was "nothing in the definition in cl 3.5(3)(d) which would exclude from 'ordinary time earnings' that portion of casual employees' remuneration for working in overtime periods to which they would have been entitled if they had not worked 'outside or in excess of' ordinary working hours". Construing the Award It may readily be accepted that, as the appellant submitted, in construing an industrial award, it is necessary to recognise that the award will have been made in settlement of an industrial dispute and will reflect compromises that have been reached to effect that settlement. The Award in this case is, then, not to be construed as having created obligations intended to be wholly for the protection or benefit of employers, or of employees or of the organisations which represent them62. Further, if, for any reason, particular provisions of an award are thought not to achieve a desired or desirable end, it is open to a party to the award to seek its amendment. It would, therefore, be wrong to approach the task of construing this Award from an assumption that its superannuation provisions were intended to benefit all classes of employees or to benefit all classes of employees equally. It would also be wrong to strain the words of the Award to 59 (2001) 48 ATR 426 at 432 [24]; [2001] ATC 4730 at 4735. 60 (2001) 48 ATR 426 at 432 [25]; [2001] ATC 4730 at 4735. 61 (2001) 48 ATR 426 at 432 [26]; [2001] ATC 4730 at 4735. 62 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 426 per Brennan CJ, Hayne achieve some result that might be considered fair or desirable according to some a priori standard of fairness or proper employment practice. To do that would ignore the very real significance which should be attached to the fact that the terms of an award will usually reflect compromise. Nonetheless, the Award must be given a construction that not only accords with the language which the parties or the relevant industrial tribunal have used to express the rights and obligations of the parties, but also gives sensible work for them to do. The central provisions to be construed are cl 3.5(2)(a), which prescribed the amount of the superannuation contribution, and cl 3.5(3)(d), which defined "ordinary time earnings". No doubt they must be construed in the light provided by the overtime provisions of the Award but I do not consider that the question presented in this matter is to be expressed as what hours worked by a Relay Officer were ordinary hours as distinct from overtime. Ordinary hours of work were defined by the Award. The references to "casual rates received for ordinary hours of work" (cl 3.5(3)(d)) and to "ordinary hours worked by all employees, excluding casuals, on a Saturday" (cl 4.1(1)(b)(ii)) make plain that the expression "ordinary hours of work" was intended to operate in relation to casuals. To ask what hours worked by a Relay Officer were ordinary hours, or to ask what were the ordinary hours of work of a casual employee, distracts attention from the central provisions. The question which those provisions present is: what multiplier was to be applied to the actual ordinary rate of pay (or, in the case of a casual employee, to the casual rates received) for ordinary hours of work, to arrive at the amount on which the appellant's superannuation contributions were to be calculated under the Award? Was it a multiplier which was the number of hours that the Relay Officer worked, or was it only the number of hours that the Relay Officer worked during ordinary working hours? Of those two constructions, I prefer the former. The respondent's contention that the Award required the appellant to make superannuation contributions on all sums paid to Relay Officers, regardless of whether the earnings included amounts paid at overtime rates should be rejected. The respondent's contention, which lay at the heart of its cross-appeal, depended upon the proposition that every hour a Relay Officer worked, as a casual employee, was for that Relay Officer an ordinary hour of work. Perhaps that might be so if the expression "ordinary hours of work" were not defined in the Award. But once account is taken of that definition when construing the expression "casual rates received for ordinary hours of work" in the definition of "ordinary time earnings", the respondent's contention must be rejected. The reference to rates of pay combined with "for ordinary hours of work" requires the conclusion that the rate in question was the rate which was to be paid to the employee concerned for work done during the periods defined as "ordinary hours of work" in the Award. It was that rate which was to be used in calculating "ordinary time earnings", not the several different rates derived from that basic rate and used, for example, in calculating the payments to be made for work Hayne outside normal working hours. It follows that the respondent's cross-appeal should be dismissed. The Award obliged the employer to make superannuation contributions calculated as 3 per cent of a casual employee's ordinary rate of pay multiplied by the number of hours actually worked by that employee. There are several reasons for preferring this construction of the Award. ... entitled to as "eligible employees First, and perhaps most significantly, casual employees were what the to Occupational Award referred Superannuation Benefits" if they were employed during five consecutive weeks and worked a minimum of 50 hours during that period. Even if all of the 50 hours that a particular casual employee worked had been worked outside to Occupational normal working hours, Superannuation Benefits. No doubt that entitlement was, as cl 3.5(1) said, "subject to the provisions" of that clause. But stating the qualification by reference to hours worked, rather than ordinary hours worked suggests, and suggests strongly, that what was seen as important, in the case of a casual employee, was how much work had been done, not when it was done. that employee was entitled Secondly, the tension in the definition of "ordinary time earnings" between the references to a rate of pay ("the actual ordinary rate of pay" and "casual rates") and the evident intention to prescribe an amount of money as distinct from a rate, is not resolved by fastening upon the expression "for ordinary hours of work" when used in the definition. In particular, the references to "for ordinary hours of work" ("the ... rate ... the employee receives for ordinary hours of work" and "casual rates received for ordinary hours of work") are to be understood as serving only to identify what was the relevant rate to be considered. The phrase "for ordinary hours of work" is not to be understood as identifying the periods which were to be taken into account when converting the rate to an amount. To understand that phrase as identifying the periods which were to be taken into account in calculating the amount of ordinary time earnings would treat the words "actual ordinary rate" (in the phrase "the actual ordinary rate of pay") as adding nothing to the definition. It would read the definition as if it said "[o]rdinary time earnings shall mean the pay the employee receives for ordinary hours of work". No doubt, it might be said, that to construe the definition in this way would do no more than resolve the tension earlier identified in a different way from the resolution I propose. It would treat "rate of pay" as synonymous with "pay". It is a construction which, having regard to the several considerations to which reference is made in these reasons, I would not adopt. Thirdly, although it might be said that the increased amount which any employee, whether full-time, part-time or casual, was to receive for working outside normal working hours was intended to be full compensation for that Hayne work, that contention assumes the answer to the question now being considered. Whether superannuation contributions were to be made in respect of hours worked outside normal working hours is not answered by asserting that overtime was full recompense for that work. Fourthly, the express exclusion of overtime from the definition of "ordinary time earnings" is consistent with construing the Award in the way I prefer. That exclusion would not be necessary if the only hours to be taken into account in computing "ordinary time earnings" were the ordinary hours of work which the employee performed. Nor would it have been necessary to say that the term "ordinary time earnings" included "casual rates received for ordinary hours of work" if, contrary to the conclusion I have reached, the expression "for ordinary hours of work", in the phrase "the actual ordinary rate of pay the employee receives for ordinary hours of work", was used to define the number and types of hours that were to be taken into account in calculating "ordinary time earnings". Finally, reading the Award in the way I have described means that the amount of superannuation contributions to be made in respect of casual employees did not depend upon whether the employee worked in or outside normal working hours. For the reasons given earlier, it is neither necessary nor helpful to decide whether that achieves "compatibility" with full-time and part-time employees if "compatibility" is intended to invoke notions of fairness or equality between classes of employees. It is, however, right to say that the construction I prefer does not lead to any significant discordance between the entitlements of those who were employed by the week (whether as full-time or part-time employees) and those whose employment could have been terminated at will. Perhaps more significantly, however, it is a construction which is consistent with those provisions of the Award that said that overtime payments were "in addition to the actual or ordinary weekly wage paid to each employee" and it reflects the differences between the terms on which casual employees were engaged and their pay calculated. By the Award, both full-time and part-time employees were to be engaged by the week. The ordinary working hours of full-time employees were fixed by the Award and, in the case of part-time employees by agreement with the employer. The weekly amount to be paid to full-time and part-time employees could, therefore, be determined before they undertook their work in any particular week. For part-time employees the calculation of an hourly rate of pay was an intermediate step in that calculation but it was no more than that. Casual employees, by contrast, were engaged by the hour. The amount which each would receive for a week's work depended entirely upon the number of hours they actually worked. The employer's superannuation contributions for full-time and part-time employees could, therefore, sensibly be fixed by reference to their weekly rates of pay. There is no discordancy with that arrangement to hold that, Hayne for casual employees, the determining elements of the calculation were their ordinary rates of pay and the number of hours actually worked. Both the appeal and the cross-appeal should be dismissed. There should be no order as to the costs of the proceedings in this Court.
HIGH COURT OF AUSTRALIA AND APPELLANT THE QUEEN RESPONDENT [2005] HCA 8 8 March 2005 ORDER Appeal dismissed. On appeal from the Supreme Court of Queensland Representation: K C Fleming QC with P E Smith for the appellant (instructed by Terry Fisher & L J Clare with M J Copley for the respondent (instructed by Director of Public Prosecutions (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Trial – Miscarriage of justice – Competence of counsel – Joint trial of accused – Whether counsel should have applied for a separate trial – Whether application would have succeeded – Whether accused disadvantaged by joint trial – Whether counsel failed to object to evidence of bad character – Whether counsel failed to advance alternative case – Whether accused deprived of a fair chance of acquittal. Evidence – Criminal trial – Character of accused – Failure to object to evidence of bad character – Whether objection would have succeeded – Whether evidence admissible for other purpose. Criminal Code (Q), ss 579B, 668E. GLEESON CJ. The appellant and a co-accused, Amanda Blackwell, were charged with a number of offences following the death, dismemberment, and burial of an infant. The co-accused was the mother, and the appellant was shown by the evidence to be the father. Following a joint trial, before a jury, the appellant was convicted of murder. The co-accused was convicted of manslaughter. The appellant was also convicted of improperly interfering with a corpse, and concealing the birth of a child. The co-accused was also convicted of concealing the birth of a child When first interviewed, and later before the trial, the co-accused provided the police with a number of inconsistent stories about the birth, death, and burial of the child, including accounts in which she accepted sole responsibility. However, in her evidence at the trial, the co-accused said that the appellant was the father of the child, that he was present at its birth, that he took the baby away after it was born, that she never saw the baby again, and that the appellant told her he had disposed of the body. The trial, and the appeals, were conducted on the basis that the only two people who could have been involved in killing the child and disposing of its body were the appellant and the co-accused. The acts were done by one or other or both of them. The appellant, when interviewed by police, denied being present at the birth of the child, or having any connection with the birth or death of the child, or with the disposal of the body. He gave no evidence at the trial. The cogency of the co-accused's testimony against the appellant was diminished by her previous inconsistent stories. Much was made of this, and the trial judge's directions to the jury contained appropriate warnings. Even so, the circumstantial evidence against the appellant was very strong. He was proved to be the father of the child. He was shown to have told many lies about the matter. He had a strong motive to conceal the birth. Most telling of all was the condition of the body, considered in the light of the appellant's experience as a butcher. This appears from the reasons of Callinan and Heydon JJ, and need not be elaborated. After having made an unsuccessful appeal to the Queensland Court of Criminal Appeal on the ground of alleged unreasonableness of the verdicts and errors in the trial judge's summing up1, the appellant then raised a claim that there had been a miscarriage of justice in that he was not tried fairly because of the incompetence of trial counsel. He was given special leave to pursue that claim in this Court. Upon examination, it has been shown to be without substance. 1 R v Ali [2001] QCA 331. The conduct of trial counsel was criticised on a number of grounds. It was complained that counsel failed to advance a particular theory of the case consistent with his client's innocence of the principal offence. The appellant had maintained, before trial, that he had absolutely nothing to do with the birth or disappearance of the child. That continued to be his case at trial. He gave no evidence, but that was the line pursued in cross-examination and address. Now it is said that trial counsel should have invited the jury to consider, as an alternative hypothesis, consistent with innocence at least of murder, that the appellant "had nothing to do with the death of the child but may have been involved with hiding the corpse". It is worth reflecting upon some of the implications of this theory. The appellant was a butcher, experienced in the removal of sexual organs from goats. The child's skilfully dismembered body had the sexual organs neatly removed. The only two people who could possibly have done that were the appellant and the co-accused. The co-accused gave birth in circumstances that left her weak and distressed. The objective probabilities made it very likely that it was the appellant who dismembered the body. The appellant had consistently denied any involvement. Pursuit of this new theory would require that it be put in cross-examination to the co-accused, and in address. Presumably the hypothesis would have been to the effect that the child was murdered by the co- accused but that the appellant, who happened to be present, although not being implicated in the death of the child, took the body away, butchered it, and buried it. This scenario lacks forensic appeal. It was contrary to everything the appellant had previously said. It was also contrary to the principal line of defence pursued at trial. It was unsupported by any evidence. It could well have been regarded as utterly fanciful. We do not know counsel's instructions from the appellant. We do not know when, or why, a decision was made that the appellant would not give evidence. We do not know what counsel might have brought down upon his client's head had he set out, in the course of the evidence, to lay the foundation for such an hypothesis. If he had put it to the jury without first having put it to the co-accused, he would have exposed himself to devastating comment. How could he sensibly have put it to the co-accused, having regard to his principal line of defence? Furthermore, if such an argument had been advanced, the predictable reaction of the jury might well have been derision. It is not a mark of competent advocacy to pursue at trial every line of argument that can be imagined, regardless of its consistency with other arguments, and regardless of its prospects of success. On the contrary, such an approach is the hallmark of incompetence. This first argument for the appellant also illustrates a basic problem involved in attempts by an appellate court to pass upon the competence of counsel's conduct of a trial; a problem to which I adverted in R v Birks2 and (1990) 19 NSWLR 677 at 682-685. TKWJ v The Queen3. The adversarial system is based upon the general assumption that parties are bound by the conduct of their legal representatives. Furthermore, that conduct, usually, can only be evaluated fairly in the light of a knowledge of what is in counsel's brief, a knowledge that ordinarily is unavailable to an appellate court. An appellate court's speculation as to why a particular line was not pursued in cross-examination, or in address, will often be uninformed and fruitless. So it is in the present case. I can think of no good reason why trial counsel should have advanced the hypothesis in question. I can think of a number of good reasons why he might not have done so. Ultimately, however, I simply do not know. The argument that, because the hypothesis was not advanced, the appellant did not have a fair trial is hopeless. Next, the appellant asserted that evidence which was prejudicial to him was admitted at trial without objection. The detail of this complaint is considered in the reasons of Callinan and Heydon JJ, with which I agree. As those reasons demonstrate, most of the evidence was, in truth, admissible, although the use that could be made of it in the case against the appellant was strictly limited. There were, in effect, two trials being conducted together. Much of the evidence in question consisted of material relied upon by the co-accused in her defence. For example, evidence which tended to show that the appellant, to the knowledge of the co-accused, had a propensity to violence was relevant to part of her case. Her explanation of her original confessional statements, which she repudiated at trial, was that she was afraid of the appellant. The trial judge directed the jury as to the use they could make of the evidence. As to much of it, the contention that it should have been objected to does not withstand scrutiny. Furthermore, the record of trial counsel's final address to the jury reveals a tactical approach that explains why some of the evidence relating to aspects of the appellant's character was elicited in cross-examination or was not the subject of objection. Counsel depicted the appellant as an earthy type who had adopted Australian ways, who may have had some of the characteristics of a larrikin, but who would never do the things alleged by the prosecution. Some of the plainly admissible evidence inevitably was going to show that the appellant had a number of human failings. It was a justifiable forensic decision to go along with that, rather than to present to the jury an appearance of desperately attempting to resist the irresistible. Ordinary standards of professional competence do not require trial counsel to object to every piece of evidence that is arguably inadmissible, especially in front of a jury. The reception of inadmissible evidence, in a given case, might produce a ground of appeal, but it does not necessarily mean that there has been unfairness or a miscarriage of justice. (2002) 212 CLR 124 at 128 [8]. Some of the material described as prejudicial was of marginal significance only. It was argued, for example, that trial counsel, in cross-examination, "incompetently brought out the fact that the appellant was not a very good Muslim because he smoked, consumed alcohol and got drunk." There was plainly admissible evidence that the appellant had prostituted the co-accused, and threatened her with violence. The prosecution case, supported by strong circumstantial evidence, was that the appellant murdered an infant, dismembered the body, removed the sexual organs, and buried the remains secretly. Evidence that he was a smoker and a drinker, even if that was against his religion, was not likely to become prominent in the overall picture. The appellant and the co-accused ran cut-throat defences. There is nothing unusual about that. Counsel was criticised for not seeking a separate trial. There are two answers to the criticism. First, as Callinan and Heydon JJ explain, a joint trial was almost inevitable. Secondly, a joint trial had one significant tactical benefit for the appellant. It was important to the appellant's case that the jury should learn that the co-accused, in her original interviews with police, had accepted full responsibility herself, and had exonerated the appellant. It was at least doubtful that evidence of what the co-accused had said to the police would have been before the jury if the appellant had been tried separately. It is unnecessary for this Court to reach a decision on that hypothetical question, the answer to which may have depended on exactly how a separate trial was conducted. It suffices to say that there is a clear, rational explanation of why a separate trial might not have been sought. It is not to the point for the appellant to show that in certain respects the trial might have been conducted differently, or that in certain respects it might have been conducted more skilfully. Nor is it sufficient to show that some inadmissible evidence was received. Notwithstanding that her previous inconsistent stories made her evidence vulnerable to attack, the jury found the co- accused to be a convincing witness. (That is reflected in her conviction of manslaughter rather than murder.) There was, in addition, a strong circumstantial case against the appellant. He said nothing at trial, either to contradict the co- accused, or to explain away the damaging circumstances. Those are the reasons why he was convicted. The attempt to blame his counsel is misdirected. It has not been shown that the appellant, by reason of the conduct of his counsel, did not have a fair trial or that there was a miscarriage of justice. The appeal should be dismissed. 15 McHUGH J. This appeal should be dismissed for the reasons given by Hayne J. McHugh Hayne HAYNE J. The facts and circumstances giving rise to this appeal are fully set out in the reasons of Gleeson CJ and of Callinan and Heydon JJ. I need not repeat them except to the extent necessary to explain my reasons. For the reasons that follow, I agree that the appeal should be dismissed. Much of the argument on the hearing of the appeal proceeded from the premise that the determinative question was whether counsel who appeared for the appellant at trial had been flagrantly incompetent. To identify the issue in that way has at least two difficulties. First, there is an evident difficulty in giving content to the pejorative expression "flagrantly incompetent". Secondly, and more fundamentally, framing the issue by reference to the quality of trial counsel's conduct diverts attention from the question presented by s 668E of the Criminal Code (Q), namely, whether the Court of Appeal should have found "that on any ground whatsoever there was a miscarriage of justice". As McHugh J pointed out in TKWJ v The Queen4, "[t]he critical issue in an appeal like the present is not whether counsel erred in some way but whether a miscarriage of justice has occurred". The conduct of counsel remains relevant as an intermediate or subsidiary issue5 because the issue of miscarriage of justice in a case such as the present requires consideration of the two questions which McHugh J identified in TKWJ6. Did counsel's conduct result in a material irregularity in the trial? Is there a significant possibility that the irregularity affected the outcome? But the ultimate question is whether there has been a miscarriage of justice. In the present case, two complaints were made about trial counsel's conduct: (a) that trial counsel did not object to evidence which showed the appellant to be of bad character; and (b) that trial counsel should have applied for a separate trial. The first of these grounds was amplified by contending that trial counsel for the appellant failed to object to the form in which some evidence was led at trial and failed to object to the leading of evidence about some subjects at trial. (By contrast, in TKWJ, the issue concerned counsel's decision not to lead some evidence.) Other aspects of the conduct of trial counsel (for example, that some of his objections were said to be incomprehensible) appear to have been advanced as indicative of his incompetence. Beyond the forensic purpose of adding colour to the allegation made, these further allegations were not said to (2002) 212 CLR 124 at 149 [79]. 5 R v Scott (1996) 137 ALR 347 at 362; TKWJ v The Queen (2002) 212 CLR 124 at 149 [79] per McHugh J. (2002) 212 CLR 124 at 149 [79]. Hayne have affected what evidence was led at trial or the course that trial took. They may be put aside. to have the appellant As to the complaint that trial counsel for the appellant should have, but did not, seek the co-accused (Ms Blackwell) it is enough to say that I agree with Callinan and Heydon JJ that such an application, if made, would have failed. The prosecution contended, among other things, that the two accused acted in concert. In the circumstances of this case, joint trial of that issue, and thus joint trial of the two accused, was appropriate. This aspect of the matter may also be put aside. tried separately from As Gleeson CJ points out, an important consequence of the appellant being tried with the co-accused was that statements Ms Blackwell had made to police, in which she took full responsibility for killing the child and then cutting up the body, were before the jury. Had there been separate trials, those statements may not have been admissible at the appellant's trial7. The admission in evidence of these confessions did not disadvantage the appellant. It was said that trial counsel for the appellant could successfully have objected to some questions asked of witnesses by counsel for the prosecution and by counsel for Ms Blackwell. In some cases, it was said that objection could have been taken to the form of the question. In other cases, it was said that objection could have been taken to the relevance or admissibility of the evidence which it was sought to lead. Showing that objection could have been taken to some questions that were asked by other counsel during the course of a trial does not show that trial counsel was incompetent or show that there has been a miscarriage of justice. Counsel is not bound to take every objection that is open. Objecting to the form in which evidence is led, or objecting to evidence on a subject about which other evidence has been or is to be heard, may convey an impression of obstructionism detrimental to the interests of the party for whom counsel is appearing. Demonstrating that counsel could have objected to certain evidence does not demonstrate that counsel should have made that objection. Where it is alleged, as here, that there has been a miscarriage of justice because counsel did not object to the reception of evidence, it is necessary to exercise considerable care when considering whether counsel should have objected. There are at least two reasons why that is so. First, it is necessary to put aside the benefit of hindsight. Whether counsel not only could have but should have objected, must be judged, as far as possible, having regard both to the state of evidence at the time the question was asked and to what might then 7 Bannon v The Queen (1995) 185 CLR 1. Hayne reasonably have been expected to be the likely future course of the matter. So, in a matter like the present, it is necessary to take account of the possibility (perhaps even the then known probability) that the appellant would not give evidence on his own behalf. If it was possible, even probable, that the jury would not hear from the appellant, it would ill serve his cause to have the jury form the impression that he feared the facts of the matter being fully elicited. An appellate court does not and may not know what information trial counsel had when deciding whether or not to object to evidence. That is why, in TKWJ, I concluded that the question of miscarriage does not turn on a factual inquiry into why trial counsel acted or did not act in a particular way8. That kind of inquiry cannot be made. Rather, the question is whether there could be a reasonable explanation for the course that was adopted at trial. If there could be such an explanation, it follows from the fundamental nature of a criminal trial as an adversarial and accusatorial process9 that no miscarriage of justice is shown to have occurred. Secondly, when considering whether a failure to object to evidence has brought about a miscarriage, it is necessary to consider the effect of the evidence which it is said trial counsel could have had adduced in a different form or could have prevented being led. It is important to recognise that this question is separate from the question whether there has been any want of proper instruction of the jury about the use of the evidence led at trial, including the evidence which now is said should not have been before the jury. In the present case, therefore, one important premise to be accepted in considering the effect of the evidence which it is said should not have been led must be that the trial judge gave a proper separate consideration direction instructing the jury to differentiate between evidence relevant to the guilt of the appellant and evidence relevant to the guilt of the co-accused. In his notice of appeal, the appellant gave particulars of his complaint that trial counsel had failed to object to bad character evidence adduced concerning the appellant. Many instances were given of this alleged failure. Reference was made to particular aspects of evidence given by certain witnesses or about certain subjects. (2002) 212 CLR 124 at 159 [110]. 9 Ratten v The Queen (1974) 131 CLR 510 at 517 per Barwick CJ; RPS v The Queen (2000) 199 CLR 620 at 630 [22] per Gaudron ACJ, Gummow, Kirby and Hayne JJ; Azzopardi v The Queen (2001) 205 CLR 50 at 64 [34], 65 [38] per Gaudron, Gummow, Kirby and Hayne JJ. Hayne Some of those more particular aspects of evidence can be dismissed from consideration because they are evidently trivial. They include such matters as a passing reference in a recorded interview of the appellant by police to his then facing charges in the Beenleigh Magistrates Court about his butchery business and his denials (in that same interview) of instigating arrangements for Ms Blackwell to marry the appellant's nephew and receiving a gift to do so. Other instances of alleged failure to object to evidence must be examined having regard to the way in which the case for and against the co-accused was presented. Ms Blackwell had made several statements to police. In some of those statements she suggested that she alone was responsible for the death of her child; in others her account suggested that the appellant had done so. In some statements she said that she had cut up the child's body; in others she said, in effect, that she didn't know who had done this. The evidence she gave at trial was consistent with the prosecution case that the appellant had killed the child and then cut up the child's body. Her explanation at trial for the changes in her version of events was that she was terrified of directly implicating the appellant. The appellant contends that his trial counsel should have objected to evidence being given of Ms Blackwell's out of court statements showing (so Ms Blackwell contended) both that she did fear the appellant and that she had cause to do so. Those out of court statements were an integral part of the statements which Ms Blackwell had made to police. The statements she had made to police were relevant and admissible in evidence against her because they contained admissions by her. Those parts of the statements which were self-serving of her interests were not to be excised10. Any objection to this evidence by trial counsel for the appellant would have failed. Further, as the trial judge was at pains to point out to the jury, more than once, what Ms Blackwell said in her statements to police was not to be used as evidence against the appellant. The reception in evidence of what Ms Blackwell had said in her police statements about the appellant brought about no miscarriage of justice. It must then be recognised, however, that it was open to counsel for Ms Blackwell to attempt to buttress his client's case by attempting to elicit evidence that would show that his client's stated grounds for fearing the appellant were well founded. It is those attempts which form by far the largest group of questions to which the appellant submits his trial counsel should have taken objection as revealing the appellant's bad character. 10 R v Higgins (1829) 3 Car & P 603 at 604 [172 ER 565 at 565]. Hayne The evidence adduced by Ms Blackwell's counsel tended to show that Ms Blackwell was scared of and dominated by the appellant, that the appellant had not only had a long established sexual relationship with her but had prostituted her for his own gain and gratification, and that the appellant had been violent towards her and others. In the context of the issues fought at the trial of the appellant and Ms Blackwell, and having regard, in particular, to the statements Ms Blackwell had made to police, all of this evidence was relevant for purposes other than demonstrating that the appellant was a man of bad character. Thus, counsel for Ms Blackwell asked police officers who had interviewed her several questions that might be understood as designed to demonstrate that what Ms Blackwell had said about the appellant and his conduct to her and to others was true. For the most part, this evidence did no more than repeat what Ms Blackwell had said in her statements to police. Often the questions that were asked by Ms Blackwell's counsel about these matters were merely the preface to other lines of questioning. The reception of this evidence made no significant addition to the evidence the jury heard. In some other cases, counsel for Ms Blackwell asked witnesses about out of court statements that the appellant was alleged to have made. Again, these statements tended to portray the appellant in a bad light. All these out of court statements by the appellant may, perhaps, have been understood as either making some admission against the interests of the appellant or as having some relevance for the fact that they were made. It is not necessary to reach a concluded view about whether that impression of the evidence is accurate. In other cases, counsel for Ms Blackwell asked witnesses about threatening or violent conduct of the appellant. In particular, some questions were asked of a witness, Mr Mobeen Ali, about an altercation at a New Year's Eve party and about threats the appellant was supposed to have made to him. This examination was directed to showing that Mr Mobeen Ali feared the appellant. Again, that line was taken in order to explain why Mr Mobeen Ali had made statements to police which might have suggested that he, not the appellant, was the father of Ms Blackwell's child. And if that were so, it would be Ms Blackwell rather than the appellant who, of the two persons on trial, might be thought to have some motive to kill the child. Cross-examining Mr Mobeen Ali before counsel for the appellant, counsel for Ms Blackwell had to deal with the statements the witness had made to police lest contrary evidence be elicited by counsel for the appellant putting the witness's prior inconsistent statement to him. Ms Blackwell's counsel also asked questions of a police officer about allegations by a former employee of the appellant that the appellant had held him over a butcher's block and threatened him. This evidence came out in cross-examination about transcripts of intercepted conversations of the appellant recorded by a listening device. The police officer was asked about what the appellant had said when the appellant was apparently recounting a suggestion that he not only had threatened someone else but also had cut up the body of the Hayne deceased child. Like some of the other evidence earlier described, the appellant's statements, recounted in evidence, might have been understood as admissions against interest by the appellant or as relevant for the fact they were made. But again it is not necessary to reach a concluded view about whether that is so. What is of critical importance is that the jury had in evidence before them both the tapes of the intercepted conversations in which the appellant made the statements which counsel for Ms Blackwell explored, and transcripts of those tapes. It is not necessary to examine in any greater detail the other matters of evidence upon which the appellant relied in this appeal. For present purposes, what is important is that none of the evidence which the appellant now says that his trial counsel should have attempted to have excluded was evidence that created any new issue for the jury to consider, or put before the jury any information of any importance which otherwise would not have been before them. I do not find it necessary to reach any concluded view about whether trial counsel for the appellant acted incompetently at the trial. I tend to the view that criticisms of his conduct which may now appear to have some foundation might be capable of deflection on the basis that to appear to obstruct the course of evidence would have damaged what little chance the appellant may have had of securing an acquittal. If trial counsel's conduct of the trial does merit criticism, any irregularity which occurred in the trial was immaterial and there is no possibility that it affected the outcome. Finally, the appellant's notice of appeal alleged that the trial judge had failed to direct the jury "as to the permissible use to be made of the bad character evidence". This point was not developed in written or oral argument. No direction on this subject was sought at trial. It is entirely possible that the point was thought sufficiently met by the separate consideration direction given to the jury and that to seek more explicit direction would have emphasised the absence of any sworn evidence from the appellant. The appeal should be dismissed. CALLINAN AND HEYDON JJ. The only ground of appeal in this case is that, during his trial, which was a joint trial, for murder, of improperly interfering with the corpse of a female infant, and of concealing her birth, of all of which he was found guilty, the appellant's counsel was flagrantly incompetent. The facts The appellant, his wife, their young child and Amanda Blackwell, a young woman of about 20 years of age, (the "co-accused") lived in the same household at Logan Village near Brisbane for about two years. The appellant and the co- accused frequently engaged in clandestine sexual intercourse during this period. The appellant raised and slaughtered goats, poultry and pigeons on the property where they lived. He is a Muslim butcher, experienced in the dismemberment of the corpses of animals and the removal of their sexual organs. He sold the meat from the animals that he butchered as Halal meat to other Muslims. He also worked on occasions as a taxi-driver. On or about 7 or 8 September 1998, the co-accused gave birth to a female infant. Testing of samples of DNA pointed to the appellant as the father. Minutes after her birth the infant died from multiple injuries to her body and head of an extremely violent kind. Her umbilical cord was also torn soon after her birth. Not long after the termination of her short life, the child's body was dismembered by a person experienced in the dismemberment and dissection of bodies. Severed organs including part of the reproductive organs were discovered near the appellant's house. The upper section of her torso was found in a shallow grave on an adjoining property. The dismemberment had been done by a sharp instrument or instruments. The torso was severed just above the umbilicus, and the right leg just above the knee. A forensic pathologist gave evidence at the trial that the removal of the reproductive organs was most unusual. His opinion was that their precise severance implied the purposeful use of a sharp instrument, and a degree of anatomical knowledge. He described the severance as "remarkably neat". The appellant was adept at doing this to female goats to misrepresent their sex in order to achieve higher prices from potential purchasers of the meat. No preparations had been made in the household for the birth and rearing of a baby. The case against the appellant was that he personally killed the baby, or aided or counselled or procured11 the co-accused, with whom he was jointly tried, to do so. During the investigation of the crimes the appellant told many lies to the police officers and others: that he had not known that the co-accused was pregnant; that he had not been in a sexual relationship with her; that he possessed no particular ability to remove the sexual organs of animals; and that he had not slaughtered goats. He also lied about his presence on 8 September 1998 on his neighbour's property where the torso of the child had been buried in a shallow grave. The co-accused gave a number of different and conflicting accounts to investigating police officers of her role in the events leading to the baby's death. At first she denied that she had recently been pregnant but later she said that she had given birth to a stillborn baby whose body she had left at the rear of the appellant's residence. On another occasion she said that she had killed the baby, and had cut the body into pieces and buried them. She retracted the latter part of this admission very soon after she made it. She also admitted to a long sexual relationship with the appellant. In another interview some months afterwards, she told the investigating officers that the appellant had taken the child from her while it was still alive, and had carried it away. There was also a deal of evidence that the appellant dominated and manipulated the co-accused who became accustomed to doing as he demanded. His demands included that the co-accused submit to sexual relations with him whenever he wished, that she become engaged to be married to a nephew of his, Mobin Mukhtar Ali, who lived in Fiji, that she have sexual relations with other men for money, and that on occasions intercourse with them take place in the appellant's presence. The investigation into the crimes was a prolonged one. The co-accused's mother and police officers became concerned for the co-accused's safety soon after it began. The latter installed a listening device in the appellant's house in 11 Section 7 of the Criminal Code (Q) relevantly provides: "(1) When an offence is committed, each of the following persons is deemed to have taken part in committing the offence and to be guilty of the offence, and may be charged with actually committing it, that is to say - (d) any person who counsels or procures any other person to commit the offence." which the co-accused continued to reside after the death of the child, and recorded a number of the appellant's conversations. The appellant too recorded some conversations at the house between the co-accused, himself and his wife. The contents of these were canvassed during the trial. The police also conducted an interview with the appellant which was video-taped. The trial At the trial before Wilson J and a jury, the co-accused gave evidence after a formal admission on her behalf was made that she and the accused had been in a sexual relationship for almost two years. Her evidence was that an earlier pregnancy had resulted from it in 1997 and that the appellant had assisted her to arrange for the foetus to be aborted at a clinic. Unbeknown to the appellant, the co-accused cancelled her appointment at the clinic and she eventually miscarried. When the appellant found out about the pregnancy with which this case is concerned he told her that she would have to "fix it". The co-accused said that she went into premature labour more than 24 hours before the birth. She told no-one of this. The actual birth occurred near a tank stand on the appellant's property at night time more than a day later. She tried to tear the umbilical cord. Either then, or very soon afterwards, the appellant was present. He took the baby and forbade the co-accused to follow him. When subsequently she asked the appellant what had happened he told her that the baby was a boy, that the child had died and that he had fixed everything. As to her earlier different versions, the co-accused's final position was that her confession of infanticide and dismemberment of the body was false. She knew that she had to try to explain the baby's injuries. She was scared of the appellant. The co-accused was convicted of manslaughter and of concealing the birth of her child. The appellant did not give evidence at the trial. The appeal to the Court of Appeal of Queensland The appellant's appeal to the Court of Appeal of Queensland (McMurdo P, Davies and Thomas JJA) was dismissed. The only ground of appeal there was that the verdict of murder was unsafe and unsatisfactory. No point was sought to be taken that incompetence of counsel had deprived the appellant of a fair chance of acquittal. The appeal to this Court In this Court where he is represented by other counsel, the appellant has sought to identify numerous instances of incompetence on the part of trial counsel. It will be necessary to deal with each of these in turn. The first complaint relates to the introduction into evidence of a videotape of an interview with the co-accused by police officers on 17 December 1998. Trial counsel, having told the Court that a lot of it was prejudicial to the appellant, said "[i]t is not my position really to object." He made no applications to exclude portions of it, or for a separate trial despite the fact that, as it was submitted, there was inadmissible and prejudicial material on the tape, and even though in its entirety the tape was admissible against the co-accused only. Separate trials? Any application for a separate trial would have been doomed to failure. Section 597B of the Criminal Code (Q) confers a discretion on the trial judge, at any time during the trial of two or more persons, as here, charged in the same indictment, that the persons charged be tried separately. The events leading up to the murder and dismemberment of the infant, and the guilt or innocence of the appellant and the co-accused, were closely interconnected. Their relationship, their similar motives, their almost equal opportunity to commit the crimes, and their capacity, either separately or jointly to commit them, all argued very strongly in favour of a joint trial. There were no special or other features of the case requiring that they be tried separately. That one might seek to incriminate the other, as each accused here did, could provide no justification for a direction that the appellant and his co-accused be tried separately12. A joint trial of the appellant and the co-accused served to give the jury the means of obtaining a conspectus of the respective roles of each of them in the crimes with which they were charged. Statements by the co-accused The police interview of the co-accused on 17 December 1998, made as it was, out-of-court, was hearsay and not admissible in evidence against the accused. It was concerned principally with the sexual relationship between the appellant and co-accused in the period immediately leading up to the birth and certainly did indicate that the appellant would have been aware of the pregnancy. Another matter the subject of the interview was that the appellant had on occasions been violent towards the co-accused. These matters, taken with the rest of the statement, were relevant to the co-accused's role and admissible against her even though they were also apparently inculpatory of the appellant. Their reception into evidence in a joint trial could not be challenged. It was for the trial judge to deal with them by appropriate directions and warnings. The warning to be given in cases of this 12 R v Palmer [1969] 2 NSWR 13. kind must depend upon the facts of the particular case. The nature of the warning, the detail to which the trial judge should descend in giving it, and indeed, whether in some cases it should be given at all, are matters susceptible of no universal rule except that the interests of justice must be kept in mind and maintained13. No complaint is made in this case of any defect in the warnings and directions. And nor could there be. The trial judge on several occasions told the jury in unmistakable language that they should disregard this and like evidence so far as the appellant was concerned. At the trial, counsel correctly said that the facts recorded in the interview were prejudicial to his client. He did then object on grounds of irrelevance to some references during the interview to the appellant's medication. He also sought to object on the basis that the prejudicial effect of the matter and the language in which it was expressed upon the appellant outweighed its probative value. Next he raised the possibility of the exclusion of some of the material. Apart perhaps from specifying in detail the material which might arguably be excisable, and stressing to the trial judge the need for careful directions, there was nothing further that he could do. Specification of arguably excusable material would have been futile, as the whole of it was relevant to the case against the co-accused, and counsel did in fact request further directions from the trial judge. After pointing out that she had already done this twice, her Honour undertook to do it again. The argument with respect to trial counsel's treatment of the tape of the interview should therefore be rejected. Objections not taken The appellant then listed a large number of complaints to the effect that trial counsel failed to object to evidence when he should have, or otherwise acted incompetently in the course of the trial. It is convenient to summarize and number the instances referred to by the appellant as follows: (1) a hearsay statement by the investigating police officer, as to another woman who ceased to work for the appellant because of the appellant's, unspecified, conduct towards her; (2) cross-examination about the appellant's temper and that the appellant had made a number of threats against a police officer; (3) cross-examination about the appellant's having been recorded as making a highly offensive remark about the investigating police officers; (4) cross-examination to the effect that the appellant had tried to have the co-accused perform sexual acts in the presence of a neighbour and of the appellant's procuring for her; (5) cross-examination that the appellant told the co-accused to abort the earlier pregnancy and of his making the arrangements for an abortion; (6) evidence from the witness Mobeen Iftikar 13 See discussion by Toohey J (Mason CJ and McHugh agreeing) in Webb v The Queen (1994) 181 CLR 41 at 92-95. Ali that the appellant proposed that the co-accused marry his nephew, Mobin Mukhtar Ali, who lived in Fiji; (7) evidence from another witness that he saw the appellant and the co-accused engaging in sexual relations despite the fact that there had been a formal admission of those relations; (8) further evidence that the appellant procured men to have sexual intercourse with the co-accused for amounts of $30 to $50; (9) a question by the co-accused's counsel to a police officer: "Can I suggest you informed her mother of that, you told her mother, that is Helen Blackwell, that 'Amanda is obviously scared that I have told her that. If we can guarantee to put Raymond away would she tell us the truth?'"; (10) the co-accused's mother's evidence that the appellant followed her around when he was driving a taxi. It was next submitted that trial counsel could, and should have objected to a number of matters put to the witness Mobeen Iftikar Ali; (11) in particular some leading questions which caused the trial judge to direct the prosecutor not to lead; (12) again, the witness' awareness of sexual intercourse between the co- accused and the appellant; (13) evidence that the appellant called and told him that police officers would speak to him; (14) evidence that the appellant was violent and that he (the witness) was frightened of him; (15) cross-examination of the witness suggesting that he had seen the appellant assault a man at a New Year's Eve party; (16) that the appellant had a bad temper and had made threats to the witness; (17) and that the witness had sexual relations with the co-accused on two occasions while the appellant watched. The appellant then submitted, with respect to another witness, a police officer, Detective Hutchinson, that trial counsel did not seek, when he should have, to exclude the following matters which were captured on a video recorded interview of the appellant: (18) that the appellant was charged with other matters in the Magistrates Court; (19) double hearsay that the appellant had made arrangements for the marriage of the co-accused (which was denied by him); (20) double hearsay that the appellant received a gift to arrange the marriage (which was denied by him); (21) cross-examination out of court of the appellant by police officers; (22) questioning of the appellant by police officers about pornographic films; (23) the tender of a box of knives (without the identification of any of them as a relevant weapon); (24) an offensively expressed refusal to provide a sample to a police officer, and the cross-examination on that topic; and a police officer's opinion evidence that the co-accused's confession was untrue; (25) evidence that the appellant had said that he was writing a book, "How I Beat the Cops"; and (26) evidence that a witness, Gomes, had alleged that the appellant threatened to have his head chopped off by a band saw. (27) It was also submitted that the appellant's trial counsel should have made a timely objection to some exchanges between the co-accused's counsel and Detective Hutchinson: "Q: Now in the interview of the 27th that we heard yesterday, there was some talk, there was some questions about Lisa Kahn? Yes. She was a woman who was known to both Bronwyn and Raymond Ali previously? Yes. And who had spoken about Bronwyn being basically a chronic alcoholic? She did tell us that. And spoke about an incident that involved Raymond that she then said she was not going to tell anybody about it because of the fear of Raymond and specifically also Bronwyn wouldn't believe her." The trial judge then raised a question about the admissibility of the evidence. Only then did trial counsel demur. He said: "COUNSEL: Your Honour, you indicated that you would be directing the jury in relation to the evidence of cross-examination in relation to Bronwyn Ali, a particular part being hearsay – cross-examined by way of hearsay. I would be asking your Honour also to direct the jury in the same terms in relation to ... the allegation of Gomes and this band saw incident where Gomes says: 'Here Gomes says that Amanda witnessed that?' And he said: 'I think that's right.' I will be objecting to that. WILSON J: ... you really should make your objections at the time the evidence is led or about to be led. COUNSEL: I am well aware of that. I must say at the time of listening to the tapes all morning and – not that it is an excuse to be preoccupied, but I did not hear the way it was put by [counsel for the co-accused] and that is why I was – I was of a most urgent nature at lunchtime trying to get a copy of the transcript and this is the first available opportunity of being able to read it. WILSON J: Well, as I understood what was said after lunch on Friday Mr Gomes will, in fact, be called and will be giving that evidence directly and I had the impression that in the circumstance neither you nor the prosecution were concerned about this part of the evidence." Trial counsel continued: "What I discussed with my learned friend, your Honour, was Mr Gomes will be giving evidence, and I go a little bit further. Of course, the allegation of the band saw arises if the Crown calls Mr Gomes to give evidence and in cross-examination I cross-examine him on his credibility and truthfulness and go to the affidavit or statutory declaration that has been referred to and if I said to him, for instance, 'Well, you signed a statutory declaration or the affidavit', but it doesn't need to go that far. I can achieve the same by putting to Mr Gomes, for instance, 'Mr Ali reported you to the police on the basis of allegations that you stole from him and that's why you're upset', or continue on from there without having to prove that Mr Gomes did, indeed, commit a crime which is irrelevant. The basis of Mr Gomes – whether or not he actually stole meat and money off [the appellant] is irrelevant in this case. What is relevant is that Mr Gomes or [the appellant] made an allegation ... which the police investigated and [the appellant] was upset about the alleged theft and Mr Gomes is obviously upset about being reported to the police. I don't need to go to the affidavit material because Mr Gomes' alleged crime does not need to be made in this case." It should be pointed out that trial counsel did successfully object subsequently to an attempt by the co-accused's counsel to bring out that the appellant had not paid the wages of Gomes, a former employee. Incompetence in cross-examination (28) The appellant submitted that trial counsel incompetently asked a number of questions of the investigating officer of an obviously damaging kind. "Q: And [the appellant] was charged on a suspicion by yourself that he is involved. Not at all. That's what I'm putting to you because there was no particular piece of evidence to establish [the appellant's] involvement in the death of the child as in scientific physical evidence. Oh no, but in my experience there never is one piece of evidence that proves that a person is responsible. That's why we call [a] number of witnesses. That's why we have them and why we continue to. But you can't point, can you, the one piece of evidence you are relying on – to clarify it for you, it's completely a basis of circumstances in relation to [the appellant]? A: Well, we have to debate then what circumstances are and what I say is there are a number of witnesses who will be called, they will give evidence, they will produce exhibits and totally accepting all of the evidence that those witnesses give, it will show beyond reasonable doubt that Ali is responsible for the murder of his child. [The appellant] was charged eleven months after the death of the child? Yes. So something you say obviously changed between 7 and 8 September to the date of [the appellant's] arrest? the body was found, A: Well lots of things change. From then the body – the leg was found and then both accused were interviewed, witnesses were identified, statements were taken from those witnesses and slowly a body of evidence – well, your body of information increases and points toward various people and from all the evidence that we've collected now, I'm satisfied that the two people sitting in the dock are responsible for the murder of their child. See what I'm suggesting is you have no more evidence today than you did on the first occasion you went to [the appellant's] property. No, that's ridiculous. See, if I suggested to you that indeed you charged [the appellant] to make Blackwell feel secure and on that basis alone so she would feel secure and speak more freely to involve herself more, what would you say to that? No, I'd say that was foolish as well. [The appellant] was charged because we had, in my opinion, collected sufficient evidence to show he was responsible for the murder of his child as was Blackwell in that same position." The complaints considered We turn now to a consideration of each of the complaints. Some of them may be grouped together for this purpose. In doing so it is important to keep in mind the context in which each arises. (1) The complaint as to the first matter is well-made. The respondent, speaking of another earlier employee of the appellant asked this leading question and elicited this irrelevant and prejudicial answer: "Q: She left because of things – concerns she had about [the appellant's] conduct towards her? Yes, that's fair." We will consider the impact of this upon the trial in combination with the other complaints that the appellant has made out. (2) The second complaint has validity. The suggestion, not objected to, is that the appellant was of a violent disposition, in effect of purported propensity. It was adduced however during re-examination on a topic that had been opened up in cross-examination by both the appellant and the co-accused, that is as to the reasons for the co-accused's different accounts of the relevant events. In the event, the threats alleged were not ones which the person to whom they were made took seriously. No actual violence took place. In the circumstances any temporary adverse effect upon the appellant could be cured by a trial judge's directions. Accordingly it is not necessary to consider either the current application of R v Randall14 and Lowery v The Queen15 or their possible relevance to the co-accused's case in defence. (3) It is not possible to say that the evidence of the offensive remark, which was not only about the police, but also was directed to them, was necessarily irrelevant and inadmissible. The appellant was contending that the police were "out to get" him. He was recorded as saying that the body had been dismembered by dogs. These were at least arguably lies that he told when he was aware that his remarks might be recorded and heard by police officers. Evidence that he addressed a listening device was capable of constituting an admission that he knew that the officers were listening to, and could hear his false claims. (4), (5), (6) and (8) The evidence referred to in these instances was adduced in court during cross-examination of investigating police officers by the co-accused's counsel on a statement made to the officers by his client. It was relevant to the co-accused's defence. It tended to establish the appellant's callousness towards the co-accused, and the hold that he had upon her. The same 14 [2004] 1 WLR 56; [2004] 1 All ER 467. can be said of these other pieces of evidence: that the appellant had arranged for the abortion of a child earlier conceived by him with the co-accused; that he had arranged for the marriage of her to his nephew Mobin Mukhtar Ali; and that he had been a procurer for her at his insistence. This body of evidence was therefore potentially exculpatory of her, and could improve her chances of escaping a verdict of murder. It was relevant to matters contained in the co- accused's statements to the police, and could not in fairness to her have been rejected. Together with other evidence prejudicial to the appellant, it called for, and, as will appear, in fact attracted, a strong direction by the trial judge. (7) and (12) The fact that a formal admission of a matter relevant to an issue had been made does not mean that no evidence of it at all may be given, at least where the evidence goes beyond the admission16. Here, it was not simply the existence of the sexual relationship that was relevant: its duration, the imbalance between the parties to it, its relevance to motive, and its nature were all of significance, and bore closely upon the guilt or innocence of the appellant and co-accused. (9) The question to which this complaint relates was also put by the co- accused's counsel in cross-examination of an investigating police officer. Unless it was intended as, and could be justified as an attempt to put a prior inconsistent statement, it should not have been asked. But the answer to it stated no more than facts self-evident from other evidence and was not of itself damaging to the appellant: "What I was saying in a conversation with the mother that it was obvious that she was scared, that being that she had given birth, the details of how she'd given birth were sketchy at best because she wasn't telling the truth. The reason she wasn't telling the truth was open to a number of possibilities." Furthermore, the trial judge directed the jury that suggestions in questions asked which were not assented to did not constitute evidence and should be disregarded. (11) The appellant's contention with respect to the leading questions earlier referred to is correct but the impact of them in view of the trial judge's intervention was innocuous. 16 R v Raabe [1985] 1 Qd R 115 at 116 per Connolly J, 123 per Thomas J, 124 per Derrington J; cf R v Smith [1981] 1 NSWLR 193 at 195, permitting evidence whether it goes beyond the admission or not. (10), (12), (13), (14), (15) and (16) It was relevant to the case against the appellant that he had told Mobeen Iftikar Ali that the police would speak to him. That evidence, taken with other evidence, of his relationship with the appellant, tended to show that he was concerned to ensure that Mobeen Iftikar Ali say nothing that could be inculpatory of the appellant. Evidence was elicited from the co-accused's mother that the appellant had threatened her and that he had said that he "was the victim" and that had she been a better parent her daughter "wouldn't have turned out this way". The effect of the evidence that the appellant was following the co-accused's mother in his taxi-cab could at most be marginally relevant to show that the appellant had a guilty mind, and was attempting to threaten a potential witness against him, but it also might have been open to an inference that the appellant was a dangerous, generally malicious person. Other similar evidence, of threats, and the appellant's tendency to violence was given by Mobeen Iftikar Ali and others. This evidence should have been the subject of objection. (17) The appellant's presence during intercourse between Mobeen Iftikar Ali and the co-accused may have had some relevance to the appellant's domination of the co-accused. It could only have been of limited probative value and might have been excluded if the appellant's counsel had objected. Having regard however to the evidence of Mobeen Iftikar Ali of the appellant's attempt to have him accept responsibility for the pregnancy, it added little and was most unlikely to have caused any real prejudice to the appellant. (16) It was submitted that trial counsel should have objected to evidence of a telephone conversation between the appellant and Mobeen Iftikar Ali. The submission should be rejected. The evidence was probative of the appellant's state of mind, his motive and his wish to shift the responsibility for the pregnancy to Mobeen Iftikar Ali. The questions which were asked by the co-accused's counsel and the answers were as follows. They were relevant and admissible. "Q: Your uncle rang you and spoke to you before the police came to see you? Yes. Did he know that the police were coming to see you or warning you of that fact? Yes. He told you at that point, didn't he, that you ought to say that you were obviously the father of this baby? Yes." (18), (20), (22), (24) and (26) The references to other charges against the appellant in the Magistrates Court, the possibility of a gift to arrange the co- accused's marriage, pornographic films, the refusal to provide a sample, and threats to Gomes could and should have been excluded even though the effect of some of these would have been innocuous. The reference to other charges made clear that they related to the appellant's butchery. (19) The characterization of the matter the subject of this complaint, that the appellant had arranged for the marriage of his co-accused and Mobin Mukhtar Ali, as double hearsay is erroneous. The matter was suggested by a police officer and its source identified by him to enable the appellant to understand the detail of the questions that he was being asked. It was relevant to his motive and hold over the co-accused. It was, in any event, denied and not pursued. (21) There are a few passages in the questioning of the appellant verging on, but not quite reaching the stage of cross-examination. Some of the questions were invited by responses to answers, some of them lengthy, previously given by the appellant. Others were no more than legitimate explanations prefacing further questions. The evidence was not of a kind which the trial judge would have been likely to exclude in the exercise of her discretion. (23) Objection to the tender of the knives as exhibits would have been overruled. They were referred to in the course of the interview of the appellant which was conducted by police officers and which was properly in evidence. That knives of the kind were available to, and used efficiently by the appellant, provided evidence of opportunity and capacity to dissect the corpse. (25) Evidence that the appellant was obstructing the police officers in their investigation of crimes alleged against him was relevant and admissible. Taken with other matters it was capable of establishing that he was their perpetrator. (27) Trial counsel should have objected in a timely way as suggested by the trial judge to the evidence the subject of this complaint. Some of the evidence however with respect to the appellant's wife, and the fear in which she held the appellant, to the extent that the co-accused was aware of, and affected by these matters, may have been relevant to, and admissible as bearing upon, the co- accused's relationship with the appellant. Its precise relevance to that issue and its bearing upon the guilt or innocence of the appellant were matters for direction by the trial judge. It was inadmissible however, as the trial judge said, as similar fact evidence. (28) The cross-examination by trial counsel of the investigating police officer about the quantity and quality of the evidence upon which the respondent relied may have been ill-considered and could hardly be described as a triumph. But, as must already be apparent, the case against the appellant was a strong one. Opportunities for a forensic triumph of any kind in the course of it were scarce. The cross-examination may have had the forensic purpose of heightening the fact that aspects of the case against the appellant were circumstantial only, and of demonstrating an overzealousness on the part of the investigators. The fact that the purpose may not have been achieved does not mean that the questioning should be stigmatized as incompetent. The appellant contends that his trial counsel should have objected to, or even perhaps have applied for a new trial in respect of, references to topics already mentioned in this judgment which were made in the opening of the co- accused's case, or at least should have objected to the evidence upon which those statements were based when it was elicited. They were to this effect: that the appellant cajoled the co-accused into having sexual relations and prostituted her even when she was pregnant; that the appellant had been involved in a fight at a New Year's Eve party; that he had assaulted the co-accused, and threatened to kill her if she became pregnant, and that he had assaulted Gomes and threatened to cut his head off. The observations that we have already made with respect to these and related matters apply equally to the comments about them made in the opening and need not be restated, except to repeat that with the exception of the evidence concerning Gomes and the fight, they tended to establish motive, and the appellant's domination and manipulation of the co-accused. The appellant submits that there were nine occasions upon which trial counsel made incomprehensible objections. One of the instances was not, on examination, an objection, but part of a submission of no case. The others discernibly were, although they could no doubt have been articulated more precisely. They were essentially objections on grounds of irrelevance. They were not incomprehensible. The appellant submitted that trial counsel's incompetence could also be seen from his failure in cross-examination of witnesses for the respondent and the co-accused, to put relevant matters which "reflect[ed] [which we take to mean, putting or highlighting] the case theory" of which a number of examples were given. The first instance advanced is a passage in the cross-examination of the appellant's neighbour on whose property the shallow grave for the infant's torso was found. True it is that much of the cross-examination is inconsequential, but there was little that trial counsel could usefully put to this witness. Two matters that he did put were, that the soil was loose and soft, and that dogs and a fox were on the property on occasions. Affirmative answers to these questions could lay some foundation for propositions to be put to the jury in the appellant's closing speech, that the co-accused could easily have been able to dig the grave in which to place the remains of the baby, and that the appellant, as a strong male, could and would have been expected to dig a deeper one if he were responsible for the disposal of the body. So too, it was put, dogs or a fox could have disinterred and scattered parts of the body. Questions, the subject of complaint by the appellant, to a similar end, were also asked by trial counsel, not imprudently, of another witness, a police officer (Ms Brown). Questions about the straying of the appellant's goats on to the neighbour's property could also provide an explanation for the appellant's presence there at any material time. On any view, the neighbour, with whom the appellant had clashed before the trial, was a witness to be handled with some care. The next instance selected is of some cross-examination of Dr Naylor, an experienced pathologist who performed the post-mortem examination of the infant's remains. His evidence included this: "My opinion is that to remove [the reproductive organs] ... must have involved the purposeful use of a sharp instrument and probably also required some degree of anatomical knowledge." He added that practical experience in dissecting the structures would have been required. And later he explained his reasons for his opinion that the infant's life was viable at, and after birth, that the damage to the tearing of the umbilical cord would not have been fatal, and that the other injuries were the substantial cause of death. Two things may be said of this evidence. Given as it was by a highly experienced, disinterested expert, it was effectively beyond challenge. It was not evidence upon which any accused would wish a jury to dwell. All that could be done with it, and this would not have been without its risks, was to attempt to show that the dissection was not especially expertly performed, in order to found a later submission that the co-accused was capable by reason of her experience of doing it. This, it seems to us, was what trial counsel reasonably carefully tried to The appellant next referred to some further questioning of the police officer, Detective Hutchinson who interviewed the appellant and the co-accused. Trial counsel sought to make some capital out of something that the co-accused had told this witness. The trial judge intervened and counsel desisted. What happened in no way damaged the appellant and was of no significance. Dr Keeping was an experienced obstetrician and gynaecologist called by the respondent to prove that the umbilical cord would be difficult to remove by tearing alone, and that the loss of blood from even the complete removal of it, or tearing of it, would be unlikely to cause death. He also explained that it would be difficult for a person without experience in dissecting live creatures to do the dismemberment that was done here. Again, this was a witness to be handled with some care. Whilst it is true that trial counsel's questions did invite a repetition, by reference to this witness's evidence at the committal, of the prejudicial fact that the dissection was likely to have been done by a person of some practical knowledge and experience of anatomy, they also brought out that at an earlier time, the doctor had said that he had thought that a section of the uterus was an autopsy specimen, and accordingly, it might have been submitted, a result of something beyond the skill even of the appellant. Some benefit, arguably, it might be suggested, flowed from that questioning. In all of the circumstances of this long and difficult trial it is impossible to say that trial counsel incompetently chanced his arm with this witness, or failed to put something to him that he ought to have. Little can be more risky for a trial counsel than the cross-examination of a co-accused in a joint trial. In his submissions the appellant argued that trial counsel failed to put to the co-accused also, matters which "reflected the case theory." Trial counsel not surprisingly first took up with the co-accused the inconsistencies in her various accounts and her attempted explanations of her conduct. He then put to her that she had dismembered the body, and that she was well able to do this because of her experience in assisting the appellant when he butchered goats. He extracted an admission that the co-accused had observed and assisted in their slaughter and the removal of their organs. The appellant then brought out that the co-accused had done nothing in preparation for the rearing of an infant. He also established by his questions a possible motive for her to kill the baby, namely her hope and expectation of marrying Mobin Mukhtar Ali, a nephew of the appellant whom she had met in Fiji. Counsel then returned to some further inconsistencies in the co-accused's accounts of her involvement, and brought out that she had some knowledge of the anatomy of human beings. On one occasion the appellant put a matter, the different paternity of the child, that he should have, but had not put to the alleged father Mobeen Iftikar Ali who had earlier given evidence. On objection he withdrew the question. If the matter had been in any way critical he could have asked to be allowed to press it, and to seek the recall of the witness, if available, so that the matter could be asked of him. No doubt trial counsel was putting his instructions in relation to the paternity of the child, but in view of the DNA and other evidence, and of the long sexual relationship between the appellant and the co- accused, it would have been very difficult to put the matter with any conviction. To press the question may have been to emphasize to his disadvantage, the appellant's persistence in a falsehood. It follows from what we have so far set out that counsel for the appellant at the trial has not been shown to have been flagrantly incompetent in his conduct of the appellant's defence. It is true that he did make some errors but it would be wrong to describe them as flagrant ones. The conduct of a difficult criminal defence in an adversarial system is no simple matter. Sometimes it will be more prudent for counsel not to object than to object to evidence adduced on the other side. It may be that the point sought to be established could be proved in a more damaging way by other evidence. It may be that the evidence, if admitted, will produce an inconsistency with damaging evidence already led. It may also be that part of the inadmissible evidence will be helpful to the accused. To object repeatedly and unconvincingly can also irritate a jury. Considerations of these kinds may have influenced trial counsel here. It must be remembered that trial counsel has not been party to this appeal, and has had no opportunity to defend himself against the appellant's criticisms. What trial counsel did or did not do, could not have affected the result for the appellant here. It will frequently be difficult to make a confident judgment, after the event, of the actions taken and decisions made by counsel in the conduct of a long criminal trial before a jury. It is also difficult to make an assessment of the likely impact of them upon the deliberations of the jury. What may now appear obvious with the advantage of hindsight, may at the time have presented an entirely different, and on occasions, insoluble dilemma. Sometimes it may, not imprudently, seem to an advocate, better to abstain from objecting to only marginally or relatively innocuous, or barely credible evidence, even if technically it is inadmissible. Such a stance might be taken for tactical reasons: for example, not to be seen to be objecting to what is obvious, or will be proved by another witness or witnesses anyway, or which, if objected to, might suggest that the accused has something to hide, or might give the impression that counsel and whom he represents are being obstructive. These are tactical decisions, to be made, sometimes intuitively and on the basis of the client's instructions17, often upon an impression of a witness necessarily formed hurriedly, and having regard to the fluidity of any trial in which the outcome depends upon viva voce evidence. Decisions whether and how to cross-examine are not always easy. They are much more difficult when the trial is a joint one of those who once were close and now seek to escape conviction by blaming each other. And they are possibly most difficult, when, as here, the case against the appellant was an overwhelmingly strong one. It is in the light of these matters that the relatively few omissions and mistakes of trial counsel and their relevance to and effect upon the trial of the appellant have to be evaluated. The evaluation that has to be made is whether the conduct in question produced a miscarriage of justice, that is, whether it deprived the accused of a chance of acquittal that was fairly open. As Gaudron J in TKWJ v The Queen said18: 17 cf TKWJ v The Queen (2002) 212 CLR 124 at 150-151 [80]-[83] per McHugh J. 18 (2002) 212 CLR 124 at 133 [26]-[27] (footnotes omitted). "[W]hether there has been a miscarriage of justice is usually answered by asking whether the act or omission in question 'deprived the accused of a chance of acquittal that was fairly open'. The word 'fairly' should not be overlooked. A decision to take or refrain from taking a particular course which is explicable on the basis that it has or could have led to a forensic advantage may well have the consequence that a chance of acquittal that might otherwise have been open was not, in the circumstances, fairly open. One matter should be noted with respect to the question whether counsel's conduct is explicable on the basis that it resulted or could have resulted in a forensic advantage. That is an objective test." The appellant has not demonstrated that any conduct on the part of his counsel at the trial deprived him of a fair chance of acquittal. In saying that we would not want to be taken as suggesting that the fact that a case appears a strong one in any way diminishes the obligation of those conducting the trial to ensure that it is a fair one. Indeed the contrary is the case. One particular difficulty confronting the appellant here however was the fact that there was much independent evidence that falsified his assertions about relevant matters. It was quite open to the jury to regard them as lies told out of a consciousness of guilt. They included lies about his ignorance of the co-accused's pregnancy, his denial of a long sexual relationship with the co-accused, and his knowledge of anatomy. It has to be kept in mind that the appellant could have been found guilty of murder either because he inflicted the death blow or blows to the infant, or because he counselled or procured the killing by the co-accused. The former seems more probable for the reason that the force was "very substantial" and inflicted within thirty minutes of the birth which had caused the co-accused to lose a great deal of blood and to weaken her. The two other particularly telling features of the case against the appellant were his first denied and then proved skill and experience in dissection, and his motive, as a married man living with his wife and child, and in a clandestine affair which had produced a child, to kill and dispose of that child. With respect to the many complaints that trial counsel failed to object to evidence of what the co-accused said about him out of court, the problem for the appellant was that these were admissible against her either as lies told by her out of a consciousness of guilt, or as part of a statement or statements by her, which included matter which was capable of amounting to an admission against interest, and therefore required that the whole of the statement or statements be received. The trial judge relevantly instructed the jury that what the co-accused said out of court was not admissible on any account against the appellant. Her Honour also made it clear that questions asked were not evidence and required a positive response to be so. No suggestion was made by the appellant that these instructions were in any way defective or inadequate. So too, the trial judge told the jury several times that the cases against the appellant and the co-accused were separate cases requiring careful and separate consideration of them. Her Honour emphasized on no fewer than six occasions in her summing up that statements made by either of them out of court could not be used against the other. No criticism of her Honour's summing up, either in whole or in part has been made and nor could it have been. Not only did it include the instructions to which we have referred, but also it quite distinctly put the cases against and for the appellant and co-accused. This trial was long and difficult. The case which the Crown presented against the appellant was very strong. Such errors as may have been made by trial counsel in this long and difficult, but very strong case against the appellant were not egregious ones. They could have had very little or no impact upon the trial, and the jury's view of the appellant's guilt or innocence. Such impact, if any, as they may have had could only have been slight and temporary. That impact was capable of being cured, and was in fact cured, by the trial judge's careful and repeated instructions as to the use to which the different types of evidence could be put. The appellant was not deprived of a fair chance of an acquittal by anything done or omitted to be done by trial counsel. No miscarriage of justice occurred. The appeal should be dismissed.
HIGH COURT OF AUSTRALIA APPELLANT AND METROBUS RESPONDENT Kuligowski v Metrobus [2004] HCA 34 3 August 2004 ORDER Appeal allowed with costs. Set aside the orders of the Full Court of the Supreme Court of Western Australia dated 24 June 2002 and in place thereof order that: the appellant's appeal to the Full Court be allowed with costs; the orders of the District Court of Western Australia dated 18 October 2000 (in WC 93 D 775 of 1997 and CIV 4575 of 1998) be set aside and the matter remitted to the District Court for hearing; and the respondent pay the appellant's costs of the said District Court proceedings both before Deputy Registrar Harman and Commissioner Ley. On appeal from the Supreme Court of Western Australia Representation: B L Nugewela with G E Nairn for the appellant (instructed by D'Angelo & Partners) G T W Tannin SC with B P King for the respondent (instructed by State Solicitor's Office (Western Australia)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Issue estoppel − Whether decision of Review Officer under the Workers' Compensation and Rehabilitation Act 1981 (WA) ("the Act") Pt IIIA Div 3 is a final decision for the purposes of issue estoppel − Application by employer under s 60 of the Act disputing liability to pay compensation for injuries incurred at work − Review Officer found that the worker's injury had "resolved" − Leave to institute proceedings under s 93D of the Act for damages at common law refused on the grounds of issue estoppel. Issue estoppel − Whether the issues arising in District Court proceedings were the same issues decided by the Review Officer − Review Officer's findings were ambiguous. Words and phrases – "issue estoppel", "final decision". Workers' Compensation and Rehabilitation Act 1981 (WA), Pt IIIA and ss 5(1), GLEESON CJ, McHUGH, GUMMOW, KIRBY, HAYNE, CALLINAN AND HEYDON JJ. On 23 March 1994, the appellant bus driver, Marek Kuligowski ("the worker"), suffered injuries in an accident at work. These injuries included a twisted left ankle. The worker failed in workers' compensation proceedings against his employer, Metrobus, in the Conciliation and Review Directorate of Western Australia. He then obtained two orders from a Deputy Registrar of the District Court of Western Australia. The first order granted leave to the worker to institute proceedings in the District Court for damages at common law in relation to the injury. The second order dismissed an application by Metrobus that the worker's claim be dismissed. Those orders were then set aside by a Commissioner of the District Court who accepted a contention advanced by Metrobus that an issue estoppel arose from a decision in the workers' compensation proceedings. The Full Court of the Supreme Court of Western Australia, by majority1, dismissed an appeal from the Commissioner's orders, and the present appeal is brought, by special leave, against the Full Court's orders. The background After the accident of 23 March 1994, the worker missed a few days of work. On or about 22 December 1994, according to the worker, he suffered another accident at work, exacerbating the symptoms in his left ankle. The worker also claimed that in April 1995, while not at work, his left ankle gave way and he twisted his left knee, again causing an exacerbation of the symptoms in his left ankle and also causing symptoms in his left knee. Section 18 of the Workers' Compensation and Rehabilitation Act 1981 (WA) ("the Act") provided: "If a disability of a worker occurs, the employer shall, subject to this Act, be liable to pay compensation in accordance with Schedule 1." Two paragraphs of the definition of "disability" in s 5(1) are relevant: 1 Kuligowski v Metrobus (2002) 26 WAR 137 (Malcolm CJ, Steytler and Templeman JJ; Wallwork and McLure JJ dissenting). a personal injury by accident arising out of or in the course of the employment, or whilst the worker is acting under the employer's instructions; the recurrence, aggravation, or acceleration of any pre-existing disease where the employment was a contributing factor to that recurrence, aggravation, or acceleration and contributed to a significant degree …". Section 5(1) also provided that: "'disease' includes any physical or mental ailment, disorder, defect, or morbid condition whether of sudden or gradual development". Section 21 of the Act provided: "An employer is liable to pay compensation under this Act from the date of incapacity resulting from the disability but clause 9 applies in any case." Clause 9 of Sched 1 is immaterial, but sub-cll 7(1) and (2) made provision for weekly payments of compensation during total incapacity for work and partial incapacity for work respectively. On 20 June 1995, Metrobus began paying workers' compensation to the worker. However, Metrobus later lodged a standard form entitled "Application Referring Dispute for Conciliation" ("the Application") in the Conciliation and Review Directorate. It was dated 19 June 1996 and filed on 21 June 1996. The Application stated, under the heading "Details of Dispute": "The employer disputes that the worker is entitled to compensation payments and seeks an order suspending payments under s 60 until such time as the worker proves he sustained an injury on 23.3.94." In substance Metrobus thus sought two things: a finding that the worker was not entitled to compensation payments, and an interim order suspending payments until the worker proved that he was entitled. Section 60 of the Act appeared in Div 5 (ss 56-72) of Pt III. The Division was headed "Commencement, Review, Suspension, and Cessation of Payments" and the heading to s 60 read "Application for discontinuance or reduction of weekly payments". Section 60 provided: "(1) Where weekly payments are made to a worker pursuant to this Division, the employer may apply to the Directorate at any time for an order that such payments be discontinued or reduced. If the employer satisfies the Directorate that there is a genuine dispute as to liability to pay compensation or as to the proper amount of such weekly payments, and in either case of the grounds of the dispute, the Directorate may order that the payments be suspended for such time as the Directorate directs or be discontinued or be reduced to such amount as it thinks proper or it may dismiss the application." The reference to the "Directorate" was to the Conciliation and Review Directorate, a body established by s 104A and comprising the Director, conciliation officers, review officers and other staff. The s 60 application by Metrobus sought an order for suspension of payments under sub-s (2). Part IIIA (ss 84A-84ZZB) was headed "Dispute Resolution", Div 2 (ss 84N-84Y) "Conciliation", and Div 3 (ss 84Z-84ZN) "Review". The term "dispute" was defined in s 84A as meaning in Pt IIIA "a dispute in connection with a claim for compensation under this Act", and as including, among other things, "a dispute as to liability to make or continue to make weekly payments of compensation". Section 84N, the first section in Div 2, provided: "Any party to a dispute may, by application, refer the dispute to the Director for conciliation." As well as being an application under s 60, the Application document was also an application under s 84N. So much is clear from r 6 of the Workers' Compensation (Conciliation and Review) Rules 1994 (WA) ("the Rules"). Rule 6 provided that an application referring a dispute to the Director for conciliation (ie, s 84N) was to be made in the form of Form 1 (found in Sched 1 to the Rules). The document lodged by Metrobus was in that form and under the heading "Details of Dispute" Metrobus referred both to the substantive issue to be resolved under Pt IIIA ("[t]he employer disputes that the worker is entitled to compensation payments") and the s 60 application. Thus, Metrobus lodged both a s 60 application and an application for conciliation under s 84N. This is also clear from the way the proceedings were dealt with by the Directorate, namely as two distinct applications each decided by a different review officer. A conciliation officer of the Directorate conducted a conciliation conference under s 84P of the Act, which was held on 26 June 1996. However, it did not result in any agreement. The conciliation officer referred the dispute for review under s 84Y of the Act. Section 84Y provided that a conciliation officer was to refer a dispute for review if any of the parties so requested, and that officer could vary or revoke an order previously made by the officer under Div 2 of Pt IIIA. On 15 July 1996, a "preliminary review" took place2. On that occasion, the parties agreed that the matter be adjourned to 21 August 1996, but Metrobus sought to have the application for an order suspending payments (the s 60 application) dealt with in advance, and independently, of the substantive issues (the s 84Y referral). After a hearing on 19 July 1996, the s 60 application was rejected: a review officer within the Directorate (the first review officer) ordered that Metrobus continue to make weekly compensation payments to the worker until further order. On 23 July 1996, he stated his reasons thus: "1. Given the conflict in the evidence provided during the course of the review I am satisfied the applicant has, pursuant to the provisions of section 60, established it has a proper basis to genuinely dispute its liability to pay compensation to the [worker]. However, whilst I find a genuine dispute exists the substantive issues in dispute between the parties are to be the subject of a review hearing to be conducted on 21 August 1996 where full and detailed evidence will be obtained so as to allow a final determination to be made. In those circumstances I do not believe it is appropriate that the weekly payments currently being made to the respondent worker should be suspended or reduced given the relatively short period of time until the review of 21 August 1996." The reasons of the review officer illustrate the operation of a s 60 application as a gateway to the decision on the substantive issues in a matter. 2 See r 12 of the Rules. However, as explained above, the s 60 application made under Pt III is separate from the Pt IIIA application for conciliation made under s 84N and then referred for review under s 84Y. Accordingly, it is possible for an employer to make an application for conciliation without making an accompanying s 60 application, and vice versa. Section 84B of the Act, which appeared in Pt IIIA, provided that proceedings for the resolution of a dispute were not capable of being brought other than under Pt IIIA. However, this did not prevent a s 60 application being made independently and without an application for conciliation. This is because a s 60 application could be pursued not to resolve a dispute, but to discontinue or reduce weekly payments. It is a separate and independent species of application, although no doubt it may be in the interests of the employer to seek to have the weekly payments suspended under Pt III before the substantive issues are decided under Pt IIIA. It has been necessary to deal with these basic structural aspects of the legislation at some length in the light of the disagreement between the parties in their submissions. An appreciation of the structure of the Act is required for the determination of the issues on the appeal respecting "finality" of decision-making under the statute and the identification of the issues decided. Following the rejection of the s 60 application, the dispute (ie, the application under Pt IIIA) then became the responsibility of a second review officer. Section 84ZA(4) empowered the review officer, subject to the Rules, to give directions respecting the proceedings. The officer issued a notice of listing dated 23 July 1996, in which, among others, the following directions were given: "1. Whereas on 19 July 1996 a review officer made a finding that there is a genuine dispute as to the liability of the employer to pay compensation to the worker and the parties having agreed prior to that date to have the substantive issue determined at [a] review on 21 August 1996 I direct that the worker be excused from commencing a fresh application subject to this matter proceeding on the basis that the employer is entitled to require the worker to prove an entitlement to compensation under the Act. That the parties attend prepared to deal with the substantive issue with the onus of proof being on the worker." Section 84ZF(1) of the Act provided: "The review officer may make such order as may be appropriate for giving effect to a decision made in the review." The review hearing proceeded on 21 and 22 August 1996 and 4 September 1996. On 6 September 1996, the second review officer made the following orders: "1. That weekly payments to the worker shall be discontinued as from and including 4 September 1996. That the employer's application at review for an order that the worker refund compensation paid, be dealt with by way of a fresh application referring the dispute for conciliation." The source of power to make the second order was s 71 of the Act; this gave the Directorate power to make appropriate orders in relation to the refund application by Metrobus. The source of power to make the first order was a matter of dispute. However, as explained, the second review officer was dealing with the substantive issues referred for review under s 84Y of the Act. The source of power could not have been s 60 as the s 60 application had been rejected on 19 July 1996. The source of power for the first order was s 84ZF(1), the text of which has been set out earlier in these reasons. The second review officer published the reasons for his decision on 19 November 1996. He noted that the worker bore the onus of proof, and identified various conflicts and inaccuracies in the worker's evidence. He posed the matter for decision in the following words: "I must be satisfied on the balance of probabilities that not only did the worker sustain an injury but that the injury or disability caused the worker to be incapacitated for work." Plainly, he had in mind ss 18 and 21 of the Act. The second review officer then made the following findings: "[T]he worker did sustain an injury of minor severity on 23 March 1994 and … he completed his shift that day before seeing his general practitioner. [T]he injury, described in the first medical report as a twisted left ankle and in the Final Medical Certificate as a strain to the left ankle joint, on the basis of the Final Medical Certificate, resolved." (emphasis added) These were findings that the worker had sustained a disability within the meaning of s 18, and that it had "resolved". But when? The Final Medical Certificate, which was based on an examination conducted on 25 March 1994 and which bore that date, did not say that the ankle injury had resolved: it said only that the worker had partially recovered, that he was fit to return to work on 28 March 1994, and that full recovery was "expected" and "imminent". The finding must be that it had "resolved" after 25 March 1994 but before 4 September 1996, the date from which the second review officer ordered compensation payments to be discontinued. The second review officer said: "In regard to the period from the end of April 1994 onwards I am unable to make a finding that the applicant has proved his case. The conflict and inconsistencies in the evidence, I think, on the balance of probabilities, affect the applicant's credibility to the extent that I must consider all his evidence as questionable. The history given to the medical practitioners from December 1994 is also to be considered in this light." After noting that the worker's evidence in general could not be relied on, the second review officer said: "I believe the evidence fails to establish that the applicant's present injuries arise out of or in the course of his employment with MetroBus, nor do I believe that there are grounds for finding that a recurrence or aggravation of the ankle injury within the definition of disability under the Act has occurred." (emphasis added) The first half of this sentence is a reference to par (a) of the definition of "disability" in s 5(1). The second half of the sentence is a reference to par (d). Metrobus contended that the "findings" emphasised in this passage and in the passage quoted above created an issue estoppel. Finally, the second review officer said, referring to s 21: "It is also necessary for the applicant to prove incapacity for work and in this regard I am of the view that Mr Kuligowski has not satisfied the onus upon him on this point." An appeal by the worker pursuant to s 84ZN(2) of the Act to the Compensation Magistrate's Court against the second review officer's orders was dismissed on 11 March 1997. The worker did not seek to appeal to the Supreme Court pursuant to s 84ZW. On 29 June 1998, over the opposition of Metrobus, a Deputy Registrar of the District Court granted the worker leave, under both s 93D of the Act and s 47A of the Limitation Act 1935 (WA), to institute proceedings for damages at common law against Metrobus3. On 26 November 1998, the worker instituted those proceedings. On 1 February 1999, the worker alleged in his statement of claim that the 23 March 1994 accident was the result of negligence on the part of Metrobus, and that numerous medical difficulties flowed from it. On 18 October 2000, Commissioner Ley allowed appeals by Metrobus against the Deputy Registrar's orders granting leave to the worker to institute proceedings at common law and rejecting Metrobus's application to have the proceedings dismissed on the ground of issue estoppel (inter alia). He concluded that the second review officer's finding that the injury suffered in the accident had "resolved" worked an issue estoppel. He did so on the ground that it was "legally indispensable to the conclusion that the [worker's] alleged disability did not arise out of or in the course of his employment". This was a narrower issue estoppel than that relied on in this Court. Application of "issue estoppel": uncontroversial matters In his speech in Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2)4, Lord Guest, after noting that the doctrine of issue estoppel had been accepted by Australian courts for a number of years, indicated that, for the doctrine to apply in the second set of proceedings, the requirements were: 3 Section 93D(4) of the Act, which was repealed and replaced with a new provision by the Workers' Compensation and Rehabilitation Amendment Act 1999 (WA), required the worker to obtain leave before commencing proceedings for damages. [1967] 1 AC 853 at 935. "(1) that the same question has been decided; (2) that the judicial decision which is said to create the estoppel was final; and, (3) that the parties to the judicial decision or their privies were the same persons as the parties to the proceedings in which the estoppel is raised or their privies." There was no dispute about the satisfaction of requirement (3). The second review officer was not sitting as a "court" in any strict or conventional sense, but it was common ground that5: "The doctrine of estoppel extends to the decision of any tribunal which has jurisdiction to decide finally a question arising between parties, even if it is not called a court, and its jurisdiction is derived from statute or from the submission of parties, and it only has temporary authority to decide a matter ad hoc." The controversy centred on requirements (1) and (2). It is convenient to start by considering requirement (2), that there must be a final decision. Was the second review officer's decision a final decision? A principal question in the worker's appeal to the Full Court against Commissioner Ley's orders was whether the Court should overrule a line of its earlier decisions6 on the ground that the second review officer's decision was not a final determination, or, to put the matter in other terms employed by the parties, on the ground that the provisions of the Act excluded the availability of issue estoppel. Malcolm CJ, Steytler J (with some doubt) and Templeman J considered that the second review officer's decision was final, that the Act did 5 The Administration of the Territory of Papua and New Guinea v Daera Guba (1973) 130 CLR 353 at 453 per Gibbs J. 6 McNair v Press Offshore Ltd (1997) 17 WAR 191; Waddington v Silver Chain Nursing Association (1998) 20 WAR 269. See also Re Monger; Ex parte Wilderness Equipment Pty Ltd [2003] WASCA 202 at [46] and [50] per Wheeler J. not exclude the availability of issue estoppel, and that the earlier decisions should not be overruled7. Wallwork and McLure JJ dissented8. The controversy in the Full Court, respecting the provisions supporting the review hearing on 21 and 22 August 1996 and 4 September 1996 and the orders made by the second review officer, should have been resolved in the fashion indicated earlier in these reasons. Wallwork and McLure JJ (and, in this respect, Templeman J) correctly reasoned that once the attempt to conciliate the dispute had failed, it was a "dispute" which s 84B gave a review officer exclusive jurisdiction to resolve by embarking on the procedures set out in Pt IIIA Div 39. Section 84ZA gave the review officer power to commence and conduct the review, and s 84ZF(1) gave power to make any order which was appropriate to give effect to a decision made in the review10. A particular difficulty in assessing finality arises if the order made pursuant to the judgment in question can later be altered. In Somodaj v Australian Iron and Steel Ltd11 Kitto, Taylor and Menzies JJ said: "The other additional argument which is now raised is concerned with the provisions of s 36(2) of the Workers' Compensation Act. By sub-s (1) of this section it is provided that the Commission shall have exclusive jurisdiction to examine into, hear and determine all matters and questions arising under the Act and the action or decision of the Commission shall be final. But sub-s (2) provides that nothing in sub-s (1) shall prevent the Commission from reconsidering any matter which has been dealt with by 7 Kuligowski v Metrobus (2002) 26 WAR 137 at 155 [76] per Malcolm CJ, 179 [208] per Steytler J, 181 [226]-[229] per Templeman J. 8 Kuligowski v Metrobus (2002) 26 WAR 137 at 170 [166] per Wallwork J, 195-196 9 Section 84A defined "review" as meaning "procedures taken by a review officer under Division 3 for the resolution of a dispute." 10 Kuligowski v Metrobus (2002) 26 WAR 137 at 168 [139] per Wallwork J, 180 [219]-[223] per Templeman J, 189-190 [285]-[286] per McLure J. 11 (1963) 109 CLR 285 at 297-298. it, or from rescinding, altering or amending any decision or order previously made, all of which the Commission shall have authority to do. With this sub-section in mind it is said that an award of the Commission can never give rise to an estoppel because it does not finally adjudicate upon the rights of the parties before it." Their Honours went on to reject the submission, making particular reference to the judgment of Isaacs J in Ainslie v Ainslie12: "As Isaacs J said in the latter case in relation to provisions such as those contained in sub-s (2): 'The true rule is to see whether or not the Legislature has by its enactment left the order entirely floating, so to speak, as a determination enforceable only as expressly provided and in the course of that enforcement subject to revision, or whether the order has been given the effect of finality unless subsequently altered'13. We are of the opinion that the legislation in question here plainly falls within the latter category and the award was an adjudication upon the rights of the parties, not of an interlocutory character, but completely effective unless and until it should be rescinded, altered or amended by the Commission. Some confirmation of this view may be found in the provisions of s 37 of the Act which provides that no award, order, or proceeding of the Commission shall be liable to be challenged, appealed against, reviewed, quashed, or called in question by any court of judicature on any account whatever." A "final" decision, then, is one which is not of an interlocutory character, but is completely effective unless and until rescinded, altered or amended. The fact that an appeal lies from a decision does not make it any less final14. It must be 12 (1927) 39 CLR 381. 13 (1927) 39 CLR 381 at 390. Isaacs J added: "This can only be ascertained by construing the Act as a whole." 14 The Administration of the Territory of Papua and New Guinea v Daera Guba (1973) 130 CLR 353 at 454 per Gibbs J. "final and conclusive on the merits": "the cause of action must be extinguished by the decision which is said to create the estoppel"15. In the Act (in the form in which it applied in the present case) there was no explicit general power to reconsider the decisions of review officers in the light of further information (cf s 84ZF(3), introduced in 1999). However, apart from the facility given by s 60 for employers to apply for payments to be discontinued or reduced, s 62(1) gave a power to the worker and the employer to request a review of weekly payments and a discontinuance of, reduction in, or increase in them. The worker relied on the reasoning of the dissenting judges in the Full Court, which turned on three points. First, proceedings for the resolution of disputes in connection with claims for compensation under the Act could only be brought under Pt IIIA: s 84B. Where conciliation under Pt IIIA Div 2 either was not attempted or failed, and matters had to be determined by review officers under Pt IIIA Div 3, the Act established a procedure with the following features. It was intended to be speedy, informal and economical: ss 3(d) and 84ZA(2). The review officer was not bound by the rules of evidence: s 84ZD(1). There could only be legal representation if the parties consented or if, there being a question of law, the review officer permitted it: s 84ZE. Where there was a conflict of medical opinion, it was to be resolved by a medical assessment panel in an equally informal way, before which there was no right of legal representation at all: ss 84ZH and 145D(4). Secondly, s 84ZN(1) provided: "Subject to this section, a decision or order of a review officer is not open to question or review in any court, and proceedings by or before a review officer may not be restrained by injunction, prohibition, or other process or proceedings in any court or by removal by certiorari or otherwise in any court." 15 Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853 at 935 per Lord Guest. It was said to be significant that this sub-section did not describe the decision or order as final or conclusive, in contrast to statutes which had been held not to exclude issue estoppel16, in contrast to ss 11717 and 145E(5)18 of the Act in their post-1993 form, and in contrast to s 116 of the Act in its pre-1993 form19. Thirdly, it was said that determinations under s 58(5) ordering, or refusing to order, weekly payments were probably not final20; that issues raised under 16 For example, s 36(1) of the Workers' Compensation Act 1926 (NSW), discussed in Somodaj v Australian Iron and Steel Ltd (1963) 109 CLR 285 at 297: see above at That sub-section provided: "The Commission shall have exclusive jurisdiction to examine into, hear and determine all matters and questions arising under this Act, and the action or decision of the Commission shall be final." 17 Section 117 provided that a determination of a compensation magistrate's court "is final and conclusive". 18 Section 145E(5) provided: "Unless rescinded under section 145F, the determination, or if the determination is varied under that section the determination as varied, is final and binding on the worker and his employer and on any court or tribunal hearing a matter in which any such determination is relevant and the written determination given under subsection (3) is, in the absence of evidence that the determination was so rescinded or varied, conclusive evidence as to the matters determined." 19 Section 116 provided that a determination of the former Workers' Compensation Board was to be "final and conclusive". 20 Kuligowski v Metrobus (2002) 26 WAR 137 at 189 [282] per McLure J. Section 58(6) provided: "The fact that an application has been dismissed under subsection (5) shall not be taken into account by the Directorate in any other proceedings under this Act." s 58(5) could be re-litigated under s 6021; and that s 62 determinations were not final22. This reasoning is flawed. First, the non-judicial composition of the Directorate, its functions, its speedy and informal processes, the fact that the review officers were not bound by the rules of evidence, and the substantial exclusion of legal representatives – all these things are neutral on the question of finality. The defining feature of a final decision – complete effectiveness unless and until it can be amended – may be absent from proceedings of the most formal and elaborate character, and may be present in proceedings of the most informal and brisk character. Further, as Templeman J pointed out23, the legislative goal of having workers' compensation disputes heard and determined in an informal, quick and cheap manner would not be assisted by a construction of the legislation which prevented the doctrine of issue estoppel from ever applying. That would increase the chance of double litigation of issues and vexation of parties. Further, to ask whether decisions made under ss 58, 60 or 62 are "final" is to ask an incomplete question, because in fact no relevant decision is made under these sections considered in isolation. As discussed earlier in these reasons, these sections may, in effect, act as gateways through which parties wishing to obtain resolution of particular disputes then may pass. Once the parties have passed through those gateways, the proceedings for the resolution of the dispute are brought under, and only under, Pt IIIA, and if conciliation fails, they are resolved by review under Div 3. Metrobus utilised the s 60 gateway. The first review officer declined to suspend payments under s 60(2), but a "review" had to take place – that is, under s 84A, "procedures taken by a review officer under [Pt IIIA] Division 3 for the resolution of a dispute". Questions as to the finality of any decision or order made resolving the dispute depend on the construction of 21 Kuligowski v Metrobus (2002) 26 WAR 137 at 189 [282] per McLure J. 22 Kuligowski v Metrobus (2002) 26 WAR 137 at 187 [271] per McLure J. 23 Kuligowski v Metrobus (2002) 26 WAR 137 at 181 [227], following McNair v Press Offshore Ltd (1997) 17 WAR 191 at 198 per Owen J. Pt IIIA Div 3, not ss 58, 60 and 62. But, in any event, the fact that certain decisions or orders can be reconsidered does not prevent them from being final. Secondly, the argument resting on the contrast drawn between the presence of the words "final and binding" in s 145E(5), and their absence in s 84ZN(1), overlooks the special function of the words in the former provision. Section 145E(5) provided that, unless rescinded under s 145F, the determination of a medical assessment panel was to be "final and binding on the worker and his employer and on any court or tribunal hearing a matter in which any such determination is relevant". That is, the sub-section prevented parties from reagitating the panel's determination before the review officer. But it established no significant difference between a panel's determination and the review officer's decisions and orders: any determination of a panel would itself have been an element in those decisions and orders. In evaluating the third argument relied on by the minority, resting on contrasts between the form of the legislation relevant to the present case (as enacted in 1993) and its form before 1993, it is necessary to remember the radical change in appellate rights that took place. Before the 1993 amendments, there was an appeal as of right from the Workers' Compensation Board to the Full Court of the Supreme Court from final determinations or orders of the Board made under s 116 on questions of both law and fact (s 136(1)), and an appeal with leave from determinations or orders made under s 116 which were not final, again on questions of both law and fact (s 136(2)). The 1993 amendments significantly narrowed the opportunities to appeal from review officers' decisions: on questions of fact, not at all; on questions of law, only to a compensation magistrate's court (s 84ZN(2)), and thence only by leave to the Full Court of the Supreme Court (ss 84ZW and 84ZX). Contrasts between the language of the pre-1993 s 116 and the post-1993 s 84ZN lack significance in these circumstances. That leaves the argument resting on a contrast between s 84ZN(1) and s 117 in its post-1993 form. As Malcolm CJ24 and Templeman J25 pointed out, to have described the decision of the review officer as "final and conclusive" when 24 Kuligowski v Metrobus (2002) 26 WAR 137 at 151-152 [59]. 25 Kuligowski v Metrobus (2002) 26 WAR 137 at 181 [232]. an appeal as of right on a question of law lay against it to a compensation magistrate's court pursuant to s 84ZN(2) may have been thought inappropriate drafting. However, it is less inappropriate for the determination of a compensation magistrate's court to be described in s 117 as "final and conclusive" in view of the fact that there is no appeal as of right from it, but an appeal only by leave (s 84ZW). The crucial question is the construction of the language employed in s 84ZN. To provide, as s 84ZN provided, that, subject to an appeal to a compensation magistrate's court on a question of law, decisions or orders of a review officer were not open to question or review in any court, was to provide that they were final – despite the non-inclusion of the words "final and conclusive". Section 37(1) of the legislation considered in Somodaj v Australian Iron and Steel Ltd, which bore some resemblance to s 84ZN, was said to provide "[s]ome confirmation" of the final character of the determination in that case26. Reliance was placed by Metrobus on the Second Reading Speech of the Minister responsible for the 1993 amendments in the Legislative Assembly of Western Australia on 21 September 199327. That speech reveals a general determination to restrict the common law rights of injured workers, but it throws no light on the particular issue of statutory construction just discussed. The decision of the second review officer was final, because it was "completely effective unless and until it should be rescinded, altered or amended"28. 26 (1963) 109 CLR 285 at 298 per Kitto, Taylor and Menzies JJ. Section 37(1) of the Workers' Compensation Act 1926 (NSW) provided: "No award, order, or proceeding of the Commission shall be … liable to be challenged, appealed against, reviewed, quashed, or called in question by any court of judicature, on any account whatsoever." 27 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 21 September 1993 at 4233-4240. 28 Somodaj v Australian Iron and Steel Ltd (1963) 109 CLR 285 at 298 per Kitto, Same question? In Ramsay v Pigram29, Barwick CJ encapsulated what was involved in answering that question by saying: "Long standing authorities, in my opinion, warrant the statement that, as a mechanism in the process of accumulating material for the determination of issues in a proceeding between parties, an estoppel is available to prevent the assertion in those proceedings of a matter of fact or of law in a sense contrary to that in which that precise matter has already been necessarily and directly decided by a competent tribunal in resolving rights or obligations between the same parties in the same respective interests or capacities, or between a privy of each, or between one of them and a privy of the other in each instance in the same interest or capacity. The issue thus determined, as distinct from the cause of action in relation to which it arose, must have been identical in each case." The worker argued that the question before the second review officer was not identical to the question which will arise in the District Court proceedings. The question posed in the District Court proceedings by s 93D of the Act is whether the worker had a serious disability (s 93D(1)) and whether his "future pecuniary loss resulting from the disability is of an amount that is at least equal to the prescribed amount" (s 93D(2)(b)) – that is, $119,048. The worker's statement of claim pleads that the accident of 23 March 1994 occurred as a result of the negligence of Metrobus, and caused the worker injuries. It continues: "6. On or about April 1995 and as a consequence of ongoing instability in his left ankle, the Plaintiff's ankle gave way causing him to twist and injure his left knee. On 6 November 1995 and as a consequence of ongoing symptoms in his left ankle, the Plaintiff underwent surgery … for the repair of the peroneal tendons in his left ankle. During surgery the plaintiff 29 (1968) 118 CLR 271 at 276. aspirated some of the gastric contents of his stomach into his lungs causing post operative lung complications." The statement of claim then pleads numerous items of damage resulting from the "accident related injuries". The issue estoppel defence was pleaded in the following way in pars 9-11 of the Defence of Metrobus: Review Officer Cocker ordered that the weekly payments from the Defendant to the Plaintiff be discontinued as from and including 4 September 1996 and made the following findings: the Plaintiff's injury of 23 March 1994 was of minor severity; the Plaintiff's credibility was less than satisfactory; inconsistencies and contradictions existed between the documents and medical evidence which adversely affected the Plaintiff's evidence generally; the Plaintiff was not a credible witness; the evidence failed to establish that the Plaintiff's injuries arose out of or in the course of his employment with the Defendant; there were no grounds for finding that a recurrence or aggravation of the ankle injury within the definition of disability under section 5 of the Act had occurred. 10. An appeal from Review Officer Cocker's decision before Magistrate Heath heard on 4 March 1997 (Appeal No CM-69/96) was dismissed. 11. By reason of the matters pleaded in paragraphs 5 to 10 hereof and the Review Officer's findings in the Application, the Defendant says further, and in the alternative, that the Plaintiff is estopped from alleging that he suffers from a serious disability within the meaning of s 93D of the Act. PARTICULARS OF ISSUE ESTOPPEL The Conciliation and Review Directorate is a competent tribunal. The circumstances and the evidence in this action are precisely the same as on the Application. Review Officer Cocker's determination was a judgment. final Review Officer Cocker's findings form the legal foundation or justification for the ultimate orders, and were not merely collateral or subsidiary to those proceedings." It may be noted that par (b) of the particulars of issue estoppel does not in terms plead that the issues are the same. In this Court, Metrobus adopted a more precise approach: it relied on the passages emphasised in the quotations from the second review officer's reasons for decision which are set out above30. The question is whether a finding that the 23 March 1994 injury had "resolved", considered with the other observations of the second review officer, is a finding on the same issue as the issue whether in April 1995 the worker had "ongoing instability in his left ankle". It is for Metrobus to demonstrate that the issues are the same. This it did not do. The second review officer did not make any finding, as distinct from making general comments on the evidence, as to when the 23 March 1994 injury "resolved". Nor did the second review officer make it clear what was meant by the word "resolved". Let it be assumed that the second review officer's reasons for decision are to be read as containing findings that, although the 23 March 1994 accident occurred in the course of his employment, the worker's "present injuries" did not fall within pars (a) or (d) of the definition of "disability", and were not such as to render the worker incapable of work. Even on that assumption, it would not be inconsistent with the second review officer's findings 30 At [14] and [16]. for the District Court to hold in the common law action that there was ongoing instability in the worker's ankle in April 1995 of a kind which, though it did not prevent him from being able to work, was capable of causing his ankle to give way, thus causing him to twist and injure his left knee in April 1995 in the manner alleged. Obviously, if the reasoning of the second review officer is sound, there are considerable difficulties in the case that the worker wishes the District Court to consider. But the difficulties that the evidence which is accepted or rejected in reaching a decision in one set of proceedings may create in a second set, are immaterial in assessing whether the doctrine of issue estoppel applies. Not all estoppels are odious31. But all must be certain. It is for that reason that the law, as exemplified in the passage from the judgment of Barwick CJ in Ramsay v Pigram32 set out above, has strict requirements for the application of issue estoppel. It might have been possible for the second review officer to have made findings which would operate as issue estoppels in relation to the District Court proceedings. But he did not, whether because the worker's case before him was put in a particular way, or because the representative of Metrobus did not stipulate the findings which could be used as the foundation for issue estoppel, or because the issues in proceedings under the Act and in proceedings at common law in these particular circumstances are intractably different, or because of the informality of the proceedings before the second review officer. The worker apparently did not submit to the second review officer that, whether or not the 23 March 1994 injury incapacitated him, it so affected him that he had an ongoing instability rendering him susceptible to further injury. And even if the worker did propound that issue, the second review officer said nothing about it. The issues which the second review officer did examine, namely whether the worker's "present injuries" could be characterised as a disability within pars (a) or (d) of the statutory definition of "disability" and whether they incapacitated the worker, are distinct from the issues raised in the 31 New Brunswick Railway Co v British and French Trust Corporation Ltd [1939] AC 1 at 21 per Lord Maugham LC. 32 (1968) 118 CLR 271 at 276. District Court. Those latter issues are whether the 23 March 1994 injury fell within par (a) of the definition at the outset, whether it was negligently caused, whether it created ongoing instability, and whether the injuries of which the worker now complains are causally related to Metrobus's negligence. It was arguably unnecessary for the second review officer to deal with those issues, and in particular the issue of whether an ongoing instability was created, since favourable answers would not have assisted the worker unless the second review officer also reached a favourable answer on incapacitation. Metrobus argued that the worker's contentions overlooked two facts − the fact that the "disabilities" for which compensation was payable under the Act were the same "disabilities" as those for which s 93D permitted recovery at common law, and the fact that he continued to contend that he fell within par (a) of the definition of "disability". But these facts do not assist Metrobus. The second review officer did find an "injury of minor severity", and may have implicitly found, by his non-critical summary of the evidence, that there was an incapacity for a few days. But the issue of "incapacity" (for which the worker had to contend before the second review officer by reason of s 21) is different from those matters that he wishes to argue before the District Court. The disability that the District Court will be invited to find for the purposes of s 93D(1) and (2)(b) is not necessarily a disability causing an incapacity to work for the bulk of the March 1994−August 1997 period. In that respect, it is easier for the worker to succeed at common law than under ss 18 and 21 and Sched 1 cl 7 of the Act. The mode of conducting, and the answer to, the inquiry whether there is a disability may vary depending on the reason why the inquiry is being made. A worker may be said not to have a disability if the inquiry is whether he should be paid workers' compensation for resulting incapacity. And he may equally be said to have a disability if the inquiry is whether he should be paid common law damages in relation to an accident which caused ongoing susceptibility to injury. The second review officer's statement that "the evidence fails to establish that the [worker's] present injuries arise out of or in the course of his employment with MetroBus" cannot work an issue estoppel unless it was made in the course of resolving a controversy which the worker is said now to be estopped from agitating. The Full Court treated the second review officer's findings as denying that there was any causal link between the 23 March 1994 accident and the post-April 1995 symptoms. The Full Court said that the issue of whether the 23 March 1994 accident created a susceptibility to later injury was an issue before the second review officer that he had decided adversely to the worker33. There is nothing in the reasons for decision of the second review officer suggesting that the worker advanced, or the officer dealt with, any contention that the 23 March 1994 accident caused a susceptibility to later injury. A question on that subject was asked of one of the worker's treating doctors, was not responsively answered, and was then objected to34. To state the issue as being whether the 23 March 1994 accident had "resolved" is ambiguous35. If the stated issue is ambiguous, so is the finding. Neither the content nor the context of the second review officer's reasons for decision removed the ambiguity. Since the second review officer did not direct his mind to the relevant question arising in the District Court proceedings, namely whether the 23 March 1994 accident resulted in a latent susceptibility to injury, his general remarks, which the Full Court categorised as causation findings, cannot work an issue estoppel if only because of their vagueness36. Reference was made in argument to the Hoysted litigation in this Court and in the Privy Council37. The ultimate decision, that of the Privy Council upholding the dissent of Higgins J in Hoysted v Federal Commissioner of 33 Kuligowski v Metrobus (2002) 26 WAR 137 at 154 [69], 159 [102]-[103] per Malcolm CJ, 168 [139] per Wallwork J, 179 [209] per Steytler J, 182 [240] per Templeman J, 191-192 [297]-[301] per McLure J. 34 Apart from the transcript page containing that question, nothing in the material before this Court indicates the scope of the evidence before the second review officer. Hence no inference as to the issues can be drawn from the materials before him. 35 Kuligowski v Metrobus (2002) 26 WAR 137 at 191 [298] per McLure J. 36 As Coke said, "every estoppell, because it concludeth a man to alleadge the truth, must be certaine to every intent, and not to be taken by argument or inference": Coke, First Institutes of the Laws of England or A Commentary Upon Littleton, 18th ed (1823), vol 2, par 352b. 37 Hoysted v Federal Commissioner of Taxation (1920) 27 CLR 400; Hoysted v Federal Commissioner of Taxation (1921) 29 CLR 537; (1925) 37 CLR 290 (PC); Taxation38, turned upon the text of the conditions specified in the legislation for the operation of the deduction provision in question. The Privy Council emphasised that unless it had been decided in the first High Court case that certain persons had held a beneficial interest in land or income "in such a way that they are taxable as joint owners", they could not have been taxed at all39. Higgins J had referred to the use of the phrase "actually litigated and determined" by the Supreme Court of the United States in Cromwell v County of Sac40, and had continued41: "My view is that the point as to joint ownership was, by virtue of the formal objections, and from the nature of the judgment thereon, 'actually litigated and determined' in the former proceedings; and that whether the judgment in its actual form was due to the Commissioner's consent or admission or to his neglect, he is bound by the finding of joint ownership which the judgment necessarily involves." In the present case, in the proceedings under the Act, no findings were made which operated in the manner alleged as issue estoppels, nor was the structure of the legislation and the nature of the proceedings such that it could be said, within the meaning of the Hoysted litigation, that the necessary findings must be treated as having been actually litigated and determined. Findings in proceedings under workers' compensation legislation concerning the existence or non-existence of particular injuries sometimes have been treated as findings on ultimate facts in relation to the issue of whether a worker is incapacitated. Egri v DRG Australia Ltd42 may be such a case. However, as has been indicated, the present appeal does not fall in any such category. 38 (1921) 29 CLR 537. 39 (1925) 37 CLR 290 at 304-305; [1926] AC 155 at 171-172. 40 94 US 351 at 353 (1876). 41 (1921) 29 CLR 537 at 562-563. 42 (1988) 19 NSWLR 600 at 604-605 per McHugh JA, 612-613 per Clarke JA. Immaterial matters For the reasons just given, the doctrine of issue estoppel does not prevent the worker from pursuing the District Court proceedings. In the course of argument other issues arose, which might have supported that outcome. But in the circumstances, it is not necessary to decide them. One issue turned on the worker's argument that even if the second review officer's finding that the 23 March 1994 ankle injury had "resolved" created an issue estoppel, it did so only in relation to a closed period. A second issue also arose in argument as to whether the second review officer, though having jurisdiction to decide a particular class of matter, lacked jurisdiction to determine conclusively the correctness of ancillary matters which he had to decide in the course of exercising his jurisdiction43. Since the reasoning set out above precludes any issue estoppel, these two issues, on which there was very little argument, need not be considered. A final issue was raised by the form of the second review officer's reasoning. In the passages quoted above, apart from the finding that the injury had "resolved", the second review officer did not make any positive findings that the worker did not have disabilities or that the worker did not have an incapacity for work. Rather, the second review officer's reasons speak of the evidence failing to establish the worker's case, of not believing that there were grounds for finding it, and of the worker not satisfying the onus upon him. In the leading Western Australian decision, which the majority of the Full Court applied, and which it was the purpose of this appeal to test, Owen J said that where "a party has failed to prove a fact in workers' compensation proceedings that party may be estopped in a common law action from asserting the existence of that fact"44. With one exception, the authorities then cited do not 43 See Cachia v Isaacs (1985) 3 NSWLR 366 at 386-390 per McHugh JA. 44 McNair v Press Offshore Ltd (1997) 17 WAR 191 at 197. support that proposition45. The exception is Egri v DRG Australia Ltd46, where Clarke JA rejected an argument that a failure by the worker to establish that he had a disc lesion was insufficient to create an estoppel preventing him from later contending that he did. The reasoning is not clear, and it was not supported by McHugh JA, who found that, in substance, there had been a positive finding that there was no disc lesion47. In general, disbelief in a witness's evidence does not establish the contrary48. Similarly, disbelief in the case presented by the moving party does not necessarily permit the court to conclude that the positive case of the opposing party is correct. In particular cases it may not be possible to reach a conclusion either way49: 45 No question of issue estoppel arose in Tiver Constructions Pty Ltd v Clair (1992) 106 FLR 121. David Jones (Canberra) Pty Ltd v Zapasnik (1982) 42 ACTR 6 did not involve any failure to find a fact. In Makowski v TVW Enterprises Ltd unreported, Supreme Court of Western Australia, 16 December 1994, Owen J stated the proposition which he repeated in McNair's case, but again there was no failure to make a positive finding, and the case turned on other questions. Green v Green (1935) 37 WALR 76 was not a case in which common law proceedings followed workers' compensation proceedings, rather, the applicant sought to commence fresh proceedings in respect of the same injury in the same jurisdiction. No question arose as to whether issue estoppel could be based on a mere failure to be satisfied. Though part of the award in Somodaj v Australian Iron and Steel Ltd (1963) 109 CLR 285 referred to a failure to establish a fact, the majority of this Court treated the award (read as a whole) as containing a positive finding that the worker had not suffered a relevant injury: at 298-299 per Kitto, Taylor and 46 (1988) 19 NSWLR 600 at 608. 47 Egri v DRG Australia Ltd (1988) 19 NSWLR 600 at 605. 48 Hobbs v Tinling (C T) and Co Ltd [1929] 2 KB 1 at 21 per Scrutton LJ. 49 Rhesa Shipping Co SA v Edmunds [1985] 1 WLR 948 at 955 per Lord Brandon of Oakbrook; [1985] 2 All ER 712 at 718. "[T]he judge is not bound always to make a finding one way or the other with regard to the facts averred by the parties. He has open to him the third alternative of saying that the party on whom the burden of proof lies in relation to any averment made by him has failed to discharge that burden." A failure to find a matter alleged does not establish the truth of the contrary of that which is alleged. There are many general statements about the operation of issue estoppel, approved in this Court, which require more than non-satisfaction to establish an estoppel in later proceedings. For example, in Jackson v Goldsmith50, Williams J approved a passage from Halsbury's Laws of England51 including the following: "A party is precluded from contending the contrary of any precise point which, having been once distinctly put in issue, has been solemnly found against him." Much here turns upon what is involved in the phrase "solemnly found". The form of the first proceeding, particularly the issues joined or admitted on any pleadings, will be important. In Hoysted v Federal Commissioner of Taxation52, "A point or an issue may be actually controverted, may be in actual controversy, in actual litigation, although it is not argued, or argued properly. A point may be in controversy although counsel may address no arguments to it, or may overlook certain aspects." An issue admitted on pleadings or other formal process or otherwise conceded at a hearing may, from the nature of the outcome, necessarily have been decided. But what of other questions arising in the first proceeding? In Blair v Curran53, Dixon J observed that a "judicial determination concludes, not 50 (1950) 81 CLR 446 at 460. 51 2nd ed (1934), vol 13 at 409. 52 (1921) 29 CLR 537 at 562. 53 (1939) 62 CLR 464 at 532. merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not then directly the point at issue". His Honour went on to distinguish findings concerning only "evidentiary facts" not the "ultimate facts" which formed the very title to rights in dispute54. This analysis, with the emphasis on decision-making, would require more than non-satisfaction. However, although this important issue was raised by the Court during argument, the primary submissions of the parties were not directed to it, the authorities were not examined and it is not necessary to decide it in the present case. Accordingly, like the other matters just identified, it may be put on one side. Orders The following orders should be made. Appeal allowed with costs. Set aside the orders of the Full Court of the Supreme Court of Western Australia dated 24 June 2002 and in place thereof order that: the appellant's appeal to the Full Court be allowed with costs; the orders of the District Court of Western Australia dated 18 October 2000 (in WC 93 D 775 of 1997 and CIV 4575 of 1998) be set aside and the matter remitted to the District Court for hearing; and the respondent pay the appellant's costs of the said District Court proceedings both before Deputy Registrar Harman and Commissioner Ley. 54 (1939) 62 CLR 464 at 532.
HIGH COURT OF AUSTRALIA CONDON APPLICANT AND POMPANO PTY LTD & ANOR RESPONDENTS Assistant Commissioner Michael James Condon v Pompano Pty Ltd [2013] HCA 7 14 March 2013 ORDER The questions asked by the parties in the Special Case dated 26 October 2012 and referred for consideration by the Full Court be answered as follows: Question 1 Is s 66 of the Criminal Organisation Act, by requiring the Court to hear an application that particular information is criminal intelligence without notice of the application being given to the person or organisation to which the information relates, invalid on the ground that it infringes Chapter III of the Constitution? Answer Question 2 Is s 70 of the Criminal Organisation Act, by requiring the Supreme Court to exclude all persons other than those listed in s 70(2) from the hearing of an application for a declaration that particular information is criminal intelligence, invalid on the ground that it infringes Chapter III of the Constitution? Answer Question 3 Is s 78 of the Criminal Organisation Act, by requiring a closed hearing of any part of the hearing of the substantive application in which the court is to consider declared criminal intelligence, invalid on the ground that it infringes Chapter III of the Constitution? Answer Question 4 Is s 76 of the Criminal Organisation Act, by providing that: an informant who provides criminal intelligence to an agency may not be called or otherwise required to give evidence; an originating application and supporting material need not include any identifying information about an informant; and identifying information can not otherwise be required to be given to the court, invalid on the ground that it infringes Chapter III of the Constitution? Answer Question 5 Is s 10 of the Criminal Organisation Act, insofar as it requires the Court to have regard to information that is declared criminal intelligence which a respondent or a respondent's legal representative has not heard or received because of the effect of ss 66, 70, 76, 77, 78, 82 and 109 of the Criminal Organisation Act, and when read with ss 63(5), 64(2), 64(8), 65(4), 71(2) and 80(2), invalid on the ground that it infringes Chapter III of the Constitution? Answer Question 6 Is s 10(1)(c) of the Criminal Organisation Act invalid on the ground that it infringes Chapter III of the Constitution because of the nature of the judgment that it requires the Court to make? Answer Question 7 Is s 9 of the Criminal Organisation Act, when read with s 8(5) and s 106, invalid on the ground that it infringes Chapter III of the Constitution? Answer Question 8 Who should pay the costs of the special case? Answer The respondents. Representation W Sofronoff QC, Solicitor-General of the State of Queensland with G J D del Villar for the applicant (instructed by Crown Law (Qld)) B W Walker SC with A J Kimmins and P Kulevski for the respondents (instructed by Potts Lawyers) Interveners J T Gleeson SC, Acting Solicitor-General of the Commonwealth with N J Owens and D M Forrester for the Commonwealth, (instructed by Australian Government Solicitor) the Attorney-General of intervening M G Sexton SC, Solicitor-General for the State of New South Wales with J G Renwick SC and K M Richardson for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor (NSW)) W Sofronoff QC, Solicitor-General of the State of Queensland with G J D del Villar for the Attorney-General of the State of Queensland, intervening (instructed by Crown Law (Qld)) M P Grant QC, Solicitor-General for the Northern Territory with R H Bruxner for the Northern Territory, intervening (instructed by Solicitor for the Northern Territory) the Attorney-General for M G Hinton QC, Solicitor-General for the State of South Australia with L K Byers for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor (SA)) S G E McLeish SC, Solicitor-General for the State of Victoria with G A Hill for the Attorney-General for the State of Victoria, intervening (instructed by Victorian Government Solicitor)) R M Mitchell SC with F B Seaward for the Attorney-General for the State of Western Australia, intervening (instructed by State Solicitor (WA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Assistant Commissioner Michael James Condon v Pompano Pty Ltd Constitutional law – Constitution, Ch III – Institutional integrity of State courts – Section 10(1) of Criminal Organisation Act 2009 (Q) ("Act") allowed Supreme Court of Queensland on application of commissioner of police service to declare organisation "criminal organisation" – Where criminal organisation application supported by "criminal intelligence" – Sections 66 and 70 of Act required closed criminal intelligence hearing with no notice given to respondents – Section 78(1) of Act required Supreme Court to close part of criminal organisation hearing when criminal intelligence considered – Whether provisions of Act denied procedural fairness to respondents to criminal organisation application – Whether provisions of Act repugnant to or inconsistent with continued institutional integrity of Supreme Court – Whether question of organisation being "unacceptable risk to the safety, welfare or order of the community" suitable for judicial determination – Whether ss 9 and 106 of Act prevented Supreme Court from extending time for respondents to file response to criminal organisation application. Words and phrases – "closed hearing", "continued institutional integrity", "criminal fairness", "procedural "criminal organisation", "unacceptable risk to the safety, welfare or order of the community". intelligence", Constitution, Ch III. Criminal Organisation Act 2009 (Q), ss 8-10, 63-66, 70, 71, 76-78, 80, 82, 106. Introduction At the heart of the common law tradition is "a method of administering justice."1 That method requires judges who are independent of government to preside over courts held in public in which each party has a full opportunity to present its own case and to meet the case against it. Antithetical to that tradition is the idea of a court, closed to the public, in which only one party, a government party, is present, and in which the judge is required by law to hear evidence and argument which neither the other party nor its legal representatives is allowed to hear. The common law informs the interpretation of the Constitution and statutes made under it. It carries with it the history of the evolution of independent courts as the third branch of government and, with that history, the idea of a court, what is essential to that idea, and what is not. The common law may be changed or abrogated by parliaments. The courts must apply the laws enacted by the parliaments. However, where the Constitution limits legislative powers and the purported exercise of those powers is challenged, the courts must also decide whether those limits have been exceeded. Their decisions will be informed by the text of the Constitution, implications drawn from it, and principles derived from the common law. This Court has been asked to determine whether provisions of the Criminal Organisation Act 2009 (Q) ("the COA"), a law of the State of Queensland, exceed constitutional limits. The limits derive from Ch III of the Constitution. State and Territory legislatures cannot confer or impose upon State or Territory courts functions which substantially impair their defining or essential characteristics as courts. The Queensland law, which is said to exceed those constitutional limits, is directed to the disruption and restriction of the activities of criminal organisations and their members and associates. It imposes upon the Supreme Court of Queensland requirements for closed hearings and the use of secret evidence known only to the judge and one of the parties, being the government party, which seeks to tender it. The provisions which are challenged concern the use, in proceedings under the COA, of information designated "criminal intelligence" and the way in which the Supreme Court is required to decide whether information falls into that category. The question going to validity is whether those provisions of the COA substantially impair the defining or essential characteristics of the Supreme Court of Queensland as a court. 1 Goodhart, "What is the Common Law", (1960) 76 Law Quarterly Review 45 at 46. Like most cases about constitutional limits the answer is not black and white. The deeply rooted common law tradition of the open court, presided over by an independent judge according procedural fairness to both parties, is adapted to protect the public interest in cases such as those involving national security, commercially sensitive documents and the protection of police informants. Similarly, the constitutional limits do not prevent parliaments from making laws for the protection of the public interest in such areas. For the reasons that follow, the impugned provisions of the COA do not substantially impair the essential characteristics of the Supreme Court of Queensland. That is to say, they have not been shown to transgress constitutional limits. Procedural background The COA provides for "the making of declarations and orders for the purpose of disrupting and restricting the activities of organisations involved in serious criminal activity, and of their members and associates"2 On 1 June 2012, the Assistant Commissioner of the Queensland Police Service filed an application in the Supreme Court under s 8 of the COA seeking a declaration under s 10 that the Finks Motorcycle Club, Gold Coast Chapter and Pompano Pty Ltd, said to be "part of" that Chapter (together "the organisation"), constitute a criminal organisation. A list of persons said to constitute the current members of the Gold Coast Chapter was set out in the application together with a list of former members and nominee members, and of the office-bearers and shareholders of Pompano Pty Ltd. The application was supported by 135 affidavits. The application was required by s 8 of the COA to state the grounds upon which the declaration was sought3 and information supporting those grounds4. It was required to be accompanied by any affidavit the applicant intended to rely on at the hearing of the application5. The grounds on which the declaration was sought were: The organisation consists of a group of more than three people based inside Queensland; 2 COA, long title. See also the stated objects in s 3(1). 3 COA, s 8(2)(c). 4 COA, s 8(2)(d). 5 COA, s 8(3). The members associate for the purposes of engaging in or conspiring to engage in serious criminal activity as defined in ss 6 and 7 of the Criminal Organisation Act 2009; The organisation is an unacceptable risk to the safety, welfare and order of the community." Information supporting the grounds of the application was set out at length. The first part of the information consisted of a list of members, nominee members and former members of the Gold Coast Chapter, each of whom was said to have a criminal history in Queensland and/or other parts of Australia. The next part of the application set out information, under a heading which read: "The members associate for the purpose of engaging in or conspiring to engage in serious criminal activity and the Organisation is an unacceptable risk to the safety, welfare and order of the community." That information consisted of a list of members of the Gold Coast Chapter with details of their criminal convictions. Those convictions were for offences said to have been committed singly or in combination with others. At par 613 of the application, the following statement appeared: "Information supporting the grounds of this application is also contained in information which has been declared criminal intelligence." "Criminal intelligence" is defined in s 59 of the COA: "(1) Criminal intelligence is information relating to actual or suspected criminal activity, whether in the State or elsewhere, the disclosure of which could reasonably be expected to— prejudice a criminal investigation; or enable the discovery of the existence or identity of a law confidential source of enforcement; or information relevant endanger a person's life or physical safety. Criminal intelligence may be information that the commissioner has obtained through the police service or from an external agency." Prior to the filing of the application on 1 June 2012, the applicant had applied ex parte to the Supreme Court, under s 63 of the COA, for a declaration, under s 72, that particular information was "criminal intelligence" within the meaning of s 59. As required by ss 66 and 70 of the COA, the Supreme Court considered that application without notice to the respondents and in a "special closed hearing". A person appointed as a kind of statutory "amicus curiae" under s 83 of the COA and designated as the criminal organisation public interest monitor ("the COPIM") attended at the hearing6. That attendance was permitted by s 70 of the COA. The COPIM made submissions. The Supreme Court made the declaration sought. All or part of the information, the subject of the declaration, is relied upon in support of the grounds of the substantive application. The substantive application for a declaration that the respondents are a criminal organisation is pending. Two particular provisions of the COA, in issue in these proceedings, will affect the conduct of that application. They are: Section 76, which provides that an informant who has furnished criminal intelligence to a relevant agency cannot be called or otherwise required to give evidence although an affidavit must be filed by an officer of the relevant agency containing specified information about the informant, a statement that the officer believes that the relevant intelligence is reliable, and the reasons for that belief. Section 78, which requires that the Supreme Court order that any part of the hearing of the substantive application in which declared criminal intelligence is to be considered is to be a closed hearing to the extent provided under that section, which would exclude the respondents and their legal representatives but not the applicant or the COPIM. The respondents raised contentions about the validity of a number of the provisions of the COA, which have been referred to. On 5 October 2012, so much of the application as concerned the validity of provisions of the COA was removed into this Court pursuant to s 40(1) of the Judiciary Act 1903 (Cth) by order of this Court (French CJ and Crennan J)7. On 26 October 2012, Kiefel J referred for hearing by a Full Court, an agreed Special Case setting out questions for determination by the Court. The questions in the Special Case The questions in the Special Case are as follows: 6 The functions of the COPIM are described at [52] of these reasons. [2012] HCATrans 242. iii. Is s 66 of the Criminal Organisation Act, by requiring the Court to hear an application is criminal intelligence without notice of the application being given to the person or organisation to which the information relates, invalid on the ground that it infringes Chapter III of the Constitution? that particular information Is s 70 of the Criminal Organisation Act, by requiring the Supreme Court to exclude all persons other than those listed in s 70(2) from the hearing of an application for a declaration that particular information is criminal intelligence, invalid on the ground that it infringes Chapter III of the Constitution? Is s 78 of the Criminal Organisation Act, by requiring a closed hearing of any part of the hearing of the substantive application in which the court is to consider declared criminal intelligence, invalid on the ground that it infringes Chapter III of the Constitution? Is s 76 of the Criminal Organisation Act, by providing that: an informant who provides criminal intelligence to an agency may not be called or otherwise required to give evidence; an originating application and supporting material need not include any identifying information about an informant; and identifying information can not otherwise be required to be given to the court, invalid on the ground that it infringes Chapter III of the Constitution? Is s 10 of the Criminal Organisation Act, insofar as it requires the Court to have regard to information that is declared criminal legal intelligence which a representative has not heard or received because of the effect of ss 66, 70, 76, 77, 78, 82 and 109 of the Criminal Organisation Act, and when read with ss 63(5), 64(2), 64(8), 65(4), 71(2) and 80(2), invalid on the ground that it infringes Chapter III of the Constitution? respondent or a respondent's Is s 10(1)(c) of the Criminal Organisation Act invalid on the ground that it infringes Chapter III of the Constitution because of the nature of the judgment that it requires the Court to make? vii. Is s 9 of the Criminal Organisation Act, when read with s 8(5) and s 106, invalid on the ground that it infringes Chapter III of the Constitution? viii. Who should pay the costs of the special case?" It is necessary now to have regard to particular features of the COA. Nature and validity of the power to declare a criminal organisation The power of the Supreme Court to make a declaration that an organisation is a criminal organisation is conferred upon it by s 10(1) of the COA, which provides: "The court may make a declaration that the respondent is a criminal organisation if the court is satisfied that— the respondent is an organisation; and (b) members of the organisation associate for the purpose of engaging in, or conspiring to engage in, serious criminal activity[8]; and the organisation is an unacceptable risk to the safety, welfare or order of the community." The grounds set out in s 10(1) were reproduced, in substance, as the grounds of the application in this case. Information to which the Supreme Court must have regard when considering whether or not to make a declaration is set out in s 10(2). That includes "information" suggesting that a link exists between the organisation and serious criminal activity9. It also includes any convictions of current or former members of the organisation10. The declaration may be made whether or not the respondent is present or makes submissions11. It is not necessary that the Supreme Court be satisfied that "Serious criminal activity" is a term defined by reference to the commission of serious criminal offences in and outside Queensland: COA, s 6. "Serious criminal offences" are indictable offences punishable by imprisonment for at least seven years, offences against the COA and offences against specified sections of the Criminal Code (Q) set out in Sched 1 to the COA: COA, s 7. 9 COA, s 10(2)(a)(i). 10 COA, s 10(2)(a)(ii). 11 COA, s 10(3). all members of the organisation associate for the purposes of engaging in, or conspiring to engage in, serious criminal activity12. The Supreme Court may act on the basis of satisfaction that only some of the members associate for the purposes mentioned in s 10(1)(b). A declaration remains in force for five years unless sooner revoked13. The Supreme Court is empowered to revoke a declaration on an application which may be made by the Commissioner at any time or by the criminal organisation or a member of the criminal organisation at least three years after the declaration is made14. No more than two such applications can be made on behalf of the organisation or its members during the first five years after the declaration is made15. The only ground upon which a declaration may be revoked under s 13 of the COA is the Supreme Court's satisfaction that there has been a substantial change in the nature or membership of the organisation to the extent that its members no longer associate for the purpose of engaging in, or conspiring to engage in, serious criminal activity and to the extent that the organisation no longer represents an unacceptable risk to the safety, welfare and order of the community16. That is not to say that the inherent powers of the Supreme Court to revoke its own orders under certain circumstances are excluded. Those powers are discussed later in these reasons. The respondents challenge the validity of s 10(1)(c), which requires that before the Supreme Court may make a declaration under s 10 it must be satisfied that the organisation the subject of the proposed declaration is "an unacceptable risk to the safety, welfare or order of the community." The challenge to s 10(1)(c) effectively calls into question the validity of s 10. Section 10(1)(c) was said by the respondents to require a policy assessment devoid of adequate legal standards or criteria capable of judicial application to established facts. It thereby lacked a "hallmark of the judicial process". The respondents submitted that the application of the criterion in s 10(1)(c) did not involve the exercise of judicial power. The Supreme Court was being asked to act as an "administrative commission of inquiry" rather than to undertake a judicial function. It would be identified with the Executive Government of the State in a way that was incompatible with its institutional 12 COA, s 10(4). 13 COA, s 12(1). 14 COA, s 15(1). 15 COA, s 15(2). 16 COA, s 13(9). integrity as a court upon which federal judicial power could be conferred. That submission should not be accepted and the answer to question (vi), to which it was directed, should be "no". The first point, and there was no submission to the contrary, is that there is no implication to be drawn from Ch III of the Constitution that State courts are subject to the full doctrine of separation of powers17. Various attempts to argue in State courts for separation of powers doctrines derived from State Constitutions have failed18. The conferral upon the Supreme Court of a State of a non-judicial function is not sufficient to cause the Supreme Court to be identified with the Executive Government of the State. In any event, the power conferred upon the Supreme Court of Queensland by s 10(1) of the COA is a power which, when exercised by a court, can properly be characterised as judicial. The conferring upon a court of such a power is not of itself likely to impair the defining characteristics of the court. That observation does not involve any assumption that State judicial power is defined in the same terms as Commonwealth judicial power or that its scope is larger. That question was not debated19. The criterion of "unacceptable risk to the safety, welfare or order of the community" prescribed by s 10(1)(c) is evaluative and purposive. It does not leave the Supreme Court free to characterise as "unacceptable" any level of risk 17 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 65 per Brennan CJ, 79 per Dawson J, 92–94 per Toohey J, 103–104 per Gaudron J, 109– 110 per McHugh J; [1996] HCA 24; Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 573 [69]; [2010] HCA 1; Public Service Association and Professional Officers' Association Amalgamated (NSW) v Director of Public Employment (2012) 87 ALJR 162 at 175 [57] per Hayne, Crennan, Kiefel and Bell JJ; 293 ALR 450 at 466; [2012] HCA 58. 18 Clyne v East (1967) 68 SR (NSW) 385; Nicholas v Western Australia [1972] WAR 168; Gilbertson v South Australia (1976) 15 SASR 66; Building Construction Employees and Builders' Labourers Federation of NSW v Minister for Industrial Relations (1986) 7 NSWLR 372; City of Collingwood v Victoria [No 2] [1994] 1 VR 652; see generally Carney, The Constitutional Systems of the Australian States and Territories, (2006) at 344–349. 19 It was argued in In re Judiciary and Navigation Acts (1921) 29 CLR 257; [1921] HCA 20 that the advisory opinions jurisdiction invalidly conferred upon this Court involved judicial power but not the judicial power of the Commonwealth. Ultimately the case was resolved by reference to the concept of a matter, see R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 274; [1956] HCA 10; Stellios, "Reconceiving the Separation of Judicial Power", (2011) 22 Public Law Review 113 at 117–119. which it chooses. In applying s 10(1)(c), the Supreme Court will necessarily have regard to the objects of the COA, which include the disruption and restriction of the activities of organisations involved in serious criminal activity20. While s 10(1)(b) requires the Supreme Court to consider the present activities of the respondent organisation, s 10(1)(c) is prospective. The Supreme Court in applying it in light of the objects of the COA will assess, as an important if not dominant component of risk, the likelihood that the organisation and its members will be involved in serious criminal activity in the future. The term "unacceptable" has a function similar to that of the term "substantial" in other statutory settings. It imports a requirement that the likelihood of continuing involvement by the organisation in serious criminal activity is not trivial or transient. The criterion in s 10(1)(c) for the exercise of the power conferred by s 10(1) is imprecise but that does not deprive it of the character of judicial power. As the plurality said in Baker v The Queen21: "There are numerous authorities rejecting submissions that the conferral of powers and discretions for exercise by imprecisely expressed criteria do deny the character of judicial power and involve the exercise of authority by recourse to non-legal norms." The same point was made in Thomas v Mowbray22 about the criterion for the imposition of an interim control order under the Criminal Code (Cth), which required a judgment that the order would "substantially assist in preventing a terrorist act"23. Broadly stated standards are commonplace in statutes and in the common law and, as Professor Zines observed24 in a passage quoted in Thomas: "Given a broad standard, the technique of judicial interpretation is to give it content and more detailed meaning on a case to case basis." Section 10 is not invalid by reason of s 10(1)(c) and that paragraph is not invalid. 20 COA, s 3(1). 21 (2004) 223 CLR 513 at 532 [42]; [2004] HCA 45. 22 (2007) 233 CLR 307; [2007] HCA 33. 23 (2007) 233 CLR 307 at 323 [1]. 24 Zines, The High Court and the Constitution, 4th ed (1997) at 195 cited in Thomas v Mowbray (2007) 233 CLR 307 at 351 [91] per Gummow and Crennan JJ; see also at 334 [28] per Gleeson CJ, 507 [595] per Callinan J as to criteria involving risk assessments. In considering the other questions in the Special Case, it is necessary to have regard to what is at stake for the respondents. A declaration that an organisation is a criminal organisation does not have any coercive operation. However, such a declaration, if made, would have significant legal consequences for the organisation and its members. Legal consequences of a criminal organisation declaration A declaration that an organisation is a criminal organisation enlivens or informs the exercise of powers conferred on the Supreme Court to make coercive orders under the COA and in particular control orders, public safety orders and fortification removal orders. An outline of the nature of those orders and their connection to a criminal organisation declaration under s 10 follows. Part 3 of the COA provides for control orders. The Commissioner may apply for a control order against a person under s 16. The Supreme Court may make such an order if it is satisfied that the respondent in relation to whom the application is made25: is, or has been, a member of a criminal organisation; and engages in, or has engaged in, serious criminal activity; and associates with any person for the purpose of engaging in, or conspiring to engage in, serious criminal activity." Alternatively, the Supreme Court can make a control order against a person who is not a member of a criminal organisation but engages in, or has engaged in, serious criminal activity and associates with any member of a criminal organisation for the purpose of engaging in, or conspiring to engage in, serious criminal activity26. The content of the control order is found in the conditions imposed on the respondent by the Supreme Court pursuant to s 19 including, as a mandatory condition, a prohibition on the respondent from associating with any person who is a member of a criminal organisation27. On its face, s 19, read with s 10, has the effect that the content of that prohibition, effected by a control order, expands whenever another organisation is declared to be a criminal organisation. 25 COA, s 18(1). 26 COA, s 18(2). 27 COA, s 19(5)(a). Part 4 of the COA provides for the Supreme Court to make a public safety order for a person or a group of persons if satisfied that their presence at premises or an event, or within an area, poses a serious risk to public safety or security and that making the order is appropriate in the circumstances28. A mandatory relevant consideration is whether the respondent is or has been a member of a criminal organisation, or associates, or has associated, with a member of a criminal organisation29. A public safety order may prohibit the respondent from entering or remaining in stated premises or in a stated area or attending or remaining at a stated event30. Part 5 of the COA provides for fortification removal orders. The respondent to an application for such an order must be a person or organisation who is, alone or with others, an occupier of the fortified premises31. One of the criteria enlivening the discretion of the Supreme Court to make a fortification removal order is that the fortified premises are owned or habitually occupied or used by a criminal organisation or a member, prospective member, or an associate of a criminal organisation32. A declaration under s 10 provides a foundation for orders to be made under the COA which significantly affect the common law freedoms of individuals and the interests of the organisation to which the declaration applies. In the ordinary course procedural fairness would require that the organisation be given the opportunity to know and be able to answer all the allegations and evidence and submissions which are put forward to support such a declaration33. Nevertheless, in respect of evidence declared by the Supreme Court to be "criminal intelligence", the COA diminishes the procedural protections ordinarily 28 COA, s 28(1). 29 COA, s 28(2)(b). 30 COA, s 29(2). 31 COA, s 41(2). 32 COA, s 43(1)(b)(ii). 33 Kioa v West (1985) 159 CLR 550 at 629 per Brennan J; see also at 569 per Gibbs CJ, 582 per Mason J, 602 per Wilson J, 633 per Deane J; [1985] HCA 81; Annetts v McCann (1990) 170 CLR 596 at 598 per Mason CJ, Deane and McHugh JJ; [1990] HCA 57. See also Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 61 [51] per McHugh, Gummow and Hayne JJ; [2005] HCA 50; Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252 at 258 [11]; [2010] HCA 23. attendant upon the reception of evidence34. The COA mandates an ex parte application and a special closed hearing to determine whether information should be declared criminal intelligence and closed hearings excluding respondent organisations where criminal intelligence is subsequently tendered. The criminal intelligence application The objects of Pt 6 of the COA, which provides for criminal intelligence declarations, are set out in s 60. They are to: allow evidence that is or contains criminal intelligence to be admitted in applications under this Act without the evidence— prejudicing criminal investigations; or enabling the discovery of the existence or identity of confidential sources of law enforcement; or information relevant (iii) endangering anyone's life or physical safety; and prohibit the unlawful disclosure of particular criminal intelligence." The definition of "criminal intelligence" has been set out earlier. The COA provides for the Commissioner to apply to the Supreme Court for a declaration that particular information is criminal intelligence35. The Supreme Court may make such a declaration if so satisfied36. That power is discretionary. In exercising that discretion the Supreme Court may have regard to whether the possible adverse outcomes of disclosure of the evidence mentioned in s 60(a) outweigh any unfairness to a respondent37. Section 66 requires that application for a declaration that information is criminal intelligence be made without notice to any person or organisation to which the information relates. Section 70 requires that the application be heard in a closed court. The validity of ss 66 and 70 is the subject of questions (i) and (ii) in the Special Case. 34 A diminution which was described in the Explanatory Notes to the Criminal Organisation Bill 2009 as a "necessary abrogation of natural justice": Queensland, Legislative Assembly, Criminal Organisation Bill 2009, Explanatory Notes at 3. 35 COA, s 63(1). 36 COA, s 72(1). 37 COA, s 72(2). The Supreme Court must order that any part of the hearing of a substantive application under the COA in which declared criminal intelligence is to be considered, must be a closed hearing to the extent provided by s 78 of the COA38. The validity of ss 78 and 76, which respectively put in place procedures to protect such information and the identities of informants providing it, is challenged in questions (iii) and (iv) in the Special Case. The validity of s 10 is challenged in question (v) insofar as it may be taken to require the Court to have regard to declared criminal intelligence in deciding whether or not to make a declaration that an organisation is a criminal organisation. The respondents put a rather tangential argument that the provisions of the COA relating to criminal intelligence would allow material which is not admissible evidence to be put before the Supreme Court in a substantive application under the COA. However, as appears below and subject to one qualification, the rules of evidence are generally applicable in substantive proceedings under the COA. Application of the rules of evidence In support of their argument that the COA abrogated the rules of evidence, the respondents pointed to s 10(2), which requires the Supreme Court, in an application for a criminal organisation declaration, to have regard to certain "information" before the Supreme Court39 and "anything else the court considers relevant."40 The submission appeared to be linked to question (v) in the Special Case although the focus of that question is upon the requirement, said to flow from s 10(2), that the Supreme Court have regard to declared criminal intelligence which neither legal representative would have heard or received. The applicant submitted that the rules of evidence apply on the hearing of such an application. respondents nor respondents' the the The reference in s 10(2) to "information" to which the Supreme Court must have regard is to be read in the light of ss 8(3) and 107(1) of the COA. Section 8(3) requires that an application for a criminal organisation declaration be accompanied by "any affidavit the commissioner intends to rely on at the hearing of the application." Section 107(1) requires that an affidavit relied on in an application under the COA "may only contain a matter if direct oral evidence of the matter would be admissible." That requirement is qualified in one respect by s 107(2). An affidavit authorised under s 61 that has been admitted in evidence in an application for a criminal intelligence declaration "may also be 38 COA, s 78(1). 39 COA, s 10(2)(a). 40 COA, s 10(2)(b). admitted in evidence in the proceedings for the substantive application." Section 61 provides that an affidavit relied upon by the Commissioner in an application for a criminal intelligence declaration may contain statements based on information and belief if the deponent states the sources of the information and the grounds for the belief. The section removes a bar to admissibility that would otherwise exist by reason of the hearsay nature of such evidence. It does not overcome the requirement that the evidence be relevant. It does not require the Supreme Court to admit such an affidavit. Indeed, the leave of the Supreme Court would be required before the Commissioner could rely upon such an affidavit. That requirement is imposed by r 395 of the Uniform Civil Procedure Rules 1999 (Q) ("the UCPR"), which apply in relation to applications made to the Supreme Court under the COA to the extent that they are consistent with the COA41. Rule 395 of the UCPR allows a party in a proceeding before the Supreme Court, with the leave of the Court, to rely on evidence given or an affidavit filed in another proceeding or at an earlier stage of the same proceeding. Nothing in the COA excludes the application of that rule. The leave requirement imposed by r 395 is, on its face, applicable to the use, in a criminal organisation declaration application, of an affidavit used in a criminal intelligence declaration application. Section 107(2) does not overcome that requirement, dealing as it does only with the admissibility of such affidavits where they contain hearsay evidence. The Supreme Court, when hearing an application for a criminal organisation declaration, may have regard to the probative value of the hearsay material contained in such an affidavit and the unfairness, if any, worked by admitting it. Even if such an affidavit were admitted the Supreme Court would still have to determine what, if any, weight was to be given to it. The objects of Pt 6 of the COA, relating to criminal intelligence, are stated in s 60 in terms of the admission of "evidence" in applications under the COA. The COA does not, as a general proposition, displace the operation of the rules of evidence in an application for a declaration that an organisation is a criminal organisation. Nor should it be taken, in the absence of clear words, to displace the inherent powers of the Supreme Court. The inherent powers and the UCPR The Supreme Court Constitution Amendment Act 1861 (Q) established the Supreme Court of Queensland as "a Court of Civil and Criminal Jurisdiction which Court shall be a Court of Record." The Supreme Court Act 1863 (Q) ("the 1863 Act") declared that the Court had all the jurisdiction formerly exercised by the Supreme Court of New South Wales within the territory of the Colony of 41 COA, s 101. Queensland. The 1863 Act was replaced by the Supreme Court Act 1867 (Q) which, by s 21, provided that the Supreme Court would "have the same jurisdiction power and authority as the Superior Courts of Common Law and the High Court of Chancery in England". That jurisdiction and those powers continue42. In addition, the Constitution of Queensland 2001 (Q) provides that the Supreme Court is "the superior court of record in Queensland and the supreme court of general jurisdiction in and for the State"43. It has "all jurisdiction necessary for the administration of justice in Queensland"44 and, subject to the Commonwealth Constitution, has "unlimited jurisdiction at law, in equity and otherwise."45 The jurisdiction of the Supreme Court defined by the Supreme Court of Queensland Act 1991 (Q) and the Constitution of Queensland incorporates, by reference, the inherent jurisdiction of the Courts of Common Law and Chancery, which is "the inherent power necessary to the effective exercise of the jurisdiction granted."46 That is not to say that statutory incorporation of those powers was necessary. Menzies J observed in R v Forbes; Ex parte Bevan47 that the inherent jurisdiction is "the power which a court has simply because it is a court of a particular description."48 Dawson J, who reproduced that description 42 The jurisdiction and powers are continued by operation of s 11(1) of the Supreme Court of Queensland Act 1991 (Q). That Act was amended by s 181 of the Civil Proceedings Act 2011 (Q) following the repeal of the Supreme Court Act 1995 (Q) by s 211 of the 2011 Act. Section 11(1) of the 1991 Act provides that the Supreme Court "retains all the jurisdiction and power that may have been derived from the 1995 Act or any of the Acts referred to in the 1995 Act." 43 Constitution of Queensland 2001 (Q), s 58(2)(a). 44 Constitution of Queensland 2001 (Q), s 58(1). 45 Constitution of Queensland 2001 (Q), s 58(2)(b). 46 Keramianakis v Regional Publishers Pty Ltd (2009) 237 CLR 268 at 280 [36]; [2009] HCA 18. 47 (1972) 127 CLR 1; [1972] HCA 34. 48 (1972) 127 CLR 1 at 7. in Grassby v The Queen49, acknowledged the "elusive" character of inherent "it is undoubtedly the general responsibility of a superior court of unlimited jurisdiction for the administration of justice which gives rise to its inherent power. In the discharge of that responsibility it exercises the full plenitude of judicial power." His Honour observed of the Supreme Court of New South Wales, in terms applicable to the Supreme Court of Queensland51: "Although conferred by statute, its powers are identified by reference to the unlimited powers of the courts at Westminster." The inherent jurisdiction of superior courts of record was described in Master Jacob's frequently cited Hamlyn lecture on the topic as something which flows from the essential character of such courts52: "the essential character of a superior court of law necessarily involves that it should be invested with a power to maintain its authority and to prevent its process being obstructed and abused. Such a power is intrinsic in a superior court; it is its very life-blood, its very essence, its immanent attribute." Another explanation proffered in another influential article is that "inherent powers arise at common law when they are necessary if the court or tribunal in question is to be able to manage its activities appropriately."53 49 (1989) 168 CLR 1; [1989] HCA 45. 50 (1989) 168 CLR 1 at 16, Mason CJ and Brennan J agreeing at 4, Toohey J agreeing at 21, Deane J relevantly agreeing at 5. The same passage was approved in Pelechowski v Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 at 451 [50] per Gaudron, Gummow and Callinan JJ; [1999] HCA 19. 51 (1989) 168 CLR 1 at 16. 52 Jacob, "The Inherent Jurisdiction of the Court", (1970) 23 Current Legal Problems 23 at 27, cited by the Supreme Court of Canada in MacMillan Bloedel Ltd v Simpson [1995] 4 SCR 725 at 749–750 [30] per Lamer CJ. See also Whan v McConaghy (1984) 153 CLR 631 at 642 per Brennan J; [1984] HCA 22; John Fairfax & Sons Ltd v Police Tribunal of New South Wales (1986) 5 NSWLR 465 at 476 per McHugh JA; R v Moke [1996] 1 NZLR 263 at 267. The extent, if any, to which the inherent powers of the Supreme Courts of the States are protected from statutory derogation by Ch III of the Constitution, was not in issue in these proceedings54. However, the nature and purpose of those powers indicate that they are not, as a rule, displaced or abrogated by general words in a statute nor by statutory provisions or rules which overlap with them. Rich J said in Cameron v Cole55: "in the absence of clear words, a statute should not be treated as depriving a court of the inherent jurisdiction possessed by every court to ensure that trials before it are conducted in accordance with the principles of natural justice." Early in the life of this Court Griffith CJ remarked that56: "Rules and forms of procedure are not ends in themselves, but means to an end, which is the attainment of justice." It follows from that uncontroversial proposition, as Mr Keith Mason observed in an article on the topic of inherent jurisdiction in the Australian Law Journal57: "that the mere fact that a statute or rule of court addresses itself in a particular way to a particular matter does not usually exclude by implication a superior court's wider inherent powers relating to that matter if they are appropriate." The inherent powers relevant to these proceedings include the power of the Supreme Court to prevent abuse of its processes by revoking an ex parte order against a party when the party seeking the order has failed to discharge its 53 Dockray, "The Inherent Jurisdiction to Regulate Civil Proceedings", (1997) 113 Law Quarterly Review 120 at 127. 54 See Lacey, "Inherent Jurisdiction, Judicial Power and Implied Guarantees under Chapter III of the Constitution", (2003) 31 Federal Law Review 57; Beck, "What is a 'Supreme Court of a State'?", (2012) 34 Sydney Law Review 295; see also Batistatos v Roads and Traffic Authority (NSW) (2006) 226 CLR 256 at 296–298 [124]–[135] per Kirby J; [2006] HCA 27. 55 (1944) 68 CLR 571 at 589; [1944] HCA 5. 56 Union Bank of Australia v Harrison, Jones & Devlin Ltd (1910) 11 CLR 492 at 504; [1910] HCA 44. 57 Mason, "The Inherent Jurisdiction of the Court", (1983) 57 Australian Law Journal 449 at 457; see also authorities there cited. obligation of full disclosure58. It was not in dispute that if, in the course of a substantive application under the COA in which reliance was placed upon criminal intelligence, it emerged that there had not been full disclosure by the applicant, the Supreme Court could revoke its ex parte declaration. The question whether a court has inherent power to call witnesses of its own motion without the consent of the parties in civil and criminal cases has been the subject of consideration in a number of decisions of this Court and other Australian courts. The existence of the power has fallen for consideration in the framework of the adversary or accusatorial system of justice. The essential feature of that system was described in the 8th Australian edition of Cross on Evidence as59: "the questioning of witnesses by the parties or their representatives, summoned for the most part by them, and called mainly in the order of their choice before a judge acting as umpire rather than as inquisitor." It is not necessary to explore decisions on the question or the current position in civil and criminal cases60. Where, however, a statute requires the Supreme Court to undertake an ex parte inquisitorial process, the Supreme Court, unless and to the extent precluded by the statute61, will retain its inherent power to control that process in order to avoid its abuse and to avoid injustice. That power will extend to the calling of a witness or witnesses necessary to ensure that so far as practicable the Supreme Court is not acting upon information which is incomplete in some important respect. In any event, r 391 of the UCPR provides that the Supreme Court may "by order and on its own initiative, call a person before it as a witness in a 58 As to the obligation of full disclosure see Thomas A Edison Ltd v Bullock (1912) 15 CLR 679 at 681–682 per Isaacs J; [1912] HCA 72. 59 Cross on Evidence, 8th Aust ed (2010) at [17070]. 60 See Titheradge v The King (1917) 24 CLR 107; [1917] HCA 76; Shaw v The Queen (1952) 85 CLR 365 at 379 per Dixon, McTiernan, Webb and Kitto JJ; [1952] HCA 18; R v Apostilides (1984) 154 CLR 563 at 575 per Gibbs CJ, Mason, Murphy, Wilson and Dawson JJ; [1984] HCA 38; R v Soma (2003) 212 CLR 299 at 309 [29] per Gleeson CJ, Gummow, Kirby and Hayne JJ; [2003] HCA 13. See generally Sheppard, "Court Witnesses—A Desirable or Undesirable Encroachment on the Adversary System?", (1982) 56 Australian Law Journal 234. 61 Whether such a preclusion gives rise to a question of validity is not considered in these reasons. proceeding."62 The Supreme Court may give directions about the examination, cross-examination and re-examination of such a witness63. There is nothing in the COA to exclude the exercise of the application of that rule in the special closed hearings and closed hearings for which the COA provides. As noted earlier, the UCPR apply to applications in the Supreme Court under the COA to the extent that they are consistent with it64. The subsistence of the inherent and rules-based powers is relevant to the question whether the impugned provisions of the COA impair the defining and essential characteristics of the Supreme Court. That question must be answered by considering those provisions in the common law and statutory context in which they operate. An aspect of the inherent jurisdiction relevant, in a different way, to the constitutional question is the group of powers that courts have to order that all or part of a case be heard in camera, to prohibit publication of part of the proceedings, and to privately inspect documents the subject of a claim for public interest immunity65. The existence of that group of inherent powers suggests that statutory analogues will not readily be regarded as impairing the defining or essential characteristics of the courts to which those analogues apply. The provisions of the COA relating to an application for a criminal intelligence declaration are analogous to those common law powers. A requirement for special closed hearings in which evidence can be received in the absence of a party and its representatives travels beyond the procedures developed for determining public interest immunity claims at common law in the exercise of inherent powers. A majority of the Supreme Court of the United Kingdom in Al Rawi v Security Service66 found such a requirement proposed by a trial court, coupled with a direction for the appointment of a special advocate, to be a bridge too far. A trial court (in the exercise of civil jurisdiction) was held not to have inherent power to direct a closed material procedure in which evidence relevant to the claim, but involving national security concerns, would be tendered by the defendant government party 62 UCPR, r 391(1). 63 UCPR, r 391(2). 64 COA, s 101. 65 Sankey v Whitlam (1978) 142 CLR 1 at 43 per Gibbs ACJ, 63–64 per Stephen J, 98–99 per Mason J; [1978] HCA 43; The Commonwealth v Northern Land Council (1993) 176 CLR 604 at 616–617 per Mason CJ, Brennan, Deane, Dawson, Gaudron and McHugh JJ; [1993] HCA 24; Hogan v Hinch (2011) 243 CLR 506 at 541–542 [46] per French CJ; [2011] HCA 4. to the court in the absence of the plaintiffs. Lord Dyson observed that the inherent power of the courts had underpinned the development of procedural innovations such as Mareva injunctions, Anton Piller orders and the mechanism for determining public interest immunity claims. However, subject to established and limited exceptions, those powers could not be used by a court 67: "to regulate its own procedures in such a way as will deny parties their fundamental common law right to participate in the proceedings in accordance with the common law principles of natural justice and open justice." The respondents cited Al Rawi in support of the proposition that the task undertaken by the Supreme Court under the COA does not involve the exercise of judicial power because the process applied is not recognisable as a traditional judicial process and the risk assessment which the Supreme Court is required to undertake is an executive rather than judicial function. For the reasons already given, the last mentioned submission cannot be accepted. Nor does Al Rawi provide an answer to the constitutional questions raised in the Special Case. It is not necessary to decide whether the Supreme Courts of the States and Territories have an inherent power to direct a closed material procedure of the kind considered in that case. Consideration of that question may involve consideration of the constitutional relationships between the courts of the States and the State Parliaments in a context materially different from that applicable in Al Rawi. No party to these proceedings suggested that they do. No party pointed to anything in the inherent powers which could be regarded as an analogue of the special closed hearing procedure for which the COA provides in relation to the receipt of criminal intelligence in substantive applications. However, the absence of such an analogue does not determine the constitutional questions about the statutory procedure. The proposed closed material procedure rejected by the Supreme Court in Al Rawi involved the appointment of a special advocate to represent the interests of absent plaintiffs. The COA provides an imperfect analogue to that office in the form of the COPIM, which is considered next. The COPIM The office of the COPIM is created by Pt 7 of the COA. The role of the COPIM was described in the Explanatory Notes to the Criminal Organisation 67 [2012] 1 AC 531 at 575 [22]. Bill as "in the nature of amicus curiae" who would "assist the court in making a decision as an independent and impartial tribunal."68 to monitor each criminal The functions of the COPIM as set out in s 86 of the COA are to "monitor" applications to the Supreme Court for a criminal organisation order or for intelligence application70 and "to test, and make submissions to the court about, the appropriateness and validity of the monitored application."71 At any hearing for an application at which the COPIM appears, the applicant is required to furnish the COPIM, as soon as reasonably practicable, with "all material given by the applicant to the court."72 That obligation does not extend to material disclosing any identifying information about an informant73. The COPIM is obliged to keep the material secure and return it to the applicant74. The COPIM is entitled to access to a record or transcript of a record of a hearing at which the COPIM appears75. At a hearing the COPIM may, for the purpose of testing the appropriateness and validity of the application, "present questions for the applicant to answer"76, "examine or cross-examine a witness"77 and make submissions to the Supreme Court about the appropriateness of granting the application78. The COPIM is not permitted to make a submission while a respondent or legal representative of a respondent is present 79 and may be excluded from the hearing, in the Supreme Court's discretion, while a respondent 68 Queensland, Legislative Assembly, Criminal Organisation Bill 2009, Explanatory Notes at 3. 69 COA, s 86(a). 70 COA, s 86(b). 71 COA, s 86(c). 72 COA, s 88(1). 73 COA, s 88(2). 74 COA, s 88(4). 75 COA, s 88(5). 76 COA, s 89(2)(a)(i). 77 COA, s 89(2)(a)(ii). 78 COA, s 89(2)(b). 79 COA, s 89(3). or a legal representative of a respondent is present80. There is no express prohibition upon communication between the respondent's legal representative and the COPIM to better inform the COPIM for the purpose of the discharge of his or her functions in proceedings under the COA which affect the interests of the respondent. There are prohibitions affecting the ability of a lawyer appointed as COPIM to act for organisations or individuals who are or have been respondents to applications under the COA, in proceedings in which the COPIM obtained criminal intelligence about the organisation or the individual81. The COPIM must prepare an annual report to the Minister about the performance of the COPIM's functions under the COA82. The COPIM's performance is subject to review by a parliamentary committee which also has the function of examining each annual report83. As appears from the above, the COPIM does not act as an advocate for the interests of any respondent to applications in which the COPIM may be required to appear. The position of the COPIM resembles, to a very limited extent, that of the specially appointed advocates used in some jurisdictions in which closed ex parte hearings are held by courts or tribunals under statutory authority to consider material, the disclosure of which might prejudice national security, criminal investigations, or the identity and safety of informants, or otherwise be contrary to the public interest. Closed ex parte hearings and special advocates Statutory mechanisms, providing for closed ex parte hearings and specially appointed advocates, have been applied to courts and tribunals in the United Kingdom and Canada and have been considered by the European Court of Human Rights ("the European Court"). Examples of legislation containing such provisions were submitted to the Court by the Commonwealth. Reference to judicial consideration of those mechanisms may bear upon the normative question of whether the provisions in the COA for closed ex parte hearings, coupled with the use of the COPIM, constitutes an impermissible departure from the defining characteristics of the Supreme Court. It is, however, necessary in referring to those examples and judgments of other courts about them to do so 80 COA, s 89(4). 81 COA, s 90. 82 COA, s 92. 83 COA, s 91(1). with caution having regard to their different constitutional and statutory settings84. In Canada in the 1980s special advocates were appointed administratively by the Security Intelligence Review Committee ("the SIRC"), a statutory body which reviewed deportation orders made on national security grounds85. The history of the SIRC is set out in the judgment of McLachlin CJ in Charkaoui v Canada (Citizenship and Immigration)86. The non-citizen applying for review would be represented by the special advocate during parts of a hearing from which the non-citizen was excluded because evidence said to be confidential for national security reasons was being tendered. At the conclusion of the closed hearing the non-citizen would be readmitted and be provided with a summary setting out the gist of the evidence without disclosing sensitive material. The SIRC procedure was given glancing endorsement by the European Court in Chahal v United Kingdom87. The Court commented that88: "This example illustrates that there are techniques which can be employed which both accommodate legitimate security concerns about the nature and sources of intelligence information and yet accord the individual a substantial measure of procedural justice." (footnote omitted) As a result of the Chahal decision, the Special Immigration Appeals Commission ("the SIAC") was established in the United Kingdom as a superior court of record89. Its jurisdiction covered appeals against adverse immigration decisions involving national security issues. The Lord Chancellor was authorised to make rules enabling proceedings before the SIAC to take place in the absence 84 The transnational migration and mutations of the special advocate concept are discussed in Jenkins, "There and Back Again: The Strange Journey of Special Advocates and Comparative Law Methodology", (2011) 42 Columbia Human Rights Law Review 279. 85 Immigration Act 1985, RSC 1985, c I-2, s 39. 86 [2007] 1 SCR 350 at 392–395 [71]–[75]. 87 (1996) 23 EHRR 413. 88 (1996) 23 EHRR 413 at 469 [131]. The Court held that an administrative process for appeals from immigration decisions using a ministerial advisory panel with no right of representation did not comply with Art 5(4) of the European Convention on Human Rights. 89 Special Immigration Appeals Commission Act 1997 (UK), ss 1(1), 1(3). of the appellant and the appellant's legal representatives90. The legislation also provided for the appointment of a person to represent the interests of the appellant in such proceedings91. The person so appointed was "not ... responsible" to those whom he or she was appointed to represent92. Appeals lay to the Court of Appeal on questions of law93. A number of statutes providing for closed ex parte hearings and the use of special advocates have been enacted in the United Kingdom94. Both Canada and the United Kingdom have enacted statutes providing for the detention of persons on national security grounds but denying full disclosure of those grounds to the persons detained. In cases concerning the consistency of those provisions with human rights guarantees of a fair trial, the presence of a special advocate has been accorded some significance. Charkaoui95 involved a challenge, based on s 7 of the Canadian Charter of Rights and Freedoms96, to provisions of the Immigration and Refugee Protection Act ("the IRPA")97. The IRPA provided for a ministerial certificate authorising the detention of foreign nationals or permanent residents on national security grounds. The Act provided a procedure for judicial review of the certificate but 90 Special Immigration Appeals Commission Act 1997 (UK), s 5(3)(b). 91 Special Immigration Appeals Commission Act 1997 (UK), s 6(1). 92 Special Immigration Appeals Commission Act 1997 (UK), s 6(4). 93 Special Immigration Appeals Commission Act 1997 (UK), s 7. In the Court of Appeal in Al Rawi v Security Service the Master of the Rolls assumed that the Court of Appeal would have the same power to adopt the closed hearing and special advocate procedure as the SIAC had: [2012] 1 AC 531 at 552 [59] per Lord Neuberger MR. 94 Examples are cited in R v H [2004] 2 AC 134 at 149–150 [21] per Lord Bingham. 95 [2007] 1 SCR 350. 96 Section 7 of the Canadian Charter of Rights and Freedoms states: "Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice." 97 SC 2001, c 27. required the judge to hear the application in a closed court in the absence of the applicant. The Chief Justice, in delivering the judgment of the Court, said98: "the secrecy required by the scheme denies the named person the opportunity to know the case put against him or her, and hence to challenge the government's case. This, in turn, undermines the judge's ability to come to a decision based on all the relevant facts and law." The Court held that the procedure infringed s 7 of the Charter and could not be justified under s 1 of the Charter. In so concluding, the Court referred to "less intrusive alternatives" and, in particular, the use of special advocates by the SIRC and in the operation of the SIAC in the United Kingdom. The Chief Justice adopted an observation in an academic article that99: "special advocates constitute one example of an approach that is a more proportionate response to reconciling the need to keep some information secret and the need to ensure as much fairness and adversarial challenge as possible." Whether closed ex parte hearings and specially appointed advocates were compatible with the right to a fair hearing under Art 6(1) of the European Convention on Human Rights was considered by the House of Lords in Home Secretary v MB100. The case concerned provisions of the Prevention of Terrorism Act 2005 (UK) under which the Secretary of State could apply to a court to make control orders against persons suspected of involvement in terrorist activity. Rules made under the Act provided for non-disclosure of material upon which applications for such orders were based. Accepting that specially appointed advocates could help to enhance the measure of procedural justice available under such a system, Lord Bingham quoted Lord Woolf CJ's observation in R (Roberts) v Parole Board101 that102: "The use of [a specially appointed advocate] is ... never a panacea for the grave disadvantages of a person affected not being aware of the case against him." 98 [2007] 1 SCR 350 at 390 [65]. 99 [2007] 1 SCR 350 at 398 [82] citing Roach, "Ten Ways to Improve Canadian Anti- Terrorism Law", (2006) 51 Criminal Law Quarterly 102 at 120. 101 [2005] 2 AC 738 at 776 [60]. 102 [2008] AC 440 at 479–480 [35]. A majority of the House concluded that there was no rigid principle that closed hearings coupled with special advocates would invariably breach the right to a fair hearing. It was necessary in each individual case to consider whether the party excluded from the hearing had been offered "a substantial measure of procedural justice"103. Charkaoui and MB were decided in 2007. In 2009, the European Court considered the use of closed hearings and special advocates in A v United Kingdom104. It made reference to the two decisions of the Supreme Court of Canada and the House of Lords. This was the first case in which the Court was required to consider whether the use of special advocates to counter-balance procedural unfairness caused by lack of full disclosure in national security cases was compatible with Art 6. The Court unanimously declined to endorse the approach taken in MB, holding that an irreducible minimum of disclosure was necessary to satisfy the requirements of a fair trial. The special advocate would not overcome the unfairness caused by lack of full disclosure unless the detainee was provided with sufficient information about the allegations against him to enable him to give effective instructions to the special advocate105. As a result of the decision of the European Court in A, the use of special advocates in closed hearings was reconsidered by the House of Lords in Home Secretary v AF (No 3)106. Their Lordships accepted the approach taken by the European Court. judgment, acknowledged that the European Court107: Lord Phillips, who delivered leading the "has now made clear that non-disclosure cannot go so far as to deny a party knowledge of the essence of the case against him, at least where he is at risk of consequences as severe as those normally imposed under a control order." 103 A term derived from Chahal v United Kingdom (1996) 23 EHRR 413 at 469 [131] and invoked in Home Secretary v MB [2008] AC 440 at 481–482 [41] per Lord Bingham, 488–489 [66] per Baroness Hale, 493–494 [81] per Lord Carswell, 497–498 [90] per Lord Brown. 104 (2009) 49 EHRR 29. 105 (2009) 49 EHRR 29 at 720 [220]. 107 [2010] 2 AC 269 at 356 [65]. However, in Tariq v Home Office108 the Supreme Court of the United Kingdom held that a closed material procedure with special advocates, used in employment tribunals to deal with evidence involving national security, was in principle compatible with Art 6 of the European Convention. Moreover, it was not necessary, under Art 6, for a person to be provided with sufficient information about the allegations against him or her to enable the person to give effective instructions to a legal representative or to a special advocate109. A distinction was drawn between cases involving the liberty of the subject and those which do not. In the former case110: "If the special advocate is unable to perform his function in any useful way unless the detainee is provided with sufficient information about the allegations to enable him to give effective instructions to the special advocate, then there must be disclosure to the detainee of the gist of that information". There is an overlap between the question in these proceedings whether a closed material procedure impairs a defining characteristic of the court utilising it and the question agitated in the European Court and the House of Lords and the Supreme Court of the United Kingdom whether such a procedure is consistent with a fair hearing under Art 6. The greater the degree of procedural unfairness and of curial secrecy which is mandated by a statute, the greater the risk that the statute will impair defining characteristics of the court required to implement that unfairness and secrecy. The impugned provisions of the COA involve the use of the COPIM whenever the Supreme Court of Queensland is required to conduct closed ex parte hearings. While the provisions of the COA relating to the COPIM adopt a fairly minimalist approach to the protection of the respondent's interests, compared to the special advocate provisions mentioned in the preceding examples, they are relevant to the effect of the impugned provisions of the COA on the ability of the Supreme Court to provide procedural fairness. The issues The following issues emerged from the questions in the Special Case: 109 [2012] 1 AC 452 at 500 [69] per Lord Mance, 507 [83] per Lord Hope, 507–508 [85] per Lord Brown, 523 [137] per Lord Kerr, 523 [138] per Lord Dyson. 110 [2012] 1 AC 452 at 524 [143] per Lord Dyson. The effects of the COA, on the defining characteristics of the Supreme Court, insofar as it requires that an application for a declaration of criminal intelligence be heard ex parte in a closed court, the use of declared criminal intelligence in a closed court in substantive proceedings coupled with the exclusion of the respondent in that part of the proceedings, and the non-identification and non-compellability of informants providing such intelligence (questions (i) to (v)). The nature of the function conferred on the Supreme Court in determining whether to make a criminal organisation declaration and whether that function is compatible with its institutional integrity (question (vi)). The effect on procedural fairness of the limited time within which a respondent is required to file a reply to an application for a criminal organisation declaration (question (vii)). The applicable principles The respondents invoke the general principle, established in decisions of this Court, that a State legislature cannot confer upon a court of a State a function which impairs its institutional integrity and which is therefore incompatible with the role of that court as a repository of federal jurisdiction111. The "institutional integrity" of a court is said to be distorted if it no longer exhibits in some relevant aspect the defining characteristics which mark a court apart from other decision- making bodies112. The defining characteristics of courts include113: the reality and appearance of decisional independence and impartiality114; 111 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 96 per Toohey J, 106 per Gaudron J, 116–119 per McHugh J, 127–128 per Gummow J; Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 591 [15] per Gleeson CJ; [2004] HCA 46. 112 Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 76 [63]–[64] per Gummow, Hayne and Crennan JJ; [2006] HCA 44; Wainohu v New South Wales (2011) 243 CLR 181 at 208–209 [44] per French CJ and Kiefel J; [2011] HCA 24. 113 Wainohu v New South Wales (2011) 243 CLR 181 at 208–209 [44] per French CJ and Kiefel J and authorities there cited. 114 Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 343 [3] per Gleeson CJ, McHugh, Gummow and Hayne JJ, 373 [116] per Kirby J; [2000] HCA 63; North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 152 [3] per Gleeson CJ, 163 [29] per McHugh, Gummow, Kirby, Hayne, (Footnote continues on next page) the application of procedural fairness; adherence as a general rule to the open court principle115; the provision of reasons for the courts' decisions116. Those characteristics are not exhaustive. As Gummow, Hayne and Crennan JJ said in Forge v Australian Securities and Investments Commission117: "It is neither possible nor profitable to attempt to make some single all-embracing statement of the defining characteristics of a court. The cases concerning identification of judicial power reveal why that is so." The defining or essential characteristics of courts are not attributes plucked from a platonic universe of ideal forms. They are used to describe limits, deriving from Ch III of the Constitution, upon the functions which legislatures may confer upon State courts and the commands to which they may subject them. Those limits are rooted in the text and structure of the Constitution informed by the common law, which carries with it historically developed concepts of courts and the judicial function. Historically evolved as they are and requiring application in the real world, the defining characteristics of courts are not and cannot be absolutes. Decisional independence operates within the framework of the rule of law and not outside it118. Procedural fairness, manifested in the requirements that the court be and appear to be impartial and that parties be heard by the court, is defined by practical judgments about its content and application which may vary according to the circumstances. Both the open court principle and the hearing rule may be qualified by public interest Callinan and Heydon JJ; [2004] HCA 31; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 77 [66] per Gummow, Hayne and Crennan JJ; Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [10] per Gummow, Hayne, Heydon and Kiefel JJ; [2008] HCA 4. 115 Dickason v Dickason (1913) 17 CLR 50; [1913] HCA 77; Russell v Russell (1976) 134 CLR 495 at 520 per Gibbs J; [1976] HCA 23; Scott v Scott [1913] AC 417. 116 Wainohu v New South Wales (2011) 243 CLR 181 at 213–215 [54]–[56] per French CJ and Kiefel J and authorities there cited. 117 (2006) 228 CLR 45 at 76 [64]. 118 Public Service Association and Professional Officers' Association Amalgamated (NSW) v Director of Public Employment (2012) 87 ALJR 162; 293 ALR 450. considerations such as the protection of sensitive information and the identities of vulnerable witnesses, including informants in criminal matters. As is the case in other common law jurisdictions, the common law and statute law of Australia provide examples of circumstances in which the open court principle and the hearing rule have been qualified or partially abrogated. Gibbs J in Russell v Russell119 acknowledged that "there are established exceptions to the general rule that judicial proceedings shall be conducted in public"120. His Honour observed, in reasoning adopted by the plurality in Hogan v Hinch121, that the category of such exceptions is not closed to the legislature and that122: "The need to maintain secrecy or confidentiality, or the interests of privacy or delicacy, may in some cases be thought to render it desirable for a matter, or part of it, to be held in closed court." The ordinary rule of open justice in the courtroom may give way to the need for confidentiality in order to avoid prejudice to the administration of justice in cases in which publicity would destroy the subject matter of the litigation123. A statutory provision preventing disclosure to a party and restricting, for use by the court only, information which might prejudice police operations was held valid in Gypsy Jokers Motorcycle Club Inc v Commissioner of Police124. It was for the court to determine whether disclosure of the information might cause the asserted prejudice125. The restriction on the disclosure of the information in such a case was described by the plurality as "an outcome comparable with that of the common law respecting public interest 119 (1976) 134 CLR 495. 120 (1976) 134 CLR 495 at 520. 121 (2011) 243 CLR 506. 122 (2011) 243 CLR 506 at 553–554 [90] quoting Russell v Russell (1976) 134 CLR 495 at 520 per Gibbs J. 123 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 560–561 [41] per Gummow, Hayne, Heydon and Kiefel JJ citing Deane J in Australian Broadcasting Commission v Parish (1980) 29 ALR 228 at 255. 124 (2008) 234 CLR 532. 125 (2008) 234 CLR 532 at 558 [33] per Gummow, Hayne, Heydon and Kiefel JJ. immunity, but with the difference that the Court itself may make use of the information in question."126 As Crennan J said127: "the availability and accessibility of all relevant evidence in judicial proceedings is not absolute." Where a statute mandates that certain evidence used in a judicial proceeding will not be made available to one of the parties and procedural fairness is thereby qualified, the cautionary observation in Gypsy Jokers is applicable128: "As a general proposition, it may be accepted that legislation which purported to direct the courts as to the manner and outcome of the exercise of their jurisdiction would be apt impermissibly to impair the character of the courts as independent and impartial tribunals." (footnote omitted) While judgments as to validity will turn upon particular features of the impugned legislation, it is important to bear in mind that such judgments cannot be vehicles for imposing institutional uniformity on State judicial systems. The Parliaments of the States retain the legislative power to determine the constitution of their courts and the organisational arrangements through which those courts will exercise their jurisdiction and powers129. Criminal intelligence declaration—nature and validity The first element of the enquiry to be undertaken by the Supreme Court in an application for a criminal intelligence declaration is to determine whether the information, the subject of the application, is criminal intelligence as defined in s 59. Having regard to the definition of "criminal intelligence" in that section, the enquiry, as noted earlier, is analogous to that which courts have traditionally undertaken in the exercise of their inherent powers to determine whether material sought by a party to a proceeding under subpoena or discovery or some other 126 (2008) 234 CLR 532 at 559 [36]. 127 (2008) 234 CLR 532 at 597 [189]. 128 (2008) 234 CLR 532 at 560 [39] per Gummow, Hayne, Heydon and Kiefel JJ. 129 Le Mesurier v Connor (1929) 42 CLR 481 at 495–496 per Knox CJ, Rich and Dixon JJ; [1929] HCA 41; Adams v Chas S Watson Pty Ltd (1938) 60 CLR 545 at 554–555 per Latham CJ; [1938] HCA 37; Peacock v Newtown Marrickville and General Co-operative Building Society No 4 Ltd (1943) 67 CLR 25 at 37 per Latham CJ, McTiernan J agreeing at 47; [1943] HCA 13. court process, should not be produced in the public interest. In The Commonwealth v Northern Land Council130 the plurality said131: "If inspection of documents is necessary to determine the question of immunity … it ought to be carried out by the court before ordering production for inspection by a party." (footnote omitted) The duty of a court to inspect privately documents for which immunity from production is claimed and the circumstances in which that duty arises have been discussed in various decisions of this and other courts. It is not necessary to canvass them in these reasons132. Such decisions have been concerned with the process by which a court decides whether or not documents for which immunity is claimed should be produced to a party calling for them. The analogy relevant for present purposes is found in the ex parte feature of that process. The party resisting production will know what is in the documents. The party calling for them will not. The court will decide. Sometimes, but not always, the court will decide, with the assistance of the legal representative of the party calling for production, subject to directions or undertakings as to non-disclosure. In determining an application for a criminal intelligence declaration under the COA, the Supreme Court must first determine whether the criteria in s 59 are satisfied. They are important and substantive criteria which are not to be satisfied by pro forma affidavits containing conclusionary statements. The importance of the Supreme Court's judgment about them lies in its consequences for the conduct of subsequent substantive applications which, as pointed out earlier, may have significant legal effects upon the common law freedoms of many individuals and the property rights of organisations. While hearsay evidence is admitted by virtue of s 61 of the COA, consistently with the practice of the courts in relation to interlocutory applications, the weight to be given to such evidence will be a matter for the Supreme Court in determining whether it can be relied upon to support the findings necessary to enliven the power to make a criminal intelligence declaration. The power conferred by s 72 to make the declaration is discretionary and the Supreme Court is required to balance the outcomes of disclosure of the 130 (1993) 176 CLR 604. 131 (1993) 176 CLR 604 at 620 per Mason CJ, Brennan, Deane, Dawson, Gaudron and 132 See eg Sankey v Whitlam (1978) 142 CLR 1 at 42 per Gibbs ACJ, 62 per Stephen J; The Commonwealth v Northern Land Council (1993) 176 CLR 604 at 617; Alister v The Queen (1984) 154 CLR 404 at 414–415 per Gibbs CJ, 431 per Murphy J, 453 per Brennan J; [1984] HCA 85. evidence against the unfairness that a criminal intelligence declaration will work on a prospective respondent. To some extent that consideration will be hypothetical. The Supreme Court will not necessarily know of the organisations or individuals against whom the criminal intelligence will be used in substantive applications under the COA. Nor will it necessarily know what significance the declared criminal intelligence may have against other evidence tendered in a substantive application. The Supreme Court, in determining an application for a declaration that information is criminal intelligence, is assisted by the COPIM. The COPIM is under no legal duty to represent the interests of potential respondents to substantive applications in which the criminal intelligence may be used. Nevertheless, in making submissions as to the appropriateness or validity of the application, the COPIM will be bound to do so by reference to the statutory criteria upon which the Supreme Court must act. The COPIM's submissions may also direct attention to any apprehended failure on the part of the applicant to comply with its duty of disclosure and may propose to the Supreme Court that a witness or witnesses should be called by the applicant or by the Supreme Court itself. The effect of Pt 6 of the COA upon the normal protections of procedural fairness is significant. On the other hand, the Supreme Court performs a recognisably judicial function in determining an application under that Part. It is not able to be directed as to the outcome. It retains significant inherent powers and its powers under the UCPR in relation to the proceedings. The process is analogous in some respects to that used in the determination of public immunity claims in the exercise of the inherent power of the Supreme Court. The provisions of Pt 6 relating to an application for a criminal intelligence declaration do not impair the essential and defining characteristics of the Supreme Court so as to transgress the limitations on State legislative power derived from Ch III of the Constitution. Some contrast and comparisons may be made with State legislation the subject of two decisions of the High Court in recent years. One of those was International Finance Trust Co Ltd v New South Wales Crime Commission133. The vice of s 10 of the Criminal Assets Recovery Act 1990 (NSW), held invalid in that case, was that it mandated the "ex parte sequestration of property upon suspicion of wrong doing, for an indeterminate period, with no effective curial enforcement of the duty of full disclosure on ex parte applications."134 Release from such an order was conditioned upon "proof of a negative proposition of 133 (2009) 240 CLR 319; [2009] HCA 49. 134 (2009) 240 CLR 319 at 366 [97] per Gummow and Bell JJ. considerable legal and factual complexity."135 In that case orders made under the impugned provision had an immediate legal effect upon the absent and unknowing respondent's property rights. By way of contrast, a declaration that information is criminal intelligence does not have immediate legal operation although it has legal consequences for the use of that information in later substantive proceedings. In K-Generation Pty Ltd v Liquor Licensing Court136 this Court was concerned with s 28A of the Liquor Licensing Act 1997 (SA), which required the Licensing Court of South Australia to take steps to maintain the confidentiality of information which was criminal intelligence. The plurality noted that the Licensing Court137: could determine whether or not intelligence; information constituted criminal could itself question the evidence in closed session; could take into account evidence led by other parties and any limited form of cross-examination on relevant affidavits; could decide to place little weight on criminal intelligence having regard to the fact that the affected party had no opportunity to see it or test it. In the result, the plurality held that the section138: "did not operate to deny to the Licensing Court the constitutional character of an independent and impartial tribunal". There is nothing in the decision in K-Generation which requires a conclusion that the provisions of the COA relating to a criminal intelligence declaration have such an effect upon the Supreme Court of Queensland. For the preceding reasons questions (i) and (ii) in the Special Case should be answered in the negative. 135 (2009) 240 CLR 319 at 367 [97] per Gummow and Bell JJ. 136 (2009) 237 CLR 501; [2009] HCA 4. 137 (2009) 237 CLR 501 at 543 [148] per Gummow, Hayne, Heydon, Crennan and 138 (2009) 237 CLR 501 at 543 [149] per Gummow, Hayne, Heydon, Crennan and Closed ex parte hearings within a substantive application The respondents challenged provisions of the COA relating to the tender and use of criminal intelligence in substantive proceedings under the COA. It is in that respect that the COA most directly affects the mechanisms for the protection of procedural fairness and the application of the open court principle, that are the hallmarks of the judicial process. The issue is raised in questions (iii) and (v) in the Special Case, which principally concern ss 78 and 10 of the COA read together. Before considering the operation of s 78, it is necessary to refer to the statutory framework which the COA applies to all proceedings for applications to the Supreme Court under the Act and for appeals and reviews relating to any order under the COA. The effect of s 108 of the COA is that all proceedings under the COA are closed to members of the public including the media. To ensure that hearings under the COA are "closed" the Supreme Court is required to exclude all persons other than the Commissioner, the other party to the proceeding or, if it be an organisation or group of persons, the nominee of that organisation or group, the legal representatives of the Commissioner and the other party, the COPIM, any witness who is giving evidence and court staff139. The same restrictions apply to appeals to the Court of Appeal. Further, s 109 provides that access to a transcript of a hearing under the COA can only be gained upon application to the Commissioner140 on payment of the prescribed fee141. The Commissioner must grant an application under that section "as soon as practicable."142 No plausible explanation was offered, and none appears from the COA, for these remarkable constraints. They affect not just proceedings before judges of the Supreme Court hearing substantive applications under the COA, but also the Court of Appeal hearing appeals from the decisions of those judges. The validity of ss 108 and 109 was not in issue in these proceedings. However, s 108 is part of an overall statutory scheme of which the challenged provision, s 78, is part. The relationship between the two provisions appears from s 108(7), which provides: "This section does not apply to a closed hearing under section 70 or 78." That is to say, the more restrictive hearing regimes imposed by ss 70 and 78 will subsume the restrictions imposed by s 108. The effect of s 78 in this case would 139 COA, s 108(5). 140 COA, s 109(3) read with s 109(1). 141 COA, s 109(4). 142 COA, s 109(5). be to exclude the respondents and their legal representatives from any part of the pending application in which criminal intelligence is to be considered. The respondents submitted that the statutory denial to the Supreme Court of any discretion to balance the demands of secrecy with the respondents' legitimate interests to ensure that adverse evidence was properly tested, was repugnant to the judicial process. The absence of any such discretion was said to distinguish s 78 from the provision whose validity was upheld in K-Generation. The respondents further submitted that the role of the COPIM offered no substantive protection having regard to the prohibition against the COPIM making submissions in the presence of a respondent or the respondent's legal representative and the absence of any process for allowing the respondent or the respondent's legal representative to make representations to the COPIM. The applicant, in supporting the statutory procedures, set out a number of options open to the legislature in devising a process for dealing with criminal intelligence. One option would have allowed limited disclosure to one side of the record. Another, that which was adopted, provided for the use of material on the basis that there would be no disclosure at all to one side of the record. An option not considered in the applicant's submissions was to confer a discretion on the Supreme Court to determine whether limited disclosure to the legal representatives of one party was appropriate. The applicant correctly submitted that each of the options which it canvassed involved some prejudice to somebody. The applicant also correctly submitted that that consequence was not an invalidating attribute of the provisions of the COA relating to the use of criminal intelligence. That a law imposes a disadvantage on one party to proceedings in order to restrict, mitigate or avoid damage to legitimate competing interests does not mean that the defining characteristics of the court required to administer such a law are impermissibly impaired. Such a law was held valid in K-Generation143. The question of validity requires attention to the features of the statutory scheme taken as a whole. Factors tending to support validity in this case include: The making of the criminal organisation declaration involves the exercise of judicial power. The Supreme Court has a discretion to refuse to exercise its power to make a declaration even if satisfied of the matters which enliven that power. 143 (2009) 237 CLR 501 at 515 [22] per French CJ, 543 [148] per Gummow, Hayne, Heydon, Crennan and Kiefel JJ. The criteria of which the Supreme Court must be satisfied before making a declaration depend upon the Supreme Court's own assessment of the evidence before it. As the applicant accepted, the application for the declaration must set out all the grounds on which the declaration is sought and the information supporting those grounds. The grounds which must be disclosed include those which are based on criminal intelligence, albeit the application is not required to disclose the content of information relied upon which is the subject of a criminal intelligence declaration. The COA does not abrogate the power of the Supreme Court under r 161 of the UCPR or otherwise under the inherent power of the Supreme Court to order that the applicant provide particulars of its grounds for making the application. The COA does not prevent the Supreme Court from having regard to degrees of unfairness to the respondent in determining whether or not to accept criminal intelligence tendered in the course of the substantive hearing. The COPIM provides a limited measure of redress for the imbalance between the parties in respect of the use of criminal intelligence. The Supreme Court in a special closed hearing, during the hearing of a substantive application, may call witnesses and the COPIM may examine or cross-examine them144. The rules of evidence apply to the proceedings subject to the provisions of ss 107(2) and 61 of the COA, considered earlier in these reasons. Understandably the respondents placed great emphasis on the provision for special closed hearings and the secrecy attaching to criminal intelligence tendered to the Supreme Court. Those provisions undoubtedly represent incursions upon the open court principle and procedural fairness. The Supreme Court, however, retains its decisional independence and the powers necessary to mitigate the extent of the unfairness to the respondent in the circumstances of the particular case. It retains the responsibility to determine what weight, if any, to give to criminal intelligence and, in particular, hearsay evidence relating to information provided by informants. The power of the Supreme Court to control its own proceedings in order to avoid unfairness also suggests that it would have a discretion to refuse to act upon criminal intelligence where to do so would give rise to a degree of unfairness in the circumstances of 144 UCPR, r 391(1) and COA, s 89(2)(a)(ii). the particular case which could not have been contemplated at the time that the criminal intelligence declaration was made. Despite the incursions on the open court principle and the normal protections of procedural fairness effected by the impugned provisions of the COA, they do not so impair the essential or defining characteristics of the Supreme Court as a court as to be beyond the legislative power of the Queensland Parliament. The impugned provisions are valid. The answer to each of questions (iii) and (v) in the Special Case is "no". The anonymous informant—COA, s 76 The respondents submitted that s 76, read with a number of other provisions of the COA, established a regime in which evidence derived from informants could be used in an application for a criminal organisation declaration in circumstances where neither the Supreme Court nor the respondent to the application had a proper basis to evaluate that evidence or a proper opportunity to test it. The statutory scheme relating to the use of information derived from informants includes the following elements: in an application for a criminal intelligence declaration where information has been provided by an informant, the informant need not be identified in the application or supporting affidavits145; the informant cannot be called to give evidence or otherwise required to give evidence146; where information provided to a relevant agency by an informant is the subject of a criminal intelligence declaration, the Commissioner must file an affidavit sworn by an officer of the relevant agency setting out, inter alia, his or her honest and reasonable belief that the information provided is reliable and the reasons for that belief147. The officer is also required to provide information about the informant including the informant's criminal history without identifying the informant; 145 COA, s 63(5). 146 COA, s 64(2). 147 COA, s 64(3) and (4). the informant cannot be called or otherwise required to give evidence in substantive proceedings under the COA148; in any such substantive proceeding the Commissioner must file an affidavit by the officer of the relevant agency complying with the requirements of such affidavits in criminal intelligence declaration proceedings149. The provisions relating to information provided by informants place a respondent at a forensic disadvantage. However, the Supreme Court has the discretion to accept or reject or to give little weight to information provided by an informant. In so doing it may take account of unfairness flowing from the anonymity of the informant, the informant's unavailability for cross-examination and the hearsay character of evidence derived from the informant. The provisions relating to informant evidence do not impair the defining or essential characteristics of the Supreme Court. Question (iv) in the Special Case should be answered "no". The time for response—procedural unfairness? The respondents submitted that ss 9 and 106 of the COA are invalid to the extent that they prevent the Supreme Court extending the time for a respondent to file its response to an application under s 8. Section 9(3) requires the respondent to file a response to an application for a criminal organisation declaration at least five business days before the return date. Section 9(4) requires that the response be accompanied by any affidavit that the respondent intends to rely on at the hearing of the application. Section 106 provides that the applicant in a proceeding under the COA may apply to the Supreme Court for the extension of a return date currently applying to the application. The Supreme Court may grant such an application on the conditions which it considers appropriate150. The short answer to that submission is that the impugned provisions do not exclude the power of the Supreme Court to extend the times fixed under the COA for the filing of a response to an application for a declaration of an organisation. The answer to question (vii) in the Special Case is "no". 148 COA, s 76(2). 149 COA, s 76(3). 150 COA, s 106(3). Conclusion Questions (i) to (vii) in the Special Case should each be answered "no". The respondents should pay the costs of the Special Case. HAYNE, CRENNAN, KIEFEL AND BELL JJ. The issues The Special Case agreed by the parties to this proceeding asked whether certain provisions151 of the Criminal Organisation Act 2009 (Q) ("the CO Act") are invalid because they, or any of them, infringe Ch III of the Constitution. The Special Case is agreed in proceedings brought in the Supreme Court of Queensland, and removed in part into this Court, to declare the second respondent, the Finks Motorcycle Club, Gold Coast Chapter, a criminal organisation under the CO Act. The first respondent, Pompano Pty Ltd, is said to be part of that organisation. As developed in argument, the chief issue was whether s 10 of the CO Act, which permits the Supreme Court of Queensland on application by the Commissioner of the Queensland Police Service ("the Commissioner") to declare an organisation to be a "criminal organisation", is invalid because the procedures prescribed by the CO Act for the Supreme Court to decide whether to make a declaration impair the institutional integrity of that Court. The principal submission of the respondents, who alleged invalidity, was that the institutional integrity of the Supreme Court is impaired because the CO Act permits the Court to receive and act upon material which must not be disclosed to a respondent to an application for a declaration or to any representative of the respondent. The material that must be kept from the respondent to an application for a declaration is referred to in the CO Act as "criminal intelligence". Criminal intelligence is information that relates to actual or suspected criminal activity. Information of that kind must be kept from a respondent if the Supreme Court declares it to be criminal intelligence and that declaration cannot be made unless the Court is satisfied that disclosure of the information could reasonably be expected to prejudice a criminal investigation, enable the discovery of the existence or identity of a confidential source of information relevant to law enforcement or endanger a person's life or physical safety. The respondents raised two other issues but these were treated as subsidiary to the issue just described. The first was that the CO Act requires the Supreme Court to decide, in determining whether to declare an organisation to be a criminal organisation, whether that organisation is "an unacceptable risk to the 151 ss 9, 10 (and, in particular, s 10(1)(c)), 66, 70, 76 and 78. safety, welfare or order of the community"152 . Is that a question suitable for judicial determination? The second was that the CO Act gives a respondent to an application for a declaration that it is a criminal organisation little time to respond to that application. Does that require such a departure from judicial processes that it impairs the institutional integrity of the Supreme Court? The CO Act The CO Act provides153 that the Supreme Court of Queensland, on application by the Commissioner154, may declare an organisation155 to be a "criminal organisation" if the Court is satisfied that some of the organisation's members "associate for the purpose of engaging in, or conspiring to engage in, serious criminal activity" 156 and the organisation is "an unacceptable risk to the safety, welfare or order of the community" 157. In considering whether to make a declaration, the Court must158 have regard to various matters, including information before the Court "suggesting current or former members of the organisation have been, or are, involved in serious criminal activity, whether directly or indirectly and whether or not the involvement resulted in 152 s 10(1)(c). 155 Defined in the dictionary to the CO Act (Sched 2) as any incorporated or unincorporated group of three or more persons, however it is structured, whether based inside or outside the State or consisting of persons ordinarily resident inside or outside the State. 156 s 10(1)(b); see also s 10(4). 157 s 10(1)(c). 159 s 10(2)(a)(iii). If an organisation is declared to be a criminal organisation under the CO Act, the Supreme Court may, if certain conditions are met, make160 control orders for members of the organisation and persons who associate with members. Control orders may prohibit161 the person subject to the order from doing various things, including associating with members of any declared criminal organisation or with other controlled persons162 and applying for or undertaking stated employment163. That an organisation has been declared to be a criminal organisation is also relevant for the making of other orders under the CO Act164. Some attention was given in argument to what information the Commissioner must provide as part of an application for a declaration under s 10 of the CO Act. As argument developed it became apparent that there was little if any difference on this question between the parties. It is therefore not necessary to trace the development of this aspect of the argument; it is enough to state the relevant conclusions. The CO Act requires165 the application to state (among other things) the grounds on which the declaration is sought and the information supporting the grounds. The application must166 be accompanied by any affidavit the Commissioner intends to rely on at the hearing of the application. In combination, these provisions require the Commissioner to tell the respondent167 the whole of the case which the Commissioner seeks to make in support of the application for a declaration. That is, the Commissioner must identify, in detail, the information upon which the Commissioner will seek to rely to satisfy the Supreme Court of the three criteria for making a declaration which are identified in s 10(1): that the respondent is an organisation; that members of the 162 s 19(2)(a) and (b). 163 s 19(2)(h). 164 See ss 28 (public safety orders) and 43 (fortification removal orders). 165 s 8(2)(c) and (d). 167 See s 8(5)(c) (service of application and accompanying affidavits). organisation associate for the purpose of engaging in, or conspiring to engage in, serious criminal activity; and that the organisation is an unacceptable risk to the safety, welfare or order of the community. Section 10(2) provides that "[i]n considering whether or not to make a declaration, the court must have regard to" certain kinds of information before the Court as well as "anything else the court considers relevant". The specific matters identified in s 10(2) include not only such matters as any conviction of any current or former members of the organisation but also "information suggesting current or former members of the organisation have been, or are, involved in serious criminal activity, whether directly or indirectly and whether or not the involvement resulted in convictions"168. Again, if the Commissioner intends to rely on information of the kind just described, the initiating application and accompanying affidavits must give the respondent notice of that intention and particulars of the criminal activity that it is alleged has occurred or is occurring. The respondents' challenge to the validity of provisions of the CO Act must be determined on the basis of this construction of ss 8 and 10. On this construction, the Commissioner must give, in the application for a declaration that an organisation is a criminal organisation, and the affidavits accompanying the application, detailed particulars of what is alleged against the respondent organisation and how the Commissioner puts the case for making a declaration. The respondents directed much attention to those provisions of the CO Act which deal with "criminal intelligence". It is necessary to examine those provisions in some detail. Criminal intelligence The Commissioner may rely on169 "criminal intelligence" in support of an application for a declaration of an organisation as a criminal organisation. Section 59(1) of the CO Act provides that: "Criminal intelligence is information relating to actual or suspected criminal activity, whether in the State or elsewhere, the disclosure of which could reasonably be expected to— 168 s 10(2)(a)(iii). 169 See ss 60(a), 75 and 78. prejudice a criminal investigation; or enable the discovery of the existence or identity of a confidential source of information relevant to law enforcement; or endanger a person's life or physical safety." The elements of this definition require some elucidation. First, "criminal intelligence" is "information relating to actual or suspected criminal activity". The expression "criminal activity" is not defined in the Act. It should be read as requiring the identification of specific criminal offences. This construction follows naturally from the words of the definition and is reinforced by consideration of other provisions of the CO Act. "Serious criminal activity" is defined in s 6 as a "serious criminal offence" or an act done or omission made outside Queensland that, if done or made in Queensland, would have been or would be a serious criminal offence. "Serious criminal offence" is defined in s 7 as an indictable offence punishable by at least seven years' imprisonment or an offence against either the CO Act itself or certain specified provisions of the Criminal Code (Q). Second, the other element of the definition of "criminal intelligence" is that it must be information "the disclosure of which could reasonably be expected" to have one of three consequences: (a) prejudice to a criminal investigation (which should be read as referring only to a continuing criminal investigation); (b) enabling the discovery of the existence or identity of "a confidential source of law enforcement"; or (c) endangering a person's life or physical safety. It was not and could not be disputed that there is an evident public interest in the avoidance of all of these consequences. It was submitted by the respondents, however, that avoiding these consequences could not justify requiring a court to proceed to decide a case affecting the interests of a person on the basis of material which that person neither knows of nor has had a chance to answer. It will be necessary to return to that general proposition later in these reasons. information relevant The Commissioner may apply170 to the Supreme Court for a declaration that particular information is criminal intelligence. The Commissioner's criminal intelligence application must be decided171 before any substantive application in which it is to be relied on. The Court must172 consider the criminal intelligence application without notice of it having been given to any person other than the "criminal organisation public interest monitor" (or "COPIM") appointed under s 83(1) of the CO Act. If the Court declares the information to be criminal intelligence, and the information is relied on in support of an application to have an organisation declared a criminal organisation, the Court must173 "order any part of the hearing of the substantive application in which the declared criminal intelligence is to be considered ... to be a closed hearing" and must174 exclude from that part of the hearing everyone except the Commissioner, the Commissioner's legal representatives and nominees, a police officer, an officer from an agency from which the Commissioner obtained any of the declared criminal intelligence, the COPIM and the court staff necessary for the hearing. A deal of attention was given in argument to three questions about the operation of the criminal intelligence provisions of the CO Act. What role does the COPIM have? Can the respondent to an application to have it declared a criminal organisation apply for discharge or variation of any prior order declaring information to be criminal intelligence? Can the Supreme Court make any order which would give a representative of the respondent to an application to have it declared a criminal organisation access to declared criminal intelligence? Each is, of course, a question of very great importance to the application of the CO Act. It is not necessary, however, to answer any of them in dealing with the respondents' central complaint that the impugned provisions of the CO Act deny procedural fairness to a respondent to an application for a declaration that it is a criminal organisation. No party or intervener submitted that, in the hearing of a criminal intelligence application, the COPIM could or would stand in the shoes of any organisation which the Commissioner either had already applied, or may later apply, to have declared a criminal organisation. Nor was it submitted that the COPIM could or would stand in the shoes of any such organisation's representative. So, for example, it was not submitted that the COPIM could seek or obtain any instructions about the matters the subject of the criminal intelligence application. The CO Act provides no foundation for treating the COPIM's task as extending so far175. Even if it did, it must be recognised that no substantive application may have been instituted when application is made to declare information to be criminal intelligence. Accordingly, the class of persons interested in the uses to which declared criminal intelligence may be put in connection with a substantive application may be unknown and unknowable when a criminal intelligence application is made. No party or intervener submitted that any power the Supreme Court has to discharge or vary a criminal intelligence declaration could constitute more than a limited qualification to the general rule established by the CO Act that declared criminal intelligence must be kept secret from the respondent to an application for a substantive declaration. The qualification would be limited in the sense that the submissions appeared to contemplate the Supreme Court exercising a power to discharge or vary a criminal intelligence declaration only where the defining conditions in s 59(1) no longer exist. Finally, no argument was advanced or available176 for severing or reading down the CO Act to enable the Supreme Court to give representatives of a respondent organisation access to declared criminal intelligence. And even if, as the applicant submitted, the CO Act could be construed as not preventing the Supreme Court from exercising some discretionary power to direct that declared criminal intelligence be revealed to a representative of the respondent to an application for a declaration of that respondent as a criminal organisation, the validity of the impugned provisions must be determined on the footing that the provisions regulating the use of declared criminal intelligence may, and at least commonly will, be applied according to their terms. The basic principle underpinning the relevant provisions of the CO Act is that declared criminal intelligence is not to be revealed to the respondent or any representative of the respondent177. None of the three questions debated in argument about the operation of the criminal intelligence provisions must be answered in order to decide the validity of s 10. 175 See, for example, ss 86 (the COPIM's functions), 89 (appearance and role of the COPIM at hearing) and 90 (restrictions on legal practice during and after appointment as the COPIM). 176 See, for example, Wainohu v New South Wales (2011) 243 CLR 181 at 228 [102]; [2011] HCA 24. 177 See, for example, ss 60, 65, 66, 70, 77, 78, 82 and 90. The foundation of the case for invalidity There is a more fundamental reason why consideration of the arguments alleging invalidity does not call for these questions to be answered. The arguments that the CO Act's provisions dealing with criminal intelligence render s 10 invalid, though expressed in various ways, depended upon one central proposition: that Ch III of the Constitution puts beyond the legislative power of a State any enactment that would permit a State Supreme Court to decide a disputable issue by reference to evidence or information of which one party does not know and to which that party can have no access whether personally or by a representative. The proposition admitted of no exception. Although reference was made to the special procedures that have long been adopted by State and other courts in dealing with matters such as evidence of trade secrets and some kinds of evidence in cases concerning children, these procedures were treated as depending upon the courts' power (perhaps obligation) to permit access to the relevant material by at least the legal representatives of the parties. And inferentially if not explicitly, much of the argument appeared to proceed from the premise that cases of the kind described constitute a closed class of limited qualifications to an adversarial system to which no legislative addition could validly be made. That revelation of criminal intelligence could reasonably be expected to have consequences contrary to the public interest was treated as irrelevant to the issue of validity. The argument for invalidity asserted that in deciding any dispute a State Supreme Court must always follow an adversarial procedure by which parties (personally or by their representatives) know of all of the material on which the Court is being asked to make its decision. Otherwise, so it was asserted, there would be such a departure from procedural fairness that the institutional integrity of the Supreme Court would be impaired. Several observations must be made about this central proposition. First, it is absolute. Second, because it is absolute, it entrenches a particular form of adversarial procedure as a constitutionally required and defining characteristic of the State Supreme Courts. Third, as will be seen, it seeks to found this result not in any particular constitutional text but in what is said to be the logical consequence of earlier decisions of this Court. Examination of this central proposition, which underpinned the argument for invalidity, will demonstrate that it cannot be adopted. It is convenient to begin that examination by considering some earlier decisions of this Court and the principles which they applied. The applicable principles The argument for invalidity depended upon the application of principles first stated in Kable v Director of Public Prosecutions (NSW)178 and later considered and applied in several cases including, in particular, Fardon v Attorney-General (Qld)179, Gypsy Jokers Motorcycle Club Inc v Commissioner of Police180, K-Generation Pty Ltd v Liquor Licensing Court181, International Finance Trust Co Ltd v New South Wales Crime Commission182, South Australia v Totani183 and Wainohu v New South Wales184. The relevant principles have their roots in Ch III of the Constitution. As Gummow J explained185 in Fardon, the State courts (and the State Supreme Courts in particular) have a constitutionally mandated position in the Australian legal system. Once the notion is rejected, as it must be, that the Constitution "permits of different grades or qualities of justice"186, and it is accepted that the State courts have the constitutional position that has been described, it follows that "the Parliaments of the States [may] not legislate to confer powers on State courts which are repugnant to or incompatible with their exercise of the judicial power of the Commonwealth"187 (emphasis added). As Gummow J further 178 (1996) 189 CLR 51; [1996] HCA 24. 179 (2004) 223 CLR 575; [2004] HCA 46. 180 (2008) 234 CLR 532; [2008] HCA 4. 181 (2009) 237 CLR 501; [2009] HCA 4. 182 (2009) 240 CLR 319; [2009] HCA 49. 183 (2010) 242 CLR 1; [2010] HCA 39. 184 (2011) 243 CLR 181. 185 (2004) 223 CLR 575 at 617-619 [100]-[105]. 186 Kable (1996) 189 CLR 51 at 103 per Gaudron J. 187 Kable (1996) 189 CLR 51 at 103 per Gaudron J. pointed out188, and as is now the accepted doctrine of the Court189, "the essential notion is that of repugnancy to or incompatibility with that institutional integrity of the State courts which bespeaks their constitutionally mandated position in the Australian legal system". Three further points must be made about this "essential notion". First, "the critical notions of repugnancy and incompatibility are insusceptible of further definition in terms which necessarily dictate future outcomes"190. Second, the repugnancy doctrine "does not imply into the Constitutions of the States the separation of judicial power mandated for the Commonwealth by Ch III"191. Third, content must be given to the notion of institutional integrity of the State courts, and that too is a notion not readily susceptible of definition in terms which will dictate future outcomes. Something more must be said about the second and third points. Independence and impartiality are defining characteristics of all of the courts of the Australian judicial system192. They are notions that connote separation from the other branches of government, at least in the sense that the State courts must be and remain free from external influence193. In particular, the courts cannot be required to act at the dictation of the Executive194. In this respect, clear parallels 188 (2004) 223 CLR 575 at 617 [101]. 189 See, for example, Fardon (2004) 223 CLR 575 at 591 [15], 593 [23] per Gleeson CJ, 598-599 [37] per McHugh J, 648 [198] per Hayne J, 655-656 [219] per 190 Fardon (2004) 223 CLR 575 at 618 [104] per Gummow J. 191 Fardon (2004) 223 CLR 575 at 614 [86] per Gummow J. 192 See, for example, Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 343 [3], 363 [81]; [2000] HCA 63; North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 152-153 [3], 163 [29]; [2004] HCA 31; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 67-68 [41], 76 [64], 77 [66]; [2006] HCA 44; Gypsy Jokers (2008) 234 CLR 532 at 193 See, for example, Kable (1996) 189 CLR 51 at 98 per Toohey J, 119 per McHugh J, 133-134 per Gummow J; Bradley (2004) 218 CLR 146 at 163 [30]. 194 See, for example, Totani (2010) 242 CLR 1 at 52 [82], 67 [149], 92-93 [236], 160 can be drawn with some aspects of the doctrines that have developed in relation to federal courts. But because the separation of judicial power mandated by Ch III does not apply in terms to the States, and is not implied in the constitutions of the States, there can be no direct application to the State courts of all aspects of the doctrines that have been developed in relation to Ch III. More particularly, the notions of repugnancy to and incompatibility with the continued institutional integrity of the State courts are not to be treated as if they simply reflect what Ch III requires in relation to the exercise of the judicial power of the Commonwealth. to accommodate Two related consequences follow from these propositions and should be noted. First, in applying the notions of repugnancy and incompatibility it may well be necessary the accepted and constitutionally uncontroversial performance by the State courts of functions which go beyond those that can constitute an exercise of the judicial power of the Commonwealth. Second, the conclusions reached in this matter cannot be directly translated and applied to the exercise of the judicial power of the Commonwealth by a Ch III court. As pointed out by this Court in Bachrach (HA) Pty Ltd v Queensland195, the "occasion for the application of Kable does not arise" if the impugned State law would not offend Ch III had it been enacted by the Commonwealth Parliament for a Ch III court. But because "[n]ot everything by way of decision-making denied to a federal judge is denied to a judge of a State"196, that a State law does not infringe the principles associated with Kable does not conclude the question whether a like Commonwealth law for a Ch III court would be valid. It is not necessary for the resolution of this case to pursue those matters further. 195 (1998) 195 CLR 547 at 562 [14]; [1998] HCA 54. See also, for example, Silbert v Director of Public Prosecutions (WA) (2004) 217 CLR 181 at 186 [10]; [2004] HCA 9; Baker v The Queen (2004) 223 CLR 513 at 526-527 [22]-[24]; [2004] HCA 45. 196 Fardon (2004) 223 CLR 575 at 656 [219]. Some earlier decisions There are four instances where this Court has found State legislative provisions to be repugnant to or incompatible with the institutional integrity of State courts: Kable197, International Finance198, Totani199 and Wainohu200. Kable The Community Protection Act 1994 (NSW) empowered the Supreme Court of New South Wales to order the detention of a named person in prison for a specified period if satisfied on reasonable grounds that he was more likely than not to commit a serious act of violence and that it was appropriate for the protection of a particular person, or the community generally, that he be held in custody. A majority of this Court held201 the Act invalid. It is possible to discern several different strands in the reasoning in support of that conclusion but subsequent decisions of this Court demonstrate that, as already mentioned, the principle established in Kable is to be understood as founded on the notions of repugnancy to and incompatibility with institutional integrity. For present purposes it is important to recognise that the conclusion in Kable proceeded from consideration of the whole of the Act in question and all of the features which it presented. In Fardon, Gummow J described202 those features as including "the apparent legislative plan to conscript the Supreme Court of New South Wales to procure the imprisonment of the appellant by a process which departed in serious respects from the usual judicial process". In Kable, Gaudron J described203 the processes for which the Community Protection Act provided as not involving "the resolution of a dispute between contesting 197 (1996) 189 CLR 51. 198 (2009) 240 CLR 319. 199 (2010) 242 CLR 1. 200 (2011) 243 CLR 181. 201 (1996) 189 CLR 51 at 98-99 per Toohey J, 106-108 per Gaudron J, 124 per McHugh J, 144 per Gummow J. 202 (2004) 223 CLR 575 at 617 [100]. 203 (1996) 189 CLR 51 at 106. parties as to their respective legal rights and obligations" and as directing, in some circumstances, the Supreme Court to decide what order should be made under that Act "having regard to material which would not be admissible as evidence in legal proceedings". But neither of those features of the Community Protection Act can be considered separately from its other features and, in particular, its conscripting the Supreme Court to procure the imprisonment of a named person. International Finance A majority of the Court held s 10 of the Criminal Assets Recovery Act 1990 (NSW) ("the CAR Act") invalid. The CAR Act permitted a law enforcement authority to seek from the State Supreme Court, without notice to anyone, an order preventing any dealing with specified property. Section 10 provided that the Supreme Court must make that restraining order if a law enforcement officer suspected that the person who owned the property had committed any of a broad range of crimes, or the officer suspected that the property was derived from criminal activity, and the Court considered that there were reasonable grounds for the suspicion. The central point which divided the Court was whether, and to what the CAR Act prevented the Supreme Court from reviewing and extent, reconsidering an order made ex parte under that section for what, in effect, was the sequestration of property. The majority construed204 the Act as excluding that power and held that s 10 thus required the Supreme Court to make ex parte orders for the sequestration of property upon suspicion of wrongdoing, for an indeterminate period, with no effective curial enforcement of the duty of full disclosure on an ex parte application where the only possibility of release from the sequestration was upon proof of a complex negative proposition. Two members of the majority described205 s 10 as engaging "the Supreme Court in activity which is repugnant in a fundamental degree to the judicial process as understood and conducted throughout Australia". 204 (2009) 240 CLR 319 at 356 [58], [60] per French CJ, 364-367 [90]-[97] per Gummow and Bell JJ, 386 [160] per Heydon J. 205 (2009) 240 CLR 319 at 367 [98] per Gummow and Bell JJ; see also at 386-387 Totani The Serious and Organised Crime (Control) Act 2008 (SA) ("the SOC Act") stated its objects as including the disruption and restriction of the activities of organisations involved in serious crime. It provided for the State Attorney-General, on application by the Commissioner of Police, to make a declaration in relation to an organisation if satisfied that members of the organisation associated for the purpose of organising, planning, facilitating, supporting or engaging in serious criminal activity. Section 14(1) of the SOC Act provided that, on application by the Commissioner of Police, the Magistrates Court of South Australia must make a control order against a person if satisfied that the person is a member of a declared organisation. By majority, this Court held206 s 14(1) invalid because it authorised the Executive to enlist the Magistrates Court to implement the decisions of the Executive in a manner repugnant to or inconsistent with its continued institutional integrity. Whether and why an organisation should be declared was a matter for the Executive; the only question to be determined by the Magistrates Court was whether a person was a member of a declared organisation. As Crennan and Bell JJ put it207, the SOC Act, and s 14(1) in particular, had "the effect of rendering the [Magistrates] Court an instrument of the Executive". Wainohu The long title of the Crimes (Criminal Organisations Control) Act 2009 (NSW) ("the CCOC Act") said that it was enacted "to provide for the making of declarations and orders for the purpose of disrupting and restricting the activities of criminal organisations and their members". It provided for judges of the Supreme Court of New South Wales who gave their consent to be declared to be eligible judges for the purposes of Pt 2 of the CCOC Act. It empowered the Commissioner of Police to apply to an eligible judge for an order declaring an organisation to be a declared organisation for the purposes of the CCOC Act. A majority of this Court held208 the CCOC Act invalid because it exempted eligible judges from any duty to give reasons in connection with the 206 (2010) 242 CLR 1 at 52 [82] per French CJ, 67 [149] per Gummow J, 92-93 [236] per Hayne J, 160 [436] per Crennan and Bell JJ, 173 [481] per Kiefel J. 207 (2010) 242 CLR 1 at 160 [436]. 208 (2011) 243 CLR 181 at 219-220 [68]-[70] per French CJ and Kiefel J, 228 [104] per Gummow, Hayne, Crennan and Bell JJ. making or revocation of a declaration of an organisation as a declared organisation. It was this feature of the CCOC Act, rather than any more general question about whether the task performed by an eligible judge was performed as persona designata, or whether the task could be characterised as judicial or administrative, that was critical to the conclusion that the CCOC Act was repugnant to or incompatible with the continued institutional integrity of the Supreme Court. The submissions alleging invalidity Those alleging invalidity placed heavy emphasis on the cases that have just been discussed. Their arguments proceeded from the premise that proceedings for a declaration of an organisation as a criminal organisation "are not proceedings otherwise known to the law"209. While recognising that proceedings for a declaration of an organisation are not criminal, they submitted that "they form the basis of a process that is predominantly criminal in nature" because of the consequences that may follow from declaring an organisation to be a criminal organisation. They submitted that the ex parte processes required for determination of an application for a criminal intelligence declaration were not relevantly different from those examined in International Finance because the declaration would remain in force until revoked and could not effectively be challenged by the person or organisation to whom it related210. And they further submitted that, by denying the Supreme Court hearing an application to declare an organisation as a criminal organisation any discretion to balance the demands of secrecy about criminal intelligence with "the respondent's legitimate interest to ensure that any adverse evidence is properly tested", the CO Act compromises the Supreme Court's ability "to ensure, so far as practicable, fairness between the parties"211. As these submissions demonstrate, it is readily possible to take statements made in previous cases in explaining why the legislation under consideration in each was invalid and, by joining them together in a logical sequence, argue that the relevant provisions of the CO Act are invalid. But the constitutional validity of one law cannot be decided simply by taking what has been said in earlier decisions of the Court about the validity of other laws and assuming, without 209 cf Kable (1996) 189 CLR 51 at 106 per Gaudron J. 210 cf International Finance (2009) 240 CLR 319 at 354-355 [54]-[56] per French CJ, 364 [89] per Gummow and Bell JJ, 385 [155], 386 [159]-[160] per Heydon J. 211 International Finance (2009) 240 CLR 319 at 355 [55] per French CJ. examination, that what is said in the earlier decisions can be applied to the legislation now under consideration. The critical questions are whether and why what has been said can be applied. Judge Henry Friendly was surely right to warn212 against "the domino method of constitutional adjudication ... wherein every explanatory statement in a previous opinion is made the basis for extension to a wholly different situation". And as Judge Friendly pointed out more than once213, by reference to the writings of Judge Cardozo214, great care must be exercised in "pushing a principle to 'the limit of its logic'". Care must be exercised lest taking what has been said in explanation of the decisions in other cases about other legislation to its apparently logical end sever the applicable principle from its constitutional roots. Because the CO Act provides for the Supreme Court to follow novel procedures with respect to criminal intelligence, it is no doubt possible to say of them that they depart from hitherto established judicial processes. But the central question is whether the CO Act's provisions about the declaration and subsequent use of declared criminal intelligence are repugnant to or incompatible with the continued institutional integrity of the Supreme Court. The fact that the procedures prescribed by the Act are novel presents the question. Novelty does not, without more, supply the answer to that question. More detailed analysis is necessary. The case for invalidity Invalidity was said to follow from the requirement that the Supreme Court exclude the respondent organisation and its representatives from the hearing of a criminal intelligence application and from any parts of a hearing of a substantive application in which declared criminal intelligence is to be considered. The CO Act requires215 the Supreme Court to hear a criminal intelligence application in a "[s]pecial closed hearing" and further requires216 the Court to order any part 212 Friendly, "The Bill of Rights as a Code of Criminal Procedure", (1965) 53 California Law Review 929 at 950. 213 See, for example, Friendly, "The Bill of Rights as a Code of Criminal Procedure", (1965) 53 California Law Review 929 at 950; Friendly, "'Some Kind of Hearing'", (1975) 123 University of Pennsylvania Law Review 1267 at 1300-1301. 214 The Nature of the Judicial Process, (1921) at 51. of the hearing of a substantive application in which declared criminal intelligence is to be considered to be a closed hearing. The respondent organisation and its representatives are not permitted217 to attend closed hearings. This exclusion was said to constitute a radical departure from accepted judicial process and require denial of procedural fairness to the respondent. Before considering this submission it is necessary to notice what was not submitted and then to address, and reject, two points that were made in argument. First, those alleging invalidity did not submit that the CO Act enlists or conscripts the Supreme Court to do the Executive's bidding. That is, those the CO Act trenches upon the alleging independence of the Supreme Court. invalidity did not submit that Second, those alleging invalidity did not submit that it was beyond legislative power to require the Supreme Court to consider in private a criminal intelligence application or so much of a substantive application as concerned declared criminal intelligence. Invalidity of the relevant provisions of the CO Act was not said to follow from creation of these legislatively mandated exceptions to the general rule that the Supreme Court conduct open and public hearings. Third, subject to the questions presented by the operation of the criminal intelligence provisions, those alleging invalidity did not submit that an application for a declaration of an organisation as a criminal organisation would proceed in the Supreme Court in a manner differing in any relevant respect from what, in Re Nolan; Ex parte Young, Gaudron J rightly described218 as the general features of the judicial process: "open and public enquiry (subject to limited exceptions), the application of the rules of natural justice, the ascertainment of the facts as they are and as they bear on the right or liability in issue and the identification of the applicable law, followed by an application of that law to those facts". It was submitted, however, that requiring the Court to decide whether the respondent organisation is "an unacceptable risk to the safety, welfare or order of 217 ss 70(2) and 78(2). 218 (1991) 172 CLR 460 at 496; [1991] HCA 29. See also Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 359 [56] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [1999] HCA 9; Fardon (2004) 223 CLR 575 at 615 [92] per Gummow J. the community"219 presents a question that is not suitable for judicial determination. That submission should not be accepted. Its acceptance would be contrary to the decisions in Fardon220 and Thomas v Mowbray221 and the reasoning that underpinned them. To determine whether a disfavoured status should be accorded to an organisation based on an assessment of what its members have done, are suspected of having done, and may do in the future is not different in any relevant way from the tasks held to be validly assigned to courts by the legislation in issue in those cases. Courts are often called on to make predictions about dangers to the public222. One other consideration should be examined but may then be put aside. The respondents submitted that the criminal intelligence provisions expand "the nature of the evidence beyond what would ordinarily be admissible". That submission should not be accepted. The criminal intelligence provisions of the CO Act do not provide for the reception in evidence of information that would otherwise be irrelevant or inadmissible. They provide for conditions which permit the tendering of evidence which would not otherwise have been adduced. This point requires some explanation. Section 60 of the CO Act records that the objects of Pt 6 (which deals with criminal intelligence) include allowing "evidence that is or contains criminal intelligence to be admitted in applications under this Act without the evidence" having the consequences stated in the definition223 of "criminal intelligence": prejudicing a criminal investigation, enabling the discovery of the existence or identity of a confidential source of information relevant to law enforcement or endangering anyone's life or physical safety. The criminal intelligence provisions of the CO Act assume that, but for their enactment, information which could be declared criminal intelligence would not be available for use by the 219 s 10(1)(c). 220 (2004) 223 CLR 575 at 593 [22] per Gleeson CJ, 605-606 [60], 619 [108] per Gummow J, 657-658 [225]-[228] per Callinan and Heydon JJ. 221 (2007) 233 CLR 307 at 327-329 [15]-[16], 334 [28] per Gleeson CJ, 355 [109]-[110] per Gummow and Crennan JJ, 507-508 [595]-[596] per Callinan J; [2007] HCA 33. 222 Thomas v Mowbray (2007) 233 CLR 307 at 334 [28]. Supreme Court in deciding whether to declare an organisation to be a criminal organisation. Why is that assumption made? That members of a respondent organisation have engaged in, or are suspected of having engaged in, criminal activity is relevant224 to whether an organisation should be declared to be a criminal organisation and evidence of those matters could be tendered in admissible form. The assumption must accordingly be understood as made on the basis that, but for the criminal intelligence provisions of the CO Act, an applicant for a declaration of an organisation as a criminal organisation would not advance the material in evidence when doing so could reasonably be expected to have one of the adverse consequences referred to in the definition of criminal intelligence. As noted earlier, the avoidance of each of those consequences is in the public interest. If, in litigation not governed by the CO Act, a party sought to adduce evidence of information that would meet the definition of criminal intelligence, the Commissioner may very well be able to resist its production on public interest immunity grounds. In determining that claim, the court could examine225 documents not shown to one party for the purpose of ruling on that claim. And if that objection were to be upheld, the material could not be received in evidence226. But in a case of the kind just described, it would be the Commissioner who would seek to keep the information secret. The CO Act seeks to permit the Commissioner to use it. It does that by providing for the reception of evidence of information which is relevant to the issue and which, but for those provisions, would not be advanced only because of the adverse consequences that could reasonably be expected to follow from its tender. The criminal intelligence provisions do not provide for the reception of evidence that would otherwise be irrelevant or inadmissible. They provide for the admission of evidence which would otherwise not be adduced. 224 See s 10(2)(a)(iii) in relation to "serious criminal activity". 225 Sankey v Whitlam (1978) 142 CLR 1 at 46; [1978] HCA 43; Alister v The Queen (1984) 154 CLR 404; [1984] HCA 85. 226 The Commonwealth v Northern Land Council (1993) 176 CLR 604; [1993] HCA 24. Gypsy Jokers and K-Generation It is convenient to begin consideration of the submissions about procedural fairness by reference to this Court's decisions in Gypsy Jokers and K-Generation, in each of which (unlike the cases discussed earlier) at least a majority of the Court upheld the legislation in question. In Gypsy Jokers, the Court considered the validity of s 76(2) of the Corruption and Crime Commission Act 2003 (WA) ("the CCC Act"). Under the CCC Act, the Commissioner of Police could issue a "fortification removal notice" if the Commissioner reasonably believed that premises were heavily fortified and habitually used as a place of resort by members of a class a significant number of whom might reasonably be suspected to be involved in organised crime. A person to whom a notice of that kind was directed could apply to the Supreme Court of Western Australia for review of the notice. Section 76(2) of the CCC Act restricted the information available to an applicant for review by providing that the Commissioner could identify information provided to the Supreme Court as confidential "if its disclosure might prejudice the operations of the Commissioner". Information of that kind would then be for the Court's use only. The validity of s 76(2) was challenged primarily on the ground that it imposed an impermissible legislative direction and form of executive control over the exercise by the Supreme Court of its jurisdiction. The challenge failed. A majority of the Court held227 that, on its proper construction, s 76(2) required the Supreme Court to decide for itself whether the disclosure of the information alleged to be confidential would prejudice the operations of the Commissioner. The appellant in Gypsy Jokers also submitted that, by allowing only the Court to have access to information which was found to be properly claimed as confidential, s 76(2) was beyond power because it was repugnant to or inconsistent with the continued institutional integrity of the Court. Crennan J (with whom Gleeson CJ agreed) explicitly rejected228 this submission. The plurality said229 of the provision only that it had "an outcome comparable with 227 (2008) 234 CLR 532 at 551-552 [7] per Gleeson CJ, 558 [30], [33], 561 [44] per Gummow, Hayne, Heydon and Kiefel JJ, 593-594 [170]-[174] per Crennan J. 228 (2008) 234 CLR 532 at 596 [183], 597 [191]. 229 (2008) 234 CLR 532 at 559 [36] per Gummow, Hayne, Heydon and Kiefel JJ; see also at 550-551 [5] per Gleeson CJ. that of the common law respecting public interest immunity, but with the difference that the Court itself may make use of the information in question". The plurality said nothing to indicate that s 76(2), by allowing only the Court to have access to the confidential information, might, on that account, be of doubtful validity. Rather, the plurality's conclusion in Gypsy Jokers proceeded from an acceptance that, as Crennan J rightly pointed out230, "Parliament can validly legislate to exclude or modify the rules of procedural fairness". The decision in Gypsy Jokers points firmly against accepting the central proposition advanced by those advocating invalidity of the CO Act. But lest it be said that the point was not dealt with expressly by a majority of the Court in Gypsy Jokers, it is as well to explore the issue further. In K-Generation, this Court unanimously upheld the validity of s 28A of the Liquor Licensing Act 1997 (SA). That provision required, on application by the Commissioner of Police, the Liquor and Gambling Commissioner, the Licensing Court of South Australia and the Supreme Court of South Australia to take steps to maintain the confidentiality of information classified by the Commissioner as criminal intelligence. The Court held231 that s 28A was not repugnant to or incompatible with the continued institutional integrity of the relevant South Australian State courts because the courts could determine for themselves both whether the information met the definition of criminal intelligence in the Liquor Licensing Act and what steps to take to maintain the confidentiality of the information. The respondents submitted in this case that K-Generation can be distinguished because the CO Act prohibits the Supreme Court from giving a respondent (or a respondent's representative) access to criminal intelligence whereas the Liquor Licensing Act allowed the courts to decide what steps should be taken to maintain confidentiality. Even assuming that to be so (and as noted earlier, it is unnecessary to decide whether the Supreme Court could order that a respondent's representative have access to criminal intelligence), the relevant 230 (2008) 234 CLR 532 at 595-596 [182], citing The Commissioner of Police v Tanos (1958) 98 CLR 383 at 396 per Dixon CJ and Webb J (Taylor J agreeing); [1958] HCA 6; Annetts v McCann (1990) 170 CLR 596 at 598 per Mason CJ, Deane and McHugh JJ; [1990] HCA 57; and Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 56 [24] per Gleeson CJ; [2005] HCA 50. 231 (2009) 237 CLR 501 at 531-532 [94]-[99] per French CJ, 542-543 [144]-[149] per Gummow, Hayne, Heydon, Crennan and Kiefel JJ, 576-580 [257] per Kirby J. provisions of the CO Act are not invalid by reason only of this difference. No member of the Court in K-Generation said that the State courts' ability to decide what steps to take to maintain confidentiality was necessary to validity. In K-Generation, the Court paid close attention to all of the relevant features of the Liquor Licensing Act, and a similarly close examination of the CO Act is required in this case. Procedural fairness and the judicial process The rules of procedural fairness do not have immutably fixed content. As Gleeson CJ rightly observed232 in the context of administrative decision-making but in terms which have more general and immediate application, "[f]airness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice." To observe that procedural fairness is an essential attribute of a court's procedures is descriptively accurate but application of the observation requires close analysis of all aspects of those procedures and the legislation and rules governing them233. Consideration of other judicial systems may be taken to demonstrate that it cannot be assumed that an adversarial system of adjudication is the only fair means of resolving disputes. But if an adversarial system is followed, that system assumes, as a general rule, that opposing parties will know what case an opposite party seeks to make and how that party seeks to make it. As the trade secrets cases show, however, the general rule is not absolute. There are circumstances in which competing interests compel some qualification to its application. And, if legislation provides for novel procedures which depart from the general rule described, the question is whether, taken as a whole, the court's procedures for resolving the dispute accord both parties procedural fairness and avoid "practical injustice". As noted at the outset of these reasons, the CO Act requires234 the Commissioner to give, as part of the application for a declaration of an organisation as a criminal organisation, detailed particulars of both the grounds 232 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 14 [37]; [2003] HCA 6. 233 See, for example, RCB (as litigation guardian of EKV, CEV, CIV and LRV) v The Honourable Justice Forrest (2012) 87 ALJR 1; 292 ALR 617; [2012] HCA 47. for making the declaration and the information supporting those grounds. The operation of the criminal intelligence provisions will prevent a respondent and the respondent's representatives knowing of one class of material that the Commissioner alleges supports the case for a declaration. In this respect the CO Act may be said to require departure from the usual incidents of an adversarial system of adjudication, but the nature and extent of that departure must be identified with some care. The procedural unfairness which it was said was worked by the criminal intelligence provisions of the CO Act was identified as being the denial to the respondent of any opportunity to test the criminal intelligence. But three points must then be made. First, if it is unfair to keep criminal intelligence from the respondent because the respondent cannot test its truth or reliability, it is not apparent how that unfairness could be cured by telling the respondent's lawyer that the applicant intends to rely on identified criminal intelligence. Yet argument of the present matter assumed that procedural fairness would be accorded if a lawyer representing a respondent organisation could be told what was the criminal intelligence upon which the applicant for a declaration relied. If told of the content of criminal intelligence to be proved in support of an application for a declaration of an organisation as a criminal organisation, what could the respondent's lawyer do with that knowledge? The criminal intelligence is235 information relating to actual or suspected criminal activity. The lawyer could not seek or obtain instructions from anyone about the factual assertions made in that criminal intelligence. The lawyer could not, without disclosing the existence or content of the information constituting the criminal intelligence, ask any member of the respondent to comment on what the lawyer had been told. The lawyer could assemble no ammunition to launch an attack upon the veracity of a confidential source alleged to have provided criminal intelligence without disclosing that source's existence236. Unlike the commonplace case of evidence of a secret process or other confidential commercial information, the lawyer could not look to some independent third party expert to provide in confidence the means of testing the evidence. 236 The CO Act also makes special provision for, and additional restrictions upon disclosure concerning, informants as defined in the dictionary to the Act (Sched 2): see, for example, ss 63(5), 64 and 76. Second, s 72(2) of the CO Act expressly permits the Supreme Court, in exercising its discretion to declare information to be criminal intelligence, to have regard to whether the considerations of prejudice to criminal investigations, enabling discovery of the existence or identity of an informer or danger to anyone's life or physical safety "outweigh any unfairness to a respondent". No doubt it must be recognised that this discretion falls to be exercised before information is relied on for a substantive application237, and thus must be exercised when all who may be affected by the information may not be identified or identifiable. But fairness to a respondent is a matter to which the Supreme Court may have regard in deciding whether to declare information to be criminal intelligence. In many cases, including those where the respondent to a substantive application is known or can be ascertained, it is a matter to which the Court would be bound to have regard. The third point to be made is that the criminal intelligence provisions deny a respondent knowledge of how the Commissioner seeks to prove an allegation; they do not deny the respondent knowledge of what is the allegation that is made against it. As has already been shown, a respondent to an application for a declaration of an organisation as a criminal organisation, its representatives and those who are alleged to be its members will know from the application the case that the Commissioner seeks to make. If, as must always be the case, the Commissioner alleges that the organisation should be declared to be a criminal organisation because some or all of its members associate for the purpose of engaging in, or conspiring to engage in, serious criminal activity, the Commissioner will have had to provide particulars of the activity upon which the Commissioner relies, of those who are alleged to have engaged in that activity and of whether those persons are alleged to be or to have been members of the organisation. For all practical purposes, demonstration of association for the purposes described would be possible only if persons alleged to have then been members of the organisation were alleged to have engaged in relevant acts or omissions constituting serious criminal activity before the application for declaration of the organisation was made. Thus the Commissioner must allege and prove not only the occurrence of past serious criminal activity by persons who then were members of the organisation but also that members of the organisation associate for one or more of the identified purposes relating to that activity. The criminal activity upon which the Commissioner relies could be demonstrated by proof of the previous prosecution and conviction of members for conduct constituting activity of the kind alleged. To the extent that it is, the respondent can dispute the conclusions which the Commissioner seeks to draw from those facts. (The respondent could also seek to dispute the fact that convictions were recorded but that possibility can be dismissed from consideration as unlikely to be practically relevant.) And to the extent that prior criminal activity is not established by proving the prior convictions of persons shown to have been members of the organisation at relevant times, the respondent, its members and its representatives would know that the case to be met is founded on assertions and allegations not yet made and established in a court. In deciding any application for declaration of an organisation as a criminal organisation, the Supreme Court would know that evidence of those assertions and allegations that constituted criminal intelligence had not been and could not be challenged directly. The Court would know that the respondent and its members could go no further than make general denials of any wrongdoing of the kind alleged. What weight to give to that evidence would be a matter for the Court to judge238. Contrary to a proposition which ran throughout the respondents' submissions in this case, noticing that the Supreme Court must take account of the fact that a respondent cannot controvert criminal intelligence does not seek to deny the allegation of legislative invalidity by asserting that the Supreme Court can be "relied on" to remedy any constitutional infirmity or deficiency in the legislative scheme. Rather, it points to the fact that under the impugned provisions the Supreme Court retains its capacity to act fairly and impartially. Retention of the Court's capacity to act fairly and impartially is critical to its continued institutional integrity. In this respect, it is useful to contrast the impugned provisions of the CO Act with the CCOC Act considered in Wainohu. It will be recalled that the CCOC Act provided that an eligible judge need not give reasons for declaring an organisation to be a declared organisation. That an eligible judge could choose to do so was not to the point239. The CCOC Act was held invalid as repugnant to 238 See K-Generation (2009) 237 CLR 501 at 543 [148]. 239 (2011) 243 CLR 181 at 220 [69] per French CJ and Kiefel J, 228 [103] per Gummow, Hayne, Crennan and Bell JJ. or inconsistent with the institutional integrity of the Supreme Court of New South Wales. But in the present case, the CO Act does not in any way alter the duty of the Supreme Court to assess the cogency and veracity of the evidence that is tendered in an application for a declaration of an organisation as a criminal organisation. When it is said, as it was in this case, that there has been a departure from hitherto accepted forms of procedure and thus a departure from accepted judicial process, the significance of providing for some novel procedure must be measured against some standard or criterion. Consideration of the continued institutional integrity of the State courts directs attention to questions of independence, impartiality and fairness. In cases where it is said that the courts have been conscripted to do the Executive's bidding, the principal focus will likely fall upon questions of independence and impartiality. But that is not and was not said to be this case. Where, as here, a novel procedure is said to deny procedural fairness, attention must be directed to questions of fairness and impartiality. Observing that the Supreme Court can and will be expected to act fairly and impartially points firmly against invalidity. the Contrary the decision of the respondents' submissions, Supreme Court of the United Kingdom in Al Rawi v Security Service240 does not assist in resolving the constitutional issues at stake in this case. A majority of the Supreme Court held in that case that there is no inherent power for a court, in either a civil or criminal trial, to allow a procedure whereby one party and the court may rely upon material that cannot be disclosed to the other party or its legal representatives. The validity of that proposition need not be examined here. It is a proposition which does not bear at all upon the radically different question of the ambit of legislative power that is in issue here. That ambit is fixed in this case by the principles that have been discussed earlier in these reasons. Sections 9 and 106 The second of the subsidiary arguments advanced against validity remains for consideration: that ss 9 and 106 of the CO Act are invalid to the extent to which they prevent the Supreme Court from extending the time for a respondent to file its response to an application for a declaration that it is a criminal organisation. The application must state241 as the return date for the application a day within 35 days of its filing. Section 9(3) provides that the respondent must 241 s 8(5)(b). file its response to an application at least five business days before the return date of the application. The response must be accompanied by any affidavit the respondent intends to rely on at the hearing242. Section 106(1) provides that the applicant may apply to the Supreme Court for an extension of the "return date currently applying to the application". The CO Act makes no express provision for the respondent to make any application for an extension of either the return date or the time fixed by s 9(3) for its filing a response and any affidavit on which it will seek to rely at the hearing. Those supporting the validity of the relevant provisions submitted that they should not be construed as excluding the power of the Supreme Court to extend the times fixed under the CO Act as the times by which the respondent to an application for a declaration of an organisation must file its response or file affidavits on which it would seek to rely at the hearing. Those who challenged the validity of the provisions did not seek in the end to challenge those submissions. Given the well-established principle243 that the CO Act should be read as taking the Supreme Court "as it finds it", neither s 9 nor s 106 should be read as disclosing a clear intention to prevent the Supreme Court from acting upon either a response filed later than the time fixed by the CO Act or an affidavit filed after a response was, or should have been, filed. The challenge to the validity of these provisions should be rejected. Conclusion and orders For these reasons, the impugned provisions of the CO Act are not repugnant to or inconsistent with the institutional integrity of the Supreme Court. The questions reserved for consideration should be answered accordingly. The respondents should pay the costs of the Special Case. 243 Electric Light and Power Supply Corporation Ltd v Electricity Commission of NSW (1956) 94 CLR 554 at 560; [1956] HCA 22. Introduction French CJ has explained the provisions of the Criminal Organisation Act 2009 (Q) ("the COA"). He has set out the questions reserved by the parties for the consideration of the Full Court. I agree with French CJ, for the reasons he gives, that s 9 of the COA is not invalid because it limits time to respond to an application under s 8 of the COA. I also agree with French CJ, for the reasons he gives, that s 10(1)(c) of the COA is not invalid because of the nature of the judgment it requires the Supreme Court of Queensland to make. The other questions turn on the compatibility of "criminal intelligence" provisions of the COA with constitutionally mandated characteristics of the Supreme Court of Queensland. I agree with the answers of French CJ but propose to state my own view of what is required to achieve that compatibility. My view, in short, is that Ch III of the Constitution mandates the observance of procedural fairness as an immutable characteristic of a Supreme Court and of every other court in Australia. Procedural fairness has a variable content but admits of no exceptions. A court cannot be required by statute to adopt a procedure that is unfair. A procedure is unfair if it has the capacity to result in the court making an order that finally alters or determines a right or legally protected interest of a person without affording that person a fair opportunity to respond to evidence on which that order might be made. intelligence provisions are not rendered compatible with The criminal intelligence provisions of the COA have the potential to result – in some but not all cases – in the Supreme Court of Queensland making a declaration of a criminal organisation or a control order or other order without the organisation or individual affected being afforded a fair opportunity to respond to evidence on which the declaration or order might be made. The criminal the constitutional requirement for procedural fairness by the presence of the criminal organisation public interest monitor ("the COPIM"), nor by the ability of the Supreme Court of Queensland to determine the weight to be given to declared criminal intelligence, nor by the width of the discretion allowed to the Supreme Court of Queensland in making a declaration of a criminal organisation or a control order or other order under the COA. The criminal intelligence provisions are saved from incompatibility with Ch III of the Constitution only by the capacity for the Supreme Court of Queensland to stay a substantive application in the exercise of inherent jurisdiction in a case where practical unfairness becomes manifest. What follows is an elaboration of that view. Chapter III and procedural fairness The structural separation of the judicial power of the Commonwealth by Ch III of the Constitution is "the bulwark of the [C]onstitution against encroachment whether by the legislature or by the executive" 244 and "the Constitution's only general guarantee of due process"245. Chapter III has the result that "[t]he guilt of the citizen of a criminal offence and the liability of the citizen under the law, either to a fellow citizen or to the State, can be conclusively determined only by a Ch III court acting as such, that is to say, acting judicially"246. Yet Ch III of the Constitution also adopts an "autochthonous expedient"247: it allows the separated judicial power of the Commonwealth to be vested in courts other than those created by the Commonwealth Parliament. All State and Territory courts are able to be vested by the Commonwealth Parliament with the judicial power of the Commonwealth. They are all "Ch III courts". That structural expedient can function only if State and Territory courts are able to act "judicially". To be able to act judicially, a court must have institutional integrity: it must "be and appear to be an independent and impartial tribunal"248. There lies the essentially structural and functional foundation for the implication that has come to be associated with Kable v Director of Public Prosecutions (NSW)249. The implication is a practical, if not logical, necessity250. To render State and Territory courts able to be vested with the separated judicial power of the Commonwealth, Ch III of the Constitution preserves the 244 Attorney-General of the Commonwealth of Australia v The Queen (1957) 95 CLR 529 at 540; [1957] AC 288 at 315. 245 Re Tracey; Ex parte Ryan (1989) 166 CLR 518 at 580; [1989] HCA 12. 246 Re Tracey; Ex parte Ryan (1989) 166 CLR 518 at 580. 247 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268; [1956] HCA 10. 248 Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 81 [78]; [2006] HCA 44; North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 163 [29]; [2004] HCA 31. 249 (1996) 189 CLR 51; [1996] HCA 24. 250 McGinty v Western Australia (1996) 186 CLR 140 at 168-169; [1996] HCA 48. institutional integrity of State and Territory courts. A State or Territory law that undermines the actuality or appearance of a State or Territory court as an independent and impartial tribunal is incompatible with Ch III because it undermines the constitutionally permissible investiture in that court of the separated judicial power of the Commonwealth. The plurality in Leeth v The Commonwealth251 anticipated the Kable implication in saying that "[i]t may well be that any attempt on the part of the legislature to cause a court to act in a manner contrary to natural justice would impose a non-judicial requirement inconsistent with the exercise of judicial power"252. The plurality added that "the rules of natural justice are essentially functional or procedural" and that "a fundamental principle which lies behind the concept of natural justice is not remote from the principle which inspires the theory of separation of powers"253. "It is", of course, "a fundamental principle of natural justice, applicable to all courts whether superior or inferior, that a person against whom a claim or charge is made must be given a reasonable opportunity of appearing and presenting his case."254 Two members of the majority in Kable specifically held that a function cannot be conferred on a court compatibly with Ch III if that function is "antithe[tical]" or "repugnant" to the "judicial process"255, explained in Bass v Permanent Trustee Co Ltd256 to require "that the parties be given an opportunity to present their evidence and to challenge the evidence led against them"257. That holding was subsequently applied by all members of the majority in International Finance Trust Co Ltd v New South Wales Crime Commission258. Justifications for procedural fairness are both instrumental and intrinsic. To deny a court the ability to act fairly is not only to risk unsound conclusions 251 (1992) 174 CLR 455; [1992] HCA 29. 252 (1992) 174 CLR 455 at 470. 253 (1992) 174 CLR 455 at 470. 254 Cameron v Cole (1944) 68 CLR 571 at 589; [1944] HCA 5. 255 (1996) 189 CLR 51 at 106, 134. 256 (1999) 198 CLR 334; [1999] HCA 9. 257 (1999) 198 CLR 334 at 359 [56]. 258 (2009) 240 CLR 319 at 352 [50], 354 [54], 363-364 [88], 367 [98], 379 [140], 386- 387 [161]; [2009] HCA 49. and to generate justified feelings of resentment in those to whom fairness is denied259. The effects go further. Unfairness in the procedure of a court saps confidence in the judicial process and undermines the integrity of the court as an institution that exists for the administration of justice260. The centrality of procedural fairness to institutional integrity is implicit in the description of the inherent jurisdiction of a superior court to stay proceedings on grounds of abuse of process as involving261: "the inherent power which any court of justice must possess to prevent misuse of its procedure in a way which, although not inconsistent with the literal application of its procedural rules, would nevertheless be manifestly unfair to a party to litigation before it, or would otherwise bring the administration of justice into disrepute among right-thinking people". It is also implicit in the explanation that the inherent jurisdiction262: "extends to all those categories of cases in which the processes and procedures of the court, which exist to administer justice with fairness and impartiality, may be converted into instruments of injustice or unfairness". While the characteristics of a court as an independent and impartial tribunal defy exhaustive definition, there is no novelty in the proposition that those characteristics include that the court not be required by statute to adopt a procedure that is unfair263. Procedural fairness requires the avoidance of "practical injustice"264. It requires, at the very least, the adoption of procedures that ensure to a person whose right or legally protected interest may finally be altered or determined by a court order a fair opportunity to respond to evidence on which that order might be based. 259 International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 380-381 [143]-[144]. 260 Re JRL; Ex parte CJL (1986) 161 CLR 342 at 351-352, 364, 369-370; [1986] HCA 39. 261 Walton v Gardiner (1993) 177 CLR 378 at 393; [1993] HCA 77, quoting Hunter v Chief Constable of the West Midlands Police [1982] AC 529 at 536. 262 Walton v Gardiner (1993) 177 CLR 378 at 393. 263 Nicholas v The Queen (1998) 193 CLR 173 at 208-209 [74]; [1998] HCA 9. 264 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 14 [37]; [2003] HCA 6. Does the proposition that a court cannot be required by statute to adopt a procedure that is unfair admit of exceptions? No authority compels the conclusion that it does. In Gypsy Jokers Motorcycle Club Inc v Commissioner of Police265, Crennan J (with whom Gleeson CJ agreed) stated that "Parliament can validly legislate to exclude or modify the rules of procedural fairness provided there is 'sufficient indication' that 'they are excluded by plain words of necessary intendment'"266. The joint majority judgment did not go that far267. The statement of Crennan J is to be read in a context in which her Honour went on to find in the statute in question "modification", not exclusion268. The statement was made with reference to The Commissioner of Police v Tanos269 and Annetts v McCann270. In neither case was a constitutional issue raised. What in Tanos was described as the "deep-rooted principle of the law that before any one can be punished or prejudiced in his person or property by any judicial or quasi-judicial proceeding he must be afforded an adequate opportunity of being heard" was said to be applicable "to proceedings in the established courts [as] a matter of course". The principle was held not to be displaced by the statute in question271. Annetts v McCann did not concern a court, but a coronial inquiry272. In K-Generation Pty Ltd v Liquor Licensing Court273 the statute in question relevantly required no more than that a State court "take steps to maintain information classified … as criminal intelligence"274. The plurality stressed the range of procedures that remained the confidentiality of 265 (2008) 234 CLR 532; [2008] HCA 4. 266 (2008) 234 CLR 532 at 595-596 [182] (citations omitted). 267 (2008) 234 CLR 532 at 559 [35]-[36]. 268 (2008) 234 CLR 532 at 596 [183]; see generally at 595-597 [181]-[189]. 269 (1958) 98 CLR 383 at 396; [1958] HCA 6. 270 (1990) 170 CLR 596 at 598; [1990] HCA 57. 271 (1958) 98 CLR 383 at 395-396. 272 See Ammann v Wegener (1972) 129 CLR 415 at 436; [1972] HCA 58. 273 (2009) 237 CLR 501; [2009] HCA 4. 274 Section 28A(5) of the Liquor Licensing Act 1997 (SA), quoted in K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501 at 541 [139]. available to provide procedural fairness275. Similar flexibility in the provision of procedural fairness was allowed by the "criminal intelligence" provisions in respect of which no constitutional difficulty was identified in Wainohu v New South Wales276. The Court did not in that case strain at the constitutional gnat of a statutory permission for a court not to give reasons only to swallow the constitutional camel of a statutory requirement for a court not to give procedural fairness. Suggestions that there are exceptions to procedural fairness in the common practices of courts in Australia are unfounded. The suggested exceptions are more apparent than real. There are many instances in which a court may, or must, make ex parte orders; but invariably as a step in an overall process that, viewed in its entirety, entails procedural fairness. International Finance shows that a court cannot validly be required to make an ex parte restraining order within a statutory context which practically impedes the affected person from applying for discharge of that order277. There are then cases, of which claims for the protection of some intellectual property or for the determination of client legal privilege or public interest immunity are examples, where the usual practices of courts are adjusted to protect confidentiality at the heart of a right or interest in issue which would be destroyed were confidential information to be disclosed in the curial process. There are also instances in which specific evidence given to a court is withheld from a party to protect commercial confidentiality, to protect the safety of a witness or an informant, or for some other reason sufficiently supported by the interests of justice. All are examples of modifications or adjustments to ordinary procedures, invariably within an overall process that, viewed in its entirety, entails procedural fairness. They are not, as submitted on behalf of the Attorney-General for New South Wales, examples of the content of procedural fairness in a court being reduced to "nothingness"278. Practices of courts in the United Kingdom and Canada, to which the parties and some interveners referred, point in no different direction. The Supreme Courts of those countries have in recent years been called on to consider the compatibility of various forms of novel court procedures with constitutional or quasi-constitutional norms requiring that the determination of rights and obligations occur in a fair and public hearing before an independent 275 (2009) 237 CLR 501 at 542-543 [145]-[147]. 276 (2011) 243 CLR 181 at 193-194 [11]; [2011] HCA 24. 277 (2009) 240 CLR 319 at 356 [58], 366-367 [97]-[98], 386-387 [161]. 278 Cf R v Khazaal [2006] NSWSC 1061 at [27]-[50]. and impartial tribunal279. Questions confronted have included: a non-citizen challenging executive detention on national security grounds being excluded from part of the hearing in which national security evidence is given280; control orders judicially reviewed on the basis of material not disclosed to the affected person281; a witness fearing intimidation giving anonymous evidence in a murder trial282; a race discrimination claimant being excluded from part of a hearing on grounds of national security283; and a Muslim witness in a sexual assault trial seeking to give evidence with her face covered by a niqab284. Questions of that nature, if they arise in Australia, are best left for consideration in concrete cases. What sufficiently emerges from their consideration by those other national Supreme Courts is a common approach that, while other interests may be balanced in fashioning a procedure appropriate to the context, the processes of a court, viewed as a whole, can never be unfair. There should be no doubt and no room for misunderstanding. Procedural fairness is an immutable characteristic of a court. No court in Australia can be required by statute to adopt an unfair procedure. If a procedure cannot be adopted without unfairness, then it cannot be required of a court. "[A]brogation of natural justice", to adopt the language of the explanatory notes to the Bill for the COA285, is anathema to Ch III of the Constitution. Chapter III of the Constitution admits of legislative choice as to how, not whether, procedural fairness is provided in the exercise of a jurisdiction invested in, or power conferred on, a court. Procedural fairness can be provided by different means in different contexts and may well be provided by different 279 Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1950); s 7 of the Canadian Charter of Rights and Freedoms. 280 Charkaoui v Canada (Citizenship and Immigration) [2007] 1 SCR 350. 281 Home Secretary v MB [2008] AC 440; Home Secretary v AF (No 3) [2010] 2 AC 282 R v Davis [2008] AC 1128. 283 Tariq v Home Office [2012] 1 AC 452. 284 R v S (N) (2012) 290 CCC (3d) 404. 285 Queensland, Legislative Assembly, Criminal Organisation Bill 2009, Explanatory Notes at 3. means in a single context286. The legislative choice as to how procedural fairness is provided extends to how procedural fairness is accommodated, in a particular context, to competing interests. The limits of that legislative choice need not, and therefore ought not, now be explored. In particular, it is not now necessary or appropriate to determine the extent, if at all, to which the avoidance of practical injustice in a particular context might necessitate "[c]onfrontation and the opportunity for cross- examination"287. Resolution of that issue is not foreclosed either by the description in Bass of judicial process as requiring parties to have an opportunity "to challenge the evidence led against them"288 or by the particular holdings in Gypsy Jokers, K-Generation and Wainohu. To answer the abstract questions reserved by the parties for the consideration of the Full Court so far as they concern the compatibility of criminal intelligence provisions of the COA with Ch III of the Constitution, it is sufficient to accept, as a starting-point, what is implicit in s 72(2) of the COA and what is conceded by the Solicitor-General of Queensland: that the protection of declared criminal intelligence by the COA may be unfair to a respondent to a substantive application in which that criminal intelligence is relied on as evidence. From that starting-point, it is sufficient to engage in an analysis that leads to the conclusion that nothing in the scheme of the COA or in procedural rules not excluded by the COA is necessarily sufficient to address that unfairness if it arises, but that the Supreme Court of Queensland retains inherent jurisdiction to stay a substantive application if unfairness becomes manifest. I now turn to that analysis. The COA The COA provides for a three-stage process. Stage one is the declaration of criminal intelligence. Stage two is the declaration of a criminal organisation. Stage three is the making of a control order, or a public safety order or a fortification removal order. 286 J v Lieschke (1987) 162 CLR 447 at 457; [1987] HCA 4; Coulter v The Queen (1988) 164 CLR 350 at 356; [1988] HCA 3; Western Australia v Ward (1997) 76 FCR 492 at 496-499, 508. 287 Lee v The Queen (1998) 195 CLR 594 at 602 [32]; [1998] HCA 60. 288 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 359 [56]. Stage one – the declaration of criminal intelligence – is anterior to the second and third stages. An application for a declaration of criminal intelligence must, by s 67, be decided before the information can be relied on in any substantive application. It must be decided in what ss 66 and 70 require to be a closed ex parte hearing. The requirement for the hearing to be ex parte does not of itself give rise to a want of procedural fairness. That is because a declaration of criminal intelligence has no consequences other than those given by the COA, being consequences only in respect of substantive applications under the COA. That is to say, a declaration of criminal intelligence at stage one has no effect on rights absent an application at stage two or stage three. The relevant question is then as to the effect on procedural fairness at that subsequent stage of the prior declaration of criminal intelligence. The question for the Supreme Court of Queensland at stage one is whether or not to make a declaration of criminal intelligence. It is, by 72(1), one of discretion. By s 72(2) read with s 72(7), a relevant consideration in the exercise of that discretion is whether matters giving information the status of criminal intelligence under s 60(a)(i)-(iii) – that the admission of the information into evidence in substantive applications under the COA would prejudice criminal investigations, enable the discovery of the existence or identity of confidential sources of information relevant to law enforcement or endanger someone's life or physical safety – "outweigh any unfairness" to "a respondent to any existing or possible substantive application in which [that] information ... may be considered" at the second or third stage. It is not difficult to see how unfairness to a respondent might arise. The protections afforded to declared criminal intelligence by ss 77 and 78 of the COA might well result in a particular respondent to a particular substantive application being left without any real practical opportunity to respond to declared criminal intelligence that is relied upon as evidence to establish one or more grounds for the making of the declaration or order. Other ways in which the statutory protection of declared criminal intelligence might give rise to practical injustice can be put to one side. The Solicitor-General of Queensland is correct to accept that, despite the permissive language of s 72(2), the relevant consideration it sets out is a mandatory relevant consideration in the exercise of the discretion conferred by s 72(1). He is correct to concede that "having regard to Chapter III of the Constitution, the matters mentioned in s 60(a)(i) to (iii) could never outweigh the public interest in ensuring that all trials are fair trials". He is therefore correct to concede that the discretion conferred by s 72(1) could never be exercised to make a criminal intelligence declaration in the face of an assessment at the time of declaration that the admission of the declared criminal intelligence into evidence in a substantive application would cause unfairness to a respondent to that substantive application. With one critical difference, the balancing required in the exercise of the discretion conferred by s 72(1) is not unlike the balancing required to determine public interest immunity at common law289. The critical difference is that the consequence of finding the balance in favour of making a declaration of criminal intelligence is not simply that the information is to be kept secret from a respondent but that the information may be deployed in secret against a respondent in a subsequent substantive application. Just as the balance would not favour public interest immunity in respect of information necessary to be disclosed in order fairly to dispose of proceedings290, so s 72(1) would not be exercised to make a declaration in respect of information assessed at the time of the exercise of the discretion to be necessary to be disclosed for a respondent fairly to meet a substantive application. Here is the difficulty. Inherent in the requirement of s 67 for the discretion conferred by s 72(1) always to be exercised in advance of a substantive application is that the assessment of unfairness has to be made as a prediction. What happens if the prediction turns out to be wrong? What happens, once criminal intelligence has been declared, if disclosure of the declared criminal intelligence turns out, in the events that subsequently occur, in truth to be necessary for a respondent fairly to meet a substantive application? Alert to the difficulty, the Solicitor-General of Queensland volunteers a solution which he suggests is to be found in the Uniform Civil Procedure Rules 1999 (Q), which are applied by s 101 of the COA in relation to applications made under it "to the extent the rules are consistent with [the COA]". He suggests that a declaration of criminal intelligence, as an "order … made in the absence of a party", is an order which r 667(2)(a) allows to be set aside at any time. The problem with his suggestion is that such an application of r 667(2)(a) runs counter to s 73(2), which provides for a criminal intelligence declaration to remain in force until revoked, and to s 74(1), which provides for revocation only on application by the commissioner of the police service. The evident legislative design is that criminal intelligence, once declared, is to remain subject to the protections afforded by the COA until revocation on application by the commissioner. As French CJ points out291, nothing in the COA displaces the inherent jurisdiction of the Supreme Court of Queensland, which includes power to dissolve a declaration of criminal intelligence for fraud or material non- disclosure. But the COA is inconsistent with any general ability of the Supreme Court of Queensland to set aside a declaration of criminal intelligence, on the application of a respondent to a substantive application or of its own motion. 289 Alister v The Queen (1984) 154 CLR 404 at 412, 469; [1984] HCA 85. 290 Al Rawi v Security Service [2012] 1 AC 531 at 605 [140]. The explanatory notes to the Bill for the COA suggest other solutions, taken up with varying degrees of enthusiasm by the Solicitor-General of Queensland and the interveners. One solution is suggested to lie in the presence of the COPIM. Analogies are sought to be drawn to the position of special advocates appointed under various statutory regimes. The extent to which those analogies are complete need not be explored. The COPIM does not act as an advocate for a respondent to a substantive application. The COPIM is not required to act in the interests of a respondent. The presence of the COPIM doubtless adds to the integrity of the process. But it cannot cure a want of procedural fairness. Another solution is suggested to lie in the ability of the Supreme Court of Queensland to determine the weight to be given to declared criminal intelligence. Procedural unfairness in an administrative process cannot be cured by a decision- maker choosing to ascribe no or little weight to adverse evidentiary material that has not been disclosed to a person whose rights or interests are affected by a decision. That is for a reason of principle292: "the necessity to disclose such material in order to accord procedural fairness is not based on answering a causal question as to whether the material did in fact play a part in influencing the decision, but rather on the appearance of a fair hearing and the maintenance of confidence in the administrative process and judicial review of it". It is not enough that a decision reached by an unfair process be "correct" in the result. The relevant inquiry is always "what procedures should have been followed?", never "what decision should the decision-maker have made[?]" or "what reasons did the decision-maker give for the conclusion reached[?]"293. The application of the principle to a court is stronger because the appearance of a fair hearing in a court and the maintenance of confidence in the curial process are constitutionally mandated. Yet another solution is suggested to lie in the width of the discretion allowed to the Supreme Court of Queensland in making a declaration of a criminal organisation or a control order, or a public safety order or a fortification removal order. This, on analysis, is only a slight variation of the suggestion that 292 NIB Health Funds Ltd v Private Health Insurance Administration Council (2002) 115 FCR 561 at 583 [84], quoted in part in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at 97 [19]; [2005] HCA 72. 293 Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at 97 [19]. the solution lies in the ability to determine the weight to be given to declared criminal intelligence. It admits of the same principled response. A discretion as to the result is no cure for a flaw in the process. To attempt to overcome a want of procedural fairness in a court by relying on the court to compensate in the way the court reasons to a decision is, in the long run, self-defeating. The attempted resolution leverages off the institutional integrity of the court. The problem is that the appearance, if not the actuality, of that institutional integrity will not endure if there is manifest unfairness in the procedure of the court. The procedural difficulty demands a procedural solution. There is a procedural solution. It is implicit in the acknowledgement by the Solicitor- General of Queensland that the use by the commissioner of declared criminal intelligence could in some circumstances amount to an abuse of process. The solution lies in the capacity of the Supreme Court of Queensland to stay a substantive application in the exercise of its inherent jurisdiction in any case in which practical unfairness to a respondent becomes manifest. The criminal intelligence provisions are saved from incompatibility with Ch III of the Constitution only by the preservation of that capacity. Conclusion The answer to each substantive question reserved is "no". The answers to the questions reserved do not determine questions not reserved and not argued. They do not determine whether s 108 of the COA is valid in requiring a closed hearing.
HIGH COURT OF AUSTRALIA APPELLANT AND AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION & ANOR RESPONDENTS Doyle v Australian Securities and Investments Commission [2005] HCA 78 14 December 2005 ORDER Appeal dismissed. Appellant to pay the first respondent's costs of the appeal. On appeal from the Supreme Court of Western Australia Representation: M J McCusker QC with K L Christensen for the appellant (instructed by K J Martin QC with C H Thompson for the first respondent (instructed by Australian Securities and Investments Commission) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Doyle v Australian Securities and Investments Commission Company law – Duties of directors – Claim against director for contravention of the Corporations Law, s 232(6) – Appellant was a director and shareholder of Doyle Capital Partners Pty Ltd ("DCP") and at the relevant times, either an alternate director or director of Chile Minera Ltd ("the Company") – DCP had been allotted shares in the Company in consideration of a payment of $400,000 with an assurance that its shares would rank pari passu with existing shareholders – Allotment was in breach of the listing rules of the Australian Stock Exchange – As an alternate director of the Company, appellant signed a circular resolution authorising the company secretary to procure the issue of a bank cheque for $400,000 payable to DCP, held pending further advice from ASX – Subsequently, as a director of the Company, appellant voted to cancel DCP's allotment of shares in the Company and to ratify the decision made in the circular resolution – Whether appellant made improper use of his position to gain an advantage for DCP – Whether appellant's conduct could be said to be improper if the other directors of the Company knew about his interest in DCP – Whether there could be any advantage to DCP if it had an arguable claim for return of the $400,000 on the basis that the Company's representation regarding DCP's shares ranking pari passu with existing shareholders had been denied effect by the intervention of ASX. Words and phrases – "improper", "advantage". Corporations Law, s 232(6). GLEESON CJ, GUMMOW, KIRBY, HAYNE AND CALLINAN JJ. The events giving rise to this litigation occurred in 1996 in Western Australia. At that time, the applicable corporations law was the Law set out in s 82 of the Corporations Act 1989 (Cth), as rendered applicable in Western Australia by s 7 of the Corporations (Western Australia) Act 1990 (WA). After a trial in the Supreme Court of Western Australia, Roberts-Smith J made a declaration pursuant to s 1317EA of the Law. This declared that the appellant, Mr Alan David Doyle, by his presence and voting at board meetings of Chile Minera NL ("the Company") on 21 and 22 November 1996 and by signing a Circular Resolution dated 21 November 1996, while being a director of the Company, had made improper use of his position as a director to gain directly an advantage for other persons and thereby had contravened s 232(6) of the Law. Thereafter, on 17 September 2002, Roberts-Smith J ordered that Mr Doyle pay to the Commonwealth the sum of $30,000 and that he be prohibited from managing a corporation for a period of two years from the date of that order. The pecuniary penalty was imposed after the finding required by s 1317EA(5) that the contravention of s 232(6) was a serious one. His Honour also noted that the burden of proof was that explained in Briginshaw v Briginshaw1. An appeal to the Full Court was heard by Wheeler, McLure and Jenkins JJ2. The Full Court varied the order of 17 September 2002 by reducing the period of the prohibition to a period of six months. Otherwise the appeal was dismissed. In this Court, the appellant seeks to have the finding of breach of s 232(6) of the Law set aside. The statutory provisions The text of s 232(6) has been considered by this Court in R v Byrnes3 and Angas Law Services Pty Ltd (In liq) v Carabelas4. The sub-section stated: (1938) 60 CLR 336 at 368. [2005] WASCA 17. (1995) 183 CLR 501. (2005) 79 ALJR 993; 215 ALR 110. Kirby Hayne Callinan "An officer or employee of a corporation must not, in relevant circumstances, make improper use of his or her position as such an officer or employee, to gain, directly or indirectly, an advantage for himself or herself or for any other person or to cause detriment to the corporation." An "officer" included a director (s 82A). Section 232(6) was a civil penalty provision for the purposes of the provisions respecting civil penalty orders made in Div 2 of Pt 9.4B of the Law (ss 1317EA-1317EH)5. Section 1317EB(1)(a) authorised the making by the Australian Securities and Investments Commission ("ASIC") of an application for a civil penalty order. Hence the role of ASIC as the first respondent in this appeal. The second respondent, Mr D W Satterthwaite, entered a submitting appearance. At the trial, a prayer for a declaration that Mr Doyle had contravened s 232A(1) of the Law had been abandoned. Section 232A(1) stated: "A director of a public company who has a material personal interest in a matter that is being considered at a meeting of the board, or of directors, of the company: (a) must not vote on the matter ...; and (b) must not be present while the matter ... is being considered at the meeting." Section 232A(1) did not apply if at any time the board had passed a resolution specifying the director, the interest and the matter and stating that the directors voting for the resolution were satisfied that the interest should not disqualify the director from considering or voting on the matter (s 232A(3)). There were no steps taken in the present case to attempt to enliven s 232A(3). The maximum penalty for a contravention of s 232A(1) was $500 (s 1311(5)). The commercial context The Company had been incorporated in Western Australia on 8 February 1985 under the name Ascot Mining NL. In 1991, this was changed to 5 Section 1317DA identified s 232(6) as a civil penalty provision. It did not identify s 232A. Kirby Hayne Callinan InterChrome NL. At an extraordinary general meeting held on 18 October 1996 ("the October EGM") to which it will be necessary to make further reference, a resolution was passed changing the name of the Company to Chile Minera NL. At that meeting, the Company also adopted new Articles of Association ("the Articles"). At all relevant times, Mr Doyle was a director of Doyle Capital Partners Pty Ltd ("DCP") and held 50 per cent of the issued shares in DCP. In August 1996, DCP was engaged as consultant to the Company with respect to potential mining interests in Chile, and to provide professional independent advice on technical and financial issues and to assist in raising capital. DCP was to be paid a fee of 6 per cent of the new capital raised. There were three directors of the Company at the time of the events upon which this litigation is centered. Mr B R Mountford was chairman; he was in Chile during the relevant period. The other directors were Mr Satterthwaite and Mr J D Hopkins. However, Mr Hopkins resigned on 15 November 1996. Mr Doyle became a director on 22 November and resigned on 28 November; on 21 November, he had been an alternate director for Mr Mountford. Mr C B The Company had held mining interests in various countries. In the course of the 1995-1996 financial year, the Company ceased its involvements in Ghana, the Philippines and New Zealand. The consolidated results for that financial year showed accumulated losses of $12,379,042. On 25 September 1996, Mr Satterthwaite wrote to shareholders that the board had resolved to concentrate in Chile all of its exploration efforts and, in particular, to acquire a 75 per cent interest in the Carrizal Alto Prospect. At the October EGM, held on 18 October, a resolution approving that acquisition was passed on a show of hands, but with signs of strong minority shareholder dissent. Following the engagement of DCP, there had been discussion between Mr Doyle and Mr Satterthwaite respecting the placing of shares and options to raise working capital for the Company. The trial judge found that the Company had represented to Mr Doyle that the shares would rank pari passu with existing shareholders. Thereafter, on 16 October, the Company allotted 8 million ordinary 50 cent shares to three parties, Banque Privée Edmond de Rothschild SA (1 million shares), Cramm Nominees Pty Ltd (3 million shares) and DCP (4 million shares). The new shares were issued at a discount of 45 cents per share, thereby raising for the Company an additional share capital of $400,000. Kirby Hayne Callinan Each of the new shares had attached to it an option to require the Company to allot to the holder one fully paid share, the option being exercisable before 20 June 2000 at an exercise price of 20 cents. The Company paid DCP a fee of $24,000 for bringing about the share placement. The subscription moneys of $400,000 were paid by DCP to the Company on 16 or 17 October. At the time of these events, the Company had been admitted to the official list of the Australian Stock Exchange ("ASX") and its ordinary shares were listed for official quotation at a par value of 50 cents. As McLure J emphasised in her reasons in the Full Court, it was an implied term of any contract for allotment of shares that the Company comply with the ASX Listing Rules. One of those Rules (LR 7.1) prohibited a company from issuing more than 10 per cent of its capital in one class in any 12 month period without the approval of the holders of ordinary securities. The Law also6 placed restrictions upon the acquisition of shares. On 17 October 1996, the ASX wrote to the Company referring to the placement and pointing to the apparent infringement of LR 7.1. On 18 October, Mr Murphy, the Company Secretary, responded conceding that the placement had exceeded by 51,242 shares the 10 per cent limit and stating that the situation would be remedied at the Annual General Meeting set down for 22 November 1996 ("the November AGM"). In his reasons, Roberts-Smith J noted that there had been a difference of opinion as to the extent of the breach of LR 7.1 and that the ASX records showed that the 10 per cent limit had been exceeded by a much more significant figure. Further correspondence with the ASX followed. One matter of concern to the ASX was whether the allottees of the placement organised by DCP had voted those shares at the October EGM. On 13 November, the Australian Securities Commission, the precursor to ASIC, instituted proceedings in the Federal Court seeking orders setting aside the resolution passed at the October EGM to approve the acquisition of the Carrizal Alto Prospect. On 22 November, Carr J granted interim relief. By final orders made on 2 December, the Company was restrained from proceeding with the acquisition until it had shareholder approval as required by the Law and by LR 7.1. Section 195 of the Law set down a detailed procedure for the reduction of share capital, requiring a special resolution of members and subject to court 6 Sections 615, 623. Kirby Hayne Callinan confirmation. However, in Commonwealth Homes and Investment Co Ltd v MacKellar7, this Court held that a bona fide dispute between a company and a person whose name appears on its share register which arises from a claim that the allotment of shares is void or voidable may, consistently with the provisions of company law respecting reduction of capital, be the subject of a compromise resulting in the cancellation of allotment of the shares and the removal of the name of the person from the share register. On the other hand, as Street CJ in Eq held in Reinvestment (Australia) Ltd v Murray Securities Ltd8, the reasoning in Commonwealth Homes did not apply where no more appeared than that subsequent difficulties with the ASX had caused the company and the allottee to decide that it would be preferable to terminate their arrangement and to remove the issued shares from the register. The board meetings On 21 November 1996, during the pendency of the Federal Court litigation, Mr Doyle, on behalf of DCP, wrote to the directors of the Company. He demanded repayment by the Company of the placement moneys of $400,000 as a result of the ASX stating that the placement had been in breach of LR 7.1. A board meeting was convened in Perth later on that day. Messrs Doyle, Satterthwaite and Murphy were present, Mr Doyle as alternate for Mr Mountford. Messrs Doyle and Satterthwaite voted in favour of resolutions that (a) the $400,000 be returned to the trust account of DCP but with release of these funds only to be made upon return to the Company of its 8 million shares and options, and (b) the placement fee be returned by DCP to the Company. Further, a document entitled "Circular Resolution of the Directors on Thursday 21st November, 1996" was signed by Mr Satterthwaite, and by Mr Doyle as alternate for Mr Mountford; this contained a resolution authorising the Company Secretary to procure the issue of a bank cheque for $400,000 payable to DCP "to be held pending advice from [ASX] as to their ruling on the ability of these new shareholders to exercise their vote". Before the board meeting of 21 November, Mr Nash, a partner of the firm which was solicitors to the Company, had advised Mr Murphy "off-the-cuff" to the effect that the money could be returned to DCP provided it went into a trust account pending the advice of counsel. Counsel's written advice was received by (1939) 63 CLR 351. Kirby Hayne Callinan the Company after the critical events, on 17 December. The advice noted deficiencies in the materials and facts briefed but concluded that the payment of $400,000 was a reduction in share capital requiring a special resolution of shareholders and court confirmation. Counsel noted the absence from the material briefed of evidence of grounds on which the issue might be set aside in accordance with Commonwealth Homes9; the facts appeared to go no further than At the other critical board meeting, that held on 22 November, Messrs Doyle, Satterthwaite and Mountford voted in favour of resolutions that the placement of shares be cancelled and that the decision of the 21 November board meeting for the return of the placement moneys be ratified provided that the Company receive the refund of the placement fee. Mr Doyle earlier that day had consented to act as a director of the Company. Mr Mountford was shown in the minutes as participating "by phone". Thereafter, $400,000 was paid into a trust account maintained by DCP with the National Australia Bank. The aftermath This board meeting of 22 November was held later on the day of the November AGM. At that meeting, there was noted a requisition by one of the disaffected shareholders, Metalsearch NL, for an extraordinary general meeting to elect new directors. that The trial judge found insolvent by 26 November, and that the payment out of the $400,000 was a dominant contributing factor to that state of affairs. On 17 January 1997, after Mr Doyle refused to return the $400,000 to the Company, an administrator was appointed by the directors of the Company, they then being of opinion that the Company was insolvent. the Company became On 4 February 1997, the Company instituted proceedings in the Supreme Court of Western Australia against DCP seeking, among other relief, repayment of the placement moneys. Thereafter, on 7 February, at an extraordinary general meeting, the directors were removed and other persons appointed. On 7 March, proceedings in the Supreme Court of Western Australia were taken by the (1939) 63 CLR 351. Kirby Hayne Callinan Company against Messrs Doyle, Satterthwaite and Mountford. Both proceedings were eventually settled with payment by DCP to the Company of $250,000, less the placement fee of $24,000. Two further points should be noted at this stage. The first is that Mr Doyle had been acting on 21 and 22 November in such a fashion as to render him a director within the meaning of s 60 of the Law11. Paragraph (a) of s 60(1) included within the meaning of the scope of the term "director" as found in the Law: "a person occupying or acting in the position of director of the body, by whatever name called and whether or not validly appointed to occupy, or duly authorised to act in, the position". It followed that he was an "officer" within the meaning of s 232(6) of the Law12. The second concerns the Articles. Provision for alternate directors was made by Art 15.6. Article 15.2 provided that, subject to Art 15, the directors might regulate their meetings as they thought fit. Article 15.3 stated that no business was to be transacted unless there was present a quorum comprising two directors present in person. Article 16.1 provided for meetings linking together by instantaneous communication a number of directors being not less than the quorum. The result of reading Arts 15.3 and 16.1 together was that, if a quorum was present at the place where the meeting was held, other directors might participate through the means of instantaneous communication from elsewhere. However, at the meetings of 21 and 22 November, Mr Doyle's presence (with that of Mr Satterthwaite) had been necessary for the constitution of a quorum. The participation of Mr Mountford by telephone at the 22 November meeting did not alter that situation. Article 15.15 dealt with disclosure of interests. It stated: "Subject to the Listing Rules, no Director shall be disqualified by his office from contracting with the Company whether as vendor purchaser or otherwise, nor shall any such contract or any contract or arrangement entered into by or on behalf of the Company in which any Director shall 11 See Corporate Affairs Commission v Drysdale (1978) 141 CLR 236. 12 See the definition of "officer" in s 82A. Kirby Hayne Callinan be in any way interested be avoided or prejudiced on that account ... but the nature of his interest must be disclosed by him at a Directors' meeting as soon as practicable after the relevant facts have come to his knowledge and such Director shall not vote on any resolution relating to a contract or arrangement in which he has directly or indirectly a material interest." (emphasis added) The trial judge held that "the return of [the $400,000] to DCP and [Mr Doyle's] control when the allottees had [not] established lawful entitlement to it, or when any such entitlement to it was in question, was an advantage to them", and that Mr Doyle used his position improperly to put the interests of the allottees ahead of those of the Company. The Full Court In the Full Court, the principal reasons were delivered by McLure J. Her Honour noted the absence of a finding as to what had actually been resolved and agreed with DCP as to the repayment arrangements. However, the documentary evidence and the unchallenged findings of the trial judge enabled the Full Court itself to consider those arrangements. The trial judge had found a common intention of Messrs Doyle, Satterthwaite and Mountford that DCP hold the placement moneys on trust pending the provision of counsel's opinion and resolution of the legal issues. McLure J further concluded that, although the parties differed as to whether or not counsel's opinion would be accepted by the parties as determinative, the arrangement was that: "in the event the cancellation of the allotment was accepted by both parties as valid or was established to be valid, the moneys would be paid to the allottees and if the cancellation was invalid, the money would be returned to the Company". The next question considered by McLure J was whether the purported avoidance by DCP of the placement and cancellation of the allotment by the Company effected a reduction in the capital of the Company. Her Honour held that there had been a reduction in capital, but that there had been a bona fide compromise of an arguable claim, with the result that there had been no unauthorised reduction of capital. The appeal to this Court may be decided without detailed consideration of the correctness of that conclusion. It may be assumed in favour of the appellant that DCP and the other investors had at least an arguable claim against the Company to the return of the $400,000. Kirby Hayne Callinan McLure J held that Mr Doyle had contravened s 232(6) of the Law. The crux of the reasoning of her Honour respecting the contravention of s 232(6) appears in the following passage: "The relevant improper conduct was, as found by the trial Judge, [Mr Doyle's] presence at the board meetings on 21 and 22 November and his voting on the [resolutions] and Circular Resolution. Such conduct was itself improper as it breached s 232A(1) [of the Law]. [Mr Doyle's] purpose and intention in attending and voting at the board meetings has to be garnered from the surrounding circumstances at the time of the conduct in question, including his then state of knowledge. The trial Judge found that [Mr Doyle] was aware of [Mr Nash's] advice and concluded that his purpose in engaging in the conduct (objectively determined to be improper) was to advantage the allottees, including DCP, that advantage being the return of the money to DCP and [Mr Doyle's] control when the allottees had no established lawful entitlement to it or when any such entitlement was in question. That finding was clearly open and consistent with the weight of the evidence. It is not negatived or undermined by what in due course is found to be the correct legal position or that the course of action was consistent with legal advice given to the Company." The appellant's submissions McLure J had introduced her statement of conclusions with an analysis of the elements of s 232(6). It is, of course, true that the sub-section must be read as a whole, but the analysis assists an understanding of the submissions made by the appellant in this Court. McLure J had said: "[I]n order to breach s 232(6) [of the Law] the following elements have to be established: (1) the defendant was at the relevant time an officer or employee of a corporation; (2) he used his position as such officer or employee; (3) his use of his position was improper; (4) he made that improper use for the purpose of gaining, directly or indirectly, an advantage, alternatively he made that improper use for the purpose of causing detriment; (5) the advantage was either for himself or for another person, alternatively, the detriment was to the corporation." Mr Doyle at the relevant time was an officer of the Company, namely a director, and he used that position to vote on resolutions relating to matters in which he had a material interest as a director and a 50 per cent shareholder of DCP. Elements (1) and (2) were present. Kirby Hayne Callinan However, as to element (3), counsel for Mr Doyle asked how could it be that a director made improper use of that position by being present at, and participating in, a meeting of directors when the matter in which the director had an interest was disclosed to, and known to, those present and the decision was to do something neither unlawful nor improper, or one as to which the director held a reasonable belief that it was not unlawful or improper. The framing of the issue respecting element (3) in that way presents it at a level of excessive generality. Impropriety on the part of Mr Doyle would consist in a breach of the standards of conduct that would be expected of a person in his position by reasonable persons with knowledge of the duties, powers and authority of his position as director, and the circumstances of the case, including the commercial context13. Such standards, expressed according to objective criteria, are ultimately stated, as necessary, by the courts. An account has been given earlier in these reasons of the circumstances leading to the events of 21 and 22 November 1996 and the situation in which the actors then found themselves. The activities of the Company in Chile had attracted dissent among the shareholders, the placement arranged by Mr Doyle was disputed by the ASX, the Federal Court had granted interim relief respecting the resolution at the October EGM approving the Carrizal Alto Prospect, and there was an unresolved question respecting an unauthorised reduction in the capital of the Company and a threat of delisting. The investment by DCP and the other parties who, together, had provided the $400,000 appeared to be in jeopardy; hence the means adopted to advance the position of the investors towards recovery of their $400,000. On the part of Mr Doyle, there was, as McLure J noted, the engagement in conduct in contravention of s 232A(1) of the Law. He also disobeyed the prohibition in Art 15.15 of the Articles upon directors voting on any resolution relating to a contract or arrangement in which the director has directly or indirectly a material interest. There may be in some cases of unconscious inadvertence a question whether there necessarily has been an improper use of position. The interrelation between s 232A and the civil penalty provisions including s 232(6) was not explored in submissions or argument. But those 13 R v Byrnes (1995) 183 CLR 501 at 514-515; Angas Law Services Pty Ltd (In liq) v Carabelas (2005) 79 ALJR 993 at 1006-1007 [65], 1008 [72]; 215 ALR 110 at Kirby Hayne Callinan questions may be put to one side. That is because the present is not a case of unconscious inadvertence. In any event, as was emphasised in R v Byrnes14, impropriety may consist in the doing of an act for which the officer ought to know there was an absence of authority; there is no safe haven for the morally obtuse. The existence of the conflict of interest was known to Mr Doyle, Mr Satterthwaite and Mr Mountford; the contrary is not asserted. Rather, the appellant seeks to rely upon the very disclosure and knowledge of the existence of the conflict as an answer to the suggested improper use of position by The difficulty with that submission lies in the particular circumstances of the case. The disclosure of the interest of Mr Doyle could provide no answer in the situation where those to whom he made the disclosure were his confederates in the activity generating the interest. Those shareholders who were unhappy with the Carrizal Alto mining project and whose dissatisfaction had been apparent at the October EGM lacked any voice on the board on 21 and 22 November. In oral argument, counsel for Mr Doyle spoke of his client as having acted under "a claim of right" to the return of the placement moneys. It was said that DCP and the other investors were "entitled" to a return of their money by the Company, and there could be no improper use by Mr Doyle of his position, within the meaning of s 232(6), in taking the steps he took on 21 and 22 November. There is no scope when applying s 232(6) to the facts of this case for an incorporation of the doctrine of "a claim of right". Section 232(6) is a civil penalty provision. In Macleod v The Queen15, Gleeson CJ, Gummow and Hayne JJ referred to the claim of right as a manifestation of the principle in criminal law that an honestly held belief, whether reasonable or otherwise, may be inconsistent with the existence of that intent which forms an ingredient of a particular crime. Whilst the presence of intention or purpose may be relevant in 14 (1995) 183 CLR 501 at 514-515. 15 (2003) 214 CLR 230 at 242-243 [39]. Kirby Hayne Callinan assessing impropriety, it is not an ingredient in the requirement of improper use of position16. Counsel for Mr Doyle also asked how could it be that Mr Doyle had sought to gain an advantage (element (4) of s 232(6)) when DCP and the investors it represented had at least an arguable claim for the return of the subscription moneys on the footing that the representation by the Company to Mr Doyle respecting listing had been denied effect as a result of the intervention of ASX. However, on the facts established in the Full Court, not only was there a purpose of gaining an advantage, but the advantage had been achieved. In place of an unsecured claim to the recovery of moneys by DCP, steps were followed in November 1996 which produced the result that a segregated fund was held on trust for a beneficiary which would be DCP if the opinion of counsel proved favourable. That put DCP a step well ahead of what otherwise was its position. The point may be illustrated as follows. Given the situation in November 1996, it would have required the high degree of caution spoken of in Cardile v LED Builders Pty Ltd17 on the part of a court asked to make an asset preservation order against the Company at the suit of DCP. Furthermore, even if made, such an order would not have deprived the Company either of title to or possession of any assets to which the order extended18. Orders The attack on the decision of the Full Court fails. The appeal should be dismissed and the costs of ASIC of the appeal should be borne by the appellant. 16 R v Byrnes (1995) 183 CLR 501 at 512, 513-515, 521-522; Angas Law Services Pty Ltd (In liq) v Carabelas (2005) 79 ALJR 993 at 1006-1007 [65]; 215 ALR 110 at 17 (1999) 198 CLR 380 at 403 [50]. 18 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 403 [50].
HIGH COURT OF AUSTRALIA VAUGHAN RUDD BLANK APPELLANT AND COMMISSIONER OF TAXATION RESPONDENT Blank v Commissioner of Taxation [2016] HCA 42 9 November 2016 ORDER Appeal dismissed with costs. Application for special leave to cross-appeal dismissed with costs. On appeal from the Federal Court of Australia Representation M Richmond SC with T O Prince for the appellant (instructed by Clayton Utz Lawyers) J T Gleeson SC, Solicitor-General of the Commonwealth and J O Hmelnitsky SC with M J O'Meara for the respondent (instructed by Minter Ellison Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Blank v Commissioner of Taxation Income tax – Assessable income – Where taxpayer participated in employee incentive profit participation agreement – Taxpayer granted claim to deferred compensation calculated on basis of company profit – Amount payable under agreement to taxpayer on termination of employment and execution of declaration of assignment and release – Whether amount income according to ordinary concepts or capital gain. Words and phrases – "deferred compensation", "Genussscheine", "incentive profit participation agreement", "ordinary income", "pecuniary account". Income Tax Assessment Act 1936 (Cth), s 26(e). Income Tax Assessment Act 1997 (Cth), s 6-5(1), (4). Swiss Code of Obligations, Art 657. FRENCH CJ, KIEFEL, GAGELER, KEANE AND GORDON JJ. Introduction The appellant, Mr Blank, was employed by Glencore Australia Pty Ltd, a wholly owned subsidiary of Glencore International AG ("GI"). Glencore Australia provided services including the services of Mr Blank to Glencore AG, also a wholly owned subsidiary of GI. An incentive profit participation agreement between Mr Blank, GI and Glencore AG provided "deferred compensation" for services to be rendered by Mr Blank, payable after notice of termination of his employment ("the IPPA 2005"). Mr Blank resigned and, pursuant to the IPPA 2005, on 15 March 2007 he became entitled to receive USD 160,033,328.25 payable in instalments ("the Amount"). Was the Amount income according to ordinary concepts and therefore part of Mr Blank's assessable income pursuant to s 6-5 of the Income Tax Assessment Act 1997 (Cth) ("the 1997 Act")? The answer is "yes". Mr Blank did not return the Amount as income according to ordinary concepts but treated the 15 March 2007 event as giving rise to a capital gain in the 2007 income year. On appeal to this Court, Mr Blank contended that the Amount was the proceeds of the exploitation of interconnected rights that conferred on him a right to receive, in the future, a proportion of the profit of GI and therefore assessable as a capital gain. That contention should be rejected. the Accordingly, the the alternative contentions of Commissioner of Taxation, that the Amount was assessable income in Mr Blank's hands on other bases – under the second limb of Federal Commissioner of Taxation v Myer Emporium Ltd1 or as an eligible termination payment under s 27A(1) of the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act") or an employment termination payment under s 82-130(1)(a)(i) of the 1997 Act (both "ETP") – do not arise. Similarly, any issue about how the cost base of any "rights" was to be determined if the Amount was in the nature of a capital gain does not arise. respondent, The appeal should be dismissed with costs. By an application for special leave to cross-appeal, the Commissioner sought to contend that if the Amount was assessable income under s 6-5 of the 1997 Act, then Mr Blank derived two instalments of the Amount in the (1987) 163 CLR 199; [1987] HCA 18. Gordon 2007 income year because those instalments were "applied or dealt with" on his behalf or as he directed within the meaning of s 6-5(4) of the 1997 Act ("the timing question"). Special leave to cross-appeal on the timing question should be refused. The special leave application should otherwise be dismissed because the other issues do not arise. These reasons will address the facts and then turn to consider whether the Amount was income according to ordinary concepts and therefore part of Mr Blank's assessable income pursuant to s 6-5 of the 1997 Act. Finally, the Commissioner's application for special leave to cross-appeal on the timing question will be addressed. Facts The Glencore Group and Mr Blank's employment Glencore Holding AG ("GH") was the ultimate holding company of the Glencore group of companies ("the Glencore Group"). The Glencore Group operated one of the world's largest international commodity trading businesses. GI was incorporated in Switzerland. 85% of the shares in GI were held by GH. Until 2002, the remaining 15% of the shares in GI were held by an unrelated industrial company. From 2002, the remaining 15% of the shares in GI were owned by Glencore LTE AG, another company in the Glencore Group. The shares in GH and Glencore LTE AG were owned by employees of the Glencore Group who were invited and agreed to participate in "employee profit participation plans" operated by GI. Key employees of GI were therefore the indirect owners of shares in GI. Between November 1991 and 31 December 2006, Mr Blank was employed by either GI or one of its wholly owned subsidiaries and, until early 2002, he worked variously in South Africa, Switzerland and Hong Kong. Mr Blank arrived in Australia in early 2002 to take up a position as a senior trader in the coal division with Glencore Australia. Mr Blank became a resident of Australia on 2 January 2002 and retained that fiscal status. Profit participation agreements and shareholders' agreements From about 1993 until 2010, GI operated employee profit participation plans. Certain employees of GI and its subsidiaries were selected to participate in a plan and become entitled to receive financial benefits. Employees' Gordon participation in the plans was in addition to their salary and any bonuses they were entitled to receive. Mr Blank's participation was initially governed by two "stapled" agreements – an agreement with GI entitled "Profit Participation Agreement" ("the PPA 1993") and an agreement with GH entitled "Shareholders' Agreement" ("the SA 1994"). They were "stapled" in that the validity of each of the PPA 1993 and the SA 1994 depended on the execution of the other agreement. The PPA 1993 was amended in 1996 and replaced prospectively in October 1999 by a new profit participation agreement with GI ("the PPA 1999"). It was common ground that the PPA 1993, the PPA 1993 (as amended in 1996) and the PPA 1999 were substantially similar. It is therefore necessary to turn to consider the terms of the PPA 1999. The PPA 1999 and the SA 1994 Under the PPA 1999, Mr Blank was granted a "Profit Participation", form of results[2] of GI", defined as "a participation (a) "Genussscheine" ("GS") and (b) a contractual claim3. in the the GS are provided for by Art 657 of the Swiss Code of Obligations. The English translation of Art 657 relied on by the parties translated GS as "profit sharing certificates" and relevantly provided: The articles of incorporation may foresee the creation of profit sharing certificates in favor of persons who are linked with the Company … as … employee or in a similar way. They must state the number of issued profit sharing certificates and the content of the rights attached thereto. With the profit sharing certificates, the persons entitled may be granted claims only to a share of the balance sheet profit … The profit sharing certificate shall not have a par value; it shall neither be called participation certificate nor be issued against a contribution which is shown under the assets in the balance sheet." (emphasis added) 2 The PPA 1993 used the expression "future profits" rather than "results". cl A.1 of the PPA 1999. Gordon An English translation of Art 8 of GI's Articles of Incorporation, entitled "Profit Sharing Certificates", recorded that GI had issued 150,000 profit sharing certificates "intended for distribution to employees" of GI or any other company controlled by GI4. Article 8.2 relevantly recorded that: "A profit sharing certificate grants upon restitution to [GI] a claim to a cumulative portion of the balance sheet profit … during the period of ownership in the profit sharing certificate in proportion to the total number of profit sharing certificates effectively issued at any given time. However, if a holder of profit sharing certificates ceases to be an employee of [GI], or of other companies directly or indirectly controlled by [GI], then he shall on cessation transfer any profit sharing certificates to [GI] and he shall have no claim to any payment from [GI] in respect of the restitution to [GI] of any profit sharing certificates allocated within 24 months of the date of cessation, except if termination of employment is due to death or disability." (emphasis added) This provision is important. Consistently with Art 657 of the Swiss Code of Obligations, it provides that a profit sharing certificate – a GS – grants a claim to a cumulative portion of the balance sheet profit. However, Art 8.2 states that the claim is granted not upon the issue or allocation of the GS to the employee, but upon restitution to GI of the GS, and then only in respect of those GS issued more than 24 months before employment ceases. The limited nature of the GS is reinforced by other provisions of GI's Articles. The holders of GS have no voting rights (or rights in connection with voting), no right to call a general meeting of shareholders, no right to attend a shareholders' meeting, no right to information, no right of inspection and no right to move motions5. The PPA 1999 recorded that GI's Articles authorised it to issue GS registered in the name of a holder (an employee) which "grant a claim to profit participation"6 (emphasis added). Under the PPA 1999, the Profit Participation was calculated as follows. First, with effect from 31 December each year, the net income of GI on a consolidated basis was adjusted in accordance with an Annexure to the 4 Art 8.1 of GI's Articles. 5 Art 8.3 of GI's Articles. cl A.3.1 of the PPA 1999. Gordon PPA 1999 to establish the "Net Income for Profit Participation"7. Mr Blank, as a holder of GS, was allocated a portion of that Net Income for Profit Participation for a particular year in the proportion of the number of GS held by him to the total number of GS on issue8 ("Periodical Profit Participation"). The Periodical Profit Participation was allocated as profit participation under the GS and the contractual claim in a 55/45 split9. The Periodical Profit Participation for each issue of GS to Mr Blank was "aggregated" over the period he held GS from the date the GS were allocated up to and including, relevantly, the last day of the month in which notice of termination of employment was received ("the Notice Date")10. The PPA 1999 reinforced the terms of Art 8 of GI's Articles and provided that the only GS to "participate" in the Net Income for Profit Participation were those GS which, on the Notice Date, had been allocated for more than 24 months11. If a holder of GS ceased employment, returned all GS to GI and executed a declaration of assignment and general release substantially in the form annexed to the PPA 1999, then, 30 days after the Notice Date, that ex-employee's Profit Participation became due as a debt bearing interest and was to be paid in USD in 20 equal quarterly instalments12. A proportion of each instalment was to be withheld and paid to the Swiss Federal Tax Administration ("the Swiss FTA") on account of Swiss withholding tax13, that proportion being 35% of the 55% of the instalment distributed under the GS. That proportion applied so long as approval by the Swiss FTA was maintained for 55% of the Profit Participation to be paid cll A.2.1 and A.2.2 of the PPA 1999. cll A.2.2 and A.2.3 of the PPA 1999. cl A.2.3 of the PPA 1999. 10 cl A.2.4 of the PPA 1999. 11 cll A.2.2 and A.2.3 of the PPA 1999. 12 cll A.5, A.6.1, A.6.2, A.7 of the PPA 1999. 13 cl A.9 of the PPA 1999. Gordon as "profit distribution under his GS" and the balance (45%) under the contractual claim14. GI could offer to repurchase Mr Blank's GS prior to termination of employment on terms not more favourable than his Profit Participation15. GI did not enter into such an arrangement with Mr Blank. Mr Blank did not have a contractual right to require GI to repurchase GS from him. The PPA 1999 was "stapled" to the SA 1994 in the sense that the validity of the PPA 1999 was conditional on the execution of the SA 199416. Under the SA 1994, Mr Blank was entitled to purchase and be issued shares in GH from time to time at their par value of CHF 50 per share, provided that he had executed a profit participation agreement with GI, executed the SA 1994 and paid cash for the shares17. Upon occurrence of a "Triggering Event", including termination of employment of the employee, GH had a call option by which it could require Mr Blank to sell to it the shares in GH at their par value18. The employee could not sell, assign, transfer or otherwise deal with the shares in GH without the prior written consent of GH19 or the occurrence of a Triggering Event. The SA 1994 also provided that GH, in its capacity as majority shareholder in GI, would to the extent permitted by law provide that "profits [of GI] are otherwise distributed according to [GI's] contractual obligations", and "in particular" under profit participation plans concluded with shareholders of 14 cll A.3.5 and A.4 of the PPA 1999. 15 cl A.10 of the PPA 1999. 16 cl B.1 of the PPA 1999. 17 cll A.2 and B.5 of the SA 1994. 18 cl D.4.1 of the SA 1994. 19 cl D.3 of the SA 1994. 20 cl C.2.3.1 of the SA 1994. Gordon Between 1994 and May 2002, Mr Blank was successively issued with a total of 1,500 GS by GI and subscribed for an equal number of shares in GH. The IPPA 2003 In about June 2003, Mr Blank executed an agreement entitled "Incentive Profit Participation Agreement" ("the IPPA 2003") with GI and Glencore AG. The Preamble recorded that Mr Blank was employed by a subsidiary of GI – at that time, Glencore Australia. That subsidiary provided services including the services of Mr Blank to Glencore AG. The IPPA 2003, between Mr Blank, GI and Glencore AG, provided "deferred compensation" in "consideration of the services to be rendered" by him to the subsidiary21, payable after notice of termination of his employment. In an English translation of Art III of Glencore AG's Articles of Association, which dealt with GS, "Genussscheine" was translated to mean "bonus papers" and the article relevantly recorded that: "The company may issue up to 150,000 [GS] to its … staff … When it is handed back to the company, a [GS] gives an entitlement to a cumulative share of the balance sheet profit to be determined by the General Meeting on the basis of the change in the equity capital during the period of possession of the [GS], in proportion to the total number of [GS] effectively issued on each occasion. The holders of [GS] have no voting rights and none of the accompanying rights, in particular no right to convene a General Meeting, no right to attend meetings, no right to information, no right to inspect documents and no right to make proposals. The [GS] are registered and may not be transferred to third parties without the approval of the Board of Directors; such approval may be withheld without stating reasons … The company may at any time withdraw and re-issue [GS] which have already been issued. 21 pars 4 and 5 of the Preamble to the IPPA 2003. Gordon The person whose name is entered in the [GS] register is regarded as the owner of that [GS] in relation to the company. Ownership of a [GS] and the exercise of any rights carried by that [GS] presupposes acknowledgement of the articles of association in their currently valid version." (emphasis added) Under the IPPA 2003, rather than Mr Blank being issued with GS by GI, Glencore AG agreed to issue GS to GI22. The IPPA 2003 recorded that the GS issued by Glencore AG to GI under Art 657 of the Swiss Code of Obligations were "[s]olely for [the] purposes of calculating the amount of Profit Participation" and were to "serve as phantom units (PHANTOM UNITS) for the purpose of calculating" Mr Blank's Profit Participation under the IPPA 2003, which was the "deferred compensation"23. Mr Blank had no interest whatsoever in the GS issued by Glencore AG24. A Phantom Unit issued under the IPPA 2003 had the same purpose as a GS – as the calculation mechanism for determining an employee's Profit Participation. Unlike the PPA 1993, which defined Profit Participation as participation in the "future profits" of GI, or the PPA 1999, which defined Profit Participation as participation in the "results" of GI, the IPPA 2003 defined Profit Participation as "deferred compensation which will be calculated on the basis of the results of In July 2003, Mr Blank was allocated 100 Phantom Units and purchased 100 shares in GH. 22 cll A.1.1 and A.1.2 of the IPPA 2003. 23 cll A.1.1 and A.1.2 of the IPPA 2003. 24 cl A.1.2 of the IPPA 2003. 25 cl A.1.1 of the IPPA 2003. Gordon The IPPA 2005 and the SA 2005 In 2005, Mr Blank entered into the IPPA 2005, an "Incentive Profit Participation Agreement" with GI and Glencore AG, and a "Shareholders' Agreement" with GH ("the SA 2005"). The Preamble to the IPPA 2005 recorded that Glencore Australia performed services including the services of one of its employees, Mr Blank, for Glencore AG under a Service Agreement. The IPPA 2005 was an incentive profit participation agreement between Mr Blank, GI and Glencore AG to provide "deferred compensation" for services to be rendered by Mr Blank to Glencore Australia in connection with the Service Agreement, but payable after notice of termination of his employment. The Preamble also recorded that GI had adopted a "plan of deferred compensation known as the 'Incentive Profit Participation Plan'" for selected employees of GI and its subsidiaries "in consideration of the services to be rendered by" Mr Blank. The IPPA 2005 terminated forthwith "[a]ny prior oral or written agreement related to the PPU which are the subject matter of this Agreement"26 (emphasis added). "PPU" was defined in the IPPA 2005 to mean27: "[T]he number of GS actually allocated and participating as of a respective date, whether issued by [Glencore] AG under the Plan and any Incentive Profit Participation Agreement (including this Agreement) and held by GI in accordance with the terms of the Plan and this Agreement or GS issued by GI and held directly by Employees of GI or any of its Subsidiaries pursuant to profit participation agreements." (emphasis added) That is, all GS or equivalents issued under previous profit participation plans became PPU under the IPPA 2005, with Allocation Dates the same as the dates on which the GS or equivalents had previously been issued28. Thus, the IPPA 2005 regulated both the 1,500 GS and the 100 Phantom Units previously allocated to Mr Blank, and was the agreement on foot that governed Mr Blank's entitlements when his employment was terminated. The IPPA 2005 26 cl C.7 of the IPPA 2005. 27 Item 17 of the definitions in the IPPA 2005. 28 cl A.3.2 and Annex B of the IPPA 2005. Gordon replaced any rights and obligations under previous profit participation plans with the rights and obligations under the IPPA 2005. Such replacement can be described as novation, in the "sense [that] 'novation' means simply a new contract standing in the place of the old"29. Under the IPPA 2005, GI granted Mr Blank "deferred compensation" to be calculated on the basis of the results of GI, referred to as the Incentive Profit Participation or "IPP"30. The GS issued by Glencore AG and "owned and held by GI" were issued solely for the purpose of implementing the plan "and calculating the amount of deferred compensation in the form of PPU" which would be allocated to Mr Blank31. Mr Blank had no interest whatsoever in the GS32. The IPPA 2005 recognised that Glencore AG had issued GS to GI and stated that the GS would "serve as the PPU hereunder"33. The IPP "commence[d] as of the Allocation Date"34. "Allocation Date" was defined to mean the date when the PPU were allocated35. However, only the PPU allocated at the Notice Date for more than 24 months from the Allocation Date were "vested"36. "Notice Date" was relevantly defined to mean "the last day ... of the month notice of termination of [Mr Blank] by GI or a Subsidiary is received either by [Mr Blank] or by the employing company"37. "Net Income for IPP" was defined to mean "income for the year (before attribution) less attribution to minorities, adjusted by other changes in reserves 29 Olsson v Dyson (1969) 120 CLR 365 at 389; [1969] HCA 3. 30 Item 10 of the definitions and cl A.1.1 of the IPPA 2005. 31 cl A.1.2 of the IPPA 2005. 32 cl A.1.2 of the IPPA 2005. 33 cll A.3.1 and A.3.2 of the IPPA 2005. 34 cl A.2.1 of the IPPA 2005. 35 Item 1 of the definitions in the IPPA 2005. 36 cl A.2.1 of the IPPA 2005. 37 Item 13 of the definitions in the IPPA 2005. Gordon (before attribution), but excluding movements in asset revaluation or equivalent reserves and cash flow hedge reserves"38. The Net Income for IPP for a particular period was then divided by "the number of PPU allocated and participating during that period to produce the Period Amount"39 (emphasis added). "Periodical IPP" for each allocation of PPU to an employee were aggregated over the period the employee held such PPU from the Allocation Date up to and including the Notice Date40. If, at the Notice Date, the aggregated Periodical IPP was negative, it would be deemed to be zero41. What was then to occur when employment was terminated was addressed in cl A.3.3 of the IPPA 2005, read in conjunction with cl A.2.1. At the Notice Date, only the PPU that had been allocated for more than 24 months vested42. Then, with effect from the Notice Date43: "(a) [Glencore AG] will (i) purchase from GI the GS owned or held by GI with respect to [Mr Blank] or (ii) request that GI change its records as to the GS and reallocate the PPU to a different employee selected under the terms of the Plan, and (b) [Mr Blank] shall execute and remit to GI a declaration of assignment and general release substantially in the form [of an Annexure]." As with the PPA 1999, Mr Blank was to receive 55% of his IPP as profit distribution, which was subject to Swiss withholding tax at a rate of 35%44. Amounts for Swiss withholding tax were to be withheld from each instalment 38 Item 12 of the definitions in the IPPA 2005. 39 cl A.2.3 of the IPPA 2005. 40 cl A.2.4 of the IPPA 2005. 41 cl A.2.5 of the IPPA 2005. 42 cl A.2.1 of the IPPA 2005. 43 cl A.3.3 of the IPPA 2005. 44 cl A.4 and Annex C of the IPPA 2005. 45 cll A.4 and A.9.1 of the IPPA 2005. Gordon The IPP became due on the "Due Date", provided that a declaration of assignment and general release had been executed by Mr Blank and submitted to GI46. "Due Date" was defined to mean the 30th day after the Notice Date47. The IPP was a debt bearing interest, which was to be paid in USD in 20 equal quarterly instalments48. It was acknowledged for "US federal income tax purposes" that payments made pursuant to the IPPA 2005 represented "compensation being paid in consideration of the services to be rendered" by The SA 2005 replaced the SA 199450. The SA 2005 and the IPPA 2005 were "stapled" in that the IPPA 2005 was only effective if Mr Blank had executed the SA 2005 and purchased shares in GH equal to the number of PPU allocated to him under the IPPA 200551. The shares in GH were to be purchased at their par value of CHF 5052. The SA 2005 stated that the "purpose of GH is neither Shareholders"53. Generally, no dividends were payable on the shares in GH54. The shares in GH were not transferable and could not be encumbered without the prior written consent of GH55. The SA 2005 granted cross put and call options for the sale and purchase at par value of the shares in GH on, amongst other events, termination of the shareholder's employment with the relevant Glencore the generation of profits nor the distribution of dividends 46 cl A.5 and Annex C of the IPPA 2005. 47 Item 4 of the definitions in the IPPA 2005. 48 cll A.6 and A.7 of the IPPA 2005. 49 cl A.9.2 of the IPPA 2005. 50 cl E.5 of the SA 2005. 51 cl B.1 of the IPPA 2005. 52 cl A.2 of the SA 2005. 53 cl C.1.3.2 of the SA 2005. 54 cl C.2.3.1 of the SA 2005. 55 cl D.3 of the SA 2005. Gordon entity, redemption of the shareholder's interest in the IPPA 2005 or termination of the SA 2005 or the IPPA 200556. As with the SA 1994, GH undertook in the SA 2005 to provide that GI would meet its obligations under the profit participation plans concluded with shareholders of GH57. Termination of employment and the Declaration On 31 December 2006, Mr Blank's employment with Glencore Australia terminated. On 15 March 2007, Mr Blank executed a Declaration. Clause B provided that Mr Blank, in consideration of USD 160,033,328.25 and CHF 80,000 to be paid by GH: relinquishe[d] his claim to payments with respect to the PPU and GS allocated in his name together with all preferential and ancillary rights to GI; assign[ed] all GS, registered and/or held in his name together with all preferential and ancillary rights to GI, and irrevocably authorize[d] GI to take over the respective certificates; assign[ed] all his shares of GH, registered and/or held in his name together with all preferential and ancillary rights to GH, and irrevocably authorize[d] GH respective certificates." (emphasis added) take over the The Declaration mistakenly deleted elements of the pro-forma declaration contained in the IPPA 2005 and made it appear that the Amount was to be paid by GH when the Amount was in fact to be paid by GI58. Neither party suggested that this error was significant. 56 cll D.4.1 and D.4.2 of the SA 2005. 57 cl C.2.3.1 of the SA 2005. 58 Blank v Federal Commissioner of Taxation (2014) 95 ATR 1 at 19 [39]; see also at Gordon Decisions below The primary judge (Edmonds J) held that the Amount was ordinary income because it was deferred compensation for services rendered by Mr Blank, as recorded in the IPPA 2005. His Honour rejected Mr Blank's contention that the allocation of the GS and the PPU were the reward for services and that the Amount was simply the realisation of the rights attached to the GS and the PPU59. The primary judge also rejected the Commissioner's contentions that, even if the GS could be characterised as assets of Mr Blank (in the form of contractual rights), they were revenue assets and the gain on realisation of them was ordinary income under the second limb of Myer Emporium, and that the Amount was an ETP60. In separate reasons, the primary judge relevantly held that, in relation to the timing question, the first two instalments of the Amount were not derived in the 2007 income year61. On appeal to the Full Court of the Federal Court, Kenny and Robertson JJ held that the Amount was assessable as ordinary income. Their Honours rejected the contention that the rights under the profit participation plans, or the PPU, were themselves a benefit provided in consideration of services to be provided by Mr Blank62. Pagone J, in dissent, held that the combined effect of the IPPA 2005 and the SA 2005 was to confer on Mr Blank "an entitlement like that of a shareholder"63 in the form of an entitlement to GI's profits and that the Amount 59 Blank v Federal Commissioner of Taxation (2014) 95 ATR 1 at 31-32 [94]-[97]. 60 Blank v Federal Commissioner of Taxation (2014) 95 ATR 1 at 31 [93], 34 [105]. 61 Blank v Federal Commissioner of Taxation (No 2) (2014) 98 ATR 379 at 388 62 Blank v Commissioner of Taxation (2015) 329 ALR 213 at 235-236 [84]-[85], 63 Blank v Commissioner of Taxation (2015) 329 ALR 213 at 252 [130]. Gordon was therefore the realisation of those "entitlements" and a gain of a capital nature rather than ordinary income64. The Full Court unanimously agreed with the primary judge on the timing question65. Applicable law The arrangements in issue in this appeal, including Art 657 of the Swiss Code of Obligations and the Articles of GI and Glencore AG, have their foundation in Swiss law. Each profit participation plan was governed by, and to be construed and interpreted in accordance with, the substantive laws of Switzerland66. The parties conducted the matter below and in this Court on the agreed basis that the proper construction of those arrangements was to be determined according to Australian law67. Issues on appeal The primary issue on appeal was the proper characterisation of the receipt of the Amount in Mr Blank's hands – was the Amount ordinary income as a reward for services or, as Mr Blank contended, the proceeds of the exploitation of interconnected rights that conferred on him a right to receive, in the future, a proportion of the profit of GI and therefore assessable as a capital gain? If the Amount was ordinary income then, aside from the question of the Commissioner being granted special leave to cross-appeal on the timing question, the Commissioner's alternative contentions – the applicability of Myer Emporium, whether the Amount was an ETP and, if the Amount was in the nature of a capital gain, how the cost base of the "rights" was to be determined – do not arise for determination. 64 Blank v Commissioner of Taxation (2015) 329 ALR 213 at 258 [138], 260 [142]. 65 Blank v Commissioner of Taxation (2015) 329 ALR 213 at 238 [96], 263 [146]. 66 See cl C.6 of the PPA 1993; cl C.8 of the PPA 1999; cl C.11 of the IPPA 2005. 67 See Neilson v Overseas Projects Corporation of Victoria Ltd (2005) 223 CLR 331 at 343 [16], 370 [116], 372 [125], 411 [249]; [2005] HCA 54. Gordon The question of characterisation of the receipt of the Amount is the issue addressed in the next section. Amount income according to ordinary concepts Principles Section 6-5(1) of the 1997 Act provides that a person's "assessable income includes income according to ordinary concepts, which is called ordinary income" (emphasis in original). "Some things are so obviously income that their nature is unchallengeable"68. One is the reward for services rendered in the form of remuneration or compensation. The characterisation of the reward for services rendered as income is not lost because the reward is paid in a lump sum, because the payment is deferred or because it is payable upon the occurrence of a particular event. An amount paid as a lump sum because a person has retired from an office or employment, or has had their office or employment terminated, is income of that office or employment if it is deferred remuneration69. That proposition was "well established" by 197570; its correctness is not in dispute. The question in this case is one of characterisation. The question is "whether the amount received in a lump sum was part of the consideration for the services rendered in the office or employment"71. If the answer is "yes", it is income according to ordinary concepts even though payment is deferred. In this matter, the answer to that question focuses attention on the 68 Hannan, Principles of Income Taxation, (1946) at 8. 69 Reseck v Federal Commissioner of Taxation (1975) 133 CLR 45 at 56; [1975] HCA 38 citing Henry v Foster (1931) 16 TC 605 and Dewhurst v Hunter (1932) 16 TC 637; see also at 51. 70 Reseck (1975) 133 CLR 45 at 56. 71 Reseck (1975) 133 CLR 45 at 56. Gordon The IPPA 2005 that The terms of the IPPA 2005 expressly stated that the Amount was deferred compensation from Mr Blank's employment with Glencore Australia. The IPPA 2005 recorded the "Plan" means a plan of "deferred compensation" to be known as the "Incentive Profit Participation Plan" for selected employees of the Glencore Group72. The IPPA 2005 described the IPP as "deferred compensation"73. the Plan of "deferred compensation" was "in consideration of the services to be rendered" by Mr Blank to Glencore Australia74. the "Employee". The Amount was paid under the IPPA 2005 when Mr Blank's employment with Glencore Australia ceased75. The Amount was paid as a lump sum as an additional reward to Mr Blank for the services he had performed for the Glencore Group76. Mr Blank was described as Participation Not only was the Amount paid as deferred compensation under the IPPA 2005 when Mr Blank's employment with Glencore Australia ceased, but the right to claim the Amount as deferred compensation did not arise until Mr Blank's employment with Glencore Australia ceased. That last statement requires explanation. In the IPPA 2005, the parties acknowledged that the GS were issued by Glencore AG to GI pursuant to Art 657 of the Swiss Code of Obligations and were issued solely for the purposes of implementing the profit participation plans and to serve as PPU to calculate the amount of deferred compensation77. 72 pars 4 and 5 of the Preamble, Items 10 and 16 of the definitions, cll A.1.1 and A.1.2 of the IPPA 2005. 73 Item 10 of the definitions in the IPPA 2005. 74 pars 4 and 5 of the Preamble to the IPPA 2005. 75 cl A.5 of the IPPA 2005 read with Items 4 and 13 of the definitions in the 76 See Mutual Acceptance Co Ltd v Federal Commissioner of Taxation (1944) 69 CLR 389 at 403; [1944] HCA 34. 77 cll A.1.1 and A.1.2 of the IPPA 2005. Gordon The IPPA 2005 also recorded that Mr Blank had no interest whatsoever in the GS and did not acquire any right in or title to any assets, funds or property of GI, Glencore AG or any other subsidiary78. That provision reflected, and was in accordance with, Art 657 of the Swiss Code of Obligations and the Articles of both GI and Glencore AG, which provided that a GS granted no more than a claim to a cumulative portion of the balance sheet profit, and that the claim was granted not upon the issue or allocation of the GS to the employee but upon restitution of the GS at the time the employment ceased. And then, any such claim was only in respect of those GS issued more than 24 months before employment ceased. Moreover, GI's and Glencore AG's Articles further provided that the holders of GS have no voting rights, no right to call a general meeting of shareholders, no right to attend a shareholders' meeting, no right to information, no right of inspection and no right to move motions79. Next, the terms and structure of the SA 2005 and the IPPA 2005 considered together disclose an intention that the profit of GI and the Glencore Group more generally should be distributed as deferred compensation to employees in that capacity and not as a return on the shares in GH. For example, under the SA 2005, the purpose of GH was expressly stated to be "neither the generation of profits nor the distribution of dividends to Shareholders" and shares in GH generally paid no dividends and were purchased and sold only at par value80. The fact that Mr Blank's entitlement was to be calculated by reference to the profits or "economic success" of GI does not indicate that such an entitlement was "like that of a shareholder"81. What the IPPA 2005 conferred on Mr Blank was an executory and conditional promise to pay an amount calculated by reference to those profits. The fact that GH had agreed in the SA 2005 to procure GI to meet that obligation82 does not affect the character of the promise conferred on Mr Blank. Any analogy with the rights of a shareholder is neither necessary nor appropriate. 78 cl A.1.2 of the IPPA 2005. 79 See Art 8.3 of GI's Articles; Art III of Glencore AG's Articles. 80 cll C.1.3.2, C.2.3.1, D.3, D.4 of the SA 2005. 81 cf Blank v Commissioner of Taxation (2015) 329 ALR 213 at 252 [130]. 82 cl 2.3.1 of the SA 2005. Gordon As the majority of the Full Court correctly concluded, what the IPPA 2005 conferred on Mr Blank was an executory and conditional promise to pay an amount at a future date determined by reference to the PPU allocated to Mr Blank. The fact that the Amount was paid after the termination of the contract of service, by a person other than the employer (here, GI) and separately to ordinary wages, salary or bonuses, does not detract from its characterisation as income if the payment is, as here, a recognised incident of the employment83. "Rights" not analogous to options Mr Blank contended that his "associated rights" under the IPPA 2005 and the SA 2005 – including the GS and the PPU – were analogous to options and were assets of a proprietary nature84. That contention should be rejected. It is contrary to the terms of the IPPA 2005. The IPPA 2005 expressly stated that the PPU were issued solely for the purpose of calculating the IPP and conferred no interest of any kind on Mr Blank. The right to a payment calculated using the PPU crystallised only on termination of Mr Blank's employment. The Amount was not the proceeds of the exploitation of any anterior set of rights but was the performance of the promise to pay money made in the IPPA 2005 on satisfaction of the conditions on which that performance depended. Any "rights" Mr Blank had were "merely executory" and were neither vested nor accrued85. The fact that the IPPA 2005 and the SA 2005 were "stapled" does not detract from that characterisation. Contrary to the contention of Mr Blank, the rights created by the IPPA 2005 are not mere "associated rights" of the shares in GH, held by Mr Blank in his capacity as shareholder of GH. That contention is contrary to the express terms and purpose of the IPPA 2005. Mr Blank's right to payment after the termination of his employment stands in stark contrast with the rights attached to the options considered in 83 Federal Commissioner of Taxation v Dixon (1952) 86 CLR 540 at 556; [1952] HCA 65. 84 cf Abbott v Philbin [1961] AC 352; Donaldson v Commissioner of Taxation (Cth) [1974] 1 NSWLR 627; Federal Commissioner of Taxation v McArdle (1988) 19 ATR 1901; Federal Commissioner of Taxation v McNeil (2007) 229 CLR 656; [2007] HCA 5. 85 cf McNeil (2007) 229 CLR 656 at 665 [27]. Gordon Abbott v Philbin86. In that case, an employee (the company secretary) was granted an option to purchase shares in the company with the exercise price set when the option was granted. The options were non-transferable and were to expire on the earliest of 10 years from grant, the employee's retirement or his death. The grant of the option itself was held to be the relevant reward for service. The employee's gain – being the difference in value between the market price and the exercise price – was not assessable as ordinary income. In stark contrast with Mr Blank's "rights", immediately upon the grant of the option, the employee's rights in Abbott were unconditional, they could be exercised at any time in that year of income without any further act of the grantor, and their value could readily be ascertained by comparing the share price from time to time with the exercise price87. The non-proprietary nature of the "associated rights" is further evidenced by the fact that under the IPPA 2005, GS and the earlier iterations of GS that had been issued under earlier profit participation agreements would "serve as the PPU"88 under the IPPA 2005. The Amount, to which Mr Blank became entitled on termination, was an amount calculated by reference to all of the PPU recognised by the IPPA 2005, including the 100 that were never issued as GS89. As a result, the Amount was the amount to which Mr Blank was contractually entitled under the IPPA 2005, being an amount calculated by reference to all 1,600 of the PPU identified in the IPPA 2005, regardless of whether they were previously issued as GS. The Amount was not and could not be characterised as the proceeds of disposal of GS, or any other "bundles of rights". Accordingly, for Mr Blank, a receipts-based taxpayer, there was no derivation of any income as a result of the "rights" granted under the IPPA 2005 or any of the earlier agreements90. The receipt of the Amount by Mr Blank, as a receipts-based taxpayer, was income according to ordinary concepts on receipt and part of Mr Blank's assessable income. There was no earlier point when it 87 See Abbott [1961] AC 352 at 371. 88 cl A.3.1 of the IPPA 2005. 89 See [29] and [31] above. 90 cf Parsons, Income Taxation in Australia, (1985) at 28-29 [2.15]-[2.16]; Tagget v Federal Commissioner of Taxation (2010) 188 FCR 128 at 138 [31]. Gordon could be said that Mr Blank had actual or constructive receipt of the Amount, or any part of it91. "Associated rights" could not be turned to pecuniary account The conclusion that there was no derivation of any income by Mr Blank as a result of the "associated rights" is fortified by the fact that none of these so-called "associated rights" could be turned to pecuniary account. Unlike the options in Abbott92, which could have been exercised at any time and the purchased shares immediately sold, the "associated rights" in issue in this appeal were (subject to one exception) unable to be dealt with by Mr Blank until the Notice Date. The rights and claims and GS issued under the various versions of the profit participation plans could not be transferred or alienated or subject to any grant of an interest93. The exception was that Mr Blank was able, under each profit participation plan (other than the PPA 1993), to seek an assignment to a personal holding company, trust or foundation that he controlled provided that GI consented. That ability to seek an assignment did not bring home the value of the "associated rights" to Mr Blank prior to the Notice Date. As the majority of the Full Court properly concluded, if and to the extent that occurred, it would involve no more than Mr Blank assigning his claims to payment under the IPPA 2005 to an entity that was already under his complete control94. GS and PPU not otherwise assessable Next, it is necessary to address Mr Blank's contention that the GS and PPU were assessable either as ordinary income or under s 26(e) of the 1936 Act (or s 15-2 of the 1997 Act) and that Mr Blank was therefore at risk of double taxation. That contention should be rejected. The contention ignores that the proper characterisation of Mr Blank's rights under the IPPA 2005 was an executory and conditional promise to pay money. Second, it is contrary to the terms and purpose of s 26(e) of the 1936 Act and would lead to absurd results. The purpose of s 26(e) was to ensure that 91 Tagget (2010) 188 FCR 128 at 138-139 [31]-[33]. 92 [1961] AC 352 at 366, 371-372, 377-379. 93 cl C.2 of the PPA 1993; cl C.2 of the IPPA 2003; cl C.2 of the IPPA 2005. 94 Blank v Commissioner of Taxation (2015) 329 ALR 213 at 237 [89]. Gordon receipts and advantages which are in truth rewards for a taxpayer's employment or services are treated as assessable income even if they are not paid fully in money, but by way of allowances or advantages that have a money value for the taxpayer95. That is not the position under the IPPA 2005. Moreover, if Mr Blank's contention was correct and the value of executory and conditional promises to pay money in respect of, or for, or in relation directly or indirectly to, employment or services rendered were assessable under s 26(e) of the 1936 Act, every employee would be rendered an accruals-based taxpayer taxable on their wages and salary before they received it. Such a conclusion cannot be, and is not, correct. Declaration Finally, it is necessary to address the Declaration. As the primary judge observed96, the consideration of CHF 80,000 referred to in cl B of the Declaration was the price for Mr Blank's 1,600 shares paid by GH at a par value of CHF 50 per share, which were then assigned under par (c) of cl B of the Declaration. The consideration of the Amount referred to in cl B was paid by GI in satisfaction of the rights under the IPPA 2005 as determined by the PPU allocated to Mr Blank and was referable to pars (a) and (b) in cl B. The amounts in cl B cannot be regarded as constituting a global consideration for the sale of shares and the satisfaction of the rights under the IPPA 2005. That construction is contrary to the express terms of the Declaration and the express terms of the IPPA 2005, which is referred to in the Declaration. Paragraphs (a) and (b) in cl B of the Declaration record that the Amount was accepted on receipt in full satisfaction of the rights under the IPPA 2005 and not as attempting to confer on the GS and PPU a proprietary character they did not otherwise possess. Conclusion For those reasons, the appeal should be dismissed. The Amount was ordinary income of Mr Blank. It was deferred compensation for services Mr Blank rendered as an employee and therefore, on receipt, formed part of his assessable income pursuant to s 6-5 of the 1997 Act. 95 Scott v Federal Commissioner of Taxation (1966) 117 CLR 514 at 525-526; [1966] HCA 48. 96 Blank v Federal Commissioner of Taxation (2014) 95 ATR 1 at 19 [39]. Gordon Other appeal grounds, cross-appeal and notice of contention It is unnecessary to consider the other appeal grounds or the notice of contention filed by the Commissioner as the conclusion reached above means the issues raised by those grounds and contentions do not arise. It is, however, necessary to consider ground 2(b) of the Commissioner's application for special leave to cross-appeal, which deals with the timing question. The balance of the application for special leave to cross-appeal does not arise and should be dismissed with costs. Timing question The Commissioner sought special leave to cross-appeal against the primary judge's and the Full Court's rejection of his contention that two instalments of the Amount due in the 2007 income year had been derived by Mr Blank in that year because they had been "applied or dealt with" on his behalf or as he directed, within the meaning of s 6-5(4) of the 1997 Act. That application should be dismissed with costs. Section 6-5(4) of the 1997 Act provides that "[i]n working out whether you have derived an amount of *ordinary income, and (if so) when you derived it, you are taken to have received the amount as soon as it is applied or dealt with in any way on your behalf or as you direct" (emphasis in original). The object of s 6-5(4) is to prevent a taxpayer escaping the imposition of tax where, although income has not actually been paid to him or her, his or her resources have actually been increased "by the accrual of the income and its transformation into some form of capital wealth or its utilization for some purpose"97. As we have seen, Mr Blank was a receipts-based taxpayer. Under the IPPA 2005, GI was obliged to pay Mr Blank the Amount in 20 equal instalments, payable at the end of each quarter, with the first payment due in January 2007. The issue of derivation under s 6-5(4) arose because, although under the express provisions of the IPPA 2005 two instalments of the Amount were 97 Brent v Federal Commissioner of Taxation (1971) 125 CLR 418 at 430; [1971] HCA 48 quoting Permanent Trustee Company of New South Wales Ltd v Federal Commissioner of Taxation (1940) 2 AITR 109 at 110-111. Gordon payable to Mr Blank in the 2007 income year, Mr Blank did not receive those instalments in that income year. Therefore, the two instalments (or a part of them) could only have been derived by him in the 2007 income year by reason of The primary judge made a finding, upheld on appeal, that the agreement to vary the payment terms, so that the first two instalments of the Amount were not paid in the 2007 income year, was not entered into until 24 January 200898. That finding referred to a letter sent to Mr Blank dated 24 January 2008, which enclosed a copy of an agreement between GI and Mr Blank ("the January 2008 Agreement"). That agreement recorded that although under the IPPA 2005 GI had agreed to pay the Amount in 20 quarterly instalments with the first instalment payable on 31 January 2007, GI and Mr Blank had reached agreement to alter the payment terms. Under the altered payment terms, the first instalment of USD 32,006,565.65 would be due on 31 December 2007 and GI would withhold from that amount USD 30,806,415.70 and pay that amount to the Swiss FTA. In short, whereas under the IPPA 2005 GI was to withhold part of each instalment for withholding tax, the January 2008 Agreement recorded an agreement with the Swiss FTA to settle the whole withholding tax bill in advance99. That was an alteration to the terms of the IPPA 2005. On appeal to this Court, the Commissioner submitted that that agreement was reached not in January 2008 but prior to 17 March 2007 and that therefore, during the 2007 income year, at least the instalments due in that year had been "applied or dealt with" on Mr Blank's behalf or as he directed within the meaning of s 6-5(4) of the 1997 Act. That contention was based on the fact that Mr Blank had provided affidavit evidence that on or about 17 March 2007 he was provided with a letter by GI, which summarised his entitlements under the IPPA 2005. That document recorded, in summary form, the payment arrangements included in the January 2008 Agreement. Neither the primary judge nor the Full Court found as a fact that the GI letter received by Mr Blank on or about 17 March 2007 reflected an oral agreement made in the 2007 year of income to the same effect as the January 2008 Agreement. Such a finding would have been inconsistent with Mr Blank's evidence that it was the January 2008 Agreement 98 Blank v Federal Commissioner of Taxation (No 2) (2014) 98 ATR 379 at 388 [44]-[45]; Blank v Commissioner of Taxation (2015) 329 ALR 213 at 238 [95]. 99 cl 2 of the January 2008 Agreement. Gordon which established his instructions to GI as to how the first two instalments were to be applied, evidence in relation to which he was not cross-examined. It was a question of fact when the agreement addressing the altered payment arrangements was entered into. The finding that the agreement was not made until January 2008 was a factual finding made by the primary judge and upheld on appeal. No question of principle of general application is raised by the Commissioner's application for special leave to cross-appeal. The application for special leave to cross-appeal on ground 2(b) should be dismissed with costs. Conclusion and orders The appeal should be dismissed with costs. The Commissioner's application for special leave to cross-appeal should be dismissed with costs.
HIGH COURT OF AUSTRALIA AILEEN ROY AND APPELLANT RESPONDENT [2020] HCA 45 Date of Hearing: 8 September 2020 Date of Judgment: 9 December 2020 ORDER Appeal dismissed. On appeal from the Supreme Court of the Northern Territory Representation P R Boulten SC with P D Coleridge for the appellant (instructed by North Australian Aboriginal Justice Agency) J T Gleeson SC with T J Moses for the respondent (instructed by Director of Public Prosecutions (NT)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Evidence – Admissibility – Trespass – Where appellant charged with breach of Domestic Violence Order ("DVO") – Where DVO included condition that appellant not remain in her partner's presence while intoxicated – Where police attended unit occupied by appellant and her partner for purpose of DVO check – Where police engaged in wider proactive policing operation – Where police knocked on front door and asked appellant to come to door for DVO check – Where police observed signs of intoxication and requested appellant submit to breath test – Where breath test positive for alcohol – Whether evidence of breath test lawfully obtained – Whether police trespassed – Whether common law implied licence permitted police to approach unit and knock – Whether lawful purpose to attend unit. Words and phrases – "breath test", "coercive powers", "common law implied licence", "Domestic Violence Order", "implied licence to enter private property", "interference with an occupier's possession", "lawful communication with an occupier", "lawful purpose", "police", "proactive policing", "trespass". Police Administration Act (NT), s 126(2A). Domestic and Family Violence Regulations (NT), reg 6. KIEFEL CJ. In June 2017 a Domestic Violence Order (a "DVO") issued out of the Local Court of the Northern Territory of Australia at Katherine against the appellant. Its evident purpose was to protect the appellant's partner, Mr Johnson, from her in circumstances where she had consumed alcohol or another intoxicating drug or substance. In relevant part it restrained the appellant from being in the company of Mr Johnson or at a place where he lived when she was consuming alcohol or was under its influence. In proceedings brought for breach of the DVO1, evidence of the results of a breath test, which showed that the appellant had consumed alcohol, was excluded from admission into evidence on the ground that it was obtained unlawfully. It was held to have been obtained unlawfully because the police officer who administered the breath test was found to have no authority to be present on the premises, which is to say he was a trespasser. The appellant was found not guilty of the charge. At the time of the visit by the police officer, Constable Elliott, and two other officers to the dwelling unit where the appellant and Mr Johnson resided, the police in the Northern Territory were engaged in a wider operation which targeted domestic violence. This was referred to as "proactive policing", which may be understood to be directed to preventing such violence rather than dealing with it after it had occurred. In his evidence at the hearing of the charge in the Local Court, Constable Elliott said that prior to the visit he had concerns that Mr Johnson's welfare could be compromised when the appellant was intoxicated. The appellant had stabbed Mr Johnson on a previous occasion. There had been a number of incidents involving other behaviour on the part of the appellant which he considered could adversely affect Mr Johnson. Two weeks prior to the visit in question Constable Elliott had taken the appellant to a "sobering up shelter". He said that he believed that she would be intoxicated when he visited the premises on the occasion here in question, because she invariably was. The dwelling unit in which the appellant and Mr Johnson lived was part of a public housing complex. The police officers entered the yard from the footpath and walked along one of the pathways shared by the units to the entrance to the dwelling unit. Constable Elliott knocked on the flyscreen door, looked in and saw Mr Johnson seated on a couch and the appellant lying on the floor. He called the appellant to the door for the purpose of a DVO check. As she approached, he observed indicia of intoxication. He required her to provide a sample of her breath to test and she complied. The machine he used gave a positive reading for alcohol. When asked at the hearing of the charge what power he was exercising, Constable Elliott gave as his answer, reg 6 of the Domestic and Family Violence Regulations 1 Domestic and Family Violence Act (NT), s 120(1). Regulation 6 requires a defendant to comply with a reasonable direction by a police officer to submit to a breath test to assess whether the defendant may have had alcohol in his or her breath. For the direction to be reasonable, it is not necessary that the officer have a suspicion that the defendant has consumed alcohol. But it does not in terms authorise entry onto premises for that purpose. Section 126(2A) of the Police Administration Act (NT) does authorise entry onto premises. It provides that a member of the Police Force of the Northern Territory may "enter a place" if he or she believes on reasonable grounds that a contravention of a DVO made under the Domestic and Family Violence Act (NT) has occurred, is occurring or is about to occur at the place. It authorises the police officer to remain at the place and take such reasonable actions as are considered necessary. The decisions below The trial judge, Judge Woodcock, held that neither provision gave the police power to attend at the premises to check the appellant's compliance with the DVO. So far as concerned s 126(2A), his Honour found that Constable Elliott did not have the requisite belief and that the appellant was merely a "person of interest" to him. It is to be inferred that his Honour took the view that when he entered the premises Constable Elliott could not have a belief, on reasonable grounds, that the appellant had consumed alcohol and thereby breached the DVO, rather he was ascertaining whether that was the case. This was also the view of Mildren A-J on the appeal to the Supreme Court of the Northern Territory2. His Honour found that the requisite belief arose only when Constable Elliott observed the appellant coming to and opening the door of the dwelling unit. Up until that time, his Honour said, the police officer could not suspect, reasonably or otherwise, that the appellant had consumed alcohol. The statutory authority of s 126(2A) therefore could not have been invoked when Constable Elliott and the other police officers arrived at the door from the footpath. Mildren A-J then considered whether the implied permission, which the common law attributes to an occupier, for persons to enter the premises for lawful purposes applied. His Honour held that it could not arise where the purpose is to investigate whether a breach of the law has occurred or to gather evidence of a crime committed by the occupier3. His Honour rejected the argument that a purpose of Constable Elliott was to conduct a check on the welfare of Mr Johnson. 2 O'Neill v Roy (2019) 345 FLR 8. 3 O'Neill v Roy (2019) 345 FLR 8 at 26 [44]. The Court of Appeal of the Northern Territory (Southwood and Kelly JJ and Riley A-J)4 overturned the latter finding. The Court held that Constable Elliott had a dual purpose in entering the premises – to determine whether the terms of the DVO were being honoured and to check on the wellbeing of the protected person, Mr Johnson. It was sufficient for the permission which the common law implies that the officer had the latter, lawful, purpose. The implied licence and its limits It is well understood that the law of trespass requires that for a person lawfully to enter private premises there must be an invitation or permission from the occupier respecting that entry. The common law also recognises that such a rule would be unworkable in our society if it were strictly applied so as to render all visitors who did not have an express permission from the occupier, trespassers. It recognises that it is in the interests of the occupier, entrants and society more generally that there be a qualification to the law of trespass. It effects that qualification by implying a permission, on the part of an occupier, for persons to enter upon premises and approach a dwelling to engage in lawful purposes. It balances its recognition of that implied permission by acknowledging that an occupier may negate the permission, by sufficiently indicating that entry is not permitted, and that an occupier may revoke the permission at any time, by requiring the visitor to leave the premises. The implied licence applies to members of the public and the police alike, albeit that the business which they may have with the occupier or those present on the premises may differ. The most common such licence, a majority of this Court in Halliday v Nevill5 observed, relates to the means of access, usually by path or driveway, to a suburban house. If access is unobstructed, the entrance gate unlocked and there is no notice or other indication that entry by visitors is prohibited, "the law will imply a licence in favour of any member of the public to go upon the path or driveway to the entrance of the dwelling for the purpose of lawful communication with, or delivery to, any person in the house". If the implied licence is revoked at any time, the visitor becomes a trespasser if they remain. Although a purpose of speaking with the occupier or another person present at the premises is the most common lawful purpose in entering residential premises, it is not the only category of purpose that will qualify for the law to imply a licence. In Halliday v Nevill6 it was explained more generally that the path or driveway of premises is held out by the occupier "as the bridge between the public 4 O'Neill v Roy (2019) 345 FLR 29 at 39 [37]. (1984) 155 CLR 1 at 6-7. (1984) 155 CLR 1 at 7-8. thoroughfare and his or her private dwelling upon which a passer-by may go for a legitimate purpose that in itself involves no interference with the occupier's possession nor injury to the occupier, his or her guests or his, her or their property" (emphasis added). These factors may be understood to provide the limits of the licence to enter which the law will imply. They are consonant with the law of trespass, to which the implied licence effects a qualification. An approach which requires that the purpose both be legitimate and involve no interference with possession or injury to those present is comprehensible and workable. It requires no fine distinctions to be drawn, unguided, as to what are permissible or impermissible purposes; rather one looks to the effects of the purpose carried out upon the occupier's rights and its impact on those present. The circumstances in Halliday v Nevill7 provide an example. The purpose of the police in entering upon the driveway of the dwelling in question was not to communicate with the occupier or other persons lawfully there present. The police had no business with such persons. Their purpose was to arrest without warrant a person known to be a disqualified driver who took refuge in the driveway. Clearly the entry of the police to effect that purpose involved no interference with the occupier's possession or injury to the occupier or others on the property. The conclusion reached by the majority, that the police officer was not a trespasser, was said to be based on common sense, reinforced by considerations of public policy8. In Robson v Hallett9, which was referred to with approval in Halliday v Nevill10, police officers had received information concerning a possible offence which had taken place that evening. They went to and entered upon residential premises through the gate and to the front door in order to make enquiries of the occupants in relation to it. Lord Parker CJ held that the police officers entered the premises under a lawful licence11. The purpose of the police in entering the premises to undertake the business of police by making enquiries12 may also be (1984) 155 CLR 1. (1984) 155 CLR 1 at 8. [1967] 2 QB 939; see also Florida v Jardines (2013) 569 US 1 at 9. (1984) 155 CLR 1 at 7. 11 Robson v Hallett [1967] 2 QB 939 at 952-953, Diplock LJ and Ashworth J agreeing. 12 See Robson v Hallett [1967] 2 QB 939 at 952 per Lord Parker CJ. understood, in accordance with Halliday v Nevill, not to involve an interference with the occupier's possession or injury to any person present. "Injury" is a broader concept in the law of trespass than in some other torts. It may include an affront to a person's dignity or apprehension of harm. Injury of this kind may be caused, for example, as a result of an unauthorised and therefore unlawful search of a person's dwelling and seizure of the person's property13. The use of other coercive powers might likewise involve injury in this wider sense. The prospect that a person might be investigated for an offence is not injury of this kind14. Clearly it would be an interference with an occupier's possession if police entered for the purpose only of searching the premises15. Consistently with what was said in Halliday v Nevill, the common law will not imply a licence to enter for that purpose. To enter lawfully, police must have a valid warrant issued under a statute which provides that authorisation in order to justify what would otherwise be a trespass16. Likewise, if a police officer was to enter premises for the sole purpose of exercising coercive powers, such as requiring a person to submit to a breath test, a statutory power such as s 126(2A) of the Police Administration Act would be necessary and the police officer must have the required belief as to contravention. The present case Applied to the facts of the present case, the approach of the majority in Halliday v Nevill readily admits of a conclusion that a licence would be implied. It is implied by the law so that police might undertake such enquiries and observations of the appellant as were necessary if she was present at the dwelling unit, to ascertain whether the DVO had been breached and an offence committed, as Constable Elliott expected might be the case. Whether this be called a "check" or an investigation does not matter. It is a non-coercive aspect of police business which involves no adverse effect upon any person and nothing which might qualify as "injury" in the extended sense referred to above. It involves no interference with the occupants' possession. It is difficult to imagine how police could go about their 13 Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 524 [73] per Kiefel CJ, Bell and Keane JJ; 376 ALR 575 at 593. 14 Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 524 [73] per Kiefel CJ, Bell and Keane JJ; 376 ALR 575 at 593. 15 Florida v Jardines (2013) 569 US 1 at 9. 16 See Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 523 [67] per Kiefel CJ, Bell and Keane JJ; 376 ALR 575 at 592. business and more particularly how they could be expected to prevent domestic violence in the public interest unless they were able to make such enquiries and observations of the subject of a DVO and the person it is intended to protect. It follows that when Constable Elliott entered the premises he was not a trespasser. There was nothing to indicate entry was not permitted. His purpose in making enquiries and observing the appellant and Mr Johnson was legitimate and those actions had no adverse consequences. When he ascertained that the appellant was there and observed her state of intoxication he had the requisite belief for the purposes of s 126(2A) of the Police Administration Act, as Mildren A-J found. He was then authorised to remain on the premises and to require a sample of the appellant's breath pursuant to reg 6 of the Domestic and Family Violence Regulations. The Court of Appeal was correct to hold that Constable Elliott had another purpose when he entered the premises of the dwelling unit. That purpose was to ascertain whether Mr Johnson's welfare was being compromised. This was undoubtedly a purpose of Constable Elliott according to his unchallenged evidence, which was generally accepted by the trial judge, who regarded the police officer as an honest witness and not prone to exaggeration about his state of mind. The two purposes – to observe and enquire of the appellant and Mr Johnson – go hand in hand. But this is not to negate that the purpose respecting Mr Johnson is itself a lawful purpose for the implied licence. Constable Elliott's expectation that the appellant might be intoxicated in the company of Mr Johnson might have been the cause for his concern about Mr Johnson, but he had a dual purpose in attending at the dwelling unit. He was checking on both of them. Evidence relating to purpose The appellant's argument denies these purposes. It is her contention that Constable Elliott's purpose in attending at the dwelling unit was to use the coercive powers under reg 6 to obtain a sample of the appellant's breath for testing. It is to be inferred that the appellant contends Constable Elliott intended to do so when he first entered the premises, regardless of how she presented when he came to the door of the dwelling unit. No finding to this effect was made by the trial judge or by Mildren A-J. True it is that the Court of Appeal's reasons contain a statement that Constable Elliott "was intending to obtain a sample of the [appellant's] breath for analysis"17. This statement does not accurately reflect the evidence and should be understood, in the wider context of the reasons, to refer to an intention to require a breath test if the appellant's condition made that necessary. 17 O'Neill v Roy (2019) 345 FLR 29 at 31 [3]. It will be recalled that Constable Elliott's evidence was that it was his experience that the appellant was invariably intoxicated. Arguably this was a sufficient basis for a belief that a contravention of the DVO would be occurring when he entered the premises. Had that view of his evidence been taken, s 126(2A) would have authorised his entry and the requirement for a breath test. But the trial judge did not accept that the police officer had a sufficient basis for that belief and, on appeal, Mildren A-J found that he could only have had a suspicion after the appellant went to and opened the door. That finding was not challenged. It was in connection with the powers provided by s 126(2A) and reg 6 that counsel for the appellant submitted to the trial judge that it was unclear what specific purpose the police officers had in mind when they went to the dwelling unit or what power was being exercised by them. The submission was understandable not the least because the appellant's counsel had not put any questions to Constable Elliott on those topics. The findings referred to above did not affect the evidence of Constable Elliott that he expected the appellant to be intoxicated when he arrived. The question which then arises is whether it may be inferred that he intended to require her to undertake a breath test regardless of her condition when he first observed or spoke to her. Constable Elliott did not say that he knocked on the door and called out to the appellant to come to him for the purpose of a breath test. He said that he called her to the door for the purposes of a DVO check. He explained in his evidence that "part of her conditions was to provide a breath test upon request", but he did not suggest that he said this to the appellant before she came to the door. Clearly enough he was explaining this aspect of the DVO for the court. He said that it was when the appellant approached him for that "check" that he observed indicia of intoxication and required a breath test. A conclusion that he intended to require a test, rather than first observe and speak to her as he in fact did, is not supported by this evidence. There was no direct evidence from Constable Elliott that he intended to require a breath test when he entered the premises and regardless of the appellant's evident condition. Importantly, the appellant's counsel did not suggest to the police officer that he had such an intention. It was merely put to him and to the other police officer who gave evidence that the reason they attended was to conduct a proactive domestic violence check, without explaining what counsel meant to convey by the word "check" and without enquiring of the police officers what they meant by it in giving their evidence. One available meaning was to ascertain the state of the appellant and Mr Johnson and then take whatever action was necessary, which is at least consistent with what occurred. The evidence concerning Constable Elliott's intention does not warrant the inference the appellant seeks to draw. Conclusion and orders Either of the two lawful purposes referred to above was sufficient for the law to imply a licence for Constable Elliott to enter the dwelling unit in question. He was not a trespasser. The evidence of the results of the breath test was admissible. The appeal should be dismissed. Bell BELL AND GAGELER JJ. In the Australian way of thinking, a home is a sanctuary. This sentiment is reflected in common expectations and common practices: "the habits of the country"18. Those habits are founded on an ingrained conception of the relationship between the citizen and the state that is rooted in the tradition of the common law. The conception can be traced to the Jacobean resolution of the Court of King's Bench that "the house of every one is to him as his castle ... as for his repose"19. Nobody, and especially no officer of the state, can enter my home, or even walk up my path or stand at my doorstep or knock on my door, without my permission unless positively authorised by statute or the common law to take that action20. But, of course, the very fact that I have a path and a doorstep, and a door, implies that I am granting permission for anyone who means me no harm to walk up the path, to stand at the doorstep and to knock on the door so as to talk to me if I am home and if I choose to answer the knock21. That generally implied licence − to "knock and talk"22 − applies as much to an officer of the state as it does to my neighbour or to a door to door salesman. Invocation of the licence by uninvited visitors to my home does not depend on the intended subject matter of their communication with me or on whether their communication might or might not be expected to be welcomed by me23. The implied licence is therefore available to be invoked by a police officer to walk up my path, stand at my doorstep and knock on my door, and then to continue to stand at my doorstep and talk to me at my door if I am home and if I choose to answer the knock. The police officer can do all of that in the context of 18 McKee v Gratz (1922) 260 US 127 at 136. 19 Semayne's Case (1604) 5 Co Rep 91a at 91b [77 ER 194 at 195]. 20 Halliday v Nevill (1984) 155 CLR 1 at 7-8, 19; Plenty v Dillon (1991) 171 CLR 635 at 639, 647; Coco v The Queen (1994) 179 CLR 427 at 435-436; Kuru v New South Wales (2008) 236 CLR 1 at 15 [43], [45]. 21 Lipman v Clendinnen (1932) 46 CLR 550 at 557; Halliday v Nevill (1984) 155 CLR 22 cf Florida v Jardines (2013) 569 US 1 at 21. 23 Lipman v Clendinnen (1932) 46 CLR 550 at 559. Bell investigating a crime, even if I am a suspect24. The licence implied from the fact that I have a path and a doorstep and a door in that respect has not been understood in Australia quite so narrowly as in Canada, where it has been said that "occupiers of a dwelling cannot be presumed to invite the police (or anyone else) to approach their home for the purpose of substantiating a criminal charge against them"25. The police officer can ask me any questions he or she wants to ask while standing at my doorstep. I have a choice to answer or not answer. What is more, the implied licence that the police officer has to stand at my doorstep and talk to me is immediately revoked if I choose at any time to say, "go away", following which the police officer will become a trespasser if the police officer does not leave within a reasonable time26. On top of all that, I can negative the implication of the licence in the first place if I contact the police station in advance to say that I do not want police officers to come to my home or if I hang a sign on my gate or my door saying, "Police Not Welcome". But the licence to "knock and talk" implied from the fact that I have a path and a doorstep and a door is surely not a licence to compel me to do anything. The habits of our country do not condone my own coercion in my own home. The carefully crafted and jealously maintained statutory and common law rules authorising search and seizure27 and service and execution of civil and criminal process28 would count for little if they did. If you want to walk up my path and stand at my doorstep and knock on my door so that you can order me to do something, and you do not have my express permission to come to my home, then you need to be specifically authorised by statute or the common law not just to give me the order but also to enter upon my land to give me that order. The implied licence to "knock and talk" is accordingly confined by reference to the "purpose" of the visit, in the sense that the status of an uninvited visitor as either a licensee or a trespasser depends on what the visitor is seeking to 24 Robson v Hallett [1967] 2 QB 939, cited in Halliday v Nevill (1984) 155 CLR 1 at 7, 19, and in Plenty v Dillon (1991) 171 CLR 635 at 647. See also Pitt v Baxter (2007) 34 WAR 102 at 103-105 [3]-[8]; R v Daka [2019] SASCFC 80 at [73]-[77]. 25 R v Evans [1996] 1 SCR 8 at 19 [16]. See also R v Le (2019) 434 DLR (4th) 631 at 26 Cowell v Rosehill Racecourse Co Ltd (1937) 56 CLR 605 at 631. 27 eg George v Rockett (1990) 170 CLR 104 at 110-111. 28 eg Plenty v Dillon (1991) 171 CLR 635 at 639-645. Bell achieve at my home by walking up my path, standing at my doorstep and knocking on my door. If the purpose is just to talk to me, and in talking simply to ask for permission to come inside or to go elsewhere on my land or simply to ask for my voluntary cooperation in pursuing some inquiry, the totality of the conduct is within the scope of the licence. If the purpose is just to coerce me, the totality of the conduct is outside the scope of the licence; it is a trespass. What then if the purpose is both to talk and to coerce? Or what if the purpose is first to talk and then perhaps to coerce if cooperation is not forthcoming? The application of the implied licence to the conduct of police officers would lose touch with the informing conception of the relationship between the citizen and the state were the scope of the implied licence to become entangled in subtle notions of "mixed" or "contingent" purposes29. The lawfulness of the conduct of police officers in a context such as this should not "depend upon fine shades of meaning of words or nice distinctions"30. A passage in the reasoning of Brennan and Deane JJ in Barker v The Queen31 is instructive. In the context of examining whether entry of a thief onto his neighbour's land was authorised by an express licence granted by the neighbour asking him "to look after the place" whilst the neighbour was away on a holiday, their Honours said: "[E]ntry will be as a trespasser if, as a matter of substance and fact, the entry in question is beyond the scope of the permission. ... The answer to the question is not complicated by artificial notions that a permission must be qualified by reference to authorized purpose or by artificial doctrines of relation back. When the only suggested justification for entry is the permission of the person in possession, the question whether entry was as a trespasser involves no more than identification of the limits of the actual permission, the definition of the actual entry and the determination of whether that entry was within the scope of that permission. If the permission was not subject to any express or implied limitation which excluded the entry from its scope, the entry was not as a trespasser. If the permission was 29 cf Inglis Electrix Pty Ltd v Healing (Sales) Pty Ltd (1967) 69 SR (NSW) 311 at 321, 332-333; Healing (Sales) Pty Ltd v Inglis Electrix Pty Ltd (1968) 121 CLR 584 at 599, 606; Barker v The Queen (1983) 153 CLR 338 at 346-347. 30 Lippl v Haines (1989) 18 NSWLR 620 at 623. (1983) 153 CLR 338 at 364-365. See also TCN Channel Nine Pty Ltd v Anning (2002) 54 NSWLR 333 at 341 [29]. Bell subject to an actual express or implied limitation which excluded the actual entry, the entry was as a trespasser." By parity of reasoning, the answer lies in identifying the limits of the permission granted by the implied licence to "knock and talk". The preferable view is that a police officer who walks up my path, stands at my doorstep and knocks on my door exceeds the limits of the permission granted by the implied licence, and is therefore a trespasser, if the police officer has any conditional or unconditional intention of ordering me to do anything. That view is preferable because it is clear and workable and because it is consonant with contemporary community expectations. At this stage in the development of the common law of Australia, it is an appropriate resolution of the "contest between public authority and the security of private dwellings"32. Section 126(2A) of the Police Administration Act (NT) empowers a member of the Northern Territory Police Force to "enter a place" if the member believes on reasonable grounds that a contravention of a Domestic Violence Order ("DVO") made under the Domestic and Family Violence Act (NT) has occurred, is occurring or is about to occur at the place. The provision goes on to authorise the member to remain at the place for such period, and take such reasonable actions, as the member considers necessary, amongst other things, to verify the grounds of the member's belief and to prevent a contravention of the DVO. Senior Sergeant Evans and Constables Elliott and Dowie did not seek to invoke that provision when they turned up in the alcove of the unit occupied by Ms Roy and Mr Johnson at their housing complex in Katherine and spoke to Ms Roy through the fly-screen door. They were engaged instead in an exercise of "proactive [DVO] compliance check[ing]"33. Ms Roy, against whom a DVO had been made, was not a "suspect" but a "person of interest". Mr Johnson, for whose protection the DVO had been made, was also a person for whose welfare they were concerned. Had they turned up merely with the intention of asking Mr Johnson if he was okay, or even of talking exclusively with a view to forming an opinion as to whether Ms Roy was complying with the DVO, they would not have exceeded the implied licence which the existence of the alcove gave to anyone who wished to talk to the occupant of the unit. They would have been just talking. 32 Kuru v New South Wales (2008) 236 CLR 1 at 15 [45], quoting Halliday v Nevill (1984) 155 CLR 1 at 9. 33 O'Neill v Roy (2019) 345 FLR 29 at 30 [1]. Bell The problem is that Constable Elliott turned up intending to obtain a sample of Ms Roy's breath for alcohol analysis34. To obtain that sample, he intended to, and did, use the power of direction conferred on him as a member of the Police Force by reg 6 of the Domestic and Family Violence Regulations (NT). However politely Constable Elliott might have intended to couch the direction he gave to Ms Roy, he knew that Ms Roy would have no option but to comply had the direction been lawful. She would be criminally liable if she did not. That coercive purpose took Constable Elliott and his colleagues beyond the scope of the implied licence; it made them trespassers. The fact that Constable Elliott and his colleagues had the more general "dual purpose" of checking on Ms Roy's compliance with the DVO and checking on the well-being of Mr Johnson35 makes no difference. The fact, if it be the fact, that the coercive purpose might have been contingent on Ms Roy being home and appearing to be drunk can also make no difference. That Ms Roy chose to comply with the request for a breath test is similarly of no moment. Where criminal consequences flow from a failure to comply, the giving of a direction is clearly coercive. If Constable Elliott and his colleagues wanted to turn up uninvited in the alcove of the unit to give Ms Roy a direction under reg 6 of the Domestic and Family Violence Regulations, then they needed to rely on s 126(2A) of the Police Administration Act. They chose not to do so. There could be no suggestion that reg 6 is itself a source of authority to enter land without permission36, and there could be no suggestion that the power of direction conferred by reg 6 can be lawfully exercised by a trespasser37. In the subsequent prosecution of Ms Roy in the Local Court of the Northern Territory for the offence of contravening the DVO contrary to s 120 of the Domestic and Family Violence Act, the evidence obtained by use of the power of direction was correctly determined by Judge Woodcock to have been unlawfully obtained. On that basis, the evidence was excluded under s 138 of the Evidence (National Uniform Legislation) Act (NT) and Ms Roy was acquitted. 34 O'Neill v Roy (2019) 345 FLR 29 at 30-31 [3]. 35 O'Neill v Roy (2019) 345 FLR 29 at 39 [37]. 36 cf Coco v The Queen (1994) 179 CLR 427 at 437-438. 37 cf Halliday v Nevill (1984) 155 CLR 1 at 18; New South Wales v Koumdjiev (2005) 63 NSWLR 353 at 360 [26]. See also Morris v Beardmore [1981] AC 446 at 463. Bell On appeal the Northern Territory, Judge Woodcock's decision was correctly upheld by Mildren A-J38. However, his Honour expressed the scope of the implied licence too narrowly when he said39: the Supreme Court of "[N]either the police nor anyone else has an implied invitation to enter private property, or the threshold of a person's home, for the mere purpose of investigating whether a breach of the law has occurred or for the purpose of gathering evidence of criminal activity by the occupier". The dismissal of the appeal from Judge Woodcock's decision ought not to have been overturned on further appeal to the Court of Appeal40. The Court of Appeal conceived of the implied licence too broadly when it said that Constable Elliott and his colleagues were within the scope of the implied licence merely because their "approach was for the purpose of lawful communication which is a legitimate purpose"41. Whether or not their purpose can be described as "legitimate", it was coercive. That took their presence in the alcove beyond the scope of the implied licence. The appeal from the judgment of the Court of Appeal should be allowed. In place of the orders made by the Court of Appeal, the appeal to that Court should be dismissed. 38 O'Neill v Roy (2019) 345 FLR 8. 39 O'Neill v Roy (2019) 345 FLR 8 at 26 [44]. 40 O'Neill v Roy (2019) 345 FLR 29. 41 O'Neill v Roy (2019) 345 FLR 29 at 39 [37]. Edelman Introduction In ordinary circumstances, background social norms imply that every member of the public has a licence to enter the curtilage of a property to knock on a front door or ring a front doorbell in order to communicate with an occupier. A member of the public who has concerns about the welfare of an occupant can knock on the door to ask if the person is all right or to ask if the person is safe. This appeal concerns the authority of the police to engage in the same conduct in order to address a plague of domestic violence in Katherine in the Northern Territory. The appellant's primary argument is that the police have no power merely to knock on the door of an abused occupier living with the abuser simply to ask "Are you ok?". The alternative argument is that our social norms deprive the police of a licence to do so in the very circumstance in which the occupier might desperately hope for the police to enquire about their welfare: where the occupier is known by the police to have been abused by a co-habitant in the past so that the police intend, if the enquiry or circumstances reveal it to be necessary, to exercise a protective power. The broad context in which the issue arises is a visit by the police to the unit occupied by the appellant, Ms Roy, and her co-habiting partner, Mr Johnson. Mr Johnson suffered from a medical condition and was a vulnerable person. Ms Roy described herself as his carer. She was subject to a domestic violence order ("DVO") protecting Mr Johnson but the police suspected Ms Roy of abusing and manipulating Mr Johnson, particularly when alcohol was involved, and they were aware that she had previously stabbed him. The unchallenged police evidence was that "one of the main reasons" for their visit was their concern for Mr Johnson's welfare. The police never entered the unit occupied by Ms Roy and Mr Johnson. Ms Roy answered the door in a state of intoxication and was requested to take a breath test. The breath test was positive for alcohol, suggesting a violation of a condition of the DVO which required her not to remain in Mr Johnson's presence while intoxicated. Ms Roy's central submission is that although members of the general public have an implied licence to enter the curtilage of a property for the purpose of knocking on the front door to communicate with the occupier, the police have no implied licence to do so if their purpose for communicating is related to investigating a crime, such as domestic violence, that one of the occupiers is suspected of committing, even if the other occupier is a suspected victim of the crime. Ms Roy also submitted that the police have no licence to enter the curtilage of the premises if the purpose of enquiry is accompanied by an intention, however contingent or speculative, that the police might exercise coercive power. In other Edelman words, the police would lose their licence to enter the curtilage to enquire about the welfare of a victim of domestic violence in the circumstances in which such an enquiry would be of the greatest value to a victim of abuse. Neither of these submissions should be accepted. The background norms of our society do not imply that a home is a sanctuary from which to abuse an occupier behind closed doors. Nor do they provide sanctuary from police knocking on the door, to make the same enquiry that would be made by any decent and moral person who is concerned that the occupant might be abused, with the intention of exercising any powers if it is necessary to protect that occupant. The appeal must be dismissed. Background On 1 June 2017, on the application of a third party, the Local Court of the Northern Territory, sitting at Katherine, made a DVO against Ms Roy. The protected person was her partner, Mr Johnson. The order imposed five conditions upon Ms Roy for a period of 12 months. Conditions 1, 2, 4 and 5 restrained her from doing the following, directly or indirectly: (1) approaching, contacting or remaining in the company of Mr Johnson when consuming alcohol or another intoxicating drug or substance or when under the influence of alcohol or another intoxicating drug or substance; (2) approaching, entering or remaining at any place where Mr Johnson is living, working, staying, visiting or located if consuming alcohol or another intoxicating drug or substance or when under the influence of alcohol or another intoxicating drug or substance; (4) causing harm or attempting or threatening to cause harm to Mr Johnson; and (5) intimidating or harassing or verbally abusing Mr Johnson. Condition 3 provided that Ms Roy must "submit to a breath test and/or breath analysis when requested by police in relation to this order". The order was made with the consent of Ms Roy. In 2018, a police officer, Constable Elliott, was concerned for the welfare of Mr Johnson. He knew from speaking to Ms Roy previously that Mr Johnson suffered from seizures and that she was Mr Johnson's carer. He had seen Ms Roy with Mr Johnson at a bottle shop where Ms Roy was in charge of Mr Johnson's "BASICs card" and money. He believed that Mr Johnson might be the subject of economic abuse42. He became suspicious and, upon making enquiries, discovered that there had previously been eight "incidents". No evidence was given about the nature of those incidents but Constable Elliott learned that on a previous occasion Ms Roy had stabbed Mr Johnson. In late March 2018, Constable Elliott had seen Ms Roy involved in what he described as "social order offences". He had warned her about possible breaches of her DVO and had taken her to a sobering up shelter. 42 See Domestic and Family Violence Act (NT), s 8. Edelman In the weeks before April 2018, Constable Elliott had observed antisocial behaviour coming from the unit that Ms Roy shared with Mr Johnson. In April 2018, the Northern Territory Police Force in Katherine conducted Operation Haven. This operation involved police activities designed to address concerns about domestic violence and alcohol-related crime. The trial judge described domestic violence in the Northern Territory as a "plague ... especially in a place like Katherine". The police activities included proactive "compliance checks" at the premises of persons subject to a DVO. Members of the Police Force were aware that most of the domestic violence in the Northern Territory occurs "in the home behind closed doors". On 6 April 2018, as part of Operation Haven, three police officers visited the unit that Ms Roy shared with Mr Johnson. The police officers were Constables Elliott and Dowie and Senior Sergeant Evans. The unit was part of multi-dwelling units of public housing, which units were side by side or facing each other. Entries through the external fence led to common pathways through the yard outside the high density unit dwellings. The police officers entered the curtilage, which included the yard and the common area of the unit dwellings, and walked up one of the common pathways which led to an alcove within which was the main front door of the unit occupied by Ms Roy and Mr Johnson. The main front door was open but a fly-screen door in front of it was closed. Constable Elliott knocked on the fly-screen door. He looked through the fly-screen and saw Mr Johnson sitting on a couch and Ms Roy lying on the floor. Although there is no finding as to the precise words he used, he called upon Ms Roy to come to the door for a DVO check. Constable Elliott noticed that when she got up from the floor she was very lethargic. When she approached him, Constable Elliott could smell a very strong odour of liquor on her breath. He saw that her eyes were bloodshot and she was slurring her speech a lot more than on past occasions when he had spoken with her. He asked her to submit to a breath test. She agreed. The test was taken in the alcove or on the step outside the front door. The test gave a positive reading for alcohol. Ms Roy was taken to the watch-house, where five attempts were made to take a breath sample from her for analysis. It was thought that a sufficient sample could not be obtained due to her state of intoxication. The trial and the appeals Ms Roy was charged by the respondent, Sergeant O'Neill, with one count of contravention of s 120(1) of the Domestic and Family Violence Act (NT). That section provides that a person commits an offence if the person engages in conduct that results in a contravention of a DVO. The conduct relied upon was not particularised but the trial was apparently conducted on the implicit basis that the offence was a breach of either condition 1 or 2 of Ms Roy's DVO by Ms Roy remaining in the presence of Mr Johnson while intoxicated. Edelman The trial was held before Judge Woodcock in the Local Court of the Northern Territory. The trial judge held that the police officers did not have the power under the Domestic and Family Violence Act or the Police Administration Act (NT) to enter private property so that there was no basis for their request for a breath test. The trial judge observed that Constable Elliott "did not extend his state of mind to an endeavour [to justify the direction for a breath test] by s 126 of the Police Administration Act", which would have empowered him to enter the premises if he believed on reasonable grounds that a contravention of a DVO had occurred or was occurring. The evidence from the breath test was excluded. The trial judge found Ms Roy not guilty. An appeal was brought by Sergeant O'Neill to a single judge of the Supreme Court of the Northern Territory43. The grounds of appeal all focused upon the finding by Judge Woodcock that the police officers had no power to enter the curtilage of a private residence to check compliance with the conditions of a DVO, although such entry would necessarily have involved the purpose of lawful communication with the occupiers, Ms Roy and Mr Johnson. The appeal was dismissed by Mildren A-J. His Honour held that the police do not have an implied licence to enter private property for the "mere purpose of investigating whether a breach of the law has occurred"44. Despite the absence of any finding to this effect by Judge Woodcock, and despite the lack of any such assertion in a notice of contention, Mildren A-J referred with apparent approval to Ms Roy's submission that the sole purpose that the police had in knocking on Ms Roy's door was to submit her to a breath test. His Honour rejected the police's submission that the purpose of the compliance check was concern for the welfare of Mr Johnson, asserting that if Constable Elliott had that purpose then it would have been expected that he would have enquired about the welfare of Mr Johnson. Sergeant O'Neill brought a further appeal to the Court of Appeal of the Supreme Court of the Northern Territory. The Court of Appeal (Southwood and Kelly JJ and Riley A-J) held that the police had a dual purpose in entering the curtilage of the premises. The first purpose was "to determine whether the terms of a DVO were being honoured" and the second was "to check on the well-being of the protected person under the Order"45. The Court of Appeal held that the police officers had an implied licence to enter the curtilage of the property because these purposes involved lawful communication with the occupier of the unit and did not 43 See Local Court (Criminal Procedure) Act (NT), s 163(3). 44 O'Neill v Roy (2019) 345 FLR 8 at 26 [44]. 45 O'Neill v Roy (2019) 345 FLR 29 at 39 [37]. Edelman involve an interference with the occupier's possession, or injury to the person or property of either occupier. The appeal was allowed. Ms Roy has two grounds of appeal to this Court. One ground asserts a specific error by the Court of Appeal in what was said to be its conclusion that an implied licence entitled the police officers to enter upon the curtilage of Ms Roy's premises for the purposes of investigating Ms Roy for a criminal offence because they did so with the additional purpose of communicating with another occupant of the same dwelling. The other ground of appeal asserts a general error by the Court of Appeal in its conclusion that the police were not trespassers on the curtilage of the premises. The grounds of appeal, as presented in submissions, raise essentially two issues. First, did the police officers commit a trespass when they entered the curtilage of the unit occupied by Ms Roy or did they have an implied licence to enter and to approach the front door to communicate with Ms Roy and Mr Johnson? Secondly, if the police officers had such an implied licence, did that licence terminate, with the effect that the police became trespassers, when Constable Elliott asked Ms Roy to provide a sample of her breath? Legal principles concerning implied licences An implied licence to enter onto land A person who enters the land of another must justify that entry by lawful authority including consent or licence of the person with the right to immediate possession, generally described as the occupier46. If a licence to enter is not express then it can be implied from the particular factual circumstances. The implication upon which Ms Roy relies on this appeal is an implication in law, not an implication in fact. The two are closely related. An implication in law is based upon background facts and conventions rather than reasons of desired public policy. It is akin to a presumption and it is based upon "an incident of living in society"47, "the reasonable requirements of society"48, "the habits of the 46 See Halliday v Nevill (1984) 155 CLR 1 at 10; Kuru v New South Wales (2008) 236 CLR 1 at 15 [43]. 47 Halliday v Nevill (1984) 155 CLR 1 at 19. 48 Tararo v The Queen [2012] 1 NZLR 145 at 172 [15]. Edelman country"49, or "background social norms"50. A licence will only be implied as a matter of law if there is nothing "in the objective facts which is capable of founding a conclusion that any such implied or tacit licence was negated"51. And this implied licence can be revoked at any time52, which will require the invitee to leave the land as soon as is reasonably practicable53. In Halliday v Nevill54 the joint judgment of Gibbs CJ, Mason, Wilson and Deane JJ described the core, or most common, instance of a licence implied by law to enter land as follows: "The most common instance of such an implied licence relates to the means of access, whether path, driveway or both, leading to the entrance of the ordinary suburban dwelling-house. If the path or driveway leading to the entrance of such a dwelling is left unobstructed and with entrance gate unlocked and there is no notice or other indication that entry by visitors generally or particularly designated visitors is forbidden or unauthorized, the law will imply a licence in favour of any member of the public to go upon the path or driveway to the entrance of the dwelling for the purpose of lawful communication with, or delivery to, any person in the house." An implied licence to enter land, and to remain on the curtilage of the property outside the front door, for the purpose of communicating with the occupier of premises is reinforced by the presence of a bell or knocker on the door: "The knocker says, 'Come and knock me'; the bell says, 'Come and ring me'"55. Contrary to the submissions of Ms Roy on this appeal, where the implied licence concerns entry for the purpose of communication with the occupier of a premises, 49 McKee v Gratz (1922) 260 US 127 at 136. 50 Florida v Jardines (2013) 569 US 1 at 9. 51 Halliday v Nevill (1984) 155 CLR 1 at 7. 52 Halliday v Nevill (1984) 155 CLR 1 at 7. 53 Kuru v New South Wales (2008) 236 CLR 1 at 15 [43]. See also Davis v Lisle [1936] 2 KB 434 at 438-439, 441; Lambert v Roberts [1981] 2 All ER 15 at 19; Dobie v Pinker [1983] WAR 48 at 59. (1984) 155 CLR 1 at 7. 55 Smith v London and Saint Katharine Docks Co (1868) LR 3 CP 326 at 331, quoted in Lipman v Clendinnen (1932) 46 CLR 550 at 557. Edelman the communication need not be one that is desired by, or for the benefit of, the occupier. For instance, as Dixon J said in Lipman v Clendinnen56, a customer who returns to a shop to complain about the quality of goods purchased or the change received has an implied licence to enter the shop "during this accessory visit, though it might not be for the shopkeeper's benefit, as during the principal visit, which was". The circumstances in which a licence to enter land will be implied in law are not limited to the common instances of lawful communications with, or deliveries to, the occupants of a premises. As the joint judgment in Halliday explained, the path or driveway is "held out by the occupier as the bridge between the public thoroughfare and his or her private dwelling upon which a passer-by may go for a legitimate purpose that in itself involves no interference with the occupier's possession nor injury to the occupier, his or her guests or his, her or their property"57. Other examples of a licence implied in law include entry upon a driveway for the purposes of recovering an item of property or an errant child58. In Halliday it was also held that a member of the police force, acting in the ordinary course of his duties, had an implied licence to enter an open driveway for the purpose of questioning or arresting a person who was not the occupier of the property but whom the officer had observed committing an offence on a public street in the immediate vicinity of that driveway59. When trespass occurs despite an implied licence If an implied licence to enter is limited to a particular purpose and if the sole purpose of entry is entirely outside that particular purpose, then the entrant will be a trespasser. Thus, in Barker v The Queen60, although Mr Barker had an express licence to enter the property to look after it while the owner was away, it was open to the jury to conclude that he entered as a trespasser if his sole purpose was to commit theft so that his entry "was quite unrelated to the invitation or (1932) 46 CLR 550 at 559, quoting from Indermaur v Dames (1866) LR 1 CP 274 57 Halliday v Nevill (1984) 155 CLR 1 at 7-8. 58 Halliday v Nevill (1984) 155 CLR 1 at 7. 59 Halliday v Nevill (1984) 155 CLR 1 at 8. (1983) 153 CLR 338 at 348. Edelman licence which he had". In TCN Channel Nine Pty Ltd v Anning61, an employee of the appellant who had an implied licence to enter the curtilage of the property to ask the occupier for permission to film was a trespasser because her purpose of entry was not to communicate. It was solely to make a film recording, irrespective of any communication with the occupier. On the other hand, a person who enters for one or more of the purposes within an implied licence will not usually be a trespasser even if they have some other purpose that falls outside the scope of the licence: a person's entry to a premises for an authorised purpose "is not made unlawful because he enters with another and alien purpose in mind"62. For this reason, in Healing (Sales) Pty Ltd v Inglis Electrix Pty Ltd63, Barwick CJ and Menzies J held that an entry onto land was not a trespass even though it involved both a lawful and licensed purpose of removing display plan goods and an unlawful and unlicensed purpose of removing the plaintiff's own goods. And in Barker v The Queen64, Mason J gave an example of a person who enters a shop for the purpose of stealing, saying that the person is not a trespasser at the moment of entry if the entry is accompanied by another purpose within the ambit of the shopkeeper's implied invitation. This implication in law of a licence in instances of mixed purposes reflects the realities and incidents of social life. The realities and incidents of social life do not require the drawing of imperceptible, jurisprudential distinctions based upon whether a purpose within a licence is or is not accompanied by other subjective motivations or purposes that might lie outside the licence, especially where the other subjective motivations or purposes might be conditional, subservient, or uncertain, or might never be acted upon. If such distinctions were drawn the operation of an implied licence would be practically unworkable. Of course, as will be seen below, once the invitee acts upon any such motivation in a manner inconsistent with the licence the invitee will become a trespasser. The only, rare, exception to this principle concerning mixed purposes is where the occupier, expressly or impliedly, makes clear that the licence is for an exclusive purpose and does not extend to entry for a mixed purpose. In those unusual circumstances, described by Brennan and Deane JJ in Barker v The Queen (2002) 54 NSWLR 333 at 348 [69], 349 [75], [78]. 62 Barker v The Queen (1983) 153 CLR 338 at 347. (1968) 121 CLR 584 at 598-599, approving the approach of Sugerman J in Inglis Electrix Pty Ltd v Healing (Sales) Pty Ltd (1967) 69 SR (NSW) 311 at 330-331. See also Barker v The Queen (1983) 153 CLR 338 at 365. (1983) 153 CLR 338 at 348. See also at 361-362. Edelman as circumstances permitting entry only where it is "exclusively for the particular purpose"65, a person who enters also with an alien purpose will be a trespasser. For instance, no implied licence will arise for entry for the purpose of communication with the occupier, even when that purpose is accompanied by the purpose of delivering a parcel, if a sign is hung on a front gate saying "Entry is permitted only for the delivery of parcels. Parcels must be left on the doorstep without knocking on the door." When an implied licensee later becomes a trespasser At any point in time a person is either a trespasser or is not a trespasser in relation to the same land66. If a person's licence to be present on land concludes, is exceeded, or is revoked then the person will be a trespasser unless the person has some independent legal authority to be present on the land. Therefore, a person who is not a trespasser upon entry to land can become a trespasser if the purpose of their licence is exhausted, if the licence is revoked, or if the person performs acts that are beyond the scope of their licence67. The most common instance where a right to enter or remain on land by implied licence will cease, making the entrant a trespasser from that point in time, is where the implied licence is revoked. An example is Davis v Lisle68. In that case, police officers entered a garage to make an enquiry of the occupier about the presence of a motor lorry that had been responsible for an earlier obstruction. The occupier of the garage told the officers to leave but they did not do so. Even if the officers had an implied licence to enter the garage the licence would have terminated when they were told to leave. As Lord Hewart CJ said69: "It is one thing to say that the officers were at liberty to enter this garage to make an inquiry, but quite a different thing to say that they were entitled to remain when, not without emphasis, the appellant had said: 'Get outside. (1983) 153 CLR 338 at 365. 66 Healing (Sales) Pty Ltd v Inglis Electrix Pty Ltd (1968) 121 CLR 584 at 598-599, 67 Barker v The Queen (1983) 153 CLR 338 at 357. See also at 345. 69 Davis v Lisle [1936] 2 KB 434 at 437-438. Edelman You cannot come here without a search warrant.' From that moment on ... the officers ... were trespassers". An example where a person becomes a trespasser by performing acts beyond the scope of the licence was colourfully given by Scrutton LJ, who said that when "you invite a person into your house to use the staircase, you do not invite him to slide down the banisters"; at the point of sliding down the banisters the invitee becomes a trespasser70. Thus, in Healing (Sales) Pty Ltd v Inglis Electrix Pty Ltd71, Kitto J held that the defendant's servants became trespassers when they took physical steps for the unauthorised purpose of taking goods that were not subject to display plan agreements. Implied licences for the police to enter or remain on land Unless there are specific circumstances indicating otherwise, such as a notice saying "Police keep out"72, the implied licence to enter land applies to all members of the public, including police officers, who "reasonably think that they have ... legitimate business with the occupier"73. The police have the same implied licence as other members of the public to approach and knock on a front door, or ring a front doorbell, for the purpose of lawful communication with an occupier. The licence implied in law for all members of the public with a purpose of communicating with an occupier is not negated by the presence of some additional, perhaps contingent, subjective motivation. So too, the implied licence for police to communicate with an occupier is not negated by a subjective, perhaps contingent, motivation for the communication to investigate an occupier for the commission of a criminal offence. The case that establishes that police do not lose the implied licence to communicate where the motive for communication is to investigate the occupier for an offence is Robson v Hallett74. This decision, or the principle recognised in 70 The Carlgarth; The Otarama [1927] P 93 at 110, quoted with approval on this point in Hillen and Pettigrew v ICI (Alkali) Ltd [1936] AC 65 at 69. (1968) 121 CLR 584 at 606. 72 See Halliday v Nevill (1984) 155 CLR 1 at 19. 73 See Lambert v Roberts [1981] 2 All ER 15 at 19; Dobie v Pinker [1983] WAR 48 at Edelman it, has been acknowledged or applied for more than half a century75. In Robson v Hallett, three police officers, without a warrant, entered the curtilage of premises occupied by people including Dennis and Thomas Robson. The police were investigating a misdemeanour that had happened that night. When Thomas Robson opened the door, Constable Paxton asked him where he had been that night. In the events which followed, Dennis and Thomas Robson committed various assaults, including upon Constable Paxton. Their convictions for the assault of Constable Paxton were upheld at the Durham Quarter Sessions. They appealed to the Divisional Court on the ground that the police officers had trespassed when they entered the curtilage of the premises. Their appeal was dismissed. Diplock LJ considered that "no one has thought it plausible up till now to question" the existence of an implied licence for any person "who has lawful reason for doing so" to proceed from the gate to the front door of a premises "to inquire whether he may be admitted and to conduct his lawful business"76. Like other members of the public, and without any other specific powers, police officers will be trespassers if (i) the sole purpose for their entry onto the premises is outside the scope of any implied licence, (ii) they remain on the land after the licence is revoked, or (iii) they act in a manner inconsistent with the licence. An example of the police entering premises with a sole purpose that is outside the implied licence is Florida v Jardines77. In that case, a majority of the Supreme Court of the United States reiterated that although the implied licence to approach the front door was not negated by the "mere 'purpose of discovering information'", the sole purpose in that case was to search the premises: "no one is impliedly invited to enter the protected premises of the home in order to do nothing but conduct a search"78. An example of trespass when police act outside the scope of the licence is Tasmania v Crane79. In that case the police were held to have an implied licence to enter a property in order to make enquiries of the occupier concerning a poppy crop being grown on nearby land, which the landowners had alleged to be grown by somebody without the landowners' consent. When the 75 Halliday v Nevill (1984) 155 CLR 1 at 19; Barbaro v Spyrou (1991) 13 MVR 449 at 455; R v Bradley (1997) 15 CRNZ 363 at 368; Arnold v Police [2004] SASC 74 at [9]; Tararo v The Queen [2012] 1 NZLR 145 at 149-150 [18]-[20], 154 [33], 171 [11]-[12]; R v Daka [2019] SASCFC 80 at [76]. 76 Robson v Hallett [1967] 2 QB 939 at 953-954. See also at 951 (Lord Parker CJ). 78 Florida v Jardines (2013) 569 US 1 at 9 n 4. (2004) 148 A Crim R 346. Edelman police officers began to walk around the building to investigate they exceeded their licence and became trespassers. Apart from the licence which is implied in law by the common law, there are cases "provided for by the common law and by statute" where police officers have "special rights to enter land"80. In those special cases, a balance is struck "between public authority and the security of private dwellings"81. Examples of those special cases include the common law power for a police officer to enter a home to arrest a person at or immediately after the time of commission of a misdemeanour or who is suspected on reasonable grounds of being the offender of a felony82, and arguably also in some cases of breach of the peace or apprehended breach of the peace83. An example of an implied licence possessed by police officers which ordinary members of the public do not possess is the licence recognised in Halliday to enter the curtilage of a property to question or arrest a person who is not an occupier of the property and whom the officer had observed committing an offence84. However, that circumstance, described as "hedge-hopping", was said by Lord Diplock to involve "very different considerations" from those where the person to be subject to coercive process is the occupier85. The recognition of a common law implied licence to enter private land to assert any coercive power against the occupier or the occupier's guests would disturb the proper balance between public authority and the security of private dwellings. It would cut across the common law regime of special cases, described above, which license the entry onto land for the purpose of exercising only particular coercive powers and only 80 Kuru v New South Wales (2008) 236 CLR 1 at 15 [43]. 81 Kuru v New South Wales (2008) 236 CLR 1 at 15 [45], quoting Halliday v Nevill (1984) 155 CLR 1 at 9. 82 Halliday v Nevill (1984) 155 CLR 1 at 12; Plenty v Dillon (1991) 171 CLR 635 at 647. See also Nolan v Clifford (1904) 1 CLR 429 at 444; Hale, History of the Pleas of the Crown (1800), vol 2 at 85; Stephen, History of the Criminal Law of England (1883), vol 1 at 193. 83 Stephen, History of the Criminal Law of England (1883), vol 1 at 193; Halsbury's Laws of England, 5th ed (2019), vol 84A at 113. Compare the discussion in Kuru v New South Wales (2008) 236 CLR 1 at 17 [50]-[51]. 84 Halliday v Nevill (1984) 155 CLR 1 at 8. 85 Morris v Beardmore [1981] AC 446 at 456. Edelman in particular circumstances. It would also be inconsistent with the foundation of the implied licence in the habits and reasonable expectations of social life if the common law were to extend the licence in Halliday to permit a police officer to enter the curtilage of a property for the sole purpose of asserting any coercive power over the occupier or the occupier's guests. On the other hand, statutory provisions can build upon the common law implied licence, extending it by implication in limited circumstances such as where it is "necessary to prevent ... statutory provisions from becoming inoperative or meaningless"86. An example is Pringle v Everingham87. In that case, the Court of Appeal of the Supreme Court of New South Wales held that even after the revocation of the implied licence of police officers to be present in a car park on the private property of a hotel, the police officers were entitled to remain in order to complete a breath test that was in progress. As Hunt A-JA said, the issue was whether the police officers were entitled to remain in the car park to complete a breath test after any implied licence had been revoked88. The purpose of the legislation89 which authorised a police officer to require a driver to undergo a breath test on a "road or road related area" was held to require that the test be able to be completed90. Any necessary implication from the conferral of a statutory coercive power of authority to remain on private land will depend upon the text and purpose of the legislation. However, the greater the intrusion into a person's rights the more clarity of expression that will be required91. Other than statutory powers to arrest a person reasonably suspected of having committed an offence, which have often been held to provide a police officer with power at least to follow the person onto private 86 Coco v The Queen (1994) 179 CLR 427 at 436. (2006) 46 MVR 58. See also Lambert v Roberts [1981] 2 All ER 15; Dobie v Pinker [1983] WAR 48 at 50, 68-69; Fisher v Ellerton [2001] WASCA 315 at [30]-[31]. 88 Pringle v Everingham (2006) 46 MVR 58 at 76-77 [77]. 89 Road Transport (Safety and Traffic Management) Act 1999 (NSW), s 13(1). 90 Pringle v Everingham (2006) 46 MVR 58 at 77 [79]. 91 Mann v Paterson Constructions Pty Ltd (2019) 93 ALJR 1164 at 1200 [159]; 373 ALR 1 at 41-42; see also 93 ALJR 1164 at 1172 [4]; 373 ALR 1 at 4. See also Federal Commissioner of Taxation v Tomaras (2018) 265 CLR 434 at 467-468 Edelman property, including the person's own property, in order to effect the arrest92, a statutory implication will not usually extend further than to permit a police officer to remain on the curtilage of land in order to exercise a coercive power where the police officer was already lawfully present. Hence, it will be very difficult to imply a power to enter the curtilage of a property for the sole purpose of exercising a coercive power, and even more difficult to imply a power to enter a dwelling house on the property to do so93. Did the police officers have an implied licence to enter the curtilage of the unit occupied by Ms Roy and Mr Johnson? It is convenient to focus first upon Ms Roy's ground of appeal which alleges specific error by the Court of Appeal in what is described as a finding of an implied licence for the police officers to enter upon the curtilage of Ms Roy's premises for the purposes of investigating whether she was committing a criminal offence. In support of this ground of appeal, Ms Roy submitted that when Constable Elliott entered the curtilage he did not have any purpose of checking the welfare of Mr Johnson. Ms Roy submitted that Constable Elliott's only purpose was to direct her to take a breath test and that such a coercive purpose was not within the scope of the implied licence. If the factual foundation for Ms Roy's submissions on this ground were correct then her submission should be accepted. As explained above, outside special circumstances recognised by the common law, a police officer has no implied licence to enter land for the sole purpose of subjecting an occupier to a coercive process. But the factual assertion underlying Ms Roy's submission is contrary to the reasoning of the Court of Appeal, which reasoning is directly supported by the unchallenged evidence of Constable Elliott. As Judge Woodcock found, and as the Court of Appeal held, the purpose for which the police officers had attended the unit of Ms Roy and Mr Johnson was to conduct a "check" in relation to compliance with the DVO. On this appeal, Ms Roy properly accepted that this purpose was not in dispute. But, she submitted, 92 Dinan v Brereton [1960] SASR 101 at 104; Eccles v Bourque [1975] 2 SCR 739 at 744; Kennedy v Pagura [1977] 2 NSWLR 810 at 812; McDowell v Newchurch (1981) 9 NTR 15 at 18; Halliday v Nevill (1984) 155 CLR 1 at 16; Lippl v Haines (1989) 18 NSWLR 620 at 622, 632-633; R v Feeney [1997] 2 SCR 13 at 49-50 [47]; Wheare v Police (SA) (2008) 180 A Crim R 396 at 405-408 [28]-[37]; Police (SA) v Williams (2014) 246 A Crim R 317 at 341-343 [287]-[291]; Bennett v Police (SA) (2016) 261 A Crim R 80 at 89 and following. 93 Dobie v Pinker [1983] WAR 48 at 60-61. See also Clowser v Chaplin [1981] 1 WLR 837 at 841-842; [1981] 2 All ER 267 at 270. Edelman contrary to the "dual purpose" finding of the Court of Appeal, but consistently with the finding of Mildren A-J, the police's purpose involved no concern for the The second purpose in the dual purpose finding by the Court of Appeal, namely the police's concern to check upon the welfare of Mr Johnson, followed almost inevitably from the first, namely the purpose of conducting a "check". The very nature of Operation Haven, and the compliance checks that it involved, was to address the effects upon victims of domestic violence that Judge Woodcock described as a "plague" and much of which, as the police were aware, occurred behind closed doors. Further, Constable Elliott's evidence was that the welfare of Mr Johnson was "actually one of the main reasons I went [to the unit] ... I had a pretty serious concern ... that there's been quite a bit of manipulation going on in that relationship". He later added that a further reason "as to why I actually went to this house on the day ... is [that] Ms Roy had actually stabbed her partner, Mr Johnson, who is a vulnerable person". And in cross-examination he said that he went to the unit because he believed "that there may have been domestic violence occurring at that premises that we weren't aware of". That evidence was uncontradicted and unchallenged at trial. The finding of the Court of Appeal that the police officers had a purpose of enquiring about the welfare of Mr Johnson is sufficient foundation for the conclusion that the police had an implied licence to enter the curtilage of the premises, including walking down the common pathway and standing in the alcove at the main front door of the unit occupied by Ms Roy and Mr Johnson. That implied licence would not have been negated by any other subjective motivation for the enquiry such as to investigate Ms Roy, whether or not that motivation was certain or uncertain, and whether or not it was contingent upon other events such as Ms Roy being present at the unit. For these reasons, any subjective intentions or motivations of the police related to their desire to communicate with the occupiers, such as to investigate an offence involving breach of the DVO or to direct Ms Roy to take a breath test, did not negate their implied licence to enter the curtilage. Nevertheless, in light of the focus upon the intention of the police in Ms Roy's submissions, it is necessary to explain what must have been meant by a statement of the Court of Appeal concerning the intention of Constable Elliott. In a separate part of the Court of Appeal's reasons from that which considered the purpose of the police, the Court of Appeal said that Constable Elliott "was intending to obtain a sample of [Ms Roy's] breath for analysis"94. That statement was made in the context of describing Constable Elliott's belief that Ms Roy was "a continuous alcohol- related offender". The statement was not based upon any direct evidence from 94 O'Neill v Roy (2019) 345 FLR 29 at 30-31 [3]. Edelman Constable Elliott that he intended to obtain a sample of Ms Roy's breath. It must have been derived from his evidence that "I believe[d] ... she was going to be intoxicated because every time I've dealt with her ... she has always been intoxicated". The finding of intention must mean, and can only be justified as meaning, that Constable Elliott intended to obtain a sample of Ms Roy's breath if circumstances so required, as he expected that they would. Plainly, if Ms Roy had not been present at the unit then Constable Elliott could not have obtained a sample of her breath; his only action could have been to communicate with Mr Johnson. And there is also no basis to infer from the evidence that if, contrary to Constable Elliott's expectation, Ms Roy were present and plainly sober then Constable Elliott would still have sought a sample of her breath. Constable Elliott had an intention to obtain a breath sample but it was a contingent, speculative intention. These circumstances illustrate the unworkability of an approach which denies an implied licence to any officer who might have a contingent intention to exercise coercive power. A police officer could never be confident of having a licence to knock on the door of a person suspected of domestic violence merely to enquire about compliance with a DVO or the welfare of a co-habitant, since any police officer in those circumstances would intend to exercise coercive power if it were required for protection of an occupier. One possibility would be for the courts to develop, and police officers to act upon, extremely fine philosophical distinctions between background conditional intentions and conditional, speculative intentions. That would be hopeless in practice. The other possibility is that proactive policing would be dead. The police could no longer knock on the door of the very occupiers who might be in the most desperate need, to ask "Are you ok?". Did the police officers become trespassers when they asked Ms Roy for a sample of her breath? Ms Roy submitted, and the respondent did not dispute, that the request for a breath sample by Constable Elliott was a direction under reg 6(1)(a) of the Domestic and Family Violence Regulations (NT), which provides that a defendant "must comply with ... a reasonable direction by an authorised person to submit to a breath test to assess whether the defendant may have alcohol in his or her breath". For the purposes of that direction, it is "not necessary that the authorised person suspects that the defendant has consumed alcohol"95. Ms Roy submitted that the implied licence to be on her property did not extend to making a coercive direction. As explained above, the making of a coercive direction is beyond the scope of the licence generally implied by law to enter the curtilage of a property. Unless 95 Domestic and Family Violence Regulations (NT), reg 6(2). Edelman that direction were supported by a separate source of authority to be present upon the land, the making of the direction would involve a trespass. One possible source of authority in this case might be a necessary implication from reg 6(1)(a), permitting an authorised person to remain on land which they entered with an implied licence. Such a necessary implication would not merely arise from an asserted need to avoid stultification of the purpose of the legislation. It might arguably also be supported by the need for coherence with regs 7(1)(b) and 7(3), which permit a police officer to detain, and if necessary arrest, a defendant for the purposes of conducting a breath analysis if the officer suspects on reasonable grounds that the defendant may have consumed alcohol. If a police officer, lawfully present upon the property of Ms Roy with an implied licence, has the power to remain on the land to arrest her in order to conduct a breath analysis then it would border on the bizarre to conclude that the officer does not have the power to remain on the land to direct her to submit to a breath test in the event that she should decline to do so voluntarily. There is, of course, no suggestion that Ms Roy did not comply voluntarily with the request for a breath test. No question of coercion would arise unless and until Ms Roy refused to consent to provide a breath test, and Constable Elliott decided to invoke the power conferred by reg 6(1)(a). Ultimately, it is unnecessary to consider the extent of any necessary implication of authority to remain on the land that might arise from reg 6(1)(a). In her submissions Ms Roy accepted that once the powers under s 126(2A)(b) of the Police Administration Act were enlivened, those powers would provide an independent source of authority for the police to remain on the land. Section 126(2A)(b) provides that a member of the police force may "by reasonable force if necessary, enter a place if he believes, on reasonable grounds, that ... a contravention of an order under the Domestic and Family Violence Act has occurred, is occurring or is about to occur at the place". Constable Elliott's observations of Ms Roy's lethargy, her bloodshot eyes, the slurring of her speech, and the strong smell of alcohol plainly provided reasonable grounds for his belief that she was intoxicated in the presence of Mr Johnson in contravention of her DVO. Conclusion The appeal should be dismissed.
HIGH COURT OF AUSTRALIA SHANNEN ALYCE ROWE & ANOR PLAINTIFFS AND ELECTORAL COMMISSIONER & ANOR DEFENDANTS Rowe v Electoral Commissioner [2010] HCA 46 Date of Order: 6 August 2010 Date of Publication of Reasons and Further Order: 15 December 2010 ORDER Declare that Items 20, 24, 28, 41, 42, 43, 44, 45 and 52 of Sched 1 to the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth) are invalid. The second defendant to pay the plaintiffs' costs of the Further Amended Application for an Order to Show Cause. FURTHER ORDER Dismiss so much of the plaintiffs' application as remained after the order of this Court made on 6 August 2010. Representation R Merkel QC with K L Walker, F K Forsyth and N McAteer for the plaintiffs (instructed by Mallesons Stephen Jaques) G T Johnson for the first defendant (instructed by Australian Government Solicitor) S J Gageler SC, Solicitor-General of the Commonwealth with G R Kennett and D F O'Leary for the second defendant (instructed by Australian Government Solicitor) R M Mitchell SC with C S Bydder intervening on behalf of the Attorney-General for the State of Western Australia (instructed by State Solicitor's Office) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Rowe v Electoral Commissioner Constitutional law (Cth) – Legislative power – Franchise – Constitutional limitations upon power of Parliament to regulate exercise of entitlement to enrol to vote – Date for close of Electoral Rolls in Commonwealth Electoral Act 1918 (Cth) amended – Amendments precluded consideration until after election of claims for enrolment received after 8 pm on date of writs and of claims for transfer of enrolment received after 8 pm on third working day after date of writs – Whether denial of enrolment effected by amendments contravened constitutional requirement that representatives be "directly chosen by the people" – Whether amendments operated as disqualification from entitlement to vote and, if so, whether disqualification for substantial reason – Relevance of Roach v Electoral Commissioner (2007) 233 CLR 162. Words and phrases – "directly chosen by the people", "disqualification", "substantial reason". Constitution, ss 7, 8, 9, 10, 24, 30, 31, 51(xxxvi). Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth), Sched 1 Items 20, 24, 28, 41, 42, 43, 44, 45, 52. Commonwealth Electoral Act 1918 (Cth), ss 93, 94A(4), 95(4), 96(4), 101, Introduction The Constitution requires that members of Parliament be "directly chosen by the people"1. That requirement is "constitutional bedrock"2. It confers rights on "the people of the Commonwealth" as a whole3. It follows, as Isaacs J said in 1912, that4: "The vote of every elector is a matter of concern to the whole Commonwealth". Individual voting rights and the duties to enrol and vote are created by laws made under the Constitution in aid of the requirement of direct choice by the people. An electoral law which denies enrolment and therefore the right to vote to any of the people who are qualified to be enrolled can only be justified if it serves the purpose of the constitutional mandate. If the law's adverse legal or practical effect upon the exercise of the entitlement to vote is disproportionate to its advancement of the constitutional mandate, then it may be antagonistic to that mandate. If that be so, it will be invalid. Laws regulating the conduct of elections, "being a means of protecting the franchise, must not be made an instrument to defeat it"5. As the Court said in Snowdon v Dondas6: "The importance of maintaining unimpaired the exercise of the franchise hardly need be stated." The laws under challenge in this case would have disentitled persons otherwise qualified to be enrolled as electors before the election conducted on 1 Constitution, ss 7 and 24. 2 Roach v Electoral Commissioner (2007) 233 CLR 162 at 198 [82] per Gummow, Kirby and Crennan JJ; [2007] HCA 43. 3 Langer v The Commonwealth (1996) 186 CLR 302 at 343 per McHugh J; [1996] HCA 43. 4 Smith v Oldham (1912) 15 CLR 355 at 362; [1912] HCA 61. 5 An observation made by Isaacs J about the ballot in Kean v Kerby (1920) 27 CLR 449 at 459; [1920] HCA 35. (1996) 188 CLR 48 at 71; [1996] HCA 27, immediately thereafter quoting the remark of Isaacs J in Kean v Kerby (1920) 27 CLR 449 at 459. 21 August 2010 from recording a vote at all or from recording a vote for the district in which they lived. That disentitlement would have flowed from the failure by those persons to lodge claims for enrolment before the issue of the writs or for transfer of enrolment before the close of the Rolls. A statutory grace period of seven days for claims to be made after the issue of the writs had existed since 1983. Until 1983 an effective, albeit non-statutory, grace period had existed in all elections called since the 1930s by reason of the executive practice of announcing an election some days before the issue of the writs. The statutory grace period was effectively removed for new enrolments and significantly abridged for transfers of enrolment by the impugned amendment of the Commonwealth Electoral Act 1918 (Cth) ("the CEA") in 2006. On 6 August 2010, I joined in a majority of the Court in making a declaration that the relevant provisions of the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth) ("the Amendment Act") were invalid. My reasons follow. The declaration claimed and the grounds for the claim The plaintiffs claimed a declaration in the following terms: "A declaration that items 20, 24, 28, 41, 42, 43, 44, 45 and 52 of Schedule 1 of the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth) are invalid and of no effect." The grounds for relief were that: "The items referred to in paragraph 1 of the prayer for relief are: contrary to ss 7 and 24 of the Constitution; beyond the legislative powers of the Commonwealth conferred by ss 51(xxxvi) and 30 of the Constitution or any other head of legislative power; and reasonably appropriate and adapted, or beyond what proportionate, to the maintenance of the constitutionally prescribed system of representative government; and are therefore invalid and of no effect." The constitutional provisions Section 7 of the Constitution of the Commonwealth requires that the senators for each State be "directly chosen by the people of the State". Section 24 requires that the members of the House of Representatives be "directly chosen by the people of the Commonwealth". When the Commonwealth Constitution came into effect in January 1901, the qualification of electors of members of the House of Representatives was, by operation of s 30, that prescribed by State law as the qualification of electors of the more numerous House of Parliament of each State. Section 8 prescribed that the qualification of electors of members of the House of Representatives was the qualification of electors of senators. There was a transitional "constitutional franchise"7. Section 30 was to apply until the Commonwealth Parliament otherwise provided. In addition, by ss 10 and 31, until the Parliament of the Commonwealth otherwise provided, the laws in force in each State relating to elections for the more numerous House of the Parliament of the State, as nearly as practicable, applied to elections of senators for the State and of members of the House of Representatives. The Parliament of the Commonwealth was also empowered to make laws prescribing the method of choosing senators, but so that such method should be uniform for all States8. The words "[u]ntil the Parliament otherwise provides" in ss 10, 30 and 31 attract the power conferred upon the Parliament by s 51(xxxvi) to make laws "with respect to … matters in respect of which this Constitution makes provision until the Parliament otherwise provides". Read with s 30, s 51(xxxvi) empowers the Parliament to make laws providing for the qualification of electors of members of the House of Representatives. By operation of s 8 those qualifications are also the qualifications of the electors of senators. Read with ss 10 and 31, s 51(xxxvi) also empowers the Parliament to make laws relating to the election of senators and members of the House of Representatives. Those powers are exclusive to the Commonwealth9. Isaacs J characterised the power to make laws with respect to elections as a "plenary power over federal elections"10. To say that of the power under s 51(xxxvi) is to say what is true of every power conferred by s 5111. It is a power subject to the limitations imposed by the Constitution. The exercise of that power is in issue in this case. Parts II and III of Ch I of the Constitution contain other provisions relating to elections for the Senate and the House of Representatives, including provision 7 R v Pearson; Ex parte Sipka (1983) 152 CLR 254 at 278 per Brennan, Deane and Dawson JJ; [1983] HCA 6. 8 Constitution, s 9. 9 Smith v Oldham (1912) 15 CLR 355 at 358 per Griffith CJ, 360 per Barton J. 10 Smith v Oldham (1912) 15 CLR 355 at 363. 11 Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 604-605 per Gummow J; [1997] HCA 38. for the issue, by the Governor-General, of writs for general elections of members of the House of Representatives12 and for the issue by State Governors of writs for elections of senators for the States13. Section 41 protected the electors for the more numerous Houses of Parliament of the States from being prevented, by any law of the Commonwealth, from voting at elections for either House of the Parliament of the Commonwealth. That provision, however, has no effect on the present case as it only protects rights to vote which were in existence at Federation14. The statutory franchise Under the Constitution, the Commonwealth Parliament was to decide whether and when to pass laws defining the qualifications of electors and the methods of election. This it did by enacting the Commonwealth Franchise Act 1902 (Cth) and the Commonwealth Electoral Act 1902 (Cth). By the former Act it created a "statutory franchise"15 which replaced the constitutional franchise. Having defined the qualifications of electors, the Parliament could validly impose conditions upon the exercise of the right to vote which were incidental to or in aid of the laws defining the qualifications or embodied in laws relating to the election of senators and members of the House of Representatives. The Commonwealth Franchise Act 1902 and the Commonwealth Electoral Act 1902 and their successor statutes were enacted against the background of colonial laws defining the franchise, identifying those entitled to exercise it and providing for the conduct of elections. Not surprisingly those laws and their provision for voter enrolment as a condition of the right to vote were inspired by the electoral laws of the United Kingdom. The registration and listing of qualified electors on an electoral roll or list, as a condition of the exercise of the right to vote, was introduced in England and Wales by the Representation of the People Act 183216. Until 1832 a person wishing to vote "appeared at the poll, tendered his vote, and then and there swore an oath prescribed by statute to the effect that he had the requisite 12 Constitution, s 32. 13 Constitution, s 12. 14 R v Pearson; Ex parte Sipka (1983) 152 CLR 254 at 261 per Gibbs CJ, Mason and Wilson JJ, 278-279 per Brennan, Deane and Dawson JJ. 15 R v Pearson; Ex parte Sipka (1983) 152 CLR 254 at 278 per Brennan, Deane and 16 2 & 3 Will IV c 45, s 26. qualification"17. The 1832 Act was also the first step in a process of simplification and extension of what was a complex and restrictive franchise18. That complexity generated delays in electoral processes caused by the need, absent an electoral roll, to verify the identity and qualification of persons claiming to be entitled to vote. The purpose of registration therefore was "not so much to prevent fraud or to secure the rights of the bona fide electors, as to decrease the expense of elections"19. Legislative changes were made after 183220. Further reform statutes were passed in 1865 and 186721. Loss of voting rights for failure to comply with registration requirements was substantial. Registration was evidently a burdensome process and from the point of view of some electors: "the privilege of voting was not worth the pains"22. A common register was established in 1878 for parliamentary and municipal electors23. By the Registration Act 188524 the process of registration in counties was assimilated to that of boroughs and a uniform system put in place25. The system operated more smoothly after that time26. As appears from the history, the purpose of registration was practical and directed to dealing with the consequences of the complicated and diverse qualifications required for a person to become an elector. The relationship of registration to the franchise and the franchise to the qualification to vote was viewed in different ways by constitutional scholars. Sir William Anson characterised registration as "a condition precedent to the 17 Maitland, The Constitutional History of England, (1908) ("Maitland") at 355. 18 There were distinct county and borough franchises: see Anson, The Law and Custom of the Constitution, 4th ed (1909), vol 1 ("Anson") at 101-103, 105-109; Maitland at 351-357. 19 Seymour, Electoral Reform in England and Wales, (1915) ("Seymour") at 107. 20 Seymour at 118. 21 County Voters Registration Act 1865 (28 & 29 Vict c 36); Representation of the People Act 1867 (30 & 31 Vict c 102); Seymour at 160. 22 Seymour at 163. 23 Seymour at 375-376. 24 48 & 49 Vict c 15. 25 Seymour at 376; Anson at 132-133. 26 Seymour at 380-381. exercise of the right to vote" and as "preliminary to the enjoyment of the franchise"27. He applied the term "the Franchise" to the right to vote for members of the House of Commons28. He acknowledged that the term was also applied to the qualification which confers the right to vote. Maitland, on the other hand, said that "the only qualification that (in strictness) entitles one to vote is the fact that one is a registered elector"29. Quick and Garran, summarising the "qualifications of electors" under State laws at Federation, applied the term primarily to requirements such as gender, age and status as a natural-born or naturalised British subject but at one point appeared to include enrolment as a qualification30. The Commonwealth Franchise Act 1902 defined the class of persons entitled to vote by reference to age, residence, status as a natural-born or naturalised British subject, and enrolment for the Electoral Roll for any Electoral District31. The proposition that a person enrolled fell within the statutory term "qualified to vote" and was thereby entitled to sign an election petition was endorsed by Brennan ACJ in Muldowney v Australian Electoral Commission32. The right to vote conferred by s 93 of the CEA was then, as it is now and has been since the Commonwealth Franchise Act 1902, dependent upon enrolment33. Mason CJ in Re Brennan; Ex parte Muldowney34 thought s 93 prescribed "qualifications to be enrolled and to vote respectively". What Brennan ACJ said in Muldowney v Australian Electoral Commission was endorsed in Snowdon v Dondas35. 27 Anson at 134. 28 Anson at 101. 29 Maitland at 355. 30 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 469-470. The authors made a distinction between qualification and enrolment in their summary of the laws of New South Wales, Queensland and Western Australia, but elided the distinction in the summary relating to South Australia. 31 Commonwealth Franchise Act 1902, s 3. 32 (1993) 178 CLR 34 at 40; [1993] HCA 32. The term "qualified to vote" appears in s 355(c) of the CEA, which defines the entitlement to sign a petition disputing an election. 33 (1993) 178 CLR 34 at 39 per Brennan ACJ. 34 (1993) 67 ALJR 837 at 839; 116 ALR 619 at 623; [1993] HCA 53. 35 (1996) 188 CLR 48 at 72. faster colonies evolution The Australian towards enjoyed democratisation than the United Kingdom36. Universal manhood suffrage was adopted in South Australia with the introduction of responsible government37. Victoria and New South Wales followed suit in 1857 and 185838. The same franchise was introduced in Queensland in 1885 and Western Australia in 189339. Tasmania introduced it in 190140. The franchise was extended to women in South Australia in 1895 and Western Australia in 190041. Soon after Federation women The Commonwealth Franchise Act 1902 provided for universal adult franchise but excluded "aboriginal native[s] of Australia Asia Africa or the Islands of the Pacific except New Zealand", save for those entitled to vote by virtue of s 41 of the Constitution43. It also excluded persons of unsound mind, persons attainted of treason and persons under sentence or subject to be sentenced for any offence punishable by imprisonment for one year or more. the remaining States also acquired the franchise42. The electoral laws of the Australian colonies in the 19th century replicated important elements of the British system. A distinction between the qualification of electors and the requirements of listing, enrolment or registration was a common feature of such laws. The qualifications of electors were, for the most part, to be found in early colonial Constitutions, although sometimes they were 36 McMinn, A Constitutional History of Australia, (1979) at 62, cited in Roach v Electoral Commissioner (2007) 233 CLR 162 at 194-195 [69] per Gummow, Kirby 37 Constitution Act 1856 (SA), s 16. 38 Abolition of Property Qualification Act 1857 (Vic); Electoral Act 1858 (NSW), s 9. 39 Elections Act 1885 (Q), s 6; Constitution Act Amendment Act 1893 (WA), s 21. 40 Constitution Amendment Act 1900 (Tas), s 5. 41 Constitution Amendment Act 1894 (SA); Constitution Acts Amendment Act 1899 (WA), ss 15-17 and 26. 42 Women's Franchise Act 1902 (NSW); Constitution Amendment Act 1903 (Tas); Elections Acts Amendment Act 1905 (Q), s 9; Adult Suffrage Act 1908 (Vic). 43 Commonwealth Franchise Act 1902, s 4. Section 127 of the Constitution, providing that Aborigines were not to be counted in reckoning the numbers of the people of the Commonwealth, was repealed by the Constitution Alteration (Aboriginals) 1967 (Cth). repeated in electoral statutes44. Registration or enrolment requirements were found in statutes made under the Constitutions. The position at Federation was that the electoral laws of each of the Australian colonies conditioned the right to vote in an election upon enrolment on the relevant Electoral Roll45. Those electoral laws also provided for closure of the Electoral Rolls to new enrolments or transfers prior to polling day, although with variations in their cut-off dates46. Having regard to the historical origins and purpose of voter registration and the mixed usage of the term "qualification" evidenced in Quick and Garran, it might be thought that if enrolment is a qualification in the constitutional sense, it is at best ancillary to those qualifications which otherwise define the franchise. The history of registration laws in the United Kingdom and in Australia provide support for that characterisation. In any event, all laws of the Commonwealth Parliament providing for enrolment and for the conduct of elections must operate within the constitutional framework defined by the words "directly chosen by the people". Chosen by the people The content of the constitutional concept of "chosen by the people" has evolved since 1901 and is now informed by the universal adult-citizen franchise which is prescribed by Commonwealth law. The development of the franchise was authorised by ss 8 and 30 of the Constitution, read with s 51(xxxvi). Implicit in that authority was the possibility that the constitutional concept would acquire, 44 Australian Constitutions Act 1842 (Imp) (5 & 6 Vict c 76), ss 5-7; Constitutional Act 1854 (Tas), ss 6 and 17-19; New South Wales Constitution Act 1855 (Imp) (18 & 19 Vict c 54), Sched 1, s 11; Constitution Act 1855 (Vic), ss 5 and 12; Constitution Act 1856 (SA), ss 6 and 16; Constitution Act 1889 (WA), ss 39 and 53. The Constitution Act 1867 (Q) provided that members of the Legislative Assembly would be elected by inhabitants of the colony having qualifications mentioned in the Electoral Act for the time being: s 28. 45 Parliamentary Electorates and Elections Act 1893 (NSW), s 80; Constitution Act Amendment Act 1890 (Vic), s 241; Elections Act 1885 (Q), s 40; Electoral Code 1896 (SA), ss 36, 116 and 126; Electoral Act 1899 (WA), ss 21, 87 and 104; Electoral Act 1896 (Tas), s 57. 46 Parliamentary Electorates and Elections Act 1893 (NSW), ss 47-51; Constitution Act Amendment Act 1890 (Vic), ss 97 and 186; Elections Act 1885 (Q), s 40; Electoral Code 1896 (SA), ss 51, 52 and 57; Electoral Act 1899 (WA), ss 37 and 44; Electoral Act 1896 (Tas), s 57. as it did, a more democratic content than existed at Federation. That content, being constitutional in character, although it may be subject to adjustment from time to time, cannot now be diminished. In Attorney-General (Cth); Ex rel McKinlay v The Commonwealth47 its evolution was linked in the judgment of McTiernan and Jacobs JJ to "the common understanding of the time on those who must be eligible to vote before a member can be described as chosen by the people of the Commonwealth"48. Their Honours said49: "For instance, the long established universal adult suffrage may now be recognized as a fact and as a result it is doubtful whether, subject to the particular provision in s 30, anything less than this could now be described as a choice by the people." The term "common understanding", as an indication of constitutional meaning in this context, is not to be equated to judicial understanding. Durable legislative development of the franchise is a more reliable touchstone. It reflects a persistent view by the elected representatives of the people of what the term "chosen by the people" requires. Gleeson CJ adverted to the irreversible evolution of "chosen by the people" in Roach v Electoral Commissioner50 when he answered in the negative the question: "Could Parliament now legislate to remove universal adult suffrage?"51 The reason for that negative answer was to be found in ss 7 and 24 of the Constitution. Although those sections did not require universal adult suffrage in 1901, it had become, as McTiernan and Jacobs JJ had said in McKinlay, a "long established" fact52. The Chief Justice concluded that "in this respect, and to this extent, the words of ss 7 and 24, because of changed historical circumstances including legislative history, have come to be a constitutional protection of the right to vote"53. 47 (1975) 135 CLR 1; [1975] HCA 53. 48 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 49 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 50 (2007) 233 CLR 162. 51 Roach v Electoral Commissioner (2007) 233 CLR 162 at 173 [6]. 52 (1975) 135 CLR 1 at 36. 53 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7]. See also Langer v The Commonwealth (1996) 186 CLR 302 at 342 per McHugh J. It may be accepted, having regard to the narrower view of the franchise that subsisted in 1901, that the term "the people" in ss 7 and 24 of the Constitution is not limited to those who are qualified to vote. However, the adoption of universal adult-citizen franchise has caused the two concepts to converge. The people who choose are the electors. The non-inclusion of non- citizens, minors and incapable persons and persons convicted of treason or treachery, or serving sentences of imprisonment of three years or more for offences against Commonwealth, State or Territory law leaves little relevant room for distinguishing between "the people" and those entitled to become electors. While the term "directly chosen by the people" is to be viewed as a whole, the irreversibility of universal adult-citizen franchise directs attention to the concept of "the people". Analogous considerations may apply to the term "chosen" and to the means by which the people choose their members of Parliament. Where a method of choice which is long established by law affords a range of opportunities for qualified persons to enrol and vote, a narrowing of that range of opportunities, purportedly in the interests of better effecting choice by the people, will be tested against that objective. This is not to suggest that particular legislative procedures for the acquisition and exercise of the entitlement to vote can become constitutionally entrenched with the passage of time. Rather, it requires legislators to attend to the mandate of "choice by the people" to which all electoral laws must respond. In particular it requires attention to that mandate where electoral laws effect change adverse to the exercise of the entitlement to vote. In this case it is the alteration of a long- standing mechanism, providing last-minute opportunities for enrolment before an election, that is in issue. Criteria of validity The validity of a provision of the CEA disqualifying as voters persons serving any sentence of imprisonment for an offence against a Commonwealth or State law was in issue in Roach54. The section, which was held invalid, operated by way of an exception to universal adult-citizen franchise. The decision in Roach is not therefore directly applicable to this case. The general approach of the majority in Roach is, however, instructive. It informs, by close analogy, the approach which should be taken in this case to the challenged law in light of the constitutional mandate. Gleeson CJ observed in his judgment in Roach that55: 54 (2007) 233 CLR 162. 55 (2007) 233 CLR 162 at 174 [7] (footnote omitted). "Because the franchise is critical to representative government, and lies at the centre of our concept of participation in the life of the community, and of citizenship, disenfranchisement of any group of adult citizens on a basis that does not constitute a substantial reason for exclusion from such participation would not be consistent with choice by the people." Exceptions to universal adult-citizen franchise required "a rational connection with the identification of community membership or with the capacity to exercise free choice"56. Gummow, Kirby and Crennan JJ also spoke of the need for a "substantial reason" to justify an exception to universal adult-citizen franchise. That requirement would be satisfied by an exception "reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government"57. That formulation, their Honours said, approached the notion of "proportionality", for58: "What upon close scrutiny is disproportionate or arbitrary may not answer to the description reasonably appropriate and adapted for an end consistent or compatible with observance of the relevant constitutional restraint upon legislative power." The present case concerns an electoral law of a procedural or machinery character. It does not in terms carve out an exception to the franchise. It does, however, have a substantive effect upon entitlements to vote and so affects the exercise of the franchise. While "common understanding" of the constitutional concept of "the people" has changed as the franchise has evolved, "the people" is not a term the content of which is shaped by laws creating procedures for enrolment and for the conduct of elections. If such a law denies the right to vote to any class of person entitled to be an elector, it denies it to that class of "the people". Such a law may be valid. But the logic of the constitutional scheme for a representative democracy requires that the validity of such a law be tested by reference to the constitutional mandate of direct choice by "the people". Where, as in the present case, the law removes a legally sanctioned opportunity for enrolment, it is the change effected by the law that must be considered. It is not necessary first to 56 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [8]. 57 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85], referring also to Gleeson CJ in Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 199-200 [39]-[40]; [2004] HCA 41. 58 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85]. determine some baseline of validity. Within the normative framework of a representative democracy based on direct choice by the people, a law effecting such a change causes a detriment. Its justification must be that it is nevertheless, on balance, beneficial because it contributes to the fulfilment of the mandate. If the detriment, in legal effect or practical operation, is disproportionate to that benefit, then the law will be invalid as inconsistent with that mandate, for its net effect will be antagonistic to it. Applying the terminology adopted in Roach, such a law would lack a substantial reason for the detriment it inflicts upon the exercise of the franchise. It is therefore not sufficient for the validity of such a law that an election conducted under its provisions nevertheless results in members of Parliament being "directly chosen by the people". The Solicitor-General of the Commonwealth drew by analogy upon a distinction, made in this Court, between laws intended to impose a direct burden upon the implied freedom of political communication and those which restricted communication as part of a broader scheme of regulation59. The plaintiffs, it was submitted, failed at the threshold because the impugned laws were directed to keeping the Electoral Rolls up to date. Save for certain exceptional cases60, persons who complied with the duties imposed under s 101 of the CEA would not need to enrol or vary their enrolment when an election was called. The submission rested upon the premise that a change in a procedural or machinery law relating to elections which removes a pre-existing opportunity for enrolment by qualified persons does not require substantial justification. The premise, for the reasons already outlined, is not accepted. The submission must be rejected. The Commonwealth, nevertheless, sought to support the amendments as procedural laws "reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government". The fixing of some cut-off date for enrolment consequent upon the issue of writs for an election was appropriate and 59 Coleman v Power (2004) 220 CLR 1 at 52 [98] per McHugh J; [2004] HCA 39; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 200 [40] per Gleeson CJ, citing Levy v Victoria (1997) 189 CLR 579 at 618-619 per Gaudron J; [1997] HCA 31. 60 Persons who turn 18 between the issue of the writs and polling day who could, in any event, have applied under s 100 and have three days after the issue of the writs to enrol pursuant to s 102(4AB); persons granted citizenship between the issue of the writs and polling day who in any event may apply under ss 99B and 102(4AA) up to three days after the issue of the writs; persons who have recently moved and become entitled to transfer enrolment under s 99(2) between the close of Rolls and polling day. the imposition of the duty of enrolment; adapted to that end. The Commonwealth relied upon the legislative scheme in which the cut-off provisions find their place and which provides for: the precondition to enrolment requiring satisfaction on the part of the Electoral Commissioner that a person claiming to be entitled to be enrolled is so entitled; the elaborate procedure for the conduct of an election consequent upon the issue of the writs, which procedure is premised upon the prior closure and substantial correctness of the Rolls; and a bar on any challenge to an election based on an allegation of incorrectness of the Rolls. The Commonwealth submitted that the choice of one date rather than another as the cut-off date for enrolment following the issue of writs for an election was not something which would take the legislative scheme outside the bounds of what is appropriate and adapted to the relevant end. For the reasons already given, the characterisation of an electoral law as procedural, or in the nature of electoral machinery, does not of itself justify collateral damage to the extent of participation by qualified persons in the choice of their parliamentary representatives. The detriment, even if contributed to by the failure of those persons to fulfil their duties under the CEA, is still a detriment "of concern to the whole Commonwealth". It must be accepted, in considering the validity of the impugned laws, that Parliament has a considerable discretion as to the means which it chooses to regulate elections and to ensure that persons claiming an entitlement to be enrolled are so entitled. It is not for this Court to hold such a law invalid on the basis of some finely calibrated weighing of detriment and benefit. Nor is it the function of the Court to hold such a law beyond the power of the Parliament simply because the Court thinks there might be a better way of achieving the same beneficial purpose. What Latham CJ said in the First Uniform Tax Case is of general application and applies to this case61: "It is not for this or any court to prescribe policy or to seek to give effect to any views or opinions upon policy. We have nothing to do with the wisdom or expediency of legislation. Such questions are for Parliaments and the people." 61 South Australia v The Commonwealth (1942) 65 CLR 373 at 409; [1942] HCA 14. If a law subject to constitutional challenge is a law within the legislative competency of the Parliament that enacts it, the question whether it is a good law or a bad law is a matter for the Parliament and, ultimately, the people to whom the members of the Parliament are accountable. But where the Constitution limits the legislative power of a Parliament in any respect and where a question of the validity of a law is raised and has to be answered in order to determine a matter before the Court, then the Court must decide whether constitutional limits have been exceeded. It is necessary at this point to refer to the events which have led to these proceedings. Factual and procedural history On Saturday, 17 July 2010, the Prime Minister announced her intention to call a general election for the Senate and the House of Representatives. On the same day, her Excellency, the Governor-General, acting upon the advice of the Prime Minister, prorogued the Parliament from 4.59 pm on Monday, 19 July until Saturday, 21 August 201062. Writs were issued on 19 July for the election of members of the House of Representatives for the States and Territories and for the election of senators for the Territories by the Administrator in Council and for the election of senators for the States by their respective vice-regal representatives. The writs fixed 22 July 2010 for the closing of the Rolls, 29 July 2010 for the closing of nominations, 21 August 2010 for polling and on or before 27 October 2010 for the return of the writs. The plaintiffs are both students. Both are Australian citizens. The first plaintiff, Shannen Rowe, turned 18 on 16 June 2010. At the time the election was announced she was not enrolled to vote. A completed form was not lodged on her behalf until Friday, 23 July 2010. By operation of s 102(4) of the CEA, her claim for enrolment, having been lodged after 8 pm on the day of the issue of the writs, could not be considered until after the close of polling at the election. The second plaintiff, Douglas Thompson, was 23 years of age and was enrolled to vote for the Division of Wentworth at an address in that Division. However, in March 2010 he had moved to a new address in the Division of Sydney. Following an abortive attempt to lodge electronically a claim for transfer of his enrolment pursuant to s 101 of the CEA, he completed a form which he signed on 22 July and which was lodged by facsimile transmission with the AEC by his 62 Commonwealth of Australia Gazette, S136, 19 July 2010. solicitor. By virtue of s 102(4AA) of the CEA, however, his claim for transfer, having been lodged after 8 pm on the date of the close of the Rolls, could not be considered until after the close of polling at the election. Ms Rowe and Mr Thompson commenced proceedings in this Court on 26 July 2010 on their own behalf and as representative parties claiming a declaration that ss 102(4), 102(4AA) and 155 of the CEA are invalid. They also sought an order to show cause why writs of mandamus should not issue directed to the Electoral Commissioner in effect requiring that they be included on the Electoral Rolls for their respective Divisions. On 29 July 2010, Hayne J made an order pursuant to r 25.03.3(b) of the High Court Rules 2004 referring the proceedings for further hearing by a Full Court on Wednesday, 4 August 2010. The plaintiffs continued the proceedings on their own behalf and not in a representative capacity. They filed an amended application by leave. The parties also filed a statement of agreed facts. The Commonwealth Electoral Act 1918 The long title of the CEA is "An Act to Consolidate and Amend the Law relating to Parliamentary Elections and for other purposes". The provisions under challenge must be considered in the context of the legislative scheme of which they form part. The Act establishes the Australian Electoral Commission ("the AEC"), comprising a Chairperson, the Electoral Commissioner and one other member63. Among the functions of the AEC are64: "to provide information and advice on electoral matters to the Parliament, the Government, Departments and authorities of the Commonwealth". The AEC is required to prepare and forward to the Minister each year a report of its operations for the year ended 30 June65. Annual Reports of the AEC for the years 1998-1999 to 2008-2009 inclusive were referred to in the statement of agreed facts, which forms part of the Application Book. The AEC has also, from time to time, made submissions to the Joint Standing Committee on Electoral Matters ("the JSCEM"). A number of those submissions were also included in the Application Book in relation to inquiries conducted by the JSCEM into federal elections in 1998, 2004 and 2007. By the agreed facts, the authenticity of 63 CEA, s 6(1) and (2). 64 CEA, s 7(1)(d). 65 CEA, s 17(1). the reports and the submissions were accepted, as was, by specific agreement, the correctness of certain factual statements and tables contained in them. Reference to these reports and submissions in these reasons is made within the framework of the agreements about their use between the parties66. The Electoral Commissioner is the chief executive officer of the AEC67. There is an Australian Electoral Officer for each State68. There is a Divisional Returning Officer for each Electoral Division, whose duty it is to give effect to the Act "within or for the Division subject to the directions of the Electoral Commissioner and the Australian Electoral Officer for the State"69. Under Pt IV of the Act each State and the Australian Capital Territory are "distributed into Electoral Divisions" with one member of the House of Representatives to be chosen for each Division70. There is a provision for the redistribution of the Divisions in a State or the Territory71 and a requirement for monthly assessments of the number of persons enrolled in each Division, the average divisional enrolment and the extent to which the number of electors enrolled in each Division differs from that average72. A mini-redistribution can be undertaken after the issue of the writs for an election where the number of Divisions in a State differs from the number of members to which the State is entitled73. That process involves a consideration of the number of electors enrolled in the various Divisions within the State. The Rolls therefore have an important part to play in the redistribution process. Part VI of the CEA provides for a Roll of electors for each State and for each Territory74. Each of those Rolls is made up of the Rolls for the Divisions 66 Set out in the statement of agreed facts in the Application Book and a supplementary statement of agreed facts filed on 5 August 2010. 67 CEA, s 18. 68 CEA, s 20(1). 69 CEA, s 32(1); see also ss 18(3) and 20(3). 70 CEA, ss 56 and 57. 71 CEA, s 73. 72 CEA, s 58(1). 73 CEA, s 76. 74 CEA, s 81(1). within the State or Territory75. The Rolls are to contain the name and address of each elector and such further particulars as are prescribed76. Rolls can be inspected77 and information contained in them must be made available to specified classes of persons and organisations78. The AEC must conduct reviews of the Rolls with a view to ascertaining such information as is required for their preparation, maintenance and revision79. The AEC has, since 1999, used a process of data-matching, designated "Continuous Roll Update" ("CRU"), to maintain the Electoral Roll. By this process personal information on electors held by the AEC is matched with external data from other agencies and from some utility companies. Where data- matching indicates that an elector has become eligible or has changed his or her address, the AEC sends a letter to or visits the elector. This process can result in an enrolment or a transfer of enrolment occurring. Non-response to attempted communication can lead to the removal of the elector from the Roll under the objection process for which Pt IX provides80. The scale of the CRU undertaking is indicated by the fact that between 2000-2001 and 2004-2005 the AEC each year processed about four million records showing a change of address or likely eligibility to enrol. Targeted mail was sent to 2.8 million addresses each year. Field visits were made to 330,000 habitations annually. This activity generated about 850,000 enrolments annually. The result of the activity was more complete Electoral Rolls. There was, however, a much lower rate of return, in terms of enrolments, having regard to extra expenditure in 2007, compared with the return in 2004. During 1997, the AEC introduced enhancements to its computerised Roll Management System ("RMANS") in order to detect and deter fraudulent enrolment. The RMANS Address Register separately identifies each known 75 CEA, s 82(4). 76 CEA, s 83(1). Save for eligible overseas electors and itinerant electors, whose addresses are not required: s 83(2). 77 CEA, s 90A. 78 CEA, ss 90B-91B. 79 CEA, s 92(2). 80 The CRU process was described in a report dated 21 April 2010 prepared by the Australian National Audit Office on the AEC's preparation for, and conduct of, the 2007 federal general election. The contents of the report were agreed by the parties as an accurate statement of the AEC's CRU activities during the period described. address, based on known streets and localities, and lists a range of attributes for the address, including whether the address is habitable and valid for enrolment. The Register is then used to assess the validity of addresses listed on enrolment claims. Qualifications and disqualifications for enrolment and for voting are dealt with in Pt VII of the CEA. A key provision of Pt VII is s 93. It sets out conditions upon which persons "shall be entitled to enrolment"81. They are persons who have attained 18 years of age and who are Australian citizens82. Also entitled are non-citizens who would have been British subjects within the meaning of the relevant citizenship law had it continued in force and whose names were, before 26 January 1984, on a Roll83. An "Elector" is defined in s 4(1) as "any person whose name appears on a Roll as an elector" and whose name is on the Roll for a Division. An elector is "entitled to vote at elections of Members of the Senate for the State that includes that Division and at elections of Members of House of Representatives for that Division"84. Some classes of persons are not entitled to enrolment or to vote. The holders of temporary visas under the Migration Act 1958 (Cth) and unlawful non-citizens under that Act are not entitled to enrolment85. Persons who, by reason of being of unsound mind, are incapable of understanding the nature and significance of enrolment and voting and persons convicted of treason or treachery and not pardoned are not entitled to enrolment or to vote at any Senate election or election for the House of Representatives86. Also disqualified are persons serving a sentence of imprisonment of three years or longer87. Persons resident in Australia who are leaving Australia may be included on the Roll as eligible overseas electors88. Persons who have ceased to reside in 81 CEA, s 93(1). 82 CEA, s 93(1)(a) and (b)(i). 83 CEA, s 93(1)(b)(ii). 84 CEA, s 93(2). 85 CEA, s 93(7). 86 CEA, s 93(8). 87 CEA, s 93(8)(b) as it stood before its repeal in 2006 by amendments held invalid in Roach v Electoral Commissioner (2007) 233 CLR 162. 88 CEA, s 94. Australia and intend to resume residence within six years of ceasing may apply for enrolment and be enrolled89. Spouses, de facto partners and children of eligible overseas electors may apply for enrolment90. There is also provision for the enrolment of itinerant electors, a class which includes homeless persons91. There are cut-off provisions, preventing consideration of the enrolment of persons in some of these categories, which operate from 8 pm on the day that the writs have issued for an election92. The validity of the amendments which introduced these provisions was challenged by the plaintiffs in their further amended application. That was a necessary consequence of their challenge to the cut-off provisions affecting them, which are to be found in Pt VIII of the CEA. No objection was taken to their standing to do so. It was accepted that the cut-off provisions introduced by the Amendment Act would stand or fall together. Section 93 is made under two heads of constitutional power. The first is the power to make laws to prescribe the qualifications of electors93. The second is the power to make laws relating to the election of senators and members of the House of Representatives94. The two heads of legislative power are logically distinct. Nevertheless, laws prescribing electoral processes may validly impinge upon the entitlement to vote at an election. As already explained, the only proper purpose of such processes is to provide the means by which "the people" may choose the members of their Parliament. That statement of purpose is a generalisation of the rationale offered by Griffith CJ in Smith v Oldham for laws regulating the conduct of persons with regard to elections95: "The main object of laws for that purpose is, I suppose, to secure freedom of choice to the electors." The two heads of power was acknowledged by Gibbs CJ, Mason and Wilson JJ in R v Pearson; Ex parte logical distinction between the 89 CEA, s 94A. 90 CEA, s 95. 91 CEA, s 96. 92 CEA, ss 94A(4), 95(4) and 96(4). These cut-offs were introduced by Items 20, 24 and 28 in Sched 1 to the Amendment Act. 93 Constitution, s 51(xxxvi) read with ss 8 and 30. 94 Constitution, s 51(xxxvi) read with ss 10 and 31. 95 (1912) 15 CLR 355 at 358. Sipka96. The provision of the CEA there under consideration, to the extent that it impinged upon voting rights said to be protected by s 41 of the Constitution, was s 45(a). The latter section provided a cut-off for claims for enrolment and transfers of enrolment upon issue of the writs for an election. It was characterised by their Honours as a law relating to elections for members of the House of Representatives and senators97. It does not appear from the joint judgment of Brennan, Deane and Dawson JJ that their Honours, as the Commonwealth submitted in this case, treated s 45(a) as an aspect of the definition of The Commonwealth submitted that in any event the subject matters of qualification of electors and elections are not mutually exclusive. That may be accepted. A law may be a law with respect to both subject matters. But the class of law which defines the qualifications of electors, even if it extends to laws making enrolment a condition of entitlement to vote, does not extend to procedural laws prescribing cut-off dates for the lodgement of claims for enrolment or transfer of enrolment. the Commonwealth franchise under ss 8 and 30. Part VIII of the CEA sets up a system of compulsory enrolment. Every person who is entitled to be enrolled for any Subdivision, whether by way of enrolment or transfer of enrolment, and whose name is not on the Roll, is required to "forthwith fill in and sign a claim and send or deliver the claim to the Electoral Commissioner"98. The requirement does not apply to persons applying to be treated as eligible overseas electors under s 94 or their spouses, de facto partners or children. It does not apply to itinerant electors, nor to persons who have turned 16 and who are thereby eligible under s 100 of the CEA to lodge a claim in advance of turning 18. By operation of s 98AA99, certain classes of prospective electors, including those making claims as itinerant or overseas electors, are required to supply evidence of their identity. The methods of proof available are specified in sub-s (2) and in regs 11A and 12 of the Electoral and Referendum Regulations 1940 (Cth). Subject to an immaterial exception, a person whose name is not on the Roll on the expiration of 21 days from the date upon which the person became so 96 (1983) 152 CLR 254. 97 (1983) 152 CLR 254 at 265. 98 CEA, s 101(1). 99 Section 98AA was inserted into the CEA by the Amendment Act (Item 29 in Sched 1) but was repealed and its present form substituted by the Electoral and Referendum Amendment (Modernisation and Other Measures) Act 2010 (Cth) (Item 6 in Sched 2). entitled is guilty of an offence unless he or she proves that the non-enrolment was not the result of a failure to send a completed claim to the Electoral Commissioner100. There is also an offence committed when a person changes his or her address within a particular Subdivision and does not give notice of the new address within 21 days to the Electoral Commissioner101. Failure to comply with the obligations under s 101 constitutes an offence punishable on conviction by a fine not exceeding one penalty unit. There is, however, a saving provision in s 101(7), which provides: "Where a person sends or delivers a claim for enrolment, or for transfer of enrolment, to the Electoral Commissioner, proceedings shall not be instituted against that person for any offence against subsection (1) or (4) committed before the claim was so sent or delivered." The obligations imposed by s 101 apply to first-time claimants for enrolment on any Roll, persons effecting transfer of enrolment from one Subdivision to another and persons changing their address within one Subdivision. The offence provisions are an incentive to enrolment and to discharge of the statutory duty to enrol and ultimately to vote. Their primary character as an incentive is apparent from the immunity from prosecution conferred by s 101(7) when a person has sent or delivered a claim for enrolment or transfer of enrolment to the Electoral Commissioner. They are designed not to punish, but to encourage maximum participation by persons qualified to vote. Where the Electoral Commissioner receives a claim for enrolment or transfer of enrolment and the claim is in order, the Commissioner is required by s 102(1)(b) to enter the name of the claimant on the Roll together with other necessary particulars. The claimant is also to be notified in writing of the enrolment. Sub-sections (4) and (4AA) of s 102 apply in the present case to the first and second plaintiffs respectively. The validity of the amendments to the CEA which introduced those sub-sections is under challenge. The sub-sections are in the following terms: If a claim by a person for enrolment under section 101 … is received during the period: beginning at 8 pm on the date of the writ or writs for an election for the Division to which the claim relates; and ending at the close of the polling at the election; 100 CEA, s 101(4). 101 CEA, s 101(5) and (6). then the claim must not be considered until after the end of the period. (4AA) If a claim by a person for transfer of enrolment under section 101 … is received during the period: beginning at 8 pm on the date of the close of the Rolls for an election for the Division to which the claim relates; and ending at the close of the polling at the election; then the claim must not be considered until after the end of the period." Where a claim is delayed by reason of delay in the delivery of mail caused by an industrial dispute, then the claim shall be regarded as having been received before the commencement of the cut-off periods referred to in sub-s (4) or sub-s (4AA) as the case requires102. Sub-sections (4) and (4AA) of s 102 are to be read in the light of Pt XIII of the CEA, which is concerned, inter alia, with the issue of writs for elections, the dates for the close of the Rolls, nomination, polling and the return of the writs. The close of the Rolls is dealt with by s 155: "155 Date for close of Rolls The date fixed for the close of the Rolls is the third working day after the date of the writ. In this section: working day means any day except: a Saturday or a Sunday; or a day that is a public holiday in any State or Territory." The validity of the 2006 amendment to s 155 is challenged in these proceedings. The date fixed for nomination of the candidates is required to be not less than 10 days nor more than 27 days after the date of the writ103. The date fixed 102 CEA, s 102(4A) and (4B). 103 CEA, s 156(1). for polling is to be not less than 23 days nor more than 31 days after the date of nomination104. The date fixed for the return of the writ is to be not more than 100 days after the issue of the writ105. The effect of s 102(4) is that a person lodging a claim for enrolment cannot have the claim considered until after the election if it was lodged after 8 pm on the day that the writs issued. The effect of s 102(4AA), read with s 155, is that a person seeking transfer of enrolment because of a change of address has three days only from the date of the issue of the writs to lodge his or her claim. Part IX of the Act provides for objections to be made to the enrolment of a person on the Electoral Roll106. The Electoral Commissioner, however, cannot remove an elector's name from the Roll during the period between 8 pm on the date of issue of the writs for an election and the close of polling for that election107. The Commonwealth in its submissions pointed to the effects of the pre-amendment law on the Electoral Commissioner's ability to process objections. In this connection it should be noted that s 106 empowers the Electoral Commissioner, at any time between the date of issue of the writ for an election for a Division and before the close of polling at that election, to remove from the Roll the name of a person who secured enrolment pursuant to a claim in which the person made a false statement. That power does not depend upon the application of the objection process. It is now necessary to review briefly the history of cut-off provisions prior to the Amendment Act. Enrolment cut-offs: 1902-2006 The Commonwealth Electoral Act 1902 was described in its long title as "An Act to regulate Parliamentary Elections". It conferred the entitlement to enrolment on "[a]ll persons qualified to vote at any Election for the Senate or House of Representatives, or who would be qualified so to vote if their names were upon a Roll"108. There was a cut-off provision in s 64. Claims for enrolment and transfer of enrolment lodged before the issue of the writs for an 104 CEA, s 157. 105 CEA, s 159. 106 CEA, s 114. 107 CEA, s 118(5). This provision was altered by the Amendment Act. Prior to amendment, the period during which the removal of names from the Rolls was precluded ran from seven days after the date of the writs. 108 Commonwealth Electoral Act 1902, s 31. election could be processed after the issue of the writs but otherwise no addition or alteration was to be made to the Rolls between the issue of the writs and the close of polling. As enacted the CEA, which consolidated and amended the law relating to parliamentary elections, contained a similar although not identical cut-off provision. Claims for enrolment or transfer which were received after 6 pm on the day of the issue of the writs for an election would not be registered until after close of polling109. Until 1983 the CEA continued to provide that the Electoral Rolls closed on the date of issue of the writs. There was, however, an executive practice, which developed at least from the 1930s, of announcing the election some days before the Governor-General was asked to dissolve Parliament and issue writs for the election of the members of the House of Representatives110. The time between the announcement and the issue of the writs varied, after 1934, from a minimum of five days in 1949 to a maximum of 63 days in 1958. In 1983 there was a departure from that practice. The election was announced on the afternoon of the day before the issue of the writs. It was that late announcement, coupled with the operation of s 45(a) (the cut-off provision of the CEA then in force), that led to the litigation in this Court in R v Pearson; Ex parte Sipka111. Murphy J referred to the background in his dissenting judgment112: "The effect of the circumstances in which this election was called is that many persons who were entitled to be but were not enrolled on the Commonwealth roll by 6 pm on 4 February 1983 are, apart from s 41 of the Constitution, prevented from enrolling and voting in this election because of s 45(a) of the Commonwealth Electoral Act." The CEA was amended by the Commonwealth Electoral Legislation Amendment Act 1983 (Cth). The cut-off point for consideration of claims for enrolment or transfer of enrolment was extended beyond the date of issue of the writs to the date of close of the Rolls113. The date fixed for close of the Rolls was to be seven days after the date of issue of the writs114. The Second Reading 109 CEA, s 45(a) (as enacted in 1918). 110 Constitution, s 32. 111 (1983) 152 CLR 254. 112 (1983) 152 CLR 254 at 266-267. 113 Commonwealth Electoral Legislation Amendment Act 1983, s 29. 114 Commonwealth Electoral Legislation Amendment Act 1983, s 45. Speech for the amending legislation described one of its objectives as "to make it easier for electors to get on the rolls and stay on the rolls … For example, the Bill provides that there must be a sufficient time between the announcement of an election and the close of rolls for that election."115 The seven-day period of grace then introduced operated for eight subsequent federal elections until the amendments under challenge in these proceedings. Before it was amended in 2006, s 102 of the CEA precluded consideration, until after the close of polling, of a claim for new enrolment received after 8 pm on the day on which the Rolls for the election were to close. Section 155, as it then stood, provided that the date fixed for the close of the Rolls was seven days after the date of the writs. The effect of s 102, read with s 155, was that a person, qualified as an elector, had seven days after the issue of the writs to lodge a claim for enrolment and thus be placed on the Roll. The position of a person seeking a transfer of enrolment was the same. The challenged amendments were effected by s 3 of the Amendment Act, read with various items specified in Sched 1 to that Act. The amendment, by repeal and substitution, of s 102(4) and the insertion of s 102(4AA) were effected by Item 41 in Sched 1. The amendment of s 155 was effected by repeal and substitution under Item 52 in Sched 1. Operation of the cut-off: 1983-2006 AEC records for the period 1993-2006 show the number of new enrolments, re-enrolments and transfers of enrolment undertaken during the grace period after the issue of the writs. The number of such transactions represented well in excess of 350,000 electors in each of the 1993, 1996, 1998 and 2001 elections. For each of the 1998 and 2001 elections the number of new enrolments and re-enrolments increased daily during the seven-day period (save for Saturdays and Sundays). In 2004, the close-of-Rolls transactions represented 17.5 per cent of total enrolment activity for the 2004-2005 financial year. Of 520,086 close-of-Rolls transactions, 265,513 enrolment cards were received from voters whom the AEC had contacted in the 12 months prior to the election. Following the Amendment Act the post-announcement grace period for the 2007 election was three days for new enrolments and nine days for updating existing enrolments. those periods 279,469 enrolment transactions. Some 100,370 people lodged their claims for enrolment or transfer of enrolment after the close of the Rolls. There were 115 Australia, House of Representatives, Parliamentary Debates (Hansard), 2 November 1983 at 2216. The AEC reported to the Australian National Audit Office ("the ANAO"), following the 2007 election, that it had faced a far greater challenge in 2007 due to the shortened close of the Rolls. It was not able to rely upon its previous strategy, used in 2004, which involved advertising when the election was called and drawing attention to the seven-day close-of-Rolls period. The AEC also reported that in 2007 it had achieved "a small gain in enrolment efficiency measured by transaction". The gain was expensive. About $36 million was spent on enrolment activity, including advertising, before the 2007 election. The marginal cost of each of the net additional 118,885 enrolments in 2007 was over $216, nearly seven times the unit cost per additional enrolment in 2004. As to the problem of electoral fraud, the AEC stated, in a submission to the JSCEM in October 2000, that "identity fraud is not a significant problem in the federal electoral system". The AEC observed: "Apart from the lack of evidence available to the AEC of any widespread and organised conspiracy involving identity fraud … it must be acknowledged that there are very significant difficulties in organising an identity fraud conspiracy of sufficient magnitude to affect the result in a federal Division". In the event, it was not submitted for the Commonwealth that the justification for the amendments, so far as it was based upon the prevention of fraud, was other than prophylactic. That is to say, the amendments were not introduced as a reaction to an existing problem of identity fraud in connection with enrolments. It is apparent from the agreed facts that, as would be expected, the effect of the cut-off provisions enacted in 2006 was greater with respect to newly qualified electors than electors in older age groups. The percentage of eligible persons in the age range 18-25 who were not enrolled as at 30 June 2006 and 30 June 2007 was significantly greater than the percentage of the total number of eligible voters who were not enrolled at those dates. As at 15 April 2010, there were approximately 430,000 eligible young people who were not enrolled to vote. It was also an agreed fact that people living in remote and rural areas of Australia may have difficulty enrolling because of limited access to the facilities and services necessary for enrolment. Other agreed facts were before the Court in relation to claims for enrolment in connection with the 2010 election. They were set out in an affidavit sworn by Paul Dacey, Deputy Electoral Commissioner in the AEC: 508,000 claims for enrolment and transfer of enrolment were received after the announcement of the election and before the deadlines for enrolment claims. Those claims were processed onto the Rolls by 27 July There were estimated to be approximately 100,000 claims for enrolment received after the cut-off deadlines, but before the date for the closing of the Rolls prior to the Amendment Act. That estimate was based on preliminary advice from State Managers at close of business on 27 July 2010, albeit it was subject to a considerable margin of uncertainty. Mr Dacey indicated that if a requirement to process late claims for enrolment and transfer of enrolment were made known to the AEC by 6 August 2010, it would be able to process them. It would have to deploy additional staff and the deployment would cause some level of disruption. An electronic version of the Roll would be able to be completed by 18 August 2010. The AEC would write to electors who had made late claims once their applications had been processed onto the Roll and advise that they would be able to cast a provisional vote at a polling place on polling day. Their names would not appear on the certified lists, which are the printed lists of voters for each Division required by s 208 of the CEA. Those lists would have been finalised and sent for printing. This would not prevent electors who enrolled late from exercising their vote, nor would it interfere with processes of preliminary scrutiny of declaration votes116 as those requirements could be met by utilising the electronic Roll. The justification for the Amendment Act The Bill which became the Amendment Act was said, in the Second Reading Speech, to contain "reform measures arising from some of the government supported recommendations of the Joint Standing Committee on Electoral Matters' report on the 2004 federal election, which was tabled in the parliament in October 2005, and additional reform measures considered a priority by the government"117. The Speech did not otherwise set out the objectives or rationale of the amendment. The Explanatory Memorandum did not add anything relevant for present purposes. 116 Declaration votes comprise postal votes, pre-poll declaration votes, absent votes and provisional votes: CEA, s 4(1). 117 Australia, House of Representatives, Parliamentary Debates (Hansard), 8 December 2005 at 19. The report of the Joint Standing Committee on Electoral Matters on the 2004 federal election118 ("the JSCEM Report"), referred to in the Second Reading the Explanatory Memorandum, contained a number of Speech and recommendations. One was that s 155 be amended to provide that the date and time fixed for the close of the Rolls be 8 pm on the day of the writs119. The objective of and rationale for the amendment was set out at pars 2.112 to 2.126 of the Committee's report. In those paragraphs, the Committee made the following points: (iii) The AEC had processed approximately 17.5 per cent of enrolment transactions in 2004-2005 during the close of Rolls for the 2004 federal election, a period representing only three per cent of the available working time for the year120. The volume of transactions during the close-of-Rolls period limited the AEC's ability to conduct the thorough and appropriate checks required to ensure that the Rolls were updated with integrity121. If electors had enrolled or changed their enrolment details at the time that their entitlement changed, 60.5 per cent of enrolment transactions during the close-of-Rolls period would not have been required122. (iv) The seven-day close-of-Rolls period for federal elections actually encouraged electors and potential electors to neglect their obligations in respect of enrolment, believing they could play "catch up" during the close-of-Rolls period. It thereby decreased the accuracy of the Rolls123. (v) A significant number of electors failed to update enrolment details in the 12 months before the 2004 election writs were issued despite contact and prompting from the AEC up to 12 months before the election was announced. These electors were later responsible for a large proportion of 118 Australia, The Parliament, Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005). 119 JSCEM Report at 36 [2.127]. 120 JSCEM Report at 34 [2.112]. 121 JSCEM Report at 34 [2.113]. 122 JSCEM Report at 34 [2.114]. 123 JSCEM Report at 35 [2.116]-[2.117]. the enrolment transactions that the AEC was required to process during close of Rolls124. (vi) AEC statistics indicated that, despite AEC efforts and significant taxpayer funds expended in contacting electors prior to elections being announced, that pattern was repeated election after election125. (vii) Electors act unlawfully in not enrolling when entitled and also cause wastage of a significant amount of taxpayer funds expended on postage and other measures in repeated attempts to persuade them to update their details on the Electoral Roll126. (viii) Current close-of-Rolls arrangements present an opportunity for those who seek to manipulate the Rolls to do so at a time where little opportunity exists for the AEC to undertake the thorough checking required to ensure Roll integrity127. (ix) The fundamental issue was to prevent such fraud before it was able to occur. Failure to do so would amount to neglect128. The change, along with the introduction of proof of identity and address measures for enrolment and provisional voting would ensure the Electoral Roll retained a high degree of accuracy and integrity, while reminding electors that the responsibility for ensuring that the Electoral Roll is updated in a timely manner rests with them129. Contentions and conclusions The principal Commonwealth submissions in respect of validity, which assumed no relevant distinction between a disqualifying electoral law and a "procedural" electoral law, may be summarised as follows: 124 JSCEM Report at 35 [2.118]. 125 JSCEM Report at 35 [2.119]. 126 JSCEM Report at 35 [2.120]. 127 JSCEM Report at 35 [2.121]. 128 JSCEM Report at 35 [2.123]. 129 JSCEM Report at 36 [2.126]. The issue in relation to the validity of the impugned provisions was in substance, according to the Commonwealth, whether their effect on the ability of some persons to cast a vote in an impending election was disproportionate to the end that they served. In light of the preceding discussion that submission is not controversial. It was not a necessary condition of the validity of the impugned provisions, so the submission went, that there be evidence of a pre- existing mischief, such as electoral fraud, to which they were directed. That submission can be accepted. However the presence or absence of evidence of an existing mischief may be relevant in ascertaining whether the detriment imposed by a law which disentitles qualified persons from enrolment is disproportionate to the benefit to be derived in terms of the constitutional mandate. The benefits derived from the earlier cut-off dates were said to include the smooth and efficient conduct of elections effected by: enhancement of the accuracy of the Roll between elections by encouraging timely enrolment and updating; consequential saving of AEC resources otherwise spent on attempts to persuade people to enrol; and (iii) consequential reduction of the diversion of AEC resources into processing of late claims for enrolment and transfer. The possibility that the amendments could yield such benefits can be accepted. The Constitution, it was submitted, has always allowed the executive a degree of control over the time that elapses between the announcement of an election and the issue of the writs. The impugned provisions, it was said, do not affect that power. That submission can also be accepted. However, a key difficulty in this case is that the impugned provisions remove a statutory grace period incapable of being affected by the executive discretion as to the timing of the announcement of the election. The Commonwealth also submitted that, on the plaintiffs' argument, either the pre-1983 provisions were invalid or their validity was somehow conditioned upon executive practice. It is not clear that the plaintiffs' argument has that consequence. In any event, when attention is focussed, as it ought to be, upon the alterations effected by the law to existing opportunities to enrol and to update enrolment rather than the search for a baseline of validity, the Commonwealth's submission is beside the point. The integrity of the Rolls was said to be enhanced by the impugned provisions in two ways: ensuring that people who should be on the Roll are on it; and ensuring that people who should not be on the Roll are not included. The Commonwealth submitted that the latter aspect of the integrity of the Rolls is enhanced because the AEC would have more time to process enrolment applications before polling day. Again, these benefits may be accepted as outcomes to which the amendments are directed. The Commonwealth submitted that differential effects of the impugned provisions on different sections of the community neither affect characterisation of the impugned provisions nor indicate a purpose of disenfranchising those sections. The defining characteristic of those excluded was said to be that they failed to comply with their obligations to enrol and effect transfer of their enrolments. In my opinion there is no basis for inferring any discriminatory purpose underlying the Amendment Act. Moreover, it is not necessary to the disposition of this case to consider the significance of the differential operation of the impugned provisions upon particular groups. This does not exclude the possibility that operational discrimination, effected by an electoral law, in relation to the acquisition and exercise of voting entitlements could be relevant to the validity of such a law. The Commonwealth also contended that differential effects of the impugned provisions on people living in remote areas were simply one aspect of the difficulties that face people living in such areas and would not affect characterisation of the impugned provisions. The cut-off for itinerant and homeless people, it was said, had not been shown to impose a "significantly different burden" on them from that imposed on other persons. So much can be accepted but the effect of the earlier cut-off upon people living in remote areas and itinerant and homeless people is to be considered as one of the practical consequences of the impugned provisions. The plaintiffs in reply to the Commonwealth contended that the statements made by the JSCEM in its report were not a substitute for evidence and could not establish a legitimate end for the impugned provisions when the material from independent authorities such as the AEC and the ANAO were to the contrary. This submission must be rejected. The rationale advanced by the JSCEM for amendment to the law was, in effect, incorporated by reference into the Second Reading Speech for the Amendment Act. To the extent that the purposes identified in the report fell within the scope of the constitutional mandate, it is not a condition of the validity of the legislation that those recommendations were based upon findings or assumptions of fact. The ends identified by the JSCEM were legitimate in terms of the constitutional mandate. But for the reasons already given that conclusion does not end the inquiry as to validity. Importantly, there was nothing to support a proposition, and the Commonwealth did not submit otherwise, that the impugned provisions would avert an existing difficulty of electoral fraud. Nor was there anything to suggest that the AEC had been unable to deal with late enrolments. Indeed, it had used the announcement of an election, coupled with the existence of the statutory grace period, to encourage electors to enrol or apply for transfer of enrolment in a context in which its exhortations were more likely to be attended to and taken seriously than at a time well out from an election. The plaintiffs, in their submissions, pointed to existing mechanisms to ensure the integrity and accuracy of the Rolls. These included the CRU process, the RMANS Address Register and more stringent proof-of-identity requirements introduced in connection with the 2006 amendments and reflected in s 98AA of the CEA and regs 11A and 12 of the Electoral and Referendum Regulations The constitutional legitimacy of measures calculated to ensure that people who are not entitled to vote do not vote was, of course, accepted by the plaintiffs. They pointed, however, to the absence of any evidence of the existence prior to the Amendment Act of a significant number of persons voting who were not entitled to vote. They contrasted that absence with the evidence of the effect of the impugned provisions in preventing an estimated 100,000 citizens from being enrolled or transferring their enrolment. The legal effect of the impugned provisions is clear. They diminish the opportunities for enrolment and transfer of enrolment that existed prior to their enactment. These were opportunities that had been in place as a matter of law for eight federal elections since 1983. They were consistent with an established executive practice which provided an effective period of grace for nearly 50 years before 1983. The practical effect of the Amendment Act was that a significant number of persons claiming enrolment or transfer of enrolment after the calling of an election could not have their claims considered until after the election. That practical effect cannot be put to one side with the observation, which is undoubtedly correct, that those persons were so affected because of their own failures to claim enrolment or transfer of enrolment in accordance with their statutory obligations. The reality remains that the barring of consideration of the claims of those persons to enrolment or transfer of enrolment in time to enable them to vote at the election is a significant detriment in terms of the constitutional mandate. That detriment must be considered against the legitimate purposes of the Parliament reflected in the JSCEM Report. Those purposes addressed no compelling practical problem or difficulty in the operation of the Rather electoral system. its enhancement and they were directed improvement. In my opinion, the heavy price imposed by the Amendment Act in terms of its immediate practical impact upon the fulfilment of the constitutional mandate was disproportionate to the benefits of a smoother and more efficient electoral system to which the amendments were directed. For the preceding reasons, I joined in the order made on 6 August 2010. I agree also that the application should be otherwise dismissed. Bell GUMMOW AND BELL JJ. This proceeding in the original jurisdiction of the Court was instituted on 26 July 2010, seven days after the issue of writs for a general election to be held on Saturday 21 August 2010. The first plaintiff, Ms Rowe, is an Australian citizen who attained the age of 18 years on 16 June 2010 and desires to vote in the general election. The second plaintiff, Mr Thompson, is an Australian citizen aged 23 who was enrolled to vote at an address in the Electoral Division of Wentworth in the State of New South Wales. In March 2010 he moved to an address in the Electoral Division of Sydney but, prior to 22 July 2010, did not advise the Australian Electoral Commission ("the Commission") and seek the transfer of his enrolment. He also wishes to vote at the general election and to do so in the Electoral Division of Sydney. The second defendant is the Commonwealth of Australia and the first defendant the Electoral Commissioner, who is the chief executive officer of the Commission, pursuant to the provisions of the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act"). The Commission is established by s 6 of that statute. The term "Elector" is defined in s 4(1) as a person whose name appears as an elector on an Electoral Roll. Part VI (ss 81-92) of the Electoral Act provides that there be a Roll of electors for each State and for each of the Territories (s 81), with a Roll for each Electoral Division for the election of a member of the House of Representatives130, and for each Subdivision of an Electoral Division (s 82)131. A central feature of the system for the polling established by Pt XVI (ss 202A-245) of the Electoral Act is the receipt by the elector of a ballot paper and the marking of the vote in private (ss 231-233). The secrecy which attends this system makes the description "compulsory attendance" more appropriate than "compulsory voting", though the latter often is used. Part XVI also provides for provisional votes (s 235) and Pt XV (ss 182-200) provides for postal voting. Amendments were made to the Electoral Act by the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth) ("the 2006 Act")132. Each plaintiff would be entitled to vote at the pending 130 See definition of "Division" in s 4(1). 131 There are currently no Subdivisions in use. However, s 4(4) of the Electoral Act provides that where a Division is not divided into Subdivisions, a reference in the Electoral Act to a Subdivision shall be read as a reference to a Division. 132 The 2006 Act (Sched 1, Items 102-139) also repealed and substituted or amended provisions of the Referendum (Machinery Provisions) Act 1984 (Cth). No challenge is made by the plaintiffs to the validity of any of these provisions of the 2006 Act. Bell the position by claiming enrolment and general election if named on the relevant Electoral Roll maintained under the Electoral Act (s 93(1), (2)). Neither plaintiff was so named on Monday 19 July 2010 when the writs for the general election were issued but both sought to rectify transfer of enrolment, respectively, within the seven day period after the issue of the writs. Their claims would have been well made under the provisions of the Electoral Act as the statute stood before the 2006 Act. However, the provisions of the Electoral Act as they have stood since the amendments made by the 2006 Act, if they are valid, would operate to close the Electoral Roll against the plaintiffs pending the holding of the general election on 21 August 2010. The Roll closed at 8pm on Monday 19 July for claims to new enrolments and at 8pm on Thursday 22 July for claims to transfers of enrolment. The evidence given for the Electoral Commissioner estimated that possibly as many as 100,000 claims for enrolment were in the same position as those made by the plaintiffs. In this Court the plaintiffs sought to establish the invalidity of the repeal effected by the relevant provisions of the 2006 Act. By order of a Justice of this Court made on 29 July 2010 the proceeding was referred for further hearing by the Full Court on a Statement of Agreement Facts. At the hearing on 4 and 5 August 2010 the Attorney-General for the State of Western Australia intervened in support of the validity of the legislation. At 12 noon on 6 August 2010 the Court, by majority, declared that certain Items133 of Sched 1 to the 2006 Act are invalid. These Items were expressed to repeal particular provisions of the Electoral Act then in force. The effect of the declaration of invalidity is that those Items were ineffective to achieve that repeal so that the statute, as it stood before that ineffective repeal, has remained in force134. The Court ordered that the Commonwealth pay the costs of the plaintiffs. The evidence on behalf of the Electoral Commissioner, and submissions by counsel, indicated that if the declaration were made by the Court on 6 August the expectation would be that the electronic roll referred to in s 111 of the Electoral Act would be completed by 18 August and the postal and provisional voting systems utilised as the need arose for the conduct of the polling on 133 Items 20, 24, 28, 41, 42, 43, 44, 45 and 52. 134 Roach v Electoral Commissioner (2007) 233 CLR 162 at 202-203 [96]-[97]; [2007] HCA 43. Bell 21 August. Accordingly, and the contrary was not suggested, there was utility in the Court making the declaration on 6 August. What follows are our reasons for joining in the making of that order. The electoral structure Further consideration of the circumstances giving rise to the litigation requires attention to several provisions of the Constitution and of the Electoral Act. Section 5 of the Constitution provides that by Proclamation the Governor-General may prorogue the Parliament and dissolve the House of Representatives and that after any general election the Parliament shall be summoned to meet not later than 30 days after the day appointed for the return of the writs. Section 32 is an important provision for the setting of the steps in the conduct of a general election. It states: "The Governor-General in Council may cause writs to be issued for general elections of members of the House of Representatives. After the first general election, the writs shall be issued within ten days from the expiry of a House of Representatives or from the proclamation of a dissolution thereof." Section 32 thus so operates that from one general election to another the period between the proclamation of a dissolution and the issue of the writs may vary, and with that variation, so also the period for an immediate appreciation by the public of the pendency of a general election. It appears that in 1914 the writs were issued on the same day as the proclamation of the dissolution, that this occurred again in 1983, and that on other occasions there have been longer intervals135. As will appear below, in the case of the general election called for 21 August 2010, the interval was that between Saturday 17 July and Monday 19 July. In their submissions the plaintiffs sought to attach some stigma to the exercise of power by the Governor-General in Council under s 32 to achieve a shorter rather than a longer interval between proclamation of a dissolution and the issue of writs. That which the Constitution plainly permits cannot be a subversion of its operation. Any consideration of what is required of the Parliament in enacting legislation to provide for chambers "directly chosen by the 135 See R v Pearson; Ex parte Sipka (1983) 152 CLR 254 at 266; [1983] HCA 6. Bell people" must allow for the exercise by the executive of the authority conferred by s 32 in accordance with its terms. Section 32 deals with general elections for members of the House. With respect to the Senate the issue of writs depends partly upon the Constitution and partly upon legislation. Section 12 of the Constitution relevantly states: "The Governor of any State may cause writs to be issued for elections of senators for the State." The practice is for those Governors to fix times and polling places identical with those for elections for the House of Representatives, the writs for which having the been Constitution136. in Council under s 32 of the Governor-General issued by Section 43 of the Electoral Act requires that an election for the senators for the Australian Capital Territory and for the Northern Territory ("the Territories") be held at the same time as each general election. Section 13 of the Constitution provides a system for rotation of senators for the States and requires that an election to fill vacant places be held within one year before they become vacant and that the term of service of these senators begin on 1 July following the date of the election. The term of service of a senator for the Territories commences on the day of election and expires at the close of the day immediately before the polling day for the next general election (s 42 of the Electoral Act). Section 151 of the Electoral Act states: "(1) The Governor-General may cause writs to be issued for elections of Senators for Territories. The writs for the elections of Senators for Territories in accordance with section 43 shall be issued within 10 days from the expiry of the House of Representatives or from the proclamation of a dissolution of the House of Representatives." In this way, s 151 of the Electoral Act, with respect to senators for the Territories, synchronises the system for the issue of writs with that prescribed by s 32 of the Constitution for general elections for members of the House of Representatives. 136 Odgers' Australian Senate Practice, 12th ed (2008) at 94. Bell Section 47 of the Constitution states: "Until the Parliament otherwise provides, any question respecting the qualification of a senator or of a member of the House of Representatives, or respecting a vacancy in either House of the Parliament, and any question of a disputed election to either House, shall be determined by the House in which the question arises." The Parliament makes such provision by Pt XXII (ss 352-381) of the Electoral Act, which establishes the Court of Disputed Returns. Section 361(1) requires that the Court not inquire "into the correctness of any Roll", although it may "inquire into the identity of persons, and whether their votes were improperly admitted or rejected, assuming the Roll to be correct". It is this electoral structure, created partly by the terms of the Constitution itself and partly by legislation, which provided the foundation for the taking of the steps now described for the conduct of a general election for 21 August 2010. The calling of the general election for 21 August 2010 On Saturday 17 July 2010, Her Excellency the Governor-General, acting under s 5 of the Constitution, issued a proclamation under the Great Seal of Australia, counter-signed by the Prime Minister. The proclamation prorogued the Parliament from 4.59pm on Monday 19 July 2010 until Saturday 21 August 2010 and dissolved the House of Representatives with effect at 5.00pm on Monday 19 July 2010137. On Monday 19 July 2010, Her Excellency the Governor of New South Wales, having assumed the the administration of Commonwealth under s 4 of the Constitution138 and acting as Administrator in Council pursuant to the Constitution and under the Electoral Act, issued writs for the election of members of the House of Representatives for the States and the Territories and for the election of senators for the Territories139. For the purposes of those elections Her Excellency fixed the following dates: the government of 137 Commonwealth of Australia Gazette, S136, 19 July 2010. 138 Commonwealth of Australia Gazette, S137, 19 July 2010. 139 Commonwealth of Australia Gazette, S139, 20 July 2010. Bell For the close of rolls For the nominations 22 July 2010 29 July 2010 For the polling 21 August 2010 For the return of the writs On or before 27 October 2010 Section 152(1) of the Electoral Act stipulated that the writs fix the dates for the close of the Electoral Rolls maintained under that statute, and for the nomination, the polling and the return of the writ. Succeeding provisions space the times which may be fixed for each of these steps. Item 52 of Sched 1 to the 2006 Act, the validity of which has been successfully challenged in this litigation, purported to insert a new s 155 into the Electoral Act which fixed the date for the closing of the Rolls as the third working day after the date of the relevant writ. Item 41, the validity of which also was successfully challenged, repealed s 102(4) and inserted provisions which required the deferral until after the election of claims to enrolment received during the period beginning at 8pm on the date of the writ, and of claims for transfer of enrolment received during the period beginning at 8pm on the date for the close of the Rolls. Sections 156 and 175 provide for the closing of nominations at 12 noon not less than 10 days nor more than 27 days after the date of the writ. The date of polling must be a Saturday which is not less than 23 days nor more than 31 days after the date of nomination (ss 157 and 158). The writs must be returned not more than 100 days after issue (s 159). As already indicated, s 5 of the Constitution requires that the meeting of the new Parliament must occur not later than 30 days after the day appointed for the return of writs. On 19 July 2010, that is to say on the same day as Her Excellency the Administrator issued writs for the election of members of the House of Representatives and for the Territory senators, Vice Regal representatives in each of the States fixed dates for the election of State senators140. The spacing of and the dates for the steps for each election, beginning with the issue of the writ, 140 New South Wales Government Gazette, SS93, 19 July 2010; Victoria Government Gazette, S286, 19 July 2010; Queensland Government Gazette, E101, 19 July 2010; South Australian Government Gazette, EG47, 19 July 2010; Western Australian Government Gazette, S140, 20 July 2010; Tasmanian Government Gazette, No 21 074, 19 July 2010. Bell corresponded with that already indicated for the election of members of the House of Representatives and senators for the Territories. By force of s 152(2) of the Electoral Act and s 37 of the Acts Interpretation Act 1901 (Cth), the writs issued on 19 July 2010 were deemed to have been issued on that day at 6pm on the standard or legal time in the State or part of the Commonwealth in which they were issued. The writs were addressed, as required by Sched 1 to the Electoral Act, to the Australian Electoral Officer for each State (in the case of State senators), the Australian Electoral Officer for each Territory (in the case of Territory senators) and the Electoral Commissioner (in the case of elections for the House of Representatives) and each commanded these officials to ensure that the election in question "be made according to law". Provision for the offices held by these officials is made by Pt II (ss 5-38) of the Electoral Act. There is an Australian Electoral Officer for each State (s 20), and an Australian Electoral Officer for the Australian Capital Territory appointed for the purposes of each election (s 30). The Australian Electoral Officers for each State are subject to the directions of the Electoral Commissioner (s 20(1)). There is also a Divisional Returning Officer for each Division who is subject to the directions of the Electoral Commissioner and, in the case of each State, to the directions of the Australian Electoral Officer for the State (s 32). The effect of the declaration made by this Court is that if the relevant officials are to ensure that the elections identified in the writs issued on 19 July are to "be made according to law" as the writs require, this must be on the footing that the date fixed for the close of the Rolls was not 22 July 2010, as stated in the writs, but seven days after the date of the issue of the writs. Part XIX (ss 283-286) of the Electoral Act deals with the return of the writs after the ascertainment of the result of the relevant election. Section 285 provides for the remedy by proclamation of "errors" in the preparation of rolls, writs, ballot papers and voter lists. Section 286 empowers the person causing a writ to be issued to make provisions, by notice published in the Gazette, meeting any difficulty which might otherwise interfere with the due course of the election; any provision so made shall be valid and sufficient and any date provided in lieu of a date fixed by the writ shall be deemed to be the date so fixed. Bell Direct choice by the people, qualification of electors and method of choice – the Constitution With respect to the Senate, s 7 of the Constitution stipulates that it: "shall be composed of senators for each State, directly chosen by the people of the State"141. With respect to the House, s 24 stipulates that it: "shall be composed of members directly chosen by the people of the Commonwealth". Sections 8, 30 and 51(xxxvi) of the Constitution provide, subject to the Constitution, for the making by the Parliament of laws respecting the qualification of electors in Senate and House of Representatives elections. Sections 9, 31 and 51(xxxvi) of the Constitution provide, subject to the Constitution, for the making by the Parliament of laws respecting "the method of choosing" senators and members of the House of Representatives. Part VII (ss 93-97) of the Electoral Act deals with qualifications for, and disqualifications from, enrolment and voting and Pt VIII (ss 98AA-112) with enrolment. The legislative scheme apparent in Pt VII and Pt VIII entwines the method adopted for the choice of representatives (a secret ballot of enrolled electors) with the necessary qualifications of electors with respect to such matters of status as age and citizenship. The provisions of the Electoral Act thus have a duplicate or sequential character. The plaintiffs complain of "disenfranchisement" in the sense that by reason of the provisions of the 2006 Act they have been denied what otherwise would be the effect of their status as persons qualified to vote at the election on 21 August 2010. They also complain that while legislation of this character must be directed to the selection of members and senators who are chosen by the people, the provisions of the 2006 Act adopt a method which is not reasonably appropriate and adapted to serve the making of the electoral choice of which ss 9 and 31 of the Constitution speak. The central submission by the plaintiffs is that the Parliament in choosing the means to achieve the integrity of the Roll necessary to give effect to popular 141 With senators representing the Northern Territory and the Australian Capital Territory, s 40(1) of the Electoral Act speaks of their being "directly chosen by the people of the Territory". Bell choice within the meaning of ss 7 and 24 of the Constitution must select a means which is no more than necessary to preserve that integrity and must not legislate to deny unreasonably the opportunity to enrol and vote. The requirement for enrolment has been entwined with the requirements for status since the Commonwealth Franchise Act 1902 (Cth). Section 3 provided that subject to the provisions for disqualification in s 4, adults not under 21 years of age, who were natural born or naturalised subjects of the King and had lived in Australia for six months continuously, and who were enrolled, were entitled to vote. Section 93 of the Electoral Act as it now stands selects from among the population all persons who are not disqualified and have attained 18 years of age and are either Australian citizens or members of a closed class of British subjects who were enrolled immediately before 26 January 1984; if enrolled they are entitled to vote. While the course of the legislation since 1902 has conditioned the exercise of the franchise upon enrolment in the manner described, there has been significant change in the selection by the Parliament of those among the population who are to be taken to answer the constitutional expressions in ss 7 and 24 respectively "by the people of the State" and "by the people of the Commonwealth". This reflects the development of Australian citizenship law, which in turn followed the emergence of national status with the winding-up of the Empire142. It also reflects changing views of the role in Australian society of young persons, even if still of secondary school age in many cases, who have attained the age of 18 years, in matters of the franchise as well as of testamentary and contractual competence, service in the armed forces, and the like. The constitutional setting By the tersely worded provisions of ss 7, 8, 9, 24, 30, 31 and 51(xxxvi), the Constitution was drawn with an appreciation of both past and future development of a democratic system of government representative of, and reflective of the wishes of, "the people". In the immediate past lay the development of representative government in the Australian colonies. This had 142 Sue v Hill (1999) 199 CLR 462 at 487-488 [51]-[52]; [1999] HCA 30; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 398-401 [2]-[7], 465-468 [222]-[234]; [2001] HCA 51; Singh v The Commonwealth (2004) 222 CLR 322 at 382 [149]-[150]; [2004] HCA 43. Bell two presently relevant aspects. The first was a rapid growth in the development of universal and uniform adult male suffrage divorced from property qualifications, and direct election for the lower houses of the legislatures143. In the United Kingdom, on the other hand, at the beginning of the 20th century, it was possible to distinguish seven species of franchise, those identified as the property, freemen, university, occupation, household, lodger and service franchises144. The second striking Australian development had been the adoption of the secret ballot as the method of choice for the exercise of the franchise. Indeed, the facilitation of popular election in the Australian colonies by secret ballot had been influential in the enactment in the United Kingdom of the Ballot Act 1872 (UK), ss 4 and 20. The House of Lords had been impressed by tabled reports by the Governor of Tasmania145 and the Governor of South Australia146 as to the "perfect tranquillity" of the conduct of such elections, and the "mitigating influence" of the ballot upon "the occurrence of popular excitement and the discussion of disturbing topics"147. By 1901 the secret ballot, or "Australian ballot" as it was known, had been adopted in 40 of the then 45 States of the United States of America as a response to bribery and intimidation associated with viva voce polling methods148. Quick and Garran wrote, with respect to the Senate149: "The principle of popular election, on which the Senate of the Commonwealth is founded, is more in harmony with the progressive instincts and tendencies of the times than those according to which the 143 Roach v Electoral Commissioner (2007) 233 CLR 162 at 194-195 [69]. 144 Blewett, "The Franchise in the United Kingdom 1885-1918", (1965) 32 Past and Present 27 at 31. 145 Sir Charles Du Cane, Governor of Tasmania 1869-1874. 146 Sir James Fergusson, Governor of South Australia 1869-1873. 147 House of Lords Debates, 10 June 1872, vol 211, c1423. 148 "Elections", in Encyclopaedia Britannica, 10th ed (1902), vol XXVIII at 3. 149 The Annotated Constitution of the Australian Commonwealth, (1901) at 418. Bell Senate of the United States[150] and the Senate of Canada are called into existence. In the Convention which drafted the Constitution of the Commonwealth not a single member was found in favour of a nominated Senate. It was generally conceded, not only that a chamber so constituted would be of an obsolete type and repugnant to the drift of modern political thought, but that, as a Council of States, it would be an infirm and comparatively ineffective legislative body." This emphasis by Quick and Garran (who dedicated their work to "the people of Australia") upon the progressive instincts and tendencies of modern political thought retains deep significance for an understanding of the text and structure of the Constitution. It has been well said that one of the assumptions as to "traditional conceptions" upon which the Constitution was framed was the rule of law151. The law included not only the English common law which the colonies had received, and which, of its nature, can never be wholly static, but also the enacted law. What is of enduring and immediate significance is that, whatever else it involves, "the rule of law" posits legality as an essential presupposition for political liberty and the involvement of electors in the enactment of law. In the 19th century vast changes had been wrought by legislation influenced by the utilitarian movement associated with Jeremy Bentham, and the Constitution was framed in the belief that these "progressive instincts" would animate members of legislative chambers which were chosen by the people. By this means the body politic would embrace the popular will and bind it to the processes of legislative and executive decision making. The significance of developments in the period before the adoption of the Constitution is further considered in the reasons of Crennan J, under the headings "Britain – 'chosen by the people'" and "The Australian colonies – 'chosen by the people'". We agree that the term "chosen by the people" had come to signify the share of individual citizens in political power by the means of a democratic franchise. 150 The Senate of the United States was elected by the State legislatures until direct election was provided with the proclamation in 1913 of the 17th Amendment to the Constitution; this speaks of election "by the people" of each State. 151 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193; [1951] HCA 5; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 492 [31], 513 [103]; [2003] HCA 2. Bell The Constitution (ss 8 and 30) denied plural voting; this was then a subject of continuing debate in the United Kingdom, where it has been estimated that in 1911 there were probably more than 500,000 plural voters, some seven percent of the electorate152. However, subject to s 41153, the Constitution left for provision to be made by the Parliament what were then thorny issues of the female franchise and racial disqualification154. These matters of qualification for the franchise and of the methods of choice to be made by the electors were, by s 51(xxxvi), left by the Constitution, in the phrase used by Barwick CJ in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth155, to "the confidence reposed" in the Parliament. But legislative development always was to be overseen by the imperative of popular choice found in ss 7 and 24 of the Constitution. One result is explained in the following passage from the reasons of Gleeson CJ in Roach v Electoral Commissioner156: "In McKinlay157, McTiernan and Jacobs JJ said that 'the long established universal adult suffrage may now be recognised as a fact'. I take 'fact' to refer to an historical development of constitutional significance of the same kind as the developments considered in Sue v Hill. Just as the concept of a foreign power is one that is to be applied to different circumstances at different times, McTiernan and Jacobs JJ said that the words 'chosen by the people of the Commonwealth' were to be applied to different circumstances at different times. Questions of degree may be involved. They concluded that universal adult suffrage was a long established fact, and that anything less could not now be described as a choice by the people. I respectfully agree. As Gummow J said in McGinty v Western Australia158, we have reached a stage in the evolution 152 Blewett, "The Franchise in the United Kingdom 1885-1918", (1965) 32 Past and Present 27 at 46. 153 See R v Pearson; Ex parte Sipka (1983) 152 CLR 254. 154 Roach v Electoral Commissioner (2007) 233 CLR 162 at 195 [70]. 155 (1975) 135 CLR 1 at 25; [1975] HCA 53. See also Kartinyeri v The Commonwealth (1998) 195 CLR 337 at 380-381 [88]; [1998] HCA 22. 156 (2007) 233 CLR 162 at 174 [7]. 157 (1975) 135 CLR 1 at 36. 158 (1996) 186 CLR 140 at 286-287; [1996] HCA 48. Bell of representative government which produces that consequence. I see no reason to deny that, in this respect, and to this extent, the words of ss 7 and 24, because of changed historical circumstances including legislative history, have come to be a constitutional protection of the right to vote." His Honour continued: "That, however, leaves open for debate the nature and extent of the exceptions. The Constitution leaves it to Parliament to define those exceptions, but its power to do so is not unconstrained. Because the franchise is critical to representative government, and lies at the centre of our concept of participation in the life of the community, and of citizenship, disenfranchisement of any group of adult citizens on a basis that does not constitute a substantial reason for exclusion from such participation would not be consistent with choice by the people159. To say that, of course, raises questions as to what constitutes a substantial reason, and what, if any, limits there are to Parliament's capacity to decide that matter." With respect to the provisions of the 2006 Act which were held invalid in Roach, "The step that was taken by Parliament in 2006 of abandoning any attempt to identify prisoners who have committed serious crimes by reference to either the term of imprisonment imposed or the maximum penalty for the offence broke the rational connection necessary to reconcile the disenfranchisement with the constitutional imperative of choice by the people." With respect to the method of choice adopted by the Electoral Act in its form since the 2006 Act, the statement by Isaacs J in Kean v Kerby161 is appropriate: "For centuries parliamentary elections were conducted by open voting. Freedom of election was sought to be protected against intimidation, riots, duress, bribery, and undue influence of every sort. Nevertheless it was found necessary to introduce the ballot system of voting. The essential point to bear in mind in this connection is that the ballot itself is only a 159 cf McGinty v Western Australia (1996) 186 CLR 140 at 170 per Brennan CJ. 160 (2007) 233 CLR 162 at 182 [24]. 161 (1920) 27 CLR 449 at 459; [1920] HCA 35. Bell means to an end, and not the end itself. It is a method adopted in order to guard the franchise against external influences, and the end aimed at is the free election of a representative by a majority of those entitled to vote. Secrecy is provided to guard that freedom of election." (emphasis added) Authorities including McKinlay162, McGinty v Western Australia163, Langer v The Commonwealth164 and Mulholland v Australian Electoral Commission165 indicate that the authority placed in the Parliament by s 51(xxxvi) of the Constitution carries a considerable measure of legislative freedom as to the method of choice of the members of the Parliament. The first two of these cases concerned the methods for distribution of electors between Electoral Divisions, the third the method of marking ballot papers and the proscription of the distribution of material encouraging electors to vote informally, and the fourth the naming on ballot papers of political parties only if they were registered parties. In Langer166, McHugh J observed that a member is "chosen by the people" even if elected by a system which requires electors to indicate a preference between multiple candidates or, indeed, if elected unopposed. Nevertheless, the method for the conduct of the ballot is not an end in itself but the means to the end indicated in ss 7 and 24 of the Constitution, namely the election of legislative chambers "directly chosen by the people" of the respective States (in the case of the Senate) and of the Commonwealth (in the case of the House). The secret ballot of enrolled electors is the method chosen by the Parliament to give effect to the franchise of qualified electors. Hence the statement by the Court in Snowdon v Dondas167 that the importance of maintaining unimpaired the exercise of the franchise need hardly be stated. The method of choice and the Electoral Act As noted above when outlining the relevant provisions of the Constitution, s 93 of the Electoral Act deals with the entitlement of persons to enrolment and to vote. The scheme of the section is to identify those "entitled to enrolment" 162 (1975) 135 CLR 1. 163 (1996) 186 CLR 140. 164 (1996) 186 CLR 302; [1996] HCA 43. 165 (2004) 220 CLR 181; [2004] HCA 41. 166 (1996) 186 CLR 302 at 341. 167 (1996) 188 CLR 48 at 71; [1996] HCA 27. Bell (s 93(1)). The plaintiffs are both qualified, being Australian citizens who have attained 18 years of age and are not otherwise disqualified. Entitlement to vote is then limited to electors whose names are on the relevant Roll (s 93(2)). Provision is also made for enrolment from outside Australia (s 94A) and the eligibility of spouses, de facto partners and children of eligible overseas electors (s 95), and for persons identified as itinerant electors (s 96). Section 102 prescribes the Electoral Commissioner upon receipt of a claim for enrolment or transfer of enrolment. Section 106 provides for the removal from the Roll of persons securing enrolment by a false statement; the removal may be made at any time between the date of issue of the relevant writ and the close of polling. the steps taken by to be Section 245(1) states that it "shall be the duty of every elector to vote at each election". This legislatively stated duty furthers the constitutional system of representative government by popular choice. The duty is supported by s 245(15), which renders an elector who fails to vote at an election guilty of an offence. Enrolment of qualified persons is encouraged by s 101, which deals with compulsory enrolment and compulsory transfer of enrolment. The section imposes a criminal sanction for failure to comply within 21 days of entitlement to placement upon the Roll for any Subdivision of an Electoral Division, whether by way of initial enrolment (as in the case of the first plaintiff) or by way of transfer of enrolment (as in the case of the second plaintiff). However, common experience suggests a range of causes of human conduct, beyond careless disregard of civic responsibility, which may lead to untimely enrolment or transfer of enrolment. Hence, s 101(7) is an important provision in this compulsory system. A provision to this effect was first introduced by s 28 of the Commonwealth Electoral Legislation Amendment Act 1983 (Cth) ("the 1983 Act"). Section 101(7) provides: "Where a person sends or delivers a claim for enrolment, or for transfer of enrolment, to the Electoral Commissioner, proceedings shall not be instituted against that person for any offence against subsection (1) or (4) committed before the claim was so sent or delivered." The plaintiffs are in that position, having made late claims, and proceedings may not be instituted against them for any offence under s 101. Bell The validity of the forerunner of the compulsory voting requirement in s 245168 was upheld in Judd v McKeon169. Isaacs J referred to the phrase "method of choosing" in s 9 of the Constitution and concluded that a method of choosing which involves compulsory voting is valid so long as it preserves the freedom of choice of possible candidates170. His Honour also said171: "[Parliament] may demand of a citizen his services as soldier or juror or voter. The community organized, being seised of the subject matter of parliamentary elections and finding no express restrictions in the Constitution, may properly do all it thinks necessary to make elections as expressive of the will of the community as they possibly can be." (emphasis added) The above statement by Isaacs J in Judd is consistent with the point earlier made by Isaacs J in Kean v Kerby172 and set out above, namely that the legislative selection of the ballot system of voting and provisions for the efficacy of that system is not an end in itself but the means to the end of making elections as expressive of the will of the majority of the community as proper practical considerations permit. It is that understanding which explains the force of the phrase "directly chosen by the people" in ss 7 and 24 of the Constitution, and is determinative of the issues in this litigation. That expression of community will cannot be expected to be wholly effective and the phrase "chosen by the people" in ss 7 and 24 of the Constitution must be read so as to allow for this. Where the legislatively selected method of choice is a compulsory ballot of enrolled electors it is to be expected that there will be no perfect correspondence between those enrolled and those otherwise enfranchised. Further, the efficacy of the administrative means available to facilitate the composition and accuracy of the Roll will depend upon the 168 Section 128A, added by s 2 of the Commonwealth Electoral Act 1924 (Cth). Compulsory voting had been required for the "conscription" plebiscites conducted during World War I: Wong v The Commonwealth (2009) 236 CLR 573 at 583-584 [27]-[30]; [2009] HCA 3. Compulsory enrolment had been introduced by s 7 of the Commonwealth Electoral Act 1911 (Cth). 169 (1926) 38 CLR 380; [1926] HCA 33. 170 (1926) 38 CLR 380 at 385. 171 (1926) 38 CLR 380 at 385. 172 (1920) 27 CLR 449 at 459. Bell resources made available by the legislation and the assistance given by changes in technology. Section 111 of the Electoral Act (first introduced by s 35 of the 1983 Act as s 51A and later renumbered) provides for the use by the Commission of computer records relating to the Roll. In contrast, s 33 of the Commonwealth Electoral Act 1902 (Cth) had required State police officers, among others, to furnish information for the preparation and revision of lists of all persons qualified or entitled to be enrolled; using these means, almost two million names were entered on the Roll in 1903, some 96 percent of the adult population173. Since 1999 the Commission has maintained the Roll by a process of data-matching authorised by s 92 of the Electoral Act and referred to as Continuous Roll Update or "CRU". Between June 1980 and June 2008 there was an increase in enrolments from 8.9 million persons to 13.8 million persons, and the net average increase in enrolment was 173,000 people per annum. This was significantly lower than the estimated 195,000 growth per annum in the estimated number of resident citizens based on census data. With respect to the accuracy of the entries on the Rolls, a report upon the integrity of the Electoral Roll, made in 2002 by the Australian National Audit Office under the leadership of the Auditor-General174, found that instances of opportunistic fraud (rather than systemic or widespread fraud), such as that which had occurred in a Queensland State by-election in 1996, were such as to be unlikely to affect the outcome of federal elections175. The resources of the Commission have been applied particularly in encouraging, by advertising and other methods, additional enrolments in the period immediately before general elections. The prompt processing of enrolments is assisted by a computerised Roll Management System conducted by the Commission and known as "RMANS". In 2007, by reason of the changes made by the 2006 Act shortening the period for the closing of the Rolls, the 173 Sawer, "Enrolling the People: Electoral Innovation in the New Australian Commonwealth", in Orr, Mercurio and Williams (eds), Realising Democracy, 174 Section 15 of the Auditor-General Act 1997 (Cth) provides for the conduct of performance audits of bodies including the Commission and for the tabling of the report in each House of the Parliament. 175 Commonwealth, Auditor-General, Integrity of the Electoral Roll: Australian Electoral Commission, Audit Report No 42 2001-02, 18 April 2002 at 33-34. Bell Commission could not rely on the strategic approach it had used in previous elections of starting intensive advertising once an election had been called on the basis that there was a regime for a guaranteed seven day period before the closing of the Rolls. The plaintiffs make no complaint that were it not for the changes made by the 2006 Act, the Electoral Act would not adopt means appropriate and adapted to the choice by the people of senators and members of the House. It was s 45 of the 1983 Act which introduced the provision later renumbered as s 155. The text is set out below and provided that the date fixed for the close of the Rolls was to be seven days after the date of the relevant writ. Previously, s 45 of the Electoral Act had required that claims for enrolment or transfer of enrolment received after 6pm on the day of the issue of the writ for an election were not to be registered until after the close of polling. That provision was repealed by s 29 of the 1983 Act and replaced by what was later renumbered as s 102(4), which is set out below. Two things are to be said respecting this legislative history. The first is that the plaintiffs make no challenge to the seven day period. It may be that developments in technology and availability of resources will support the closure of the Rolls at a date closer to election day. But this is a matter of speculation and inappropriate for further consideration here. An implication running through the submissions presented against the plaintiffs by the Commonwealth and Western Australia was that if the changes made by the 2006 Act which are challenged by the plaintiffs are invalid, then the same principles would require that the seven day period provisions they replaced also be invalid, and the plaintiffs must fail because they challenged only the 2006 Act changes. There is no self-evident contradiction in the plaintiffs' case. Whether the pre-2006 Act seven day system operated to disqualify substantial numbers of electors for what then was no substantial reason in the constitutional sense does not answer the claim made by the plaintiffs respecting the 2006 Act. The second point is that in the period before the 1983 Act when the legislation required early closure of the Rolls, no challenge was made to its validity. The reasons for that state of affairs again are a matter for speculation. Before further proceeding in these reasons something should be said of the facts. Late enrolments The particular operation of the enrolment provisions of the Electoral Act upon the two plaintiffs conveniently appears from pars 5-8 of the Notice dated 26 July 2010 which has been given under s 78B of the Judiciary Act 1903 (Cth): Bell The First Plaintiff was not on the roll on the date that the Writs were issued, but is entitled to enrol pursuant to ss 93 and 99(1) of the Act and required to lodge a claim to enrol pursuant to s 101 of the Act. After 8pm on Monday 19 July, but before 8pm on Monday 26 July 2010, the First Plaintiff applied to have her name added to the roll pursuant to s 101(1) of the Act. Section 102(4) of the Act has the effect that the Divisional Returning Officer, who pursuant to s 32(1) of the Act is subject to the direction of the First Defendant, cannot consider the First Plaintiff's claim to enrol to vote until after the Election. Thus the First Plaintiff cannot have her name added to the roll until after the Election. Section 102(4) will thus prevent the First Plaintiff from voting in the Election. The Second Plaintiff was on the roll for the Division of Wentworth on the date that the writs were issued, thus entitling him to vote in relation to that Division. However, on the date that the writs were issued, the Second Plaintiff resided at a different address, entitling him to be on the roll for the Division of Sydney. After 8pm on Thursday 22 July 2010, but before 8pm on Monday 26 July 2010, the Second Plaintiff applied to transfer his enrolment pursuant to s 101(1) of the Act. Sections 102(4AA) and s 155 of the Act have the effect that the Divisional Returning Officer, who pursuant to s 32(1) of the Act is subject to the direction of the First Defendant, cannot consider the Second Plaintiff's claim to transfer his enrolment until after the Election. Thus the Second Plaintiff will not have his name transferred to the roll for Sydney until after the Election. Sections 102(4AA) and 155 will thus prevent the Second Plaintiff from voting in the Election in the Subdivision in which he resides." Before the commencement of the 2006 Act, s 102(4) of the Electoral Act read: "A claim under section 101 by a person to have his or her name placed on the Roll for a Subdivision received during the period commencing at 8 pm on the day on which the Rolls for an election to be held in the Subdivision close and ending on the close of polling at the election shall not be considered until after the expiration of that period." Bell The date for the closing of the Rolls was prescribed by s 155 as follows: "The date fixed for the close of the Rolls shall be 7 days after the date of the writ." The plaintiffs asserted in particular the invalidity of the repeal of s 102(4) and s 155 by the 2006 Act: Sched 1, Items 41 and 52. Item 52 repealed s 155 and substituted: "Date for close of Rolls The date fixed for the close of the Rolls is the third working day after the date of the writ. Note: However, generally names are not added to or removed from the Rolls after the date of the writ. In this section: working day means any day except: a Saturday or a Sunday; or a day that is a public holiday in any State or Territory." Item 41 repealed s 102(4) and substituted: If a claim by a person for enrolment under section 101 (other than a claim that is taken, by subsection 99B(6), to be made under section 101) is received during the period: beginning at 8 pm on the date of the writ or writs for an election for the Division to which the claim relates; and ending at the close of the polling at the election; then the claim must not be considered until after the end of the period. If a claim by a person for transfer of enrolment under section 101, or a claim that is taken, by subsection 99B(6), to be made under section 101, is received during the period: beginning at 8 pm on the date of the close of the Rolls for an election for the Division to which the claim relates; and Bell ending at the close of the polling at the election; then the claim must not be considered until after the end of the period. A claim that is taken, by subsection 100(2), to be made under section 101: is to be treated in accordance with subsection (4AA) if the claim is made by a person who will turn 18 years old during the period: beginning at 8 pm on the date of the writ or writs for an election for the Division to which the claim relates; and ending at the end of the polling day for the election; and otherwise – is to be treated in accordance with subsection (4)." The plaintiffs complain in particular of the new ss 102(4) and 102(4AA), and of the new s 155. Items 20, 24 and 28 of Sched 1 to the 2006 Act made changes to similar effect to the provisions dealing respectively with enrolment from outside Australia (s 94A(4)), the eligibility of spouses, de facto partners and children of eligible overseas electors (s 95(4)), and itinerant electors (s 96(4)). The Commonwealth accepted that if the provisions immediately affecting the plaintiffs be invalid then the remaining Items would be invalid by parity of reasoning or as inseverable from invalid provisions. Hence attention will be directed in these reasons first to the provisions immediately affecting the plaintiffs. The agreed facts show that with respect to the general elections conducted in 1993, 1996, 1998 and 2001, the numbers of enrolments (and re-enrolments) and transfers of enrolment in the period between the issue of the writs and the closing dates for claims to enrol or transfer were, respectively, 377,769; 376,904; 355,189 and 373,732; and that the total enrolments were, respectively, 11,348,967; 11,655,190; 12,056,625 and 12,636,631. For the 2004 general election there were 423,993 enrolment transactions before the Rolls closed and 168,394 claims were lodged after they closed. For the 2007 election, when the changes made by the 2006 Act were in operation, there were 279,469 enrolment transactions before the Rolls closed and 100,370 claims lodged after they closed. Bell Day by day data on enrolment transactions in the period from the issue of the writs for the 1998 and 2001 general elections showed that the number of new claims and re-enrolments increased daily during the then applicable seven day period (except on Saturday and Sunday) and 50 percent of claims were made on the last day. With respect to the general election called for 21 August 2010, approximately 508,000 claims were received between the announcement of the election and the current deadlines of 8pm on the day of issue of the writs (for new enrolments) and 8pm on the day of the close of the Rolls (in the case of transfers and other applications). As already noted, a large number of claims were received after these deadlines but within a seven day period from the date of the writs, the date for the close of the Rolls before the 2006 Act. Validity The Commonwealth accepts, as it must, that the authority of the Parliament to make laws with respect to the qualification of electors and the conduct of elections is subject to the constraints respecting popular choice placed upon its legislative power by ss 7 and 24 of the Constitution. The Commonwealth also accepts that in assessing the validity of the provisions in the 2006 Act of which the plaintiffs complain regard is to be had not only to their legal but also to their practical operation. This, indeed, is what the authorities require176. The Commonwealth further accepts that if the legal or practical operation of a law is to disqualify adult citizens from enrolling, and thus from exercising their franchise, the consistency of that law with ss 7 and 24 of the Constitution is to be determined in accordance with the reasoning in Roach177. However, the Commonwealth submits that "viewed in context" the impugned provisions of the 2006 Act do not erect a disqualification from the franchise. To that end, the Commonwealth characterises the challenged provisions of the 2006 Act as in neither legal nor practical effect going "beyond matters of procedure". The distinction between matters of substance and those of procedure is recognised in various areas of the law, principally those concerned with the conduct of litigation, statutory interpretation, and classification for 176 Ha v New South Wales (1997) 189 CLR 465 at 498; [1997] HCA 34; New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 121 [197]; [2006] HCA 52. 177 (2007) 233 CLR 162. Bell choice of law purposes. But, as was said in John Pfeiffer Pty Ltd v Rogerson178, one of the guiding principles for any distinction between substantive and procedural matters is that: "matters that affect the existence, extent or enforceability of the rights or duties of the parties to an action are matters that, on their face, appear to be concerned with issues of substance, not with issues of procedure". The procedures in the challenged provisions of the 2006 Act apply to the ballot system, which is not an end in itself, but as stressed earlier in these reasons, the means adopted by the Parliament to make elections expressive of popular choice. Further, the Electoral Act is so drawn as to give these provisions substantive consequences for the exercise of the franchise. The interrelation, already described, between the requirements for enrolment and those for voting entitlement is such that failure to comply with the former denies the exercise of the latter by persons otherwise enfranchised. In this way, the method of choice adopted by the legislation fails as a means to what should be the end of making elections as expressive of the popular choice as practical considerations properly permit. The requirements operate to achieve disqualification in the sense used in Roach. The Commonwealth seeks to avoid this conclusion by first fixing upon the legal operation of the provisions of the 2006 Act. The Commonwealth points to the legal operation of the legislation in what it submits are but limited and exceptional cases. Persons who attain the age of 18 between the issue of the writs and polling day, or who are due to be granted citizenship in that period, will not be able to secure enrolment and entitlement to vote at the election unless they have made use of the early claim procedures in s 100 and s 99B respectively. With respect to transfers of enrolment, those who change their address in the month before the issue of writs and for whom the one month requirement (in s 99(2)) for the new residence expires between the three and seven day period will not be able to transfer their enrolment. As to the first two of these three groups, the Commonwealth submits that their disqualification is the result of their failure to use the early claim procedures. The situation of the third group is said to be the inevitable consequence of any cut-off date with respect to transfers. However, with respect to these three groups of adult citizens there will be disenfranchisement, and arguments that these groups are but limited or 178 (2000) 203 CLR 503 at 543 [99]; [2000] HCA 36. Bell exceptional cases are no answer unless the consideration upon which the Commonwealth relies supplies a substantial reason in the sense used in the reasons of the two majority judgments in Roach. It is unnecessary to decide whether a substantial (and therefore sufficient) reason for disqualification of members of the three groups by this legal operation of the 2006 Act is the placing of permissible "cut-off" points for the operation of the enrolment system. This is because of the scope of the practical operation of the legislation to disqualify the plaintiffs and large numbers of other electors. That many persons are stimulated to claim enrolment or transfer only upon awareness of the start of the particular electoral cycle is a phenomenon that was well apparent before the enactment of the 2006 Act. And, after all, there are estimated to be some 100,000 persons in the present position of the plaintiffs. The Commonwealth submits that the practical operation of the 2006 Act upon persons such as the plaintiffs is met by the existence of the prior opportunity and obligation under s 101 to claim enrolment and transfer. Western Australia also draws a distinction between those eligible but excluded, despite doing everything open to them to exercise the franchise, and those, such as the plaintiffs, who fail to comply with the prescribed method of exercising the franchise. However, as explained earlier in these reasons, with particular reference to the requirement in s 101(7) that proceedings not be instituted where a late claim for enrolment or transfer has been made, the obligation to claim enrolment and transfer is designed to facilitate maximum participation in the electoral process of to support disenfranchisement. those otherwise qualified to vote, not The position then is reached that the 2006 Act has the practical operation of effecting a legislative disqualification from what otherwise is the popular choice mandated by the Constitution. It is no sufficient answer, as Western Australia submits, that Roach is not reached because the disqualification does not apply to those who have promptly enrolled or claimed transfer of enrolment and only applies to those who have failed to do so, and this state of affairs is the product of permissible legislative choice. Rather, the relevant starting point is to ask whether, at the time when the choice is to be made by the people, persons otherwise eligible and wishing to make their choice are effectively disqualified from doing so. If so, the question then becomes whether, as Gleeson CJ put it in Roach179, there has been broken the rational connection necessary to reconcile the 179 (2007) 233 CLR 162 at 182 [24]. Bell disqualification with the constitutional imperative, and whether, as Gummow, Kirby and Crennan JJ put it in the same case180: the maintenance of is consistent or compatible with "Is the disqualification for a 'substantial' reason? A reason will answer that description if it be reasonably appropriate and adapted to serve an end the which constitutionally prescribed system of representative government. When used here the phrase 'reasonably appropriate and adapted' does not mean 'essential' or 'unavoidable'181. Rather, as remarked in Lange182, in this context there is little difference between what is conveyed by that phrase and the notion of 'proportionality'. What upon close scrutiny is disproportionate or arbitrary may not answer to the description reasonably appropriate and adapted for an end consistent or compatible with observance of the relevant constitutional restraint upon legislative power." The Commonwealth accepts that formulation of principle in the joint reasons. In doing so the Commonwealth did not seek to elevate the notion of "proportionality" to a distinct criterion of legislative validity. In his reasons in Roach183 Gleeson CJ saw a danger in uncritical translation into Australian constitutional law, as a criterion of validity, of the concept of proportionality as understood in other systems. Earlier, in the Industrial Relations Act Case184, consideration was given to the power of legislative implementation of treaties; Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ remarked185: "It has been said that a law will not be capable of being seen as appropriate and adapted in the necessary sense unless it appears that there is 'reasonable proportionality' between that purpose or object and the 180 (2007) 233 CLR 162 at 199 [85]. 181 See the discussion of the subject by Gleeson CJ in Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 199-200 [39]-[40]. 182 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567 fn 272; [1997] HCA 25. 183 (2007) 233 CLR 162 at 178-179 [17]. See also Leask v The Commonwealth (1996) 187 CLR 579 at 594-595 per Brennan CJ, 600-601 per Dawson J, 615-616 per Toohey J, 624 per Gummow J; [1996] HCA 29. 184 Victoria v The Commonwealth (1996) 187 CLR 416; [1996] HCA 56. 185 Industrial Relations Act Case (1996) 187 CLR 416 at 487-488. Bell means adapted by the law to pursue it186. The notion of 'reasonable proportionality' will not always be particularly helpful. The notion of proportion suggests a comparative relation of one thing to another as respects magnitude, quantity or degree; to ask of the legislation whether it may reasonably be seen as bearing a relationship of reasonable proportionality to the provisions of the treaty in question appears to restate the basic question. This is whether the law selects means which are reasonably capable of being considered appropriate and adapted to achieving the purpose or object of giving effect to the treaty, so that the law is one upon a subject which is an aspect of external affairs." Their Honours also noted that the legislative power conferred by s 51(xxix) had a "purposive aspect" where the validity of a law depended upon its purpose or object of treaty implementation187. So also s 51(xxxvi) may be said to be "purposive" in the sense of facilitating the method of choice by qualified electors. In neither case is the notion of proportionality a free standing criterion for assessment of validity, and the Commonwealth did not submit that it was so. The Commonwealth, however, submits that the existence of a "mischief" represented by some existing level of electoral fraud is not a prerequisite for the establishment of a "substantial" reason for disenfranchisement. This is said to be because a measure does not travel beyond that which is reasonably appropriate and adapted to serve the end of choice by the people within the meaning of ss 7 and 24 of the Constitution "merely because its motivation is prophylactic rather than reactive". With respect to that motivation, the Commonwealth refers to passages in the majority Report of the Joint Standing Committee on Electoral Matters of the Parliament188. Paragraphs 2.121-2.123 stated: The Committee also agrees that the current close of roll arrangements present an opportunity for those who seek to manipulate the roll to do so at a time where little opportunity exists for the [Commission] to undertake the thorough checking required ensuring roll integrity. 186 Richardson v Forestry Commission (1988) 164 CLR 261 at 311-312; [1988] HCA 10. 187 Industrial Relations Act Case (1996) 187 CLR 416 at 486-487. 188 Commonwealth, Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, September 2005 at 35. Bell The Committee believes that those who argue for the retention of the seven day close of rolls and who promote the argument that there is no proof that enrolment fraud is sufficiently widespread to warrant any action, have missed the point. The fundamental issue facing this Committee is to prevent any such fraud before it is able to occur. Failure to do so would amount to neglect." This majority Report was referred to in general terms in the Minister's second reading speech on the Bill for the 2006 Act189. The minority opinion in the Report included the following190: "The [Commission] has never said that it cannot handle the volume of applications received during the seven-day period before the rolls close. In fact it has said that the seven-day period does not prevent it taking adequate measures to prevent fraudulent enrolment. The [Commission] continues its checks into the integrity of the roll in the period following the closing of the rolls to ensure people are eligible to vote, and also after the rolls close (evidence of Mr Paul Dacey, 5 August 2005). The removal of the seven-day period would therefore have little qualitative impact on the integrity of the roll. More broadly, there is no evidence that fraudulent enrolment exists on any measurable scale or has ever influenced the outcome of any federal election. No witness or submission to this Inquiry produced evidence of fraudulent enrolment." It is, as Mason J emphasised in R v Toohey; Ex parte Northern Land Council191, incontestable that the motives which inspire legislators are not relevant in the determination of validity. Accordingly, the term "motivation" in the submissions by the Commonwealth is better understood as used in the sense of legislative purpose. As noted above, s 51(xxxvi) of the Constitution may be described as purposive in the sense that it is facilitative of the particular method 189 Australia, House of Representatives, Parliamentary Debates (Hansard), 8 December 2005 at 19. 190 Commonwealth, Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, September 2005 at 360-361. 191 (1981) 151 CLR 170 at 225-226; [1981] HCA 74. Bell of choice to be employed by qualified electors. Enrolment fraud is addressed by s 106 of the Electoral Act, to which reference has been made in these reasons. Whether a particular measure goes beyond the constraints which ss 7 and 24 of the Constitution place upon s 51(xxxvi) cannot depend upon the purpose attributed to the Parliament in enacting that measure. In particular, the requirement in Roach that any disqualification be for a substantial reason cannot be answered simply by what may appear to have been legislative purpose. A legislative purpose of preventing such fraud "before it is able to occur", where there has not been previous systemic fraud associated with the operation of the seven day period before the changes made by the 2006 Act, does not supply a substantial reason for the practical operation of the 2006 Act in disqualifying large numbers of electors. That practical operation goes beyond any advantage in preserving the integrity of the electoral process from a hazard which so far has not materialised to any significant degree. Conclusions The declaration made in this case on 6 August 2010 is supported by these reasons, which largely were prepared during the pendency of the general election held on 21 August 2010 and are expressed accordingly. The plaintiffs also sought mandamus. There is no requirement for such relief, given the evidence for the Commissioner to which reference has been made. The reasoning of this Court upon the issue of invalidity has binding force in the general sense described in Pape v Federal Commissioner of Taxation192. An order should now be made otherwise dismissing the application. 192 (2009) 238 CLR 1 at 69 [158]; [2009] HCA 23. Hayne 170 HAYNE J. Each plaintiff is an Australian citizen who has attained the age of 18 years. Each is entitled193 to be enrolled on an Electoral Roll under the Commonwealth Electoral Act 1918 (Cth) ("the Act"). If enrolled, each is entitled194 to vote at elections of senators for the State (or Territory195) in which she or he resides, and at elections of members of the House of Representatives for the Subdivision196 in which she or he resides. Each plaintiff is not simply entitled to be enrolled and vote. Each is bound197 to claim enrolment on the appropriate roll. If enrolled, each is bound198 to vote. Failure to perform either obligation is an offence199. Neither plaintiff made the requisite claim when obliged to do so. Neither plaintiff made that claim before the time fixed under the Act for making (in the case of the first plaintiff) a claim for new enrolment, or (in the case of the second plaintiff) a claim for transfer of enrolment, that would be given effect for the purposes of the federal election to be held on 21 August 2010. There are many who were eligible to enrol as electors but who did not make a claim for new enrolment, and many others who did not make a claim for transfer of enrolment, when they were bound to do so. On Saturday, 17 July 2010, the Prime Minister announced that an election would be held on 21 August. Writs for the election were issued on the following Monday, 19 July 2010. More than 500,000 claims for enrolment were received 193 Commonwealth Electoral Act 1918 (Cth) ("the Act"), s 93(1). 196 Section 56 of the Act provides for each State and the Australian Capital Territory to be distributed into Electoral Divisions. By operation of s 55A the reference in s 56 to a State includes a reference to the Northern Territory. Section 57 provides that one member of the House of Representatives is to be chosen for each Division. Although Pt V of the Act provides for the Electoral Commission to divide a Division into Subdivisions, that has not been done. Entitlement to enrol is, however, expressed in s 99 in terms of residence in and enrolment for a Subdivision. Section 4(4) provides that where a Division is not divided into Subdivisions, references to a Subdivision are to be read as referring to the Division. Hayne after the election announcement on 17 July and before the start of periods fixed by s 102(4) and (4AA) of the Act as periods during which applications for new enrolment or transfer of enrolment may not be considered for the purposes of that election. Many others who were eligible to enrol did not make a claim before the relevant period began but made claims within seven days after the writs had issued. The exact number of those who made claims after the cut-off dates fixed by the Act, but within seven days after the writs had issued, is not known. The evidence filed for the Electoral Commissioner suggested that the number may be about 100,000, but went on to say that there is a "considerable margin of uncertainty in that estimate". Be this as it may, it may reasonably be assumed that there are many who were eligible to enrol, or required to transfer enrolment, who made a claim after the times fixed by the Act. It also may reasonably be assumed that many of these persons are young people who have turned 18 since the last election, and that many are young people who have moved since becoming enrolled for a particular Division. But as these reasons will later show, the fact that many affected by the cut-off dates are young people is not relevant to the constitutional issues that arise. The period fixed by s 102(4) of the Act, as the period during which claims for new enrolment may not be considered, begins at 8 pm on the date of the writ or writs for an election for the Division to which the claim relates, and ends at the close of polling at the election. The period fixed by s 102(4AA) of the Act, as the period during which claims for transfer of enrolment may not be considered, begins at 8 pm on the date of the close of the rolls (fixed by s 155(1) as the third working day after the date of the writ) and ends at the close of polling at the election. For the 2010 election, the periods began at 8 pm on Monday, 19 July 2010 (in the case of claims for new enrolment), and 8 pm on 22 July 2010 (in the case of claims for transfer of enrolment). By a proceeding commenced in the original jurisdiction of this Court, claiming declaration and mandamus, the plaintiffs alleged that the provisions of the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth) ("the 2006 Act"), by which what are now ss 102(4), 102(4AA) and 155 were inserted in the Act, are invalid. They alleged that an election conducted under the conditions prescribed by these provisions will not yield Houses of the Parliament that answer the description in ss 7 and 24 of the Constitution: "directly chosen by the people". The plaintiffs submitted that, the present provisions of ss 102(4), 102(4AA) and 155 being invalid, the provisions of the Act as they stood before the introduction of the impugned provisions by the 2006 Act are engaged. As the Act stood before the amendments made by the 2006 Act, s 102(4) provided that claims for enrolment (whether new enrolment or transfer of enrolment) received during the period commencing at 8 pm on the day on which the rolls for an Hayne election close, and ending on the close of polling at the election, were not to be considered until after the expiration of that period. Section 155 of the Act, as it then stood, provided that the date fixed for the close of the rolls was seven days after the date of the writs. Each plaintiff made her or his claim less than seven days after the date writs were issued for the election to be held on 21 August. Reduced to its essentials, the plaintiffs' argument was that cutting off consideration of claims for new enrolment or transfer of enrolment seven days after the date of the issue of the writs for a federal election is valid, but cutting off consideration of claims for new enrolment at 8 pm on the day the writs issue, and consideration of claims for transfer of enrolment at 8 pm on the third working day after the date of the writs, is not. An election conducted according to the former scheme was said to yield Houses of the Parliament "directly chosen by the people"; an election conducted according to the provisions introduced by the 2006 Act, it was said, will not. Accordingly, the plaintiffs claimed a declaration that the provisions of the 2006 Act which inserted ss 102(4), 102(4AA) and 155 of the Act (as now in force) are invalid, and mandamus directed to the first defendant, the Electoral Commissioner, requiring the Commissioner to consider the claim for new enrolment made by the first plaintiff and the claim for transfer of enrolment made by the second plaintiff. On it being pointed out in oral argument that the submissions made by the plaintiffs appeared to entail that other provisions of the 2006 Act are invalid and that it is evidently undesirable that the Electoral Commissioner, required to conduct the election to be held on 21 August "according to law", should be left uncertain about the validity of those other provisions, the plaintiffs, without objection from the Commonwealth or the Electoral Commissioner, amended their claim to seek a wider declaration. On 6 August, the Court made a declaration of the kind sought by the plaintiffs in their amended application. In my opinion, the proceedings should have been dismissed. What follows are my reasons for that opinion. The reasons will be seen to comprise two distinct parts: first, identification of the relevant constitutional question and consideration of why that question should be answered against the plaintiffs, and second, consideration of the questions which the plaintiffs said should be addressed and why those questions should also be answered against the plaintiffs. The first hinges about the constitutional phrase "directly chosen by the people". The second focuses upon the notion of "reasonably appropriate and adapted". Identifying the relevant question As is apparent from what has already been said in these reasons, I would describe the relevant question as: whether the impugned provisions will yield Hayne Houses of the Parliament "directly chosen by the people". That description of the question depends upon a number of intermediate steps that should be exposed. otherwise The Constitution provides for the laws in force in each State for the time being relating to elections for the more numerous House of the Parliament of the State to apply "as nearly as practicable" to elections of senators for the State (s 10) and elections in the State of members of the House of Representatives (s 31). Those provisions of ss 10 and 31 are engaged, in each case, "[u]ntil the Parliament this Constitution". but Section 51(xxxvi) gives the Parliament legislative power with respect to matters in respect of which the Constitution makes provision until the Parliament otherwise provides. That power is limited by the requirements of ss 7 and 24. Hence the question is whether the particular provisions made by ss 102(4), 102(4AA) and 155 travel beyond the limits of the power that is given by s 51(xxxvi) in its operation with respect to ss 10 and 31, because an election conducted in accordance with the Act, including those provisions, would not yield Houses that meet the constitutional description. provides, subject Much of the argument proceeded on the footing that the question just identified should be approached according to a two-stage inquiry founded on what was said in the plurality reasons in Roach v Electoral Commissioner200. The Commonwealth, in its submissions, described those two stages in the following way. First, is there a "disqualification from what otherwise is adult suffrage"? That is, does the impugned law detract in some significant way from the existence of a franchise that is held generally by adult citizens? Second, is that disqualification not "for a substantial reason"? A reason was said201 by the plurality in Roach to be "substantial" "if it be reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government". But, as the plurality further pointed out202, "reasonably appropriate and adapted", in the context then under consideration, did not mean "essential" or "unavoidable". It should be said immediately that this case is significantly different from Roach, and that there can be no automatic application of what was said in Roach to this case. Any application of what was said there must always be linked to constitutional bedrock203: the the requirement constitutional description. that each House meet 200 (2007) 233 CLR 162; [2007] HCA 43. 201 (2007) 233 CLR 162 at 199 [85]. 202 (2007) 233 CLR 162 at 199 [85]. 203 cf (2007) 233 CLR 162 at 198 [82]. Hayne The decision in Roach concerned the validity of provisions disqualifying otherwise eligible persons from voting. There being a disqualification of persons who fall within the "people" identified in ss 7 and 24, the relevant question, identified in the plurality reasons204 in Roach, was whether the disqualification was for a "substantial" reason. If there was no substantial reason for disqualifying from voting some of those who constitute "the people" by whom the two Houses of the federal Parliament are to be "directly chosen", it is evident that the law disqualifying those persons from voting went beyond the power given by s 51(xxxvi) in its operation with respect to s 30 (and thus s 8) that permits the Parliament to provide for the qualification of electors. By contrast, the present case is not concerned with the qualification of electors. The starting point for the present proceedings is that each plaintiff is entitled to enrol and, if enrolled, is entitled to vote. This case concerns whether the impugned provisions impermissibly interfere with the exercise of those entitlements. And because the focus of attention is upon what is said to be an impermissible interference with the exercise of an entitlement, it is unhelpful and distracting to pose the issue, as the plaintiffs did, by using terms like "disenfranchise", "disentitle" or "exclude". Those terms obscure the fact that the plaintiffs had the right to enrol or transfer enrolment and were bound to do so, but through their own inaction submitted their claims after the dates fixed by the impugned provisions. Question begging premises In framing the inquiries that are to be made in deciding whether an election conducted in accordance with the Act (and in particular, the impugned provisions) would not yield Houses that meet the constitutional description, care must be taken to avoid circular reasoning. Inquiries must not be framed in a way that dictates the answers that will be given to them. There are at least three different ways in which that danger emerged in this matter. The first relates to the use of what was said in Roach. If the first of the inquiries made by the plurality in Roach is to be translated and applied in this case, it is important to recognise that the immediate issue is not just: "Can the plaintiffs enrol?" The question is more complex. It has a temporal element. This case asks whether the plaintiffs, who could and should have claimed enrolment or transfer of enrolment earlier, can have their claim considered after the time fixed by the Act for the cut-off of consideration of claims. Terms like "disenfranchisement", "disentitlement" and "exclusion" mask the relevant temporal dimension to the question. 204 (2007) 233 CLR 162 at 199 [85]. Hayne Secondly, the inquiries to be made, in deciding whether an election conducted in accordance with the Act would not yield Houses that meet the constitutional description, inevitably invite comparison between the impugned provisions and the law as it stood before the 2006 Act. But it is not to be assumed that the law, as it stood before the 2006 Act, was constitutionally required. The plaintiffs contended, and neither the Commonwealth nor Western Australia intervening disputed, that the law as it stood before the 2006 Act was constitutionally valid. But that does not demonstrate that the previous law was constitutionally required. To assume that the previous law was constitutionally required would be to assume the answer to the fundamental question in issue. It would assume that answer because the law as it stood before the 2006 Act (which required the Electoral Commissioner to consider claims lodged up to seven days after the writs had issued) would be constitutionally required (as distinct from valid) only if such a system were necessary to yield Houses meeting the constitutional description. But that is the very question for decision in this case. And, of course, the same error is made if argument proceeds (as much of the plaintiffs' argument did) from the premise that the electoral legislation must permit (or may not deny or inhibit) enrolment at any time before the last reasonably available time before polling day. The premise (whether framed positively or negatively) is flawed: it assumes the answer to the question at issue in this case. Thirdly, consideration of Ch I of the Constitution, and ss 7 and 24 in particular, shows that Ch I provides for a system of representative government. It will be necessary to return in some detail to that subject. For present purposes, the point to be made is that the expression "a system of representative government" must find its relevant content in the text and structure of the Constitution. The expression (which is not used in the Constitution) is a useful description of the general nature of the form of government for which the Constitution (and Ch I in particular) provides. But the expression cannot be erected as a premise for argument about what the Constitution permits or forbids if its content is derived from sources other than the Constitution. Although, as explained earlier, the question of validity of the impugned provisions turns upon the content that is given to the expression "directly chosen by the people" it is desirable to begin by considering some of what has been said by this Court about the system of representative government established by the Constitution. Hayne Representative government In Attorney-General (Cth); Ex rel McKinlay v The Commonwealth205, the Court (by majority) held that s 24 of the Constitution does not require that the number of people or the number of electors in electoral divisions for the House of Representatives be equal. The argument that was rejected in McKinlay was founded upon the requirement of s 24 that members of the House of Representatives be "directly chosen by the people of the Commonwealth". Gibbs J said206 that "[i]f the words of s 24 are read in their natural sense, without seeking for implications or hidden meanings, they appear to have nothing whatever to do with the determination of electoral divisions within a State". In his Honour's opinion207, the Court's duty was "to declare the law as enacted in the Constitution and not to add to its provisions new doctrines which may happen to conform to our own prepossessions". He warned of the perils of circular reasoning, saying208 that: "The argument that equality of numbers within electoral divisions is an essential concomitant of a democratic system, so that in any constitution framed upon democratic principles it must have been intended to guarantee that electorates would so far as practicable contain an equal number of people or of electors, is simply incorrect – it begs the question and ignores history." (emphasis added) He continued209: "No doubt most people would agree that for the healthy functioning of a democratic system of government it is desirable that the electorate should be fairly apportioned into electoral districts whose boundaries are not gerrymandered, that the ballots should be secretly and honestly conducted, that the vote should be fairly counted and that corrupt electoral practices should be suppressed, but opinions may well differ as to how these ideals should be attained. The Constitution does not lay down particular guidance on these matters; the framers of the Constitution trusted the Parliament to legislate with respect to them if necessary, no doubt remembering that in England, from which our system of representative 205 (1975) 135 CLR 1; [1975] HCA 53. 206 (1975) 135 CLR 1 at 43. 207 (1975) 135 CLR 1 at 44. 208 (1975) 135 CLR 1 at 45. 209 (1975) 135 CLR 1 at 46. Hayne government is derived, democracy did not need the support of a written constitution." (emphasis added) Recognition that the Constitution provides for a system of representative government underpinned the series of decisions210 of the Court that culminated in Lange v Australian Broadcasting Corporation211. But in none of those cases was it necessary to examine whether the form of representative government for which the Constitution provides requires a particular form of electoral system. What was in issue in that series of decisions was the way in which the system of government worked. More particularly, did constitutional prescription of a system of representative government entail or imply a degree of freedom of communication that limited legislative power, or required some relevant development of the common law? In that context, the notion of representative government was relevantly and sufficiently expressed at a very high level of abstraction. For those purposes, its central conception is sufficiently articulated by the use of the constitutional expression "directly chosen by the people" in connection with the election of all members of both Houses of the legislature. No more particular question about the form of representative government, let alone the form of electoral system, needed to be considered in order to arrive at the conclusions expressed in that stream of authority. In McGinty v Western Australia212, this Court explored the content to be given to the term "representative government" when it is said that Ch I of the Constitution provides for such a system of government. All members of the Court concluded213 that the Constitution contained no implication affecting disparities of voting power among the holders of the franchise for the election of members of a State Parliament. Several members of the Court examined what is conveyed by reference to "representative government" in connection with the federal Constitution. 210 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1; [1992] HCA 46; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106; [1992] HCA 45; Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104; [1994] HCA 46; Stephens v West Australian Newspapers Ltd (1994) 182 CLR 211; [1994] HCA 45. See also Coleman v Power (2004) 220 CLR 1; [2004] HCA 39. 211 (1997) 189 CLR 520; [1997] HCA 25. 212 (1996) 186 CLR 140; [1996] HCA 48. 213 (1996) 186 CLR 140 at 175-176 per Brennan CJ, 184, 189 per Dawson J, 206-210 per Toohey J, 216 per Gaudron J, 229-230, 245, 251 per McHugh J, 293 per Hayne Three members of the majority (Brennan CJ, Dawson and McHugh JJ) expressly discountenanced214 the proposition that "representative democracy" or "representative government" is a valid premise for argument about the permissible content of the federal electoral system. The fourth member of the majority in McGinty, Gummow J, said215 that "[t]o adopt as a norm of constitutional law the conclusion that a constitution embodies a principle or a doctrine of representative democracy or representative government (a more precise and accurate term) is to adopt a category of indeterminate reference". It was accepted that the "principle" or "doctrine" identified can at best provide a premise for argument about the form of electoral system that entails216 "a wide range of variable judgment in interpretation and application". While it was said217 that, of itself, this may not be open to objection, difficulties were foreseen as arising when "the wide range for variable judgment depends upon, or at least includes as a significant element, matters primarily or significantly of political weight". One important source of the difficulty that attends using "representative government" (or "representative democracy") as a premise for reasoning in the present matter is that the Constitution says so little about the way in which representative government is to be implemented. As was observed in McGinty218, the Constitution prescribes only four elements of representative government. First, there is the requirement of s 24 that members of the House of Representatives be directly chosen by the people of the Commonwealth (and of s 7 that senators be directly chosen by the people of the relevant State). Second, s 24 ties the number of members of the House of Representatives to the number of senators. Third, s 24 relates the number of members chosen in the several States "to the respective numbers of their people". And fourth, s 24 provides that "five members at least shall be chosen in each Original State". But beyond these last three provisions, the whole notion of representative government, as it is expressed in the Constitution, is found in the use of the phrase "directly chosen by the people" in both ss 7 and 24. 214 (1996) 186 CLR 140 at 169 per Brennan CJ, 182-183 per Dawson J, 244 per 215 (1996) 186 CLR 140 at 269 (footnote omitted). 216 (1996) 186 CLR 140 at 269-270. 217 (1996) 186 CLR 140 at 270. 218 (1996) 186 CLR 140 at 275-276 per Gummow J. Hayne It follows, as Gummow J rightly pointed out in McGinty219, that "[t]he phrase in s 24 'directly chosen by the people of the Commonwealth' is a broad expression to identify the requirement of a popular vote". It also follows, as Gummow J again rightly pointed out in McGinty220, that the phrase used in s 24 (and I would add the like phrase used in s 7) is not to be dissected in a way that would give the words "chosen by the people" an operation distinct from s 24 (or s 7) as a whole221. Because the constitutional prescription of a form of representative government is as spare as it is, and so much is left for the Parliament to provide, it is inevitable that there are changes in the way in which the notion of representative government is given effect at the federal level. More particularly, the Parliament being given power to prescribe the method of choosing senators (s 9), and power to provide for electoral divisions (s 29), the qualification of electors for the House (s 30), and the law relating to elections for the Senate (s 10) and for the House (s 31), there can be change in each of those aspects of the features that go to make up a system of representative democracy. The limit on those powers lies in the overarching requirements of ss 7 and 24 that the Houses be "directly chosen by the people". But, as was said in Mulholland v Australian Electoral Commission222, "care is called for in elevating a 'direct choice' principle to a broad restraint upon legislative development of the federal system of representative government". In hindsight, the changes that have been made to the federal electoral system since federation may be described as evolutionary. It may be that hindsight would permit the observer to describe the changes as moving generally in a direction that represents a "development" of the particular form of representative government that is practised or established in Australia. It may also be observed that the trend of development has been to include more and more in the classes of persons who may, and now should, turn out to vote at federal elections. The introduction of a uniform federal franchise, the introduction of compulsory enrolment and then compulsory voting, the inclusion of Aboriginal Australians, first among those eligible and then among those bound to enrol and vote, and the lowering of the minimum age for enrolment from 21 years to 18 years, can all take their place in such an analysis. 219 (1996) 186 CLR 140 at 279. 220 (1996) 186 CLR 140 at 279. 221 cf the dissenting opinion of Murphy J in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 68-69. 222 (2004) 220 CLR 181 at 237 [156]; [2004] HCA 41. Hayne All of the correctness of these developments demonstrate the observation223 "that representative government is a dynamic rather than a static institution and one that has developed in the course of [the twentieth] century". And it is through the Parliament's power to legislate with respect to these matters that "the Constitution continues to speak to the present and allows for development of the institution of government by changes which may not have been foreseen a century ago or, if foreseen by some, were not then acceptable generally"224. Neither of these observations, however, permits, let alone requires, the further conclusion that it is the Constitution which has "developed" or that the concept of "representative government" has developed or evolved into a constitutional norm. A conclusion of that kind could be founded only in the text or structure of the Constitution. And because the very premise for the observed processes of development is that the Constitution is silent about those matters, leaving it to the Parliament to undertake the processes of development, that further step cannot be taken. There is no textual or structural foundation for it. Rather, as Gummow J rightly said225 in McGinty: "It does not follow from the prescription by the Constitution of a system of representative government that a voting system with a particular characteristic or operation is required by the Constitution. What is necessary is the broadly identified requirement of ultimate control by the people, exercised by representatives who are elected periodically. Elements of the system of government which were consistent with, albeit not essential representative government might have been constitutionally entrenched or left by the Constitution itself to the legislature to provide and modify from time to time. This is what was done." (emphasis added) for, "Representative government" was regarded by many nineteenth century writers as "the Ideally Best Form of Government"226. Their works were familiar to the framers of the Constitution and to those in the Parliament who debated the Bill for what became the Commonwealth Electoral Act 1902 (Cth) ("the 1902 Act"). The enduring controversies about electoral systems (reflected, for example, in the application of the Hare-Clark system in Tasmania) as well as the 223 McGinty v Western Australia (1996) 186 CLR 140 at 280 per Gummow J. 224 McGinty (1996) 186 CLR 140 at 281 per Gummow J (footnote omitted). 225 (1996) 186 CLR 140 at 285. 226 Mill, Considerations on Representative Government, (1861), Ch III, "That the Ideally Best Form of Government is Representative Government". Hayne course of debates in the Parliament in connection with the Bill for the 1902 Act show, however, that no one writer's views about representative democracy were seen as commanding the field. It is not right in those circumstances to see the provisions of Ch I of the Constitution, with their important but spare specification of the system of government, as embracing the views of any one of those writers, be it John Stuart Mill or anyone else. To read Ch I in that way denies the evident constitutional intention to permit the Parliament to decide many important questions about the structure and content of the electoral system without constitutional restriction beyond the requirement that each House be directly chosen by the people. To assume otherwise is, as Gibbs J said227 in McKinlay, to beg the question and ignore history, or it is, as his Honour also said228, to add to the Constitution's provisions "new doctrines which may happen to conform to our own prepossessions". Consideration of whether each House, if elected according to mechanisms that include the impugned provisions, will meet the constitutional requirement necessitates examination of what is meant by "directly chosen by the people". It also requires consideration of the place that the relevant cut-off dates have in the whole scheme of arrangements made by the Act for enrolment and voting. It will be necessary to say something further about both of those matters. Before doing that, however, I should identify some features of the plaintiffs' arguments. The plaintiffs' arguments As already noted, the plaintiffs' argument was directed to establishing first, that the cut-off dates "disqualified" them from exercising their franchise as adult Australian citizens, and second, that the "disqualification" was for no "substantial" reason. The plaintiffs went so far as to submit that their "disqualification" was properly described as "capricious", but the weight of their argument was placed on the proposition that the "disqualification" was not reasonably appropriate and adapted to the end of yielding Houses of the Parliament that would meet the constitutional description of "directly chosen by the people". The plaintiffs accepted that the Act could prescribe a cut-off date for consideration of claims for new enrolment and for transfer of enrolment. That is, the plaintiffs accepted that prescription of a cut-off date could be a measure reasonably appropriate and adapted to the end identified, and further accepted that the particular prescriptions made after the 1983 election were of that kind. 227 (1975) 135 CLR 1 at 45. 228 (1975) 135 CLR 1 at 44. Hayne The plaintiffs' acceptance of those propositions reveals features of their arguments which should be identified. First, their claim that the cut-off provisions made by the 2006 Act are invalid does not depend upon how many are affected. The facts agreed by the parties did not establish that allowing a longer period for last minute compliance necessarily results in fewer missing the cut off, and more being correctly enrolled. At the last election before the 2006 Act introduced the impugned provisions, 168,394 people lodged claims for enrolment and transfer after the close of rolls; in 2007, the equivalent number was about one-third smaller: Secondly, prescription of any cut-off date before polling day will inevitably mean that some will miss the cut off. The Court was enjoined, more than once, to recognise that it is human nature for some (it was said especially the young) to leave compliance with obligations to the last minute. And if that is right, some, like the plaintiffs, will leave compliance until after the time appointed, whatever that time may be. It follows that, when the plaintiffs submitted that the impugned provisions are not reasonably appropriate and adapted to serve an end consistent or compatible with the maintenance of the constitutionally prescribed system of government, the "end" that the plaintiffs identified must be expressed in such a way that it connotes maximum participation in the poll by those who are eligible to be enrolled. As will be seen, however, there is no foundation for identifying maximum participation as an element of the constitutionally prescribed system of government. "Directly chosen by the people" The phrase "directly chosen by the people", when used in ss 7 and 24 of the Constitution, conveys a number of ideas. It is neither necessary nor appropriate to attempt to explore all aspects of the meaning that is to be attributed to the phrase. It is not to be doubted, however, that consideration of whether members and senators are "directly chosen by the people" requires examination of the laws that govern not just the franchise, but also enrolment to vote, and the exercise of the right of an enrolled elector to cast his or her vote. Roach was a case about the first kind of issue: laws that govern the franchise, or what s 30 of the Constitution calls "the qualification of electors". This case is not. This case concerns enrolment to vote. The members of each House of the Parliament are elected on a franchise which, subject to exceptions that are not engaged in respect of the plaintiffs, is a universal adult franchise embracing all "the people of the Commonwealth" Hayne spoken of in s 24, and all "the people of the State" referred to in s 7. That some who are enrolled to vote, and therefore entitled and bound to vote, do not cast a ballot at an election does not deny that the elected members of each House of the Parliament are "directly chosen by the people". That some who are bound to enrol do not enrol, and therefore do not vote, does not deny that the members of each House are "directly chosen by the people". The plaintiffs' argument was that the absence from the appropriate roll of some, who (belatedly) claimed their entitlement to be on that roll, does mean that the members of each House are not directly chosen by the people. Such a conclusion would be sharply at odds with the recognition that neither the failure to vote by some entitled to vote, nor the failure to claim enrolment by some entitled to enrol, leads to that conclusion. in ways History teaches that, in some countries, registration and voting systems that have systematically have been devised and administered disadvantaged particular groups in the society. But the plaintiffs' complaint in the present case was not of that kind. Rather, the plaintiffs' complaint was directed to the consequences that follow from the impartial administration of the Act in accordance with its terms. And it was a complaint that hinged about the observation that they, and others in like case, cannot cast a vote in this election, in the Division in which they live, because they have not complied with their statutory obligations. They observed that these consequences of non-compliance with the Act fall chiefly upon the young. They did not say, however, that that fact leads to any relevant constitutional consequence or engages any relevant constitutional principle. The plaintiffs' complaint directed attention to what would happen in connection with this election, as opposed to what was lawfully permitted and required to happen in connection with the election. That is, it was said to be constitutionally significant that tens of thousands of persons, who were eligible and required to enrol and vote, had not taken the steps necessary to enable them to vote, in the Division in which they reside, at the election. A necessary step in the plaintiffs' argument that the impugned provisions are invalid was to observe that they, and others in like case, had only a very short time to respond to the stimulus of an election announcement by claiming enrolment, or a transfer of enrolment. They submitted that they should have had a longer time to respond to that particular stimulus. That there were other stimuli to enrolment was dismissed as not to the point. Making it an offence not to enrol forthwith was treated as not a sufficiently effective stimulus. Recognition that few federal elections have been called without a great deal of prior media discussion and speculation about what date will be fixed was treated as irrelevant. The plaintiffs' submissions hinged about the proposition that nothing but a Prime Ministerial announcement fixing the date for an election could sufficiently stimulate those who had not enrolled or transferred enrolment to do what they were legally bound to do. Hayne What will in fact happen at this election (as distinct from what not only could but should have happened, had the Act been obeyed) bears upon whether each House is "directly chosen by the people" only if that phrase directs attention to the number of persons who actually vote at an election and requires that that number be as large as possible. Or, restating the same proposition in words used in the course of argument, what will happen at this election bears upon satisfaction of the constitutional requirements only if ss 7 and 24 at least connote, if not require, that there be "maximum participation" by the people. There are several reasons why that view of "directly chosen by the people" should not be adopted. First, it is necessary to recognise the distinction between factual participation of "the people" in an election, and the legal opportunity for "the people" to participate in an election. The former idea requires consideration only of what has occurred, or will likely occur, at one or more particular elections. It attaches no significance to the observation that the failure to enrol is an offence. By contrast, the latter requires examination of the legal framework within which those events occur. In particular, it requires examination of the legal and practical operation of the relevant statutory provisions. The former is the field of political science and behavioural analysis. The latter is the field of constitutional law. Second, it is necessary to recognise that compulsory voting was not, and was not seen as, a necessary corollary of ss 7 and 24 generally, or of the particular constitutional description of the Houses as "directly chosen by the people", when the Constitution first took effect. Compulsory voting was not introduced until 1924229. When introduced, the validity of compulsory voting was challenged but upheld by this Court in Judd v McKeon230. The introduction of compulsory voting was seen by all members of the Court in that case231 as a matter for the Parliament to decide, not as a matter of constitutional necessity. And of course none of the transitional electoral provisions picked up from the States and applied by ss 10 and 31, "[u]ntil the Parliament otherwise provide[d]", required compulsory voting or compulsory enrolment. Third, recasting the plaintiffs' argument as a complaint that the impugned provisions unreasonably deny them the opportunity to enrol and vote puts all the weight of their argument on the content that is given to the word "unreasonably". 229 Commonwealth Electoral Act 1924 (Cth), s 2, inserting s 128A in the Act. 230 (1926) 38 CLR 380; [1926] HCA 33. 231 (1926) 38 CLR 380 at 383 per Knox CJ, Gavan Duffy and Starke JJ, 385 per Isaacs J, 387 per Higgins J, 390 per Rich J. Hayne But whatever content is given to that word, the proposition assumes, without demonstration, that the electoral legislation must permit (that is, it must not deny or inhibit) enrolment at any time before the last reasonably available time. And as explained earlier in these reasons, that premise is flawed because it assumes the answer to the question at issue. Moreover, the notion that there was an "unreasonable" denial of the opportunity to enrol when the plaintiffs (and others in like case) have had not just the opportunity, but the obligation, to do so forthwith upon becoming entitled to claim enrolment or transfer of enrolment is, on its face, logically and legally unsound. It could have a legal basis only if the Constitution requires maximum participation, and there is no textual or other sufficient foundation for that conclusion. Only the system of representative government for which the Constitution provides has now changed or developed into either a system where compulsory enrolment and voting are constitutionally essential elements of the system, or a system where the Parliament must maximise the opportunity to enrol and vote, would the necessary premise of the plaintiffs' argument (that the Constitution requires that the electoral law must facilitate and promote maximum participation by the people) be made good. The only textual way in which that could be done would be by reading "directly chosen by the people" in ss 7 and 24 as now requiring maximum participation, or by drawing some wider implication from the observation that those provisions require a system of representative government. For the reasons given earlier in discussing what is meant by "representative government", that step cannot and should not be taken. What has changed and developed since federation is the way in which successive Parliaments have exercised the power given by the Constitution to give practical operation to a system of representative government of which only the broadest outlines are fixed by the Constitution. The constitutional requirements have not altered. The provisions of ss 7 and 24, whether generally or in their use of the phrase "directly chosen by the people", have not taken on any different, or more prescriptive, meaning as a result of the various steps taken by successive Parliaments to adjust the electoral system. That is not to say, of course, that maximum participation in the electoral process cannot readily be seen as a desirable civic value and as a worthy legislative objective. But whether and to what extent it is pursued is a choice which the Constitution confides to the Parliament. It is through legislation of the Parliament that the democratic system of government has developed, not by attributing a new and different meaning to the exiguous constitutional text. There is no constitutional foundation for the plaintiffs' arguments. Neither s 7 nor s 24, with their use of the expression "directly chosen by the people", requires the Parliament to establish or maintain an electoral system which will maximise the participation of eligible electors. Neither s 7 nor s 24, alone or in combination with the provisions of Ch I, or the Constitution more generally, provides for a system of representative government in which there can be no Hayne fixing of the rolls of eligible electors at, or very soon after, the issue of the writs to begin the electoral process. An election conducted in accordance with the impugned provisions would yield Houses of the Parliament "directly chosen by the people". Although these are reasons enough to conclude that the plaintiffs' proceeding failed, it is as well to go on to consider some more particular aspects of their arguments. As noted earlier in these reasons, the plaintiffs put their case by reference to the two inquiries described in Roach: is there a disqualification from what otherwise is adult suffrage; is the disqualification not for a substantial reason? As already explained, there is no disqualification from what otherwise is adult suffrage. The plaintiffs were not barred or inhibited from exercising their entitlement to enrol and vote. Through their own inaction and failure to perform their obligations they claimed enrolment or transfer of enrolment after the due date. They left their claim until after the "last minute". There being no disqualification, the second question posed in Roach, about no substantial reason, does not arise. It is, nonetheless, desirable to consider it. To do that, it is necessary to make a more detailed examination of the historical and legislative context in which the issues in the present litigation are tendered for decision. The historical and legislative context Since the enactment of s 8 of the Commonwealth Electoral Act 1911 (Cth) inserting s 61C in the 1902 Act, enrolment to vote at federal elections has been compulsory. As enacted, s 31 of the 1902 Act provided that all persons qualified to vote at a federal election were qualified to have their name on the appropriate roll. The Commonwealth Franchise Act 1902 (Cth) provided (with some exceptions that need not be considered) that all British subjects resident in Australia for six months continuously, who had attained the age of 21 years, and whose names were on an Electoral Roll, were entitled to vote. Although enrolment was not compulsory in 1902, the first federal Electoral Rolls saw more than 95 per cent of eligible voters enrol. And in some States the numbers on those first federal Electoral Rolls exceeded the numbers on the State Rolls. Compulsion to enrol necessarily has two consequences. First, a time for compliance with the obligation must be fixed. Second, consequences (usually penal) must be identified as following from failure to perform the obligation. Section 61C of the 1902 Act, as inserted by the 1911 Act, obliged every person entitled to be enrolled as an elector, and who was not so enrolled, to fill in and sign a form of claim and "forthwith" send or deliver it to the proper officer. Regulation 6B(2) of the Electoral and Referendum Regulations 1912 (Cth) provided that failure to send or deliver a claim within 21 days of becoming entitled to enrol was an offence punishable by a penalty not exceeding £2 or, in Hayne the case of a first offence, not exceeding 10 shillings. As will later be explained, the Act, as it now stands, makes generally similar provisions fixing the time by which the obligation to enrol is to be performed, and fixing a penalty for failure to comply with the obligation. The plaintiffs' case is that, despite the legislature validly obliging enrolment forthwith, and providing for penal consequences if that obligation is not performed, the legislature not only must provide a further opportunity for performance of the obligation to enrol, but also must provide for that opportunity to be taken up after an election has been announced and the writs that commence the electoral process have been issued. Since 1973232, subject to some exceptions that are not immediately relevant, all Australian citizens who have attained 18 years of age have been qualified for enrolment. If qualified for enrolment, a person who lives at (and for the preceding period of one month has lived at) an address in a Division is entitled233, in respect of residence at that address, to have his or her name placed on the roll for that Division. Special provision is made in the Act for eligible overseas electors234, the spouses and children of eligible overseas electors235, Norfolk Island electors236 and itinerant electors237, but none of those provisions need be examined here. The Act allows for provisional claims for enrolment by applicants for citizenship238 and for claims for age 16 enrolment239, but again, nothing turns directly on the detail of those provisions. A person who is entitled to enrolment for a Division is bound240 "forthwith" to fill in and sign a claim and send or deliver that claim to the Electoral Commissioner. That obligation extends to those eligible for enrolment for the first time and to those who, because of a change of residence, are bound to 232 Commonwealth Electoral Act 1973 (Cth), s 3 amending s 39(1) of the Act. See now s 93 of the Act. 234 ss 94, 94A. 236 ss 95AA, 95AB, 95AC. 238 s 99A. Hayne claim transfer of enrolment. Apart from those whom the Act describes as qualified Norfolk Islanders, every person entitled to have his or her name placed on the roll for any Division, whether by way of enrolment or transfer of enrolment, and whose name is not on the roll upon the expiration of 21 days from the date upon which that person became so entitled, is guilty of an offence241 unless he or she proves that non-enrolment is not a consequence of failure to make a claim. A person enrolled for a Division who has changed his or her place of living to another address in the same Division, and has lived at the new address for one month, but does not give written notice of the new address within 21 days of the end of the one month period, is guilty242 of an offence. Submission of a claim for enrolment or transfer precludes243 prosecution for an offence of not making a claim, if the offence was committed before the claim was made. Enrolment governs more than the entitlement of individuals to vote. Distributions of each State and Territory into Electoral Divisions are made by reference to the numbers of electors enrolled in each Division, and the average divisional enrolment in relation to the relevant State or Territory. Each month, the Electoral Commissioner must244 ascertain the number of electors enrolled in each Division, determine the average divisional enrolment in respect of each State and Territory, determine the extent to which the number of electors enrolled in each Division differs from the average divisional enrolment, and cause a statement of the matters so ascertained and determined to be published in the Gazette. Whenever it appears to the Electoral Commission, from those statements in the Gazette, that more than one-third of the Divisions in a State are, and for more than two months have been, malapportioned, a redistribution must So far as the enrolment of individual electors is concerned, several observations are to be made about the Act. First, Pt IX of the Act provides for objections to enrolment of a person, and Pt X for review of decisions to reject a claim for enrolment or to remove a person's name from a roll. A decision to 242 s 101(5) and (6). 244 ss 55A, 58. Hayne remove or omit a person's name from a roll is also amenable to judicial review under s 75(v) of the Constitution246. A decision to accept a claim for enrolment, or transfer of enrolment, cannot be challenged except by the process of objection under Pt IX of the Act. But, since the 2006 Act, the Electoral Commissioner has been forbidden247 to remove an elector's name from a roll, as a result of the objection process, during the period between 8 pm on the date of the writ for an election and the close of the polling at the election. That is the same period as is now fixed by the Act as the period during which claims for new enrolment cannot be considered. Before the 2006 Act, the prohibition on removing an elector's name was also tied to the period during which claims for new enrolment could not be considered: the period beginning seven days after the date of the writs. Further, s 361(1) of the Act provides that, on an Electoral Petition to the Court of Disputed Returns, "the Court shall not inquire into the correctness of any Roll". It follows, so the Commonwealth submitted, that alleged deficiencies in the Electoral Rolls cannot be agitated, after the election, in a challenge to the result. It also follows, however, that questions about significance of enrolment have a wider focus than the position of any particular individual. It is necessary to consider not only the effect of the Act on individuals, but also the place that the Electoral Rolls play in the conduct of an election as a definitive statement of entitlement to vote. Closing the Electoral Rolls – history Between 1902 and 1983, a person's name could not be added to an Electoral Roll (whether pursuant to a claim to new enrolment or a claim to transfer enrolment) after the writs had issued248. Until 1983, there was a practice, perhaps even a convention249, that writs for an election would not issue until at least seven days after the public announcement of an intention to call an election. Yet such a practice or convention appears not to have been always followed. The parties in the present matter agreed that, in 1931, only two days elapsed between the announcement of an election and issue of the writs and that, in 1949, only five days elapsed. And the practice, or convention, was one which depended 246 Snowdon v Dondas (1996) 188 CLR 48 at 72; [1996] HCA 27. 248 Commonwealth Electoral Act 1902 (Cth), s 64; Commonwealth Electoral Act 1918 (Cth), s 45 (as it then stood). From 1910 the writs were taken to have issued at 6 pm on the day of issue: Commonwealth Electoral Act 1909 (Cth), s 12, inserting s 64(2) in the 1902 Act. 249 See R v Pearson; Ex parte Sipka (1983) 152 CLR 254 at 266 per Murphy J; [1983] HCA 6. Hayne upon there being an announcement of intention to dissolve the Parliament (and call an election) before the tendering of advice which would lead to the Governor-General in Council causing writs to be issued for a general election of members of the House of Representatives. Section 5 of the Constitution permits the Governor-General "by Proclamation or otherwise, [to] prorogue the Parliament, and ... in like manner dissolve the House of Representatives". Section 32 of the Constitution requires that the writs issue "within ten days ... from the proclamation of a dissolution" of the House. But s 32 does not preclude issuing the writs sooner than that outer limit of 10 days. Section 12 permits the Governor of any State to cause writs to be issued for elections of senators for the State. And this was done in every State, for this election, on 19 July 2010, the same day as writs were issued for the election of members of the House of Representatives. In 1983, writs for the election were issued on the day after the election was announced. As a result, those who, at 6 pm on that day, were in default of their obligation to enrol, or seek transfer of their enrolment, could not have their claims to enrolment on the relevant federal Electoral Roll considered. Their claims to enrolment on the relevant State Roll, however, were allowed. Proceedings were brought in this Court250 claiming that because the persons concerned had the right to vote at elections for the more numerous House of the Parliament of a State, s 41 of the Constitution required that they not be prevented by any law of the Commonwealth from voting at elections for either House of the Parliament of the Commonwealth. The Court held (Murphy J dissenting) that the right to vote in s 41 was that possessed under a State law when the federal franchise was established, and that s 41 does not confer a right to vote in a federal election on any person who, from time to time, has the right to vote at a State election. Accordingly, the applications were dismissed. Arguments of the kind advanced in this matter, though available in R v Pearson; Ex parte Sipka, were not put to or considered by the Court in that case. Rather, Sipka was decided without any direct challenge to the Commonwealth's submissions that the then provisions of the Act providing for closure of the rolls on the day of issue of the writs were "authorised by ss 9, 10, 29, 31 and 51(xxxvi) of the Constitution [and] render[ed] effective those provisions of the Act providing for an electoral roll and for enrolment"251. Nor was there any direct challenge to the further argument on behalf of the Commonwealth252 that "[a] provision which closes off the roll by reference to the date of issue of the writs for an election facilitates the exercise of the franchise". 250 Sipka (1983) 152 CLR 254. 251 (1983) 152 CLR 254 at 256. 252 (1983) 152 CLR 254 at 256. Hayne Just as the decision in Sipka does not foreclose the plaintiffs' arguments in this case, the longevity of the provisions which gave rise to the litigation in Sipka does not preclude the plaintiffs from success in this litigation. Nor is it necessary for the plaintiffs to assert that the arrangements about closing of the Electoral Rolls which existed between 1902 and 1983 were constitutionally invalid. While the better view is that those arrangements were constitutionally valid, they were administered in a context where, at least for the most part, controversies of the kind that now arise could not have been tendered for consideration by this Court as a "matter". That is not to say that the constitutional validity of the arrangements that persisted during those years up to the early 1980s depended upon the existence of some imperfectly observed political practice or convention about when the proposal to hold an election would be announced. It is to observe only that the factual circumstances which underpin the claims brought by these plaintiffs did not arise, and did not arise because of the way in which electoral announcements were made. It is further to be observed, however, that, if the present election had been announced one week before it was, but writs had been issued on the day they were, the plaintiffs would presumably accept that the impugned provisions governing consideration of claims for new enrolment or transfer of enrolment would be valid in their operation. Following the 1983 election, the Act was amended253 to provide that the period in which a person's name could not be added to the roll began at 6 pm on the day the rolls close, and that the rolls closed seven days after the issue of the writs. In 1995, the cut-off time of 6 pm was changed254 to 8 pm. Between the 1983 election and the enactment of the 2006 Act there was debate, from time to time, about what provision should be made for cutting off consideration of claims for new enrolment, or claims for transfer of enrolment, once an election had been called. Participants in the debate appealed to a variety of considerations in aid of particular proposals. Those considerations included, but were not limited to, questions of the "integrity" of the rolls, the "accuracy" of the rolls and what would be the "more democratic" solution. And the proposals were politically controversial. The 2006 Act was enacted over the opposition of the then opposition party and some third party and independent senators. 253 Commonwealth Electoral Legislation Amendment Act 1983 (Cth), ss 29 and 45, inserting, among other provisions, ss 43(4) and 61A in the Act. (The Commonwealth Electoral Legislation Amendment Act 1984 (Cth) provided for the renumbering of the provisions of the Act.) 254 Electoral and Referendum Amendment Act 1995 (Cth), Sched 1, Item 17. Hayne The 2006 amendments It is not necessary, however, to trace the detail of the controversy, the arguments that were deployed in the course of the debates in the Parliament, or the extended debates that took place in Committees of the Parliament, especially the Joint Standing Committee on Electoral Matters ("JSCEM"). Nor is it useful to pause to examine the way in which words like "integrity" or "accuracy" can or should be used in describing the state of the Electoral Rolls. Two points are presently important. First, there have been essentially three different forms of statutory regulation of federal electoral enrolment since federation. From federation to 1983, and thus both before and after enrolment was made compulsory in 1911, no claim for new enrolment or transfer of enrolment could be considered if made after the writs for an election were taken to have issued. Between 1983 and 2006, claims for new enrolment and transfer of enrolment could be considered if made within seven days after the writs for an election were issued. Since 2006, claims for new enrolment could not be considered if made after the day on which the writs were issued, and claims for transfer of enrolment could not be considered if made later than the third working day after the date of the writs. Secondly, to the extent to which it is necessary or appropriate to examine why the 2006 Act, in the respects relevant to this matter, was framed in the way it was, several points are to be noticed. Because the changes made by the 2006 Act were politically controversial, debate about them tended to focus upon what was seen as politically persuasive. Issues about the "integrity" or "accuracy" of the rolls had been examined by the JSCEM in its reports on the federal elections held in 1996 and 2004 and in other more particular reports of the JSCEM published in May 2001 and October 2002. The issues were also examined in submissions and reports by the Australian National Audit Office and the Australian Electoral Commission. The central focus of much of what was said in those documents was on enrolment fraud. But reference was also often made to the costs and difficulties associated with the facts that many new and existing electors were not making enrolment claims when they should, but were delaying them to the time when an election had been announced. In the JSCEM report on the conduct of the 2004 federal election ("JSCEM 2004 Report"), published in September 2005, the Committee noted255 that 60.5 per cent of enrolment transactions that had occurred 255 Australia, The Parliament, Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal (Footnote continues on next page) Hayne during the close of rolls period would not have been required if electors had made the necessary claims when required to do so. The Committee expressed256 the belief that "the seven day close of roll period for Federal elections actually encourages electors and potential electors to neglect their obligations in respect of enrolment, believing that they can play 'catch up' during the close of rolls period". The Committee noted257, with what it described as "a high degree of concern", that "a significant number of electors" had not updated their enrolment details despite contact by the Australian Electoral Commission ("the AEC") reminding them of their obligations. The Committee continued258: Statistics provided by the AEC indicate, that despite AEC efforts and the significant amount of taxpayer funds expended by them in contacting electors prior to elections being announced, that same pattern is repeated election after election. Not only do electors act unlawfully in not enrolling when entitled, they cause the wastage of a significant amount of taxpayer funds that the AEC is obliged to expend on postage and other measures, making repeated attempts to persuade those same electors to update their details on the electoral roll." (footnote omitted) On the subject of fraud, the Committee said259: The Committee also agrees that the current close of roll arrangements present an opportunity for those who seek to manipulate the roll to do so at a time where little opportunity exists for the AEC to undertake the thorough checking required [for] ensuring roll integrity. The Committee believes that those who argue for the retention of the seven day close of rolls and who promote the argument that there is no proof that enrolment fraud is Election and Matters Related Thereto, (September 2005) ("JSCEM 2004 Report") 256 JSCEM 2004 Report at 35 [2.116]. 257 JSCEM 2004 Report at 35 [2.118]. 258 JSCEM 2004 Report at 35. 259 JSCEM 2004 Report at 35-36. Hayne sufficiently widespread to warrant any action, have missed the point. The fundamental issue facing this Committee is to prevent any such fraud before it is able to occur. Failure to do so would amount to neglect. While the risk exists that fraud sufficient to change the result of an election might occur, we are failing in our duty to protect and preserve the integrity of our electoral system and our democratic processes and principles." The Committee recommended that the rolls be closed at 8 pm on the day that the writ for an election is issued. It said260 of that change: This change, along with the introduction of proof of identity and address measures for enrolment and provisional voting, will ensure the electoral roll retains a high degree of accuracy and integrity, while reminding electors that the responsibility for ensuring that the electoral roll is updated in a timely manner rests with them." (emphasis addded) This being the history of the matter, it is not surprising that neither the Explanatory Memorandum, nor the Second Reading Speech, for the Bill that became the 2006 Act canvassed in any detail the arguments for the alterations that were to be made by the proposed law. Those arguments had already been extensively examined. Rather, the Explanatory Memorandum proceeded by reference to a Government Response to the JSCEM 2004 Report, and the Second Reading Speech said little more than that the Bill "contains reform measures arising from some of the government supported recommendations" of that report. Neither the Explanatory Memorandum nor the Second Reading Speech contains any, or at least any elaborated, discussion of the mischief to which the Bill was directed. Nonetheless, read in the context of the JSCEM 2004 Report, and the Government Response to that report, it is evident that, in respects relevant to the present matter, the Bill was intended to provide what the Commonwealth described in its submissions as "prophylactic" measures against fraud, while reminding electors, as the JSCEM 2004 Report said261, "that the responsibility for ensuring that the electoral roll is updated in a timely manner rests with them". 260 JSCEM 2004 Report at 36. Hayne The plaintiffs submitted that there was no "substantial reason for abrogating the seven day period" provided by the 1983 legislation and that there was "no evidentiary basis for what in fact occurred" (scil. the changes made by the 2006 Act). The plaintiffs necessarily stopped short of submitting that the views stated in the JSCEM report that are set out above were not held by the majority of the members of the Committee. The plaintiffs necessarily stopped short of submitting that what was said in the report masked other, ulterior, and impermissible purposes. The plaintiffs necessarily stopped short of such submissions because there was no foundation in the material for either submission. But what then was the legal proposition on which the plaintiffs relied when they spoke of no "evidentiary basis" and no "substantial reason"? Shorn of forensic flourishes, the plaintiffs' argument must be understood as being that the impugned laws were not reasonably appropriate and adapted to serving an end consistent or compatible with the maintenance of the constitutionally prescribed system of government. So understood, the plaintiffs' argument proceeded by asserting that the impugned provisions were not reasonably appropriate and adapted to preventing electoral fraud, because there was no demonstration that there had been any significant incidence of fraud before the 2006 Act, and (perhaps) because there were other means of preventing fraud that were consistent with maintaining the seven day period fixed by the 1983 Act. And the plaintiffs then coupled those assertions with the further proposition (already noticed in these reasons) that the "practical operation" of the impugned provision was to "disenfranchise" the plaintiffs and others in like case. It is convenient to consider the plaintiffs' argument in steps: first, the "practical operation" of the impugned laws; second, the question of mischief and, in particular, electoral fraud; and third, the significance of the availability of other measures. Practical operation the Identifying the practical operation of laws as disenfranchising the plaintiffs and others lay at the very centre of the plaintiffs' case. I have already pointed to the difficulties that follow from speaking of the plaintiffs as having been disenfranchised. Those same difficulties inhere in the assertion that the practical operation of the provisions cutting off consideration of claims for new enrolment and transfer of enrolment "disenfranchises" the plaintiffs. And the difficulties encountered are not just verbal, they are substantial. impugned The complaint which the plaintiffs make about the so-called "practical operation" of the impugned provisions depends upon other, related provisions of the Act having been disobeyed by the plaintiffs. If the plaintiffs had performed their obligations under the Act when they were bound to do so, the impugned provisions would not be engaged. Thus the "practical operation" of the law to which the plaintiffs point is an operation that depends upon the extent to which Hayne other provisions of the law of which the impugned provisions form a part have been disobeyed. This asserted understanding of the "practical operation" of a law is entirely novel and should not be adopted. The constitutional validity of the impugned provisions cannot turn upon the extent to which related statutory obligations have been disobeyed. No less importantly, as has already been explained, the assertion that the practical operation of the impugned provisions disenfranchises the plaintiffs necessarily depends on first adopting one, if not more than one, of the three forms of question begging premises identified earlier in these reasons. The assertion about practical operation depends (at least in part) upon masking the relevant temporal dimension of entitlement to enrol. The assertion assumes that there is a constitutional requirement that last minute enrolment be permitted. The assertion then seeks to justify that assumption by an appeal to what are assumed, rather to be constitutional norms of "representative government". The assumptions dictate the answer to the particular question that arises in the proceedings. than demonstrated, Mischief The relevant provisions of the 2006 Act were proposed in the JSCEM 2004 Report, not just to prevent fraud, but also to encourage timely observance of the obligations to enrol. It follows that to focus only on questions of fraud prevention ignores another intended purpose of the legislation. That other intended purpose cannot be discarded from consideration as irrelevant. It cannot be dismissed as an untenable view. Even if attention were to be confined to questions of fraud prevention or inhibition, the plaintiffs' argument (that because there was no demonstration of any significant incidence of fraud before the 2006 Act, the impugned provisions are not reasonably appropriate and adapted to an end of fraud prevention) is logically and legally flawed. The logical flaw is evident. The absence of proven instances of fraud does not demonstrate that no new or different step can or should be taken to prevent it. Whether any further step should be taken is a matter of judgment. Nor does pointing to the existence of other means of preventing fraud entail that no new or different step can or should be taken. Again, the question is one for judgment. The legal flaw in the reasoning is of the same kind as has already been observed in connection with the question of practical operation. The plaintiffs' arguments about what is reasonably appropriate and adapted depended upon one or more of the question begging premises that have been identified. It will be recalled that the plaintiffs' argument denied that the impugned provisions are reasonably appropriate and adapted to serving an end consistent or compatible with the maintenance of the constitutionally prescribed system of Hayne government. This was then particularised by saying that the impugned provisions were not reasonably appropriate and adapted to an end of fraud prevention and by saying that no other relevant end was demonstrated. But the plaintiffs accepted that provisions for an Electoral Roll, the details of which were to be fixed at a date before polling day, are reasonably appropriate and adapted to an end consistent with the maintenance of the constitutionally prescribed form of government. That acceptance necessarily depends on accepting the argument put by the Commonwealth in Sipka, noted earlier, that a provision which closes off the rolls by reference to the date of issue of the writs for an election facilitates (and, I would add, does not impede or detract from) the exercise of the franchise. To say, as the plaintiffs did, that a provision closing the rolls seven days after issue of the writs is valid, but a provision closing the rolls on the day of the writs (or in the case of transfers, three days after the writs) is not, necessarily proceeds from a premise that provision must be made for last minute enrolments: "last minute" not just in the sense of after the time fixed by the Act for performance of the obligation to enrol, and proximate to an election, but "last minute" in the sense of after the announcement of the election. The premise begs the question. The premise was not, and cannot be, established. Availability of other measures The plaintiffs' references to available alternative measures took two distinct forms. First, as already noted, much of the plaintiffs' argument proceeded by comparison with the system of allowing seven days for lodging claims for enrolment or transfer of enrolment that had been introduced in 1983. But, as already explained, those comparisons are significant only if the unstated premise for the argument is that there must be legislative provision enabling last minute enrolments. The second form of reference to alternative measures was made in connection with the argument that fixing cut-off times earlier than those fixed in 1983 was not necessary for elimination of fraudulent practices. In this connection, reference was made to what the Australian Electoral Commission has done in two programs: a Continuous Roll Update or "CRU" program and the development of a computerised roll management system known as "RMANS". In each year since 1999-2000, many millions of dollars have been spent by the Australian Electoral Commission on Electoral Roll Review and Continuous Roll Update activities. The latter form of activity required data matching, using RMANS, between entries on the Electoral Rolls and other data held by other government departments or agencies. No doubt processes of data matching can help to avoid registration of fraudulent enrolments. It is an altogether different question (not addressed in the evidence or in argument) whether those techniques can be usefully engaged in dealing with a large number of last minute claims for enrolment. It is this latter question which is important when considering the impugned provisions. (In that Hayne regard it must be remembered that the Commission dealt with more than 500,000 claims lodged between the announcement of the 2010 election and the cut-off dates fixed according to the impugned provisions.) To make good the plaintiffs' proposition, it would be necessary to demonstrate that allowing the Australian Electoral Commission a little more time for checking last minute enrolments than was available under the 1983 provisions would not make, and could not be supposed to make, any contribution to avoidance of fraud. The general references that the plaintiffs made to processes of continuous roll updating and the availability of data matching techniques and facilities fell well short of demonstrating that proposition. Be this as it may, it must also be recalled that the JSCEM 2004 Report made two points: one about preventing fraud and one about trying to encourage better compliance with existing requirements by shortening the time for last minute enrolments. In that latter regard it may be noted that, despite Electoral Roll Review and Continuous Roll Update activities by the Australian Electoral Commission, the estimated number of eligible persons not enrolled generally increased during the period between June 1999 and December 2009262. The parties agreed that, at the close of rolls for the 2004 federal election, about 91.5 per cent of eligible voters were enrolled. At the close of rolls for the 2007 election (after the amendments made by the 2006 Act had come into force) the proportion enrolled had risen to about 92.3 per cent of eligible voters. By 31 December 2009, that proportion had dropped to about 90.9 per cent. It was estimated that, at 31 December 2009, nearly 1.4 million eligible persons were not enrolled. For the 2001, 2004 and 2007 elections, the numbers "missing" from the rolls were about 0.9 million, 1.2 million and 1.1 million (respectively). Thus, while the particular number missing varied from election to election (and actually dropped after the amendments made by the 2006 Act) the general trend over the 10 years between 1999 and 2009 was for the number missing to increase, and for the percentage of eligible electors who were enrolled to diminish. The plaintiffs did not demonstrate that shortening the time for last minute enrolment could have no effect on the general level of compliance with the obligation to enrol, or transfer enrolment, forthwith upon becoming entitled to enrol, or required to transfer enrolment. Yet that proposition was a necessary step to making good the plaintiffs' contention that the 2006 Act, so far as now relevant, was not reasonably appropriate or adapted to serving an end consistent or compatible with the maintenance of the constitutionally prescribed system of government. 262 Australia, Australian Electoral Commission, "AEC Submission to the Joint Standing Committee on Electoral Matters Inquiry into the NSW Parliamentary Electorates and Elections Amendment (Automatic Enrolment) Bill 2009", (January 2010) at 7, Fig 2.2. Hayne 'proportionality'". The plaintiffs' appeal to the availability of other measures depended upon other, more deep-seated errors than any failure of factual demonstration. In terms, the argument was presented as being at least akin to an argument of proportionality. And it will be recalled that, in the plurality reasons in Roach, it was said263 that "as remarked in Lange264, in this context there is little difference between what is conveyed by that phrase ['reasonably appropriate and adapted'] and the notion of Whether expressed as a test of "proportionality" or as a test of "reasonably appropriate and adapted", the inquiry seeks to measure the impugned provisions against other available means of achieving an identified end. Proper identification of the relevant end is, therefore, not simply important; incorrect identification of the end will determine the result of the proportionality analysis. Identifying the intended "end" as facilitating, encouraging or not preventing any who are eligible to vote from participating in the election begs the question by defining the constitutionally mandated system of government in a manner divorced from constitutional text or structure. It dictates the result of any proportionality analysis. Conclusion The plaintiffs' case was not made good. Application of the impugned provisions does not yield Houses of the Parliament that do not satisfy ss 7 and 24 and are not "directly chosen by the people". The impugned provisions, closing off the rolls by reference to the date of issue of the writs for an election, facilitate the exercise of the franchise. Neither plaintiff (nor others in like case with either) is disenfranchised by application of the impugned provisions. The plaintiffs did not show that the alterations made to the cut-off dates by the 2006 Act were not reasonably appropriate and adapted to the ends of having Electoral Rolls that are fixed for use at a particular election and are suitable for use in distributing States into Electoral Divisions. It was for these reasons that I concluded that the application should be dismissed, with costs. Having regard to what has since been written, one further point should be made. The content of the constitutional expression "directly chosen by the people" neither depends upon, nor is informed by, what are seen from time to time to be the politically accepted or politically acceptable limits to the qualifications that may be made to what is otherwise universal adult suffrage. As 263 (2007) 233 CLR 162 at 199 [85]. 264 (1997) 189 CLR 520 at 567 fn 272. Hayne I explained in Roach265, reference to "common understanding" or "generally accepted Australian standards" does not provide a valid premise for consideration of the issues in this matter. The understanding or standards mentioned have varied, and will likely continue to vary, over time. Their content cannot be reliably determined in a way that permits their use as a criterion of constitutional validity. The ambit of the relevant constitutional powers is not set by the political mood of the time, or by what legislation may have been enacted in exercise of the powers. Political acceptance and political acceptability have no footing in established doctrines of constitutional interpretation. 265 (2007) 233 CLR 162 at 218-220 [157]-[162]. 267 HEYDON J. The reasons for judgment of Hayne J have set out the constitutional and legislative provisions, the background circumstances, and the abbreviations relevant to what follows. The victims of the impugned legislation The plaintiffs said that the impugned provisions created an "exclusion from the constitutional franchise" and "loss of the franchise". They were said to "disenfranchise" the plaintiffs, or "disentitle or exclude [them] from casting a vote". They were said "significantly [to] burden or limit the entitlement of a substantial number of adult citizens to enrol and vote". They were said to be "arbitrary" and "disproportionate". The plaintiffs also referred to a submission of the Human Rights and Equal Opportunity Commission to the Senate Finance and Public Administration Committee in 2006 which made the following claims. One was that the prohibition on accepting new enrolments after the day the writs were issued "has the potential to disadvantage young, first-time voters and new Australian citizens". Another was that a three day period for changing enrolments "disadvantages itinerant populations and people living in remote and rural areas" and "disproportionately" disadvantages "Australia's Indigenous population". Another claim was that these short periods of time "may also disadvantage people with disability who need assistance to access and complete the relevant materials." In addition, the plaintiffs referred to the difficulties young adults face in remaining correctly enrolled due to their residential and workplace mobility. The plaintiffs referred to the disproportionate impact on the homeless. The plaintiffs submitted that "the voting patterns of different age groups can differ substantially", and "a decision as to the time in which rolls will close will have recognised political consequences in relation to enrolments and transfers of the differing age groups, thereby enabling it to be a politically motivated decision." The plaintiffs did not, however, submit that the decisions of the Prime Minister in relation to the calling of the 2010 election fell into this category. The plaintiffs also submitted that "many hundreds of thousands of … young electors … rely on" the existence of a seven day period after the writs are issued for an election "as a way of updating their enrolment". There is no evidence of this reliance. The plaintiffs themselves did not give any evidence to that effect in their affidavits. It is true that many people do not enrol, or transfer their enrolment, until an election is called, but that is a different proposition. The plaintiffs' contentions thus concentrated on the supposed impact of the impugned provisions on Australia's young adults as well as its wretched of the earth – its descamisados and other victims. The plaintiffs never demonstrated that that impact had constitutional relevance, or had any point other than an appeal to pathos. Whether or not the plaintiffs' contentions are correct as a matter of fact, it may be desirable to begin by noting, first, some notorious background facts, and, secondly, the personal position of the plaintiffs. Notorious facts about Australian federal elections There are key background matters of fact which very few Australian citizens, at least those resident in Australia, can be ignorant of. Federal elections take place every two or three years. There is speculation from time to time during the period between elections, and constant speculation towards the end of it, about what date the next election will be held on, what advantages a date will bring to the party to which the Prime Minister of the day belongs, and what problems and disadvantages exist in relation to particular dates. That was certainly the case in relation to the years leading up to the 2010 election. The Prime Minister's announcement on 17 July 2010 of the election date did not come as a surprise. There had been continuous media speculation about the date when her predecessor would call an election. That speculation only intensified once she had succeeded to his office. The submissions advanced by the plaintiffs at times suggested that the realistic possibility of an election being called in the middle to late winter of 2010 did not materialise until the Prime Minister's announcement on 17 July 2010. That is not so. The personal position of each plaintiff What was the effect of the impugned legislation on the plaintiffs personally in relation to the events of this year's election? On Saturday 17 July 2010 the Prime Minister announced that there would be a federal election on Saturday 21 August 2010. Pursuant to ss 12 and 32 of the Constitution, the writs for that election were issued on Monday 19 July 2010. The consequence of the impugned provisions was that claims for new enrolments made after 8pm on Monday 19 July 2010 would not be considered until after the election, and claims for transfers of enrolment made after 8pm on Thursday 22 July 2010 would not be considered until after the election. Had the provisions which preceded the 2006 Act been in force, the electoral roll would have closed for both new enrolments and transfers at 8pm on Monday 26 July 2010. Hence, the first plaintiff, by reason of s 102(4) of the Act, had only one working day to enrol from the time when the Prime Minister announced the election date: she would have had six working days had the provisions in force before the 2006 Act remained in force. And the second plaintiff, by reason of ss 102(4AA) and 155, had only four working days to transfer his enrolment: he too would have had six working days had the provisions in force before the 2006 Act remained in force. But by reason of s 101(1) and (4), the first plaintiff had been under a statutory duty to enrol ever since she turned 18 on 16 June 2010 – more than a month before the rolls closed. It is true that the criminal sanction was small (a fine not exceeding one penalty unit): s 101(6). And it is true that s 101(7) prevented criminal proceedings from being instituted for an offence once the claim to enrolment was made. But the first plaintiff was in breach of statutory duty until then. What is more, she had had more than the five weeks since her eighteenth birthday in which to enrol. She also had had available to her a facility afforded by s 100 of the Act to make a claim to have her name placed on the roll from the time she turned 16. The first plaintiff did not avail herself of that facility. Had she done so, she would have been placed on the roll, and would have been able to vote as soon as she turned 18. The second plaintiff's position was similar. He had not been jammed between a sudden change of address and an unexpected announcement by the Prime Minister. By reason of s 101(1) and (4), the second plaintiff had been under a statutory duty, backed by the s 101(6) criminal sanction as qualified by s 101(7), to transfer his enrolment from the time when he moved to his new address in March 2010 – some four months before the Prime Minister's not unexpected announcement. Before examining the substantive arguments of the plaintiffs, it is convenient to note some difficult aspects of them. Some difficulties in the plaintiffs' arguments An unconvincing distinction between the allegedly invalid and the admittedly valid. The first plaintiff's argument was that the provisions in force before the 2006 Act that gave her five more working days to enrol than the impugned provisions introduced in 2006 were constitutionally valid, but the impugned provisions introduced in 2006 were not. And the second plaintiff's argument was that the provisions in force before the 2006 Act giving him two more working days to transfer his enrolment than the impugned provisions introduced in 2006 were constitutionally valid, but the impugned provisions introduced in 2006 were not. It is not possible to infer from the requirement in ss 7 and 24 of the Constitution that the Houses of Parliament be "chosen by the people" that these temporal differences are of such crucial decisiveness as to mark the difference between validity and invalidity. Differences of this type are in a sense arbitrary, but they are characteristic of the choices which legislatures make, and have to make. It is unlikely that the fundamental norms underlying the Constitution and reflected in its language would require the conclusion that one regime was constitutionally valid while the other was invalid. In part the unsatisfactory distinctions on which the plaintiffs relied stemmed from a reluctance to face up to the logic of their own arguments. That logic pointed at least to the conclusion there should be the widest possible participation in elections – that no person qualified to vote under s 93 should be prevented from voting under s 101 by reason of a failure to make a claim for enrolment or for transfer of enrolment. The arguments assume that all of those entitled to be on the rolls should be entitled to vote. That goal could only be achieved if the time to make claims for enrolment or for transfer of enrolment extended for the maximum amount of time before an election – perhaps right up to the moment when the polling booths closed on the day fixed for the election. An argument that ss 7 and 24 of the Constitution require electors to have the maximum amount of time to enrol before an election is more ambitious, but also more powerful, than an argument that they require a period of only one week after the day when the writs are issued. In the present case the plaintiffs selected the limited arguments they did, perhaps, so as to avoid causing alarm by deploying arguments more consistent with the underlying logic of their position. Those arguments would have had a seemingly audacious character, and perhaps a seemingly flawed nature, which would have reflected badly on the limited arguments they actually chose to advance. And the more consistent but more audacious arguments might have had a potentially annihilating effect on the course of the 2010 election: it is far from clear that the first defendant could have coped with the consequences flowing from their success so as to permit the smooth running of the election. The anomalies which result from the much more limited arguments that were offered raise grave questions about the validity of both the limited and the audacious arguments. Incidentally, so far as the logic of the plaintiffs' arguments calls for the widest possible participation in elections, that logic, arguably, points to even wider conclusions. If the words "chosen by the people" require all of those entitled to be on the rolls to be entitled to vote, why should many members of the population lack entitlement to be on the rolls? Given that an important constitutional provision like s 75(v) can be availed of not merely by Australian citizens but by anyone within the Queen's peace, and given that other sections of the Constitution (for example, ss 80 and 117) do not speak only to citizens, is it valid to exclude from the franchise permanent residents? Or people with long term visas? Or any lawful resident? Or even unlawful residents? Is it valid to exclude persons below the age of 18? Are not all these persons in a sense part of "the Australian people", "the Australian nation", "the Australian community"? If the provisions excluding them from the franchise are valid, the underlying assumptions of the plaintiffs' arguments are questionable. The plaintiffs' arguments do not remedy the problems said to make the impugned provisions invalid. So far as the plaintiffs' arguments about constitutional validity appealed to the particular circumstances of mobile young people, new citizens, itinerant persons, residents of rural and remote areas, Aboriginal persons, persons with disabilities and homeless persons, they did not demonstrate that the difficulties of all or any of these classes would be overcome to any significant degree by extending for five working days the period of enrolment and for two working days the period for transferring enrolment. The plaintiffs' arguments do not remedy wider problems. The plaintiffs contended that the pre-2006 position, giving a seven day period in which to enrol or transfer enrolment, was valid because "it has been shown not to have resulted in such substantial disenfranchisement" that the Parliament had ceased to be a legislature "yielded by the vote of the people". In so far as the plaintiffs' arguments depended on there being "substantial" numbers of voters "excluded" by the impugned provisions, they overlooked the probability that whatever legislative regime were adopted, numbers of voters which are in some sense "substantial" would be "excluded". In 2004, persons who had not enrolled or transferred their enrolment had seven days after the writs were issued to do so: 168,394 people lodged claims for enrolment or transfer after the electoral rolls closed. In 2007, persons who had not enrolled had to do so on the day the writs were issued and persons who had not transferred their enrolment had three more days: 100,370 lodged claims for enrolment or transfer after the electoral rolls closed. It was estimated that 100,000 claims for enrolment were received after the time stipulated under the 2006 amendments but before the time that applied before the 2006 amendments. There was no evidence, however, about the number of claims received outside the time that applied before the 2006 amendments. It would be naïve to suppose that there were no claims of that kind, or that there were not many people qualified to vote who did not enrol. Indeed the plaintiffs frankly conceded that about 1.4 million persons eligible to enrol and to vote are not enrolled – a figure much higher than the numbers supposedly "excluded" by the impugned legislation. Disqualification? The Solicitor-General of the Commonwealth assumed the correctness of the test advocated by the plaintiffs. It had two elements. The first turned on whether the impugned provisions amounted to legislative disqualification from adult suffrage. If so, then according to the second element, the disqualification could only be constitutionally valid if, in the words of three Justices in Roach v Electoral Commissioner, it were for a "substantial" reason, namely one which was "reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government."266 Even if the Solicitor-General was correct in assuming that the second element of this test is applicable to cases of the present kind, this is not a case of disqualification. As the Solicitor-General rightly submitted, the plaintiffs were not in the position of the plaintiff in Roach v Electoral Commissioner. Vicki Lee Roach was completely debarred from voting while she served the term of her 266 (2007) 233 CLR 162 at 199 [85] per Gummow, Kirby and Crennan JJ; [2007] HCA 43. The plaintiffs called this "the standard adopted by the majority", but the fourth member of the Court who upheld Ms Roach's claim, Gleeson CJ, did not adopt that standard, and the other two members of the Court dissented. imprisonment. It was not the case that the law qualified the manner in which she might vote, or the facilities through which she might vote. She was simply not eligible to vote. In contrast, the plaintiffs in this case were fully qualified and entitled respectively to enrol and to transfer enrolment. The impugned provisions stopped them from taking steps to exercise that entitlement over a short period of time – a relatively small fraction of the period in which it was open to the plaintiffs to protect their positions. The plaintiffs were prevented from exercising their entitlement because they failed to comply with simple obligations and procedures in relation to getting enrolled (in the case of the first plaintiff) and transferring enrolment (in the case of the second plaintiff). If the analysis is shifted from the position of the plaintiffs to the position of other persons qualified to enrol or vote, its outcome is as follows. Whether particular voters fall within the classes prevented by the impugned provisions from voting is within their control: they can enrol up to 8pm on the day when the writs are issued, and they can change their enrolment within a further three days. The impugned provisions prevent only three very limited classes of voters who are able, ready and willing to enrol or transfer enrolment from doing so. The first of these very limited classes is voters who have not enrolled because they turn 18 between the issue of the writs and polling day. Their difficulty is curable if they employ the facility available pursuant to s 100 by which persons aged 16 can make a claim to be enrolled. Further, pursuant to ss 100 and 102(4AB) if they turn 18 after the writs are issued and before the election, they can make a claim within the period of three days after the issue of the writs. The second very limited class comprises voters who are to become Australian citizens between the date of the writs and polling day. Their difficulty is curable by the facility available to them to apply for enrolment within a period up to three days after the issue of the writs: ss 99B and 102(4AA). And the third very limited class comprises those who have moved from one Division to another just before the writs are issued and will become entitled, pursuant to s 99(2), to transfer their enrolment after living at a particular address for one month. The plaintiffs did not submit that the existence of this third class rendered the legislation constitutionally invalid, and there is no material before this Court from which it can be concluded that the class is "substantial". Indeed there is nothing to suggest that the memberships of these three classes, whether taken separately or together, and even if the facilities for curing the difficulties of the first two classes are not availed of, are "substantial" in any sense which would satisfy the plaintiffs' test of "substantial disenfranchisement". These three exceptional classes would exist in slightly different forms even under the regime accepted as valid by the plaintiffs, namely the enrolment or transfer of enrolment within seven days after the issue of the writs. The fact that these three exceptional classes exist therefore cannot point to the constitutional invalidity of the impugned provisions while leaving the provisions existing before the 2006 Act valid. All other voters outside the three exceptional classes who fail to enrol or transfer enrolment are the authors of their own misfortunes. They have not taken the steps to enable them to vote which were not only available to them, but required of them by s 101. They are simple steps. It would have been very easy to take them. There was ample time to take them. Despite the prodigious efforts of the first defendant, and the criminal sanctions directed at securing a complete exercise of the franchise, large numbers of people entitled to vote may end up not voting. It was earlier noted that as many as 1.4 million people do not enrol at all, for a variety of reasons. It may be because of their inefficiency. It may be because of their apathy. It may be because they have a positive desire not to participate in the electoral process. One example is the appellant in Judd v McKeon267, which upheld the validity of the provisions making voting compulsory: all the candidates supported capitalism and he belonged to a party which opposed it and prohibited him from voting for supporters of capitalism. Another example is Evelyn Waugh, who said: "I do not aspire to advise my sovereign in her choice of servants."268 It is difficult to treat any of these circumstances as factors relevant to the invalidation on constitutional grounds of an electoral system which works satisfactorily in relation to those who are not inefficient, apathetic, or conscientiously indisposed to participate. If not, why are the much lower numbers excluded by reason of the impugned legislation relevant? Of those who are validly enrolled, some forget that the election is on and do not vote, some turn up too late to vote, some are prevented from voting by a sudden crisis, some are indifferent about voting, some cast informal votes by mistake, and some cast informal votes deliberately. It is notorious that these classes of enrolled non-voters are much more numerous than those excluded by reason of the impugned legislation. None of their members could be described as "disqualified". Nor could those who fail to take steps under s 101 which would enable them to vote. It is they who disqualify, disenfranchise, exclude or disentitle themselves, not the legislature. The conduct of all these categories of people who fail to enrol, or, being enrolled, fail to vote, does not prevent the legislature being described as "chosen by the people". The plaintiffs submitted that the impugned amendments created a "burden" on those who desired to make a claim for enrolment or for transfer of enrolment outside times stipulated – a burden which "does fall disproportionately and is known to fall disproportionately so it is a particular burden on a particular part of the people." The legislation placed no "burden", the 267 (1926) 38 CLR 380; [1926] HCA 33. 268 Gallagher (ed), The Essays, Articles and Reviews of Evelyn Waugh, (1983) at 537. and no "disproportionate" burden. If there were any burden on anyone, it was a burden which those who bore it placed on their own shoulders. Since there has been no "disqualification", it is unnecessary to consider either the formulation or the application of the test which would apply if there had been disqualification. The plaintiffs met the possibility that there was no disqualification by submitting that the Roach test extends beyond disqualification to enactments which do not involve disqualification, but which could be said to "disenfranchise any group of adult citizens or otherwise disentitle or exclude them from casting a vote". The test has verbal similarities with that employed in Lange v Australian Broadcasting Corporation269. That is a test applicable to burdens on freedom of communication about governmental and political matters. It was applied in that case in relation to qualified privilege as a defence to the tort of defamation. Even on the assumption that it operates satisfactorily in that field and in the field of disqualification from voting, it does not follow that it is the correct test in other fields, and the plaintiffs did not demonstrate that it was; indeed they did not even endeavour to do so. "Chosen by the people": the "originalist" argument The nature of "representative government" has changed in Australia in the last century. The franchise has widened in point of gender, race and age. Enrolment was made compulsory in 1911. Proportional voting was introduced for the House of Representatives in 1918. Voting was made compulsory in 1924. Proportional voting was introduced for the Senate in 1948. But it does not follow from the fact that "representative government" has changed that the meaning of the constitutional expression "chosen by the people" has similarly changed. The plaintiffs, and not only the plaintiffs, advanced submissions turning on the relationship between the forms of electoral law from time to time over the last 110 years and the meaning of the Constitution. It was submitted on behalf of the Attorney-General for Western Australia that the "common contemporary understanding of a concept invoked by the Constitution" – that is, that understanding from time to time in the last century – influences "the meaning of a constitutional term", namely, "chosen by the people". These submissions generated a congenial atmosphere. But that atmosphere was disturbed by the Solicitor-General of the Commonwealth. Stimulating as much approbation as the man who asked for a double whisky in the Grand Pump Room at Bath, he asked an "originalist" question and propounded an "originalist" answer. The question was whether, in the light of the meaning of the words "chosen by the people" in 269 (1997) 189 CLR 520 at 567; [1997] HCA 25. 1900, precluding persons not on the electoral roll after the issue of the writs from voting in the election produced a legislature not "chosen by the people". The answer was in the negative, because a system of that kind fell within the meaning of those words in 1900. That answer is correct because the first federal election, in the absence of contrary provision by the Parliament, was conducted pursuant to the State laws relating to the more numerous House of Parliament of each State: see ss 8, 10, 30 and 31 of the Constitution. The researches of the Solicitor-General of the Commonwealth and counsel appearing for the Attorney-General for Western Australia have revealed that all those State laws made the right to vote in an election conditional on being enrolled on the relevant electoral roll270. In each State there were provisions that closed off the electoral roll to new enrolments or transferred enrolments at some point before polling day, although the precise date on which the rolls became closed varied significantly from State to State. In New South Wales the general electoral roll was revised annually. The Revision Court sat in October and the roll was to be finalised in December. The Revision Court also sat in March to produce a supplementary roll in May of each year. Each roll remained in force until the coming into force of the next general roll271. Transfer of an elector's right to vote from one district to another was accomplished by placing the elector's name on an additional roll without recourse to the Revision Court272, but no entry could be made in the interval between the issue of the writ and the declaration of the poll273. In Queensland an annual electoral roll was completed each December and it was supplemented by quarterly electoral rolls274. Each roll while in force was (subject to specific exclusions) conclusive evidence of the entitlement of persons named in it to vote275. 270 Parliamentary Electorates and Elections Act 1893 (NSW), s 80; Elections Act 1885 (Q), s 40; Electoral Code 1896 (SA), ss 36, 116 and 126; Electoral Act 1896 (Tas), s 57; Constitution Act Amendment Act 1890 (Vic), s 241; Electoral Act 1899 (WA), ss 21, 87 and 104. 271 Parliamentary Electorates and Elections Act 1893 (NSW), ss 47-51. 272 Parliamentary Electorates and Elections Act Amendment Act 1896 (NSW), ss 2, 3 and 4. 273 Parliamentary Electorates and Elections Act Amendment Act 1896 (NSW), s 4(II). 274 Elections Act 1885 (Q), ss 9-37. 275 Elections Act 1885 (Q), s 40. In South Australia new rolls were to be prepared every tenth year276 with supplemental rolls printed annually277 as well as "immediately previous to a general election"278. Claims for enrolment were receivable at any time and were to be acted upon immediately279, but the rolls were not to be altered on polling day or during the four days preceding an election280. Applications for transfer were receivable at any time except on polling day or in the 10 days leading up to the election281. However, a person was not entitled to vote unless that person had been registered for six months as an elector282. In Tasmania claims for enrolment were to be made in November of each year283, with an annual revision of the rolls to be completed in April284. The roll for each Division as revised was to be used in any election taking place until the following April285. In Victoria separate processes existed for the two Houses of Parliament. For the Legislative Council, a general electoral roll was prepared annually by a process ending in February, with a supplementary roll completed each August286. For the Legislative Assembly, a general roll was prepared annually by a process ending in April, with a supplementary roll in September287. For both Houses, each roll continued in force until the completion of the next annual roll288. 276 Electoral Code 1896 (SA), s 41. 277 Electoral Code 1896 (SA), ss 43 and 60. 278 Electoral Code 1896 (SA), s 43. 279 Electoral Code 1896 (SA), ss 47-49. 280 Electoral Code 1896 (SA), s 57. 281 Electoral Code 1896 (SA), ss 51-52. 282 Electoral Code 1896 (SA), ss 14-15. 283 Electoral Act 1896 (Tas), ss 22-25. 284 Electoral Act 1896 (Tas), s 56. 285 Electoral Act 1896 (Tas), s 57. 286 Constitution Act Amendment Act 1890 (Vic), ss 77-96. 287 Constitution Act Amendment Act 1890 (Vic), ss 168-185. 288 Constitution Act Amendment Act 1890 (Vic), ss 97 and 186. In Western Australia new rolls were to be prepared in connection with each census289 with supplemental rolls printed annually290 as well as "immediately previous to a general election"291. Claims for enrolment were receivable at any time and were to be acted upon immediately292, but the rolls were not to be altered on polling day or during the four days preceding an election293. Applications for transfer could not be made between the issue of a writ for an election and polling day294. A person was not entitled to vote in an election unless that person had been registered for six months as an elector295. Some of the States having provisions preventing persons from voting unless enrolled, and not permitting enrolment after the issue of the writs, had property qualifications which were either necessary or sufficient conditions for voting. The States in question were Queensland296, Tasmania297 and Western Australia298. Some of these property qualifications were complex, and checking them in the period between the issue of the writs and polling day might have been difficult. But, as the Solicitor-General of the Commonwealth correctly submitted, this cannot explain why in those States it was not possible to alter the rolls after the issue of the writs. It follows that the contemporary understanding of the words "chosen by the people" in 1900 was consistent with the exclusion of those not on the roll when the writs were issued from voting. 289 Electoral Act 1899 (WA), s 26. 290 Electoral Act 1899 (WA), s 28. 291 Electoral Act 1899 (WA), s 28. 292 Electoral Act 1899 (WA), ss 33-34. 293 Electoral Act 1899 (WA), s 44. 294 Electoral Act 1899 (WA), s 37. 295 Constitution Acts Amendment Act 1899 (WA), s 15. 296 Elections Act 1885 (Q), s 6. 297 Constitution Amendment Act (No 2) 1896 (Tas), ss 3-5. 298 Constitution Acts Amendment Act 1899 (WA), s 15. the Those who object the Commonwealth commonly contend type of reasoning employed by that the Solicitor-General of the understanding in 1900 of appropriate electoral laws is irrelevant in that those laws were different from, and less enlightened than, our own. In those days in elections to some legislatures there were property qualifications, restrictions on Aboriginal suffrage and restrictions on female suffrage. The question, however, is not what the most enlightened possible meaning, judged by modern standards, might be borne by the words "chosen by the people". The question is what meaning skilled lawyers and other informed observers considered those words to bear in the 1890s299, and, being words used to describe processes which were evolving and subject to "dynamism"300, what meanings those observers would reasonably have considered they might bear in future301. Even though the federation age knew of property qualifications, restrictions on Aboriginal suffrage and restrictions on female suffrage, it also knew of universal manhood suffrage, Aboriginal suffrage and female suffrage, and knew of those things in the practical sense that in some parts of Australia they existed without relevant restriction. The failure of the federation age to offer universally applicable systems of suffrage conforming entirely to the most advanced modern models is not a reason to ignore what the meanings and applications of the words "chosen by the people" in the federation age were. As counsel for the Attorney-General for Western Australia correctly submitted, a person in the position of the first plaintiff, who wished to become enrolled after the issue of the writs for an election, could not have done so in the first federal election in any State. And a person in the position of the second plaintiff, who wished to transfer his enrolment after the issue of the writs, could only have done so in South Australia, and even then only in certain circumstances. Assuming that the Constitution now means what it meant then, on the plaintiffs' case, had there been a challenge to the validity of the electoral laws under which the first election was conducted, the challenge would, paradoxically, have succeeded, but for their explicit adoption by ss 10 and 31 of the Constitution. That points against the words "chosen by the people" bearing the construction for which the plaintiffs contend. 299 Cole v Whitfield (1988) 165 CLR 360 at 385; [1988] HCA 18. 300 Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 496 [23] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [2000] HCA 14. 301 XYZ v The Commonwealth (2006) 227 CLR 532 at 583-584 [153]; [2006] HCA 25. The validity of the electoral laws under which elections between 1902 and 1983 were conducted Further, and still assuming that the Constitution now means what it meant then, had there been challenges at the appropriate times, on the plaintiffs' case, every other election up to and including the 1983 election would have been conducted under invalid electoral laws. 1902-1918. Between 1902 and 1918 there were six elections. They were regulated by the Commonwealth Electoral Act 1902 (Cth). Section 31 relevantly provided: "All persons qualified to vote at any Election for the Senate or House of Representatives, or who would be qualified so to vote if their names were upon a Roll, shall be qualified and entitled to have their names placed upon the Electoral Roll for the Division in which they live, but no person shall be qualified or entitled to have his name placed upon more than one Roll, or upon any Roll other than the Roll for the Division in which he lives." Section 64 provided: "Claims and applications to transfer received by the Returning Officer or Registrar before the issue of the writ may be registered after the issue of the writ but otherwise no addition to or alteration of the Roll for any Division shall be made during the period between the issue of the writ for an election in the Division and the close of the polling at the election." Hence persons in the position of the plaintiffs could not have been enrolled, because they had not lodged the relevant claim or application before the issue of the writ. That state of affairs continued even after s 64(2) was added by s 12 of the Commonwealth Electoral Act 1909 (Cth): it deemed the writs to be issued at 6pm on the day on which they were issued. 1918-1983. Between 1918 and 1983 there were 26 elections. The position was governed by s 45 of the Act in its then form. Relevantly it provided: claims for enrolment or transfer of enrolment which are received by the Registrar after six o'clock in the afternoon of the day of the issue of the writ for an election shall not be registered until after the close of the polling at the election; and except by direction of the Divisional Returning Officer no name shall be removed from a Roll pursuant to a notification of transfer of enrolment received by the Registrar after six o'clock in the afternoon of the day of the issue of the writ for an election and before the close of the polling at the election." Again, in this period the plaintiffs would have been in the same position as under the 2006 amendments, save that the 2006 amendments were a little more liberal in four respects. First, s 102(4) allowed an additional two hours in which claims for enrolment could be lodged (8pm on the day of the writs, not 6pm). Secondly, s 102(4AA) read with s 155 allowed an additional three working days for claims for transfer of enrolment. Thirdly, late claims could be made by persons who turned 18 after the writs were issued under s 100. Fourthly, late claims could be made by persons becoming Australian citizens after the writs were issued by making a provisional claim for enrolment under s 99B. Between 1902 and 1983 the legislation required the electoral rolls to close on the day the writs were issued. The burden of which the plaintiffs complain would not exist in relation to elections in which the executive exercised a discretion to permit more than seven days to elapse between the calling of the election and the issue of the writs. But that cannot render electoral laws valid which would otherwise have been invalid. Legislation which is invalid if administered in one way cannot be treated as valid if it could be administered in another. The Solicitor-General of the Commonwealth was correct to submit that if the submissions of the plaintiffs were sound, all federal elections conducted up to and including 1983 have been conducted under invalid electoral laws, and that this conclusion is so highly improbable as to cast considerable doubt on the submissions of the plaintiffs which led to it. Far from being beside the point, the Solicitor-General's submission is, particularly in relation to elections conducted in the federation age, forceful. The plaintiffs parried the Solicitor-General's submission by contending that there are some developments in electoral law which the Constitution now prevents the legislature from reversing. They said that the Constitution renders it impossible now to return to an earlier stage of development, even though that stage of development would have been constitutionally valid at an earlier time. The only specific examples the plaintiffs gave were universal adult suffrage and the capacity to vote at 18. Even if those examples are correct, it does not follow that the much more general proposition of which they were said to be illustrations is correct302. And even if that much more general proposition is correct, it does not follow that the return made in the 2006 amendments to the position obtaining from 1902 to 1983 is constitutionally invalid. The plaintiffs relied on the emergence of "different circumstances (including changing 302 Roach v Electoral Commissioner (2007) 233 CLR 162 at 224 [179]. technology enabling continuous roll updating … and the processing and checking of large numbers of claims for enrolment very rapidly)". The proposition which the plaintiffs advocate does not follow from these circumstances. The proposition which the plaintiffs advocate also leads to the result that even where an election is conducted under legislative provisions which result in members of Parliament being "directly chosen by the people" – the constitutional criterion – those provisions may nonetheless be constitutionally invalid because they retreated from the position achieved by earlier legislation (or executive practice). A conclusion which rests on an asseveration that legislation meeting a constitutional criterion is constitutionally invalid is a contradiction in terms. It is a contradiction which casts in doubt the whole of the reasoning which led to it. The constitutional validity of legislation depends on compliance with the Constitution, not on compliance with "higher" standards established by the course of legislation and by the operation of executive discretion. The question is not whether an impugned legislative provision "regresses" from some "higher" standard established by the status quo. It is only whether it fails to meet a constitutional criterion. Legislative development, durable or otherwise, does not create constitutional validity or invalidity which would not otherwise exist. Otherwise the legislature could enact itself into validity. Illegality and constitutional validity Under the legislative scheme, an effective franchise system depends on an accurate electoral roll. Entitlement to vote depends on being on the roll. The legislation also seeks to ensure an approximate equality of voters in each Electoral Division. The Electoral Commissioner is obliged each month to ascertain the number of electors enrolled in each Division, determine the average divisional enrolment, determine the extent to which the number of electors enrolled in each Division differs from the average divisional enrolment, and publish a statement of the results in the Gazette: s 58(1). Sections 59-78 make provision for redistribution, where, inter alia, more than one third of the Divisions in a State are "malapportioned Divisions". These provisions depend for their effectiveness on those entitled to be enrolled becoming enrolled. They also depend for their effectiveness on persons enrolled making timely statements about a change of residence. The obligations to enrol and transfer enrolment imposed by s 101 are directed at achieving that state of affairs. The right of enrolled electors to vote could not operate optimally without citizens complying with the duties to enrol and to transfer enrolment. To ensure the accuracy of the rolls, the Electoral Commissioner has the power to reject claims to enrol or transfer enrolments which are not in order: s 102(1)(c). There are also provisions pursuant to which electors may object to the enrolment of others: Pt IX. The scheme contains an elaborate procedure for the conduct of an election after the writs have been issued which assumes that the electoral rolls are in very large measure correct. The scheme also gives the electoral rolls immunity from challenge in the Court of Disputed Returns after the election is over: s 361(1). A key element in the legislative scheme to secure largely correct electoral rolls is the use of compulsion. There is a statutory command to claim or transfer enrolment. That command is backed by a criminal sanction. The plaintiffs did not dispute the constitutional validity of either the command or the sanction. What they demand is an entitlement to continue disobeying the command and ignoring the sanction for longer periods than the impugned provisions allow. The plaintiffs say that the impugned provisions are void because they fix periods which cause a "substantial" number of persons to be disenfranchised. On the plaintiffs' arguments, the disenfranchisement only arises because a "substantial" number of people choose to disobey laws compelling them to claim or transfer enrolment, laws which the plaintiffs concede are valid. The plaintiffs' arguments could not work if it were only they who had disobeyed the laws, because two is not a sufficiently substantial number. The laws alleged to be invalid and the laws conceded to be valid are, however, part of a single integrated scheme. The constitutional validity of some laws in that scheme cannot turn on the number of people who choose to disobey other concededly valid laws enacted as part of that scheme. The validity of the impugned provisions cannot wane or wax as the number of persons who fail to comply with their statutory duties rises or falls. Substantial disobedience to laws validly enacted under a power to do so in the Constitution (in this instance s 51(xxxvi)) cannot render invalid other laws enacted under that power. So to hold would subvert not only the validly enacted laws, but also the Constitution under which they were validly enacted. Conclusion For the above reasons I opposed the orders made by the Court on 6 August 2010, and would have dismissed the proceedings with costs. Crennan CRENNAN J. In this proceeding the plaintiffs put in issue the constitutionality of amendments made to the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act") by the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth) ("the 2006 Act"). The legislative history, and a description both of the current electoral structure and of the calling of the general election for 21 August 2010, are all set out in the joint judgment of As adult Australian citizens303, able to satisfy a one month residency requirement304, each plaintiff is entitled to be on an Electoral Roll under the Electoral Act305. Ms Rowe, having turned 18 on 16 June 2010, is obliged to enrol, and Mr Thompson, having changed his address in March 2010, is obliged to transfer his enrolment306. If enrolled, each plaintiff is entitled to vote at elections of senators for the State in which each resides307 and at elections of members of the House of Representatives for the Subdivision in which each resides308. Each of the plaintiffs wished to vote at the election held on 21 August 2010 and for that purpose each sought to be enrolled on the relevant Electoral Roll within seven days after the issue of the writs. This would have been possible under the Electoral Act as it stood before the 2006 Act. However, the plaintiffs' claims were not considered because of the provisions of ss 102(4), 102(4AA) and 155 of the Electoral Act, being amendments made by the 2006 Act, expressed to repeal ss 102(4) and 155 as they previously stood. Under s 102(4), the time during which a claim for enrolment must not be considered begins at 8:00 pm on the date of the writ or writs for an election for the relevant Division and ends at the close of the polling at the election. Under s 102(4AA) the time during which a claim for transfer of enrolment must not be considered begins at 8:00 pm on the date of the close of the Rolls (fixed by s 155(1) as the third working day after the date of the relevant writ) and ends at the close of the polling at the election. 303 Electoral Act, s 93(1)(a) and (b)(i). 304 Electoral Act, s 99(1). 305 Part VI (ss 81-92). 306 Section 101(1). 307 Respectively South Australia and New South Wales. 308 See ss 82 and 93(2). Crennan The plaintiffs impugned ss 102(4), 102(4AA) and 155 of the Electoral Act, asserting in their written submissions that they are: (a) contrary to ss 7 and 24 of the Constitution; (b) beyond the legislative powers of the Commonwealth conferred by ss 51(xxxvi) and 30 of the Constitution; and/or (c) beyond what is reasonably appropriate and adapted, or proportionate, to the maintenance of the constitutionally prescribed system of representative government. During the course of oral argument the plaintiffs concentrated on ss 7 and 24 and the prescription therein for Houses of Parliament composed of members "directly chosen by the people". Their submissions did not turn on the word "directly". The impugned provisions were characterised as "disenfranchising" the plaintiffs because, although the plaintiffs were legally eligible to vote in the election in the State and Subdivision in which they reside, the provisions prevented them from doing so. Accordingly, it was contended that the impugned provisions are not reasonably adapted and appropriate to support choice by the people in elections for the Senate and the House of Representatives and that the provisions interfere, unreasonably and unnecessarily, with the opportunity to enrol and vote. The plaintiffs accepted that Parliament was entitled to prescribe a cut-off date for enrolment and transfer, and they did not attack the validity of ss 102(4) and 155 as they stood previously. Evidence from the Deputy Electoral Commissioner indicated that there were approximately 100,000 claims for enrolment received after the cut-off dates described above which would have been made within time under ss 102(4) and 155 as they stood prior to the 2006 Act309. Evidence that those claims could be processed onto an Electoral Roll within the statutory timetable set for the election was not controverted. A declaration of invalidity was made by the Court, by majority, on 6 August 2010, the effect of which is to repeal the impugned provisions and thereby restore the operation of the Electoral Act as it previously stood310. For the following reasons I joined in the making of those orders. When referring to the influence of the introduction of responsible government and its development, in The Commonwealth v Kreglinger & Fernau Ltd and Bardsley311, Isaacs J asserted the relevance "in interpreting the Australian 309 Section 155 as it stood before repeal under the 2006 Act provided that the date fixed for the close of the Rolls shall be seven days after the issue of the relevant writ. 310 Roach v Electoral Commissioner (2007) 233 CLR 162 at 182 [25] per Gleeson CJ, 202-203 [96]-[97] per Gummow, Kirby and Crennan JJ; [2007] HCA 43. 311 (1926) 37 CLR 393 at 411-412; [1926] HCA 8. Crennan Constitution, of every fundamental constitutional doctrine existing and fully recognized at the time the Constitution was passed". In Attorney-General (Cth); Ex rel McKinlay v The Commonwealth312 the text of the Constitution was construed having regard to the historical setting in which the Constitution was created, which included considering the colonial suffrages in Australia in 1900313. In establishing the Commonwealth, the Constitution directs, and gives to, a system of representative government314 (sometimes called effect representative democracy315) which involves direct popular election316. The Constitution left it to Parliament, within the limits fixed by the Constitution, to prescribe the form of representative government317. The matters of qualification for the franchise and the method of election for both the Senate and the House of Representatives are left by the Constitution to the political choice of Parliament, so long as any electoral system adopted remains within the broad range of alternatives by which provision may be made for Houses of Parliament composed of members "directly chosen by the people"318. 312 (1975) 135 CLR 1; [1975] HCA 53. 313 (1975) 135 CLR 1 at 17, 19 per Barwick CJ, 58 per Stephen J. 314 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 137-138 per Mason CJ, 150 per Brennan J, 168 per Deane and Toohey JJ, 184, 188 per Dawson J, 210-211 per Gaudron J, 230 per McHugh J; [1992] HCA 45. in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 56-58. 316 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 56 per Stephen J; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 236 [153] per Gummow and Hayne JJ; [2004] HCA 41. 317 Roach v Electoral Commissioner (2007) 233 CLR 162 at 173 [5] per Gleeson CJ, 186-187 [45] per Gummow, Kirby and Crennan JJ. 318 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 36 per McTiernan and Jacobs J, 46 per Gibbs J, 56-57 per Stephen J; McGinty v Western Australia (1996) 186 CLR 140 at 182-184 per Dawson J, 269-270, 283-284 per Gummow J; [1996] HCA 48; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 188-189 [6]-[7], [9] per Gleeson CJ, 206-207 [61]-[65] per McHugh J, 237 [154]-[155] per Gummow and Hayne JJ, 257 [223] per Kirby J, 296 [332] per Callinan J. Crennan In Roach v Electoral Commissioner319 Gleeson CJ said: "In McKinlay320, McTiernan and Jacobs JJ said that 'the long established universal adult suffrage may now be recognised as a fact'. I take 'fact' to refer to an historical development of constitutional significance of the same kind as the developments considered in Sue v Hill[321]. Just as the concept of a foreign power is one that is to be applied to different circumstances at different times, McTiernan and Jacobs JJ said that the words 'chosen by the people of the Commonwealth' were to be applied to different circumstances at different times. Questions of degree may be involved. They concluded that universal adult suffrage was a long established fact, and that anything less could not now be described as a choice by the people. I respectfully agree. As Gummow J said in McGinty v Western Australia322, we have reached a stage in the evolution of representative government which produces that consequence. I see no reason to deny that, in this respect, and to this extent, the words of ss 7 and 24, because of changed historical circumstances including legislative history, have come to be a constitutional protection of the right to vote." The other members of the majority in Roach323 said of representative government: "In McGinty324 the Court held that what is involved here is a category of indeterminate reference, where the scope for judgment may include matters of legislative and political choice. But that does not deny the existence of a constitutional bedrock when what is at stake is legislative disqualification of some citizens from exercise of the franchise." The historical circumstances, and the stage reached in the evolution of representative government, as at the date of federation assist in exposing the bedrock and show that the relevant words of ss 7 and 24 have always constrained 319 (2007) 233 CLR 162 at 174 [7]. 320 (1975) 135 CLR 1 at 36. 321 (1999) 199 CLR 462; [1999] HCA 30. 322 (1996) 186 CLR 140 at 286-287. 323 (2007) 233 CLR 162 at 198 [82] per Gummow, Kirby and Crennan JJ. 324 (1996) 186 CLR 140 at 269-270. Crennan Parliament, in a manner congruent with Gleeson CJ's conclusion that the words of ss 7 and 24 have come to be a constitutional protection of the right to vote. Representative government is a government in which members of Parliament represent those who have voted for them in an election325. A franchise which is exclusive and undemocratic yields an oligarchic representative government326. Edmund Burke described this form of government as amounting to "virtual representation" of the people, even though the representatives "are not actually chosen by [the people]"327. The expression "chosen … by the People" occurs in Art I, §2 of the American Constitution, but it has its own distinctive history in Australia328 grounded in British constitutional history and colonial politics in the second half of the nineteenth century. In constitutional discourse over a long period, choice by the people of parliamentary representatives has signified democracy, democratic elections and a democratic franchise. The defining constitutional debate in Britain in the nineteenth century was over whether (and, if so, how) there should be a change from an oligarchic representative government to a democratic representative government. In that debate, manhood suffrage (that is, a right to vote which was not dependent on considerations of rank or class) was considered crucial to effect the change from oligarchy, "[g]overnment by the few"329, to democracy, "[g]overnment by the people"330. As a result, franchises based on residential qualifications, rather than property qualifications, came to be seen as quintessentially democratic, an important point when considering the stage in the development of representative government which had been reached in the colonies prior to federation. 325 Ashby v White (1703) 2 Ld Raym 938 [92 ER 126]. 326 John Stuart Mill, Considerations on Representative Government, 2nd ed (1861), Ch IV at 81, 83. 327 Letter to Sir Hector Langrishe, 1797, quoted in Birch, Representative and Responsible Government, (1964) at 24. 328 Cf Wesberry v Sanders 376 US 1 (1964); see also Baker v Carr 369 US 186 329 A New English Dictionary (which became the Oxford English Dictionary), (1905), vol VII, Pt I at 103. 330 A New English Dictionary (which became the Oxford English Dictionary), (1897), vol III, Pt I at 183. Crennan The Constitution emerged after debate in Britain over extending parliamentary representation by widening the franchise, in the direction of democratic representative government. Whilst framers of the Constitution "admired and respected British institutions"331, an aspect of those institutions already contested successfully in some of the Australian colonies in the middle of the nineteenth century was the franchise based on property qualifications332. Britain – "chosen by the people" The centrality of the franchise to sharing political power had caused arguments over extending parliamentary representation stretching right back to the Putney Army debates held in the period 1647 to 1649. Sustained debates over a version of manhood suffrage333 were then generated by the "Heads of the Proposals"334 and two "Agreements of the People" drawn up chiefly by the Levellers, who supported a republican democracy. Whilst the proposals for manhood suffrage were defeated, the identification of manhood suffrage as a democratic franchise by which "the people do … choose themselves a Parliament"335 distinguished it from the extant exclusive franchise based on property qualifications. 331 Roach v Electoral Commissioner (2007) 233 CLR 162 at 172 [1] per Gleeson CJ. 332 As to which see Cannon (ed), The Oxford Companion to British History, rev ed "an Act of Henry VI's reign in 1429 declared that 'great, outrageous and excessive numbers of people … of small substance and of no value' were voting at elections, and went on to limit the franchise to freeholders with land worth 40 shillings a year, free of all charges. This remained the franchise until 1832." 333 See Woodhouse (ed), Puritanism and Liberty: Being the Army Debates (1647-9) from the Clarke Manuscripts, (1938) ("Puritanism and Liberty") at 52-75, 77-83, 343, 356-363, 406-407, 433-434, 438, 445-446, 450, 454 and 462-463. See also Tuck, Philosophy and Government 1572–1651, (1993) at 245-252. 334 The "Heads of the Proposals", to be found in Puritanism and Liberty at 422, referred to "some other rule of equality or proportion, to render the House of Commons (as near as may be) an equal representative of the whole". 335 Article III of the first "Agreement of the People" (28 October 1647) proposed "[t]hat the people do, of course, choose themselves a Parliament": Gardiner, The Constitutional Documents of the Puritan Revolution 1625–1660, 3rd ed (1906) at 333-335. Article III of the second "Agreement of the People" (15 January 1649) proposed, among other matters, manhood suffrage with the exception of persons receiving alms, servants and Royalists: Gardiner at 359-371. Crennan Whilst debates over sharing political power by extending the franchise never disappeared completely in Britain, they were back on the political agenda during a significant part of the nineteenth century. The Reform Acts of 1832336, 1867337 and 1884338 provided for ever greater inclusion of electors in the franchise. The third Reform Act, which extended household suffrage, has been referred to as going "almost all the way to universal male suffrage"339. The Chartist movement emerged in 1838, after the first Reform Act340. The "People's Charter", directed to the House of Commons, had six points concerning the sharing of political power. The first, mentioned by Barwick CJ in King v Jones341, was "[a] vote for every man twenty one years of age, of sound mind, and not undergoing punishment for crime" (often referred to as universal manhood suffrage342). The second was the ballot "[t]o protect the elector in the exercise of his vote", that is, a secret ballot, which was first instituted in Victoria in 1856343. Regular and short parliaments were also advocated344. 336 Representation of the People Act 1832 (2 & 3 Will IV c 45). 337 Representation of the People Act 1867 (30 & 31 Vict c 102). 338 Representation of the People Act 1884 (48 & 49 Vict c 3). 339 Butler, The Electoral System in Britain Since 1918, 2nd ed (1963) at 5. 340 The Act widened the British electorate but it did not change its social, occupational or property-based character. However, the principle was conceded that it was the individual citizen who should be represented in Parliament. 341 (1972) 128 CLR 221 at 234; [1972] HCA 44. 342 Jeremy Bentham proposed a form of universal manhood suffrage to effect, together with other proposals, what he regarded as the right and proper end of government, namely "the greatest happiness of the greatest number, the only legitimate end of government": Bentham, "Supreme Operative", (1822), §16, in Schofield (ed), The Collected Works of Jeremy Bentham: Constitutional Code, (1989) 149 at 197-198. First Principles Preparatory 343 Electoral Act 1856 (Vic) (19 Vict No 12), s 36. 344 The other points of the Charter were that electorates should contain the same number of votes to ensure votes were of equal value, there should be no property qualification for members of parliament and members should be paid: the six points of the People's Charter are set out in Hanham, The Nineteenth Century Constitution 1815–1914: Documents and Commentary, (1969) at 270. Crennan The Australian colonies – "chosen by the people" In that historical setting, colonial franchises were developed in Australia, in the 1850s, for newly instituted bicameral legislatures, as New South Wales, Victoria and South Australia framed their own Constitutions after the passage of the Australian Constitutions Act 1850 (Imp), which granted self-government345. The first of the colonies to provide residential qualifications for voters (that is, manhood suffrage) in respect of elections for the Legislative Assembly was South Australia, with the Constitution Act (SA)346 passed in 1856. In Victoria, the second colony to introduce manhood suffrage, the discovery of major deposits of gold at Ballarat occurred shortly after the separation from New South Wales347. The Bill for the new Constitution for Victoria was laid on the table for debate by the colonial legislature in January 1854. It was noted by Colonial Secretary Foster in the prefatory report of the Select Committee on the New Constitution that "nothing could be more impolitic than to legislate against the spirit of the age" and that "the social condition of this colony renders a close assimilation to certain British institutions impossible and that an attempt to imitate them is likely, not only to fail, but to introduce the evils without the advantages experienced from them in England"348. A campaign had already begun for the enfranchisement of the diggers on the goldfields whose "property" was a tent or hut. A diggers' association called the Ballarat Reform League had a programme which was "substantially that of English Chartism adapted to local circumstances"349. 345 13 & 14 Vict c 59. See generally Lumb, The Constitutions of the Australian States, 5th ed (1991). 346 Act No 2 of 1855-6. 347 The separation of Victoria from New South Wales took effect, pursuant to the Australian Constitutions Act 1850, on 1 July 1851: Victorian Government Gazette, 9 July 1851 at 77-78. The first findings at Ballarat occurred "during the first days of September [1851]": Davison, The Discovery and Geognosy of Gold Deposits in Australia, (1860) at 120. 348 Argus, 4 January 1854. 349 Scott, A Short History of Australia, 4th ed reissue (1925) at 213. The programme included "parliamentary representation on the basis of manhood suffrage, the (Footnote continues on next page) Crennan Diggers urged that "it is the inalienable right of every citizen to have a voice in making the laws he is called upon to obey. That taxation without representation is tyranny."350 In a list of grievances they referred to "the strong conviction in the minds of the diggers that they never will have justice until they are fully and fairly represented in the Legislative Council" and urged the "giving [of] full and fair representation to the people"351. This was the language of British radicalism supporting a democratic franchise, and it echoed John Locke's insistence on the rights of the individual and the idea that good and just government should command the consent of the people352. Public discourse reflected the same themes. The campaign for digger franchise eventually succeeded in 1855, the year following the Eureka Stockade353, with the franchise following a £1 miner's payment of members of Parliament [and] the abolition of the property qualification for members of Parliament". 350 Enclosure No 2 from Sir Charles Hotham, Lieutenant-Governor of Victoria to Sir George Grey, the Colonial Secretary, in Clark (ed), Select Documents in Australian History 1851–1900, (1955) at 58. "Unfair taxation without representation" was given as one of the American colonists' reasons for the Revolutionary War, which commenced in April 1775. Thomas Paine emphasised the imbalance between taxation and the right to vote in The Rights of Man, (1791), Pt I; (1792), Pt II. The theme of "no taxation without representation" was picked up again in the early part of the nineteenth century in William Cobbett's Political Register. It was repeated by the Chartists as a way of characterising their demands as "constitutional". The expression found its way into public colonial debates on the franchise in both New South Wales and Victoria. 351 See the letter from the Ballarat Reform League to the Board of Enquiry, set out in Victoria, Riot at Ballaarat: Report of the Board Appointed to Enquire into Circumstances Connected with the Late Disturbance at Ballaarat together with the Evidence Taken by the Board, (1854), Appendix B at 20. 352 Locke said: "whenever the legislators endeavour to take away and destroy the property of the people, or to reduce them to slavery under arbitrary power, they put themselves into a state of war with the people, who are thereupon absolved from any farther obedience": Locke, The Second Treatise of Government, Gough ed (rev) (1956), Ch XIX, "Of the Dissolution of Government", §222 at 110. 353 At which both diggers and troops were killed: see Molony, Eureka, (2001) at Crennan right354. The Victoria Constitution Act 1855 (Imp)355 received the Royal Assent on 16 July 1855 and came into operation a short time thereafter, and manhood suffrage for the Legislative Assembly inevitably followed digger suffrage in 1857356. Throughout the campaign for a wide suffrage based on residential qualifications, "choice by the people" of parliamentary representatives signified democracy, which required democratic election of parliamentary representatives, which in turn required a democratic franchise. In New South Wales, the third colony to introduce manhood suffrage, there had been a public campaign, centred in Sydney, by a distinct group of self-styled democrats for some years before the passage of the New South Wales Constitution Act 1855 (Imp)357; a group, known as the Constitutional Association, in which Mr (later Sir) Henry Parkes was active, had its own newspaper, The People's Advocate and New South Wales Vindicator358. Whilst events differed markedly from those in Victoria, the same imbrication of radical ideas was advanced in support of manhood suffrage for the lower House of Parliament. Manhood suffrage and the secret ballot were introduced for the Legislative Assembly in New South Wales with the passage of the Electoral Act 1858 (NSW)359 on 24 November 1858. The conception of democracy appealed to during campaigns in the 1850s for the right to vote transcended questions of qualifications for the franchise. Democracy was seen as an active and continuing process in which all legally eligible citizens had an equal share in the political life of the community, so as to secure legislatures which were both just and representative, and which enured to the peace and good order of the polity360. To that consideration might be added 354 Victoria Constitution Act 1855 (Imp) (18 & 19 Vict c 55), Sched 1, s 5 and Gold Fields Act 1855 (Vic) (18 Vict No 37), ss 2 and 3. 355 18 & 19 Vict c 55. 356 See Abolition of Property Qualification Act 1857 (Vic) (21 Vict No 12). 357 18 & 19 Vict c 54. 358 See Cochrane, Colonial Ambition: Foundations of Australian Democracy, (2006) at 197-198; and Hirst, The Strange Birth of Colonial Democracy: New South Wales 1848–1884, (1988) at 3. 359 22 Vict No 20. 360 This conception of democracy was subsequently explicated by John Stuart Mill in his essay Considerations on Representative Government, 2nd ed (1861), Ch III. For a contemporary account of a similar conception of democracy see Sen, The Idea of Justice, (2009), Chs 15, 16. Crennan that, in its relations with other nations, a democratic nation is characterised as one in which political equality and liberty are secured, however variously, by different electoral systems. The centrality of the franchise, to a citizen's participation in the life of the community and membership of the Australian body politic, was recognised in Roach361. Whilst manhood suffrage for lower Houses of Parliament was achieved in the 1850s with relative ease in the colonies mentioned362, an immediate reaction, to halt the tide of democracy, was to institute plural voting on property qualifications in lower Houses and to ensure that upper Houses were not democratic363. At federation the most populous States were New South Wales, Victoria, Queensland (which was part of New South Wales until 1859364) and South Australia365. At the time of their preparations for the Bill for the second Reform Act, British politicians, including Benjamin Disraeli, were keen to be informed of the experience of democracy in Australia366, not least because they were interested in knowing whether plural voting successfully retarded the effects of the abovementioned colonial franchises. Whilst the Constitution does not subscribe to any political philosophy, or theory of government, "choice by the people" of parliamentary representatives is 361 (2007) 233 CLR 162 at 174 [7] per Gleeson CJ, 199 [83] per Gummow, Kirby and 362 It can be noted that the Constitutional Act 1854 (Tas) (18 Vict No 17), which was somewhat incomplete, contained property qualifications for electors of the Legislative Assembly. By 1901, residence alone was sufficient qualification. 363 For example, there was a nominee upper House in New South Wales, in which members were nominated for life: 18 & 19 Vict c 54. In Victoria there was an elected upper House, with high property qualifications for both members (at £5000) and electors (at £1000): 18 & 19 Vict c 55. For an account of the institution of the latter, see Parkinson, Sir William Stawell and the Victorian Constitution, (2004) at 23-32. 364 The separation of Queensland from New South Wales was effected by Letters Patent issued 6 June 1859. 365 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 366 Smith, The Making of the Second Reform Bill, (1966) at 76-78, 81, 230-231. Crennan a constitutional notion signifying individual citizens having a share in political power through a democratic franchise. Sections 8, 30 and 41 of the Constitution Before turning to ss 7 and 24 of the Constitution, it is convenient to consider the qualifications in the colonial franchises picked up by ss 8, 30 and 41 for the light they throw on the constitutional imperative of choice by the people. Sections 51(xxxvi), 8 and 30 provide for the making of laws by the Parliament for the qualification of electors. Section 30 states: "Until the Parliament otherwise provides, the qualification of electors of members of the House of Representatives shall be in each State that which is prescribed by the law of the State as the qualification of electors of the more numerous House of Parliament of the State; but in the choosing of members each elector shall vote only once." Section 8 provides: "The qualification of electors of senators shall be in each State that which is prescribed by this Constitution, or by the Parliament, as the qualification for electors of members of the House of Representatives; but in the choosing of senators each elector shall vote only once." Section 41 preserves the rights of women and Aboriginal Australians to vote, to the extent that such rights existed in the colonies at the time of federation367. Section 41 provides: "No adult person who has or acquires a right to vote at elections for the more numerous House of the Parliament of a State shall, while the right continues, be prevented by any law of the Commonwealth from voting at elections for either House of the Parliament of the Commonwealth." Unlike s 51(xxxvi), none of these sections is expressed to be "subject to this Constitution". The colonial franchises picked up by these sections are colonial franchises for the lower Houses. Franchises for colonial upper Houses are not, with respect, relevant to s 30 of the Constitution368. Further, given both the reference to "the 367 R v Pearson; Ex parte Sipka (1983) 152 CLR 254; [1983] HCA 6. 368 Cf McGinty v Western Australia (1996) 186 CLR 140 at 242. See Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at Crennan people" in ss 7 and 24, and the prohibition on plural voting in s 30, the Victorian franchise based on a "very small property qualification as the basis of plural enrolment"369, and property qualifications for plural voting which existed elsewhere370, do not seem to be of any abiding constitutional significance. What were well known in the majority of the colonies of Australia at federation were franchises for colonial lower Houses, based on residential qualifications. Men (generally described as natural-born or naturalised British subjects371) of 21 years of age, who were not subject to a disqualification372, and who satisfied residential qualifications, could vote for the lower Houses of Parliament in New South Wales373, Victoria374, Queensland375, South Australia376 and Western Australia377. In Tasmania, the same applied from 28 January 1901378. Aboriginal Australians were included in those franchises in New South 369 King v Jones (1972) 128 CLR 221 at 234 per Barwick CJ. The Constitution Act Amendment Act 1899 (Vic), s 4 abolished plural voting in Victoria. 370 Provisions permitting plural voting based on property qualifications existed in Queensland, Tasmania and Western Australia. 371 There were some franchises which included "denizens". 372 There were some exclusions from the franchise, such as for persons of unsound mind, in receipt of charity, or who were prisoners. 373 Parliamentary Electorates and Elections Act 1893 (NSW), s 23. 374 Constitution Act Amendment Act 1890 (Vic), s 128. Existing alongside this suffrage there was a non-resident's suffrage based on property qualifications: 375 Elections Act 1885 (Q), s 6(1) and Elections Act 1897 (Q), s 4. Existing alongside this suffrage were suffrages based on both household and property qualifications: ss 6(2) and 6(3) of the 1885 Act. Cf Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 19. 376 Electoral Code 1896 (SA), s 15. 377 Constitution Acts Amendment Act 1899 (WA), s 26. 378 The Constitution Amendment Act 1900 (Tas), s 5, which provided for manhood suffrage, was proclaimed on 28 January 1901. Prior to that date Tasmania coupled a residential qualification with a small property qualification: Constitution Amendment Act (No 2) 1896 (Tas), s 4. Crennan Wales, Victoria, South Australia and Tasmania379. It must be noted that in Queensland and Western Australia, Aboriginal persons had to satisfy a property qualification380. In the Northern Territory section of South Australia, Aboriginal Australians were excluded from the franchise381, and this is recognised in s 25 of the Constitution. Women of 21 years of age, who satisfied residential qualifications, could vote for the lower Houses in South Australia and Western Australia382. Neither enrolment nor voting was compulsory at this time. Given the ban on plural voting in ss 8 and 30 these franchises, based on residential qualifications, were the significant franchises for the referenda for the Constitution and the first Parliament383. Reflecting such matters, ss 8, 30 and 41 were described by Professor Harrison Moore in his text on the Constitution as "designed to secure the 'democratic' principle that the suffrage shall be of the widest, and that no person shall have more than one vote."384 In McKinlay385, McTiernan and Jacobs JJ said of s 24: "it would be nonsense to speak of a choice by a few who happened to be enfranchised (the foundation of an oligarchy) as a choice by the people (the foundation of a democracy)." What has occurred since federation is that a franchise which only avoids arbitrary exclusion based on class cannot possibly be described as democratic. The Constitution, and specifically ss 7 and 24, would constrain any reversion to arbitrary exclusions from the franchise, based on gender and race, of the kind 379 Parliamentary Electorates and Elections Act 1893 (NSW), s 23; Constitution Act Amendment Act 1890 (Vic), s 128; Electoral Code 1896 (SA), s 15; Constitution Amendment Act 1900 (Tas), s 5. 380 Elections Act 1885 (Q), s 6; Constitution Acts Amendment Act 1899 (WA), s 26. 381 Electoral Code 1896 (SA), s 16. 382 Electoral Code 1896 (SA), s 15; Constitution Acts Amendment Act 1899 (WA), 383 R v Pearson; Ex parte Sipka (1983) 152 CLR 254; also, see generally Twomey, "The Federal Constitutional Right to Vote in Australia", (2000) 28 Federal Law Review 125. 384 The Constitution of the Commonwealth of Australia, (1902) at 106. 385 (1975) 135 CLR 1 at 36. Crennan which occurred in one or more colonies at the time of federation386. However, the colonial franchises, based on residential qualifications, were the antithesis of an exclusive suffrage designed to yield an oligarchic representative government. They were expressly designed to yield democratic lower Houses. For both informed people in Australia at the time of federation387, and the framers of the Constitution who had experience as colonial politicians388, the state of the development of representative government which had been reached as at federation was that five of the six States had democratic (that is, not oligarchic) franchises for the lower Houses of Parliament. Tasmania followed from 28 January 1901. Thus one significance of the colonial franchises, for present purposes, is that they assist an understanding of the genesis of the constitutional protection given to the right to vote, to which I will return. Sections 7 and 24 – a drafting consideration Section 24 of the Constitution relevantly provides: "The House of Representatives shall be composed of members directly chosen by the people of the Commonwealth, and the number of such members shall be, as nearly as practicable, twice the number of the senators." The implications of the words "chosen by the people" for the federal franchise were readily understood by the "politically experienced members of the constitutional conventions"389. Workable colonial democracies, based on the colonial franchises, for lower Houses of Parliament, discussed above, must have been familiar to them. It was known, even beyond Australian shores, that plural voting in the colonial lower Houses was intended to dilute the effect of democratic colonial franchises. 386 McGinty v Western Australia (1996) 186 CLR 140 at 221 per Gaudron J, 287 per 387 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 230 per McHugh J. 388 Roach v Electoral Commissioner (2007) 233 CLR 162 at 188-189 [53] per Gummow, Kirby and Crennan JJ; see also Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 234 [150] per Gummow and Hayne JJ. 389 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 19 per Barwick CJ. Crennan At the Convention in Sydney in 1891, the delegates were considering a forerunner of s 7 (cl 9), which relevantly provided: "The senate shall be composed of eight members for each state, directly chosen by the houses of the parliament of the several states during a session thereof, and each senator shall have one vote." It was recognised by Mr Alfred Deakin that, unless the section in the Constitution governing the composition of the Senate was on the same terms as s 24, there would be different constituencies for the House of Representatives and the Senate390. As already mentioned, a number of colonial upper Houses were either nominee houses or elected on restrictive property qualifications. By the 1897 Convention there was support for popular election of the Senate391. Section 7 of the Constitution relevantly provides: "The Senate shall be composed of senators for each State, directly chosen by the people of the State, voting, until the Parliament otherwise provides, as one electorate." In a passage more fully set out in the joint judgment of Gummow and Bell JJ392, Quick and Garran described the principle of popular election for the Senate as being "in harmony with the progressive instincts and tendencies of the times"393. In McGinty394, in relation to the same period, Gummow J said: "Learned commentators observing the situation from a vantage point outside Australia wrote of the extremely 'democratic' nature of the new Constitution, 'the high-water mark of popular representing government'." (footnote omitted) 390 Official Report of the National Australasian Convention Debates, (Sydney), 2 April 1891 at 591-592. 391 Official Record of the Debates of the Australasian Federal Convention, (Sydney), 9 September 1897 at 257. 393 The Annotated Constitution of the Australian Commonwealth, (1901) at 418. 394 (1996) 186 CLR 140 at 271. Crennan In the light of the colonial franchises for lower Houses of Parliament at the time of federation (and notwithstanding their lack of uniformity and deficits in relation to gender and race), ss 7 and 24 would have constrained Parliament from instituting an exclusive federal franchise based on property qualifications, or a franchise which permitted plural voting, for the reason that at the time such franchises would have been considered conspicuously undemocratic. The correct characterisation of the legislative changes to the franchise since the Commonwealth Electoral Act 1902 (Cth) is that a democratic franchise has been widened on the journey to "representative democracy in its purest form"395, that is, universal adult suffrage, in respect of which there are no arbitrary exclusions based on class, gender or race. In McKinlay, as a prelude to treating universal adult suffrage as "an historical development of constitutional significance"396, McTiernan and "the common understanding of the time" of the words "chosen by the people of the Commonwealth"397 in order to acknowledge that common understanding varied over time, in accordance with legislative changes to the franchise. referred Recalling the remarks of Isaacs J in Kreglinger398, the constitutional principles which distinguish between oligarchic and democratic government were fully understood at the time of the commencement of the Constitution and were always in consideration in respect of the drafting of ss 7 and 24. Sections 7 and 24 of the Constitution do not prescribe any particular franchise. However, they constrain the Parliament from instituting a franchise which will result in an oligarchic representative government and mandate a franchise which will result in a democratic representative government, the preferable term used by Mason J in McKinlay399 to describe the system of government, prescribed and maintained by the Constitution. What is sufficient to constitute democratic representative government has changed over time, as conceptions of democracy have changed, to require a fully inclusive franchise – that is, a franchise free of arbitrary exclusions based on class, gender or race. To recognise that ss 7 and 24 mandate a democratic franchise, for the purposes of the popular elections which they prescribe, is to recognise the 395 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 57 per Stephen J. 396 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7] per Gleeson CJ. 397 (1975) 135 CLR 1 at 36. 398 (1926) 37 CLR 393. 399 (1975) 135 CLR 1 at 62. Crennan embedding of the right to vote in the constitutional imperative of choice by the people of parliamentary representatives. Validity The provisions for compulsory enrolment and for the imposition of a penalty for a failure to enrol, or transfer enrolment, within prescribed time limits have been set out in the reasons of others and are not repeated here. Section 101(7) of the Electoral Act provides that a penalty for late enrolment will not be imposed, once enrolment or transfer of enrolment has been attended to. Whilst it is not suggested to be relevant to the plaintiffs, illness is a simple example of a reason for late enrolment, or late transfer, which would not ordinarily be thought to be inexcusable. Examples could be multiplied. Insofar as enrolment is both a legal duty and a civic right, in its operation, s 101(7) privileges the civic right over the legal duty, which is consonant with an electoral process designed to protect the franchise by encouraging enrolment and transfer of enrolment. Provisions governing compulsory voting, upheld as constitutional in Judd v McKeon400, and their legislative history, have also been set out in the reasons of others. The plaintiffs framed their argument, that the impugned provisions were invalid, by reference to the centrality of the existence and exercise of the franchise, which is critical to democratic representative government, and which reflects a citizen's membership of, and participation in, the political life of the community401. It was emphasised in argument that the franchise in respect of parliamentary representatives for the State and Subdivision in which each of the plaintiffs resides is constitutionally protected. The plaintiffs first contended that, in their practical operation, the impugned provisions "disenfranchised" them in the sense used in Roach. The provisions operate in practice to exclude persons such as the first plaintiff from the right to vote, and persons such as the second plaintiff from the right to participate in choosing their correct parliamentary representatives402. 400 (1926) 38 CLR 380; [1926] HCA 33. 401 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7] per Gleeson CJ, 198-199 [83] per Gummow, Kirby and Crennan JJ. 402 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174-175 [8] per Gleeson CJ, 198-200 [81]-[86] per Gummow, Kirby and Crennan JJ. Crennan that Secondly, the plaintiffs submitted the disenfranchisement or exclusion, best described as a disentitlement, was not for a "substantial reason" as explained in Roach403, and that the provisions were arbitrary and disproportionate in relation to maintaining the constitutionally prescribed system of representative government. The term "disproportionate" was employed to describe provisions which were not necessary, appropriate or justifiable in terms of preserving the integrity of the Rolls. In that context, the term "necessary" is not confined to what is "essential" or "unavoidable" but encompasses what is "reasonably appropriate and adapted" to serve a legitimate end. Debate on this aspect of the case was conducted largely by reference to that familiar expression, and this avoided the danger recognised by Gleeson CJ in Mulholland and Roach of referring to proportionality, in the context of the Constitution, so as to evoke considerations relevant only to different constitutional settings404. The Commonwealth (and the Attorney-General for Western Australia, intervening in support of the Commonwealth) accepted that the power to make laws with respect to the qualification of electors, and the conduct of elections, is subject to the constraint that, by ss 7 and 24, each of the Houses of Parliament is to be "chosen by the people". The Commonwealth also accepted that if the impugned provisions, in their practical operation, created a disqualification from what otherwise is adult suffrage, the question to be asked, in terms of Roach, was whether the disqualification is for a "substantial reason". As to the plaintiffs' first argument, the Commonwealth argued that the impugned provisions did not effect a disqualification from the franchise, even though the provisions operated to prevent people from enrolling after a particular date, because s 101 of the Electoral Act imposes a duty on persons who are entitled to be enrolled to become enrolled, and to keep their addresses up to date. In respect of the plaintiffs' cases, it was asserted that they had not taken steps to enrol, or transfer, when required to do so under the Electoral Act. On the plaintiffs' second argument, the Commonwealth submitted that the impugned provisions are not directed to any purpose incompatible with ss 7 and 24. It was contended that the orderly conduct of elections, based on Electoral 403 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174-175 [7]-[8] per Gleeson CJ, 199 [85] per Gummow, Kirby and Crennan JJ. 404 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 199-200 [39]; Roach v Electoral Commissioner (2007) 233 CLR 162 at Crennan Rolls of integrity, is consistent with the constitutionally prescribed system of government, a point which was not in contention between the parties. It was submitted that it is not a prerequisite to the existence of the power to provide a relatively early cut-off date following the announcement of an election, that there be any actual electoral fraud; it is not incompatible with ss 7 and 24 if a purpose of an early cut-off date is to obviate prophylactically a risk of electoral fraud. It was also contended by the Commonwealth that the early cut-off date was directed to enhancement of the integrity of the Electoral Rolls, particularised in two distinct ways: first, it was said the impugned provisions increased the time available to the Australian Electoral Commission for processing enrolment applications before polling day, and secondly, it was said that the impugned provisions would reduce a known phenomenon of a late surge in enrolments by encouraging people not to wait until an election is called before enrolling. The conclusion said to follow was that the disentitlement or exclusion effected by the impugned provisions is appropriate and adapted to the smooth conduct of elections. It can be accepted that the impugned provisions differ from those under consideration in Roach. Nevertheless, they operate to disentitle or exclude persons (otherwise legally eligible) from the right to vote and the right to the State and participate Subdivision in which they reside. It can also be accepted that achieving and maintaining Electoral Rolls of integrity is a purpose which is compatible with ss 7 and 24. in choosing parliamentary representatives for The federal electoral process, characterised by compulsory enrolment and compulsory voting, requires comprehensive and accurate Electoral Rolls. Such Rolls will "guard" and "protect"405 the franchise by ensuring that persons eligible to vote in an election, for their parliamentary representatives, will be able to do so. The Australian Electoral Commission, the independent body charged with maintaining the Electoral Rolls406, was able to process in the usual way any late enrolments under the previous seven day cut-off period407. There was no evidence that fraudulent activity was reduced by the shortening of the seven day cut-off period, nor was there any evidence that systematic electoral fraud 405 Kean v Kerby (1920) 27 CLR 449 at 459 per Isaacs J; [1920] HCA 35. 406 See ss 6 and 7 of the Electoral Act. 407 Joint Standing Committee on Electoral Matters, Report on the Conduct of the 2007 Federal Election and Matters Related Thereto, (2009) at 44 [3.35]. Crennan exists408. The Commonwealth was careful to emphasise that, in the context of a majority of a Joint Standing Committee on Electoral Matters recommending a shortening of the cut-off period409, a concern about electoral fraud had never been put any higher than a concern about the potential for electoral fraud. The statement of agreed facts recorded that, for the general elections of 1993, 1996, 1998 and 2001, some 3.32 per cent, 3.23 per cent, 2.94 per cent and 2.96 per cent respectively of total enrolments were processed, as late enrolment transactions, during the period between the issue of the writs for each of those elections and the closure of the Rolls. In 2004, before the cut-off periods instituted by the 2006 amendments, 423,993 enrolment transactions took place in the period permitted between the issue of the writs and the closure of the Rolls. In 2007, there were 279,469 enrolment transactions between the issue of the writs and the closure of the Rolls. It has already been mentioned that there were at least 100,000 late claims for enrolment in respect of the 21 August 2010 election. In all those circumstances, the impugned provisions have not been shown to be necessary or appropriate for the protection of the integrity of the Rolls, as that object was advanced by the Commonwealth. First, this is because the Australian Electoral Commission had no difficulty in processing the volume of late enrolments which occurred with the previous seven day cut-off period. Secondly, to seek to discourage a surge of late claims for enrolment by disentitling or excluding those making them constitutes a failure to recognise the centrality of the franchise to a citizen's participation in the political life of the community410. Thirdly, the main reason put forward by the Commonwealth as the justification for the impugned provisions – namely, that they will operate to protect the Rolls from the risk of, or potential for, systematic electoral fraud – is to protect the Rolls from a risk or potential which has not been substantiated to date. Accordingly, the justification put forward to support the impugned provisions does not constitute a substantial reason, that is, a reason of real significance, for disentitling a significant number of electors from exercising their right to vote for parliamentary representatives in the State and Subdivision in which they reside. The impugned provisions cannot be reconciled with the constitutional imperative of choice by the people of those representatives. 408 Joint Standing Committee on Electoral Matters, Report on the Conduct of the 2007 Federal Election and Matters Related Thereto, (2009) at 50 [3.59]. 409 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 34-36 [2.114]-[2.125]. 410 See fn 401 above. Crennan Conclusions For these reasons I joined in the orders made on 6 August 2010. I agree with the order proposed by Gummow and Bell JJ otherwise dismissing the application. 386 KIEFEL J. It has been observed that the Constitution does not mandate any particular electoral system, but leaves the choice as to the features of that system to Parliament411. Reid and Forrest412 observed that the Constitution made provision only for the "bare foundations of the electoral law for the representative Parliament of a new nation." The "whole range of matters" which it left unspecified, or subject to change, included methods of voting to elect the members of the two Houses of Parliament, persons authorised to vote, the question of voluntary or compulsory registration of voters, voting itself and the control of Electoral Rolls413. The plaintiffs here contend that ss 7 and 24 of the Constitution effect limitations upon the exercise of legislative power with respect to the Electoral Rolls and claims by persons to be enrolled. They contend that amendments made to the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act") in 2006, which reduced the time within which persons could make a claim for enrolment to vote or for transfer of enrolment, after elections had been called, are invalid. Their argument has two strands. It is submitted that the protection extended to the franchise by ss 7 and 24 requires that Parliament ensures the maximum exercise of the franchise. And it is submitted that the provisions in question go further than is necessary and thereby impermissibly limit the exercise of the franchise. The latter contention invokes notions of proportionality. The provisions of the Electoral Act Parliament has exercised legislative power concerning elections in a number of important respects. It has extended the franchise to all Australian citizens who have attained the age of 18 years414, subject to provisions for 411 McGinty v Western Australia (1996) 186 CLR 140 at 184 per Dawson J, 284 per Gummow J; [1996] HCA 48; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 188 [6] per Gleeson CJ, 207 [64] per McHugh J, 237 [154] per Gummow and Hayne JJ; [2004] HCA 41. 412 Australia's Commonwealth Parliament: 1901-1988, (1989) at 86. 413 Reid and Forrest, Australia's Commonwealth Parliament: 1901-1988, (1989) at 414 Commonwealth Electoral Act 1918 (Cth), s 93(1)(b)(i), together with certain non- citizens whose names were on a Roll before 26 January 1984 and who would be British subjects if the relevant citizenship law had remained in force: s 93(1)(b)(ii). disqualification415. It has made voting at elections compulsory416. It has obliged persons entitled to vote to enrol417. The Electoral Act provides for a Roll of Electors for each State and Territory418. Each State and the Australian Capital Territory are distributed into Electoral Divisions419. Provision is made for a Roll for each Division and a separate Roll for each Subdivision of a Division420. The Rolls are maintained as accurate, but not only for the purpose of ascertaining the entitlement of persons to vote at elections. They are sources of information421 and are used to determine redistributions of Divisions in a State or Territory422. One of the key factors in the assessment, regularly undertaken, of the need for a redistribution, is the number of electors in fact enrolled in a Division at the relevant time423. The accuracy of the Rolls is therefore essential. As presently expressed424, a person who is entitled to be enrolled for any Division425, whether by way of enrolment or transfer of enrolment, is required "forthwith [to] fill in and sign a claim [to enrolment] and send or deliver the claim to the Electoral Commissioner." A person so enrolled is called an Elector426. Any person who is entitled to have his or her name placed on the Roll and whose name is not on the Roll upon the expiration of 21 days from becoming 415 For example, Commonwealth Electoral Act 1918, s 93(8). 416 As introduced by the Commonwealth Electoral Act 1924 (Cth), s 2. 417 Commonwealth Electoral Act 1918, s 101(1). 418 Commonwealth Electoral Act 1918, s 81(1). 419 Commonwealth Electoral Act 1918, s 56. 420 Commonwealth Electoral Act 1918, s 82. 421 Commonwealth Electoral Act 1918, ss 90A, 90B. 422 See Commonwealth Electoral Act 1918, ss 59-78. 423 See Commonwealth Electoral Act 1918, ss 66(3)(a), 73(4)(a). 424 Commonwealth Electoral Act 1918, s 101(1). 425 Section 101 refers to a Subdivision. The Act provides for both Divisions and Subdivisions, but there are no Subdivisions in use. For consistency, I refer to Divisions. 426 Commonwealth Electoral Act 1918, s 4(1), definition of "Elector". so entitled is guilty of an offence, unless he or she proves that the non-enrolment is not a consequence of his or her failure to send or deliver a claim427. This offence provision is ameliorated by a further provision: that, where a person sends or delivers a claim for enrolment, proceedings shall not be instituted against that person for an offence committed before he or she sent or delivered the claim428. Regrettably, and despite the not inconsiderable efforts of the Australian Electoral Commission ("the AEC") and the possibility of prosecution for the abovementioned offence, some persons qualified to vote do not enrol or transfer their enrolment when becoming obliged to do so. Some make their claim at the last possible moment and only when an election has been announced. This is not a new phenomenon. Records of the 2004 federal election disclose that there were 423,993 enrolment transactions (claims for enrolment and updating of existing enrolments) in the nine day period between the announcement of the election and the close of the Rolls. After the close of the Rolls, 168,394 claims were lodged. In 2007, following the amendments in question, when the post-announcement enrolment period was three days for new enrolments and nine days for updating enrolments, there were 279,469 enrolment transactions in that period and a further 100,370 after the close of the Rolls. Following the announcement of the election for the two Houses made in July 2010, some 508,000 claims for enrolment or transfer of enrolment were received and processed onto the Rolls. At the time this matter was heard, the AEC estimated that there might be another 100,000 claims which would not be considered because of the provisions in question, ss 102(4) and 102(4AA) of the Electoral Act. The first and second plaintiffs' claims, to enrolment and transfer of enrolment respectively, were amongst them. Background to the 2006 amendments The 2006 amendments followed a "Report of the Inquiry into the Conduct of the 2004 Federal Election" by the Joint Standing Committee on Electoral Matters ("the JSCEM")429. This was not the first time that the question of the closure of the Rolls had been addressed. The issue had been dealt with on a 427 Commonwealth Electoral Act 1918, s 101(4). 428 Commonwealth Electoral Act 1918, s 101(7). 429 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005). number of occasions prior to the 2004 Election Report. This may explain why the recommendations contained in that Report were not specifically mentioned in either the Explanatory Memorandum or the second reading speech to the Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Bill 2005, the Bill which introduced the provisions here in question. In the Report on the seven day period was recommended430. In another, earlier, report on the integrity of the Rolls431, the JSCEM recommended that the period be shortened so that for new enrolments, the Rolls would close on the day of issue of the writs, and for transfers of enrolment, three days later. the 2001 election, retention of In the 2004 Election Report, the JSCEM observed that the AEC processed approximately 17.5 per cent of the enrolment transactions for the whole year in the seven days before Roll closure432. It was considered that this limited the AEC's ability to conduct the thorough checks necessary to ensure the integrity of the Rolls433 and that the "period of grace", of seven days, actually encouraged electors or potential electors to neglect their obligations and attempt to "catch up" in that period434. The JSCEM had referred, in the latter regard, to the fact that 60.5 per cent of the enrolment transactions which occurred in that period would not have been necessary if electors, or potential electors, had fulfilled their statutory obligation to enrol or update their enrolment details within 21 days of becoming so 430 Joint Standing Committee on Electoral Matters, The 2001 Federal Election: Report of the Inquiry into the conduct of the 2001 Federal Election, and matters related thereto, (2003) at 63 [2.175]. 431 Joint Standing Committee on Electoral Matters, User friendly, not abuser friendly: Report of the Inquiry into the Integrity of the Electoral Roll, (2001) at 50 [2.133]. 432 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 34 [2.112]. 433 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 34 [2.113]. 434 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 35 [2.116]-[2.117]. entitled435. Because the "period of grace" encouraged reliance upon the extra time allowed, it was considered by the JSCEM to serve "to decrease the accuracy of the roll during non-election periods"436. Further, unsuccessful attempts by the AEC to maintain the Rolls as current caused a significant wastage of taxpayer funds, the JSCEM said437. The JSCEM went on to say that it "also agrees that the current close of roll arrangements present an opportunity for those who seek to manipulate the roll to do so at a time where little opportunity exists for the AEC to undertake the thorough checking required [for] ensuring roll integrity."438 Dealing with the argument that there was no proof of electoral fraud sufficiently widespread to warrant any action, the JSCEM said that that approach "missed the point"439, which was that steps should be taken to prevent fraud. Following upon the recommendations of the JSCEM, and after the further recommendation of the Senate Finance and Public Administration Committee that the Bill be passed440, amendments were effected to the Electoral Act441. Section 102(4) provides that a claim for enrolment made after 8.00 pm on the date of the writ for an election is not to be considered until after the close of 435 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 34 [2.114]. 436 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 35 [2.117]. 437 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 35 [2.120]. 438 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 35 [2.121]. 439 Joint Standing Committee on Electoral Matters, The 2004 Federal Election: Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto, (2005) at 35 [2.122]. 440 The Senate, Standing Committee on Finance and Public Administration, Electoral and Referendum Legislation Amendment Bill 2006, (2007) at 6 [2.27]. 441 Electoral and Referendum Amendment (Electoral Integrity and Other Measures) Act 2006 (Cth). polling at the election. Section 102(4AA) provides that a claim to have an enrolment transferred made after 8.00 pm on the date of the close of the Roll for the relevant Division is not to be considered until after the close of polling at the election. According to s 155(1), for a claim to transfer enrolment, this is the third working day after the date of the writ. The plaintiffs' circumstances On Saturday, 17 July 2010 the Prime Minister announced that an election of both Houses was to be called. The writs for those elections were obtained very shortly afterwards, on Monday, 19 July 2010. The first plaintiff therefore had until 8.00 pm on 19 July 2010 to enrol for the election and the second plaintiff until 8.00 pm on Thursday, 22 July 2010 to transfer his enrolment. The first plaintiff attained the age of 18 years on 16 June 2010. When the election was announced she had not enrolled. She attempted, unsuccessfully, to do so on the day of issue of the writs, Monday, 19 July 2010. She did not lodge a claim until Friday, 23 July 2010. The second plaintiff was 23 years of age at the relevant times. He changed his address to one in another Division in March 2010. He did not advise the AEC of this, as he was required to do. He attempted to do so on the day before the election was called, but was also unsuccessful in submitting the claim. He also lodged his claim on 23 July 2010. Neither of the plaintiffs fulfilled their obligations as required by s 101 of the Electoral Act. Their failure to do so cannot be disregarded when considering the operation and effect of the provisions in question, and whether they were unreasonable or disproportionate, as the plaintiffs contend. Neither plaintiff suggested that it was not possible for them to have enrolled when required and thereby have achieved the status of Elector for their Division. It was not suggested that it was not possible for them to have done so in the time allowed after the election was called. Their case is that they should have been allowed more time. The plaintiffs' claims The plaintiffs' argument centres upon two questions, which are said to arise from the joint judgment (Gummow, Kirby and Crennan JJ) in Roach v Electoral Commissioner442, namely: 442 (2007) 233 CLR 162; [2007] HCA 43. (1) whether the impugned provisions disenfranchise any group of adult citizens or otherwise disentitle or exclude them from casting a vote for their representatives; and (2) whether the disenfranchisement, disentitlement or exclusion is for a "substantial reason" or is "disproportionate". Roach concerned the disqualification, from voting at federal elections, of all persons serving a sentence of imprisonment. The majority held that the provisions in question were invalid. It was held that ss 7 and 24 of the Constitution limit the scope of laws affecting the franchise443 and that a disqualification from the exercise of the franchise could only be made for a "substantial" reason, so as to be consistent with "choice by the people"444. The latter question, concerning the legislative disqualification, was said, in the joint reasons, to require consideration of questions of proportionality445. Gleeson CJ considered the disenfranchisement, given the constitutional imperative of "chosen by the people" appearing in ss 7 and 24446. The majority concluded that the provisions were arbitrary in their effect and therefore did not provide a sufficient reason for disenfranchisement447. rational connection was necessary to explain that a Disenfranchisement? Sections 7 and 24 commence with a statement concerning the composition of the Senate and the House of Representatives, each of which is "directly chosen by the people" of the State (s 7) and the Commonwealth (s 24). Those sections are emphatic of two factors: direct elections and a popular vote448. 443 Roach v Electoral Commissioner (2007) 233 CLR 162 at 187 [49]. 444 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7] per Gleeson CJ, 199 [85] per Gummow, Kirby and Crennan JJ. 445 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85]. 446 Roach v Electoral Commissioner (2007) 233 CLR 162 at 182 [24]. 447 Roach v Electoral Commissioner (2007) 233 CLR 162 at 182 [23] per Gleeson CJ, 200-201 [90] per Gummow, Kirby and Crennan JJ. 448 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 21 per Barwick CJ; [1975] HCA 53. See also McGinty v Western Australia (1996) 186 CLR 140 at 279 per Gummow J; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 236 [153] per Gummow and Hayne JJ. The plaintiffs did not contend that the joint reasons in Roach spoke of an individual having a right to vote protected by ss 7 and 24. The concern expressed in the joint reasons was with respect to the importance of the franchise to the maintenance of the system of government upon which the Constitution is based. The existence and exercise of the franchise were said to reflect "notions of citizenship and membership of the Australian federal body politic."449 And it was said that such notions were "not extinguished by the mere fact of imprisonment"450, as a prelude to posing the question in that case: whether the disqualification was for a substantial reason451. But nowhere was it said that what was at issue was an individual right to vote. It was expressly stated in the joint reasons in Roach that the case concerned the "denial of entitlement to cast any vote at all", not "the existence of an individual right, but rather the extent of the limitation upon legislative power derived from the text and structure of the Constitution and identified in Lange."452 In Lange v Australian Broadcasting Corporation453 it was said that ss 7 and 24 "do not confer personal rights on individuals. Rather they preclude the curtailment of the protected freedom by the exercise of legislative or executive power."454 The implied freedom there in question was that of communication on political matters. In Roach Gleeson CJ did make reference to "the right to vote". His Honour said that, having regard to what had been said in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth455 by McTiernan and Jacobs JJ, he saw "no reason to deny that … the words of ss 7 and 24, because of changed historical circumstances including legislative history, have come to be a constitutional protection of the right to vote."456 McTiernan and Jacobs JJ had said that "the long established universal adult suffrage may now be recognized as 449 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [83]. 450 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [84]. 451 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85]. 452 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199-200 [86]. 453 (1997) 189 CLR 520; [1997] HCA 25. 454 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. 455 (1975) 135 CLR 1 at 36. 456 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7]. a fact"457. In context, Gleeson CJ may have been referring to what is generally described as an incident of universal adult suffrage, rather than an individualised view of "the franchise" which is protected by ss 7 and 24. His Honour had earlier referred to the dictionary definition of "universal suffrage", which, it may be expected, was given as the right of all adults to vote458. Earlier authority is expressive of those enfranchised in a collective sense. In McKinlay459 McTiernan and Jacobs JJ pointed out that it was incorrect to equate "the people" referred to in s 24 with electors, or as taking account of those enfranchised individually. Rather, the term referred to a collective body. Gibbs J compared the use of the word "electors" in other sections (s 41 being one) with the use of "the people" in s 24460. References to "the franchise" should therefore be understood to refer, collectively, to those people who are qualified to vote. Individuals cannot be selected by legislation for disqualification. Therefore disenfranchisement or exclusion from voting refers to a disqualification of a class of people. "Chosen by the people" refers to the election of a representative by all those qualified to vote, who do vote. The importance of the existence and maintenance of voting to the system of representative government upon which the Constitution is based must not be underestimated. But the provisions here in question are not directed to voting and do not disqualify any group of persons from voting. They limit the time for enrolment. They cannot be said to be so certain, and of such magnitude, in their effect as to affect the franchise, in the sense referred to above. What the plaintiffs complain of is that the provisions have the potential to render a person unable to vote, if he or she fails to comply with their obligations respecting enrolment. The provisions may therefore raise questions about proportionality, but they do not establish disentitlement, without more. The argument developed by the plaintiffs, in response to these limitations, was that the legislation must ensure the maximum participation of voters. This 457 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 458 Roach v Electoral Commissioner (2007) 233 CLR 162 at 173 [6]. 459 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 460 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 44. See also Langer v The Commonwealth (1996) 186 CLR 302 at 332 per Toohey and Gaudron JJ; [1996] HCA 43. was not a matter in issue, and therefore was not considered, in Roach. It is said to be required as an expression of "chosen by the people" and because a system of representative government requires such participation. The plaintiffs' argument therefore assumes a constitutional imperative. The description given by Isaacs J in Judd v McKeon461 of elections as "expressive of the will of the community", properly understood, does not support the plaintiffs' argument for a constitutional requirement regarding maximum participation. The statement was taken from the following passage of his Honour's reasons: "The community organized, being seised of the subject matter of parliamentary elections and finding no express restrictions in the Constitution, may properly do all it thinks necessary to make elections as expressive of the will of the community as they possibly can be." In Judd v McKeon the Court was concerned with the validity of provisions rendering it an offence under the Electoral Act for electors to fail to vote, consequent upon voting having been made compulsory. The Court confirmed that Parliament may prescribe compulsory voting. In context, therefore, Isaacs J was affirming parliamentary power with respect to elections in the passage quoted and the lack of restrictions evident in the Constitution upon that power. His Honour, in referring to elections being "as expressive of the will of the community as they possibly can be", was not expressing a constitutional restriction, but an ideal. to a Considerations of representative government do not point constitutionally derived requirement in the terms for which the plaintiffs contended. To the contrary, the power given to Parliament to legislate with respect to elections should not be seen as fixed by reference to a requirement that the greatest number of people as possible vote. In McGinty v Western Australia462 Gummow J cautioned that: "To adopt as a norm of constitutional law the conclusion that a constitution embodies a principle or a doctrine of representative democracy or representative government (a more precise and accurate term) is to adopt a category of indeterminate reference." (footnote omitted) 461 (1926) 38 CLR 380 at 385; [1926] HCA 33. 462 (1996) 186 CLR 140 at 269. His Honour observed that this would allow a wide range of variable judgments in these principles or doctrines463. the Brennan CJ464 said that: interpretation and application of "It is logically impermissible to treat 'representative democracy' as though it were contained in the Constitution, to attribute to the term a meaning or content derived from sources extrinsic to the Constitution and then to invalidate a law for inconsistency with the meaning or content so attributed." It is difficult to identify what is essential to representative government, not the least because ideas about it may change over time. In McKinlay Stephen J suggested that it may be possible to identify a quality which is essential to representative democracy as absent, but not possible to identify a requirement so essential as to be determinative of the existence of representative democracy465. In Mulholland v Australian Electoral Commission466 Gleeson CJ observed that a notable feature of our system of government is how little of the detail of it is to be found in the Constitution and how much is left to be filled in by Parliament467. Gummow J has explained that the Constitution allowed for further legislative evolution in the system of representative government and thereby avoided constitutional rigidity468. It was necessary to rely upon later provision by Parliament, because agreement could not be reached on many matters469. It is necessary to bear in mind that, at the time of federation, democracy was not a perfectly developed concept470. No one view prevailed. If the framers of the Constitution did have a view about what was the most appropriate electoral 463 McGinty v Western Australia (1996) 186 CLR 140 at 269-270. 464 McGinty v Western Australia (1996) 186 CLR 140 at 169. 465 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 466 (2004) 220 CLR 181. 467 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 188 [6]. 468 McGinty v Western Australia (1996) 186 CLR 140 at 269. 469 McGinty v Western Australia (1996) 186 CLR 140 at 280 per Gummow J. 470 McGinty v Western Australia (1996) 186 CLR 140 at 221 per Gaudron J. system, they did not express it in the Constitution471. Any views they may have had remain at best "unexpressed assumptions" on which the framers proceeded472. Sections 10 and 31 of the Constitution, which, together with s 51(xxxvi), provide for laws respecting elections to the Houses, commence with the words "[u]ntil the Parliament otherwise provides". The words accommodate the notion that representative government is a dynamic institution, as Gummow J observed in McGinty473. In Mulholland Gummow and Hayne JJ474 said that, because "[u]ntil the Parliament otherwise provides" allows for change, care must be taken in elevating a "direct choice" principle to a broad restraint upon legislative development. This assumes particular importance in this case. In McKinlay Stephen J475 said that the principle of representative democracy predicates the enfranchisement of electors, the existence of an electoral system capable of giving effect to the selection of representatives and the bestowal of legislative functions on the representatives selected. But, his Honour added, the quality and character of each of the three ingredients is not fixed or precise. In each there is scope for variety. In relation to the electoral system, it includes matters which may affect the significance of the vote given. The unstated, but essential, premise for the plaintiffs' argument of maximum participation in the franchise is that all those entitled to vote must vote. Compulsory voting has been required since 1924. It was recognised in Judd v McKeon as a legislative choice. It is not reflective of any constitutional requirement. To the contrary, the constitutional intendment is that such matters remain subject to the exercise of parliamentary choice, as conceptions of representative government and democracy change and adapt. 471 McGinty v Western Australia (1996) 186 CLR 140 at 184 per Dawson J. 472 Australian National Airways Pty Ltd v The Commonwealth ("the Airlines Nationalisation Case") (1945) 71 CLR 29 at 81 per Dixon J; [1945] HCA 41. 473 McGinty v Western Australia (1996) 186 CLR 140 at 280; see also at 200 per Toohey J. And see Kirk, "Constitutional Implications from Representative Democracy", (1995) 23 Federal Law Review 37 at 50; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 237 [155] per Gummow and 474 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 237 [156]. 475 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 Parliament may consider that compulsory voting remains appropriate to Australia, to a sense of social obligation of participation in the franchise, and therefore continues that system of voting. It is not the preferred system in many other countries which have forms of representative government. It would be unwise to assume that such a system will continue to be maintained in Australia. Compulsory voting cannot be regarded as essential to our representative government here. It would be wrong to take steps towards effectively entrenching it by requiring that legislation concerning elections ensure the maximum exercise of the franchise. It would be inconsistent with the intention expressed in the Constitution: that Parliament be free to legislate in this area from time to time. Proportionality The plaintiffs' submissions also described the effect of the provisions in question as a "burden" upon their entitlement to enrol and vote, as distinct from an outright disentitlement. Consideration of the extent of the effects of legislative measures raises questions of proportionality. The term "proportionality" implies a relationship between things. A definition of "proportion", in the sense of being in or having a due or proper proportion, is given as the "[d]ue relation … between things or parts of a thing as renders the whole harmonious; balance, symmetry, agreement, harmony."476 It has been suggested that proportionality is a part of, but not a synonym for, the requirement that a law be "reasonably appropriate and adapted"477. If this is the case, notions of proportionality may be somewhat obscured by that expression. In the Australian constitutional context, proportionality may generally be said to involve considerations of the relationship between legislative means and constitutionally legitimate ends, or the effect of legislative means, or measures, upon matters the subject of constitutional protection or guarantee. The expression "reasonably appropriate and adapted" was imported into Australian constitutional law some time ago from the United States constitutional context. The term "proportionality" has its origins in Germany. It has been influential in many legal systems, in Europe and elsewhere, as a principle applied 476 The Oxford English Dictionary, 2nd ed (1989), vol 12 at 647, sense 4. 477 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 321 per Brennan J; [1994] HCA 44. See also Richardson v Forestry Commission (1988) 164 CLR 261 at 311-312 per Deane J, 346 per Gaudron J; [1988] HCA 10; Zines, "Constitutionally Protected Individual Rights", in Finn (ed), Essays on Law and Government: Volume 2 – The Citizen and the State in the Courts, (1996) 136 at 156. to test the validity of legislation478, particularly where legislation effects a restriction of a protected interest. Both expressions, "proportionality" and "reasonably appropriate and adapted", are used in the joint judgment in Roach. The plaintiffs' reliance on what was said in Lange and in Roach concerning proportionality raises questions about its meaning, its use and how it might apply in the circumstances of this case. In the joint judgment in Roach it was said that a valid disqualification of prisoners required a "substantial reason". Their Honours said479: "A reason will answer that description if it be reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government. When used here the phrase 'reasonably appropriate and adapted' does not mean 'essential' or 'unavoidable'. Rather, as remarked in Lange, in this context there is little difference between what is conveyed by that phrase and the notion of 'proportionality'. What upon close scrutiny is disproportionate or arbitrary may not answer to the description reasonably appropriate and adapted for an end consistent or compatible with observance of the relevant constitutional restraint upon legislative power." (footnotes omitted) In Lange480 the Court said that the freedom of communication which the Constitution protects is not absolute. It operates as a restriction upon legislative power, but will not invalidate a law having a legitimate object or end if the law satisfies two conditions481: "The first condition is that the object of the law is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government … The second is that the law is reasonably appropriate and adapted to achieving that legitimate object or end." 478 And also administrative action, but that may be put to one side. 479 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85] per Gummow, 480 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561. 481 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562. The Court went on482: "Different formulae have been used by members of this Court in other cases to express the test whether the freedom provided by the Constitution has been infringed. Some judges have expressed the test as whether the law is reasonably appropriate and adapted to the fulfilment of a legitimate including Others have favoured different expressions, purpose. proportionality. In the context of the questions raised by the case stated, there is no need to distinguish these concepts." "Reasonably appropriate and adapted" The phrase "reasonably appropriate and adapted" (to a legitimate end) has a long history in Australian constitutional law. It derived from Marshall CJ's judgment in McCulloch v Maryland483 and was applied in Jumbunna Coal Mine NL v Victorian Coal Miners' Association484 and following cases485. In McCulloch a question with which Marshall CJ was concerned was whether Congress had the power to incorporate a bank. It was held that it was authorised by the Constitution to pass all laws "necessary and proper" to carry into execution the express powers conferred upon it486. It could therefore incorporate a bank if that was a suitable mode of executing the powers of government. The width of legislative discretion was therefore the context for the often-cited passage from his Honour's reasons487: "Let the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the constitution, are constitutional." 482 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 562. 483 17 US 316 at 421 (1819). 484 (1908) 6 CLR 309; [1908] HCA 95. 485 Including Mulholland v Australian Electoral Commission (2004) 220 CLR 181. 486 McCulloch v Maryland 17 US 316 at 412 (1819). 487 McCulloch v Maryland 17 US 316 at 421 (1819). In Federated Saw Mill &c Employes of Australasia v James Moore & Son Pty Ltd488 O'Connor J described the principle enunciated in McCulloch, and followed in Jumbunna, as being: "when the object aimed at is within the limits of the power, the legislature cannot be interfered with or controlled as to the mode in which it may deem fit to exercise the power, provided that it chooses means which are appropriate and fairly adapted to the object." The enquiry whether a law is "with respect to" a constitutional head of power is, clearly enough, concerned with the law's connection to that power. In The Commonwealth v Tasmania (The Tasmanian Dam Case)489, Deane J introduced the term "proportionality" to the question whether a law could be characterised by reference to a constitutional head of power. His Honour said490: "Implicit in the requirement that a law be capable of being reasonably considered to be appropriate and adapted to achieving what is said to provide it with the character of a law with respect to external affairs is a need for there to be a reasonable proportionality between the designated purpose or object and the means which the law embodies for achieving or procuring it. … The absence of any reasonable proportionality between the law and the purpose of discharging the obligation under the convention would preclude characterization as a law with respect to external affairs". One enquiry as to proportionality therefore concerns the means or measures employed by the legislation to achieve or procure the designated purpose. There may be other approaches to it. Marshall CJ's reference to appropriateness suggests an enquiry as to the suitability of the means for the designated purpose. Any test for proportionality must then reside in the words "plainly adapted to that end". Later in his reasons, Marshall CJ referred to the "means" as being "adequate to its ends"491. This description may suggest that the operation and effect of a law must be necessary to achieve the designated purpose. A requirement of necessity suggests that the law must not stray too far from the bounds of that purpose. In Mulholland 488 (1909) 8 CLR 465 at 510; [1909] HCA 43. 489 (1983) 158 CLR 1; [1983] HCA 21. 490 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 491 McCulloch v Maryland 17 US 316 at 424 (1819). Gleeson CJ observed that there is a long history of the use, legislatively and judicially, of the term "necessary" and equated its meaning with "reasonably appropriate and adapted"492. Reasonable necessity – a test of proportionality "Reasonable necessity" has long been used as a test, or legal criterion, of the validity of legislation493. Nowhere is this clearer than in cases involving s 92 of the Constitution and the freedom of trade, commerce and intercourse among the States which is the subject of its protection. In Permewan Wright Consolidated Pty Ltd v Trewhitt494 Stephen J said that if regulations affecting interstate trade are to be valid, the restrictions which they impose must be no greater than are reasonably necessary in all the circumstances. Where the restrictions were severe in their effect, it would be important for the court to look to whether there were other means of attaining the legitimate end which were less injurious to interstate trade495. An essential qualification to the test as stated is that the identified alternative measure be "as practicable as the law in question."496 This is an important qualification. It helps to maintain legislative choice and avoids unwarranted substitution. The question whether other measures are as effective may be a question of fact497. In cases involving s 92 it may require expert economic opinion498. 492 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 199-200 493 Thomas v Mowbray (2007) 233 CLR 307 at 332 [24] per Gleeson CJ; [2007] HCA 494 (1979) 145 CLR 1 at 31; [1979] HCA 58. 495 Permewan Wright Consolidated Pty Ltd v Trewhitt (1979) 145 CLR 1 at 31. See also Uebergang v Australian Wheat Board (1980) 145 CLR 266 at 306 per Stephen and Mason JJ; [1980] HCA 40. 496 Uebergang v Australian Wheat Board (1980) 145 CLR 266 at 306 per Stephen and 497 Uebergang v Australian Wheat Board (1980) 145 CLR 266. 498 Such evidence is not usually provided – see Sir Anthony Mason, "Law and Economics", (1991) 17 Monash University Law Review 167 at 176. The approach discussed, which enquires as to the availability of alternative, practicable and less restrictive measures, finds clear expression in the judgment of Mason J in North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW499, where his Honour held that the method chosen to regulate trade in milk had not been shown to be the "only practical and reasonable mode" which would achieve the objective of ensuring the high quality of the milk and protecting public health. More recently, in Betfair Pty Ltd v Western Australia500, the test of reasonable necessity propounded in North Eastern Dairy Co was accepted as a doctrine of the Court501. It was regarded as consistent with what had been said in Cole v Whitfield502, where the Court held that the provision in question was a "necessary means of enforcing the prohibition against the catching of undersized crayfish in Tasmanian waters." In Betfair the prohibitions against the use of betting exchanges in Western Australia were argued to be necessary for the protection of the racing industry in that State. However, in the joint judgment it was said503: "But, allowing for the presence to some degree of a threat of this nature, a method of countering it, which is an alternative to that offered by prohibition of betting exchanges, must be effective but non-discriminatory regulation. That was the legislative choice taken by Tasmania and it cannot be said that that taken by Western Australia is necessary for the protection of the integrity of the racing industry of that State. In other words, the prohibitory State law is not proportionate; it is not appropriate and adapted to the propounded legislative object." 499 (1975) 134 CLR 559 at 616; [1975] HCA 45. 500 (2008) 234 CLR 418; [2008] HCA 11. 501 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 477 [103] per Gleeson CJ, Gummow, Kirby, Hayne, Crennan and Kiefel JJ. 502 (1988) 165 CLR 360 at 409; [1988] HCA 18. 503 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 479 [110]. And it was concluded that504: "it cannot be found in this case that prohibition was necessary in the stated sense for the protection or preservation of the integrity of the racing industry." It follows that, although the expressions "appropriate and adapted" and "proportionate" were used, the test applied was that of the availability of alternative, practicable and less restrictive measures. The test has been applied in cases involving the implied freedom of communication on political matters. In Lange, reference was made to the decision of the majority in Australian Capital Television Pty Ltd v The Commonwealth ("ACTV")505, by way of explication of the second condition for validity referred to in Lange; namely, that the law be "reasonably appropriate and adapted to serve a legitimate end"506. Lange explained the majority decision in ACTV, which held invalid legislation which seriously impeded discussion during the course of a federal election, as grounded upon the fact that "there were other less drastic means by which the objectives of the law could be achieved."507 There may be other views about the ratio in ACTV, but the point to be made, for present purposes, is that Lange recognises the test of proportionality just discussed: reasonable necessity assessed by the availability of alternative measures. Cases involving s 92 proceed upon an acceptance that the freedoms guaranteed by that section are not absolute. The same may be said of other, implied, freedoms508. It has been pointed out that, once it is accepted that a guarantee is not absolute, some test of what constitutes a legitimate type or level of restriction must be developed509. This serves as a reminder of the wider concern of the test discussed, indeed of all tests of proportionality. Its concern is not just about how the objectives of the legislation in question may otherwise be 504 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 480 [112]. 505 (1992) 177 CLR 106; [1992] HCA 45. 506 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567. 507 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568. 508 See Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 142 per Mason CJ. 509 Kirk, "Constitutional Implications from Representative Democracy", (1995) 23 Federal Law Review 37 at 41. fulfilled. It is used to determine the limits of legislation which restricts a freedom guaranteed by the Constitution. When alternative, practicable measures, less restrictive of a freedom, are available, it may be concluded that the measures in question are not reasonably necessary. They go too far and are disproportionate. The limits of legislative power are thereby determined. But there may be other methods of answering the question. Other tests of proportionality? A test of reasonable necessity, by reference to alternative measures, may not always be available or appropriate having regard to the nature and effect of the legislative measures in question. In Davis v The Commonwealth510, Nationwide News Pty Ltd v Wills511 and ACTV, lack of proportionality was assessed by reference to a range of factors. The legislation in Davis was seen as disproportionate, by reference to the severity of its effects upon freedom of expression and the need identified by its objects. The provisions of the Australian Bicentennial Authority Act 1980 (Cth) made it an offence for a person, without the consent of the Australian Bicentennial Authority, to use its name or any prescribed expression, such as "Bicentenary", "Expo", "Melbourne" and "Sydney", in connection with a business, trade, or the sale or supply of goods. Articles or goods used as a means by which such an offence was committed were liable to forfeiture. After some illustrations of the operation of the provisions in question it was said that512: "the effect of the provisions is to give the Authority an extraordinary power to regulate the use of expressions in everyday use in this country, though the circumstances of that use in countless situations could not conceivably prejudice the commemoration of the Bicentenary or the attainment by the Authority of its objects. In arming the Authority with this extraordinary power the Act provides for a regime of protection which is grossly disproportionate to the need to protect the commemoration and the Authority." Although the statutory regime may have been related to a legitimate end, it was said that "the provisions in question reach too far" and that "[t]his extraordinary 510 (1988) 166 CLR 79; [1988] HCA 63. 511 (1992) 177 CLR 1 at 31; [1992] HCA 46. 512 Davis v The Commonwealth (1988) 166 CLR 79 at 99-100 per Mason CJ, Deane and Gaudron JJ, Wilson and Dawson JJ agreeing at 101. intrusion into freedom of expression is not reasonably and appropriately adapted to achieve the ends that lie within the limits of constitutional power."513 The legislation in Nationwide News514 created offences for the use of words, in the nature of criticism, about the Industrial Relations Commission and its members, but it did not provide for defences usual to contempt and defamation, such as justification and fair comment. The provisions were held invalid. Mason CJ and McHugh J held that the extent of the protection provided was unnecessary and therefore disproportionate. Gaudron J agreed with this conclusion515. Mason CJ reached his conclusion by reference to the extent of the adverse impact of the provisions upon freedom of expression516. McHugh J used the same terms as had been employed in Davis – an "extraordinary intrusion" that was "grossly disproportionate to its need" – and concluded that the legislation went "well beyond" the protection required517. Deane and Toohey JJ discussed the nature of the interest sought to be protected by the legislation and held that the measures went "far beyond" what could be considered necessary in the public interest518. Mason CJ compared the measures with the level of protection under which courts function. This did not suggest that the Commission required more extrinsic powers519. Brennan J identified a lesser restriction which could have been effected520. Of the implied freedom of communication on political matters, Mason CJ said, in ACTV, that the guarantee does not postulate that it will always prevail over competing public interests521. The admission that the freedom cannot be regarded as absolute once again highlights the need for a test such as proportionality. 513 Davis v The Commonwealth (1988) 166 CLR 79 at 100. 514 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 35. 515 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 95. 516 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 34. 517 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 101, 102. 518 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 78. 519 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 33-34. 520 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 53. 521 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 Having identified the interests that the legislation sought to advance, his Honour turned his attention to the nature of the interests in question in that case, which were to be seen as protected by the implied freedom. His Honour did so through the viewpoint of the restrictive effect that laws might have upon different kinds of communication. His Honour distinguished laws effecting restrictions upon information or ideas from those which restricted an activity or mode of communication. In the case of the former, his Honour suggested that, speaking generally, it would be extremely difficult to justify such restrictions, implying that the nature of a protected interest may weigh heavily against any form of restriction. His Honour said a "compelling justification" would be required to warrant a restriction522. Even then, the measures must be no more than is reasonably necessary to achieve the public interest said to justify the restriction. His Honour added that it may be necessary to weigh the competing public interest against the restriction of freedom of communication, although, ordinarily, paramount weight would be given to the freedom523. On the other hand, his Honour considered that restrictions imposed on the mode of communication of ideas or information may be more susceptible of justification. In such a case, his Honour suggested, a balancing of interests may be necessary, as well as a determination whether the restriction is reasonably necessary to achieve the competing public interest. If the restriction is disproportionate in that regard, then its purpose may be taken to impair the freedom524. Mason CJ was alone in this approach to proportionality in ACTV. Deane and Toohey JJ approached the question of proportionality by reference to the character of the law, holding that a law with respect to the prohibition or restriction of communications would be more difficult to justify525 than others. Their Honours regarded the effect of the legislation as going beyond what was reasonably necessary in a democratic society, because it distorted the freedom of 522 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 523 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 524 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 525 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 political communication which underlies representative government. Brennan J considered the proportionality between the restriction effected by the law on the freedom and the legitimate interest the law was intended to serve526. Mason CJ's approach, of the identification of the particular interests in question which are the subject of the constitutional guarantees, has not been taken up in cases subsequent to ACTV. In Lange and Roach in particular, the interest said to be protected was stated in wide terms – as the system of government prescribed by the Constitution. Such differences of approach are important to an assessment of proportionality, for they define the relationship which is its subject. It may be said, by reference to these cases, that assessments of proportionality in Australian law involve a range of discernible tests and the identification of various factors which are relevant to the relationship of the legislation in question to its purposes or to interests the subject of constitutional protection. This invites comparison with the position in countries where tests are more clearly defined and openly stated. Proportionality – European law In Roach Gleeson CJ expressed concern about the importation of the concept of proportionality into the Australian constitutional context527. This was not the first occasion upon which concerns of this kind had been expressed528. In Mulholland Gleeson CJ had observed that the use of the term "proportionality" has the advantage that it is commonly used in other jurisdictions, in similar fields of discourse, and the disadvantage that it has there taken on different elaborations which may be imported into a different legal context without explanation529. However, despite his misgivings, his Honour said in Roach that he found aspects of the reasoning of the courts of other jurisdictions "instructive"530. Gleeson CJ's qualification in Mulholland is important. It requires that any derivation from the principle be critically analysed. 526 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 527 Roach v Electoral Commissioner (2007) 233 CLR 162 at 178 [17]. 528 See for example Leask v The Commonwealth (1996) 187 CLR 579 at 600-601 per Dawson J; [1996] HCA 29. 529 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 197-198 530 Roach v Electoral Commissioner (2007) 233 CLR 162 at 179 [17]. There is no doubt that the principle has a different status in other legal systems. In Germany and the European Community, to which I shall shortly refer, it has, respectively, the status of a constitutional principle531 and a general principle of wide application. The context in which it is applied, the extent to which account is taken of legislative discretion, and the extent to which legislation is required to conform to higher principles, may differ. Nevertheless, the question to which it is directed is common to these systems and our own. It is how to determine the limit of legislative power, where its exercise has the effect of restricting protected interests or freedoms. The methods used to test the principle of proportionality are rational and adaptable. Some bear resemblance to tests which have already been utilised in this Court. Further, proportionality is a principle having its roots in the rule of law532. That rule is reflected in the legislative judgments of disqualification as arbitrary and therefore disproportionate. in Roach, which the majority rejected the It should not be assumed that the application of identifiable tests of proportionality will lead to widening, impermissibly, the scope of review of legislation. The statement and explication of the tests employed in the assessment of proportionality should result in a more rigorous and disciplined analysis and render the process undertaken more clear. Once it is acknowledged that constitutional protections are not absolute, some test must be utilised in an assessment of proportionality, as has earlier been observed. It is preferable to identify how that assessment is undertaken in order to avoid the invocation of proportionality as a mere statement of conclusion. The principle of proportionality has its clearest expression in Germany. In its earlier form, as a principle of necessity, it appeared at the end of the 19th century, as a response to excessive police powers in Prussia, although its origins are said to be more ancient533. Its main purpose is the protection of fundamental freedoms. Professor Jürgen Schwarze explains that534: "where intervention by the public authorities is justified by reference to social objectives, such intervention must be limited by its effectiveness and consequently also by its proportionality in relation to the interest it seeks to defend." 531 Schwarze, European Administrative Law, rev ed (2006) at 688. 532 Schwarze, European Administrative Law, rev ed (2006) at 712. 533 Schwarze, European Administrative Law, rev ed (2006) at 685-686; Currie, The Constitution of the Federal Republic of Germany, (1994) at 307. 534 Schwarze, European Administrative Law, rev ed (2006) at 679. There is general agreement that proportionality is tested by reference to three factors, or sub-principles, in Germany535: "(1) First, the state measures concerned must be suitable for the purpose of facilitating or achieving the pursued objective. Second, the suitable measure must also be necessary, in the sense that the authority concerned has no other mechanism at its disposal which is less restrictive of freedom[536]. … [Third], the measure concerned may not be disproportionate to the restrictions which it involves". (emphasis in original) The Federal Constitutional Court537 of Germany has defined the principle in similar terms538. The three sub-principles, or tests, of the principle of proportionality are: (1) suitability, (2) necessity and (3) proportionality in the strict sense. The principle applied by the European Court of Justice ("the ECJ") is substantially drawn from German law539, although it may not be applied in the same way and the sub-principles may not be differentiated to the same degree540. Its principal application by the ECJ is in the sphere of freedom of economic activity541, where the second sub-principle assumes particular importance. 535 Schwarze, European Administrative Law, rev ed (2006) at 687. 536 This is further clarified in Schwarze, European Administrative Law, rev ed (2006) at 687, where it says that it is not the method used which has to be necessary, but "the excessive restriction of freedom involved in the choice of method". 537 Bundesverfassungsgericht. 538 In the decision published in vol 48 at 402, it was said that "[t]he intervention must be suitable and necessary for the achievement of its objective. It may not impose excessive burdens on the individual concerned, and must consequently be reasonable in its effect on him": see Schwarze, European Administrative Law, rev ed (2006) at 687. 539 As to its sources see Schwarze, European Administrative Law, rev ed (2006) at 540 Schwarze, European Administrative Law, rev ed (2006) at 855. 541 Schwarze, European Administrative Law, rev ed (2006) at 773. The first of the three sub-principles, suitability, looks to the probable effectiveness of the legislative measure and unsuitability is rarely established542. Another word for suitability might be "adapted"543, as earlier mentioned in connection with the phrase "reasonably appropriate and adapted"544. The test of reasonable necessity is the test more often applied by the ECJ in relation to cases involving measures which restrict the freedom of movement of goods. In a leading case, it was held that the objective of protecting consumers could have been achieved by a measure which meant a less drastic restriction of the free movement of goods545. An analogy with the test confirmed in Betfair, and in Lange, can be drawn. And it is pointed out that necessity does not involve only the fact that there may be a choice of alternative means, as that would deny legislative choice. The other measure has to be equally effective546. It is said that the sub-principle of proportionality in the strict sense is applied in a negative manner and that this serves to restrict its operation. A legislative measure will be held invalid only where it is unnecessarily harmful to the interest protected by the Constitution and is "manifestly disproportionate"547. How this is applied in particular cases may serve to further illuminate what is meant by that term. For present purposes, it may be observed that it is not dissimilar to statements made in Davis and Nationwide News, where the effects of the legislative measures on the relevant freedoms were said themselves to be too severe to qualify as proportionate. As may be expected of an enquiry of this kind, factors such as the extent or severity of the restrictions effected by the legislative measures on the freedoms, or protected interests, and the objective pursued by the legislation, have been considered relevant in decisions of the ECJ and of the Federal 542 Emiliou, The Principle of Proportionality in European Law, (1996) at 26, 29. 543 Currie, The Constitution of the Federal Republic of Germany, (1994) at 20. 544 See [435] above. 545 Rewe-Zentral AG v Bundesmonopolverwaltung für Branntwein (Case 120/78) ("the Cassis de Dijon Case") [1979] 1 ECR 649. References to "less drastic means" are also found in United States constitutional jurisprudence: see "Less Drastic Means and the First Amendment", (1969) 78 Yale Law Journal 464. 546 Emiliou, The Principle of Proportionality in European Law, (1996) at 30. 547 Emiliou, The Principle of Proportionality in European Law, (1996) at 36, 268. Constitutional Court548. The latter Court requires that the seriousness of the effect of the legislative restriction, and the importance of the reasons said to justify it, be in adequate proportion to each other549. Much is said to depend upon the nature of the legislative provision and the sphere of protection of the freedom or interest involved550. It has also been the concern of the High Court to assess the effect of the legislative measures in question, in relation to either or both of the legislative objective and the freedom protected. Less attention has been directed to the identification of the aspect of the freedom which is the subject of the protection. A freedom protected by the Constitution is generally assumed to have a status such that a significant reason is required to be given for any serious restriction of it. Roach did not concern a protected freedom, but rather a basal concept which informs the Constitution. It was that concept which was said to be relevant to an assessment of proportionality. Lange and Roach At issue in Lange was the effect of the defamation law of New South Wales on the freedom of political communication. It will be recalled that two conditions were said to be necessary if a freedom was not to invalidate a law affecting it. The first was that the object of the law had to be compatible with the maintenance of the system of representative government. The second was that the law had to be reasonably appropriate and adapted to achieve its legitimate object or end551. Later in its reasons, the Court posed two questions as the test for whether a law impermissibly infringes upon freedom of communication. The first was whether the law had the effect of burdening the freedom. The second was expressed in the language of proportionality552: 548 Tridimas, "Proportionality in European Community Law: Searching for the Appropriate Standard of Scrutiny", in Ellis (ed), The Principle of Proportionality in the Laws of Europe, (1999) 65 at 76-77; Schwarze, European Administrative Law, rev ed (2006) at 688. 549 Schwarze, European Administrative Law, rev ed (2006) at 688. 550 Emiliou, The Principle of Proportionality in European Law, (1996) at 32. 551 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562. 552 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567. "Second, if the law effectively burdens that freedom, is the law reasonably appropriate and adapted to serve a legitimate end the fulfilment of which is compatible with the [system of government prescribed by the Constitution]". It may be observed that the question appears to combine the two conditions earlier stated. The law's purpose (the "legitimate end") is that which is compatible with the maintenance of the prescribed system of government. The question is whether the law is reasonably appropriate and adapted to serve that end. So understood, the test may involve whether the operation and effect of the law's measures are reasonably necessary to that legitimate purpose. Indeed this is the approach which was taken. In Lange the Court examined the common law rules of defamation in New South Wales by reference to whether there were other, less drastic measures by which the objectives of the law could be achieved, following the approach thought to have been taken by the majority in ACTV553. The Court was able to conclude that the law went no further than was necessary, for the protection of reputation, given the extended application of the law of qualified privilege554. It did so by adapting the constitutionally guaranteed freedom. the recognition of to accommodate that law A distinctive feature of Lange, so far as concerns tests of proportionality, is that the Court was able to achieve proportionality through its approach to the common law. By this means, it was able to conclude that proportionality existed based upon the test of reasonable necessity and was not required to undertake the task of assessing the extent of the effect of the defamation laws upon the freedom, as had been undertaken in some of the earlier cases involved with restrictions upon freedom of political communication. McHugh J in Coleman v Power555 considered that the fact that the Court in Lange adopted the example of ACTV was important to understanding what was intended by the second limb of the test in Lange. This must be accepted. His Honour's interpretation of what was said about ACTV led his Honour to conclude further that the test in Lange was intended to include, not only the compatibility of the law's objective, but also the compatibility of the measures undertaken to achieve the law's objective, with the prescribed system of government556. A 553 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568. 554 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 575. 555 (2004) 220 CLR 1 at 50-51 [93]-[94]; [2004] HCA 39. 556 Coleman v Power (2004) 220 CLR 1 at 50-51 [94]; and see at 78 [196] per Gummow and Hayne JJ, 82 [213] per Kirby J. relationship between legislative measures and the maintenance of the prescribed system of government is somewhat different from the relationship involved in tests of proportionality employed in previous cases. It is not obvious that the decision in Lange was reached by an assessment involving that relationship. Nevertheless, the relationship appears to have assumed importance in Roach. The essential difficulty with the legislative disqualification in Roach, identified in the majority judgments, was that there was no evident reason or purpose beyond the obvious intention to remove a prisoner's ability to vote. It was arbitrary and did not differentiate between serious and other offences557. It may not be thought that much more was required for a finding that the law was disproportionate. Indeed, in the joint judgment it was said that what can be seen to be "disproportionate or arbitrary" may not meet the requirement that it be "reasonably appropriate and adapted for an end consistent or compatible with observance of the relevant constitutional restraint upon legislative power."558 That constitutional restraint is identified in connection with the test of proportionality, as being what is necessary to the maintenance of the prescribed system of representative government. The disqualification in question in Roach was compared, in the joint judgment, with another provided by the Electoral Act which, however, was considered to be valid. That provision disentitled persons who were incapable of understanding the nature and significance of voting, because they were of unsound mind. Although it limited the exercise of the franchise, it was held to do "for an end apt to protect the integrity of the electoral process. That end, plainly enough, is consistent and compatible with the maintenance of the system of representative government." The effect of the disqualification in Roach, on the other hand, was "further to stigmatise" prisoners by denying them the exercise of the franchise560. In the discussion which followed, it was pointed out that the disqualification operated 557 Roach v Electoral Commissioner (2007) 233 CLR 162 at 182 [23]-[24] per Gleeson CJ, 200 [90], 201 [93] per Gummow, Kirby and Crennan JJ. 558 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85] per Gummow, 559 Roach v Electoral Commissioner (2007) 233 CLR 162 at 200 [88] per Gummow, 560 Roach v Electoral Commissioner (2007) 233 CLR 162 at 200 [89] per Gummow, without regard to the nature of the offence committed, the length of the term of the imprisonment, sentencing policy and the offender's personal circumstances561. It was concluded that562: "The legislative pursuit of an end which stigmatises offenders by imposing a civil disability during any term of imprisonment takes s 93(8AA) beyond what is reasonably appropriate and adapted (or 'proportionate') to the maintenance of representative government. The net of disqualification is cast too wide". The last sentence in this passage reflects a view of the excessive effect of the legislative provision. It is difficult to see how it could be otherwise, absent a reason for complete disqualification. This might suffice for a conclusion that it was disproportionate. However, it was obviously considered necessary to further test proportionality. In doing so, the relationship which was identified as relevant was as between the effects of the legislative measure; namely, the further stigma of disqualification, and the "maintenance of the system of representative government". The identification of a system as the interest which is the subject of constitutional protection might raise questions about how legislative effects upon it are to be assessed, not the least because it is a concept, the essential features of which are difficult to isolate. However, the joint judgment in Roach further particularised voting as the feature with which it was concerned. It was said that voting in elections lies at the very heart of the system of government for which the Constitution provides563. The effect of disqualification from it was therefore serious and no reason was given to explain this legislative choice. It is of interest to observe that in Roach the disqualification which had been effected under the previous legislation was held to be valid. It disenfranchised prisoners who were serving sentences of three years or more. This was considered to be explicable. It reflected one electoral cycle, which had customarily formed a basis for a disqualification564, and it could be seen to 561 Roach v Electoral Commissioner (2007) 233 CLR 162 at 200-201 [90]-[93] per Gummow, Kirby and Crennan JJ. 562 Roach v Electoral Commissioner (2007) 233 CLR 162 at 202 [95] per Gummow, 563 Roach v Electoral Commissioner (2007) 233 CLR 162 at 198 [81] per Gummow, 564 Roach v Electoral Commissioner (2007) 233 CLR 162 at 203 [98] per Gummow, distinguish between serious lawlessness and less serious, yet reprehensible, conduct565. The earlier legislation could have permitted proportionality to be tested by reference to alternative, but less restrictive, measures, but it does not appear to have been approached in this way. Nevertheless, that test is one upon which the plaintiffs here rely. Proportionality applied: the plaintiffs' case The plaintiffs' challenge, at its first level, was said to draw upon Roach. It was that the provisions did not serve any legitimate end. There was no need for the provisions, because no problem had been identified by the AEC with respect to the integrity of the Electoral Rolls. This may raise a threshold question, rather than one involving any proportionality as between the legislation and its purpose. The submission overlooks the terms of the AEC's advice to the JSCEM for the purpose of its report, in 2002, on the integrity of the Electoral Roll566, namely: "With the system we have – a compulsory enrolment system – it is as open as possible, but we have never said it is not possible to defraud the system. We have always said that it has not occurred in a systematic way." The JSCEM on that occasion recommended that the AEC should further address "this potential risk to the electoral system."567 Further, the submission does not take account of the other reason given by the JSCEM for a shortening of the "period of grace". It was said that it was necessary to obtain greater compliance with enrolment obligations, not just at the time when elections were called but also in the period between elections. The JSCEM considered that the "period of grace" worked against such an objective and encouraged people to leave enrolment to the last moment. 565 Roach v Electoral Commissioner (2007) 233 CLR 162 at 204 [102] per Gummow, 566 Joint Standing Committee on Electoral Matters, The Integrity of the Electoral Roll: Review of ANAO Report No 42 2001-02, Integrity of the Electoral Roll, (2002) at 567 Joint Standing Committee on Electoral Matters, The Integrity of the Electoral Roll: Review of ANAO Report No 42 2001-02, Integrity of the Electoral Roll, (2002) at It cannot be suggested that the measures in question are without justification, in contrast to the disqualification in Roach. Both objects are not only compatible with the maintenance of an orderly and effective system of voting, as an aspect of the system of representative government, they are important to it. The principal object seeks to ensure greater compliance with electoral obligations. The point made by the plaintiffs in reply is relevant to proportionality. It was put that, accepting that there may be some concerns of the kind mentioned, less restrictive means could have been adopted to address them. Thus, the test of reasonable necessity, as assessed by alternative practicable means, is raised, as it was in Lange. Such a test assumes that the measures are sufficiently restrictive to warrant a search for alternative means. This is a matter which will require separate consideration. It was not suggested by the plaintiffs that the Electoral Act should make provision for persons to enrol or transfer enrolment at all times up to polling. Nor was it suggested that the legislation should provide that the AEC should undertake enrolments itself, which has been mooted elsewhere. The plaintiffs' case was that they should have been allowed to have their claims considered at any time during the seven days prior to closure of the Rolls, as the Act had permitted prior to the 2006 amendments. It is not sufficient, for this test of proportionality, that an alternative legislative measure be identified. The Court must be able to conclude that that alternative measure is just as effective for the legislative purpose as the measures employed. Such a conclusion is not possible here. There is nothing to suggest that allowing the longer period before the close of Rolls would be just as effective for the purpose of encouraging compliance with enrolment obligations and, therefore, nothing upon which to conclude that the opinion of the JSCEM was wrong. Attention is then directed to a consideration of the effects of the legislative measures – in the first place, in connection with the pursuit of the objectives of the legislation and, in the second, by reference to the interest identified in Roach as subject to constitutional protection. It is necessary, in this regard, to bear in mind that it is the effects of the legislation which are relevant, not a view of their importance to the electoral system, about which different views have been held. It must first be observed that what is restricted by the legislative measure is an entitlement to enrol, not an entitlement to vote. Nevertheless, voting is only possible upon enrolment and it must therefore be accepted that a possible effect of the measure is that a person's ability to vote at a particular election may be lost. But the effect is only possible and the loss is temporary. No issue is taken by the plaintiffs with the aspect of the scheme of the Electoral Act which obliges enrolment and renders it an offence to fail to do so. The provisions in question do not themselves operate to render a person unable to vote. What is necessary to bring about that result is the failure of a person to fulfil his or her obligations within a specified period, when fulfilment is not attended by any obvious difficulty. It would be a curious application of a test of proportionality if a law, otherwise valid, was invalid because Parliament should recognise that people will not fulfil their statutory obligations. It is of interest to observe that the ECJ is said to be loath to apply the principle of proportionality when it is invoked in an attempt to justify a failure to comply with Community law568. The denial of enrolment and voting for an election, for a legitimate reason, does not intrude too far upon the system of voting. It is, and has always been, a part of that system. It reinforces the requirement that persons qualified to vote enrol in a timely way, which is conducive to the effective working of the system. No denial of the franchise is involved. It is not possible, logically, for the plaintiffs to suggest that these provisions are incompatible, but those allowing for a few more days for enrolment are not. Conclusion For these reasons I did not join in the orders made on 6 August 2010. I would have dismissed the proceedings with costs. 568 Tridimas, "Proportionality in European Community Law: Searching for the Appropriate Standard of Scrutiny", in Ellis (ed), The Principle of Proportionality in the Laws of Europe, (1999) 65 at 66.
HIGH COURT OF AUSTRALIA IN THE MATTER OF QUESTIONS REFERRED TO THE COURT OF DISPUTED RETURNS PURSUANT TO SECTION 376 OF THE COMMONWEALTH ELECTORAL ACT 1918 (CTH) CONCERNING Re Culleton [No 2] [2017] HCA 4 3 February 2017 ORDER The questions referred to the Court of Disputed Returns by the President of the Senate in his letter dated 8 November 2016, as amended by orders made by French CJ on 21 November 2016, be answered as follows: Question (a) Whether, by reason of s 44(ii) of the Constitution, there is a vacancy in the representation of Western Australia in the Senate for the place for which Senator Rodney Norman Culleton was returned? Answer By reason of s 44(ii) of the Constitution, there is a vacancy in the representation of Western Australia in the Senate for the place for which Senator Rodney Norman Culleton was returned. Question (b) If the answer to Question (a) is "yes", by what means and in what manner that vacancy should be filled? Answer The vacancy should be filled by a special count of the ballot papers. Any directions necessary to give effect to the conduct of the special count should be made by a single Justice. Question (c) What directions and other orders, if any, should the Court make in order to hear and finally dispose of this reference? Answer Unnecessary to answer. Question (d) What, if any, orders should be made as to the costs of these proceedings? Answer Senator Culleton's costs of the proceedings should be paid by the Commonwealth save for costs excluded from this order by an order of a Judge. Representation P E King with P W Lithgow appearing on behalf of Senator Rodney Norman Culleton (instructed by Maitland Lawyers) N J Williams SC with C L Lenehan and B K Lim appearing on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Re Culleton [No 2] Parliamentary elections (Cth) – Senate – Reference to Court of Disputed Returns – Where at date of nomination person convicted of offence punishable by term of imprisonment for one year or longer – Where person liable to be sentenced – Where person elected as Senator – Where conviction subsequently annulled – Whether annulment of conviction of retrospective effect – Whether person incapable of being chosen as Senator under s 44(ii) of Constitution – Whether vacancy should be filled by special count of ballot papers. Words and phrases – "annulment", "convicted and is under sentence, or subject to be sentenced", "incapable of being chosen", "retrospective effect", "special count", "void ab initio". Constitution, s 44(ii). Commonwealth Electoral Act 1918 (Cth), ss 364, 376. Crimes Act 1900 (NSW), s 117. Crimes (Appeal and Review) Act 2001 (NSW), ss 4, 8, 9, 10. Crimes (Sentencing Procedure) Act 1999 (NSW), ss 10, 25. KIEFEL, BELL, GAGELER AND KEANE JJ. Constitution relevantly provides: Section 44(ii) of the "Any person who: (ii) … has been convicted and is under sentence, or subject to be sentenced, for any offence punishable under the law of the Commonwealth or of a State by imprisonment for one year or longer … shall be incapable of being chosen or of sitting as a senator ...". On the return of the writ for the election of Senators for the State of Western Australia in 2016, Rodney Norman Culleton was noted as elected and he has since sat as a Senator. On 2 March 2016, prior to his nomination for election and before polling day for the election, Senator Culleton was convicted, in his absence, in the Local Court of New South Wales, of the offence of larceny. He was then liable to be sentenced to imprisonment for a maximum term of two years1 when he was brought before that Court2. The Local Court subsequently granted an annulment of the conviction3, proceeded to deal with the matter afresh4, found Senator Culleton guilty of the offence, on his own plea, but dismissed the charge without proceeding to conviction5. The President of the Senate has referred to this Court, in its capacity as the Court of Disputed Returns, a question6 whether, by virtue of s 44(ii) of the Constitution, there is a vacancy in the representation of Western Australia in the Senate for the place for which Senator Culleton was returned. In the 1 Crimes Act 1900 (NSW), s 117; Criminal Procedure Act 1986 (NSW), s 268(1A). 2 Crimes (Sentencing Procedure) Act 1999 (NSW), s 25(1) and (2). 3 Crimes (Appeal and Review) Act 2001 (NSW), s 8. 4 Crimes (Appeal and Review) Act 2001 (NSW), s 9(2). 5 Crimes (Sentencing Procedure) Act 1999 (NSW), s 10(1)(a). 6 Commonwealth Electoral Act 1918 (Cth), s 376. Bell circumstances outlined above, the issue is whether Senator Culleton's conviction had the effect of disqualifying him from being elected as a Senator. In the reasons which follow, it will be explained that Senator Culleton was a person who had been convicted and was subject to be sentenced for an offence punishable by imprisonment for one year or longer at the date of the 2016 election. That was so, both as a matter of fact and as a matter of law. The subsequent annulment of the conviction had no effect on that state of affairs. It follows from s 44(ii) that Senator Culleton was "incapable of being chosen" as a Senator. In the result, there is a vacancy in the representation of Western Australia in the Senate for the place for which Senator Culleton was returned. The circumstances which gave rise to the reference On 2 March 2016 Senator Culleton was convicted, in his absence, in the Local Court of New South Wales at Armidale of the offence of larceny. The larceny was committed on 11 April 2014. Under s 117 of the Crimes Act 1900 (NSW) ("the Crimes Act"), the offence of larceny is punishable by imprisonment for a period of up to five years; but where the value of the property in respect of which the offence is charged does not exceed $5,000, the maximum term of imprisonment that the Local Court may impose is two years7. The offence of which Senator Culleton was convicted concerned property of a value less than $2,000. Accordingly, he was liable to imprisonment for a maximum term of two years. Under s 25(1)(a) of the Crimes (Sentencing Procedure) Act 1999 (NSW) ("the CSP Act"), a sentence of imprisonment may not be imposed upon an "absent offender"8. Section 25(2) of the CSP Act provides that the Local Court may issue a warrant for the offender's arrest for the purpose of having the offender brought before the Local Court for sentencing. Such a warrant may issue at any time after the Local Court convicts an absent offender for an offence. On 2 March 2016, the Local Court, having convicted Senator Culleton of larceny, issued a warrant for his arrest in order to have him brought to the Court for sentencing. On 16 May 2016, the Deputy of his Excellency the Governor of Western Australia caused a writ to be issued for the election of 12 Senators for the State to serve in the Senate of the Parliament of the Commonwealth. Rodney Norman 7 Criminal Procedure Act 1986 (NSW), s 268(1) and (1A), Sched 1, Table 2, item 3. 8 Defined in Crimes (Sentencing Procedure) Act 1999 (NSW), s 25(4). Bell Culleton was nominated as a candidate in a group nomination for Pauline Hanson's One Nation party. Polling day for the election was 2 July 2016. On 2 August 2016, the Australian Electoral Officer for the State of Western Australia returned the writ for the election certifying the names of the 12 Senators elected, in order of their election. Senator Culleton was noted as elected in the 11th place. In accordance with s 7 of the Constitution, the Governor of Western Australia certified to the Governor-General the names of the chosen Senators. The warrant issued by the Local Court on 2 March 2016 was executed on 8 August 2016, on which date the Local Court granted an annulment of Senator Culleton's conviction pursuant to s 8 of the Crimes (Appeal and Review) Act 2001 (NSW) ("the Appeal and Review Act"). On 25 October 2016, the Local Court found Senator Culleton guilty of an offence against s 117 of the Crimes Act on his own plea but, pursuant to s 10(1)(a) of the CSP Act, without proceeding to conviction, dismissed the charge. Section 10(2) provides that the Court may make such an order if it is satisfied that it is inexpedient to inflict any punishment on the person, or that it is expedient to release the person on a good behaviour bond. Senator Culleton was ordered to pay compensation in the sum of $322.85 to the complainant. The reference The question identified at the outset of these reasons was referred to the Court by the President of the Senate by letter dated 8 November 2016 addressed to the Chief Executive and Principal Registrar of the Court. An affirmative answer to that question gives rise to a further question as to how that vacancy should be filled. Questions were also referred as to what directions should be made by the Court in order to hear and finally dispose of the reference, and as to what orders should be made as to the costs of these proceedings. The jurisdiction of this Court to entertain the reference from the Senate was not in question in the hearing before this Court9. By orders made on 21 November 2016, French CJ made directions for the reference to be referred to a Full Court for hearing in the December sittings of the Court. At the hearing of this matter, submissions were made on behalf of the Attorney-General of the Commonwealth in favour of an affirmative answer to the 9 See In re Wood (1988) 167 CLR 145 at 157-162; [1988] HCA 22. Bell question of whether there is a vacancy in the Senate. Senator Culleton was represented in the proceedings and made submissions in favour of a negative answer to the principal question. The Commonwealth agreed to pay Senator Culleton's costs of the proceedings in this Court in any event. Incapable of being chosen? In Sykes v Cleary10, it was held that the words "shall be incapable of being chosen" in s 44 refer to the process of being chosen: a process which operates from the date of nominations, as that is the date on which the electoral process begins, until the return of the writs for the election, as that is the time at which the electoral process is complete. No question arises in this case as to the temporal operation of s 44(ii). If Senator Culleton was incapable of being chosen by reason of the circumstances which gave rise to the reference to this Court, that disability persisted during the whole of the period from the time of nomination to the return of the writs for the election. A broad submission was advanced on behalf of the Attorney-General to the effect that the mere fact of the conviction, pursuant to which Senator Culleton was liable to be sentenced to a term of imprisonment of one year or longer, which was current at the date of the election, was sufficient to engage the disqualifying effect of s 44(ii) of the Constitution, even if the conviction were to be nullified retrospectively. The Attorney-General also advanced a narrower submission to the effect that the annulment effected under the Appeal and Review Act on 8 August 2016 operated only prospectively and so the conviction was not avoided ab initio. Because the Attorney-General's narrower submission is correct, it is unnecessary to deal further with the broader submission. At the time at which the question as to Senator Culleton's eligibility to be chosen fell to be determined, he was, in fact, a person who had been "convicted and … subject to be sentenced". That was the case even though the point was not taken at the time by anyone with an interest in the question. Senator Culleton argues that even if he was, as a matter of fact, a person who had been "convicted and … subject to be sentenced" at the time of the election, he was not, as a matter of law, incapable of being chosen by the electorate by reason of s 44(ii). In this regard, three submissions were advanced on his behalf. The first was that he was not convicted and sentenced at any time during the electoral process. Secondly, it was said that he was not a person who was "convicted" within the meaning of s 44(ii) because his conviction was annulled with retrospective effect after the 10 (1992) 176 CLR 77 at 99-101, 108, 130, 132; [1992] HCA 60. Bell electoral choice of the people of Western Australia was made, so that in the eye of the law it did not exist at that time. Thirdly, it was said that he was not "subject to be sentenced ... for any offence punishable … by imprisonment" at any time during the electoral process. Not convicted and sentenced Counsel for Senator Culleton put at the forefront of his argument the submission that, because Senator Culleton had at no time actually been sentenced to imprisonment for the offence of larceny, s 44(ii) of the Constitution had no application to him. This submission was based upon a misunderstanding of what was said in Nile v Wood11. Further, the submission treats s 44(ii) as if the words "or subject to be sentenced", which appear after the words "and is under sentence", have no operation. In Nile v Wood, Brennan, Deane and Toohey JJ made it clear that a conviction alone is not sufficient to disqualify a candidate under s 44(ii). Their Honours said12: "It is not conviction of an offence per se of which s 44(ii) of the Constitution speaks. The disqualification operates on a person who has been convicted of an offence punishable by imprisonment for one year or more and is under sentence or subject to be sentenced for that offence. The references to conviction and sentence are clearly conjunctive … This is so as a matter of construction of the language used in s 44(ii)." The argument for Senator Culleton seized upon the sentence which followed in their Honours' reasons: "And it is apparent that it was the intention of the framers of the Constitution that the disqualification under this paragraph should operate only while the person was under sentence: see Quick & Garran, Annotated Constitution of the Australian Commonwealth (1901), pp 490, 492; Official Report of the National Australasian Convention Debates, 11 (1987) 167 CLR 133 at 139; [1987] HCA 62. 12 (1987) 167 CLR 133 at 139 (emphasis in original). Bell In Quick and Garran's The Annotated Constitution of the Australian Commonwealth13, the only relevant discussion of s 44(ii) proceeds under the rubric "Or has been Convicted, and is Under Sentence for any Offence". No mention is made of the additional words in s 44(ii) "or subject to be sentenced". The argument proceeds that because those words are not mentioned, either by Quick and Garran or in Nile v Wood, they are no more than a reiteration of the words "under sentence". It may be accepted that Quick and Garran's reference to s 44(ii) is not complete. That omission was not relevant to the decision in Nile v Wood, which concerned a deficiency in an election petition, in that it failed to allege that Senator Wood had been convicted of an offence punishable by imprisonment for one year or more and was under sentence for that offence. No question arose in that case about whether Senator Wood was "subject to be sentenced". It was not suggested by the Court in Nile v Wood that although s 44(ii) expressly refers to the case of a person who "has been convicted and is … subject to be sentenced", in truth it applies only to a person who "has been convicted and is under sentence". It is apparent from the passage from their Honours' reasons which is set out above that their Honours did not treat the words "subject to be sentenced" as simply a repetition of the words "is under sentence". Counsel for Senator Culleton was obliged to accept that, on his contention, "under sentence, or subject to be sentenced" in s 44(ii) should be read as meaning under sentence "or having been sentenced being subject to sentence". Section 44(ii) cannot sensibly be read in that way. It is evident from the terms of s 44(ii) that the framers of the Constitution were concerned to ensure that not only should a person who has already been sentenced to a term of imprisonment of one year or longer be disqualified from being chosen or from sitting as a Senator; so too should a person who is able to be so sentenced. The circumstance sought to be guarded against was that such a person might not be able to sit and should for that reason not be able to be chosen. The effect of the annulment Senator Culleton submitted that the effect of the annulment on 8 August 2016 was to render the conviction void ab initio, and restore the status quo ante. 13 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, Bell Senator Culleton made reference to the retrospective effect of annulment in other areas of the law. For example, in family law, the dissolution of a marriage involves the setting aside of the marriage prospectively, whereas the annulment of a marriage means that, in some respects, the marriage is treated as never having occurred14. The submissions made on behalf of Senator Culleton also adverted to dictionary meanings of the term "annulment", but those definitions indicate only that the term may refer to more than one effect. For example, in The Oxford Companion to Law15, it is said that "[i]f a judicial proceeding is annulled it is retrospectively or deprived of effect and prospectively." And in Sweet's A Dictionary of English Law16, it is said: inoperative, either rendered "To annul a judicial proceeding is to deprive it of its operation, either retrospectively or only as to future transactions. Thus, annulling an adjudication in bankruptcy puts an end to the proceedings, without invalidating any acts previously done by the trustee or the Court, and makes the property of the bankrupt revert to him, unless the Court otherwise orders." (footnote omitted) Whether an annulment operates retrospectively or prospectively inevitably depends upon the statutory context in which the term is used. The argument for Senator Culleton ignores the terms of the Appeal and Review Act as they inform the meaning of annulment in s 10(1) of that Act. Under the Appeal and Review Act, the Local Court is empowered to review certain of its own decisions. Section 4(1) contemplates the making of an "application for annulment" of a conviction made by the Local Court sitting at the place where the original Local Court proceedings were held. Under s 4(2)(a), such an application must be made within two years of the conviction being made: evidently, if such an application is not made within that period, the conviction may stand. Under s 8(2)(c), the Local Court must grant an annulment if it is satisfied that, "having regard to the circumstances of the case, it is in the interests of justice to do so." Section 9(2)(a) provides that if the decision is made to annul 14 Fowke v Fowke [1938] Ch 774 at 779. 15 Walker, The Oxford Companion to Law, (1980) at 66. 16 Sweet, A Dictionary of English Law, (1882) at 49. Bell the relevant conviction, the Local Court must "deal with the original matter afresh"; and s 9(3) provides that the Local Court "is to deal with the original matter as if no conviction … had been previously made". As McHugh J said in Re Macks; Ex parte Saint17, the phrase "as if" serves to introduce a fiction or a hypothetical contrast: "It deems something to be what it is not or compares it with what it is not." Section 9(3) thus requires the Local Court to proceed upon the fiction that a conviction has not been made, because, in truth, the conviction was not a nullity from the beginning. Section 10(1) of the Appeal and Review Act provides that "[o]n being annulled, a conviction … ceases to have effect and any enforcement action previously taken is to be reversed." This provision states the extent to which the annulment may affect the legal position established by the conviction. The annulment of the conviction was not apt to expunge the legal rights and obligations arising from it, save in relation to the future and in the reversal of things done under it. The provisions of the Appeal and Review Act to which reference has been made indicate that a conviction is annulled only for the future: these provisions do not purport to operate retroactively to deny legal effect to a conviction from the time that it was recorded. To say, as s 10(1) does, that the conviction "ceases to have effect" is to acknowledge that it has been in effect to that point18. Further, to say that "enforcement action … is to be reversed" is to leave the legal state of affairs previously established by the conviction unaffected, save for the actual reversal of any action taken by way of enforcement against the defendant. One may illustrate this point by hypothesising an action for malicious prosecution against the prosecutor. In an action for malicious prosecution, the plaintiff must ordinarily prove that the prosecution ended in his or her favour19. Speaking generally, this ingredient of the cause of action could not be established where a conviction was recorded20. Of course, in the present case, this element of the cause of action might not be established for that Senator Culleton was, by his own plea, ultimately shown to be guilty of the the further reason 17 (2000) 204 CLR 158 at 203 [115]; [2000] HCA 62. 18 See Attorney-General (Q) v Australian Industrial Relations Commission (2002) 213 CLR 485 at 493 [12], 505 [53]; [2002] HCA 42. 19 Basebé v Matthews (1867) LR 2 CP 684; Davis v Gell (1924) 35 CLR 275 at 289; [1924] HCA 56; Stimac v Nicol [1942] VLR 66. 20 Everett v Ribbands [1952] 2 QB 198 at 200, 201-202, 206. Bell offence charged. But the point for present purposes is that, at the date of the 2016 election, the conviction recorded against Senator Culleton was legally in effect and that position was not altered by the annulment because the effect of s 10 is that an annulment under the Appeal and Review Act does not purport retrospectively to treat the conviction as if it had never occurred. This case presents another example of what Windeyer J described in Cobiac v Liddy21 when he said that, by the exercise of a power to set aside a conviction, "the court holds that the accused was not lawfully convicted and that the conviction ought not to stand, not that there never was in fact a conviction." rely upon this Court's decision Commissioner for Railways (NSW) v Cavanough22, where it was said that if a conviction is set aside on appeal, the conviction is void ab initio and the holder of an office "cannot be deemed to have vacated his office" by reason of the conviction. However, that case was concerned with the effect of an order made upon an appeal, setting aside a conviction which was deemed to have the effect of vacating an office of employment. It has nothing to say about the operation of an annulment of a conviction under the Appeal and Review Act. In the course of argument, counsel for Senator Culleton also adverted to the possibility that the original conviction had been procured by procedural unfairness or fraud or other circumstances which would warrant the conclusion that it was always and entirely a legal nullity. The factual basis for such an argument was not established. In addition, these possibilities are not consistent with the circumstance that Senator Culleton sought and obtained relief under the Appeal and Review Act on the basis that the conviction of 2 March 2016 was truly a conviction. Subject to be sentenced for any offence punishable by imprisonment Senator Culleton submitted that, even if the annulment did not operate retrospectively, he was not "subject to be sentenced ... for any offence punishable … by imprisonment for one year or longer" at the time of the 2016 election. On behalf of Senator Culleton, it was argued that because Senator Culleton was convicted in absentia, the effect of s 25(1)(a) of the CSP Act was that the Local Court could not make an order imposing a sentence of imprisonment on him because he was an "absent offender". 21 (1969) 119 CLR 257 at 272; [1969] HCA 26. 22 (1935) 53 CLR 220 at 224; [1935] HCA 45. Bell The argument advanced on Senator Culleton's behalf proceeds on the erroneous assumption that because Senator Culleton was convicted in his absence, he acquired the status of an absent offender, an incident of which status was immunity from imprisonment. This argument cannot be accepted. Section 25(4) of the CSP Act provides that in s 25, the term "absent offender" means "an offender who is being dealt with in his or her absence." The use of the present tense indicates that whether or not a person is an absent offender for the purposes of s 25(1)(a) depends on whether the person is absent when being dealt with by the court. Whether or not Senator Culleton was, at any time, an absent offender depended on whether the court was dealing with him in his absence. Once he was present in court, whether in answer to the warrant issued for that purpose or otherwise, he was no longer an absent offender, and a punishment of imprisonment might lawfully be imposed on him. While Senator Culleton was not liable to be sentenced to imprisonment in his absence immediately upon the conviction being recorded on 2 March 2016, once the warrant issued on that day for his arrest, the processes of the law pursuant to which he might lawfully be sentenced to imprisonment were set in train. If those processes took their course, he would be present when sentenced, and so might lawfully be sentenced to a term of imprisonment without offending s 25(1)(a) of the CSP Act. It is not correct to say that at the time of the 2016 election he was not "subject to be sentenced". Section 364 Senator Culleton relied on s 364 of the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act"), which provides that the Court of Disputed Returns, on a reference from the President of the Senate23, "shall be guided by the substantial merits and good conscience of each case without regard to legal forms or technicalities". He sought to argue that, by reason of the delay attending the reference and the circumstance that his conviction was a matter of public record, "good conscience" required that this Court decline to answer the question as to whether his seat was vacant. This Court is obliged by s 376 of the Electoral Act to determine the matter referred to it. Section 364 does not provide any basis for avoiding that 23 See Commonwealth Electoral Act 1918 (Cth), ss 377, 381. Bell obligation. It is a procedural provision which, as was said in Sue v Hill24 by Gleeson CJ, Gummow and Hayne JJ, does "not exonerate the Court from the application of substantive rules of law". In the same case, McHugh J described25 s 364 as "ancillary" to the specific powers conferred by the Electoral Act to allow an election to be set aside. The consequences of a vacancy The conclusion that Senator Culleton was incapable of being chosen raises for determination by this Court the question as to the order which should be made to fill the resulting vacancy in the Senate. The Attorney-General submitted that, if this Court were to hold that Senator Culleton was disqualified from being chosen by reason of s 44(ii) of the Constitution, the vacancy should be filled by a special count of the ballot papers and that any directions necessary to give effect to the conduct of the special count should be made by a single Justice. The Attorney-General submitted that this Court, on the hearing of a reference under Pt XXII of the Electoral Act, has the power to "declare any candidate duly elected who was not returned as elected"26, and that that power carries with it an incidental power to order a special count27. Senator Culleton did not contest the submissions put on behalf of the Attorney-General upon this question. It is not necessary to order the taking of a further poll, whether for the unfilled place in the Senate or for all 12 Senators for Western Australia. It was said by this Court in In re Wood28 that "an election is not avoided if an unqualified candidate stands" because if it were otherwise "the nomination of unqualified candidates would play havoc with the electoral process". There is no suggestion that the presence of Senator Culleton's name on the ballot paper has 24 (1999) 199 CLR 462 at 485 [42]; [1999] HCA 30. 25 Sue v Hill (1999) 199 CLR 462 at 548 [224]. 26 Commonwealth Electoral Act 1918 (Cth), s 360(1)(vi); see also s 379. 27 In re Wood (1988) 167 CLR 145 at 172. 28 (1988) 167 CLR 145 at 167. Bell falsified the declared choice of the people of the State for any of the other 11 candidates who were declared to be elected. There is no reason to suppose that a special count would "result in a distortion of the voters' real intentions"29, rather than a reflection of "the true legal intent of the voters so far as it is consistent with the Constitution and [the Electoral Act]"30. Since Senator Culleton was incapable of being chosen as a Senator for Western Australia, the votes actually cast in favour of the party of which he was an endorsed candidate should be counted in favour of the next candidate on that list, at least so far as votes "above the line" for Pauline Hanson's One Nation party are concerned. There is no reason to suppose that the votes cast "above the line" in favour of that group were not intended to flow to the next individual nominee of Pauline Hanson's One Nation party in the event that Senator Culleton was not capable of being elected. The evidence established that 96.04 per cent of the votes received by Senator Culleton were votes for Pauline Hanson's One Nation party. A special count would not distort the true legal intent of the voters. Conclusion The questions referred to the Court were31: (a) whether, by reason of s 44(ii) of the Constitution, there is a vacancy in the representation of Western Australia in the Senate for the place for which Senator Rodney Norman Culleton was returned; if the answer to Question (a) is "yes", by what means and in what manner that vacancy should be filled; (c) what directions and other orders, if any, should the Court make in order to hear and finally dispose of this reference; and (d) what, if any, orders should be made as to the costs of these proceedings. 29 Sykes v Cleary (1992) 176 CLR 77 at 102; Free v Kelly (1996) 185 CLR 296 at 302-304; [1996] HCA 42. 30 In re Wood (1988) 167 CLR 145 at 166. 31 Question (a) was amended by orders made by French CJ on 21 November 2016. Bell These questions should be answered as follows: By reason of s 44(ii) of the Constitution, there is a vacancy in the representation of Western Australia in the Senate for the place for which Senator Rodney Norman Culleton was returned. The vacancy should be filled by a special count of the ballot papers. Any directions necessary to give effect to the conduct of the special count should be made by a single Justice. (c) Unnecessary to answer. Senator Culleton's costs of the proceedings should be paid by the Commonwealth save for costs excluded from this order by an order of a Judge. Nettle NETTLE J. I agree with the plurality that the questions referred to the Court in its capacity as the Court of Disputed Returns should be answered as they propose. My reasons, however, are in some respects different from theirs. Relevant constitutional and other legislative provisions Section 44 of the Constitution relevantly provides: "Disqualification Any person who: is under any acknowledgment of allegiance, obedience, or adherence to a foreign power, or is a subject or a citizen or entitled to the rights or privileges of a subject or a citizen of a foreign power; or is attainted of treason, or has been convicted and is under sentence, or subject to be sentenced, for any offence punishable under the law of the Commonwealth or of a State by imprisonment for one year or longer; or (iii) is an undischarged bankrupt or insolvent; or holds any office of profit under the Crown, or any pension payable during the pleasure of the Crown out of any of the revenues of the Commonwealth; or has any direct or indirect pecuniary interest in any agreement with the Public Service of the Commonwealth otherwise than as a member and in common with the other members of an incorporated company consisting of more than twenty-five persons; shall be incapable of being chosen or of sitting as a senator or a member of the House of Representatives." Section 4 of the Crimes (Appeal and Review) Act 2001 (NSW) ("the Appeal and Review Act") relevantly provides that, if a defendant has been convicted of an offence by the Local Court32 in circumstances where the defendant was not in appearance before the court when the conviction was made, 32 See Crimes (Appeal and Review) Act 2001 (NSW), s 3(1) definition of "Local Court". Nettle the defendant may apply within two years thereafter for an annulment of his or her conviction. Section 8(2) of the Appeal and Review Act relevantly provides that the Local Court must grant such an application for annulment if satisfied that the defendant was not aware of the original Local Court proceedings until after they were completed; the defendant was hindered by accident, illness, misadventure or other cause from taking action in relation to the proceedings; or, having regard to the circumstances of the case, it is in the interests of justice to do so. Section 9 of the Appeal and Review Act relevantly provides that, if the Local Court decides to annul a conviction, it must deal with the original matter afresh (either immediately or at a later date), and that, in doing so, it is to deal with the matter "as if no conviction ... had been previously made". Section 10(1) of the Appeal and Review Act relevantly provides that, "[o]n being annulled, a conviction ... ceases to have effect". The point in time to which s 44 of the Constitution is directed As was established in Sykes v Cleary33, the words "shall be incapable of being chosen" which appear at the conclusion of the above quoted text of s 44 of the Constitution "refer to the process of being chosen, of which nomination is an essential part". Hence, as Brennan CJ later observed in Free v Kelly34, if a candidate for election is not qualified for election at the time of nomination, he or she is incapable of being chosen. In the present case it is unnecessary to reconsider the significance, for the purpose of s 44, of other dates, such as the polling day and the day the poll is declared35. As is recorded in the statement of facts in the plurality's reasons in this case, at the date of his nomination, Mr Culleton stood convicted of larceny but he remained to be sentenced. The maximum penalty that the Local Court could impose on Mr Culleton was two years' imprisonment or 20 penalty units or 33 (1992) 176 CLR 77 at 100 per Mason CJ, Toohey and McHugh JJ (Brennan J agreeing at 108, Dawson J agreeing at 130, Gaudron J agreeing at 132); [1992] HCA 60. 34 (1996) 185 CLR 296 at 301; [1996] HCA 42. 35 See Sykes v Cleary (1992) 176 CLR 77 at 99-101 per Mason CJ, Toohey and McHugh JJ (Brennan J agreeing at 108, Dawson J agreeing at 130, Gaudron J agreeing at 132), cf at 120-125 per Deane J. Nettle both36. Consequently, looking at the matter as at the date of nomination, it appears that Mr Culleton was, by reason of his conviction and the operation of s 44(ii) of the Constitution, incapable of being chosen as a senator. Mr Culleton disputes that he was "subject to be sentenced" within the meaning of s 44(ii) of the Constitution. As will be explained later in these reasons, however, that objection is misconceived. The real question is whether, in view of the subsequent annulment of Mr Culleton's conviction, he should now be regarded as having been capable of being chosen as a senator at the date of his nomination. More precisely, was the effect of the annulment that, for the purposes of s 44(ii) of the Constitution, it is as if there never were a conviction? Or does the annulment mean only that, although the conviction ceased to exist upon annulment, it must still be regarded for the purposes of s 44(ii) of the Constitution as having been in existence at the date of nomination? That depends as much on the correct construction of s 44(ii) of the Constitution as upon the meaning of ss 4, 8, 9 and 10 of the Appeal and Review Act. The correct construction of s 44(ii) of the Constitution There are two ways in which s 44(ii) of the Constitution might conceivably be construed. One is to read s 44(ii) as applying to the fact of a conviction, and so to a conviction regardless of whether it is subsequently annulled  whether prospectively or retrospectively  pursuant to provisions like those of the Appeal and Review Act. The other is to construe s 44(ii) as applying only to a conviction that is not subsequently annulled. The better view is that s 44(ii) is directed to a conviction in fact regardless of whether it is subsequently annulled. Historically, that accords with the circumstance that at the time of Federation, and until each Australian jurisdiction adopted legislation modelled on the Criminal Appeal Act 1907 (UK), there were only very limited mechanisms for annulment of conviction and appeal against conviction37. Thus, for the framers of the Constitution, a conviction in fact was, and by and large would remain, a conviction. Furthermore, at the time of 36 Crimes Act 1900 (NSW), s 117 read with Criminal Procedure Act 1986 (NSW), s 268, Sched 1, Table 2, Pt 2, item 3. 37 See Conway v The Queen (2002) 209 CLR 203 at 208-216 [7]-[25] per Gaudron ACJ, McHugh, Hayne and Callinan JJ; [2002] HCA 2; R v Gee (2003) 212 CLR 230 at 261 [88] per Kirby J; [2003] HCA 12; Woods, A History of Criminal Law in New South Wales: The Colonial Period, 1788-1900, (2002) at 253-255, 325; Mildren, The Appellate Jurisdiction of the Courts in Australia, (2015) at 1-3; McClellan and Beshara, A Matter of Fact: The Origins and History of the NSW Court of Criminal Appeal, (2013) at 3-5. Nettle Federation, colonial and imperial legislation required a candidate to be nominated by a specified number of electors38; and, although, as was observed in Sykes v Cleary39, electoral statutes have only so much to say about constitutional provisions like s 44, the framers of the Constitution may be presumed to have been well aware of such requirements. Similar provision was later made in the Commonwealth Electoral Act 1902 (Cth)40 and continues today41, albeit side by side with an alternative procedure42. There is no room in requirements of that kind for contingent qualification. They demand certainty that, at the date of nomination, a nominee is capable of being chosen. Their existence at the time of the Constitution's framing is consistent with the conclusion that the framers intended no less. Equally, although the Constitution is not limited in its application to what existed at the time of Federation and is to be construed according to the "continued life and progress of the community"43, nothing has occurred since Federation that suggests that the current denotation44 or current understanding of 38 See Constitution Act Amendment Act 1890 (Vic), s 220 (re-enacting Electoral Act 1865 (Vic), s 83); Parliamentary Electorates and Elections Act 1893 (NSW), s 65(II); Electoral Code 1896 (SA), s 95; Electoral Act 1896 (Tas), s 89; Electoral Act 1899 (WA), s 81. 39 (1992) 176 CLR 77 at 100-101 per Mason CJ, Toohey and McHugh JJ (Brennan J agreeing at 108, Dawson J agreeing at 130, Gaudron J agreeing at 132), 124-125 40 See, originally, Commonwealth Electoral Act 1902 (Cth), s 99(b). See also Commonwealth Electoral Act 1918 (Cth), s 71(b) (as made). 41 Commonwealth Electoral Act 1918, s 166(1)(b)(i). 42 Commonwealth Electoral Act 1918, s 166(1)(b)(ii). 43 The Commonwealth v Kreglinger & Fernau Ltd and Bardsley (1926) 37 CLR 393 at 413 per Isaacs J; [1926] HCA 8. 44 Ex parte Professional Engineers' Association (1959) 107 CLR 208 at 267 per Windeyer J; [1959] HCA 47; R v Federal Court of Australia; Ex parte WA National Football League (1979) 143 CLR 190 at 233-234 per Mason J; [1979] HCA 6; Street v Queensland Bar Association (1989) 168 CLR 461 at 537-538 per Dawson J; [1989] HCA 53. See Stellios, Zines's The High Court and the Constitution, 6th ed (2015) at 23-31. Nettle the concept45 of s 44(ii) is any different from what it would have been at the time of Federation. Now, as at the time of Federation, the need for certainty in the electoral process makes it highly desirable that, if a person is convicted of a relevant offence, he or she should forthwith cease to be eligible for election, or, if already elected, should cease to be capable of sitting, until and unless the conviction is quashed or annulled or the sentence is spent46. If it were otherwise, there could be long periods following conviction of a relevant offence until an appeal or application for annulment is finally heard and determined in which it would be impossible to say whether the person so convicted is or is not eligible to be elected, or is or is not eligible to continue to sit as a senator or member of the House of Representatives. If the framers of the Constitution had foreseen that a process of annulment might bring about that possibility it is inherently unlikely that they would have intended that to be the result. The disqualification imposed by s 44(ii) must be read in light of the system of representative and responsible government established by the text and structure of the Constitution47. An understanding of s 44(ii) as requiring order and certainty in the electoral process accords with that system48. The effect of annulment In case that were not so, it was contended on behalf of the Attorney- General of the Commonwealth that the effect of s 10(1) of the Appeal and Review Act is wholly prospective and, therefore, that, at the date of his nomination, Mr Culleton was convicted both in fact and for all legal purposes. In the Attorney's submission, that is the necessary consequence of s 10(1) conditioning the decretal clause "a conviction ... ceases to have effect" on the anterior temporal clause "[o]n being annulled". It was also said to be consistent 45 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 552 [43] per McHugh J; [1999] HCA 27. 46 Cf Attorney-General v Jones [2000] QB 66 at 74. 47 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 557-559; [1997] HCA 25. 48 See and compare Sykes v Cleary (1992) 176 CLR 77 at 100 per Mason CJ, Toohey and McHugh JJ (Brennan J agreeing at 108, Dawson J agreeing at 130, Gaudron J agreeing at 132); Murphy v Electoral Commissioner (2016) 90 ALJR 1027 at 1040 [41] per French CJ and Bell J, 1045 [73]-[74] per Kiefel J, 1050 [104] per Gageler J, 1059-1060 [184]-[185] per Keane J, 1071-1072 [250] per Nettle J, 1083 [326] per Gordon J; 334 ALR 369 at 382-383, 390, 397, 409-410, 425-426, 440; [2016] HCA 36. Nettle with and confirmed by the requirement imposed by s 9(3) that, where a conviction is annulled, the Local Court is to deal with the original matter as if no conviction had been previously made. In the Attorney's submission, the words "as if no conviction ... had been previously made" signify a statutory fiction49 and, according to the principle that a statutory deeming provision is to be construed narrowly to achieve the object of its enactment50, the annulment is retrospective solely for the purpose of Local Court procedure with which s 9 is concerned. There is no room for any further degree of retrospectivity. Those submissions should not be accepted in the unqualified terms in which they were stated. Although the expressions "[o]n being annulled" and "ceases to have effect" connote a sense of prospectiveness, it is apparent that the provision is retrospective in at least one sense. If it were not, a person whose conviction has been annulled would continue to be classified as a person who has been convicted for the purposes of assessing the person's convict status in future. The preferable view is that, despite a conviction ceasing to have effect only upon annulment, the annulment has retrospective operation to the extent that a person's convict status in relation to events occurring after annulment is that he or she is not to be regarded as having been convicted. Hence, if nomination in this case had not occurred until after the annulment of Mr Culleton's conviction, he would have had the capacity to nominate even if, at the date of his nomination, the charge of larceny remained pending. In the terms of s 9(3), it would be "as if no conviction ... had been previously made". It should be accepted, however, that, since the necessary implication of a conviction ceasing to have effect upon annulment is that the conviction continues to have effect until and unless it is annulled, a conviction that is susceptible to annulment under the Appeal and Review Act continues to have effect up to the date of annulment51. It should also be accepted that, since a conviction that is susceptible to annulment under the Appeal and Review Act continues to have 49 See and compare Re Macks; Ex parte Saint (2000) 204 CLR 158 at 203 [115] per McHugh J; [2000] HCA 62; Loizos v Carlton and United Breweries Ltd (1994) 94 NTR 31 at 32 per Kearney J. See generally Hunter Douglas Australia Pty Ltd v Perma Blinds (1970) 122 CLR 49 at 65-67 per Windeyer J; [1970] HCA 63. 50 Muller v Dalgety & Co Ltd (1909) 9 CLR 693 at 696 per Griffith CJ; [1909] HCA 67; Wellington Capital Ltd v Australian Securities and Investments Commission (2014) 254 CLR 288 at 314 [51] per Gageler J; [2014] HCA 43; Commissioner of Taxation v Comber (1986) 10 FCR 88 at 96 per Fisher J; Martinez v Minister for Immigration and Citizenship (2009) 177 FCR 337 at 348 [29]. 51 See and compare Cobiac v Liddy (1969) 119 CLR 257 at 272 per Windeyer J; [1969] HCA 26. Nettle effect up to the date of annulment, it remains determinative of the convicted person's convict status in relation to events occurring up to that point. In that respect, an analogy may be drawn to a marriage that was susceptible to annulment under s 21 of the now repealed Matrimonial Causes Act 1959 (Cth). Such a marriage was voidable52 as opposed to void53 and so, until and unless the marriage had been annulled, it operated as a valid marriage determinative of the marital status of the parties. Neither party to the marriage was free to re-marry before the marriage was annulled, and, if either did so, it appears that the purported re-marriage was and remained a bigamous marriage54 notwithstanding the subsequent annulment of the prior marriage. Logically, it is the same here. Up to the point of its annulment, Mr Culleton's conviction was voidable, not void. Consequently, until it was annulled, it remained a valid conviction determinative of his convict status for the purposes of s 44(ii). It follows that, at the time of his nomination, he was not capable of being chosen as a senator, notwithstanding the later annulment of his conviction. Subject to be sentenced It remains to deal with Mr Culleton's contention that he was not "subject to be sentenced" at the date of nomination. The essence of the argument was that s 44(ii) operates only if and after a sentence of more than 12 months' imprisonment has been imposed and that, because Mr Culleton was not sentenced until after he was elected, he was capable of nominating and being elected. Counsel for Mr Culleton stated that the argument was based on the following observation of Brennan, Deane and Toohey JJ in Nile v Wood55: "it is apparent that it was the intention of the framers of the Constitution that the disqualification under [s 44(ii)] should operate only while the person was under sentence: see Quick & Garran, Annotated Constitution of the Australian Commonwealth (1901), pp 490, 492". The argument is unsound. As closer attention to Nile v Wood reveals, the statement that it was intended that the disqualification should operate "only while the person was under sentence" was calculated in context to convey that the disqualification was intended to operate only while the person is under sentence 52 Matrimonial Causes Act 1959 (Cth), s 51(1). 53 Cf Matrimonial Causes Act, s 18(1). 54 See and compare R v Jacobs (1826) 1 Mood 140 [168 ER 1217]; Fowke v Fowke [1938] Ch 774 at 779; R v Gould [1968] 2 QB 65 at 70. 55 (1987) 167 CLR 133 at 139; [1987] HCA 62. Nettle or subject to sentence. So much is apparent from the statement, only a few lines before the cited passage, that56: "[t]he disqualification operates on a person who has been convicted of an offence punishable by imprisonment for one year or more and is under sentence or subject to be sentenced for that offence". It is also confirmed by one of the passages from Quick and Garran to which their Honours referred, which relevantly is as follows57: "Attainder or Conviction.—In the Commonwealth Bill of 1891, the provision was that a person 'attainted of treason, or convicted of felony or any infamous crime' should be incapable 'until the disability is removed by ... the expiration or remission of the sentence, or a pardon, or release, or otherwise.' In Committee, Mr Wrixon objected to the express provision that an ex-convict might be a member of Parliament, and proposed to make the disqualification permanent; but this was negatived by 27 votes to 9. At the Sydney session, 1897, Mr Barton mentioned a suggestion by Sir Samuel Griffith to substitute more precise terms for 'felony or other infamous crime.' Accordingly at the Melbourne session, before the first report and after the fourth report, the provision was altered to its present form." (ellipsis in original, references to Convention Debates omitted) Plainly, the purpose of s 44(ii) was to disqualify a person convicted of any offence for which the maximum penalty is a term of imprisonment of one year or more if the person either has been sentenced and is still to complete the sentence, and so is "under sentence", or remains to be sentenced, and so is "subject to be sentenced". Section 364 of the Commonwealth Electoral Act 1918 (Cth) and the consequences of a vacancy Finally, I agree with the reasons of the plurality with respect to the operation of s 364 of the Commonwealth Electoral Act and also with respect to the consequences of a vacancy. Conclusion The questions should be answered as proposed by the plurality. 56 Nile v Wood (1987) 167 CLR 133 at 139 (emphasis omitted). 57 Quick and Garran, The Annotated Constitution of the Australian Commonwealth,
HIGH COURT OF AUSTRALIA TANIA ISBESTER AND APPELLANT KNOX CITY COUNCIL RESPONDENT Isbester v Knox City Council [2015] HCA 20 10 June 2015 ORDER Appeal allowed with costs. Set aside the order of the Court of Appeal of the Supreme Court of Victoria made on 10 September 2014 and, in its place, order that: the appeal be allowed with costs; and the order of the Supreme Court of Victoria made on 17 June 2014 be set aside and, in its place, order that: the decision of the defendant notified to the plaintiff by letter dated 15 October 2013 be quashed; and the defendant pay proceeding. the plaintiff's costs of the On appeal from the Supreme Court of Victoria Representation B R St. A Kendall QC with A S Felkel for the appellant (instructed by Phoenix Legal Solutions) S P Donaghue QC with R C Knowles for the respondent (instructed by Maddocks) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Isbester v Knox City Council Administrative law – Natural justice – Bias – Reasonable apprehension of bias – Incompatibility of roles – Where respondent made order under s 84P(e) of Domestic Animals Act 1994 (Vic) for destruction of appellant's dog – Where there was panel hearing and deliberation prior to decision being made – Where member of panel had been involved in prosecuting related criminal charges – Whether fair-minded observer might reasonably apprehend that panel member might not bring impartial mind to decision – Whether interest of panel member might affect decision-making of others on panel. Words and phrases – "conflict of interest", "incompatibility of roles". Domestic Animals Act 1994 (Vic), s 84P(e). KIEFEL, BELL, KEANE AND NETTLE JJ. Following a hearing before the Knox Domestic Animals Act Committee of the Knox City Council, a decision was made that a dog owned by the appellant, which had earlier been seized by the Council, be destroyed. Section 84P(e) of the Domestic Animals Act 1994 (Vic) ("the Act") provides the Council with the power to destroy a dog where its owner has been found guilty of an offence under s 29 of the Act. The appellant had been convicted of an offence under s 29(4), on her plea of guilty to the charge that on 4 August 2012 her Staffordshire terrier called "Izzy" had attacked a person and caused "serious injury". The issue on this appeal is whether that decision should be quashed because of the substantial involvement of a member of that Committee (referred to in the proceedings as "the Panel") both in the prosecution of charges concerning the dog and in the decision of the Panel as to the fate of the dog. Background facts Ms Kirsten Hughes was the Council's Co-ordinator of Local Laws. Part of her duties involved the regulation of domestic animals under the Act. In June 2013, the appellant was charged with a series of offences arising out of recent attacks by her three dogs. At this time it came to Ms Hughes' attention that the investigation of the August 2012 incident had not been completed. In the August 2012 incident, two of the appellant's dogs were involved in an attack upon another dog. A person who tried to pull one of the attacking dogs off the other dog sustained a wound to her finger. Ms Hughes directed Council employees to further investigate the identity of the dog involved in inflicting the injury on the person in that attack and she spoke with the complainant herself. She determined that six charges should be laid with respect to that attack, arranged for charges and summonses to be drafted and signed some of the charges, including that brought under s 29(4), as informant. Ms Hughes gave instructions to the Council's solicitors to prosecute the charges and to negotiate pleas which might be accepted from the appellant. Those pleas were entered in the Ringwood Magistrates' Court on 12 September An order for destruction of the dog under s 29(12) of the Act could have been, but was not, sought from the Magistrates' Court. It was the practice of the Council to itself convene a panel of its officers where it was necessary to consider cases of this kind. Ms Hughes decided that a hearing by the Panel should be held and made arrangements for that to occur. Bell Nettle The day following the hearing in the Magistrates' Court, a letter drafted by Ms Hughes was sent to the appellant. The letter advised the appellant that it was open to the Council to consider the destruction of her dog. The letter also advised that if an order for destruction was not made, the Council could declare her dog to be dangerous under s 34(1)(a) of the Act. Such a declaration would have the effect that the appellant's dog would be subject, in particular, to requirements as to the restraint of the dog within and without her property (ss 38 and 41). The appellant was further informed that a hearing by the Panel would be held on 30 September 2013 and that the Panel would consist of three Council officers "who will consider all the information prior to making any decision." The chairperson was to be the person delegated to make the decision; the second Panel member was to be Ms Hughes and the third was to be an officer of the Council "who has not had any involvement in the matters, to provide assistance in the decision making process." The letter went on to say that "[t]he officer involved in the investigation may be present but they will not be involved in the decision making." If that advice was intended to suggest that Ms Hughes would not participate in the decision-making process, it was incorrect. It may be that it was intended to refer to Mr Martonyi, who was the investigator subject to Ms Hughes' direction. The appellant was invited to and did attend, provided evidence and made submissions to the Panel. The Panel comprised Mr Angelo Kourambas, Director of City Development; Mr Steven Dickson, Manager of City Safety and Health, who was the chairperson; and Ms Hughes. Each of the Panel members held a delegation from the Council for the purposes of s 84P of the Act. In preparation for the hearing, Ms Hughes made enquiries of the Department of Human Services as to whether the appellant's dog could return to the house which the appellant occupied, in the event that the dog was released. The other members of the Panel were also provided with other materials. They included the briefs of evidence which had been prepared for the Magistrates' Court hearing concerning the attacks in both 2012 and 2013, and Ms Hughes' notes of the hearing in the Magistrates' Court on 12 September 2013, which included comments made by the Magistrate which were adverse to the appellant. At the conclusion of the Panel's hearing the appellant was informed by Mr Dickson that the Panel would make a decision and she would be notified of it. It is not disputed that Ms Hughes participated fully in the decision-making process of the Panel following the hearing. She agreed in cross-examination that she played a major role in that process. After a detailed discussion between the Panel members, Ms Hughes said, Mr Kourambas provided the instruction that the Bell Nettle dog should be destroyed and she proceeded to draft reasons for his approval and signature. The appellant was notified of the decision by a letter dated 15 October The decisions of the Courts below The appellant, unsuccessfully, sought judicial review of the Council's decision and orders in the nature of certiorari and prohibition under O 56 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic). A number of grounds were relied upon for the orders sought. Only the ground that relied upon an apprehension of possible bias on the part of Ms Hughes remains relevant to this appeal and then only in one respect. The primary judge (Emerton J) identified1 the relevant principle for apprehended bias to be that stated in Ebner v Official Trustee in Bankruptcy2, where it was said that "a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide". Her Honour then referred to what had been said in Minister for Immigration and Multicultural Affairs v Jia Legeng3, namely that the application of that principle will not be the same for a decision-maker who is not a judicial officer. What is required in relation to apprehended bias by prejudgment, her Honour said, depends on the circumstances4. Her Honour the primary judge considered5 that the requirement for impartiality exists to the extent necessary to give persons affected by a decision under s 84P(e) a genuine hearing. Her Honour referred in this respect to statements in McGovern v Ku-ring-gai Council6 concerning the expectations of decision-making by a local council: Isbester v Knox City Council [2014] VSC 286 at [84]. (2000) 205 CLR 337 at 344 [6]; [2000] HCA 63. (2001) 205 CLR 507 at 563 [181]; [2001] HCA 17. Isbester v Knox City Council [2014] VSC 286 at [85]. Isbester v Knox City Council [2014] VSC 286 at [110]. (2008) 72 NSWLR 504 at 519 [80] per Basten JA. Bell Nettle "The real question is what, with the appropriate level of appreciation of the institution, the fair-minded observer would expect of a councillor dealing with a development application. The institutional setting being quite different from that of a court, the fair-minded observer will expect little more than an absence of personal interest in the decision and a willingness to give genuine and appropriate consideration to the application, the matters required by law to be taken into account and any recommendation of council officers." The Court of Appeal of the Supreme Court of Victoria (Hansen and Osborn JJA and Garde AJA) accepted that the essential requirements of natural justice were those as identified by the primary judge7. It will be necessary to refer to the circumstances of McGovern's case later in these reasons. Her Honour the primary judge considered that the requirement that there be an absence of personal interest in the decision and a willingness to give genuine and appropriate consideration to the appellant's submissions could be satisfied even where a decision-maker has been involved in the earlier prosecution. A fair-minded observer would not apprehend that there might be a disqualifying predisposition from this fact alone8. The appeal to the Court of Appeal was limited to the ground of apprehended bias. The Court approached that ground on two bases, found that neither was made out and dismissed the appellant's appeal. The Court of Appeal considered the question whether there was a possibility that Ms Hughes could have prejudged the decision under s 84P(e) separately from the question whether her involvement in the prosecution of the charges against the appellant could give rise to an apprehension of conflict of interest. This approach may have been influenced by the reasons of Spigelman CJ in McGovern, where his Honour distinguished between these two categories of bias on the basis that they required a different kind of analysis9. On this appeal the appellant does not argue for a finding of prejudgment. Only the question of Ms Hughes' possible conflict of interest remains relevant. Isbester v Knox City Council [2014] VSCA 214 at [48], [65], [69]. Isbester v Knox City Council [2014] VSC 286 at [111]. 9 McGovern v Ku-ring-gai Council (2008) 72 NSWLR 504 at 509-510 [25]-[27]. Bell Nettle The Court of Appeal concluded10 that the case did not involve a conflict of interest such as was evident in Stollery v Greyhound Racing Control Board11 and Dickason v Edwards12. In these cases it had been held that a person who is in the position of an accuser cannot also hear and decide the charge in conjunction with other people. The Court of Appeal agreed with the primary judge that this case was distinguishable from Stollery and it did so on three bases13: (1) the Panel hearing was not a quasi-judicial hearing of the type required to be conducted by the Board in Stollery; (2) although Ms Hughes had been in the position of accuser in the Magistrates' Court, she was not in that position at the Panel's hearing; and (3) Ms Hughes had no special or personal interest in the matters in controversy, as had existed in Stollery and Dickason. None of the circumstances in issue involved her personally. It remains to mention an aspect of the reasoning of the Court of Appeal which is the subject of an application by the Council for leave to file a notice of contention. Her Honour the primary judge14 accepted that Ms Hughes participated in every aspect of the Panel decision and that, given her experience and knowledge of the relevant legislation, her views would carry considerable weight. However, her Honour found that the relevant decision to destroy the dog was made by Mr Kourambas, the delegate for this purpose, not the other members of the Panel. The Court of Appeal accepted15 that the facts found by her Honour may be relevant to the question whether Mr Kourambas had prejudged the matter, but did not16 base its decision as to the perceived conflict of interest arising from Ms Hughes' involvement in the matter on the fact that she was not the designated decision-maker. It accepted that she had a material part in the decision-making process. Before this Court, the Council sought to contend that, given the finding 10 Isbester v Knox City Council [2014] VSCA 214 at [69], [78]-[80]. 11 (1972) 128 CLR 509; [1972] HCA 53. 12 (1910) 10 CLR 243; [1910] HCA 7. 13 Isbester v Knox City Council [2014] VSCA 214 at [78]-[80]. 14 Isbester v Knox City Council [2014] VSC 286 at [103]-[105]. 15 Isbester v Knox City Council [2014] VSCA 214 at [65]. 16 Isbester v Knox City Council [2014] VSCA 214 at [68]. Bell Nettle of the primary judge, the Court of Appeal should have found a fair-minded observer would not reasonably apprehend bias on the part of Mr Kourambas. How the governing principle is to be applied The question whether a fair-minded lay observer might reasonably apprehend a lack of impartiality with respect to the decision to be made is largely a factual one, albeit one which it is necessary to consider in the legal, statutory and factual contexts in which the decision is made. The principle governing cases of possible bias was said in Ebner17 to require two steps to be taken in its application. The first requires the identification of what it is said might lead a decision-maker to decide a case other than on its legal and factual merits. Where it is said that a decision-maker has an "interest" in litigation, the nature of that interest must be spelled out. The second requires the articulation of the logical connection between that interest and the feared deviation from the course of deciding the case on its merits. As Hayne J observed in Jia Legeng18, essentially the fear that is expressed in an assertion of apprehended bias, whatever its source, is of a deviation from the true course of decision-making. It was observed in Ebner19 that the governing principle has been applied not only to the judicial system but also, by extension, to many other kinds of decision-making and decision-makers. It was accepted that the application of the principle to decision-makers other than judges must necessarily recognise and accommodate differences between court proceedings and other kinds of decision- making. The analogy with the curial process is less apposite the further divergence there is from the judicial paradigm20. The content of the test for the decision in question may be different21. 17 (2000) 205 CLR 337 at 345 [8]. 18 (2001) 205 CLR 507 at 563 [183]. 19 (2000) 205 CLR 337 at 343-344 [4]. 20 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 21 Hot Holdings Pty Ltd v Creasy (2002) 210 CLR 438 at 460 [70]; [2002] HCA 51. Bell Nettle How the principle respecting apprehension of bias is applied may be said generally to depend upon the nature of the decision and its statutory context, what is involved in making the decision and the identity of the decision-maker. The principle is an aspect of wider principles of natural justice, which have been regarded as having a flexible quality, differing according to the circumstances in which a power is exercised22. The hypothetical fair-minded observer assessing possible bias is to be taken to be aware of the nature of the decision and the context in which it was made23 as well as to have knowledge of the circumstances leading to the decision24. The two cases referred to in the Courts below, Jia Legeng and McGovern, furnish examples of how the above-mentioned factors assume relevance to the question of what a fair-minded observer may reasonably expect as to the level, or standard, of impartiality which should be brought to decision-making by certain non-judicial decision-makers. Whether those factors assume particular relevance to a case such as the present, where the essential question concerns incompatibility of roles, or a conflict of interest, is another question. In Jia Legeng, the context for the Minister's decision was a statute providing a particular power in the exercise of which it was necessary to consider the national interest. The decision had a political quality and rendered the Minister subject to a particular kind of accountability unlike that to which a judge would be subjected. It was observed that a person in the position of the Minister may not be as constrained in the wide range of factors to be taken into account and in receiving opinions from a number of sources25. It would be artificial, in a decision-making process of this kind, to require the Minister to exercise his power so as to avoid acting in a way that would, in the case of a judge, create the appearance of bias26. The same level of evident neutrality as applies to a judge could not be required of a person in the Minister's position. 22 Kioa v West (1985) 159 CLR 550 at 612; [1985] HCA 81. 23 Hot Holdings Pty Ltd v Creasy (2002) 210 CLR 438 at 459 [68]. 24 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 519. 25 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at 562 [179], 565 [187] per Hayne J. 26 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR Bell Nettle In McGovern, a local council approved an application for consent to further develop a residential property, over the objections of the applicant's neighbours. Prior to voting on the matter, two councillors had come to the view that the application should be approved and they had expressed their view in strong terms on more than one occasion. It was considered by Spigelman CJ in McGovern27 to be of particular significance that the relevant statutory power was vested in a democratically elected council exercising a discretionary power expressed in broad terms to which multiple considerations applied and in respect of which there might be a range of permissible opinion. At a practical level, it is also to be expected that a person in the position of a councillor will form opinions before voting and may express them. As was observed28 in Jia Legeng, it would be unrealistic to expect a political decision-maker to modify his or her behaviour in order to conform to higher standards inappropriate to his or her office. It could not be suggested that a councillor who has expressed views to constituents with respect to a development application should disqualify himself or herself. It was in this context that Basten JA said, in the passage quoted by the primary judge in this case and set out above, that a fair-minded observer would expect little more of a councillor than an absence of personal interest and a willingness to give genuine and appropriate consideration to the application. At issue in Jia Legeng and in McGovern was the possibility of bias in the nature of prejudgment on the part of the relevant decision-makers. Neither case had the feature concerning the decision-maker present in this case and they consequently did not address the question whether a person's involvement in the matter antecedent to the decision is incompatible with his or her participation in the decision. The application of the principle in this case The discretionary powers of the Council under the Act with respect to dogs are broad, consistently with their protective purpose. The question for the Council, and its delegates, in exercising the power under s 84P(e) involves the safety of the public. Matters relevant to the decision would include a dog's propensity for attacking dogs and persons and whether measures other than 27 (2008) 72 NSWLR 504 at 508 [13]. 28 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR Bell Nettle destruction could be taken without exposing the public to an unacceptable risk of harm, for example whether the animal could be effectively restrained. A decision under s 84P(e) affects the owner of the dog. Whether one describes an interest in a dog as a property right, or acknowledges the importance of a domestic pet to many people, the appellant is a person who may be affected by a decision which will require her interests to be subordinated to the public interest. It is therefore understandable that the Council has accepted throughout these proceedings that a decision under s 84P(e) requires compliance with the requirements of natural justice. In its argument, the Council was concerned to make the point that it was not required to provide a hearing of the kind undertaken nor convene a panel to make the decision under s 84P(e). The point may be made in aid of the submission, reiterated at various points in the Council's argument, that the constitution of the Panel to hear the matter did not make the process quasi- judicial in nature. The process could therefore be distinguished from the processes undertaken in cases such as Dickason and Stollery. Describing a process as having, or not having, a quasi-judicial quality is rarely helpful29. In a case such as this it diverts attention from the real question, which is directed to the impartiality of the decision-maker, given her particular involvement in the matter. It may be accepted that there is no statutory requirement for a hearing or for a panel in connection with a decision under s 84P(e). The Council or a delegate could themselves decide the matter, subject to the requirements of natural justice. However, it is not to be inferred from the fact that the Council could decide the matter for itself that the standard of neutrality referred to in McGovern, that of merely genuine and appropriate consideration, is relevant to, or determinative of, this case. At issue in McGovern were allegations of prejudgment. The question raised concerning the impartiality of the two councillors was whether they could be expected to give genuine consideration to the application, given the opinions they had expressed. The concern as to the impartiality of Ms Hughes raises a different question. There is no issue before this Court concerning her possible prejudgment of the matter. The question here is whether it might reasonably be 29 Salemi v MacKellar [No 2] (1977) 137 CLR 396 at 419 per Gibbs J; [1977] HCA Bell Nettle apprehended that a person in her position would have an interest in the decision which could affect her proper decision-making. The interest which the appellant alleges existed in this case is akin to that which a person bringing charges, whether as a prosecutor or other accuser, might be expected to have in the outcome of the hearing of those charges. It is generally expected that a person in this position may have an interest which would conflict with the objectivity required of a person deciding the charges and any consequential matters, whether that person be a judge or a member of some other decision-making body. In Dickason30, Isaacs J referred to cases of this kind as instances of "incompatibility". The plaintiff in Dickason was a member of a friendly society regulated by statute. He was accused of insulting the District Chief Ranger of the society. It was held that the District Chief Ranger could not sit as part of the committee to hear the charges brought against the plaintiff. Isaacs J31 said that, subject to a statute providing otherwise and the principle of necessity32, "[i]f it is incompatible for the same man to be at once judge and occupy some other position which he really has in the case, then prima facie he must not act as a judge at all." O'Connor J33 thought that it would be impossible not to reasonably suspect a man who is a prosecutor in a charge concerning himself of bias. Stollery is a case not unlike Dickason. In Stollery, a greyhound owner was accused by the manager of an association which conducted dog racing of attempting to bribe the manager. The manager reported the incident in question to the Greyhound Racing Control Board, which then held an inquiry. The manager himself was a member of the Board. Although he took no part in the deliberations, he remained present in the room whilst they were taking place. The decision of the Board was quashed by this Court. In Stollery, Menzies J referred34 to a long line of authority which establishes that a tribunal decision will be invalidated if "there is present some 30 (1910) 10 CLR 243 at 259. 31 Dickason v Edwards (1910) 10 CLR 243 at 259. 32 Recognised in Dimes v Proprietors of the Grand Junction Canal (1852) 3 HLC 759 33 Dickason v Edwards (1910) 10 CLR 243 at 257. 34 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 520. Bell Nettle person who, in fairness, ought not to be there". In the view of Barwick CJ35, the manager was personally involved as he was in the position of an accuser. Gibbs J took a similar view36. It was contrary to the rules of natural justice, his Honour held37, for an accuser to be present as a member of a tribunal hearing the charge he promoted. Their Honours held that the manager's mere presence was sufficient to invalidate the decision, either because he was an influential person38 or because his presence might inhibit and affect the deliberations of others39. The joint reasons in Ebner40 gave as an example of the prohibition on a judicial officer hearing a case the circumstance where that person is a member of a body which instituted the prosecution. In doing so, the reasons also referred to authority, including Dickason, which suggests that the application of the prohibition was not considered to be limited only to judicial officers. Ms Hughes' position with respect to the charges in the Magistrates' Court is analogous to the positions of the moving parties in Dickason and Stollery. It can scarcely be doubted that she had a similar interest in the outcome of the charges. However, neither of those cases addressed the issue behind the question which arises here, on the Council's case, as to whether it could reasonably be apprehended that Ms Hughes also maintained an interest in the outcome of the decision under s 84P(e). The Council places considerable reliance upon the fact that the decision- making process took place in two stages. The charges were heard, and pleas taken, in the Magistrates' Court. The Council, through the Panel, dealt with the subsequent but separate issue as to the fate of the dog. Ms Hughes' interest, if any, as a prosecutor, on the Council's argument, ended when the proceedings in the Magistrates' Court came to an end. 35 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 516. 36 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 527. 37 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 526-527. 38 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 517 per 39 Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 527 per 40 (2000) 205 CLR 337 at 358 [59]-[61]. Bell Nettle It is true that the question for the Panel was different from that with which the Magistrates' Court was concerned, in the same way that a penalty proceeding may be regarded as different from that concerning the underlying offence. It may be accepted that different questions are raised in penalty proceedings. In the present case the questions for the Panel would include matters directed to the future, such as the dog's propensity to attack and the safety of the public. However, it is also to be expected that much of the evidence relating to the past offence will also be relevant to penalty and this was the case here. This explains why the briefs of evidence from the Magistrates' Court proceedings and Ms Hughes' notes of those proceedings were provided to the other Panel members. It is not realistic to view Ms Hughes' interest in the matter as coming to an end when the proceedings in the Magistrates' Court were completed. A line cannot be drawn at that point of her involvement so as to quarantine the Magistrates' Court proceedings from her actions as a member of the Panel. It is reasonably to be expected that her involvement in the prosecution of the charges created an interest in the final outcome of the matter. Ms Hughes' continuing interest in the matter may be tested by asking whether, if the Magistrates' Court had been asked to make an order for destruction, as could have been done following conviction, it might reasonably be apprehended that she would remain interested in whether the Magistrates' Court granted the order. The answer must clearly be "Yes". In any event, it is not accurate to describe Ms Hughes as a person who in fact had no ongoing involvement in advancing the matter after the Magistrates' Court proceedings. Having participated in obtaining the conviction for the offence under s 29(4), she organised the Panel hearing and drafted the letter advising the appellant of it. She supplied the Panel with evidence, including further evidence she had obtained as relevant to the future housing of the dog. If Ms Hughes could not actually be described as a prosecutor with respect to the decision under s 84P(e), she was certainly the moving force. That leaves for consideration the opinion of the Court of Appeal that the disqualifying interests in Dickason and Stollery were of a kind particularly personal to the persons in question and that such an element is absent in the case of Ms Hughes. It is true that Ms Hughes' role in this matter did not involve her at quite the same personal level as the manager in Stollery, who was subjected to, and affronted by, the alleged bribe; nor was she the target of abuse as in Dickason, which was directed to the District Chief Ranger. It may be accepted that these factors added another dimension to the level of involvement of those persons. It Bell Nettle cannot, however, be said that this dimension accounted for the disqualification in those cases. The interest identified in Dickason and Stollery as necessitating disqualification was that of a prosecutor, accuser or other moving party. An interest of that kind points to the possibility of a deviation from the true course of decision-making. A "personal interest" in this context is not the kind of interest by which a person will receive some material or other benefit. In the case of a prosecutor or other moving party it refers to a view which they may have of the matter, and which is in that sense personal to them. The interest of a prosecutor may be in the vindication of their opinion that an offence has occurred or that a particular penalty should be imposed, or in obtaining an outcome consonant with the prosecutor's view of guilt or punishment. It is not necessary to analyse the psychological processes to which a person in such a position is subject. It is well accepted, as the two cases referred to show, that it might reasonably be thought that the person's involvement in the capacity of prosecutor will not enable them to bring the requisite impartiality to decision-making. This is not to equate such a person with a judge. In that part of the joint reasons in Ebner which deals with the incompatibility of the interest of a prosecutor and judge, it is said that cases of incompatibility might have a special significance, and might operate independently of problems relating to apprehension of bias41. It may be inferred that their Honours were distinguishing cases of incompatibility from those where pecuniary interests are in question, because in the latter, difficult questions may sometimes arise as to whether the second step of the two-stage test in Ebner is satisfied. In cases of incompatibility, disqualification would seem to be the only possible outcome, because the second step will necessarily be satisfied. The Council submitted that the Court should not apply an automatic disqualification if it found that Ms Hughes' involvement gave her a relevant interest, and that the test in Ebner should be applied. It submitted that the test could not be met because (i) even if Ms Hughes had an interest, the primary judge had found as a fact that she did no more than diligently carry out her responsibility; and (ii) the decision was not made by her, but by her superior, Mr Kourambas. The first of these submissions might be relevant to an allegation of actual bias, but provides no answer to one of apprehended bias based on an interest in the decision. The second is relevant to the proposed notice of contention. For the reasons given in Dickason and Stollery, the participation of 41 Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 358 [59]. Bell Nettle others does not overcome the apprehension that Ms Hughes' interest in the outcome might affect not only her decision-making, but that of others. The Court of Appeal was correct to approach the question on the basis that she played a material part in the decision. That is so even if Mr Kourambas was responsible as delegate for the decision. The majority reasons in Ebner should not be understood to exclude cases of the kind here in question from the application of the principle by the test there stated. The test directs attention, as a first step in cases where apprehended bias is alleged, to the critical question of the decision-maker's interest. The difference in the application of the test is that in cases like the present one that concern incompatibility of roles, once the interest is identified as one which points to a conflict of interest, the connection between that interest and the possibility of deviation from proper decision-making is obvious. Conclusion and order A fair-minded observer might reasonably apprehend that Ms Hughes might not have brought an impartial mind to the decision under s 84P(e). This conclusion implies nothing about how Ms Hughes in fact approached the matter. It does not imply that she acted otherwise than diligently, and in accordance with her duties, as the primary judge found42, or that she was not in fact impartial. Natural justice required, however, that she not participate in the decision and because that occurred, the decision must be quashed. Leave to file the notice of contention should be refused. The appeal should be allowed with costs and the orders of the Court of Appeal set aside. In lieu thereof the orders of the Court of Appeal should read: appeal allowed with costs, the decision of the primary judge be set aside, the decision of the Council notified to the appellant by letter dated 15 October 2013 be quashed and there be an order for costs in favour of the appellant of the proceedings before the primary judge. The appellant does not suggest that the injunctions sought against the Council in the notice of appeal are necessary. 42 Isbester v Knox City Council [2014] VSC 286 at [115]. GAGELER J. The Domestic Animals Act 1994 (Vic) ("the Act") allows a municipal council to appoint an employee to be an "authorised officer"43. The resultant powers of the employee include to charge the owner of a dog with an offence relating to a dog attack under s 29 of the Act44 and to seize the dog if the owner is found by a court to be guilty of that offence45. If the owner is found by a court to be guilty of an offence under s 29 of the Act and if the dog is then seized, the municipal council itself has power under s 84P(e) of the Act to order that the dog be destroyed. The municipal council can delegate that power to an employee under the Local Government Act 1989 (Vic)46. There is no dispute that the power conferred by s 84P(e) of the Act is impliedly conditioned by the requirement that it can only be exercised as the result of a process which affords procedural fairness to the owner of the dog47. There is also no dispute that the standard incidents of procedural fairness are not displaced by the scheme of the Act. The standard incidents of procedural fairness, as it ordinarily conditions the exercise of a statutory power, include "the absence of the actuality or the appearance of disqualifying bias" in addition to "the according of an appropriate opportunity of being heard"48. The content of each of those incidents of procedural fairness accommodates to the particular statutory framework as well as to the particular factual context of a particular exercise of the power. The issue in this appeal relates to the content and application of the requirement of the absence of the appearance of disqualifying bias in the exercise of power under s 84P(e) of the Act. The test for the appearance of disqualifying bias in an administrative context has often been stated in terms drawn from the test for apprehended bias in a curial context. The test, as so stated, is whether a hypothetical fair-minded observer with knowledge of the statutory framework and factual context might reasonably apprehend that the administrator might not bring an impartial mind to 43 Section 72. 44 Section 92(b). 45 Section 81(2)(a). 46 Section 98. 47 Gubbins v Wyndham City Council (2004) 9 VR 620. 48 Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 367; [1990] HCA 33. the resolution of the question to be decided49. Such statements of the test have nevertheless been accompanied by acknowledgement that the application of this requirement of procedural fairness "must sometimes recognise and accommodate differences between court proceedings and other kinds of decision making"50. To accommodate to a multi-stage decision-making process, or a multi- member decision-making body, the test for the appearance of disqualifying bias in an administrative context might sometimes more usefully be stated in a form which focuses on the overall integrity of the decision-making process. The test in that alternative form might be stated as whether a hypothetical fair-minded observer with knowledge of the statutory framework and factual context might reasonably apprehend that the question to be decided might not be resolved as the result of a neutral evaluation of the merits. Neutrality in the evaluation of the merits cannot for the purpose of that or any other test be reduced to a monolithic standard; it necessarily refers to the "kind or degree of neutrality" that the hypothetical fair-minded observer would expect in the making of the particular decision within the particular statutory framework51. What must ultimately be involved is "an assessment (through the construct of the fair-minded observer) of the behaviour of a person or persons in a position to exercise power over another, and whether that other person was treated in a way that gave rise to the appearance of unfairness being present in the exercise of state power"52. Whether or not it might be useful to state the test in that alternative form, the test for the appearance of disqualifying bias in an administrative context is to be understood to mirror the test for apprehended bias in the curial context in two important respects. The first is that it is an "objective test of possibility, as distinct from probability"53. The second is that its application necessarily 49 Re Refugee Review Tribunal; Ex parte H (2001) 75 ALJR 982 at 989-990 [27]- [30]; 179 ALR 425 at 434-435; [2001] HCA 28; McGovern v Ku-ring-gai Council (2008) 72 NSWLR 504 at 507 [2], 516-517 [71]-[72], 553 [234]. 50 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at 538 [99]; [2001] HCA 17, citing Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 343-344 [4]; [2000] HCA 63. See also McGovern v Ku-ring-gai Council (2008) 72 NSWLR 504 at 507-508 [6]-[13]. 51 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at 564-565 [187], 566 [192]; see also at 538 [100]. 52 SZRUI v Minister for Immigration, Multicultural Affairs and Citizenship [2013] FCAFC 80 at [3]. 53 Re Refugee Review Tribunal; Ex parte H (2001) 75 ALJR 982 at 990 [28]; 179 ALR 425 at 435. involves three analytical steps. Step one is identification of the factor which it is hypothesised might cause a question to be resolved otherwise than as the result of a neutral evaluation of the merits. Step two is articulation of how the identified factor might cause that deviation from a neutral evaluation of the merits. Step three is consideration of the reasonableness of the apprehension of that deviation being caused by that factor in that way54. Where the factor identified at the first analytical step concerns one person who is a participant in a multi-stage decision-making process or in a multi- member decision-making body, the second analytical step can be seen to divide into two elements: articulation of how the identified factor might affect that person individually, and articulation of how that effect on that person individually might in turn affect the ultimate resolution of the question within the overall process of decision-making. It has accordingly been emphasised that, if an appearance of disqualifying bias is hypothesised to have resulted from conduct or circumstances of a person who is not the ultimate decision-maker, "then the part played by that other person in relation to the decision will be important"55. How a person who is individually affected might in turn affect the ultimate resolution of a question required to be resolved as the result of a neutral evaluation of the merits, however, remains always to be determined by reference to the objective possibilities which arise from the externally manifested facts. Although it necessarily involves a consideration of the significance of the role played by the person in the decision-making process, it necessarily involves no inquiry into the actual state of mind of that person or of any other person involved in the decision-making process. The touchstone throughout the relevant inquiry remains the appearance rather than the actuality of bias. That last point is well enough illustrated by an English case56, to which Barwick CJ drew attention in Stollery v Greyhound Racing Control Board57. There, a person who was a member of a firm of solicitors engaged by a party to a civil action relating to a motor vehicle collision also acted as a clerk to justices who convicted the other party in a criminal proceeding relating to the same collision. The conviction was set aside in circumstances where it was accepted that the person "retired in the usual way with the justices, taking with him the notes of the evidence in case the justices might desire to consult him", 54 Cf Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 345 [8]. 55 Hot Holdings Pty Ltd v Creasy (2002) 210 CLR 438 at 448 [22]; [2002] HCA 51. 56 R v Sussex Justices; Ex parte McCarthy [1924] 1 KB 256. 57 (1972) 128 CLR 509 at 518-519; [1972] HCA 53. notwithstanding that it was also accepted that "the justices came to a conclusion without consulting him, and that he scrupulously abstained from referring to the case in any way"58. There has been said to be a "general rule which is strictly applied that the same person cannot be accuser and judge … where … the principles of natural justice are required to be observed"59. The rule is best understood, at least in an administrative context, not as a free-standing rule of law but instead as referring to a factor the identification of which will almost inevitably give rise to a clear- cut application of the ordinary test for the appearance of disqualifying bias. Rarely could a fair-minded observer not think it appropriate to say of a person: "[i]f he is an accuser he must not be a judge"60. That is because a person who has been the adversary of another person in the same or related proceedings can ordinarily be expected to have developed in that role a frame of mind which is incompatible with required dispassionately to weigh legal, factual and policy considerations relevant to the making of a decision which has the potential adversely to affect interests of that other person. that degree of neutrality the exercise of The underlying concern was spelt out in the report which led in the United States to the introduction of the Administrative Procedure Act 1946 (US), which contains an express statement of a general proscriptive rule that no employee "engaged in the performance of investigative or prosecuting functions for any agency in any case shall, in that or a factually related case, participate or advise in the decision [or] recommended decision" of an agency undertaking an adjudication "except as witness or counsel in public proceedings"61. The report explained62: "Two characteristic tasks of a prosecutor are those of investigation and advocacy. It is clear that when a controversy reaches the stage of hearing and formal adjudication the persons who did the actual work of investigating and building up the case should play no part in the decision. 58 [1924] 1 KB 256 at 258-259. 59 Australian Workers' Union v Bowen [No 2] (1948) 77 CLR 601 at 616; [1948] HCA 35. 60 Leeson v General Council of Medical Education and Registration (1889) 43 Ch D 61 Section 5(c) of the Administrative Procedure Act 1946 (US) (as passed). 62 Attorney General's Committee on Administrative Procedure, Final Report of Attorney General's Committee on Administrative Procedure, (1941) at 56. This is because the investigators, if allowed to participate, would be likely to interpolate facts and information discovered by them ex parte and not adduced at the hearing, where the testimony is sworn and subject to cross- examination and rebuttal. In addition, an investigator's function may in part be that of a detective, whose purpose is to ferret out and establish a case. Of course, this may produce a state of mind incompatible with the objective impartiality which must be brought to bear in the process of deciding. For this same reason, the advocate – the agency's attorney who upheld a definite position adverse to the private parties at the hearing – cannot be permitted to participate after the hearing in the making of the decision. A man who has buried himself in one side of an issue is disabled from bringing to its decision that dispassionate judgment which Anglo-American tradition demands of officials who decide questions. Clearly the advocate's view ought to be presented publicly and not privately to those who decide." Of course, if a person who has once been an accuser is not the ultimate decision-maker, examination of the role of the person in relation to the decision will remain important. But it will ordinarily be sufficient to support the reasonableness of an apprehension that the resultant decision might not have been reached as a result of a neutral evaluation of the merits that the person participated in, or even that the person was present during, the substantive deliberations which resulted either in the decision63 or in the making of a recommendation that the decision be made64. The facts here are fully explained in the joint reasons for judgment. The most critical of them are these. Ms Hughes was the employee of Knox City Council who, as authorised officer, charged Ms Isbester with an offence under s 29 of the Act relating to an attack by her dog. Ms Hughes was later a member with Mr Kourambas of a three-member Panel which deliberated and recommended to Mr Kourambas that he make the order that the dog be destroyed. Mr Kourambas was the employee of the Council who, as delegate of the Council, then made the decision to order under s 84P(e) of the Act that the dog be destroyed. It is important to recognise that nothing in the Act compelled the decision- making structure in fact adopted by the Council for the purpose of s 84P(e). It is also important to note the absence of any suggestion that the participation of 63 Dickason v Edwards (1910) 10 CLR 243 at 252-253, 256-257, 259, 262; [1910] HCA 7; Stollery v Greyhound Racing Control Board (1972) 128 CLR 509 at 519- 64 Rendell v Release on Licence Board (1987) 10 NSWLR 499 at 507. Ms Hughes was a practical necessity. The Council did not need to establish the Panel. The Council having established the Panel, Ms Hughes did not need to be a member. Ms Hughes might have developed, as Ms Isbester's prosecutor, a frame of mind incompatible with the dispassionate evaluation of whether administrative action should be taken against Ms Isbester's interests in light of Ms Isbester's conviction. Ms Hughes' frame of mind might have affected the views she expressed as a member of the Panel, and the expression of those views might have influenced not only the recommendation made by the Panel, which included that recommendation by the acceptance of Mr Kourambas in his capacity as delegate of the Council. Those are all possibilities which fairly arise from the established facts. There is nothing fanciful or extravagant about them. A hypothetical fair-minded observer with knowledge of all of the circumstances would be quite reasonable to apprehend them. In particular, the reasonableness of the apprehension of those possibilities is not negatived by the circumstances: that Ms Hughes acted throughout in her professional capacity as a Council employee; that Ms Isbester pleaded guilty to the offence and that her conviction was on the basis of agreed facts; that the question for decision by the Council under s 84P(e) of the Act arose subsequently to and was different from the question for decision by the Magistrates' Court under s 29 of the Act; and that the evidence as to the course of the Panel hearing did not demonstrate that Ms Hughes took the position of an accuser in that Contrary to the decision of the Court of Appeal, the proper conclusion is therefore that the involvement of Ms Hughes in the deliberative process resulted in a breach of the implied condition of procedural fairness so as to take the decision of Mr Kourambas beyond the power conferred by s 84P(e) of the Act. Although I would grant leave to the Council to file its notice of contention, I would reject the contention that the decision of the Court of Appeal should be affirmed on the ground that a fair-minded observer would not reasonably apprehend bias on the part of Mr Kourambas. I agree with the plurality that the appeal to this Court should be allowed, that the orders of the Court of Appeal and of the primary judge should be set aside, and that the purported legal effect of the decision made in fact by Mr Kourambas should be quashed by an order in the nature of certiorari. Isbester v Knox City Council [2014] VSCA 214 at [70]-[75].
HIGH COURT OF AUSTRALIA Matter No S384/2008 R & R FAZZOLARI PTY LIMITED APPELLANT AND PARRAMATTA CITY COUNCIL RESPONDENT Matter No S385/2008 AND APPELLANT PARRAMATTA CITY COUNCIL & ANOR RESPONDENTS R & R Fazzolari Pty Limited v Parramatta City Council Mac's Pty Limited v Parramatta City Council [2009] HCA 12 2 April 2009 S384/2008 & S385/2008 Matter No S384/2008 ORDER Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 11 June 2008 and in their place order that: paragraph 2 of the orders of the Land and Environment Court of New South Wales made on 28 September 2007 be set aside; and the appeal to the Court of Appeal be otherwise dismissed with costs. Matter No S385/2008 Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 11 June 2008 and in their place order that: paragraph 2 of the orders of the Land and Environment Court of New South Wales made on 28 September 2007 be set aside; and the appeal to the Court of Appeal be otherwise dismissed with costs. On appeal from the Supreme Court of New South Wales Representation B W Walker SC with I J Hemmings for the appellants (instructed by Hunt & Hunt Lawyers) A Robertson SC with R J Carruthers and C R Ireland for the respondent in Matter No S384/2008 and the first respondent in Matter No S385/2008 (instructed by Blake Dawson Lawyers) Submitting appearance for the second respondent in Matter No S385/2008 Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS R & R Fazzolari Pty Limited v Parramatta City Council Mac's Pty Limited v Parramatta City Council Real property – Compulsory acquisition – Where Local Government Act 1993 (NSW) ("LG Act"), s 186(1), provided that council may acquire land "for the purpose of exercising any of its functions" – Where LG Act, s 188(1) provided that council may not acquire land by compulsory process if land being "acquired for the purpose of re-sale" – Relationship between purpose of exercising any council functions and purpose of re-sale – Meaning of "purpose of re-sale" – Whether acquisition of land by council pursuant to development agreement requiring council to hold land acquired on trust for private developer, in exchange for money and money's worth, as part of larger public-private partnership, is acquisition for purpose of re-sale. Real property – Compulsory acquisition – Where LG Act, s 188(2)(a) provided that land may be acquired by compulsory process even if acquisition for purpose of re-sale if land in question adjoins or lies in vicinity of other land acquired at same time under LG Act, Pt 1 of Ch 8, for purpose other than purpose of re-sale – Where adjoining land comprised public roads already vested in fee simple in council – Where Land Acquisition (Just Terms Compensation) Act 1991 (NSW), s 7B provided that State authority authorised to acquire land by compulsory process may do so even where land already vested in authority – Whether adjoining land nevertheless acquired under LG Act, Pt 1 of Ch 8. Statutes – Interpretation – Presumption that legislature does not intend to interfere with property rights unless contrary intention manifest – Consequences for identification of purpose of acquisition. Words and phrases – "function", "public-private partnership", "purpose of re-sale", "re-sale". Local Government Act 1993 (NSW), ss 24, 26, 186, 187, 188, 400B(1), 400B(2). Land Acquisition (Just Terms Compensation) Act 1991 (NSW), s 7B. Roads Act 1993 (NSW), ss 7(4), 145(3), 146(1)(e). Introduction Parramatta City Council ("the Council") is a council constituted for the area of the City of Parramatta under the Local Government Act 1993 (NSW)1 ("the LGA"). It is "a body politic of the State with perpetual succession and the legal capacity and powers of an individual"2. Powers are conferred on the Council by the LGA. They include the power given by s 186 for the Council to "acquire land … for the purpose of exercising any of its functions"3. In the case of a compulsory acquisition, that power is constrained by s 188(1), which provides: "A council may not acquire land under this Part by compulsory process without the approval of the owner of the land if it is being acquired for the purpose of re-sale." The constraint is qualified: "(2) However, the owner's approval is not required if: the land forms part of, or adjoins or lies in the vicinity of, other land acquired at the same time under this Part for a purpose other than the purpose of re-sale". The term "function" in s 186 includes "a power, authority and duty"4. On 1 June 2007 the Council sent proposed acquisition notices to the owners of land in a block in the Parramatta city centre bounded by Smith, Darcy, Church and Macquarie Streets. The acquisitions were related the redevelopment of the block. It was to be called "Civic Place" upon completion. The redevelopment was to be carried out under a Public Private Partnership ("PPP") made pursuant to the LGA between the Council and two companies, Grocon (Civic Place) Pty Ltd ("GCP") and Grocon Constructors Pty Ltd ("GCPL") (together referred to as "Grocon"). The PPP was to be effected by a development agreement between the Council and Grocon. Under that agreement 1 LGA, s 219. 2 LGA, s 220(1). 3 LGA, s 186(1). 4 LGA, Dictionary. the Council would transfer certain of the acquired land to Grocon and receive substantial financial payments and other consideration from Grocon. Two owners, R & R Fazzolari Pty Ltd ("Fazzolari") and Mac's Pty Ltd ("Mac's") (together referred to as "the appellants"), challenged the proposed acquisitions in the Land and Environment Court of New South Wales as being for the purpose of re-sale and therefore falling within the constraint on acquisition imposed by s 188(1) of the LGA. Biscoe J in the Land and Environment Court held the proposed acquisitions to be unlawful. Declarations were made and injunctive relief granted accordingly5. The Council appealed to the Court of Appeal of New South Wales. On 11 June 2008, the Court of Appeal unanimously allowed the appeals and set aside the declarations and orders made in the Land and Environment Court6. On 26 August 2008, the appellants were granted special leave to appeal against the decisions of the Court of Appeal. The resolution of these appeals depends upon the proper construction of the LGA in so far as it defines the powers of a council to acquire land by compulsory process. In accordance with established principles of statutory interpretation the preferable construction is that which authorises the least interference with private property rights. That requires a focus upon the purpose for which the Council proposes to acquire each of the parcels of land the subject of its notices. In this case the Council proposes to dispose of the acquired land to the developer and to receive consideration in money and other benefits. It seeks to characterise the purpose of the acquisition by reference to the larger ends of the Civic Place development. But it is what it intends to do with the appellants' land which, in this case, defines the relevant purpose which is that of re-sale. In my opinion, the appeals should be allowed with costs. The declarations made by the primary judge should be restored and further orders made as proposed in the joint judgment. 5 Mac's Pty Ltd v Minister Administering Local Government Act 1993 (2007) 155 LGERA 362. 6 Parramatta City Councill v R & R Fazzolari Pty Ltd; Parramatta City Council v Mac's Pty Ltd (2008) 162 LGERA 1. The statutory and contractual framework The essential features of the statutory and contractual framework of the proposed acquisitions are: The Environmental Planning and Assessment Act 1979 (NSW) ("EPAA") provides for the making by the Minister of regional environmental plans in respect of a region7. The Sydney Regional Environmental Plan No 28 – Parramatta ("SREP28") was made under the EPAA. Clause 10 of SREP28 provides for the preparation by the Council of master plans outlining, development of land to which the master plan applies. inter alia, detailed provisions relating A master plan for the Civic Place Development ("the Master Plan") was prepared by the Council pursuant to SREP28, adopted on 14 May 2003 and came into effect on 1 June 2003. The LGA provides that a council can enter into a PPP, being an arrangement between the council and a private person for the purpose, inter alia, of providing public infrastructure and facilities8. The LGA entitles a council entering into a PPP for a particular project "to proceed with the carrying out of the project" under the PPP9. A PPP was entered into by the Council with Grocon by way of an agreement entitled the "Civic Place Development Agreement" ("the Development Agreement") dated 21 July 2006. Conditions precedent of the Development Agreement included the acquisition, in the name of the Council, of Darcy Street and Church 7 EPAA, s 51. 8 LGA, ss 400B and 400I. Councils entering such partnerships must comply with the requirements of Pt 6 of Ch 12 of the LGA. 9 LGA, ss 400I and 400E – the entitlement is subject to Div 2 of Pt 6 of Ch 12 of the LGA. Street10, vested in it under the Roads Act 1993 (NSW), and the freehold of properties in those streets including land owned by the appellants. Pursuant to the Development Agreement, Grocon was to construct a residential building of 31 storeys, known as Park Apartments, on the land owned by Mac's and a 40 storey commercial office tower, known as the Atria, on the land owned by Fazzolari with one level of retail and four levels of car parking beneath the surface of both areas of land. The Development Agreement provided that a number of parcels of land, including the appellants', would be consolidated and re-subdivided with most of it transferred to Grocon initially by a declaration of trust followed by transfer of legal title according to progressive completion of the development. 11. Under the Development Agreement the Council was to receive from Grocon upfront participation payments, a revenue share, council facilities and public domain and a housing cash contribution. The Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ("Just Terms Act") sets up procedures for the compulsory acquisition of land but, generally speaking, is not a source of power to acquire land11. There is a relevant exception to that general proposition. An authority of the State which is authorised by law to acquire land by compulsory process in accordance with the Just Terms Act may so acquire the land if it is vested in the authority itself12. The Development Agreement and the Deed of Trust The Development Agreement provided requisite acquisitions of Darcy and Church Streets and certain private properties, the Council and GCP were required to do anything that either might reasonably require to ensure that the properties became part of the defined trust land13. The trust land was to be included in the site of the proposed development14. that, upon the 10 The Development Agreement refers to Darcy and Church Streets. The Council, however, applied for approval to acquire Darcy Street and parts of Church Street. 11 Just Terms Act, s 7. 12 Just Terms Act, s 7B. 13 Development Agreement cl 5.3(b). 14 See Attachment 4 to Exhibit F of the Development Agreement identifying the trust land which included the appellants' properties. The appellants' properties, if acquired by Council, were to be subject to a declaration of trust by the Council in terms of a Deed of Trust exhibited to the Development Agreement15. The trustee was the Council and the beneficiary was GCP. The recitation to the Deed was in the following terms: The Beneficiary is the trustee of the Grocon Parramatta Trusts. The Beneficiary has agreed to procure the development of the Trust Land on the terms and conditions set out in the Development Agreement. Pursuant to the terms of the Development Agreement, including payment of the Transfer Consideration by the Beneficiary, the Trustee has agreed to hold the Trust Land and all Receipts and Rights on trust for the Beneficiary (in its capacity as trustee of the Grocon Parramatta Trusts) as provided in this deed." The term "Transfer Consideration" was not defined in the Deed of Trust or the Development Agreement. Under the Deed of Trust the Council agreed with GCP, inter alia, that it would exercise its power to transfer or otherwise deal with the trust land in any The general operation of the trust was set out in a document entitled "Outline of Key Development Agreement Provisions", provided to Council before it entered into the Development Agreement. That explanation was in the following terms17: "The effect of the Land Trust is as follows: Council will transfer the equitable title of the site to GCP (that is an effective transfer of title to GCP); Council will, however, remain registered as the owner on the land titles register maintained by the NSW Land & Property Information; 15 Development Agreement Exhibit Z. 16 Trust Deed cl 6.1(b). 17 Trust Deed cl 3.2. (c) when the Council Related Works and the Open Space Works are completed, legal title to those parcels will be progressively transferred to Council; (d) when the Development Component is completed and subdivided into each of the individual parcels containing the different staged office, retail, residential and car park elements of the Development Component, Council will execute a transfer of the legal title in those parcels progressively to the Developer or its nominee or will be changed as trustee of the trustee [sic] (so as to effect that transfer); the Developer will indemnify Council for all costs arising from the Land Trust, including any stamp duty, land tax, council or other rates, insurance costs or other costs; and if additional land is acquired by the Developer, such as the Australia Post Site, this will be incorporated into the trust, at the request of the Developer." Various payments were to be made by both Grocon and the Council under the terms of the Development Agreement. These were summarised in the outline document. The key payments were: An initial cash payment of $51 million (plus GST) by GCP to the Council ten business days after the date on which the last of the conditions precedent was satisfied or waived, subject to a proportionate reduction if the grant of development consent did not achieve the minimum acceptable floor space area. 3.8 per cent of project revenues to be paid by GCP to the Council. An additional payment by GCP to the Council in relation to the residential component of the project. An additional payment to the Council by GCP in the event that total revenue from the project exceeded the total cost of the project by an agreed percentage ("Super Profit Share"). A payment by the Council to GCP of $29.7 million (plus GST) as a contribution to defined "Council Related Works" on the date of expiry of a fit-out period after notice of practical completion and upon written notice by GCP indicating that the project revenue exceeded $400 million. A payment by the Council not exceeding $8.87 million by way of rental covering a three year period during which it is entitled to remain in its existing facilities or to new premises being constructed as part of the Council Related Works. Council's applications for compulsory acquisition approval On 24 December 2003, the Council applied to the Department of Local Government seeking ministerial approval for the compulsory acquisition of private properties in Darcy Street and on 24 November 2004 applied for approval for the compulsory acquisition of Darcy Street itself. The Darcy Street private property included Fazzolari's land at 20-22, 24 and 26 Darcy Street. Ministerial approval for the acquisition of Darcy Street, the Darcy Street properties and also 160 Church Street, the land owned by Mac's, was notified to the Council by letter dated 15 December 2006 from the Director General of the Department of Local Government. On 13 December 2006 the Council applied to the Department of Local Government seeking ministerial approval for the compulsory acquisition of part of Church Street. Item 4 of Annexure 2 to that application was headed "Purpose of the Acquisition". This required a statement of the "public purpose" for which the land was being acquired. Reference was made to the Development Agreement and the provision, pursuant to that Agreement, of 12,000 square metres of public open space in the Parramatta CBD together with various other community facilities. The Council said: "The inclusion of part of Church Street will result in the delivery of an additional 2,925 square metres of revitalised public open space. The provision of these public facilities will not be feasible without including Church Street and Darcy Street." Its statement continued: "The purpose of acquiring the relevant part of Church Street is to enable Parramatta City Council to: own the land free of encumbrances and interests; close this part of Church Street; and include part of Church Street Development, the overall Civic Place so that the Civic Place Development including the expected public facilities can proceed." Reference was also made to the acquisition of a substratum beneath Church Street contiguous to the Civic Place site which would be transferred to the developer, GCP, at a later date for the purpose of construction of public car parking and one level of retail development. Annexure 1 to the application set out a checklist of information effectively requiring references to be given to where that information could be found in the text of the completed application. One of the items of information required was a "[s]tatement on why any resale proposal is ancillary to the purpose of the acquisition". The Council identified Item 9.1 of Annexure 2 in answering that request. Item 9.1 of Annexure 2 appeared under the heading "Re-sale" and repeated the substance of what appeared in Item 4 above. A further requirement of the checklist was: "(If acquisition is for re-sale) Indication of any intervening council activity, such as prior subdivision approval by the council." The Council referred to Item 9.2 and Attachment I of Annexure 2. Attachment I referred to the transfer to GCP of the Church Street substratum already covered in Item 4. On 14 March 2007, the Council was notified by the Director General of the Department of Local Government of ministerial approval for the acquisition of part of the Church Street road reserve. In respect of the compulsory acquisition of part of Darcy Street, the General Manager of the Council sent a proposed acquisition notice to the Council itself. The notice addressed to the Council began: "The Parramatta City Council of New South Wales requires the whole of your interest in the land comprising Darcy Street, Parramatta, for a public purpose, namely the Civic Place Development. A full description and title details of the land are in the attached schedule." The trial judge's findings The primary judge, Biscoe J, reached the following principal conclusions: The decision of the Council to acquire the appellants' properties compulsorily was not made for the purpose of exercising any of its functions within the meaning of s 186(1) of the LGA18. The decision of the Council to acquire the appellants' properties compulsorily was not made for the purpose of exercising any of its functions under s 186(2)(b) of the LGA19. 18 (2007) 155 LGERA 362 at 443 [227], 449 [245]. The Council was seeking compulsorily for the purpose of re-sale within the meaning of s 188(1)20. the appellants' properties to acquire The appellants' properties did not adjoin or lie in the vicinity of other land to be acquired under the LGA for a purpose other than a purpose of re-sale within the meaning of s 188(2)(a)21. The primary judge found that the constraint imposed on the power of compulsory acquisition by s 188(1) applied to the proposed acquisition of the appellants' properties. He said22: "In my opinion, a re-sale within the meaning of s 188 includes a transfer of land for a consideration which includes money. That is sufficient to cover what the council intends to do with the applicants' land in the present case." The possibility under the Deed of Trust and the Development Agreement that the properties could return to full ownership of the Council if the project were to cease was no answer to the application of s 188(1). His Honour said23: "Relevantly, s 188(1) is only concerned with whether the proposed acquisition of the applicants' land is for 'the purpose' of re-sale, not with a possibility that a re-sale contemplated by a contract might not occur in the event that the contract does not go ahead." (emphasis in original) The question which arose under s 188(2)(a) was whether the appellants' properties adjoined or lay in the vicinity of other land to be acquired at the same time under the LGA for a purpose other than a purpose of re-sale within the meaning of s 188(2)(a). The Council argued that its acquisition of Church Street and Darcy Street was other than for re-sale. A purpose of acquiring the relevant part of Church Street was to "provide open space for giving effect to the development"24. A purpose of acquiring a part of Darcy Street was the creation 19 (2007) 155 LGERA 362 at 449 [247], 457 [277]. 20 (2007) 155 LGERA 362 at 457 [278], 460 [292]. 21 (2007) 155 LGERA 362 at 460 [293], 461 [298]. 22 (2007) 155 LGERA 362 at 460 [290]. 23 (2007) 155 LGERA 362 at 460 [291]. 24 (2007) 155 LGERA 362 at 460 [294]. of Station Square which would also be open space. His Honour rejected the Council's argument. He held that the reference to "other land" in s 188(2)(a) is a reference to land not already owned by the Council. The Council was already the owner of Church Street and Darcy Street. It could not rely upon the contemporaneous "acquisition" of its existing interest in those streets. In any event the purpose for which Darcy Street and Church Street were to be acquired included re-sale as a substantial purpose. His Honour made declarations that the proposed acquisitions were unlawful. Injunctive relief was also granted preventing publication of the proposed acquisition notices in the New South Wales Government Gazette and further steps to compulsorily acquire the properties. The Court of Appeal judgment The principal judgment in the Court of Appeal was delivered by Tobias JA, with whom Hodgson JA and Palmer J agreed subject to their own concurring reasons25. Key conclusions in the judgment of Tobias JA were: The implementation of the Master Plan was a function of the Council such that s 186(1) empowered it to acquire land for the purpose of exercising that function26. The Council's purpose in acquiring the appellants' properties was at all times, and remained, the implementation of the Civic Place project as contemplated by the Master Plan27. The primary judge's conclusion in relation to s 186(1) was incorrect28. The s 186(2)(b) question did not arise29. The Development Agreement did not propose a "re-sale" of the appellants' land within the meaning of s 188(1). The primary judge's conclusion in relation to s 188(1) was incorrect30. 25 (2008) 162 LGERA 1. 26 (2008) 162 LGERA 1 at 38 [143]. 27 (2008) 162 LGERA 1 at 43 [176]. 28 (2008) 162 LGERA 1 at 43 [177]. 29 (2008) 162 LGERA 1 at 43-44 [178]. 30 (2008) 162 LGERA 1 at 46 [196]. It was unnecessary to deal with the subsidiary questions arising under s 188(2)(a)31. There is no issue on the appeal to this Court about the conclusion of the Court of Appeal that, subject to any constraint imposed by s 188, the Council had power to make the proposed acquisitions under s 186. It is sufficient therefore to refer briefly to the reasoning of Tobias JA on the s 188 questions. Tobias JA held that the critical question not answered by the primary judge was whether the purpose, which he found the Council had, of transferring the appellants' land to Grocon for consideration, was its substantial purpose32. He found33: "The documentary history of this matter makes it clear in my view that the Council proposed and needed to proceed with the acquisition, if necessary by compulsory process, of the [appellants'] land irrespective of whether it was ultimately transferred to Grocon or any other developer." His Honour adopted what he called34 "the test adumbrated by the High Court in CC Auto Port Pty Ltd35" requiring identification of "'the initiating and abiding purpose' of the proposed acquisition". He said36: "On the basis of that test, in my opinion the purpose of the proposed acquisition of the [appellants'] land was not one of re-sale." Tobias JA also rejected the proposition that the proposed acquisitions involved a re-sale of the appellants' land. He relied upon Chan v Dainford Ltd37 for the proposition that the ordinary meaning of "sale" is the exchange of 31 (2008) 162 LGERA 1 at 46 [197]. 32 In the sense used in Thompson v Randwick Corporation (1950) 81 CLR 87; [1950] HCA 33. 33 (2008) 162 LGERA 1 at 45 [186]. 34 (2008) 162 LGERA 1 at 45 [188]. 35 CC Auto Port Pty Ltd v Minister for Works (1965) 113 CLR 365 at 381; [1965] HCA 55. 36 (2008) 162 LGERA 1 at 45 [188]. 37 (1985) 155 CLR 533 at 537; [1985] HCA 15. property for money. He acknowledged that the word "sale" must take its meaning from its statutory context and that its ordinary meaning could be extended expressly or by implication. There was nothing in s 188(1) to extend that ordinary meaning either expressly or by necessary implication. There was nothing to extend it to the complex financial arrangements the subject of the A difficulty with this aspect of his Honour's reasoning is that the invocation of the "complex" nature of the financial arrangements the subject of the Development Agreement does not expose a basis for rejecting their characterisation as "re-sale" in so far as they involve the transfer of the appellants' land to Grocon and the payment by Grocon of consideration to the Council in relation to that transfer (albeit without specific allocation of any part of the consideration to the appellants' lots). Where compulsory acquisition of a number of parcels of land as part of some overarching development scheme is concerned the general proposition nevertheless applies that "[t]he validity of the acquisition of each parcel depends upon the facts concerning that parcel"39. Grounds of Appeal The grounds of appeal set out in the notice of appeal for each of the appeals, amended by leave at the beginning of the hearing, were as follows: The New South Wales Court of Appeal erred by construing the expression 'purpose of re-sale' in sub-section 188(1) of the Local Government Act 1993 (New South Wales) to require re-sale to be the dominant purpose when the Act as a whole means that re-sale could only ever be subservient to some other authorised purpose or statutory function proposed to be carried out by the respondent. 2A. The New South Wales Court of Appeal erred by not characterizing the proposed eventual transfer to Grocon (Civic Place) Pty Ltd and Grocon Constructors Pty Ltd or their nominee or nominees, in return for money and money's worth, of land including the appellant's land as, in the circumstances, a proposed 're-sale' within the meaning of subsec 188(1) of the Local Government Act 1993 (NSW)." The grounds as amended identify two issues. The first, embodied in ground 2A, is whether the transfer of land, including the appellants' land, and the 38 (2008) 162 LGERA 1 at 46 [195]. 39 Estates Development Co Pty Ltd v State of Western Australia (1952) 87 CLR 126 at 142; [1952] HCA 42. receipt of payment would be a "re-sale" of the appellants' land for the purposes of s 188(1). The second is whether the proposed acquisition was for the purpose of re-sale of the land. Notice of Contention By its notice of contention, the respondent sought to uphold the decision of the Court of Appeal on the ground: "That the Court below failed to decided [sic] that if the appellants' land was to be acquired for the purpose of re-sale within the meaning of s 188(1), then the exception to s 188(1) contained in s 188(2)(a) would apply on the basis that the appellants' land forms part of, or adjoins or lies in the vicinity of, other land to be acquired at the same time under Part 1 of Chapter 8 of the Local Government Act 1993 (NSW) for a purpose other than the purpose of re-sale, such other land being the Darcy Street and Church Street road reserves or in the alternative each part of that land that is to be in Council ownership." Legislative history It is helpful to refer briefly to the legislative history leading up to the enactment of s 188. In Thompson v Randwick Corporation40 this Court held that powers of compulsory acquisition conferred by the Local Government Act 1919 (NSW) could only be exercised with respect to land purchased or resumed for a purpose authorised elsewhere in that Act. Where a council attempted to resume more land than required to construct a proposed road, it was held not to be acting in good faith but actuated substantially by the purpose of profit-making by sale of the land not so required. The proposed resumption was therefore not for the purpose of the undertaking by the council of the statutory function of "improvement and embellishment of the area" within the meaning of s 321(d). In the following year, the Court held in Minister for Public Works v Duggan41 that a council was not empowered by the Local Government Act 1919 to acquire land in excess of what it required to fulfil a statutory purpose then resell the excess and use the proceeds to defray the costs of the proposed scheme. In the course of its judgment, the Court said42: 40 (1950) 81 CLR 87. 41 (1951) 83 CLR 424; [1951] HCA 29. 42 (1951) 83 CLR 424 at 449-450. "The question when the whole of a person's lands may be acquired although part only is required for some undertaking so that the residue may be resold at a profit has frequently arisen in England. English legislation often specifies the lands that may be resumed for the statutory purpose. Even so, if the land is resumed for the benefit of a body trading for private gain, such as a railway company, the body may usually be restrained from resuming more of the land so specified than is actually required for the particular work. Public bodies usually may resume the whole of such lands although parts only are required for the particular purpose with a view to re-selling the residue at a profit. But these are all cases where the public body is on the face of the statute authorized to acquire the whole of the land and then empowered to re-sell the surplus land." It is important to note the use by the Court of the term "re-sell" to describe a sale following upon a compulsory acquisition. Following the decision in Duggan, the Local Government Act 1919 was amended by the Local Government (Land Acquisition) Amendment Act 1951 (NSW). The amendment extended the powers of councils with respect to the acquisition of land (including acquisition by resumption) by providing that lands acquired under the 1919 Act43: "may be so acquired for sale or re-sale and applying the proceeds thereof in defraying in whole or in part the expenses incurred by the council in carrying out any work upon lands:– acquired for any purpose of this Act; and of which the lands acquired under paragraph (a) of subsection two of this section form part, or which adjoin or are in the vicinity of land acquired under paragraph (b) of that subsection." In the Second Reading Speech it was said, inter alia, that the Bill was designed to ensure that land could be acquired for re-sale and for recoupment in whole or in part of a council's expenditure on work done on land acquired in the same way, as was believed to be permissible under the existing provisions of the 1919 Act before the decisions of this Court in Thompson and Duggan44. The 43 This amendment was effected by the insertion of s 532(3). 44 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 27 November 1951 at 4591. Minister referred to "the principle of recoupment" as "well established in local government law in both England and this country"45. Major changes to the law relating to local government in New South Wales were introduced with the enactment of the LGA. In the Second Reading Speech the Minister for Local Government described as one of the main features of the legislation that it involved "a fundamental shift from prescriptive to a permissive expression of local government law". This was said to be evidenced by "the conferral of broad general powers on councils accompanied by specific constraints on power – rather than vice versa."46 The acquisition of land was not mentioned in the Second Reading Speech but explanatory notes tabled with the Speech stated, in relation to the Chapter of the LGA which includes ss 186 and 18847: "The chapter begins with setting out the purposes for which council may acquire land. The provisions are generally a re-enactment of the Local Government Act 1919 in that councils may acquire land by agreement or compulsory process in accordance with the Land Acquisition (Just Terms) Compensation Act 1991. However, a major variation occurs in the creation of a limitation on compulsory acquisition by council for the purpose of re-sale. A council may not acquire land by compulsory process without the approval of the owner if it is being acquired for the purpose of re-sale, as re-sale is not strictly a legitimate Local Government purpose. The Bill lapsed in 1992 and was reintroduced in a revised form in 1993. However, it was not suggested that any revisions in 1993 relevantly affected s 188 or rendered any less relevant the observations contained in the Second Reading Speech for the 1992 Bill. Importantly, in my opinion, the character of s 188(1) as a specific constraint on a broad power does not preclude the application to it of established approaches for the interpretation of statutes affecting property rights. 45 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 27 November 1951 at 4593. 46 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 27 November 1992 at 10387. 47 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 27 November 1992 at 10411. The approach to interpretation Private property rights, although subject to compulsory acquisition by statute, have long been hedged about by the common law with protections. These protections are not absolute but take the form of interpretive approaches where statutes are said to affect such rights. Blackstone said that the common law would not authorise the "least violation" of private property notwithstanding the public benefit that might follow48. He accepted however that the legislature could compel acquisition and in so doing wrote49: "All that the legislature does is to oblige the owner to alienate his possessions for a reasonable price; and even this is an exertion of power, which the legislature indulges with caution, and which nothing but the legislature can perform." It was and has remained the case in England and Australia that compulsory acquisition and compensation for such acquisition is entirely the creation of statute50. The attribution by Blackstone, of caution to the legislature in exercising its power over private property, is reflected in what has been called a presumption, in the interpretation of statutes, against an intention to interfere with vested property rights. It was expressed by Griffith CJ in Clissold v Perry51, a land "In considering this matter it is necessary to bear in mind that it is a general rule to be followed in the construction of Statutes such as that with which we are now dealing, that they are not to be construed as interfering with vested interests unless that intention is manifest." 48 Blackstone, Commentaries on the Laws of England, (1765), bk 1, c 1 at 135. 49 Blackstone, Commentaries on the Laws of England, (1765), bk 1, c 1 at 135. 50 Rugby Joint Water Board v Shaw-Fox [1973] AC 202 at 214 per Lord Pearson, cited with approval in Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 233 CLR 259 at 270 [29]; [2008] HCA 5. 51 (1904) 1 CLR 363; [1904] HCA 12. 52 (1904) 1 CLR 363 at 373, Barton and O'Connor JJ concurring at 378. The presumption has been restated on more than one occasion in this Court53. That does not, of course, authorise the court to put to one side "the unambiguous effect of the words which the Parliament has seen fit to use"54. The terminology of "presumption" is linked to that of "legislative intention". As a practical matter it means that, where a statute is capable of more than one construction, that construction will be chosen which interferes least with private property rights. That approach resembles and may even be seen as an aspect of the general principle that statutes are construed, where constructional choices are open, so that they do not encroach upon fundamental rights and freedoms at common law. It operates in the United Kingdom as a manifestation of a "principle of legality" and has been described in Australia as an aspect of the rule of law55. In its application to property rights this long-standing interpretive principle is consistent with international developments in the recognition of human rights since World War II. Although not specifically protected by the International Covenant on Civil and Political Rights, or the International Covenant on Economic, Social and Cultural Rights, the right to property was recognised in the Universal Declaration of Human Rights and in various other international instruments56. Discrimination, based on race, in relation to the enjoyment of property rights is prohibited by Art 5 of the International Convention on the Elimination of all Forms of Racial Discrimination 196557. 53 Greville v Williams (1906) 4 CLR 694; [1906] HCA 97; Wade v New South Wales Rutile Mining Co Pty Ltd (1969) 121 CLR 177; [1969] HCA 28; Clunies-Ross v The Commonwealth (1984) 155 CLR 193; [1984] HCA 65 and see generally Pearce and Geddes, Statutory Interpretation in Australia, 6th ed (2006) at 179-180 54 Nintendo Co Ltd v Centronics Systems Pty Ltd (1994) 181 CLR 134 at 146; [1994] HCA 27. 55 K-Generation Pty Limited v Liquor Licensing Court (2009) 83 ALJR 327 at 338 [47]; 252 ALR 471 at 481; [2009] HCA 4. 56 Universal Declaration of Human Rights 1948, Art 17; American Declaration of the Rights and Duties of Man 1948, Art 23; European Convention for the Protection of Human Rights and Fundamental Freedoms 1950, Protocol 1, Art 1; American Convention on Human Rights 1969, Art 21; African Charter on Human and Peoples' Rights 1981, Art 14. 57 See also Arts 15 and 16 of the Convention on the Elimination of All Forms of Discrimination Against Women 1979. And generally: Jayawickrama, The Judicial Application of Human Rights Law, (2002) at 908-920; and Martin et al, International Human Rights and Humanitarian Law: Treaties, Cases and Analysis, (Footnote continues on next page) The constraint imposed by s 188 on the power conferred by s 186 is to be read conventionally according to the ordinary meaning of the words of the section having regard to their context and purpose and, in this case, having regard to the established rules for the construction of statutes affecting property rights. That has a particular consequence for the way in which the purpose of the relevant acquisition is identified. That identification will focus on the use to which the particular land to be acquired is to be put rather than larger developmental objectives involving other parcels of land. Whether the Development Agreement involved re-sale of the appellants' land The first question to be addressed is whether the proposed transfer of the appellants' land to GCP, coupled with the proposed payments to Council, would constitute a "re-sale" of the land within the meaning of that term in s 188(1). The word "re-sale" in s 188(1) is directed to sale by the council following compulsory acquisition of the land. It is used on the assumption that the antecedent compulsory acquisition by the council is to be treated as a forced sale to the council by the owner of the land. That usage is consistent with the use of the term "re-sell" in the passage quoted from Duggan. It is a usage which was reflected in the 1951 amendments to the Local Government Act 1919. The question which then arises is whether the proposed transfer of the appellants' land to Grocon is a "sale" of that land to Grocon. If so then, putting to one side the distinct question of the purpose of the proposed acquisition of the land by Council, it would be a "re-sale" by the Council within the meaning of The relevant ordinary meaning of the word "sale" is58: "the exchange of a commodity consideration." for money or other valuable This Court in Chan v Dainford Ltd59 in construing s 71 of the Property Law Act 1974 (Qld) observed60: (2006) at 911-936; Sieghart, The International Law of Human Rights (1983) at 58 Shorter Oxford English Dictionary, 3rd ed (1973), vol 2 at 1876-1877. 59 (1985) 155 CLR 533. 60 (1985) 155 CLR 533 at 537. "The primary meaning of sale is an exchange of property, the subject of the sale, for money." That cannot be taken to exclude the possibility that a sale of land may involve its transfer for money and/or other valuable consideration. The constraint, protective of property rights, imposed by s 188 cannot be limited to cases in which the proposed re-sale is for money. Such a construction would artificially limit the scope of the word "re-sale" to one aspect of the ordinary meaning of the word "sale". It would also allow transactions to be structured by local authorities in such a way as to avoid the constraint imposed by s 188 while perpetrating the very mischief it is designed to prevent. The Development Agreement required the Council to transfer the appellants' land to Grocon. In consideration of the Council performing its obligations it was to receive money and other benefits from Grocon. It is not to the point that no element of the consideration moving from Grocon was allocated to the appellants' properties. The land was to be transferred, along with other land, in exchange for money and other consideration. The land was therefore to be the subject of a "re-sale" by the Council within the meaning of s 188. Whether the proposed acquisition was for the purpose of re-sale The Development Agreement necessarily involved the re-sale by the Council of the appellants' properties to Grocon. The question therefore arises whether the proposed acquisition of those properties was "for the purpose of re- sale" within the meaning of s 188(1). The conclusion is inescapable that re-sale was one of the purposes of the proposed acquisitions, albeit it was said to have been in aid of the larger purpose of the redevelopment of Civic Place in Parramatta. Whether they were acquisitions for the purpose of re-sale within the meaning of s 188(1) depends upon the proper construction of that sub-section. One constructional question is whether the purpose of re-sale necessary to attract the constraint imposed by s 188(1) must be: the sole purpose or; the dominant purpose or; (iii) a substantial purpose; or whether it suffices that a purpose of re-sale be one among a number of purposes of the acquisition. That question can distract from a more important aspect of the operation of the section. The purpose with which the section is concerned is the purpose of the acquisition of the particular land to be acquired. Where a number of parcels of land are to be acquired in aid of some large scale redevelopment, it is nevertheless the purpose of the acquisition of each such parcel of land that is to be considered in determining whether it is within or beyond power. The constraint imposed by s 188(1) upon the general power conferred upon Council by s 186 to acquire land for the purpose of exercising any of its functions is a constraint which requires "the approval of the owner of the land if it is being acquired for the purpose of re-sale". The acquisition upon which the constraint operates is that of a particular parcel of land. The question which it poses is whether that parcel of land is being acquired for the purpose of re-sale. The primary judge found that61: "In the present case the purpose of the proposed acquisition of the applicants' land is not to use any part of their land for any public purpose, but rather to transfer the whole of it to Grocon, or to allow Grocon to develop it in order to make a profit." This finding, made in the context of the s 186(1) question, was sufficient to support his Honour's conclusion that s 188(1) applied to the acquisition. Given that the compulsory acquisition of land for re-sale will almost always be supported by reference to some larger public purpose, it cannot be a necessary condition of the application of s 188(1) that the purpose of re-sale be the sole or even the dominant purpose of acquisition. It should suffice that it is a substantial, ie non-trivial purpose. These alternative constructions, however, tend to become indistinguishable in their practical application when the inquiry is, as it should be, focussed on the purpose for which the particular parcel of land is to be acquired from its owner without that owner's approval. That purpose will be assessed by what the council intends to do with the land, ie whether it intends to re-sell it or to do something else with it in the exercise of its functions. It was in support of this proposition that the trial judge quoted62 the following passage from Gleeson CJ's judgment in Woollahra Municipal Council v Minister for the Environment63: "In the context of planning law, a statement of the purpose for which land is being used is a description or characterisation of what is 61 (2007) 155 LGERA 362 at 448 [241]. 62 (2007) 155 LGERA 362 at 444 [234]. 63 (1991) 23 NSWLR 710 at 714-715. being done with, or upon, the land, not an account of the motives of the persons involved in that activity. The question in the present case is whether the use to which the land is being put, which is to be identified by reference to the nature of the activity being conducted upon it, is a use for a purpose authorised by the Act." The Council submitted that, having regard to the context provided by the Development Agreement, its purpose should not be characterised solely by reference to what would occur to a specific lot. The "integrated" nature of the development of Civic Place was invoked. In the circumstances it was said to be "inapt to suggest that Council's 'purpose' would have differed had the ultimate design resulted in a library or Council's chambers being erected upon [the appellants'] lands". The appellants in reply said that the Council's argument wrongly ignored the fundamental focus of the statutory power of acquisition upon individual pieces of land with individual owners. It was the purpose of acquisition of each owner's "lot" which had to be characterised in order to know whether the power could be exercised regardless of the owner's consent. In my opinion, for the reasons already given, the appellants' submission in this respect is correct. The Council's purpose in relation to the appellants' lots is the purpose of re-sale. If it be necessary to say so, it is a substantial purpose and indeed the dominant purpose in relation to those particular parcels of land. It follows that, subject to the possible application of s 188(2)(a), the proposed acquisition of the appellants' properties is caught by s 188(1) and lies beyond the power of the Council. Whether the proposed acquisition of the appellants' properties was valid under s 188(2)(a) The Council sought to support the decision of the Court of Appeal on the basis that the qualification in s 188(2)(a) upon the constraint imposed by s 188(1) was applicable to this case. As outlined earlier in these reasons, the learned primary judge held that s 188(2)(a) could not apply because it did not extend to the acquisition by the Council of "other land" already owned by the Council. In this case the "other land" to be acquired by the Council comprised the parts of Church and Darcy Streets which were the subject of its applications for compulsory acquisition approval in November 2004 and December 2006 respectively. In any event, the learned primary judge held that the acquisition of those parts of the streets included re-sale as a substantial purpose64. 64 (2007) 155 LGERA 362 at 460-461 [295]-[298]. The Court of Appeal, having found that his Honour was mistaken in his answers to the earlier question about s 186(1), held that the application of s 186(2)(b) did not arise65. The appellants submitted that the proposed acquisition by the Council of Darcy Street and parts of Church Street would necessarily be made pursuant to s 7B of the Just Terms Act. That section provides: "An authority of the State that is authorised by law to acquire land by compulsory process in accordance with this Act may so acquire the land even if the land is vested in the authority itself." The term "authority of the State" is defined in s 4 of the Just Terms Act to include "a council or a county council within the meaning of the Local Government Act 1993". The appellants argued that it is by virtue of s 7B of the Just Terms Act that the Council is expressly authorised compulsorily to acquire land from itself. This would mean that the power of compulsory acquisition in respect of such land is made under s 7B, and not under the LGA nor covered by s 188(2)(a). It is not contentious that the Council's interest in Church and Darcy Streets derives from the Roads Act 1993. That Act provides, inter alia66: "All public roads within a local government area (other than freeways and Crown roads) are vested in fee simple in the appropriate roads authority." The dedication of land as a public road67: "does not authorise the owner of the road to dispose of any interest (other than an easement or covenant) in the land …" The Act also provides that the council of a local government area is the roads authority for all public roads within the area save for exceptions which are immaterial for present purposes68. 65 (2008) 162 LGERA 1 at 43-44 [178]. 66 Roads Act 1993, s 145(3). 67 Roads Act 1993, s 146(1)(e). 68 Roads Act 1993, s 7(4). While the Just Terms Act deals with procedures for the compulsory acquisition of land by authorities of the State and compensation on just terms for the owners of such land, s 7B goes beyond those procedures. It is a substantive source of power not conferred upon the Council by the LGA, to acquire an unencumbered interest in land vested in the Council itself, in this case the land known as Church and Darcy Streets. Because the qualification in s 188(2)(a) upon the constraint imposed by s 188(1) is only engaged where the "other land" acquired by the Council is acquired "under this Part", that is under Pt 1 of Ch 8 of the LGA, it does not apply where the other land is, as in this case, acquired under s 7B of the Just Terms Act. Conclusion For the preceding reasons each of the appeals to this Court should be allowed with costs. I agree with the proposal in the joint judgment that the declarations made by the learned primary judge should be restored. I agree with the orders proposed in the joint judgment. GUMMOW, HAYNE, HEYDON AND KIEFEL JJ. In July 2006, the respondent, Parramatta City Council ("the Council") made an agreement ("the development agreement") with Grocon (Civic Place) Pty Ltd ("GCP") and Grocon Constructors Pty Limited (together, "Grocon") to effect the development of an area bounded by Smith, Darcy, Church and Macquarie Streets, Parramatta, which will be called "Civic Place". The appellant in each of these appeals owns land in that area. R & R Fazzolari Pty Limited ("Fazzolari") owns three pieces of land in Darcy Street (known as 20-22, 24 and 26 Darcy Street); Mac's Pty Limited ("Mac's") owns the land known as 160 Church Street. In June 2007, the Council gave notice to the appellants that it intends to acquire each appellant's land compulsorily. The appellants allege that the compulsory acquisition of their land, proposed by the Council, is not authorised by the provisions of Pt 1 of Ch 8 (ss 186-190) of the Local Government Act 1993 (NSW) ("the LG Act"). They submit that their land is being "acquired for the purpose of re-sale" within the meaning of s 188(1) and that the Council may therefore not acquire the land under Pt 1 of Ch 8 by compulsory process, without the approval of the owner. The Council denies that the land is being acquired for the purpose of re-sale and says that, in any event, s 188(2)(a) of the LG Act is engaged. That sub-section provides that the owner's consent is not required for acquisition if the land to be acquired "adjoins or lies in the vicinity of, other land acquired at the same time under [Pt 1 of Ch 8] for a purpose other than the purpose of re-sale". The "other land" identified is Darcy Street and Church Street, which the Council intends to acquire compulsorily at the same time as it acquires each appellant's land. In this Court, the appellants seek orders restoring declarations made in the Land and Environment Court of New South Wales69 that the compulsory acquisition of each appellant's land, proposed by the Council, is unlawful. These reasons will show that the appellants are entitled to that relief. The Fazzolari land and the Mac's land is being acquired for the purpose of re-sale. The Council does intend to acquire, at the same time as the appellants' land, the land now forming Darcy Street and Church Street, but that acquisition will not be made under Pt 1 of Ch 8 of the LG Act. 69 Mac's Pty Ltd v Minister Administering Local Government Act 1993 (2007) 155 LGERA 362. The facts The area which it is intended will become Civic Place has an area of about 32,000 square metres of which the Council owned about 50 per cent. The area adjoins the Parramatta Railway Station and Transport Interchange. It contains the Council's administrative offices, its council chambers, town hall, library and community meeting rooms. In 2003, the Council adopted a Master Plan which applied to the proposed Civic Place site. That Master Plan recorded that the redevelopment of the site "will reposition Parramatta as the capital of western Sydney and a centre of business, tourism, entertainment, culture and heritage". Development of the site in the manner proposed would be too expensive for the Council to undertake alone. In July 2006, the Council made the development agreement with Grocon. The development agreement established what the LG Act refers to as a "public-private partnership". So far as now relevant, the LG Act defines70 a public-private partnership as: "an arrangement between a council and a private person for the purposes providing public infrastructure or facilities (being infrastructure or facilities in respect of which the council has an interest, liability or responsibility under the arrangement)". The term "arrangement" is defined71 in the LG Act as including "a contract or understanding (whether or not involving the formation of an entity)" and "entity" is defined72 as meaning "any partnership, trust, corporation, joint venture, syndicate or other body (whether or not incorporated)". As the breadth of the definitions of "arrangement" and "entity" indicate, the expression "public-private partnership", when used in the LG Act, can apply to many forms of contract or understanding between a council and a "private person". Just as "[t]he term 'joint venture' is not a technical one with a settled 70 s 400B(1). References to the applicable provisions are to the form they took at the relevant time. 71 s 400B(2). 72 s 400B(2). common law meaning"73, the expression "public-private partnership" cannot be understood as having any technical meaning separate from the meaning the LG Act gives it. The content of the rights and obligations created by or subsisting under an arrangement constituting a public-private partnership will depend upon the terms of the particular arrangement. Section 400E of the LG Act provides that a council must not enter into, or carry out any project under, a public-private partnership except in accordance with Pt 6 of Ch 12 of that Act. Part 6 of Ch 12 contains a number of provisions for assessing a proposed project and makes particular provision74 for the project to be reviewed by the Project Review Committee if it is a "significant project" or if, in the opinion of the Director-General of Local Government, it has a "high risk". The Project Review Committee is comprised75 of senior State government officials or their nominees. The development agreement between the Council and Grocon recorded that the Project Review Committee had approved the entry by the Council into the agreement pursuant to s 400I of the LG Act. The development agreement provided that the Council granted Grocon the right to carry out the development of the "Site" and obliged Grocon (at Grocon's cost) to finance, design, construct and commission the "Works" in accordance with the agreement. The "Site" was defined in the agreement and included what was called the "Trust Land". The "Trust Land" included what was referred to in an attachment to the agreement as the "Darcy Street Properties (as acquired by Compulsory Acquisition)". Those properties included the Fazzolari land and the Mac's land. The "Works" comprised not only buildings and facilities which the Council would use or make available for use by the public, but also residential, commercial and retail buildings which Grocon would own and be able to dispose of as those companies saw fit. Clause 2.1 of the development agreement provided that until certain conditions precedent were satisfied or waived, the rights and obligations of the parties under the agreement, apart from some that were specifically identified, would not become binding. One of the conditions precedent was the acquisition, in the name of the Council, of the freehold of the "Darcy and Church Street 73 United Dominions Corporation Ltd v Brian Pty Ltd (1985) 157 CLR 1 at 10 per Mason, Brennan and Deane JJ; [1985] HCA 49. 74 s 400F(3). 75 s 400J. Properties". Those properties included the Fazzolari land and the Mac's land but also included Darcy Street and Church Street. The use in the development agreement of the expression "Trust Land" reflects the way in which the development agreement provided for that land to be dealt with. The development agreement provided that, upon acquisition by the Council of the Darcy and Church Street Properties, the Council and GCP were each bound to do anything that either might reasonably require to ensure that the appellants' land (and certain other land) "become part of the Trust Land". That was to be done by the Council executing a Trust Declaration (in a form annexed to the development agreement) at the same time as GCP paid to the Council an amount fixed according to a formula set out in the agreement. The agreed form of Trust Declaration provided for the Council to declare that it holds the Trust Land on trust for GCP (in its capacity as trustee for certain other trusts). The Trust Declaration recorded that the Council, as Trustee, agrees with GCP that it would not sell, encumber or otherwise dispose of the Trust Land, or any interest in it, and that it would exercise its powers, including the power to transfer or otherwise deal with the Trust Land, "in any manner [GCP] ... from time to time requests in writing and not otherwise". And the Trust Declaration further recorded that in certain circumstances GCP might remove the Council as Trustee, and appoint a new trustee. For present purposes, it is sufficient to observe that one such circumstance is the completion of the Council and Community Facilities referred to in the agreement as "Council Works", and GCP procuring the creation, by plan of subdivision, of a separate stratum parcel registered under the Real Property Act 1900 (NSW) for the Council Works. The relevant provisions of the LG Act Disposition of the present matter turns particularly upon the proper construction and application of s 188(1) and (2)(a) of the LG Act. To put those provisions in their proper context, however, and to follow the course of proceedings in the courts below, it is necessary to consider s 186. The text of the relevant provisions is as follows: "186 For what purposes may a council acquire land? (1) A council may acquire land (including an interest in land) for the purpose of exercising any of its functions. (2) Without limiting subsection (1), a council may acquire: land that is to be made available for any public purpose for which it is reserved or zoned under an environmental planning instrument, or land which forms part of, or adjoins or lies in the vicinity of, other land proposed to be acquired under this Part. (3) However, if the land acquired is, before its acquisition, community land vested in a council, the acquisition does not discharge the land from any trusts, estates, interests, dedications, conditions, restrictions or covenants that affected the land or any part of the land immediately before that acquisition. 188 Restriction on compulsory acquisition of land for re-sale (1) A council may not acquire land under this Part by compulsory process without the approval of the owner of the land if it is being acquired for the purpose of re-sale. (2) However, the owner's approval is not required if: the land forms part of, or adjoins or lies in the vicinity of, other land acquired at the same time under this Part for a purpose other than the purpose of re-sale". The proceedings below The proposed acquisition notices which the Council gave the appellants on 1 June 2007 were given under s 11 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ("the Acquisition Act"). Each notice related to a separate parcel of land and stated that the Council required the whole of the appellant's interest in that land "for a public purpose, namely the Civic Place Development". After the notices were given, each appellant commenced a proceeding in the Land and Environment Court seeking declarations that the acquisitions proposed by the Council are unlawful, and seeking interlocutory and permanent injunctions restraining the Council from effecting the acquisitions. Mac's brought its proceeding against not only the Council but also the Minister administering the LG Act. No relief was granted against the Minister at first instance. The Minister filed a submitting appearance in this Court. It is not necessary to refer further to this aspect of the matter. Each appellant alleged, in the Land and Environment Court, not only that the proposed compulsory acquisition would be in breach of s 188(1) of the LG Act (because the land is being acquired for the purpose of re-sale) but also that the proposed acquisition is beyond the Council's powers because it is not for the purpose of exercising any function of the Council but rather for the purpose of benefiting Grocon, a third party. This second argument is not maintained in this Court. The Council submitted that s 188(1) does not apply, first, because the acquisitions were not "for the purpose of re-sale", and secondly, because s 188(2)(a) is engaged. At first instance, Biscoe J held76 that each appellant was entitled to the declarations and injunctions it sought against the Council. His Honour concluded77 that the Council proposed to acquire the land for the purpose of re-sale. In his Honour's opinion78 "'the' purpose of the acquisition of the [appellants'] land is to transfer it to Grocon for the consideration" of money and other benefits which the development agreement obliges Grocon to provide to the Council. On the issue presented by s 188(2)(a) of the LG Act, Biscoe J concluded79 that the appellants' land did not adjoin, or lie in the vicinity of, "other land acquired at the same time ... for a purpose other than the purpose of re-sale". Two separate reasons were given for that conclusion. First, Biscoe J held80 that the reference to "other land acquired at the same time" should be construed as a reference to land not already owned by the Council, and the Council is already the owner of Darcy Street and Church Street. Secondly, Biscoe J held81 that the purpose for which Darcy Street and Church Street are each to be acquired "includes re-sale as a substantial purpose". 76 (2007) 155 LGERA 362. 77 (2007) 155 LGERA 362 at 457-458 [281]. 78 (2007) 155 LGERA 362 at 457-458 [281]. 79 (2007) 155 LGERA 362 at 460-461 [293]-[298]. 80 (2007) 155 LGERA 362 at 460 [295]. 81 (2007) 155 LGERA 362 at 460 [296]. The Council appealed to the Court of Appeal in each matter. That Court (Hodgson and Tobias JJA, Palmer J) allowed82 the Council's appeals, set aside the declarations made and injunctions ordered by Biscoe J, and in their place, ordered that the proceedings in the Land and Environment Court be dismissed. The principal reasons of the Court of Appeal were those of Tobias JA. Each of Hodgson JA and Palmer J agreed substantially with the reasons of Tobias JA but added short reasons dealing separately with one or more aspects of the matter. In the Court of Appeal a deal of argument was directed to whether the Council is given power by s 186(1) of the LG Act to acquire the appellants' land. That question turned upon whether the Council sought to acquire the land in question "for the purpose of exercising any of its functions". Reference was made, in that connection, to the provisions of s 24 of the LG Act. That section provides: "A council may provide goods, services and facilities, and carry out activities, appropriate to the current and future needs within its local community and of the wider public, subject to this Act, the regulations and any other law." The Council noted that the dictionary provided in the LG Act said that "function includes a power, authority and duty" and argued that its proposed acquisition of the land was for the purpose of exercising its function under s 24 to "carry out activities, appropriate to the current and future needs within its local community and of the wider public". It would seem, however, that little attention was directed in argument in the Court of Appeal to the effect of the limiting words at the end of s 24: "subject to this Act, the regulations and any other law". Because the appellants accepted, in this Court, that the acquisitions which the Council proposed were for the purpose of exercising its function of carrying into effect the public-private partnership with Grocon, it is not necessary to examine any question about the proper construction of s 24 or whether s 24 is engaged in any relevant way. It is important, however, to notice that the reasoning adopted in the Court of Appeal on the issues tendered in this Court must be understood against a background provided by the need to identify the relevant function of the Council and the Council's reliance upon arguments which 82 Parramatta City Council v R & R Fazzolari Pty Ltd (2008) 162 LGERA 1. identified that function at the level of generality and abstraction in which s 24 of the LG Act is expressed. Identifying, for the purposes of s 186(1), the relevant function of the Council as being to "provide ... services and facilities ... appropriate to the current and future needs within its local community and of the wider public" appears to have been an important step towards the conclusions reached by Tobias JA about the application of s 188(1) and, in particular, the purpose of the acquisitions. First, Tobias JA concluded83 that "the Council's sole or dominant purpose" in making the development agreement with Grocon was to implement the Civic Place project. And upon that footing Tobias JA reached the further conclusion84 that the "financial structure" adopted by the Council and recorded in the development agreement was not "'the purpose' for which the [appellants'] land was acquired". Rather, Tobias JA concluded85 that the Council's purpose in acquiring the appellants' land (and the other Darcy Street properties) "was at all times and remained the implementation of the Civic Place project as contemplated by the Master Plan". It will be observed that the reasoning proceeds from a conclusion about the Council's functions (a question relevant to the Council's power under s 186(1) to acquire the land) to a conclusion about the Council's purpose in making the development agreement. This latter purpose is then treated as being the purpose of the acquisition of the land. But as will later be explained, to ask what function the Council is exercising when it seeks to acquire land does not answer, at least in these cases, the different question posed by s 188(1), which is whether the acquisition of the land is for the purpose of re-sale. In his separate reasons, Hodgson JA concluded86 that to engage s 188(1) the purpose of re-sale "must be the dominant purpose, or at least a substantial element of the dominant purpose or a substantial purpose which is independent of the dominant purpose that satisfies s 186(1)". In these cases, Hodgson JA 83 (2008) 162 LGERA 1 at 38-39 [147]. 84 (2008) 162 LGERA 1 at 39 [148]. 85 (2008) 162 LGERA 1 at 43 [176]. 86 (2008) 162 LGERA 1 at 6 [6]. concluded87 that "re-sale is neither the dominant purpose nor a substantial element of it, nor is it a substantial purpose independent of ... the dominant purpose of putting into effect the substance of the Master Plan". Palmer J agreed88 with the reasons of Tobias JA and the additional reasons given by Hodgson JA about the question of purpose. Because the Court of Appeal held that the primary judge had erred in concluding that the land was being acquired by the Council for the purpose of re-sale, it was not necessary for that Court to reach any conclusion about the issue posed by s 188(2)(a): whether the appellants' land adjoins or lies in the vicinity of other land acquired at the same time under Pt 1 of Ch 8 for a purpose other than the purpose of re-sale. Acquired for the purpose of re-sale? The expression "acquired for the purpose of re-sale", when used in s 188(1), identifies a class of acquisitions of land that a council may not effect by compulsory process without the approval of the owner of the land. It identifies that class by focusing attention upon whether the purpose of the acquisition was a specific purpose – "re-sale" – rather than whether the purpose can be described as being an exercise of the Council's functions, the question posed by s 186(1). As noted earlier, it was accepted that the acquisitions of the appellants' land was for the purpose of exercising the Council's function of carrying the public-private partnership into effect. To ask which function or functions of the Council would be being exercised if the Council acquired either the Fazzolari land or the Mac's land does not assist in deciding whether, under s 188(1), the acquisition was for the purpose of re-sale. It is not necessary in these cases to decide whether "the purpose" spoken of in s 188(1) is to be defined more precisely: whether as the sole purpose, or the dominant purpose, or in some other way. That is not necessary because the proposed acquisition of both the Fazzolari land and the Mac's land is for only one purpose: the purpose of re-sale of the appellants' land to Grocon. The purpose of the acquisition can be expressed at different levels of generality and abstraction. So, for example, it can be described as being for the purpose of the Civic Place development, or for the purpose of fulfilling the 87 (2008) 162 LGERA 1 at 6 [6]. 88 (2008) 162 LGERA 1 at 47 [202]. development agreement, or for the purpose of the Council performing its obligations under that agreement. Perhaps there are other expressions of the purpose that could be adopted. But whatever level of generality or abstraction is chosen when identifying the purpose of the acquisition, closer examination of that purpose will always reveal that, upon the land being acquired, the Council is to declare itself trustee of the land in return for Grocon's provision of money and money's worth. For that is the means that is stipulated in the development agreement as the means of achieving whatever more general or abstract statement of purpose is adopted. No doubt the acquisitions of the Fazzolari land and the Mac's land are only two steps in a much larger arrangement recorded in the development agreement. And the development agreement can be described as being directed to the end of implementing the Master Plan for the development of Civic Place. It is therefore possible to describe each of the steps for which the development agreement provides as a step towards implementing the Master Plan or effecting the development of Civic Place. But when the Council gave proposed acquisition notices to Fazzolari and to Mac's, the Council had made the development agreement with Grocon. The development of Civic Place for which the appellants' land was to be acquired is for the development as the Council and Grocon stipulated in the development agreement. Stating the purpose of the acquisition as being to implement the Master Plan or to develop Civic Place, or at some other similar level of generality, must not be permitted to obscure the fact that when the acquisitions were proposed a precise form of development had been agreed. Very particular terms governing both acquisition and disposition of the appellants' land had been stipulated in the development agreement. The steps which the development agreement requires to be taken, of the Council declaring itself trustee of the Trust Land (including the Fazzolari land and the Mac's land) on the terms stipulated, in return for Grocon providing the agreed consideration, are properly described as a "re-sale" of the land. Of course the word "re-sale" suggests the need to identify a prior sale to the Council. But it is important to recognise that "re-sale" is used in the context of acquisition by compulsory process. The compulsory acquisition of the land by the Council is an acquisition for which the Council must pay monetary compensation. The disposition of the land by the Council to Grocon is a disposition in return for the money and money's worth which the development agreement obliges Grocon to provide. That disposition is properly called a "re-sale". It may be observed that the provisions of the development agreement which stipulate the parties' obligations are more elaborate than a simple agreement to buy an identified piece of land for a stated price. But neither the elaboration of the agreement, nor the attachment to it of the descriptive title of "financial structure", denies that the development agreement provides for the Council to first acquire the Fazzolari land and the Mac's land by compulsory process, and then to dispose of the land to Grocon in return for money and money's worth. Neither the elaboration of the terms nor the identification of the arrangement as providing a financial structure detracts from the conclusion that the disposition to Grocon is a "re-sale" of the land. For these reasons it follows that Biscoe J was right to hold that the purpose of the acquisitions, in these cases, was to transfer the land to Grocon for the stipulated consideration. That is, the land was to be acquired for the purpose of re-sale. It then is necessary to consider the question presented by s 188(2)(a). Do the Fazzolari land and the Mac's land adjoin or lie in the vicinity of other land the Council acquires at the same time under Pt 1 of Ch 8 for a purpose other than the purpose of re-sale? As noted earlier, the "other land" in these cases is the land forming Darcy Street and Church Street. Acquiring Darcy Street and Church Street Both Darcy Street and Church Street are public roads. The Roads Act 1993 (NSW) ("the Roads Act") provides89 that, subject to some exceptions which are not engaged in these matters, all public roads within a local government area "are vested in fee simple in the appropriate roads authority". The Council is90 the "appropriate roads authority". Section 146 of the Roads Act provides for what the heading to the section describes as the "Nature of ownership of public roads". For present purposes, it is important to notice only s 146(1)(e), and its provision that dedication of land as a public road "does not authorise the owner of the road to dispose of any interest (other than an easement or covenant) in the land" (emphasis added). Although the Roads Act vests Darcy Street and Church Street in the Council in fee simple, the development agreement between Grocon and the Council obliges the Council to acquire Darcy Street and Church Street by compulsory process. That step, of the Council acquiring by compulsory process land which is already vested in it, is permitted by s 7B of the Acquisition Act which provides that: 90 Roads Act 1993 (NSW) ("the Roads Act"), s 7(4). "An authority of the State that is authorised by law to acquire land by compulsory process in accordance with this Act may so acquire the land even if the land is vested in the authority itself." A consequence of the Council acquiring the two streets by compulsory process would be that each street would cease to be a public road91. Upon each street ceasing to be a public road the Council would be freed from the limitation on its powers now provided by s 146(1)(e) of the Roads Act – that its ownership of the two streets does not authorise the Council to dispose of any interest in the land other than an easement or covenant. Most of the land which forms Darcy Street, and a stratum of land beneath Church Street (the precise identification of which is to be agreed by the Council and GCP), is to be dealt with under the development agreement as Trust Land. Some of the area of what is now Darcy Street will be incorporated within commercial and residential buildings to be built by Grocon. Some will be returned to the Council for use as a public road and as public space. As Biscoe J92 found: "[t]he surface and subsurface of this land will in part form part of publicly available arcades and a retail concourse linking the Civic Place development with the Parramatta Transport Interchange. A deeper subsurface stratum will be part of the publicly available subsurface parking". Most of the area of what is now Church Street is to be refurbished by Grocon and returned to the Council as open space. The stratum to be transferred to Grocon is for the construction of a public car park and one level of retail development. Is the land comprising the two streets to be "acquired at the same time under this Part" as the Fazzolari land and the Mac's land "for a purpose other than the purpose of re-sale"? The appellants submitted that there were two separate reasons to conclude that the land comprising the two streets did not meet the description given in s 188(2)(a). First, they submitted that the land comprising the streets was not 91 Roads Act, s 41. 92 (2007) 155 LGERA 362 at 369 [12]. "acquired ... under this Part". Secondly, they submitted that the land comprising the streets was not acquired for a purpose other than the purpose of re-sale. The first point made by the appellants in this connection (that the land was not "acquired ... under this Part") is a point not previously taken in the litigation. The point is one of law. It is not a point which, if taken earlier, might have altered what evidence was adduced, or otherwise affected the course of the litigation93. The appellants should not now be precluded from taking the point. The land comprising the streets is not to be acquired under Pt 1 of Ch 8 of the LG Act. Section 187(1) of the LG Act provides: "Land that a council is authorised to acquire under this Part may be acquired by agreement or by compulsory process in accordance with the [Acquisition Act]." The Council proposes to acquire the two streets in question by compulsory process in accordance with the Acquisition Act. The power to do that derives only from s 7B of the Acquisition Act. The Council submitted that s 7B of the Acquisition Act "points beyond itself as the source of the power of compulsory acquisition by a council of its own land, and thus ss 186 and 187(1) of the [LG Act] are the source of the power". The answer to the submission is that while s 186 describes the purposes for which a council may acquire land, s 187(1) describes the methods by which it is to be acquired. The sole method of acquiring by compulsory process is that given by s 7B. It may be accepted that, as the Council pointed out, s 186(3) of the LG Act contemplates the acquisition, by a council, of "community land vested in a council". Section 186(3) provides that such an acquisition "does not discharge the land from any trusts, estates, interests, dedications, conditions, restrictions or covenants that affected the land or any part of the land immediately before that acquisition". A public road vested in a council, however, is not what the LG Act identifies in its Dictionary as "public land", and a public road is therefore not "community land"94. Section 186(3) of the LG Act thus has no application to either of Darcy Street or Church Street. Even accepting for the purposes of argument that s 186 of the LG Act authorises a council to acquire, from itself, what the LG Act identifies as community land, it does not follow that the 93 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; [1950] HCA 35; Coulton v Holcombe (1986) 162 CLR 1; [1986] HCA 33. 94 Local Government Act 1993 (NSW), s 26. Council's acquisition by compulsory process of public roads that are vested in it are acquisitions under Pt 1 of Ch 8 of the LG Act. Rather, each is an acquisition made under s 7B of the Acquisition Act, not an acquisition of the land comprising the relevant street under Pt 1 of Ch 8 of the LG Act. It is not necessary, in these circumstances, to decide whether the second argument advanced by the appellants about the application of s 188(2)(a) is right. It may be observed, however, that the appellants' argument that s 188(2)(a) is not engaged in relation to the acquisition of their land proceeded on the footing that the provision requires the identification of a single purpose as the relevant purpose of acquiring the "other land" which is part of, or adjoins or lies in the vicinity of, the subject land and is acquired at the same time as the subject land. That is, the argument assumed that s 188(2)(a) requires choosing between the acquisition of that other land being for the purpose of re-sale or "a purpose other than the purpose of re-sale". By contrast, the Council's arguments about the engagement of s 188(2)(a) assumed that an acquisition of the other land could be undertaken for more than one purpose and that s 188(2)(a) was engaged if one of the several purposes of that acquisition was a purpose other than the purpose of re-sale. Thus, the Council submitted that it was important to recognise that not all of the land which now comprises Church Street is to be acquired by Grocon; only a stratum beneath the surface is Trust Land which passes to or at the direction of Grocon. And the Council pointed out that part of Darcy Street (at Station Square) will ultimately remain in Council ownership. It followed, so the Council submitted, that a purpose of the acquisition of the two streets was a purpose other than transferring to Grocon those parts of the land which are to be dealt with in that way. Particular attention was directed to how s 188(2)(a) would apply in the case where the land that is to be acquired "forms part of ... other land acquired at the same time ... for a purpose other than the purpose of re-sale". This, in turn, was seen as directing attention to whether the word "land" was used, in the reference to "other land" in s 188(2)(a), as identifying a part of the terrestrial globe, or was used as referring not to a physical area but to a form of real property interest. But no matter which of those readings is to be preferred over the other, the more fundamental question of construction that is presently relevant is whether s 188(2)(a) requires identification of the purpose of acquisition of the other land, and classification of that purpose as either re-sale, or a purpose other than the purpose of re-sale. Deciding whether "land" is to be understood as a physical area or as a real property interest does not assist in resolving that more fundamental question. Section 188(2)(a) stands as an exception to the requirement of s 188(1) that the approval of the owner of "the land" is required "if it [the land] is being acquired for the purpose of re-sale". As noted earlier, it is not necessary to decide in these cases whether "the purpose of re-sale" that is mentioned in s 188(1) is to be understood as the "sole", the "dominant", or the "substantial" purpose in question. That is not necessary in these cases because the purpose of the acquisition of the appellants' land was to put the Council in a position to fulfil its obligations to Grocon by reselling the appellants' land to Grocon. But where, as is the case with both Darcy Street and Church Street, only part of the land is to be resold and part is to be retained by the Council, the better view may well be that the land comprising those streets is acquired for more than one purpose. The more natural meaning of s 188(2)(a) applied to such a case would appear to be that those streets, if they were "other land" acquired at the same time as the appellants' land, were each acquired for a purpose other than the purpose of re-sale. It is, however, not necessary to resolve these questions. It is sufficient to decide in these cases that neither Darcy Street nor Church Street is land that would be acquired at the same time as the appellants' land under Pt 1 of Ch 8 of the LG Act. Conclusion and orders Each appeal to this Court should be allowed with costs. Because the proposed acquisition notices given by the Council to Fazzolari and Mac's are no longer current, it is neither necessary nor appropriate to reinstate the injunctive orders made at first instance. It is appropriate however to restore the declarations that were made by Biscoe J. As the Council pointed out, the argument that neither Darcy Street nor Church Street is land that would be acquired at the same time as the appellants' land under Pt 1 of Ch 8 of the LG Act was not put in the courts below. Nonetheless, costs should follow the event not only in this Court but also in the courts below. It follows that in addition to the orders dealing with the appeals to this Court there should in each matter be the further consequential orders: Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 11 June 2008 and in their place order that paragraph 2 of the orders of the Land and Environment Court of New South Wales made on 28 September 2007 is set aside but the appeal to the Court of Appeal is otherwise dismissed with costs.
HIGH COURT OF AUSTRALIA AND PLAINTIFF THE COMMONWEALTH OF AUSTRALIA & ANOR DEFENDANTS Nicholas v The Commonwealth [2011] HCA 29 10 August 2011 ORDER Order that the question stated in the special case be answered as follows: Question: Is item 5 of Schedule 1 to the Military Justice (Interim Measures) Act (No 2) 2009 (Cth) a valid law of the Commonwealth Parliament? Answer: Yes. The plaintiff pay the defendants' costs. Representation B Levet with A B Petrie for the plaintiff (instructed by Kinghan & Associates) S J Gageler SC, Solicitor-General of the Commonwealth with S J Free for the first defendant (instructed by Australian Government Solicitor) Submitting appearance for the second defendant Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Constitutional law (Cth) – Judicial power of Commonwealth – Constitution, Ch III – Validity of laws – Plaintiff defence force member – Plaintiff convicted of disciplinary offences and sentenced to punishment by Australian Military Court ("AMC") established under Defence Force Discipline Act 1982 (Cth) ("Discipline Act") – Plaintiff subjected to punishment – High Court subsequently held invalid provisions of Discipline Act establishing AMC – Military Justice (Interim Measures) Act (No 2) 2009 (Cth) ("Interim Measures Act"), Sched 1, item 5 applied where AMC had imposed punishment to declare rights and liabilities of all persons to be same as if punishment properly imposed by general court-martial, subject to review under Sched 1, Pt 7 – Whether provisions of Interim Measures Act had prohibited features of bill of pains and penalties – Whether provisions invalid as contrary to Ch III. Words and phrases – "bill of pains and penalties", "usurpation of judicial power". Constitution, s 51(vi), Ch III. Defence Force Discipline Act 1982 (Cth), ss 27, Pt VIIIA. Military Justice (Interim Measures) Act (No 2) 2009 (Cth), Sched 1, items 3, 4, 5, FRENCH CJ, GUMMOW, HAYNE, CRENNAN, KIEFEL AND BELL JJ. From 1 January 2004 until 25 August 2008, the plaintiff was a commissioned officer in the Australian Army, holding the rank of Captain. Between 18 and 25 August 2008 he was tried by the Australian Military Court ("the AMC") on 11 charges under the Defence Force Discipline Act 1982 (Cth) ("the Discipline Act"). On 25 August 2008, he was convicted of four of those offences, two of obtaining a financial advantage contrary to s 135.2(1) of the Criminal Code (Cth) (as applied by s 61(3) of the Discipline Act), one of engaging in conduct tending and intended to pervert the course of justice and one of attempting to pervert the course of justice. He was sentenced to be reduced in rank to Lieutenant with seniority in that rank dating from 1 January 2006, to dismissal from the defence force effective on 19 September 2008 and to a severe reprimand. Orders were made that he pay certain amounts as reparation to the Commonwealth. On 26 August 2009, after the orders made by the AMC had taken effect, this Court declared1 that the provisions of Div 3 of Pt VII of the Discipline Act, which established the AMC, were invalid. In response to this decision, the Parliament enacted the Military Justice (Interim Measures) Act (No 2) 2009 (Cth) ("the Interim Measures No 2 Act"), the provisions of Pt 2 of Sched 1 to which Act apply with respect to certain punishments imposed by the AMC (including those imposed on the plaintiff). By an action brought in the original jurisdiction of this Court the plaintiff alleged that those provisions of the Interim Measures No 2 Act which "purport to give effect to punishments … and orders made by the [AMC] are invalid". He sought a declaration that the relevant provisions of the Interim Measures No 2 Act are invalid, together with declarations that the convictions recorded by the AMC against him are invalid, that the punishments imposed on him are invalid and that his dismissal from the defence force was invalid and of no effect. His central allegation was that the Interim Measures No 2 Act is a bill of pains and penalties and thus invalid as being contrary to Ch III of the Constitution. The second defendant, the Chief of the Defence Force, filed a submitting appearance. The plaintiff and the Commonwealth joined in stating a special case in which the following question was stated for the opinion of the Full Court: 1 Lane v Morrison (2009) 239 CLR 230; [2009] HCA 29. Crennan Bell "Is item 5 of Schedule 1 to the [Interim Measures No 2 Act] a valid law of the Commonwealth Parliament?" The special case was heard at the same time as the special case stated in Haskins v The Commonwealth2. The impugned provisions and the arguments advanced in support of the submission that the impugned provisions constituted a bill of pains and penalties are sufficiently recorded in the reasons given in Haskins. For the reasons given in Haskins, the question stated in the special case in this matter should be answered "Yes". The impugned provisions of the Interim Measures No 2 Act do not have the prohibited features of a bill of pains and penalties. The impugned provisions are not invalid as contrary to Ch III. The plaintiff must pay the costs of the special case. [2011] HCA 28. HEYDON J. The plaintiff, Paul Nicholas, seeks certain declarations against the first defendant, the Commonwealth of Australia, and the second defendant, the Chief of the Defence Force. The declarations include declarations that convictions recorded by the Australian Military Court against him, punishments imposed by the Australian Military Court on him, and his dismissal from the Australian Defence Force were invalid. He was convicted on two charges relating to the obtaining of financial advantage, and two charges relating to perverting the course of justice. Taken as a whole, the sentences were a reduction in rank, orders to pay reparation, a severe reprimand, and dismissal from the Defence Force. The circumstances relating to the plaintiff's claim are largely the same as those relating to the plaintiff in Haskins v The Commonwealth3, save that the plaintiff in that case lost his liberty for a time, and the plaintiff in this case has been dismissed. The Australian Military Court's convictions, punishments and orders would have been invalid but for the Military Justice (Interim Measures) Act (No 2) 2009 (Cth). However, for the reasons given in relation to the plaintiff in Haskins v The Commonwealth4, item 5 of Sched 1 to that Act is invalid. The question in the Special Case should be so answered. Some additional arguments were advanced for that outcome, but they need not be considered. The declarations which the plaintiff seeks should be made. The first defendant must pay the plaintiff's costs. [2011] HCA 28. [2011] HCA 28 at [95]-[113].
HIGH COURT OF AUSTRALIA Matter No B62/2005 AND APPELLANT STATE OF QUEENSLAND RESPONDENT Matter No B63/2005 APPELLANT AND STATE OF QUEENSLAND RESPONDENT Matter No B64/2005 APPELLANT AND STATE OF QUEENSLAND RESPONDENT Matter No B65/2005 AND APPELLANT STATE OF QUEENSLAND RESPONDENT Matter No B66/2005 AND APPELLANT STATE OF QUEENSLAND RESPONDENT Matter No B67/2005 AND APPELLANT STATE OF QUEENSLAND RESPONDENT Davison v State of Queensland, Gibson v State of Queensland, Girard v State of Queensland, Orr v State of Queensland, Yarrie v State of Queensland, Orr v State of Queensland [2006] HCA 21 17 May 2006 B62/2005, B63/2005, B64/2005, B65/2005, B66/2005, & B67/2005 In each matter: ORDER Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of Queensland made on 3 December 2004 and, in lieu thereof, order that the appeal to that Court be dismissed with costs. On appeal from the Supreme Court of Queensland Representation: R J Douglas SC with G R Mullins and M Horvath for the appellants (instructed M Grant-Taylor SC with K Philipson for the respondents instructed by Crown Solicitor for State of Queensland) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Davison v State of Queensland Limitation of actions – Personal injury – Personal Injuries Proceedings Act 2002 (Q) – Limitation of Actions Act 1974 (Q) – Appellants alleged serious physical and mental abuse suffered while in foster care under the supervision and care of the respondent – Application for extension of limitation period – Whether an applicant for leave to commence proceedings under s 43 of the Personal Injuries Proceedings Act 2002 (Q) must demonstrate a "reasonably arguable case for the granting of an extension" of time under s 31(2) of the Limitation of Actions Act 1974 (Q) – Whether evidence relied on by appellants established a prima facie case for extension of time under s 31(2). Statutory interpretation – Remedial legislation – Purposive approach – Provision for urgent interim relief – Personal Injuries Proceedings Act 2002 (Q), s 43. Limitation of Actions Act 1974 (Q), ss 30(1), 31(2). Personal Injuries Proceedings Act 2002 (Q), s 43. GUMMOW, HAYNE, HEYDON AND CRENNAN JJ. Each appellant1 wished to commence an action in tort in relation to abuse allegedly suffered as a child while in foster care and while under the supervision and care of the respondent, the State of Queensland. In relation to each, the limitation period expired. Each wished to obtain an order extending the limitation period pursuant to s 31(2) of the Limitation of Actions Act 1974 (Q), which provides: "(2) Where on application to a court by a person claiming to have a right of action to which this section applies, it appears to the court – that a material fact of a decisive character relating to the right of action was not within the means of knowledge of the applicant until a date after the commencement of the year last preceding the expiration of the period of limitation for the action; and that there is evidence to establish the right of action apart from a defence founded on the expiration of a period of limitation; the court may order that the period of limitation for the action be extended so that it expires at the end of 1 year after that date and thereupon, for the purposes of the action brought by the applicant in that court, the period of limitation is extended accordingly." The key terms in s 31(2) are defined in s 30(1) as follows: "(1) For the purposes of this section and sections 31, 32, 33 and 34 – the material facts relating to a right of action include the following – the fact of the occurrence of negligence, trespass, nuisance or breach of duty on which the right of action is founded; the identity of the person against whom the right of action lies; 1 Sarah Davison, Vanessa Fayne Jean Gibson, Stephen Girard, Jason Thomas Orr, Natasha Yarrie and Alexandra Jane Orr. Crennan (iii) the fact that the negligence, trespass, nuisance or breach of duty causes personal injury; the nature and extent of the personal injury so caused; the extent to which the personal injury is caused by the negligence, trespass, nuisance or breach of duty; (b) material facts relating to a right of action are of a decisive character if but only if a reasonable person knowing those facts and having taken the appropriate advice on those facts, would regard those facts as showing – that an action on the right of action would (apart from the effect of the expiration of a period of limitation) have a reasonable prospect of success and of resulting in an award of damages sufficient to justify the bringing of an action on the right of action; and that the person whose means of knowledge is in question ought in the person's own interests and taking the person's circumstances into account, to bring an action on the right of action; a fact is not within the means of knowledge of a person at a particular time if, but only if – the person does not know the fact at that time; and as far as the fact is able to be found out by the person – the person has taken all reasonable steps to find out the fact before that time." Each appellant wished to argue that "a material fact of a decisive character" became known to them on 18 June 2003, when the Brisbane Courier- Mail published an article suggesting that there had been widespread abuse of children in the care of the respondent. However, each had failed to comply with the preconditions for commencing proceedings created by the Personal Injuries Proceedings Act 2002 (Q) ("the Act"), particularly the requirements for service of timely and detailed notices of accident. Section 43 of the Act, which is in Ch 2, Pt 1, provides in part: Crennan "(1) The court, on application by a claimant, may give leave to the claimant to start a proceeding in the court for damages based on a injury despite noncompliance with this part if the court is satisfied there is an urgent need to start the proceeding. for personal liability The order giving leave to start the proceeding may be made on conditions the court considers necessary or appropriate having regard to the particular circumstances of the case. (3) However, if leave is given, the proceeding started by leave is stayed until the claimant complies with this part or the proceeding is discontinued or otherwise ends."2 Each appellant made an application to the Supreme Court of Queensland (Douglas J) for leave under s 43 well before the end of the one year period referred to in s 31(2) of the Limitation of Actions Act. Douglas J made orders refusing the applications for leave on the ground that there was no urgent need to start the proceedings3. Appeals were brought against those orders. More than one month after the Queensland Court of Appeal heard those appeals, nine days before it dismissed them4, and two days before the latest date to which the limitation period could be extended, Holmes J heard and granted further applications by the appellants for leave under s 435. After the orders of Holmes J were made, proceedings were commenced and applications to extend time under s 31(2) were filed. They have not been heard, because appeals were brought by the respondent against Holmes J's orders, and those appeals were allowed by the Court of Appeal (de Jersey CJ and Chesterman J, McMurdo P dissenting)6. The majority reasoning rested on the proposition, with which McMurdo P disagreed, that an applicant seeking a s 43 order after the expiration of the ordinary limitation period must demonstrate a reasonably arguable case for the granting of an extension to the limitation period. 2 Some other jurisdictions have legislation equivalent to the Act, and in particular to s 43. See Civil Law (Wrongs) Act 2002 (ACT), s 79; Personal Injuries (Civil Claims) Act 2003 (NT), s 7(2). 3 Orr v State of Queensland [2003] QSC 463. 4 SG v State of Queensland [2004] QCA 215. 5 Girard v State of Queensland [2004] QSC 236. 6 SG v State of Queensland [2004] QCA 461. Crennan The appellants have brought appeals to this Court against the allowing of the respondent's appeals to the Court of Appeal. The appellants' appeals should be allowed. Statutory background Before the Act came into force on 18 June 2002, with its requirement for various steps to be taken before proceedings could be commenced, a solicitor consulted by a client whose cause of action was subject to a limitation period which was about to expire, or which had expired and in respect of which the maximum period for extension under s 31(2) of the Limitation of Actions Act was about to expire, could commence proceedings by filing a claim and statement of claim. This would stop the limitation period running, and, if it had expired, would stop the one year period referred to in s 31(2) from running. If the defendant then chose to raise a limitation defence and apply for summary judgment, the plaintiff could make a cross-application for extension of the limitation period. The issues raised by s 31(2) could then be examined with appropriate care. The introduction of Ch 2, Pt 1 of the Act was an important and drastic inroad into the common law rights of citizens. The effect of the preconditions for commencing proceedings created by Ch 2, Pt 1, in cases where either the limitation period or the one year period in s 31(2) was about to expire, was to create the potential for harsh results where plaintiffs or their legal advisers had failed to realise the significance of the need for compliance with Ch 2, Pt 1. The function of s 43 is to avert these potentially harsh results, and this has relevance to the construction of s 43. Court of Appeal's reasoning One ground of appeal to the Court of Appeal against Holmes J's orders was that the application to her was an abuse of process, in view of the failure of the earlier application to Douglas J. However, this ground was abandoned in the Court of Appeal7 and not renewed in this Court. 7 SG v State of Queensland [2004] QCA 461 at [15]. The respondent took no point in this Court about the failure of the appellants to challenge the dismissal by the Court of Appeal of appeals against Douglas J's refusal of their s 43 applications. Crennan In allowing the appeal, the Court of Appeal majority appeared to differ from the primary judge in two respects. First, the Court of Appeal majority said that leave could not be extended under s 43 in aid of an application to extend time under s 31(2) unless the claimant for leave could demonstrate that there was "a reasonably arguable case for the granting of an extension" under s 31(2)8. The Court of Appeal majority did not explicitly say whether the need to show a reasonably arguable case was a precondition to the existence of a power to grant leave under s 43 or a factor going to the discretionary exercise of that power. Their language suggests it is not the latter and hence it must be the former, because a factor which supposedly goes to discretion but which requires the discretion always to be exercised one way is not in truth a discretionary factor. Although the Court of Appeal majority did not explicitly say that the primary judge was wrong in law for not applying the test stated by the Court of Appeal, it is clear that Her Honour did not do so. Secondly, the Court of Appeal majority said that the appellants' application should have been refused on the ground that "urgency" was not established. In form, this appears to be a conclusion that the primary judge erred on a point of fact. It will be seen below, however, that in truth this contention that "urgency" was not established is a reformulation and repetition of the first ground. Issues on the appeal Counsel for the appellants conceded that if there were no prospect whatever of obtaining an extension of time under s 31(2), then it would be right not to grant leave under s 43 because to do so would be futile. This concession corresponded with the opinion of McMurdo P9. McMurdo P also suggested that applicants under s 43 might have to demonstrate "real, not merely fanciful, prospects of mounting a reasonably arguable case for the granting of an extension of the limitation period" under s 31(2), "even though they had not then obtained all the material necessary to succeed in such an application."10 It is not necessary to consider in this appeal how great a degree of weakness in a proposed s 31(2) application must be found before leave will be refused under s 43. The question was not argued. That is because the primary approach of the respondent was not to defend the test employed by the Court of 8 SG v State of Queensland [2004] QCA 461 at [22]. 9 SG v State of Queensland [2004] QCA 461 at [33]. 10 SG v State of Queensland [2004] QCA 461 at [38]. Crennan Appeal majority, but rather to contend that the evidence tendered by the appellants revealed that they had no prospects of success in obtaining an extension of time under s 31(2). Before turning to the respondent's argument, however, it is necessary, in view of its importance, to examine the Court of Appeal majority's construction of s 43, despite the failure of the respondent to act as a contradictor in relation to the appellants' arguments on that subject11. Construction of s 43 The appellants submitted that to require of s 43 claimants for leave to initiate proceedings which are about to be statute barred and in relation to which an extension of time may be sought under s 31(2), that they show a reasonably arguable case for the granting of an extension, was to read words into s 43 in an impermissible manner. That submission is correct for the following reasons. The Court of Appeal majority said that s 43 was not to be construed "restrictively" and that the s 43 discretion had an "unfettered" character12. However, the requirement for a reasonably arguable case does restrict and fetter discretion. There is no support for this outcome in the express statutory language or the subject-matter, scope and purpose of the legislation. If a claimant under s 43 has to demonstrate a reasonably arguable case for extension under s 31(2), it would seem to follow from that premise that the claimant is obliged to demonstrate a reasonably arguable case on every issue relevant to the proceeding for the starting of which leave is required. This conclusion is improbable in relation to legislation which operates where there is an urgent need to start proceedings, and the improbability of the conclusion falsifies the premise. The function of s 43 may be explained by borrowing some well-known words which Dixon J used in another context – to prevent litigants being 11 It may be noted that the respondent conceded that, assuming the preconditions for the exercise of the power to grant leave under s 43 were satisfied, there was no discretionary factor pointing against the grant of leave in the present case. 12 SG v State of Queensland [2004] QCA 461 at [20]-[21]. They relied on the consideration given by the Court of Appeal to a different aspect of s 43 in Gillam v State of Queensland [2004] 2 Qd R 251. Crennan deprived of the right to submit real and genuine controversies to the determination of the courts by the due procedure appropriate for the purpose13. Section 43 will no doubt operate in many circumstances outside the intersection between Ch 2, Pt 1 and the limitation period exemplified by this case, but the case does illustrate an important potential field of its operation. In the present case, the construction propounded by the Court of Appeal majority prevents determination of the nature and lawfulness of the respondent's conduct in relation to the appellants while they were children – on the appellants' case, conduct of a grave kind. It also prevents determination of the preliminary potential controversy over whether the limitation period should be extended under s 31(2). Even if there were some verbal foothold in the legislation for the construction adopted by the Court of Appeal majority, the context points strongly against that construction in the present field of application of s 43. Section 31(2), read with its companion provision s 31(1), bristles with difficulties of construction and application14. The court might often find the task of assessing whether there is a reasonably arguable case for the granting of an extension under s 31(2) extremely difficult where it has to be performed in the course of a necessarily hurried s 43 application. The construction stated by the Court of Appeal majority perhaps rests on a fear that injustice for defendants might arise from too free a grant of leave under s 43. That risk is reduced by the capacity of the court under s 43(2) to impose conditions which are necessary or appropriate in the particular circumstances, and by the stay of the proceeding which has been started by leave until either the claimant complies with Ch 2, Pt 1 or the proceeding ends. In so far as the Court of Appeal majority contended, independently of the question of construction just discussed, that there was not an urgent need to start the proceeding, the contention must fail if it is considered simply as a matter of dates: the expiration of the one year period stipulated in the tailpiece to s 31(2) was imminent. However, the majority saw the issue of whether there was urgency in a special sense – as being integrally linked with the issue of whether the s 31(2) application was reasonably arguable. This flows from the fact that the majority held that "urgency" was not established "essentially for the reasons expressed by" Douglas J15. His Honour said: 13 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 92. 14 State of Queensland v Stephenson [2006] HCA 20. 15 SG v State of Queensland [2004] QCA 461 at [24]. Crennan "... I am not satisfied that there is an urgent need to start the proceeding under s 43. Either the proceeding is out of time, in which case there is no urgency shown, or it may become a proceeding which can be proceeded with successfully if leave is given under section 31 of the Limitation of Actions Act to extend the period of limitation, and I just cannot predict on the material available to me whether that will happen and whether the limitation period will be extended to any particular date. At most, all that the applicant ... can show is that he is investigating whether there is evidence to warrant an extension of the period of limitation." This Court does not have before it the material which Douglas J had before him. So far as his Honour viewed the question as whether he could predict that the limitation period would be extended, he appears to have adopted a construction of s 43 which is even stricter than that of the Court of Appeal majority, and which must be rejected for the same reasons. Satisfactoriness of appellants' affidavit evidence The primary argument advanced by the respondent was that the evidence relied on by the appellants revealed the absence of any case for an extension of time under s 31(2), and also showed that even if one of the tests referred to by McMurdo P (dissenting) were applied, namely, that leave should be refused if it would be "futile" to grant it, that test would be satisfied16. The evidence to which the respondent pointed was in a series of affidavits sworn by the solicitor for the appellants on 11 June 2004 and filed in each application for leave under s 43. Paragraph 25 stated: "25. I am advised by the Applicant and verily believe that although the Applicant knew he had been abused, he did not know he could do anything about it or that the Department be at fault. After reading the article in the Courier Mail on 18 June 2003 he realised he may have a claim against the Respondent and that he should investigate. Thereafter he contacted Bravehearts who put him in contact with Solicitors." 16 This argument does not appear in the transcript of the respondent's submissions to Holmes J, or the respondent's written submissions to the Court of Appeal, and if it was advanced orally, it left no trace in the Court of Appeal's reasons. Crennan The solicitor then exhibited the article. Paragraph 26 stated: "It appears the most likely date of material fact is 18 June 2003 however we cannot be certain without further enquiry and medical evidence." Paragraph 27 stated: "27. The Applicant may have therefore only have become aware on 18 June 2003 of the following:– that the abuse carried out by his foster family and other similar families was not only perpetrated against other children but was much more widespread than the applicant has believed at the time of the abuse or since; the applicant has always believed that he was the only victim of abuse perpetrated by a member(s) of Foster Families; notwithstanding any actual knowledge of the abuse by the respondent it is also submitted that as a result of the extensive abuse now uncovered by Queensland Police Service and CMC enquiry and which occurred over a long period of time that it is more likely to have been suspected or known about by the respondent at the time of the individual abuses and since; however, until 18 June 2003 the applicant was unaware of this; the applicant was not aware that a criminal investigation had taken place until on or after 18 June 2003." The respondent did not complain about the hearsay character of the evidence. The respondent cast doubt on whether sub-pars (a)-(d) of par 27 were material facts. That doubt is without foundation. If the abuse of children in foster care were extensive, as par 27(c) says, it would be more likely that the respondent would have suspected it or known about it. If it did suspect it or know about it, the prospects of establishing a breach of a duty of care would be improved. That supports the existence of a "material [fact] relating to a right of action" of the kind defined in s 30(1)(a) of the Limitation of Actions Act. The respondent then submitted that the opening words of par 27 made it evident that neither the appellants nor their solicitor could say when the facts came within the appellants' means of knowledge; that it could not be expected that this state of ignorance would cease; and hence that the appellants would never be able to demonstrate a prospect of establishing that a material fact of a decisive character relating to the right of action was not within their means of knowledge until the date identified in s 31(2). Crennan These submissions must be rejected. Read together, pars 25-27, while cautiously drafted, do demonstrate some prospect of establishing at the hearing of the s 31(2) application that it was not until 18 June 2003 that a material fact relating to the right of action (the respondent's negligence) which was of a "decisive character" within the meaning of s 30(1)(b) of the Limitation of Actions Act was within their means of knowledge. They say, in short, that before 18 June 2003 the appellants did not realise that the respondent might be at fault. As the appellants submitted, s 31(2) applications often involve the filing of extensive affidavit material on questions of duty, breach, causation and quantum, and cross-examination on the affidavits. Evidence of that kind goes not only to the issue referred to in s 31(2)(a) (which leads back into questions about the existence of material facts under s 30(1)(a), questions about whether they were of a decisive character under s 30(1)(b), and questions about means of knowledge under s 30(1)(c)), but also to questions of whether there is evidence to establish the right of action under s 31(2)(b). Paragraph 26 of the affidavit can be seen, particularly in the light of other evidence filed by the appellants as to the extent of the inquiries they had in train in relation to s 31(2), as an elliptical reference to s 31(2)(a) issues. To say that the appellants and their advisers cannot be certain about the date referred to in s 31(2)(a) without further inquiry and medical evidence is no more than a demonstration of prudence. When par 26 is read with the opening words of par 27, it cannot be said that it was evident that neither the appellants nor the solicitor could say, or would ever be able to say, what the s 31(2)(a) date was. Holmes J was right to say that there was a strong basis for an argument that a material fact of a decisive character became known to the appellants on 18 June 2003. Orders Since the construction advanced by the Court of Appeal majority is unsound, and since the error attributed by the Court of Appeal majority to Holmes J in relation to "urgency" does not exist, her Honour's orders should be restored. Sarah Davison v State of Queensland (B62/2005) The appeal is allowed with costs. The orders of the Court of Appeal are set aside and in lieu thereof it is ordered that the appeal to that Court be dismissed with costs. Vanessa Fayne Jean Gibson (B63/2005). The appeal is allowed with costs. Crennan The orders of the Court of Appeal are set aside and in lieu thereof it is ordered that the appeal to that Court be dismissed with costs. The appeal is allowed with costs. The orders of the Court of Appeal are set aside and in lieu thereof it is ordered that the appeal to that Court be dismissed with costs. The appeal is allowed with costs. The orders of the Court of Appeal are set aside and in lieu thereof it is ordered that the appeal to that Court be dismissed with costs. The appeal is allowed with costs. The orders of the Court of Appeal are set aside and in lieu thereof it is ordered that the appeal to that Court be dismissed with costs. The appeal is allowed with costs. The orders of the Court of Appeal are set aside and in lieu thereof it is ordered that the appeal to that Court be dismissed with costs. Kirby KIRBY J. Six appeals are before this Court. They raise common issues. They come from a majority decision17 of the Queensland Court of Appeal18. Primarily, they concern the meaning and application of the Personal Injuries Proceedings Act 2002 (Q) ("the Personal Injuries Act"). The provisions of s 43 of the Personal Injuries Act, so far as relevant, are set out in the reasons of Gummow, Hayne, Heydon and Crennan JJ ("the joint reasons")19. Also appearing there are provisions of the Limitation of Actions Act 1974 (Q) ("the Limitations Act") which govern the rights of the appellants. They are otherwise well out of time to bring proceedings against the State of Queensland ("the State") for abuse which they allege they suffered, as children, when in foster care or otherwise under the responsibility of the State20. As appears in the joint reasons, there are two ways of interpreting s 43 of the Personal Injuries Act. The first is the way preferred by the majority in the Court of Appeal. This holds that, to secure leave under s 43, in order to start a proceeding for damages notwithstanding non-compliance with the Personal Injuries Act, it is necessary for a claimant to establish affirmatively that he or she has "a reasonably arguable case for the granting of an extension" under s 31(2) of the Limitations Act21. The other meaning, preferred by McMurdo P22 in her dissent in the Court of Appeal (and by Holmes J at first instance23) is that, by its language and purpose, the power afforded by s 43 of the Personal Injuries Act is addressed to responding to an urgent need to start proceedings because of a danger, otherwise arising, of the descent of a limitation bar. In such circumstances, the provision is no more than a procedural facility that may be granted on terms to preserve the status quo24. At most, the prospect of ultimately securing an order extending the limitation period under the Limitations Act would be relevant if a court, considering the application under s 43, were convinced that the prospect of 17 de Jersey CJ and Chesterman J; McMurdo P dissenting. 18 SG v State of Queensland [2004] QCA 461. 19 Joint reasons at [2]. 20 Joint reasons at [1]. 21 [2004] QCA 461 at [22]. 22 [2004] QCA 461 at [37]-[38]. 23 Girard v State of Queensland [2004] QSC 236. 24 Personal Injuries Act, s 43(2) and (3). Kirby mounting an arguable case for such an extension was fanciful25 or if it appeared that the application amounted to an abuse of process26. In my view, the better construction was that adopted by the primary judge and McMurdo P in the Court of Appeal. However, as is often the case, by the time disputed questions of statutory construction reach this Court, the point is not unarguable27. There are persuasive contentions both ways. To arrive at the preferable, and therefore the correct, interpretation of s 43, it is necessary to evaluate the arguments for and against the competing approaches. Arguments favouring the State's position Several considerations favour the approach adopted by the majority in the Court of Appeal. First, although it is contemplated that an order under s 43(1) of the Personal Injuries Act will be made on an interlocutory basis, subject to any conditions imposed pursuant to s 43(2) and subject also to a stay as contemplated by s 43(3) of that Act, the grant of leave to start proceedings that might not otherwise be lawfully commenced, is clearly a serious step. It disturbs the entitlement of a party to be free of the burdens, worries and costs of litigation. The law abhors judicial orders (even of a temporary and conditional kind) which disturb the legal rights of parties without good reasons being demonstrated for making them. Thus, the necessity to demonstrate the existence of a "reasonably arguable" foundation for the granting of leave might be viewed as no more than affirmation of the common requirement that a litigant, seeking a privilege not otherwise belonging to it, must demonstrate, to a reasonable standard, the utility and justifiability of granting that benefit. Such an approach is not unknown in judicial procedure. Where a litigant has become out of time and seeks leave to file a defence, he or she will often be required to justify an order to overcome the time default by, for example, demonstrating that he or she has a real defence28. This is sometimes expressed as the requirement to show a 25 [2004] QCA 461 at [33] per McMurdo P. 26 Girard [2004] QSC 236 at 7 per Holmes J. 27 News Limited v South Sydney District Rugby League Football Club Limited (2003) 215 CLR 563 at 580 [42]. 28 Vacuum Oil Pty Co Ltd v Stockdale (1942) 42 SR (NSW) 239 at 243-244; Re Cameron Smith; Ex parte Vigilant Finance (NSW) Pty Ltd [1964] NSWR 1282 at 1285; Garrard v Email Furniture Pty Ltd (1993) 32 NSWLR 662 at 671; Evans v Bartlam [1937] AC 473 at 480; Grimshaw v Dunbar [1953] 1 QB 408 at 415. Kirby defence on the merits. Applications for such leave might otherwise easily become a means of spinning out litigation, without any ultimate prospect of success and, in the meantime, imposing unreasonable burdens on the opposing party. Secondly, the foregoing considerations may have special relevance where the propounded "start [of] the proceeding[s]", claimed pursuant to s 43(1) of the Personal Injuries Act, involves the commencement of proceedings that are otherwise barred by a limitation statute. Until the appellants in the present case could secure orders that "the period of limitation for the action be extended", in accordance with s 31(2) of the Limitations Act, they are out of time. One objective of limitation statutes is to spare potential defendants of having to live with the burden of a legal action indefinitely where a potential claimant has not pursued his or her remedies in a timely fashion. Old claims impose special burdens on parties obliged to defend them. Parties conducting their affairs are ordinarily entitled to predict when they can regard potential actions as stale and expired. The community has a general interest in the prompt commencement of proceedings and in the finality of contested rights and obligations, given the injustices that can attend long delayed claims29. In such circumstances, where the propounded "urgency" to start the proceedings involves the hypothesis that an extension of the period of limitation for the bringing of the action will be granted, proof that this is a reasonable hypothesis is, in one sense, inherent in the exercise of the grant of leave under s 43(1) of the Personal Injuries Act. Thirdly, the State put this last submission in terms (accepted by the majority of the Court of Appeal) of the language of s 43(1) of the Personal Injuries Act. Unless it could be shown that the appellants enjoyed, as a matter of fact and law, "a reasonably arguable case for the granting of an extension" the precondition to the utility and urgency for the order under s 43(1) would not be made out. On this view, there could only be "an urgent need to start the proceeding" if "the proceeding" so envisaged were shown to be "reasonably arguable". If, at the time the applications under s 43(1) of the Personal Injuries Act were made, the appellants could not show this, it would follow that the appellants could not truly demonstrate "an urgent need to start the proceeding." The very "urgency" and the "need", upon this view, postulates the demonstrable viability of "the proceeding." The majority in the Court of Appeal, and a judge at first instance who had earlier rejected similar interlocutory applications for grants of leave under s 43(1) of the Personal Injuries Act (Douglas J30) embraced this approach. It was one 29 McGee and Scanlan, "Judicial attitudes to limitation", (2005) 24 Civil Justice Quarterly 460 at 460-461. 30 Orr v State of Queensland [2003] QSC 463. Kirby that they regarded as inherent in the provision of leave for "an urgent need to start the proceeding." Absent demonstrated viability, such a "need", particularly an "urgent need", was unproved. Fourthly, the State contested (correctly in my view) the repeated suggestions of the appellants that the discretion conferred on the primary judge (relevantly Holmes J in the second application under s 43) was "unfettered". Support for such a categorisation of the power in s 43 of the Personal Injuries Act appears in some of the reasoning in the Court of Appeal in this case31 and in an earlier decision on the section32. However, no discretion granted by statute is absolutely unfettered33. The applicable law may not contain express qualifications, limitations or restrictions. But it remains for a repository of statutory power always to exercise that power in accordance with the language of the grant, and so as to achieve the purposes of the statutory provision. The State's submission to this effect was clearly right. To the extent that the appellants rested their resistance to disturbance of the order Holmes J made under s 43 of the Personal Injuries Act upon the suggestion that her Honour's discretion was "unfettered" or "untrammelled"34, their argument should be rejected. However, this analysis leaves to be ascertained the ambit of the requirements imposed on the exercise of the power by the Personal Injuries Act. The appellants' preferable construction Whilst I accept that establishment of a reasonably arguable case (and thus in a matter of the present kind of a reasonably arguable entitlement to an extension of the period of limitation) is a possible interpretation of s 43 of the Personal Injuries Act), I do not consider it to be the preferable construction of the section. First, the language of s 43(1) of the Personal Injuries Act does not spell out, in terms, a requirement that leave should not be granted unless the claimant demonstrates a reasonably arguable case for an extension under the Limitations Act. To make good that precondition, it is necessary to derive it, by implication, 31 [2004] QCA 461 at [21] per de Jersey CJ. 32 Gillam v State of Queensland [2004] 2 Qd R 251 at 258 [23]. 33 Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 503-504 [70] per Callinan J and myself; Neat Domestic Trading v AWB Ltd (2003) 216 CLR 277 at 34 [2005] HCATrans 1006 at 281. Kirby from the language and purpose of s 43(1), read with other applicable legislation, such as that providing for an extension of the period of limitation where "the proceeding" could otherwise not be successfully maintained. Secondly, s 43 is a remedial provision35. It is designed to permit a party to start a proceeding who is not otherwise entitled to do so. It thus contemplates an exceptional facility. Clearly, it does so for a purpose protective of the rights of the party seeking to do so, so that such party will not lose possible rights by reason of any further delay in commencing the proceedings. It is normal for remedial provisions of legislation to be given a broad, and not a narrow or restricted, interpretation36. This is especially so where the beneficial provision in question has been enacted to protect the access of a party to the courts so as to vindicate claims to legal rights before those courts37 and to prevent such access from being lost by the descent of a limitation bar38. Moreover, the settled approach to the construction of legislation, expressed by this Court over many years39, is one that endeavours to give effect to the purpose of a legislative prescription, deriving that purpose from the language and structure of the legislation and any available supplementary sources. In the present case, the purpose of s 43 is, relevantly, to permit the Court to deal with urgent circumstances by the provision of what is, effectively, interim relief granted on conditions designed to do no more than to prevent any further detrimental running of time that might result from additional delay in the commencement of proceedings. Thirdly, the foregoing arguments for affording the language of s 43 of the Personal Injuries Act a broad and beneficial construction are reinforced when regard is had to considerations implied in the language of the section. Section 43(1) requires that the claimant, seeking leave, must secure it from "[t]he court". Of itself, this affords a protection to the party affected by the grant of leave, but only in terms of the stated conditions for its exercise. As stated, this is no more than the existence of "an urgent need to start the proceeding." The focus, 35 See State of Queensland v Stephenson [2006] HCA 20. 36 See, eg, Bull v Attorney-General for New South Wales (1913) 17 CLR 370 at 384; Khoury v Government Insurance Office (NSW) (1984) 165 CLR 622 at 638; SG [2004] QCA 461 at [33] per McMurdo P. 37 Magrath v Goldsbrough, Mort & Co Ltd (1932) 47 CLR 121 at 134. 38 Cf Brakespeare v The Northern Assurance Co Ltd (1959) 101 CLR 661 at 668. 39 See, eg, Bropho v Western Australia (1990) 171 CLR 1 at 20. Kirby expressed in the statute, is therefore upon procedural urgency. The statutory language goes no further. The need for care in the importation of other preconditions was correctly explained by Jerrard JA in Gillam40. In that case, his Honour (with the agreement of Dutney J and Philippides J) rejected an attempt to import into s 43 of the Personal Injuries Act an implication obliging the claimant, seeking the urgent leave there provided, to demonstrate a "reasonable excuse for delay". Addressing that submission, which is analogous to the construction favoured by the majority of the Court of Appeal in this case, Jerrard JA said41: "That submission must be rejected for a number of reasons. Section 43 contains no restrictions on the discretion it grants, and certainly none requiring the court be satisfied a reasonable excuse exists for delay or other non-compliance with pt 1 of ch 2 of the [Personal Injuries Act], which part contains s 9 to s 43. Further, s 43(3) contemplates the making of orders granting leave to claimants to commence proceedings when that may ultimately prove a futile step, since the section envisages leave being given in proceedings which are then stayed and ultimately discontinued. Next, some claimants may not know whether they have a reasonable excuse for delay". Fourthly, the last observation suggests a critical reason why the construction urged by the State, and adopted by the majority in the Court of Appeal, should not be accepted. To accept it would be to undermine the achievement of the expressed purpose of s 43. By its terms, that section is addressed to interim relief designed to hold the status quo for an identified period. It is designed to do so in urgent circumstances. To impose as a precondition for the provision of such urgent relief the obligation to prove a reasonably arguable case for an order for the extension of the period of limitation under the Limitations Act, would risk frustrating or defeating the object of s 43. Historically, before the enactment of the Personal Injuries Act, it had been possible in Queensland (as in other jurisdictions) simply to file a statement of claim (previously a writ of summons). That initiative, without more, would then typically stop time running. Applications for an extension of time under provisions such as those in the Limitations Act could then be made without the pressure of the risk of the descent of a limitation bar, either on the cause of action itself or on an application for extension of the period of limitation for bringing an action. The enactment of the Personal Injuries Act, which was retrospective in 40 [2004] 2 Qd R 251 at 258 [23]. 41 [2004] 2 Qd R 251 at 258 [23]. Kirby its operation42, terminated this more leisurely state of procedural affairs. It introduced various restrictions and time limits, presenting a statutory obstacle course to be negotiated by a party wishing to vindicate a claim in court. Because this is the context in which s 43 of the Act has been enacted, it suggests the manner in which the section should be construed. A construction that upholds the facility of urgent relief is to be preferred to one that would endanger, or defeat, the grant of such relief in circumstances arguably urgent. Fifthly, an added reason for adopting this approach to s 43 of the Personal Injuries Act is the highly complex nature of the law applicable to the provision of orders for extensions of a period of limitation under the Limitations Act. The law in question, copied in Queensland as in other Australian States from amendments to limitations law first enacted in England43, has given rise to much Apart from the law, the facts usual to many cases arising under applications for orders to extend the limitation period are typically complicated by many features of such applications, including the vulnerability, disadvantage and other personal characteristics of claimants45. To accept, as a precondition to the provision of the urgent relief for which s 43 of the Personal Injuries Act provides, an obligation in the claimant to establish a reasonably arguable case that extension of the limitation period will be ordered would not only impose, in many instances, a burden difficult or impossible to discharge in an application which, of its nature, is addressed to allegedly urgent circumstances. It would also risk shifting the contest about that question from the proper time when, and venue where, it is presented for determination. It would divert a proceeding essentially concerned with an "urgent need", into a proceeding likely to frustrate, 42 Section 6(1). 43 See McGee and Scanlan, "Judicial attitudes to limitation", (2005) 25 Civil Justice Quarterly 460 at 470 with reference to the report of the Committee on Limitation of Actions in Personal Injury, (1974) Cmnd 1829. 44 See, eg, Morgan, "Limitation and Discretion – Procedural Reform and Substantive Effect", (1982) 1 Civil Justice Quarterly 109; Jones, "Latent Damage – Squaring the Circle?", (1985) 48 Modern Law Review 564; McGee, "A Critical Analysis of the English Law of Limitation Periods", (1990) 9 Civil Justice Quarterly 366; Rogers, "Limitation and intentional torts", (1993) 143 New Law Journal 258; Jones, "Accidental Harm, Intentional Harm and Limitation", (1994) 110 Law Quarterly Review 31. 45 Adams v Bracknell Forest BC [2005] 1 AC 76 at 100 [91] per Baroness Hale of Richmond. See McGee and Scanlan, "Judicial attitudes to limitation", (2005) 24 Civil Justice Quarterly 460 at 466, 477. Kirby or defeat, a timely response to such need. This cannot be what Parliament meant by enacting s 43(1). If the law abhors futility, it is especially reluctant to accept futility in a provision enacted by Parliament for particular and limited purposes. Sixthly, nothing that is done by the provision of leave under s 43 of the Personal Injuries Act to start a proceeding alters, in the slightest, the ultimate disposition of the application that may then be necessary for an order for the extension of the period of limitation. The grant of leave under s 43(1) does not advance the proceeding substantively until any necessary order is made extending the period of limitation. The grant of leave outside a limitation period, if that it be, does not overcome any available limitation defence46. It merely suspends the running of time that would have occurred had the proceeding not been started at all. Seventhly, the imposition of procedural safeguards, as contemplated by s 43(2) of the Personal Injuries Act, and compliance otherwise with the provisions of the Act as contemplated by s 43(3) (with the prospect of revocation of leave if such conditions and compliance are not forthcoming), mean that abuse of the leave for which s 43(1) provides can be quickly, and effectively, dealt with. This fact was acknowledged by Holmes J when her Honour made it clear that the leave provided was conditional on the appellants' seeking orders for an extension of the limitation period in applications filed and served within an indicated period after the date of her Honour's orders. The orders subsequently made by Holmes J established a clear timetable for the filing and serving of the appellants' applications; for the return of such applications before the court; and for the personal swearing by each of the appellants "to the issue of when ... and the circumstances under which, a material fact or facts of a decisive character relating to [the] cause of action against the respondent was first within [his or her] means of knowledge". These were the kind of conditions that s 43 of the Personal Injuries Act contemplated. In the events that occurred, Holmes J's timetable was interrupted by the appeal to the Court of Appeal47. The orders were vacated when the Court of Appeal, by majority, substituted its own orders dismissing each appellant's application under s 43. Had such orders not been made, the orders of Holmes J would have quickly brought the proceedings to a consideration of the extension of the limitation bar. But they would have done so in the proper place and at the proper time for decisions on such questions. 46 SG [2004] QCA 461 at [16]-[21], [33]. 47 Joint reasons at [4]. Kirby Conclusion Once it is accepted that the majority of the Court of Appeal applied an incorrect test for the grant or refusal of leave under s 43 of the Personal Injuries Act, and imposed an inapplicable precondition that the appellants must prove a "reasonably arguable case for the granting of an extension" under s 31(2) of the Limitations Act, the judgment of the Court of Appeal cannot stand. The State filed no notice of contention, seeking to uphold the Court of Appeal's orders on a different basis. However, it did submit orally that, even if the test of McMurdo P, as to the prospective "futility" of the appellants' proceedings, were applied, the State was entitled to hold the orders of the Court of Appeal. In expressing the very clear case in which, where urgent need to start the proceeding is otherwise demonstrated, leave might be refused under s 43(1) by reference to futility, McMurdo P could not have meant a futility discovered only following a full exploration of the merits of the application for orders that the periods of limitation for the proposed actions be extended to show "a reasonably arguable case" for the extension. In some, rare, cases it will be plain, and easily demonstrable in a proceeding necessarily urgent and abbreviated, that the proceeding for which s 43(1) leave is sought is bound to fail. In such circumstances alone, the focus of attention in the court to which the application is made under s 43(1) of the Personal Injuries Act would shift from the urgent need to preserve the status quo to the pointlessness of providing any relief in the particular circumstances of the case. For the reasons expressed in her minority opinion in the Court of Appeal, McMurdo P was correct to conclude that the present was not a case where "futility" of this kind was made out48. In her Honour's view, there had been an arguable advance in the preparation of the appellants' cases for the orders they would seek for the extension of the respective limitation periods applicable to those cases. This was affirmed by the appellants' solicitor, notwithstanding the acknowledged difficulties of securing the appellants themselves. Moreover, in the opinion of McMurdo P, other material before Holmes J demonstrated the genuine attempts that had been made by the appellants to gather materials in order to advance their respective claims for limitation extensions. And, as McMurdo P put it49: instructions from "Most significantly, the material, unlike that before the judge in the first application, established urgency in that the date one year after, at least 48 [2004] QCA 461 at [37]. 49 [2004] QCA 461 at [37] (footnote omitted). Kirby arguably, some material facts of a decisive character became known to the [appellants] through the [newspaper] article was about to expire. Without the order sought under s 43 [of the Personal Injuries Act] … even if the anticipated applications for an extension of the limitation period were successful, the [appellants] could never commence their claims against the [State]." Unless Holmes J was shown to have applied an incorrect test for the grant of leave under s 43(1) of the Personal Injuries Act, the Court of Appeal was not warranted to disturb her Honour's discretionary orders50. The State made it clear that it raised no contest to her Honour's grant of leave because of the hearsay character of the appellants' solicitor's affidavit evidence51; the failure of the appellants to pursue any appeal to this Court from the Court of Appeal's separate confirmation of the order of Douglas J52; or on any other unstated discretionary ground53. It follows that the Court of Appeal's disturbance of the orders of Holmes J was erroneous. The grant of leave and the conditions imposed by Holmes J should in each case be restored although it will now be necessary for the Supreme Court of Queensland to fix a new timetable for the proceedings, having regard to the interruption to that timetable consequent on the appeals. Orders To give effect to this conclusion in each appeal, I agree in the orders proposed in the joint reasons. 50 House v The King (1936) 55 CLR 499 at 504-505. 51 [2005] HCATrans 1006 at 841-863. See joint reasons at [21]. 52 [2005] HCATrans 1006 at 953-959. 53 [2005] HCATrans 1006 at 808-814.
HIGH COURT OF AUSTRALIA MARJORIE HEATHER OSLAND APPELLANT AND SECRETARY TO THE DEPARTMENT OF JUSTICE RESPONDENT Osland v Secretary to the Department of Justice [2008] HCA 37 7 August 2008 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Victoria made on 17 May 2007. Remit the matter to the Court of Appeal of the Supreme Court of Victoria for further hearing in accordance with the reasons of this Court. Respondent to pay the appellant's costs of the appeal to this Court. On appeal from the Supreme Court of Victoria Representation J B R Beach QC with R H M Attiwill and J D Pizer for the appellant (instructed by Hunt & Hunt) P M Tate SC, Solicitor-General for the State of Victoria with S B McNicol and M J Richards for the respondent (instructed by FOI Solutions) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Osland v Secretary to the Department of Justice Administrative law – Freedom of information – Exempt documents – Freedom of Information Act 1982 (Vic), s 50(4) empowered Tribunal to decide access should be granted to exempt documents if of opinion that public interest required access to be granted – Whether, in circumstances of this matter, Court of Appeal erred in concluding no basis for Tribunal to exercise power, when Court of Appeal did not examine documents. Practice and procedure – Legal professional privilege – Waiver – Legal advice obtained in relation to petition for exercise of prerogative of mercy – Whether issue of press release disclosing existence and effect of advice inconsistent with maintenance of confidentiality in content of advice. Words and phrases – "legal professional privilege", "mercy", "pardon", "public interest", "public interest override", "waiver". Freedom of Information Act 1982 (Vic), ss 30, 32, 50(4). GLEESON CJ, GUMMOW, HEYDON AND KIEFEL JJ. The appellant applied, under the Freedom of Information Act 1982 (Vic) ("the Act"), for access to certain documents in the possession of the Department of Justice of the Government of Victoria. The documents were prepared by lawyers and departmental officials. They contain advice about a request by the appellant (who was convicted of murder) that she be granted an executive pardon. Access to all but two of 265 pages was refused by the Department, both initially and upon internal review. The documents were said to be exempt from disclosure by reason of s 30 (which relates to internal working documents) and s 32 (which relates to legal professional privilege) of the Act. Pursuant to s 50 of the Act, the appellant applied to the Victorian Civil and Administrative Tribunal ("the Tribunal") for review of the decision. The Tribunal is established by s 8 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) ("the VCAT Act") and has two types of jurisdiction, "original jurisdiction" and "review jurisdiction" (s 40). The application was heard by the President of the Tribunal, Morris J, who agreed that the documents fell within s 32, but applied in favour of the appellant what is described as the "public interest override" provided by s 50(4) of the Act. He ordered that the appellant be given access to the documents1. On appeal to the Court of Appeal of the Supreme Court of Victoria, the decision of the Tribunal was reversed2. The Tribunal is empowered by s 80(3) of the VCAT Act to direct the production of documents by a party in a proceeding for review of a decision despite, among other things, "any rule of law relating to privilege or the public interest in relation to the production of documents." The Tribunal, after inspecting the documents, found that they were all the subject of legal professional privilege. It did not deal with the additional claim for exemption under s 30. In the Court of Appeal, the only ground of challenge to the Tribunal's conclusion that the documents were the subject of legal professional privilege was a contention that the privilege had been waived in relation to one of the documents, a joint advice of three senior counsel (referred to as document 9). There was no challenge to the conclusion that the other documents in question were covered by s 32, although the present respondent complained that the Tribunal should also have dealt with the s 30 ground of exemption. The Court of Appeal held that the Tribunal had been correct to decide that legal professional privilege had not been waived in respect of 1 Re Osland and Department of Justice (2005) 23 VAR 378. 2 Secretary, Department of Justice v Osland (2007) 95 ALD 380. document 9. The Court of Appeal also held that the Tribunal had erred in law in dealing with the public interest override and, further, that there could be no basis on which, on the material before the Tribunal, an opinion could be formed that the public interest required access to the documents (including document 9). It made that decision without itself having inspected the documents. The issues in this appeal Following a limited grant of special leave to appeal, the appellant propounded the following grounds of appeal: The Court [of Appeal] erred in law in: finding that the Victorian Attorney-General did not waive and thereby lose legal professional privilege in respect of the joint memorandum of advice of Susan Crennan QC (as she then was), Jack Rush QC and Paul Holdenson QC to the Attorney-General dated 3 September 2001 being Document 9 ('the joint advice') by publishing a press release on 6 September 2001 ('the press release') that disclosed the substance and gist of the joint advice and the conclusions reached in it; and ordering that the decision of the Respondent to deny the Appellant access to the joint advice be affirmed. The Court erred in law in finding that the learned President of the Victorian Civil and Administrative Tribunal ('the Tribunal') correctly concluded that the Attorney-General did not waive legal professional privilege in respect of the joint advice. The Court, without considering the content of Documents 1, 3, 4, 5, 6, 7, 8, 9 and 11 (which were inspected by the Tribunal but not the Court), erred in law in concluding that there could be no basis upon which, on the material before the Tribunal, an opinion could be formed under s 50(4) of the Freedom of Information Act 1982 (Vic) that the public interest requires that access to the said documents be granted under the Act." Grounds 1 and 2 relate only to document 9, and only to the question of waiver of privilege. As in the Court of Appeal, there is in this Court no challenge to the Tribunal's conclusion that the other documents were covered by s 32, and as to document 9 the only challenge is to the Tribunal's conclusion that privilege in that particular document was not waived. Ground 3 relates to all the documents in dispute, and challenges the Court of Appeal's conclusion that there was no basis for applying the public interest override, bearing in mind that the Court of Appeal did not examine the documents for itself. The petition to the Governor of Victoria and the consideration of the petition On 2 October 1996, following a trial by jury in the Supreme Court of Victoria, the appellant was convicted of murdering her husband, who was beaten to death with an iron bar. The prosecution case, accepted by the jury, was that the appellant planned and assisted in the killing. The appellant had been subjected to violence by her husband, and relied, unsuccessfully, upon defences of self-defence and provocation. She was sentenced to imprisonment for fourteen and a half years, with a non-parole period of nine and a half years. She is now on parole. An application to the Court of Appeal for leave to appeal against conviction and sentence failed3. A further appeal to this Court failed4. Having exhausted her rights of appeal, the appellant invoked the power of the Governor of Victoria to grant a pardon. Morris J gave the following account of the legal basis of that power, and the practice that is followed in matters where the power is invoked. This account was not disputed in argument, and may be accepted as accurate and sufficient for present purposes. "A petition for the exercise of the prerogative of mercy is a request made to the Crown by an individual seeking release from the effects of a conviction in circumstances where all avenues of appeal to the courts have been exhausted or where the courts have no jurisdiction. The Governor of Victoria has the power to exercise the prerogative of mercy as a representative of Her Majesty the Queen. The power derives from section 7 of the Australia Act 1986 (Commonwealth) which provides that the powers and functions of the Queen in respect of a State are exercisable only by the Governor of the State (subject to exceptions which are not presently relevant). Section 7(5) of that Act provides that advice to the Queen (and her representative) in relation to the exercise of the powers and functions of the Queen in respect of a State shall be tendered by the Premier of the State. 3 R v Osland [1998] 2 VR 636. 4 Osland v The Queen (1998) 197 CLR 316; [1998] HCA 75. On 14 February 1986 the Queen issued Letters Patent relating to the Office of the Governor of Victoria. Clause III of the Letters Patent states, among other things, that the Premier shall tender advice to the Governor in relation to the exercise of powers and functions of the Governor not permitted or required to be exercised in Council. By convention, the accepted practice is and has been that the Premier seeks the advice of the Attorney-General in relation to whether the prerogative should be exercised. In turn, when the advice of the Attorney-General is sought, it is practice for the Attorney-General to ask his or her department to consider, evaluate and make recommendations the petition. Sometimes the advice of the Victorian Government Solicitor is sought. To the extent that a petition of mercy raises non-legal grounds (for example, compassionate grounds, meritorious conduct grounds, or other special grounds) the assessment of the petition on those other grounds is usually conducted within the department. Clearly enough, though, there will often be an overlap between what might be described as legal grounds and what might be described as non-legal grounds. in relation Before tendering his advice to the Premier, the Attorney-General may wish to follow up the advice he or she has received in relation to the matter. Generally the Attorney-General advises the Premier and it is then a matter for the Premier to proffer advice to the Governor. On rare occasions the Attorney-General's advice may be considered by Cabinet before the Premier makes a recommendation to the Governor. However this did not apply in the present case." The appellant's petition was lodged with the Attorney-General for Victoria on 5 July 1999. The arguments advanced in support of the petition were summarised as follows: There is strong evidence that with appropriate law reform which acknowledged gender difference in provocation and self defence, Mrs Osland would have been found to have acted in self defence when Frank Osland was killed. Additional and new evidence strongly supports Mrs Osland's claim that she acted in self defence when her husband died. 3. Mrs Osland's sentence is very severe when weighed in the context of her life experience and, if served in full, will significantly exceed the terms served by women in recent comparable cases which we have been able to identify. Mrs Osland lived in a prison of domestic violence for 13 years before entering her current prison. Her cumulative suffering has been and continues to be so profound that executive intervention is now warranted in ending it. Even if it is accepted that Mrs Osland committed an offence, she and her family were so offended against by the wider community in its failure to protect her and her children from sustained torture, terror and trauma, that it is appropriate that the community's representative should now temper Mrs Osland's justice with compassion. None of the reasons for which we as a community imprison people – to punish, to reform, to deter others from offending – apply in her case any longer. 6. Mrs Osland's continuing imprisonment is corrosive of people's faith in the justice system because it shows the law failing." While the petition was being considered, there was a State election and a change in Attorneys-General. In the course of consideration of the petition, the documents the subject of these proceedings were brought into existence. The general nature of the documents and the circumstances in which they were produced may be seen from the following edited extract from the Tribunal's reasons that was included by Maxwell P as a schedule to his reasons for judgment. "At the time of the State election in 1999 the petition for mercy was still being considered by the then Attorney-General, the Honourable Jan Wade MP. By that time Document 1 had been created, being a memorandum of legal advice dated 17 August 1999 from the Victorian Government Solicitor to the Attorney-General ('the first VGS advice'). Following the election, and the appointment of a new Attorney- General (the Honourable Rob Hulls MP), Document 2 was created. This is a memorandum of advice from Mr W H Morgan-Payler QC and Mr Boris Kayser, both Crown prosecutors, to the Director of Public Prosecutions. This document ('the Crown prosecutors' advice') is dated 2 December 1999, and provides advice that the petition be rejected. (It transpired, on the eve of the Tribunal hearing, that the applicant had already received a copy of the Crown prosecutors' advice; and, as a result, the respondent no longer maintained that this document was an exempt document.) Following the preparation of the Crown prosecutors' advice, Document 3 was created: this is a memorandum of advice, dated 8 December 1999, from the Victorian Government Solicitor to the Attorney-General ('the second VGS advice'). This memorandum provided further advice to the Attorney-General in relation to the petition and made a recommendation in the light of the advice received from the Crown prosecutors. Document 4 is a memorandum of advice dated 22 February 2000 from the then Acting Director of Legal Policy to the Attorney-General and the Deputy Secretary, Legal, of the department. This document, which is in the form of a short briefing note, also contains a hand written notation by the Attorney-General. Document 5 is a memorandum of advice from the then Director of Legal Policy to the Attorney-General, the Secretary to the department and the Deputy Secretary, Legal, of the department. This memorandum includes a summary of the legal advice which had been obtained at the time of that memorandum. Although this memorandum made certain recommendations, it would appear that no final decision was made as a result of these recommendations. On 9 May 2000 a meeting was held between, among others, the Attorney-General, former Premier Joan Kirner, and representatives of the applicant. During that meeting the Attorney-General stated that an opinion would be obtained from senior counsel on the merits of the petition. The name Robert Redlich QC was mentioned as a member of counsel who may be engaged to provide the advice. Document 6, which is a memorandum dated 10 May 2000 from the Director of the Legal Policy Unit of the department to the Attorney-General and Deputy Secretary, Legal, of the department, sets out issues upon which the opinion from senior counsel was to be obtained. Document 7 is a letter dated 25 August 2000 and a lengthy and detailed memorandum of advice of the same date prepared by Robert Redlich QC and a junior barrister. The memorandum contains very detailed advice in relation to the petition and includes a number of annexures. On 6 December 2000 Document 8 was created. This is a memorandum of advice from the then Director of Legal Policy to the Attorney-General and the Acting Deputy Secretary, Legal, of the department. This memorandum summarises the Redlich advice and sets out options available to the Attorney-General in the light of that advice. After Document 8 was prepared discussions were held between the Attorney-General and the Premier. Following these discussions the Attorney-General requested his department to obtain a further joint advice from three senior counsel. The senior counsel asked to give that advice were Ms Susan Crennan QC, Mr Jack Rush QC and Mr Paul Holdenson QC. Document 9, which is dated 3 September 2001, is a memorandum of joint advice from these three barristers ('the joint advice'). The joint advice is a comprehensive memorandum which canvasses essentially the same issues as those canvassed in the Redlich advice. the joint advice After receipt of the department prepared Document 10. This is a memorandum dated 5 September 2001 from the Director of Legal Policy to the Deputy Secretary, Legal and Equity and the Attorney-General in which it is recommended that a letter be signed recommending that the petition be denied. A copy of this memorandum has already been released. Three draft letters were attached to this memorandum, generally giving effect to the recommendation in the memorandum. (The applicant no longer pursues her request in relation to these draft letters.) Document 11 is a copy of a letter of advice which is undated and which was sent from the Attorney-General to the Premier in relation to the applicant's petition of mercy. This letter enclosed a draft letter of advice from the Premier to the Governor and a draft letter of advice from the Governor to Mrs Osland." By the time of the Tribunal's decision, documents 2 and 10 were no longer the subject of dispute. For the purpose of consideration of the issues to be decided by this Court, it is unnecessary to go into further detail about the nature of the petition. As Morris J recognised, and as is evident from the above summary of the matters relied upon by the appellant, reliance was placed on legal argument, wider questions of justice and public policy, including possible law reform, and compassionate grounds personal to the appellant and arising from the particular circumstances of her case. Although petitions of this kind ordinarily are considered by lawyers within the Department of Justice, or external lawyers retained for the purpose, they need not be, and frequently are not, limited to questions of strict law. In various contexts, legal professionals advise on matters of policy, their legal expertise being relevant to the weight to be attached to their opinions. The circumstance that a petition such as that of the appellant was put before lawyers within and outside the Department of Justice for their opinion is neither surprising nor unusual. As Morris J also observed, this Court has held that legal professional privilege may attach to advice given by lawyers, even though it includes advice on matters of policy as well as law5. In the course of explaining his reasons for deciding that all the disputed documents were the subject of legal professional privilege, Morris J dealt with the fact that some of them covered matters that went beyond purely legal issues. He also found that it was not practicable to provide an edited version of any of the documents. These aspects of his decision were not the subject of any ground of appeal or contention in the Court of Appeal or in this Court. On 6 September 2001, the Attorney-General announced that the Governor had denied the appellant's petition. The press release The announcement of the denial of the petition was accompanied by a press release which said: "On July 5, 1999, Mrs Osland submitted a petition for mercy to the then Attorney-General Jan Wade. That petition set out six grounds on which the petition should be granted. Following consultation with the State Opposition, I appointed a panel of three senior counsel, Susan Crennan QC, Jack Rush QC and Paul Holdenson QC, to consider Mrs Osland's petition. This week I received a memorandum of joint advice from the panel in relation to the petition. The joint advice recommends on every ground that the petition should be denied. After carefully considering the joint advice, I have recommended to the Premier that the Governor be advised to deny the petition. The Governor has accepted this advice and denied the petition." The appellant's argument about waiver of privilege in respect of document 9 turns upon the second sentence in the third paragraph of the press release. It was acknowledged that, without that sentence, there would probably be no issue of waiver. Morris J said: 5 Waterford v The Commonwealth (1987) 163 CLR 54; [1987] HCA 25. "The reason why the Attorney-General took this course seems clear enough. He wished to demonstrate to the public that the petition of mercy had been taken seriously and that the Government had taken high level advice before recommending that the petition be denied. Further, by naming the counsel and stating that the joint advice recommended on every ground that the petition should be denied, the Attorney-General was seeking to rely upon the reputation of the senior counsel to support the reasonableness of the Government's decision. I find that this was totally legitimate." Morris J found as a fact that the press release did not distort the joint advice or create a misleading impression, by which, having regard to the context, he evidently meant a misleading impression about the contents of the joint advice. The legislation The Act is described in its long title as: "An Act to give the Members of the Public Rights of Access to Official Documents of the Government of Victoria and of its Agencies and for other purposes". Section 13, which is in Pt III, provides that, subject to the Act, every person has a legally enforceable right to obtain access in accordance with the Act to a document of an agency, or an official document of a Minister, other than an exempt document. Part IV identifies exempt documents. It includes ss 30 and 32. Section 30 covers certain kinds of "internal working documents" (which, having regard to the definition of "officer" in s 5, includes documents that might not ordinarily be regarded as purely "internal") if their disclosure would be contrary to the public interest. Section 32 covers a document that "would be privileged from production in legal proceedings on the ground of legal professional privilege." The case has been conducted on the basis that s 32 would cease to apply to a document in respect of which privilege was waived. There appears to be no reason to doubt that premise. Part VI of the Act deals with review, including review by the Tribunal, of decisions to refuse access to documents. It includes the following provision (the "public interest override") in s 50(4): "On the hearing of an application for review the Tribunal shall have, in addition to any other power, the same powers as an agency or a Minister in respect of a request, including power to decide that access should be granted to an exempt document (not being a document referred to in section 28, section 29A, section 31(3), or in section 33) where the Tribunal is of opinion that the public interest requires that access to the document should be granted under this Act." Several points concerning the construction of s 50(4) and its place in the Act may be made forthwith. First, the sub-section to some degree is a legislative response to considerations of the nature explored by Lord Wilberforce in British Steel Corporation v Granada Television Ltd6: "Then there is the alleged right to a free flow of information, or the right to know. Your Lordships will perceive without any demonstration from me that use of the word 'right' here will not conduce to an understanding of the legal position. As to a free flow of information, it may be said that, in a general sense, it is in the public interest that this should be maintained and not curtailed. Investigatory journalism too in some cases may bring benefits to the public. But, granting this, one is a long way from establishing a right which the law will recognise in a particular case. Before then it is necessary to take account of the legitimate interest which others may have in limiting disclosure of information of a particular kind." Secondly, the specific exclusions from the operation of s 50(4) – Cabinet documents (s 28), documents affecting security, defence or international relations (s 29A), certain law enforcement documents (s 31(3)), and documents affecting personal privacy (s 33) – indicate what otherwise is the scope of s 50(4). Thirdly, that a ground of general exemption, such as that exempting documents privileged from production on the ground of legal professional privilege (s 32), is not made good in a particular case does not deny the possible operation of s 50(4) in the circumstances of that case. Section 50(4) is a unique provision in Australian freedom of information legislation. The Freedom of Information Act 2000 (UK)7 provides for general rights with respect to access to information (s 1(1)) and for information which may be exempt. Some exemptions are absolute (s 2(3)). They include exemptions of the kind which the Victorian Act excludes from the operation of s 50(4)8. Other exemptions, such as that relating to information the subject of [1981] AC 1096 at 1168. 7 The relevant provisions of which came into effect on 1 January 2005. 8 See s 2(3) and, for example, s 23 (corresponding, in part, to s 29A of the Act) and s 40 (corresponding, in part, to s 33 of the Act). legal professional privilege, are not treated as absolute9. Whether such an exemption is maintained depends upon whether the public interest in maintaining it outweighs the public interest in disclosing the information (s 2(2)(b)). A point which arises from the United Kingdom Act, as relevant to s 50(4), is that it is not possible to approach an exemption such as that provided in s 32 with respect to documents subject to legal professional privilege as if it were absolute. To do so would deny the intended operation and effect of s 50(4). The VCAT Act, in Pt 5, provides for appeals from the Tribunal. So far as presently relevant, it provides, in s 148(1), that a party to a proceeding may appeal, on a question of law, from an order of the Tribunal to the Court of Appeal. Section 148(7) provides that the Court of Appeal may make any of the following orders: an order affirming, varying or setting aside the order of the Tribunal; an order that the Tribunal could have made in the proceeding; an order remitting the proceeding to be heard and decided again, either with or without the hearing of further evidence, by the Tribunal in accordance with the directions of the court; any other order the court thinks appropriate." The decision of the Tribunal Having concluded (for reasons that are not presently in issue) that all the disputed documents were the subject of legal professional privilege within s 32, Morris J went on to deal with the argument that, in relation to document 9, privilege had been waived by the disclosure, in the Attorney-General's press release, not only that advice had been taken from the authors of the joint advice, but also, and critically, that the advice "recommend[ed] on every ground that the petition should be denied." Applying what was said in this Court in Mann v Carnell10, concerning implied or imputed waiver (it was not suggested that the present was a case of express waiver), Morris J held that such disclosure as was made in the press release was not inconsistent with the maintenance of the confidentiality which the privilege protects, and that there was no waiver. 9 See s 2(3) and s 42. 10 (1999) 201 CLR 1 at 13 [28]-[29]; [1999] HCA 66. As to s 30, Morris J said: "I cannot see how the documents could be exempt under section 30 if I was to form the opinion that the public interest requires that access be given to the documents; and if I was not to form such an opinion, it is unnecessary to determine this question as I intend to uphold the claim under section 32." He went on to consider s 50(4). the general importance of maintaining Morris J commenced what he described as a balancing process by making some observations about legal professional privilege. In that context, he distinguished between "historical documents" and documents likely to be relevant to a future government decision. The documents in question, he said, fell into the former category. By "historical" he meant relating to a past decision as distinct from relating to a future decision. The decision in question was made in September 2001, about four years before the Tribunal's decision. However, as appears from other parts of the reasons of Morris J, there was an ongoing public controversy about the appellant's conviction and sentence, and about the refusal of the petition. In assessing the proposition that the documents were historical it is necessary to keep in mind the sense in which that term was being used. Included in public interest factors favouring release, as they appeared to Morris J, were the public interest in free availability of information and democratic discussion of government decisions, and the public interest in the operation of the criminal justice system. The Osland case, he said, was unique because of the publicity and concern it generated. Having remarked that it was "totally legitimate" for the Attorney-General to refer to the joint advice, Morris J went on: "However in circumstances where a government decision is made in relation to a petition of mercy, relying upon particular advice which is specifically referred to, there will be a strong public interest in also making available any other advice that has been obtained in relation to the same question. If a decision maker obtains advice from two sources and receives different advice, the public might be misled if it is told that a decision has been made on the basis of advice (specifying the advice) without reference to the fact that there was also different advice. If only one advice is specified in such circumstances an impression may be created that the decision maker really had no choice; whereas if the two different advices are specified the public might think that there was a choice to be made by the decision maker and wish to know why a particular choice was made. In my opinion, there are powerful reasons why the conclusions contained in the VGS advices and the Redlich advice should be made available to the public. It is only if these conclusions are publicly available that citizens will be in a position to put these conclusions beside the conclusions in the joint advice; and to assess the merits of the Government's decision to deny the petition of mercy. However the provision of access to just the conclusions contained in the VGS advice and the Redlich advice is likely to raise even more questions about the consideration of the petition of mercy, without answers. Are the reasons given in the joint advice more cogent than the reasons given in the Redlich advice? Was the same information available to each advisor? And so on. In order to clear the air and properly inform the public it would be necessary for the whole of these documents, not just the conclusions, to be made available." (emphasis in original) It is difficult to know exactly what to make of the references to "different advice". Morris J examined the documents in question. From his description of document 2 (which was made available to the appellant) we know that it recommended that the petition be rejected. On the other hand, we do not know what document 7 recommended. For understandable reasons, Morris J was circumspect in what he said about the contested documents. Their availability was (and still is) the subject of dispute. They have not been seen by the appellant or by her lawyers. They do not know in what, if any, respects the advices are different. Morris J made no finding that they were materially different, but after referring to the potential significance of difference he spoke of "powerful reasons" for making the conclusions of the VGS advices and the Redlich advice available to the public. It is difficult (and would have been difficult for the Court of Appeal) to know whether he was merely referring to possible speculation by members of the public that there may have been significant differences, or whether he was indicating that his own examination of the documents revealed such differences. The reasoning in these two paragraphs is far from clear, but that may be the consequence of a desire not to say too much about the contents of the documents and thereby pre-empt the outcome of the entire dispute. Morris J applied s 50(4) and ordered that access be given to documents 1, 3, 4, 5, 6, 7, 8, 9 and 11. The decision of the Court of Appeal The Secretary to the Department of Justice appealed to the Court of Appeal, claiming a number of errors of law in the Tribunal's approach to the exercise of the power conferred by s 50(4). The orders sought included an order that Mrs Osland be refused access to the documents in question or, alternatively, that the matter be remitted to the Tribunal to be heard and determined according to law. Mrs Osland filed a notice of contention which related only to document 9, and claimed that the order for access to that document should be affirmed on the further ground that privilege had been waived. Maxwell P, with whom Ashley JA and Bongiorno AJA agreed on this point, dealt first with waiver. He recorded that there was no challenge to the Tribunal's conclusion that (subject to waiver in relation to document 9) all documents were within the scope of s 32. He began by referring to the statement in Mann v Carnell11: "Legal professional privilege exists to protect the confidentiality of communications between lawyer and client. It is the client who is entitled to the benefit of such confidentiality, and who may relinquish that entitlement. It is inconsistency between the conduct of the client and maintenance of the confidentiality which effects [an implied or imputed] waiver of the privilege". The present, of course, was not said to be a case of express waiver. Maxwell P referred, as an example of inconsistency, to Benecke v National Australia Bank12. That case also exemplifies the fact that a person can waive privilege without intending that consequence. Mrs Benecke, in her pleadings and evidence in certain proceedings, asserted that her lawyer had compromised a claim without her consent. She attempted to rely on privilege to prevent the lawyer giving the lawyer's version of her instructions. Nobody suggested that Mrs Benecke intended a waiver of privilege to be the result of her conduct. It was quite likely that she never thought about the matter. As was said in the judgment in Mann v Carnell13: "[T]he law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege." Maxwell P considered a number of decisions dealing with the question whether a particular disclosure gave rise to a waiver of legal professional privilege. He compared the formulations of Gyles J and Tamberlin J (who were otherwise in agreement as to the outcome) in the Federal Court in Bennett v Chief 11 (1999) 201 CLR 1 at 13 [28]. 12 (1993) 35 NSWLR 110. 13 (1999) 201 CLR 1 at 13 [29]. Executive Officer of the Australian Customs Service14, and expressed the view that, although what Gyles J said may have been apposite to the facts of the particular case, it did not express a rule of general application. Maxwell P considered that it was more accurate to say, as Tamberlin J said, that disclosure of a conclusion expressed in legal advice, without disclosing the reasons, may or may not result in waiver of privilege depending upon a consideration of the whole of the context in which that occurs. After a discussion of a number of cases argued by the parties to be analogous, Maxwell P expressed his conclusion that the Tribunal's decision on waiver was not only open but was clearly correct. He gave his reasons as follows: "Amongst the circumstances relevant to determining inconsistency, it is clear from Carnell and Bennett that the purpose for which the privilege-holder made the disclosure is highly relevant. The question here was whether the use made by the Minister of the disclosed portion of the privileged communication – more particularly, the purpose for which the conclusion was disclosed – was inconsistent with the maintenance of confidentiality in respect of the content of the advice. First it is necessary to restate the purpose of the confidentiality which the privilege preserves. In Grant v Downs, Stephen, Mason and the administration of 'The rationale of this head of privilege, according to traditional doctrine, is that it promotes the public interest because it assists and enhances the representation of clients by legal advisers, the law being a complex and complicated discipline. This it does by keeping secret their communications, thereby inducing the client to retain the solicitor and seek his advice, and encouraging the client to make a full and frank disclosure of the relevant circumstances to the solicitor.'15 justice by facilitating Later, in Baker v Campbell, Mason J noted that the underlying policy of the privilege covering legal advice – 14 (2004) 140 FCR 101. 15 (1976) 135 CLR 674 at 685; [1976] HCA 63. 'involved the promotion of freedom of consultation generally between lawyer and client.'16 In the same case, Deane J said that the principle underlying the privilege was that – 'a person should be entitled to seek and obtain legal advice without the apprehension of being prejudiced by the subsequent disclosure of confidential communications.'17 The evident purpose of the Attorney-General's disclosure was to inform the public that the recommendation he had made to the Governor – that the petition for mercy be denied – was based on independent legal advice, advice which recommended that each ground advanced in the petition should be rejected. The Attorney-General evidently wished it to be known that, in considering whether or not the prerogative of mercy should be exercised, he had taken independent advice and was making a recommendation which accorded with that advice. In the language of Carnell, this was a disclosure 'for the purpose of explaining or justifying' the Attorney-General's actions. The purpose was similar to that of the disclosure in Carnell itself, where the Chief Minister wished to satisfy the relevant member of Parliament that the ACT Government 'had acted responsibly and in accordance with legal advice'.18 In my opinion, there was no inconsistency between disclosing the fact of, and the conclusions of, the independent advice for that purpose, and wishing to maintain the confidentiality of the advice itself. This was not a case of a party to litigation 'deploying' a partial disclosure for forensic advantage, while seeking unfairly to deny the other party an opportunity to see the full text of the privileged communication. Nor was it 'the laying open of the confidential communication to necessary scrutiny'.19" 16 (1983) 153 CLR 52 at 74; [1983] HCA 39. 17 (1983) 153 CLR 52 at 115-116. 18 (1999) 201 CLR 1 at 8 [14]. 19 DSE (Holdings) Pty Ltd v Intertan Inc (2003) 127 FCR 499 at 519 [58], 520 [61]. As to s 50(4), Maxwell P said that the way in which the Tribunal had dealt (or, rather, failed to deal) with the claim for exemption under s 30 (relating to internal working documents) involved an error of law, relevant to the public interest override, which alone would have been sufficient to justify allowing the Secretary's appeal. Section 30 treats a document as an exempt document if two conditions are satisfied. First, the document must answer a certain description. The second condition is that disclosure would be contrary to the public interest. The Tribunal had put the s 30 claim for exemption to one side, saying that if the Tribunal were to form an opinion, under s 50(4), that the public interest required that access be given to the documents, then the documents could not be exempt under s 30, because the second condition could not be satisfied. Maxwell P pointed out that, in the result, when the Tribunal dealt with s 50(4), it failed to take into account the particular public interest considerations underlying the the efficient and exemption for economical conduct of government, protection of the deliberative processes of government, particularly at high levels of government and in relation to sensitive issues, and the preservation of confidentiality so as to promote the giving of full and frank advice. Ashley JA agreed, as did Bongiorno AJA. internal working documents, including All three members of the Court of Appeal went on to consider what Maxwell P described as "the other grounds of attack on the Tribunal's conclusion that the public interest required that access be granted to the documents." Maxwell P found legal error in the Tribunal's distinction between advice that was of historical interest only (in the sense earlier explained) and advice relating to action that was yet to be taken, and in the application of that distinction to the present case. He referred to the statement of Stevenson J in Hobbs v Hobbs and Cousens20 to which McHugh J referred in Giannarelli v Wraith [No 2]21: "[O]nce legal professional privilege attaches to a document ... that privilege attaches for all time and in all circumstances." That observation, of course, is subject to the possibility of waiver. In the context of s 50(4), it is also subject to the possibility of supervening circumstances relevant to the public interest. 20 [1960] P 112 at 117. 21 (1991) 171 CLR 592 at 601; [1991] HCA 2. Maxwell P also concluded that the Tribunal, in discussing the public interest, had taken into account an irrelevant consideration, that is to say, the Tribunal's perception of the public's wish to know the reasons for denying the petition. He then went on to consider whether, in the circumstances of this case, the test imposed by s 50(4) could have been satisfied, that is, whether it was open to the Tribunal to conclude that the public interest required that access to the documents be granted. He answered that question in the negative. He was prepared to leave unresolved the question whether there could be proceedings for judicial review of a decision to refuse a petition, pointing out that the proceedings before the Tribunal, and the Court of Appeal, were not of that character. It was, he said, outside the scope of s 50(4) for the Tribunal to consider, as a matter of principle, whether decisions made in the exercise of the prerogative of mercy should be open to public scrutiny. It was not open to the Tribunal the Parliament's recognition of it in s 32, itself strikes a balance in favour of confidentiality of legal advice, there was an overriding public interest in exposing to public scrutiny decisions made in the exercise of the prerogative of mercy. He concluded: legal professional privilege, and that, although to decide "In my view, the circumstances of the present case give rise to no public interest consideration which would be capable of satisfying the test in s 50(4) so as to require disclosure of the legal advices. It follows that the Tribunal's decision granting access should be quashed and, in its place, there should be substituted an order that the original decision refusing access be affirmed." Ashley JA and Bongiorno AJA both agreed with what Maxwell P said about further errors in the reasoning of the Tribunal on the s 50(4) issue. Bongiorno AJA, with whom Ashley JA agreed, gave somewhat different reasons for concluding that s 50(4) did not operate in favour of Mrs Osland, and that "[t]here could be no justification, on any of the material before the Tribunal or before [the Court of Appeal], for an opinion that the public interest required that access to the documents … be given". Bongiorno AJA said that, in Victoria, the exercise of the prerogative of mercy was not subject to judicial review. He said: "If the prerogative of mercy is indeed part of the criminal justice system at all, it is a part distinct in function and process from all that goes before it – from the filing of a charge in the Magistrates' Court to the dismissal of an appeal by the High Court. The function of the criminal justice system is to determine guilt or non-guilt, and, if applicable, to impose sentence; its process is open, public and examinable at almost every point. It is only when that process is complete that the Sovereign can be petitioned to extend mercy to the person convicted. Whether the prerogative is exercised or not is entirely within the province of the Sovereign advised by the executive government. No question of legal rights is involved. No reasons need be given for the decision taken, whether that decision is to exercise or not exercise the prerogative or to invoke or not invoke s 584 of the Crimes Act 1958 to involve [the Court of Appeal] or the Trial Division of the Supreme Court in the process. The decision itself is not reviewable, nor are the reasons, motives, or intentions of the Crown's representative. Why then should the advice the Attorney- General received before advising the Crown's representative to deny the petition be placed in the public domain? If, in this case, the opinions received by the Attorney-General were not all in agreement or they, or some of them, advised a course other than that which the Attorney-General finally took, the release of those opinions would enable a political collateral attack on the exercise of the prerogative of mercy which would have the effect of changing its fundamental nature. It would cease to be the exercise of the unexaminable power of the Sovereign to pardon or not (or to take any other course) but would become merely another administrative decision of government, which the Attorney-General would have to defend in the public arena. If Parliament had intended that the exercise of the prerogative of mercy should be so fundamentally altered it could replace it with a statutory scheme with any review or appeal procedures it considered appropriate. It has not done so. Until it does there is no public interest, let alone a compelling public interest, in permitting access to the documents sought by [Mrs Osland]. The general proposition as to the desirability of information being made available to inform public discussion of the actions of the executive has no application in the case of the prerogative of mercy. Although the legal nature, boundaries and historical origins of the prerogatives of the Crown (of which the prerogative of mercy is but one) may not be susceptible of precise analysis, for present purposes it is sufficient to recognise that the prerogative of mercy, at least in this country, is not susceptible to judicial review. Why then should there be any public interest in the provision of access to legal opinions obtained by the relevant Minister before he advised the representative of the Crown to refuse [Mrs Osland's] petition? In this case, if the Attorney-General wished to publish the opinions he obtained before advising the Governor to reject [Mrs Osland's] petition he was, and remains, at liberty to do so. No public interest requires that he now make available those opinions to [Mrs Osland]. The second matter which the Tribunal referred to as justifying the application of the public interest override in this case, was that the case was 'unique' because of the large amount of publicity it has generated. But even if publicity suggests that the matter publicised is one in which the public is interested it does not, per se, demonstrate public interest in the sense that term is used in s 50(4) of the Act. It is in this respect that the Tribunal made the error of law to which the President has referred in his judgment. Even if the case is unique, which I take leave to doubt, that factor does not compel disclosure in the public interest. In concluding its analysis of the public interest factors which it considered favoured release of the documents in question the Tribunal again referred to the desirability of transparency in decision-making in the context of the public's right to compare the opinions obtained by the Attorney-General before recommending that [Mrs Osland's] petition be denied. But this proposition advances the case no further. It is erroneous because it commenced from the erroneous position that the function being performed by the Attorney-General involved a decision in the criminal justice process, rather than one of advising the Sovereign as to the exercise of an unexaminable prerogative of the Crown." (footnotes omitted) Waiver of privilege On the issue of waiver of privilege in document 9, an issue resolved adversely to the appellant by both the Tribunal and the Court of Appeal, both parties accepted that the principles to be applied were those stated in the joint reasons of four members of this Court22 in Mann v Carnell23. The difference between the parties concerned their application to the circumstances of the present case. Waiver of the kind presently in question is sometimes described as implied waiver, and sometimes as waiver "imputed by operation of law"24. It 22 Gleeson CJ, Gaudron, Gummow and Callinan JJ. 23 (1999) 201 CLR 1. 24 Goldberg v Ng (1995) 185 CLR 83 at 95, 109, 116; [1995] HCA 39; Mann v Carnell (1999) 201 CLR 1 at 13 [29]. reflects a judgment that the conduct of the party entitled to the privilege is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. Such a judgment is to be made in the context and circumstances of the case, and in the light of any considerations of fairness arising from that context or those circumstances. In the case of Benecke, referred to in Mann v Carnell, and discussed by Maxwell P in the present case, an appreciation of the unfairness if Mrs Benecke could give her version of her communications with her lawyer and at the same time prevent the lawyer from giving her own version was one aspect of the inconsistency between her conduct in making certain kinds of allegation against her lawyer and holding her lawyer to obligations of confidentiality. In the present case counsel for the appellant acknowledged that, if the press release had not included the sentence earlier identified as critical, privilege probably would not have been waived. This is undoubtedly correct, even though, upon that hypothesis, the press release would have made some disclosure concerning legal advice taken by the Department. The conduct of the Attorney-General in issuing the press release and including in it certain information about the joint legal advice is to be considered in context, which includes the nature of the matter in respect of which the advice was received, the evident purpose of the Attorney-General in making the disclosure that was made, and the legal and practical consequences of limited rather than complete disclosure. It is not necessary for present purposes to decide a question about which there was some division of opinion in the Court of Appeal, that is to say, whether it is possible to obtain judicial review of a decision to refuse an executive pardon, or the related question whether it is possible to compel reasons for such a decision25. Although the topic was raised, it was not the subject of substantial argument. The Victorian practice was described in a passage from the Tribunal's reasons set out above, and it is clear that the general practice is that reasons for such decisions are not made public. By hypothesis, a petitioner has exhausted his or her legal rights. The terms "pardon" and "mercy" may create a misleading impression. The power may be invoked in a case where it is alleged that there has been a miscarriage of justice, or in a case where the grounds relied upon are 25 cf Horwitz v Connor (1908) 6 CLR 38; [1908] HCA 33; Flynn v The King (1949) 79 CLR 1 at 7-9; [1949] HCA 38; R v Toohey; Ex parte Northern Land Council (1981) 151 CLR 170 at 261; [1981] HCA 74; Von Einem v Griffin (1998) 72 SASR 110; R v Secretary of State for the Home Department; Ex parte Bentley [1994] QB 349; Reckley v Minister of Public Safety and Immigration (No 2) [1996] AC 527; Lewis v Attorney General of Jamaica [2001] 2 AC 50. purely compassionate, or in some intermediate situation. The person in question may, or may not, claim to be technically and/or morally innocent. An application for a pardon does not imply an admission of guilt; on the contrary, it may be accompanied by an assertion that there has been a wrongful conviction. Nor does it necessarily imply an assertion of innocence; it may be based upon a contention that the law is unduly harsh either generally or in its application to the particular case, or that there are personal grounds for compassion. The pardon, if granted, may be absolute or conditional. In every case, however, the petition is based, not upon a claim of legal right, but upon an appeal to an executive discretion originating in the royal prerogative. The practice is not to give reasons for such a decision. Whether or not, in the circumstances of a particular case, or more generally, that practice is open to challenge is beside the present point. The practice formed part of the context in which the Attorney-General acted. If the appellant has a legal right to seek review of the Governor's decision, or to obtain the reasons for that decision, these present proceedings are not appropriately constituted to vindicate such a right. They are proceedings for review, and consequent appeal, in respect of a decision under the Act; and the point in question is whether the Attorney-General, being otherwise entitled to maintain the confidentiality of certain legal advice, waived that entitlement by his conduct. Whether the practice ought to be different, and whether it could be challenged in judicial review proceedings or otherwise, is not relevant to whether the Attorney- General waived privilege. The evident purpose of what was said in the press release was to satisfy the public that due process had been followed in the consideration of the petition, and that the decision was not based on political considerations. The three eminent lawyers who gave the advice were appointed following consultation with the State Opposition. They were external to the Department. Their advice covered all the grounds upon which the petition was based. They recommended denial of the petition. Their advice was carefully considered, and the petition was denied. The Attorney-General was seeking to give the fullest information as to the process that had been followed, no doubt in order to deflect any criticism, while at the same time following the long-standing practice of not giving the reasons for the decision. This did not involve inconsistency; and it involved no unfairness to the appellant. If she had a legal right to reasons for the decision, then she still has it. If she had no such right, the press release did not deprive her of anything to which she was entitled. What the Attorney-General said did not prevent the appellant from making public her petition, or any part of it, as and when she desired. Whether, in a given context, a limited disclosure of the existence, and the effect, of legal advice is inconsistent with maintaining confidentiality in the terms of advice will depend upon the circumstances of the case. As Tamberlin J said in Nine Films and Television Pty Ltd v Ninox Television Ltd26, questions of waiver are matters of fact and degree. It should be added that we are here concerned with the common law principle of waiver, not with the application of s 122 of the Evidence Act 1995 (Cth) which, as was said in Mann v Carnell27, has the effect that privilege may be lost in circumstances which are not identical to the circumstances in which privilege may be lost at common law28. The reasoning of Maxwell P was correct. Section 50(4) Although there was an unsuccessful attempt to obtain special leave to appeal on wider grounds, the appellant's third ground of appeal is directed to a specific aspect of the way in which the Court of Appeal dealt with the "public interest override". Counsel for the appellant explained the ground as follows: "Our short point is that the Court of Appeal, in the absence of reviewing these specific documents, could not have formed the view that necessarily section 50(4) could not apply." It appears that the Court of Appeal was not invited by either party to inspect the documents in dispute. We were told in the course of argument that, at least on the appellant's side of the record, it was understood that, if the Court of Appeal found legal error in the Tribunal's decision on s 50(4), it would remit the proceedings to the Tribunal. This understanding was said to be supported by an announcement at the commencement of the proceedings in the Court of Appeal that the present respondent did not seek to have the Court of Appeal make a substantive order in relation to the application for access. In the events that occurred, the Court of Appeal made orders denying access, and it did so for the reasons recounted above. The question for this Court is whether, not having seen the documents, the Court of Appeal erred in deciding that, in the circumstances of the case, there was no basis upon which it could have been concluded that the case was one for the application of s 50(4). 26 (2005) 65 IPR 442 at 447 [26]. 27 (1999) 201 CLR 1 at 11 [23]. 28 See also Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49; [1999] HCA 67. The Court of Appeal had available to it the Tribunal's description of the documents and the Tribunal's reasons for applying s 50(4). The legal errors which the Court of Appeal found in the Tribunal's reasons (which are not presently in contest) did not turn upon the particular contents of the documents. The Court of Appeal was able to identify those errors without inspecting the documents. The same applies to the greater part of the Court of Appeal's reasoning on its own approach to the application of s 50(4). The public interest considerations in play were canvassed in the reasons of the Tribunal and the arguments of the parties. The appellant did not rely upon public interest considerations additional to those relied upon by Morris J. Save in one respect Morris J did not say, or suggest, that his decision concerning s 50(4) turned upon any aspect of the contents of the documents apart from their general character as outlined in his reasons. The qualification to what is said in the previous sentence arises from the two paragraphs in the reasons of Morris J quoted above under the heading: "The decision of the Tribunal". As was noted, it is not clear from those paragraphs whether Morris J was saying, or suggesting, that there was some material inconsistency between the joint advice and the other advices received by the Attorney-General, or between the factual bases upon which the various advices were given. Yet he appeared to raise, as a matter for serious consideration, the possibility that there was some "difference" between the joint advice and other advices. Bongiorno AJA, with whom Ashley JA agreed, took up the point directly, although without looking at the documents to see whether there was any factual foundation for it. He dealt with the matter by saying that, if the opinions received by the Attorney-General were in some material respects different, then that was a reason against, rather than in favour of, releasing them. On that factual hypothesis, "the release of those opinions would enable a political collateral attack on the exercise of the prerogative of mercy which would have the effect of changing its fundamental nature." Regardless of whether the advice given by the Attorney-General to the Governor was legally unexaminable, the conduct of the Attorney-General was not unaccountable. The very exercise in which the Attorney-General was engaged in putting out his press release assumed political accountability. Political attack on a decision not to exercise the prerogative of mercy in a particular case, or at least on the process leading to such a decision, is not alien to the process. That does not mean abrogating legal professional privilege and other statutorily recognised grounds of confidentiality. What it means, however, is that the risk of political criticism is not of itself a public interest argument against disclosure. This aspect of the reasoning of two members of the Court of Appeal was erroneous. There are obvious difficulties in giving the phrase "public interest" as it appears in s 50(4) a fixed and precise content. It is sufficient to say here that the assumption by the Attorney-General of political accountability by the putting out of the press release may, in the circumstances, enliven s 50(4). If there were nothing more to it than that Morris J was saying that the very existence of a number of advices meant that, in order to "clear the air" and dispel any speculation about possible inconsistency, they should all be released then the Court of Appeal should have rejected that reasoning. If, however, there were some material difference in the advices, or the facts on which they were based, then, depending on the nature and extent of that difference, it is not impossible that an aspect of the public interest could require its revelation. If Morris J had said nothing about the matter, there was no particular reason why the Court of Appeal should have set out itself to look for such a problem. However, in the light of what Morris J said, the Court of Appeal should have looked at the documents. Its failure to do so was an error of principle in the exercise of a discretion. It could not be said that, as a matter of principle, no inconsistency between the various advices could possibly have required the disclosure of all or any of them. The Attorney-General, in his press release, referred, for an obvious and legitimate purpose, to certain legal advice as recommending the course that was finally taken. If it had been the case that the Government had received other and materially different legal advice then, depending on the nature and extent of the difference, it is possible that this could have been a relevant consideration in deciding the requirements of the public interest under s 50(4). This is not to say that the existence of differences would necessarily require disclosure. Rather, the existence of such differences as might require disclosure, having been raised obliquely by Morris J, could not be disregarded as legally impossible. The ground upon which Bongiorno AJA discarded the possibility as legally irrelevant was incorrect. The Court of Appeal was not obliged to remit the matter to the Tribunal. It was empowered to deal with the s 50(4) issue itself. In doing so, because of what Morris J had said about the possibility of inconsistency, the Court of Appeal should have examined the documents for itself. Having done so, it may well have concluded that the public interest did not require access to the documents and that either there were no material differences or that such differences did not require disclosure of the documents. However, this Court cannot predict the outcome. We have not seen the documents. The matter should be remitted to the Court of Appeal to enable it to inspect the documents. Whether, following such inspection, the Court of Appeal disposes of the matter finally, or remits it to the Tribunal, will be a matter for the Court of Appeal to decide. Orders The appeal should be allowed. The orders of the Court of Appeal made on 17 May 2007 should be set aside. The matter should be remitted to the Court of Appeal for further hearing in accordance with the reasons of this Court. The respondent should pay the appellant's costs of the appeal to this Court. Kirby KIRBY J. The Freedom of Information Act 1982 (Vic) ("the FOI Act") introduced to Victoria (as like statutes have introduced elsewhere) an important change in public administration. Australian public administration inherited a culture of secrecy traceable to the traditions of the counsellors of the Crown dating to the Norman Kings of England. Those traditions were reinforced in later dangerous Tudor times by officials such as Sir Francis Walsingham29. They were then strengthened by the enactment throughout the British Empire of official secrets legislation30. A pervasive attitude developed "that government 'owned' official information"31. This found reflection in a strong public service convention of secrecy. The attitude behind this convention was caricatured in the popular television series Yes Minister in an aphorism ascribed to the fictitious Cabinet Secretary, Sir Arnold Robinson: "Open Government is a contradiction in terms. You can be open – or you can have government."32 The ensuing laughter has helped to break the spell of the tradition by revealing its presumption when viewed in the contemporary age with its more democratic values. In Australia, the culture of governmental secrecy was sustained both by statute and by common law33. In 1966, inspired by the example of legislation in Scandinavian countries, the Congress of the United States of America adopted a Freedom of Information Act34. This, in turn, enlivened discussion about reform elsewhere. In 1982, an Australian federal Freedom of Information Act was enacted35. This stimulated initiatives in the State sphere, where, because the public service dated to colonial times, it was sometimes more traditional and more secretive in its procedures than the federal service, dating as it did only to 29 Walsingham was Principal Secretary of State to Elizabeth I. See Attorney-General (UK) v Heinemann Publishers Australia Pty Ltd (1987) 10 NSWLR 86 at 127; cf Hogge, God's Secret Agents, (2005) at 6, 115, 124-125, 276. 30 See eg Official Secrets Act 1911 (UK). See Heinemann (1987) 10 NSWLR 86 at 129; Attorney-General (United Kingdom) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30 at 37-38; [1988] HCA 25. 31 Lane and Young, Administrative Law in Australia, (2007) at 294. 32 Lynn and Jay, The Complete Yes Minister, (1989) at 21. 33 Commissioner of Police v District Court of New South Wales (1993) 31 NSWLR 34 5 USC §552. 35 Freedom of Information Act 1982 (Cth). Kirby The basic purpose of the introduction of freedom of information ("FOI") legislation is the same in all jurisdictions. It is to reinforce "the three basic principles of democratic government, namely, openness, accountability and responsibility"36. The central objective is to strengthen constitutional principles of governance not always translated into reality because of a lack of material information available to electors. Fundamentally, the idea behind such legislation is to flesh out the constitutional provisions establishing the system of representative government; to increase citizen participation in government beyond a fleeting involvement on election days; and to reduce the degree of apathy and cynicism sometimes arising from a lack of real elector knowledge about, or influence upon, what is going on in government. Several of the themes prominent in the debates preceding the introduction of Australian FOI legislation resonate with what was said by this Court not long after in declaring the existence of constitutional limitations upon the restriction of discussion of matters of political concern on the basis that such restriction could impede the effective operation of the democratic norms of the Constitution37. As the decisions of this Court upon that subject reveal, judicial responses to such shifts in legal doctrine have often been divided. Although intermediate courts in Australia have generally embraced the innovations of FOI legislation38, there have been sharp divisions in this Court about the implications of such laws. Thus, for example, McKinnon v Secretary, Department of Treasury39 revealed strongly divergent views with respect to the operation of the federal FOI statute. The starting point for resolving the issues presented by the present appeal is an appreciation of the duty of this Court, in this context, to do what we are constantly instructing other courts to do in giving effect to legislation. This is to read the legislative text in its context (including against the background of the 36 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 2 June 1988 at 1399 cited Commissioner of Police (1993) 31 NSWLR 606 at 612. 37 Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104; [1994] HCA 46; Lange v Australian Broadcasting Corporation (1997) 189 CLR 520; [1997] HCA 25; Coleman v Power (2004) 220 CLR 1; [2004] HCA 39. 38 See eg Director of Public Prosecutions v Smith [1991] 1 VR 63; Commissioner of Police (1993) 31 NSWLR 606; Botany Council v The Ombudsman (1995) 37 NSWLR 357. 39 (2006) 228 CLR 423; [2006] HCA 45. See also Waterford v The Commonwealth (1987) 163 CLR 54; [1987] HCA 25. Kirby significant change that the legislation introduces) and, so far as the text and context permit, to give effect to the legislative purpose40. In the present setting, that purpose is a radical one. It assigns very high importance to a public interest in greater openness and transparency in public administration41. Given the historical background, the attitudinal shift that FOI legislation demanded of Ministers, departments, agencies and the public service is nothing short of revolutionary. The courts ought not to obstruct that shift. On the contrary, they should strive to interpret FOI legislation in a manner harmonious with its objectives, doing so to the fullest extent that the text allows. The facts and legislation The background facts: The factual background to this appeal is explained in the reasons of Gleeson CJ, Gummow, Heydon and Kiefel JJ ("the joint reasons"). Forming part of the background is the decision of this Court in Osland v The Queen42 ("the criminal appeal"). There, I was a member of the majority that rejected the appeal of Mrs Marjorie Osland ("the appellant"), who had challenged her conviction of murder upon several bases. One of her grounds of appeal sought to introduce into the Australian law of provocation and self- defence a recognition of so-called "battered wife syndrome" or "battered woman syndrome" ("BWS")43. Neither party objected to my participation in the present appeal. The reasons of this Court in the criminal appeal demonstrate that considerable attention was paid in argument to the suggested need to adopt a new legal approach to BWS; to whether such adoption would be compatible with basic legal principle; to whether the issue of BWS arose on the evidence adduced in the appellant's trial; and to whether giving weight to BWS might be seen as encouraging resort to violent behaviour. At the conclusion of my discussion of these issues in the criminal appeal, I expressed my opinion on the central question of legal policy presented by the 40 Bropho v Western Australia (1990) 171 CLR 1 at 20; [1990] HCA 24; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]- [70]; [1998] HCA 28. 41 See FOI Act, s 3; reasons of Hayne J at [134]. 42 (1998) 197 CLR 316; [1998] HCA 75. 43 (1998) 197 CLR 316 at 369 [155(5)], 370-380 [158]-[171]; cf at 335-338 [50]-[60]. Kirby case. I did so by reference to what I had earlier written in Green v The Queen44 (a case of so-called "homosexual advance" defence). I endorsed the observation of Gleeson CJ that "[t]he law is not intended to encourage resort to self-help through violence"45. Justice McHugh relevantly agreed in the criminal appeal with my reasons and orders46. The reasons of Callinan J (the other member of the majority) were to similar effect47. Two members of the Court (Gaudron and Gummow JJ) dissented. Because of the nature of the submissions advanced on the appellant's behalf, a considerable part of this Court's reasoning was addressed to public policy questions concerning the content of the criminal law as it affected the appellant, and to the desirability or undesirability of re-expressing that law. The discussion was extensive. It was contested. But the entirety of the debate is on the public record. The appellant subsequently addressed a petition for mercy to the Governor As described in the reasons of the Victorian Civil and of Victoria. Administrative Tribunal ("the Tribunal")48, the petition contained grounds that (with the exclusion of ground 2, referring to "additional and new evidence") were substantially concerned with matters of law reform and public policy, many or most of which were considered by this Court in the criminal appeal. These grounds do not appear to relate to considerations arising by the application of the present law of Victoria, as such. Thus, ground 1 refers to "appropriate law reform"; ground 3 concerns the suggested hardship of the sentence passed upon the appellant in light of her earlier suffering because of domestic violence; ground 4 suggests that even if the appellant committed an offence there is a need for compassion towards her; ground 5 refers to the general public policy purposes of criminal punishment; and ground 6 relates to public confidence in the justice system in circumstances where (it is said) the appellant's imprisonment "shows the law failing". None of these grounds appears to concern matters that might be the subject of legal advice, as between solicitor and client, of a conventional kind. It is difficult to imagine that any of the barristers, or 44 (1997) 191 CLR 334 at 415-416; [1997] HCA 50 cited Osland (1998) 197 CLR 45 Chhay (1994) 72 A Crim R 1 at 13 cited Osland (1998) 197 CLR 316 at 380 [170]. 46 Osland (1998) 197 CLR 316 at 339 [63]. 47 Osland (1998) 197 CLR 316 at 408-409 [239]. 48 Re Osland and Department of Justice (2005) 23 VAR 378 at 381-382 [8]. See also joint reasons at [9]. Kirby senior officials or even the Ministers involved would be inhibited or embarrassed in the slightest by disclosure of any conclusions and recommendations they may have expressed about such issues. Most of the topics had been thoroughly, candidly and forcefully explored in the divergent opinions in this Court in the criminal appeal. The legislation: The relevant provisions of the FOI Act and the Victorian Civil and Administrative Tribunal Act 1998 (Vic) are set out in other reasons49. I agree with Hayne J that the object and purpose of the FOI Act are central to the resolution of the present appeal. In part, these may be derived from the overall design of that Act, read against the background of what preceded it. But, in part, they are evident from the short and long titles of the FOI Act and from s 3. The long title of the FOI Act declares that it is: "An Act to give the Members of the Public Rights of Access to Official Documents of the Government of Victoria and of its Agencies and for other purposes". Section 3(1) is worth reproducing in full: "The object of this Act is to extend as far as possible the right of the community to access to information in the possession of the Government of Victoria and other bodies constituted under the law of Victoria for certain public purposes by – (a) making available to the public information about the operations of agencies and, in particular, ensuring that rules and practices affecting members of the public in their dealings with agencies are readily available to persons affected by those rules and practices; and creating a general right of access to information in documentary form in the possession of Ministers and agencies limited only by exceptions and exemptions necessary for the protection of essential public interests and the private and business affairs of persons in respect of whom information is collected and held by agencies." Apparently concerned that Ministers, departments, agencies and courts might conceivably adhere, or return, to the old ways of governmental secrecy, the Victorian Parliament spoke directly to all of those actors. It declared its intention as to how the FOI Act should be interpreted. Section 3(2) of that Act states that such interpretation is to be adopted as would "further the object set out in sub- section (1) [of s 3]". It further requires any discretions conferred by the Act to be exercised "as far as possible so as to facilitate and promote … the disclosure of information". 49 Joint reasons at [18]-[22]. See also reasons of Hayne J at [133]-[135]. Kirby It is difficult to know how the Parliament of Victoria could have been more emphatic, forthright or clear in indicating the commencement of a new legal era. Courts that construe an Act such as the FOI Act, attentive to preserve the status quo ante, avid to find exceptions, and generous in discerning documents exempt from disclosure, are not being faithful to Parliament's purposes and the declared objects of the Act. An approach hostile to the disclosure of information in documentary form will frustrate the imputed intention of Parliament. To the extent that past rules deriving from the royal prerogative, the common law or earlier inconsistent legislation suggest otherwise, those rules must now be adapted to the provisions, objects and realities of the FOI Act. The duty of the courts, including this Court, is to ensure that this occurs. The issues The appellant's grounds of appeal raise three issues: The waiver issue: Is the Attorney-General by his press release to be taken, impliedly or by imputation of law50, to have waived the entitlement of the in respect of respondent document 9, the joint advice of senior counsel concerning the appellant's petition ("the joint advice")? legal professional privilege to rely on The public interest override issue: Was it open to the Court of Appeal, having found relevant error in the reasoning of the Tribunal, but not having inspected all of the contested documents for itself, to conclude that no possible "public interest" could compel the application of s 50(4) of the FOI Act, and on that basis to substitute its own decision for that of the Tribunal? The proper order issue: Taking into account the course of the proceedings to this point, what order should this Court make in disposing of the present appeal? A preliminary question also arises as to whether all of the documents requested by the appellant were truly "exempt" by reason of legal professional privilege. This is not an issue in this appeal in a strict sense, nor was it a subject of contention in the Court of Appeal51. However, because, in my opinion, the proceedings must be returned for reconsideration, it is appropriate to mention this matter because there is potential in a rehearing to revisit it. 50 Joint reasons at [23], [45]. 51 Joint reasons at [13]. Kirby The ambit of legal professional privilege Section 32 of the FOI Act: Section 32 of the FOI Act appears under the heading "Documents affecting legal proceedings". The appellant having exhausted her legal options for challenging her conviction, there are no relevant "legal proceedings" to which any legal advice given to the Government of Victoria would seem to relate. There are, of course, the present proceedings under the FOI Act. However, all of the documents demanded by the appellant were prepared well before these proceedings were commenced. It appears unlikely in the extreme that any legal advice contained in these documents was addressed to the issues now presented. It is true that there was at least the potential for an application for judicial review of decisions of Ministers and possibly of the Governor in respect of the appellant's petition52. However, as described, the advices were addressed to the contents of the appellant's petition to the Governor. Save perhaps for ground 2, the petition accepted the appellant's conviction and addressed issues of law reform, individual hardship and public policy. Notwithstanding the heading to s 32 of the FOI Act, the provisions of s 32(1) extend beyond "legal proceedings" in a strict sense and deal with "legal professional privilege" in general. This Court has affirmed that such privilege is an important civic right. It is a substantive right and not simply the consequence of a rule of evidence law53. It protects a very important entitlement in our society by which anybody may seek, and obtain, legal counsel in the confidence that communications with a lawyer, and documents produced for or in consequence of such communications, will not normally be disclosed without the affected client's consent. In the case of natural persons, legal professional privilege has been described as a basic human right54. Legal persons, such as a constitutional State, a department or agency of a State, or a corporation, are not human beings. They are thus not entitled to the protection of human rights law as such. Nonetheless, 52 The availability of such judicial review does not need to be decided; cf FAI Insurances Ltd v Winneke (1982) 151 CLR 342; [1982] HCA 26; Attorney-General (NSW) v Quin (1990) 170 CLR 1; [1990] HCA 21. 53 Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 553 [11], 575-576 [85]; [2002] HCA 49. 54 See Campbell v United Kingdom (1993) 15 EHRR 137; Foxley v United Kingdom (2001) 31 EHRR 25. Kirby they are, in my view, entitled to the benefit of the ample and protective approach which the common law adopts in respect of legal professional privilege. The privilege belongs to the client, not to the lawyer. A client concerned about a legal question is protected in seeking advice on that question. The protection extends to communications between the client and the lawyer. It upholds the facility of candid, confidential exchanges, essential to the provision of accurate and effective legal counsel. Ambit of legal professional privilege: In Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission55, a case concerning the interpretation of s 155(1) of the Trade Practices Act 1974 (Cth) said to require the production of documents and the giving of evidence for important public purposes, I agreed with the other members of this Court. I accepted that the general language of s 155(1) was insufficient to override an entitlement to legal professional privilege56. However, in reaching that conclusion, I noted an important qualification to which I adhere57: "[This] does not mean that a mere claim of legal professional privilege will be sufficient to attract the privilege. In the case of each communication alleged to be privileged the party making the claim must bring it within the applicable principles58. Legal professional privilege will not be available where a conclusion is reached that particular communications were not prepared for the dominant purpose of giving or receiving legal advice. Similarly, legal professional privilege may not apply where an ulterior purpose for the communication is demonstrated59, for example, where the communication was made in furtherance of a criminal or fraudulent purpose60. The extent to which the privilege would extend to a joint practice of lawyers and non-lawyers (where that is 55 (2002) 213 CLR 543. 56 (2002) 213 CLR 543 at 584 [111]-[113]. 57 (2002) 213 CLR 543 at 585 [114]. See also Mann v Carnell (1999) 201 CLR 1 at 46 [148]; [1999] HCA 66. 58 Now stated in Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49; [1999] HCA 67 and the Uniform Evidence Acts, eg Evidence Act 1995 (Cth), ss 118, 119. 59 Esso (1999) 201 CLR 49 at 80 [81]-[82]. 60 cf Re Compass Airlines Pty Ltd (1992) 35 FCR 447 at 455-456. Kirby permissible) has not been considered. Various other matters of detail remain for the future61." The present case is one with the potential to present a new "matter of detail". Whilst I accept that legal professional privilege is not confined to advice given by lawyers in respect of actual or apprehended litigation, or solely to advice on questions of law narrowly defined (to distinguish them from questions of policy, prudence or appropriate action in given circumstances)62, there has to be a limit. Simply addressing questions or documents to lawyers does not necessarily cloak all of the matters discussed, or all of the documents then produced, with immunity from later production to a court on the basis of legal professional privilege. To permit that would be to ignore the important claims to information that sometimes compete with legal professional privilege. For example, such information may be critical to the lawful and just determination of disputes on the basis of the best available evidence. In determining the ambit of the privilege, regard must be had to the dominant purpose of the creation of the document or communication in question. It is also essential to bear in mind the purpose of the privilege, namely to protect candid communications between a client and a lawyer, untroubled by a risk that such communications (and documents created to facilitate them) will later be produced to work against the interests of the client. Conclusion: defining the ambit: None of the foregoing considerations appears to have been given sufficient attention by the Tribunal. Looking at the subject matters of the appellant's petition, at least in respect of grounds 1, 3, 4, 5 and 663, it is difficult to see any legal interests of the respondent or the State of Victoria, as client, such as would attract legal professional privilege, for the purpose for which that privilege is afforded. Had advice on such matters been obtained from a social scientist, a professor of law, a law reform body or a panel of relevant experts (as might have been done) it would not have attracted legal professional privilege. The thought that senior governmental employees, and the State or a Minister, need to be protected from disclosure of discussions about law reform concerning BWS, the contention of hardship affecting the appellant or the issues of public policy raised by the petition seems quite unconvincing. Arguably, "legal professional privilege", when that phrase is deployed to claim an exemption to a statute having the purposes of the FOI Act, would not extend 61 Australian Competition and Consumer Commission v Daniels Corporation International Pty Ltd (2001) 108 FCR 123 at 148 [95] per Lindgren J. 62 Waterford (1987) 163 CLR 54 at 77. See also Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 389 [30]. 63 Joint reasons at [9]. Kirby to communications of such generality. It would be different when the issues might relate to existing or potential rights and liabilities of a legal character (such as those mentioned in ground 2). I have mentioned this issue because it arose during argument and because it indicates a need for closer attention to questions of this kind in the context of a statute having the reformatory purposes of the FOI Act. The issue cannot be taken further in this appeal. First, it is not presented by a ground of appeal. Secondly, it was not explored at any length by the President of the Tribunal (Morris J) and he was the only judge in these proceedings to inspect all of the contested documents. Thirdly, although Morris J did specifically turn his attention to whether, by editing the documents, some part of them might be disclosed and other parts withheld64, he concluded that this course was not feasible. The ambit of legal professional privilege needs to be defined in the proper context. The privilege referred to in s 32 of the FOI Act is necessarily that of a governmental party. At least in the case of a Minister, it concerns documents of a kind to which the FOI Act is intended to be applicable, unless such documents are "exempt". It would be a mistake to assume that all communications with government lawyers, no matter what their origins, purpose and subject matter, fall within the ambit of the State's legal professional privilege. Advice taken from lawyers on issues of law reform and public policy does not necessarily attract the privilege. Especially in the context of the FOI Act, and legal advice to government, courts need to be on their guard against any inclination of lawyers to expand the ambit of legal professional privilege beyond what is necessary and justifiable to fulfil its legal purposes. The privilege was not waived Principle of waiver: It was common ground that the extent of any waiver of legal professional privilege, and the effect of such waiver, were, in this case, to be decided according to the common law. This distinguishes the present appeal from other cases in which the issue of waiver has arisen in the context of application of the Uniform Evidence Acts65. The issue of waiver arises in this appeal in relation to one document only, namely the joint advice. The question, to be decided by reference to the principle of imputed waiver, is whether, whatever the subjective intention of the Attorney- 64 Joint reasons at [27]; cf Osland (2005) 23 VAR 378 at 389 [38] referring to the FOI Act, s 25. 65 cf Mann (1999) 201 CLR 1 at 15 [34]. Kirby General in publishing the press release upon which the appellant relies, the objective fact of that publication was incompatible with a continued insistence by the respondent on legal professional privilege, and made such insistence unwarranted and unfair in the circumstances. Each of these words is important. "Unwarranted" signifies a legal conclusion, namely that enough has been disclosed of the subject communication to evince conduct "inconsistent with the maintenance of the confidentiality which the privilege is intended to protect"66. Effectively, the client cannot have it both ways. It cannot provide part of the confidential information (inferentially that part which favours its position) to others, whilst demanding that everything else (which may reveal that position in a different light) be treated as confidential. The use of the word "unfair" does not mean that all that the decision-maker has to do is to weigh up the respective "fairness" of the positions of the client and its opponent and decide the question of waiver according to such generalised considerations. But considerations of "fairness" may be relevant to whether there is an inconsistency between the conduct said to amount to waiver and the maintenance of the privilege67. In deciding what the law requires, a court considers the supposed waiver in the context of all of the relevant circumstances. What is normally involved (as here) is a question of fact and degree68. The search is not for the actual or imputed intention of the party said to have waived its privilege. It is a search for the objective consequence of that party's conduct in revealing some, but not all, of the particular legal advice. Arguments for waiver: When the foregoing principles are applied, I am prepared to accept that the appellant's submissions on this issue are not without a certain merit: The focus of the press release was the joint advice. This narrows the issue to one document, which neither the Court of Appeal nor this Court has seen; 66 Mann (1999) 201 CLR 1 at 13 [29]. 67 Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 481 per Gibbs CJ, 488 per Mason and Brennan JJ, 493 per Deane J; [1986] HCA 80; Mann (1999) 201 CLR 1 at 15 [34]; cf Standard Chartered Bank of Australia Ltd v Antico (1993) 36 NSWLR 87 at 93-95. 68 cf joint reasons at [49]. Kirby The press release made it known that there were six grounds on which it was said that the appellant's petition should be granted; The general issues to which the appellant's case gave rise (and to which, it could be inferred, the advice might have related) were notorious as a result of the earlier criminal appeal and the debate that followed. I would be prepared to take judicial notice of the discussion of those issues in the general media, as well as in specialised journals. The Tribunal itself accepted that those issues had attracted a great deal of public attention, taking note of a public address given by the then Chief Justice of Victoria69, the publication of an issues paper and report by the Victorian Law Reform Commission on Defences to Homicide which considered the subject70 and publicity in the general media indicating community attention to, and discussion about, the state of the law as declared by this Court; The press release identified by name the three senior, independent legal counsel who gave the joint advice. Presumably this was done in order to emphasise its quality and acceptability; and The press release went on to indicate that the advice had recommended "on every ground that the petition should be denied". That statement necessarily opened a window into the contents of the advice. It affirmed that (by inference unanimously) the joint advice had dismissed each and every ground relied on by the appellant in her petition. It withheld the reasons for the opinions of counsel whilst claiming the advantage, before the public eye, of the fact that the opinions on the identified grounds were wholly negative. In these circumstances, the appellant's argument for waiver becomes easier to understand. Her counsel pointed out that she had the highest possible interest in access to the joint advice because it was the foundation of the recommendation, ultimately accepted by the Governor, that her petition for mercy should be refused. That refusal confirmed the appellant's conviction and resulting sentence of imprisonment, with the attendant parole order that continues to affect her liberty. In making her demand, the appellant was not just a member of the "public". She had a serious personal interest to defend. 69 See Brown, "Memorial oration seeks provocation review", (1999) 73(6) Law Institute Journal 33 cited Osland (2005) 23 VAR 378 at 385 [26]. 70 Victorian Law Reform Commission, Defences to Homicide, Issues Paper, (2002); Victorian Law Reform Commission, Defences to Homicide, Final Report, (2004). See Osland (2005) 23 VAR 378 at 386 [27]. Kirby Moreover, it was the appellant's submission that contextual considerations helped to demonstrate the importance of the waiver on which she relied. Although her petition presented general questions, as well as matters personal to her, the appellant argued that the Attorney-General was seeking to hide behind the rejection of her general contentions by three lawyers. Such advisers, she argued, however distinguished, could not have the last word upon such topics. Nor could their advice from public consideration or criticism. To the extent that the Attorney-General had placed their names and their conclusions in the public domain, he had entered into a public debate about the merits of the joint advice. He could not, then, fairly refuse to reveal any of the reasoning that it contained. legal qualifications insulate their Conclusion: no waiver: I have explained the appellant's arguments on waiver as best I can because I consider that they are by no means baseless. Nevertheless, I am not prepared to dissent from the conclusion that has been reached on this issue at every level in these proceedings. The main considerations that sustain a conclusion that the press release did not entail implied or imputed waiver are as follows: The press release revealed very little about the actual content of the joint advice, aside from the names of its authors and their adverse conclusions; The purpose of issuing the press release was not, as such, to secure some advantage for the State in legal proceedings affecting the appellant. Rather, the purpose was to show, as far as was compatible with non- disclosure, that the State had taken a proper course in obtaining and considering advice from appropriate persons71. To that extent, the Attorney-General had endeavoured to fulfil obligations to interested members of the public to whom, through Parliament, he was accountable. He had done so whilst reserving the entitlement of the State to receive advice to which legal professional privilege attached. The substance of the advice remained confidential; and Given the purpose of the FOI Act to encourage greater openness in public administration, it would be undesirable, in effect, to require the Attorney- General to reveal nothing at all about procedures that had been followed, lest a description of them might result in loss of privilege. In earlier times, no press release would have been issued in respect of a petition to the Governor, save perhaps one containing an announcement of its rejection. I would not want to say anything in this appeal that would discourage the public revelation of the general course followed in such matters. 71 See joint reasons at [48]. Kirby In the end, therefore, assuming that legal professional privilege extended to the joint advice (a matter not now in issue), the maintenance by the Attorney- General of a claim to legal professional privilege was neither unwarranted nor unfair to the appellant in the circumstances. The waiver issue must therefore be decided adversely to her submissions. The "public interest" override applies Public interest override: I now reach the issue upon which the Court of Appeal differed from the Tribunal72, and in respect of which a difference has emerged in this Court. On this issue I agree, in general, with the joint reasons. I disagree with what Hayne J has written. It is essential, once again, to view s 50(4) of the FOI Act in the context of the Act as a whole, with its radical purpose to change past practices at the forefront of attention. The power that s 50(4) grants to the Tribunal (subject to exclusions) to override a ministerial claim to exemption on the basis that "the public interest requires that access to [a] document should be granted under this Act" is significant and exceptional. It is for this reason that s 50(4) has been described, rightly, as a "most extraordinary provision"73. The power must be interpreted and applied with this in mind. The specific exclusions from this novel power are not applicable in the present case. It does not concern a Cabinet document (s 28 of the FOI Act), a prescribed law enforcement document (s 31(3)) or a document affecting personal privacy (s 33)74. The particularity of these exclusions further emphasises the breadth of the power of the Tribunal to override a ministerial decision in respect of other documents said to be exempt (including under s 32). There is an additional consideration, deriving from the purpose, objects and structure of the FOI Act, that sheds light on the power of override afforded under s 50(4). It is not uncommon for tribunals nowadays to enjoy a power to overturn decisions of officials and agencies on the merits. However, it remains unusual and exceptional in our society for tribunals (as distinct from courts) to be given a power to substitute their determinations for those of Ministers. 72 Osland (2007) 95 ALD 380 at 405 [103]. 73 Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 341 [28] per Phillips JA. 74 See also the FOI Act, s 29A (documents affecting national security, defence or international relations), which came into operation on 16 April 2003. Kirby By definition, Ministers are accountable to Parliament. It is commonly considered that Ministers (and the Parliaments to which they are accountable) will be at least as able to determine questions about the "public interest" as courts and, still more, tribunals of mixed membership75. The fact that (specific exclusions aside) the FOI Act empowers the Tribunal effectively to step into the shoes of a Minister and decide that access should be allowed to an otherwise exempt document is a powerful indication of the radical purpose of the Victorian Parliament to permit independent and non-political judgments about the "public interest" to prevail. By inference, the s 50(4) override was enacted because of a concern on the part of Parliament that, in particular cases, Ministers (and officials advising them) might not be in as good, or as independent, a position to evaluate the "public interest" as the Tribunal (in this case, the President of the Tribunal, a judge having Supreme Court status). So radical and unusual are the terms of s 50(4) that a court should hesitate before frustrating the exercise of the power that it affords or taking a narrower view of the "public interest" than the Tribunal to which that power has been entrusted. Before interfering with Tribunal decisions for supposed error of law, the general courts, including the Court of Appeal and this Court, must be very sure that such error has been demonstrated as to justify such interference. It would be wrong for this Court to substitute its own opinion on where the "public interest" lies simply because members of this Court might attach more importance to legal professional privilege than they feel the Tribunal has done. Given the structure and language of the FOI Act, it would be even more erroneous, in my view, to treat the legal professional privilege exemption in s 32 as incorporating its own internal balance between private rights and the public interest, so as in effect to shield documents covered by s 32 from the "public interest" override afforded to the Tribunal. Such an approach would be incompatible with the language of s 50(4) of the FOI Act. It would amount, in effect, to this Court's performing a legislative act. It would involve adding to the express exclusions from s 50(4) a reference to s 32, despite the fact that the Victorian Parliament obviously decided not to do this. My own initial reading of the reasons of the Tribunal did not persuade me that it had erred in its general approach to its powers under s 50(4). However, having regard to the way in which the appeal to this Court has been argued, I am prepared to accept, for present purposes, that the omissions and suggested errors 75 cf Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 504 [336]; [2001] HCA Kirby of emphasis found by Maxwell P in the Court of Appeal constitute an error of Consequential questions then arise. Was the Court of Appeal authorised and required to substitute its own decision on s 50(4)? If so, was the only conclusion available that the invocation of the public interest override was bound to fail? Or, having regard to the advantages which the Tribunal had, having inspected all of the documents, and the still outstanding issue presented by the State's reliance on s 30 of the FOI Act, was the correct disposition to return the matter to the Tribunal for hearing and determination? Override is available: I cannot agree that the present case could not give rise to a "public interest" consideration capable of enlivening s 50(4) of the FOI Act77. In my respectful opinion, such a conclusion pays insufficient attention to the text and structure of the FOI Act. It fails to reflect the stated purpose and objects of the Act, read against the background of its history. It persists with approaches to the disclosure of official documents that predate the Act. It ignores the advantages which the Tribunal had, having alone inspected all of the relevant documents. I certainly agree with Hayne J that it is impossible to define the "public interest" precisely, in language that will have universal application78. So much would have been known to Parliament when it enacted s 50(4). Nonetheless, the FOI Act commits decisions upon the "public interest" to the Tribunal. Parliament has taken the unusual step of entrusting the Tribunal with a power to displace a ministerial claim of legal professional privilege by reference to its own opinion of what the "public interest" requires. Courts must respect that choice. It would be an error of law for courts, confined to correcting legal error, simply to bypass the Tribunal's decisions as to the "public interest" and to substitute their own opinions as though the Tribunal does not exist. That would involve the courts in usurping the repository of the power selected by Parliament. The fact that, in general, "legal professional privilege represents a particular balancing of public interests"79 must not be permitted to disguise the fact that, in enacting s 50(4) of the FOI Act, the Victorian Parliament committed to the Tribunal the estimation of where the "public interest" ultimately lay. It 76 cf joint reasons at [36]-[40], [52]-[53]. 77 Reasons of Hayne J at [156] citing Osland (2007) 95 ALD 380 at 405 [103] per 78 cf reasons of Hayne J at [137]. 79 Reasons of Hayne J at [141]. Kirby would be to amend the Act, and not to apply it, for this Court to conclude that legal professional privilege involves such important "public interests" that the requisite balance had already been struck by the law, effectively quarantining documents in respect of which legal professional privilege arises from the public interest override in s 50(4). This is not what the FOI Act provides. Recourse to the general language of this Court in Daniels80, arising in a different statutory context in relation to different legislative purposes, ought not to alter the focus of present attention. The importance of legal professional privilege, recognised in s 32 of the FOI Act, may be fully accepted. But it is not insulated from the power that Parliament has entrusted to the Tribunal to override the privilege where the "public interest requires that access to the document should be granted". Judicial statements about the significance of legal professional privilege at common law or in other contexts cannot displace the express instruction of s 50(4). A conclusion that the reasoning of the Tribunal "pays insufficient regard to the public interest considerations which inform and support a client's legal professional privilege"81 amounts, with respect, to little more than the substitution by a court of its own opinion of the "public interest" for that of the body designated by Parliament, namely the Tribunal. The only warrant for a court's intervention upon the Tribunal's exercise of its jurisdiction and power is established error of law. The Tribunal's ample acknowledgment of the importance of legal professional privilege is evident from the ambit which it accorded to the privilege, and from its rejection of the appellant's contentions on waiver. The Tribunal stressed that legal professional privilege protected communications "made in connection with giving or obtaining legal advice or the provision of legal services"82. There is no merit in the claim that the Tribunal neglected the public interest element of legal professional privilege. Approach to transparency: Repeated disparagement of the expression "transparency in government"83 suggests an approach to the FOI Act that I cannot share. In so far as the Tribunal made reference to considerations of transparency, it was correct to do so. As the short title of the FOI Act suggests, as its long title affirms, and as its stated objects demonstrate, the public purpose of the FOI Act is precisely to enhance transparency in government to the extent provided. That 80 (2002) 213 CLR 543 at 552-553 [9]-[11]. 81 Reasons of Hayne J at [146]. 82 Osland (2005) 23 VAR 378 at 386-387 [29] citing Esso (1999) 201 CLR 49 and Daniels (2002) 213 CLR 543. 83 Reasons of Hayne J at [147]-[150]. Kirby object is critical given the oft-repeated instruction of this Court that statutes should be read, so far as their language permits, so as to fulfil their evident purposes84. The Tribunal and the courts must bear in mind the distinctive and radical purposes of the FOI Act, and take particular care when reaching conclusions that appear to frustrate them. Likewise, the Tribunal's reference to the release of the requested documents having the potential to "clear the air"85 with regard to the appellant's situation ought not to be seized upon as indicating a misapprehension that the FOI Act is premised on "a notion of universal access to documents"86. The desirability of "clear[ing] the air" was not mentioned by the Tribunal as though, of itself, it justified a determination that the contested documents should be released pursuant to s 50(4). Rather, that expression appeared in the final sentence of a section of the Tribunal's reasons headed "Public interest factors favouring release"87, which dealt not only with abstract considerations, but also with matters peculiar to the appellant's case. In particular, the Tribunal placed considerable emphasis on the press release's selective revelation of the advice by which the Governor's decision was informed. As the joint reasons demonstrate, the Tribunal's reasons disclose a possibility of material inconsistency between the joint advice and an advice prepared in August 2000 by Mr Robert Redlich QC and his junior ("the Redlich advice")88. In so far as the Tribunal is criticised for a failure to particularise the suggestion of divergence89, I agree with the joint reasons that it is not possible for this Court to exclude the prospect that the Tribunal member was constrained by "a desire not to say too much about the contents of the documents and thereby pre-empt the outcome of the entire dispute"90. By referring to the possibility of inconsistency, an unusual aspect of the present case, and one said to provide "powerful reasons" favouring disclosure of the Redlich advice and other 84 cf CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; [1997] HCA 2; Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 at 112-113; [1997] HCA 53; Project Blue Sky (1998) 194 CLR 355 at 381 [69], 384 85 Osland (2005) 23 VAR 378 at 393 [53]. 86 Reasons of Hayne J at [149]. 87 Osland (2005) 23 VAR 378 at 391-393 [48]-[53]. 88 Joint reasons at [27] referring to Osland (2005) 23 VAR 378 at 392-393 [52]-[53]. 89 cf reasons of Hayne J at [145]. 90 Joint reasons at [28]. Kirby contested documents91, the Tribunal demonstrated its recognition of the need for exceptional circumstances if s 50(4) of the FOI Act were to be applied. There is thus no evidence that the Tribunal misapprehended that the FOI Act provided "that all documents to which a Minister or agency has regard in reaching a decision should be publicly available"92. Such would indeed have evidenced legal error. However, the Tribunal acknowledged the existence of the exemption in respect of legal professional privilege. It afforded a wide ambit to that privilege. It sustained the claim of privilege. But it overrode that claim, as the Act permitted, in the exercise of its exceptional powers under s 50(4). It did so not out of an abstract and general concern to ensure "transparency", but by reference to the unique features of the particular case93. The text and structure of the Tribunal's reasons demonstrate that it fell into no error of the suggested kind. The Tribunal prefaced its consideration of what the "public interest" required in this case by referring to the decision of the Appeal Division of the Supreme Court of Victoria in Director of Public Prosecutions v Smith94. The Appeal Division had there remarked that the formation of an opinion under s 50(4) might involve the "resolution of conflicting public interests"95. It went "There are many areas of national and community activities which may be the subject of the public interest. The statute does not contain any definition of the public interest. Nevertheless, used in the context of this statute it does not mean that which gratifies curiosity or merely provides information or amusement. Similarly it is necessary to distinguish between 'what is in the public interest and what is of interest to know'. On the other hand, 'one feature and one facet of the public interest is that justice should always be done and should be seen to be done'. It is this feature of the public interest, namely the appearance of justice having been done, which is inherent in the proper administration of justice." 91 Osland (2005) 23 VAR 378 at 392 [53]. 92 Reasons of Hayne J at [149] (emphasis in original). 93 cf reasons of Hayne J at [152]. 95 [1991] 1 VR 63 at 72. 96 [1991] 1 VR 63 at 73-74 (citations omitted). Kirby I agree with these observations. I also agree with the additional statement that "[t]he [public] interest is … the interest of the public as distinct from the interest of an individual or individuals"97. The Solicitor-General for Victoria did not contest, but on the contrary accepted, the reasoning in Smith. Its application was properly at the forefront of the Tribunal's attention98. Against this background, it is impossible to accept that the Tribunal failed to give consideration to the particular requirements of the public interest concerning the disclosure of documents in respect of which legal professional privilege had been found and maintained99. The Tribunal's reasons demonstrate precisely the opposite. The conclusion that no "countervailing interest" sufficient to attract s 50(4) was identified in the present case100 does not do justice to the reasoning of the Tribunal. As noted above, that reasoning suggests that there may have been material inconsistency between the joint advice and the Redlich advice. If, as was held in Smith, and as I would accept, there is an important public interest in manifestly just outcomes in the administration of criminal justice, it was open to the Tribunal to conclude that the public interest to which it should ultimately give precedence was the making public of any such inconsistency. In particular, it would have been open to the Tribunal to do so given the high generality of most of the grounds of the petition for mercy; their ostensible focus on broad questions of public interest involving law reform and public policy rather than individual legal rights as such; and the public debate that had taken place following the decision of this Court concerning the ambit and operation of the present law. Producing controversy is legitimate: With respect, the reasons of Bongiorno AJA (with whom Ashley JA relevantly agreed101) in the Court of Appeal reflect, in my view, a superseded approach to the secrecy of internal governmental communications. It is true that, in earlier times, advice to the Governor on a petition for mercy (and virtually everything else) was not susceptible of legal scrutiny. This was, in part, because the documents incorporating the advice were inaccessible and, in part, because of views then held about the "unexaminable prerogative of the Crown"102. 97 [1991] 1 VR 63 at 75. 98 See Osland (2005) 23 VAR 378 at 390 [42]. 99 cf reasons of Hayne J at [152]. 100 cf reasons of Hayne J at [152]. 101 Osland (2007) 95 ALD 380 at 408-409 [116]. 102 Osland (2007) 95 ALD 380 at 410-411 [126], 412 [130]. Kirby Following the enactment of the FOI Act, however, it is seriously erroneous to persist with this old law. The FOI Act creates a "right of access" in respect of documents of "agencies" such as the Department of Justice103. It makes exhaustive provision for the classes of document exempt from this regime. Thus, exemptions must derive from the enacted categories. Those that were invoked in this case were, relevantly, legal professional privilege (s 32) and "internal working documents" (s 30). There is no specific exemption for documents prepared in anticipation of submission to the Governor. Nor are documents in the possession of the Department of Justice relevant to a petition for mercy expressly protected. The extension of the categories of exemption to such documents, as such, cannot be reconciled with the language and scheme of the FOI Act. The suggestion that documents submitted to the Governor should, of their nature, be exempt discloses error on the part of at least two of the three members of the Court of Appeal, requiring the intervention of this Court. It indicates that they reached their conclusion by reference to an irrelevant consideration, and not by the application of the terms of the statute as was their legal duty104. Reinforcing this conclusion, is evident from the reasons of Bongiorno AJA that, in his Honour's opinion, to release the documents claimed would not be in the "public interest" because it "would enable a political collateral attack on the exercise of the prerogative of mercy which would have the effect of changing its fundamental nature"105. Upon this point, I agree with Hayne J that enabling such "attacks" (whether in court, in Parliament, in the media or in the general community) is one of the very purposes of the enactment of such legislation as the FOI Act106. To conceive otherwise is, with respect, to demonstrate a misunderstanding of why the FOI Act was enacted by Parliament. The FOI Act was passed precisely to enhance "transparency in government" in Victoria – just as the Tribunal indicated. Conclusions on override: Given the basis upon which this appeal has been argued, I accept that error attended some parts of the Tribunal's reasoning. However, I do not accept that the appellant's case could give rise to no "public interest" capable of enlivening s 50(4) of the FOI Act. In particular, I note that it was the Tribunal that had the advantage of inspecting all of the relevant documents to reach its conclusion. The Court of Appeal (and this Court) did not 103 FOI Act, s 13. See also ss 3, 5. 104 cf joint reasons at [43]. 105 Osland (2007) 95 ALD 380 at 411 [127]. 106 Reasons of Hayne J at [153]. Kirby have such an advantage. I therefore do not accept that it was open to the Court of Appeal to conclude as it did in relation to the "public interest" override. The proper order Once the foregoing conclusion is reached107, the proper course, on the face of things, is for this Court to remit the entire matter to the Tribunal. That course would have the advantage of permitting the Tribunal, if it were still relevant, to consider the outstanding issue of the claim for exemption based on s 30 of the FOI Act. Because s 30 is also subject to the public interest override in s 50(4), the Tribunal did not consider it separately. In my view, this involved a legal error. It is at least possible that, if the exemption under s 30 were made good and s 50(4) were found to be inapplicable to that ground of exemption, that conclusion could affect the final decision on the "public interest" claimed in respect of legal professional privilege. The one, at least conceivably, might impinge on the decision upon the other. However, as the joint reasons point out108, the Court of Appeal was not obliged to remit the proceedings to the Tribunal. It was empowered to deal with the s 50(4) issue for itself. I will not press my own preference for a general remittal to the Tribunal by proposing orders to that effect. The Court of Appeal could still decide that a general remittal is the appropriate course for it to adopt. It might do so in order to maintain the correct relationship between itself and the Tribunal, and out of recognition of, and respect for, Parliament's choice of the Tribunal as the primary repository of the override power afforded by s 50(4) of the FOI Act. As the Tribunal reached its conclusion on the "balance" of the public interest having inspected the relevant documents, I do not consider that the Court of Appeal could reach a contrary conclusion, at least without examining the documents for itself. Having done so, and having put to one side the supposed exclusion of documents material to the exercise of the prerogative of mercy from the s 50(4) override, it is possible that the Court of Appeal might reconsider both the additional claim for exemption based on s 30 of the FOI Act and the suggestion (rejected by the Tribunal) of providing an edited version of the documents109. 107 cf joint reasons at [58]. 108 Joint reasons at [58]. 109 See Osland (2005) 23 VAR 378 at 389 [38]. Kirby Given the high generality of most of the stated grounds in the appellant's petition, it seems most unlikely to me that it would be against the public interest to disclose any of the contents of the documents to the appellant, and thus to her supporters, the media and the community generally. The fact that their disclosure might enliven more public debate, or even possibly lead on to further legal process, is not a reason for withholding the documents. The promotion of informed discussion on matters of public importance is exactly what the FOI Act was generally intended to secure. With that fact reaffirmed by this Court, the final order in the Court of Appeal may be left to that Court. Orders The orders proposed in the joint reasons should be made. Hayne 131 HAYNE J. For the reasons given by Gleeson CJ, Gummow, Heydon and Kiefel JJ, the appellant's contention that the press release issued by the Attorney-General for Victoria on 6 September 2001 waived legal professional privilege in respect of the Joint Memorandum of Advice of Senior Counsel to which the appellant sought access should be rejected. These reasons are directed to the appellant's argument that the Court of Appeal erred in holding that there was no basis upon which, on the material before the Victorian Civil and Administrative Tribunal ("the Tribunal"), the Tribunal could conclude that the public interest required that access be granted under s 50(4) of the Freedom of Information Act 1982 (Vic) ("the FOI Act") to documents identified as otherwise subject to legal professional privilege. The appellant's argument about the application of s 50(4) in this case should be rejected. On the material before the Tribunal it was not open to the Tribunal to find that the public interest required that the appellant be granted access to the documents in question. At the time of the hearing before the Tribunal, s 50(4) of the FOI Act provided that: "On the hearing of an application for review the Tribunal shall have, in addition to any other power, the same powers as an agency or a Minister in respect of a request, including power to decide that access should be granted to an exempt document (not being a document referred to in section 28, section 29A, section 31(3), or in section 33) where the Tribunal is of opinion that the public interest requires that access to the document should be granted under this Act." This provision was referred to in argument as the "public interest override provision" and it is convenient to adopt that description. Before dealing with its application in this matter, however, it is necessary to say something about other provisions of the FOI Act. Section 3 of the FOI Act provided that the object of the Act "is to extend as far as possible the right of the community to access to information in the possession of the Government of Victoria", and certain other bodies, by the particular means identified in s 3(1)(a) and (b). It is the second of those stated means (described in s 3(1)(b)) that is of present relevance. That paragraph spoke "creating a general right of access to information in documentary form in the possession of Ministers and agencies limited only by exceptions and exemptions necessary for the protection of essential public interests and the private and business affairs of persons in respect of whom information is collected and held by agencies". Hayne Section 3(2) provided that: "It is the intention of the Parliament that the provisions of this Act shall be interpreted so as to further the object set out in sub-section (1) and that any discretions conferred by this Act shall be exercised as far as possible so as to facilitate and promote, promptly and at the lowest reasonable cost, the disclosure of information." The right of access to documents created by the FOI Act was identified in s 13. That section provided that: "Subject to this Act, every person has a legally enforceable right to obtain access in accordance with this Act to – a document of an agency, other than an exempt document; or an official document of a Minister, other than an exempt document." It is to be noted that the right is stated to be "[s]ubject to this Act" and further that the right is to obtain access to a document "other than an exempt document". It follows that the premise for the operation of s 50(4), the public interest override provision, is that the document in question is one to which the applicant has no right to access. The applicant has no right to access because, by hypothesis, the document is an exempt document and the right which is created by s 13 is a right to obtain access to certain documents "other than an exempt document". Section 50(4) could be engaged only on an application for review by the Tribunal and only in respect of a review of a kind referred to in s 50(2). Those reviews included, but were not limited to, the review of "a decision refusing to grant access to a document in accordance with a request"110. Section 50(4) provided that, on the hearing of such an application for review, "the Tribunal shall have ... the same powers as an agency or a Minister in respect of a request". Those powers included the power to decide that access should be granted to an exempt document unless the document was one referred to in s 28 (which dealt with Cabinet documents), s 29A (which dealt with documents affecting national security, defence, or international relations), s 31(3) (which dealt with documents created by the Bureau of Criminal Intelligence), or s 33 (which dealt with documents affecting personal privacy). The condition stated in s 50(4) for the exercise of the power to decide that access should be granted to an exempt document was "where the Tribunal is of opinion that the public interest requires that access to the document should be 110 s 50(2)(a). Hayne granted under this Act" (emphasis added). The power of decision thus given to the Tribunal "is neither arbitrary nor completely unlimited"111. But the only definition of the content of the power lies in the expression "the public interest requires". As was pointed out in O'Sullivan v Farrer112: "[T]he expression 'in the public interest', when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only 'in so far as the subject matter and the scope and purpose of the statutory enactments may enable ... given reasons to be [pronounced] definitely extraneous to any objects the legislature could have had in view'113." It may also be accepted that questions about what is in "the public interest" will ordinarily require consideration of a number of competing arguments about, or features or "facets" of, the public interest114. And as was pointed out in McKinnon v Secretary, Department of Treasury115, "a question about 'the public interest' will seldom be properly seen as having only one dimension". The reference in s 50(4) to what the public interest requires is not susceptible of definition by charting the metes and bounds of "public interest" or by providing a list of considerations that may properly bear upon that interest. The question for a court considering a conclusion reached by the Tribunal that the public interest requires that access to certain documents should be granted under the FOI Act will in many, perhaps most, cases focus upon whether a consideration taken into account by the Tribunal is extraneous to the power conferred by s 50(4)116. But because the Tribunal must state its reasons for decision it will also be possible to determine whether the reasons given were such as could support the conclusion that the public interest required disclosure of the documents. 111 Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 505; [1947] HCA 21. 112 (1989) 168 CLR 210 at 216; [1989] HCA 61. 113 Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 114 McKinnon v Secretary, Department of Treasury (2006) 228 CLR 423 at 443 [55]; [2006] HCA 45. 115 (2006) 228 CLR 423 at 444 [55]. 116 Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR Hayne The particular species of exempt documents which had to be considered in the present matter was identified by s 32(1) of the FOI Act. Each of the documents in issue was "of such a nature that it would be privileged from production in legal proceedings on the ground of legal professional privilege"117. Although, as noted earlier, the public interest override provision of the FOI Act excluded some species of exempt documents from its operation, s 32(1) was not among the exclusions. That is, s 50(4) did not exclude from its field of possible operation documents to which legal professional privilege attaches. Section 50(4) may thus be seen to have been framed on the assumption that there might be cases in which the public interest would require disclosure of a document to which legal professional privilege attached. In deciding whether the public interest requires that access be granted to documents that otherwise are exempt from production under the FOI Act because the client has and maintains legal professional privilege in respect of those documents, it is of the very first importance to begin from the recognition that legal professional privilege represents a particular balancing of public interests. The privilege strikes the balance by providing that, absent statutory provision to the contrary, it is for the client, and only the client, to decide whether the privilege should be waived and the documents made available for inspection under otherwise compulsory processes. That is, despite the general public interest "which requires that in the interests of a fair trial litigation should be conducted on the footing that all relevant documentary evidence is available"118, the public interest which underpins the client's legal professional privilege is given paramountcy, and the documents "would be privileged from production in legal proceedings". It would be wrong, however, to attach undue importance to the reference in s 32(1) to production of documents in legal proceedings. In particular, it would be wrong to construe or apply the relevant provisions of the FOI Act on an assumption that s 32(1) is directed only to a rule of evidence in litigation. The course of decisions in this Court shows that legal professional privilege is not just a rule of evidence. As the reasons of the plurality in Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission pointed out119: 118 Grant v Downs (1976) 135 CLR 674 at 685; [1976] HCA 63. 119 (2002) 213 CLR 543 at 552-553 [9]-[11]; [2002] HCA 49. Hayne "It is now settled that legal professional privilege is a rule of substantive law120 which may be availed of by a person to resist the giving of information or the production of documents which would reveal communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services, including representation in legal proceedings. ... Being a rule of substantive law and not merely a rule of evidence, legal professional privilege is not confined to the processes of discovery and inspection121 and the giving of evidence in judicial proceedings122. Rather and in the absence of provision to the contrary, legal professional privilege may be availed of to resist the giving of information or the production of documents in accordance with investigatory procedures of the kind for which s 155 of the [Trade Practices Act 1974 (Cth)] provides. Legal professional privilege is not merely a rule of substantive law. It is an important common law right or, perhaps, more accurately, an important common law immunity." It is thus to be observed that the balance which legal professional privilege strikes in favour of maintaining confidentiality of certain communications is fixed despite not only a competing public interest in the fair trial of litigation (civil and criminal), but also the competing public interests which underpin particular statutorily created processes for compulsory disclosure of documents or information. In the present case, the Tribunal made some observations in its reasons for decision123 about "the importance of maintaining legal professional privilege generally" and referred to this Court's decision in Daniels Corporation124. The 120 Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 490 per Deane J; [1986] HCA 80. 121 See, with respect to discovery and inspection, Mann v Carnell (1999) 201 CLR 1; [1999] HCA 66. 122 See Baker v Campbell (1983) 153 CLR 52 at 115-116 per Deane J; [1983] HCA 39; Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 55 [4] per Gleeson CJ, Gaudron and Gummow JJ; [1999] HCA 67; Mann v Carnell (1999) 201 CLR 1 at 10-11 [19] per Gleeson CJ, Gaudron, 123 Osland v Department of Justice (2005) 23 VAR 378 at 390 [43]. 124 (2002) 213 CLR 543. Hayne Tribunal went on to say125, however, that "the nature and strength of the factors that warrant the non-disclosure of a document on the ground of legal professional privilege will vary from case to case" and that: "[a]lthough the maintenance of legal professional privilege will generally be a public interest of high order (and will also involve important matters of private interest), the strength of those interests will be greater in some cases than others". The reasons of the Tribunal show that one consideration was identified as dominating other relevant considerations. The dominant consideration was126 that: "[a]s a general proposition it can be said that there is a public interest in information being freely available to enable members of the public to intelligently consider and discuss decisions of the executive branch of government". More particularly127: "where a government decision is made in relation to a petition of mercy, relying upon particular advice which is specifically referred to, there will be a strong public interest in also making available any other advice that has been obtained in relation to the same question. If a decision-maker obtains advice from two sources and receives different advice, the public might be misled if it is told that a decision has been made on the basis of advice (specifying the advice) without reference to the fact that there was If only one advice is specified in such also different advice. circumstances an impression may be created that the decision-maker really had no choice; whereas if the two different advices are specified the public might think that there was a choice to be made by the decision-maker and wish to know why a particular choice was made." It was on this footing that the Tribunal concluded128 that "[i]n order to clear the air and properly inform the public" all of the documents in respect of which legal professional privilege was maintained should be made available. 125 (2005) 23 VAR 378 at 390-391 [44]. 126 (2005) 23 VAR 378 at 391 [48]. 127 (2005) 23 VAR 378 at 392 [52]. 128 (2005) 23 VAR 378 at 393 [53]. Hayne The Tribunal did not found its conclusion that the public interest required disclosure of all of the documents for which legal professional privilege was maintained on any perceived contrariety or discordance between the content of the several documents. Although the Tribunal referred to the possibility that the decision-maker (here, the Attorney-General) had obtained different, even conflicting, legal advice about an issue, the Tribunal did not make any finding that the documents which it had inspected showed this to be such a case. Rather, the Tribunal founded its decision in a stated need to "clear the air", and in the conclusion that this could be done only by making all documents touching or concerning the appellant's petition for mercy available for public examination. This reasoning, if it is not circular, pays insufficient regard to the public interest considerations which inform and support a client's legal professional privilege. References to clearing the air, or more general references of the kind made in oral argument in this Court to a need for "transparency" in government are, at best, statements of the values that are to be understood as informing the structure and operation of the FOI Act. Neither reference to clearing the air, nor reference to a need for transparency in government, reveals the reasoning that supports a conclusion that the public interest requires disclosure of what otherwise is privileged from compulsory disclosure. It is convenient to illustrate the difficulties just described by reference to the idea of transparency in government. The expression "transparency in government" appeared to be used in the oral argument of the present matter in a way that presupposed that all documents to which the person or agency subject to the FOI Act has regard in reaching a decision should be available for public examination. Only if that is so was it said that decision-making could be "fully transparent". Understood in those terms, references to "transparency" proceed from a premise that is contradicted by the express terms of the FOI Act. The FOI Act does not provide that all documents to which a Minister or agency has regard in reaching a decision should be publicly available. Some documents (including documents in respect of which legal professional privilege is maintained) are exempt documents. Likewise, references to "clearing the air" may embrace a notion of universal access to documents and, if that is so, these references, too, proceed from a premise that is contradicted by the express provisions of the FOI Act. the extent to which expressions the air" or "transparency" do not assume that there should be public access to all documents available to a decision-maker, they do not provide useful guidance in answering the relevant statutory question: does the public interest require that access to the documents should be granted? In particular, the use of these expressions serves like "clearing Hayne only to mask what it is that underpins a conclusion that the public interest override provision applies. Legal professional privilege gives effect to a particular balancing of public interests. The balance is struck in favour of confidentiality unless the client waives the privilege. A government client, whether a Minister or some other agency, obtaining legal advice to which legal professional privilege attaches is not in any different position from any other client129 except to the extent provided for by the FOI Act. identified as supporting Unless particular considerations are the conclusion that the public interest requires disclosure of particular documents in respect of which legal professional privilege is maintained, the public interest in the maintenance of the client's privilege is not to be set aside. It is to be expected (at least in all but the most exceptional case) that any such countervailing consideration could be described with particularity and that it would be an interest of weight and substance. So much follows from the considerations of public interest that underpin the privilege, and from the fact that s 50(4) is not engaged unless the Tribunal is of the opinion that the public interest requires disclosure of the documents in question. But no countervailing interest was identified in the present case beyond the invocation of a general proposition about the desirability of clearing the air and a general assertion that there is a public interest in information being fully available. In the Court of Appeal, Bongiorno AJA approached the question of public interest by examining whether an exercise of the prerogative of mercy was judicially reviewable. Having concluded that it was not, Bongiorno AJA held130 that to release the documents now in question was not in the public interest because it "would enable a political collateral attack on the exercise of the prerogative of mercy which would have the effect of changing its fundamental nature". It is not necessary to decide whether, or to what extent, the exercise of the prerogative of mercy may be subject to judicial review. It is sufficient to say that using documents to which access is obtained under the FOI Act to bring public or other forms of political pressure to bear upon the Executive Government will often be a purpose underpinning the making of a request under the Act. The possibility of such use of documents obtained under the FOI Act is not foreign to the purposes of the FOI Act; it is not a reason that weighs against disclosure of particular documents under the FOI Act, whether in exercise of the power given by s 50(4) or otherwise. 129 Attorney-General (NT) v Kearney (1985) 158 CLR 500; [1985] HCA 60; Waterford v The Commonwealth (1987) 163 CLR 54; [1987] HCA 25. 130 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 411 [127]. Hayne In so far as the Tribunal's reasons in this case are to be understood as suggesting that there may have been some contrariety between the separate pieces of legal advice made available to the Attorney-General in relation to the appellant's petition for mercy, two points must be made. First, as noted earlier, the Tribunal made no finding that there was any contrariety. Secondly, if there were, that fact, standing alone, would not support the conclusion that the public interest required disclosure of some or all of the advices in question. It would not support that conclusion because legal professional privilege is not confined to such advice as appears, on later examination, to be legally or factually sound and well-based. And if conflicting advice was proffered to the Attorney-General in the present matter, his adoption of one strand of advice, in preference to one or more different views, does not present any issue about public interest. Whether questions of public interest could arise if there were some suggestion that the accuracy of what was said publicly about a matter could be disputed if access were to be provided to otherwise exempt documents is not a question that now arises. No suggestion of that kind was made in the Tribunal, or in the Court of Appeal, and there was no foundation for a suggestion of that kind. There was no foundation for such a suggestion because the little that was said publicly about the appellant's petition for mercy did no more than refer to the taking of the joint advice of senior counsel. No mention was made of any other advice. It follows that Maxwell P was right to conclude131 that "the circumstances of the present case give rise to no public interest consideration which would be capable of satisfying the test in s 50(4) so as to require disclosure of the legal advices". Apart from references to "clearing the air" and to "transparency", no consideration was identified, whether in the reasons of the Tribunal or in argument in this Court or below, which could be put against maintenance of the legal professional privilege found to attach to these documents. That being so, regardless of the particular contents of the documents in question, s 50(4) was not engaged. It also follows that, contrary to the appellant's submissions, it was not necessary in these circumstances for the Court of Appeal to examine the documents that were in issue. It is not necessary to consider the further questions touched on in oral argument in this Court about the ambit of the operation of the provisions of s 30 of the FOI Act concerning internal working documents. The appeal to this Court should be dismissed. The respondent sought no order as to costs. 131 (2007) 95 ALD 380 at 405 [103]. Hayne
HIGH COURT OF AUSTRALIA AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER APPELLANT AND CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION & ANOR RESPONDENTS Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3 14 February 2018 ORDER Leave is granted for the appellant to amend the notice of appeal in the manner set out in the proposed amended notice of appeal exhibited to the affidavit of Brendan Charles dated 10 November The appellant pay the first and second respondents' costs of, and incidental to, the application to amend the notice of appeal. Appeal allowed. Set aside order 2 of the orders made by the Full Court of the Federal Court of Australia on 21 December 2016 and, in its place, order that orders 7 to 13 of Mortimer J made on 13 May 2016 be set aside. Remit the matter to the Full Court of the Federal Court of Australia for the re-imposition of penalties according to law. On appeal from the Federal Court of Australia Representation T M Howe QC with C J Tran for the appellant (instructed by Sparke Helmore) R M Doyle SC with J D Watson for the respondents (instructed by Slater & Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union Industrial law – Pecuniary penalties – Where union official contravened civil remedy provision of Fair Work Act 2009 (Cth) – Where union contravened civil remedy provision through union official's conduct – Where s 546 of Fair Work Act provides court can order person to pay pecuniary penalty – Where s 545(1) of Fair Work Act provides court can make any order it considers appropriate if satisfied person contravened, or proposes to contravene, civil remedy provision – Where pecuniary penalties imposed on both union official and union – Whether s 545(1) or s 546 of Fair Work Act or s 23 of Federal Court of Australia Act 1976 (Cth) empowers court to order that union not indemnify union official against pecuniary penalty – Whether s 545(1) or s 546 of Fair Work Act or s 23 of Federal Court of Australia Act empowers court to order that union official not seek or accept indemnity or contribution from union in respect of pecuniary penalty. Words and phrases – "appropriate", "Bragdon order", "civil remedy provision", "deterrence", "implied power", "legally ancillary", "non-indemnification order", "pecuniary penalty", "penal outcome", "penal purpose", "person other than the contravener", "personal payment order", "reasonably required". Fair Work Act 2009 (Cth), ss 545, 546, 564. Federal Court of Australia Act 1976 (Cth), s 23. KIEFEL CJ. Proceedings were brought in the Federal Court by the statutory predecessor to the Australian Building and Construction Commissioner ("the ABCC") against the first respondent, the Construction, Forestry, Mining and Energy Union ("the CFMEU"), and the second respondent, Mr Joseph Myles, who was a Vice President of the Construction and General Division of the CFMEU at the relevant time, for contraventions of s 348 of the Fair Work Act 2009 (Cth) ("the FWA"). Section 348 prohibits the taking or organising of action against another person, or threatening to take or organise action, with the intention of coercing a person to engage in industrial activity. The conduct in question was directed by Mr Myles to a representative of the joint venturers of a large construction project for the Victorian Government. Mr Myles demanded that there be a CFMEU delegate on the site. There was no dispute that this constituted a demand that the joint venturers engage in industrial activity within the meaning of s 347. The joint venturers did not agree that this was necessary, as there was a delegate of another industrial organisation, which was a party to the existing Enterprise Agreement, already on site. Mr Myles then organised and participated in a blockade of an entrance to the site which prevented wet concrete being delivered with the result that large quantities of it were spoiled, and concrete which had previously been poured was wasted. He threatened to again blockade the entrance the following day if the CFMEU was not permitted to have a delegate on site. Shortly before the hearing of the charges against them was due to commence, the CFMEU and Mr Myles admitted the conduct in question had taken place with the intention of coercing the joint venturers to comply with Mr Myles' demands. They admitted that Mr Myles, and through him the CFMEU1, contravened s 348. The primary judge, Mortimer J, made declarations of contravention and imposed pecuniary penalties on both the CFMEU and Mr Myles2. Section 348 is a "civil remedy provision" of the FWA3 for which a maximum penalty is provided in the event of contravention4. At the time of the contravening conduct in May 2013, the maximum penalty that could be imposed for each contravention on the CFMEU was $51,000, and the maximum penalty that could be imposed for each contravention on Mr Myles was $10,200. The CFMEU and Mr Myles 1 See Fair Work Act 2009 (Cth), s 363(1)(b). 2 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436. 3 Fair Work Act 2009 (Cth), ss 539(1), 539(2). 4 Fair Work Act 2009 (Cth), s 539(2). were each found to have engaged in three contraventions of s 348 of the FWA. The primary judge ordered that the CFMEU pay total pecuniary penalties of $60,000 to be paid within 30 days and Mr Myles $18,000 to be paid within 90 days. The initial question on this appeal concerns the further order which her Honour made, which the parties on the appeal referred to as the "non- indemnification order". It is in these terms: "The first respondent must not directly or indirectly indemnify the second respondent against the penalties in paragraphs 9 and 10 above in whole or in part, whether by agreement, or by making a payment to the Commonwealth, or by making any other payment or reimbursement, or howsoever otherwise." The primary judge identified the source of the power to make the order as s 545(1) of the FWA5. The Full Court of the Federal Court (Allsop CJ, North and Jessup JJ) allowed the appeal brought by the CFMEU and Mr Myles, holding that neither s 545(1) nor s 23 of the Federal Court of Australia Act 1976 (Cth) ("the FCAA") provides the necessary power6. An application by the ABCC, made subsequent to the hearing of this appeal, to amend the Notice of Appeal directs attention to s 546(1) as the source of a power to make an order which might achieve the deterrent effect upon both Mr Myles and the CFMEU contemplated by the primary judge. Unlike the non- indemnification order, an order of this kind (a "personal payment order") would be directed only to Mr Myles and would prohibit him from seeking indemnification from the CFMEU with respect to payment of the penalty. Provisions of the FWA Section 23 of the FCAA may be put to one side for present purposes. Section 546(1) of the FWA provides that the Federal Court, and other eligible State or Territory courts: "… may, on application, order a person to pay a pecuniary penalty that the court considers is appropriate if the court is satisfied that the person has contravened a civil remedy provision." 5 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [201]. 6 Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner (2016) 247 FCR 339 at 343 [15], 345 [26], 355 [66]. As mentioned, s 348 is a civil remedy provision. Section 546(2) provides that the pecuniary penalty made under s 546(1) must not, in the case of an individual, be more than the maximum allowed under s 539(2), or, in the case of a body corporate, five times the maximum allowed under s 539(2). The court may order that the pecuniary penalty, or part of it, be paid to the Commonwealth or a particular organisation or person7 and it may be recovered as a debt due to that person8. Section 546(5) provides: "To avoid doubt, a court may make a pecuniary penalty order in addition to one or more orders under section 545." Section 545(1) provides: "The Federal Court … may make any order the court considers appropriate if the court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision." Section 545(2) provides: "Without limiting subsection (1), orders the Federal Court … may make include the following: an order granting an injunction, or interim injunction, to prevent, stop or remedy the effects of a contravention; an order awarding compensation for loss that a person has suffered because of the contravention; an order for reinstatement of a person." Section 545(4) provides that a court may make an order under s 545 on its own initiative, or upon application to it. Section 564 provides: "To avoid doubt, nothing in this Act limits the Federal Court's powers under section 21, 22 or 23 of the Federal Court of Australia Act 1976." 7 Fair Work Act 2009 (Cth), s 546(3). 8 Fair Work Act 2009 (Cth), s 546(4). The primary judge's reasoning The imposition of penalties In considering matters relating to penalty, the primary judge referred to a number of factors. Chief amongst them were the history of contraventions by the CFMEU and Mr Myles, and the role of deterrence, both general and specific, in fixing a penalty9. In relation to general deterrence, the primary judge said that, in fixing a penalty, the court must "make[] it clear to [the contravener] … that the cost of courting a risk of contravention … cannot be regarded as [an] acceptable cost of doing business"10. However, general deterrence did not loom as large as specific deterrence in her Honour's reasons. The CFMEU and Mr Myles submitted to the primary judge that it was impermissible, in fixing a penalty, to reason that previous penalties had been ineffective11. Her Honour rejected that submission. Her Honour inferred that the CFMEU employs a conscious and deliberate strategy to engage in disruptive, threatening and abusive behaviour towards employers without regard to the lawfulness of that action or the prospect of prosecution or penalties. The individuals involved in this conduct are often part of the CFMEU hierarchy and their ongoing behaviour is tolerated, facilitated and encouraged by all levels of the organisation. Her Honour considered that penalties needed to be fixed so as to provide specific deterrence to the CFMEU and to Mr Myles, and observed that this would be his fifth set of contraventions12. There can be no doubt that the primary judge was applying s 546 in determining the penalties to be imposed on each of the CFMEU and Mr Myles, but her Honour did not resort to that section in making the non-indemnification order. 9 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [128]. 10 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [133], quoting Singtel Optus Pty Ltd v Australian Competition and Consumer Commission (2012) 287 ALR 249 11 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [137]. 12 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [144]-[145]. The non-indemnification order In addition to an order prohibiting the CFMEU from paying the penalty ordered against Mr Myles, the ABCC sought an order requiring Mr Myles to pay the penalty from his own funds, but her Honour declined to do so13, leaving him free to seek the funds from sources other than the CFMEU. The prohibition was directed only to the CFMEU. Her Honour did not take the course of prohibiting Mr Myles from receiving monies from the CFMEU in order to pay the penalty. It would appear that although an order of this kind was initially sought, her Honour was encouraged by the ABCC to conclude that a non-indemnification order would be more appropriate. The primary judge considered the history of contraventions by the CFMEU and Mr Myles and the role of deterrence in the imposition of penalties in determining to make the non-indemnification order against the CFMEU. Her Honour said that the history of contraventions showed that it was appropriate to make "some kind of additional order" so as to give "real effect to the principles of specific deterrence"14. Her Honour found that the CFMEU and Mr Myles had engaged in conduct on the understanding that any penalties imposed would be paid for from funds held by the CFMEU which had been received from its members or alternatively from public funds. If Mr Myles was indemnified, the object of specific deterrence would be "diminished almost to the point of disappearance", her Honour said15. On the other hand, a non-indemnification order would cause the CFMEU to think about the penalties to which its officials might be exposed and Mr Myles to think about his exposure, thereby achieving a deterrent effect with respect to both contraveners16. The primary judge rejected the submission that s 546(1) was the only relevant source of power "in relation to payment of penalties for contraventions" and that the more general power in s 545(1) did not extend to orders of the kind in question17. Her Honour considered s 545(1) to be a wide power which may 13 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [164]-[165]. 14 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [196]. 15 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [190]. 16 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [191]. 17 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [173] (emphasis added). support a range of orders, so long as those orders are consistent with the relevant purpose of that power18. Section 545(1) and the non-indemnification order It cannot be doubted that s 546(1) is the sole source of the power for the Federal Court to make an order that a person pay a pecuniary penalty when that person has contravened a civil remedy provision. The specific grant of power in s 546(1) involves a denial of a power to do the same thing in the same case free from the conditions and the qualification prescribed by the provision19. The primary judge's reasons do not suggest that her Honour regarded s 545(1) as containing a power to penalise; rather, her Honour considered it might be used in aid of, and to reinforce, the penalty imposed under s 546(1). Section 545(1) is not directed to the subject of penalties. By its terms, its sphere of operation is circumscribed. The express terms of s 545(1) permit the Federal Court only to make orders which it considers to be "appropriate" in the circumstance where it is satisfied that a person has contravened or proposes to contravene a civil remedy provision. The Court is therefore restricted to making the kinds of orders which are capable of properly being seen as appropriate to be made by the Court in the exercise of its jurisdiction. The ABCC's reliance on the principle that a power conferred on a court should not be construed by reference to unexpressed limitations20 is misplaced. The terms of s 545(2) do not suggest that s 545(1) should be read more widely. Its opening words, "[w]ithout limiting subsection (1)", go no further than to ensure that s 545(1) is not read down in light of the specific orders set out in s 545(2) as examples of what orders may be made under s 545(1)21. In stating that "orders the Federal Court … may make include the following", s 545(2) is to be read as conferring power to make orders of the kinds specified whether or not orders of those kinds would always or sometimes fall within the scope of s 545(1). Section 545(2) is not cast as an amplification of the power conferred 18 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [176]. 19 Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 8; [1932] HCA 9. 20 Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 421; [1994] HCA 54. See also Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 205; [1992] HCA 28. 21 Leon Fink Holdings Pty Ltd v Australian Film Commission (1979) 141 CLR 672 at 679-680; [1979] HCA 26. by s 545(1). Section 545(2) cannot be read as if it commenced, "The orders the Federal Court may make under subsection (1) include, but are not limited to, the following". The terms of s 545(2) provide the context for the kinds of orders which may be made under s 545(1). The examples given in s 545(2) are directed to preventing contraventions or addressing or remedying the effects of a contravention, including compensating victims of a contravention. A non- indemnification order is not an order of these kinds. It is addressed to the penalty made in s 546(1). The presence of s 546(5) and s 545(4)(a) does not illuminate the scope of the power conferred by s 545(1). Section 546(5) means no more than it says: that "a court may make a pecuniary penalty order in addition to one or more orders under section 545". That a court can act on its initiative, as s 545(4)(a) provides, adds nothing to the power with which it is provided. The ABCC sought to draw an analogy between a freezing order and a non-indemnification order. However, the purpose of a freezing order is in no way comparable to an order of the kind here in question. The purpose of a freezing order is to prevent a defendant from disposing of his or her assets. It is the paradigm example of an order which is intended to prevent the frustration of the court's processes22. It is granted to facilitate the process of execution or enforcement of a prospective money judgment23 and to protect the integrity of the court's processes once they have been set in motion24. Similarly, an asset preservation order might properly restrain dealings by judgment debtors with their property for such period as would allow a judgment creditor to move A non-indemnification order cannot be said to be necessary for the enforcement of a pecuniary penalty order. The process for enforcement of a pecuniary penalty order under the Act is recovery of the amount of the pecuniary 22 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 18 [43]; [2015] HCA 36, quoting Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 32 [35]; [1998] HCA 30. 23 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 19 [46]. 24 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 393 [25]; [1999] HCA 18, referring to CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 at 391; [1997] HCA 33. 25 Pelechowski v Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 at 452 [52]; [1999] HCA 19. penalty as a debt. It cannot be said to render the process of enforcement more efficacious, given that it denies the person the subject of the pecuniary penalty order a potential source of funds to pay it. A purpose to enhance a pecuniary penalty order by making its effects felt more severely may be consonant with the power given by s 546(1) but it is not the purpose with which s 545(1) is concerned. The ABCC submitted that without the order the penalty is ineffective as a deterrent because it has no severity for Mr Myles and the penalty would be indistinguishable from a single high penalty. Without the order, the penalty is simply the price of doing business, as the primary judge had found26 again. It may be observed that these submissions are directed to the efficacy of the penalty rather than the court's processes or the enforcement of its orders. Section 545(1) of the FWA does not provide a general power to add to or enhance the effect of other remedies or orders such as a pecuniary penalty order. In Pelechowski v Registrar, Court of Appeal (NSW)27, Gaudron, Gummow and Callinan JJ, after observing that an asset preservation order for a short period might have been considered reasonably required in aid of execution, explained that the effect of an order made under the court's inherent power which restrained the judgment debtors altogether from selling their only asset was to give the judgment creditor additional security and could not be regarded as reasonably required for execution. In Jackson v Sterling Industries Ltd28, Deane J said that the purpose of an order for the preservation of assets is not to create security for the plaintiff but to prevent the defendant from frustrating the processes of the court. Likewise, the power given under s 545(1) is not to add to the penalty made under s 546(1). The primary judge was minded to make the non-indemnification order because her Honour considered that it was consistent with the purpose of a pecuniary penalty order that it have a stronger deterrent effect. Her Honour said that the "effectiveness of an exercise of judicial power to impose penalties is significantly impaired where the reality is that the contravener is likely to be entirely indemnified from the consequences of the order"29. 26 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [142], [196]. 27 (1999) 198 CLR 435 at 452 [53]-[54]. 28 (1987) 162 CLR 612 at 625; [1987] HCA 23. 29 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [190]. The power to which her Honour refers is, of course, that arising under s 546(1). Deterrence is undoubtedly a purpose of a pecuniary penalty order made under s 546(1), but it is not a purpose of s 545(1). Accepting that s 545(1) is not the source of a power to make an order designed to achieve the effects of which the primary judge spoke, because such an order is neither appropriate nor necessary in the context of s 545(1), attention is then directed to s 546(1) and to the application by the ABCC to amend the Notice of Appeal to rely upon it. The application for leave to amend In submissions in reply on the hearing of this appeal the ABCC suggested that if the primary judge had been wrong about the source of the power to make the non-indemnification order residing in s 545(1), the order could nevertheless be justified by reference to s 546(1). A suite of incidental powers attaches to s 546(1). These powers might include a power to make a non-indemnification order if it was necessary to achieve the deterrent effect which is the principal concern of the provision, it was submitted. The Notice of Appeal to this Court raised no issue concerning s 546(1). In these circumstances it is understandable that the CFMEU and Mr Myles did not seek to respond to the ABCC's argument. Following the hearing of the appeal, the Court sought further submissions from the parties. The ABCC's further submissions were accompanied by an application to amend the Notice of Appeal to rely upon s 546(1) as a source of power. The order which it was said could be made under s 546(1) was an order that Mr Myles not seek or receive indemnification from the CFMEU, which is to say a personal payment order. It is not doubted that this Court may entertain the question concerning s 546(1), being seized of the entire matter on appeal30. In the present case the arguments on the appeal addressed both s 545(1) and s 546(1). The different purpose of each sub-section, their operation and their relationship to each other were fully ventilated at the hearing. The question whether a personal payment order could be made under s 546(1) is a question of law. The CFMEU and Mr Myles accept that they would not have adduced any different evidence if the issue had been raised by the Notice of Appeal. They do not point to any real prejudice. The question whether there is a source of power within the FWA for an order of the kind in question is 30 Gipp v The Queen (1998) 194 CLR 106 at 116 [23]; [1998] HCA 21. an important one, which has produced differences of view in the Federal Court31 and which should be resolved. In these circumstances there should be a grant of leave to amend on condition that the ABCC pay the CFMEU's and Mr Myles' costs which have been occasioned by it and by the further submissions. Section 546(1) – a necessary implication? Unlike s 545(1), s 546(1) contains an express conferral of jurisdiction with respect to the making of a pecuniary penalty order. It is expressed as a power to order "a person to pay" a pecuniary penalty that the court considers is appropriate in the event of contravention. As the CFMEU and Mr Myles observe, s 546(1) is therefore not support a directed only non-indemnification order of the kind made by the primary judge against the CFMEU, because it is directed to a third party. The question then is whether it could support a personal payment order directed only to Mr Myles. to a contravener. It would Every court possesses jurisdiction arising by implication, upon the principle that a grant of power carries with it everything necessary for its exercise32. The term "necessary" in connection with the implied power is to be understood as identifying a power to make orders which are reasonably required or legally necessary to the accomplishment of what is specifically provided to be The question here is whether the express power given by s 546(1) to require that a person pay a penalty carries with it a power to ensure that Mr Myles' penalty not be paid by the CFMEU in order that the effect of the penalty to a much greater extent be felt by him. It is difficult to see how that could not be seen as necessary to the exercise of the power given by s 546(1), particularly when regard is had to its principal, if not its only, purpose. 31 Director of the Fair Work Building Industry Inspectorate v Bragdon (No 2) [2015] FCA 998; Bragdon v Director of the Fair Work Building Industry Inspectorate (2016) 242 FCR 46; Director, Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (2015) 254 IR 200; Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (The Mitcham Rail Case) [2015] FCA 1173; Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (The Yarra's Edge Case) [2016] FCA 772. 32 Grassby v The Queen (1989) 168 CLR 1 at 16-17; [1989] HCA 45. 33 Pelechowski v Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 at 452 [51]. In The Commonwealth v Director, Fair Work Building Industry Inspectorate34 it was said that what is sought to be achieved by a pecuniary penalty order is to put a price on future contravention that is sufficiently high to deter repetition by the contravener and others who may be tempted to contravene the FWA35. The findings of the primary judge leave no doubt that the only way that deterrence might be achieved is to make the payment by Mr Myles a reality for him and for the CFMEU. The CFMEU and Mr Myles accept that the purpose of a pecuniary penalty order is to effect deterrence. They seek to distinguish between it being a purpose of the legislature's conferral of the power on the Federal Court, but not a power that the Court is to exercise. That is to say, the Court does not possess a power to deter offenders. On this view a power to make a personal payment order does not inhere in the power to make a pecuniary penalty order. It would therefore be necessary that the Parliament expressly confer a power to make an order for personal payment of a penalty. But this argument does not address the question whether such a power may be implied. It may be accepted that s 546(1) would not carry with it an implied power to make an order of a different kind from a pecuniary penalty order, for example a community service order, or otherwise add to the quantum of the maximum penalty which is provided for in the FWA. A personal payment order adds only to the effect which is felt by a contravener: the penalty ordered remains the same. It brings home to that person the reality of a pecuniary penalty which is critical to the attainment of the deterrent effect which is the very point of the penalty. It seeks to accomplish the purpose for which the power is given by s 546(1) within the limits of what is necessary to its effective exercise. The CFMEU and Mr Myles refer to other statutory provisions, such as s 77A of the Competition and Consumer Act 2010 (Cth) and s 199A of the Corporations Act 2001 (Cth), which expressly prohibit bodies corporate from indemnifying persons who are ordered to pay penalties under those statutes. The relevance of these provisions, it is said, is that it is not readily to be inferred that a similar, unexpressed power is given by s 546(1). To the contrary, it is to be expected that any similar kind of order would be expressly provided for. The prohibitions in the statutes mentioned reflect a policy which the legislature has determined should be applied universally. It is not suggested that such a policy is to be found in s 546(1). These statutory provisions do not 34 (2015) 258 CLR 482; [2015] HCA 46. 35 The Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 at 506 [55], quoting Trade Practices Commission v CSR Ltd (1991) ATPR ¶41-076 at 52,152. provide assistance in determining the question of construction with respect to s 546(1), as to whether a power may be implied in order to render a pecuniary penalty order effective. One of the concerns which has been expressed concerning the making of orders of the kind in question is that there may be problems with enforcement36. The concern may be well founded. There may be problems with enforcement of pecuniary penalty orders themselves, given in particular that s 571 provides that imprisonment cannot be a consequence of a failure to pay. A concern about enforcement in a particular case cannot prevent the courts from the proper exercise of their power to make a pecuniary penalty order and it cannot operate as a restriction on the implied power. Concerns about practical difficulties in inferior courts punishing for contempt are largely irrelevant to the question of construction concerning the implied power. It may be that if the prohibition in a personal payment order made by a lower court is flagrantly breached, contempt proceedings would need to be brought in a superior court, because inferior courts lack that jurisdiction. This is not an uncommon occurrence. It does not furnish a proper basis for concluding that the power to make such an order is not necessary. Conclusion and orders The power to make a pecuniary penalty order given by s 546(1) carries with it a power to make the person the subject of such an order pay the penalty personally. to make a non-indemnification order. It is not necessary to further consider s 23 of the FCAA. is not a source of a power Section 545(1) I agree with the orders proposed by Keane, Nettle and Gordon JJ for the reasons given by their Honours. 36 See eg Bragdon v Director of the Fair Work Building Industry Inspectorate (2016) 242 FCR 46 at 62-63 [87]-[88]. The reasoning of Kiefel CJ and of Keane, Nettle and Gordon JJ persuades me that neither s 545(1) of the Fair Work Act 2009 (Cth) nor s 23 of the Federal Court of Australia Act 1976 (Cth) is a source of power to prohibit one person from indemnifying another person who has been ordered to pay a pecuniary penalty under s 546(1) of the Fair Work Act. What follows are my reasons for being equally persuaded that s 546(1) is not a source of power to prohibit that other person from being indemnified. Power to prohibit a person who has been ordered to pay a pecuniary penalty from being indemnified can inhere in s 546(1) only if that power can be "derived by implication" from the sub-section's express conferral of power, on application, to order a person "to pay a pecuniary penalty that the court considers is appropriate if the court is satisfied that the person has contravened a civil remedy provision". The implication is sought to be founded on the principle of construction that an express conferral of power carries with it all that is reasonably necessary to ensure its effective exercise37. Application of that principle to the construction of a statute has traditionally been approached with restraint where the ancillary power sought to be justified is restrictive of liberty and where the express power to which that ancillary power is sought to be appended is not incapable of exercise without it38. The principle is stretched too far, in my opinion, when it is sought to be applied to imply an ancillary power to make an order having the purpose and effect of increasing, beyond that which would exist in the absence of the ancillary order, the punitive impact of the penal order for which the statute conferring the primary power makes express provision. No analogy is to be drawn, in my opinion, between the power conferred by s 546(1) of the Fair Work Act on the Federal Court, in common with the Federal Circuit Court and with every superior and inferior State and Territory court which meets the broad definition in s 12 of the Act of an "eligible State or Territory court", and the power conferred on the Federal Court, which is constituted as a superior court of record, by s 31 of the Federal Court of 37 Pelechowski v Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 at 451-452 [50]; [1999] HCA 19, quoting Grassby v The Queen (1989) 168 CLR 1 at 16-17; [1989] HCA 45. See also R v Forbes; Ex parte Bevan (1972) 127 CLR 1 at 7; [1972] HCA 34. 38 The Trolly, Draymen and Carters Union of Sydney and Suburbs v The Master Carriers Association of NSW (1905) 2 CLR 509 at 523-524; [1905] HCA 20, quoting Fenton v Hampton (1858) 11 Moo PC 347 at 360 [14 ER 727 at 732]. See also Transport Workers' Union of New South Wales v Australian Industrial Relations Commission (2008) 166 FCR 108 at 127-128 [37]-[38]. Australia Act "to punish contempts"39. Unlike the power to punish for contempt, the power to order payment of a pecuniary penalty is not in any meaningful sense "at large"40. At stake when a person who has been ordered to pay a pecuniary penalty seeks or accepts reimbursement from another person is not the dignity of the court which made the order. Nor is any question raised as to abuse or frustration of court processes. True it is that a court imposing a pecuniary penalty is engaged in setting a "price on contravention"41. The price, however, is not the court's price but the legislature's. The price is heavily regulated: it is capped by s 546(2); it is recoverable only under s 546(4) as a debt due to the person referred to in s 546(3) to whom it has been ordered to be paid; and, by force of s 571, no court (including a court of a State or Territory) can order a person who fails to pay to serve a sentence of imprisonment. Having ordered a person to pay the amount of pecuniary penalty which the court considers appropriate within the cap imposed by s 546(2), a court has no obvious mandate to extend or add to the statutory incidents of the order it has made by fashioning a further order prohibiting the person who has been ordered to pay the pecuniary penalty from being indemnified by another person so as to make the price more keenly felt. An implied statutory power that inheres in an express conferral of statutory power might be expected at a minimum to cohere with the statutory scheme of which that conferral forms part. Because that is so, problems of enforcing such an ancillary order consistently with the statutory scheme also tell against implication of the power to make it. In the event of breach, an ancillary order prohibiting a person ordered to pay a pecuniary penalty from being indemnified by another person could be enforced against the person ordered to pay the pecuniary penalty only in a proceeding for contempt of court. Yet not every court empowered to make a pecuniary penalty order under s 546(1) would have power to punish contempt of that nature. Many eligible State or Territory courts, given that they are inferior courts, would not. For those courts which would have power to punish contempt of that nature, imposition of punishment would be problematic. Imposition of a fine would have the effect of requiring compulsory payment by the person of a 39 Cf Australian Building Construction Employees' and Builders Labourers' Federation v Minister of State for Industrial Relations (1982) 43 ALR 189 at 214. 40 Pelechowski v Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 at 484 41 The Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 at 506 [55]; [2015] HCA 46, quoting Trade Practices Commission v CSR Ltd (1991) ATPR ¶41-076 at 52,152. pecuniary amount which would be additional to the amount of the pecuniary penalty already imposed under s 546(1) and capped by s 546(2), and would raise in a State or Territory court further problems of to whom the fine would be required to be paid and of how non-payment of the fine would be enforced. Imprisoning for the contempt would run counter to the spirit if not the letter of Finally, the ambit of what can be characterised by a process of statutory implication as being reasonably necessary to ensure the effective exercise of the power conferred by s 546(1) must be affected by the contextual consideration that the power of the Federal Court and the Federal Circuit Court to make an order under that sub-section is cumulative on the power conferred on each of those courts by s 545(1) to "make any order the court considers appropriate if the court is satisfied that a person has contravened ... a civil remedy provision". If a power to add to "the sting" of a pecuniary penalty order cannot be found in the express and expansive terms of s 545(1), there is good reason to hesitate before discerning such a power to exist by implication in the precise and narrowly focused terms of s 546(1). Adopting as my own the words of Jessup J, with whom Allsop CJ and North J relevantly agreed, in the decision under appeal42: "I appreciate that the perception which occupies the other side of the coin, as it were, is that, absent [some form of non-indemnification] order, the effectiveness of the deterrent intended by the terms of s 546 might be reduced, ultimately to vanishing point. But the legislature must be taken to have set the limits of the deterrent orders which would be available to the court, with such inherent limitations as they had. In my view, it is not within the power of the court, under s 545(1) or otherwise, to devise for itself a more effective deterrent than that for which the statute provides." I would dismiss the appeal. 42 (2016) 247 FCR 339 at 354 [60]. NettleJ KEANE, NETTLE AND GORDON JJ. The question for determination in this appeal was initially whether s 545(1) of the Fair Work Act 2009 (Cth) empowers a judge to order that a union shall not indemnify a union official against a pecuniary penalty imposed on that union official under s 546 of the Fair Work Act. For the reasons which follow, that question should be answered no. the parties were After the hearing, however, to provide submissions on the correct construction of s 546 of the Fair Work Act and, in particular, whether it was open to the appellant, the Australian Building and Construction Commissioner ("the ABCC"), now to contend that there is implied power in s 546 to order that such a union official not seek or accept indemnity or contribution from the union in respect of a pecuniary penalty imposed on the union official. invited The ABCC should be granted leave to amend the notice of appeal to raise that issue. As the respondents accepted, the amendment raises a question of statutory construction which would not have led to different evidence being adduced in the proceedings below had the argument been relied upon earlier. It is true, as the respondents submitted, that the ABCC sought a personal payment order at first instance but subsequently abandoned that submission in favour of a non-indemnification order. But, as will become apparent, the near inseverability of the issues underlying the limits of the power under s 545(1) as argued in this case and whether there is power to order under s 546 that a union official not seek or accept indemnity from the union in respect of a pecuniary penalty imposed on that union official points strongly towards the grant of leave. The fact that the respondents opened up the possibility that there is power within s 546 to make orders that facilitate the performance of an order made under that provision, and that the nature of the power conferred by s 546 was in the end crucial to the parties' oral and written submissions, further emphasises the desirability of considering both grounds together. There is implied power in s 546 to order that a union official not seek or accept indemnity or contribution from the union in respect of a pecuniary penalty imposed on the union official. And, as these reasons will explain, there is no unfairness to the respondents in permitting that issue now to be raised and determined. Whether it is appropriate to make such an order against the second respondent ("Myles") will be a matter for the Full Court of the Federal Court to determine on remitter when the penalty imposition discretion is exercised afresh. Relevant statutory provisions Section 348 of the Fair Work Act provides that a person must not organise or take, or threaten to organise or take, any action against another person with NettleJ intent to coerce the other person or a third person to engage in industrial activity. "Industrial activity" is defined by s 347 as including compliance with a lawful request made by, or requirement of, an industrial association. Section 348 is a "civil remedy provision". Section 546 of the Fair Work Act relevantly provides that: "Pecuniary penalty orders The Federal Court, the Federal Circuit Court or an eligible State or Territory court may, on application, order a person to pay a pecuniary penalty that the court considers is appropriate if the court is satisfied that the person has contravened a civil remedy provision. Determining amount of pecuniary penalty The pecuniary penalty must not be more than: if the person is an individual—the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2); or if the person is a body corporate—5 times the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2). Payment of penalty The court may order that the pecuniary penalty, or a part of the penalty, be paid to: the Commonwealth; or a particular organisation; or a particular person. Recovery of penalty The pecuniary penalty may be recovered as a debt due to the person to whom the penalty is payable. NettleJ No limitation on orders To avoid doubt, a court may make a pecuniary penalty order in addition to one or more orders under section 545." Section 545 of the Fair Work Act relevantly provides that: "Orders that can be made by particular courts Federal Court and Federal Circuit Court The Federal Court or the Federal Circuit Court may make any order the court considers appropriate if the court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision. (2) Without limiting subsection (1), orders the Federal Court or Federal Circuit Court may make include the following: an order granting an injunction, or interim injunction, to prevent, stop or remedy the effects of a contravention; an order awarding compensation for loss that a person has suffered because of the contravention; an order for reinstatement of a person. When orders may be made (4) A court may make an order under this section: on its own initiative, during proceedings before the court; or on application." Section 564 of the Fair Work Act provides that nothing in the Fair Work Act limits the Federal Court's powers under s 21, 22 or 23 of the Federal Court of Australia Act 1976 (Cth). Section 21 of the Federal Court of Australia Act empowers the Federal Court to make binding declarations of right in civil proceedings in relation to NettleJ matters in which it has original jurisdiction. Section 22 confers on the Federal Court power to grant all remedies to which it appears a party is entitled in order that all matters in controversy between the parties may be completely and finally determined. Section 23 empowers the Federal Court, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue or direct the issue of writs of such kinds as the Court thinks appropriate. The facts The events giving rise to these proceedings took place at a construction site for the City to Maribyrnong River Project Package B ("the Package B Project"), which is part of the Victorian Government's Regional Rail Link Project, at Josephs Road in Footscray, Victoria ("the Site"). The Package B Project was being undertaken by an alliance of the Secretary of the Department of Transport, V/Line Pty Ltd, Metro Trains Melbourne Pty Ltd, AECOM Australia Pty Ltd, GHD Pty Ltd, John Holland Pty Ltd ("John Holland"), Abigroup Contractors Pty Ltd ("Abigroup") and Coleman Rail Pty Ltd ("Coleman Rail"). The construction work was being carried out in accordance with a joint venture agreement between John Holland, Abigroup and Coleman Rail. The workforce was made up of labour provided by several major contractors as well as various subcontractors. At the time of the events in issue, there were 71 John Holland employees, 15 Abigroup employees and 12 Coleman Rail employees performing building work on the Package B Project. The terms and conditions of employment of the John Holland and Abigroup employees were governed by a single enterprise agreement made under the Fair Work Act: the Abigroup, John Holland and the Australian Workers' Union Regional Rail Link Southern Cross Station to Footscray Junction Project 2012-2015. In May 2013, Myles was a Vice President of the Construction and General Division of the first respondent ("the CFMEU"). After the commencement of the Package B Project in or around 2012, Myles made frequent visits to the Site wherein he made repeated requests of Dennis Summerfield, an employee of John Holland and the General Superintendent at the Site, to "put a CFMEU delegate on the Site". The requests included words to the effect of: "I need a CFMEU delegate on the Site" and "when am I going to get a delegate?". Summerfield responded to each request in terms to the effect that there was no need for a CFMEU delegate because The Australian Workers' Union ("AWU") was party to the relevant enterprise agreement and there was an AWU delegate on the Site. Myles' requests that there be a CFMEU delegate on the Site were lawful requests made by, or a requirement of, the CFMEU within the terms of s 347(b)(iv) of the Fair Work Act such that action organised or taken with intent NettleJ to coerce compliance with those requests was in contravention of s 348. The joint venture was lawfully entitled to refuse those requests. As part of the Package B Project, John Holland and Abigroup had scheduled for 16 May 2013 the construction of a deflection wall along a section of track on the Site; engaged Boral Resources (Vic) Pty Ltd ("Boral Concrete") to supply 130 cubic metres of wet concrete for the construction of the wall, to be delivered by concrete mixer trucks arriving at approximately ten-minute intervals over a period of three to four hours at the rate of between five and seven cubic metres per truck load; and engaged and scheduled subcontractors ICPS Melb Pty Ltd ("ICPS") and Summit Concrete Pumping Pty Ltd ("Summit") to pump the wet concrete to be delivered by Boral Concrete, and Clifton Formwork (Vic) Pty Ltd ("Clifton Formwork") to construct the formwork and vibrate the concrete being poured. At approximately 7:00am on 16 May 2013, five employees of Clifton Formwork arrived at the Site and began preparation of the deflection wall formwork. Between 8:30am and 9:00am, those employees were joined by four employees of Summit and four employees of ICPS with two concrete boom pumps to pump the concrete to the deflection wall structure. The first Boral Concrete truck arrived at the Site at about 11:20am and commenced to pour concrete. By approximately 11:50am, four Boral Concrete trucks had delivered approximately 24.4 of the 130 cubic metres of concrete that it was intended would be poured that day. At approximately 12:00 noon, Myles and some 20 associates, wearing black hooded jumpers with "CFMEU" emblazoned on the front and back or, in some cases, fluorescent vests bearing the names of various contractors, arrived in about nine separate vehicles at the Josephs Road entrance gate to the Site and parked their vehicles next to each other across the width of the road outside the entrance gate so as to block vehicular access to the Site. They then stood around the vehicles on the road. Summerfield the Abigroup Human Resources/Industrial Relations Manager, and Robert Maroney, the Abigroup Human Resources Advisor, and informed them that Myles and his associates were blockading the concrete pour. Summerfield then approached Myles and asked him what he was doing. Myles replied with words to the effect of: "we've lost our keys and are waiting for the [Royal Automobile Club of Victoria]". Currie and Maroney arrived at the Site shortly after 12:00 noon and observed the blockade. At around 12:20pm Currie called the police, who arrived a short time later. A sergeant of police spoke to Myles, who said that he and his companions would "be there for about an hour". By around that time, four NettleJ additional Boral Concrete trucks with deliveries of wet concrete had been dispatched to the Site and were parked along Josephs Road. Because of the blockade, they were unable to gain access to the Site and to the pumping equipment necessary to unload their concrete. The police, however, did not assist: they made no arrests and took no other action to alleviate the blockade. At around 12:30pm, Summerfield spoke to Myles again. In substance, Myles said: "I haven't got a delegate on site to protect my members so I'm blocking the road". Summerfield responded that there was an AWU delegate and that there was no need for a CFMEU delegate as the Site was "under an AWU Agreement". Myles replied: "I will only remove the blockade if you stop the pour and pack the concrete pumps up". At about 12:45pm, a senior sergeant of police arrived at the Site and, after speaking to Summerfield, approached the blockade and spoke to Myles. Myles told the senior sergeant that he and his companions would not leave the Site until they had disrupted the concrete pour for the day and that the car blockade of the Site would continue until the concrete trucks and concrete pumper had left the area. Yet, once again, despite the apparent criminality of the blockade43, the police took no further action. By about 1:30pm, the wet concrete in the four waiting Boral Concrete trucks (amounting to approximately 24.4 cubic metres) had started to spoil and could no longer be used. Those trucks were sent away from the Site and proceeded to a facility where the concrete could be dumped. By 2:15pm, Summerfield had cancelled the remainder of the concrete deliveries for the day and the pumping crews were instructed to pack up and leave the Site. All other work associated with the pour had to be abandoned. Since the pour could not be completed, the 24.4 cubic metres of concrete that had been poured before the blockade began was entirely wasted and later had to be demolished and disposed At about 2:30pm, after all of the concrete mixer trucks and pumping equipment had left the Site, Myles called out to Summerfield with words to the effect of: "I'll be back tomorrow to stop the concrete pour" and: "You won't pour again until you put a delegate on and Ralph Edwards is happy". Ralph Edwards was the President of the Victoria/Tasmania Branch of the Construction 43 See McFadzean v Construction, Forestry, Mining and Energy Union (2007) 20 VR 250 at 281-283 [119]-[126]; Summary Offences Act 1966 (Vic), ss 4(e), 5, 52(1A); Freckelton and Andrewartha, Indictable Offences in Victoria, 5th ed (2010) at 954 NettleJ and General Division of the CFMEU. Myles and his associates then gathered in a huddle, shook hands, posed for a photograph with a red CFMEU flag and left the Site in their vehicles. On 17 May 2013, Myles returned to the Site and spoke to Summerfield and Maroney. In substance, Myles asked: "Has the project reconsidered having a delegate on site, because if there was a delegate on site, there would be no more issues, guaranteed?" Summerfield responded: "No, we haven't considered a delegate and won't be having one". Myles asked: "Do you want a war or a delegate?", to which Summerfield answered: "Nobody wants a war". Myles replied: "Well if you don't want to put a delegate on then we will have one. I'll be back tomorrow to stop the concrete pour". The proceedings at first instance the ABCC) the statutory predecessor of On 21 May 2014, the Director of the Fair Work Building Industry Inspectorate (being instituted proceedings in the Federal Court against Myles and the CFMEU alleging contraventions of s 348 of the Fair Work Act constituted of the blockade of the Site led by Myles on 16 May 2013 and the threats to organise a further blockade made by Myles on 16 and 17 May 201344. Prior to the hearing, Myles and the CFMEU admitted that Myles had organised and participated in the blockade on 16 May 2013 and made the threats on 16 and 17 May 2013 with the intention of coercing John Holland and Abigroup to comply with the request that there be a CFMEU delegate on the Site. Each of them further admitted that, by that conduct, Myles, and through him the CFMEU, contravened s 348 of the Fair Work Act45. The hearing before the primary judge (Mortimer J) thus proceeded as a plea in relation to penalty. Based on agreed facts, her Honour found that the offending conduct was deliberate and knowingly unlawful46. The CFMEU and its controlling minds were found to be indifferent as to whether the conduct they organised against employers was lawful or unlawful, and Myles was found not to care that his conduct was unlawful as long as it served the industrial purposes he sought to advance. Neither Myles nor the CFMEU showed any remorse. 44 Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [1]-[2]. 45 Director v CFMEU (No 2) [2016] FCA 436 at [7], [9]. 46 Director v CFMEU (No 2) [2016] FCA 436 at [103]-[104], [108]-[109]. NettleJ The primary judge further found47 that Myles and the CFMEU had repeatedly engaged in similar conduct. Between 1999 and 2015, the CFMEU was shown to have committed 106 separate contraventions of industrial laws and, in 2015 alone, there were ten decisions of the Federal Court which involved findings of contraventions by the CFMEU in relation to conduct occurring between 2012 and 2014. The Victoria/Tasmania Branch of the Construction and General Division of the CFMEU had been involved in 23 separate proceedings involving proved contraventions dating back to 2004, and, in 2015, there had been four such proceedings relating to conduct between 2012 and 2014. Additionally, there had been four separate sets of proceedings in which orders had been made against Myles, the first in 2013 and the most recent in 2015. Three of those proceedings related to conduct that occurred in Queensland and the most recent concerned conduct that occurred in Victoria. As her Honour held, the evidence demonstrated a continuing attitude of disobedience to the law manifested by conduct having common features of abuse of industrial power and the use of whatever means were considered likely to achieve outcomes favourable to the CFMEU48. The primary judge further found49 that it was apparent from the CFMEU's financial statements as at 31 December 2014 that the Victoria/Tasmania Branch of the Construction and General Division of the CFMEU had net assets of almost $59 million, including more than $14 million in cash and cash equivalents, and a net operating surplus for the financial year ending 31 December 2014 of almost $3 million. In light of that evidence, her Honour found50 that Myles and the CFMEU had engaged in the contravening conduct in the belief that any penalties that were imposed would be satisfied from funds which the CFMEU received from members and, to an extent of $8 million for the financial year ending 31 December 2014, from "operating grant receipts" paid from public funds. Her Honour considered51 that that compounded their disregard for the law, because Myles and the CFMEU viewed the latter's large asset and income base as providing a "suitable cushion from the tangible effects of any unlawful behaviour". Her Honour concluded52 that there was a conscious and deliberate 47 Director v CFMEU (No 2) [2016] FCA 436 at [108], [118]-[120]. 48 Director v CFMEU (No 2) [2016] FCA 436 at [140]. 49 Director v CFMEU (No 2) [2016] FCA 436 at [111]. 50 Director v CFMEU (No 2) [2016] FCA 436 at [112]-[113]. 51 Director v CFMEU (No 2) [2016] FCA 436 at [113]. 52 Director v CFMEU (No 2) [2016] FCA 436 at [140]. NettleJ strategy on the part of the CFMEU and its officers to engage in disruptive, threatening and abusive behaviour towards employers, without regard to the lawfulness of their actions, in the belief that they were impervious to the effects of prosecution and penalties. As the primary judge stated53, the principal consideration in the imposition of penalties for contravention of civil remedy provisions is deterrence, both specific and general; more particularly, the objective is to put a price on contravention that is sufficiently high to deter repetition by the contravener and by others who might be tempted to contravene54. In this case, given the CFMEU's antecedents, the primary judge considered55 that penalties needed to be fixed with particular reference to providing specific deterrence against further contraventions by the CFMEU. As the primary judge further observed56, however, although considerations of specific deterrence are properly applicable to the CFMEU, in a practical sense they need to be directed to those who hold office in the organisation and make decisions about the industrial action taken or organised by the CFMEU. In the result, the primary judge made declarations of contravention and imposed pecuniary penalties on Myles totalling $18,000 to be paid to the Commonwealth within 90 days, and penalties totalling $60,000 on the CFMEU to be paid to the Commonwealth within 30 days. Finally, the primary judge went on to consider57, and ultimately acceded to, an application by the ABCC for a further order pursuant to s 545(1) of the Fair Work Act that the CFMEU not directly or indirectly howsoever indemnify Myles against the penalties imposed on him ("the non-indemnification order"). Her Honour reasoned58 that the non-indemnification order might cause Myles to 53 Director v CFMEU (No 2) [2016] FCA 436 at [131]-[132]. 54 The Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 at 506 [55] per French CJ, Kiefel, Bell, Nettle and Gordon JJ (Keane J agreeing at 513 [79]); [2015] HCA 46, citing Trade Practices Commission v CSR Ltd (1991) ATPR ¶41-076 at 52,152. 55 Director v CFMEU (No 2) [2016] FCA 436 at [144]. 56 Director v CFMEU (No 2) [2016] FCA 436 at [143]. 57 Director v CFMEU (No 2) [2016] FCA 436 at [164]-[165]. Cf Director of the Fair Work Building Industry Inspectorate v Bragdon (No 2) [2015] FCA 998 at 58 Director v CFMEU (No 2) [2016] FCA 436 at [190]-[191]. NettleJ think more carefully about his actions in the future. Although it would not preclude him from raising funds from sources other than the CFMEU, her Honour observed59 that the need to raise funds from other sources was likely to involve more time and effort and thereby cause Myles to think more carefully again about the consequences of his transgressions. Her Honour further reasoned60 that the non-indemnification order was likely also to deter the CFMEU from committing further contraventions of the Fair Work Act through the agency of Myles, because, as her Honour put it: "if indemnification of officials or other agents of the CFMEU for unlawful industrial action may be prevented by court orders, those responsible for decision making in the union may have cause to think about the penalties to which their own officials may be exposed when they consider engaging in conduct that may be unlawful. Such orders are also capable of having a general deterrent effect on other individuals and unions for the same reason." The proceedings before the Full Court of the Federal Court Myles and the CFMEU appealed to the Full Court of the Federal Court on several grounds, including that the penalty imposed on Myles was manifestly excessive. The Full Court (Allsop CJ, North and Jessup JJ)61 upheld two grounds of appeal: (1) that the primary judge had no power under s 545(1) to make the non-indemnification order (Ground 1); and (2) that the primary judge had denied Myles and the CFMEU procedural fairness by deciding that penalties might or would be paid from funds derived from "the public purse" (Ground 4). Allsop CJ (with whom North J relevantly agreed) reasoned62 that, although the non-indemnification order was relevant to deterrence, the aim of the order was impermissibly to aid the force and effect of the imposed penalty. His Honour held that such an imposition on the freedom of a person or organisation to conduct his, her or its own otherwise lawful dealings with property must find 59 Director v CFMEU (No 2) [2016] FCA 436 at [202]. 60 Director v CFMEU (No 2) [2016] FCA 436 at [191]. 61 Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner (2016) 247 FCR 339. 62 CFMEU v ABCC (2016) 247 FCR 339 at 342 [11] (North J relevantly agreeing at NettleJ its source of power in clear and express statutory language. Allsop CJ added63 that, if it were open under s 545(1) to make a non-indemnification order of the kind made by the primary judge, there would be nothing to prevent other such orders, such as that a bank not lend money to a contravener to assist with the payment of a penalty, or that family or friends not assist a contravener with the payment of a penalty. His Honour considered that intrusions of that kind into the lives of people doing what is otherwise lawful would again require a clear statutory source of authority. Jessup J largely based his reasoning on the legislative antecedents of s 545(1), particularly s 807(1) of the Workplace Relations Act 1996 (Cth) as amended by the Workplace Relations Amendment (Work Choices) Act 2005 (Cth)64. His Honour considered65 that there would have been a "strong argument" in relation to s 807(1)(c) that "as a pure matter of grammatical construction, the power to make any other order" for which it provided could not have been used "to strengthen, to supplement or to improve upon the efficacy of an order of a kind that was, or could have been, made under the specific provisions" of s 807(1)(a) or (b). Jessup J observed66 that, by contrast, the power now afforded by s 545(1) appears as a free-standing power, and that the change to such an apparently free-standing power was part of a wholesale rationalisation of the powers to impose pecuniary penalties in relation to contraventions of civil remedy provisions. But his Honour concluded that, since the change in form had not been the subject of commentary in the parliamentary materials, it was inescapable that the change was one only of drafting and not reflective of a legislative intent to alter the substance of the pre-existing law. Jessup J then turned to the decision of Flick J in Director of the Fair Work Building Industry Inspectorate v Bragdon (No 2)67, to which the primary judge had referred, and disagreed with Flick J's conclusion that s 545(1) supplemented the power to impose a pecuniary penalty given under s 54668. His Honour stated that Flick J's reasoning was question begging. Jessup J concluded that, since the 63 CFMEU v ABCC (2016) 247 FCR 339 at 342-343 [13]. 64 CFMEU v ABCC (2016) 247 FCR 339 at 348-349 [41]-[43]. 65 CFMEU v ABCC (2016) 247 FCR 339 at 349 [44]. 66 CFMEU v ABCC (2016) 247 FCR 339 at 349 [45]. 67 [2015] FCA 998 at [24]. 68 CFMEU v ABCC (2016) 247 FCR 339 at 352-353 [54]-[55], 354 [60]. NettleJ power given expressly by s 546 is limited to requiring a person to pay a stipulated penalty, and since the effect of a non-indemnification order of the kind made by the primary judge would be "to add to the penal outcome authorised by the section", it should be concluded that such an order was beyond the limits of the orders effecting deterrence which the Parliament had determined should be available to the courts. The appellant's contentions At the outset of the ABCC's submissions, counsel emphasised that the question in issue in the appeal was whether s 545(1) empowers a judge to make a non-indemnification order against a party who stands before the judge to be penalised for a proven breach of a civil remedy provision. There was no question as to whether s 545(1) would empower a judge to make such an order against a person who is not a party to the proceeding. Consequently, in counsel's submission, problems of the kind to which Allsop CJ referred, as to whether orders could be made, for example, against a bank prohibiting a loan being extended to a contravener to assist with payment of a pecuniary penalty, or against friends or family in similar terms, plainly did not fall to be decided. Secondly, the ABCC contended that empowering provisions like s 545(1) are not ordinarily to be construed as restricted to defined and closed categories of powers69, and thus it is inappropriate to read a provision like s 545(1) by drawing implications or imposing limitations which are not found in the express terms of the text70. Nor is the conferral of power to be narrowed for fear of "extreme examples and distorting possibilities"71. Rather, courts may and should develop 69 See Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 639 per Gaudron J; [1987] HCA 23; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 423-424 [110] per Kirby J; [1999] HCA 18. 70 See Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 421; [1994] HCA 54; CDJ v VAJ (1998) 197 CLR 172 at 185-186 [53] per Gaudron J; [1998] HCA 67; Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424 at 450 [61] per Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ; [2004] HCA 28; Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304 at 361 [178] per Gummow, Hayne, Heydon and Kiefel JJ; [2009] HCA 25; Weinstock v Beck (2013) 251 CLR 396 at 419-420 [55]-[56] per Hayne, Crennan and Kiefel JJ; [2013] HCA 14. 71 See generally Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 43 [32] per Gleeson CJ, Gummow and Hayne JJ; [2003] HCA 72. NettleJ principles governing the exercise of the relevant power to ensure that it is not exercised in a way that would constitute an abuse72. Thirdly, the ABCC argued, contrary to the Full Court's reasoning, s 546 is plainly not an exhaustive code with respect to pecuniary penalty orders that abstracts from s 545(1) the power to make orders touching upon or concerning a pecuniary penalty. In the ABCC's submission, inasmuch as s 564 of the Fair Work Act provides that nothing in the Act limits the court's powers under s 23 of the Federal Court of Australia Act, s 564 makes plain that s 546 is not an exclusive code as to penalty. Fourthly, the ABCC submitted, contrary to the Full Court's reasoning, the non-indemnification order did not make the pecuniary penalty imposed on Myles any more severe. Rather it ensured that Myles bore the pecuniary penalty which the primary judge intended that he should bear, and it prevented Myles and the CFMEU from reallocating as between themselves the relative burden of responsibility in a manner calculated to frustrate the primary judge's intended allocation. At times, this argument was also located at a higher level of abstraction: it was submitted that, given the longstanding pattern of defiant behaviour by the CFMEU, the non-indemnification order was necessary to protect the standing and authority of the court. Alternatively, it was contended both in reply and in the ABCC's further written submissions, if it were not open to make the non-indemnification order under s 545(1), it was open to do so under s 546. The respondents' contentions Myles and the CFMEU argued that to assume or submit that the power conferred by s 545(1) is wide is to fail to grapple with the extent of its width. And, in that respect, it was submitted, it is telling that the Parliament had not included in the Fair Work Act a provision akin to s 77A of the Competition and Consumer Act 2010 (Cth) or s 199A(2)(b) of the Corporations Act 2001 (Cth), which expressly prohibit persons being indemnified against pecuniary penalty orders. If Parliament had intended to impose any restriction on indemnity against civil penalties, it was submitted, the Fair Work Act would surely have included a provision like those mentioned. It was also contended that the extrinsic 72 See Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 185 per Mason CJ and Deane J, 203 per Dawson J; [1992] HCA 28. See also Patton v Buchanan Borehole Collieries Pty Ltd (1993) 178 CLR 14 at 23 per Gaudron J; [1993] HCA NettleJ materials73 leave no doubt that s 545(1) is directed to that section's remedial purposes, and that an order that B not indemnify A in respect of a pecuniary penalty imposed on A in respect of a contravention cannot logically be conceived of as directed to remedying the contravention by A. More particularly it was submitted that, in the context of s 545(1), "appropriate" should be interpreted, by reference to the case law concerning s 23 of the Federal Court of Australia Act, as meaning necessary to render the exercise of the court's jurisdiction effective. It was contended that, although the power conferred by s 545(1) is a power to make any order the court considers appropriate where a person has contravened a civil remedy provision of the Fair Work Act, the power must be construed as subject to the express limits of s 546. To do otherwise would depart from an orthodox application of the Anthony Hordern principle74. Counsel also invoked the decision of the Court of Appeal for Ontario in R v Bata Industries Ltd75, in which it was held that a condition of a probation order imposed on a company that it not indemnify its directors against the penalty imposed on them was directed to restraining the company expending its funds and thus motivated by an improper purpose. It was submitted that, by analogy, the order that the CFMEU not indemnify Myles against the pecuniary penalty imposed on him should be seen as underlain by an improper purpose of limiting Myles' capacity to raise funds to pay the penalty. Additionally, it was contended that prohibiting the CFMEU from indemnifying Myles against the pecuniary penalty imposed on him was not necessary to ensure that the deterrent effect of the penalty was accomplished. Counsel referred to observations of this Court in Lamb v Cotogno76 that the fact that a defendant may not be personally liable to pay exemplary damages does not necessarily diminish the deterrent effect of the damages. It was submitted that mutatis mutandis the same applies to the pecuniary penalty imposed on Myles. Alternatively, it was contended on the basis of the decision in Hinch v Attorney-General77 that it was not open to take into account in setting the amount 73 See, for example, Australia, House of Representatives, Fair Work Bill 2008, Explanatory Memorandum at 329 [2150]. 74 See Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 7 per Gavan Duffy CJ and Dixon J; [1932] HCA 9. 75 (1995) 25 OR (3d) 321 at 328. 76 (1987) 164 CLR 1 at 9-10; [1987] HCA 47. 77 [1987] VR 721 at 730-731 per Young CJ, 748, 749, 751 per Kaye J. NettleJ of a pecuniary penalty the source from which the penalty would or might likely be paid and, therefore, it was not open to add to a penalty by way of an order which precludes the indemnification of a contravener against the amount imposed. It was submitted, consistently with the reasoning of Allsop CJ in the Full Court, that clear words are required to empower a court to make orders against persons restraining them from doing what is otherwise lawful, and that the principle of legality protects departure from fundamental rights and from "the general system of law" including, relevantly, as it relates to otherwise lawful asset management. Finally, it was contended that the clear words of s 546 precluded orders binding persons other than a contravener – and, therefore, would not support a non-indemnification order – and, likewise, that s 546 would not support an order that a contravener not seek or accept indemnity: for such would not be facilitative or otherwise directed to the effective exercise of power under s 546. The correct construction of s 545(1) (i) Preventative, remedial and compensatory orders As Jessup J observed78 in the Full Court, it assists in the construction of s 545(1) to have regard to its legislative history. But the starting point of the process must be the text of s 545(1) read in the context of the Fair Work Act as a whole and, in particular, in light of s 54679. So approached, the first and most immediate point of significance is the breadth of the terms in which s 545(1) empowers the court to make any order the court considers appropriate. What is "appropriate" for the purpose of s 545(1) falls to be determined in light of the purpose of the section and is not to be artificially limited. As the ABCC submitted, such broad terms of empowerment80 are constrained only by 78 CFMEU v ABCC (2016) 247 FCR 339 at 347-349 [38]-[45]. 79 See Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 31 [4] per French CJ, 46-47 [47] per Hayne, Heydon, Crennan and Kiefel JJ; [2009] HCA 41; Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 388-389 [23]-[24] per French CJ and Hayne J, 411-412 [88] per Kiefel J; [2012] HCA 56. 80 See generally Port Kembla Coal Terminal Ltd v Construction, Forestry, Mining and Energy Union (2016) 248 FCR 18 at 98-99 [279]-[283] per Jessup J. NettleJ limitations that are strictly required by the language and purpose of the section81. To adopt and adapt the language of Flick J in Transport Workers' Union of Australia, NSW Branch v No Fuss Liquid Waste Pty Ltd82, the object and purpose of the power under s 545(1) is quite separate and distinct from that of the power under s 546 to order that a contravener pay a pecuniary penalty. The second point of significance is contextual, and it points the other way. It will be observed that all of the example orders listed in s 545(2) are directed to preventing the occurrence of an apprehended contravention, remedying the effects of a committed contravention or compensating victims of a contravention for the consequences of the contravention. None of the example orders is penal. That suggests that the types of orders that may be regarded as "appropriate" within the meaning of s 545(1) are limited to preventative, remedial or compensatory orders, or at least do not include penal orders. The third point dovetails with the second. As was earlier set out, the chapeau to s 545(2) expressly provides that the sub-section does not limit s 545(1). Standing alone, that could be taken to mean that s 545(2) does not in any way limit the scope of s 545(1). If so, it would permit of the possibility that s 545(1) extends to "appropriate" penal orders, notwithstanding that the example orders in s 545(2) are not penal. But, read in the context of s 545 as a whole, and particularly in light of the absence from s 545 of any explicit or apparently implicit suggestion of a penal purpose, the stipulation that s 545(2) does not limit s 545(1) presents as more likely to mean that the preventative, remedial and compensatory orders instanced in s 545(2) do not limit the range of preventative, remedial and compensatory orders open to be made under s 545(1)83. The fourth point is also contextual and it augments the third. Critically, the only form of penal order to which the Fair Work Act specifically refers is a 81 See Shin Kobe Maru (1994) 181 CLR 404 at 421; CDJ v VAJ (1998) 197 CLR 172 at 185-186 [53] per Gaudron J; Andar Transport (2004) 217 CLR 424 at 450 [61] per Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ; Campbell v Backoffice Investments (2009) 238 CLR 304 at 361 [178] per Gummow, Hayne, Heydon and Kiefel JJ; Weinstock v Beck (2013) 251 CLR 396 at 419-420 [55]-[56] per Hayne, Crennan and Kiefel JJ. See, for example, Knight v FP Special Assets (1992) 174 CLR 178 at 192-193 per Mason CJ and Deane J; Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd (2009) 239 CLR 75 at 91-92 [24] per French CJ, Gummow, Hayne and Crennan JJ, cf at 121 [101] per Heydon J; [2009] HCA 43. 82 [2011] FCA 982 at [41]. 83 See and compare TWU v No Fuss Liquid Waste [2011] FCA 982 at [43]-[44], [47]. NettleJ pecuniary penalty order; and s 546 is the only provision of the Fair Work Act that expressly provides for the imposition of pecuniary penalty orders. That strongly implies that s 546 is the sole repository of the power to make penal orders and, in turn, that provides powerful support for the conclusion that orders appropriately made under s 545(1) are limited to preventative, remedial and compensatory orders. The fifth point draws on the historical context to which Jessup J referred. As his Honour observed84, given the legislative antecedents of s 545(1), it is less than likely that the expression "any order the court considers appropriate" was designed radically to alter the preventative, remedial and compensatory nature of the power for which the legislative antecedents of s 545(1) had long provided by introducing a power to make penal orders85. And as Jessup J also observed86, it is significant that there is no mention in the extrinsic materials of any such intention. Seen, therefore, against the background of the provision's legislative history, it presents as more probable that the purpose of conferring a free-standing power to make any order considered to be "appropriate" was to delimit the scope of preventative, remedial and compensatory orders open to be made under that provision. That observation also provides support for the conclusion that s 546 is the sole repository of the power to make penal orders. The sixth point concerns the stipulation in s 546(5) that, to avoid doubt, a court may make a pecuniary penalty order in addition to one or more orders made under s 545. Ex facie that stipulation is equivocal. But, contrary to the ABCC's submissions, on closer examination it does not suggest that s 545(1) enables the making of penal orders. As authority shows87, the purpose and effect of s 546(5) is to make clear that a court may impose a pecuniary penalty under s 546 notwithstanding that it may also have made, or proposes to make, preventative, remedial and compensatory orders under s 545. 84 CFMEU v ABCC (2016) 247 FCR 339 at 349 [44]-[45]. 85 Cf Independent Education Union of Australia v Australian International Academy of Education Inc [2012] FCA 1512 at [15]. 86 CFMEU v ABCC (2016) 247 FCR 339 at 349 [45]. 87 See Sayed v Construction, Forestry, Mining and Energy Union (2016) 239 FCR 336 at 346 [58], 354 [105]. See, for example, Australian Licensed Aircraft Engineers Association v International Aviation Service Assistance Pty Ltd (No 2) (2011) 205 IR 465 at 470 [21]-[22]; Mayberry v Kijani Investments Pty Ltd (2011) 215 IR 404 at 408 [20]. NettleJ The final consideration is s 564 of the Fair Work Act. Section 23 of the Federal Court of Australia Act empowers the Federal Court to make such orders as it considers "appropriate" to be made in the exercise of its jurisdiction and powers, as an incident of the general grant to it as a superior court of law and equity of the jurisdiction to deal with such matters88. The power conferred by s 23 extends to making orders necessary to ensure the effective exercise of the determination of a matter89 and orders reasonably required or legally ancillary to ensuring that the court's order is effective according to its tenor. But the power conferred by s 23 does not extend to making penal orders. Consequently, the fact that s 564 provides that nothing in the Fair Work Act limits the orders that may be made under s 23 of the Federal Court of Australia Act does not suggest that the power conferred by s 545(1) extends to making penal orders. Rather, s 564 serves to make clear that the range of preventative, remedial and compensatory orders which may be made under s 545 does not, by implication, restrict the range of non-penal orders open to be made under s 23. In the result, despite the breadth of the power conferred by s 545(1), it should be concluded that it is limited to making appropriate preventative, remedial and compensatory orders and as such does not include a power to make penal orders. (ii) Nature of a non-indemnification order The question then is whether a non-indemnification order of the kind in issue is a preventative, remedial or compensatory order within the ambit of s 545(1) or whether it is to be conceived of as penal and thus beyond the ambit of the power conferred by that provision. As the ABCC submitted, the non-indemnification order did not increase the penalty imposed on Myles. It was and remains a penalty of $18,000. Nor did it increase the penalty imposed on the CFMEU, which was and remains a penalty of $60,000. And, although the non-indemnification order was calculated to deter Myles and, through him, the CFMEU from committing further contraventions of the civil remedy provisions of the Fair Work Act90, the fact that an order is 88 Jackson v Sterling Industries (1987) 162 CLR 612 at 622-624 per Deane J. 89 Jackson v Sterling Industries (1987) 162 CLR 612 at 623, 625 per Deane J; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 32-33 [35] per Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 30. 90 Director v CFMEU (No 2) [2016] FCA 436 at [190]-[191]. NettleJ designed to deter future contraventions does not necessarily make it a penal order. For example, an order that an employer submit its employment records to regular auditing might be calculated to deter the employer from committing contraventions of civil remedy provisions prohibiting the underpayment of employee entitlements91. But it could not be regarded as a penal order. Likewise, the fact that an order "touches upon" a pecuniary penalty does not necessarily mean that it is a penal order. For example, an asset preservation order may be designed to ensure that funds are available to meet a pecuniary penalty order but it could not itself be regarded as a penal order. By contrast, however, a non-indemnification order of the kind in issue not only is directly connected to the pecuniary penalty order in respect of which it is made, but also serves to maintain the sting or burden of the pecuniary penalty order by prohibiting a pass-through of liability. In those respects, it is as much a penal order as an order that a pecuniary penalty be paid on terms, or that a pecuniary penalty be suspended pending compliance with an undertaking to desist from further contravention, or that a pecuniary penalty be payable only in the event of a failure to comply with an undertaking, or that a pecuniary penalty shall become payable only upon the happening of an identified event. There are a number of cases in the Federal Court and the Federal Circuit Court (and in the latter's predecessor) in which orders as to the terms and conditions on which pecuniary penalties are payable, or which had the effect of suspending the operation of pecuniary penalty orders, were purportedly made under s 545(1)92. As will be explained, those orders are better conceived of as sustained by power implicit in s 546 to do what is reasonably required for, or legally ancillary to, the accomplishment of the specific remedy of pecuniary penalties for which s 546 provides93. Since s 545 is confined to preventative, remedial and compensatory orders, it does not support the making of a non- indemnification order in respect of a pecuniary penalty because such an order is properly understood as a penal order. Likewise, despite the breadth of s 23 of the Federal Court of Australia Act, given that s 23 does not extend to making penal 91 See, for example, Fair Work Act, ss 44, 293, 305, 323, 325, 328. 92 See, for example, United Group Resources Pty Ltd v Calabro (No 7) (2012) 203 FCR 247 at 262-263 [18]-[19]; Construction, Forestry, Mining and Energy Union v CSR Ltd [2012] FMCA 983 at [1]; Director of the Fair Work Building Industry Inspectorate v Ellen [2016] FCA 1395 at [41]. 93 See, for example, Fair Work Ombudsman v W.K.O. Pty Ltd [2012] FCA 1129 at [110]. See generally Pelechowski v Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 at 452 [51] per Gaudron, Gummow and Callinan JJ; [1999] HCA 19. NettleJ orders, it will not support the making of a non-indemnification order in respect of a pecuniary penalty. Implied power under s 546 (i) The extent of the power Section 546 expressly confers power on the court to make an order that a person pay a pecuniary penalty. From that express conferral of power arises an implied power to make such other orders as are necessary for or facilitative of the type of orders expressly provided for94. For the reasons that follow, that implied power under s 546 includes power to make an order that a contravener pay a pecuniary penalty personally and not seek or accept indemnity from a co-contravener, otherwise known as a "personal payment order". As has been observed, the principal object of an order that a person pay a pecuniary penalty under s 546 is deterrence: specific deterrence of the contravener and, by his or her example, general deterrence of other would-be contraveners95. According to orthodox sentencing conceptions96 as they apply to the imposition of civil pecuniary penalties97, specific deterrence inheres in the sting or burden which the penalty imposes on the contravener. Other things being equal, it is assumed that the greater the sting or burden of the penalty, the more likely it will be that the contravener will seek to avoid the risk of subjection to further penalties and thus the more likely it will be that the contravener is deterred from further contraventions; likewise, the more potent will be the example that the penalty sets for other would-be contraveners and therefore the greater the penalty's general deterrent effect. Conversely, the less the sting or 94 See Grassby v The Queen (1989) 168 CLR 1 at 16-17 per Dawson J (Mason CJ, Brennan J and Toohey J agreeing at 4, 21, Deane J relevantly agreeing at 5); [1989] HCA 45; Pelechowski (1999) 198 CLR 435 at 451-452 [50]-[51] per Gaudron, 95 Commonwealth v Director (2015) 258 CLR 482 at 506 [55] per French CJ, Kiefel, Bell, Nettle and Gordon JJ (Keane J agreeing at 513 [79]). 96 See generally R v Williscroft [1975] VR 292 at 298-299 per Adam and Crockett JJ; Ryan v The Queen (2001) 206 CLR 267 at 281-282 [43] per McHugh J; [2001] HCA 21; Freiberg, Fox & Freiberg's Sentencing: State and Federal Law in Victoria, 3rd ed (2014) at 250-257 [3.100]. 97 See generally Commonwealth v Director (2015) 258 CLR 482 at 505-506 [52]-[55] per French CJ, Kiefel, Bell, Nettle and Gordon JJ (Keane J agreeing at 513 [79]). NettleJ burden that a penalty imposes on a contravener, the less likely it will be that the contravener is deterred from further contraventions and the less the general deterrent effect of the penalty. Ultimately, if a penalty is devoid of sting or burden, it may not have much, if any, specific or general deterrent effect, and so it will be unlikely, or at least less likely, to achieve the specific and general deterrent effects that are the raison d'être of its imposition. The idea that Lamb v Cotogno implies the contrary is misplaced. To acknowledge that a deterrent effect of exemplary damages exists despite the fact that a defendant may be insured against them is to recognise that the quantum of exemplary damages, as opposed to the fact of their personal payment, provides a measure of the court's disapproval of the defendant's conduct. That is one object of an award of exemplary damages98. But it is facile to suppose that the context of exemplary damages says much, if anything at all, as to the specific and general deterrent effects of pecuniary penalty orders, which, it is accepted, are closely related to the sting or burden that such orders impose on the contravener. Certainly, the power expressly conferred by s 546 is limited to making an order that a person "pay a pecuniary penalty". But, as has been observed, the express grant of power carries with it implied power to do everything necessary for the effective exercise of the power to impose a pecuniary penalty; and thus implied power to make such further orders as are reasonably required for, or legally ancillary to, the accomplishment of the deterrent effect that the penalty is calculated to achieve99. Thus, for example, as counsel for Myles and the CFMEU rightly conceded, where a contravener is subjected to a pecuniary penalty, s 546 imports an implied power to accomplish the effect which the penalty is calculated to achieve by ordering, say, that the penalty be paid on terms; or paid conditionally upon a specified occurrence; or paid in default of compliance with an identified requirement. Parity of reasoning dictates that s 546 also imports implied power to achieve the effect which a pecuniary penalty is calculated to achieve by ordering 98 See Lamb v Cotogno (1987) 164 CLR 1 at 7-10; Gray v Motor Accident Commission (1998) 196 CLR 1 at 7-8 [14]-[16], 9 [22], 12-13 [32]-[34] per Gleeson CJ, McHugh, Gummow and Hayne JJ, 29 [87], 35 [101] per Kirby J; [1998] HCA 70; New South Wales v Ibbett (2006) 229 CLR 638 at 648-649 [35], [38]-[39]; [2006] HCA 57. 99 See Grassby (1989) 168 CLR 1 at 16-17 per Dawson J (Mason CJ, Brennan J and Toohey J agreeing at 4, 21, Deane J relevantly agreeing at 5); Pelechowski (1999) 198 CLR 435 at 451-452 [50]-[51] per Gaudron, Gummow and Callinan JJ. NettleJ that a contravener pay the penalty personally; or where, as here, joint contraveners are ordered to pay pecuniary penalties in respect of certain contraventions – each according to his, her or its relative share of responsibility for the contravention – implied power to achieve the relative degrees of sting or burden determined by the judge by ordering that neither contravener seek or accept indemnity or contribution from the other. The implied power to make a personal payment order is closely analogous to the court's power to order a contemnor to pay a fine personally100, and an order that joint contraveners not indemnify each other in respect of the penalties imposed on each of them is essentially similar. Given that s 546 expressly empowers the court to order a specific person to pay a pecuniary penalty, it is no stretch to accept that there is power in s 546 to make orders designed to ensure that the person against whom the order is made cannot avoid the incidence of the penalty. It is to take too narrow a view of the purpose of s 546 to regard the provision as being concerned with no more than that an amount of money be paid by someone in discharge of a debt created by order of the court. Section 546 is not about the creation and collection of debts; it is about penalising a contravention of the law. It is to take too narrow a view of the extent of the power conferred by s 546 to deny that it extends to the making of orders designed to ensure that a particular person cannot defeat the purpose of an order that the person pay the penalty imposed on him or her. Myles and the CFMEU contended that it could not be reasoned by analogy with the court's power to punish for contempt that the court has implied power under s 546 to make a personal payment order prohibiting a contravener from seeking or accepting indemnity in respect of a pecuniary penalty. Counsel for Myles and the CFMEU invoked an observation of Jessup J in the Full Court101, in relation to s 545(1), that the power to punish for contempt is different because in the case of contempt the court is: "exercising its jurisdiction, as a superior court of record, to punish for contempt, and to do so effectively. It [is] not concerned with the extent of the power given by a specific statutory provision, as we are here". That argument should be rejected. In Australian Building Construction Employees' and Builders Labourers' Federation v Minister of State for Industrial 100 See and compare Australian Building Construction Employees' and Builders Labourers' Federation v Minister of State for Industrial Relations (1982) 43 ALR 189 at 214 per Evatt and Deane JJ. 101 CFMEU v ABCC (2016) 247 FCR 339 at 355 [65]. NettleJ Relations102, the power to punish for contempt was the statutory power accorded to the Federal Court by s 31 of the Federal Court of Australia Act: a power analogous to that possessed by the High Court to make an order that is just103. The trial judge in that case (Keely J) determined that the punishment that was just in relation to the Federation was a fine of $15,000. To make the punishment effective, his Honour further ordered that the Federation pay the fine personally or by an agent properly authorised in writing. On appeal to the Full Court, Evatt and Deane JJ saw no reason to interfere with the further order and observed that it could well serve as a model in the future104. The considerations that apply in this case, although different, are logically comparable. The power to impose a pecuniary penalty under s 546 is a statutory power to impose such penalty as is considered to be just. The penalty that the primary judge considered to be just in Myles' case was a pecuniary penalty of $18,000. As has been explained, s 546 imports an implied power to make such further orders as are reasonably required for, or legally ancillary to, the accomplishment of the effect that the pecuniary penalty is calculated to achieve. In this case, the primary judge considered that, in order to accomplish the deterrent effect which the penalty of $18,000 was calculated to achieve, it was necessary to order that Myles not be indemnified by the CFMEU in respect of that penalty. Accordingly, although it was not the course her Honour took, it would have been open to the primary judge in exercise of the power conferred by s 546 to make a personal payment order prohibiting Myles from seeking or receiving indemnity from the CFMEU. Myles and the CFMEU argued to the contrary that s 546 does not authorise the making of such an order because, in the language of Jessup J in the Full Court in the context of the power under s 545(1), such an order "add[s] to the penal outcome authorised by the section"105. That argument takes the matter no further. The "penal outcome authorised" by s 546 is that a contravener pay a pecuniary penalty. An order that a contravener must not seek or receive indemnity from his or her co-contravener in respect of a pecuniary penalty adds nothing to that penal outcome. To the contrary, it assists in accomplishing the calculated level of sting or burden of the pecuniary penalty and thereby assists in achieving the penal outcome authorised by the section. For the same reason, 102 (1982) 43 ALR 189. 103 See Judiciary Act 1903 (Cth), s 24; Australian Competition and Consumer Commission v Chaste Corporation Pty Ltd (No 7) (2015) 235 FCR 563 at 566 [8]. 104 Australian Building Construction Employees' and Builders Labourers' Federation v Minister of State for Industrial Relations (1982) 43 ALR 189 at 214. 105 CFMEU v ABCC (2016) 247 FCR 339 at 354 [60]. NettleJ Myles and the CFMEU gain little support from the decision in Hinch. At base, Hinch was a decision that, regardless of whether the appellant was liable to be indemnified in respect of the fine imposed on him for contempt, the sentencing judge should not have imposed a greater fine than the nature and gravity of the contempt dictated. Arguably, it may follow that a judge imposing a pecuniary penalty order would be precluded from imposing a penalty greater than the nature and gravity of the contravention dictated in light of the personal circumstances of the contravener for the reason that the contravener may or would likely be indemnified against the penalty. But whether or not that is the case, the decision in Hinch in no way denies the efficacy of a personal payment order pursuant to s 546 of the Fair Work Act prohibiting a contravener on whom a pecuniary penalty of appropriate quantum is imposed from seeking or accepting indemnity from another party. So to order does not increase the penalty; it assists in its accomplishment. It may also be said that an order to ensure that Myles not seek or receive indemnity from the CFMEU does not render the pecuniary penalty order less efficacious by reason of it making it less likely that Myles would pay the penalty than if he were free to seek the assistance of the CFMEU. There was no suggestion that Myles would be unable to pay his penalty if he were denied the assistance of the CFMEU. Myles and the CFMEU submitted that so to reason is to confuse the power to make a pecuniary penalty order with the purpose of the order, and that there is no implied power in s 546 or elsewhere in the Fair Work Act to make orders for achieving the purpose of a pecuniary penalty order as opposed to making orders for the attainment of the pecuniary penalty order per se. As will be observed, however, that contention is opposed to the concession that counsel for Myles and the CFMEU rightly made that s 546 imports implied power to accomplish the payment of the pecuniary penalty fixed by the court by ordering that the penalty be paid on terms, or conditionally upon a specified occurrence, or in default of compliance with an identified requirement. And to repeat, there is no difference in principle between that kind of process and one of accomplishing the calculated level of sting or burden of a pecuniary penalty order by making a further order that the contravener pay the pecuniary penalty personally or not seek or accept indemnity or contribution from a co-contravener. Admittedly, the former has the effect of ameliorating the prima facie measure of sting or burden and the latter assists in the prevention of its amelioration. But the latter no more inflates the level of sting or burden beyond the level authorised by the statute than the former diminishes it. In each case, the exercise is one of accomplishing the level of sting or burden which the court determines is necessary to be imposed, and thus in each case the exercise is one of doing what is necessary to accomplish the specific remedy of a pecuniary penalty order calculated to achieve the appropriate degree of specific and general deterrence. NettleJ Contrary also to the submissions of Myles and the CFMEU, there is nothing in the decision of the Ontario Court of Appeal in Bata Industries which suggests the contrary. The problem with the probation order in that case was that the order was required to be structured according to what was necessary for the punishment, deterrence and rehabilitation of the company. In fact, the order was formulated according to what the sentencing judge considered to be necessary for the punishment, deterrence and rehabilitation of the directors of the company whom the company was ordered not to indemnify106. It followed, as was held by the Court of Appeal, that the order was motivated by an improper purpose. By contrast, there is no suggestion of improper purpose in this case. Ex hypothesi, the purpose of an order that Myles not seek or recover indemnity from the CFMEU in respect of the pecuniary penalty imposed on him would be to ensure that the level of sting or burden that the primary judge determined should fall on Myles would in truth fall on Myles rather than being reallocated by way of pass-through to the CFMEU. Myles and the CFMEU contended that, given that s 77A of the Competition and Consumer Act and s 199A of the Corporations Act expressly prohibit companies and bodies corporate from indemnifying persons against specified penalties imposed under those Acts107, it is not to be supposed that something similar was capable of being achieved by means of discretionary order simply by the word "appropriate" in s 545(1) or, extending this reasoning to s 546, by the power implicit in s 546 to do what is necessary for the effective exercise of accomplishing the specific remedy of a pecuniary penalty order. More particularly, it was submitted that, although the Competition and Consumer Act, the Corporations Act and the Fair Work Act may not all be in pari materia108, the penalty regime under each is relevantly similar and hence, since the Parliament determined that it was necessary to provide expressly in the Competition and Consumer Act and the Corporations Act for the prohibition of indemnity against penalties, it should be concluded a similar express prohibition in the Fair Work Act would be necessary to achieve the same result. 106 Bata Industries (1995) 25 OR (3d) 321 at 328-329. 107 See also Native Title Act 1993 (Cth), s 203EB; Australian Securities and Investments Commission Act 2001 (Cth), s 12GBD. 108 See generally Lennon v Gibson & Howes Ltd (1919) 26 CLR 285 at 287; [1919] AC 709 at 711-712; Federal Commissioner of Taxation v ICI Australia Ltd (1972) 127 CLR 529 at 541-542; [1972] HCA 75; Pearce and Geddes, Statutory Interpretation in Australia, 8th ed (2014) at 128-129 [3.36]. NettleJ That argument must also be rejected. Express prohibitions of the kind comprised in s 77A of the Competition and Consumer Act and s 199A of the Corporations Act are grounded in policy considerations applicable in all cases falling within the ambit of those sections regardless of the circumstances. Such provisions thus apply whether or not it is considered that it is otherwise necessary or desirable that indemnity be prohibited. For that reason, as Jessup J observed109 in the Full Court, provisions like s 77A of the Competition and Consumer Act and s 199A of the Corporations Act contribute nothing to the task of construing the power to make appropriate orders under s 545(1), which are dependent upon the particular circumstances of each case. A fortiori, they contribute nothing to the task of determining the scope of the power implicit in s 546 to accomplish the specific remedy imposed by a pecuniary penalty order according to the circumstances of each case. It should be concluded that there would have been power under s 546 for the primary judge to make a personal payment order on terms that Myles not seek or accept indemnity from the CFMEU in respect of the pecuniary penalty imposed on Myles. (ii) Section 23 of the Federal Court of Australia Act As has been observed, because s 23 of the Federal Court of Australia Act does not extend to making penal orders, it will not support the making of a non-indemnification order. Whether s 23 would support the making of a personal payment order was not the subject of detailed submissions, and, for the present, need not be decided. It is enough for the disposition of this appeal that s 546 is sufficient in itself to sustain a personal payment order. Whether s 23 would go as far or any farther is better left to be considered when and if the issue arises. (iii) Problems of enforcement It is necessary then to say something more about cases in the Federal Court and the Federal Circuit Court in which it has been ordered, or where a party has applied for an order, purportedly under s 545(1)110, that a contravener 109 CFMEU v ABCC (2016) 247 FCR 339 at 353 [57]. 110 See Bragdon (No 2) [2015] FCA 998; Bragdon v Director of the Fair Work Building Industry Inspectorate (2016) 242 FCR 46. See also Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 1173 at [35]-[39]; Director v CFMEU (No 2) [2016] FCA 436 NettleJ pay a pecuniary penalty personally and not seek indemnity or contribution from other contraveners. Such orders are customarily referred to as Bragdon orders after the name of the first case in which they appear to have been made111. As has now been explained, s 545(1) is confined to preventative, remedial and compensatory orders and it does not support the making of Bragdon orders. The power to make Bragdon orders resides in s 546. More pertinently for present purposes, however, such orders have sometimes been criticised as creating special problems of enforcement, including by exposing vexed questions of identifying the source of funds used for payment112. These are legitimate concerns. There is no point in a court making orders that cannot be enforced113, and, if orders do go unenforced, the lack of enforcement is likely to detract from the prestige of the court and, ultimately, the efficacy of its processes114. Even so, it should not be thought that difficulties of enforcement are necessarily determinative. Ordinarily, it is to be assumed that a contravener who is ordered not to seek or accept indemnity or contribution from a co-contravener in relation to a pecuniary penalty will abide by the order rather than risk detection and punishment for contempt. It is also to be remembered that union officials who aid, abet, counsel or procure one of their number to contravene such an order may themselves be found guilty of contempt115. And, as will be explained, this process may be facilitated by use of a penal notice. Consequently, it is not a precondition of the making of Bragdon orders that the court be positively satisfied of their practical enforceability116. Furthermore, in a case of this kind, in which the ABCC is the industry regulator with the statutory function of enforcing the Fair Work Act and orders made under it, the court may proceed with a degree 111 Bragdon (No 2) [2015] FCA 998. 112 Director v CFMEU [2015] FCA 1173 at [37]-[38]; Bragdon (2016) 242 FCR 46 at 113 See generally J C Williamson Ltd v Lukey and Mulholland (1931) 45 CLR 282 at 298 per Dixon J (Gavan Duffy CJ agreeing at 290); [1931] HCA 15; Patrick Stevedores v MUA (1998) 195 CLR 1 at 46 [78] per Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ. 114 See Bank of Western Australia v Ocean Trawlers Pty Ltd (1995) 13 WAR 407 at 436; Pelechowski (1999) 198 CLR 435 at 485 [149] per Kirby J. 115 See generally CCOM Pty Ltd v Jiejing Pty Ltd (1992) 36 FCR 524 at 530-531; Chan v Chen (No 2) [2007] VSC 24 at [38]-[39]. 116 See and compare Patrick Stevedores v MUA (1998) 195 CLR 1 at 46-47 [78]-[79] per Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ. NettleJ of confidence that the ABCC will be jealous to protect the efficacy of any such orders and therefore astute to detect and institute contempt proceedings for their contravention117. It is also to be remembered that discovery is available against an incorporated trade union in contempt proceedings118. At all events, where, as here, a union official who has contravened the Fair Work Act is closely and conspicuously linked to the union from whom he or she might be ordered not to seek or accept indemnity or contribution, and the union is a co-contravener well-known to the court for its contumacious disregard of court orders, the task of determining the source of funds actually used to pay pecuniary penalties is unlikely to prove overly burdensome and certainly not insurmountable. (iv) Penal notice Rule 41.06 of the Federal Court Rules 2011 (Cth) relevantly provides that, where an order requires a person not to do an act or thing, and the consequences of failing to comply with that order may be committal, sequestration or punishment for contempt, the order must carry an endorsement that the person to be served with the order will be liable to imprisonment, sequestration of property or punishment for contempt if the person disobeys the order (a "penal notice"). If a personal payment order were made against Myles, it would require him not to seek or accept indemnity from the CFMEU in respect of the pecuniary penalty imposed on him. Such an order would be required to carry a penal notice, which, pursuant to r 41.07 of the Federal Court Rules, would have to be served on Myles, and which the judge could also order be served on the CFMEU as the entity from whom Myles would be prohibited from seeking or receiving indemnity. Service of the penal notice on the CFMEU would be sufficient to put the CFMEU on notice not only that the personal payment order had been made but also that the CFMEU was prohibited from knowingly interfering with its performance. 117 See Commonwealth v Director (2015) 258 CLR 482 at 508 [60] per French CJ, Kiefel, Bell, Nettle and Gordon JJ (Keane J agreeing at 513 [79]). See and compare Public Guardian (Qld) v Beasley (No 2) (2015) 302 FLR 103 at 105 [11], 114 [63], 116 [78] per May J, 119 [100] per Austin J (Strickland J generally agreeing with May J and Austin J at 118 [93]). 118 Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 256 CLR 375 at 390 [47] per French CJ, Kiefel, Bell, Gageler and Keane JJ, 398-399 [75] per Nettle J; [2015] HCA 21. NettleJ A non-indemnification order under s 546 Finally, it remains to explain why, notwithstanding that it would have been open to make a personal payment order under s 546 on terms that Myles not seek or accept indemnity from the CFMEU, it was not open under s 546 to order that the CFMEU not indemnify Myles. The reason is that an order of the former kind would be made against the party subjected to the pecuniary penalty and thus would fall naturally within the ambit of the implied power – incidental to the express power to impose the pecuniary penalty – to do what is reasonably required for, or legally ancillary to, the accomplishment of the specific remedy of the pecuniary penalty. By contrast, an order of the latter kind would be made against a party other than the party subjected to the pecuniary penalty and thus could not properly be regarded as an exercise of an incident of the power to impose a pecuniary penalty on the contravener. More particularly, under s 546, the only person on whom the court may impose a pecuniary penalty for a contravention of the Fair Work Act is the contravener. Likewise, the power implicit in s 546 to do what is necessary to accomplish the specific remedy of a pecuniary penalty order is a power to make orders against the contravener. The Fair Work Act does not expressly or otherwise authorise the imposition of a pecuniary penalty on anyone other than the relevant contravener. For the same reason, the Fair Work Act cannot be taken impliedly to authorise the making of an order against a person other than the contravener for the purpose of accomplishing a pecuniary penalty imposed on the contravener. As Allsop CJ remarked119 in the Full Court in relation to whether there is a power to make a non-indemnification order under s 545(1), a non-indemnification order constitutes an imposition on the freedom of a person or organisation to conduct his, her or its own affairs and is intimately bound up with a pecuniary penalty which the person could not lawfully be ordered to pay. Hence, as his Honour concluded, such a power would need to find its source in clear and express words of the statute or, it should be added, would need to appear necessarily to be implicit in an express grant of power. There is no such power, express or implied, in s 546 or otherwise within the Fair Work Act. Disposition of the appeal For the reasons which have been given, the Full Court was correct, in effect, in holding that the primary judge had no power to make the non-indemnification order. It is not in issue that the Full Court was also correct in holding that the primary judge denied Myles and the CFMEU procedural fairness in relation to the question of whether the penalty was to be paid partially 119 CFMEU v ABCC (2016) 247 FCR 339 at 342 [11]. NettleJ out of public funds. But, in these circumstances, it was not correct for the Full Court to order, as their Honours did, merely that the non-indemnification order be set aside, with the remainder of the primary judge's orders left extant. The amount of the pecuniary penalty and the non-indemnification order were distinct but interlinked elements of the one single penalty120, and, as such, they were so much integrated that the primary judge's error in relation to one was necessarily productive of error in the other. The penalty imposition discretion thus miscarried121 and, accordingly, the matter must now be remitted to the Full Court for the penalty imposition discretion to be exercised afresh. To that end, it will be necessary to keep in mind before the Full Court that, because it would have been open to the primary judge as part of the imposition of penalty under s 546 to make a personal payment order against Myles on terms that Myles not seek or accept indemnity from the CFMEU in respect of the pecuniary penalty imposed on Myles, it is similarly open to the Full Court to make such an order as part of the re-imposition of penalty. Of course, whether it is considered appropriate to make such an order will be a matter for the Full Court to determine in the exercise of their Honours' discretion. It will be necessary, too, for the Full Court to hear and consider what Myles and the CFMEU wish to submit in relation to the question of payment of penalties out of public funds. Orders The ABCC should be granted leave to amend the notice of appeal in the manner set out in the proposed amended notice of appeal exhibited to the affidavit of Brendan Charles dated 10 November 2017. Myles and the CFMEU submitted that, if such leave were granted, leave should be conditional on the ABCC paying Myles' and the CFMEU's costs in responding to the application. Given that the ABCC agreed not to oppose such a costs order, and that the issue of a personal payment order was ventilated and ostensibly concluded at first instance, the ABCC should pay Myles' and the CFMEU's costs of, and incidental to, the application to amend the notice of appeal in accordance with s 570(2)(b) of the Fair Work Act. There will otherwise be no order as to costs. Special leave to appeal was granted on the condition that the ABCC not seek an order for costs of the appeal. 120 See and compare Crump v New South Wales (2012) 247 CLR 1 at 16-17 [28] per French CJ; [2012] HCA 20. 121 See and compare Bugmy v The Queen (1990) 169 CLR 525 at 536-537, 539 per Dawson, Toohey and Gaudron JJ; [1990] HCA 18. NettleJ In the result, it should be ordered that the appeal to this Court be allowed. Order 2 of the orders made by the Full Court, which set aside the non-indemnification order, should be set aside. In lieu of Order 2, it should be ordered that Orders 7 to 13 of the orders made by the primary judge be set aside. The matter should be remitted to the Full Court for the re-imposition of penalties according to law.
HIGH COURT OF AUSTRALIA AND APPELLANT THE STATE OF WESTERN AUSTRALIA RESPONDENT AK v The State of Western Australia [2008] HCA 8 26 March 2008 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Western Australia made on 17 November 2006 and in its place order that: the appeal to that Court be allowed, the appellant's convictions be quashed, and there be a new trial. On appeal from the Supreme Court of Western Australia Representation R W Richardson for the appellant (instructed by Aboriginal Legal Service of Western Australia (Inc)) B Fiannaca SC with D A Lima for the respondent (instructed by Director of Public Prosecutions for Western Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS AK v The State of Western Australia Criminal law – Appeals – Application of the proviso – Statutory requirement that reasons for judgment include the principles of law applied and the findings of fact relied upon – Failure to give reasons meeting statutory requirements in respect of central issue at trial – Failure to comply with statutory requirements an error of law – Appeal against conviction to be allowed unless Court of Appeal satisfied that no substantial miscarriage of justice had occurred – Whether no substantial miscarriage of justice had occurred. Criminal law – Evidence – Identification – Complainant indecently dealt with by one of two males with whom she and her sister were sharing a bed – Complainant unable to identify the perpetrator by visual or aural means – Complainant adamant that the appellant was responsible – Whether identification warning needed – Whether finding of guilt unreasonable or not supported by evidence. Criminal Appeals Act 2004 (WA), s 30. Criminal Procedure Act 2004 (WA), ss 119, 120. GLEESON CJ AND KIEFEL J. This is an appeal from the Court of Appeal of Western Australia, which heard a criminal appeal from a judge sitting without a jury. It is common ground that the primary judge erred in law by failing to give adequate reasons for his decision to convict the appellant. All three members of the Court of Appeal (Roberts-Smith, Pullin and Buss JJA) rejected a ground of appeal that the verdict of guilty was unreasonable and could not be supported by the evidence. All three accepted the possibility of application of s 30(4) of the Criminal Appeals Act 2004 (WA), which empowers the Court of Appeal, having upheld a ground of appeal, to dismiss the appeal if it considers that no substantial miscarriage of justice has occurred ("the proviso"). The Court divided on whether the proviso should be applied. There are three grounds of appeal to this Court: "2.1. The Court of Appeal erred, having found that the learned trial judge had failed to provide adequate reasons, in finding that the proviso ... had any application. 2.2 Alternatively, the Court of Appeal erred in concluding, on the whole of the evidence, that the evidence from the record established that the appellant was guilty beyond reasonable doubt, and dismissing the appeal pursuant to s 30(4) of the Criminal Appeals Act. The Court of Appeal erred in failing to find that the verdict of guilty was unreasonable or could not be supported by the evidence." The charges and their background The complainant, a female, and the appellant, a male, are first cousins. They had known one another during the whole of their respective lives, and had lived near one another for much of that time. In February 2002, the complainant was aged 15 and the appellant was aged 13. In March 2003, following some sexual activity between the complainant and the appellant, the complainant fell pregnant. She told a female cousin, other members of her family, and the police, that the appellant was the father. She was ashamed, for reasons that included reasons of culture. She had an abortion. She told the authorities that she had not consented to the intercourse in consequence of which she became pregnant. It is evident from the charges that she also told of an occasion of alleged sexual contact between her and the appellant in February 2002. It seems probable that she said this was the first occasion of such a nature. In October 2004, the appellant was charged as follows: first, there were three counts of indecent dealing with a child between the ages of 13 and 16, relating to three separate aspects of the incident in February 2002; secondly, there was a charge of sexual penetration without consent on 30 March 2003; thirdly, there was a charge of indecent assault without consent on 25 April 2003. The appellant was convicted on the three counts of indecent dealing in February 2002, and received a non-custodial sentence (a supervision order). Consent was not an answer to those charges. The appellant was acquitted of the alleged offences of March and April 2003. In each case, the basis of the acquittal was that the State had failed to negative an honest and reasonable mistaken belief as to consent. It is the alleged indecent dealings in February 2002 that are the subject of the present appeal. In understanding the evidence, and the course of the trial, in relation to those offences it is necessary to keep in mind that it was not disputed that there were sexual relations between the complainant and the appellant in 2003, although the defence case was that they were consensual. According to a version of an act of sexual intercourse put to the complainant in cross- examination by counsel for the appellant, the complainant not only consented but in fact initiated the activity. She denied that allegation. It was put to the complainant that she was making up the story that she was an unwilling partner, partly because of shame at her pregnancy, and partly because she knew that if she, when over 16 (as she was in 2003), had sex with a boy of the appellant's age, she herself would have been committing an offence. The trial The trial was conducted, before Judge Wisbey, sitting without a jury, pursuant to the provisions of the Children's Court of Western Australia Act 1988 (WA), the appellant not having elected to be tried on indictment by the Supreme Court or the District Court. It is common ground that provisions of the Criminal Procedure Act 2004 (WA) ("the Criminal Procedure Act"), including ss 119(3) and 120(2), applied. There were only three witnesses: the complainant; a female cousin, who gave brief and unchallenged evidence that in April 2003 the complainant told her she was pregnant and that the appellant was the father; and the complainant's older sister, who was present, with the appellant and the complainant, on the occasion of the February 2002 incident, but who slept through it. The appellant did not give evidence. It may be that no decision was made about whether the appellant would give evidence until the end of the prosecution case. This is consistent with the lines of questioning taken in cross-examination of the complainant, which appear to have been designed to test the complainant's evidence, without confronting the complainant with any specific contrary version of events to which the appellant might be confined if he decided to give evidence. A large part of the complainant's evidence in chief and cross-examination related to the alleged offences of 2003. Enough has already been said about those issues to explain the background to the February 2002 allegations. The whole matter came to light, not because of any complaint in the colloquial sense, but because of the complainant's pregnancy, her identification of the appellant as the person responsible, her allegation of lack of consent, and investigation of the history of her sexual relations with her younger cousin. Part of the cross- examination about the events of 2002 seems to have been directed towards a suggestion that the occasion she described occurred later in that year; a possibility that may have been of significance in relation to her age at the relevant time. However, she was adamant that it was in February, and in that respect she was corroborated by her older sister. Since the suggestion made in cross-examination was not supported by evidence from the appellant or anyone else, the point was not pursued in final address. The complainant's evidence in chief was as follows. In February 2002, the complainant was living with her mother, sister and younger brother in Geraldton. The complainant's aunt, along with three of her children, including the appellant and the appellant's brother, visited Geraldton. The appellant was on his way to a boarding school at Tardun. The whole group decided to travel to Tardun and spend the night there in a caravan. Four of the children went to bed on a double bed mattress: the complainant, the complainant's sister, the appellant and the appellant's brother. The complainant said that she and the appellant were lying together with their heads at one end of the bed and her sister and the appellant's brother were lying with their heads at the other end of the bed. The complainant said that the appellant, early in the night, indecently touched her in three ways, including fondling her breasts and placing her hand on his penis. Repeatedly, the complainant in her evidence in chief described these events by saying "[the appellant] did this" or "[the appellant] did that". She said she had gone to sleep with the appellant next to her, and she was woken up by the appellant touching her. She then described his actions. Following these actions, according to the complainant, the complainant's aunt entered the caravan and the sleeping arrangements were altered. The complainant was not asked, in chief, how she knew the person touching her was the appellant. It was obviously a male; there were only two males in the bed, that is, her two cousins. The appellant, at least by 2003, undoubtedly had a sexual interest in the complainant. It is, perhaps, theoretically possible that such interest was awakened some time later than February 2002 and before April 2003. However, it was never suggested to the complainant that the other male (the appellant's brother) ever showed any sexual interest in her, or that there had ever been any sexual activity between them. Implicit in a suggestion that the person who was touching the complainant might not have been the appellant is, of course, the suggestion that it was the appellant's brother. Unless the complainant was inventing the entire incident, there was no one else it could have been. A number of questions put to the complainant in cross-examination expressly accepted that there was an occasion, in 2002, at Tardun, when the complainant, the appellant, the appellant's brother and the complainant's sister, were sharing a bed. The complainant was asked whether she told her mother, or her aunt, at the time what the appellant had done and she said she had not. It was put to her that "nothing happened" and she said "Definitely something happened". She was asked whether it could have been the appellant's brother who touched her, and she said: "I know it wasn't [the brother]." Pressed in cross-examination on the matter of identification, the complainant said that she did not look at the person who was touching her indecently, but she was adamant that she knew it was the appellant. She said the two brothers did not look alike. She also said she knew it was not the appellant's brother because of where people in the bed were sleeping. The complainant was cross-examined about a statement she made to police in May 2003, in which what she said about the position of the children in the bed was different from what she said in court. The statement was not tendered in evidence, so that the full extent of the inconsistency is unclear; but the complainant continued to maintain, in evidence, that it was the appellant, not the appellant's brother, who was lying next to her. It was the primary judge's manner of dealing with the issue of identification that involved what is accepted to have been a failure to give sufficient reasons for his decision. The trial was short. Addresses followed immediately upon the evidence, and the oral reasons for decision were given immediately following addresses. The reasons concerning the charges on which the appellant was acquitted (which were the more serious charges, involving alleged rape) were quite detailed. The reasons relating to the February 2002 incident were brief. Before they are set out, it should be noted that, in the course of the address of defence counsel, which immediately preceded the reasons for decision, the trial judge engaged squarely the issue of identification, and expressed his tentative views for counsel's comment. He asked whether, if the events described happened, it could have been anyone other than the appellant. He asked counsel why the evidence of later sexual penetration did not provide circumstantial support for the conclusion that "it was him on this occasion". He said: "[I]f [the appellant] had a sexual interest in her, that adds support to her evidence that he was the person alongside her and that he was the person who touched her". He referred to the complainant's evidence about the sleeping arrangements in the bed. If the learned judge had included in his reasons for his decision the matters that he put to counsel in the course of argument, there would have been no ground for complaint about the adequacy of his reasons. Regrettably, he did not do so. In his reasons, the judge began by setting out, adequately, for his own instruction, the elements of the offences charged. He then said: "Dealing with the first ... or perhaps before dealing specifically with the incidents, whilst talking generally about the complainant's evidence, it is to be observed that she did not make a complaint to anyone about any of these matters until it was ascertained that she was pregnant and required a therapeutic termination, and it was at that stage and only at that stage that she brought these matters to the attention of anyone. The fact that she had not complained earlier does not of course mean that these events did not occur, but the lack of prompt complaint is a matter the court must take into account in assessing her credibility generally. The impression I got from the complainant's evidence and the manner in which she gave it was that she is indeed terribly embarrassed about the situation here and for the reasons that she outlined, which in summary are that at her age, to be engaged in any sexual activity was inappropriate and the more so having regard to the relationship between herself and the [appellant] and the cultural issues involved. I am satisfied beyond reasonable doubt that the three dealings alleged in the first incident occurred and in the manner described by the complainant. I'm satisfied that ... those dealings occurred in the early part of the year 2002 when the complainant was under the age of 16 years. I am satisfied that the dealings were initiated by the [appellant] and although not the complainant, she did nothing to desist. That is not to the point, since to engage in sexual activity with a person under the age of 16 years, consensual or otherwise, is an offence and I am satisfied beyond reasonable doubt on the evidence that the [appellant] indecently dealt with the complainant in the three ways alleged. That is that he placed his hand on her breast, that he touched her vagina and that he placed her hand on his penis. invited and, one suspects, not appreciated by And the [appellant] will be convicted as charged in respect of each count of indecent dealing in the complaints before the court." The insufficiency of reasons Section 120(2) of the Criminal Procedure Act provides that the judgment of the judge in a trial by judge alone must include the principles of law that he or she has applied and the findings of fact on which he or she has relied. The effect of such a statutory requirement was considered by this Court in Fleming v The Queen1. All the members of the Court of Appeal agreed that the trial judge did not state his reasons for rejecting the appellant's arguments on identification. That he considered such arguments, and that he presented counsel, for comment, with substantial reasons why they may not be accepted, appears from the record of his exchanges with counsel in the course of address. However, such exchanges do not form part of a statement of the reasons for decision, and, in his stated reasons, the judge simply did not address the arguments of counsel at any level either of specificity or generality. He may well have thought that it was a fairly hopeless point, but it was seriously put and was not entirely lacking in substance. It was not sufficient to point out its weaknesses in the course of address; it had to be dealt with (although not necessarily at great length) in the reasons for decision. There being a question of identification raised, the judge was obliged to say why, and how, he resolved it in favour of the prosecution. This part of the appellant's argument has been made out. There was also an argument, based on s 119(3) of the Criminal Procedure Act that the judge should have given himself certain identification warnings. Having regard to the nature of the evidence in this case, it is hard to see exactly what warnings might have been apt. At all events, the complaint under s 120(2) being made out, error is shown, as all members of the Court of Appeal held. The reasonableness of the decision It is convenient to deal first with the appellant's third ground of appeal, which raises an argument that was considered and rejected by all members of the Court of Appeal. The ground (ground three) in the Court of Appeal was that "[t]he verdicts were unsafe and unsatisfactory … and have occasioned a miscarriage of justice in that a Jury properly instructed could not be satisfied beyond reasonable doubt that it was the Appellant who committed the offence." If the appellant were to succeed on this ground, he would be entitled, not to an order for a retrial, but to an acquittal. It is, therefore, necessary to decide whether it should be upheld. The leading judgment on the point was that of Pullin JA, who discussed a number of decisions of this Court on the application of the proviso, including M v The Queen2 and Weiss v The Queen3, and referred in detail to the evidence in chief and cross-examination of the complainant, which he analysed carefully. He considered the inconsistencies, said to have been revealed in cross-examination, between the complainant's evidence and what she (1998) 197 CLR 250 at 262-263 [28]; [1998] HCA 68. (1994) 181 CLR 487; [1994] HCA 63. (2005) 224 CLR 300; [2005] HCA 81. had said to the police about the location of people in the bed. He discussed the topic of the dangers of identification evidence, and the nature of the identification evidence in this case. He concluded that a reading of the whole of the evidence left him in no doubt that it was the appellant who touched the complainant. Roberts-Smith JA, who agreed with the reasons of Pullin JA, pointed out that the complainant had known the appellant all his life; that it was accepted that she had sexual relations with him at a time after February 2002; that he had a sexual interest in the complainant; and that there was no suggestion in the evidence that the only other male person in the bed, the appellant's brother, had ever shown any sexual interest in the complainant. The complainant adhered to her evidence that it was the appellant, not the appellant's brother, who lay alongside her. She had never expressed any uncertainty about who it was who touched her. Buss JA concluded that ground three had not been made out. He said that it had not been established that the nature and quality of the evidence at the trial was such that, acting reasonably, the trial judge ought to have had a doubt as to guilt. As will appear, his Honour would not have applied the proviso because the failure of the trial judge to make findings bearing on the reliability (as distinct from honesty) of the complainant made it impossible for an appellate court, with only the written record before it, to be satisfied beyond reasonable doubt that it was the appellant who indecently dealt with the complainant. This is a matter to which it will be necessary to return. Identification of the kind made by the complainant is not a process of logical reasoning. It is a form of perception based upon a combination of sensory experiences and perhaps intuition. Of course, honest but mistaken identification is commonplace. Here, however, there were only two possibilities, one of which was supported by the complainant's testimony and by circumstantial evidence. The alternative hypothesis was supported by nothing except a process of elimination. If the complainant was wrong in her perception that the person touching her was the appellant, then it must have been the appellant's brother. We agree with the conclusion of the Court of Appeal. Ground 2.3 in this Court has not been made out. The application of the proviso It was submitted on behalf of the appellant that some errors are so fundamental or involve such a departure from the essential requirements of a fair trial that they exclude the operation of the proviso, irrespective of the strength of the prosecution case, or the appellate court's view as to the guilt of the accused. Reference was made to Fleming v The Queen4. Furthermore, it was said, the proviso cannot be applied where the error at trial denies or substantially frustrates the capacity of an appellate court to decide whether a conviction is just5. As a matter of principle, these propositions are correct. The area of dispute is their application to the error in this case. The point of departure between the majority in the Court of Appeal and Buss JA concerned the application to the present case of the second proposition. It has already been noted that Buss JA rejected an argument that the nature and quality of the evidence at trial was such that the trial judge ought to have had a doubt as to the appellant's guilt. Hence, he would have quashed the conviction but would have ordered a retrial. However, in refusing to apply the proviso, after analysing the evidence of the complainant, he said: "In my opinion, s 30(4) of the Criminal Appeals Act should not be applied in this appeal. The identification of the appellant as the offender depended upon an assessment of the complainant's credit and reliability. Although, as I have mentioned, the learned Judge found that the complainant was 'generally a thoughtful and truthful witness as to the events about which she has spoken', his Honour did not evaluate her evidence in relation to identification and he did not make any findings as to her reliability. A witness who is honest is not necessarily reliable. I have examined the record of the trial, but I am unable to conclude that a verdict of guilty was the only verdict reasonably open on the evidence. The 'natural limitations' that exist in the case of an appellate court proceeding wholly or substantially on the record preclude my being satisfied beyond reasonable doubt that it was the appellant who indecently dealt with the complainant, and that no substantial miscarriage of justice has occurred in consequence of his conviction. In particular, I am unable satisfactorily to determine the reliability of the complainant from the transcript. Also, without seeing and hearing the complainant, I am unable to decide whether the manner in which she gave her evidence bore upon that issue. There is no basis upon which her demeanour can be dismissed as an irrelevant consideration. The complainant gave evidence at the trial on closed circuit television, but her evidence was not recorded on videotape." (1998) 197 CLR 250. 5 Nudd v The Queen (2006) 80 ALJR 614 at 618 [7]; 225 ALR 161 at 164; [2006] HCA 9. The trial judge did not merely say that he found the complainant to be honest. He said that she was "terribly embarrassed", but also "thoughtful". What else he might have said about her demeanour that would assist an appellate court is not clear. There were grave deficiencies in his statement of his reasons, resulting partly from his failure to repeat in his reasons the observations he made in the course of argument, but failure to give a further and better description of the complainant's demeanour was not one of them. Rather, we would take Buss JA to have been saying that, in the absence of a statement of the trial judge's reasons for accepting the complainant on the matter of identity, it was not possible for an appellate court, on the written record, to make the decision necessary for the application of the proviso. His reference to "natural limitations" was a reference to a passage in the decision of this Court in Weiss6. There is force in the concerns of Buss JA as to the position in which the trial judge's failure to give reasons left the Court of Appeal. It is not to be doubted that there will be cases in which a failure to give reasons will leave an appellate court in no position to apply the proviso. At the same time, it should be remembered that the most common case, in practice, for the application of the proviso is a case of trial by jury, where there are no reasons for decision and, obviously, no findings upon or descriptions of demeanour. The "natural limitations" referred to in Weiss may apply, but if absence of reasons for a guilty verdict were conclusive then the proviso could never apply to trial by jury. We have referred above to the reasoning of Pullin JA and Roberts- Smith JA on the third ground of appeal. It is unnecessary to repeat it. We see no answer to a point that weighed heavily with the majority: the fact that the only competing possibility was that the complainant was indecently dealt with by the appellant's brother. All three members of the Court of Appeal accepted that somebody had indecently dealt with the complainant on the occasion she described; that it was a male; and that it could only have been either the appellant or his brother. The complainant's certainty that it was the appellant was obviously based partly upon a rejection of the idea that it was the brother. By the time she gave her evidence, she had been through a sexual association with the appellant; an association that, for her, had very serious consequences. There was nothing to suggest that the brother had ever been, or wanted to be, sexually involved with her. Circumstantial evidence is sometimes spoken of as though it were inherently less compelling than direct testimony. Often, especially in Undisputed objective identification cases, circumstances may be more reliable than direct testimony. Here, the direct testimony of the complainant was supported by circumstantial evidence. There was no conflict of evidence between the complainant and some other witness. the opposite. truth the (2005) 224 CLR 300 at 316 [41]. An evaluation of the complainant's uncontradicted testimony, supported as it is by undisputed circumstantial evidence, was possible on the basis of the written record of the proceedings. The reasoning of the majority of the Court of Appeal appears to us to be well-founded and the conclusion correct. Conclusion The appeal should be dismissed. GUMMOW AND HAYNE JJ. In October 2004, the appellant, then aged 15, was charged in the Children's Court of Western Australia with three counts of indecent dealing with a child contrary to s 321(4) of The Criminal Code (WA). These offences were alleged to have occurred in February 2002 at Geraldton. At that time the appellant was aged 13 and the complainant 15. The appellant was also charged with two further offences which it was alleged he had committed against the complainant: one count of sexual penetration without consent and one count of indecent assault. These further offences were alleged to have occurred in March 2003 and April 2003 respectively. All the offences charged were indictable offences. The appellant did not elect7 to be tried on indictment in the Supreme Court or the District Court. Section 19 of the Children's Court of Western Australia Act 1988 (WA) ("the Children's Court Act") gave the Children's Court jurisdiction to hear the offences charged even though they were indictable offences. The appellant was tried in the Children's Court by judge alone (Judge Wisbey). The appellant was acquitted of the counts of sexual penetration without consent and indecent assault but convicted of the three counts of indecent dealing. He was sentenced to an intensive youth supervision order8. That order has long since expired, but the Community Protection (Offender Reporting) Act 2004 (WA) imposes on a child convicted of the offences of indecent dealing of which the appellant was convicted certain obligations which continue for at least seven and a half years9. The offences of indecent dealing were alleged to have occurred in a caravan, at night. Four children – the appellant, the complainant, the complainant's sister (aged about 16) and the appellant's brother (aged about 14) – were put to bed in the caravan. All were to sleep on the one bed. At the appellant's trial, the complainant said that she had gone to sleep with the appellant on one side of her, and her sister on the other. During the night she was woken by someone touching her. The person touched her breasts and her vagina and then took her hand and put it on his penis. The complainant gave her evidence in a way that revealed no doubt in her mind that it was the appellant who had done this. She was pressed in cross-examination to explain how she knew it was him. She said that she knew it 7 Children's Court of Western Australia Act 1988 (WA), s 19B. 8 Young Offenders Act 1994 (WA), s 98. 9 Community Protection (Offender Reporting) Act 2004 (WA), ss 46-47. was him "[b]ecause it ... he was laying next to me and I knew it was him". But further cross-examination elicited evidence to the effect that she had not looked at who it was who was touching her, either during or after the incident, and she agreed that the caravan was "[d]ark enough so that you couldn't see other people". Section 37(2)(a) of the Children's Court Act provided that, subject to some exceptions that are not now relevant, the practice and procedure of the Court when exercising the jurisdiction conferred by s 19(1) "shall be that provided by the Criminal Procedure Act 2004" (WA). Section 120 of the latter Act provided: In a trial by a judge alone – the judge may make any findings and give any verdict that a jury could have made or given if the trial had been before a jury; and any finding or verdict of the judge has, for all purposes, the same effect as a finding or verdict of a jury. The judgment of the judge in a trial by a judge alone must include the principles of law that he or she has applied and the findings of fact on which he or she has relied. The validity of a trial judge's judgment is not affected by a failure to comply with subsection (2)." The trial judge was thus bound by s 120(2) to provide reasons that included the principles of law that were applied and the findings of fact on which the judge relied. In his reasons for judgment, delivered ex tempore, the trial judge stated his conclusion that he "thought that the complainant was generally a thoughtful and truthful witness as to the events about which she has spoken". But apart from noticing some concessions the complainant made in cross-examination and the absence of any prompt complaint about the events the subject of the charges of indecent dealing, the trial judge did no more than state his satisfaction, beyond reasonable doubt, that each of the elements of the offences had been established. The reasoning which led to that conclusion was not stated. The appellant appealed to the Court of Appeal of the Supreme Court of Western Australia against his convictions. That Court (Roberts-Smith and Pullin JJA, Buss JA dissenting) dismissed10 the appeal. The appellant's ground 10 AK v The State of Western Australia [2006] WASCA 245. of appeal alleging that the convictions were "unsafe and unsatisfactory", in the sense that it was not open to the tribunal of fact to conclude that the appellant's guilt had been established beyond reasonable doubt, was rejected. All members of the Court of Appeal accepted11, however, that the trial judge had not given reasons that complied with the requirements of s 120(2) of the Criminal Procedure Act 2004 (WA) ("the Criminal Procedure Act"). The Court of Appeal divided about whether, notwithstanding this error, the appeal to that Court should nonetheless be dismissed on the basis that no substantial miscarriage of justice had occurred. By special leave, the appellant appeals to this Court. For the reasons given by Heydon J, the appellant's argument in this Court that the Court of Appeal should have held the verdicts of guilty to be unreasonable or such as could not be supported by the evidence should be rejected. The Court of Appeal's conclusion that the trial judge did not give reasons that complied with s 120(2) of the Criminal Procedure Act was not challenged in this Court. But whether the Court of Appeal was right to conclude (as the majority in that Court did) that no substantial miscarriage of justice had occurred was in issue, and these reasons will show that the Court of Appeal erred in deciding that there had been no substantial miscarriage of justice. The principal provision of the Criminal Appeals Act 2004 (WA) ("the Criminal Appeals Act") which governed the disposition of the appellant's appeal against his convictions was s 30(3). It provides that the Court of Appeal must allow an appeal against conviction if, in its opinion, any of three kinds of ground is made out. The first relates to setting aside a verdict of guilty "because, having regard to the evidence, it is unreasonable or cannot be supported". It is this ground that the appellant sought to engage with the argument that the convictions were unsafe and unsatisfactory. It need not be further examined in this appeal. The second kind of ground for which s 30(3) provides is that there was "a wrong decision on a question of law by the judge"; the third is that "there was a miscarriage of justice". Both of these grounds were said to be engaged in the present matter. Section 30(4) of the Criminal Appeals Act stands in essentially the same relationship with the provisions of s 30(3) as the proviso has to the common form appellate provisions derived from the Criminal Appeal Act 1907 (UK). Section 30(4) provides that: 11 [2006] WASCA 245 at [1] per Roberts-Smith JA, [31]-[35] per Pullin JA, [66]-[70] per Buss JA. "Despite subsection (3), even if a ground of appeal might be decided in favour of the offender, the Court of Appeal may dismiss the appeal if it considers that no substantial miscarriage of justice has occurred." The focus of attention in the Court of Appeal in the present matter was whether that Court should be satisfied on the record of the trial that the evidence led at the appellant's trial proved beyond reasonable doubt his guilt of the three counts of indecent dealing. Two members of the Court (Roberts-Smith and Pullin JJA) concluded that a reading of the whole of the evidence led at trial left no doubt that it was the appellant who touched the complainant and committed the offences12 and, that being so, that s 30(4) was engaged. The third member of the Court (Buss JA) was "unable to conclude that a verdict of guilty was the only verdict reasonably open on the evidence"13. The Court of Appeal was wrong to focus only upon whether that Court could conclude from the written record of the evidence properly admitted at trial that the appellant was proved beyond reasonable doubt to be guilty of the offences charged. To approach the matter in that way paid insufficient regard to the error of law or miscarriage of justice which, by operation of s 30(3), otherwise required the Court to allow the appeal. To explain further why that approach was erroneous it is necessary to begin by saying something more about the ground of appeal that was made out in the Court of Appeal: that the trial judge did not give reasons that complied with s 120(2) of the Criminal Procedure Act. Section 120(2) requires that the judge's reasons include the principles of law that he or she has applied. The principles of law that are relevant will be identified by reference to the issues in the case. Usually, then, a trial judge will be obliged to identify and record in the reasons what are the elements of the offence in question and which of those elements were in issue. Resolution of the issues in the case will then require not only statement in the reasons of both the principles of law that are applied and the findings of fact the judge makes, but also statement of "the reasoning process linking them and justifying the [findings of fact] and, ultimately, the verdict that is reached"14. In the present case, the trial judge made several references to the relevant standard of proof. To that extent the trial judge's reasons stated an applicable 12 [2006] WASCA 245 at [7] per Roberts-Smith JA, [50] per Pullin JA. 13 [2006] WASCA 245 at [85]. 14 Fleming v The Queen (1998) 197 CLR 250 at 263 [28]; [1998] HCA 68. legal principle. But nowhere in the reasons for judgment did the trial judge articulate how the link was made between the legal principle requiring proof beyond reasonable doubt and the findings of fact that the appellant had touched the complainant in the manner alleged. The issue at the trial was who had touched the complainant. The trial judge accepted that the complainant believed that it was the appellant who had done that. But the sincerity of the complainant's belief in that regard was not the central issue at the trial. The central issue was whether her belief was accurate. And although the trial judge expressed himself to be satisfied beyond reasonable doubt that the appellant had touched the complainant in the manner alleged, the trial judge did not say by what process of reasoning that conclusion was reached. The significance of this omission is to be assessed in the manner described by this Court in Fleming v The Queen15. There the Court considered the application of provisions of the Criminal Procedure Act 1986 (NSW) which, in relevant respects, are substantially the same as the provisions of s 120 of the Criminal Procedure Act in issue in the present matter. In particular, the Court in Fleming was required to consider the New South Wales provision16 requiring that "[a] judgment by a Judge in [a criminal proceeding tried without a jury] must include the principles of law applied by the Judge and the findings of fact on which the Judge relied". Failure to comply with these requirements was held 17 to be a wrong decision on a question of law and it was accepted that it may also mean that justice had miscarried. As the Court's reasons in Fleming explained18, if a judgment fails to show that the judge applied a relevant principle of law, two possibilities are presented. One possibility is that, notwithstanding the failure, the principle was applied. Adapting what was said in Fleming to the applicable Western Australian provisions, if that is so, there has been a breach of s 120(2) of the Criminal Procedure Act by reason of the omission from the judgment. The other possibility is that the principle was not applied, with the result that, independently of the question of breach of s 120(2), there has been an error of law which would attract at least s 30(3)(b) of the Criminal Appeals Act (wrong decision on a question of law) or, we would add, s 30(3)(c) (miscarriage of 15 (1998) 197 CLR 250. 16 Criminal Procedure Act 1986 (NSW), s 33(2). 17 Fleming (1998) 197 CLR 250 at 262 [27]. 18 (1998) 197 CLR 250 at 263 [30]. justice). And as the Court went on to say19, "[u]nless the judgment shows expressly or by implication that the principle was applied, it should be taken that the principle was not applied, rather than applied but not recorded". All three members of the Court of Appeal concluded that the trial judge's reasons were deficient. Pullin JA, with whose reasons Roberts-Smith JA generally agreed, considered20 that it was necessary in this case for the trial judge "to identify the fact that there was an issue about identification" and to refer to the case which the prosecution and the appellant had each sought to make at trial. The prosecution case was said21 by Pullin JA to be founded in "the complainant's express statement that she perceived the appellant as being the person who touched her, the circumstantial evidence arising from the later sexual interest the appellant showed in the complainant, the lack of any interest shown by the other boy [and] the position of the people on the mattress". (The reference to "later sexual interest" included reference to the events which founded the fourth and fifth counts against the appellant. These events had occurred about 14 months after the alleged indecent dealings in the caravan.) The defence case was identified22 as being "that the complainant's evidence was unreliable, that her sense of touch did not enable her to identify the appellant and that she could not by visual or aural means identify the appellant". The third member of the Court of Appeal, Buss JA, expressed the deficiencies in the trial judge's reasons in different terms. He noted23 that the trial judge had not referred to any of the complainant's evidence relating to who had touched her and, in particular, did not mention any of the uncertainties or inconsistencies in that evidence. Further, as Buss JA pointed out24, the trial judge "did not explain why he found that it was the appellant (and not his brother) who had indecently dealt with her". Failure to evaluate and make findings about the reliability of the complainant's evidence in the context of the circumstances of the alleged offences and the complainant's evidence as a whole was held25 to constitute an error of law. 19 (1998) 197 CLR 250 at 263 [30]. 20 [2006] WASCA 245 at [31]. 21 [2006] WASCA 245 at [31]. 22 [2006] WASCA 245 at [31]. 23 [2006] WASCA 245 at [69]. 24 [2006] WASCA 245 at [69]. 25 [2006] WASCA 245 at [69]. The conclusion that the trial judge had thus committed an error of law of the kind identified in Fleming required that the appellant's appeal to the Court of Appeal be allowed unless the provision equivalent to the proviso to the common form criminal appeal statute (s 30(4) of the Criminal Appeals Act) was engaged. In Weiss v The Queen26, the Court emphasised the need when applying a statutory provision to look to the language of the statute rather than secondary sources or materials. With respect to the proviso to the common form criminal appeal statute the Court said27: "It is neither right nor useful to attempt to lay down absolute rules or singular tests that are to be applied by an appellate court where it examines the record for itself, beyond the three fundamental propositions mentioned earlier. (The appellate court must itself decide whether a substantial miscarriage of justice has actually occurred; the task is an objective task not materially different from other appellate tasks; the standard of proof is the criminal standard.) It is not right to attempt to formulate other rules or tests in so far as they distract attention from the statutory test. It is not useful to attempt that task because to do so would likely fail to take proper account of the very wide diversity of circumstances in which the proviso falls for consideration." In Weiss, the Court identified one circumstance in which the proviso to the common form criminal appeal statute cannot be engaged. The Court said28 that the proviso cannot be engaged "unless the appellate court is persuaded that the evidence properly admitted at trial proved, beyond reasonable doubt, the accused's guilt of the offence on which the jury returned its verdict of guilty". This negative proposition (about when the proviso cannot be engaged) must not be treated as if it states what suffices to show that no substantial miscarriage has occurred. To treat the negative proposition in this way would be to commit the very same error which Weiss sought to correct, namely, taking judicial statements about aspects of the operation of statutory provisions as substitutes for the statutory language. Likewise, what was said in Wilde v The Queen29 about the possibility that some errors or miscarriages of justice occurring in the course of a criminal trial 26 (2005) 224 CLR 300 at 312-313 [31]-[33]; [2005] HCA 81. 27 (2005) 224 CLR 300 at 316 [42]. 28 (2005) 224 CLR 300 at 317 [44]. 29 (1988) 164 CLR 365 at 373; [1988] HCA 6. may amount to such a serious breach of the presupposition of the trial as to deny the application of the proviso is not to be taken as if it were a judicially determined exception grafted upon the otherwise general words of the relevant statute. Rather, as both Wilde and Weiss acknowledged, the operation of the proviso in the common form criminal appeal statute will fall for consideration in a very wide variety of circumstances. What was said in Wilde did no more than advert to a particular class of such circumstances in which the error or errors at trial are properly seen as radical. In every case it will be necessary to consider the application of the proviso (and here s 30(4)) taking proper account of the ground or grounds of appeal that have been made out and which, but for the engagement of the proviso, would require the appellate court to allow the appeal. In the present case there were two features of the error identified as occurring at trial which are important in deciding whether the Court of Appeal could conclude "that no substantial miscarriage of justice has occurred"30. First, s 120(2) of the Criminal Procedure Act required the reasons to articulate the connection identified between the relevant legal principle (in this case, proof beyond reasonable doubt) and the relevant findings of fact. Second, the particular failure that was identified related to the central issue in the appellant's trial on the counts of indecent dealing and was constituted by the complete failure to articulate any of the reasoning by which the trial judge reached the ultimate conclusion that the appellant was guilty of each of those charges. Complete failure to meet the mandatory requirements of s 120(2) of the Criminal Procedure Act with respect to the central issue in the appellant's trial was a substantial miscarriage of justice. It was a substantial miscarriage because the Criminal Procedure Act required that the trial of the appellant yield a reasoned decision that met the criteria stated in the statute. This trial did not, and it did not in respect of the central issue that was tried. Section 120(3) provides that "[t]he validity of a trial judge's judgment is not affected by a failure to comply" with the requirements of s 120(2). But that provision addresses only the question of validity of the orders made, a question which was once answered by reference to a distinction between directory and mandatory requirements31. Failure to comply with s 120(2) does not render void the court's orders convicting and sentencing an offender. It was not, and could not be suggested, however, that s 120(3) denies that a failure to comply with 30 Criminal Appeals Act 2004 (WA), s 30(4). 31 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 388-391 [91]-[93] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28. s 120(2) is an error of law. And when read as a whole, s 120 makes plain that the result of trial by judge alone must be a reasoned decision that complies with Once it is recognised that the Criminal Procedure Act requires that a trial by judge alone is to be concluded in this way, it is evident that to examine, as the Court of Appeal did, whether a chain of reasoning could be articulated that would support, even require, the verdict that was reached at trial was not to the point in deciding whether there was a substantial miscarriage of justice. It was not to the point because the relevant error or miscarriage which is the premise for consideration of the proviso is an error or miscarriage constituted by a failure to provide, as s 120(2) required, a reasoned decision about the central issue that was tried. The appellant was not tried in accordance with the requirements of s 120. When there has been a trial by jury, and an appellate court concludes that the trial judge made a wrong decision on a question of law or that there was some other miscarriage of justice, deciding whether there has been no substantial miscarriage of justice necessarily invites attention to whether the jury's verdict might have been different if the identified error had not occurred. That is why, if the appellate court is not persuaded beyond reasonable doubt of the appellant's guilt it cannot be said that there was no substantial miscarriage of justice. But just as persuasion of the appellate court of the accused's guilt does not in every case conclude the enquiry about the proviso's application in appellate review of a jury trial, enquiring about the weight of the evidence led at a trial by judge alone does not determine whether there was a substantial miscarriage of justice. In a case, like the present, where the Criminal Procedure Act required that the trial yield a reasoned decision, but no reasons were given for the determination of the central issue tried, it cannot be said that there was no substantial miscarriage of justice. The appeal to this Court should be allowed. The order of the Court of Appeal of the Supreme Court of Western Australia made on 17 November 2006 should be set aside and in its place there should be orders that the appeal to that Court is allowed and the appellant's convictions are quashed. There should be a direction for a new trial. Whether that trial occurs is a matter for the prosecuting authorities. HEYDON J. The background is set out by Gleeson CJ and Kiefel J32. Statutory provisions The statutory provisions relating to trial by judge alone in Western Australia are to be found in the Criminal Procedure Act 2004 (WA) ("the Criminal Procedure Act")33. Section 118 provides: If an accused is committed on a charge to a superior court or indicted in a superior court on a charge, the prosecutor or the accused may apply to the court for an order that the trial of the charge be by a judge alone without a jury. (2) Any such application must be made before the identity of the trial judge is known to the parties. (3) On such an application, the court may inform itself in any way it thinks fit. (4) On such an application the court may make the order if it considers it is in the interests of justice to do so but, on an application by the prosecutor, must not do so unless the accused consents. 33 There have been similar but not identical provisions since 1985 in South Australia (Juries Act 1927, s 7), since 1991 in New South Wales (Criminal Procedure Act 1986, ss 132-133) and since 1993 in the Australian Capital Territory (Supreme Court Act 1933, ss 68B-68C). These provisions are inconsistent with s 80 of the Constitution so far as proceedings for Commonwealth offences are concerned, since s 80 rights cannot be waived: Brown v The Queen (1986) 160 CLR 171. In the United Kingdom, limited provision for trial by judge alone on indictable offences was introduced in 2003 by the Criminal Justice Act, s 43 (not yet in force – complex fraud cases) and s 44 (danger of jury tampering); s 48(5)(a) obliges the judge sitting alone to give a judgment stating the reasons for the conviction. In New Zealand, since 1979 ss 361B and 361C of the Crimes Act 1961 have permitted trial by judge alone; although there is no statutory duty to give reasons, the courts have created one: R v Connell [1985] 2 NZLR 233 at 237-238; R v Eide (Note) [2005] 2 NZLR 504. In Canada, ss 469, 473, 536, 561, 568 and 569 of the Criminal Code provide for trial by judge alone in certain circumstances. In the United States, r 23(a) of the Federal Rules of Criminal Procedure for the United States District Courts permits trial by judge alone if the defendant waives a jury trial in writing, the government consents and the court approves; for the history, see Singer v United States 380 US 24 (1965). (5) Without limiting subsection (4), the court may make the order if it considers – that the trial, due to its complexity or length or both, is likely to be unreasonably burdensome to a jury; or that it is likely that acts that may constitute an offence under The Criminal Code section 123 would be committed in respect of a member of a jury. (6) Without limiting subsection (4), the court may refuse to make the order if it considers the trial will involve a factual issue that requires the application of objective community standards such as an issue of reasonableness, negligence, indecency, obscenity or dangerousness. If an accused is charged with 2 or more charges that are to be tried together, the court must not make such an order in respect of one of the charges unless the court also makes such an order in respect of each other charge. If 2 or more accused are to be tried together, the court must not make such an order in respect of one of the accused unless the court also makes such an order in respect of each other accused. If such an order is made, the court cannot cancel the order after the identity of the trial judge is known to the parties." Section 119 provides: In a trial by a judge alone, the judge must apply, so far as is practicable, the same principles of law and procedure as would be applied in a trial before a jury. In a trial by a judge alone, the judge may view a place or thing. If any written or other law – requires information or a warning or instruction to be given to the jury in certain circumstances; or prohibits a warning from being given to a jury in certain circumstances, the judge in a trial by a judge alone must take the requirement or prohibition into account if those circumstances arise in the course of the trial." Section 120 provides: In a trial by a judge alone – the judge may make any findings and give any verdict that a jury could have made or given if the trial had been before a jury; and any finding or verdict of the judge has, for all purposes, the same effect as a finding or verdict of a jury. The judgment of the judge in a trial by a judge alone must include the principles of law that he or she has applied and the findings of fact on which he or she has relied. The validity of a trial judge's judgment is not affected by a failure to comply with subsection (2)."34 It is desirable also to set out the provisions of s 30(1)-(4) of the Criminal Appeals Act 2004 (WA) ("the Criminal Appeals Act"): "(1) This section applies in the case of an appeal against a conviction by an offender. (2) Unless under subsection (3) the Court of Appeal allows the appeal, it must dismiss the appeal. The Court of Appeal must allow the appeal if in its opinion – the verdict of guilty on which the conviction is based should be set aside because, having regard to the evidence, it is unreasonable or cannot be supported; the conviction should be set aside because of a wrong decision on a question of law by the judge; or there was a miscarriage of justice. (4) Despite subsection (3), even if a ground of appeal might be decided in favour of the offender, the Court of Appeal may dismiss the appeal if it considers that no substantial miscarriage of justice has occurred." 34 No argument in relation to s 120(3) was advanced. Below the application of s 30(4) will be described as "applying the proviso". In addition, s 24(2)(e)(ii) of the Criminal Appeals Act provides: "The prosecutor may also appeal to the Court of Appeal against any one or more of the following decisions by a judge of a superior court in relation to a charge of an indictable offence – a judgment of acquittal (other than a judgment of acquittal on account of unsoundness of mind) – entered in a trial by the judge alone."35 Sections 24(2)(e)(ii) and 30 of the Criminal Appeals Act and ss 118-120 of the Criminal Procedure Act were all introduced on 2 May 2005. Ground 3: failure to find that the verdict was unreasonable or not supported by evidence Ground 3 contended that the Court of Appeal erred in failing to find that the verdict of guilty was unreasonable or could not be supported by the evidence. If made out, ground 3 would result in an order of acquittal, for it would not ordinarily be right to order a new trial so that the prosecution could attempt to improve its evidence on a future occasion36. If either ground 1 or ground 2 were made out, the result would ordinarily be only an order for a new trial. Thus success on ground 1 or ground 2 is a less satisfactory outcome for the appellant than success on ground 3. It is thus necessary to deal with ground 3 and it is desirable to do so at the outset, for, if ground 3 is made out, it is unnecessary to deal with the other two grounds. How did the complainant identify the accused? One main issue at the trial was identification: whether the accused was the person who behaved in the manner complained of by the complainant. The most common form of identification evidence is evidence of visual identification. A less common, but fairly standard, form is identification by sound (by voice, or by distinctive coughing or breathing, for example) – aural identification37. A possible, though 35 See also Crimes (Appeal and Review) Act 2001 (NSW), s 107(1)(b); Criminal Law Consolidation Act 1935 (SA), s 352(1)(ab). 36 R v Taufahema (2007) 228 CLR 232 at 256 [52]; [2007] HCA 11. 37 Bulejcik v The Queen (1996) 185 CLR 375; [1995] HCA 54. rarer, form of identification is identification by touch, as where the person identified has some peculiar feature – for example, some corrugation or deformity or texture of the skin. Identification by smell or taste is likely to be even rarer, at least in relation to the identification of human beings as distinct from things38, but it is possible. Where a witness gives direct evidence of personal experience, generally that evidence can only be given as a result of experience through one of the five senses in the manner just indicated39. It was a central aspect of the appellant's argument in relation to ground 3 that the complainant did not do this in relation to the first three charges. Thus she did not give any evidence that she identified the offender as the accused by reason of smell or taste. She gave no evidence that the offender spoke or emitted any sound; in fact she denied that he spoke. The complainant excluded the possibility of identification by sight: she said that it was too dark to see and she also said that she did not see or look at the offender40. In this respect her evidence contrasted with her positive visual identification of the accused in relation to the 30 March 2003 charge by reason of his height, his body shape and his curly hair which she "could see ... when the light came shining through the door". The only evidence relating to the sense of touch given by the complainant was that the offender tickled her back to wake her up, pulled her right leg over so she could lie on her back, placed his hands on her breasts for three to five minutes, touched her stomach and vagina, grabbed her hand and placed her hand on his penis. But, as will be discussed more fully below41, the complainant did not say that she identified the offender by her sense of touch. How, then, did she conclude that the appellant was the offender, apart from inferring from the circumstance, if it was a circumstance, that when the children lay down to sleep she was next to the appellant, not the other boy ("R")? She denied "presuming" – that is, "surmising or guessing" – that the accused was the offender. She repeatedly said that she "knew" that the offender was the accused. But she also said that she "assumed" the offender was the accused. In re-examination counsel for the prosecution returned to the subject: 38 Union v State 66 SE 24 (Ga App, 1909) ("the liquid ... smelled like whisky"); Sherrard v Jacob [1965] NILR 151 at 160 ("felt and smelt") (quoting Attorney- General (Ruddy) v Kenny (1960) 94 ILTR 185 at 191 per Kingsmill Moore J); R v Farr (2001) 118 A Crim R 399 (odour of cannabis on accused's breath). 39 Ogden v People 25 NE 755 (Ill, 1890). 40 This retracted an earlier answer to the contrary. "How do you know it was him who touched you? Because I know for a fact. Like, I just know it was [the appellant]. It wouldn't – it wasn't [R] and it – And why do you say it wasn't [R]? I don't know. Like, [R] – I don't know, it's just [R] was different." inferential reasoning. The admissibility of No objection was taken to the form of the complainant's evidence of identification. Particularly in cross-examination, the questions sought to elicit conclusions based on the complainant's evidence is highly questionable, but let it be assumed either that it was admissible or that, though technically inadmissible, it can now be relied on because of the absence of objection. The question arises: How could it rationally establish that the appellant was the offender? Counsel for the appellant in his address to the trial judge criticised its capacity to do this on the ground of circularity. This may have been going too far, but in truth the only reason capable of being extracted from her evidence for her belief that the appellant was the offender was her contention that when the children lay down to sleep the appellant was next to her. In the Court of Appeal, Pullin JA considered that a matter establishing the reasonableness and supportability of the verdict was "that, despite the determined efforts made in cross-examination to throw doubt on the complainant's identification of the appellant, the complainant never wavered in her evidence that it was the appellant who touched her" and that it was "entirely unshaken"42. She "steadfastly held" to it, and there was "certainty [in] her evidence" 43. However, the probative value of evidence which a witness has "never wavered" about and is "entirely unshaken" about has to be assessed rationally, however "steadfastly" the witness holds to it and however much "certainty" the witness expresses. The complainant gave no reason why the evidence had any probative value which was distinct from her evidence about where the children were when they went to sleep. Pullin JA treated the complainant's evidence as being evidence that she identified the appellant by touch. He said44: "[T]he complainant gave evidence that she identified the offender as the appellant via her sense of touch." He 42 AK v The State of Western Australia [2006] WASCA 245 at [42]. 43 AK v The State of Western Australia [2006] WASCA 245 at [48]. 44 AK v The State of Western Australia [2006] WASCA 245 at [28]. See also at [29]. discussed cases on visual and voice identification, and said the same considerations applied to identification by touching45. He then said46: "[T]he complainant gave evidence she had known the appellant for all her life. They were cousins and had close contact with each other. She was also familiar with the appellant's brother. The appellant was later intimately involved with the complainant. This later evidence of sexual activity and touching is relevant retrospectant evidence, just as in the case of voice identification where a witness may acquire knowledge of the accused's voice after the event in issue." There is no doubt that if one accepts the complainant's evidence, she had at least four opportunities, apart from the incidents underlying the first three charges, to become familiar, in a sexual context, with the sensations of touching the appellant's skin and being touched by it: they were opportunities connected with the event underlying the fourth charge, the event underlying the fifth charge, an uncharged act of which she gave evidence without prior warning and some other sexual contacts. It is also probable that she had touched her cousin in non- sexual contexts during the years they had known each other. But there could not in this case be evidence of "identification by touch" unless the complainant explained, however briefly, what it was about touching the appellant that made identification of him possible – some peculiar mark, wart, growth, scarring or deformity, some unusual softness or roughness or scaliness or moistness or dryness or oiliness of skin. The form in which identification evidence is given in chief has some importance as a matter of fairness to cross-examiners. The complainant's evidence that she was woken by the appellant "touching" her did not explain how the touching enabled her to identify him. The evidence of the dealings between the appellant and the complainant in 2003 was not relied on to establish that she then noticed features of the appellant's skin which enabled her to identify him as the assailant in 2002: it was only relied on to support a circumstantial inference that he had a motive – sexual attraction – for his conduct in 2002 which was observable in 2003. It is not correct to describe her, on the strength of that testimony, as having given "evidence that she identified the offender as the appellant via her sense of touch"47. Thus Buss JA was, with respect, correct to say that the complainant's evidence that she was woken by the appellant "touching me"48: 45 AK v The State of Western Australia [2006] WASCA 245 at [43]-[46]. 46 AK v The State of Western Australia [2006] WASCA 245 at [47]. 47 AK v The State of Western Australia [2006] WASCA 245 at [28]. 48 AK v The State of Western Australia [2006] WASCA 245 at [82]. "does not constitute a satisfactory basis for concluding that the complainant identified the appellant as the offender from the manner in which she was touched. The basis for her assertion that it was the appellant who touched her was not explained or explored at the trial. For example, the complainant did not say that her evidence that she was woken up by '[the appellant] touching me' was based upon her experience, either before or after the occurrence of the relevant events, of being touched by the appellant. None of the complainant's other evidence established that she identified the appellant as the offender 'via her sense of touch'." And Roberts-Smith JA, too, correctly said49: "[T]he complainant was not purporting to identify the appellant as the person [sexually] interfering with her in the bed that night by her sense of touch (in that she was saying she was able to do so by some tactile characteristic which she recognised)". Pullin JA conceded that "the complainant had difficulty in articulating the propositions involved in her evidence that it was the appellant who touched her". He said that this was "not at all surprising"50. He referred to the remarks of O'Brien CJ Cr Div in R v E J Smith51 in relation to voice identification, which he "[W]hile many features of a person which are visually noticeable are fairly readily capable of description so as to give reasonable reproduction in every day vocabulary, the features of a voice are not by any means as readily capable of verbal description. The Chief [Judge] gave an example of the fact that a person will readily recognise the voice of a political figure heard regularly on the electronic media, but will be quite unable to convey by words the impression of that voice to one who has not heard it. The same comments apply to the fact that a person may become familiar with a person's touch. On the two occasions when the complainant was asked (ie by the police in 2003 and then at trial) about who touched her in February 2002 it was after the complainant had experienced other occasions when she had been touched in a sexual way by the appellant." 49 AK v The State of Western Australia [2006] WASCA 245 at [5]. 50 AK v The State of Western Australia [2006] WASCA 245 at [48]. 51 [1984] 1 NSWLR 462 at 478. 52 AK v The State of Western Australia [2006] WASCA 245 at [48]. This does not overcome the difficulty under discussion. While it may be hard (although it is not impossible) to isolate some of those aspects of touching which enable identification by touch, the fact remains that the complainant never sought to say that her identification was based on touching. And if the complainant's confidence that it was the appellant who touched her was a form of perception based on a combination of sensory experiences and intuition, she did not identify what the sensory experiences were, or, even assuming that "intuition" can be admissible, what the basis for the intuition was. Hence the complainant's evidence cannot be rendered either admissible or of probative value by seeking to explain her inarticulateness on the ground of the inherent difficulty of explaining an intuition, nor on the ground of her claims to be embarrassed or to be experiencing shame, nor by the repeated claim of prosecution counsel, strenuously denied by defence counsel, that she was not "a particularly sophisticated person". Similarly, while Roberts-Smith JA said that the complainant "was familiar with [the appellant's] presence and identified him in that way"53, she never specified which features of the appellant's "presence" she employed to identify him. The evidence other than the "identification" evidence. The appellant submitted in this Court that given the lack of probative value of the complainant's identification evidence there was a real and substantial possibility that the appellant was innocent54. In considering that submission, the complainant's identification evidence should be excluded from consideration on the ground that, even if it was admissible or capable of being treated as admissible, it is lacking in any probative value. However, even if that evidence is left out of consideration, and even if another trier of fact sitting in the trial judge's position might have reached a different conclusion, it cannot be said that his verdict should be set aside "because, having regard to the evidence, it is unreasonable or cannot be supported"55. That is because of the evidence other than the complainant's identification evidence in the case. The complainant gave admissible evidence of two groups of relevant circumstances. One concerned the fact that she went to sleep next to the accused. This was inconsistent with what she said in a signed statement provided to the police on 14 May 2003, at a time when she admitted her recollection was probably better. The other concerned what happened to her on awakening. A 53 AK v The State of Western Australia [2006] WASCA 245 at [5]. 54 Citing M v The Queen (1994) 181 CLR 487 at 494; [1994] HCA 63. 55 Criminal Appeals Act, s 30(3)(a). conclusion that the appellant was the offender, not the other boy in the bed, would have to rest on the following propositions: That the complainant's testimony three and a half years after the incident that the appellant went to bed next to her was to be preferred to her previous statement, made 15 months after the incident, that the appellant did not go to bed next to her; that in turn would have to rest on an explanation of why the testimony was to be preferred. That the appellant and R did not change places in the night. That the sexual interest shown by the appellant in the complainant in the events in 2003 underlying the fourth and fifth charges, the uncharged act of sexual intercourse, and other sexual incidents made it likely that he had the same interest in February 2002. Reliance was placed by Pullin JA56, but not by the prosecution in this Court, on the proposition that the only other possible offender, R, had never shown any sexual interest in the complainant. It is true that there was no evidence that R had shown any sexual interest in the complainant, either before or after the 2002 incident. But this does not establish that he had none, and it was for the prosecution to prove that he had none if that circumstance were to be relied on. In relation to proposition (a), the complainant was closely cross-examined, and the trial judge formed a generally favourable view of her credibility and reliability. She had opportunities to consider the detail of her evidence carefully in the period before trial, and during that cross-examination, which entitled the trial judge to accept her testimony over her previous inconsistent statement. In relation to proposition (b), there was no evidence that the appellant and R had changed places. Any change would have been likely to disturb the other two occupants of the bed, which in turn might have attracted the attention of the complainant's aunt or sister in the next room. The only relevant witness other than the complainant, her sister, said she was a heavy sleeper and slept through the night. In relation to proposition (c), it is questionable whether the evidence of the appellant on the fourth and fifth charges was cross-admissible on the first three 56 AK v The State of Western Australia [2006] WASCA 245 at [29]. charges without satisfying s 31A of the Evidence Act 1906 (WA)57. So far as the transcript shows, there was no objection to its cross-admissibility and no contention that it was inadmissible was advanced in this Court. It may therefore be taken to be admissible. Defence counsel suggested to the complainant that no intercourse took place on the occasion the subject of the fourth charge and that no indecent touching took place on the occasion the subject of the fifth charge. But there was no evidence contradicting that of the complainant. In addition, there was a concession by the defence that the appellant had intercourse with the complainant at her father's house on an occasion not the subject of any charge. The defence made no objection to the evidence and indeed elicited it by means of a leading question. Defence counsel put to the complainant that it was consensual, which she denied. But the admitted fact of sexual intercourse in 2003 supports at least a motive to commit acts of indecent dealing in 2002, and possibly a disposition to do so. The same is true, to a lesser degree, of the complainant's very vague evidence that she had been touched by the appellant in a manner which she said was less serious than the conduct underlying the first three charges. The transcript of the complainant's evidence reveals that she was vague about dates and other details, that she did not make speedy complaint, and that there was an inconsistency between her previous statement to the police and her testimony. A skilful defence cross-examination elicited, or at least plausibly suggested, various motives for lying on her part. But the trial judge said in argument that the complainant was "quite a credible witness" – "quite an impressive young lady" as a witness, who endeavoured to "visualise" past events so that she "brought the situation back into her mind" and employed "considerable care" in giving her testimony. He accepted that the conduct of which the complainant complained took place not only in relation to counts 1-3, but also counts 4 and 5. It is necessary to make "full allowance for the 57 Section 31A(2) provides: "(2) Propensity evidence or relationship evidence is admissible in proceedings for an offence if the court considers – that the evidence would, either by itself or having regard to other evidence adduced or to be adduced, have significant probative value; and that the probative value of the evidence compared to the degree of risk of an unfair trial, is such that fair-minded people would think that the public interest in adducing all relevant evidence of guilt must have priority over the risk of an unfair trial." advantages enjoyed" by the trial judge58. Making that allowance, the "discrepancies" and "inadequacies" of the complainant's testimony do not suggest a significant possibility that the appellant was an innocent person who has been convicted. Accordingly, ground 3 fails. Ground 1: failure to state findings of fact relied on Questions of degree in relation to s 120(2). In many cases the question of whether there has been compliance with the duty imposed by s 120(2) of the Criminal Procedure Act will raise questions of degree. Those questions will arise where a trial judge has stated various principles of law but has failed to state another, although it has obviously been assumed. They may arise where a judge has stated that numerous facts have been found, but has omitted to state a particular finding of fact. In many cases the question of whether there has been compliance with s 120(2) will also raise difficulties of distinguishing between, on the one hand, a defective statement of legal principle, an unconvincing factual finding, an invalid inference or a questionable application of principle to fact and, on the other hand, a failure to state a principle of law, make a finding of fact or expose the "reasoning process linking"59 the principles of law to the findings of fact. Sometimes the statement of positive propositions coupled with the non-statement of others can satisfy s 120(2) because it amounts to a statement of the principles of law actually applied or the findings of fact actually relied on even though the omission reveals error in what was said; sometimes, on the other hand, the statement will not satisfy s 120(2). To record various legal principles which a judge said were applied may be to comply with s 120(2), but the process of recording them may reveal errors in their statement or application which disclose "a wrong decision on a question of law" within the meaning of s 30(3)(b) of the Criminal Appeals Act or a miscarriage of justice within the meaning of s 30(3)(c). And to record various findings of fact which a judge said were relied on may be to expose errors of reasoning which reveal that the verdict of guilty on which the conviction is based should be set aside because, having regard to the evidence misapplied by that judge, it is unreasonable or cannot be supported within the meaning of s 30(3)(a), or there was a miscarriage of justice within s 30(3)(c). Further, to make a statement of all relevant principles of law or of all relevant findings of fact but also to state some irrelevant ones may raise questions under s 30(3)(b) and (c) of the Criminal Appeals Act. 58 M v The Queen (1994) 181 CLR 487 at 494. 59 Fleming v The Queen (1998) 197 CLR 250 at 263 [28] per Gleeson CJ, McHugh, Gummow, Kirby and Callinan JJ; [1998] HCA 68. Substantial failure to comply with s 120(2). However, none of these problems arise here. It is common ground between the parties in the Court of Appeal and in this Court, and among the judges in the Court of Appeal, that the trial judge failed to comply with s 120(2) of the Criminal Procedure Act. The failure was almost as complete a failure as could be imagined, for apart from stating that the complainant was "generally a thoughtful and truthful witness", noting the absence of prompt complaint, recording his conclusion that the events she described took place, and recording that the appellant was responsible for them, he said nothing more about any findings of fact he relied on. The appellant submitted correctly that the obligation created by s 120(2) is not "satisfied merely by a bare statement of the principles of law that the judge has applied and the findings of fact that the judge has made. Rather, there must be exposed the reasoning process linking them and justifying the latter and, ultimately, the verdict."60 It is clear from the trial judge's interventions in argument that he was attracted towards a particular reasoning process; the problem is that he did not state it in his judgment. In the circumstances it is not necessary to elaborate on the various ways in which the trial judge might have fulfilled the s 120(2) obligation, beyond the following. Ordinarily it would be necessary for a trial judge to summarise the crucial arguments of the parties, to formulate the issues for decision, to resolve any issues of law61 and fact which needed to be determined before the verdict could be arrived at, in the course of that resolution to explain how competing arguments of the parties were to be dealt with and why 60 Fleming v The Queen (1998) 197 CLR 250 at 262-263 [28] per Gleeson CJ, McHugh, Gummow, Kirby and Callinan JJ. 61 The charges against the accused to which the present appeal relates were charges that he "indecently dealt" with the complainant contrary to s 321(4) of the Criminal Code (WA). Section 321(4) provides: "A person who indecently deals with a child is guilty of a crime and is liable to the punishment in subsection (8)." The trial judge did not state "the principles of law that he ... applied" in relation to s 321(4). This failure is of no significance. The defence took no point, and no point could be taken if the complainant's account of what happened to her in the relevant period of up to half an hour was accepted, that the incidents were accidental, and that the supposed offender did what was done momentarily in his sleep. Indeed the defence conceded in address that the complainant's evidence of what was done to her (as distinct from who did it) was likely to be accepted: she was "clear", was not "swayed" and "stuck" to her "story". Although defence counsel had suggested to the complainant that the events she complained of had not taken place, the defence did not specifically argue that the trial judge should make that finding: its position was that while if they took place, they were indecent, the appellant was not the person responsible for them. the resolution arrived at was arrived at, to apply the law found to the facts found, and to explain how the verdict followed. Here the trial judge did not isolate, in particular, the issue of whether the accused was the offender, did not record the arguments of the parties on that question, and did not record the analysis of the complainant's evidence which must have underlain his conclusion that the appellant was the offender. The statement that the "complainant was generally a thoughtful and truthful witness" did not carry out these functions, particularly because of the form of her evidence, which averred certainty of belief without testifying to any grounds for that belief and which in turn prevented the trial judge from finding any. If the statement were to be treated as complying with s 120(2), our law would have adopted a form of unilateral compurgation as a means of proof centuries after the demise of multilateral compurgation. The appellant correctly submitted that the trial judge's "reasons constituted a manifest and substantial (as opposed to trivial) departure from the statutory imperative". It is thus clear that, to use the language of s 30(3)(b) and (c) of the Criminal Appeals Act, there has been a wrong decision on a question of law by the judge and a miscarriage of justice. The point of ground 1 is to challenge the Court of Appeal's conclusion, after considering the evidence, that no substantial miscarriage of justice had occurred and that the proviso should be applied. Instances of where the proviso will not be applied. The Court of Appeal62 noted that in Weiss v The Queen this Court said that there may be cases where it would be proper to allow an appeal and order a new trial without applying the proviso. In that case this Court gave two categories of example. The first included cases "where there has been a significant denial of procedural fairness at trial"63. The second included cases where the "errors or miscarriages of justice occurring in the course of a criminal trial may amount to such a serious breach of the presuppositions of the trial as to deny the application of the common form criminal appeal provision with its proviso"64. The Court in Weiss v The Queen referred in the latter respect to Wilde v The Queen65, and in this case the Court of Appeal referred to the passages in that case in which Brennan, Dawson and 62 On this issue Pullin JA set out the reasoning of the majority: AK v The State of Western Australia [2006] WASCA 245 at [52]-[56]. Roberts-Smith JA concurred at [1]. Buss JA decided that the proviso should not be applied, but for reasons different from those urged by the appellant in relation to ground 1: at [85]. 63 (2005) 224 CLR 300 at 317 [45] per Gleeson CJ, Gummow, Kirby, Hayne, Callinan and Heydon JJ; [2005] HCA 81. 64 (2005) 224 CLR 300 at 317 [46] per Gleeson CJ, Gummow, Kirby, Hayne, 65 (1988) 164 CLR 365 at 373; [1988] HCA 6. Toohey JJ said that the proviso was not intended to apply "when the proceedings before the primary court have so far miscarried as hardly to be a trial at all" and that it does not apply "where an irregularity has occurred which is such a departure from the essential requirements of the law that it goes to the root of the proceedings", so that "the accused has not had a proper trial and ... there has been a substantial miscarriage of justice"66. The Court of Appeal held that the present case fell outside these criteria. It said that the irregularities in the trial judge's judgment "did not affect the evidence which was led"67. It also said68: "The irregularities which occurred were not in the conduct of the trial itself. The irregularities were in the articulation of the trial Judge's reasons for decision. The irregularities did not go to the root of the proceedings." In assessing these conclusions it is desirable to remember that the partial abandonment of trial by jury on charges triable by indictment in the circumstances set out in s 118 of the Criminal Procedure Act, with its correlative, the introduction of a right of prosecution appeal against acquittal conferred by s 24(2)(e)(ii) of the Criminal Appeals Act, was a radical departure from the tradition of centuries69. The importance of judicial reasons for decision. The duty of judges to give reasons for their decisions after trials and in important interlocutory proceedings is well-established. The objectives underlying that duty have been summarised as follows70: "First, the existence of an obligation to give reasons promotes good decision making. As a general rule, people who know that their decisions are open to scrutiny, and who are obliged to explain them, are more likely to make reasonable decisions. Second, the general acceptability of 66 AK v The State of Western Australia [2006] WASCA 245 at [55], referring to Wilde v The Queen (1988) 164 CLR 365 at 373. 67 AK v The State of Western Australia [2006] WASCA 245 at [52]. 68 AK v The State of Western Australia [2006] WASCA 245 at [56]. 69 Below some of the arguments for and against trial by jury are referred to. The discussion is not intended to criticise the legislature's decision to introduce ss 118-120: the merits of the decision are a matter for the legislature and the public, not the courts. The discussion is simply intended to reveal the novelty and significance of the change. 70 Gleeson, "Judicial Accountability", (1995) 2 The Judicial Review 117 at 122. judicial decisions is promoted by the obligation to explain them. Third, it is consistent with the idea of democratic institutional responsibility to the public that those who are entrusted with the power to make decisions, affecting the lives and property of their fellow citizens, should be required to give, in public, an account of the reasoning by which they came to those decisions." But the duty to give reasons has even greater significance where it is created by a provision like s 120(2), enacted as part of a particular statutory scheme of a novel and radical character regulating the substitution of trial by judge alone for trial by jury. Advantages of jury trial. Lord Devlin described trial by jury as "the lamp that shows that freedom lives"71. He also said72: "Trial by jury means a compounding of the legal mind with the lay. The prescription for this compound has been one of the greatest achievements of the common law." Trial by jury was so greatly valued by the framers of the United States Constitution that it was guaranteed by the Sixth Amendment 73. Section 80 of our own Constitution provides that trials on indictment of any offence against any law of the Commonwealth shall be by jury. Not everyone admires jury trial74. It may certainly be accepted that there are "irrational" aspects of trial by jury in criminal cases. The selection of 12 as the number of jurors has never been satisfactorily explained. Jurors are expected 71 Lord Devlin, Trial by Jury, (rev ed) (1966) at 164. This work collects the Hamlyn Lectures delivered by the author in 1956. Despite updating in 1966, it is significantly out of date, and not sharply focused on the Australian position. To some extent it reflects excessively Miss Hamlyn's desire that lecturers cause "the Common People of the United Kingdom [to] realise the privileges which in law and custom they enjoy in comparison with other European Peoples" (at vi). However, it remains full of extremely thoughtful points reflecting the common professional understanding of jury trial. 72 Lord Devlin, Trial by Jury, (rev ed) (1966) at 120. 73 "In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed". See also Art III, s 2(3). 74 See the opinions collected by Baldwin and McConville, Jury Trials, (1979) at 2 and 4. See also Williams, The Proof of Guilt, 3rd (1963), Ch 10. to understand, remember – on occasions for months – and weigh evidence, which is sometimes not given clearly or is complicated in character, often without ever having done this before. They are expected to grasp and apply sometimes complex propositions of law, almost always without any prior experience of or training in this activity. Many jurors were and are "unaccustomed to severe intellectual exercise or to protracted thought"75. The development of jury trial has been "irrational" in the sense that the jury began, against the background of irrational modes of trial like trial by ordeal and trial by battle, as a body selected for the very reason that the jurors, men of the neighbourhood, had knowledge of the facts relating to the dispute. In this respect it was superior to those rival modes of trial shortly to be forbidden by the Fourth Lateran Council in 1215. But now persons who have any prior knowledge of the dispute or the protagonists in it are likely to be excluded from the jury. The jury is now a body which knows nothing, beyond the teachings of common experience and what may be judicially noticed, except what witnesses tell it or supply to it. It began in order to serve one function; it came to serve another; and its role in performing that latter function has been deliberately preserved. Despite these "irrational" characteristics, and this wholesale revolution in function, the jury has been thought to possess many qualities which have favoured its long survival in serious criminal cases. Lord Devlin, for example, saw five advantages in trial by jury. First, Lord Devlin thought juries were superior to judges in assessing defence points: "the hope of the defence very often lies in impalpabilities – the 75 Second Report of HM Commissioners for Inquiring into the Process, Practice, and System of Pleading in the Superior Courts of Common Law, Parliamentary Papers 1853 [1626] vol 40 at 6. The complete passage reads: "[W]e are not at all blind to the fact that in many instances juries are not so constituted as to ensure such an average amount of intelligence as might be desired. A jury of London or Liverpool merchants may be, as we believe them to be, an excellent tribunal to try a commercial cause, or a jury of country gentlemen to try a question relating to a watercourse or the boundaries of an estate; but it must be admitted that in the agricultural districts the common juries are sometimes composed of a class of persons whose intelligence by no means qualifies them for the due discharge of judicial functions. Such persons, unaccustomed to severe intellectual exercise or to protracted thought, and used to an active life and out-door employment, when shut up for hours in a jury-box, bewildered by law terms, by conflicting evidence, and the disputations of contending advocates, will appeal to their prejudices, sometimes pronounce verdicts which bring the institution of juries into disrepute." willingness to make allowances for muddle-headedness, illogicalities and unreasonableness – impalpabilities that are less appealing to the legal mind than to the lay"76. He said77: "[I]t is an essential part of the system that the law should recognise that there are cases in which such factors should be dominating." Secondly, Lord Devlin also saw juries as being superior to judges in assessing credibility78: "[T]he jury is the best instrument for deciding upon the credibility or reliability of a witness and so for determining the primary facts. Whether a person is telling the truth, when it has to be judged, as so often it has, simply from the demeanour of the witness and his manner of telling it, is a matter about which it is easy for a single mind to be fallible. The impression that a witness makes depends upon reception as well as transmission and may be affected by the idiosyncrasies of the receiving mind; the impression made upon a mind of twelve is more reliable. Moreover, the judge, who naturally by his training regards so much as simple that to the ordinary man may be difficult, may fail to make enough allowance for the behaviour of the stupid. The jury hear the witness as one who is as ignorant as they are of lawyers' ways of thought; that is the great advantage to a man of judgment by his peers." Lord Devlin also saw a third advantage in trial by jury79: "[M]inisters of justice have to serve two mistresses – the law and the aequum et bonum or the equity of the case. Their constant endeavour is to please both. That is why the just decision fluctuates ... between two points. In most systems the just decision is tied pretty closely to the law; the law may be made as flexible as possible, but the justice of the case cannot go beyond the furthest point to which the law can be stretched. Trial by jury is a unique institution, devised deliberately or accidentally – that is, its origin is accidental and its retention deliberate – to enable justice to go beyond that point." He considered that trial by jury had a "unique merit" in "that it allows a decision near to the aequum et bonum to be given without injuring the fabric of the law, 76 Lord Devlin, Trial by Jury, (rev ed) (1966) at 122. 77 Lord Devlin, Trial by Jury, (rev ed) (1966) at 123. 78 Lord Devlin, Trial by Jury, (rev ed) (1966) at 140. See also at 149. 79 Lord Devlin, Trial by Jury, (rev ed) (1966) at 154. for the verdict of a jury can make no impact on the law"80. Thus Lord Devlin saw the jury as being for some purposes "the best judicial instrument"81. A clear illustration of this role of the jury is seen when the jury decides whether the facts it finds answer certain legal criteria. That phenomenon is recognised by s 118(6) of the Criminal Procedure Act82, for the court may refuse to order trial by judge alone "if it considers the trial will involve a factual issue that requires the application of objective community standards such as an issue of reasonableness, negligence, indecency, obscenity or dangerousness". Other examples of factual issues requiring the application of "objective community standards" include whether behaviour was "threatening, abusive or insulting"83; whether conduct was "dishonest", a matter to be decided by the jury "according to the ordinary standards of reasonable and honest people"84; whether an assault is "indecent"85; and whether an accused person had a particular intention86. Lord Devlin saw a fourth advantage of jury trial which was "of great importance in the constitution. The ... existence of trial by jury helps to ensure the independence and quality of the judges."87 A fifth advantage detected by Lord Devlin was88: "[T]rial by jury ... gives protection against laws which the ordinary man may regard as harsh and oppressive. I do not mean by that no more than that it is a protection against tyranny. It is that: but it is also an insurance 80 Lord Devlin, Trial by Jury, (rev ed) (1966) at 157. 81 Lord Devlin, Trial by Jury, (rev ed) (1966) at 158. 82 See above at [88]. 83 Brutus v Cozens [1973] AC 854 at 861-862 per Lord Reid, 865-866 per Viscount Dilhorne, 866-867 per Lord Kilbrandon. 84 R v Ghosh [1982] QB 1053 at 1064 per Lord Lane CJ, Lloyd and Eastham JJ. 85 R v Court [1989] AC 28 at 34. 86 Buxton, "Some Simple Thoughts on Intention", [1988] Criminal Law Review 484 at 495: "[R]ecourse to shared values and assumptions about the implications of actions and the circumstances in which those actions occur may be a safer guide to culpability than analytical deductions from a generalised verbal definition". 87 Lord Devlin, Trial by Jury, (rev ed) (1966) at 158-159. 88 Lord Devlin, Trial by Jury, (rev ed) (1966) at 160. that the criminal law will conform to the ordinary man's idea of what is fair and just. If it does not, the jury will not be a party to its enforcement. They have in the past used their power of acquittal to defeat the full operation of laws which they thought to be too hard." In this respect, an accused person who is tried by judge alone is in a very different position from one tried by jury. A jury may have no right to acquit in the face of evidence, but, unlike a judge sitting alone, it has a power to do so, and a power which it is impossible to control on appeal because of traditional limitations on the capacity of the prosecution to appeal from acquittals89. In R v Shipley, Lord Mansfield CJ said90: "It is the duty of the Judge, in all cases of general justice, to tell the jury how to do right, though they have it in their power to do wrong, which is a matter entirely between God and their own consciences." As Lord Goddard CJ told the House of Lords in 1955, "no one has yet been able to find a way of depriving a British jury of its privilege of returning a perverse verdict"91. A judge cannot tell a jury to convict, for that would be to make the judge "decide the case and not the jury, which is not the common law"92. The Criminal Procedure Act has gone a step further from the common law by making 89 Pratt CJ stated the common law rule: "[I]t was never yet known, that a verdict was set aside by which the defendant was acquitted in any case whatsoever upon a criminal prosecution": R v Jones (1724) 8 Mod 201 at 208 [88 ER 146 at 149]. Where criminal charges are tried by jury, there is usually no general provision for any right to appeal from an acquittal. In Western Australia, before ss 118-120 of the Criminal Procedure Act were introduced, the only courses open to the prosecution after an acquittal were limited rights of appeal under s 688(2)(b) and (ba) of the Criminal Code – the right to appeal against a directed verdict of acquittal, to appeal against acquittal by a judge sitting alone on any ground of appeal involving a question of law alone or to appeal against acquittal by a judge alone on any other ground if leave was granted. These provisions were repealed by the Criminal Procedure and Appeals (Consequential and Other Provisions) Act 2004 (WA) with effect from 2005 when s 24(2)(e)(ii) of the Criminal Appeals Act, giving the prosecution a capacity to appeal against acquittals by a judge sitting alone, was introduced. 90 (1784) 4 Doug 73 at 170 [99 ER 774 at 824]. At 178 [828], Ashurst J admitted the jury's power, but denied their right, so to act. 91 191 HL Deb 85, 15 February 1955. 92 Woolmington v Director of Public Prosecutions [1935] AC 462 at 480 per the judge decide the case without any jury being present at all. The fact-finding procedures of juries thus can be marked by a kind of benign irrationality, for it is open to juries to acquit in the face of very strong evidence merely because they dislike some aspect of the law being enforced, or the behaviour of the police, or the testimony of prosecution witnesses or the conduct of the judge. A judge sitting alone, however, is expected to conform in all respects with rational criteria – the criteria commanded by applicable rules of law, and the criteria imposed by the "logical faculty"93 – in assessing the credibility of witnesses, in weighing the probabilities of particular events having happened and in drawing inferences from primary facts. To depart from a system centred on lay fact-finding which many think has the virtues ascribed to it by Lord Devlin is to take a step which calls for close scrutiny of the safeguards the legislature has provided. One of these is s 120(2). Judges, juries and the duty to give reasons. In civil jury cases, and non- jury criminal cases, it is customary for judges to give reasons for their final judgments and in considerable measure for their interlocutory judgments. It may have been thought impracticable for juries to do this, but for whatever reason, they do not do so and they are not permitted to do so. They may not be questioned about the reasons for their verdicts. Even the limited light which could be thrown on the jury's reasoning processes by a special verdict is blocked out by two factors. The first is that special verdicts are only to be requested in the most exceptional circumstances94. The second is that even if a special verdict is requested, the jury can insist on its right to deliver a general verdict only95. Indeed so strict was the practice of jury silence that at common law silence must be preserved after verdict about what discussions took place in the jury room, to the extent that evidence will not be received about those discussions96. Because the jury gives no reasons and because it is difficult to appeal against a jury conviction on purely factual grounds, the jury has very great 93 Thayer, A Preliminary Treatise on Evidence at the Common Law, (1898) at 314 94 R v Bourne (1952) 36 Cr App R 125. 95 Blackstone, Commentaries on the Laws of England, (1966) vol 3 at 377-378; The Mayor and Burgesses of Devizes v Clark (1835) 3 Ad & El 506 [111 ER 506]; R v Jameson (1896) 12 TLR 551 at 593. 96 Ellis v Deheer [1922] 2 KB 113 at 117-118; R v Gough [1993] AC 646 at 659; Roylance v General Medical Council (No 2) [2000] 1 AC 311 at 324; R v Mirza [2004] 1 AC 1118 at 1156 [95]; R v Smith [2005] 1 WLR 704 at 712-713 [16]; [2005] 2 All ER 29 at 38-39. independence in relation to the facts. It is true that even the most neutral and self-effacing of judges will have much influence over how the jury proceeds by his or her presentation of the parties' cases, selection of the evidence to be referred to, marshalling of the factual material, and identification of the key questions. It is also true that skilful judges can exercise considerable influence over how juries approach factual questions – just as unskilful ones, by conveying a perception of bias or unfairness, can involuntarily exercise considerable negative influence by causing juries to react strongly against any attempted influence. It is further true that to a limited extent the trial judge can take factual issues from the jury – by ruling at the end of the prosecution case that there is no evidence on which a jury could lawfully convict97; or by taking the exceptional course of inviting the jury, then or at any later time, to stop the trial if the evidence seems to them to furnish an unsafe foundation for a conviction98. But in most respects the jury has much autonomy in its decision-making – its finding of the facts and application to them of the law. Consequences of differences between judge and jury. The difference between jury trial presided over by a judge and trial by judge alone has significant consequences. Trial by jury is trial by a tribunal which "consists of a comparatively large body of men who have to do justice in only a few cases once or twice in their lives, to whom the law means something but not everything, who are anonymous and who give their decision in a word and without a reason"99. Trial by judge alone is trial by a tribunal consisting of one person who is not randomly selected from society; who has to do justice in hundreds or thousands of cases heard on most working days of a large part of his or her life; to whom, while that role is being carried out, the law means almost everything; who is well-known to the profession and sometimes to parts of the wider public, and who does not return after the trial to the anonymity from whence jurors came; who, by force of legal obligation and professional custom, gives reasons, sometimes very elaborate ones, for every significant decision; and who is accustomed to organise his or her approach to the entire judicial task by reference to that necessity. Where trial is by jury, the judge may have vast experience, at the Bar and on the bench, of trials relating to the type of conduct alleged. Jurors will often have none, and at most very little. The vast experience which a judge sitting alone may have of the weaknesses of human nature, and the repetitive conduct they engender, can breed a perception that the judge may fail to attend closely to the details of a particular case. The perception is not so much that the 97 May v O'Sullivan (1955) 92 CLR 654; [1955] HCA 38. 98 Glass, "The Insufficiency of Evidence to Raise a Case to Answer", (1981) 55 Australian Law Journal 842 at 845. 99 Lord Devlin, Trial by Jury, (rev ed) (1966) at 154. judge may assume that the police always get the right man100, but that once the prosecution has tendered enough evidence to make out a case to answer, the possible answers to that case which may be derived from the prosecution evidence and any evidence which the defence calls are not attended to sufficiently closely, because the judge has rejected those explanations in so many earlier cases. The perception is likely to be that when it comes to criminal defences, judges feel that they have heard it all before – the thing that hath been is that which shall be, and that which hath been done is that which shall be done, and there is no new thing under the sun. The perception may be that experienced judges tend to assume that the accused on trial probably behaved in the same way on the occasion to which the charge relates as innumerable guilty predecessors in the dock. Where trial is by jury, these perceptions do not matter: for factual findings are for the jury alone, the judge's role, while not limited to giving directions of law, centre on that task, and the correctness of those directions is minutely and jealously scrutinised both by the counsel who conduct criminal appeals and the courts which hear them. Where trial is by judge alone, s 120(2) can be seen as a mechanism for nullifying the dangers recognised by those perceptions. Safeguards for the accused. There are two principal safeguards for the accused in a criminal trial. One is the criminal burden and standard of proof. The other is the requirement either that the verdict be unanimous (as in Queensland101 and the Australian Capital Territory102) or that it be the result of a very substantial majority (as in other jurisdictions103). 100 Darling, Scintillae Juris, 6th ed (1914) at 33-34 said: "The truth is, that, although the law pays a prisoner the compliment of supposing him to be wrongly accused, it, nevertheless, knows very well that the probabilities are in favour of the prosecutor's accusation being well founded ... No defendant [in civil proceedings] is brought up through a hole in the floor; he is not surrounded by a barrier, nor guarded by a keeper of thieves; he is not made to stand up alone while his actions are being judged; and his latest address is not presumably the gaol of his county." 101 Jury Act 1995 (Qd), s 59. 102 Juries Act 1967 (ACT), s 38. 103 Section 114 of the Criminal Procedure Act provides: "(1) Subject to this section, the verdict of a jury must be the unanimous verdict of its members. (Footnote continues on next page) "One is enough". It is common in our society for decisions made by bare majority to prevail – decisions by electors, legislators, cabinets, committees and human groupings of all kinds – public, commercial or domestic, secular or ecclesiastical, and indeed judicial and quasi-judicial tribunals, particularly appellate courts. The common law, however, required jury unanimity, and the inroads made on this by legislation extend only so far as permitting no more than two dissenters. Given that the robust pressures for agreement employed in former times have lost favour, given that not every jury will have dominant spirits, capable of readily persuading others to their view, and remembering the constraints which exist on judicial exhortations to unanimity or majority104, If a jury trying a charge has retired to consider its verdict and, having deliberated for at least 3 hours, has not arrived at a unanimous verdict, the decision of 10 or more of the jurors shall be taken as the verdict on the charge. If a jury trying a charge has retired to consider its verdict and, having deliberated for at least 3 hours, 10 or more of the jurors have not agreed on a verdict, the judge may discharge the jury from giving its verdict on the charge. (4) Subsections (2) and (3) do not apply to a charge of wilful murder or murder. (5) Subsections (2) and (3) do not prevent a judge from requiring a jury to deliberate for more than 3 hours." A similar provision was first introduced in 1960. See also Jury Act 1977 (NSW), s 55F (first introduced in 2006); Juries Act 2000 (Vic), s 46 (first introduced in 1994); Juries Act 2003 (Tas), s 43 (first introduced in 1936); Juries Act 1927 (SA), s 57 (first introduced in 1928); Criminal Code Act (NT), s 368. These provisions are inconsistent with s 80 of the Constitution in their applications to trials for Commonwealth offences: Cheatle v The Queen (1993) 177 CLR 541 at 552-554; [1993] HCA 44. There Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ saw two fundamental differences between unanimous verdicts and majority verdicts. The first was that unanimous verdicts better secure the goal of ensuring that convictions are only arrived at when there is no reasonable doubt. The second was that while majority verdicts permit the overriding of dissent, the need for unanimity promotes deliberation and provides some insurance that the opinions of each of the jurors would be heard and discussed, reducing the danger of hasty and unjust verdicts. The fact remains that the requirement that at least 10 jurors agree in a verdict is a significant hurdle for the prosecution and a strong safeguard for the accused. See also Juries Act 1974 (UK), s 17 (first introduced in 104 See Black v The Queen (1993) 179 CLR 44; [1993] HCA 71. unanimity, or a very high majority in favour of guilt, can be hard to achieve. It cannot be easy to obtain unanimity or a high majority amongst quite a large number of decision-makers reflecting the diversity of the sections of the community they belong to, the diversity of human personality and the diversity of human experience. The process must tend to generate its own discipline – cause a careful scrutiny of the evidence, a dilution and sloughing away of individual prejudices, a pooling and sharing of human experience, a solemnity of decision-making. The criminal burden of proof and the criminal standard of proof survive abolition of jury trial. The need for jury unanimity or near unanimity does not. The discipline that need generates cannot be compensated for directly. But by an indirect route the duty to give reasons can operate to safeguard the interests of the accused and the public interest generally. That is because a move to trial by judge alone causes appeals to operate in a radically different way. It is much easier for an appellate court to detect appellable error where reasons for the verdict at trial must be provided than it is when the appellate court is limited only to the record of the proceedings before a jury. When a trial judge directs the jury on the law, it will be clear what was said. If nothing is said, or something erroneous is said, about decisive questions of law, an appeal will lie. Those possibilities are complete checks against judicial error in propounding the law. The substitution of judge for jury as trier of fact would leave open the risk of judicial errors as to the law unless there were a requirement that the judge state the principles of law being applied, and s 120(2) creates this requirement. Just as a jury trial without a judicial summing up would not really be a trial, a trial by judge alone without a s 120(2) statement of the applicable legal principles would not really be a trial. In this respect s 120(2) preserves an aspect of jury trial; it does not reject it. But s 120(2) goes beyond requiring a statement of legal principle; it requires that the findings of fact relied on be stated. That requirement has two consequences. It permits close appellate supervision of the trial judge's factual reasoning. And it creates the need for the trial judge to submit to a demanding discipline. Interaction between trial judges and appellate courts. The years in which trial by jury in England began its movement towards almost total disappearance in civil cases – the years 1854 to 1883105 – marked a period in the course of 105 In 1854 the Common Law Procedure Act, s 1, provided for trial by judge alone with the consent of the parties, and s 3 gave judges the power to refer matters of account to referees. In 1873 the Judicature Act, s 57, extended the latter power to a "matter requiring any prolonged examination of documents or accounts, or any scientific or local investigation". In 1883 O 36 of the Rules of the Supreme Court made trial by judge alone the rule, in the sense that jury trial had to be specially (Footnote continues on next page) which the Court of Appeal was created, in 1873, and developed106. The result of that process led Lord Devlin to the following conclusions107: "Trial by a judge alone might with some exaggeration be described as trial by a judge and three lords justices. It is potentially a combined operation. Trial by jury combines the work of judge and jury; in a simple case it will be mainly the work of the jury and in a complicated case the judge will contribute a great deal. Trial by judge alone becomes a combined operation only in a minority of cases. But I called it potentially that because the delivery of a reasoned judgment is an essential part of the process and enables the defeated party to make up his mind whether he wants to proceed to the second part of the operation. If he does, the judgment of fact that emerges at the end is the joint work ... of the trial judge and the appellate judges in much the same way as the verdict is the joint work of judge and jury." By "combined operation" Lord Devlin meant the following108: "In the Court of Appeal the work of the judge below is not discarded. His finding of the primary facts is the raw material on which the court works. Because he has had the advantage of seeing the witnesses, he is accepted as the better tribunal for the determination of the primary facts; but the appellate court has a complementary advantage, which makes it the better tribunal – at any rate in a case of any length or complexity – for the determination of the secondary evidence, that is, the drawing of inferences. Throughout the trial the case is alive and kicking: when it gets to the Court of Appeal it is dead. Issues change and develop as the trial proceeds and as witnesses tell their different, and sometimes unexpected, stories; points that left the starting-post apparent winners fall out of the race and dark horses take up the running. Even a short case can be full of surprises. It is not always easy for a judge, who has been in the thick of the thing from the beginning, to select at the end of it the best viewpoint for the case as a whole, especially if he follows the traditional practice of delivering whenever possible an unreserved and extempore judgment simply on the basis of his own note. In the Court of Appeal the requested, in all cases save those of libel, slander, malicious prosecution, false imprisonment, seduction and breach of promise of marriage, where the right to trial by jury survived. 106 Judicature Act 1873, s 4. 107 Lord Devlin, Trial by Jury, (rev ed) (1966) at 134-135. 108 Lord Devlin, Trial by Jury, (rev ed) (1966) at 138-139. material is fixed. Counsel on both sides, having now, as they had not at the trial, the advantage of knowing what evidence the judge has believed and what rejected, can sort out the material at leisure, disregarding the bad points and making the most of the good ones. Little bits of evidence that passed unnoticed at the time are seen in the light of a new definition of issues to become greatly significant. Thus the Court of Appeal is much better equipped than the trial judge for the ascertainment of the secondary facts; the case is, as it were, laid out flat before them and three minds consult together on the right conclusions to be drawn. The joint work to which I referred is the work of the trial judge in determining the primary facts combined with the work of the appellate judges in determining the secondary facts." The move to trial by judge alone in criminal cases marks the abandonment of a model resting on joint work between judge and jury. It adopts a model resting on joint work between trial judge and appellate court. This move has similar problems to those created in earlier times by the move to trial by judge alone in civil cases. Underlying s 120(2) is a perception of the extreme importance, from this point of view, of the trial judge's reasons for judgment. For plainly the combined operation which takes place between a judge trying a case without a jury and an appellate court hearing an appeal from that judge's orders will not work unless the trial judge has supplied detailed reasons for judgment. In R v Keyte109, Doyle CJ explained why. He accepted that reasons were not necessary in order to determine whether it was open to the judge, "on the available evidence", to be satisfied of guilt beyond reasonable doubt – ie to determine the issues arising under the equivalent of s 30(3)(a) of the Criminal Appeals Act. That is because the appellate court could examine the evidence for itself. But he identified, non-exhaustively, four respects in which the "scrutiny of a trial" by an appellate court would be "substantially contracted" if a failure to give reasons meant that other grounds of appeal could not be examined by an appellate court110. One was that the appellate court111: "will have no ability to determine whether the judge has correctly applied the relevant rules of law. Absent reasons from the trial judge, the ability to correct a verdict affected by 'a wrong decision on any question of law' will be confined to errors made in the course of the trial itself, and to situations in which it can be said that, as a matter of law, it was not open to the judge to convict. Cases in the latter category would be relatively rare." 109 (2000) 78 SASR 68 at 76 [39]. 110 (2000) 78 SASR 68 at 76 [38]. 111 (2000) 78 SASR 68 at 76 [38]. Another was that112: "in those cases in which the correct use of the evidence is affected by rules of law, there will be no means of determining whether the judge identified and correctly applied the relevant rules". A third, of particular relevance in the present appeal, was that113: "in cases in which the circumstances call for particular care, such as cases involving identification evidence, there will be no means of knowing whether and how the judge dealt with the matter requiring particular care". A fourth was that the appellate court114: "would be deprived of the ability to decide whether there has been a miscarriage of justice as a result of the manner in which the conclusion of guilt was reached". In short, the cooperative enterprise or combined operation between a judge sitting without a jury and a court of criminal appeal, analogous to that which Lord Devlin saw as taking place between a judge sitting without a jury in civil cases and a court of appeal, cannot take place if the judge sitting alone has given no reasons. The discipline of giving reasons. Section 120(2) of the Criminal Procedure Act does not serve only the purpose of enabling the accused to know why there was a conviction, or the prosecution to know why there was an acquittal. The facility it offers for close appellate scrutiny of the trial judge means that it creates an essential discipline. The process of having to state judicial reasoning in terms sufficiently clear, exact and convincing to pass muster in the eyes of an appellate court listening to the sometimes hypercritical submissions of counsel entails a need to be very precise in working that reasoning out. The discipline stems from the fact that the process of stating reasoning often reveals its fallacies: in the course of composing reasons for judgment directed to supporting a conclusion which seemed clear, judges often find that the opinion "won't write", and that a different conclusion develops. There is a legislative assumption that compliance with that discipline is not only more likely to produce justice according to law, but is a necessary precondition for that outcome. The abolition of jury trial entails removal of the safeguard to 112 (2000) 78 SASR 68 at 76 [38]. 113 (2000) 78 SASR 68 at 76 [38]. 114 (2000) 78 SASR 68 at 76 [38]. be found in the peculiar discipline of jury trial115. The new safeguard, to be found in the discipline of having to give reasons, is a vital technique for ensuring accurate fact finding, correct inferential reasoning and sound application of the law to the facts. Section 120(2), construed against the background described above, requires strict compliance with the duty to state the principles of law applied and the findings of fact relied on is to be a fundamental part of the new regime of trial without jury. The safeguards which accompany the adoption of trial by judge alone for indictable offences must be seen as vital elements of the statutory scheme which effected that change. But those safeguards are not limited to those stated in ss 118 and 119(1) and (3). A fundamental safeguard is also to be found in s 120(2). As the Court said in Fleming v The Queen116 of the New South Wales equivalent to ss 119(3) and 120(2), a legislative concern is evinced "that, in the operation of the new regime ... whereby trial by jury is replaced in certain circumstances by trial by judge sitting alone, justice must not only be done but also be seen to be done". Non-compliance with s 120(2), at least in non-trivial respects, is a departure from an essential legal requirement going to the root of the proceedings and from a fundamental assumption on which this hitherto unusual form of criminal justice in serious cases rests. The s 120(2) duty in the present case. Just as the importance of s 120(2) is very great, so the extent of non-compliance with it in this case was extreme. The non-compliances cannot be described as constituting mere "irregularities"117. It is not material that those non-compliances "did not affect the evidence which was led"118. Nor is it correct to see the non-compliances as not having been "in the conduct of the trial itself"119, any more than the addresses of counsel or the summing up in a trial by jury can be said not to be in the conduct of the trial itself. The duty to comply with s 120(2) is an essential means of securing the fair and just conduct of the trial, and is also an essential means of revealing any deficiencies in the trial as a whole. 115 See above at [102]. 116 (1998) 197 CLR 250 at 260 [22] per Gleeson CJ, McHugh, Gummow, Kirby and 117 As it was called in the Court of Appeal: AK v The State of Western Australia [2006] WASCA 245 at [52]. 118 See AK v The State of Western Australia [2006] WASCA 245 at [52]. 119 See AK v The State of Western Australia [2006] WASCA 245 at [56]. In Fleming v The Queen120 it was said that there may be cases where the failure to satisfy the requirements of the then New South Wales equivalent to s 119(3) "involves errors that are so trivial that the Court of Criminal Appeal may conclude that there has been a trial according to law, notwithstanding that failure". So too a failure to satisfy the requirements of s 120(2) may involve omissions to include principles of law or findings of fact which are so trivial that it is open to conclude that there has been a trial according to law notwithstanding those omissions. But in Fleming v The Queen, given the importance of the subject-matter of the warning about the need to assess the relevant witness's reliability in the light of her age, emotional instability and infatuation with the appellant in that case, the miscarriage of justice was a substantial one, and the proviso was not applied. Here too, given the importance of the requirement of a statement of findings in a factually unusual and puzzling case, and the extent of the breach of that requirement, the proviso should not be applied. The error was one which was a sufficiently "serious breach of the presuppositions of the trial"121 to go to "the root of the proceedings"122. The trial judge's observations in argument. This conclusion should not be drawn, according to the prosecution argument in this Court, because of the trial judge's observations in argument – made in a trial which lasted a day and a half, much of it being taken up by cross-examination of the complainant. This is one of many areas in which there is a fundamental difference between the significance of what judges say in argument and the significance of what they say in actually deciding cases. What the trial judge said in argument, taken with the record of the oral evidence, certainly reveals that there was no flaw in the conduct of the trial until the moment when the trial judge came to explain why the appellate was guilty on the first three charges. But the mere fact that the trial judge's interventions in argument reveal that he was attending to the issues in a careful and dedicated way cannot fill the gaps in the reasons for judgment. The process of testing propositions and floating ideas in argument is a radically different process from stating the findings of fact relied on, for the latter fulfils functions and serves purposes which the former does not. The former process does not form part of the judgment; statements made during it are not findings. The duty to make statements in the judge's reasons for judgment is not, contrary to what the prosecution called it, merely "technical". Section 120(2) requires the latter process to be complied with at one particular time and in a formal way. Its requirements cannot be met by things done at some other time and in some other 120 (1998) 197 CLR 250 at 265 [39] per Gleeson CJ, McHugh, Gummow, Kirby and 121 Weiss v The Queen (2005) 224 CLR 300 at 317 [46]. 122 Wilde v The Queen (1988) 164 CLR 365 at 373. way123. Nor, contrary to what the prosecution submitted, did the judge's remarks in argument indicate that he was conclusively relying on them as part of his reasoning process. In Fleming v The Queen the Court said, speaking of principles of law relevant to a particular trial124: "Unless the judgment shows expressly or by implication that the principle was applied, it should be taken that the principle was not applied, rather than applied but not recorded." The same is true of findings of fact. Significant denial of procedural fairness? The appellant also argued that the proviso could not be employed where the relevant error of law or irregularity was "a significant denial of procedural fairness"125 in that it substantially frustrated the exercise of a convicted person's appellate rights. There is no doubt that a miscarriage of justice can take place where its consequence is that "it is impossible for an appellate court to decide whether a conviction is just"126. From that point of view the presence of a miscarriage of justice is much starker, because the absence of the factual findings in relation to the reasoning which led to the verdict made it hard to assess whether those aspects of the evidence underlying that reasoning rendered the conviction just. However, it is not necessary to decide whether the proposition on which the appellant relied – that the proviso could never be employed where the appellable error substantially frustrated the exercise of a convicted person's appellable rights – is correct. The error in this case had that consequence, but that is simply a reflection of the seriousness of the failure to comply with s 120(2) and the importance of doing Ground 1: failure to give identification warning, contrary to s 119(3) The appellant submitted that the trial judge had failed to comply with s 119(3)(a) of the Criminal Procedure Act in not taking into account the 123 For an analogy, see Subramaniam v The Queen (2004) 79 ALJR 116 at 126 [44] per Gleeson CJ, McHugh, Kirby, Hayne and Callinan JJ; 211 ALR 1 at 14; [2004] HCA 51. 124 (1998) 197 CLR 250 at 263 [30] per Gleeson CJ, McHugh, Gummow, Kirby and 125 Weiss v The Queen (2005) 224 CLR 300 at 317 [45]. 126 Nudd v The Queen (2006) 80 ALJR 614 at 618 [7] per Gleeson CJ; 225 ALR 161 at 164; [2006] HCA 9. requirement that a jury be warned of the dangers of acting on identification evidence. In particular, it was said that the trial judge "failed to identify and give a warning required by law in relation to identification or recognition evidence". The language of ground 1 of the Notice of Appeal does not capture the point. The appellant attempted to bring it within the language of ground 1 by contending that the trial judge had "failed to identify any matter in the evidence which could have reasonably been regarded as undermining the reliability of the identification or recognition evidence", "failed to specify that he had regard for and acted upon an identification warning", and "failed to explain how, notwithstanding the warning, he was satisfied, beyond reasonable doubt, that the appellant was the offender". It is true that these failures existed, but if in fact the trial judge did not give himself an identification warning, they were not failures to comply with s 120(2), for his judgment could not then be said to fail to have included a principle of law which he applied. His failure was rather a failure to comply with s 119(3). Whether or not the submission of the appellant about the failure to give an identification warning can be fitted into ground 1, in view of the conclusion reached above in relation to s 120(2), it is not necessary finally to determine its correctness. However, there is much to be said for the view that the success of the appellant's argument in relation to the failure of the complainant to explain why and how she identified the appellant as the offender tends to prevent his s 119(3) argument from having a satisfactory foothold. The need for an identification warning normally arises in relation to visual identification. This was not a case of visual identification. The kind of warning commonly given would require substantial variation in the case of identification by touch, but despite Pullin JA's contrary opinion, this was not a case of identification by touch. Either it was a case of identification by some form of intuition or feeling, or it was a case of identification by circumstantial inference from the fact of where the children were positioned when they went to bed. If identification was of the former kind, the complainant's evidence was inadmissible, and the flaw in the trial judge's approach was at a point anterior for the need for an identification warning. If identification was of the latter kind, no identification warning was needed. Either way, no s 119(3) error was material. It is thus also unnecessary to consider whether, if there was a s 119(3) error, it was so serious as to exclude the possibility of applying the proviso. Ground 2: the proviso Since ground 1 has been made out, ground 2 need not be dealt with, for the point of ground 1 is that if the reasoning underlying it is sound, it is not permissible to engage in the process of examining the whole record in which the Court of Appeal engaged before applying the proviso, and the target of ground 2 was the details of that reasoning process. Orders In view of the appellant's success in relation to ground 1, the appeal should be allowed and a new trial ordered.
HIGH COURT OF AUSTRALIA AUSNET TRANSMISSION GROUP PTY LTD APPELLANT AND THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA RESPONDENT AusNet Transmission Group Pty Ltd v Federal Commissioner of Taxation [2015] HCA 25 5 August 2015 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation S H Steward QC with L A Hespe and K J Deards for the appellant (instructed by Deloitte Lawyers Pty Ltd) H M Symon QC with E F Wheelahan for the respondent (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS AusNet Transmission Group Pty Ltd v Federal Commissioner of Taxation Taxation – Income tax – Allowable deductions – Charges were imposed on holder of electricity transmission licence pursuant to State regulatory framework – Taxpayer purchased assets of electricity transmission business including electricity transmission licence – Taxpayer required to pay charges to State of Victoria under asset sale agreement – Whether payments of charges were outgoings "of capital, or of a capital nature" and therefore not tax deductible. Words and phrases – "capital", "capital account", "of a capital nature", "revenue account". Electricity Industry Act 1993 (Vic), ss 163A, 163AA. Income Tax Assessment Act 1997 (Cth), s 8-1(2)(a). FRENCH CJ, KIEFEL AND BELL JJ. Introduction In 1993, the State of Victoria embarked upon the privatisation of its publicly owned electricity supply industry. On 12 October 1997, a State-owned electricity transmission company, Power Net Victoria ("PNV"), which was incorporated under the Electricity Industry Act 1993 (Vic) ("the Electricity Act"), sold its assets to the appellant, then known as Australian Transmission Corporation Pty Ltd ("ATC"), under an "Asset Sale Agreement". The assets included a transmission licence held by PNV under the Act ("the Transmission Licence"). ATC changed its name to GPU PowerNet Pty Ltd on 30 October 1997 and again changed its name to SPI PowerNet Pty Ltd ("SPI") on 2 July 2000 following the acquisition of its issued capital by SPI Australia Holdings Pty Limited. SPI changed its name to AusNet Transmission Group Pty Ltd ("AusNet") on 4 August 2014. The name AusNet, as used throughout these reasons, may be taken to include the company under its earlier names. The central question in this appeal is whether the payments by AusNet of certain statutory charges imposed on PNV as holder of the Transmission Licence transferred to AusNet, and thereafter payable by AusNet, were deductible expenditures under s 8-1 of the Income Tax Assessment Act 1997 (Cth) ("the ITAA") and in particular whether they were payments of capital or of a capital nature within the meaning of s 8-1(2)(a). Section 8-1 relevantly provides: "(1) You can deduct from your assessable income any loss or outgoing to the extent that: it is incurred in gaining or producing your assessable income; or it is necessarily incurred in carrying on a business for the purpose of gaining or producing your assessable income. (2) However, you cannot deduct a loss or outgoing under this section to the extent that: it is a loss or outgoing of capital, or of a capital nature". Bell As appears from subs (2) and as Dixon CJ observed of the analogous s 51(1) of the Income Tax and Social Services Contribution Assessment Act 1936 (Cth)1: "a loss or outgoing incurred in gaining or producing the assessable income or in carrying on a business for that purpose may nevertheless be a loss or outgoing of capital". The charges were imposed by an Order in Council made pursuant to s 163AA of the Electricity Act. They amounted to $177,500,000 and were payable by force of the Electricity Act2. They were also the subject of a contractual promise by AusNet under the Asset Sale Agreement to pay them to the State, in addition to a "Total Purchase Price" of $2,502,600,000 to be paid to PNV for its assets. For the reasons that follow, the primary judge and the majority in the Full Court of the Federal Court were correct to hold that the payments of the charges by AusNet were of a capital nature and therefore, pursuant to s 8-1(2)(a) of the ITAA, were not deductible. They were paid by AusNet as part of the price of acquiring the assets of PNV, including the Transmission Licence, which was an essential element of the transmission business. The licence was essential because s 159 of the Electricity Act provided that a person must not engage in the transmission of electricity unless the person was the holder of a licence authorising that activity or was exempted from the requirement to obtain a licence in respect of that activity3. These reasons consider the following sequence of topics: The procedural history. The decision of the primary judge. (iii) The decision of the Full Court. (iv) The issues on the appeal. Capital or revenue account — general principles. (vi) The Office of the Regulator-General. John Fairfax & Sons Pty Ltd v Federal Commissioner of Taxation (1959) 101 CLR 30 at 34; [1959] HCA 4. 2 Electricity Act, s 163AA(2). 3 Electricity Act, s 159(1). Bell (vii) The Transmission Licence and its conditions. (viii) Section 163AA of the Electricity Act. (ix) Section 163A of the Electricity Act and the decision of the Full Court of the Federal Court in United Energy Ltd v Commissioner of Taxation4, which characterised payments of franchise fees under that provision as capital in character. The Order in Council under which the charges under s 163AA were imposed. (xi) The Asset Sale Agreement. (xii) The rationale of the Order in Council. (xiii) The characterisation of the AusNet payments. (xiv) Conclusion. The procedural history AusNet did not claim income tax deductions for the s 163AA charges in its incarnation as ATC. After ATC became SPI, SPI self-amended its tax returns for the 1999 and 2000 income tax years, and claimed deductions for the payment of the charges in those years, and also claimed the deduction in its tax return for the 2001 tax year. Each of the 1999, 2000 and 2001 tax years was a "Loss Year"5. However, SPI claimed deductions in subsequent years with respect to losses referable to the Loss Years. Following the formation of the SP Australia tax consolidated group, SPI ("SPANT") Networks (Transmission) Ltd recalculated its taxable income for the substituted accounting period ended 31 March 2006. In doing so, it utilised a tax loss referable to the Loss Years6. (1997) 78 FCR 169. 5 A "loss year" for a company is an income year where it has a "tax loss": ITAA, ss 165-70(5), 175-35(5). There will be a "tax loss" if certain deductions exceed certain incomes for the company for the income year: ITAA, ss 165-70(1)‒(5), 6 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation 2013 ATC ¶20-416 at Bell The Commissioner of Taxation began an audit of the SPANT tax consolidated group on or about 15 December 2008 and issued amended assessments disallowing the deductions claimed or carried forward losses used by SPI for the 2001 to 2006 income tax years. SPI objected to the assessments but its objections were disallowed by a notice from the Commissioner dated 15 August 20127. AusNet, as SPI, subsequently filed notices of "appeal" in the original jurisdiction of the Federal Court against the Commissioner's objection decisions pursuant to s 14ZZ of the Taxation Administration Act 1953 (Cth) ("the Taxation Administration Act"). On 19 September 2013, the primary judge (Gordon J) dismissed each of the applications instituted pursuant to the notices of appeal under the Taxation Administration Act and directed that AusNet pay the Commissioner's costs, to be taxed unless agreed. AusNet then appealed to the Full Court of the Federal Court. On 7 April 2014 the Full Court (Edmonds and McKerracher JJ, Davies J dissenting) ordered that the appeal be dismissed with costs. On 12 December 2014, this Court (Crennan, Kiefel and Bell JJ) granted special leave to AusNet to appeal from the judgment of the Full Court of the Federal Court8. In the same order, the Court directed that the appellant's name on this Court's record be changed to AusNet Transmission Group Pty Ltd. The decision of the primary judge The primary judge held that the payments of the s 163AA charges were payments made by AusNet out of its profits after the calculation of its taxable income9. They were not an outgoing incurred in gaining or producing its assessable income or necessarily incurred in carrying on a business for the purpose of gaining or producing such assessable income. They therefore did not satisfy either limb of s 8-1(1). Her Honour went on to consider whether the payments constituted a loss or outgoing of capital or of a capital nature within the meaning of s 8-1(2). Her Honour observed that the obligation to make the payments was specifically included in the Asset Sale Agreement as an element of the acquisition of the transmission business, although it was not part of the purchase price10. The fact 7 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation 2013 ATC ¶20-416 at [2014] HCATrans 288. 9 2013 ATC ¶20-416 at 15,500 [79]‒[80]. 10 2013 ATC ¶20-416 at 15,502 [88]. Bell that the payments were of charges imposed on the holder of the Transmission Licence did not confer upon them a revenue character. They were not related to the process of derivation of income after privatisation, and they were not a "working expense"11. They were an outgoing of capital or of a capital nature12. The decision of the Full Court Edmonds J disagreed with the primary judge's conclusion that the payments did not fall within s 8-1(1) of the ITAA. In particular, he did not accept that there was a basis for her Honour's finding that the payment of the imposts came out of profits after the calculation of taxable income13. On the other hand, his Honour agreed that the outgoings were of capital or capital in nature14. They were part of the cost to AusNet of acquiring the Transmission Licence, which was unarguably a capital asset15. McKerracher J, like Edmonds J, accepted AusNet's submission that the imposts would have qualified for general deduction as an outgoing necessarily incurred for the purpose of gaining assessable income16. However, like Edmonds J and the primary judge, he took the view that they were capital payments incurred in order to acquire an asset. Davies J dissented, taking the view that the payments were deductible under s 8-1(1) of the ITAA and that they were not of a capital nature17. The issues on the appeal AusNet's Notice of Appeal the characterisation of the payments of the charges imposed pursuant to s 163AA as this Court was directed 11 2013 ATC ¶20-416 at 15,502 [92]. 12 2013 ATC ¶20-416 at 15,503 [93]. 13 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation (2014) 220 FCR 355 at 14 (2014) 220 FCR 355 at 359 [11]. 15 (2014) 220 FCR 355 at 359 [12]. 16 (2014) 220 FCR 355 at 363 [29]. 17 (2014) 220 FCR 355 at 372 [80]‒[81]. Bell payments of capital or of a capital nature. By Notice of Contention, the Commissioner asserted that the decision of the Full Court should be affirmed on the basis that the payments did not satisfy the positive requirements of s 8-1(1) of the ITAA. The answer to the first question is determinative and the Notice of Contention is not reached. Capital or revenue account — general principles The evaluative judgment required to distinguish between expenditure on capital or revenue account is made under the guidance of approaches developed in decisions of this Court over many years. Those approaches have necessarily been expressed with a degree of generality sometimes criticised for unpredictability in the outcomes they yield18. However, as Dixon J observed in Hallstroms Pty Ltd v Federal Commissioner of Taxation19, the courts, having been given by the income tax law "a very general conception of accountancy, perhaps of economics", have proceeded with the task "in the traditional way of stating what positive factor or factors in each given case led to a decision assigning the expenditure to capital or to income as the case might be". The distinction between capital and revenue expenditure is readily discerned in cases close to the core of each of those concepts. A once and for all payment for the acquisition of business premises would be treated as an outlay of capital. A rental payment under a lease of the same premises would be treated as an outgoing on revenue account. The distinction is not so readily apparent in penumbral cases. They may require a weighing of factors including the form, purpose and effect of the expenditure, the benefit derived from it and its relationship to the structure, as distinct from the conduct, of a business. Some of those factors may point in one direction and some in another20. Definitive and specific criteria are not, and never have been, in abundance in Australia, nor in the decisions of the courts of the United Kingdom in the late 19th century and the first half of the 20th century which have been referred to from time to time in this Court's decisions. Lord Dunedin suggested in 1910 that a distinction between a 18 In Inland Revenue Commissioners v British Salmson Aero Engines Ltd [1938] 2 KB 482 at 498 Sir Wilfrid Greene MR equated the process to "the spin of a coin". The late Professor Julius Stone relegated the distinction to a legal category of meaningless reference: Stone, Legal System and Lawyers' Reasonings, (1964) at 19 (1946) 72 CLR 634 at 646; [1946] HCA 34. 20 BP Australia Ltd v Federal Commissioner of Taxation (1965) 112 CLR 386 at 397; [1966] AC 224 at 264. Bell once and for all payment and a recurrent payment may be "in a rough way ... not a bad criterion of what is capital expenditure ... as against what is income expenditure"21. Viscount Cave LC in British Insulated and Helsby Cables v Atherton22 cautioned that this criterion is not decisive in every case23. In that case, the "once and for all" character of an expenditure was treated as an indicator that it was in the nature of a capital outlay, a fortiori, when made "with a view to bringing into existence an asset or an advantage for the enduring benefit of a trade"24. Even then there might be "special circumstances" leading to an opposite conclusion25. British Insulated and Helsby Cables was long treated in this Court as "the leading case on the subject"26. The fact that a payment is recurrent is not determinative of its character. The payment by instalments of a charge, imposed as a condition upon the grant of a liquor licence reflecting its monopoly value, was held by the Court of Appeal in Henriksen v Grafton Hotel Ltd27 to be a capital outlay. Du Parcq LJ, citing Viscount Cave LC, said28: "Here each sum in question was part of a total amount paid to acquire the right to trade for a period of years. At the date when that period began the possession of that right was essential before trading could be begun. In these circumstances, I am of opinion that each sum paid must be considered part of a capital outlay." 21 Vallambrosa Rubber Co Ltd v Inland Revenue 1910 SC 519 at 525. 23 [1926] AC 205 at 213. 24 [1926] AC 205 at 213‒214 per Viscount Cave LC. 25 [1926] AC 205 at 213‒214 per Viscount Cave LC. 26 Broken Hill Theatres Pty Ltd v Federal Commissioner of Taxation (1952) 85 CLR 423 at 434 per Dixon CJ, McTiernan, Fullagar and Kitto JJ; [1952] HCA 75. 28 [1942] 2 KB 184 at 195, citing British Insulated and Helsby Cables v Atherton [1926] AC 205 at 213‒214. Bell Referring to that decision, the Privy Council in BP Australia Ltd v Federal Commissioner of Taxation29 observed that: "Without the license the business could not be carried on. There was also an element of monopoly." The term "an element of monopoly" might today be understood in terms of enhanced market power where the requirement for a licence, not freely given to all comers, constitutes a barrier to entry for potential competitors into the relevant market. The need for Viscount Cave LC's caution about Lord Dunedin's "rough" criterion was illustrated in Royal Insurance Co v Watson30. The purchaser of an insurance business agreed, as part of the purchase arrangements, to pay a fixed salary to a continuing employee with an election to commute the salary to a gross sum and terminate the employment. The salary, whether or not commuted, was found to be part of the consideration for the purchase of the business and thereby an outgoing of a capital nature. Lord Halsbury LC put it thus31: "The result is that one of the companies sells to the other, and part of the consideration which was contemplated by both parties, and in respect of which the bargain was made, and without which it would not have been made, was the manager, and all that was incident to the manager, in respect of the payments to be made to him, whether made at once or made in this form of commutation." The key factor in characterisation in that case, which is of considerable significance in the present appeal, was that the contested payment was part of the consideration for the acquisition of the business32. In the ordinary course, a lump sum paid to an employee to procure his or her resignation would be on revenue 29 (1965) 112 CLR 386 at 405; [1966] AC 224 at 273. 31 [1897] AC 1 at 7. 32 [1897] AC 1 at 7 per Lord Halsbury LC, 8 per Lord Herschell, 9 per Lord Macnaghten, 10 per Lord Shand, 10‒11 per Lord Davey. Bell account "made for the purpose of organizing the staff and as part of the necessary expenses of conducting the business"33. The significance attached to the purchase price of a business by the Privy Council in Tata Hydro-Electric Agencies, Bombay v Income-tax Commissioner, Bombay Presidency and Aden34 was debated in the submissions on this appeal. The contested outlay in that case was a payment by the assignees of an agency business of a percentage of certain commissions, in discharge of an obligation owed by the assignor to certain third parties. The statutory test of deductibility under s 10(2)(ix) of the Indian Income-tax Act 1922 required that the "expenditure (not being in the nature of capital expenditure) [was made] solely for the purpose of earning such profits or gains". In holding that the payments were not deductible, the Privy Council, in a passage quoted by the primary judge, said35: "the obligation to make these payments was undertaken by the appellants in consideration of their acquisition of the right and opportunity to earn profits, that is, of the right to conduct the business, and not for the purpose of producing profits in the conduct of the business". AusNet pointed out that the question considered by the Privy Council was the positive question posed by s 10(2), not the negative question relating to capital expenditure. The negative question was not reached because the positive question was answered adversely to the taxpayer. Nevertheless, the passage quoted was consistent with the approach adopted in this Court to the characterisation of expenditure as being "of a capital nature". So much appears from the discussion below of the judgment of Fullagar J in Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation36, which referred to Tata Hydro-Electric37. The fact that a payment can be viewed as part of the consideration for the acquisition of a business or capital asset weighs heavily in 33 W Nevill & Co Ltd v Federal Commissioner of Taxation (1937) 56 CLR 290 at 306 per Dixon J, see also at 302 per Latham CJ, 304 per Rich J, 308 per McTiernan J; [1937] HCA 9. 35 [1937] AC 685 at 695, quoted at 2013 ATC ¶20-416 at 15,502 [90]. 36 (1953) 89 CLR 428; [1953] HCA 68: see (2014) 220 FCR 355 at 359 [12], 362 [25] per Edmonds J, 368‒369 [56]‒[59] per McKerracher J. 37 (1953) 89 CLR 428 at 455. Bell favour of its character as a capital outlay. However, as also appears from Cliffs International Inc v Federal Commissioner of Taxation38, the question must always be asked — was the payment made "for" the acquisition? The proposition is well established that expenditure of a kind ordinarily treated as being on revenue account in one set of circumstances may be treated as on capital account in another set of circumstances. An example is found in the decision of the Scottish Court of Session in Law Shipping Co v Inland Revenue39. The expenditure of substantial sums on repairs to a ship which had been necessary at the time of its purchase was treated as capital40. The need for repairs meant that the ship when purchased was a less valuable asset than if it had been in repair41. Absent the need for repairs, the sellers could have demanded a higher price42. Analogical reasoning suggests that the Transmission Licence, bringing with it as it did the burden of the charges imposed under s 163AA, was on that account a less valuable asset than it would have been if PNV had paid the charges before transfer. Both parties in this appeal relied upon well-known passages about the characterisation of capital and revenue outlays in the judgment of Dixon J in Sun Newspapers Ltd v Federal Commissioner of Taxation43. The contested expenditure by Sun Newspapers secured, from its potential competitor, a non- compete covenant which was limited in duration and spatial coverage. Although, as Rich J held at first instance, it was a wasting asset, that did not deprive it of its capital character44. Its purpose was "to buy out opposition and secure so far as 38 (1979) 142 CLR 140; [1979] HCA 8. 40 1924 SC 74 at 79‒80 per Lord Clyde, 80‒81 per Lord Skerrington, 81 per Lord Cullen, 81‒82 per Lord Sands. 41 1924 SC 74 at 79 per Lord Clyde. 42 1924 SC 74 at 79 per Lord Clyde. 43 (1938) 61 CLR 337; [1938] HCA 73, described in BP Australia Ltd v Federal Commissioner of Taxation (1965) 112 CLR 386 at 394; [1966] AC 224 at 261 as a "valuable guide to the traveller in these regions". 44 See Parsons, Income Taxation in Australia, (1985) at 431‒432 [7.10] for a discussion of wasting assets as structural capital assets, the costs of which are on capital account and non-deductible. Bell possible a monopoly"45. As Latham CJ said, the payment obtained "a very real benefit or advantage ... namely, the exclusion of what might have been serious competition"46. Dixon J said that the distinction between capital and revenue account expenditure corresponded with the distinction between the business entity, structure or organisation set up or established for the earning of profit and the process by which such an organisation operates to obtain regular returns by means of regular outlay47. Acknowledging the infinite variety of business structures, his Honour said that some might comprise little more than the intangible elements constituting goodwill48. Implicit in that observation was the uncontroversial proposition that an intangible asset might, according to its nature and function in the conduct of the business, be properly characterised as forming part of the structure of the business and the cost of its acquisition as a capital cost. As Starke J said in Hallstroms Pty Ltd v Federal Commissioner of Taxation49 after quoting Dixon J in Sun Newspapers: "The asset or advantage need not have a tangible existence: thus the acquisition of the goodwill of a business or of restrictive covenants not to compete in business and the promotion of Parliamentary bills and so forth may all involve expenditure of capital or of a capital nature." (citation omitted) As in the case of Henriksen v Grafton Hotel Ltd, mentioned earlier, a licence, essential to the conduct of the business, may fall within that description. Dixon J in Sun Newspapers analysed the question of characterisation by consideration of three factors50: 45 (1938) 61 CLR 337 at 347. 46 (1938) 61 CLR 337 at 355. 47 (1938) 61 CLR 337 at 359. 48 (1938) 61 CLR 337 at 359‒360. 49 (1946) 72 CLR 634 at 644. See also British Insulated and Helsby Cables v Atherton [1926] AC 205 at 222 per Lord Atkinson; Van den Berghs Ltd v Clark [1935] AC 431 at 439‒440 per Lord Macmillan. 50 (1938) 61 CLR 337 at 363. Bell "(a) the character of the advantage sought, and in this its lasting qualities may play a part, (b) the manner in which it is to be used, relied upon or enjoyed, and in this and under the former head recurrence may play its part, and (c) the means adopted to obtain it; that is, by providing a periodical reward or outlay to cover its use or enjoyment for periods commensurate with the payment or by making a final provision or payment so as to secure future use or enjoyment." He later observed in Hallstroms Pty Ltd v Federal Commissioner of Taxation that the distinction also depends upon "what the expenditure is calculated to effect from a practical and business point of view, rather than upon the juristic classification of the legal rights, if any, secured, employed or exhausted in the process"51. The advantage may not comprise any "rights" at all. In holding in John Fairfax & Sons Pty Ltd v Federal Commissioner of Taxation52 that the corporate taxpayer's legal costs in a contest over control of another company were of a capital nature, Dixon CJ said53: "It is not in my opinion right to say that because you obtain nothing positive, nothing of an enduring nature, for an expenditure it cannot be an outgoing on account of capital." The competition in that case, as Fullagar J put it, was "for a capital gain or advantage"54. It should be added, however, that the emphasis placed by Dixon J on the "practical and business point of view" does not mean that it is unnecessary to examine the legal rights (if any) obtained by the expenditure55. The real question, as Gibbs ACJ identified it in Federal Commissioner of Taxation v South Australian Battery Makers Pty Ltd56, may be "not to determine the character of the advantage sought, once it has been identified, but to decide 51 (1946) 72 CLR 634 at 648. 52 (1959) 101 CLR 30. 53 (1959) 101 CLR 30 at 36, Kitto J agreeing at 43. 54 (1959) 101 CLR 30 at 42. 55 Federal Commissioner of Taxation v South Australian Battery Makers Pty Ltd (1978) 140 CLR 645 at 662 per Stephen and Aickin JJ; [1978] HCA 32. 56 (1978) 140 CLR 645. Bell what was the advantage sought by the taxpayer by making the payments"57. If one advantage for the acquisition of a capital asset was "the fact that the payments were called 'rent', and were made periodically, [that] would not necessarily prevent them from being in part outgoings of a capital nature"58. It might be thought that that observation has considerable relevance to the present case. The assumption by AusNet of liability to pay the s 163AA charges by operation of law upon the transfer of the licence to it and by the contractual promise to pay the charges was, as appears later in these reasons, an integral part of the consideration it had to provide in order to acquire the assets of the transmission business, which necessarily included the Transmission Licence. The observation of Gibbs ACJ was reflected in GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation59, in which the Court said "the chief, if not the critical, factor" is the character of the advantage sought by the expenditure60. That factor had been the focus of consideration in Colonial Mutual Life, which was relied upon by the Commissioner in this case. In Colonial Mutual Life, payments by the purchaser of an income producing property of a percentage of the rents derived from it, made as part of the consideration for the acquisition of the property, were held to be on capital account. The parties to this appeal focussed upon the observation of Fullagar J, with whom Kitto and Taylor JJ agreed61, that the payments were made in order to acquire a capital asset and that they constituted the price payable on the purchase of the land. How they were calculated, how and when they were payable and whether they might cease to be payable for a time, did not matter. Fullagar J said62: "If they are paid as parts of the purchase price of an asset forming part of the fixed capital of the company, they are outgoings of capital or of a capital nature." 57 (1978) 140 CLR 645 at 655. 58 (1978) 140 CLR 645 at 655. 59 (1990) 170 CLR 124; [1990] HCA 25. 60 (1990) 170 CLR 124 at 137. 61 (1953) 89 CLR 428 at 460. 62 (1953) 89 CLR 428 at 454. Bell His Honour formulated the questions commonly arising in such cases as63: "(1) What is the money really paid for?—and (2) Is what it is really paid for, in truth and in substance, a capital asset?" (emphasis in original) Williams ACJ treated the case as indistinguishable from Tata Hydro- Electric and applied what Dixon J had said in Sun Newspapers. His Honour adopted as the relevant question64: "Are the sums in question ... capital outlays, are they expenditure necessary for the acquisition of property or of rights of a permanent character the possession of which is a condition of carrying on the trade at all?" Webb J also treated the outgoings as "expenditure for the acquisition of a capital asset ... and not expenditure in the working of that or any other asset with a view to making it income-producing, although this asset is to be used for rent- production"65. The thrust of the reasoning in each of the three separate judgments of Williams ACJ, Webb and Fullagar JJ was to the same effect. AusNet questioned reliance upon the proposition, taken in isolation from the judgment of Fullagar J, that payments, however calculated or payable and whenever payable, if made as part of the purchase price for an asset forming part of the fixed capital of the taxpayer were outgoings of capital or of a capital nature. As AusNet pointed out, the proposition directs attention to the question then formulated by Fullagar J — "what is the money really paid for?" AusNet accepted that in the usual case an outgoing which forms part of the consideration for the acquisition of a capital asset will be "for" the advantage of securing that asset on an enduring basis. The usual case, however, is not every case. AusNet pointed to the treatment by this Court, in Commissioner of Taxation v Morgan66, of the apportionment of municipal and water rates reimbursed by a purchaser of land to the vendors, who had paid the annual levy covering a period beyond the date of transfer of the land to the purchaser. The 63 (1953) 89 CLR 428 at 454. 64 (1953) 89 CLR 428 at 448, derived from the test applied by Lord Clyde in Robert Addie & Sons' Collieries v Inland Revenue 1924 SC 231 at 235. 65 (1953) 89 CLR 428 at 448‒449. 66 (1961) 106 CLR 517; [1961] HCA 64. Bell apportionment was treated as paid on revenue account. It is important, however, to note the factors upon which the Court focussed in that case, including the separateness of the payment from the purchase price and, importantly, its variability dependent upon the time of settlement. That variability reflected its treatment between vendor and purchaser as part of the "flow" of outgoings characteristic of expenditure on revenue account67. The time-dependent and variable character of the outgoing and its place in the contract of sale put it in a different category from the fixed liability assumed by AusNet upon transfer to it of the Transmission Licence, both by force of the statute and, as will be seen, pursuant to its contractual promise to pay the charges. AusNet also relied upon Cliffs International, in which Colonial Mutual Life was distinguished68. The contested expenditures in that case were royalty payments on iron ore mined by the taxpayer which were paid to the vendors of shares acquired by the taxpayer in a mining company which held certain tenements. The payments were held to be on revenue account and thereby deductible. Barwick CJ said that the fact that the promise to make the payments was part of the consideration for the acquisition of the capital asset did not necessarily mean that they were of a capital nature69. The promise to make the payments was part of the consideration given for the purchase of the shares70: "[b]ut they were acquired without making the payments in question. The recurrent payments were not made for the shares though it might properly be said that they were payable as a consequence of the purchase of the shares." The Chief Justice did not find the facts in Colonial Mutual Life analogous although he did not say why and expressly left open the correctness of that decision71. As appears from the passage quoted, he effectively found that the payments were not made "for" the shares. Jacobs J, also in the majority, acknowledged that in Colonial Mutual Life the recurrent payments could hardly 67 (1961) 106 CLR 517 at 521 per Dixon CJ, Kitto and Windeyer JJ. 68 (1979) 142 CLR 140 at 151 per Barwick CJ, 175 per Jacobs J. 69 (1979) 142 CLR 140 at 148, citing Egerton-Warburton v Deputy Federal Commissioner of Taxation (1934) 51 CLR 568 at 572–573; [1934] HCA 40. 70 (1979) 142 CLR 140 at 149. 71 (1979) 142 CLR 140 at 151. Bell be regarded otherwise than as part of the cost of the acquisition of the freehold72. Accepting that each case turned on its own facts and circumstances, he said of the case before him73: "The preponderating factors are that the payments were in respect of a depreciating asset, that they were recurrent over the life of the asset if the asset was used throughout its life and that the amount of the payments were proportioned to the use made of the asset. These factors in my opinion clearly outweigh the other factors which might support a contrary view." Murphy J, who formed the third member of the majority, found that there was a strong analogy with an agreement to pay rent as part of the consideration for acquisition of a lease74. Gibbs and Stephen JJ dissented, holding that the case was covered by the principle on which Colonial Mutual Life was decided75. The majority judgments do not disclose a common proposition applicable to this case. More recently, in Federal Commissioner of Taxation v Citylink Melbourne Ltd76, payment of a fixed annual "base concession fee" as part of the consideration given by the taxpayer to the State of Victoria for the concession to construct and operate a toll road system was held to be deductible. In rejecting the proposition that the payment was on capital account, Crennan J, with whom Gleeson CJ, Gummow, Callinan and Heydon JJ agreed77, observed that the taxpayer did not acquire permanent ownership of the roads or associated land. Her Honour said78: "Unlike periodic instalments paid on the purchase price of a capital asset, the concession fees are periodic licence fees in respect of the Link 72 (1979) 142 CLR 140 at 175. 73 (1979) 142 CLR 140 at 175. 74 (1979) 142 CLR 140 at 176. 75 (1979) 142 CLR 140 at 156 per Gibbs J, 161 per Stephen J. 76 (2006) 228 CLR 1; [2006] HCA 35. 77 (2006) 228 CLR 1 at 8 [1] per Gleeson CJ, 8 [2] per Gummow J, 27 [76] per Callinan J, 27 [77] per Heydon J. 78 (2006) 228 CLR 1 at 44 [154]. Bell infrastructure assets, from which the [taxpayer] derives its income, but which are ultimately 'surrendered back' to the State. Accordingly, they are on revenue account." As appears below, the charges imposed under s 163AA, being of an ad hoc character imposed for a time-limited purpose, could not be described as "periodic licence fees". Periodic fees were payable in respect of the Transmission Licence but pursuant to a separate provision of the Electricity Act. Against that background it is now convenient to turn to the legislative framework. The Office of the Regulator-General It is necessary, in order to understand the relevant regulatory provisions of the Electricity Act and the provisions of the Transmission Licence, to say something about the Office of the Regulator-General. That Office was established under the Office of the Regulator-General Act 1994 (Vic) ("the Regulator-General Act"). The Office is empowered to act as regulator of any industry specified as a "regulated industry" by the legislation under which the industry operates or by an Order in Council79. Its involvement in the electricity industry came from Pt 12 of the Electricity Act, introduced into the Act in 199480, and conferred regulatory functions on the Office81. The Office was given the power under Pt 12 to regulate charges for connection to, and the use of, the transmission system82. It was also responsible for approving the grant83, 79 Regulator-General Act, s 8, read with the definition of "regulated industry" in 80 Electricity Industry (Amendment) Act 1994 (Vic), s 25. 81 Electricity Act, s 155. 82 See eg Electricity Act, s 158(1)(b)(iii). 83 Electricity Act, s 162(1). Bell transfer84 and revocation85 of licences under the Electricity Act, including transmission licences86. The Transmission Licence and its conditions A transmission licence granted pursuant to s 162 of the Electricity Act could be granted for such term (if any)87 and on such conditions88 as were determined by the Office of the Regulator-General. A non-exhaustive list of conditions which could be imposed upon a licence was set out in s 163(3), including the requirement in s 163(3)(a) that: "the licensee ... pay specified fees and charges in respect of the licence to the Office". Section 163(4) required that the fees and charges so specified be determined by the Minister having regard to the proportion of the total cost of the Office incurred in the administration of Pt 12. The Office could also determine conditions specifying procedures for the variation or revocation of the licence89. The Office was empowered under s 164(3) to revoke the licence in accordance with the procedures specified in the licence conditions. Clause 2 of the Transmission Licence granted to PNV and transferred to AusNet pursuant to the Asset Sale Agreement on 6 November 1997 provided: "The Office, in exercise of the powers conferred by section 162 and section 168 of the Act, licenses the Licensee to transmit electricity and to supply electricity using the Licensee's electricity transmission system, subject to the conditions set out in this licence." 84 Electricity Act, s 167(5). 85 Electricity Act, s 164(3). 86 Electricity Act, s 161(1)(b). 87 Electricity Act, s 163(1). 88 Electricity Act, s 163(2). 89 Electricity Act, s 163(3)(h). Bell The licence took effect on and from 3 October 199490. It was a condition of the licence that the licensee pay the fees and charges determined by the Minister under s 163(4) of the Electricity Act91. Clause 18 of the Transmission Licence provided: "COMPLIANCE WITH LAWS The Licensee must comply with all applicable laws including but not limited to the Tariff Order." It may be taken, although it was not argued, that cl 18 applied to the statutory obligation to pay charges imposed under s 163AA. Non-compliance with cl 18, or any other condition, did not automatically lead to loss of the licence. There was a process for its revocation. Clause 3.2 provided for revocation of the licence by the Office of the Regulator-General in accordance with cll 3.3 and 3.4. Clause 3.4 empowered the Office to give a notice of revocation to the licensee if the licensee did not comply with an "enforcement order" or an undertaking, and the Office decided that it was necessary or desirable to revoke the licence in order to achieve certain policy objectives92, in which case the term of the licence would end, subject to cl 3.5, on the expiration of the period of the notice. The term "enforcement order" refers to an enforcement order served under s 35 of the Regulator-General Act. Section 35 applied where the Office was, as in this case, responsible under relevant legislation for licensing, and a person was contravening, or in the opinion of the Office was likely to contravene, the conditions of a licence, and the Office considered that the contravention or likely contravention was not of a trivial nature93. The Office could serve an order on the person (which might be 90 Transmission Licence, cl 3.1. 91 Transmission Licence, cl 16.1. There was no condition relating to the charges imposed under s 163AA, as that provision had not been enacted at the time that the licence issued. 92 The objectives specified in s 157 of the Electricity Act and s 7 of the Regulator- General Act and, to the extent context requires, in a statement of government policy under s 10 of the Regulator-General Act: Transmission Licence, Schedule, cl 1, definition of "policy objectives". 93 Regulator-General Act, s 35(1). Bell provisional or final) requiring the person to comply with the licence condition94. It was an offence for a person not to comply with such an order95. Importantly, failure to pay a charge imposed under s 163AA, while placing the licensee at risk of revocation, did not necessarily lead to revocation of the licence. The State could simply take action in such a case to recover the charge as a debt when it became due and payable. It is convenient now to consider s 163AA of the Electricity Act, under which the Order in Council was made which imposed the charges on PNV, as holder of the Transmission Licence, which were ultimately paid by AusNet. Section 163AA of the Electricity Industry Act 1993 Section 163AA of the Electricity Act was inserted in that Act in 199596. As at October 1997 it provided: "Charges payable to Treasurer The Governor in Council, on the recommendation of the Treasurer, may, by Order published in the Government Gazette, declare that specified charges, or charges calculated in a specified manner, are payable as an impost by the holder of a licence at such times and in such manner as are so specified. The holder of a licence must pay to the Treasurer for payment into the Consolidated Fund the charges determined under sub- section (1) and applicable to the licence at the times and in the manner so determined. (3) An Order made under this section does not apply to a distribution company, a transmission company or a generation company that ceased to be a public distribution company, public transmission company or public generation company before the Order was made. 94 Regulator-General Act, s 35(2). 95 Regulator-General Act, s 35(8). 96 Electricity Industry (Further Amendment) Act 1995 (Vic), s 13. Bell (4) Nothing in this section or in an Order under this section prevents a charge being paid, or the payment of a charge being received, before the due date for payment." Section 163AA(3) had been amended, with effect from 3 June 1997, to include references to "a transmission company" and "public transmission company"97. "[T]ransmission company" meant98: "(a) Power Net Victoria while it continues to hold a licence to transmit electricity issued under Part 12; a person who is the holder of a licence to transmit electricity issued under Part 12, being a person declared by Order of the Governor in Council published in the Government Gazette to be a transmission company for the purposes of this Act". "[P]ublic transmission company" meant a transmission company which was99: a statutory authority; or a company all the shares in which are held by, or on behalf of, the State or a statutory authority". Other provisions of Pt 12 gave content to the definitions. Section 161(1) provided that a person could apply to the Office of the Regulator-General for the issue of a licence authorising one or more of a number of certain activities where specified in the licence, including "to transmit electricity"100. The term "licence" was defined in s 154 as "a licence specified in section 161(1)". It follows from the definitions of "transmission company" and "public transmission company" that PNV would cease to be a public transmission company for the purposes of s 163AA(3) if it ceased to be a licence holder or if it 97 Electricity Industry (Miscellaneous Amendment) Act 1997 (Vic), s 24(b). 98 Electricity Act, s 3(1), inserted by Electricity Industry (Miscellaneous Amendment) Act 1997 (Vic), s 18(b). 99 Electricity Act, s 3(1), inserted by Electricity Industry (Miscellaneous Amendment) Act 1997 (Vic), s 18(a). 100 Electricity Act, s 161(1)(b). Bell ceased to be a State-owned company. It followed that no charge could be imposed on PNV under s 163AA after it had transferred the licence to AusNet. As appears below, the Asset Sale Agreement included a provision that AusNet would not challenge the validity of the charges imposed on PNV pursuant to s 163AA which AusNet was to pay post-transfer. The imposition of the charges on PNV, which was in effect an instrumentality of the State of Victoria, may have been calculated to avoid characterisation of the charges as an excise101. However, the liability to pay the charges, in this case, was extended by the Order in Council to transferees of the licence from PNV. Although it was acknowledged by counsel for AusNet that characterisation of the charges as an excise may have been a continuing concern, no submissions were made on the question whether they were, and it is neither necessary nor desirable to express a view on that matter, which, in any event, would involve a question arising under the Constitution. It is sufficient for present purposes to observe that, as appears from the Asset Sale Agreement, the possibility of a challenge by AusNet to the validity of the charges was contractually precluded. There is no suggestion that the contractual provision was unnecessary or unenforceable. It was an element of the consideration moving from AusNet under the agreement. It is necessary next to refer to s 163A of the Electricity Act, which provided for the imposition, by Order in Council, of franchise fees on distribution companies. The Full Court of the Federal Court in United Energy held that the payment of the franchise fees was on capital account. Its reasoning has significance for this case. Section 163A of the Electricity Industry Act 1993 — an analogous provision? As part of the process leading from State ownership of the electricity industry to full privatisation, five entities known as "Municipal Electricity Undertakings" were restructured into five regionally based distribution companies each with a retail arm and a regulated geographic distribution area. That process took place in 1994. Each distribution company was, until December 2000, to be the sole retailer of electricity for what were designated as "franchise customers" in a "franchise area". In effect, the distribution companies, which were privatised on 31 January 1995, had exclusive licences in respect of their areas. 101 See Queanbeyan City Council v ACTEW Corporation Ltd (2011) 244 CLR 530 at 541‒542 [19]‒[22] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; [2011] HCA 40. Bell Section 163A102 provided that a distribution company which was the holder of an exclusive licence under Pt 12 of the Act was to103: "pay to the Treasurer, in respect of each financial year during which it holds, or held, such a licence the impost determined in respect of that year by Order of the Governor in Council, on the recommendation of the Treasurer, applying to that company and published in the Government Gazette". The Treasurer, in recommending the amount of an impost for each financial year, was required to be satisfied that the amount reasonably represented the amount by which the income of the company derived from the sale of electricity to franchise customers in that year was likely to exceed the sum of the costs of deriving the income, taxes payable in deriving that income and a reasonable return on the capital of the company used in deriving that income104. The payments of franchise fees by distribution companies under s 163A were held by the Full Court of the Federal Court in United Energy to be not deductible because they were payments of a capital nature105. Lockhart J asked the questions posed by Fullagar J in the Colonial Mutual Life decision — "what is the money really paid for and is what it is really paid for in truth and in substance, a capital asset?"106 Their answers required a practical examination of the facts concerning "what the expenditure is calculated to effect from a practical and business point of view"107. His Honour concluded that the payments could be viewed in substance as a purchase price for a business which the distribution 102 Introduced by s 29 of the Electricity Industry (Further Amendment) Act 1994 (Vic) and substituted by s 30 of the Electricity Industry (Amendment) Act 1995 (Vic). 103 Electricity Act, s 163A(1). 104 Electricity Act, s 163A(2)(a)‒(c). 105 (1997) 78 FCR 169 at 181 per Lockhart J, 196 per Sundberg and Merkel JJ. Special leave to appeal from that decision was refused by this Court on 13 February 1998: [1998] HCATrans 41. 106 (1997) 78 FCR 169 at 181. 107 (1997) 78 FCR 169 at 182, quoting BP Australia Ltd v Federal Commissioner of Taxation (1965) 112 CLR 386 at 397; [1966] AC 224 at 264. Bell company had acquired for nothing and which conferred on it monopoly power in a specific geographic area108: "In return for obtaining the exclusive right to conduct its business in Melbourne, the applicant makes payment of franchise fee until the monopoly runs out in the year 2001; it receives the monopoly right to distribute and sell electricity in its defined area and in return makes payment of the associated monopoly rent." Sundberg and Merkel JJ characterised the franchise fee as benefiting "the business entity, structure, or organisation set up or established for the earning of profit"109. They also invoked the joint judgment in Broken Hill Theatres Pty Ltd v Federal Commissioner of Taxation110, observing that111: "'the advantage of being free from ... competition' in the sale of electricity for the period for which the franchise fee is payable is 'just the very kind of thing which has been held in many cases to give to moneys expended in obtaining [that advantage] the character of capital outlay'". The payments of the fees, as a monopoly rent for freedom from competition in respect of a substantial body of retail customers in the taxpayer's licence area, were held to be qualitatively different from payments of the annual licence fees payable under the licence to sell electricity in Victoria112. AusNet submitted that the charges under s 163AA of the Electricity Act were a tax. It suffices to say that those charges, and those imposed on distribution companies under s 163A, were compulsory exactions of money by a public authority for a public purpose and were not a payment for services 108 (1997) 78 FCR 169 at 182. His Honour also held that the fees did not fall within either limb of deductibility in s 51(1) of the Income Tax Assessment Act 1936 (Cth), and in that respect differed from Sundberg and Merkel JJ, but the difference was not material for present purposes. 109 (1997) 78 FCR 169 at 194, quoting Sun Newspapers Ltd v Federal Commissioner of Taxation (1938) 61 CLR 337 at 359 per Dixon J. 110 (1952) 85 CLR 423 at 434 per Dixon CJ, McTiernan, Fullagar and Kitto JJ. 111 (1997) 78 FCR 169 at 194. 112 (1997) 78 FCR 169 at 196, evidently a reference to the licence fees chargeable pursuant to s 163 of the Electricity Act. Bell rendered. Those attributes may support their characterisation as a tax113, at least with respect to privately owned licence holders114. However, they may not always be determinative115. The charges under s 163A were characterised by the Full Court of the Federal Court in United Energy as the price paid by the distribution companies for a geographic monopoly right116. That characterisation involved the application of orthodox approaches to a particular set of facts. It did not rest upon the proposition that recurrent periodic licence fees paid as a condition of a right to carry on a business activity must always be treated as an affair of capital. As appears later in these reasons, the rationale for the imposition of the charges under s 163A, which included the limitation of the distribution companies to a reasonable return on their capital, was not dissimilar to the rationale for the charges imposed under s 163AA, which were directed to a restriction on the return of capital earned by PNV and its successors in title. Despite the emphasis which AusNet placed upon the purpose of the charges in its submissions, its identification is not determinative and to some extent distracts from the proper approach to characterisation. The critical question must always be — what was the expenditure calculated to effect from the taxpayer's point of view? What was the taxpayer paying the money for? Neither the distribution company in United Energy nor AusNet paid the charges under s 163A and s 163AA respectively in order to limit their return on capital. They paid the charges to secure rights to carry on their respective businesses of the distribution and transmission of electricity. It is now necessary to consider the particulars of the charges imposed on PNV by the Order in Council. 113 See Matthews v Chicory Marketing Board (Vict) (1938) 60 CLR 263 at 276 per Latham CJ, 290 per Dixon J; [1938] HCA 38; Parton v Milk Board (Vict) (1949) 80 CLR 229 at 258 per Dixon J; [1949] HCA 67. 114 cf Queanbeyan City Council v ACTEW Corporation Ltd (2011) 244 CLR 530 at 542 [20]‒[22] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ. 115 Air Caledonie International v The Commonwealth (1988) 165 CLR 462 at 467; [1988] HCA 61; Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 336 per Dawson, Toohey and McHugh JJ; [1989] HCA 47. 116 (1997) 78 FCR 169 at 182 per Lockhart J, 196 per Sundberg and Merkel JJ. See also Browns Transport Pty Ltd v Kropp (1958) 100 CLR 117 at 129–130; [1958] HCA 49, concerning licence fees imposed on road transport operators in Queensland. Bell The Order in Council On 30 October 1997, there was published in the Victorian Government Gazette an Order in Council under s 163AA(1) of the Electricity Act in the following terms: "The Governor in Council acting on the recommendation of the Treasurer under Section 163AA(1) of the Electricity Industry Act 1993 declares that the amounts payable as an impost by Power Net Victoria, as the holder of a licence (the 'Transmission Licence') to transmit electricity issued under Part 12 of the Electricity Industry Act 1993, to the under Treasurer Section 163AA(2) of the Electricity Industry Act 1993, are as follows: the Consolidated Fund payment into for $37,500,000 in respect of the financial year ending 30 June 1998, payable in arrears in two instalments, being $25,000,000 on 31 March 1998 and $12,500,000 payable on 30 June 1998; $50,000,000 in respect of each of the financial years ending 30 June 1999 and 30 June 2000, payable in arrears in four equal instalments on 30 September, 31 December, 31 March and 30 June in each relevant financial year; and $40,000,000 in respect of the 6 months ending on 31 December 2000, payable in arrears in two equal instalments on 30 September 2000 and 31 December 2000. This Order applies to any person or persons (jointly and severally) to whom the Transmission Licence is transferred or any subsequent holder of the Transmission Licence or any person or persons (jointly and severally) who acquire all or substantially all the business of Power Net Victoria and who is or are issued with a licence to transmit electricity under Part 12 of the Electricity Industry Act 1993." There is nothing in s 163AA, nor the Order in Council, to suggest that the charges were imposed as any kind of fee for service. They were not licence fees of the kind imposed pursuant to s 163(3)(a). They did not require for their determination consideration of criteria like those required to be considered in determining fees under s 163(4). Nor did they require, for their determination, that the Treasurer have regard to matters of the kind specified in respect of franchise fees by s 163A(2). In the light of that background, the terms of the Asset Sale Agreement can be examined. Bell The Asset Sale Agreement The parties to the Asset Sale Agreement were the Treasurer of the State of Victoria, designated as "State"; PNV, designated as "Seller"; and AusNet (then known as ATC), designated as "Buyer"117. The recitals to the agreement included: "B. The Seller agrees to sell and the Buyer agrees to buy the Assets (excluding the Land which will be allocated from the Seller to the Buyer) on the terms and conditions set out in this agreement. The total value attributed by the parties to the sale of Assets (net of Creditors and Contract Liabilities) the subject of this agreement is $2,555,000,000 made up of: Total Purchase Price Estimated Duty The parties agree that the total payments to the State in connection with the privatisation of the Seller are $2,732,500,000 (including future licence fees of $177,500,000 payable by the Buyer, which the State values in net present value terms at approximately The term "Assets" was defined to include "the Licences", a category the "Transmission Licence". include turn, was defined which, "Transmission Licence" was defined as: "the transmission licence issued to the Seller under Part 12 of the Electricity Act by the Office of the Regulator-General on 3 October 1994 as amended on 7 August 1995 and 1 March 1996 and to be amended in accordance with the draft amendments included in the Data Room Documentation". 117 GPU Inc, a United States company, became the holding company for ATC at the time, and was designated as guarantor, but plays no role in the determination of this appeal. Bell The term "Total Purchase Price" mentioned in recital E was defined as: "$2,502,600,000 being the sum of the price of the Assets (including the Land) net of Contract Liabilities and Creditors (excluding Specified Creditors) assumed under this agreement and, for the avoidance of doubt, does not include the Estimated Duty. The sum of $2,502,600,000 is fixed, notwithstanding that the components referred to above may be shown collectively to have a different value." Clause 2.1 of the Asset Sale Agreement required that, subject to the terms of the agreement, on the "Completion Date", a date not earlier than 6 November 1997, the Seller was required to sell the Assets (excluding the Land) and the Buyer was required to: "(1) buy the Assets (excluding the Land); assume the Creditors (except the Specified Creditors) and the Contract Liabilities; pay the Total Purchase Price to the Seller". The term "Creditors" was defined expansively. It included "all persons to whom are owed amounts, debts, obligations and liabilities, whether currently owed or prospectively or contingently owing by the Seller". Under cl 4.2(c)(1), at completion118 the Seller was required to deliver to the Buyer the Transmission Licence, transferred so that the Buyer replaced the Seller as the licensee. If any party were to fail to pay any sum payable by it under the agreement at the time and otherwise in the manner provided in the agreement, that party was required to pay interest on that sum at a "Base Rate" plus two per cent. It was a condition precedent to completion that the State, the Seller and the Buyer would procure that the Office of the Regulator-General approve the transfer of the Transmission Licence from the Seller to the Buyer with effect from completion119. It was also a condition precedent that the State would procure the publication in the Government Gazette of an Order in Council declaring that the Buyer was a transmission company for the purposes of the 118 Defined to mean "completion of the sale and purchase of the Assets and the assumption of Creditors and Contract Liabilities under clause 2". 119 Asset Sale Agreement, cl 4.3(a). Bell Electricity Act, to take effect when the Buyer held a licence to transmit electricity issued under Pt 12 of the Electricity Act120. The term "Licence Fee Order" was defined as "the order in substantially the form set out in annexure G", which reflected the terms of the Order in Council made following the execution of the agreement. It was a further condition precedent to completion that the State would procure publication in the Government Gazette of the Licence Fee Order121. An important clause in the agreement was cl 7, which provided under the heading "ASSUMPTION OF LIABILITIES AND CREDITORS": "Following Completion, the Buyer assumes with effect from Completion all liabilities of the Seller to the Creditors, including without limitation the Contract Liabilities, other than the Specified Creditors and agrees to pay all Creditors other than the Specified Creditors in the normal course of business for obligations of the Seller existing before or after Completion." Given the definition of "Creditors" in the Asset Sale Agreement, the obligation thus assumed embraced PNV's contingent liability, which existed when the agreement was signed, to pay the charges imposed by the Order in Council when they fell due. AusNet's submissions to the contrary should be rejected, as should its submission that the Asset Sale Agreement did not otherwise impose upon it a contractual liability to pay the charges under the Order in Council. The contractual liability was imposed by cl 13.3(d) of the agreement. Clause 13.3(d) provided that the Buyer acknowledged and agreed with the State and the Seller that: the amounts to be payable by the Buyer pursuant to the Licence Fee Order are an integral part of the regulatory framework of the industry and the Buyer accepts that it must pay the amounts set out in the Licence Fee Order in order to carry on the Business transferred from the Seller; the Buyer must not challenge the validity of the Licence Fee Order or the amounts, or the basis of calculating the amounts, specified in the Licence Fee Order; 120 Asset Sale Agreement, cl 4.3(b). 121 Asset Sale Agreement, cl 4.3(d). Bell the Buyer agrees to pay to the Treasurer the amounts specified in the Licence Fee Order in accordance with the terms of, and at the times specified in, the Licence Fee Order, whether or not the Licence Fee Order is valid or enforceable; and the Buyer may not transfer the Transmission Licence or allow any person to become a licensee under the Transmission Licence unless the proposed licensee has first delivered to the State a covenant (in form and substance satisfactory to the State) agreeing to be bound by this clause 13.3(d) as if it were the Buyer." AusNet submitted that cl 13.3(d) confirmed that the Order in Council was the source of its liability to pay the charges which it imposed. The promise in cl 13.3(d)(3) to pay the charges "whether or not the Licence Fee Order is valid or enforceable" was said to be operative only if the Order in Council were found to be invalid or unenforceable. That submission cannot be accepted. The promise was unconditional. Its effect and evident purpose was to provide to PNV and the State certainty that the charges would be paid even if they turned out not to have been validly imposed. The promise was consideration moving from AusNet under the Asset Sale Agreement and was necessary to secure not only the Transmission Licence but the other assets that were the subject of the sale. Central to AusNet's case on characterisation was its proposition that the Total Purchase Price, which did not include the s 163AA charges, was the amount expended by AusNet in order to acquire the Assets. It was said the licence fees were not described in recital E of the agreement as forming part of the total value to be attributed to the Assets. They were described in recital F as "future licence fees ... payable by the Buyer". Invoking the language of Commissioner of Taxation v Morgan, AusNet said "[t]he price remains fixed. The payment of the [s 163AA imposts] is separate". Commissioner of Taxation v Morgan, however, is not apposite. The charges imposed under s 163AA cannot be viewed in the same way as an adjustment of municipal and water rates on the sale of land. Such rates are recurrent charges connected with the provision of public services. Their adjustment as between vendor and purchaser is time dependent. The imposts under s 163AA were significant liabilities not inherently recurrent and able to be imposed at such times and in such manner as are "specified" in the exercise of power conferred by that provision. They were a significant part of the consideration moving from AusNet for the acquisition of the Assets. The designation of an amount as the Total Purchase Price to be paid to PNV, as distinct from the licence charges to be paid to the State, does not relegate the payment of those charges to some lesser, incidental purpose. From the perspective of AusNet, "from a practical and business point of view", they were part of the consideration moving from it for the acquisition of the Assets. Bell Submissions by AusNet about the characterisation of the charges made reference to their purpose, as set out in the reasons for judgment of the primary judge. That rationale is explained in the following section. The rationale of the Order in Council Section 158A(1)(c) of the Electricity Act provided for the making of Orders in Council to "regulate, in such manner as the Governor in Council thinks fit ... charges for connection to, and the use of, the transmission system". A Tariff Order, made pursuant to s 158A on 20 June 1995, prescribed charges to be levied by PNV for certain network and connection services. It also imposed a cap on the revenue which PNV could derive from the provision of defined network and connection services and augmentation to the system and connection facilities. The cap on PNV's gross revenue for each financial year was designated the Maximum Allowable Revenue ("MAR"). That figure was the product of a specified Maximum Allowable Charge and forecast Summer Maximum Demand. The MAR was calculated by reference to efficient levels of operating and maintenance costs, a return on capital and straight line depreciation at rates reflecting estimated useful lives on a Current Cost Accounting asset base. The charges were fixed so that PNV would recover the cost of its assets over time and its operating and maintenance costs and would gain a return on its capital122. The tariff fixed in each year after the first was to be adjusted by reference to the Consumer Price Index less a factor designated "X", which was a proxy for the expected real rate of improvement in efficiency. Between the making of the Tariff Order on 20 June 1995 and the time that PNV was privatised in 1997, the State Government decided to extend the Tariff Order applicable to that company for a further two years in order to provide some price certainty for its prospective purchasers. However, the Government was advised that some of the assumptions upon which the Tariff Order was based were no longer correct. The prescribed MAR was higher than that necessary to yield a reasonable return on capital. Amending the "X" factor would avoid a windfall to PNV or its acquirer by lowering permitted transmission charges. The problem with that approach was that reduction of the transmission charges would provide a windfall for distributors123. To overcome that problem, the State Government was advised that the excess revenue which would accrue to PNV or its purchaser before the Tariff Order lapsed in December 2000 should be 122 The return on capital was assessed using the Optimised Depreciated Replacement Cost value of assets multiplied by a weighted average cost of capital. 123 The tariffs charged by distributors were fixed for the period to 31 December 2000. Bell recovered by the imposition of a "special licence fee". The fee could be separately invoiced and levied by imposition of a charge under s 163AA of the Electricity Act. The Treasurer of Victoria agreed that the Tariff Order applicable to PNV or its purchaser after December 2000 should be varied by increasing the "X" factor for 2001 and 2002. The additional charges under s 163AA were imposed for the preceding years. An information memorandum to prospective bidders for PNV's assets foreshadowed charges that would be imposed by an Order in Council made under s 163AA of $50,000,000 per annum for each of the years ending 30 June 1998 to 30 June 2000 and a further $40,000,000 for the six months ending 31 December 2000. In its successful bid made on 10 October 1997 for the acquisition of the PNV assets, AusNet requested that the proposed charges be changed to reflect the fact that the sale would take place after the first quarter of the financial year ending 30 June 1998. As appears below, the purpose for which the charges were imposed does not determine the character of the payments made by AusNet as holder of the Transmission Licence. The characterisation of the AusNet payments AusNet advanced six propositions, some of which overlapped, against characterisation of AusNet's payments of the s 163AA charges as being of a capital nature. First, it said that the purpose for which the charges were imposed informed the inquiry into the character of the advantage sought from AusNet's perspective in making the payments. Undue emphasis on the purpose of the charges, however, is apt to direct the inquiry away from the critical question — from AusNet's perspective what was the character of the advantage sought? — or, as Fullagar J put it in Colonial Mutual Life, what was the money really paid for? The answer to that question has already been reached. AusNet did not pay the charges in order to reimburse the State for excess revenue it might generate as licence holder. From a practical and business point of view, the assumption of the liability to make the expenditure was calculated to effect the acquisition of the Transmission Licence and the other assets the subject of the Asset Sale Agreement. The Transmission Licence was an intangible asset, but was properly viewed as part of the structure of the business. Without it, acquisition of the rest of the assets was pointless. If it were revoked after acquisition, the whole business structure would collapse. The second proposition was that the charges were a tax imposed not upon AusNet specifically but upon whoever was the licence holder. AusNet argued that its liability did not arise until after it had acquired the Transmission Licence and that it acquired nothing by making the payments. This was analogous to the Bell approach of Barwick CJ in Cliffs International to the royalties paid on iron ore mined by the taxpayer. Whether or not the charges were a tax, that submission should be rejected. AusNet's assumption of the fixed and ascertained statutory liabilities and its contractual promise to pay the charges, whether or not they were validly imposed, was consideration moving from it, prior to and for the acquisition of the licence and the other assets. The third submission, related to the second, was that the liability to pay the charges did not arise upon the execution of the Asset Sale Agreement in October 1997. That proposition did not advance the case any further than the second proposition. Fourthly, AusNet submitted that the charges were not part of the Total Purchase Price and therefore not part of the payment it made "for" the acquisition of the transmission business. For the reasons already given, that submission, which relied in part upon the decision of this Court in Commissioner of Taxation v Morgan, is also rejected. The fifth proposition was that the Asset Sale Agreement did not impose any contractual liability upon AusNet to pay the s 163AA charges. That submission has already been rejected in the discussion of the terms of the Asset Sale Agreement. The final submission was that liability to pay the charges was contingent upon AusNet continuing as the holder of the Transmission Licence at the particular times the charges were due for payment pursuant to the Order in Council. AusNet could, at any time, have transferred the Transmission Licence and avoided future liability to pay the charges. However, as the Commissioner submitted, upon Completion of the Asset Sale Agreement, AusNet was under a present legal obligation to make the payments at the times specified in the Order in Council. No further or other matter was necessary for the liability to crystallise. The case was distinguishable from Cliffs International, where the relevant royalty payments were contingent upon the removal of iron ore from the relevant reserves124. Conclusion For the preceding reasons, the charges paid by AusNet were of a capital nature. The primary judge and the majority in the Full Court were correct so to conclude. The appeal should be dismissed with costs. 124 (1979) 142 CLR 140 at 149 per Barwick CJ, 175 per Jacobs J, 176 per Murphy J. GAGELER J. The distinction between expenditure that is an outgoing of a capital nature and expenditure that is an outgoing of a revenue nature is sufficiently stated for present purposes as "the distinction between the acquisition of the means of production and the use of them"125. The distinction "depends on what the expenditure is calculated to effect from a practical and business point of view"126. To characterise expenditure from a practical and business perspective is not to disregard the legal nature of any liability that is discharged by the making of that expenditure127. It is not to inquire into whether the expenditure is similar or economically equivalent to expenditure that might have been incurred in some other transaction128. It is to have regard to the "whole picture" of the commercial context within which the particular expenditure is made129, including most importantly the commercial purpose of the taxpayer in having become subjected to any liability that is discharged by the making of that expenditure130. It is, where necessary, to "make both a wide survey and an exact scrutiny of the taxpayer's activities"131. Adopting the abbreviations used in the joint reasons for judgment, the precise question here is as to the characterisation of the expenditure made by AusNet in three subsequent income years in discharge of its legal liability which then existed by virtue of the Order in Council having been made in 1997 under 125 Hallstroms Pty Ltd v Federal Commissioner of Taxation (1946) 72 CLR 634 at 647; [1946] HCA 34. 126 Hallstroms Pty Ltd v Federal Commissioner of Taxation (1946) 72 CLR 634 at 648; BP Australia Ltd v Federal Commissioner of Taxation (1965) 112 CLR 386 at 397; [1966] AC 224 at 264. 127 GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 137; [1990] HCA 25. 128 City Link Melbourne Ltd v Commissioner of Taxation (2004) 141 FCR 69 at 83 [42], affirmed in Federal Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 CLR 1; [2006] HCA 35. 129 BP Australia Ltd v Federal Commissioner of Taxation (1965) 112 CLR 386 at 399; [1966] AC 224 at 267. 130 GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 137. 131 Western Gold Mines NL v Commissioner of Taxation (WA) (1938) 59 CLR 729 at 740; [1938] HCA 5. s 163AA of the Electricity Act. Was that expenditure merely a cost to AusNet of holding or using the Transmission Licence during those income years so as to be an outgoing of a revenue nature, or was it part of the cost to AusNet of securing acquisition of the Transmission Licence and other assets from PNV in 1997 so as to be an outgoing of a capital nature? The question cannot be answered, as AusNet seeks to have it answered, either by attempting to liken the expenditure to a simple case of a payment of land tax132 or an adjustment for rates made on the settlement of a contract for the sale of land133, or by attempting to liken the expenditure to the contractual payments which gave rise to the division of opinion in the peculiar circumstances considered in Cliffs International Inc v Federal Commissioner of Taxation134 or in Federal Commissioner of Taxation v Citylink Melbourne Ltd135. Those cases can be taken to illustrate the negative proposition that the fact that a promise to make the expenditure formed part of the consideration for the acquisition of an asset does not foreclose the question of whether the expenditure when made is calculated to effect the acquisition of the asset. Other considerations – including the frequency of the expenditure, the circumstances in which it is to be paid and the method by which it is to be calculated – might yet lead to the conclusion that the expenditure when made is more appropriately to be characterised from a practical and business perspective as referable to the subsequent use of the asset or to some other circumstance. Beyond that, I do not think that there is any general proposition to be taken from them. "The proper conclusion in each case in this particular area of the law", Barwick CJ observed as a member of the majority in Cliffs, "is peculiarly dependent upon the particular facts and circumstances of that case."136 Writing for the majority in Citylink, Crennan J made the same point when she endorsed the observation that there was "danger in arguing by analogy"137. Utilising for the moment the language in recital F of the Asset Sale Agreement, I accept the central argument of AusNet that it is insufficient to 132 Cf Moffatt v Webb (1913) 16 CLR 120; [1913] HCA 13. 133 Cf Commissioner of Taxation v Morgan (1961) 106 CLR 517; [1961] HCA 64. 134 (1979) 142 CLR 140; [1979] HCA 8. 135 (2006) 228 CLR 1. 136 (1979) 142 CLR 140 at 148. 137 (2006) 228 CLR 1 at 43 [151]. characterise the expenditure as an outgoing of a capital nature that the expenditure was part of the total payments made by AusNet to the State of Victoria "in connection with" AusNet's acquisition of the Transmission Licence and other assets from PNV. But to accept that argument is not to answer the question of characterisation; much less is it to characterise the expenditure as other than an outgoing of a capital nature. In my view, from a practical and business perspective, the expenditure was expenditure which AusNet was required to make in order to acquire the Transmission Licence and other assets. It was a component of AusNet's cost of the acquisition; it was part of the price AusNet had to pay. Of course, AusNet would not have ended up paying it unless AusNet remained the holder of the Transmission Licence during the subsequent income years. But it was not a cost which AusNet bore in order simply to use the Transmission Licence during those income years. That answer to the question of the characterisation of the expenditure does not depend on construing the Asset Sale Agreement to impose a contractual obligation on AusNet to make the expenditure, although it is none the worse for such a construction of the Asset Sale Agreement. In relation to the Asset Sale Agreement, it is enough for me to state that I agree with the joint reasons for judgment that cl 13.3(d) on its proper construction imposed a contractual obligation on AusNet to make the expenditure which was independent of the statutory liability imposed on AusNet under s 163AA of the Electricity Act. I do not think it necessary to consider the submission of the Commissioner of Taxation that AusNet had an additional and concurrent contractual obligation to make the expenditure under cl 7 of the Asset Sale Agreement. What I consider to be more important to answering the question of characterisation is an analysis of the structure and commercial context within which AusNet's statutory liability to make the expenditure came to be imposed. That statutory liability was imposed during the subsequent income years by s 163AA(2) of the Electricity Act, by virtue of the continuing existence during those years of the Order in Council made under s 163AA(1) in 1997. The statutory liability so imposed under the Electricity Act was not structured as a periodic payment referable simply to the holding of the Transmission Licence; it did not resemble a "fee" or "charge" payable to the Office of the Regulator-General under s 163(2) of the Electricity Act138. Nor was it structured in the usual way of a "tax"; it was not payable to the State and recoverable by the Commissioner of State Revenue under the Taxation Administration Act 1997 (Vic). It was structured instead as an "impost", 138 Section 163(3)(a) of the Electricity Act. relevantly payable by the holder of the Transmission Licence to the Treasurer in amounts and at times specified in the Order in Council. Whether, as so structured, it might also answer the description of a "tax" for constitutional purposes might be a nice question were it ever to arise139. It does not arise here. Part 12 of the Electricity Act was amended in 1997 to make s 163AA applicable to a "transmission company"140, for the express statutory purpose of providing for the "corporatisation and privatisation" of PNV141. By the time the Order in Council was made later in 1997 under s 163AA(1), it was apparent that the privatisation of PNV would take the form of a sale of the assets of PNV rather than a sale of the shares in PNV. In contemplation of that sale of assets, the Order in Council was expressed to apply to PNV, as the holder of the Transmission Licence, to a transferee of the Transmission Licence, and in the alternative to the holder of another licence who might "acquire all or substantially all the business" of PNV. The gazettal of the Order in Council in those terms was, by operation of cl 4.3(d), a condition precedent to the completion of the Asset Sale Agreement. The prospective statutory liability of AusNet to pay the imposts to the Treasurer in the three subsequent income years was in that way established in 1997, in advance of, and with a view to, AusNet's acquisition of the assets of PNV. It was a prospective liability to which AusNet had to subject itself in 1997 if AusNet was to secure that acquisition. The expenditure AusNet then made by way of payment of the imposts to the Treasurer was expenditure which AusNet was required to make to the State as a result of having made that acquisition. That the Transmission Licence might ultimately have been revoked if AusNet failed to pay the imposts142 does not convert the expenditure into a cost to AusNet merely of holding or using the Transmission Licence. The method by which the amounts and timing of the imposts specified in the Order in Council was determined does not point to a different conclusion. It 139 Cf Air Caledonie International v The Commonwealth (1988) 165 CLR 462 at 467; [1988] HCA 61; Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 336; [1989] HCA 47. 140 Section 24 of the Electricity Industry (Miscellaneous Amendment) Act 1997 (Vic). 141 Section 1(b) of the Electricity Industry (Miscellaneous Amendment) Act 1997 (Vic). 142 Section 35 of the Office of the Regulator-General Act 1994 (Vic) and s 164(3) of the Electricity Act. is correct, as AusNet submits, that the "purpose and effect" of the imposts was to enable the State to recover from AusNet the "excess amount of gross revenue" which AusNet was projected by the State to be likely to earn from the use of the assets which AusNet was to acquire from PNV in light of the belated realisation that the "X" factor in the "CPI minus X" calculation of the revenue cap had been set too low. But it is not really correct for present purposes to characterise that effect, as AusNet seeks to do, as being to "reset" the revenue cap. The revenue cap was to remain unaltered. The revenue cap remaining unaltered, but the "X" factor having been set too low, AusNet was projected to earn significantly higher returns from the use of the assets it was acquiring from PNV in the three subsequent income years. The effect of the imposts was to require AusNet to disgorge to the State the estimated amount of those projected additional returns. In order to acquire the assets of PNV in 1997, AusNet was required to submit in advance to an obligation to remit to the State the estimated amount of above-normal returns it would earn from the use of those assets in the three subsequent years. From a practical and business perspective, that is to my mind the long and the short of it. If an analogy were to be sought in the decided cases in this Court (and I do not suggest that it is necessary that one should be found), perhaps the closest analogy is Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation143, to which Edmonds and McKerracher JJ both referred in the decision under appeal144. There, land was sold to an insurance company on terms which required the company to erect a building on the land, to use its best endeavours to lease parts of the building, and to pay to the vendors for a period of 50 years 90% of all rents collected. The subsequent periodical payments of that proportion of rents by the insurance company to the vendors were held to constitute outgoings of a capital nature. Fullagar J, with whom Kitto and Taylor JJ agreed145, said it was "incontestable" that those payments were made "in order to acquire a capital asset", and continued146: "The documents make it quite clear that these payments constitute the price payable on a purchase of land, and that appears to me to be the end of the matter. It does not matter how they are calculated, or how they are payable, or when they are payable, or whether they may for a period cease 143 (1953) 89 CLR 428; [1953] HCA 68. 144 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation (2014) 220 FCR 355 at 145 (1953) 89 CLR 428 at 460. 146 (1953) 89 CLR 428 at 454 (emphasis in original). to be payable. If they are paid as parts of the purchase price of an asset forming part of the fixed capital of the company, they are outgoings of capital or of a capital nature. It does not indeed seem to me to be possible to say that they are incurred in the relevant sense in gaining or producing assessable income or in carrying on a business – any more than payment of a ... lump sum payable on transfer. The questions which commonly arise in this type of case are (1) What is the money really paid for? – and (2) Is what it is really paid for, in truth and in substance, a capital asset?" "Here we have a transaction of a purely business nature, in which it may be safely assumed that two parties, bargaining on equal terms, had full regard to the value of the land and the probable value of the consideration. According to the documents the periodical payments are the price for which the land is being bought, and no reason can be suggested for not giving to the documents their full literal effect. The transaction might perhaps have taken a form under which parts of the total payments to be made were, or could be, treated as interest on deferred payments of a price. But it did not take any such form. As matters stand, the total of the payments is simply the total price of the land." Here, as there, we have a transaction of a purely business nature in which AusNet (on the one hand) and PNV and the State (on the other hand) can safely be assumed to have had full regard to the value of the assets which AusNet was acquiring from PNV. The imposts to be imposed through the making of the Order in Council were not held out by the State to be negotiable in the events which led up to the Asset Sale Agreement. The non-negotiable imposts were nevertheless plainly taken into account by AusNet in setting the additional amount it was prepared to bid as the "Total Purchase Price", which, when added with stamp duty and the imposts, came to be referred to in recital F of the Asset Sale Agreement as "the total payments to the State in connection with the privatisation of [PNV]". The amount AusNet was prepared to bid might well have been different had the revenue cap truly been "reset" and had the imposts not been imposed. But we are not concerned with hypotheticals. In the form in which the parties were content to enter into the transaction, the non-negotiable imposts and the additional amount which AusNet was prepared to bid and which the State was prepared to accept as the "Total Purchase Price" were together in a real commercial sense the price which AusNet committed to pay to the State in order to acquire the assets of PNV. For these reasons, I would dismiss the appeal with costs. 147 (1953) 89 CLR 428 at 459 (emphasis in original). Nettle NETTLE J. This is an appeal from a judgment of the Full Court of the Federal Court of Australia148. By majority (Edmonds and McKerracher JJ, Davies J dissenting), the Full Court dismissed an appeal from the Federal Court of Australia (Gordon J)149. Gordon J had rejected an appeal against the respondent Commissioner's disallowance of the appellant's claim to be entitled to deductions under s 8-1 of the Income Tax Assessment Act 1997 (Cth) ("the ITAA") for imposts paid to the State of Victoria pursuant to an Order made under s 163AA of the Electricity Industry Act 1993 (Vic) ("the EIA"). This appeal concerns whether the imposts are deductible from the appellant's taxable income. In brief summary, in 1997 the appellant purchased the assets of an electricity transmission business owned by the State of Victoria. Among the assets so purchased was an electricity transmission licence issued under s 163 of the EIA. Section 163 provided inter alia for an electricity transmission licence to be subject to such conditions as were determined by the Office of the Regulator-General, including conditions requiring the licensee to pay specified fees and charges in respect of the licence ("specified fees"). Over and above the specified fees, s 163AA of the EIA provided that the Governor in Council could, by Order, declare that further specified charges, or charges calculated in a specified manner, be payable by the licensee as an impost at the times and in the manner so determined ("specified charges"). Neither the specified fees imposed under s 163 nor the specified charges levied under s 163AA were expressed to be payable in exchange for holding the electricity transmission licence; but, perforce of cll 3.4 and 18 of the licence and s 35 of the Office of the Regulator-General Act 1994 (Vic), failure to pay the specified fees or the specified charges could have resulted in revocation of the licence150. Under the contract of sale, the appellant became the holder of the electricity transmission licence and as such liable to pay the specified fees and specified charges. In addition, the contract of sale expressly required the appellant to pay the specified charges to the State and to refrain from contesting their validity. The amount of the specified charges was also expressed to be a component of the "total payments to the State in connection with the privatisation of the Seller" but not part of the "Total Purchase Price" for the assets. 148 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation (2014) 220 FCR 355. 149 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation 2013 ATC ¶20-416. 150 Clauses 3.4 and 18 of the licence (and relevant definitions) and s 35 of the Office of the Regulator-General Act 1994 are set out in the appendix to these reasons. Nettle The appellant claimed that both the specified fees and the specified charges were deductible from its assessable income. The Commissioner did not dispute that the specified fees were deductible but rejected the claim for the specified charges. The basis of rejection was that the Commissioner conceived the specified charges to be payments out of taxable profits or alternatively paid on capital account. At first instance, Gordon J affirmed the Commissioner's position. Her Honour held that the specified charges were not incurred in gaining or producing assessable income and therefore were not deductible because they were paid out of taxable profits; and further or alternatively were not deductible because they were paid on capital account. On appeal to the Full Court, the majority held that the specified charges were incurred in gaining or producing assessable income but were not deductible because they were paid on capital account. Davies J, in dissent, agreed that the specified charges were incurred in gaining or producing assessable income but held that they were incurred on revenue account and thus deductible. The two questions which fall to be determined in this appeal are, therefore, whether the specified charges were incurred in gaining or producing assessable income and whether they were incurred on capital account. For the following reasons, it should be concluded that the specified charges were incurred in gaining or producing assessable income and they were not incurred on capital account. It follows that the specified charges were deductible from the appellant's assessable income and that the appeal should be allowed. The facts Until 1993, the State Electricity Commission of Victoria ("SECV") was responsible for most generation, all transmission and the majority of distribution and supply of electricity in Victoria. Early in October 1993, SECV was disaggregated into three new businesses: Generation Victoria, to undertake the generation of electricity; National Electricity (later called Power Net Victoria or PNV) to undertake the State-wide transmission of electricity; and Electricity Services Victoria, to undertake the distribution of electricity to consumers. The EIA came into full force on 3 January 1994. PNV was issued a transmission licence under Pt 12 of the EIA. Section 158A(1) of the EIA relevantly provided that the Governor in Council could, by Order published in the Government Gazette, regulate in such manner as the Governor in Council thought fit prices in respect of goods and services prescribed in respect of the electricity industry, including charges for connection to and use of the Nettle transmission system. Section 158A(2) provided that the charges could be set by reference to certain factors, including a general price index or caps on revenue. The Tariff Order On 20 June 1995, an Order ("the Tariff Order") was made under s 158A imposing, amongst other things, a cap on the revenue which PNV could derive from the provision of "Prescribed Services"151. The object of the Tariff Order generally, and the revenue cap in particular, was to limit PNV's ability to exploit its natural monopoly over network and transmission services by increasing prices. The Tariff Order provided that PNV's maximum allowed revenue ("MAR") in respect of the supply of the Prescribed Services for each financial year ("t") was to be calculated according to the following formula152: MARt = MACt x SMDt where: "MACt" (in $/kW) represented the maximum average charge ("MAC") in financial year t that PNV could charge for the capacity to transmit one kW of electricity at the forecast summer maximum demand ("SMD"); and "SMDt" (in kW) represented the forecast SMD for the financial year t. The SMD for each financial year up to 30 June 2005 was specified in the Tariff Order. The revenue cap was calculated to reflect efficient levels of operating and maintenance costs (which were estimated to be a percentage of the replacement cost value of assets); a return on capital equal to the optimised depreciated replacement cost value of assets multiplied by a weighted average cost of capital; and straight line depreciation at rates reflecting estimated useful lives on current cost accounting asset base. The Tariff Order provided a mechanism by which the MAC was to be adjusted each financial year by multiplying the previous year's MAC by 151 "Prescribed Services" were network services relating to the system existing at 3 October 1994, which PNV supplied to VPX; connection services relating to the connection facilities existing at 3 October 1994, which PNV supplied to distributors, generators and traders; and certain specified augmentations to the transmission system in the period up to 30 June 2000. 152 Subject to limited exceptions for transitional purposes. Nettle (CPI − X). CPI referred to the Consumer Price Index, a proxy for inflation. The "X factor" was a fixed integer calculated to reflect expected annual efficiency gains. Consequently, in order to increase its profits in real terms, PNV had to make annual efficiency improvements in excess of the X factor. Privatisation of PNV In April 1997, the Victorian Government announced its intention to privatise PNV and, around the same time, the Government undertook a review of the Tariff Order. As a result of the review, it was determined that the X factor applicable to PNV would not be appropriate to a private transmission company. Rather than reset the X factor, however, which would have required amending the Tariff Order for the period up to 31 December 2000, the Government determined to impose additional charges to recover the difference between the gross revenue that would accrue to PNV under the Tariff Order as it stood and the MAR which Government modelling suggested would be derived if the X factor were modified appropriately. Section 163AA of the EIA was thus enacted to facilitate the imposition of the additional charges as specified charges153. The Government explained the intended effect of the specified charges in an "Information Memorandum for the Proposed Sale of PowerNet Victoria", dated August 1997 ("the Information Memorandum"), as follows: "1.4.1 PowerNet's Operations and Market Position Incentive Based Regulatory Regime PowerNet operates under an incentive based regulatory regime whereby its maximum allowed revenue ('MAR') in respect of the existing network and certain prescribed augmentations is subject to annual escalation based on the application of a CPI-X factor to the previous period's maximum average charge ('MAC') per kW of forecast summer maximum demand ('SMD') and any increase in forecast SMD ... As the CPI-X regulatory regime applies to PowerNet's revenue and not its profits, PowerNet will retain the benefit of any productivity gains during the regulatory period in excess of those assumed in setting the X factor (except rules apply). Furthermore, any efficiency gains earned by PowerNet above the levels assumed are to be adjusted progressively over the subsequent regulatory limited circumstances, where specific 153 Electricity Industry (Further Amendment) Act 1995 (Vic), s 13. Nettle period and in a manner which ensures that such efficiency gains are fairly shared between PowerNet and its customers. It is expected that there will be a number of opportunities for PowerNet to achieve productivity gains in excess of those assumed in setting the X factor." The Information Memorandum explained how the X factor would be "effectively reset" for the period ending 30 June 2001 by the imposition of the specified charges under s 163AA as follows: "2.4.2 Specified Charges on Holder of Transmission Licence It is intended that an Order will be made pursuant to section 163AA of the Electricity Industry Act imposing the following specified charges on the holder of the PowerNet transmission licence ... of: $50 million per annum for each of the years ending 30 June 1998 through 2000; and $40 million for the year ending 30 June 2001. The specified charges will be fixed amounts and payable quarterly in arrears for each financial year to 30 June 2000 and equal instalments payable on 30 September and 31 December 2000, in respect of the year ending 30 June 2000 [scil 2001]. It is intended that charges under section 163AA will not be imposed from 31 December 2000. 2.4.4 Background to Revised Revenue Controls and the [Specified Charges] The Tariff Order currently specifies that an X-factor of 1.79% will apply to 31 December 2000. PowerNet's revenue caps have effectively been reset through the [specified charges] and the new X-factor for 2001 and 2002. This approach to re-setting the revenue caps was adopted: due to constraints imposed by the Maximum Uniform Tariffs which the [distributors] can charge franchise customers and which currently apply to consumers without revision to 31 December 2000; and to avoid any windfall gains accruing to PowerNet and its customers which may result from the re-set." Nettle Sale of the assets of PNV to the appellant On 12 October 1997, the appellant154 entered into the contract of sale with PNV, the Treasurer on behalf of the Crown in right of the State of Victoria and GPU Inc (a guarantor) to purchase the assets and undertaking of PNV including PNV's transmission licence ("the Asset Sale Agreement"). The recitals to the Asset Sale Agreement provided as follows: "A. The Seller [PNV] is the owner of the Assets. The Seller agrees to sell and the Buyer [the appellant] agrees to buy the Assets ... on the terms and conditions set out in this agreement. The total value attributed by the parties to the sale of Assets (net of Creditors and Contract Liabilities) the subject of this agreement is $2,555,000,000 made up of: Total Purchase Price Estimated Duty The parties agree that the total payments to the State in connection with the privatisation of the Seller are $2,732,500,000 (including future [specified charges] of $177,500,000 payable by the Buyer, which the State values in net present value terms at approximately The "Total Purchase Price" was relevantly defined as "$2,502,600,000 being the sum of the price of the Assets ... net of Contract Liabilities and Creditors ... assumed under this agreement". Clause 4.3 of the Asset Sale Agreement provided that completion was subject to a number of conditions precedent, including that: 154 At the time it entered the contract, the appellant's corporate name was Australian Transmission Corporation Pty Ltd. It was renamed GPU PowerNet Pty Ltd on 30 October 1997 and SPI PowerNet Pty Ltd on 2 July 2000, and acquired its present name in 2014. Nettle the State, the Seller and the Buyer shall procure that the Office of the Regulator-General approves the transfer of the Transmission Licence from the Seller to the Buyer with effect from Completion; the State shall procure the publication in the Government Gazette of an Order in Council declaring that the Buyer is a transmission company for the purposes of the [EIA], to take effect when the Buyer holds a licence to transmit electricity issued under Part 12 of the [EIA]; the State shall procure the publication in the Government Gazette of the [specified charges] Order ..." Clause 4.4 provided for the appellant, upon completion, to pay the Total Purchase Price (plus interest, less deposit) to PNV and any duty owed to the State. Clause 13.3 set forth a number of warranties and acknowledgments by the appellant including, in cl 13.3(d), the following relating to the specified charges: the amounts to be payable by the Buyer pursuant to the [specified charges] Order are an integral part of the regulatory framework of the industry and the Buyer accepts that it must pay the amounts set out in the [specified charges] Order in order to carry on the Business transferred from the Seller; the Buyer must not challenge the validity of the [specified charges] Order or the amounts, or the basis of calculating the amounts, specified in the [specified charges] Order; the Buyer agrees to pay to the Treasurer the amounts specified in the [specified charges] Order in accordance with the terms of, and at the times specified in, the [specified charges] Order, whether or not the [specified charges] Order is valid or enforceable; and the Buyer may not transfer the Transmission Licence or allow any the Transmission Licence person to become a licensee under unless the proposed licensee has first delivered to the State a covenant (in form and substance satisfactory to the State) agreeing to be bound by this clause 13.3(d) as if it were the Buyer." The specified charges On 28 October 1997, the Governor in Council made the following Order under s 163AA of the EIA declaring the specified charges payable by PNV to the Nettle Treasurer for payment into the Consolidated Fund in respect of PNV's licence ("the Order"): "The Governor in Council acting on the recommendation of the Treasurer under Section 163AA(1) of the Electricity Industry Act 1993 declares that the amounts payable as an impost by Power Net Victoria, as the holder of a licence (the 'Transmission Licence') to transmit electricity issued under Part 12 of the Electricity Industry Act 1993, to the Treasurer for payment into the Consolidated Fund under Section 163AA(2) of the Electricity Industry Act 1993, are as follows: $37,500,000 in respect of the financial year ending 30 June 1998, payable in arrears in two instalments, being $25,000,000 on 31 March 1998 and $12,500,000 payable on 30 June 1998; $50,000,000 in respect of each of the financial years ending 30 June 1999 and 30 June 2000, payable in arrears in four equal instalments on 30 September, 31 December, 31 March and 30 June in each relevant financial year; and $40,000,000 in respect of the 6 months ending on 31 December 2000, payable in arrears in two equal instalments on 30 September 2000 and 31 December 2000. This Order applies to any person or persons (jointly and severally) to whom the Transmission Licence is transferred or any subsequent holder of the Transmission Licence or any person or persons (jointly and severally) who acquire all or substantially all the business of Power Net Victoria and who is or are issued with a licence to transmit electricity under Part 12 of the Electricity Industry Act 1993." On completion on 6 November 1997, the appellant paid the amounts provided for in cl 4.4 and subsequently paid specified charges totalling $177,500,000 levied under the Order, as follows: Year of income ended 31 December 1998 Year of income ended 31 December 1999 Year of income ended 31 December 2000 The specified charge payable in respect of the financial year ended 30 June 1998 was $37,500,000, rather than the $50,000,000 provided for in the Information Memorandum, because, in the events which occurred, the Order did not take effect until after the first quarter of that financial year. Nettle The claim for deductions In brief summary, the transaction by which the appellant acquired the assets of PNV and the liability to pay the specified charges had the following features: The appellant contracted to buy the assets of PNV, which included the transmission licence necessary to carry out the business. (2) An incident of carrying out the business was the Tariff Order, which included the revenue cap that regulated the price at which Prescribed Services could be provided. The specified charges were imposed to reflect a reconsideration of the assumptions that underpinned the calculation of the revenue cap for certain years. The obligation to pay the specified charges was imposed on the holder of the transmission licence. The specified charges were payable to the State over and above the purchase price for the assets, including the transmission licence. The specified charges were payable from time to time, according to the schedule set out in the Order. (7) Under the Asset Sale Agreement, the appellant acknowledged that it must pay the specified charges as an "integral part of the regulatory framework of the industry", and it warranted that it would pay the specified charges to the State without challenging their validity. In its amended tax returns for the 1998, 1999 and 2000 years of income, the appellant claimed the amounts so paid in each year of income as a deduction pursuant to s 8-1 of the ITAA. Section 8-1 relevantly provides: "8-1 General deductions (1) You can deduct from your assessable income any loss or outgoing to the extent that: it is incurred in gaining or producing your assessable income; or it is necessarily incurred in carrying on a business for the purpose of gaining or producing your assessable income. Nettle (2) However, you cannot deduct a loss or outgoing under this section to the extent that: it is a loss or outgoing of capital, or of a capital nature". Decisions below At first instance, Gordon J held that the specified charges were not incurred in gaining or producing assessable income because they were in substance and effect payments out of taxable profits155. Her Honour reasoned in similar fashion to Lockhart J's process of reasoning in United Energy Ltd v Commissioner of Taxation156. In United Energy, the taxpayer, an electricity distributor, claimed a deduction for franchise fees paid to the State of Victoria pursuant to an Order made under s 163A of the EIA. Lockhart J held that157: "Properly analysed the franchise fees are in reality akin to the State of Victoria taking a share of the profits from the [distributors] (in this case the applicant), leaving the applicant an amount determined by the Treasurer to be a reasonable return on the capital of the company used in deriving the income ... The residue is taken by the State as its share of profits; it has similar characteristics to a payment by way of dividend." In the present case, Gordon J applied similar reasoning as follows158: "As the Tariff Order provided (and the Information Memorandum recorded), the purpose of the Tariff Order was to regulate pricing of services – it imposed a cap on the revenue which could be derived from the provision of 'Prescribed Services' ... But the revenue cap in the Tariff Order was not limited to derivation of PNV's assessable income. The revenue cap in the Tariff Order was calculated to reflect three matters – efficient levels of operating and maintenance costs, a return on capital and straight line depreciation at rates reflecting estimated useful lives on Current Cost Accounting asset base ... The charges were set to enable PNV to recover the cost of its 155 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation 2013 ATC ¶20-416 at 156 (1997) 78 FCR 169. 157 (1997) 78 FCR 169 at 180. 158 SPI PowerNet Pty Ltd v Federal Commissioner of Taxation 2013 ATC ¶20-416 at Nettle assets over time (reflecting depreciation), to provide it with a return on capital (using the Optimised Depreciated Replacement Cost value of assets multiplied by a weighted average cost of capital) and to recover its estimated operating and maintenance costs ... Those elements necessarily included calculation of PNV's taxable income – revenue less estimated operating and maintenance costs and depreciation. Here the payments ... represented amounts to be derived by the licence holder from the provision of the 'Prescribed Services' that were over and above all capital and operating costs (including borrowing costs) and after allowing for an appropriate return to shareholders. As is apparent, although the integers in the calculation of the MAR and the [specified charges] were not disclosed in the express terms of s 163AA, the structure of the imposition of the franchise fee in s 163A and the [specified charges] under s 163AA was the same – in substance and effect, a share of the profits leaving the holder of the licence with an amount determined to be a reasonable return on the capital of the company deriving that income. The residue, or surplus, was taken by the State as its share of profits." On appeal to the Full Court, Edmonds J rejected that approach. He stated that he did not consider that it was enough to characterise an outgoing as a share of profits that one may be able to say that it was "'in reality akin' to a share of profits"159. In his Honour's view, the reasoning of Sundberg and Merkel JJ in United Energy was to be preferred160. He concluded that the specified charges were, however, outgoings of capital or capital in nature because the transmission licence was "unarguably a capital asset"161 and because the specified charges were "part of the cost of acquisition" of the transmission licence162: "Critically, the transfer of the Transmission Licence to [the appellant] carried with it the s 163AA liability of PNV; equally critically, the s 163AA impost was not made on [the appellant] post the transfer of 159 SPI PowerNet (2014) 220 FCR 355 at 359 [10]. 160 SPI PowerNet (2014) 220 FCR 355 at 359 [10]. Edmonds J also quoted with approval City Link Melbourne Ltd v Commissioner of Taxation (2004) 141 FCR 69 at 84-85 [48]. See also at 85-86 [49]-[52]. 161 SPI PowerNet (2014) 220 FCR 355 at 359 [12]. 162 SPI PowerNet (2014) 220 FCR 355 at 361 [18]. Nettle the Transmission Licence on Completion. The liability was assumed by [the appellant] on the transfer of the Transmission Licence, not by Order under s 163AA, and as such, forms as much part of the cost of acquisition of the Assets as the Total Purchase Price." Edmonds J noted that the decision of this Court in Cliffs International Inc v Federal Commissioner of Taxation163 was opposed to his conclusion. In Cliffs, the taxpayer agreed that, in consideration of the purchase of shares in a company which held a mining licence, the taxpayer would pay the vendors an initial lump sum and, in each year thereafter, 15 cents (US) per ton of ore mined from the licence area during that year. A majority of the Court (Barwick CJ, Jacobs and Murphy JJ, Gibbs and Stephen JJ dissenting) held that the payments of 15 cents per ton were paid on revenue account. Barwick CJ reasoned thus164: "[T]he fact that payments are made or received in performance of a promise given as part of the consideration for the acquisition of a capital asset does not necessarily mean that the payments are themselves of a capital nature. [The taxpayer's] promise to make the payments in the events which occurred formed part of the consideration given for the acquisition of the shares. But they were acquired without making the payments in question. The recurrent payments were not made for the shares though it might properly be said that they were payable as a consequence of the purchase of the shares. The vendors for the transfer of their shares took a cash price and stipulated for a share of the proceeds of mining iron ore, if that eventuated. For its part, the appellant by agreeing to make the recurrent payments was prepared to admit the vendors of the shares to participation in the result of the mining of the iron ore. They were made, and necessarily made, by the appellant as disbursements in its business. ... If an analogue is felt to be of assistance, an analogy may be found in the grant of a licence to use a patent upon payment of a cash price and a continuing royalty on what might be produced by employment of the patent. The promise to pay the royalties is, in my opinion, in such a case 163 (1979) 142 CLR 140; [1979] HCA 8. 164 Cliffs (1979) 142 CLR 140 at 148-151 (footnote omitted). Nettle part of the consideration for the grant of the licence but neither the receipt nor the payment of the royalty is for that reason a capital receipt or payment. The reasoning in Egerton-Warburton v Deputy Federal Commissioner of Taxation strongly suggests the conclusions at which I have arrived. The payments were, in my opinion, disbursements by the appellant in the course of its business and were not of a capital nature." To similar effect, Jacobs J reasoned as follows165: "[I]t is submitted [for the Commissioner that], in the case of a leasehold, where there is a sub-lease for a consideration in the form of recurrent payments, those payments are on revenue account but it is submitted that when there is an assignment for a consideration in the form of identical recurrent payments, those payments are on capital account. And the same is said of mining leases and other interests. In my opinion this distinction cannot be maintained so absolutely. It would mean that recurrent payments under a grant for the term less a day would be on revenue account but like payments under a grant of the term ... would be on capital account. ... Where the acquisition is of a depreciating right or advantage of limited duration the manner of remuneration of the transferor is inevitably a factor which largely determines whether that remuneration is deductible as a revenue outgoing. The best known example is the lease for a term of years where the consideration is a premium and a rental." Murphy J's reasoning, although much briefer, proceeded along similar lines166: "The question is to be decided from a practical and business point of view (see Dixon J in Hallstroms Pty Ltd v Federal Commissioner of Taxation). I am satisfied from a consideration of all the circumstances that the payments are not of capital or of a capital nature and that they are allowable deductions within s 51(1). The description given to the payments by the parties in their agreement is not decisive. The fact that payment of the outgoings was agreed as part of the consideration for the acquisition of a capital asset is not decisive. There is a strong analogy 165 Cliffs (1979) 142 CLR 140 at 172-174. 166 Cliffs (1979) 142 CLR 140 at 176 (footnote omitted). Nettle with an agreement to pay rent as part of the consideration for acquisition of a lease. The acquisition of the asset did not depend upon the payment of any 'deferred payment'. The 'deferred payments' if any were made, would be for currently exercising the right to mine the ore in pursuance of the agreement. The amount of deferred payments was indeterminate; the rate of 15 cents per ton was certain but the amount to be paid in any year or during the life of the agreement was uncertain and depended on the exercise of the rights to mine." Edmonds J said that he rejected the reasoning in Cliffs because he considered that the "[j]urisprudence both before and after Cliffs International does not support [Barwick CJ's] approach"167; Jacobs J was in error because, "[a]rguably, his Honour's focus was on the wrong asset" (being the mining tenements, rather than the shares in the company that held them)168; and Murphy J's approach was wrong because he treated the matter as analogous to an agreement to pay rent as part of the consideration for the acquisition of a lease and "the analogy with an agreement to pay rent as part of the consideration for acquisition of a lease, like many analogies, is apt to mislead"169. McKerracher J's judgment was to the same effect. Although his Honour stated that it would be too narrow an approach to confine the question to whether the payment of the specified charges was part of the purchase price170, ultimately his Honour rested his conclusion on the a priori proposition that171: "The provisions of the Asset Sale Agreement imposed a separate contractual liability to pay the [specified charges] in order to acquire the Assets, including the Transmission Licence. The payment was therefore a capital amount." 167 SPI PowerNet (2014) 220 FCR 355 at 361 [20]. 168 SPI PowerNet (2014) 220 FCR 355 at 362 [22]. 169 SPI PowerNet (2014) 220 FCR 355 at 362 [24]. 170 SPI PowerNet (2014) 220 FCR 355 at 370 [65]. 171 SPI PowerNet (2014) 220 FCR 355 at 371 [71]. Nettle McKerracher J referred172 without criticism to the majority judgments in Cliffs but, like Edmonds J, his Honour was evidently of opinion that the reasoning of the minority was preferable and that he was free to prefer it. Davies J did not refer to Cliffs or to whether expenditure promised as part of the consideration for the acquisition of a capital asset is necessarily an outgoing incurred on capital account. But, consistently with the majority's reasoning in Cliffs, her Honour approached the matter as follows173: "The obligation to pay the [specified charges] flowed as a necessary consequence of holding the licence, so that the thing that produced the assessable income was the thing that exposed [the appellant] to the liability discharged by the expenditure. The [specified charges] are therefore to be seen as an expense in the business operations of [the appellant] and on revenue account rather than as a cost in securing the right to conduct the transmission business." Davies J rejected the Commissioner's argument that cl 13.3(d) of the Asset Sale Agreement made a difference. Her Honour reasoned that, although the appellant bound itself "as part of the terms of the Asset Sale Agreement" to pay the specified charges174: "the occasion for the incurrence of the liability to make the payments pursuant to the Order was not clause 13.3(d) but the fact that [the appellant] was the holder of the licence when the amounts became payable." Outgoing incurred in gaining or producing assessable income By notice of contention the Commissioner sought to uphold the judgment of the Full Court on the basis that, although the majority rejected Lockhart J's method of reasoning in United Energy, his Honour's method of reasoning was sound and, applied to this case, led to the conclusion that the specified charges were not incurred in gaining or producing the appellant's assessable income because they were calculated by reference to the appellant's expected profits. That contention should be rejected. The majority of the Full Court were right not to follow Lockhart J's method of reasoning in United Energy. Principle and authority dictate that it does not follow from the fact that an obligation is 172 SPI PowerNet (2014) 220 FCR 355 at 368-369 [59]. 173 SPI PowerNet (2014) 220 FCR 355 at 378 [107] (citation omitted). 174 SPI PowerNet (2014) 220 FCR 355 at 378 [107]. Nettle paid or satisfied out of profits that the obligation may not have been incurred in gaining or producing assessable income175. The chief factor in the determination of the nature of expenditure is the character of the advantage which is sought to be obtained by it176. It is also necessary to have regard to the manner in which the acquisition is used or relied upon and the means which are adopted to obtain In this case, the appellant derived the bulk of its assessable income from the amounts which it received from the transmission of electricity in the form of Prescribed Services. It was able to transmit electricity by way of Prescribed Services in those years of income and so derive that assessable income only so long as it held the transmission licence. So long as it remained the licence holder, it was bound to pay the specified charges. The occasion for payment of the specified charges thus inhered in the use, on a regular and recurrent basis, of the means of production of the appellant's assessable income. Accordingly, the specified charges were incurred in gaining or producing assessable income. Equally, the specified charges were incurred in carrying on business for the gaining or producing of assessable income because they were appropriate and adapted to that end178. It follows that, unless the payments were properly to be characterised as incurred on capital account, they were deductible under s 8-1 of the ITAA. Outgoing incurred on capital account The appellant's submissions The appellant contended that the specified charges were not incurred on capital account because payment of the specified charges neither secured nor was 175 Emu Bay Railway Co Ltd v Federal Commissioner of Taxation (1944) 71 CLR 596 at 606 per Latham CJ; [1944] HCA 28; Federal Commissioner of Taxation v The Midland Railway Co of Western Australia Ltd (1952) 85 CLR 306; [1952] HCA 5; Nilsen Development Laboratories Pty Ltd v Federal Commissioner of Taxation (1981) 144 CLR 616 at 628 per Gibbs J; [1981] HCA 6. 176 GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 137 per Brennan, Dawson, Toohey, Gaudron and McHugh JJ; [1990] HCA 25. 177 Sun Newspapers Ltd v Federal Commissioner of Taxation (1938) 61 CLR 337 at 363 per Dixon J; [1938] HCA 73. 178 Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation (1953) 89 CLR 428 at 443 per Williams ACJ; [1953] HCA 68. Nettle capable of securing any lasting advantage. To suggest otherwise, it was said, would be to ignore the raison d'être of the specified charges, which was to deny the appellant a portion of the monopoly profits that would otherwise have flowed to it from its exploitation of the licence. The specified charges were not part of the consideration for the purchase of the licence because the Total Purchase Price of the assets, including the licence, was fixed; the specified charges were a separate matter. The specified charges were not incurred for the acquisition of the licence because, by the time the appellant came to pay the specified charges, it had already acquired the licence. The revenue character of the specified charges was revealed by the fact that the appellant's liability for each specified charge was contingent, both legally and commercially, upon the appellant remaining the holder of the licence at the time that the specified charges fell due. The appellant could have transferred the licence and thus avoided liability for future specified charges. So long as the appellant remained the licence holder, it was bound to pay each specified charge as it fell due, just as it was bound to pay each specified fee as it fell due. Otherwise, it would have been at risk of losing the licence. Each of the specified charges was therefore a regular and recurrent outgoing which inhered in the licence and was necessarily incurred in maintaining and exploiting the licence. Those submissions should be accepted. The Commissioner's submissions The Commissioner contended to the contrary that it necessarily followed from the proper construction of the Asset Sale Agreement that the specified charges were paid as part of the purchase price for the acquisition of capital assets, including the transmission licence. In the alternative, it was said that the circumstances of and surrounding the payments – the connection to the asset sale transaction and the means adopted to make the payments – led to the same result. The Commissioner also advanced a further, independent proposition that the payments secured an advantage of a capital nature in that the specified charges formed an "integral part of the regulatory framework" in which the business was to operate. The specified charges were a mechanism adopted to adjust the regulated revenue of the transmission company to ensure that the newly privatised business would enjoy an appropriate return in its initial years. Thus, it was said, the specified charges formed part of the profit-generating subject, akin to the franchise fees considered in United Energy. Those submissions should be rejected. The criteria of distinction In Hallstroms Pty Ltd v Federal Commissioner of Taxation, Dixon J said that he was not prepared to concede that the distinction between outgoings on revenue account and those of a capital nature is "so indefinite and uncertain as to Nettle remove the matter from the operation of reason and place it exclusively within that of chance"179. His Honour also stated that he did not accept that "the discrimen is so unascertainable that it must be placed in the category of an unformulated question of fact"180. But despite those observations and despite more than half a century of case law development since his Honour uttered them, the distinction remains elusive181. To a large extent it remains a truism that "each case in this particular area of the law is peculiarly dependent upon the particular facts and circumstances of that case"182. In Sun Newspapers Ltd v Federal Commissioner of Taxation, Dixon J identified the discrimen of the capital–income dichotomy as being the difference between expenditure on the acquisition of the profit-yielding subject and outlays on the process of operating the profit-yielding subject183. His Honour also described the tests by which expenditure may be assigned to one or other of those categories as turning upon the character of the advantage sought to be obtained, the manner in which it is to be used and the means adopted to obtain it184. In Hallstroms he added that the issue is to be decided from a practical and business point of view185. In Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation186, Fullagar J posed the question thus: what is the money really paid for – is what it is really paid for, in truth and in substance, a capital asset? According to those criteria, the fact that the result or purpose of expenditure is the acquisition of some right or advantage of a lasting character for the benefit of the profit-yielding subject is a necessary but not sufficient indication that the expenditure is incurred on capital account. The final classification of an outgoing as being on capital or revenue account depends on the manner in which the right or advantage is to be used and the means which are adopted to obtain it. 179 (1946) 72 CLR 634 at 646; [1946] HCA 34. 180 Hallstroms (1946) 72 CLR 634 at 646. 181 Cliffs (1979) 142 CLR 140 at 157 per Stephen J. 182 Cliffs (1979) 142 CLR 140 at 148 per Barwick CJ. 183 (1938) 61 CLR 337 at 359-360. 184 Sun Newspapers (1938) 61 CLR 337 at 363. 185 (1946) 72 CLR 634 at 648. 186 (1953) 89 CLR 428 at 454. Nettle Other things being equal, where the means of obtaining a right or advantage of a lasting character is the payment of a lump sum purchase price or the payment of a lump sum purchase price by instalments, the expenditure is properly treated as incurred on capital account. If, however, the means of securing the right or advantage is by making recurrent payments accruing de die in diem or at other intervals, like rent, the payments may in some cases be treated as incurred on revenue account187. Difficulties sometimes arise in deciding whether the means of acquisition of an asset or advantage are to be viewed as payments of a lump sum purchase price by instalments or as recurrent payments accruing de die in diem or at other intervals. As Dixon J remarked in Hallstroms, the courts have tended to proceed not so much with conspicuous analysis as with what his Honour described as the "traditional way of stating what positive factor or factors" in a given case lead to assigning the expenditure to one category or another188. Where there is a decided case in point, the problem can be resolved in accordance with precedent. But where there is no decided case in point, the problem must be resolved in accordance with principle, by induction and, therefore, ultimately by analogy. By way of illustration, if a property developer enters into an agreement to purchase land for a lump sum purchase price for redevelopment and subsequent retention as a long-term investment, there is no doubt that the payment of the purchase price is incurred on capital account. But what if the developer agrees that, instead of paying the purchase price, it will pay the vendor a share of the rents to be derived by the developer from the land once redeveloped? Apart from the decided cases, it might be open to classify the obligation to pay the share of rents either as an obligation to pay the purchase price by instalments or as an obligation to make recurrent payments accruing de die in diem or at other intervals. In view of the decided cases, precedent dictates that it should be classified as the former189. Similarly, suppose a taxpayer purchases land to be used as its place of business and agrees in consideration of the purchase that it will take over and meet a regular and recurrent obligation owed by the vendor to a third party. Apart from the decided cases, it might be open to classify the obligation either as an obligation to pay the purchase price by instalments or as an obligation to make 187 Sun Newspapers (1938) 61 CLR 337 at 363 per Dixon J. 188 (1946) 72 CLR 634 at 646. 189 Colonial Mutual (1953) 89 CLR 428 at 444 per Williams ACJ. Nettle recurrent payments accruing de die in diem or at other intervals. In view of the decided cases, precedent dictates that it should be classified as the former190. In contrast, since the lease of a shop at which a shopkeeper proposes to carry on business is an enduring asset and thus, once acquired, an accretion to the shopkeeper's profit-earning subject, absent precedent it would not be illogical to classify the shopkeeper's obligation to pay rent under the lease either as payment of the purchase price by instalments or as an obligation to make recurrent payments accruing de die in diem or at other intervals. In view of the decided cases, however, it is difficult to conceive of circumstances in which the rent should not properly be treated as an obligation incurred on revenue account191. In this case there is no decided case directly in point. Accordingly, it is necessary to proceed by induction from the decided cases. The task is to identify what it is in the decided cases which marks the distinction between a succession of payments that should properly be characterised as payments of purchase price by instalments and a succession of payments that should properly be characterised as satisfaction of a regular and recurrent obligation, like rent. Some of the cases imply that the criterion of distinction is whether an obligation to make payments is incurred as consideration for the acquisition of a capital asset192 as opposed to arising under or out of the operation of the capital asset once acquired193. Other cases show, however, that that is not a sufficient criterion of distinction where the obligation to make payments is incurred both as consideration for the acquisition of the asset and also under or arising out of the operation of the asset once acquired. An assignment of a lease of business premises illustrates the point. A shopkeeper seeking an assignment of the lease of shop premises might be required to covenant with the assignor and the landlord that, in consideration of the assignment, the shopkeeper will pay all rent and other outgoings as they accrue due under the lease. Despite the covenant, there could be little doubt that 190 Tata Hydro-Electric Agencies, Bombay v Income-tax Commissioner, Bombay Presidency and Aden [1937] AC 685 at 695. 191 Federal Commissioner of Taxation v South Australian Battery Makers Pty Ltd (1978) 140 CLR 645 at 653-655 per Gibbs ACJ; [1978] HCA 32. 192 See, eg, Colonial Mutual (1953) 89 CLR 428; Tata [1937] AC 685. 193 Egerton-Warburton v Deputy Federal Commissioner of Taxation (1934) 51 CLR 568; [1934] HCA 40; Commissioner of Taxation v Morgan (1961) 106 CLR 517; [1961] HCA 64; Cliffs (1979) 142 CLR 140. Nettle each payment of rent and outgoings under the lease would be incurred on revenue account194. Pertinently for present purposes, the same would also be true of a promise to pay rent at an increased rate under the lease. If, as consideration for agreeing to the assignment of the lease, the landlord required the shopkeeper to agree to an increase in rent and to pay the increased rent for the term of the lease, or even for just some years of the term, the payment of rent at the new rate would doubtless be incurred on revenue account. Prima facie, this case is sufficiently analogous to an assignment of a lease to suggest that similar considerations should apply. By cl 13.3(d) of the Asset Sale Agreement, the appellant covenanted with the State in part consideration for the assignment of the licence to pay the specified charges when due. Despite the covenant, however, the specified charges were recurrent obligations which arose under or out of the possession and operation of the licence, just as much as rent due under a lease arises under or out of the possession and operation of the leased premises. Admittedly, there can be dangers in analogies195. What holds for a property developer or a shopkeeper does not necessarily apply to a distributor of electricity. Despite Dixon J's sanguinity as to the discrimen of the capital– revenue dichotomy rising above the category of an unformulated question of fact, there is obvious truth in Barwick CJ's apophthegm that in this area of the law each case turns on its facts. But analogies are useful in illuminating the manner in which established principle operates in fact and thereby revealing aspects of principle which may suggest that the result in a given case should be one thing rather than another. The question, then, is what is there in principle which, in the circumstances postulated of a covenant to pay rent under a lease, mandates that, despite the covenant, the rent when due or paid is incurred on revenue account? Ultimately, it appears from the majority judgments in Cliffs, and particularly from the judgment of Jacobs J196, to be that primacy should be accorded to the character of the advantage or interest sought to be obtained by the payment of rent under the lease in preference to the character of the advantage 194 Federal Commissioner of Taxation v South Australian Battery Makers Pty Ltd (1978) 140 CLR 645 at 653-655 per Gibbs ACJ. 195 Federal Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 CLR 1 at 43 [151] per Crennan J; [2006] HCA 35. 196 (1979) 142 CLR 140 at 174-175. Nettle sought to be obtained by the covenant. The advantage or interest sought to be obtained by payment of rent under the assigned lease is the satisfaction of a regular and recurrent obligation which inheres in the lease197. It is not the acquisition of the lease, because by the time that rent is paid or becomes due the lease has been acquired. Admittedly, the advantage or interest sought to be obtained is also the satisfaction of the covenant given in consideration of the assignment of the lease. But, as appears from the majority's reasoning in Cliffs, that is conceived of as being of secondary importance. The predominant and, therefore, determinative character of the rent is of an outgoing of which the occasion is the use and exploitation of the means of production of assessable income. It should be noted, too, that there was no disagreement between the majority and the minority in Cliffs as to the relevance of that criterion. Gibbs J disagreed with the majority only because, in effect, his Honour concluded that the payments in issue were not in fact made for the use and exploitation of the mineral leases. That was so because the mining operations could have been continued whether or not the payments were made. The situation was in that respect similar to Colonial Mutual and Tata Hydro-Electric Agencies, Bombay v Income-tax Commissioner, Bombay Presidency and Aden198, to which reference will later be made. As Gibbs J put it199: "Although there was evidence, which was accepted, that the parties regarded the payments as in the nature of royalties, the payments did not in truth have that character. The payees had no interest in the mineral leases, and could not either give or withhold permission to mine them. The payments could not properly be said to have been made for the right to mine the ore, since the mining operations could be continued whether or not the payments were made. The case falls within the principle on which Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation and Ralli Estates Ltd v Commissioner of Income Tax were decided. ... In my opinion the present case is indistinguishable from Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation. The facts also appear to me to be indistinguishable from those in Tata Hydro-Electric Agencies Bombay v Income Tax Commissioner, Bombay Presidency and Aden, although of course that case was decided on a statute containing words different from those of s 51(1)." 197 See Cliffs (1979) 142 CLR 140 at 149 per Barwick CJ. 199 Cliffs (1979) 142 CLR 140 at 156-157 (footnotes omitted). Nettle Similarly, Stephen J based his conclusion on his perception that the payments were in truth and substance delayed instalments of the purchase price rather than payments for use or exploitation of the mineral leases. So much was demonstrated by the fact that the only connection between the amounts of the payments and the tonnage of ore extracted from the mine was that a percentage of the value of tonnage was the method of computation of the purchase price chosen by the parties200: "By promised payment the taxpayer secured to itself rights, in part existing, in large partly [sic] only prospective and in a sense speculative but from the exercise of which, directly or at one remove, it might look forward to the deriving of income in the future. Their promised payment formed a part of the consideration in return for which those rights were secured and they were aptly enough described in the agreement as a part of the 'purchase price'. Moreover that 'purchase price' was paid or promised once and for all in return for one bundle of rights. Once those rights were acquired by the taxpayer there remained nothing more for the vendors to give it: the transaction between them was complete save that the taxpayer's promise to make the 'deferred payments' remained to be performed. Those future payments were not to be paid in return for advantages to be granted in the future but, rather, in consideration of a single event occurring in the past, namely the transfer of the vendors' shareholding in Basic. The linking of the quantum of the future payments with matters contemporaneous with the making of those payments was but the outcome of the particular method adopted for the determination of their quantum." Stephen J acknowledged that the situation is different where payments are for the right to use and exploit the asset, as with the payment of rent under a lease or royalties under a licence201: "The important distinction between such a case and instances of leases of land or the licensing of patents is that in those cases rent or royalties are paid for the right to occupy or use the property or rights of another. But here the vendors, upon exercise of the option, retained nothing and the taxpayer thereafter made no use of anything to which the vendors retained any claim." 200 Cliffs (1979) 142 CLR 140 at 160. 201 Cliffs (1979) 142 CLR 140 at 160. Nettle His Honour concluded, however, that where the only reason for the adoption of a stream of payments computed by reference to production was because it was the negotiated means of computation of the purchase price, the situation was in all relevant respects similar to Colonial Mutual and Tata202: "It may be that money paid by a purchaser as part of the purchase price of a capital asset which he buys will not, for that reason alone, necessarily always bear the character of an outgoing of capital. But at least where, as here, whatever indicia of a revenue nature which the agreed purchase price may possess can be seen to be due only to factors such as the impossibility of placing a value, at the date of grant of the option, upon what is bought, the capital nature of what is bought will be most cogent evidence of the capital nature of the outgoing. To such a case I would apply what was said by Fullagar J in Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation where speaking of payments made as the price of acquiring an asset, his Honour said: 'It does not matter how they are calculated or how they are payable, or when they are payable, or whether they may for a period cease to be payable. If they are paid as parts of the purchase price of an asset forming part of the fixed capital of the company, they are outgoings of capital or of a capital nature.'" Were the specified charges paid for the acquisition of the assets? Allowing that the relevant criterion for determining whether a stream of payments is on capital or income account is whether, like rent paid under a lease, it is paid predominantly for the use and exploitation of an asset as opposed to its acquisition, is there anything in principle which dictates that the result should be different in this case? Subject to what follows, it could not be said that the advantage or interest which the appellant sought to obtain by the payment of the specified charges was the acquisition of the licence. For just as in the case of the payment of rent under an assigned lease, by the time of payment of each specified charge the licence had been acquired. Each specified charge was paid in satisfaction of an annual obligation which inhered in the licence so acquired and, therefore, of which it can properly be said that the occasion was the maintenance or deployment of the 202 Cliffs (1979) 142 CLR 140 at 161 (footnote omitted), quoting Colonial Mutual (1953) 89 CLR 428 at 454. Nettle means of production of assessable income203. The appellant's retention of the licence was dependent upon payment of the specified charges. As has been noticed, the State retained the right to revoke the licence for breach if the specified charges were not paid. In those circumstances, why should the predominant character of the specified charges not be seen as relevantly similar to rent and therefore deductible outgoings? The Commissioner contended that it was enough to render the payments capital that the appellant covenanted to pay the specified charges under the Asset Sale Agreement. The covenant was the predominant consideration and, as such, it characterised the payments of specified charges as, in effect, payments by instalments of the cost of acquisition of the licence. Counsel for the appellant faintly suggested that, properly construed, the Asset Sale Agreement did not create a contractual obligation to pay the specified charges. But it is clear that it did. As previously noted, cl 13.3(d)(1) of the Asset Sale Agreement expressly provided that the appellant was bound to pay "the amounts set out in the [Order] in order to carry on the Business transferred from the Seller". The Commissioner's submission must nonetheless be rejected. In effect, it does no more than restate the misconception that, where a covenant to perform a regular and recurrent obligation inherent in an asset is given as part of the consideration for acquisition of the asset, the obligation must be characterised as a capital outgoing. As has been seen, at least in the case of rent and royalties, that is not the case. The Commissioner next contended that payment of the specified charges was in truth and substance payment of part of the purchase price under the Asset Sale Agreement because the amount styled "Total Purchase Price" was relevantly defined as the "price of the Assets" net of "Creditors ... assumed under this agreement". Under cl 2.1 of the Asset Sale Agreement, the appellant assumed PNV's "Creditors" as at completion. By the time of completion, the Order had been made and PNV's liability to the State for the specified charges had crystallised. Hence, by the time of completion, the State was a creditor of PNV and the appellant assumed that liability. That contention must also be rejected. As at the date of completion, PNV's liability to the State to pay the specified charges was contingent on PNV still being the licence holder when the specified charges fell due. Consequently, 203 See Commissioner of Taxation v Morgan (1961) 106 CLR 517 at 520-522; Federal Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 CLR 1 at 44 Nettle the appellant took over PNV's obligation to pay the specified charges as it did PNV's obligation to pay the specified fees. The position in this respect is no different from that of an assignee of a lease, who covenants as a term of the assignment to pay rent under the lease, taking over the assignor's obligation to pay the rent. When pressed to say why in principle the appellant's covenant to pay the specified charges should be regarded differently from an assignee's covenant to pay rent under an assigned lease, counsel for the Commissioner could offer no more than that payment of rent under a lease is an established category of revenue outgoing and that the Commissioner relied on the decision of the Privy Council in Tata204. Neither of those responses is persuasive. Granted, the payment of rent under a lease is an established category of revenue outgoing, and specified charges paid in connection with an electricity transmission licence are not. But to say so discloses nothing in point of principle as to why the two should not be treated alike. Tata was concerned with whether an obligation of a purchaser of a business to the vendor to pay a share of profits from the business to a third party was incurred "solely for the purpose of earning ... profits or gains" of the business within the meaning of s 10(2)(ix) of the Indian Income-tax Act 1922205. As such, much of the reasoning in Tata is of little relevance to this case. Apart from differences between the facts, the question of whether an obligation is incurred solely for the purpose of earning profits or gains is different from whether an outgoing is incurred in gaining or producing assessable income or in carrying on business for the production of such income. As was explained in Egerton-Warburton v Deputy Federal Commissioner of Taxation206, the different construction of the Australian legislation means that revenue charges incurred on account of the acquisition of land or its continued occupation involve an outlay for the production of income derived from the land and are for that reason deductible. Under the ITAA, what counts is the nature of the obligation assumed. If it is an obligation of a recurrent nature incurred for the continued use of the asset acquired, it is hardly to the point that the obligation may have been assumed in consideration of the acquisition of the asset. 205 [1937] AC 685 at 692. 206 (1934) 51 CLR 568 at 579-581 per Rich, Dixon and McTiernan JJ. Nettle The Commissioner relied on the fact that, in Tata, it was held that the purchaser's promise to pay a share of profits to the third party was in the nature of a promise to pay the purchase price by instalments. But, as was earlier remarked, that was so because the only connection between the business acquired by the purchaser and the purchaser's obligation to pay the share of profits to the third party was that the purchaser covenanted with the vendor, in consideration of the acquisition of the business, to pay the third party a share of the profits to be derived from the business. In contradistinction to an obligation to pay rent under an assigned lease or an obligation to pay specified charges which inheres in a licence, in Tata there was no connection between the purchaser's obligation to pay the share of profits to the third party and the purchaser's maintenance or deployment of the means of production of assessable income207. The purchaser's retention of the business was not in any sense dependent on the obligation to pay the third party. Breach of the obligation to pay the third party might have exposed the purchaser to an action for damages for breach of contract but not to forfeiture of the business assets. In form and substance, the purchaser's obligation to make payments to the third party was no different from an obligation to make payments to or at the direction of the vendor. It is true that, in Colonial Mutual, Williams ACJ and Fullagar J referred to Tata as supporting their conclusion that an obligation on the part of the taxpayer to pay the vendors of land a share of rents to be derived by the taxpayer from properties it proposed to construct on the land once acquired was a capital outgoing208. But that was because in Colonial Mutual the share of rents was part of the purchase price. Although regular and recurrent, the payments were payments for the acquisition of the land as opposed to payments for the continued use and occupation of the land. As in Tata, the taxpayer's use and occupation of the land was not dependent upon payment of the share of the rents. Breach of its obligation might have resulted in an action for damages for breach of covenant but it held the land in fee simple. Means adopted to make the payments The Commissioner further contended that the specified charges were incurred on capital account because, unlike the specified fees, which were payable throughout the term of the licence, the specified charges were limited in number, fixed in amount and evidently connected with the Asset Sale Agreement, and so were far from being regular and recurrent. More specifically, it was submitted that the payments were in effect a one-off liability connected 207 [1937] AC 685 at 695. 208 (1953) 89 CLR 428 at 444-445 per Williams ACJ, 455 per Fullagar J. Nettle with the privatisation of the power network and were voluntarily assumed by the appellant as part of the acquisition of the assets as an alternative to payment of a higher price for the privatised business. That was borne out, it was said, by the fact that the specified charges were calculated by reference to the licensee's assumed profitability; that the appellant took the obligation to pay the specified charges into account in the determination of its bid price for the assets; that the appellant covenanted that it would not challenge the lawfulness of the specified charges; and that, at least initially, the appellant recorded the payments in its audited books of account as a capital outgoing. These considerations, it was submitted, reinforced the Commissioner's primary submission that the specified charges were paid for the acquisition of the transmission assets. Those submissions face difficulties at several levels. First, although it is true that the number of payments was limited and that the payments were fixed in amount, their limited number is not of great significance. As Dixon J said in Sun Newspapers209, recurrence is not a question of recurring every year or every accounting period. Nor is it a criterion of distinction. The real test is whether the expenditure is in the "wide class of things which in the aggregate form the constant demand which must be answered out of the returns of a trade or its circulating capital". "[A]ctual recurrence of the specific thing need not take place or be expected as likely."210 Secondly, assuming that "fixed amounts" means that the payments were pre-determined and set out in the Asset Sale Agreement rather than being imposed ad valorem on profits or income actually generated, the fact that they were so fixed is logically beside the point. In form and as a matter of substantive legal obligation, the payments were of a compulsory tax levied annually during the transition period. As the appellant submitted, a payment in the nature of a periodical tax is customarily conceived of as incurred on revenue account. As Moffatt v Webb shows211, that is because the payment of a periodical tax does not secure to the taxpayer any capital advantage. Here, as in Moffatt v Webb, the payment of the specified charges did not secure to the appellant any capital advantage. It secured the appellant against being disturbed in its operation of the licence and against the potential that the licence would be forfeit if the specified charges were not paid. According to ordinary conceptions, those attributes colour the specified charges as outgoings incurred on revenue account. 209 (1938) 61 CLR 337 at 362. 210 Sun Newspapers (1938) 61 CLR 337 at 362. 211 (1913) 16 CLR 120 at 130 per Griffith CJ; [1913] HCA 13. Nettle Thirdly, it is not clear why the fact that the specified charges were calculated by reference to the licensee's estimated revenue and profitability should be regarded as significant. Plainly deductible regular and recurrent obligations like rent212, royalties213, rates, land tax, resources rent tax and franchise fees214 are not infrequently calculated by reference to a fixed percentage of actual or projected revenue, profits or value. There is nothing in principle or in the facts of the decided cases which suggests that, because they are so computed, the obligation to pay them should be regarded as incurred on capital account. Admittedly, the specified charges were a "one-off" liability in the sense that they were imposed only during the transition period between 1998 and 2000, after which the X factor was increased to 11 per cent. It is also correct that the specified charges were associated with privatisation of the power network and that they were the means by which, figuratively speaking, the State took a share of the economic monopoly profits which it was projected would flow to the licensee during the transition period. But neither of those considerations detracts from the legal and fiscal reality that the specified charges were a regular and recurrent tax to which the appellant was subjected qua licence holder throughout the transition period. Fourthly, the fact that the appellant covenanted not to challenge the lawfulness of the specified charges and to pay them in any event is also beside the point. It has not been suggested that they were unlawfully imposed and, in any event, unless and until their imposition was declared to be unlawful the appellant was under a legal obligation to pay them. It is true that, if their imposition under s 163AA had been declared unlawful, the appellant's only obligation to continue to pay them in those circumstances would have been its contractual liability under cl 13.3(d). No doubt, it might also be said that that was incurred in consideration of the transfer of the licence to the appellant. But, even then, the nature of the contractual liability, no less than a contractual liability to pay rent under a covenant given in consideration of an assignment of lease, would still have been a regular and recurrent liability which inhered in the asset – in this case, the licence – in respect of which it was charged. 212 Federal Commissioner of Taxation v South Australian Battery Makers Pty Ltd (1978) 140 CLR 645. 213 See, eg, H R Sinclair & Son Pty Ltd v Federal Commissioner of Taxation (1966) 114 CLR 537; [1966] HCA 39. 214 Federal Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 CLR 1. Nettle Payments of tax on capital account The Commissioner contended that a tax can be and often is an affair of capital. Counsel for the Commissioner instanced conveyance duty payable on the acquisition of land and also referred to the decision of the Full Court of the Federal Court in United Energy as authority that compulsory imposts may be incurred on capital account. Those comparisons are inapposite. Conveyance duty is an outgoing on capital account because it is a charge on the capital value of the property conveyed. As such, it is in the nature of an additional capital cost of acquisition of the property conveyed. A tax of that kind bears no relationship to the specified charges in this case, which, as opposed to being charged on the purchase price of the licence, were computed and levied in respect of each of the three transition period years of operation of the licence according to the profits which it was considered were capable of being generated from operation of the licence in that period. Finally, the Commissioner contended that the specified charges were paid as part of the regulatory framework in which the transmission business was to operate. The regulatory framework, which included the Tariff Order, gave licence holders benefits that included predictable revenues and the ability to outperform the assumptions which underpinned those revenues. Those benefits formed part of the profit-yielding structure of the business. Thus, by analogy with United Energy, the payments should be treated as incurred on capital account. That contention should also be rejected. The decision in United Energy rested on the conclusion of the plurality that the distribution franchise fee which United Energy was required to pay to the Government under s 163A of the EIA was consideration for the advantage of being free from competition of other distribution companies within an exclusive distribution area. Their Honours reasoned as follows215: "In the Explanatory Memorandum set out under the heading The Franchise Fees, the fee is said to be 'appropriately viewed … as a fee payable by the [distributors] for the benefit … of their franchise customer bases'. That is in our view an accurate description of the fee. The 'benefit' referred to is that a franchise customer, being one who has 'not yet become contestable' under the reforms, must buy electricity from the distribution company for its area for so long as that customer is not 'contestable'. The franchise fee is not payable for the right to sell electricity to customers in 215 (1997) 78 FCR 169 at 192-193 per Sundberg and Merkel JJ (original emphasis). Nettle the distributor's licence area. That right is conferred by a licence to sell electricity granted under ss 162 and 163 for which a different fee is payable. Rather the franchise fee is payable for the advantage enjoyed by the distribution company of being free from the competition of the other four distribution companies for the custom of franchise customers in the distributor's licence area. The fee was aptly described by the Minister as a 'monopoly rent' for the exclusive right to sell to franchise customers in the distributor's licence area during the transitional period. The licence is consistent with the Act. The exclusivity granted to a licensee in respect of franchise customers does not arise by reason of any term of a Retail licence. Rather, it arises because each Retail licence authorises sales of electricity only to franchise customers within the licence area. That limited authorisation and the prohibition against unauthorised sales under s 159(1) ensure the exclusivity required by s 162(2B). Accordingly, the franchise fee is payable by the taxpayer for and by reason of the exclusivity provided for under ss 162(2B) and 163A(4) and conferred by a combination of s 159(1) and the terms of the Retail licences granted to the five distribution companies. This conclusion is significant as it is not strictly correct to contend, as did counsel for the taxpayer, that the franchise fee is payable in 'consequence' of the licence or the monopoly the licence entitled the taxpayer to exercise in relation to part of its market." The decision is, therefore, distinguishable on the basis that the franchise fee was considered to have been paid in consideration of a legal monopoly whereas, in this case, the licence did not confer a legal monopoly. The only monopoly was economic. More importantly, however, several aspects of the plurality's reasoning in United Energy are distinctly problematic. The fact that the Government chose to describe the franchise fee as "a fee payable by the [distributors] for the benefit … of their franchise customer bases", or even that the franchise fee was based on the Government's asseverated conviction that the State should receive some benefit from the monopoly profits which it was anticipated would flow to a licence holder, could not alter the formal and substantive legal reality that the franchise fee was a compulsory exaction levied on a licence holder because it was a licence holder. Whatever the underlying economic rationale of its imposition, it was a regular and recurrent obligation of which the occasion inhered in the means of production of assessable income. It is true that United Energy's licence effectively conferred the benefits of exclusivity in the licence area. But non constat that the franchise fees were not expenditure of a kind among the wide class of things which in the aggregate form Nettle the constant demand which must be answered out of the returns of trade or circulating capital. Allowing that exclusivity is to some extent a lasting advantage and, therefore, that sums outlaid in securing exclusivity may be characterised as outgoings of capital216, whether they should be so characterised in a given case must depend upon the means of acquisition. As has been explained, if the means of obtaining exclusivity are by the making of recurrent payments analogous to rent accruing de die in diem or at other intervals, such payments may properly be characterised as incurred on revenue account. Thus, no one would doubt that rent paid under the lease of an hotel with the benefit of an exclusive liquor licence is deductible. Most importantly, the reasoning of the plurality in United Energy is at odds with the later reasoning of this Court in Federal Commissioner of Taxation v Citylink Melbourne Ltd217. Citylink was concerned with the deductibility of concession fees payable under a Tollway Concession Deed that conferred an exclusive right to conduct a tollway for the period of the concession. The Court rejected the Commissioner's contention that the concession fees were in substance payments by instalments for the purchase of a capital asset comprised of the exclusive right to operate the tollway. As Crennan J (with whom Gleeson CJ, Gummow, Callinan and Heydon JJ agreed) said218: "The concession fees are only payable during the term of the concession period. The respondent does not acquire permanent ownership rights over the roads or lands used. All rights granted under the Concession Deed revert to the State at the expiry of the concession period. Unlike periodic instalments paid on the purchase price of a capital asset, the concession fees are periodic licence fees in respect of the Link infrastructure assets, from which the respondent derives its income, but which are ultimately 'surrendered back' to the State. Accordingly, they are on revenue account." The Commissioner submitted that Citylink was different because the concession fees in that case were paid for the right to operate a capital asset as opposed to consideration for the purchase of a capital asset, and that the concession fees were payable throughout the life of the licence in contrast to the specified charges, which were payable for just the first three years of the licence period. 216 See, eg, Sun Newspapers (1938) 61 CLR 337. 217 (2006) 228 CLR 1. 218 (2006) 228 CLR 1 at 44 [154] (footnote omitted). Nettle There is no substance in either of those distinctions. As was earlier noticed, although the appellant covenanted as part of the consideration for its acquisition of the licence that it would pay the specified charges when due, it paid the specified charges after it had acquired the licence in discharge of a regular and recurrent obligation in the nature of a tax imposed on it as the holder of the licence. And, although its payment of the specified charges could perhaps be viewed as being as much in discharge of its contractual liability to pay the imposts as in discharge of its statutory obligation to do so, principle and the analogy of rent payable by an assignee of a lease who has covenanted as a term of the assignment to pay the rent when due imply that the predominant and therefore determinative character of the specified charges was one of an outgoing of which the occasion was the maintenance or deployment of the licence as means of production of assessable income. As has been stated, recurrence is not a question of recurring every year or every accounting period. The test is whether the expenditure is in the wide class of things which in aggregate form the constant demand which must be answered out of the returns of trade or circulating capital. Actual recurrence of the thing need not take place or even be expected. Economic equivalence? It remains to mention the reliance which the Commissioner placed on the facts that the appellant computed the amount of its bid for the licence by reference to the anticipated specified charges burden, and at least initially recorded the specified charges in its books of account as a capital outgoing. As in several other aspects of the Commissioner's submissions, the significance which the Commissioner attributed to those facts appeared to proceed from an unstated sub-text – that, because the State could have structured the obligation to pay the specified charges as an obligation to pay an additional amount of purchase price, the specified charges should be treated as if they were additional amounts of purchase price. Thus, despite counsel taking care to avoid specific reference to conceptions of that nature, not a little of the argument presented as if it were based on notions of economic equivalence of the kind which this Court rejected in Citylink219. There is no room for notions of economic equivalence the determination of what is deductible. Obviously, any capital outlay can be expressed in terms of an economically equivalent projected stream of income payments just as any projected stream of revenue outgoings can be expressed in terms of a present discounted capital value. Thus, the less the specified fees, specified charges and other revenue obligations, the more the assets were likely to be worth, and so the more that a rational self-interested purchaser would be 219 (2006) 228 CLR 1 at 31 [95] per Crennan J. Nettle prepared to pay; and vice versa. It is, therefore, not at all surprising that the appellant took the specified charges into account in determining its bid price for the assets and undertaking of PNV. But, absent notions of economic equivalence, that says nothing about the appropriate characterisation of the payments. No doubt, the State could have structured the transaction as one of payments in consideration of the State's agreement to the assignment of the licence instead of specified charges payable qua licensee. Had it done so, the payments would have been a capital expense. But the State chose to proceed by way of specified charges exigible in respect of holding the licence instead of payments in consideration of assignment of the licence, just as it might have chosen to proceed by way of a variation in the X factor. The need to approach the characterisation of outgoings from a common sense business point of view does not mean that, because an outgoing on revenue account could have been structured as a transaction on capital account, by some process of economic equivalence it may be treated as if it were the latter. It was not suggested that Pt IVA of the Income Tax Assessment Act 1936 (Cth) applied. The fact that the appellant recorded the outgoings as capital in its books of account is equally inconsequential220. It might have been to the point had there been a dispute about the reality of the transaction or if Pt IVA had been invoked. If it had been contended that the structuring of the specified charges as imposts was a pretence designed to mask what were in truth payments of instalments of purchase price, or that the dominant purpose in choosing imposts over an increased purchase price was a tax advantage, the fact that the appellant recorded the payments as capital outgoings might have been viewed as an admission of fact against interest and thus been admissible in proof of the truth about the transaction221. But, in the absence of a contention of either kind, the way in which the outgoings were treated in the books of account is irrelevant222. Conclusion and orders In the result, the appeal should be allowed. The orders of the Full Court should be set aside. In their place, it should be ordered that the appeal to the Full Court is allowed with costs, the judgment of the Federal Court is set aside, and in 220 Broken Hill Theatres Pty Ltd v Federal Commissioner of Taxation (1952) 85 CLR 423 at 434-435 per Dixon CJ, McTiernan, Fullagar and Kitto JJ; [1952] HCA 75. 221 See, eg, Grey v Australian Motorists & General Insurance Co Pty Ltd [1976] 1 NSWLR 669 at 675-676 per Glass JA; cf at 684-685 per Mahoney JA. 222 Dovuro Pty Ltd v Wilkins (2003) 215 CLR 317 at 327 [25] per Gleeson CJ, 340-342 [68]-[71] per Gummow J; [2003] HCA 51. Nettle its place the appeal against the disallowance of objection is allowed and the matter is remitted to the Commissioner for reassessment according to law. The respondent should pay the appellant's costs of the appeal to this Court. Nettle Appendix Transmission Licence The Office may at any time give at least 20 business days notice of revocation to the Licensee if the Licensee does not comply with an enforcement order or an undertaking, and the Office decides that it is necessary or desirable to revoke this licence in order to achieve the policy objectives, in which case the term of this licence ends, subject to clause 3.5, on the expiration of the period of the notice. 18. COMPLIANCE WITH LAWS The Licensee must comply with all applicable laws including but not limited to the Tariff Order. "enforcement order" means a provisional or final order made and served by the Office under section 35 of the Office of the Regulator-General Act "undertaking" means an undertaking given by the Licensee under section 35(5)(a) of the Office of the Regulator-General Act 1994; Office of the Regulator-General Act 1994 35. Enforcement orders This section applies if a person is contravening, or in the opinion of the Office is likely to contravene— a determination; or if the Office is under the relevant legislation or by virtue of an Order in Council under section 3(2) responsible for licensing, the conditions of a licence— the Office considers and contravention is not of a trivial nature. that the contravention or likely Nettle The Office may serve a provisional order or a final order on the person requiring the person to comply with the determination or licence condition. (3) Unless sooner withdrawn by the Office, a provisional order has effect for a period of 7 days commencing on the day that it is served. The Office may serve another provisional order upon the expiry of a preceding provisional order. If the Office has made a provisional order, the Office must not make a final order if— the person has undertaken to comply with the determination or licence condition; or the Office is satisfied that the order would be inconsistent with the objectives of this Act. The Office must not make a final order unless the Office has— given the person at least 28 days notice of the intention to do so; and given the person the opportunity to make a submission in respect of the order; and considered any submission or other objection to the order received by the Office. The Office must as soon as possible after serving a provisional order or a final order on a person publish a copy of the order in the Government Gazette. (8) A person must comply with a provisional order or a final order or an undertaking under sub-section (5)(a). Penalty: 1000 penalty units and 100 penalty units for each day that contravention the order after service of continues.
HIGH COURT OF AUSTRALIA AND THE QUEEN APPELLANT RESPONDENT [2012] HCA 59 12 December 2012 ORDER Appeal allowed. Set aside paragraphs 5 to 12 of the order of the Court of Appeal of the Supreme Court of Victoria made on 5 October 2011. Remit the matter to the Court of Appeal of the Supreme Court of Victoria for further consideration in accordance with the reasons of this Court. On appeal from the Supreme Court of Victoria Representation P F Tehan QC with T R Alexander for the appellant (instructed by Defteros Lawyers) T Gyorffy SC with E H Ruddle for the respondent (instructed by Solicitor for Public Prosecutions (Vic)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Appeal – Error or irregularity in trial – Failure to sever counts – Appellant charged with numerous counts of blackmail of one victim and one count of blackmail of another victim – Trial judge refused application to sever trial of separate count – Court of Appeal held that trial judge erred in refusing application – Whether refusal to sever resulted in "substantial miscarriage of justice" within meaning of s 276 of Criminal Procedure Act 2009 (Vic). Words and phrases – "substantial miscarriage of justice". Criminal Procedure Act 2009 (Vic), s 276. FRENCH CJ, HAYNE, CRENNAN, KIEFEL AND BELL JJ. The issue Section 276(1)(b) of the Criminal Procedure Act 2009 (Vic) ("the Act") obliges the Court of Appeal to allow an appeal against conviction if the appellant satisfies the Court that "as the result of an error or an irregularity in, or in relation to, the trial there has been a substantial miscarriage of justice". The appellant (together with another accused) was charged with, and found guilty of, numerous counts of blackmailing one victim (Hassan Rifat)1. The appellant was also charged with, and found guilty of, one count of blackmailing a second victim (Nicholas Srour). All the counts were tried together. It is now accepted that the single count of blackmailing Mr Srour should have been tried separately. Because the counts were tried together, the jury heard both victims describe the demands and the menaces the appellant was alleged to have made to each. The jury thus heard Mr Srour's evidence to the effect that the appellant was "a standover man" and that the appellant had told him that he (the appellant) used standover tactics, bullying and assaulting people in order to get things. It is now accepted that at least some of the evidence of one victim was not relevant in the trial of the count or counts concerning the other victim. The Court of Appeal held2 that the appellant had shown a substantial miscarriage of justice in respect of the trial of the Srour count because the jury heard "highly prejudicial" evidence about the Rifat counts which was irrelevant to the Srour count. But the Court of Appeal held3 that the appellant had not shown a substantial miscarriage of justice in respect of the trial of the Rifat counts. This was for two reasons. The first depended upon the jury having been instructed to consider each count separately. The Court of Appeal said4 that the jury's return of different verdicts on different counts "strongly suggests that [the jury] gave separate consideration to each count, and only found a count established where the evidence of guilt of the particular accused was clear-cut". Second, the evidence in respect of the Rifat counts was not such as to "bespeak a 1 Contrary to s 87 of the Crimes Act 1958 (Vic). 2 Baini v The Queen (2011) 213 A Crim R 382 at 399 [71]. (2011) 213 A Crim R 382 at 398 [70]. (2011) 213 A Crim R 382 at 399 [70] (footnote omitted). Hayne Crennan Bell situation in which the jury should have had a reasonable doubt" of the appellant's guilt and the Court of Appeal "entertain[ed] no such doubt"5. Did the Court of Appeal apply s 276(1)(b) of the Act correctly? The course of proceedings It is desirable to say a little more about the course of the proceedings leading to this appeal. The appellant and another accused, Badar Arafan, were presented and tried by judge and jury in the County Court of Victoria on a presentment charging the appellant with 16 counts of blackmail, Mr Arafan with 20 counts of blackmail and both the appellant and Mr Arafan together with a further 32 counts of blackmail. All but one of the counts alleged that the victim of the blackmail was Mr Rifat. One count, preferred against only the appellant, alleged that the victim of the blackmail was Mr Srour. At trial, there were directed verdicts of acquittal on some counts and, on others, the jury returned verdicts of not guilty. The jury found the appellant guilty on 36 of the counts, including the Srour count, and the jury found Mr Arafan guilty on 13 of the counts. It is now not disputed that the trial judge (Judge Wood) erred in refusing to sever the trial of the Srour count from the trial of the other counts on the presentment, all of which concerned Mr Rifat. Further, it is now not disputed that, because there was no severance, evidence was led at the trial about the demands and the menaces allegedly made against one victim that was not admissible on the trial of the count or counts relating to the other victim. And it did not appear ultimately to be disputed that the evidence about the Srour count which would not have been admissible in a separate trial of the Rifat counts included Mr Srour's evidence that has already been described: that the appellant was "a standover man" and that the appellant had told him that he (the appellant) used standover tactics, bullying and assaulting people in order to get things. It is accepted that much of the extensive evidence given in support of the numerous Rifat counts was not admissible in the trial of the Srour count. On application for leave to appeal to the Court of Appeal against conviction, that Court (Warren CJ, Nettle and Ashley JJA) granted leave and (2011) 213 A Crim R 382 at 403 [101]; see also at 398 [70], 403 [102]. Hayne Crennan Bell allowed6 the appellant's appeal against his conviction on the Srour count, ordered that there be a new trial of the Srour count, and refused the appellant leave to appeal against his convictions on the Rifat counts. The principal reasons of the Court were given by Ashley JA, who concluded7 that, for the reasons that have been described, the appellant had not shown "that any substantial miscarriage was occasioned to the [appellant] in respect of the Rifat counts by reason of the refusal to sever" the presentment. By special leave, the appellant appeals to this Court alleging that the Court of Appeal should have found that there was a substantial miscarriage of justice in respect of the trial of the Rifat counts. Whether that is so depends upon the proper construction and application of the Act and in particular s 276(1)(b). The Act and appeals against conviction Section 274 of the Act provides: "A person convicted of an offence by an originating court may appeal to the Court of Appeal against the conviction on any ground of appeal if the Court of Appeal gives the person leave to appeal." The County Court in its original jurisdiction is an "originating court"8. Section 276 of the Act provides: "(1) On an appeal under section 274, the Court of Appeal must allow the appeal against conviction if the appellant satisfies the court that— the verdict of the jury is unreasonable or cannot be supported having regard to the evidence; or (2011) 213 A Crim R 382. (2011) 213 A Crim R 382 at 398 [70]. s 3. "[O]riginal jurisdiction" is defined in s 3 as including, relevantly, a proceeding for an indictable offence. Hayne Crennan Bell as the result of an error or an irregularity in, or in relation to, the trial there has been a substantial miscarriage of justice; for any other reason there has been a substantial miscarriage of justice. In any other case, the Court of Appeal must dismiss an appeal under section 274." There was no dispute in this Court that the Rifat counts and the Srour count should have been tried separately. The refusal to sever the trials was "an error or an irregularity in, or in relation to, the trial" of the appellant. The central focus of argument was whether the Court of Appeal should have found that the appellant had satisfied the Court that, as the result of this error or irregularity, "there has been a substantial miscarriage of justice". That is the determinative question in this appeal: should the Court of Appeal have been satisfied that "there has been a substantial miscarriage of justice" within the meaning of s 276(1)(b)? And that question is ultimately one of statutory construction. A question of construction Whether there has been a "substantial miscarriage of justice" within the meaning of s 276(1)(b) requires consideration of the text of the statute. As the Court said in Fleming v The Queen9, "[t]he fundamental point is that close attention must be paid to the language" of the relevant provision because "[t]here is no substitute for giving attention to the precise terms" in which that provision is expressed. Paraphrases of the statutory language, whether found in parliamentary or other extrinsic materials or in cases decided under the Act or under different legislation, are apt to mislead if attention strays from the statutory text10. These paraphrases do not, and cannot, stand in the place of the words used in the statute. (1998) 197 CLR 250 at 256 [12]; [1998] HCA 68. 10 See generally Catlow v Accident Compensation Commission (1989) 167 CLR 543 at 550 per Brennan and Gaudron JJ; [1989] HCA 43; Bushell v Repatriation Commission (1992) 175 CLR 408 at 425 per Brennan J, 437 per Toohey J; [1992] HCA 47; Marshall v Director General, Department of Transport (2001) 205 CLR 603 at 632-633 [62] per McHugh J; [2001] HCA 37; Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 233 CLR 259 at 270 [31] per (Footnote continues on next page) Hayne Crennan Bell It follows that, contrary to at least some of the argument in this Court, consideration of s 276(1)(b) does not begin with this Court's decision in Weiss v The Queen11. Weiss concerned the application of the common form criminal appeal provision12 derived from the Criminal Appeal Act 1907 (UK). That form of appeal provision did not govern the appeal to the Court of Appeal in this matter; s 276 of the Act did. And while extrinsic material indicates13 that s 276 was enacted to meet perceived problems with the common form criminal appeal provision, it is to be borne in mind that, to adopt what was said14 by Brennan J in a different context, s 276 "must be construed according to its own terms rather than by reference to constructions placed on its statutory predecessor". This is not to say that observations made in Weiss about the application of the common form criminal appeal provision cannot also apply to s 276. The same or similar observations may be made about s 276 but only if the statutory text so permits. Against this background, it is convenient to begin the task of construing s 276 first by making three immediate observations about the text of the section and second by noticing how s 276 differs from the common form criminal appeal provision. Three immediate observations about s 276 The first observation to make is that s 276 deals exhaustively with the determination of an appeal under s 274. So much is clear from the statutory text. Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ; [2008] HCA 5; Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252 at 265 [33]-[34] per French CJ, Gummow, Hayne, Crennan and Kiefel JJ; [2010] HCA 23; Brennan v Comcare (1994) 50 FCR 555 at 572-573 per Gummow J; Ogden Industries Pty Ltd v Lucas (1968) 118 CLR 32 at 39; [1970] AC 113 at 127. 11 (2005) 224 CLR 300; [2005] HCA 81. 12 See Criminal Appeal Act 1912 (NSW), s 6(1); Criminal Law Consolidation Act 1935 (SA), s 353(1); Criminal Code (Q), s 668E(1) and (1A); Criminal Appeals Act 2004 (WA), s 30(3) and (4); Criminal Code (Tas), s 402(1) and (2); Criminal Code (NT), s 411(1) and (2). 13 See Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 4 December 2008 at 4985-4986. 14 Bushell v Repatriation Commission (1992) 175 CLR 408 at 425. Hayne Crennan Bell If the appellant satisfies the Court of Appeal of one or more of the three matters identified in pars (a), (b) and (c) of s 276(1), the Court must allow the appeal against conviction, and s 276(2) provides that in any other case the Court must dismiss the appeal. The Court has no "discretion" to refuse to allow an appeal even if one of the identified grounds is established and likewise it has no "discretion" to allow an appeal even if none of the identified grounds is established. The second observation to make is that the appellant bears the ultimate burden of persuasion. Section 276(1) provides that the appeal must be allowed if the appellant satisfies the Court that one or more of the grounds is established. The third observation to make is that two of the stated grounds (s 276(1)(b) and (c)) expressly require demonstration that "there has been a substantial miscarriage of justice" whereas one ground (s 276(1)(a)) does not. As will be explained below, the separate inclusion of each of pars (a)-(c) is important. But for the moment, it is sufficient to note that there has surely been a substantial miscarriage of justice if, in the words of par (a), "the verdict of the jury is unreasonable or cannot be supported having regard to the evidence". The absence of the expression "substantial miscarriage of justice" in s 276(1)(a) should not be taken to suggest otherwise. Comparisons with the common form criminal appeal provision It is possible, of course, to draw some comparisons between s 276 and the different terms of the common form criminal appeal provision derived from the Criminal Appeal Act 1907. The appellant in this Court engaged in that comparative task to ask (and answer) whether s 276 "imposes the same statutory task on an appellate court" as the common form criminal appeal provision did and whether "this Court's decision in Weiss [is] applicable" to s 276. But as already explained, comparing a statute with its legislative predecessor (and cases decided under that predecessor) is only a useful exercise if doing so illuminates the actual text of the new provision. Whether or not this comparative task is profitable in other cases, its utility is not evident here. First, to observe that the common form criminal appeal provision provided that an appeal be allowed on demonstration of a "miscarriage of justice" unless there was no "substantial miscarriage of justice", whereas s 276 provides that an appeal be allowed on demonstration of a "substantial miscarriage of justice", does not assist in construing s 276. The observation explains why what was said in Weiss cannot be "applied" to s 276 as if Weiss were decided under s 276. Hayne Crennan Bell Clearly it was not. But the observation says nothing about the meaning of "substantial miscarriage of justice". Second, there appears to be little, if any, immediate utility in recognising that s 276 imposes the ultimate burden of persuasion on the appellant whereas the common form criminal appeal provision cast some burden (whether evidentiary or persuasive) on the respondent. In few, if any, cases will the placement of the onus of proof affect the content to be given to specific statutory expressions and criteria. And the observation that the ultimate burden of persuasion rests on the appellant, even in combination with the observation (or perhaps it is an assumed conclusion15) that statute and the common law recognise a presumption of innocence, says nothing about the content to be given to the expression "substantial miscarriage of justice". In particular, the appellant's broad statements that "it would be unjust for the appellant ... to be required to persuade the court that he or she was not guilty" are unhelpful because they do not grapple closely with the statutory text. As a practical matter, few, if any, appeals governed by s 276 will turn upon which party bears the onus of proof. It is not to be supposed that notions of there being no case to answer at trial for want of proof of an element of an offence intrude into the determination of an appeal under s 274. Nor is it to be supposed that the respondent (whether a Director of Public Prosecutions or some other prosecuting authority) would not place all relevant arguments before the Court of Appeal. Third, recognising that the question whether "there has been a substantial miscarriage of justice" is different from the question whether "no substantial miscarriage of justice has actually occurred"16 invites identification and consideration of what follows from the differences. But that task distracts attention from the central inquiry, which is, and must remain, what do s 276(1)(b) and (c) mean when they refer to "a substantial miscarriage of justice"? It is to that question that these reasons now turn. A substantial miscarriage of justice Section 276 must be read recognising that miscarriages of justice may occur in many circumstances and may take many forms. As s 276(1)(b) 15 See RPS v The Queen (2000) 199 CLR 620 at 632 [24]; [2000] HCA 3. 16 See, for example, the former s 568(1) of the Crimes Act 1958 (Vic). Hayne Crennan Bell contemplates, it will be possible sometimes to describe the cause of complaint as "an error or an irregularity in, or in relation to, the trial". That is a description which is apt to encompass any departure from trial according to law. But as s 276(1)(c) shows by its reference to "any other reason" (emphasis added), the description contemplated in par (b) is not exhaustive. When read together, pars (b) and (c) encompass any and every form of substantial miscarriage of justice. Yet the ultimate question will remain the same: has there been "a substantial miscarriage of justice"? No single universally applicable description can be given for what is a "substantial miscarriage of justice" for the purposes of s 276(1)(b) and (c)17. The possible kinds of miscarriage of justice with which s 276(1) deals are too numerous and too different to permit prescription of a singular test. The kinds of miscarriage include, but are not limited to, three kinds of case. First, there is the case to which s 276(1)(a) is directed: where the jury have arrived at a result that cannot be supported. Second, there is the case where there has been an error or an irregularity in, or in relation to, the trial and the Court of Appeal cannot be satisfied that the error or irregularity did not make a difference to the outcome of the trial. Third, there is the case where there has been a serious departure from the prescribed processes for trial18. This is not an exhaustive list. Whether there has been a "substantial miscarriage of justice" ultimately requires a judgment to be made. The singling out, in s 276(1)(a), of cases in which the verdict of the jury is unreasonable or cannot be supported having regard to the evidence is important. Its separate inclusion in the section indicates that pars (b) and (c) (and in particular the question whether there has been a substantial miscarriage of justice) cannot be confined to cases in which the Court of Appeal is satisfied that it was not open to the jury to convict the appellant. Paragraphs (b) and (c) must be read as dealing with more than the case where the Court of Appeal is satisfied that the evidence which was properly before the jury did not permit the conclusion that guilt was established beyond reasonable doubt because that sort of case is dealt with by s 276(1)(a)19 . It follows that a "substantial miscarriage of 17 Compare Weiss (2005) 224 CLR 300 at 317 [44] in relation to the proviso to the common form criminal appeal provision. 18 See, for example, AK v Western Australia (2008) 232 CLR 438 at 456 [55]-[56]; [2008] HCA 8; Handlen v The Queen (2011) 245 CLR 282; [2011] HCA 51. 19 See generally M v The Queen (1994) 181 CLR 487 at 493; [1994] HCA 63. Hayne Crennan Bell justice" encompasses not only cases identified by reference to inaccuracy of result but also cases identified by reference to departure from process even if it can be shown that the verdict was open or it is not possible to conclude whether the verdict was open. An appellant's demonstration that there has been "a substantial miscarriage of justice" for the purposes of s 276(1)(b) and (c) may be affected by the strength of the prosecution case at trial. In some cases, it may be possible for an appellate court to conclude that there has not been "a substantial miscarriage of justice" because, despite the error, irregularity or other cause of complaint, the evidence properly admissible at trial required the conclusion that the appellant was guilty of the crime alleged. But several points must be made about this possibility. First, in many cases of the kinds contemplated by s 276(1)(b) and (c), an appellate court will not be in a position to decide whether the appellant must have been convicted if the error had not been made. The nature of the error, irregularity or cause of complaint contemplated by those paragraphs will often prevent that conclusion from being reached by an appellate court on the record of the trial given the "natural limitations"20 that attend the appellate task. Second, and contrary to what the appellant's submissions sometimes suggested, the possibility that the Court of Appeal may conclude that no "substantial miscarriage of justice" occurred because a verdict of guilty, on the evidence properly admissible at trial, was inevitable neither reintroduces the proviso to the common form criminal appeal provision nor imposes on an appellant some onus of proving his or her innocence. To recognise that possibility does no more than acknowledge that the Court of Appeal's satisfaction that a finding of guilt was inevitable is relevant to determining whether there has been "a substantial miscarriage of justice". The Court's satisfaction that a guilty verdict was inevitable will not in every case conclude the issue about whether there has been a substantial miscarriage of justice but it is a matter to be taken into account in answering the question posed by s 276(1)(b) and (c). If it is submitted that a guilty verdict was inevitable, an appellant need not prove his or her innocence to meet the point. An appellant will meet the point by showing no more than that, had there been no error, the jury may have entertained a doubt as to his or her guilt. As a practical matter, it will then be for 20 See Dearman v Dearman (1908) 7 CLR 549 at 561; [1908] HCA 84; Fox v Percy (2003) 214 CLR 118 at 125-126 [23]; [2003] HCA 22. Hayne Crennan Bell the respondent to the appeal to articulate the reasoning by which it is sought to show that the appellant's conviction was inevitable. Third, the inquiry to be made is whether a guilty verdict was inevitable, not whether a guilty verdict was open. (Whether the verdict was open is the question presented by s 276(1)(a).) If it is said that a guilty verdict was inevitable (which is to say a verdict of acquittal was not open), the Court of Appeal must decide that question on the written record of the trial with "the 'natural limitations' that exist in the case of any appellate court proceeding wholly or substantially on the record"21. That the jury returned a guilty verdict may, in appropriate cases22, bear upon the question. But, at least in cases like the present where evidence has wrongly been admitted at trial and cases where evidence has wrongly been excluded, the Court of Appeal could not fail to be satisfied that there has been a substantial miscarriage of justice unless it determines that it was not open to the jury to entertain a doubt as to guilt23. Otherwise, there has been a substantial miscarriage of justice because the result of the trial may have been different (because the state of the evidence before the jury would have been different) had the error not been made. This understanding of s 276 accommodates fundamental tenets of the criminal justice system in Australia. It recognises that the prescribed mode of trial was trial by jury. It does so by encompassing, within the expression "substantial miscarriage of justice", not only an error which possibly affected the result of the trial but also some departures from trial processes (sufficiently described for present purposes as "serious" departures), whether or not the impact of the departure in issue can be determined. It also recognises that an accused's guilt must be established by the prosecution at trial beyond reasonable doubt. It is not to be established24 by speculation about what a jury, this jury, or a reasonable jury might have done but for the error. Nothing short of satisfaction beyond reasonable doubt will do, and an appellate court can only be satisfied, on the record of the trial, that an error of the kind which occurred in this case did not amount to a "substantial miscarriage of justice" if the appellate court concludes 21 Fox v Percy (2003) 214 CLR 118 at 125-126 [23] (footnote omitted). 22 See generally Weiss (2005) 224 CLR 300 at 317 [43]; Baiada Poultry Pty Ltd v The Queen (2012) 86 ALJR 459 at 466 [28]; 286 ALR 421 at 430; [2012] HCA 14. 23 cf R v Grills (1910) 11 CLR 400 at 431 per Isaacs J; [1910] HCA 68. 24 cf Weiss (2005) 224 CLR 300 at 315-316 [37]-[40]. Hayne Crennan Bell from its review of the record that conviction was inevitable. It is the inevitability of conviction which will sometimes warrant the conclusion that there has not been a substantial miscarriage of justice with the consequential obligation to allow the appeal and either order a new trial or enter a verdict of acquittal. Extrinsic material the Bill which became The above conclusions follow from the text of the Act but they are reinforced by reference to extrinsic material related to the Act. In the course of the the second reading speech for Attorney-General said25 that the "new approach" adopted in the provisions that became s 276 "will result in appeals being allowed when the problem could have reasonably made a difference to the trial outcome; or if the error or irregularity was of a fundamental kind depriving the appellant of a fair trial" (emphasis added). This statement reinforces the view which follows from the statutory language: "a substantial miscarriage of justice" encompasses not only errors that did have or may have had an effect on the result of the trial but also departures from proper trial processes irrespective of their impact on the trial outcome. the Act, The second reading speech is useful in so far as it confirms that s 276 takes into account questions of result and questions of process, but it provides no further assistance than this. In particular, it may be doubted that the second reading speech contains an exhaustive description of the effect of what became s 276 because it left unexplained the references to "reasonably made a difference" and error or irregularity of a "fundamental" kind. And even if these comments in the second reading speech were to be taken as intended to be an exhaustive description, it is a description that could not and must not be adopted as a substitute for the statutory language. To ask when an error "could have reasonably made a difference", or to ask whether an error or irregularity is "fundamental", is simply to ask in different language whether there has been a "substantial miscarriage of justice". But it is the statutory question which must be asked and answered. Applying s 276(1)(b) in this case The error or irregularity at the appellant's trial was the refusal to sever the trial of the Rifat counts from the trial of the Srour count. The consequence of 25 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 4 December Hayne Crennan Bell that error or irregularity was that the jury heard prejudicial evidence about the appellant which would not have been admissible if the trials had been severed. On the trial of the Srour count, the jury heard all of the evidence of repeated demands with menaces made of Mr Rifat. On the trial of the Rifat counts, the jury heard Mr Srour's evidence that the appellant was a standover man and that the appellant had told him, in effect, that blackmail was how he (the appellant) got things. Unless this error or irregularity had no bearing upon the result of the trial, there was thus a "substantial miscarriage of justice" because the jury may have reached different conclusions had the record of evidence been different. The Court of Appeal ordered a retrial of the Srour count but it refused the appellant leave to appeal against the convictions recorded on the Rifat counts on the footing26 that there was not shown to have been a substantial miscarriage of justice. In refusing leave, the Court made essentially two points. First, the jury had been given a direction to consider each count separately by reference only to the evidence relating to that count and their return of different verdicts on different counts suggested that they had followed this direction27. This the Court of Appeal concluded28 outweighed what it described as the "over-dramatised" effect ascribed in the course of argument in that Court to the evidence given by Mr Srour. And second, on the Court's review of the record of the trial, the case against the appellant on the Rifat counts was said to be "very strong"29 and "overwhelming"30 because Mr Rifat's evidence "had credibility" and because it was "grossly improbable" that Mr Rifat would have willingly given the benefits he gave to the appellant and Mr Arafan31. The respondent supported this reasoning in this Court. But neither point demonstrates that the (now undisputed) failure to sever the trial of the Srour count from the trial of the Rifat counts did not result in a "substantial miscarriage of justice" with respect to the trial of the Rifat counts. 26 (2011) 213 A Crim R 382 at 398 [70]. 27 (2011) 213 A Crim R 382 at 398-399 [70]-[71]. 28 (2011) 213 A Crim R 382 at 398 [70]. 29 (2011) 213 A Crim R 382 at 398 [70]. 30 (2011) 213 A Crim R 382 at 403 [102]. 31 (2011) 213 A Crim R 382 at 403 [102]. Hayne Crennan Bell As to the first point, that the jury were given a separate consideration direction (whether or not that direction is properly characterised as a "strong"32 direction) does not deny that they had before them evidence which they should not have had and which may have influenced their deliberations. The Court of Appeal was therefore correct to conclude, as it did33, that the separate consideration direction did not prevent there being a substantial miscarriage of justice in respect of the trial of the Srour count. The same conclusion must be reached about the Rifat counts. As to the second point, it is of the utmost importance to recognise that the Court of Appeal's observations about the state of the evidence at trial were made in the course of considering the appellant's argument that the verdicts were unreasonable or could not be supported having regard to the evidence. It was in that context that Ashley JA said34: "the criticisms which [the appellant's] counsel made as to the state of the evidence do not bespeak a situation in which the jury should have had a reasonable doubt of the [appellant's] guilt. Having considered the evidence, I entertain no such doubt. ... [I]n my view the jury was in [sic] entitled to conclude, as I do, that the Crown case was overwhelming." (emphasis added) The point made by Ashley JA was directed to the ground raised: was the verdict open to the jury? And the conclusion which he reached was expressed in terms apposite to that ground: the jury should not have had a reasonable doubt and they were entitled to return the verdicts which they did. But the reasoning at no time considered, as s 276(1)(b) and (c) required, whether the jury's verdicts were not only open but inevitable. Conclusion and orders The appellant having demonstrated to the Court of Appeal that evidence was received at the trial of the Rifat counts that should not have been admitted, it was well open to the Court of Appeal to be satisfied that there was a substantial miscarriage of justice in respect of those counts. Whether, having regard to the 32 (2011) 213 A Crim R 382 at 398 [70]. 33 (2011) 213 A Crim R 382 at 399 [71]. 34 (2011) 213 A Crim R 382 at 403 [101]-[102]. Hayne Crennan Bell whole of the evidence at trial, the Court of Appeal could conclude that the verdicts the jury returned in respect of the Rifat counts were inevitable (because the jury could not have entertained a reasonable doubt) is a question which has not been considered by that Court. It cannot be decided by this Court because it does not have the full record of the trial available to it. Because the Court of Appeal did not examine whether the appellant's convictions on the Rifat counts were inevitable, the matter should be remitted to the Court of Appeal for it to consider again whether there was "a substantial miscarriage of justice" in respect of the Rifat counts. The appeal to this Court should be allowed and the matter remitted to the Court of Appeal for its further consideration. Introduction The "modern approach to statutory interpretation"35: "(a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses 'context' in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means … one may discern the statute was intended to remedy". (footnote omitted) That modern contextual approach ordinarily requires that statutory language re-enacted in an identical form after it has acquired a settled judicial meaning be taken to have the same meaning36. It equally requires that, changes of drafting style aside, statutory language re-enacted in an altered form after it has acquired a settled judicial meaning be taken to have a different meaning37. Were it otherwise, legislative policy choices would be blurred and orderly legislative reform would be impeded. The Supreme Court of Canada reflected that concern, even before the modern era of statutory interpretation, when it explained38: "when we see in statutes in pari materiâ, by the very same legislature, additional words ... to a prior enactment, we would be setting at naught the very clear intention of the legislature if we gave to the last enactment the same construction that had been judicially given to the prior one ... We cannot so read out of a statute expressions that must be held to have deliberately been inserted so as to make the new statute different from the prior one." Section 276 of the Criminal Procedure Act 2009 (Vic) was not cut from whole cloth. It was tailored from the common form criminal appeal statute which had existed in Victoria for almost a century. The similarities and 35 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; [1997] HCA 2. 36 Re Alcan Australia Ltd; Ex parte Federation of Industrial, Manufacturing and Engineering Employees (1994) 181 CLR 96 at 106; [1994] HCA 34. 37 Amalgamated Wireless (A/sia) Ltd v Philpott (1961) 110 CLR 617 at 624; [1961] HCA 31. 38 City of Ottawa v Hunter (1900) 31 SCR 7 at 10. differences of its language, and the difference of its structure, are relevant to its construction. They are essential features of its legislative design. Common form criminal appeal statute The common form criminal appeal statute, which derived from the Criminal Appeal Act 1907 (UK) and which continues to exist in most Australian States other than Victoria as well as in New Zealand39, requires a court of criminal appeal to allow an appeal against conviction "if it thinks" that one or more of three criteria is or are met and in any other case to dismiss the appeal. The three criteria were stated in a single unbroken sentence in successive versions of the common form criminal appeal statute in Victoria40. For ease of comparison with s 276, it is convenient nevertheless to assign a lettered paragraph to each criterion. The first – paragraph (a) – is that "the verdict of the jury should be set aside on the ground that it is unreasonable or cannot be supported having regard to the evidence". The second – paragraph (b) – is that "the judgment of the court before which the appellant was convicted should be set aside on the ground of a wrong decision of any question of law". The third – paragraph (c) – is that "on any ground there was a miscarriage of justice". The requirement for a court of criminal appeal to allow the appeal if it thinks that one or more of those criteria is or are met is expressed to be subject to a proviso. The proviso is that, notwithstanding that the court of criminal appeal is of the opinion that the point or points raised by the appeal might be decided in favour of the appellant, the court may dismiss the appeal "if it considers that no substantial miscarriage of justice has actually occurred". The common form criminal appeal statute is therefore structured so as to require a court of criminal appeal first to determine whether or not it thinks that one or more of the three criteria requiring it to allow an appeal against conviction is or are met and, if so, then to determine whether or not it considers that no substantial miscarriage of justice has actually occurred so as to be able nevertheless to dismiss the appeal in the application of the proviso. There has never been doubt that a court of criminal appeal making those determinations performs a curial function distinct from that of a jury41. Nor has there ever been doubt that the court of criminal appeal necessarily performs that function 39 Criminal Appeal Act 1912 (NSW), s 6(1); Criminal Code (Q), s 668E; Criminal Law Consolidation Act 1935 (SA), s 353(1); Criminal Code (Tas), s 402; Crimes Act 1961 (NZ), s 385(1). 40 Criminal Appeal Act 1914 (Vic), s 4(1); Crimes Act 1958 (Vic), s 568(1). 41 R v Weaver (1931) 45 CLR 321 at 333; [1931] HCA 23. "according to its [own] assessment of the facts of the case"42, "making due allowance for the 'natural limitations' that exist in the case of an appellate court proceeding wholly or substantially on the record"43. The content of each criterion and the relationship between each criterion and the proviso, on the other hand, has been the subject of voluminous and evolving judicial exegesis. With respect to the criterion in paragraph (a) of the common form criminal appeal statute – that "the verdict of the jury should be set aside on the ground that it is unreasonable or cannot be supported having regard to the evidence" – the now settled understanding is that the question a court of criminal appeal must ask itself is "whether it thinks that upon the whole of the evidence it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty"44. In answering that question, a doubt experienced by the court of criminal appeal on the basis of its own independent review and assessment of the evidence "will be a doubt which a jury ought also to have experienced" unless the "jury's advantage in seeing and hearing the evidence is capable of resolving [the] doubt experienced by [the] court"45. The conclusion of a court of criminal appeal that it was not open to the jury to be satisfied beyond reasonable doubt that the accused was guilty inevitably involves a conclusion that a substantial miscarriage of justice has actually occurred: the substantial miscarriage of justice having long been identified as lying in the existence of "a significant possibility that an innocent person has been convicted"46. The proviso has for that reason been treated as having no potential for application where the criterion in paragraph (a) is made out. The criterion in paragraph (b) of the common form criminal appeal statute – that "the judgment of the court before which the appellant was convicted should be set aside on the ground of a wrong decision of any question of law" – has always been understood to have the effect that "if there is a wrong decision of any question of law the appellant has the right to have his appeal allowed, unless the case can be brought within the proviso"47. And it has always been understood 42 Wilde v The Queen (1988) 164 CLR 365 at 372; [1988] HCA 6. See also Ratten v The Queen (1974) 131 CLR 510 at 515-516; [1974] HCA 35. 43 Weiss v The Queen (2005) 224 CLR 300 at 316 [41]; [2005] HCA 81, citing Fox v Percy (2003) 214 CLR 118 at 125-126 [23]; [2003] HCA 22. 44 M v The Queen (1994) 181 CLR 487 at 493; [1994] HCA 63. 45 (1994) 181 CLR 487 at 494. 46 (1994) 181 CLR 487 at 494. 47 Mraz v The Queen (1955) 93 CLR 493 at 514; [1955] HCA 59, quoting Cohen and Bateman v The King (1909) 2 Cr App R 197 at 207. that it is for the respondent and not the appellant to establish to the satisfaction of the court of criminal appeal that the case is within the proviso48 – that "no substantial miscarriage of justice has actually occurred". For a very long time it was understood to be an essential condition of that satisfaction that the respondent persuade the court that the wrong decision of the question of law did not deprive the appellant of a chance of acquittal that would have been fairly open. The underlying understanding was that "every accused person is entitled to a trial in which the relevant law is correctly explained to the jury and the rules of procedure and evidence are strictly followed"49. On that understanding, loss of a chance of acquittal that would otherwise have been fairly open amounted, without more, to a substantial miscarriage of justice. If the respondent failed to show that a wrong decision of a question of law did not deprive the appellant of a chance of acquittal that would otherwise have been fairly open, the court of criminal appeal could not conclude that no substantial miscarriage of justice had actually occurred50. One formulation of the essential condition was in terms that the appeal was to be allowed and the conviction set aside unless the respondent could establish that "had there been no blemish in the trial, an appropriately instructed jury, acting reasonably on the evidence properly before them and applying the correct onus and standard of proof, would inevitably have convicted the accused"51. The formulation left open a question (in practice rarely determinative) as to whether the inevitability of conviction was to be gauged by reference to the actual trial jury (acting reasonably) or to a hypothetical jury (acting reasonably)52. In 2005, Weiss v The Queen53 overturned that understanding of the essential condition of the respondent persuading the court of criminal appeal that "no substantial miscarriage of justice has actually occurred". Weiss was a case in which consideration of the proviso arose because the paragraph (b) criterion had been made out. As reformulated, the essential condition became that the court of criminal appeal itself be persuaded "that the evidence properly admitted at trial proved, beyond reasonable doubt, the accused's guilt of the offence on which the 48 Mraz v The Queen (1955) 93 CLR 493 at 514, quoting Cohen and Bateman v The King (1909) 2 Cr App R 197 at 207. 49 Mraz v The Queen (1955) 93 CLR 493 at 514. 50 Wilde v The Queen (1988) 164 CLR 365 at 371-372. 51 (1988) 164 CLR 365 at 372. 52 R v Weiss (2004) 8 VR 388 at 400-401 [70]. 53 (2005) 224 CLR 300. jury returned its verdict of guilty"54. The reasons given in Weiss for that reformulation included: that such entitlement as an accused person may have to the verdict of a jury is necessarily qualified by the possibility of appellate intervention so that the real question is ultimately whether appellate intervention is justified by the statutory language55; that "any departure from trial according to law, regardless of the nature or importance of that departure" (emphasis in original) is necessarily a "miscarriage of justice"56; and that important to the construction and application of the proviso are both its "permissive language" and "the way in which the condition for the exercise of [the] power is expressed (if it considers that no substantial miscarriage of justice has actually occurred)" (emphasis in original)57. The reformulation in Weiss must, of course, be applied by courts of criminal appeal "[u]nless, and until, a majority of this Court qualifies what is said in [it]"58. However, it is by no means apparent that the Weiss reformulation has any application to a statutory provision in which the criteria for appellate intervention are differently expressed, in which the appellant in every case bears the burden of persuading the court of criminal appeal that a criterion is met, and in which errors of law are governed by the same criterion as other errors and "irregularities". The criterion in paragraph (c) of the common form criminal appeal statute – that "on any ground there was a miscarriage of justice" – has always been significant to an appreciation of the innovation involved in the common form criminal appeal statute. It is even more significant to an appreciation of the further innovation involved in s 276. The requirement for a court of criminal appeal, subject to the proviso, to allow an appeal against a conviction on demonstration by an appellant of a miscarriage of justice other than "an error in strict law" was said to have been "the greatest innovation" made by the common form criminal appeal statute, to lose sight of which "is to miss the point of the legislative advance"59. It has been observed that the English court of criminal 54 (2005) 224 CLR 300 at 317 [44]. See also Cooper v The Queen [2012] HCA 50 at 55 (2005) 224 CLR 300 at 312 [30]. 56 (2005) 224 CLR 300 at 308 [18]. 57 (2005) 224 CLR 300 at 317 [44]. 58 Libke v The Queen (2007) 230 CLR 559 at 597 [115]; [2007] HCA 30. 59 Hargan v The King (1919) 27 CLR 13 at 23; [1919] HCA 45, quoted in M v The Queen (1994) 181 CLR 487 at 493. appeal "[f]rom the beginning" consistently regarded its "duty to quash a conviction when it [thought] that on any ground there was a miscarriage of justice" as "covering not only cases where there is affirmative reason to suppose that the appellant is innocent, but also cases of quite another description"60. Applying the criterion in paragraph (c) of the common form criminal appeal statute, it would61: "set aside a conviction whenever it appear[ed] unjust or unsafe to allow the verdict to stand because some failure [had] occurred in observing the conditions which, in the court's view, [were] essential to a satisfactory trial, or because there [was] some feature of the case raising a substantial possibility that, either in the conclusion itself, or in the manner in which it has been reached, the jury may have been mistaken or misled". The same approach was adopted by courts of criminal appeal in Australia. The words "on any ground" in paragraph (c) of the common form criminal appeal statute "do not postulate the demonstration of error" but rather "simply require that 'something occurred or did not occur' in the trial"62. The thing that occurred or did not occur in the trial may be an "irregularity" falling short of a failure to observe some condition essential to a satisfactory trial – such as a misdirection or non-direction of fact63 or what is shown to have been at the time of exercise64 or in the light of developments at the trial65 a wrong but legally available exercise of judicial discretion resulting in the admission of evidence prejudicial to the appellant. In those circumstances, it has been accepted that the criterion in paragraph (c) will be made out only where the appellant is able to establish a causal connection between the irregularity and the conviction in the sense that, but for the irregularity, the result might have been different and the appellant 60 Davies and Cody v The King (1937) 57 CLR 170 at 180; [1937] HCA 27, quoted in Nudd v The Queen (2006) 80 ALJR 614 at 617 [4]; 225 ALR 161 at 162; [2006] HCA 9. 61 Davies and Cody v The King (1937) 57 CLR 170 at 180, quoted in Nudd v The Queen (2006) 80 ALJR 614 at 617 [4]; 225 ALR 161 at 162. 62 TKWJ v The Queen (2002) 212 CLR 124 at 134 [30]; [2002] HCA 46, quoting R v Scott (1996) 137 ALR 347 at 362-363. 63 See Cohen and Bateman v The King (1909) 2 Cr App R 197 at 207; Simic v The Queen (1980) 144 CLR 319 at 326; [1980] HCA 25; Dhanhoa v The Queen (2003) 217 CLR 1 at 13 [38], 15 [49], 18 [60]; [2003] HCA 40. 64 See R v Gallagher [1998] 2 VR 671 at 679-680. 65 See R v Demirok [1976] VR 244. might have been acquitted66. Before Weiss, it also appears to have been accepted that, by establishing that the irregularity might have affected the conviction that actually occurred, the appellant would succeed not only in making out the criterion in paragraph (c) but also in negating the application of the proviso. In Simic v The Queen67, for example, the irregularity that occurred in the trial was described as "a misstatement of an important matter of fact"68. After making clear that the onus of establishing a miscarriage of justice lay with the appellant, the Court said69: "Of course minor inaccuracies and omissions will not be likely to make it possible that the verdict was affected. Bare and remote possibilities may be disregarded, but if it is considered reasonably possible that the misstatement may have affected the verdict and if the jury might reasonably have acquitted the appellant if the misstatement had not been made, there will have been a miscarriage of justice, and a substantial one. In considering a question of this kind, the appellate court must have regard to the gravity of the misstatement as well as to the strength of the case against the appellant." In this way, as the Court of Appeal of the Supreme Court of Victoria observed in 1997, courts had "been able to apply this legislation for almost a century without ... finding it necessary to decide what, if anything, is the difference between a miscarriage of justice and a substantial miscarriage of justice"70. Acknowledgment of the difference in approach required in the application of the criterion in paragraph (c) of the common form criminal appeal statute from that required in the application of the criterion in paragraph (b) underlay one of the qualifications made by the Supreme Court of New Zealand to its acceptance 66 TKWJ v The Queen (2002) 212 CLR 124 at 146-147 [72]-[73]; Dhanhoa v The Queen (2003) 217 CLR 1 at 13 [38], 15 [49], 18 [60]. 67 (1980) 144 CLR 319. 68 (1980) 144 CLR 319 at 326. 69 (1980) 144 CLR 319 at 332. 70 R v Gallagher [1998] 2 VR 671 at 679. See also TKWJ v The Queen (2002) 212 CLR 124 at 146 [71]. of Weiss in R v Matenga71. Referring specifically to paragraph (c), the Supreme Court stated72: "Few trials are perfect in all respects. Frequent use of the proviso may create the false impression that the appeal court is too ready to resort to it despite the existence of a miscarriage of justice. In the end, departing in this respect from Weiss, we consider that in the first place the appeal court should put to one side and disregard those irregularities which plainly could not, either singly or collectively, have affected the result of the trial and therefore cannot properly be called miscarriages. A miscarriage is more than an inconsequential or immaterial mistake or irregularity." Applying Weiss subject to that qualification, the Supreme Court went on73: "Proceeding in this way and having identified a true miscarriage, that is, something which has gone wrong and which was capable of affecting the result of the trial, the task of the Court of Appeal under the proviso is then to consider whether that potentially adverse effect on the result may actually, that is, in reality, have occurred. The Court may exercise its discretion to dismiss the appeal only if, having reviewed all the admissible evidence, it considers that, notwithstanding there has been a miscarriage, the guilty verdict was inevitable, in the sense of being the only reasonably possible verdict, on that evidence. ... In order to come to the view that the verdict of guilty was inevitable the Court must itself feel sure of the guilt of the accused." (emphasis in original) (footnotes omitted) The reasoning of the plurality in Cesan v The Queen74 in substance adopted the same qualified approach. That reasoning illustrates that, after Weiss, the application of the criterion in paragraph (c) of the common form criminal appeal statute where there is an irregularity falling short of a failure to observe some condition essential to a satisfactory trial still requires the appellant to establish that the irregularity might have affected the result75. However, the same reasoning also illustrates that, after Weiss, the appellant will not thereby necessarily succeed in negating the application of the proviso. It remains open to 71 [2009] 3 NZLR 145. 72 [2009] 3 NZLR 145 at 157 [30]. 73 [2009] 3 NZLR 145 at 158 [31]. 74 (2008) 236 CLR 358; [2008] HCA 52. 75 (2008) 236 CLR 358 at 391-393 [112]-[122]. the court of criminal appeal to apply the proviso to uphold the conviction if the court can nevertheless be persuaded to conclude that the evidence properly admitted at trial proved the appellant's guilt beyond reasonable doubt76. Interpreting and applying s 276 Section 276 is set out in the reasons for judgment of the majority and is not usefully set out again. Some features of the legislative design of s 276 are readily apparent from its text and internal structure. First, s 276(2) makes clear that the criteria by reference to which the Court of Appeal can allow an appeal against conviction are exhaustively stated in s 276(1). Second, the opening words and internal structure of s 276(1) make clear that the Court of Appeal must allow an appeal if satisfied that any one or more of the criteria in paragraphs (a), (b) and (c) is or are met. They also make clear that the onus is in every case on the appellant to satisfy the Court that such a criterion is met. Third, the structure of paragraphs (a), (b) and (c) of s 276(1) also indicates that the common characteristic of the criteria they set out is a circumstance in which "there has been a substantial miscarriage of justice": paragraphs (a) and (b) cover particular circumstances where there will have been a substantial miscarriage of justice and paragraph (c) covers circumstances where "for any other reason" there has been a substantial miscarriage of justice. Other features of the legislative design of s 276 come into focus when its text and structure are compared with those of the common form criminal appeal statute. The focus is sharper when its text and structure are studied in light of the settled understanding and continuing uncertainties that had come to exist by 2009 in the interpretation and application of the common form criminal appeal statute. The criterion in paragraph (a) of s 276(1) is expressed in language identical to the criterion in paragraph (a) of the common form criminal appeal statute. It is therefore to be taken to have the same meaning as that which has been settled for paragraph (a) of the common form criminal appeal statute. An appellant is to satisfy the Court of Appeal that on the whole of the evidence it was not open to the jury to be satisfied beyond reasonable doubt that the appellant was guilty. That is to say, the appellant must satisfy the Court of Appeal on the whole of the evidence that the jury must (as distinct from might) have entertained a reasonable doubt. The criterion in paragraph (b) of s 276(1), in contrast, is expressed in language materially different from the criterion in paragraph (b) of the common form criminal appeal statute. Moreover, the language in which the criterion is 76 (2008) 236 CLR 358 at 393-396 [123]-[132]. expressed draws on concepts that have been employed by courts of criminal appeal to explain and apply the criterion in paragraph (c) of the common form criminal appeal statute. The criterion in paragraph (b) of s 276(1) has two critical features. First, the criterion is addressed to "an error or an irregularity in, or in relation to, the trial". It treats all errors or irregularities, whether of fact or of law, in the same way. It neither incorporates nor gives rise to any presumption that an erroneous decision on a question of law amounts to a miscarriage of justice. Whether or not an error or irregularity has resulted in a substantial miscarriage of justice is the very question it poses. Second, curial satisfaction that the criterion is met does not turn simply on satisfaction that: (a) the error or irregularity has occurred; and (b) there has been a substantial miscarriage of justice. It turns critically on satisfaction of the existence of a causal connection between the error or irregularity and a substantial miscarriage of justice: that there has been a substantial miscarriage of justice "as the result" of the error or irregularity. The same requirement for satisfaction of a causal connection with a substantial miscarriage of justice is evident in the language of the criterion in paragraph (c) of s 276(1): that there has been a substantial miscarriage of justice "for any other reason". Applying the criterion in paragraph (b) of s 276(1) in the face of an identified error or irregularity, the question for the Court of Appeal is not: is the Court satisfied that there has been a substantial miscarriage of justice? The question, so stated, is too abstract and unfocused. It is apt to engage the Court of Appeal in an inquiry of a nature that is broader than and different from that which is warranted by the statutory language. The question for the Court of Appeal is narrower and more specific: is the Court satisfied by the appellant that the identified error or irregularity has had the result that there has been a substantial miscarriage of justice? That question is essentially the question that was asked by a court of criminal appeal applying the criterion in paragraph (c) of the common form criminal appeal statute before Weiss in the face of a demonstrated irregularity. The difference, at most one of degree, is the substitution of "substantial miscarriage of justice" for "miscarriage of justice". In what circumstances should the Court of Appeal be satisfied that an identified error or irregularity has had the result that there has been a substantial miscarriage of justice? "Miscarriage is not defined in the legislation but its significance is fairly worked out in the decided cases"77. The long experience of 77 Ratten v The Queen (1974) 131 CLR 510 at 516, quoted in Nudd v The Queen (2006) 80 ALJR 614 at 617 [5]; 225 ALR 161 at 162. courts of criminal appeal, in applying the criterion in paragraph (c) of the common form criminal appeal statute and in applying the proviso, suggests that it would be unwise, even if it were possible, to attempt to be exhaustive. Equally, that experience permits recognition of two categories of circumstances in which an identified error or irregularity can ordinarily be said to have had such a result. One category, relatively narrow in compass78, is where the error or irregularity has impacted on some fundamental aspect of the trial process: where there has been non-observance of some condition essential to a satisfactory trial. The other, more general, category is where the error or irregularity has impacted negatively on the trial outcome: where, but for the error or irregularity, the appellant might have been acquitted. Applying the criterion in paragraph (b) of s 276(1) in the face of an identified error or irregularity, and leaving to one side a case where the error or irregularity has impacted on some fundamental aspect of the trial process, the critical question for the Court of Appeal is ordinarily therefore: is the Court satisfied by the appellant that, but for the error or irregularity, the appellant might have been acquitted? The question is whether there is a reasonable possibility that the conviction, being open, would not have been entered if the error or irregularity had not occurred. Where the appellant has been found guilty by a jury, the question therefore is not: did the evidence properly admitted at trial require the jury to reach the conclusion that the appellant was guilty? It is not: would acquittal have been perverse? The question is rather: is it reasonably possible that the jury that actually convicted the appellant would have acquitted the appellant if the error or irregularity had not occurred? The question is to be answered having regard to the gravity of the error or irregularity in the context of the trial as a whole, including the strength of the case against the appellant and the manner in which the jury can be inferred to have reached the verdict that it did. Stating the question in that way accords with the language and structure of paragraph (b) of s 276(1). More particularly, it gives weight to the similarities and differences in the language and structure of paragraph (b) of s 276(1) when compared with the common form criminal appeal statute. It departs in practice from the approach in Weiss because the legislative foundation for that approach has been removed. Stating the question in that way also accords with the legislative intention revealed in the relevant extrinsic materials. The explanatory memorandum to the Criminal Procedure Bill 2008 (Vic) explained that compared to the common form criminal appeal provision, s 276 78 Green v The Queen (1997) 191 CLR 334 at 346-347; [1997] HCA 50. "has been substantially changed as a result of a review of the grounds of appeal against conviction and the proviso"79. After adverting to the decision in Weiss, the explanatory memorandum went on to explain that s 276 "simplifies the appeal grounds without departing from the overall 'substantial miscarriage of justice' test"80. The explanatory memorandum said that "the current first ground of appeal is fundamentally sound"81 but that82: "errors or irregularities in the trial should result in appeals being allowed when the problem could have reasonably made a difference to the trial outcome; or if the error or irregularity was of a fundamental kind depriving the appellant of a fair trial or amounting to an abuse of process (regardless of whether it could have made a difference to the trial outcome)". It also emphasised that "the onus to persuade the court of the matters required for a successful appeal should be on the appellant" because "there is a presumption that, until the contrary is shown, a trial before judge and jury was fair and in accordance with law"83. In his second reading speech the Victorian Attorney-General observed that the common form criminal appeal statute, as then existing in Victoria, had been "drafted approximately 100 years ago", that the meaning of some of its words was unclear, that it was internally inconsistent and that Weiss had "added a level of complexity and uncertainty" to its application84. He added85: 79 Victoria, Legislative Assembly, Criminal Procedure Bill 2008, Explanatory Memorandum at 100. 80 Victoria, Legislative Assembly, Criminal Procedure Bill 2008, Explanatory Memorandum at 101. 81 Victoria, Legislative Assembly, Criminal Procedure Bill 2008, Explanatory Memorandum at 101. 82 Victoria, Legislative Assembly, Criminal Procedure Bill 2008, Explanatory Memorandum at 102. 83 Victoria, Legislative Assembly, Criminal Procedure Bill 2008, Explanatory Memorandum at 101. 84 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 4 December 85 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 4 December "The provision and recent High Court authority also do not necessarily operate on the presumption that a trial before a judge and jury was conducted fairly and in accordance with law unless the appellant shows that it was not." "The bill addresses the fundamental problems that have plagued this provision. The bill will improve the operation and application of appeals against conviction ... by: removing the two-stage test and replacing it with a single stage test; retaining the 'substantial miscarriage of justice' test for determining whether an appeal should be allowed or refused. This is an appropriate test for determining when an appeal should be allowed; and requiring the appellant to satisfy the court that the appeal should be allowed. The new approach will mean that errors or irregularities in the trial will result in appeals being allowed when the problem could have reasonably made a difference to the trial outcome; or if the error or irregularity was of a fundamental kind depriving the appellant of a fair trial. The appeal process will therefore operate to ensure that the accused receives a fair trial. It will also ensure that appeals will not be allowed on technical points that did not affect the outcome of the trial or the fairness of the proceeding." (emphasis added) To formulate the question for the Court of Appeal, applying the criterion in paragraph (b) of s 276(1) in the face of an identified error or irregularity, in terms of whether a jury verdict was "inevitable" may not be inappropriate in the circumstances of a particular case, provided the concept of "inevitability" is used in the sense of referring to the absence of a reasonable possibility of a different verdict. But the formulation is best avoided. It runs the risk of misapplying the onus and of overlooking the necessity for a causal connection to be affirmatively established. It thereby runs the risk of broadening the appellate inquiry and, with that, the scope for appellate intervention, beyond the statutory mandate. 86 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 4 December The result in the appeal The essential facts are set out in the reasons for judgment of the majority. The conclusion of the Court of Appeal, as expressed by Ashley JA, was that "it cannot be said that any substantial miscarriage was occasioned to the applicant in respect of the Rifat counts by reason of the refusal to sever"87. The reasons for that conclusion, in substance, were as follows. The verdicts of guilty on the Rifat counts were open on the evidence that was properly admitted on those counts. The prosecution case on those counts was "very strong", indeed "overwhelming"88. The trial judge had given a clear direction that evidence on the Srour count was not to be taken into account in determining the Rifat counts89. There was no reason to consider that the jury failed to heed that direction. And "[t]he course of the jury's verdicts, which must be brought to consideration, strongly suggests that it gave separate consideration to each count, and only found a count established where the evidence of guilt of the particular accused was clear-cut"90. The conclusion of the Court of Appeal, and the reasons stated for it, reveal no error of principle. Special leave to appeal having been granted, however, the question in the appeal is not limited to one of principle. The grounds of appeal also include a limited challenge to the Court of Appeal's application of principle. The ultimate question in the appeal is whether this Court, standing in the shoes of the Court of Appeal, is satisfied on the arguments presented by the appellant that there is a reasonable possibility that, but for the failure to sever, the jury would have acquitted on the Rifat counts. On the arguments presented by the appellant, it should not be satisfied. It may be accepted that Mr Srour's evidence that the appellant was "a standover man" and that the appellant had told Mr Srour that he bullied and assaulted people "to get things" was highly prejudicial. Notwithstanding the strength of the trial judge's direction, it is difficult to conceive that the jury could have wholly ignored the evidence in returning guilty verdicts on the Rifat counts. It is by no means clear that the Court of Appeal drew any inference that the jury did ignore that evidence. If the Court of Appeal drew that inference, the Court of Appeal should not have done so. 87 Baini v The Queen (2011) 213 A Crim R 382 at 398 [70]. 88 (2011) 213 A Crim R 382 at 398 [70], 403 [102]. 89 (2011) 213 A Crim R 382 at 398 [70]. 90 (2011) 213 A Crim R 382 at 398-399 [70]. That, argues the appellant, is enough for the appeal to be allowed: "it is inappropriate to consider whether the failure to sever would have made a difference to the outcomes on the Rifat counts". The argument must be rejected. Accepting that the jury is unlikely to have ignored Mr Srour's evidence in returning guilty verdicts on the Rifat counts, it remains for the appellant to establish a reasonable possibility that the jury would have acquitted the appellant had Mr Srour's evidence not been placed before it. The question is not whether it would have been perverse for the jury to acquit the appellant on the evidence properly admitted on the Rifat counts. The question is whether there is shown to be a reasonable possibility that the guilty verdicts on the Rifat counts that were in fact returned by the jury, being open, would not have been returned if the Srour count had been severed and if Mr Srour's evidence had not been placed before the jury. The appellant has not challenged the findings of the Court of Appeal that the verdicts of guilty on the Rifat counts were open on the evidence properly admitted on those counts and that the prosecution case on those counts was overwhelming. The jury undertook its task diligently, acquitting the appellant on some counts, but finding guilt where the evidence was strong. Accepting that the jury is unlikely to have ignored Mr Srour's evidence in returning guilty verdicts on the Rifat counts, the appellant has not shown there to be a reasonable possibility that he would have been acquitted on the Rifat counts if Mr Srour's evidence had not been placed before the jury. The appeal should be dismissed.
HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Park v The Queen [2021] HCA 37 Date of Hearing: 2 September 2021 Date of Judgment: 10 November 2021 ORDER Appeal dismissed. On appeal from the Supreme Court of New South Wales Representation B J Rigg SC with J S Paingakulam for the appellant (instructed by Legal Aid NSW) H Baker SC with B K Baker and K M Jeffreys for the respondent (instructed by Solicitor for Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Park v The Queen Criminal law – Sentence – Plea of guilty – Where appellant sentenced in District Court of New South Wales for multiple offences including taking a conveyance without consent of owner contrary to s 154A(1)(a) of Crimes Act 1900 (NSW) ("offence") – Where maximum penalty for offence five years' imprisonment – Where offence dealt with as a "related offence" under s 165 of Criminal Procedure Act 1986 (NSW) – Where sentencing court subject to jurisdictional limit of two years' imprisonment for offence – Where s 22(1) of Crimes (Sentencing Procedure) Act 1999 (NSW) provided sentencing court may impose lesser penalty than it would otherwise have imposed but for plea of guilty – Where sentencing judge awarded 25% discount for guilty plea for offence – Where indicative sentence of two years and eight months' imprisonment exceeded jurisdictional limit – Whether sentence that court "would otherwise have imposed" can exceed jurisdictional limit. Words and phrases – "aggregate sentence", "appropriate sentence", "discount to the sentence", "guilty plea", "indicative sentence", "jurisdictional limit", "lesser penalty than it would otherwise have imposed", "maximum penalty", "plea of guilty", "sentence in excess of the jurisdictional limit". Crimes (Sentencing Procedure) Act 1999 (NSW), ss 21A, 22(1), 53A. Criminal Procedure Act 1986 (NSW), ss 168(3), 268(1A). KIEFEL CJ, GAGELER, KEANE, EDELMAN AND GLEESON JJ. This appeal concerns the correct interpretation of s 22 of the Crimes (Sentencing Procedure) Act 1999 (NSW) ("the Sentencing Act"), which prescribes the manner in which certain courts, including, relevantly, the District and Local Courts of New South Wales, are required to take into account an offender's guilty plea in passing sentence. At the time of the relevant offending, s 22 provided: In passing sentence for an offence on an offender who has pleaded guilty to the offence, a court must take into account – the fact that the offender has pleaded guilty, and (b) when the offender pleaded guilty or indicated an intention to plead guilty, and the circumstances in which the offender indicated an intention to plead guilty, and may accordingly impose a lesser penalty than it would otherwise have imposed. (1A) A lesser penalty imposed under this section must not be unreasonably disproportionate to the nature and circumstances of the offence. (2) When passing sentence on such an offender, a court that does not impose a lesser penalty under this section must indicate to the offender, and make a record of, its reasons for not doing so. Subsection (2) does not limit any other requirement that a court has, apart from that subsection, to record the reasons for its decisions. The failure of a court to comply with this section does not invalidate any sentence imposed by the court." When s 22 is read in its context, the sentence that the court "would otherwise have imposed" in s 22(1) is the sentence that the court would otherwise have imposed in accordance with the Sentencing Act. That sentence is determined without regard to any jurisdictional limit affecting the court's sentencing power under the Criminal Procedure Act 1986 (NSW) ("the Criminal Procedure Act"). Any relevant jurisdictional limit is applied by the sentencing judge after the judge has determined the appropriate sentence for the offence. The majority of the Court Edelman Gleeson of Criminal Appeal of the Supreme Court of New South Wales correctly interpreted s 22 and, accordingly, the appeal must fail. Background to appeal On 6 November 2018, the appellant was sentenced in the District Court of New South Wales to an aggregate sentence of imprisonment of 11 years, with a non-parole period of eight years, for multiple offences including an offence of taking a conveyance without the consent of the owner contrary to s 154A(1)(a) of the Crimes Act 1900 (NSW) ("the offence"). The offence was dealt with as a "related offence" within the meaning of s 165 of the Criminal Procedure Act and the appellant pleaded guilty to the offence. The maximum penalty for the offence was five years' imprisonment1 but the District Court's sentencing power was affected by s 168(3) of the Criminal Procedure Act, which provided: "In sentencing or otherwise dealing with a person for a back up offence or related offence, the court has the same functions, and is subject to the same restrictions and procedures, as the Local Court." By s 268(1A) of the Criminal Procedure Act, the maximum term of imprisonment that the Local Court could have imposed for the offence was two years. The combined operation of ss 168(3) and 268(1A) was to impose a jurisdictional limit upon the District Court of two years' imprisonment in sentencing the appellant for the offence ("the jurisdictional limit"). As the sentencing judge (Judge Bennett) imposed an aggregate sentence in accordance with s 53A of the Sentencing Act, his Honour was required by s 53A(2)(b) to indicate "the sentence that would have been imposed for each offence (after taking into account such matters as are relevant under Part 3 or any other provision of this Act) had separate sentences been imposed instead of an aggregate sentence". His Honour indicated a sentence of two years' imprisonment for the offence after "applying a discount of 25%" and noted that he had "applied a 25% discount to the sentence that would have otherwise been imposed" to reflect the utility of the appellant's early plea of guilty. As all members of the Court of Criminal Appeal inferred, but for the appellant's guilty plea, his Honour's 1 Crimes Act 1900 (NSW), ss 116, 117, 154A. Edelman Gleeson indicative sentence would have been two years and eight months' imprisonment, being a sentence in excess of the jurisdictional limit2. The 25% discount conforms with R v Thomson3, the Court of Criminal Appeal's guideline judgment for imposing a sentence in accordance with s 22 where a plea of guilty is entered. R v Thomson states that the utilitarian value of a plea to the criminal justice system should generally be assessed in the range of 10-25% discount on a sentence4. The appellant's appeal against sentence was dismissed by the Court of Criminal Appeal (Bathurst CJ and R A Hulme J, Fullerton J dissenting). The majority concluded that the sentencing judge proceeded in "the orthodox and correct fashion" in assessing the appropriate sentence for the offence within the context of the prescribed maximum penalty, synthesising all relevant facts and circumstances with any discount for the guilty plea then applied5. If that sentence exceeded a jurisdictional limit, it was then necessary to reduce it to be within the limit. In dissent, Fullerton J considered that s 22(1) obliges a sentencing court to apply the discount allowed for the plea of guilty to a sentence that the court would in fact have imposed but for the guilty plea and, where there is a jurisdictional limit for a particular offence, the court is to have regard to that limit when applying the discount6. The majority's approach was first stated by the Court of Criminal Appeal in 2008 in Lapa v The Queen7, a decision followed by the Court of Appeal of the 2 Park v The Queen (2020) 282 A Crim R 551 at 553 [3], 578 [130], 586 [169]. (2000) 49 NSWLR 383. (2000) 49 NSWLR 383 at 418 [152], 419 [160]. 5 Park v The Queen (2020) 282 A Crim R 551 at 560 [32], 591-592 [197], [202]. See also Wong v The Queen (2001) 207 CLR 584 at 611-612 [74]-[76]; Markarian v The Queen (2005) 228 CLR 357 at 373-375 [37], 377-378 [51], 387 [73]. 6 Park v The Queen (2020) 282 A Crim R 551 at 581 [142]. (2008) 192 A Crim R 305 at 309 [17]. Edelman Gleeson Supreme Court of Western Australia8. Without referring to Lapa v The Queen, in Mundine v The Queen the Court of Criminal Appeal concluded that the jurisdictional limit did not apply prior to the discount for a plea of guilty9. The appellant accepted that, if his interpretation of s 22 is correct, then the Court of Criminal Appeal's decisions in Lapa v The Queen and Mundine v The Queen were wrong. More recently, in Hanna v The Queen, Bell P and R A Hulme J applied the decision under appeal10. Although Simpson A-JA concluded that adherence to precedent required that approach, her Honour expressed a preference for Appellant's argument The appellant argued that the majority of the Court of Criminal Appeal erred in interpreting the phrase "it would otherwise have imposed" in s 22, and contended that Fullerton J's interpretation in dissent was correct. That is, the indicative sentence for the offence was said to reveal error on the part of the sentencing judge because, by reason of the jurisdictional limit, two years and eight months' imprisonment was not a sentence that his Honour "would otherwise have imposed". The appellant argued that, on the plain and natural meaning of s 22, the sentencing court is empowered to "impose a lesser penalty" which is "[a] lesser penalty imposed under this section"12. If a court seeks to exercise the s 22 power in the offender's favour, it must impose a penalty that is less than it could (and therefore would) otherwise impose in passing sentence. Where the sentencing court is subject to a jurisdictional limit (apart from the maximum penalty imposed 8 Wiltshire v Mafi (2010) 211 A Crim R 326 at 333 [29]. [2017] NSWCCA 97 at [19], [67], [92]. (2020) 102 NSWLR 244 at 245 [1]-[5], 258 [99]. 11 Hanna v The Queen (2020) 102 NSWLR 244 at 256-257 [85]-[87]. 12 Crimes (Sentencing Procedure) Act 1999 (NSW), s 22(1A). Edelman Gleeson for the offence), the court's capacity to "impose a lesser penalty" will necessarily be affected by the jurisdictional limit. Further, the appellant argued, s 22 should be interpreted consistently with s 53A(2) of the Sentencing Act, which was held in Mundine v The Queen13 to require a court to state an indicative sentence for each offence not exceeding the court's jurisdictional limit for the offence when it imposes an aggregate sentence for multiple offences under s 53A(1). As noted above, this argument does not find support in Mundine v The Queen, where the Court of Criminal Appeal accepted that the jurisdictional limit did not apply to "the starting point prior to the discount for the plea"14. The appellant argued that his interpretation promotes the purpose of s 22, namely, to encourage offenders to plead guilty, with consequent utilitarian benefits including saving court time and reducing burdens on victims, police, courts and others. According to the appellant, the purpose of s 22 is fulfilled where it results in visible rewards for guilty pleas. Conversely, the purpose is defeated if the offender's guilty plea does not result in a reduced sentence, except in cases where the sentencing judge has positively determined not to impose a lesser penalty under The proper construction On its face, and if s 22 is read apart from its context, the appellant's interpretation is plausible. However, the following contextual considerations point decisively away from that interpretation. The Sentencing Act establishes uniform rules for sentencing across all courts that exercise criminal jurisdiction except the Children's Court of New South Wales15. Section 3A of the Sentencing Act states the purposes for which a court may impose a sentence on an offender, including "(a) to ensure that the offender is adequately punished for the offence". Part 2 of the Sentencing Act specifies the penalties that may be imposed by the relevant courts. Part 3 of the Sentencing Act, which is entitled "Sentencing procedures generally", applies to the imposition of [2017] NSWCCA 97 at [19], [67], [92]. [2017] NSWCCA 97 at [19]. 15 See Crimes (Sentencing Procedure) Act 1999 (NSW), s 3(1) definition of "court". Edelman Gleeson all penalties imposed by a relevant court, whether under the Sentencing Act or otherwise16. At the relevant time, Parts 4 to 8C of the Sentencing Act principally concerned sentencing procedures, by reference to the kinds of sentence that may be imposed: imprisonment, intensive correction orders, home detention orders, community service orders, good behaviour bonds, non-association and place restriction orders, and intervention program orders. The uniform approach to sentencing across courts is reinforced by Div 1 of Pt 3 of the Sentencing Act, which, at the relevant time, comprised ss 21 to 25, and sets out general matters about sentencing procedures generally. Section 21 confers a general power to reduce penalties. Of relevance to this appeal, s 21(2) provides: "If by any provision of an Act or statutory rule an offender is made liable to imprisonment for a specified term, a court may nevertheless impose a sentence of imprisonment for a lesser term." Like s 22, s 21(2) confers upon a relevant court the power to impose a sentence without reference to the possible effect of a jurisdictional limit. Section 21A(1) specifies the matters that a court is to take into account "[i]n determining the appropriate sentence for an offence". The matters comprise aggravating factors referred to in s 21A(2) that are relevant and known to the court; mitigating factors referred to in s 21A(3) that are relevant and known to the court; and any other objective or subjective factor that affects the relative seriousness of the offence. Section 21A(1) also states that the matters referred to in s 21A(1) are in addition to any other matters that are required or permitted to be taken into account by the court under any Act or rule of law. Contrary to the appellant's submission, a jurisdictional limit is not a matter required to be taken into account "[i]n determining the appropriate sentence for an offence" in accordance with s 21A. A jurisdictional limit relates to the sentencing court, not to the task of identifying and synthesising the relevant factors that are weighed to determine the appropriate sentence. To the contrary, the maximum penalty for an offence is a matter that is almost always required to be taken into 16 Crimes (Sentencing Procedure) Act 1999 (NSW), s 4(3). Edelman Gleeson account to determine the appropriate sentence, including where the maximum penalty exceeds a relevant jurisdictional limit17. Most importantly, the mitigating factors in s 21A(3) included, at the relevant time, "(k) a plea of guilty by the offender (as provided by section 22)". Thus, the court was required to apply s 22 for the purpose of determining the appropriate sentence for an offence in accordance with s 21A(1), that is, without regard to the jurisdictional limit. Once the court applied s 22 for this purpose, s 22 had no further work to do. The appellant did not attempt to reconcile his interpretation of s 22 with the process for determining the appropriate sentence for an offence in s 21A. Similarly, s 21A(3)(l) and (m) require the court to have regard to "the degree of pre-trial disclosure by the defence (as provided by section 22A)" and "assistance by the offender to law enforcement authorities (as provided by section 23)" as mitigating factors in determining the appropriate sentence for an offence. Like ss 21(2) and 22, ss 22A(1) and 23(1) also confer upon a relevant court the power to impose "a lesser penalty than it would otherwise impose" without reference to the possible effect of a jurisdictional limit. Application of s 22 prior to, and without regard to, any jurisdictional limit is not inconsistent with the purpose of s 22, which encourages guilty pleas without mandating discounts and while ensuring that sentences are not "unreasonably disproportionate to the nature and circumstances of the offence". In the case of an offender such as the appellant, the jurisdictional limit itself provided an incentive to a guilty plea because, although the prosecutor was entitled to elect to have the offence dealt with on indictment, in the case of a plea of guilty this election could not be made after the presentation of the facts relied upon by the prosecution to prove the offence18. In many cases, such an offender could have expected to receive 17 R v Doan (2000) 50 NSWLR 115 at 123 [35]; Markarian v The Queen (2005) 228 CLR 357 at 372 [30]-[31]; R v Duncan (2007) 172 A Crim R 111 at 117 [20] per Nettle JA, Chernov and Vincent JJA agreeing. 18 Criminal Procedure Act 1986 (NSW), ss 260(2), 263(3)(b). Edelman Gleeson a sentence considerably higher than the jurisdictional limit, even after a plea, if their matter had not been dealt with summarily19. An interpretation of s 22 that does not have regard to any jurisdictional limit is consistent with the more general rule that a court exercising summary jurisdiction has regard to the maximum penalty for the offence as the starting point for sentencing, and not a lower jurisdictional limit. This rule was stated by the Court of Criminal Appeal in R v Doan as follows20: "[W]here the maximum applicable penalty is lower because the charge has been prosecuted within the limited summary jurisdiction of the Local Court, that court should impose a penalty reflecting the objective seriousness of the offence, tempered if appropriate by subjective circumstances, taking care only not to exceed the maximum jurisdictional limit. The implication of the argument of the appellant that, in lieu of prescribed maximum penalties exceeding two years imprisonment, a maximum of two years imprisonment for all offences triable summarily in the Local Court has been substituted, must be rejected. As must also be rejected, the corollary that a sentence of two years imprisonment should be reserved for a 'worst case'." The appellant did not dispute the correctness of R v Doan or its application to this appeal, but submitted that R v Doan does not preclude the separate application of s 22 at the final stage of the sentencing process, having regard to the jurisdictional limit, and following the earlier determination of an appropriate penalty with due regard to the maximum penalty for the offence and all other relevant factors. On the appellant's construction, where there is a relevant jurisdictional limit, the court would be required to determine the appropriate sentence in two stages, contrary to s 21A. The first stage would identify the appropriate penalty putting aside the utilitarian value of the guilty plea (and, presumably, any utilitarian considerations arising from pre-trial disclosure or assistance to law enforcement authorities falling within s 22A or s 23); the second stage would consider whether to reduce the sentence below the jurisdictional limit 19 See, eg, the cases cited in Park v The Queen (2020) 282 A Crim R 551 at 589-590 (2000) 50 NSWLR 115 at 123 [35]. See also Re Attorney-General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 (NSW) (No 2 of 2002) (2002) 137 A Crim R 196 at 203-204 [27]; R v El Masri [2005] NSWCCA 167 at [30]; Kerr v The Queen [2008] NSWCCA 133 at [31]; Lapa v The Queen (2008) 192 A Crim R 305 at 308-309 [16]. Edelman Gleeson having regard to the matters set out in s 22, including the statutory requirement in s 22(1A) that a lesser sentence must not be unreasonably disproportionate to the nature and circumstances of the offence and the first stage of the assessment. In addition, the appellant's interpretation requires different application of the guideline judgment in R v Thomson, depending upon the sentencing court's jurisdiction. To illustrate, in the offence the subject of this appeal, the discount was assessed at eight months, being 25% of two years and eight months, and the jurisdictional limit was said to result in an indicative sentence of two years. If the discount was similarly assessed by reference to the jurisdictional limit, a 25% discount would be six months, being 25% of two years, and would produce a sentence of 18 months. Not only would the sentencing court have reached a different indicative sentence on the same facts, it would have been required to satisfy itself that the application of that discount would not be "unreasonably disproportionate to the nature and circumstances of the offence". Finally, once the different purposes of ss 22 and 53A are recognised, and s 53A(2)(b) is read as a whole and in context, s 53A provides only limited support for the appellant's interpretation of s 22. Section 53A is contained in Div 1 of Pt 4 of the Sentencing Act, which deals with setting terms of imprisonment. Section 53A is relevantly subject to s 49(2)(a), which provides that the term of an aggregate sentence of imprisonment must not be more than the sum of "the maximum periods of imprisonment that could have been imposed" if separate sentences of imprisonment "had been imposed" in respect of each offence to which the sentence relates. Further, the requirement in s 53A(2)(b) is to indicate a sentence "after taking into account such matters as are relevant under Part 3" and "had separate sentences been imposed instead of an aggregate sentence". Matters relevant under Pt 3 include s 33, concerning outstanding charges that may be taken into account. By s 33(3), if the court takes a further offence into account, the penalty imposed for the principal offence must not exceed "the maximum penalty that the court could have imposed for the principal offence had the further offence not been taken into account". Section 22 concerns the determination of the appropriate sentence for an individual offence. Section 53A applies once the sentencing judge has determined appropriate sentences for each of multiple offences, and the section permits a single sentence to be imposed for multiple offences, "to simplify the process when setting sentences for multiple offences, such that the overall impact of the sentence is clear, as is the court's assessment of the offender's criminality with respect to Edelman Gleeson each offence"21. Among other things, the indicative sentences required by s 53A(2)(b) assist in explaining how the aggregate sentence was arrived at22. Conclusion The appeal must be dismissed. 21 New South Wales, Legislative Council, Parliamentary Debates (Hansard), 23 November 2010 at 27870. 22 R v Nykolyn [2012] NSWCCA 219 at [58]; PD v The Queen [2012] NSWCCA 242 at [43]; JM v The Queen (2014) 246 A Crim R 528 at 537-538 [40].
HIGH COURT OF AUSTRALIA AND APPELLANT MINISTER FOR IMMIGRATION AND CITIZENSHIP RESPONDENT Saeed v Minister for Immigration and Citizenship [2010] HCA 23 23 June 2010 ORDER Appeal allowed with costs. Set aside the order of the Full Court of the Federal Court of Australia made on 1 April 2009 and in its place order that: Appeal allowed with costs. Set aside Orders 2 and 3 of the orders of the Federal Magistrates Court of Australia made on 2 December 2008 and in their place order that: (iii) a writ of certiorari issue directed to the delegate of the respondent, quashing the decision dated 16 July 2008; a writ of prohibition issue directed to the respondent, prohibiting the delegate's decision dated 16 July 2008; from giving effect the respondent a writ of mandamus issue to the respondent requiring the respondent to consider and determine the applicant's application for a Skilled – Independent Visa (Subclass 175) according to law; and the respondent pay the applicant's costs. On appeal from the Federal Court of Australia Representation S B Lloyd SC with L J Karp for the appellant (instructed by Christopher Levingston & Associates) S J Gageler SC, Solicitor-General of the Commonwealth with L A Clegg for the respondent and the intervening on behalf of Commonwealth (instructed by Australian Government Solicitor) the Attorney-General of R J Meadows QC, Solicitor-General for the State of Western Australia with C L Conley intervening on behalf of the Attorney-General for the State of Western Australia (instructed by State Solicitor for Western Australia) M G Hinton QC, Solicitor-General for the State of South Australia with C Jacobi intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor for the State of South Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Saeed v Minister for Immigration and Citizenship Immigration – Visa – Visa applications made outside migration zone – Where applicant not afforded opportunity to comment upon information which supported inference that essential aspect of application was false or misleading – Where Minster's delegate not satisfied about necessary criterion for visa on basis of such information – Whether ss 51A(1) or 57(3) of Migration Act 1958 (Cth) ("Act") excluded requirements of natural justice hearing rule in relation to visa applications made outside migration zone – Whether provision of information to visa applicants outside migration zone was a "matter" which Pt 2 Div 3 subdiv AB of Act "deals with" – Whether requirements of natural justice a condition of statutory power to grant or refuse visa – Where statutory requirement of actual satisfaction as to facts – Whether obligation to take into account all factors which may affect determination – Whether state of non- satisfaction about criterion can be reached if Minister fails to consider whether any answer to information was put forward by applicant. Statutory interpretation – Where amendments to Act respond to High Court decision – Relevance and permissible use of extrinsic material. Words and phrases – "natural justice hearing rule", "satisfied", "the matters it deals with". Migration Act 1958 (Cth), ss 51A(1), 56, 57, 65(1). FRENCH CJ, GUMMOW, HAYNE, CRENNAN AND KIEFEL JJ. Division 3 of Pt 2 the Migration Act 1958 (Cth) ("the Act") contains provisions with respect to the grant or refusal of visas for non-citizens. Subdivision AB of that Division is directed to the Minister's dealing with an application for a visa and information relating to it. At issue in this appeal is whether an amendment to subdiv AB, effected by the insertion of s 51A1, has the effect of excluding the requirements of the natural justice hearing rule and whether it may validly do so. In the circumstances of this case the rule would have required the Minister's delegate to afford the appellant an opportunity to comment upon information which had been provided to the delegate and which supported an inference that an essential aspect of the appellant's case for a visa was false. The terms of s 51A are not directed to all requirements of natural justice. They are expressed to apply to the requirements of the natural justice hearing rule. The concern of that rule is that procedural fairness be applied in the process of decision-making in circumstances where a person's rights or interests may be affected by the decision. Applied to a case such as this, the rule requires that an opportunity be given to a person to deal with adverse information that is credible, relevant and significant to the decision to be made2. It reflects a fundamental principle of natural justice. Section 51A provides: "Exhaustive statement of natural justice hearing rule This Subdivision is taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with. Sections 494A to 494D, in so far as they relate to this Subdivision, are taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters they deal with." The focus of this appeal is upon s 51A(1). 1 Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). 2 Kioa v West (1985) 159 CLR 550 at 629 per Brennan J; see also 569 per Gibbs CJ, 582 per Mason J, 602 per Wilson J, 633 per Deane J; [1985] HCA 81. Crennan Background and curial history The appellant is a citizen of Pakistan. In November 2007 she applied for a Skilled – Independent Visa (Subclass 175). A visa of this kind can only be granted if the visa applicant is outside Australia when the visa is granted3. A criterion for the visa required the appellant to have been employed in a skilled occupation for at least 12 months in the period of 24 months ending immediately before the day on which her application was made4. The appellant provided documents to demonstrate that she had been employed as a cook from March 2006 until November 2007 at a restaurant in Rawalpindi. Australian immigration officers in Pakistan investigated the appellant's claims and discovered that no employee records were kept on the premises of the restaurant. They were advised that no woman had ever worked in the kitchen. On the basis of this information the Minister's delegate advised the appellant that she considered the evidence the appellant had supplied as to her employment to have been false or misleading. As the delegate then considered she could not be satisfied about a criterion necessary to grant the visa, the appellant's application was refused. The delegate's decision was not subject to review by the Migration Review Tribunal. Such review is limited to the case of visas which can be granted whilst an applicant is in the Australian migration zone5. The appellant sought a declaration and an order for mandamus against the Minister under s 39B of the Judiciary Act 1903 (Cth). The ground upon which she relied was that the delegate failed to afford her what would be required under the natural justice hearing rule. 3 Migration Act 1958 (Cth), s 40(1) and (2)(a); Migration Regulations 1994 (Cth), reg 2.04(1)(a) and Sched 2, item 175.412. 4 Migration Regulations, Sched 2, item 175.211(2)(a). 5 Migration Act, s 338(1) and (2). Crennan In the Federal Magistrates Court6 and on the appeal to a Full Court of the Federal Court7 the decision in Minister for Immigration and Multicultural and Indigenous Affairs v Lat8 ("Lay Lat") was followed. The appellant's application and her appeal were dismissed with costs. In Lay Lat a Full Court of the Federal Court held that it was intended, by s 51A(1), to exclude the common law natural justice hearing rule and that subdiv AB was to provide a comprehensive The appellant's principal argument on the appeal to this Court had regard to the construction of subdiv AB of the Act and the operation of s 51A(1) with respect to provisions of that subdivision. If that argument is accepted it will be unnecessary to consider the alternative argument, that s 51A is invalid. This argument was put on two bases. It was put that some fundamental principles are impliedly protected by s 75(v) of the Constitution and a law cannot validly prevent recourse to that provision. Further, s 51A may be seen to direct courts and interfere with their application of principles of statutory construction and thereby undermine their ability to exercise the judicial power granted by Ch III of the Constitution. The power to grant or refuse a visa and subdivision AB The power to grant a visa to a non-citizen to travel to, enter and remain in Australia is given to the Minister by s 29 of the Act. Section 47(1) requires the Minister to consider a valid application for a visa. That obligation continues until the visa is either granted or refused10. Section 65(1) provides that after considering a valid application for a visa, the Minister, if satisfied that the criteria for the visa have been satisfied, is to grant the visa; and if not so satisfied, is to refuse to grant the visa. 6 Saeed v Minister for Immigration and Citizenship [2008] FMCA 1619 per 7 Saeed v Minister for Immigration and Citizenship (2009) 176 FCR 53 per Spender, (2006) 151 FCR 214. 9 Minister for Immigration and Multicultural and Indigenous Affairs v Lat (2006) 151 FCR 214 at 225-226 [66]. 10 Migration Act, s 47(2)(b). Crennan Subdivision AB concerns how an application for a visa is dealt with after it is lodged and before a decision is made. Section 52 provides for the way in which a visa applicant may communicate with the Minister after lodging an application. Sections 54 and 55 require the Minister to have regard to information forming part of the application, or which is provided subsequently, but prior to a decision being made. Sections 56 and 57, which assume importance on the appeal and are set out below, provide, respectively, that further information may be sought from a visa applicant and that certain information received by the Minister must be provided to a visa applicant for comment. Section 58 makes provision for how the additional information, invited under s 56, or the comment on relevant information, invited under s 57, may be given. Section 63 provides for the time when a decision may be made, having regard to whether invitations for information or comment are outstanding. A condition on the power to refuse In Annetts v McCann11 it was said that it could now be taken as settled that when a statute confers power to destroy or prejudice a person's rights or interests, principles of natural justice regulate the exercise of that power12. Brennan J in Kioa v West13 explained that all statutes are construed against a background of common law notions of justice and fairness. His Honour said: "[W]hen the statute does not expressly require that the principles of natural justice be observed, the court construes the statute on the footing that 'the justice of the common law will supply the omission of the legislature'. The true intention of the legislation is thus ascertained." The implication of the principles of natural justice in a statute is therefore arrived at by a process of construction. It proceeds upon the assumption that the legislature, being aware of the common law principles, would have intended that 11 (1990) 170 CLR 596; [1990] HCA 57. 12 Annetts v McCann (1990) 170 CLR 596 at 598 per Mason CJ, Deane and 13 (1985) 159 CLR 550 at 609 (citation omitted). Crennan they apply to the exercise of a power of the kind referred to in Annetts v Observance of the principles of natural justice is a condition attached to such a statutory power and governs its exercise, as Brennan J further explained in Kioa v West15. A failure to fulfil that condition means that the exercise of the power is inefficacious16. A decision arrived at without fulfilling the condition cannot be said to be authorised by the statute and for that reason is invalid17. In Annetts v McCann Mason CJ, Deane and McHugh JJ said that the principles of natural justice could be excluded only by "plain words of necessary intendment"18. And in The Commissioner of Police v Tanos19 Dixon CJ and Webb J said that an intention to exclude was not to be assumed or spelled out from "indirect references, uncertain inferences or equivocal considerations." Their Honours in Annetts v McCann added that such an intention was not to be inferred from the mere presence in the statute of rights consistent with some natural justice principles. The presumption that it is highly improbable that Parliament would overthrow fundamental principles or depart from the general system of law, without expressing its intention with irresistible clearness20, derives from the principle of legality which, as Gleeson CJ observed in Electrolux Home Products 14 Salemi v MacKellar [No 2] (1977) 137 CLR 396 at 401 per Barwick CJ, 451 per Jacobs J; [1977] HCA 26. 15 (1985) 159 CLR 550 at 609. 16 FAI Insurances Ltd v Winneke (1982) 151 CLR 342 at 409 per Brennan J; [1982] HCA 26. 17 Salemi v MacKellar [No 2] (1977) 137 CLR 396 at 401 per Barwick CJ. 18 (1990) 170 CLR 596 at 598. 19 (1958) 98 CLR 383 at 396; [1958] HCA 6. 20 Potter v Minahan (1908) 7 CLR 277 at 304 per O'Connor J; [1908] HCA 63. Crennan Pty Ltd v Australian Workers' Union21, "governs the relations between Parliament, the executive and the courts."22 His Honour said23: "The presumption is not merely a common sense guide to what a Parliament in a liberal democracy is likely to have intended; it is a working hypothesis, the existence of which is known both to Parliament and the courts, upon which statutory language will be interpreted. The hypothesis is an aspect of the rule of law." Sections 56 and 57 Sections 56 and 57 are the only provisions in subdiv AB containing powers by which a visa applicant may be given an opportunity, after lodging their application, to provide further information (s 56) or comment on information provided to the Minister (s 57). Section 57 requires certain procedures to be followed to that end. Those sections provide: "56 Further information may be sought In considering an application for a visa, the Minister may, if he or she wants to, get any information that he or she considers relevant but, if the Minister gets such information, the Minister must have regard to that information in making the decision whether to grant or refuse the visa. (2) Without limiting subsection (1), the Minister may invite, orally or in writing, the applicant for a visa to give additional information in a specified way. 21 (2004) 221 CLR 309 at 329 [21]; [2004] HCA 40. 22 Electrolux Home Products Pty Ltd v Australian Workers' Union (2004) 221 CLR 309 at 329 [21], referring to R v Secretary of State for the Home Department; Ex parte Pierson [1998] AC 539 at 587, 589. 23 Electrolux Home Products Pty Ltd v Australian Workers' Union (2004) 221 CLR Crennan Certain information must be given to applicant In this section, relevant information means information (other than non-disclosable information) that the Minister considers: (a) would be the reason, or a part of the reason, for refusing to grant a visa; and is specifically about the applicant or another person and is not just about a class of persons of which the applicant or other person is a member; and (c) was not given by the applicant for the purpose of the application. Subject to subsection (3), the Minister must: give particulars of the relevant information to the applicant in the way that the Minister considers appropriate in the circumstances; and ensure, as far as is reasonably practicable, that the applicant understands why it is relevant to consideration of the application; and invite the applicant to comment on it. This section does not apply in relation to an application for a visa unless: the visa can be granted when the applicant is in the migration zone; and this Act provides, under Part 5 or 7, for an application for review of a decision to refuse to grant the visa." Some observations are necessary at this point with respect to these provisions. Section 57(1) and (2) invite comparison with what might ordinarily be required by the hearing rule. It is necessary to bear in mind, in that regard, that what is required to provide procedural fairness according to the rule will vary. Crennan Natural justice is flexible and adaptable to the circumstances of the particular case24. Brennan J in Kioa v West25 said that, in the ordinary case, an opportunity should be given to a person affected by a decision to deal with any adverse information that is "credible, relevant and significant". That approach has more recently been confirmed in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs26. Mason J in Kioa v West27 went further. In his Honour's view the common law would require the decision-maker to bring the critical issue or factor on which the decision was likely to turn to the attention of the person. Brennan J's approach would not deny that this may be necessary in a particular case. The requirements of s 57(1)(a) and (2)(b) are similar to those referred to by Mason J. When the Minister considers that certain information would be the reason, or part of the reason, for refusing to grant a visa, the Minister is to provide particulars of it in order that the visa applicant understands its relevance. The requirement in s 57(2)(b), that the Minister ensure, as far as reasonably practicable, that the visa applicant understands why certain information is relevant, may go further. It would require that the importance of the information and its potential impact upon the applicant's case for a visa be identified and the information be communicated in a way which promotes that understanding as far as is possible. It would also require that consideration be given to the means by which particulars of the information should be provided, as most suitable to that purpose. Section 58 lists the alternatives of writing, telephone or an interview. It is not difficult to envisage that in some cases an interview may be necessary. 24 Kioa v West (1985) 159 CLR 550 at 612 per Brennan J. 25 (1985) 159 CLR 550 at 629. 26 (2006) 228 CLR 152 at 162 [32] per Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ; [2006] HCA 63, referring to Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 590-591 per Northrop, Miles and French JJ. 27 (1985) 159 CLR 550 at 587; and see Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 311 per McHugh J; [1995] HCA 20; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 27 [81] per McHugh and Gummow JJ, 49 [150] per Callinan J; [2003] HCA 6. Crennan Not all information adverse to a visa applicant, and which may be influential to a decision to refuse to grant a visa, qualifies as "relevant information", particulars of which must be provided by the Minister. Section 57(1)(b) limits the information to that which is specific to the visa applicant or another person, rather than a class of persons. More general information, such as country information, is unlikely to fall within this description. It is a matter of some significance to the application of s 51A(1) to s 57, that s 57 does not apply to all visa applicants. It requires only that "relevant information" be given to visa applicants who are in the migration zone28. This follows from sub-s (3)(a). Sub-section (3)(b) further provides that the requirements of sub-s (2) do not apply to a visa which does not carry with it a right of review. Neither condition for the application of s 57 was present with respect to the visa for which the appellant applied. It remains to mention the procedures provided by s 56. It may be observed that an invitation under s 56(2) might allow for a response to adverse information by the exercise of the power to obtain additional information. The power given by s 56 is not expressed in terms which would oblige its exercise by the Minister in order that an opportunity for comment could be provided to a visa applicant. Nevertheless, as Gaudron J observed in Re Minister for Immigration and Multicultural Affairs; Ex parte Miah29, where the Minister has regard to information other than that provided by an applicant, a question may arise whether procedural fairness requires that the powers in s 56(2) must be exercised to permit an applicant to put submissions or provide further information. The decision in Re Minister for Immigration and Multicultural Affairs; Ex parte Miah The provisions of subdiv AB, prior to the insertion of s 51A, were considered in Ex parte Miah. The application for a protection visa was made by the applicant after he had entered Australia30. The fact the application was made 28 In the balance of these reasons they will be referred to as "onshore visa applicants" and persons such as the appellant as "offshore visa applicants". 29 (2001) 206 CLR 57 at 86 [97]; [2001] HCA 22. 30 (2001) 206 CLR 57 at 60 [1], 79 [71], 89 [110]. Crennan onshore rather than, as in the present case, offshore, is a distinction to which further reference will be made in these reasons. Section 57(2) did not apply in Ex parte Miah as the information in question was not "relevant information" within the meaning of sub-s (1). The issue was whether natural justice nonetheless operated to require the provision of the information. It was argued for the Minister that subdiv AB was a code, as its heading ("Code of procedure for dealing fairly, efficiently and quickly with visa applications") suggested. It therefore excluded natural justice principles. The argument was not accepted by a majority of the Court31. McHugh J observed that the use of the word "fairly" in the heading made it difficult to extrapolate a manifestly clear intention to exclude natural justice principles32. Gaudron J considered that the heading imparted notions of procedural fairness33. Moreover, as her Honour pointed out, the correct question is not whether subdiv AB constitutes a code; it is whether, on its proper construction, it relevantly (and validly) limits or extinguishes the obligation to accord procedural fairness34. For it to do so requires a clear expression of intention. No member of the majority35 found such an expression present in the subdivision. Section 51A and its operation Section 51A appeared as item 1 to the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). That Act also introduced virtually identical sections to s 51A in other parts of the Act, including s 357A in Pt 5 and s 422B in Pt 7, which concern the conduct of reviews by the Migration Review 31 Gaudron, McHugh and Kirby JJ. 32 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 95 [131]. 33 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 85 [95]-[96]. 34 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 83-84 [90], referring to Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 101 [41] per Gaudron and Gummow JJ; [2000] HCA 57. 35 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 85 [95] per Gaudron J, 94 [128] per McHugh J and 113 [181] per Crennan Tribunal and the Refugee Review Tribunal respectively. The insertion of s 51A was plainly a response to the decision in Ex parte Miah. The language of the section and its analogues, and in particular the phrase "in relation to the matters it deals with" in sub-s (1), has been considered in judgments of single judges and Full Courts of the Federal Court. The phrase has been described as difficult to construe36 and apply37. In VXDC v Minister for Immigration and Multicultural and Indigenous Affairs38 and in Lay Lat39 it was described as ambiguous or obscure. The difficulty in the meaning of the phrase "in relation to the matters it deals with" was resolved in VXDC and then subsequently in Lay Lat, by resort to extrinsic materials. In Lay Lat the Full Court considered that the Explanatory Memorandum to the 2002 amending legislation and the second reading speech of the Minister made it plain that the terms of sections such as s 51A(1) were intended to overcome the effect of the decision in Ex parte Miah40. The Full "We agree with the observation … in VXDC that the drafters of the Explanatory Statement and the Minister could hardly have made the intention of the 2002 amendments any clearer." 36 Moradian v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 142 FCR 170 at 178 [28]. 37 WAID v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 220 at [57]. 38 (2005) 146 FCR 562 at 568 [22]. 39 (2006) 151 FCR 214 at 225 [64]. 40 Minister for Immigration and Multicultural and Indigenous Affairs v Lat (2006) 151 FCR 214 at 225 [64], [66]. 41 Minister for Immigration and Multicultural and Indigenous Affairs v Lat (2006) 151 FCR 214 at 225 [65]. Crennan The Full Court in this case held Lay Lat to be correct in its approach42. Neither Full Court considered competing views about the operation of s 51A(1) or its analogues. They did not determine what were "the matters" to which it was intended to refer. In Moradian v Minister for Immigration and Multicultural and Indigenous Affairs Gray J observed that, even if regard were to be had to extrinsic materials, they did not resolve the questions to which the section gave rise43. In the Explanatory Memorandum it was said that it had been the original intention of subdiv AB to provide a "code of procedure" and to exhaustively replace common law natural justice requirements, other than the rule against bias44. It was observed that the majority in Ex parte Miah considered that the exclusion of common law natural justice requirements required a clear legislative intention and that no such clear intention was present in the Act45. The following statement was then made46: "The purpose of this amendment, and the amendments in items 2 to 6, is to provide a clear legislative statement that certain 'codes of procedure' in the Act are an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters they deal with." In his second reading speech the Minister, after discussing the same background, said47: 42 Saeed v Minister for Immigration and Citizenship (2009) 176 FCR 53 at 55 [1], 65 43 (2004) 142 FCR 170 at 180 [35]. 44 Australia, House of Representatives, Migration Legislation Amendment (Procedural Fairness) Bill 2002, Explanatory Memorandum at 5 [6]. 45 Australia, House of Representatives, Migration Legislation Amendment (Procedural Fairness) Bill 2002, Explanatory Memorandum at 2 [3]. 46 Australia, House of Representatives, Migration Legislation Amendment (Procedural Fairness) Bill 2002, Explanatory Memorandum at 5 [10]. 47 Australia, House of Representatives, Parliamentary Debates, (Hansard), 13 March Crennan "Therefore, the purpose of this [B]ill is to make it expressly clear that particular codes the the Migration Act do exhaustively state requirements of the natural justice or procedural fairness hearing rule. This will have the effect that common law requirements relating to the natural justice or procedural fairness hearing rule are effectively excluded, as was originally intended." And48: "In conclusion, the these amendments are necessary [P]arliament's original intention that the Migration Act should contain codes of procedure that allow fair, efficient and legally certain decision making processes that do replace the common law requirement of the natural justice hearing rule." to restore As Gummow J observed in Wik Peoples v Queensland, it is necessary to keep in mind that when it is said the legislative "intention" is to be ascertained, "what is involved is the 'intention manifested' by the legislation."49 Statements as to legislative intention made in explanatory memoranda or by Ministers, however clear or emphatic, cannot overcome the need to carefully consider the words of the statute to ascertain its meaning. In Re Bolton; Ex Parte Beane50 the question was whether a statutory provision concerned with "visiting forces" applied to deserters from the armed forces of the United States. Mason CJ, Wilson and Dawson JJ said51: "[T]he second reading speech of the Minister … quite unambiguously asserts that Pt III relates to deserters and absentees whether or not they are from a visiting force. But this of itself, while deserving serious consideration, cannot be determinative; it is available as an aid to 48 Australia, House of Representatives, Parliamentary Debates, (Hansard), 13 March 49 (1996) 187 CLR 1 at 168-169 (emphasis added) (footnote omitted); [1996] HCA 50 (1987) 162 CLR 514; [1987] HCA 12. 51 Re Bolton; Ex Parte Beane (1987) 162 CLR 514 at 518. Crennan interpretation. The words of a Minister must not be substituted for the text of the law. Particularly is this so when the intention stated by the Minister but unexpressed in the law is restrictive of the liberty of the individual. It is always possible that through oversight or inadvertence the clear intention of the Parliament fails to be translated into the text of the law. However unfortunate it may be when that happens, the task of the Court remains clear. The function of the Court is to give effect to the will of Parliament as expressed in the law."52 Regard was had by the Full Court in this case to what was said in Re Bolton; Ex Parte Beane. Nevertheless, it is apparent that the Court did not consider the actual terms of s 51A and its application to the provisions of the As was pointed out in Catlow v Accident Compensation subdivision. Commission53 it is erroneous to look at extrinsic materials before exhausting the application of the ordinary rules of statutory construction. It may be accepted that the context for the enactment of s 51A was provided by the decision in Ex parte Miah and that s 51A was an attempt to address the shortcomings identified in that decision. Resort to the extrinsic materials may be warranted to ascertain that context and that objective, although it is hardly necessary to do so. But that objective cannot be equated with the statutory intention as revealed by the terms of the subdivision. The question whether s 51A in its operation has the effect contended for, of excluding the natural justice hearing rule, is to be answered by having regard, in the first place, to the text of s 51A and the provisions with which it interacts. The questions which, in turn, are raised about the operation of s 51A, it will be seen, are not answered by anything said in the extrinsic materials. This is explicable. The decision in Ex parte Miah, which s 51A addressed, was not concerned with the application of s 57 of the subdivision to offshore visa applicants. 52 See also Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397 at 405 per Kitto J; [1967] HCA 31; Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 459 per McHugh and Gummow JJ; [1995] HCA 24; Purvis v New South Wales (2003) 217 CLR 92 at 122-123 [92] per McHugh and Kirby JJ; [2003] HCA 62; and Director of Public Prosecutions (Vic) v Le (2007) 232 CLR 562 at 573 [29] per Gummow and Hayne JJ; [2007] HCA 52. 53 (1989) 167 CLR 543 at 550 per Brennan and Gaudron JJ; [1989] HCA 43. Crennan The declaration in s 51A(1), that the subdivision is to be taken as an exhaustive statement of the requirements of the natural justice hearing rule, is qualified by the words "in relation to the matters it deals with". The importance of the question about what "matters" are to be seen as dealt with in the subdivision was identified by French J in WAID v Minister for Immigration and Multicultural and Indigenous Affairs54, with respect to s 422B of the Act. In NAQF v Minister for Immigration and Multicultural and Indigenous Affairs55 Lindgren J considered that two approaches to the question were open with respect to s 357A(1). If the general question was posed, "What is the subject matter of Div 5 of Pt 5?", the answer would likely be, "The conduct of reviews by the MRT". Translated to subdiv AB of Div 3 of Pt 2, the answer to the question would be, "The procedure for dealing with visa applications". This approach, which looks to the totality of the matters dealt with by the subdivision, was submitted by the Minister to be correct. The Minister's argument laid stress on the word "it" in s 51A(1) as referable to the subdivision. Consistently, where s 51A(2) refers to the matters "they" deal with, it refers to the group of ss 494A to 494D, which deal with the giving of notice. So much may be accepted. However, a consideration of all the words "the matters it deals with" directs attention to provisions within the subdivision or the group of sections which are operative. The alternative inquiry considered by Lindgren J in NAQF v Minister for Immigration and Multicultural and Indigenous Affairs was, "What are the matters Div 5 of Pt 5 deals with?" The answer to that question would require a search of the sections within the Division for a provision "dealing with" a relevant "matter"56. And, as his Honour observed, the plural form of "matters" suggests that the inquiry might be directed to a number of such provisions. 54 [2003] FCA 220 at [57]-[58]. 55 (2003) 130 FCR 456 at 468 [58]. 56 NAQF v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 130 FCR 456 at 468 [58] and 475 [83]. Crennan It was not necessary for Lindgren J to reach a conclusion as to which was the correct approach, but his Honour said that he favoured the latter57, as did French J, implicitly, in WAID v Minister for Immigration and Multicultural and Indigenous Affairs58. Such an approach is plainly correct. The presumption is that words are used in a statute for a reason; they should be given their meaning and effect59. Necessarily, provisions which "deal with" "matters", for the purposes of s 51A, will contain some procedural requirements which go some way towards satisfying the fundamental requirements of the natural justice hearing rule. Some such procedural requirements are necessary if s 51A is to operate and the procedures provided for are to be taken as exhaustive of the rule. Section 57 contains such procedures. The power given in s 56, to invite an applicant to give further information, may be used to further procedural fairness but it does not mandate procedures which may be taken as a substitute for the requirements of the rule. Section 51A is not addressed to s 56. A point made by Lindgren J in NAQF v Minister for Immigration and Multicultural and Indigenous Affairs is that the "matters" "dealt with" in the subdivision cannot be simply equated with the procedural requirements of its operative provisions60, for s 51A(1) would then be largely otiose. Thus, if the matter dealt with by s 57 was the giving of information fulfilling the description of "relevant information" to a visa applicant for comment, s 51A would operate so that it was exhaustive of the requirements of the natural justice hearing rule so far as concerned the giving of information only of that kind. A limited purpose would then be achieved by s 51A(1). The rule would continue to apply to the 57 NAQF v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 130 FCR 456 at 475 [83]. 58 [2003] FCA 220 at [58]. 59 The Commonwealth v Baume (1905) 2 CLR 405 at 414 per Griffith CJ; [1905] HCA 11; Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 12-13 per Mason CJ; [1992] HCA 64; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 382 [71] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28. 60 NAQF v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 130 FCR 456 at 469 [59]. Crennan provision of other information. The search, as his Honour said, is for a larger In order to give s 51A operation it is necessary to refer to the subject of the "matter" with which s 57 deals as the provision of information, more generally relevant and adverse, for comment. But there is a qualification to the description of the "matter", which arises from the persons to whom the information is to be provided. The terms of the section limit such persons to onshore visa applicants. The "matter" with which s 57 deals, is the provision of such information to onshore visa applicants. The provision of information to offshore visa applicants, such as the appellant, is not a "matter" dealt with by the sub-section. It follows that the application of the hearing rule in dealings with the appellant's application is not excluded by subdiv AB. The Notice of Contention On the hearing of the appeal the Minister was granted leave to file a Notice of Contention to the effect that s 57(3) dispenses both with the statutory duty to provide information and any common law duty to provide natural justice. It was submitted for the Minister that it could not have been intended to provide that onshore visa applicants have only the procedural rights provided by s 57(1) and (2), whilst offshore visa applicants were to be afforded all that the natural justice hearing rule would require. This was the view expressed in Lay Lat62. The question whether the natural justice hearing rule is not to apply to dealings with offshore visa applicants is not answered by pointing to the particular procedures provided by s 57(2) with respect to onshore visa applicants and proceeding from the premise that what was there provided was the most that any visa applicant could expect by way of procedural fairness. All that may fairly be deduced from the terms of s 57 is that it was considered to be appropriate to onshore, but not offshore, visa applicants. The reason for the differential operation of s 57, to onshore and offshore visa applicants, is not mentioned in the Act. The Minister submitted that that 61 NAQF v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 130 FCR 456 at 469 [60]. 62 Minister for Immigration and Multicultural Affairs v Lat (2006) 151 FCR 214 at Crennan operation must be understood in the wider scheme of the Act which may be taken to reflect policy choices about matters such as administrative convenience. Onshore visa applicants are entitled to reasons for refusal; offshore visa applicants are not63. There is no strict limitation upon offshore visa applicants reapplying, as there is with respect to onshore visa applicants64. The feature of onshore visa applications which explains these provisions is the right of review of the Minister's decision which is extended to them, but not to offshore visa applications. Onshore visa applicants need reasons for refusal for that purpose. The fact that their ability to reapply is limited may be explained because they have been provided with a right of review of the decision on their initial application. Further, it may be observed that the Act does not deny offshore visa applicants reasons; it simply does not oblige the giving of them in every case. In this case reasons were given. The Minister's submissions acknowledged that the content of natural justice might vary with respect to individual cases of offshore visa applicants. It was submitted that factors such as administrative convenience and difficulties in communication would be weighed and that in some cases nothing, or practically nothing, might be seen as required. But the proposition that natural justice may, in some cases, require less does not lead to the conclusion that none is intended to be provided and that no consideration is to be given to what could and should be provided in an individual case. The factors pointed to by the Minister may well explain why the procedures in s 57(2) were not considered to be appropriate with respect to offshore visa applicants. The obligation of the Minister, to "ensure" that a visa applicant understands the relevance of the adverse information, highlights the potential for practical difficulties. Section 58 recognises that it may be necessary to conduct an interview to fulfil this obligation. This is unlikely to be practicable with respect to offshore visa applicants. It may therefore have been considered necessary to exclude offshore visa applicants from the operation of s 57, leaving considerations of what natural justice required to be determined by reference to the circumstances of a given case. Nothing is said in subdiv AB about the exclusion of the hearing rule so far as concerns offshore visa applicants. Section 57(3) excludes only the procedural requirements of s 57(2). 63 Migration Act, s 66(2)(c) and (3). 64 Migration Act, s 48. Crennan Exercise of the power to refuse At the outset of the appellant's argument as to the validity of s 51A it was submitted that there may be limits to the extent to which procedural fairness might be excluded by a law of the Commonwealth. The focus of the submission was constitutional powers or protections. It may more directly raise questions as to the conditions necessary to the exercise of the relevant powers under the Act and the limits which those conditions may effect. The powers given by s 56(2) put the issue in context. As was observed earlier in these reasons65, questions about the exercise of that power in accordance with natural justice principles may well arise where relevant, adverse, information is received by the Minister. Although s 56(2) is cast in terms that the Minister "may" invite the giving of additional information, where information is received which is adverse to an applicant, perhaps critically so, the circumstances may be such as to call for the exercise of the power66. But if s 57 applies to offshore visa applicants, a question arises as to whether the power to request additional information is to be exercised by the Minister. The answer to this question may be provided by a consideration of the ultimate power to be exercised, to grant or refuse a visa, and of the conditions attaching to the exercise of that power. Section 65(1), excluding requirements not here relevant, provides that: "After considering a valid application for a visa, the Minister: if satisfied that: the other criteria for it prescribed by this Act or the regulations have been satisfied; 66 Macdougall v Paterson (1851) 11 CB 755 at 766 per Jervis CJ [138 ER 672 at 677]; Leach v The Queen (2007) 230 CLR 1 at 17-18 [38] per Gummow, Hayne, Heydon and Crennan JJ; [2007] HCA 3. Crennan is to grant the visa; or if not so satisfied, is to refuse to grant the visa." The Act thereby imposes a duty upon the Minister to have regard to the criteria necessary to the grant of a visa and an obligation to consider prior to coming to a decision67. Here the Minister was obliged to consider the appellant's employment history. The facts about which the Minister had to be satisfied, or not satisfied, was whether she had been employed in a skilled occupation for the requisite period prior to her application being made. It was said in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/200268 that the Act requires more than a bona fide attempt to be satisfied; it requires actual satisfaction. And in R v Connell; Ex parte The Hetton Bellbird Collieries Ltd69 Latham CJ said that where the exercise of statutory power is conditional upon the existence of a particular opinion, an inquiry for the Court may be whether the opinion has really been formed. The question which arises, by reference to s 65(1), is whether the Minister can reach a state of non-satisfaction about the criteria if the Minister puts out of consideration whether there was an answer to the information contradicting the employment history put forward by the appellant. An analogy may be drawn with material, or relevant, considerations. In Avon Downs Pty Ltd v Federal Commissioner of Taxation70 the Commissioner was required to be satisfied as to the state of voting power at the end of the year of income in question. Dixon J said that the Commissioner's decision was subject to review, inter alia, if he should affect his "excludes from consideration factor which some 67 Migration Act, s 65; and see Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/2002 (2003) 211 CLR 441 at 467-468 [75]; [2003] HCA 1. 68 (2003) 211 CLR 441 at 471 [85]. 69 (1944) 69 CLR 407 at 430, 432; [1944] HCA 42. 70 (1949) 78 CLR 353 at 360; [1949] HCA 26. Crennan determination"71. Where a decision-maker is bound to take a factor into account but does not, the requisite state of satisfaction is not reached72. If such consideration is necessary before the Minister can be satisfied, or not, there may be limits to the extent to which restrictions placed upon the exercise of the power to refuse a visa can operate consistent with it. The question therefore is whether the Act requires that consideration. It is not necessary to conclude that question, given the conclusion available as to the construction and operation of s 51A, nor is it desirable since the argument on the appeal did not proceed to that point. Conclusion on construction Assuming, for present purposes, that s 51A as it applies to s 57, is valid and effective to exclude the natural justice hearing rule, it is excluded only so far as concerns onshore visa applicants. This follows from the terms of s 57(3), which plainly exclude offshore visas from the operation of s 57. The position of offshore visas is not addressed in subdiv AB. The provision of particulars of information to them for comment is not a "matter" "dealt with" by s 57 or the subdivision. Section 51A(1) was addressed to provisions such as s 57(2). So much may be inferred from it being a response to the decision in Ex parte Miah and from the extrinsic materials. Nothing in those materials is addressed to the question of construction which arises and which concerns the identification of the matter dealt with. The statement in the Explanatory Memorandum did little more than repeat the words of s 51A(1), which themselves were expressed in general terms. 71 Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353 at 72 R v Connell; Ex parte The Hetton Bellbird Collieries Ltd (1944) 69 CLR 407 at 430; Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353 at 360 per Dixon J; Buck v Bavone (1976) 135 CLR 110 at 118-119 per Gibbs J; [1976] HCA 24; Foster v Minister for Customs and Justice (2000) 200 CLR 442 at 447 [7]-[8] per Gleeson CJ and McHugh J; [2000] HCA 38; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/2002 (2003) 211 CLR 441 at 471 [85]. Crennan In Coco v The Queen73 it was said, with respect to fundamental rights, that "[t]he courts should not impute to the legislature an intention to interfere with fundamental rights."74 The same may be said as to the displacement of fundamental principles of the common law. In Coco v The Queen Mason CJ, Brennan, Gaudron and McHugh JJ said75: "Such an intention must be clearly manifested by unmistakable and unambiguous language. General words will rarely be sufficient for that purpose if they do not specifically deal with the question because, in the context in which they appear, they will often be ambiguous on the aspect of interference with fundamental rights." It follows that the implication of the natural justice hearing rule with respect to offshore visa applicants was maintained. The Minister was obliged to provide the appellant with an opportunity to answer the adverse material. Orders The appeal should be allowed with costs. The orders of the Full Court of the Federal Court and of the Federal Magistrates Court should be set aside and the respondent should pay the appellant's costs of these proceedings. The decision of the delegate of the Minister dated 16 July 2008 should be quashed and a writ of mandamus issue requiring the Minister to consider and determine the appellant's application for a Skilled – Independent Visa (Subclass 175) according to law. 73 (1994) 179 CLR 427; [1994] HCA 15. 74 Coco v The Queen (1994) 179 CLR 427 at 437. 75 (1994) 179 CLR 427 at 437 (footnote omitted). HEYDON J. I agree with the orders proposed in the joint judgment, and adopt the account of the background, the description of the legislation and the abbreviations employed in it. On no few occasions when an injustice may result if an appellant's appeal fails, the present respondent chooses to consent to the appeal being allowed. This appeal concerns a scheme created by the Parliament under which non-citizens may make applications for visas while offshore. The Parliament did not have to create this scheme. The parties did not point to any treaty entered into by the Executive which compelled the Parliament to do so if Australia were not to be in breach of international law. But once the scheme was created, and once the appellant applied for a visa, she had a right to due process according to law. She had an interest in that process being pursued, and a legitimate expectation that it would be pursued. If the appellant is in due course able to explain satisfactorily the adverse material on which the respondent's delegate relied, the failure of the delegate to inform the appellant of the adverse material before deciding against her could then be said to have harmed her interests in a way amounting to a great injustice. Whether it would in fact have generated that harm is something that only the future will tell. But in those circumstances it may be thought to be surprising that the respondent chose to resist the present appeal. Whether or not the respondent's resistance to the appeal is surprising, the weapons to hand are too feeble and the resistance fails. The appeal must be allowed for the following reasons. A simple form of reasoning The appellant's case can be stated in the following way. Section 51A(1) renders Pt 2 Div 3 subdiv AB "an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with." The expression "the requirements of the natural justice hearing rule" means the general law requirements of the natural justice hearing rule. Therefore s 51A(1) does not render Pt 2 Div 3 subdiv AB an exhaustive statement of the general law requirements of the natural justice hearing rule in relation to the matters it does not deal with. (d) One matter which Pt 2 Div 3 subdiv AB deals with is the matter dealt with in s 57 – the possibilities for the respondent's obligations concerning the treatment of "relevant information", or information of a more general kind, in relation to onshore visa applicants. Section 57 does not deal with the possibilities for the respondent's obligations concerning the treatment of "relevant information", or information of a more general kind, in relation to offshore visa applicants: It is impossible to read ss 51A and 57 together as taking away the application of the general law requirements of the natural justice hearing rule to the subject of "relevant information" in relation to offshore visa applicants. Section 57(3) expressly provides that s 57 does not apply to a class to which the appellant belongs. (g) Without the aid to be found in the sharp stimulus of a particular controversy, it may be difficult to state fully the general law requirements of the natural justice hearing rule. But those requirements in their application to the present circumstances did create a duty on the respondent's delegate to give the appellant "a fair opportunity to correct or contradict any relevant material prejudicial to [her]"76. Hence the delegate had a duty to bring to the appellant's attention the information which the Australian immigration officers had discovered in Pakistan before reaching an adverse decision, so that the appellant might comment on it with a view to qualifying it, explaining it or refuting it. The delegate advised the appellant of that information in the decision record, but did not do so before the decision was reached. Therefore the delegate failed to afford the appellant natural justice and the respondent's decision was void. The respondent's preliminary point Unless that reasoning is open to valid criticism, it must be accepted. The respondent launched several attacks on steps (d) and (f). Before going to them, it is desirable to note a preliminary point which the respondent made. Section 51A was introduced in 2002, but it was not introduced alone77. At the same time equivalent provisions were introduced into other parts of the Act – s 97A into Pt 2 Div 3 subdiv C, s 118A into Pt 2 Div 3 subdiv E, s 127A into Pt 2 Div 3 subdiv F, s 357A into Pt 5 Div 5 and s 422B into Pt 7 Div 4. Counsel for the respondent submitted that these amendments to the Act were to be seen as part of a unified attempt to ensure that the particular "codes", as he called them, in each of those divisions or subdivisions exhaustively stated the requirements of the "procedural fairness hearing rule". Consistently with that submission, in putting 76 Kioa v West (1985) 159 CLR 550 at 569 per Gibbs CJ; [1985] HCA 81. 77 Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). arguments about the construction of s 51A the respondent relied on authorities on equivalent provisions, for example ss 357A78 and 422B(1)79. The "single subject matter construction" The first of the respondent's attacks on steps (d) and (f) of the above reasoning was a submission that the expression in s 51A(1) "the matters it [ie Pt 2 Div 3 subdiv AB] deals with" was a reference to a single subject matter to be found in the subdivision as a whole. It was not a reference to the separate subject matters which each section of the subdivision, one by one, dealt with. The single subject matter was that described in the heading to the subdivision as the "procedure for dealing … with visa applications". If the submission were sound, Pt 2 Div 3 subdiv AB would completely exclude the general law requirements of the natural justice hearing rule. The respondent submitted that this "single subject matter construction" was supportable for five reasons. The respondent's first reason: singular number. The first reason was said to be that "textually it best fits the use of the singular in subsection (1)" ("[t]his Subdivision" and "it deals"). A similar idea was referred to by Lindgren J in relation to s 357A in NAQF v Minister for Immigration and Multicultural and Indigenous Affairs80. He said that there were two textual considerations "which may be thought to support"81 the "single subject matter construction". One was "the contrast between the singular form of s 357A(1) ('This Division is taken to be … it deals with') and the plural form of s 357A(2) ('Sections 375, 375A and 376 and Div 8A … are taken to be … they deal with')."82 Transferred to s 51A, the argument contrasts the words in s 51A(1) "is taken" and "it deals with" with the words in s 51A(2) "are taken" and "they deal with". The argument would only work if in s 51A(1) "matters" read "matter" and if s 51A(2) concluded "matters each of them dealt with"83. But the legislation does not take this form. As Lindgren J suggested in relation to another section, the use of the word "matters" in s 51A(1) directs the inquiry to more than one matter, and includes 78 NAQF v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 130 FCR 456. 79 VXDC v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 146 FCR 562. 80 (2003) 130 FCR 456 at 469 [62]. 81 (2003) 130 FCR 456 at 469 [61]. 82 (2003) 130 FCR 456 at 469 [62]. 83 For the text of s 51A see [3] above. the possibility that the matters may be diverse84. The central difficulty with the respondent's argument is that the word "matters" is in the plural. The fact that the subject of the word "deals" is in the singular is of no significance in working out what is dealt with; the fact that the object of the word "deals" is in the plural, not the singular, is annihilating. And while the question in this Court is one of principle, not judicial reputation or curial authority, it cannot be said that any part of Lindgren J's judgment lends any strength to the respondent's argument. In particular, although Lindgren J recorded the point, he also found it uncompelling and unpersuasive85. The respondent's second reason: related provisions. The second reason advanced by the respondent for the "single subject matter construction" was the identical use of language in ss 97A, 118A, 127A, 357A and 422B. It was submitted that each section introduces a division or subdivision dealing with a different procedural code. It was submitted that the words "in relation to the matters it deals with" was a repeated formula – "a not inappropriate generic formula for distinguishing between the subject matters of those six different sets of provisions, not for singling out matters within each of those six sets." The respondent said that the point had been "very well made" by Lindgren J in NAQF v Minister for Immigration and Multicultural and Indigenous Affairs86. The answer is that, while the formula performs the function ascribed to it by the respondent, it does not perform only that function. If it performed only that function, the word "matter" would have been used, not "matters". The respondent's citation of NAQF v Minister for Immigration and Multicultural and Indigenous Affairs has a Pyrrhic character. Lindgren J did make the point, but only very tentatively. The tentativeness is seen in the words to which emphasis has been added in the following passages. Lindgren J said: "The drafter may have invoked the expression 'in relation to the matters they deal with' as a universally applicable general formula for distinguishing between the six contexts."87 By the "six contexts" he meant ss 51A, 97A, 118A, 127A, 357A and 422B. Lindgren J also said that, taking s 357A88: "as an illustration, the drafter may well have been attempting to say that [Pt 5] Div 5 is taken to be an exhaustive statement of the requirements of 84 (2003) 130 FCR 456 at 468 [58]. 85 (2003) 130 FCR 456 at 470 [65]. 86 (2003) 130 FCR 456 at 469-470 [63]-[64]. 87 (2003) 130 FCR 456 at 470 [64]. 88 (2003) 130 FCR 456 at 470 [64]. the natural justice hearing rule in relation to the subject matter of [Pt 5] Div 5 as distinct from the subject matter of the respective Divisions and Subdivisions in which the other five sections were to be inserted." Lindgren J did make the point very well. But, as those tentative words foreshadow, he also rejected it very firmly. He reached the conclusion that the second argument, like the first, was uncompelling and unpersuasive89. The respondent's third reason: context. The third reason advanced by the respondent was that s 51A had to be read in context. One aspect of the context was said to be set by the heading of the subdivision: "Code of procedure for dealing fairly, efficiently and quickly with visa applications". Another aspect of the context was said to lie in the location of s 51A at the start of a series of provisions setting out detailed steps in a procedure for dealing with visa applications. This, the respondent argued, suggested that the words "in relation to the matters [the subdivision] deals with" referred to the totality of what the respondent called a "code for integrated procedure". Again the submission founders on the legislative use of the word "matters", not "matter". And so far as the submission relies on the heading, it faces the following difficulty. Part 2 Div 3 subdiv C, Pt 2 Div 3 subdiv E, Pt 2 Div 3 subdiv F, Pt 5 Div 5 and Pt 7 Div 4 contain equivalents to s 51A. But the headings to those divisions and subdivisions do not contain language equivalent to that used in the heading to Pt 2 Div 3 subdiv AB. They are not directed expressly to any "code of procedure". The respondent's fourth reason: responding to Miah's case. The respondent also submitted that s 51A was a direct response to Re Minister for Immigration and Multicultural Affairs; Ex parte Miah90. In that case Gaudron J said, and McHugh and Kirby JJ held, that the Act, particularly Pt 2 Div 3 subdiv AB as it then was, did not exclude the application of the general law rules of procedural fairness. The respondent pointed to McHugh J's statement that subdiv AB did not declare that the formal procedures set out in the subdivision "exhaustively" defined the content of fair procedure91. The respondent also pointed to Kirby J's use of the words "exhaust" and "exhaustive" to make the same point92. And the respondent submitted that it was no coincidence that the Parliament had used the words "exhaustive statement" in s 51A(1) and (2). There 89 (2003) 130 FCR 456 at 470 [65]. 90 (2001) 206 CLR 57; [2001] HCA 22. 91 (2001) 206 CLR 57 at 94 [128]. 92 (2001) 206 CLR 57 at 113 [181] and [183]. are similar statements in the Explanatory Memorandum and the Second Reading Speech. The Explanatory Memorandum stated that it was proposed to amend the Act "to provide a clear legislative statement that specified 'codes of procedure' in the Act are an exhaustive statement of the requirements of the natural justice hearing rule."93 The Second Reading Speech described Miah's case, attributed certain consequences to it, and said the purpose of s 51A and its counterparts was to make it "expressly clear" that particular codes in the Act do "exhaustively state the requirements of the … procedural fairness hearing rule"94. But what did these statements mean? Not surprisingly the Explanatory Memorandum and the Second Reading Speech reveal some discontent with the majority view in Miah's case. They proceed on the view that s 51A was "necessary to restore the [Parliament's] original intention that the … Act should contain codes … that do replace the common law requirement of the natural justice hearing rule."95 The preference of the government appears to have been for the minority approach of Gleeson CJ and Hayne J in Miah's case. That approach was summarised by Gleeson CJ and Hayne J, after they had analysed various provisions in Pt 2 Div 3 subdiv AB, as follows96: "These provisions, read in the context of legislation which requires the decision-maker to give reasons, and entitles an unsuccessful applicant to a full review of the decision on the merits, evince an intention on the part of the legislature to prescribe comprehensively the extent to which, and the circumstances in which, the Minister or delegate is to give an applicant an opportunity to make comments or submissions, or provide information, in addition to the information in the original application or any supplementary information furnished by the applicant before a decision is made." (emphasis added) The respondent submitted that the Parliament was clearly seeking to invoke that view. The respondent submitted that the above sentence expresses "in quite 93 Australia, House of Representatives, Migration Legislation Amendment (Procedural Fairness) Bill 2002, Explanatory Memorandum at 2 [1]. See also at 2 [4], 3 [7] and 5-10 (Sched 1). 94 Australia, House of Representatives, Parliamentary Debates (Hansard), 13 March 95 Australia, House of Representatives, Parliamentary Debates (Hansard), 13 March 96 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 74 [49]. precise terms what it is that should be taken to be the legal effect of section 51A." There are grave difficulties with these submissions. Mr Miah was an onshore visa applicant, and their Honours were speaking of onshore visa applicants. The present context is different from the context their Honours described. The present context concerns the impact of the Act on offshore visa applicants. Section 66 of the Act does not require "the decision- maker to give reasons" and s 338 does not entitle "an unsuccessful applicant to a full review of the decision on the merits". It is not sufficiently clear that the Parliament was seeking to invoke a view stated in relation to onshore visa applicants with certain significant statutory rights and apply it to offshore visa applicants without those rights. The right of onshore visa applicants to review on the merits may not diminish whatever rights to procedural fairness they otherwise have. But the absence of any right in offshore visa applicants to review on the merits strengthens the unlikelihood that the Act excludes their right to procedural fairness. It also strengthens the need for clear language if a construction to that effect is to be adopted. Further, the extrinsic materials do not direct attention to one question, crucial to the present appeal: is the "single subject matter construction" correct? And they do not discuss the meaning of the vital words "in relation to the matters it deals with". In short, as is very common, reading the Explanatory Memorandum and the Second Reading Speech is much less helpful than reading the legislation itself. No doubt, as the respondent submitted, those materials establish that the government had the "intention" of overturning the "result" of Miah's case. Perhaps the respondent is right to call the indications of this intention "overwhelming". Perhaps the Full Court of the Federal Court in Minister for Immigration and Multicultural and Indigenous Affairs v Lat was right to say that the intention could not have been made "any clearer"97. But what was the content of that "intention"? What was the "result" of Miah's case which the government intended to overturn? Miah's case established the position for onshore visa applicants to whom s 57 applies. An intention to overturn, or an actual overturning of, that result is one thing. But it does not say anything decisive about any intention to legislate in relation to the position for offshore visa applicants to whom s 57 does not apply. In any event, the ultimate question is not what the Parliament intended to do, but what it actually did. What the Parliament actually did turns on the meaning of the controversial expression "in relation to the matters it deals with". That expression has no parallel in Miah's case. On the occasions when the respondent's submissions gave that phrase attention, they read "matters" as "matter". There is no warrant for this. However, commonly the respondent's submissions did not attach 97 (2006) 151 FCR 214 at 225 [65]. significance to the phrase at all. Yet it is a vital expression. That is because it has a limiting character. It gives s 51A(1) a narrower effect than it would have if it were not there. And the narrowing effect stems from the word "matters". That word means that the fourth argument of the respondent for the "single subject matter construction", like the first three, must fail. The respondent's fifth reason: does rejection of the "single subject matter construction" give s 51A work to do? The respondent's fifth reason for supporting the "single subject matter construction" of s 51A was that to reject it and adopt a multiple subject matter approach would give s 51A no work to do. The respondent submitted that the expression "the matters it deals with" in s 51A(1) must refer to something wider than the exact text of the enacted procedural requirements, otherwise s 51A(1) would be superfluous. The respondent submitted that the legislation cannot be construed so that the displacement of the natural justice hearing rule is co-extensive with, but does not go beyond, the text of the enacted procedural requirements. The respondent submitted that if that were the case, the result would be that the general law requirements of the natural justice hearing rule would continue to exist as potential grounds for relief in areas outside those specifically dealt with. In effect, the respondent's contention was that s 51A(1) would have achieved nothing beyond that which the specific provisions did, and would be wholly otiose – which points to error in the construction which leads to that result. The respondent's submission adopted certain reasoning stated by Lindgren J in NAQF v Minister for Immigration and Multicultural and Indigenous Affairs98. Lindgren J gave an illustration in relation to s 357A(1) (which corresponds with s 51A(1))99: "For example, within [Pt 5] Div 5, s 360(1) provides as follows: 'The Tribunal must invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review.' If s 357A(1) signified that the natural justice hearing rule was excluded only to the precise extent that it would have required the Tribunal to 'invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review' … and no further, s 357A(1) would have achieved nothing in the present respect: the rule would survive as a ground for relief outside the parameters of s 360(1)." 98 (2003) 130 FCR 456 at 468-469 [59]. 99 (2003) 130 FCR 456 at 469 [59]. The corresponding example in relation to s 57 is that the natural justice hearing rule is excluded only to the precise extent that it would have required the respondent to give particulars of the "relevant information" in an appropriate way, to ensure that the applicant understood why it is relevant, and to invite the applicant to comment on it. Assuming but not deciding that the respondent's submission is correct in terms, and accepting that it is supported by Lindgren J, it must be noted that Lindgren J nonetheless went on to indicate an inclination against the "single subject matter construction"100. He also said that the expression "the matters it dealt with" referred to "larger subject matters than the exact text of the procedural fairness requirements"101. the respondent's obligations The word "matter" when applied to s 57 can have a meaning which does not render s 51A(1) superfluous or otiose. And there is no reason why a given provision cannot be said to deal with more than one matter. The matter of the precise rule enacted by s 57 is one matter, but another matter is the subject or subjects to which the rule applies. The subject (or subjects) to which the rule applies is wider than the content of the rule. In s 57, one subject is the range of possibilities for to onshore visa applicants concerning the treatment of "relevant information". That is a matter wider than the precise text of s 57(2) because it extends to other possible steps the respondent might be obliged to take pursuant to the general law requirements of the natural justice hearing rule. A yet wider subject, and hence "matter", is the subject of the possibilities for the respondent's obligations concerning the treatment of information which the respondent considers would be a reason, or part of a reason, for refusing to grant a visa and which was not given by the applicant for the purpose of the application (ie "relevant information" as defined in s 57(1) but without par (b)). On either of these wider meanings, it cannot be said that s 51A(1) is otiose. It is true that, on either view, s 51A does less work than it would on the respondent's preferred "single subject matter construction", but it does do some work. Although it is not necessary to decide the point, s 51A very probably reverses Miah's case in the sense that, leaving aside the present appellant's constitutional arguments, if the facts of that case now arose, the point on which Mr Miah had majority support would be decided adversely to him. A further illustration of the work done by s 51A is this. A construction abolishing the general law requirements of the natural justice hearing rule is not 100 (2003) 130 FCR 456 at 475 [83]. 101 (2003) 130 FCR 456 at 469 [60]. to be inferred "from the presence in the statute of rights which are commensurate with some of the rules of natural justice"102. It follows that the enactment of s 57 did not abolish any additional general law requirements of the natural justice hearing rule. the subdivision providing elements corresponding functionally to parts of the general law requirements of the natural justice hearing rule did not by themselves abolish any additional general law requirements. To ensure that, in the area to which it applied, s 57 was exhaustive of the rules of natural justice, it was necessary to enact s 51A. Other provisions Secondly, let it be accepted that that rejection of the respondent's submissions means that the work which s 51A is to do is limited. That does not point against the approach involved in either of the two characterisations of "matter" in relation to s 57 just postulated. That is because the more widely s 51A is construed and the less scope it leaves for the general law requirements of the natural justice hearing rule, the clearer the language needed to achieve this result would have to be. The language is insufficiently clear. The legislative scheme does not give unequivocal emphasis to s 51A as having a wide application. Nor, indeed, do the extrinsic materials on which the respondent placed much stress. Both the Act and the extrinsic materials are compatible with s 51A having a narrow application. Section 51A was introduced in 2002, the year after s 474 in a new form had been inserted into the Act, and the year before this Court decided the construction of s 474103. Section 474 was an "ouster clause" or "privative clause" which on one view prevented any court granting relief with respect to most decisions under the Act. It was a view underpinning the Second Reading Speech relating to s 51A. That Speech treated s 474 not as having a narrow meaning, but as being a section which "greatly expands the legal validity of acts done and decisions made by decision-makers"104. The construction actually arrived at by this Court was that s 474 did not protect decisions involving a jurisdictional error from judicial review. In the cases in which this Court decided that that was the correct construction, the Commonwealth had submitted that it had a wider meaning. One aspect of the wider meaning it urged was that s 474 should be construed as excluding any implied obligation of 102 Annetts v McCann (1990) 170 CLR 596 at 598 per Mason CJ, Deane and McHugh JJ; [1990] HCA 57. They cited Baba v Parole Board of New South Wales (1986) 5 NSWLR 338 at 344-345, 347 and 349. 103 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476; [2003] HCA 2. 104 Australia, House of Representatives, Parliamentary Debates (Hansard), 13 March procedural fairness105. If that submission as to the correct construction of s 474 had been correct, it would have left no work for s 51A to do when it was enacted in the following year. And if the broad construction of s 474 underlying what was said in the Second Reading Speech when s 51A was introduced were correct, very little work would have been left for s 51A to do. Here, as elsewhere, the extrinsic materials do not go far enough to achieve the respondent's goals. The subject matter of s 57 For those reasons the respondent's five arguments in favour of the "single subject matter construction" must be rejected. On that basis, the respondent submitted in the alternative that the subject matter of s 57 was "the provision of information known to the Minister which would be adverse to an applicant's application". It is inherent in that submission that the following words should be added at the end: "whether the applicant is an onshore visa applicant or an offshore visa applicant". That is, the submission rejected the limitation of "matter" to onshore visa applicants which was found in the two versions of "matter" discussed under the previous heading. But the respondent did not explain why that limitation should be abandoned and why so wide a subject matter should be found to exist in view of the limits set by s 57(3) to the scope of s 57. Because s 57(3) expressly provides that s 57(2) "does not apply" in relation to relevant information received by the respondent in respect of certain applications involving offshore visa applicants, that matter is not a matter dealt with by the subdivision. Hence s 51A(1) has no application to it. The appeal to anomaly Another obstacle which the respondent raised to the appellant's case was an appeal to anomaly. The supposed anomaly was put thus in Minister for Immigration and Multicultural and Indigenous Affairs v Lat106: "The Legislature could hardly have intended to provide the full panoply of common law natural justice to visa applicants who are required to be outside Australia when the visa is granted, while conferring a more limited form of statutory protection upon onshore applicants." 105 That was argued in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicant S134/2002 (2003) 211 CLR 441 at 447; [2003] HCA 1. The same argument was put in Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476: see at 479. 106 (2006) 151 FCR 214 at 225-226 [68]. If the language of "intention" is abandoned and replaced by the language of construction, the argument is that a construction which leads to offshore visa applicants having better rights than onshore visa applicants is so absurd or unreasonable that it cannot be preferred. However it is put, this appeal to anomaly is unconvincing. The construction advanced by the appellant is not absurd or unreasonable. Even if it were unreasonable, it is far more reasonable than the respondent's construction. The respondent's construction would give substantial natural justice to onshore visa applicants in relation to "relevant information", but none at all to offshore visa applicants. Further, the process of judging whether it is anomalous or unreasonable that the general law requirements of the natural justice hearing rule may offer better protection to offshore visa applicants than s 57 offers to onshore visa applicants has to be carried out bearing in mind a key contrast. Applicants in the former class, unlike the latter, have no right to reasons and no right of merits review before the Migration Review Tribunal. In assessing the argument from anomaly it is also necessary to bear in mind that the authoritative construction of certain parts of the Act has flowed from two principles. One is that legislation is not lightly to be construed as abolishing the natural justice hearing rule. The second is that legislation should be construed so that it operates within constitutional power, not outside it107. The consequence of these principles is that the judicial construction of some parts of the legislation may diverge from that which its framers may subjectively have intended. A further consequence is that those parts, so construed, may not fit perfectly with other parts, which can be construed in accordance with the framers' intentions. This is simply an illustration of how the search for the intent of legislators rather than the meaning of legislation can be both delusive and lacking in utility. That is not sufficient to characterise the lack of "fit" as an "anomaly" which is so absurd or irrational that it points away from a particular construction. Notice of contention The respondent's argument. The respondent's argument in relation to the notice of contention rested on the terms of s 57 by itself, read quite independently of s 51A. The argument was that, if it is correct that the natural justice hearing rule applies by virtue of an implication into the relevant statute, one should not make an implication that would render an express provision of the statute redundant. Section 57, it was submitted, ought not to be read by implication as requiring relevant information to be given to applicants of the class described in 107 For example, Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476. See also Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [28]; [2000] HCA 33. s 57(3) where s 57 expressly provides that they are not to be given that information. The impact of s 51A. That submission must be rejected. It does what the respondent accepted must not be done, namely, to read s 57 as if s 51A were not there, when s 51A is there "and demands by its terms that it be taken into account". Section 57(2) gives to onshore visa applicants the rights described in s 57(2), but ss 51A and 57(2) in combination deny them any further rights. On the other hand, s 57(3) causes the specific obligations contained in s 57(2) not to be imposed: thus s 57(3) prevents the class described in it from enjoying the advantages given by s 57(2) and from suffering the disadvantages created by s 51A. There is thus no repugnancy in finding an implication in the Act, if that is the correct approach, that persons in the excluded s 57(3) class are to be accorded the benefits of the natural justice hearing rule, while also construing s 57 when read with s 51A as giving onshore visa applicants some of those benefits but not necessarily all of them. The argument considered independently of s 51A. Even if s 51A is left out of account, the respondent's submission rests on drawing an inference from the grant of some elements of natural justice to one class of applicants that natural justice to another class is excluded. It would be wrong to infer from the legislative grant of some elements of natural justice to one class that all other elements are excluded in relation to that class by the legislation108. It is even more plainly wrong to infer from the grant of some elements of natural justice to one class of applicants that natural justice to another class is excluded. In short, s 57 does not remove the advantages of procedural fairness from the classes of persons described in s 57(3). It simply fails to impose a s 57(2) obligation in relation to that class, while leaving applicable to it whatever general law requirements of the natural justice hearing rule apply. "Policy choices". The respondent, perhaps sensing that a construction of the legislation which left offshore visa applicants without any right to deal with "relevant information" lacked attractiveness, submitted that that consequence was but part of a wider scheme to be discerned within the Act, pursuant to which offshore visa applicants received differential treatment compared to onshore visa applicants. Onshore visa applicants are entitled to reasons and merits review, but can only apply once (ss 48-48A). Offshore visa applicants are not entitled to reasons and merits review, but can apply more than once. These differences were said by the respondent to be "the result of policy choices by Parliament, reflecting matters of administrative convenience, including distance, and 108 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 93 [126] and 96 [139]. budgetary and workload considerations." Where the language of the Act establishes differential treatment, it must be given effect whatever the matters underlying the legislative judgment. But the language of s 57 does not create differential treatment in relation to natural justice as extreme as the respondent's submission suggests. The respondent's submission about the factors underlying the legislative policy choices suggested that the general law requirements of the natural justice hearing rule "would reduce to nothing, or practically nothing, in the case of many [offshore] visa applicants." Even if that is so in some instances, it does not follow that it is necessarily so in others. It does not follow from the limited protection given by the general law requirements of the natural justice hearing rule in the case of some s 57(3) persons that there is no protection at all. Matters which it is not necessary to deal with All the respondent's challenges to the appellant's case as set out at the commencement of this judgment fail. It is therefore not necessary to consider various other matters in controversy. Among them are the following. It is not necessary to consider whether the natural justice hearing rule applies because of a presumption that it will not readily be abolished or, as the respondent put it, because of "an implication into the statute". It is not necessary to determine the precise test for ascertaining what language is needed to limit or remove the duty of procedural fairness – whether language of "irresistible clearness" is needed, or whether language of "a high degree of certainty" suffices. And it is not necessary to consider the three constitutional arguments which the appellant advanced.
HIGH COURT OF AUSTRALIA AND THE QUEEN APPLICANT RESPONDENT [2020] HCA 12 Date of Hearing: 11 & 12 March 2020 Date of Judgment: 7 April 2020 ORDER Special leave to appeal granted. Appeal treated as instituted and heard instanter and allowed. Set aside order 2 of the orders of the Court of Appeal of the Supreme Court of Victoria made on 21 August 2019 and, in its place, order that: the appeal be allowed; and the appellant's convictions be quashed and judgments of acquittal be entered in their place. On appeal from the Supreme Court of Victoria Representation B W Walker SC with R B Shann for the applicant (instructed by Galbally & O'Bryan) K E Judd QC with M J Gibson QC and A S Ellis for the respondent (instructed by Office of Public Prosecutions Victoria) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Sexual offences against children – Appeal against conviction by jury on ground that verdict unreasonable or cannot be supported having regard to whole of evidence – Where prosecution case wholly dependent upon acceptance of truthfulness and reliability of complainant's account – Where jury assessed complainant's evidence as credible and reliable – Where witnesses gave unchallenged evidence of specific recollections, practices and routines inconsistent inconsistent with acceptance of complainant's account evidence") – Where Court of Appeal required to take into account forensic disadvantage experienced by applicant – Whether prosecution negatived reasonable possibility that applicant did not commit offences – Whether Court of Appeal required applicant to establish offending impossible to raise reasonable doubt – Whether unchallenged inconsistent evidence required jury, acting rationally, to have entertained doubt as to applicant's guilt. ("unchallenged Criminal practice – Appeal – Video evidence – Where evidence of complainant and other witnesses recorded – Where Court of Appeal viewed recorded witness testimony – Whether proper discharge of appellate court's function necessitated review of recorded witness testimony. Words and phrases – "beyond reasonable doubt", "compounding improbabilities", "credibility and reliability", "function of the appellate court", "function of the jury", "impossibility", "improbability of events", "invariable practice", "jury's advantage in seeing and hearing the witnesses", "negatived the reasonable possibility", "opportunity witnesses", "realistic opportunity for the offending to have occurred", "religious ritual", "routines and practices", "significant forensic disadvantage", "significant possibility that an innocent person has been convicted", "solid obstacles to conviction", "standard and burden of proof", "unchallenged evidence", "uncorroborated", "video-recordings of the witnesses at trial". Crimes Act 1958 (Vic), ss 45(1), 47(1). Criminal Procedure Act 2009 (Vic), ss 276(1)(a), 378, 379(b)(i). Judiciary Act 1903 (Cth), s 37. Jury Directions Act 2015 (Vic), ss 4A, 39. KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ. On 11 December 2018, the applicant was convicted following a trial before the County Court of Victoria (Chief Judge Kidd and a jury) of one charge of sexual penetration of a child under 16 years1 and four charges of committing an act of indecency with or in the presence of a child under the age of 16 years2. The offences charged in the first four charges were alleged to have been committed on a date between 1 July and 31 December 1996. The fifth charge was alleged to have been committed between 1 July 1996 and 28 February 1997. All the offences were alleged to have been committed in St Patrick's Cathedral, East Melbourne ("the Cathedral"), following the celebration of Sunday solemn Mass and within months of the applicant's installation as Archbishop of Melbourne. The victims of the alleged offending were two Cathedral choirboys, "A" and "B". Procedural history A made his first complaint about the alleged assaults in June 2015. The prosecution case was wholly dependent upon acceptance of the truthfulness and the reliability of A's evidence. By the time A made his complaint, B had died in accidental circumstances. In 2001, B had been asked by his mother whether he had ever been "interfered with or touched up" while in the Cathedral choir. He said that he had not. This was the second trial of these charges, the jury at the first trial having been unable to agree on its verdicts. The applicant sought leave to appeal against his convictions to the Court of Appeal of the Supreme Court of Victoria (Ferguson CJ, Maxwell P and Weinberg JA). He was granted leave on a single ground (ground 1), which contended that the verdicts were unreasonable and could not be supported by the evidence. The members of the Court of Appeal viewed the recording of A's evidence, and that of a number of other prosecution witnesses. The majority, Ferguson CJ and Maxwell P, assessed A as a compellingly credible witness. There was 1 Crimes Act 1958 (Vic), s 45(1). 2 Crimes Act 1958 (Vic), s 47(1). Bell Nettle Gordon Edelman evidence, adduced in the prosecution case from witnesses described as "the opportunity witnesses", with respect to the applicant's and others' movements following the conclusion of Sunday solemn Mass, which was inconsistent with acceptance of A's account. Their Honours concluded that no witness could say with certainty that the routines and practices described by the opportunity witnesses were never departed from3. Their Honours reviewed a number of "solid obstacles" to conviction and in each case concluded that the jury had not been compelled to entertain a doubt as to the applicant's guilt. Weinberg JA, in dissent, considered that, in light of the unchallenged evidence of the opportunity witnesses, "the odds against [A's] account of how the abuse had occurred, would have to be substantial"4. His Honour concluded that the jury, acting reasonably on the whole of the evidence, ought to have had a reasonable doubt as to the applicant's guilt. The applicant applied for special leave to appeal from the judgment of the Court of Appeal on two grounds. The first proposed ground contends that the Court of Appeal majority erred by finding that their belief in A required the applicant to establish that the offending was impossible in order to raise and leave a doubt. The second proposed ground contends that the Court of Appeal majority erred in their conclusion that the verdicts were not unreasonable as, in light of findings made by their Honours, there remained a reasonable doubt as to the existence of any opportunity for the offending to have occurred. On 13 November 2019, Gordon and Edelman JJ referred the application for special leave to appeal to a Full Court for argument as on an appeal. The application was heard on 11 and 12 March 2020. Disposition For the reasons to be given, it is evident that there is "a significant possibility that an innocent person has been convicted because the evidence did 3 Pell v The Queen [2019] VSCA 186 at [166]. 4 Pell v The Queen [2019] VSCA 186 at [1064]. Bell Nettle Gordon Edelman not establish guilt to the requisite standard of proof"5. Special leave to appeal should be granted on both grounds and the appeal allowed. The respondent submitted that, in the event special leave were granted and the appeal allowed, the matter should be remitted to the Court of Appeal or relisted before this Court so that the whole of the evidence might be placed before it. The respondent's submission with respect to the consequential order is rejected. The submission that the Court does not have before it the material to enable it to determine whether the verdicts are unreasonable or cannot be supported by the evidence is specious. Each party placed before the Court all the evidence that it considered relevant to the determination of the applicant's proposed second ground of appeal and each party addressed written and oral submissions as to the inferences to be drawn from it. This Court is empowered to give, and should give, such judgment as ought to have been given by the Court of Appeal6. As will appear, the Court of Appeal majority's findings ought to have led to the appeal being allowed. It follows that the order of the Court of Appeal must be set aside and in its place the appeal to that Court allowed, the applicant's convictions quashed and verdicts of acquittal entered. The layout of the Cathedral and the conduct of processions Before outlining A's allegations, there should be reference to aspects of the layout of the Cathedral and its surrounds, and to the manner in which the applicant, his attendants and the choir ordinarily processed from the Cathedral at the conclusion of Sunday solemn Mass at the time of the alleged offending. Adjoining the Cathedral at the rear is a modern building called the "Knox Centre". A metal gate at the eastern end of the Cathedral on its southern side opens into a short corridor between the Cathedral and the Knox Centre. The corridor gives access to several toilets and was referred to as the "toilet corridor". At the end of the toilet corridor, a glass door opens onto a small vestibule. To the right, as one passes through the glass door from the toilet corridor, there is a fire door which gives access to the Knox Centre. The choir room, in which the choir robed, was located in the Knox Centre. To the left, as one passes through the glass door from the toilet 5 Chidiac v The Queen (1991) 171 CLR 432 at 444 per Mason CJ, citing Chamberlain v The Queen [No 2] (1984) 153 CLR 521 at 618-619 per Deane J; see also M v The Queen (1994) 181 CLR 487 at 494 per Mason CJ, Deane, Dawson and Toohey JJ. Judiciary Act 1903 (Cth), s 37. Bell Nettle Gordon Edelman corridor, there is a door which gives access to another corridor ("the sacristy corridor"). The sacristy corridor is within the Cathedral but is not open to the public. On the southern side of the sacristy corridor, closest to the vestibule, is the archbishop's sacristy. The priests' sacristy is next to the archbishop's sacristy. Opposite both is a room which at the time was known as the "utility room" and was used by the altar servers as a robing room. Access to the sacristy corridor can also be gained through a set of double doors at the eastern end of the south transept. After the dismissal at the end of Sunday solemn Mass, the choir, attendants and clergy formally processed down the Cathedral's centre aisle to the great west door. The procession was led by the altar servers; next came the choir comprising around 50 boys, ranging from grade 3 to grade 12, and around 12 adult male singers; they were followed by the choirmaster, and concelebrant and other priests. The applicant, with his master of ceremonies, Monsignor Portelli, came last. They were accompanied by two further altar servers. The choir processed in file two-by- two in strict order with the sopranos first, followed by the altos, the tenors, the basses and the adult choristers. The choir marshal ensured that the procession maintained discipline. On fine days, the procession proceeded out through the west door. It was the applicant's practice to leave the procession at this point and remain on the steps of the Cathedral, with Portelli, to greet congregants as they were leaving. This "meet and greet" was estimated to have taken between ten minutes and half an hour on an ordinary day on which the applicant did not have an engagement in the afternoon. Meanwhile, the procession turned to its left and processed around the southern side of the Cathedral to the metal gate and into the toilet corridor. The choristers returned to the choir room in the Knox Centre and the altar servers and priests entered the Cathedral through the sacristy corridor. The altar servers entered the priests' sacristy and in formation bowed to the crucifix, thereby marking the formal end of the proceeding. If the weather was inclement, the procession processed down the centre aisle to the west door and processed back along the southern aisle, through the double doors in the south transept and into the sacristy corridor. The choristers walked along the sacristy corridor through the door to the vestibule and into the choir room in the Knox Centre, while the altar servers entered the priests' sacristy and bowed to the crucifix. Bell Nettle Gordon Edelman A's evidence A and B were aged 13 years at the time of these events. A was a soprano. It was his evidence that, following Sunday solemn Mass, he and B had broken away from the procession at a point when it was approaching the metal gate to the toilet corridor. The two of them had slipped away and gone back into the Cathedral through the door to the south transept. The double doors from the south transept to the sacristy corridor were unlocked and they made their way down the corridor to the priests' sacristy, which was unlocked. They went inside and were "poking around". In a cupboard in an alcove they found a bottle of red altar wine. They had barely taken a couple of swigs from the bottle when the applicant appeared in the doorway. He was standing alone in his robes. He challenged them, saying, "[w]hat are you doing in here?" or "[y]ou're in trouble". A and B froze. The applicant undid his trousers and belt and started "moving ... underneath his robes". The applicant pulled B aside, took his penis out and lowered B's head towards it. A saw the applicant's hands around the back of B's head. B was crouched before the applicant and his head was down near the applicant's genitals (charge one). B said "[c]an you let us go? We didn't do anything." This assault took place for "barely a minute or two". Next, the applicant turned to A, pushing him down into a crouching position. The applicant was standing and his penis was erect. He pushed his penis into A's mouth. This assault took place over a short period of time that "wouldn't have been any more than 2 minutes" (charge two). The applicant then instructed A to undo A's pants and to take them off. A dropped his pants and underwear and the applicant started touching A's penis and testicles (charge three). As he was doing this, the applicant used his other hand to touch his own penis (charge four). The applicant was crouched almost on one knee. These further acts of indecency occupied "a minute or two". A and B made some objections but did not quite yell out. They were sobbing and whimpering. The applicant told them to be quiet, in an attempt to stop them crying. After the applicant stopped, A gathered himself and his clothing. He and B re-joined some of the choir, who were mingling around in the choir room and finishing up for the day. A and B then left the Cathedral precinct. A recalled that they were picked up by his parents or B's parents. He did not complain to anyone, including his parents, about the incident. Nor did he ever discuss the offending with B. Bell Nettle Gordon Edelman At least a month after the first incident, again following Sunday solemn Mass at the Cathedral, A was processing with the choir back along the sacristy corridor towards the Knox Centre (the procession on this occasion was evidently an internal one). After A passed the doors to the priests' sacristy, but before reaching the door to the archbishop's sacristy, the applicant appeared and pushed A against the wall and squeezed his testicles and penis painfully. The applicant was "in his full regalia". The assault was fleeting. A did not say anything nor did he tell B about this second incident (charge five). A was uncertain of the date of each incident. He believed that both had occurred following a Sunday solemn Mass celebrated by the applicant in the second half of 1996, before Christmas. He maintained that the two incidents were separated by at least one month. The celebration of Sunday solemn Mass following the applicant's installation as Archbishop of Melbourne The applicant was installed as Archbishop of Melbourne on 16 August 1996 at a ceremony held in the Exhibition Building. The Cathedral was closed from Easter until the last week of November 1996 while renovations were being completed. The archbishop's sacristy was not available for the applicant's use throughout the period of the alleged offending. The applicant used the priests' sacristy to put on and remove his vestments in this period. Portelli and any other priests also used the priests' sacristy for robing. The first occasion on which the applicant celebrated Mass at the Cathedral was the vigil of Christ the King on the evening of Saturday, 23 November 1996. The first time the applicant celebrated Sunday solemn Mass in the Cathedral was on 15 December 1996. The only other occasion on which the applicant celebrated Sunday solemn Mass in the Cathedral in 1996 was on 22 December. The next occasion on which the applicant was present in the Cathedral for the celebration of Sunday solemn Mass was on 23 February 1997. The occasion was unusual in that the celebrant was Father Brendan Egan and not the applicant. The applicant presided at the Mass, a role which did not require him to speak. When presiding at solemn Mass the applicant wore his "choir robes": a purple cassock, which was worn under a white garment called a "rotchet" that extended down to the knees, and over which the applicant also wore a short purple cape. When celebrating solemn Mass, the applicant wore an alb, which is a white, ankle-length tunic, tied at the waist with a cincture, a rope knotted several times to Bell Nettle Gordon Edelman keep it in place; a stole; a cross around the neck; a green and gold cord worn down the back; a chasuble; a purple skull cap; and a mitre. In procession, the applicant carried a crosier. In the way the prosecution case was left to the jury, it was alleged that the first incident occurred on either 15 or 22 December 1996 and that the second incident occurred on 23 February 1997. The applicant's denials The applicant did not give evidence at the trial. In October 2016, he voluntarily participated in a video-recorded interview with the police, which was in evidence. In the course of the interview the applicant emphatically denied A's allegations, stating that "[t]he most rudimentary interview of staff and those who were choirboys" at the time would confirm not only that the allegations were "fundamentally improbable" but also that they were "most certainly false". The applicant told the investigating police that he and his master of ceremonies were at the front of the Cathedral after Mass "as I always did", while the sacristan and his assistant would be in the sacristy cleaning up and bringing out the vessels and other items from the Mass. The prosecution's pre-trial application Consistently with its obligation to call all witnesses whose evidence was necessary to give a complete account of material events7, the prosecution proposed to call 23 witnesses who were involved in the conduct of solemn Mass at the Cathedral or who were members of the choir in 1996 and/or 1997. The prosecution was presented with the difficulty that a number of its witnesses were expected to give evidence of practices that existed at the time of the alleged offending which, if followed, were inconsistent with the offending having occurred. The prosecution anticipated that a number of its witnesses would give evidence that these practices were followed with such strictness that there was no realistic possibility of the offending having occurred. 7 Whitehorn v The Queen (1983) 152 CLR 657 at 664 per Deane J, 674 per Dawson J. Bell Nettle Gordon Edelman In an attempt to confront this difficulty, the prosecutor applied to the trial judge for an advance ruling8 granting leave to cross-examine a number of his witnesses with respect to evidence that was expected to be unfavourable to the prosecution case and, in the case of the sacristan, Max Potter, with respect to a prior inconsistent statement9. The trial judge held that evidence adduced by the prosecution that was inconsistent with, or likely to contradict, A's account of events, was relevantly "unfavourable". His Honour granted leave to the prosecutor to cross-examine a number of witnesses (and foreshadowed the grant of leave in relation to other witnesses) with respect to six such topics10. These topics were: (i) whether the applicant was always in the company of another, including Portelli or Potter, when robed; (ii) whether the applicant always greeted congregants on the steps of the Cathedral following Sunday solemn Mass; (iii) whether the applicant's vestments could be moved to the side or parted so as to allow exposure of his penis; (iv) whether the doors from the south transept giving access to the sacristy corridor and the doors to the priests' sacristy were always locked in the period following Sunday solemn Mass; (v) whether the sacramental wine was always locked away and could not have been accessible; and (vi) whether it was possible for two choirboys to separate from the procession without being noticed. The leave granted, at least with respect to topics (i) and (ii), reflected the trial judge's satisfaction that the anticipated evidence, if accepted, excluded the realistic possibility of the offending having occurred as A described The prosecutor's opening In the event, the prosecutor pursued very limited cross-examination of his witnesses pursuant to the grants of leave. In opening his case to the jury, the prosecutor acknowledged that there were a number of seemingly irreconcilable differences between A's account and the evidence to be given by other prosecution witnesses. As the Court of Appeal majority encapsulated it, the prosecution case 8 Evidence Act 2008 (Vic), s 192A. 9 Evidence Act 2008 (Vic), s 38(1)(a), (c). 10 DPP v Pell (Evidential Ruling No 3) [2018] VCC 1231 at [32], [46], [48], [61], [63], [70], [74], [76], [87]-[89], [93], [100], [104], [110], Annexure A. Bell Nettle Gordon Edelman was that the evidence of the witnesses apart from A left open a realistic possibility that the offending that he described had occurred. The applicant's forensic disadvantage The trial judge was satisfied that the applicant had experienced a significant forensic disadvantage in being confronted with allegations of criminal offending more than 20 years after the events were said to have occurred. His Honour informed the jury of the nature of the disadvantage and directed them to take it into account when considering the evidence11. His Honour's instruction as to the nature of the disadvantage covered the following considerations: (i) the delay meant that the applicant had lost the opportunity of making inquiries and exploring the alleged circumstances close to the time of the alleged events, which may have uncovered additional evidence throwing doubt on A's allegations or supporting the applicant's denials; (ii) most of the opportunity witnesses could only give evidence of practice or routine whereas, had the trial been held on a date closer to 1996, more might have had specific recall of the subject events; (iii) the effluxion of 20 years or so meant that some witnesses no longer presented the lucid and coherent evidence of younger men; (iv) the Dean of the Cathedral in 1996, whose evidence would have been material on the issue of the applicant's movements following Mass, was in a nursing home and incapable of giving reliable evidence; (v) the passage of time diminished the capacity for the defence to fully test A's evidence; and (vi) B would have been a material witness. The Court of Appeal views the recorded evidence The audio-visual recording of A's evidence at the first trial was admitted at the second trial as if its contents were A's direct testimony under s 379(b)(i) of the Criminal Procedure Act 2009 (Vic). Section 379 makes provision for the admission of the recording of the evidence of a complainant in any appeal from a criminal proceeding that relates to a charge for a sexual offence12. Prior to the hearing in the Court of Appeal, the parties were informed that the Court proposed to watch video-recordings of the trial evidence of four witnesses (A, Portelli, Potter and an altar server, Daniel McGlone), and to attend a view of the Cathedral. In response to this information, the applicant submitted that there was no need for 11 Jury Directions Act 2015 (Vic), s 39. 12 Criminal Procedure Act 2009 (Vic), ss 378(1). Bell Nettle Gordon Edelman members of the Court of Appeal to watch any video-recordings of the witnesses at trial because his case on appeal did not depend upon an assessment of the credibility of any witness. The applicant agreed that the members of the Court should have the benefit of a view of the Cathedral. The applicant also submitted that, if the Court were nevertheless disposed to watch the video-recordings of some witnesses, the Court should also watch the recordings of a number of other named witnesses in order to avoid the risk of "imbalance" or "undue focus". The risk of "imbalance" was adverted to by French CJ, Gummow and Kiefel JJ in SKA v The Queen13. The respondent agreed, both with the course proposed by the Court and with the further suggestions by the applicant. The respondent submitted that watching the video-recordings of the witnesses was "desirable given the existence of the relevant recordings". In this Court, the applicant maintained the position that it was unnecessary and undesirable for the members of the Court of Appeal to have watched the recordings of any of the witnesses. Nevertheless, the applicant was not disposed to contend that the course taken by the Court of Appeal was itself an appealable error. The respondent maintained the position that the existence of the recordings was enough to make it "appropriate" for them to be watched by the Court of Appeal. The position maintained by the respondent is not one that should generally be adopted by courts of criminal appeal. In SKA14, French CJ, Gummow and Kiefel JJ rejected the suggestion that the mere availability of a video-recording of a witness' evidence at trial meant that the proper discharge of the function of the appellate court, to make its independent assessment of the evidence, necessitated a viewing of the recording. There may be cases where there is something particular in the video-recording that is apt to affect an appellate court's assessment of the evidence, which can only be discerned visually or by sound. In such cases, there will be a real forensic purpose to the appellate court's examination of the video- recording. But such cases will be exceptional, and ordinarily it would be expected (2011) 243 CLR 400 at 410-411 [28]-[30]. (2011) 243 CLR 400 at 410-412 [27]-[35]. Bell Nettle Gordon Edelman that the forensic purpose that justifies such a course will be adopted by the parties, rather than upon independent scrutiny by the members of the court15. Secondly, the assessment of the credibility of a witness by the jury on the basis of what it has seen and heard of a witness in the context of the trial is within the province of the jury as representative of the community16. Just as the performance by a court of criminal appeal of its functions does not involve the substitution of trial by an appeal court for trial by a jury, so, generally speaking, the appeal court should not seek to duplicate the function of the jury in its assessment of the credibility of the witnesses where that assessment is dependent upon the evaluation of the witnesses in the witness-box. The jury performs its function on the basis that its decisions are made unanimously, and after the benefit of sharing the jurors' subjective assessments of the witnesses. Judges of courts of criminal appeal do not perform the same function in the same way as the jury, or with the same advantages that the jury brings to the discharge of its function. It should be understood that when the joint reasons in M v The Queen17 spoke of the jury's "advantage in seeing and hearing the witnesses" as being "capable of resolving a doubt experienced by a court of criminal appeal" as to the guilt of the accused, their Honours were not implying that it was only because there were, at that time, no practical means of enabling a court of criminal appeal to see and hear the evidence of the witnesses at trial that the jury's assessment of the credibility of the witnesses was of such potentially critical importance. The assessment of the weight to be accorded to a witness' evidence by reference to the 15 SKA v The Queen (2011) 243 CLR 400 at 410-411 [30]-[31]; see also at 432-433 16 Kingswell v The Queen (1985) 159 CLR 264 at 301 per Deane J; Brown v The Queen (1986) 160 CLR 171 at 201-202 per Deane J; Katsuno v The Queen (1999) 199 CLR 40 at 63-64 [49] per Gaudron, Gummow and Callinan JJ; Cheng v The Queen (2000) 203 CLR 248 at 277-278 [80] per Gaudron J; Alqudsi v The Queen (2016) 258 CLR 203 at 208 [2], 231-232 [58] per French CJ, 273-274 [195] per Nettle and Gordon JJ; R v Baden-Clay (2016) 258 CLR 308 at 329 [65] per French CJ, Kiefel, Bell, Keane (1994) 181 CLR 487 at 494, 495 per Mason CJ, Deane, Dawson and Toohey JJ. Bell Nettle Gordon Edelman manner in which it was given by the witness has always been, and remains, the province of the jury. Rather, their Honours in M were remarking upon the functional or "constitutional" demarcation between the province of the jury and the province of the appellate court. That demarcation has not been superseded by the improvements in technology that have made the video-recording of witnesses possible. The function of the court of criminal appeal in determining a ground that contends that the verdict of the jury is unreasonable or cannot be supported having regard to the evidence18, in a case such as the present, proceeds upon the assumption that the evidence of the complainant was assessed by the jury to be to see whether, credible and reliable. The court examines notwithstanding inconsistencies, that assessment – either by reason of discrepancies, or other inadequacy; or in light of other evidence – the court is satisfied that the jury, acting rationally, ought nonetheless to have entertained a reasonable doubt as to proof of guilt. the record The Court of Appeal's analysis In their joint reasons, the Court of Appeal majority explained that they had approached the determination of the appeal "by trying to put ourselves in the closest possible position to that of the jury"19 by watching the recordings of A's evidence and that of a number of other witnesses, and by reading the transcript and attending a view of the Cathedral. Their Honours concluded, after viewing A's evidence, both before and after the hearing of the appeal, that he was a compelling witness because of the clarity and cogency of his answers and because of the absence of any indication of contrivance in the emotion he conveyed in giving his answers. A impressed their Honours as a witness "who was telling the truth" and whose answers appeared to be "entirely authentic". Their Honours proceeded to consider, in turn, whether each of a number of "solid obstacles" to acceptance of A's account20 was such as to compel the jury to have had a doubt. 18 Criminal Procedure Act 2009 (Vic), s 276(1)(a). 19 Pell v The Queen [2019] VSCA 186 at [33]. 20 Pell v The Queen [2019] VSCA 186 at [23]-[24], [232], citing R v Klamo (2008) 18 VR 644 at 654 [40]. Bell Nettle Gordon Edelman The Court of Appeal majority noted that defence counsel made the submission in his closing address that A's account could not be accepted because "it's impossible basically", there having been no opportunity for the events to have occurred in the way that A described. In their Honours' view, the submission made it incumbent upon the prosecution to seek to negative that the offending was impossible by demonstrating that there was a realistic opportunity for the offending to have occurred. While their Honours acknowledged that there was no onus upon the applicant to prove impossibility, their Honours' analysis proceeded by asking, in relation to each piece of evidence that was inconsistent with A's account, whether it was nonetheless realistically possible that that account was true. As Weinberg JA noted, defence counsel's choice to employ the language of impossibility in his closing address risked setting a forensic hurdle that the defence did not need to overcome. Regardless of counsel's rhetorical flourish, the issue was whether the prosecution had excluded the reasonable possibility that the applicant did not commit the offence/s. At the commencement of their reasons the Court of Appeal majority correctly noted that the approach that an appellate court must take when addressing "the unreasonableness ground" was authoritatively stated in the joint reasons of Mason CJ, Deane, Dawson and Toohey JJ in M. The court must ask itself21: "whether it thinks that upon the whole of the evidence it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty". The Court of Appeal majority went on to note that in Libke v The Queen, Hayne J (with whom Gleeson CJ and Heydon J agreed) elucidated the M test in these terms22: "But the question for an appellate court is whether it was open to the jury to be satisfied of guilt beyond reasonable doubt, which is to say whether the 21 Pell v The Queen [2019] VSCA 186 at [19], citing M v The Queen (1994) 181 CLR 22 Pell v The Queen [2019] VSCA 186 at [21], citing Libke v The Queen (2007) 230 CLR 559 at 596-597 [113]. Bell Nettle Gordon Edelman jury must as distinct from might, have entertained a doubt about the appellant's guilt." (footnote omitted; emphasis in original) As their Honours observed, to say that a jury "must have had a doubt" is another way of saying that it was "not reasonably open" to the jury to be satisfied beyond reasonable doubt of the commission of the offence23. Libke did not depart from M. When it came to applying the M test, their Honours' subjective assessment, that A was a compellingly truthful witness, drove their analysis of the consistency and cogency of his evidence and the capacity of the evidence of the opportunity witnesses to engender a reasonable doubt as to his allegations. Their Honours reasoned, with respect to largely unchallenged evidence that was inconsistent with those allegations (the "solid obstacles" to conviction), that notwithstanding each obstacle it remained possible that A's account was correct. The analysis failed to engage with whether, against this body of evidence, it was reasonably possible that A's account was not correct, such that there was a reasonable doubt as to the applicant's guilt. At the trial and in the Court of Appeal, the applicant relied not only on the evidence of the opportunity witnesses, but also on the content of A's evidence, as giving rise to a doubt as to the truth and reliability of his allegations. It was submitted that A had adapted his evidence in material respects to address matters that had been raised with him for the first time at the committal hearing. These included whether A had changed his account of how the applicant had exposed his penis because of the suggested impossibility of pulling his vestments aside in the way A had first stated. They also included whether A had changed his account of how he and B had re-joined the choir after the assaults. The Court of Appeal majority did not consider that, in any of the respects in which A's evidence at trial varied from his earlier accounts, the variation was such as to have required the jury to entertain a doubt as to the credibility and reliability of his account of the offences. Weinberg JA, in dissent, considered that there was ample material upon which A's account could be subject to legitimate criticism: there were 23 Pell v The Queen [2019] VSCA 186 at [24]. Bell Nettle Gordon Edelman inconsistencies and discrepancies, and a number of his answers "simply made no sense"24. While his Honour accepted that A appeared to have embellished his account at times, he did not find that, had A's evidence stood alone, his allegations in respect of the first incident were fabricated25. His Honour was not prepared to make the same assessment with respect to A's evidence of the second incident. Weinberg JA did not assess A to be such a compelling, credible and reliable witness as to necessarily accept his account beyond reasonable doubt. The division in the Court of Appeal in the assessment of A's credibility may be thought to underscore the highly subjective nature of demeanour-based judgments26. A's evidence unsupported? Despite the fact that the prosecution case was left to the jury as being wholly dependent upon A's evidence, the Court of Appeal majority questioned that A's evidence was uncorroborated. Their Honours suggested that, to an extent, A's evidence was supported by reference to knowledge which he could not have come by unless he was telling the truth. The reference was to A's knowledge of the interior layout of the priests' sacristy, which their Honours found considerably enhanced the credibility of his account. "More striking still", their Honours said, was the fact that A identified the priests' sacristy as the setting of the assaults given that, at all other times, the applicant would have used the archbishop's sacristy. Their Honours said that the jury was entitled to discount the possibility that a tour of the Cathedral, which A may have taken at the time he joined the choir, would explain his detailed knowledge and recollection of the interior of the priests' sacristy 20 years later. So much may be accepted. It does not, however, provide support in the sense of corroboration of A's account27. Satisfaction that A had been 24 Pell v The Queen [2019] VSCA 186 at [455]. 25 Pell v The Queen [2019] VSCA 186 at [928]-[929]. 26 Fox v Percy (2003) 214 CLR 118 at 129 [31] per Gleeson CJ, Gummow and 27 Doney v The Queen (1990) 171 CLR 207 at 211 per Deane, Dawson, Toohey, Gaudron and McHugh JJ; BRS v The Queen (1997) 191 CLR 275 at 283-284 per Brennan CJ; R v Baskerville [1916] 2 KB 658 at 667-668. Bell Nettle Gordon Edelman inside the priests' sacristy did not afford any independent basis for finding that, on such an occasion, he had been sexually assaulted by the applicant. Nor did the circumstance that A identified the priests' sacristy as the setting of the first incident afford independent support for acceptance of his account. A said that the applicant "sort of planted himself in the doorway [of the priests' sacristy]" and challenged the two boys before sexually assaulting them. On any view of the matter, acceptance of A's account involves that the applicant was not acting in accord with his regular practice and that he was an opportunistic sexual predator. A's account would be neither more nor less inherently credible if the archbishop's sacristy had been available for the applicant's use at the time. Defence counsel at the trial relied on a counter-argument with respect to the second incident. A placed this incident as having occurred at a point beyond the doors to the priests' sacristy, but before the door to the archbishop's sacristy. Counsel's submission was, in substance, "why would the applicant have walked beyond the priests' sacristy towards the archbishop's sacristy when it was not in use at the time?" Just as A's evidence that the assaults took place in the priests' sacristy does not enhance the credibility of his account, it might be thought that his evidence that the second incident took place past the entry to the priests' sacristy does not detract from it. There is no requirement that a complainant's evidence be corroborated before a jury may return a verdict of guilty upon it. Nonetheless, it was not correct to assess the capacity of A's evidence to support the verdicts on a view that there was independent support for its acceptance. And it was, with respect, beside the point to find that it was open to the jury to view A's knowledge of the priests' sacristy as independent confirmation of him having been inside it28. The applicant's submissions The applicant submitted that, notwithstanding that the Court of Appeal majority correctly stated the standard and burden of proof, their Honours reversed it by asking whether there existed the reasonable possibility that A's account was correct, rather than whether the prosecution had negatived the reasonable possibility that it was not. On the Court of Appeal majority's findings, the applicant submitted, it was evident that the jury, acting rationally, ought to have entertained 28 Pell v The Queen [2019] VSCA 186 at [97]. Bell Nettle Gordon Edelman a reasonable doubt as to his guilt. The prosecution conceded that the offences alleged in the first incident could not have been committed if, following Mass, the applicant had stood on the Cathedral steps greeting congregants for ten minutes. Their Honours' conclusion that it was reasonably possible that the applicant had not adhered to his practice on the date of the first incident necessarily carried with it acceptance that it was reasonably possible that he had. This conclusion sufficed, in the applicant's submission, to require that his appeal be allowed, and his convictions quashed, in respect of the first four charges. The same logic applied to the offence charged in the second incident: if it was reasonably possible that the applicant was greeting congregants following solemn Mass for not less than ten minutes on 23 February 1997, he could not have been in the corridor outside the sacristies as the choir processed back through the sacristy corridor to the Knox Centre. The applicant's challenge in this Court was not developed by sole reliance on the evidence of his practice of greeting congregants on the Cathedral steps. The focus of his submissions was on the compounding effect of the improbability of events having occurred as A described them in light of unchallenged direct evidence and evidence of practice. The applicant adopted Weinberg JA's analysis of his submission below with respect to the "compounding improbabilities"29. ten claimed compounding His Honour distilled improbabilities30. the applicant's case In this Court, the respondent correctly noted that a number of the claimed improbabilities raise the same point. It remains that acceptance of A's account of the first incident requires finding that: (i) contrary to the applicant's practice, he did not stand on the steps of the Cathedral greeting congregants for ten minutes or longer; (ii) contrary to long-standing church practice, the applicant returned unaccompanied to the priests' sacristy in his ceremonial vestments; (iii) from the time A and B re-entered the Cathedral, to the conclusion of the assaults, an interval of some five to six minutes, no other person entered the priests' sacristy; and (iv) no persons observed, and took action to stop, two robed choristers leaving the procession and going back into the Cathedral. 29 Pell v The Queen [2019] VSCA 186 at [840]-[843], [1060]-[1064]. 30 Pell v The Queen [2019] VSCA 186 at [841]. Bell Nettle Gordon Edelman It suffices to refer to the evidence concerning (i), (ii) and (iii) to demonstrate that, notwithstanding that the jury found A to be a credible and reliable witness, the evidence as a whole was not capable of excluding a reasonable doubt as to the applicant's guilt. (i) The applicant's movements after the Mass Portelli had served the applicant's predecessor, Archbishop Little, as master of ceremonies and he continued in this role following the applicant's installation as Archbishop of Melbourne. Portelli's duties included meeting the applicant when he arrived at the Cathedral for Sunday solemn Mass and escorting him to the priests' sacristy, where he assisted him to put on his vestments. In evidence-in-chief, Portelli explained that, at the conclusion of Sunday solemn Mass, he was beside the applicant as they processed down the centre aisle to the great west door. The applicant always left the procession at the west door and stood on the steps to greet congregants as they were leaving. He handed his mitre to one of the two altar servers who accompanied them, and his crosier to the other. Portelli remained with him. The "meet and greet" could vary from "as little as ten minutes, say up to 15 or nearly 20. It would depend on what else we had to do that afternoon." Portelli disputed that, even on occasions when there was an engagement in the afternoon, the length of the "meet and greet" might be shorter, saying "it wouldn't be much shorter. It wouldn't make sense to stop for any less time than at least - at least six or seven minutes." He was asked: Sure, but was there an occasion or were there occasions, as best you can recall, where the Archbishop might depart from that practice and speak for a short period of time before returning to the sacristy? He may have done so on occasion, yes. Q. When I say short period of time, I'm speaking of just a couple of minutes? Yes, I suppose that's possible but I don't really recall it, but it's possible." In cross-examination, Portelli agreed that the two occasions in December when the applicant celebrated Sunday solemn Mass were memorable; there were a large number of congregants who wished to meet the applicant. The applicant remained on the steps of the Cathedral greeting people for at least ten minutes on Bell Nettle Gordon Edelman each occasion. Portelli recalled that, at the conclusion of the "meet and greet" on each occasion, he accompanied the applicant to the priests' sacristy and assisted him to remove his vestments. In examination-in-chief, the prosecutor had obtained Portelli's acknowledgement that he did not remember whether there was an internal or external procession on 15 and 22 December 1996. In re-examination, Portelli further acknowledged that he did not remember where he and the applicant went after leaving the Cathedral. Portelli's evidence of the fact and the length of the "meet and greet" on 15 and 22 December 1996, and of accompanying the applicant to the priests' sacristy thereafter on each occasion, was unchallenged. Potter served as the Cathedral's sacristan for 38 years. He was aged 84 years at the date of the trial and he appears to have been suffering from some mental infirmity. At times, his recollection of events was apparently flawed. Potter gave evidence that the west door of the Cathedral was closed during the Mass. It was Potter's responsibility to open it for the procession or to have "one of [his] men" do so. Potter recalled the applicant's practice of greeting congregants on the steps of the Cathedral following Sunday solemn Mass. He estimated that this might take 20 minutes or half an hour. Potter maintained that he had an actual recollection of the applicant standing on the front steps of the Cathedral in 1996 at the time he first started saying Mass as Archbishop of Melbourne. When asked if it was possible that the applicant had stayed on the steps for a shorter period of time, Potter responded, "[i]t depends what function he was attending afterwards". The evidence suggested that the applicant did not have functions to attend on the afternoons of 15 and 22 December 1996. The prosecutor pressed Potter as to whether it was possible that the applicant had remained on the front steps speaking with congregants "for a very short period of time", to which Potter responded, "not the first time when he was the archbishop, it took him a while to adjust, and [he] stayed in there welcoming people for a couple of months in the cathedral". Potter agreed that it was possible that on occasions the applicant greeted congregants for a period of ten or 15 minutes rather than the 20 to 30 minutes that he had initially stated. He could not recall the applicant spending "just a short time" in this activity unless the weather was inclement. Potter disputed that on any occasion the applicant had returned to the sacristy unaccompanied; "[i]f Father Portelli wasn't there, he would let me know. I would go down and greet the Archbishop to bring him back in." Daniel McGlone was an altar server at the Cathedral in 1996. He was able to recall only one occasion when he served at a Sunday solemn Mass celebrated Bell Nettle Gordon Edelman by the applicant. The occasion stuck in his memory because it was the first time that the applicant celebrated Sunday solemn Mass at the Cathedral, and his mother had made a rare visit to the Cathedral that day so that they could lunch together afterwards. At the conclusion of the Mass, McGlone walked with his mother to the west door, where the applicant was "doing the meet and greet". McGlone introduced his mother to the applicant, who said, "[y]ou must be very proud of your son". Mrs McGlone responded, "I don't know about that". McGlone recalled the occasion as taking place between October and December 1996. He believed that it was the first time that the applicant had celebrated Sunday solemn Mass in the Cathedral, although he allowed that it might not have been. It was McGlone's impression that the applicant was drawing a deliberate contrast between his administration and that of his predecessor, Archbishop Little, by adopting the practice of greeting congregants after Mass. Jeffrey Connor was an altar server in 1996. He ceased these duties in November 1997. Connor's personal diary entries recorded that he served at the solemn Masses on 15 and 22 December 1996. He did not have a specific recall of the services on those dates but said it was the applicant's "invariable" practice to greet congregants on the steps of the Cathedral after Mass. He recalled that the applicant would take off his mitre and hand it to one altar server and hand his crosier to the other. The altar servers would take them and join the procession at its rear. Connor had served on occasions as the applicant's mitre or crosier bearer. He said the applicant would return to the sacristy more than ten minutes after the procession. Peter Finnigan, the Cathedral choir marshal in 1996, recalled both Sunday solemn Masses celebrated by the applicant in December of that year. In his role as choir marshal, he was near the back of the procession as it left the Cathedral. Once it rounded the side of the Cathedral he moved up until he reached the front of it by the time the choristers were entering the toilet corridor. Finnigan was asked what the applicant was doing as the procession moved along. It was his understanding that the applicant would usually stand on the steps of the west door and greet parishioners for "something like" ten minutes. A number of men who were choirboys in 1996 gave evidence of the conduct of external processions following Sunday solemn Mass. Two of them recalled that on occasions the applicant processed back to the Cathedral with the choir. Anthony Bell Nettle Gordon Edelman Nathan was asked if he ever saw the applicant "pause at the steps at the front entrance and not process out with you" and he said: "I've got memories of both. I think there may have been times where he um, stayed at the front of the steps and spoke to the congregation, and there's also times that I remember walking all the way around." Nathan was asked where the applicant would be at the time of the procession and he explained "so if he was in front of us, it was - by the time we go to that circular pool and then I wouldn't see him after that. Wouldn't really pay attention to where he was after that." The reference to the circular pool, it appears, was to a pool in the Cathedral's garden, which the procession passed by as it made its way back to the metal gate at the rear of the Cathedral. Luciano Parissi was a member of the choir between 1991 and 2001. Parissi was not able to say where the applicant was during the external procession following Sunday solemn Mass because "[h]e'd always be behind me. I would never really be looking back." Parissi recalled that the applicant remained with the procession and that usually the choir would stop and wait for him to enter the back of the Cathedral first. Parissi did not have any specific recollection of Sunday solemn Masses in the second half of 1996. Parissi's membership of the choir spanned the administration of three archbishops. In cross-examination he was asked if it was possible that it was not the applicant for whom the choir stopped at the end of the external procession. He said that to the best of his recollection there "would be times when that would happen with [the applicant] ... I can't recall definitively because I was there for a while, and sometimes those do blur into different priests and archbishops, yes." Andrew La Greca was aged 13 years in 1996. He had commenced singing with the choir in 1993. He had no recall of Masses or processions in December 1996. His recollection was that it was more common for the processions to proceed internally. He understood that whether the procession was external or internal depended upon the identity of the celebrant. Archbishop Little had a preference for external processions. External processions were also frequent when the applicant was the celebrant. La Greca recalled that as the external procession rounded the corner of the Cathedral sometimes the applicant "would just wait and speak to the congregation" and "[o]ther times he might have just kept on walking with us. I can't recall exactly." Bell Nettle Gordon Edelman In cross-examination, La Greca agreed that the procession did not make a tight left turn around the Cathedral, it moved in an arc, and it was possible to look back and see congregants coming out of the Cathedral. He agreed he had seen the applicant greeting the congregants. Rodney Dearing was an adult member of the choir in 1996. It was his evidence that, after Mass, the applicant and Portelli would generally stay at the west door. He did not purport to have a specific recall of the solemn Mass on 15 or 22 December 1996. His evidence was of the applicant's general practice. Dearing was not aware of any occasion when the applicant had departed from the practice, although he acknowledged that, once the procession left the Cathedral, he had not had the applicant "under observation". He recalled occasions when, after returning to the choir room and removing his chorister's robes, he had gone back around to the west door and said hello to the applicant. This had happened reasonably often. Rodney Dearing's son, David, was a member of the choir in 1996. He was aged about 13 at that time. He recalled seeing the applicant stopping on the steps of the Cathedral after solemn Mass. He also recalled, on occasion, coming back through the Cathedral after he had changed out of his choir robes and seeing the applicant still on the main steps. He estimated that this would have been ten or 15 minutes after the end of Mass. (ii) The applicant was always accompanied within the Cathedral Portelli explained that the master of ceremonies is a church office with a long history. The duties of the master of ceremonies are set out in learned works which themselves date back some centuries. The teaching in these texts requires that an archbishop not be unaccompanied from the moment the archbishop enters a church. This evidence of Catholic church practice was unchallenged. Portelli's duties included accompanying the applicant back to the sacristy following Sunday solemn Mass and assisting him to remove his vestments. Portelli acknowledged that it was possible that there was an occasion when he did not return to the sacristy with the applicant although he had no recall of this happening and in such a case he would have made sure that the applicant was accompanied by Potter or a priest. Portelli also pointed out that he, too, needed to change out of his robes following the Mass. Portelli was able to recall the two occasions on which he had not acted as master of ceremonies for the applicant at Sunday solemn Mass Bell Nettle Gordon Edelman in the Cathedral: in June 1997 he was overseas, and in October 2000 he underwent surgery. Apart from these two instances, Portelli had no recall of any occasion when he did not accompany the applicant to the sacristy to disrobe. He acknowledged the possibility of an occasion or occasions when, after escorting the applicant to the sacristy, he may have left him while he, Portelli, went back to the sanctuary to make sure that everything was in place if there was another service that afternoon. In that event, he would have been absent for around two minutes. He was able to say that he would not have left the applicant to check that everything was in place in the sanctuary on either 15 or 22 December 1996 because there were no other events fixed for those afternoons. Potter confirmed that the applicant would never return to the sacristy unaccompanied. It was Potter's responsibility to assist the applicant with the removal of his vestments and to make sure that the vestments were hung. Potter maintained there was always a priest to assist the applicant or "one of us", a reference it would seem to either Portelli or himself being present in the sacristy when the applicant removed his vestments. Potter agreed that, on the first two occasions on which the applicant said Sunday solemn Mass in the Cathedral, the applicant was assisted to disrobe by Portelli. McGlone's understanding was that an archbishop could never be left alone in the Cathedral, at least not during the course of ceremonies, and that the ceremony continued until the archbishop removed his vestments. McGlone explained that the vestments themselves are sacred, and that particular prayers are said when donning and removing them. Connor had no recall of ever seeing the applicant alone while he was robed. He agreed that such an occasion would have been memorable. David Dearing was asked if he had ever seen the applicant in robes without Portelli accompanying him. He replied, "I wouldn't have thought so, no. My recollection is that they were always together." He was asked to describe the distance between the two when they were walking together. His response was to say, "I described him as his bodyguard". His father, Rodney Dearing, agreed that whenever he saw the applicant robed, he was with Portelli. Bell Nettle Gordon Edelman (iii) The timing of the assaults and the "hive of activity" Potter was responsible for the security of the sacristies and he had the key to the priests' sacristy, which was locked during Mass. Potter's evidence about when he unlocked it was unclear. Initially he said that he did so as the procession was making its way down the centre aisle while the recessional hymn was being played. Potter went on to explain that, at the conclusion of the Mass, some congregants would walk up to the sanctuary area and kneel to pray. He allowed them some five or six minutes of "private time" for prayer before he commenced removing the sacred vessels and other items from the sanctuary. Later in the course of examination-in-chief, Potter said that he did not unlock the priests' sacristy doors until after the five or six minutes of private prayer time. The altar servers, Connor and McGlone, gave evidence that, at the conclusion of the procession, they went into the priests' sacristy and each bowed to the crucifix. McGlone explained that the formal procession following the celebration of solemn Mass is only complete for the altar servers when they enter the priests' sacristy in formation and bow to the crucifix in turn. Connor recalled that usually Potter was waiting for them and he unlocked the doors. McGlone recalled that sometimes the door from the vestibule opening into the sacristy corridor was locked and "usually [Potter] would appear out of nowhere and unlock it. Most times though it was unlocked when we were processing there." He recalled that the doors to the priests' sacristy were unlocked. The altar servers assisted Potter in clearing the sanctuary. This took around ten minutes to a quarter of an hour. The chalices, ciboriums, cruet sets, tabernacle key and missals were all returned to the priests' sacristy. The candles (there were seven of them when the applicant celebrated Mass) and the thurible were returned to the utility room. The vessels and other items were carried one at a time. During this exercise people were continually coming into and going out of the priests' Neither Connor nor McGlone could recall any occasion on which the sacristy had been left unlocked and unattended. In Connor's experience, that never happened. Dr Cox, the assistant organist, described the priests' sacristy as a "hive of activity" after Mass. The choir marshal, Finnigan, recalled that after Mass there were "people everywhere" in the sacristy corridor, with people "coming in and going out", including altar servers bringing implements into the priests' sacristy. He said that there were almost always a number of other priests acting as concelebrants who would vest and de-vest in the priests' sacristy. They would Bell Nettle Gordon Edelman come in after Mass had finished and remain for the next ten to 15 minutes or so. McGlone likened it to the green room in an opera house, explaining that it was where the sacred vessels were taken, and that the servers "are moving back and forth into that room". Consideration – (i) the applicant's movements after Mass and (ii) the applicant always accompanied The Court of Appeal majority dealt with the evidence of the applicant greeting congregants on the Cathedral steps, observing31: "But, on the critical issue of whether [the applicant] stood on the steps of the Cathedral on the day of the first or second Mass, and if so for how long, the recollection of the opportunity witnesses must necessarily be affected by their recollection of the ritual that developed thereafter." Notwithstanding that Portelli's evidence of having an actual recall of being present beside the applicant on the steps of the Cathedral as the applicant greeted congregants on 15 and 22 December 1996 was unchallenged, the Court of Appeal majority said it was open to the jury to have reservations about the reliability of his affirmative answers given in cross-examination. The Court of Appeal majority also considered that it was open to have reservations about the reliability of this evidence given the improbability of Portelli having a specific recollection of particular Masses in the absence of "some significant and unusual event" having occurred at one or other of them. Their Honours observed that, while Portelli may have had a general recollection of the first time the applicant said Sunday solemn Mass at the Cathedral, he had demonstrated a lack of detailed recall of the events of that day. The suggestion that witnesses' memories may have been affected by the ritual that developed thereafter has echoes of the prosecutor's closing submission, which was that the applicant's practice of greeting congregants may not have developed before 1997. It is a contention that finds no support in the evidence and was not pursued by the respondent on appeal to this Court. It will be recalled that Finnigan's understanding was that the applicant stood on the steps greeting congregants for "something like" ten minutes as the procession, with him towards the rear, made its way around the side of the Cathedral. His understanding in this 31 Pell v The Queen [2019] VSCA 186 at [161]. Bell Nettle Gordon Edelman respect was of Masses celebrated by the applicant in 1996, since Finnigan last acted as choir marshal on Christmas day of that year. The occasion when McGlone's mother was introduced to the applicant on the Cathedral steps after Sunday solemn Mass was in December 1996, as McGlone did not believe that he continued as an altar server after the end of 1996. The Court of Appeal majority observed that the encounter between McGlone's mother and the applicant was not in doubt but that there was some uncertainty about the date of its occurrence. McGlone was confident that this was the first time the applicant had said Mass in the Cathedral, but their Honours observed that McGlone had been mistaken in his belief that he had not attended the evening Mass celebrated by the applicant on 23 November 1996. Moreover, their Honours said that, accepting the encounter occurred on either 15 or 22 December 1996, it did not make the occurrence of the first incident impossible. It simply ruled out one of those two Sundays as the date of its occurrence32. The Court of Appeal majority's treatment of what their Honours rightly identified as the critical issue in the case33 was wrong for two reasons. First, Portelli's evidence was unchallenged. Secondly, their Honours were required to reason in a manner that is consistent with the way in which a jury would be directed in accordance with the Jury Directions Act 2015 (Vic)34. Their Honours were required to take into account the forensic disadvantage experienced by the applicant arising from the delay of some 20 years in being confronted by these allegations35. Their Honours, however, reasoned to satisfaction of the applicant's guilt by discounting a body of evidence that raised lively doubts as to the commission of the offences because they considered the likelihood that the memories of honest witnesses might have been affected by delay. The Court of Appeal majority acknowledged that there was general consistency and "substantial mutual support", in the account of the opportunity 32 Pell v The Queen [2019] VSCA 186 at [271]-[272]. 33 Pell v The Queen [2019] VSCA 186 at [161]. 34 Jury Directions Act 2015 (Vic), ss 4A, 39. 35 Jury Directions Act 2015 (Vic), s 39(3)(a). Bell Nettle Gordon Edelman witnesses, as to what occurred after Sunday solemn Mass in the period when the applicant was archbishop. And, as their Honours also acknowledged, a defining feature of religious observance is adherence to ritual and compliance with established practice36. However, their Honours again discounted this body of "[A]ttempting to recall particular events is all the more difficult when the events being described are – as they were here – of a kind which was repeated week after week, year after year, and involved the same participants, in the same setting, performing the same rituals and following the same routines." Evidence of a person's habit or practice of acting in a particular way to establish that the person acted in that way on a specific occasion may have considerable probative value. As Professor Wigmore explained, "[e]very day's experience and reasoning make it clear enough"38. The evidence of religious ritual and practice in this case had particular probative value for the reason that their Honours first identified: adherence to ritual and compliance with established liturgical practice is a defining feature of religious observance. Contrary to the Court of Appeal majority's analysis, the absence of any "significant and unusual event" associated with solemn Mass on 15 and 22 December 1996 tells against the likelihood of Portelli having departed from his duties as master of ceremonies. The Court of Appeal majority took into account the evidence of four witnesses in concluding not only that it was possible that the applicant was alone and robed in contravention of centuries-old church law, but that the evidence of witnesses to the contrary did not raise a reasonable doubt as to the applicant's guilt39. 36 Pell v The Queen [2019] VSCA 186 at [159]. 37 Pell v The Queen [2019] VSCA 186 at [160]. 38 Wigmore, Evidence in Trials at Common Law, Tillers rev (1983), vol 1A, §92 at 1607. See also Cross on Evidence, 9th Aust ed (2013) at 19-20 [1135]. 39 Pell v The Queen [2019] VSCA 186 at [287]-[291]. Bell Nettle Gordon Edelman The evidence to which their Honours referred was that of three choirboys – Robert Bonomy, David Mayes and Nathan – and that of the organist and choirmaster, John Mallinson. Bonomy said that he had seen the applicant robed in the sacristy corridor and sometimes the applicant was with others and sometimes he was on his own. Bonomy had been lined up with the choir in the sacristy corridor waiting to process into Mass when he made these observations. Their Honours noted that Nathan and Mayes recalled the applicant coming into the choir room after Mass and that "[v]ery infrequently, Nathan said, [the applicant] would be robed"40. Nathan had a recollection of the applicant popping into the choir room to congratulate the choir on a good performance or a great Mass. He could not remember whether the applicant was alone or with someone else, nor whether he was robed. The occasion does not appear to have been further identified. Mayes' evidence, to which their Honours referred, was his memory of the applicant coming into the choir room "in the first five minutes while everybody was still there". When asked if the applicant was robed, he replied that it was "very rare to see him unrobed. Yeah, he would have been robed." Mayes could not say whether the applicant was accompanied or not on this occasion. Mayes agreed that there were infrequent special functions for the choir to which parents were invited at which the applicant would be introduced to the parents. He was unable to say whether the applicant was robed on these occasions. Mayes recalled leaving the Cathedral after Sunday solemn Mass and seeing the applicant on the Cathedral steps shaking hands or talking to congregants. He agreed that this would have been 15 minutes or more after Mass had finished. The Court of Appeal majority noted Mallinson's evidence of probably having seen the applicant in the sacristy corridor many times. Their Honours extracted the following exchange concerning that evidence: "Q. And again, was he on his own or with anyone? Sometimes he was with somebody and sometimes he would be on his own. 40 Pell v The Queen [2019] VSCA 186 at [290]. Bell Nettle Gordon Edelman Q. Would he be robed or unrobed? I've seen him both ways. For instance, after he'd gone to the sacristy and disrobed and he'd be in his normal clerical garb." It is by no means evident that Mallinson was departing from his evidence that, on the occasions when Mallinson saw the applicant in his robes, Portelli was always with him. It may be observed that Mallinson acknowledged that the applicant was a stickler for protocol and conservative in terms of church liturgy and tradition. The honesty of the opportunity witnesses was not in question. Portelli and Potter each gave evidence that Portelli accompanied the applicant to the priests' sacristy after solemn Mass on 15 and 22 December 1996. There appears to have been agreement that, in light of Potter's apparent infirmity, notwithstanding the grant of leave to cross-examine him, the prosecutor was not required to comply with the rule in Browne v Dunn41. This understanding did not apply to Portelli. Portelli's evidence in this respect was unchallenged. So, too, was the evidence that Catholic church teaching requires an archbishop to be accompanied while in a church, at least while the archbishop is robed, unchallenged. And the evidence that it was Portelli's role as the applicant's master of ceremonies to ensure that this requirement was complied with was unchallenged. Whatever is made of Nathan's and Mayes' evidence of the applicant coming into the choir room in the Knox Centre, it was not evidence of the applicant being unaccompanied while robed in the Cathedral. Bonomy's evidence is a slim foundation for finding that the practice of ensuring that the applicant was accompanied while he was in the Cathedral was not adhered to. It provides no foundation for excluding the reasonable possibility that Portelli's actual recall of accompanying the applicant to the priests' sacristy after solemn Mass on 15 and 22 December 1996 was accurate. There was a powerful body of evidence of the applicant's practice of greeting congregants on the Cathedral steps following Sunday solemn Mass and that, while the length of this "meet and greet" varied, it occupied at least ten minutes. The applicant's practice in this respect contrasted with that of his predecessor, Archbishop Little. Portelli served as master of ceremonies for both Bell Nettle Gordon Edelman and it might be thought unremarkable that he should recall that on the first and second occasions on which the applicant, as the new Archbishop of Melbourne, celebrated Sunday solemn Mass in the Cathedral, he had greeted congregants as they left after the service. The respondent's reliance in this Court on the two choirboys' evidence, that sometimes the applicant processed back to the Cathedral with the choir, is no answer to Portelli's evidence concerning the solemn Masses on 15 and 22 December 1996. Moreover, their evidence hardly calls into question the evidence of the opportunity witnesses of the applicant's practice of greeting congregants after Mass. Nathan's recollection was that, on the occasions that the applicant processed out of and around the side of the Cathedral, the applicant was in front of him. There does not appear to have been any question in the evidence of the other witnesses that when the applicant took part in the procession, as it entered the Cathedral or as it made its way down the centre aisle at the conclusion of the Mass, as the most senior of the participants, he was at its end. Parissi accepted that his memory of standing back to allow the applicant to re-enter the Cathedral complex might be wrong, as his memory of archbishops and priests tended to blur. Parissi was a chorister when Archbishop Little celebrated Mass and, as noted, Archbishop Little did not leave the procession to greet congregants. (iii) Consideration – the timing of the assaults and the "hive of activity" As the Court of Appeal majority observed, the effect of the altar servers' evidence was that the unlocking of the priests' sacristy doors, and the bowing to the crucifix, occurred soon after the procession finished42. By the time the procession returned, and the altar servers reached the door giving access to the eastern end of the sacristy corridor, the doors to the priests' sacristy were unlocked. It will be recalled that it was A's account that he and B broke away from the procession at a point at which the choristers were congregated outside the metal gate which gave access to the toilet corridor. A and B made their way back into the Cathedral through the south transept door and from there through the double 42 Pell v The Queen [2019] VSCA 186 at [296]. Bell Nettle Gordon Edelman doors which opened from the south transept into the western end of the sacristy corridor. The Court of Appeal majority concluded that it was "quite possible" for the priests' sacristy to have been unlocked and that A and B might have entered the priests' sacristy after the altar servers had bowed to the crucifix43. Their Honours further concluded that it was open to the jury to find that the assaults took place in the five to six minutes of private prayer time, before the "hive of activity" in the priests' sacristy, including the clearing of the sanctuary by the altar servers, commenced44. The possibility for which their Honours allowed is not without difficulty. A, a soprano, was close to the front of the procession. If A and B broke away from it and re-entered the Cathedral through the door of the south transept and went through the double doors into the western end of the sacristy corridor, it might reasonably be expected that they would have encountered the altar servers. The altar servers were at the front of the procession. There were at least six of them and there may have been as many as 12. Those in the front of the procession waited for the two servers bookending it at the rear and then they bowed in order to the crucifix. A further oddity is that A and B did not encounter any concelebrant priests in the sacristy corridor or the priests' sacristy, notwithstanding that concelebrant priests would be expected to have gone into the priests' sacristy to disrobe after the procession broke up. It was Finnigan's evidence that there were other priests concelebrating solemn Mass on 15 and 22 December 1996. The principal difficulty with the Court of Appeal majority's analysis is that it elides Potter's estimate of five to six minutes of private prayer time with the estimate of five to six minutes during which A and B re-entered the Cathedral, made their way into the priests' sacristy and were assaulted. The two periods are distinct. The private prayer time commenced shortly after the conclusion of the Mass. Mallinson, the organist and choirmaster, referred to it as an "interval" of 43 Pell v The Queen [2019] VSCA 186 at [296]. 44 Pell v The Queen [2019] VSCA 186 at [296], [300]. Bell Nettle Gordon Edelman "decorum". He was asked when Potter would commence clearing the sanctuary after Mass, and he replied: "Well, it's difficult to define. Perhaps the clergy having left the sanctuary half a minute, a minute, perhaps a minute and a half, two minutes. It's difficult to say. I mean it depends on the circumstances, how many people are in the cathedral, but fairly soon after the clergy have left the sanctuary." The procession, of which A and B formed a part, was making its way down the central aisle of the Cathedral during the private prayer time. The procession processed with a degree of formality because it was a religious procession and its members were on display to the public. Assuming that private prayer time occupied five or six minutes, and not the lesser time that Mallinson recalled, it remains that, by the time the altar servers entered the sacristy corridor at the conclusion of the external procession, the private prayer time had been running for some minutes. The Court of Appeal majority's conclusion that it was possible that the assaults occurred after the altar servers had bowed to the crucifix in the priests' sacristy and before they commenced to clear the sanctuary invites the question "where were the altar servers during the five- to six-minute hiatus that their Honours hypothesised?" Although the timing of these events cannot be fixed with any precision, it was, as noted, plainly not the case that the private prayer time given to congregants, before items from the sanctuary were cleared to the priests' sacristy, did not commence until the front of the procession was close to the metal gate. It was not in issue that the altar servers entered the priests' sacristy and bowed to the crucifix at the conclusion of the procession or that they assisted Potter to clear the sanctuary. In closing submissions, the prosecutor invited the jury to find that, after bowing to the crucifix, the altar servers went to the "workers' sacristy" and waited for Potter to give them "the green light" to start clearing up. There was no evidentiary support for that submission and, following objection, the prosecutor withdrew it. In this Court, the respondent maintained that the assaults occurred after the altar servers had entered the priests' sacristy and bowed to the crucifix and before the "hive of activity" in the sacristy commenced. The respondent, relying on Mallinson's evidence, sought to lengthen the private prayer time, submitting that "[p]recisely when this interval would end would, of course, depend on the Bell Nettle Gordon Edelman circumstances including how many people were in the Cathedral". The submission overlooked that, on Mallinson's account, circumstances such as how many people were in the Cathedral would only account for the private prayer time allowed prior to the clearing of the sanctuary varying from 30 seconds to two minutes. The respondent also submitted that "[t]he altar servers would have then left the Sacristy – either for the workers' room, where they disrobed, or for the sanctuary to assist Potter". The submission comes close to repeating the submission which the prosecutor withdrew at the trial. There was no evidence that the altar servers went to their room to disrobe prior to returning to the sanctuary in order to assist in clearing away the sacred vessels and other objects. Nor is there an evidentiary foundation for the conclusion that there was a hiatus between the time when the altar servers completed their bows to the crucifix and the clearing of the sanctuary. Conclusion It may be accepted that the Court of Appeal majority did not err in holding that A's evidence of the first incident did not contain discrepancies, or display inadequacies, of such a character as to require the jury to have entertained a doubt as to guilt. The likelihood of two choirboys in their gowns being able to slip away from the procession without detection; of finding altar wine in an unlocked cupboard; and of the applicant being able to manoeuvre his vestments to expose his penis are considerations that may be put to one side. It remains that the evidence of witnesses, whose honesty was not in question, (i) placed the applicant on the steps of the Cathedral for at least ten minutes after Mass on 15 and 22 December 1996; (ii) placed him in the company of Portelli when he returned to the priests' sacristy to remove his vestments; and (iii) described continuous traffic into and out of the priests' sacristy for ten to 15 minutes after the altar servers completed their bows to the crucifix. Upon the assumption that the jury assessed A's evidence as thoroughly credible and reliable, the issue for the Court of Appeal was whether the compounding improbabilities caused by the unchallenged evidence summarised in (i), (ii) and (iii) above nonetheless required the jury, acting rationally, to have entertained a doubt as to the applicant's guilt. Plainly they did. Making full allowance for the advantages enjoyed by the jury, there is a significant possibility in relation to charges one to four that an innocent person has been convicted. Bell Nettle Gordon Edelman The second incident It will be recalled that the second incident is alleged to have occurred after Sunday solemn Mass on an occasion on which there was an internal procession through the sacristy corridor. A agreed that he, as one of the younger boys, would have been towards the front of the procession as it made its way through the sacristy corridor, with the older choristers, including some adults, behind him. They were all rushing to get back to the choir's robing room when the second incident occurred. The applicant appeared and shoved A against the wall and squeezed his genitals, causing pain, although he did not know if he had called out. The defence contended at trial that the notion that the applicant – a tall, imposing figure in his archbishop's robes – might assault a young choirboy in the presence of a number of choristers, including several adults, bordered on the fanciful. The Court of Appeal majority accepted that the sight of the applicant at close quarters with a choirboy might well have attracted attention. However, their Honours reasoned that the others in the corridor were intent on completing the procession and removing their robes as soon as possible. In this state of affairs, their Honours assessed that it was quite possible that the brief encounter went unnoticed. At all events, their Honours said, "the evidence once again falls well short of establishing impossibility". Weinberg JA considered that, had the second incident occurred in the way A described it, it was highly unlikely that none of the many persons present would have seen what was happening or reported it in some way. His Honour concluded that it was not open to the jury to be satisfied beyond reasonable doubt of the applicant's guilt of the offence charged in the second incident. The assumption that a group of choristers, including adults, might have been so preoccupied with making their way to the robing room as to fail to notice the extraordinary sight of the Archbishop of Melbourne dressed "in his full regalia" advancing through the procession and pinning a 13 year old boy to the wall, is a large one. The failure to make any formal report of such an incident, had it occurred, may be another matter. It is unnecessary to decide whether A's description of the second incident so strains credulity as to necessitate that the jury, who saw and heard him give the evidence, ought to have entertained a reasonable doubt as to its occurrence. The Bell Nettle Gordon Edelman capacity of the evidence to support the verdict on this charge suffers from the same deficiency as the evidence of the assaults involved in the first incident. Portelli gave unchallenged evidence of his recall of being with the applicant at solemn Mass on 23 February 1997. Portelli recalled that this was an unusual occasion because Father Egan was the celebrant. The protocol remained that the applicant as the most senior person was last as the procession processed down the centre aisle of the Cathedral. The unchallenged evidence of the applicant's invariable practice of greeting congregants after Sunday solemn Mass, and the unchallenged evidence of the requirement under Catholic church practice that the applicant always be accompanied when in the Cathedral, were inconsistent with acceptance of A's evidence of the second incident. It was evidence which ought to have caused the jury, acting rationally, to entertain a doubt as to the applicant's guilt of the offence charged in the second incident. In relation to charge five, again making full allowance for the jury's advantage, there is a significant possibility that an innocent person has been convicted. This conclusion makes it unnecessary to consider whether the respondent's concession, that if the verdicts in relation to the offences charged in the first incident are unreasonable or cannot be supported by the evidence then it follows that the same conclusion should be reached in relation to the verdict concerning the offence charged in the second incident, amounts to a mode of reasoning that contravenes ss 44F and 44G of the Jury Directions Act. Orders For these reasons, there should be the following orders: Special leave to appeal granted. Appeal treated as instituted and heard instanter and allowed. Set aside order 2 of the orders of the Court of Appeal of the Supreme Court of Victoria made on 21 August 2019 and, in its place, order that: the appeal be allowed; and Bell Nettle Gordon Edelman the appellant's convictions be quashed and judgments of acquittal be entered in their place.
HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Putland v The Queen [2004] HCA 8 12 February 2004 ORDER Appeal dismissed. On appeal from the Supreme Court of the Northern Territory Representation: D Grace QC with R R Goldflam for the appellant (instructed by Northern Territory Legal Aid Commission) D J Bugg QC with G C Fisher for the respondent (instructed by Commonwealth Director of Public Prosecutions) Intervener: D M J Bennett QC, Solicitor-General of the Commonwealth, with A R Beech intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Putland v The Queen Criminal law – Sentencing – Offences against laws of the Commonwealth – Where offender tried in Territory court for indictable offences against laws of the Commonwealth – Judiciary Act 1903 (Cth), s 68(1) – Where Territory legislation permitted aggregate sentences for indictable offences – Whether aggregate sentences were permissible in the case of Commonwealth offences. Constitutional law – Discrimination – Whether Territory legislation permitting aggregate sentencing resulted in constitutionally impermissible discrimination between federal offenders. Words and phrases – "so far as they are applicable". Crimes Act 1914 (Cth), s 4K, Pt 1B. Judiciary Act 1903 (Cth), s 68. Sentencing Act (NT), s 52. GLEESON CJ. The appellant was charged in the Supreme Court of the Northern Territory with offences against the Crimes Act 1914 (Cth) ("the Crimes Act") and offences against the Bankruptcy Act 1966 (Cth). All were indictable offences. The Supreme Court was exercising federal jurisdiction. The appellant pleaded guilty. Pursuant to Northern Territory legislation referred to below, the sentencing judge imposed a single, aggregate sentence of imprisonment for four years, and ordered that the appellant be released after serving 12 months upon entering into a bond to be of good behaviour for three years. The appellant appealed against the sentence to the Northern Territory Court of Criminal Appeal. Most of the grounds of appeal are presently immaterial. The appeal was dismissed. The one ground of appeal pursued in this Court is that the sentencing judge did not have power to impose an aggregate term of imprisonment. The Court of Criminal Appeal (Martin CJ, Mildren and Riley JJ) held that, by operation of s 68 of the Judiciary Act 1903 (Cth) ("the Judiciary Act"), the law of the Northern Territory permitting an aggregate sentence applied, and that the sentencing judge had the power he purported to exercise. In this respect, the Court of Criminal Appeal followed an earlier decision of the South Australian Court of Criminal Appeal, R v Jackson1. South Australia also has legislation which permits aggregate sentences in the case of indictable offences. The legislation The Sentencing Act (NT) ("the Sentencing Act") provides: Where an offender is found guilty of 2 or more offences joined in the same information, complaint or indictment, the court may impose one term of imprisonment in respect of both or all of those offences but the term of imprisonment shall not exceed the maximum term of imprisonment that could be imposed if a separate term were imposed in respect of each offence." (emphasis added) Sub-sections (2) and (3) impose presently irrelevant qualifications on the power given by s 52. The principles according to which such a statutory power is to be exercised, and their relationship with the sentencing principle of totality, were considered by the South Australian Court of Criminal Appeal in the case of Major2. Since we are not concerned with any issue as to the severity of the sentence in the present case, it is unnecessary to pursue that topic. Section 68 of the Judiciary Act provides, so far as presently relevant, that the laws of a State or Territory respecting the arrest and custody of offenders or (1998) 72 SASR 490. (1998) 100 A Crim R 66. persons charged with offences, and the procedure for their trial and conviction on indictment, shall apply and be applied so far as they are applicable to persons who are charged with offences against the laws of the Commonwealth in respect of whom jurisdiction is conferred on the several courts of that State or Territory by the section. The operation of related provisions of s 68 concerning appeals was recently considered by this Court in The Queen v Gee3. The background to the section is the obvious circumstance that State and Territory laws concerning the matters to which the section relates may differ. The necessary consequence is that, in certain respects, those differences will apply as between federal offenders, depending upon where they are tried. In the present case, the sentencing judge was exercising jurisdiction conferred by s 68(2). Northern Territory laws respecting the procedure for trial and conviction on indictment were at least potentially picked up and applied as federal law by s 68(1). Sentencing laws come within that description4. In Leeth v The Commonwealth5, Mason CJ, Dawson and McHugh JJ referred to an observation by Dixon J6 that s 68 disclosed a policy "to place the administration of the criminal law of the Commonwealth in each State upon the same footing as that of the State" and that it was "no objection to the validity of such a provision that the State law adopted varies in the different States". They continued: "Thus the administration of the criminal law of the Commonwealth is organized upon a State by State basis and there may be significant differences in the procedures applying to the trial of a person charged with an offence against a Commonwealth law according to the State in which he is tried. And if a person is convicted of a federal offence and sentenced to a term of imprisonment, he will ordinarily serve that term in a State prison in the State in which he is convicted. Prison systems differ significantly from State to State, but that is something which, in relation to federal offenders, is contemplated by s 120 of the Constitution." It may be added that it is not uncommon for an accused person, standing trial in a State court, to be charged with both State and federal offences. In drug cases, for example, an accused may be charged with federal offences of importing, and State offences of trafficking. Not only are federal offenders imprisoned with State offenders; the same person may be both a State and a federal offender. References to uniformity of treatment of federal offenders may be misleading unless practical considerations of this kind are taken into account. (2003) 77 ALJR 812; 196 ALR 282. 4 Williams v The King [No 2] (1934) 50 CLR 551 at 560 per Dixon J. (1992) 174 CLR 455 at 467. 6 Williams v The King [No 2] (1934) 50 CLR 551 at 560. There is no justification for distinguishing, as the argument for the appellant seeks to do, between the procedures referred to in s 68(1) and powers. Paragraphs (a) to (d) of s 68(1) refer to procedures of various kinds which typically involve or create powers. The laws of a State or Territory to which s 68(1) refers apply "so far as they are applicable". Although there is not in s 68, as there is in s 79 of the Judiciary Act, an express qualification to the operation of the provision by the use of the words "except as otherwise provided by the Constitution or the laws of the Commonwealth", in the context of a problem such as the present there is little, if any, functional difference between the two forms of qualification. The meaning of "otherwise provided" was considered in Northern Territory v GPAO7. Relevantly for present purposes, s 52 of the Sentencing Act would not be picked up and applied by s 68 if a Commonwealth law expressly or by implication made contrary provision, or if there were a Commonwealth legislative scheme relating to the sentencing of the appellant which was "complete upon its face" and can "be seen to have left no room" for the operation of s 528. Since the appellant relies upon both kinds of other provision, it is necessary to examine in some detail the Commonwealth laws that are said to have that effect. Part 1A of the Crimes Act includes s 4K, which relevantly provides: Charges against the same person for any number of offences against the same provision of a law of the Commonwealth may be joined in the same information, complaint or summons if those charges are founded on the same facts, or form, or are part of, a series of offences of the same or a similar character. If a person is convicted of 2 or more offences referred to in subsection (3), the court may impose one penalty in respect of both or all of those offences, but that penalty shall not exceed the sum of the maximum penalties that could be imposed if a separate penalty were imposed in respect of each offence." (1999) 196 CLR 553 at 587-588 [78]-[80] per Gleeson CJ and Gummow J. 8 R v Gee (2003) 77 ALJR 812 at 822 [62]; 196 ALR 282 at 295-296. The similarity between s 52 of the Northern Territory Sentencing Act and s 4K(4) of the Commonwealth Crimes Act is apparent, but there is one critical difference. Sub-section (4) of s 4K is expressly related to sub-s (3). It was held by the Court of Appeal in Victoria in R v Bibaoui9, and it was common ground in his appeal, that the sub-sections do not apply to trials on indictment, but apply only to summary proceedings. It was explained by Tadgell JA in that case10 that sub-s (3) was necessary in the case of summary proceedings, but unnecessary in the case of indictments. There was a background of State and Territory laws which made provision for the joinder of indictable offences, but did not make provision for joinder of summary offences11. The Court of Appeal held there was every reason to give the expression "information, complaint or summons" its ordinary meaning which, as Ormiston JA said, referred to "well known processes for commencing criminal proceedings in summary jurisdictions"12. There is no reason to doubt the correctness of Bibaoui. The above provisions were originally enacted as s 45B(2) and (3) of the Acts Interpretation Act 1901 (Cth), inserted by the Acts Interpretation Amendment Act 1984 (Cth). They were re-enacted in the Crimes Act by the Crimes Legislation Amendment Act 1987 (Cth). It is of significance that they pre-dated the provisions of Pt 1B of the Crimes Act, which were enacted in the knowledge that the Crimes Act itself provided for aggregate sentencing in the case of some offences to which Pt 1B was to apply, that is to say, offences dealt with summarily. Part 1B was included in the Crimes Act by the Crimes Legislation Amendment Act (No 2) 1989 (Cth). It was described by Ormiston JA in Bibaoui13 as introducing "convoluted and confusing provisions relating to ... sentencing". In Director of Public Prosecutions (Cth) v El Karhani14, Kirby P, Campbell and Newman JJ, sitting as the New South Wales Court of Criminal Appeal, adopted Hunt J's description of the legislation as "unnecessarily complicated and opaque"15. The reasons for judgment concluded with a strong statement of the 10 [1997] 2 VR 600 at 607. 11 eg R v Jackson (1998) 72 SASR 490 at 513. 12 [1997] 2 VR 600 at 602. 13 [1997] 2 VR 600 at 600. 14 (1990) 21 NSWLR 370 at 372. 15 Quoting R v Paull (1990) 20 NSWLR 427. need for reform of Pt 1B16. In a passage to which I shall return, the same three judges gave an account of the history of the legislation which demonstrates that it would be erroneous to suggest that it implemented a policy, adopted in Reports of the Australian Law Reform Commission, of ensuring uniformity in the sentencing of federal offenders. It will be necessary to return to the history, because some of the appellant's arguments appear to depend upon such a theory, which was contradicted by the joint judgment in El Karhani. Part 1B of the Crimes Act deals with the sentencing, imprisonment and release of federal offenders. Division 2 (ss 16A - 16D) deals with general sentencing principles. In particular, ss 16A and 16B refer to matters to which a court, sentencing a person for a federal offence, must have regard. The actual decision in El Karhani was that those matters are not comprehensive, and that Pt 1B is not a code. In particular, it makes no reference to general deterrence, a matter so obviously relevant to sentencing that the statement of matters to which regard must be had is manifestly incomplete. Division 3 included s 16G, concerning a matter of notorious difficulty that arose from the differences between States and Territories resulting from what was called "truth-in- sentencing" legislation. That was a matter singled out in El Karhani as in need of reconsideration. Divisions 4 and 5 deal with fixing non-parole periods and related matters. There are a number of Divisions dealing with unfitness to be tried and mental illness. There are also a number of miscellaneous provisions. The s 4K argument It is submitted on behalf of the appellant that s 4K, which expressly permits aggregate sentencing in the case of federal offences dealt with summarily, gives rise to a negative implication excluding the application of a provision such as s 52 of the Sentencing Act (and its South Australian counterpart) in the case of federal offences dealt with on indictment. This argument is undermined by part of the very reasoning that leads to the conclusion that sub-ss 4K(3) and (4) apply only to summary proceedings. Sub-section (4) is to be read together with sub-s (3). Subsection (3) was necessary in relation to summary proceedings, but it was unnecessary in relation to proceedings on indictment, because of the background of State and Territory laws providing for joinder of indictable offences. The appellant's argument concerning the negative implication must apply to both sub-sections. Yet this would be a most curious and oblique method of excluding the possibility of joinder of charges in the case of proceedings on indictment in respect of federal offences. Such joinder was accepted to be possible in both Bibaoui and Jackson. 16 (1990) 21 NSWLR 370 at 387. It is convenient, and is common in practice. In ASIC v DB Management Pty Ltd17 this Court said that it has often been pointed out that the principle of interpretation that "an express reference to one matter indicates that other matters are excluded" is not of universal application and that the assistance to be gained from it varies widely. In the present case, there is an obvious explanation of the legislature's decision to deal specifically with joinder in summary proceedings (which was necessary), and of the decision not to deal specifically with joinder in indictments (which was unnecessary). Furthermore, an intention to prevent joinder in indictments is virtually inexplicable, and bringing about such a result would cause manifest inconvenience. Sub-sections (3) and (4) work together. They should not be understood as importing the negative implication for which the appellant contends. There is, however, one significant respect in which sub-s 4K(4) tells against the appellant's case. It has already been noted that sub-s 4K(4) was in the Crimes Act, and before that, the Acts Interpretation Act, before the inclusion of Pt 1B. Part 1B, in its statement of principles to be applied in sentencing for federal offences, covers both summary and indictable offences. It therefore covers cases to which sub-s 4K(4) applies. It follows that aggregate sentencing, as provided for in sub-s 4K(4), is not antithetical to the provisions of Pt 1B. Those provisions must be able to co-exist with aggregate sentencing, because they exist together in the legislation, and Pt 1B was introduced into legislation that already provided (in relation to summary proceedings) for aggregate sentencing. That is to be kept in mind when considering the appellant's next argument. The Pt 1B argument It is necessary to say something further about the history of Pt 1B. In El Karhani18, Kirby P, Campbell and Newman JJ said: "The Australian Law Reform Commission has for many years been examining the reform of the sentencing of Federal offenders. It has considered some of the fundamental problems referred to above: see, eg, Sentencing of Federal Offenders, ALRC 15 (1980) Interim; Sentencing, ALRC 44 (1988). It was not suggested that the sections of the Act which must now be given meaning arose from the reports of that Commission. The Court was not taken to those reports. A glance at them since argument shows that, whilst some of the provisions in the Act may have 17 (2000) 199 CLR 321 at 340 [42]. 18 (1990) 21 NSWLR 370 at 375. been influenced by the recommendations of the Commission, its relevant terms cannot be traced to those recommendations. Looked at realistically, it appears that the impetus for introducing the Act, changing the nomenclature of punishment and providing for adjustment was to respond to the particular discordancy created in New South Wales by the passage of the Sentencing Act 1989. It was to do so in ways which extended the range of alternatives to imprisonment (as proposed by the Law Reform Commission) and to set out a number of general principles to be observed in the sentencing of Federal offenders". (emphasis added). Kirby P, Campbell and Newman JJ did not attribute to the Australian Law Reform Commission responsibility for Pt 1B. They were very critical of the new legislation19. In particular, they said20 that Pt 1B glossed over, and left unresolved, the difficult policy choices identified earlier in their judgment, the most notable of which was whether all federal offenders should be treated equally with one another, or whether, "out of recognition that they are housed side by side with State offenders in State prisons ... their punishment [should] be assimilated, approximately, with that of State prisoners"21. It is completely inconsistent with what was said in El Karhani to suggest that Pt 1B was enacted in conformity with the recommendations of the Law Reform Commission, or that it pursued a consistent and coherent policy of prescribing that all federal offenders be treated in the same way, regardless of where they were tried. Part 1B no doubt reflected some of the thinking of the Law Reform Commission, and increased the degree of uniformity of treatment of federal offenders, but their Honours placed some distance between the work of the Law Reform Commission and what they regarded as an unsatisfactory piece of legislation. What was described in El Karhani as "the impetus" for Pt 1B was the difficulty that arose by reason of the truth in sentencing legislation introduced in New South Wales in 1989. The background to that legislation is discussed in R v Maclay22. It is unnecessary to go into the detail. It is sufficient to say that there was a radical alteration in the system of remissions, and the relationship between minimum terms and head sentences. Parity of sentencing, including parity in relation to State and federal offences, became a major problem. 19 (1990) 21 NSWLR 370 at 372, 387. 20 (1990) 21 NSWLR 370 at 387. 21 (1990) 21 NSWLR 370 at 375. 22 (1990) 19 NSWLR 112. In El Karhani, the Court of Criminal Appeal decided that the sentencing principles stated in Pt 1B were not comprehensive; they did not set out to cover the field. The Court observed that Pt 1B did not set out to implement a policy of full uniformity of treatment of federal offenders as between themselves; on the contrary, it failed to address that issue in a consistent and coherent fashion. The Explanatory Memorandum dealing with Pt 1B said that the legislation had 13 main purposes: to review and consolidate the legislation relating to the sentencing and release on parole of federal offenders; to give further guidance to the courts when sentencing federal offenders; to provide a separate regime for fixing federal non-parole periods rather than relying on applied State or Territory legislation; that federal offenders to provide the commencement of the new sentencing provisions will not have their non-parole periods reduced by remission, notwithstanding that State law, in some jurisdictions, provides for remissions to reduce State non-parole periods; sentenced after to provide new procedures for the release of federal offenders on parole or licence; to provide new procedures for the revocation of parole orders and licences and for the determination of the period to be served in custody by a person for breach of a condition of the parole order or licence; to establish new procedures for federal offenders charged on indictment with a federal offence and who are found unfit to plead or unfit to be tried or not guilty on the grounds of mental illness; to provide new procedures for magistrates courts when dealing summarily with federal matters where the defendant is mentally ill or intellectually disabled; to provide the additional sentencing options of hospital orders, psychiatric probation orders (for mentally ill offenders) and program probation orders (for intellectually disabled offenders); to provide clarification that the Commonwealth's spent convictions scheme covers the Defence Force and that the assessment of prospective consultants by law enforcement, intelligence and security agencies and the cash transaction reports agency is exempted from the operation of the scheme; to clarify and improve the efficiency of the various statutory processes involved in the reporting of transactions under the Cash Transaction Reports Act 1988; to introduce an alternative mechanism for verifying the identity of new signatories to accounts; and to enable State and Territory Supreme Courts to issue warrants under the National Crime Authority Act 1984 for the arrest of National Crime Authority witnesses who have absconded or are likely to abscond." Notably missing from that statement of purposes is any reference to an overriding or general purpose of providing complete uniformity of treatment as between federal offenders. It is impossible to conclude that Pt 1B left no room for the application of, or was inconsistent with, s 52 of the Sentencing Act. Such a conclusion depends upon its comprehensiveness, and the attribution to the legislature of a policy which cannot be discerned in the legislation. a misunderstanding of exaggeration of its history, It may be added that the decision of this Court in Kesavarajah v The Queen23 is inconsistent with a proposition that State and Territory laws cannot be picked up unless they are expressly provided for in Pt 1B. That case concerned procedures for determining fitness to be tried. State or Territory law governs the method of determining fitness to be tried. Division 6 of Pt 1B governs the consequences. The two work together. Discrimination The appellant submits that the application of s 52 of the Sentencing Act (and, no doubt, its South Australian counterpart) would result in constitutionally impermissible discrimination between federal offenders. This submission cannot stand with the decision of this Court in Leeth v The Commonwealth24. Section 68 of the Judiciary Act reflects a permissible legislative choice25, and one which, for 23 (1994) 181 CLR 230. 24 (1992) 174 CLR 455. 25 R v Gee (2003) 77 ALJR 812 at 814 [7]; 196 ALR 282 at 285. a century, has resulted in some differences in the sentencing of federal offenders according to where they are sentenced. Section 68 applies State and Territory laws to important aspects of criminal proceedings in relation to federal offences. If State and Territory laws were all necessarily the same, then there would be little point in having State and Territory legislatures. Conclusion The appeal should be dismissed. GUMMOW AND HEYDON JJ. In the Supreme Court of the Northern Territory ("the Territory"), the Director of Public Prosecutions for the Commonwealth, prosecuting in this behalf for the Queen, charged the appellant on two counts of defrauding the Commonwealth contrary to s 29D of the Crimes Act 1914 (Cth) ("the Crimes Act")26 and two counts each of breaching s 266(1) and s 269(1)(b) of the Bankruptcy Act 1966 (Cth) ("the Bankruptcy Act"). Section 266(1) of the Bankruptcy Act proscribes certain dispositions with intent to defraud creditors and s 269(1)(b) the conduct by undischarged bankrupts of various business activities. The maximum penalty for each of the bankruptcy offences was three years imprisonment and that for the contravention of s 29D of the Crimes Act was 10 years imprisonment. Section 4G of the Crimes Act classifies as indictable offences offences against laws of the Commonwealth which are punishable by imprisonment for a period exceeding 12 months. Section 69(1) of the Judiciary Act 1903 (Cth) ("the Judiciary Act") requires the prosecution by indictment of indictable offences against the laws of the Commonwealth. The counts in the indictment of the appellant alleged commission of the offences at Alice Springs. Section 70A of the Judiciary Act applied and permitted the trial to be held in any State or Territory27. This provision was made in furtherance of the concluding words of s 80 of the Constitution, "if the offence was not committed within any State the trial shall be held at such place or places as the Parliament prescribes". The appellant pleaded guilty to all counts and the sentencing judge (Bailey J) sentenced him to what was identified as "an aggregate term of imprisonment" of four years. On appeal to the Court of Criminal Appeal, the appellant submitted that the sentencing judge had erred in law and lacked the power to impose an aggregate term of imprisonment upon his conviction for multiple federal offences joined in the same indictment. The consequence, it was submitted, was that the sentencing order was a nullity. The Court of Criminal Appeal (Martin CJ, Mildren and Riley JJ) dismissed the appeal. In this Court, the appellant renews those submissions. The Attorney-General of the Commonwealth has intervened in support of the Director of Public Prosecutions. 26 Section 29D was repealed by Item 149, Sched 2, Pt 1 of the Criminal Code Amendment (Theft, Fraud, Bribery and Related Offences) Act 2000 (Cth) and now appears as s 134.1 of the Criminal Code Act 1995 (Cth). 27 See Fittock v The Queen (2003) 77 ALJR 961 at 962 [7]; 197 ALR 1 at 3. Section 68 of the Judiciary Act In opposition to the appeal, reliance is placed upon the translation into federal law by the operation of s 68 of the Judiciary Act of a provision dealing with aggregate sentences of imprisonment which is found in the Sentencing Act (NT) ("the Sentencing Act"). Section 52 of the Sentencing Act states: "(1) Where an offender is found guilty of 2 or more offences joined in the same information, complaint or indictment, the court may impose one term of imprisonment in respect of both or all of those offences but the term of imprisonment shall not exceed the maximum term of imprisonment that could be imposed if a separate term were imposed in respect of each offence. (2) A court shall not impose one term of imprisonment under subsection (1) where one of the offences in respect of which the term of imprisonment would be imposed is an offence against section 192(3) of the Criminal Code. Subsection (1) does not apply if one of the offences in the information, complaint or indictment is a violent offence or a sexual offence." Reliance is placed upon s 52(1) in its unqualified form. Given the nature of the offences to which the appellant pleaded guilty, sub-s (3) thereof could have no application. Sub-section (2) operates by reference to s 192(3) of the Criminal Code Act (NT) ("the Criminal Code"). That provision also is concerned with a sexual offence and the result is that s 52(2) of the Sentencing Act could have no application to the present case. In Solomons v District Court of New South Wales, Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ said28: "Section 68 itself distinguishes between jurisdiction on the one hand and powers and procedures on the other. Sub-section (1) provides for State laws with respect to procedure to apply 'so far as they are applicable'. Sub-sections (4) and (5A) confer powers respectively to amend informations and, in appropriate circumstances, to decline to exercise jurisdiction. Sub-section (2) is concerned with the ambit of the jurisdiction rather than the content of the powers to be exercised under it." 28 (2002) 211 CLR 119 at 134 [19]. Section 68(2) of the Judiciary Act gave to the Supreme Court of the Northern Territory the like jurisdiction with respect to persons charged with offences against the laws of the Commonwealth to that with respect to "the trial and conviction on indictment" of persons charged with offences against the laws of the Territory. The expression "the trial and conviction on indictment" has to be read in the light of the primary meaning of the word "conviction". This denotes the judicial determination of a case by a judgment involving two matters, a finding of guilt or acceptance of a plea of guilty followed by sentence29. The words "or Territory" were added after the word "State" wherever occurring in s 68 by s 14 of the Judiciary Amendment Act 1976 (Cth) ("the 1976 Act"). That s 68(2) validly authorises the exercise of jurisdiction by Territory courts with respect to the trials of those charged with offences against the laws of the Commonwealth follows from the reasoning in John Pfeiffer Pty Ltd v Rogerson30 and Re the Governor, Goulburn Correctional Centre; Ex parte Eastman31. The contrary has not been suggested by any party in this case. Section 68(1)(c) of the Judiciary Act provides that the laws of the Territory "respecting ... the procedure for ... trial and conviction on indictment" shall, subject to the balance of s 68, apply "so far as they are applicable to persons who are charged with offences against the laws of the Commonwealth in respect of whom jurisdiction is conferred on the several courts of [the Northern Territory] by this section". The powers conferred under sentencing laws fall within that description in s 68(1)(c)32. Accordingly, on the face of s 68(1) of the Judiciary Act, the power conferred by the Territory law, s 52(1) of the Sentencing Act, to impose the one term of imprisonment in respect of all offences was available to the sentencing judge in respect of the federal offences of which the appellant pleaded guilty. The appellant contests that outcome on several grounds. Inapplicability of the Territory law? The first ground taken by the appellant concerns the limitation imposed by the presence in s 68(1) of the Judiciary Act of the phrase "so far as [the Territory laws] are applicable". Similar expressions appear in ss 79 and 80 of the Judiciary 29 S v Recorder of Manchester [1971] AC 481 at 506. 30 (2000) 203 CLR 503 at 518-519 [18]-[19], 530-531 [54], 532 [58], 544 [103]. 31 (1999) 200 CLR 322 at 339-340 [33]-[34], 347-348 [62]-[63], 349 [67]. 32 R v Jackson (1998) 72 SASR 490 at 513. Act and have been the subject of numerous judicial decisions. In the most recent in this Court, Solomons and British American Tobacco Aust Ltd v Western Australia33, the earlier cases are collected and the principles to be drawn from them discussed. In both Solomons and British American Tobacco, this Court decided that certain State legislation was inapplicable in the exercise of the federal jurisdiction of which the State courts in question were seized. Essentially, this was because to do so would have involved severing and "picking up" part, but not the whole, of an integrated legislative scheme and giving an altered meaning to that severed part of the State legislation. No such difficulty arises with s 52(1) of the Sentencing Act. The appellant points to sub-ss (2) and (3). These qualify or exclude the operation of s 52(1) with respect to certain sexual offences. But to pick up s 52(1) with respect to the federal fraud offences in question here is not to give s 52(1) an altered or limited meaning. It bears upon the Commonwealth fraud offences in the same way as it applies to offences of that general description under Territory law. Other provision by the Crimes Act? The next objection taken by the appellant turns upon the need to read s 68 with other laws of the Commonwealth, in particular with Pt 1B of the Crimes Act. This was introduced by s 6 of the Crimes Legislation Amendment Act (No 2) 1989 (Cth), Act No 4 of 1990 ("the 1990 Act"). Part 1B (ss 16-22A) is headed "Sentencing, imprisonment and release of federal offenders". The introduction of Pt 1B postdates the amendment of s 68 by the 1976 Act so as to refer to the Territories as well as the States. At one level, any interrelation between the 1990 Act and the provisions of s 68 as they stood at the commencement of the 1990 Act might be thought to turn upon the application of the principles concerned with implied repeal of an earlier statute by a later statute of the same legislature. The doctrine of implied repeal is said to depend upon the demonstration of "actual contrariety"34. 33 (2003) 77 ALJR 1566; 200 ALR 403. 34 Butler v Attorney-General (Vict) (1961) 106 CLR 268 at 275; Dossett v TKJ Nominees Pty Ltd (2003) 202 ALR 428 at 432 [14], 438 [43]. Similar questions may arise with consideration of other provisions of the Judiciary Act, including ss 39, 64, 79 and 80. However, for example, s 79 contains the phrase "except as otherwise provided by the Constitution or the laws of the Commonwealth", thereby giving the provision an ambulatory operation. Section 68(1) of the Judiciary Act does not repeat that expression. However, like s 79, s 68 has a "basal character" for the operation of federal jurisdiction35. It appeared to be accepted by the parties in this Court that s 68(1) was to be read in the sense it would have if, as a matter of express statement rather than implication, there was a qualification for provision otherwise made from time to time by the laws of the Commonwealth. That understanding should be accepted. On that footing the appellant puts the case, as he did in the Court of Criminal Appeal, that Pt 1B of the Crimes Act "covers the field in relation to the sentencing of federal offenders in superior courts". Particular reliance was placed upon s 4K of the Crimes Act. It is submitted that, subject to the applicability of s 4K in relation to summary proceedings, Pt 1B, supplemented by the common law of Australia, excludes aggregate sentencing by superior courts sentencing federal offenders. These submissions should be rejected. Before turning to consider the matter in more detail, further reference is necessary to s 4K of the Crimes Act. Section 4K of the Crimes Act It is sub-ss (3) and (4) of s 4K that are in point. These state: "(3) Charges against the same person for any number of offences against the same provision of a law of the Commonwealth may be joined in the same information, complaint or summons if those charges are founded on the same facts, or form, or are part of, a series of offences of the same or a similar character. If a person is convicted of 2 or more offences referred to in subsection (3), the court may impose one penalty in respect of both or all of those offences, but that penalty shall not exceed the sum of the maximum penalties that could be imposed if a separate penalty were imposed in respect of each offence." 35 cf Goward v The Commonwealth (1957) 97 CLR 355 at 360; R v Gee (2003) 77 ALJR 812 at 822 [62]; 196 ALR 282 at 295-296. These provisions were construed by the Court of Appeal of Victoria in R v Bibaoui36. It was held that the power conferred by s 4K(4) to impose a single penalty in respect of two or more offences charged in the same information, complaint or summons pursuant to s 4K(3) was confined to summary offences and so did not apply to indictable offences. It follows that s 4K(4) had no application to the appellant. With respect to his sentence, s 4K was not a law of the Commonwealth which otherwise provided so as to exclude the operation of s 68(1) of the Judiciary Act to "pick up" s 52(1) of the Sentencing Act. Section 4K first had life as s 45B of the Acts Interpretation Act 1901 (Cth) ("the Interpretation Act") which was included in Pt X thereof by the Acts Interpretation Amendment Act 1984 (Cth)37. Part X was repealed by the Crimes Legislation Amendment Act 1987 (Cth) ("the 1987 Act")38. That statute39 also introduced s 4K into the Crimes Act in an expanded form from that of the repealed s 45B. The Court of Appeal of Victoria correctly decided in Bibaoui that the phrase in s 4K "information, complaint or summons" identifies the processes for commencing criminal proceedings in courts of summary jurisdiction. It is true that "information" is a term not confined to summary procedures. However, the use of an information filed in the Queen's Bench Division of the High Court of Justice as an alternative to an indictment in some cases of misdemeanour was rarely used in England even a century ago40. Something should be said here of the position respecting the joinder in summary process of more than one offence or matter of complaint. The procedures in England under s 10 of the Summary Jurisdiction Act 1848 (UK)41 required that the originating process "shall be for One Matter of Complaint only, and not for Two or more Matters of Complaint"42. In the present case, the Court of Criminal Appeal pointed out, with reference to s 57 of the Justices Act 1902 38 s 74(1), Sched 5. 39 By s 11. 40 Halsbury's Laws of England, 1st ed, vol 9, "Criminal Law and Procedure" at 329. 41 11 & 12 Vict c 43. 42 See R v Cridland (1857) 7 E & B 853 at 870 [119 ER 1463 at 1470]. (NSW)43, that in some Australian jurisdictions there remains an express denial of power of joinder of charges on complaints or informations. On the other hand, for example, s 51(1) of the Justices Act (NT) states: "Charges for any number of offences may be joined in the same complaint, if the charges arise out of the same set of circumstances." This disparity in summary procedures between the States and the Territories provided the occasion for the enactment of s 4K(3) of the Crimes Act which, in turn, led to the aggregated sentencing provision in s 4K(4). The qualification in s 4K(3) "if those charges are founded on the same facts, or form, or are part of, a series of offences of the same or a similar character" has a particular history. This is concerned not with summary procedure but with trials on indictment and was detailed in the speech of Lord Devlin in Connelly v Director of Public Prosecutions44. Section 4 of the Indictments Act 1915 (UK) stated: "Subject to the provisions of the rules under this Act, charges for more than one felony or for more than one misdemeanour, and charges for both felonies and misdemeanours, may be joined in the same indictment, but where a felony is tried together with any misdemeanour, the jury shall be sworn and the person accused shall have the same right of challenging jurors as if all the offences charged in the indictment were felonies." Rule 3 of Sched I provided: "Charges for any offences, whether felonies or misdemeanours, may be joined in the same indictment if those charges are founded on the same facts, or form or are a part of a series of offences of the same or a similar character." (emphasis added) In England before 1915, a rule of law forbade a prosecutor from including both felonies and misdemeanours in the one indictment. However, the general rule was that in misdemeanours any number could be joined, subject to the exercise 43 This states: "Every information shall be for one offence only, and not for two or more offences. Every such complaint shall be for one matter only and not for two or more matters." 44 [1964] AC 1254 at 1349-1351. See also the remarks of Brennan J in Ryan v The Queen (1982) 149 CLR 1 at 22. by the court of a power to quash the indictment in extreme cases45. In the case of felony, there was "a rule of practice" forbidding the inclusion of more than one felony in any indictment46; this was "for the purpose of protecting prisoners from oppression"47. Certain exceptions and qualifications were developed in the case law. The requirements for joinder found in r 3 of Sched I to the 1915 statute expressed a continuing concern for oppression of defendants by the inclusion of too much in the one indictment. Similar forms of words for joinder indictments were adopted in Australian jurisdictions. In 1964, the Queensland Criminal Code was amended to include s 568(6) in terms resembling the English provision. The operation of s 568(6) was considered by Barwick CJ, Gibbs and Mason JJ in Mackay v The Queen48. Similar provision was made in Victoria49 and in South Australia by s 278(1) of the Criminal Law Consolidation Act 1935 (SA) but with the important qualification, explained in R v Jackson50. This is that, under the South Australian legislation (s 275), an information filed in the Supreme Court or in the District Court may properly be regarded for all purposes as an indictment. Finally, in the Territory provision to similar effect to s 278(1) of the South Australian statute is made by s 309(1) of the Criminal Code. The result was that, whilst s 4K of the Crimes Act made particular provision with respect to joinder in summary process (with qualifications drawn from the revised indictment procedures) and for aggregated sentencing, no such specific provision was made by federal law with respect to the trial on indictment of federal offences. In particular, the question of the existence of any power of aggregated sentencing upon charges tried on indictment was left to the operation of s 68(1) of the Judiciary Act. The appellant seeks to deny that proposition by reference to the enactment, subsequent to that of s 4K, of Pt 1B of the Crimes Act by the 1990 Act. 45 Connelly v Director of Public Prosecutions [1964] AC 1254 at 1350. 46 Connelly v Director of Public Prosecutions [1964] AC 1254 at 1349. 47 R v Lockett, Grizzard, Gutwirth and Silverman [1914] 2 KB 720 at 731. 48 (1977) 136 CLR 465 at 469. 49 By r 2 in the Sixth Schedule to the Crimes Act 1958 (Vic); see Ryan v The Queen (1982) 149 CLR 1 at 22; R v Bibaoui [1997] 2 VR 600 at 603, 607. 50 (1998) 72 SASR 490 at 512-513. Moorebank to be applied? The appellant referred to what was said, with reference to the Queensland limitation legislation and the recovery provisions of the Income Tax Assessment Act 1936 (Cth) ("the Assessment Act"), in Deputy Commissioner of Taxation v Moorebank Pty Ltd51. The particular issue in that case was whether the recovery provisions "relevantly cover[ed] the field"52 so as to leave "no room"53 for s 64 of the Judiciary Act54 to apply the Queensland legislation. The Court was not persuaded that there was necessarily "any direct inconsistency", but concluded that the recovery provisions "relevantly cover[ed] the field"55. In particular, "the intrusion of State Limitation Acts provisions would significantly undermine the scheme for collection and recovery of tax which is contained in the Assessment Act"56. The appellant relies on that reasoning, but it does not apply in the present case. First, as is apparent from the Explanatory Memorandum for the Bill which became the 1990 Act (which introduced Pt 1B), the 1990 Act had various objectives in amending the Crimes Act. These varied between the making of exhaustive provision on some subjects and supplementary provision on others. An example of the former is the provision by Div 4 of Pt 1B (ss 19AB-19AK) of what the Memorandum had identified as "a separate regime for fixing federal non-parole periods rather than relying on applied State or Territory legislation"57. The appellant relies in particular upon Div 2 of Pt 1B (ss 16A-16D) and Div 3 (ss 16E-19AA), headed respectively "General sentencing principles" and "Sentences of imprisonment". These answer the broad but non-exhaustive terms 51 (1988) 165 CLR 55. 52 (1988) 165 CLR 55 at 66. 53 (1988) 165 CLR 55 at 66. 54 Section 64 states: "In any suit to which the Commonwealth or a State is a party, the rights of parties shall as nearly as possible be the same, and judgment may be given and costs awarded on either side, as in a suit between subject and subject." 55 (1988) 165 CLR 55 at 66. 56 (1988) 165 CLR 55 at 66. 57 Australia, Senate, Crimes Legislation Amendment Bill (No 2) 1989, Explanatory Memorandum at 1. of the Memorandum "to give further guidance to the courts when sentencing federal offenders". Secondly, Pt 1B is to be read with the other and pre-existing provisions of the Crimes Act, which include s 4K. The presence of s 4K denies any proposition that Pt 1B "covered a field" as an exhaustive statement of the will of the Parliament with respect to sentencing for federal offences. This consideration led the appellant to redraw this postulated field so as to exclude sentencing for summary offences. But that process encounters the difficulty that, on their face, those express provisions which Pt 1B does make are not so confined. Thirdly, it is not the case that the operation of s 68(1) of the Judiciary Act to enable the exercise of the power in s 52(1) of the Sentencing Act would undermine the provisions of Pt 1B of the Crimes Act. Reference was made in argument to par (c) of s 16A(2) of the Crimes Act. This provision perhaps reflects what earlier had been said by Brennan J in Ryan v The Queen58: "When an accused person is convicted on two or more counts regularly joined, the trial judge is entitled to assess an appropriate overall sentence having regard to the entire course of criminal conduct which constitutes the several elements of the offences of which the accused is convicted." Paragraph (c) obliges the sentencing court to take into account: "if the offence forms part of a course of conduct consisting of a series of criminal acts of the same or a similar character – that course of conduct". The operation of this mandatory provision is not undermined by the presence of an attendant power conferred by s 68(1) of the Judiciary Act to apply s 52(1) of the Sentencing Act by imposing the one term of imprisonment in respect of all the offences but so as not to exceed the maximum term that could be imposed were a separate term imposed in respect of each offence. Nor does the exercise of that power to apply s 52(1) clash with the requirement in s 17A(1) of the Crimes Act that the sentencing court be satisfied, after consideration of all other available sentences, the circumstances of the case". that "no other sentence is appropriate in all The reasoning of the majority of the Court in Wong v The Queen59 does not require any different conclusion to that expressed above respecting the power 58 (1982) 149 CLR 1 at 22. 59 (2001) 207 CLR 584. conferred by s 52(1) of the Sentencing Act. Their Honours held60 that the starting point required by the sentencing "guidelines" propounded by the Court of Criminal Appeal for narcotics importation offences was inconsistent with the requirement to consider the range of matters detailed in s 16A of the Crimes Act. This was because the guidelines provided for the fixing of presumptive sentences by a grid founded entirely on the gravity of the offence as measured only by the weight of narcotic concerned. Reference also was made by the appellant to s 16BA of the Crimes Act. This is not a new provision. It previously was s 21AA of the Crimes Act and was introduced into Pt 1B and renumbered by s 35 of the 1990 Act. Section 16BA provides a procedure whereby in certain circumstances in passing sentence for convictions the court may take into account offences in respect of which guilt is admitted but there has been no trial. Sub-section (10) states: "An offence taken into account under this section shall not, by reason of its so being taken into account, be regarded for any purpose as an offence of which a person has been convicted." With this, sub-s (4) is to be read. This provides: "Where the court takes into account under this section all or any of the offences in respect of which the person has admitted his guilt, the sentence passed on him for any of the offences of which he has been convicted shall not exceed the maximum penalty that the court would have been empowered to impose on him for the offence if no offence had been so taken into account." There is no contrariety between the scheme for which s 16BA provides and the exercise of the aggregated sentencing power in s 52(1) of the Sentencing Act in respect of multiple convictions. Finally, the appellant referred to the use of the singular "sentence" throughout Pt 1B. That does not imply that, according to the context, the plural cannot be meant. There is here but the faintest support for the suggestion that s 68(1) of the Judiciary Act is denied by Pt 1B of the Crimes Act any operation to apply an aggregated sentencing provision in State or Territory law. 60 (2001) 207 CLR 584 at 609-611 [71]-[73], 616 [87] per Gaudron, Gummow and Hayne JJ, 631-632 [129]-[131] per Kirby J. Unequal treatment? An argument also was put to the effect that to give s 68(1) the operation it had in the Supreme Court of the Northern Territory in this case was to exceed that which was permitted by the Constitution. The consequence would appear to be that s 68(1) must be read down to preserve its validity and to deny any application of s 52(1) of the Sentencing Act. The submission was that s 52(1) "would ... provide for the unequal treatment of equals" and this was "prohibited discriminatory treatment, contrary to the Constitution". However, in oral submissions the appellant disavowed any application to seek leave to re-open Leeth v The Commonwealth61. That case is authority that, specific restrictions and implications arising from the federal structure apart, there is no implication to be drawn from the Constitution that federal laws must operate uniformly throughout the Commonwealth. The choices of venue authorised by s 80 of the Constitution and provided in this case by s 70A of the Judiciary Act, to which reference has been made earlier in these reasons, coupled with the operation of s 68(1), meant that the laws of the Commonwealth did not mandate a single sentencing outcome in respect of the appellant's contraventions of the Crimes Act and the Bankruptcy Act. The same may be said of actions in federal jurisdiction where ss 79 and 80 of the Judiciary Act are engaged. It may also be said in the United States, at least since Erie Railroad Co v Tompkins62, of the application of State law in federal cases by the progenitor of s 79 found in the Rules of Decision Act63. One of the grounds assigned by Brandeis J in Erie for eschewing "the federal common law" was the need to avoid "grave discrimination" by differential outcomes of State law disputes heard in the diversity jurisdiction of a federal court and in a State court64. Further, as Gleeson CJ observed of s 68 in R v Gee65: 61 (1992) 174 CLR 455. 63 Section 34 of the Judiciary Act of 1789. See Northern Territory v GPAO (1999) 196 CLR 553 at 587; Chemerinsky, Federal Jurisdiction, 4th ed (2003) at 312-315. 64 304 US 64 at 74-75 (1938). 65 (2003) 77 ALJR 812 at 814 [7]; 196 ALR 282 at 285. See also at 822 [63]; 296 of ALR per McHugh and Gummow JJ, 831 [115]-[116]; 308-309 of ALR per Kirby J, 840 [180]; 321 of ALR per Callinan J. to federal offences "That general policy reflects a legislative choice between distinct alternatives: having a procedure for the administration of criminal justice in relation the Commonwealth; or relying on State courts to administer criminal justice in relation to federal offences and having uniformity within each State as to the procedure for dealing with State and federal offences. The choice was for the latter." is uniform throughout that term These points are worth remarking "discrimination" as a solvent to issues arising in a federal court structure itself dictates no easy or universal answer. to utter indicate that the That does not gainsay the proposition in Pfeiffer66 that the common law choice of law rules in Australia apply the lex loci delicti as the law governing all questions of substance in a proceeding arising from an intranational tort. After referring to the recognition in s 80 of the Judiciary Act of the Australian common law, it was said in the joint judgment in Pfeiffer67: "No question presently arises as to the position which would obtain if s 80 were displaced by a specific statutory federal choice of law rule68. Nor is it necessary to determine what would have been the position if s 80 had not been enacted or were repealed. A question would have arisen as to whether the common law choice of law rules ... nevertheless apply in federal jurisdiction as part of the ultimate constitutional foundation." That question was not decided. Thus, the outcome in Pfeiffer casts no shadow on the rather different issues of statute law considered earlier in Leeth. Conclusion The appeal should be dismissed. 66 (2000) 203 CLR 503 at 544 [102]. 67 (2000) 203 CLR 503 at 531 [56]. 68 See, eg, Domicile Act 1982 (Cth), and compare Trusts (Hague Convention) Act 1991 (Cth). Kirby KIRBY J. This is another case69 concerned with the operation of those provisions of the Judiciary Act 1903 (Cth)70 that permit the "picking up" and application of non-federal laws in proceedings in a State or Territory court exercising federal jurisdiction. Such provisions effectively allow a useful integration of the statute law of a State or Territory with the federal law that has enlivened the jurisdiction concerned. However, the application is subject to a number of qualifications. These include the paramountcy of the operation of valid federal laws; the operation of any implications applicable to the particular case concerning inconsistency of the other law with the federal law in question; the need sometimes to adapt the local law to apply in a different context; and the occasional impossibility of marrying the laws of the two systems. These difficulties are recognised in the language of the Judiciary Act itself. That Act calls for the application of the State and Territory laws only so far as "they are applicable"71 and with exceptions the Constitution or the laws of the Commonwealth"72. Such modifications would be required in any event. However, they are spelt out by the provisions of the Judiciary Act under which the "picking up" is done. They must be obeyed. that are "otherwise provided by This Court has adopted a broad interpretation of the Judiciary Act so as to make available to parties in federal jurisdiction novel measures enacted by State and Territory law73. Given that the provisions of the Judiciary Act necessitate adaptation of the posited law, so that it can apply in different parts of the Commonwealth74, no narrow view should be taken of its terms. For matters in criminal jurisdiction, State and Territory laws will often be more innovative in procedural law, in particular, than the laws enacted by the Federal Parliament, with its pressing national concerns75. 69 cf Solomons v District Court (NSW) (2002) 76 ALJR 1601; 192 ALR 217; R v Gee (2003) 77 ALJR 812; 196 ALR 282 and British American Tobacco Australia Ltd v Western Australia (2003) 77 ALJR 1566; 200 ALR 403. 70 Judiciary Act 1903 (Cth), ss 68, 79. 71 Judiciary Act, ss 68(1), 79. See also s 80. 72 Judiciary Act, s 79. See also s 80. 73 R v Gee (2003) 77 ALJR 812 at 831 [115]; 196 ALR 282 at 308. 74 Including in federal criminal jurisdiction for which s 68 of the Judiciary Act specifically provides. 75 See eg R v Gee (2003) 77 ALJR 812 at 830-831 [114]; 196 ALR 282 at 308. Kirby Nevertheless, the task presented by the intersection of different legal regimes "necessitates the drawing of lines about which opinions will sometimes divide"76. So it is in the present appeal. I differ from the majority in their finding that the provisions of the Judiciary Act pick up and apply a section of the Sentencing Act (NT)77. There was no contest that the sentencing of Mr Robert Putland ("the appellant") for offences against federal law involved the exercise by the Supreme Court of the Northern Territory of federal jurisdiction78. A close consideration of the applicable federal law, and of the Sentencing Act, read in the light of constitutional and statutory assumptions that apply and decisional authority lead me to a conclusion different from that reached by the majority. My conclusion is influenced not only by the analysis of the language of the intersecting legislation but also by an important consideration of legal principle. Subject to law, federal offenders, convicted of indictable offences, should ordinarily be treated uniformly and without discrimination, wherever their conviction occurs in the Commonwealth. In sentencing they should be so treated unless a valid federal law authorises or contemplates a relevant difference. In this case, none does. The facts, legislation and legislative history The facts that led to the appellant's conviction of the offences against the Crimes Act 1914 (Cth) and the Bankruptcy Act 1966 (Cth) are described in the reasons of Gummow and Heydon JJ ("the joint reasons")79. There set out are the terms of the Sentencing Act which the judge of the Supreme Court, sentencing the appellant, (Bailey J) invoked to impose on him an "aggregate term of imprisonment" of four years. In sentencing the appellant in this way, the judge did not identify the individual sentences which he imposed for each of the federal offences to which the appellant had pleaded guilty. The appellant complains that there was no 76 R v Gee (2003) 77 ALJR 812 at 831 [115]; 196 ALR 282 at 308. 77 Sentencing Act, s 52. 78 Northern Territory v GPAO (1999) 196 CLR 553 at 589-592 [87]-[92], 604 [129], 621-623 [177]-[181], 637-638 [222], 650 [255]. The indictment charged the appellant with offences against the Crimes Act 1914 (Cth), s 29D (defrauding the Commonwealth) and the Bankruptcy Act 1966 (Cth), s 266(1) (disposing of property in the name of another whilst being an undischarged bankrupt), and s 269(1)(b) (carrying on business with intent to defraud creditors after bankrupt). 79 Joint reasons at [27]-[29]. Kirby authority in, or under, federal law to authorise such a sentence. He asserts (and it was common ground) that there was no authority at common law80 to sustain such a sentence81. Accordingly, whilst aggregation in punishment in the sense of the consideration of its totality was to be taken into account82, no warrant existed in law for the sentence imposed. On this ground, the appellant submitted that the sentence was unlawful. The appellant also argued that the aggregate sentence was unjust for its lack of transparency and resulted in the imposition upon him of an excessive punishment. In the absence of identification of the components of the sentence, the aggregate sentence presented serious disadvantages for him and for the just punishment of offenders throughout Australia convicted of the same or similar indictable federal offences. The appellant appealed against his sentence to the Court of Criminal Appeal of the Northern Territory. That court, in accordance with the authority of this Court83, held itself bound to apply the majority view adopted by the Court of Criminal Appeal of South Australia84 concerning the availability of the power in such a case to impose an aggregate sentence. That decision was to the effect that, in imposing sentences upon an offender convicted of indictable federal offences, s 68 of the Judiciary Act "picked up" a State sentencing statute so far as that statute permitted the imposition of a single "aggregate" sentence and applied it to the sentencing of a federal offender. Apart from such authority, the Court of Criminal Appeal went on to satisfy itself that this was the preferable view of the operation of the Judiciary Act85. In this regard it drew upon the reasons of 80 Ryan v The Queen (1982) 149 CLR 1 at 4 per Stephen J, 25 per Brennan J. See Warner, "General Sentences", (1987) 11 Criminal Law Journal 335 at 337-339. 81 Applied to the trial by the Judiciary Act, s 80. 82 Crimes Act, s 16A(2)(c): "In addition to any other matters, the court must take into account such of the following matters as are relevant and known to the court: (c) if the offence forms part of a course of conduct consisting of a series of criminal acts of the same or a similar character – that course of conduct". See also s 16B ("Court to have regard to other periods of imprisonment required to be served") and s 16BA ("Taking other offences into account"). 83 Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485 at 492; see Putland v The Queen [2003] NTCCA 3 at [10]. 84 R v Jackson (1998) 72 SASR 490 (Perry and Nyland JJ; Millhouse J dissenting). 85 Putland v The Queen [2003] NTCCA 3 at [31]. Kirby Gleeson CJ in R v Gee86, citing in turn the opinion of Dixon J in 1934 in Williams v The King [No 2]87 to the effect that the general policy disclosed by the Judiciary Act was to "place the administration of the criminal law of the Commonwealth in each State upon the same footing as that of the State and to avoid the establishment of two independent systems of criminal justice". As I shall show, in relevant ways that policy has been modified by later developments in federal law. The appellant challenges the judgment of the Court of Criminal Appeal. By special leave, his challenge is now before this Court. The issues Five issues are presented by the appeal. They are: The federal jurisdiction issue: Does a Territory court exercise federal jurisdiction in that Territory in conducting the trial of, and in sentencing, a person convicted of a federal offence? This question is answered by the terms of the Judiciary Act itself88 and by the authority of this Court, referred to in the joint reasons89. As the existence of federal jurisdiction was not challenged by either party to this appeal, and arises whichever view is taken of the constitutional status of a court of a self-governing Territory90, no more need be said of this issue. The trial and conviction issue: Does the provision in s 68(1)(c) of the Judiciary Act for the application of the laws of a Territory and the procedure for "trial and conviction on indictment" pick up the substantive law of sentencing so as to apply to a case in federal jurisdiction the provisions of the Sentencing Act conferring the power on a judge to impose an aggregate sentence in respect of conviction for indictable offences? 86 (2003) 77 ALJR 812 at 814 [6]; 196 ALR 282 at 284-285. 87 (1934) 50 CLR 551 at 560. 88 Judiciary Act, s 68(2). See also s 79. 89 Joint reasons at [33]. 90 See eg Northern Territory v GPAO (1999) 196 CLR 553 at 589-592 [87]-[92], 604 [129], 621-623 [177]-[181], 637-638 [222], 650 [255]; Re Governor, Goulburn Correctional Centre; Ex parte Eastman (1999) 200 CLR 322 at 334 [18], 339 [32], 348 [63], 374-378 [133]-[143]; John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR Kirby The "otherwise provided" issue: Assuming that, under s 68 or another section, the Judiciary Act appears to pick up the provisions of the Sentencing Act allowing aggregate sentences, do other federal laws, or does the Constitution itself, "otherwise provide", so as to prevent the "picking up" and application of the Sentencing Act in such a case? The non-applicability issue: By the provisions of s 52 or its scheme and integrated terms, does the Sentencing Act involve such a different and incompatible statement of sentencing principles that it is "inapplicable" to the sentencing of a federal offender such as the appellant and thus outside the terms of the Judiciary Act? Resolution of the ambiguity issue: To the extent that there is ambiguity or doubt about the intersection of the propounded federal and Territory laws, or uncertainty as in the circumstances, are there any constitutional principles or considerations of sentencing policy that suggest that the Territory law is not picked up in a case such as the present, thus requiring individual sentences for federal offenders convicted of indictable offences? to the operation of the Judiciary Act Trial and conviction: jurisdiction and procedures By s 68(1) of the Judiciary Act it is provided, relevantly, (with added emphasis) that: "The laws of a … Territory respecting the arrest and custody of offenders or persons charged with offences, and the procedure for: their trial and conviction on indictment; and for holding accused persons to bail, shall, subject to this section, apply and be applied so far as they are applicable to persons who are charged with offences against the laws of the Commonwealth in respect of whom jurisdiction is conferred on the several courts of that … Territory by this section." The appellant submitted that the purpose of s 68(1), in accordance with the indications of its language and context, was confined to the application, relevantly, of the "procedures" of State or Territory law. The sub-section draws a distinction between "procedure" and "jurisdiction". Elsewhere, the Act draws a Kirby similar distinction between "jurisdiction" and "powers"91. The appellant complained of a confusion between the provision in s 68(1) for the applicability of a procedure and the source of a substantive sentencing power. He argued that the latter was not supplied by s 68(1). The appellant relied both on the absence of a specific power for aggregate sentencing at common law and the existence of a provision of a defined power for aggregate sentencing, confined by federal law to offenders convicted of summary federal offences92. He invoked the distinction noticed by McHugh J in Solomons v District Court (NSW)93 between jurisdiction, powers and procedures. He submitted that this distinction confined the operation of s 68(1) of the Judiciary Act to procedures arising during a trial and at the stage of conviction. It did not extend to the substantive law of sentencing. Even if powers with respect to sentencing might, on a broad view, be regarded as part of the act of "conviction" (and not a step occurring after the "conviction" was complete), the appellant argued that s 52 of the Sentencing Act could not be categorised as a merely "procedural" provision. Support for this submission is found in the context of s 68(1) of the Judiciary Act and the reference there to procedures anterior to the trial (arrest, custody and bail). Support for the distinction may also be found in observations of this Court made in relation to innovative State laws readily characterised as "procedural"94. Such an interpretation of s 68(1) would still leave the sub-section with much work to do. As a particular example, it would permit the laws of States and Territories governing procedures for the joinder of offences on an indictment to be "picked up" and applied to the trial and conviction on indictment of a person accused of a federal offence95. There is therefore much force in the appellant's argument that s 52 of the Sentencing Act is not a provision respecting "procedure" but a substantive provision altering the law of sentencing in a fundamental way by providing a power to the judiciary that does not otherwise exist in law. On this footing, 91 The distinction between the jurisdiction of the Court to hear federal criminal cases and the power of the Court in disposing of such cases is often made: Wong v The Queen (2001) 207 CLR 584 at 627 [119]. 92 Crimes Act, s 4K. 93 (2002) 76 ALJR 1601 at 1609-1610 [43]; 192 ALR 217 at 228-229. 94 Such as the Criminal Law Consolidation Act 1935 (SA), s 350. See R v Gee (2003) 77 ALJR 812 at 814 [7]; 196 ALR 282 at 285. 95 R v Bibaoui [1997] 2 VR 600 at 601; R v Jackson (1998) 72 SASR 490 at 513. Kirby s 68(1), concerning as it does "procedures" not "powers", would have no effect to "pick up" the provisions of the Territory Act for application to the sentencing of a federal offender, even assuming that the law of sentencing could be regarded, broadly, as a law "respecting" the "conviction" of a person charged on indictment. In the end, however, it is unnecessary to resolve this issue. This is because s 79 of the Judiciary Act applies to "pick up" the "laws of each … Territory, including the laws relating to procedure, evidence, and the competency of witnesses". As I pointed out in Solomons96, although, by these terms, s 79 makes specific reference to the laws relating to procedure etc, the identified categories are mentioned "only by way of illustration". This makes it clear that s 79 has a wider ambit. It applies, so long as the conditions in that section are met. These refer to the disqualifying effect of the Constitution or of federal law "otherwise providing" and the requirement that the case in which the local law is invoked must be one to which such law is "applicable". This conclusion brings me to the central arguments in this appeal. Federal laws "otherwise provide" The provisions of federal law: Before considering any implications that may be derived from the Constitution, it is my opinion that certain features of enacted federal law "otherwise provide" within s 79 of the Judiciary Act, so as to exclude the operation of that section (and s 68) with respect to s 52 of the Sentencing Act. None of the identified federal laws can be viewed in isolation. What is in question here involves the overall operation of federal law, specifically the sentencing of offenders convicted of indictable federal offences. Each of the ingredients of federal law must therefore be viewed in relation to the others. The federal offences: The starting point is an appreciation that the appellant pleaded guilty to, and was convicted of, six counts alleging substantive offences against federal law. Each of those offences, unsurprisingly, had a national element. The first two counts, of defrauding the Commonwealth, comprised offences against s 29D of the Crimes Act. Whilst fraud is not an uncommon offence in the laws of the States and Territories of Australia, the nominated victim in the appellant's case, the Commonwealth, gave the appellant's crimes a special character97. They involved an offence against the national community, represented by the Commonwealth. This consideration, and the 96 (2002) 76 ALJR 1601 at 1622 [117]; 192 ALR 217 at 246-247. 97 New South Wales Bar Association v Hamman [1999] NSWCA 404 at [85] per Mason P. Kirby element of breach of civic duty in defrauding the Australian people, is one commonly taken into account in sentencing of federal offenders convicted, as here, of tax evasion and elsewhere of social security fraud and other like federal offences. Quite properly, this aspect of the character of the crime was mentioned by the sentencing judge. He pointed out98: "The tax system is based on trust and depends, for its effective operation, on the honesty of taxpayers." Because the victim of the crime is, in effect, the Australian community, the offence is the same for every offender throughout the Commonwealth. On the face of things, without a clear statutory indication of a different purpose or other justification, it would ordinarily be assumed that the approach to sentencing of offenders convicted of such a crime would not vary, or vary significantly, upon the chance consideration of where the offender happened to be tried and convicted within Australia. It was not suggested during argument that there was any "local factor" that would have warranted differential approaches to the sentencing of offenders convicted of such a crime against the national polity in the Northern Territory99. On the face of things, therefore, a consistent national level of punishment was called for. The other counts to which the appellant pleaded guilty related to offences against ss 266(1) and 269(1)(b) of the Bankruptcy Act. These offences concerned disposing of property with intent to defraud creditors after bankruptcy and carrying on business in the name of another person whilst an undischarged bankrupt. Here again, each offence was one against a national law. On the face of things, such offences are designed to uphold the same standards of probity and honesty on the part of bankrupts everywhere in Australia. No "local factor" appeared to warrant differential sentencing of the appellant. Starting, therefore, with the offences themselves, the suggestion that a Territory law could introduce a different approach to sentencing, resulting either in higher or lower punishment of offenders convicted of such federal offences, is unappealing. We are not talking here of novel procedural facilities. We are concerned with the substantive law of punishment under a national statute and a suggestion that differential components may be introduced into that punishment, with inevitable consequences for individual liberty. Section 4K – a limited and specific provision: An indication that the Federal Parliament did not intend the importation into the sentencing of offenders 98 Reasons for sentence at 6. 99 cf Leeth v The Commonwealth (1992) 174 CLR 455 at 476 per Brennan J. Kirby convicted of indictable federal offences of a power for the aggregation of such sentences, may be found in s 4K of the Crimes Act. As is pointed out in the other reasons100, that section can be traced to an earlier manifestation in federal law before it was enacted in its current form as s 4K101. I agree with the other reasons that the interpretation adopted by the Victorian Court of Appeal in R v Bibaoui102 is correct. By the reference in s 4K(3) of the Crimes Act to "the same information, complaint or summons" it must be accepted that the provision for the imposition of aggregate sentences on convicted federal offenders was confined to those convicted of summary offences. It did not extend to indictable offences such as those brought against the appellant. The provisions of s 4K were in the Crimes Act when relevant reforms to federal sentencing law, in the form of Pt 1B, were introduced into the Crimes Act by the Crimes Legislation Amendment Act (No 2) 1989 (Cth) ("the 1989 Act"). Whether or not these reforms were "unnecessarily complicated"103 or as comprehensive as would have been desirable, is beside the present point. The task of this Court is to interpret them. Moreover, it must do so as a final court with a national perspective and constitutional duty to the whole of Australia. This should make the Court less sensitive to the disturbance of State (and Territory) sentencing prerogatives than a State (and Territory) judge may sometimes be. Certainly, State judicial complaints, such as those made in Director of Public Prosecutions (Cth) v El Karhani104 have fallen on deaf federal ears in the 15 years since the 1989 reforms were enacted. The statutory changes were not withdrawn. The law of sentencing did not revert. This Court must therefore give full effect to the change of direction in sentencing of federal offenders introduced in 1989. In El Karhani, having expressed their complaints about some of the language of Pt 1B of the Crimes Act and having recorded the history and limitations of the Part, the participating judges meticulously applied 100 See reasons of Gleeson CJ at [10]; the joint reasons at [45]; the Acts Interpretation Amendment Act 1984 (Cth) inserted s 45B in the Acts Interpretation Act 1901 (Cth). 101 By the Crimes Legislation Amendment Act 1987 (Cth), s 11. 103 See comments in R v Paull (1990) 20 NSWLR 427 at 437 cited in Director of Public Prosecutions (Cth) v El Karhani (1990) 21 NSWLR 370 at 372. 104 (1990) 21 NSWLR 370. Kirby its terms. They did so by reference to those provisions, point by point105. They recognised, and conformed to, the new federal sentencing regime as enacted. This Court should do no less. The 1989 Act followed a report of the Australian Law Reform Commission ("the Commission"). As was pointed out in El Karhani106, the Act implemented some, but not all, of the Commission's recommendations. The Commission's report on sentencing was delivered in 1988107. That report had followed an earlier interim report concerned with sentencing of federal offenders delivered in 1980108. In the earlier report, the Commission addressed directly the problem of differential punishment of federal offenders in different parts of Australia. It did so by reference to the arrangements then in place under the Commonwealth Prisoners Act 1967 (Cth). That Act imported into the punishment of federal offenders significantly different State procedures and substantive rules109. Of these, the Commission said110: "Commonwealth laws should implement the principle that offenders against the laws of the Commonwealth should be treated as uniformly as possible throughout Australia. Commonwealth laws and procedures which hinder the achievement of uniformity should be changed to bring them into accord with this principle even if doing so results, for a time, in differences in the way in which Commonwealth and local offenders are treated within a State or Territory jurisdiction." Whilst variations in procedural matters might persist, permitting the incorporation of innovative State and Territory procedures varying as between 105 Director of Public Prosecutions (Cth) v El Karhani (1990) 21 NSWLR 370 at 380- 106 (1990) 21 NSWLR 370 at 375 cited in the reasons of Gleeson CJ at [17]. 107 Australian Law Reform Commission, Sentencing, Report No 44, (1988). 108 Australian Law Reform Commission, Sentencing of Federal Offenders, Report No 15 Interim, (1980). 109 The definition of "federal offender" in the Commonwealth Prisoners Act 1967 (Cth) did not apply to an offender sentenced in the Australian Capital Territory who was subject to the Prisoners (Australian Capital Territory) Act 1968 (Cth); see R v Paivinen (1985) 158 CLR 489. See also R v Shrestha (1991) 173 CLR 48; Leeth v The Commonwealth (1992) 174 CLR 455. 110 Australian Law Reform Commission, Sentencing of Federal Offenders, Report No 15 Interim, (1980) at xxxiii (emphasis added). Kirby different Australian jurisdictions, in substantive matters, the Commission's approach favoured the general uniformity of punishment of persons convicted of the same offences throughout the nation. To this extent, the Commission adopted a view that departed from the one explained by Dixon J in 1934 in Williams111. This change in relation to sentencing was before the Parliament when s 4K was moved into the Crimes Act. True, a simple change was not adopted, as the Commission had proposed. The enacted reforms fell short of embracing the full ambit of the Commission's recommendations112. But the in- built inequalities of the regime in the Commonwealth Prisoners Act were changed. That Act was repealed. The introduction of Pt 1B demanded uniform sentences of federal offenders to the extent there provided113. This was something new. Inevitably, it reduced the virtually complete integration of the sentencing of a federal offender with those of the States that had preceded the 1989 Act. To the extent that the Federal Parliament continued a specific provision allowing aggregation of federal offences for sentencing purposes, it confined that provision to summary offences. It could have adopted aggregation of sentences as part of the new national rules on the sentencing of federal offenders. Behind the choice that it made lay an arguable view of sentencing policy. In respect of some multiple offences against federal laws (such as repeated offences of a summary character against taxation or social security laws) aggregation in sentences could be viewed as suitable and appropriate. However, in respect of more serious federal offences, for which provision is specifically made for trial on indictment (invoking the requirements of jury trial under the Constitution114), the normal obligation, provided by the common law, was to continue to apply so far as federal law is concerned. Accordingly, each conviction required a separate sentence. To the extent that, in the case of indictable offences for which no express federal power of aggregation of sentences is provided, it is necessary to consider a number of related sentences together, this is addressed in federal law by the specific requirement that sentencing judges have regard to the principle of 111 Above at [71]. 112 As pointed out in Director of Public Prosecutions (Cth) v El Karhani (1990) 21 NSWLR 370 at 375. See the extract quoted in the reasons of Gleeson CJ at [17]. 113 See Fox and Freiberg, Sentencing: State and Federal Law in Victoria, 2nd ed 114 Constitution, s 80. Kirby totality in sentencing, whether expressed in the common law115 or in the statutory provisions supplementing or replacing that common law rule116. It is not ignored. No statutory provision is made in the law of the Commonwealth, New South Wales, Queensland, Victoria117 or Western Australia118 for aggregate sentencing of offenders convicted of indictable offences. Only in three Australian jurisdictions does the local sentencing law permit aggregate sentencing for indictable offences, namely South Australia119, Tasmania120 and the Northern Territory121. The position in the Australian Capital Territory is unclear122. The result is that, if the present appeal is dismissed, not only is a serious divergence in the sentencing of persons convicted of indictable federal offences introduced. It is imposed on such offenders by the supposed operation of the general provisions of the Judiciary Act123. The Judiciary Act has not specifically addressed the issue. Yet that Act is held to expand the operation of s 4K of the Crimes Act in a way that the Federal Parliament has expressly held back from doing explicitly, arguably for sound reasons of sentencing policy. 115 Postiglione v The Queen (1997) 189 CLR 295 at 308-309 approving R v Gordon (1994) 71 A Crim R 459 at 466 per Hunt CJ at CL. 116 See eg Crimes Act, Pt 1B, ss 16A(2)(c), 16B and 16BA. 117 Sentencing Act 1991 (Vic), s 9 confers on the Magistrates' Court the power to impose an aggregate sentence of imprisonment, including for indictable offences being tried summarily. 118 Sentencing Act 1995 (WA), ss 76, 85, 86, 89 and 94; Sentence Administration Act 1999 (WA). The term "aggregate" is used in the Sentencing Act 1995 (WA) in the same sense as in the Crimes Act, s 16. 119 Criminal Law (Sentencing) Act 1988 (SA), s 18A. 120 Sentencing Act 1997 (Tas), s 11. 121 Pursuant to the Sentencing Act, s 52(1). 122 See Interpretation Act 1967 (ACT), s 33C, inserted in 1985. This section is in terms similar to the Crimes Act, s 4K. The joinder in the same "information or summons" of multiple offences is permitted where the offences are against the same provision of an Act which permits a single penalty to be imposed. However, exceptionally, in the Australian Capital Territory, proceedings in superior courts may be commenced by "information". 123 Judiciary Act, s 79 and, possibly, s 68. Kirby With all respect to those of the opposite view, insufficient attention has been paid to the negative implication concerning the purpose of the Federal Parliament in transferring and re-enacting s 4K as part of the general criminal statute of the Commonwealth. Had it wished to do so, the Parliament might there and then have incorporated a provision permitting an extension of the principle of aggregate sentences to indictable federal offences. This could have been done quite simply by including the word "indictment" in s 4K(3) of the Crimes Act. To do so would have been compatible with the introduction of a new general regime for the sentencing of federal offenders – not exhaustive, it is true, but still comprehensive. This was not done. The omission is to be evaluated against the background of a lively debate, coinciding with the enactment of s 4K of the Crimes Act, concerning the general desirability of ensuring, in matters of substance, the equal punishment of federal offenders for indictable federal offences wherever such offenders are convicted in the Commonwealth. The view of the Court of Criminal Appeal, now endorsed, undermines the achievement of that important federal objective which this Court should uphold. At the least, it should do so to the extent that the Parliament expressly so provided. In so far as the new federal sentencing principles enacted in Pt 1B of the Crimes Act so provided, the Federal Parliament accepted the principle earlier enunciated by the Australian Law Reform Commission124. That principle is incompatible with the principle now adopted by this Court. When the new Pt 1B was enacted, the Parliament did not enact an amendment to s 4K (as it might simply then have done) to permit aggregate sentences in the case of federal offenders convicted of indictable offences. Instead, it left that provision confined to sentencing of federal offenders convicted of summary offences. It is true that care must be taken in the application of the maxim of interpretation expressio unius est exclusio alterus125. Nevertheless, the persistence in the relevant federal law (indeed the re-enactment therein) of a specific provision limited to summary offences, especially at the time of the enactment of several general principles for sentencing of federal offenders, suggests legislative endorsement of a policy that excludes aggregation of sentences in the most serious cases of conviction of 124 Australia, House of Representatives, Parliamentary Debates (Hansard), 5 October 1989 at 1603 (Mr Robert Brown for the Federal Attorney-General, Mr Lionel Bowen). 125 The express mention of one person or thing implies the exclusion of the other. See Houssein v Under Secretary of Industrial Relations and Technology (NSW) (1982) 148 CLR 88 at 94; cf State of Tasmania v The Commonwealth of Australia and State of Victoria (1904) 1 CLR 329 at 343. Kirby multiple indictable offences126. The distinction between summary and indictable offences is not an inconsequential one. It is reflected in s 80 of the Constitution. It follows that, when it was suggested that the provisions of s 52 of the Sentencing Act were "picked up" and applied to the sentencing of the appellant, the proper answer that a court should give is that federal law, namely s 4K of the Crimes Act "otherwise provided". It did so by the re-enacted terms of s 4K. By its particularity that section rendered the Judiciary Act "inapplicable" to a case of federal offences that were indictable127. Part 1B – a new federal sentencing regime: The foregoing conclusion is reinforced by the provisions of Pt 1B of the Crimes Act. However imperfect and incomplete that Part may have been as a code, the introduction of Pt 1B undoubtedly represented an important step for the Federal Parliament in relation to the sentencing of convicted federal offenders. This Court should not undermine it. It would have been simple for Pt 1B of the Crimes Act to have included amongst the new federal sentencing provisions an unrestricted power to impose an aggregate sentence on persons convicted of federal offences triable on indictment. Such a provision was not enacted. On the contrary, the specific provisions contained in the Part indicate, with sufficient clarity, that separate sentences were to be imposed in respect of each such conviction128. The new Pt 1B was designed to introduce into the federal law of sentencing a distinct set of rules applicable throughout the nation129, save where derogations were clearly stated or permitted130. 126 In this I agree with the dissenting view of Millhouse J expressed in R v Jackson (1998) 72 SASR 490 at 502. 127 Judiciary Act, s 68(1) (assuming that the section applies). 128 Crimes Act, ss 19(1), 19(2), 19(3), 19AB(1) and 19AB(2) each requires the imposition of separate sentences with identified commencing dates, although allowing for a single non-parole period. 129 cf R v Ngui (2000) 1 VR 579 at 583 [12] where Winneke P referred to the particular importance "where the offences are created by Commonwealth statutes" of achieving consistency to the extent possible because "sentences for such offences are being imposed by courts throughout Australia" (footnote omitted). 130 A similarly restrictive view of the power of State law to intrude upon the scheme of Pt 1B of the Crimes Act was taken in Wong v The Queen by Callinan J: see (2001) 207 CLR 584 at 643 [167]. The introduction of differing State "sentencing guidelines" fixed by judges was held by the majority of this Court to be incompatible with the "legislative command" in Pt 1B of the Crimes Act. Kirby In Wong v The Queen131, the joint reasons of Gaudron, Gummow and Hayne JJ emphasised the obligation of judges throughout Australia to obey the "legislative command of Pt 1B of the Commonwealth Crimes Act" in sentencing convicted federal offenders. There was no further judicial complaint about the perceived imperfections of the Part such as had been voiced in El Karhani. Their Honours in Wong stressed the impermissibility of disobedience to the command in Pt 1B, as by giving effect to guideline judgments devised by courts in different States by reference to considerations distinct from those contained in Pt 1B. How much more important, in the federal system of government within which Pt 1B of the Crimes Act must operate, is it to obey the "legislative command of Pt 1B" instead of different commands of the substantive statutory law of sentencing of an individual State or Territory, enacted as part of an integrated package of sentencing law in that State or Territory in terms significantly different from those contained in the "legislative command of Pt 1B"132? In Wong133, I pointed out that the "common feature of the list [in s 16A(2) of the Crimes Act appearing within Pt 1B was] that a sentence will be imposed which addresses all the individual circumstances of the offence and the offender". I was part of the majority in that appeal that concluded that obedience to Pt 1B was not "the hypothesis upon which the 'guideline judgment' … [was] drawn"134. By identical analysis it was not the hypothesis upon which s 52 of the Sentencing Act was enacted for the Northern Territory. In the case of indictable Territory offences s 52 looks to the aggregate sentence as would be appropriate. In the case of indictable federal offences, the Crimes Act looks only at the particular offence and offender. In this case, this Court should adopt an approach consistent with that which it adopted in Wong. The different source of the attempt of a State (or Territory) to vary the "legislative command of Pt 1B" – statutory rather than judicial – makes no difference to the obedience required. The Court's object in Wong was not to reprove State judges. It was to insist on conformity with the command of federal law. We should be no less insistent now. Where there is an explicit federal law that deals comprehensively, even if not in all respects exhaustively or as a code, with the substantive law of 131 (2001) 207 CLR 584 at 610 [72]. 132 Wong v The Queen (2001) 207 CLR 584 at 610 [72] per Gaudron, Gummow and 133 Wong v The Queen (2001) 207 CLR 584 at 633 [135]. (emphasis added) 134 Wong v The Queen (2001) 207 CLR 584 at 633 [135]. Kirby sentencing in the way Pt 1B of the Crimes Act does, that legislative scheme is not to be undone by the operation of the general provisions of the Judiciary Act. Because federal law has "otherwise provided", the provisions of the Judiciary Act do not apply. In the face of that incompatible provision, State and Territory sentencing laws are not "applicable". Federal law has validly occupied the field. Under the Constitution, no State or Territory law may derogate from, or impair, the operation of the federal law in its area of competence. El Karhani and the absence of inconsistency: Contrary to the opinion of Gleeson CJ in this appeal135, there is no inconsistency between the foregoing reasoning and what I said in 1990 as one of the judges who participated in El Karhani136. If there were, it would require a recantation. The earlier analysis would be wrong or incomplete – a reflection perhaps of seeing the provisions of Pt 1B of the Crimes Act from a different judicial perspective, in the context of a different legal problem, considered at an earlier time. But there is no inconsistency and no need to recant. In this Court, it is natural and proper to consider problems from the perspective of the constitutional setting of the case and a national viewpoint. Here, the question of direct compatibility of federal and local law clearly arises. It did not arise in El Karhani. Since that case was decided in 1990, the Federal Parliament has enacted many more criminal offences, enlarging the ambit of federal crimes falling for the imposition of sentences in a lawful and principled way. The ambit of federal crime is infinitely greater now than in 1934 when Dixon J propounded his views in Williams137. Since 1990, the Parliament has not repealed, or relevantly modified, the provisions of Pt 1B of the Crimes Act. Despite the judicial complaints voiced in El Karhani concerning features of those provisions, the enactment of a special law to govern the sentencing of federal offenders in a particular way, has remained unchanged. That law was applicable to this case. No State or Territory law could require, or permit, otherwise. The objection to the introduction of differences – certainly significant differences – in the type and level of punishment of persons convicted of federal offences, on the sole basis of the geography of their trial (and hence of the court that sentences them) rests on basic legal principle. It is one similar to that which 135 Reasons of Gleeson CJ at [18]-[20]. 136 (1990) 21 NSWLR 370. 137 (1934) 50 CLR 551 at 560. See above at [71]; cf the passage cited by Gleeson CJ in R v Gee (2003) 77 ALJR 812 at 814 [6]; 196 ALR 282 at 284-285. This is another illustration of the need to understand judicial opinions in the time and context in which they were expressed. Kirby forbids the introduction into administrative decision-making of considerations irrelevant or extraneous to the power138. It is to be assumed that a power (here to sentence) conferred upon a repository (here the sentencing judge) by or under a single legal source (here the provision of the Crimes Act) will be exercised in a consistent and equal way, unless the law-maker with the same authority has validly authorised a variation. The chance consideration of the venue of the trial is not a valid point of differentiation for the punishment of the federal crime. It is the duty of this Court to say so. The constitutional arrangements that permit the vesting of federal jurisdiction in State courts (and by analogy in Territory courts, assuming that such jurisdiction is not federal of its very nature) may permit some variations, generally of a procedural or adjectival kind, to creep in. They do not, however, authorise variations contrary to the express provisions of federal law. To "pick up" and apply local sentencing measures that modify the punishment of federal offenders and reduce the transparency of such punishment, would require clear and express provisions. There are none in this case. El Karhani says nothing to the contrary. The Territory law is "inapplicable" The essential basis for my conclusion that the Territory law invoked here is not "applicable" for the purposes of the Judiciary Act is therefore that federal law "otherwise provided". However, the appellant relied upon additional arguments of inapplicability derived from a close attention to the terms of the Sentencing Act itself. Thus, the appellant pointed out that s 52 of the Sentencing Act contains two qualifications relating to aggregate sentencing in the particular case of a sexual or violent offence. They constitute important riders on the general application of that section. According to the appellant, these qualifications were part of a detailed and integrated Territory provision for aggregate sentencing made by s 52, deemed suitable to the criminal law of a Territory which indicate that that section could not be severed and picked up for federal sentencing purposes and limited to the application of s 52(1)139. The appellant also pointed to the comprehensive list of considerations relevant to sentencing, contained in the general provisions of the Sentencing Act, of which s 52 is a part. He submitted that these provisions were incompatible with the quite different federal list of sentencing principles contained in the 138 Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 503-504 [70]. 139 There are, however, federal sexual offences provided by the Crimes Act, Pt IIIA. Kirby Crimes Act. As such, it made picking up bits and pieces from the Territory law on sentencing dangerous. This was so, the appellant argued, because it could be assumed that each part of the local law was intended to operate in relation to others. Dissecting the Territory law would amount to an attempt to achieve a marriage of incompatibles. Moreover, it would introduce significant uncertainty and complexity into the sentencing of persons convicted of indictable federal offences. This, in turn, would undermine a major purpose of the 1989 amendments to the Crimes Act that introduced Pt 1B. There is force in these submissions. However, I do not need to resolve them. For the reasons already given, s 52 of the Sentencing Act is not "applicable" to the sentencing of an offender convicted of indictable federal offences, such as the appellant. The appellant's additional arguments would merely reinforce the conclusion I have already reached. The Court of Appeal erred in deciding the contrary. Resolution of any residual ambiguity Considerations endorsing inapplicability: Having arrived at the foregoing conclusion, it is strictly unnecessary for me to consider the constitutional principle invoked by the appellant to lend still further strength to his statutory arguments. Nevertheless, the appellant's arguments should be mentioned because, in my view, they are persuasive and strengthen the conclusion that I have reached. For those who may still feel doubt after analysis of the intersecting legislation, there are important considerations of constitutional principle and of sentencing policy that endorse the same conclusion. Additional constitutional considerations: The appellant did not seek to argue that the decision of the majority of this Court in Leeth v The Commonwealth140 was wrong141. That question remains for another day. The appellant was content to avoid a direct challenge. However, he drew attention to what the Court had actually decided in that case. In Leeth, the majority, the the Commonwealth could, by a federal law, give a varying operation to its laws by providing for the operation of the laws of the States (and Territories) in a case in federal jurisdiction. It could do so whilst remaining consistent with the Constitution142. Gaudron J, who dissented, also held that it was inevitable that joint reasons, accepted that 140 (1992) 174 CLR 455. 141 Joint reasons at [59]. 142 Leeth v The Commonwealth (1992) 174 CLR 455 at 468-469 per Mason CJ, Kirby some differences would flow from the exercise of federal jurisdiction by State (or Territory) courts143. However, the appellant argued that the majority principle was subject to two qualifications. The first was that basic sentencing principles should remain uniform, although their application might require weight to be given, in a particular case, to local factors144. Furthermore, discriminatory treatment, whereby "equals" were treated unequally, although convicted of a crime in the exercise of a federal sentencing power, would be regarded as contrary to the Constitution145. Recently, the latter principle has been endorsed by this Court in the joint reasons of Gaudron, Gummow and Callinan JJ in Cameron v The Queen146. The present appellant submitted that it would be discriminatory treatment if he were to be subjected to an aggregate sentence by a court in the Northern Territory, without disclosure to him of the individual sentences imposed for the offences to which he pleaded guilty. This was so because, had he been convicted and sentenced in most other jurisdictions of Australia, he would have been so entitled. Without entering upon the larger question of whether the Constitution imports implications of basically equal punishment for the same federal offence throughout Australia wherever the conviction and sentencing of a federal offender takes place, there is force in the appellant's more limited submission147. The venue of the appellant's trial and conviction is irrelevant to the sentence imposed on him for that offence. It is immaterial to his right to know how that sentence is constructed. Subject to any valid exception provided by law, the normal postulate of the Constitution is that persons convicted of federal offences in State and Territory courts will be uniformly punished in like circumstances wherever in the nation that sentence is imposed148. That postulate derives from the single source of the power to sentence, conferred by the legislature of the same polity, namely the Commonwealth. 143 Leeth v The Commonwealth (1992) 174 CLR 455 at 502. 144 Leeth v The Commonwealth (1992) 174 CLR 455 at 476. 145 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 478-479. 146 (2002) 209 CLR 339 at 343-344 [15]. 147 A similar constitutional point was raised in Wong v The Queen (2001) 207 CLR 584 at 638 [148]. In the view that the majority took, it did not have to be decided and was "left to another day". 148 cf Wong v The Queen (2001) 207 CLR 584 at 627 [118]. Kirby Other considerations of policy: Apart from these elements derived from constitutional principle, other considerations of legal principle and policy support the interpretation of the intersecting legislation urged by the appellant. Only if specific sentences are identified for federal indictable offences, such as those of which the appellant was convicted, will the transparency of the sentencing process be fully upheld. Taking into account considerations of totality and of sentences for connected offences in relation to each other is clearly desirable and permissible149. However, the submergence of sentences for major crimes in a single undifferentiated aggregate sentence carries a risk of injustice to the offender. In practical terms, it makes the offender's task of challenging the unidentified components of the aggregate sentence much more difficult150. It risks depriving the offender of the provision of adequate reasons for the components of the sentence. It undermines the objective of identifying differential sentences for specific federal crimes so that their content might be known and compared throughout the Commonwealth by all concerned. It diminishes the effectiveness of the deterrent value of particularised sentences. It reduces the utility and availability of effective appellate review addressed to consistency throughout Australia in the sentencing of federal offenders for particular offences. In some cases, it will "mask error" in the judicial approach to sentencing151. As Professor Warner stated152: "A general sentence has the advantage of simplicity and convenience but may sacrifice considerations of uniformity and predictability at a time when such issues are considered particularly desirable." It is true that, if s 52 of the Sentencing Act is picked up, it does not permit the available maximum penalties for the offences for which the offender is to be sentenced to be changed. This is because of the express prohibition in s 52(1). However, that limitation leaves standing other serious disadvantages in aggregate sentences which doubtless help to explain why such sentences were not available at common law following conviction for connected offences. In this, as in so 149 Permitted under the Crimes Act, s 16A(2)(c). See also ss 16B and 16BA. 150 R v Bibaoui [1997] 2 VR 600 at 603. In the context of the admission of uncorroborated and disputed admissions and confessions to police this Court took a similarly practical and realistic approach to the difficulty which the accused otherwise faced in challenging the admission of such evidence: McKinney v The Queen (1991) 171 CLR 468 at 475-476. 151 cf Pearce v The Queen (1998) 194 CLR 610 at 623-624 [45]. 152 Warner, "General Sentences", (1987) 11 Criminal Law Journal 335 at 344. Kirby many other respects, ours is a criminal justice system demanding a high degree of particularity, especially where what is at stake is the loss of liberty and other punishments. The conclusion that I favour would oblige the Federal Parliament, as it should, to consider explicitly any extension of the aggregate sentencing principle contained in s 4K of the Crimes Act to federal indictable offences, if that were its purpose. The view adopted by the majority allows a substantive exception to the equal treatment of federal offenders convicted in different parts of Australia to the extent that this was enacted by Pt 1B of the Crimes Act, without the salutary obligation for the Federal Parliament itself to address the issue, make a decision and accept the legal and political accountability for the law as then made153. All of these are reasons for maintaining and upholding the choice that was taken by the Federal Parliament in the treatment of aggregate sentencing set out in the Crimes Act. Sentences for summary offences may be aggregated; but not sentences for the typically more serious indictable offences. In the case of indictable offences, specificity in sentencing is at a premium. That is so because the punishment (including, as in the appellant's case, loss of liberty) is typically greater and more onerous. It should therefore be identified and identifiable. Orders The appellant succeeds. The appeal should be allowed. The orders of the Supreme Court of the Northern Territory (Criminal Court of Appeal) should be set aside. In lieu thereof, it should be ordered that the appeal to that court be allowed and the sentence imposed upon the appellant quashed. The proceedings should be remitted to the Court of Criminal Appeal for the resentencing of the appellant. 153 See Lord Hoffmann in R v Secretary of State for the Home Department; Ex parte Simms [2000] 2 AC 115 at 131 cited in Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 77 ALJR 40 at 60 [106]; 192 ALR 561 at 588-589. CALLINAN J. I agree with the conclusion of Gummow and Heydon JJ and the reasons that their Honours give for it, that there is no relevant contrariety between the regime for sentencing for which s 16BA of the Crimes Act 1914 (Cth) provides and the regime for which s 52(1) of the Sentencing Act (NT) provides. The form of sentence imposed could equally have been imposed under either. It was not shown to be otherwise inappropriate or erroneously determined. I also agree with the conclusion and reasons of Gummow and Heydon JJ with respect to the appellant's contention that he was unfairly treated by being discriminated against contrary to the Constitution. I would therefore join in dismissing the appeal.
HIGH COURT OF AUSTRALIA PLAINTIFF S157/2002 PLAINTIFF AND COMMONWEALTH OF AUSTRALIA DEFENDANT Plaintiff S157/2002 v Commonwealth of Australia [2003] HCA 2 4 February 2003 ORDER The questions reserved for consideration by the Full Court are answered as follows: Question 1 Is section 486A of the Migration Act 1958 (Cth) invalid in respect of an application by the plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? Answer Upon its proper construction, s 486A does not apply to the proceedings the plaintiff would initiate. No question of the validity of s 486A arises in that regard. Question 2 Is section 474 of the Migration Act 1958 (Cth) invalid in respect of an application by the plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? Answer Section 474 would be invalid if, on its proper construction, it attempted to oust the jurisdiction conferred on the High Court by s 75(v) of the Constitution. However, on its proper construction, it does not attempt to do so. Section 474 is valid but does not apply to the proceedings the plaintiff would initiate. Question 3 By whom should the costs of the proceeding in this Honourable Court be borne? Answer The Commonwealth should pay 75 per cent of the costs of the plaintiff of the proceeding. Representation: D J Colquhoun-Kerr with G J Williams for the plaintiff (instructed by Parish Patience Immigration Lawyers) D M J Bennett QC, Solicitor-General of the Commonwealth with N J Williams SC, S B Lloyd and G R Kennett for the defendant (instructed by Australian Government Solicitor) Intervener: B M Selway QC, Solicitor-General for the State of South Australia with C Jacobi intervening on behalf of the Attorney-General for the State of South Australia (instructed by the Crown Solicitor for the State of South Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Plaintiff S157/2002 v Commonwealth of Australia Statutes – Construction – Privative clauses – Whether the decision by the Refugee Review Tribunal affirming the decision of a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs refusing the plaintiff's application for a protection visa is a "privative clause decision" within s 474 of the Migration Act 1958 (Cth) ("the Act") – Whether s 474(1) of the Act is construed as ousting judicial review by the High Court. Constitutional Law (Cth) – Whether s 474 and s 486A of the Act are invalid – Whether s 474(1)(c) of the Act is directly inconsistent with s 75 of the Constitution – Whether s 474(1)(a) and (b) of the Act are inseparable from s 474(1)(c) of the Act and are consequently invalid – Whether s 486A of the Act will apply to a "decision" when there has been jurisdictional error – Whether s 486A of the Act is a law incidental to the legislative power conferred by ss 51(xix), (xxvii), (xxix) of the Constitution – Whether s 486A of the Act is within the express incidental power conferred by s 51 (xxxix) of the Constitution – Whether s 486A of the Act is inconsistent with s 75(v) of the Constitution. Immigration – Refugee Review Tribunal – Whether decision affirming the decision of a delegate of the Minister refusing application for a protection visa is a "privative clause decision" within s 474 of the Act – Whether s 474(1) of the Act ousts judicial review by the High Court pursuant to s 75 of the Constitution – Whether s 486A of the Act is constitutionally valid. Words and Phrases: "privative clause decision". Constitution, ss 51 (xix), (xxvii), (xxix), (xxxix), 75, 76. Migration Act 1958 (Cth), ss 5(1), 36, 474, 486A. Judiciary Act 1903 (Cth), ss 39B, 44. GLEESON CJ. The plaintiff wishes to institute proceedings against the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister"), and the Refugee Review Tribunal ("the Tribunal"), invoking the jurisdiction of this Court under s 75(v) of the Constitution to issue writs of prohibition and mandamus against officers of the Commonwealth, and the power, in an appropriate case, to grant ancillary relief in the form of certiorari1. The proceedings in contemplation concern a decision of the Tribunal confirming a refusal to grant the plaintiff a protection visa. The proposed challenge to the decision is based upon the ground of a denial of natural justice "in that [the Tribunal] took into account material directly relevant and adverse to [the plaintiff's claim of refugee status] without giving him notice of the material or any opportunity to address it". The merits of that contention are not presently in issue. Sections 474 and 486A of the Migration Act 1958 (Cth) ("the Act") present potential obstacles to the proceedings. However, the plaintiff contends that those provisions are invalid. He commenced an action in this Court, against the Commonwealth, seeking declarations of their invalidity. Gummow J stated a case for the consideration of a Full Court, asking, as to each section, in its application to the plaintiff's proposed application under s 75(v), whether it is invalid. The questions, and the terms of the legislative provisions, are set out in the judgment of Gaudron, McHugh, Gummow, Kirby and Hayne JJ ("the joint judgment"). For the reasons that follow, I agree with the answers proposed in the joint judgment. It is convenient to begin with a consideration of s 474. Section 474 The first step in the plaintiff's argument, in support of the contention that s 474 is invalid, is an assertion that the section means what it says. It is argued that, in their ordinary and natural meaning, the words of s 474 purport to prevent any applicant from seeking, and any court, including this Court, from granting, any relief with respect to any application for review of a decision of an administrative character (save for some minor exceptions) under the Act. Therefore, the section purports to oust the jurisdiction conferred upon this Court by s 75(v) of the Constitution. The Parliament has no power to do that. The Commonwealth accepts that, if read literally, s 474 would purport to oust the jurisdiction of this Court, and at least to that extent would be invalid. However, the Commonwealth contends that s 474 does not have that meaning. It has a more restricted meaning than that which, at first sight, it appears to convey. It was enacted against a background of established judicial interpretation of similar provisions, and Parliament acted in the light of that interpretation. 1 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 90-91 [14]. Furthermore, s 15A of the Acts Interpretation Act 1901 (Cth) requires that an Act is to be "read and construed subject to the Constitution, and so as not to exceed the legislative power of the Commonwealth." Section 75(v) of the Constitution confers upon this Court, as part of its original jurisdiction, jurisdiction in all matters in which a writ of mandamus, or prohibition, or an injunction, is sought against an officer of the Commonwealth. It secures a basic element of the rule of law. The jurisdiction of the Court to require officers of the Commonwealth to act within the law cannot be taken away by Parliament. Within the limits of its legislative capacity, which are themselves set by the Constitution, Parliament may enact the law to which officers of the Commonwealth must conform. If the law imposes a duty, mandamus may issue to compel performance of that duty. If the law confers power or jurisdiction, prohibition may issue to prevent excess of power or jurisdiction. An injunction may issue to restrain unlawful behaviour. Parliament may create, and define, the duty, or the power, or the jurisdiction, and determine the content of the law to be obeyed. But it cannot deprive this Court of its constitutional jurisdiction to enforce the law so enacted. In the Convention debates at the time of the framing of the Constitution, Mr Barton explained the purpose of the provision2: "This will give the High Court original jurisdiction … in these cases, so that when a person wishes to obtain the performance of a clear statutory duty, or to restrain an officer of the Commonwealth from going beyond his duty, or to restrain him in the performance of some statutory duty from doing some wrong, he can obtain a writ of mandamus, a writ of prohibition, or a writ of injunction. This provision is applicable to those three special classes of cases in which public officers can be dealt with, and in which it is necessary that they should be dealt with, so that the High Court may exercise its function of protecting the subject against any violation of the Constitution, or of any law made under the Constitution." The Parliament cannot abrogate or curtail the Court's constitutional function of protecting the subject against any violation of the Constitution, or of any law made under the Constitution. However, in relation to the second aspect of that function, the powers given to Parliament by the Constitution to make laws with respect to certain topics, and subject to certain limitations, enable Parliament to determine the content of the law to be enforced by the Court. 2 Official Record of the Debates of the Australasian Federal Convention, (Melbourne), 4 March 1898, vol 2 at 1884-1885. Privative clauses which deprive, or purport to deprive, courts of jurisdiction to review the acts of public officials or tribunals in order to enforce compliance with the law, or which limit, or purport to limit, such jurisdiction, may apply in either State or federal jurisdiction. Many of the considerations relevant to their interpretation and application are common to both3. Speaking of a nation with a unitary constitution, Denning LJ said4: "If tribunals were to be at liberty to exceed their jurisdiction without any check by the courts, the rule of law would be at an end." In a federal nation, whose basic law is a Constitution that embodies a separation of legislative, executive, and judicial powers, there is a further issue that may be raised by a privative clause. It is beyond the capacity of the Parliament to confer upon an administrative tribunal the power to make an authoritative and conclusive decision as to the limits of its own jurisdiction, because that would involve an exercise of judicial power.5 Legislation which confers power or jurisdiction on officials or tribunals, or imposes public duties, or enacts laws which govern official conduct, and which, in addition, deprives, or purports to deprive, courts of jurisdiction to control excess of power or jurisdiction, or to compel performance of duties, or to restrain breaches of the law, involves a potential inconsistency. A provision that defines and limits the jurisdiction of a tribunal may be difficult to reconcile with a provision that states that there is no legal sanction for excess of jurisdiction. In 1909, in Baxter v New South Wales Clickers' Association6, Griffith CJ said: "A grant of limited jurisdiction coupled with a declaration that the jurisdiction shall not be challenged seems to me a contradiction in terms." This Court's approach to the interpretation of provisions such as s 474 has been developed over a long period. In Deputy Commissioner of Taxation v Richard Walter Pty Ltd7, Mason CJ said that "they are effective to protect an award or order from challenge on the ground of a mere defect or irregularity 3 See, eg, Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602; Vanmeld Pty Ltd v Fairfield City Council (1999) 46 NSWLR 78. 4 R v Medical Appeal Tribunal; Ex parte Gilmore [1957] 1 QB 574 at 586. 5 R v Coldham; Ex parte Australian Workers' Union (1983) 153 CLR 415 at 419. (1909) 10 CLR 114 at 131. (1995) 183 CLR 168 at 180. which does not deprive the tribunal of the power to make the award or order". Some years earlier, in Church of Scientology v Woodward8, he had said of privative clauses that, "notwithstanding the wide and strong language in which these clauses have been expressed, the courts have traditionally refused to recognize that they protect manifest jurisdictional errors or ultra vires acts". In both cases, reference was made to R v Hickman; Ex parte Fox and Clinton9. The case of Hickman was decided in 1945, but even then there was a history of English and Australian decisions on the meaning and effect of privative clauses. In 1874, the Privy Council, in Colonial Bank of Australasia v Willan10, was dealing with a Victorian mining statute, which contained a provision that no proceeding under the statute should be removed or removable into the Supreme Court, subject to certain exceptions. Their Lordships said11: "It is, however, scarcely necessary to observe that the effect of this is not absolutely to deprive the Supreme Court of its power to issue a writ of certiorari to bring up the proceedings of the inferior Court, but to control and limit its action on such writ. There are numerous cases in the books which establish that, notwithstanding the privative clause in a statute, the Court of Queen's Bench will grant a certiorari; but some of those authorities establish, and none are inconsistent with, the proposition that in any such case that Court will not quash the order removed, except upon the ground either of a manifest defect of jurisdiction in the tribunal that made it, or of manifest fraud in the party procuring it." The concept of "manifest" defect in jurisdiction, or "manifest" fraud, has entered into the taxonomy of error in this field of discourse. The idea that there are degrees of error, or that obviousness should make a difference between one kind of fraud and another, is not always easy to grasp. But it plays a significant part in other forms of judicial review. For example, the principles according to which a court of appeal may interfere with a primary judge's findings of fact, or exercise of discretion, are expressed in terms such as "palpably misused [an] advantage", "glaringly improbable", "inconsistent with facts incontrovertibly established", and "plainly unjust"12. Unless adjectives such as "palpable", "incontrovertible", "plain", or "manifest" are used only for rhetorical effect, then (1982) 154 CLR 25 at 55-56. (1945) 70 CLR 598 at 614-617. 10 (1874) LR 5 PC 417. 11 (1874) LR 5 PC 417 at 442. 12 See, eg, House v The King (1936) 55 CLR 499 at 505; Devries v Australian National Railways Commission (1993) 177 CLR 472 at 479. in the context of review of decision-making, whether judicial or administrative, they convey an idea that there are degrees of strictness of scrutiny to which decisions may be subjected. Such an idea is influential in ordinary appellate judicial review, and it is hardly surprising to see it engaged in the related area of judicial review of administrative action. The reasons for judgment of Dixon J in Hickman have been taken up in the approach of Australian courts to privative clauses, both in State and federal jurisdiction. The decision of the Court was unanimous; and it is important to an understanding of what Dixon J said to note what he and the other members of the Court decided. Like many of the cases on privative clauses in federal jurisdiction, the proceedings concerned an exercise, or purported exercise, of award-making power by an industrial tribunal. A Local Reference Board was given, by the National Security (Coal Mining Industry Employment) Regulations 1941 (Cth) ("the Regulations"), power, by arbitral award, to settle disputes between employers and employees in the coal mining industry. Regulation 17 provided that a decision of a Board should "not be challenged, appealed against, quashed or called into question, or be subject to prohibition, mandamus or injunction, in any court on any account whatever". A Board made an award purporting to cover truck drivers employed by a transportation company which carried coal, as well as other commodities. Their employers sought a writ of prohibition in this Court, on the ground that they were not engaged in the coal mining industry. The employees argued that transportation of coal was part of the coal mining industry. That argument was rejected. Prohibition was granted, on the basis that the Board was acting beyond its powers. Dixon J considered, and rejected, an argument that reg 17 excluded relief. He said:13 "The presence of this provision in the Regulations makes it necessary to say whether and to what extent it is ineffectual to protect the decision of the Board from invalidation. In the first place, it is clear that such a provision cannot, under the Constitution, affect the jurisdiction of this Court to grant a writ of prohibition against officers of the Commonwealth when the legal situation requires that remedy. But a writ of prohibition is a remedy that lies only to restrain persons acting judicially from exceeding their power or authority. It is therefore necessary to ascertain before issuing a writ whether the persons or body against which it is sought are acting in excess of their powers; and that means whether their determination, when made, would be void. The Board derives its power from Regulations of which reg 17 forms a part, and that regulation must 13 (1945) 70 CLR 598 at 614. be taken into account in ascertaining what are the true limits of the authority of the Board, and whether its decision is void." Thus, this Court's jurisdiction to grant prohibition in the event that the Board exceeded its lawful authority could not be taken away by statute. However, the question was whether the Board had exceeded its authority, and that was to be decided by reference to the whole of the Regulations, of which reg 17 formed a part. Dixon J went on to state the primary principle for which his judgment stands14: "In considering the interpretation of a legislative instrument containing provisions which would contradict one another if to each were attached the full meaning and implications which considered alone it would have, an attempt should be made to reconcile them." The essential problem is the inconsistency between a provision in a statute, or an instrument, conferring a limited power or authority, and a provision which appears to mean that excess of power or authority may not be prohibited. When the power or authority is conferred by a federal statute, and it is this Court's constitutional the Commonwealth in excess of power or authority that the statute purports to take away, a possible solution is that urged by the plaintiff in the present case: accept the privative clause at face value, and declare it invalid. However, the reasons of Dixon J show that, although Hickman was decided in the context of federal jurisdiction, he also had unitary constitutions in mind. And his preferred solution, both in State and federal jurisdiction, was attempted reconciliation. His view as to how that could be achieved in the case before him was as follows15: to prohibit acts of officers of jurisdiction "It is, of course, quite impossible for the Parliament to give power to any judicial or other authority which goes beyond the subject matter of the legislative power conferred by the Constitution … It is equally impossible for the legislature to impose limits upon the quasi-judicial authority of a body which it sets up with the intention that any excess of that authority means invalidity, and yet, at the same time, to deprive this Court of authority to restrain the invalid action of the court or body by prohibition. But where the legislature confers authority subject to limitations, and at the same time enacts such a clause as is contained in reg 17, it becomes a question of interpretation of the whole legislative instrument whether transgression of the limits, so long as done bona fide and bearing on its face every appearance of an attempt to pursue the power, necessarily spells invalidity. In my opinion, the application of these principles to the Regulations means that any decision given by a 14 (1945) 70 CLR 598 at 616. 15 (1945) 70 CLR 598 at 616. Local Reference Board which upon its face appears to be within power and is in fact a bona fide attempt to act in the course of its authority, shall not be regarded as invalid." (emphasis added) The echoes of what was said by the Privy Council in Willan are discernible. The concepts of "manifest defect of jurisdiction" and "manifest fraud" are the obverse of what "appears to be within power" and "a bona fide attempt to act in the course of … authority," although it may be noted that, in Willan, the fraud referred to was that of the party procuring the decision. The last sentence in the passage quoted is the application of the principles stated to the particular instrument in question in Hickman. By contrast with the complex legislative scheme presently in question, it was a relatively simple instrument. The Board had power to settle industrial disputes in a certain industry. In that regard, it had to follow certain procedures. In Hickman, it was claimed that a purported decision was beyond power because the dispute in question was between parties who were not in the relevant industry. It might have been thought that the view that they were in the relevant industry was at least fairly open. There was certainly a bona fide attempt by the Board to pursue its powers. Even so, the "decision" (Dixon J said he preferred to call it something else16), in the Court's opinion, did not on its face appear to be within power. Therefore, it was not protected by reg 17 from judicial interference. Giving effect to the whole of a statute which confers powers or jurisdiction, or imposes duties, or regulates conduct, and which also contains a privative provision, involves a process of statutory construction described as reconciliation. The outcome of that process may be that an impugned act is to be treated as if it were valid. Brennan J said in Deputy Commissioner of Taxation v Richard Walter Pty Ltd17, in a passage quoted by Gaudron and Gummow JJ in Darling Casino Ltd v NSW Casino Control Authority18: "In so far as the privative clause withdraws jurisdiction to challenge a purported exercise of power by the repository, the validity of acts done by the repository is expanded." On the other hand it may be that, as in Hickman, the impugned act is not to be treated as if it were valid. In the case of a purported exercise of decision-making authority, limitation on authority is given effect, notwithstanding the privative provision. That may involve a conclusion that there was not a "decision" within the meaning of the privative clause. In a case such as the present, it may involve 16 (1945) 70 CLR 598 at 619. 17 (1995) 183 CLR 168 at 194. 18 (1997) 191 CLR 602 at 630. a conclusion that a purported decision is not a "decision ... under this Act" so as to attract the protection given by s 474. Limitations or conditions on the exercise of power or authority that are given effect, notwithstanding a privative provision, were described by Dixon J in R v Murray; Ex parte Proctor19 as "indispensable". In that case, he described the process of statutory construction contemplated in Hickman as involving two steps20. The first step is to note that the protection afforded by a provision such as reg 17 will be inapplicable unless there has been "an honest attempt to deal with a subject matter confided to the tribunal and to act in pursuance of the powers of the tribunal in relation to something that might reasonably be regarded as falling within its province". The second step is to consider "whether particular limitations on power and specific requirements as to the manner in which the tribunal shall be constituted or shall exercise its power are so expressed that they must be taken to mean that observance of the limitations and compliance with the requirements are essential to valid action". In explanation of the second step, Dixon J referred, by way of analogy, to the distinction between statutory provisions that are directory and those that are mandatory21. That distinction is now in disfavour22. Even so, the process of ascribing legislative purpose, which underlay the distinction, is one with which courts are familiar. The question is "whether it was a purpose of the legislation that an act done in breach of the provision should be invalid."23 Later again, in R v Metal Trades Employers' Association; Ex parte Amalgamated Engineering Union, Australian Section24, Dixon J referred to "imperative duties or inviolable limitations or restraints" which may be imposed by legislation, contravention of which would not be protected by a privative provision. To describe a duty as imperative, or a restraint as inviolable, is to express the result of a process of construction, rather than a reason for adopting a particular construction; but it explains the nature of the judgment to be made. Because what is involved is a process of statutory construction, and attempted reconciliation, the outcome will necessarily be influenced by the particular statutory context. 19 (1949) 77 CLR 387 at 399. 20 (1949) 77 CLR 387 at 399-400. 21 (1949) 77 CLR 387 at 399. 22 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 23 (1998) 194 CLR 355 at 390. 24 (1951) 82 CLR 208 at 248. The approach to the interpretation of statutes containing privative provisions enunciated by Dixon J in Hickman, and developed by him in later cases, has been accepted by this Court as authoritative25. Parliament has legislated in the light of that acceptance. That approach is inconsistent with the plaintiff's submission that s 474 should be read literally, treated as an attempted ouster of this Court's jurisdiction under s 75(v) of the Constitution, and, to that extent at least, declared invalid. In this respect, the argument for the Commonwealth prevails. However, the questions in the case stated deal with the operation of s 474, not in the abstract, but in its application to the proceedings for constitutional writs contemplated by the plaintiff. Those proceedings involve a challenge to a purported decision of the Tribunal on the ground of denial of procedural fairness or natural justice. Accordingly, there was argument from both parties as to the operation of the Act, including s 474, in a case of that kind. In order to establish the context in which the competing arguments on statutory construction are to be considered, it is convenient to identify the issues that would arise apart from the effect of s 474. In that regard, it should be noted that, since the time relevant to this case, Parliament has enacted further legislation, which was assented to on 3 July 2002, and commenced on the following day, dealing with certain aspects of the requirements of natural justice in connection with the operation of parts of the Act26. That legislation is presently irrelevant. In Australian Broadcasting Tribunal v Bond27, Deane J explained that, in the past, it was customary to refer to the duty to observe common law requirements of fairness as a duty "to act judicially". In a passage from Hickman quoted above, Dixon J can be seen using that expression. Later, the duty came to be referred to as a duty to observe the requirements of "natural justice". Later again, it became common to speak of "procedural fairness". The precise content of the requirements so described may vary according to the statutory context; and may be governed by express statutory provision. Subject to any such statutory regulation, and relevantly for present purposes, the essential elements involved include fairness and detachment. Fairness and detachment involve "the absence of the actuality or the appearance of disqualifying bias and the according of an 25 eg Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168; Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602. 26 Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). 27 (1990) 170 CLR 321 at 365-367. appropriate opportunity of being heard"28. A statute may regulate and govern what is required of a tribunal or other decision-maker in these respects, and prescribe the consequences, in terms of validity or invalidity, of any departure.29 Subject to any such statutory provision, denial of natural justice or procedural fairness will ordinarily involve failure to comply with a condition of the exercise of decision-making power, and jurisdictional error. In 1885, the consequences of such failure were described by Lord Selborne in Spackman v Plumstead District Board of Works30, a case concerning the potential for judicial review of an architect's decision as to where a building line should be. The architect's decision-making authority was conferred by statute. His Lordship said31 that, by directing the architect to decide the building line, the statute (by implication) imposed upon him a duty to decide it to the best of his judgment, independently and impartially. His Lordship then said32: "No doubt, in the absence of special provisions as to how the person who is to decide is to proceed, the law will imply no more than that the substantial requirements of justice shall not be violated. He is not a judge in the proper sense of the word; but he must give the parties an opportunity of being heard before him and stating their case and their view. He must give notice when he will proceed with the matter, and he must act honestly and impartially and not under the dictation of some other person or persons to whom the authority is not given by law. There must be no malversation of any kind. There would be no decision within the meaning of the statute if there were anything of that sort done contrary to the essence of justice." In the present context, there is a question whether a purported decision of the Tribunal made in breach of the assumed requirements of natural justice, as alleged, is excluded from judicial review by s 474. The issue is whether such an act on the part of the Tribunal is within the scope of the protection afforded by s 474. Consistent with authority in this country, this is a matter to be decided as an exercise in statutory construction, the determinative consideration being whether, on the true construction of the Act as a whole, including s 474, the requirement of a fair hearing is a limitation upon the decision-making authority of the Tribunal of such a nature that it is inviolable. The line of reasoning 28 (1990) 170 CLR 321 at 367. 29 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 142 [166] per 30 (1885) 10 App Cas 229. 31 (1885) 10 App Cas 229 at 239. 32 (1885) 10 App Cas 229 at 240. developed by Dixon J in Hickman and later cases identifies the nature of the task involved, and the question to be asked. By identifying the task as one of statutory construction, all relevant principles of statutory construction are engaged. It cannot be suggested that Dixon J was formulating a principle of construction which excluded all others. On the contrary, by treating the exercise as a matter of construction he was opening the way for the application of other principles as well. Those principles have been stated by this Court on many occasions, and are as well known to Parliament as Hickman itself. In considering and applying the relevant principles of statutory construction, it is necessary to begin with an examination of the scheme of the Act. For present purposes, the central provisions of the Act are those which concern the making of decisions to grant or refuse visas, which enable a non- citizen lawfully to enter, or remain in, Australia. Unlawful entry into, or presence in, Australia, exposes a person to loss of liberty and compulsory removal. The Act, and the Regulations made under it, provide for multiple classes, and sub-classes, of visa. For each class of visa detailed criteria are provided. These must be satisfied by applicants, and are to be applied by decision-makers. The plaintiff in this case applied for a protection visa. By virtue of s 36 of the Act, a criterion for a protection visa is that the applicant for the visa is a non-citizen of Australia to whom Australia has protection obligations under the Convention relating to the Status of Refugees as amended by the 1967 Refugees Protocol. That Convention includes a definition of "refugee". It is presently unnecessary to note the detail of that definition. It suffices to say that its elements have given rise to much litigation, and have been the subject of judicial interpretation in many cases. Section 65 of the Act provides that if, after considering a valid application for a visa, the Minister is satisfied that the prescribed criteria have been met, the Minister is to grant the visa. If not so satisfied, the Minister is to refuse the visa. The Minister has power to delegate this function. Decisions of the Minister or a delegate are subject to review by the Tribunal. Such a review occurred in the present case. The essence of the plaintiff's application for a visa was that he satisfied the Convention definition of a refugee, and that, pursuant to the Convention, Australia owed him protection obligations. The relevant provisions of the Act constitute the means by which Australia gives effect to its international obligations. The interpretation of the definition of refugee in the Convention is a matter of law. Decisions as to whether a person is someone to whom Australia owes protection obligations often turn upon questions of law; sometimes complex and difficult questions of law. Although it is the provisions of the Act concerning protection visas that are directly relevant in the present case, they are only part of a wider, and more detailed, pattern of legislation which, in a variety involves Australia's of respects, affects fundamental human rights and international obligations. In such a context, the following established principles are relevant to the resolution of the question of statutory construction. First, where legislation has been enacted pursuant to, or in contemplation of, the assumption of international obligations under a treaty or international convention, in cases of ambiguity a court should favour a construction which accords with Australia's obligations33. Secondly, courts do not impute to the legislature an intention to abrogate or curtail fundamental rights or freedoms unless such an intention is clearly manifested by unmistakable and unambiguous language. General words will rarely be sufficient for that purpose. What courts will look for is a clear indication that the legislature has directed its attention to the rights or freedoms in question, and has consciously decided upon abrogation or curtailment34. As Lord Hoffmann recently pointed out in the United Kingdom35, for Parliament squarely to confront such an issue may involve a political cost, but in the absence of express language or necessary implication, even the most general words are taken to be "subject to the basic rights of the individual"36. Thirdly, the Australian Constitution is framed upon the assumption of the rule of law37. Brennan J said38: "Judicial review is neither more nor less than the enforcement of the rule of law over executive action; it is the means by which executive action is prevented from exceeding the powers and functions assigned to the executive by law and the interests of the individual are protected accordingly." Fourthly, and as a specific application of the second and third principles, privative clauses are construed "by reference to a presumption that the legislature 33 Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 287 per Mason CJ and Deane J; see also Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 38 per Brennan, Deane and Dawson JJ. 34 Coco v The Queen (1994) 179 CLR 427 at 437 per Mason CJ, Brennan, Gaudron 35 R v Home Secretary; Ex parte Simms [2000] 2 AC 115 at 131. 36 See also Annetts v McCann (1990) 170 CLR 596 at 598 per Mason CJ, Deane and 37 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193 per 38 Church of Scientology v Woodward (1982) 154 CLR 25 at 70. does not intend to deprive the citizen of access to the courts, other than to the extent expressly stated or necessarily to be implied"39. Fifthly, a principle of relevance to Hickman is that what is required is a consideration of the whole Act, and an attempt to achieve a reconciliation between the privative provision and the rest of the legislation. In the case of the Act presently under consideration, that is a formidable task. There may not be a single answer to the question. But the task is not to be performed by reading the rest of the Act as subject to s 474, or by making s 474 the central and controlling provision of the Act. The Commonwealth's argument as to the effect of s 474, in its application to the proceedings contemplated by the plaintiff, is inconsistent with the above principles. In essence, the argument is that the amendment of the Act which introduced s 474 brought about a radical transformation of the pre-existing provisions. From that time, there were no "imperative duties", and no "inviolable limitations" on the powers and jurisdiction of decision-makers under the Act. When s 474 says that constitutional writs do not lie, it means that, subject to "the Hickman conditions", breaches of the Act do not involve jurisdictional error. The "Hickman conditions" are that a decision is a bona fide attempt to exercise power, that it relates to the subject matter of the legislation, and that is reasonably capable of reference to the power. Applying that to a decision to refuse a protection visa under s 65 of the Act, it will always necessarily relate to the subject matter of the legislation, it will always be reasonably capable of reference to power given to the decision-maker, and so long as it is a bona fide attempt to exercise the power conferred by s 65, all the conditions necessary for legally valid decision-making will have been satisfied. Australia's international protection obligations will be fulfilled by the executive government's bona fide attempt to fulfil them. The theory behind this argument appears to be that, in whatever statutory context it is found, a privative provision controls the meaning of the remainder of the statute, and, in the case of a conferral of jurisdiction upon a decision-maker, expands that jurisdiction in such a way that excess of jurisdiction will only occur in the event of a breach of one of the "conditions" mentioned. That is difficult to reconcile with the actual decision in Hickman. And, in the context of the Act, and decisions as to protection visas, it is impossible to reconcile with the principles of statutory construction stated above. 39 Public Service Association (SA) v Federated Clerks' Union (1991) 173 CLR 132 at 160 per Dawson and Gaudron JJ. As French J observed in NAAV v Minister for Immigration and Multicultural and Indigenous Affairs40, the Act is "replete with official powers and discretions, tightly controlled under the Act itself and under the Regulations by conditions and criteria to be satisfied before those powers and discretions can be exercised". In that case, and a number of related cases heard at the same time, the Full Court of the Federal Court dealt with several different kinds of challenge to decisions under the Act, and the operation of s 474 in relation to each of them. Here we are concerned with only one kind of challenge, involving a claim of denial of natural justice. A rejection of the Commonwealth's global approach to the operation of s 474 does not mean that the opposite conclusion follows in relation to every possible kind of challenge to a decision. The principles of statutory construction stated above lead to the conclusion that Parliament has not evinced an intention that a decision by the Tribunal to confirm a refusal of a protection visa, made unfairly, and in contravention of the requirements of natural justice, shall stand so long as it was a bona fide attempt to decide whether or not such a visa should be granted. Decision-makers, judicial or administrative, may be found to have acted unfairly even though their good faith is not in question. People whose fundamental rights are at stake are ordinarily entitled to expect more than good faith. They are ordinarily entitled to expect fairness. If Parliament intends to provide that decisions of the Tribunal, although reached by an unfair procedure, are valid and binding, and that the law does not require fairness on the part of the Tribunal in order for its decisions to be effective under the Act, then s 474 does not suffice to manifest such an intention. It follows that, in my view, if the Tribunal's decision in relation to the plaintiff was taken in breach of the rules of natural justice, as is alleged, then it is not within the scope of protection afforded by s 474. It is not, relevantly, a decision to which s 474 applies. Section 486A As to s 486A, three features of the section may be noted. First, it applies in relation to a "privative clause decision", which is defined in s 5 to mean a decision of the kind referred to in s 474(2). Secondly, the time limit commences to run from notification of the decision, which may be very different from the time when a person becomes aware of the circumstances giving rise to a possible challenge to the decision. Thirdly, the time limit must not be extended. Even on the Commonwealth's submissions as to the meaning and effect of s 474, there may be decisions which that section does not protect. A decision procured by a corrupt inducement would be an obvious instance. The inducement might not be 40 (2002) 193 ALR 449 at 542 [399]. discovered until a time later than 35 days after the notification of the decision. How does the legislation operate in such a case? That is not a question that arises in the present case. The Commonwealth contends that the meaning and effect of s 486A is that decisions of the kind described in s 474(2), unless challenged within the time limited by s 486A, are to be treated as valid and effective for all purposes, even if they are affected by error of a kind which, consistently with "the Hickman principles" would not be protected from judicial review by s 474. Thus, for example, if the Regulations in question in Hickman had included, not merely reg 17, but also a regulation in terms similar to s 486A, reg 17 would not defeat an application for prohibition but, if the time limit elapsed before proceedings were commenced, the additional regulation would bar the proceedings. That approach involves treating "decision ... under this Act" in s 474(2) as meaning "purported decision ... under this Act"; but if that were correct, it appears to leave no textual basis for the hypothesis that s 474 does not, of its own force, protect the decision from judicial review. Whatever term is used to describe, in a summary form, the kinds of error that expose a decision to judicial review, notwithstanding a privative provision, the process of statutory construction involved cannot lead to "decision" being read as "purported decision". If a decision is not treated as a "decision ... under this Act" for the purposes of s 474, it is not such a decision for the purposes of s 486A. It is to be noted that s 474 does not apply only to decisions that have been made. It also covers a failure or refusal to make a decision, conduct preparatory to the making of a decision, and other acts or omissions which may not involve something that is a purported decision, but not a decision under the Act. The operation of s 486A in such a case does not arise for decision. In the present case, s 486A will not operate in relation to a purported decision made in breach of the requirements of natural justice. Conclusion I would answer the questions in the case stated in the manner proposed in the joint judgment. McHugh Kirby Hayne GAUDRON, McHUGH, GUMMOW, KIRBY AND HAYNE JJ. The plaintiff commenced proceedings in this Court by writ of summons endorsed with his statement of claim. He contends that certain provisions of the Migration Act 1958 (Cth) ("the Act") are invalid. The provisions in question bear on his right to seek judicial review of a decision of the Refugee Review Tribunal ("the decision") affirming an earlier decision of the delegate of the Minister for Immigration and Multicultural and Indigenous Affairs refusing his application for a protection visa. By reason that he brings these proceedings in his capacity as a person who applied for a protection visa under s 36 of the Act, the plaintiff cannot be named by this Court41. After the defendant, the Commonwealth of Australia, filed its defence to the plaintiff's statement of claim, Gummow J stated a case for the consideration of the Full Court. At this stage, it is necessary only to note that the following is recorded in the case stated: "The Plaintiff asserts that he would have applied and would, but for sections 474 and 486A of the Migration Act 1958 (Cth), apply to the High Court for judicial review of and for relief in its original jurisdiction under section 75(v) of the Constitution of the decision." A draft Order Nisi attached to the case stated reveals that he would have challenged, or would challenge, the decision on the ground that it was reached in breach of the requirements of natural justice and would have sought, or would seek, relief by way of prohibition, certiorari and mandamus, but not by way of 41 Section 91X of the Act relevantly provides: "(1) This section applies to a proceeding before the High Court, the Federal Court or the Federal Magistrates Court if the proceeding relates to a person in the person's capacity as: (a) a person who applied for a protection visa; ... The court must not publish (in electronic form or otherwise), in relation to the proceeding, the person's name." In the absence of any direct challenge, it will be assumed that s 91X is constitutionally valid. injunction. Breaches of the requirements of natural justice found a complaint of jurisdictional error under s 75(v) of the Constitution42. Questions in the case stated By reference to the facts and matters therein set out, which are briefly recorded above, the following questions are asked in the case stated: "QUESTION 1 Is section 486A of the Migration Act 1958 (Cth) invalid in respect of an application by the Plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? QUESTION 2 Is section 474 of the Migration Act 1958 (Cth) invalid in respect of an application by the Plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? QUESTION 3 By whom should the costs of the proceeding in this Honourable Court be borne?" As the draft Order Nisi attached to the case stated does not claim injunctive relief, Questions 1 and 2 above should be answered by reference only to the writs of mandamus, certiorari and prohibition. Legislative provisions in issue Section 474 was inserted into the Act by Sched 1 of the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth) ("the Amending Act") which came into operation on 2 October 2001. That section relevantly provides: 42 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82. It is unnecessary in these proceedings to consider any consequences that may follow from the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth) which came into force, and applies to decisions made, after the decisions relevant to these proceedings. McHugh Kirby Hayne "(1) A privative clause decision: is final and conclusive; and (b) must not be challenged, appealed against, reviewed, quashed or called in question in any court; and is not subject declaration or certiorari in any court on any account. to prohibition, mandamus, injunction, In this section: privative clause decision means a decision of an administrative character made, proposed to be made, or required to be made, as the case may be, under this Act or under a regulation or other instrument made under this Act (whether in the exercise of a discretion or not), other than a decision referred to in subsection (4) (3) A reference in this section to a decision includes a reference to the following: granting, making, suspending, cancelling, revoking or refusing to make an order or determination; granting, giving, suspending, cancelling, revoking or refusing to give a certificate, direction, approval, consent or permission (including a visa); granting, refusing to issue an authority or other instrument; issuing, suspending, cancelling, revoking or imposing, or refusing to remove, a condition or restriction; (e) making or revoking, or refusing to make or revoke, a declaration, demand or requirement; retaining, or refusing to deliver up, an article; doing or refusing to do any other act or thing; conduct preparatory to the making of a decision, including the taking of evidence or the holding of an inquiry or investigation; a decision on review of a decision, irrespective of whether the decision on review is taken under this Act or a regulation or other instrument under this Act, or under another Act; a failure or refusal to make a decision." Sub-section (4) then sets out certain decisions that, for the purposes of s 474(2), are not privative clause decisions. And sub-s (5) permits the making of regulations specifying that particular decisions are not privative clause decisions. As will later appear, there may be a question whether the decision which the plaintiff wishes to challenge is a "privative clause decision" as defined in sub- ss (2) and (3) of the Act. However, if it is, it is common ground that neither sub- ss (4) nor (5) operates to take the decision outside of the definition in sub-ss (2) and (3) of s 474. Section 486A of the Act was amended by the Migration Legislation Amendment Act (No 1) 2001 (Cth) which came into operation on 27 September 2001 and by the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth), which came into operation on 2 October 2001. It now reads as follows: "(1) An application to the High Court for a writ of mandamus, prohibition or certiorari or an injunction or a declaration in respect of a privative clause decision must be made to the High Court within 35 days of the actual (as opposed to deemed) notification of the decision. The High Court must not make an order allowing, or which has the effect of allowing, an applicant to make an application mentioned in subsection (1) outside that 35 day period. The regulations may prescribe the way of notifying a person of a decision for the purposes of this section." The plaintiff was notified of the decision on 5 April 2002, more than 35 days before commencing these proceedings. The competing arguments with respect to s 474 of the Act Although it is the subject of the second question in the case stated, it is convenient to consider s 474 of the Act first. The argument advanced on behalf of the plaintiff is that par (c) of s 474(1) is directly inconsistent with s 75(v) of the Constitution which confers original jurisdiction on this Court "[i]n all matters McHugh Kirby Hayne ... in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth". That being so, it is said, s 474(1)(c) is invalid. Further, it is put that the other parts of s 474 are inseverable from sub-s (1)(c) and, thus, are also invalid. On behalf of the Commonwealth, it was conceded that s 474 cannot oust the jurisdiction which s 75(v) of the Constitution confers on this Court. That concession was properly made. It reflects what has been understood to be the position since the decision in The Tramways Case [No 1]43 given in 1914, and what follows is to be read with that starting point in mind. However, it was submitted that, when the Act is construed as a whole, s 474 does not have that effect and, thus, is not invalid. It will later be necessary to refer in some detail to the construction which, according to the submissions for the Commonwealth, should be placed on relevant provisions of the Act and the effect which s 474 is said to have on this Court's power to review decisions pursuant to s 75(v) of the Constitution. For the moment, however, it is sufficient to note that it is necessary to engage in a process of construction before the constitutional validity of s 474 can be considered. Section 474 of the Act; privative clauses generally The construction of legislation containing provisions such as s 474 of the Act has a particular, but not entirely satisfactory, history. For the moment, it is necessary to refer only to the decision in R v Hickman; Ex parte Fox and Clinton44. Doubtless because of that decision and, also, because of the terms of s 75(v) of the Constitution, the Commonwealth contends that s 474(1) is not to be construed as totally excluding judicial review. Moreover, it is clear that Parliament did not intend it to have that effect. So far as legislative intent is concerned, it is relevant to note that, in the second reading speech for the Bill that became the Amending Act which amended the Act so to include s 474, the Minister said: The privative clause does not mean that access to the courts is denied, nor that only the High Court can hear migration matters. Both the 43 R v The Commonwealth Court of Conciliation and Arbitration; Ex parte The Brisbane Tramways Company Limited (1914) 18 CLR 54. 44 (1945) 70 CLR 598. Federal Court and the High Court can hear migration matters, but the grounds of judicial review before either court have been limited."45 A little later, the Minister added: Members may be aware that the effect of a privative clause such as that used in Hickman's case is to expand the legal validity of the acts done and the decisions made by decision makers. The result is to give decision makers wider lawful operation for their decisions, and this means that the grounds on which those decisions can be challenged in the Federal and High Courts are narrower than currently."46 Of course, the Minister's understanding of the decision in Hickman cannot give s 474 an effect that is inconsistent with the terms of the Act as a whole47. In Hickman, a question arose as to the effect of reg 17 of the National Security (Coal Mining Industry Employment) Regulations 1941 (Cth), made under the National Security Act 1939 (Cth) and thus supported by the defence power. Regulation 17 provided that a decision of a Local Reference Board, which had a general power to settle disputes as to any local matter likely to affect the amicable relations of employers and employees in the coal mining industry48, "[should] not be challenged, appealed against, quashed or called into question, or be subject to prohibition, mandamus or injunction, in any court on any account whatever"49. Dixon J said of reg 17: 45 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 September 2001 at 31559. 46 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 September 2001 at 31561. 47 Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518 per Mason CJ, Wilson and Dawson JJ, 547 per Gaudron J. See also Mills v Meeking (1990) 169 CLR 214 at 223, 226 per Mason CJ and Toohey J; Hepples v Federal Commissioner of Taxation (1992) 173 CLR 492; Federal Commissioner of Taxation v Ryan (2000) 201 CLR 109 at 126 [29] per Gleeson CJ, Gummow and Hayne JJ. 48 Regulation 14. 49 Regulation 17. McHugh Kirby Hayne The particular regulation is expressed in a manner that has grown familiar. Both under Commonwealth law, and in jurisdictions where there is a unitary constitution, the interpretation of provisions of the general nature of reg 17 is well established. They are not interpreted as meaning to set at large the courts or other judicial bodies to whose decision they relate. Such a clause is interpreted as meaning that no decision which is in fact given by the body concerned shall be invalidated on the ground that it has not conformed to the requirements governing its proceedings or the exercise of its authority or has not confined its acts within the limits laid down by the instrument giving it authority, provided always that its decision is a bona fide attempt to exercise its power, that it relates to the subject matter of the legislation, and that it is reasonably capable of reference to the power given to the body."50 It should be noted at once that, in the passage last quoted, Dixon J was not speaking of reg 17, but of privative clauses generally. Even so, it is important to appreciate that his Honour's observations were confined to "decision[s] ... in fact given"51. Moreover and as later decisions of this Court have made clear, the expression "reasonably capable of reference to the power given to the body"52, has been treated as signifying that it must "not on its face go beyond ... power"53. Thus, even on this general statement, a privative clause cannot protect against a failure to make a decision required by the legislation in which that clause is found or against a decision which, on its face, exceeds jurisdiction. As to the effect of the privative clause actually considered in Hickman, Dixon J first noted that the Parliament could neither "give power to any judicial or other authority" in excess of constitutional power nor "impose limits upon the ... authority of a body ... with the intention that any excess of that authority means invalidity, and ... at the same time ... deprive this Court of authority to 50 (1945) 70 CLR 598 at 614-615. 51 (1945) 70 CLR 598 at 615. 52 (1945) 70 CLR 598 at 615. 53 R v Coldham; Ex parte Australian Workers' Union (1983) 153 CLR 415 at 418 per Mason ACJ and Brennan J quoting Kitto J in R v Commonwealth Conciliation and Arbitration Commission; Ex parte Amalgamated Engineering Union (Australian Section) (1967) 118 CLR 219 at 253. See also O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 at 287 per Deane, Gaudron and McHugh JJ. restrain the invalid action ... by prohibition."54 Rather, if legislation purports to impose limits on authority and contains a privative clause, it is, so his Honour said, "a question of interpretation of the whole legislative instrument whether transgression of the limits, so long as done bona fide and bearing on its face every appearance of an attempt to pursue the power, necessarily spells invalidity."55 And in that process, according to his Honour, an attempt should be made to "reconcile" the apparently conflicting legislative provisions56. The reconciliation of the conflicting provisions effected by Dixon J in Hickman was expressed in these terms: "the decisions of a Reference Board should not be considered invalid if they do not upon their face exceed the Board's authority and if they do amount to a bona fide attempt to exercise the powers of the Board and relate to the subject matter of the Regulations"57. In the result, prohibition issued with respect to the decision under challenge in that case as, on its face, it exceeded the Board's authority. It follows from Hickman, and it is made clear by subsequent cases58, that the so-called "Hickman principle" is simply a rule of construction allowing for the reconciliation of apparently conflicting statutory provisions. Once this is accepted, as it must be, it follows that there can be no general rule as to the meaning or effect of privative clauses. Rather, the meaning of a privative clause must be ascertained from its terms; and if that meaning appears to conflict with the provision pursuant to which some action has been taken or some decision made, its effect will depend entirely on the outcome of its reconciliation with that other provision. 54 (1945) 70 CLR 598 at 616. 55 (1945) 70 CLR 598 at 616. 56 (1945) 70 CLR 598 at 616. 57 (1945) 70 CLR 598 at 617. 58 See R v Coldham; Ex parte Australian Workers' Union (1983) 153 CLR 415; O'Toole v Charles David Pty Ltd (1991) 171 CLR 232; Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168 at 193-195 per Brennan J; Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602. McHugh Kirby Hayne Privative clauses and the process of reconciling legislative provisions It was said in R v Coldham; Ex parte Australian Workers' Union that, where there is an inconsistency between a privative clause and other statutory provisions: "The inconsistency is resolved by reading the two provisions together and giving effect to each. The privative clause is taken into account in ascertaining what the apparent restriction or restraint actually signifies in order to determine whether the situation is one in which prohibition lies."59 As a general statement, so much may be accepted. However, it provides little guidance as to the manner in which a privative clause is taken into account or the light it sheds on the restriction or restraint in question. On behalf of the Commonwealth, it was contended that s 474 should first be construed as meaning and intended to mean that decisions are protected so long as there has been a bona fide attempt to exercise the power in question, that they relate to the subject-matter of the legislation and are reasonably capable of reference to the power. Then it is said that, being a later provision than those by which particular powers are conferred, s 474 should be construed as impliedly repealing all limitations on those powers leaving only constitutional limitations and those which derive from s 474. In terms, the argument was that s 474 "enlarges the powers of decision-makers so that their decisions are valid so long as they comply with the three Hickman provisos". It might be thought that the first step of the argument for the Commonwealth finds some support in what was said by Dixon J in R v Murray; Ex parte Proctor60. In that case, his Honour said as to the reconciliation of apparently inconsistent legislative provisions: "The first step in such a process of interpretation is to apply to a [privative clause] provision ... the traditional or established interpretation which makes the protection it purports to afford inapplicable unless there has been an honest attempt to deal with a subject matter confided to the 59 (1983) 153 CLR 415 at 418 per Mason ACJ and Brennan J. 60 (1949) 77 CLR 387. tribunal and to act in pursuance of the powers of the tribunal in relation to something that might reasonably be regarded as falling within its province"61. A proper reading of what Dixon J said in Murray is not that a privative clause is construed as meaning that decisions are protected so long as they conform to "the three Hickman provisos". Rather, the position is that the "protection" which the privative clause "purports to afford"62 will be inapplicable unless those provisos are satisfied. And to ascertain what protection a privative clause purports to afford, it is necessary to have regard to the terms of the particular clause in question63. Thus, contrary to the submissions for the Commonwealth, it is inaccurate to describe the outcome in a situation where the provisos are satisfied as an "expansion" or "extension" of the powers of the decision-makers in question. There are other difficulties with the argument for the Commonwealth. The process of construction for which it contends is not a process of construing the legislation as a whole. It is a process which places a construction on one provision, the privative clause, and asserts that all other provisions may be disregarded. That process ignores what Dixon J said in Murray was a "second step in [the process of] interpreting the whole legislative instrument"64, namely: "to consider whether particular limitations on power and specific requirements as to the manner in which the tribunal shall be constituted or shall exercise its power are so expressed that they must be taken to mean that observance of the limitations and compliance with the requirements are essential to valid action."65 His Honour explained that: 61 (1949) 77 CLR 387 at 399-400. 62 (1949) 77 CLR 387 at 400. 63 See Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at 633-635 per Gaudron and Gummow JJ. 64 (1949) 77 CLR 387 at 400. 65 (1949) 77 CLR 387 at 400. McHugh Kirby Hayne "a clearly expressed specific intention of [that] kind can hardly give way to the general intention indicated by ... a [privative clause]"66. The importance of giving effect to express legislative provisions, notwithstanding the existence of a privative clause, is to be seen in Coldham67. In that case, it was contended that the privative clause contained in s 60(1) of the Conciliation and Arbitration Act 1904 (Cth) protected a decision under s 142A(1) of that Act. The latter provision authorised the making of an order that an organisation of employees should have the exclusive right to represent some or all of the industrial interests of a class or group of employees who were "eligible for membership of the organization"68. It was said by Mason ACJ and Brennan J that s 60 "[could not] affect the operation of a provision which impose[d] inviolable limitations or restraints upon ... jurisdiction or powers"69. In this regard, the requirement that persons be "eligible for membership of the organization" was said to be "quite explicit" and, thus, an inviolable jurisdictional restraint70. So far as it was contended on behalf of the Commonwealth that s 474 effected an implied repeal of statutory limitations on authority or powers conferred by the Act, the argument seeks to give s 474 an effect which was denied in Coldham and which exceeds anything that was said in Hickman. And because it exceeds anything that was said in Hickman, by reference to which the Minister explained the effect of s 474 in the second reading speech for the Bill that became the Amending Act, it is impossible to conclude that the Parliament intended to effect a repeal of all statutory limitations or restraints upon the exercise of power or the making of a decision. More fundamentally, the method of reconciliation by implied repeal of limitations or restraints in the Act on the exercise of power must be rejected because it seeks to give to s 474 a meaning which its terms cannot bear. It seeks to give to that section a meaning that is descriptive of a recognised limitation on 66 (1949) 77 CLR 387 at 400. 67 (1983) 153 CLR 415. 68 Conciliation and Arbitration Act 1904 (Cth), s 142A(1). 69 (1983) 153 CLR 415 at 419. 70 (1983) 153 CLR 415 at 419. the effectiveness of privative clauses generally and ignores the words of the section which, in terms, limit access to the courts. Accordingly, the argument that s 474 effected an implied repeal of all statutory limitations and restraints must be rejected. Although s 474 does not purport to effect a repeal of statutory limitations or restraints, it should be noted that it may be that, by reference to the words of s 474, some procedural or other requirements laid down by the Act are to be construed as not essential to the validity of a decision71. However, that is a matter that can only be determined by reference to the requirement in issue in a particular case. Of course, the process of reconciliation elaborated by Dixon J in Murray which may result in some procedural or other requirement being construed as not essential to the validity of an act or decision, is necessary only if there is an apparent conflict between the provisions which impose those requirements and the privative clause in question72. Thus, if reliance is placed on a privative clause, the first step must be to ascertain its meaning or, as Dixon J put it in Murray, to ascertain "the protection it purports to afford"73. Construction of s 474 of the Act There are two basic rules of construction which apply to the interpretation of privative clauses. The first, which applies in the case of privative clauses in legislation enacted by the Parliament of the Commonwealth, is that "if there is an opposition between the Constitution and any such provision, it should be resolved by adopting [an] interpretation [consistent with the Constitution if] that is fairly open."74 71 See Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168 at 180 per Mason CJ, 206-207 per Deane and Gaudron JJ. See also Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602. 72 See Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at 631, 634 per Gaudron and Gummow JJ. 73 (1949) 77 CLR 387 at 400. 74 R v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598 at 616 per Dixon J. See generally with respect to the rule that, if possible, legislative provisions should be construed conformably with the Constitution: Ex parte Walsh and Johnson; In (Footnote continues on next page) McHugh Kirby Hayne The second basic rule, which applies to privative clauses generally, is that it is presumed that the Parliament does not intend to cut down the jurisdiction of the courts save to the extent that the legislation in question expressly so states or necessarily implies75. Accordingly, privative clauses are strictly construed. Quite apart from s 75(v), there are other constitutional requirements that are necessarily to be borne in mind in construing a provision such as s 474 of the Act. A privative clause cannot operate so as to oust the jurisdiction which other paragraphs of s 75 confer on this Court, including that conferred by s 75(iii) in matters "in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party". Further, a privative clause cannot operate so as to allow a non-judicial tribunal or other non-judicial decision-making authority to exercise the judicial power of the Commonwealth76. Thus, it cannot confer on a non-judicial body the power to determine conclusively the limits of re Yates (1925) 37 CLR 36 at 61-62 per Knox CJ, 127 per Rich J, 138 per Starke J; Pidoto v Victoria (1943) 68 CLR 87 at 109 per Latham CJ; R v Director-General of Social Welfare (Vict); Ex parte Henry (1975) 133 CLR 369 at 374 per Gibbs J; Russell v Russell (1976) 134 CLR 495 at 542 per Mason J; Bourke v State Bank of New South Wales (1990) 170 CLR 276 at 291; Re Nolan; Ex parte Young (1991) 172 CLR 460 at 485-486 per Brennan and Toohey JJ; Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 339 per Brennan J; Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 501-503 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ; Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 10 per Brennan CJ, Dawson, Toohey, McHugh and Gummow JJ, 26 per Gaudron J; R v Hughes (2000) 202 CLR 535 at 556-557 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ, 560-561 [53] per Kirby J; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 494-495 [310] per Kirby J; Acts Interpretation Act 1901 (Cth), s 15A. 75 Public Service Association (SA) v Federated Clerks' Union (1991) 173 CLR 132 at 160 per Dawson and Gaudron JJ. See also Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602; Shergold v Tanner (2002) 76 ALJR 808 at 812 [27] per Gleeson CJ, McHugh, Gummow, Kirby and Hayne JJ; 188 ALR 302 76 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254; Attorney-General of the Commonwealth of Australia v The Queen (1957) 95 CLR its own jurisdiction. So much is clear from the observation of Mason ACJ and Brennan J in Coldham that they were "unable to perceive how the Commission could be given authority to determine conclusively the question [upon which its jurisdiction depended] consistently with its character as a body which does not exercise the judicial power of the Commonwealth."77 As previously indicated, it was argued on behalf of the plaintiff that s 474(1)(c) of the Act is directly inconsistent with s 75(v) of the Constitution. However, s 474(1)(c) cannot be read in isolation from the definition of "privative clause decision" in s 474(2). That definition relevantly confines "privative clause decision[s]" to decisions "made, proposed to be made, or required to be made ... under this Act". When regard is had to the phrase "under this Act" in s 474(2) of the Act, the words of that sub-section are not apt to refer either to decisions purportedly made under the Act or, as some of the submissions made on behalf of the Commonwealth might suggest, to decisions of the kind that might be made under the Act. Moreover, if the words of the sub-section were to be construed in either of those ways, s 474(1)(c) would be in direct conflict with s 75(v) of the Constitution and, thus, invalid. Further, they would confer authority on a non- judicial decision-maker of the Commonwealth to determine conclusively the limits of its own jurisdiction and, thus, at least in some cases, infringe the mandate implicit in the text of Ch III of the Constitution that the judicial power of the Commonwealth be exercised only by the courts named and referred to in Once it is accepted, as it must be, that s 474 is to be construed conformably with Ch III of the Constitution, specifically, s 75, the expression "decision[s] ... made under this Act" must be read so as to refer to decisions which involve neither a failure to exercise jurisdiction nor an excess of the jurisdiction conferred by the Act. Indeed so much is required as a matter of general principle. This Court has clearly held that an administrative decision which involves jurisdictional error is "regarded, in law, as no decision at all"78. Thus, if there has been jurisdictional error because, for example, of a failure to 77 (1983) 153 CLR 415 at 419. See also at 426-428 per Deane and Dawson JJ. 78 See Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 76 ALJR 598 at 606 [51] per Gaudron and Gummow JJ, 608 [63] per McHugh J, 624- 625 [152] per Hayne J; 187 ALR 117 at 129, 131, 154-155. McHugh Kirby Hayne discharge "imperative duties"79 or limitations or restraints"80, the decision in question cannot properly be described in the terms used in s 474(2) as "a decision ... made under this Act" and is, thus, not a "privative clause decision" as defined in ss 474(2) and (3) of the Act81. to observe "inviolable To say that a decision that involves jurisdictional error is not "a decision ... made under [the] Act" is not to deny that it may be necessary to engage in the reconciliation process earlier discussed to ascertain whether the failure to observe some procedural or other requirement of the Act constitutes an error which has resulted in a failure to exercise jurisdiction or in the decision-maker exceeding its jurisdiction. The effect of s 474 is to require an examination of limitations and restraints found in the Act. There will follow the necessity, if s 474 is constitutionally valid and if proceedings are brought by the plaintiff in accordance with the draft Order Nisi, to determine, in those proceedings, whether, as a result of the reconciliation process, the decision of the Tribunal does or does not involve jurisdictional error and, accordingly, whether it is or is not a "privative clause decision" as defined in s 474(2) of the Act. Constitutional validity of s 474 of the Act Before turning to the constitutional validity of s 474 of the Act in its application to the proceeding which the plaintiff would commence or would have commenced in respect of the decision of the Refugee Review Tribunal, it is important to note two matters with respect to s 75(v) of the Constitution. The 79 See R v Metal Trades Employers' Association; Ex parte Amalgamated Engineering Union, Australian Section (1951) 82 CLR 208 at 248 per Dixon J. See also Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at 632 per Gaudron and Gummow JJ. 80 R v Coldham; Ex parte Australian Workers' Union (1983) 153 CLR 415 at 419 per Mason ACJ and Brennan J. See also R v Metal Trades Employers' Association; Ex parte Amalgamated Engineering Union, Australian Section (1951) 82 CLR 208 at 248 per Dixon J; Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at 632 per Gaudron and Gummow JJ. 81 See Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at 635 per Gaudron and Gummow JJ. first is that that provision makes no mention of certiorari which lies to quash the decisions of inferior courts and tribunals for error of law on the face of the record82. Notwithstanding that s 75(v) does not refer to certiorari, it has long been accepted that certiorari may issue as ancillary to the constitutional writs of mandamus and prohibition83. However, following the decision in Re McBain; Ex parte Australian Catholic Bishops Conference, it must also be accepted that, subject to the existence of "a matter", certiorari may also issue in the exercise of jurisdiction conferred by s 75(iii) of the Constitution in "all matters ... in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party" and that conferred pursuant to s 76(i) of the Constitution "in any matter ... arising under [the] Constitution, or involving its interpretation"84. Thus it may be that, at least in some matters, judicial review of administrative decisions has not been and, in the absence of a privative clause having that effect, is not confined by the notion of jurisdictional error. As no constitutional provision confers jurisdiction with respect to certiorari, it is open to the Parliament to legislate so as to prevent the grant of such relief. However, because "privative clause decision" is relevantly defined in terms of a "decision ... made under [the] Act", s 474(1)(c) does not prevent the issue of certiorari as ancillary to mandamus or prohibition, but validly does so for non-jurisdictional error of law on the face of the record. 82 See R v Cook; Ex parte Twigg (1980) 147 CLR 15 at 32 per Aickin J; R v Marshall; Ex parte Federated Clerks Union of Australia (1975) 132 CLR 595 at 609 per Mason J; O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 at 270 per Brennan J; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 90- 91 [14] per Gaudron and Gummow JJ; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 76 ALJR 694 at 725 [165] per Kirby J; 188 ALR 1 at 83 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 90-91 [14] per Gaudron and Gummow JJ; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 76 ALJR 694 at 699 [19] per Gleeson CJ, 705 [55] per Gaudron and Gummow JJ, 727 [176] per Kirby J; 188 ALR 1 at 8, 15-16, 46-47. 84 (2002) 76 ALJR 694; 188 ALR 1. McHugh Kirby Hayne The other aspect of s 75(v) that should be noted is its conferral of jurisdiction in matters in which "an injunction is sought against an officer of the Commonwealth". Given that prohibition and mandamus are available only for jurisdictional error85, it may be that injunctive relief is available on grounds that are wider than those that result in relief by way of prohibition and mandamus. In any event, injunctive relief would clearly be available for fraud, bribery, dishonesty or other improper purpose. The Hickman requirement that a decision be made bona fide presumably has the consequence that s 474 permits review in all such cases86. If it does not, there must, to that extent, be a real question as to the constitutional validity of s 474. However, as the draft Order Nisi indicates that relief would be or would have been sought only by way of prohibition, certiorari and mandamus, those questions need not now be explored. Because, as this Court has held, the constitutional writs of prohibition and mandamus are available only for jurisdictional error and because s 474 of the Act does not protect decisions involving jurisdictional error, s 474 does not, in that regard conflict with s 75(v) of the Constitution and, thus, is valid in its application to the proceedings which the plaintiff would initiate. The plaintiff asserts jurisdictional error by reason of a denial to him of procedural fairness and thus s 474, whilst valid, does not upon its true construction protect the decision of which the plaintiff complains. A decision flawed for reasons of a failure to comply with the principles of natural justice is not a "privative clause decision" within s 474(2) of the Act. Section 486A of the Act: the competing arguments The first contention of the plaintiff with respect to s 486A of the Act was that it was inseverable from s 474 and that, as the latter provision was wholly invalid, s 486A was also invalid. As s 474 is not wholly invalid, that argument must fail. The second argument was that the effect of s 486A is to abrogate, at least in some cases, the jurisdiction which s 75(v) of the Constitution confers on 85 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82. 86 cf O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 at 286-287 per Deane, Gaudron and McHugh JJ where the view was expressed that the question of bona fides is to be determined solely by reference to the record and not by reference to subjective considerations. Dawson J at 305 and Toohey J at 309 expressed the view that the question of bona fides is to be determined by reference to considerations personal to the decision-maker. this Court and that it is therefore invalid. By way of refinement of the latter argument, it was put that a time limit upon the commencement of proceedings under s 75(v) of the Constitution is invalid unless provision is made for the Court to extend the time in which proceedings may be brought. It was argued for the Commonwealth that s 486A merely imposes time limits upon the invocation of this Court's jurisdiction and that such a law is incidental to the legislative power conferred by ss 51(xix)87, (xxvii)88 and (xxix)89 or is within the express incidental power conferred by s 51(xxxix) of the Constitution with respect to "matters incidental to the execution of any power vested by this Constitution ... in the Federal Judicature". Construction of s 486A of the Act Before turning to the constitutional validity of s 486A, it is important to note that it applies only to a "privative clause decision", which is defined in s 5(1) of the Act, unless the contrary intention appears, to have "the meaning given by subsection 474(2)." As already indicated, s 474(2) of the Act requires that the decision in question be "made under [the] Act", and, thus, a decision involving jurisdictional error is not a privative clause decision for the purposes of that sub-section. If the expression "privative clause decision" in s 486A is given the meaning assigned by s 474(2) of the Act, it follows from what has been said earlier that s 486A will not apply to a "decision" when there has been jurisdictional error. That "decision" would not be a decision "made under [the] Act". On that construction of s 486A, no question of constitutional validity would arise in relation to applications for prohibition, mandamus or certiorari in respect of "decisions" where there has been jurisdictional error. Those applications would not be applications "in respect of a privative clause decision". Of course, that may not be so if injunctive relief is sought on the grounds of fraud, dishonesty or other improper purpose. 87 Section 51(xix) confers legislative power with respect to "naturalization and aliens". 88 Section 51(xxvii) confers legislative power with respect to "immigration and emigration". 89 Section 51(xxix) confers legislative power with respect to "external affairs". McHugh Kirby Hayne It must be recognised that a consequence of adopting this construction would be that it would be impossible to determine whether s 486A had operation in any particular case until it had been decided whether or not the decision in question involved jurisdictional error. Further, not only would the operation of s 486A depend upon the outcome of the application for relief, s 486A would, on this construction of its reference to privative clause decision, serve no useful purpose. If the decision did involve jurisdictional error s 486A would not apply; if it did not, s 474 would prevent the grant of relief. Even so, s 486A should not be read as revealing an intention contrary to the requirement of s 5 of the Act that "privative clause decision" has the meaning given by s 474(2). In particular, s 486A should not be read as using "privative clause decision" with a meaning that extends to decisions apparently or purportedly made under the Act other than those which are the subject of ss 474(4) or (5). As was said in Project Blue Sky Inc v Australian Broadcasting Authority90, "the duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have". Seldom will a construction that gives a provision no useful work to do achieve that end. In the present case, however, s 486A, if valid in that regard, may still have useful work to do if injunctive relief is sought. Moreover and so far as concerns prohibition, mandamus and certiorari, it is essential to recognise and give due weight to the fact that the provisions of the Act about privative clause decisions were intended to operate by giving effect to a particular view of the effect of what was decided in Hickman, Murray and other decisions of this Court. As has been pointed out earlier in these reasons, that view of the effect of those decisions is wrong. It is wrong because it seeks to treat "the three Hickman provisos" as if they were the only limits upon the power of those who made privative clause decisions under the Act. But the three Hickman provisos qualify the "protection it [the privative clause] purports to afford"91, not the powers of those who make privative clause decisions. The fundamental premise for the legislation being unsound it is, then, not surprising that s 486A should have no work to do in relation to the constitutional writs. No question of its validity 90 (1998) 194 CLR 355 at 384 [78] per McHugh, Gummow, Kirby and Hayne JJ. 91 R v Murray; Ex parte Proctor (1949) 77 CLR 387 at 400 per Dixon J. arises in that regard. And as the plaintiff would only seek relief by way of constitutional writ, it is unnecessary to consider the issues that might arise in relation to injunctive relief, in respect of which s 486A could, if necessary, be read down to bring it within constitutional limits. The decision in this case The result is that neither s 474 or s 486A, upon their proper construction, bars or limits the exercise of the jurisdiction of this Court which the applicant seeks to invoke in respect of his proposed Order Nisi. The Amending Act introduced a new Pt 8 (ss 474-484). The legislation was further amended by the Jurisdiction of the Federal Magistrates Service Legislation Amendment Act 2001 (Cth). This introduced s 483A, conferring upon the Federal Magistrates Court the same jurisdiction as the Federal Court in relation to matters arising under the Act. Section 476(1) provides: "Despite any other law (including section 483A, sections 39B and 44 of the Judiciary Act 1903 ['the Judiciary Act'], section 32AB of the Federal Court of Australia Act 1976 and section 39 of the Federal Magistrates Act 1999), the Federal Court and the Federal Magistrates Court do not have any jurisdiction in relation to a primary decision." The term "primary decision" is so defined in s 476(6) as to apply to classes of the privative clause decisions identified in s 474. Section 39B of the Judiciary Act, subject to certain qualifications, confers upon the Federal Court jurisdiction of the character of that of this Court under s 75(v) of the Constitution. Section 44 provides for remitter by this Court. The other two provisions identified in s 476(1) of the Act provide for the discretionary transfer of proceedings between the Federal Court and the Federal Magistrates Court. Section 476(4) requires the High Court not to remit a matter to either of those other federal courts if it relates to a decision or matter in respect of which those courts, by reason of s 476, would not have jurisdiction. The construction given in these reasons to the term "privative clause decision" in s 474 is significant, in particular for the operation of s 483A of the Act, and ss 39B and 44 of the Judiciary Act. The limitation, by the adaptation of the term "privative clause decision", of the jurisdiction otherwise enjoyed by the Federal Court and Federal Magistrates Court, and the limitation upon the power of this Court under s 44 of the Judiciary Act, will be controlled by the construction given to s 474. McHugh Kirby Hayne Decisions which are not protected by s 474, such as that in this case, where jurisdictional error is relied upon, will not be within the terms of the jurisdictional limitations just described; jurisdiction otherwise conferred upon federal courts by the laws specified in s 476(1) in respect of such decisions will remain, to be given full effect in accordance with the terms of that conferral. It also is to be noted that changes were made by the Amending Act to the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act"). The Amending Act inserted par (da) in Sched 1 to the ADJR Act. Section 3(1) of the ADJR Act contains a definition of "decision to which this Act applies", which identifies decisions of an administrative character made, proposed to be made or required to be made under certain enactments, but excluding decisions included in any of the classes of decision set out in Sched 1. The par (da) of Sched 1 inserted by the Amending Act specifies: "a privative clause decision within the meaning of subsection 474(2) of the Migration Act 1958". Questions may arise respecting the construction of the ADJR Act and its application to decisions which are not privative clause decisions and in which jurisdictional error is relied upon. No arguments were directed to any such questions and we say no more on the subject. General principles It is important to emphasise that the difference in understanding what has been decided about privative clauses is real and substantive; it is not some verbal or logical quibble. It is real and substantive because it reflects two fundamental constitutional propositions, both of which the Commonwealth accepts. First, the jurisdiction of this Court to grant relief under s 75(v) of the Constitution cannot be removed by or under a law made by the Parliament. Specifically, the jurisdiction to grant s 75(v) relief where there has been jurisdictional error by an officer of the Commonwealth cannot be removed. Secondly, the judicial power of the Commonwealth cannot be exercised otherwise than in accordance with Ch III. The Parliament cannot confer on a non-judicial body the power to conclusively determine the limits of its own jurisdiction. To understand the three Hickman provisos as qualifying the powers of those who make privative clause decisions, rather than qualifying the protection which the privative clause affords, either assumes that the Act on its true construction provides no other jurisdictional limitation on the relevant decision making or other power or it assumes that the repository of the power can decide the limits of its own jurisdiction. For the reasons given earlier, the first assumption is wrong. The alternative assumption would contravene Ch III. In submissions it was put by the Commonwealth that the reasoning in Hickman produced, as a matter of judicial interpretation of privative clauses, a result which might have been achieved by adoption of a legislative stipulation for the expansion of decision-making powers under the Act up to the boundaries of designated heads of power in s 51 of the Constitution. It has been explained earlier in these reasons that Hickman does not have such an operation. But something more should be said respecting the employment of a legislative device for the "reading up" of decision-making powers conferred upon the Executive branch of government. In argument, the Commonwealth suggested that the Parliament might validly delegate to the Minister "the power to exercise a totally open-ended discretion as to what aliens can and what aliens cannot come to and stay in Australia", subject only to this Court deciding any dispute as to the "constitutional fact" of alien status. Alternatively, it was put that the Act might validly be redrawn to say, in effect, "[h]ere are some non-binding guidelines which should be applied", with the "guidelines" being the balance of the statute. Other variations were canvassed. The inclusion in the Act of such provisions to the effect that, notwithstanding anything contained in the specific provisions of that statute, the Minister was empowered to make any decision respecting visas, provided it was with respect to aliens, might well be ineffective. It is well settled that the structure of the Constitution does not preclude the Parliament from authorising in wide and general terms subordinate legislation under any of the heads of its legislative power. Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan92 may be cited for that proposition. But what may be "delegated" is the power to make laws with respect to a particular head in s 51 of the Constitution. The provisions canvassed by the Commonwealth would appear to lack that hallmark of the exercise of legislative power identified by Latham CJ in The Commonwealth v Grunseit93, namely, the determination of "the content of a law as a rule of conduct or a declaration as to power, right or duty". Moreover, 92 (1931) 46 CLR 73. 93 (1943) 67 CLR 58 at 82. McHugh Kirby Hayne there would be delineated by the Parliament no factual requirements to connect any given state of affairs with the constitutional head of power94. Nor could it be for a court exercising the judicial power of the Commonwealth to supply this connection in deciding litigation said to arise under that law. That would involve the court in the rewriting of the statute, the function of the Parliament, not a Ch III court95. Finally, the issues decided in these proceedings are not merely issues of a technical kind involving the interpretation of the contested provisions of the Act. The Act must be read in the context of the operation of s 75 of the Constitution. That section, and specifically s 75(v), introduces into the Constitution of the Commonwealth an entrenched minimum provision of judicial review. There was no precise equivalent to s 75(v) in either of the Constitutions of the United States of America or Canada. The provision of the constitutional writs and the conferral upon this Court of an irremovable jurisdiction to issue them to an officer of the Commonwealth constitutes a textual reinforcement for what Dixon J said about the significance of the rule of law for the Constitution in Australian Communist Party v The Commonwealth96. In that case, his Honour stated that the Constitution: "is an instrument framed in accordance with many traditional conceptions, to some of which it gives effect, as, for example, in separating the judicial power from other functions of government, others of which are simply assumed. Among these I think that it may fairly be said that the rule of law forms an assumption."97 94 cf Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 262 per 95 Bank of NSW v The Commonwealth ("the Bank Nationalisation Case") (1948) 76 CLR 1 at 164 per Latham CJ, 252 per Rich and Williams JJ, 371-372 per Dixon J; Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 at 494 per Barwick CJ, 503-504 per Menzies J, 520 per Walsh J; Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373 at 485-486. 96 (1951) 83 CLR 1 at 193; cf Kartinyeri v Commonwealth (1998) 195 CLR 337 at 381 [89] per Gummow and Hayne JJ. 97 (1951) 83 CLR 1 at 193. The reservation to this Court by the Constitution of the jurisdiction in all matters in which the named constitutional writs or an injunction are sought against an officer of the Commonwealth is a means of assuring to all people affected that officers of the Commonwealth obey the law and neither exceed nor neglect any jurisdiction which the law confers on them. The centrality, and protective purpose, of the jurisdiction of this Court in that regard places significant barriers in the way of legislative attempts (by privative clauses or otherwise) to impair judicial review of administrative action. Such jurisdiction exists to maintain the federal compact by ensuring that propounded laws are constitutionally valid and ministerial or other official action lawful and within jurisdiction. In any written constitution, where there are disputes over such matters, there must be an authoritative decision-maker. Under the Constitution of the Commonwealth the ultimate decision-maker in all matters where there is a contest, is this Court. The Court must be obedient to its constitutional function. In the end, pursuant to s 75 of the Constitution, this limits the powers of the Parliament or of the Executive to avoid, or confine, judicial review. Answers to questions in the case stated Question 1 should be answered: "Upon its proper construction, s 486A does not apply to the proceedings the plaintiff would initiate. No question of the validity of s 486A arises in that regard." Question 2 should be answered: "Section 474 would be invalid if, on its proper construction, it attempted to oust the jurisdiction conferred on the High Court by s 75(v) of the Constitution. However, on its proper construction, it does not attempt to do so. Section 474 is valid but does not apply to the proceedings the plaintiff would initiate." Although Questions 1 and 2 have been answered against the plaintiff, the submissions made on behalf of the Commonwealth have been rejected in significant measure. Accordingly, Question 3 should be answered: "The Commonwealth will pay 75 per cent of the costs of the plaintiff of the proceedings and otherwise there is no order as to costs." Callinan Introduction Constitutional law in a federal system has been described as "a unique mixture of history, statutory interpretation, and some political philosophy"98. In resolving this case, resort to each of these is necessary: history for an understanding of the law in relation to prerogative writs at the time of Federation and the considerations which moved the founders to use the language that they did in ss 51(xxix) and (xxxvii), and Ch III of the Constitution; statutory interpretation to construe both the provisions of the enactment under challenge, and the Constitution which is both the source of the power to enact them, and the instrument which prescribes the powers conferred on this Court to examine and pronounce upon their validity; and, political philosophy for an understanding of the need for each of the arms of government, the Parliament, the Executive and the judiciary to pay due deference to, and not to intrude upon the roles of one another, in the good, that is to say the lawful and efficient government of the nation. This last-mentioned objective has as one of its sources the introductory words of s 51 of the Constitution which provide that "The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to" the enumerated matters. (emphasis added) The particular question that the case raises is whether ss 474 and 486A of the Migration Act 1958 (Cth) ("the Migration Act") are invalid. The matter comes before the Court after the institution of proceedings by the plaintiff in the original jurisdiction of the Court and following the statement of a case by one of its Justices in these terms: "PURSUANT TO section 18 of the Judiciary Act 1903 (Cth), the following facts are stated and the following questions reserved for the consideration of the Full Court: Agreed Statement of Facts The Plaintiff is a non-citizen of Australia who arrived in Australia on 7 March 1997. The Defendant is the Commonwealth of Australia. … On 2 April 1997, the Plaintiff applied for a Subclass 866 (Protection) visa on the asserted ground that he was a person to 98 Menzies, Afternoon Light, (1967) at 320. Callinan whom Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol. A delegate of [the Minister for Immigration and Multicultural and Indigenous Affairs] the Plaintiff's application and subsequently the Refugee Review Tribunal affirmed that decision. refused The Plaintiff filed an application for review of the Refugee Review Tribunal's decision in the Federal Court on 4 July 2000. On 31 July 2000, by consent, the Federal Court set aside the decision of the Refugee Review Tribunal and remitted the matter to the Refugee Review Tribunal to be determined according to law. On 6 March 2002, a differently constituted Refugee Review Tribunal made a decision (hereinafter referred to as 'the decision') affirming the original decision of the delegate not to grant the Plaintiff a Subclass 866 (Protection) visa. … The Refugee Review Tribunal handed down the decision on 28 March 2002. The decision was received by the Plaintiff on 5 April 2002. The Plaintiff asserts that he would have applied and would, but for sections 474 and 486A of the Migration Act 1958 (Cth), apply to the High Court for judicial review of and for relief in its original jurisdiction under section 75(v) of the Constitution of the decision. HAVING REGARD TO the facts and matters stated in the preceding paragraphs, the following questions are reserved for the consideration of the Full Court: QUESTION 1 Is section 486A of the Migration Act 1958 (Cth) invalid in respect of an application by the Plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? QUESTION 2 Is section 474 of the Migration Act 1958 (Cth) invalid in respect of an application by the Plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? Callinan QUESTION 3 By whom should the costs of the proceeding in this Honourable Court be borne?" The plaintiff has also filed a draft order nisi which sets out the grounds upon which he would challenge, if he may, the decision of the Refugee Review Tribunal: in substance that it was made in breach of the rules of natural justice, in consequence of which prohibition, certiorari and mandamus (but not an injunction) should go to render it ineffective. It is unnecessary at this stage of the proceeding to explore the merits of that ground except to say that a breach of those rules of sufficient gravity may be capable of amounting to jurisdictional error. Early and current migration legislation and decisions made under it As the expression that s 474 itself uses ("privative clause") indicates, it is such a provision and accordingly one which courts will construe "by reference to a presumption that the legislature does not intend to deprive the citizen of access to the courts, other than to the extent expressly stated or necessarily to be implied"99. That does not mean however that courts are, or should be the only decision makers, or indeed the final decision makers in our society in all matters. The vast majority of decisions with a capacity to affect citizens' prosperity and lives are made by administrators exercising statutory powers and performing statutory duties or functions. It will therefore be important to note that the definition of a "privative clause decision"100 includes the words "a decision of an administrative character". It also includes, it should be noted "a decision … proposed to be made" which I take to mean a decision intended to be made because that is the meaning the words apparently bear, and because "proposed" ought to be given a different meaning from "required" which is also used. The decision which the plaintiff would wish to challenge here is a decision of an administrative character. It is a decision of a kind that may properly be made by a member of the Executive. It is not a judicial decision, and, but for s 75 of the Constitution and other provisions of the Migration Act itself, might be able to be put beyond the reach of scrutiny by the courts. It is not necessary to examine this question in detail but it should not be overlooked that migration is fundamentally a matter for the Parliament and the Ministers and officials upon whom the Parliament chooses to confer duties and powers of administering enactments to deal with it. There is no 99 Public Service Association (SA) v Federated Clerks' Union (1991) 173 CLR 132 at 160 per Dawson and Gaudron JJ. Callinan qualification upon the legislative powers of the Parliament with respect to external affairs, immigration and aliens. This is not surprising, particularly so far as immigration and aliens are concerned, not simply because of the strong views held on these topics at the time of Federation, but also because every nation insists upon the right to determine who may enter the country, who may remain in it, who may become one of its citizens, and who may be liable to deportation101. The views of the founders with respect to immigration were given very early legislative voice by the 17th enactment of the first Parliament of Australia, the Immigration Restriction Act 1901 (Cth). Section 3 of that Act notoriously made provision for the imposition of a dictation test in any European language directed by any officer appointed under it, or any officer of customs, failure of which would result in a denial of entry to Australia, as would the formation of an opinion by the Minister that a person would be likely to become a charge upon the public or charity. Little changed until the Second World War and the displacement of millions of people of many nations both during and after it. Those dreadful events led to the adoption of the Convention relating to the Status of Refugees102 by many nations, and to which Australia was an original signatory. Australia did not, however, receive that Convention into its own law until 1994 by the insertion in that year of s 36 into the Migration Act103. Although major changes were made with respect to the laws governing immigration by the enactment of the Migration Act, s 6 of that Act provided that an immigrant who did not hold an entry permit on entering Australia was a prohibited entrant, and by s 7, that the Minister might "in his absolute discretion" cancel a temporary entry permit at any time. Chapter III of the Constitution apart, almost entirely, entry to, and presence in Australia were matters of unreviewable Executive discretion104. 101 Pochi v Macphee (1982) 151 CLR 101 at 106 per Gibbs CJ speaking with respect to deportation of aliens. See also Ferrando v Pearce (1918) 25 CLR 241 at 253 per 102 UNTS 2545 done at Geneva 22 April 1954. See also the Protocol relating to the Status of Refugees done at New York on 31 January 1967. 103 Section 36 was inserted in the Migration Act by the Migration Legislation Amendment Act 1994 (Cth). 104 As an example of one of the minor exceptions, a person, arrested without warrant on a reasonable supposition of being a prohibited migrant might seek a review of his apparently prohibited status by a prescribed authority appointed by the Minister pursuant to ss 38 to 40 of the Migration Act as enacted in 1958. Callinan The first Act dealing with immigration, the Immigration Restriction Act contained only 19 sections. The Migration Act as enacted in 1958 contained 67 substantive sections and a schedule. The brevity of these enactments provides a clear indication of the fewer decisions which fell to be made under those earlier Acts, the absolute and generally final nature of those decisions, and the different understanding and policy that the community, its parliamentary representatives and the Executive had and pursued with respect to their intention and entitlement to determine effectively and conclusively who might enter and live in the country. The reasoning and decision of the Justices of this Court (Barwick CJ, Gibbs and Aickin JJ; Stephen, Jacobs and Murphy JJ dissenting) in Salemi v MacKellar [No 2] also form part of the history to which I have referred. Those Justices were of the clear view that the Minister might issue a deportation order under the Migration Act as enacted in 1958 without first giving the person proposed to be deported an opportunity to be heard105. But it is not only understandings, opinions and policies with respect to human rights that have changed since Federation, particularly after 1945. Much of the post-colonial and other parts of the world are racked with internal dissension. It has become increasingly difficult to distinguish between economic refugees and refugees genuinely in fear of persecution. Equally, it is frequently difficult to determine whether people in some countries in which either there has been a breakdown in law and order, or in which law and order as we understand them have never existed, are persecuted persons, or whether they are themselves living in a traditionally aggressive and divided community unaccustomed to democracy or other forms of modern political discourse106. Minds will differ as to whether distinctions of the kind to which I have referred can or should be made. Some would take the view that morality and humanitarianism hold that they are irrelevant. As to this, only Parliament can, and must decide. Despite the Universal Declaration of Human Rights, itself still in many respects an aspirational rather than an effective and enforceable instrument, there is not unanimity throughout the world, and perhaps even in Australia as to what claims, practices, benefits and values are deserving of protection. And even with respect to those about which there is a large measure of agreement, views about their timing, identification and enforcement are unlikely to be unanimous. Speaking of access to human rights in the debate about the Declaration of the Rights of the 105 Salemi v MacKellar [No 2] (1977) 137 CLR 396 at 400-403 per Barwick CJ, 419- 421 per Gibbs J, 460 per Aickin J. 106 cf Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82. Callinan Man and the Citizen of 1789, Malouet was concerned with what was realistic and practical as opposed to the unattainable107: "Why then start by taking him to a high mountain, and showing him his empire without limits, when on coming down he will find limits at every step?" In modern times, the sorts of limits to which Malouet referred have not disappeared. Governments and parliaments are not free agents. They represent the will of the people. They are confronted by the day to day necessities of deciding how resources will be allocated, and, relevantly, how many opportunities, and at what levels, and in what tribunals and courts, applicants for the status of refugees should have to establish that entitlement. Those responsible for these matters will also be aware that there is not uniformity of approach by nations to these questions, and that in practice it will be more difficult in some countries to enter and remain in the community as a refugee than in others108. I do not, by referring to these matters mean to suggest that they govern the meaning and operation of the Constitution and enactments under it. I refer to them for the purpose of demonstrating the essential differences between the exercise of Executive and Judicial power. Politics largely shapes the former. The Constitution recognizes, indeed gives effect to that reality by providing for elections and the consequences of them, legislation and its implementation by Executive action. This Court must find and apply the law. But in so doing it cannot, in the Constitutional sphere be blind to the fact that realities and exigencies do confront government, realities and exigencies of a kind which must have been operating on the mind of Parliament in enacting the Migration Act. The Court is bound to answer the question which this case raises, on the basis that the Parliament has sought to reduce, so far as it lawfully, that is to say constitutionally can, challenge to administrative decisions about matters upon which it should be better informed and the Executive better equipped to deal than 107 "Pourquoi donc commencer par le transporter sur une haute montagne, et lui montrer son empire sans limites, lorsqu'il doit en descendre pour trouver des bornes à chaque pas?" Malouet, Archives Parlementaires, viii, at 322-323. 108 In England, for example, the rights of review and appeal, the latter by leave "on a question of law material to [the] determination" for which ss 58 and 59 and Sched 4, Pt III, s 23(1) of the Immigration and Asylum Act 1999 (UK) make provision. The United States amendments to the Immigration and Nationality Act of 1952 made by the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 which are designed to curtail the scope of judicial review (usually sought under the due process provisions of the United States Constitution (5th amendment)). Callinan this Court. If the Parliament, and the Executive which no doubt moved it are wrong about the subject matter and purposes of the Migration Act, then that is for the electorate to say and not the courts. Whether the confrontation of issues of those kinds is worth the political cost involved is for the politicians and not the courts. What the courts, including this one have to decide is whether the Migration Act can lawfully achieve either wholly or in part what the Parliament has set out to achieve, a question which has to be answered having regard to the settled principle that only clear words will suffice to defeat uncontestable human rights, and that privative clauses are therefore generally strictly construed. It remains important however to keep in mind that the challenge here at this stage of the proceeding is to the will of Parliament expressed by an enactment, and not just to an administrative or Executive decision. The meaning and operation of s 75(v) of the Constitution For reasons which will appear each of the remedies for which s 75(v) of the Constitution makes provision require some separate treatment. Section 75 provides as follows: "Original jurisdiction of High Court In all matters – Arising under any treaty: (ii) Affecting consuls or other representatives of other countries: (iii) In which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party: (iv) Between States, or between residents of different States, or between a State and a resident of another State: In which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth: the High Court shall have original jurisdiction." Certiorari unavailable as of right under s 75(v) of the Constitution The passage from Mr Barton's speech during the Convention Debates on 4 March 1898 which the Chief Justice quotes in his judgment109 shows that Mr Barton's, and, no doubt, other founders' concerns were with errors of a 109 Reasons of the Chief Justice at [5]. Callinan jurisdictional kind and not other errors of law. It can have been no accident therefore that certiorari was omitted (and injunction was included) as a remedy available to the High Court in its original jurisdiction under s 75(v). Elsewhere in the debates about the clause, none of the founders seems even to have suggested that the former should be included, or offered any reason why, on the other hand, injunction should be110. Perhaps, as Quick and Garran suggest111, and as will appear I believe to be the case, the latter was thought relevantly to be a synonym in context for either mandamus or prohibition. The omission of any reference to certiorari in s 75(v) can, in my opinion, only be explained by the desire of the founders to confine the remedies available under it strictly to jurisdictional error. Although it is true that in the last century, in the United Kingdom and Australia, until about 1952, certiorari had tended to be granted to cure jurisdictional error only, earlier and contemporary authority with which the founders would have been familiar, made it plain that error on the face of the record, within jurisdiction, was within its reach. Denning LJ in 1951 in R v Northumberland Compensation Appeal Tribunal; Ex parte Shaw, discussed the recent history of the writ until that time although his Lordship may have overestimated the duration of its desuetude112: "Of recent years the scope of certiorari seems to have been somewhat forgotten. It has been supposed to be confined to the correction of excess of jurisdiction, and not to extend to the correction of errors of law; and several judges have said as much. But the Lord Chief Justice has, in the present case, restored certiorari to its rightful position and shown that it can be used to correct errors of law which appear on the face of the record, even though they do not go to jurisdiction. I have looked into the history of the matter, and find that the old cases fully support all that the Lord Chief Justice said. Until about 100 years ago, certiorari was regularly used to correct errors of law on the face of the record. It is only within the last century that it has fallen into disuse, and that is only because there has, until recently, been little occasion for its exercise. Now, with the advent of many new tribunals, and the plain need for 110 See, for instance, Official Record of the Debates of the Australasian Federal Convention, (Melbourne) 31 January 1898, vol 1 at 349, and Official Record of the Debates of the Australasian Federal Convention, (Melbourne), 4 March 1898, vol 2 at 1894. 111 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 112 [1952] 1 KB 338 at 348. Callinan supervision over them, recourse must once again be had to this well-tried means of control."113 Late 19th century jurisprudence in the United States with which the founders would also have been likely to be familiar acknowledged the greater reach of the remedy. In the United States, in 1886, Hawes wrote this of it114: "The common-law writ of certiorari was used for the purpose of bringing the record of an inferior court or jurisdiction after judgment before a Superior Court, to ascertain whether the inferior tribunal had acted without jurisdiction, or having jurisdiction had proceeded illegally and contrary to the course of the common law …" (footnotes omitted) It can therefore be safely assumed that the authors of the Constitution drafted it with a full consciousness of the historical reach of all of the prerogative writs. They were unlikely to have foreseen however the increasing role and importance of administrative law, and the extension of the reach of the prerogative remedies, for example, to correct "unreasonableness"115 on the part of decision makers as discerned by the courts granting the remedy. Each section of Ch III of the Constitution, and indeed each of its chapters generally, including that dealing with the powers of the Executive, must have been drawn with a full awareness of the reach of the prerogative writs, contemporary and historical116. The founders would also have been concerned to ensure that the courts not unduly encroach upon the realm of the Executive in making administrative decisions unless the Executive refused to exercise its powers, or sought to exercise powers that it did not possess, that is to say, was either failing to exercise, or was exceeding jurisdiction. A concern to exclude judicial review of error within jurisdiction explains why, in my opinion, certiorari was deliberately omitted from s 75(v). 113 See also Shaw and Gwynne, "Certiorari and Error on the Face of the Record", (1997) 71 Australian Law Journal 356 et seq. 114 Hawes, The Law Relating to the Subject of Jurisdiction of Courts, (1886) at ¶161. 115 Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 116 It is not insignificant that s 33 of the Judiciary Act 1903 (Cth) makes no reference to certiorari. Both it and s 32 which is concerned with the efficacious completeness of relief being enactments only may of course be repealed or amended from time to time. Callinan It is for this reason that although I joined in the grant of certiorari in Re Wakim; Ex parte McNally117, I did, on further reflection, express some reservations about its availability under s 75(v) in Re Refugee Review Tribunal; Ex parte Aala118. In my opinion the legislature may enact provisions to exclude its operation upon the decisions of officers of the Commonwealth simply because it is not included expressly or by implication in s 75(v) of the Constitution. I would draw attention to another matter. Although it is not one which could prevail over a clear constitutional indication to the contrary, it provides good reason not to strain to find any implication in the constitution of a right to certiorari. A compelling modern reality is that, unlike under its predecessors, the Migration Act requires hundreds of decisions to be made, almost certainly on a daily basis, by a multiplicity of officials and itself makes provision for review. To allow all of these decisions to be subject to exhaustive curial review by a single judge, and again on varying bases at various appellate levels, or in this Court in its original jurisdiction, may perhaps be beyond the resources of the country, or in any event of an order of importance below that of other exigencies for which the Parliament and the Executive must provide. Another reality is that parliaments can (within constitutional bounds) and frequently do legislate to decree which disputes are, and which disputes are not to be justiciable just as they determine which resources are to be devoted to them. The courts have no duty to enlarge, to the greatest extent possible, areas of contention between governments and the people. In Craig v South Australia119 this Court (Brennan, Deane, Toohey, Gaudron and McHugh JJ) stated its concern with any extensive use of certiorari to correct non-jurisdictional error of law by inferior courts. Although the Court was speaking of the jurisdiction of one, a superior State court over another, their Honours' observations are relevant to a grant of certiorari to quash a decision of a tribunal or an official of the Commonwealth: "It is far from clear that policy considerations favour such an increase in the availability of certiorari to correct non-jurisdictional error of law. In particular, a situation in which any proceeding in an inferior court which involved a disputed question of law could be transformed into superior court proceedings notwithstanding immunity from ordinary appellate procedures would represent a significant increase in the financial hazards to which those involved in even minor litigation in this country are already exposed. On balance, it appears to us that the question whether there should be such an increase in the availability of certiorari, or of orders in 117 (1999) 198 CLR 511. 118 (2000) 204 CLR 82 at 156-157 [218]. 119 (1995) 184 CLR 163 at 181. Callinan the nature of certiorari, is one that is best left to the responsible legislature." An injunction under s 75(v) of the Constitution This Court has by no means always given Ch III of the Constitution a literal meaning, or meanings to be readily ascertained from the language used in it. This is apparent from a number of cases of which there are four relatively recent examples. The first is Smith Kline & French Laboratories (Aust) Ltd v The Commonwealth120 in which this Court upheld the validity of s 35(2) of the Judiciary Act although that provision had the effect of denying all rights of appeal to the Court, and despite that the proviso to s 73 of the Constitution stated that no exception or regulation prescribed by the Parliament "shall prevent the High Court from hearing and determining any appeal from the Supreme Court of a State in any matter in which at the establishment of the Commonwealth an appeal lies from such Supreme Court to the Queen in Council." to "officer of the meaning given The second example the Commonwealth". Section 75(v) confers original jurisdiction upon this Court in all matters in which mandamus or prohibition or an injunction is sought against an officer of the Commonwealth. It is almost inconceivable that in a chapter of the Constitution which is concerned with the judicature, and which necessarily therefore repeatedly refers to courts and to justices, and makes provision for the creation of other courts by the Parliament, the use of the words "an officer of the Commonwealth" could not have been deliberate and highly specific. The same can be said of the language used by the founders during the Convention debates, as again the speech of Mr Barton to which the Chief Justice has referred, serves as an example. It seems to be with respect, highly unlikely that the term could have been intended to include the judiciary. Notwithstanding this, this Court in R v Watson; Ex parte Armstrong121, held that the prerogative writs lay against a judge of a superior federal court, the Family Court. A similar decision was made, in relation to judges of the Federal Court, in R v Federal Court of Australia; Ex parte Pilkington ACI (Operations) Pty Ltd122 and R v Federal Court of Australia; Ex parte WA National Football League123. 120 (1991) 173 CLR 194. 121 (1976) 136 CLR 248. 122 (1978) 142 CLR 113. 123 (1979) 143 CLR 190. Callinan The third example is the insertion by this Court, effectively, of the word "certiorari" in s 75(v) itself. I do not, with respect, myself think it a sufficient justification for the addition of certiorari to the section, that it may be granted as an aid to, or as ancillary in some way to the other writs for which provision has literally been made124. The fourth example is provided by Kable v Director of Public Prosecutions (NSW)125 in which three Justices of this Court (Gaudron, McHugh and Gummow JJ) found implications in Ch III of the Constitution to the effect that the application by a State Supreme Court of a State Act relating to imprisonment, was independence, objectivity and impartiality of the State court as a court vested with federal jurisdiction. incompatible with the It is arguable then that even though the reference to it in s 75(v) is unqualified, an injunction there might perhaps be available in the original jurisdiction under s 75(v) as an aid to the other remedies expressly nominated by the sub-section only. The juxtaposition of the words suggests this. It seems unlikely that the founders would have intended to confer on this Court a separate, original injunctive jurisdiction against officers of the Commonwealth in and by a section dealing with the prerogative writs but omitting other important remedies such as quo warranto and habeas corpus. The omission of certiorari points to the desire of the founders to restrict the ambit of the remedies in s 75(v) to jurisdictional errors. Quick and Garran thought that injunction was probably included because of the analogy between it and mandamus126. The founders may therefore have intended injunctions to be ancillary remedies in aid of either mandamus, or more particularly, prohibition to ensure that any steps consequent upon a demonstrated error of jurisdiction, and which might not perhaps be effectively restrainable by prohibition, might be enjoined by the Court. I am inclined to think therefore that there is no constitutional inhibition upon the legislature's enactment of provisions to restrict the grant of injunctions other than 124 s 39B of the Judiciary Act 1903 (Cth) can effect no constitutional change and is, like any other section, subject to later express or implied repeal. See also Meagher, Gummow and Lehane (Equity, Doctrines and Remedies, 3rd ed (1992) at [21 102]) who point out that "Under the general law the Court of Chancery had no jurisdiction to issue injunctions against the Crown, since the Chancery Court was itself an emanation of the Crown". It may be that specific reference to an injunction in s 75(v) was made in order to make it clear that the remedy lay in a constitutional context. 125 (1996) 189 CLR 51. 126 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, Callinan those that are ancillary to a grant of prohibition or mandamus. It is however unnecessary to reach a concluded view of that matter in this case. The defendant's submissions The principal submission of the defendant here is that the power (to make a final decision) is not delineated by the grant, that is by the statutory mandate contained in s 474 of the Migration Act only, but by that as enlarged by the new Pt 8 Div 1 of the Migration Act. It might be thought that a statement by Brennan J in Deputy Commissioner of Taxation v Richard Walter Pty Ltd127 is capable of providing a foundation for such a submission: "The privative clause treats an impugned act as if it were valid. In so far as the privative clause withdraws jurisdiction to challenge a purported exercise of power by the repository, the validity of acts done by the repository is expanded." Perhaps the better way to characterize that statement is as a recognition of the practical effect of the process of construing an enactment as a whole and giving a privative clause some room for operation, rather than as a separate principle of statutory construction itself. In any event it could provide no basis for an expansion of any power beyond the constitutional limits within which it must be exercised. The legislative scheme It is necessary, in order to deal fully with the defendant's submissions, to place the relevant provisions in their statutory and legislative context. The particular sections with which the Court is concerned were introduced by the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth) ("the amendment Act of 2001") as part of the new Pt 8 Div 1 of the Migration Act. The revised explanatory memorandum, tabled in the House of Representatives by the Minister contained these statements128: "The amendments to the Migration Act 1958 and the Administrative Decisions (Judicial Review) Act 1977, in relation to judicial review of immigration decision-making: introduce a new judicial review scheme, in particular a privative clause, to cover decisions made under the Migration Act 1958 relating to the ability of non-citizens to enter and remain in Australia; 127 (1995) 183 CLR 168 at 194. 128 Migration Legislation Amendment (Judicial Review) Bill 2001 at 2. Callinan • apply the new judicial review scheme to both the Federal Court and the High Court; and • allow specified decisions to be reviewable under the Administrative Decisions (Judicial Review) Act 1977." The revised explanatory memorandum explained s 474 in this way129: "This new section [475] makes it clear that new Division 2, by implication or otherwise, in no way limits the scope or operation of new section 474." The revised explanatory memorandum said this130 about R v Hickman; Ex parte Fox & Clinton131: "A privative clause is a provision which, although on its face purports to oust all judicial review, in operation, by altering the substantive law, limits review by the courts to certain grounds. Such a clause has been interpreted by the High Court, in a line of authority stemming from the judgment of Dixon J in R v Hickman; ex parte Fox and Clinton, to mean that a court can still review matters but the available grounds are confined to exceeding constitutional limits, narrow jurisdictional error or mala fides." Another possible insight into the Parliament's view of Hickman is provided by the second reading speech with respect to the Migration Legislation Amendment Bill (No 5) 1997, in which the Minister, having regard no doubt not only to Hickman, but also judicial observations of the kind made by Brennan J in Deputy Commissioner of Taxation v Richard Walter Pty Ltd which I have quoted, said132: "The legal advice I received was that a privative clause would have the effect of narrowing the scope of judicial review by the High Court, and of course the Federal Court. That advice was largely based on the High Court's own interpretation of such clauses in cases such as Hickman's 129 Migration Legislation Amendment (Judicial Review) Bill 2001 at 7. 130 Migration Legislation Amendment (Judicial Review) Bill 2001 at 5. 131 (1945) 70 CLR 598. 132 Australia, House of Representatives, Parliamentary Debates (Hansard), 3 September 1997 at 7615. Callinan case, as long ago as 1945, and more recently the Richard Walter case in Members may be aware that the effect of a privative clause such as that used in Hickman's case is to expand the legal validity of the acts done and the decisions made by decision makers. The result is to give decision makers wider lawful operation for their decisions and this means that the grounds on which those decisions can be challenged in the Federal and High Courts are narrower than currently. In practice, the decision is lawful provided the decision maker: was acting in good faith; had been given the authority to make the decision concerned – for example, had the authority delegated to him or her by me, or had been properly appointed as a tribunal member – and did not exceed constitutional limits." The first section of the Migration Act to be noted is s 3A which requires that the Court sever, insofar as possible, valid parts of the Migration Act from any which may be found to be invalid, and give effect to the extent constitutionally possible to a provision which cannot be given unlimited operation: Unless the contrary intention appears, if a provision of this Act: (a) would, apart from this section, have an invalid application; but also has at least one valid application; it is the Parliament's intention that the provision is not to have the invalid application, but is to have every valid application. Despite subsection (1), the provision is not to have a particular valid application if: apart from this section, it is clear, taking into account the provision's context and the purpose or object underlying this Act, that the provision was intended to have that valid application only if every invalid application, or a particular invalid application, of the provision had also been within the Commonwealth's legislative power; or the provision's operation in relation to that valid application would be different in a substantial respect Callinan from what would have been its operation in relation to that valid application if every invalid application of the provision had been within the Commonwealth's legislative power. Subsection (2) does not limit the cases where a contrary intention may be taken to appear for the purposes of subsection (1). This section applies to a provision of this Act, whether enacted before, at or after the commencement of this section. In this section: application means an application in relation to: one or more particular persons, things, matters, places, circumstances or cases; or one or more classes (however defined or determined) of persons, things, matters, places, circumstances or cases. invalid application, in relation to a provision, means an application because of which the provision exceeds the Commonwealth's legislative power. valid application, in relation to a provision, means an application that, if it were the provision's only application, would be within the Commonwealth's legislative power." Section 36 of the Migration Act deals with protection visas and provides that a criterion for one is that the applicant be a non-citizen in Australia "to whom the Minister is satisfied Australia has protection obligations …". Because of the amplitude of the constitutional power of the Parliament with respect to immigration, and also perhaps external affairs had it wished, it could, arguably in my opinion, have stopped there, or have expressly provided that the Minister's decision should be conclusive. And so it would have been, subject only to any requirements to the contrary contained in other legislation such as self-imposed obligations under international treaties and conventions enacted into Australian law, and not impliedly or expressly repealed, or the existence of justiciable constitutional facts and of course s 75(v) of the Constitution. I say this because it is not immediately apparent why, if Parliament can make laws for the deportation of aliens by the Minister it should not similarly Callinan be able to make such laws with respect to the denial of entry and residence of aliens in Australia133. The first provision to note of the new Div 2 of Pt 8 of the Migration Act is s 475 which provides that the Division is not to be taken to limit the scope or operation of s 474. Section 477 prescribes time limits for proceedings in the Federal Court. Section 484 should be noted: The jurisdiction of the Federal Court and the Federal Magistrates Court in relation to privative clause decisions is exclusive of the jurisdiction of all other courts, other than the jurisdiction of the High Court under section 75 of the Constitution. To avoid doubt, despite section 67C of the Judiciary Act 1903, the Supreme Court of the Northern Territory does not have jurisdiction in matters in which a writ of mandamus or the prohibition or an Commonwealth or an officer of the Commonwealth in relation to privative clause decisions. is sought against injunction To avoid doubt, jurisdiction in relation to privative clause decisions the Jurisdiction of Courts (Cross-vesting) Act 1987." is not conferred on any court under Section 486A specifies a time limit on applications to this Court for judicial review of 35 days: An application to the High Court for a writ of mandamus, prohibition or certiorari or an injunction or a declaration in respect of a privative clause decision must be made to the High Court within 35 days of the actual (as opposed to deemed) notification of the decision. The High Court must not make an order allowing, or which has the effect of allowing, an applicant to make an application mentioned in subsection (1) outside that 35 day period. 133 See Pochi v Macphee (1982) 151 CLR 101 at 106 per Gibbs CJ. Callinan The regulations may prescribe the way of notifying a person of a decision for the purposes of this section." If valid and unrestricted in its operation in relation to this plaintiff because he was only notified of the decision on 5 April 2002, more than 35 days before he was able to start these proceedings, s 486A would preclude him from pursuing them. (I take the reference in the section to certiorari to have been made out of caution and of an awareness of the disposition of this Court to grant certiorari in aid, or furtherance of mandamus or prohibition.) That the section refers in terms to an application to this Court is a further recognition by the legislature of its inability to oust the jurisdiction of this Court under s 75(v) of the Constitution, and of an absence of any intention to do so despite the apparently absolute language of s 474. Section 474 provides as follows: A privative clause decision: is final and conclusive; and (b) must not be challenged, appealed against, reviewed, quashed or called in question in any court; and is not subject to prohibition, mandamus, injunction, declaration or certiorari in any court on any account. In this section: privative clause decision means a decision of an administrative character made, proposed to be made, or required to be made, as the case may be, under this Act or under a regulation or other instrument made under this Act (whether in the exercise of a discretion or not), other than a decision referred to in subsection (4) or (5). A reference in this section to a decision includes a reference to the following: granting, making, suspending, cancelling, revoking or refusing to make an order or determination; granting, giving, suspending, cancelling, revoking or refusing to give a certificate, direction, approval, consent or permission (including a visa); Callinan granting, issuing, suspending, cancelling, revoking or refusing to issue an authority or other instrument; imposing, or refusing to remove, a condition or restriction; (e) making or revoking, or refusing to make or revoke, a declaration, demand or requirement; retaining, or refusing to deliver up, an article; doing or refusing to do any other act or thing; conduct preparatory to the making of a decision, including the taking of evidence or the holding of an inquiry or investigation; a decision on review of a decision, irrespective of whether the decision on review is taken under this Act or a regulation or other instrument under this Act, or under another Act; a failure or refusal to make a decision. For the purposes of subsection (2), a decision under a provision, or under a regulation or other instrument made under a provision, set out in the following table is not a privative clause decision: [it is unnecessary to reproduce the table] The regulations may specify that a decision, or a decision included in a class of decisions, under this Act, or under regulations or another instrument under this Act, is not a privative clause decision." The new division relevantly has retrospective operation. The decision of the Tribunal was made before the enactment of the amendment Act of 2001 but, as the plaintiff concedes, the decision was a privative clause decision as defined by s 474(2) of the Migration Act. The plaintiff's concession was correctly made in view of cl 8(2) of Sched 1 to the amendment Act of 2001134. The Migration Act 1958 and the Administrative Decisions (Judicial Review) Act 1977, as amended by this Schedule, apply in respect of judicial review of a decision under the Migration Act 1958 if: (Footnote continues on next page) Callinan The effect of s 474 of the Migration Act For the reasons which I have already given, s 474 would be effective to deny the plaintiff any entitlement to certiorari whether under s 75(v) or otherwise and is valid to that extent at least. Mandamus and prohibition fall for consideration on a different footing. The Parliament cannot deprive this Court of the jurisdiction to grant these. Indeed so much was also conceded. The template for s 474(1) of the Act as appears from its text and the speeches in Parliament, is the privative clause considered by this Court in Hickman, in which Dixon J said135: "The particular regulation is expressed in a manner that has grown familiar. Both under Commonwealth law, and in jurisdictions where there is a unitary constitution, the interpretation of provisions of the general nature of reg 17 is well established. They are not interpreted as meaning to set at large the courts or other judicial bodies to whose decision they relate. Such a clause is interpreted as meaning that no decision which is in fact given by the body concerned shall be invalidated on the ground that it has not conformed to the requirements governing its proceedings or the exercise of its authority or has not confined its acts within the limits laid down by the instrument giving it authority, provided always that its decision is a bona fide attempt to exercise its power, that it relates to the subject matter of the legislation, and that it is reasonably capable of reference to the power given to the body." His Honour's statement derives to some extent at least from what was held in Colonial Bank of Australasia v Willan136. There, Sir James W Colvile, the decision was made on or after the commencement of this Schedule; the decision: (i) was made before the commencement of this Schedule; and (ii) as at that commencement, an application for judicial review of the decision had not been lodged." 135 (1945) 70 CLR 598 at 614-615. 136 (1874) LR 5 PC 417. Callinan speaking for the Privy Council, which had before it a Victorian Act containing a privative clause, said137: "It is, however, scarcely necessary to observe that the effect of this is not absolutely to deprive the Supreme Court of its power to issue a writ of certiorari to bring up the proceedings of the inferior Court, but to control and limit its action on such writ. There are numerous cases in the books which establish that, notwithstanding the privative clause in a statute, the Court of Queen's Bench will grant a certiorari; but some of those authorities establish, and none are inconsistent with, the proposition that in any such case that Court will not quash the order removed, except upon the ground either of a manifest defect of jurisdiction in the tribunal that made it, or of manifest fraud in the party procuring it." And a little later his Lordship described the minimum requirements of a due exercise of jurisdiction138: "In order to determine the first it is necessary to have a clear apprehension of what is meant by the term 'want of jurisdiction'. There must, of course, be certain conditions on which the right of every tribunal of limited jurisdiction to exercise that jurisdiction depends. But those conditions may be founded either on the character and constitution of the tribunal, or upon the nature of the subject-matter of the inquiry, or upon certain proceedings which have been made essential preliminaries to the inquiry, or upon facts or a fact to be adjudicated upon in the course of the inquiry. It is obvious that conditions of the last differ materially from those of the three other classes. Objections founded on the personal incompetency of the Judge, or on the nature of the subject-matter, or on the absence of some essential preliminary, must obviously, in most cases, depend upon matters which, whether apparent on the face of the proceedings or brought before the superior Court by affidavit, are extrinsic to the adjudication impeached. But an objection that the Judge has erroneously found a fact which, though essential to the validity of his order, he was competent to try, assumes that, having general jurisdiction over the subject-matter, he properly entered upon the inquiry, but miscarried in the course of it. The superior Court cannot quash an adjudication upon such an objection without assuming the functions of a Court of appeal, and the power to re-try a question which the Judge was competent to decide." 137 (1874) LR 5 PC 417 at 442. 138 (1874) LR 5 PC 417 at 442-443. Callinan Willan was frequently cited in this Court before Hickman and in Hickman itself, Dixon J referred to some of those citations139. Hickman has been applied on a number of occasions in this Court140. In R v Murray; Ex parte Proctor141 Dixon J elaborated upon what has come to be called "the Hickman doctrine". His Honour said: "But the question must always remain whether in a given case the writ does properly lie. That depends in turn upon the authority which the law gives to the proceedings which it is sought to prohibit. If the law denies to the tribunal in question all authority over the proceedings so that they cannot result in a lawful and effective exercise of power, then the proper remedy is prohibition." Later, his Honour added142: "It then becomes a question whether, upon the true interpretation of the legislative instrument as a whole, it does not sufficiently express an intention that what the Board does shall be considered an authorized exercise of its power and accordingly valid and effectual, notwithstanding that the Board has failed strictly to pursue the procedure the instrument indicates or prescribes and that the Board has in some respects gone 139 R v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598 at 615 citing Baxter v New South Wales Clickers' Association (1909) 10 CLR 114 at 157 per Isaacs J and Australian Coal and Shale Employees Federation v Aberfield Coal Mining Co Ltd (1942) 66 CLR 161 at 182 per Starke J. See also Wall v The King; Ex parte King Won and Wah On [No 1] (1927) 39 CLR 245 at 256 per Isaacs J. 140 Coal Miners' Industrial Union of Workers of Western Australia v Amalgamated Collieries of Western Australia Ltd (1960) 104 CLR 437; R v Commonwealth Conciliation and Arbitration Commission; Ex parte Amalgamated Engineering Union (Australian Section) (1967) 118 CLR 219 especially at 252-254 per Kitto J and see also at 264-265 per Menzies J; R v Coldham; Ex parte Australian Workers' Union (1983) 153 CLR 415; O'Toole v Charles David Pty Ltd (1991) 171 CLR 232. In a taxation setting see Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168 at 179-180 per Mason CJ, 193-195 and 198-199 per Brennan J, 210 per Deane and Gaudron JJ, 222 per Dawson J, 233 per Toohey J and 240 per McHugh J. 141 (1949) 77 CLR 387 at 398. See also Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 389-390 [92] per McHugh, Gummow, Kirby and 142 R v Murray; Ex parte Proctor (1949) 77 CLR 387 at 399. Callinan outside or beyond the limits within which it was intended that the actual exercise of its authority should be confined." His Honour then referred to the distinction between directory and mandatory provisions, forms of nomenclature which were both useful and descriptive, but which have since been criticised in this Court143. He said that the distinction supplies an analogy which may help to explain the effect of the relevant regulations144: "For construed in the traditional manner it must be taken to mean that strict compliance with at least some of the provisions of Part III [of the relevant regulations] is not an indispensable condition to the jurisdiction of the Board and to its authority to make a valid and binding award order or determination." Later, his Honour145 stated the question to be whether the provision (with respect to the making of the relevant determination) is imperatively expressed, or may, on the contrary, yield to the general policy or intention indicated by the provision as to finality. The plaintiff argued in this case that the long line of authority to which I have referred, and in particular, the Hickman doctrine states no more than a mere rule of interpretation and has little or nothing to say about the denial of access to the remedies referred to in s 75(v) of the Constitution. I think that this is an understatement. Dixon J in Hickman and Proctor, as well as stating a rule of construction, embraces two important concepts. The first is that there is a distinction to be made between the exercise of an Executive power and a Judicial power. A court's scrutiny of the former should be undertaken with an understanding that officials and courts operate in different ways: they have different objects to achieve, and that the Constitution by the careful separation in it of the sections relating to Executive power from those concerning the Judicial power which reflect the underlying principle of the separation of powers is expressly indicative of this. The second concept is that because of the nature of Executive power and the way it has to be exercised, perfection will be unachievable, errors will inevitably be made, not all of which it will be the business of courts to correct, even if sufficient judicial resources were available to do so: hence the use in Proctor of "indispensable [requirements]" of the 143 Scurr v Brisbane City Council (1973) 133 CLR 242 at 255-256 per Stephen J. See also Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 389-390 [92] per McHugh, Gummow, Kirby and Hayne JJ. 144 R v Murray; Ex parte Proctor (1949) 77 CLR 387 at 399. 145 R v Murray; Ex parte Proctor (1949) 77 CLR 387 at 400. Callinan exercise of a power and of "manifest error" in Willan146 and other cases. It is very likely that fraud or bribery also would be amenable to correction under s 75(v), being squarely within the Hickman doctrine as conduct falling short of being a bona fide attempt to exercise the relevant power. It may be, for example, that to attract the remedies found in s 75(v) of the Constitution when jurisdictional error is alleged, no less than a grave, or serious breach of the rules of natural justice will suffice, a matter which it is unnecessary to decide at this stage of these proceedings. In my opinion, these matters, the unqualified amplitude of the immigration power in s 51(xxvii) and perhaps also the external affairs power in s 51(xxix), and the careful selectivity by the founders of the remedies which would be available under the Constitution in s 75(v), relevantly require a strict, and perhaps less ambulatory or non-ambulatory reading of s 75(v), and a different approach to its meaning and application from the law which has developed in relation to the prerogative writs generally, and in which s 75(v) is not engaged. Indeed, in my opinion, these matters, the language and structure of the Constitution and the other matters to which I have referred give a particular relevance and vitality to the Hickman doctrine in Constitutional law. The doctrine does not however provide any basis for a departure from the fundamental rule of statutory construction that a provision in an enactment or instrument is to be construed in context having regard to the statute or instrument as a whole. In my opinion therefore, mandamus, prohibition and an injunction may go to cure manifest error of jurisdiction whether, in a relevant sense, by a failure to exercise it, or by a clear excess of it and not otherwise, notwithstanding the apparently absolute language of s 474 of the Migration Act. Another way of expressing the rule is in terms of the Privy Council's advice in Willan, that the remedies will only lie if there has been a departure from an essential or imperative requirement on the part of the relevant officer or tribunal, or a material failure to comply with what might once have conventionally been described as a mandatory provision. Both of these approaches have much in common with the approach of Mason ACJ and Brennan J in R v Coldham; Ex parte Australian Workers' Union147 in which their Honours said that the privative provision "[could not] affect the operation of a provision which impose[d] inviolable limitations or restraints upon the jurisdiction or powers" (emphasis added), thereby recognizing that there might be degrees of limitation upon power, some violable and therefore legally tolerable, and some more serious and therefore inviolable and legally intolerable. 146 (1874) LR 5 PC 417 at 442. 147 (1983) 153 CLR 415 at 419. Dixon J had earlier, in R v Metal Trades Employers' Association; Ex parte Amalgamated Engineering Union, Australian Section (1951) 82 CLR 208 at 248 referred to "inviolable limitations or restraints [by enactments]". Callinan Whether a decision made by an official or an administrative body is not within power or jurisdiction, and whether it is therefore invalid and ineffective, will only usually not be established unless and until a court of appropriate jurisdiction holds that to be so. At that point, to adopt the language of McHugh J in Re Wakim; Ex parte McNally148 the decision can be seen to "have no constitutional effect. For constitutional purposes [it is] a nullity." Whether however relief under s 75(v) will be granted may involve discretionary considerations as well as proof that an error of jurisdiction of a sufficient degree of gravity has been made149. The "decision" may not therefore necessarily turn out to be ineffective. I earlier noted the defendant's argument that s 474 of the Act enlarged the decision-making power of any Commonwealth officer making a decision of the kind to which the section applied, and that in that sense the jurisdiction of the officer or the tribunal was enlarged. To the extent that the submission would have it that those acting under the relevant provisions had a jurisdiction to exceed their jurisdiction, it must be rejected. Merely to state the unqualified proposition is to expose its frailty. It would also be a very unusual and indirect means of expanding a jurisdiction which, if the legislature had wanted those acting under the Migration Act to have, and it could constitutionally confer, it could have sought to confer directly in express terms. The submission if correct, could also produce the constitutionally unacceptable consequence that a tribunal such as the one established under the Migration Act could conclusively determine its own jurisdiction. It follows from what I have said that s 474 of the Act is not wholly invalid. It does not however provide a shield against the discretionary remedies of prohibition, mandamus and injunction available in this Court pursuant to s 75(v) of the Constitution in respect of errors of the kind that I have discussed. Is s 486A of the Act invalid? Whether however the plaintiff can pursue his case in which he alleges jurisdictional error of a kind arguably entitling him to the constitutional remedies also depends upon the validity or otherwise of s 486A of the Act. As I have observed, s 486A does not of itself, on its face, appear to seek to extinguish the right conferred by s 75(v) of the Constitution of any person to 148 (1999) 198 CLR 511 at 565 [79]. 149 cf the suggestion to this effect by Gummow J in Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 657 [146]. Callinan challenge in this Court a "privative clause decision". Nonetheless the questions remain: whether, notwithstanding its appearance, the section does in fact so substantially interfere with or limit access to the constitutional remedies for which s 75(v) provides, that it goes beyond regulation and renders them either nugatory or of virtually no utility; and, whether, in any event, the legislature may regulate (assuming the section to be regulatory only in effect) access to this Court under s 75(v). In argument, the plaintiff asked the Court to infer a negative implication of absence of power of regulation with respect to the remedies under s 75(v) by reason of the express reference in s 73, and the absence of any reference in s 75, to regulation. This is an argument by no means lightly to be dismissed. However, as I have pointed out, s 73 itself was not literally construed in Smith Kline & French Laboratories150 and what on its face appears to be a prohibition was treated there as in the nature of a mere regulation151. The defendant relies on Parisienne Basket Shoes Pty Ltd v Whyte152 in "Prima facie, procedural statutes do not touch jurisdiction. The Factories and Shops Act 1928 merely prescribes that a party shall lay his information within a prescribed period, but that touches his right to proceed and not the jurisdiction or capacity of the tribunal to adjudicate." In the same case Dixon J, with whom Evatt and McTiernan JJ agreed said153: "The limitation of time for laying an information is not a limitation upon the jurisdiction of the court or tribunal before whom the charge comes for hearing. The time bar, like any other statutory limitation, makes the proceedings no longer maintainable, but it is not a restriction upon the power of the court to hear and determine them. It is not true that because an information is in fact laid out of time, the Court of Petty Sessions is powerless to deal with it. Whether or not an information was laid too late is a question committed to their decision; it is not a matter of jurisdiction. In courts possessing the power, by judicial writ, to restrain inferior tribunals from an excess of jurisdiction, there has ever been a tendency to 150 (1991) 173 CLR 194. 151 See, for example, Judiciary Act 1903 (Cth), s 35(2). 152 (1938) 59 CLR 369 at 385. 153 (1938) 59 CLR 369 at 388-389. Callinan draw within the scope of the remedy provided by the writ complaints that the inferior court has proceeded with some gross disregard of the forms of law or the principles of justice. But this tendency has been checked again and again, and the clear distinction must be maintained between want of jurisdiction and the manner of its exercise." Citing Bell v Stewart154, the defendant further submits that the High Court Rules, including those relating to time limits do not "limit" the right of appeal provided by s 73 of the Constitution; they "merely regulate the procedure by which the appeal is brought"; their presence and absence of challenge to them suggests that time limits of various kinds upon any proceedings in this Court are constitutionally acceptable. The thrust of the defendant's primary submission is that unless the regulation has the effect of prohibiting or extinguishing the right it will be valid. The defendant seeks to uphold the section on yet other bases. One of these is that the section is within the constitutional power with respect to one or more of the naturalization and aliens power, the immigration power and the external affairs power. The answer to this last may readily be given, that all of these are subject to the Constitution which confers a power which cannot be extinguished, to grant the remedies to which s 75(v) refers. As an additional argument, the defendant contends that s 486A is a valid law under s 51(xxxix) being a law with respect to a matter incidental to the execution of any power vested by the Constitution in the federal judicature: that the Parliament has already lawfully delegated legislative power to the High Court to make rules and that that power has been used since 1963. Order 55 r 30, which imposes a time limit of two months for an application for a writ of mandamus was given as an example of the exercise of this delegated power. I accept that the Parliament may, consistently, in my opinion, with the approach of the Court to regulation and prohibition in Smith Kline & French Laboratories155 regulate the procedure by which proceedings for relief under s 75(v) may be sought and obtained. But the regulation must be truly that and not in substance a prohibition. I have formed the opinion that s 486A is therefore invalid to the extent that it purports to impose a time limit of 35 days within which to bring proceedings under s 75(v) in this Court. There are certain matters which cannot 154 (1920) 28 CLR 419 at 424 per Knox CJ, Gavan Duffy and Starke JJ. 155 (1991) 173 CLR 194. Callinan be ignored for the purposes of judicial notice. Those matters include that the persons seeking the remedies may be incapable of speaking English, and will often be living or detained in places remote from lawyers pursuant to, for example, ss 178, 189, 192, 250 or 253 of the Migration Act. In those circumstances, to prescribe 35 days within which to bring properly constituted proceedings in this Court under s 75(v) of the Constitution, which can only as a practical matter be filed in one of the capital cities, effectively would be to deny applicants recourse to the remedies for which it provides, particularly when, as here, the section purports to deny power to the Court to extend the time that it might otherwise have under O 60 r 6 of the Rules. Section 486A, although not wholly invalid, can have no operation in relation to the constitutional remedies of mandamus, prohibition and injunction. I do not doubt that there is a power to prescribe time limits binding on the High Court in relation to the remedies available under s 75 of the Constitution as part of the incidental power with respect to the federal judicature. But those time limits must be truly regulatory in nature and not such as to make any constitutional right of recourse virtually illusory as s 486A in my opinion does. A substantially longer period might perhaps lawfully be prescribed, or perhaps even 35 days accompanied by a power to extend time. Finality of litigation is in all circumstances desirable. The Commonwealth has just as much interest in knowing that rights and remedies against it may no longer be pursued as do other litigants. As I earlier observed, the Commonwealth and its Executive have many departments to administer and many priorities to assess and allocations to make. These need to be able to be done upon a reasonably settled basis of the numbers involved and other demands upon the treasury of the nation. It is consonant with the exercise of both Executive and Judicial power that a finite reasonable time be fixed for the supervision by the latter over relevant decisions made by the former. It should also be kept in mind that in any event, delay may provide a discretionary bar to the grant of relief under s 75(v). I would answer the questions in the stated case as follows: Is section 486A of the Migration Act 1958 (Cth) invalid in respect of an application by the Plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? Answer: Upon its proper construction s 486A can have no valid operation with respect to the plaintiff's entitlement (if he can make it out) to mandamus and prohibition under s 75(v) of the Constitution. Callinan Is section 474 of the Migration Act 1958 (Cth) invalid in respect of an application by the Plaintiff to the High Court of Australia for relief under section 75(v) of the Constitution? Answer: Section 474 would be invalid if, on its proper construction, it attempted to oust the jurisdiction conferred on the High Court by s 75(v) of the Constitution. However, on its proper construction, it does not attempt to do so. Section 474 is valid but does not apply to proceedings for mandamus or prohibition that the plaintiff would initiate. By whom should the costs of the proceeding in this Honourable Court be borne? Answer: The costs of the proceedings should be borne as to 25% by the plaintiff and 75% by the defendant.
HIGH COURT OF AUSTRALIA COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA APPELLANT AND TOMARAS & ORS RESPONDENTS Commissioner of Taxation v Tomaras [2018] HCA 62 13 December 2018 ORDER The question of law stated by the trial judge for the opinion of the Full Court of the Family Court of Australia should be answered as follows: Question "Does s 90AE(1)-(2) of the Family Law Act 1975 (Cth) grant the court power to make Order 8 of the final orders sought in the amended initiating application of the [w]ife?", where proposed Order 8 was amended to read: "Pursuant to section 90AE(1)(b) of the Family Law Act 1975 (Cth), in respect of the [wife's] indebtedness to the Commissioner of Taxation for the Commonwealth of Australia [for] taxation related liabilities in the amount of $256,078.32 as at 9 August 2016 plus General Interest Charge (GIC), the [husband] be substituted for the [wife] as the debtor and the [husband] be solely liable to the Commissioner of Taxation for the said debt." Answer Although in relation to a debt owed to the Commonwealth by a party to a marriage s 90AE(1) confers power to make an order that the Commissioner be directed to substitute the husband for the wife in relation to that debt, it is otherwise inappropriate to answer the question without it being found, or agreed, that, within the meaning of s 90AE(3), the making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage, and it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full; and without the court being satisfied that, in all the circumstances, it is just and equitable to make the order. Appeal otherwise dismissed. On appeal from the Family Court of Australia Representation S B Lloyd SC with L T Livingston for the appellant (instructed by Australian Government Solicitor) M L Robertson QC with S J Carius for the first respondent (instructed by No appearance for the second respondent Submitting appearance for the third respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Commissioner of Taxation v Tomaras Family law – Matrimonial cause – Proceedings to alter property interests – Where wife was indebted to Commissioner for certain taxation related liabilities plus general interest charge – Where wife applied for order that husband be substituted for wife as debtor and husband be solely liable to Commissioner for debt – Where s 90AE(1)(b) of Family Law Act 1975 (Cth) permitted court to make order directed to creditor of one party to marriage to substitute other party to marriage in relation to debt owed to creditor – Whether s 90AE bound Commissioner in relation to debt owed to Commonwealth – Whether s 90AE(1)-(2) of Family Law Act granted court power to make order sought by wife. Practice and procedure – Question stated – Where question of law stated by Federal Circuit Court of Australia under s 94A(3) of Family Law Act for opinion of Full Court of Family Court of Australia – Where question concerned jurisdiction to make order – Where preconditions to making of order in s 90AE(3) of Family Law Act unlikely to be satisfied – Whether stated case procedure was appropriate. Words and phrases – "bind the Crown", "case stated", "common probability of fact", "creditor", "Crown immunity", "debt of a party to a marriage", "party to a marriage", "person", "presumption", "property of the parties to a marriage", "property settlement proceedings", "question of law", "rights, liabilities or property interests of a third party", "tax debt", "third party". Family Law Act 1975 (Cth), ss 79, 80, 90AA, 90AC, 90ACA, 90AD, 90AE, 94A, Pts VIII, VIIIAA. KIEFEL CJ AND KEANE J. We agree with Gordon J that under s 90AE of the Family Law Act 1975 (Cth) ("the Act") the court has power to order the Commissioner of Taxation to substitute one party to a marriage for the other in relation to a debt owed to the Commonwealth for income tax. Accordingly, the appeal must be dismissed. Gratefully adopting her Honour's summary of the factual background, the relevant legislation, and the reasons of the Full Court of the Family Court of Australia, we proceed to explain our reasons for that conclusion. Since the decision of this Court in Bropho v Western Australia1 it has been settled that the presumption of statutory construction that general words in a statute do not bind the Crown may be displaced without the use of express words or words of necessary intendment. If the legislative provision in question, when construed in context, discloses an intention to apply to the circumstances of the particular case, then effect must be given to that intention. In this case the intention of the Act is not in doubt. Within Pt VIII of the Act, a court considering the exercise of its jurisdiction in property settlement proceedings under s 79 must, by reason of s 75(2)(ha), take into account the effect of any proposed order on the ability of a creditor of a party to the marriage to recover the creditor's debt. Nothing in Pt VIII of the Act suggests an intention to differentiate between Commonwealth, State and Territory revenue authorities or an intention to differentiate between revenue authorities and other creditors. Further, s 80(1)(f) provides that a court exercising its powers under s 79 may "order that payments be made ... to a public authority for the benefit of a party to the marriage". It is not disputed that this provision contemplates the making of an order that one party to a marriage pay the taxation liability of another to a revenue authority. Thus it is apparent that, in Pt VIII of the Act, the term "creditor" is apt to include the Commonwealth and indeed any other revenue authority. Within Pt VIIIAA of the Act, s 90AA states that the object of that Part is to allow the court to make an order in relation to the property of a marriage under s 79 of the Act that is directed to, or alters the rights, liabilities or property interests of, a third party. Within Pt VIIIAA, s 90AE(1)(b) provides that in proceedings under s 79, the court may make "an order directed to a creditor of one party to a marriage to substitute the other party ... to the marriage for that (1990) 171 CLR 1 esp at 16-17, 22; [1990] HCA 24. See also Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 346-347 [16]-[17]; [1999] HCA 9; Australian Competition and Consumer Commission v Baxter Healthcare Pty Ltd (2007) 232 CLR 1 at 27-28 [41]-[42]; [2007] HCA 38. party in relation to the debt owed to the creditor". Part VIIIAA is thus explicitly ancillary to s 79 of the Act. Given that Pt VIIIAA is ancillary to Pt VIII, a suggestion that a "creditor" in Pt VIIIAA is different from a "creditor" in Pt VIII would be difficult to sustain. Nothing in the language of Pt VIIIAA affords any support to such a suggestion. Further, nothing in the extraneous materials referred to by the parties targets a mischief that might be remedied only by giving "creditor" a narrower scope in Pt VIIIAA than it has in Pt VIII. It must be understood, however, that the power of the court under Pt VIIIAA to make an order directed to a third party is not at large. The power to make an order under s 90AE(1) is conditioned by s 90AE(3). Such an order may be made only if, among other things: the making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage; and if the order concerns a debt of a party to the marriage – it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full; and the court is satisfied that, in all the circumstances, it is just and equitable to make the order". Some statutes may differentiate between ordinary creditors and revenue authorities. In such cases the general consideration of equality before the law, which tends against the application of the presumption that the Crown is not bound by a statute, can be seen to have been displaced in favour of the public interest specifically associated with governmental functions such as the protection of the revenue2. The Act is not such a statute. Any concern for the protection of the revenue – Commonwealth, State or Territory – is met by the terms of s 90AE(3)(b). If this condition is not satisfied, the power to make an order under s 90AE(1)(b) is not enlivened. The observance of this condition by the court is apt to ensure that the interests of the revenue authorities, and other creditors for that matter, are not adversely affected by the making of an order under s 90AE(1)(b). The scope of this power should not be 2 The Commonwealth v Western Australia (1999) 196 CLR 392 at 410 [35], 430 [106]; [1999] HCA 5. distorted by attributing to the Parliament an unfounded apprehension that the courts cannot be trusted to ensure that the statutory conditions upon which the power may be exercised are satisfied. Given that, so far as appears from the record in the present case, the husband is a bankrupt and the wife is solvent, it is not possible to see how the condition in s 90AE(3)(b) could be satisfied in this case. More generally, it is difficult to see how any case where there is a real prospect that the substitution of one spouse for another as the debtor of the revenue authority would create or enhance a risk of non-payment would not fall foul of s 90AE(3)(b) of the Act. It might also be suggested that the prospect that an order for substitution might render the substituted party liable for a revenue debt without the benefit of rights of objection available exclusively to the other party to the marriage as "the taxpayer" under the relevant revenue legislation would mean that the condition in s 90AE(3)(d) is not satisfied. This suggestion raises a question of no little complexity. The circumstance that the income tax liability of the substituted party could not be contested by that party would not necessarily make it unjust or inequitable to order substitution. It may be, for example, that any challenge to the tax liability asserted by the Commissioner would clearly be resolved in favour of the Commissioner. In such a case, an inability to contest the tax liability would not occasion substantial injustice to the substituted party. However, it will rarely be the case that a court trying proceedings between the parties to a marriage will be able responsibly to come to a firm view as to the likely outcome of such a contest. As a practical matter, where a real question arises as to whether a party to a marriage would be substantially prejudiced by an order for substitution, the better course for the court would usually be to conclude that it cannot be satisfied that the condition in s 90AE(3)(b) could be met. In the present case, given that on the material in the record the condition in s 90AE(3)(b) could not be satisfied, it is unnecessary to reach a conclusion in relation to s 90AE(3)(d). For those reasons, we agree with the terms of the answer proposed by Gordon J to the question posed by the stated case. As to the procedure adopted in this case, we would observe that it is regrettable that the primary judge was invited by the parties to state a question of law for the Full Court. While the primary judge cannot fairly be criticised for acceding to the course proposed by the parties, it would have been more efficient, in terms of the administration of justice, if the wife's application for substitution had been allowed to proceed to a determination on the merits. Given the difficulty confronting the wife's application for substitution by reason of the condition in s 90AE(3)(b), the question stated for the opinion of the Full Court was unlikely ever to be of other than academic interest. The question of law stated by the Federal Circuit Court for the consideration of the Full Court of the Family Court under s 94A(3) of the Family Law Act 1975 (Cth) ("the Act"), at the urging of the Commissioner of Taxation, was whether the Federal Circuit Court has power under s 90AE(1) or (2) of the Act to order that a husband be substituted for a wife in relation to a taxation debt owed by the wife to the Commonwealth of Australia. Although the question was cast in terms of power, the argument of the Commissioner, as refined in the course of submissions in the appeal by special leave to this Court from the order embodying the affirmative answer given by the Full Court of the Family Court, was cast primarily in terms of jurisdiction. The Commissioner argued that the Federal Circuit Court lacks power to make such an order under s 90AE(1) or (2) because the jurisdiction conferred on the Federal Circuit Court by s 39(5AA) with respect to matters arising under the Act in respect of matrimonial causes constituted by "proceedings between the parties to a marriage with respect to the property of the parties to the marriage"3 is not extended by s 90AD(1) for the purpose of Pt VIIIAA of the Act to encompass proceedings between the parties to a marriage regarding the taxation debts owed by one or both of those parties to the Commonwealth. The Commissioner argued that the jurisdiction of the Federal Circuit Court is not so extended because a taxation debt owed to the Commonwealth is excluded from the instruction in s 90AD(1) that, for the purpose of Pt VIIIAA, "a debt owed by a party to a marriage is to be treated as property" for the purpose of a matrimonial cause as defined. The Commissioner relied for that exclusion on the common law presumption that a statute does not "bind the Crown". Because the question stated concerns the jurisdiction of the Federal Circuit Court and because the Commissioner's argument that the Federal Circuit Court lacks jurisdiction turns entirely on statutory construction, I see no reason to doubt that the discretion conferred by s 94A(3) of the Act was appropriately exercised by the Federal Circuit Court to state the question for the consideration of the Full Court of the Family Court. That the question is one of general significance for the administration of taxation laws and that it has been raised in other pending cases are additional considerations which support the appropriateness of adopting a procedure to ensure its early and authoritative resolution. That said, I share the view of the Full Court of the Family Court in the decision under appeal that the question is not at all difficult to answer. Rejecting the Commissioner's argument that the reference in s 90AD(1) to "a debt owed by a party to a marriage" excludes a taxation debt owed to the Commonwealth, I would answer the question to the effect that, subject to s 90AE(3), the Federal Circuit Court has power under s 90AE(1)(b) or (2)(b) of the Act to order that the 3 See s 4(1) of the Act (para (ca) of the definition of "matrimonial cause"). husband be substituted for the wife in relation to the taxation debt. The affirmative answer given to the question by the Full Court of the Family Court, although less precise, is substantially to that effect. Stated sufficiently for present purposes, the presumption of the common law of Australia that a statute does not "bind the Crown" is a presumption that a statute enacted by an Australian legislature does not operate to impair the legal position of the body politic or executive government of the Commonwealth, a State or a self-governing Territory4. Underlying the presumption is the understanding that a statute applicable to a citizen has the potential to operate with different force and with different consequences if applied to a government5. The strength of the presumption has varied through time. Applied as here to a statute enacted after 19906, as applied to a statute enacted before 19477, the presumption is displaced simply where an affirmative intention to alter the legal position of the Commonwealth, State or self-governing Territory appears from the text, structure, subject matter or context of the statute. Here, in my opinion, the presumption is displaced by the appearance of an affirmative legislative intention to confer jurisdiction on a court to alter, by an order under s 90AE(1) or (2), the interest of the Commonwealth or a State or a self-governing Territory in a debt owed to it by a party to a marriage. That affirmative intention appears sufficiently from the text and structure of Pt VIIIAA when read in context with s 79 in Pt VIII of the Act. The object of Pt VIIIAA, as expressed in s 90AA, is to allow a court in proceedings under s 79 to make an order "that is directed to, or alters the rights, liabilities or property interests of a third party". The same terminology is repeated in s 90AE(2)(b) in empowering a court to make an order that "alters the rights, liabilities or property interests of a third party in relation to the marriage". 4 NT Power Generation Pty Ltd v Power and Water Authority (2004) 219 CLR 90 at 151-152 [166]-[170]; [2004] HCA 48; McNamara v Consumer Trader and Tenancy Tribunal (2005) 221 CLR 646 at 654-655 [21]-[24]; [2005] HCA 55, referring to Wynyard Investments Pty Ltd v Commissioner for Railways (NSW) (1955) 93 CLR 376 at 393-394; [1955] HCA 72. 5 Roberts v Ahern (1904) 1 CLR 406 at 418; [1904] HCA 17, quoting United States v Hoar (1821) 26 Fed Cas 329 at 330. See also The Commonwealth v Western Australia (1999) 196 CLR 392 at 410 [35]; [1999] HCA 5. 6 Bropho v Western Australia (1990) 171 CLR 1 at 23-24; [1990] HCA 24. Jacobsen v Rogers (1995) 182 CLR 572 at 585-586; [1995] HCA 6, referring to Province of Bombay v Municipal Corporation of Bombay [1947] AC 58. See also Roberts v Ahern (1904) 1 CLR 406 at 418. The term "creditor" in s 90AE(1)(a), (b) and (c) plainly refers to a "third party" whose property interest is in a debt owed by one or both of the parties to the marriage. Section 90AB defines "third party", in relation to a marriage, for the purposes of Pt VIIIAA, to mean "a person who is not a party to the marriage". By operation of s 2C of the Acts Interpretation Act 1901 (Cth), which by force of s 2A of that Act "binds the Crown in each of its capacities", the reference to a "person" within that definition must be taken to "include a body politic or corporate as well as an individual" absent something in the Act to indicate a contrary intention. Unlike the Trade Practices Act 1974 (Cth), in relation to which an intention to exclude a body politic from general references to a "person" was found in specific provisions of that Act which addressed the extent to which that Act was to "bind" the Crown "in right of the Commonwealth" and the Crown "in right of a State"8, the Act contains nothing to evince an intention contrary to the operation of s 2C of the Acts Interpretation Act. When combined with the statement in s 90AC(1)(a) of the Act that Pt VIIIAA "has effect despite anything to the contrary in ... any other law (whether written or unwritten) of the Commonwealth, a State or Territory", s 90AA as interpreted in accordance with s 2C of the Acts Interpretation Act rather indicates a legislative intention that the powers conferred on a court by the Part are to be available in any proceeding under s 79 of the Act to provide for the alteration of the rights, liabilities or property interests of a body politic to which a party to a marriage is indebted, in the same way as the Part provides for the alteration of the rights, liabilities or property interests of a body corporate to which, or an individual to whom, a party to a marriage is indebted. The comprehensiveness and uniformity of the intended operation of Pt VIIIAA in relation to debts owed by one or both of the parties to the marriage to all third parties are confirmed by the narrowness and specificity of the sole exclusion in s 90ACA. The exclusion is of the powers of a court under the Part in relation to "superannuation annuities (within the meaning of the Income Tax Assessment Act 1997)", a subject matter which falls within the separate scheme in Pt VIIIB of the Act. The Commissioner's argument that Pt VIIIAA cannot have been intended to cover taxation debts to the Commonwealth because the Income Tax Assessment Act 1936 (Cth) ("the ITAA") and the Taxation Administration Act 1953 (Cth) ("the TAA") comprise a complete and exhaustive scheme governing the taxation obligations of a party to a marriage is belied by the express 8 See Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 347-349 [20]-[24]; [1999] HCA 9. subordination in s 90AC(1)(a) of all other Commonwealth laws to the operation of the Part. Given that s 90AC(1)(a) creates no exception for the operation of the ITAA or the TAA, neither of those statutes operates to prevent the making of an order under s 90AE(1) or (2) in proceedings under s 79 where the preconditions in s 90AE(3) can be met. The Commissioner points the potential for an order under s 90AE(1) or (2) to operate to impede the availability and operation of the Commissioner's power to amend assessments under s 170 of the ITAA, to impede the availability and operation of a taxpayer's objection, review and appeal rights under Pt IVC of the TAA, to impede the exercise by the Commissioner of recovery powers conferred by Sch 1 to the TAA, and to impact adversely on the accrual of the general interest charge under Pt IIA of the TAA. The mere potential for those impediments and that adverse impact to exist does not mean that the application of s 90AE(1) or (2) of the Act to a taxation debt owed by a party to a marriage to the Commonwealth is so problematic that an intention to confer jurisdiction to permit such an order cannot reasonably be imputed to the Parliament. All of the potentialities the Commissioner points are to which considerations available and appropriate to be taken into account by a court, called upon to make an order under s 90AE(1) or (2), in determining under s 90AE(3)(d) whether "the court is satisfied that, in all the circumstances, it is just and equitable to make the order". The extent to which one or more of those potentialities would, if realised, impact on the determination to be made under s 90AE(3)(d) might be expected to vary from case to case. Factors relevant to the determination to be made under s 90AE(3)(d) in a given case include a range of statutory discretions which the Commissioner might have exercised or might be prepared to exercise, a variety of arrangements which the Commissioner might have entered into or might be prepared to enter into in the exercise of the general powers of administration conferred by s 8 of the ITAA and by s 3A of the TAA, and the power of a court under s 79(5) of the Act to grant an adjournment of proceedings to allow processes under the ITAA and TAA to run their course. Whether s 90AE(3) would permit the exercise of power under s 90AE(1)(b) or (2)(b) in the circumstances of this case is not within the scope of the question that has been stated. It is a topic on which I therefore express no opinion. For these reasons, I would dismiss the appeal. GORDON J. Part VIII of the Family Law Act 1975 (Cth) provides for spousal maintenance and the division of the property of the parties to a marriage. In proceedings with respect to the property of the parties to a marriage9, s 79 in Pt VIII provides that a court may make such order as it considers appropriate altering the interests of the parties to the marriage in the property10, but that the court shall not make such an order unless it is satisfied that in all the circumstances it is just and equitable to make the order11. In considering what order (if any) should be made, the court must take into account prescribed matters12. One matter the court must consider is the effect of any proposed order on the ability of a creditor of a party to the marriage to recover the creditor's debt, so far as that effect is relevant13. Part VIIIAA of the Family Law Act was introduced in 200314 to, relevantly, allow a court to make an order under s 79 that "is directed to, or alters the rights, liabilities or property interests of a third party"15. One of the orders the court may make binding a third party under Pt VIIIAA is an order directed to a creditor of one party to the marriage to substitute the other party to the marriage in relation to the debt owed to that creditor16. This appeal from a judgment of the Full Court of the Family Court of Australia, on a question of law stated by a judge of the Federal Circuit Court of Australia under s 94A(3) of the Family Law Act, is concerned with the interaction between Pts VIII and VIIIAA and, in particular, whether a court in proceedings under s 79 in Pt VIII has power under s 90AE(1) in Pt VIIIAA to make an order directed to the appellant, the Commissioner, to substitute the husband for the wife in relation to a debt owed to the Commonwealth which Included in the definition of "property settlement proceedings" in s 4(1) of the Family Law Act. 10 s 79(1)(a) of the Family Law Act. 11 s 79(2) of the Family Law Act. 12 s 79(4) of the Family Law Act. 13 ss 79(4)(e) and 75(2)(ha) of the Family Law Act. 14 Part VIIIAA had a deferred commencement: see s 2(1) of the Family Law Amendment Act 2003 (Cth). 15 s 90AA of the Family Law Act. 16 s 90AE(1)(b) of the Family Law Act. arises under a taxation law17. The Commissioner contended that he was not bound by s 90AE. The wife contended that the Commissioner was bound, and that the court had power to order the Commissioner to substitute the husband for the wife in relation to a debt owed to the Commonwealth arising under a taxation law. These reasons will show that, under Pt VIIIAA, the court has jurisdiction over debts owed to the Commonwealth; and the court has the power under s 90AE in that Part to order the Commissioner to substitute the husband for the wife in relation to a debt owed to the Commonwealth arising under a taxation law. But these reasons will also show that there will seldom, if ever, be occasion to exercise that power. Case stated The question of law stated by the trial judge for the opinion of the Full Court was as follows: "Does s 90AE(1)-(2) of the [Family Law Act] grant the court power to make Order 8 of the final orders sought in the amended initiating application of the [w]ife?" Order 8 was in the following terms: "Pursuant to section 90AE(1)(b) of the [Family Law Act], in respect of the [wife's] indebtedness to the [Commissioner] [for] taxation related liabilities in the amount of $256,078.32 as at 9 August 2016 plus General Interest Charge (GIC), the [husband] be substituted for the [wife] as the debtor and the [husband] be solely liable to the [Commissioner] for the said debt." The Full Court answered that question: Yes, but with the proviso that s 90AE(1) confers power only to make an order that the Commissioner be directed to substitute the husband for the wife in relation to the debt owed by the wife to the Commissioner. 17 A "taxation law" means an Act of which the Commissioner has the general administration: s 995-1(1) of the Income Tax Assessment Act 1997 (Cth) ("the 1997 Act"). The Commissioner has the general administration of the Income Tax Assessment Act 1936 (Cth) (s 8), the 1997 Act (s 1-7) and the Taxation Administration Act 1953 (Cth) (s 3A). As is apparent, the Full Court rejected the Commissioner's contention that, upon the proper construction of s 90AE in Pt VIIIAA, the court did not have power to make an order under s 90AE directed to the Commissioner. But the question of law stated for the opinion of the Full Court, and therefore the answer provided by the Full Court, said nothing about the fact that, upon the proper construction of Pt VIIIAA, read with Pt VIII of the Family Law Act, a court would rarely, if ever, make such an order directed to the Commissioner in relation to a debt owed to the Commonwealth which arises under a taxation law. In other words, the confined nature of the power conferred was relevant, and was not fully explored. In the circumstances of this matter, the stated case procedure was inappropriate, and the answer given incomplete. Background The wife and husband, the first and second respondents, married in July 1992. They separated in July 2009. During the marriage, the Commissioner issued various assessments requiring the wife to pay, among other things, income tax, the Medicare levy, penalties and the general interest charge ("GIC"). The wife failed to pay the amounts assessed, and did not lodge objections under Pt IVC of ("the TAA"). On 12 November 2009, the Commissioner obtained default judgment against the wife for $127,669.36. GIC continues to accrue on that judgment debt. the Taxation Administration Act 1953 (Cth) The husband was declared bankrupt on 5 November 2013. On 20 December 2013, the wife commenced proceedings in the Federal Circuit Court against the husband seeking, relevantly, orders under s 79 for alteration of their property interests. The wife's application, as originally filed, sought, among other things, the following orders: That the [husband] be responsible for all income tax assessed on income received or deemed to have been received by the [wife] for the income tax year ending 30 June 2009 to the date of payment under Order 2. The [husband] shall do all acts and things and sign all documents as are necessary to release the [wife] from and indemnify the [wife] against any liability present or contingent including tax and bank liabilities, in respect of the [husband] or a related party of the [husband]." In February 2016, the trial judge granted the Commissioner leave to intervene in the proceedings in relation to those orders. As at 9 August 2016, the wife's liabilities to the Commissioner stood at $256,078.32, comprised of the judgment debt of $127,669.36, income tax credits and credit interest on overpayments in the amount of $516.77, and further GIC in the amount of $128,925.73. That month, the trial judge granted the wife leave to amend Order 8 in the terms set out above18 and stated the question of law for the opinion of the Full Court. Full Court As noted earlier, the Full Court (Thackray and Strickland JJ, Aldridge J agreeing generally, but writing separately) answered the question in the affirmative but with the proviso that s 90AE(1) confers power to make only an order that the Commissioner be directed to substitute the husband for the wife in relation to the debt owed by the wife to the Commissioner. Thackray and Strickland JJ held that the additional words sought by the wife – that the husband be solely liable to the Commissioner for the debt – could create the impression that whatever rights the wife had to challenge the debt were extinguished by the order. Given that their Honours were not persuaded such rights would be extinguished, they declined to make the additional order. In formulating that answer, all members of the Court considered the question of Crown immunity from statute at some length. Two members of the Court, Thackray and Strickland JJ, held that the presumption that the Crown is not bound by statute applies only to provisions which impose an obligation or restraint on the Crown19; and that there was no place for the presumption if the provision, properly construed, conferred a benefit on the Crown20. Thackray and Strickland JJ were of the view that it was reasonably arguable that s 90AE could only impose a benefit on the Crown on the basis, among other things, that the Commissioner would have a greater chance of recovering a tax liability given that s 90AE allowed substitution of one party or for both parties to be jointly responsible for the debt, and that, in accordance with s 90AE(3)(b), the order could not be made where it was foreseeable the debt would not be paid. In light of those matters, their Honours saw no place for the presumption. 18 See [34] above. 19 Tomaras v Tomaras (2017) 327 FLR 228 at 232 [16], citing British Broadcasting Corporation v Johns [1965] Ch 32 and Bropho v Western Australia (1990) 171 CLR 1 at 16; [1990] HCA 24. 20 Tomaras (2017) 327 FLR 228 at 232 [16], citing Madras Electric Supply Corporation Ltd v Boarland [1955] AC 667 and McGraw-Hinds (Aust) Pty Ltd v Smith (1979) 144 CLR 633 at 656; [1979] HCA 19. In case they were wrong on the question of benefit, Thackray and Strickland JJ also considered, and rejected, arguments advanced by the Commissioner that the presumption applied and that s 90AE did not rebut that presumption. Two key arguments were advanced by the Commissioner. First, other provisions in the Family Law Act provided means through which one spouse could be made responsible for the taxation liability incurred by the other spouse. Second, the construction advanced by the wife would create absurdities in the application of the taxation law because s 90AE could not operate to transfer the objection, review and appeal rights associated with the tax debt. In relation to the first argument, Thackray and Strickland JJ accepted that other provisions in the Family Law Act provided the means through which one spouse could be directed to meet the taxation liability incurred by the other spouse, but held that such an order provided the original taxpayer with no defence against a claim by the Commissioner; and, further, that the same argument could be made about any other kind of debt. In relation to the second argument – the impact of s 90AE on the application of the taxation law – despite not wishing to express a firm view, Thackray and Strickland JJ were not persuaded that the rights of objection, review and appeal would not pass to the substituted spouse in the event that a s 90AE order were made; and that, if they were wrong in relation to the transferability of objection rights, their Honours were of the view that the Crown would derive a benefit rather than suffer a detriment. Their Honours further noted that the Commissioner had always been treated as a "creditor" for the purposes of ss 79 and 79A. Given the express link between s 79 and s 90AE, it would be "surprising"21, their Honours said, if different meanings were given to the words "creditor" and "debt" appearing in those linked sections. Their Honours further held that the failure of Parliament to include an express carve out, together with the purported benefits that flow to the Commissioner from the making of orders under s 90AE, suggested a legislative intention that the Commissioner be bound by s 90AE. Aldridge J agreed with Thackray and Strickland JJ, subject to certain provisos. First, the principle in relation to Crown immunity now to be applied was that articulated in Bropho v Western Australia22. Aldridge J held that whilst the issue of benefit to, or burden upon, the Crown might be a relevant consideration in determining whether the Crown was bound by a statute, it could not be considered as a starting point or threshold issue. As his Honour observed, 21 Tomaras (2017) 327 FLR 228 at 237 [54]. 22 (1990) 171 CLR 1 at 23-24, quoted in Tomaras (2017) 327 FLR 228 at a historically rigid conception of Crown immunity, whereby an Act of Parliament would not bind the Crown unless by express provision or necessary implication, was discarded in Bropho23; and that was a rejection, at least in part, of the earlier decisions which had endorsed the benefit or burden dichotomy24. Second, contrary to the views of Thackray and Strickland JJ, his Honour concluded that, given that an order under s 90AE operates to interfere with the legal rights and entitlements of the third party, it is not legislation beneficial to the Crown. Aldridge J was also doubtful that one spouse could be substituted for the other in relation to rights of objection and appeal in respect of tax liabilities. However, his Honour was of the view that the issue was not of critical significance because, among other things, it was unlikely that any orders would be made under s 90AE if there were genuine issues of substance that would justify an objection or appeal. Crown immunity The relevant provisions of the Family Law Act do not expressly state that they bind the Crown. The presumption that general words of statutory provisions will not bind the Crown operates as no more than a general principle of statutory construction25; or an aid to statutory construction26. In certain circumstances27, the presumption may represent little more than the starting point of the ascertainment of the relevant legislative intent28. The ultimate question must be whether the presumption has, in all the circumstances, been rebutted and, if it has, the extent to which it was the legislative intent that the relevant statutory provisions should bind the Crown29. The "circumstances include the terms of the statute, its subject matter, the nature of the mischief to be redressed, the general 23 (1990) 171 CLR 1 at 16-17, 22. 24 Tomaras (2017) 327 FLR 228 at 239-240 [66]-[70]. See, eg, Madras Electric [1955] AC 667 at 685; BBC v Johns [1965] Ch 32 at 78-79; McGraw-Hinds (1979) 144 CLR 633 at 656. See also Jacobsen v Rogers (1995) 182 CLR 572 at 585; [1995] HCA 6. 25 Australian Competition and Consumer Commission v Baxter Healthcare Pty Ltd (2007) 232 CLR 1 at 27 [40]; [2007] HCA 38, citing Bropho (1990) 171 CLR 1 at 26 Bropho (1990) 171 CLR 1 at 16. 27 Such as those described in Bropho (1990) 171 CLR 1 at 23. 28 Bropho (1990) 171 CLR 1 at 15-16, 23. 29 Baxter (2007) 232 CLR 1 at 27 [41], quoting Bropho (1990) 171 CLR 1 at 23-24. purpose and effect of the statute, and the nature of the activities of the Executive Government which would be affected if the Crown is bound"30. That list is by no means exhaustive. As identified by Gleeson CJ and Gaudron J in The Commonwealth v Western Australia (Mining Act Case), a rationale for the presumption of Crown immunity is that, in general, acts of the legislature are meant to regulate and direct the acts and rights of citizens and, in most cases, the reasoning applicable to them applies with very different, and often contrary, force to the government itself31. Thus, in applying the presumption in ascertaining legislative intent, the operation of the legislation – its impact or effect on the Crown – is relevant32. The task is to construe the statute in context, adopting a flexible approach to construction which takes into account the nature of the statutory provisions in question and the activities of government to which they might apply33. The impact of a legislative provision on the Crown is not a new consideration. It has also arisen in the context of subjects of the Crown seeking to claim the benefit of the immunity. Kitto J in Wynyard Investments Pty Ltd v Commissioner for Railways (NSW)34 referred to the need to consider the impact on the Crown when identifying classes of cases where a statutory provision not binding on the Crown should be denied an incidence on a subject of the Crown because that incidence would be a legal effect upon the Crown. Relatedly, in Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation35, Mason CJ, Deane, Toohey and Gaudron JJ stated that it was clear from Bropho that the presumption that general words do not bind the Crown must yield to the circumstances involved, including the content and purpose of the provision; the way the provision would operate; and whether the provision would bind servants or agents of the government in relation to acts they do or property which they own or occupy in that capacity. Their Honours went on to 30 Bropho (1990) 171 CLR 1 at 28. See also Baxter (2007) 232 CLR 1 at 28 [42]. 31 (1999) 196 CLR 392 at 410 [35]; [1999] HCA 5, quoting United States v Hoar (1821) 26 Fed Cas 329 at 330. See also Mining Act Case (1999) 196 CLR 392 at 32 See Bropho (1990) 171 CLR 1 at 23. 33 Baxter (2007) 232 CLR 1 at 27 [41], citing Bropho (1990) 171 CLR 1. See generally State Authorities Superannuation Board v Commissioner of State Taxation (WA) (1996) 189 CLR 253 at 270; [1996] HCA 32. 34 (1955) 93 CLR 376 at 393-394; [1955] HCA 72. 35 (1993) 178 CLR 145 at 171-172; [1993] HCA 1. state that there was now no basis for applying the presumption that the Crown was not bound by statute unless the provision in issue would operate to have some effect upon the government36. Whether the relevant provisions of the Family Law Act apply to, and bind, the Crown as creditor cannot be determined without first identifying how those provisions operate37. And, here, the operation of the relevant provisions must be understood in the context of the whole of the Family Law Act, but with particular reference to Pt VIII and then Pt VIIIAA. Statutory framework Part VIII Part VIII of the Family Law Act provides for spousal maintenance and the division of the property of parties to a marriage. Proceedings with respect to the maintenance of a party to a marriage are referred to as "spousal maintenance proceedings"38. Proceedings with respect to the property of the parties to a marriage, or either of them, are defined as "property settlement proceedings"39. The right of a spouse to maintenance is separate from, but inextricably linked to, the division of property. In relation to the parties to a marriage, or either of them, "property" is defined, relevantly, to mean property to which one or both of the parties are entitled "whether in possession or reversion"40. In property settlement proceedings, s 79 in Pt VIII provides that a court may make such order as it considers appropriate altering the interests of the parties to the marriage in the property41. However, the court must not make an order under s 79 unless it is satisfied that in all the circumstances it is just and equitable to make the order42 and, in considering what order (if any) should be made in property settlement proceedings, the court must take into account certain 36 Registrar of the Accident Compensation Tribunal (1993) 178 CLR 145 at 171-172. 37 See Bropho (1990) 171 CLR 1 at 23. 38 ss 4(1) and 74 of the Family Law Act. 39 s 4(1) of the Family Law Act. 40 s 4(1) of the Family Law Act. 41 s 79(1)(a) of the Family Law Act. 42 s 79(2) of the Family Law Act. matters43. Those matters include the financial and non-financial contributions, both direct and indirect, by the parties to the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage44; the effect of any proposed order on the earning capacity of either party to the marriage45; any other order made under the Family Law Act affecting a party to the marriage46; and the matters referred to in s 75(2), so far as they are relevant47. The matters listed in s 75(2) are the matters to be taken into consideration by the court in exercising its jurisdiction in relation to spousal maintenance. The list includes the income, property and financial resources of each of the parties48 and the effect of any proposed order on the ability of a creditor of a party to the marriage to recover the creditor's debt49. That list recognises that when determining what orders the court might make under s 79, the financial resources of the parties to a marriage must be considered; and that also relevant are liabilities owed to the creditors of the parties to the marriage and the effect of any order on the ability of those creditors to recover their debt. The duty of the court, so far as is practicable, is to make orders that will finally determine the financial relationships between the parties to the marriage and avoid further proceedings between them50. In exercising its powers under Pt VIII, the court may make a variety of orders51 including: that a specified transfer or settlement of property be made by way of maintenance for a party to a marriage52; that payments be made direct to a party to a marriage, to a trustee to be appointed or into court or to a public authority for the benefit of a party to the 43 s 79(4) of the Family Law Act. 44 s 79(4)(a)-(b) of the Family Law Act. 45 s 79(4)(d) of the Family Law Act. 46 s 79(4)(f) of the Family Law Act. 47 s 79(4)(e) of the Family Law Act. 48 s 75(2)(b) of the Family Law Act. 49 s 75(2)(ha) of the Family Law Act. 50 s 81 of the Family Law Act. 51 s 80 of the Family Law Act. 52 s 80(1)(ba) of the Family Law Act. marriage53; and any other order which the court thinks it is necessary to make to The Commissioner did not dispute that, for the purposes of s 80(1)(f) of the Family Law Act, the Commonwealth was a "public authority" or that a court may direct a party to a marriage to pay a debt owed to the Commonwealth by the other party. Consistent with the dual objectives of finality and justice in Pt VIII of the Family Law Act, the court has power to adjourn property settlement proceedings if the court is of the opinion that, among other things, there is likely to be a significant change in the financial circumstances of the parties to the marriage and, having regard to the time when that change is likely to take place, it is reasonable to adjourn the proceedings55. Further, where an application is made for an order under s 79 by a party to the marriage then certain persons, whose interests would be affected by the making of the order, are "entitled to become a party" to the proceedings56. Relevantly, a creditor of a party to the proceedings may do so if the creditor may not be able to recover their debt if the order were made57. As Thackray and Strickland JJ noted, the Commissioner has always been treated as a "creditor" for the purposes of ss 79 and 79A. Part VIII recognises, however, that although the orders being made under s 79 are intended to be final, circumstances change. Therefore, s 79A provides that a person affected by an order made under s 79 may apply for that order to be varied or set aside and, if appropriate, another order substituted in its place. But for another order to be substituted, the court must be satisfied that at least one of the circumstances prescribed in s 79A(1) exists. Those circumstances include that58: there has been a miscarriage of justice; it is impracticable, in the circumstances that have arisen since the order was made, for the order, or for a part of the order, to be carried out; or a person has defaulted in carrying out an obligation imposed on that person by the order and, as a result of that default, 53 s 80(1)(f) of the Family Law Act. 54 s 80(1)(k) of the Family Law Act. 55 s 79(5)(a) of the Family Law Act. 56 s 79(10) of the Family Law Act. 57 s 79(10)(a) of the Family Law Act. 58 s 79A(1)(a)-(c) of the Family Law Act. it is just and equitable to vary the order or to set the order aside and make another order in substitution for that order. A creditor of a party to the proceedings in which the order under s 79 was made is deemed to be a person whose interests are affected by the order if the creditor may not be able to recover their debt because the order has been made59. Put in different terms, it is difficult to identify a circumstance where any order would be made under s 79 if it diminished the ability of any creditor to recover a debt owed to them by one or both parties to the marriage. It is against that background that Pt VIIIAA must be construed. Part VIIIAA Part VIIIAA was introduced into the Family Law Act by the Family Law Amendment Act 2003 (Cth). Its stated object is, relevantly, to allow a court, in relation to the property of a party to a marriage, to make an order in property settlement proceedings under s 79 in Pt VIII that "is directed to, or alters the rights, liabilities or property interests of a third party"60. A "third party", in relation to a marriage, means a person who is not a party to the marriage61. The Commissioner accepted that the Commonwealth was a third party for the purposes of Pt VIIIAA. Section 90ADA provides that Pt VIIIAA "does not affect the operation of any other provision" of the Family Law Act. Indeed, the example given in the statute is that certain provisions of s 90AE "do not limit the operation of any other provisions of [the Family Law Act] that require or permit the court to take matters into account in making an order in proceedings under section 79". In other words, Pt VIIIAA is to be construed as sitting alongside, and ancillary to, Pt VIII. That view of Pt VIIIAA is reinforced by further provisions. First, for the purposes of Pt VIIIAA only, s 90AD(1) provides that a debt owed by a party to a marriage is "to be treated as property for the purposes of paragraph (ca) of the definition of matrimonial cause" in s 4(1) of the Family Law Act62. This provision was necessary to give the court in s 79 proceedings the 59 s 79A(4) of the Family Law Act. 60 s 90AA of the Family Law Act. 61 s 90AB of the Family Law Act. 62 The jurisdiction of the court in relation to "matrimonial causes" is addressed in Pt V of the Family Law Act. authority to deal with a debt owed by a party to a marriage63. Having expanded the jurisdiction of the court over those debts, Pt VIIIAA also confers specific powers on the court in relation to that jurisdiction. With the expansion of jurisdiction in Pt VIIIAA, in property settlement proceedings under s 79 in Pt VIII the orders that the court is empowered to make include orders specifically directed to, or against, third parties. Part VIIIAA confers powers to make orders directed to, or altering the rights, liabilities or property interests of, a third party. Second, the orders that a court may make under s 79 and s 90AE which bind a third party are confined by the terms of s 90AE. Sub-sections (1) and (2) of s 90AE identify the third party orders that the court may make as: an order directed to a creditor of the parties to the marriage to substitute one party for both parties in relation to the debt owed to the creditor; an order directed to a creditor of one party to a marriage to substitute the other party, or both parties, to the marriage for that party in relation to the debt owed to the creditor; an order directed to a creditor of the parties to the marriage that the parties be liable for a different proportion of the debt owed to the creditor than the proportion the parties are liable to before the order is made; ... any other order that: directs a third party to do a thing in relation to the property of a party to the marriage; or alters the rights, liabilities or property interests of a third party in relation to the marriage." Having identified the orders that the court is empowered to make under s 90AE(1) or (2), s 90AE(3) provides that a court may only make an order under s 90AE(1) or (2) if: 63 See generally Lacey v Attorney-General (Qld) (2011) 242 CLR 573 at 593 [48]; [2011] HCA 10 and the authorities cited therein. the making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage; and if the order concerns a debt of a party to the marriage – it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full; and the third party has been accorded procedural fairness in relation to the making of the order; and the court is satisfied that, in all the circumstances, it is just and equitable to make the order; and the court is satisfied that the order takes into account the matters mentioned in [s 90AE(4)]." (emphasis added) The matters listed in s 90AE(4) are: the taxation effect (if any) of the order on the parties to the marriage; the taxation effect (if any) of the order on the third party; if the order concerns a debt of a party to the marriage – the capacity of a party to the marriage to repay the debt after the order is made; the economic, legal or other capacity of the third party to comply with the order; if, as a result of the third party being accorded procedural fairness in relation to the making of the order, the third party raises any other matters – those matters; any other matter that the court considers relevant." (emphasis added) Section 90AE was intended to cover, and covers, a range of possible arrangements that a party to the marriage may have which involve a third party, including ownership of life insurance products, shares in corporate entities and the creditors of the parties to a marriage whether they are family, friends or financial institutions64. The range of available orders was "intended to be broad and include[d] substitution of the party liable for a debt, adjusting the proportion of a debt that each party is liable for or ordering the transfer of shares between the parties to the marriage"65. However, the circumstances in which the orders may be made against a third party are confined. Relevantly for the purposes of this appeal, the court may only make an order concerning a debt of a party to a marriage which binds a third party if "it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full"66 (emphasis added). As will become apparent, this provision is important in applying s 90AE to a debt owed to the Commonwealth which arises under a taxation law. Part VIIIAA is facultative and protective. It relevantly provides that Pt VIIIAA has effect despite anything to the contrary in any other law (written or unwritten) of the Commonwealth, a State or Territory, and anything in a trust deed or other instrument67, and that a third party in relation to a marriage is not liable for loss or damage suffered by any person because of things done (or not done) by the third party in good faith in reliance on an order made by a court in accordance with Pt VIIIAA68. Finally, the drafters specifically addressed the effects of the provisions on the executive functions of government. That is evident in two separate ways. First, s 90AE imposes a duty on the court to be satisfied that any order takes into account the taxation effect (if any) of the order on the parties to the marriage and on the third party as well as the social security effect (if any) of the order on the parties to the marriage69. Second, Pt VIIIAA had a deferred commencement. 64 Australia, Senate, Family Law Amendment Bill 2003, Revised Explanatory Memorandum at 24 [147]; Australia, House of Representatives, Parliamentary Debates (Hansard), 12 February 2003 at 11571. 65 Australia, Senate, Family Law Amendment Bill 2003, Revised Explanatory Memorandum at 24 [148]. 66 s 90AE(3)(b) of the Family Law Act. See also Australia, Senate, Family Law Amendment Bill 2003, Revised Explanatory Memorandum at 24 [149]. 67 s 90AC(1) of the Family Law Act. 68 s 90AH of the Family Law Act. 69 s 90AE(3)(e) and (4)(a)-(c) of the Family Law Act. The Senate's Supplementary Explanatory Memorandum explained that the purpose of the deferred commencement was to70: "ensure that any affected third parties, such as banks or financial services bodies, are given sufficient time to make any necessary changes, for example to their operating systems, as a result of the introduction of these provisions. The deferred commencement will also ensure that any necessary consequential amendments, such as amendments to taxation or social security legislation, can be made before the provisions commence." No subsequent consequential amendment to the taxation or social security legislation was identified in argument. Parts VIII and VIIIAA: The application of Crown immunity The presumption that Pt VIIIAA does not apply to the Crown has, in all the circumstances, been rebutted. First, Pts VIII and VIIIAA disclose a legislative intent that the relevant provisions of Pt VIIIAA bind the Crown, when regard is had to: the generality of the language and the express reach of the provisions (including s 90AC); the fact that Pt VIIIAA was introduced specifically to address third parties and restrictions on the ability of a court to direct a third party to act in order to give effect to property settlements71; the fact that a purpose of Pts VIII and VIIIAA is to finalise financial relationships between the parties to a marriage72; and, finally, the fact that the effect of the provisions on third parties is confined in the manner described earlier. of Pt VIIIAA Second, the Commissioner's contention that, although the Commissioner was a "creditor" for the purposes of ss 79 and 79A, he was not a "creditor" for the purposes rejected. The Commonwealth, not the Commissioner, was and remains the creditor. Moreover, the contention finds no support in the language of the two Parts and, in fact, is contrary to the express words of the relevant provisions as well as the mischief that Pt VIIIAA was intended to address. For example, Pt VIIIAA must be construed in light of the Commissioner's acceptance that Pt VIII permits the is misplaced should and 70 Australia, Senate, Family Law Amendment Bill 2003, Supplementary Explanatory Memorandum at 2 [3]. 71 Australia, Senate, Family Law Amendment Bill 2003, Revised Explanatory Memorandum at 22 [134]. See generally Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337; [1981] HCA 1. 72 See s 81 of the Family Law Act. making of orders affecting a "public authority"; and that "public authority" includes the Commonwealth. Further, Pt VIIIAA operates to extend the powers in s 79 in Pt VIII. There is no logical basis for distinguishing between the treatment of the Commonwealth in Pt VIII (as a creditor, and subject to that Part) and the treatment of the Commonwealth in Pt VIIIAA (which extends the court's powers under Pt VIII). Third, the conclusion that Pts VIII and VIIIAA disclose a legislative intent that the relevant provisions of Pt VIIIAA bind the Crown is reinforced when one considers the application of s 90AE to the Commonwealth as creditor as well as the Commissioner, as a holder of a statutory office, with responsibilities in relation to debts owed to the Commonwealth under a taxation law. As was stated earlier, the impact or effect on the Crown of specific legislation, and whether it was intended by Parliament that the legislation have this impact or effect, are relevant. Here, in the application of s 90AE, there is, and there can be, no relevant impact or effect on the Commonwealth, or on the Commissioner, as a holder of a statutory office, with responsibilities in relation to debts owed to the Commonwealth under a taxation law. This is because of s 90AE(3): the Commonwealth is not treated differently from any other third party, and, contrary to the Commissioner's submissions, the Commonwealth can be no worse off. When looked at from an operational perspective, not only is the Commonwealth revenue protected but Pt VIIIAA does not "disrupt" the taxation law. That last statement requires further explanation. As we have seen, s 90AE(3)(b) provides that the court may only make an order concerning a debt of a party to a marriage which binds a creditor under s 90AE(1) if "it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full" (emphasis added). Practically, a s 90AE order would rarely, if ever, be made substituting one party of the marriage for another party in relation to a debt owed to the Commonwealth arising under or as a result of the application of a taxation law. The fact that a court will rarely, if ever, make an order under s 90AE in relation to a tax debt – a debt owed to the Commonwealth – may be illustrated by considering a primary tax debt arising from an assessment issued by the Commissioner under Div 155 of Sch 1 to the TAA. A "tax debt" is a "primary tax debt" (relevantly defined to mean any amount due to the Commonwealth directly under a taxation law73 including any amount that is not yet payable) or a "secondary tax debt" (defined to mean an amount that is not a primary tax debt but is due to the Commonwealth in 73 See fn 17 above. connection with a primary tax debt)74. An amount due under an assessment issued by the Commissioner is an example of a primary tax debt. An amount due to the Commonwealth under an order of a court made in a proceeding for recovery of a primary tax debt is an example of a secondary tax debt. The relevant primary tax debt in this appeal was income tax. Income tax is only due and payable when the Commissioner makes an assessment of income tax75. That assessed amount is a "tax-related liability"76 – a pecuniary liability to the Commonwealth arising directly under a taxation law77. A tax-related liability that is due and payable is a debt due to the Commonwealth and is payable to the Commissioner78 and the Commissioner may sue to recover any amount of that tax-related liability that remains unpaid after it becomes due and payable79. Not only is the notice of assessment conclusive evidence that the assessment was properly made and, except in proceedings under Pt IVC of the TAA, that the amounts and particulars of the assessment are correct80, but the Commissioner may proceed to recover that tax-related liability even though the taxpayer has commenced proceedings under Pt IVC of the TAA81. Moreover, the Commissioner has certain statutory rights to assist in the recovery of tax-related liabilities82. Some of those rights extend beyond the 74 See the definitions of "tax debt", "primary tax debt" and "secondary tax debt" in s 995-1(1) of the 1997 Act read with s 8AAZA of the TAA. 75 s 5-5(2) of the 1997 Act. See also ss 166 and 174(1) of the Income Tax Assessment Act 1936 (Cth). 76 Item 37 of the table in s 250-10(2), and s 255-1, of Sch 1 to the TAA. 77 s 255-1 of Sch 1 to the TAA. 78 s 255-5(1) of Sch 1 to the TAA. 79 s 255-5(2) of Sch 1 to the TAA. 80 Item 2 of the table in s 350-10(1) of Sch 1 to the TAA. Except for the limited jurisdiction conferred by s 39B of the Judiciary Act 1903 (Cth), proceedings under Pt IVC of the TAA are the only avenue to challenge the correctness of an assessment: see generally Federal Commissioner of Taxation v Futuris Corporation Ltd (2008) 237 CLR 146; [2008] HCA 32. 81 ss 14ZZM and 14ZZR of the TAA. 82 See, eg, Subdiv 255-D and Div 260 of Sch 1 to the TAA. person liable to pay an amount of a tax-related liability. And for certain tax- related liabilities83, the amount of the debt continues to accrue on a daily basis because a person is liable to pay the GIC on unpaid amounts84. The GIC is charged not only daily85 but also at a rate well above the 90-day Bank Accepted Bill rate published by the Reserve Bank of Australia86 and is due and payable to the Commissioner at the end of each day87. The objection, review and appeal rights under Pt IVC of the TAA in respect of assessments are limited. Although s 14ZL(1) of the TAA relevantly states that Pt IVC applies if a provision of an Act provides that a "person" who is dissatisfied with an assessment may object against it, the "person" is relevantly the person or persons who may, because of a provision of the taxation law, lodge an objection against the assessment. So, for example, s 175A(1) of the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act") provides that a "taxpayer" who is dissatisfied with an assessment "made in relation to the taxpayer" may object against the assessment in the manner set out in Pt IVC of the TAA. Thus, the effect of s 14ZL of the TAA is to confer objection, review and appeal rights under Pt IVC of the TAA upon the person described in s 175A(1) of the 1936 Act – the "taxpayer" – "in relation to" whom the assessment has been made. It is that taxpayer who is the "person" who has rights and obligations under s 14ZU of the TAA (a "person" making a taxation objection must comply with certain administrative requirements), s 14ZY of the TAA (the Commissioner must make a decision on a taxation objection and serve written notice of the decision "on the person") and s 14ZZ of the TAA (if the "person" is dissatisfied with the objection decision, the "person" may (if the decision is a reviewable objection decision) seek review in the Administrative Appeals Tribunal or appeal to the Federal Court of Australia). The difficulties for any court faced with a request, in relation to a debt owed to the Commonwealth under a taxation law, that it make an order under s 90AE(1) that one party to the marriage be substituted for the other party as the debtor are that these (and other) aspects of the taxation law would appear to prevent a court being satisfied of the two matters identified in s 90AE(3)(b) and (d) – that it is not foreseeable that making the order would result in the debt not 83 See Column 3 of the table in s 8AAB(4) of the TAA. 84 s 8AAC of the TAA. 85 s 8AAC(1) of the TAA. 86 s 8AAD of the TAA. 87 s 8AAE of the TAA. being paid in full; and that, in all the circumstances, it is just and equitable to make the order. The fact that the husband in this appeal was bankrupt is reason enough not to make the order sought by the wife under s 90AE. But there are other facts, matters and circumstances which compel the same conclusion in this appeal: the inability of the husband to exercise the Pt IVC rights of objection and review (both because the time allowed to the wife for objections has long expired, and because of the difficulties identified above); the fact that the debt owed to the Commonwealth, in relation to which the Commissioner has obtained default judgment, is long overdue; and the fact that the size of that Commonwealth debt continues to increase, not just on a daily basis, but at a higher rate, because of the accruing GIC. That list is not and cannot be exhaustive. However, those facts and matters, or even some of them, compel the conclusion that a court could not be satisfied of the matters prescribed in s 90AE(3) and, therefore, the court would not be empowered to make a substitution order under s 90AE(1) in Pt VIIIAA. The matter may be tested this way. Part VIII empowers a court to make an order under s 80(1)(f) directing a party to a marriage to pay a debt owed by the other party, which could include a direction to pay a tax debt owed to the Commonwealth. If the husband had cash or another immediately realisable asset or assets to meet that debt, an order would be made under s 80(1)(f) directing the husband to make a payment direct to a public authority for the benefit of the wife. If that form of order could not be made (because of the lack of means to meet such a debt), then, contrary to the requirements of s 90AE(3), it would be foreseeable that if an order were made under s 90AE(1), it would result in the debt not being paid in full and, in all the circumstances, it would not be just and equitable to make the order. That is, the fact that the husband could not satisfy an order under s 80(1)(f) strongly suggests, even requires, the conclusion that two requirements of s 90AE(3) – that it must not be foreseeable that if the order were made, it would result in the debt not being paid in full, and that it must be just and equitable to make the order – would not be satisfied. Further, as we have seen, Pt VIII expressly empowers a court to adjourn property settlement proceedings if the court is of the opinion that there is likely to be a significant change in the financial circumstances of the parties to the marriage and, having regard to the time when that change is likely to take place, it is reasonable to adjourn the proceedings88. That possibility of an adjournment permits a party to the marriage who owes a debt to the Commonwealth under a taxation law to exercise their rights of objection, review and appeal under Pt IVC of the TAA. 88 s 79(5)(a) of the Family Law Act. Thus, the scope for a s 90AE(1) order in the circumstances of a debt owed to the Commonwealth arising under, or as a result of the application of, the taxation law is limited. A statute may give some kinds of debts owed to the Commonwealth particular attributes (like the taxation law), but to acknowledge that is to put forward a proposition about statute law, not about some abstract notion of either "the Crown" or "debts owed to the Commonwealth"89. The priority of debts owed to the "Crown in right of the Commonwealth" is dealt with by the Crown Debts (Priority) Act 1981 (Cth) and that Act does not draw any relevant distinction between the classes or sources of debts owed to the Crown in right of the Commonwealth. Nor should any such distinction be drawn here. The Commissioner's invitation to single out special attributes of a tax debt as a basis for finding that the Commonwealth is not bound by Pt VIIIAA should be rejected. That framing is artificial and apt to mislead. The real question posed in the appeal was whether Pt VIIIAA binds the Commonwealth: for the reasons given above, the answer is yes. Reconciliation of the treatment of debts owed to the Commonwealth under a taxation law, on the one hand, and property settlement proceedings under Pt VIII of the Family Law Act, on the other, finds resolution not in the concept of Crown immunity but, rather, in the proper construction and application of Pts VIII and VIIIAA of the Family Law Act. In particular, once Pts VIII and VIIIAA are properly construed, what might otherwise appear to be a tension between the treatment of debts arising under, or as a result of, the taxation law and the power of the court under Pt VIIIAA to order substitution of a debtor to the Commonwealth falls away. Case stated procedure Section 94A(1) of the Family Law Act relevantly provides that where a question of law arises which the judge and at least one of the parties wish to have determined by the Full Court of the Family Court before the proceedings are further dealt with, the judge shall state the facts and question in the form of a special case for the opinion of the Full Court and the Full Court must hear and determine the question. 89 cf Bell Group NV (In liq) v Western Australia (2016) 260 CLR 500 at 524 [60]; [2016] HCA 21. This procedure should be used only in exceptional circumstances90. It is more often than not productive of difficulty, delay and artificiality, and should be adopted cautiously91. When deciding whether to state a case, it is the obligation of the court to explore all of the options and weigh the advantages and disadvantages in a particular case, to determine whether the stating of the case would be reasonable92. The problems inherent in the procedure include that a Full Court may be asked to determine a question of law on incomplete facts or assumptions or in circumstances which render it impossible to answer the question in other than a hypothetical fashion93; the question of law is determined on the basis of a statement of facts agreed by the parties or settled by the judge but those facts may differ from those ultimately established by the evidence; and there is In the circumstances of this matter, the stated case procedure was inappropriate. Hearing and determining the property settlement proceedings would have been cheaper and quicker. But, no less importantly, on the proper construction of Pts VIII and VIIIAA, the question of whether the Commonwealth was bound by s 90AE(1) and (2) would not have arisen for determination because of s 90AE(3). That is, even if the Federal Circuit Court had been asked to make the substitution order under s 90AE(1)(b), under s 90AE(3) the Court could only make that order if it was reasonably necessary or reasonably appropriate and adapted to effect a division of property between the parties to the marriage95; it was not foreseeable that to make the order would result in the debt not being paid in full96; and in all the circumstances, it was just and equitable to make the order97. As just explained, given the taxation law, and, further, 90 In the marriage of Daff and Daff (1984) FLC ¶91-516 at 79,189. 91 See generally White v Ridley (1978) 140 CLR 342 at 362-363; [1978] HCA 38. 92 B & B and Minister for Immigration Multicultural & Indigenous Affairs [2002] FamCA 767 at [20]. 93 Re Alcoota Land Claim No 146 (1998) 82 FCR 391 at 394. See also Australian Commonwealth Shipping Board v Federated Seamen's Union of Australasia (1925) 36 CLR 442 at 448, 450-452, 462; [1925] HCA 27. 94 In the marriage of Mullane and Mullane (1980) FLC ¶90-826 at 75,227. 95 s 90AE(3)(a) of the Family Law Act. 96 s 90AE(3)(b) of the Family Law Act. 97 s 90AE(3)(d) of the Family Law Act. the circumstances of the husband and the property of the parties to the marriage in this appeal, it is unlikely that s 90AE(3) could ever be satisfied. Conclusion and orders For those reasons, the appeal should be dismissed but the question of law stated by the trial judge for the opinion of the Full Court should be answered as follows: "Does s 90AE(1)-(2) of the [Family Law Act] grant the court power to make Order 8 of the final orders sought in the amended initiating application of the [w]ife?", where Order 8 was amended to read: "Pursuant to section 90AE(1)(b) of the [Family Law Act], in respect of the [wife's] indebtedness to the [Commissioner] [for] taxation related liabilities in the amount of $256,078.32 as at 9 August 2016 plus [GIC], the [husband] be substituted for the [wife] as the debtor and the [husband] be solely liable to the [Commissioner] for the said debt." Answer: Although in relation to a debt owed to the Commonwealth by a party to a marriage s 90AE(1) confers power to make an order that the Commissioner be directed to substitute the husband for the wife in relation to that debt, it is otherwise inappropriate to answer the question without it being found, or agreed, that, within the meaning of s 90AE(3), the making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage, and it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full; and without the court being satisfied that, in all the circumstances, it is just and equitable to make the order. Edelman EDELMAN J. The question stated for the Full Court of the Family Court of Australia concerns the power of a court under Pt VIIIAA of the Family Law Act 1975 (Cth) to make an order that binds the Commissioner of Taxation. That question was treated in the Full Court and in submissions in this Court as raising the issue of whether to apply a "presumption" that the Crown, in certain respects, is not bound by Pt VIIIAA. To the extent that such a "presumption" is engaged, it has little force and is easily rebutted, as the Full Court concluded. However, a significant part of the Commissioner's submissions ultimately amounted to a claim of inconsistency between provisions in statutes of the same legislature: on the one hand, Pt VIIIAA of the Family Law Act, and, on the other hand, the Taxation Administration Act 1953 (Cth). For the reasons below, in which the facts and background are gratefully adopted from the reasons of Gordon J, there is no such inconsistency. The appeal must be dismissed. the Income Tax Assessment Act 1936 (Cth) and The nature of a presumption A presumption, in the sense used on this appeal, arises because human experience has shown that Parliament has historically acted in a certain way. A presumption in this sense is not a rule of law. It is a standardised inference that arises from "common probabilities of fact"98. The effect of the presumption is that a court is reluctant to give the words of a statute a meaning that "would conflict with recognized principles that Parliament would be prima facie expected to respect"99. This technique is not unique to the understanding of the meaning of words in statutes. It is a technique common to all speech acts, where inferences about meaning are drawn from expectations based upon past experience. In Bropho v Western Australia100, the joint judgment illustrated a "presumption" in this sense with the example of the principle of legality – "the presumption against the modification or abolition of fundamental rights or laudable consequences101, the presumption has principles". Although 98 Wills and Lawes, The Theory and Practice of the Law of Evidence, 2nd ed (1907) at 43. See Thorne v Kennedy (2017) 91 ALJR 1260 at 1271 [34]; 350 ALR 1 at 12; [2017] HCA 49. 99 Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 93; [1925] HCA 53. 100 (1990) 171 CLR 1 at 18; [1990] HCA 24. 101 See Coco v The Queen (1994) 179 CLR 427 at 437-438; [1994] HCA 15; R v Secretary of State for the Home Department; Ex parte Simms [2000] 2 AC 115 Edelman their Honours said that it was based upon the improbability that Parliament would modify or abrogate fundamental rights without expressing its intention with irresistible clearness102. Hence, the presumption would be undermined and could disappear "if what was previously accepted as a fundamental principle or fundamental right ceases to be so regarded"103. In Gifford v Strang Patrick Stevedoring Pty Ltd104, McHugh J explained that modern legislatures "regularly enact laws that infringe the common law rights of individuals". Hence, he said, although the presumption remained strong when the right is a fundamental right of our legal system, it is weak, or even non-existent, in relation to "ordinary" common law rights. A more nuanced approach than one which is all-or-nothing might calibrate the strength of the presumption to the unlikelihood of an intention to impair the particular right based on factors including the importance of the right within the legal system and the extent to which it is embedded in the fabric of the legal system within which Parliament legislates. Where a presumption is against the impairment of a right or power, the force of the presumption can also depend upon the extent to which the right or power is impaired. For instance, the principle that a "subject's right of recourse to the courts is not to be taken away except by clear words"105 is a presumption that was given only weak force in Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd106. In that case, it was recognised that "[a]n intention to alter the settled and familiar role of the superior courts must be clearly expressed"107, but the force of the presumption was reduced because the ouster of judicial review for non-jurisdictional error concerned only "interim" entitlements; adjudication of "final" rights was preserved108. Sometimes, the different concept of a rule of interpretation is also, loosely, described as a "presumption". Holdsworth speculated that some presumptions – 102 See also Potter v Minahan (1908) 7 CLR 277 at 304; [1908] HCA 63; Coco v The Queen (1994) 179 CLR 427 at 437. 103 Bropho v Western Australia (1990) 171 CLR 1 at 18. 104 (2003) 214 CLR 269 at 284 [36]; [2003] HCA 33. 105 Hockey v Yelland (1984) 157 CLR 124 at 130; [1984] HCA 72; Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 92 ALJR 248 at 258 [34]; 351 ALR 225 at 233; [2018] HCA 4. 106 (2018) 92 ALJR 248; 351 ALR 225. 107 (2018) 92 ALJR 248 at 258 [34]; 351 ALR 225 at 233. 108 (2018) 92 ALJR 248 at 259-260 [39], 274 [102]-[103]; 351 ALR 225 at 235, 254. Edelman in the sense of human experience giving rise to "an obvious inference from facts proved or admitted" – might have been "so frequently drawn that they took upon themselves the character of rules of law ... Some of them were made or became only prima facie rules"109. In other words, the repeated enunciation of presumptions in the process of statutory interpretation sometimes led to them becoming prima facie rules of statutory interpretation when Parliament subsequently passed legislation on that "working hypothesis ... known both to Parliament and the courts"110. The "presumption" that the Crown is not bound by legislation In the joint judgment in Bropho, six Justices of this Court considered the presumption that the Crown would not be bound unless either there was an express provision to that effect or it was "manifest from the very terms of the statute"111. Their Honours effectively held that the presumption in those terms could not be justified as an inference of legislative intention arising from common probability. They said that a presumption in such strict terms was based upon historical considerations to modern that are conditions112. Those historical considerations included a narrow conception of the Crown, encompassing little more than the Sovereign113, supporting the inference that the law "is made for subjects and not for the crown"114. As the Crown expanded to include the "mundane tasks of administration in the modern State"115 a presumption in the strict terms that historically applied could no longer be justified. inapplicable largely 109 Holdsworth, A History of English Law, 3rd ed (1944), vol 9 at 140. 110 Electrolux Home Products Pty Ltd v Australian Workers' Union (2004) 221 CLR 309 at 329 [21]; [2004] HCA 40; Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252 at 259 [15]; [2010] HCA 23; Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 at 135 [30]; [2012] HCA 19; Lee v New South Wales Crime Commission (2013) 251 CLR 196 at 264 [171], 310 [312]; [2013] HCA 39. 111 (1990) 171 CLR 1 at 18. 112 (1990) 171 CLR 1 at 19; cf Hobbes, Leviathan (1651) at 250. 113 (1990) 171 CLR 1 at 18. 114 Attorney-General v Donaldson (1842) 10 M & W 117 at 124 [152 ER 406 at 409]. 115 New South Wales, Law Reform Commission, Report of the Law Reform Commission on Proceedings by and against the Crown, Report No 24 (1975) at 67. Edelman However, as five Justices of this Court later observed in Jacobsen v Rogers116, prior to the decision in Bropho the presumption that a statute is not intended to bind the Crown had "been elevated to a rule of construction that the Crown was only bound by a statute by express mention or necessary implication". The necessary implication "was required to be manifest from the very terms of the statute" so that it was "apparent from its terms that its beneficent purpose must be wholly frustrated unless the Crown were bound". In Bropho, this Court rejected the rule that had emerged in those terms. The joint judgment concluded that the presumption did not, "of itself, provide an impregnable foundation for its own observance"117. Nevertheless, since it was a rule that might have been observed in the passage of legislation, the joint judgment recognised that, in interpreting statutes enacted prior to publication of the decision in Bropho, it may be necessary to take account of the background fact that the legislation had been drafted in a context where courts had said that the Crown would not be bound other than where the intention to do so was express or "manifest from the very terms of the statute" or where the purpose of the statute would be "wholly frustrated"118. The joint judgment in Bropho replaced the previous prima facie rule with a differently formulated presumption that can apply in the interpretation of legislation. For legislation enacted after the date of the decision, 20 June 1990, their Honours held that the presumption was only that the "Crown is not bound by the general words of statutory provisions", and that the strength of that presumption will "depend upon the circumstances, including the content and purpose of the particular provision and the identity of the entity in respect of which the question of the applicability of the provision arises"119. So enunciated, the "presumption" that legislation does not bind the Crown was restored as an inference of legislative intention that arises from the common probabilities of fact in the circumstances. The common probability was described by Griffith CJ120, quoting Story J121, as arising because "in most cases 116 (1995) 182 CLR 572 at 585; [1995] HCA 6. 117 (1990) 171 CLR 1 at 21; cf R (Black) v Secretary of State for Justice [2018] AC 118 (1990) 171 CLR 1 at 23. 119 (1990) 171 CLR 1 at 23. 120 Roberts v Ahern (1904) 1 CLR 406 at 418; [1904] HCA 17. See also The Commonwealth v Western Australia (Mining Act Case) (1999) 196 CLR 392 at 410 [35]; [1999] HCA 5. 121 United States v Hoar (1821) 26 Fed Cas 329 at 330. Edelman the meaning applicable to [statutes] applies with very different and often contrary force to the Government itself". However, the circumstances, such as whether the subject matter of the legislation could affect the Crown, will determine whether the presumption applies at all122. And if the presumption applies, the circumstances will also dictate its strength. One important circumstance affecting the strength of the presumption is the nature of the relevant right or duty. Hence, as the joint judgment explained in Bropho123, in circumstances where a statute imposes criminal liability the presumption that it does not bind, and render liable to prosecution, "the Sovereign herself or himself in the right of the Commonwealth or of a State" will be "extraordinarily strong". Similarly, in the circumstance of legislation effecting the divestiture of property124 the presumption might also apply with considerable force. On the other hand, if a statute concerns "general provisions designed to safeguard places or objects" then, in relation to persons such as employees of a government corporation, the presumption will represent "little more than the starting point"125. Similarly, in relation to general criminal law statutes, the force of the presumption in its application to officers of the Crown would be weak or non-existent126. The force of the presumption will also be much weaker if the statute operates to the benefit of the Crown or, to a lesser degree, if it does not necessarily operate to the detriment of the Crown. In other words, if the effect of the statute on the "interests or purposes"127 of the Crown is not, as is "ordinarily" the case when the presumption applies, "to destroy or curtail or impair some interest or purpose" of the Crown128 then it will have weaker force. 122 Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145 at 171-172; [1993] HCA 1. 123 (1990) 171 CLR 1 at 23. 124 The Commonwealth v Western Australia (Mining Act Case) (1999) 196 CLR 392 at 125 Bropho v Western Australia (1990) 171 CLR 1 at 23. 126 Bropho v Western Australia (1990) 171 CLR 1 at 21. 127 Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145 at 171-172. 128 Wynyard Investments Pty Ltd v Commissioner for Railways (NSW) (1955) 93 CLR 376 at 393; [1955] HCA 72. Edelman The background to, and operation of, s 90AE of the Family Law Act Section 79(1)(a) in Pt VIII of the Family Law Act provides that in property settlement proceedings the court may make such order as it considers appropriate, "in the case of proceedings with respect to the property of the parties to the marriage or either of them – altering the interests of the parties to the marriage in the property". Property is defined widely, although with circularity, in s 4(1) to mean property to which one or both of the parties are entitled "whether in possession or reversion". Subject to exceptions that are not presently relevant, s 79(10) includes an entitlement for the following to become a party to the s 79 proceedings: (i) a creditor who may not be able to recover his or her debt if the order were made129; and (ii) any other person whose interests would be affected by the making of the order130. Section 80 provides for powers of the court when acting under Pt VIII, including the powers to make: (i) an "order that any necessary deed or instrument be executed ... or such other things be done as are necessary to enable an order to be carried out"131; (ii) an "order that payments be made direct to a party to the marriage ... or to a public authority for the benefit of a party to the marriage"132; and (iii) "any other order ... which it thinks it is necessary to make to do justice"133. In Ascot Investments Pty Ltd v Harper134, the question was whether the Family Court had the power, under s 80 of the Family Law Act, to make orders requiring a company to register a transfer of the husband's substantial, but not controlling, shareholding in a private company despite the power in the memorandum of association for the directors to refuse to register a transfer. A majority of this Court held that s 80 did not provide a general power for the Family Court to direct that a company register a transfer of shares. That limit on 129 Section 79(10)(a). 130 Section 79(10)(b). 131 Section 80(1)(d). 132 Section 80(1)(f). 133 Section 80(1)(k). 134 (1981) 148 CLR 337; [1981] HCA 1. Edelman power was addressed in 2003135. The Commonwealth Parliament amended the Family Law Act to empower the Family Court to "make orders binding third parties to give effect to property settlement proceedings under the [A]ct"136. One example, given in the Explanatory Memorandum, of the orders that might be made was an order to replace one spouse with the other spouse as being liable to a creditor for a debt137. The 2003 amendments introduced a new Pt VIIIAA into the Family Law Act. One object of the Part, recited in s 90AA, is to "allow the court, in relation to the property of a party to a marriage, to ... make an order under section 79". Section 90AE then provides that in proceedings under s 79, the court can make any of the following orders: an order directed to a creditor of the parties to the marriage to substitute one party for both parties in relation to the debt owed to the creditor; an order directed to a creditor of one party to a marriage to substitute the other party, or both parties, to the marriage for that party in relation to the debt owed to the creditor; an order directed to a creditor of the parties to the marriage that the parties be liable for a different proportion of the debt owed to the creditor than the proportion the parties are liable to before the order is made; ... any other order that: directs a third party to do a thing in relation to the property of a party to the marriage; or 135 See Family Law Amendment Act 2003 (Cth), the relevant provisions of which commenced on 17 December 2004. 136 Australia, House of Representatives, Parliamentary Debates (Hansard), 12 February 2003 at 11571. 137 Australia, Senate, Family Law Amendment Bill 2003, Revised Explanatory Memorandum at 22 [136]. Edelman alters the rights, liabilities or property interests of a third party in relation to the marriage." The Family Law Act and the "presumption" The Commissioner submitted that the Full Court erred by failing to apply the "presumption" that the Crown was not bound by the Family Law Act. The Commissioner's argument had two strands. One strand, addressed in the next section of these reasons, was not really concerned with the presumption. The other, as initially expressed, was that an "onus" rested upon the first respondent to rebut the presumption, and that there was nothing in the Family Law Act from which that onus could be discharged. The Commissioner ultimately, and rightly, did not place much weight on this "onus" strand of his submission. Senior counsel for the Commissioner accepted in oral submissions that the presumption should not be understood as an onus of proof. As I have explained, the presumption does not apply independently of the statutory context. The existence and force of the presumption, as a common probability of fact, depends upon all the circumstances. Sometimes the circumstances are so significant that the presumption is described in different terms. For instance, in State Authorities Superannuation Board v Commissioner of State Taxation (WA)138 the presumption that the Crown is not bound by legislation that imposes a criminal penalty was said by four Justices of this Court to be separate from the general presumption that the Crown is not bound by legislation. It was said to be "a different presumption based upon the inherent unlikelihood that the legislature should seek to render the Crown liable to a criminal penalty"139. In an attempt to increase the force of the presumption, the Commissioner also changed the terms in which it was expressed. The presumption was not expressed in the general terms of being a presumption that the Crown is not bound. Rather, the Commissioner submitted that the presumption was concerned only with the Commissioner. He also submitted that the presumption applied only in relation to tax debts, and only in relation to tax debts owed to the Crown rather than tax debts owed by the Crown. Finally, with the presumption formulated in this narrow way, the Commissioner submitted that it applied only in relation to Pt VIIIAA of the Family Law Act. It is possible that some Crown officers or some Crown property might be bound by legislation but that the general presumption might apply so that other 138 (1996) 189 CLR 253; [1996] HCA 32. 139 (1996) 189 CLR 253 at 270. Edelman officers or property might not be bound140. It is also possible for the general presumption to apply so that part of a statute binds the Crown while another part does not141. And it is also possible that the general presumption might apply even if the relevant provision does not necessarily operate to the detriment of the Crown. But the narrow manner in which the presumption was formulated by the Commissioner militates against such a presumption applying as a general or inherent likelihood of fact. The alleged presumption that Pt VIIIAA does not bind the Commissioner in relation to tax debts owed to the Crown has, at best, weak force. Against that weak force, the plain meaning, in context, of "a creditor of the parties" in Pt VIIIAA of the Family Law Act can include the Commonwealth in respect of a tax debt owed to it. This is particularly so for three reasons. First, it was common ground that Pt VIII of the Family Law Act applies to the Commissioner in relation to tax debts. For instance, an order could be made under s 80(1)(f) requiring that payment of one spouse's taxation liability be made by the other spouse. Hence, it was common ground that the Commonwealth can be a "creditor of a party to the proceedings" within the meaning of s 79(10) in Pt VIII, entitled to become a party to proceedings if it may not be able to recover its tax debt due to an order made under s 79. The presumption that Pt VIIIAA does not bind the Crown in respect of tax debts would therefore require "creditor" in s 90AE(1) to have a meaning different from, and narrower than, its meaning in s 79. And yet, s 90AE is a facilitative provision expressed to apply in proceedings under s 79. Secondly, the property that can be the subject of an order under s 79, within Pt VIII, includes a right to a tax refund including a refundable tax offset142 or a refund of an overpayment143. The consequence of this is that an order can be made under s 90AE(2)(b), "[i]n proceedings under section 79", that alters the liabilities of the Commonwealth as a third party debtor. It would be very curious indeed if, by implication, tax liabilities of the Commonwealth could be altered but tax debts owed to the Commonwealth could not, even though the alteration of the tax debt could not foreseeably cause the Commonwealth not to recover in full144. 140 Bropho v Western Australia (1990) 171 CLR 1 at 23-24. 141 Bropho v Western Australia (1990) 171 CLR 1 at 23. 142 Income Tax Assessment Act 1936 (Cth), s 166. 143 Income Tax Assessment Act 1936 (Cth), s 172. 144 Family Law Act 1975 (Cth), s 90AE(3)(b). Edelman Thirdly, another provision in Pt VIIIAA, namely, s 90AE(2)(a), is also expressed in terms that would, prima facie, include powers to affect the Commissioner in relation to tax debts owed by the Commonwealth. The power of the court in s 90AE(2)(a) is to direct a "third party" to do a thing in relation to the property of a party to the marriage. A "third party" includes "a body politic or corporate"145. No inconsistency between the Family Law Act and the Taxation Statutes A different strand of the Commissioner's submissions was that the Income Tax Assessment Act and the Taxation Administration Act ("the Taxation Statutes") were a "complete and exhaustive code of the rights and obligations of the [C]ommissioner ... to members of the general public ... and of those members of the general public to his department"146. This submission did not concern a common probability of fact that Parliament did not intend to bind the Crown, in particular respects, in Pt VIIIAA of the Family Law Act. Instead, the Commissioner's argument focused upon the relationship between the Taxation Statutes and the Family Law Act as part of a submission that Pt VIIIAA of the Family Law Act should be construed by excluding from its operation any power concerning tax debts owed to the Commonwealth. tax-related liabilities under Sch 1 The Commissioner submitted that, if s 90AE(1) and (2) applied to the Commissioner in relation to tax debts, there would be conflict between the operation of that section and the availability and operation of: (i) the special characteristics of the Taxation Administration Act; (ii) the general interest charge provisions in Pt IIA of the Taxation Administration Act; (iii) the Commissioner's power to amend assessments under s 170 of the Income Tax Assessment Act; and (iv) taxpayers' objection, review and appeal rights under Pt IVC of the Taxation Administration Act. The effect of the Commissioner's submission was that the words "creditor" and "debt" in s 90AE(1) should be interpreted to have a narrower meaning than their meaning in Pt VIII, excluding tax debts owed to the Commonwealth, in order to avoid conflict with the Taxation Statutes. This submission should not be accepted. Four points should be made. 145 Acts Interpretation Act 1901 (Cth), ss 2A, 2C(1). 146 Federal Commissioner of Taxation v Official Receiver (1956) 95 CLR 300 at 310; [1956] HCA 24; Deputy Federal Commissioner of Taxation v Brown (1958) 100 CLR 32 at 49; [1958] HCA 2. Edelman First, the Commissioner's submission that the Taxation Statutes are a code of the rights of the Commissioner and taxpayers, covering the "field"147, does not define the subject matter or field over which that code was intended to be exhaustive. Nor does it explain whether a later Act, also of the Commonwealth Parliament, which introduced Pt VIIIAA of the Family Law Act, was intended to be an exception to any part of the field in which the Taxation Statutes would otherwise be exclusive. The proper approach is to interpret the statutes together "in a way which best achieves a harmonious result"148. Secondly, it can be immediately accepted that a "tax debt" has particular statutory characteristics concerning its existence, quantification, enforceability, and recovery149. But so do other statutory debts owed to the Crown as well as other public and private bodies. The identification of different qualities of a particular debt does not establish conflict between Pt VIIIAA and the legislation that defines the debt. Nor does it establish a conflict over which the terms of the Taxation Statutes should prevail by reading down the provisions of Pt VIIIAA to exclude tax debts owed to, but not by, the Commonwealth. Although a tax refund or overpayment that is payable by the Commonwealth to a spouse has special characteristics, that asset is not excluded from the scope of "property" within s 79. Thirdly, an order under s 90AE(1) or (2) of the Family Law Act can only be made if the requirements of s 90AE(3) are satisfied. Those requirements are fivefold: the making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage; and if the order concerns a debt of a party to the marriage – it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full; and the third party has been accorded procedural fairness in relation to the making of the order; and 147 Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55 at 64-67; [1988] HCA 29. 148 Commissioner of Police (NSW) v Eaton (2013) 252 CLR 1 at 28 [78], see also at 33 [98]; [2013] HCA 2. 149 Bell Group NV (In liq) v Western Australia (2016) 260 CLR 500 at 524 [60]; [2016] HCA 21. See also Deputy Commissioner of Taxation v Broadbeach Properties Pty Ltd (2008) 237 CLR 473 at 493-494 [51]; [2008] HCA 41. Edelman the court is satisfied that, in all the circumstances, it is just and equitable to make the order; and the court is satisfied that the order takes into account the matters mentioned in [s 90AE(4)]." The effect of s 90AE(3)(b) is that the Crown will only be subject to the substitution of a person as its debtor where it is not foreseeable that the substitution would cause the debt not to be paid in full. Further, two of the matters in s 90AE(4) which the court must take into account are (i) the taxation effect (if any) of the order on the parties to the marriage150, and (ii) any other matters raised by the third party, who must be accorded procedural fairness151. Hence, if the order would have the effect of depriving a spouse of the possible exercise of rights of objection to, review of, or appeal from, the assessment, then this could be a taxation effect (s 90AE(4)(a)) or a reason of justice and equity (s 90AE(3)(d)) that would militate against making the order. Further, to the extent that an order under s 90AE(1) would have an effect on the general interest charge provisions in Pt IIA of the Taxation Administration Act, or the Commissioner's power to amend assessments, then these matters would be taken into account by the court when considering, under s 90AE(3)(d), whether it is just and equitable to make the order. Fourthly, to the extent that any conflict would otherwise exist between the Taxation Statutes and Pt VIIIAA of the Family Law Act, s 90AC(1) of the Family Law Act relevantly provides that Pt VIIIAA "has effect despite anything to the contrary" in any written law of the Commonwealth. The only exception to this is in relation to superannuation annuities within the meaning of the Income Tax Assessment Act 1997 (Cth), for which s 90ACA expressly provides that the powers in Pt VIIIAA have no application. When these four points are appreciated, there can be no conflict between the Taxation Statutes and Pt VIIIAA of the Family Law Act, and certainly no conflict that would require the latter to be interpreted as excluding from its reach tax debts owed to the Commonwealth. The answer to the question reserved and the orders on this appeal There was no dispute in the Full Court or in this Court about the reservation or expression of the question for the Full Court. That question was as follows: 150 Section 90AE(4)(a). 151 Section 90AE(4)(g). Edelman "Does s 90AE(1)-(2) of the Family Law Act 1975 (Cth) grant the court power to make Order 8 [substituting the husband for the wife as the debtor to the Commissioner] of the final orders sought in the amended initiating application of the Wife?" The question concerned the jurisdiction – that is, the boundaries of the authority – of a court under the Family Law Act. The "first duty" or "threshold" consideration "of any Court, in approaching a cause before it, is to consider its jurisdiction"152. There was no sufficient reason in this case, where jurisdiction was challenged, for the Federal Circuit Court to ignore that challenge and to proceed instead to consider whether to make the order on the assumption that it had the authority to do so. Whether or not the power should be exercised and the order made, it was appropriate for the disputed jurisdictional question to be reserved by the primary judge for the consideration of the Full Court of the Family Court. The Full Court answered the question reserved as follows: "Yes, but with the proviso that s 90AE(1) confers power only to make an order that the Commissioner be directed to substitute the [husband] for the [wife] in relation to the debt owed by the [wife] to the Commissioner of Taxation for the Commonwealth of Australia." The Full Court's answer properly concerned only the existence of the power, not whether the preconditions to its exercise were satisfied. For the reasons above, the answer given by the Full Court was correct. The appeal should be dismissed. 152 Hazeldell Ltd v The Commonwealth (1924) 34 CLR 442 at 446; [1924] HCA 36. See also Federated Engine-Drivers and Firemen's Association of Australasia v Broken Hill Proprietary Co Ltd (1911) 12 CLR 398 at 415; [1911] HCA 31; Old UGC Inc v Industrial Relations Commission (NSW) (2006) 225 CLR 274 at 290 [51]; [2006] HCA 24; Leeming, Authority to Decide: The Law of Jurisdiction in Australia (2012) at 35-36.
HIGH COURT OF AUSTRALIA AND THE QUEEN APPELLANT RESPONDENT Weiss v The Queen [2005] HCA 81 15 December 2005 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Victoria made on 5 May 2004. Remit the matter to the Court of Appeal of the Supreme Court of Victoria for its further consideration. On appeal from the Supreme Court of Victoria Representation: P F Tehan QC with S T Russell and L C Carter for the appellant (instructed by Falcone and Adams) J D McArdle QC with C B Boyce for the respondent (instructed by Director of Public Prosecutions (Victoria)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Weiss v The Queen Criminal Law – Appeal – Application of "proviso" that no substantial miscarriage of justice has actually occurred – Appellant convicted of murder – Evidence led at trial that should not have been adduced – Appellant appealed against conviction – Appeal court to review the whole case – Utility of reference to what a jury, the actual trial jury or a hypothetical reasonable jury, would have done. Words and phrases – "proviso", "substantial miscarriage of justice", "substantial miscarriage of justice has actually occurred". Crimes Act 1958 (Vic), s 568(1). GLEESON CJ, GUMMOW, KIRBY, HAYNE, CALLINAN AND HEYDON JJ. The important issue in this appeal concerns the operation of the proviso to s 568(1) of the Crimes Act 1958 (Vic) ("the Crimes Act") and how that provision is to be applied in criminal appeals conformably with the language and purpose of the statute which appears in common form throughout Australia. The facts and disposition in the Court of Appeal On 24 November 1994, Ms Helen Elizabeth Grey was murdered. She was beaten to death. In November 2000, the appellant was charged with Ms Grey's murder. At the appellant's trial in the Supreme Court of Victoria, Ms Jean Horstead, with whom the appellant was living in 1994, was an important witness against the appellant. She swore that, on the night of the murder, the appellant had confessed to her that he had killed Ms Grey. Ms Horstead gave evidence that, although she had at first provided the appellant with a false alibi, some years after the murder, and after she had left the relationship with the appellant and moved to America, she had decided to tell the truth. Evidence was led that, some time after Ms Grey was murdered, the appellant formed and thereafter maintained a sexual relationship with a woman other than Ms Horstead. Over the objection of the appellant's counsel, the prosecution was permitted to adduce evidence in cross-examination of the appellant that at the time the appellant began his relationship with the other woman (whom it is convenient to refer to as Renée) she was not yet 15 years old. It is not now disputed that evidence of Renée's age should not have been adduced. To have intercourse with a girl under 16 years of age and to maintain a sexual relationship with her were serious crimes1. None of the criminal consequences of the appellant's conduct with Renée was mentioned to the jury. All that they were told was that she was not yet 15 and a suggestion was made in the course of the prosecutor cross-examining the appellant, but not adopted, that Renée's age had been given as part of the reasons for Ms Horstead terminating her relationship with the appellant. The prosecution did not later suggest that maintaining a sexual relationship with an under-age girl was a matter that went to the appellant's credit. 1 Crimes Act 1958 (Vic), Pt I, Div 1(8C), ss 45-49A. The appellant was convicted. On his appeal to the Court of Appeal of Victoria, the Court (Callaway and Batt JJA, Harper AJA) held unanimously2 that the evidence of Renée's age had been wrongly admitted. Callaway JA (with whose reasons the other members of the Court agreed) rightly held3 that the evidence of Renée's age was not relevant, that it could not be led to bolster the credit of Ms Horstead and that, if it did have any significant probative value, it was outweighed by its prejudicial quality because "[t]he jury became aware, in effect, that the [appellant] had had carnal knowledge of a girl of 14". The Court of Appeal nonetheless dismissed the appellant's appeal, holding that the proviso to s 568(1) of the Crimes Act applied. Having discussed the state of the authorities about the proviso and its application, Callaway JA concluded4 that a distinction should be drawn between an appellate court asking whether, without the wrongly admitted evidence, the jury at the appellant's trial would inevitably have convicted him, and asking whether, without that evidence, any reasonable jury, properly instructed, would inevitably have convicted him. On the former test (the "this jury" test) Callaway JA concluded5 that the appellant's conviction was inevitable; on the latter test (the "any reasonable jury" test) his Honour was of the opinion that it could not be said that the appellant's conviction was inevitable. That was so because6: "Another jury might have taken a different view of Ms Horstead's evidence or the reliability of the [appellant's] confession, for this was a case that largely turned on the credibility of the two principal witnesses." Having regard to some earlier Victorian decisions7, Callaway JA concluded that the relevant test was the "this jury" test and that the appeal should be dismissed. 2 R v Weiss (2004) 8 VR 388. (2004) 8 VR 388 at 397 [60]. (2004) 8 VR 388 at 400-401 [70]. (2004) 8 VR 388 at 400-401 [70]. (2004) 8 VR 388 at 401 [70] footnote 69. 7 R v Konstandopoulos [1998] 4 VR 381; R v McLachlan [1999] 2 VR 553. By special leave, the appellant now appeals to this Court on grounds confined to the application of the proviso. Issues debated in the Court of Appeal, but for which special leave to appeal to this Court was refused, about the effect that trial counsel's behaviour at trial may have had on the fairness of the trial, were said to be indirectly relevant to the application of the proviso. They do not arise directly and, for reasons that will become apparent, the possible effect of trial counsel's conduct need not be considered in deciding this appeal. Some fundamental propositions The questions that are to be decided in the appeal must be considered against some fundamental, if obvious, propositions. First and foremost, the root question is one of statutory construction8. It is the words of the statute that ultimately govern, not the many subsequent judicial expositions of that meaning which have sought to express the operation of the proviso to the common form criminal appeal provision by using other words. Section 568(1) of the Crimes Act provides: "The Court of Appeal on any such appeal against conviction shall allow the appeal if it thinks that the verdict of the jury should be set aside on the ground that it is unreasonable or cannot be supported having regard to the evidence or that the judgment of the court before which the appellant was convicted should be set aside on the ground of a wrong decision of any question of law or that on any ground there was a miscarriage of justice and in any other case shall dismiss the appeal: Provided that the Court of Appeal may, notwithstanding that it is of opinion that the point raised in the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred." cf Gipp v The Queen (1998) 194 CLR 106 at 147-150 [120]-[127] per Kirby J; Farrell v The Queen (1998) 194 CLR 286 at 295 [18] per Kirby J; Fleming v The Queen (1998) 197 CLR 250 at 255-256 [11]-[12] per Gleeson CJ, McHugh, Gummow, Kirby and Callinan JJ. The task of construing this section is not accomplished by simply taking the text of the statute in one hand and a dictionary in the other9. Especially is that so when note is taken of some particular features of this provision. What is to be made of the contrast between the provisions in the body of the section that the court "shall allow the appeal" if certain conditions are met and the proviso that the Court "may … dismiss the appeal" if another condition is met? What is to be made of expressions like "if it [the Court] thinks that the verdict of the jury should be set aside …"? What is to be made of the reference in the body of the section to "a miscarriage of justice" compared with the reference in the proviso to "no substantial miscarriage of justice"? How is the proviso to operate when it is cast in terms that the Court "may … notwithstanding that [the Court] is of opinion that the point … might be decided in favour of the appellant … dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred"? What is the intensity to be given to the words "may", "might", "considers"? What, if anything, turns on referring, in the first kind of ground of appeal specified in the body of the section, to the verdict of the jury but referring, in the second kind of ground, to the judgment of the Court? Not all of these particular questions must be considered in this appeal. But none of them, and none of the more general questions of construction presented by the statute, can be answered without understanding the context in which what is now the common form of Australian criminal appeal statute was drafted and enacted. The history of the adoption of the proviso Examination of the history of the common form of criminal appeal statute often begins by noticing its origin in the Criminal Appeal Act 1907 (UK) ("the 1907 English Act"). It is, of course, correct to note that the language of s 568(1) of the Crimes Act, and its equivalents in other States, was taken directly from s 4(1) of the 1907 English Act. It is necessary, however, to look beyond that fact in order to understand why s 4(1) of the 1907 English Act took the form it did. In particular, it is essential to put both s 4(1) of the 1907 English Act, and its Australian equivalents, in their proper contexts, both historically and otherwise. 9 Cunard SS Co v Mellon 284 F 890 (1922) at 894 per Judge Learned Hand. The 1907 English Act replaced the old procedure for Crown Cases Reserved10. It was enacted more than 30 years after the Judicature Act reforms, but against a background where the understanding of when a new trial would be ordered was that the "Exchequer rule" prevailed. Before 1835 an erroneous admission or rejection of evidence was not a sufficient ground to set aside a jury's verdict and order a new trial unless upon all the evidence it appeared to the judges that the truth had not been reached11. In 1835, however, Crease v Barrett12, a decision of the Court of Exchequer, was taken as establishing a new rule: the Exchequer rule. The language actually used by Parke B in Crease v Barrett13 may not suggest the adoption of a new rule but in other cases decided in and after 1835 the rule was taken to be14 that the courts generally had renounced any discretion and, "where evidence formally objected to at Nisi Prius is received by the Judge, and is afterwards thought by the Court to be inadmissible, the losing party has a right to a new trial" (emphasis added). On the civil side, this rule was done away with in the rules of court enacted by the Supreme Court of Judicature Act 1873 (UK). Rule 48 of those rules provided: "A new trial shall not be granted on the ground of misdirection or of the improper admission or rejection of evidence, unless in the opinion of the Court to which the application is made some substantial wrong or miscarriage has been thereby occasioned in the trial of the action; and if it 10 See Conway v The Queen (2002) 209 CLR 203 at 210-211 [10]-[12]. 11 Margaret Tinkler's Case (1781) R & R 133 note [168 ER 721]; R v Ball (1807) R & R 132 [168 ER 721]; R v Teal (1809) 11 East 307 at 311 [103 ER 1022 at 1024]; R v Treble (1810) R & R 164 [168 ER 740]; cf, on the civil side, Tyrwhitt v Wynne (1819) 2 B & Ald 554 at 559 [106 ER 468 at 470]; Wigmore, A Treatise on the Anglo-American System of Evidence in Trials at Common Law, 3rd ed (1940), vol 1 at 365-367. 12 (1835) 1 Cr M & R 919 [149 ER 1353]. 13 (1835) 1 Cr M & R 919 at 933 [149 ER 1353 at 1359]. 14 Wright v Doe dem Tatham (1837) 7 A & E 313 at 330 per Lord Denman CJ [112 ER 488 at 495]; cf de Rutzen v Farr (1835) 4 A & E 53 at 56-57 [111 ER 707 appear to such Court that such wrong or miscarriage affects part only of the matter in controversy, the Court may give final judgment as to part thereof, and direct a new trial as to the other part only." And the subsequent 1883 rules made like provision in O 39 r 6. In Bray v Ford15, Lord Herschell contrasted the requirement of "substantial wrong or miscarriage" with the entitlement before the Judicature Act to a new trial as of right where there had been any misdirection which could not be said to be upon a wholly immaterial point. There is an evident similarity between the language used in those rules ("unless in the opinion of the Court … some substantial wrong or miscarriage has been thereby occasioned in the trial of the action") and the language later to be adopted in the proviso to s 4(1) of the 1907 English Act ("if they [the Court] consider that no substantial miscarriage of justice has actually occurred"). But the language is not identical. The Judicature Act rule and the 1883 rules provided a qualification to an otherwise generally expressed prohibition against orders for new trial: "a new trial shall not be granted … unless"; the proviso to s 4(1) of the 1907 English Act was a qualification to an otherwise generally expressed command to allow an appeal and, in consequence, quash the conviction and direct entry of a verdict and judgment of acquittal. Be this as it may, after the Judicature Act reforms, the Exchequer rule was understood as still governing the jurisdiction of the Queen's Bench Division, in Crown Cases Reserved, to order a new trial in a criminal matter. In R v Gibson16, Lord Coleridge CJ, speaking in 1887, stated the rule as being that "if any bit of evidence not legally admissible, which might have affected the verdict, had gone to the jury, the party against whom it was given was entitled to a new trial". The better view may be that what was said in Gibson was "much misunderstood"17 and that it established no absolute rule. As Griffith CJ pointed out in R v Grills18: 15 [1896] AC 44 at 52. 16 (1887) 18 QBD 537 at 540-541. 17 R v Grills (1910) 11 CLR 400 at 409 per Griffith CJ; Balenzuela v De Gail (1959) 101 CLR 226 at 234-235; Conway (2002) 209 CLR 203 at 212-217 [15]-[29]. 18 (1910) 11 CLR 400 at 410. "It happens … in innumerable cases that, by inadvertence, irrelevant evidence (which, strictly speaking, is not admissible) is admitted, and passes without notice and without mischief. But there is no case which decides that a conviction is necessarily bad on the ground that the jury had not been expressly directed to disregard such evidence." It is, nonetheless, important to recognise that the Exchequer rule was often expressed in absolute terms. And as later will be observed, judicial reasons considering the meaning and application of the proviso to the common form criminal appeal statute have often exhibited the same tendency to state rules in absolute terms. The matters of history that are recorded above readily show that the proviso to s 4(1) of the 1907 English Act was intended to do away with the Exchequer rule. But they also cast light upon what appears to be a conundrum19 presented by reference in the grounds on which the Court of Appeal shall allow the appeal to a "miscarriage of justice", and reference in the proviso to dismissing the appeal if the Court "considers that no substantial miscarriage of justice has actually occurred". What the history reveals is that a "miscarriage of justice", under the old Exchequer rule, was any departure from trial according to law, regardless of the nature or importance of that departure. By using the words "substantial" and "actually occurred" in the proviso, the legislature evidently intended to require consideration of matters beyond the bare question of whether there had been any departure from applicable rules of evidence or procedure. On that understanding of the section as a whole, the word "substantial", in the phrase "substantial miscarriage of justice", was more than mere ornamentation. If the 1965 Report of the Interdepartmental Committee on the Court of Criminal Appeal ("the Donovan Committee")20 was right to conclude, as it did21, that the construction which had been placed on the proviso by the English courts rendered the word "'substantial' … devoid of practical significance", the construction and application of the proviso had moved a very long way from its historical roots. 19 R v Gallagher [1998] 2 VR 671. 20 Cmnd 2755. 21 at 37, par 164. Noting that the proviso was evidently intended to require consideration of matters beyond the question of whether there had been a departure from applicable rules of evidence or procedure presents the further question of what matters are to be addressed in deciding whether a substantial miscarriage of justice has actually occurred. And that was seen as the determinative question in this case in the Court of Appeal. Before turning to consider that question, however, it is necessary to notice some other contextual and historical matters. The 1907 English Act made no provision for the Court of Appeal to order a new trial. Section 4(2) of the 1907 English Act provided: "Subject to the special provisions of this Act, the Court of Criminal Appeal shall, if they allow an appeal against conviction, quash the conviction and direct a judgment and verdict of acquittal to be entered." (emphasis added) This is to be contrasted with s 4(2) of the Crimes Act 1914 (Vic) ("the 1914 Victorian Act"). That provision required the Full Court of the Supreme Court of Victoria "if they allow an appeal against conviction [to] quash the conviction and either direct a judgment and verdict of acquittal to be entered or direct a new trial to be had" (emphasis added). All of the Australian States (and eventually the mainland Territories22) copied the template appearing in the 1907 English Act. As in Victoria, the legislation in the other Australian jurisdictions went further than the 1907 English Act empowering courts of criminal appeal either to direct a judgment and verdict of acquittal to be entered or to direct a new trial to be had. The Australian legislation, by adopting common form legislation based substantially on the English precedent, replaced the disparate and, to some extent, uncertain position that had existed in the Australian colonies concerning the powers of the local Supreme Courts to order new trials after convictions were quashed following the determination of points reserved in the trial for consideration by the Supreme Court23. Whereas such a power had been doubted in New South 22 The proviso does not appear, in terms, in the Federal Court of Australia Act 1976 (Cth). See Conway v The Queen (2002) 209 CLR 203 at 218-219 [35]-[36] per Gaudron ACJ, McHugh, Hayne and Callinan JJ, 230-231 [76]-[77] per Kirby J. 23 O'Connor, "Criminal Appeals in Australia Before 1912", (1983) 7 Criminal Law Journal 262 at 267. Wales24, it had been exercised in Victoria pursuant to a local statute that had become law in 185225. This empowered the colonial Supreme Court of Victoria on a point of law reserved in the trial "to hear and determine the question of law so reserved, and to affirm, amend, or reverse the judgment which shall have passed on such person, or to direct a venire de novo or new trial to be had, or to make such other order as the justice of the case may require …". Even before the 1907 English Act was copied in Australia, the Victorian court was ordering new trials pursuant to this statutory provision. An apparent object of copying most of the provisions of the 1907 English Act throughout Australia was to secure the advantages thereby procured whilst, at the same time, settling disputes that had vexed the administration of criminal justice in several of the Australian colonies before Federation. Like the 1907 English Act, the 1914 Victorian Act made elaborate and detailed provision26 for supplemental powers of the Full Court in criminal appeals. The Full Court was given power27, in addition to the powers it would have in an appeal or application in a civil case, to order production of documents, exhibits or other things connected with the proceedings, "the production of which appears to them necessary for the determination of the case", power28 to order "any witnesses who would have been compellable witnesses at the trial to attend and be examined before the Court whether they were or were not called at the trial" (emphasis added), power29 to receive evidence of any witness, power30 24 Attorney-General of New South Wales v Bertrand (1867) 4 Moo PC NS 460 [16 ER 391]; R v Murphy (1868) 5 Moo PC NS 47 [16 ER 432]. 25 An Act for Improving the Administration of Criminal Justice, 16 Vict No 7 s 28, noted (1983) 7 Criminal Law Journal 262 at 273-274 citing also R v Whelan (1868) 5 WW & A'B (L) 7 at 21. 27 s 9(a). 28 s 9(b). 29 s 9(c). 30 s 9(d). "where any question arising on the appeal involve[d] prolonged examination of documents or accounts or any scientific or local investigation" which could not conveniently be conducted before the Full Court to refer the question for inquiry and report to a special commissioner, and power31 to "appoint any person with special expert knowledge to act as assessor … in any case where it appear[ed] to the Court that such special knowledge is required for the proper determination of the case". These procedural provisions were necessary only if the Full Court (and the Court of Appeal in England) was to make its own inquiry about whether the accused was in fact guilty as the jury had found and had moved beyond functions apt solely to a court of error. Neither the 1907 English Act nor each States' enactment of appellate provisions drawn from the 1907 English Act32 was the first time that legislation was enacted that was intended to abolish the application of the Exchequer rule in criminal appeals. In India, provision was made first by Sir James Fitzjames Stephen's Indian Evidence Act 1872 (s 167) and then by the Code of Criminal Procedure of 1898 (ss 423, 537). The Privy Council later remarked that these provisions showed "the wide disparity between the law of India and the law of England in their respective attitudes to the verdict of a jury in criminal cases"33. In New South Wales, s 423 of the Criminal Law (Amendment) Act 1883 (NSW) (46 Vict No 17) ("the 1883 NSW Act") had empowered the court considering a question reserved under the Crown Cases Reserved procedure (among other things) to affirm, amend or reverse the judgment given at trial. But that power was qualified by the proviso that: 31 s 9(e). 32 Criminal Appeal Act 1912 (NSW), s 6(1); Criminal Appeals Act 1924 (SA), s 6(1) (see now Criminal Law Consolidation Act 1935 (SA), s 353(1)); Criminal Code Amendment Act 1913 (Q) (see now Criminal Code (Q), s 668E(1) and (1A)); Criminal Code (WA), s 689(1) (see now Criminal Appeals Act 2004 (WA), s 14(2)); Criminal Code Act 1924 (Tas), s 402(1) and (2); Criminal Code Act (NT), s 411(1) and (2). 33 Abdul Rahim v King-Emperor (1946) LR 73 IA 77 at 90. "[N]o conviction or judgment thereon shall be reversed arrested or avoided on any case so stated unless for some substantial wrong or other miscarriage of justice." How were provisions like these, culminating as they did in the proviso to s 4(1) of the 1907 English Act, to be construed? What was the task they set for the court hearing the appeal? The answer to these questions is best approached by considering what underpinned the Exchequer rule. The Exchequer rule and the accused's rights Writing in 1940, Wigmore identified34 two theories that could support the Exchequer rule. The first was that a party has a legal right to observance of the rules of evidence (and, we would add, to observance of all other aspects of law and procedure, the contravention of which could constitute "a wrong decision of any question of law" or "on any ground … a miscarriage of justice"). The second was that judicial consideration of the weight of all the evidence, as a motive for refusing a new trial, would be the usurpation of the jury's function. These two "rights" (to a trial according to law and to the verdict of a jury) can be seen to have informed the subsequent interpretations of statutes intended to do away with the Exchequer rule. Thus, in Mraz v The Queen, Fullagar J said35 that the proviso should be read, and in fact always had been read, "in the light of the long tradition of the English criminal law that every accused person is entitled to a trial in which the relevant law is correctly explained to the jury and the rules of procedure and evidence are strictly followed" (emphasis added). But to speak of either a right to a trial according to law or a right to have guilt determined by verdict of a jury is useful only if there can be no circumstances in which an appellate court may conclude that an error made at trial does not warrant setting aside the verdict of the jury or the judgment entered in consequence of that verdict. If an appellate court finding error at trial may decline to set aside the verdict and judgment, the relevant inquiry, about when that is to be done, cannot be answered by asserting the existence of an unqualified right to it not being done. 34 A Treatise on the Anglo-American System of Evidence in Trials at Common Law, 3rd ed (1940), vol 1 at 368. 35 (1955) 93 CLR 493 at 514. Notions of usurpation of the jury's function may perhaps be seen in the Privy Council's consideration of the proviso to the 1883 NSW Act in the famous baby-farming case of Makin v Attorney-General for New South Wales36, now chiefly remembered as the origin of much of the doctrine about admission and rejection of similar fact evidence. In Makin, the Judicial Committee concluded37 that "substantial wrong would be done to the accused if he were deprived of the verdict of a jury on the facts proved by legal evidence, and there were substituted for it the verdict of the Court founded merely upon a perusal of the evidence". This was said to follow38 from the fact that: "The evidence improperly admitted might have chiefly influenced the jury to return a verdict of guilty, and the rest of the evidence which might appear to the Court sufficient to support the conviction might have been reasonably disbelieved by the jury in view of the demeanour of the witnesses." That a jury might properly have proceeded in this way may readily be acknowledged. But it by no means follows that it is useful to speak of the accused having a "right" to the verdict of a jury rather than a verdict of an appellate court. And the Privy Council in Makin did not go so far as to hold that the accused had such a right. Rather, as Isaacs J pointed out in Grills39, the Privy Council concluded only that where inadmissible evidence was introduced at trial "then notwithstanding there is sufficient evidence to sustain the verdict and show the accused was guilty, there is a substantial wrong or miscarriage of justice except where it is impossible to suppose the evidence improperly admitted could have any influence on the verdict" (emphasis added). One case of the latter kind (although not given as an example by Isaacs J) must be the case where, taken as a whole, the record of the trial reveals that the accused was shown, beyond reasonable doubt, to be guilty of the offence in respect of which the jury returned its guilty verdict. 37 [1894] AC 57 at 70. 38 [1894] AC 57 at 70. 39 (1910) 11 CLR 400 at 431. As Wigmore pointed out40, the conduct of jury trials has always been subject to the direction, control and correction both of the trial judge and the appellate courts. Once it is acknowledged that an appellate court may set aside a jury's verdict "on the ground that it is unreasonable or cannot be supported having regard to the evidence", it follows inevitably that the so-called "right" to the verdict of a jury rather than an appellate court is qualified by the possibility of appellate intervention. The question becomes, when is that intervention justified? And that, in turn, requires examination of when a court should conclude that "no substantial miscarriage of justice has actually occurred". Applying the proviso This Court has repeatedly emphasised the need, when applying a statutory provision, to look to the language of the statute rather than secondary sources or materials41. In Fleming v The Queen42, the Court said that "[t]he fundamental point is that close attention must be paid to the language" of the relevant criminal appeal statute because "[t]here is no substitute for giving attention to the precise terms" in which the relevant provision is expressed. Many statements are to be found in the decided cases that describe the task presented by the proviso as being to decide whether conviction was 40 A Treatise on the Anglo-American System of Evidence in Trials at Common Law, 3rd ed (1940), vol 1 at 369-370. 41 See, for example, Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 77 [9] per Gaudron, Gummow, Hayne and Callinan JJ, 89 [46] per Kirby J; Victorian Workcover Authority v Esso Australia Ltd (2001) 207 CLR 520 at 526 [11] per Gleeson CJ, Gummow, Hayne and Callinan JJ, 545 [63] per Kirby J; Commonwealth v Yarmirr (2001) 208 CLR 1 at 37-39 [11]-[15] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, 111-112 [249] per Kirby J; Visy Paper Pty Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 1 at 6-7 [7]-[9] per Gleeson CJ, McHugh, Gummow and Hayne JJ; Stevens v Kabushiki Kaisha Sony Computer Entertainment (2005) 79 ALJR 1850 at 1856 [30] per Gleeson CJ, Gummow, Hayne and Heydon JJ, 1877 [167]-[168] per Kirby J. 42 (1998) 197 CLR 250 at 256 [12]. "inevitable"43. Other cases44 ask whether the accused was deprived of a "chance which was fairly open … of being acquitted" or a "real chance" of acquittal. These expressions attempt to describe the operation of the statutory language in other words. They must not be taken as substitutes for that language. They are expressions which may mask the nature of the appellate court's task in considering the application of the proviso. Examination of the cases reveals that this danger of masking the nature of the appellate court's task is acute when the test to be applied is expressed by reference to what a jury would have done. Frequent reference is to be found in the cases to what "the jury"45, "a reasonable, and not a perverse, jury"46, "a jury of reasonable men, properly instructed and on such of the material as should properly be before them"47, would have done. Like the Court of Appeal in the present matter, the Donovan Committee concluded that it was important to distinguish between a test which refers to the trial jury and a test which refers to any reasonable jury. The Donovan Committee identified two conflicting views in the English cases about the way in which the proviso should be operated. The report of the Committee said48: "The one [way in which the proviso might be operated] is that the Court should try to assess the effect upon the mind of the trial jury if the fault had not occurred. In other words, suppose that the evidence wrongfully admitted had been excluded, or that the mistaken direction had not been 43 See, for example, Festa v The Queen (2001) 208 CLR 593 at 631 [121] per 44 See, for example, Mraz v The Queen (1955) 93 CLR 493 at 514 per Fullagar J; R v Storey (1978) 140 CLR 364 at 376 per Barwick CJ. 45 Woolmington v Director of Public Prosecutions [1935] AC 462 at 482-483 per 46 Mraz (1955) 93 CLR 493 at 515 per Fullagar J. 47 Storey (1978) 140 CLR 364 at 376 per Barwick CJ. 48 Report of the Interdepartmental Committee on the Court of Criminal Appeal, Cmnd 2755 at 35, par 152. given by the judge, must the jury who tried the appellant nevertheless have convicted him? The other is that the Court should itself decide the problem which the proviso sets; and should resolve it by reference to the test whether any reasonable jury properly instructed could upon the whole of the admissible evidence have done otherwise than convict." The Committee concluded49 that the debate between these views had been resolved, in England, by the decision of the House of Lords in Stirland v Director of Public Prosecutions50 and had been resolved in favour of the "reasonable jury" test. The Committee said51: "The Court does not try to assess what the particular jury which heard the case might or might not have done; nor whether that jury must have convicted even if the irregularity had not occurred. It assumes a reasonable jury and asks the question 'Could a reasonable jury, properly directed, have failed to convict?'" But as argument in the present appeal reveals, confining the debate about the meaning and operation of the proviso between a test referring to "this jury" and a test referring to "a reasonable jury properly instructed and on only the material that would properly be available" invites error. The fundamental task committed to the appellate court by the common form of criminal appeal statute is to decide the appeal. In so far as that task requires considering the proviso, it is not to be undertaken by attempting to predict what a jury (whether the jury at trial or some hypothetical future jury) would or might do. Rather, in applying the proviso, the task is to decide whether a "substantial miscarriage of justice has actually occurred". By hypothesis, when the proviso falls for consideration, the appellate court has decided that there was some irregularity at trial. If there was not, there is no occasion to consider the proviso. In cases, like the present, where evidence that should not have been adduced has been placed before the jury, it will seldom be possible, and rarely if ever profitable, to attempt to work out what the 49 Cmnd 2755 at 36-37, pars 159-161. 50 [1944] AC 315 at 321. 51 Cmnd 2755 at 37, par 161. members of the trial jury actually did with that evidence. In cases, like the present, where the evidence that has been wrongly admitted is evidence that is discreditable to the accused, it will almost always be possible to say that that evidence might have affected the jury's view of the accused, or the accused's evidence. And unless we are to return to the Exchequer rule (where any and every departure from trial according to law required a new trial) recognition of the possibility that the trial jury might have used wrongfully received evidence against the accused cannot be treated as conclusive of the question presented by the proviso. This may suggest that reference may be made to what a reasonable jury, properly instructed, would or might have done. That would at least make the inquiry objective and take away what might be said to be the element of speculation implicit in the "this jury" test. In some cases, no doubt, invocation of the jury, and what they would inevitably have done, may amount to nothing more than the appellate judges reminding themselves of the ordinary entitlement of an accused person to have serious criminal charges decided in the first instance by a jury – sometimes described as "the constitutional judge of fact"52. In some cases, the jury may have been mentioned because appellate judges wished to remind themselves of the need to apply the criminal standard of proof, a task commonly reserved in serious criminal trials to a jury. In still other cases, the reference may have been made by the appellate judges to remind themselves of the special features that attend the trial of serious criminal accusations before a jury whose verdicts are inscrutable but final, and sometimes reflect consideration of practical wisdom in deciding multiple issues presented by complex evidence. Occasionally, reference to the jury might have been invoked in an endeavour to clothe the conclusion of the appellate judges in the apparel of a jury verdict, so as to attract to the appellate judgment the respect and finality conventionally accorded to jury verdicts. However this may be, as the present case illustrates, difficulties can arise in applying such tests, at least in cases where conflicting evidence has been given at trial. Is it enough to notice, as was noticed in the present case53, that another jury might take a different view of the credibility of witnesses from that 52 Hocking v Bell (1945) 71 CLR 430 at 440 per Latham CJ quoting Lord Wright in Mechanical and General Inventions Co Ltd v Austin [1935] AC 346 at 373. 53 R v Weiss (2004) 8 VR 388 at 401, footnote 69. apparently taken at trial, in order to conclude that the proviso does not apply? Taken to its logical conclusion such an approach would again tend to readopting the Exchequer rule, for it would preclude applying the proviso in any case in which there was a substantial factual controversy at trial. Yet as the history of the criminal appeal provisions reveals, the legislative objective in enacting the proviso was to do away with the Exchequer rule and the language of the proviso is apt to achieve that objective. Three fundamental propositions must not be obscured. First, the appellate court must itself decide whether a substantial miscarriage of justice has actually occurred. Secondly, the task of the appellate court is an objective task not materially different from other appellate tasks. It is to be performed with whatever are the advantages and disadvantages of deciding an appeal on the record of the trial; it is not an exercise in speculation or prediction. Thirdly, the standard of proof of criminal guilt is beyond reasonable doubt. Reference to inevitability of result (or the converse references to "fair" or "real chance of acquittal") are useful as emphasising the high standard of proof of criminal guilt. They are also useful if they are taken as pointing to "the 'natural limitations' that exist in the case of any appellate court proceeding wholly or substantially on the record"54. But reference to a jury (whether the trial jury or a hypothetical reasonable jury) is liable to distract attention from the statutory task as expressed by criminal appeal statutes, in this case, s 568(1) of the Crimes Act. It suggests that the appeal court is to do other than decide for itself whether a substantial miscarriage of justice has actually occurred55. The statutory task and the proviso That task is to be undertaken in the same way an appellate court decides whether the verdict of the jury should be set aside on the ground that it is unreasonable, or cannot be supported having regard to the evidence. The 54 Fox v Percy (2003) 214 CLR 118 at 125-126 [23] per Gleeson CJ, Gummow and 55 cf Favell v Queensland Newspapers Pty Ltd (2005) 79 ALJR 1716 at 1720 [11] per Gleeson CJ, McHugh, Gummow and Heydon JJ, 1722-1723 [23]-[24] per Kirby J. appellate court must make its own independent assessment of the evidence56 and determine whether, making due allowance for the "natural limitations" that exist in the case of an appellate court proceeding wholly or substantially on the record57, the accused was proved beyond reasonable doubt to be guilty of the offence on which the jury returned its verdict of guilty. There will be cases, perhaps many cases, where those natural limitations require the appellate court to conclude that it cannot reach the necessary degree of satisfaction. In such a case the proviso would not apply, and apart from some exceptional cases, where a verdict of acquittal might be entered, it would be necessary to order a new trial. But recognising that there will be cases where the proviso does not apply does not exonerate the appellate court from examining the record for itself. It is neither right nor useful to attempt to lay down absolute rules or singular tests that are to be applied by an appellate court where it examines the record for itself, beyond the three fundamental propositions mentioned earlier. (The appellate court must itself decide whether a substantial miscarriage of justice has actually occurred; the task is an objective task not materially different from other appellate tasks; the standard of proof is the criminal standard.) It is not right to attempt to formulate other rules or tests in so far as they distract attention from the statutory test. It is not useful to attempt that task because to do so would likely fail to take proper account of the very wide diversity of circumstances in which the proviso falls for consideration. There are, however, some matters to which particular attention should be drawn. First, the appellate court's task must be undertaken on the whole of the record of the trial including the fact that the jury returned a guilty verdict. The court is not "to speculate upon probable reconviction and decide according to how the speculation comes out"58. But there are cases in which it would be possible to conclude that the error made at trial would, or at least should, have 56 Driscoll v The Queen (1977) 137 CLR 517 at 524-525 per Barwick CJ; Storey (1978) 140 CLR 364 at 376 per Barwick CJ; Morris v The Queen (1987) 163 CLR 454; M v The Queen (1994) 181 CLR 487; Festa (2001) 208 CLR 593 at 631-633 57 Fox v Percy (2003) 214 CLR 118 at 125-126 [23] per Gleeson CJ, Gummow and 58 Kotteakos v United States 328 US 750 at 763 (1946). had no significance in determining the verdict that was returned by the trial jury. The fact that the jury did return a guilty verdict cannot be discarded from the appellate court's assessment of the whole record of trial. Secondly, it is necessary always to keep two matters at the forefront of consideration: the accusatorial character of criminal trials such as the present59 and that the standard of proof is beyond reasonable doubt. Next, the permissive language of the proviso ("the Court … may, notwithstanding that it is of opinion that the point raised in the appeal might be decided in favour of the appellant, dismiss the appeal …") is important. So, too, is the way in which the condition for the exercise of that power is expressed ("if it considers that no substantial miscarriage of justice has actually occurred"). No single universally applicable description of what constitutes "no substantial miscarriage of justice" can be given. But one negative proposition may safely be offered. It cannot be said that no substantial miscarriage of justice has actually occurred unless the appellate court is persuaded that the evidence properly admitted at trial proved, beyond reasonable doubt, the accused's guilt of the offence on which the jury returned its verdict of guilty. Likewise, no single universally applicable criterion can be formulated which identifies cases in which it would be proper for an appellate court not to dismiss the appeal, even though persuaded that the evidence properly admitted at trial proved, beyond reasonable doubt, the accused's guilt. What can be said, however, is that there may be cases where it would be proper to allow the appeal and order a new trial, even though the appellate court was persuaded to the requisite degree of the appellant's guilt. Cases where there has been a significant denial of procedural fairness at trial may provide examples of cases of that kind. It is unnecessary in this appeal to examine that issue further, or to consider the related question whether some errors or miscarriages of justice occurring in the course of a criminal trial may amount to such a serious breach of the presuppositions of the trial as to deny the application of the common form criminal appeal provision with its proviso60. It is also unnecessary to decide in 59 RPS v The Queen (2000) 199 CLR 620 at 630 [22] per Gaudron ACJ, Gummow, 60 See, for example, Wilde v The Queen (1988) 164 CLR 365 at 373; cf Conway v The Queen (2002) 209 CLR 203 at 241 [103] per Kirby J referring to R v Hildebrandt (Footnote continues on next page) this case whether, and if so how, the provisions of s 80 of the Constitution, obliging trial by jury in the trial on indictment of an offence against any law of the Commonwealth, imports minimum requirements into the elements of such a trial which, in particular circumstances, could not be saved by the provision of State or Territory law expressed in terms of the common form of criminal appeal provision considered in this case. The appellant's trial was conducted wholly within State jurisdiction and so was the disposition of the appeal by the Court of Appeal. No federal question therefore arises, still less any question presented by s 80 of the Constitution. That an appellate court must review the whole record of trial when it is required to consider the application of the proviso may be said to tend to prolong appellate hearings and increase the burden on already overburdened intermediate appellate courts. The immediate answer to that proposition must be that it is what the common form criminal appeal provision requires. But no less importantly, the proviso, properly applied, will, in cases to which it is applicable, avoid the needless retrial of criminal proceedings61. The present case The Court of Appeal approached its task in the present case by asking what the trial jury would have done had the wrongly admitted evidence not been before it. Approaching the task in that way was to divert attention from the question presented by the proviso and may (we do not say must) have led the Court of Appeal to a wrong conclusion about the application of the proviso in this case. Counsel for the respondent submitted on the hearing of the appeal in this Court that the appropriate start to the chain of reasoning that should have been followed by the Court of Appeal was that the trial jury must have accepted certain evidence given at trial in preference to that given by the appellant. If that was the premise from which the Court of Appeal began its consideration of (1963) 81 WN (Pt 1) (NSW) 143 at 148 per Herron CJ; R v Henderson [1966] VR 41 at 43 per Winneke CJ; Couper (1985) 18 A Crim R 1 at 7-8 per Street CJ. 61 cf Pound, "The Causes of Popular Dissatisfaction with the Administration of Justice", (1937) 20 Journal of the American Judicature Society 178 at 185-186. whether the proviso applied, it was a premise whose validity was the very question presented by the proviso. It may readily be accepted that the trial jury did accept the evidence given against the appellant and rejected his contrary evidence. But for the reasons given earlier, the possibility that the jury took account of the wrongly admitted evidence in deciding what evidence to accept or reject cannot be excluded. If the wrongly admitted evidence was taken into account in reaching a conclusion about what other evidence to accept, the conclusion actually reached by the trial jury would not provide a sound basis for reaching a conclusion about whether guilt had been proved beyond reasonable doubt. It is wrong to begin an examination of whether a substantial miscarriage of justice has actually occurred by accepting, as necessarily correct, the preference by the jury for some controverted evidence when that preference may have been affected by the error that was made at trial. Rather, it is necessary to look beyond what the jury may be assumed to have accepted and for the Court, so far as it properly can, to judge the evidence for itself. That is best done in this case by focusing first upon the chief evidence against the appellant – his alleged admissions – rather than exclusively or mainly upon the two questions and answers that mentioned Renée's age which must necessarily be considered in the context of the whole trial. The appellant was alleged to have made two confessions that he had killed Ms Grey. Evidence of one of those alleged confessions was given by Ms Horstead. Ms Horstead's evidence in this regard was hotly contested. The appellant denied that he had made the statements she alleged he had made. He sought to establish that she was a disappointed and bitter woman who, once the appellant had taken up with Renée, and Ms Horstead's relationship with the appellant had ended, had set out, in her own words, to achieve the conviction of the appellant. But there was a further set of confessional material which was much more difficult for the appellant to deal with. When first interviewed by police in November 2000 (after Ms Horstead had given police what she was later to swear was the true account of what had happened four years earlier, when Ms Grey was killed) the appellant made no admission and denied any involvement in Ms Grey's death. About 45 minutes after that interview finished he was interviewed again. In this second interview he admitted that he had visited Ms Grey on the night she was killed, that they had quarrelled and that he had struck her with a cricket bat. He admitted that he may have hit her more than once. (He said he thought that he had hit her once or twice but that it may have been more often.) He admitted that, at the scene, he had stripped the rubber grip from the handle of the bat he had used to hit Ms Grey, and had thrown the grip away on his way home from Ms Grey's house. While he denied that he had intended to hit Ms Grey, the statements he made in this interview, if accepted as true, taken with the evidence of the pathologist about the number and ferocity of the blows struck, could have supported his conviction for murder. Both interviews with police were videotaped and admitted in evidence at the appellant's trial. The appellant's case at trial was that the confessions he made in the second interview were false. He sought to explain his saying what he did in the second interview by asserting that a police officer, Detective Sergeant Dean Thomas (with whom he had had earlier dealings when charged with theft), had told him, or at least suggested to him, that, if he confessed to the killing, an otherwise inevitable conviction for murder could be avoided and a plea of guilty of manslaughter accepted by the authorities. Detective Thomas did not take any part in the first interview with the appellant. He gave an altogether different account of the conversation he had with the appellant after the first interview had ended. He said that the appellant, having asked to see him, told him that he wanted to confess. And on the face of the transcript of the interview there is much that would not be inconsistent with such an account of what went on in the interval between the two interviews. But, of course, the interview having been videotaped, it was available to the Court of Appeal, and that Court could make its own judgment about what, if anything, the second interview, judged against the transcript of all else that was said at trial, revealed about the appellant's guilt. In undertaking that task, the Court of Appeal would know that the jury at trial had concluded, beyond reasonable doubt, that the appellant had made confessional statements that were true. There was no doubt that he had made confessional statements to the police. The jury, and the Court of Appeal, had the video recording of those statements. The jury may also have concluded that the statements he was alleged to have made to Ms Horstead were in fact made and were true. The Court of Appeal would also know that the jury at trial would most likely have rejected the appellant's account of his conversation with Neither counsel nor the trial judge had invited the jury to conclude that the appellant's evidence at trial could more easily be rejected by the jury because he was a man of poor character. There was a deal of evidence that revealed the appellant had done discreditable things with Renée, when under-age. On the appellant's own account of his dealings with Detective Thomas, he had asked to see him because he was a police officer who had dealt fairly with him when he was investigated for, and ultimately charged with, theft. There was frequent reference at trial to the appellant and others using drugs. And there was, of course, the evidence of his forming and maintaining a relationship with Renée. The possibility that any or all of these matters had been considered by the jury and taken into account against the appellant cannot be excluded. But one question for the Court of Appeal was whether, considering all of the evidence at trial, these matters of character could be put aside as unimportant side issues when viewed in the context of the whole trial, particularly as the evidence in the trial included the powerful testimony of confessions to police which the appellant did not contest making, although he sought to explain how they came about. If they could, attention could focus upon whether the videotaped confession (which the appellant had undoubtedly made) established, beyond reasonable doubt, his guilt of murder. Or was there a reasonable possibility that he had made a false confession? These questions were not addressed in argument of the present appeal. Argument was confined to the point of principle revealed by the Court of Appeal's reasons. This Court does not have the whole record of the trial. Even if it did, it would be far preferable that the record first be considered by the Court of Appeal than examined for the first time in this Court. It may be that on examining the whole of the record of the trial, the Court of Appeal will not be persuaded to the requisite standard that, allowing for the natural limitations on an appellate court, what the appellant said in his second interview with police can be accepted as proving, beyond reasonable doubt, his guilt of murder. But that is a question that the Court of Appeal has not yet addressed. The matter should be remitted for that Court's further consideration. That reconsideration must take place because, in applying the proviso to s 568(1) of the Crimes Act, the Court of Appeal erred when the reasons that it gave are considered by reference to language of the Crimes Act expressing that Court's appellate duty. Conclusion and orders For these reasons, the appeal should be allowed, the orders of the Court of Appeal of the Supreme Court of Victoria made on 5 May 2004 should be set aside and the matter remitted to the Court of Appeal for its further consideration.
HIGH COURT OF AUSTRALIA APPELLANT AND DEPARTMENT OF IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS & ORS RESPONDENTS Al-Kateb v Godwin [2004] HCA 37 6 August 2004 ORDER 1. Appeal dismissed. 2. The respondents to pay the appellant's costs in this Court. Cause removed under s 40 of the Judiciary Act 1903 (Cth) Representation: C M O'Connor with A Hamdan for the appellant (instructed by Hamdan Lawyers) D M J Bennett QC, Solicitor-General of the Commonwealth with H C Burmester QC and S J Maharaj for the respondents (instructed by Australian Government Solicitor) Interveners: D M J Bennett QC, Solicitor-General of the Commonwealth with H C Burmester QC and S J Maharaj intervening on behalf of the Attorney- General of the Commonwealth (instructed by Australian Government Solicitor) D S Mortimer SC with J K Kirk intervening on behalf of the Human Rights and Equal Opportunity Commission (instructed by Human Rights and Equal Opportunity Commission) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Immigration – Unlawful non-citizens – Detention pending removal from Australia – No real prospect of removal from Australia in reasonably foreseeable future – Whether detention lawful under Migration Act 1958 (Cth) – Whether detention is temporally limited by purpose of removal – Whether requirement to remove as soon as reasonably practicable implies time limit on detention. Statutes – Acts of Parliament – Construction and interpretation – Where meaning ambiguous or uncertain – Presumption of legislative intention not to invade personal common law rights. Constitutional law (Cth) – Judicial power of the Commonwealth – Unlawful non-citizen in immigration detention – No real prospect of removal from Australia in reasonably foreseeable future – Whether provision for indefinite detention without judicial order infringes Chapter III of the Constitution – Whether detention involves an exercise of judicial power of the Commonwealth by the Executive – Whether detention is for a non-punitive purpose. law (Cth) – Construction and Constitutional interpretation – Whether Constitution to be interpreted to be consistent with international law of human rights and fundamental freedoms. Constitution, Ch III. Migration Act 1958 (Cth), ss 189, 196, 198. GLEESON CJ. The Migration Act 1958 (Cth) ("the Act") provides for administrative detention of unlawful non-citizens. For present purposes, unlawful non-citizens are aliens who have entered Australia without permission, or whose permission to remain in Australia has come to an end. In this context, alien includes a stateless person, such as the appellant. Detention is mandatory, not discretionary. It is not a form of extra-judicial punishment. It exists "in the context ... of executive powers to receive, investigate and determine an application by [the] alien for an entry permit and (after determination) to admit or deport"1. It is an incident of the exercise of those powers. The Act envisages that the detention will come to an end, by the grant of a visa which entitles the alien to enter the Australian community, or by removal of the alien from Australia, either at the request of the alien, or following the conclusion of an unsuccessful attempt to obtain a visa. Applications for visas may involve a lengthy process of decision-making, and administrative and judicial review. The time taken by the process may be difficult to predict. In that respect, the period of administrative detention may be uncertain. Similarly, the process of removal may take some time to arrange. In the ordinary case, however, the period, although uncertain, is finite. Furthermore, as was pointed out in Chu Kheng Lim v Minister for Immigration, in the ordinary case, the detention can be brought to an end upon the alien making a request to be removed2. There are, however, exceptional cases, where a visa application has been determined adversely to an alien, or an alien has requested removal, but removal is not possible in the circumstances which prevail at the time and which are likely to prevail in the foreseeable future. What happens then? Is the consequence indefinite, perhaps permanent, detention? The Act does not, in express terms, address that problem3. The appellant, a stateless person, arrived in Australia without a visa. He was taken into immigration detention, and applied for a visa. His application failed. He wrote to the Minister requesting to be removed. Removal did not take place, not because of any want of trying on the part of the Australian authorities, or because of any personal fault of the appellant, but because attempts to obtain the necessary international co-operation were unsuccessful. The Federal Court found that there was no real likelihood or prospect of removal of the appellant in the reasonably foreseeable future. 1 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 10 per Mason CJ. (1992) 176 CLR 1 at 34 per Brennan, Deane and Dawson JJ. 3 Amendments to s 196 of the Act in 2003 apply to certain classes of detainee, not including the appellant. In a similar case, Minister for Immigration and Multicultural and Indigenous Affairs v Al Masri4, the Full Court of the Federal Court held that a person in the position of the appellant is entitled to be released from immigration detention, if and when the purpose of removal becomes incapable of fulfilment. For the reasons that follow, I agree with that conclusion. A similar problem has arisen, and a similar answer has been given, in the United Kingdom5, the United States6, and Hong Kong7. However, in each country the constitutional and statutory context is controlling, and differs. In particular, while in those jurisdictions provision is made for administrative detention of aliens, such detention is discretionary rather than mandatory, and the courts are concerned with powers, rather than obligations, to detain. Questions of reasonableness in the exercise of administrative powers may give rise to considerations that are not directly relevant to a system of mandatory detention. In Australia, the constitutional context is as follows. The Parliament, subject to the Constitution, has power to make laws with respect to naturalization and aliens (s 51(xix)), and immigration and emigration (s 51(xxvii)). The qualification, subject to the Constitution, directs attention to Ch III, concerning judicial power and courts, and the separation of powers which is part of the structure of the Constitution. Parliament has no power to make laws with respect to aliens which confer judicial power on the Executive. The Act's scheme of mandatory administrative detention is a valid law with respect to aliens on the basis earlier stated, that is to say, that a limited authority to detain an alien in custody is conferred as an incident of the exercise of the executive powers of excluding and removing aliens, and investigating, considering and determining applications for permission to enter Australia8. So characterised, the power is not punitive in nature, and does not involve an invalid attempt to confer on the Executive a power to punish people who, being in Australia, are subject to, and entitled to the protection of, the law. The history of the relevant provisions of the Act, and of earlier legislation on the subject, is set out in the reasons of Gummow J and of Hayne J. The critical provisions are ss 189, 196, and 198 which are contained in Pt 2 dealing with "Control of arrival and presence of non-citizens". Division 7 of Pt 2, which (2003) 126 FCR 54. 5 R v Governor of Durham Prison; Ex parte Hardial Singh [1984] 1 WLR 704; [1984] 1 All ER 983. 6 Zadvydas v Davis 533 US 678 (2001). 7 Tan Te Lam v Superintendent of Tai A Chau Detention Centre [1997] AC 97. 8 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 10 per Mason CJ. contains ss 189 and 196, deals with "Detention of unlawful non-citizens" – those without visas. Division 8 of Pt 2, which contains s 198, deals with "Removal of unlawful non-citizens". Section 198 provides: "(1) An officer must remove as soon as reasonably practicable an unlawful non-citizen who asks the Minister, in writing, to be so removed. (6) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: the non-citizen is a detainee; and the non-citizen made a valid application for a substantive visa that can be granted when the applicant is in the migration zone; and the grant of the visa has been refused and the application has been finally determined; ... and the non-citizen has not made another valid application ..." Both sub-ss (1) and (6) apply in the case of the appellant. Removal is not necessarily limited to removal to an unlawful non-citizen's country of nationality. However, it does not include simply ejecting a person physically from Australian territory, and therefore, in a given case, may require international co-operation as mentioned above. Section 189 provides that, if an officer knows or reasonably suspects that a person in the migration zone is an unlawful non-citizen, the officer must detain the person. Section 196, dealing with the period of detention, provides: "(1) An unlawful non-citizen detained under section 189 must be kept in immigration detention until he or she is: removed from Australia under section 198 or 199; or deported under section 200; or granted a visa. To avoid doubt, subsection (1) does not prevent the release from immigration detention of a citizen or a lawful non-citizen. To avoid doubt, subsection (1) prevents the release, even by a court, of an unlawful non-citizen from detention (otherwise than for removal or deportation) unless the non-citizen has been granted a visa." The word "detention" in sub-s (3) means "lawful detention". If it were otherwise, the provision would constitute an unconstitutional interference with judicial power9. Parliament cannot deprive the courts of the power to order the release of a person from unlawful detention. Consequently, it is the meaning of sub-s (1), understood in its constitutional and statutory context, that is in question. The appellant was taken into detention under s 189, and was to be kept in detention under s 196 until he was removed from Australia under s 198 or granted a visa. He was not granted a visa, and he requested to be removed. Section 198 required that he be removed as soon as reasonably practicable. He wanted to be removed. The authorities wanted to remove him. But removal was not practicable, and was not likely to be practicable in the foreseeable future. One of the features of a system of mandatory, as distinct from discretionary, detention is that circumstances personal to a detainee may be irrelevant to the operation of the system. A person in the position of the appellant might be young or old, dangerous or harmless, likely or unlikely to abscond, recently in detention or someone who has been there for years, healthy or unhealthy, badly affected by incarceration or relatively unaffected. The considerations that might bear upon the reasonableness of a discretionary decision to detain such a person do not operate. The Act is expressed in terms which appear to assume the possibility of compliance with the unqualified statutory obligation imposed by s 198. That assumption is made the basis of the specification of the period of detention required and authorised by s 196. The period is expressed to be finite. In cases where the assumption is valid, the period of mandatory detention may be relatively brief, save to the extent that it is prolonged by a detainee's own action in seeking a visa, with the delays that may involve. And, where the assumption is valid, the detention can always be brought to an end by the detainee's own request for removal. As the facts of the present case illustrate, however, compliance with the unqualified statutory obligation may require the co-operation of others, whose co-operation cannot be 9 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 50-51 per compelled. Compliance with an obligation defines the period of detention. The obligation, however, in its nature is subject to the possibility that it cannot be fulfilled for reasons unrelated to any fault on the part of the detainer, or the detainee. The respondents point out that the capacity of a court to investigate, and decide, the practicability of removal in some cases where delicate, and perhaps confidential, matters of international diplomacy are concerned, may be limited. That is true, but if there were an allegation of non-compliance with the obligation imposed by s 198, that would give rise to a justiciable issue, difficult though it may be to resolve. The respondents also point out that international circumstances change, sometimes rapidly and unpredictably, and that it will rarely, if ever, be possible to say that removal will never become practicable. Even so, the provisions of the Act with which we are concerned do not address the possibility of a situation such as has arisen in the present case, and do not expressly provide for it. It should be acknowledged that the same may be said of some statements in past judgments of this Court as to the purpose and character of immigration detention. The Act does not in terms provide for a person to be kept in administrative detention permanently, or indefinitely. A scheme of mandatory detention, operating regardless of the personal characteristics of the detainee, when the detention is for a limited purpose, and of finite duration, is one thing. It may take on a different aspect when the detention is indefinite, and possibly for life. In its application to the appellant, the Act says that he is to be kept in administrative detention until he is removed, and that he is to be removed as soon as reasonably practicable. That could mean that the appellant is to be kept in administrative detention for as long as it takes to remove him, and that, if it never becomes practicable to remove him, he must spend the rest of his life in detention. The appellant contends that it is also capable of another meaning. It may mean that the appellant, who is being kept in detention for the purpose of removal, which must take place as soon as reasonably practicable, is to be detained if, and so long as, removal is a practical possibility, but that if, making due allowance for changes in circumstances, removal is not a practical possibility, then the detention is to come to an end, at least for so long as that situation continues. The respondents dispute that the Act is capable of bearing the second of those two meanings. That issue cannot be divorced from the words of qualification at the end of the preceding paragraph. The qualification also is contestable, and must be addressed. It was submitted on behalf of the respondents that the Minister, and the relevant officers referred to in s 198, may have the purpose of removing a detainee as soon as reasonably practicable, in accordance with their statutory obligations, even though removal is not currently practicable, and is not likely to become practicable in the foreseeable future. They may have such a purpose for years. They may have it for the whole of a detainee's life. The legislation operates, with reference to the appellant, upon the combined effect of two imperatives. He must be removed from Australia as soon as reasonably practicable. And he must be detained until he is so removed. The first imperative is compound in its nature. It assumes the possibility of removal. It requires, not merely removal, but removal as soon as reasonably practicable. The second imperative, which builds upon the first, is, in terms, unqualified. As a matter of ordinary language, it is open to the construction that, because of its textual relationship to the first imperative, it is subject to a cognate qualification. This is supported by the purposive nature of the power (and duty) of administrative detention. The primary purpose of the appellant's detention, after the completion of the process of examining his application for a visa and after his request that he be removed, was to facilitate his removal. A secondary purpose may well have been to prevent his entry into the Australian community in the meantime. The primary purpose, however, is plain. The purpose is objective. What is in question is the purpose of the detention, not the motives or intention of the Minister, or the officers referred to in s 198. If the second imperative is qualified by its relationship with the first imperative, another question follows as to the precise extent of the qualification. Although the non-citizens referred to in s 196 will possess a variety of personal characteristics, some of which, in a discretionary system, may justify prolonged detention, they all have one thing in common. They are "unlawful". That means they do not have permission to enter, or remain in, Australia. That is their status under the Act, whether in or out of immigration detention. And, in the case of the appellant, a time may come where his removal, by reason of a change in international circumstances, is reasonably practicable. It cannot be said that it will never be reasonably practicable to remove him. The primary purpose of his detention is in suspense, but it has not been made permanently unattainable. The Act makes no express provision for suspension, and possible revival, of the obligation imposed by s 196, according to the practicability of effecting removal under s 198. Similarly, it makes no express provision for indefinite, or permanent, detention in a case where the assumption underlying s 198 (the reasonable practicability of removal) is false. In resolving questions raised by the legislative silence, resort can, and should, be had to a fundamental principle of interpretation. Where what is involved is the interpretation of legislation said to confer upon the Executive a power of administrative detention that is indefinite in duration, and that may be permanent, there comes into play a principle of legality, which governs both Parliament and the courts. In exercising their judicial function, courts seek to give effect to the will of Parliament by declaring the meaning of what Parliament has enacted. Courts do not impute to the legislature an intention to abrogate or curtail certain human rights or freedoms (of which personal liberty is the most basic) unless such an intention is clearly manifested by unambiguous language, which indicates that the legislature has directed its attention to the rights or freedoms in question, and has consciously decided upon abrogation or curtailment. That principle has been re-affirmed by this Court in recent cases10. It is not new. In 1908, in this Court, O'Connor J referred to a passage from the fourth edition of Maxwell on Statutes which stated that "[i]t is in the last degree improbable that the legislature would overthrow fundamental principles, infringe rights, or depart from the general system of law, without expressing its intention with irresistible clearness"11. A statement concerning the improbability that Parliament would abrogate fundamental rights by the use of general or ambiguous words is not a factual prediction, capable of being verified or falsified by a survey of public opinion. In a free society, under the rule of law, it is an expression of a legal value, respected by the courts, and acknowledged by the courts to be respected by Parliament. It is submitted for the respondents that the terms of the statute are general, but tolerably clear, and that if there is a silence on the particular problem raised by the case of the appellant, that is only because it is sufficiently covered by the general words. I am unable to accept that submission. The Act provides that the appellant must be kept in detention until he is removed from Australia under s 198, and s 198 provides that he must be removed as soon as reasonably practicable. The Act does not say what is to happen if, through no fault of his own or of the authorities, he cannot be removed. It does not, in its terms, deal with that possibility. The possibility that a person, regardless of personal circumstances, regardless of whether he or she is a danger to the community, and regardless of whether he or she might abscond, can be subjected to indefinite, and perhaps permanent, administrative detention is not one to be dealt with by implication. In s 196, the period of detention of the appellant is defined by reference to the fulfilment of the purpose of removal under s 198. If that purpose cannot be fulfilled, the choice lies between treating the detention as suspended, or as indefinite. In making that choice I am influenced by the general principle of interpretation stated above. I am also influenced by the consideration that the 10 Coco v The Queen (1994) 179 CLR 427; Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476 at 492 [30]. 11 Potter v Minahan (1908) 7 CLR 277 at 304. See also R v Secretary of State for the Home Department; Ex parte Pierson [1998] AC 539 at 587-589 per Lord Steyn; R v Secretary of State for the Home Department; Ex parte Simms [2000] 2 AC 115 at 131 per Lord Hoffmann. detention in question is mandatory, not discretionary. In a case of uncertainty, I would find it easier to discern a legislative intention to confer a power of indefinite administrative detention if the power were coupled with a discretion enabling its operation to be related to the circumstances of individual cases, including, in particular, danger to the community and likelihood of absconding. The absence of any reference to such considerations, to my mind, reinforces the assumption that the purpose reflected in s 196 (removal) is capable of fulfilment, and supports a conclusion that the mandated detention is tied to the validity of that assumption. If I am correct in saying that, in the case of the appellant, the invalidation of the assumption in s 198 suspends, but does not forever displace, the obligation imposed by s 196, there then arises the question of the nature of the relief to which a person in the position of the appellant is entitled. In the course of argument in this Court, a question was raised as to the practice, adopted by some members of the Federal Court (such as Merkel J12 and the Full Court in Al Masri, and Mansfield J on an interlocutory basis in the present case), of making an order for the release from detention but imposing conditions, such as notification of change of address, and reporting, designed to secure availability for detention and removal if and when removal becomes reasonably practicable. The appellant sought a declaration that he was unlawfully detained and an order in the nature of habeas corpus directing his release from detention. The reference to "an order in the nature of habeas corpus" may reflect a division of opinion in the Full Federal Court in Ruddock v Vadarlis13 as to whether, under s 23 of the Federal Court of Australia Act 1976 (Cth), read with s 39B of the Judiciary Act 1903 (Cth), the Federal Court has power to issue a writ of habeas corpus or to make an order in the nature of habeas corpus. That question was not argued before this Court, and nothing turns on it in the present appeal. Even if the power is best described as a power to make an order in the nature of habeas corpus, that is what was sought. Furthermore, on the matter of making orders on conditions, s 22 of the Federal Court of Australia Act is to be noted. The remedy of habeas corpus, or an order in the nature of habeas corpus, is a basic protection of liberty, and its scope is broad and flexible. "This, the 12 Al Masri v Minister for Immigration and Multicultural and Indigenous Affairs (2002) 192 ALR 609. 13 (2001) 110 FCR 491 at 509-514 per Black CJ, 517-518 per Beaumont J, 546-548 greatest and oldest of all the prerogative writs, is quite capable of adapting itself to the circumstances of the times."14 As to the interlocutory orders made by Mansfield J in the present case, it is worth remembering that an order of bail as an interlocutory step in habeas corpus proceedings is not uncommon. Indeed, a proceeding for habeas corpus was once the normal method of applying to the King's Bench for bail15. In R v Secretary of State for the Home Department; Ex parte Turkoglu16, Sir John Donaldson MR, with whom Croom-Johnson and Bingham LJJ agreed, said, in an immigration case, "[c]learly we could grant bail ancillary to or as part of proceedings for habeas corpus". The interlocutory orders in this case were made by consent; it is the power of the Federal Court to impose conditions as part of a final order for release from detention that is presently in question. As well as being used to obtain bail, habeas corpus proceedings were commonly brought in disputes relating to the custody of children, or matters concerning the mentally ill. In R v Greenhill17, Lord Denman CJ said: "When an infant is brought before the Court by habeas corpus, if he be of an age to exercise a choice, the Court leaves him to elect where he will go. If he be not of that age, and a want of direction would only expose him to dangers or seductions, the Court must make an order for his being placed in the proper custody." Speaking of an order to discharge under habeas corpus a person unlawfully detained as a lunatic, Coleridge J said, in R v Pinder; In re Greenwood18, that: "when, on the affidavits, it appears clear that the party confined is in such a state of mind that to set him at large would be dangerous either to the public or himself, it becomes a duty and is within the common law 14 R v Secretary of State for the Home Department; Ex parte Muboyayi [1992] QB 244 at 258 per Lord Donaldson of Lymington MR. As to the procedure in habeas corpus applications, see Clark and McCoy, Habeas Corpus: Australia, New Zealand, the South Pacific, (2000) at 200-219, and see also the orders made by this Court in Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 520, 528. 15 Sharpe, The Law of Habeas Corpus, 2nd ed (1989) at 128; In re Kray [1965] Ch 736 at 740. 16 [1988] QB 398 at 399. 17 (1836) 4 Ad & E 624 at 640 [111 ER 922 at 927]. 18 (1855) 24 LJQB 148 at 152. jurisdiction of the Court, or a member of it, to restrain him from his liberty, until the regular and ordinary means can be resorted to of placing him under permanent legal restraint." It is not antithetical to the nature of habeas corpus for an order to be made upon terms or conditions which relate directly to the circumstances affecting an applicant's right to be released from detention, and reflect temporal or other qualifications upon that right. The author of Antieau, The Practice of Extraordinary Remedies19 says, of the practice in the United States, that "[c]ourts can release petitioners on condition that they post bonds to act in indicated manners". Reference is made to United States ex rel Chong Mon v Day20, where, in 1929, a Federal judge ordered the discharge of a petitioner "on his filing bond in the sum of $500, conditioned that he will depart from the United States as a seaman on a foreign bound vessel within 30 days from the date of his release". The power given by s 22 of the Federal Court of Australia Act, to grant remedies on such terms and conditions as the Court thinks just, so that, as far as possible, all matters in contention between the parties may be completely and finally determined and all multiplicity of proceedings concerning any of those matters avoided, extends to the imposition of conditions designed to ensure an unlawful non-citizen's availability for removal if and when that becomes reasonably practicable. A more difficult question, which does not arise in the present case, concerns the power of a court to impose conditions or restraints in the case of a person who is shown to be a danger to the community, or to be likely to abscond. It may be that the reason for difficulty in arranging for the removal of a detainee is that the detainee is regarded by his country of nationality, and other countries, as a dangerous person. Whether that could affect the detainee's right to be released from administrative detention, or the terms and conditions of release, is a matter that could arise for decision in another case. The appeal should be allowed with costs. I agree with the consequential orders proposed by Gummow J. 19 (1987), vol 1 at 41. 20 36 F 2d 278 at 279 (1929). McHugh 31 McHUGH J. The principal issue in this appeal concerns the power of the Parliament to order the detention of an unlawful non-citizen in circumstances where there is no prospect of him being removed from Australia in the reasonably foreseeable future. There is also an important point of statutory construction involved in the case that is anterior to the principal issue. Hence, the appeal raises two issues. First, do ss 189, 196 and 198 of the Migration Act 1958 (Cth) ("the Act"), when properly construed, purport to authorise the indefinite detention of an unlawful non-citizen in circumstances where there is no real prospect of removing the non-citizen? Second, if they do purport to authorise such detention, are they invalid because they are beyond the legislative power of the Commonwealth? In my opinion, the first issue should be resolved in the affirmative and the second in the negative. As a result, tragic as the position of the appellant certainly is, his appeal must be dismissed. The material facts of the case are set out in the judgment of Gummow J. I need not repeat them. First issue For the reasons given by Hayne J, ss 189, 196 and 198 of the Act require Mr Al-Kateb to be kept in immigration detention until he is removed from Australia. The words of ss 196 and 198 are unambiguous. They require the indefinite detention of Mr Al-Kateb, notwithstanding that it is unlikely that any country in the reasonably foreseeable future will give him entry to that country. The words of the three sections are too clear to read them as being subject to a purposive limitation or an intention not to affect fundamental rights. Detention under s 196 for the purpose of removal under s 198 will cease to be detention for that purpose only when the detention extends beyond the time when the removal of the non-citizen has become "reasonably practicable". As long as removal of an unlawful non-citizen is not reasonably practicable, ss 196 and 198 require that person's detention to continue until it is reasonably practicable or that person is given a visa. Minimising the time that an unlawful non-citizen must spend in detention was undoubtedly the reason for providing a time limit for removal or deportation. But that does not mean that the detention of an unlawful non-citizen is limited to a maximum period expiring when it is impracticable to remove or deport the person. The unambiguous language of s 196 – particularly sub-s (3) – indicates that Parliament intends detention to continue until one of the conditions expressly identified therein – removal, deportation or granting of a visa – is satisfied. McHugh Second issue In Chu Kheng Lim v Minister for Immigration21, the Court decided that the power conferred on the Parliament by s 51(xix) of the Constitution extends to authorising the executive government to detain an alien in custody for the purpose of expulsion or deportation. It also decided that detention for that purpose does not infringe the provisions of Ch III of the Constitution. The ratio decidendi of the case is expressed in the following passage in the joint judgment of Brennan, Deane and Dawson JJ22: "It can therefore be said that the legislative power conferred by s 51(xix) of the Constitution encompasses the conferral upon the Executive of authority to detain (or to direct the detention of) an alien in custody for the purposes of expulsion or deportation. Such authority to detain an alien in custody, when conferred upon the Executive in the context and for the purposes of an executive power of deportation or expulsion, constitutes an incident of that executive power. By analogy, authority to detain an alien in custody, when conferred in the context and for the purposes of executive powers to receive, investigate and determine an application by that alien for an entry permit and (after determination) to admit or deport, constitutes an incident of those executive powers. Such limited authority to detain an alien in custody can be conferred on the Executive without infringement of Ch III's exclusive vesting of the judicial power of the Commonwealth in the courts which it designates. The reason why that is so is that, to that limited extent, authority to detain in custody is neither punitive in nature nor part of the judicial power of the Commonwealth. When conferred upon the Executive, it takes its character from the executive powers to exclude, admit and deport of which it is an incident." This passage does not mean that the power to detain pending deportation is an incidental constitutional power, that is, a power that is merely incidental to the aliens power. Incidental powers, unlike true heads of s 51 power, operate in a space between the powers expressly granted and those not expressly granted to the Parliament. Incidental powers may only be exercised where they are reasonably necessary to facilitate the making of laws with respect to the head of power of which they are an incident. In a Constitution that grants limited powers to the federal legislature, they are, in a sense, additional to what was granted. Their 21 (1992) 176 CLR 1. 22 (1992) 176 CLR 1 at 32. McHugh connection with a head of power is closely scrutinised because they involve the acquisition of additional legislative power, not expressly granted to the Commonwealth by the Constitution. In using the term "incident" in the above passage, however, Brennan, Deane and Dawson JJ were describing an event that occurs in the course of the executive government's authority to deport or expel. They were not speaking of a measure of constitutional power. They were not speaking of a true incidental power, that is, a power that stands outside the head of constitutional power but can be justified because it is necessary to protect or give effect to a constitutional power. The power to detain aliens is not an incidental power. It is not the same as a power to detain a person suspected of carrying a weapon on an overseas flight regulated under the trade and commerce power. Detaining such a person is not trade or commerce. If the Parliament confers power to detain such a suspect, it can only be justified as incidental to the trade and commerce power if it is necessary to protect persons, property or transactions involved in overseas commerce. A law authorising detention of an alien stands in a different category. It is a law with respect to the subject of aliens in the same way as a law requiring aliens to register with a government official is a law with respect to aliens. Such laws are not incidental to the aliens power. They deal with the very subject of aliens. They are at the centre of the power, not at its circumference or outside the power but directly operating on the subject matter of the power. Significantly in Lim, the joint judgment of Brennan, Deane and Dawson JJ said of the laws in question in that case23: to which "Their object and operation are, in the words of s 54J, to ensure that 'each non-citizen who is a designated person should be kept in custody until he or she' leaves Australia or is given an entry permit. They constitute, in their entirety, a law or laws with respect to the detention in custody, pending departure or the grant of an entry permit, of the class of As a matter of bare 'designated' aliens characterization, they are, in our view, a law or laws with respect to that class of aliens. As such, they prima facie fall within the scope of the legislative power with respect to 'aliens' conferred by s 51(xix). The question arises whether, nonetheless, their enactment was not authorized by that grant of legislative power by reason of some express or implied restriction or limitation to be found in the Constitution when read as a whole. For the plaintiffs, it is argued that such a restriction or limitation is implicit in Ch III's exclusive vesting of the judicial power of the Commonwealth in the courts which it designates." (emphasis added) they refer. 23 (1992) 176 CLR 1 at 26. McHugh In Lim, I said24 that the power conferred on the Parliament by s 51(xix) is "limited only by the description of the subject matter". In Re Patterson; Ex parte Taylor, I said that "as long as a person falls within the description of 'aliens', the power of the Parliament to make laws affecting that person is unlimited unless the Constitution otherwise prohibits the making of the law"25. In Lim, I also said that a law requiring detention of aliens for the purpose of deportation or processing of applications would not cease to be one with respect to aliens even if the detention went beyond what was necessary to effect those objects26. That is because any law that has aliens as its subject is a law with respect to aliens. If the power to detain aliens for the purpose of deportation was merely an incidental power, it would be impossible to justify the detention of an alien once it appeared that deportation could not be effected or could not be effected in the foreseeable future. But, as I have pointed out, the power to detain aliens is not a power incidental to the s 51(xix) head of power. It is a law with respect to the subject matter of that power. The principles expressed in the above passage in the joint judgment of Brennan, Deane and Dawson JJ in Lim do not become inapplicable, therefore, when the alien cannot be deported immediately. The detention of the alien remains a law with respect to the s 51(xix) power. Nor does the continued detention of a person who cannot be deported immediately infringe Ch III of the Constitution. Chapter III is always infringed where the detention of a person other than by a curial order – whatever the purpose of the detention – is authorised by a law of the Commonwealth and imposes punishment. However, a law authorising detention will not be characterised as imposing punishment if its object is purely protective. Ex hypothesi, a law whose object is purely protective will not have a punitive purpose. That does not mean, however, that a law authorising detention in the absence of a curial order, but whose object is purely protective, cannot infringe Ch III of the Constitution. Even a law whose object is purely protective will infringe Ch III if it prevents the Ch III courts from determining some matter that is a condition precedent to authorising detention. A law requiring the detention of the alien takes its character from the purpose of the detention. As long as the purpose of the detention is to make the alien available for deportation or to prevent the alien from entering Australia or 24 (1992) 176 CLR 1 at 64. 25 (2001) 207 CLR 391 at 424. 26 (1992) 176 CLR 1 at 65-66. McHugh the Australian community, the detention is non-punitive. The Parliament of the Commonwealth is entitled, in accordance with the power conferred by s 51(xix) and without infringing Ch III of the Constitution, to take such steps as are likely to ensure that unlawful non-citizens do not enter Australia or become part of the Australian community and that they are available for deportation when that becomes practicable. As Latham CJ pointed out in O'Keefe v Calwell27: "Deportation is not necessarily punishment for an offence. The Government of a country may prevent aliens entering, or may deport aliens ... Exclusion in such a case is not a punishment for any offence. Neither is deportation ... The deportation of an unwanted immigrant (who could have been excluded altogether without any infringement of right) is an act of the same character: it is a measure of protection of the community from undesired infiltration and is not punishment for any offence." (emphasis added) It is open to the Parliament, therefore, to enact legislation that requires unlawful non-citizens to be detained so as to ensure that they do not enter Australia or the Australian community and can be deported when, and if, it is practicable to do so. To hold that Parliament cannot do so would mean that any person who unlawfully entered Australia and could not be deported to another country could thwart the operation of the Migration Act. It would mean that such persons, by their illegal and unwanted entry, could become de facto Australian citizens unless the Parliament made it a criminal offence with a mandatory sentence for a person to be in Australia as a prohibited immigrant. However, passing such a law is not the only way that the Parliament can achieve the object of keeping unlawful non-citizens from entering the Australian community. If Parliament were forced to achieve its object of preventing entry by enacting such laws, form would triumph over substance. The unlawful non-citizen would still be detained in custody. The only difference between detention under such a law and the present legislation would be that the detention would be the result of a judicial order upon a finding that the person was a prohibited immigrant. In substance, the position under that hypothesis would be no different in terms of liberty from what it is under ss 189, 196 and 198. Under the hypothesis, the only issue for the court would be whether the person was a prohibited immigrant. Under the present legislation, the issue for the courts is whether the person is an unlawful non-citizen. A finding of being a prohibited immigrant or an unlawful non-citizen produces the same result – detention. The only difference is that in one case the detention flows by the court applying the legislation and making an order and in the other it flows from the direct operation of the Act. 27 (1949) 77 CLR 261 at 278. McHugh I cannot accept that the words "[t]he judicial power of the Commonwealth shall be vested in ... the High Court of Australia, and in such other federal courts as the Parliament creates, and in such other courts as it invests with federal jurisdiction" in s 71 of the Constitution prohibit the Parliament from legislating to require that unlawful non-citizens be detained until they can be deported. By implication, s 71, when read with ss 1 and 61 of the Constitution, prohibits the Parliament of the Commonwealth from exercising the judicial power of the Commonwealth. But to enact legislation that requires the detention of a person who unlawfully enters Australia until he or she is deported from Australia is not an exercise by the Parliament of the judicial power of the Commonwealth. It is no more an exercise of judicial power than is a law requiring enemy prisoners-of- war to be detained in custody until they are deported from Australia28. Nothing in ss 189, 196 or 198 purports to prevent courts, exercising federal jurisdiction, from examining any condition precedent to the detention of unlawful non-citizens. Nor is it possible to hold that detention of unlawful non- citizens – even where their deportation is not achievable – cannot be reasonably regarded as effectuating the purpose of preventing them from entering Australia or entering or remaining in the Australian community. Indeed, detention is the surest way of achieving that object. If the Parliament of the Commonwealth enacts laws that direct the executive government to detain unlawful non-citizens in circumstances that prevent them from having contact with members of or removing them from the Australian community, nothing in the Constitution – including Ch III – prevents the Parliament doing so. For such laws, the Parliament and those who introduce them must answer to the electors, to the international bodies who supervise human rights treaties to which Australia is a party and to history. Whatever criticism some – maybe a great many – Australians make of such laws, their constitutionality is not open to doubt. Nothing in the reasoning or the decision in Lim assists Mr Al-Kateb. In their joint judgment, Brennan, Deane and Dawson JJ said that laws detaining unlawful non-citizens pending deportation "will be valid laws if the detention which they require and authorize is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered"29. Their Honours went on to say that, "if the detention which [the impugned laws] require and authorize is not so limited ... they will be of a punitive nature and contravene Ch III's insistence that the judicial power of the Commonwealth be vested exclusively in the courts which it designates"30. In Lim, I said that, if "a law 28 See later in these reasons at [55]-[61]. 29 (1992) 176 CLR 1 at 33. 30 (1992) 176 CLR 1 at 33. McHugh authorizing the detention of an alien went beyond what was reasonably necessary to effect the deportation of that person, the law might be invalid because it infringed the provisions of Ch III"31. Neither of these passages was directed to a case like the present where the detention prevents the unlawful non-citizen from entering the Australian community although deportation is not feasible in the reasonably foreseeable future. Neither passage was directed to a case where indefinite detention is necessary to prevent a person from entering Australia or the Australian community. Nor does the Communist Party Case32, to which Kirby J refers, assist Mr Al-Kateb. In that case, this Court held that the law in question was not supported by s 51(xxxix) ("the incidental power") in conjunction with s 61 ("the executive power") of the Constitution or s 51(vi) ("the defence power") of the Constitution. The Communist Party Case had nothing to do with aliens, and no Justice found that the law infringed Ch III of the Constitution. Latham CJ, who dissented and upheld the validity of the law, expressly held that it did not contravene Ch III of the Constitution33. Nor does it assist Mr Al-Kateb's case to assert that this Court "should be no less defensive of personal liberty in Australia than the courts of the United States34, the United Kingdom35 and the Privy Council for Hong Kong36 have been, all of which have withheld from the Executive a power of unlimited detention"37. None of those cases was concerned with the question whether, by enacting laws similar to ss 189, 196 and 198, the legislature was exercising "the judicial power of the Commonwealth" or for that matter "judicial power". Zadvydas v Davis38, to which Kirby J refers, was not concerned with the exercise of judicial power. In Zadvydas, the Supreme Court of the United States 31 (1992) 176 CLR 1 at 65. 32 Australian Communist Party v The Commonwealth (1951) 83 CLR 1. 33 (1951) 83 CLR 1 at 170-173. 34 Zadvydas v Davis 533 US 678 (2001). 35 R v Governor of Durham Prison; Ex parte Hardial Singh [1984] 1 WLR 704; [1984] 1 All ER 983. 36 Tan Te Lam v Superintendent of Tai A Chau Detention Centre [1997] AC 97. 37 Reasons of Kirby J at [149]. McHugh held that, as a matter of construction, the statute in question did not provide for the indefinite detention of an alien who had entered the country unlawfully. The Supreme Court said that a law "permitting indefinite detention of an alien would raise a serious constitutional problem"39. That was because under the United States Constitution, "the Due Process Clause applies to all 'persons' within the United States, including aliens, whether their presence here is lawful, unlawful, temporary, or permanent"40. Consequently, in accordance with United States doctrine, the Court had to "ascertain whether a construction of the statute is fairly possible by which the question [of constitutionality] may be avoided"41. The Court found that the statute in question could be fairly construed as not requiring indefinite detention of an alien. Although Zadvydas was not concerned with judicial power, it is significant that the Court said: "we assume that [the proceedings to deport] are nonpunitive in purpose and effect"42. R v Governor of Durham Prison; Ex parte Hardial Singh43, to which Kirby J refers, was also concerned with an issue of statutory construction, and not the exercise of judicial power. Woolf J held in that case that the power of detention given by a paragraph in a schedule to the relevant Act was limited to such period of time as was reasonably necessary to carry out the process of deportation. His Lordship also held that the Secretary of State should not exercise the power of detention unless the person involved could be deported within a reasonable time. Tan Te Lam v Superintendent of Tai A Chau Detention Centre44, to which Kirby J refers, also concerned a question of statutory construction. The Privy Council held that, where a statute had given the executive government power to detain persons pending their removal from the country, it was implied, unless the statute provided otherwise, that the power could only be exercised during such period as was reasonably necessary to effect removal. If removal was not possible within a reasonable time, further detention was not authorised. The case was not concerned with a constitutional issue or whether legislation authorising the executive government to detain an alien involved the exercise of judicial power. 39 533 US 678 at 690 (2001). 40 533 US 678 at 693 (2001). 41 533 US 678 at 689 (2001). 42 533 US 678 at 690 (2001). 43 [1984] 1 WLR 704; [1984] 1 All ER 983. McHugh It is not true, as Kirby J asserts, that "indefinite detention at the will of the Executive, and according to its opinions, actions and judgments, is alien to Australia's constitutional arrangements"45. During the First and Second World Wars, the National Security Regulations authorised the detention of persons who, in the opinion of the executive government, were disloyal or a threat to the security of the country. Many persons born in Germany were detained under these Regulations in both wars, while many persons born in Italy were detained under the relevant regulation during the Second World War. However, detention was not confined to those born in the countries with which Australia was at war. As the detention of members of the Australia First Movement demonstrates, foreign birth was not a necessary condition of detention. P R Stephensen, one of the leaders of that Movement, was detained for almost three and a half years46. During the First World War, reg 55(1) of the War Precautions Regulations 1915 (Cth) provided that where the Minister for Defence "has reason to believe that any naturalized person is disaffected or disloyal, he may, by warrant under his hand, order him to be detained in military custody in such place as he thinks fit during the continuance of the present state of war". The validity of that regulation was upheld by this Court in Lloyd v Wallach47. The Court unanimously held that the regulation was validly made under the War Precautions Act 1914 (Cth) which was enacted under the defence power. No member of the Court suggested that the regulation infringed Ch III of the Constitution. During the Second World War, reg 26 of the National Security (General) Regulations 1939 (Cth) provided: "The Minister may if satisfied with respect to any particular person that with a view to prevent that person acting in any manner prejudicial to the public safety or the defence of the Commonwealth it is necessary to do so make an order ... directing that he be detained in such place and under such conditions as the Minister from time to time determines ..." 45 Reasons of Kirby J at [146]. 46 Crockett, Evatt: A Life, (1993) at 121-125. 47 (1915) 20 CLR 299. McHugh This Court unanimously upheld the validity of the regulation in Ex parte Walsh48. Starke J said that the application for habeas corpus was "hopeless"49. In Little v The Commonwealth50, Dixon J held that an order of the Minister under this regulation was not examinable upon any ground other than bad faith. During the greater part of the period when reg 26 was in force, the relevant Minister was Dr H V Evatt, who had been a Justice of this Court and was later to become President of the United Nations General Assembly. According to a speech he gave in Parliament on 19 July 1944, 6174 persons were detained under this regulation at the time when he became the Minister and 1180 persons were still detained under the regulation in July 194451. He does not appear to have thought that, in making orders under reg 26, he was acting in breach of Ch III of the Constitution. Nor am I aware of anybody else suggesting that detention under these Regulations infringed Ch III of the Constitution. The purpose of the detention was not punitive but protective. I see no reason to think that this Court would strike down similar regulations if Australia was again at war in circumstances similar to those of 1914-1918 and 1939-1945. Finally, contrary to the view of Kirby J, courts cannot read the Constitution by reference to the provisions of international law that have become accepted since the Constitution was enacted in 1900. Rules of international law at that date might in some cases throw some light on the meaning of a constitutional provision. Interpretation of the term "aliens" by reference to the jus soli or jus sanguinis is an example. But rules of international law that have come into existence since 1900 are in a different category. The claim that the Constitution should be read consistently with the rules of international law has been decisively rejected by members of this Court on several occasions. As a matter of constitutional doctrine, it must be regarded as heretical. In Polites v The Commonwealth, the Court accepted that, so far as the language of a statute permits, it should be interpreted and applied in conformity with the established rules of international law52. That is a rule of construction of long standing. The rationale for the rule is that the legislature is taken not to 48 [1942] ALR 359. 49 [1942] ALR 359 at 360. 50 (1947) 75 CLR 94. 51 Crockett, Evatt: A Life, (1993) at 126. 52 (1945) 70 CLR 60 at 68-69, 77, 80-81. McHugh have intended to legislate in violation of the rules of international law existing when the legislation was enacted53. Accordingly, the law is construed as containing an implication to that effect. But, as Polites decided, the implication must give way where the words of the statute are inconsistent with the implication. No doubt the rule of construction had some validity when the rules of international law were few and well-known. Under modern conditions, however, this rule of construction is based on a fiction. Gone are the days when the rules of international law were to be found in the writings of a few well- known jurists. Under Art 38 of the Statute of the International Court of Justice54, international law includes: (1) international conventions establishing rules recognised by contesting states, (2) international custom, as evidence of a general practice accepted as law and (3) the general principles of law recognised by civilised nations. International custom may be based on the "diplomatic correspondence, policy statements, press releases, opinions of official legal advisers, official manuals on legal questions ... executive decisions and practices, orders to naval forces etc, comments by governments on drafts produced by the International Law Commission, state legislation, international and national judicial decisions, recitals in treaties and other international instruments, a pattern of treaties in the same form, the practice of international organs, and resolutions relating to legal questions in the United Nations General Assembly."55 Given the widespread nature of the sources of international law under modern conditions, it is impossible to believe that, when the Parliament now legislates, it has in mind or is even aware of all the rules of international law. Legislators intend their enactments to be given effect according to their natural and ordinary meaning. Most of them would be surprised to find that an enactment had a meaning inconsistent with the meaning they thought it had because of a rule of international law which they did not know and could not find without the assistance of a lawyer specialising in international law or, in the case of a treaty, by reference to the proceedings of the Joint Standing Committee on Treaties. In Minister for Immigration and Ethnic Affairs v Teoh, counsel for the Minister told this Court that Australia was "a party to about 900 treaties"56. 53 Garland v British Rail Engineering Ltd [1983] 2 AC 751 at 771; Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 287. 54 Statute of the International Court of Justice, done at San Francisco, 26 June 1945. 55 Brownlie, Principles of Public International Law, 6th ed (2003) at 6. 56 (1995) 183 CLR 273 at 316 (emphasis added). McHugh When one adds to the rules contained in those treaties, the general principles of law recognised by civilised nations and the rules derived from international custom, it becomes obvious that the rationale for the rule that a statute contains an implication that it should be construed to conform with international law bears no relationship to the reality of the modern legislative process. Be that as it may, the rule of construction recognised in Polites was reaffirmed by this Court in Teoh57 and by Gummow and Hayne JJ in Kartinyeri v The Commonwealth58. It is too well established to be repealed now by judicial decision. However, this Court has never accepted that the Constitution contains an implication to the effect that it should be construed to conform with the rules of international law. The rationale for the rule and its operation is inapplicable to a Constitution – which is a source of, not an exercise of, legislative power. The rule, where applicable, operates as a statutory implication. But the legislature is not bound by the implication. It may legislate in disregard of it. If the rule were applicable to a Constitution, it would operate as a restraint on the grants of power conferred. The Parliament would not be able to legislate in disregard of the implication. In Polites, Dixon J, after accepting that the implication applied in "The contention that s 51(vi) of the Constitution should be read as subject to the same implication, in my opinion, ought not to be countenanced. The purpose of Pt V of Ch I of the Constitution is to confer upon an autonomous government plenary legislative power over the assigned subjects. Within the matters placed under its authority, the power of the Parliament was intended to be supreme and to construe it down by reference to the presumption is to apply to the establishment of legislative power a rule for the construction of legislation passed in its exercise. It is nothing to the point that the Constitution derives its force from an Imperial enactment. It is none the less a constitution." In Kartinyeri, Gummow and Hayne JJ cited that passage with approval60. Their Honours went on to point out that in Horta v The Commonwealth61 the "judgment of the whole Court affirmed that no provision of the Constitution 57 (1995) 183 CLR 273 at 287. 58 (1998) 195 CLR 337 at 384 [97]. 59 (1945) 70 CLR 60 at 78. See also at 69 per Latham CJ, 74 per Rich J, 75 per Starke J, 79 per McTiernan J, 82-83 per Williams J. 60 (1998) 195 CLR 337 at 385 [98]. 61 (1994) 181 CLR 183 at 195. McHugh confines the legislative power with respect to 'External affairs' to the enactment of laws which are consistent with, or which relate to treaties or matters which are consistent with, the requirements of international law"62. In Kartinyeri, Gummow and Hayne JJ rejected a submission that in essence "sought to apply a rule for the construction of legislation passed in the exercise of the legislative power to limit the content of the legislative power itself"63. Most of the rules64 now recognised as rules of international law are of recent origin. If Australian courts interpreted the Constitution by reference to the rules of international law now in force, they would be amending the Constitution in disregard of the direction in s 128 of the Constitution. Section 128 declares that the Constitution is to be amended only by legislation that is approved by a majority of the States and "a majority of all the electors voting". Attempts to suggest that a rule of international law is merely a factor that can be taken into account in interpreting the Constitution cannot hide the fact that, if that is done, the meaning of the Constitution is changed whenever that rule changes what would otherwise be the result of the case. The point is so obvious that it hardly needs demonstration. But a simple example will suffice to show the true character of what is done if courts take a post-1900 rule of international law into account. Immediately before the rule was recognised, our Constitution had meanings that did not depend on that rule. Either the rule of international law has effect on one or more of those meanings or it has no effect. If it has an effect, its invocation has altered the meaning of the Constitution overnight. As a result, a court that took the rule into account has amended the Constitution without the authority of the people acting under s 128 of the Constitution. It has inserted a new rule into the Constitution. Take this case. The issues are whether ss 189, 196 and 198 are laws with respect to aliens or are exercises by the the Parliament and not the federal courts of judicial power of the 62 (1998) 195 CLR 337 at 385 [99]. 63 (1998) 195 CLR 337 at 386 [101]. 64 The main – perhaps the only – difference between rules and principles is that principles are expressed at a higher level of generality than rules. In the present context, the difference between rules and principles seems a distinction without a difference. The international law provisions most frequently invoked to interpret statutes and Constitutions are Articles in international Conventions, which are more like rules than principles. Does "rule" or "principle" most accurately describe a provision such as Art 26 of the International Covenant on Civil and Political Rights ("All persons are equal before the law and are entitled without any discrimination to the equal protection of the law ...")? Whether described as a rule – which I prefer – or a principle, the effect of such provisions on statutory or constitutional interpretation is the same. McHugh Commonwealth. If this Court had to take a rule of international law into account in interpreting those powers, the rule would either confirm what was already inherent in the powers or add to or reduce them. If the international rule is already inherent in the power it is irrelevant. If it is not, its invocation alters the constitutional meaning of "aliens" or "judicial power of the Commonwealth" or both. Many constitutional lawyers – probably the great majority of them – now accept that developments inside and outside Australia since 1900 may result in insights concerning the meaning of the Constitution that were not present to earlier generations. Because of those insights, the Constitution may have different meanings from those perceived in earlier times. As Professor Ronald Dworkin has often pointed out, the words of a Constitution consist of more than letters and spaces. They contain propositions. And, because of political, social or economic developments inside and outside Australia, later generations may deduce propositions from the words of the Constitution that earlier generations did not perceive. Windeyer J made that point persuasively in Victoria v The Commonwealth65. But that is a very different process from asserting that the Constitution must be read to conform to or so far as possible with the rules of international law. As I earlier pointed out, reading the Constitution up or down to conform to the rules of international law is to make those rules part of the Constitution, contrary to the direction in s 128 that the Constitution is to be amended only in accordance with the referendum process. The issue in Polites66 shows what would be the effect of reading the Constitution to conform with the rules of international law. It was arguably a rule of international law in 1945 that aliens could not be compelled to serve in the military forces of a foreign state in which they happened to be. Whether or not such a rule existed67, this Court refused to read the constitutional powers with 65 (1971) 122 CLR 353 at 395-397. 66 (1945) 70 CLR 60. 67 See Kartinyeri v The Commonwealth (1998) 195 CLR 337 at 384 (n 199) per Gummow and Hayne JJ: "The accuracy, at the time, of that perception of customary international law has been disputed, at least as regards aliens who were permanent residents of the conscripting state: Shearer, 'The Relationship Between International Law and Domestic Law' in Opeskin and Rothwell (eds), International Law and Australian Federalism (1997) at 48-49, n 60; O'Connell, International Law, 2nd ed (1970), vol 2 at 703-705." McHugh respect to "defence"68 and "aliens"69 as subject to such a rule. If the Court had accepted the argument of the plaintiff in Polites, the international law rule would have become a constitutional rule contrary to s 128 of the Constitution. Failure to see the difference between taking into account political, social and economic developments since 1900 and taking into account the rules of international law is the error in the approach of those who assert that the Constitution must be read in conformity with or in so far as it can be read conformably with the rules of international law. Rules are specific. If they are taken into account as rules, they amend the Constitution. That conclusion cannot be avoided by asserting that they are simply "context" or elucidating factors. Rules are too specific to do no more than provide insights into the meanings of the constitutional provisions. Either the rule is already inherent in the meaning of the provision or taking it into account alters the meaning of the provision. No doubt from time to time the making or existence of (say) a Convention or its consequences may constitute a general political, social or economic development that helps to elucidate the meaning of a constitutional head of power. But that is different from using the rules in that Convention to control the meaning of a constitutional head of power. Suppose the imposition of tariffs is banned under a World Trade Agreement. If that ban were taken into account – whether as context or otherwise – in interpreting the trade and commerce power70, it would add a new rule to the Constitution. It would require reading the power to make laws with respect to trade and commerce as subject to the rule that it did not extend to laws that imposed tariffs. Such an approach, in the words of Dixon J, cannot be "countenanced"71. It is also erroneous to think that, in Lawrence v Texas72, the United States Supreme Court adopted the position that Kirby J advocates. All that Kennedy J (delivering the majority decision) did in Lawrence was to rely on a decision of the European Court of Human Rights to rebut the claim made in the earlier United States case of Bowers v Hardwick that private homosexual acts had "been subject to state intervention throughout the history of Western civilization"73. Kennedy J said that "the decision is at odds with the premise in Bowers that the 68 The Constitution, s 51(vi). 69 The Constitution, s 51(xix). 70 The Constitution, s 51(i). 71 Polites v The Commonwealth (1945) 70 CLR 60 at 78. 73 478 US 186 at 196 (1986). McHugh claim put forward was insubstantial in our Western civilization"74. The Supreme Court did not apply any rule of international law. It used European case law to reject the major premise of Bowers that the Due Process Clause of the US Constitution did not protect private homosexual conduct because such conduct had been condemned "throughout the history of Western civilization". Moreover, reliance on the European decision played only a minor part in the Court's decision. Eminent lawyers who have studied the question firmly believe that the Australian Constitution should contain a Bill of Rights which substantially adopts the rules found in the most important of the international human rights instruments75. It is an enduring – and many would say a just – criticism of Australia that it is now one of the few countries in the Western world that does not have a Bill of Rights. But, desirable as a Bill of Rights may be, it is not to be inserted into our Constitution by judicial decisions drawing on international instruments that are not even part of the law of this country. It would be absurd to suggest that the meaning of a grant of power in s 51 of the Constitution can be elucidated by the enactments of the Parliament. Yet those who propose that the Constitution should be read so as to conform with the rules of international law are forced to argue that rules contained in treaties made by the executive government are relevant in interpreting the Constitution. It is hard to accept, for example, that the meaning of the trade and commerce power can be affected by the Australian government entering into multilateral trade agreements. It is even more difficult to accept that the Constitution's meaning is affected by rules created by the agreements and practices of other countries. If that were the case, judges would have to have a "loose-leaf" copy of the Constitution. If Australia is to have a Bill of Rights, it must be done in the constitutional way – hard though its achievement may be – by persuading the people to amend the Constitution by inserting such a Bill. Conclusion Under the aliens power, the Parliament is entitled to protect the nation against unwanted entrants by detaining them in custody. As long as the detention is for the purpose of deportation or preventing aliens from entering Australia or the Australian community, the justice or wisdom of the course taken by the Parliament is not examinable in this or any other domestic court. It is not for courts, exercising federal jurisdiction, to determine whether the course taken by Parliament is unjust or contrary to basic human rights. The function of the courts in this context is simply to determine whether the law of the Parliament is within 74 539 US 558 at 573 (2003). 75 See, eg, Williams, The Case for an Australian Bill of Rights, (2004). McHugh the powers conferred on it by the Constitution. The doctrine of separation of powers does more than prohibit the Parliament and the Executive from exercising the judicial power of the Commonwealth. It prohibits the Ch III courts from amending the Constitution under the guise of interpretation. Order The appeal should be dismissed. I agree with the orders proposed by GUMMOW J. The first and second respondents are officers of the Department administered by the third respondent, the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister"). On the application of the Attorney-General of the Commonwealth under s 40 of the Judiciary Act 1903 (Cth) ("the Judiciary Act"), this Court ordered the removal of the whole of the cause constituted by the appeal by Mr Al-Kateb then pending in the Federal Court of Australia. It is that appeal pending in the Federal Court which has been heard in this Court and is the subject of these reasons. This Court is not exercising the appellate jurisdiction conferred by s 73 of the Constitution. The jurisdiction is that of the Federal Court conferred by Pt III Div 2 (ss 24-30) of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act"); Div 2 is headed "Appellate and related Jurisdiction". The appeal is brought against a decision of the Federal Court (von Doussa J) delivered on 3 April 2003 and dismissing an application by Mr Al-Kateb brought under s 39B of the Judiciary Act. The principal relief sought on the appeal is a declaration that the appellant is "unlawfully detained" and an order in the nature of habeas corpus directing the Minister to cause the appellant forthwith to be released from immigration detention. The facts There is no dispute between the appellant on one side and the Minister and the Attorney-General on the other respecting the relevant facts. The facts may be stated as follows. The appellant arrived in Australia in mid-December 2000, by vessel, without a passport or Australian visa. He was born in Kuwait on 29 July 1976 and is a Palestinian. He has lived for most of his life in Kuwait, save for a brief period when he resided in Jordan, it would seem illegally. The appellant submitted, and it was not contested, that he is a "stateless person". That term is defined in Art 1 of the Convention relating to the Status of Stateless Persons ("the Stateless Persons Convention")76 as meaning one "who is not considered as a national by any State under the operation of its law"77. Long term residency in Kuwait or birth there did not guarantee to Palestinians citizenship or the right to 76 Done at New York on 28 September 1954, which entered into force for Australia on 13 March 1974: [1974] Australian Treaty Series No 20. 77 cf Australian Citizenship Act 1948 (Cth), s 23D. 78 Takkenberg, The Status of Palestinian Refugees in International Law, (1998) at Statelessness At the time of the adoption of the Constitution, the phenomenon of "double nationality" was well understood79, but that of the "stateless person" achieved significance only in the course of the twentieth century80. As late as 1916, the House of Lords reserved the question whether "this country will recognize a man as having no nationality" so as to guard "against appearing to assent to such a proposition"81. Later developments respecting statelessness are significant for the interpretation of the constitutional term "alien". Part 2 of the Migration Act 1958 (Cth) ("the Act") (ss 13-274) is headed "Control of arrival and presence of non-citizens". This appeal is concerned principally with provisions in Div 7 (ss 188-197) headed "Detention of unlawful non-citizens", and Div 8 (ss 198-199) headed "Removal of unlawful non-citizens". The appellant answers the statutory description in s 14 of "unlawful non-citizen"; he is in the migration zone, is not an Australian citizen, and does not hold a visa. Of s 51(xix), Quick and Garran wrote82: "In English law an alien may be variously defined as a person who owes allegiance to a foreign State, who is born out of the jurisdiction of the Queen, or who is not a British subject." Later experience, and the appearance of the class of stateless persons, has shown that these various definitions are not interchangeable. The appellant's status as a stateless person takes him outside the meaning given to the term "alien" in the joint judgment of six members of the Court in Nolan v Minister for Immigration and Ethnic Affairs83. Their Honours said84: 79 Cockburn, Nationality or the Law Relating to Subjects and Aliens, (1869) at 80 Applicant A v Minister for Immigration and Ethnic Affairs (1997) 190 CLR 225 at 81 Ex parte Weber [1916] 1 AC 421 at 424 per Lord Buckmaster LC. 82 The Annotated Constitution of the Australian Commonwealth, (1901) at 599. 83 (1988) 165 CLR 178. 84 (1988) 165 CLR 178 at 183. "As a matter of etymology, 'alien', from the Latin alienus through old French, means belonging to another person or place. Used as a descriptive word to describe a person's lack of relationship with a country, the word means, as a matter of ordinary language, 'nothing more than a citizen or subject of a foreign state'85." On the other hand, in her dissenting judgment in Nolan86, Gaudron J said that "[f]or most purposes" an alien is to be identified by reference to the absence of that criterion, such as citizenship, which determines membership of the community constituting the body politic of the nation state "from whose perspective the question of alien status is to be determined". That appears to assume a relevant logical universe comprising citizens and aliens, and no others, so that all non-Australian citizens are aliens in the constitutional sense of the term. In many cases, the distinctions, express or implicit, in previous authorities will be immaterial to the result reached. For example, the applicants in Re Minister for Immigration and Multicultural Affairs; Ex parte Te87 and the applicant in Shaw v Minister for Immigration and Multicultural Affairs88 were born outside Australia, with Cambodian or Vietnamese, and British nationality respectively, and to parents who were not Australian citizens. But the appellant here is destitute of any nationality. Does that condition deny him the character of a constitutional "alien"? It is unnecessary to decide that question now, particularly in the absence of full argument. That is because, at all events, and as the respondents submitted, the appellant is within the reach of the immigration power in s 51(xxvii) and laws supported by that power89. The history of the legislation From 1901 to 1994, federal law contained offence provisions respecting unlawful entry and presence in Australia, which was punishable by imprisonment as well as by liability to deportation. The legislation gave rise to various 85 Milne v Huber 17 Fed Cas 403 at 406 (1843) (US). 86 (1988) 165 CLR 178 at 189. 87 (2002) 212 CLR 162. 88 (2003) 78 ALJR 203; 203 ALR 143. 89 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 44-45. questions of construction which reached this Court90. The first of these provisions was made by the Immigration Restriction Act 1901 (Cth) ("the 1901 Act")91. Section 7 thereof stated: "Every prohibited immigrant entering or found within the Commonwealth in contravention or evasion of this Act shall be guilty of an offence against this Act, and shall be liable upon summary conviction to imprisonment for not more than six months, and in addition to or substitution for such imprisonment shall be liable pursuant to any order of the Minister to be deported from the Commonwealth. Provided that the imprisonment shall cease for the purpose of deportation, or if the offender finds two approved sureties each in the sum of Fifty pounds for his leaving the Commonwealth within one month." As enacted in 1958, s 27 of the Act continued this pattern. That provision eventually became s 77 of the Act, but this was repealed by s 17 of the Migration Reform Act 1992 (Cth) ("the 1992 Act"). It has not been replaced92. The legislation has also provided for detention by the executive branch of government and without adjudication of criminal guilt pending deportation and pending determination of status. For example, s 8C of the 1901 Act93 authorised the keeping in custody, "pending deportation and until he is placed on board a vessel for deportation from Australia", of any person ordered by the Minister to be deported. Similar provisions were construed by this Court in Koon Wing Lau v Calwell94. The Court rejected the submission recorded by Latham CJ that they were invalid for permitting "unlimited imprisonment"95. The legislation escaped invalidity because it "[did] not create or purport to create a power to keep a deportee in custody for an unlimited period"96 and, rather, implied a purpose such 90 See Griffin v Wilson (1935) 52 CLR 260; Chu Shao Hung v The Queen (1953) 87 CLR 575. 91 The title of the 1901 Act was changed by s 1 of the Immigration Act 1912 (Cth) to the Immigration Act 1901 (Cth). It continued to have that title until its repeal by s 4 of the Migration Act 1958 (Cth). 92 Section 17 commenced on 1 September 1994. 93 Inserted by s 8 of the Immigration Act 1925 (Cth). 94 (1949) 80 CLR 533. 95 (1949) 80 CLR 533 at 555. 96 (1949) 80 CLR 533 at 556 per Latham CJ. that "unless within a reasonable time [the deportee] is placed on board a vessel he would be entitled to his discharge on habeas"97. These statements are important for the construction of the provisions of the Act relied on to continue the detention of the appellant. In saying in Calwell that in the statute "the words 'pending deportation' imply purpose"98, Dixon J was not reading the statute as imposing legal consequences purely on a legislative or executive opinion as to the attainability of that purpose. Such a construction would have invited an attack on validity of a similar nature to that which shortly after Calwell was to succeed in Australian Communist Party v The Commonwealth99. (That case is authority for the basic proposition that the validity of a law or of an act of the executive branch done under a law cannot depend upon the view of the legislature or executive officer that the conditions requisite for validity have been satisfied.) Rather, Dixon J went on in Calwell to describe the purpose as one to be attained within "a reasonable time", to be assessed, if need be, by a court on an application for habeas corpus100. Consistently with that reasoning, the Court in the present case should be slow to construe the Act as if all that were requisite is an executive opinion as to the continued viability of a purpose of deportation. Since 1994, the present system found in Divs 7 and 8 of Pt 2 of the Act has provided for mandatory detention by the Executive of unlawful non-citizens in the manner with which this appeal is concerned and for the discretionary detention by the Executive of persons the subject of deportation orders. The present system contains no offence provision such as found before 1994 and the appellant, as a result, was not liable to punishment by the exercise by a court of the judicial power of the Commonwealth. The appellant's status under the Act was and remains that of an "unlawful non-citizen". Section 189 of the Act requires the detention of unlawful non-citizens and, after the appellant's arrival in Australia, he was placed in "immigration detention" within the meaning of that term in s 5(1) of the Act. The Act also contains in Div 10 of Pt 2 (ss 207-224) a system imposing liability on detainees, their spouses and, in some cases, their carriers for the costs of their detention and removal. It is an offence to escape from immigration detention (s 197A), but, as explained above, it was not the adjudication of guilt of any 97 (1949) 80 CLR 533 at 581 per Dixon J. See also at 586-587 per Williams J. 98 (1949) 80 CLR 533 at 581. 99 (1951) 83 CLR 1. See also Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 512-513 [102]. 100 (1949) 80 CLR 533 at 581. offence which led to the imposition by the Act upon the appellant of a requirement to suffer that detention. The Australian community In R v Forbes; Ex parte Kwok Kwan Lee, Barwick CJ said101: "It scarce needs saying that a prohibited immigrant may not by any means become a member of the Australian community whilst he is a prohibited immigrant. By the very description he is not a person having any title to remain in the country." It is hardly to be supposed that, in speaking of the denial to prohibited immigrants of acquisition of "membership" of "the Australian community", Barwick CJ was giving support to the notion that the legislative powers with respect to such persons would support a system of segregation by incarceration without trial for any offence and with no limit of time or a limit fixed only by an executive opinion as to the ultimate possibility of their removal from Australia. Rather, the use of the term "Australian community" in such statements reflects the rejection in vigorous terms in Robtelmes v Brenan102 of the submission that the legislative power with respect to aliens was one of exclusion from entry only and did not extend to expulsion after entry103. At issue in Robtelmes was the validity of the Pacific Island Labourers Act 1901 (Cth) and of orders for deportation made by magistrates exercising federal jurisdiction. Nevertheless, it does not gainsay the power of expulsion that the appellant is within the Queen's peace as that notion applies in Australia. Australian domestic law is consistent with the requirement in Art 16.1 of the Stateless Persons Convention that such persons have "free access to the Courts of Law on the territory of all Contracting States". Chu Kheng Lim v Minister for Immigration104 indicates that the appellant has the standing or capacity, among other things, to invoke the intervention of a domestic court of competent the jurisdiction is unlawfully detained by to determine whether he 101 (1971) 124 CLR 168 at 173. See also the remarks of Latham CJ in Koon Wing Lau v Calwell (1949) 80 CLR 533 at 561 and of Mason J in R v MacKellar; Ex parte Ratu (1977) 137 CLR 461 at 478. 102 (1906) 4 CLR (Pt 1) 395 at 404, 415, 419. 103 See (1906) 4 CLR (Pt 1) 395 at 396-398. 104 (1992) 176 CLR 1 at 19-20. See also Abebe v The Commonwealth (1999) 197 CLR 510 at 560 [137]. Commonwealth and that valid statutory provision is required to authorise or enforce his detention in custody. The issue here is not the amenability of the appellant to removal; indeed, he has sought, unsuccessfully, his removal by the Minister. It is the construction of the laws under which his detention may continue. Reference was made by the respondents to the decision, by majority, of the Supreme Court of the United States in Shaughnessy v Mezei105. An appreciation of the issue in Robtelmes assists an understanding of the point on which the United States case turned. The statute applied in Shaughnessy had permitted the removal of the alien Mr Mezei from the Île de France on its arrival in New York and his detention on Ellis Island, but specified that his presence there "shall not be considered a landing", so that he was to be treated "as if stopped at the border"106. This deemed state of affairs was critical, for the majority distinguished between the denial of entry and the expulsion of aliens "who have once passed through our gates, even illegally"; to the latter class of case there applied "traditional standards of fairness encompassed in due process of law"107. Later, in Zadvydas v Davis108, the majority of the Supreme Court, with reference to Shaughnessy, said that there runs throughout immigration law "[t]he distinction between an alien who has effected an entry into the United States and one who has never entered". The Australian legislation in force at the time of Shaughnessy109 also deemed certain prohibited immigrants not to have entered Australia. But the distinction upon which Shaughnessy depended does not apply in the legislation which governs the present case. The appellant's case Undoubtedly, the continuing absence for persons in the position of the appellant of any right or title to remain in Australia complements and gives further effect to the well-established constitutional power to legislate for 106 345 US 206 at 215 (1953). 107 345 US 206 at 212 (1953). 108 533 US 678 at 693 (2001). 109 The 1901 Act, s 13C(3); see also s 36A of the Act considered in Heshmati v Minister for Immigration, Local Government and Ethnic Affairs (1991) 31 FCR exclusion or denial of entry110. But these considerations are not determinative of the issues in this case. In or out of detention the appellant lacks any right or title to remain in Australia. However, the point on which the appellant's case turns is his susceptibility under federal law to continued detention, outside any operation of the criminal law requiring that detention, and where the prospects of removal to another country are so remote that continued detention cannot be for the purpose of removal. The appellant submits that his situation answers that case. He contends that, on the proper construction of the Act indicated by authorities such as Calwell and consistently with the Constitution, his further detention was not authorised by the time of the proceeding before von Doussa J. Those submissions should be accepted. The litigation On 6 January 2001, the appellant lodged an application for a protection visa within the meaning of s 36 of the Act. At the relevant time, a criterion for such a visa was that the applicant for the visa was a non-citizen in Australia to whom Australia has protection obligations under the Refugees Convention111. It should be noted that the definition of the term "refugee" in Art 1 of the Refugees Convention includes one "who, not having a nationality and being outside the country of his former habitual residence, is unable or, owing to such fear, is unwilling to return to it". The reference by the phrase "such fear" is to the "well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion". Indeed, one of the objectives of the Refugees Convention was to deal with the particular difficulties encountered by the stateless refugee112. However, the Preamble to the Stateless Persons Convention makes the point that there are many stateless persons who are not covered by the Refugees Convention. The appellant has been shown to be one of those persons. A delegate of the Minister refused the application for a protection visa and that refusal was upheld by the Refugee Review Tribunal. Proceedings in the Federal Court for administrative review were unsuccessful, culminating in the dismissal of an appeal on 21 May 2002. In those circumstances, s 198(6) of the Act operated to require "[a]n officer [to] remove as soon as reasonably 110 Robtelmes v Brenan (1906) 4 CLR (Pt 1) 395 at 400, 415, 418-419. 111 The Convention relating to the Status of Refugees done at Geneva on 28 July 1951 as amended by the Protocol relating to the Status of Refugees done at New York on 31 January 1967. 112 Applicant A v Minister for Immigration and Ethnic Affairs (1997) 190 CLR 225 at practicable an unlawful non-citizen". The term "officer" is widely defined in s 5(1) so as to include not only officers of the Department and Customs officers, but members of the federal, State and Territory police forces. It should be noted that s 198 first appeared as s 54ZF and was introduced by s 13 of the 1992 Act. The analogous provision considered in Lim (but the validity of which was unchallenged) was s 54P(1). This did not use the word "reasonably" which now appears in s 198(6) and other sub-sections of s 198. Rather, the obligation placed by the previous section upon an officer to remove from Australia was to do so "as soon as practicable". On 19 June 2002, the appellant himself indicated to the Department that he wished to leave Australia and to return to "Kuwait, and if you cannot please send me to Gaza". He later, on 30 August 2002, signed a form addressed to the Minister stating "I wish voluntarily to depart Australia, and ask the Minister to remove me from Australia as soon as reasonably practicable". Section 198(1) of the Act requires removal of such unlawful non-citizens "as soon as reasonably practicable". The second respondent was an officer entrusted with that task. She considered that the appellant might be eligible for the provision of a visa or travel authority to enable his removal from Australia to Egypt, Kuwait or the Palestinian territories and that his repatriation to Syria might be possible. It appears that any return to Gaza, a preferred destination by the appellant, would require the co-operation of the authorities of the State of Israel. Inquiries also were undertaken with the Jordanian authorities but, like approaches to other States, were unsuccessful. Von Doussa J considered that these efforts made by the second respondent were reasonable steps to comply with s 198(1) and that there were no grounds for relief in the nature of mandamus. At the time of the hearing before von Doussa J in March 2003, the second respondent remained unable to identify another country to which the appellant might be removed. The result is that the appellant is a stateless person unable either to obtain residency in a third country or to exercise any "right of return" to live in Gaza. In his reasons delivered on 3 April 2003, von Doussa J expressed his conclusions on this aspect of the matter as follows: "However, the possibility of removal in the future remained, and officers of [the Department] and the Minister were continuing to make enquiries. In this case ... I am not satisfied that [Department] officers, including the second respondent, are not taking all reasonable steps to secure the removal from Australia of the [appellant]. However, I consider the evidence does establish that removal from Australia is not reasonably practicable at the present time as there is no real likelihood or prospect of removal in the reasonably foreseeable future." (emphasis added) The evidence before von Doussa J of the efforts made by officers of the Department to bring about the removal of the appellant from Australia is to be understood against the background of customary international law. It is said that the State of nationality is under a duty towards other States to receive its nationals back onto its territory113. That position does not apply to the appellant. Nor is the Stateless Persons Convention of any immediate assistance to him. Article 31 obliges the Contracting States not to "expel a stateless person lawfully in their territory save on grounds of national security or public order" (emphasis added). It should be added that the appellant is presently not in immigration detention. By consent order of the Federal Court (Mansfield J) made on 17 April 2003114, and subject to further order and pending the hearing of this appeal, the appellant was released from detention forthwith. Various conditions were attached to that order and these were variable by agreement between the solicitors for the parties. By such an arrangement, which includes reporting conditions, the appellant moved to live in Sydney. Thus, there is no present occasion for the making of an order in the nature of habeas corpus. The substance of the relief which the appellant seeks appears to be a final injunctive order without the conditions attached to the interlocutory order of Mansfield J, or declaratory relief to similar effect. The key to the resolution of the appellant's case lies in the construction of ss 189, 196 and 198 of the Act. That construction should allow for what was said in Calwell concerning the duration of purposive powers such as those involved here. It also should allow for what was decided in Lim. To that I now turn. The decision in Lim Considerable attention was given in argument to Lim and the reasoning which supported the outcome in that case. In looking at that reasoning, it should be kept in mind that the Court construed the removal provisions of the Act upon a particular footing as to the conduct of international relations. The case concerned Cambodian nationals, not stateless persons. It appears to have been assumed in Lim, as it had been in Calwell, that, once the status of an illegal 113 Weis, Nationality and Statelessness in International Law, 2nd ed (1979) at 46. 114 After the decision of the Full Federal Court in Minister for Immigration and Multicultural and Indigenous Affairs v Al Masri (2003) 126 FCR 54, delivered on 15 April 2003. immigrant was established, then expulsion or deportation would be a practicable course and that the country of nationality could be expected to discharge its international responsibilities. The evidence in this case demonstrates that, at least as far as stateless persons are concerned, such assumptions cannot be made. That strand in the reasoning in Lim, which assumed that the detainees, by requesting their removal, had it in their own power to bring their detention to an end, can play no part in this case. For the purposes of the present case, it is sufficient to treat Lim as authority for the following: (i) valid statutory provision is required to authorise and enforce the custodial detention by the State of aliens115; (ii) such an exercise of legislative power is subject to such operation as Ch III has upon the subject- matter; (iii) but legislatively conferred authority to detain aliens in custody for the purposes of receiving, investigating and determining applications for entry permits and, upon rejection and exhaustion of review processes, to detain aliens pending their removal from Australia, is not essentially and exclusively judicial in character; (iv) when conferred by statute law upon the Executive rather than a court the authority identified in (iii) "takes its character" from the legislative powers to exclude, admit and deport of which it is an incident116; and (v) otherwise a law to authorise and enforce the detention of aliens in custody will be invalid; this may be because the detention for which it provides is but an incident of the essential judicial function of adjudging and punishing criminal guilt117 or, for the reasons developed by Gaudron J in Kruger v The Commonwealth118, the law is not on a topic with respect to which s 51 of the Constitution confers legislative power. The reasoning supporting the two bases outlined in (v) may be reserved for consideration later in these reasons. The immediate issues are of construction of the Act against the background of the constitutional propositions drawn from Lim and stated above in (i)-(iv). The references in those propositions to "aliens" should be understood as also applying to stateless persons in the position of the appellant. The contrary has not been suggested. The legislative text Section 189(1) provides: 115 (1992) 176 CLR 1 at 19 per Brennan, Deane and Dawson JJ. 116 (1992) 176 CLR 1 at 32 per Brennan, Deane and Dawson JJ. 117 (1992) 176 CLR 1 at 27 per Brennan, Deane and Dawson JJ. 118 (1997) 190 CLR 1 at 109-111. "If an officer knows or reasonably suspects that a person in the migration zone (other than an excised offshore place) is an unlawful non-citizen, the officer must detain the person." However, that detention is not without limit of time or with an absence of purpose. These are supplied by s 196. "(1) An unlawful non-citizen detained under section 189 must be kept in immigration detention until he or she is: removed from Australia under section 198 or 199; or deported under section 200; or granted a visa. To avoid doubt, subsection (1) does not prevent the release from immigration detention of a citizen or a lawful non-citizen. To avoid doubt, subsection (1) prevents the release, even by a court, of an unlawful non-citizen from detention (otherwise than for removal or deportation) unless the non-citizen has been granted a visa." Section 196(3), consistently with the reasoning in Lim of Mason CJ119, with whom Toohey J agreed120, and of McHugh J121, should be construed as applying only to those who are held in lawful detention pursuant to the Act. Habeas corpus will secure the release from detention of a person no longer in such lawful detention. Reference should also be made to the balance of s 196, being sub-ss (4)-(7): "(4) Subject to paragraphs (1)(a), (b) and (c), if the person is detained as a result of the cancellation of his or her visa under section 501, the detention is to continue unless a court finally determines that the detention is unlawful, or that the person detained is not an unlawful non-citizen. 119 (1992) 176 CLR 1 at 13-14. 120 (1992) 176 CLR 1 at 50-51. 121 (1992) 176 CLR 1 at 67-69. (4A) Subject to paragraphs (1)(a), (b) and (c), if the person is detained pending his or her deportation under section 200, the detention is to continue unless a court finally determines that the detention is unlawful. To avoid doubt, subsection (4) or (4A) applies: (a) whether or not there is a real likelihood of the person detained being removed from Australia under section 198 or 199, or deported under section 200, in the reasonably foreseeable future; and (b) whether or not a visa decision relating to the person detained is, or may be, unlawful. (5A) Subsections (4) and (4A) do not affect by implication the continuation of the detention of a person to whom those subsections do not apply. This section has effect despite any other law. In this section: visa decision means a decision relating to a visa (including a decision not to grant the visa, to cancel the visa or not to reinstate the visa)." Sub-sections (4)-(7) of s 196 were added by the Migration Amendment (Duration of Detention) Act 2003 (Cth). Those amendments commenced on 24 September 2003, that is to say, before the hearing of this appeal. Given the nature of the appeal provided by the Federal Court Act, which differs from that provided by s 73 of the Constitution122, the amendments, if otherwise applicable in their terms, would require consideration. However, the appellant is neither detained as a result of a visa cancellation under s 501, nor is he being detained pending deportation under s 200. For this reason, sub-ss (4) and (4A) of s 196 do not apply to the appellant, and the qualifications in sub-ss (5) and (5A) also do not apply. As a result, this case does not require the Court to consider the construction or constitutional validity of those sub-sections. In particular, it should be noted that the Court need not decide whether a provision providing for continued detention where there is no "real likelihood of the person detained being removed from Australia under section 198 or 199, or deported under section 200, in the reasonably foreseeable future" would be valid. 122 See Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73 at 109; CDJ v VAJ (1998) 197 CLR 172 at 201-202 [111]; Western Australia v Ward (2002) 213 CLR 1 at 87 [70]. Two sub-sections of s 198 are material, sub-ss (1) and (6). These state: "(1) An officer must remove as soon as reasonably practicable an unlawful non-citizen who asks the Minister, in writing, to be so removed. (6) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: the non-citizen is a detainee; and the non-citizen made a valid application for a substantive visa that can be granted when the applicant is in the migration zone; and one of the following applies: the grant of the visa has been refused and the application has been finally determined; (iii) the visa cannot be granted; and the non-citizen has not made another valid application for a substantive visa that can be granted when the applicant is in the migration zone." In considering these provisions, it is important to eschew, if a construction doing so is reasonably open, a reading of the legislation which recognises a power to keep a detainee in custody for an unlimited time. That reluctance is evident in the construction given the legislation in Calwell. Rather, temporal limits are linked to the purposive nature of the detention requirement in the legislation. Conclusions as to legislative construction This appeal is to be determined upon the construction of the legislation. In the somewhat similar situation that was presented in Zadvydas123 the Supreme Court of the United States also took that course. 123 533 US 678 at 689 (2001). It will be apparent that, in the circumstances of the present case, the legislation placed upon an officer two obligations of removal of the appellant. The first (s 198(6)) arose upon exhaustion of the steps leading to the refusal of the protection visa application and the failure on 21 May 2002 of the Federal Court litigation respecting that refusal. Had the visa application succeeded, then par (c) of s 196(1) would have discharged the requirement of further detention of the appellant. The second obligation of removal arose later, from the written request for his removal made by the appellant in his letter of 30 August 2002 to the Minister. The requirement imposed upon the appellant by s 196 was to suffer immigration detention for the purposes of facilitating discharge of the various obligations placed upon an officer to remove the appellant from Australia under s 198. Section 196 speaks also of removal under s 199 and deportation under s 200. However, the terms of s 199 and s 200 are not applicable to the appellant124. There are several temporal elements in the provisions under consideration. There is the requirement in s 196(1) to keep the appellant in detention "until he or she is ... removed from Australia under section 198" (emphasis added). There is also an element of process or outcome which is attainable or achieved under s 198. What then is the significance for a removal under s 198 of a failure to do so "as soon as reasonably practicable"? (emphasis added) Here, too, there is a temporal element, supplied by the phrase "as soon as". The term "practicable" identifies that which is able to be put into practice and which can be effected or accomplished. The qualification "reasonably" introduces an assessment or judgment of a period which is appropriate or suitable to the purpose of the The term "purpose" identifies "the object for the legislative scheme. advancement or attainment of which [the] law was enacted"125. This involves the detention of the appellant to facilitate his availability to removal from Australia but not with such delay that his detention has the appearance of being for an unlimited time. If the stage has been reached that the appellant cannot be removed from Australia and as a matter of reasonable practicability is unlikely to be removed, there is a significant constraint for the continued operation of s 198. In such a case s 198 no longer retains a present purpose of facilitating removal from 124 Section 199 is concerned with the dependants of removed non-citizens and s 200 with the deportation of certain non-citizens who have been convicted of crimes and with deportation on security grounds. 125 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR Australia which is reasonably in prospect and to that extent the operation of s 198 is spent. If that be the situation respecting s 198, then the temporal imperative imposed by the word "until" in s 196(1) loses a necessary assumption for its continued operation. That assumption is that s 198 still operates to provide for removal under that section. In the present case, the findings of von Doussa J, which have been set out earlier in these reasons, that there was no real likelihood or prospect of removal of the appellant in the reasonably foreseeable future, despite the taking to date by the officers of the Department of reasonable steps to secure the reception of the appellant by another country, are of critical importance. They indicate that his Honour should have gone on to hold that, on their proper construction, ss 198 and 196 no longer mandated the continuing detention of the appellant. The appellant remains liable to removal (in the absence of his consent to that course). Nor, it may be, does the appellant escape further liability to renewed detention to facilitate that removal if the prospects of removal arrangements revive as a matter of real likelihood. It also should be emphasised that nothing in these reasons qualifies in any way the requirement that the appellant be detained whilst his protection visa application was pending and review proceedings had not been pursued to finality. The point of present importance for the appellant is that the continued detention of this stateless person is not mandated by the hope of the Minister, triumphing over present experience, that at some future time some other State may be prepared to receive the appellant. The scope of legislative power The question appears to have been raised in several of the other judgments in this case whether administrative detention of aliens and their segregation thereby from the Australian community for a purpose unconnected with the regulation of their entry, investigation, admission or deportation might be authorised by a law which was compatible with Ch III of the Constitution. The position also appears to be adopted that legislation may validly authorise the indefinite detention of an unlawful non-citizen, even where that person has requested removal under a provision such as s 198(1) of the Act, provided that, in the view of the executive government, which may be contrary to the fact, such removal remains a matter of reasonable practicability. Lest silence be taken as any assent to these propositions, I should state my disagreement with them. To do so, it is necessary to return to what earlier in these reasons was marked as proposition (v) to be derived from Lim126. 126 (1992) 176 CLR 1. A majority of the Court in Lim accepted the proposition that the power of the Parliament to authorise, and that of the Executive to implement, the detention of aliens is limited by reference to the purpose of that detention. In their joint judgment, Brennan, Deane and Dawson JJ held that laws authorising the administrative detention of aliens will only be valid127: "if the detention which they require and authorize is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered". Their Honours went on to explain that, were laws authorising immigration detention not so limited, the authority of the Executive to detain could not properly be characterised as being an incident of the power to exclude, admit and deport128. In these circumstances, the detention would properly be characterised as punitive and would thereby offend against the principle that the judicial power of the Commonwealth can only be vested in Ch III courts129. In a separate judgment in Lim, McHugh J expressed a similar view, and one which likewise focused on the purpose of detention as the criterion upon which the constitutional validity of the detention was to be assessed. His Honour said130: "If a law authorizing the detention of an alien went beyond what was reasonably necessary to effect the deportation of that person, the law might be invalid because it infringed the provisions of Ch III of the Constitution. Similarly, if a law, authorizing the detention of an alien while that person's application for entry was being considered, went beyond what was necessary to effect that purpose, it might be invalid because it infringed Ch III." 127 (1992) 176 CLR 1 at 33. 128 (1992) 176 CLR 1 at 33. 129 (1992) 176 CLR 1 at 33. 130 (1992) 176 CLR 1 at 65-66. 131 (1992) 176 CLR 1 at 71. "Although detention under a law of the Parliament is ordinarily characterized as punitive in character, it cannot be so characterized if the purpose of the imprisonment is to achieve some legitimate non-punitive object. … But if imprisonment goes beyond what is reasonably necessary to achieve the non-punitive object, it will be regarded as punitive in character." Gaudron J analysed the issue not in terms of the limitations on legislative power imposed by Ch III, but rather as an issue of characterisation and the scope of that legislative power. In her Honour's view, which was further developed in Kruger132, a law that was not appropriate and adapted to regulating the entry of aliens or facilitating their departure could not be characterised as a valid law with respect to naturalisation and aliens under s 51(xix)133. Although it proceeds on a different basis, the result of Gaudron J's analysis is consistent with the view expressed by Brennan, Deane, Dawson and McHugh JJ that the power of the Parliament to authorise the administrative detention of aliens is not at large and that the power does not extend to authorise detention for any purpose selected by the Parliament. There may be situations in which a law authorising the detention of aliens is "so insubstantial, tenuous or distant" in its connection with aliens that "it ought not to be regarded as enacted with respect to the specified matter falling within the Commonwealth power"134. However, between the reasons dictating invalidity in Lim, those advanced by Brennan, Deane, Dawson and McHugh JJ are to be preferred. Consistently with McHugh J's analysis in Lim135, it could not seriously be doubted that a law providing for the administrative detention of bankrupts in order to protect the community would be a law with respect to bankruptcy and insolvency (s 51(xvii)), or that a law providing for the involuntary detention of all persons within their homes on census night would be a law with respect to census and statistics (s 51(xi)). If such laws lack validity, it is not by reason of any limitation in the text of pars (xvii) and (xi) but by the limitation in the opening words of s 51, "subject to this Constitution", which attract any limitation required by Ch III. 132 (1997) 190 CLR 1 at 109-111. 133 (1992) 176 CLR 1 at 57. 134 The words are those of Dixon J in Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 79. 135 (1992) 176 CLR 1 at 64. In considering any limitation required by Ch III, it is not to the point that if no such limitation applies persons may be deprived of their liberty and detained without commission of and conviction for any offence, so that to require of the Parliament that it attain its objective of detention by means of the criminal law is to allow form to triumph over substance. That which the Constitution may require is an expression of supreme authority in the Australian system of government. The nature of the Ch III limitation The respective submissions in the present case fixed upon the question whether the detention authorised by the Act was punitive or non-punitive in character. This reflects the general discussion in Lim and Kruger of the Commonwealth's power to impose administrative detention. However, there is often no clear line between purely punitive and purely non-punitive detention. So much is clear from this Court's decision in Chu Shao Hung v The Queen136. That case concerned s 5(6) of the 1901 Act as it then stood, which provided that any person deemed to be a prohibited migrant by virtue of s 5 was guilty of a criminal offence. The last sentence of the sub-section read: "Penalty: Imprisonment for six months, and, in addition to or substitution for such imprisonment, deportation from the Commonwealth pursuant to an order made in that behalf by the Minister." Kitto J, with whom Fullagar J agreed137, noted that, although an offence under s 5 was criminal in nature138, "there may be no purpose to be served by the imprisonment except that of keeping the 'offender' available for immediate deportation in the event of the Minister's deciding upon that course, and it is quite right, therefore, to say that the provision for imprisonment is ancillary to the provision with respect to deportation". Accepting this, it is clear that imprisonment under s 5(6) had both punitive and non-punitive aspects. The imprisonment provided for by the sub-section was imposed as a "penalty"; in that sense, it was penal or punitive in character. Yet, 136 (1953) 87 CLR 575. 137 (1953) 87 CLR 575 at 585. 138 (1953) 87 CLR 575 at 589; see also Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 96; O'Keefe v Calwell (1949) 77 CLR 261 at 278; Koon Wing Lau v Calwell (1949) 80 CLR 533 at 555. as Kitto J noted, the purpose of the imprisonment also included a non-punitive element; namely, the facilitation of deportation. This coincidence of punitive and non-punitive purposes is not uncommon. In Veen v The Queen [No 2]139, this Court recognised that among the purposes which inform a criminal sentence are not only the punitive purposes of deterrence, retribution and reform, but also what may be seen as the non-punitive purpose of protection of society. Once it is accepted that many forms of detention punitive/non-punitive distinction cannot be the basis upon which the Ch III limitations respecting administrative detention are enlivened. some non-punitive purpose, follows involve that Accordingly, the focusing of attention on whether detention is "penal or punitive in character" is apt to mislead. As Blackstone noted, in a passage quoted by Brennan, Deane and Dawson JJ in Lim140, "[t]he confinement of the person, in any wise, is an imprisonment" and one which, subject to certain exceptions, is usually only permissible if consequent upon some form of judicial process. It is primarily with the deprivation of liberty that the law is concerned, not with whether that deprivation is for a punitive purpose. The point is encapsulated in the statement in Hamdi v Rumsfeld by Scalia J (with the concurrence of Stevens J), made with reference to Blackstone and Alexander Hamilton141, that142: "The very core of liberty secured by our Anglo-Saxon system of separated powers has been freedom from indefinite imprisonment at the will of the Executive." In Witham v Holloway, Brennan, Deane, Toohey and Gaudron JJ observed143: "[N]othing is achieved by describing some proceedings as 'punitive' and others as 'remedial or coercive'. Punishment is punishment, whether it is imposed in vindication or for remedial or coercive purposes. And there 139 (1988) 164 CLR 465 at 476. 140 Commentaries, 17th ed (1830), Bk 1, pars 136-137 cited in Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 28. 141 The Federalist, No 84, reproduced in Wright (ed), The Federalist, (1996) at 533. 142 72 USLW 4607 at 4621 (2004). 143 (1995) 183 CLR 525 at 534. can be no doubt that imprisonment and the imposition of fines, the usual sanctions for contempt, constitute punishment." It is convenient here to return to the joint judgment in Lim. Having established that the involuntary detention of a citizen can generally only exist as an incident of the exclusively judicial power of adjudging and punishing criminal guilt, Brennan, Deane and Dawson JJ noted that the protection afforded by Ch III to aliens was not so far reaching144. The principal reason for this is that, absent some authority conferred by statute, aliens have no right to enter or reside in Australia145. The aliens power (s 51(xix)) and the immigration power (s 51(xxvii)) empower the Parliament to establish the conditions upon which aliens enter, reside in and leave Australia146. It has long been recognised that this includes the power to deport aliens on such terms as the legislature thinks fit147. As a consequence of this, the Parliament has the power to authorise the Executive to detain aliens for the purposes of "deportation or expulsion", and as an incident to the executive powers to "receive, investigate and determine an application by that alien for an entry permit"148. However, the purposes are not at large. The continued viability of the purpose of deportation or expulsion cannot be treated by the legislature as a matter purely for the opinion of the executive government. The reason is that it cannot be for the executive government to determine the placing from time to time of that boundary line which marks off a category of deprivation of liberty from the reach of Ch III. The location of that boundary line itself is a question arising under the Constitution or involving its interpretation, hence the present 144 (1992) 176 CLR 1 at 27, 29. 145 Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 81-82. 146 Robtelmes v Brenan (1906) 4 CLR (Pt 1) 395 at 415; R v Macfarlane; Ex parte O'Flanagan and O'Kelly (1923) 32 CLR 518 at 533; Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 81, 83, 137; O'Keefe v Calwell (1949) 77 CLR 261 at 277-278, 288; Koon Wing Lau v Calwell (1949) 80 CLR 533 at 555-556, 147 Robtelmes v Brenan (1906) 4 CLR (Pt 1) 395 at 403, 415, 422; Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 117, 132-133; Koon Wing Lau v Calwell (1949) 80 CLR 533 at 555-556, 558-559; Pochi v Macphee (1982) 151 CLR 101 at 148 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 32; see also Koon Wing Lau v Calwell (1949) 80 CLR 533; Chu Shao Hung v The Queen (1953) 87 CLR 575. significance of the Communist Party Case149. Nor can there be sustained laws for the segregation by incarceration of aliens without their commission of any offence requiring adjudication, and for a purpose unconnected with the entry, investigation, admission or deportation of aliens. To that latter proposition there should be entered the caveat expressed by Brennan, Deane and Dawson JJ in Lim as follows150: "It is unnecessary to consider whether the defence power in times of war will support an executive power to make detention orders such as that considered in Little v The Commonwealth151." Orders The appeal should be allowed with costs and the orders of von Doussa J set aside. The interlocutory regime established by the consent order of Mansfield J depended upon the outcome of the appeal and will be spent. As it now stands, the Act itself does not authorise the imposition upon the appellant of restraints, whether by reporting arrangements or otherwise, upon his freedom of movement and action whilst he is not detained under the legislation. However, with respect to the exercise of jurisdiction by the Federal Court in every "matter" before it, s 22 of the Federal Court Act enjoins the Court to grant the appropriate remedies "either absolutely or on such terms and conditions as the Court thinks just". This provision is in the well-known Judicature form and does not operate at large152. However, I agree that the section supports orders of the type described by the Chief Justice in his reasons in this case. I agree also with the observations in the penultimate paragraph of those reasons. In place of the orders made by von Doussa J, it should be declared that the appellant presently is not liable to detention under the provisions of Pt 2, Div 7 of the Migration Act 1958 (Cth). In addition, (a) there should be liberty to any party to apply to a judge of the Federal Court on two days notice for any further or 149 See, most recently, Attorney-General (WA) v Marquet (2003) 78 ALJR 105 at 116 [66]; 202 ALR 233 at 248. 150 (1992) 176 CLR 1 at 28, fn 66. See also Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 194-195, 227-228, 239, 258-259, 261, 282. 151 (1947) 75 CLR 94. 152 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 231 [59], 239-240 [86]-[88]; see also Reid v Howard (1995) 184 CLR other relief (including injunctive relief153) as may be appropriate to give effect to the reasons of this Court and (b) the respondents should pay the costs of the appellant of the application determined by von Doussa J. 153 See the judgment of Isaacs J in R v Macfarlane; Ex parte O'Flanagan and O'Kelly (1923) 32 CLR 518 at 537-551. Kirby 144 KIRBY J. I agree, for the reasons given by Gummow J154, that this case, referred into the Court under the Judiciary Act 1903 (Cth)155, is to be decided primarily on the basis of the construction of the applicable legislation. Relevantly, this is the Migration Act 1958 (Cth) ("the Act"), ss 196 and 198. Most of the larger questions of law raised in argument, including possible constitutional questions concerning the status of stateless persons as "aliens" within s 51(xix) of the Constitution and the operation of Ch III, do not need to be decided. However, of necessity, in giving meaning to the Act, certain constitutional fundamentals must be kept in mind. Construing the Act to accord with basic rights On the uncontested facts of this case, Mr Ahmed Ali Al-Kateb (the appellant) is a stateless person. By definition, he therefore cannot be removed from Australia to a country of nationality. Despite the very long interval involved in this litigation, no other country has been found by Australia willing to accept him. As a matter of reasonable practicality, therefore, it is proper to infer that he will be unlikely to be removed in the foreseeable future. In these circumstances, I agree in the reasons of Gummow J156 that ss 196 and 198 of the Act do not apply, in terms, to the appellant's case as it now stands. It follows that these sections do not sustain his continuing detention157. As Gummow J points out158, the law-making power with respect to aliens, upon which McHugh J relies for his contrary opinion159, is granted to the Federal Parliament subject to the Constitution160. That includes, relevantly, subject to Ch III of the Constitution. Indefinite detention at the will of the Executive, and 154 Reasons of Gummow J at [118]. 155 s 40. See reasons of Gummow J at [76]-[77]. 156 Reasons of Gummow J at [122]-[123]. 157 See Zadvydas v Davis 533 US 678 at 699 (2001), where Breyer J, for the Court, cites 1 Coke Institutes 70b for the Latin maxim cessante ratione legis cessat ipse lex ("the rationale of a legal rule no longer being applicable, that rule itself no longer applies"). See also R v Governor of Durham Prison; Ex parte Hardial Singh [1984] 1 WLR 704 at 706; [1984] 1 All ER 983 at 985; Tan Te Lam v Superintendent of Tai A Chau Detention Centre [1997] AC 97 at 111. 158 Reasons of Gummow J at [110]. 159 Reasons of McHugh J at [42]-[44]. 160 Constitution, s 51 (opening words). Kirby according to its opinions, actions and judgments, is alien to Australia's constitutional arrangements. This Court should be no less vigilant in defending those arrangements – and their consequences for the meaning of legislation and the ambit of the judicial power – than the United States Supreme Court has lately been in responding to similar Executive assertions in that country161. The constitutional norms are not the same in each country. We have no equivalent to the Fifth Amendment in our Constitution. The United States Constitution contains no express subjection of the legislative power to Art III. Its notions of the judicial power have developed somewhat differently. But the result of each Constitution is similar in this respect. I dissent from the majority view in this case. Potentially, that view has grave implications for the liberty of the individual in this country which this Court should not endorse. "Tragic"162 outcomes are best repaired before they become a settled rule of the Constitution. As McHugh J observed in recent extracurial remarks163: "[I]t is difficult to believe that Australia would have been as politically free a country as it is today if the High Court had upheld the validity of the legislation challenged in the Communist Party Case164. If that legislation had survived, its legacy must have influenced the way that we give effect to political rights and freedoms." We should be no less vigilant than our predecessors were. As they did in the Communist Party Case165, we also should reject Executive assertions of self- defining and self-fulfilling powers. We should deny such interpretations to 161 Hamdi v Rumsfeld 72 USLW 4607 (2004). See reasons of Gummow J at [137]. See also Rasul v Bush 72 USLW 4596 (2004). 162 Reasons of McHugh J at [31]. See also Minister for Immigration and Multicultural and Indigenous Affairs v Al Khafaji [2004] HCA 38 at [4] per McHugh J. 163 McHugh, "The Strengths of the Weakest Arm", paper delivered at the Australian Bar Association Conference, Florence, 2 July 2004. 164 Australian Communist Party v The Commonwealth ("the Communist Party Case") (1951) 83 CLR 1. 165 (1951) 83 CLR 1 at 193 per Dixon J, 205 per McTiernan J, 222 per Williams J, 263 per Fullagar J. See Attorney-General (WA) v Marquet (2003) 78 ALJR 105 at 116 [66]; 202 ALR 233 at 248. Kirby federal law, including the Act. Unlike Callinan J166, I would not have this Court surrender the power of unlimited executive detention to a Minister's "intention" any more than to an open-ended interpretation of the Parliament's command that removal from Australia be "as soon as reasonably practicable". This Court should be no less defensive of personal liberty in Australia than the courts of the United States167, the United Kingdom168 and the Privy Council for Hong Kong169 have been, all of which have withheld from the Executive a power of unlimited detention. further supported, Gummow J's conclusion in my view, by considerations of international law and the common law presumption in favour of personal liberty. In my opinion, the Constitution and the Act are to be read in the light of these abiding values. The conclusion of Gummow J is one defensive of individual liberty. It is also in conformity with the obligations binding upon Australia under international law170. The common law has a strong presumption in favour of liberty, and against indefinite detention171. That presumption informs the way provisions of an Australian statute, such as ss 196 and 198 of the Act, are to be construed by an Australian court. It also informs this Court's approach to elucidating the meaning of the Constitution necessary to support the validity of such provisions172. 166 Reasons of Callinan J at [298]-[299]. 167 See Zadvydas 533 US 678 (2001). 168 See Hardial Singh [1984] 1 WLR 704; [1984] 1 All ER 983. 169 See Tan Te Lam [1997] AC 97. 170 International Covenant on Civil and Political Rights, done at New York on 19 December 1966, [1980] Australian Treaty Series No 23, Arts 7, 9, 10; cf reasons of Callinan J at [297]-[298]. See also Convention relating to the Status of Stateless Persons, done at New York on 28 September 1954, [1974] Australian Treaty Series No 20, Art 31; reasons of Gummow J at [79], [94], [99]. See further: Universal Declaration of Human Rights, General Assembly Resolution 217(III)(A) of 10 December 1948, Art 9; Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment, done at New York on 10 December 1984, [1989] Australian Treaty Series No 21. 171 See, for example, Whittaker v The King (1928) 41 CLR 230 at 248; Trobridge v Hardy (1955) 94 CLR 147 at 152; Watson v Marshall and Cade (1971) 124 CLR 621 at 632; Williams v The Queen (1986) 161 CLR 278 at 292; Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 532; McGarry v The Queen (2001) 207 CLR 121 at 172 cf Lawrence v Texas 539 US 558 at 562, 567 (2003) per Kennedy J. Kirby I agree with Gummow J173 that this conclusion, of itself, does not cast doubt on the lawfulness of the appellant's earlier detention while his application for a protection visa was viable and was being determined according to law. But it does entitle the appellant to relief in these proceedings at the stage that they have now reached. Construing Australian law to accord with international law Response to the criticism: I cannot agree with much of what McHugh J has written in his reasons174, including that part responding to the foregoing reasons of my own. There will be other occasions where I will have written a more substantial exposition of the contested issues than in this case and where it will therefore be more appropriate to enter debate over such matters. However, it is necessary to respond to McHugh J's specific criticisms. Otherwise, it might be thought that they are unanswerable; and that is far from the case. Detention under the Constitution: The express subjection of the legislative power to the judicial power in the Australian Constitution is not a mere formality. The existence and predominance of the judicial power necessarily implies constitutional limitations on the use of the heads of legislative power in Ch I (or the powers of the Executive under Ch II) of the Constitution in providing for unlimited detention without the authority of the judiciary. This is because such a power of detention can turn into punishment in a comparatively short time. And punishment, under the Constitution, is the responsibility of the judiciary; not of the other branches of government175. In another extracurial paper, with which I respectfully agree, McHugh J has pointed to the implications that may exist in Ch III in order that the judiciary, as there provided, should be effective176. Many of these implications remain to be elaborated. His Honour suggested that there would be a "[g]radual acceptance that Ch III protects due process rights"177. In my opinion, impeccable and 173 Reasons of Gummow J at [124]. 174 Reasons of McHugh J at [49]-[73]. 175 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 33. 176 McHugh, "Does Chapter III of the Constitution protect substantive as well as procedural rights?", (2001) 21 Australian Bar Review 235. See Muir v The Queen (2004) 78 ALJR 780; 206 ALR 189. Contrast Milat v The Queen (2004) 78 ALJR 672 at 676 [26]; 205 ALR 338 at 343. 177 McHugh, "Does Chapter III of the Constitution protect substantive as well as procedural rights?", (2001) 21 Australian Bar Review 235 at 238. Kirby persuasive views such as this should be given effect within the Court in legal and constitutional exposition. They should not be confined to papers for the academy and the profession. If the opinion is sound, it applies to judicial decisions, unless binding authority coerces a judge to a different conclusion. The Communist Party Case: Contrary to the suggestion of McHugh J178, the Communist Party Case179 is of substantial assistance to Mr Al-Kateb. This is so for the reasons that Gummow J has identified180. It is inconsistent with a basic proposition of Australian constitutional doctrine, at least since 1951, that the validity of a law or of an act of the Executive should depend on the conclusive assertion or opinion of the Parliament (eg expressed in recitals to an Act181) or the assertion or opinion of an officer of the Executive (eg that the preconditions for the exercise of power have been satisfied). This is why the Communist Party Case is such an important statement of the rule of law as it operates in Australia182. It remains for the judiciary in each contested case to interpret the applicable law. As in the Communist Party Case, this requirement has proved an important, even vital, protection for individual liberty, as McHugh J has himself acknowledged183. Foreign decisions and analogies: Self-evidently, the overseas decisions to which I have referred were not concerned with an elaboration of the language or structure of the Australian Constitution or the meaning of an Australian statute, such as the Act, ss 196 and 198184. How could it be otherwise? But this does not render the cited authority irrelevant to the performance of this Court's duty in the present case. The three cases that I have mentioned185 illustrate singly, and even more forcefully in combination, the resistance of the judges of the common law, since 178 Reasons of McHugh J at [49]-[50]. 179 (1951) 83 CLR 1. 180 Reasons of Gummow J at [109]-[111], [127]-[134]. 181 Communist Party Case (1951) 83 CLR 1 at 193, 206, 222, 263. 182 Communist Party Case (1951) 83 CLR 1 at 175 per Dixon J. 183 See McHugh, "The Strengths of the Weakest Arm", paper delivered at the Australian Bar Association Conference, Florence, 2 July 2004 (extracted above at 184 See reasons of McHugh J at [51]-[54]. 185 Above at [149]. Kirby early times and until the present age, to the notion of unlimited executive power to deprive individuals of liberty. In another important and recent case which can now be added to those that I have cited, Rumsfeld v Padilla186, Stevens J (Souter, Ginsburg and Breyer JJ joining) explained187: "At stake in this case is nothing less than the essence of a free society. Even more important than the method of selecting the people's rulers and their successors is the character of the constraints imposed on the Executive by the rule of law. Unconstrained Executive detention for the purpose of investigating and preventing subversive activity is the hallmark of the Star Chamber.188" Although Stevens J and his colleagues were in dissent in Padilla, on a technical point concerning the availability of habeas corpus in the circumstances, their substantive opinion was adopted by the Supreme Court of the United States on the same day in Rasul v Bush189. There the claim of the United States Executive to a power to detain persons accused "of terrorist connections without access to lawyers or the outside world and without any possibility of significant review by courts or other judicial bodies"190 was decisively rejected. The resistance of the judiciary to such notions was reaffirmed. These are not, therefore, rare and atypical cases. They are legion. And, in recent times, they have been largely consistent. Approach to statutory construction: The holding in Zadvydas v Davis191, that the statute there in question could be construed so as to avoid an interpretation authorising or requiring indefinite detention of an alien, grew out of the same judicial resistance to the notion of unlimited powers of executive detention. The assumption that the proceedings were "nonpunitive"192 arose 186 72 USLW 4584 (2004). 187 72 USLW 4584 at 4595 (2004) (emphasis added). 188 See Watts v Indiana 338 US 49 at 54 (1949) (opinion of Frankfurter J). "There is torture of mind as well as body; the will is as much affected by fear as by force. And there comes a point where this Court should not be ignorant as judges of what we know as men": 338 US 49 at 52 (1949). 189 72 USLW 4596 (2004). 190 Dworkin, "What the Court Really Said", (2004) 51:13 New York Review of Books 191 533 US 678 at 690 (2001). See reasons of McHugh J at [52]. 192 Zadvydas 533 US 678 at 690 (2001). Kirby specifically because, had it been otherwise, "a serious constitutional problem" would have arisen193. The reasoning therefore follows the approach that Gummow J has adopted in this case, with which I agree. Thus, Zadvydas is highly relevant to the decision in this case. Although the applicable statutory and constitutional provisions are different, the approach that we should take is precisely the same. The same can be said of R v Governor of Durham Prison; Ex parte Hardial Singh194. An arguably open-ended legislative provision was read down to avoid affront to notions that lie deep in the common law which it was assumed Parliament would wish to observe in the absence of clear law demonstrating the contrary. That this is done in England, without the support of a constitutionally stated and entrenched judicial power, makes the force of the judicial resistance to an untrammelled executive power of detention all the more striking. Likewise, in Tan Te Lam v Superintendent of Tai A Chau Detention Centre195 the approach to the judicial function of statutory interpretation adopted by the Privy Council in a Hong Kong appeal can only be explained by reference to the same judicial resistance to unlimited executive detention. In different courts the resistance leads to different techniques of decision-making and to different powers and outcomes. But the common thread that runs through all these cases is that judges of our tradition incline to treat unlimited executive detention as incompatible with contemporary notions of the rule of law. Hence, judges regard such unlimited detention with vigilance and suspicion. They do what they can within their constitutional functions to limit it and to subject it to express or implied restrictions defensive of individual liberty. Wartime cases and actions: In his reasons, McHugh J cites Australian cases and official conduct during the two World Wars to establish the proposition that arbitrary and unrestricted detention by the Executive or under legislation is possible, even usual, in Australia in time of war196. I accept that cases exist that lend support to the conclusion that such detention has occurred and that such powers have been upheld by this Court197. 193 Zadvydas 533 US 678 at 690 (2001). 194 [1984] 1 WLR 704; [1984] 1 All ER 983. See reasons of McHugh J at [53]. 195 [1997] AC 97. See reasons of McHugh J at [54]. 196 See reasons of McHugh J at [55]-[61]. 197 eg Ex parte Walsh [1942] ALR 359 and Little v The Commonwealth (1947) 75 CLR 94, cited by McHugh J at [59]. Kirby However, these cases are the Australian equivalent to the decision of the Supreme Court of the United States in Korematsu v United States198. There the Supreme Court, by majority, upheld the detention of an American-born citizen of Japanese ancestry (and hence many of a like background). Such cases are now viewed with embarrassment in the United States and generally regarded as incorrect199. We should be no less embarrassed by the local equivalents. Certainly, the necessities of war require adaptation of the Constitution and specifically of the power to make laws with regard to defence. However, such necessities cannot support the elimination of constitutional requirements, including those appearing in Ch III. This is because, by the opening words of s 51, the legislative power with respect to defence is subjected to the Constitution, including Ch III. This point was well made by Barak P for the Supreme Court of Israel, sitting as the High Court of Justice in Beit Sourik Village Council v The Government of Israel200. That case concerned a challenge by Palestinian villagers to the "security fence" or wall being constructed on their land. In the course of reasons that upheld some of the petitions, Barak P cited an earlier decision of the Court in The Public Committee against Torture in Israel v The Government of Israel201 in which, after referring to the implications of the decision for national security, he had said: "This is the destiny of a democracy – she does not see all means as acceptable, and the ways of her enemies are not always open before her. A democracy must sometimes fight with one arm tied behind her back. Even so, a democracy has the upper hand. The rule of law and individual liberties constitute an important aspect of her security stance. At the end of the day, they strengthen her spirit and this strength allows her to overcome her difficulties." I do not doubt that if Australia were faced with challenges of war today, this Court, strengthened by the post-War decision in the Communist Party 198 323 US 214 (1944). See also Hirabayashi v United States 320 US 81 (1943). 199 See, for example, Rostow, "The Japanese American Cases – A Disaster", (1945) 54 Yale Law Journal 489; Tushnet, "Defending Korematsu?: Reflections on Civil Liberties in Wartime", (2003) Wisconsin Law Review 273 at 273 ("Rostow's criticism of [Korematsu] has become the common wisdom"). Also see Stenberg v Carhart 530 US 914 at 953 (2000) per Scalia J (diss). 200 HCJ 2056/04 at [86]. 201 HCJ 5100/94 at 845. Kirby Case202 and other cases since, would approach the matter differently than it did in the decisions which McHugh J has cited with apparent approval. Respectfully, I regard them as of doubtful authority in the light of legal developments that occurred after they were written. The actions of Attorney-General Evatt, referred to by McHugh J203, have been described by a biographer as a "cancer" which greatly damaged his reputation204. According to the biographer, the initial arrests of wartime detainees were authorised by the Minister of the Army, on a military submission, not by Dr Evatt, who sought to have most of the detainees freed205. However that may be, the instances hardly amount to a proud moment in Australian law. Nor are they ones that should be propounded as a precedent and statement of contemporary legal authority. Subjective versus purposive interpretation: In his reasons, McHugh J appears to adopt an interpretation of detention legislation that implies that the subjective intentions of the legislators must prevail (eg their knowledge and views at the time of enactment about international law206). I would reject such an approach. Today, legislation is construed by this Court to give effect, so far as its language permits, to its purpose207. This is an objective construct. The meaning is declared by the courts after the application of relevant interpretive principles. It is an approach that has been greatly influenced by McHugh J's own decisions208. The purposive approach accommodates itself readily to an interpretive principle upholding compliance with the international law of human rights. This is because, as Professor Ian Brownlie has explained, municipal or domestic courts when deciding cases to which law, specifically international 202 (1951) 83 CLR 1. 203 Reasons of McHugh J at [60]. 204 Tennant, Evatt – Politics and Justice, (1970, rev 1972) at 147. 205 Tennant, Evatt – Politics and Justice, (1970, rev 1972) at 146-147. 206 Reasons of McHugh J at [65]. 207 Bropho v Western Australia (1990) 171 CLR 1 at 20; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[71]. 208 See Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-424 per Kirby international law is relevant, are exercising a form of international jurisdiction209. In exercising municipal or domestic jurisdiction, such courts give effect to interpretive principles defensive of basic rights as recognised in local law. In exercising international jurisdiction, they likewise give effect to interpretive principles defensive of basic rights upheld by international law. The evolution of constitutional law: A majority of this Court may not yet have accepted the interpretive principle that I favour. However, in 1904, a majority did not accept the principle later upheld in Amalgamated Society of Engineers v Adelaide Steamship Co Ltd210 as a fundamental interpretive principle of the Constitution. It has been applied ever since. In 1921, a majority of this Court did not accept the interpretation of the structure of the Constitution (and of the requirements of Ch III) adopted in 1956 in R v Kirby; Ex parte Boilermakers' Society of Australia211. In Gould v Brown212 a majority could not be found to strike down part of the State cross-vesting legislation. Following changes to the membership of the Court, a majority was assembled little more than one year later in Re Wakim; Ex parte McNally213. There are many similar cases. The understanding of the Constitution in this Court is constantly evolving214. The interpretive principle that I have expressed is but another step in the process of evolution. With great respect to the opinion of Dixon J in Polites v The Commonwealth215 (and to those who have later embraced that view216) his 209 Brownlie, Principles of Public International Law, 5th ed (1998) at 584. See Reference re Secession of Québec [1998] 2 SCR 217 at 234-235 [20]-[22]; Turp and van Ert, "International Recognition in the Supreme Court of Canada's Québec Reference", (1998) The Canadian Yearbook of International Law 335; van Ert, Using International Law in Canadian Courts, (2002) at 44-45. 210 (1920) 28 CLR 129; (1921) 29 CLR 406. 211 (1956) 94 CLR 254. 212 (1998) 193 CLR 346. 213 (1999) 198 CLR 511. 214 Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 215 (1945) 70 CLR 60 at 78. 216 Kartinyeri v The Commonwealth (1998) 195 CLR 337 at 384-385 [98]-[99] per Kirby Honour's notion of the influence of international law on the interpretation of the Australian Constitution can scarcely be treated as the last word. In 1945, when Polites was decided, the Australian Constitution was commonly regarded as little more than a statute of the United Kingdom Parliament, binding in Australia for that reason. In most cases – including many constitutional cases – the decisions of this Court were subject to appeal to the Privy Council. Notions of national independence and distinctive legal thinking in Australia were tamed by these realities. Because of entirely new realities today our thinking is necessarily different. In 1945, the international community was quite different. The Crown of the United Kingdom was still sovereign over a fifth of humanity. Many colonial empires survived. Government by representative democracy and the rule of law were the exception. The global economy was primitive when compared with today. Integrating technology was quite limited. The United Nations had not yet been formed when the decision in Polites was handed down in April 1945. The institutions of the world community had not yet been created. The legal instruments that have declared the human rights and fundamental freedoms of humanity had not yet been adopted. In these circumstances, to have expected even so great a judge as Dixon J to foresee the legal expressions of human rights and fundamental freedoms, founded in the notions of human dignity and the principle of justice recognised in the Charter of the United Nations217 and to appreciate their impact on our Constitution, is to expect too much. He, and our other predecessors, are excused for not foreseeing these developments. Contemporary judges are not excused for ignoring them. McHugh J objects to the use of the "rules" of international law to inform the interpretive principle that I favour218. "Rules" is a word I have not used, preferring as I do "principles" or "basic principles". McHugh J accepts that phenomena other than international law can "result in insights concerning the meaning of the Constitution that were not present to earlier generations"219. Once this concession is made, the difference between McHugh J and myself is narrowed. International law, including as it declares universal human rights and fundamental freedoms, exists in the form of "rules" and discourse. This is the tangible manifestation. "[P]olitical, social or economic developments"220, which McHugh J accepts can throw light on the meaning of the Constitution, generally appear in other forms. But if they can have their influence in the form in which 217 Charter of the United Nations, signed at San Francisco on 26 June 1945, Preamble. 218 Reasons of McHugh J at [62]-[71]. 219 Reasons of McHugh J at [69]. 220 Reasons of McHugh J at [69]. Kirby they exist, so can the "rules" of international law in the form in which they manifest themselves. They do not bind as other "rules" do. But the principles they express can influence legal understanding. Lord Steyn recently observed that in the law, "context is everything"221. There is much truth in his Lordship's dictum. Constitutional law is part of our law and its meaning is thus subject to contextual considerations. The Australian Constitution was understood and applied in 1945 in a completely different international context from that prevailing today. Now, the Constitution speaks not only "to the people of Australia who made it and accept it for their governance. It also speaks to the international community as the basic law of the Australian nation which is a member of that community."222 Inevitably, its meaning is influenced by the legal context in which it must now operate. Whatever may have been possible in the world of 1945, the complete isolation of constitutional law from the dynamic impact of international law is neither possible nor desirable today. That is why national courts, and especially national constitutional courts such as this, have a duty, so far as possible, to interpret their constitutional texts in a way that is generally harmonious with the basic principles of international law, including as that law states human rights and fundamental freedoms223. In practice, this development presents no significant difficulty for a legal system such as Australia's. In part, this is because of the profound influence on the most basic statements of international law (and specifically of the law of human rights and fundamental freedoms) of Anglo-American lawyers and the concepts that they derived from the common law. In part, it is because such rights and freedoms express the common rights of all humanity. They pre- existed their formal expression. Consistency with s 128 of the Constitution: Nor, contrary to the opinion of McHugh J224, is the interpretive principle that I favour inconsistent with the provisions of s 128 of the Constitution governing its formal amendment. If this argument were valid, it would apply equally to other decisions of this Court in 221 R (Daly) v Secretary of State for the Home Department [2001] 2 AC 532 at 548 222 Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 658. 223 Bangalore Principles (1988), reproduced in Kirby, "The Role of the Judge in Advancing Human Rights by Reference to International Human Rights Norms", (1988) 62 Australian Law Journal 514 at 531-532. 224 Reasons of McHugh J at [68]-[69]. Kirby which the Court has given new meaning to the constitutional text and expounded new rights and duties. The Constitution provides both for formal amendment and judicial reinterpretation. From the earliest days of federation both means of adjustment and change have been followed, to the advantage of the Commonwealth and its people. It is idle to suggest otherwise. This Court has played its role in adapting the Constitution to changing times where that was proper and compatible with the constitutional text and legal principle. The developments of international law since 1945 represent no more than another change requiring adaptation. Courts declaring new rights: It is true that, consistently with the Constitution, it is not part of the judicial function to insert a comprehensive Bill of Rights into the Constitution225. Nor may the judiciary "by the back door" incorporate an international treaty (even one ratified by Australia) as part of Australian law where the Parliament has not done so by legislation226. Whether a Bill of Rights should be adopted in Australia by legislation, constitutional amendment or at all, is a political question. The limits inherent in the interpretive principle favouring consistency with the principles of international law, specifically the international law of human rights and fundamental freedoms, must be observed by the courts. Where the Constitution or a valid national law are clear, the duty of a court, which derives its power and authority from the Constitution, is to give effect to the law's requirements227. As such, international law is not part of, nor superior to, our constitutional or statute law. Unless incorporated, it is not part of our municipal law. Nevertheless it is incorrect, with respect, to say that Australian courts, including this Court, have no function in finding "rights" in the text of the Constitution. Some of this Court's decisions, declaring what are in effect "rights", would have been regarded by the founders as astonishing. In deriving a number of them, McHugh J has played a notable part228. Thus, the courts in Australia are also law-makers; but in a confined and restricted way acting in accordance with the Constitution and established legal principle. 225 Reasons of McHugh J at [73]. 226 Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 288. 227 See eg Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 78 ALJR 737 at 768-769 [169]-[173]; 206 ALR 130 at 172-173. 228 Notably in Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51; Lange v Australian Broadcasting Corporation (1997) 189 CLR 520; Austin v The Commonwealth (2003) 77 ALJR 491; 195 ALR 321. A non-constitutional case of the same character is Mabo v Queensland [No 2] (1992) 175 CLR 1 at 15-16. Kirby I do not agree with McHugh J229 that the content of the trade and commerce power, expressed in the Constitution230, is unaffected by the great changes that have occurred in global trade since 1901; nor influenced by multilateral, regional and bilateral agreements in which Australia has participated. With respect, to suggest that, were it otherwise, judges would need a "loose-leaf" copy of the Constitution trivialises a serious question231. If the defence power expands and contracts, as it does, by reference to the needs of war and a state of profound peace232, so it is with the trade and commerce power and every other federal head of power in the Australian constitutional list. In the case of most powers, the differences may not always be so noticeable or profound as in cases concerning the defence power. However, in terms of constitutional principle, the concept must be the same. In any event, constitutional lawyers do indeed have "loose-leaf" copies of the Constitution in which the text is elaborated by the decisions of this and other courts, and which refer to contextual, historical and other materials essential to the evolving understanding of what the Constitution means and how it operates. I have simply indicated the need, in the present age, to add a reference to one of the most important legal developments that is occurring and to which national constitutions must adapt, namely the growing role of international law, including the law relating to human rights and fundamental freedoms. The approach of other countries: The constitutional courts of many other countries now adopt the interpretive approach that I favour233. They reject the 229 Reasons of McHugh J at [71]. 230 Constitution, s 51(i). See also s 92. 231 Reasons of McHugh J at [73]. 232 Constitution, s 51(vi). See, for example, Farey v Burvett (1916) 21 CLR 433 at 441; R v Foster; Ex parte Rural Bank of NSW (1949) 79 CLR 43 at 81. Fugue or Fusion? 233 See, for example, "The International Judicial Dialogue: When Domestic Constitutional Courts Join the Conversation", (2001) 114 Harvard Law Review 2049; LeBel and Chao, "The Rise of International Law in Canadian Constitutional Litigation: Recent Developments and Challenges in Internalizing International Law", (2002) 16 Supreme Court Law Review (2d) 23; Spiro, "Treaties, International Law, and Constitutional Rights", (2003) 55 Stanford Law Review 1999 at 2026-2027; Bodansky, "The Use of International Sources in Constitutional Opinion", (2004) 32 Georgia Journal of International and Comparative Law 421; Neuman, "The Uses of International Law in Constitutional Interpretation", (2004) 98 American Journal of International Law 82. Kirby approach that McHugh J supports in this case. It is true that in some cases, the new process of reasoning has been stimulated by express constitutional provisions requiring that regard be had to the provisions of international law234. This is so, for example, under the new Constitution of the Republic of South Africa235. However, the Constitutional Court of South Africa has said that, even if such an express provision did not exist in the text, international law would necessarily have been considered where it was relevant236. It is also true that in some cases, the references to the developing jurisprudence of international and regional courts and other bodies have been stimulated by the existence of human rights provisions in the national constitution expressed in terms similar to the international and regional statements of human rights and fundamental freedoms. This is not a significant consideration in the Australian context. However, the willingness of national constitutional courts to look outside their own domestic legal traditions to the elaboration of international, regional and other bodies represents a paradigm shift that has happened in municipal law in recent years. There are many illustrations in the decisions of the courts of, for example, Canada237, Germany238, India239, New Zealand240, the United Kingdom241 and the United States242. 234 eg The Constitution of India (1950), s 51(c). 235 The Constitution of the Republic of South Africa (1996), ss 39(1)(b), 233. 236 S v Makwanyane 1995 (3) SA 391 at 413-414 [34]-[35] (referring to s 35(1) of the now superseded transitional constitution: Interim Constitution (1993)). 237 eg Reference re Public Service Employee Relations Act (Alberta) [1987] 1 SCR 313 at 348; Suresh v Canada (Minister of Citizenship and Immigration) [2002] 1 SCR 3 at 31-32 [46], 38 [60] ("in seeking the meaning of the Canadian Constitution, the courts may be informed by international law"). 238 eg Presumption of Innocence and the European Convention on Human Rights (1987) BverfGE 74, 358, the Bundesverfassungsgericht – Federal Constitutional Court – Federal Republic of Germany, vol 1/II (1992). in Decisions of into English translated 239 eg Vishaka v State of Rajasthan 1997 AIR SC 3011 at 3015. 240 eg Tavita v Minister of Immigration [1994] 2 NZLR 257 at 266. 241 eg Pratt v Attorney-General for Jamaica [1994] 2 AC 1 (PC). 242 See the extracurial remarks of Ginsburg J in Ginsburg and Merritt, "Fifty-First Cardozo Memorial Lecture – Affirmative Action: An International Human Rights Dialogue", (1999) 21 Cardozo Law Review 253 at 282, and of O'Connor J in (Footnote continues on next page) Kirby The developments in the Supreme Court of the United States are most pertinent to the criticisms that McHugh J has expressed in this case. Until recently, the approach of that Court concerning the elaboration of the United States Constitution commonly reflected the propositions that McHugh J has stated. However, lately, in Atkins v Virginia243 and Lawrence v Texas244 there is evidence of a new willingness on the part of that Court to pay regard to international and regional law where such considerations may help to throw light on the contemporary meaning of provisions of the United States Constitution. In Lawrence, in words somewhat similar to views that I have expressed in this Court245, Kennedy J, for the Supreme Court, after references to international "Had those who drew and ratified the Due Process Clauses of the Fifth Amendment or the Fourteenth Amendment known the components of liberty in its manifold possibilities, they might have been more specific. They did not presume to have this insight. They knew times can blind us to certain truths and later generations can see that laws once thought necessary and proper in fact serve only to oppress. As the Constitution endures, persons in every generation can invoke its principles in their own search for greater freedom." O'Connor, "Keynote Address", (2002) 96 American Society of International Law Proceedings 348 at 350-351. 243 536 US 304 at 316 n 21 (2002). 244 539 US 558 at 576-577 (2003). See also Grutter v Bollinger 539 US 306 at 344 245 Re Wakim (1999) 198 CLR 511 at 599-600 [186]. 246 Lawrence 539 US 558 at 576-577 (2003). Most especially, decisions of the European Court of Human Rights in Dudgeon v United Kingdom (1981) 4 EHRR 149; Norris v Ireland (1988) 13 EHRR 186 and Modinos v Cyprus (1993) 16 EHRR 485. 247 Lawrence 539 US 558 at 578-579 (2003). Kirby This shift in approach to deriving the meaning of a national constitution has attracted both support248 and criticism249 in the United States. In the Supreme Court itself, in Atkins250 and in Lawrence251, Scalia J voiced for the dissenters opinions not dissimilar to those expressed by McHugh J in this case. However, the majority view in the United States now appears to favour the interpretive principle that I have accepted. When such a court, in a legal culture traditionally less open to outside legal ideas than ours has been, accepts the relevance for its reasoning of the jurisprudence emerging from a "wider civilization"252, it is time for this Court to do likewise. It is incorrect to say, as McHugh J does253, that Lawrence merely used "European case law" to reject a premise in an earlier decision. That is only half the story254. The opinion of Kennedy J in Lawrence expressly refers to an amicus brief filed by Professor Mary Robinson, past United Nations High Commissioner for Human Rights. As Professor Koh has pointed out255, that brief referred to a wide range of materials in international law – including a decision of the United Nations Human Rights Committee in Toonen v Australia256. In any event, the "European case law" itself relies upon rules expressed in the European Convention on Human Rights that have exact equivalents in the international law of human rights and fundamental freedoms. If Lawrence involved such an inconsequential step in reasoning, as McHugh J appears to think, it has obviously 248 eg Koh, "International Law as Part of Our Law", (2004) 98 American Journal of International Law 43; Neuman, "The Uses of International Law in Constitutional Interpretation", (2004) 98 American Journal of International Law 82. 249 eg Alford, "Misusing International Sources to Interpret the Constitution", (2004) 98 American Journal of International Law 57. 250 536 US 304 at 347-348 (2002). 251 539 US 558 at 586 (2003). 252 539 US 558 at 576 (2003) per Kennedy J for the Court. 253 Reasons of McHugh J at [72]. 254 See, for example, Jackson, "Could I Interest You in Some Foreign Law? Yes Please, I'd Love to Talk With You", (2004) August Legal Affairs 43 at 45. 255 Koh, "International Law as Part of Our Law", (2004) 98 American Journal of International Law 43 at 50. 256 Human Rights Committee Communication No 488/1992 (1994). Kirby deceived Scalia J257 and many commentators258 who have thought, and said, otherwise. Therefore, with every respect to those of a contrary view, opinions that seek to cut off contemporary Australian law (including constitutional law) from the persuasive force of international law are doomed to fail259. They will be seen in the future much as the reasoning of Taney CJ in Dred Scott v Sandford260, Black J in Korematsu261 and Starke J in Ex parte Walsh262 are now viewed: with a mixture of curiosity and embarrassment. The dissents of McLean J263 and Curtis J264 in Dred Scott265 strongly invoked international law to support the proposition that the appellant was not a slave but a free man. Had the interpretive principle prevailed at that time, the United States Supreme Court might have been saved a serious error of constitutional reasoning; and much injustice, indifference to human indignity and later suffering might have been avoided. The fact is that it is often helpful for national judges to check their own constitutional thinking against principles expressing the rules of a "wider civilization". 257 Lawrence 539 US 558 at 586 (2003). 258 See above at [188], n 248, 249. See also Posner, "Could I Interest You in Some Foreign Law? No Thanks, We Already Have Our Own Laws", (2004) August Legal Affairs 40. Compare Jackson, "Could I Interest You in Some Foreign Law? Yes Please, I'd Love to Talk With You", (2004) August Legal Affairs 43; Alford, "Federal Courts, International Tribunals, and the Continuum of Deference: A Postscript on Lawrence v Texas", (2004) 44 Virginia Journal of International Law 259 Eskridge, "United States: Lawrence v Texas and the imperative of comparative constitutionalism", (2004) 2 International Journal of Constitutional Law 555 at 260 60 US 393 (1856) (holding that Mr Scott was still a slave in the United States). 262 [1942] ALR 359 at 360, cited by McHugh J at [59]. 263 60 US 393 at 534, 556-557 (1856). 264 60 US 393 at 594-597, 601 (1856). Kirby My conclusion is no more a judicial attempt to "amend[] the Constitution under the guise of interpretation"266 than were the many decisions of this Court, in which McHugh J participated, where the process of interpretation produced a significant change to earlier understandings of that document267. If one new interpretation is forbidden, so are others. We should not declare interpretations impermissible just because we do not agree with them. As McHugh J has written elsewhere268: "Questions of construction are notorious for generating opposing answers, none of which can be said to be either clearly right or clearly wrong." These words apply equally to constitutional construction. It is for these reasons, and others that must await later exposition, that I disagree with what McHugh J has written. Conclusion: interpretive principle: In my view, this Court should read ss 196 and 198 of the Act in a way that restricts any assertion that a purely literal construction might otherwise sustain, that unlimited executive detention was there enacted. It should do so because that construction is available in the language of the Act and the assumptions disclosed by that language. It should do so because, in that way, a "serious constitutional problem"269 that would otherwise be raised is avoided. And it should do so because that interpretation is consistent with the principles of the international law of human rights and fundamental freedoms that illuminate our understanding both of the provisions of the Act and of the Constitution applicable to this case. Orders I agree in the orders proposed by Gummow J. 266 Reasons of McHugh J at [74]. 267 eg Nationwide News Pty Ltd v Wills (1992) 177 CLR 1; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 238; Cheatle v The Queen (1993) 177 CLR 541 at 560-561; Kable (1996) 189 CLR 51 at 116-119; Ha v New South Wales (1997) 189 CLR 465 at 504; Lange (1997) 189 CLR 520; Nicholas v The Queen (1998) 193 CLR 173 at 226 [126]-[127]; cf Mabo [No 2] (1992) 175 CLR 1 at 15-16; Dietrich v The Queen (1992) 177 CLR 292 at 302-306. 268 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1524 [42]; 200 ALR 157 at 168. 269 Zadvydas 533 US 678 at 690 (2001). See above at [159]. Hayne 195 HAYNE J. The appellant, born of Palestinian parents in Kuwait, is stateless. In December 2000 he arrived, by boat, in Australia. He had no visa permitting him to enter or remain here. He was taken into immigration detention and applied for a protection visa. His application was refused and his applications for review of that refusal failed. In August 2002, he wrote to the Minister asking to be removed from Australia as soon as reasonably practicable. He has not been removed. In 2003, he commenced two proceedings in the Federal Court of Australia. Attention need be given only to the proceeding commenced on 12 February 2003 in which he sought a declaration that his continued detention was unlawful, habeas corpus and prohibition to achieve his release from that detention, and mandamus directing the Minister, among other things, to remove him from Australia. That application was dismissed and he gave notice of appeal to the Full Court of the Federal Court. That appeal has been removed into this Court by order made under s 40 of the Judiciary Act 1903 (Cth). It was heard at the same time as Behrooz v Secretary of the Department of Immigration and Multicultural and Indigenous Affairs270 and Minister for Immigration and Multicultural and Indigenous Affairs v Al Khafaji271. At the trial of the appellant's application to the Federal Court, the primary judge was not satisfied that officers of the Department were "not taking all reasonable steps to secure the removal from Australia" of the appellant. The primary judge did find, however, that "removal from Australia is not reasonably practicable at the present time as there is no real likelihood or prospect of removal in the reasonably foreseeable future". That finding is not challenged. The central issue in the appeal is whether, in those circumstances, the continued detention of the appellant is lawful. These reasons will seek to demonstrate that it is. Mandatory detention The appellant is detained pursuant to ss 189 and 196 of the Migration Act 1958 (Cth). Section 189(1) requires "an officer" who knows or reasonably suspects that a person in the migration zone is an unlawful non-citizen to detain that person. Section 196 provides that an unlawful non-citizen detained under "must be kept in immigration detention until he or she is: 270 [2004] HCA 36. 271 [2004] HCA 38. Hayne removed from Australia under section 198 or 199; or deported under section 200; or granted a visa." (emphasis added) The appellant is not eligible for deportation under s 200. That provision deals with the deportation of non-citizens who are convicted of certain crimes (ss 201 and 203) and the deportation of non-citizens upon security grounds (s 202). Section 199 deals with the dependants of removed non-citizens. Section 198 provides that in certain circumstances an officer must remove an unlawful non-citizen "as soon as reasonably practicable". One of those circumstances is if the unlawful non-citizen asks the Minister in writing to be removed (s 198(1)). The appellant has done that. He is eligible for removal under s 198. To understand the issues which now arise, it is necessary to examine some of the history of the regulation of immigration to Australia. Some matters of history Since before federation, control of immigration to Australia has had a prominent place in Australian law and politics. In the first year of federation, the Parliament passed the Immigration Restriction Act 1901 (Cth) "to place certain restrictions on Immigration and the Commonwealth of prohibited Immigrants". For more than 90 years, legislation prohibited various classes of person from entering the Commonwealth272 and made it a criminal offence to enter, or to be found within, the Commonwealth as a prohibited immigrant273. For many years274, the dictation test was used to exclude persons, or classes of person, whom the government of the day deemed undesirable immigrants. The operation of that test was considered by this Court many times275. the removal from to provide for 272 Immigration Restriction Act 1901 (Cth), s 3. 273 Immigration Restriction Act, s 7. 274 Until the Migration Act 1958 (Cth). 275 See, for example, Chia Gee v Martin (1905) 3 CLR 649; Potter v Minahan (1908) 7 CLR 277; R v Carter; Ex parte Kisch (1934) 52 CLR 221; R v Wilson; Ex parte Kisch (1934) 52 CLR 234; R v Fletcher; Ex parte Kisch (1935) 52 CLR 248; R v Davey; Ex parte Freer (1936) 56 CLR 381; Gamble v Lau Sang (1943) 67 CLR 455; O'Keefe v Calwell (1949) 77 CLR 261. Hayne The statutory provisions, by which it was made an offence to enter or be found within the Commonwealth as a prohibited immigrant, provided for the imprisonment of the offender and for deportation, pursuant to an order of the Minister, during or after the term of imprisonment276. Some aspects of the operation of provisions of this kind were considered in Chu Shao Hung v The Queen277, but the validity of such provisions was established much earlier in this Court's history. In one of its earliest decisions278, the Court held that it is an attribute of sovereignty that every nation state is entitled to decide what aliens shall or shall not become members of its community. It further held that the grant to the federal Parliament of power to make laws with respect to aliens (s 51(xix)) and with respect to immigration (s 51(xxvii)) validly authorised the enactment of a law permitting the deportation of an alien to a place other than the state from which the alien came. That power was held to extend to permitting the detention of the alien and, because of Australia's geographical position, it necessarily permitted the imprisonment, beyond the territorial jurisdiction of Australia, of the person deported. Griffith CJ said279: "The power to make such laws as Parliament may think fit with respect to aliens must surely, if it includes anything, include the power to determine the conditions under which aliens may be admitted to the country, the conditions under which they may be permitted to remain in the country, and the conditions under which they may be deported from it. I cannot, therefore, doubt that the Commonwealth Parliament has under that delegation of power authority to make any laws that it may think fit for that purpose; and it is not for the judicial branch of the Government to review their actions, or to consider whether the means that they have adopted are wise or unwise." The Migration Reform Act 1992 (Cth) In 1992, a radical change was made to the legislative scheme for dealing with those who entered Australia without entitlement. The Migration Reform Act 1992 (Cth) repealed those provisions of the Migration Act by which it was made an offence for a prohibited immigrant to enter or be found within the 276 Immigration Restriction Act, s 7. 277 (1953) 87 CLR 575. 278 Robtelmes v Brenan (1906) 4 CLR 395. 279 (1906) 4 CLR 395 at 404. Hayne Commonwealth280. Instead, the Act, as amended281, divided non-citizens into two categories: one described as "lawful non-citizens" and the other described as "unlawful non-citizens". The former category was defined as non-citizens in the migration zone who held a visa (s 14). (Certain other kinds of non-citizen and allowed inhabitants were also included in this class.) The latter category, of unlawful non-citizens, was defined as those non-citizens in the migration zone who were not lawful non-citizens. The Act, again as amended282, obliged "officers" to detain all who were known or suspected of being unlawful non-citizens. An "officer" was then defined, in effect, as an officer of the Department, a person who was an officer for the purposes of the Customs Act 1901 (Cth), a federal, State or Territory police officer, or a protective service officer under the Australian Protective Service Act 1987 (Cth). The definition of "officer" has since been amended but nothing was said to turn on its details. The Act further required283 that unlawful non-citizens be kept in detention until they were removed or deported from Australia, or were granted a visa which would entitle them to remain. The Act obliged284 officers to remove unlawful non-citizens as soon as reasonably practicable after the final determination of any application for a visa, or upon the request of the unlawful non-citizen concerned285. The criminal law was engaged only by providing (see now, s 197A) that it was an offence to escape immigration detention. These provisions for the mandatory detention of unlawful non-citizens applied regardless of whether the person concerned was seeking permission to remain in Australia (whether as a refugee or otherwise). They applied even if the person concerned had entered Australia with permission but that permission had later terminated. All who did not have a valid permission to enter and remain in Australia were "unlawful non-citizens" and were to be detained. The use of the terms "lawful" and "unlawful" in the description of immigration status must, therefore, be understood as no more than a reference to 280 Migration Reform Act 1992 (Cth), s 17. 281 Migration Act, ss 14, 15. 282 s 54W. 283 s 54ZD. 284 s 54ZF. 285 s 54ZF(1). Hayne whether the non-citizen had that permission. The use of those terms (and in particular the epithet "unlawful") did not refer to any breach of a law which expressly prohibited the conduct of entering or remaining in Australia without permission. Although the provisions introduced by the Migration Reform Act have since been amended, and renumbered, the legislative provisions dealing with unlawful non-citizens which now fall for consideration can be seen to follow the same pattern as the 1992 provisions. The scheme of the current provisions It will be necessary to consider some issues about the proper construction of the particular provisions in question. Before doing that, however, it is convenient to say something further about the scheme which those provisions reveal. It is a scheme having three principal features. First, non-citizens may enter Australia if they have permission (a visa) to do so; they may remain in Australia for so long as they have permission (again in the form of a visa) to do so. Secondly, if a non-citizen has entered Australia without permission, or no longer has permission to remain here, that non-citizen must be detained. Thirdly, the detention of a non-citizen is to end only upon that person's removal or deportation from Australia or upon the person obtaining a visa permitting him or her to remain in the country. Removal or deportation must occur "as soon as reasonably practicable" after the conclusion of any attempts the non-citizen has made to procure a visa, or after that person has made a written request to be removed. The hypothesis for consideration of all of the arguments advanced in this and the other matters heard with it must be that the person whose detention is in question is someone who does not have permission to remain in Australia. Often, but not invariably, those detained will be persons who arrived in Australia without permission to enter the country. (None of the non-citizens in these cases had permission to enter.) But whether or not that is so, each must be a person who has no permission to remain in the country. The underlying questions At the base of the arguments advanced in this matter, and the other two matters heard with it, lie questions about whether, and to what extent, the statutory scheme requiring mandatory detention of unlawful non-citizens is consonant with the long-established principle that "[n]o part of the judicial power [of the Commonwealth] can be conferred in virtue of any other authority or Hayne otherwise than in accordance with the provisions of Chap III"286. In particular, given that deprivation of liberty is the harshest form of punishment now exacted for wrongdoing in Australia, is there a point at which detention of an unlawful non-citizen could validly be required only in the exercise of the judicial power? Are the circumstances in which unlawful non-citizens are detained relevant to deciding whether the law permitting or requiring such detention is valid? Are these considerations which shed light on the proper construction of those provisions of the Migration Act under which the non-citizens who are parties to these proceedings are or have been held? Can an unlawful non-citizen be detained without a judicial determination of wrongdoing accompanied by imposition of a sentence of imprisonment? Does there come a point when continued detention without judicial determination becomes unlawful? The application of the criminal law It must be noted that, since the 1992 amendments, the criminal law has been engaged at a later point than was previously the case. Under the legislation which operated between 1901 and the 1992 amendments, the act of entering or being found within Australia without permission was made a criminal offence. In many cases, persons who contravened the relevant legislation would be made available for removal or deportation because they would be imprisoned. But the administrative assumption which lay behind this system was that any question about permission to enter Australia would ordinarily be decided at the point of entry. And if entry was refused it would be for the vessel which brought the applicant to Australia to remove that person. Where the applicant would be taken in such a case was not a matter to which the legislation directed attention. It was treated as a matter for the applicant and the carrier. Where a person was "found within" Australia as a prohibited immigrant, arrangements necessary for that person's deportation or removal could be made during the person's period of imprisonment. And at least in the earlier part of the 20th century, the assumption that such arrangements could readily be made might have been thought to be well founded. Since the 1992 amendments, the criminal law is engaged only to impose a sanction for escaping from detention. Standing alone, that shift in the point at which the criminal law is engaged does not demonstrate that the detention which the Act required raises a Ch III question about the validity of the provisions which required detention. To make it an offence to leave the customs and immigration controlled area at a point of entry to Australia, like an airport, without first having obtained permission to do so would not, standing alone, 286 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270 per Dixon CJ, McTiernan, Fullagar and Kitto JJ. Hayne suggest that the restraint on freedom of movement which is implicitly required could validly be imposed only in the exercise of the judicial power. And it is this reasoning which underpins the Court's decision in Chu Kheng Lim v Minister for Immigration287. In Chu Kheng Lim, the Court held that the legislative power given by s 51(xix) of the Constitution with respect to aliens extended to conferring, upon the Executive, authority to detain an alien in custody for the purposes of expulsion or deportation. The terms in which that authority was then conferred on the Executive were held not to contravene Ch III. In considering the various issues that have been raised in this matter it is essential, therefore, to bear steadily in mind that Chu Kheng Lim established that the deprivation of liberty of a non-citizen who seeks permission to enter or remain in this country does not, of itself, require the conclusion that the legislation permitting the detention is constitutionally infirm. It will be necessary to say more about the decision in Chu Kheng Lim but it is desirable to come to that case only after considering a number of other matters. First, what is it about the appellant's detention to which attention was drawn? The critical features of detention The arguments advanced in this and the other matters against the validity of the provisions for mandatory detention of unlawful non-citizens proceeded from the identification of two critical features of the provisions. First, the detention required is for an indeterminate length of time. Its duration is bounded by the occurrence of events which, if they happen, will happen at a time which cannot be identified at the start of the period of detention. Secondly, it is now recognised that there may be cases where the events upon which detention will cease may not happen, or at least will not happen for a very long time. It is this uncertainty, about whether or when detention will cease, that is said to present issues about the proper construction of the provisions, and to engage consideration of Ch III. It is important to examine why there is that uncertainty. Detention comes to an end upon removal or deportation or the granting of a visa. Removal or deportation may occur only when the non-citizen's attempts to obtain permission to remain in Australia have come to an end. To that extent the period of detention is under the control of the non-citizen. He or she will be available for removal or deportation as soon as he or she wishes to be available. But what more recent events, concerning some non-citizens who have asked to be removed, have revealed is that removal to a country requires the co-operation of the receiving country, and of any countries through which the person concerned 287 (1992) 176 CLR 1. Hayne must pass to arrive at that destination. That co-operation is not always freely made available. In such a case the period of detention will come to an end only upon the relevant authorities, in one or more countries other than Australia, agreeing to receive the person being removed, or, where it is necessary, agreeing to allow that person to travel through their territory. Australia can seek that co-operation; it cannot demand it. Detention will continue until that co-operation is provided. It is then necessary to notice one further matter about the detention of an unlawful non-citizen. It is not suggested that the alternative to detention is unconditional admission to Australia. The debate assumed that there could be no objection to a legislative scheme that would curtail a non-citizen's freedom of movement within Australia, whether by requiring the non-citizen to report regularly or even, perhaps, by requiring the person to live at a particular place. (How such a provision could fit with s 92 of the Constitution was not explored288.) And if the non-citizen were to be prevented from working, and were not to be eligible for social security benefits, there would be many cases where the non-citizen would depend upon the charity of others to survive while living subject to restrictions not applicable to citizens or lawful non-citizens. The questions which arise about mandatory detention do not arise as a choice between detention and freedom. The detention to be examined is not the detention of someone who, but for the fact of detention, would have been, and been entitled to be, free in the Australian community. It is convenient to deal at this point with some questions about the construction of the relevant provisions. Construction of the relevant provisions Division 7 of Pt 2 of the Migration Act (ss 188-197) provides for the detention of unlawful non-citizens. Division 7A of that Part (ss 197A and 197B) provides for certain offences relating to immigration detention. Division 8 (ss 198-199) provides for removal of unlawful non-citizens and Div 9 (ss 200-206) provides for deportation of certain non-citizens. The text of relevant provisions has been sufficiently described earlier. Most attention must be directed to the three provisions I identified earlier: s 189 (providing for the detention of unlawful non-citizens), s 196 (dealing with the period of detention) and s 198 (providing for removal from Australia of unlawful non-citizens). It was submitted that, properly construed, these provisions did not authorise the appellant's detention. They do not authorise, so it was submitted, 288 AMS v AIF (1999) 199 CLR 160. Hayne the continued detention of unlawful non-citizens where s 198 could not be complied with. Questions about the construction of these provisions, and about their validity, must be considered having regard to the way in which the provisions interact. That is, these questions must be considered having regard to the three principal features of the scheme identified earlier in these reasons: provision for the grant of permission to enter and remain in Australia; imposition of an obligation to detain those who do not have that permission; and the detention of those who do not have permission to enter and remain in Australia until they either gain that permission or are removed. The provisions requiring detention of unlawful non-citizens do not expressly refer to the purpose of detention. Rather, s 189 requires officers to detain unlawful non-citizens and s 196 identifies the period of detention. In this respect, however, the legislation does not differ in any fundamental respect from the provisions considered in Koon Wing Lau v Calwell289. The War-time Refugees Removal Act 1949 (Cth), considered in that case, provided for the deportation of aliens who had entered Australia during the Second World War. It provided (s 7(1)(a)) that a deportee might "pending his deportation and until he is placed on board a vessel for deportation from Australia" be kept in such custody as the Minister or an officer directed. Of these provisions Dixon J said290 that they "mean that a deportee may be held in custody for the purpose of fulfilling the obligation to deport him until he is placed on board the vessel" (emphasis added) and that "unless within a reasonable time [the person to be deported] is placed on board a vessel he would be entitled to his discharge on habeas". The present legislation, prescribing the period of detention as it does, may therefore be read as providing for detention for the purposes of processing any visa application and removal. But that does not decide the point of how long that detention may persist. It does not decide when that purpose (of detention for removal) is spent. It does not decide that the time during which a person may be detained is "a reasonable time". Here the period of detention is governed by the requirement to effect removal "as soon as reasonably practicable". The period of detention is fixed by reference to the occurrence of any of three specified events. Detention must continue "until" one of those events occurs. The event described as being "removed from Australia under section 198" is an event the occurrence of which is affected by the imposition of a duty, by s 198, to bring about that event "as soon as reasonably practicable". 289 (1949) 80 CLR 533. 290 (1949) 80 CLR 533 at 581. Hayne That compound temporal expression recognises that the time by which the event is to occur is affected by considerations of what is "[c]apable of being put into practice, carried out in action, effected, accomplished, or done"291. In particular, the expression recognises that the co-operation of persons, other than the non-citizen and the officer, will often (indeed usually) be necessary before the removal can occur. The duty to remove must be performed within that time. And so long as the time for performance of that duty has not expired, s 196 in terms provides that the non-citizen must be detained. It may be accepted that "as soon as reasonably practicable" assumes that the event concerned can happen, and that, if there is any uncertainty, it is about when the event will happen, not whether it will. Where, as here, the person to be removed is stateless, there is no state to which Australia can look as the first and most likely receiving country. But whether the non-citizen is stateless or has a nationality, Robtelmes v Brenan reveals that the removal provisions of the Act are concerned with what was there identified292 as the corollary to, or complement of, the power of exclusion. Removal is the purpose of the provisions, not repatriation or removal to a place. It follows, therefore, that stateless or not, absent some other restriction on the power to remove, a non-citizen may be removed to any place willing to receive that person. It follows that, unless some other provision of the Act restricts the places to which a non-citizen may be removed (and none was said to be relevant here), the duty imposed by s 198 requires an officer to seek to remove the non-citizen to any place that will receive the non-citizen. And the time for performance of the duty does not pass until it is reasonably practicable to remove the non-citizen in question. In the case of a stateless person, there may be many countries which could properly be approached and asked to receive the person. Whether one of those countries agrees to take the person will ordinarily depend upon matters beyond the power of Australia. Indeed, whether the country of nationality of a non-citizen who is not stateless will receive that person, if expelled from Australia, will ordinarily depend upon matters beyond this country's power to control, perhaps even influence. What follows is that the most that could ever be said in a particular case where it is not now, and has not been, reasonably practicable to effect removal, is that there is now no country which will receive a particular non-citizen whom Australia seeks to remove, and it cannot now be predicted when that will happen. Nor is it to say that the time for performing the duty imposed by s 198 has come. 291 The Oxford English Dictionary, 2nd ed (1989), vol 12 at 269, "practicable". 292 (1906) 4 CLR 395. Hayne The duty remains unperformed: it has not yet been practicable to effect removal. That is not to say that it will never happen. This appellant's case stands as an example of why it cannot be said that removal will never happen. His prospects of being removed to what is now the territory in Gaza under the administration of the Palestinian Authority are, and will continue to be, much affected by political events in several countries in the Middle East. It is not possible to predict how those events will develop. The most that can be decided with any degree of certainty is whether removal can be effected now or can be effected in the future pursuant to arrangements that now exist. Of course, it must be accepted in the present appeal that, as the primary judge found, "there is no real likelihood or prospect of [the appellant's] removal in the reasonably foreseeable future", but that does not mean it will never occur. Whether and when it occurs depends largely, if not entirely, upon not only the course of events in the Middle East (his preferred destination being Gaza) but also upon the willingness of other countries to receive stateless Palestinians. Because there can be no certainty about whether or when the non-citizen will be removed, it cannot be said that the Act proceeds from a premise (that removal will be possible) which can be demonstrated to be false in any particular case. And unless it has been practicable to remove the non-citizen it cannot be said that the time for performance of the duty imposed by s 198 has arrived. All this being so, it cannot be said that the purpose of detention (the purpose of removal) is shown to be spent by showing that efforts made to achieve removal have not so far been successful. And even if, as in this case, it is found that "there is no real likelihood or prospect of [the non-citizen's] removal in the reasonably foreseeable future", that does not mean that continued detention is not for the purpose of subsequent removal. The legislature having authorised detention until the first point at which removal is reasonably practicable, it is not possible to construe the words used as being subject to some narrower limitation such, for example, as what Dixon J referred to in Koon Wing Lau as "a reasonable time". The time for removal is fixed by this legislation by reference to reasonable practicability. Unaffected by consideration of Ch III, the words of the relevant provisions will not yield, by a process of construction, the meaning asserted by the appellant. There are, however, some additional reasons for rejecting a construction that would limit the power of detention, as the appellant submitted, to such time as removal is reasonably practicable in the sense that there is a real likelihood of removal in the reasonably foreseeable future293. 293 Minister for Immigration and Multicultural and Indigenous Affairs v Al Masri (2003) 126 FCR 54. Hayne This additional set of reasons for rejecting this construction of the provisions turns upon how the criterion for deciding whether there is a real likelihood of removal would be formulated, and upon how the three critical provisions (ss 189, 196 and 198) would then be read together. Formulating the applicable criterion may be thought to be no more than a challenge to legal ingenuity but upon examination the problem will be seen to be more deeply rooted than a question about how to draft the limitation. The consideration of this set of reasons may begin by examining the criterion identified by the Full Court of the Federal Court in Minister for Immigration and Multicultural and Indigenous Affairs v Al Masri294. There, the Full Court held295 that the power to detain a person was impliedly limited to detention only in circumstances where "there is a real likelihood or prospect of the removal of the person from Australia in the reasonably foreseeable future". This formulation of the limitation appears to present some substantial difficulties of application. What is meant by "real likelihood or prospect"? In particular, what is to be done in cases where negotiations for receiving particular non-citizens are continuing, but are at a stage where it cannot be said when they will conclude, or how they will conclude? Is the lawfulness of detention to turn only upon whether the detaining authority can point to some request that it has made of another country that it receive the non-citizen concerned and which it can show has not finally been rejected by that other country? All of these are questions which would ultimately find an answer. Other questions are more difficult. If the statutory command in s 196 (that an unlawful non-citizen must be kept in immigration detention until he or she is removed) is to be read subject to this or some similar limitation, so too must the statutory command in s 189 (requiring an officer to detain unlawful non-citizens). But presumably the duty imposed by s 198 would remain unaffected. And unless the obligations under both ss 189 and 196 were to be regarded as wholly exhausted upon it being found that there is no real likelihood of removal in the reasonably foreseeable future, upon what event would a duty to detain re-emerge? How would that event be defined? Is it the renewed possibility of removal, or is it something more concrete? 294 (2003) 126 FCR 54. 295 (2003) 126 FCR 54 at 88 [136]. Hayne The process of construction of the words used in ss 189, 196 and 198 yields no ready answer to these questions. Rather, what the questions reveal is that the limitation on the operation of ss 189 and 196 identified in Al Masri is a limitation which depends upon taking the temporal element of the legislative command in s 198 (to remove as soon as reasonably practicable) and converting that into a different temporal limitation on the operation of s 196 and, by inference, on the operation of s 189. The limitation imposed is not simply transferred from one section to the others (a process which can readily be justified by the need to read the provisions together). It is transformed from "as soon as reasonably practicable" to "soon" or "for so long as it appears likely to be possible of proximate performance". That transformation cannot be effected by any process of construction, at least not by any process divorced from considerations of Ch III. Limitation by reference to international obligation? In particular the transformation just identified cannot be effected by reference to international instruments, whether the International Covenant on Civil and Political Rights ("the ICCPR"), to which the Full Court referred296 in Al Masri, or other relevant instruments or principles. Let it be assumed that, as was said297 in Al Masri, "s 196 should, so far as the language permits, be interpreted and applied in a manner consistent with established rules of international law and in a manner which accords with Australia's treaty obligations" (emphasis added). There must, at least, be doubt about whether the mandatory detention of those who do not have permission to enter and remain in Australia contravenes Art 9 of the ICCPR when the detention is in accordance with a procedure established by law (Art 9(1)) and the lawfulness of that detention can readily be tested in a court (Art 9(4)) (as is the lawfulness of the appellant's detention). There would appear to be circularity of reasoning in asserting that the detention is not lawfully authorised by s 196 because, if it were not lawfully authorised by that section, it would breach the obligations undertaken by Australia in Art 9 of the ICCPR that "[n]o one ... be deprived of his liberty except on such grounds and in accordance with such procedure as are established by law". But be this as it may, the root question is whether the language of s 196 will yield the construction asserted. For the reasons given earlier, it will not. It will not because "as soon as reasonably practicable" does not mean "soon" or "for so long as it appears likely to be possible of proximate performance". It is, therefore, not necessary to examine what weight, if any, should be given to the 296 (2003) 126 FCR 54 at 88-92 [138]-[155]. 297 (2003) 126 FCR 54 at 88 [138]. Hayne opinions expressed by the Human Rights Committee established under Art 28 of the ICCPR. Limitation by reference to decisions of other courts? Nor can the transformation be made by resort to decisions of other courts, even final courts, about the construction of legislation framed in different ways. Particular reference was made in argument to R v Governor of Durham Prison; Ex parte Hardial Singh298 and to what was said, in that case, about the power of detention given by the Immigration Act 1971 (UK). Woolf J said299 that: "as the power [of detention] is given in order to enable the machinery of deportation to be carried out, I regard the power of detention as being impliedly limited to a period which is reasonably necessary for that purpose." But two aspects of what was said in Hardial Singh must be noticed. First, what was said concerned a discretionary power to detain, not a mandatory requirement to do so until one of three specified events occurred. Secondly, the construction adopted was described as being reached by a process of implication. It may readily be accepted that to make the implication in that case accorded with applicable principles of statutory construction. But contrary to what was submitted in this and the other two matters heard with it, the resulting implication in that legislation is not itself some principle which finds application beyond the particular legislative context. It is necessary to consider and apply the language of the sections with which we are concerned, not other forms of legislation on the same general subject. That is why no useful assistance is gained by considering Hardial Singh or the other decisions of overseas courts to which we were taken300. Protection of fundamental rights and freedoms There is a relevant general principle to which effect must be given in construing the provisions now in question: legislation is not to be construed as interfering with fundamental rights and freedoms unless the intention to do so is 298 [1984] 1 WLR 704; [1984] 1 All ER 983. 299 [1984] 1 WLR 704 at 706; [1984] 1 All ER 983 at 985. 300 Tan Te Lam v Superintendent of Tai A Chau Detention Centre [1997] AC 97; In the matter of Art 26 of the Constitution and the Illegal Immigrants (Trafficking) Bill 1999 [2000] 2 IR 360; Zadvydas v Davis 533 US 678 (2001); R (Saadi) v Secretary of State for the Home Department [2002] 1 WLR 3131; [2002] 4 All ER 785. Hayne unmistakably clear301. General words will not suffice. Reading the three sections together, however, what is clear is that detention is mandatory and must continue until removal, or deportation, or the grant of a visa. The relevant time limitation introduced to that otherwise temporally unbounded detention is the time limit fixed by s 198 – removal as soon as reasonably practicable after certain events. No other, more stringent, time limit can be implied into the legislation. (That is why the reasoning in Hardial Singh finds no application here.) But more than that, the time limit imposed by the Act cannot be transformed by resort to the general principle identified. The words are, as I have said, intractable. Conditional release? There is one other aspect to notice about the contention that the legislative requirement to detain is limited to detention for so long as there is a real likelihood or prospect of removal of the non-citizen in the reasonably foreseeable future. This limitation of the requirement to detain appears to have been understood as permitting courts to make orders releasing a non-citizen from detention but imposing conditions on the non-citizen such as conditions requiring the non-citizen to report to authorities periodically or to live in a particular place. The final orders made at first instance in Mr Al Masri's case302 took that form. Presumably these conditions have been imposed on an assumption that the requirement to detain and remove might revive at some time in the future. That assumption is, as I said, open to doubt. But there is a more fundamental difficulty. There is no statutory or other basis for making any such order. If the detention is not lawful, it must end. It is not to be replaced with some other set of limitations on the person's freedom. If the detention is unlawful, the only order which a court may make is an order requiring the person to be discharged from detention. It is because the words of the Act will not yield the construction for which the appellant contended that I earlier described the underlying questions in this and the other two matters as being about the application of Ch III of the Constitution. It is that issue to which I now turn. I will deal with the issue by the following steps. First, it will be necessary to say something further about the ambit of the aliens and the immigration powers. Secondly, it will be convenient 301 For example, Coco v The Queen (1994) 179 CLR 427 at 436-438 per Mason CJ, Brennan, Gaudron and McHugh JJ; Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 553 [11] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 302 Al Masri v Minister for Immigration and Multicultural and Indigenous Affairs (2002) 192 ALR 609. Hayne to deal with the decision in Chu Kheng Lim. Thirdly, it will be necessary to examine some questions about punishment. The aliens and the immigration powers A law which permitted or required detention for the purpose of effecting the removal of an unlawful non-citizen from Australia would be a law with respect to aliens and a law with respect to immigration. So much follows from Koon Wing Lau. The provisions now in question, however, are not confined to providing for detention for the purpose of removal. An unlawful non-citizen who is seeking the grant of a visa must be detained. Nonetheless, in that operation, too, the provisions can be seen to be laws with respect to aliens and laws with respect to immigration. That is, in so far as the provisions now in question provide for detention both during the period in which a non-citizen's application for a visa remains unresolved, and thereafter for the purpose of removing the non-citizen from Australia, they are laws with respect to aliens and with respect to immigration. If, after final resolution of a non-citizen's application for a visa, it appears either immediately, or after some time has elapsed, that removal cannot be effected promptly, and it cannot be said when removal might be effected, would the provisions requiring detention no longer be laws with respect to aliens or immigration? Would the connection with either of those subject-matters be so tenuous or insubstantial as to deny that characterisation? The conclusion that a law requiring detention for the purpose of processing a visa application and, if that application is unsuccessful, for the purpose of removing the non-citizen from Australia is a law with respect to aliens and with respect to immigration, does not necessarily entail that a law requiring detention of aliens in other circumstances, or for other purposes, is beyond power. In particular, a law which requires the exclusion from Australia of non-citizens who do not have permission to enter or remain in Australia would fall within those powers. And a law which, in its operation, provided that those non-citizens who do not have permission to enter and remain in Australia, but manage to find their way here, are to be excluded from the Australian community by their removal from Australia as soon as reasonably practicable and, if removal is not practicable, their segregation from the community by detention, would fall within power. The question would then be whether the legislation requiring detention would be at odds with the constitutional requirement that no part of the judicial power of the Commonwealth be conferred otherwise than in accordance with the provisions of Ch III. The intersection between the aliens power and Ch III was considered in Chu Kheng Lim. Hayne Chu Kheng Lim v Minister for Immigration The plaintiffs in Chu Kheng Lim (other than an infant born in Australia) arrived in Australia, by boat, on 27 November 1989 or 31 March 1990. None held a valid entry permit. All were detained upon arrival, and remained in custody thereafter. In 1992, Parliament passed the Migration Amendment Act 1992 (Cth) which, among other things, provided for the detention of the plaintiffs (who were within the class referred to in that Act as "designated persons"). Section 54R of the Migration Act 1958 (as amended by the Migration Amendment Act 1992) provided that "[a] court is not to order the release from custody of a designated person". By majority, the Court held303 s 54R invalid as a direction by the Parliament to the courts as to the manner in which they were to exercise their jurisdiction and thus an impermissible intrusion into judicial power. Sections 54L, 54N and 54P, added to the Migration Act 1958 by the Migration Amendment Act 1992, made provision for the detention of designated persons in terms which were not substantially different from what now appears in ss 189, 196 and 198. (Section 54P required removal of a designated person "as soon as practicable", if the person asked, in writing, to be removed, but I do not think that the addition of the word "reasonably", in the provisions now found in s 198304, assists the appellant in any way.) All members of the Court held305 that s 54L (requiring designated persons to be kept in custody, and to be released if and only if removed from Australia under s 54P or given an entry permit) and s 54N (permitting an officer to detain a designated person without warrant and "take reasonable action to ensure that the person is kept in custody for the purposes of section 54L") were valid in their application to the plaintiffs. That is, all members of the Court agreed that, in their operation in respect of the plaintiffs, the laws did not infringe Ch III. Section 54Q of the Act, also added by the Migration Amendment Act 1992, provided for ss 54L and 54P to cease to apply to designated persons seeking entry permits after the designated person had been in custody for 273 days. (That time did not run during periods where the determination of the application for a permit was delayed for reasons beyond the control of the Department.) This time limit played no, or at least no significant, part in the decision in Chu Kheng Lim. 303 (1992) 176 CLR 1 at 36-37 per Brennan, Deane and Dawson JJ, 53 per Gaudron J. 304 See Migration Reform Act, s 13, inserting what was then s 54ZF into the Act. 305 (1992) 176 CLR 1 at 10 per Mason CJ, 32-34 per Brennan, Deane and Dawson JJ, 49-50 per Toohey J, 55 per Gaudron J, 73-74 per McHugh J. Hayne One of the arguments advanced in Chu Kheng Lim against validity was that, being enacted after the plaintiffs had been taken into custody, the provisions requiring their detention were Bills of Attainder or Bills of Pains and Penalties. Those arguments, which then had only recently been considered by the Court in Polyukhovich v The Commonwealth (War Crimes Act Case)306, were rejected. But two other important elements are to be seen in the reasoning in Chu Kheng Lim. First, Gaudron J, in her separate reasons, pointed out307 that legislation authorising detention in circumstances involving no breach of the criminal law was not "necessarily and inevitably offensive to Ch III". As her Honour later said in Kruger v The Commonwealth308, the categories of cases in which such detention may validly be authorised may not be closed. But whether or not that is so, legislation permitting detention, without judicial intervention, of an alien who has no permission to enter or remain in Australia, can be valid. In their joint reasons, Brennan, Deane and Dawson JJ said309 that ss 54L and 54N: "will be valid laws if the detention which they require and authorize is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered. On the other hand, if the detention which those sections require and authorize is not so limited, the authority which they purportedly confer upon the Executive cannot properly be seen as an incident of the executive powers to exclude, admit and deport an alien. In that event, they will be of a punitive nature and contravene Ch III's insistence that the judicial power of the Commonwealth be vested exclusively in the courts which it designates." In so far as the distinction which was drawn by their Honours depends upon the identification of the purpose of detention, what has been said earlier in these reasons about when that purpose is spent would require the conclusion that the sections now in issue would meet the test of validity which they posit. For the reasons given earlier, the purpose of detention for removal would not be spent until it had become reasonably practicable to remove the non-citizen concerned. The line which was drawn in the joint reasons was a line between detention "reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made 306 (1991) 172 CLR 501. 307 (1992) 176 CLR 1 at 55. 308 (1997) 190 CLR 1 at 110. 309 (1992) 176 CLR 1 at 33. Hayne and considered" and detention not so limited. The former was said not to contravene Ch III; the latter was said to be punitive and contrary to Ch III. Three points may be made about this division. First, to ask whether the law is limited to what is reasonably capable of being seen as necessary for particular purposes may be thought to be a test more apposite to the identification of whether the law is a law with respect to aliens or with respect to immigration. No doubt account must be taken of the fact that the provisions now in question impose the obligation to detain upon the Executive. If the relevant power is identified (as their Honours appear to have identified310 it) as the executive power to deport or exclude, it may readily be accepted that the legislative conferral of authority to detain in custody for the purposes of an executive power identified in that way would be an incident of that power. It is important to notice, however, that the sections now in question (like the provisions under consideration in Chu Kheng Lim) require, rather than authorise, detention. True it is that the requirement is made of the Executive: an "officer" must detain. But the provision is mandatory; the legislature requires that persons of the identified class be detained and kept in detention. No discretion must, or even can, be exercised. No judgment is called for. The only disputable question is whether the person is an unlawful non-citizen. And the courts can readily adjudicate any dispute about that. There is, therefore, nothing about the decision making that must precede detention which bespeaks an exercise of the judicial power. Nor is there any legislative judgment made against a person otherwise entitled to be at liberty in the Australian community. The premise for the debate is that the non-citizen does not have permission to be at liberty in the community. Secondly, for my part, I would not identify the relevant power in quite so confined a manner as is implicit in the joint reasons in Chu Kheng Lim. The relevant heads of power are "aliens" and "immigration". The power with respect to both heads extends to preventing aliens entering or remaining in Australia except by executive permission. But if the heads of power extend so far, they extend to permitting exclusion from the Australian community – by prevention of entry, by removal from Australia, and by segregation from the community by detention in the meantime. That is why I do not consider that the Ch III question which is said now to arise can be answered by asking whether the law in question is "appropriate and adapted" or "reasonably necessary" or "reasonably capable of being seen as necessary" to the purpose of processing and removal of an unlawful non-citizen. Those are questions which it is useful to ask in considering a law's connection 310 (1992) 176 CLR 1 at 32. Hayne with a particular head of power. For the reasons given earlier, the sections now in question are laws with respect to aliens and with respect to immigration. In part that is because a law to exclude a non-citizen from joining the Australian community is a law with respect to those two heads of power. Thirdly, the line which their Honours drew in the joint reasons in Chu Kheng Lim depended upon first concluding311 that, with certain exceptions, "the involuntary detention of a citizen in custody by the State is penal or punitive in character and, under our system of government, exists only as an incident of the exclusively judicial function of adjudging and punishing criminal guilt". Their Honours described312 this as "a constitutional immunity from being imprisoned by Commonwealth authority except pursuant to an order by a court in the exercise of the judicial power of the Commonwealth". As Gaudron J demonstrated in Kruger313, the line which their Honours drew in Chu Kheng Lim is a line which is difficult to identify with any certainty. It is a line which appears to assume that there is only a limited class of cases in which executive detention can be justified. And that assumption is at least open to doubt. But doubtful or not, it is an assumption which turns upon the connection between such detention and the relevant head of power, not upon the identification of detention as a step that can never be taken except in exercise of judicial power. That is why it is important to recognise that once the step is taken, as it was in Chu Kheng Lim, of deciding that mandatory detention of unlawful non-citizens can validly be provided without contravention of Ch III, it is plain that unlawful non-citizens have no general immunity from detention otherwise than by judicial process. At least in many cases it will be right to say that a law authorising detention divorced from any breach of the law is not a law with respect to a head of power and for that reason is invalid. As Gaudron J pointed out in Kruger314, the powers with respect to defence, quarantine and the influx of criminals may stand as exceptions to that observation. But so too do the aliens and immigration powers in so far as they empower the making of laws with respect to the exclusion of persons from Australia and the Australian community. In that, exclusionary, operation the laws do not infringe the limitations on power which follow from the separation of judicial power from the executive and 311 (1992) 176 CLR 1 at 27. 312 (1992) 176 CLR 1 at 28-29. 313 (1997) 190 CLR 1 at 109-110. 314 (1997) 190 CLR 1 at 111. Hayne legislative powers. If the line to be drawn is, as suggested in the joint reasons in Chu Kheng Lim, a line that depends upon connection with the relevant heads of power, these laws in their exclusionary operation have that connection. If the line to be drawn attaches importance to the characterisation of the consequences as punitive, it must be recognised that the consequences which befall an unlawful non-citizen whom the Executive cannot quickly remove from Australia are not inflicted on that person as punishment for any actual or assumed wrongdoing. They are consequences which come about as the result of a combination of circumstances. They flow, in part, from the non-citizen entering or remaining in Australia without permission, in part from the unwillingness of the Executive to give the non-citizen that permission, and in part from the unwillingness of other nations to receive the person into their community or their unwillingness to permit that person to travel across their territory. The first of those considerations may be laid at the feet of the unlawful non-citizen concerned. Indeed, there may be other features of individual cases in which the unwillingness of others to receive the unlawful non-citizen can be seen to flow from the non-citizen's own conduct. These would include not only cases where the non-citizen impedes removal (by destroying identity documents or refusing to co-operate in the obtaining of new documents) but also cases of deportation on "character" grounds in which receiving countries are unwilling to accept persons who have committed criminal offences, or criminal offences of particular kinds, while living in Australia. It is no less important to recognise that the consequences befalling an unlawful non-citizen whom the Executive cannot quickly remove from Australia fall on that person because otherwise he or she will gain the entry to the Australian community which the Executive has decided should not be granted. But at its root, the answer made to the contention that the laws now in question contravene Ch III is that they are not punitive. It is necessary to explain why that is so. "Punishment" and judicial power Because Immigration Detention Centres are places of confinement having many, if not all, of the physical features and administrative arrangements commonly found in prisons, it is easy to equate confinement in such a place with punishment. It is necessary, however, to notice some further matters. Punishment exacted in the exercise of judicial power is punishment for identified and articulated wrongdoing. H L A Hart identified the standard or central case of punishment in terms of five elements315: 315 Hart, Punishment and Responsibility, (1968) at 4-5. Hayne It must involve pain or other consequences normally considered unpleasant. It must be for an offence against legal rules. (iii) It must be of an actual or supposed offender for his offence. It must be intentionally administered by human beings other than the offender. It must be imposed and administered by an authority constituted by a legal system against which the offence is committed." That is not to say, of course, that it may not be appropriate to identify treatment of persons as punitive where those persons are not offenders316. But punishment is not to be inflicted in exercise of the judicial power except upon proof of commission of an offence. Two features of the immigration detention for which the Migration Act now provides, and which have been identified earlier in these reasons, are then important. First, immigration detention is not detention for an offence. There is now no offence of entering or being found within Australia as a prohibited immigrant. Yet the law permitting detention otherwise than for an offence is a law with respect to a head of power. Secondly, where a non-citizen has entered or attempted to enter Australia without a visa, detention of that person excludes that person from the community which he or she sought to enter. Only in the most general sense would it be said that preventing a non-citizen making landfall in Australia is punitive. Segregating those who make landfall, without permission to do so, is not readily seen as bearing a substantially different character. Yet the argument alleging invalidity would suggest that deprivation of freedom will after a time or in some circumstances become punitive. Only if it is said that there is an immunity from detention does it become right to equate detention with punishment that can validly be exacted only in exercise of the judicial power. Once it is accepted, as it was by all members of the Court in Chu Kheng Lim, that there can be detention of unlawful non-citizens for some purposes, the argument from the existence of an immunity must accept that the immunity is not unqualified. The argument must then turn to the identification of those qualifications. That must be done by reference to the purpose of the detention. Neither the bare fact of detention nor the effluxion of some predetermined period of time in detention is said to suffice to engage Ch III. And because the purposes must be gleaned from the content of the heads 316 Hart, Punishment and Responsibility, (1968) at 5. Hayne of power which support the law, it is critical to recognise that those heads of power would support a law directed to excluding a non-citizen from the Australian community, by preventing entry to Australia or, after entry, by segregating that person from the community. It is essential to confront the contention that, because the time at which detention will end cannot be predicted, its indefinite duration (even, so it is said, for the life of the detainee) is or will become punitive. The answer to that is simple but must be made. If that is the result, it comes about because the non-citizen came to or remained in this country without permission. The removal of an unlawful non-citizen from Australia then depends upon the willingness of some other country to receive that person. If the unlawful non-citizen is stateless, as is Mr Al-Kateb, there is no nation state which Australia may ask to receive its citizen. And if Australia is unwilling to extend refuge to those who have no country of nationality to which they may look both for protection and a home, the continued exclusion of such persons from the Australian community in accordance with the regime established by the Migration Act does not impinge upon the separation of powers required by the Constitution. As Judge Learned Hand said in his dissenting opinion in United States v Shaughnessy317: "An alien, who comes to our shores and the ship which bears him, take the chance that he may not be allowed to land. If that chance turns against them, both know, or, if they do not, they are charged with knowledge, that, since the alien cannot land, he must find an asylum elsewhere; or, like the Flying Dutchman, forever sail the seas. When at his urgence we do let him go ashore – pendente lite so to say – we may give him whatever harborage we choose, until he finds shelter elsewhere if he can." (The decision of the Second Circuit Court of Appeals, from which Judge Hand dissented, was reversed by the Supreme Court of the United States318.) To adopt and adapt what Judge Hand said in that case319: "Think what one may of a statute ... when passed by a society which professes to put its faith in [freedom], a court has no warrant for refusing to enforce it. If that society chooses to flinch when its principles are put to the test, courts are not set up to give it derring-do." 317 195 F 2d 964 at 971 (2nd Cir 1952). 318 Shaughnessy v Mezei 345 US 206 (1953). 319 195 F 2d 964 at 971 (2nd Cir 1952). Hayne The appeal should be dismissed. Consistent with the terms on which the matter was removed into this Court, the Commonwealth should pay the appellant's costs in this Court. Callinan CALLINAN J. This appeal raises a question as to the legality of the appellant's detention in immigration detention for an indefinite period but for the purpose of his deportation. These reasons should be read with the reasons in Behrooz v Secretary of the Department of Immigration and Multicultural and Indigenous Affairs320 and Minister for Immigration and Multicultural and Indigenous Facts The appellant claims to be a stateless Palestinian born on 29 July 1976 in Kuwait. His parents are Palestinian and he has lived most of his life in Kuwait except for a brief period of residence in Jordan. He arrived in Australia in mid- December 2000. He said that he did not possess a passport. He was placed in immigration detention pursuant to s 189 of the Migration Act 1958 (Cth) ("the Migration Act"). The appellant made an application for a protection visa to the Department of Immigration and Multicultural and Indigenous Affairs ("the Department") on 6 January 2001. On 22 February 2001, a delegate of the Minister for the Department refused the application. The appellant then applied for a review of the decision of the delegate to the Refugee Review Tribunal ("the Tribunal"). The Tribunal affirmed the decision of the delegate. On 6 June 2001, the appellant applied for judicial review of the Tribunal's decision before the Federal Court. The application was dismissed by the Federal Court on 23 October 2001. He then appealed to the Full Court of the Federal Court. That Court dismissed the appeal on 21 May 2002. On 19 June 2002 the appellant told the Department that he wished to leave Australia and return to Kuwait, or if not there, Gaza. On 30 August 2002, he signed a document addressed to the Minister asking to be removed from Australia as soon as reasonably practicable. His next recourse to litigation was by proceedings in the Federal Court for judicial review of the continuation of his detention on 8 January 2003. This matter was, with others, heard by Selway J who dismissed the application322. An appeal to the Full Court of the Federal Court has been filed but not heard. 320 [2004] HCA 36. 321 [2004] HCA 38. 322 SHDB v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 30. Callinan The appellant's litigious endeavours were pursued in yet another way. He lodged a further application to the Federal Court on 12 February 2003 seeking a declaration that he was being unlawfully detained, consequential relief by way of habeas corpus, an order in the nature of mandamus directing the first and second respondents, officers of the Department, to remove him from Australia, an order in the nature of mandamus directing the second respondent to make certain inquiries, an order in the nature of prohibition against the third respondent, the Minister, to prohibit the appellant's retention in detention, and an order for costs, on the ground that his detention (from which he has now been released) was unlawful. On 3 April 2003 the Federal Court (von Doussa J) dismissed the application after hearing evidence from the second respondent. His Honour was not satisfied that the Department was not taking all reasonable steps to secure the removal of the appellant from Australia, although he found that the appellant's removal from Australia was: "not reasonably practicable at the present time as there is no real likelihood or prospect of removal in the reasonably foreseeable future." His Honour expressly declined to follow the decision of Merkel J in the case of Al Masri v Minister for Immigration and Multicultural and Indigenous Affairs323 which subsequently the Full Court of the Federal Court in Minister for Immigration and Multicultural and Indigenous Affairs v Al Masri324 held to be correct. On 17 April 2003 the appellant applied for an interlocutory order for his release from immigration detention on conditions. He was then released from immigration detention pursuant to an interlocutory order of Mansfield J made on that day. The appellant is living in South Australia and is complying with the conditions to which I have referred. On 23 April 2003, he appealed against the decision of von Doussa J. In July 2003 the appellant was served with a notice under s 40 of the Judiciary Act 1903 (Cth) to remove the appeal against the decision of von Doussa J into this Court. The matter therefore comes before this Court as an appeal to the Full Court of the Federal Court removed under s 40 of the Judiciary Act to be heard 323 (2002) 192 ALR 609. 324 (2003) 126 FCR 54. Callinan and determined, effectively as an appeal to this Court. It was argued at the same time as Behrooz and Al Khafaji. The cases raise the same or some related questions, although this appellant submits that he is in a superior position because he has the advantage of the finding of von Doussa J to which I have referred as to the slightness in fact of his currently foreseeable prospects of removal. The appellant pressed this Court to adopt the approach of the United States Supreme Court in Zadvydas v Davis325 in which the majority, Breyer, Stevens, O'Connor, Souter and Ginsburg JJ, applying the Fifth Amendment326, held the relevant statute there to be subject to a qualification that it did not permit indefinite detention. The conclusion of the majority is stated in this passage327: "While an argument can be made for confining any presumption to 90 days, we doubt that when Congress shortened the removal period to 90 days in 1996 it believed that all reasonably foreseeable removals could be accomplished in that time. We do have reason to believe, however, that Congress previously doubted the constitutionality of detention for more than six months. … Consequently, for the sake of uniform administration in the federal courts, we recognize that period. After this 6-month period, once the alien provides good reason to believe that there is no significant likelihood of removal in the reasonably foreseeable future, the Government must respond with evidence sufficient to rebut that showing. And for detention to remain reasonable, as the period of prior post-removal confinement grows, what counts as 'reasonably foreseeable future' conversely would have to shrink. This 6-month presumption, of course, does not mean that every alien not removed must be released after six months. To the contrary, an alien may be held in confinement until it has been determined that there is no significant likelihood of removal in the reasonably foreseeable future." the 326 "No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation." 327 533 US 678 at 701 (2001). Callinan Not only because of the absence of the complication of a constitutional provision in Australia such as the Fifth Amendment, but also because, in my respectful opinion, they were both more orthodox expressions of constitutional principle and practical reality, I would prefer the opinions of the minority Justices. Scalia J (with whom Thomas J joined) said this328: "Like a criminal alien under final order of removal, an inadmissible alien at the border has no right to be in the United States. … In Shaughnessy v United States ex rel Mezei329, we upheld potentially indefinite detention of such an inadmissible alien whom the Government was unable to return anywhere else. We said that 'we [did] not think that respondent's continued exclusion deprives him of any statutory or constitutional right.'330 While four Members of the Court thought that Mezei deserved greater procedural protections (the Attorney General had refused to divulge any information as to why Mezei was being detained331), no Justice asserted that Mezei had a substantive constitutional right to release into this country. And Justice Jackson's dissent, joined by Justice Frankfurter, affirmatively asserted the opposite, with no contradiction from the Court: 'Due process does not invest any alien with a right to enter the United States, nor confer on those admitted the right to remain against the national will. Nothing in the Constitution requires admission or sufferance of aliens hostile to our scheme of government.'332 Insofar as a claimed legal right to release into this country is concerned, an alien under final order of removal stands on an equal footing with an inadmissible alien at the threshold of entry: He has no such right. We are offered no justification why an alien under a valid and final order of removal – which has totally extinguished whatever right to presence in this country he possessed – has any greater due process right to be released into the country than an alien at the border seeking entry. Congress undoubtedly thought that both groups of aliens – inadmissible aliens at the threshold and criminal aliens under final order of removal – could be constitutionally detained on the same terms, since it provided the 328 533 US 678 at 703-705 (2001). 330 345 US 206 at 215 (1953). 331 345 US 206 at 209 (1953). 332 345 US 206 at 222-223 (1953) (emphasis added by Scalia J). Callinan authority to detain both groups in the very same statutory provision ... Because I believe Mezei controls these cases, and, like the Court, I also see no reason to reconsider Mezei, I find no constitutional impediment to the discretion Congress gave to the Attorney General. Justice Kennedy's dissent explains the clarity of the detention provision, and I see no obstacle to following the statute's plain meaning." (original emphasis) Kennedy J, with whom Rehnquist CJ joined, and with whom Scalia J and Thomas J joined as to the second and third of the paragraphs reproduced below, said this333: "The Court says its duty is to avoid a constitutional question. It deems the duty performed by interpreting a statute in obvious disregard of congressional intent; curing the resulting gap by writing a statutory amendment of its own; committing its own grave constitutional error by arrogating to the Judicial Branch the power to summon high officers of the Executive to assess their progress in conducting some of the Nation's most sensitive negotiations with foreign powers; and then likely releasing into our general population at least hundreds of removable or inadmissible aliens who have been found by fair procedures to be flight risks, dangers to the community, or both. Far from avoiding a constitutional question, the Court's ruling causes systemic dislocation in the balance of powers, thus raising serious constitutional concerns not just for the cases at hand but for the Court's own view of its proper authority. Any supposed respect the Court seeks in not reaching the constitutional question is outweighed by the intrusive and erroneous exercise of its own powers. In the guise of judicial restraint the Court ought not to intrude upon the other branches. The constitutional question the statute presents, it must be acknowledged, may be a significant one in some later case; but it ought not to drive us to an incorrect interpretation of the statute. The Court having reached the wrong result for the wrong reason, this respectful dissent is required. The 6-month period invented by the Court, even when modified by its sliding standard of reasonableness for certain repatriation negotiations … makes the statutory purpose to protect the community ineffective. The risk to the community exists whether or not the repatriation negotiations have some end in sight; in fact, when the negotiations end, the risk may be greater. The authority to detain beyond the removal period is to protect the community, not to negotiate the aliens' return. The risk to the community survives repatriation negotiations. To a more limited, but still 333 533 US 678 at 705-712 (2001). Callinan significant, extent, so does the concern with flight. It is a fact of international diplomacy that governments and their policies change; and if repatriation efforts can be revived, the Attorney General has an interest in ensuring the alien can report so the removal process can begin again. The majority's interpretation, moreover, defeats the very repatriation goal in which it professes such interest. The Court rushes to substitute a judicial judgment for the Executive's discretion and authority. As the Government represents to us, judicial orders requiring release of removable aliens, even on a temporary basis, have the potential to undermine the obvious necessity that the Nation speak with one voice on immigration and foreign affairs matters. … The result of the Court's rule is that, by refusing to accept repatriation of their own nationals, other countries can effect the release of these individuals back into the American community. … If their own nationals are now at large in the United States, the nation of origin may ignore or disclaim responsibility to accept their return. … The interference with sensitive foreign relations becomes even more acute where hostility or tension characterizes the relationship, for other countries can use the fact of judicially mandated release to their strategic advantage, refusing the return of their nationals to force dangerous aliens upon us. One of the more alarming aspects of the Court's new venture into foreign affairs management is the suggestion that the district court can expand or contract the reasonable period of detention based on its own assessment of the course of negotiations with foreign powers. The Court says it will allow the Executive to perform its duties on its own for six months; after that, foreign relations go into judicially supervised receivership." It follows that I would reject the submission of the appellant that this Court should regard the period of 273 days referred to in s 182 of the Migration Act and discussed in Chu Kheng Lim v Minister for Immigration334, or any other arbitrarily fixed period, in the same way as the majority in the Supreme Court of the United States did six months, in Zadvydas, as the outer limit of any reasonable period of detention for the purposes of deportation. It was not, and could not be contested that detention for purposes other than punitive ones has been traditionally constitutionally acceptable. Lim335 itself acknowledges that. Examples are arrest and detention pending trial, detention of the mentally ill or infectiously diseased, and for the welfare and protection of 334 (1992) 176 CLR 1. 335 (1992) 176 CLR 1 at 25-26. Callinan persons endangered for various reasons. Here the appellant accepts that the power to detain exists in respect of him but contends that it cannot be exercised for too long, indefinitely, or indeed unless the respondents can demonstrate that within some relatively brief period, a country which will receive him has been, or will be found. Whatever may be said about its limits, the existence of the power to detain was not and could not be denied336. Koon Wing Lau v Calwell337 was also referred to by the appellant in argument, especially the passage in which Dixon J, after referring to "purpose [of detention]" said that "unless within a reasonable time [the detainee] is placed on board a vessel he would be entitled to his discharge on habeas."338 There, his Honour was not discussing the ambit of the constitutional power with respect to aliens but was construing the language of the enactment as it was at that time. The statement was also made in an entirely different situation, in which immediate deportation was feasible. I do not need to decide, but would not necessarily accept that detention for the purpose of deporting an alien is the only purpose which may be effected under the aliens power. It may be the case that detention for the purpose of preventing aliens from entering the general community, working, or otherwise enjoying the benefits that Australian citizens enjoy is constitutionally acceptable. If it were otherwise, aliens having exhausted their rights to seek and obtain protection as non-citizens would be able to become de facto citizens. It is also important to keep in mind the related fact that the appellant, having been shown not to qualify as a refugee, has no particular rights under the United Nations Convention relating to the Status of Refugees except perhaps under Art 32(1)339, and only then to the extent if any that s 36 of the Act does not provide otherwise, and the relevant person is lawfully present. Another practical consideration is that by their manner of entry340, repetitive unsuccessful applications and litigation founded on unsubstantiated claims, or, if and when it occurs, escape from immigration detention, some aliens may attract so much notoriety that other countries will hesitate or refuse to receive them. In those ways they may 336 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1. See also Kruger v The Commonwealth (1997) 190 CLR 1 at 162 per Gummow J. 337 (1949) 80 CLR 533. 338 (1949) 80 CLR 533 at 581. 339 "The Contracting States shall not expel a refugee lawfully in their territory save on grounds of national security or public order." 340 For example, by using false papers or making false statements, an offence under s 234 of the Migration Act. Callinan personally create the conditions compelling their detention for prolonged periods. And, so far as conditions are concerned, aliens entering this country should be taken to know and accept, to adopt the language of Griffith CJ in Robtelmes v Brenan341, "as a term of … admission to [it]" that restraint to the extent necessary to enable deportation to be effected as and when it can be, may be imposed upon them if they are not qualified for refugee status. Sections 196(1) and 198 of the Act in particular are not expressed in unqualified language. The latter requires the relevant official to remove as soon as reasonably practicable. It does not follow that the presence of Ch III in the Constitution produces the result that a court must or may examine in every case to which those sections apply, what the chances are of the removal of the alien concerned, and if they are not likely to be realized, and realized within some arbitrary period effectively legislatively fixed by the court, the alien cannot be detained. Such a conclusion is not dictated by Lim. Even if the purpose of deportation appears unlikely to be achievable within a foreseeable period it does not mean that the purpose of detention is not still being sought to be, and cannot be, implemented at some time. Who knows, as Kennedy J in Zadvydas points out342, what the outcome of sensitive negotiations between governments taking place from time to time may be. So too, conditions and attitudes may change rapidly or unexpectedly in those countries which an alien has left or which may formerly have rejected him or her. Detention of aliens, certainly for the purpose of deportation, clearly falls within the exception traditionally and rightly recognised as being detention otherwise than of a punitive kind343. It would only be if the respondents formally and unequivocally abandoned that purpose that the detention could be regarded as being no longer for that purpose. It may be that detention for some other purpose under immigration power would be constitutionally possible, but no question of that arises here344. It may be that the aliens or indeed the 341 (1906) 4 CLR 395 at 406-407. 342 533 US 678 at 708-709 (2001). 343 cf Kruger v The Commonwealth (1997) 190 CLR 1 at 110-111 per Gaudron J. 344 In the second reading speech for the Migration Amendment (Duration of Detention) Bill 2003 the responsible Minister referred to the serious risk to the country of some aliens within it. He said: "Such orders mean that a person must be released into the community until such time as the court finally determines their application. The court's final determination of the case can take anywhere between several weeks and several months. Where the person is subsequently unsuccessful, that (Footnote continues on next page) Callinan legislation for detention to deter entry by persons without any valid claims to entry either as a punishment345 or a deterrent would be permissible, bearing in mind that a penalty imposed as a deterrent or as a disciplinary measure is not always to be regarded as punishment imposable only by a court346. Deterrence may be an end in itself unrelated to a criminal sanction or a punishment. Deterrence can, for example, be an end of the law of tort. Another way of viewing the provisions for detention may simply be as "[prescriptions of] the conditions upon which persons may remain ... within [the] Commonwealth" as an aspect of the "power to regulate immigration by Statute."347 On their proper construction the sections under consideration do not give rise to a kind of implied temporal limitation or qualification, or provide a licence to rewrite the statutory language. What has already been said about the difficulties necessarily attendant upon unlawful entry, changing attitudes in other countries, and international negotiations, shows that accurate predictions as to the period of immigration detention are simply not possible. The fact that the time cannot be stated in days or months does not mean that the word "until" in s 196(1) should be read as extending, for example, to "until removal or the expiry of 12 months, whichever first occurs", and nor does it mean that those words should be substituted for "as soon as reasonably practicable". I return to Koon Wing Lau and Lim. In the former the statutory language did not contain the words "reasonably practicable", an expression which is directed to, and indicates that the legislature has had regard to contemporary realities, that time, perhaps much, and indefinable time may pass between what is person must be relocated, redetained and arrangements then made for their removal from Australia. This is a time consuming and costly process and can further delay removal from Australia. I understand that there have now been some 20 persons released from immigration detention on the basis of interlocutory orders. In the case of more than half of these persons removal action had been commenced, as they are of significant character concern, and the government believes their presence is a serious risk to the Australian community." Australia, House of Representatives, Parliamentary Debates (Hansard), 18 June 345 See the discussion by Hayne J of earlier punitive provisions relating to unlawful entrants at [201]-[202]. 346 cf R v White; Ex parte Byrnes (1963) 109 CLR 665 at 670-671. 347 See Robtelmes v Brenan (1906) 4 CLR 395 at 415 per Barton J. Callinan intended, and what in practice may happen. That is sufficient to distinguish this case from Koon Wing Lau. In their joint judgment in Lim, Brennan, Deane and Dawson JJ acknowledged the breadth of the aliens power as well as the lawfulness of detention for purposes other than punitive ones348. In particular it was accepted there that the Parliament might make laws reasonably capable of being seen as necessary for the purposes of deportation349. The yardstick, and with respect rightly so, was "purpose", the existence, that is the continuing existence of the relevant purpose of deportation. Nothing that was said in relation to the intrusion upon judicial power by the enactment of another provision directed to a different end alters or diminishes that. The finding that the prospects of this appellant's removal are currently slight does not in my opinion place this appellant in any relevantly special position. Von Doussa J did not indicate, indeed as a practical matter it would probably not be possible for him to do so, what could or should be regarded as a reasonable period in respect of which predictions might safely be made. The fact that deportation may not be imminent, or even that no current prediction as to a date and place of it can be made, does not mean that the purpose of the detention, deportation, has been or should be regarded as abandoned. The sensitivity of international relations, the unsettled political situation in many countries, and the role and capacity of the United Nations, all contribute to the inevitable uncertainties attaching to the identification of national refuges for people who have come to this country unlawfully and who have been shown to be people to whom protection obligations are not owed. I would not import into ss 189 and 198 of the Migration Act an implication that the obligation of an officer to detain an illegal entrant ceases, or may cease, and is not to be enforced simply because it is proving, and may well prove, for some indefinite time, to be difficult to find a country that will receive him. The words "as soon as reasonably practicable" in s 198 of the Migration Act are intended to ensure that all reasonable means are employed to remove an illegal entrant, and not to define a period or event beyond which his detention should be deemed to be unlawful. The appellant submits that Parliament could not have intended to legislate for indeterminate detention, and argues that support for this proposition is to be found in cases in the United Kingdom such as R v Governor of Durham Prison; Ex parte Hardial Singh350. In that case the Court held that there was an implied 348 (1992) 176 CLR 1 at 25-26, 28-29, 33. 349 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 33. 350 [1984] 1 WLR 704; [1984] 1 All ER 983. Callinan limitation on a statutory provision allowing detention of aliens for the purposes of removal. If it was not possible to remove the person within a reasonable period, continued detention was not authorised by the legislation. The approach in Hardial Singh was affirmed by the House of Lords in R (Saadi) v Secretary of State for the Home Department351. The appellant also cited the decision of the Privy Council in Tan Te Lam v Superintendent of Tai A Chau Detention Centre352 in which it was held that a statutory power to detain aliens pending removal from Hong Kong was subject to an implied limitation that if removal were not possible within a reasonable time, continuing detention would be unlawful. To the extent that these cases might have application in the different Australian context of an explicit written constitution I would not, with respect, be inclined to adopt them here. The appellant also submits that the intent of Parliament should be interpreted by this Court in a manner that is consistent with Australia's "international obligations": that is, Parliament should be assumed to have intended that any provisions for detention in the Migration Act comply with Art 9 of the International Covenant on Civil and Political Rights which admonishes against "arbitrary detention". These submissions cannot be accepted. The statutory language is clear and unambiguous. It leaves no room for any implications of the kind found by the House of Lords and the Privy Council. It requires the detention of aliens until such time as they are granted a visa or removed from Australia. There is certainly no basis, in my view, for an implication to the effect that the ability to detain aliens in accordance with the Migration Act is limited to detention for a "reasonable" period. Nor is a presumption, assuming it should be made, against legislation that is contrary to an international obligation, sufficient to displace the clear and unambiguous words of Parliament. It is a matter for the Australian Parliament to determine the basis on which illegal entrants are to be detained. So long as the purpose of detention has not been abandoned, a statutory purpose it may be observed that is clearly within a constitutional head of power, it is the obligation of the courts to ensure that any detention for that purpose is neither obstructed nor frustrated. The test is not whether the Minister harbours a hope, but whether she continues to have the intention of removing the appellant from the country. General experience may well be, it is not clear whether it is so from the evidence here, that a very great deal of time can elapse before, not only stateless persons, but also others can be removed to another country. But that does not mean that a 351 [2002] 1 WLR 3131; [2002] 4 All ER 785. Callinan court is entitled to hold that a person who has no right to enter and reside in the community must be released into it. Nor is it open to a court to hold, in respect of a matter of this kind, that because removal is currently unachievable, it should be treated for all practical purposes as permanently unachievable. The decision and reasoning of Merkel J in Al Masri should be rejected. Similarly, the reasoning in the other cases in which Al Masri has been adopted or affirmed by the Federal Court is also flawed and should be rejected353. The fact that the appellant is stateless does not alter the position. A consequence of it is, self-evidently, that it will be difficult to find a country to which he can be removed, but that does not mean that attempts, or an intention to do so may be regarded as abandoned. This country has no greater obligation to receive stateless persons who cannot establish their entitlement to the status of refugee, than others who are not stateless. Under the Migration Act there are not two classes of illegal entrants: those who can be readily and promptly removed from this country because another state is willing to receive them, and others, who, on account of statelessness or otherwise, may not so readily be found another country of residence. Whether statelessness calls for a different treatment, as it may well do for practical and humanitarian reasons, is a matter for the legislature and not for the courts. Nor should the appellant be accorded any special advantages because he has managed illegally to penetrate the borders of this country over those who have sought to, but have been stopped before they could do so. The appeal should be dismissed. In accordance with the order of this Court on the application to remove the proceedings pursuant to s 40 of the Judiciary Act, the respondents should pay the costs of the appellant in this Court. 353 See Minister for Immigration and Multicultural and Indigenous Affairs v VFAD (2002) 125 FCR 249. 303 HEYDON J. Subject to reserving any decision about whether s 196 should be interpreted in a manner consistent with treaties to which Australia is a party but which have not been incorporated into Australian law by statutory enactment, I agree with the reasons stated by Hayne J for his conclusion that the continued detention of the appellant is not unlawful and for the orders he proposes. It is therefore not necessary to decide whether, if the appellant's continued detention were unlawful, any conditions could be imposed on his release.
HIGH COURT OF AUSTRALIA CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION & ANOR APPELLANTS AND PERSONNEL CONTRACTING PTY LTD RESPONDENT Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1 Date of Hearing: 31 August 2021 Date of Judgment: 9 February 2022 ORDER Appeal allowed with costs. Set aside the order of the Full Court of the Federal Court of Australia made on 17 July 2020 and, in its place, order that: the appeal be allowed; the order of the Federal Court of Australia made on 6 November 2019 be set aside; it be declared and ordered that, between 27 July 2016 and 6 November 2016 and 14 March 2017 and 30 June 2017, the second appellant was employed by the respondent; and the matter be remitted to the primary judge for determination according to law. On appeal from the Federal Court of Australia Representation B W Walker QC with M A Irving QC and T J Dixon for the appellants (instructed by Construction, Forestry, Maritime, Mining and Energy Union) J B Blackburn SC with M L Felman for the respondent (instructed by Hotchkin Hanly Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd Industrial law (Cth) – Nature of employment relationship – Employee or independent contractor – Where second appellant backpacker with limited work experience sought construction work from respondent – Where respondent in business of labour-hire – Where respondent and second appellant entered written contract describing second appellant as "self-employed contractor" – Where respondent assigned second appellant to work on construction site run by respondent's client – Where second appellant agreed with respondent to co-operate with respondent and client in all respects in supply of his labour to client – Where no contract between second appellant and client – Where respondent paid second appellant for work performed for client – Whether second appellant employee of respondent. "control", Words and phrases – "business of supplying labour", "contract of service", "contractor", "label", "labour-hire", "legal rights and obligations", "multifactorial approach", "own business", "own business/employer's business dichotomy", "performance of work", "serving in the business of the employer", "subsequent conduct", "totality of the relationship", "triangular labour-hire arrangement", "written contract". "independent "employee", contractor", Fair Work Act 2009 (Cth), ss 13, 14. KIEFEL CJ, KEANE AND EDELMAN JJ. The respondent (trading as "Construct") is a labour-hire company based in Perth, which engages workers to supply their labour to building clients. Construct's major client was Hanssen Pty Ltd ("Hanssen"), a builder of high-rise residential apartments and offices1. In 2016, Mr McCourt was a 22-year-old British backpacker who had travelled to Australia on a working holiday visa. Seeking a source of income, and with limited prior work experience as a part-time brick-layer and in hospitality, Mr McCourt obtained a "white card", which enabled him to work on construction sites. He contacted Construct and attended an interview on 25 July 2016. At the interview, Mr McCourt indicated that he was prepared to do any construction work, and was available to start work immediately. He confirmed to the Construct representative that he owned a hard hat, steel-capped boots and hi-vis clothing, having purchased them for less than $100 in the hope of finding construction work. He was offered a role and presented with paperwork to sign. Among the documents he signed was an Administrative Services Agreement ("ASA"), which described Mr McCourt as a "self-employed contractor"2. The day after Mr McCourt's interview, Construct contacted him to offer him work at Hanssen's Concerto project site beginning the following day. When he arrived on site, Mr McCourt was given the Hanssen Site Safety Induction Form and Hanssen Site Rules. He was told that he would be supervised primarily by a leading hand employed by Hanssen, Ms O'Grady3. Mr McCourt did not sign a contract with Hanssen. Mr McCourt worked at the Concerto site between 27 July and 6 November 2016. While on site, Mr McCourt worked under the supervision and direction of Hanssen supervisors, including Ms O'Grady. Although Construct staff sometimes conducted site visits, they never directed Mr McCourt in the performance of work, 1 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 645 [46]-[47]. 2 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 644 [42], 649 [55]. 3 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 649 [57]-[58], 650 [60]. Edelman except to draw his attention to workplace health and safety issues in the manner of his work4. Mr McCourt's primary tasks were described as follows5: "For a period of months, he engages in basic labouring tasks; he takes out the bins, cleans workspaces and moves materials. He is not an entrepreneur nor a skilled artisan; he is paid by the hour, and when at work, is told what to do and how to do it." On 6 November 2016, Mr McCourt finished work at the Concerto site and left Perth. He returned the following March and, on 14 March 2017, recommenced work on the Concerto project. On 26 June 2017, he began working on Hanssen's Aire project, performing work that was substantially identical to the Concerto project. On 30 June 2017, Mr McCourt was told that he was not to continue working at the Aire project. Thereafter, Mr McCourt did not receive any work from Construct6. Mr McCourt and the Construction, Forestry, Maritime, Mining and Energy Union commenced proceedings against Construct seeking orders for compensation and penalties pursuant to ss 545, 546 and 547 of the Fair Work Act 2009 (Cth) ("the Act"). The claims were made on the basis that Construct had not paid Mr McCourt according to his entitlement, as an employee of Construct, to payment in accordance with the Building and Construction General On-site Award 2010. Similar orders were sought against Hanssen, on the basis that it was liable as an accessory for Construct's alleged breaches. The crucial question in the proceedings was whether Mr McCourt was an employee of Construct for the purposes of the Act. The primary judge (O'Callaghan J), applying a multifactorial approach to that question, treated the description of Mr McCourt in the ASA as "the Contractor" as decisive of that 4 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 649-650 [54], [59]-[60]. 5 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 644 [42]. 6 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 649-650 [59]. Edelman question in circumstances where the other factors were "reasonably evenly balanced"7. On that basis, the proceedings were dismissed8. The primary judge's conclusion was upheld on appeal by the Full Court of the Federal Court of Australia9. The members of the Full Court (Allsop CJ, Jagot and Lee JJ) also approached the question by a multifactorial analysis, but made it clear10 that had it not been for the decision of the Western Australian Industrial Appeal Court in Personnel Contracting Pty Ltd v Construction, Forestry, Mining and Energy Union of Workers11 ("Personnel (No 1)") – which involved "essentially the same dispute between the same parties"12 – their Honours would have held that Mr McCourt was an employee of Construct. Lee J, with whom Allsop CJ and Jagot J agreed, described the notion that Mr McCourt was an independent contractor as "somewhat less than intuitively sound"13. But because their Honours were not able to conclude that Personnel (No 1) was plainly wrong14, they held that Mr McCourt had been engaged by Construct as an independent contractor and, therefore, was not an employee. 7 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [176]-[178]. 8 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806. 9 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631. 10 Construction, Forestry, Maritime, Mining and Energy Union v Personnel (2020) 279 FCR 631 Contracting Pty Ltd 12 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 666 [121]. 13 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 682 [185]. See also 641-642 [28]-[29]. 14 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 644 [40], 682 [185]. Edelman For the reasons that follow, Mr McCourt was employed by Construct, and so the appeal to this Court must be allowed. The contractual arrangements between the parties The relationship between Mr McCourt and Construct was governed by the ASA. The relationship between Construct and Hanssen was governed by a Labour Hire Agreement ("LHA"). There was no contractual arrangement between Mr McCourt and Hanssen. The LHA The LHA described Construct's role as "an administrative services agency, liaising between the client and self-employed contractors for the provision of labour by self-employed contractors to the client"15. Construct's workers were referred to Hanssen on a "daily hire basis" for which Hanssen agreed to pay Construct at an hourly rate, negotiated between Hanssen and Construct, and invoiced weekly16. Construct was responsible for the suitability of its workers, and agreed to replace a worker at no charge if notified of the worker's unsuitability within four hours on the first day of an assignment17. Hanssen agreed to comply with all workplace health and safety laws applicable to Construct's workers18. It is unnecessary, and indeed inappropriate, to refer to the terms of the LHA in any greater detail because Mr McCourt was not a party to the LHA. His contract with Construct was not affected by the terms of the LHA. Clause 4 of the LHA, however, is significant because its import was reflected in the ASA. Clause 4 was entitled "Direction", and provided as follows: "[Construct's] contractors are under the client's direction and supervision from the time they report to the client and for the duration of each day on the assignment." The bargain between Construct and Hanssen dovetailed in this respect with the bargain between Construct and Mr McCourt in that the latter arrangement facilitated Construct's performance of the former. As will be seen, under the ASA, 15 cl 1 of the LHA. 16 cll 3, 9 of the LHA. 17 cl 1 of the LHA. 18 cl 2 of the LHA. Edelman Construct had the right to subject Mr McCourt to the direction of Hanssen in respect of what work he was to do and how he was to do it. The ASA and related documents Given its central importance to the characterisation of Mr McCourt's relationship with Construct, it is desirable to set out the terms of the ASA in full: "RECITAL Construct is an administrative services agency operating essentially within the building industry, liaising between builders (or their contractors) (both described as 'builders') and self-employed contractors for the provision of labour by self-employed contractors to builders and supplying to the self-employed contractors financial administrative services. The Contractor requires Construct to keep the Contractor informed of opportunities for the Contractor to provide builders with labour services and to provide the Contractor with financial administrative support to enable the Contractor to concentrate on maximising the supply of quality labour to builders. IT IS AGREED Construct's Responsibilities Construct shall: (a) Use reasonable endeavours to keep informed of opportunities in the building industry for the Contractor to supply labour to builders identified by Construct; Inform the Contractor when, and on what basis, an opportunity arises for the Contractor to supply labour to a builder; Liaise between builders and the Contractor regarding the means by which the Contractor shall supply labour to such builders, including the duration that the builder requires such labour, the place at which labour is to be supplied, the daily hours of work during which labour is to be supplied and any other terms and conditions upon which labour is to be supplied by the Contractor to the builder; Subject to performance by the Contractor of his or its obligations under this Agreement, underwrite payment to the Contractor, within Edelman 7 days of receipt of an invoice from the Contractor, of all payment rates payable by the builder in respect of the supply of labour to the builder by the Contractor, including payment rates negotiated by the Contractor directly with the builder; administrative Complete and undertake necessary forms correspondence with Government authorities as may be required under any law of Western Australia relating to labour supplied to builders under this agreement, other than the completion by the Contractor of his taxation returns, including any instalment activity statement or business activity statements. Construct's Rights Construct shall be entitled to: (a) Negotiate with any builder a payment rate for the supply by the Contractor of labour to the builder, provided that the Contractor shall be at liberty to negotiate with the builder an increase in the payment rate and any other terms and conditions upon which labour is to be supplied by the Contractor to the builder, subject to the Contractor properly performing his obligations under this Agreement; (b) Negotiate with the builder the basis upon which Construct is to be remunerated on a commission basis as a percentage of the agreed payment rate for the supply of services by the Contractor to the builder; (c) Negotiate with the builder for remuneration in respect of any increase in the payment rate negotiated directly by the Contractor with the builder; (d) Withhold from the Contractor payment of any monies reasonably required by Construct to compensate it for any claim made against Construct by the builder in respect of the supply of labour by the Contractor to the builder. The Contractor's Warranties The Contractor warrants that: (a) He has provided Construct with true and accurate information regarding his work experience and capability for the supply of labour to builders; Edelman (b) He is self-employed; (c) He does not require Construct to guarantee the Contractor work of any type or of any duration; That he shall keep Construct fully informed of the outcome of negotiations with the builder by the Contractor in order to ensure that Construct is promptly and accurately informed of any higher rate of payment agreed by the builder and the value of any other terms and conditions agreed with the builder by the Contractor; Construct shall not be liable to pay the Contractor any amounts in respect of annual leave, sick leave, long service leave or any other statutory entitlement required in an employer-employee relationship. The Contractor's Obligations The Contractor shall: Co-operate in all respects with Construct and the builder in the supply of labour to the Builder; Ensure accurate records are maintained as to the amount of labour supplied to the builder by the Contractor; (c) Attend at any building site as agreed with the Builder at the time required by the Builder, and shall supply labour to the Builder (subject to notification under clause 5(c)) for the duration required by the Builder in a safe, competent and diligent manner; Indemnify Construct against any breach by the Contractor of sub-paragraph 4(c) hereof; Supply such tools of trade and equipment, for safety or other reasons, as may be required by the builder, in respect of which the Contractor is solely responsible; Possess all statutory certification relevant to the supply of labour, and shall ensure that these certificates be both current and valid in Western Australia; In the event that the Contractor reasonably considers that his safety is endangered by conditions on the building site, promptly report the unsafe conditions to Worksafe if unable to have the unsafe conditions rectified by the builder promptly; Edelman (h) Not represent himself as being an employee of Construct at any time or otherwise represent himself as authorised to act on behalf of Construct other than strictly under the terms of this Agreement. The Contractor's Rights The Contractor is entitled to: Receive payment from Construct of all amounts negotiated with the builder by Construct and the Contractor within seven (7) days of the issue by the Contractor of a valid invoice delivered to Construct by the Contractor for the supply of labour to the builder by the Contractor; Refuse to accept any offer of work from a builder; (c) Notify the builder and Construct on 4 hours notice that he is no longer available for the supply of labour under the terms of this Agreement." A number of observations may be made here about the terms of the ASA. First, Recital A might be said to suggest that Construct was engaged merely in seeking out business opportunities for Mr McCourt. But the operative terms of the ASA and the factual matrix in which it was made make it clear that Construct's business was more substantial than introducing labourers to builders. Under cl 2(a), Construct was empowered to fix Mr McCourt's remuneration, subject to the possibility that he might negotiate extra benefits from Hanssen. And under cll 1(d) and 5(a), Construct assumed the obligation to pay Mr McCourt for his work with Hanssen. Once Mr McCourt accepted an offer of work, his core obligation pursuant to cl 4(a) was to "[c]o-operate in all respects with Construct and [Hanssen] in the supply of labour to [Hanssen]". This included, pursuant to cl 4(c), the obligations to attend Hanssen's worksite at the nominated time, and to supply labour to Hanssen "for the duration required by [Hanssen] in a safe, competent and diligent manner". Similar obligations were contained in Construct's Contractor Safety Induction Manual signed by Mr McCourt. By that document, which was found by Edelman the Full Court to have contractual force between Mr McCourt and Construct19, Mr McCourt agreed, inter alia: to follow all worksite safety rules and procedures given by Construct's "host client", and to report any safety hazards, incidents or injuries to the site supervisor or administrator and to Construct20. Before both the primary judge and the Full Court, the facts surrounding the work practices of Construct and Hanssen, and the specific arrangements vis-à-vis Mr McCourt, were canvassed at length. Given there was no challenge to the validity of the ASA nor any suggestion that the contract had been varied by conduct, a review of how the parties went about discharging their obligations to each other after execution of the ASA was unwarranted. It is unnecessary and inappropriate to replicate that fact-finding exercise in this Court. To the extent that this discussion of post-contractual performance had a bearing upon the reasoning of the courts below, it is sufficiently apparent from the reasons given for their decisions. The primary judge The primary judge applied a "multifactorial approach" to the question whether Mr McCourt was an employee or an independent contractor, in which both the terms of the ASA and the work practices imposed by each of Construct and Hanssen were relevant, though neither was dispositive21. The primary judge regarded the circumstances of control as tending against the conclusion that Mr McCourt was an employee of Construct. His Honour considered that the entity that had control over the performance of work by Mr McCourt was Hanssen, not Construct22. The primary judge rejected an argument that Construct had either control, or a right of control, over Mr McCourt on the basis that his obedience of Hanssen's directions derived from his contractual promises to Construct under the ASA. In the primary judge's view, Mr McCourt's 19 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 673 [151], 676 [160]. 20 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [14]. 21 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [115], [119]. 22 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [138], [140], [147]. Edelman generally expressed obligations to cooperate with Construct's client, and to turn up for work at a time and place nominated by the client, were insufficient to vest in Construct "control" over Mr McCourt in the relevant sense23. The primary judge considered that Mr McCourt was an "unskilled labourer" and that it was "obvious that Mr McCourt did not operate a business on his own account"24. His Honour rejected an argument that the question whether Mr McCourt was conducting his own business ought to be determinative of his employment status. His Honour regarded that argument as inconsistent with the nature of a multifactorial assessment25. His Honour considered the circumstance that Mr McCourt was not operating a business on his own account was just one factor in the analysis, and that it supported a conclusion that he was an employee. that The primary judge considered that the circumstance that Mr McCourt was not integrated into the business of Construct tended weakly against the conclusion that he was an employee26. On the other hand, the circumstance that Mr McCourt provided only limited tools and equipment of his own was an indicator in favour of the conclusion that he was an employee27. His Honour considered that the absence of leave and employee entitlements was inconclusive, since that circumstance merely reflected Construct's understanding of the character of its 23 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [135]-[141]. 24 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [156]. 25 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [153], [157]. 26 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [164]. 27 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [163]. 28 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [167]-[169]. Edelman Ultimately, the primary judge concluded that because relevant factors pointed "in opposite directions"29 and were "reasonably evenly balanced"30, it was "important to pay close regard to the way in which the parties have characterised their relationship"31. His Honour held that in the present circumstances, where there was a written agreement between the parties and there was no suggestion of sham or pretence32: "it seems to me that there is no sufficient reason not to find that the parties' agreement that Mr McCourt was self-employed means, and was intended to mean, what it says." In his Honour's view, the various terms of the ASA wherein Mr McCourt warranted that he was a "self-employed contractor"33 and that he would not represent himself as being an employee of Construct34 were clear statements of intent that the relationship between Construct and Mr McCourt was not to be one of employment, but one of principal and independent contractor. On that basis, his Honour concluded that Mr McCourt was not an employee of Construct35. 29 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [170]. 30 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [177]. 31 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [172]. 32 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [177]. 33 See, eg, Recital A and cl 3(b) of the ASA. 34 cl 4(h) of the ASA. Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [177]-[178], [181]. Edelman The Full Court In the Full Court, Lee J applied a multifactorial approach36, although his Honour identified three "tensions" in the application of that approach to a case such as the present. Those were: the identification of "control" in a trilateral relationship; the extent to which the question whether the worker conducts his or her own business is determinative of the characterisation of the relationship; and the weight to be given to the contractual description of Mr McCourt in the ASA as "the Contractor". As to "control", Lee J considered that the gravamen of the concept of control was not the circumstance that the putative employee was in fact in a position of subordination but rather that it is the putative employer which commands the right to subordinate the employee in a position of service to the employer37. However, his Honour emphasised that control, while important, was but one indicator in the characterisation inquiry38. Indeed, his Honour went so far as to say that the control indicium "may not be particularly helpful in the characterisation of multilateral arrangements"39. As to the "own business" test, Lee J considered that while focussing the multifactorial approach on the question whether a worker is conducting a business on his or her own account may in some cases detract attention from the central question, in other cases it may prove to be a "useful way of approaching the broader inquiry". Ultimately, his Honour considered that the weight to be afforded to the "own business" question should be assessed in light of the whole picture and on a case-by-case basis40. In the circumstances of the present case, Lee J was inclined to accept the submission that the primary judge did not afford sufficient weight to 36 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 654 [73]. 37 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 656-658 [81]-[86]. 38 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 656 [81]. 39 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 658 [87]-[88]. See also 679 [170]. 40 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 660 [96]. Edelman the uncontested fact that Mr McCourt was not in business on his own account, noting that it was a "surprising result" to ascribe to a 22-year-old backpacker with Mr McCourt's limited work experience the status of "independent contractor"41. As to the description of Mr McCourt as "the Contractor", Lee J disagreed with the primary judge's use of that contractual designation as an indicator with "tie-break" effect42. His Honour considered that, in the context of a multifactorial approach that involved many factors weighed in the balance, there was a logical difficulty in assigning decisive weight to one factor43. Despite these differences of approach from that of the primary judge, Lee J dismissed the appeal and accepted that Mr McCourt was an independent contractor. His Honour said that, had the question been considered tabula rasa, he may have reached the opposite conclusion44. Ultimately, however, Lee J concluded that the present circumstances were "materially identical"45 to those considered in Personnel (No 1)46. In that case, a majority of the Western Australian Industrial Appeal Court (Steytler and Simmonds JJ, E M Heenan J dissenting) held that two labourers who had entered into agreements with Construct to supply labour to Hanssen, on similar terms to the ASA signed by Mr McCourt, were independent contractors. Lee J suggested that some of the misgivings he expressed in relation to the primary judge's approach – including those in relation to the relevance of the "own business" question and the contractual designation terms – might apply equally to the majority's reasoning in Personnel (No 1). However, Lee J could not conclude 41 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 681 [181]. 42 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 665-666 [116]-[117], 682 [183]-[184]. 43 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 666 [117]. 44 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 682 [185]. 45 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 682 [185]. Edelman that the decision was plainly wrong47. Lee J noted that it had stood for 16 years, during which time many entities had presumably relied on the decision in structuring their own arrangements48. On that basis, Lee J dismissed the appeal49. Allsop CJ, if unconstrained by authority, would also have concluded that Mr McCourt and Construct were in a relationship of employment50 because there was no indication that Mr McCourt was carrying on a business on his own account or that he was acting in any capacity other than as a builder's labourer51. Nevertheless, Allsop CJ agreed with Lee J that the appeal should be dismissed because the reasons of the majority in Personnel (No 1) did not disclose clear error, notwithstanding what Allsop CJ considered to be an overly weighted importance on the contractual designation terms52. The employment relationship and the multifactorial test Both the primary judge and the Full Court applied a "multifactorial test" to the determination of whether Mr McCourt was an employee of Construct. The manner in which that approach was applied by those courts, following Personnel (No 1), is problematic in a number of respects. 47 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 669-670 [128]-[132]. 48 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 669 [129]. 49 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 670 [133]-[134]. 50 Allsop CJ would have favoured a characterisation of Mr McCourt as a casual employee: see Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 642 [31]. 51 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 642 [29], [31]. 52 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 643-644 [36], [38]. Edelman The "own business/employer's business" dichotomy A multifactorial approach is open to the objection that it "does not provide any external test or requirement by which the materiality of the elements may be assessed"53. As Lee J recognised in this case, without guidance as to the relative significance of the various factors the "multifactorial test" is distinctly "amorphous"54 in its application, is "necessarily impressionistic"55, and thereby is "inevitably productive of inconsistency"56. Such a test is apt to generate considerable uncertainty, both for parties and for the courts. That uncertainty is exacerbated where it is contended that the test is to be applied in respect of the parties' conduct over the whole course of their dealings with each other. In Stevens v Brodribb Sawmilling Co Pty Ltd57 and Hollis v Vabu Pty Ltd58, it was said that the characterisation of a relationship as being either one of employment or one of principal and independent contractor is to be determined by reference to "the totality of the relationship between the parties". It was not suggested that this assessment should proceed as if the court is running down items on a checklist in order to determine a balance of ticks and crosses. It has never been suggested that the factors identified to be relevant are of equal weight in the characterisation of the relationship. Some understanding as to the relative significance of the various factors is desirable, both to minimise the extent to which application of the test may produce an impressionistic and subjective outcome on 53 Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 597. 54 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 655 [76]; cf Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 49. 55 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 654-655 [74]-[75]. 56 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 655 [76]. (1986) 160 CLR 16 at 29. (2001) 207 CLR 21 at 33 [24]. Edelman the one hand, and to avoid the injustice of a mechanistic checklist approach on the In this Court, the appellants submitted that the question whether a labourer is conducting his or her own independent business, as distinct from serving in the business of the employer, provides a more meaningful framework to guide the characterisation of the parties' relationship. There is force in that submission. The value of the "own business/employer's business" dichotomy in determining whether a person engaged to undertake work for another is an employee of that other has long been recognised. In an opinion written a century ago, expressed in the language of the time, by Andrews J for a strong New York Court of Appeals in Braxton v Mendelson60, his Honour said: "Ordinarily no one fact is decisive. The payment of wages; the right to hire or discharge; the right to direct the servant where to go, and what to do; the custody or ownership of the tools and appliances he may use in his work; the business in which the master is engaged or that of him said to be a special employer; none of these things give us an infallible test. At times any or all of them may be considered. The question remains: In whose business was the servant engaged at the time?" In Marshall v Whittaker's Building Supply Co61, Windeyer J said that the distinction between an employee and an independent contractor is: "rooted fundamentally in the difference between a person who serves his employer in his, the employer's, business, and a person who carries on a trade or business of his own." In Stevens62, Wilson and Dawson JJ observed that Windeyer J in Marshall "was really posing the ultimate question in a different way". Similarly, in Hollis63, the plurality referred to the statement of Windeyer J as reflecting the 59 Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 597-598. (1922) 233 NY 122 at 124. (1963) 109 CLR 210 at 217. (1986) 160 CLR 16 at 35. (2001) 207 CLR 21 at 39 [40]. Edelman "representation and ... identification with the alleged employer" that characterises a relationship as one of employment. In their Honours' view, it was another way of putting the proposition that an independent contractor "carries out his work, not as a representative but as a principal"64. It may also be noted that the Federal Court has previously recognised that viewing the totality of the relationship between the parties through the prism of this dichotomy can give useful shape and meaning to the assessment of the relative significance of the parties' rights and duties65. While the "central question"66 is always whether or not a person is an employee, and while the "own business/employer's business" dichotomy may not be perfect so as to be of universal application for the reason that not all contractors are entrepreneurs, the dichotomy usefully focusses attention upon those aspects of the relationship generally defined by the contract67 which bear more directly upon whether the putative employee's work was so subordinate to the employer's business that it can be seen to have been performed as an employee of that business rather than as part of an independent enterprise. In this way, one may discern a more cogent and coherent basis for the time-honoured distinction between a contract of service and a contract for services68 than merely forming an impressionistic and subjective judgment or engaging in the mechanistic counting of ticks on a multifactorial checklist. 64 Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 39 [39], citing Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41 at 48. 65 Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 66 Tattsbet Ltd v Morrow (2015) 233 FCR 46 at 61 [61]. 67 See [40]-[54] below. 68 Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497 at 515; Market Investigations Ltd v Minister of Social Security [1969] 2 QB 173 at 184-185. Edelman The employment relationship and the contract of employment In Commonwealth Bank of Australia v Barker69, French CJ, Bell and "The employment relationship, in Australia, operates within a legal framework defined by statute and by common law principles, informing the construction and content of the contract of employment." An employment relationship will not always be defined exclusively by a contract between the parties70. Historically, the employment relationship was recognised and regulated by the law before the law of contract came to govern the relationship71. An employment relationship, though principally based in contract, may be affected by statutory provisions and by awards made under statutes72. It may also be that aspects of the way in which a relationship plays out "on the ground" are relevant for specific statutory purposes. So, for example, a statute may operate upon an expectation generated in one party by the conduct of another, even though that expectation does not give rise to a binding agreement73. A contract of employment may be partly oral and partly in writing, or there may be cases where subsequent agreement or conduct effects a variation to the terms of the original contract or gives rise to an estoppel or waiver. In such cases, it may be that the imposition by a putative employer of its work practices upon the putative employee manifests the employer's contractual right of control over the work situation; or a putative employee's acceptance of the exercise of power may show that the putative employer has been ceded the right to impose such practices74. (2014) 253 CLR 169 at 178 [1]. See also WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 693 [56]; 392 ALR 39 at 52. 70 Concut Pty Ltd v Worrell (2000) 75 ALJR 312 at 315-316 [17]; 176 ALR 693 at 71 Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 182-183 [16]. 72 Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 178 [1]. 73 See s 65(2)(b)(ii) of the Act. 74 cf Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 41-45 [47]-[57]. Edelman While there may be cases where the rights and duties of the parties are not found exclusively within a written contract, this was not such a case. In cases such as the present, where the terms of the parties' relationship are comprehensively committed to a written contract, the validity of which is not challenged as a sham nor the terms of which otherwise varied, waived or the subject of an estoppel, there is no reason why the legal rights and obligations so established should not be decisive of the character of the relationship75. Not only is there no reason why, subject to statutory provisions or awards, established legal rights and obligations in a contract that is entirely in writing should not exclusively determine the relationship between the parties but there is every reason why they should. The "only kinds of rights with which courts of justice are concerned are legal rights"76. The employment relationship with which the common law is concerned must be a legal relationship. It is not a social or psychological concept like friendship. There is nothing artificial about limiting the consideration of legal relationships to legal concepts such as rights and duties. By contrast, there is nothing of concern to the law that would require treating the relationship between the parties as affected by circumstances, facts, or occurrences that otherwise have no bearing upon legal rights. In Narich Pty Ltd v Commissioner of Pay-roll Tax77, approving the earlier decision in Australian Mutual Provident Society v Chaplin78, in the course of delivering the reasons of the Privy Council dismissing the appeal from the Supreme Court of New South Wales, Lord Brandon of Oakbrook said that: "where there is a written contract between the parties whose relationship is in issue, a court is confined, in determining the nature of that relationship, to a consideration of the terms, express or implied, of that contract in the light of the circumstances surrounding the making of it; and it is not entitled to consider also the manner in which the parties subsequently acted in pursuance of such contract." 75 WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 693 [56]-[57], 694 [63]; 392 ALR 39 at 52-53. 76 Gouriet v Union of Post Office Workers [1978] AC 435 at 501. [1983] 2 NSWLR 597 at 600-601. (1978) 52 ALJR 407 at 409-410; 18 ALR 385 at 389-390. Edelman The one exception to this principle was said to be the case where subsequent conduct could be shown to have varied the terms of the contract79. To similar effect, in Connelly v Wells80, following Narich, Gleeson CJ said: "Where the relationship between two persons is founded in contract, the character of the relationship depends upon the meaning and effect of the contract. In the absence of a suggestion that a contract was varied after it was originally made, its meaning and effect must be determined as at the time it was entered into. If the contract is in writing, then the court which is considering the nature of the relationship between the parties is directed to an examination of the terms of the written agreement in the light of the circumstances surrounding its making81." Numerous other Australian courts have continued to recognise as authoritative the decisions in Chaplin and Narich82. In a number of decisions83, however, including the decision of the Full Court in this case84 and the decision of the Western Australian Industrial Appeal Court in Personnel (No 1)85, which the Full Court had reluctantly followed in this case, courts have proceeded on an understanding that the approach stated in Chaplin and Narich has been superseded by the adoption of a multifactorial test in cases where the relationship sought to be characterised is either one of employment or one of principal and independent contractor, even where the terms of the 79 Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 601. (1994) 55 IR 73 at 74. 81 Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 601. 82 See, eg, TransAdelaide v Leddy (1998) 71 SASR 413 at 426; Tobiassen v Reilly (2009) 178 IR 213 at 233-234 [100]-[101]; Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 at 379-380 [148]-[150] (reversed on other grounds: (2015) 256 CLR 137); Mutch v ISG Management Pty Ltd [2020] FCA 83 See, eg, ACE Insurance Ltd v Trifunovski (2013) 209 FCR 146 at 174 [107]; Jensen v Cultural Infusion (Int) Pty Ltd [2020] FCA 358 at [83]. 84 See Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 636 [8], 637 [11]-[12], 639-640 [21], (2004) 141 IR 31 at 39 [33], 44 [52]. Edelman relationship are comprehensively contained within a written contract. On this approach, the terms of the written contract are only "factors" to be considered along with other circumstances. But no decision of this Court has ever adopted or endorsed such a departure from Chaplin and Narich. Indeed, the decisions in Chaplin and Narich exemplified a long line of authority in Australia which took the same approach. This is, perhaps, unsurprising in circumstances in which the older authorities focussed upon whether the relation involved a contract of service or a contract for services. Of course, some of these decisions had regard to the factors involving the work practices of the parties in order to determine common law questions relating to the rights and duties of the parties: the terms of a contract which is partly written and partly oral; whether a contract is a sham; or whether the terms of the contract have been varied or waived, or are subject to an estoppel. But none of these decisions can be understood as a rejection, sub silentio, of the approach taken in Chaplin and Narich. To the contrary, the decisions are based upon the same principled understanding. It is necessary to descend to the detail of these cases to show why it would be a large step to reinterpret these cases to justify a departure from the settled law of Chaplin and Narich. In R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd86, this Court considered an application for an order nisi for prohibition by an insurance company seeking to restrain proceedings in the Commonwealth Court of Conciliation and Arbitration in relation to an industrial award on the basis that "agents" who canvassed insurance policies and collected premiums were independent contractors outside the concept of an industrial dispute within s 51(xxxv) of the Constitution. The company relied upon a clause in a written agreement which provided that the relationship between the parties "will be strictly that of principal and agent and not in any way whatever that of employer and employee". The union alleged that the agreement was a sham and that the matter should be remitted to a single judge to determine the facts87. The Court declined to settle the issue for a trial before a single Justice to determine whether the "real relation" between the parties was one of employer and employee, although it was observed that the materials before the Court were not satisfactory. It was enough that the company had failed to exclude the possibility of an employment relationship "whatever the agreement may say"88. In addressing (1952) 85 CLR 138. (1952) 85 CLR 138 at 144. (1952) 85 CLR 138 at 155. Edelman the submission of sham, the joint reasons of Dixon, Fullagar and Kitto JJ described the "case for the respondent union" as being that the contract "does not represent the reality of the relation in practice" and said that "if in practice the company assumes the detailed direction and control of the agents in the daily performance of their work and the agents tacitly accept a position of subordination to authority and to orders and instructions as to the manner in which they carry out their duties, a clause designed to prevent the relation receiving the legal complexion which it truly wears would be ineffectual"89. Perhaps because Dixon, Fullagar and Kitto JJ did not expressly use the word "sham" when addressing the submission of the union, the reference by their Honours to the "true" legal complexion of contractual obligations in R v Foster has also been understood to be a reference to a variation of the agreement90. Indeed, the language of a subsequent assumption of rights by the company and an acceptance of duties by the agents, as to the "legal" complexion of a relationship, is almost a textbook description of a variation of contract by conduct. This was the approach taken in Ex parte Robert John Pty Ltd; Re Fostars Shoes Pty Ltd91, where, in the course of considering whether a deed described as a deed of "licence" created a lease, Sugerman J referred to R v Foster and spoke of the need to "have regard to the real character of the relationship of the parties ... as their relations worked out in fact" apart from "the deed of licence if considered alone". As Sugerman J explained in the immediately preceding paragraph92, this was addressing the submission, set out earlier93, that "even if it be taken that the relationship between the parties was originally that of licensor and licensee, the only reasonable construction to be placed upon subsequent events is that, by tacit consent, the character of the appellant's occupation of the premises was later changed and the relationship became one of lessor and lessee". Plainly, Sugerman J was not silently abandoning "traditional principles"94 or established orthodoxy which requires that the character of an agreement as either a lease or a licence "can (1952) 85 CLR 138 at 151. 90 See, eg, Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 at 379-380 [149]. [1963] SR (NSW) 260 at 272. [1963] SR (NSW) 260 at 271. [1963] SR (NSW) 260 at 267. 94 Western Australia v Ward (2002) 213 CLR 1 at 229 [521]. Edelman only be determined by consideration of the effect of the agreement"95. His Honour was describing a variation of the agreement. Prior to Chaplin and Narich, examples abound of this Court focussing only upon the terms of the contract, with any consideration of subsequent conduct of the parties for the purposes only of assessing alterations of their rights such as variations of their agreement. In case after case after case, this Court can be seen to be applying basic, established principles of contract law rather than effecting a silent revolution. In Logan v Gilchrist96, this Court treated the question of whether a drover was an employee or an independent contractor as whether, as Isaacs J put it, the putative employer has "a right at the moment to control the doing of the act"97 or, as Higgins J put it, a question which "is answered by the contents of the agreement"98. In Queensland Stations Pty Ltd v Federal Commissioner of Taxation99 and Humberstone v Northern Timber Mills100, Dixon J spoke respectively of whether "such a contract created the relation of ... employer and employee" and whether "the contract placed the supposed servant subject to the command of the employer ... not whether in practice the work was in fact done subject to a direction and control". In Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd101, Latham CJ spoke of the "decisive element" 95 Street v Mountford [1985] AC 809 at 819. See also Bruton v London & Quadrant Housing Trust [2000] 1 AC 406 at 413. (1927) 33 ALR 321. (1927) 33 ALR 321 at 322 (emphasis added), quoting Bain v Central Vermont Railway Company [1921] 2 AC 412 at 416. (1927) 33 ALR 321 at 322. (1945) 70 CLR 539 at 551. See also 544 per Latham CJ, asking whether "the contracts created the relation of employer and employee". See further 548 per 100 (1949) 79 CLR 389 at 404. See also Wright v Attorney-General for the State of Tasmania (1954) 94 CLR 409 at 418. 101 (1944) 69 CLR 227 at 233 (emphasis added), quoting in part from the American Law Institute, Restatement of the Law, Agency, vol 1 at 483. Edelman in characterising a relationship of employment as being "the extent of control which, by the agreement, the master may exercise". In other cases, members of this Court have considered subsequent conduct of the parties but only in order to ascertain the effect upon the legal rights of the parties, such as whether an agreement was a sham or whether the terms had been varied. For instance, in responding to a submission of sham in Cam and Sons Pty Ltd v Sargent102, Dixon J spoke of investigating the "substance" of a written agreement that contained "elaborate provisions expressed in terms appropriate to some other relation", but emphasised that it was the agreement which was to be analysed103. Lest there be any doubt, it has been held that this decision is consistent with the focus in Chaplin and Narich upon the terms of the written contract104. In Neale v Atlas Products (Vic) Pty Ltd105, this Court again considered a submission that the terms of a written agreement were a "sham". It was held that the written agreement, which "substantially set forth the conditions upon which each tiler was employed", was "the real measure of the relationship between the parties" and that "we should not be disposed to ignore it unless it can be said that the evidence establishes quite clearly that the conduct of the parties was inconsistent with it as the basis of their relationship"106. To the extent that it has been supposed that a departure from the long-standing approach predating, but exemplified in, Chaplin and Narich was required by this Court's decisions in Stevens and Hollis, that understanding is also not correct. In neither Stevens nor Hollis did this Court suggest that, where one person has done work for another pursuant to a comprehensive written contract, the court must perform a multifactorial balancing exercise whereby the history of all the dealings between the parties is to be exhaustively reviewed even though no party disputes the validity of the contract. 102 (1940) 14 ALJ 162 at 163. 103 See also Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 561 at 571, "the terms of the engagement fixed the character of the act"; Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210 at 215, the requirements of the contract "by its terms". 104 TransAdelaide v Leddy (1997) 76 IR 341 at 348-349. Not doubted on appeal on this point: TransAdelaide v Leddy (1998) 71 SASR 413. 105 (1955) 94 CLR 419 at 422. 106 (1955) 94 CLR 419 at 428. Edelman In Stevens, Mason J said that "it is the totality of the relationship between the parties which must be considered". But this statement was made in the context of a discussion the point of which was to emphasise that the right of one party to control the work of another was "not ... the only relevant factor"107. It was not an invitation to broaden the inquiry beyond the contractual rights and duties of the parties. Importantly, Stevens was not a case where the parties had committed the terms of their relationship to a written contract108. In this respect, Stevens stands in obvious contrast to cases like Chaplin and Narich – and the present case. In Hollis, the "contractual relationship" pursuant to which Vabu "imposed" its work practices upon couriers was partly oral and partly in writing109. The terms of the relationship between the parties had not been committed comprehensively to a written agreement. Moreover, there was no suggestion in any of the judgments in Stevens or Hollis that their Honours entertained any misgivings as to the statements of principle in Chaplin and Narich. Indeed, in Stevens, Mason J (with whom Brennan J agreed) and Wilson and Dawson JJ referred to Chaplin with evident approval110. It is also noteworthy that Gleeson CJ, who followed Narich in Connelly v Wells, was a party to the plurality judgment in Hollis. As has been correctly observed, Hollis "does not alter or even challenge the orthodox principle that courts are not concerned with what has 'actually occurred' in a relationship, but rather with 'the obligations by which the parties [are] bound'"111. Uncertainty in relation to whether a relationship is one of employment may sometimes be unavoidable. It is the task of the courts to promote certainty with respect to a relationship of such fundamental importance. Especially is this so where the parties have taken legitimate steps to avoid uncertainty in their relationship. The parties' legitimate freedom to agree upon the rights and duties which constitute their relationship should not be misunderstood. It does not extend 107 (1986) 160 CLR 16 at 29. 108 See (1986) 160 CLR 16 at 39. 109 (2001) 207 CLR 21 at 33 [24]. 110 (1986) 160 CLR 16 at 26, 39. 111 Stewart, "Redefining Employment? Meeting the Challenge of Contract and Agency Labour" (2002) 15 Australian Journal of Labour Law 235 at 250-251, quoting Express & Echo Publications Ltd v Tanton [1999] ICR 693 at 697. See also Bomball, "Subsequent Conduct, Construction and Characterisation in Employment Contract Law" (2015) 32 Journal of Contract Law 149 at 157. Edelman to attaching a "label" to describe their relationship which is inconsistent with the rights and duties otherwise set forth. To do so would be to elevate their freedom to a power to alter the operation of statute law to suit themselves or, as is more likely, to suit the interests of the party with the greater bargaining power. Where the parties have comprehensively committed the terms of their relationship to a written contract the validity of which is not in dispute, the characterisation of their relationship as one of employment or otherwise proceeds by reference to the rights and obligations of the parties under that contract. Where no party seeks to challenge the efficacy of the contract as the charter of the parties' rights and duties, on the basis that it is either a sham or otherwise ineffective under the general law or statute112, there is no occasion to seek to determine the character of the parties' relationship by a wide-ranging review of the entire history of the parties' dealings. Such a review is neither necessary nor appropriate because the task of the court is to enforce the parties' rights and obligations, not to form a view as to what a fair adjustment of the parties' rights might require113. In this respect, the principles governing the interpretation of a contract of employment are no different from those that govern the interpretation of contracts generally. The view to the contrary, which has been taken in the United Kingdom114, cannot stand with the statements of the law in Chaplin and Narich. The foregoing should not be taken to suggest that it is not appropriate, in the characterisation of a relationship as one of employment or of principal and independent contractor, to consider "the totality of the relationship between the parties"115 by reference to the various indicia of employment that have been identified in the authorities. What must be appreciated, however, is that in a case such as the present, for a matter to bear upon the ultimate characterisation of a relationship, it must be concerned with the rights and duties established by the parties' contract, and not simply an aspect of how the parties' relationship has come 112 See, eg, Independent Contractors Act 2006 (Cth), Pt 3; Contracts Review Act 1980 (NSW), Pt 2; Industrial Relations Act 1996 (NSW), Ch 2 Pt 9; Industrial Relations Act 2016 (Qld), Ch 11 Pt 2 Div 4 Subdiv 7. 113 WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 694 [62]-[63]; 392 ALR 39 at 53; cf Fish v Solution 6 Holdings Ltd (2006) 225 CLR 180. 114 Autoclenz Ltd v Belcher [2011] 4 All ER 745 at 752-757 [20]-[35]. 115 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 29; Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 33 [24]. Edelman to play out in practice but bearing no necessary connection to the contractual obligations of the parties. WorkPac Pty Ltd v Rossato116 concerned the question whether a person who was engaged to work under what were indisputably contracts of employment was a casual employee. This Court rejected the argument that this question was to be determined by reference to all the circumstances of the employment, including disparities in the bargaining power of the parties. Hollis117 had been cited in support of that argument. Kiefel CJ, Keane, Gordon, Edelman, Steward and Gleeson JJ noted that because, in Rossato, the Court was concerned with what was, on any view, a contract of employment, Hollis was not on point. Their Honours went on to say that, "[o]n one view", the resolution of the question whether a person engaged to work for another is an employee or an independent contractor "may depend upon the extent to which it can be shown that one party acts in the business of, and under the control and direction of, the other"118. But because the issue of present concern did not arise in Rossato, the plurality refrained from expressing a concluded view as to the significance of the observations in Hollis in relation to that issue. The occasion to express a view on that matter has now arrived: the point was squarely raised and fully argued. There is no reason in principle why the approach taken in Rossato should not be applied where the issue is whether the relationship in question is one of employment. The parties' description of their relationship To say that the legal character of a relationship between persons is to be determined by the rights and obligations which are established by the parties' written contract is distinctly not to say that the "label" which the parties may have chosen to describe their relationship is determinative of, or even relevant to, that characterisation. Subject to statute, under the common law the parties are free to agree upon the rights and obligations by which they are to be bound. But the determination of 116 (2021) 95 ALJR 681; 392 ALR 39. 117 (2001) 207 CLR 21 at 33 [24]. 118 WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 700 [101]; 392 ALR 39 at 61, citing R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138 at 151. Edelman the character of the relationship constituted by those rights and obligations is a matter for the court119. In Chaplin120, Lord Fraser of Tullybelton said that a provision of a contract, whereby the parties sought to define their relationship as one of "Principal and Agent and not that of Master and Servant", "cannot receive effect according to its terms if they contradict the effect of the agreement as a whole". It was accepted, however, that ambiguity in the character of a relationship might be removed by a provision whereby the parties agreed on terms descriptive of their status or relationship121. As a matter of principle, however, it is difficult to see how the expression by the parties of their opinion as to the character of their relationship can assist the court, whose task it is to characterise their relationship by reference to their rights and duties. Generally speaking, the opinion of the parties on a matter of law is irrelevant. Even if it be accepted that there may be cases where descriptive language chosen by the parties can shed light on the objective understanding of the operative provisions of their contract, the cases where the parties' description of their status or relationship will be helpful to the court in ascertaining their rights and duties will be rare. Having made these general observations, one may turn now to consider the relationship between the present parties. Mr McCourt served in the business of Construct In this Court, Construct was content to disavow the notion that Mr McCourt was carrying on his own business. That disavowal might be said to be no more than recognition that any suggestion to that effect was unsustainable. As both the 119 R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138 at 151; Australian Mutual Provident Society v Chaplin (1978) 52 ALJR 407 at 409-410; 18 ALR 385 at 389-390; Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 600-601; WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 699-700 [97]; 392 ALR 39 at 60. 120 (1978) 52 ALJR 407 at 409; 18 ALR 385 at 389. 121 Citing Massey v Crown Life Insurance Co [1978] 1 WLR 676; [1978] 2 All ER 576. Edelman primary judge122 and the Full Court123 appreciated, Mr McCourt could not sensibly be said to have been carrying on business on his own account. That was plainly correct, notwithstanding the language used in the ASA to describe Mr McCourt's occupation which suggested otherwise. Lehigh Valley Coal Co v Yensavage124 concerned the question whether a coal miner working on a mine site was the employer of his "helper", who had been injured in an explosion at the mine, for the purposes of a statute which imposed an obligation upon employers to provide a safe system of work. The mine owner contended that neither the coal miner nor the injured "helper" was its employee. Coxe and Learned Hand JJ ridiculed the mine owner's contention by observing that, if that contention were accepted125: "[t]he [mine owner] is therefore not in the business of coal mining at all, in so far as it uses such miners, but is only engaged in letting out contracts to independent contractors, to whom they owe as little duty as to those firms which set up the pumps in their mines. ... It is absurd to class such a miner as an independent contractor ... He has no capital, no financial responsibility. He is himself as dependent upon the conditions of his employment as the company fixes them as are his helpers. By him alone is carried on the company's only business; he is their 'hand,' if any one is. Because of the method of his pay one should not class him as though he came to do an adjunctive work, not the business of the company, something whose conduct and management they had not undertaken." This lampooning of the mine owner's argument focussed attention on the nature of the mine owner's business in order to highlight the absurdity of the notion that the mine owner was no more than an introduction agency and that the coal miner was carrying on a business that was separate from the business of the mine owner. That is a useful focus in this case too. Construct submitted that it was "simply a finder of labour". But that ignores the complex suite of rights and obligations of Construct vis-à-vis Mr McCourt that 122 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [150]. 123 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 642 [29]. See also 681 [181]. 124 (1914) 218 F 547 (2nd Cir). 125 (1914) 218 F 547 (2nd Cir) at 552-553. Edelman reward for his work (cl 2(a)); had been established under the ASA. Construct was authorised: to fix Mr McCourt's to act as Mr McCourt's paymaster (cll 1(d), 2(d)); and to terminate Mr McCourt's engagement should he fail in any respect to obey the directions of Construct or Hanssen (see cl 4(a), (c)). And, as will be seen, by cl 4(a) Construct retained a right of control over Mr McCourt that was fundamental to its business as a labour-hire agency. There would be no reason for the existence of such obligations if Construct were not in the business of labour hire, but rather in the business of "introducing" suppliers of labour to builders and leaving those parties to sort their own affairs. In terms of the test suggested by Windeyer J in Marshall, it is impossible to say that Mr McCourt was in business on his own account. The core of Mr McCourt's obligation to Construct under the ASA was his promise to work as directed by Construct or by its customer126. Mr McCourt's obligation to work was meaningful only because the benefit of that promise was ventured by Construct as an asset of its labour-hire business. Mr McCourt worked subject to the control of Construct Like the "own business/employer's business" dichotomy, the existence of a right of control by a putative employer over the activities of the putative employee serves to sensitise one to the subservient and dependent nature of the work of the employee, so as to assist in an assessment of whether a relationship is properly to be regarded as a contract of service rather than a contract for services. Construct submitted that control was a necessary, though not sufficient, condition of a contract of service, citing Zuijs v Wirth Brothers Pty Ltd127. It was submitted that Hanssen alone supervised and directed every aspect of Mr McCourt's work, and it was emphasised that Construct was not entitled, under either the LHA or the ASA, to enter Hanssen's site and issue directions to Mr McCourt regarding the performance of his work. So much may be accepted. But this Court in Stevens128, and indeed in Zuijs129 itself, emphasised that it is the right of a person to control the work of the other, rather than the detail of the actual 126 cl 4(a) of the ASA. 127 (1955) 93 CLR 561 at 571. 128 (1986) 160 CLR 16 at 24, 36. 129 (1955) 93 CLR 561 at 571. Edelman exercise of control, which serves to indicate that a relationship is one of employer and employee. Under the ASA, Construct was entitled to determine for whom Mr McCourt would work130. Once assigned to a client, Mr McCourt was obliged by cl 4(a) to "[c]o-operate in all respects with Construct and the builder in the supply of labour to the Builder". That obligation must be understood in context. It was not directed towards the carrying out of any particular task, or the effecting of any specific result, for Hanssen. There was no suggestion that the work Mr McCourt agreed to do would involve the exercise of any discretion on his part, either as to what he would do or as to how he would do it. Mr McCourt's obligation to "supply ... labour" in cooperation with Hanssen necessarily meant that he agreed, for the duration of the assignment, to work in accordance with Hanssen's directions. He was simply not permitted to do otherwise. Had Mr McCourt breached cl 4(a), Construct (not Hanssen) would have been entitled to terminate the ASA. Mr McCourt's performance of that obligation was unambiguously central to Construct's business of supplying labour to builders. In referring Mr McCourt to Hanssen, Construct was exercising, and commercialising, its right to control the work that Mr McCourt would do and how he would do it. The marketability of Construct's services as a labour-hire agency turned on its ability to supply compliant labour; without that subservience, that labour would be of no use to Construct's clients. That right of control was therefore the key asset of Construct's business. Its significance was not diminished by the circumstance that the minutiae of Mr McCourt's performance of daily tasks were at the direction of Hanssen. Indeed, the right of control held by Construct over Mr McCourt explains why there was no need for any contractual relationship between Mr McCourt and Hanssen in order to support Hanssen's ability to issue day-to-day directions to Mr McCourt. Mr McCourt had no right to exercise any control over what work he was to do and how that work was to be carried out. That state of affairs was attributable to the ASA, by which Mr McCourt's work was subordinated to Construct's right of control. Contrary to Construct's submissions, and to the observations of Lee J131, there is nothing in the tripartite nature of a labour-hire arrangement that precludes recognition of Construct's contractual right to control the provision of Mr McCourt's labour to its customers, and the significance of that right to the 130 cll 1(a)-(c), 3(c) of the ASA. 131 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 658 [87]-[88], 679 [170]. Edelman relationship between Construct and Mr McCourt. As between Construct, Mr McCourt and Hanssen, it was only by reason of Mr McCourt's promise to Construct that Mr McCourt was bound to work as directed by Hanssen. Mr McCourt's designation as "the Contractor" is of no moment The ASA described Mr McCourt as "the Contractor". But the effect of the rights and duties created by the ASA was that Mr McCourt was engaged by Construct to serve Construct in its business. The rights and duties agreed between Construct and Mr McCourt leave no room for ambiguity as to the character of that relationship. For the reasons stated above, that the parties have described their relationship a certain way cannot change the character of the relationship established by their rights and obligations. Lee J was right to suggest that it was erroneous in point of principle to use the parties' description of their relationship to resolve uncertainty produced by application of the multifactorial test. There was no occasion to have recourse to the label chosen by the parties, whether as a "tie-breaker" or otherwise. Policy considerations underpinning vicarious liability Pursuant to a notice of contention, Construct argued that the Full Court ought to have found that none of the policy concerns which underpin the vicarious liability of an employer for the actions of its employees favoured a characterisation of Mr McCourt's engagement as one of employment. In this regard, Construct argued that, as a result of its absence of practical ability or legal authority to influence the actual performance by Mr McCourt of work on site, the imposition of vicarious liability on Construct would have no useful deterrent effect on its willingness to court risks to workplace health and safety. Secondly, Construct submitted that it was Hanssen, as builder, which created any enterprise risk, and therefore Construct should not bear vicarious liability for Mr McCourt's actions in furtherance of Hanssen's enterprise. Thirdly, Construct submitted that because Mr McCourt was not integrated into Construct's business – for example, by the wearing of a uniform or by acting publicly as Construct's representative – it could not be said that Mr McCourt was a public manifestation of Construct's business for whom Construct should be held responsible. The simple answer to these submissions is that these broad appeals to considerations of policy cannot alter the effect of the ASA, any more than Mr McCourt's invocation of the disparity in bargaining power can alter its effect in his favour. In any event, it is important to recognise that Construct was able, by the deployment of its right of control over Mr McCourt, to determine the industrial environment in which he would work; and so there is nothing counter-intuitive about recognising both Construct's non-delegable duty to him and its vicarious liability for his acts or omissions. Edelman However, given the confusion that arises from the conflation of questions of vicarious liability of an employer with questions of characterisation of a putative employment relationship, it is necessary to explain the difference. There are two conceptions of vicarious liability of an employer132: the traditional "agency" conception, where an employer has a primary liability for the actions of an employee or other agent133; and the policy-based conception, where an employer has a secondary liability for the liability of the employee134. On either conception, the relationship of employment is only the first step in ascertaining whether vicarious liability exists. There is a necessary second step which requires consideration of the subsequent conduct of the employee, the event for which the employer is to be held primarily or secondarily liable, and its association with the employment relationship. In many cases involving issues of vicarious liability in either sense above, whether or not the relationship is one of employment, the focus is upon the second step of the inquiry135. It is essential in such cases to consider the conduct of the parties subsequent to the contract that establishes their relationship, especially the conduct of the person whose actions have caused the injury. Hollis was a case of such vicarious liability. Since the contract between the parties was not entirely in writing, the subsequent conduct of the parties was necessary to establish the terms of their agreement. But it was also separately necessary to establish satisfaction of the second step of the vicarious liability inquiry. Non-exclusive work is consistent with casual employment For the sake of completeness, it should also be said that the primary judge erred in concluding that the circumstances that Mr McCourt was free to accept or reject any offer of work136, and that he was not precluded from working for 132 Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd (2016) 250 FCR 133 Darling Island Stevedoring and Lighterage Co Ltd v Long (1957) 97 CLR 36 at 60. 134 Darling Island Stevedoring and Lighterage Co Ltd v Long (1957) 97 CLR 36 at 57. 135 See, eg, Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co- operative Assurance Co of Australia Ltd (1931) 46 CLR 41. 136 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [143]. Edelman others137, were factors which contraindicated a characterisation of his relationship with Construct as one of employment. It is commonplace that casual employees do not work exclusively for one employer. In addition, Mr McCourt's right pursuant to cl 5(b) of the ASA to accept or reject any offer of work from a builder must be understood subject to his promise to Construct in cl 4(c) of the ASA to "supply labour ... for the duration required by [Hanssen]". His right to reject an offer of work was exercisable at the level of an overall engagement with Hanssen, rather than on the basis of a new engagement each day. Earlier decisions involving triangular labour-hire arrangements Construct argued that Personnel (No 1)138, when viewed alongside the decisions in Building Workers Industrial Union of Australia v Odco Pty Ltd139 and Young v Tasmanian Contracting Services Pty Ltd140, established a body of authority in which "Odco-style" triangular labour-hire arrangements have been held not to create relationships of employment. It was submitted that this Court should not overturn this long-standing position. Many persons, it was said, will have relied on these decisions in arranging their affairs. In this regard, Personnel (No 1) was wrongly decided, the critical error of the reasoning of the majority being the attribution of decisive significance141 to the parties' description of their relationship in a manner so as to "remove [the] ambiguity"142 generated by other factors in the analysis pointing in opposite 137 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2019] FCA 1806 at [146]. 139 (1991) 29 FCR 104. 140 [2012] TASFC 1. 141 (2004) 141 IR 31 at 40-41 [38]-[42], 61-63 [139]-[150]. 142 (2004) 141 IR 31 at 62 [145]. See also 40-41 [40]. Edelman directions. The same error infected the decision in Odco143. That error involves a departure from principle which should not be perpetuated. Construct also placed reliance on the decision of the Court of Appeal in Bunce v Postworth Ltd144. In that case, it was held that a labour-hire agency was not in a relationship of employment with its worker because it lacked the requisite power of control, which instead was found to reside in the client to whom the worker was assigned. The Court of Appeal rejected the argument that the client's day-to-day control originated in the contract between the labour-hire agency and the worker. Keene LJ (with whom Gage LJ and Sir Martin Nourse agreed) said that145: "[t]he law has always been concerned with who in reality has the power to control what the worker does and how he does it." (emphasis in original) The decision in Bunce is of little assistance in this case. The reference by Keene LJ to the "reality" of the situation does not accord with the central importance of the rights and duties established by the parties in their written contract. It suggests that the "reality" of the situation is, in some unexplained way, of a significance that transcends the rights and obligations agreed by the parties. To the extent that this involves an assumption that employment contracts are to be interpreted differently from contracts generally, that assumption is not consistent with the law in Australia. Further, the Court of Appeal's emphasis on the exercise of control is inconsistent with the recognition by this Court that the gravamen of the concept of control lies in the authority to exercise control and not its practical exercise146. Conclusion Under the ASA, Mr McCourt promised Construct to work as directed by Construct and by Construct's customer, Hanssen. Mr McCourt was entitled to be paid by Construct in return for the work he performed pursuant to that promise. 143 Odco Pty Ltd v Building Workers' Industrial Union of Australia (unreported, Federal Court of Australia, 24 August 1989) at 126; Building Workers' Industrial Union of Australia v Odco Pty Ltd (1991) 29 FCR 104 at 126-127. 144 [2005] IRLR 557. 145 [2005] IRLR 557 at 561 [29]. 146 Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 561 at 571; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 24, 29, 36; Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 41 [44]. Edelman That promise to work for Construct's customer, and his entitlement to be paid for that work, were at the core of Construct's business of providing labour to its customers. The right to control the provision of Mr McCourt's labour was an essential asset of that business. Mr McCourt's performance of work for, and at the direction of, Hanssen was a direct result of the deployment by Construct of this asset in the course of its ongoing relationship with its customer. In these circumstances, it is impossible to conclude other than that Mr McCourt's work was dependent upon, and subservient to, Construct's business. That being so, Mr McCourt's relationship with Construct is rightly characterised as a contract of service rather than a contract for services. Mr McCourt was Construct's employee. Orders The appeal should be allowed. The respondent should pay the appellants' costs of the appeal to this Court. The order of the Full Court of the Federal Court of Australia made on 17 July 2020 should be set aside and, in its place, it is ordered that: The appeal be allowed. The order of the Federal Court of Australia made on 6 November 2019 be set aside. It be declared and ordered that, between 27 July 2016 and 6 November 2016 and 14 March 2017 and 30 June 2017, the second appellant was employed by the respondent. The matter be remitted to the primary judge for determination according to law. There should be no order as to the costs in the Full Court. GAGELER AND GLEESON JJ. The Fair Work Act 2009 (Cth) for the most part confers rights and imposes obligations on, and in respect of the relationship between, an employer and an employee147. The terms "employer" and "employee" are defined to "have their ordinary meanings"148. The "ordinary meanings" to which that foundational definition refers are not the grammatical meanings of the legislatively chosen words purposively construed in their statutory context149. The reference in the definition is instead to the meanings ascribed to "employer" and "employee" at common law150. The meanings ascribed to "employer" and "employee" at common law have been formulated over the past two centuries principally in the context of drawing, for the purpose of tortious liability, "the distinction between employees (for whose conduct the employer will generally be vicariously liable) and independent contractors (for whose conduct the person engaging the contractor will generally not be vicariously liable)"151. The common law distinction which has been drawn for that purpose has been said in this century in this country to be "too deeply rooted to be pulled out"152. Around the beginning of the twentieth century, the common law distinction "came somewhat deviously and indirectly into the early law of workmen's compensation"153. The common law distinction came in the course of the twentieth century to be imported more directly into a range of other areas of statute law, including industrial relations, taxation and superannuation. The Fair Work Act continued that trend when, early in this century, its elaborate statutory edifice was erected on the foundation of precisely the same common law distinction. 147 Section 12 (definitions of "employee" and "national system employee") and ss 13-14, 15 of the Fair Work Act. 148 Section 11 of the Fair Work Act. 149 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 150 Australia, House of Representatives, Fair Work Bill 2008, Explanatory Memorandum at 5. See C v The Commonwealth (2015) 234 FCR 81 at 87 [34]-[36]. 151 Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 at 167 [12]. 152 Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 at 173 [33]. 153 Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210 at 217. Professor Patrick Atiyah once noted that154: "In attempting an answer to the question, 'Who is a servant?' two approaches are possible. The first is based on the assumption that a contract of service is a legal concept known to the law in a variety of contexts, and that the first enquiry in any case involving vicarious liability should be directed to the question whether a contract of service exists. ... The alternative approach emphasises that the classification of a particular factual situation must always be considered in the light of the purpose for which the classification is being made." The common law in and of Australia has steadfastly adhered to the first of those two approaches, and the Australian legislative references to employment or service have generally adopted the common law. Curial adherence to, and legislative adoption of, the same approach has not been quite so consistent in some other common law jurisdictions. In the United Kingdom, the common law distinction seems of late largely to have been abandoned155. In the United States, the common law distinction has been maintained, but different approaches have been taken in different statutes at different times156. So we have it that, like the National Labor Relations Act 1935 (US) as amended from 1947157 and like the Commonwealth Conciliation and Arbitration Act 1904 (Cth) as also amended from 1947158, but unlike the Fair Labor Standards 154 Atiyah, Vicarious Liability in the Law of Torts (1967) at 31. 155 Gray, Vicarious Liability (2018) at 197-199. 156 See Carlson, "Why the Law Still Can't Tell an Employee When It Sees One And How It Ought to Stop Trying" (2001) 22 Berkeley Journal of Employment and Labor Law 295 at Pts II-IV. 157 Labor Management Relations Act 1947 (US). See National Labor Relations Board v United Insurance Co of America (1968) 390 US 254 at 256. 158 Commonwealth Conciliation and Arbitration Act 1947 (Cth). See R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138 at 150. See now also Superannuation Guarantee (Administration) Act 1992 (Cth); Independent Contractors Act 2006 (Cth). Act 1938 (US)159 and the National Minimum Wage Act 1998 (UK)160, the Fair Work Act postulates the existence of employment at common law as a precondition to its operation. Subject to presently immaterial exceptions, unless two persons are or have been in a relationship of employment at common law independently of the operation of the Fair Work Act, one of those persons cannot be an "employer" and the other cannot be an "employee" within the meaning of the Fair Work Act. Although the context is statutory, the outcome of this appeal therefore turns on a question which arises at common law. The question is as to how the existence of a relationship of employment is to be determined. The question has not squarely arisen in this Court for 20 years. The answer is of far-reaching importance. The question now arises for the consideration of this Court in a procedural context fully described by Kiefel CJ, Keane and Edelman JJ. Their Honours' explanation of the facts and abbreviations can conveniently be adopted. Some additional facts will be mentioned in due course. The ultimate issue in the appeal is whether Mr McCourt was employed by Construct under the ASA during the two discrete periods during which Construct made the labour of Mr McCourt available to Hanssen under the LHA. The first period was from 27 July 2016 to 6 November 2016. The second period was from 14 March 2017 to 30 June 2017. Our conclusion on the ultimate issue is that, whilst Mr McCourt was not employed by Construct merely by reason of having entered into the ASA, Mr McCourt was employed by Construct during each of those periods by reason of what then occurred in the performance of the ASA. The pathway of analysis leading to that conclusion proceeds in three stages. The first stage involves examining the nature of a relationship of employment at common law – the critical point being that it is a relationship which exists in fact. The second stage involves identifying the scope of the inquiry to be undertaken to determine whether a relationship that exists in fact is a relationship of that nature – the critical point being that it involves looking beyond contractual terms to contractual performance. The final stage involves examining the relationship that existed in fact between Mr McCourt and Construct during the periods during which Construct made the labour of Mr McCourt available to Hanssen. That examination illuminates points of distinction between their relationship and some 159 Rutherford Food Corp v McComb (1947) 331 US 722 at 727-728; Nationwide Mutual Insurance Co v Darden (1992) 503 US 318 at 326. 160 Uber BV v Aslam [2021] 4 All ER 209 at 226 [68], 227 [71], explaining Autoclenz Ltd v Belcher [2011] 4 All ER 745. other "triangular" labour hire relationships which have been found in the past not to be relationships of employment. The nature of a relationship of employment at common law Employment at common law has its roots in the relationship of service which the common law recognised between master and servant. Employment is a voluntary relationship between an individual, the employee, and another person, the employer, within which the employee performs a genus of work for the employer – what was traditionally called "service" – in exchange for some form of remuneration. Typically, although not universally161, the relationship of employment is established and maintained under a contract between the employer and the employee. Throughout the nineteenth century, a contract under which a relationship of master and servant was established was routinely referred to as a contract of service. Moving into the twentieth century, a contract under which a relationship of employer and employee was established and maintained came more commonly to be referred to as a contract of employment162. The terminology remains apt so long as two things are recognised. One is that a contract under which a relationship of employment is established and maintained need not be a contract that deals solely with the subject-matter of employment: a relationship of employment can be established and maintained under a contract that has contractual purposes broader than, and contractual consequences additional to, simply establishing a relationship within which an individual performs work of the requisite genus for another person. The other is that it is the character of the relationship that is established and maintained under a contract that gives character to the contract. Expressed using other prepositional terms, a contract "of" employment is a contract "for" a relationship of employment163. The employment relationship is established and maintained "within" the contractual relationship, the employment relationship does not subsist simply "in" the contractual relationship. 161 Attorney-General for NSW v Perpetual Trustee Co Ltd (1952) 85 CLR 237 at 250. 162 Amalgamated Society of Carpenters and Joiners v Haberfield Pty Ltd (1907) 5 CLR 163 cf Gardner, "The Contractualisation of Labour Law", in Collins, Lester and Mantouvalou (eds), Philosophical Foundations of Labour Law (2018) 33 at 42, referring to Emmens v Elderton (1853) 13 CB 495 at 506. In Dare v Dietrich164, Lockhart J, in addressing the question of whether a contract under which one person does work for another is a contract of service, pointed out that "[t]he question is answered by examining all the various elements which constitute the relationship between the parties"165. In the same case Deane J said166: "A contract of service is that form of contract which embodies the social relationship of employer and employee. It cannot be identified by reference to the presence of any one or more static characteristics. The relationship is a dynamic one which needs to be accommodated to a variety of different and changing social and economic circumstances. It is, however, of the essence of a contract of service that it is a bilateral contract involving executory obligations on behalf of both employer and employee". On the appeal to this Court, the substance of the reasoning of both Lockhart J and Deane J was endorsed by Gibbs, Mason and Wilson JJ, with whom Aickin J agreed167. In finding that the arrangement between the parties in that case did not give rise to a contract of service, the plurality observed that the arrangement "lacked the element of mutuality of obligation that is essential to the formation of such a contract"168. The centrality of the concern of the common law with the identification and characterisation of the relationship established and maintained between employer and employee under a contract has been emphasised in the description of a contract of employment as having "a two-tiered structure"169: "At the first level there is an exchange of work and remuneration. At the second level there is an exchange of mutual obligations for future performance. The second level – the promises to employ and be employed – provides the arrangement with its stability and with its continuity as a 164 (1979) 26 ALR 18. 165 (1979) 26 ALR 18 at 40. 166 (1979) 26 ALR 18 at 36. 167 Dietrich v Dare (1980) 54 ALJR 388 at 391, 392; 30 ALR 407 at 412, 414. 168 Dietrich v Dare (1980) 54 ALJR 388 at 390; 30 ALR 407 at 411. 169 Freedland, The Contract of Employment (1976) at 20, quoted in Commonwealth Bank of Australia v Barker (2013) 214 FCR 450 at 513 [291]. contract. The promises to employ and to be employed may be of short duration, or may be terminable at short notice; but they still form an integral and most important part of the structure of the contract. They are the mutual undertakings to maintain the employment relationship in being which are inherent in any contract of employment properly so called." That description is consistent with the recent holding in WorkPac Pty Ltd v Rossato170 that the distinction between a casual employee and another employee, according to the ordinary meaning of "casual employee", lay in the absence of a "firm advance commitment" as to the duration of the employee's employment to be found, if at all, in the terms of the contract of employment. There, six consecutive relationships of casual employment were found to have been created pursuant to six consecutive contracts of employment, each incorporating standard terms and conditions171. Here, for reasons that will eventually be explained, Mr McCourt entered into two consecutive relationships of casual employment with Construct in the performance by him and Construct of a single overarching contract: the ASA. The relationship of employment is, however, not to be conflated with the contract under which the relationship is established and maintained. The two are "distinct"172. "The employment is the continual relationship, not the engagement or contracting to employ and to serve."173 "It is the service ... carried on."174 Whether a continual relationship for which a contract might make provision actually exists at any given time is a question of fact175. Whatever the contract might say about the obligations of the parties, a relationship of employment does not exist until the relationship is in fact formed, and the relationship of employment ceases to exist when the relationship is in fact broken. Thus, "[i]t does not appear to have been doubted in this country that a wrongful dismissal terminates the employment relationship notwithstanding that the contract of employment may continue until the employee accepts the repudiation constituted by the wrongful 170 (2021) 95 ALJR 681; 392 ALR 39. 171 (2021) 95 ALJR 681 at 687 [13], 696-697 [76]-[80]; 392 ALR 39 at 43, 55-56. 172 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 427. 173 Mynott v Barnard (1939) 62 CLR 68 at 91 (cleaned up). 174 Mynott v Barnard (1939) 62 CLR 68 at 91 (cleaned up). 175 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 428. dismissal and puts an end to the contract"176. One consequence is that a wrongfully dismissed employee can refuse to accept the dismissal and can "[keep] the contract open" by remaining ready and willing to work177. If the employer can then be induced to retract the dismissal, the employment relationship can be re-established without need for a new contract178. Here, again for reasons that will eventually be explained, Mr McCourt and Construct in fact established and maintained continual relationships for the doing of work by Mr McCourt throughout each of the two periods during which Construct made his labour available to Hanssen under the LHA. They did not establish a relationship of the requisite kind merely by entering into the ASA and they did not maintain a relationship of the requisite kind throughout the entirety of the term of the ASA. Where a continual relationship under which work is done by an individual in exchange for remuneration in fact exists, the characterisation of that relationship as one of employment or service, on the one hand, or as one of hirer and independent contractor, on the other hand, has long been understood to turn on one or other or both of two main overlapping considerations. The first is the extent of the control that the putative employer can be seen to have over how, where and when the putative employee does the work179. The second is the extent to which the putative employee can be seen to work in his or her own business as distinct 176 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 427, applying Automatic Fire Sprinklers Pty Ltd v Watson (1946) 72 CLR 435 at 469. See also Visscher v Giudice (2009) 239 CLR 361 at 379-380 [53]-[55]. 177 Automatic Fire Sprinklers Pty Ltd v Watson (1946) 72 CLR 435 at 454, 465-466, 178 Visscher v Giudice (2009) 239 CLR 361 at 382 [59]. 179 Laugher v Pointer (1826) 5 B & C 547 [108 ER 204]; Quarman v Burnett (1840) 6 M & W 499 [151 ER 509]; Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227 at 232-233; Queensland Stations Pty Ltd v Federal Commissioner of Taxation (1945) 70 CLR 539 at 545, 548-549, 550-552; Humberstone v Northern Timber Mills (1949) 79 CLR 389 at 396; Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 561 at 571-573; Neale v Atlas Products (Vic) Pty Ltd (1955) 94 CLR 419 at 426, 428; Federal Commissioner of Taxation v Barrett (1973) 129 CLR 395 at 400-401; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 24, 27-29. from the business of the putative employer180. Factors relevant to that second consideration have been said to include, but not to be limited to, "the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work and provision for holidays, the deduction of income tax and the delegation of work by the putative employee"181. A third consideration sometimes identified is perhaps little more than a variation of the second consideration: it is the extent to which the work done by the putative employee can be seen to be integrated into the business of the putative employer182. Each consideration is a matter of degree. None is complete in itself. Each can fairly be said to be "really posing the ultimate question in a different way rather than offering a definition which could be applied for the purpose of providing an answer"183. These considerations are compositely reflected in most standard descriptions of a relationship of employment, or of a contract of employment, at common law. In its first restatement of the law of agency, published in 1933, for example, the American Law Institute ("ALI") defined a "servant" as "a person employed to perform service for another in his affairs and who, with respect to his physical conduct in the performance of the service, is subject to the other's control or right to control"184. The ALI then went on to enumerate "matters of fact", to be considered, "among others", "[i]n determining whether one acting for another is a 180 Milligan v Wedge (1840) 12 Ad & E 737 [113 ER 993]; Allen v Hayward (1845) 7 QB 960 at 975 [115 ER 749 at 755]; Montreal v Montreal Locomotive Works Ltd [1947] 1 DLR 161 at 169; Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210 at 217; Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 39 [40]; Tattsbet Ltd v Morrow (2015) 233 FCR 46 at 61-62 [61]-[62]. 181 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 24. 182 Stevenson Jordan and Harrison Ltd v Macdonald and Evans [1952] 1 TLR 101 at 111; Bank voor Handel en Scheepvaart NV v Slatford [1953] 1 QB 248 at 295; Federal Commissioner of Taxation v Barrett (1973) 129 CLR 395 at 402; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 26-27, 35-36. 183 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 35. 184 Restatement of the Law of Agency §220. servant or an independent contractor". The ALI definition was restated in almost identical terms in 1958 and in substantially similar terms in 2006185. The ALI definition was adopted and applied by Latham CJ in Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd186. His Honour there said that the definition, including its enumeration of "matters of fact which are considered in determining whether one acting for another is a servant or an independent contractor", was "in accordance with our law"187. The definition remains in accordance with our law, notwithstanding the taxonomical shift that has since occurred through which, as a result of our preference to confine the term "agency" to its narrower sense of connoting "an authority or capacity in one person to create legal relations between a person occupying the position of principal and third parties"188, the vicarious liability of an employer for wrongs of an employee committed in the course of employment is here no longer "commonly regarded as part of the law of agency"189. Consistently with the definition it first formulated in 1933, in its more recent restatement of the law of employment, published in 2015, the ALI has sought to distil from the case law three conditions for the existence of a relationship of employment. They are that: "(1) the individual acts, at least in part, to serve the interests of the employer; (2) the employer consents to receive the individual's services; and (3) the employer controls the manner and means by which the individual renders services, or the employer otherwise effectively prevents the 185 Restatement (Second) of the Law of Agency §220; Restatement (Third) of the Law of Agency §7.07, Comment f. 186 (1944) 69 CLR 227. 187 (1944) 69 CLR 227 at 233. See also Attorney-General for NSW v Perpetual Trustee Co Ltd (1952) 85 CLR 237 at 299; Commissioner of Taxation v De Luxe Red and Yellow Cabs Co-operative (Trading) Society Ltd (1998) 82 FCR 507 at 520-521. 188 International Harvester Co of Australia Pty Ltd v Carrigan's Hazeldene Pastoral Co (1958) 100 CLR 644 at 652; Scott v Davis (2000) 204 CLR 333 at 408 [227]. See earlier Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 70. 189 Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41 at 49. See Scott v Davis (2000) 204 CLR 333 at 408-413 [227]-[239], 435 [299] (cf at 345-373 [31]-[121]); Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 at 168-172 [14]-[28]. individual from rendering those services as an independent businessperson"190. In respect of the third of those identified conditions, the ALI has elaborated191: "An individual renders services as an independent businessperson and not as an employee when the individual in his or her own interest exercises entrepreneurial control over important business decisions, including whether to hire and where to assign assistants, whether to purchase and where to deploy equipment, and whether and when to provide service to other customers." To similar effect, Professor Joellen Riley has proffered the following definition of a contract of employment or of service192: "The concept of a contract 'of service' captures the notion that the employed worker is subservient to the employer – as a servant to a master in past times – and works under their control and direction, and within an organizational structure determined by the demands of the business interests of the employer. This notion 'of service' is intended to distinguish the employee who is an integral part of the employer's enterprise from entrepreneurial workers who provide their labour as a consequence of some other commercial arrangement. The independent contractor provides labour to others while in pursuit of gains for his or her own discrete enterprise." Those definitions are useful. But an important lesson of the experience of the common law would be lost if any of them were elevated to be any more than a description of the frequently identified features of a contract of employment or a relationship of employment. The overall experience of the common law has taught "respect for the humble particular against the pretentious rational formula"193. The peculiar experience of the common law in drawing the distinction between employees and independent contractors has taught more specifically that "there is no shorthand formula or magic phrase that can be applied to find the answer, but 190 Restatement of Employment Law §1.01(a). 191 Restatement of Employment Law §1.01(b). 192 Riley, "The Definition of the Contract of Employment and Its Differentiation from Other Contracts and Other Work Relations", in Freedland et al (eds), The Contract of Employment (2016) 321 at 324. 193 Sunstein, One Case at a Time (1999) at 24, citing Dewey, How We Think and Selected Essays 1910-1911, in The Middle Works of John Dewey (1985), vol 6 at all of the incidents of the relationship must be assessed and weighed with no one factor being decisive"194. Through that case-by-case – "multi-factor"195, "multi-factorial"196 or multiple "indicia"197 – approach, the common law has shown itself to be "sufficiently flexible to adapt to changing social conditions"198. To adapt a remark of an English commentator, it may not be entirely unfair to observe that "[t]he accumulation of case law has added weight rather than wisdom"199, but it is fairer to observe that "the emphasis on various matters has shifted in response to the changing way work, and society in general, is organised" and that the "fundamental tests" have remained "more or less constant"200. Undoubtedly, the approach the common law has up till now developed will admit of results that are contestable in a marginal case. That is in the nature of any legal criterion application of which turns on evaluative judgment. Here, it is a tolerable incident of the common law's sensitivity to the diversity and vagaries of lived experience. The reality is that, for so long as employment at common law is to be understood as a category of relationship that exists in fact, "it is the totality of the relationship between the parties which must be considered"201. "The ultimate question will always be whether a person is acting as the [employee] of another or on [his or her] own behalf and the answer to that question may be indicated in ways 194 National Labor Relations Board v United Insurance Co of America (1968) 390 US 254 at 258. See also Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 195 Stewart et al, Creighton and Stewart's Labour Law, 6th ed (2016) at 204 [8.21], 206 [8.23]; Sappideen et al, Macken's Law of Employment, 8th ed (2016) at 36 [2.160]. 196 Sappideen and Vines (eds), Fleming's The Law of Torts, 10th ed (2011) at 446 197 Neil and Chin, The Modern Contract of Employment, 2nd ed (2017) at 23-24 198 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 29. 199 Freedland, The Personal Employment Contract (2003) at 20. 200 ACE Insurance Ltd v Trifunovski (2013) 209 FCR 146 at 153 [38]. 201 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 29. which are not always the same and which do not always have the same significance."202 Here, and again for reasons that will eventually be explained, the most significant indication that the relationships between Mr McCourt and Construct during the two relevant periods were relationships of employment was the degree of control that Construct ultimately had over how Mr McCourt physically performed his labour. Construct had that control through the combined operation of Mr McCourt's contractual obligations to it under the ASA and its relationship with Hanssen under the LHA. Determining the existence of a relationship of employment at common law Turning from the nature of a relationship of employment at common law to the inquiry that must be undertaken to determine whether a relationship of that nature exists, it must be frankly acknowledged that uncertainty has arisen as to the scope of the inquiry that is permissible where the contract of employment is wholly in writing. The proposition that a written contract of employment must be interpreted according to ordinary contractual principles is not in doubt. Gleeson CJ referred to the application of those ordinary principles of interpretation to a written contract of employment, and no more, when he succinctly stated in Connelly v Wells203: "Where the relationship between two persons is founded in contract, the character of the relationship depends upon the meaning and effect of the contract. In the absence of a suggestion that a contract was varied after it was originally made, its meaning and effect must be determined as at the time it was entered into. If the contract is in writing, then the court which is considering the nature of the relationship between the parties is directed to an examination of the terms of the written agreement in the light of the circumstances surrounding its making." The uncertainty that has arisen is rather as to whether the inquiry into the nature of a relationship that has been established and maintained under a written contract is limited to consideration of the terms of the contract to the exclusion of consideration of the manner of performance of the contract. 202 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 37. 203 (1994) 55 IR 73 at 74, citing Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 601. The source of the uncertainty can be traced to the decision of the Privy Council in Narich Pty Ltd v Commissioner of Pay-roll Tax204. There, just three years before the ultimate abolition of appeals to it205 and without reference to any authority other than its own decision five years earlier in Australian Mutual Provident Society v Chaplin206, the Privy Council stated three "governing principles"207: "The first principle is that, subject to one exception, where there is a written contract between the parties whose relationship is in issue, a court is confined, in determining the nature of that relationship, to a consideration of the terms, express or implied, of that contract in the light of the circumstances surrounding the making of it; and it is not entitled to consider also the manner in which the parties subsequently acted in pursuance of such contract. The one exception to that rule is that, where the subsequent conduct of the parties can be shown to have amounted to an agreed addition to, or modification of, the original written contract, such conduct may be considered and taken into account by the court. The second principle is that, while all relevant terms of the contract must be regarded, the most important, and in most cases the decisive, criterion for determining the relationship between the parties is the extent to which the person, whose status as employee or independent contractor is in issue, is under the direction and control of the other party to the contract with regard to the manner in which he does his work under it. The third principle relates to cases where the parties have ... included in their written contract an express provision purporting to define the status of the party engaged under it, either as that of employee on the one hand, or as that of independent contractor on the other. ... 'The law ... is this: if the true relationship of the parties is that of master and servant under a contract of service, the parties cannot alter the truth of that relationship by putting a different label upon it … On the other hand, if their relationship is ambiguous ..., then the parties can remove that ambiguity, by the very 204 [1983] 2 NSWLR 597. 205 Section 11 of the Australia Act 1986 (Cth). 206 (1978) 52 ALJR 407; 18 ALR 385. 207 Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 601 (emphasis added), quoting Massey v Crown Life Insurance Co [1978] 1 WLR 676; [1978] 2 All ER 576 (cleaned up). agreement itself which they make with one another. The agreement itself then becomes the best material from which to gather the true legal relationship between them.'" The third of those principles, although stated by means of a quotation from an earlier English decision, was entirely in accordance with the common law as then understood in Australia. Legal characterisation of a relationship into which parties have entered under a written contract has never been thought to be controlled by the contractual language chosen to describe the relationship. The characterisation must turn on the substantial relations between the parties, which might be informed but cannot be altered by the presence in the contract of "elaborate provisions expressed in terms appropriate to some other relation"208. Michael Black QC pithily encapsulated that understanding in an employment context in the submission that "the parties cannot create something which has every feature of a rooster, but call it a duck and insist that everybody else recognise it as a duck"209. The second principle stated by the Privy Council amounted to an adequate, albeit incomplete, exposition of the nature of a relationship of employment at common law. That topic need not be further addressed. The first principle stated by the Privy Council, in so far as it contained the italicised words, in our opinion, was wrong as a matter of common law principle and was contrary to the authority of this Court in two earlier decisions. The first was Cam & Sons Pty Ltd v Sargent210, where the primary judge was said to have been "perfectly right" in finding the relationship subsisting between parties to a written contract to have been in fact that of employer and employees in circumstances we explain in ZG Operations Australia Pty Ltd v Jamsek211. The second was R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd212, to which we will momentarily turn. The error of common law principle in Narich lay in conflation of the distinction between the relationship of employment and the contract under which 208 Cam & Sons Pty Ltd v Sargent (1940) 14 ALJ 162 at 163. 209 See Re Porter; Re Transport Workers Union of Australia (1989) 34 IR 179 at 184. 210 (1940) 14 ALJ 162 at 163. 211 [2022] HCA 2. 212 (1952) 85 CLR 138. the relationship is established and maintained. Focusing exclusively on the terms of the contract loses sight of the purpose for which the characterisation is undertaken. That purpose is to characterise the relationship. The importance of keeping, and the danger of losing, sight of the purpose for which the characterisation is undertaken being the characterisation of the relationship were highlighted by Allsop CJ in the decision under appeal. His Honour said (the emphasis being his)213: "The relationship is founded on, but not defined by, the contract's terms. Hence the importance of standing back and examining the detail as a whole … This perspective is essential to view the circumstances as a practical matter ... This perspective and proper approach to the characterisation of the whole is likely to be distorted, not advanced, by an overly weighted importance being given to emphatic language crafted by lawyers in the interests of the dominant contracting party. The distortion will likely see formal legalism of the chosen language of such party supplant a practical and intuitively sound assessment of the whole of a relationship by reference to the elements of the informing conceptions." There will be cases, of which Narich and Chaplin may well have been examples, in which an examination of the manner of performance of a written contract will reveal nothing of significance about a relationship in fact established and maintained by the parties under the contract that cannot be gleaned from an examination of the contractual terms. But there will be cases where, without any variation to the terms of a written contract, the true character of a relationship in fact established and maintained under the contract will be revealed through the manner of the performance of the contract. That will be so where the terms of the written contract are sufficiently opaque or obscure to admit of different manners of performance. And it will be especially so where such a contract is a standard form written contract couched in language that might arguably have been chosen by the putative employer to dress up the relationship to be established and maintained as something somewhat different from what it might turn out to be. That was precisely the scenario considered in Foster. There an insurance company applied in the original jurisdiction of this Court under s 75(v) of the Constitution for a writ of prohibition directed to the Commonwealth Court of Conciliation and Arbitration to restrain further proceedings in relation to an industrial award. The award had been made in respect of insurance salesmen engaged by the company under standard form written contracts which described them as agents and not employees and which stipulated that they were not subject 213 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 639-640 [21]. to the will of the company as to the manner in which they performed the duties specified in the agreement. The ground on which the company sought the writ was that the award had not arisen from an "industrial dispute" within the meaning of the Conciliation and Arbitration Act because the company and its agents did not stand in the relationship of employer and employees. The writ of prohibition was refused for the reason that, notwithstanding the terms of the written contracts, the absence of the relationship of employer and employees was not established on the evidence before the Court. Having summarised a number of the terms of the standard form written contracts, Dixon, Fullagar and Kitto JJ said214: "Provisions of this character are perhaps more likely to arouse misgivings as to what the practical situation of the agent may be in fact than to prevent a relation of master and servant being formed. For, if in practice the company assumes the detailed direction and control of the agents in the daily performance of their work and the agents tacitly accept a position of subordination to authority and to orders and instructions as to the manner in which they carry out their duties, a clause designed to prevent the relation receiving the legal complexion which it truly wears would be ineffectual." Their Honours concluded215: "The materials ... before [the] Court ... fail to exclude ... the possibility that the real relation between some or all of the agents and the ... company in their actual work, week in week out, is in fact that of employer and employee, whatever the agreement may say." Foster was applied by the Full Court of the Supreme Court of New South Wales in Ex parte Robert John Pty Ltd; Re Fostars Shoes Pty Ltd216 to hold that a "deed of licence", in the performance of which a shopkeeper was in fact given exclusive possession of shop premises, gave rise to a relationship of landlord and tenant within the jurisdiction of the fair rents board under the Landlord and Tenant (Amendment) Act 1948 (NSW), as amended. The reasoning of Sugerman J, with 214 (1952) 85 CLR 138 at 151. 215 (1952) 85 CLR 138 at 155 (note the corrigendum). 216 [1963] SR (NSW) 260. whom the other members of the Full Court agreed, is instructive217. His Honour said218: "It is not necessary to go so far as to find the document a sham. It is simply a matter of finding the true relationship of the parties." His Honour went on219: "In determining whether the fair rents board had jurisdiction to determine the fair rent of the subject premises it is necessary to have regard to the real character of the relationship of the parties if this be found, as their relations worked out in fact, to have differed from the relationship which might be taken as intended to be constituted by the deed of licence if considered alone." Since Narich, the existence of a relationship of employment at common law has been squarely considered by this Court only in Stevens v Brodribb Sawmilling Co Pty Ltd220 and Hollis v Vabu Pty Ltd221. It may be conceded that neither of those cases concerned a relationship formed under a contract wholly in writing. But it is impossible to understand the detailed factual reasoning actually engaged in by this Court in either Stevens or Hollis as confined to the identification and interpretation of contractual terms. With the possible exception of one Justice responding to the argument put in one case222, the same may be said of the reasoning in every case before Stevens and Hollis in which the existence of a relationship of employment 217 See Handley, "Sham Self-Employment" (2011) 127 Law Quarterly Review 171 at 173; Bomball, "Subsequent Conduct, Construction and Characterisation in Employment Contract Law" (2015) 32 Journal of Contract Law 149 at 167-168. 218 [1963] SR (NSW) 260 at 269. See also Pitcher v Langford (1991) 23 NSWLR 142 219 [1963] SR (NSW) 260 at 272. 220 (1986) 160 CLR 16. 221 (2001) 207 CLR 21. 222 Logan v Gilchrist (1927) 33 ALR 321 at 322 (Higgins J), but see at 322 (Isaacs J). had been in issue in this Court: contractual terms had always been examined, but never to the exclusion of contractual performance223. The explanation given by Gleeson CJ, Gaudron, Gummow, Kirby and Hayne JJ of the overarching purpose of the factual inquiry in which they engaged in Hollis also contradicts any notion that the factual inquiry in which their Honours were engaged in that case was confined to the identification and interpretation of contractual terms. Having noted a number of oral and written contractual terms, their Honours said224: "It should be added that the relationship between the parties, for the purposes of this litigation, is to be found not merely from these contractual terms. The system which was operated thereunder and the work practices imposed by Vabu go to establishing 'the totality of the relationship' between the parties; it is this which is to be considered." Later, their Honours said225: "The concern here is with the bicycle couriers engaged on Vabu's business. A consideration of the nature of their engagement, as evidenced by the documents to which reference has been made and by the work practices imposed by Vabu, indicates that they were employees." The work practices identified as bearing on that characterisation included that the couriers "were not providing skilled labour or labour which required special 223 Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41; Cam & Sons Pty Ltd v Sargent (1940) 14 ALJ 162; Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227; Queensland Stations Pty Ltd v Federal Commissioner of Taxation (1945) 70 CLR 539; Humberstone v Northern Timber Mills (1949) 79 CLR 389; R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138; Wright v Attorney-General for the State of Tasmania (1954) 94 CLR 409; Neale v Atlas Products (Vic) Pty Ltd (1955) 94 CLR 419; Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 561; Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210; Federal Commissioner of Taxation v Barrett (1973) 129 CLR 395; Dietrich v Dare (1980) 54 ALJR 388; 30 ALR 407. 224 (2001) 207 CLR 21 at 33 [24], quoting from Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 29. 225 (2001) 207 CLR 21 at 42 [47]. qualifications"226, that they "had little control over the manner of performing their work"227, that they "were presented to the public and to those using the courier service as emanations of Vabu"228, that "Vabu superintended the couriers' finances"229 and that "there was considerable scope for the actual exercise of control" over the couriers in the running of Vabu's business230. Faced with contracts wholly in writing, some trial and intermediate appellate courts in Australia have done their best to limit their analysis to the identification and interpretation of contractual terms in conformity with the approach indicated in Narich. In so doing, they have sometimes been driven to engage in the rather artificial exercise of treating conduct engaged in by the parties in the performance of the contract as a "course of dealing" from which then to infer a mutual intention to supplement the written contract with further contractual terms making more specific provision for the conduct found in fact to have occurred231. Mostly, however, trial and intermediate appellate courts have taken their cue from Stevens and Hollis in assuming that, despite what was said in Narich, "the nature of the relationship may be legitimately examined by reference to the actual way in which work was carried out"232. The assumption was explicit in the reasoning of the Full Court of the Federal Court in the decision here under appeal233. It was also explicit in the reasoning of the Full Court of that Court in the decision under appeal in ZG Operations Australia Pty Ltd v Jamsek234. 226 (2001) 207 CLR 21 at 42 [48]. 227 (2001) 207 CLR 21 at 42 [49]. 228 (2001) 207 CLR 21 at 42 [50]. 229 (2001) 207 CLR 21 at 43 [54]. 230 (2001) 207 CLR 21 at 44 [57]. 231 eg Lenzoot Haulage Pty Ltd v Sinclair (1986) 42 SASR 506 at 515. 232 ACE Insurance Ltd v Trifunovski (2013) 209 FCR 146 at 168-169 [91]. 233 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 637 [11], 661 [98]. 234 [2022] HCA 2, on appeal from Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 118 [9], 119 [14], 147-148 [182]-[184]. No doubt inspired by aspects of the reasoning in WorkPac, the focus of the arguments on the hearing of the appeal in this Court was on a close examination of the terms of the ASA. That said, it is not insignificant that no party was able to avoid making reference to the manner of performance of the ASA and to its interaction with the manner of performance of the LHA. The reticence of the parties to engage with the manner of the performance of the ASA and its interaction with the manner of the performance of the LHA was, in our opinion, unwarranted. As has already been noted, WorkPac held only that the distinction between a casual employee and another employee was to be found in the terms of the contract of employment. The plurality was not laying down any principle directed to the distinction between an employee and an independent contractor235. The assumption on which lower courts have mostly proceeded is, in our opinion, correct. The italicised words in the first of the three principles stated by the Privy Council in Narich did not accord with the prevailing understanding of the common law in Australia when Narich was decided. To the extent of the inclusion of those words, that first principle was wrong when Narich was decided. That principle has not grown to be either correct or workable with age: it should not be accepted to be part of the common law of Australia. The true principle, in accordance with what we understand to have been the consistent doctrine of this Court until now, is that a court is not limited to considering the terms of a contract and any subsequent variation in determining whether a relationship established and maintained under that contract is a relationship of employment. The court can also consider the manner of performance of the contract. That has been and should remain true for a relationship established and maintained under a contract that is wholly in writing, just as it has been and should remain true for a relationship established and maintained under a contract expressed or implied in some other form or in multiple forms. The relationships of employment at common law in this case Having to this stage established that the inquiry at common law is into the legal character of the relationship that existed in fact between Mr McCourt and Construct during the two relevant periods and that the scope of the inquiry informing the legal characterisation of the relationship legitimately extends to the manner of the performance of the ASA, including its interaction with the manner 235 See (2021) 95 ALJR 681 at 700 [101]; 392 ALR 39 at 61. of the performance of the LHA, it is now necessary to undertake that characterisation. The first point to be made is that Mr McCourt and Construct did not establish a continual relationship under which Mr McCourt was to perform work merely by entering into the ASA. The ASA obliged Construct to use reasonable endeavours to keep itself informed of opportunities in the building industry for Mr McCourt to supply labour to builders identified by Construct236, obliged Construct to inform Mr McCourt of opportunities to supply his labour to builders237, and entitled Construct to negotiate a payment rate for the supply of Mr McCourt's labour to a builder238. The ASA equally entitled Mr McCourt to refuse to take up an opportunity to supply his labour to any builder239. No continual relationship under which Mr McCourt was to perform work was established under the terms of the ASA until Construct informed Mr McCourt of an opportunity to supply his labour to a builder and Mr McCourt chose to take up that opportunity. The continual relationship under which Mr McCourt was to perform work was then one which the ASA contemplated would be maintained for so long as Mr McCourt's labour was required by the builder240 subject to an ability of Mr McCourt to terminate the relationship at any time on four hours' notice to Construct241. Only on the two occasions when Mr McCourt in fact took up an opportunity to supply his labour to Hanssen was a continual relationship of that nature in fact established. Following the exchange that occurred between Mr McCourt and Construct on 26 July 2016, the first relationship of that nature was established and maintained during the period from 27 July 2016 to 6 November 2016. Mr McCourt then went travelling around Australia. Following his return to Perth, the second relationship of that nature was established and maintained during the period from 236 Clause 1(a) of the ASA. 237 Clause 1(b) of the ASA. 238 Clause 2(a) of the ASA. 239 Clause 5(b) of the ASA. 240 Clause 4(c) of the ASA. 241 Clause 5(c) of the ASA. 14 March 2017 to 30 June 2017, after which Hanssen appears no longer to have required Mr McCourt's labour. During each of those two periods in which a continual relationship under which Mr McCourt was to perform work existed, Mr McCourt was obliged under the ASA to attend Hanssen's building site and there to supply his labour to Hanssen in a "safe, competent and diligent manner"242. He was obliged to ensure that accurate records were maintained of his hours of labour243. Construct was in turn obliged, on presentation of an invoice by Mr McCourt, to "underwrite" payment to Mr McCourt of the rate Construct had negotiated with Hanssen244. Of course, Mr McCourt never in fact kept any record and Construct never in fact insisted on him presenting any invoice before paying him. Whether acquiescence of the parties in that practice might be analysed in terms of contractual variation or waiver or estoppel by convention is of no present significance. What is of significance is that, in the performance of each relationship between Mr McCourt and Construct that was in fact established and maintained under the ASA, Mr McCourt turned up at Hanssen's building site each morning, where he clocked on. During the day, he did whatever he was told to do in the way he was told to do it by Hanssen's site managers and leading hands. He then clocked off at the end of the day. Each week, he received from Construct, by direct debit into his bank account, an amount which represented the hourly rate of pay Construct had negotiated for his labour with Hanssen. The hours he had worked and the amount he was paid were recorded on a "payment advice" which Construct then gave to him. That pattern of work and that method of payment were explained by the terms and manner of the performance of the LHA. Under the terms of the LHA, Hanssen was able to place an order with Construct for labour. Construct was then to arrange for workers to present themselves at Hanssen's building site. The workers were there to be "under [Hanssen's] direction and supervision from the time they report[ed] to [Hanssen] and for the duration of each day on the assignment"245. Hanssen was to pay Construct, and Construct was to pay the 242 Clause 4(c) of the ASA. 243 Clause 4(b) of the ASA. 244 Clause 1(d) of the ASA. 245 Clause 4 of the LHA. workers, for their hours worked246. That was essentially what occurred in practice in respect of the provision by Construct to Hanssen of the labour of Mr McCourt. Although there are salient distinctions which will be noted in due course, the back-to-back operation of the contract between Mr McCourt and Construct (the ASA) and the contract between Construct and Hanssen (the LHA) was in important respects not dissimilar to the triangular labour hire arrangement considered by this Court in Accident Compensation Commission v Odco Pty Ltd ("Odco [No 1]")247. Adapting language used by this Court to describe the arrangement in that case to the circumstances of this case, it can be seen that Mr McCourt worked under the ASA for the benefit of Construct, in the sense that his work was done for the purposes of Construct's business and enabled Construct to obtain payment from Hanssen under the LHA, which in turn enabled Construct to pay Mr McCourt under the ASA248. By supplying his labour to Hanssen for the purposes of Hanssen's business, Mr McCourt was at the same time supplying his labour to Construct for the purposes of Construct's business249. The issue in Odco [No 1] was whether a labour hire company was liable to pay a levy under an extended statutory definition of "employer" in the Accident Compensation Act 1985 (Vic). No issue was raised in the appeal to this Court in Odco [No 1] about whether the labour hire arrangement considered in that case gave rise to any relationship of employment at common law. The assumption on which the appeal was conducted was that it did not250. Issues about whether the labour hire arrangement considered in Odco [No 1] gave rise to a relationship of employment at common law were addressed in separate proceedings before the Federal Court, both at first instance251 and on appeal in Building Workers' Industrial Union of Australia v Odco Pty Ltd ("Odco [No 2]")252. The resolution 246 Clause 9 of the LHA. 247 (1990) 64 ALJR 606; 95 ALR 641. 248 (1990) 64 ALJR 606 at 610; 95 ALR 641 at 647. 249 (1990) 64 ALJR 606 at 613; 95 ALR 641 at 652. 250 (1990) 64 ALJR 606 at 609; 95 ALR 641 at 646. 251 Odco Pty Ltd v Building Workers' Industrial Union of Australia (unreported, Federal Court of Australia, 24 August 1989). 252 (1991) 29 FCR 104. of those issues was that the arrangement did not give rise to a relationship of employment at all253. Not very long afterwards, Odco [No 2] was distinguished by the Victorian Court of Appeal in Drake Personnel Ltd v Commissioner of State Revenue254. There the putative employer was an employment agency described as being in the business of supplying "temporary workers" to its clients, who were entitled to and did exercise day-to-day control over the work of those temporary workers. The submission accepted by the Victorian Court of Appeal was to the effect that the exercise by the client of day-to-day control over the work of a temporary worker was properly "referred back" to the contract between the agency and the temporary worker for the purpose of characterising the relationship between them at common law. Working for the purposes of the agency's business, being paid by the agency, and being subject to day-to-day control by reference to the contractual arrangement between the agency and the client, a temporary worker was an employee of the agency255. The approach taken by the Victorian Court of Appeal in Drake Personnel – attributing significance to the back-to-back contracts, between the temporary workers and the employment agency and between the agency and its client, in assessing the control that the agency had over the manner in which the temporary workers performed their work – was sound in principle. The approach is preferable to the rival approach taken five years later by the English Court of Appeal in Bunce v Postworth Ltd256, on which Construct sought to rely in argument for its persuasive value. The reasoning in Bunce is conspicuously unpersuasive. Out of a professed and entirely proper concern to establish "who in reality [had] the power to control what the worker [did] and how he [did] it"257, Bunce actually produced the result that a worker over whose day-to-day work a power of control was in reality exercised through the operation of back-to-back contracts between him and an employment agency and between the agency and its client was treated as the employee of neither the agency nor its client. Of the rival approaches, Drake Personnel produces a result that accords with reality; Bunce does not. 253 (1991) 29 FCR 104 at 127. 255 (2000) 2 VR 635 at 638-639 [4], 657-658 [55]-[56], 665 [78]. 256 [2005] IRLR 557. 257 [2005] IRLR 557 at 561 [29] (emphasis in original). The Drake Personnel approach was correctly applied by E M Heenan J in dissent in Personnel Contracting Pty Ltd v Construction, Forestry, Mining and Energy Union of Workers258 to find that labour hire arrangements into which Construct had entered of a kind similar to the arrangement in the present case gave rise to relationships of employment between Construct and workers. The dissent is to be preferred to the decision of the majority in that case. That is not to cast doubt on the correctness of Odco [No 2]. There are three important distinctions between the triangular labour hire arrangements considered in Odco [No 1] and Odco [No 2] and the arrangements in Drake Personnel, Personnel Contracting and the present case. First, the subject-matter of the back- to-back standard form contracts in Odco [No 1] and Odco [No 2] was not unambiguously hourly labour. The subject-matter was described contractually not just as "hourly" labour but also in terms of a "job" or "work done"259. The way in which the issue about employment at common law was joined between the parties in Odco [No 2] did not engage the Full Court of the Federal Court in any examination of potential differences in the performance of the contracts. Second, the contracts between the putative employees and the labour hire company in those cases did not oblige, as here, the putative employees to supply labour in a "safe, competent and diligent manner" but rather to "carry out all work" which the putative employees agreed with the clients of the labour hire company to do and which the putative employees "guaranteed against faulty workmanship"260. Third, and most importantly, nothing in the contracts between the labour hire company and its clients purported to place the putative employees under the direction and control of the clients261. The aspects of the relationship that existed in fact between Mr McCourt and Construct during each of the two relevant periods most pertinent to the legal characterisation of the relationship can be summarised as follows. First, Mr McCourt was engaged by Construct under the ASA to supply nothing but his labour to Hanssen, which he in fact did and for which he was paid an agreed hourly rate by Construct. Second, by supplying his labour to Hanssen, Mr McCourt was at the same time supplying his labour to Construct for the purposes of Construct's business. He was not in any meaningful sense in business for himself. Third, and most importantly, when supplying his labour to Hanssen, Mr McCourt was subject to the direction and control of Hanssen through the back-to-back operation of his 258 (2004) 141 IR 31 at 44 [52]. 259 (1991) 29 FCR 104 at 110. 260 (1991) 29 FCR 104 at 110. 261 (1991) 29 FCR 104 at 110-113. obligation to Construct under the ASA and Construct's obligation to Hanssen under the LHA. Those aspects of the relationship made it a relationship of employment. Conclusion The conclusion that Mr McCourt was an employee of Construct during the two relevant periods is the conclusion to which the Full Court would have come in the decision under appeal were it not for the Full Court's inability to assess Personnel Contracting to have been "plainly wrong". That is clear from its reasoning262. In adopting the approach that it did, the Full Court conducted itself in a manner befitting its position as an intermediate appellate court within an integrated national legal system. The error in its conclusion is entirely without fault on its part. The appeal must be allowed. The orders proposed by Kiefel CJ, Keane and Edelman JJ must be made. 262 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 642 [31], 643-644 [33]-[40], 644 [41], 161 GORDON J. The central question is whether Mr McCourt was "employed, or usually employed" by a "national system employer" (Personnel Contracting Pty Ltd, trading as "Construct") so as to be a "national system employee" for the purposes of ss 13 and 14 of the Fair Work Act 2009 (Cth) ("the Act"). In Pt 1-2 of the Act, which contains ss 13 and 14, "employee" and "employer" have their "ordinary meanings"263. There was no dispute that the "ordinary meanings" of employee and employer in the Act are the common law meanings of those terms264. The Act makes minor statutory amendments to the common law meanings265, none of which were at issue in this appeal. The resolution of the central question requires consideration of the totality of the relationship between Construct and Mr McCourt, which must be determined by reference to the legal rights and obligations that constitute that relationship. Where the parties have entered a wholly written employment contract, as in this case, the totality of the relationship which must be considered is the totality of the legal rights and obligations provided for in the contract, construed according to the established principles of contractual interpretation. In such a case, the central question neither permits nor requires consideration of subsequent conduct and is not assisted by seeing the question as involving a binary choice between employment and own business. The totality of the relationship between Construct and Mr McCourt was that of employer and employee. Background Mr McCourt arrived in Australia in June 2016 on a working holiday visa, having previously worked in the United Kingdom as a part-time brick-layer and in hospitality jobs. While looking for work in Western Australia, Mr McCourt obtained a "white card", which he needed to work on construction sites. 263 Act, s 11. 264 Australia, House of Representatives, Fair Work Bill 2008, Explanatory Memorandum at 5 [28]. See Aid/Watch Inc v Federal Commissioner of Taxation (2010) 241 CLR 539 at 549 [23]. 265 Section 15(1)(a) provides that a reference in the Act to an employee with its ordinary meaning "includes a reference to a person who is usually such an employee". See Australia, House of Representatives, Fair Work Bill 2008, Explanatory Memorandum at 11 [67]. Section 14(1) limits the meaning of "national system employer" to, among other things, constitutional corporations, the Commonwealth and Commonwealth authorities, so far as they employ or usually employ an individual; and also persons, so far as they, in connection with constitutional trade or commerce, employ or usually employ an individual as a flight crew officer, maritime employee or waterside worker. Mr McCourt contacted Construct, which described itself as a labour hire company, to express interest in obtaining work. During an interview at Construct's office on 25 July 2016, Mr McCourt indicated that he was prepared to do any construction labouring that he was capable of and to work on weekends; that he had his own means of transport to get to jobs; that he was available to start work immediately; and that he had a hard hat, steel-capped boots and hi-vis clothing. Mr McCourt was informed of the rate at which he would be paid and was given an "Administrative Services Agreement" ("the ASA"), a "Most Frequently Asked Questions" document, a "Contractor Safety Induction Manual" and a document entitled "Guide to Work at a Glance". The contract between Construct and Mr McCourt was wholly in writing. The terms of the contract were set out in the ASA, supplemented by the Contractor Safety Induction Manual, which was found by the Full Court of the Federal Court of Australia to be "contractual in nature". Mr McCourt signed the ASA on the day of his interview. The terms of the ASA are addressed later in these reasons. The ASA made separate provision for the rights and obligations of each party. No one suggested that the written contract between Mr McCourt and Construct was subsequently varied or that it was a sham. On 26 July 2016, the day after the interview, Construct informed Mr McCourt that there was work at a site run by Hanssen Pty Ltd ("Hanssen"), "the Concerto Project", and that the work would start the following day and would likely run until at least Christmas. Mr McCourt confirmed that he was happy to commence work the next day. Construct's relationship with Hanssen was governed by a "Labour Hire Agreement" ("the LHA"). The LHA described Construct as "an administrative services agency, liaising between the client [ie, Hanssen] and self-employed contractors for the provision of labour by self-employed contractors to the client"266. Under the LHA, among other things: Construct's "contractors" were "referred on a daily hire basis" and charged out "on flat hourly rates" negotiated between Hanssen and Construct267, the minimum period of hire was four hours on any given day (subject to specified exceptions)268, and the contractors were subject to Hanssen's 266 LHA, cl 1. 267 LHA, cl 3. 268 LHA, cl 6. "direction and supervision from the time they report[ed] to [Hanssen] and for the duration of each day on the assignment"269. Construct agreed to invoice Hanssen on a weekly basis (including amounts due, with regard to the agreed charge-out rate and the hours or pieces completed)270 and, if notified by Hanssen of the unsuitability of a "contractor" within four hours on the first day of an assignment, to not charge for the contractor and to replace them as soon as practicable271. (3) Hanssen agreed to "comply with all applicable workplace health and safety laws, codes and standards applicable to self-employed contractors"272; "not to employ or contract" any contractor referred by Construct, "either directly or indirectly through an interposed entity, within twelve months of their commencement of work" with Hanssen273; to ensure that a weekly schedule of units (with hours or pieces completed by each Construct contractor per week) was accurately compiled and sent to Construct in a specified manner and by a specified time274; and to pay invoices received from Construct within seven days275. On 27 July 2016, Mr McCourt arrived at the Concerto Project and participated in a site induction. During the induction, he was given a Hanssen site safety induction form and the Hanssen site rules. No contract existed between Mr McCourt and Hanssen. Mr McCourt worked at the Concerto Project from 27 July 2016 to 6 November 2016. After finishing work at the Concerto Project in November 2016, Mr McCourt left Perth temporarily. He returned in March 2017. On 9 March 2017, Mr McCourt contacted Ms O'Grady, the "Finishing Foreman" at the Concerto Project, to ask if there was any work available. He resumed work at the Concerto Project on 14 March 2017 and continued until 24 June 2017. Mr McCourt subsequently worked at another Hanssen site, "the Aire Project", from 26 June 2017 to 30 June 2017. On 30 June 2017, Mr McCourt was informed 269 LHA, cl 4. 270 LHA, cl 9. 271 LHA, cl 1. 272 LHA, cl 2. 273 LHA, cl 7. 274 LHA, cl 8. 275 LHA, cl 9. that he was not to go back to the Aire Project to work. Mr McCourt did not receive any further work from Construct. Mr McCourt and the Construction, Forestry, Maritime, Mining and Energy Union ("the CFMMEU") brought claims against Construct and Hanssen under ss 545, 546 and 547 of the Act for orders for compensation and penalties. They alleged that Mr McCourt was not paid or treated according to the Building and Construction General On-Site Award 2010 ("the Award"). Mr McCourt was only entitled to be paid under the Award if he was an "employee" of Construct under the Act. The meaning of employee and employer As we have seen, there was no dispute that the "ordinary meanings" of employee and employer in the Act are the common law meanings of those terms and that the Act recognises that those terms have legal content. In deciding whether a relationship between two parties is one of employment, it is the "totality of the relationship" which must be considered276. That approach must be understood in light of the view, recently re-affirmed by six judges of this Court in WorkPac Pty Ltd v Rossato277, that "[a] court can determine the character of a legal relationship between the parties only by reference to the legal rights and obligations which constitute that relationship" (emphasis added). In modern times, those legal rights and obligations derive from a contract of employment. That is because "[t]he employment relationship, in Australia, operates within a legal framework defined by statute and by common law principles, the contract of employment"278. Indeed, the evolution of the employment relationship is "a classic the construction and content of informing 276 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 29; Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 33 [24], 41 [44]; Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 at 123-124 [81]. See also Logan v Gilchrist (1927) 33 ALR 321 at 322; Queensland Stations Pty Ltd v Federal Commissioner of Taxation (1945) 70 CLR 539 at 552; Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 561; Marshall v Whittaker's Building Supply Co (1963) 109 CLR 210 at 218; Federal Commissioner of Taxation v Barrett (1973) 129 CLR 395 at 401. 277 (2021) 95 ALJR 681 at 693 [57]; 392 ALR 39 at 52; see also 95 ALJR 681 at 699 [97]; 392 ALR 39 at 60, citing R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138 at 151. 278 WorkPac (2021) 95 ALJR 681 at 693 [56]; 392 ALR 39 at 52, quoting Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 178 [1]. The idea that the character of a legal relationship between parties depends entirely or illustration of the shift from status (that of master and servant) to that of contract (between employer and employee)"279. It follows that, in the case of a wholly written employment contract, the "totality of the relationship" which must be considered is the totality of the legal rights and obligations provided for in the contract280. To ascertain those legal rights and obligations the contract in issue must be construed according to the established principles of contractual interpretation281. The statutory command to give "employee" and "employer" their ordinary meanings requires no less and permits no more282. The task is to construe and characterise the contract made between the parties at the time it was entered into283. The nature of the contracting parties, such as where a contracting party is a separate entity or a partnership, rather than an individual, may suggest that the relationship between the parties is not that of employer and employee284. The way that the contractual terms address the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work, the provision for holidays, the delegation of work, and substantially on the practical assumption of direction and control does not reflect the law in Australia: cf Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41 at 48; Attorney-General for NSW v Perpetual Trustee Co Ltd (1952) 85 CLR 237 at 249, 299; Foster (1952) 85 CLR 138 at 151, 155; R v Alley; Ex parte NSW Plumbers & Gasfitters Employees' Union (1981) 153 CLR 376 at 392-393, 397; see also Bunce v Postworth Ltd [2005] IRLR 557 at 561 [29]. 279 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 436; Barker (2014) 253 CLR 169 at 182-183 [16]; WorkPac (2021) 95 ALJR 681 at 693 [58]; 392 ALR 39 at 52. 280 See fn 276 above. 281 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 352; Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 601; Connelly v Wells (1994) 55 IR 73 at 74; Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35]; Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 116-117 [46]-[52]. 282 Act, s 11 read with ss 13 and 14. 283 See, eg, Connelly (1994) 55 IR 73 at 74. 284 See, eg, Australian Mutual Provident Society v Chaplin (1978) 52 ALJR 407 at 410; 18 ALR 385 at 391; Hollis (2001) 207 CLR 21 at 48-49 [68]. where the right to exercise direction and control resides may together show that the relationship is not one of employer and employee285. Recourse may be had to events, circumstances and things external to the contract which are objective, which are known to the parties at the time of contracting and which assist in identifying the purpose or object of the contract286. The nature of the specific job that the purported employee applied for as well as the nature and extent of the equipment to be supplied by that purported employee for that particular job may well be relevant to the question of characterisation of the contract287. Indeed, it is often relevant, but not determinative, to observe that the purported employee must supply some uniform, tools or equipment288. But again that observation must be made in context. The context is the nature and extent of what is required to be provided under the contract. In many forms of employment, employees provide their own uniform and bring their own tools to work. One "general principle" of construction of contracts is that "it is not legitimate to use as an aid in the construction of [a] contract anything which the parties said or did after it was made"289 (what might be described as "subsequent 285 cf Stevens (1986) 160 CLR 16 at 24. See, eg, Queensland Stations (1945) 70 CLR 286 Codelfa (1982) 149 CLR 337 at 350, 352; Mount Bruce Mining (2015) 256 CLR 104 at 117 [50]. See also Prenn v Simmonds [1971] 1 WLR 1381 at 1385; [1971] 3 All ER 237 at 241; Reardon Smith Line Ltd v Yngvar Hansen-Tangen [1976] 1 WLR 989 at 996; [1976] 3 All ER 570 at 574-575, citing Lewis v Great Western Railway Co (1877) 3 QBD 195 at 208; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 429; Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 596 at 606. 287 See, eg, Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227 at 231-232. 288 See, eg, Stevens (1986) 160 CLR 16 at 24, 25, 37; Hollis (2001) 207 CLR 21 at 41 289 Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570 at 582 [35], quoting James Miller & Partners Ltd v Whitworth Street Estates (Manchester) Ltd [1970] AC 583 at 603, repeated in Administration of Papua and New Guinea v Daera Guba (1973) 130 CLR 353 at 446. See also Chaplin (1978) 52 ALJR 407 at 411; 18 ALR 385 at 392; Codelfa (1982) 149 CLR 337 at 348, quoting L Schuler AG v Wickman Machine Tool Sales Ltd [1974] AC 235 at 261. conduct"290). The rationale of the general principle, identified by Lord Reid in James Miller & Partners Ltd v Whitworth Street Estates (Manchester) Ltd291, is to avoid the result "that a contract meant one thing the day it was signed, but by reason of subsequent events meant something different a month or a year later". The general principle may permit exceptions292. No party contended that any exception should be recognised in this appeal. Of course, the general principle against the use of subsequent conduct in construing a contract wholly in writing says nothing against the admissibility of conduct for purposes unrelated to construction, including in relation to: (1) formation – to establish whether a contract was actually formed and when it was formed293; (2) contractual terms – where a contract is not wholly in writing, to establish the existence of a contractual term or terms294; (3) discharge or variation – to demonstrate that a subsequent agreement has been made varying one 290 See Seddon and Bigwood, Cheshire and Fifoot Law of Contract, 11th Aust ed (2017) at 448 [10.16]; Herzfeld and Prince, Interpretation, 2nd ed (2020) at 601 [29.150]. This is also sometimes referred to as "post-contractual conduct" or "extrinsic evidence". 291 [1970] AC 583 at 603. See also Bacchus Marsh Concentrated Milk Co Ltd (In liq) v Joseph Nathan & Co Ltd (1919) 26 CLR 410 at 451-452, cited in Seddon and Bigwood, Cheshire and Fifoot Law of Contract, 11th Aust ed (2017) at 424 [10.4]. See also Codelfa (1982) 149 CLR 337 at 347-348; Equuscorp Pty Ltd v Glengallan Investments Pty Ltd (2004) 218 CLR 471 at 483-484 [35]. 292 Daera Guba (1973) 130 CLR 353 at 446; L Schuler [1974] AC 235 at 261; Equuscorp (2004) 218 CLR 471 at 483-484 [35]. See also Herzfeld and Prince, Interpretation, 2nd ed (2020) at 601 [29.150]. 293 Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153 at 163-164 [25], citing, among other cases, Howard Smith & Co Ltd v Varawa (1907) 5 CLR 68 at 77 and Barrier Wharfs Ltd v W Scott Fell & Co Ltd (1908) 5 CLR 647 at 668, 669, 672; Franklins Pty Ltd v Metcash Trading Ltd (2009) 76 NSWLR 603 at 616 [13]; GC NSW Pty Ltd v Galati [2020] NSWCA 326 at [92]. See, eg, Humberstone v Northern Timber Mills (1949) 79 CLR 389 at 398, 403; Neale v Atlas Products (Vic) Pty Ltd (1955) 94 CLR 419 at 426-428; Zuijs (1955) 93 CLR 561 at 567-568, 294 Byrne (1995) 185 CLR 410 at 442. See, eg, Humberstone (1949) 79 CLR 389 at 398, 403; Humberstone v Northern Timber Mills [1949] VLR 351 at 357-358; Neale (1955) 94 CLR 419 at 426-428; Zuijs (1955) 93 CLR 561 at 567-568, 575; Marshall (1963) 109 CLR 210 at 212, 218; Barrett (1973) 129 CLR 395 at 400 but see also Barrett v Federal Commissioner of Taxation 72 ATC 457 at 460-461. or more terms of the original contract295; (4) sham – to show that the contract was a "sham" in that it was brought into existence as "a mere piece of machinery" to serve some purpose other than that of constituting the whole of the arrangement296; and (5) other – to reveal "probative evidence of facts relevant to rectification, estoppel or any other legal, equitable or statutory rights or remedies that may impinge on an otherwise concluded, construed and interpreted contract"297. The relevance of subsequent conduct for the purposes of a particular statutory provision, legislative instrument or award was not in issue in this appeal. It is necessary to say something further about the admissibility of conduct. Where a wholly written contract has expired but the parties' conduct suggests that there was an agreement to continue dealing on the same terms, a contract may be implied on those terms (save as to duration and termination)298. The parties' conduct may also demonstrate "a tacit understanding or agreement" sufficient to show that there was a contract in the absence of an earlier express contract299. In a dynamic relationship where "new terms [may] be added or [may] supersede older 295 Phillips v Ellinson Brothers Pty Ltd (1941) 65 CLR 221 at 243-244; Humberstone (1949) 79 CLR 389 at 398; Humberstone [1949] VLR 351 at 357-358; Zuijs (1955) 93 CLR 561 at 567-568; Tallerman & Co Pty Ltd v Nathan's Merchandise (Victoria) Pty Ltd (1957) 98 CLR 93 at 112-113; Chaplin (1978) 52 ALJR 407 at 411; 18 ALR 385 at 392-393; ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue (NSW) (2012) 245 CLR 338 at 350-351 [31]-[32]. See also Chitty on Contracts, 33rd ed (2018), vol 1 at 1087 [13-124], citing Goss v Lord Nugent (1833) 5 B & Ad 58 at 64 [110 ER 713 at 716] and Morris v Baron and Company [1918] 296 Raftland Pty Ltd v Federal Commissioner of Taxation (2008) 238 CLR 516 at 531 [34]-[35]. See also Cam and Sons Pty Ltd v Sargent (1940) 14 ALJ 162 at 163; Foster (1952) 85 CLR 138 at 144, 153-154. 297 Franklins (2009) 76 NSWLR 603 at 616 [13]. See also Herzfeld and Prince, Interpretation, 2nd ed (2020) at 601 [29.160]. 298 Brambles Ltd v Wail (2002) 5 VR 169 at 184-189 [54]-[62]; CSR Ltd v Adecco (Australia) Pty Ltd [2017] NSWCA 121 at [88]-[118]. A majority of the High Court allowed an appeal from Brambles on a different point and considered that it was not necessary to address the question whether the contractual terms relied on continued in force after their formal expiry: Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424 at 438 [29]. 299 Integrated Computer Services Pty Ltd v Digital Equipment Corp (Aust) Pty Ltd (1988) 5 BPR 11,110 at 11,117, quoted in Brambles Holdings (2001) 53 NSWLR terms", it may also be necessary "to look at the whole relationship and not only at what was said and done when the relationship was first formed"300. The reference to the "whole relationship" should not be misunderstood. The inquiry remains an objective inquiry301 the purpose of which is to ascertain the terms the parties can be taken to have agreed302. It is not an approach directed to inquiring into the conduct of parties which is not adduced to establish the formation of the contract or the terms on which the parties contracted. The decision in R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd303 is instructive. It was an application for an order nisi for a writ of prohibition directed to three judges of the Commonwealth Court of Conciliation and Arbitration ("the Arbitration Court") to restrain further proceedings in relation to an industrial award304. The award had been made in respect of adults engaged by an insurance company to sell insurance under a standard form agreement. This Court refused relief. It refused relief because there was a live issue that the standard form agreement was a sham305. The Court expressly decided not to determine that issue306. Whether a particular adult engaged by the insurance company was or was not an employee was a matter to be determined by the Arbitration Court. In particular, references to what was happening "in practice"307 were provoked by and addressing the allegation of sham and, no less significantly, seeking to explain why the High Court could not resolve that issue. Foster illustrates the necessity of identifying the precise question being 300 Integrated Computer Services (1988) 5 BPR 11,110 at 11,118, quoted in PRA Electrical Pty Ltd v Perseverance Exploration Pty Ltd (2007) 20 VR 487 at 489 [5]. 301 See, eg, Meates v Attorney-General [1983] NZLR 308 at 377, quoted in Vroon BV v Foster's Brewing Group Ltd [1994] 2 VR 32 at 82. See also Codelfa (1982) 149 CLR 337 at 353; PRA (2007) 20 VR 487 at 489 [6]. 302 Integrated Computer Services (1988) 5 BPR 11,110 at 11,117-11,118, quoted in Brambles Holdings (2001) 53 NSWLR 153 at 177 [74], 178 [77]. 303 (1952) 85 CLR 138. 304 Foster (1952) 85 CLR 138 at 149. 305 Foster (1952) 85 CLR 138 at 144, 153-154, 155. 306 Foster (1952) 85 CLR 138 at 144, 155. 307 Foster (1952) 85 CLR 138 at 151. addressed – there, a question of sham – and the relevance of evidence and statements of judicial principle to that question. In construction of an employment contract it is not necessary to ask whether the purported employee conducts their own business308. That is, the inquiry is not to be reduced to a binary choice between employment or own business. The question must always focus on the nature of the relationship created by the contract between the parties. Asking whether a person is working in their own business may not always be a suitable inquiry for modern working relationships. It may not take very much for a person, be they low-skilled or otherwise, to be carrying on their own business309. The reality of modern working arrangements, the gig economy, and the possibility that workers might work in their own business as well as one or more other businesses in the same week, suggest that focusing the analysis on "own business" considerations distracts attention from the relevant analysis – whether the totality of the relationship created by contract between the person and a purported employer is one of employee and employer310. The parties to, and the terms of, the contract may show that the purported employee entered into the contract as part of their own business. Another reason for not asking whether a person is carrying on a business of their own is that that inquiry will ordinarily direct attention to matters which are not recorded in the contract, such as what "the parties said or did after it was made"311. For instance, in Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd312, North and Bromberg JJ said that some of the "hallmarks of a business" 308 Stevens (1986) 160 CLR 16 at 27-28; Oceanic Crest Shipping Co v Pilbara Harbour Services Pty Ltd (1986) 160 CLR 626 at 639. See also Montreal v Montreal Locomotive Works Ltd [1947] 1 DLR 161 at 169. 309 See, eg, Federal Commissioner of Taxation v Stone (2005) 222 CLR 289 at 305 [55]. See also G v Commissioner of Inland Revenue [1961] NZLR 994 at 999. 310 See Tattsbet Ltd v Morrow (2015) 233 FCR 46 at 61 [61]. 311 Gardiner (2008) 238 CLR 570 at 582 [35], quoting James Miller & Partners [1970] AC 583 at 603, repeated in Daera Guba (1973) 130 CLR 353 at 446. See, eg, United States v Silk (1947) 331 US 704 at 713; Market Investigations Ltd v Minister of Social Security [1969] 2 QB 173 at 185. 312 (2015) 228 FCR 346 at 390 [179], quoting On Call Interpreters and Translators Agency Pty Ltd v Federal Commissioner of Taxation [No 3] (2011) 214 FCR 82 at are conducting a commercial enterprise "as a going concern", the "acquisition and use of both tangible and intangible assets in the pursuit of profit", the "notion of system, repetition and continuity", and "operat[ing] in a business-like way". But, unless those matters are provided for in the contract, they are not relevant and should be put to one side. The better question to ask is whether, by construction of the terms of the contract, the person is contracted to work in the business or enterprise of the purported employer313. That question is focused on the contract, the nature of the relationship disclosed by the contract and, in this context, whether the contract discloses that the person is working in the business of the purported employer. It invites no inquiry into subsequent conduct314. A consequence of a negative answer to that alternative question may be that the person is not an employee. Another consequence may be, but does not have to be, that they have their own business. As five judges of this Court said in Hollis v Vabu Pty Ltd315, both employees and contractors can work "for the benefit of" their employers and principals respectively, and so that, "by itself", cannot be a sufficient indication that a person is an employee (emphasis added). That does not detract from the fact that where the contract is oral, or partly oral and partly in writing, subsequent conduct may be admissible in specific circumstances for specific purposes – the contract was formed, to objectively determine the contractual terms that were agreed or whether the contract has been varied or discharged316. the point at which This Court has previously cautioned against ascribing too much weight to "labels" used by parties to describe their relationship317. The whole of the contract 123 [210]. See also Stevens (1986) 160 CLR 16 at 37; Hollis (2001) 207 CLR 21 at 42 [48]; ACE Insurance Ltd v Trifunovski (2011) 200 FCR 532 at 543 [29]. 313 See Hollis (2001) 207 CLR 21 at 39 [40]. See also Barrett (1973) 129 CLR 395 at 401, citing Zuijs (1955) 93 CLR 561. 314 cf Silk (1947) 331 US 704 at 713; Bank voor Handel en Scheepvaart NV v Slatford [1953] 1 QB 248 at 295; Market Investigations [1969] 2 QB 173 at 185. 315 (2001) 207 CLR 21 at 39 [40]. 316 See [177] above and [188] below. 317 Curtis v Perth and Fremantle Bottle Exchange Co Ltd (1914) 18 CLR 17 at 25-26, citing Weiner v Harris [1910] 1 KB 285 at 292; Scott v Davis (2000) 204 CLR 333 at 341 [14], 411 [235], 422-423 [268], 435 [299]; Hollis (2001) 207 CLR 21 at 38 [36], 45 [58]; Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 at 167 [13], 169 [19], 172 [29]. See, more generally, Re Porter; Re Transport Workers Union of is to be construed including whatever labels the parties have used to describe their relationship, but those labels are not determinative: "parties cannot deem the relationship between themselves to be something it is not"318. Adopting and adapting what was said by Gleeson CJ, Gummow, Kirby, Hayne and Crennan JJ in Bluebottle UK Ltd v Deputy Commissioner of Taxation319 in relation to a clause of deeds of assignment headed "Equitable and Legal Assignments": the classification adopted by the parties in the contract is not determinative. The classification turns upon the identification of the nature and content of the rights created by the contract and the identity of those parties which enjoyed those rights. The contract can have no greater efficacy than that given by the rights which provided its subject matter. Two further matters remain to be addressed: rejection of the "multifactorial approach" applied by the Courts below; and the authorities which have considered the employment relationship in the context of vicarious liability. The primary judge and the Full Court (following Personnel Contracting Pty Ltd v Construction, Forestry, Mining and Energy Union of Workers320) approached the question of whether Mr McCourt was an employee of Construct for the purposes of the Act by applying a "multifactorial approach" that had been developed by lower courts following this Court's decisions in Stevens v Brodribb Australia (1989) 34 IR 179 at 184, where Gray J rightly adopted the submission of Mr M E J Black QC, who said "the parties cannot create something which has every feature of a rooster, but call it a duck and insist that everybody else recognise it as a duck"; Bluebottle UK Ltd v Deputy Commissioner of Taxation (2007) 232 CLR 598 at 618 [52]. See also Kennedy v De Trafford [1897] AC 180 at 188; Colonial Mutual (1931) 46 CLR 41 at 50; Foster (1952) 85 CLR 138 at 151. 318 Hollis (2001) 207 CLR 21 at 45 [58], citing Ex parte Delhasse; In re Megevand (1878) 7 Ch D 511 at 526, 528, 532, Adam v Newbigging (1888) 13 App Cas 308 at 315, Foster (1952) 85 CLR 138 at 150-151 and TNT Worldwide Express (NZ) Ltd v Cunningham [1993] 3 NZLR 681 at 699. 319 (2007) 232 CLR 598 at 618 [52]. Sawmilling Co Pty Ltd321 and Hollis322. It has been the subject of criticism323, including on the basis that it "is somewhat empty"324 and "does not provide any external test or requirement by which the materiality of the elements may be assessed"325. The indicia that might be regarded as relevant are unconfined and "[t]here are no consistent rules about the weight that should be given to the different indicia"326. This creates considerable uncertainty. Moreover, that multifactorial approach directs attention to subsequent conduct, and potentially to matters which are peculiarly within the knowledge of one party. For reasons explained, this is contrary to principles of contractual interpretation, namely, that recourse may be had to events, circumstances and things external to the contract which are objective, which are known to the parties at the time of contracting and which assist in identifying the purpose or object of 321 (1986) 160 CLR 16 at 24, 29, citing Queensland Stations (1945) 70 CLR 539 at 552, Zuijs (1955) 93 CLR 561, Marshall (1963) 109 CLR 210 at 218 and Barrett (1973) 129 CLR 395 at 401. 322 (2001) 207 CLR 21. See, eg, Personnel (2004) 141 IR 31 at 38-39 [29]-[33], 44 [51]-[52], 54 [106]; On Call Interpreters (2011) 214 FCR 82 at 121-127 [204]-[220]; Young v Tasmanian Contracting Services Pty Ltd [2012] TASFC 1 at [3]-[5], [17]-[18], [43]-[44]; ACE Insurance v Trifunovski (2013) 209 FCR 146. 323 See, eg, Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 597; On Call Interpreters (2011) 214 FCR 82 at 122 [206]; Roles and Stewart, "The Reach of Labour Regulation: Tackling Sham Contracting" (2012) 25 Australian Journal of Labour Law 258 at 267; Irving, The Contract of Employment, 2nd ed (2019) at 68-72 [2.15]-[2.18]; Stewart and McCrystal, "Labour Regulation and the Great Divide: Does the Gig Economy Require a New Category of Worker?" (2019) 32 Australian Journal of Labour Law 4 at 8. 324 Irving, The Contract of Employment, 2nd ed (2019) at 69 [2.16]. 325 Ellis (1989) 17 NSWLR 553 at 597. See also Neil and Chin, The Modern Contract of Employment, 2nd ed (2017) at 7 [1.30]; Irving, The Contract of Employment, 2nd ed (2019) at 71 [2.18]. 326 Victoria, Report of the Inquiry into the Victorian On-Demand Workforce (June 2020) at 105 [732]. See also Ellis (1989) 17 NSWLR 553 at 597; On Call Interpreters (2011) 214 FCR 82 at 121-122 [204]-[205]; Neil and Chin, The Modern Contract of Employment, 2nd ed (2017) at 16 [1.60]; Irving, The Contract of Employment, 2nd ed (2019) at 67 [2.14]. the contract327 and, relatedly, that it is not legitimate to have regard to subsequent conduct to construe a contract328. There are good reasons for adhering to those principles. Otherwise, contrary to those principles, consideration of subsequent conduct might in some cases result in the nature of an employment relationship changing over time329 – on the day after a contract is formed, the parties may be in an employer/employee relationship, but six months or a year later, having regard to the parties' subsequent conduct, their relationship may have changed to one of principal/independent contractor, without any suggestion that there was any variation to the terms of their contractual agreement. Matters such as the degree of control or direction in fact exercised by an alleged employer in relation to the way an alleged employee performs their work, the extent to which an alleged employee provides their own equipment and tools, and whether uniforms are worn330 may change over the course of an employment relationship. The potential for the legal character of a relationship between two parties to be affected by "unilateral" conduct of one party that may be unknown to the other party (for example, how one party administers their tax affairs; the extent to which an alleged employee operates in a "business-like" manner, with systems and manuals331; how significant an alleged employee's investment in capital equipment is332; or the extent to which an alleged employee is financially self-reliant333) is equally problematic. The multifactorial approach was applied not merely without any central principle to guide it but also by reference to a roaming inquiry beyond the contract. It allowed consideration of what had happened after the entry into the contract to 327 Codelfa (1982) 149 CLR 337 at 352; Mount Bruce Mining (2015) 256 CLR 104 at 117 [50]. See also Prenn [1971] 1 WLR 1381 at 1385; [1971] 3 All ER 237 at 241; Reardon Smith [1976] 1 WLR 989 at 996; [1976] 3 All ER 570 at 574-575, citing Lewis (1877) 3 QBD 195 at 208; DTR Nominees (1978) 138 CLR 423 at 429; Secured Income Real Estate (1979) 144 CLR 596 at 606. 328 Gardiner (2008) 238 CLR 570 at 582 [35], quoting James Miller & Partners [1970] AC 583 at 603, repeated in Daera Guba (1973) 130 CLR 353 at 446. 329 James Miller & Partners [1970] AC 583 at 603. 330 On Call Interpreters (2011) 214 FCR 82 at 126 [218]; ACE Insurance (2011) 200 FCR 532 at 543 [29]; Eastern Van Services Pty Ltd v Victorian WorkCover Authority (2020) 296 IR 391 at 400 [36]. 331 ACE Insurance (2011) 200 FCR 532 at 543 [29]. 332 cf Hollis (2001) 207 CLR 21 at 41 [47]. 333 On Call Interpreters (2011) 214 FCR 82 at 126 [218]. characterise the nature of "the status or relationship of parties"334. That is not appropriate. Such an inquiry slips away from – slips over – the critical consideration that the relationship between the parties is the relationship established by contract335. Conduct may be looked at to establish the formation336, variation337 or discharge by agreement and the remaking of a contract338. But evidence that is relevant to inquiries of those kinds is limited by the purpose of the inquiry. The evidence of what was done is relevant only if and to the extent that it shows or tends to show that a contract was made between the parties or a contract previously made between the parties was varied or discharged. Following WorkPac339, the multifactorial approach applied in previous authorities must be put to one side when characterising a relationship as one of employment under a contract. The approach in WorkPac seeks to avoid the difficulties just identified with the multifactorial approach and, in particular, seeks to avoid "employee" and "employer" becoming legal terms of meaningless reference. It focuses the task of characterisation by reference to established doctrine, rather than inviting an assessment of the relationship between two parties which is "amorphous" and "inevitably productive of inconsistency"340. The need for judgment is unavoidable, but this approach promotes certainty by providing 334 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 636 [8] ("Personnel (No 2)"). See On Call Interpreters (2011) 214 FCR 82 at 121-122 [204]; ACE Insurance (2011) 200 FCR 532 at 543 [29]; Quest (2015) 228 FCR 346 at 389-390 [176]-[181]. 335 WorkPac (2021) 95 ALJR 681 at 693 [57]-[58]; 392 ALR 39 at 52; see also 95 ALJR 681 at 699 [97]; 392 ALR 39 at 60, citing Foster (1952) 85 CLR 138 at 151. 336 Brambles Holdings (2001) 53 NSWLR 153 at 163-164 [25], citing, among other cases, Howard Smith (1907) 5 CLR 68 at 77 and Barrier Wharfs (1908) 5 CLR 647 at 668, 669, 672; Franklins (2009) 76 NSWLR 603 at 616 [13]. 337 Phillips (1941) 65 CLR 221 at 243-244; Tallerman (1957) 98 CLR 93 at 112-113; Chaplin (1978) 52 ALJR 407 at 411; 18 ALR 385 at 392-393. 338 Tallerman (1957) 98 CLR 93 at 112-113; ALH (2012) 245 CLR 338 at 350-351 [31]-[32]. See, generally, Olsson v Dyson (1969) 120 CLR 365 at 388-389, quoting Scarf v Jardine (1882) 7 App Cas 345 at 351. See also Chitty on Contracts, 33rd ed (2018), vol 1 at 1087 [13-124], citing Goss (1833) 5 B & Ad 58 at 64 [110 ER 713 at 716] and Morris [1918] AC 1. 339 (2021) 95 ALJR 681; 392 ALR 39. 340 Personnel (No 2) (2020) 279 FCR 631 at 655 [76]. identified and well-established limits: admissible evidence to identify the formation and the terms of the contract and the established principles of contractual interpretation. It is necessary to address other aspects of Hollis and Stevens. Unlike the present case, the contract in issue in Hollis was partly oral and partly in writing341 and the relevant contractual arrangements in Stevens were not "formalized"342. As explained, when an oral contract or a partly oral, partly written contract is in issue, recourse to conduct may be necessary to identify the point at which the contract was formed and the contractual terms that were agreed. In relation to the latter, "[s]ome terms may be inferred from the evidence of a course of dealing between the parties", "[s]ome terms may be implied by established custom or usage", and "[o]ther terms may satisfy the criterion of being so obvious that they go without saying"343. But in each of these cases, the question is whether the particular term "is necessary for the reasonable or effective operation of the contract in the circumstances of the case"344. In this way, even where the contract has not been reduced to a complete written form, the admissible evidence is limited to identifying those matters – formation and terms – objectively and for those limited purposes345. Further, it must be recalled that Hollis and Stevens concerned vicarious liability. Whatever might be the principles upon which vicarious liability operates346, there is an important distinction between whether there is an employer/employee relationship and whether what was done was done in "the course of [that] 341 (2001) 207 CLR 21 at 33 [24]. 342 (1986) 160 CLR 16 at 39. See also Marshall (1963) 109 CLR 210 at 212, 218; Barrett (1973) 129 CLR 395 at 400; Barrett 72 ATC 457 at 460-461. 343 Byrne (1995) 185 CLR 410 at 442. See BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283; Hawkins v Clayton (1988) 164 CLR 539 at 573; Chattis Nominees Pty Ltd v Norman Ross Homeworks Pty Ltd (In liq) (1992) 28 NSWLR 338 at 343. 344 Byrne (1995) 185 CLR 410 at 442. See BP Refinery (1977) 180 CLR 266 at 283; Hawkins (1988) 164 CLR 539 at 573. 345 Henry Kendall & Sons v William Lillico & Sons Ltd [1969] 2 AC 31 at 104, quoting McCutcheon v David MacBrayne Ltd [1964] 1 WLR 125 at 134; [1964] 1 All ER 430 at 437; Chattis Nominees (1992) 28 NSWLR 338 at 343. 346 See Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd (2016) 250 FCR 136 at 147-149 [48]-[58] and the authorities cited there. employment"347. The relevant inquiry is not only about whether an alleged tortfeasor was an employee. There is a separate question about whether the relevant act or omission of the alleged employee took place in the course of that employment348. That second question necessarily directs attention to the state of affairs at the time the cause of action accrues. The second question is asked for a different purpose and at a different point in time. The state of affairs relevant to that inquiry necessarily includes facts and matters, including subsequent conduct, that are not relevant to answering the first question. To the extent that a fact or matter may be considered relevant to both questions, not only is that fact or matter considered for a different purpose in answering each question but the weight to be attached to that consideration is likely to be different. Mr McCourt and Construct Mr McCourt worked at the Concerto Project over two separate periods – 27 July 2016 to 6 November 2016 and 14 March 2017 to 24 June 2017 – and he briefly worked at the Aire Project from 26 June 2017 to 30 June 2017. Each of those periods was a period in which Mr McCourt and Construct were in an employment relationship. The legal rights and obligations which constituted the employment relationship for each period derived from the same written contract of employment. The contract between Construct and Mr McCourt was wholly in writing and the relevant provisions were set out in the ASA. Under the heading "Construct's Responsibilities", cl 1(c) provided that Construct was obliged to "[l]iaise between builders and the Contractor [ie, Mr McCourt] regarding the means by which the Contractor shall supply labour to such builders, including the duration that the builder requires such labour, the place at which labour is to be supplied, the daily hours of work during which labour is to be supplied and any other terms and conditions upon which labour is to be supplied by the Contractor to the builder" (emphasis added). This clause is significant. It gave Construct the central role in relation to, and control over, key aspects of the work to be performed by 347 Sweeney (2006) 226 CLR 161 at 167 [12]; see also 171 [23]. See Atiyah, Vicarious Liability in the Law of Torts (1967) at 31. 348 See Stevens (1986) 160 CLR 16 at 43; New South Wales v Lepore (2003) 212 CLR 511 at 535 [40], 588 [221], 594 [242]; see also 582 [202]; Sweeney (2006) 226 CLR 161 at 167 [12]; Prince Alfred College Inc v ADC (2016) 258 CLR 134 at 159-160 [80]-[81]. See also Colonial Mutual (1931) 46 CLR 41 at 48-49; Wright v Attorney-General for the State of Tasmania (1954) 94 CLR 409 at 414. Mr McCourt – when, where and how. There was no contract between Mr McCourt and the builder, Hanssen. Clause 1(d) then relevantly provided that Construct was obliged, "[s]ubject to performance by the Contractor of his or its obligations under [the ASA] ... [to] underwrite payment to the Contractor" (emphasis added). Despite the ASA using the word "underwrite", only Construct was responsible for paying Mr McCourt349. No party suggested that Hanssen (or any entity other than Construct) was bound to pay Mr McCourt. Clause 1(d) tied Mr McCourt's performance of his obligations under the ASA to his entitlement to payment from Construct. It is necessary to address those two tied aspects – obligations and entitlement to payment – in turn. First, Mr McCourt's obligations. Mr McCourt's obligations – set out in cl 4 of the ASA – were owed to Construct to enable Construct to carry on its business as described in Recital A – supplying labour to builders. Mr McCourt owed no relevant obligations to Hanssen. Under cl 4(a), he was obliged to "[c]o-operate in all respects with Construct and the builder in the supply of labour to the Builder" (emphasis added). Next, under cl 4(c), Mr McCourt was obliged to "[a]ttend at any building site as agreed with the Builder at the time required by the Builder, and ... supply labour to the Builder (subject to notification under [cl] 5(c)) for the duration required by the Builder in a safe, competent and diligent manner". While cll 4(a) and 4(c) were expressed in terms of Mr McCourt's obligation to co-operate with and to perform work as agreed with and as required by the "Builder", these obligations were owed to Construct in a contract with Construct. That is, in the event that Mr McCourt did not co-operate with the builder, Hanssen, or perform work as agreed with and as required by Hanssen, Construct would be entitled, in appropriate circumstances, to terminate the contract or to bring a claim against Mr McCourt for breach of contract under the terms of the ASA. Clause 4(d) was related to cl 4(c). It provided that the "Contractor" was obliged to "[i]ndemnify Construct against any breach by the Contractor of [cl] 4(c)". This clause was directed to ensuring that Construct did not suffer loss caused by the non-performance of work by the Contractor. And, finally, under cl 5(c), if Mr McCourt was no longer available to supply labour under the terms of the ASA, he was entitled to notify the builder and Construct on four hours' notice. The fact that Mr McCourt could give such notice may be indicative of a relationship of casual employment (so too might the fact that, under cl 3(c) of the 349 See ASA, cl 5(a). ASA, Mr McCourt warranted that he did not require Construct to guarantee work of any duration)350. The second aspect to be addressed is payment. As explained above, Construct, not the builder, was obliged to pay Mr McCourt for work undertaken by him under the ASA351. Pursuant to cl 2(a), under the heading "Construct's Rights", Construct was entitled to "[n]egotiate with any builder a payment rate for the supply by the Contractor of labour to the builder", provided that the "Contractor" was also at liberty to negotiate the payment rate and other terms and conditions with the builder. Other clauses are relevant. Clause 2(c) provided that Construct had a right to "[n]egotiate with the builder for remuneration in respect of any increase in the payment rate negotiated directly by the Contractor with the builder". Although cll 2(a) and 3(d) contemplated that Mr McCourt was able to independently negotiate an increase to his salary with Hanssen, cl 5(a) provided that the "Contractor" was entitled to receive payment from Construct, not Hanssen. Moreover, cl 2(d) provided that Construct could "[w]ithhold from the Contractor payment of any monies reasonably required by Construct to compensate it for any claim made against Construct by the builder in respect of the supply of labour by the Contractor to the builder". As is apparent, Construct was owed obligations by Mr McCourt which enabled it to carry on its labour hire business, and the discharge of those obligations by Mr McCourt was a necessary condition of Mr McCourt receiving payment for his work. The contractual terms also reveal that the contract was for Mr McCourt's personal performance of work and his mode of remuneration was consistent with that of an employment relationship352. There are some aspects of the ASA which suggest that Mr McCourt was not Construct's employee. In the Recitals and various terms of the ASA, Mr McCourt was expressly identified as an independent contractor, or as not an employee of Construct: Recital A referred to Construct liaising between builders and "self-employed contractors for the provision of labour by self-employed contractors to builders and supplying to the self-employed contractors financial administrative services"; under cl 3(b) the "Contractor" warranted that "[h]e [was] self-employed"; under cl 3(e) the "Contractor" warranted that "Construct [was not] liable to pay the Contractor any amounts in respect of annual leave, sick leave, long service in an employer-employee relationship"; and under cl 4(h) the "Contractor" was obliged leave or any other statutory entitlement required 350 See WorkPac (2021) 95 ALJR 681 at 698 [88]-[90]; 392 ALR 39 at 58-59. 351 ASA, cll 1(d) and 5(a). 352 See Stevens (1986) 160 CLR 16 at 24, 36-37. to "[n]ot represent himself as being an employee of Construct at any time or otherwise represent himself as authorised to act on behalf of Construct other than strictly under the terms of [the ASA]". As has been observed, those matters are The totality of the relationship between Construct and Mr McCourt provided for by the ASA was that of employer and employee. The totality of that relationship can be contrasted with the description of an independent contractor given by Dixon J in Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd354, namely: "[t]he work ... is considered as the independent function of the person who undertakes it, and not as something which the person obtaining the benefit does by his representative standing in his place". Under the ASA, Mr McCourt agreed to work in the business or enterprise of Construct. Construct's business was labour hire and Mr McCourt agreed with Construct that in return for Construct paying him for the work he would do, he would provide his labour to Hanssen (the entity to which Construct had agreed it would provide labour). Put in different terms, under the ASA Mr McCourt contracted with Construct and promised Construct that he would work at its direction for the benefit of Construct's business of supplying labour to Construct's customers and, in return, he was paid by Construct. Nothing in the context objectively known to the parties at the time of making the ASA detracts from that characterisation of that relationship as one of employer and employee. Rather, the context of an individual on a working holiday visa being contracted to perform labouring work as directed by Construct and required to provide nothing but basic personal protective equipment reinforces that characterisation. Given that both parties accepted that the contract between Construct and Mr McCourt was wholly in writing (relevantly, in the ASA), it is neither necessary nor appropriate to look at how the ASA was performed. In this appeal, subsequent conduct is irrelevant. Conclusion and orders For these reasons, I agree with the orders proposed by Kiefel CJ, Keane and Edelman JJ. The appeal should be allowed and the matter should be remitted to the primary judge to determine the application made by the CFMMEU and Mr McCourt for compensation for contraventions of the Award according to law. 353 See [184] above. 354 (1931) 46 CLR 41 at 48, quoted in Hollis (2001) 207 CLR 21 at 39 [39]. STEWARD J. I respectfully agree with Gordon J's expression of the test to determine whether a person is an employee. Subject to three observations, I would nonetheless dismiss the appeal, confined to the reasons expressed below. The three observations First, care should be taken before concluding that even very unskilled or simple activities are not capable of constituting a business. A business can arise from limited activities which are passive in nature355 and can exist in the absence of any entrepreneurial skill356. It can also exist where a profit motive is entirely lacking357. Secondly, it is arguable that cl 4(a) of the Administrative Services Agreement ("the ASA") did not confer on the respondent significant control over the second appellant ("Mr McCourt"). In a contractual context in which the respondent specifically sought to avoid a legal conclusion whereby Mr McCourt became its employee – an objective acknowledged by Mr McCourt358 – the use of the word "co-operate" in cl 4(a) may be significant. It suggests that the parties intended to reserve to Mr McCourt a degree of independence and wished to avoid a relationship of subservience. Thirdly, it is also arguable that the ASA did not give the respondent a right to terminate its arrangement with Mr McCourt following any breach by him of cl 4(a) (or (c)) of the ASA. The ASA conferred no express right of termination359. It would otherwise depend on the facts whether Mr McCourt's hypothetical conduct in breaching the ASA would permit the respondent to terminate that agreement. Reasons for dismissing the appeal In 1989, Woodward J handed down his decision in Odco Pty Ltd v Building Workers' Industrial Union of Australia360. His Honour decided that workers 355 Ferguson v Federal Commissioner of Taxation (1979) 37 FLR 310; Puzey v Commissioner of Taxation (2003) 131 FCR 244. 356 Federal Commissioner of Taxation v Stone (2005) 222 CLR 289. 357 Federal Commissioner of Taxation v Stone (2005) 222 CLR 289 at 305 [55] per Gleeson CJ, Gummow, Hayne and Heydon JJ. See also G v Commissioner of Inland Revenue [1961] NZLR 994. 358 See Recital A and cl 3(b) of the ASA. 359 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 667 [122] per Lee J. 360 Unreported, Federal Court of Australia, 24 August 1989. supplied by a business, trading as "Troubleshooters Available", to participants in the building industry were not employees of that business, but were instead independent contractors. The arrangement considered by Woodward J is materially the same as the one used here by the respondent, whereby the labour of Mr McCourt was supplied to a building company in Perth. The essence of these arrangements is the supply of labour rather than some product or result. Woodward J's decision was upheld on appeal by a unanimous decision of the Full Court of the Federal Court of Australia in Building Workers' Industrial Union of Australia v Odco Pty Ltd361. A subsequent application for special leave to this Court was unsuccessful on the ground that the proposition, amongst others, that there was no contract of employment between the worker and Troubleshooters Available was not attended with sufficient doubt362. In the years which followed, many businesses sought to implement the same arrangement upheld in Odco – they became known as "Odco" arrangements. When businesses conformed materially to that arrangement, the workers they supplied were found to be independent contractors; it did not matter what type of labour was to be supplied. An example is found in the Industrial Appeal Court of Western Australia's decision in Personnel Contracting Pty Ltd t/as Tricord Personnel v Construction, Forestry, Mining and Energy Union of Workers363. As Allsop CJ observed below, that case concerned an "earlier version" of the contract entered into here between Mr McCourt and the respondent364. Another example is the decision of the Full Court of the Supreme Court of Tasmania in Young v Tasmanian Contracting Services Pty Ltd365. On occasion, arrangements which differed in some respects from "Odco" arrangements led to a conclusion being drawn that the worker was an employee of the labour hire company. An example of this is found in the decision of the Court of Appeal of the Supreme Court of Victoria in Drake Personnel Ltd v 361 (1991) 29 FCR 104. 362 Transcript of Proceedings, Building Workers' Industrial Union of Australia v Odco Pty Ltd (High Court of Australia, No M13 of 1991, Mason CJ, Dawson and McHugh JJ, 7 June 1991). 364 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 642 [31] (Jagot J agreeing), see also at 666-667 [121] per Lee J. 365 [2012] TASFC 1. Commissioner of State Revenue366. In that case, Phillips JA observed that the labour hire company had taken on more obligations of responsibility for the worker367 and, as a result, the worker was found to be a casual employee. On another occasion, the labour hire company that was party to the original decision of Woodward J was found to be an employer of labourers working under a contract of service by reason of specific statutory deeming provisions. This occurred in relation to certain workers in this Court's decision in Accident Compensation Commission v Odco Pty Ltd368, which concerned the Accident Compensation Act 1985 (Vic). The arrangement considered by the Court was described as follows369: "When a builder needs a tradesman [she or he] contacts [Troubleshooters Available ('TSA')] and places an order. An employee of TSA then completes an order sheet recording the builder's name, the person to whom the tradesman should report at the building site, the type of tradesman required and the duration of the work. The employee of TSA then contacts an appropriate tradesman and advises the tradesman of the builder's requirements. If the proposal is acceptable to the tradesman, [she or he] attends at the building site and performs the necessary work at the direction of the builder. Subsequently, the tradesman telephones TSA to advise details of hours worked during the previous seven days. TSA raises an invoice to the builder charging the hours worked by the tradesman at a previously agreed hourly rate (which includes remuneration to TSA for its services to the builder). The tradesman is paid by TSA at the hourly rate or set price agreed between TSA and the tradesman. The tradesman makes no payment to TSA for having placed [her or him]. TSA's reward comes from the difference between the amount it charges the builder and the amount it pays the tradesman." It was not then suggested that the tradesmen under the foregoing arrangement were casual employees at common law. the House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation published the result of its inquiry into "independent contracting and labour hire arrangements". 367 Drake Personnel Ltd v Commissioner of State Revenue (2000) 2 VR 635 at 655 [52] (Buchanan JA agreeing), see also at 639 [5] per Ormiston JA. 368 (1990) 64 ALJR 606; 95 ALR 641. 369 Accident Compensation Commission v Odco Pty Ltd (1990) 64 ALJR 606 at 607- 608 per Mason CJ, Brennan, Dawson, Toohey and McHugh JJ; 95 ALR 641 at 644. The Standing Committee noted that the growth in "independent contracting and labour hire employment" had "clearly" indicated that it had "become a preferred employment choice for many Australians"370. It also observed that "over 10 per cent of the workforce" at that time identified themselves as being "independent contractors across a wide variety of industries"371. The Committee specifically referred to the use of "Odco" arrangements. The report thus stated372: Labour hire of contractor services involves the labour hire agency hiring contractors (that is workers with their own Australian Business Numbers (ABNs), as determined by taxation legislation) to host businesses to meet the client's production or service requirements. are independent is based on 'Odco' The contractor services model arrangements, which contracting arrangements in the labour hire industry. 'Odco' arrangements create an independent contracting arrangement where the workers are neither employees of the labour hire agency nor the host business. These kinds of arrangements were upheld in a full Federal Court decision, Building Workers['] Industrial Union of Australia v Odco Pty Ltd. On other occasions, courts have found that contractual arrangements did not conf[o]rm to 'Odco' arrangements, and have held on the facts that the workers in question were 'employees', in contractual notwithstanding having been described documents as 'contractors'. 'Odco' arrangements operate in a range of industries. Independent contractors working under this system include farm hands, doctors, secretaries, personal assistants, family 370 Australia, House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation, Making it Work: Inquiry into independent contracting and labour hire arrangements, 17 August 2005 at ix. 371 Australia, House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation, Making it Work: Inquiry into independent contracting and labour hire arrangements, 17 August 2005 at ix. 372 Australia, House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation, Making it Work: Inquiry into independent contracting and labour hire arrangements, 17 August 2005 at 34. Steward day-care workers, fishermen, salespeople, cleaners, security guards and building workers." (footnotes omitted) Following the publication of that report, the Federal Parliament passed the Independent Contractors Act 2006 (Cth). The relevant Explanatory Memorandum referred to the foregoing report, as well as to a discussion paper prepared by the Department of Employment and Workplace Relations entitled "Proposals for Legislative Reform and Labour Hire Arrangements"373. That discussion paper also referred to industry use of "Odco" arrangements, which were described as follows374: Independent Contracting "The contractor services model is based on 'Odco' arrangements which are independent contracting arrangements in the labour hire industry. These kinds of arrangements were upheld in a Full Federal Court decision, Building Workers['] Industrial Union of Australia v Odco Pty Ltd. Odco arrangements create independent contracting arrangement[s] where the workers are neither employees of the labour hire company nor of that company's clients." (footnote omitted) Section 3 of the Independent Contractors Act states that the objects of the Act include protecting "the freedom of independent contractors to enter into services contracts"; the recognition of "independent contracting as a legitimate form of work arrangement that is primarily commercial"; and the prevention of "interference with the terms of genuine independent contracting arrangements". The term "independent contractor" is not defined in this Act, but the Explanatory Memorandum describes such a contractor as someone who might work for a labour hire firm and states as follows375: "An 'independent contractor' is a person who contracts to perform services for others without having the legal status of an employee. The term is generally used to refer to a person who is engaged by a principal, rather than an employer, on a labour only contract. Under such a contract, the principal pays the independent contractor a one-off flat rate. There are generally no legislatively prescribed minimum entitlements or other 373 Australia, House of Representatives, Independent Contractors Bill 2006, Explanatory Memorandum at 26. 374 Australia, Department of Employment and Workplace Relations, Discussion Paper: Proposals for Legislative Reforms in Independent Contracting and Labour Hire Arrangements (2005) at 25. 375 Australia, House of Representatives, Independent Contractors Bill 2006, Explanatory Memorandum at 3. employee-style benefits and the independent contractor is responsible for a number of aspects of the relationship that would usually be the responsibility of an employer (for instance, remitting income tax to the Australian Tax Office and contributing to a superannuation fund). Independent contractors' work arrangements take a variety of forms, for example, they may have a direct relationship with another enterprise or work through an intermediary (such as a labour hire firm), and they may or may not employ staff." The Independent Contractors Act permits, amongst other things, an application to be made to a federal court to review a "services contract" (as defined)376 on the grounds that it is unfair or harsh377. An "unfairness ground" is defined to include being paid "less than the rate of remuneration for an employee performing similar work"378. Mr Peter Wieske is a director of the respondent. He gave evidence before the Federal Court that he had discovered "ODCO" and had "learned much from their website and precedent court cases". His unchallenged evidence was that the arrangement used in this case was "modelled on the ODCO system". In the Full Court's decision below, Lee J observed that "[w]hatever else may be unclear, what is pellucid is that [the respondent] sought to replicate an 'Odco' style arrangement"379. Lee J also observed that the "'Odco' style arrangement [had] been replicated on a multitude of occasions, with courts then tasked with [had] been successfully adjudicating upon whether such arrangement implemented"380. Lee J concluded that the respondent had, if anything, sought to 376 Independent Contractors Act 2006 (Cth), s 5. 377 Independent Contractors Act 2006 (Cth), s 12. 378 Independent Contractors Act 2006 (Cth), s 9(1)(f). 379 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 666 [118] (Allsop CJ and Jagot J agreeing). 380 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 666 [120] (Allsop CJ and Jagot J agreeing). buttress further its contention that it was not the employer of its workers after its success in the Industrial Appeal Court of Western Australia. Lee J said381: "To simplify an exercise in semantics, which is neither productive nor helpful, what has in effect happened, is that [the respondent], following its success in 2004, has sought to make assurance doubly sure by backfilling any gaps in the written agreement which could be construed as contra-indicating an independent contractor relationship. These include factors such as: the removal of an express right to terminate the arrangement on the part of [the respondent]; the removal of a non-compete clause; the introduction of an express right to negotiate rate increases; the removal of the express incorporation of occupational health and safety, discrimination and equal opportunity guides in the agreement; the removal of the term that stated the engagement commences on the day of this agreement and expires when either terminated by the company or contractor (implying instead that a contract arises only in relation to a particular offer of work and only for a duration that is required by the builder). Indeed, as senior counsel for the [appellants] engagingly conceded, 'the situation has got worse for us'." (citations omitted) Before this Court, senior counsel for the appellants described some of the language contained in the ASA as "weasel" words, although he did not allege that any part of the ASA was a "sham". Given that concession, the brandishing of such adjectives adds little to the necessary legal analysis. The law, generally speaking, has always recognised the right of free women and men to choose the form of their arrangements382; the choice of that form may well have particular legal consequences. As Windeyer J said in Federal Commissioner of Taxation v Casuarina Pty Ltd383: "A proprietary company may well seem to be, in reality, merely the trade-name in which a [woman or man] carries on some part of [her or his] affairs. But by a following of correct legal forms the name becomes in law a thing. Formalism produces a legal substance, and its 'owner' can by careful bookkeeping get all the advantages, be they limited liability, relief from 381 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 667 [122] (Allsop CJ and Jagot J agreeing). 382 See, eg, Printing and Numerical Registering Company v Sampson (1875) LR 19 Eq 462 at 465 per Jessel MR. 383 (1971) 127 CLR 62 at 77. taxation or other benefit, which the law annexes to [her or his] sedulous use of the corporate name." Ultimately, Lee J was of the view that "if approached tabula rasa", he would have thought it "somewhat less than intuitively sound" to consider Mr McCourt to have been an independent contractor384. However, Lee J considered himself bound by the "Odco" authorities385, in particular by the decision of the Industrial Appeal Court of Western Australia386. In deciding that these decisions were not plainly wrong, Lee J was influenced by the fact that a number of entities, in the past, must have relied upon the "Odco" authorities in developing their "mode of doing business", and that to overturn those authorities now would throw the respondent's "whole enterprise", and that of those other entities, into "uncertainty"387. In addition, it would expose the respondent and those entities to "numerous civil penalties of some seriousness" for contravening the Fair Work Act 2009 (Cth)388. Allsop CJ expressed a very similar opinion389. With respect, their Honours were both correct. Longstanding authorities that have had important legislative and/or very significant commercial impact should not be overruled unless it is clear that they 384 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 682 [185] (Allsop CJ and Jagot J agreeing). 385 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 682 [185] (Allsop CJ and Jagot J agreeing). 386 Personnel Contracting Pty Ltd t/as Tricord Personnel v Construction, Forestry, Mining and Energy Union of Workers (2004) 141 IR 31. 387 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 669 [129] (Allsop CJ and Jagot J agreeing). 388 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 669 [130] (Allsop CJ and Jagot J agreeing). 389 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 644 [39] (Jagot J agreeing). are plainly wrong390. That is especially the case where parties have ordered their affairs in reliance, over a long period of time, on the effect of the authority in question. In that respect, one of the reasons given by Lord Buckmaster in Bourne v Keane for this judicial restraint is especially apt and should be repeated391: "[D]ecisions that affect the general conduct of affairs, so that their alteration would mean that taxes had been unlawfully imposed, or exemption unlawfully obtained, payments needlessly made, or the position of the public materially affected, ought in the same way to continue." In Babaniaris v Lutony Fashions Pty Ltd, Brennan and Deane JJ declined to overturn a longstanding decision of the Victorian Workers' Compensation Board392, because to have done so would have created "serious embarrassment" for workers who, because of that decision, considered themselves to be independent contractors393. In Dow Jones & Co Inc v Gutnick, Kirby J helpfully summarised the applicable principles as follows394: "Sometimes, asked to reformulate an established principle of the common law, this Court will decline the invitation, considering that any alteration of the law should be left to the legislature. Factors relevant to such decisions have included the effect on competing interests that should be consulted before any alteration of the law; the existence of significant economic implications of any change; the enactment of legislation evidencing parliamentary attention the perceived undesirability of imposing retrospective liability, especially criminal liability, on persons; and the desirability, in particular cases, of not making any change until after intensive analysis of social data and public consultation, facilities typically unavailable to a court. The fundamental restraint upon substantial judicial innovation in the expression of the law is imposed by the character of a court's functions as such and an acceptance that, under the Constitution, major legal changes in the Australian the subject; 390 Babaniaris v Lutony Fashions Pty Ltd (1987) 163 CLR 1 at 28-29 per Brennan and 391 [1919] AC 815 at 874. 392 Little v Levin Cuttings Pty Ltd (1953) 3 WCBD (Vic) 71. 393 (1987) 163 CLR 1 at 30. 394 (2002) 210 CLR 575 at 614-615 [76]. Commonwealth are the responsibility of the other branches of government, not of the courts." (footnotes omitted) More recently, a majority of this Court declined to overrule a decision of the Victorian Court of Appeal395 concerning the concept of recklessness in criminal law, even though doubts arose concerning its correctness396. Edelman J observed that the principle of judicial reluctance to overthrow a longstanding decision applied "a fortiori" to criminal law cases397. Gageler, Gordon and Steward JJ also referred to the same type of "unfairness", noting that398: "unfairness would follow if the meaning of recklessness was changed retrospectively by this Court with the result that potentially criminal conduct which occurred before this Court's decision – if that conduct has not yet been charged, or if it has been charged but not tried – would attract the lower standard of recklessness contended for by the DPP and where the DPP conceded that the decision of this Court on s 17 of the Crimes Act would have a 'flow‑on effect' for other offence provisions in Victoria." (footnote omitted) Whilst this is not a criminal law case, overturning the Full Court's decision in Odco399 would expose the respondent to significant penalties on a retrospective basis. That is unfair. It will also, as Lee J observed, greatly damage the respondent's business and the businesses of many others400. That is undesirable. It will also potentially deny to workers a choice they may wish to make to supply their labour as independent contractors, thus possibly undermining one of the objects of the Independent Contractors Act. Given the severity of these potential 395 R v Campbell [1997] 2 VR 585. 396 Director of Public Prosecutions Reference No 1 of 2019 (2021) 95 ALJR 741; 392 ALR 413. 397 Director of Public Prosecutions Reference No 1 of 2019 (2021) 95 ALJR 741 at 765 [96]; 392 ALR 413 at 440. 398 Director of Public Prosecutions Reference No 1 of 2019 (2021) 95 ALJR 741 at 756 [59]; 392 ALR 413 at 429. 399 Building Workers' Industrial Union of Australia v Odco Pty Ltd (1991) 29 FCR 104. 400 Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2020) 279 FCR 631 at 669 [129] (Allsop CJ and Jagot J agreeing). consequences, which will apply retrospectively401, the fate of the Full Court's decision in Odco402 should be a matter left for the legislative branch of government to consider403. The decision, and those that have followed it, are not plainly wrong. The cogency of the reasons of the learned primary judge in this case is a sufficient basis for that conclusion. I would dismiss the appeal. 401 Giannarelli v Wraith (1988) 165 CLR 543 at 584-586 per Brennan J; Kleinwort Benson Ltd v Lincoln City Council [1999] 2 AC 349 at 358-359 per Lord Browne-Wilkinson. 402 Building Workers' Industrial Union of Australia v Odco Pty Ltd (1991) 29 FCR 104. 403 cf Nelson v Nelson (1995) 184 CLR 538 at 602 per McHugh J.
HIGH COURT OF AUSTRALIA AND PLAINTIFF MINISTER FOR IMMIGRATION AND BORDER PROTECTION DEFENDANT Falzon v Minister for Immigration and Border Protection [2018] HCA 2 7 February 2018 ORDER Application dismissed with costs. Representation S B Lloyd SC with D P Hume for the plaintiff (instructed by Zali Burrows Lawyers) A M Mitchelmore with C J Tran for the defendant and for the Attorney- General of the Commonwealth, intervening (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Falzon v Minister for Immigration and Border Protection Constitutional law (Cth) – Judicial power – Ch III – Where plaintiff holder of Absorbed Person Visa and Class BF Transitional (Permanent) Visa – Where plaintiff convicted of trafficking large commercial quantity of cannabis and sentenced to 11 years' imprisonment – Where s 501(3A) of Migration Act 1958 (Cth) requires Minister for Immigration and Border Protection to cancel visa where visa holder has substantial criminal record and is serving sentence of imprisonment on full-time basis – Where plaintiff's visas cancelled under s 501(3A) – Where plaintiff held in immigration detention pending deportation – Whether s 501(3A) authorises or requires detention – Whether purpose of s 501(3A) is to punish – Whether s 501(3A) confers judicial power on Minister – Whether s 501(3A) invalid as contrary to Ch III of Constitution. Words and phrases – "aliens", "character test", "immigration detention", "judicial power", "protection of society", "punishment", "punitive purpose", "substantial criminal record", "unlawful non-citizen". Constitution, Ch III, s 51(xix). Migration Act 1958 (Cth), ss 34, 189, 196, 198, 501, 501CA. KIEFEL CJ, BELL, KEANE AND EDELMAN JJ. The plaintiff, Mr John Falzon, is a national of Malta who has lived in Australia for 61 years. He arrived in Australia with his family at the age of three. He did not at any time obtain Australian citizenship. Until 10 March 2016 he held an Absorbed Person Visa1 and a Class BF Transitional (Permanent) Visa. His legal status as the holder of these visas was as a lawful non-citizen2. In 2008 the plaintiff was convicted of trafficking a large commercial quantity of cannabis and he was sentenced to 11 years' imprisonment with a non- parole period of eight years. He had previous convictions for drug-related and other offences. He was in custody in respect of the 2008 conviction when his Absorbed Person Visa was cancelled by a delegate of the Minister acting under s 501(3A) of the Migration Act 1958 (Cth) ("the Cancellation Decision"). The cancellation of this visa has the effect that the Minister is taken to have decided to cancel the plaintiff's other visa3. At the conclusion of the non-parole period, four days after the Cancellation Decision, the plaintiff was taken into immigration detention, where he remains. Section 501(3A) provides that: "The Minister must cancel a visa that has been granted to a person if: the Minister is satisfied that the person does not pass the character test because of the operation of: paragraph (6)(a) (substantial criminal record), on the basis of paragraph (7)(a), (b) or (c); or paragraph (6)(e) (sexually based offences involving a child); and the person is serving a sentence of imprisonment, on a full-time basis in a custodial institution, for an offence against a law of the Commonwealth, a State or a Territory." 1 Migration Act 1958 (Cth), s 34. 2 Migration Act 1958 (Cth), s 13(1). 3 Migration Act 1958 (Cth), s 501F(3). Bell Edelman Section 501(6)(a) provides that a person does not pass the character test if the person has a substantial criminal record, as defined by s 501(7). Section 501(7)(a), (b) and (c), to which s 501(3A)(a)(i) refers, provide that a person has a substantial criminal record if the person has been sentenced to death, to imprisonment for life, or to a term of imprisonment of 12 months or more. Section 501(12) defines "imprisonment" to include "any form of punitive detention in a facility or institution". "Sentence" is there defined to include "any form of determination of the punishment for an offence". By s 501(6)(e), a person also does not pass the character test if a court in Australia or a foreign country has convicted the person of one or more sexually based offences involving a child, or found the person guilty of such an offence, or found a charge against the person proved for such an offence, even if the person was discharged without conviction. The Minister is obliged to invite the person whose visa is cancelled to make representations about the revocation of the original decision to cancel4. The manner and form of those representations are regulated by reg 2.52 of the Migration Regulations 1994 (Cth). Section 501CA(4) of the Migration Act provides that the Minister may revoke the original decision if the person whose visa has been cancelled makes representations in accordance with the invitation and the Minister is satisfied that the person passes the character test or that there is another reason why the original decision should be revoked. A decision not to exercise the power conferred by s 501CA(4) is not the subject of review under Pt 5 or Pt 7 of the Migration Act5. On 15 March 2016 the plaintiff sought revocation of the Cancellation Decision. On 10 January 2017 the Assistant Minister for Immigration and Border Protection ("the Assistant Minister") decided not to revoke the Cancellation Decision. The Assistant Minister was not satisfied that the plaintiff passed the character test given his substantial criminal record. The Assistant Minister then considered whether there was another reason why the Cancellation Decision should be revoked. The Assistant Minister acknowledged that the plaintiff has strong family ties to Australia and that his removal would cause substantial emotional, psychological and practical hardship to his family. The plaintiff has two sisters and four brothers, four adult children and 10 grandchildren in Australia as well as nieces, nephews and other minor family 4 Migration Act 1958 (Cth), s 501CA(3)(b). 5 Migration Act 1958 (Cth), s 501CA(7). Bell Edelman members. The Assistant Minister accepted that after a lengthy absence from Malta the plaintiff may suffer some social isolation and emotional hardship. The Assistant Minister nevertheless concluded that the plaintiff represents an unacceptable risk of harm to the Australian community and its protection outweighs the interests of the plaintiff's family and other considerations. The Assistant Minister decided not to revoke the decision to cancel the plaintiff's Absorbed Person Visa. The plaintiff contends that s 501(3A) of the Migration Act purports to confer the judicial power of the Commonwealth on the Minister and thereby infringes Ch III of the Constitution. Central to the plaintiff's argument is that, in its legal operation and practical effect, s 501(3A) further punishes him for the offences he has committed and that is its purpose. The plaintiff seeks orders quashing the Cancellation Decision and the decision not to revoke that decision, an order of mandamus requiring his removal from detention and a declaration that s 501(3A) is invalid. The statutory scheme Section 501(3A) forms part of a statutory scheme within the Migration Act which advances the object of regulating the presence in Australia of non- citizens, in the national interest, and the removal or deportation from Australia of non-citizens whose presence in Australia is not permitted by the Act6. The retention of a valid visa is essential to a non-citizen who wishes to remain in Australia. The status of a lawful non-citizen is accorded to a non- citizen in the migration zone who holds a visa that is in effect7. Any non-citizen who is not a lawful non-citizen is an unlawful non-citizen8. The effect of the cancellation of a visa is to render a person an unlawful non-citizen9. Provisions relating to the grounds for, and processes governing, the cancellation of visas are contained in Pt 9 of the Migration Act. Section 501, of which s 501(3A) forms part, provides for the refusal or cancellation of visas on character grounds. Section 501(1) provides that the Minister may refuse to grant 6 Migration Act 1958 (Cth), ss 4(1) and 4(4). 7 Migration Act 1958 (Cth), s 13(1). 8 Migration Act 1958 (Cth), s 14(1). 9 Migration Act 1958 (Cth), s 15. Bell Edelman a visa to a person if the person does not satisfy the Minister that the person passes the character test. Section 501(2) provides that the Minister may cancel a visa if the Minister reasonably suspects that the person does not pass the character test and the person does not satisfy the Minister that the person passes the character test. Section 501(3A), which is set out above, obliges the Minister to cancel a visa if the conditions there stated exist. the duration of Section 196 provides A person whose visa is cancelled and who becomes an unlawful non- citizen is liable to immigration detention. Section 189(1) provides that an officer who reasonably suspects that a person is an unlawful non-citizen must detain the that detention. for person. Section 196(1)(a), (b) and (c) provide generally that a person detained under s 189 must be kept in immigration detention until he or she is removed from Australia, deported or granted a visa. Section 196(4) provides, subject to s 196(1)(a), (b) and (c), that if the person is detained as a result of the cancellation of his or her visa under s 501, the detention is to continue unless a court determines that the detention is unlawful or that the person detained is not an unlawful non-citizen. Section 196(5) provides that sub-s (4) applies whether or not there is a real likelihood of the person detained being removed under s 198 or s 199 in the reasonably foreseeable future and whether or not the decision relating to the person's visa is unlawful. The plaintiff makes no challenge to the scheme of the Migration Act referred to above, nor does he challenge the validity of s 189 or s 196. A challenge of the latter kind would encounter the difficulty that, in Al-Kateb v Godwin10 and in Re Woolley; Ex parte Applicants M276/200311, this Court held, applying the principles stated in Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs12 ("Lim"), that ss 189 and 196 authorise and require the detention of a non-citizen for the purpose of his or her removal from Australia and do not infringe the separation of the judicial power of the Commonwealth under Ch III. It is to be inferred from the plaintiff's argument, to which reference will later be made, that at least for some part of his immigration detention he was not detained under s 189; but rather he was detained under and for the purposes of s 501(3A). 10 (2004) 219 CLR 562; [2004] HCA 37. 11 (2004) 225 CLR 1; [2004] HCA 49. 12 (1992) 176 CLR 1 at 32; [1992] HCA 64. Bell Edelman The plaintiff's case Chapter III – exclusively judicial functions The plaintiff's case involves a series of propositions which are said to lead to a conclusion that s 501(3A) infringes Ch III and is therefore invalid. The first proposition advanced by the plaintiff is uncontroversial. It is that "the power to punish guilt for an offence against a law of the Commonwealth is exclusive to the Ch III judiciary". In Lim, this Court confirmed that the power to adjudge and to punish guilt for an offence against a law of the Commonwealth is exclusive to the Ch III judiciary under the Commonwealth Constitution13. Chapter III therefore prevents the enactment of any law purporting to vest any part of that function in the Commonwealth Executive Government. The plaintiff seeks to clarify the statement of principle in Lim in one respect. He submits that the exclusive power is to "adjudge guilt of, or determine punishment for, breach of the law"14. On this view, it is sufficient for invalidity, by reference to Ch III, if the statutory provision punishes a person for an offence. This does not appear to be disputed by the defendant. One form of punishment is involuntary detention. In Lim it was said that it would be beyond the legislative power of the Parliament to invest the Executive with arbitrary power to detain citizens in custody notwithstanding that the power was conferred in terms which sought to divorce such detention in custody from both punishment and criminal guilt15. That is because the involuntary detention of a citizen in custody by the State is penal or punitive in character and under our system of government exists only as an incident of the exclusively judicial function of adjudging or punishing criminal guilt. The plaintiff accepts that not all laws authorising or requiring detention will infringe Ch III. In Lim16 it was held that the legislative power conferred by 13 Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 27. 14 Re Tracey; Ex parte Ryan (1989) 166 CLR 518 at 580 per Deane J; [1989] HCA 12 (emphasis added). 15 Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 27. 16 (1992) 176 CLR 1 at 32. Bell Edelman s 51(xix) of the Constitution encompasses the conferral on the Executive of authority to detain an alien for the purposes of expulsion or deportation. Such an authority constitutes an incident of the executive power of deportation or expulsion. This limited authority to detain an alien in custody can be conferred upon the Executive without infringing Ch III because the authority to detain is neither punitive in nature nor part of the judicial power of the Commonwealth. When conferred on the Executive it takes its character from the executive power to exclude or deport. "All the circumstances" The plaintiff's second proposition is that "whether a law purports to confer power to punish guilt for an offence against a law of the Commonwealth is to be assessed by reference to all the circumstances". Clearly, whether a law has the character of one conferring a power to punish is a question of construction. The plaintiff accepts that, in accordance with ordinary principles of statutory construction, an important issue will be the purpose of the law. Indeed, in addressing a Ch III challenge it is necessary first to identify the purpose of detention17. In Re Woolley18, McHugh J said that "[t]he terms of the law, the surrounding circumstances, the mischief at which the law is aimed and sometimes the parliamentary debates preceding its enactment will indicate the purpose or purposes of the law". Of course an enquiry into whether the purpose of a law is to punish guilt presupposes that the law provides a power to detain. That is a distinct question with respect to s 501(3A), which does not, in terms, authorise or require the detention of a person whose visa has been cancelled. The plaintiff submits that a law may infringe the separation of powers even though it does not, in terms, authorise or require the extra-judicial detention of a person. He submits that the legal and practical operation of the law, not just its terms, is relevant to its constitutional character or purpose19. This submission is later developed in the plaintiff's argument in an attempt to show that s 501(3A) 17 Plaintiff M96A/2016 v The Commonwealth (2017) 91 ALJR 579 at 584-585 [21]; 343 ALR 362 at 367-368; [2017] HCA 16. 18 (2004) 225 CLR 1 at 26 [60]. 19 See ICM Agriculture Pty Ltd v The Commonwealth (2009) 240 CLR 140 at 198- 199 [138]; [2009] HCA 51. Bell Edelman did in fact require his detention, at least for the period during which the question whether the Cancellation Decision was to be revoked was under consideration. The defendant accepts that constitutional analysis proceeds from an appreciation of the legal and practical consequences of the challenged law, but says that s 501(3A) cannot sensibly be said to authorise detention in its legal and practical operation. Executive detention is prima facie penal or punitive The plaintiff's third proposition is that the default position is that non- judicial detention of a person is penal or punitive and therefore involves an exercise of the judicial power of the Commonwealth. The plaintiff's submission recognises that there may be detention by the Executive which is not penal or punitive and does not involve an exercise of judicial power, as Lim holds. On the plaintiff's argument the only way in which a law by which a person is detained by the Executive may escape characterisation as penal or punitive is to justify it by reference to a non-punitive purpose. In that regard, it is said that it is relevant to ask whether the law is proportionate to a non-punitive end. The plaintiff points to decisions of this Court in which it has been said that Lim establishes a constitutional principle in the nature of a prohibition against detention of a person "without just cause"20 and that any form of detention is penal or punitive "unless justified as otherwise"21. It is doubtless correct to observe that the detention of a person by the Executive without more is likely to permit an inference to be drawn that, for some reason, the legislature wishes to punish the person to be detained22. That means that the legislature must provide a reason consonant with a non-punitive purpose if the detention is to be justified. In Lim, the purpose of the detention was to support and facilitate the exercise of the executive power to remove non-citizens from Australia. Contrary to the plaintiff's submissions, these decisions do not establish that there is a constitutionally guaranteed freedom from executive detention. They do not support the notion, for which the plaintiff contends by analogy with 20 Attorney-General (NT) v Emmerson (2014) 253 CLR 393 at 429-430 [53]; [2014] HCA 13. 21 North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at 611-612 [98]; [2015] HCA 41. 22 Re Woolley; Ex parte Applicants M276/2003 (2004) 225 CLR 1 at 25-26 [60]. Bell Edelman cases such as McCloy v New South Wales23, that any restriction on such a freedom must be justified by showing that the legislative restriction is proportionate. In the joint judgment in Lim24, the issue was raised whether two of the statutory provisions there in question, which required a designated person to be detained and kept in custody, were valid by reference to Ch III. The issue was stated to be whether the detention so authorised and required is "reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered". If the detention is not limited to those purposes, their Honours said, the authority conferred on the Executive "cannot properly be seen as an incident of the executive powers to exclude, admit and deport an alien. In that event, they will be of a punitive nature and contravene Ch III's insistence that the judicial power of the Commonwealth be vested exclusively in the courts which it designates."25 In Kruger v The Commonwealth26, Gummow J, referring to this passage in Lim, said that the question whether a power to detain persons and take them into custody is to be characterised as punitive in nature, so as to attract the operation of Ch III, depends upon whether that detention and custody "are reasonably capable of being seen as necessary for a legitimate non-punitive objective". The plaintiff relies upon these and similar statements in other cases in aid of a submission that what is here involved is the application of an aspect of proportionality testing. It seems, however, that the question posed by Lim is quite different from that which arises in proportionality testing. The starting point for the enquiry referred to in Lim is that the power to remove or deport aliens from a country is executive in nature and it is non- punitive. The question which then arises with respect to a statutory power given to the Executive to detain an alien in custody is whether it is given in order to facilitate or effect the removal of that person, which is the subject of executive power. The enquiry is as to whether it is "necessary" to that purpose. If it is, it 23 (2015) 257 CLR 178; [2015] HCA 34. 24 (1992) 176 CLR 1 at 33. 25 Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 33. 26 (1997) 190 CLR 1 at 162; [1997] HCA 27. Bell Edelman may be considered to be an incident of the executive power and will not be an exercise of judicial power. If the power goes further than to achieve that limited purpose it may be otherwise. In such circumstance, it may be inferred that the law has a purpose of its own, a purpose to effect punishment. The test of "reasonable necessity" in proportionality testing27, on the other hand, asks whether a legislative measure which restricts a constitutionally guaranteed freedom is reasonably necessary to achieve the valid purpose of the statute in question. The enquiry may involve asking whether there are other equally practicable means to achieve the purpose. If there are no such alternative means, the legislative restriction cannot be justified. The they arise two enquiries are different because in different constitutional contexts. Proportionality analysis is applied to constitutionally guaranteed freedoms. Such freedoms are not absolute28. Legislation may restrict those freedoms to an extent without being invalid. In that context, the question is how to determine the limits of that legislative power. Proportionality analysis is used to resolve part of that question. The test of reasonable necessity in proportionality analysis asks whether the legislative measure is necessary at all. Whether a legislative power of detention is necessary in the Ch III sense is an enquiry as to the true purpose of the law authorising detention, it is not an enquiry as to whether that law is necessary to the achievement of a relevant legislative purpose. Chapter III contains an absolute prohibition on laws which involve the exercise of the judicial power of the Commonwealth. There is no question about the extent to which a law may vest exclusively judicial functions in the Executive. We therefore agree with what McHugh J said in Re Woolley29, that "[a] law that confers judicial power on a person or body that is not authorised by or otherwise infringes Ch III cannot be saved by asserting that its operation is proportionate to an object that is compatible with Ch III". Questions of proportionality cannot arise under Ch III. 27 McCloy v New South Wales (2015) 257 CLR 178 at 210 [57]. 28 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561; [1997] HCA 25; Rowe v Electoral Commissioner (2010) 243 CLR 1 at 136 [444]; [2010] HCA 46; Maloney v The Queen (2013) 252 CLR 168 at 232 [166]; [2013] HCA 28. 29 (2004) 225 CLR 1 at 34 [80]. Bell Edelman It may nevertheless be accepted that a legislative power to detain must be justified, in the sense that it must be shown to be directed to a purpose other than to punish. The plaintiff submits that the need for justification is just as strong in relation to a non-citizen, or alien, as it is to an Australian citizen. This is because the protective principle stated in Lim applies just as much to aliens as it does to citizens. The plaintiff also submits that there is a distinction to be drawn between his circumstance and that of other aliens. His situation differs from that of an alien "who presents uninvited and unheralded at the border with no right to enter"30. He relies on what was said by Gummow J in Fardon v Attorney- General (Qld)31, that "aliens are not outlaws; many will have a statutory right or title to remain in Australia for a determinate or indeterminate period and at least for that period they have the protection afforded by the Constitution and the laws of Australia". These references are intended to highlight the plaintiff's status as an absorbed person, or, more correctly stated, as the holder of an Absorbed Person Visa. But that visa did not alter the plaintiff's status as an alien and the visa was at all times liable to cancellation. Section 34 of the Migration Act came into effect on 1 September 199432. It relevantly provides that a non-citizen in the migration zone who was in Australia before 2 April 1984 and had ceased to be an immigrant is taken to have been granted an Absorbed Person Visa on 1 September 1994. The purpose of the provision was to overcome the unintended effect of earlier amendments to the Migration Act which had caused some non-citizens to become prohibited non- citizens. Persons who had been absorbed into the Australian community prior to 2 April 1984 were not to be rendered prohibited non-citizens even if their visa status was irregular33. 30 Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship (2013) 251 CLR 322 at 385 [207]; [2013] HCA 53. 31 (2004) 223 CLR 575 at 611-612 [78]; [2004] HCA 46 (footnote omitted). 32 Migration Legislation Amendment Act 1994 (Cth). 33 See Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 228 CLR 566 at 577 [19]; [2006] HCA 50. Bell Edelman In Pochi v Macphee34 the plaintiff argued that his absorption into the Australian community meant that he was no longer an alien. The Court considered this argument to be "impossible to maintain"35. As Gibbs CJ explained36, naturalisation can be achieved only by Act of Parliament. A person's nationality is not changed by length of residence or an intention permanently to remain in a country of which he or she is not a national. Consistently with this view, the Migration Legislation Amendment Act 1994 (Cth) sought to shift the constitutional basis of the relevant provisions of the Migration Act from the immigration power in s 51(xxvii) to the aliens power in s 51(xix). In the Explanatory Memorandum to the Bill37 for those amendments it was stated that "[a]n alien only ceases to be an alien by becoming an Australian citizen". The joint judgment in Lim did not suggest that the Constitution, and laws made under it, offer the same protection to an alien as they do to a citizen. The joint judgment38 pointed out that, whilst an alien present in this country enjoys the protection of our law, his or her status, rights and immunities under the law differ from those of an Australian citizen in a number of important respects. Relevantly, the most important difference lies in the vulnerability, arising under the common law and provisions of the Constitution, of an alien to exclusion or deportation. The effect is significantly to diminish the protection which Ch III provides a citizen against detention otherwise than pursuant to judicial power. The sovereign power to make laws providing for the expulsion and deportation of aliens extends to authorising the Executive to restrain them in custody to the extent necessary to make their deportation effective39. 34 (1982) 151 CLR 101; [1982] HCA 60. 35 Pochi v Macphee (1982) 151 CLR 101 at 111, 112, 116. 36 Pochi v Macphee (1982) 151 CLR 101 at 111. 37 Australia, House of Representatives, Migration Legislation Amendment Bill 1994, Explanatory Memorandum at 9 [24]. 38 Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 29-30. 39 Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 30-31; see also Koon Wing Lau v Calwell (1949) 80 CLR 533; [1949] HCA 65. Bell Edelman The plaintiff understates the importance of his status as an alien and the scheme of the Migration Act as directed to him as a person having that status. Section 501(3A) purports to confer judicial power on the Minister The plaintiff's fourth, and central, proposition is that s 501(3A) purports to invest the judicial power of the Commonwealth in the Minister and his delegates. In support of this proposition, the plaintiff points to what he contends are features of judicial power in s 501(3A) and he submits that the extrinsic materials confirm that the purpose of his detention is punishment. The principal feature of judicial power which the plaintiff identifies is the conclusiveness, in the sense of finality, of a cancellation decision. It is reinforced by the fact that merits review is not available, no interlocutory release is possible, the decision may be made on the basis of information which is protected from publication and the decision to revoke is wholly discretionary. It may be accepted that, unless a decision is made to revoke an otherwise valid cancellation decision, it has consequences for the detention and removal of the non-citizen and is "final" in that sense. The same consequences attend the exercise of the other powers under s 501. The plaintiff does not suggest that ss 501(1) and 501(2) infringe Ch III or that they are punitive in the relevant sense. The plaintiff seeks to distinguish s 501(3A) from ss 501(1) and 501(2) because s 501(3A) is mandatory in its terms. If the conditions for its exercise are present, the Minister is obliged to cancel the visa. The matters which are taken into account in the exercise of the discretion provided in the other provisions are not addressed where a person's visa is cancelled under s 501(3A) until consideration is given to revocation of the cancellation decision. The defendant correctly points out that it does not follow from the premise that a discretionary determination involves no exercise of judicial power that a legislative determination which mandates that certain offending (or certain levels of offending) results in cancellation necessarily involves the exercise of judicial power. In other words, a permissive/mandatory dichotomy is not useful to mark a power as punitive in nature or purpose. In any event, there is nothing to prevent Parliament from legislating by reference to a class of persons, rather than on a basis which requires a case-by-case approach. Section 501(3A) constitutes a legislative judgment that a class of persons identified by two features – offending and imprisonment – are not to remain in Australia. This is consistent with the Bell Edelman object of the Migration Act, namely, to regulate the coming into and presence in Australia of non-citizens40. The plaintiff relies upon the operation of s 501(3A) as being based upon a primary and characteristic factum that the person has committed an offence or offences, and the further factum that, at the time the power is exercised, the person is in criminal detention, as showing that s 501(3A) is concerned with punishment for and by reference to criminal offending additional to that imposed by a court. Moreover, before the power is exercised, the Minister must reach a positive state of satisfaction in relation to the prior offending. The exercise of a power of cancellation of a visa by reference to the fact of previous criminal offending does not involve the imposition of a punishment for an offence and does not involve an exercise of judicial power. It has long been recognised that the deportation of aliens does not constitute punishment. The cancellation of a visa as a step necessary to achieve the removal of a person from Australia should be viewed in the same light. In Ex parte Walsh and Johnson; In re Yates41, Isaacs J drew a distinction between punishment for a crime and deportation as a political precaution carried out by the Executive. In O'Keefe v Calwell42, Latham CJ referred to the deportation of a convicted immigrant as a measure of protection of the community and not as punishment for any offence. The power to cancel a visa by reference to a person's character, informed by their prior offending, is not inherently judicial in character. It operates on the status of the person deriving from their conviction43. By selecting the objective facts of conviction and imprisonment, Parliament does not seek to impose an additional punishment. In the Explanatory Memorandum44 to the Bill which introduced s 501(3A) it was said that "[t]he intention of this amendment is that a decision to cancel a 40 Migration Act 1958 (Cth), s 4(1). 41 (1925) 37 CLR 36 at 96; [1925] HCA 53. 42 (1949) 77 CLR 261 at 278; [1949] HCA 6. 43 Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 610 [74]. 44 Australia, House of Representatives, Migration Amendment (Character and General Visa Cancellation) Bill 2014, Explanatory Memorandum at 8 [34]. Bell Edelman person's visa is made before the person is released from prison, to ensure that the non-citizen remains in criminal detention or, if released from criminal custody, in immigration detention while revocation is pursued". In the course of the Second Reading Speech the then Minister said that s 501(3A) was calculated to ensure that "noncitizens who pose a risk to the community will remain in either criminal or immigration detention until they are removed or their immigration status is otherwise resolved"45. It may be accepted that these extrinsic materials show an awareness on the part of the Parliament about the operation of s 501(3A) in the statutory scheme and that one of its purposes is to keep the person out of the community until he or she is removed from Australia. Such a purpose is consistent with those of the other cancellation powers in s 501. The extrinsic materials do not reveal any purpose to ensure that a person is detained in order to punish them. The observation in O'Keefe v Calwell, referred to above, provides part of the answer to the plaintiff's contention that s 501(3A) does not involve the pursuit of a protective purpose. The plaintiff submits that the Minister is neither obliged nor permitted to have regard to the protection of the Australian community or any other protective considerations when deciding to cancel a visa and that these matters do not arise for consideration until a decision as to whether to revoke the cancellation decision under s 501(3A) is made. The fact that the Minister is not obliged to consider the need to protect the community when determining whether to cancel a visa in the circumstances provided by s 501(3A) is not determinative of that provision's purpose. The defendant submits that, consistently with s 501, of which it forms part, its purpose is to exclude from the Australian community, by means of visa cancellation, a category of aliens which the Parliament has determined should not be part of the community due to their record of criminal offending. The criteria of which the Minister must be satisfied are those upon which a sovereign State may properly decide to exclude non-citizens in the interest of protecting the peace, order and good government of the Commonwealth. That submission should be accepted. None of the plaintiff's arguments which have been dealt with to this point address the question whether s 501(3A) actually authorises or requires the plaintiff's detention. They proceed upon an assumption that it does. On its face 45 Australia, House of Representatives, Parliamentary Debates (Hansard), 24 September 2014 at 10328. Bell Edelman s 501(3A) is simply a provision which mandates the cancellation of a visa if the conditions stated are present. The plaintiff submits that s 501(3A) may nevertheless be seen as concerned with punishment because it exposes a person who qualifies for cancellation to detention. It will also be recalled that the plaintiff contends that, regardless of its terms, the legal operation and effect of the provision extend his punishment beyond what has been ordered by a court. In the latter respect, the plaintiff argues that s 501(3A) has the effect that a person is detained for a period after the conclusion of his or her criminal detention whilst consideration is given to whether to revoke a cancellation decision. On this argument there is a period, or periods, after a cancellation decision when a person is not being detained for the purpose of removal under s 189, but is detained for the purpose of the revocation process. The minimum period for detention for the latter purpose is the period between the cancellation decision and the date by which the person the subject of the visa cancellation must apply for revocation under s 501CA, namely 28 days. If the person applies for revocation the period extends to the date of the decision or revocation, in the plaintiff's case 10 months. These submissions fail to take account of the statutory scheme and the effect of a cancellation decision. A cancellation decision has the immediate effect that the person's status is changed from that of a lawful non-citizen to an unlawful non-citizen. Section 501(3A) merely provides the basis for the change in status. It does not authorise detention. It is that new status that exposes the person to detention under s 189. The person is liable to removal from Australia and to detention for that purpose from the time that a cancellation decision is made. The possibility that a cancellation decision might be revoked, so that that decision may be taken not to have been made46, does not alter the fact that the person retains the status of an unlawful non-citizen for the whole of the period in question, from the time of the cancellation decision to the making of the revocation decision. Where a person seeks revocation, his or her detention for the purpose of removal will be prolonged by his or her act in applying for reconsideration of the decision to cancel his or her visa. Section 501CA provides a process by which it may be decided whether a cancellation decision under s 501(3A) should be revoked, but neither it nor s 501(3A) authorises or requires detention for the 46 Migration Act 1958 (Cth), s 501CA(5). Bell Edelman purpose of that process being undertaken. Section 196 expressly deals with the duration of immigration detention arising in these circumstances. It will be recalled that s 196(4) provides that the detention of a person who is detained as a result of the cancellation of his or her visa is to continue unless a court finally determines either that the detention is unlawful or that the person detained is not an unlawful non-citizen. The plaintiff submits that, "loosely speaking", a cancellation decision under s 501(3A) may have the effect of "converting" criminal detention into immigration detention. He refers to the possibility that the two detentions might operate concurrently. The circumstance that he envisages is where a non-citizen was sentenced to some years of imprisonment, but his or her visa is cancelled during the first week of that term. Criminal detention cannot be "converted" into immigration detention. A person is imprisoned by order of the court which authorises his or her detention by the State following conviction for an offence against the laws of the State. A person so detained cannot be said to be detained by an officer acting under s 189 of the Migration Act. The possibility that, in the circumstance to which the plaintiff refers, a person might be a prisoner serving a term of imprisonment for an offence and an unlawful non-citizen liable to be detained and removed from Australia as soon as reasonably practicable points to a possible tension between the provisions of Commonwealth, State and Territory laws and the Migration Act. The Migration Act contains provisions intended to address that problem. The provisions of Pt 2, Div 4 permit a non-citizen to stay in Australia for the purposes of the administration of justice47, which is defined to include punishment, by way of imprisonment of a person, for the commission of an offence48. The focus of the Division is on maintaining the presence in Australia of persons who would not otherwise be permitted to enter or remain here49. It is not necessary to detail each of the provisions of Pt 2, Div 4. It is sufficient to observe that they involve the grant by the Commonwealth Attorney- 47 Migration Act 1958 (Cth), s 141. 48 Migration Act 1958 (Cth), s 142. 49 Minister for Immigration and Citizenship v Zhang (2009) 179 FCR 135 at 146 [97]. Bell Edelman General or an official of a State of a criminal justice certificate50 which has the effect that, during its currency, the person is not to be removed or deported from Australia51 and the issue of a warrant by a court to stay the removal or deportation of a non-citizen52. If a criminal justice certificate or a criminal stay warrant is in force the Minister may consider the grant of a criminal justice visa53. The possibility of the concurrent operation of the Migration Act with criminal detention does not arise in the plaintiff's case, since it is acknowledged that he was taken into immigration detention at the conclusion of his non-parole period. Conclusion and orders Section 501(3A) did not authorise or require the detention of the plaintiff. It required that a visa granted to him as a non-citizen be cancelled on account of his criminal history and his imprisonment. The change in his legal status to that of an unlawful non-citizen had the effect that he was liable to removal from Australia and to detention to facilitate that removal. That is the scheme of the Migration Act. The plaintiff's application should be dismissed with costs. 50 Migration Act 1958 (Cth), ss 147 and 148. 51 Migration Act 1958 (Cth), s 150. 52 Migration Act 1958 (Cth), s 151. 53 Migration Act 1958 (Cth), s 159(1). GagelerJ GAGELER AND GORDON JJ. The plaintiff, Mr Falzon, is a national of Malta who arrived in Australia on 29 February 1956. Between 1 September 1994 and 10 March 2016, the plaintiff held an Absorbed Person visa. On 26 June 2008, the plaintiff was convicted of one count of trafficking a large commercial quantity of cannabis. He was sentenced to 11 years' imprisonment with a non-parole period of eight years. On 10 March 2016, shortly before the plaintiff was due to be released from criminal custody, a delegate of the defendant – the Minister for Immigration and Border Protection ("the Minister") – cancelled the plaintiff's visa under s 501(3A) of the Migration Act 1958 (Cth) ("the Act"). Upon being released from criminal custody on 14 March 2016, the plaintiff was taken into immigration detention, where he has since remained. On 15 March 2016, the plaintiff sought to have the delegate's decision to cancel his visa revoked under s 501CA(4) of the Act. On 10 January 2017, the Assistant Minister decided not to revoke the delegate's decision. Section 501(3A) of the Act requires the Minister to cancel a non-citizen's visa if the Minister is satisfied that the non-citizen has a "substantial criminal record" and is serving a full-time custodial sentence. The plaintiff contended that s 501(3A) purports to confer the judicial power of the Commonwealth on the Minister, contrary to Ch III of the Constitution. That contention was put in two broad ways: first, an exercise of s 501(3A) "results in" or "causes" detention for a punitive purpose contrary to the limitations identified in Chu Kheng Lim v Minister for Immigration54; and second, the power conferred by s 501(3A) took on a judicial character because of, among other things, the nature of the criteria which enlivened the duty to exercise it. The plaintiff's contention is untenable. The principle in Lim concerning the limits on the executive detention of non-citizens is only concerned with laws that require or authorise detention and has no broader operation. Section 501(3A) neither requires nor authorises the detention of non-citizens. The provisions that require and authorise the detention of unlawful non-citizens are found in Div 7 of Pt 2 of the Act. None of those provisions was challenged by the plaintiff. The fact that a person whose visa is cancelled under s 501(3A) will become liable to detention is not enough to attract the principle in Lim. Moreover, s 501(3A) does not otherwise confer judicial power on the Minister. 54 (1992) 176 CLR 1 at 32-33; [1992] HCA 64. GagelerJ Statutory framework The object of the Act is "to regulate, in the national interest, the coming into, and presence in, Australia of non-citizens"55. To advance that object, the Act "provides for visas permitting non-citizens to enter or remain in Australia" and states that the Parliament intends that the Act "be the only source of the right of non-citizens to so enter or remain"56. The Act also "provides for the removal or deportation from Australia of non-citizens whose presence in Australia is not permitted by [the] Act"57. Section 501 contains powers to refuse or cancel a visa on character grounds. Sub-sections (1), (2) and (3) identify circumstances in which the Minister may refuse to grant a visa to a person or may cancel a visa that has been granted to a person. The operation of each sub-section depends on the Minister forming an opinion or state of satisfaction about whether the person passes the statutory "character test". Section 501(3A) is in different terms. It relevantly provides that the Minister must cancel a person's visa if: the Minister is satisfied that the person does not pass the character test because of the operation of: paragraph (6)(a) (substantial criminal record), on the basis of paragraph (7)(a), (b) or (c); or (ii) …; and the person is serving a sentence of imprisonment, on a full-time basis in a custodial institution, for an offence against a law of the Commonwealth, a State or a Territory." The sub-section imposes an obligation on the Minister to cancel a visa whenever its terms are met58. If the pre-conditions to the exercise of the power exist, the Minister does not have a discretion to decide not to consider exercising the power in s 501(3A). 55 s 4(1) of the Act. 56 s 4(2) of the Act. 57 s 4(4) of the Act. 58 See s 33(1) of the Acts Interpretation Act 1901 (Cth). GagelerJ The circumstances in which a person does not pass the character test are set out in s 501(6). Section 501(6)(a) provides that a person does not pass the character test if the person has a "substantial criminal record", as defined by s 501(7). Relevantly, s 501(7)(c) provides that a person has a substantial criminal record if the person has been sentenced to a term of imprisonment of 12 months or more. A decision to cancel a visa pursuant to s 501(3A) may be revoked under s 501CA. As soon as practicable after making a decision to cancel a person's visa, the Minister must give the person notice of the cancellation decision and particulars of the information on which the decision was based, and invite the person to make representations to the Minister about revocation of the cancellation decision59. If the person makes representations in accordance with the invitation, and the Minister is satisfied that the person passes the character test or that there is another reason why the cancellation decision should be revoked, the Minister may revoke the cancellation decision60. The Act draws a distinction between lawful non-citizens and unlawful non-citizens. A non-citizen in the migration zone61 who holds a visa that is in effect is a lawful non-citizen62. Any other non-citizen in the migration zone is an unlawful non-citizen63. A lawful non-citizen whose visa is cancelled becomes an unlawful non-citizen immediately upon cancellation64. The scheme for the mandatory detention and removal of unlawful non-citizens is found in Divs 7 and 8 of Pt 2 of the Act. Division 7, entitled "Detention of unlawful non-citizens", includes s 189(1), which provides that an officer who knows or reasonably suspects that a person in the migration zone (other than an excised offshore place) is an unlawful non-citizen must detain the person. Section 196 governs the duration of the detention of a person detained under s 189. Section 196(1) relevantly provides that an unlawful non-citizen 59 s 501CA(2) and (3) of the Act. 60 s 501CA(4) of the Act. 61 See the definition of "migration zone" in s 5(1) of the Act. 62 s 13 of the Act. 63 s 14 of the Act. 64 s 15 of the Act. GagelerJ detained under s 189 must be kept in immigration detention until removed, deported or granted a visa. Section 196(4) expressly deals with the detention of non-citizens whose visas are cancelled under s 501 of the Act65 and relevantly provides that: "if the person is detained as a result of the cancellation of his or her visa under section 501, the detention is to continue unless a court finally determines that the detention is unlawful, or that the person detained is not an unlawful non-citizen." (emphasis added) As is evident from s 196(1), the potential removal of an unlawful non-citizen constitutes one of the bounds on the duration of detention. The removal of unlawful non-citizens is dealt with in Div 8. Section 198(5) provides that an officer must remove as soon as reasonably practicable an unlawful non-citizen if the non-citizen is a detainee and, relevantly, did not apply for a substantive visa under s 195(1). Section 198(2B), inserted into the Act by Item 11 of Sched 1 to the Migration Amendment (Character Cancellation Consequential Provisions) Act 2017 (Cth) ("the Amendment Act"), provides: "An officer must remove as soon as reasonably practicable an unlawful non-citizen if: a delegate of the Minister has cancelled a visa of the non-citizen under subsection 501(3A); and since the delegate's decision, the non-citizen has not made a valid application for a substantive visa that can be granted when the non-citizen is in the migration zone; and in a case where the non-citizen has been invited, in accordance with section 501CA, to make representations to the Minister about revocation of the delegate's decision—either: the non-citizen has not made representations in accordance with the invitation and the period for making representations has ended; or the non-citizen has made representations in accordance with the invitation and the Minister has decided not to revoke the delegate's decision." 65 See also s 196(5) of the Act. GagelerJ It commenced on 23 February 201766 and applies in relation to a decision under s 501(3A) of the Act made before or after its commencement and to an invitation under s 501CA of the Act given before or after its commencement67. No conferral of judicial power The provisions of Ch III of the Constitution constitute "an exhaustive statement of the manner in which the judicial power of the Commonwealth is or may be vested"68. As a corollary, the grants of legislative power in s 51 of the Constitution "do not permit the conferral upon any organ of the Executive Government of any part of the judicial power of the Commonwealth"69. One important consequence of these principles, which were restated in Lim, is that the Parliament's legislative power to provide for the executive to be able to effect compulsory detention, and associated trespass to the person, without judicial order is limited70. Lim establishes that the power to require or authorise the executive to detain a non-citizen is limited. The "constitutional holding" in Lim was described in Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship in the following terms71: "[T]hat laws authorising or requiring the detention in custody by the executive of non-citizens, being laws with respect to aliens within s 51(xix) of the Constitution, will not contravene Ch III of the Constitution, and will therefore be valid, only if: 'the detention which they require and authorise is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to 66 s 2(1) of the Amendment Act. 67 Item 22(3) of Sched 1 to the Amendment Act. 68 Lim (1992) 176 CLR 1 at 26 quoting R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270; [1956] HCA 10. 69 Lim (1992) 176 CLR 1 at 27. 70 (1992) 176 CLR 1 at 32; Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 69-70 [40], 86 [98], 160 [379]-[381]; [2016] HCA 1. 71 (2013) 251 CLR 322 at 369 [138]; [2013] HCA 53 (footnote omitted). GagelerJ enable an application for an entry permit to be made and considered.'" (emphasis added) The reason that such laws are valid is that detention for those purposes is "neither punitive in nature nor part of the judicial power of the Commonwealth"72. Consideration of these well-established principles directs attention to s 501(3A). Contrary to the plaintiff's contention, that provision does not confer the judicial power of the Commonwealth on the Minister contrary to Ch III of the Constitution. The starting point in assessing the plaintiff's contention about the constitutional validity of s 501(3A) is to identify the legal effect and practical operation of the provision73. That inquiry yields the conclusion that s 501(3A) neither requires nor authorises the detention of non-citizens. Both legally and practically, s 501(3A) requires the Minister to cancel the visas of certain non-citizens in certain circumstances. Once a visa is cancelled under s 501(3A), the visa holder becomes an unlawful non-citizen74. At that point, and by reason of that status, s 189 requires the person to be taken into immigration detention. The duration of their detention is then governed by s 196. The consequences of a person becoming an unlawful non-citizen, including the requirement that the person be detained and the prescribed duration of that detention, are not found in s 501(3A); they are addressed elsewhere in the Act. In this case, a decision was made under s 501(3A) to cancel the plaintiff's visa on 10 March 2016, and the plaintiff was subsequently invited to make representations about the revocation of that decision. The plaintiff's detention arose from the legal effect and practical operation of s 189 and s 196(1), (4) and (5) of the Act, not s 501(3A). At all times while the plaintiff has been detained, the Act has imposed a duty on an officer to remove the plaintiff as soon as reasonably practicable. When the plaintiff was first taken into immigration detention on 14 March 2016, the obligation to remove him was to be found in s 198(5) of the Act, because he had not applied for a visa under s 195(1)75. In addition, the effect of s 198(2B) is 72 Lim (1992) 176 CLR 1 at 32 (footnote omitted). See also Plaintiff M68/2015 (2016) 257 CLR 42 at 69-70 [40], 86 [98], 160 [381]. 73 See Plaintiff S156/2013 v Minister for Immigration and Border Protection (2014) 254 CLR 28 at 42 [23]; [2014] HCA 22. 74 s 15 of the Act. 75 See s 198(5)(b) of the Act. GagelerJ that it applies "in relation to" both the decision to cancel the plaintiff's visa and the invitation issued to the plaintiff to make representations about revocation76. Since its commencement, that sub-section has imposed an obligation on an officer to remove the plaintiff as soon as reasonably practicable following the decision not to revoke the cancellation of his visa. In short, the principle in Lim is engaged only by laws that require or authorise detention. Section 501(3A) does not take on that character, and does not engage the principle in Lim, simply because a person whose visa is cancelled under that provision becomes liable to be detained under different provisions (none of which were themselves suggested to be invalid). What s 501(3A) does is to require the cancellation of a visa in certain circumstances. It confers a power, which the Minister has a duty to exercise, to determine whether a non-citizen can enter, or remain in, Australia. That power is administrative in character. It forms no part of the judicial power of the Commonwealth. In particular, the exercise of that power does not trespass on the exclusively judicial function of determining or punishing criminal guilt77. The Parliament has a broad choice as to the factum upon which a power to cancel a visa will operate. The factum relevantly identified in s 501(3A) is the Minister's state of satisfaction that a non-citizen has a "substantial criminal record" and is serving a full-time custodial sentence. The need for a person to have a substantial criminal record and to be serving a custodial sentence does not mean that the cancellation of a visa is directed to the imposition of punishment for criminal guilt. The purpose of cancelling a visa pursuant to s 501(3A) is to exclude from the Australian community a class of persons who, in the view of the Parliament, should not be permitted to remain in Australia. Cancellation of a visa for that purpose does not involve any determination or punishment of criminal guilt and does not involve the exercise of judicial power. Finally, the plaintiff sought to identify a large assortment of matters which showed that a decision under s 501(3A) had a "significant degree of conclusiveness". Whatever that phrase is intended to connote, the burden of the plaintiff's challenge is to show that judicial power has been conferred. The matters identified – for example, that the avenues for review of a purported decision under s 501(3A) are limited, that the rules of natural justice do not apply 76 Item 22(3) of Sched 1 to the Amendment Act. 77 See Lim (1992) 176 CLR 1 at 27; Magaming v The Queen (2013) 252 CLR 381 at 396 [47], 399 [61], 413 [100]; [2013] HCA 40; Kuczborski v Queensland (2014) 254 CLR 51 at 120 [233]; [2014] HCA 46; Duncan v New South Wales (2015) 255 CLR 388 at 407 [41]; [2015] HCA 13. GagelerJ to a decision under s 501(3A)78 and that the Minister has a discretion rather than a duty to revoke a decision to cancel a visa – do not show, individually or together, that the cancellation of a visa under s 501(3A) involves an exercise by the Minister of judicial power. We agree that the plaintiff's application should be dismissed with costs. 78 s 501(5) of the Act. Nettle NETTLE J. I agree with Gageler and Gordon JJ but wish to add the following. As a sovereign nation, Australia has the sole right to decide which non-citizens shall be permitted to enter and remain in this country79. Consequently, as was decided in Robtelmes v Brenan80 and has ever since been regarded as settled law81, Parliament has power under s 51(xix) of the Constitution to make laws for the deportation of non-citizens for whatever reason Parliament thinks fit. And, as Gibbs CJ observed82 in Pochi v Macphee, it is only to be expected that it should be so; for such a power is essential to national security. By s 501(3A) of the Migration Act 1958 (Cth), Parliament has conferred on the Minister for Immigration and Border Protection one of a number of powers calculated to give effect to Australia's sovereign right to determine which non-citizens shall be permitted to remain in this country. Relevantly, the factum of its operation is that the Minister be satisfied that the subject non-citizen does not pass the "character test" because he or she has been sentenced to death, sentenced to life imprisonment or sentenced to a term of imprisonment of 12 months or more, or because he or she has been convicted or found guilty of one or more sexually based offences involving a child, and the subject non-citizen is serving a sentence of imprisonment on a full-time basis in a custodial institution. Contrary to the plaintiff's submissions, however, it does not follow that the provision imposes a punishment. Deportation may be burdensome and severe for a non-citizen, and, in the plaintiff's case, I have no doubt it will be. But s 501(3A), either alone or by reference to ss 189 and 196, does not increase the punishment for the crime or crimes of which the non-citizen has been convicted or found guilty. Punishment in the relevant sense consists of the measures taken in the name of society to exact just retribution on those who have offended against the laws of society and thus, it is hoped, to facilitate their rehabilitation83. By 79 See Attorney-General for Canada v Cain [1906] AC 542 at 546; Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 29 per Brennan, Deane and Dawson JJ (Mason CJ relevantly agreeing at 10); see also at 44-45 per Toohey J, 64-65 per McHugh J; [1992] HCA 64. 80 (1906) 4 CLR 395 at 404 per Griffith CJ, 415 per Barton J, 418-419 per O'Connor J; [1906] HCA 58. 81 Pochi v Macphee (1982) 151 CLR 101 at 106 per Gibbs CJ (Mason J and Wilson J agreeing at 112, 116); [1982] HCA 60. 82 (1982) 151 CLR 101 at 106. 83 See Veen v The Queen [No 2] (1988) 164 CLR 465 at 473-474 per Mason CJ, Brennan, Dawson and Toohey JJ, 490-491 per Deane J; [1988] HCA 14. See also (Footnote continues on next page) Nettle contrast, powers of the kind conferred on the Minister by s 501(3A) give effect to Parliament's right to rid the nation of persons who, in the judgment of the Parliament, have shown by their offending that their continued presence here would be opposed to the safety and welfare of the nation. Powers of such a kind are measures for the protection of society84. As Isaacs J said85 in Ex parte Walsh and Johnson; In re Yates: "[D]eportation as a means of self-protection in relation to constitutional functions is within the competency of the legislative organ of the Australian people. This nation cannot have less power than an ordinary body of persons, whether a State, a church, a club, or a political party who associate themselves voluntarily for mutual benefit, to eliminate from their communal society any element considered inimical to its existence or welfare." Given that the plaintiff came to this country as a three-year-old child more than 60 years ago, it might be thought that whatever risk he now poses to the safety and welfare of the nation is one that the nation should bear. In general, however, it is for Parliament to select the "trigger" for legislative consequences and especially so in the case of deportation86. It is not the role of this Court to say that the criteria of deportation are overly harsh or unduly burdensome or otherwise disproportionate to the risk to the safety and welfare of the nation posed by the subject non-citizen remaining in this country. Contrary to the plaintiff's submissions, there is no constitutionally guaranteed freedom from executive detention such that legislative provisions for the deportation of non-citizens and their consequent detention must be justified as appropriate and adapted or proportionate to a non-punitive end. At least in this context, Al-Kateb v Godwin (2004) 219 CLR 562 at 650-651 [264]-[268] per Hayne J; [2004] HCA 37. 84 Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 95-96 per Isaacs J; [1925] HCA 53; O'Keefe v Calwell (1949) 77 CLR 261 at 278 per Latham CJ; [1949] HCA 6. See also Mahler v Eby 264 US 32 at 39-40 (1924). 85 (1925) 37 CLR 36 at 94. 86 Baker v The Queen (2004) 223 CLR 513 at 522 [9] per Gleeson CJ, 532 [43] per McHugh, Gummow, Hayne and Heydon JJ, 571 [170] per Callinan J; [2004] HCA 45; Ex parte Walsh (1925) 37 CLR 36 at 94-96 per Isaacs J. Nettle proportionality analysis of the kind essayed in McCloy v New South Wales87 and more recently applied in Brown v Tasmania88 has no role to play. As Gageler and Gordon JJ observe89, the effect of the Minister cancelling a non-citizen's visa under s 501(3A) of the Migration Act is to change the status of the non-citizen from lawful non-citizen to unlawful non-citizen. Thereupon the unlawful non-citizen is liable to be detained under s 189 for removal from Australia, as soon as reasonably practicable under s 196(1) in accordance with s 198, unless the Minister revokes the original decision to cancel the non-citizen's visa in accordance with s 501CA(4). But contrary to the plaintiff's submissions, the fact that s 501(3A) provides for mandatory cancellation of a visa, rather than cancellation at the discretion of the Minister, does not mean that the non-citizen's consequent detention under s 189 is punitive. Detention derives its character from its purpose90, and, in light of the decision of this Court in Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs91, there can be no doubt that immigration detention under s 189 is valid as reasonably capable of being seen as necessary for the purpose of removing a non-citizen from Australia. It is not punitive and it involves no exercise of judicial power. Moreover, contrary to the plaintiff's submissions, it makes no difference that it cannot be known at the commencement of the detention whether the Minister will revoke the original decision. Logically, and at law, the detention is from the outset for the purpose of ensuring that the non-citizen will be available for removal from Australia as soon as reasonably practicable, and logically, and at law, the detention will retain that character until and unless the Minister revokes the original decision to cancel the visa. 87 (2015) 257 CLR 178; [2015] HCA 34. 88 (2017) 91 ALJR 1089; 349 ALR 398; [2017] HCA 43. 89 See above at [84]. 90 Al-Kateb v Godwin (2004) 219 CLR 562 at 584 [45] per McHugh J, 660 [294] per Callinan J; Re Woolley; Ex parte Applicants M276/2003 (2004) 225 CLR 1 at 25-26 [60] per McHugh J, 61 [167] per Gummow J, 85 [261]-[262] per Callinan J; [2004] HCA 49; Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship (2013) 251 CLR 322 at 385 [206]-[207] per Kiefel and Keane JJ; [2013] HCA 53. 91 (1992) 176 CLR 1 at 33 per Brennan, Deane and Dawson JJ (Mason CJ relevantly agreeing at 10), 46-47 per Toohey J, 65 per McHugh J. See also Al-Kateb v Godwin (2004) 219 CLR 562 at 573 [4] per Gleeson CJ, 583 [41]-[42], 584 [45], 595 [74] per McHugh J, 604-605 [110], 613 [139] per Gummow J, 644 [245], 648 [255], 649 [259]-[260] per Hayne J. Nettle Of course, if the Minister does revoke the original decision to cancel the visa, the status of the non-citizen will once again become that of a lawful non-citizen and the non-citizen will thereupon cease to be "[a]n unlawful non-citizen detained under section 189" within the meaning of s 196(1). In that event, the detention should cease. Section 501CA(5) provides that revocation under s 501CA(4) of an original decision to cancel a visa under s 501(3A) has the effect that the original decision is taken not to have been made, with the result in effect that the non-citizen is taken always to have been a lawful non-citizen (albeit that, perforce of s 501CA(6), the detention that occurred between the making of the original decision and the revocation of the original decision is deemed to have been lawful). When that occurs, the non-citizen is to be released from detention pursuant to s 196(2) and, if not released, will have the right to apply to the court for relief, as is contemplated in s 196(4). Nevertheless, it will remain that, for so long as the original decision to cancel the visa was on foot, and thus for so long as the non-citizen was lawfully detained, he or she was detained for the purpose of ensuring availability for removal from Australia as soon as reasonably practicable. The plaintiff's application should be dismissed with costs.
HIGH COURT OF AUSTRALIA FAIR WORK OMBUDSMAN APPELLANT AND QUEST SOUTH PERTH HOLDINGS PTY LTD & ORS RESPONDENTS Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd [2015] HCA 45 2 December 2015 ORDER Appeal allowed. Set aside the order of the Full Court of the Federal Court of Australia made on 17 March 2015 and, in its place, order that: the appeal be allowed; that, the order of McKerracher J made on 26 July 2013 be varied paragraphs 1 and 2 of the order, the following declarations are made: the declarations contained in addition "2A. The first respondent contravened s 357 of the Act by representing to Ms Margaret Best that the contract of employment under which she was employed by the first respondent was a contract for services under which she performed work as an independent contractor"; "2B. The first respondent contravened s 357 of the Act by representing to Ms Carol Roden that the contract of employment under which she was employed by the first respondent was a contract for services under which she performed work as an independent contractor"; and the proceeding be remitted to a judge of the Federal Court for further hearing to determine any pecuniary penalties to be those imposed on contraventions. first respondent in respect of the On appeal from the Federal Court of Australia Representation J L Bourke QC with J M Firkin for the appellant (instructed by Clayton Utz) No appearance for the first respondent R C Kenzie QC with S E J Prince for the second respondent (instructed by Ashurst Australia) Submitting appearance for the third respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd Employment law – Employer and employee – Independent contractor – Sham arrangements – Fair Work Act 2009 (Cth), s 357(1) prohibits representation by employer to employee that contract of employment under which individual is employed is contract for services – First respondent represented that employees performed work as independent contractors under contracts for services with second respondent – Whether first respondent contravened s 357(1). Words and phrases – "contract for services", "independent contractor", "sham arrangement". Fair Work Act 2009 (Cth), s 357. FRENCH CJ, KIEFEL, BELL, GAGELER AND NETTLE JJ. The question in this appeal is whether s 357(1) of the Fair Work Act 2009 (Cth) prohibits an employer from misrepresenting to an employee that the employee performs work as an independent contractor under a contract for services with a third party. For the reasons that follow, the answer to that question is in the affirmative and the appeal should be allowed. The Act Section 357 is within Div 6 of Pt 3-1 of the Act. An object of Pt 3-1 is "to protect workplace rights"1. The expression "workplace right" is defined to include benefits to which a person is entitled as an employee, under a workplace instrument or under the National Employment Standards set out in Pt 2-2 of the Act2. The heading to Div 6 forms part of the Act3. The heading is "Sham arrangements". Section 357 provides: "(1) A person (the employer) that employs, or proposes to employ, an individual must not represent to the individual that the contract of employment under which the individual is, or would be, employed by the employer is a contract for services under which the individual performs, or would perform, work as an independent contractor. Note: This subsection is a civil remedy provision (see Part 4-1). Subsection (1) does not apply if the employer proves that, when the representation was made, the employer: did not know; and (b) was not reckless as to whether; 1 Section 336(a) of the Act. 2 Section 341(1)(a) of the Act, read with the definitions of "workplace instrument" and "workplace law" in s 12 of the Act. 3 Section 13(1) of the Acts Interpretation Act 1901 (Cth), as in force on 25 June 2009. See s 30J of the Act. Bell Nettle the contract was a contract of employment rather than a contract for services." As a civil remedy provision within the meaning of Pt 4-1 of the Act, contravention of s 357(1) is not an offence4, but can give rise to civil proceedings for pecuniary penalty orders and other orders5. Those proceedings can be brought in the Federal Court of Australia or the Federal Circuit Court of Australia by a person affected by the contravention, by an industrial association or by a Fair Work Inspector6. The Fair Work Ombudsman has capacity as a Fair Work Inspector7. Procedural history and facts The Fair Work Ombudsman brought a proceeding in the Federal Court claiming, amongst other things, pecuniary penalty orders against Quest South Perth Holdings Pty Ltd ("Quest") for contraventions of s 357(1) of the Act. McKerracher J held at first instance that the proceeding was to be dismissed so far as it related to that claim8, and an appeal from that order was dismissed by the Full Court of the Federal Court (North, Barker and Bromberg JJ)9. This appeal, by special leave, is from that decision of the Full Court. 4 Section 549 of the Act. 5 Sections 545(1) and (2) and 546 of the Act. 6 Section 539 of the Act. 7 Section 701 of the Act. 8 Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (No 2) [2013] FCA 9 Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR Bell Nettle The Full Court found a number of uncontentious facts and reached a number of uncontroversial conclusions of law10. To the extent relevant to the appeal, they can be succinctly stated as follows. Quest operated a business of providing serviced apartments, in the course of which Quest had for some years employed Margaret Best and Carol Roden as housekeepers. Contracting Solutions Pty Ltd ("Contracting Solutions") operated a labour hire business. Quest and Contracting Solutions purported to enter into an arrangement of a kind which the Full Court described as a "triangular contracting" arrangement11. The arrangement had two components. First, Contracting Solutions purported to engage Ms Best and Ms Roden as independent contractors under contracts for services between them and Contracting Solutions. Next, Contracting Solutions purported to provide the services of Ms Best and Ms Roden as housekeepers to Quest under a labour hire agreement between Contracting Solutions and Quest. Quest, by its conduct, then represented to Ms Best and Ms Roden that they were performing work for Quest as independent contractors of Contracting Solutions. In fact, Ms Best and Ms Roden continued to perform precisely the same work for Quest in precisely the same manner as they had always done. In law, they never became independent contractors. At the time Quest represented that they were performing work for Quest as independent contractors of Contracting Solutions, they remained employees of Quest under implied contracts of employment. The Full Court indicated that it would have held Quest's representations to Ms Best and Ms Roden to be contraventions of s 357(1) had it construed that provision to extend to a representation by an employer to an employee that the employee performs work as an independent contractor under a contract for services with a third party12. 10 (2015) 228 FCR 346 at 353 [7]-[8], 356 [18], 356-357 [21], 357 [25], 358 [31], 361 11 (2015) 228 FCR 346 at 369 [96]. 12 (2015) 228 FCR 346 at 402 [240], 416 [335]-[336]. Bell Nettle Instead, the Full Court construed s 357(1) to have a much more confined operation. The Full Court held that, to contravene the provision, a representation by an employer to an employee must mischaracterise the contract of employment that exists between the employer and the employee "as a contract for services made between the employee and the employer"13. That construction, the Full Court considered, was compelled by the text of s 357(1), read in light of its purpose as illuminated by its legislative history14. We disagree. Resolving the question of construction The prohibition in s 357(1) is against an employer making a particular representation to an employee or prospective employee. The prohibited representation concerns the character of the contract, which exists or would exist between the employer and the employee as a contract of employment, under which the employee performs or would perform work. The content of the prohibited representation is that the contract of employment is or would be a contract for services under which the employee performs or would perform work as an independent contractor. Nothing in the language of s 357(1) warrants the construction that the representation prohibited by the provision is confined to a representation that the contract under which the employee performs or would perform work as an independent contractor is a contract for services with the employer. The reference in the provision to "the contract of employment under which the individual is, or would be, employed by the employer" is a reference to the object of the prohibited representation. It is not a reference to the content of the prohibited representation. The content of the prohibited representation is expressed in terms which require nothing more than that the contract which is the object of the representation "is a contract for services under which the individual performs, or would perform, work as an independent contractor". The provision is silent as to the counterparty to the represented contract for services. Who might be the counterparty to the represented contract for services, and whether that counterparty might be a real or fictional entity, is correspondingly immaterial to the operation of the provision. 13 (2015) 228 FCR 346 at 366 [77]. See also at 370 [100], 412 [307]-[308]. 14 (2015) 228 FCR 346 at 366-370 [80]-[99], 408-412 [281]-[306]. Bell Nettle To confine the prohibition to a representation that the contract under which the employee performs or would perform work as an independent contractor is a contract for services with the employer would result in s 357(1) doing little to achieve its evident purpose within the scheme of Pt 3-1. That purpose is to protect an individual who is in truth an employee from being misled by his or her employer about his or her employment status. It is the status of an employee which attracts the existence of workplace rights. To confine the prohibition in that way would, moreover, be to give the provision a capricious operation. An employer would be liable to pecuniary penalty if the employer said to an employee "you are employed by me as an independent contractor". The same employer would act with impunity if the employer said to the same employee "you are employed by X as an independent contractor". That would be so even if X were entirely fictitious. Either way, the employee would be misled by the employer to think that the employee was an independent contractor, and the extent of the practical denial of workplace rights would be the same. The legislative history contains nothing to compel the conclusion that the provision should be so confined. The explanatory memorandum for the Act explained s 357(1) as intended to restate in simplified terms the effect of ss 900 and 901 of the Workplace Relations Act 1996 (Cth) ("the 1996 Act")15. Those sections, which were introduced into the 1996 Act by the Workplace Relations Legislation Amendment (Independent Contractors) Act 2006 (Cth) ("the 2006 Act"), dealt respectively with an employer making a prohibited representation to an employee and a prospective employer making a prohibited representation to a prospective employee. The prohibited representation was expressed in each of those sections in materially identical terms. The terms in which the prohibited representation was expressed reflected, without resolving, the present issue of construction. The explanatory memorandum for the Bill for the 2006 Act is similarly inconclusive. There is a statement in the explanatory memorandum for the 2006 Act on which the Full Court placed weight16. The statement is that, in order to contravene s 900, a person "would need to have entered into a contract with an 15 Australia, House of Representatives, Fair Work Bill 2008, Explanatory Memorandum at 233 [1447]. 16 (2015) 228 FCR 346 at 368-369 [91]-[96]. Bell Nettle individual and have made a representation to that individual that the contract was a contract for services under which the individual would perform work as an independent contractor"17. That statement does not say, and does not suggest, that the person would need to have made a representation that the contract was a contract for services with that person as distinct from with someone else. the Bill for The explanatory memorandum for the Independent Contractors Act 2006 (Cth), which was enacted as part of the same legislative package as the 2006 Act, on the other hand, provides a strong indication that the purpose of the prohibition was to prevent misrepresentation as to the nature of the contract under which an employee performed work irrespective of who might be represented to be the counterparty to that contract. It will be remembered that the heading of the Division into which s 357 falls is "Sham arrangements". Sections 900 and 901 fell within a Part introduced into the 1996 Act by the 2006 Act which had the same heading18. Under that same heading in the explanatory memorandum for the Bill for the Independent Contractors Act, the relevant concept of a "sham arrangement" was explained to encompass "an arrangement through which an employer seeks to cloak a work relationship to falsely appear as an independent contracting arrangement in order to avoid responsibility for legal entitlements due to employees"19. It was recorded that courts had held that parties "cannot create something which has every feature of a rooster, but call it a duck and insist that everybody else recognise it as a duck"20. "Employees in disguised employment relationships", it was said, "should have appropriate remedies available to them"21. 17 Australia, House of Representatives, Workplace Relations Legislation Amendment (Independent Contractors) Bill 2006, Explanatory Memorandum at 5 [5]. 18 Part 22 of the 1996 Act. 19 Australia, House of Representatives, Independent Contractors Bill 2006, Explanatory Memorandum at 9. 20 Australia, House of Representatives, Independent Contractors Bill 2006, Explanatory Memorandum at 9, quoting Re Porter (1989) 34 IR 179 at 184. 21 Australia, House of Representatives, Independent Contractors Bill 2006, Explanatory Memorandum at 10. Bell Nettle The misrepresentation attributed to Quest was squarely within the scope of the mischief to which the prohibition in s 357(1) was directed and is caught by its terms. Orders The following orders should be made: Appeal allowed. Set aside the order of the Full Court of the Federal Court of Australia made on 17 March 2015 and, in its place, order that: the appeal be allowed; the order of McKerracher J made on 26 July 2013 be varied so that, in addition to the declarations contained in paragraphs 1 and 2 of the order, the following declarations be made: "2A. The first respondent contravened s 357 of the Act by representing to Ms Margaret Best that the contract of employment under which she was employed by the first respondent was a contract for services under independent which she performed work as an contractor"; "2B. The first respondent contravened s 357 of the Act by representing to Ms Carol Roden that the contract of employment under which she was employed by the first respondent was a contract for services under independent which she performed work as an contractor"; and the proceeding be remitted to a judge of the Federal Court for further hearing to determine any pecuniary penalties to be imposed on the first respondent in respect of those contraventions.
HIGH COURT OF AUSTRALIA APPELLANT AND WANDA MARY BOSTIN & LEOPOLDO RESPONDENTS VIGOLO (AS EXECUTORS OF THE WILL OF LINO VIGOLO DECEASED) & ORS Vigolo v Bostin [2005] HCA 11 9 March 2005 ORDER Appeal dismissed. The appellant pay the costs of the respondents as between party and party. The costs of the appeal of the first and second respondents be taxed on the trustee basis and, to the extent that those costs exceed the costs borne and paid by the appellant as between party and party, be paid out of the estate. On appeal from the Supreme Court of Western Australia Representation: R I Viner QC with P Mendelow for the appellant (instructed by SS Chohaan) M J Buss QC with L A Tsaknis for the respondents (instructed by Hudson Henning & Goodman) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Vigolo v Bostin Testator's family maintenance – Adequate provision for proper maintenance – Application by son of deceased – From 1973 to 1993 appellant made substantial contribution to deceased's family farming business – Deceased promised appellant that he would inherit family farm in return for his work in building up family assets – In 1993 relationship between appellant and deceased broke down – As a consequence parties entered Deed of Settlement to rearrange family affairs including ownership of family farm, which was purchased by the appellant and his wife – Deceased's will made no provision for the appellant – Jurisdictional left without adequate provision for his question – Whether appellant maintenance, education or advancement in life – Effect of Deed of Settlement on totality of relationship – Relevance of moral duty criterion. Words and phrases – "adequate provision from his estate for the proper maintenance, support, education or advancement in life" – "moral duty". Inheritance (Family and Dependants Provision) Act 1972 (WA), s 6. GLEESON CJ. The appellant made an application under the Inheritance (Family and Dependants Provision) Act 1972 (WA) ("the Act"). The application was dismissed by McLure J1. An appeal to the Full Court of the Supreme Court of Western Australia failed2. The further appeal to this Court should be dismissed. The decision of McLure J was correct. The appellant, an able-bodied adult son of the testator, and a man of substantial means, based his application, not upon financial need, but upon what was said to be a moral claim upon the testator's bounty, arising out of previous business and family dealings. His case failed, not because moral claims are irrelevant, but because he was unable to bring himself within the relevant provisions of the Act. The Act and moral claims The short title of the Act refers to provision for family and dependants. The long title describes it as an Act to make provision for the maintenance and support of the family and dependants of deceased persons out of the assets of the deceased's estate. The Act replaced the Testator's Family Maintenance Act 1939 (WA). In the second reading speech3, the Attorney-General for Western Australia referred to a legislative review proposed by the Law Society of Western Australia in 1965. A Law Reform Committee agreed with a proposal to extend the class of potential claimants under the legislation, and to deal not only with wills but also with intestacies or partial intestacies. The Attorney-General said: "It is considered that society's attitude to the right of a man, or of a woman, for that matter, to dispose of his or her property as he or she thinks fit ... beyond doubt has changed. There is now a feeling that a deceased is under some moral obligation to make provision for the maintenance, education, and advancement in life of persons who in the normal course of human affairs had a close personal relationship with the deceased. Unless provision is made there should be means to satisfy the court that some provision should be made. The decision to extend the right of application against intestacies or partial intestacies is a logical one. The terms of a will may be irrational or indeed immoral; but the same can apply where distributions of estates are made under a rule of law. For example, a wife who deserted her husband 1 Vigolo v Bostin [2001] WASC 335. 2 Vigolo v Bostin (2002) 27 WAR 121. 3 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 23 March 1972 at 273. and children could take the whole of a small estate at the expense of children maintained by the deceased, this being pursuant to the present law found in the Administration Act. Such a case is not uncommon and the same redress should be available to deserving claimants in an intestacy as is given to claimants under a will." The general structure of the Act follows a form familiar in all Australian States, and pioneered in New Zealand. The key provision is s 6. The power of a court to make an order under the Act is enlivened by the formation of an opinion that the disposition of the deceased's estate effected by will, or the law relating to intestacy, is not such as to make adequate provision from his estate for the proper maintenance, support, education or advancement in life of a person mentioned in s 7. The court is empowered, at its discretion, to order that such provision as the court thinks fit is made out of the estate of the deceased for that purpose. An order takes effect as a codicil to the will, or in the case of intestacy, as a modification to the applicable rules of distribution (s 10). What has been described as the two-stage approach to the exercise of such a statutory power was explained by this Court in Singer v Berghouse4, and is not in controversy in this appeal. It is evident that, depending upon the stage of consideration involved, the following judgments are required by the terms of s 6. What kind of provision for the matters referred to in that section should be regarded as adequate? What should be regarded as proper maintenance, support, education or advancement in life in the case of a particular applicant? If the court comes to exercise its discretion to make an order in favour of an applicant, what should it regard as fit provision for the purposes referred to in the section? Upon whom should the burden of such an order fall? Each of those judgments is to be made by reference to criteria that are expressed in the most general terms. Two of the key words are "proper" and "fit". Fitness and propriety are value-laden concepts. Those values must have a source external to the decision-maker. Morality is the source of many of the values that are expressed in the common law, in statutes, and in discretionary judicial decision-making. Section 7 of the Act sets out the categories of eligible claimants. Broadly speaking, they are spouses or de facto partners, children, grandchildren, and parents. However, the court may refuse to make an order in favour of an applicant on the ground that the applicant's character or conduct is such as in the opinion of the court to disentitle the applicant to the benefit of an order (s 6(3)). A value judgment is required. What is it about the character or conduct of an (1994) 181 CLR 201. eligible claimant that might disentitle him or her to the benefit of an order? Once again, the Act gives no specific guidance. These basic features of what is commonly called testator's family maintenance legislation have existed in Australia for almost a century. Such legislation is imbued with concepts of entitlement and disentitlement, claims and obligations, propriety and fitness, related to questions of inheritance. Australian courts, guided by decisions of this Court and of the Privy Council, have interpreted and applied the legislation by giving it a purposive construction. In its original form, the legislation conferred upon courts, in limited circumstances, a discretionary power to interfere with the exercise of freedom of testamentary disposition. Where such an interference was regarded as justified, it defeated the intention of a testator, and conferred a benefit upon an applicant at the expense of others whom the testator intended to benefit. From the beginning, a number of fundamental issues were obvious. Was this an extensive power to re-write a testator's will to make it conform to a judge's idea of how an estate should be distributed, or was it more limited, and, if so, in what way? Were issues of adequacy and propriety to be decided by reference only to minimum standards of subsistence? Was this merely a power to relieve the state of the burden of supporting indigent people? What account was to be taken of the expectations and needs of persons other than an applicant where a testator had made provision for such persons? In what circumstances should a testator's decision to disinherit a family member on grounds of character or conduct prevail? The legislation was typically entitled by reference to objects of "family maintenance" and "family protection". The New South Wales Act of 19165, according to its long title, was: "An Act to assure to the widow or widower and family of a testator an adequate maintenance from the estate of such testator". Jordan CJ, in In re Jacob Morris (Deceased)6, said: "[T]he Act is directed to making provision for the maintenance of members of a family who are found to be in need of such maintenance when the family tie has been broken by death." The original legislation was aimed primarily, although not exclusively, at the protection of women. In introducing the Bill for what became the 1916 Act, the New South Wales Attorney-General said7: "It is remarkable that in Australia, where the rights of women have developed so rapidly in the matter of property, we have wiped out 5 Testator's Family Maintenance and Guardianship of Infants Act, 1916 (NSW). (1943) 43 SR (NSW) 352 at 357. 7 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 3 August 1916 at 578. whatever right a woman has in the estate of her husband. The dower which existed here for many years exists no longer. It was abolished in the year 1890, and to-day a man may leave the whole of his property, both real and personal, to any stranger to whom he chooses to leave it. The wife may have been with him a partner for forty or fifty years. She may have assisted him in acquiring whatever wealth he possesses; yet he, dying, may will the property away and leave her dependent on the kindness of friends or the charity of the State. During his lifetime he cannot do that, for it is incumbent on him to maintain his wife. The object of the bill is to secure that after her husband's death the right of the wife to get sufficient from his estate to maintain her shall continue, and the right of his children shall be equally preserved." Plainly, this was not a complete account of the legal effect of the New South Wales Act. Yet it expressed the essence of the legislative purpose. The references to the rights of a wife or a child to maintenance after the death of a husband or father were not references to legal rights. The necessity for the legislation arose from the absence of such legal rights. The statute did not confer new rights of succession. It did not respond to the mischief identified by re- instating a right akin to dower, or otherwise by creating legal rights of inheritance. It preserved freedom of testamentary disposition, but subjected that freedom to a new qualification. The statute gave courts a discretionary power to make orders which would have the legal effect of altering the provisions of wills. Later, when expanded to cover cases of intestacy, it gave courts a discretionary power in effect to modify the statutory rules as to intestate succession. From the earliest days, courts in expounding the legislative purpose have invoked moral values. The reason is not difficult to see. The mischief to which the original legislation was directed was the possibility of unjust exercise of testamentary capacity resulting in inadequate provision for a family member, typically a widow. By hypothesis, the testator had the legal right to dispose of his estate as he thought fit, and the person or persons left without adequate provision had no legal right to inherit beyond the extent provided for in the will. The justification for conferring upon a court a discretionary power to intervene, and to make an order modifying the legal effect of the will, was explained in terms of familial obligation, not unnaturally or inappropriately described as moral. That concept was employed, (and, as has already been observed, was employed in 1972 to explain the Western Australian Act the subject of this appeal), not only to account for the power of curial intervention, but also to illuminate the legislative purpose bearing upon the nature and extent of appropriate intervention. For example, at an early stage in the history of the legislation there arose a question whether the object of intervention was limited to providing an applicant only with what was sufficient for basic subsistence, or whether it had a wider scope. Salmond J, in the New Zealand case of Welsh v "[T]he testamentary duty of a man towards his family is not limited to a merely eleemosynary provision sufficient to provide the necessities of existence. This may be the measure of the legal obligation of a husband or a father in his lifetime under the Destitute Persons Act, but it is not the measure of that moral obligation – that officium pietatis, as the Roman lawyers called it – which he owes to his family in respect of the testamentary disposition of his estate, and which is recognized and enforced by the Family Protection Act." The "testamentary duty" which justified legislative interference with a free exercise of testamentary capacity, that is, the duty of a man to make provision for his wife and children, was seen as a moral duty. The legislation was not merely, or even primarily, concerned with relieving the state of the financial burden of supporting indigent widows and children. The courts were not empowered merely to make such provision for an applicant as would rescue the applicant from destitution. The legislative power was to make "proper" provision. Judicial explanation of what was meant by proper provision was based upon the idea of a moral obligation arising from a familial relationship. That is one of the fundamental ideas upon which the structure of our society is based. Similarly, when courts came to address the discretionary question of making fit provision, they had to consider the interests of those upon whom the burden of an order might fall. In making decisions, courts have had regard to competing claims upon a testator (or, later, a person who died intestate). It would now be regarded as self-evident that a court would be readier to disturb a testamentary provision in favour of a beneficiary, such as a charity, with whom a testator had no connection than a provision in favour of dependent relatives9. Why is this so? The answer, again, lies in concepts of moral obligation. This Court has also relied upon a dominant legislative purpose of enforcing moral duties as a reason for refusing to give effect to an attempt to contract out of making an application10. [1924] NZLR 673 at 685. 9 See, for example, Coates v National Trustees Executors and Agency Co Ltd (1956) 95 CLR 494 at 510 per Dixon CJ. 10 Lieberman v Morris (1944) 69 CLR 69. Perhaps the most frequently cited statement of basic principle underlying this legislation is that of Salmond J in In re Allen (deceased), Allen v Manchester11: "The provision which the Court may properly make in default of testamentary provision is that which a just and wise father would have thought it his moral duty to make in the interests of his widow and children had he been fully aware of all the relevant circumstances." That statement was adopted by the Privy Council in a New South Wales appeal in Bosch v Perpetual Trustee Co12. Bosch, in turn, has been followed and applied in this Court many times. In McCosker v McCosker13, Dixon CJ and Williams J, referring to what is sometimes called the primary or jurisdictional question, said: "The question is whether, in all the circumstances of the case, it can be said that the respondent has been left by the testator without adequate provision for his proper maintenance, education and advancement in life. As the Privy Council said in Bosch v Perpetual Trustee Co (Ltd) the word 'proper' in this collocation of words is of considerable importance. It means 'proper' in all the circumstances of the case, so that the question whether a widow or child of a testator has been left without adequate provision for his or her proper maintenance, education or advancement in life must be considered in the light of all the competing claims upon the bounty of the testator and their relative urgency, the standard of living his family enjoyed in his lifetime, in the case of a child his or her need of education or of assistance in some chosen occupation and the testator's ability to meet such claims having regard to the size of his fortune. If the court considers that there has been a breach by a testator of his duty as a wise and just husband or father to make adequate provision for the proper maintenance education or advancement in life of the applicant, having regard to all these circumstances, the court has jurisdiction to remedy the breach and for that purpose to modify the testator's testamentary dispositions to the necessary extent." (Footnote omitted) In 1994, in Singer v Berghouse14, Mason CJ, Deane and McHugh JJ said that in Australia it has been accepted that the correct approach to the exercise of 11 [1922] NZLR 218 at 220-221. 12 [1938] AC 463 at 479. 13 (1957) 97 CLR 566 at 571-572. 14 (1994) 181 CLR 201 at 209. jurisdiction under testator's family maintenance legislation is that stated by Salmond J in In re Allen. Of all the cases that have come to this Court under the testator's family maintenance legislation of the various States, I have been able to find only three in which there is no reference in any of the judgments to concepts of moral claims or moral obligations15. There may be others but, in any event, they are rare. Sometimes, reference has been made to "natural claims". In Coates v National Trustees Executors and Agency Co Ltd16, Dixon CJ, having referred to the decision of the Privy Council in Bosch, spoke of an adult son's "natural claims upon [his mother's] testamentary bounty" which "were much strengthened by his co-operation and support in the conduct of her business and of her affairs." The context makes it plain that what Dixon CJ described as "natural claims" were the same as what Salmond J had in mind in referring to a testator's "moral duty". The same approach has been taken by the Supreme Court of Canada to corresponding legislation. In 1994, in Tataryn v Tataryn17, McLachlin J, responding to an argument that the "moral duty" approach was inappropriate because of its uncertainty, said: "If the phrase 'adequate, just and equitable' is viewed in light of current societal norms, much of the uncertainty disappears. Furthermore, two sorts of norms are available and both must be addressed. The first are the obligations which the law would impose on a person during his or her life were the question of provision for the claimant to arise. These might be described as legal obligations. The second type of norms are found in society's reasonable expectations of what a judicious person would do in the circumstances, by reference to contemporary community standards. These might be called moral obligations, following the language traditionally used by the courts." In her explanation of the concept of moral duties, as found in contemporary community standards concerning the behaviour of a judicious testator in the circumstances, McLachlin J spoke in terms that would be familiar to any student of Australian decisions on testator's family maintenance legislation. 15 Fox v Burvill (1955) 92 CLR 334; Cope v Keene (1968) 118 CLR 1; Easterbrook v Young (1977) 136 CLR 308. 16 (1956) 95 CLR 494 at 509-510. 17 [1994] 2 SCR 807 at 820-821. In Singer v Berghouse18, Mason CJ, Deane and McHugh JJ doubted that the statement of Salmond J provided useful assistance in elucidating the statutory provisions. I do not share that doubt. I add, however, that it is one thing to seek assistance in elucidating statutory provisions, and another to substitute judicial exposition of statutory purpose for the legislative text. Their Honours went on to describe references to "moral obligations" as a gloss on the statutory text. If, by that, they meant that such references are not to be used as a substitute for the text, I agree. If they meant that such references are never of use as part of an exposition of legislative purpose, then I regret that I am unable to agree19. The descriptions of references to moral duty or moral obligations as a gloss upon the text was not new. In 1956, in Coates v National Trustees Executors and Agency Co Ltd20, Fullagar J said: "The notion of 'moral duty' is found not in the statute but in a gloss upon the statute. It may be a helpful gloss in many cases, but, when a critical question of meaning arises, the question must be answered by reference to the text and not by reference to the gloss." In the next paragraph of their judgment in Singer v Berghouse, Mason CJ, Deane and McHugh JJ went on to say that the concepts of "adequate" and "proper" in the statutory text were explained in Bosch. Then, in a passage bearing much similarity to what was said by Dixon CJ and Williams J in "The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty." (emphasis added) That formulation repeats the statutory term "proper", and directs attention to what is "appropriate" having regard to a number of specified circumstances which are said not to be exclusive. It concludes by referring to other persons who have "legitimate claims" upon the deceased's bounty. This assumes that the applicant is a person who has a legitimate claim upon the deceased's bounty, and directs 18 (1994) 181 CLR 201 at 209. 19 A detailed examination of this aspect of Singer v Berghouse appears in the judgment of Ormiston J in Collicoat v McMillan [1999] 3 VR 803 at 815-821. 20 (1956) 95 CLR 494 at 523. 21 (1994) 181 CLR 201 at 209-210. attention to the possibility that there may be others as well. It is far from clear that the concept of legitimate claims upon the bounty of a deceased is materially different from what other judges have described as moral claims, or natural claims. If their Honours thought there was a difference, they did not explain it. Their preference for the terminology of legitimate claims rather than that of moral claims (or, perhaps, natural claims) might be explained by the footnote references in the preceding paragraph, where "moral duty" and "moral obligation" were described as concepts that might well be understood as amounting to a gloss on the statute. Both references are to judgments of Murphy J. In the first, Murphy J took objection to the notion "that the appellant must establish his moral claim; in effect, his character and conduct must qualify him for the benefit of provision out of the estate."22 In the second, Murphy J said that unless an applicant is left without adequate provision for proper maintenance, education, or advancement, he or she is not entitled to an order, even if the circumstances disclose a breach of moral obligation.23 Those statements involve rejection of propositions which, if they ever had any currency in this area of the law, would have involved an argumentative attempt to deploy the idea of moral duty or obligation in a manner inconsistent with the structure and language of the statute. In 1979, in Hughes v National Trustees, Executors and Agency Co of Australasia Ltd24, Murphy J went so far as to describe references to moral claims as inconsistent with the legislative scheme. He was alone in that. The leading judgment in Hughes was written by Gibbs J, with whom Mason J and Aickin J agreed. Gibbs J referred to "the classical statement in Bosch v Perpetual Trustee Co" and quoted with approval the statement of Salmond J in In re Allen25. In Goodman v Windeyer26, which was decided in the following year, once again the leading judgment was written by Gibbs J, with whom Stephen J and Mason J agreed. Gibbs J said that "[t]he principles upon which the court must approach an application under legislation of this kind were settled in Bosch v Perpetual Trustee Co"27. His judgment contained references to moral claims and moral duties. 22 Hughes v National Trustees, Executors and Agency Co of Australasia Ltd (1979) 143 CLR 134 at 159. 23 Goodman v Windeyer (1980) 144 CLR 490 at 504-505. 24 (1979) 143 CLR 134 at 158-159. 25 (1979) 143 CLR 134 at 146-147. 26 (1980) 144 CLR 490. 27 (1980) 144 CLR 490 at 496. No doubt, from time to time, counsel will seek to press familiar concepts beyond their proper limits, and courts will find it necessary to warn against that. No doubt, also, as in the case of many statutes with a long history of judicial exposition, there may be a danger of losing sight of the text for the commentary. This danger is as old as law itself. It is not an argument against commentary. Reference has been made earlier to various elements of the legislative scheme to which, in the past, judges have related ideas of moral claims and moral duty: the matter of "proper" provision; the making, by court order, of "fit" provision; the determination as to where the burden of an order should fall; and the question of character or conduct disentitling an applicant to provision. The same ideas have also been significant as a restraint upon unwarranted judicial intervention. An example may be seen in the judgment of Kitto J in McCosker v "This is the kind of case in which it would be much more pleasant to be open-handed with the testator's estate than to confine oneself to the jurisdiction under the Act. But even if I felt sure that I understood the whole situation so well that I could deal with the estate more justly than the testator dealt with it, I should still not feel justified in asserting that when he decided to give the respondent no more than he had already given him, and to leave his estate to members of the family who had been closer to him and to whom he had his own reasons for being generous, he failed to recognise a moral duty which lay upon him." In explaining the purpose of testator's family maintenance legislation, and making the value judgments required by the legislation, courts have found considerations of moral claims and moral duty to be valuable currency. It remains of value, and should not be discarded. Such considerations have a proper place in the exposition of the legislative purpose, and in the understanding and application of the statutory text. They are useful as a guide to the meaning of the statute. They are not meant to be a substitute for the text. They connect the general but value-laden language of the statute to the community standards which give it practical meaning. In some respects, those standards change and develop over time. There is no reason to deny to them the description "moral". As McLachlin J pointed out in the Supreme Court of Canada, that is the way in which courts have traditionally described them. Attempts to misapply judicial authority, whatever form they take, can be identified and resisted. There is no occasion to reject the insights contained in such authority. 28 (1957) 97 CLR 566 at 580. This case The decisions of this Court in Coates and Hughes dealt with a situation that has caused some difficulties in the operation of testator's family maintenance legislation. It is a situation that arises also in the present case: an application by an able-bodied adult son. In Hughes, Gibbs J29, with whom Mason J and Aickin J agreed, approved what had been said by Fullagar J in the Supreme Court of Victoria in In re Sinnott30: "No special principle is to be applied in the case of an adult son. But the approach of the Court must be different. In the case of a widow or an infant child, the Court is dealing with one who is prima facie dependent on the testator and prima facie has a claim to be maintained and supported. But an adult son is, I think, prima facie able to 'maintain and support' himself, and some special need or some special claim must, generally speaking, be shown to justify intervention by the Court under the Act." Fullagar J prefaced that by references to Bosch and the statement by Salmond J in In re Allen, and later said31: "The discretion given by the Act is obviously intended to be very wide. The size of the estate is always important, and there will commonly be needs and claims other than those of the applicant to be considered. But it is always, I think, primarily a matter of estimating need and moral claim. Often need and moral claim will co-exist. ... In the case of an adult son, who has received an education and is well able to earn his living, the father's moral obligation can probably in most cases be regarded as discharged, and a wise and just testator may well feel himself at liberty (to use the words of Sir John Salmond) 'to do what he likes with his own'." It is obvious that, in the passage cited in Hughes, Fullagar J was referring to a special need or a special moral claim. If, for "moral", one were to substitute "natural", or "legitimate", the meaning would not be different. The appellant is the eldest of five children of Lino Vigolo (the testator) and Rosario Vigolo. The testator died in June 1997, leaving an estate worth $1.9 million. By his will, he made no provision for the appellant or for Rosario 29 (1979) 143 CLR 134 at 147. 30 [1948] VLR 279 at 280. 31 In re Sinnott [1948] VLR 279 at 281. Vigolo. His estate was divided equally between his other four children. At the time of the testator's death, the appellant was aged 40. McLure J determined that, as at 30 June 2000, the appellant and his wife (who were beneficiaries in a family trust) owned assets worth in excess of $2 million. His claim was not based on financial need, and it is unnecessary to go into the details. At the time of the hearing before McLure J, the four beneficiaries under the testator's will had net assets of approximately $202,000, $271,000, $216,000 (in those three cases, jointly with their spouses), and $70,000 respectively. Clearly, the appellant was in a much stronger position financially than his siblings, for whom the testator made provision. The circumstances in which the testator made his will, leaving nothing to his widow and eldest son, were as follows. The facts are not in dispute and the following summary is largely taken from the submissions for the appellant. In the early 1960s, the testator and his wife commenced farming on a conditional purchase property at Narrikup near Albany. In May and June 1972, they bought two adjoining properties. In 1981, the conditional purchase property was converted to freehold and registered in the name of the testator. All those properties together became known as the "Old Coach Road Farm". The appellant left school in 1973 aged 16, and worked on the Old Coach Road Farm with his father and mother. In 1976, he also took another part-time job. By 1978, when he was 21, he had saved some money, and told the testator he wanted to buy his own farm. The testator persuaded him to buy, jointly with his parents, a farm known as the Albany Highway Farm. The three of them became partners in a business conducted on the Old Coach Road Farm and the Albany Highway Farm. The testator promised the appellant that, when the testator died, the Old Coach Road Farm would be inherited by the appellant. It was not contended that the promise gave rise to any enforceable legal or equitable rights. As will appear, the testator evidently considered that it was overtaken by later events. Furthermore, as McLure J pointed out, if any attempt had been made to base a legal or equitable entitlement on the promise, it would have been necessary to explore the assumptions on which the promise was made, such as that the business relationship would continue. Over the next 15 years, the partnership continued. The promise was repeated several times. In 1988, the assets and liabilities of the partnership were transferred to a company in which the three former partners were equal shareholders. In 1980, the appellant bought a house on Albany Highway with funds borrowed from a bank, and a contribution from his wife. In the early 1990s he bought a shop in a nearby town, from which his wife conducted a business. In 1991, the appellant and his wife bought another farming property. This accumulation of personal assets by the appellant was resented by the testator. It led to a family dispute, and a break-up of the business relationship. The terms upon which the appellant and his parents divided their assets were contained in a Deed of Settlement of December 1993. The appellant withdrew from the company, and the company's property and other jointly owned assets were distributed between the appellant and his father and mother on an agreed basis. The appellant's mother made a gift to the appellant of the value of her interest in the Old Coach Road Farm, but, as part of the settlement, the appellant was required to purchase the testator's interest in the farm at market value. In the Full Court, Sheppard AUJ said: "In 1993, father and son fell out. They fell out, not because of any wish of the son, but because the father resented the son and his wife building up assets that were not partnership or company assets. The father regarded [the appellant's] obligations as being owed entirely to the family. He was the eldest son; he would inherit the principal assets and he would, in due course, succeed his father as head of a traditional Italian family. But the father's decision to bring things to an end changed all that. [The appellant] agreed to the dissolution, maybe unwillingly, but nevertheless, he agreed and the transactions which gave effect to it were all conducted at arm's length. [The appellant] came out of all this comparatively well off. The bitter pill for him was that he had to pay a commercial price for the Old Coach Road farm when he believed all along that he was entitled to inherit it." McLure J, at first instance, examined in detail the financial dealings between the appellant and his parents, and the terms of the dissolution of their business associations. She found specifically that the appellant was adequately and proportionately compensated for his contributions to the farming business. She also found that, compared with his siblings, the opportunities he was given by his parents were to his significant financial advantage. She held, and the Full Court agreed, that the appellant had failed to show that he was left without adequate provision for the matters referred to in the Act or that proper provision required that he ought to have been made a beneficiary in the testator's will. No successful challenge to that conclusion can be made. When regard is had to the size of the testator's estate, the age and financial circumstances of the appellant, and the comparative situation of the appellant's siblings, and their claims on the testator's bounty, it is impossible to conclude that the testator left the appellant without adequate provision for his proper maintenance and advancement. The finding that the appellant was adequately compensated for his contribution to the family farming business and, indeed, advantaged by comparison with his siblings is significant. The testator's promise relating to the Old Coach Road Farm must be considered in the light of later events. The appellant and his parents agreed, at arm's length, to dissolve their financial relationship. They did so on proper commercial terms. Whatever justification, in personal terms, might have existed for a grievance on the part of the appellant, it did not, in the circumstances referred to at the commencement of this paragraph, amount to a claim (moral, natural or legitimate) that demanded testamentary recognition by a judicious father. The appeal should be dismissed. I agree with the costs orders proposed by GUMMOW AND HAYNE JJ. This is an appeal from the Full Court of the Supreme Court of Western Australia (Steytler and Parker JJ, Sheppard AUJ)32 which dismissed an appeal against the rejection by a judge of that Court (McLure J)33 of an application for an order under s 6 of the Inheritance (Family and Dependants Provision) Act 1972 (WA) ("the Act"). The parties The appellant in this Court, and the unsuccessful party at first instance and in the Full Court, is Mr Virginio Vigolo, the elder son of the late Mr Lino Vigolo. Mr Lino Vigolo died on 3 June 1997 aged 69, leaving his widow and the five adult children of their marriage. Mr Lino Vigolo left an estate, the net worth of which at the date of his death was $1,913,144. By his last will dated 30 November 1994, he appointed his daughter Wanda and younger son, Leopoldo, executors and trustees and divided his estate between those two children, together with his daughters Nancy and Sandra, as tenants in common in equal shares. No question arises concerning the construction of the will. The testator made no provision for the appellant or for his widow, Mrs Rosario Vigolo. She was notified of the proceedings in the Supreme Court but took no part in the litigation. The first respondents to the appeal are the executors of the will and, in addition, all four siblings were sued personally and are joined as second, third, fourth and fifth respondents to this appeal. The same counsel appeared for all respondents. There is no suggestion that the first respondents have not adequately represented the interests of all the beneficiaries34. Given the nature of the issues on the appeal which concern only the "jurisdiction" issue, it would have been appropriate if counsel had appeared only for the trustees and if the other respondents had submitted save as to costs. But no objection at the hearing of the appeal was taken to the course in fact pursued. The family history In the early 1960s, Mr and Mrs Vigolo commenced farming on a conditional purchase lease property near Albany. Thereafter, other properties were acquired and together were known as the "Old Coach Road farm". In 1978, 32 Vigolo v Bostin (2002) 27 WAR 121. 33 Vigolo v Bostin [2001] WASC 335. 34 cf Nevill and Ashe, Equity Proceedings With Precedents (New South Wales), Mr and Mrs Vigolo acquired other land which was identified in the evidence as the "Albany Highway farm". The appellant was born in 1957. He left school in 1973 aged 16 and commenced working full-time on the Old Coach Road farm with his parents. He married in 1984 and the only child of the marriage was born in 1988. In 1993, as a result of the breakdown in the relationship between the appellant and his father, the former's involvement with his parents in the family farming business came to an end. The parties entered into a Deed of Settlement dated 9 December 1993 ("the Deed of Settlement"). Among other things, this provided for the transfer of the Old Coach Road farm to the appellant and his wife as trustees of their family trust. The testator's share in the Old Coach Road farm was sold for $571,760. The share of Mrs Rosario Vigolo was valued at $228,240 and she made a gift thereof to the appellant and his wife. In respect of the Old Coach Road farm and other assets sold to them pursuant to the Deed of Settlement the total consideration was $1,012,454; allowing for the gift of $228,240 and for certain sums to be set-off, the cash balance payable by them on settlement was $251,737. This, with another sum for working capital, was borrowed by the appellant and his wife from a bank. In June 1998, after his father's death, the appellant and his wife sold the Old Coach Road farm for $1.68 million. It should be noted that the father made his last will some months after the Deed of Settlement. The appellant's case The leading judgment in the Full Court was given by Sheppard AUJ. His Honour recorded, as had McLure J, that financial need was not put as a basis for the appellant's case; rather, the essence of the case was said to be a "moral claim" based on his family dealings, in particular a "promise" made by the deceased to leave to the appellant the Old Coach Road farm in return for his dedication and hard work in building up family assets. In his leading affidavit, the appellant stated the essence of the case put in support of his application under the Act as follows: "I believe that by reason of the promises made to me by my father which encouraged and persuaded me to live and work on the family farm and the other farming properties for very meagre 'wages', my contribution of my own savings to the purchase of the Albany Highway farm, my commitment to my father all my life until we dissolved our partnership in 1994, that I had to buy what my father had always told me would be my inheritance and the significant personal contribution I made over my lifetime towards 1994 to building up my father's estate, that I have a substantial claim to share in my father's estate at least equally with each of my brother and my sisters such that inadequate provision has been made for me in my father's will." The decisions at trial and on appeal The primary judge found that on a number of occasions the deceased had said to the appellant words to the effect that he would inherit the Old Coach Road farm. On one occasion when the appellant raised with his father the low wages paid to him, he was told that he was paid only a small amount because the appellant would inherit the Old Coach Road farm when his father died. Sheppard AUJ described the course of the appellant's relationship with his father and the family business as follows35: "Undoubtedly, the evidence establishes that [the appellant] made a very substantial contribution to the welfare of the family business and that of his father and mother. He made it over many years, commencing full- time work on the Old Coach Road farm when he was 16 years of age. Eventually, he became a partner in the family partnership and then a shareholder in the company which replaced the partnership in 1988. But, as the years went on, [the appellant], although he continued to do what he had done before, additionally began to acquire assets in which the company had no interest. This he did in conjunction with his wife. This was not something that pleased the deceased. So to speak, he wanted everything in the family. He complained to [the appellant] about his going his separate way. But [the appellant] was not receptive to his entreaties. Eventually, it was decided to end the business relationship which had existed between father and son for some 15 years and, really, when one takes into account the past, for much longer. There was a break-up of the assets effected by the deed of settlement which resulted in [the appellant] and his wife taking over the Old Coach Road farm and the deceased retaining the Albany Highway farm. The other assets of the company were divided or distributed in various ways … The various transactions are perhaps complicated by the existence of trusts. But the essence of what happened is as stated above." His Honour continued36: "The upshot of this was that a balance of over $500,000 became payable by [the appellant] in effect for the acquisition of the Old Coach 35 (2002) 27 WAR 121 at 143. 36 (2002) 27 WAR 121 at 143. Road farm. Although the amount he had to pay was substantially reduced by [his mother] making her gift to him of her entitlement under the distribution brought about by the deed of settlement, there was still a substantial balance to pay." Of the falling out between father and son leading, among other things, to the Deed of Settlement, Sheppard AUJ remarked37: "They fell out, not because of any wish of the son, but because the father resented the son and his wife building up assets that were not partnership or company assets. The father regarded [the appellant's] obligations as being owed entirely to the family. He was the eldest son; he would inherit the principal assets and he would, in due course, succeed his father as head of a traditional Italian family. But the father's decision to bring things to an end changed all that. [The appellant] agreed to the dissolution, maybe unwillingly, but nevertheless, he agreed and the transactions which gave effect to it were all conducted at arm's length. [The appellant] came out of all this comparatively well off. The bitter pill for him was that he had to pay a commercial price for the Old Coach Road farm when he believed all along that he was entitled to inherit it." It is not disputed that, as Williams J observed in Lieberman v Morris38 of the then New South Wales legislation39, "in the case of large estates, provision can be made for the well-to-do". In this Court, counsel affirmed that the application under the Act was not brought on the basis of financial need, but on the basis of a "moral claim" to adequate provision for the proper advancement in life of the appellant. The submissions for the appellant referred the narration by Sheppard AUJ of the course of the relationship between father and elder son and to the hurt sustained by the realisation that, contrary to the promise made, the appellant could only acquire the Old Coach Road farm by purchase. An understanding of this state of affairs was said to go to the core of what is required here of a wise and just testator to make proper provision in all the circumstances, namely to meet the promises made and satisfy the familial relationship between father and son and thereby provide for the advancement in life of the appellant. 37 (2002) 27 WAR 121 at 144. 38 (1944) 69 CLR 69 at 91-92. See also Re Leonard [1985] 2 NZLR 88 at 91. 39 Testator's Family Maintenance and Guardianship of Infants Act 1916 (NSW). Section 6(1) of the Act It is convenient now to turn to the central provision of the Act. In doing so, it should be observed that, in construing that legislation, a construction promoting the purpose or object of the legislation is to be preferred to a construction that would not promote that purpose or object. This is the approach to construction mandated by the Interpretation Act 1984 (WA), s 18. Section 6(1) of the Act states: "If any person (in this Act called 'the deceased') dies, then, if the Court is of the opinion that the disposition of the deceased's estate effected by his will, or the law relating to intestacy, or the combination of his will and that law, is not such as to make adequate provision from his estate for the proper maintenance, support, education or advancement in life of any of the persons mentioned in section 7 of this Act as being persons by whom or on whose behalf application may be made under this Act, the Court may, at its discretion, on application made by or on behalf of any such person, order that such provision as the Court thinks fit is made out of the estate of the deceased for that purpose." (emphasis added) The persons mentioned in s 7 are a range of individuals extending beyond any surviving spouse and child of the deceased, and including parents and in some circumstances grandchildren of the deceased40. Several further points should be made concerning the construction of s 6(1). First, the sub-section is an example of a law which authorises the making of curial orders altering interests in property otherwise arising by operation of a law concerning testamentary succession and intestate succession. The legislation does not give effect to antecedent rights arising by virtue of familial relationships; rather, rights are created and enforced "in one blow"41. Secondly, in Singer v Berghouse42, Mason CJ, Deane and McHugh JJ, speaking of the current New South Wales legislation43, made observations 40 The classes of persons specified in s 7 have been expanded by Pt 13 of the Acts Amendment (Lesbian and Gay Reform) Act 2002 (WA), but this litigation turns upon the legislation in its previous form. 41 Fisher v Fisher (1986) 161 CLR 438 at 453. See also James Hardie & Coy Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53 at 64-65 [22]-[24]. 42 (1994) 181 CLR 201. 43 Family Provision Act 1982 (NSW). applicable to the structure of s 6(1) of the Western Australian statute. Their "It is clear that, under these provisions, the court is required to carry out a two-stage process. The first stage calls for a determination of whether the applicant has been left without adequate provision for his or her proper maintenance, education and advancement in life. The second stage, which only arises if that determination be made in favour of the applicant, requires the court to decide what provision ought to be made out of the deceased's estate for the applicant. The first stage has been described as the 'jurisdictional question'45." Their Honours went on to indicate that that description of the "jurisdictional question" meant no more than that the court's power to make an order in favour of an applicant was conditioned upon the court first being satisfied of the state of affairs predicated in what in Western Australia is the opening passage of s 6(1), ending with the words "made under this Act". In the present case, McLure J, having answered in the negative the "jurisdictional question", correctly said that it was unnecessary to go to the second stage of the process. Thirdly, many of the decisions expounding upon the moral duties of testators and to which reference was made in submissions, beginning with Allardice v Allardice46 and including Bosch v Perpetual Trustee Co Ltd47, were decided upon legislation which did not then make provision with respect to intestate as well as testate succession. The utilisation of concepts of "moral duty" and "moral claim" appears to have originated in a series of judgments by Edwards J upon the first statute in the field, The Testator's Family Maintenance Act 1900 (NZ)48. Thereafter, in his judgment in the New Zealand Court of 44 (1994) 181 CLR 201 at 208-209. 45 See, eg, White v Barron (1980) 144 CLR 431 at 456; Bondelmonte v Blanckensee [1989] WAR 305 at 307; Golosky v Golosky, unreported, New South Wales Court of Appeal, 5 October 1993. 46 (1910) 29 NZLR 959; affd [1911] AC 730, and decided upon The Family Protection Act 1908 (NZ). The provenance of the New Zealand legislation is traced in Grainer, "Is Family Protection a Question of Moral Duty?", (1994) 24 Victoria University of Wellington Law Review 141 at 142-144. 47 [1938] AC 463, decided upon the New South Wales Act of 1916. 48 Laird v Laird (1903) 5 Gazette Law Reports 466 at 467 ("natural duty"); Plimmer v Plimmer (1906) 9 Gazette Law Reports 10 at 24 ("moral duty"). In Rowe v Lewis (1907) 26 NZLR 769 at 772, a case upon The Testator's Family Maintenance Act (Footnote continues on next page) Appeal in Allardice, Edwards J, speaking with reference to The Family Protection Act 1908 (NZ), said49: "It is the duty of the Court, so far as is possible, to place itself in all respects in the position of the testator, and to consider whether or not, having regard to all existing facts and surrounding circumstances, the testator has been guilty of a manifest breach of that moral duty which a just, but not a loving, husband or father owes towards his wife or towards his children, as the case may be. … [T]he Court should never lose sight of the fact that at best it can but very imperfectly place itself in the position of the testator, or appreciate the motives which have swayed him in the disposition of his property, or the justification which he may really have for what appears to be an unjust will." Later, in In re Allen (Deceased), Allen v Manchester50, a decision of Salmond J upon the same New Zealand legislation, there was a reformulation expressed as follows51: "The provision which the Court may properly make in default of testamentary provision is that which a just and wise father would have thought it his moral duty to make in the interests of his widow and children had he been fully aware of all the relevant circumstances. If it is manifest that the testator has, whether consciously or inadvertently, failed to perform this duty, it is the right and duty of the Court to perform it for him by making such alterations in his testamentary dispositions as may be adequate, but no more than adequate, for that purpose". Fourthly, the apparent enshrining of "moral duty" as an aid to interpretation of Australian family provision statutes by the Privy Council in Bosch52, with approval by their Lordships of Allardice and Allen, was made on an appeal taken directly from Nicholas J sitting in the equity jurisdiction of the Supreme Court of New South Wales. The litigation bypassed this Court. Given the ultimate authority of the Privy Council in matters of State law, for many 1906 (NZ), Chapman J referred to "the duty, morally speaking" of the testator in that case. 49 (1910) 29 NZLR 959 at 972-973. 50 [1922] NZLR 218. 51 [1922] NZLR 218 at 220-221. 52 [1938] AC 463 at 478-479. years Bosch foreclosed too critical a reassessment in this Court of the importance of a "moral duty" for the construction of the Australian legislation. Nevertheless, some caution in acceptance of the formulation adopted in Bosch is later apparent, for example, in the judgment of Dixon CJ in Pontifical Society for the Propagation of the Faith v Scales53. In Stott v Cook54, Windeyer J observed: "Questions of duty, when not determinable by the fixed criteria of law, become questions of casuistry. Standards and principles may be stated. But their application to a particular case can seldom be beyond all debate even when all the facts are known." More explicitly, in Coates v National Trustees Executors and Agency Co Ltd, "If the result of the cases is that the expression 'breach of moral duty' has now to be regarded as a literal statement of the condition on which jurisdiction depends, then it is indeed to be regretted that any such term as 'moral duty' was ever used in connexion with testator's family maintenance. It is perhaps in any case to be regretted. No such term is used in any of the relevant statutes, and it is surely wrong to say that every order in favour of an applicant under any of the statutes has involved a moral reflection on the testator." His Honour added, in a passage which will supply a key for the present appeal56: "I do not think there is any rule of law that we must weigh every testator in the scales against a standard of testamentary impeccability. I do not think, generally speaking, that the courts, when they have referred to 'moral duty', have really intended to do more than suggest that the court ought to do what it is to be supposed that the testator would have done if he had known and properly appreciated all the circumstances of the case." 53 (1962) 107 CLR 9 at 20. 54 (1960) 33 ALJR 447 at 455. 55 (1956) 95 CLR 494 at 522. Williams J spoke to similar effect at 512. 56 (1956) 95 CLR 494 at 523. Finally, with the amendment of the legislation in various jurisdictions57 to include cases of whole or partial intestacy, there arose a need to reconsider the references to the "moral duty" of testators. In Re Russell58, Lucas J said of the Queensland statute: "The shares in the estate which accrue to the various persons entitled to share in the distribution accrue to them, generally speaking, by operation of law and not as the result of any conscious or deliberate act on the part of the deceased, although it is of course possible that a man might make a deliberate decision not to make a will. It seems to me that the most practical way to look at the matter is to imagine that the deceased had made a will whereby he directed that his estate should be distributed as on intestacy, and then to consider the needs and moral claims of the persons who benefit from a distribution in this manner." Thereafter, Jacobs J, dealing in In the Estate of Brooks59 with the legislation in South Australia, was concerned with a case where not only had the deceased made no testamentary provisions but there was no living person other than his former wife with any claim upon his bounty. Jacobs J observed60: "I would be surprised to think that the Crown could assert any relevant need or moral claim." In Western Australia, provision respecting intestacy was first made with the enactment of the present legislation in 1972. In the second reading speech on the Inheritance (Family and Dependants Provision) Bill, the Attorney-General said it was "logical" to extend the right of application and to give "the same redress … to deserving claimants in an intestacy"61. To accommodate the changes now reflected in s 6(1), s 6(2) was included. This states: 57 For example, in New Zealand by s 22 of the Statutes Amendment Act 1939 (NZ); in New South Wales by s 9 of the Conveyancing, Trustee and Probate (Amendment) Act 1938 (NSW); in Tasmania by s 3 of the Testator's Family Maintenance Act 1957 (Tas); in Victoria by the Administration and Probate (Family Provision) Act 1962 (Vic); in Queensland by s 12 of the Succession Acts Amendment Act 1968 (Q); and in South Australia by the Inheritance (Family Provision) Act 1972 (SA). 58 [1970] QWN 22 at 56. 59 (1979) 22 SASR 398. 60 (1979) 22 SASR 398 at 400. 61 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 23 March 1972 at 273. "The Court in considering for the purposes of subsection (1) of this section whether the disposition of the deceased's estate effected by the law relating to intestacy, or by the combination of the deceased's will and that law, makes adequate provision for the purposes of this Act shall not be bound to assume that the law relating to intestacy makes adequate provision in all cases." The significant changes made in the various jurisdictions, including Western Australia, to the family provision legislation in the course of the century of its existence indicate the need for caution in a continued reiteration, as an aid to construction of modern legislation, of the moral duty owed by testators to their spouses and children. "Moral duty" and "moral claim" In the early New Zealand case, In re Rush, Rush v Rush62, Edwards J spoke of the legislature having "intrusted to the Court the duty of seeing that a testator does not sin in his grave" by leaving unprovided for "those whom nature has made dependent upon him"; the Court discharged this duty by providing in the first place for those, such as his wife, "to whom the law [including The Destitute Persons Act 1894 (NZ)] gave rights against him, in his lifetime". Then, in Laird63, Edwards J returned to the notion of "natural claims" as supporting in a given case an order for a provision greater than that which the law of intestate succession would have conferred upon a claimant had the testator died intestate. The next stage in New Zealand was the formulation of "moral duty" in the passages in Allardice64 and Allen65 which have been set out earlier in these reasons. By the steps traced in Rush, Laird, Allardice and Allen, the New Zealand judges were expanding upon what had threatened to become a narrow reading of the general words of the legislation. The emergence of a criterion of "moral duty" thus was not calculated to contract the operation of the legislation, or to obstruct what otherwise might be good claims to an order. Yet, paradoxically, that may have been the tendency of the later case law. 62 (1901) 20 NZLR 249 at 253. 63 (1903) 5 Gazette Law Reports 466 at 467. 64 (1910) 29 NZLR 959 at 972-973. 65 [1922] NZLR 218 at 220-221. As the case law developed after Allardice and Allen, references to the "moral duty" of testators have been accompanied by a correlative "moral claim" upon the bounty of testators and to the absence of such a claim as informing an evaluation of the respective positions of the applicant and the various testamentary beneficiaries. For example, in Hughes v National Trustees, Executors and Agency Co of Australasia Ltd, Gibbs J observed66: "The appellant is in very poor financial circumstances. His deserts may be small, but his needs are considerable. There were no competing claims on the bounty of the testatrix, who owed no moral duty to the Bethlehem Home for the Aged at Bendigo." In his judgments in Goodman v Windeyer67 and in Hughes68, Murphy J expressed dissatisfaction with this focus upon notions of "moral duty" and "moral claim". His Honour stressed that the entitlement to make a claim was to be found in the terms of the statute. The applicant was not to be put additionally to the proof of a "moral claim". Nor did the existence of a "moral claim" remedy the absence in a particular case of an ability to make a claim under the legislation69. In New Zealand itself, doubts were expressed as to whether the subsequent case law70 had taken the references in Allardice and Allen to "moral duty" beyond what could have been envisaged by the promoters of the original legislation71. 66 (1979) 143 CLR 134 at 148-149. 67 (1980) 144 CLR 490 at 504-505. 68 (1979) 143 CLR 134 at 158-159. 69 See the discussion of the judgments of Murphy J by Kirby P in Permanent Trustee Co Ltd v Fraser (1995) 36 NSWLR 24 at 28-29. 70 For example, in Re Leonard [1985] 2 NZLR 88 at 92, McMullin J identified the "essential questions" arising in every case under the Family Protection Act 1955 (NZ) as being "[w]as there a moral duty on the testator to provide for the claimants under his will? If so, did he fail to discharge it?". See also Lewis v Cotton [2001] 2 NZLR 21 at 34. 71 Grainer, "Is Family Protection a Question of Moral Duty?", (1994) 24 Victoria University of Wellington Law Review 141 at 145-148, 160-161. Thereafter, in their joint judgment in Singer, Mason CJ, Deane and McHugh JJ, after referring to the statement by Salmond J in Allen and to the comments of Murphy J in Goodman and Hughes, said72: "For our part, we doubt that this statement provides useful assistance in elucidating the statutory provisions. Indeed, references to 'moral duty' or 'moral obligation' may well be understood as amounting to a gloss on the statutory language". It is apparent that their Honours were not using the term "gloss" in its milder sense of an epexegetical comment or explanation. Rather, they were using it in the same sense as Williams J had done in Coates73, that is to say, of a paraphrase which is apt to mislead. This concern was similar to that expressed by Lord Wilberforce when dealing in Ebrahimi v Westbourne Galleries Ltd74 with the "just and equitable" ground of winding up under the companies legislation. Speaking of several restrictive interpretations which were to be rejected, his Lordship said75: "First, there has been a tendency to create categories or headings under which cases must be brought if the clause is to apply. This is wrong. Illustrations may be used, but general words should remain general and not be reduced to the sum of particular instances." In similar vein in Coates76, Fullagar J had warned against so treating the "moral duty test" as "to turn a guide into a tyrant, a commonly convenient factual test into a rule of law". "Moral duty" may often have been used as a convenient shorthand expression intended to do no more than invite attention to the questions presented by the relevant legislation77. Its use, however, has led to reference being made to the "moral claims" of those who seek further provision and that is an expression 72 (1994) 181 CLR 201 at 209. 73 (1956) 95 CLR 494 at 512. 75 [1973] AC 360 at 374-375. 76 (1956) 95 CLR 494 at 522-523. 77 Collicoat v McMillan [1999] 3 VR 803 at 818 per Ormiston J. which is liable to being misunderstood78 just as its progenitor "moral duty" may mislead. It is therefore better to forgo any convenience that these shorthand expressions may offer in favour of adherence to the relevant statutory language. In Permanent Trustee Co Ltd v Fraser79, Kirby P and Sheller JA correctly indicated that what was said in the joint judgment in Singer should henceforth provide an appropriate guide to the construction and operation of the family provision legislation. The correct approach The correct approach to construction of the first or "jurisdictional" limb of provisions such as s 6(1) of the Act is that indicated in the joint judgment in Singer. Their Honours referred80 to the statement of Gibbs J in Goodman81: "[T]he words 'adequate' and 'proper' are always relative. There are no fixed standards, and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards". Their Honours then added82: "It is clear from this passage that his Honour was conveying that the primary judge was in essence making a value judgment in much the same way as a primary judge makes a sound discretionary judgment in personal injury cases when he or she assesses the quantum of damages say for pain and suffering, and for loss of amenities of life." They earlier had observed83: "The evaluative character of the decision stems from the fact that the court must determine whether the applicant has been left without adequate 78 Collicoat v McMillan [1999] 3 VR 803 at 818-819 per Ormiston J. 79 (1995) 36 NSWLR 24 at 29, 46 respectively; cf at 36 per Handley JA and Collicoat v McMillan [1999] 3 VR 803 at 815-820 per Ormiston J. 80 (1994) 181 CLR 201 at 211. 81 (1980) 144 CLR 490 at 502. 82 (1994) 181 CLR 201 at 211. 83 (1994) 181 CLR 201 at 210. provision for his or her proper maintenance, education and advancement in life." (original emphasis) With these passages is to be read the preceding statement of their Honours84: "The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty." For the present appeal, the references in the above passage to the totality of the relationship between the applicant and the deceased is of particular importance. Conclusions Both McLure J and Sheppard AUJ remarked that the present application under the Act was not of the same nature as a suit in equity relying upon principles of estoppel. Sheppard AUJ added85: "It is not a case for breach of contract, nor does it involve a claim based on actionable misrepresentation. It is a case under the Act and that is how it must be dealt with." McLure J had indicated that, if the application had been a suit in equity: "no doubt it would have been necessary to explore whether the statements were based on any known assumptions (such as that the partnership would continue or that the members of the partnership would work together to build a family asset base)". The appellant criticised these statements of the primary judge and in the Full Court as indicating an error of law in the application of the Act. They do not do so. 84 (1994) 181 CLR 201 at 209-210. 85 (2002) 27 WAR 121 at 144. The points made by their Honours helped to emphasise, by way of contrast, the attention required by the statute to the whole of the circumstances. These included not only the efforts of the appellant in building up the family assets over many years, but also the effect of the breakdown of the substratum of the family relationships upon which had depended the continuation of the representations made to the appellant by his father. Those relationships and the continued currency of the assurances given to the appellant were changed fundamentally by entry into the Deed of Settlement and the steps taken thereunder during the remainder of Mr Vigolo's life. It also may well have been the case (as McLure J implied in the above passage) that any rights the appellant had outside the Act, resting upon the assurances given to him respecting the Old Coach Road farm, could not have survived the consensual, if reluctant, rearrangement of family affairs effected by the Deed of Settlement. The appellant put forward as an apt factual analogy the statement by "In fact [the applicant] was allowed by his father, and later by the testatrix, to live on the farm and treat it as his own. He has since acted on the assumption that the farm would be his and was led to do so by the conduct of his parents, if not by their express promises. Wise and just parents, having allowed him to base his life on that foundation, would not years later attempt to deprive him of what had become necessary for the support of himself and his family." However, the difficulty for the present appellant is with the last sentence. Here, that foundation shifted radically with the Deed of Settlement and with it "the totality of the relationship" to which reference was made in Singer87. In oral submissions to this Court, counsel for the respondents properly emphasised the acceptance by Mason CJ, Deane and McHugh JJ in Singer88 of the proposition that, in an appeal from an adverse decision at the "jurisdictional" stage, the principles that govern appellate review of discretionary decisions apply. 86 (1979) 143 CLR 134 at 148. See also In the Will of Hughes [1930] St R Qd 329 at 87 (1994) 181 CLR 201 at 210. 88 (1994) 181 CLR 201 at 212. By that measure, it cannot be shown that McLure J erred and the Full Court correctly dismissed the appeal. Her Honour considered and rejected the appellant's case in terms of the "moral claim" advanced by him. But she did so in a detailed fashion which demonstrated full assessment of what was said in Singer to be required for the determination of the first or "jurisdictional" stage of the application89. No cause for appellate intervention arose. Orders The appeal should be dismissed. The appellant should pay the costs of the respondents as between party and party. Special provision should be made for the first and second respondents. Their costs of the appeal should be taxed on the trustee basis and to the extent that those costs exceed the costs borne and paid by the appellant as between party and party they should be paid out of the estate90. 89 (1994) 181 CLR 201 at 209-210. 90 cf Hogan v Hogan [1983] 2 NSWLR 561 at 562; Practice Note [1954] VLR 208. CALLINAN AND HEYDON JJ. Should the Court make an order in favour of a son of substantial means for provision out of his late father's estate pursuant to s 6(1) of the Inheritance (Family and Dependants Provision) Act 1972 (WA) ("the Act") in circumstances in which he has received money's worth for his efforts in the family business? Does the Act permit or contemplate that an order may be made in fulfilment of a moral obligation only? If it does, what kinds of circumstances will give rise to such an obligation? These are the questions which this appeal raises. Facts The appellant is the eldest of five adult children whose father died on 3 June 1997, leaving an estate worth about $1.9m. By his will he devised and bequeathed his real and personal property to the other four of his children in equal shares. Neither the appellant, nor his mother who has not made an application under the Act, was a beneficiary. The appellant was born on 20 October 1957. Within a few years of his birth, his parents began to farm land at Narrikup, near Albany. The land was leased from the Crown and covered 284 hectares. In October 1981, the appellant's father bought it. In 1972, the appellant's father and mother had bought two adjoining properties as tenants in common. The aggregation of the properties was called the "Old Coach Road farm". When he was 16 years old, the appellant left school to work full-time on the farm with his parents. He was paid $40 per month. In 1976, as the income from the farm declined, the appellant obtained work in Albany including as a slaughterman, a cleaner and a labourer. He continued to work part time on the farm however. He diligently saved his earnings. In 1978, when he was 21, and had accumulated $10 000, he told his father that he wished to buy his own farm. His father, in response, proposed that they buy a farm together "because at the end of the day when he died, it would all be mine". The appellant maintained that like assurances were given to him over the ensuing years. Furthermore, the appellant claimed, on one occasion his father told him that his wages were low because the farm would be his when he, his father, died. The appellant's evidence of his father's assurances is uncontradicted. It found a measure of confirmation in the respondents' evidence that although they had not heard their father give the assurances, they had heard their mother, who was also a partner in the business, say to the appellant that the farm would be his one day. In June 1978, the appellant and his parents purchased another farming business, the "Albany Highway farm" ("Albany"), as tenants in common. From September in that year, the farming business conducted on the Old Coach Road farm and Albany was carried on by a partnership of the appellant, his father and mother. Two of the appellant's sisters were partners at different times, although this was specifically for taxation reasons. Profits were allocated equally between the partners at the end of each financial year. At no time was the real property an asset of the partnership. In 1984, on the appellant's marriage, his wages were increased to $100 per week. His and his wife's costs of living were paid from other money derived from the farming business. In 1986, the testator, the appellant's mother, the appellant and his wife purchased another farm ("Chokerup"). The funds generated by all of the farms were used to buy some investment properties, including the Great Southern Produce Markets on the Albany Highway and a service station at King George Sound. In 1988, the assets and liabilities of the L Vigolo and Son partnership were transferred to L Vigolo & Son Pty Ltd ("the Company"). The business was then conducted by the Company in which the appellant, his father and mother were equal shareholders. On the birth of his first and only child, the appellant requested an increase in wages from his father. That request fell on deaf ears, but, as a compromise, the appellant was given a company chequebook to enable him to draw an allowance of $50 per week from the company's bank account for his wife. Following further complaints by the appellant in the early 1990s, his father increased this amount to $70 per week. At about this time, the appellant and his wife bought a hairdressing business at Mount Barker, which his wife conducted. Not long afterwards, they purchased a farm of 275 acres on Albany Highway at Narrikup. Sometime during 1993, there was a falling out between the appellant and his father. It seems that the father regarded the family business as an enterprise that should be conducted on a monolithic basis, and that all assets acquired individually should become part of it. He complained bitterly about the separate accumulation of assets by the appellant and his wife. The relationship between the appellant and his father deteriorated and the appellant's involvement with his parents in the family business came to an end. A Deed of Settlement dated 9 December 1993 was drawn up to record a division of the Company's assets between the testator and his wife, and the appellant and his wife. The assets were divided on an "arms-length" basis on a market valuation. Pursuant to the deed, the parents transferred the farm to the appellant and his wife. Its market value was $800,000. The father's share (valued at $571,760) was sold to and paid for by the appellant and his wife. The mother's share (valued at $228,240) was given to them. The farm was subsequently sold, in June 1998, by the appellant and his wife for $1,680,000. The testator made his will on 30 November 1994 after the settlement was completed. He omitted the appellant from it as a beneficiary because he believed that he had made more than adequate provision for him during his lifetime, and also because his wife had given the appellant and his wife her share in the Old Coach Road farm. The testator died on 3 June 1997. On 27 February 1999, the appellant made his application under s 6(1) of the Act for, among other things, an order that he receive a sum equal to one fifth of the net assets of his father's estate. The appellant's application was not based upon financial need. It was framed in this way: "I believe that by reason of the promises made to me by my father which encouraged and persuaded me to live and work on the family farm and the other farming properties for very meagre 'wages', my contribution of my own savings to the purchase of the Albany Highway farm, my commitment to my father all my life until we dissolved our partnership in 1994, that I had to buy what my father had always told me would be my inheritance and the significant personal contribution I made over my lifetime towards 1994 to building up my father's estate, that I have a substantial claim to share in my father's estate at least equally with each of my brother and my sisters such that adequate provision has not been made for me in my father's will." Decision of the trial judge In dismissing the application, the trial judge (McLure J) noted that the appellant did not seek to rely upon an estoppel or contract. It was unnecessary for her Honour therefore to make any findings about any assumptions, induced by the father's promises to the appellant. Her Honour concluded that the appellant had been adequately compensated for his contributions to the farming business, and that it was to his financial advantage that he be given the opportunity, of which he availed himself, to become a partner in his parents' business. The trial judge found that the appellant had received, in the period from 1979 to December 1993, more than one-third of the total of the profits, salary and other income received by the testator, the mother and the appellant in total. Accordingly, this was not, her Honour said, a case in which a child was seeking compensation for wages or capital forgone on the basis of an expectation of the receipt of an inheritance to be bequeathed to him in the future. Nor was her Honour satisfied that the appellant's efforts added any special value to his father's estate. Rather, the value of the contributions of the father, mother and the appellant were approximately equivalent, and this equivalence was reflected in the benefits each received from the farming business. Her Honour was of the view that the appellant did not therefore have a moral, or any other claim to justify provision for him out of his father's estate. The primary judge also compared the financial position of the appellant with that of each of the respondents. Her Honour found that their financial circumstances were modest, and that their capacity to acquire substantial assets in the future was limited. On the other hand, the appellant's position was "substantially superior". Although the father's estate may have been large enough to accommodate some claim by the appellant, without significant prejudice to the respondents, it was not the role of the Court to rewrite a testator's will beyond what is required by the Act. The primary judge held that the appellant was a person of significant means by reason in part at least of the opportunity given to him by his parents to participate in the farming business. Her Honour was not satisfied that the appellant had needs or requirements at the date of his father's death which he was unable to meet from his own resources. Nor was she prepared to hold that the testator failed to make adequate provision for the appellant's proper maintenance, education or advancement in life. The Full Court of the Supreme Court of Western Australia On his appeal to the Full Court, the appellant repeated the contention that he had a "moral claim" upon his father's estate. Sheppard AUJ, with whom Steytler and Parker JJ agreed, explained that claim in this way91: "It is plain on the face of the evidence that [the appellant] deeply resented the way events had developed. He, and her Honour appears to have accepted this, regarded the Old Coach Road farm as rightfully his in the sense that it would eventually come to him by way of inheritance when his father died. It is what he believed he had been promised in return for the dedicated years he had given his parents in the building up of the family fortune. The realisation that he could only acquire it by purchase came as a serious blow to him. He was deeply hurt by the turn of events. And his hurt was made the worse when he found that he was omitted from his father's will." Sheppard AUJ however, emphasized the need to construe the language of the Act and warned of the danger of focussing unduly on the concept of a "moral claim". His Honour was of the opinion that the correct approach was as stated by 91 Vigolo v Bostin (2002) 27 WAR 121 at 143 [98]. Mason CJ, Deane and McHugh JJ in Singer v Berghouse92: that the court must answer two questions. The first is whether the applicant has been left without adequate provision for his or her proper maintenance, education or advancement in life. If this question is answered affirmatively, only then will the court need to proceed to the second question, whether any provision, and if any, what provision, ought to be made out of the deceased's estate for the applicant. Sheppard AUJ was of the view that the appellant had failed to demonstrate that he had been left without adequate provision and accordingly found it unnecessary to decide whether any provision in his favour ought to be made. He held that the appeal should therefore be dismissed. In doing so, his Honour emphasized that it was not the Court's task to make a new will for a testator just because it may seem fair to do so. The mere fact that a will might be, or seem to be unjust, was, in his Honour's view, insufficient to give rise to an entitlement under the Act. The appeal to this Court The appellant's submissions The appellant submits that the Court of Appeal erred by determining that he had failed to demonstrate that he had been left without adequate provision for the "proper maintenance, support, education or advancement in life" by reason of the extent of his financial means. There was nothing in the language of s 6(3) of the Act to disqualify an applicant not in financial need from obtaining an order for provision by the Court. The appellant asserted that he has a "moral claim" to share in his father's estate for these reasons: absence of disentitling conduct; the filial relationship; the repeated promise that the testator would give the farm to the appellant; the appellant's expectation that the promise would be fulfilled; the appellant's contribution to the building up of his father's estate; and the value of it. In describing his claim as a "moral claim", we did not take the appellant to be doing more than asserting that it was proper for his advancement in life that some provision be made for him out of his father's estate93; he was only "suggest[ing] that the court ought to do what it is to be supposed that this testator would have done if he had known and properly appreciated all the circumstances 92 (1994) 181 CLR 201. 93 Coates v National Trustees Executors and Agency Co Ltd (1956) 95 CLR 494 at of the case"94. In this connexion the appellant emphasized the use of the word "proper" in s 6(1) of the Act. The appellant submitted that the primary judge erred in denying a remedy to the appellant simply because he was "an adult of significant means" and had no "needs or requirements ... for which he was unable to provide from his own resources". Her Honour should have had regard to all of the circumstances of the case, especially to the business, financial and filial relationship of the appellant to the testator. The appellant submitted that the Full Court fell into the same errors as the primary judge. Their Honours effectively treated the repeated promise and its non-fulfilment, and the surrounding circumstances as matters of no importance and irrelevant to the question whether the testator had made "adequate provision … for the [appellant's] proper maintenance ... or advancement in life". In summary, both the primary judge and the Full Court erred, not only in eschewing "moral duty" and "moral claim" as relevant and important considerations, but also in giving to the Act, far too narrow a construction contrary to the way in which courts have traditionally construed it and its analogues. The legislation Section 6(1) of the Act empowers a court to make provision out of a deceased's estate for any person who can demonstrate that he or she has not received adequate provision for his or her maintenance, support, education or advancement in life. Section 6(1) provides: Claims against estate of deceased person If any person (in this Act called 'the deceased') dies, then, if the Court is of the opinion that the disposition of the deceased's estate effected by his will, or the law relating to intestacy, or the combination of his will and that law, is not such as to make adequate provision from his estate for the proper maintenance, support, education or advancement in life of any of the persons mentioned in section 7 of this Act as being persons by whom or on whose behalf application may be made under this Act, the Court may, at its discretion, on application made by or on behalf of any 94 (1956) 95 CLR 494 at 523 per Fullagar J. (Emphasis added) such person, order that such provision as the Court thinks fit is made out of the estate of the deceased for that purpose." Sub-section 3 of s 6 provides: "(3) The Court may attach such conditions to the order as it thinks fit, or may refuse to make an order in favour of any person on the ground that his character or conduct is such as in the opinion of the Court to disentitle him to the benefit of an order, or on any other ground which the Court thinks sufficient." Under the Act, the classes of persons entitled to make an application under s 6(1) are defined by s 7. Section 7(1) provides: Persons entitled to claim (1) An application for provision out of the estate of any deceased person may be made under this Act by or on behalf of all or any of the following persons – a child of the deceased living at the date of the death of the deceased, or then en ventre sa mere; Similar legislation exists in each other Australian State95 and Territory96 and derives from legislation enacted in New Zealand in 190097. The purpose of the Act, and its Australian analogues, is to permit a court in certain cases to displace a testator's dispositions on application by specified persons, and indeed, not only a testator's dispositions, but also distributions according to the rules 95 See Family Provision Act 1982 (NSW); Administration and Probate Act 1958 (Vic); Testator's Family Maintenance Act 1912 (Tas); Inheritance (Family Provision) Act 1972 (SA); Succession Act 1981 (Q). 96 Family Provision Act 1969 (ACT); Family Provision Act (NT). 97 The Testator's Family Maintenance Act 1900 (NZ). For the history of the Australian provisions, see de Groot & Nickel, Family Provision in Australia, 2nd ed, (2001) at 1-5; Mason, The Principles and Practice of Testator's Family Maintenance in Australia and New Zealand, (1929) at 1-3. applicable to intestacies98. The Act does not impose any limitation on a testator's power of disposition. Nor does it confer a statutory entitlement upon specified persons to receive a certain portion of a deceased's estate. If however the statutory conditions are satisfied, then the court is empowered under the Act to alter a testator's disposition to produce a result that is consistent with the purpose of the Act. The court's power to do so is discretionary. In Singer v Berghouse99, this Court construed ss 7 and 9 of the Family Provision Act 1982 (NSW), which was couched in similar language to s 6 of the Act. Mason CJ, Deane and McHugh JJ held that under the provisions of the New South Wales Act, a court is required to undertake two inquiries. The first is whether an applicant has been left without adequate provision for his or her proper maintenance, education and advancement in life. The second inquiry, as to the provision that should be made, will only be necessary if the first is answered affirmatively. the "jurisdictional question". In respect of it their Honours, after quoting the well known passage from the judgment of Salmond J in In re Allen; Allen v Manchester100, said101: inquiry has been described as The first "For our part, we doubt that this statement [which referred to 'moral duty'] provides useful assistance in elucidating the statutory provisions. Indeed, references to 'moral duty' or 'moral obligation' may well be understood as amounting to a gloss on the statutory language102." Their Honours added103: "The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the 98 Section 6(2) of the Act. 99 (1994) 181 CLR 201 (Mason CJ, Deane and McHugh JJ, Toohey and Gaudron JJ dissenting). 100 (1921) 41 NZLR 218. 101 (1994) 181 CLR 201 at 209. 102 Hughes v National Trustees, Executors & Agency Co of Australasia Ltd (1979) 143 CLR 134 at 158; Goodman v Windeyer (1980) 144 CLR 490 at 504-505. 103 (1994) 181 CLR 201 at 209-210. applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty." We would not be reluctant, at least in some cases, to use the expressions "moral duty" and "moral obligation", and to apply the concepts underlying them, which include the idea of "moral claims". It seems to us that there are several material indications in the Act that moral considerations may be relevant. But before we refer to those indications we should make it clear that a moral claim cannot be a claim founded upon considerations not contemplated by the Act. Nor can it be a claim based simply upon the fact of a preference shown by a testator in his will for another or others, although there may be cases in which disparities in dispositions may be relevant. The first of the indications is the use of the word "proper". It implies something beyond mere dollars and cents. Its use, it seems to us, invites consideration of all of the relevant surrounding circumstances and would entitle a court to have regard to a promise of the kind which was made here. Unfortunately for the appellant however, and as will appear, the making of that promise is not the only, and is indeed, far from a conclusive fact in the appellant's favour. The use of the word "proper" means that attention may be given, in deciding whether adequate provision has been made, to such matters as what used to be called the "station in life" of the parties and the expectations to which that has given rise, in other words reciprocal claims and duties based upon how the parties lived and might reasonably expect to have lived in the future. The next of the indications is the expression, in comprehensive language, of the sorts of provision that the court may order, that is, provision by way of maintenance, support, education or advancement. "Maintenance" may imply a continuity of a pre-existing state of affairs, or provision over and above a mere sufficiency of means upon which to live. "Support" similarly may imply provision beyond bare need. The use of the two terms serves to amplify the powers conferred upon the court. And, furthermore, provision to secure or promote "advancement" would ordinarily be provision beyond the necessities of life. It is not difficult to conceive of a case in which it appears that sufficient provision for support and maintenance has been made, but that in the circumstances, say, of a promise or an expectation reasonably held, further provision would be proper to enable a potential beneficiary to improve his or her prospects in life, or to undertake further education. Significantly, and not inappropriately, one of the forms in which the appellant sought to put his case here was as a claim for advancement. That the idea of a "moral claim" may have been introduced as an aid to judicial deliberation before it was enacted that claims could be made upon intestate estates, does not, in our opinion render it less relevant or useful now that such claims may be made. In principle, there is no reason why effect should not be given to a moral claim upon the estate of an intestate estate in the same way as it would have been, had the deceased left a duly attested will. The last strong indication that moral duty, and what that can involve, moral considerations, is the reference in sub-s 3 of s 6 to disentitling character or conduct. It is clear from the way in which this sub-section is expressed, that moral considerations, in both the primary sense and any other sense in which "moral" can be used, may be relevant. What we have said, that moral duty and moral obligation may be relevant and within the contemplation of the Act, is generally consistent with a long stream of authority in this Court. In Coates v National Trustees Executors and Agency Company Limited104 Dixon CJ affirmed the several cases in New Zealand, the Judicial Committee and Australia which acknowledged and gave effect to moral claims. In the same case Williams J105 referred in terms to a "moral duty" as did Webb J106 and Kitto J107. Fullagar J was alone there in disparaging its utility108. In Pontifical Society for the Propagation of the Faith v Scales109 Dixon CJ (McTiernan J agreeing) again affirmed the line of authority, to which he referred in Coates, and invoked "moral duty" as an appropriate basis for provision. In Hughes v National Trustees, Executors and Agency Co of Australasia Ltd110 the Court was constituted by Barwick CJ, Gibbs, Mason, Murphy and Aickin JJ. In his judgment Gibbs J cited111 with approval the well-known 104 (1956) 95 CLR 494 at 509. 105 (1956) 95 CLR 494 at 512. 106 (1956) 95 CLR 494 at 516. 107 (1956) 95 CLR 494 at 526. 108 (1956) 95 CLR 494 at 523. 109 (1962) 107 CLR 9 at 20. 110 (1979) 143 CLR 134. 111 (1979) 143 CLR 134 at 146-147. passage of Salmond J in In re Allen; Allen v Manchester112 part of which was quoted in the joint judgment in Singer113. "The Act is ... designed to enforce the moral obligation of a testator to use his testamentary powers for the purpose of making proper and adequate provision after his death for the support of his wife and children, having regard to his means, to the means and deserts of the several claimants, and to the relative urgency of the various moral claims upon his bounty. The provision which the Court may properly make in default of testamentary provision is that which a just and wise father would have thought it his moral duty to make in the interests of his widow and children had he been fully aware of all the relevant circumstances." Mason J expressly agreed with the reasons of Gibbs J114. There only Murphy J115 rejected the notion of "moral claim". In Goodman v Windeyer116 the leading judgment was written by Gibbs J. Stephen J117, with a minor qualification, and Mason J118 without qualification agreed with Gibbs J. Once again his Honour had cited the passage from Allen quoted above. He also referred to a "special claim"119. For the second time in such a case Murphy J120 refused to countenance the existence and relevance of a "moral duty". In the joint judgment of Mason CJ, Deane and McHugh JJ in Singer v Berghouse121 their Honours said that the passage from Allen cited by Gibbs J 112 [1922] NZLR 218 at 220-221. 113 (1994) 181 CLR 201 at 209. 114 (1979) 143 CLR 134 at 157. 115 (1979) 143 CLR 134 at 159-160. 116 (1980) 144 CLR 490. 117 (1980) 144 CLR 490 at 503-504. 118 (1980) 144 CLR 490 at 504. 119 (1980) 144 CLR 490 at 497. 120 (1980) 144 CLR 490 at 504-505. 121 (1994) 181 CLR 201. provided no "useful assistance". They rejected the concepts of "moral duty" and "moral obligation"122 despite the fact that Mason CJ had expressly agreed on both of the earlier occasions to which we have referred with the reasoning of Gibbs J. For many years therefore several justices of this Court have found it convenient and generally useful to resort to the concepts of a moral duty and a moral claim in deciding both whether, and how much provision should be made to a claimant under the Act. In our respectful opinion they have not been wrong to do so. These are not concepts alien to, or in any way outside, the language of s 6 of the Act. We do not therefore think that the questions which the Court has to answer in assessing a claim under the Act necessarily always divide neatly into two. Adequacy of the provision that has been made is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably. Adequacy or otherwise will depend upon all of the relevant circumstances, which include any promise which the testator made to the applicant, the circumstances in which it was made, and, as here, changes in the arrangements between the parties after it was made. These matters however will never be conclusive. The age, capacities, means, and competing claims, of all of the potential beneficiaries must be taken into account and weighed with all of the other relevant factors. On any basis however in this case, we do not think that the appellant was entitled to succeed, whether a two staged inquiry is appropriate or not. The appellant has more than enough for his proper maintenance, support, education or advancement in life even assuming that the promise is relevant. It seems to us that the family settlement which was made in 1993 rendered the promise no longer relevant, or of any significance. The settlement ensured that the appellant would receive in money's worth everything, indeed somewhat more than the sum of his efforts over the years. The totality of the arrangements put this beyond doubt. That totality also took into account the fact that a promise had been made by including, as one of its components, the substantial gift by the testator's wife of $228,000 to the appellant. Why, it may be asked, should he now get more? Were he to receive the equivalent of the other third of the property, that is the further component that he says that he was promised, the disparity, to which we will refer in some detail later, between his means and those of the respondents would be even greater. The making of the promise may perhaps have given rise to a moral obligation, but that obligation must always have been subject to the satisfaction of other claims upon the bounty of the testator. It is not irrelevant that it was not demonstrated that had the appellant chosen to withdraw from the 122 (1994) 181 CLR 201 at 209. family business much earlier than he did, he would necessarily have been better off, either in 1994, or at the time of the hearing of his application. The appellant is a middle-aged, married father of one dependent child, and is of substantial means. At the time of his father's death, he and his wife had assets worth approximately $1.5m. No evidence was adduced at trial of the amount of money required (or desired) by the appellant for his "proper maintenance, support, education or advancement in life", and no suggestion could be made that the appellant was unable to meet, from his own resources, the cost of properly maintaining, supporting, educating or advancing himself in life. With respect to the appellant's "moral claim", the trial judge found that the appellant was "adequately compensated for the considerable effort, energy and expertise he devoted to the farming business". Although his drawings from the partnership were described as meagre, the income and capital that he took out of it over time were not. From 1979 to 1993, inclusive, the appellant received income of $580,298 and capital benefits of $838,533, totalling $1,418,831. The trial judge found that this was slightly more than one third of the total benefits received by his father, mother and himself. The financial positions of the respondents at the time of the testator's death are also relevant. The second respondent was aged 36 and married with three dependent children aged nine, seven and one. She and her husband had net assets of approximately $249,125. She was employed as a real estate sales representative and her husband was employed as a hospital orderly. The third respondent was aged 21 and single, with no dependants and lived with his mother at Albany. He had net assets of $35,512 and was a self- employed butcher. The fourth respondent was aged 38 and married with two dependent children aged 11 and two. She and her husband had net assets of approximately $147,409. She was employed as a receptionist and her husband was employed as a motor mechanic. The fifth respondent was aged 31 and married with two dependent children aged two and one. She and her husband had net assets of $159,414.42. She was employed as a bank officer and her husband was employed as a boilermaker. In comparison with the respondents, at the date of the hearing, the appellant and his wife had assets worth approximately $2,375,000 comprising property valued at approximately $505,600 and VSV Family Trust assets totalling about $1,869,000. Although it is true that the appellant's exertions contributed to the success of the family farming business, for the benefit of his father and ultimately perhaps the respondents generally, there is no suggestion that his exertions were in any way disproportionate to the exertions of his parents. There was no evidence that the appellant sacrificed other more lucrative or attractive opportunities to pursue the farming venture with his parents. The finding of the trial judge which was affirmed on appeal to the Court of Appeal, that the appellant does not have the "moral claim" that he asserted to share in his father's estate should not be disturbed. The Court of Appeal did not err in upholding the trial judge's decision that the appellant failed to demonstrate that he was left without adequate provision under his father's will. Accordingly, we would dismiss the appeal with costs.
HIGH COURT OF AUSTRALIA Matter No S66/2020 DVO16 AND APPELLANT MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR RESPONDENTS Matter No M109/2020 AND APPELLANT MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR RESPONDENTS DVO16 v Minister for Immigration and Border Protection BNB17 v Minister for Immigration and Border Protection [2021] HCA 12 Date of Hearing: 10 February 2021 Date of Judgment: 14 April 2021 S66/2020 & M109/2020 ORDER In each matter: Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation B W Walker SC with S G Lawrence for the appellant in S66/2020 (instructed by Norton Rose Fulbright) G A Costello QC with A Aleksov and M J Kenneally for the appellant in M109/2020 (instructed by Lander & Rogers) G R Kennett SC with H P T Bevan for the first respondent in S66/2020 (instructed by Clayton Utz) G R Kennett SC with N M Wood for the first respondent in M109/2020 (instructed by Clayton Utz) Submitting appearance for the second respondent in both matters Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS DVO16 v Minister for Immigration and Border Protection BNB17 v Minister for Immigration and Border Protection Immigration – Refugees – Application for protection visa – Where appellants each applied for protection visas – Where each appellant interviewed by delegate of Minister – Where each appellant assisted by interpreter in interview – Where interviews affected by translation errors in questions asked and responses given – Where Immigration Assessment Authority ("Authority") conducted review under Pt 7AA of Migration Act 1958 (Cth) – Where in case of DVO16, Authority not aware of translation errors – Where in case of BNB17, Authority aware of three translation errors – Where in each case Authority did not exercise powers to get new information under Pt 7AA – Where in each case Authority affirmed delegate's decision to refuse visa – Whether Authority's exercise of powers unreasonable – Whether Authority failed to comply with statutory duty to "review" decision under Pt 7AA. Words and phrases – "automatic merits review", "claims to protection in fact made", "de novo assessment of the merits", "failing to consider substance of claim", "fast track reviewable decision", "Immigration Assessment Authority", "interpretation", "interpretation error", "interpreter", "jurisdictional error", "mistranslation", "new information", "overriding duty", "reasonableness condition", "translation", "translation error". Migration Act 1958 (Cth), ss 51A(1), 54, 55, 56, 65, Pt 7AA. KIEFEL CJ, GAGELER, GORDON AND STEWARD JJ. These appeals from judgments of the Federal Court of Australia concern the effect on a review by the Immigration Assessment Authority under Pt 7AA of the Migration Act 1958 (Cth) of errors in the translation of questions asked and answers given at an interview between a referred applicant and a delegate of the Minister for Immigration and Border Protection conducted after the applicant applied for a protection visa and before the delegate decided to refuse the applicant a protection visa. One of the judgments under appeal, DVO161, is that of a Full Court constituted by Greenwood, Flick and Stewart JJ. The other, BNB172, is that of Anderson J alone exercising appellate jurisdiction. Each judgment dismissed an appeal from a judgment of the Federal Circuit Court of Australia. The Federal Circuit Court had in each case dismissed an application for judicial review of a decision of the Authority which had affirmed a decision of a delegate to refuse the applicant a protection visa. The conclusion reached in each case, by the Federal Circuit Court and again on appeal by the Federal Court, was that such translation errors as had occurred at an interview between the applicant and the delegate did not result in the decision of the Authority being affected by jurisdictional error. The conclusion was in each case correct. Translation and mistranslation The function of translation in a curial or administrative setting is interpretation of communications as accurately and completely as possible. The process of interpretation involves comprehension of words spoken or written in a source language, conversion to a target language, and delivery in a manner faithful both to the content of the words and to the register and style of the speaker or writer3. That, at least, is the ideal. Long past is the time when an interpreter might have been thought to be appropriately described as a "translating machine" or "bilingual transmitter" performing a function "not different in principle from that which in another case 1 DVO16 v Minister for Immigration and Border Protection (2019) 271 FCR 342. 2 BNB17 v Minister for Immigration and Border Protection [2020] FCA 304. Judicial Council on Cultural Diversity, Recommended National Standards for Working with Interpreters in Courts and Tribunals (2017) at 78-83. Gordon Steward an electrical instrument might fulfil in overcoming the barrier of distance"4. More accurate is to conceive of an interpreter as a "bilingual mediating agent between monolingual communication participants in two different language communities"5 and to recognise that "total equivalence" between words spoken or written in a source language and words translated into a target language is a "chimera"6. Translation is not a "simple word-matching exercise"7 but "a difficult and sophisticated art" which, "[t]o be done well", "requires not only linguistic sophistication and sensitivity to 'minor' linguistic details (which may be correlated with vast differences in conceptualization), but also an intimate knowledge of the cultures associated with the language in question, of the social and political organization of the relevant countries, and of the world-views and life styles reflected in the linguistic structure"8. Professor Wigmore noted the "peculiarity" of language that "the most perfect system of signs, the most richly developed language, leads only to a partial comprehension ... whose degree of completeness depends upon the nature of the subject treated, and the acquaintance of the hearer with the mental and moral character of the speaker"9. Imperfections in communication arising out of mistranslation of words spoken or written in one language into another language are inherent in the human condition, as are imperfections in communication arising out of misuse or misunderstanding of words spoken or written in a common language. "Perfect interpretations" simply "do not exist"10. 4 Gaio v The Queen (1960) 104 CLR 419 at 430-431. See also at 429, 432-433. 5 Bell, Translation and Translating: Theory and Practice (1991) at 15, quoting House, A Model for Translation Quality Assessment (1977) at 1. 6 Bell, Translation and Translating: Theory and Practice (1991) at 6. 7 Hale, Interpreter Policies, Practices and Protocols in Australian Courts and Tribunals: A National Survey (2011) at 2. 8 Dixon, Hogan and Wierzbicka, "Interpreters: Some basic problems" (1980) 5 Legal Service Bulletin 162 at 163. 9 Wigmore, The Science of Judicial Proof, 3rd ed (1937) at 569-571, quoting Whitney, Language and the Study of Language, 4th ed (1869) at 111. 10 Shulman, "No Hablo Inglés: Court Interpretation as a Major Obstacle to Fairness for Non-English Speaking Defendants" (1993) 46 Vanderbilt Law Review 175 at Gordon Steward Unsurprisingly therefore, questions not infrequently arise as to the effect of mistranslation on curial or administrative outcomes. Those questions cannot be answered through the application of a simple or uniform mode of analysis. Whether and if so in what circumstances mistranslation might result in invalidity of an administrative decision turns necessarily on whether and if so in what circumstances mistranslation might result in non-compliance with a condition expressed in or implied into the statute which authorises the decision- making process and sets the limits of decision-making authority11. In a decision- making process conditioned by a requirement to afford procedural fairness the content of which is implied by the common law, the effect of mistranslation on the resultant decision will turn on whether the mistranslation has resulted in "unfairness" in the decision-making process12 amounting to "practical injustice"13. In a decision-making process in which procedural fairness is excluded or is sufficiently provided if specific statutory requirements are met, the effect of a mistranslation on the resultant decision will turn on the "blunter question"14 of whether the mistranslation has resulted in one or more specific statutory requirements not being met. 177, quoted in Perera v Minister for Immigration and Multicultural Affairs (1999) 92 FCR 6 at 18 [26]. 11 Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123 at 132 [23], 145 [66]; Minister for Home Affairs v DUA16 (2020) 95 ALJR 54 at 59 [15]; 385 ALR 212 at 217. 12 SZRMQ v Minister for Immigration and Border Protection (2013) 219 FCR 212 at 13 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 14 [37]. 14 SZRMQ v Minister for Immigration and Border Protection (2013) 219 FCR 212 at 230 [74], citing Perera v Minister for Immigration and Multicultural Affairs (1999) 92 FCR 6. See also Singh v Minister for Immigration and Multicultural Affairs (2001) 115 FCR 1 at 6 [26]-[28]. Gordon Steward Mistranslation in the context of Pt 7AA Part 7AA, which has previously been examined in detail15, provides for the Authority to engage in "automatic merits review"16 of a "fast track reviewable decision", referred to it by the Minister, by which a delegate of the Minister has refused to grant a protection visa to the referred applicant at the conclusion of a primary decision-making process which commences with the applicant applying for a protection visa and which is governed by the Code of Procedure for dealing with visa applications in Subdiv AB of Div 3 of Pt 2. The Code of Procedure is "taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with"17. Though it contains no requirement for a visa applicant to be interviewed, the Code of Procedure permits the Minister or a delegate, "if he or she wants to", to "get any information that he or she considers relevant" by means which include an interview between the applicant and an officer of the Department of Immigration and Border Protection18. In practice, officers of the Department who are delegates of the Minister and who will go on to make the primary decisions to grant or refuse protection visas routinely conduct interviews with the applicants for those visas. The interviews, known as "protection interviews", are conducted with the assistance of interpreters and are routinely audio-recorded but not routinely transcribed. Despite containing no requirement for the applicant to be interviewed, the Code of Procedure imposes obligations on a delegate having conducted an interview with the applicant in going on to decide whether to grant or refuse the protection visa both to "have regard to" relevant information "given" by the 15 Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 222-232 [6]-[38]; CNY17 v Minister for Immigration and Border Protection (2019) 94 ALJR 140 at 144-145 [2]-[8]; 375 ALR 47 at 48-50; ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 932-937 [1]-[25]; 383 ALR 407 at 408-414. 16 CNY17 v Minister for Immigration and Border Protection (2019) 94 ALJR 140 at 144 [2]; 375 ALR 47 at 48; ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 949 [79]; 383 ALR 407 at 431. 17 Section 51A(1) of the Migration Act. 18 Sections 56 and 58(1)(d) of the Migration Act. Gordon Steward applicant in the interview19 and to "have regard to" information "got" by the delegate in the interview considered by the delegate to be relevant20. Non- compliance with either of those obligations can result in invalidity of the delegate's decision21. Each obligation to "have regard to" information is an obligation to engage in "'an active intellectual process' directed at the information"22. Mistranslation of words spoken during the protection interview has the potential to cause the intellectual process in fact engaged in by the delegate to be misdirected. Mistranslation in that way has the potential to result in non-compliance with a condition of validity of the decision of the delegate imposed by the Code of Procedure. More fundamentally, mistranslation has the potential to result in the delegate failing to understand and therefore to consider the substance of a claim to protection in fact raised by the applicant in words spoken in his or her own language during the protection interview. Mistranslation in that way has the potential to result in the delegate failing to discharge the core element of the primary statutory duty to decide whether to grant or refuse the protection visa23, being to assess the claims to protection in fact raised by the applicant against the criteria for the grant of a protection visa to determine whether or not the delegate is satisfied on the totality of the information available to the delegate that those criteria have been met24. 19 Sections 54(1), (2)(c) and 55(1) of the Migration Act. 20 Section 56(1) of the Migration Act. 21 Minister for Home Affairs v Ogawa (2019) 269 FCR 536 at 556-558 [95]-[102]. 22 Minister for Home Affairs v Ogawa (2019) 269 FCR 536 at 557 [101], quoting Singh v Minister for Immigration and Multicultural Affairs (2001) 109 FCR 152 at 164 23 Section 65 of the Migration Act. 24 cf Dranichnikov v Minister for Immigration and Multicultural Affairs (2003) 77 ALJR 1088 at 1092 [24]-[25], 1101 [86]-[89], 1102 [95]; 197 ALR 389 at 394, 406- Gordon Steward Non-compliance by a delegate with one or other of those conditions of the making of a valid primary decision to grant or refuse a protection visa, however, is of itself of no consequence for the subsequent exercise of jurisdiction by the Authority. That is because the statutory duty of the Authority to "review" a fast track reviewable decision25 is triggered simply by referral by the Minister of a decision to refuse to grant a protection visa that has been made by a delegate in fact26. Nor is compliance by the Secretary of the Department with the consequent procedural duty to give to the Authority specified categories of "review material"27 affected by errors in the translation of words spoken during the protection interview. Words spoken by the applicant during the interview, having no enduring physical existence, are not themselves within the category of "material provided by the referred applicant to the person making the decision before the decision was made"28. Rather, the physical embodiment of the totality of the words spoken during the interview (by the applicant, the delegate and the interpreter) in the form of the recording of the interview is within the separate category of "other material that is in the Secretary's possession or control"29. Whether or not analysis of the recording might reveal translation errors, the Secretary could not but consider the recording to be "capable directly or indirectly of rationally affecting assessment of the probability of the existence of some fact about which the Authority might be required to make a finding"30 and, for that reason, to be "relevant to the review"31. The Secretary would on that basis be obliged to give the recording to the 25 Section 473CC of the Migration Act. 26 Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 221 [3]-[4]. 27 Section 473CB of the Migration Act. 28 Section 473CB(1)(b) of the Migration Act. 29 Section 473CB(1)(c) of the Migration Act. 30 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 933 [6]; 383 ALR 407 at 410, quoting CNY17 v Minister for Immigration and Border Protection (2019) 94 ALJR 140 at 144-145 [6]; 375 ALR 47 at 50. 31 Section 473CB(1)(c) of the Migration Act. Gordon Steward Authority32 irrespective of the translation errors it might contain. Save to the extent that translation errors might be indicated or corrected by other material in the Secretary's possession or control, which the Secretary would similarly be required to give to the Authority, the Secretary has no obligation under the Part to investigate or correct translation errors that might exist in any of the review material given to the Authority. The overriding duty of the Authority to "review" the fast track reviewable decision referred to it by the Minister33 is accompanied by a procedural duty to conduct that review by "considering" the review material provided to it by the information", being "a Secretary without accepting or requesting "new communication of knowledge about some particular fact, subject or event"34 that was not before the Minister when the delegate made the referred decision, and without interviewing the referred applicant35. That procedural duty as to the manner of conduct of the review is qualified only by the Authority having specific procedural powers to "get"36 new information and in specified circumstances37, and on specified conditions38, to "consider" that new information. Performance of the procedural duty subject to the potential for exercise of these powers exhausts the requirements of "the natural justice hearing rule"39 in relation to the review40. 32 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 934 [12]; 383 ALR 407 at 411. 33 Section 473CC of the Migration Act. 34 Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 228 [24]. 35 Section 473DB of the Migration Act. 36 Section 473DC of the Migration Act. 37 Section 473DD of the Migration Act. 38 Sections 473DE and 473DF of the Migration Act. 39 Section 473DA of the Migration Act. 40 BVD17 v Minister for Immigration and Border Protection (2019) 93 ALJR 1091 at 1099 [33]-[35]; 373 ALR 196 at 204-205. Gordon Steward The Authority performs its duty to consider the review material provided to it by the Secretary by examining the review material physically provided to it so as to form and act on its own assessment of the relevance of that material to the review of the referred decision41. It is then up to the Authority to give each part of the material that it thinks relevant such weight in making findings of fact as it thinks is warranted in arriving at its decision on the review. The Authority is not disabled from performing its duty to consider the review material by translation errors that might exist in any part of the review material. How then, if at all, might translation errors in a recording of a protection interview provided to the Authority by the Secretary as part of the review material result in non-compliance with any condition of a decision of the Authority expressed in or implied into Pt 7AA? Two potentialities present themselves, but only two. The first arises from the condition of reasonableness implied into the procedural duty of the Authority to review the referred decision by considering the review material and implied as well into the procedural powers of the Authority to get new information at an interview with the referred applicant and then to consider that new information if the Authority is satisfied that specified conditions are met42. The conditions for the consideration of new information are met if the Authority is satisfied, relevantly, that it is credible information about the referred applicant not previously known to the Minister which may have affected consideration of the referred applicant's claims had the new information been known to the Minister43 and that "exceptional circumstances" justify its consideration44. Where the referred applicant's testimony as given at a protection interview was incorrectly translated, testimony able to be given by the referred applicant at an interview with the Authority as correctly translated would amount 41 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 933 [7]; 383 ALR 407 at 410, quoting CNY17 v Minister for Immigration and Border Protection (2019) 94 ALJR 140 at 145 [7]; 375 ALR 47 at 50. 42 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 933 [3]; 383 ALR 407 at 409. 43 Section 473DD(b)(ii) of the Migration Act. See Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 230-231 [33]-[34]. 44 Section 473DD(a) of the Migration Act. See Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 229 [30]. Gordon Steward to new information which might well meet those conditions for consideration by the Authority. Faced with translation errors in a recording of a protection interview revealed or suggested by the review material provided by the Secretary, considered alone or in light of such submissions as might be made on behalf of the referred applicant during the course of the review, the Authority would have the potential to breach the reasonableness condition implied into its powers to get and consider new information were it to fail to exercise those powers to interview the referred applicant and then to consider the referred applicant's testimony as correctly translated. Equally, the Authority would have the potential to breach the reasonableness condition implied into its duty to review the referred decision by considering the review material were it to make findings adverse to the referred applicant with knowledge of translation errors without having exercised its procedural powers to get and consider new information which might address those errors. Whether or not the decision of the Authority was reached in breach of the reasonableness condition implied into its procedural duty and powers would turn, on either analysis, on whether the decision-making course in fact adopted by the Authority in the circumstances known to it45 was open to a reasonable member of the Authority cognisant of the statutory obligation of the Authority ordinarily to conduct its reviews without accepting or requesting new information or interviewing the referred applicant, cognisant of its powers to get new information in an interview with the referred applicant and to consider that information, and mindful of the statutory exhortation to the Authority to pursue the objective of providing a mechanism of limited review that is both "efficient" and "quick"46. The second way in which translation errors in a recording of a protection interview provided to the Authority by the Secretary as part of the review material could result in non-compliance with Pt 7AA is through non-compliance with the overriding duty of the Authority to "review" the referred decision47. That overriding duty of the Authority is to engage in a de novo assessment of the merits of the decision in fact made by the delegate: "to consider the application for a 45 Minister for Home Affairs v DUA16 (2020) 95 ALJR 54 at 61 [26]; 385 ALR 212 at 46 Section 473FA of the Migration Act. 47 Section 473CC of the Migration Act. Gordon Steward protection visa afresh and to determine for itself whether or not it is satisfied that the criteria for the grant of the visa have been met"48. The Authority's de novo assessment of the merits is not of a lesser standard than that required of the delegate in making the referred decision. No less than the delegate in making the referred decision, the Authority in reviewing the referred decision is required to assess the claims to protection in fact raised by the referred applicant against the criteria for the grant of a protection visa in order to determine whether or not to be satisfied that those criteria have been met. Just as mistranslation of words spoken during a protection interview has the potential to result in the delegate failing to understand and therefore to consider the substance of a claim in fact raised by the applicant in his or her own language, so the same mistranslation has the potential to result in the Authority failing to understand and therefore to consider the substance of the same claim. Mistranslation in that way has the potential to result in the Authority failing to discharge the core element of its overriding duty, namely to assess the claims to protection in fact made by the applicant against the criteria for the grant of the visa in determining for itself whether or not it is satisfied that the criteria for the grant of a visa have been met. Neither of those potentialities manifested in the circumstances considered in the judgments under appeal. DVO16 The appellant in DVO16 is a Shia Muslim from Khuzestan province in Iran. He identifies as an Ahwazi Arab. In his written application for a protection visa, the appellant raised two overlapping claims to protection. He claimed to fear persecution resulting from the failure of the Iranian state to protect him from harm inflicted by another tribal group in Iran (described as the Jalali or Chanani tribe) resulting from a specific incident on a bus by reference to which he was alleged to have had physical contact with a woman from that other tribe. He also claimed to fear persecution resulting from the failure of the Iranian state to protect him more generally from harm inflicted by another tribal group by reason of his ethnicity as an Ahwazi Arab. 48 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 933 [5]; 383 ALR 407 at 409, quoting Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 226 [17]. Gordon Steward The appellant participated in a protection interview with the delegate who went on to decide to refuse him a protection visa at which the appellant spoke an Arabic dialect from the Khuzestan region of Iran. The interpreter spoke urban Levantine Arabic. The interview was audio-recorded. The Minister referred the decision of the delegate refusing the protection visa to the Authority for review, following which the Secretary gave the recording of the protection interview to the Authority as part of the review material. The Authority affirmed the decision of the delegate. Expert evidence later adduced in the Federal Circuit Court on the appellant's application for judicial review of the decision of the Authority revealed mistranslation of a question asked by the delegate about the appellant's claim to fear harm resulting from the failure of the Iranian state to protect him from persecution inflicted by reason of his ethnicity. The result of the mistranslation was that the delegate, and later the Authority, misapprehended that the appellant did not understand what was meant by "ethnicity". The truth was that the appellant did not understand what was meant by "persecution". The delegate then said that the interview would "start again", which the interpreter failed to interpret. In an exchange imperfectly interpreted, the delegate then went on to ask the appellant what exactly he feared would happen to him if he were to return to Iran, to which the appellant responded that he feared that he might be killed by members of the Chanani tribe. In later exchanges, the delegate also asked a number of open-ended questions giving the appellant the opportunity to give evidence about whether there was anything he feared if he were to return to Iran "apart from issues to do with the Chanani tribe". In response to each question, the appellant referred back to the tribal dispute or otherwise failed to say anything to establish his claim of persecution on the basis of ethnicity. The Authority recorded in its reasons for decision that the appellant claimed that he feared persecution by reason of his ethnicity. The Authority went on to explain in its reasons for decision that, having regard to country information which it specified and to aspects of the appellant's circumstances which it also specified, it was not satisfied that the appellant would face a real chance of serious harm on return to Iran as an Ahwazi Arab. The mistranslations indicated by the expert witness could not have borne on the reasonableness of the course adopted by the Authority in reaching its decision. Nor did the mistranslations result in the Authority failing to understand and consider the substance of either of the appellant's claims. Gordon Steward The appellant in BNB17 is a Hindu Tamil from Sri Lanka. He claimed in his written application for a protection visa to fear persecution by reason of imputed links to the Liberation Tigers of Tamil Eelam ("LTTE"). He claimed that he had been detained by police in Colombo on some five occasions between 2006 and 2009, had been tortured by the Criminal Investigation Division ("CID") on the second occasion and had been detained for a number of hours on the last occasion. He also claimed that he had been required to report to the local police station and answer questions after returning from Colombo to his home in Karaveddy in 2010. The appellant participated in a protection interview with the delegate who later refused the protection visa. He was legally represented. The appellant claimed in the interview for the first time that he had been sexually tortured by the CID when detained in Colombo in 2009 and that he had been beaten by police when required to report to the local police station after returning to Karaveddy in 2010. The interview was audio-recorded and the recording was evidently provided to the appellant's legal representative. Not long after the protection interview, the appellant's legal representative made a "post-hearing submission" to the delegate. The legal representative wrote in the post-hearing submission that she had reviewed parts of the recording of the interview with the assistance of a Tamil interpreter and had concerns about the accuracy of the translation. The legal representative gave three examples of interpretation errors. The first was that a straightforward statement of the appellant that he feared harm from "army, CID, police" had been mistranslated as a statement that he feared harm as well from "other people". The second was that, when asked to explain what he meant by his claim to have been beaten, the appellant had given an answer to the effect that he had been beaten to find out whether he was a member of the LTTE or supported the LTTE. The substance of his answer had not been translated and the interpreter had instead gone off on a "tangent". The third was that, apparently by reason of the discomfort of the interpreter in dealing with the subject matter, a reference by the appellant to "sexual assault" had been mistranslated as "sexual harassment". The legal representative urged that the appellant be "afforded the benefit of the doubt in assessing the evidence given at his interview" and that the conduct of the interpreter "be given weight" in that assessment. Attached to the post-hearing submission was a statutory declaration of the appellant restating his claim to have been sexually tortured by the CID when in Colombo in 2009 and giving a cultural explanation for why he had not made the claim before the interview. In his written reasons for his decision refusing a protection visa, the delegate directly addressed the concerns about the accuracy of the translation that had been Gordon Steward raised by the legal representative in the post-hearing submission and rejected them as not "credible". The delegate noted that the interview had been conducted with the assistance of an accredited Tamil interpreter, recorded that "[f]or the most part during the interview it appeared that all parties were able to communicate clearly", and stated that he was "satisfied that the [appellant] was able to understand the interpreter and that he provided detailed responses to questions asked of him". After referral by the Minister of the delegate's decision to the Authority for review and provision by the Secretary of the recording of the protection interview to the Authority as part of the review material, the appellant's legal representative made a written submission to the Authority drawing attention to the concerns about the accuracy of the translation that had been raised in the post-hearing submission. The legal representative requested that the Authority itself interview the appellant if it had concerns about his credibility. The Authority made its decision to affirm the decision of the delegate without conducting the requested interview. The Authority explained in its reasons for decision that it was not satisfied that the circumstances of the case required it to invite the appellant to attend an interview but that it had borne the appellant's legal representative's post-hearing submission in mind in making its decision. The Authority went on to explain in its reasons for decision that it rejected the appellant's claims to have been sexually tortured by the CID in Colombo in 2009 and to have been beaten by police in Karaveddy in 2010. The Authority rejected those claims in part by reference to the appellant having failed to raise them at any time before the protection interview and in part by reference to the Authority's assessment of the appellant's responses to questions asked by the delegate during the interview. The Authority found his responses to have been "vague" and "evasive". On the appellant's application for judicial review of the decision of the Authority in the Federal Circuit Court, a transcript of the audio-recording of the protection interview was adduced in evidence on his behalf. The transcript was explained to have been compiled by a graduate lawyer having transcribed the words spoken in English and a Tamil interpreter having translated the words spoken in Tamil. On the hearing of the appeal to this Court, attention was focussed on two translation errors revealed by the transcript. The first translation error revealed by the transcript pertains to the subject matter of the second of the examples given by the appellant's legal representative in her post-hearing submission to the delegate: the appellant's response when asked by the delegate to explain what he meant by his claim to have been beaten. The delegate's initial question as to what the appellant meant when he used the word Gordon Steward "beating" was part of a somewhat confused exchange between the delegate, the interpreter and the appellant in the course of which the interpreter did not convey the appellant's use of the word "tortured" but instead said "beaten many time". Yet, as Anderson J found in the Federal Court49, the conversation is shown by the transcript to have "reset". The substance of the question was repeated and correctly translated several times. The second translation error revealed by the transcript concerns a question asked by the delegate as to why the appellant had not previously claimed to have been physically harmed after 2009. The question was wrongly translated as asking why the appellant had not claimed to have been physically harmed before 2009. The mistranslation led again to some confusion in communication between the delegate, the interpreter and the appellant. However, the question was asked again at a later stage of the interview, when it was correctly translated and answered by the appellant. Neither individually nor in combination do the translation errors revealed by the transcript provide a basis for concluding that the Authority failed to understand and therefore to consider the substance of the claims in fact made by the appellant in the Tamil language during the interview. The Authority did not fail in its fundamental and overriding duty to conduct the review. The distinct question of reasonableness must be determined by reference to the information available to the Authority in conducting the review at a time when the transcript did not exist. The Authority had the recording of the protection interview as part of the review material and was made aware of the three examples of translation errors set out in the post-hearing submission. Those errors were not so grave or extensive as to compel the Authority to the conclusion that it was incapable of assessing the appellant's claims by reference to the recording. The Authority, moreover, was entitled to place weight on the delegate's opinion that the translation errors had not impeded clear communication during the interview. The choice of the Authority to proceed on its own assessment of the appellant's claims as recorded and translated in the protection interview rather than conduct a new interview with the appellant was well within the bounds of reasonableness. Disposition Each appeal is to be dismissed with costs. 49 BNB17 v Minister for Immigration and Border Protection [2020] FCA 304 at [72]. Edelman Introduction The common theme across these two appeals is the effect of erroneous interpretations of a visa applicant's evidence given in a foreign language. The appeals raise the question of when the Immigration Assessment Authority will fall into jurisdictional error in its conduct of a review under Pt 7AA of the Migration Act 1958 (Cth) where such erroneous interpretations are contained within the review material provided to it by the Secretary of the Department. In each of these matters, the appellant, DVO16 and BNB17 respectively, had applied for a protection visa. Each had been interviewed by a delegate of the Minister who, in each case, subsequently refused the application. In each case, the Authority affirmed the decision of the delegate. DVO16 and BNB17 each sought judicial review of the decision of the Authority in the Federal Circuit Court of Australia. Each application was dismissed50. Appeals from the decisions of the Federal Circuit Court were dismissed by, respectively, the Full Court of the Federal Court of Australia51 and a single Justice of the Federal Court of Australia exercising the power of a Full Court52. In each case, a central issue on appeal concerned whether errors in interpretation during the interview with the delegate resulted in the decision of the Authority being affected by jurisdictional error. In each case, the audio recording of the interview with the delegate formed part of the review material provided by the Secretary to the Authority to conduct its review. There are at least three categories of error by an interpreter which might lead to a jurisdictional error by the Authority or a failure of a condition of the Authority's jurisdiction. The three categories of interpretation error discussed below are in ascending order of seriousness. First, if significant interpretation errors are apparent to the Authority then the errors might require, as a matter of legal reasonableness, the exercise of statutory power by the Authority to remedy the errors. The power might be to get new information under s 473DC of the Migration Act such as by obtaining a fresh interpretation of the foreign language spoken in the interview or, more exceptionally, by an invitation to the applicant to an interview with the Authority. Secondly, the interpretation errors might be so significant in critical respects that the Secretary will be unable, even by the 50 DVO16 v Minister for Immigration and Border Protection [2018] FCCA 3058; BNB17 v Minister for Immigration and Border Protection [2019] FCCA 1314. 51 DVO16 v Minister for Immigration and Border Protection (2019) 271 FCR 342. 52 BNB17 v Minister for Immigration and Border Protection [2020] FCA 304. Edelman broadest or most general of descriptions, to perform the duty – which is a precondition for a valid review by the Authority – of giving the Authority a statement that contains reference to the evidence on which the findings of the delegate were based53. Thirdly, and whether or not the interpretation errors are known to the Authority, the interpretation errors might be so extreme that they deprive the assessment by the Authority of its required character as a "review" under s 473CC of the Migration Act. A fourth possibility can be put to one side. This possibility is that interpretation errors might result in a breach of the natural justice hearing rule that would be implied as part of the interpretation of express provisions54 in Div 3 of Pt 7AA concerning the conduct of a review. The present state of the law is that the terms of s 473DA(1) – requiring the rules for the conduct of a review in Div 355 to be "taken to be an exhaustive statement of the requirements of the natural justice hearing rule" – mean that, unlike other Divisions with similar provisions56, Div 3, being said not to have excluded any expressions of natural justice but somehow excluding implications from those expressions, has effectively excluded the requirements of the natural justice hearing rule57. The grounds of appeal in both appeals raise matters related to each of the three categories of error by an interpreter which might lead to lack of jurisdiction of the Authority. One ground of appeal in BNB17 v Minister for Immigration and Border Protection concerns the first category: the interpretation errors were sufficiently significant as to require the Authority to get new information under s 473DC or to take any other step to mould its procedure to cure the errors. The other ground of appeal in BNB17, and the sole ground of appeal in DVO16 v Minister for Immigration and Border Protection, concerns the second and third categories: the errors in interpretation during the interview meant that the review material provided by the Secretary to the Authority was incomplete and that the Authority failed to complete its statutory review task. 53 Migration Act 1958 (Cth), s 473CB(1)(a)(ii). 54 See Merchant Service Guild of Australasia v Newcastle and Hunter River Steamship Co Ltd [No 1] (1913) 16 CLR 591 at 624; Lubrano v Gollin & Co Pty Ltd (1919) 27 CLR 113 at 118; R v Rigby (1956) 100 CLR 146 at 151; Wurridjal v The Commonwealth (2009) 237 CLR 309 at 368 [120]. 55 Together with Migration Act, ss 473GA and 473GB. 56 Migration Act, ss 51A, 97A, 118A, 127A, 357A, 422B. 57 See BVD17 v Minister for Immigration and Border Protection (2019) 93 ALJR 1091; 373 ALR 196. But compare Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421 at 442 [34]. Edelman For the reasons below, although the interpretation errors resulted in erroneous reasoning by the Authority in the BNB17 case and potential procedural unfairness in the DVO16 case if DVO16 had been denied the opportunity to put any material aspect of his case at an interview with the delegate, the Authority committed no jurisdictional error and did not lack jurisdiction. The appeals must be dismissed. The nature of interpretation errors and the alleged errors in these cases The nature of interpretation errors Interpretation and translation are nouns that are now commonly used interchangeably, although the former is generally used in relation to oral words and the latter is generally used in relation to written words. But this common usage disguises important differences in concept, if not in etymology. The art of interpreting is the art of explaining meaning. It is not an exercise in literal rendering that might be connoted by translation of words. For instance, a sufficient interpretation of Greek words58 to the effect that "[t]he spirit is willing, but the flesh is weak" might require further elucidation to convey meaning. That elucidation might be that "good intentions can be defeated by human weakness". But it would not be that "alcohol is desired when meat is rotten". Inaccuracy in conveying meaning by literal interpretation is not the only reason that an interpreter will constantly be exercising evaluative judgment. Other reasons include that: in some languages there is no close match for some English words; grammatical constructs can lead to subtle but important changes in meaning; and linguistic devices and habits can change depending upon the region where a language is spoken. Numerous examples were identified decades ago. So it has been said: in English the "morning" finishes, and the "afternoon" starts, at noon but in Polish the morning finishes at 11 am and the afternoon starts at 3.30 pm59; the concept of "family" changes dramatically according to cultural context60; and the "undifferentiated English 'you' cannot be translated into Italian, 58 Matthew 26:41. 59 Australian Law Reform Commission, Manner of Giving Evidence, Evidence Reference Research Paper No 8 (1982) at 94-95. 60 Dixon, Hogan and Wierzbicka, "Interpreters: Some basic problems" (1980) 5 Legal Service Bulletin 162 at 163. Edelman Spanish, Polish, German, Russian or Serbian" because a more or less formal method of address must be chosen in those languages61. The goal of interpretation therefore is to use judgment in order to "express in one language, as accurately as that language and the circumstances permit, the idea or concept as it has been expressed in the other language"62. Of course, perfect accuracy and complete clarity in expressing a concept from a foreign language are impossible. And as interpretation moves along a spectrum from the reasonably accurate to the clearly erroneous, the dangers of misunderstanding can also be multiplied by other matters. The possibility or extent of error is further enhanced where, as unfortunately occurred on occasion in the interpretations in these appeals, an interpreter does not interpret all the words spoken by one person and engages in uninterpreted conversation with the interviewer or interviewee. The errors that can arise from interpretation are not limited to the consequences of incorrect interpretation. They extend also to the pernicious effect of adverse credibility assessments based upon matters of demeanour and impression. A former member of the Refugee Review Tribunal has correctly described how "[t]he utilisation of demeanour, without more, to substantiate adverse credibility findings is 'fraught with dangers'"63. Empirical studies have also suggested that the medium of an interpreter can affect assessment of demeanour, and therefore credibility, "by the interpreter's voice, dress, mannerisms, linguistic competence, age, race and gender"64. As Professor Groves has observed, decision-makers "may struggle to distinguish between the words and demeanour of an interpreter and those of the person being interpreted"65. Further, the unspoken relationship between the interviewee and the interpreter, especially if there is not 61 Dixon, Hogan and Wierzbicka, "Interpreters: Some basic problems" (1980) 5 Legal Service Bulletin 162 at 164. 62 Perera v Minister for Immigration and Multicultural Affairs (1999) 92 FCR 6 at 19 [29]; SZRMQ v Minister for Immigration and Border Protection (2013) 219 FCR 63 Norman, "Assessing the Credibility of Refugee Applicants: A Judicial Perspective" (2007) 19 International Journal of Refugee Law 273 at 289. See also WAEJ v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 76 ALD 64 Barnett, "Mind your Language – Interpreters in Australian Immigration Proceedings" (2006) 10 University of Western Sydney Law Review 109 at 111-112. 65 Groves, "Interpreters and Fairness in Administrative Hearings" (2016) 40 Melbourne University Law Review 506 at 512-513. Edelman complete trust between them, can sometimes present a distorted impression of, or distorted context for, the interpreted words66. These problems for credibility assessments based, in part, upon impression and demeanour are compounded by cultural issues that may not be known to the decision-maker such as the impoliteness in some cultures of direct responses to questions or the extreme discomfort involved in discussion of some topics in particular cultures67. All of these considerations compound the usual problems of assessment of demeanour, particularly in the context of evidence in an atmosphere that is very commonly one of high pressure and which also can commonly concern highly distressing matters. Indeed, in the BNB17 case itself, the Authority observed, of circumstances of sexual assault against those of BNB17's ethnicity, that there was "ample credible country information that sexual assault has been engaged in by the authorities" in a systematic way. As explained below, part of the reasoning of the Authority in the BNB17 case was that BNB17 gave his evidence in a manner that was "vague and evasive". This finding by the Authority was an intermediate step in the Authority's reasoning. It was not submitted, nor could it have been submitted, that the finding meant that the Authority's reasons for decision were so irrational or illogical or so unsupported by any intelligible justification as to involve an unreasonable exercise of the Authority's duty to give reasons68. And the Authority's reasoning in this respect was not the subject of any other duty, function, or power to which the requirement of legal reasonableness could attach. Hence, even if the finding was not open it was not a jurisdictional error. Nevertheless, and in light of the understandable focus by counsel for BNB17 upon this aspect of the Authority's reasoning, it is necessary to reiterate the extreme caution that should be exercised by an Authority before making, or accepting, adverse demeanour findings based upon an audio recording of an interview that involved interpreted evidence. The assessment by the Authority, based upon the audio recording, that BNB17 was "vague and evasive" is the type of reasoning that should be made with great caution and only in rare circumstances. In the BNB17 case it is unclear whether the Authority considered any of the following matters, each of which, individually, might have been sufficient to preclude the "vague and evasive" conclusion. First, an impression of vagueness or evasiveness is often the 66 See also Taylor, "Informational Deficiencies Affecting Refugee Status Determinations: Sources and Solutions" (1994) 13 University of Tasmania Law Review 43 at 69-70. 67 Norman, "Assessing the Credibility of Refugee Applicants: A Judicial Perspective" (2007) 19 International Journal of Refugee Law 273 at 287. 68 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 959 [128]-[129]; 383 ALR 407 at 444-445. Edelman consequence of even minor errors or imprecisions in interpretation or context. And there were, at least, imperfections in the interpretation of parts of the interview, to which imperfections the Authority had been alerted. Secondly, the interview plainly had very large consequences for BNB17's life, a circumstance of pressure that demands caution even in assessments of demeanour uncomplicated by interpretation or cultural considerations. Thirdly, the manner in which BNB17 gave his evidence was likely to have been affected by cultural considerations. Fourthly, the interview involved matters that on BNB17's account required the recall and expression of highly personal, extremely unpleasant and traumatic experiences. The interpretation errors alleged by BNB17 BNB17's claim for protection was based upon claims that Sri Lankan authorities would persecute him due to his Tamil ethnicity and suspicion of involvement with the Liberation Tigers of Tamil Eelam ("the LTTE"). In his written application he alleged: that his father was a member of the LTTE; that his brother had been arrested, detained for ten months, beaten and tortured; that he had been detained by the police five times between 2006 and 2009 and tortured on the second occasion by members of the Criminal Investigation Division; and that after the war, he felt constantly threatened and harassed and was required to report to the local police station to answer questions and to drive members of the Criminal Investigation Division in his vehicle. At his protection visa interview, BNB17 also alleged that he had been sexually assaulted on an occasion when he was detained by the Criminal Investigation Division in 2009 and that he had been beaten by the police when he reported to the local police station. The Authority accepted some of BNB17's claims but it rejected others. In particular, the Authority rejected BNB17's claim in his protection visa interview that he was beaten by the police when he reported to the local police station. The Authority described BNB17's manner of giving evidence in his interview as "vague and evasive when asked about this claim". The Authority rejected submissions that BNB17 had not understood the question about being beaten and suggestions that the question should have been rephrased. It dismissed concerns expressed by the representative of BNB17 regarding the quality of the interpretation. The Authority observed that during the interview the delegate had repeated on three occasions the question "what do you mean by beaten?" and that the delegate had asked BNB17 "what did they do?". The Authority observed that BNB17 was "unable to provide any detail around his claim to have been beaten". Ultimately, the Authority concluded that BNB17 did not meet the requirements of the definition of a refugee in s 5H(1) of the Migration Act. BNB17 had made submissions to the delegate after the interview, but before the delegate's decision, about inaccuracies in the interpretation. Following the delegate's decision, BNB17's representative provided submissions to the Authority about inaccuracies in interpretation. The submissions were made fewer than four Edelman weeks after the delegate's decision, no doubt with an eye to the statutory requirement for the Authority to proceed quickly and efficiently69. It was submitted on behalf of BNB17 that conclusions about demeanour need "to be made in the context of an interview with clear and accurate interpreting" and that, in light of doubts about the interpretation, BNB17 should be afforded a further interview by the Authority if it had doubts about his credibility. BNB17's representative explained, as had also been explained to the delegate, that parts of the interview had been reinterpreted from the recording of the interview with the delegate. The reinterpretation had been made with the assistance of an independent Tamil interpreter provided by an interpreting agency, and three alleged errors in the interview interpretation had been identified. The first alleged error concerned an interpretation of BNB17's response to being asked from whom he feared harm. The interpreter at the interview said that BNB17's answer was "Army, CID, police or other people I am in fear". The correct interpretation of BNB17's response was said to be "[t]he forces of the government – Army, CID, police". The second alleged error was a group of misinterpretations concerning BNB17's evidence about being beaten. The interpretation of BNB17's evidence during the interview had led the delegate to ask BNB17 to explain "specifically what you mean by many times they were beating you". BNB17's response to that question was interpreted as "[t]heir nature is ... they have to keep us always intimidated, intimidating, and making fear, and that sort of thing". But the independent interpreter who later reviewed the recording advised that BNB17 had not said that he was beaten many times; rather he had said words to the effect of "[t]hey beat me because they want to find out, by inflicting pain, whether I am a member of the LTTE or supporting the LTTE". The third alleged error concerned BNB17's evidence of sexual assault, which, at one point, had been interpreted using the words "sexual harassment". In this Court, the central focus was upon the second alleged error involving the group of misinterpretations. BNB17 relied upon evidence from an interpreter who provided another interpretation of the oral interview. An extract of the relevant parts of that new interpretation reveals the following exchange between the delegate, the interpreter at the interview, and BNB17: "Delegate: OK. Is there anything else you would like to talk to me about in regards to things that have occurred since May 2009 onwards? INT: Is there any things else you want to tell happened after 2009 until now which has affected you personally affected you? BNB17: The thing affected me is the thing they tortured me that's it. I had the fear. Because they call me at anytime for their small jobs beat me. It 69 Migration Act, s 473BA. Edelman came to a stage unknown people started to phone me I couldn't even scared to answer the phone. INT: After 2009 the time...from time to time, on and off, they called...called me and asked me questions like what I'm doing, where I'm going and sort of things and they would ask help me, help me, they need to use my vehicle, and err, beaten many time and in this situation they err...to cause me fear that I wasn't able to, umm, move so...so freely that move around the country. Delegate: And just to clarify, what do you mean - beaten many times? INT: Explain the phrase 'they beat me many times' BNB17: Yes. Delegate: What do you mean by that INT: What are you trying to tell? BNB17: Nothing to tell ... [and elaborated upon questions asked by the authorities] Delegate: So I understand the type of questions one may be asked ... but I want to know specifically about what you mean by many times they were beating you? INT: ... But you are telling 'beat me several times'. Explain that. Why they beat you? How many time? The action 'beating'. BNB17: The beating. They beat and ask questions to get the truth. They beat and try to get information to make sure whether I know anything about LTTE. When they ask we tell. 'No. we don't have any connection. I tell 'I don't have anything to that manner'. INT: Their nature is, err, is...the nature is that they have to keep us always intimidated, intimidating and making fear and that sort of thing. Err, in this condition, err, umm, we may say anything about LTTE involvement, that's why they time to time...not a particular authority but ...a particular personnel but different personnel would involve this matter and would ask questions. Delegate: So what physically did they do in terms of...what do you mean when you use the word beating? INT: When you use the word 'beating'. What you mean by 'beating'? Edelman BNB17: No. Beating for no reason. Beat for nothing. Immediately after calling they beat. Because there is no reason. And we even don't know why he is beating us? INT: Sorry, um, he's trying to tell the reason why they are beating, but...err...but...err...your question is, err, what form of attack. Is it? Delegate: Um, yeah. I'll get you to, I'll get you to, um, translate and I'll seek to clarify with my next question. INT: Yep. Delegate: So he, did he restate that? Does anything need to be translate of what he has just said to me? INT: [inaudible] so I asked the question what he mean by the beating, he is finding the reason why they are beating. Delegate: Right, so is there anything...right OK. When you say, when you use the word that you were beaten, I would like to know what you mean by that. Not why someone might want to talk to you or harm you, but specifically what you mean by having been beaten. INT: When you tell 'they beat you' what you mean by 'beaten'? What is that? BNB17: What is beating means..... I didn't do an thing wrong. No wrong thing. Getting beaten was the issue for me. INT: I didn't do any wrong thing for them of for...the society or for the community, but, err, I was beaten by them when ever I go.. Delegate: OK, we'll talk about that later on, but right now my question is why did you not raise claims of being physically harmed from 2009 onwards in your written claims and you are now raising them today. I'm seeking to clarify that inconsistency. INT: Before 2009.ah. In the statements you gave during that period you didn't mention you were physically harmed. Now you are telling 'they beat me' what is that? BNB17: No. I mentioned. I did mention in that document. INT: I mentioned in the documents before. Edelman Delegate: Is there anything else you would like to put forward as to why that doesn't appear in your written claims? INT: Do you want to look at it, to see whether you have previously mentioned that or not? BNB17: I have mentioned. I have mentioned it in both times. All the problems happened to me. Including beating and all." BNB17 submitted that the group of interpretation errors revealed by this extract began with the misinterpretation during the interview by which the interpreter conveyed BNB17's evidence as saying that he had been "beaten many time". The later interpreter said that BNB17 had actually conveyed words to the effect of "they tortured me" and "they call me at anytime for their small jobs beat me". This was said to have led to the lengthy confusion. A further error was said to be that the delegate had asked BNB17 about his delay in raising his claim to have been beaten from 2009 onwards but the interpreter asked BNB17 why he had not mentioned being beaten in the period before 2009. Together, BNB17 submitted, these errors contributed to the finding by the Authority that BNB17 had fabricated his claims about being beaten. The interpretation errors alleged by DVO16 DVO16 applied for a protection visa on grounds which included persecution by the State of Iran on the basis of his ethnicity. At his interview with a delegate of the Minister, the following exchange occurred, as subsequently interpreted from the audio recording in evidence before the Federal Circuit Court: "Delegate: It also says here that you say that you will be persecuted for your ethnicity what do you mean by that? Interpreter: [Arabic] 'You say here that persecution has happened to you, I mean, that you've been persecuted for, what's it called, your belonging to your community.' DVO16: [Arabic] 'What? Huh? My tribe? My tribe?' Interpreter: Sometimes because he's Ahwazi, sometimes he doesn't understand my- I think my... Delegate: No, I think it means because you're an Arab. Interpreter: Yeah, because what happened, Arab, sometimes they use different expression. Delegate: Yeah Edelman Interpreter: [Arabic] 'She is saying that you, persecution has happened to you. You have been persecuted, in virtue of your belonging to the community you belong to.' DVO16: [Arabic] 'You mean how much "protecution" [i.e. strange hybrid of 'persecution' and 'protection'] I had from them?' Interpreter: He doesn't know the meaning of it, even in Arabic. DVO16: [Arabic] 'What does "persecution" mean?' Delegate: Well obviously you don't hold a fear of that then it if you don't know what it means. Interpreter: [Arabic] 'What it means is they treated you badly.' DVO16: [Arabic] 'My tribe?' Interpreter: [Arabic] 'Yes. Not your tr- the fact that you belong to the community you belong to.' DVO16: [Arabic] 'My tribe...' Interpreter: Sorry, he is, persecuted by which, Delegate: I think we will start again maybe. Interpreter: Just he wanted to know by which group. Delegate: It doesn't say. Interpreter: [Speaks in Arabic] 'It's not written here. It's not written.' Delegate: After that it talks about the Jalali tribe again, but — Interpreter: [Arabic] 'Afterwards they mentioned the Jalali, what's it called, tribe. Um, you being, um, you belong, no. And you were persecuted by - sorry - because you belong to the tribe you do, you were persecuted by this tribe, the Jalali.'" Edelman The errors in interpretation relied upon by DVO16, and accepted by the Full Court of the Federal Court70, were threefold. The first was that at the commencement of this extract, the delegate enquired about future persecution but the interpreter described this as past persecution by DVO16's community. The second alleged error in interpretation concerned the inadequate interpretation of the exchanges concerning persecution: inadequately conveying to DVO16 that he was being asked about his ethnicity as an Ahwazi Arab and inadequately conveying to the delegate that DVO16 was confused about questions concerning persecution by reason of his tribe (indeed, not interpreting some of DVO16's spoken words at all) and the meaning of the word "persecution". The third alleged error in interpretation concerned the failure to interpret for DVO16 the delegate's statement that "we will start again". The delegate refused DVO16's application for a protection visa. The Authority affirmed this decision. The Authority observed that DVO16 had responded to a question about what he meant by his claim that he would be persecuted due to his ethnicity by saying that he did not know. The Authority added that apart from tribal conflict and fearing harm from another tribe, DVO16 said that "he does not fear returning to Iran for any other reason" and did not claim to fear harm from the authorities on the basis of his ethnicity as an Ahwazi Arab. The Authority considered that although DVO16 is a member of an ethnic group that has been marginalised and discriminated against in Iran, he has the ability to obtain housing and employment. Ultimately, the Authority was not satisfied that DVO16 faced a real chance of serious harm on return to Iran. DVO16 accepted in this Court, as he had in the Federal Circuit Court and the Full Court of the Federal Court, that the alleged errors of interpretation were not known to the Authority nor were they the subject of any submission or material before the Authority. But he submitted that the errors in the interpretation of his interview nevertheless invalidated the decision of the Authority. DVO16 submitted that the errors in interpretation had effectively distracted him from giving substantial evidence about the type and extent of persecution that he had suffered and thus deflected him from putting his case. Interpretation errors and legal unreasonableness BNB17 submitted that in light of the alleged interpretation errors it was legally unreasonable for the Authority not to exercise its power under s 473DC to obtain new information either by obtaining a proper interpretation of the interview, or at least the relevant exchange, or by reinterviewing BNB17. Although the focus of BNB17's submissions was upon the second alleged error involving the group of misinterpretations, there is a further, related issue. This is whether such doubt 70 DVO16 v Minister for Immigration and Border Protection (2019) 271 FCR 342 at Edelman about the accuracy of the interpretation had been raised by the combination of all the errors that it was legally unreasonable for the Authority not to exercise its power under s 473DC. The principles concerning legal reasonableness in the exercise of the power under s 473DC were discussed in Minister for Home Affairs v DUA1671. Since the reasonableness condition upon the power in s 473DC is derived by implication from the statutory provision, its content is also shaped by the statutory context. That statutory context includes the expressed assumption that the Authority is a body that generally "does not hold hearings" and "is required to pursue the objective of providing a mechanism of limited review that is efficient, quick, free of bias and consistent with Division 3 (conduct of review)"72. The statutory context also includes the fact that the Authority's review task is not "de novo" in the literal ("from the beginning") and usual sense of that expression as a fresh review, "on the evidence presented at that hearing"73 and "regardless of error"74 in the decision of the delegate75. By contrast with the usual meaning of "de novo", the Authority is provided with the delegate's reasons for decision and must take the reasoning of the delegate into account in its consideration76. As Gordon J said very recently in ABT17 v Minister for Immigration and Border Protection77, when the Authority makes a demeanour finding it "is bound to accept [the] finding of the delegate" unless that finding is "glaringly improbable" or "some other sufficient reason" exists to set it aside. Consistently with these aspects of statutory context, where the Authority has serious doubts about the accuracy of significant parts of the interpretation as recorded during the interview with the delegate, the obligation upon the Authority (2020) 95 ALJR 54 at 61 [26]-[27]; 385 ALR 212 at 220. 72 Migration Act, s 473BA. 73 Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194 at 203 [13]. 74 Allesch v Maunz (2000) 203 CLR 172 at 180 [23]. 75 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 943-944 [59], 950-951 [85], 955 [113]; 383 ALR 407 at 423, 433, 439. But compare (2020) 94 ALJR 928 at 933 [5], 933 [8], 935 [16]; 383 ALR 407 at 409, 410, 412. 76 Migration Act, ss 473BB (definition of "review material"), 473CB(1)(a). (2020) 94 ALJR 928 at 952 [93]; 383 ALR 407 at 435. Edelman to exercise its power under s 473DC in a legally reasonable manner will generally require the Authority to obtain a fresh interpretation of the relevant parts of the interview rather than to reinterview the applicant. The latter might be the appropriate response if the hearing by the Authority were truly de novo and independent of the decision by the delegate. But in the context of a review that cannot be described as "de novo" in the ordinary sense, and which must be conducted with efficiency, speed, and usually without a hearing, the simplest response will usually be just to obtain a fresh interpretation of any significant and disputed part of a recorded interview contained in the review material. The legal unreasonableness ground of appeal relied upon by BNB17 must depend upon the concerns about errors in interpretation which were raised with the Authority by BNB17's representative rather than errors later alleged in evidence before the Federal Circuit Court. Whether the Authority acted with legal unreasonableness is to be judged at the time that the power was exercised or should have been exercised78. The focus is therefore upon the information about errors in interpretation that was before the Authority. Nevertheless, later interpretations are not irrelevant. They might provide a basis for responding to any submission by the Minister that the exercise of the power under s 473DC would not have had any material effect upon the decision. It may be that an exercise of the power to obtain a fresh interpretation of the part of the interview extracted above79 would involve the "simple route"80 of requesting an interpretation of a confined portion of the evidence given in the foreign language contained within no more than a few minutes of the audio recording. It may also be that submissions to the Authority concerning the inaccuracy of the interpretation of BNB17's interview as a whole have additional force in light of the very limited time that BNB17 had to obtain the interpretation and the fact that the fresh interpretation in this time period, obtained from an independent interpreter, reflected only "certain parts of the interview recording". Nevertheless, the three alleged errors of interpretation that were drawn to the Authority's attention were neither individually nor collectively sufficient for a conclusion that it was legally unreasonable for the Authority not to obtain a fresh interpretation of some or all of the interview. The first and third alleged errors in interpretation raised by BNB17 with the Authority, upon which BNB17 placed little reliance in submissions in this Court, 78 Minister for Home Affairs v DUA16 (2020) 95 ALJR 54 at 61 [26]; 385 ALR 212 at 80 Minister for Home Affairs v DUA16 (2020) 95 ALJR 54 at 62 [29]; 385 ALR 212 at Edelman involved imperfect interpretation but did not rise to the level of significance of interpretation error. As to the first alleged error, the interpretation "Army, CID, police or other people" captured the same essential meaning as "[t]he forces of the government – Army, CID, police". As to the third alleged error, the interpretation of BNB17's response as "sexual harassment" rather than "sexual assault" also captured the same essential meaning when viewed in the light of the entirety of the interpreted context: the words as interpreted were "[t]hey humiliated, like sexual harassment, folding my hand behind" and the "sexual harassment" was explained as involving "[h]olding back ... binding hand behind, and stripping off clothes, they would, ah, penetrate, with their, their ... body part ... or penis or something like that". No reasonable person could fail to comprehend from this interpretation that the reference to "sexual harassment" was to sexual assault. As to the second alleged error, BNB17 submitted to the Authority that the proper interpretation should have been: "They beat me because they want to find out, by inflicting pain, whether I am a member of the LTTE or supporting the LTTE". The interpretation at the interview was far from perfect: "the nature is that they have to keep us always intimidated, intimidating and making fear and that sort of thing. Err, in this condition, err, umm, we may say anything about LTTE involvement, that's why they time to time ...". The other matter in the group of misinterpretations to which BNB17 referred in his submissions to the Authority was the plainly erroneous interpretation of "from 2009" as "before 2009". But neither of these matters, including in combination with the first and third alleged errors, was sufficient to require the Authority to exercise its powers under s 473DC. the imperfect In the context of a lengthy exchange about BNB17 being beaten by the intimidation arising from interpretation about authorities, involvement in the LTTE conveyed a similar meaning to the later interpretation relied upon by BNB17. And the error of interpreting "from 2009" as "before 2009" would not reasonably have caused serious concern because shortly afterwards a similar question was asked in the interview, without any complaint concerning the interpretation. The delegate referred to BNB17's entry interview and his 2013 written claims and put to BNB17 "there is no mention to you being physically harmed or mistreated after 2009". The delegate then said "I give you the opportunity to comment on that now" and BNB17 took that opportunity. Interpretation errors and material to be given to the Authority In submissions which were broadly embraced by BNB17, DVO16 submitted that the requirement in s 473CB(1)(b) for the Secretary to give to the Authority "material provided by the referred applicant to the person making the decision before the decision was made" obliges the Secretary to give to the Authority any information provided by the applicant during an interview. DVO16 submitted that if oral interview remarks by DVO16 in Arabic constitute "information" given to the delegate then they must also constitute "material" Edelman required to be given to the Authority under s 473CB. Any substantial error in the interpretation of that information given by the applicant would, therefore, mean that the review material provided to the Authority was incomplete. The difficulty for this submission, however, lies in the contrast between the position of an applicant before a delegate of the Minister under Pt 2 and the position of an applicant before the Authority under Pt 7AA. Part 2 of the Migration Act requires the Minister, when considering whether to grant or to refuse to grant a non-citizen a visa, to "have regard to all of the information in the application"81 including "any additional relevant information" given by the applicant82. Although an oral interview is not required to be given83, the requirement for the Minister to consider additional relevant information includes information given by the applicant at an oral interview, and through the medium of an interpreter84. The need for the Minister to have regard to that information requires an "active intellectual process" of engagement with material information provided by the applicant85. In turn, this active intellectual process requires sufficiently accurate interpretation of the information given by the applicant. The more substantial the interpretation errors, and the more significant the misinterpreted information is to the applicant's claims, the more likely it will be that the interpretation errors will prevent the necessary active intellectual engagement with the applicant's information, thus amounting to jurisdictional error. Unlike Pt 2, there are no general requirements for engagement with "information" in Pt 7AA of the Migration Act. Part 7AA is not a de novo review in the sense that it does not require de novo engagement with information, including information provided by an applicant. Instead, it is a "limited"86 review of a delegate's "decision"87, which is conducted by "considering the review 81 Migration Act, s 54(1). 82 Migration Act, ss 54(2)(c), 55(1). 83 Migration Act, s 54(3). 84 See Migration Act, ss 56(2), 58(1)(d). 85 Singh v Minister for Immigration and Multicultural Affairs (2001) 109 FCR 152 at 86 Migration Act, s 473BA. 87 Migration Act, s 473CC(1). Edelman material provided"88. The review proceeds generally upon the materials that were before the delegate89. The general position is that new information is not to be requested or accepted by the Authority and the applicant is not to be interviewed90, and even if new information is requested by the Authority it can only consider the information in limited circumstances91. In short, the focus of Pt 7AA is almost exclusively upon "material", not upon "information". The submission on this issue by DVO16 would cut across the regime created in Pt 7AA. To reiterate, the regime in Pt 7AA involves a review of the delegate's decision based upon prescribed classes of material rather than a de novo review of information, including information that was considered by the delegate. As Anderson J correctly said92 of the requirement in s 473CB for the Secretary to give to the Authority various classes of material: "'material' refers to ... physical or electronic documents, objects and information. As such, the oral evidence itself provided by the appellant at the ... interview was not 'material' provided by the appellant to the delegate." For these reasons, DVO16's submission cannot be accepted. There may, however, be other ways in which interpretation errors at an interview might invalidate a review through their impact upon the material that is required to be provided to the Authority. One example concerns a different category of material that s 473CB(1)(a)(ii) requires the Secretary to give to the Authority: this material is a statement that refers to the "evidence on which [the delegate's] findings were based". The Secretary's duty to give this material to the Authority is a jurisdictional precondition for the Authority's duty to conduct its review "by considering the review material"93. Whether the statement of the Secretary is provided separately from the reasons of the delegate or whether the statement of the Secretary incorporates the reasons of the delegate, the "evidence" that must be referred to is the information provided by the applicant. The interpretation is not the "evidence". Thus, if the delegate's findings are based upon a substantial interpretation error concerning an 88 Migration Act, s 473DB. 89 Migration Act, s 473CB(1)(a), (b). 90 Migration Act, s 473DB(1). 91 Migration Act, s 473DD. See AUS17 v Minister for Immigration and Border Protection (2020) 94 ALJR 1007; 384 ALR 196. 92 BNB17 v Minister for Immigration and Border Protection [2020] FCA 304 at [95] (emphasis added). 93 Migration Act, s 473DB(1). Edelman applicant's evidence given during an interview then the statement of the Secretary might not reflect the evidence upon which the findings were based. Rather, the statement, like the reasons, will reflect only the erroneous interpretation on which the findings were based. If the erroneous interpretation concerns critical evidence this could result in failure of a jurisdictional condition. But it is unnecessary to explore this issue further since it was not raised and does not have any apparent application in these appeals, where the Secretary's statement has never been in issue. Interpretation errors and the basic requirement for "review" There remains for consideration the most extreme circumstance of the categories of error by an interpreter which might lead to jurisdictional error or failure of a jurisdictional condition: where the information provided by an applicant at an interview is so poorly interpreted that the gist of the applicant's case has not been conveyed. In the context of procedural fairness, it has been said that the right to a hearing "is a vain thing if the [applicant] is not understood"94. So too, the expression "review a fast track reviewable decision" in s 473CC includes the implication that the essence of the applicant's case will be considered when assessing the delegate's decision. On the assumption that this implication is not of the variety of implications said by members of this Court to have been proscribed if derived "through the application of the common law principle of statutory interpretation" relating to procedural fairness95, it was common ground that interpretation errors might be so extreme as to deprive the exercise of power by the Authority of its character as a "review" of the decision. Neither the interpretation errors in the BNB17 appeal nor the interpretation errors in the DVO16 appeal were of this fundamental nature. The interpretation errors in the BNB17 appeal have been addressed above in the context of the legal unreasonableness issue. As to the interpretation errors in the DVO16 appeal, senior counsel for DVO16 correctly described the effect of those errors as having deflected DVO16 from speaking further to his case of persecution on the ground of ethnicity. But the errors did not deprive him of the opportunity to put that case altogether, nor did they preclude the Authority from understanding the gist of his case. DVO16's interview focused upon the same incidents and allegations that he had raised in his written claim for protection. The Authority described those incidents and allegations and made findings in relation to them. The process is properly described as one of review of the delegate's decision. 94 Gonzales v Zurbrick (1930) 45 F 2d 934 at 937. 95 BVD17 v Minister for Immigration and Border Protection (2019) 93 ALJR 1091 at 1099 [33]; 373 ALR 196 at 204. Edelman Conclusion Each appeal must be dismissed with costs.
HIGH COURT OF AUSTRALIA APPELLANTS AND RESPONDENT Badenach v Calvert [2016] HCA 18 11 May 2016 ORDER Appeal allowed with costs. Set aside the orders of the Full Court of the Supreme Court of Tasmania made on 24 July 2015, and in their place order that the appeal be dismissed with costs. On appeal from the Supreme Court of Tasmania Representation J Ruskin QC with S B McElwaine SC for the appellants (instructed by Shaun McElwaine Barrister & Solicitor) K N Wilson QC with S S Monks for the respondent (instructed by Shine Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Badenach v Calvert Negligence – Duty of care – Scope of duty of care – Where solicitor received instructions from testator to prepare a will – Where entirety of testator's estate was to pass to respondent – Where testator's daughter brought successful proceedings under Testator's Family Maintenance Act 1912 (Tas) ("TFM Act") for provision out of testator's estate – Whether duty of care owed by solicitor to testator extended to advising testator of possible steps to avoid exposing testator's estate to a claim under TFM Act. Negligence – Duty of care – Existence of duty of care – Whether solicitor owed duty of care to intended beneficiary under testator's will – Whether Hill v Van Erp (1997) 188 CLR 159 applied – Whether interests of testator coincident with interests of intended beneficiary. Negligence – Causation – Whether, but for solicitor's failure to give advice, respondent would have received entirety of testator's estate – Whether relevant loss is a loss of chance. Words and phrases – "coincident", "duty of care", "interests of the intended beneficiary", "interests of the testator", "loss of a chance", "testamentary intention". Civil Liability Act 2002 (Tas), s 13(1)(a). Testator's Family Maintenance Act 1912 (Tas). FRENCH CJ, KIEFEL AND KEANE JJ. The first appellant ("the solicitor") is a legal practitioner and was at all material times a partner of the second appellant, a law firm. The solicitor received instructions from Mr Jeffrey Doddridge ("the client") to prepare his will, by which the entirety of his estate was to pass to the respondent, Mr Roger Calvert. The respondent was not the client's son, but was treated by him as such. The respondent's mother had been the client's de facto partner for many years until her death. The client's principal assets were two properties which he owned as a tenant in common in equal shares with the respondent. The client was 77 years old at the time he gave the instructions to draft the will described above, and he was terminally ill. He died later in the same year having executed a will drawn in accordance with his instructions. However, because of events which took place following the client's death, his testamentary intentions could not be carried into effect. The client had previously been married and there was a daughter of that marriage for whom he made no provision in his will. Following his death, his daughter brought proceedings under the Testator's Family Maintenance Act 1912 (Tas) ("the TFM Act") and was successful in obtaining a court order that provision be made for her out of the client's estate1. The combined effect of that order and a further order – that the parties' costs be paid out of the estate and taxed on a solicitor and client basis – was to substantially deplete what was not in any event a large estate. The respondent brought proceedings against the solicitor and the solicitor's firm in which the respondent claimed that the solicitor had been negligent in failing to advise the client of the possibility that his daughter might make a claim under the TFM Act and the options available to him to reduce or extinguish his estate so as to avoid such a claim. In particular, the respondent alleged that the solicitor failed to advise the client that he could avoid exposing his estate to a claim under the TFM Act either by converting his and the respondent's interests in the two properties to joint tenancies, so that those properties would pass to the respondent by survivorship, or by making inter vivos gifts to the respondent ("the inter vivos transactions"). The respondent alleged that these acts of negligence were breaches of the duty that the solicitor and the law firm owed to the respondent as the intended beneficiary of the client's estate. The solicitor did not give evidence in the proceedings. His file notes relating to the preparation of the will were tendered by consent. They simply 1 Doddridge v Badenach [2011] TASSC 34. recorded the client's instructions to prepare a will leaving the client's whole estate to the respondent if the respondent survived the client, or to the respondent's children in equal shares if the respondent predeceased the client. There was no evidence touching upon the question of what the client might have done had he been apprised of the possibility that a claim under the TFM Act might be made against his estate. There was no doubt that the solicitor could readily have ascertained the existence of the client's daughter. His firm had made two wills for the client in the past. The earlier of them contained a small legacy for the daughter. As the trial judge in the Supreme Court of Tasmania, Blow CJ, observed2, the solicitor could have looked at that will or simply asked the client whether he had any children. Blow CJ held3 that the solicitor owed the client a duty to enquire as to the existence of any family members who could make a claim under the TFM Act. His Honour inferred that had the solicitor done so, the client would have disclosed the existence of his daughter and the solicitor would have advised the client of the risk to his estate of successful proceedings being brought under the TFM Act. That might have led the client to make further enquiries about whether anything could be done to protect the respondent against that risk. In that event, the solicitor would have been obliged to advise about the possibility that the properties could be held by the client and the respondent as joint tenants. However, Blow CJ was not satisfied4, on balance, that the solicitor's advice about a possible claim under the TFM Act would have triggered an enquiry by the client about how to protect the respondent's position. In the absence of such an enquiry the solicitor was not under a duty to volunteer advice about creating joint tenancies. In these circumstances, his Honour did not consider5 that it was necessary to decide whether the solicitor owed the respondent, as intended beneficiary, any relevant duty. The Full Court of the Supreme Court of Tasmania (Tennent, Porter and Estcourt JJ) allowed6 the respondent's appeal. Their Honours did not consider 2 Calvert v Badenach (2014) 11 ASTLR 536 at 538-539 [5]; [2014] TASSC 61. 3 Calvert v Badenach (2014) 11 ASTLR 536 at 543 [25]. 4 Calvert v Badenach (2014) 11 ASTLR 536 at 543 [25]. 5 Calvert v Badenach (2014) 11 ASTLR 536 at 545-546 [33]. 6 Calvert v Badenach [2015] TASFC 8. that the solicitor's duty to the client was as limited as that postulated by Blow CJ. In their Honours' view7 it extended not only to a duty to enquire of the client whether he had any children, and to advise of the potential for a claim under the TFM Act and the impact such a claim might have upon his estate, but also to a duty to advise of the possible steps he could consider taking in order to avoid that impact occurring even if the client did not make any enquiry about those steps. The members of the Full Court reasoned that the duty owed by the solicitor to the respondent as intended beneficiary cannot be less than that owed to the client under the terms of his retainer8, or in tort9. The duty owed to the client was co-extensive with that owed to the respondent10. The Full Court also permitted11 the respondent to redefine the loss he claimed to have suffered as a result of the solicitor's breach of duty. The loss now claimed was the loss of the prospect that the client may have taken steps to protect the respondent's position. Porter J considered12 that that loss occurred when the client was not given the chance to consider what steps, if any, he would take in anticipation of a claim under the TFM Act. His Honour described it as "the loss of an opportunity to avoid a detriment", to which reference had been made in Sellars v Adelaide Petroleum NL13. In his Honour's view, there was a more than negligible chance that the client would have taken action to circumvent a possible claim under the 7 Calvert v Badenach [2015] TASFC 8 at [21] per Tennent J, [69]-[72] per Porter J, 8 Calvert v Badenach [2015] TASFC 8 at [22] per Tennent J. 9 Calvert v Badenach [2015] TASFC 8 at [117] per Estcourt J. 10 Calvert v Badenach [2015] TASFC 8 at [78] per Porter J, [117] per Estcourt J. 11 Calvert v Badenach [2015] TASFC 8 at [33]-[34] per Tennent J, [86], [97] per Porter J, [130], [140], [159] per Estcourt J. 12 Calvert v Badenach [2015] TASFC 8 at [93]. 13 (1994) 179 CLR 332 at 364; [1994] HCA 4. 14 Calvert v Badenach [2015] TASFC 8 at [95]. Estcourt J did not consider15 this to be a case where the loss of the opportunity was productive of damage. In his Honour's view this is a case where the loss of a chance is itself the damage. The respondent need only establish on the balance of probabilities that the chance – that is, that the client might have taken steps to protect the two properties from a claim under the TFM Act – existed. No more need be proved. The respondent's case for damages resulting from a breach of a duty owed to him by the solicitor was said to be based upon the decision of this Court in Hill v Van Erp16. It may immediately be observed that the loss claimed in that case was not the loss of an opportunity or a chance. Compensation was claimed for the loss of the property which would have been transferred to the intended beneficiary but for the negligence of the solicitor acting for the testatrix17. What the beneficiary lost was no mere expectation, but rather a share in the testatrix's estate18. The solicitor, Mrs Hill, had in accordance with her client's ("the testatrix") instructions, prepared a will by which the testatrix's house property and contents were to be given to her son and to her friend Mrs Van Erp as tenants in common in equal shares. Mrs Van Erp was also to be given certain other items of personal property. However, when the will came to be signed and witnessed, the solicitor asked Mrs Van Erp's husband to sign as the second attesting witness. The consequence of this was that the disposition of property to Mrs Van Erp was rendered void by reason of s 15(1) of the Succession Act 1981 (Q). A similar default had given rise to liability in Ross v Caunters19. There could be no doubt that a solicitor owes a duty to his or her client in both contract and tort. The scope of a solicitor's duties with respect to the latter will usually be set by the terms of the retainer20. The question in Hill v Van Erp 15 Calvert v Badenach [2015] TASFC 8 at [134], [141]. 16 (1997) 188 CLR 159; [1997] HCA 9. 17 Hill v Van Erp (1997) 188 CLR 159 at 170 per Brennan CJ. 18 Hill v Van Erp (1997) 188 CLR 159 at 179 per Dawson J. 20 Hawkins v Clayton (1988) 164 CLR 539 at 544-545; [1988] HCA 15. was whether a duty in tort could also be said to be owed to an intended beneficiary. The majority decision was not based upon the solicitor having assumed a particular responsibility21 to the intended beneficiary. Three members of the majority expressly disavowed its relevance22 and two placed only some reliance on it23. It must be conceded, as the appellants point out in the present proceedings, that the approaches taken by members of the majority to the question of whether a duty existed differed in some respects. Nevertheless it may be seen from most of the judgments that the duty found to be owed by the solicitor to Mrs Van Erp as the intended beneficiary had its source in the solicitor's obligations arising from the retainer between the solicitor and her client24. The solicitor was obliged to exercise care and skill in giving effect to her client's testamentary intentions. The interests of the testatrix and the intended beneficiary in those intentions being carried into effect were relevantly the same. Recognising a duty to the intended beneficiary would not involve any conflict with the duties owed by the solicitor to her client, the testatrix. In White v Jones25, Lord Goff of Chieveley said that the general rule that a solicitor owes a duty of care only to his or her client may be thought to present something of an obstacle to a remedy being provided to an intended beneficiary. The scope of the solicitor's duties will be set by the terms of the retainer with the client. The solicitor would be entitled to invoke that contract in defence of, or to limit, any claim by a disappointed beneficiary26. In Hill v Van Erp, Brennan CJ explained27 that a solicitor's duty is generally considered to be owed solely to the client because the duty is to 21 As considered in Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465. 22 Hill v Van Erp (1997) 188 CLR 159 at 171 per Brennan CJ, 198 per Gaudron J, 23 Hill v Van Erp (1997) 188 CLR 159 at 184-185 per Dawson J, 190 per Toohey J. 24 Hill v Van Erp (1997) 188 CLR 159 at 167-168, 181-182, 187-188, 190, 234. 25 [1995] 2 AC 207 at 256-257. 26 White v Jones [1995] 2 AC 207 at 261. 27 Hill v Van Erp (1997) 188 CLR 159 at 167. exercise professional knowledge and skill in the protection and advancement of the client's interests in the transaction in which the solicitor is retained. That duty cannot be compromised by a duty to a person whose interests are not coincident with those of the client, but in the case of a testator and an intended beneficiary under the testator's will the interests are coincident. So understood, the duty said to be owed by the solicitor to an intended beneficiary is something of an exception to the general rule. Nevertheless, in a practical sense it operates consistently with the duty to the client. Dawson J (with whom Toohey J agreed) also regarded28 those interests as relevantly the same. Since serving the interests of the intended beneficiary involved no conflict with the performance of the contract as between the solicitor and client29, there was no reason in principle why the relationship between the solicitor and the intended beneficiary could not give rise to a duty by the solicitor towards the beneficiary30. Three members of the majority in Hill v Van Erp identified the contractual obligation undertaken by the solicitor to carry out the client's instructions as important to the existence of a duty of care to the intended beneficiary. Brennan CJ31 and Gummow J32 identified the very purpose of the engagement of, and the instructions given to, the solicitor as being to ensure that the intended beneficiary's economic interests were advanced by the receipt of the intended benefit. Gaudron J33 and Gummow J34 pointed to the position of control in which the solicitor was placed over realising the testamentary intentions of the testatrix, by reason of the testatrix's instructions, as a significant factor supporting the duty of care in question. A contractual relationship may create the occasion for and give rise to a tortious duty of care owed by one contracting party to the other and/or to a third 28 Hill v Van Erp (1997) 188 CLR 159 at 185, 188. 29 Hill v Van Erp (1997) 188 CLR 159 at 187. See also at 236 per Gummow J. 30 Hill v Van Erp (1997) 188 CLR 159 at 182. 31 Hill v Van Erp (1997) 188 CLR 159 at 167. 32 Hill v Van Erp (1997) 188 CLR 159 at 234. 33 Hill v Van Erp (1997) 188 CLR 159 at 198. 34 Hill v Van Erp (1997) 188 CLR 159 at 234. party. There are myriad examples across a variety of contractual relationships and it is not necessary to enumerate them here. The existence of a duty of care may be derived from the application of general principles to particular cases albeit the expression and application of those principles may evolve over time. A factor supporting such an application in favour of a third party may be that it serves the purpose of coherence in the law. Gummow J made that point in Hill v Van Erp in observing that35: "[A] coherent law of obligations ought not to leave ineffectual, in a practical sense, the undoubted responsibility … of the solicitor to the client." Specifically referring to Hawkins v Clayton36, his Honour pointed out that the application of a duty of care in that case to solicitors with custody of a will assisted realisation of the intention of the testatrix in making the will and the expectation of those whom the testatrix intended to receive her estate37. The recognition and enforcement by equity of a trust for the benefit of a contractual promise in favour of a third party discussed in Trident General Insurance Co Ltd v McNiece Bros Pty Ltd38 was offered as an analogous example39. The duty to the client in this case Before comparing the duty, the status of the respondent and the interests of the client and the respondent with those in Hill v Van Erp, it is necessary to consider the factual foundation for the respondent's case and the duty to which it is said it gives rise. It is necessary to bear in mind that the respondent's case is one of a failure to advise the client. As previously mentioned, the respondent contends that the solicitor had a duty to advise the client that he could avoid exposing his estate to a claim under the TFM Act by undertaking the inter vivos transactions. Regard must therefore be had not to what in fact occurred, but rather to what should have occurred. In order to determine whether the duty to advise the client in the terms 35 Hill v Van Erp (1997) 188 CLR 159 at 224. 36 (1988) 164 CLR 539. 37 Hill v Van Erp (1997) 188 CLR 159 at 232. 38 (1988) 165 CLR 107; [1988] HCA 44. 39 Hill v Van Erp (1997) 188 CLR 159 at 224. contended for arose, it is necessary to consider the events which would have taken place had the solicitor exercised the requisite professional skill and care. On receiving the original instructions the solicitor would have observed that no provision had been made for any family member. Prudence would have dictated an enquiry about the client's family. That enquiry would have yielded information as to the existence of the daughter. It is not disputed that the solicitor would then have been obliged to advise the client that it was possible that a claim might be brought by her against the client's estate under the TFM Act. What is at issue on this appeal is whether more was required. It would appear that the client was unlikely to have been able to provide the solicitor with information concerning the personal circumstances of his daughter. He had not had any contact with her (save for one chance encounter) since separating from her mother in 197340. In these circumstances the solicitor would be obliged to inform the client that, absent further enquiries (with associated expense and delay), the solicitor could not provide advice as to whether the daughter would qualify under the TFM Act for provision out of the client's estate. The solicitor would further advise that it could not be known whether the daughter would in fact make a claim. Not all persons who are entitled to bring legal proceedings of this kind choose to do so. The solicitor would then identify the options which would appear to be available to the client. The client could have further enquiries made concerning his daughter's circumstances, in order to assess the risk that she might make a claim and the extent to which she might be successful. He could have made provision for her in his will without that further information. He could have done nothing with regard to the daughter, maintained his original instructions, and allowed events to take their course after his death. The circumstance that it was in the respondent's interest to urge the client not to take some of these options is a significant factual difference between this case and Hill v Van Erp. The duty which the solicitor is fulfilling by advising the client as to his options arises from his original retainer. It is a duty to ensure that the client gives consideration to the claims that might be made upon his estate before giving final instructions as to his testamentary dispositions. Whilst advice about the possibility of a claim against his estate is clearly relevant in the context of the retainer, advice about how to avoid such a claim by inter vivos transactions with property interests is not. From the solicitor's 40 Doddridge v Badenach [2011] TASSC 34 at [2]. perspective it could not be assumed that the client would need this latter advice. The respondent's case, understandably, is not put on the basis that the client, on hearing that a claim by the daughter was a mere possibility, would have instructed the solicitor that he wished to take all lawful steps to defeat such a claim. Such an approach is understandable because there is no way of knowing what the client's instructions would have been. The respondent's case is that the solicitor should have volunteered this advice. However, it is difficult to see how the solicitor had a duty to do so merely because the solicitor has informed the client of the possibility that a claim could be made by the daughter but that, absent further information, he could not be any more certain about it occurring. It cannot be reasoned from the fact that the daughter later brought a claim that the solicitor should have appreciated that this was likely to occur. Even if he had done so, it is still difficult to see that the appreciation of this possibility would have warranted advice of this kind. Neither the solicitor nor the client could have known with any certainty whether the claim would be successful and, if so, the extent of the provision that might be made for the daughter from the client's estate. The client's initial instructions regarding the preparation of his will, to benefit the respondent alone, would not have been sufficient to convey to the solicitor that the client would wish to take any lawful step to defeat any claim which was made by the daughter. At this point the solicitor was not to know what view the client might take of whether the daughter had a claim, moral or legal, upon him or his estate. This was the very question which the solicitor's advice would have raised for his consideration. Causation The respondent's case faces another hurdle. Even if it be accepted that the solicitor came under a duty to advise the client in the terms alleged, it cannot be concluded, on the balance of probabilities, what course of action the client would then have taken. In addition to the choices available to the client, there would have been other matters put to the client for his consideration including the risks concerning the irreversible nature of the inter vivos transactions, and the associated cost and delay. Given these considerations, and the uncertainty that the daughter would make a claim, there is no reason to think that even if the client had been given the advice contended for, he would have been more likely to undertake transactions of this kind than, say, simply pursuing his original course of action, by which the respondent was to be the sole beneficiary under the client's will. But of course had that occurred, and the daughter later made a claim, it could not be said that the solicitor had caused the respondent loss. Section 13(1)(a) of the Civil Liability Act 2002 (Tas) contains a requirement of factual causation. As with other statutory tests of this kind, it requires the application of a "but for" test of causation41. The respondent must prove, on the balance of probabilities, that but for the solicitor's failure to give the advice contended for, the respondent would have received the client's estate. The respondent has not discharged this onus of proof. The respondent seeks to overcome problems of proof by redefining the loss occasioned by the alleged breach of duty as the loss of the chance that the client may have undertaken the inter vivos transactions. The chance could not be of a better testamentary disposition; none is identified as available. It has been explained that to speak of loss as the loss of a "chance" distorts the question of causation42. It involves the application of a lesser standard of proof than is required by the law43 and, it follows, by s 13(1)(a). It confuses the issue of the loss caused with the issue of assessing damages which are said to flow from that loss. In that assessment a chance may be evaluated. The respondent's case on causation is not improved by seeking to equate the chance spoken of with an opportunity lost. It may be accepted that an opportunity which is lost may be compensable in tort44. But that is because the opportunity is itself of some value. An opportunity will be of value where there is a substantial, and not a merely speculative, prospect that a benefit will be acquired or a detriment avoided45. It remains necessary to prove, to the usual standard, that there was a substantial prospect of a beneficial outcome46. This requires evidence of what would have been done if the opportunity had been afforded. The respondent has not established that there is a substantial prospect that the client would have 41 Wallace v Kam (2013) 250 CLR 375 at 383 [16]; [2013] HCA 19. 42 Tabet v Gett (2010) 240 CLR 537 at 586 [142]; [2010] HCA 12. 43 Tabet v Gett (2010) 240 CLR 537 at 562 [58], 564 [69], 575 [101], 587-589 [143]- 44 Sellars v Adelaide Petroleum NL (1994) 179 CLR 332. 45 Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 364. 46 Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 355, 367-368. chosen to undertake the inter vivos transactions. Therefore, the respondent has not proven that there was any loss of a valuable opportunity. The onus of proving causation of loss is not discharged by a finding that there was more than a negligible chance that the outcome would be favourable, or even by a finding that there was a substantial chance of such an outcome. The onus is only discharged where a plaintiff can prove that it was more probable than not that they would have received a valuable opportunity. To the extent that the majority in Allied Maples Group Ltd v Simmons & Simmons47 holds that proof of a substantial chance of a beneficial outcome is sufficient on the issue of causation of loss, as distinct from the assessment of damages, it is not consistent with authority in Australia and is contrary to the requirements of s 13(1)(a) of the Civil Liability Act. Hill v Van Erp does not apply Whatever be the position with respect to the duty which was owed to the client, it could not be one which extended to the respondent by analogy with Hill The duty recognised in Hill v Van Erp arose in circumstances where the interests of the testatrix and the intended beneficiary were aligned and where final testamentary instructions had been given to the solicitor. The solicitor's obligation was limited and well defined. This case might, at least on a first impression, be thought to bear some similarity to Hill v Van Erp. The client's initial instructions disclosed an intention that the respondent receive the client's property interests under his will. The respondent has the status of an intended beneficiary. But there the similarity ends. The duty for which the respondent contends is not the same as the more limited duty which was recognised in Hill v Van Erp, to give effect to a testamentary intention. It is one, more generally, to give advice as to the client's property interests and future estate. The duty for which the respondent contends cannot be said to be owed to the respondent as an intended beneficiary. That is apparent from the nature of the advices and the point at which they should have been given. The advices which the respondent says should have been given in discharge of that duty 47 [1995] 1 WLR 1602; [1995] 4 All ER 907. would have rendered it unnecessary for the client to name the respondent as a beneficiary in his will. The interests of the client and the respondent as parties to the proposed inter vivos transactions are not the same as those of a testator and intended beneficiary with respect to the execution of final testamentary intentions. The advices and warnings which the solicitor would need to give about such transactions would reflect that their interests are not coincident. For instance, at any point prior to completion of the creation of the joint tenancies or the gift, the client could change his mind despite any promise having been made to the respondent. This is not a circumstance which could arise where a solicitor was merely carrying into effect a testator's intentions as stated in his or her final will. Nor could there be any question of the solicitor advising the respondent about all the matters relevant to his interests, such as the risk inherent in a joint tenancy of predeceasing the client. The solicitor's duty is one protective of the client and his interests alone. So understood, the duty owed by the solicitor to the client is not different from that to which Brennan CJ referred in Hill v Van Erp. It is the duty generally understood to be owed by a solicitor solely to his or her client. Hill v Van Erp recognised circumstances in which the duty of care to a third party could and did arise. The circumstances which supported the existence of that duty of care are not present in this case. Conclusion and orders The appeal should be allowed with costs and the orders of the Full Court set aside. In lieu thereof it should be ordered that the appeal from the decision of Blow CJ be dismissed with costs. The facts and procedural history are within a narrow compass. It is convenient to focus immediately on their most salient features. Mr Doddridge, the Testator, did not retain Mr Badenach, the Solicitor, to give general estate planning advice. The Testator retained the Solicitor specifically to prepare a will giving the whole of his estate to Mr Calvert. The Solicitor in fact prepared a will, and the will he prepared was effective in law to do just that: to give the whole of the Testator's estate to Mr Calvert. For preparing the will, the Solicitor charged the Testator the appropriately modest sum of $440. When taking instructions from the Testator for the preparation of the will, the Solicitor did not ask whether the Testator had family and, not learning from asking that question that the Testator had a daughter, did not warn the Testator of the risk that his daughter might make a statutory claim for maintenance against his estate. The primary judge held that those omissions amounted to a breach of the duty of care which the Solicitor owed in contract and in tort to the Testator in the performance of the retainer to prepare the will. The primary judge held that neither of those omissions amounted to a breach of the duty of care which the Solicitor owed in tort to Mr Calvert as the Testator's intended beneficiary. The Full Court disagreed. The Full Court held that the Solicitor breached the duty of care which the Solicitor owed to the Testator not only by omitting to warn the Testator of the risk that his daughter might make a statutory claim for maintenance against the estate but also by omitting to go on to advise the Testator that he could transfer some or all of his property during his lifetime so as to avoid exposing his estate to such a claim. Those same omissions, the Full Court held, also breached the duty of care which the Solicitor owed to Mr Calvert. Mr Calvert's compensable damage, according to the Full Court, was his loss of the chance that the Testator (properly advised) might have chosen to transfer some or all of his property during his lifetime in order to avoid exposing his estate to the statutory claim for maintenance which (as events transpired) his daughter did end up making after his death. Together with other members of this Court, I would allow the appeal from the judgment of the Full Court and would make consequential orders having the effect of reinstating the primary judge's dismissal of Mr Calvert's action in tort. The central flaw in the reasoning of the Full Court, in my opinion, was to treat the scope of the duty of care which the Solicitor owed to Mr Calvert as co- extensive with the scope of the duty of care which the Solicitor owed to the Testator. The scope of the Solicitor's undoubted duty of care to Mr Calvert was certainly encompassed within the scope of the duty of care which the Solicitor owed to the Testator. In a critical respect, however, it was narrower. Subject to statutory or contractual exclusion, modification or expansion, the duty of care which a solicitor owes to a client is a comprehensive duty which arises in contract by force of the retainer and in tort by virtue of entering into the performance of the retainer48. The duty is to exercise that degree of care and skill to be expected of a member of the profession having expertise appropriate to the undertaking of the function specified in the retainer49. Performance of that duty might well require the solicitor not only to undertake the precise function specified in the retainer but to provide the client with advice on appurtenant legal risks50. Whether or not performance of that duty might require the solicitor to take some further action for the protection of the client's interests beyond the function specified in the retainer is a question on which differences of view have emerged51. That question was not addressed in argument, and need not be determined in this appeal. The duty of care which a solicitor who is retained to prepare a will owes to a person whom the testator intends to be a beneficiary is more narrowly sourced and more narrowly confined. The duty arises solely in tort by virtue of specific action that is required of the solicitor in performing the retainer52. The duty plainly cannot extend to requiring the solicitor to take reasonable care for future and contingent interests of every prospective beneficiary when undertaking every action that might be expected of a solicitor in the performance of the solicitor's duty to the testator. If the tortious duty of care were to extend that far, it would have the potential to get in the way of performance of the solicitor's contractual duty to the testator. Extended to multiple prospective beneficiaries, it would be crippling. The solicitor's duty of care is instead limited to a person whom the testator actually intends to benefit from the will and is confined to requiring the solicitor to take reasonable care to benefit that person in the manner and to the extent 48 Cf Astley v Austrust Ltd (1999) 197 CLR 1 at 22-23 [47]-[48]; [1999] HCA 6; Voli v Inglewood Shire Council (1963) 110 CLR 74 at 84-85; [1963] HCA 15. 49 Heydon v NRMA Ltd (2000) 51 NSWLR 1 at 53-54 [147], 117 [362]; Rogers v Whitaker (1992) 175 CLR 479 at 483; [1992] HCA 58. 50 Heydon v NRMA Ltd (2000) 51 NSWLR 1 at 53-54 [147]; Rogers v Whitaker (1992) 175 CLR 479 at 483. 51 Eg Hawkins v Clayton (1988) 164 CLR 539 at 544-545, 579-580; [1988] HCA 15; Kowalczuk v Accom Finance Pty Ltd (2008) 77 NSWLR 205 at 263-270 [267]- [294]; Doolan v Renkon Pty Ltd (2011) 21 Tas R 156 at 166-168 [30]-[39]; Takla v Nasr [2013] NSWCA 435 at [68]. 52 Hill v Van Erp (1997) 188 CLR 159 at 167, 182-183, 185, 234; [1997] HCA 9. identified in the testator's instructions. The testator's instructions are critical. The existence of those instructions compels the solicitor to act for the benefit of the intended beneficiary to the extent necessary to give effect to them. The instructions define the intended benefit, absence of which constitutes the damage which is the gist of the cause of action in negligence53. The instructions expose the intended beneficiary to carelessness on the part of the solicitor in giving effect to those instructions against which the intended beneficiary cannot protect. The instructions thereby give rise to a position of vulnerability on the part of the intended beneficiary of a kind which has been recognised to be ordinarily necessary to justify the imposition of tortious liability for damage comprised of purely economic loss54. Confined to taking reasonable care to benefit the intended beneficiary in the manner and to the extent identified in the testator's instructions, the solicitor's tortious duty to that beneficiary is coherent with the solicitor's contractual and tortious duty to the client, thereby allowing the two to co-exist55. The duty is coherent because it admits of no possibility of conflict: the interests of the client and the interests of the beneficiary necessarily coincide completely56. Those are the multiple interlocking considerations which underlie the operative statement of principle by Brennan CJ in Hill v Van Erp, a case in which the negligent omission of the solicitor was to ensure that the will was properly executed57: "There is no reason to refrain from imposing on a solicitor who is contractually bound to the testator to perform with reasonable care the work for which he has been retained a duty of care in tort to those who may foreseeably be damaged by carelessness in performing the work. The terms of the retainer determine the work to be done by the solicitor and the scope of the duty in tort as well as in contract. A breach of the retainer by failing to use reasonable care in carrying the client's instructions into effect is also a breach of the solicitor's duty to an intended beneficiary who thereby suffers foreseeable loss." 53 Hill v Van Erp (1997) 188 CLR 159 at 167-168, 197. 54 Cf Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515 at 530-531 [23]; [2004] HCA 16. 55 Cf Sullivan v Moody (2001) 207 CLR 562 at 579-580 [50], 582 [60]; [2001] HCA 56 Hill v Van Erp (1997) 188 CLR 159 at 167, 185, 187. 57 Hill v Van Erp (1997) 188 CLR 159 at 167-168. Taking reasonable care in carrying the testator's instructions into effect might on occasions require a solicitor retained to prepare a will to do more than merely draft and ensure the proper execution of that will. An example is where taking steps to sever a joint tenancy is integral to carrying into effect a testator's intention that specified property be given by the will such that the taking of those steps can properly be seen to form part of the will-making process58. Unless there is some further factor affecting the relationship of the parties, however, a solicitor retained to prepare a will can have no duty to a person whom the testator intends to benefit other than to act in the manner and to the extent identified in the testator's instructions. That is because, outside the scope of the testator's instructions: there can be no requirement for the solicitor to act for the benefit of the person; there can be no damage to the person if the solicitor fails to act for that person's benefit; there can be no relevant vulnerability on the part of the person to the action or inaction of the solicitor; and there can be no necessary coincidence between the person's interests and those of the client. Where the testator's instructions stop, so does the solicitor's duty of care to the intended beneficiary. Confinement of the solicitor's tortious duty to an intended beneficiary to the taking of reasonable care in carrying the client's instructions into effect admits of the possibility that the solicitor may act carelessly in relation to the testator and yet incur no liability to any beneficiary. That possibility does not lead to the moral dilemma and systemic embarrassment of a scenario in which "[t]he only person who has a valid claim has suffered no loss, and the only person who has suffered a loss has no valid claim"59. Beyond the scope of the instructions which identify the manner in which and extent to which the testator intends to benefit a person, that person suffers no relevant loss at the hands of the careless solicitor. The confinement of the solicitor's duty to the intended beneficiary therefore does not run counter to the "impulse to do practical justice" which historically drove its recognition60. Having been retained by the Testator specifically to prepare a will giving the whole of his estate to Mr Calvert, the Solicitor came under a duty of care to Mr Calvert to ensure that Mr Calvert was given a legally effective testamentary gift of the Testator's estate. That was all, because that was all that was relevantly required of the Solicitor in order to carry out the Testator's instructions. 58 Eg Vagg v McPhee (2013) 85 NSWLR 154 at 159 [20]; Smeaton v Pattison [2002] QSC 431; Carr-Glynn v Frearsons (a firm) [1999] Ch 326 at 335-336. 59 Ross v Caunters [1980] Ch 297 at 303. 60 Cf Gartside v Sheffield, Young & Ellis [1983] NZLR 37 at 43; White v Jones [1995] 2 AC 207 at 259, 262, 268; Hill v Van Erp (1997) 188 CLR 159 at 168. That is not to say that the Solicitor's duty of care to the Testator may not have been wider. There is in that respect no difficulty in the conclusion of the primary judge that the exercise of that degree of care and skill to be expected of a solicitor undertaking the function of preparing the Testator's will required the Solicitor to ask the Testator whether he had family and, on learning from asking that question that he had a daughter, to warn the Testator of the risk that his daughter might make a statutory claim against his estate. The conclusion was founded on expert evidence of an experienced solicitor, which the primary judge accepted. There is more difficulty in the conclusion of the Full Court that the exercise of the same degree of care and skill extended so far as to require the Solicitor to advise the Testator that he could transfer some or all of his property during his lifetime so as to avoid exposing his estate to such a claim. That seems a lot to expect for the price of a will, and the expert evidence accepted by the primary judge did not go that far. The correctness of that further conclusion of the Full Court does not need to be determined. Even if they constituted breaches of the duty of care which the Solicitor owed to the Testator, the omissions of the Solicitor add nothing of themselves to the claim made against the Solicitor by Mr Calvert. The omission of the Solicitor to warn the Testator of the risk that his daughter might make a statutory claim, and to advise him that he could transfer some or all of his property during his lifetime so as to avoid exposure to such a claim, did not constitute omissions on the part of the Solicitor to take steps which were integral to carrying into effect the Testator's instructions that his estate be given by the will to Mr Calvert. The omissions were not from action which formed part of what was required of the Solicitor to effect the testamentary transmission of the estate to Mr Calvert. Whether or not they fell within the scope of the duty of care which the Solicitor owed to the Testator, they were not within the scope of the duty of care which the Solicitor owed to Mr Calvert. In the absence of further instructions from the Testator, which would necessarily have expanded the scope of the retainer, I do not think it possible to conclude that there was any omission of the Solicitor within the scope of the duty of care which the Solicitor owed to Mr Calvert. The impossibility does not lie in the absence of evidence sufficient to form a conclusion of fact about the content of any instructions the Testator would have given had the Solicitor advised him of the relevant risk to his estate and of the options available to him to avoid that risk. The impossibility lies in the absence of instructions from the Testator requiring the Solicitor to take some further action for the benefit of Mr Calvert beyond the drafting and execution of the will. The problem for Mr Calvert is not a difficulty of establishing a causal link between a breach of a duty of care and damage. His claim does not get to that point. The problem is at an anterior stage in the analysis. It stems from the absence of a fact necessary to establish a duty of care of the requisite scope and to give rise to the existence of damage: an expansion in the scope of the Testator's instructions – a new or enlarged retainer. For these reasons, I agree with the orders proposed by French CJ, Kiefel GORDON J. The first appellant, a solicitor and a partner of the second appellant, was retained by Jeffrey Doddridge ("the testator") to draw a will under which the entirety of his estate was to pass to the respondent, Mr Roger Calvert ("Mr Calvert"). A will was drawn and executed in accordance with the testator's instructions. Following the testator's death, his daughter from a previous relationship filed an application pursuant to the Testator's Family Maintenance Act 1912 (Tas) ("the TFM Act"). No provision had been made for his daughter in the testator's will. Mr Calvert was a respondent in that proceeding. The daughter's Mr Calvert sued the appellants in negligence. The questions to be determined in this appeal are as follows. Did the appellants owe a duty of care to Mr Calvert? If so, what was the duty and was it breached? And if a relevant duty was breached, did Mr Calvert suffer loss that was caused by that breach? The appellants owed a duty of care to the testator to use reasonable care in the preparation of his will. The appellants breached that duty. However, the appellants did not owe and could not have owed a duty of care to Mr Calvert because, at the relevant time, it cannot be said that the interests of the testator and Mr Calvert were the same, consistent or coincident. As the appellants did not owe any duty of care to Mr Calvert, there could be no breach. Even if a duty was owed to Mr Calvert and that duty had been breached, Mr Calvert failed to adduce any evidence, let alone persuasive evidence, that was sufficient to establish what the testator would have done if the appellants had not breached the duty that they owed. Mr Calvert did not prove that it was more probable than not that, had the appellants discharged their duty of care, he would have received the entirety (or at least a greater portion than he did) of the testator's estate. The appeal must be allowed with costs. The facts of the matter are set out in the reasons of other members of the Court and need not be repeated except to the extent necessary to explain my reasons. Duty of care owed to the testator – scope and content Before considering the scope and content of any duty owed by the appellants to Mr Calvert, it is necessary to consider the scope and content of the duty owed by the appellants to the testator. 61 Doddridge v Badenach [2011] TASSC 34. When formulating a duty of care, its scope and its content "must neither be so broad as to be devoid of meaningful content, nor so narrow as to obscure the issues required for consideration"62. Moreover, the scope of the duty of care is not to be determined retrospectively by looking at questions of breach of duty – that is, by asking first what could have been done to prevent the loss or damage63. They are separate inquiries, which must not be conflated64. Contrary to Mr Calvert's contention, the duty owed by the appellants to the testator was not a duty to advise the testator that he could avoid exposing his estate to a claim under the TFM Act by taking precise steps. That formulation of the duty was "framed by reference to the particular breach that was alleged and thus by reference to the course of the events that had happened. Because the breach assigned was not framed prospectively the duty, too, was framed retrospectively, by too specific reference to what had happened"65. The terms of the solicitor's retainer determine the work to be done and therefore the scope and content of the duty in contract and in tort66. Where a solicitor accepts a retainer to prepare a will, the solicitor owes a duty of care to the client to use reasonable care in the preparation of his or her will67. The appellants owed a duty of care to the testator to use reasonable care in the preparation of the will. It is then necessary to turn to the separate question of whether, in the circumstances of this case, the appellants owed the same duty to Mr Calvert. 62 Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361 at 371 [20]-[21]; [2011] HCA 11 (footnote omitted). 63 Kuhl (2011) 243 CLR 361 at 370 [19]. 64 CAL No 14 Pty Ltd v Motor Accidents Insurance Board (2009) 239 CLR 390 at 418 [68]; [2009] HCA 47. 65 CAL No 14 Pty Ltd (2009) 239 CLR 390 at 418 [68]. 66 See Hawkins v Clayton (1988) 164 CLR 539; [1988] HCA 15; Hill v Van Erp (1997) 188 CLR 159 at 167, 172-173, 181, 210, 232; [1997] HCA 9; Astley v Austrust Ltd (1999) 197 CLR 1 at 20-23 [44]-[48]; [1999] HCA 6. 67 Hill v Van Erp (1997) 188 CLR 159 at 167; Kuhl (2011) 243 CLR 361 at 371 [22]. Duty of care owed to Mr Calvert? The duty of care owed by a solicitor to a testator in tort may extend to an intended beneficiary68. Such an extension is an exception to the general rule that a solicitor owes a duty only to his or her client. If the duty does so extend, its scope and content remain the same as for the client. As Brennan CJ stated in "Most testators seek the assistance of a solicitor to make their intentions effective. The very purpose of a testator's retaining of a solicitor is to ensure that the testator's instructions to make a testamentary gift to a beneficiary results in the beneficiary's taking that gift on the death of the testator. There is no reason to refrain from imposing on a solicitor who is contractually bound to the testator to perform with reasonable care the work for which he has been retained a duty of care in tort to those who may foreseeably be damaged by carelessness in performing the work. The terms of the retainer determine the work to be done by the solicitor and the scope of the duty in tort as well as in contract." However, Hill v Van Erp is not authority for the proposition that a solicitor instructed to prepare a will always owes a duty of care to an intended beneficiary. The facts of that case were particular, and the duty of care to the intended beneficiary found to exist was limited. In that case, a will was properly drawn but, in executing the will, the relevant formalities were not complied with. The negligence arose on the execution of the will. Importantly, at the time of the breach of duty in Hill v Van Erp, the testator's wishes had been expressed and reflected in the will. All that remained to be done was to give effect to those wishes by proper execution of the will. A majority of the Court held that, in those circumstances, the solicitor owed a duty of care to the third party, being an "intended beneficiary" of the will. Critically, the majority considered it important that the interests of the testator and the third party were the same, consistent or coincident70. They were the same, consistent or coincident because the client's testamentary wishes were formalised in a properly drawn will, the terms of which conferred an identified testamentary gift upon the third party. If the will as drawn was properly executed, it was certain that the third party would receive that gift. It was therefore in both of their interests that the will as drawn was properly executed. In those circumstances, the third party was properly described as an "intended 68 Hill v Van Erp (1997) 188 CLR 159 at 167, 183-185, 188, 199, 234. 69 (1997) 188 CLR 159 at 167-168. 70 Hill v Van Erp (1997) 188 CLR 159 at 167, 187, 188, 196-197, 236. beneficiary". In Hill v Van Erp, the duty owed to the intended beneficiary could not have arisen at a point in time before the interests of the testator and the intended beneficiary were the same, consistent or coincident. Did the appellants' duty to use reasonable care in the preparation of the testator's will extend to Mr Calvert and was that duty breached? The answer to both questions is no. It is necessary to ask whether, at the time the appellants breached the duty they owed to the testator, the testator's and Mr Calvert's interests were the same, consistent or coincident. To answer that question, the alleged breach must be identified. The appellants owed a duty of care to the testator to use reasonable care in the preparation of the will. In Tasmania, where a person owes a duty to take reasonable care, the breach of duty must be considered against s 11 of the Civil Liability Act 2002 (Tas) ("the CL Act"). Under that section, before a breach of a duty can be established, certain conditions must be satisfied. They are satisfied in this case. There was a "foreseeable", and "not insignificant", risk that the testator or Mr Calvert would suffer "harm"71 if the appellants did not use reasonable care in the preparation of the will72. "[I]n the circumstances, a reasonable person in the position of" the appellants would have "taken precautions" to avoid the risk73. A reasonable solicitor in the position of the appellants would have observed that the testator's instructions made no provision for any family member and then would have made an inquiry about the testator's family. The appellants did neither of those things. The appellants failed to use reasonable care in the preparation of the will. That was a breach of the duty which the appellants owed the testator. But at the time of that alleged breach, Mr Calvert's interests were not the same as, consistent with or coincident with the testator's. The will had not been drawn. It cannot be said with any certainty what the testator would have done had the appellants made inquiries about whether he had any family members. The testator may have made a different decision about Mr Calvert's testamentary gift that would have been detrimental to Mr Calvert's interests. It follows that because the interests of the testator and Mr Calvert were not the same, consistent or coincident at the time of the alleged breach, the appellants 71 "[H]arm" is defined to mean "harm of any kind", including "pure economic loss": s 9 of the CL Act. 72 s 11(1)(a) and (b) of the CL Act. 73 s 11(1)(c) of the CL Act. did not owe Mr Calvert a duty of care, because if they had, it would not have been the same as, consistent with or coincident with the duty of care they owed to the testator. Mr Calvert was not an "intended beneficiary" in the same way as the third party was in Hill v Van Erp. Causation But even if the appellants owed Mr Calvert a duty of care and that duty was breached (which I do not accept), did that breach cause Mr Calvert loss or damage? To answer that question, the loss or damage must first be identified. Before Blow CJ the loss or damage was calculated by reference to the reduction in the value of the estate by reason of the Orders made in the TFM Act proceeding74. Before both the Full Court75 and this Court, the loss was defined by reference to the testator's loss of an opportunity to arrange his affairs differently. Regardless of how the relevant loss is defined, s 13(1)(a) of the CL Act imposes a requirement of "factual causation" for a negligence claim to be successful – whether "the breach of duty was a necessary element of the occurrence of the harm". Section 14 provides that "[i]n deciding liability for breach of a duty, the plaintiff always bears the onus of proving, on the balance of probabilities, any fact on which the plaintiff wishes to rely relevant to the issue of causation". Section 14 reflects the "general standard of proof" discussed in Those provisions require Mr Calvert to prove, on the balance of probabilities, that but for the appellants' breach of duty, he would have received the entirety (or at least a greater portion) of the testator's estate. That "inquiry directs attention to all the circumstances"77 at the time the appellants were retained and failed to undertake the work, the preparation of the will, with reasonable care. Mr Calvert could not establish, on the balance of probabilities, what the testator would have done if the appellants had observed that the testator's instructions made no provision for any family member and then made an inquiry 74 Calvert v Badenach (2014) 11 ASTLR 536; [2014] TASSC 61. 75 Calvert v Badenach [2015] TASFC 8 at [33]-[34], [86], [97], [140]. 76 (2010) 240 CLR 537 at 585 [136]; [2010] HCA 12 citing Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 355, 367; [1994] HCA 4. 77 Tabet v Gett (2010) 240 CLR 537 at 586 [140]. of the testator about his family. That conclusion is compelled by, at least, the following facts and matters. First, given the lack of contact between the testator and his daughter, the testator was unlikely to have been able to provide the solicitor with any information concerning his daughter and her circumstances. Second, and most importantly, the possible responses of the testator to being told that his daughter could make a claim under the TFM Act are as diverse as they are numerous. They include the possibility of the testator instructing the appellants to make further inquiries about his daughter so that a potential claim under the TFM Act might be considered; the testator deciding to make provision for his daughter with or without the benefit of that additional information; the testator instructing the appellants to do nothing; or the appellants advising the testator to create a joint tenancy in respect of the properties. That list is by no means exhaustive. Mr Calvert was required to adduce evidence of what would have been done by the testator if the appellants had observed that the testator's instructions made no provision for any family member and then made an inquiry of the testator about his family. He did not do that. There was no evidence, let alone persuasive evidence, that was sufficient to establish what the testator would have done if the appellants had not breached the duty that they owed78. Mr Calvert did not prove what steps (if any) the testator would have taken had the appellants discharged the duty of care they owed to the testator, or that by reason of the testator having taken those steps, he would have received the entirety (or at least a greater portion) of the testator's estate. In short, Mr Calvert did not establish that the appellants' negligence caused his loss. It is for that reason that issues of the sufficiency or value of the "opportunity" purportedly lost do not arise for consideration – the first and necessary step of proving, on the balance of probabilities, a causal relationship between the tortious conduct and the purported "loss of opportunity", before any assessment of the amount of the loss79, was absent. This can be directly contrasted with the position in Sellars v Adelaide Petroleum NL80. There, it was found, on the balance of probabilities, that the contract would have been entered into but for the impugned conduct81. Here, Mr Calvert could not prove, on the balance of probabilities, what the testator would have done had there not been a breach of duty (assuming such a duty existed). In particular, Mr Calvert could 78 cf Smeaton v Pattison [2002] QSC 431 at [39] upheld on appeal in Smeaton v Pattison [2003] QCA 341 at [18], [26], [32]. 79 Sellars (1994) 179 CLR 332 at 364. 80 (1994) 179 CLR 332. 81 Sellars (1994) 179 CLR 332 at 346-347, 356, 368. not prove, on the balance of probabilities, that the testator would have taken steps necessary for him to have acquired a better outcome than in fact happened, such as receiving the entirety (or at least a greater portion) of the testator's estate82. In finding that Mr Calvert was required to prove on the balance of probabilities what the testator would have done, the views expressed by the majority in Allied Maples Group Ltd v Simmons & Simmons83 about the requirements of proof of causation where loss depends on the actions of a third party may be put aside. Those views are not consistent with ss 13(1)(a) and 14 of the CL Act or authority in Australia84. Orders I agree with the orders proposed by French CJ, Kiefel and Keane JJ. 82 Sellars (1994) 179 CLR 332 at 367-368. 83 [1995] 1 WLR 1602 at 1611, 1614; [1995] 4 All ER 907 at 915-916, 919. 84 See Sellars (1994) 179 CLR 332 at 355, 367-368.
HIGH COURT OF AUSTRALIA NORTHERN TERRITORY OF AUSTRALIA & ANOR  APPELLANTS AND ARNHEM LAND ABORIGINAL LAND TRUST & ORS RESPONDENTS Northern Territory of Australia v Arnhem Land Aboriginal Land Trust [2008] HCA 29 30 July 2008 ORDER Appeal allowed in part. Set aside the order first numbered 2 of the orders of the Full Court of the Federal Court of Australia made on 2 March 2007 and, in its place, order that it be declared that: Sections 10 and 11 of the Fisheries Act (NT) do not confer on the Director of Fisheries (NT) a power to grant a licence under that Act which licence would, without more, authorise or permit the holder to enter and take fish or aquatic life from areas within the boundary lines described in the Arnhem Land (Mainland) Grant and the Arnhem Land (Islands) Grant made under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth). Appellants to pay the first, second and third respondents' costs of and incidental to the appeal to this Court. On appeal from the Federal Court of Australia Representation D F Jackson QC with V B Hughston SC for the appellants (instructed by Solicitor for the Northern Territory) B W Walker SC with S A Glacken for the first, second and third respondents (instructed by Northern Land Council) M A Perry QC with G J Kennedy for the fourth respondent (instructed by Cridlands) D M J Bennett QC, Solicitor-General of the Commonwealth with R J Webb QC for the fifth respondent (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Northern Territory of Australia v Arnhem Land Aboriginal Trust Aboriginals – Land rights – Rights to exclude persons from tidal waters under Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ("Land Rights Act") – Grants of "Estate in Fee Simple" extending to low water mark – Grants subject to Land Rights Act – Subject of grants "Aboriginal land" under Land Rights Act – Under Land Rights Act, s 70(1), a "person shall not enter or remain on Aboriginal land" – Defence under Land Rights Act, s 70(2A), if person enters or remains on land in accordance with that Act, or law of Northern Territory – Under Aboriginal Land Act (NT) relevant Land Council may grant permission to enter and remain on Aboriginal land – Meaning of "Aboriginal land" – Whether, without permission, licensee under Fisheries Act (NT) ("Fisheries Act") can fish in "intertidal zone", or in tidal waters within boundaries of grants – Whether fishing in those waters is to "enter or remain on Aboriginal land" – Construction of Land Rights Act, s 70(1) – Whether licensee under Fisheries Act does not contravene Land Rights Act, s 70(1), because enters or remains on land "in accordance with … a law of the Northern Territory". Statutes – Construction – Whether Fisheries Act, by necessary implication, abrogated any pre-existing common law public right to fish in tidal waters – Whether Fisheries Act permits licensee to enter any place to fish in accordance with licence – "Application" of Fisheries Act – Public rights of navigation – Approach to interpretation – Whether legislation extinguishing Aboriginal rights requires specificity. Words and phrases – "Aboriginal land", "enter or remain on Aboriginal land", "Estate in Fee Simple", "public right of navigation", "public right to fish", "waters of the sea". Aboriginal Land Act (NT), ss 4, 5, 12. Aboriginal Land Rights (Northern Territory) Act 1976 (Cth), ss 3(1), 70(1), Fisheries Act (NT), ss 10(1), 10(2), 11. GLEESON CJ, GUMMOW, HAYNE AND CRENNAN JJ. The central issue arising in this appeal is whether a grant in fee simple, made under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ("the Land Rights Act"), confers rights to exclude from tidal waters within the boundaries of the grant persons who wish to take fish or aquatic life in those waters, including persons holding a licence under the Fisheries Act (NT) ("the Fisheries Act"). That issue arises in litigation the origins of which can be traced to Aboriginal traditional owners of parts of Blue Mud Bay in northeast Arnhem Land wishing to determine their rights to exclude fishermen and others from waters in that area. On 30 May 1980, pursuant to the Land Rights Act1, the Governor-General executed deeds of grant of an estate in land to the first respondent (Arnhem Land Aboriginal Land Trust – "the Land Trust") in relation to two areas described in Sched 1 to the Land Rights Act. One grant, the Arnhem Land Mainland Grant ("the Mainland Grant"), concerned approximately 90,000 square kilometres of the mainland of the Northern Territory between the mouth of the East Alligator River in Van Diemen Gulf (in the west) and the mouth of the Roper River in the Limmen Bight (in the east) but excluding Cobourg Peninsula. The other grant, the Arnhem Land Islands Grant ("the Islands Grant"), concerned all the islands (except Groote Eylandt) in the Northern Territory generally adjacent to the land the subject of the Mainland Grant. The Yolngu people are the traditional owners of parts of Arnhem Land, including areas of Blue Mud Bay. Blue Mud Bay lies within the Mainland Grant. Before the Land Rights Act came into force, Blue Mud Bay fell within the Arnhem Land Reserve created in 1931 "for the use and benefit of Aboriginal native inhabitants" under the Crown Lands Ordinance 1927 (NT) and under subsequent Northern Territory Ordinances dealing with reserves. Both grants made under the Land Rights Act described the interest granted as "an Estate in Fee Simple". The Land Trust must exercise its powers as owner of the land "for the benefit of the Aboriginals concerned"2. The Land Trust must act in accordance with the directions of the relevant Land Council3 – the Northern Land Council – and the functions of the Land Council, under the Land Rights Act, include the protection of the interests of the traditional Aboriginal ss 10(1) and 12(1)(a). 2 Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ("the Land Rights Act"), s 5(1)(b). Crennan owners of, and other Aboriginals interested in, Aboriginal land in the area of the Both grants were subject to the provisions of the Land Rights Act and to some conditions, exceptions and reservations. Each extended to low water mark and included areas bounded by straight lines joining the seaward extremities of the banks of rivers, streams and estuaries intersecting the coast. The grants encompass the area of land that is covered and uncovered by water at different times of the day, depending upon the position of the tides ("the intertidal zone"). In addition, rivers and estuaries are affected by the ebb and flow of the tides and tidal waters therefore extend landward of the straight line boundaries of the grants. The Land Rights Act refers5 to land the subject of grants, like the Mainland Grant and the Islands Grant, as "Aboriginal land". Section 70(1) of the Land Rights Act provides that "[a] person shall not enter or remain on Aboriginal land" and prescribes a penalty for doing so. The general prohibition in s 70(1) is qualified in several respects by other provisions of the Land Rights Act and it will be necessary to describe and examine those qualifications in more detail. Immediately, however, it is sufficient to notice that in proceedings for an offence against s 70(1) it is a defence6 if the person enters or remains on the land "in performing functions under [the Land Rights] Act or otherwise in accordance with [the Land Rights] Act or a law of the Northern Territory". One law of the Northern Territory relevant to s 70(1) and the defence for which s 70(2A) provides is the Aboriginal Land Act (NT) ("the Aboriginal Land Act"). Under the Aboriginal Land Act7 the relevant Land Council may grant permission to enter and remain on Aboriginal land. Power to enact such a law was given to the s 23(1)(b). s 3(1), "Aboriginal land". 6 When the Full Court of the Federal Court gave its judgment in this matter, the relevant provision took the form quoted and was contained in s 70(2A) of the Land Rights Act. That section was later amended. With some minor and presently irrelevant changes the substance of the provision made by the former s 70(2A) was thereafter contained in s 70(2A)(e) and (h) of the Land Rights Act. Crennan Legislative Assembly of the Northern Territory by s 73(1) of the Land Rights Act8. This appeal is brought by the Northern Territory and the Director of Fisheries for the Northern Territory against orders of the Full Court of the Federal Court of Australia. That Court made declarations about the application and validity of the operation of the Fisheries Act in areas within the boundary lines described in the Mainland Grant and the Islands Grant and about whether the Fisheries Act confers power to grant a licence which would authorise or permit the holder to enter and take fish or aquatic life from areas subject to those grants. As mentioned at the outset of these reasons, the central issue in this appeal is whether, without permission from the Land Trust, a person holding a licence under the Fisheries Act can fish in the intertidal zone within the boundaries of either the Mainland Grant or the Islands Grant, or in the tidal waters within those boundaries. To resolve that issue it will be necessary to consider two questions. Is fishing in those waters to enter or remain on Aboriginal land? This question should be answered, "yes". Does a person who holds a licence under the Fisheries Act enter or remain on that land "otherwise in accordance with ... a law of the Northern Territory", so as to found a defence to contravention of s 70(1) of the Land Rights Act? This question should be answered, "no". The proceedings below Two proceedings the Federal Court of Australia were tried concurrently. One proceeding, instituted by the Land Trust (the first respondent in this Court), the Northern Land Council (the second respondent), and the third respondents in this Court ("the native title holders"), sought declarations of their rights under the grants that have been described and sought orders restraining both the Director of Fisheries and the Northern Territory itself from issuing fishing licences in relation to areas the subject of claims to native title (which "The power of the Legislative Assembly of the Northern Territory under the Northern Territory (Self-Government) Act 1978 in relation to the making of laws extends to the making of: (b) laws regulating or authorizing the entry of persons on Aboriginal land, but so that any such laws shall provide for the right of Aboriginals to enter such land in accordance with Aboriginal tradition". Crennan included areas within the boundaries of the grants). The other proceeding was a claim to native title by persons who included the native title holders. The proceeding seeking declarations that the rights of the traditional owners over the intertidal zone or in the tidal waters within the boundaries of the grant were exclusive of all others was commenced, at least in part, in order to resolve a difference of opinion that had arisen in about 1996 or 1997 between the Northern Land Council on the one hand, and the Director of Fisheries on the other about whether the Director could, pursuant to the Fisheries Act, grant licences to persons to fish in, and enter upon, the intertidal zone. There had been reports of commercial fishing and fishing by non-Aboriginals within Blue Mud Bay, although it was not known whether the persons who were observed fishing had been issued with Fisheries Act licences. The Northern Land Council considered that the Director of Fisheries could not "authorise fishing in waters overlying Aboriginal land". The Director of Fisheries considered that tidal waters over Aboriginal land were not part of the Aboriginal land and that fishing licences could validly authorise fishing in those waters. Evidence was presented at trial by officers of the Northern Land Council and by members of the Yolngu people that strangers had engaged in fishing activities within the boundaries of the Mainland Grant. There was no evidence that these strangers were holders of a Fisheries Act licence or were purporting to act pursuant to permission granted by a Fisheries Act licence. Some evidence was led at trial of an arrangement between the Northern Land Council, the Land Trust and a commercial crabber authorising commercial crabbing within the boundaries of the grants. At trial there was debate about whether the proceeding instituted by the Land Trust, the Northern Land Council and the native title holders constituted a "matter". The trial judge (Selway J) held that there was sufficient evidence in the correspondence of a "real dispute as to the powers under the Fisheries Act and whether those powers could be used to interfere with the rights claimed by the applicants". Accordingly, his Honour found that there was a matter which could be determined by proceedings seeking declarations of the respective rights and powers of the parties9. The trial judge concluded10, however, that the first proceeding seeking declarations and injunctions should be dismissed but that, in the second 9 Gumana v Northern Territory (2005) 141 FCR 457 at 472 [49]. 10 (2005) 141 FCR 457 at 462 [2]-[3]. Crennan proceeding, a determination of native title should be made. In the first proceeding, his Honour held that the Land Rights Act and the grants made under that Act gave the Land Trust an estate in fee simple to the low water mark11. If the matter had been free from authority, Selway J would have concluded12 that "a statutory grant of an estate in fee simple to the low water mark necessarily conferred a right to exclude from the inter-tidal zone, including a right to exclude those seeking to exercise a public right to fish or to navigate". But Selway J held that authority binding upon him (particularly the decision of the Full Court of the Federal Court in Commonwealth v Yarmirr13) required the opposite conclusion. Accordingly, Selway J held that the grants did not confer the right to exclude persons exercising public rights to fish in the intertidal zone or in the tidal waters on the landward side of the boundaries of the grants14. Before orders giving effect to these conclusions were made, Selway J died. The parties agreed that another judge of the Federal Court (Mansfield J) should make such orders as followed from the reasons for judgment which Selway J had published and orders were made accordingly. The plaintiffs in the first proceeding (the Land Trust, the Northern Land Council and the native title holders) appealed to the Full Court of the Federal Court against the orders of Mansfield J dismissing that proceeding. In the second proceeding, the native title holders appealed against the determination of native title (seeking a larger determination than had been made) and the Commonwealth and the Northern Territory cross-appealed against the determination. The Full Court (French, Finn and Sundberg JJ) made orders15 disposing of the several appeals and cross-appeals that had been instituted in respect of the two proceedings. It is not necessary to trace the detail of those orders. For immediate purposes what is important is the declarations, made by the Full Court, that: "[T]he Fisheries Act 1988 (NT): 11 (2005) 141 FCR 457 at 478 [69]. 12 (2005) 141 FCR 457 at 483 [73]. 13 (1999) 101 FCR 171. 14 (2005) 141 FCR 457 at 486 [85]-[86]. 15 Gumana v Northern Territory (2007) 158 FCR 349. Crennan has no application in relation to areas within the boundary lines described in the Deeds of Grant [in respect of the Mainland Grant or the Islands Grant]; does not confer on the [Director of Fisheries] a power to grant a licence under that Act, which licence would authorise or permit the holder to enter and take fish or aquatic life from areas subject to the Grants; is invalid and of no effect in so far as it purports to operate with respect to areas subject to the [G]rants." Those declarations are the focus of the appeal to this Court by the Northern Territory and the Director of Fisheries for the Territory. An issue, agitated in the courts below, about whether the Fisheries Act regulates the conduct of persons permitted by the Land Trust to enter and to fish in those waters was not pressed in this Court. Counsel for the parties at whose suit the declarations were made – the Land Trust, the Northern Land Council and the native title holders – accepted that the declaration made in the present matter by the Full Court, that the Fisheries Act "has no application in relation to areas within the boundary lines described" in the Mainland Grant and the Islands Grant, could not be supported. That is, counsel for those parties accepted that the Fisheries Act operates according to its tenor in waters within the boundaries of Aboriginal land. Counsel recognised that licences under the Fisheries Act did not purport to grant access to lands or seas upon which fishing could take place or which would need to be traversed before rights under a licence could be exercised. Licences merely authorised the specific activity of fishing. Accordingly, the particular detail of the operation of the Fisheries Act was not examined in argument and is not considered in these reasons. Because the plaintiffs at whose suit the declarations were made (the Land Trust, the Northern Land Council and the native title holders) did not seek to support, in oral argument, the first of the declarations made by the Full Court, the appeal by the Territory and the Director must be allowed, at least to that extent. And as will later be explained, in written submissions made after the conclusion of the oral hearing, the Land Trust, the Northern Land Council and the native title holders also accepted that the second and third declarations should be set aside and a more limited declaration made, to the effect that the Fisheries Act does not "without more" authorise or permit entry into areas within the boundaries of the grants. Identifying the relevant questions Crennan The relevant questions in the present appeal have been identified earlier in these reasons as being, first, whether fishing in the intertidal zone or in the tidal waters within the boundaries of the grants is to "enter or remain on Aboriginal land", and secondly, whether a person who holds a licence under the Fisheries Act enters or remains on that land "otherwise in accordance with ... a law of the Northern Territory". It is the answers to those questions that determine what declarations the Full Court should have made. Those questions are framed by reference to s 70 of the Land Rights Act. To explain why they are the questions that must be addressed, it is necessary to deal first with some matters which underpinned much of the argument in the courts below but which, on examination, should be put aside from consideration. Those matters are first, the suggestion that there is a common law public right to fish in tidal waters of the Northern Territory, and second, the suggestion that a licence granted under the Fisheries Act permits the holder of the licence to go into any waters or perhaps any particular areas of water for the purposes of fishing in accordance with the licence. It will also be necessary to say a little more about the proposition that the Fisheries Act does not "apply" within the boundaries of the grants, or is to an extent invalid, and to make very brief mention of public rights of navigation. A public right to fish? Much of the argument in the appeal to this Court, and in the courts below, proceeded from the premise that there is a common law public right to fish in tidal waters and that the immediately dispositive question in the litigation required identification of how that right does or does not intersect with the rights given by the grants under the Land Rights Act. These reasons will show that this premise is wrong. No question arises of any intersection between a common law right to fish and rights given by the grants under the Land Rights Act. It is convenient to refer to the right to fish relied on in argument in this Court and in the courts below as a "common law" right because it finds its roots not only in the writings of Coke, Bracton and Hale16, but also in English judicial decisions since at least the 17th century17. 16 The history of the right is described in Moore and Moore, The History and Law of Fisheries, (1903) at xxxvii-xliii. 17 See, for example, Lord Fitzwalter's Case (1673) 1 Mod 105 [86 ER 766]. Crennan In the relevant volume of the first edition of Halsbury's Laws of England, published in 1910, it was said18: "In all waters within the territorial limits of the kingdom, subject to the flow and reflow of the tide, the public, being subjects of the realm, are entitled to fish19, except where the King or some particular subject has gained a propriety exclusive of the public right20, or Parliament has restricted the common law rights of the public. ... As the public right of fishery is dependent on the presumed ownership of the soil by the Crown, the area in which the right may be exercised is limited to the Crown's right to the soil. It extends, therefore, only to the high-water mark of ordinary tides21, and as far up rivers as the tide in the ordinary and regular course of things flows and reflows". And only a few years later, in 1913, Viscount Haldane LC, speaking for the Privy Council in Attorney-General (British Columbia) v Attorney-General (Canada)22, said: "Since the decision of the House of Lords in Malcomson v O'Dea23, it has been unquestioned law that since Magna Charta no new exclusive fishery could be created by Royal grant in tidal waters, and that no public right of fishing in such waters, then existing, can be taken away without competent legislation. This is now part of the law of England, and their Lordships entertain no doubt that it is part of the law of British Columbia." (emphasis added) 18 vol 14 at 574, pars 1269-1270 (footnotes omitted in part). 19 Ward v Creswell (1741) Willes 265 [125 ER 1165]. 20 Royal Fishery of Banne Case (1610) Dav 55 [80 ER 540]; Lord Fitzwalter's Case (1673) 1 Mod 105 [86 ER 766]; Neill v Duke of Devonshire (1882) 8 App Cas 135. 21 Attorney-General v Chambers (1854) 4 De G M & G 206 [43 ER 486]; Malcomson v O'Dea (1863) 10 HLC 593 [11 ER 1155]. 22 [1914] AC 153 at 170. 23 (1863) 10 HLC 593 [11 ER 1155]. Crennan It is against this background that, in Harper v Minister for Sea Fisheries24, Brennan J (with whose reasons the other members of the Court agreed in this respect) spoke of the existence of a public right to fish in tidal waters being accepted in Australia. But as Brennan J also pointed out in Harper25, because the common law right of fishing in the sea and in tidal navigable rivers is "a public not a proprietary right, [it] is freely amenable to abrogation or regulation by a competent legislature". Because the common law right of fishing is amenable to statutory abrogation or regulation, no conclusion may be reached about whether a common law right to fish in tidal waters of the Northern Territory persists without first considering the Fisheries Act. That Act is an enactment of the Parliament of the Northern Territory pursuant to authority granted by s 6 of the Northern Territory (Self-Government) Act 1978 (Cth), extended by s 5 of the Coastal Waters (Northern Territory Powers) Act 1980 (Cth). That legislation empowers the Director of Fisheries to regulate all fishing and includes the power to grant licences for commercial fishing. Section 10(1) of the Fisheries Act provides that: "Subject to this Act or to an instrument of a legislative or administrative character made under it, a person shall not – take any fish or aquatic life; unless the person does so under and in accordance with a licence." The sub-section then prescribes the penalty for contravention of that prohibition as "$20,000 or imprisonment for 2 years". The general prohibition in s 10(1) is then qualified by a number of other provisions. In particular, s 10(2) provides that: "Nothing in this section shall apply to the taking of fish or aquatic life by a person for subsistence or personal use only (and not for the purposes of sale), within such limits (if any) relating to numbers, quantity, 24 (1989) 168 CLR 314 at 330; [1989] HCA 47. 25 (1989) 168 CLR 314 at 330. Crennan size, weight, methods, types and amounts of fishing gear, and periods of time (including closed and open seasons), as may be prescribed for any such fish or aquatic life." And s 11 provides for the grant of an appropriate licence to a person "who proposes to do any thing specified in section 10(1)". Inc – "the Seafood Council" – and The fourth and fifth respondents in this Court (respectively, the Northern Territory Seafood Council the Commonwealth) both submitted that licences granted under the Fisheries Act permit access to areas within the boundaries of the grants to the Land Trust made under the Land Rights Act. But a basis for the argument was not articulated beyond reference to the continued existence of the common law public right to fish which, so it was submitted, had not been abrogated by the Fisheries Act. The Commonwealth submitted that the Fisheries Act "preserves and operates upon the public rights of fishing, albeit heavily regulated". And the appellants' submissions that the common law public right to fish authorises entry to areas within the boundaries of the grants depended upon the common law public right to fish not having been abrogated by statute. These submissions should not be accepted. The statutory abrogation of a public right may appear not only from express words but by necessary implication from the text and structure of the statute26. By necessary implication, the Fisheries Act (and in particular ss 10 and 11) abrogated any public right to fish in tidal waters in the Northern Territory that existed before the Fisheries Act was enacted. (It is not necessary to examine whether the right was abrogated by earlier legislation.) Just as "when a prerogative power of the Executive Government is directly regulated by statute, the Executive can no longer rely on the prerogative power but must act in accordance with the statutory regime laid down by the Parliament"27, the comprehensive statutory regulation of fishing in 26 Chief Commissioner for Railways and Tramways (NSW) v Attorney-General for New South Wales (1909) 9 CLR 547 at 560; [1909] HCA 75; Wik Peoples v Queensland (1996) 187 CLR 1 at 185-186, 248-249; [1996] HCA 40; cf Campbell v Macdonald (1902) 22 NZLR 65. 27 Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 459 per McHugh J; [1997] HCA 36. See also Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 69-70 [85]; [2005] HCA 50; Barton v The Commonwealth (1974) 131 CLR 477 at 501; [1974] HCA 20; Attorney-General v De Keyser's Royal Hotel [1920] AC 508. Crennan the Northern Territory provided for by the Fisheries Act has supplanted any public right to fish in tidal waters. It is the statutory exclusion provided by s 10(2), in favour of fishing for subsistence or personal use only, to which a person fishing in tidal waters may look for exemption from the otherwise general prohibition of s 10(1) against fishing except "under and in accordance with a licence" issued under the Act. And a person may rely upon that exemption only "within such limits (if any)" relating to the matters identified in s 10(2) as may be prescribed for any such fish or aquatic life. But whether and how a person may take fish or aquatic life in the Northern Territory are questions to be answered by resort to the Act, not any common law public right. The common law public right has been abrogated. It follows that the outcome of the present litigation does not depend upon resolving any competition between a public right (the right to fish) and whatever may be the rights conferred on the Land Trust by the grants made under the Land Rights Act. It is necessary, however, to go on to consider whether there is some relevant competition between rights derived from the Fisheries Act and the rights of the Land Trust under the grants. That is, because no common law right to fish in the tidal waters of the Northern Territory survived the enactment of the Fisheries Act, it becomes necessary to inquire whether the Fisheries Act seeks to provide that a person who acts in accordance with that Act may enter and fish in waters that lie within the boundaries of the grants. (It is not necessary to distinguish between the intertidal zone and the tidal waters on the landward side of the straight line boundaries.) The declarations made by the Full Court may be understood as assuming that, if otherwise valid, the Fisheries Act purports to authorise entry to waters within the boundaries of the grants for the purpose of taking fish or aquatic life. So much is implicit in the declaration that the Fisheries Act does not confer power to grant a licence that would permit the holder to enter those waters, and the declaration that the Fisheries Act is invalid and of no effect in so far as it purports to operate with respect to those waters. It is necessary to examine whether the Fisheries Act or a licence granted under that Act does authorise entry to any particular area. The Fisheries Act The general provision for licences made by s 11 of the Fisheries Act contemplates (s 11(7)) that a licence may be issued subject to conditions, including conditions relating to areas that may be used. Several examples of Crennan fishing licences of varying scope were in evidence in the proceeding before Selway J. One of these is described as a "Coastal Line Fishery Licence". Some had conditions attached. Among the conditions imposed on the licences in evidence were conditions restricting the "fishery region" or the "area of operation" of the licence. Other conditions of some of the licences stipulated which vessels may be used, what "gear" was to be used, the necessity for the attendance of the licensee, and the species of fish or aquatic life which might be taken under the licence. One licence contained the statement in a condition relating to the "area of operation" that "[n]othing in the licence or these conditions shall diminish the licensee's responsibility for obtaining any necessary approvals from land owners to transit through, or operate the licence within" the stipulated area of operation. Neither the licence itself nor any provision of the Fisheries Act confers any permission upon the holder to enter any particular place or area for the purpose of fishing. Several provisions of the Fisheries Act affect where a person may fish. Section 22 permits declaration of an area, place or any waters as "a fishery management area" and declaration of a fishery as "a managed fishery". Management plans may then be declared in respect of such areas and those plans may regulate fishing in those areas. Where a person may fish may also be affected by exercise of the power given by s 55 of the Fisheries Act to grant a lease of Crown land for aquaculture. It is to be noted, however, that s 55(4) provides: "A lease does not of itself confer upon the lessee the right to exclude a person from passing over the surface of any water, but the conditions of the aquaculture licence may require or authorize the lessee to mark out a lease or part of a lease that indicates that passage through that area is restricted or prohibited." Reference should also be made to s 53(1), which permits Aboriginals who have traditionally used the resources of an area of land or water in a traditional manner to continue to use those resources in that area in that manner. Section 53(1) provides: "Unless and to the extent to which it is expressed to do so but without derogating from any other law in force in the Territory, nothing in a provision of this Act or an instrument of a judicial or administrative character made under it shall limit the right of Aboriginals who have traditionally used the resources of an area of land or water in a traditional Crennan manner from continuing to use those resources in that area in that manner." Sub-section (2) provides that nothing in s 53(1) authorises a person to enter any area used for aquaculture, to interfere with or remove fish or aquatic life from fishing gear that is the property of another person or to engage in commercial activity. But apart from the provisions that have been mentioned, the Fisheries Act does not deal with where persons may fish. Rather, the Fisheries Act provides for where persons may not fish. And nothing in that Act authorises persons (whether as the holder of a licence or otherwise) to enter any particular place or area for the purpose of fishing. Counsel for the first to third respondents (the Land Trust, the Northern Land Council and the native title holders) did not contend to the contrary. In particular, to the extent that the second and third declarations made by the Full Court were premised upon construing the Fisheries Act as purporting to provide for the issue of a licence that would permit the holder to enter areas within the boundaries of the grants, the first to third respondents accepted that a licence granted under the Act did not, without more, permit entry. And the first to third respondents did not seek to support the third declaration that had been made: that the Fisheries Act is invalid in so far as it purports to operate with respect to areas subject to the grants. Does the Fisheries Act "apply" within the boundaries of the grants? In the courts below, much attention was directed to whether the Fisheries Act "applied" within the boundaries of the grants. And as noted earlier, the Full Court's first declaration was that the Fisheries Act "has no application in relation to areas within the boundary lines described" in the grants. Again, however, the plaintiffs at whose suit the declaration was made (the Land Trust, the Northern Land Council and the native title holders) accepted in this Court that that declaration cannot be supported and should be set aside. To ask whether the Fisheries Act "applies" in areas the subject of the grants does not expressly identify the subject of the debate. In the Full Court, the more specific question identified28 was whether the Fisheries Act could operate concurrently with the Land Rights Act if, and to the extent that, the Fisheries Act 28 (2007) 158 FCR 349 at 366 [59]. Crennan did not authorise any interference with the rights conferred by the Land Rights Act. The Full Court concluded29 that the grants under the Land Rights Act "conferred a right to exclude from the intertidal zone including a right to exclude those seeking to exercise a public right to fish or to navigate". The Full Court considered30 that the consequence was that the Fisheries Act "has to be read down under s 59 of the Interpretation Act 1978 (NT) so as not to authorise the grant of a licence to take fish in relation to the intertidal zone". As the reference to s 59 of the Interpretation Act shows, the Full Court's conclusion was founded in considerations of the legislative power of the Northern Territory Legislative Assembly. But as the reference to exclusion of "those seeking to exercise a public right to fish" shows, the Fisheries Act was treated as doing no more than regulating the exercise of that right. Once it is recognised not only that the common law right to fish in tidal waters has been abrogated by the Fisheries Act, but also that a licence under the Fisheries Act gives no authority to enter any identified area, it is apparent that the debate in the courts below about the "application" of the Fisheries Act proceeded from incorrect premises. Rights of navigation Finally, it is necessary to notice that, although mention was made in the courts below of public rights of navigation, it was not suggested in argument in this Court that the public's right to pass and repass, and to remain for a reasonable time31 in tidal waters for all purposes of navigation, trade and intercourse32 extended to taking fish or other aquatic life in the intertidal zone or tidal waters within the boundaries of the grants. In this connection, it was not suggested that the references made by this Court to public rights of navigation in The Commonwealth v Yarmirr33 and in Western Australia v Ward34 bore directly upon the issues that must be considered. Rather, reference was made in argument to public rights of navigation as explaining how it could be that a person might enter the intertidal zone by sea and then exercise what was said to 29 (2007) 158 FCR 349 at 372 [90]. 30 (2007) 158 FCR 349 at 372 [90]. 31 Orr Ewing v Colquhoun (1877) 2 App Cas 839. 32 Halsbury's Laws of England, 1st ed, vol 28 at 400, par 767. 33 (2001) 208 CLR 1; [2001] HCA 56. 34 (2002) 213 CLR 1; [2002] HCA 28. Crennan be either a common law public right to fish or a right given by the licence issued under the Fisheries Act. The relevant questions restated Having decided that any common law right to fish has been abrogated and that the Fisheries Act does not authorise persons (whether as the holder of a licence or otherwise) to fish in any particular place or area, attention must turn to the Land Rights Act and the grants that have been made under it. In particular, do the Land Rights Act and the grants made under it permit the Land Trust to exclude persons who hold a licence under the Fisheries Act from entering waters that lie within the boundaries of the grants? And those questions turn, in the first instance, upon the proper construction of s 70 of the Land Rights Act and proper application of the expression "Aboriginal land". The parties' arguments The appellants (the Northern Territory and the Director of Fisheries) and the Seafood Council submitted that the prohibition in s 70 against entering or remaining on Aboriginal land prohibited entry or remaining on only the dry land of the intertidal area (when exposed by the tide) and did not prohibit entry or remaining on the tidal waters overlying that land. The Commonwealth advanced a generally similar argument but also urged an analysis that proceeded by examining whether the grants made under the Land Rights Act should be understood as abrogating the common law public right to fish (or the common law public right of navigation). The first to third respondents submitted that the grants to the Land Trust related to a defined geographical area and that entry within the boundaries of that area (whether covered by tidal waters or not) was prohibited by s 70. The submission of the first to third respondents should be accepted and the contrary submissions of the appellants and of the Seafood Council and the Commonwealth rejected. The Land Rights Act Section 4(1) of the Land Rights Act obliged the Minister responsible for the administration of the Act to establish Aboriginal Land Trusts "to hold the Crown land described" in Sched 1 to the Act. There were some qualifications to that obligation provided by s 10(1) and (2) of the Act but those qualifications are not relevant. Section 10(1) then obliged the Minister to recommend to the Governor-General "that a grant of an estate of fee simple in that land, or in the Crennan part of that land to which subsection (2) does not apply, be made to that Land Trust". Again, the qualification to that obligation, if s 10(2) were engaged, may be set aside as irrelevant. Section 12(1)(a) empowered the Governor-General to "execute a deed of grant of an estate in the land in accordance with the recommendation and deliver it to the grantee". The areas which are the subject of the grants which are now in issue were described in Sched 1 to the Land Rights Act. They were defined by metes and bounds which, for the sea boundaries of the areas, were fixed as a relevant "low water mark". The Land Rights Act thus expressly provided for the grant of interests in fee simple over areas that included areas that would be covered by tidal waters. The grants that are now in question were effected in accordance with the statutory steps described. By defining the areas granted by reference to low water marks, the grants gave effect to the expressly intended operation of the Act. The Land Rights Act's adoption of the description of the interest to be granted as "an estate of fee simple" must be understood giving due weight to a number of other provisions of the Act. First, a deed of grant under s 12 was to be expressed to be subject to reservations about minerals and mineral explorations that were identified in that section. Secondly, a deed of grant under s 12 was to be expressed to exclude from the grant land on which a road over which the public had a right of way existed at either of two identified times35. Thirdly, on the application of a Land Trust to which a deed of grant was delivered, "the Registrar-General or other appropriate officer under the law of the Northern Territory relating to the transfer of land" was obliged36 to "register and otherwise deal with that deed of grant under that law according to its tenor". That is, the deed could be, and deed of grant of the areas now in issue have been, registered under the Torrens title system of title by registration adopted in the Territory37. Fourthly, the power of a Land Trust to deal with any estate or interest in the land was circumscribed by the Land Rights Act, particularly ss 19, 19A and 20. 35 Section 12(3A) – the commencement of s 3 of the Act and the time of execution of the deed of grant. 37 The Real Property Act (NT) has been replaced by the Land Title Act (NT). Crennan The evident purpose of the restrictions on alienation was to confine the classes of persons to whom, and the circumstances in which, the land might be alienated. Alienation to Aboriginals or to Aboriginal or Torres Strait Islander corporations for residential or business purposes of Aboriginals was permitted (s 19(2)). Alienation to the Commonwealth, the Northern Territory, or an Authority of the Commonwealth or the Territory for a public purpose, or to a mission for any purpose was permitted (s 19(3)). But subject to some other exceptions whose detail need not be noticed, an estate or interest in the land, the term of which exceeds 40 years38, could be granted only if particular conditions were met. Those conditions included not only the written consent of the Minister and the written direction of the relevant Land Council, but also the consent of traditional owners of the land39. It is thus apparent that the interest granted under the Land Rights Act differed in some important ways from the interest ordinarily recorded under the Torrens system as an estate in fee simple. But despite these differences, because the interest granted under the Land Rights Act is described as a "fee simple", it must be understood as granting rights of ownership that "for almost all practical purposes, [are] the equivalent of full ownership"40 of what is granted. In particular, subject to any relevant common law qualification of the right41, or statutory provision to the contrary, it is a grant of rights that include the right to exclude others from entering the area identified in the grant. Chief emphasis was placed by the appellants (and the parties who supported them, the Commonwealth and the Seafood Council) on the argument that the right of the Land Trust, as the holder of the fee simple, to exclude others from entering land was qualified by the common law public right to fish. That is, chief emphasis was placed by these parties on arguments that assumed that the 39 s 19(4A) and (5). 40 Nullagine Investments Pty Ltd v Western Australian Club Inc (1993) 177 CLR 635 at 656 per Deane, Dawson and Gaudron JJ; [1993] HCA 45. See also Mabo v Queensland [No 2] (1992) 175 CLR 1 at 80 per Deane and Gaudron JJ; [1992] HCA 23; Fejo v Northern Territory (1998) 195 CLR 96 at 126 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [1998] HCA 41 Fejo (1998) 195 CLR 96 at 128 [47] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. Crennan grants in question were to be understood as identifying boundaries to what was granted that did not require the making of some further distinction between the land underlying the intertidal areas and the waters lying above those areas. But in so far as those parties made the submission that the grants were limited to rights over the solid surface of the earth, and gave no rights in respect of the superjacent waters, the submission should be rejected. It is convenient to begin consideration of this aspect of the argument by noticing three uncontroversial propositions. First, the immediate question to be decided in this matter is whether entering or remaining within the intertidal areas, when those areas are covered by water, is to enter or remain on Aboriginal land. That is a question about the proper construction of s 70(1) of the Land Rights Act. Secondly, the Land Rights Act makes frequent reference to "land", and that is ordinarily understood as referring to a solid portion of the earth's surface. Thirdly, it is not to be supposed that the grants to the Land Trust give a proprietary interest to the grantee in respect of any particular column of water that might overlie the intertidal zone. Because the immediate question in the present matter depends upon the proper construction and application of s 70(1) of the Land Rights Act, it is neither necessary nor productive to attempt to define exhaustively the nature or extent of the rights conferred by the grants over the intertidal zones when they are covered by water. In particular, the question of statutory construction is not answered directly by identifying what rights are conferred by the grants or by asking whether a grant of an estate in fee simple, made under the Land Rights Act, should be understood as subject to a common law right to fish or a common law right of navigation. The references made in argument to a distinction between the dry land and land covered by water are therefore to be understood as arguments directed to the proper construction of either the reference to "Aboriginal land" in s 70(1) or, perhaps, the reference in that provision to "enter or remain". That is, the distinction that was drawn sought to limit the application of s 70(1) to conduct involving direct contact with the solid surface of the earth. The asserted distinction between dry land and the land in the intertidal zone when covered by water should not be drawn. The Aboriginal land which is the subject of the grants now in issue is defined by metes and bounds. To define the land in that way requires that s 70(1) is given effect, according to its terms, by reference to those metes and bounds and without regard to whether the tide is in or out at the time of an alleged entry or remaining. Nothing in the Land Rights Act requires a different conclusion. Crennan Risk v Northern Territory Reference was made in argument to Risk v Northern Territory42. In Risk, this Court held that "land in the Northern Territory" in s 3(1) of the Land Rights Act does not include the seabed below the low water mark of bays or gulfs within the limits of the Territory. As was pointed out in Risk43, "[t]he distinction between 'land' and 'sea' is often made", and "'land' is ordinarily used in a way that would not include the seabed". Particular reference was made in Risk to s 73 of the Land Rights Act, a provision dealing with reciprocal legislation of the Northern Territory. One of the heads of legislative power of the Territory's Legislative Assembly dealt with by s 73(1)(d) is "laws regulating or prohibiting the entry of persons into, or controlling fishing or other activities in, waters of the sea, including waters of the territorial sea of Australia, adjoining, and within 2 kilometres of, Aboriginal land, but so that any such laws shall provide for the right of Aboriginals to enter, and use the resources of, those waters in accordance with Aboriginal tradition". The plurality reasons in Risk concluded44 that if a grant could be made under the Land Rights Act to the seabed below the low water mark of bays or gulfs, s 73(1)(d) would have little or no useful work to do. If a grant could be made under the Land Rights Act in respect of the seabed below low water mark of bays and gulf, it would not be necessary to have legislative power to provide for a two kilometres buffer zone adjoining Aboriginal land. If the Land Rights Act permitted the making of a grant of the seabed of waters below low water mark, the references in s 73(1)(d) to traditional Aboriginal owners entering and using the resources of waters within two kilometres of Aboriginal land would not be needed to protect the interests of either those who were the traditional Aboriginal owners of the area or of others who, though not owners, were entitled to use the waters for traditional purposes. By contrast, provision of power to pass legislation prescribing a two kilometre buffer zone of sea adjoining the boundary of Aboriginal land makes evident sense if the boundary of Aboriginal land is fixed at low water mark, as it is in the grants now under consideration, and if the prohibition on entering and remaining on Aboriginal land is engaged 42 (2002) 210 CLR 392; [2002] HCA 23. 43 (2002) 210 CLR 392 at 404 [26] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 44 (2002) 210 CLR 392 at 404-405 [29] per Gleeson CJ, Gaudron, Kirby and Crennan whether or not the intertidal area is covered with water. But if that prohibition operates only when and to the extent that the intertidal zone can be entered on foot, the provision for enactment of legislation providing a buffer zone would necessarily operate in a very odd way. Two conclusions can be drawn from these considerations. First, what is said in Risk neither requires nor supports the conclusion that "Aboriginal land" when used in s 70(1) should be understood as confined, in intertidal zones, to only the land surface of that area. Secondly, the provisions of s 73(1)(d) support the view, expressed earlier, that the expression "Aboriginal land", when used in s 70(1), should be understood as extending to so much of the fluid (water or atmosphere) as may lie above the land surface within the boundaries of the grant and is ordinarily capable of use by an owner of land. As explained earlier in these reasons, a contrary construction of s 70(1), of the kind urged by the appellants, the Commonwealth and the Seafood Council, is not supported by reference to a common law public right to fish. That right has been abrogated by legislation. Nor can reference to common law rights of navigation support the view that s 70(1) should be given the limited operation urged by those parties. As explained earlier in these reasons, reference was made to these rights to explain how a person could enter the intertidal zones without traversing Aboriginal land. What is in issue in this case is whether the holder of a licence issued under the Fisheries Act may fish in the intertidal zone or in tidal waters within the boundaries of the grants. That activity goes beyond the exercise of any right of navigation. Further, like the common law right to fish, common law rights of navigation are susceptible to legislative abrogation. Once it is recognised that the essential question at issue concerns the proper construction and application of s 70(1), rather than any question of competition between the rights of a landholder and public rights, reference to public rights of navigation provides no assistance to the task of statutory construction. Conclusion and orders For the reasons that have been given, s 70(1) can be engaged if a person holding a licence under the Fisheries Act enters or remains on waters within the boundaries of the grants. Whether s 70(1) is engaged in any particular case turns upon whether the entry or remaining is "in accordance with [the Land Rights Act] or a law of the Northern Territory". As explained earlier, the holding of a licence under the Fisheries Act is not within that qualification to the operation of s 70(1). But again as noted earlier, under the Aboriginal Land Act, permission can be given by a Land Council to enter and remain upon Aboriginal land. Crennan Exercise of permission granted under the Aboriginal Land Act would be to enter or remain on the land in accordance with that law of the Northern Territory. The principal arguments advanced by the appellants, the Commonwealth and the Seafood Council, should be rejected. But because the declarations made by the Full Court were framed too widely it is necessary that the appeal be allowed to the extent necessary to reframe the orders. The form of declaration should substantially follow the form proposed by the appellants. The orders of the Court should be: Appeal allowed in part. Set aside the order first numbered 2 of the orders of the Full Court of the Federal Court of Australia made on 2 March 2007 and in its place order that it be declared that: Sections 10 and 11 of the Fisheries Act (NT) do not confer on the Director of Fisheries (NT) a power to grant a licence under that Act which licence would, without more, authorise or permit the holder to enter and take fish or aquatic life from areas within the boundary lines described in the Arnhem Land (Mainland) Grant and the Arnhem Land (Islands) Grant made under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth). Consistent with the undertakings given as a condition for the grant of special leave to appeal to this Court there should be a further order that: The appellants pay the first, second and third respondents' costs of and incidental to this appeal. Kirby KIRBY J. I agree in the orders proposed by Gleeson CJ, Gummow, Hayne and Crennan JJ. Generally, I agree with their reasons ("the joint reasons"). As explained in those reasons, the issues presented for decision in this Court include: The construction of ss 3(1), 10(1), 12(1), 19, 19A, 20, 70 and 73 of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ("the Land Rights Act"); The construction of s 5(1) of the Aboriginal Land Act (NT) ("the Aboriginal Land Act"); The construction of ss 10, 11, 22, 53 and 55 of the Fisheries Act (NT) ("the Fisheries Act"); and The determination of the extent to which, if at all, the Fisheries Act abrogates any common law public right to fish45, common law rights of navigation46 and the Aboriginal interests in land granted pursuant to the Land Rights Act and the Aboriginal Land Act ("the Land Acts"). Deciding meaning before determining power The unanimous reasons of the Full Court of the Federal Court of Australia47, challenged in this appeal, demonstrate that there is an arguable basis for that Court's opinion. This was that the applicable provisions of the Fisheries Act should be read down, pursuant to s 59 of the Interpretation Act (NT), so as not to empower the issue of a licence under that Act to take fish in the intertidal zone where such activity would fall within the boundary of an estate in fee simple granted to Aboriginal owners under the Land Rights Act. On the basis explained by the Full Court, that approach to the issue of statutory power has much to be said for it. 45 cf Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 330; [1989] HCA 47. See joint reasons at [19]-[31]. 46 The Commonwealth v Yarmirr (2001) 208 CLR 1; [2001] HCA 56; Western Australia v Ward (2002) 213 CLR 1; [2002] HCA 28; cf joint reasons at [40]. 47 Gumana v Northern Territory (2007) 158 FCR 349 at 372 [90]-[91]. Kirby However, the conventional method of tackling questions such as those raised in this appeal is first to ascertain the meaning of the contested legislation before addressing any questions of power that remain to be decided48. Adopting that course in the present case obliges this Court to examine closely the language and apparent purposes of the Fisheries Act, and the manner of its operation when read alongside the Land Acts. This process yields the meaning of the Fisheries Act favoured in the joint reasons. It avoids the need (which a different meaning might have presented) to examine the power of the Northern Territory, by the Fisheries Act, to produce the consequences for which the Territory (and those supporting its submissions) contend. Governing principles of statutory interpretation The conclusion expressed in the joint reasons is reinforced, in my view, by adopting the approach to the definition, enlargement or diminution of native title rights that I sought to explain in Griffiths v Minister for Lands, Planning and Environment (NT)49. That approach finds support in judicial decisions upon analogous problems of statutory construction adopted by courts of high authority in other common law jurisdictions, called upon to declare the ambit of the legal rights to the traditional interests of indigenous peoples living in societies settled during colonial times50. Most clearly, several Canadian decisions insist that51: "Indian title … being a legal right, it could not … be extinguished except by surrender to the Crown or by competent legislative authority, and then only by specific legislation." 48 Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 186; [1948] HCA 7; R v Hughes (2000) 202 CLR 535 at 582-583 [117]; [2000] HCA 22; Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 662 [81]; [2000] HCA 33. 49 (2008) 82 ALJR 899 at 915-920 [87]-[108]. 50 See eg New Zealand Maori Council v Attorney-General [1987] 1 NZLR 641; cf Nijman, "Ascertaining the Meaning of Legislation – A Question of Context", (2007) 38 Victoria University of Wellington Law Review 629 at 653-654. See also Paul v Canadian Pacific Ltd (1983) 2 DLR (4th) 22 at 33; Nowegijick v The Queen [1983] 1 SCR 29 at 36. 51 Calder v Attorney-General of British Columbia [1973] SCR 313 at 402 per Hall J (emphasis added); cf Slattery, "Understanding Aboriginal Rights", (1987) 66 Canadian Bar Review 727 at 766-767. Compare Mabo v Queensland [No 2] (1992) 175 CLR 1 at 111 per Deane and Gaudron JJ; [1992] HCA 23; Wik Peoples v Queensland (1996) 187 CLR 1 at 155 per Gaudron J, 185 per Gummow J ("clearly and distinctly"); [1996] HCA 40. Kirby When that approach is adopted, as it should be, in respect of the propounded intersection of the Land Acts, on the one hand, and the Fisheries Act, on the other, it leads to the interpretation of s 70(1) of the Land Rights Act, and ss 10 and 11 of the Fisheries Act, that the joint reasons have accepted. The interpretation favoured in the joint reasons also accords with a number of other principles of construction which I accept as applicable to the task in hand: It preserves the Aboriginal interests concerned as a species of valuable property rights not to be taken away without the authority of a law clearly intended to have that effect52; It does this against the background of the particular place that such Aboriginal rights now enjoy, having regard to their unique character as legally sui generis53, their history, their belated recognition, their present purposes and the "moral foundation" (now recognised in legislation) for respecting them54; It ensures that, if the legislature of the Northern Territory wishes to qualify, diminish or abolish such legal interests it must do so clearly and expressly, and thereby assume full electoral and historical accountability for any such provision55; and 52 Durham Holdings Pty Ltd v New South Wales (2001) 205 CLR 399 at 415-416 [30]-[31]; [2001] HCA 7; Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 580-582 [101]- [106]; [2002] HCA 49. 53 Guerin v The Queen [1984] 2 SCR 335 at 348-349, 376, 382, 392; cf Wik (1996) 187 CLR 1 at 176 per Gummow J. Although the fiduciary principle has not been accepted as applicable in Australia, the source and origin of communal Aboriginal interests in land is quite different from that of other such interests in Australia: Mabo v Queensland [No 2] (1992) 175 CLR 1 at 58-63; cf Northern Territory v Alyawarr (2005) 145 FCR 442 at 494-495 [187]. 54 Alyawarr (2005) 145 FCR 442 at 461 [63]. 55 R v Home Secretary; Ex parte Simms [2000] 2 AC 115 at 131; R (Morgan Grenfell & Co Ltd) v Special Commissioner of Income Tax [2003] 1 AC 563 at 615 [44]; Plaintiff S157 v The Commonwealth (2003) 211 CLR 476 at 492 [30]; [2003] HCA 2; Chang v Laidley Shire Council (2007) 81 ALJR 1598 at 1614-1615 [85]; 237 ALR 482 at 502; [2007] HCA 37. Kirby It avoids needless argument about the suggested invalidity of the Fisheries Act that might otherwise arise if a broader operation were to be attributed to that Act. Reflecting the considerations that lead to the foregoing legal conclusions, on 13 February 2008 a National Apology was provided to the indigenous peoples of the Commonwealth56. Given the attention to, and nation-wide reflection upon, its making, terms and reconciliatory purposes, it is appropriate in my view for this Court to take judicial notice of that National Apology. The Court does not operate in an ivory tower. The National Apology acknowledges once again, as the preamble to the Native Title Act 1993 (Cth) already did57, the wrongs done in earlier times to the indigenous peoples of Australia, including by the law of this country. Those wrongs included the non-consensual denial and deprivation of basic legal rights which Australian law would otherwise protect and uphold for other persons in the Commonwealth. In the case of traditional Aboriginals, these right included rights to the peaceful enjoyment of their traditional lands and to navigate and to fish as their ancestors had done for aeons before British sovereignty and settlement. Although the National Apology was afforded on behalf of the Government of the Commonwealth, with support of the Opposition58 and other political parties, and reflects an unusual and virtually unprecedented parliamentary initiative, it does not, as such, have normative legal operation. It is not contained in an Act of the Federal Parliament nor in a law made by any other Australian legislature with legislative powers. Yet it is not legally irrelevant to the task presently in hand. It constitutes part of the factual matrix or background against which the legislation in issue in this appeal should now be considered and 56 Australia, House of Representatives, Parliamentary Debates (Hansard), 13 February 2008 at 167-173 (the Hon K M Rudd MP, Prime Minister). See also Rudd, "Federal Government Apology", (2008) 7(4) Indigenous Law Bulletin 2 at 57 See Native Title Act 1993 (Cth) Preamble at par 3 ("progressively dispossessed"), par 4 ("most disadvantaged in Australian society"), par 6 ("recognising international standards"), par 8 sub-par (a) ("rectify the consequences of past injustices"), par 10 ("[j]ustice requires … compensation on just terms"), par 11 ("enjoy fully their rights and interests"), par 12 ("due regard to their unique character"), par 16 ("the descendants of the original inhabitants of Australia"), par 17 ("further advance the process of reconciliation among all Australians"). 58 See Australia, House of Representatives, Parliamentary Debates (Hansard), 13 February 2008 at 173-177 (the Hon B J Nelson MP, Leader of the Opposition). Kirby interpreted59. It is an element of the social context in which such laws are to be understood and applied, where that is relevant. Honeyed words, empty of any practical consequences, reflect neither the language, the purpose nor the spirit of the National Apology. In my opinion, the need for specific and clear legislation to extinguish any traditional legal rights of the indigenous peoples of Australia was already the law of this country, before the National Apology, for the reasons that I elaborated in Griffiths. The National Apology reinforces the appropriateness and timeliness of this approach to the interpretation of all relevant Australian legislation. This Court should adopt that approach and do so uniformly. In my opinion the majority reasons do that in this case. That is why I support the approach that they favour60. Application of the principles to this case Once this analysis is adopted, there is no difficulty in reading the Land Acts, and each of them, alongside the Fisheries Act in a manner that permits all of those statutes to fulfil their evident purposes, according to their terms. The Fisheries Act is not, then, a law of the Northern Territory that gives specific authority, as such, to enter or remain upon "Aboriginal land", contrary to s 70(1) of the Land Rights Act. The Fisheries Act controls the activity of fishing. But, without more, it does not purport to do so within "Aboriginal land". Likewise, the concept of "Aboriginal land", defined as it is, extends to intertidal land61. The fact that, pursuant to the Land Rights Act, relevant land is held for "the benefit of the Aboriginals concerned"62 tends to indicate a recognition of the traditional rights of such Aboriginals to take fish or aquatic life from intertidal areas63. In the context of the determination of the Aboriginal rights in question in this appeal, the joint reasons adopt an approach to the interpretation of the legislation that should be adopted in all such cases; not just this one64. Applied to 59 cf Curthoys, Genovese and Reilly, Rights and Redemption – History, Law and Indigenous People, (2008) at 40-41, 140-141, 229-230. 60 I would repeat what I said in Australian Competition and Consumer Commission v Baxter Healthcare Pty Ltd (2007) 81 ALJR 1622 at 1652-1653 [138]; 237 ALR 512 at 551; [2007] HCA 38. 61 Joint reasons at [58]. 62 Land Rights Act, s 5(1)(b). 63 See joint reasons at [58]. 64 cf Griffiths (2008) 82 ALJR 899. Kirby the legislation in question here, it produces the conclusions stated in the joint reasons. Orders The orders proposed in the joint reasons should be made. HEYDON J. The circumstances underlying this appeal are set out in the plurality judgment. The key question in relation to "Aboriginal land" The Full Federal Court considered that the key question was the effect of grants of an estate in fee simple to the low water mark to the first respondent under and in furtherance of the purpose of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ("the Act"). In particular, the question was whether, as the Full Federal Court considered, those grants denied to persons other than the third respondents the right to obtain access to the waters above the land. The appellants' submissions The relevant grants were made because a Land Trust (the first respondent) had been established in respect of "land constituting, or included within, an area of land described in Schedule 1" (s 10(1)(a) of the Act) and the Minister had recommended to the Governor-General that a grant of an estate in fee simple "in that land" be made to the first respondent (s 10(1) (tailpiece)). Pursuant to s 12(1)(a), in 1980 the Governor-General executed two deeds of grant of those estates "in the land" in accordance with the recommendation. The question propounded by the appellants. Section 70(1) of the Act provides that: "[A] person shall not enter or remain on Aboriginal land." In the present circumstances the relevant meaning of "Aboriginal land" is "land held by a Land Trust for an estate in fee simple": s 3(1). The estates in land granted comprise land held by a Land Trust for an estate in fee simple. The appellants did not seriously contest that the grant included at least the soil on the landward side of the low water mark. One primary submission by the appellants, however, was that the grants did not include the waters above that soil as the tide ebbed and flowed. That is, the appellants submitted that the only "land" granted between high water mark and low water mark was the soil, not the waters above it, and that only the soil was "Aboriginal land". "It is not a grant of fee simple ... in the waters. It is a grant of an estate in land covered by water from time to time." The appellants' reliance on s 73(1). The appellants' submission concentrated on s 73(1). As they pointed out, s 73(1)(a) gives the Legislative Assembly of the Northern Territory power to make laws in relation to "sacred sites ... including sacred sites on Aboriginal land"65 (emphasis added). Section 73(1)(b) gives it power to make "laws regulating or authorizing the entry of 65 See at n 94 below. persons on Aboriginal land"66 (emphasis added). And s 73(1)(c) gives it power to make laws protecting or conserving wildlife including "wildlife on Aboriginal land" (emphasis added). However, s 73(1)(d) gives it power to make: "laws regulating or prohibiting the entry of persons into, or controlling fishing or other activities in, waters of the sea, including waters of the territorial sea of Australia, adjoining, and within 2 kilometres of, Aboriginal land, but so that any such laws shall provide for the right of Aboriginals to enter, and use the resources of, those waters in accordance with Aboriginal tradition". (emphasis added) The appellants stressed the distinction between "Aboriginal land" as referred to in each of pars (a), (b), (c) and (d) of s 73(1) and "waters of the sea ... adjoining, and within 2 kilometres of, Aboriginal land" as referred to in s 73(1)(d)67. The appellants submitted that it is not correct to limit the meaning of "waters of the sea" to those waters of the sea which are beyond the boundaries of Aboriginal land, ie seaward of the low water mark. The submission was directed to reasoning of the Full Federal Court which centred on the following proposition68: "[T]he text, structure and context of [the Act] itself indicate that certain particular benefits were intended to be conferred upon or (in the case of the s 73(1)(d) legislative compromise) denied to, the Aboriginals by the grant to the low water mark." The Court said that what Aboriginals traditionally regarded as their land extended well beyond low water mark and well beyond any 2 kilometre buffer zone seaward of low water mark. The Court considered that the grant of a fee simple to low water mark gave limited recognition to that traditional view, but only limited recognition, because the s 73(1)(d) legislative compromise "denied a Land Trust the benefit of the inclusion of the 2 km seaward buffer zone in the definition of 'Aboriginal land'". However, the "grant to the low water mark (as distinct from the high water mark)", coupled with the facility in s 73(1)(d) for the 66 See above at [6]. 67 They noted that Callinan J said in Risk v Northern Territory (2002) 210 CLR 392 at 434 [117]; [2002] HCA 23: that s 73(1)(d) "indicates ... that sea waters require and are given separate statutory treatment from land; ... and ... that special provision for the pursuit of Aboriginal activities in sea waters, which would otherwise not be necessary if they were claimable lands, was necessary." 68 Gumana v Northern Territory (2007) 158 FCR 349 at 373 [94] per French, Finn Northern Territory Legislative Assembly to protect the traditional Aboriginal view by making laws preventing the entry of non-Aboriginals into the 2 kilometre buffer zone, afforded some recognition of that traditional view. This reasoning treated the waters of the sea above the soil landward of the low water mark as entirely distinct from waters of the sea seaward of the low water mark. The reasoning treated the former waters as being Aboriginal land, and the latter waters as "waters of the sea". The appellants submitted that the construction relied upon led to extraordinary results: it meant that s 73(1)(d) conferred power to make laws to prohibit the entry of persons into the 2 kilometre zone, and to control fishing and other activities there, but conferred no power to make laws on these subjects in the adjacent intertidal zone above the low water mark. Even assuming the Full Federal Court's construction to be correct, in that latter zone, while regulation would be possible by enacting a s 73(1)(b) law, prohibition by means of a law enacted by the Legislative Assembly would not be possible and prohibition would rest only with Land Councils, despite their limited capacity in that respect. But the appellants submitted that whether or not the construction led to extraordinary results, in any event the language of s 73(1)(d) did not support the distinction at the heart of that construction. The appellants argued that there was a difference between "waters of the territorial sea of Australia" and "waters of the sea" in general. The territorial sea of Australia is an area the breadth of which is measured by a distance – formerly three nautical miles, now 12 – from low water mark or straight base lines drawn across bays, gulfs and the like by proclamations made by the Governor-General under s 7 of the Seas and Submerged Lands Act 1973 (Cth). The "waters of the sea" include the territorial sea, but also include tidal waters above the soil on the landward side of the low water mark. The appellants submitted that their argument was supported by the fact that the expression "waters of the sea" is commonly employed in Commonwealth legislation to include all waters, whether above or below low water mark69 – that is, whether they are part of the territorial sea or not. 69 The Seas and Submerged Lands Act 1973 (Cth), s 10, distinguishes between internal waters and the territorial sea thus: "It is by this Act declared and enacted that the sovereignty in respect of the internal waters of Australia (that is to say, any waters of the sea on the landward side of the baseline of the territorial sea) so far as they extend from time to time, and in respect of the airspace over those waters and in respect of the sea-bed and subsoil beneath those waters, is vested in and exercisable by the Crown in right of the Commonwealth." The legislative assumption is that "waters of the sea" lie on both sides of the baseline. The Customs Act 1901 (Cth), s 73(2), prohibits breaking the bulk cargo of an aircraft arriving in or on a flight to Australia while the aircraft is flying over Australia or "in, or flying over, waters of the sea within the outer limits of the territorial sea of Australia". The legislative assumption is that "waters of the sea" (Footnote continues on next page) The appellants' adoption of McHugh J and Callinan J. The appellants then advanced various arguments which adopted by quotation, summary and cross-reference statements made in Risk v Northern Territory by McHugh J and The ordinary meaning of "land". One argument was that the primary submission of the appellants follows from the ordinary meaning of "land". McHugh J said70: "In its ordinary meaning, 'land' means the 'solid portion of the earth's surface, as opposed to sea, water'." McHugh J accepted that a statutory meaning could depart from the ordinary meaning. But he said that all of the provisions of the Act "are consistent with the term 'land' meaning that solid portion of the earth's surface above the low water mark of the sea surrounding the Northern Territory and its adjacent islands"71. He also said72: "[Section] 73(1)(d) strongly suggests that closure orders made by the Administrator were to be the Act's only mechanism for protecting the rights of the traditional Aboriginal owners to their 'sea country'. Section 73(1)(d) operates on the assumption that the 'waters of the sea' are not 'Aboriginal land' within the meaning of s 3 of [the Act]." are not restricted to the outer limits of the territorial sea. The Historic Shipwrecks Act 1976 (Cth), s 3A(1)(b), refers to removal of part of a ship from "waters of the sea that are within the limits of a State": since waters within the limits of a State are "internal waters", and not part of the territorial sea (The Commonwealth v Yarmirr (2001) 208 CLR 1 at 56-57 [63]; [2001] HCA 56), the legislative assumption is that "waters of the sea" includes waters above the low water mark. See also Defence Act 1903 (Cth), s 51(1) (definitions of "Australian waters" and "internal waters"). In addition to the instances referred to by the appellants, see Control of Naval Waters Act 1918 (Cth), s 2(1) (definitions of "sea" and "waters"); Protection of the Sea (Powers of Intervention) Act 1981 (Cth), s 3(1) (definition of "internal waters"); Admiralty Act 1988 (Cth), s 3(1) (definitions of "inland waters" and "sea"); Offshore Petroleum Act 2006 (Cth), s 326 (definitions of "area to be avoided" and "prescribed safety zone"). The same usage is employed in State legislation, eg Native Vegetation Act 1991 (SA), s 3(1) (definition of "waters of the sea"). 70 Risk v Northern Territory (2002) 210 CLR 392 at 407 [42], quoting Shorter Oxford English Dictionary, vol 1, 3rd ed (rev) (1975) at 1172. 71 Risk v Northern Territory (2002) 210 CLR 392 at 412 [60]. 72 Risk v Northern Territory (2002) 210 CLR 392 at 412-413 [61]. McHugh J then said that there were "other indications – although far from conclusive – that the legislation was concerned with land as a solid portion of the earth's surface above the low water mark"73. Entitlement to "forage". The first of these indications turned on an element in the definition of "traditional Aboriginal owners". The functions of an Aboriginal Land Commissioner under s 50(1) included functions in relation to "traditional land claims". That expression is defined in s 3(1) thus: "traditional land claim, in relation to land, means a claim by or on behalf of the traditional Aboriginal owners of the land arising out of their traditional ownership." The expression "traditional Aboriginal owners" is defined thus in s 3(1): "traditional Aboriginal owners, in relation to land, means a local descent group of Aboriginals who: have common spiritual affiliations to a site on the land, being affiliations the group under a primary spiritual responsibility for that site and for the land; and that place are entitled by Aboriginal tradition to forage as of right over that land." McHugh J discussed the entitlement to "forage" thus74: "The term 'forage' includes 'the act of searching for provisions of any kind'75. In that sense, it is wide enough to include fishing in the seas below the low water mark and the recovery of clams, oysters and other edibles attached to or on the seabed. But the more natural meaning of the term 'forage' is the search for food on land above the low water mark. The historic and primary meaning of the term was and still is 'food for horses and cattle'76. Although in s 3 'forage' obviously has a wider meaning than obtaining food for horses and cattle, it requires a strained construction of the term to regard it as including fishing or the recovery of edibles on or attached to the seabed. The natural meaning of 'forage' and its association 73 Risk v Northern Territory (2002) 210 CLR 392 at 413 [62]. 74 Risk v Northern Territory (2002) 210 CLR 392 at 413 [62]. 75 Macquarie Dictionary, 3rd ed (1998) at 825. 76 Shorter Oxford English Dictionary, vol 1, 3rd ed (rev) (1975) at 784; Macquarie Dictionary, 3rd ed (1998) at 825. in s 3 with a 'right over that land' indicates that 'land' in [the Act] is referring to land above the low water mark." Hence, the appellants' argument implied, if an entitlement by Aboriginals to fish in waters covering the land above the low water mark is irrelevant to a claim by them to be "traditional Aboriginal owners", those waters are incapable of being granted to a Land Trust and cannot be "Aboriginal land" within the definition of that term in s 3(1). Similarly, Callinan J, after citing numerous dictionary "The word 'foraging' may in some circumstances have a contemporary meaning extending to the act of searching for provisions of any kind, or of wandering in search of supplies, or of hunting or searching about on sea or on land, but it certainly does not have a primary meaning of fishing or exploiting the seas or seabeds. A description of fishing as foraging has the appearance of a metaphor rather than of an accurate statement of fact. The primary and preferable meaning that the word conveys is of activities on land." Sections 11 and 18. A second group of indications that the legislation was concerned with land as a solid portion of the earth's surface above the low water mark was described thus by McHugh J78: "Section 11(3) declares that a reference [in s 11(1), (1AB), (1AD) or (1AE)] 'to land shall be read as not including any reference to any land on which there is a road over which the public has a right of way'. Section 11 also refers to 'the land, or a part of the land' and to 'different parts of the land'. Section 11(1AF) deals specifically with recommendations for grants of land comprised in a road over which the public right of way has ceased to exist. Section 18 deals with the vesting of an estate in fee simple in land in a Land Trust where 'the land is being occupied or used by a mission with the licence or permission of the Crown'." The appellants submitted that these provisions supported the conclusion that "land" was something distinct from the waters of the sea. Section 23(2). A third indication that the legislation was concerned with land as a solid portion of the earth's surface above the low water mark was said by McHugh J to be the following79: 77 Risk v Northern Territory (2002) 210 CLR 392 at 436 [126] (footnote omitted). 78 Risk v Northern Territory (2002) 210 CLR 392 at 413 [63]. "Section 23(2) describes one of the functions of a Land Council as including 'schemes for the management of wildlife on Aboriginal land'. Significantly, there is no reference to schemes for managing fishing or the taking of edibles from the sea or seabed." Section 46. The fourth indication that the legislation was concerned with land as a solid portion of the earth's surface above the low water mark was put "Section 46, which deals with the terms and conditions on which a grant of mining interests in respect of Aboriginal land may be made, requires an intending miner to make a statement to the relevant Land Council concerning certain matters. They include the 'amount of vehicular access to and within the affected land with reference to any proposals to construct roads, landing strips or other access facilities' (s 46(1)(a)(iv)) and 'the water, timber and other requirements to be obtained from the affected land' (s 46(1)(a)(vi)). The section is clearly dealing with that part of the earth's surface that is not covered by the sea. Significantly, the Act makes no provision for mining in the sea or the seabed." "All of the above sections suggest or at all events confirm that 'land' in [the Act] is confined to the solid portion of the earth's surface above the low water mark." Section 50(3)(c) and (4). The appellants also referred to two other statutory indications relied on by Callinan J and supportive of McHugh J's 79 Risk v Northern Territory (2002) 210 CLR 392 at 413 [64]. Section 23(2) provides that a Land Council may "perform any functions that may be conferred on it by a law of the Northern Territory, including … functions in relation to: (a) the protection of sacred sites; (b) access to Aboriginal land; and (c) schemes for the management of wildlife on Aboriginal land." 80 Risk v Northern Territory (2002) 210 CLR 392 at 413-414 [65]. 81 Risk v Northern Territory (2002) 210 CLR 392 at 414 [66]. "Section 50(3)(c) requires the Commissioner, in making a report, to comment on the effect that acceding to a claim would have on the existing, or proposed 'patterns of land usage in the region' a phrase neither immediately nor readily applicable to the fishing and navigation of sea waters. Nor is it without significance that the Commissioner is not obliged to comment on, if not patterns of the usage of the seas, at least the means and frequency of resort to, and exploitation of them. Section 50(4) refers to places where Aboriginals are living 'on' traditional country and to the aim '[of] acquir[ing] secure occupancy', again expressions more naturally appropriate to land, than to the seabed or the sea." The Arnhemland case. In addition, the appellants relied on Arnhemland Aboriginal Land Trust v Director of Fisheries (NT)83, where Mansfield J held that: the waters above low water mark were waters of the sea; the power in s 73(1)(d) to make laws "closing the seas" in a sense of prohibiting people from entry was not limited to closing them in an area 2 kilometres seaward of low water mark; the words "adjoining ... Aboriginal land" in s 73(1)(d) included all waters coming into contact with Aboriginal land, "whether overlying that land in the intertidal zone or seaward of the low water mark"; and (implicitly) that the waters overlying Aboriginal land in the intertidal zone were not themselves Aboriginal land. Accordingly, the appellants submitted that the "word 'adjoining' is one that covers waters above as well as waters that are seaward". Aboriginal Land Commissioners. The appellants also relied on statements which they said were supportive of their submission made by Judges of the Federal Court of Australia or the Supreme Court of the Northern Territory acting as Aboriginal Land Commissioners determining Aboriginal land claims84 or 82 Risk v Northern Territory (2002) 210 CLR 392 at 435-436 [124]-[125]. 83 (2000) 170 ALR 1 at 10-11 [33]-[34], reversed on other grounds in Director of Fisheries (NT) v Arnhem Land Aboriginal Land Trust (2001) 109 FCR 488. 84 See those referred to in Arnhemland Aboriginal Land Trust v Director of Fisheries (NT) (2000) 170 ALR 1 at 9 [26]. reporting to the Administrator of the Northern Territory on whether certain seas should be closed under s 12 of the Aboriginal Land Act (NT)85. Two caveats Risk v Northern Territory. It is necessary at once to enter a caveat about the use in this appeal of Risk v Northern Territory. In that case the issue was whether the expression "Crown land" in s 50(1)(a) of the Act, which was defined in s 3(1) as a species of "land in the Northern Territory", included the seabed below the low water mark of bays or gulfs within the limits of the Territory. It was held unanimously that it did not. The issue was thus different from that posed by the appellants in the present appeal, namely whether the expression "Aboriginal land", in its application to land which is above the low water mark but is covered by tidal waters as the tide comes in, applies only to the surface of the soil or extends to the waters above it. Hence, what McHugh J and Callinan J said on the latter issue consisted of obiter dicta, and in some respects what they said is better adapted to the issue before the Court in that case than the issue before it in this. In particular, the Court in that case did not have to resolve, or seek to resolve, what were described in the plurality judgment as two unargued questions86. One was whether "a grant of an estate in fee simple in the seabed would permit the grantee to prevent the exercise of public rights to fish or to navigate in the waters above that part of the seabed". The other concerned the construction of s 70(1). An aspect of the first question does arise in the present case, and so does the second question. Being dicta, the observations of McHugh J and Callinan J are not binding, any more than a statement to the contrary made in the plurality judgment is87. Reports of Aboriginal Land Commissioners. Another caveat must be entered in relation to opinions expressed in the reports of Federal Court Judges or Judges of the Supreme Court of the Northern Territory sitting as Aboriginal Land 85 Closure of Seas: Castlereagh Bay/Howard Island Region of Arnhem Land, (Report by Aboriginal Land Commissioner Justice Kearney to the Administrator of the Northern Territory, 1 July 1998) at 17-18, pars 80-81. 86 Risk v Northern Territory (2002) 210 CLR 392 at 405 [32] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 87 Risk v Northern Territory (2002) 210 CLR 392 at 405 [32] per Gleeson CJ, Gaudron, Kirby and Hayne JJ: "[T]here is nothing in [the Act] which appears to limit the rights of the holder of an estate in fee simple in land granted under the Act to rights over only the solid substance of the earth's crust, as distinct from those parts of the superjacent fluid (be it liquid or gas) which can ordinarily be used by an owner." Commissioners. While the carefully considered opinions of distinguished lawyers delivered on a solemn occasion, particularly in a field of which they have specialised knowledge, can, with respect, have great value, they are in a different category from statements of the law made in the course of exercising judicial power. Although those opinions merit careful attention, they are in the end only valuable to the extent that their reasoning is persuasive. The answer of the first three respondents The arguments of the appellants described above were put as part of their written submissions in chief, although to a limited extent they were developed orally, and some of the points made by the appellants were briefly put by the Commonwealth orally. However, while the first three respondents dealt at length with the appellants' submissions going to other issues, they offered few arguments having any relevance to the arguments of the appellants summarised above88, and none which grappled with their detail. They did not mention, let alone deal with, the relevant paragraphs of the appellants' written submissions on that subject. In particular, the first three respondents did not refer critically to the paragraphs in Risk v Northern Territory setting out the reasoning of McHugh J and Callinan J on which the appellants relied. They did rely on a dictum in the plurality judgment in Risk v Northern Territory89 which was contrary to the dicta of McHugh J and Callinan J, but they did not offer specific submissions criticising either the reasoning in the dicta of McHugh J and Callinan J, or what the appellants said about the reasoning in those dicta in their submissions in chief. Thus they did not offer any argument explaining directly and in terms why that reasoning was wrong. Although this silence does not of itself make the appellants' submissions correct, reasons will be given below why the appellants' submissions should be accepted90. But first it is necessary to deal with the arguments which the first three respondents did advance in relation to the issue propounded by the appellants. Reformulation of question. The first three respondents offered a refinement of the principal question propounded by the appellants. The first three respondents said the question was not whether the first respondent owned "the flowing water" above the land on the landward side of the low water mark: the question was rather whether the first respondent could bring an action in trespass against someone who brought a vessel onto those waters, or whether that 89 (2002) 210 CLR 392 at 405 [32]: quoted at n 87 above. person contravened s 70(1). Even if the question is so reformulated, however, the answer must be adverse to the first three respondents. Consequences of particular construction of s 73(1)(d). The first three respondents said that if the appellants' contention that non-Aboriginal persons could enter the waters covering the soil above low water mark was correct, the effect of s 73(1)(d) would be "odd" because it would be possible under s 73(1)(d) to make laws making the area between low water mark and points 2 kilometres seawards "closed seas". The first three respondents said: "So, we say, what an odd reading of the interaction of the grant, the prohibition on entry and remaining in [s] 70 and the specific lifting of that prohibition for certain Aboriginals in [s] 71, what an odd reading [if] that would produce greater liberty of entry by strangers onto Aboriginal land, the tidal zone, than with sea that happened to be closed offshore of it." The outcome would only be odd if the s 73(1)(d) power to enact laws closing the seas on the seaward side of low water mark did not extend to a power to enact laws closing the seas on the landward side of low water mark as well. As noted above91, the appellants construed s 73(1)(d) as conferring the wider power, while the Full Federal Court construed s 73(1)(d) as conferring the narrower power92. The appellants' construction is the sounder. It is the reliance by the first three respondents on the Full Federal Court's construction of s 73(1)(d) that produces the oddness, and the appellants' construction removes it. The sacred sites. The first three respondents referred to s 69(1), which provides: "[A] person shall not enter or remain on land in the Northern Territory that is a sacred site." They also referred to s 69(2A), which is in the same terms as s 70(2A)93. The first three respondents said: "One of the questions which we will seek to raise in a pointed way against our friends as the result of the overall analysis is to [inquire] whether it is truly supposed that the statute with the long title this statute has and against the background shown in the travaux [préparatoires] ... is a statute which leaves open the following prospect, that is, the prospect that somebody claiming to be entering land in accordance with what has been grandly called the common law public right of navigation, thereby escapes the sanctions of the law designed to prevent such entry in relation to sacred sites." 92 Gumana v Northern Territory (2007) 158 FCR 349 at 373-374 [94]. 93 See above at [6]. Section 69(1) refers to "land ... that is a sacred site". Section 70(1) refers to "Aboriginal land". The appeal does not arise out of any specific complaint about entering or remaining on land that is a sacred site. The question which the first three respondents asked is one which is better answered not in the abstract but in the concrete circumstances of a case which raises it. In a case of that kind, it would be necessary to bear in mind that in s 3(1), a "sacred site" is defined as including any land that, under a law of the Northern Territory, is declared to be sacred to Aboriginals or of significance according to Aboriginal tradition. It would also be necessary to consider the terms of any law made by the Legislative Assembly of the Northern Territory pursuant to s 73(1)(a)94. It is thus entirely possible for laws to be made preventing activity in waters above low water mark so as to protect Aboriginal sites and prevent their desecration, and it was suggested in argument that those laws already had been made. Billabongs. The first three respondents submitted that nobody had ever denied that a billabong was part of Aboriginal land, and suggested that the same must be true of land down to low water mark when covered by water. The appeal is not about billabongs, and billabongs are not waters of the sea. Arguments about whether the expression "Aboriginal land" extends to, or has consequences for rights in, the waters covering land between low water mark and high water mark are entirely immaterial to any controversies about billabongs, which, in the unlikely event of their ever arising, can be resolved in litigation directed to their resolution. Statutory scheme. Finally, the first three respondents offered a general analysis of the statutory scheme, which they submitted was consistent only with their desired outcome in relation to the soil landward of the low water mark and the waters above it, and inconsistent with the outcome desired by the appellants. That analysis, general as it was, was not directed to and did not negate the persuasiveness of the specific matters described below. Conclusion relating to "Aboriginal land" The appellants were correct to submit that the grant of "land" down to the low water mark granted the soil, not the tidal waters which covered the area from high water mark to low water mark, and that only the soil was Aboriginal land. That is so for the following reasons. 94 That paragraph refers to: "laws providing for the protection of, and the prevention of the desecration of, sacred sites in the Northern Territory, including sacred sites on Aboriginal land, and, in particular, laws regulating or authorizing the entry of persons on those sites". Ordinary meaning of "land". First, "land" ordinarily means the solid portion of the earth's surface and, in the case of land extending to low water mark, does not include the waters flooding over it and ebbing from it with the tides95. No indications pointing away from the ordinary meaning of "land". Secondly, there are no indications in the Act that the word "land" in that legislation bears a different meaning from the ordinary meaning96. Positive indications supporting the ordinary meaning of "land". Thirdly, apart from s 73(1), there are several positive indications that "land" bears its ordinary meaning in the legislation. None, taken separately, is decisive, but when taken together they have some force. These indications are found in s 50(1) read with the definitions in s 3(1) of "traditional land claim" and "traditional owners" in relation to the entitlement to forage97; s 1198; s 1899; s 23(2)100; s 46101; s 50(3)(c)102; and s 50(4)103. The consequences of s 73(1). Fourthly, the structure of s 73(1) supports the ordinary meaning. Paragraphs (a)-(c) of s 73(1) refer specifically to "Aboriginal land". Section 73(1)(d) also refers to "Aboriginal land", but contrasts that phrase with the phrase "waters of the sea". The phrase "waters of the sea" is expressed to include the territorial sea (ie which may comprise waters on the seaward side of low water mark) but also includes waters in the area between the landward side of low water mark and the seaward side of high water mark. Pursuant to that construction, the waters on the landward side of low water mark are vertically "adjacent" because they are above Aboriginal land, and 95 Risk v Northern Territory (2002) 210 CLR 392 at 407 [42]. 96 Risk v Northern Territory (2002) 210 CLR 392 at 412-414 [60]-[66]. 97 Risk v Northern Territory (2002) 210 CLR 392 at 413 [62] and 436 [126]: see above [86]. 98 Risk v Northern Territory (2002) 210 CLR 392 at 413 [63]: see above [87]. 99 Risk v Northern Territory (2002) 210 CLR 392 at 413 [63]: see above [87]. 100 Risk v Northern Territory (2002) 210 CLR 392 at 413 [64]: see above [88]. 101 Risk v Northern Territory (2002) 210 CLR 392 at 413-414 [65]: see above [89]. 102 Risk v Northern Territory (2002) 210 CLR 392 at 435-436 [124]: see above [90]. 103 Risk v Northern Territory (2002) 210 CLR 392 at 436 [125]: see above [90]. the waters on the seaward side are horizontally "adjacent" because they are next to Aboriginal land104. That construction accords with a standard usage in Commonwealth legislation105. Since the expression "waters of the sea" applies to the waters on either side of low water mark, s 73(1)(d) makes special provision for the Legislative Assembly of the Northern Territory to legislate for the right of Aboriginals to enter, and use the resources of, those waters in accordance with Aboriginal tradition. This would not be necessary if those waters were themselves Aboriginal land, or if rights of entry and use which were exclusive to Aboriginals applied in those waters on the ground that the soil beneath them was Aboriginal land which had been granted to a Land Trust in fee simple106. Effect of s 70(2A) Since the relevant waters are not "Aboriginal land", a person entering the relevant waters in order to fish or traverse them is not in breach of s 70(1). The effect of the defence given by s 70(2A) therefore need not be considered. Nor need any of the arguments on other issues in this appeal, since they fall away. Interrelation of s 70 with s 73 The appellants were also correct to submit that the first respondent could not prevent the otherwise lawful exercise of rights of fishing and navigation in the tidal waters which cover the area from the high water mark to the low water mark. This is so for reasons given by Kiefel J107. Orders The grants to the first respondent did not grant title to the waters above the land granted landwards of the low water mark, and did not create exclusive rights in those waters. The waters were not Aboriginal land, and s 70(1) is not contravened by persons who fish in or traverse those waters. It follows that no declaration which depends on the contrary of either of those propositions should be made. Neither the relief sought at trial nor the relief granted in the Full Federal Court should be granted either. 104 Arnhemland Aboriginal Land Trust v Director of Fisheries (NT) (2000) 170 ALR 1 105 See above [82]. 106 Risk v Northern Territory (2002) 210 CLR 392 at 434 [117]. 107 Reasons of Kiefel J at [141]-[146], [148]-[151], [154]. The appeal should be allowed and the order of Mansfield J dismissing the further amended application should be restored. By reason of a condition on which special leave was granted, the appellants should pay the first, second and third respondents' costs of the appeal. 110 KIEFEL J. The first respondent, the Arnhem Land Aboriginal Land Trust ("the Land Trust"), is an Aboriginal Land Trust established under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ("the Land Rights Act"). On 30 May 1980 the Governor-General executed Deeds of Grant to the Land Trust to hold lands "in Fee Simple subject to the provisions of [the Land Rights Act]". The description of the land and islands in the grants does not correspond with that of the Arnhem Land (Mainland) and Arnhem Land (Islands) in Sched 1 to the Land Rights Act, but it is not disputed that the areas are the same. The boundary of the Mainland grant extends seaward of the coast to the low water mark and by straight lines joins the seaward extremities of estuaries, rivers and streams. The grant to the low water mark, of an area which includes Blue Mud Bay, takes in the intertidal zone. Since the 1990s issues concerning the right of persons to take fish in the Blue Mud Bay area, pursuant to licences issued by the Director of Fisheries of the Northern Territory under the Fisheries Act (NT), have been litigated108. Declarations were sought as to the exclusive rights of the traditional owners to enter and occupy the lands and waters and that the Land Trust was entitled to prevent persons from entering the land and waters or taking fish or aquatic resources. Members of the Yolngu people also sought and obtained a determination of native title to part of the area the subject of the grant109. A Full Court of the Federal Court (French, Finn and Sundberg JJ) ordered, subsequent to that determination, that it be amended to delete reference to the native title holders' rights to make decisions about access to, and the use of, the intertidal zone and outer waters because, at the time of sovereignty, those rights were inconsistent with the public's right of access for fishing and navigation110. That order is not in issue on this appeal. In the proceedings brought with respect to the grants under the Land Rights Act, their Honours declined to follow an earlier decision of a Full Court of the Federal Court in The Commonwealth v Yarmirr111. It had been applied by judges of that Court as holding that a grant of fee simple under the Act did not confer upon a Land Trust the exclusive right to control access to the sea over the 108 See the history referred to in Gumana v Northern Territory (2007) 158 FCR 349 at 109 Gumana v Northern Territory (2005) 141 FCR 457. 110 Gumana v Northern Territory (2007) 158 FCR 349 at 395-396 [170]-[172]. 111 (1999) 101 FCR 171. tidal foreshore112. That aspect of the decision was not considered by this Court in The Commonwealth v Yarmirr113. The Full Court in this case was satisfied that a grant of an estate in fee simple under and for the purposes of the Land Rights Act conferred upon the Land Trust a right to exclude others from the intertidal zone, including those seeking to exercise a public right to fish there114. Their Honours considered that the Act contained a power by which the Land Trust could itself grant a licence which would permit fishing in the zone115. It followed that the Fisheries Act would have to be read down if it were to operate concurrently with the Land Rights Act116. Background to the Land Rights Act In 1931 an area of land was proclaimed as the Arnhem Land Reserve "for the use and benefit of the aboriginal native inhabitants of North Australia" under s 102 of the Crown Lands Ordinance 1927 (NT). The Reserve was described, in the schedule to the proclamation, as bounded by the "coastline". No reference was made to high or low water marks. In 1963 four reserves were consolidated under a proclamation made under the Crown Lands Ordinance 1931 (NT). This followed upon the receipt of the Yirrkala Report, by a Committee established in response to a petition from the Aboriginal people of Yirrkala who made complaints about the use of land in the Reserve for mining purposes117. Sackville J, in Director of Fisheries (NT) v Arnhem Land Aboriginal Land Trust118, observed that the reason for the revocation of the proclamations of the four grants, prior to their consolidation by proclamation on the same day, 28 October 1963, appeared to be that the Yirrkala Report cast some doubt on their validity. The 1963 proclamation identified the boundaries of the lands by reference to the low water marks of various rivers and the Timor and Arafura Seas and used straight lines to join the extremities of the banks of rivers, streams 112 See Arnhemland Aboriginal Trust v Director of Fisheries (NT) (2000) 170 ALR 1 at 13-14 [46] per Mansfield J; reversed on other grounds in Director of Fisheries (NT) v Arnhem Land Aboriginal Land Trust (2001) 109 FCR 488; Gumana v Northern Territory (2005) 141 FCR 457 at 484-485 [80] per Selway J. 113 (2001) 208 CLR 1; [2001] HCA 56. 114 (2007) 158 FCR 349 at 372 [90]. 115 (2007) 158 FCR 349 at 376 [103], referring to Land Rights Act, s 19(11). 116 (2007) 158 FCR 349 at 376 [103], referring to Land Rights Act, s 74. 117 Australia, Report from the Select Committee on Grievances of Yirrkala Aborigines, Arnhem Land Reserve, October 1963. 118 (2001) 109 FCR 488 at 496 [39]. and estuaries. It was these reserve lands which the Land Rights Act came to deal with. Provision was made to control access to Aboriginal reserves under successive Ordinances. In each of the three Ordinances referred to on this appeal119 an offence was created where a person, not being an Aborigine or a specified official, entered or remained upon a reserve120. The Full Court of the Federal Court observed that the only early attempt to regulate or proscribe entry by sea into an area adjacent to a reserve, made it an offence to enter the "territorial waters" adjacent to a reserve121. The term was not defined, was criticised for its uncertainty and was not re-enacted122. The Commonwealth Government established the Woodward Inquiry following upon the unsuccessful attempts by Aboriginal people to prevent bauxite mining and treatment on the Gove Peninsula in Arnhem Land. In Milirrpum v Nabalco Pty Ltd123 Blackburn J rejected the claim that their traditional rights in land had been unlawfully invaded by the mining company which had been granted mining rights by the Commonwealth Government. Brennan J observed in R v Toohey; Ex parte Meneling Station Pty Ltd124 that this judgment was the stimulus for the Inquiry. The Commissioner, Mr Justice A E Woodward, was appointed to inquire into and report upon the appropriate means to recognise and establish the traditional rights and interests of Aborigines in relation to land and to satisfy their reasonable aspirations to rights in or in relation to it and as to arrangements for vesting title to land in the Northern Territory then reserved for the use of Aboriginal inhabitants of the area125. Woodward J considered that the provision 119 Aboriginals Ordinance 1918 (NT); Welfare Ordinance 1953 (NT) and Social Welfare Ordinance 1964 (NT). 120 1918, s19; 1953, ss 44 and 45; 1964, s 17. 121 Aboriginals Ordinance, s 19AA. 122 Gumana v Northern Territory (2007) 158 FCR 349 at 364 [46]. 123 (1971) 17 FLR 141 (Supreme Court, NT). 124 (1982) 158 CLR 327 at 354; [1982] HCA 69. 125 Australia, Aboriginal Land Rights Commission, Second Report, April 1974 at [1] ("the Second Woodward Report"). of land might not only preserve the spiritual link of Aboriginal persons to their land, it might also be of economic benefit to them126. One of the key recommendations of the Commissioner's second report, of April 1974, was that land comprised in the reserves, including the Arnhem Land Reserve, should be vested in a body such as an incorporated trust127, which would hold the lands for the benefit of those Aborigines having traditional rights128. It was proposed that the Land Trust, with the consent of the regional Land Council, would be able to grant leases, licences and permits and, with the consent of the Minister, grant rights for the purposes of mineral or petroleum search or recovery, tourism and other approved purposes129. Regional Land Councils would conduct negotiations concerning the commercial use of the land130. It is to be recalled that the recommendations made in the Woodward reports occurred before recognition by the common law of native title131 and before provision was made by the Native Title Act 1993 (Cth) for statutory recognition and the determination of the existence of native title rights and interests. In relation to the title to the land to be granted under the proposed legislation Woodward J said that he regarded any form of leasehold title as inadequate132. He considered title expressed as fee simple to be preferable, and explained133: "I had suggested that these requirements could all be met by the creation of a new form of statutory title, to be known as Aboriginal Title, but I am reminded by a submission from the Northern Council that it is necessary to tread warily here. It is pointed out that if the title is expressed as being in fee simple, all the normal incidents of such title would be known. This would resolve any doubts about the applicability 126 Second Woodward Report at [3(iii), (iv)] and [4(d)]. 127 Second Woodward Report at [73], [90]. 128 Second Woodward Report at [95]. 129 Second Woodward Report at [144(x)]. 130 Second Woodward Report at [144(iii)]. 131 Mabo v Queensland [No 2] (1992) 175 CLR 1; [1992] HCA 23; Wik Peoples v Queensland (1996) 187 CLR 1; [1996] HCA 40. 132 Second Woodward Report at [70]. 133 Second Woodward Report at [72]. of the general law and facilitate any future dealing with the land, which may not be envisaged at present but which could be contemplated by later generations". Some difficulty was presented by the question of entry onto land. Woodward J observed that "[o]ne of the most important proofs of genuine Aboriginal ownership of land will be the right to exclude from it those who are not welcome". He agreed that it should be supported by a permit system, administered by officers of the Land Councils134. The recommendations in the report were said by the Commissioner largely to give effect to the submissions put by the Land Council. There were however three claims which he was unable to recommend be accepted in full. One of them was the extension of the reserve boundaries from the coastline to a distance of 12 miles out to sea135. He explained136: "I accept that Aborigines make traditional claims to most, and probably all, off-shore islands. Their legends link those islands with the mainland because of the passage of mythical beings from one to the other. The effect of this is that the sea between also has significance. Certainly Aborigines generally regard estuaries, bays and waters immediately adjacent to the shore line as being part of their land. However I am unable to endorse a claim to an area of sea as great as twelve miles from the coast. It seems to me that the legitimate interests of Aborigines will be protected if their traditional fishing rights are preserved and their right to the privacy of their land is clearly recognized by the establishment of a buffer zone of sea which cannot legally be entered by commercial fishermen or holiday makers. An exception would have to be made in cases of emergency. To establish these principles some arbitrary figure has to be arrived at, which I have already suggested (para 91) might be two kilometres from low tide. Since all the fishing is done by netting or the use of hand-lines in comparatively shallow water, this should suffice for both the purposes to which I have referred." 134 Second Woodward Report at [109]. 135 Second Woodward Report at [11]. 136 Second Woodward Report at [422]-[424]. Woodward J recommended that the definition of Aboriginal land, where a coastline is involved, should include off-shore islands and waters within two kilometres of the low tide line137. Neither report referred to the question of fishing rights, other than those of the traditional inhabitants. The references that were made to fishing generally assumed that any rules and restrictions applying to protect fish stocks would apply to Aboriginal fishing138. The possibility that the Land Council might license commercial fishing was discussed, but was not the subject of a recommendation139. The legislative response – the Land Rights Act The original Aboriginal Land (Northern Territory) Bill 1975 (Cth) more closely reflected the aspirations of the Second Woodward Report. It had not been passed when the Parliament was prorogued on 11 November 1975. The new government introduced and read two Bills ("the 1976 Bills"). The first140 was the subject of significant amendments which were ultimately incorporated into the Aboriginal Land Rights (Northern Territory) Bill 1976 [No 2] (Cth). In the 1975 Bill the function of the Aboriginal Land Commissioner, to be appointed under the proposed Land Rights Act to deal with claims to land, was to inquire not only into the desirability of securing land for the use of its traditional owners, but to ascertain and report to the Minister on land which might satisfy the needs of Aboriginal people141. In the Second Reading Speech for the first of the 1976 Bills the Minister for Aboriginal Affairs referred to "the predominant position of the traditional owners" as now being defined and suggested that this had not been made clear in the 1975 Bill142. The focus of the Land Rights Act, upon the recognition and protection of traditional land rights, is apparent from many of its provisions. 137 Second Woodward Report at [91]. 138 Second Woodward Report at [426]-[427]. 139 Second Woodward Report at [429]-[430]. 140 Aboriginal Land Rights (Northern Territory) Bill 1976 (Cth). 141 Aboriginal Land (Northern Territory) Bill 1975, cl 5. 142 Australia, House of Representatives, Parliamentary Debates (Hansard), 4 June Section 50(1)(a) of the Land Rights Act provides that an application may be made to an Aboriginal Land Commissioner by or on behalf of Aboriginals "claiming to have a traditional land claim" to an area of land. That land must be Crown land. The general definition of "Crown land" is "land in the Northern Territory"143. The report by the Commissioner to the responsible Minister, in connection with a claim, is required to have regard to the strength of the traditional attachment of the claimants to the land144. "Traditional Aboriginal owners", in relation to land, is defined to mean a local descent group of Aboriginals who have common spiritual affiliations to the land and are entitled by Aboriginal tradition to forage as of right over the land145. A grant of land may be made to an Aboriginal Land Trust on the recommendation of the Minister146. Aboriginal Land Trusts established under the Land Rights Act are to "hold title to land in the Northern Territory for the benefit of Aboriginals entitled by Aboriginal tradition to the use or occupation of the land concerned"147. Whilst the focus of the Bill as enacted shifted to the protection and maintenance of traditional uses of the land, the basic model of landholding recommended in the Second Woodward Report is retained in the Land Rights Act. A grant of land under the Act is to be of an estate in fee simple148 to a Land Trust, which holds the title as trustee149. A deed of grant may be registered, according to its tenor150. The Deeds of Grant in question are expressed to be subject to the provisions of the Act. The Land Rights Act protects pre-existing rights of use and occupation151. It reserves certain rights and requires them to be expressed in a grant. The rights to minerals which are vested in the Commonwealth or the Northern Territory 146 ss 10 and 12. 148 ss 10(1) and 12(1). 149 s 5(1)(a) and (b). 151 eg by the Director of National Parks, s 12A; the Crown or a public authority, s 14; missions, s 18; and the mining company operating the Ranger mine, s 18A. remain with them152. Provision is made for the grant of licences to explore for or mine minerals153. A grant is required to exclude roads over which the public has a right of way154. The Land Rights Act refers to a Land Trust as exercising its powers as owner of the land155. Section 19(1), however, provides that "[e]xcept as provided by this section or section 19A or 20, a Land Trust shall not deal with or dispose of, or agree to deal with or dispose of, any estate or interest in land vested in it". Section 19A refers to the grant of a head lease over a township and s 20 to leases in compliance with obligations of the Commonwealth. The ability of the Land Trust to deal with interests in the land less than freehold interests is further regulated by s 19. That section permits the grant of an estate or interest in the land by a Land Trust to certain persons and for specified purposes156 or the grant of an estate or interest in the land for any purpose at the direction of the Land Council and with the consent of the Minister, although consent is not necessary where the term created is less than 40 years157. An estate or interest in land includes a licence granted in respect of that land158. The Land Rights Act deals expressly with the control of entry upon Aboriginal land. Provision is made for a Land Trust, at the direction of the relevant Land Council, to authorise entry upon Aboriginal land for a specified purpose that is related to an estate or interest which it has granted159. Section 69 contains a prohibition upon a person entering or remaining upon land in the Northern Territory that is a sacred site. The general provision with respect to entry upon land the subject of the grant is s 70(1). It assumes importance on the appeal. It provides that "[a] person shall not enter or remain on Aboriginal land". "Aboriginal land" is relevantly defined160 to mean "land held by a Land Trust for 152 s 12(2)(a) and (b). 153 s 12(2)(c). Agreement must be reached with a Land Council for such a licence: 154 s 12(3) and (3A). 155 s 5(1)(a) and (b). 156 s 19(2) and (3). 157 s 19(4A) and (7). 160 By s 3. an estate in fee simple". An exception is provided by sub-s (2) where a person has an estate or interest in the land161. Sub-section (4) entitles a person to enter and cross Aboriginal land for the purpose of access to land in which they have an estate or interest, where there is no other practical way of gaining access to it. It is a defence, in proceedings for an offence under sub-s (1), that the person enters or remains on the Aboriginal land, "in performing functions under this Act or otherwise in accordance with this Act or a law of the Northern Territory"162. Section 73 is of particular significance to the issues on the appeal. It is entitled "Reciprocal legislation of the Northern Territory". No reference will be found to the matters for which it provides in the Woodward reports. It gives law- making power to the Legislative Assembly of the Northern Territory with respect to the protection of sacred sites and for the protection of wildlife, including wildlife on Aboriginal land163. Importantly, for present purposes, it gives power to make laws with respect to entry upon Aboriginal land and the waters of the sea adjoining that land in these terms: "(1) The power of the Legislative Assembly of the Northern Territory under the Northern Territory (Self-Government) Act 1978 in relation to the making of laws extends to the making of: laws regulating or authorizing the entry of persons on Aboriginal land, but so that any such laws shall provide for the right of Aboriginals to enter such land in accordance with Aboriginal tradition; laws regulating or prohibiting the entry of persons into, or controlling fishing or other activities in, waters of the sea, including waters of the territorial sea of Australia, adjoining, and within 2 kilometres of, Aboriginal land, but so that any such laws shall provide for the right of Aboriginals to enter, and use the resources of, those waters in accordance with Aboriginal tradition; 161 This includes a mining interest: s 66. 162 sub-s 2A. 163 s 73(1)(a) and (c). but any such law has effect to the extent only that it is capable of operating concurrently with the laws of the Commonwealth, and, in particular, with this Act, Division 4 of Part 15 of the Environment Protection and Biodiversity Conservation Act 1999 and any regulations made, schemes or programs formulated or things done, under this Act, or under or for the purposes of that Division." Sections 73(1)(d) and 74A(1) are the only provisions in the Land Rights Act which refer to fishing and to the waters of the sea. Section 74A(1) refers to financial assistance which might be given for legal representation of persons in connection with an inquiry, by an Aboriginal Land Commissioner, into the regulation and prohibition of entry of persons into or the control of fishing or activities in waters of the sea, in terms which mirror s 73(1)(d). Such an inquiry may be one to close the seas in an area. These inquiries have been held since the coming into effect of the Aboriginal Land Act (NT) ("the Aboriginal Land Act"), to which reference will shortly be made. The original Land Rights Bill, introduced into the Parliament in 1975, did not contain the clause which became s 73. It proposed giving effect to the Second Woodward Report by providing that that part of the territorial sea that is within two kilometres of the boundary of Aboriginal land should be deemed to be part of that land164. The Bill contained only one provision relating to entry onto Aboriginal land, a clause in the same terms as the present s 70. If it had been enacted the result would have been that entry onto the land the subject of the grant or into the sea "buffer zone" would have been prohibited. That situation changed with the change of government. The Bill for what became the Land Rights Act165 did not provide for a "buffer zone" but instead provided legislative powers to the Northern Territory in what would become s 73. Speaking of the amendments proposed to the first of the 1976 Bills166, the Minister said167: "I indicated in introducing the Bill that some relevant matters were to be covered by complementary legislation: The protection of sacred sites and wildlife in Aboriginal lands and the control of entry into those lands and adjacent the Northern Territory Legislative Assembly 164 Aboriginal Land (Northern Territory) Bill 1975, cl 74. 165 Aboriginal Land Rights (Northern Territory) Bill 1976 [No 2]. 166 Aboriginal Land Rights (Northern Territory) Bill 1976 (Cth). 167 Australia, House of Representatives, Parliamentary Debates (Hansard), 17 November 1976 at 2780. waters. It is now intended to spell out in the Bill, however, guidelines stipulating the kind of laws which should be made by the Legislative Assembly, and to guarantee recognition in those laws of traditional rights." The Minister also said that it was intended that the complementary legislation provide for Land Councils to be involved in arrangements for entry onto Aboriginal land, for wildlife conservation and the protection of sacred sites.168 In Risk v Northern Territory it was observed that attempts to amend the final Bill, by reintroducing the recommendation of the Woodward report, were rejected169. The response of the Northern Territory Legislative Assembly to s 73 was the Aboriginal Sacred Sites Ordinance 1978 (NT)170 (pursuant to s 73(1)(a)), the Aboriginal Land Ordinance 1978 (NT) (pursuant to s 73(1)(b) and (d)) and the Territory Parks and Wildlife Conservation Ordinance 1977 (NT) (pursuant to s 73(1)(c)). The Land Rights Act came into effect on 26 January 1977, save for s 70. The Northern Territory gained self-government, a matter which had been under discussion for some time, on 1 July 1978171. On 1 January 1979 the Aboriginal Land Ordinance 1978 (NT), which became the Aboriginal Land Act, came into effect172. Section 70 of the Land Rights Act commenced on the same date. The Aboriginal Land Act In the Aboriginal Land Act "Aboriginal land" is given the same meaning as in the Land Rights Act173. Part II deals with "Entry onto Aboriginal Land". It provides that a person, other than an Aboriginal entitled by Aboriginal tradition, shall not enter or remain upon Aboriginal land unless that person has been issued with a permit to do so174. The Land Council or the traditional Aboriginal owners 168 Australia, House of Representatives, Parliamentary Debates (Hansard), 17 November 1976 at 2779. 169 (2002) 210 CLR 392 at 406 [35] per Gleeson CJ, Gaudron, Kirby and Hayne JJ; 420-421 [86]-[87] per Gummow J ("the legislative compromise"); [2002] HCA 23. 170 Repealed in 1989 and replaced with the Northern Territory Aboriginal Sacred Sites Act (NT). 171 Northern Territory (Self-Government) Act 1978 (Cth). 172 The name was amended by the Statute Law Revision Act (NT). 173 Aboriginal Land Act, s 3. 174 s 4(1), (2) and (3). for the area may issue permits175 to a person to enter and remain upon Aboriginal land or to use a road that is bordered by that land. Part III deals with "Control of Entry onto Seas Adjoining Aboriginal Land". Section 12(1) provides: "The Administrator may, by notice in the Gazette, close the seas adjoining and within 2 kilometres of Aboriginal land to any persons or classes of person, or for any purpose other than to Aboriginals who are entitled by Aboriginal tradition to enter and use those seas and who enter and use those seas in accordance with Aboriginal tradition." Before deciding to close a part of the seas in accordance with the section the Administrator is to refer the matter to the Aboriginal Land Commissioner and request a report176. That report is to deal, amongst other things, with whether the use of those seas by strangers may interfere with the use of those seas in accordance with Aboriginal tradition by the Aboriginals who traditionally use those seas; whether a person would be disadvantaged if the seas were closed; and the commercial, environmental and recreational interests of the public177. Section 13 allows the Administrator to re-open seas which have been closed. Control of entry onto land and waters The owner of intertidal lands has the exclusive right of fishing in the waters overlying the lands and to grant that right to another178. The argument before the Full Court involved whether that right was subjugated to the paramount right of the public to fish in public waters, which is recognised by the common law179. That public right is amenable to abrogation or regulation by statute180. The issue identified by their Honours, the resolution of which would answer this question, was whether the Land Trust had the right to exclude the public from entry upon the land and the taking of fish from the waters above it181. 175 s 5(1) and (2). 177 s 12(3)(b), (d) and (e). 178 Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 329-330 per Brennan J; [1989] HCA 47, referring to Attorney-General for British Columbia v Attorney-General for Canada [1914] AC 153 at 167-168, 170. 179 Harper (1989) 168 CLR 314 at 330; public rights also extend to navigation, a right of way over tidal waters; see Halsbury Laws of England, 4th ed, vol 18 at [604]. 180 (2007) 158 FCR 349 at 374 [94]. 181 (2007) 158 FCR 349 at 373 [92]. Their Honours clearly considered that whatever rights the Land Trust had with respect to fishing in the waters were inextricably linked with its right to exclude. The view taken by their Honours was that the Land Rights Act both recognised and enforced such a right and it was effective to abrogate any public rights to fish, assuming that they existed182. The Full Court did not determine the question in favour of the Land Trust by reference to the grant to it of an estate in fee simple of the intertidal lands alone183, although the grant nonetheless assumes importance in their Honours' reasoning. It is apparent that their Honours considered that the Land Rights Act, in its purposes and its provisions, provides a statutory acknowledgment of the Land Trust's right, as owner, to exclude entry184. Section 70 was considered to be of "decisive significance" by their Honours, its language reflecting and reinforcing the extent of the Land Trust's rights185. It did not admit of a qualification that would exempt a person purporting to exercise a public right to fish in the tidal zone186. The public rights asserted had no place in the legislative scheme of that Act, their Honours concluded187. In arriving at that opinion their Honours saw s 70, and other provisions of the Act, as furthering the recommendations in the Second Woodward Report, which addressed directly the question of entry onto Aboriginal land188. It will be recalled that Woodward J identified the power of exclusion as an important incident of the Aboriginal ownership to be dealt with in the legislation189. It is necessary to consider whether the Land Rights Act gives effect to that recommendation or whether it altered that right, as it did with other incidents of a Land Trust's ownership, by itself providing for control of entry. 182 (2007) 158 FCR 349 at 375 [100]. 183 (2007) 158 FCR 349 at 372 [88]. 184 (2007) 158 FCR 349 at 372 [90], 373 [92], 374 [94]. 185 (2007) 158 FCR 349 at 374 [94]. 186 (2007) 158 FCR 349 at 374 [94]. 187 (2007) 158 FCR 349 at 375 [99]. 188 (2007) 158 FCR 349 at 375 [99]. 189 Second Woodward Report at [109]. The fee simple is the largest estate in land. It has come to resemble ownership and its proprietor is commonly called the owner of the land190. It is, for almost all practical purposes, the equivalent of full ownership of land191. This does not mean that it cannot be the subject of encumbrances192. The fee simple estate is different from traditional Aboriginal ownership of land, which has been described as "primarily a spiritual affair rather than a bundle of rights"193. It may be inferred that Woodward J chose the fee simple title as the subject of a grant under the proposed legislation for the security and certainty it would provide and because he foresaw the possibility of future dealings in the land. It is apparent from a number of provisions of the Land Rights Act that the rights of a Land Trust as owner of the land the subject of a grant are modified. The grant itself describes the estate or interest in the land as being in fee simple subject to the provisions of the Act. It is that interest which is the subject of registration. It was always intended that the estate or interest the subject of the grant would not completely accord with one of fee simple. This may be seen by the denial of that estate's essential characteristic, alienability. This was one of the recommendations of Woodward J. The Land Rights Act, as passed, contained further reservations with respect to the land and exclusions which altered the incidents of ownership. It provides for the continuing rights of third parties. It makes detailed provisions restricting and regulating such dealings as there may be in leasehold and other interests. It provides for the making of laws to protect sites and wildlife on the land and provides for the control of entry onto Aboriginal land and waters of the sea. In Davies v Littlejohn194 Isaacs J said that the statute there in question shaped and stated the characteristics of the tenure it created. Although his Honour was not speaking of a statute which permits the grant of land according 190 Megarry and Wade, The Law of Real Property, 6th ed (2000) at 2.16. 191 Fejo v Northern Territory (1998) 195 CLR 96 at 126 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [1998] HCA 58; Nullagine Investments Pty Ltd v Western Australian Club Inc (1993) 177 CLR 635 at 656 per Deane, Dawson and Gaudron JJ; [1993] HCA 45; Mabo v Queensland [No 2] (1992) 175 CLR 1 at 80 per Deane and Gaudron JJ. 192 See Challis's Law of Real Property, 3rd ed (1911) at 218-219. 193 R v Toohey; Ex parte Meneling Station Pty Ltd (1982) 158 CLR 327 at 358 per 194 (1923) 34 CLR 174 at 187; [1923] HCA 64. to an estate known to land law, as is here the case, the statement of the effect of statutory provisions is appropriate to a grant of an estate in fee simple with the reservations and exceptions made by the Land Rights Act. As Gummow J pointed out in Wik Peoples v Queensland195, whilst a statute may appear to adopt general law elements and principles in a new regime, in truth it may be seen to do so only on particular terms. These restrictions, and the assumption of control over the lands the subject of a grant, are not contrary to the purposes of the Land Rights Act. Its overall purpose is declared by its long title to be to benefit Aboriginal people, as the Full Court observed196. It is evident from the provisions of the Act that it does so by recognising and protecting traditional rights of use with respect to the land. This extends to the protection of such rights with respect to waters of the sea adjoining Aboriginal lands by s 73(1)(d). The Act also provides for the creation of some interests in the land by the Land Trust, albeit regulated, and that Land Councils might benefit by activities such as mining upon the land197. These powers may not be as extensive as envisaged by Woodward J. The objectives of the Act do not require that the Land Trust be able to exercise all of the powers of an owner. The later inclusion of s 73 shows a legislative intention to leave many such matters as issues of governance by the Northern Territory, so long as traditional rights of use are protected. It would not therefore seem to be a correct approach, to the question of the Land Trust's power to exclude or authorise entry, to view it as an owner, assume that it retains the powers of an owner and read the statute in this light. Regard must be had to the provisions of the Land Rights Act and as to how the matter of entry is there dealt with. There is a specific reference, in s 19(13), to the Land Trust being able to authorise persons to enter or remain upon Aboriginal land. It arises when it has granted an estate or interest in the land of the kind permitted by s 19 and pursuant to its requirements. The authority is limited to the purpose that is related to that estate or interest. A licence in respect of land is such an interest (s 19(13)). It was this provision to which the Full Court referred in connection with the possible authorisation of persons, by the Land Trust, to enter upon the foreshore and to fish there. Section 19(13) does not refer to that activity. Neither it nor s 19(11) provides a power of general permission or prohibition to a Land Trust. 195 (1996) 187 CLR 1 at 197. 196 Gumana v Northern Territory (2007) 158 FCR 349 at 375 [99]. 197 See in particular Pt IV "Mining". Section 70(1) contains the general prohibition of entry onto Aboriginal land. It does not reinforce the existence of an authority, on the part of the Land Trust as owner, to exclude entry onto Aboriginal land. It does not, for example, state that there shall be no entry and no person shall remain upon the land without the permission of the owner. It assumes the power to control entry and exercises it by the express prohibition in the section, in the way that entry has historically been denied to reserves. And s 70 creates an offence in the event of entry. The likelihood that s 70 was intended to support a Land Trust's power as owner is further diminished by the provision for the making of Northern Territory laws with respect to entry upon land in s 73(1)(b). Section 73(1)(b) provides that the Legislative Assembly of the Northern Territory may make laws which regulate or authorize the entry of persons onto Aboriginal land. It is addressed to the same subject as s 70. Section 73(1)(a), which permits the making of laws to protect and regulate or authorise the entry of persons onto sacred sites, is similarly addressed to the subject of s 69. In argument on the appeal it was suggested that it would be a defence to s 70(1) if a person entered upon Aboriginal land in accordance with a law of the Northern Territory of the kind referred to in s 73(1)(b), by reason of s 70(2A). Such an approach assumes that the prohibition in s 70 remains operative when laws of the kind referred to in s 73(1)(b) have been enacted. The defence would then afford an excuse. A preferable approach would be to construe s 70(1) together with s 73(1)(b). The language and structure of the sections strongly suggest this, as does their legislative history. They should be construed on the basis that they are intended to give effect to harmonious goals198. That objective is not achieved by reading the Act to provide for the making of laws which authorise or regulate entry onto land, and at the same time give effect to a prohibition on entry. It is achieved by reading s 70(1) as subject to the qualification that, where laws of the kind referred to in s 73(1)(b) are made, an exception is created to s 70. Such a statutory provision or effect is not uncommon199. If no such laws exist, the prohibition is effective. At present such laws do exist, those in Pt II of the Aboriginal Land Act. The effect is that s 70(1) is not contravened and no offence is committed. The Land Trust does not have the right of an owner to exclude persons from the land the subject of the grant. Section 70 does not give effect to such a right. The provisions of the Land Rights Act have altered that right. The effect of s 70, together with laws of the kind referred to in s 73(1)(b), is that entry is not 198 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [70] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28. 199 See eg Corporations Act 2001 (Cth), s 5G(4). prohibited where there is a scheme of regulation or authorisation under a Northern Territory law. That is provided by s 5(1) and (2) of the Aboriginal Land Act, which give power to the Land Council, and the traditional Aboriginal owners of an area, to issue permits for entry. The recommendation to that effect in the Second Woodward Report is implemented. Both s 70 and Pt II of the Aboriginal Land Act are concerned with "Aboriginal land" as it is defined in the Land Rights Act. The word "land" is not defined by the Act. If Aboriginal land extends to waters over the intertidal zone, s 70 is not presently effective to render entry upon them unlawful. If those waters are included in Aboriginal land, entry upon them is subject to a permission which may be granted under the Aboriginal Land Act. Any question concerning the regulation of any extant public right to fish must be considered in that context. There is, however, a question whether the term "Aboriginal land" is intended to include those waters. If it does not, the question then arises whether fishing in waters in the intertidal zone is regulated by laws made by reference to s 73(1)(d), namely Part III of the Aboriginal Land Act. Their Honours in the Full Court held that, if the waters are Aboriginal land, the power granted by s 73(1)(b), to enact laws regulating entry of persons on Aboriginal land, does not extend to a power to make laws with respect to fishing. This activity is dealt with by s 73(1)(d)200. Their Honours recognise the distinction made, in s 73, between Aboriginal land and waters of the sea. Their Honours, however, considered that the laws which could be made under s 73(1)(d) were not intended to operate with respect to waters lying over Aboriginal land in that zone. They saw s 73(1)(d), in its reference to waters of the sea, as "including waters of the territorial sea of Australia, adjoining, and within 2 kilometres of, Aboriginal land" as giving effect to the buffer zone which had been recommended in the Second Woodward Report, although the waters are not called Aboriginal land in the Land Rights Act201. Their Honours were influenced to their conclusion by the view that s 73(1)(d) presupposes a particular boundary with Aboriginal land, for otherwise the two kilometre zone would move with the tide202. Their Honours took that boundary to be that of the grant. Section 73(1)(d) is not without its difficulties in interpretation. If the Full Court's construction were the correct one it would mean that laws of the kind referred to in s 73(1)(d), such as the sea closure provisions in Pt III of the 200 (2007) 158 FCR 349 at 376 [103]. 201 (2007) 158 FCR 349 at 376 [103]. 202 (2007) 158 FCR 349 at 373 [94]. Aboriginal Land Act, would operate from the low water mark, but there would be no such regime for waters when they inundate the intertidal zone. It would suggest the retention of an exclusive right in the Land Trust to fishing in the waters over the zone when it does not have the right to control entry to the land under the waters. The Act contains no reference to such a right pertaining to those waters. It does not provide for the Land Trust dealing with such a right, whereas it makes detailed provision with respect to land. The Act does not itself assume control of entry of persons onto those waters or regulate to prohibit fishing in them, it makes provision for that control in s 73(1)(d). Section 73 is a clear expression of statutory intention that entry onto Aboriginal land and sacred sites on that land, the protection of wildlife on Aboriginal land and entry onto waters of the sea adjoining them are matters which can be dealt with by the Legislative Assembly of the Northern Territory. That legislature has done so. In providing for that legislative jurisdiction s 73 requires that such laws protect traditional Aboriginal rights of access and use. By that means the legislation would operate consistently with the principal purpose of the Land Rights Act. "Land" is ordinarily understood to be the solid part of the earth's surface, as distinguished from the sea203. Apart from s 73(1)(d)204, the provisions of the Land Rights Act concern land in this sense. This was observed in the joint judgment in Risk205. A number of provisions indicate that this is the case. They include provisions concerning the occupation of the land206, the extraction of minerals from it207, and roads constructed upon it208. The title given by a grant is referable to land. The grant is made in recognition, in part, of an Aboriginal group's traditional right to forage. As McHugh J noted in Risk209, the more natural meaning of that word involves the search for food on land. An application for a grant is with respect to Crown land, which is defined by the Act as land in the Northern Territory. Sections 73(1)(d) and 74A(1) are the only provisions in the Land Rights Act which refer to sea waters or to fishing. Section 73(1)(d) draws a clear 203 The Shorter Oxford English Dictionary, 3rd ed (rev) (1973), vol 1 at 1172. 204 and s 74A(1). 205 (2002) 210 CLR 392 at 404 [27] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 206 See above at fn 151. 207 Land Rights Act, s 12 and Pt IV. 208 Land Rights Act, s 12(3). 209 (2002) 210 CLR 392 at 413 [62]. distinction between Aboriginal land and waters of the sea. This distinction was adverted to in Risk210, in connection with the question whether the words "land in the Northern Territory" include the seabed. It was held that it did not. McHugh J observed that s 73(1)(d) operates upon the assumption that the "waters of the sea" are not Aboriginal land within the meaning of s 3 of the Act and therefore not the subject of an application under s 50211. Callinan J was also of the view that the reference to land in the Act did not include the sea212. This accords with the treatment elsewhere in the Act of Aboriginal land as land in the ordinary sense of the term. Reading "Aboriginal land" as referrable to land over which tidal waters do not flow, dry land in that sense, gives effect to the distinction between land and waters in their ordinary and natural meaning. "Waters of the sea" would ordinarily be understood to refer to all such waters, regardless of whether they cover tidal lands at times213. Such a construction of s 73(1)(d) would not deny the meaning of Aboriginal land as referable to land the subject of the grant, as it is defined. It would maintain the distinction created by the section. It would give effect more fully to the meaning of the term "waters of the sea". I observe that in sea closure determinations the term has been taken to include waters which overlie the boundaries of Aboriginal land214. The application of the construction would take the two kilometre zone, the subject of the powers of closure under the Aboriginal Land Act, from the high water and not the low water mark. The waters of the sea would be taken to adjoin Aboriginal land which was not inundated by waters from time to time. McHugh J in Risk appears to have assumed that the line should be taken from the low water mark, but it was not necessary to the matter decided and his Honour was not required to consider the operation of s 73(1)(d). It is not necessary to the purposes of control of entry for fishing and other activities in waters of the sea that a line be taken from the boundary of the grant land. To the contrary, it would achieve no statutory purpose and run counter to the purpose of the protection of traditional rights to fish. The Land Rights Act 210 (2002) 210 CLR 392 at 404 [26] per Gleeson CJ, Gaudron, Kirby and Hayne JJ, 412-413 [61] per McHugh J. 211 (2002) 210 CLR 392 at 412-413 [61]. 212 (2002) 210 CLR 392 at 434 [117], 435-436 [123]-[125]. 213 See reasons of Heydon J at fn 69. 214 Closure of Seas: Castlereagh Bay/Howard Island Region of Arnhem Land, Report by Aboriginal Land Commissioner Justice Kearney to the Administrator of the Northern Territory (1 July 1988) at 17-18 [81]. did not establish the buffer zone referred to in the Woodward reports, one which extended from the boundary of the grant and which included the sea as part of Aboriginal land. It did not identify that boundary as a point of reference. It drew a distinction between waters of the sea and Aboriginal land, which is to say land the subject of the grant. It is unlikely that the legislation enacted pursuant to s 73(1)(d) was not intended to apply to waters over intertidal zones. One regime is likely to have been intended with respect to all waters of the sea. This was the view expressed by Mansfield J in Arnhemland Aboriginal Land Trust v Director of Fisheries Conclusion The issues on the appeal fall to be determined by reference to the provisions of the Land Rights Act. That Act does not provide for the control of entry onto intertidal waters or activities such as fishing by the Land Trust. It provides the foundation for a further statutory regime, Northern Territory laws, which may prohibit or regulate those activities. Part III of the Aboriginal Land Act is such a law. Absent a closure effected pursuant to s 12 it is not unlawful for persons, otherwise entitled to take fish, to fish there. It is not necessary to determine the question whether persons have a right to fish in open waters by reason of the ancient public right, or because of the common law principle that a person is free to do anything, subject only to the provisions of the law216. One such provision, where a person is not an Aboriginal exercising a traditional right to fish217 or a person taking fish for their subsistence or personal use,218 requires that a licence be obtained under the Fisheries Act219. That Act does not provide for permission to fish in particular areas and is of limited relevance to the issues on the appeal. The terms of a licence under the Fisheries Act may exclude fishing in certain areas, notably areas the subject of fishing management plans220. There is no suggestion that the tidal zones in 215 (2000) 170 ALR 1 at 11 [33]-[35]. 216 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 564; [1997] HCA 25. 217 Fisheries Act, s 53. 218 Fisheries Act, s 10(2). question are subject to such plans. A person taking fish in compliance with the terms of the Act, or a licence issued under it, is entitled to do so in the intertidal zones in question, in the absence of an exclusion effected under the Aboriginal Land Act. The Land Trust does not have the right to exclude the public from that use. Orders I would allow the appeal, set aside the declarations, make declarations as to the meaning of the terms "Aboriginal land" and "waters of the sea", make a declaration to the effect that the Land Trust does not have the power to exclude persons from fishing in intertidal zones and declare that the power to do so is contained in Pt III of the Aboriginal Land Act. On the grant of special leave the appellant undertook to pay the costs of the first, second and third respondents. There should be an order accordingly.
HIGH COURT OF AUSTRALIA Matter No H2/2021 HOBART INTERNATIONAL AIRPORT PTY LTD APPELLANT AND CLARENCE CITY COUNCIL & ANOR RESPONDENTS Matter No H3/2021 PTY LTD APPELLANT AND NORTHERN MIDLANDS COUNCIL & ANOR RESPONDENTS Hobart International Airport Pty Ltd v Clarence City Council Australia Pacific Airports (Launceston) Pty Ltd v Northern Midlands Council [2022] HCA 5 Date of Hearing: 12 October 2021 Date of Judgment: 9 March 2022 H2/2021 & H3/2021 ORDER In each matter: Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation K A Stern SC with L A Coleman for the appellant in each matter (instructed by Corrs Chambers Westgarth, Tierney Law and King & Wood Mallesons) S B McElwaine SC and K Cuthbertson for the first respondent in each matter (instructed by Simmons Wolfhagen) S P Donaghue QC, Solicitor-General of the Commonwealth, with C L Lenehan SC and K E Foley for the second respondent in each matter (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Hobart International Airport Pty Ltd v Clarence City Council Australia Pacific Airports (Launceston) Pty Ltd v Northern Midlands Council Constitutional Law (Cth) – Judicial power of Commonwealth – Meaning of "matter" – Where Commonwealth entered leases ("Leases") with operators of Hobart Airport and Launceston Airport ("Lessees") for Hobart Airport site and Launceston Airport site ("Airports") – Where Clarence City Council and Northern Midlands Council ("Councils") administer municipal area covering Airports – Where Airports not amenable to council rates or State land tax because located on Commonwealth land – Where cl 26.2(a) of Leases requires that, in lieu of rates, Lessees pay Councils amount that would have been payable if Airports not on Commonwealth land, but relevantly only in respect of parts of Airports on which "trading or financial operations are undertaken" – Where Lessees required to use "all reasonable endeavours" to enter agreements with Councils to make such payments – Where Commonwealth and Lessees not in dispute about meaning of cl 26.2(a) or Lessees' compliance with it – Where Councils not parties to Leases – Where Councils sought declaratory relief regarding proper construction of cl 26.2(a) and Lessees' obligations to make payments – Whether dispute involves "matter" for purposes of Ch III of Constitution – Whether dispute involves justiciable controversy – Whether Councils have standing to have dispute determined. Words and phrases – "all reasonable endeavours", "declaratory relief", "doctrine of privity", "federal jurisdiction", "heads of jurisdiction", "immediate right, duty or liability to be established", "judicial power of the Commonwealth", "justiciable controversy", "legally enforceable remedy", "material interest", "matter", "outsider to a contract", "private rights", "public rights", "real commercial interest", "real interest", "real practical importance", "special interest", "standing", "subject matter requirement", "sufficient interest", "third party", "trading or financial operations". Constitution, Ch III. Airports (Transitional) Act 1996 (Cth), s 22. KIEFEL CJ, KEANE AND GORDON JJ. The Hobart Airport site and the Launceston Airport site ("the Airports") are on Commonwealth land. They are not amenable to council rates or State land tax because s 114 of the Constitution prohibits States (without the consent of the Commonwealth Parliament) the from imposing "any Commonwealth"1. tax on property of any kind belonging The Clarence City Council administers the municipal area covering the eastern suburbs of Hobart and surrounding localities, including the Hobart Airport site. The Northern Midlands Council administers the municipal area extending from the south of Launceston to the Tasmanian central midlands, including the During the 1980s, most significant federal airports were operated by the Federal Airports Corporation ("the FAC") as government business enterprises2. There was "a long standing Government policy that the Commonwealth [would] make payments equivalent to rates to local authorities in certain circumstances"3. Notwithstanding that the FAC was exempt from paying taxes under any Commonwealth, State or Territory law4, the FAC agreed to maintain the Commonwealth Government's policy by "making payments in lieu of rates for areas [of federal airports] which were used for commercial activities and for which the [FAC] received an annual rent"5. The FAC paid the Clarence City Council See also s 52(i) of the Constitution, which relevantly confers exclusive power on the Commonwealth Parliament to make laws with respect to "all places acquired by the Commonwealth for public purposes". 2 Bartsch, Aviation Law in Australia, 5th ed (2019) at 596 [13.10]; Commonwealth, Auditor-General, Management of Airport Leases: Follow up, Audit Report No 25 Federal Airports Corporation, Policy Manual, Volume 8: Property Policy, Revision 1 (November 1995) at [4.6.1]. 4 Federal Airports Corporation Act 1986 (Cth), s 45(1). Federal Airports Corporation, Policy Manual, Volume 8: Property Policy, Revision 1 (November 1995) at [4.6.1]. Gordon "rates on an ex-gratia basis" in respect of the Hobart Airport6 and tenants at the Launceston Airport paid "rates directly to [the] Northern Midlands Council"7. On 11 April 1995, the Commonwealth and the States and Territories entered into the "Competition Principles Agreement"8 ("the CPA"), by which they recorded the agreement of the Council of Australian Governments to adopt certain principles of competition policy and to apply competition laws across the public sector9. One of the overarching purposes of the CPA was "to achieve and maintain consistent and complementary competition laws and policies which [would] apply to all businesses in Australia regardless of ownership"10. One of the principles agreed to in the CPA was the principle of "competitive neutrality", which cl 3 of the CPA described as "the elimination of resource allocation distortions arising out of the public ownership of entities engaged in significant business activities"11. During the late 1990s and early 2000s, the Commonwealth entered into a number of long-term leases with airport operators as part of a project to privatise Australia's ("the privatisation project"). Legislation federal airports12 6 Commonwealth, Phase 2 Federal Airports: Hobart Airport Information Memorandum (November 1997) at 56 [8.3.2]; see also 4. It seems that, after making ex-gratia payments in lieu of rates, the FAC passed on the rate notices to tenants of properties at the Hobart Airport to charge them for the amounts under the outgoings terms of their leases. 7 Commonwealth, Phase 2 Federal Airports: Launceston Airport Information Memorandum (November 1997) at 50 [8.3.2]. See Miller, Miller's Australian Competition Law and Policy, 3rd ed (2018) See Rail Access Corporation v New South Wales Minerals Council Ltd (1998) 87 FCR 517 at 518; Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR 379 at 409 [71]. 10 See Miller, Miller's Australian Competition Law and Policy, 3rd ed (2018) at 501. 11 See Miller, Miller's Australian Competition Law and Policy, 3rd ed (2018) at 503. 12 See Commonwealth, Auditor-General, Management of Federal Airport Leases, Audit Report No 50 2003-04 (2004) at 9 [1], [3], 27-29 [1.1]-[1.6]; Commonwealth, Auditor-General, Management of Airport Leases: Follow up, Gordon regulatory facilitate the privatisation project was enacted. The Airports Act 1996 (Cth) "establish[ed] the airports arrangements [then] owned and operated on behalf of the Commonwealth by the [FAC] ... following the leasing of those airports"13. The Airports (Transitional) Act 1996 (Cth) ("the Transitional Act") established "a framework [to give] effect to the Government's decision to lease all the Federal airports effectively as ongoing businesses with staff and management in place"14. The simplified outline of the apply the This Act provides for the leasing of certain airports. Airport land and other airport assets will be transferred from the [FAC] to the Commonwealth. The Commonwealth will grant an airport lease to a company. The company is called an airport-lessee company. Immediately after the grant of the airport lease, the Commonwealth may transfer or lease certain assets to the airport-lessee company. Certain employees, assets, contracts and liabilities of the FAC will be transferred to the airport-lessee company." At the time of the privatisation project, the Commonwealth sought to create a "level playing field" between the operators of newly privatised airports and their actual or potential competitors. The Commonwealth recognised that a competitive imbalance arose from the fact that the newly privatised airports were situated on Commonwealth land and, therefore, were not amenable to council rates or State land tax. Consistently with the Commonwealth's long-standing policy of making payments equivalent to rates in respect of federal airports, and in order to implement the principle of competitive neutrality agreed to in the CPA, Audit Report No 25 2006-07 Bartsch, Aviation Law in Australia, 5th ed (2019) at 598 [13.15]. 13 Australia, House of Representatives, Airports Bill 1996, Explanatory Memorandum 14 Australia, House of Representatives, Airports (Transitional) Bill 1996, Explanatory Memorandum at 9. 15 Transitional Act, s 3. Gordon the Commonwealth included in federal airport leases a term requiring lessees to pay to the relevant council a "fictional" or "notional" equivalent to the rates that would have been payable if the airport sites were not on Commonwealth land. These appeals are concerned with the following leases ("the Leases") granted by the Commonwealth pursuant to s 22 of the Transitional Act16: a lease between the Commonwealth and Hobart International Airport Pty Ltd ("HIAPL") (the operator of the Hobart Airport) for the Hobart Airport site dated 10 June 1998, which commenced on 11 June 1998, for a term of 50 years, with a 49-year option to renew; and a lease between the Commonwealth and Australia Pacific Airports (Launceston) Pty Ltd ("APAL") (the operator of the Launceston Airport) for the Launceston Airport site dated 28 May 1998, which commenced on 29 May 1998, also for a term of 50 years, with a 49-year option to renew. The Leases contain materially similar terms. The dispute giving rise to these appeals concerns cl 26, headed "Rates and Land Tax and Taxes". Clause 26.1 provides that "[t]he Lessee must pay, on or before the due date, all Rates, Land Tax and Taxes without contribution from the Lessor". Clause 26.2, headed "Ex Gratia Payment in Lieu of Rates and Land Tax", creates a mechanism whereby, if council rates and taxes are not payable by HIAPL and APAL ("the Lessees") because the Airports are situated on land owned by the Commonwealth, the relevant the Lessees must pay certain amounts "Governmental Authority" or the Commonwealth, as the case may be. Most relevantly for present purposes, cl 26.2(a) provides: "Where Rates[17] are not payable under sub-clause 26.1 because the Airport Site is owned by the Commonwealth, the Lessee must promptly pay to the 16 The Leases are governed by and construed in accordance with the laws of Tasmania: cl 30 of the Leases. In some Australian States and Territories, but not Tasmania, third parties may, in compliance with statutory requirements, enforce contractual promises made for their benefit by direct action: see Property Law Act 1974 (Qld), s 55; Property Law Act 1969 (WA), s 11; Law of Property Act 2000 (NT), s 56. 17 "Rates" is defined in cl 2.1 of the Leases to mean "all rates (including water rates and sewerage rates), and levies to defray expenses levied or imposed by a Governmental Authority on land or on owners or occupiers of land in relation to their ownership or occupation of that land". Gordon relevant Governmental Authority[18] such amount as may be notified to the Lessee by such Governmental Authority as being equivalent to the amount which would be payable for rates as if such rates were leviable or payable in respect of those parts of the Airport Site: which are sub-leased to tenants; or on which trading or financial operations are undertaken including but not limited to retail outlets and concessions, car parks and valet car parks, golf courses and turf farms, but excluding runways, taxiways, aprons, roads, vacant land, buffer zones and grass verges, and land identified in the airport Master Plan for these purposes, unless these areas are occupied by the Commonwealth or an authority constituted under Commonwealth law which is excluded from paying rates by Commonwealth policy or law. The Lessee must use all reasonable endeavours to enter into an agreement with the relevant Governmental Authority, body or person to make such payments." (emphasis added) The Clarence City Council and the Northern Midlands Council ("the Councils"), established under the Local Government Act 1993 (Tas)19, are respectively the relevant "Governmental Authority" for the Hobart Airport and the Launceston Airport. The Councils are not, and have never been, parties to the Leases. Between 1998 and 2013, there was no issue about the operation of cl 26.2(a). The Lessees made payments to the Councils in accordance with independent valuations of the Airports in each financial year. In the 2014 financial year, the Valuer-General for Tasmania ("the Valuer-General") undertook a re-valuation of the Airports. The outcome was a significant increase in the quantum of the equivalent amount payable by the Lessees to the Councils under cl 26.2(a) of the Leases. The Lessees objected to the valuation on the bases that the Valuer-General incorrectly identified the portions of the Airports on which trading or financial operations were undertaken to be included for calculating the amount payable under cl 26.2(a) (for example, by including common user areas of 18 "Governmental Authority" to mean "the Commonwealth government or any government of any State or Territory of Australia, administrative body, governmental body, department or agency of any such government or local government authority". in cl 2.1 of the Leases is defined 19 Local Government Act, s 18, Sch 3. Gordon the Airports, such as the check-in areas and departure lounges) and that the wrong methodology had been applied. provided ("HTW"). 2016, HTW Protracted correspondence and meetings subsequently ensued between the Lessees, the Councils and the Commonwealth in an effort to resolve the disagreement. The Commonwealth engaged an independent valuer, Herron Todd White report, which the Commonwealth considered accurately reflected the Lessees' obligations under cl 26.2(a). The Commonwealth told HIAPL that, because it had made payments to the Clarence City Council exceeding the amounts determined in the valuation report, it considered HIAPL had met its obligations under cl 26.2(a) for the years addressed by the valuation (namely, the 2014, 2015 and 2016 financial years). The Commonwealth told APAL that if it made payments to the Northern Midlands Council in line with the valuation report, it would consider APAL to have met its obligations under cl 26.2(a) for the 2014, 2015 and 2016 financial years, and APAL subsequently made payments accordingly. valuation In 2017, HTW provided a revised valuation report. HTW did not apply a value to the common user areas in the revised valuation. The Commonwealth informed the Lessees that "[g]oing forward", absent any formal agreement between the Councils and the Lessees, it would consider the Lessees compliant with their obligations under cl 26.2(a) if they made "payments in lieu of rates to [the Councils] on the basis of a valuation and methodology consistent with" the revised HTW valuation. The Commonwealth encouraged the Lessees to enter into negotiations with the Councils, "with a view to reaching mutually agreed the payment of ex-gratia rates for future years". arrangements around Subsequently, for the purposes of cl 26.2(a), the Lessees paid the Councils on the basis of the valuations and methodology set out in HTW's revised valuation for the 2017 and 2018 financial years. There was therefore no dispute between the parties to the Leases – the Commonwealth and the Lessees – about the operation of cl 26.2(a) or the Lessees' compliance with it. The Lessees and the Councils have not relevantly entered into any agreements about ex-gratia payments as contemplated by the final sentence of cl 26.2(a)20. The Councils, however, contended that the Valuer-General had correctly identified the portions of each Airport on which trading or financial operations 20 HIAPL and the Clarence City Council entered into an agreement dated 14 May 2004 which specified the basis upon which "Lease Compliance Payments" (as defined in that agreement) would be payable by HIAPL to the Clarence City Council. That agreement had a term of five years and was not renewed. Gordon were undertaken in calculating the equivalent quantum under cl 26.2(a) and applied the correct methodology. The Councils, therefore, did not accept that the Lessees' payments to them of amounts calculated in accordance with HTW's valuations (and not the higher amounts based on the Valuer-General's valuation) satisfied the Lessees' obligations under cl 26.2(a). The Councils then commenced proceedings in the Federal Court of Australia against the Commonwealth and the Lessees seeking, among other things, declaratory relief pursuant to s 21 of the Federal Court of Australia Act 1976 (Cth) with respect to the proper construction of cl 26.2(a) of the Leases and the Lessees' obligations to make payments pursuant to the Leases for the financial years for 2014/2015 to 2017/2018 inclusive. In substance, the Councils contended that the whole of each of the Airports is "rateable", except for the areas occupied by the Commonwealth or a Commonwealth authority or which comprise runways, taxiways, aprons, roads, vacant land, buffer zones and grassed verges, because "trading or financial operations" (within the meaning of cl 26.2(a)) are undertaken on all other areas of the Airports. The Lessees and the Commonwealth disagreed with the Councils' construction of the phrase "trading or financial operations". They contended, among other things, that when regard is had to the principle of competitive neutrality which was the rationale for cl 26.2(a), it is evident that "trading or financial operations" was not intended to apply to "aeronautical services and facilities" (which the Councils said were included in the rateable areas) on the basis that the Lessees could not enjoy a competitive advantage over such services and facilities where there was no comparable business. Throughout the proceedings, it has remained the position that the Commonwealth and the Lessees are not in dispute about the operation of cl 26.2(a) or the Lessees' compliance with that clause. Decisions below The primary judge dismissed the Councils' applications on the basis that the Councils lacked standing to obtain the declaratory relief sought. The Councils appealed to a Full Court of the Federal Court (Jagot, Kerr and Anderson JJ) on various grounds essentially directed to arguing that the Councils had standing to seek the declaratory relief in respect of the interpretation and application of the Leases. The Commonwealth's position was not materially different to that adopted by the Councils. The Lessees contended that the primary judge correctly found that the Councils did not have standing. They also filed notices of contention arguing, in Gordon the alternative, that the primary judge's decision should be affirmed on three grounds: (1) the Councils' claims did not involve a justiciable controversy so as to constitute a "matter" for the purposes of Ch III of the Constitution in respect of which the Federal Court had jurisdiction; (2) the Federal Court did not have original jurisdiction as any "matter" did not arise under any law made by the Commonwealth Parliament within the Judiciary Act 1903 (Cth); or (3) the Federal Court should decline to exercise its discretion to grant the relief sought by the Councils. The Full Court unanimously allowed the Councils' appeals, dismissed the Lessees' notices of contention and remitted the proceedings to the primary judge to determine whether the Councils should be granted the declaratory relief sought. the meaning of s 39B(1A)(c) of By grant of special leave, the Lessees appealed to this Court. Each of the Lessees contended that the proceeding to which it is a party does not involve a "matter" for the purposes of Ch III of the Constitution as there is no justiciable controversy to be quelled and the only rights, duties or liabilities to be established are the contractual rights, duties or liabilities of two contracting parties inter se between whom there is no dispute about the meaning or effect of the relevant lease. The Lessees also contended that the doctrine of privity of contract prevented the Councils from seeking declaratory relief regarding the interpretation or application of the Leases and that the Councils lacked standing. the meaning or effect of a contract, The Councils filed notices of contention contending that if the doctrine of privity of contract ordinarily prevents a third party from seeking declaratory relief about involves "exceptional circumstances" sufficient to establish standing or the Court should confine the doctrine so that it does not deny standing where the third party is a participant in respect of the contract. this case then Issue The dispute sought to be agitated by the Councils, which was the subject of the declaratory relief sought by the Councils, concerned the meaning of a contractual term – cl 26.2(a) of the Leases – and, specifically, the meaning of the phrase "trading or financial operations" ("the dispute"). The rights, duties and liabilities of the Commonwealth and the Lessees under cl 26.2(a) of the Leases lay at the heart of the dispute21. Although the rights, duties and liabilities in issue might be described as having a "public" dimension or complexion at least insofar as the In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 at 405-406 [62]. Gordon Leases were granted pursuant to statute and cl 26.2(a) gave effect to a governmental policy, they are nonetheless private law rights, duties and liabilities. The question in these appeals is whether the dispute involves a "matter" for the purposes of Ch III of the Constitution capable of determination by a court exercising the judicial power of the Commonwealth when the parties to the Leases – the Commonwealth and the Lessees – are not in dispute about the operation of cl 26.2(a) of the Leases or about the Lessees' compliance with that clause. Matter "Matter" has two elements: "the subject matter itself as defined by reference to the heads of jurisdiction set out in [Ch] III [of the Constitution], and the concrete or adequate adversarial nature of the dispute sufficient to give rise to a justiciable controversy"22. Subject matter The Councils' claims for declaratory relief satisfy the first element – the subject matter requirement. The rights and obligations of the Commonwealth and the Lessees under the Leases owe their existence to a Commonwealth law, the Transitional Act, such that the claims "aris[e] under" a Commonwealth law within s 76(ii) of the Constitution23. The fact that the Commonwealth is a party to the proceedings, within s 75(iii) of the Constitution, does not provide a separate basis for satisfying the subject matter requirement. Section 39B(1A) of the Judiciary Act does not invest federal jurisdiction in the Federal Court in relation to all matters within s 75(iii), only those in which "the Commonwealth is seeking an injunction or a 22 CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 351 [27], quoting Burmester, (eds), in Opeskin and Wheeler "Limitations on Federal Adjudication", The Australian Federal Judicial System (2000) 227 at 232. 23 See Judiciary Act, s 39B(1A)(c); R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141 at 154; LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581; Edwards v Santos Ltd (2011) 242 CLR Gordon declaration"24. In these proceedings, the Commonwealth does not seek such relief. The Commonwealth's submission to the contrary is rejected. Justiciable controversy Central to both the notions of judicial power and "matter" within Ch III of the Constitution is the second element – the requirement that the dispute involves a "justiciable controversy"25. The established position remains that "there can be no matter within the meaning of [ss 75 and 76 of the Constitution] unless there is some immediate right, duty or liability to be established by the determination of the Court"26. In these appeals, whether there is a justiciable controversy may be addressed by asking if the applicable principles permit the Councils to seek declaratory relief in relation to the dispute. That is, in these appeals (but not in all cases), the answer to the question of whether there is a justiciable controversy turns on whether the Councils have standing to have the dispute determined and to seek the declaratory relief sought. The question in these appeals can be approached in this way because, in federal jurisdiction, "questions of 'standing' to seek equitable remedies such as those of declaration and injunction, [when they arise,] are subsumed within the constitutional requirement of a 'matter'"27. The "significance of standing to the 24 Judiciary Act, s 39B(1A)(a). 25 Re Judiciary (1921) 29 CLR 257 at 265, 266-267; Fencott v Muller (1983) 152 CLR 570 at 603, 606, 608; Mellifont v Attorney-General (Qld) (1991) 173 CLR 289 at 303; Abebe v The Commonwealth (1999) 197 CLR 510 at 523-524 [22]-[25], 561 [140], 585 [215]; Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 606 [31]; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21-22 [54]; CGU Insurance (2016) 259 CLR 339 at 350 [26], 351 [27], 352 [29]; Palmer v Ayres (2017) 259 CLR 478 at 490-491 [26]-[27]. 26 Re Judiciary (1921) 29 CLR 257 at 265. 27 Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 68 [152]. See also Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 550-551; Croome v Tasmania (1997) 191 CLR 119 at 124-126, 132-136; Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 262 [37]; Truth About Motorways (2000) 200 CLR 591 at 610-613 [42]-[50], 629-633 [101]-[109], 659-660 [177]-[179]; Gordon existence of a matter for the purposes of Ch III"28 is, in essence, that there is no "matter" "unless there is a remedy available at the suit of the person instituting the proceedings in question"29. While "[a] negative answer to the question – is there a matter before the Court in which it has federal jurisdiction? – would render the question of the plaintiff's standing moot", "an affirmative answer to the question – is there a matter? – may not be sufficient to answer the question whether the plaintiff has standing"30. It may be that standing to seek relief ordinarily provides the "justiciable" aspect of the controversy, but it is unnecessary to determine whether, in every case where an applicant has "standing", there is necessarily a "justiciable controversy". It is for those reasons that the particular question in these appeals is whether the Councils have standing. What to establish "standing" varies depending on the relief sought31. Here, the Councils seek declaratory relief. The breadth of the jurisdiction to grant declaratory relief was considered by Gibbs J in Forster v Jododex Aust Pty Ltd32. The question must be real, not theoretical. There must be a proper contradictor – someone presently existing who has a true interest to oppose the declaration sought. And the applicant must is required Kuczborski v Queensland (2014) 254 CLR 51 at 60-61 [5], 87-88 [98]-[100], 28 Truth About Motorways (2000) 200 CLR 591 at 612 [47]. 29 Truth About Motorways (2000) 200 CLR 591 at 612 [48]; see also 612-613 30 Kuczborski (2014) 254 CLR 51 at 61 [5]. 31 Australian Conservation Foundation (1980) 146 CLR 493 at 511, quoted with approval in Bateman's Bay (1998) 194 CLR 247 at 266 [47], 282 [97]; Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 659 [68], quoting Allan v Transurban City Link Ltd (2001) 208 CLR 167 (1972) 127 CLR 421 at 437-438, quoting with approval Russian Commercial and Industrial Bank v British Bank for Foreign Trade [1921] 2 AC 438 at 448. See also Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 582, 596. Gordon have a "sufficient" or "real" interest in obtaining the relief33. There is no requirement that an applicant for declaratory relief have a cause of action in order to obtain it34. Those principles are not exhaustive35. These appeals turn on the nature and adequacy of the Councils' interest in the resolution of the dispute. Sufficient or real interest The requirement that an applicant for declaratory relief have a "sufficient" or "real" interest in obtaining the relief has work to do in both public and private law contexts. "However, the requirement applies differently to different sorts of controversies"36. In respect of private rights, the general principle is clear: an applicant for declaratory relief will have a "sufficient" or "real" interest in obtaining relief where it pertains to declaring the existence of legally enforceable rights or liabilities of the applicant, including statutory rights37. Here, the Councils did not assert that they had any legally enforceable contractual rights under the Leases or any 33 See Aussie Airlines Pty Ltd v Australian Airlines Ltd (1996) 68 FCR 406 at 414; Plaintiff M61/2010E v The Commonwealth (2010) 243 CLR 319 at 359 [103]; Santos (2011) 242 CLR 421 at 435 [36], 436 [37]-[38]; see also 425 [1]. 34 Plaintiff S10 (2012) 246 CLR 636 at 659 [68]. See also Guaranty Trust Co of New York v Hannay & Co [1915] 2 KB 536 at 572; J N Taylor Holdings Ltd (In liq) v Bond (1993) 59 SASR 432 at 435; Martin v Taylor [2000] FCA 1002 at [27]; Witzleb, Bant, Degeling and Barker, Remedies: Commentary and Materials, 6th ed (2015) at 1159. 35 See University of New South Wales v Moorhouse (1975) 133 CLR 1 at 10; Gardner v Dairy Industry Authority (NSW) (1977) 52 ALJR 180 at 188, 189; 18 ALR 55 at 69, 71; Ainsworth (1992) 175 CLR 564 at 581-582; Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 359 [56]; Gedeon v Commissioner of New South Wales Crime Commission (2008) 236 CLR 120 at 133 [23]. 36 Meagher, Gummow and Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 37 See Aussie Airlines (1996) 68 FCR 406 at 414; Bateman's Bay (1998) 194 CLR 247 at 264 [43]; Truth About Motorways (2000) 200 CLR 591 at 611-612 [46]; Santos (2011) 242 CLR 421 at 434 [34]; see also 425 [1]; CGU Insurance (2016) 259 CLR 339 at 357 [42], 371 [96], 376 [109]. Gordon statutory right which they could enforce and, at least in the proceedings below, they disavowed that they enjoyed the benefit of a contractual promise held on trust. Although lack of privity is a factor relevant to standing and a reason for a court approaching the question of the standing of an outsider with considerable caution38, an outsider to a contract may, "for other reasons"39 – what might be described as "exceptional circumstances"40 – have a "sufficient" or "real" interest to seek declaratory relief as to the meaning and effect of a contract between contracting parties. As the Full Court put it below, "there is reason to be concerned as to the potential for what might be described as unfounded intermeddling by a third party to a contract. But, in the context of declaratory relief, the solution to that concern is not the doctrine of privity of contract"41. 38 See Anderson v The Commonwealth (1932) 47 CLR 50 at 51; Meadows Indemnity Co Ltd v Insurance Corporation of Ireland Plc [1989] 2 Lloyd's Rep 298 at 309; Employers Reinsurance Corporation v Ashmere Cove Pty Ltd (2008) 166 FCR 398 at 410-412 [49]-[62]; Meagher, Gummow and Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 630-631 [19-210]-[19-215]; CGU Insurance (2016) 259 CLR 339 at 371 [96]. See also Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 67, 80; Coulls v Bagot's Executor and Trustee Co Ltd (1967) 119 CLR 460 at 478, 494; Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 128, 131, 141-142. 39 Aussie Airlines (1996) 68 FCR 406 at 415. See also Santos (2011) 242 CLR 421 at 436 [38]; see also 425 [1]; CGU Insurance (2016) 259 CLR 339 at 357 [42], 40 See, eg, CGU Insurance (2016) 259 CLR 339 at 371 [95]-[96], citing Meadows Indemnity [1989] 2 Lloyd's Rep 298 at 309. See also Meagher, Gummow and Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 631 [19.215]. 41 Clarence City Council v The Commonwealth (2020) 280 FCR 265 at 309 [129]. Gordon In Edwards v Santos Ltd42, Heydon J referred to the decision of the Full Court of the Federal Court in Aussie Airlines Pty Ltd v Australian Airlines Ltd43 as an example of how a person (in that case, an outsider to a contract) can have standing to obtain a declaration and how a court can have jurisdiction to grant a declaration (relevantly, in relation to the contract). In Aussie Airlines, head leases of airport facilities required the head lessee to grant a sublease to any "new entrant to the domestic aviation industry"44. Aussie Airlines Pty Ltd claimed to be a "new entrant to the domestic aviation industry"45. The Full Court of the Federal Court held that Aussie Airlines had standing to obtain a declaration that it was a "new entrant to the domestic aviation industry" even though it was not found to have rights under the head lease enforceable against the head lessee46. The Court held that the question of whether Aussie Airlines was a "new entrant to the domestic aviation industry" was not "hypothetical"; the resolution of the question was of "real practical importance" to Aussie Airlines; Aussie Airlines had a "real commercial interest" in the relief; the head lessee was "plainly a contradictor"; and there was "obviously a real controversy"47. The declaratory relief sought (as to whether Aussie Airlines was a "new entrant to the domestic aviation industry" within the meaning of head leases to which it was not a party) was "of real practical importance" to Aussie Airlines because "[i]f negotiations commence[d] and result[ed] in the grant of subleases" there would be "far-reaching ramifications for the prospective business activities (2011) 242 CLR 421 at 436 [38]; see also 425 [1]. See also Interchase Corporation Ltd (In liq) v FAI General Insurance Co Ltd [2000] 2 Qd R 301 at 311, endorsed in CGU Insurance (2016) 259 CLR 339 at 356-357 [41]-[42]; Ashmere Cove (2008) 166 FCR 398 at 410 [52]-[53]; QBE Insurance (Australia) Ltd v Lois Nominees Pty Ltd (2013) 17 ANZ Insurance Cases ¶61-949 at 73,116 [132]; see also 73,100-73,101 [37]-[40]; CGU Insurance (2016) 259 CLR 339 at 363-364 [67], (1996) 68 FCR 406. (1996) 68 FCR 406 at 408-409. 45 Aussie Airlines (1996) 68 FCR 406 at 410. 46 Aussie Airlines (1996) 68 FCR 406 at 415, 420. 47 Aussie Airlines (1996) 68 FCR 406 at 415. Gordon of Aussie Airlines"48. Aussie Airlines also had "a real commercial interest in obtaining or being refused the declaration" because its future business activities depended upon it obtaining subleases and becoming a new entrant49. Similarly, the Councils have a "sufficient" and "real" interest in seeking declaratory relief about the proper construction of cl 26.2(a) of the Leases. Under cl 26.2(a), the Councils are made active participants in the process established under that clause for the making of ex-gratia payments by the Lessees to the Councils. That process contemplates that the Councils will notify the Lessees of the amount which is "equivalent to the amount which would be payable for rates as if such rates were leviable or payable" in respect of particular parts of the Airports, with the Lessees being obliged to use "all reasonable endeavours" to enter into an agreement with the Councils "to make" those ex-gratia payments. In that sense, and to that extent, the Councils could not be described as the words "outsider[s]" "trading or financial operations" in cl 26.2(a) is of real practical importance to the Councils, given their contemplated role under the Leases. the Leases50. The proper construction of The Councils also have a real commercial interest in the relief. The meaning of the words "trading or financial operations" in cl 26.2(a) will bear upon the calculations made by the Councils as to the quantum of the amount notified by the Councils. That will have direct and far-reaching ramifications51 for the financial position of the Councils. In Santos52, Heydon J regarded it as significant that the plaintiffs' success in obtaining the declaratory relief sought in that case "would advance their interests in the negotiations which the parties were contractually obliged to conduct". The same is true here. If the construction of cl 26.2(a) is determined in favour of the Councils, that would advance their interests for the purposes of future 48 Aussie Airlines (1996) 68 FCR 406 at 415. 49 Aussie Airlines (1996) 68 FCR 406 at 415. 50 CGU Insurance (2016) 259 CLR 339 at 371 [96]. 51 See, by analogy, Aussie Airlines (1996) 68 FCR 406 at 415; CGU Insurance (2016) 259 CLR 339 at 373 [102], 376 [109]. (2011) 242 CLR 421 at 436 [37]. Gordon negotiations contemplated and required by cl 26.2(a)53. The Leases still have 26 years to run, with an option to renew. These reasons should not be read as suggesting that possessing a mere commercial interest in obtaining declaratory relief about the meaning and effect of a contract to which an applicant for declaratory relief is not a party, on its own, would give rise to a "sufficient" or "real" interest. What makes this case exceptional is the combination of circumstances identified at [38]-[40] above. Moreover, these reasons are only concerned with the Councils' claims for declaratory relief. The sufficiency of interest that might be required for a non-party to a contract to establish standing to obtain other forms of relief (for example, an injunction, damages or specific performance) does not arise in these appeals. After the hearing, the Councils filed written submissions seeking to contend, for the first time, that they had standing to seek the declaratory relief sought because they enjoyed the benefit of a contractual promise under the Leases which was held on trust for them. As the Councils have standing to seek the declaratory relief for the reasons set out above, it is unnecessary to address that contention. The issues raised by the Councils' notices of contention also do not arise. Contradictor Finally, the fact that the Lessees are obliged under cl 26.2(a) of the Leases to use all reasonable endeavours to enter into an agreement with the Councils to make the ex-gratia payments and ultimately are obliged to pay amounts to the Councils means that each Lessee is plainly a contradictor. The Lessees certainly do not wish to pay more than they are contractually bound to pay under cl 26.2(a) of the Leases – they each have a real interest in opposing the declaratory relief sought54, indeed they opposed the Councils' construction of cl 26.2(a) before the primary judge. Conclusion and orders For those reasons, each proceeding involves a "matter". The appeals are dismissed with costs. 53 cf Aussie Airlines (1996) 68 FCR 406 at 415; Santos (2011) 242 CLR 421 at 54 Forster (1972) 127 CLR 421 at 437-438, quoting Russian Commercial [1921] 2 AC 438 at 448. GAGELER AND GLEESON JJ. The Federal Court of Australia has, and can only have, such jurisdiction as is vested in it by the Commonwealth Parliament. The jurisdiction of the Federal Court is defined by the Judiciary Act 1903 (Cth) to include original jurisdiction in any civil matter arising under any law made by the Parliament55. The term "matter" connotes "everything which can possibly arise within the ambit" of the federal jurisdiction that is capable of being vested by the Commonwealth Parliament in a court under Ch III of the Constitution56. These two appeals do not call for an exploration of the limits of the term57. Each appeal is concerned rather with determining whether there exists a matter within the central conception of the term. The central conception of a matter is of a justiciable controversy between defined persons or classes of persons about an existing legal right or legal obligation58. The controversy is justiciable if it is capable of being resolved in the exercise of judicial power by an order of a court which, if made, would operate to put an end to the question in controversy through the creation of "a new charter by reference to which that question is in future to be decided as between those persons or classes of persons"59. Conversely, a controversy between defined persons or classes of persons about an existing legal right or legal obligation which is not capable of being resolved in the exercise of judicial power by an order of a court is not justiciable and is not a matter. That was the point made by Gleeson CJ and McHugh J when they said in 55 Section 39B(1A)(c) of the Judiciary Act 1903 (Cth). 56 Official Record of the Debates of the Australasian Federal Convention (Melbourne), 31 January 1898 at 319. See also South Australia v Victoria (1911) 12 CLR 667 at 675, 708; Crouch v Commissioner for Railways (Q) (1985) 159 CLR 22 at 37. 57 cf R v Davison (1954) 90 CLR 353 at 368; Palmer v Ayres (2017) 259 CLR 478 at 58 Fencott v Muller (1983) 152 CLR 570 at 608. 59 R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 374. (1999) 197 CLR 510 at 527 [31] (cleaned up). "A matter cannot exist in the abstract. If there is no legal remedy for a wrong, there can be no matter. A legally enforceable remedy is as essential to the existence of a matter as the right, duty or liability which gives rise to the remedy. Without the right to bring a curial proceeding, there can be no matter." Their Honours spelt out the implications of the relationship between the availability of a remedy and the existence of a matter61: "That does not mean that there can be no matter unless the existence of a right, duty or liability is established. It is sufficient that the moving party claims that he or she has a legal remedy in the court where the proceedings have been commenced to enforce the right, duty or liability in question. It does mean, however, that there must be a remedy enforceable in a court of justice, that it must be enforceable in the court in which the proceedings are commenced and that the person claiming the remedy must have sufficient interest in enforcing the right, duty or liability to make the controversy justiciable. Questions of standing cannot be divorced from the notion of a matter." Their Honours' reference to a "legally enforceable remedy" must be understood as a reference to an order capable of being made by a court in the exercise of coercive judicial power which, subject to appeal, authoritatively determines the question about the right, duty or liability in controversy62. There is no added need for the order to be capable of being enforced by execution63. Taking up the point made by Gleeson CJ and McHugh J, the justiciability of a controversy between defined persons or classes of persons about the content of an existing legal right or obligation depends on: (1) the power of a court to make an order that would operate to resolve the controversy between those persons; and (2) the right of one or more of those persons to seek that order from that court. Standing, in the sense of a right to seek from a court an order that would operate to resolve the controversy, is in that way inseparable from justiciability and, therefore, is intrinsic to the existence of the matter without which the federal (1999) 197 CLR 510 at 528 [32] (cleaned up). 62 TCL Air Conditioner (Zhongshan) Co Ltd v Judges of the Federal Court of Australia (2013) 251 CLR 533 at 553-554 [28]-[29]. 63 cf EB 9 & 10 Pty Ltd v The Owners of Strata Plan 934 (2018) 98 NSWLR 889 at 899 [35], explaining Australian Conservation Foundation Inc v The Commonwealth (1980) 146 CLR 493 at 527-528. jurisdiction of the court to make the order cannot exist. That is what has been meant when it has often been said that standing is "subsumed within the constitutional requirement of a matter"64. A matter can be characterised as one "arising under any laws made by the Parliament" in a range of circumstances65. Once again, these appeals do not call for an exploration of the limits of that range. Each appeal is concerned with a controversy about an existing contractual obligation. If that controversy is justiciable, so as to constitute a matter within the central conception of that term, then that justiciable controversy is properly characterised as a matter arising under a law made by the Parliament on the basis that the contract imposing the obligation came into existence as an incident of the exercise of a capacity to "grant an airport lease" conferred on the Commonwealth by a law made by the Parliament66. In circumstances recounted by Kiefel CJ, Keane and Gordon JJ, each appeal turns on the justiciability of the controversy which has been brewing for some time between a Council (on the one hand) and the Commonwealth as lessor and a Lessee (on the other hand) about the content of the contractual obligation owed by the Lessee to the Commonwealth under cl 26.2 of its Lease. In the proceeding giving rise to each appeal, a Council sought to resolve that controversy by asking the Federal Court to make a declaration about the content of the contractual obligation. The Council asked the Federal Court to make that declaration in a proceeding to which it joined both the Lessee and the Commonwealth as parties. The Council sought no other substantive order. There is no doubt as to the power of the Federal Court to make a declaration of the kind sought by each Council in a proceeding to which the Lessee and the Commonwealth, being the persons whose rights and obligations would be directly 64 See Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 68 [152] (cleaned up) and the cases there cited. See also Attorney-General for NSW v Brewery Employes Union of NSW ("the Union Label Case") (1908) 6 CLR 469 at 491. 65 LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581; Edwards v Santos Ltd (2011) 242 CLR 421 at 438 [45]; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 351-352 [28]-[29]. 66 Section 22 of the Airports (Transitional) Act 1996 (Cth). See Chelsea Investments Pty Ltd v Federal Commissioner of Taxation (1966) 115 CLR 1 at 7-8; Willmott Growers Group Inc v Willmott Forests Ltd (Receivers and Managers Appointed) (In liq) (2013) 251 CLR 592 at 610 [61]. affected by the declaration67, are parties. The Federal Court of Australia Act 1976 (Cth) specifically empowers the Federal Court to make a binding declaration of right in any civil proceeding in relation to a matter in which it has original jurisdiction, whether or not any consequential relief is or could be claimed68, and goes on to spell out that a civil proceeding brought by one party against another is not open to objection on the ground that the only order sought is such a declaration69. There is also no doubt that a declaration of the kind sought by each Council would determine conclusively as between the Lessee and the Commonwealth (and their successors in title) the legal and factual content of the contractual obligation owed by the Lessee to the Commonwealth to the extent that the content of the obligation is in issue between the Council (on the one hand) and the Commonwealth and a Lessee (on the other hand) in the proceeding and to the extent that the resolution of the issue is addressed in the terms of the declaration. The declaration would amount to a "judicial determination directly involving an issue of fact or of law" the legal effect of which would be that the declaration "disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies"70. The notion floated in argument that the efficacy of a declaration would in some way depend on the Commonwealth, as a "model litigant"71, choosing to abide by the declaration in dealing with the Lessee overlooked that final and preclusive legal effect. The question as to the justiciability of the controversy between each Council (on the one hand) and the Commonwealth and a Lessee (on the other hand) 67 John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd (2010) 241 CLR 1 at 46 [131]-[132], applying News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410 at 523-525. 68 Section 21(1) of the Federal Court of Australia Act 1976 (Cth). 69 Section 21(2) of the Federal Court of Australia Act 1976 (Cth). 70 Blair v Curran (1939) 62 CLR 464 at 531; Jackson v Goldsmith (1950) 81 CLR 446 at 466. See also Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 42; Magman International Pty Ltd v Westpac Banking Corporation (1991) 32 FCR 1 at 15, quoting International General Electric Co of New York Ltd v Commissioners of Customs and Excise [1962] Ch 784 at 789. 71 cf Australian Securities and Investments Commission v Hellicar (2012) 247 CLR therefore comes down to a question of the standing of the Council to seek the declaratory relief which it claimed before the Federal Court. Within our constitutional system, standing to seek an order from a court is not conceived of as an exogenous and antecedent fact which must be found as a precondition to jurisdiction. That is to say, we do not conceive of standing as necessarily depending on the person being able to establish some "injury in fact"72 to a legally cognisable interest which the order is apt to redress. Instead, we conceive of standing to seek an order from a court as an aspect of the positive law that defines the jurisdiction of the court to hear and determine the proceeding in which the order is sought. What, if anything, a person must establish to have a right to seek a particular order from a particular court in the exercise of a jurisdiction vested in it by a Commonwealth law depends on what, if anything, the Commonwealth law vesting that jurisdiction in that court expressly or implicitly requires to be established73. To the extent that the jurisdiction vested in a court is to grant a common law remedy on a common law cause of action, standing to seek the remedy is implicit in the definition of the elements of the cause of action74. In respect of a claim to an entitlement to judgment at common law founded on a cause of action based on contract, standing is limited through the operation of the substantive common law doctrines of privity and consideration. Their combined operation means that, subject to exceptions of no present moment, "at common law no one can sue on a contract except those who are contracting parties and (if the contract is not under seal) from and between whom consideration proceeds"75. To the extent that the jurisdiction vested in a court is to grant equitable relief, the position is and always has been more complex. Traditionally, standing 72 cf Lujan v Defenders of Wildlife (1992) 504 US 555 at 560; Spokeo Inc v Robins (2016) 136 S Ct 1540 at 1547-1548. 73 See Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591. 74 Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 626-627 [92]. 75 Coulls v Bagot's Executor and Trustee Co Ltd (1967) 119 CLR 460 at 494, quoting Vandepitte v Preferred Accident Insurance Corporation of New York [1933] AC 70 at 79. See Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 115-116, 128-143, 155-162, 173-174. to seek equitable relief was expressed in terms of the plaintiff needing to establish an "equity"76. That expression has been said to be "somewhat protean in character"77, but has never been doubted to include an equitable interest in property and in particular the interest of a beneficiary under a trust. In Wilson v Darling Island Stevedoring and Lighterage Co Ltd78, in a passage to which attention was drawn in Bahr v Nicolay [No 2]79 and in Trident General Insurance Co Ltd v McNiece Bros Pty Ltd80, it was pointed out that a person not party to a contract for whose benefit a contractual obligation has been entered into can enforce the contractual obligation in equity, in a proceeding to which the contractual obligor and contractual obligee are joined, if an intention to hold the obligation on trust for the person can be imputed to the contractual obligee. Subsequently, in Korda v Australian Executor Trustees (SA) Ltd81, it was explained that "where parties to a contract have refrained from contractual use of the terminology of trust, an intention to create a trust will be imputed to them only if, and to the extent that, a trust is the legal mechanism which is appropriate to give legal effect to the relationship ... between a party and a third party, as established or acknowledged by the express or implied terms of the contract". The inquiry into whether a trust of the contractual obligation is the mechanism appropriate to give effect to the relationship between the contracting party and a third party established or acknowledged by the terms of the contract does not turn simply on whether the contractual obligation was entered into or operates for the benefit of the third party but on whether the relationship between the contractual obligee and the third party is such that the contractual obligee holds the custody and administration of the 76 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 257 [25]. 77 Heydon, Leeming and Turner, Meagher, Gummow & Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 124-125. (1955) 95 CLR 43 at 67. (1988) 164 CLR 604 at 618-619. (1988) 165 CLR 107 at 146-148. See also (1988) 165 CLR 107 at 115, 138-139, 156-157, 167; Aussie Airlines Pty Ltd v Australian Airlines Ltd (1996) 68 FCR 406 (2015) 255 CLR 62 at 100 [109]. See also at 72-73 [10]-[11], 123-124 [204]-[208]. contractual obligation on behalf of the third party so as to be accountable to the third party for that custody and administration82. The possibility that each Council might be able to take advantage of an imputed trust to establish an equitable interest in the performance of the whole or some part of the obligation owed by the Lessee to the Commonwealth under cl 26.2 of the Lease was raised in argument on the appeals. The possibility should be rejected. The absence of the terminology of trust in cl 26.2 of the Lease is significant, as is the consequence that holding the contractual obligation of the Lessee on trust would necessarily entail the Commonwealth being accountable to the Council for the administration of the obligation. In the absence of clear contractual language, no intention is to be imputed to the Commonwealth either to subject itself to a duty of trust enforceable in a court administering equity83 or to subject itself to any duty enforceable at the suit of a State84 or of a local government body, which is a creation and instrumentality of a State85. Each Council's lack of ability to sue on a common law cause of action or to enforce a beneficial interest in a trust cannot be determinative of its standing to seek a declaration, however, given that the declaratory order sought by each Council is neither a common law judgment nor an equitable remedy. The relatively recent observation that a superior court has "inherent power" to make a declaratory order86 cannot be taken to contradict the historical fact that the power to declare the existence or non-existence of a legal right or obligation is statutory in origin. The power was unknown to a common law court. The power was also unknown to a court administering equity other than as prefatory to the making of another order 82 Korda v Australian Executor Trustees (SA) Ltd (2015) 255 CLR 62 at 123-124 [206]-[208], applying Legal Services Board v Gillespie-Jones (2013) 249 CLR 493 83 Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145 at 162-163, 180-181, referring to Kinloch v Secretary of State for India (1882) 7 App Cas 619. 84 South Australia v The Commonwealth (1962) 108 CLR 130; Placer Development Ltd v The Commonwealth (1969) 121 CLR 353. 85 The Municipal Council of Sydney v The Commonwealth (1904) 1 CLR 208 at 240. 86 Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 346 [13]. capable of enforcement by execution87 or in certain proceedings against the Crown88. The power came to be conferred incrementally by statute on the English Court of Chancery in the 1850s and on the English High Court of Justice in the 1870s89. The Supreme Court of New South Wales lacked general power to declare the existence or non-existence of a legal right or obligation before that power was conferred by statute in 196590. Together with this Court, that Court was then instrumental in pioneering the expansion of the practice of entertaining proceedings for declaratory orders that occurred soon afterwards in Australia91. The incidents of a general power to make a binding declaration of right in a civil proceeding, including as to the standing of a person to seek its exercise, came to be expounded in a series of cases in this Court in the final three decades of the last century. The first was Forster v Jododex Australia Pty Ltd92. There, as later in Ainsworth v Criminal Justice Commission93 and Oil Basins Ltd v The Commonwealth94, the Court adopted language of Lord Dunedin in Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd95 in 87 See Heydon, Leeming and Turner, Meagher, Gummow & Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 610-611. 88 See Heydon, Leeming and Turner, Meagher, Gummow & Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 616-617. 89 Woolf and Woolf, Zamir & Woolf: The Declaratory Judgment, 4th ed (2011) at 11- 90 Section 10 of the Equity Act 1901 (NSW) as substituted by the Law Reform (Miscellaneous Provisions) Act 1965 (NSW). See Heydon, Leeming and Turner, Meagher, Gummow & Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at 91 Sir Anthony Mason, "Declarations, Injunctions and Constructive Trusts: Divergent Developments in England and Australia" (1980) 11 University of Queensland Law Journal 121 at 124. (1972) 127 CLR 421 at 437-438. (1992) 175 CLR 564 at 581-582, 595-597. (1993) 178 CLR 643 at 649. [1921] 2 AC 438 at 448. couching standing to seek a declaration in terms of a person having a "real interest" in seeking it. In the meantime, in other cases, standing to seek a declaration was equated with standing to seek an injunction and expressed in language derived from that of Buckley J in Boyce v Paddington Borough Council96 in terms of a person needing to have a "sufficient interest" or a "special interest" in seeking it beyond the interest of an ordinary member of the public. The Court approached the question of standing using that language in a disparate range of controversies – in Robinson v Western Australian Museum97 (where the controversy was about the validity of legislation), in Australian Conservation Foundation v The Commonwealth98, Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd99 and Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA)100 (where the controversy in each case was about the lawfulness of executive action), in Day v Pinglen Pty Ltd101 and Wentworth v Woollahra Municipal Council102 (where the controversy in each case was about whether a building was erected in compliance with planning restrictions), in Onus v Alcoa of Australia Ltd103 (where the controversy was about whether a mining company was in breach of a statutory prohibition) and in Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd104 (where the controversy was about whether the conduct of a business by bodies corporate was permitted by statute). (1977) 138 CLR 283 at 327-329. (1980) 146 CLR 493 at 526-528, 530-531, 547-548. (1981) 146 CLR 249 at 256-257. 100 (1995) 183 CLR 552 at 558-559. 101 (1981) 148 CLR 289 at 299-300. 102 (1982) 149 CLR 672 at 680-681. 103 (1981) 149 CLR 27 at 35-36, 75. 104 (1998) 194 CLR 247 at 264-265 [44]-[45], 267 [50], 280-284 [92]-[103]. In Croome v Tasmania105, standing to seek a declaration was expressed in language drawn from that of Dixon J in British Medical Association v The Commonwealth106, in terms of a person needing to have a "sufficient material interest" in seeking it, as well as in terms of a person needing to have a "real interest" in seeking it. And in Plaintiff M61/2010E v The Commonwealth107, standing was expressed in terms of a person having "a 'real interest' in raising the question to which the declaration would go". Though the expression of standing has been variously in terms of a "sufficient interest", a "sufficient material interest", a "special interest" or a "real interest", the conception of standing developed through that body of case law has been consistent. That conception of standing has involved recognition that a person who does not claim to have a legal right or equitable interest to be vindicated by a declaration or other order that would resolve a controversy about a right or obligation may yet have a material interest in seeking the order. In this context, an interest will be "material" if the person "is likely to gain some advantage, other than the satisfaction of righting a wrong, upholding a principle or winning a contest, if [the order is made] or to suffer some disadvantage, other than a sense of grievance or a debt for costs, if [the order is not made]"108. Depending on the totality of the circumstances, the material interest that the person has in seeking the order may be sufficient to justify a court entertaining the proceeding in which the order is sought. In Robinson109, Mason J observed that "cases are infinitely various" and that "what is a sufficient interest in one case may be less than sufficient in another". In Onus110, Brennan J added to that observation that the sufficiency of the interest of a person in a particular case "must be a question of degree, but not a question of 105 (1997) 191 CLR 119 at 126-127, 138. 106 See (1949) 79 CLR 201 at 257. 107 (2010) 243 CLR 319 at 359 [103] (footnote omitted). 108 Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 109 (1977) 138 CLR 283 at 327-328. See also Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc [No 2] (1993) 41 FCR 89 at 110 (1981) 149 CLR 27 at 75, quoting Baker v Carr (1962) 369 US 186 at 204. See also Kuczborski v Queensland (2014) 254 CLR 51 at 109 [184]-[186]. discretion" and that in answering that question of degree it is appropriate to consider both whether the interest is "sufficient to assure that 'concrete adverseness which sharpens the presentation of issues' falling for determination" and whether the interest is "so distinctive" as to avoid a multiplicity of proceedings. The course of authority in this Court did not follow developments in the United Kingdom in the 1970s and early 1980s, in cases such as Gouriet v Union of Post Office Workers111 and O'Reilly v Mackman112, which introduced a substantive and procedural distinction for doctrinal purposes between standing in "private law" contexts and standing in "public law" contexts113. No distinction between "private law" and "public law" could ever be clear cut114. The distinction has been said in Australia to be "so imprecise that it has contributed little to the construction of legal theory or to the formulation of rules applied by the courts"115. Nor has the course of authority in this Court followed that in the United Kingdom in the manner in which it has accommodated considerations of public interest. The plurality in Bateman's Bay116 specifically rejected, as inconsistent with Australian conditions, the view expressed in Gouriet that an Attorney- General has an "exclusive right ... to represent the public interest"117. True it remains that, within our system of government, "[i]t is an ordinary function of the Attorney-General, whose office it is to represent the Crown in Courts of Justice, to sue for the protection of any public advantage enjoyed under the law as of 113 Allison, A Continental Distinction in the Common Law: A Historical and Comparative Perspective on English Public Law (2000) at 4-12, 23-26. See also Jolowicz, "Civil Proceedings in the Public Interest" (1982) 13 Cambrian Law Review 32 at 39 footnote 43. 114 See Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 226 [42]. 115 Sir Anthony Mason, "Foreword" (2013) 36 University of New South Wales Law Journal 170 at 170. 116 (1998) 194 CLR 247 at 261-263 [35]-[38]. 117 [1978] AC 435 at 481. common right"118. But it would defy our experience of government119 to expect an Attorney-General to act as an apolitical "guardian of the public interest"120 in all cases of granting to, or withholding from, some other person a "fiat" ("simply a contraction of the expression fiat justitia, meaning 'let justice be done'"121) authorising that other person to sue in a "relator action" in the name of the Attorney-General122. As the plurality observed in Bateman's Bay, given that an Attorney-General is commonly here a member of Cabinet, "it may be 'somewhat visionary' for citizens in this country to suppose that they may rely upon the grant of the Attorney-General's fiat for protection against ultra vires action of statutory bodies for the administration of which a ministerial colleague is responsible"123. The plurality emphasised that the approach to standing that has developed in Australia recognises "that the public interest may be vindicated at the suit of a party with a sufficient material interest in the subject matter"124. Where a person is shown to have a material interest in seeking a declaration or other order, considerations bearing on the public interest can contribute to the sufficiency of that material interest to justify a court entertaining the proceeding in which the order is sought. A weighty public interest consideration, where it is applicable, is that the person's interest is within the scope of interests sought to be protected or advanced by the exercise of a statutory power or executive authority through which the right or obligation in controversy has come into existence125. Another weighty consideration, where it is applicable, is that a party by or against 118 Tasmania v Victoria (1935) 52 CLR 157 at 186. 119 See Hanlon, "The Modern First Law Officer in Australia", in Appleby, Keyzer and Williams (eds), Public Sentinels: A Comparative Study of Australian Solicitors- General (2014) 119 at 126-131. 120 Kyriakides, "The Law Officers of the Crown and the Rule of Law in the United Kingdom", in Appleby, Keyzer and Williams (eds), Public Sentinels: A Comparative Study of Australian Solicitors-General (2014) 185 at 196. 121 Re Suncorp Insurance and Finance [1991] 2 Qd R 704 at 711. 122 cf Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 123 (1998) 194 CLR 247 at 262-263 [38]. 124 (1998) 194 CLR 247 at 267 [50]. 125 cf Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 73. whom the right or obligation is held and against whom the declaration is sought is a public authority or an executive government, which "acts, or is supposed to act, not according to standards of private interest, but in the public interest"126. In CGU Insurance Ltd v Blakeley127, Nettle J referred to the proposition "that a person not a party to a contract has no [standing], save perhaps in exceptional circumstances, to obtain a declaration in respect of the rights of other parties to that particular contract"128 as "largely" according with Australian authority. His Honour went on to explain that "[g]enerally speaking it may be correct to say that an outsider has no standing to seek a declaration about the meaning and effect of a contract to which the outsider is not party". His Honour immediately added this qualification: "that depends on what is meant by an 'outsider' and upon the circumstances in which the parties to the contract have chosen, or been influenced, not to raise an issue". His Honour's observation emphasises the absence of any bright-line rule governing when a person who is not a party to a contract has standing to seek a declaration about its meaning and effect. The doctrines of privity and consideration will ordinarily prevent a person who is not a party to a contract being able to establish standing to seek a declaration about the content of a contractual obligation on the basis of a legal interest. There will be cases in which a person who is not a party to a contract will be able to establish standing on the basis of an equitable interest, one category of which will be where the contractual obligation can be established to be held on trust. But neither a legal interest nor an equitable interest exhausts the category of interests capable of amounting to a sufficient interest to seek a declaration about the content of a contractual obligation. For a person to have standing to seek a declaration about the content of a contractual obligation, it is not always necessary for the person to establish an entitlement at common law or in equity to enforce that obligation. Aussie Airlines Pty Ltd v Australian Airlines Ltd129, to which attention was drawn by Nettle J in 126 The Commonwealth v John Fairfax & Sons Ltd (1980) 147 CLR 39 at 51. 127 (2016) 259 CLR 339 at 371 [96]. 128 Meadows Indemnity Co Ltd v Insurance Corporation of Ireland Plc [1989] 2 Lloyd's Rep 298 at 309. 129 (1996) 68 FCR 406. CGU130 and earlier by Heydon J in Edwards v Santos Ltd131, is a pertinent illustration of that proposition. In Aussie Airlines, standard provisions of leases granted by a Commonwealth statutory authority, the Federal Airports Corporation, to Australian Airlines Ltd ("Qantas") obliged Qantas to grant a sublease to any "new entrant to the domestic aviation industry". Aussie Airlines Ltd was held to have standing to seek a declaration that it answered the contractual description of a "new entrant to the domestic aviation industry". Lockhart J, with whom Spender and Cooper JJ agreed, expressly reached that result without needing to determine a submission that Aussie Airlines had an entitlement in equity to enforce the contractual obligation against Qantas. The sufficiency of the interest of Aussie Airlines was explained by Lockhart J as follows132: "The resolution of the question whether Aussie Airlines is 'a new entrant to the domestic aviation industry', when making the request to Qantas for subleases, is of real practical importance to Aussie Airlines. ... Without subleases, Aussie Airlines will be denied a right to carry on the business which it seeks to carry on. Further, Aussie Airlines has a real commercial interest in obtaining or being refused the declaration. Aussie Airlines was incorporated for the express purpose of operating a domestic airline business. Its future business activities, in particular its airline operation, depend entirely upon obtaining subleases of the relevant airport terminal facilities and becoming a new entrant to the domestic aviation industry." The interest of each Council in obtaining a declaration about the content of the contractual obligation owed by that Lessee to the Commonwealth under cl 26.2 of each Lease might be described more as "governmental" than "practical" and more as "fiscal" than "commercial". Otherwise Aussie Airlines is on all fours with the present cases. Like the interest of Aussie Airlines, the interest of each Council in obtaining or being refused the declaration it seeks is distinctive, substantial and squarely within the scope of those third party interests that were sought in the public interest to be advanced through entering into the contractual obligation in the exercise of statutory authority. And like the interest of Aussie Airlines, the interest of each Council in obtaining or being refused the declaration aligns to the 130 (2016) 259 CLR 339 at 373 [102]. 131 (2011) 242 CLR 421 at 436 [38]. 132 (1996) 68 FCR 406 at 415. public interest evidently sought to be advanced by cl 26.2, recognised by the Commonwealth Government and all State and Territory Governments, in "the elimination of resource allocation distortions arising out of the public ownership of entities engaged in significant business activities"133. The only distinction from Aussie Airlines sought to be drawn by the Lessees in argument on the appeals is that Qantas was in dispute with the Federal Airports Corporation, whereas each of them is not in dispute with the Commonwealth about the content of the contractual obligation sought to be made the subject of a declaration. The distinction is not one that amounts to a legal difference. There is no reason why contracting parties must be in dispute in order to be bound by a declaration about the content of a contractual obligation obtained at the instance of a non-contracting party who has a sufficient interest to seek the declaration in a proceeding to which all are party. And there is no reason why the non-existence of a dispute between the contracting parties should operate to reduce the sufficiency of an otherwise sufficient interest of the non-contracting party in seeking the declaration. The controversy between each Council (on the one hand) and the Commonwealth and a Lessee (on the other hand) about the content of the contractual obligation owed by that Lessee to the Commonwealth under cl 26.2 of its Lease is justiciable at the instance of the Council in each proceeding in the Federal Court for a declaration binding on the Commonwealth and the Lessee. The fiscal or governmental interest of each Council in obtaining or being refused the declaration is a sufficient interest to establish standing to seek the declaration. Perhaps it should go without saying that to accept that the controversy about the content of the contractual obligation owed by the Lessee to the Commonwealth is justiciable at the instance of each Council is to say nothing about whether the declarations sought will ultimately be considered appropriate to be made in the form sought or in some other form. Where jurisdiction exists, the making of a declaratory order is discretionary134: "[I]t is thus important to distinguish between the jurisdiction of the court to entertain the [proceeding] at all, ie, to embark upon the inquiry whether facts exist which would entitle the court to grant the relief claimed, and a settled practice of the court to exercise its discretion by withholding the relief if the facts found to exist disclose a particular kind of factual situation. 133 Competition Principles Agreement, 11 April 1995, cl 3(1). 134 Rediffusion (Hong Kong) Ltd v Attorney-General of Hong Kong [1970] AC 1136 at 1155, quoted in Johnco Nominees Pty Ltd v Albury-Wodonga (New South Wales) Corporation [1977] 1 NSWLR 43 at 55-56. The application of a discretion to refuse relief even though this may be pursuant to a settled practice is an exercise of jurisdiction, not a denial of The appeals must be dismissed with costs. EdelmanJ Rights, standing, and matters These appeals concerned three separate but related concepts: "cause of action", "standing", and "matter". Each concept is concerned with the existence of a legal controversy but at different levels of generality. In these appeals, the expression "cause of action" was used in its less common connotation to mean the existence of an exigible legal right135. A legal right in this sense means a claim right, privilege, power, or immunity, or their correlative concepts. In turn, a legal right is necessary, but not sufficient, before any party can have "standing" to bring a claim, in the sense of a liberty of access to the court. A person will usually only have standing if they have a private right or a special interest in enforcing a public right. And, in turn, if a person has standing – in relation to either a public or private right – to have enforced or recognised a legal right against another in relation to particular subject matter, then there will be a "matter" within ss 75 and 76 of the Constitution because there will be "some immediate right, duty or liability to be established by the determination of the Court"136. For that reason, standing to enforce private and public rights is "subsumed within the constitutional requirement of a 'matter'"137. The starting point for any analysis in these appeals therefore requires, first, identification of the nature of the rights involved and, secondly, consideration of whether the first respondents have standing to seek declarations in relation to those rights. If they do not have standing, then there is no matter. We gratefully adopt the facts set out in the reasons of Kiefel CJ, Keane and Gordon JJ. As those reasons also demonstrate, there are plainly rights involved in this case between the Commonwealth and the counterparties to the leases described below ("the Leases"). The relevant clauses in the lease between the 135 See Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 611. 136 In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265. See also CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 368 [85]. 137 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 262 [37]; Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 68 [152]. See also Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 550-551; Croome v Tasmania (1997) 191 CLR 119 at 124-126, 132-136; Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 EdelmanJ Commonwealth and Hobart International Airport Pty Ltd ("HIAPL") concerning the land comprising Hobart Airport are the same as the clauses found in the lease between the Commonwealth and Australia Pacific Airports (Launceston) Pty Ltd ("APAL") concerning the land comprising Launceston Airport (together, "the Airport Sites"). The issues raised by the Clarence City Council in relation to the HIAPL lease are the same as the issues raised by the Northern Midlands Council in relation to the APAL lease. Therefore, resolution of the issues in the HIAPL appeal will also resolve the issues in the APAL appeal. The parties with rights arising under the Leases, the Commonwealth and each of HIAPL and APAL ("the Lessees"), are not in dispute about the existence or content of their rights. Rather, third parties, the Clarence City Council and the Northern Midlands Council ("the Councils"), seek declarations concerning rights in the Leases, which have been treated throughout this proceeding as, in effect, contractual rights138. Some of the submissions in support of the Councils' standing to seek declarations sought to abolish the distinction between standing in respect of public rights and private rights with the effect that, as with public rights, a person should be able to obtain a remedy in relation to the private rights of another if the person has a commercial interest in doing so. The distinction between public and private rights is principled, well established, and of fundamental importance. It is one that has been drawn consistently for more than 120 years and that has been repeated almost ad nauseam in this Court. The distinction should not be abolished. For the reasons below, we agree with Kiefel CJ, Keane and Gordon JJ that the rights between the parties to the Leases are purely private rights. We differ from Kiefel CJ, Keane and Gordon JJ only in the respect that we do not consider that the Councils have standing in these proceedings to seek declarations concerning the private contractual rights of the Commonwealth and the Lessees. That is not a difference of principle but only of application, concerning exceptional circumstances. Whatever might be any for exceptional circumstances in which one party could obtain a declaration as to the private rights of others, the circumstances of these appeals are not exceptional. And since the rights involved are not public rights, it does not avail the Councils to point to the special interest they have in relation to those rights beyond the interest of an ordinary member of the public. limited scope 138 See Shevill v Builders Licensing Board (1982) 149 CLR 620 at 625; Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 29-30. EdelmanJ The fundamental divide between public and private rights The power to make a declaration in the circumstances of these appeals is expressed, in terms that have been common since the Court of Chancery Procedure Act 1852139, as a power to "make binding declarations of right, whether or not any consequential relief is or could be claimed"140. There is, however, a "fundamental"141 distinction, affirmed many times in this Court in this area of law, between public rights and private rights. As to private rights, these are the rights that are distinctly owed to a particular legal person or persons, separately from the public at large. The concept of "right" is used loosely and broadly. As Professor Borchard observed of the expression "declarations of right", it is one that "must be found to cover [a claim] right, privilege, power, immunity, duty, no-right, liability, disability"142. It also extends to circumstances where it is asserted that those "legal relations have been thrown into doubt ... by the unfounded claim of a defendant"143. Examples of private rights include claim rights, powers, or privileges of a private person against others that are recognised by the law of contract, torts, or equity. They also include statutory rights that apply to an individual, or individuals, in particular circumstances such as a right to be treated with procedural fairness144. Where private rights are concerned, the general rule is that only a person whose private rights are infringed or threatened has standing to seek legal remedies in relation to those private rights. Those remedies include injunctions and declarations. The general rule has been long established. The liberty of access to the courts – standing – for recognition or enforcement of a person's own legal rights or obligations has been said to be "deeply rooted in constitutional principle"145. 139 15 & 16 Vict c 86, s 50. 140 Federal Court of Australia Act 1976 (Cth), s 21(1). 141 Gouriet v Union of Post Office Workers [1978] AC 435 at 482. 142 Borchard, Declaratory Judgments, 2nd ed (1941) at 212. See also Sankey v Whitlam (1978) 142 CLR 1 at 23. 143 Borchard, Declaratory Judgments, 2nd ed (1941) at 928. 144 Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581-582. 145 Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603 at EdelmanJ Conversely, a person generally has no standing where the claim concerns another person's private legal rights or obligations146. Hence, for more than a century, the general rule has been that a person who is not a party to a contract is unable to obtain an injunction to enforce contractual obligations merely by showing a "material interest" in relation to those obligations, no matter how substantial, commercial, or important that interest may be. To the argument that such an interest is sufficient, the "obvious answer", which "has been applied in many cases", is that a person who is not a party to a contract "can neither sue nor be sued on that contract"147. In contrast with private rights and other rights of action conferred by statute, the enforcement of public rights, owed to the public at large, was usually by the Attorney-General as the representative of the public, either ex officio or on the relation of a private person148. The relator action existed because the relator "cannot be said to have the ordinary private right to a remedy"149. In the absence of a statutory right of action, a plaintiff will only be able to bring a legal action to enforce a purely public right if the rules of standing permit the plaintiff to enforce that public right. This fundamental distinction between public rights and private rights has been relied upon in many cases in this Court in the development of the rules of standing in relation to public rights, particularly where a plaintiff seeks relief in the form of declarations or injunctions. A public right is an expression that describes legal relations involving the public generally rather than any specific person or persons. The best examples are persons who have statutory powers in relation to the public or sections of the public. The general public have rights and liabilities corresponding to the duties owed by those persons in the exercise of the powers, and the extent of the powers. In early decisions of this Court, a restrictive approach was taken to the standing of private persons to seek recognition or enforcement of public rights. In the absence of a statutory power to sue, standing to seek relief in relation to public rights was 146 Stockport District Waterworks Co v Mayor &c of Manchester (1862) 7 LT 545 at 548; London Passenger Transport Board v Moscrop [1942] AC 332 at 344. 147 Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 148 Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 526; Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 276 [82]. See also Taylor v Attorney-General (Cth) (2019) 268 CLR 224 at 266 [113]. 149 Liston v Davies (1937) 57 CLR 424 at 442. EdelmanJ generally limited to the relevant Attorney-General, including on the relation of a member of the public, since the Attorney-General was the representative of the relevant public150. As will be seen, although that approach to standing has been liberalised, it has never been suggested that this liberalisation has stripped the Attorney-General of their power to bring a relator action or that the fundamental distinction in this field between public rights and private rights has been collapsed. An early example of this Court drawing a distinction between public rights and private rights is Anderson v The Commonwealth151. In that case, the plaintiff, who paid taxes and consumed sugar, sought a declaration as to the invalidity of an agreement between the Commonwealth and the State of Queensland which prohibited the importation of sugar. This Court held that the plaintiff had no private rights since he was not a party to the agreement. And, although the agreement gave rise to public rights enforceable by the relevant Attorney-General, "[g]reat evils would arise if every member of the Commonwealth could attack the validity of the acts of the Commonwealth whenever [they] thought fit; and it is clear in law that the right of an individual to bring such an action does not exist unless [they] establish[] that [they are] 'more particularly affected than other people'"152. Many cases have reiterated this distinction between, on the one hand, a person having a private right, and therefore standing to bring an action, and, on the other hand, a person seeking to enforce a public right. In the latter case, the general proposition, subject to exceptions where the person is specially or sufficiently affected, is that "a person not affected in [their] private rights may not sue for declaratory relief"153. Over time, there have been developments in the approach to determining the circumstances in which a person is sufficiently affected so as to have standing 150 Attorney-General for NSW v Brewery Employes Union of NSW (1908) 6 CLR 469 151 (1932) 47 CLR 50. See also Ramsay v Aberfoyle Manufacturing Co (Australia) Pty Ltd (1935) 54 CLR 230 at 254, 261. 152 (1932) 47 CLR 50 at 52. 153 Robinson v Western Australian Museum (1977) 138 CLR 283 at 327. See also the cases discussed in the following paragraphs of these reasons as well as Seamen's Union of Australia v Utah Development Co (1978) 144 CLR 120 at 126-127; Davis v The Commonwealth (1986) 61 ALJR 32 at 35; 68 ALR 18 at 23; Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 599 [2], 603 [20], 609 [39], 611-612 [46], 640 [131]. EdelmanJ this Court to bring an action to enforce or recognise a public right. On the appeal to the Full in Australian Conservation Foundation v The Court of Commonwealth154, Gibbs J referred to the approach of Buckley J in Boyce v Paddington Borough Council155 that a plaintiff can sue either where there is an interference with the plaintiff's private rights or "where no private right is interfered with, but the plaintiff, in respect of [a] public right, suffers special damage" – that is, damage peculiar to themself – "from the interference with the public right". Gibbs J, with whom Mason J agreed156, described the language of Buckley J as "not altogether satisfactory" and liberalised the test for when a plaintiff can enforce a public right from one of "special damage", which connoted a requirement for damage, to one of having a special interest in the subject matter of the action157. Nevertheless, the reasoning of each member of the Court, except Murphy J, emphasised the distinction between public rights and private rights158. In Onus v Alcoa of Australia Ltd159, the plaintiffs were Aboriginal people who sought to restrain Alcoa of Australia Ltd from carrying out construction works that were said to interfere with Aboriginal relics in contravention of s 21 of the Archaeological and Aboriginal Relics Preservation Act 1972 (Vic). The primary judge held that the plaintiffs had no standing on the basis of either private rights or an interest to enforce the Act. An appeal to the Full Court of the Supreme Court of Victoria was dismissed. Every member of this Court held that the Act conferred no private rights upon the plaintiffs160. Therefore, as Brennan J explained, the plaintiffs were "constrained to establish standing by bringing themselves within the exception to the rule that a private citizen cannot bring proceedings to prevent public wrongs"161. Every member of this Court allowed the appeal, accepting the appellants' alternative submission that the appellants had standing to "prevent the 154 (1980) 146 CLR 493 at 526-527. 155 [1903] 1 Ch 109 at 114. 156 (1980) 146 CLR 493 at 547. 157 (1980) 146 CLR 493 at 527-528. 158 (1980) 146 CLR 493 at 526, 537-538, 547. 159 (1981) 149 CLR 27. 160 (1981) 149 CLR 27 at 35, 41, 43, 44, 48-49, 60, 68. 161 (1981) 149 CLR 27 at 68. See also at 35-36, 41, 49. Cf the broader view of Murphy J EdelmanJ violation of a public right"162 where their cultural and historical interest was, or might be163, a special interest sufficient to support standing164. The same principle was applied in the unanimous joint judgment of this Court in Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA)165. One question for this Court was whether a union with members who were shop assistants had standing to seek an injunction and a declaration as to the invalidity of exemption certificates that were proposed to be issued by the respondent Minister under the Shop Trading Hours Act 1977 (SA). The joint judgment approached the question of standing in the orthodox way by first considering separately whether the rights to be enforced were private or public rights. The Court held that the Shop Trading Hours Act conferred no private rights but that the union could bring an action to compel observance of the Act – "to prevent the violation of a public right"166 – because the shop assistants, and therefore the union, had a "special interest in the subject matter of the litigation"167. The Court then applied the approach of Gibbs CJ in Onus v Alcoa168 requiring a special interest in the subject matter of the litigation in order to enforce a public right. In Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd169, the question again concerned the enforcement of a public right. The question was whether the respondents, a contributory funeral benefit fund and a contributory life insurance fund catering for members of the Aboriginal community in New South Wales, had standing to seek an injunction to restrain the appellants from setting up a rival business. The injunction was sought on the basis 162 (1981) 149 CLR 27 at 35. See also at 41, 45, 49, 60, 66, 68-69. 163 (1981) 149 CLR 27 at 57. 164 (1981) 149 CLR 27 at 35-36, 41-43, 44, 63, 78. See also Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 530-531, 537, 547-548. 165 (1995) 183 CLR 552 at 557-559. 166 (1995) 183 CLR 552 at 558. 167 (1995) 183 CLR 552 at 558. 168 (1981) 149 CLR 27 at 35-36. Also citing Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493. 169 (1998) 194 CLR 247. EdelmanJ that the conduct of such a business was beyond the appellants' statutory powers. This Court held that the potential damage to the business of the respondents was a sufficiently special interest for the respondents to have standing to seek the injunction to enforce the public rights. In a joint judgment, Gaudron, Gummow and Kirby JJ cast doubt upon the restrictive attitude that had been taken in cases from Gouriet v Union of Post Office Workers170 onwards as to whether a party's interest was sufficiently special for standing to exist in cases involving public rights. They concluded that the respondents had an "immediate, significant and peculiar" interest in the observance by the appellants of the statutory limitations upon the appellants' powers171. Nothing said by their Honours cast any doubt upon the fundamental distinction between private rights and public rights. To the contrary, their Honours emphasised172: "In private law there is, in general, no separation of standing from the elements in a cause of action. Further, the requirement of a legal right determines the availability of injunctive relief and there is no separate requirement which determines entitlement to approach a court of equity." In a separate judgment, McHugh J took a more traditional approach to the requirement of a special interest to enforce public rights. But, like the joint judgment, his Honour emphasised the "private rights and public rights dichotomy"173. The language of a "dichotomy" between public rights and private rights must, however, be used carefully. Simply because a public right exists and is perhaps enforceable by a plaintiff against a defendant does not mean that, on the facts before a court, a plaintiff cannot also have a private right. The co-existence in some cases of a plaintiff's claim for public and private nuisance at common law is an exemplar of that phenomenon. Unsurprisingly, given the conjunction of principle concerning standing to obtain injunctions and declarations, the distinction between public rights and private rights has been repeated constantly in this Court in cases involving 171 (1998) 194 CLR 247 at 267 [52]. 172 (1998) 194 CLR 247 at 264 [43]. 173 (1998) 194 CLR 247 at 275-280 [77]-[91]. EdelmanJ injunctions174. For instance, in Cardile v LED Builders Pty Ltd175, it was said that an injunction is only available "to protect the legal (including statutory) or equitable rights of the plaintiff"; otherwise, the injunction can only be sought in respect of public rights, including for "the administration of a trust for charitable purposes, or the observance of public law at the suit of the Attorney-General, with or without a relator, or at the suit of a person with a sufficient interest". The distinction between public rights and private rights is also the very reason that for more than a century courts have considered whether legislation creates private rights to enable a claim for an injunction or damages for breach of statutory duty. A person who has no special interest to enforce public rights created by statute must establish that Parliament intended to create a "private right" in order to bring a claim based on contravention of the statute176. That intention must be found as a matter of statutory interpretation, usually by implication. As Kitto J remarked in Sovar v Henry Lane Pty Ltd177, the intention of Parliament "that such a private right shall exist is not ... conjured up by judges to give effect to their own ideas of policy". For these reasons, the distinction between public and private rights should not be collapsed. To do so would require rejection of more than a century of established case law. That case law is based upon the fundamental and correct distinction between a duty that is owed to, and a right that is held by, particular persons, and a duty that is owed to, and a right that is held by, the public, or a section of the public, at large. The relator action is one example of a doctrine that has developed around this distinction. Rules of standing are another. Some cases 174 See, eg, Day v Pinglen Pty Ltd (1981) 148 CLR 289 at 299; Wentworth v Woollahra Municipal Council (1982) 149 CLR 672 at 682-683. 175 (1999) 198 CLR 380 at 394 [28]. 176 Smith v William Charlick Ltd (1924) 34 CLR 38 at 58; Buckle v Bayswater Road Board (1936) 57 CLR 259 at 281; O'Connor v S P Bray Ltd (1937) 56 CLR 464; Darling Island Stevedoring and Lighterage Co Ltd v Long (1957) 97 CLR 36; Leask Timber and Hardware Pty Ltd v Thorne (1961) 106 CLR 33; Jacob v Utah Construction and Engineering Pty Ltd (1966) 116 CLR 200; Sovar v Henry Lane Pty Ltd (1967) 116 CLR 397; Byrne v Australian Airlines Ltd (1995) 185 CLR 410; Pyrenees Shire Council v Day (1998) 192 CLR 330; Brodie v Singleton Shire Council (2001) 206 CLR 512. 177 (1967) 116 CLR 397 at 405. See also Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 482; Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 460-461; Brodie v Singleton Shire Council (2001) 206 CLR 512 at 633 [325]. EdelmanJ might involve both public and private rights. Some might be at the boundaries between public and private. But, just as the existence of twilight or shades of grey does not invalidate the distinction between night and day or black and white178, these boundary cases cannot invalidate the difference between public and private rights. Interpretation issues concerning cl 26.2(a) of the Leases The Councils argued that cl 26.2(a) of the Leases constituted the Commonwealth as a trustee of the benefit of rights contained in cl 26.2(a) for the Councils. That argument turns upon the interpretation of cl 26.2(a). The Councils also argued that, even if the Councils were strangers to the rights in cl 26.2(a), the nature of those rights and the circumstances in which they arose were sufficiently exceptional to permit the Councils to obtain declarations as to the meaning of cl 26.2(a). It is necessary, therefore, to interpret cl 26.2(a) in order to determine whether the Commonwealth is a trustee of any rights for the benefit of the Councils and whether any rights of the Councils under cl 26.2(a) are public rights or private rights, or both. Apart from the submissions, addressed later in these reasons, concerning whether cl 26.2(a) created a trust, the parties to these proceedings made few submissions about the proper interpretation of cl 26.2(a). The parties generally assumed that cl 26.2(a) imposed a duty upon the Lessees to make payments in lieu of rates to the Councils in accordance with the formula in cl 26.2(a). This assumption by the parties concerns an issue of interpretation of cl 26.2(a) that is related to those above. It suffices for the purpose of these reasons to explain at the outset that the parties' assumption might not be correct. Clause 26.2(a) provides: "EX GRATIA PAYMENT IN LIEU OF RATES AND LAND TAX (a) Where Rates are not payable under sub-clause 26.1 because the Airport Site is owned by the Commonwealth, the Lessee must promptly pay to the relevant Governmental Authority such amount as may be notified to the Lessee by such Governmental Authority as being equivalent to the amount which would be payable for rates as if such rates were leviable or payable in respect of those parts of the Airport Site: which are sub-leased to tenants; or 178 Gleeson, "Judicial Legitimacy" (2000) 20 Australian Bar Review 4 at 11. EdelmanJ on which trading or financial operations are undertaken including but not limited to retail outlets and concessions, car parks and valet car parks, golf courses and turf farms, but excluding runways, taxiways, aprons, roads, vacant land, buffer zones and grass verges, and land identified in the airport Master Plan for these purposes, unless these areas are occupied by the Commonwealth or an authority constituted under Commonwealth law which is excluded from paying rates by Commonwealth policy or law. The Lessee must use all reasonable endeavours to enter into an agreement with the relevant Governmental Authority, body or person to make such payments." The immediate contractual context of cl 26.2(a) includes cl 26.1, which is in these terms: "PAYMENT OF RATES AND LAND TAX AND TAXES The Lessee must pay, on or before the due date, all Rates, Land Tax and Taxes without contribution from the Lessor." The contractual context also includes cl 26.2(b), which imposes a different obligation to pay amounts in lieu of land tax. It provides: "(b) Where Land Tax is not payable under sub-clause 26.1 because the Airport Site is owned by the Commonwealth, payments in lieu of Land Tax must be made by the Lessee in respect of those parts of the Airport Site: which are sub-leased to tenants; or on which trading or financial operations are undertaken including, but not limited to, retail outlets and concessions, car parks and valet car parks, golf courses and turf farms, but excluding runways, taxiways, aprons, roads, vacant land, buffer zones and grass verges, and land identified in the airport Master Plan for these purposes, unless these areas are occupied by the Commonwealth or an authority constituted under Commonwealth law which is excluded from making payments by Commonwealth policy or law. Unless otherwise directed by the Lessor, the Lessee will make payments promptly in lieu of land tax at the relevant State rate to the Commonwealth addressed as provided for in sub-clause 24.1. EdelmanJ These payments in lieu of Land Tax will be levied on a financial year basis. The Lessee must submit an assessment of the payment in lieu of land tax to the Commonwealth on 31 August of the current financial year with this payment due 30 days later. Land value assessment for the purposes of making payments in lieu of land tax are required at least every three years." Finally, there is cl 26.2(c), which addresses stamp duty, payroll tax and the like. It is similar in effect to cl 26.2(b). It provides: "(c) Where Taxes such as stamp duty, payroll tax, financial institutions duty and debits tax imposed by a Governmental Authority are not payable by the Lessee because they are Taxes on transactions, instruments or activities on or related to the Airport Site owned by the Commonwealth, the relevant Governmental Authority such amount as is equivalent to the amount which would be payable for such Taxes if such Taxes were leviable or payable." the Lessee must pay It is unnecessary to reach any final conclusion as to the meaning of cl 26.2(a), which may be the subject of full argument on the remittal of these proceedings. It suffices to say, however, that it is arguable that the assumption concerning the meaning of cl 26.2(a) upon which the Councils proceeded in their submissions in this Court is incorrect. That assumption was that, in the absence of any agreement between the Lessees and the Councils, the Lessees were obliged to make payments in lieu of rates to the Councils. An appreciation of why the assumption may be incorrect commences with cl 26.2(b). That subclause is premised on a state of affairs in which land tax is not payable because the "Airport Site[s]", being Hobart Airport and Launceston Airport, are "owned by the Commonwealth". Clause 26.2(b), by its terms, creates a liability to pay to the Commonwealth (and not to the State of Tasmania) payments "in lieu of" land tax on a "financial year basis". Such payments "must be made". The Lessees "must submit an assessment of the payment" to the Commonwealth on 31 August every financial year, with the resulting payment being "due 30 days later". And, at least every three years, a "Land value assessment" must be completed. Clause 26.2(b) does not refer to the need for the parties to enter into any agreement for payments of money in lieu of land tax. Nor does it require any notification by the Commonwealth of the amount of the payments to be made. That is because the terms of cl 26.2(b) create the liability in question. The reference in cl 26.2(b)(ii) to those parts of the Airport Sites "on which trading or financial operations are undertaken", and the examples of such operations that follow in the paragraph, use precisely the same language as that EdelmanJ found in cl 26.2(a)(ii). That language operates as part of the positive criteria to be applied objectively to determine the quantum payable in lieu of land tax. As such, a dispute between the parties about the meaning of that language may conformably be resolved by declaratory orders made by a court. So, for example, a dispute between the Commonwealth and Essendon Airport Pty Ltd concerning a clause in the same terms as cl 26.2(b) was resolved by the grant of declaratory relief179. Clause 26.2(c) is similar to cl 26.2(b). It concerns the making of payments which are equivalent to the amount that would have been payable by the Lessees, had the Airport Sites not been owned by the Commonwealth, on account of "stamp duty, payroll tax, financial institutions duty and debits tax". Like cl 26.2(b), cl 26.2(c) does not refer to the need for the parties to enter into any further agreements with the Governmental Authorities for payments of money in lieu of these taxes and duties. Nor does it require any notification by those authorities of the amount of the payments to be made. This is because, like cl 26.2(b), cl 26.2(c) creates a positive obligation to make such payments to the relevant Governmental Authority. Clause 26.2(a) operates in a notably different manner from cll 26.1, 26.2(b), and 26.2(c). Several observations may be made in relation to these differences. First, cl 26.2(a) operates by requiring the Lessees to "use all reasonable endeavours to enter into an agreement" with the Councils. The agreement is not expressed as a matter of the mechanics or formula for payments that are already required. Rather, the agreement is "to make such payments". A contrast with the other three liability-creating clauses might arguably be that the only liability under cl 26.2(a) is created by an agreement, under the power contained in s 134 of the Local Government Act 1993 (Tas). Secondly, the heading to cl 26.2 suggests that there may be no obligation to make payments in lieu of rates. The heading describes the "payment in lieu of rates" as "ex gratia" (meaning by favour, or without obligation). In other words, until an agreement is reached, there is no obligation to make the payments. As Gibbs CJ observed in Hospital Products Ltd v United States Surgical Corporation180, an obligation to use "best endeavours" does not require the person "to go beyond the bounds of reason"; the person is required to do all that they "reasonably can in the circumstances to achieve the contractual object, but no more". It follows that the obligation on the Lessees, conformably with their duty to do all that they reasonably can do, may or may not result in the entry into an 179 The Commonwealth v Essendon Airport Pty Ltd [No 2] [2019] FCA 1694. See also The Commonwealth v Essendon Airport Pty Ltd [2019] FCA 1411. 180 (1984) 156 CLR 41 at 64. EdelmanJ agreement to make payments in lieu of rates to the Councils. Unless and until such an agreement is struck, however, any payments by the Lessees to the Councils are ex gratia, and the Councils have no more than a hope or expectancy of payments. Thirdly, unlike cl 26.2(b) or 26.2(c), the obligation in cl 26.2(a) to pay to the Councils an amount equivalent to rates is conditioned upon "such amount as may be notified to [the Lessees] by [the Councils]". It may be that the notification to which reference is made is properly understood as concerning the amount that is due under any agreement reached. On that approach, because an agreement may never be reached, cl 26.2(a) refers only to the amount which "may be notified" by the Councils. The conditional reference, "may be notified", implicitly acknowledges that an agreement might not be reached. In any event, "may be notified" contrasts with the imperatives of "must" or "will" which are deployed in cll 26.1, 26.2(b) and 26.2(c). Fourthly, and again unlike cl 26.2(b), the Commonwealth's role is not prominent in cl 26.2(a). The Commonwealth is not the administrator of cl 26.2(a) until an agreement is reached between the Lessees and the Councils. That is, save for enforcing, if necessary, the Lessees' promise to use reasonable endeavours under cl 26.2(a), the Commonwealth has nothing to do. Fifthly, it may be that the phrases in dispute between the Lessees and the Councils in cl 26.2(a)(ii) as to the parts of the Airport Sites required to be included in the calculation and the valuation methodology of the payments pursuant to cl 26.2(a) give content to the duty on the Lessees to use reasonable endeavours to negotiate and enter into such an agreement. That would be because the subject matter of the agreement is the making of "such payments", namely the payments earlier described. Thus, to illustrate, the Lessees have promised, by cl 26.2(a), to use reasonable endeavours to negotiate an agreement which obliges the Lessees to make payments that are "equivalent to the amount which would be payable for rates as if such rates were leviable". The obligation to use reasonable endeavours is owed to the Commonwealth, who may enforce it, and not to the Councils. If the obligation on each of the Lessees – owed to the Commonwealth – is only to use reasonable endeavours to negotiate an agreement with each of the Councils, it is relevant that, with the parameters of that negotiation informed by the general words used in cl 26.2(a), including the parts of the Airport Sites required to be included in the calculation and the valuation methodology of the payment, the Councils are not so confined. The Councils are free to make whatever offers they consider are consistent with their own duties and interests. However, knowing the constraints to which the Lessees are subject, there would be a natural incentive for the Councils also to tailor any negotiation with the Lessees to conform to cl 26.2(a). EdelmanJ Ultimately, and on any view, whether the Lessees and the Councils are able to reach such an agreement is a matter for them. They will, in that respect, be free to negotiate about which parts of the Airport Sites are to be treated as parts on which trading or financial operations are undertaken and about what type of valuation methodology should be used to determine the Lessees' liability. It does not matter whether such an agreement would or would not conform to an objective application of the words employed by cl 26.2(a) or to their correct judicial interpretation. The scope of the negotiation to be had is necessarily broader than that. That is not only because the words of cl 26.2(a) do not bind the Councils, but also because those words do not operate as the actual criteria for liability. Rather, the criteria for the liability to make payments in lieu of rates will be that which may be agreed as between the Lessees and the Councils. For these reasons, it is at least arguable that, unlike cl 26.2(b) or 26.2(c), the words used in cl 26.2(a) do not constitute the criteria for liability to make payments but instead contemplate only the entry into an entirely separate agreement which would establish that liability. Does cl 26.2(a) confer private rights enforceable by the Councils? Privity of contract is an "elementary"181 doctrine "which is both settled and fundamental"182 and is "as well established as any [principle] in our law"183. In Coulls v Bagot's Executor and Trustee Co Ltd184, Barwick CJ said that "according to our law, a person not a party to a contract may not ... sue upon it so as directly to enforce its obligations". Most so-called common law "exceptions" to privity are not exceptions at all185. For instance, "third parties" who claim as principal of a 181 Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 182 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 183 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 184 (1967) 119 CLR 460 at 478. See also Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 127; Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 418-419; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 371 [96]. 185 Midland Silicones Ltd v Scruttons Ltd [1962] AC 446 at 473; Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 67; Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 143. Cf statutory EdelmanJ contracting party will generally be a party to the contract and persons who claim as a beneficiary under a trust of contractual rights held by the contracting party, or as an equitable assignee, generally do so by joinder of the party to the contract in order to assert the trustee's or assignor's rights186. The Councils did not make sweeping, radical submissions in support of their ability to obtain declarations concerning the rights of parties to contracts to which they were strangers. Their position was much more modest. In carefully drawn submissions, they sought only to expand the ability of a stranger to obtain relief in relation to a contract in the form of a declaration and, even then, by notice of contention, they alleged that this was only possible in exceptional circumstances, of which the present were said to be an example. In Meadows Indemnity Co Ltd v The Insurance Corporation of Ireland Plc187, May LJ said that: "a person not a party to a contract has no locus, save perhaps in exceptional circumstances, to obtain a declaration in respect of the rights of other parties to that particular contract. It would be contrary to the whole principle of privity to allow such a person to obtain such a declaration. [That person] has no 'rights' in respect of that contract and has no claim for relief under This statement is correct. It is based on the foundational principle that a declaration of right must be concerned with the "right" of the party seeking the declaration, separate from any rights created by the declaration. The statutory conferral by the Court of Chancery Procedure Act 1852188 of a power to make declarations of right was not a Frankensteinian creation of almost unlimited jurisdiction for a court to declare a right and then claim authority for that declaration based on the new right that was just declared. Nor did the authority to declare private rights generally extend to the declaration of private rights of others merely because a plaintiff might have an interest in how others exercise their rights. That remains the case in this exceptions such as Property Law Act 1969 (WA), s 11(2); Property Law Act 1974 (Qld), s 55(1). 186 See Tham, Understanding the Law of Assignment (2019) at 171-178. 187 [1989] 2 Lloyd's Rep 298 at 309. 188 15 & 16 Vict c 86, s 50. EdelmanJ country, whether or not English law has "moved on"189 as a result of the expansion of the power to order a "declaration of right" to a power to "make binding declarations" without an established right, including on an interim basis190. In CGU Insurance Ltd v Blakeley191, in the context of a contract of insurance, Nettle J endorsed the above-quoted statement of May LJ from Meadows, whilst also elevating the possibility of exceptional circumstances where a third party may have standing to obtain a declaration to an actuality. The approach of the other members of this Court in CGU Insurance may be understood as recognising standing to enforce a private right due to implied statutory authority rather than relying upon exceptional circumstances in its context of insurance192. But it must be accepted that it was not wholly novel for rights in insurance contracts to be treated as exceptional193. Indeed, in Trident General Insurance Co Ltd v McNiece Bros Pty Ltd194, three members of this Court treated the entire doctrine of privity of contract as subject to an exception in relation to insurance contracts. Insurance contracts have also been treated by statute as a special case195. The danger with exceptions, however, is that unless they "prove the rule" – that is, unless they fall outside the rationale for the rule – then, without great care being taken, the growth of exceptions without an underlying rationale can overwhelm a coherent rule. Whatever the merit of an "insurance" exception, the instruments in these appeals, the Leases, were not insurance contracts. Neither the Councils nor the Commonwealth were able to point to any sufficient reason to undermine the basic rule that, without statutory authority, the Councils have no 189 Feetum v Levy [2006] Ch 585 at 606 [82]; Rolls-Royce Plc v Unite the Union [2010] 1 WLR 318 at 350 [120(4)]. 190 Civil Procedure Rules 1998 (UK), rr 25.1(1)(b), 40.20; Woolf and Woolf, Zamir & Woolf: The Declaratory Judgment, 4th ed (2011) at 49 [3-23], 52 [3-29], 237-238 191 (2016) 259 CLR 339, especially at 371 [95]-[96]. 192 (2016) 259 CLR 339 at 363-364 [67]. 193 See Employers Reinsurance Corporation v Ashmere Cove Pty Ltd (2008) 166 FCR 398; QBE Insurance (Australia) Ltd v Lois Nominees Pty Ltd (2013) 17 ANZ Insurance Cases ¶61-949. 194 (1988) 165 CLR 107 at 123-124, 167-172. 195 Insurance Contracts Act 1984 (Cth), s 48. EdelmanJ standing to seek the recognition or enforcement of the rights of others. The Councils unquestionably have a real commercial interest in seeking declarations as to the meaning of the Leases. But to recognise their interests as sufficient for a declaration would be to undermine the very basis of the rule by which courts granting a declaration of a private right do so at the instance of a person who is a party to that jural relationship, not a stranger to it. The alternative submissions of the Councils, raised in oral submissions and in supplementary written submissions following questions from this Court, were that the Councils have rights in relation to the Leases as beneficiaries of a trust created by the Commonwealth of the promise contained in the Leases. If such a trust had been created then there is no doubt that the Councils would have standing to obtain declarations as to their legal rights under the Leases by joining the Commonwealth, in its capacity as trustee, as a defendant, and thus compelling the Commonwealth to exercise its standing to obtain the declarations196. In the absence of a declaration of trust separately from the terms of the contract, the existence of a trust of promised contractual rights will depend upon identifying from the terms of the contract an expression of intention to create a trust197. The approach to the terms of the contract to identify any intention to create a trust is the objective approach which considers whether the meaning of the words used in all the circumstances would demonstrate an intention to create a trust by a reasonable person in the position of the parties, and an intention to undertake the duties of a trustee by a reasonable person in the position of the potential trustee198. The Commonwealth sought to rely, as a "starting point" for interpretation, upon English cases which had suggested that clear words are required "before an obligation on the part of the Crown or a servant or agent of the Crown, even if described as a trust obligation, will be treated as a trust according to ordinary principles"199. Those cases were based upon a separation between "governmental" 196 See Vandepitte v Preferred Accident Insurance Corporation of New York [1933] AC 70 at 79; Olsson v Dyson (1969) 120 CLR 365 at 391; Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 135, 155-156. 197 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 198 See, generally, Byrnes v Kendle (2011) 243 CLR 253 at 286-290 [102]-[115]. 199 Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145 at 162-163, citing Kinloch v Secretary of State for EdelmanJ obligations of the Crown involving "the duties or functions belonging to the prerogative and the authority of the Crown" in a relationship "not enforceable by the courts" in which expressions like "trust" were used in a "higher sense" and non-governmental obligations in which the same expression was used in a "lower sense" of the creation of a trust200. Such an interpretative principle was clearly rejected by this Court in circumstances where the putative trustee "has a number of functions, not all of which are necessarily governmental in nature"201. This reasoning applies a fortiori where, as in the Leases, none of the rights or obligations of the Commonwealth are governmental in nature in the prerogative sense described in the English cases. In many cases, the requirement that one party to the contract confer a benefit upon a third party may be an indicator that the other party manifested an intention to hold the benefit of the first party's promise on trust202. But it is only one indicium. All other indicia in these appeals point against any manifested intention by the Commonwealth to create a trust. In particular, as the Lessees submitted, cl 26.2(a) does not use the language of "trust" or holding the benefit of rights for another despite that language being used elsewhere in the Leases. Much can depend upon the nature of the right that is said to be held on trust. Unlike cl 26.2(c), where the Commonwealth could have a substantial role in administering the enforcement of the obligation upon the Lessees to make payments of the Commonwealth, on the arguable interpretation above, would have little role in administering or supervising the open-textured duty of the Lessees to use all reasonable endeavours to enter into an agreement with the Councils. the relevant Governmental Authorities, taxes the Even if, on its proper interpretation, cl 26.2(a) imposed a duty upon the Lessees, without agreement, to make payments in lieu of rates to the Councils, if the Commonwealth were to hold that promise on trust for the Councils then, as the Lessees submitted, it would have the curious effect that a trust would be created, superseded, and recreated each time an agreement with the Councils was India (1882) 7 App Cas 619 at 625-626 and Tito v Waddell [No 2] [1977] Ch 106 at 200 Tito v Waddell [No 2] [1977] Ch 106 at 216. 201 Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145 at 164. 202 Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 67; Bahr v Nicolay [No 2] (1988) 164 CLR 604 at 618. EdelmanJ concluded or terminated. That surprising and uncertain result is a strong basis for a conclusion that the words of cl 26.2(a) do not reveal that a reasonable person in the position of the parties would have intended to create a trust and that a reasonable person in the position of the Commonwealth would have intended to accept the responsibilities of a trustee. Does cl 26.2(a) create public rights enforceable by the Councils? The Councils relied on the decision of this Court in Edwards v Santos Ltd203 as founding their standing to seek declarations concerning the meaning of cl 26.2(a). In that case, this Court considered the question of standing to enforce a public right. One claim was that the first and third defendants, described as the "petroleum defendants", had "no right to apply to the Minister under s 40 of the Petroleum Act [1923 (Qld)] because the [Authority to Prospect] had ceased to be valid" and there was no power under s 40 of the Petroleum Act for the Minister to grant a "production licence"204. Heydon J205 (with whom five other members of the Court agreed206) held, citing Onus v Alcoa, that the plaintiffs had standing because they had an interest "which [was] greater than that of other members of the public". It is beyond argument from the issue that was involved, the test that was posed, and his reference to Onus v Alcoa that Heydon J was describing the test for standing to enforce a public right. Heydon J then continued, citing the decision of the Full Court of the Federal Court of Australia in Aussie Airlines Pty Ltd v Australian Airlines Ltd207 as "[a]n example of how a person can have standing to obtain a declaration"208. That decision, and its endorsement by Heydon J in the context of the enforcement of a public right, was the subject of much confusion in submissions in these appeals. In Aussie Airlines, Aussie Airlines sought to become an airline carrier in the Australian domestic airline industry. The two airlines in the industry at that time, Qantas and Ansett, had been granted long-term head leases for airport 203 (2011) 242 CLR 421. 204 (2011) 242 CLR 421 at 435-436 [37]. 205 (2011) 242 CLR 421 at 436 [37]. 206 (2011) 242 CLR 421 at 425 [1]. 207 (1996) 68 FCR 406. 208 Edwards v Santos Ltd (2011) 242 CLR 421 at 436 [38]. EdelmanJ facilities by a head lessor. The head leases contained provisions that compelled Qantas and Ansett to provide subleases to any "new entrant to the domestic aviation industry". Aussie Airlines alleged that it was a new entrant within the meaning of the head leases and sought a sublease from Qantas. Qantas denied that Aussie Airlines was a new entrant and refused to grant a sublease. One question which arose for the consideration of the Full Court of the Federal Court was whether Aussie Airlines had standing to seek a declaration as to whether it was a new entrant within the meaning of the head leases. The reasons of Lockhart J (with whom Spender and Cooper JJ agreed) commenced by considering whether Aussie Airlines had a private right. His Honour observed that, if Aussie Airlines had "enforceable rights under the head leases, there would be no doubt that it had standing to seek declaratory relief"209. But, since Aussie Airlines was not a party to the head leases, it could only have enforceable rights, by joinder of Qantas as a defendant, if the benefits of the promise concerning the grant of a sublease to any new entrant to the domestic aviation industry were held by Qantas on trust for Aussie Airlines210. That reasoning was entirely orthodox. However, Lockhart J went on to say that it was unnecessary to determine whether Aussie Airlines had any enforceable rights under the head leases because Aussie Airlines had "the requisite interest" to support its standing to obtain a declaration due to the "real practical importance" of the subleases to Aussie Airlines211. What was missing from this reasoning, although apparent from the context in which the case was considered in Edwards v Santos, was an explanation of why the right was a public right and not a purely private right. Although there was no argument on the point in Aussie Airlines, and no reasoning on the issue, there may be a basis for treating the rights under the head leases in Aussie Airlines as public rights as well as private rights. The relevant head lessee, Qantas, was not operating as a purely private party, nor was it assuming duties under the head leases in a purely private capacity. As Lockhart J observed, Qantas had acquired the whole of the issued share capital of Australian Airlines and was carrying on its business under the Australian Airlines (Conversion to 209 (1996) 68 FCR 406 at 414. 210 (1996) 68 FCR 406 at 414. 211 (1996) 68 FCR 406 at 415. EdelmanJ Public Company) Act 1988 (Cth)212. Further, as the primary judge explained213, the head leases were granted as part of a public policy of deregulation of the domestic aviation industry and a competition concern to enable new entrants into the domestic aviation industry by permitting them access to public infrastructure. The terms of the head leases required any sublessee to hold or have applied for licences under the Air Navigation Act 1920 (Cth) and the Air Navigation Regulations. The question whether Qantas was required to treat Aussie Airlines as a "new entrant to the domestic aviation industry" can thus be seen not merely as a matter of a private right between the head lessor and the head lessee but also as a duty that Qantas had assumed to the public generally. For these reasons, the decisions of Edwards v Santos and Aussie Airlines should be understood as concerned with standing to enforce public rights on the basis of a special interest above that of the general public rather than as exceptions to the rule that private rights are enforceable only by those who hold the relevant right. The Commonwealth submitted that the Lessees were in the same position as Qantas in Aussie Airlines and that these proceedings are not accurately described as involving purely private rights. It is true that the Leases were granted pursuant to legislation, namely s 22 of the Airports (Transitional) Act 1996 (Cth), and that cl 26.2(a), in relation to which the declarations are sought, was consistent with a government policy concerning competition. And the relevant undertaking by the Lessees in cl 26.2(a) concerned public bodies, the Councils. But cl 26.2(a) did not create any public rights. The undertaking by the Lessees as to their obligations in relation to the Councils was made only to the Commonwealth. The Lessees, as private parties, had no interest in making such undertakings to the public at large and had no duty to do so. They did not make any public undertaking. Further, if the proper interpretation of cl 26.2(a) of the Leases is that the Lessees have undertaken to the Commonwealth an obligation only to use reasonable endeavours to enter into an agreement with the Councils, then the suggestion that the Lessees made this undertaking to the public at large becomes even more far-fetched. The declarations sought Apart from their lack of standing, there may be further problems with the declaratory relief sought by the Councils. The relief sought assumed that the 212 (1996) 68 FCR 406 at 408. 213 See Aussie Airlines Pty Ltd v Australian Airlines Ltd [No 2] (1996) 67 FCR 451 at EdelmanJ Leases created a liability to make payments to the Councils in lieu of rates in accordance with criteria said to be set out in the applicable clause, namely cl 26.2(a). The Councils thus sought declarations in relevantly identical terms. The Clarence City Council sought declarations in the following terms: "(a) Upon a proper construction of clause 26.2 of [the HIAPL lease] entered into between the [Commonwealth] as Lessor, and [HIAPL] as Lessee, dated 10 June 1998 and granted in respect of the land known as the Hobart Airport (the Lease) the areas that must be included in the calculation of the ex-gratia rates equivalent payment includes each of the areas specified in attachment 'A' to the amended statement of claim; (b) A declaration that [HIAPL] is obliged to make payments to the applicant pursuant to clause 26.2 of the [L]ease: calculated in accordance with valuations made by the Valuer-General pursuant to the Valuation of Land Act 2001 and as set out in the valuation list; and as notified by the applicant in each rates notice issued by it to [HIAPL]. (c) A declaration that [HIAPL] has not correctly calculated the amount of each of the ex-gratia payments that it has made to the applicant in each of the financial years 2014/2015–2017/2018 inclusive pursuant to the Lease; and (d) Alternatively, a declaration as to how the ex-gratia payment in lieu of rates is to be calculated in accordance with clause 26.2 of the Lease." The foregoing relief reflects the substance of two disputes between the Lessees and the Councils214. The first dispute concerns the identification of those parts of the Airport Sites for which payments in lieu of rates are to be made. For that purpose, the meaning of the phrase "trading or financial operations" as used in cl 26.2(a) is in dispute. The second dispute concerns the correct valuation methodology to apply to determine the Lessees' liability. It engages with the following phrase used in cl 26.2(a): "being equivalent to the amount which would be payable for rates as if such rates were leviable or payable". The parties assumed 214 For completeness, the same two disputes also exist between APAL and the Northern Midlands Council. EdelmanJ that the correct meaning of each phrase of cl 26.2(a) is a matter about which a court may make declarations. For the reasons already given, that assumption may be mistaken. Even if the Councils had standing to seek the declarations on remittal of this matter, if the only obligation to which the Lessees are subject in cl 26.2(a) is to use reasonable endeavours to enter into an agreement with the Councils, then declarations in the nature of those sought by the Councils could not be made. The only declaration that the Councils could seek, as informed by the language of cl 26.2(a), would be about the content of the Lessees' promise to use "reasonable endeavours". Furthermore, a court should not make declarations that might inhibit the negotiations to be had between the Lessees and the Councils. Nor should a court make declarations that, in effect, write critical terms into a contract for the parties215. It follows that, even if the Councils had standing, on the interpretation of cl 26.2(a) that confines the Lessees' obligation to using reasonable endeavours to enter into an agreement with the Councils, the Councils would be in no position to seek declarations as if the words in cl 26.2(a) created criteria for liability that may be the subject of judicial determination. Rather, the Councils may only legitimately seek a declaration about the content of the Lessees' promise in cl 26.2(a) to use reasonable endeavours. On that interpretation, it will be a matter for the trial judge on remittal of this matter to determine what declarations, if any, may be made about the content of that promise. It may even be the case that the Lessees and the Councils ultimately find that they are not in disagreement about the content of that promise. The reference in the foregoing paragraph to what declarations "if any" might be made is a reference to the discretion retained by the court as to whether declarations should be ordered. In that respect, much will depend upon the content of the declarations that might be made. The Councils assert that declaratory relief will assist them in their negotiations with the Lessees. That statement warrants some scrutiny. That is because the Councils concede, properly, that they cannot enforce any declarations they might obtain against the Lessees. Because of this, practically speaking, as between the Councils and the Lessees, the parties will have obtained no more than non-binding relief, and the orders of a court will have no more substantive effect than an early neutral evaluation. Thus, if the Lessees were to state in negotiations that they did not accept the correctness of any relief obtained by the Councils, the most the Councils could then do would be to call upon the Commonwealth to intervene. In other words, declaratory relief will not 215 cf J Kitchen & Sons Pty Ltd v Stewart's Cash and Carry Stores (1942) 66 CLR 116 at 124; AMEV-UDC Finance Ltd v Austin (1986) 162 CLR 170 at 193; International Air Transport Association v Ansett Australia Holdings Ltd (2008) 234 CLR 151 at EdelmanJ arm the Councils with any legal rights they might deploy; the Councils will still only have what they presently retain, being a moral right to seek the assistance of the Commonwealth. In such circumstances, the granting of declaratory relief may be inutile. Conclusion In each appeal, orders should be made as follows: The appeal be allowed. (2) Of the orders made by the Full Court of the Federal Court of Australia, set aside orders 1 to 4 made on 6 August 2020 and orders 1 to 3 made on 11 September 2020 and, in lieu thereof, order that: the appeal be dismissed; and the appellant [each Council] pay the costs of the second respondent [HIAPL and APAL respectively]. The first respondent [each Council] pay the costs of the appellant [HIAPL and APAL respectively] in this Court.
HIGH COURT OF AUSTRALIA BANKSTOWN CITY COUNCIL APPELLANT AND ALAMDO HOLDINGS PTY LIMITED RESPONDENT Bankstown City Council v Alamdo Holdings Pty Ltd [2005] HCA 46 7 September 2005 ORDER Appeal allowed. Set aside orders 1 and 2 of the Court of Appeal of the Supreme Court of New South Wales entered on 12 October 2004 and in their place order: the appeal to that Court is allowed; and orders 1 - 5 of Gzell J made on 16 December 2003 are set aside and in their place order that the proceedings be dismissed. Appellant to pay the costs of the respondent of the appeal to this Court. Respondent's application for special leave to appeal is dismissed with costs. On appeal from the Supreme Court of New South Wales Representation: B W Walker SC with E G Romaniuk for the appellant (instructed by Marsdens) P Le G Brereton SC with J Stoljar for the respondent (instructed by Speed and Stracey) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Bankstown City Council v Alamdo Holdings Pty Ltd Nuisance – Local government – Drainage – Nuisance in exercise of statutory powers – Indemnity under Local Government Act 1993 (NSW), s 733 for acts or omissions done in good faith relating to the likelihood of land being flooded or the nature or extent of such flooding – Council constructed and operated drainage system whilst involved in the process of urbanisation – Drainage system caused flooding of adjacent land owned by respondent – Whether Council thereby incurred "liability in respect of" its conduct in constructing and operating drainage system – Whether Council acted "in good faith". Statutes – Construction – Council's statutory indemnity for conduct done in good faith relating to the likelihood or nature or extent of flooding – Whether indemnity precludes the grant of injunctive relief in addition to precluding award of damages for nuisance – Relevance of the objective of s 733 in protecting local government bodies – Relevance of the respective consequences of grant of damages and grant of injunctive relief – Relevance of discretionary nature of injunctive relief – Whether s 733 applies only to liability in respect of past events – Whether liability to injunctive relief is liability in respect of past events. Statutes – Construction – Council's statutory indemnity for conduct done in good faith relating to the likelihood or nature or extent of flooding – Where Council deferred the taking of immediate action respecting nuisance complained of by respondent – Whether "good faith" requires dishonesty or similar state of mind – Whether something more than negligence is required – Relevance of pending litigation to the character of the Council's conduct in deferring action. Injunctions – Mandatory injunctive relief – Relationship with grant of damages under Supreme Court Act 1970 (NSW), s 68 – Relevance to whether Council would have incurred any liability in respect of its conduct. Lord Cairns' Act – Availability of damages in lieu of injunction – Whether such damages readily calculable in money – Relevance to whether Council would have incurred any liability in respect of its conduct – Relevance to character of such liability. Words and phrases – "liability", "liability in respect of", "not incur any liability", "good faith". Local Government Act 1993 (NSW), ss 59A, 733. Supreme Court Act 1970 (NSW), s 68. GLEESON CJ, GUMMOW, HAYNE AND CALLINAN JJ. The appellant ("the Council") is a body corporate constituted as a council under the Local Government Act 1993 (NSW) ("the Act") for an area including the Sydney suburb of Chester Hill. The respondent ("Alamdo") owns land at Chester Hill ("the Land") upon which two industrial buildings are erected. The Land is situated at a low point of the local catchment. The Council is the owner of all works of stormwater drainage installed by the Council, whether or not the land in question is owned by the Council (s 59A(1) of the Act). The Council is empowered by s 59A(2) to operate, repair, replace, extend, expand and improve those works. Alamdo purchased the Land in 1988. Before it did so, Mr Maurici, the managing director of Alamdo, had been told of a recent incident involving the flooding for a brief period of both buildings. Thereafter, in January 1998 and April 2000, portions of the Land, including on the first occasion one of the buildings, were briefly flooded. For about 450 metres beside the Land stormwater is carried by an unlined channel which runs in part within an easement and in part within a drainage reserve. The Council operates a drainage system to the south of the Land which collects stormwater. Near the south-eastern boundary of the Land, the system contains what was called a "gross pollutant trap" or barrage which receives water from the outlet of two 2,400 mm stormwater pipes. Thereafter, water is directed into the unlined channel. The Supreme Court litigation In a suit heard in the Equity Division of the New South Wales Supreme Court1, Gzell J held that there had been a significant increase in the frequency with which the Land was likely to be inundated. In 1960, before the first of the buildings was constructed, flooding had been likely as something between a one in five year event and a one in 10 year event. By 1998, floodwaters would be likely to enter one of the buildings "at flow rates somewhat in excess of a one in two year event". This increased frequency of likely flooding diminished the activity to be planned for the Land and was an unreasonable interference with the use and enjoyment of the Land of the kind against which the action for private nuisance was directed. 1 Alamdo Holdings Pty Ltd v Bankstown City Council (2003) 134 LGERA 114. Gzell J rejected the submission by the Council that, because Alamdo had purchased the Land with knowledge of its flood-prone state, in the exercise of his discretion he should withhold injunctive relief. His Honour also rejected the Council's submission that there was such a disproportion between the cost to it of abating the nuisance (estimated as being at least $1.5 million) and the prospective damage suffered by Alamdo that injunctive relief should be refused. An injunction was granted restraining the Council from causing or permitting stormwater from inundating the Land "so as to cause a nuisance". The Council was ordered, without expense to Alamdo, to "carry out works to abate the nuisance", and to supply Alamdo with a detailed report of the steps it proposed to take to comply with that obligation. There is no issue in this Court respecting the form taken by this mandatory relief. Section 68 of the Supreme Court Act 1970 (NSW) ("the Supreme Court Act") empowered the Supreme Court to award damages "either in addition to or in substitution for" an injunction "against the commission or continuance of any wrongful act". This provision is the local representative of s 2 of Lord Cairns' Act 1858 (UK)2. These provisions extend even to an award of damages in place of an injunction where the plaintiff has moved quia timet and before any wrong has been committed. The damages are awarded "in respect of an injury which is still in the future"3. Gzell J made no provision for damages assessed by reference to the flood-prone nature of the Land and the consequent diminution in the value of the reversion; this was because his Honour considered that this injury would be rectified by the mandatory injunctive relief. The evidence suggested that the damages assessed by reference to that diminution of value would have been at least $1.4 million. At the trial, both parties approached the matter on the basis that the damages, being damages for nuisance, were readily ascertainable. This appears from the following passage in the trial judge's reasons: "The [Council] submitted that permanent damage to the reversion had not been established. But there was evidence from valuers on both sides and evidence from Mr Maurici that rental values were permanently affected by 2 21 & 22 Vict c 27. 3 Leeds Industrial Co-operative Society Ltd v Slack [1924] AC 851 at 860. the flood prone nature of the site. Mr Maurici said that the flooding had been mentioned by tenants in his negotiations over rent and they had demanded an attractive rental level. Kent Wood, the valuer called by the [Council], put a figure of $1,417,340 on the diminution in value of the reversion as a result of [Alamdo's] land being flood prone. Peter Byron, the valuer called by [Alamdo] put a higher figure on the damage to the reversion." No attention seems to have been paid to the fact that the claim for injunctive relief was a claim in the auxiliary jurisdiction and would ordinarily only be ordered if damages were not ascertainable or otherwise not an adequate remedy. Another curiosity was that Alamdo invited the trial judge to make an order that, if remedial works in accordance with a specification proposed by one of the experts were not completed by the Council within two years, then the Council should pay damages calculated by reference to the diminution in the value of the reversion in conformity with Alamdo's valuer's assessment. Gzell J declined this invitation and chose instead to grant mandatory injunctive relief. That there may have been some confusion with respect to the nature of the relief which could and should have been granted appears from this further passage in his Honour's reasons: "However, since those damages are limited to the diminution in the value of the reversion, which should be rectified by the abatement of the nuisance, I do not propose to order an inquiry as to damages." The fact that the relief ultimately granted was a mandatory injunction very much masked the true position that, if the Council were liable, its liability was readily calculable in money and was for damage which had already been done to the reversion. The Court of Appeal An appeal by the Council to the Court of Appeal (Spigelman CJ, Giles and Ipp JJA)4 failed, and a cross-appeal by Alamdo was dismissed. However, the mandatory injunctive relief is suspended pending the outcome of the appeal to this Court. 4 Bankstown City Council v Alamdo Holdings Pty Ltd (2004) 135 LGERA 312. The grounds of the appeal by the Council to the Court of Appeal were widely drawn but Spigelman CJ (who delivered the principal judgment) noted that some were abandoned. His Honour also remarked that the primary judge had not identified in express terms the act or condition performed by the Council, or for which it was responsible, which made the Council liable for the nuisance constituted by flooding. Whilst Gzell J had referred to the increased flow resulting from the urbanisation of the catchment area since 1930, he had not referred expressly to the significance for that urbanisation of development approvals by the Council. However, Spigelman CJ accepted that the primary judge was to be taken as having treated the relevant conduct of the Council as encompassing both the construction and operation of the drainage system and its role in the urbanisation process which had rendered the system less and less adequate. However, neither at trial nor in the Court of Appeal does attention appear to have been drawn to a line of authority marshalled by the English Court of Appeal in Marcic v Thames Water Utilities Ltd5. This indicates that a body such as the Council is not, without negligence on its part, liable for a nuisance attributable to the exercise of, or failure to exercise, its statutory powers. In this Court, it had been remarked by Gavan Duffy and Starke JJ in Metropolitan Gas Co v Melbourne Corporation6: "And though it was said in argument that the Company's claim was founded upon either trespass or nuisance or negligence, still the liability of the Corporation must depend upon whether, in the exercise of its statutory powers, it has acted negligently, so as to do unnecessary damage to the Company." The Court of Appeal rejected two submissions by the Council. The first was that the grant of injunctive relief, involving remedial measures at a cost of at least $1.5 million, had provided a disproportionate remedy in the circumstances of the case. The second was that the injunctive relief had been drawn in terms [2002] QB 929 at 988; revd on other grounds [2004] 2 AC 42. See also Hawthorn Corporation v Kannuluik [1906] AC 105, where the corporation was held to have been negligent in the planning of the original drains and in the construction from time to time of contributory channels. (1924) 35 CLR 186 at 197. See further the discussion of the authorities by Owen J in Benning v Wong (1969) 122 CLR 249 at 324-337. which were too broad. The Court also rejected the ground now relied on in this Court. The issues in this Court The Council confines its complaint to one only of the grounds unsuccessfully taken by it in the Court of Appeal. This ground is limited to what the Council contends is the exemption from liability provided by the Act. This is said to provide a complete answer to all of the relief granted against it in this litigation. That provision is found in s 733 of the Act, the text of which will be further considered below. On its part, Alamdo makes two answers. The first is that the protection afforded the Council by s 733 does not extend to exposure to injunctive relief. The second is that the Council could rely upon s 733 only if it established that it had acted in good faith within the meaning of the section and that it had failed to do so. Gzell J accepted both submissions. The Court of Appeal accepted the first but not the second. It held that Gzell J's finding of absence of good faith could not be sustained. Nevertheless, because the Court of Appeal upheld the first point, the appeal by the Council failed. In this Court, the submissions for the Council should be accepted and those of Alamdo rejected. The result is that the appeal by the Council should be allowed. We turn to explain why this should be the outcome. Section 733 of the Act The progenitor of s 733 was s 582A of the Local Government Act 1919 (NSW) ("the 1919 Act"). Section 582A was introduced in 1985 by the Local Government (Flood Liable Land) Amendment Act 1985 (NSW). In the Second Reading Speech in the Legislative Assembly on the Bill for that statute, the responsible Minister said that a principal purpose of the Bill was7: "to indemnify councils and other public authorities and their staff from liability from decisions taken in respect of flood liable land, provided that such decisions are made in accordance with government policy at the time". 7 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 16 April 1985 at 6025. Significantly, the Minister added that, without that protection, councils might continue to8: "adopt an unnecessarily conservative approach that sometimes leads to unnecessary refusal of development applications or the application of unnecessary and costly development and building conditions". Section 733 has been amended on several occasions since its introduction by the Act. The section applies to, and in respect of, "the Crown, a statutory body representing the Crown and a public or local authority constituted by or under any Act" (s 733(7)(a)). The central provision for this appeal is that in s 733(1). This provision applies, among other things, to advice furnished in a certificate under s 149 of the Environmental Planning and Assessment Act 1979 (NSW) ("the EPA Act") (s 733(3)(d))9, to consents and refusals of development applications under that statute (s 733(3)(a)), to "the carrying out of flood mitigation works" (s 733(3)(e)) and, generally, to any other thing done or omitted to be done in the exercise of the functions of a council under the Act or any other statute (s 733(3)(g)). The text of s 733(1) is as follows: "A council does not incur any liability in respect of: any advice furnished in good faith by the council relating to the likelihood of any land being flooded or the nature or extent of any such flooding, or anything done or omitted to be done in good faith by the council in so far as it relates to the likelihood of land being flooded or the nature or extent of any such flooding." The requirement of "good faith" is taken further by sub-ss (4), (5) and (6) of s 733. Sub-section (5) provides for the publication by the Minister for Planning of a manual relating to the management of "flood liable land", to be available for public inspection (s 733(6)). Sub-section (4) states: 8 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 16 April 1985 at 6025. 9 See Mid Density Developments Pty Ltd v Rockdale Municipal Council (1993) 44 FCR 290. "Without limiting any other circumstances in which a council may have acted in good faith, a council is, unless the contrary is proved, taken to have acted in good faith for the purposes of this section if the advice was furnished, or the thing was done or omitted to be done, substantially in accordance with the principles contained in the relevant manual most recently notified under subsection (5) at that time." For the present appeal, nothing turns directly upon these three sub-sections. "Not incur any liability" What then is the content of the phrase in the opening words of s 733(1) "not incur any liability"? As interpreted in the Court of Appeal, the relevant conduct of the Council was in the construction and operation of the drainage system, together with its role in the process of urbanisation. That related to the likelihood of the Land being flooded, or to the nature and extent of such flooding of the Land. Accordingly, that past conduct of the Council related to a state of affairs apt to develop in the future, namely, in the words of par (b) of s 733(1), "the likelihood of [the Land] being flooded" or to its "nature or extent". But, in respect of the conduct identified in this way, did the Council, but for s 733(1), "incur any liability"? What was said of the term "incurred" in a forerunner of s 51(1) of the Income Tax Assessment Act 1936 (Cth)10 by Dixon J in New Zealand Flax Investments Ltd v Federal Commissioner of Taxation11 is in point here. It would be unsafe to attempt an exhaustive definition of a conception such as "incur any liability" which is susceptible of various applications, given the normative complexity of the legal system, with the interaction between the rules of law, principles of equity, requirements of statute, and between legal, equitable and statutory remedies. Much must depend upon the subject, scope and purpose of s 733. 10 Section 23(1) of the Income Tax Assessment Act 1922 (Cth). 11 (1938) 61 CLR 179 at 207. The passage reads: "To come within that provision there must be a loss or outgoing actually incurred. 'Incurred' does not only mean defrayed, discharged, or borne, but rather it includes encountered, run into, or fallen upon. It is unsafe to attempt exhaustive definitions of a conception intended to have such a various or multifarious application. But it does not include a loss or expenditure which is no more than impending, threatened, or expected." This is not a case of construing a statutory provision which authorises government action such as that considered in Coco v The Queen12. There, a power to authorise entry onto premises to install and maintain a listening device was held not to extend to authorise an entry which otherwise would be a trespass. Nor is this a case of the protection of the interests of a statutory authority given privileges in the nature of a monopoly for provision of a public service, such as the postal service13. Nor is the present a case of the kind identified by McHugh J in Puntoriero v Water Administration Ministerial Corporation14 where general words of immunity are read down "so that they do not apply to functions of an ordinary character performed by the respondent and which are done pursuant to agreements with the consent of private citizens". Further, the objective of s 733 was not solely the protection of the funds of local government bodies. The Minister had pointed to the general inconvenience of unnecessary refusal of development applications, and imposition of the unnecessary and costly conditions upon approvals, by over-cautious councils. General statements, upon which Alamdo relied, calling for a narrow reading in immunity provisions of phrases such as "in respect of" do not provide a substitute for consideration of the subject, scope and purpose of the whole of the statutory text. Alamdo fixed upon further passages in the Minister's Second Reading Speech to which reference has been made above. These mentioned the need for protection against "claims for damages". That phrase, Alamdo submitted, indicates a legislative purpose to provide protection only against accrued causes of action carrying the right to the recovery of an award for damages. However, given the context in which the Minister spoke, it must be highly unlikely that any such technical use of words was intended. The circumstances of the present litigation illustrate the point. Is the perceived need of the Council for protection any the lesser where it is faced with an injunctive order requiring substantial expenditure for compliance than it would be if, in its discretion under s 68 of the Supreme Court Act, the Supreme Court had, in lieu of injunctive relief, awarded damages in a similarly significant 12 (1994) 179 CLR 427. 13 cf Suatu Holdings v Australian Postal Corporation (1989) 86 ALR 532. 14 (1999) 199 CLR 575 at 589 [37]. sum? The answer must be in the negative. The legislation is concerned in s 733 with matters of substance and not merely with matters of legal or procedural form. Given the past conduct of the Council, to which reference has been made in the discussion of par (b) of s 733(1), there was incurred liability "in respect of" that conduct. The Council was liable to the exercise of the equity jurisdiction of the Supreme Court, together with its statutory jurisdiction conferred by s 68 of the Supreme Court Act. Events had occurred which would authorise the Supreme Court to exercise its jurisdiction, albeit with discretion as to the grant and form of relief. Whether or not Alamdo may have been then entitled to recover damages on a cause of action for past invasion of its common law rights, it had an equity in the sense described by Gleeson CJ in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd15. The susceptibility of the Council to the adjudication of that equity was a liability which it had encountered, run into, or fallen upon and so one which, but for s 733(1), it had incurred16. To the equity suit commenced against it by Alamdo, the Council pleaded an immunity conferred by that provision. Subject to resolving in its favour any question of good faith, that was a good plea. In Crimmins v Stevedoring Industry Finance Committee17, Kirby J said of the word "liable": "[I]n some contexts, 'liable' will connote found liable in law. But in other contexts it will connote potentially or contingently or notionally liable if certain events occur or if a court were asked to determine the point". The expression in s 733(1) "not incur any liability" confers protection from liability in a general sense of "amenability to claims, or (to describe it from the opposite point of view) the range of the claims to the possibility of which the general principles of the law expose [a council]" in respect of any advice within par (a), or anything done or omitted to be done within par (b). The quoted words 15 (2001) 208 CLR 199 at 216 [8]. See also Hasham v Zenab [1960] AC 316 at 329. 16 cf New Zealand Flax Investments Ltd v Federal Commissioner of Taxation (1938) 61 CLR 179 at 207. 17 (1999) 200 CLR 1 at 68 [190]. See also the remarks of McHugh J at 52-53 [137]-[140] and of Hayne J at 90-91 [252]-[253]. are those of Kitto J in the particular statutory context dealt with in Scala v Mammolitti18. One limb of Alamdo's argument was that, because the injunction was a mandatory injunction and required performance in the future, it was a quite different remedy from a mere money remedy which would ordinarily only be awarded in respect of past quantifiable wrongs: that the latter was a liability of the kind against which s 733(1) of the Act immunised councils and stood therefore in stark contrast with the former. As we have already pointed out, the trial judge was invited, and would have been well able on the evidence, to assess and award damages as both parties contemplated he might and could do. It would be a curious result if the operation of s 733(1) of the Act could be avoided simply by substituting relief by way of mandatory injunction in the auxiliary jurisdiction in lieu of a readily quantifiable award of damages. In our opinion, this is a further matter arguing in favour of the construction of s 733(1) which is to be preferred. The importance which must be attached to context indicates the caution with which there must be approached holdings in cases upon statutes with a different subject, scope and purpose to that of s 733. This is borne out by consideration of some of the leading authorities relied upon in submissions in this appeal. Notice before action – the authorities In Brisbane City Council v Attorney-General of Queensland19, this Court considered a statute requiring notice before the bringing of an action against a local authority. One purpose of the legislation was disclosed by a provision for the tendering of amends within the notice period which, if not accepted, might later be pleaded20. Earlier, Bacon V-C had said of such a provision considered in Attorney-General v Hackney Local Board21: 18 (1965) 114 CLR 153 at 157. The case concerned the nervous shock provision in s 4(1) of the Law Reform (Miscellaneous Provisions) Act 1944 (NSW). 19 (1906) 4 CLR (Pt 1) 241. 20 See (1906) 4 CLR (Pt 1) 241 at 247. 21 (1875) LR 20 Eq 626 at 629. "The policy of the law is, that if these public bodies, entrusted with powers for public purposes, in the course of executing those powers shall happen to commit any inadvertence, irregularity, or wrong, then before anybody has a right to require payment from them in respect of that wrong they shall have an opportunity of setting themselves right; they shall have the period of a month for the purpose of making amends, or for restoring if they have taken away anything, and for paying for if they have done, any damage." In Brisbane City Council, Griffith CJ concluded that the statute referred to the past and "to something that has been done or omitted to be done before the action was brought, or intended to be done in the sense of referring to an act done with the intention of complying with the [statute]"22. A suit for an injunction to restrain commission of a nuisance might be commenced without the need for compliance with the notice provision. It was a claim for future protection. Griffith CJ went on to refer to English authority, Chapman, Morsons & Co v Guardians of the Auckland Union23, upon such a notice provision which applied that reasoning to an award of damages under Lord Cairns' Act in lieu of an injunction. This reasoning operated in a context which differs from that of s 733 of the Act. The same is true of the decision of the House of Lords in Graigola Merthyr Co Ltd v Swansea Corporation24. The Public Authorities Protection Act 1893 (UK) contained in s 125 a provision requiring notice before action with the added burden upon an unsuccessful plaintiff of a costs order to be taxed as between solicitor and client, here brought in at £70,000. This "statutory privilege" of defendants26 applied to the costs of an unsuccessful suit for quia timet injunctive relief. The 1919 Act contained in s 580 a six month "notice before action" provision. In Garlick v Council of Municipality of Wingham27, Long Innes J held 22 (1906) 4 CLR (Pt 1) 241 at 248. 23 (1889) 23 QBD 294; cf Harrop v Ossett Corporation [1898] 1 Ch 525. 25 Incompletely set out at [1929] AC 344 at 348. 26 The phrase used by Lord Buckmaster [1929] AC 344 at 352. 27 (1925) 26 SR (NSW) 9 at 14-15. that s 580 applied to an equity suit. Thereafter, in Thompson v Council of the Municipality of Randwick28, Nicholas CJ in Eq reached the contrary conclusion respecting s 580. He relied particularly upon the judgment of Bowen LJ in Chapman, Morsons & Co v Guardians of the Auckland Union29, which had not been cited to Long Innes J. These twists and turns of authority upon other provisions are of no decisive importance for the construction of s 733 of the Act and, indeed, tend to distract attention from that task. The decision in Attrill However, reference must be made to Attrill v Richmond River Shire Council30. The Court of Appeal accepted Attrill in preference to doubts expressed by Cripps AJ in Melaleuca Estate Pty Ltd v Port Stephens Shire Council31. In Attrill, Hodgson J was concerned not with a "notice before action" provision, but with s 582A of the 1919 Act, the predecessor of s 733. After referring to authorities already mentioned and others dealing with "notice before action" provisions, his Honour said that it was possible that the term "liability" in s 733(1) could extend to a liability to be ordered to do something32. Hodgson J "However, the liability which s 582A deals with is relevantly a liability in respect of 'anything done or omitted to be done'. That is, it is a liability in respect of past events. The question arises whether an injunction, whether prohibitory or mandatory, is correctly regarded, for the purposes of this section, as a liability in respect of past events. 28 (1944) 44 SR (NSW) 455. 29 (1889) 23 QBD 294 at 303. 30 (1993) 30 NSWLR 122; appeal dismissed on other grounds (1995) 38 NSWLR 31 [2004] NSWSC 415 at [70]. 32 (1993) 30 NSWLR 122 at 127. 33 (1993) 30 NSWLR 122 at 127. Injunctions are generally directed towards requiring or preventing future events, which would themselves be wrongful (in a broad sense). Those future events must, by evidence in the case, be shown to be reasonably probable; and the usual way of doing this is to lead evidence of actions performed in the past by the defendant. But it seems to me that that is essentially an evidentiary matter: however the probability of some future wrong is established, it is to this future state of affairs that the order is directed. It seems to me that that sort of order, directed towards future states of affairs, does not fall within the words 'any liability in respect of anything done or omitted to be done' within s 582A." His Honour concluded as follows34: "So, my view is that the protection in s 582A certainly extends to protecting the council from liability for damages in respect of past events. In my view, it does not extend to protecting the council from prohibitory or mandatory injunctions based solely on the probability of future events. While I do not think I need to decide this for the purpose of determining the particular question before me in these proceedings, I think it probably does not prevent the award of damages in lieu of such injunctions, provided those damages are limited to compensation for events occurring after the commencement of proceedings: that seems to be substantially the view taken in the Chapman Morson's case." The propositions that (1) injunctions are generally directed towards requiring or preventing future events and (2) evidence of actions performed in the past by the defendant will show that which is apprehended to be reasonably probable, may be accepted. But this does not deny that the susceptibility of a defendant to suffer equitable relief quia timet may be said to be in respect of what has already been done by the defendant. That which presents the threat has already occurred. The equity which the plaintiff has in such circumstances is not equated with an accrued right to sue on a cause of action at law in contract or tort. Equity responds to threats of future injury to legal or equitable rights. Take the case of an anticipatory repudiation of a contract for the sale of land, before the time for performance has arrived, where the other party elects not to accept the repudiation. This party has at that stage no cause of action for damages but has 34 (1993) 30 NSWLR 122 at 127-128. an equity forthwith to relief establishing that the contract ought to be specifically performed and carried into execution35. Once it is appreciated that the phrase in s 733(1), "not incur any liability", confers protection from amenability to the range of claims to which the general principles of law expose a council in respect of anything it has done or omitted to do within the scope of par (b), the limitation suggested by Attrill is shown to lack foundation in the statute. Good faith Although the Court of Appeal accepted Attrill, it did favour the case put by the Council respecting good faith, a holding which Alamdo attacks. There thus remains the matter of the acts or omissions of the Council being "in good faith". The expression appears twice in s 733(1), once in par (a), where the text is "any advice furnished in good faith", and once in par (b), where the text is "anything done or omitted to be done in good faith". Section 733(4) provides that, in the limited circumstances explained earlier in these reasons, which can apply only to the furnishing of advice, the Council is to be taken to have acted in good faith, unless the contrary is proved. Otherwise, the pleading by the Council of an immunity pursuant to s 733, as occurred in this litigation, entails a burden upon the Council of making out its case for the operation of that section in its favour. It is accepted by the Council that this includes the element of good faith, but Alamdo submits that there has been a failure in this respect which necessitates the dismissal of the appeal by the Council to this Court. Something first must be said respecting the sense in which the phrase "in good faith" is used in s 733(1)(b). Mid Density Developments Pty Ltd v Rockdale Municipal Council36 concerned the absence of any adequate system for the council to respond, when issuing certificates under s 149 of the EPA Act, to questions by the vendor and later the purchaser respecting the flooding of the particular land under contract. In that setting, it was held that, whilst not dishonest, the council had not acted in good faith. There had been no attempt to 35 See Turner v Bladin (1951) 82 CLR 463 at 472; Hasham v Zenab [1960] AC 316 at 36 (1993) 44 FCR 290. supply information by recourse to the council's records and there was no system in operation for doing so. Indeed, the council officer whose responsibility it was to deal with the requests for information had consciously ignored the very records which would have supplied it37. Reference was made in Mid Density to various examples in the law where "good faith" is used as a criterion requiring some state of mind or knowledge other than the personal honesty and absence of malice of the relevant actor38. Moreover, given the range of advice, acts and omissions to which s 733(1) may apply, what is required for something to be done or omitted in good faith may vary from one case to the next. This makes it unwise, if not impossible, to place a definitive gloss upon the words of the statute. In Mid Density, the standard of conduct against which the Council's conduct in issuing the s 149 certificates was to be assessed was apparent from the importance of the information sought for the routine processes of conveyancing. The present case stands quite differently in several respects. First, the nature of the nuisance complained of was clarified only in the Court of Appeal, and then recognised as encompassing the involvement of the Council over many years in the construction and operation of the drainage system and its role in the process of urbanisation. Given the vagueness of the complaints against the Council, the weight of its evidentiary burden to establish good faith was correspondingly lightened. Secondly, that was all the more so given that, without negligence on its part in the exercise or failure to exercise its statutory powers, the Council was not liable in nuisance. True enough that point was not taken as an answer to liability, but it cannot properly be shut out of consideration of the content of the requirement of good faith in this case. Here, something more than negligence is necessary because, unless negligence were present, there would be no liability for protection against which s 733(1) was required by the Council. The Council led evidence at trial from Mr Morrison, the Manager of Roads and Infrastructure with the Council and he was cross-examined. The evidence in chief included voluminous records of the Council. Given the nature of the nuisance alleged against the Council, the material would, unless challenged, suggest both no failure on its part which was to be stigmatised as a want of good faith, and the presence of good faith as a positive attribute of the conduct of the Council over a long period. 37 (1993) 44 FCR 290 at 300. 38 (1993) 44 FCR 290 at 298-299. However, the primary judge held that the Council had not acted in good faith in the circumstances. His Honour referred to steps taken by the Council to respond to concerns expressed to Mr Morrison by Mr Maurici at a meeting on site in or about July 1998. Gzell J emphasised the importance attached by Mr Morrison to the pending litigation as a reason for deferring the taking of immediate action by the Council. The litigation commenced in May 1999. His Honour concluded: "Its abandonment of any further investigation pending the outcome of these proceedings put [the Council] in my view, outside the protection of The Court of Appeal disagreed with that conclusion, and Alamdo, by its Amended Notice of Contention, challenges that outcome in the Court of Appeal. Spigelman CJ noted that Gzell J had expressly based his conclusion only on the inaction of the Council beginning in about February 1999 and concluded that, while the Council had the onus of proving good faith, the evidence to the contrary was an inadequate basis for the adverse finding. The Chief Justice noted the absence of consideration of any link between the litigation and the ordering of the priorities of the Council. There was discussion in the argument in this Court of the significance of passages in the judgment of Spigelman CJ said to show that he misunderstood the placing of the burden upon the Council to show good faith, rather than upon Alamdo to show its absence. An examination of his Honour's judgment shows that any apparent infelicities of expression indicate no more than a response to the shape the issues had taken at trial. The presence of good faith had come to be assumed unless Alamdo made good its destructive response, as the primary judge held it had. The emphasis upon the significance to the Council of the pending litigation advanced its case for good faith, not the case of Alamdo to the contrary. It must be remembered that, as Mr Morrison explained in his oral evidence in chief, the established procedures of the Council with respect to proposals for infrastructure expenditure involved consideration of the relative priority of all projects. Where, depending upon the outcome of litigation which the Council was defending, the Council might have no responsibility in law to make an expenditure, prudence would support deferral. Section 733(1) protects such an approach as an exercise in good faith of the Council's powers. The holding at first instance to the contrary cannot be supported. Section 733(1) applied in this case. Special leave application This conclusion renders otiose the special leave application in which Alamdo seeks damages in addition to the injunctive relief granted at trial. That application should be dismissed with costs. Orders on the appeal The appeal should be allowed. Orders 1 and 2 of the orders of the Court of Appeal should be set aside. In place thereof, the appeal to that Court should be allowed, the orders of Gzell J entered on 12 October 2004 be set aside and the proceedings be dismissed. Special leave was granted by this Court upon an undertaking by the Council to pay Alamdo's costs of the appeal in any event, and not to seek to disturb costs orders in favour of Alamdo in the Courts below. Accordingly, the only costs order now to be made is that the appellant pay the costs of the respondent of the appeal to this Court. McHugh 61 McHUGH J. I agree that this appeal should be allowed. In my opinion, s 733(1) of the Local Government Act 1993 (NSW) ("the Act") applies to, and gives a Council immunity from, injunctive relief sought in a Court of Equity in its auxiliary jurisdiction as enhanced by statutes such as s 68 of the Supreme Court Act 1970 (NSW). The facts and issues are set out in the joint judgment of Gleeson CJ, Gummow, Hayne and Callinan JJ. I need not repeat them. Section 733(1) declares that: "A council does not incur any liability in respect of: anything done or omitted to be done in good faith by the council in so far as it relates to the likelihood of land being flooded or the nature or extent of any such flooding." As the joint judgment shows, the "past conduct of the Council"39 "in the construction and operation of the drainage system, together with its role in the process of urbanisation"40 made the Council "liable to the exercise of the equity jurisdiction of the Supreme Court, together with its statutory jurisdiction conferred by s 68 of the Supreme Court Act"41 because "[e]vents had occurred which would authorise the Supreme Court to exercise its jurisdiction, albeit with discretion as to the grant and form of relief"42 and because the plaintiff "had an equity in the sense described by Gleeson CJ in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd"43. The result was that "[t]he susceptibility of the Council to the adjudication of that equity was a liability which it had encountered".44 39 Reasons of Gleeson CJ, Gummow, Hayne and Callinan JJ at [26]. 40 Reasons of Gleeson CJ, Gummow, Hayne and Callinan JJ at [26]. 41 Reasons of Gleeson CJ, Gummow, Hayne and Callinan JJ at [32]. 42 Reasons of Gleeson CJ, Gummow Hayne and Callinan JJ at [32]. 43 Reasons of Gleeson CJ, Gummow, Hayne and Callinan JJ at [32] (footnote omitted). 44 Reasons of Gleeson CJ, Gummow, Hayne and Callinan JJ at [33]. McHugh Alamdo Holdings Pty Limited ("Alamdo Holdings") contended that injunctive relief was not a "liability" for the purpose of s 733 of the Act because, unlike a common law award of damages, "[n]o 'right' to such a discretionary remedy is enlivened by the act or omission of a defendant; whereas a right to damages is enlivened by a relevant act or omission of the defendant." But as the joint judgment shows, there were two senses in which "[t]he susceptibility of the Council to the adjudication of that equity was a liability which it had encountered"45. And those two senses accord with the first and third senses of the term "liability" described by Windeyer J in Ogden Industries Pty Ltd v Lucas46 that Alamdo Holdings cited in submissions to this Court. Moreover, a Hohfeldian rights analysis, upon which Alamdo Holdings also relied, denies Alamdo Holdings' argument that the equitable relief that it sought and obtained was not a "liability" within the meaning of s 733. That analysis demonstrates that the Council had a "liability" as a corollary of the following two "Hohfeldian rights": the corollary of the Supreme Court's power to exercise its equitable jurisdiction to grant the injunctive relief is that the defendant had a liability to have its legal position changed by the grant of the injunction. Thus, the existence of the power entailed the third sense of "liability", which was "a situation in which a duty or obligation can arise as the result of the occurrence of some act or event"47, namely, the granting of the relief; and the corollary of Alamdo Holdings having an equitable right that the Council not do acts or omit to do acts relating to the likelihood of land being flooded is that the Council had a duty to do acts or not to do those acts. Thus, the existence of the equitable right entailed the first sense of "liability", which was "a legal obligation or duty"48. Accordingly, the injunctive relief that Alamdo Holdings sought against the Council was a "liability" within the meaning of s 733(1)(b) of the Act. For the reasons given by Gleeson CJ, Gummow, Hayne and Callinan JJ, the Council also acted in good faith within the meaning of s 733(1)(b). Consequently, the conduct of the Council, relevant to the action brought by Alamdo Holdings, was conduct "done or omitted to be done in good faith by the 45 Reasons of Gleeson CJ, Gummow, Hayne and Callinan JJ at [33]. 46 (1967) 116 CLR 537 at 584. 47 (1967) 116 CLR 537 at 584 (emphasis added). 48 Ogden Industries Pty Ltd v Lucas (1967) 116 CLR 537 at 584. McHugh council in so far as it relates to the likelihood of land being flooded or the nature or extent of any such flooding." The Council was therefore entitled to the immunity provided by s 733. The appeal should be allowed. Allowing the appeal for the above reasons also has the effect that Alamdo Holdings' special leave application must be rejected. Orders I agree with the orders proposed by Gleeson CJ, Gummow, Hayne and
HIGH COURT OF AUSTRALIA APPELLANT AND COMMISSIONER OF TAXATION & ANOR RESPONDENTS Bosanac v Commissioner of Taxation [2022] HCA 34 Date of Hearing: 16 August 2022 Date of Judgment: 12 October 2022 ORDER Leave to amend the Notice of Contention refused. Appeal allowed. Set aside the orders of the Full Court of the Federal Court of Australia made on 31 August 2021 and 31 January 2022 and, in their place, order that: the appeal be dismissed; and the appellant pay the second respondent's costs. On appeal from the Federal Court of Australia Representation N C Hutley SC with J E Hynes and T L Bagley for the appellant (instructed J O Hmelnitsky SC with D P Hume and J S Slack-Smith for the first respondent (instructed by Australian Government Solicitor) R A Blow for the second respondent (instructed by Cove Legal) – submitting appearance Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Bosanac v Commissioner of Taxation Trusts – Resulting trust – Presumption of resulting trust – Presumption of advancement – Where wife purchased property – Where purchase price paid from joint loans taken in names of wife and husband – Where security for joint loans from separately owned properties – Where title registered in name of wife only – Where husband never claimed interest in property – Where property matrimonial home – Where history of separate ownership of assets – Where presumption of advancement precludes presumption of resulting trust from arising – Whether presumption of resulting trust over one half of property in favour of husband – Whether objective intention of wife and husband for husband to have beneficial interest in property – Whether presumption of advancement remains part of general law of Australia. Words and phrases – "beneficial interest in property", "benefit of another", "circumstance of fact", "circumstance of evidence", "inference", "intention", "objective trust", "presumption of advancement", "presumption of fact", "presumption of law", "presumption of resulting trust", "proof of intention", "purchase money resulting trust", "relationship of husband and wife", "spouses", "strength of the presumptions". to create a intention KIEFEL CJ AND GLEESON J. This appeal concerns the purchase by Ms Bosanac of a residential property in Perth ("the Dalkeith property") in 2006. She and Mr Bosanac married in 1998. They separated in 2012 or 2013 but continued to reside together at the Dalkeith property until September 2015, when Mr Bosanac moved to a new residential address. Ms Bosanac appears to have instigated the purchase of the Dalkeith property. In April 2006 she offered to purchase it for $4,500,000 subject to her obtaining approval for a loan of $3,000,000 from a bank. The offer was accepted in May 2006. The contract for sale required Ms Bosanac to pay a deposit of $250,000 within 30 days. The deposit was provided from an existing joint loan account in the names of Ms and Mr Bosanac. In October 2006, Ms and Mr Bosanac applied for two loans in the sums of $1,000,000 and $3,500,000. The balance of the purchase price was paid from two loan accounts in their joint names, and after settlement the surplus funds in these accounts were paid into the joint loan account from which the deposit had been drawn. The Dalkeith property was registered in Ms Bosanac's name alone. Mr Bosanac has never claimed an interest in the property. The securities required by the bank for the loans were mortgages over the Dalkeith property and three other properties – units at Mount Street and a property at Hardy Street. The unit at 10/41-43 Mount Street was owned by Mr Bosanac. Ms Bosanac owned the Hardy Street property. The Dalkeith and Hardy Street properties were used as securities again almost a year later when the loans were refinanced. The primary judge in the Federal Court, McKerracher J, found that during the marriage Ms and Mr Bosanac shared some bank accounts, but had substantial assets which they held in their separate names. Mr Bosanac had a substantial share portfolio. There was evidence of the use of separately owned properties as security for joint loans. There is nothing to suggest they were used to acquire joint assets. His Honour said, "this does not appear to be an instance of a husband and wife sharing all of the matrimonial assets jointly, or pooling their shareholdings … [although] … some bank accounts were shared"1. Mr Bosanac was represented on this appeal, as he had been in the proceedings below, but he took no active part in it. Neither he nor Ms Bosanac gave evidence at the hearing before the primary judge. 1 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 84 [57]. Gleeson The reasoning below The Commissioner is a creditor of Mr Bosanac. The primary judge noted that there was no suggestion that the Dalkeith property was registered in Ms Bosanac's name alone with a view to Mr Bosanac avoiding his commitments to his creditors. The Commissioner brought proceedings seeking a declaration of a resulting trust over the equity in one-half of the Dalkeith property, which is to say that Ms Bosanac held that interest in the property on trust for Mr Bosanac. The Commissioner sought to take advantage of the law's presumption, known as a presumption of resulting trust, that a person who advances purchase monies for property, which is held in the name of another person, intends to have a beneficial interest in the property2. That presumption is subject to an exception that, in the case of purchases by a husband in the name of a wife, or a parent (or person who stands in loco parentis) in the name of a child, there is a presumption of advancement or, in other words, a presumption that the purchaser intended that the beneficial interest would pass with the legal interest3. The Commissioner contended that the presumption of advancement of a wife by her husband, which operates to preclude a resulting trust from arising, is no longer part of the law of Australia in relation to the matrimonial home following the decision of this Court in Trustees of the Property of Cummins v Cummins4. The primary judge dismissed the Commissioner's application5. His Honour held that the presumption of advancement in relation to the matrimonial home was not precluded by Cummins, and arose in Ms Bosanac's favour. The evidence did not support an inference that Mr Bosanac intended to have an interest in the Dalkeith property and the presumption of advancement stands unrebutted. In that regard, his Honour observed that at the time of the registration of the property in Ms Bosanac's name, Mr Bosanac was a sophisticated businessman, a "self-styled venture capitalist", who may be taken to have appreciated the significance of the name in which real property is held6. The Full Court (Kenny, Davies and Thawley JJ) took a different view. Their Honours held that the decision in Cummins did not qualify the presumption of 2 Calverley v Green (1984) 155 CLR 242 at 246. 3 Napier v Public Trustee (WA) (1980) 55 ALJR 1 at 3; 32 ALR 153 at 158. See Nelson v Nelson (1995) 184 CLR 538 at 547-548. (2006) 227 CLR 278 at 302-303 [71]. 5 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74. 6 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 131 [231]. Gleeson advancement, but the presumption is liable to be displaced or rebutted by evidence, including evidence of the nature of the particular transaction7. There were facts which tended strongly against the presumption and in favour of a trust being intended by both Ms and Mr Bosanac: Mr Bosanac assumed a substantial liability without acquiring any beneficial interest8; the Dalkeith property was intended to be the matrimonial home for the joint use and benefit of Ms and Mr Bosanac9; and the funds for the purchase came from joint borrowings10. The Full Court declared that Ms Bosanac holds 50 percent of her interest in the Dalkeith property on trust for Mr Bosanac. Ms Bosanac appeals from the decision of the Full Court pursuant to a grant of special leave. Ms Bosanac contends that the Full Court should have found, as the primary judge did, that there was no basis to infer that Mr Bosanac had an intention to have a beneficial interest in the property. The presumptions A trust of a legal estate in property taken in the name of another is taken to "result" to the person who advances the purchase money11. The categories of resulting trust include trusts arising from A's payment for the conveyance of rights to B; the voluntary transfer of rights inter vivos from A to B; and the transfer of rights on a failed declared trust. The term "resulting trust" states a legal response to proved facts12. The presumption of a resulting trust developed by analogy from the rule of the common law that where a feoffment, or conveyance, is made without consideration, the feoffment results to the feoffer13. It arose from the common practice of the 15th to 17th centuries of those having fee simple estates in land to put them in use (the precursor to the trust) for themselves14. Because words of trust 7 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [10]-[11]. 8 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [15]. 9 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [19]. 10 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [20]. 11 Dyer v Dyer (1788) 2 Cox 92 at 93 [30 ER 42 at 43]. 12 Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 13 Dyer v Dyer (1788) 2 Cox 92 at 93 [30 ER 42 at 43]. 14 Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at Gleeson were not included on the face of the conveyance and because the transfers were gratuitous, the court supplied a presumption of a declaration to uses15. There were various advantages to the practice, including avoiding the hardship of feudal times, and avoiding escheat and forfeiture to the Crown in time of war, such as the Wars of the Roses16. The presumption can be rebutted by evidence from which it may be inferred that there was no intention on the part of the person providing the purchase money to have an interest in land (or other property) held on trust for him or her17. The presumption cannot prevail over the actual intention of the party paying the purchase price as established by the overall evidence18, and where more than one person pays the purchase price, as here, regard is necessarily had to evidence of each of their intentions. The presumption of advancement allows an inference as to intention to be drawn from the fact of certain relationships19. It applies to transfers of property from husband to wife and father to child, but in Nelson v Nelson20 this Court accepted that there is no longer any basis for maintaining a distinction between a father and mother so far as concerns transfers of property to a child. Originally the to afford "good relationships were considered by consideration" for the conveyance, but a rationale for the presumption has come to be found in the prima facie likelihood that a beneficial interest is intended in situations to which the presumption has been applied21. themselves sufficient On one view, the presumption of advancement is not strictly a presumption at all. It may be better understood as providing "the absence of any reason for 15 Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 16 Anderson v McPherson [No 2] (2012) 8 ASTLR 321 at 338 [110]-[112]. 17 Stewart Dawson & Co (Vict) Pty Ltd v Federal Commissioner of Taxation (1933) 48 CLR 683 at 690; Calverley v Green (1984) 155 CLR 242 at 251; Nelson v Nelson (1995) 184 CLR 538 at 547. 18 Muschinski v Dodds (1985) 160 CLR 583 at 612. 19 Nelson v Nelson (1995) 184 CLR 538 at 547. (1995) 184 CLR 538 at 548-549, 576, 585-586, 601. 21 Wirth v Wirth (1956) 98 CLR 228 at 237. Gleeson assuming that a trust arose"22. At an evidentiary level, it is no more than a circumstance which may rebut the presumption of a resulting trust23 or prevent it from arising24. It too may be rebutted by evidence of actual intention25. In the United Kingdom, s 199 of the Equality Act 2010 (UK) is expressed to abolish the presumption of advancement on the basis that it involves unlawful discrimination, but it has not yet been brought into effect. The presumption therefore remains. It has been observed that it may not make much real difference to the relative positions of husbands and wives, since the approach in recent cases is to seek to determine the real intentions of the parties26. This Court's decision in Nelson reflects views about a more modern society. In that case, Dawson J27 observed that there was no reason now to suppose that the probability of a parent intending to transfer a beneficial interest in property to a child is any the less the case with respect to a mother than a father. Toohey J pointed to current family law legislation respecting the obligation of parents to maintain children28. The decision in Nelson might be thought to raise the question whether, assuming the presumption of advancement is to be maintained, it should now apply to transfers of property not just from wife to husband, given the position that many wives now have respecting income and property, but also as between spouses more generally given the recognition by statute of de facto relationships in proceedings concerning property29 and same-sex marriage30. 22 Martin v Martin (1959) 110 CLR 297 at 303; see also Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 298 [55]. 23 Pettitt v Pettitt [1970] AC 777 at 814. 24 Wirth v Wirth (1956) 98 CLR 228 at 237. 25 Calverley v Green (1984) 155 CLR 242 at 251. 26 McGhee and Elliott, Snell's Equity, 34th ed (2020) at [25-007]. 27 Nelson v Nelson (1995) 184 CLR 538 at 575. 28 Nelson v Nelson (1995) 184 CLR 538 at 586. 29 Family Law Act 1975 (Cth), ss 90SM and 90SS, inserted by Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008 (Cth); compare Calverley v Green (1984) 155 CLR 242 at 260, referring to Family Law Act 1975 (Cth), ss 79 and 80. 30 See Marriage Amendment (Definition and Religious Freedoms) Act 2017 (Cth). Gleeson Important as these matters are, they were not in issue on this appeal and were not the subject of any argument. The question which arises on this appeal is common to both presumptions. It concerns the intention of Ms and Mr Bosanac when the property was registered in Ms Bosanac's name. And relevant to both presumptions is what weight they may now have. The weight of the presumptions The maintenance of either presumption, especially that of advancement, has been the subject of commentary and criticism. In Calverley v Green31, Gibbs CJ pointed out that they do not always lead to a result which is what would be expected in ordinary human experience and gave as an example the circumstance of a woman making deposits of money for her niece and nephew. His Honour observed, with respect to the presumption of a resulting trust, that it would not usually be thought that the niece and nephew were to hold the monies on trust for her. In Dullow v Dullow32, Hope JA (Kirby P and McHugh JA agreeing) expressed the view that it "seems rather ridiculous that troubles in England at the end of the Middle Ages should be the basis, in the late twentieth century, for making findings of fact". In Calverley v Green33, Gibbs CJ considered that the principle on which the presumption of advancement rests was not "convincingly expounded in the earlier authorities". Lord Reid, in Pettitt v Pettitt34, was of a similar view. His Lordship said that it was unclear how it first arose: either the judges who first applied it thought that husbands so commonly made gifts to their wives that they simply assumed it, or that wives' economic dependence made it necessary as a matter of public policy to give them this advantage. Lord Reid then observed that "[t]hese considerations have largely lost their force under present conditions, and, unless the law has lost all flexibility so that the courts can no longer adapt it to changing conditions, the strength of the presumption must have been much diminished". This must surely be correct. It is the concern of the courts to determine what was intended when property was purchased or transferred. It may once have been the case that evidence capable of rebutting the presumptions was not available. That is unlikely to be so today, especially in the context of dealings as between spouses where the relationship has (1984) 155 CLR 242 at 248-249. (1985) 3 NSWLR 531 at 535. (1984) 155 CLR 242 at 248. [1970] AC 777 at 792-793. Gleeson been of sufficient length to permit a court to observe how the spouses have dealt with property as between themselves and managed their affairs. This evidence may take many forms, but it has always been understood that the strength of the presumptions will vary from case to case depending on the evidence. The presumption of advancement, understandably, is especially weak today. In Pettitt, Lord Hodson35 considered that when evidence is given it will not often happen that the presumption will have any decisive effect. In the same matter, Lord Upjohn considered that given both presumptions are but a mere circumstance of evidence, they may readily be rebutted by comparatively slight evidence36. The Notice of Contention and its amendment The Commissioner, by Notice of Contention, contends that the Full Court was wrong to find, in effect, that where a husband and wife purchase a matrimonial home, each contributing to the purchase price, and title is taken in the name of one of them only, it is not to be inferred that each of the spouses would have a one-half interest in the property. The Commissioner relies upon what was said in the reasons of this Court in Cummins37 in support of the contention. There, after referring to the presumption of advancement, the Court said38: "The present case concerns the traditional matrimonial relationship. Here, the following view expressed in the present edition of Professor Scott's work respecting beneficial ownership of the matrimonial home should be accepted39: 'It is often a purely accidental circumstance whether money of the husband or of the wife is actually used to pay the purchase price to the vendor, where both are contributing by money or labor to the various expenses of the household. It is often a matter of chance whether the family expenses are incurred and discharged or 35 Pettitt v Pettitt [1970] AC 777 at 811. 36 Pettitt v Pettitt [1970] AC 777 at 814. 37 Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278. 38 Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 302-303 39 Scott, The Law of Trusts, 4th ed (1989), vol 5, §454 at 239. Gleeson services are rendered in the maintenance of the home before or after the purchase.' To that may be added the statement in the same work40: 'Where a husband and wife purchase a matrimonial home, each contributing to the purchase price and title is taken in the name of one of them, it may be inferred that it was intended that each of the spouses should have a one-half interest in the property, regardless of the amounts contributed by them.'" The Commissioner relies on the second statement as displacing or qualifying the presumption of advancement. But to give it that effect would be to elevate what Professor Scott said to a statement of principle or another presumption when there is nothing to suggest the Court was concerned to do so. Professor Scott was referring to a possible inference which might be drawn from particular circumstances. And it is noteworthy that the cases cited by him in his text in this connection were concerned with the exercise of the discretion in cases brought under the Married Women's Property Act 1882 (UK) (45 & 46 Vict c 75). Moreover, the Commissioner's contention does not have regard to the facts in Cummins and the issues with which the Court was dealing. Cummins concerned property which included the matrimonial home of Mr and Mrs Cummins. The title to it had originally been taken in their joint names. The importance of that fact is evident from the opening words of the paragraph which follows that relied upon by the Commissioner41: "That reasoning applies with added force in the present case where the title was taken in the joint names of the spouses." The husband then transferred his legal and beneficial interest in the matrimonial home to his wife with the intention of placing it beyond the reach of his creditors, contrary to s 121(1)(b) of the Bankruptcy Act 1966 (Cth). The Court was concerned to determine what interest the parties should be taken to have where the financial contributions were unequal. Hence the reference to the first passage The holding in Cummins is that there was no occasion in that case for equity to fasten upon the registered interest held by joint tenants a trust obligation 40 Scott, The Law of Trusts, 4th ed (1989), vol 5, §443 at 197-198. 41 Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 303 [72]. Gleeson representing differently proportionate interests as tenants in common42. The case turned on the actual intention of Mr and Mrs Cummins to hold the property jointly. In addition to the observations by Professor Scott, the Court also had regard to the particular circumstances of the case: that it might be assumed that Mr and Mrs Cummins' solicitor advised them about taking title as joint tenants rather than as tenants in common; and the "conventional basis of their dealings which treated the matrimonial home as beneficially owned equally"43. The Commissioner now seeks to further contend that this Court should conclude that the general law does not recognise a presumption of advancement in relation to a benefit provided by a husband to a wife. In effect the Commissioner asks this Court to abolish the presumption of advancement on the basis that it has no acceptable rationale, and is anomalous, anachronistic and discriminatory. It is the Commissioner's position that absent the operation of the presumption of advancement, it would follow that there was no basis upon which the presumption of a resulting trust is or could be refuted in this case. The Commissioner needs leave to amend the Notice of Contention and to raise a question which has been dealt with by a majority of this Court in Nelson. In Nelson44, Deane and Gummow JJ regarded the presumptions as interrelated and entrenched "land-marks" in the law of property. They said that "[m]any disputes have been resolved and transactions effected on that foundation". Their Honours cited with approval the reasons of Deane J in Calverley v Green45 to this effect. Deane J there expressed the view that in the absence of knowledge as to what effect the abolition of the presumptions would have on existing entitlements, the better course is to leave any reform of this branch of the law to the legislature, a view with which McHugh J concurred in Nelson46. It is difficult to disagree with these views. But that is not to accept that the presumptions when applied will carry much weight. Much has changed with respect to the various ways in which spouses deal with property. When evidence of this kind is given, inferences to the contrary of the presumptions as to intention may readily be drawn. 42 Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 303 [72]. 43 Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 303 [73]. 44 Nelson v Nelson (1995) 184 CLR 538 at 548. (1984) 155 CLR 242 at 266. 46 Nelson v Nelson (1995) 184 CLR 538 at 602. Gleeson Proof of intention The question of intention is entirely one of fact, and concerns the intention manifested by the person or persons who contributed funds towards the purchase of the property. In Martin v Martin47, it was observed that for the most part it can be assumed that proof of intention will be made out by the circumstances. Reference was made48 to what had been said by Cussen J in Davies v The National Trustees Executors and Agency Co of Australasia Ltd49: "It is impossible to try to arrange into certain sets of categories certain facts, and say beforehand they will or will not become decisive or immaterial. The attention must be kept steadily fixed on the one fact in issue – What was at the time the intention of the purchaser or transferor? Anything which is relevant to that issue is admissible." Cussen J went on to say that evidence of that person's thinking at the time might be accepted, although it would be received "with caution". That circumstance does not arise for consideration in the present case. There is no direct evidence as to the intention of either Ms or Mr Bosanac. The question is what inference is to be drawn from the available facts and in particular the history of the parties' dealings with property. In Stewart Dawson & Co (Vict) Pty Ltd v Federal Commissioner of Taxation50, the transferor was not in loco parentis to his granddaughter to whom he transferred shares, so the presumption of advancement did not arise. The question was whether he intended her to hold them on trust for him, as might be presumed in the first instance. Regard was had by Dixon J to the evidence of their relationship, what the transferor had already paid on her behalf, and the provisions the transferor made for his family generally. From these facts a strong inference was drawn that he meant to give her the shares absolutely51. There was a history of Ms and Mr Bosanac holding their substantial real and other property in their own names. Consistently with this, it was evidently the desire of Ms Bosanac to purchase the Dalkeith property and have it registered in (1959) 110 CLR 297 at 304. 48 Martin v Martin (1959) 110 CLR 297 at 304. [1912] VLR 397 at 403. (1933) 48 CLR 683. 51 Stewart Dawson & Co (Vict) Pty Ltd v Federal Commissioner of Taxation (1933) 48 CLR 683 at 691-692. Gleeson her name alone. She was the moving party. These facts alone are sufficient to rebut any presumption that her interest in the property was attributable to the relationship of husband and wife and his intention to benefit her. The Dalkeith property was never registered in Mr Bosanac's name. There was no transfer of the property from Mr Bosanac to Ms Bosanac. He did not advance all the monies for the purchase of the Dalkeith property. Ms and Mr Bosanac were both parties to the loan agreements and both were liable to repay the loans. This may be thought to raise a question as to whether they intended that the property be held jointly. This explains the Commissioner's claim for a one-half interest in the property. Some of the factors identified by the Full Court as relevant to the question of whether it was intended by Ms and Mr Bosanac that the property be owned jointly and that a one-half interest in the property be held on behalf of Mr Bosanac do not provide a strong foundation for any inference as to intention. In many of the decided cases the purchase monies were borrowed52, and little can in any event be drawn from this fact. It may be accepted that the Dalkeith property was to be the matrimonial home in which both spouses would reside and which they both would enjoy, but the Full Court did not suggest that that fact alone was sufficient for a conclusion as to intention. Moreover, this was not the first time that Ms and Mr Bosanac had shared a matrimonial home which was registered in the name of one only of them. At the time of the purchase of the Dalkeith property they resided in one of the units owned by Mr Bosanac. The remaining factor alluded to by the Full Court is that Mr Bosanac made a substantial borrowing without a corresponding benefit being received. The loans were used to pay the purchase price, including the deposit, and he used some of his property to secure the loans. There was a history of the use of the properties held by each of Ms and Mr Bosanac in their own names as security for joint loans. That is what occurred when the Dalkeith property was purchased. There was no evidence of the use of joint loans to acquire property which was then jointly held. Indeed, apart from some shared bank accounts there does not appear to have been any substantial property in which Ms and Mr Bosanac had a joint interest. 52 Stewart Dawson & Co (Vict) Pty Ltd v Federal Commissioner of Taxation (1933) 48 CLR 683; Martin v Martin (1959) 110 CLR 297 at 300; Calverley v Green (1984) 155 CLR 242 at 251. Gleeson In some cases, an inference may be drawn that spouses intended to hold real property jointly and for the rule as to survivorship to apply53. It will depend upon the evidence as to the parties' dealings. This is not such a case. There is nothing in the history of Ms and Mr Bosanac's dealings with property to suggest an intention that any substantial property was to be held jointly. The inference to be drawn in the present case is that, in being a party to the loan accounts and using his property as security for them, Mr Bosanac intended to facilitate his wife's purchase of the Dalkeith property, which was to be held in her name. This is consistent with the history of their dealings. There was further evidence before the primary judge of a subsequent dealing with the loan accounts over the Dalkeith property, or rather loan accounts which resulted from refinancing. The new loans continued to be secured by that property together with property owned individually. A portion of the loans was used by Mr Bosanac for his share trading. Ms Bosanac permitted this course. It may be assumed for present purposes that evidence of subsequent dealings of this kind is admissible54, as the primary judge held. The history of the spouses' dealings with property might suggest a use of property to secure joint loans which might benefit either or both of them, but it does not support an inference that either intended that property be held jointly. As the primary judge found, the "considerable evidence" was of separate ownership of property55. The finding by the primary judge that Mr Bosanac was a sophisticated businessman who must have appreciated the significance of property being held in Ms Bosanac's name is not unimportant. His Honour was correct to conclude that that understanding did not support an inference that Mr Bosanac intended to have a beneficial interest in the Dalkeith property. Orders Leave to amend the Notice of Contention should be refused. The appeal should be allowed. The orders of the Full Court of the Federal Court of Australia made on 31 August 2021 and 31 January 2022 should be set aside and, in their place, there be orders that the appeal be dismissed and the appellant below pay the 53 Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 301-302 54 See Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 300 55 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 131 [228]. Gleeson costs of the second respondent. The parties are agreed that there be no order for the costs incurred in this Court. In Hepworth v Hepworth56, Windeyer J made the point that "[a]n intention, proved or presumed, that a trust should exist is at the base of every trust". The intention to which his Honour referred is an objectively manifested intention that property be held in whole or in part for the benefit of another57. His Honour observed that "spouses, living together, may express their intention clearly enough one to another without resorting to the language of conveyancers" and that "[t]hus it sometimes happens that property which is held in the name of one spouse but which they enjoy together, belongs beneficially to both jointly or in common". The Commissioner of Taxation says that is what has happened in the present case. The appellant, Ms Bosanac, is the sole registered proprietor under the Transfer of Land Act 1893 (WA) of a residential property at Dalkeith. Ms Bosanac purchased the property using funds drawn from loan accounts in respect of which she was jointly and severally liable with her husband, Mr Bosanac. From the time of its purchase and for nearly a decade afterwards, Mr Bosanac and Ms Bosanac lived in the property as their matrimonial home. The Commissioner is a creditor of Mr Bosanac. In a proceeding commenced in the Federal Court of Australia against Mr Bosanac and Ms Bosanac, the Commissioner sought a declaration that Ms Bosanac holds half of the Dalkeith property on trust for Mr Bosanac. No issue seems to have been taken as to the standing of the Commissioner to seek that declaration58. Neither Mr Bosanac nor Ms Bosanac gave evidence in the proceeding. The Commissioner was unsuccessful at first instance59 but was successful on appeal to the Full Court60. Ms Bosanac now appeals, by special leave, from the decision of the Full Court. Like other members of this Court, I consider that the appeal must be allowed. (1963) 110 CLR 309 at 317. 57 See Byrnes v Kendle (2011) 243 CLR 253 at 275 [58]-[60], 286-290 [105]-[115]; Gissing v Gissing [1971] AC 886 at 906. 58 cf Sarkis v Deputy Commissioner of Taxation (2005) 59 ATR 33 at 41-42 [20]-[21]. 59 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74. 60 Commissioner of Taxation v Bosanac [2021] FCAFC 158; Commissioner of Taxation v Bosanac [No 2] [2022] FCAFC 5. The Commissioner's claim The Commissioner's claim that Ms Bosanac holds half of the Dalkeith property on trust was made in the shadow of s 34 of the Property Law Act 1969 (WA). Section 34(1), which derives from s 7 of the Statute of Frauds 1677 (Eng), provides that no "interest in land" can be created or disposed of except by writing signed by or on behalf of the person creating or conveying that interest and that a declaration of trust of an interest in land must be "manifested and proved by writing". Section 34(2), which derives from s 8 of the Statute of Frauds, provides that the section "does not affect the creation or operation of resulting, implied or constructive trusts". The Commissioner based his claim on the existence of a resulting trust presumed to have arisen from the circumstance that Mr Bosanac contributed equally with Ms Bosanac to her purchase of the Dalkeith property. The presumption on which the Commissioner based that claim is an ancient presumption of equity. The presumption arises where property was purchased by one or more persons using funds contributed in whole or in part by one or more others61. Unless there was consideration for the contribution, the presumption is that everyone concerned in the purchase transaction intended the property to be held at and from the time of purchase for the benefit of the contributors as tenants in common in proportion to their respective contributions. The presumed trust is sometimes referred to as a "purchase money resulting trust"62. The problem for the Commissioner was that the presumption of a purchase money resulting trust was met in the circumstance of Mr Bosanac having contributed to Ms Bosanac's purchase of the Dalkeith property by a similarly ancient counter-presumption of equity. The counter-presumption arises where a contributor and a purchaser were in a recognised category of relationship. The archetypal category is where the contributor was a husband and the purchaser was his wife. The counter-presumption is that the contributor and the purchaser intended the contribution to the purchase price to have been made and received as a gift, for the purchaser's "advancement". Where other indications of intention are equal, or at least equivocal, the counter-presumption is a complete answer to the presumption. The zero-sum result 61 See Heydon and Leeming, Jacobs' Law of Trusts in Australia, 8th ed (2016) at 212- 62 See Scott, Fratcher and Ascher, Scott and Ascher on Trusts, 5th ed (2009), vol 6, is "the absence of any reason for assuming that a trust arose or in other words that the equitable right is not at home with the legal title"63: no resulting trust. Duelling presumptions Needing to contend in Ms Bosanac's appeal with the stand-off between the presumption of a purchase money resulting trust and the counter-presumption of advancement, the Commissioner advances two innovative contentions. The principal contention is that the time has come for the counter-presumption of advancement to be abandoned as a doctrine of equity. The alternative contention is that the counter-presumption ought now to be trumped by an inference which ought to be recognised to arise where a husband and a wife each contribute to the purchase by one of them of a matrimonial home. The Commissioner contends that the husband and the wife ought to be presumed to intend each to have a one-half beneficial interest. In support of the principal contention, the Commissioner argues with some force that perpetuation of a presumption that a husband's contribution to the purchase of property by his wife is intended as a gift is not only anachronistic but is also discriminatory given that equity has in the past set its face against recognising corresponding presumptions that a wife's contribution to a purchase by her husband is intended as a gift64 and that a contribution by one de-facto partner to a purchase by another is intended as a gift65. The discrimination is exacerbated when comparison is made to a contribution by one same-sex marriage partner to a purchase by the other. Needing to rely on the presumption of a purchase money resulting trust, however, the Commissioner draws back from arguing that abandonment of the counter-presumption of advancement should be accompanied by abandonment or modification of the presumption of a resulting trust. Yet, as Hope JA pointed out in Dullow v Dullow66, the presumption of a resulting trust rather than the counter- presumption of advancement is the root anachronism, perpetuating expectations of a segment of society within late medieval England. 63 Martin v Martin (1959) 110 CLR 297 at 303. See also Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 298 [55]. 64 See Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 298 [55], citing Calverley v Green (1984) 155 CLR 242 at 268. 65 See Calverley v Green (1984) 155 CLR 242 at 260, 264. (1985) 3 NSWLR 531 at 535. See also Nelson v Nelson (1995) 184 CLR 538 at 602; Anderson v McPherson [No 2] (2012) 8 ASTLR 321 at 339 [114]. Were the doctrines of equity to be redesigned to accord with the societal expectations of contemporary Australia, the default position would be that a purchaser of property would be assumed to be its sole legal and beneficial owner. That would be so whether or not someone else might have contributed to the purchase price. For the purchaser to hold the whole or some part of the beneficial interest in the property on trust for a contributor to the purchase price would require proof of an actual intention to create a trust. There would be no presumption of a resulting trust and there would accordingly be no occasion for a counter- presumption of advancement. For better or for worse, the weight of history is too great for a redesign of that magnitude now to be undertaken judicially. This Court in Charles Marshall Pty Ltd v Grimsley67 adopted the description by Eyre CB in Dyer v Dyer68 of the presumption and counter-presumption as "landmarks" in the law and said then that the applicable law could "no longer be the subject of argument". That view was repeated by Deane J in Calverley v Green69 and by Deane and Gummow JJ in Nelson v Nelson70. Their Honours emphasised in the last of those cases that many disputes have been resolved and transactions effected based on the presumption and counter-presumption. They also explained that modern equivalents of ss 7 and 8 of the Statute of Frauds, of which s 34 of the Property Law Act is just one of many examples, assume their continuing operation. Evaluated by contemporary standards, the categories of relationships seen in the past to attract or not to attract the counter-presumption of advancement are inconsistent and discriminatory. That provides reason, consistent with equitable principle, to consider in an appropriate case expansion of those categories71. It provides no reason to bolster the anachronistic presumption of a resulting trust by abandoning the counter-presumption altogether. Unless and until they are together reappraised as an exercise in law reform and abolished or modified by legislation, the presumption of a resulting trust and the counter-presumption of advancement are here to stay. The Commissioner's contention that the counter-presumption of advancement should alone be abandoned as a doctrine of equity must be rejected. (1956) 95 CLR 353 at 364. (1788) 2 Cox Eq Cas 92 at 98 [30 ER 42 at 46]. (1984) 155 CLR 242 at 266. (1995) 184 CLR 538 at 547-549. 71 See Wirth v Wirth (1956) 98 CLR 228 at 238; Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 302 [69]. The Commissioner argues that his alternative contention – that the counter- presumption of advancement should give way to an inference of equality where a husband and a wife each contribute to the purchase by one of them of a matrimonial home – is supported by observations about common practices in spousal relationships in the then current edition of Professor Scott's treatise on the law of trusts72 quoted in Trustees of the Property of Cummins v Cummins73. The observations were not expressed in the treatise in the form of a presumption and were not said in Cummins to give rise to a presumption. The context for mentioning the observations in Cummins was that a husband and a wife had contributed unequally to the purchase of a matrimonial home of which they became registered proprietors as joint tenants. The observations were seen to be consistent with the drawing in the circumstances of that case of an inference of fact that the husband and the wife intended there to be no disconformity between their beneficial interests and their legal interests as joint tenants, with the result that there was "no occasion for equity to fasten upon the registered interest held by the joint tenants a trust obligation representing differently proportionate interests as tenants in common"74. The Commissioner's invitation to recognise a standardised inference arising where a husband and a wife each contribute to the purchase by one of them of a matrimonial home is in effect an invitation to create a counter-counter- presumption. The invitation must be declined. Stereotypes are best avoided. Old ones die hard. New ones should not be created judicially. Whatever might have been thought in the past, we must nowadays accept that families, even happy families, are not all alike. Instead of inventing another equitable presumption, conformation of the beneficial ownership of property acquired in a familial context to contemporary expectations is better pursued by paying close attention to the content and manner of operation of the existing presumptions. That is a topic to which remarkable acuity was brought in Australia in progressive and complementary reasons for judgment authored or co-authored by Cussen J75, Isaacs J76, Jordan CJ77, 72 Scott and Fratcher, The Law of Trusts, 4th ed (1989), vol 5, §443 at 197-198, §454 (2006) 227 CLR 278 at 302-303 [71]. (2006) 227 CLR 278 at 303 [72]. See also at 303 [73]. 75 Davies v The National Trustees Executors and Agency Co of Australasia Ltd [1912] VLR 397 at 401-402. 76 Scott v Pauly (1917) 24 CLR 274 at 282. In re Kerrigan; Ex parte Jones (1946) 47 SR (NSW) 76 at 81-83. Dixon CJ78, Gibbs CJ79 and Deane J80 over the course of the last century. The principles that emerge from their combined consideration of the topic can, I think, be summarised in the following terms. The presumption of a resulting trust is a presumption of fact, functionally akin to a civil onus of proof. The presumption will yield to an actual intention to the contrary found on the balance of probabilities as an inference drawn from the totality of the evidence. The weight to be given to the fact of a contribution having been made to the purchase price in drawing an inference as to actual intention will vary according to the totality of the circumstances of the case. The counter-presumption of advancement is not really a presumption at all. The existence of a relationship within a category recognised as triggering the counter-presumption is no more than a "circumstance of evidence"81. Considered alone, the circumstance of such a relationship is enough to negative the presumption which arises from the bare fact of contribution to the purchase price. However, the circumstance of such a relationship will not be considered alone if other evidence going to intention is adduced and will then simply be weighed in the overall evidentiary mix. Whether any, and if so what, inference is then to be drawn about the actual intention of the contributor and the purchaser falls to be determined as an ordinary question of fact on the balance of probabilities. "It is the intention of the parties in such cases that must control, and what that intention was may be proved by the same quantum or degree of evidence required to establish any other fact upon which a judicial tribunal is authorized to act."82 Just as the standard of proof of 78 Stewart Dawson & Co (Vict) Pty Ltd v Federal Commissioner of Taxation (1933) 48 CLR 683 at 689-691; Russell v Scott (1936) 55 CLR 440 at 451-453; Drever v Drever [1936] Argus LR 446 at 450; Wirth v Wirth (1956) 98 CLR 228 at 237; Martin v Martin (1959) 110 CLR 297 at 304-305. 79 Napier v Public Trustee (WA) (1980) 55 ALJR 1 at 2; 32 ALR 153 at 154-155; Calverley v Green (1984) 155 CLR 242 at 247-248. 80 Calverley v Green (1984) 155 CLR 242 at 265-267, 270-271; Muschinski v Dodds (1985) 160 CLR 583 at 612; Nelson v Nelson (1995) 184 CLR 538 at 547-549. 81 Dyer v Dyer (1788) 2 Cox Eq Cas 92 at 93-94 [30 ER 42 at 43]. Compare Glister, "Is There a Presumption of Advancement?" (2011) 33 Sydney Law Review 39. 82 Hartley v Hartley (1917) 117 NE 69 at 73, quoted in Scott and Fratcher, The Law of Trusts, 4th ed (1989), vol 5, §443 at 196 and Damberg v Damberg [2001] NSWCA 87 at [44]. See also Glister, "Section 199 of the Equality Act 2010: How Not to Abolish the Presumption of Advancement" (2010) 73 Modern Law Review 807 at intention is the ordinary civil standard, there are no special rules about proving intention. No predetermined weight is to be given either to the fact of a contribution having been made or to the categorisation of the relationship between the parties. The significance of each of those circumstances falls to be assessed within the totality of the circumstances of the case. Where evidence relevant to intention is adduced, the presumption and the counter-presumption are therefore of practical significance only in rare cases where the totality of the evidence is incapable of supporting the drawing of an inference, one way or the other, on the balance of probabilities about what contributors and purchasers actually intended when they participated in the purchase transaction. The present case The primary judge did not consider that the primary facts revealed by the evidence adduced in the proceeding supported an inference that Mr Bosanac intended to retain a beneficial interest in the Dalkeith property, with the consequence that "[t]he 'presumption' of advancement stands unrebutted"83. If the evidence were truly incapable of founding an inference on the balance of probabilities as to the actual intention of Mr Bosanac and Ms Bosanac when participating in the purchase of the Dalkeith property, that would indeed have been the consequence that followed. Taking a different view of whether an inference was available to be drawn from the primary facts, the Full Court concluded "that at the time of the purchase Mr Bosanac and Ms Bosanac intended that Mr Bosanac would have a 50% beneficial interest in the property that was to be their matrimonial home"84. I agree with the Full Court that the evidence supported the drawing of an inference on the balance of probabilities as to the actual intention of Mr Bosanac and Ms Bosanac when participating in the purchase of the Dalkeith property. However, I disagree as to the appropriate inference to be drawn. Going further than the primary judge, I consider that his findings of primary fact support the drawing of an inference on the balance of probabilities of an intention on the part of Mr Bosanac and Ms Bosanac that Ms Bosanac was alone 808-809. Compare Scott, Fratcher and Ascher, Scott and Ascher on Trusts, 5th ed (2009), vol 6, §43.4 and §43.12. 83 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 131 [230]. 84 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [27]. to be the legal and beneficial owner of the Dalkeith property. The primary facts supporting that inference are as follows. First, Mr Bosanac was a "sophisticated businessman" who "must be taken to have appreciated that the name in which real property is held is of significant consequence in almost all situations"85. Second, "it can safely be said this does not appear to be an instance of a husband and wife sharing all of the matrimonial assets jointly". To the contrary, although there were shared bank accounts, "Mr and Ms Bosanac appear to have kept their substantial assets in separate names"86. Mr Bosanac alone "held a substantial share portfolio"87. At the time of the purchase of the Dalkeith property, Mr Bosanac was the sole registered owner of two other properties, including one in which he and Ms Bosanac were then living88, and Ms Bosanac was the sole registered owner of another property89. Third, there was "considerable evidence" of "the use of separately owned properties as security for joint loans"90. The fact that the funds used for the purchase of the Dalkeith property were drawn from loan accounts for which Mr Bosanac and Ms Bosanac were jointly and severally liable and were secured by mortgages over the three other properties held separately by Mr Bosanac and Ms Bosanac fitted that pattern. That pattern of individual property ownership and joint borrowing leaves me unable to share the Full Court's view of it being "less probable than not ... that Mr Bosanac would take on a very substantial liability in respect of the Dalkeith Property without at the same time acquiring a corresponding beneficial interest in the Property"91. It also leaves me unable to agree with the Full Court's view that some significance should be attached to the fact that Mr Bosanac subsequently 85 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 131 [231]. 86 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 84 [57]. 87 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 129 [223]. 88 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 83 [43]. 89 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 130 [226]. 90 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 131 [228]. 91 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [21]. secured further borrowing against the Dalkeith property for the purposes of conducting his share trading92. Finally, and most importantly, there are the circumstances of the particular purchase transaction. To concentrate on the actions and inferred intention of Mr Bosanac, as did the Full Court, is to downplay the actions and inferred intention of Ms Bosanac. This is not a case in which it could be said that property was "purchased by" one person "in the name of" another93. Ms Bosanac was the sole contracting party for the purchase of the Dalkeith property: she made the offer which was accepted by the vendor94. To complete the purchase, Ms Bosanac chose to expose herself to liability for repayment of the loans which she and Mr Bosanac took out and to the risk of default on those loans95. There is no reason to think that she was put up to the purchase by Mr Bosanac or that she was required to become a party to the loan agreements in order for Mr Bosanac to obtain finance96. Disposition I agree with the orders proposed by Kiefel CJ and Gleeson J. 92 Commissioner of Taxation v Bosanac [2021] FCAFC 158 at [23]. 93 cf Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353 at 364-365; Wirth v Wirth (1956) 98 CLR 228 at 235. 94 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 82 [38]. 95 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 83 [41]-[42]. 96 Commissioner of Taxation v Bosanac [No 7] (2021) 390 ALR 74 at 129 [222]. GORDON AND EDELMAN JJ. The first respondent, the Commissioner of Taxation, sought a declaration that the appellant, Ms Bosanac, holds 50 per cent of her interest in a property owned by her in Philip Road, Dalkeith, Western Australia ("the Dalkeith property") on trust for her husband. Her husband, the second respondent, Mr Bosanac, is a debtor of the Commissioner. The Federal Court of Australia (McKerracher J) dismissed the Commissioner's application. The Full Court of the Federal Court (Kenny, Davies and Thawley JJ) allowed the Commissioner's appeal and granted him a declaration that Ms Bosanac holds 50 per cent of her interest in the Dalkeith property on trust for Mr Bosanac. Ms Bosanac was granted special leave to appeal. For the reasons that follow, the appeal should be allowed. These reasons will address the facts and the principles relating to the presumption of resulting trust and the so-called "presumption" of advancement. The reasons will then turn to explain that Ms and Mr Bosanac's conduct at the time of the acquisition of the Dalkeith property – the objective facts – establishes that their objective intention was inconsistent with a declaration of trust in favour of Mr Bosanac as to 50 per cent of Ms Bosanac's interest in the Dalkeith property. The presumption of resulting trust does not arise. No resulting trust was created. Facts The core facts were established by affidavit evidence filed by the Commissioner. Ms and Mr Bosanac were married in 1998. In May 2006, Ms Bosanac contracted to buy the Dalkeith property for $4.5 million, subject to her obtaining approval for a loan of $3 million from Westpac Banking Corporation. The deposit of $250,000 was paid from a pre-existing joint loan account Ms Bosanac held with Mr Bosanac. Subsequently, Ms and Mr Bosanac jointly applied for two new loans from Westpac totalling $4.5 million for the predominant purpose of purchasing the Dalkeith property. Ms and Mr Bosanac were each liable for the full amount of the loans; each was liable to repay $1 million plus interest in four months and to repay a further $3.5 million plus interest in one year. If neither Ms Bosanac nor Mr Bosanac made those repayments, Westpac could serve a notice on both of them which, if not complied with, would have entitled it to take possession of and sell not only the Dalkeith property, which was encumbered by a first registered mortgage in favour of Westpac, but also three other properties which were provided as security for the loans, at least one of which was held by Ms Bosanac in her own name. Ms and Mr Bosanac moved into the Dalkeith property as their matrimonial home in late 2006. Ms Bosanac was the sole registered proprietor of the Dalkeith property. There was no suggestion in this Court, or in the Courts below, that the Dalkeith property was registered in Ms Bosanac's name for the purpose of Mr Bosanac avoiding creditors. And there was no suggestion that Westpac required both Ms and Mr Bosanac to sign the loans to obtain the finance or, given that they did in fact both sign the loans, that Westpac sought to require the Dalkeith property to be registered in joint names97. The evidence disclosed that when Ms Bosanac purchased the Dalkeith property, there was a disparity in wealth and employment between Ms and Mr Bosanac. There was also considerable evidence of separate ownership of assets. Mr Bosanac, a "self-styled venture capitalist", was a wealthy and "sophisticated businessman". In the loan applications, he disclosed that he held substantial assets in his own name, including shares with a cash value in excess of $24 million and cash reserves. He disclosed no property assets. His gross annual income was listed as $388,401, and he disclosed liabilities of $120,000 in other instalment loans and a $15,130 line of credit. He did not disclose any liabilities related to real property. The Commissioner led evidence at trial as to Mr Bosanac's ownership of at least two properties, one of which was used as security for the loans. However, McKerracher J made no findings as to that evidence, instead holding that the evidence did not disclose the precise ownership of those properties. In the loan applications Ms Bosanac listed her occupation as "home duties". She had an annual gross income of $56,900, and held approximately $94,000 in cash at bank and at least two properties of which she was or would become the sole registered proprietor – the Dalkeith property and a property in Hardy Street, which were both provided as security for the loans. Prior to obtaining funding from Westpac to acquire the Dalkeith property, Ms Bosanac had listed total property assets of approximately $8.8 million with property related liabilities of about $5.5 million. She had no other loans or lines of credit. The initial Westpac funding was short term. In 2007, Westpac offered Ms and Mr Bosanac two further loans secured by the existing mortgages over the Dalkeith property and the Hardy Street property (both owned by Ms Bosanac) – a Rocket Investment Loan of $2 million and a Rocket Repay Home Loan of $1.6 million. Both loan offers listed the predominant purpose as "Refinance of Existing Home Loan". An inference available to be drawn from the facts at the time Ms Bosanac acquired the Dalkeith property is that Mr Bosanac facilitated Ms Bosanac's acquisition of that property by assisting in paying the deposit and entering into the 97 cf Calverley v Green (1984) 155 CLR 242 at 251. joint loans for the purpose of funding the purchase. A further inference available to be drawn from the facts at the time Ms Bosanac acquired the Dalkeith property is that Mr Bosanac intended that Ms Bosanac's rights in the Dalkeith property would be used later to benefit him, which they were. The Rocket Investment Loan was used by Mr Bosanac to conduct share trading. In 2012 or 2013, Ms and Mr Bosanac separated, but they continued living together at the Dalkeith property until about mid-2015 and did not divorce at that time. Mr Bosanac did not give evidence at trial. Resulting trusts Delivering the judgment of the Supreme Court of Canada in Kerr v Baranow98, Cromwell J observed that "there is not much one can say about resulting trusts without a well-grounded fear of contradiction. There is debate about how they should be classified and how they arise, let alone about many of the finer points". One source of difficulty is the description of the trust as "resulting". As Birks observed, "[i]f the traditional classification of trusts simply contradistinguished express and constructive trusts, there would be no further complications"99. Like a constructive trust, which arises by operation of law100, a resulting trust sometimes describes a trust in favour of a transferor that is imposed independently of the manifested intention of the transferor to create a trust. But, like an express trust, which arises due to objective or manifested intention to create a trust101, a resulting trust sometimes describes a trust that was objectively intended by the transferor of property. These disparate categories are treated alike as "resulting" trusts merely by the pattern of their effect. From the Latin, resalire or [2011] 1 SCR 269 at 286 [16]. See also Anderson v McPherson [No 2] (2012) 8 ASTLR 321 at 335-337 [89]-[103]. 99 Birks, Unjust Enrichment, 2nd ed (2005) at 304. 100 Muschinski v Dodds (1985) 160 CLR 583 at 613-614, 617; Baumgartner v Baumgartner (1987) 164 CLR 137 at 147-148. See also Jacobs' Law of Trusts in Australia, 8th ed (2016) at 228 [13-01]. 101 Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (In liq) (2000) 202 CLR 588 at 605 [34], citing Walker v Corboy (1990) 19 NSWLR 382; Byrnes v Kendle (2011) 243 CLR 253 at 286-290 [102]-[114]. resultare, the equitable interest is said to "jump back" to the settlor or those taking through the settlor102. Examples of resulting trusts that have been held to arise by operation of law, irrespective of any objective intention to create a trust, are trusts that arise upon the failure of an express trust103 or by a transfer of a person's legal rights without their consent or knowledge104. Examples of resulting trusts that arise from objective intention to create a trust are trusts that arise in favour of a transferor of property ("voluntary conveyance resulting trust") or a contributor of purchase money ("purchase money resulting trust")105. This appeal concerns only this latter category of resulting trust, namely those trusts that arise by objective intention. Presumption of resulting trust The "presumption of resulting trust" is a presumption that a resulting trust arises in the two circumstances where resulting trusts arise by objective intention. The presumption has been described as anachronistic106. As explained below, that description is correct. But although the anachronistic nature of the 102 Chambers, Resulting Trusts (1997) at 4, referring to Birks, An Introduction to the Law of Restitution, rev ed (1989) at 60; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 72. cf Jacobs' Law of Trusts in Australia, 8th ed (2016) at 205-206 [12-01]; Anderson (2012) 8 ASTLR 321 at 335-336 [90]-[91], citing DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 at 463, Federal Commissioner of Taxation v Linter Textiles Australia Ltd (In liq) (2005) 220 CLR 592 at 606 [30] and Peldan v Anderson (2006) 227 CLR 471 at 485 [37]. 103 See, eg, In re Gillingham Bus Disaster Fund [1958] Ch 300 at 310; Vandervell v Inland Revenue Commissioners [1967] 2 AC 291 at 312-314; In re Vandervell's Trusts [No 2] [1974] Ch 269 at 288-293; DKLR (1982) 149 CLR 431 at 459-460; Air Jamaica Ltd v Charlton [1999] 1 WLR 1399 at 1412. 104 El Ajou v Dollar Land Holdings Plc [1993] 3 All ER 717 at 734; Evans v European Bank Ltd (2004) 61 NSWLR 75 at 99-100 [111]-[114]. See also Chambers, Resulting Trusts (1997) at 118, discussing Black v S Freedman & Co (1910) 12 CLR 105 See Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 106 Dullow v Dullow (1985) 3 NSWLR 531 at 535; Anderson (2012) 8 ASTLR 321 at 339 [115]. See also Pettitt v Pettitt [1970] AC 777 at 824; Calverley (1984) 155 CLR 242 at 264-265, 266; Brown v Brown (1993) 31 NSWLR 582 at 595; Nelson v Nelson (1995) 184 CLR 538 at 602. presumption of resulting trust may inform its weight, the presumption is "too well entrenched as [a] 'land-mark[]' in the law of property to be simply discarded by judicial decision"107. Where it has been recognised to exist, transactions have been undertaken, and disputes resolved, on the basis of the presumption. And Parliament has recognised the resulting trust, with an appreciation of the circumstances of the presumption, as an exception to statutory formality requirements108, relevantly in this case by s 34(2) of the Property Law Act 1969 (WA). For present purposes, it is enough to recognise that the so-called presumption of resulting trust developed in feudal times as a way to circumvent forfeiture (because land could only be left to heirs and not by will and if there was no heir it was forfeited ("escheated") to the feudal lord109) and to deal with the vicissitudes of war110. Between the 15th and 17th centuries a practice developed whereby owners of land conveyed ("feoffed") their land gratuitously to others to the "use" of themselves; these were called "feoffments to the use of the feoffor" – or a "declaration of use"111. In these conveyances it was not usual to include words of trust or "use" on the face of the conveyance; but the practice was so common that courts of equity began to apply a "presumption" of declaration of use112 or, as we now refer to it, a "presumption of resulting trust". As Deane J explained in Calverley v Green113, the presumption of resulting trust "evolved in times when a majority of adults laboured under restrictions and disabilities in respect of the ownership and protection of property and when it may 107 Calverley (1984) 155 CLR 242 at 266 (citation omitted), quoting Dyer v Dyer (1788) 2 Cox Eq Cas 92 at 94 [30 ER 42 at 43]. See also Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353 at 364; Nelson (1995) 184 CLR 538 at 548, 584, 602. 108 See Property Law Act 1969 (WA), s 34(1). 109 Nettle, "Trust and Commerce in Historical Perspective" (2021) 15 Journal of Equity 110 Lloyd v Spillet (1740) 2 Atk 148 at 150 [26 ER 493 at 494]; Dullow (1985) 3 NSWLR 531 at 535; Anderson (2012) 8 ASTLR 321 at 338 [110]; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 79-80. 111 Chambers, Resulting Trusts (1997) at 16-17, 19-20; Dyer (1788) 2 Cox Eq Cas 92 at 93 [30 ER 42 at 43]; Anderson (2012) 8 ASTLR 321 at 338 [109]. 112 Dullow (1985) 3 NSWLR 531 at 535; Anderson (2012) 8 ASTLR 321 at 338 [113]; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 79-80; Ong, Trusts Law in Australia, 5th ed (2018) at 455. 113 (1984) 155 CLR 242 at 265-266. have been wrong to assume that the fact that property was caused to be transferred into the legal ownership of a person without any express qualifying limitation was a prima facie indication of an intention that [they] should own it". But as his Honour acknowledged114, "[e]ven in those times however, there was much to be said for the view that, except where [it] served the same function as a civil onus of proof and operated to resolve a factual contest in circumstances where the relevant evidence was either uninformative or truly equivocal, the worth of [the] presumption[] was at best debatable". That statement applies with greater force today115. In modern times, the presumption has been applied to personalty116 as well as realty. Acknowledging that it is too late to abolish it117, the presumption of resulting trust should be recognised as a weak presumption given that the circumstances justifying it have changed so much since the foundations of the presumption in the 15th century118. Presumption of fact or law? There are arguably what are loosely described as two types of presumptions – a presumption of fact or an evidentiary presumption, and a presumption of law119. A presumption of fact is no more than a traditional inference based on logic and common sense which a tribunal of fact ordinarily 114 Calverley (1984) 155 CLR 242 at 266. See also 264-265. 115 Dullow (1985) 3 NSWLR 531 at 535; Brown (1993) 31 NSWLR 582 at 595; Nelson (1995) 184 CLR 538 at 602; Anderson (2012) 8 ASTLR 321 at 339 [114]. 116 See Jacobs' Law of Trusts in Australia, 8th ed (2016) at 212 [12-10], citing The Venture [1908] P 218 and Bateman Television Ltd v Bateman [1971] NZLR 453. 117 Calverley (1984) 155 CLR 242 at 266, quoting Dyer (1788) 2 Cox Eq Cas 92 at 94 [30 ER 42 at 43]. See also Charles Marshall (1956) 95 CLR 353 at 364; Nelson (1995) 184 CLR 538 at 548, 584, 602. 118 See Calverley (1984) 155 CLR 242 at 265-266. 119 Masson v Parsons (2019) 266 CLR 554 at 575-576 [32]; Federal Commissioner of Taxation v Carter (2022) 96 ALJR 325 at 332 [29], 335 [42]; 399 ALR 521 at 528, 532; cf Thayer, A Preliminary Treatise on Evidence at the Common Law (1898) at 339; Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), vol 4 at 3533 §2491; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 76; Cross on Evidence, 13th Aust ed (2021) at 383 draws from basic facts120. Absent evidence either way, "a particular state of affairs is accepted as fact because it is ordinary and universal experience that, save perhaps in extraordinary situations, it is always so"121. Put differently, absent another explanation, a presumption of fact arises from facts which, from common experience, so obviously suggest a particular state of affairs that they give rise to an inference to that effect, or an assumption that the only explanation is that suggested by the objective facts122. It arises and may operate in the absence of evidence to the contrary. However, a presumption of fact falls short of being a presumption in the proper legal sense123: it may permit an inference to be drawn upon proof of the basic fact; it does not necessarily attach any legal consequence124. On the other hand, a presumption of law is a rule of law which, in the absence of other, contrary evidence, attaches a legal consequence to one evidentiary fact125. Unlike a presumption of fact, in the absence of other evidence a presumption of law requires that the inference be drawn126. The use of the term "presumption" to describe both presumptions of fact and presumptions of law has been criticised127. Regardless of the validity of the 120 Masson (2019) 266 CLR 554 at 575-576 [32]. 121 R v Falconer (1990) 171 CLR 30 at 83. See also Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd (1982) 150 CLR 169 at 213; Calverley (1984) 155 CLR 242 at 264; Weissensteiner v The Queen (1993) 178 CLR 217 at 242-243; Thorne v Kennedy (2017) 263 CLR 85 at 101 [34]; Carter (2022) 96 ALJR 325 at 335 [43]; 399 ALR 521 at 532. 122 Weissensteiner (1993) 178 CLR 217 at 243. 123 Thayer, A Preliminary Treatise on Evidence at the Common Law (1898) at 339; Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), vol 4 at 3533 §2491; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 76. 124 See Cross on Evidence, 13th Aust ed (2021) at 383 [7255], 384 [7260]. 125 Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), vol 4 at 3534 §2491. 126 Cross on Evidence, 13th Aust ed (2021) at 384 [7260], 384-385 [7265]-[7270]. 127 Thayer, A Preliminary Treatise on Evidence at the Common Law (1898) at 339; Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), distinction and the criticisms, no additional probative force should be attributed to the contrary128. there a so-called presumption when Wigmore explained it in these terms129: is evidence "[T]he peculiar effect of a presumption 'of law' (that is, the real presumption) is merely to invoke a rule of law compelling the jury to reach the conclusion in the absence of evidence to the contrary from the opponent. If the opponent does offer evidence to the contrary (sufficient to satisfy the judge's requirement of some evidence), the presumption disappears as a rule of law, and the case is in the jury's hands free from any rule ... It is therefore a fallacy to attribute (as do some judges) an artificial probative force to a presumption, increasing for the jury the weight of the facts, even when the opponent has come forward with some evidence to the contrary. For example, if death be the issue, and the fact of absence for seven years unheard from be conceded, but the opponent offers evidence that the absentee, before leaving, proclaimed his intention of staying away for ten years, until a prosecution for crime was barred, this satisfies the opponent's duty of producing evidence, removing the rule of law; and when the case goes to the jury, they are at liberty to give any probative force they think fit to the fact of absence for seven years unheard from. It is not weighed down with any artificial additional probative effect; they may estimate it for just such intrinsic effect as it seems to have under all the circumstances." That is, once evidence is adduced to address the issue in dispute, the presumption has no "superadded weight"130. Once that evidence is led, "even weak evidence ... must prevail if there is not other evidence to counterbalance it"; the presumption only arises where the evidence is evenly balanced and the court is unable to make a decision131. As Deane J explained in vol 4 at 3533 §2491; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 76; Cross on Evidence, 13th Aust ed (2021) at 383 128 Thayer, A Preliminary Treatise on Evidence at the Common Law (1898) at 339; Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), vol 4 at 3533 §2491; Cross on Evidence, 13th Aust ed (2021) at 386-387 [7280]. 129 Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), vol 4 at 3534-3535 §2491 (emphasis in original, footnotes omitted). 130 Cross on Evidence, 13th Aust ed (2021) at 386 [7280]. 131 S v S [1972] AC 24 at 41 (emphasis added), quoted in Cross on Evidence, 13th Aust ed (2021) at 386-387 [7280]. See Pettitt [1970] AC 777 at 814. Calverley132 in relation to the presumption of resulting trust, the presumption "serve[s] the same function as a civil onus of proof [by] operat[ing] to resolve a factual contest in circumstances where the relevant evidence [is] either uninformative or truly equivocal". Or, as Lord Upjohn said in Vandervell v Inland Revenue Commissioners133, "the so-called presumption of a resulting trust is no more than a long stop to provide the answer when the relevant facts and circumstances fail to yield a solution". Whether it is classified as a presumption of fact134 or a presumption of law135, and although described as "entrenched"136, given the now weak nature of the presumption of resulting trust, the objective facts determine its position and significance (if any). Presumption of resulting trust – what is presumed and when and how does the presumption arise? Two immediate questions arise – when and how does a presumption of resulting trust arise and what is presumed? Relevantly in the case of "voluntary conveyance resulting trusts" and "purchase money resulting trusts", what is presumed is a declaration of trust by the person who either transfers property, or pays the whole or part of the purchase price of it137. But whether that is presumed – whether that inference is drawn – depends on issues of evidence and proof of a resulting trust. And in answering those questions, it is necessary to address the matters raised by Deane J in Calverley. 132 (1984) 155 CLR 242 at 266. 133 [1967] 2 AC 291 at 313. 134 See Pettitt [1970] AC 777 at 823; Chambers, Resulting Trusts (1997) at 11; cf Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 135 Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 136 Calverley (1984) 155 CLR 242 at 266, citing Dyer (1788) 2 Cox Eq Cas 92 at 94 [30 ER 42 at 43]. See also Charles Marshall (1956) 95 CLR 353 at 364; Nelson (1995) 184 CLR 538 at 548, 584, 602. 137 Anderson (2012) 8 ASTLR 321 at 337-338 [106]; Swadling, "Explaining Resulting Trusts" (2008) 124 Law Quarterly Review 72 at 79-80, 85-94; cf Chambers, Resulting Trusts (1997) at 20-27. to resolve a factual contest when The presumption of resulting trust – the standardised inference that allocates the onus of proof – serves the same function as a civil onus of proof and operates "uninformative or truly equivocal"138. It arises if there be a paucity of evidence as to an intention to declare a trust139. Put in different terms, where the presumption arises, the existence of a resulting trust is an inference drawn in the absence of evidence when, for example, a purchaser of property causes it to be transferred to another or when a person contributes to the purchase of property which is registered in the name of another140. But such an inference – of resulting trust – cannot arise where a plaintiff has led evidence that tends to establish an objective intention or the lack of an objective intention to create a trust141. the relevant evidence As a resulting trust is an inference drawn in the absence of evidence, it is necessary to start with the objective facts. It is a factual inquiry. The question may be framed in these terms: what were the parties' words or conduct at the time of the transaction or so immediately thereafter as to constitute part of the transaction – the objective facts142? There are three dimensions to that factual inquiry. Where the objective facts based on evidence led by the plaintiff tend to establish an objective intention that a provider of part of the purchase price would hold an equitable interest as to a particular proportion of a particular property, there will be an express trust which satisfies the three certainties of intention, subject and object143. That is the case that the defendant has to meet. There is no need for a presumption of resulting trust to shift the onus of proof. The presumption of resulting trust does not arise. It is unnecessary. 138 Calverley (1984) 155 CLR 242 at 266. 139 Nelson (1995) 184 CLR 538 at 547. 140 Pettitt [1970] AC 777 at 823; Calverley (1984) 155 CLR 242 at 264. 141 Muschinski (1985) 160 CLR 583 at 612. See also Vandervell [1967] 2 AC 291 at 313; Pettitt [1970] AC 777 at 815. 142 Calverley (1984) 155 CLR 242 at 262. See also Charles Marshall (1956) 95 CLR 353 at 365, quoting Shephard v Cartwright [1955] AC 431 at 445, in turn quoting Snell's Equity, 24th ed (1954) at 153. 143 Kauter v Hilton (1953) 90 CLR 86 at 97; Associated Alloys (2000) 202 CLR 588 at 604 [29]; Korda v Australian Executor Trustees (SA) Ltd (2015) 255 CLR 62 at 71 On the other hand, where the objective facts based on evidence led by the plaintiff tend to establish, even weakly144, an objective intention inconsistent with a declaration of trust, then there will be no case for the defendant to meet. Again, the presumption of resulting trust will not arise145. In this circumstance, the fact that there is a spousal relationship is one of the objective facts: at best it merely reinforces, and is not determinative of, the objective intention of the parties established by the objective facts. Where, however, the objective facts based on evidence led by the plaintiff are neutral, truly equivocal, non-existent or uninformative as to the objective intention of the parties, then, consistent with the weak presumption of resulting trust, an inference can be drawn of a declaration of trust by the provider of part of the purchase price146. That weak inference will be the case that the defendant has to meet. As Lord Diplock said in Pettitt v Pettitt147, the presumption is an example of the courts' technique of: "imputing an intention to a person wherever the intention with which an act is done affects its legal consequences and the evidence does not disclose what was the actual intention with which [they] did it. ... [The presumption is] not immutable. A presumption of fact is no more than a consensus of judicial opinion disclosed by reported cases as to the most likely inference of fact to be drawn in the absence of any evidence to the contrary". With the qualification that these references to "actual intention" must be understood as the objective manifestation of intention, the presumption of resulting trust "cannot prevail over the actual intention of that party as established by the 144 S v S [1972] AC 24 at 41, quoted in Cross on Evidence, 13th Aust ed (2021) at 386-387 [7280]. See Pettitt [1970] AC 777 at 814. 145 Pettitt [1970] AC 777 at 815, 823; Muschinski (1985) 160 CLR 583 at 612; Goodman v Gallant [1986] Fam 106 at 110-111. 146 Pettitt [1970] AC 777 at 815, 823; S v S [1972] AC 24 at 41, quoted in Cross on Evidence, 13th Aust ed (2021) at 387 [7280]; Calverley (1984) 155 CLR 242 at 266; Muschinski (1985) 160 CLR 583 at 612; Goodman [1986] Fam 106 at 110-111; Nelson (1995) 184 CLR 538 at 547. 147 [1970] AC 777 at 823 (emphasis added). See also Calverley (1984) 155 CLR 242 at overall evidence"148; it will "operate to place the burden of proof, if there be a paucity of evidence bearing upon such a relevant matter as the intention of the party who provided the funds for the purchase"149. As has been explained, the first step is the objective factual inquiry of ascertaining the parties' words or conduct at the time of the transaction or so immediately thereafter as to constitute part of the transaction. If there is a spousal relationship, that relationship is a circumstance of fact in which the presumption of resulting trust does not arise – that circumstance of fact is sometimes referred to as the "presumption of advancement"150. It will be necessary to address this so-called presumption below. There is also an important temporal dimension to the factual inquiry. The objective intention of the parties is determined at the time when the trust was purportedly created151 – here, when the property in issue was purchased. Apart from admissions against interest, the only evidence relevant and admissible as to the parties' objective intention is their acts and declarations before or at the time of the transaction or "so immediately [thereafter] as to constitute a part of the transaction"152. Subsequent events and conduct are otherwise not admissible153. "Presumption" of advancement As the result in this appeal does not depend on the "presumption" of advancement, the Commissioner should be refused leave to amend his notice of contention to contend that the "presumption" of advancement should be abolished. The following matters, however, should be stated. 148 Muschinski (1985) 160 CLR 583 at 612 (emphasis added). See also Vandervell [1967] 2 AC 291 at 313; Pettitt [1970] AC 777 at 815. 149 Nelson (1995) 184 CLR 538 at 547 (emphasis added). 150 Wirth v Wirth (1956) 98 CLR 228 at 237; Martin v Martin (1959) 110 CLR 297 at 303; Pettitt [1970] AC 777 at 814; Calverley (1984) 155 CLR 242 at 247, 256, 265, 267; Nelson (1995) 184 CLR 538 at 548-549, 586, 601. 151 Calverley (1984) 155 CLR 242 at 252, 262. 152 Charles Marshall (1956) 95 CLR 353 at 365, quoting Shephard [1955] AC 431 at 445, in turn quoting Snell's Equity, 24th ed (1954) at 153; Calverley (1984) 155 CLR 153 cf Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 at 300 [65]. First, the "presumption" of advancement is not a "presumption" at all, but is, instead, one circumstance of fact in which the presumption of resulting trust does not arise154. In modern relationships, the fact is that in a relationship of close trust there may be no occasion to presume a resulting trust in favour of the person who provided part or all of the purchase price of a property, or gratuitously transferred a property, registered in the name of the other person. In such circumstances, no equitable interest is created and engrafted onto the legal interest155. Second, although the "presumption" of advancement has been described as entrenched156, its rationale has not been consistently explained157 and, no less importantly, it has long been recognised that the limited classes of relationships of close trust from which the "presumption" arises "may not accord with contemporaneous practices and modes of thought"158. Given the significance of a relationship of close trust in finding the objective facts, there may well be scope in the future to extend the "presumption" of advancement to a broader range of relationships, as was at least started in Nelson v Nelson159, where the lack of any presumption of resulting trust in circumstances involving a transfer from a father to a child was extended to circumstances involving a transfer from a mother to a child. But the issue of any extension of the "presumption" of advancement does not arise on this appeal. 154 Wirth (1956) 98 CLR 228 at 237; Martin (1959) 110 CLR 297 at 303; Pettitt [1970] AC 777 at 814; Calverley (1984) 155 CLR 242 at 247, 256, 265, 267. 155 See DKLR (1982) 149 CLR 431 at 463; Linter Textiles (2005) 220 CLR 592 at 606 [30]; Peldan (2006) 227 CLR 471 at 485 [37]; Boensch v Pascoe (2019) 268 CLR 593 at 599 [4]; Carter (2022) 96 ALJR 325 at 334 [41]; 399 ALR 521 at 531-532, quoting Commissioner of State Revenue (WA) v Rojoda Pty Ltd (2020) 268 CLR 281 at 307 [44], in turn citing Chief Commissioner of Stamp Duties (NSW) v Buckle (1998) 192 CLR 226 at 243 [38]. 156 Calverley (1984) 155 CLR 242 at 266, quoting Dyer (1788) 2 Cox Eq Cas 92 at 94 [30 ER 42 at 43]. See also Charles Marshall (1956) 95 CLR 353 at 364; Nelson (1995) 184 CLR 538 at 548, 584, 602. 157 Calverley (1984) 155 CLR 242 at 248. See also Wirth (1956) 98 CLR 228 at 237; Nelson (1995) 184 CLR 538 at 575-576, 586. 158 Nelson (1995) 184 CLR 538 at 602. See also Calverley (1984) 155 CLR 242 at 159 (1995) 184 CLR 538 at 548-549, 574-575, 585-586, 601. Cummins not relevant The Full Court held that the nature of the transaction in issue in this appeal – described incorrectly as Mr Bosanac "borrowing to acquire and gift a house" to Ms Bosanac – permitted "an inference as to intention consistent with the inference drawn in [Trustees of the Property of Cummins v] Cummins[160] at [71], in the second passage quoted from Professor Scott's work". It is necessary to set out the passage from Cummins. It read161: "The present case concerns the traditional matrimonial relationship. Here, the present edition of the Professor Scott's work respecting beneficial ownership of the matrimonial home should be accepted162: following view expressed 'It is often a purely accidental circumstance whether money of the husband or of the wife is actually used to pay the purchase price to the vendor, where both are contributing by money or labor to the various expenses of the household. It is often a matter of chance whether the family expenses are incurred and discharged or services are rendered in the maintenance of the home before or after the purchase.' To that may be added the statement in the same work163: 'Where a husband and wife purchase a matrimonial home, each contributing to the purchase price and title is taken in the name of one of them, it may be inferred that it was intended that each of the spouses should have a one-half interest in the property, regardless of the amounts contributed by them.'" Although the Full Court rejected the Commissioner's submission that these passages qualified the "presumption" of advancement in the context of the matrimonial home, it nevertheless drew the inference referred to in the second statement extracted above. In this Court, the Commissioner sought to reagitate, by notice of contention, the submission rejected by the Full Court. With respect, reliance on those passages was an error. First, the starting point is the objective facts, not the so-called "inference drawn in Cummins". Second, and relatedly, 160 (2006) 227 CLR 278. 161 Cummins (2006) 227 CLR 278 at 302-303 [71]. 162 Scott, The Law of Trusts, 4th ed (1989), vol 5 at 239 §454. 163 Scott, The Law of Trusts, 4th ed (1989), vol 5 at 197-198 §443 (footnote omitted). Mr Bosanac's borrowing did not, itself, establish that he held an objective intention to declare a trust in his favour in relation to part of the Dalkeith property. As has been seen, Mr Bosanac's borrowing was one – or really part of one – objective fact which was required to be considered in determining the objective intention of the parties at the time of the purchase of the Dalkeith property or so immediately thereafter as to constitute part of the transaction. It was not, and could not be, determinative. Third, the passages in Cummins were obiter; the objective facts in that case established that the intention of both parties was that they would hold the property Finally, and of primary significance, the two cases cited by Professor Scott in support of his second statement quoted in Cummins concerned a statutory discretion under s 17 of the Married Women's Property Act 1882 (45 & 46 Vict c 75), which provided that in any question between husband and wife as to the title or possession of property, the court was to decide the matter as it thought fit165. In short, under that Act, "the question of contract, gift, or trust" was put to one side166. The second quoted statement from Professor Scott does not concern equity more generally or any equitable presumption. Objective intention inconsistent with declaration of trust The objective facts arising from the Commissioner's affidavit evidence – the parties' conduct at the time of the purchase of the Dalkeith property – do not permit an inference consistent with a declaration of trust. To the contrary, the inference to be drawn from the objective facts is that the parties' objective intention was inconsistent with a declaration of trust in favour of Mr Bosanac as to 50 per cent of Ms Bosanac's interest in the Dalkeith property. Accordingly, the presumption of resulting trust does not arise167. No equitable interest in favour of Mr Bosanac was created. 164 Cummins (2006) 227 CLR 278 at 303 [73]. 165 Rimmer v Rimmer [1953] 1 QB 63 at 70-71, 73, 76; Fribance v Fribance [No 2] [1957] 1 WLR 384 at 387; [1957] 1 All ER 357 at 359. See also Cobb v Cobb [1955] 1 WLR 731; [1955] 2 All ER 696; Silver v Silver [1958] 1 WLR 259 at 262-263; [1958] 1 All ER 523 at 525-526. 166 Fribance [1957] 1 WLR 384 at 387; [1957] 1 All ER 357 at 359. 167 Pettitt [1970] AC 777 at 815, 823; Calverley (1984) 155 CLR 242 at 267; Muschinski (1985) 160 CLR 583 at 612; Goodman [1986] Fam 106 at 110-111. Ms and Mr Bosanac made the financial arrangements they did for the acquisition of the Dalkeith property recognising, intending and understanding that the Dalkeith property was Ms Bosanac's – not only was it acquired in her name and registered in her name, but it was her property. Recognition, intention and understanding are different words for expressing the inference that is to be drawn from all of the parties' conduct at the time the Dalkeith property was acquired – the objective facts – including the way in which they had arranged their overall financial affairs in the past. In particular, Ms and Mr Bosanac held their substantial assets separately. Ms Bosanac contracted to purchase the Dalkeith property alone and the purchase contract required Ms Bosanac to acquire finance. Although there was no evidence that Westpac required the loans to be put in both names168, the disparity in wealth and employment makes it unlikely that Ms Bosanac could have obtained or serviced the loans on her own. In that circumstance, and against the history of Ms and Mr Bosanac holding their substantial assets separately, the clear inference is that the parties' objective intention was that Mr Bosanac was doing no more than facilitating Ms Bosanac's acquisition of the Dalkeith property by assisting in paying the deposit and entering into the joint loans for the purpose of funding the purchase. In addition, the Dalkeith property was transferred into Ms Bosanac's name and she was and remained its sole registered proprietor. There was nothing in the evidence to indicate that Ms and Mr Bosanac could not have jointly purchased the Dalkeith property, signed the contract together, and registered it in their joint names. There was no suggestion that Ms Bosanac contracted to purchase and did purchase the Dalkeith property in her name to assist her husband to avoid creditors. Finally, the fact that Ms and Mr Bosanac were married at the time of the purchase of the Dalkeith property is not determinative: at best that fact merely reinforces the inference available from the other facts – that the parties' objective or manifested intention was for Mr Bosanac to facilitate the acquisition by Ms Bosanac of the Dalkeith property. The presumption of resulting trust does not arise. It has no role to play. As has been observed, the Full Court reached the opposite conclusion. In short, it asked itself the wrong question. It did not start with the facts and ask – what were the parties' words or conduct at the time of the transaction or so 168 cf Calverley (1984) 155 CLR 242 at 251. immediately thereafter as to constitute part of the transaction169? It did not ask what those facts established as to the objective intention, if any, of the parties in relation to the acquisition of the Dalkeith property. Instead, the Full Court relied in particular on three facts it considered were conclusive of Mr Bosanac's intention that the Dalkeith property not be a "gift" to Ms Bosanac: that Ms and Mr Bosanac manifested an intention that the Dalkeith property be their matrimonial home; that the manifest purpose of the joint loans was to purchase the Dalkeith property; and that security for the loans was over four properties, including the Dalkeith property. With respect, those matters were not the entirety of the facts and, whether considered as part of the entirety of the facts or even alone, they were inconsistent with an objective intention to declare a trust in favour of Mr Bosanac as to 50 per cent of Ms Bosanac's interest in the Dalkeith property. Moreover, contrary to the view expressed by the Full Court, there is no qualitative difference between transferring a house and borrowing part of the purchase price. The nature of the borrowing does not permit an inference either way. Conclusion and orders For those reasons, the appeal should be allowed. We agree with the orders proposed by Kiefel CJ and Gleeson J. 169 Calverley (1984) 155 CLR 242 at 262. See also Charles Marshall (1956) 95 CLR 353 at 365, quoting Shephard [1955] AC 431 at 445, in turn quoting Snell's Equity, 24th ed (1954) at 153.
HIGH COURT OF AUSTRALIA Matter No M98/2016 TIMBERCORP FINANCE PTY LTD (IN LIQUIDATION) APPELLANT AND DOUGLAS JAMES COLLINS & ANOR RESPONDENTS Matter No M101/2016 TIMBERCORP FINANCE PTY LTD (IN LIQUIDATION) APPELLANT AND RESPONDENT Timbercorp Finance Pty Ltd (in liquidation) v Collins Timbercorp Finance Pty Ltd (in liquidation) v Tomes [2016] HCA 44 9 November 2016 M98/2016 & M101/2016 ORDER Matter No M98/2016 Appeal dismissed with costs. Matter No M101/2016 Appeal dismissed with costs. On appeal from the Supreme Court of Victoria Representation P H Solomon QC with C O H Parkinson and C J Tran for the appellant in both matters (instructed by Mills Oakley) M D Wyles QC with D J Fahey for the respondents in M98/2016 (instructed by M+K Lawyers Group Pty Ltd) B W Walker SC with M K Condon SC and L H Kirwan for the respondent in M101/2016 (instructed by Somerset Ryckmans Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Timbercorp Finance Pty Ltd (in liquidation) v Collins Timbercorp Finance Pty Ltd (in liquidation) v Tomes Estoppel – Anshun estoppel – Where appellant provided loans to investors to fund investments in managed investment schemes – Where appellant placed in liquidation – Where group proceeding against appellant under Pt 4A of Supreme Court Act 1986 (Vic) by lead plaintiff on behalf of himself and group members alleging misrepresentations and failure to disclose information about risks – Where respondents group members in group proceeding – Where group proceeding unsuccessful – Where subsequent proceedings by appellant against respondents seeking recovery of outstanding principal and interest – Where respondents pleaded number of defences in recovery proceedings – Whether lead plaintiff in group proceeding respondents' privy – Whether defences precluded by reason of estoppel which arises by reference to principle in Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589. Practice and procedure – Whether defences sought to be raised in recovery proceedings an abuse of process. Words and phrases – "abuse of process", "Anshun estoppel", "control", "estoppel", "group member", "group proceeding", "lead plaintiff", "opt out notice", "privy", "unreasonable". Supreme Court Act 1986 (Vic), Pt 4A. FRENCH CJ, KIEFEL, KEANE AND NETTLE JJ. The appellant, Timbercorp Finance Pty Ltd (in liquidation) ("Timbercorp Finance"), is a subsidiary of Timbercorp Ltd (in liquidation) ("Timbercorp Ltd"). Its purpose was to provide loans to investors in horticultural and forestry projects which were operated as managed investment schemes by Timbercorp Ltd from about 1992. Timbercorp Securities Ltd (in liquidation) ("Timbercorp Securities") replaced Timbercorp Ltd as the responsible entity of the schemes. Each of the companies was a member of the "Timbercorp Group", and was placed in liquidation in June 2009. A group proceeding was commenced in the Supreme Court of Victoria in the Supreme Court Act 1986 (Vic) by October 2009 under Pt 4A of Mr Woodcroft-Brown ("the lead plaintiff") against Timbercorp Finance, Timbercorp Securities and certain of their directors ("the group proceeding"). The group proceeding was brought on Mr Woodcroft-Brown's behalf and on behalf of persons who, at any time during the period between 6 February 2007 and 23 April 2009 ("the relevant period"), acquired or held an interest in a managed investment scheme of which Timbercorp Securities was the responsible entity. The relief sought by the lead plaintiff against Timbercorp Finance included orders declaring that it was involved in contraventions of a number of the provisions of the Corporations Act 2001 (Cth), the Corporations Law (set out in s 82 of the Corporations Act 1989 (Cth)), the Fair Trading Act 1999 (Vic), the Trade Practices Act 1974 (Cth) and the Australian Securities and Investments Commission Act 2001 (Cth); damages under provisions of those statutes; and a declaration that the lead plaintiff and the group members not be liable for any loans, fees or costs in connection with the schemes in question. The group proceeding was not successful at trial1 or on appeal2. Some, but not all, of the members in the group proceeding had applied for loans from the appellant to fund their investments, in whole or in part, or costs associated with the schemes. The respondents in the present appeals – Mr and Mrs Collins and Mr Tomes – were group members who had applied for loans in the period between May and October 2008. In the proceedings the subject of these appeals, which were brought by the liquidators in 2014, it is alleged that agreements for loans were concluded between the appellant and the respondents and that the respondents defaulted on their payments under those agreements in July 2009. 1 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240. 2 Woodcroft-Brown v Timbercorp Securities Ltd (in liq) (2013) 96 ACSR 307. Nettle The respondents have filed defences in these proceedings. In its reply to each of those defences, the appellant pleads that the respondents are precluded from raising their defences on account of their membership in the group proceeding. The preclusion is said to arise as a matter of law. The appellant contends that either the respondents are estopped from raising the matters in their defences or the defences constitute an abuse of process. The estoppel to which the appellant refers is not an issue estoppel, but rather one which arises by reference to the principle in Port of Melbourne Authority v Anshun Pty Ltd3 ("Anshun"). In essence, the appellant contends that the respondents should be estopped from pursuing their defences because they could and should have raised them for determination in the group proceeding. In their rejoinders filed in the proceedings, the respondents take issue with these allegations. The question as to what defences may now be pursued by the respondents was ordered to be determined as a separate question4, framed in these terms: "Are the defendants precluded from raising any and if so what defences pleaded by them in this proceeding by reason of their participation as group members within the meaning of [Pt 4A] of the Supreme Court Act 1986 (Vic) in [the group proceeding]?" The answer given to that question, by Robson J5, was that the respondents are not precluded from raising any of their defences. Leave was granted by the Court of Appeal of the Supreme Court of Victoria to appeal that decision, but the appeals were dismissed6. The group proceeding The claims and common questions Mr Woodcroft-Brown was the lead plaintiff in the group proceeding. Before the trial of the proceeding another person, Mr Van Hoff, was appointed to (1981) 147 CLR 589; [1981] HCA 45. 4 Pursuant to Supreme Court (General Civil Procedure) Rules 2005 (Vic), r 47.04. 5 Timbercorp Finance Pty Ltd (In Liq) v Collins [2015] VSC 461. 6 Timbercorp Finance Pty Ltd (In Liquidation) v Collins [2016] VSCA 128. Nettle represent a sub-group. It would appear that it became necessary to consider separately group members who were involved in recent schemes, that is, the schemes subscribed to during the relevant period, and those who were involved in early schemes, being the schemes which pre-dated the relevant period. The lead plaintiff had invested in the recent schemes, and Mr Van Hoff had invested in both the recent schemes and the early schemes. The appellant in these proceedings, Timbercorp Finance, was the fifth defendant in the group proceeding. Timbercorp Securities was the first defendant and the principal focus of the lead plaintiff's case. Timbercorp Finance became a plaintiff by counterclaim in the group proceeding when it sought to recover monies alleged to be owed by Mr and Mrs Woodcroft-Brown under their loan agreement with it. The lead plaintiff's case was pleaded in a complex, confusing way despite being the subject of a series of amendments. However, as the trial judge, Judd J, observed7, the case was essentially that Timbercorp Securities had failed to disclose information about risks, which it was required to disclose in compliance with its statutory obligations. The overall theme of the lead plaintiff's case was that the fortunes of the schemes were linked to the viability of the Timbercorp Group. There were said to have been risks associated with Timbercorp Securities' financial structure. It was alleged that they should have been disclosed because they were significant or material to a decision to invest in the schemes. This was described as a "structural risk", a risk that the group might fail due to insufficient cash and having a consequent impact on the viability of the schemes managed by Timbercorp Securities. The lead plaintiff alleged that the structural risk should have been disclosed in the Product Disclosure Statement which Timbercorp Securities was required to give with any invitation to invest. The lead plaintiff also argued that there were two critical events which occurred on and after 6 February 2007 which put the Timbercorp Group at a heightened risk of failure and which should have been disclosed. One was an announcement about a proposal by the Australian Taxation Office to change its position with respect to the deductibility of certain fees paid by investors. The other was the global financial crisis, which had an impact upon the availability of credit. These were described as the "adverse matters". The lead plaintiff also 7 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 247 [24]. Nettle alleged that the failure to disclose these matters when they occurred constituted misleading and deceptive conduct by silence. The misrepresentations alleged by the lead plaintiff fell into two categories: "financial representations", which were to the effect that the Timbercorp Group was sufficiently strong such that investors could expect Timbercorp Securities to manage the schemes to their end, and that the principal risks had been fully disclosed; and "scheme contributions representations", which were to the effect that investors' contributions would be applied only to the particular scheme in which they had invested, which is to say they were to be quarantined from the group as a whole and not pooled with other funds. With respect Judd J found that either there was no need to disclose the matters identified in the lead plaintiff's pleading or the matters were not material to a invest8. the alleged decision by group members misrepresentations, his Honour found9 that the first of them was either too vague or too uncertain to be actionable and that there were in any event reasonable grounds for confidence in the strength of the Timbercorp Group at the time. The second set of representations was inconsistent with the Product Disclosure Statements and other generally available information and was not consistent with the lead plaintiff's claims concerning reliance on the strength of the Timbercorp Group10. His Honour also found11 that the lead plaintiff's and Mr Van Hoff's cases on reliance lacked credibility and were implausible. Following delivery of his reasons Judd J made orders dismissing the lead plaintiff's claims and the claim of Mr Van Hoff, which had been heard at the same time. His Honour made an order declaring the persons who were bound by the orders, for the purposes of s 33ZB in Pt 4A, and made orders as to the notices to be given to group members. His Honour annexed a list of 33 common questions in the group proceeding, the terms of which had been the subject of argument, and answered them. It is not necessary to set them out. They were directed to the disclosure obligations of Timbercorp Securities and the 8 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 312 9 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 251 [42]. 10 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 252 [45]. 11 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 258 Nettle allegations that companies in the Timbercorp Group had engaged in misleading and deceptive conduct. The course of the group proceeding and the respondents' participation in it The respondents agreed to participate in a group proceeding at an early point, before it was constituted with a lead plaintiff and a pleading settled. They had received a circular from the solicitors for the lead plaintiff and certain group members, who had carriage of the foreshadowed group proceeding ("the solicitors"). The circular identified non-disclosure by Timbercorp Securities as the basis for the action and advised that investors could withhold loan repayments and claim repayment of monies already paid if they joined the group proceeding. A later circular confirmed the advice to withhold further loan payments and stated that, if the matter proceeded to court, it would be argued that the loans were invalid. After the group proceeding had been instituted Mr Tomes sent an email to the solicitors in which he explained how he had come to make his investments. He gave details of representations which had been made to him about what would occur if he fell on hard times. It would appear that the solicitors did not bring these matters to the attention of the Court during the group proceeding. These alleged misrepresentations form part of the defence which Mr Tomes seeks to pursue against the appellant. A couple of months after the commencement of the group proceeding, the solicitors provided a report to investors about a directions hearing which had taken place in the Supreme Court. They advised that the Court wished to hear submissions about whether the existing claim would be expanded to include any other claims based on misleading and deceptive conduct in connection with the promotion and sale of the schemes. The solicitors advised that they were examining projects which might result in new claims. lead plaintiff concerning the allegations made by An "opt out" notice was approved by Judd J and sent to investors. It identified the the non-disclosures and misrepresentations. Investors were advised that they could be bound by the outcome of the action if they did not opt out and that "you will not be able to make the same claim in any other proceedings". Shortly thereafter, the solicitors sent a circular to investors advising that for those investors who did not opt out the solicitors would "continue handling their individual file and the They said that individual issues "on an ancillary class action file". investor-by-investor basis" would be worked through on the basis of the Court's findings on the issues that were common to everyone. Nettle Both Mr Collins and Mr Tomes read the opt out notice. Mr Tomes said that he took the reference to individual files to mean that his specific case was being looked after. Mr Collins did not consider that there were any individual issues which concerned him and his wife which were not covered by the common questions. The respondents did not elect to opt out. Some investors did. A revised opt out notice was provided to group members. It was occasioned by some amendments which had been made by the lead plaintiff. Group members were advised that if they did not opt out the "class action" would determine their rights. They would be bound by the judgment in it and would "not be able to make the same claim in any other proceedings". The respondents did not opt out. At a directions hearing some months prior to the commencement of the hearing of the group proceeding, Judd J ordered that the counterclaim, together with some third party proceedings not presently relevant, be tried separately from the main proceeding and after the determination of the group proceeding questions. Apart from the claims of the lead plaintiff and Mr Van Hoff, no other individual claims by group members were the subject of directions as to their determination by Judd J. There is no suggestion that any of the parties to the group proceeding suggested any such course of action. The hearing proposed and actually undertaken was concerned only with the common questions raised in the group proceeding. The respondents' defences in these proceedings The Collins' defence The amended defence of Mr and Mrs Collins in the proceedings brought by the appellant, Timbercorp Finance, against them contains two principal claims: that they did not acquire an interest in the project in which they sought to invest through Timbercorp Securities and that no loan was advanced to them by the appellant for that purpose. The first-mentioned claim is based largely on the requirements of the constitution of the project and Timbercorp Securities' inability to comply with it. As a result, it could neither release application monies for the purpose of an allotment of any interest in the project nor allot such an interest to them. As to the second, it is alleged that it was a condition of the loan agreement that the appellant pay monies to Timbercorp Securities on their behalf. However, upon receipt of their application for a loan the appellant paid monies to a trust company, which in turn paid them to Timbercorp Ltd, which then used them in the conduct of its business. Nettle Mr and Mrs Collins contend, in the alternative, that the loan offers were unconscionable conduct, in contravention of the Australian Securities and Investments Commission Act 2001 (Cth). They further allege that if they are required to pay loan monies to the appellant, it would be unjustly enriched by reason that it has not made an actual monetary payment and has therefore suffered no loss. Mr Tomes' defences In his amended defence Mr Tomes alleges that no loan agreement was concluded between him and the appellant, by reason that the person who purported to execute the loan documentation on his behalf had not been appointed as his attorney. He also contends that monies were not applied to fund payments he owed with respect to his interests and loan fees, as the loan agreement required, but rather for the purposes of the Timbercorp Group. The application of the Corporations Act 2001 (Cth) in that Timbercorp Securities was required to hold the monies as trustee for him and the appellant was involved in that contravention. If the appellant is entitled to retain the payments, it would be unjustly enriched, either because the monies were paid under a mistake of fact or because there has been a failure of consideration. the Timbercorp Group contravened these funds Mr Tomes also pleads that a series of representations were made to him by a person who was an agent of both the appellant and Timbercorp Securities concerning his first loan agreement. The effect of these representations was that the appellant would not seek recourse against Mr Tomes in the event of his default under the loan agreement, as it would not need to do so because the value of the lots acquired by him would always exceed the amount of the loan and it could simply resell them; all funds borrowed by him would be applied solely to pay for the relevant lots; the projects were sustainable and would continue even if Timbercorp Securities ceased to be the responsible entity; and the project for which he was obtaining finance was a fully funded investment. Estoppel It was mentioned at the outset of these reasons that the appellant does not contend that an issue estoppel arises with respect to the claims that the respondents now seek to pursue. That is to say, it is not argued that they involve an issue of fact or law which was necessarily involved as a step in reaching the Nettle determination of the group proceeding12. Rather, it is contended that these claims ought to have been raised and determined in that proceeding. An estoppel of this kind, an "Anshun estoppel"13, will preclude the assertion of a claim or of an issue of law or fact if the claim or issue was so connected to the subject matter of the first proceeding as to make it unreasonable, in the context of the first proceeding, for the claim or issue not to have been made or raised in it14. The appellant's arguments The appellant submits that an obvious connection between the respondents' defences and the group proceeding is that they seek to achieve the same result, namely avoiding repayment of the loan obligations. The respondents' loan agreements were the subject of the group proceeding in the sense that they were sought to be rendered void or unenforceable by reason of the claims there made. The appellant further submits that the fact that the group members held interests in the schemes was a fundamental assumption upon which the group proceeding was based. It went to the root of the matter in the way discussed in Hoysted v Federal Commissioner of Taxation15. Likewise it was assumed for the purposes of the group proceeding that loan agreements between the appellant and the respondents were actually entered into. Now the respondents seek to argue to the contrary – that there were no concluded agreements for loans and thus no loans. This has the potential that the two proceedings could produce declarations of inconsistent rights. As to the representations upon which Mr Tomes seeks to rely, the appellant says that they closely match those in the group proceeding. 12 See Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 757 [22]; 323 ALR 1 at 7; [2015] HCA 28; Hoysted v Federal Commissioner of Taxation (1925) 37 CLR 290; [1926] AC 155. 13 Also referred to as the "extended principle" in Henderson v Henderson (1843) 3 Hare 100 [67 ER 313]: Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 757 [22]; 323 ALR 1 at 7. 14 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 757 [22]; 323 ALR 1 at 7-8; Hoysted v Federal Commissioner of Taxation (1925) 37 CLR 15 (1925) 37 CLR 290; [1926] AC 155. Nettle the lead plaintiff In particular, the group proceeding pleaded a misrepresentation that his funds would effectively be quarantined and not pooled with other funds. This led to a finding by Judd J16 that the lead plaintiff's assertion in this regard was not consistent with what had been stated in the Product Disclosure Statements. The appellant submits that it was unreasonable of the respondents not to use the statutory safeguards provided for by opting out of the group proceeding or by raising the matters of defence as claims in that proceeding. An aim of the statutory provisions for group proceedings is the efficient use of judicial resources and this requires that lawyers and individuals be encouraged to bring similar or related claims in the one set of proceedings17. The relevant question, the appellant submits, is whether the defences in these proceedings are so similar to issues in the group proceeding that the respondents should be precluded from pursuing them. The enquiry begins and ends with similarity, regardless of whether it was practicable to have litigated the claims in the group proceeding. Were it otherwise, framing a claim as personal to the particular plaintiff would always provide an answer to an Anshun estoppel. In any event, the appellant submits that there is no reason to think that the matters raised in the defences could not have been determined in the group proceeding. The ever-expanding claims in the group proceeding could have accommodated them. Instead the appellant now faces hundreds of separate proceedings which are to be determined on much of the same evidence which was led in the group proceeding. The appellant submits that there is no injustice in precluding the respondents from raising their defences. They were not helpless or passive as group members. To say that they did not have control over their part in the proceeding does not fully describe the way Pt 4A works and does not take account of the powers which the Court may exercise. In that regard, the Court could have made directions for the determination of the respondents' claims in the group proceeding had it been asked to do so. 16 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 286-287 17 Australian Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46, (1988) at 117 [283]. Nettle The appellant's arguments also focus on another aspect of a group proceeding, namely, the representative capacity of the lead plaintiff in that proceeding. It is submitted that group members are privies in interest with the lead plaintiff in a group proceeding, because that person represents their legal interest. In the appellant's submission, recognition of that shared interest "narrows inevitably the relevant considerations on reasonableness" in connection with estoppel. It is convenient to deal with that aspect of the appellant's arguments first. Group members as privies A person (the "second party") who seeks to make a claim in later proceedings may be bound by the actions of a party in earlier proceedings if the party in those proceedings represented the second party such that they could be described as the privy in interest of the second party. The same principle which is applied to determine when a party in earlier proceedings may be said to be a privy in interest of the second party applies with respect to all forms of estoppel18. The interest in question is required to be a legal one. If the appellant is correct in its submissions concerning the privy relationship between the lead plaintiff in the group proceeding and the respondents as group members, the enquiry becomes whether the lead plaintiff would have been estopped. The nature of the enquiry does not alter. It remains whether the respondents' claims were so connected to the subject matter of the group proceeding as to make it unreasonable for their claims not to have been made. However, the question is directed at whether the lead plaintiff in the group proceeding should have done so, rather than the respondents in these proceedings. (The question whether the respondents, acting reasonably, should themselves have raised their claims will be addressed later in these reasons.) The reason for the appellant's focus on the position of the lead plaintiff in a group proceeding may be understood by reference to the level of involvement or control that the lead plaintiff has, compared with a group member. The argument must be that, since the lead plaintiff has the carriage of the proceedings and, subject to the Court's case management powers, determines what claims are to be put forward, there is good reason for the lead plaintiff to include for determination in the group proceeding claims by group members which are connected to the group proceeding. 18 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 757 [23], 758 [28]; 323 ALR 1 at 8, 9. Nettle The question whether the lead plaintiff in the group proceeding should himself have sought to have the respondents' claims included in the group proceeding is a question which is reached only if the appellant is correct in its submission that the lead plaintiff was the privy in interest of the respondents with respect to their individual claims. For the reasons which follow, he was not. The appellant submits that the representation of group members' interests by a lead plaintiff in a group proceeding is not limited to the legal interest in the common questions in that proceeding. It submits that group members, such as the respondents, are privies in interest of the lead plaintiff not only with respect to the claims pleaded in that proceeding, but also with respect to unpleaded claims of individual group members that should have been raised. It would follow that if the lead plaintiff in that proceeding did not bring forward those claims for determination, the group members will be unable to pursue them later. The appellant submits that if the lead plaintiff in a group proceeding is not viewed in this way, the principle in Anshun could never apply to individual claims in a group proceeding. But the appellant does not explain why the principle should apply in this way. If the appellant's argument was correct it would give estoppels a wide operation in the context of a group proceeding, on account of it being a proceeding of that nature. It is therefore necessary to consider the nature and subject matter of group proceedings under Pt 4A, the role of the lead plaintiff in them and the legal interests which the lead plaintiff represents. Representative proceedings have, in some form, historically been permitted under the Rules of the Supreme Court of Victoria at least since 191619. They were modelled on the English rules and can be traced back to the practice of the Chancery Court. The old rule of the Chancery Court was that, in order to achieve finality, the presence before the Court of all the parties interested in the matter was required. However, the rule did not apply where the parties were too numerous. It was said that "[i]t was originally a rule of convenience: for the sake of convenience it was relaxed"20. The Victorian Rules were modified over the years. It is not necessary to detail that history. Part 4A took effect from 1 January 2000 and was based on 19 See P Dawson Nominees Pty Ltd v Multiplex Ltd (2007) 242 ALR 111 at 121 [43] 20 Duke of Bedford v Ellis [1901] AC 1 at 8 per Lord Macnaghten. Nettle federal legislation for representative proceedings21. The report of the Australian Law Reform Commission ("the ALRC")22, which preceded the enactment of the federal legislation, envisaged that grouping procedures in cases of multiple wrongdoing might reduce costs and inefficiencies and other barriers which impede access to legal remedies. Gleeson CJ was later to observe23 that, although there may be differences of opinion about the legislative policy underlying group proceedings, the primary object of Pt 4A is clear enough: "It is to avoid multiplicity of actions, and to provide a means by which, where there are many people who have claims against a defendant, those claims may be dealt with, consistently with the requirements of fairness and individual justice, together." As his Honour pointed out, the State has an interest in preventing relitigation of common issues of fact and law so far as it can be done consistently with the requirement of justice to all parties. For the purposes of Pt 4A, s 33A relevantly defines a "plaintiff" of a group proceeding as "a person who commences a group proceeding as a representative party" and a "group member" as "a member of a group of persons on whose behalf a group proceeding has been commenced". It may be observed that group membership under Pt 4A does not require any choice to be exercised. There is no "opt in" procedure provided. A group member can "opt out"24. More importantly for present purposes, there can be little doubt that the plaintiff in the group proceeding has a representative role. In a passage in the joint reasons in Tomlinson v Ramsey Food Processing Pty Ltd, upon which the appellant relies, it was observed25 that traditional forms 21 Federal Court of Australia Act 1976 (Cth), Pt IVA. 22 Australian Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46, (1988) at 8 [13], 34 [69]. 23 Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 24 [12]; [2002] HCA 24 Supreme Court Act 1986 (Vic), s 33J. 25 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 760-761 [40]; 323 ALR 1 at 12, citing Carnie v Esanda Finance Corporation Ltd (1995) 182 CLR 398; [1995] HCA 9, which concerned Supreme Court Rules 1970 (NSW), Pt 8. Nettle those represented to estoppels representation which bind include representation by an agent, by a trustee, by a tutor or guardian and "representation by another person under rules of court which permit representation of numerous persons who have the same interest in a proceeding". The joint reasons went on to say that "[t]o those traditional forms of representation can be added representation by a representative party in a modern class action"26. These latter forms of representation, it was observed27, are the subject of procedures such as opt in or opt out which guard against the collateral risks of representation, such as an estoppel. The joint reasons in Tomlinson referred to representative proceedings for the purpose of comparison with the proceedings there in question, which were commenced by a statutory office-holder in the exercise of a power conferred by statute. Proceedings of that kind may result in the enforcement of another person's legal entitlement, but the office-holder may not be concerned with the interests of that person in the discharge of the statutory function. By implication, plaintiffs in representative proceedings may be so concerned, not the least because they share the same interest as group members in the matter litigated. It was not necessary in Tomlinson to decide that a group member might be a privy in interest of the plaintiff in group proceedings, but it may be taken to acknowledge that such a relationship may arise. That acknowledgement does not, however, answer the question as to the extent to which the plaintiff in group proceedings may be taken to represent the legal interest of the group members. The answer to that question lies in the nature of a group proceeding and the commonality of interest that may be pursued in it. Section 33C(1) provides: "Subject to this Part, if – seven or more persons have claims against the same person; and the claims of all those persons are in respect of, or arise out of, the same, similar or related circumstances; and 26 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 761 [40]; 323 ALR 1 at 12, citing Zhang v Minister for Immigration, Local Government and Ethnic Affairs (1993) 45 FCR 384, which concerned Federal Court of Australia Act 1976 (Cth), Pt IVA. 27 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 761 [40]; 323 ALR 1 at 12-13. Nettle the claims of all those persons give rise to a substantial common question of law or fact – a proceeding may be commenced by one or more of those persons as representing some or all of them." Section 33H provides that the indorsement on the writ, by which the group proceeding must be commenced, must identify the group members to whom the proceeding relates; specify the nature of the claims made on behalf of the group members and the relief claimed; and "specify the questions of law or fact common to the claims of the group members". These provisions identify the subject matter of a group proceeding as a claim which gives rise to common questions of law or of fact. The plaintiff represents the group members with respect to their interests in that regard and the group members claim through the plaintiff to the extent of that interest. Their relationship is therefore that of privies in interest28 with respect to that claim. However, other provisions of Pt 4A also make plain that group members may have other, individual, claims which do not form part of the subject matter of the group proceeding. Group members' claims were also the subject of discussion by the ALRC in its report. The ALRC, whilst recognising that the grouping of many claims into one proceeding involving at least one common question of law or fact might have benefits, also recognised that there may be issues which must be decided separately in relation to each group member29. And in Wong v Silkfield Pty Ltd30, this Court held that it was not necessary for a representative proceeding to be likely to resolve wholly, or even to any significant degree, the claims of all group members. Section 33Q provides that where it appears to the Court that the determination of the questions common to all group members will not finally determine the claims of all group members, the Court may give directions in relation to the determination of the remaining questions and for that purpose may establish sub-groups. Section 33R allows the Court to permit an individual group member to take part in the proceeding for the purpose of determining a question 28 See Ramsay v Pigram (1968) 118 CLR 271 at 279; [1968] HCA 34. 29 Australian Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46, (1988) at 75 [169]. 30 (1999) 199 CLR 255 at 267 [28], 267-268 [30]; [1999] HCA 48. Nettle that relates only to the claim of that group member. In this circumstance, however, the group member is liable for the costs associated with the determination of that question, a liability which does not generally arise in the group proceeding itself. Part 4A creates its own kind of statutory estoppel. Section 33ZB requires that a judgment in a group proceeding identify the group members affected by it and, subject to a provision not presently relevant, provides that that judgment "binds all persons who are such group members at the time the judgment is given". In order to understand that to which the group members are bound, it is necessary to read s 33ZB in the context of Pt 4A as a whole and ss 33C(1) and 33H in particular. By that process it will be seen that group members are bound by the determination of the claims giving rise to the common questions. The provisions of Pt 4A therefore confirm that a plaintiff in group proceedings represents group members only with respect to the claim the subject of that proceeding, but not with respect to their individual claims. The lead plaintiff is not a privy in interest with respect to the respondents' claims. This is so regardless of whether they should have been raised in the group proceeding. That leaves for consideration the question whether the respondents themselves are estopped from raising them in these proceedings. A conclusion that the representative capacity of a plaintiff in a group proceeding is limited to the claims giving rise to common questions is consistent with principles which underlie the concept of a privy in legal interest. The basic requirement of a privy in interest is that the privy "must claim under or through the person of whom he is said to be a privy"31. The principle underlying the concept of privies is that "one who claims through another is, to the extent of his claim, subject to … all estoppels affecting the person through whom he claims"32. That principle is in turn informed by the theory that a person who takes a benefit ought also to bear a burden33. With the benefit of the claim comes the detriment 31 Ramsay v Pigram (1968) 118 CLR 271 at 279 per Barwick CJ. 32 Ramsay v Pigram (1968) 118 CLR 271 at 273-274 reflecting Everest, Everest and Strode's Law of Estoppel, 3rd ed (1923) at 55, cited in Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 758 [28]; 323 ALR 1 at 9. 33 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 758 [29]; 323 ALR 1 at 10. Nettle of the estoppel. But, as explained in Tomlinson34, it is a theory which has its limitations. It would be quite unjust for a person whose legal interests stood to benefit by making a legal claim to be precluded if they did not have some measure of control of the proceedings in question. As has been observed earlier in these reasons, the control of group members such as the respondents is limited. Relevance and reasonableness The appellant's submission, that an Anshun estoppel is made out by reference to similarities between the matters raised in the two proceedings, regardless of whether the matters sought to be raised in the present proceedings could practicably have been raised in the group proceeding, is contrary to authority on two levels. An Anshun estoppel is not based upon degrees of similarity, which may be a matter of impression. It was made clear in Anshun35 that there could be no estoppel "unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it" (emphasis added). It was further explained36: "Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding." In Anshun the owner of the crane which was involved in an accident was prevented from pursuing separate proceedings in which it sought an indemnity from the hirer of the crane, when it had only claimed contribution from the hirer in the first proceeding. It would have been expected that the owner would have sought an indemnity in the first proceeding and litigated the questions of law and fact relevant to it. By way of contrast, in these proceedings, it could hardly be said to have been expected that the respondents would raise their individual issues about their 34 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 760 [39]; 323 ALR 1 at 12. 35 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 602. 36 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 602. Nettle loan agreements referred to above in the group proceeding, where the common issues were undisclosed risks and misrepresentations affecting the entry of investors into the schemes. The only connection between those matters and their loan agreements was the relief sought regarding the enforceability of the loan agreements. There was no issue in the group proceeding about the validity of the loan agreements which would have made the claims in the respondents' defences relevant in the group proceeding. Even if the respondents' claims were relevant to those in the group proceeding, there remain, contrary to the appellant's submissions, questions as to whether they could, and should, have been raised in that proceeding. In Anshun it was acknowledged37 that there may be a variety of circumstances which may justify a party refraining, reasonably, from litigating an issue in the earlier proceedings. The appellant's argument – that the group proceeding was litigated on the basis of assumptions of fact – does not rely upon any similarity between the proceedings but rather the potential for there being inconsistent findings. In Anshun it was regarded38 as generally accepted that a party will be estopped from bringing an action where, if it succeeds, it would result in a judgment which conflicts with an earlier judgment. In such a circumstance the litigation should be regarded as concluded by the earlier proceedings. Anshun itself provides an example of how such an inconsistency might arise. A finding had been made that the hirer was liable to provide contribution to the owner with respect to the injuries; and a finding that the hirer was liable to provide a complete indemnity was later sought. But in these proceedings there is no question of inconsistency arising with respect to findings as to the respondents' claims. No issue was raised, and no finding was made, in the group proceeding about these matters. There was no particular assumption about the loan agreements upon which the group proceeding was based, apart from their existence. Contrary to the appellant's submissions, this is not a case like Hoysted39, where the Commissioner was estopped from raising an issue of mixed fact and law which had been the subject of admission by him in the earlier proceeding. 37 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 602-603. 38 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 603. 39 Hoysted v Federal Commissioner of Taxation (1925) 37 CLR 290; [1926] AC 155. Nettle It was there said40 that the admission of a fact fundamental to the decision arrived at cannot be withdrawn and fresh litigation started with a view to obtaining a judgment based upon a different assumption of facts. If this were permitted, litigation would not have the finality deemed desirable. But the present case involves no such admission. In Hoysted it was said41 that the same principle, that of setting to rest the rights of litigants, applies to a case where a point, fundamental to the decision, has not been traversed. But, in this case, it cannot be said that the lead plaintiff's failure to raise in the group proceeding the issues now raised by the respondents in these proceedings was fundamental to Judd J's decision in the group proceeding. The lead plaintiff's claim in the group proceeding alleged the existence of the loan agreements and that was the assumption on which the claim proceeded. The lead plaintiff sought relief from obligations under the loan agreements on the basis of the contraventions of the Corporations Law, the Corporations Act 2001 (Cth), the Fair Trading Act 1999 (Vic), the Trade Practices Act 1974 (Cth) and the Australian Securities and Investments Commission Act 2001 (Cth) which were alleged in the group proceeding. But, for all intents and purposes of the group proceeding, the efficacy of the loan agreements was not adverted to. Judd J made no determination as to whether they were efficacious. In effect, his Honour determined only that, assuming the existence of the loan agreements, the borrowers were not entitled to the relief from their obligations under the loan agreements on the basis of the misrepresentations alleged in the group proceeding. The bases for seeking to avoid the loan agreements were entirely different from the matters now sought to be agitated. It is correct that one of the representations upon which Mr Tomes seeks to rely is similar to that made by the lead plaintiff in the group proceeding, to the effect that he was led to believe that his funds would be quarantined from other funds and applied only to his investments. Judd J found42 that such a representation was inconsistent with information provided in the Product Disclosure Statements. However, unlike the representation relied on by the lead plaintiff in the group proceeding, the representation relied upon by Mr Tomes 40 Hoysted v Federal Commissioner of Taxation (1925) 37 CLR 290 at 299; [1926] AC 155 at 165. 41 Hoysted v Federal Commissioner of Taxation (1925) 37 CLR 290 at 299; [1926] AC 155 at 166. 42 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240 at 252 [45]. Nettle does not stand alone; it is said to have been made in the context of other representations which were entirely personal to him. Moreover, although, as has been observed, it appears that the solicitors did not bring the representations alleged by Mr Tomes to the attention of the Court during the group proceeding, it may be inferred from the fact that Judd J made an order postponing the determination of the counterclaim in the group proceeding that his Honour was not disposed to determine any claim other than those in the group proceeding. Further, Mr Tomes would have been exposed to a liability for costs of the determination of his individual claim with the group proceeding43. In Anshun44 the expense of litigating was given as an example of a circumstance which might justify a person not raising an issue in earlier proceedings. The appellant's submission that the respondents should have opted out of the group proceeding45 takes its case no further. It is necessarily based upon the notion that the lead plaintiff in the group proceeding represented the respondents with respect to their unpleaded claims as well as those common claims which were the subject of that proceeding. This contention has been dealt with above. There was no need for the respondents to opt out in order to preserve their position with respect to the claims now the subject of the defences. More generally, the appellant's submissions respecting the control that the respondents had in relation to the group proceeding appear to be based upon a misapprehension of the ability of a group member to have his or her individual claim decided and, more particularly, a misunderstanding of the case management powers given by Pt 4A to the Court to determine what is to be heard and when. Those powers are considerable. They include the power to decide whether the proceeding continues as a group proceeding46; whether the lead plaintiff needs to be substituted to provide better representation47; as to the determination of questions which remain after the resolution of the common 43 Pursuant to Supreme Court Act 1986 (Vic), s 33R. 44 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 603. 45 Pursuant to Supreme Court Act 1986 (Vic), s 33J. 46 Supreme Court Act 1986 (Vic), s 33N. 47 Supreme Court Act 1986 (Vic), s 33T. Nettle questions48; and, most relevantly, whether the claim of a group member can be determined in the group proceeding49. These powers have further relevance with respect to the other limb of the appellant's argument, that the defences are an abuse of process. Abuse of process? The appellant submits that the respondents' defences may constitute an abuse of process even if the group proceeding does not give rise to an estoppel. So much was recognised in Tomlinson50, where it was pointed out that abuse of process is inherently broader and more flexible than estoppel and is capable of application in any circumstances in which the use of a court's procedures would be unjustifiably oppressive to a party or would bring the administration of justice into disrepute. The damage to the administration of justice which the appellant identifies is said to lie in the Supreme Court being denied the opportunity, in the group proceeding, of determining how best to manage the issues raised in the defences in the context of all the common claims. The appellant points to what was said by the ALRC with respect to the then proposed federal legislation for representative proceedings51, namely that it was intended to facilitate claims and strengthen case management powers, given the burdens that complex litigation can put on the judicial system and the parties. If all group members have an unfettered right to pursue their claims individually, the goal of judicial economy would not be fulfilled52. The latter reference is taken out of context. The ALRC was not suggesting that a group member should not be permitted to pursue an individual claim outside the group proceeding. Part 4A itself acknowledges that this will 48 Supreme Court Act 1986 (Vic), s 33Q. 49 Supreme Court Act 1986 (Vic), s 33R. 50 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 757-758 [25]-[26]; 323 ALR 1 at 8-9. 51 Australian Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46, (1988) at 70 [157], 131 [320], 137 [333]. 52 Australian Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46, (1988) at 79-80 [185]. Nettle occur. Rather it was saying that where claims were such that they could be determined as a group, they should be. That will arise where there is a common question or issue. Consistently with the issues of efficiency and better use of court resources, Pt 4A provides the Court with overall management of a group proceeding, with powers to determine how and when individual claims might be heard either in connection with, or separately from, the group proceeding53. These powers are to be exercised consistently with the aims of Pt 4A, as no doubt they were when Judd J postponed the counterclaim to after the determination of the claims in the group proceeding. His Honour was no doubt aware of the possibility, if not the fact, that there were other claims, as is evident from the discussions reported from the early directions hearing. But there is nothing to suggest that their determination was considered by his Honour to be necessary to the management and determination of the group proceeding. To the contrary, it may reasonably be inferred that they were not. At most it may be said that the respondents' claims were not brought to the attention of the Court. It could not be said that the failure to do so affected the case management decisions open to the Court. There is no reason to suppose that knowledge of the respondents' claims would have altered the course that the Court took. In these circumstances, raising the defences in these proceedings can in no way be said to amount to an abuse of process. To the contrary, the preclusion of the respondents' defences to the appellant's claims would be unwarranted in principle and therefore unjust. Orders The appeals should be dismissed with costs. 53 Supreme Court Act 1986 (Vic), ss 33Q, 33R, 33S. GORDON J. The appellant in both appeals, Timbercorp Finance Pty Ltd (in liq), was part of the Timbercorp Group of companies, which invested in agribusiness managed investment schemes on behalf of some 18,500 investors. Many, but not all, investors in the schemes entered into loan agreements to finance their investments. Each respondent in each appeal was an investor and a party to a loan agreement. The respondents were group members in a group proceeding commenced under Pt 4A of the Supreme Court Act 1986 (Vic) ("the Act") against several defendants, including the appellant, in relation to the schemes. The group proceeding was unsuccessful. The appellant then commenced recovery proceedings against each of the respondents, alleging that the respondents were in default of their loan agreements. Are the respondents precluded from relying on certain defences in the recovery proceedings on the basis that they did not raise the issues in the group proceeding or opt out of the group proceeding, either because (1) an "Anshun estoppel"54 arises against them; or (2) relying on the defences is an abuse of process? Neither basis precludes any of the respondents from raising the defences they propose to raise. Each appeal should be dismissed with costs. Facts Mr and Mrs Collins On 12 June 2008, the respondents in M98 of 2016, Mr and Mrs Collins, applied to the appellant for a loan for the acquisition of 10 grove lots in the "2008 Olive Early Project" ("the 2008 project"), a registered managed investment scheme operated by Timbercorp Securities Ltd (in liq), another member of the Timbercorp Group. On 15 June 2008, Mr and Mrs Collins were advised that their applications for the lots and for finance had been accepted. The appellant alleges that the loan was paid to Trust Company of Australia Ltd as custodian and agent for Timbercorp Securities and that thereby the appellant made a loan to Mr and Mrs Collins in accordance with the terms of the loan agreement. 54 After Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45. Mr Tomes On or about 8 May 2008, the respondent in M101 of 2016, Mr Tomes, applied to the appellant for a loan to fund part of the cost of his initial investment in the 2008 project as well as another registered managed investment scheme operated by Timbercorp Securities, the "2007 Almond Post June Project". On or about 31 October 2008, Mr Tomes applied to the appellant for a further loan to fund the payment of amounts relating to his investment in the two projects. The appellant alleges that the loan amounts were paid under two separate loan agreements – the first amount being paid to the custodian and agent for Timbercorp Securities and the second to Timbercorp Securities – and that thereby the appellant made loans to Mr Tomes in accordance with the terms of those agreements. Collapse of the Timbercorp Group and the subsequent group proceeding In April 2009, the companies comprising the Timbercorp Group went into administration and then, in June 2009, were put into liquidation. At that time, the appellant's loan book totalled $477.8 million comprising over 14,500 outstanding loans to over 7,500 borrowers, including the loans to the respondents. On 27 October 2009, a proceeding was commenced in the Supreme Court of Victoria under Pt 4A of the Act by Mr Allen Rodney Woodcroft-Brown ("the lead plaintiff") as plaintiff on his own behalf and on behalf of group members against Timbercorp Securities, the appellant and various directors of those companies ("the group proceeding"). The group members were defined as all persons who: at any time during the period between 6 February 2007 and 23 April 2009 (the relevant period) acquired and/or held an interest in a managed investment scheme of which [Timbercorp Securities] was the responsible entity (the schemes) (scheme member); suffered loss or damage by the conduct of the defendants alleged herein; and are not: defendants to the [group] proceeding; parents, siblings, spouses or children of defendants; (iii) bodies corporate of which a defendant was an officer or majority shareholder (defendant's company) at any time during the relevant period; or beneficiaries of any trust, the trustee of which is or at any time during the relevant period was a defendant or defendant's company". (emphasis in original) The respondents did not opt out of the group proceeding. Against the appellant, the lead plaintiff and each group member sought, amongst other things, damages, and orders declaring that the lead plaintiff and group members were not liable for fees or costs in connection with any of the schemes from February 2007, and that any loans entered into with the appellant in this period as a result of a breach of statutory duty be declared void or otherwise unenforceable. Consistent with Pt 4A of the Act, common questions of fact or law were identified. "Alleged Broadly, they were divided into two categories: non-disclosure in relation to financial structure and operations of Timbercorp Group" and "Duties and alleged breaches". The appellant filed a counterclaim against the lead plaintiff and his wife in the group proceeding, which included allegations about the terms of the particular loan agreement, the advance of funds and the defaults of the lead plaintiff and his wife. By way of defence to the counterclaim, the lead plaintiff and his wife denied they had any liability to repay any of the moneys allegedly advanced to them. Judd J ordered that the counterclaim be tried separately from the group proceeding, after the determination of the common questions in the group proceeding. That order was not the subject of appeal. It is important to recognise that the counterclaim was brought against the lead plaintiff and his wife personally and not in any representative capacity. It follows, of course, that there was no claim made in that counterclaim against any other group member. The group proceeding was dismissed by Judd J55. After delivering reasons for judgment, Judd J answered the common questions in accordance with his reasons. An appeal to the Court of Appeal of the Supreme Court of Victoria was dismissed56. 55 Woodcroft-Brown v Timbercorp Securities Ltd (2011) 253 FLR 240. 56 Woodcroft-Brown v Timbercorp Securities Ltd (in liq) (2013) 96 ACSR 307. The counterclaim and the defences raised in response to it remain unresolved. The recovery proceedings After the conclusion of the group proceeding, the appellant commenced separate proceedings against Mr and Mrs Collins and against Mr Tomes, in which the appellant alleges that they defaulted under their respective loan agreements. The appellant seeks recovery of outstanding principal and interest on the moneys it lent to them ("the recovery proceedings"). The respondents sought to defend the recovery proceedings on various bases. For Mr and Mrs Collins, those bases included that no loan had been advanced to them and that they did not acquire an interest in the 2008 project. For Mr Tomes, those bases included that it had been represented to him that, in the event of default under a loan agreement, the appellant's only recourse would be against his investment in the associated scheme. In the recovery proceedings, the appellant pleaded that the respondents were precluded from relying on those defences because (1) each was a group member in the group proceeding and was therefore subject to an Anshun estoppel; or (2) relying on those defences was an abuse of process. In substance, the appellant contended that those principles were engaged because the respondents had not opted out of the group proceeding and had not sought to have their individual claims "case managed" in the group proceeding. The question of whether the respondents were precluded from relying on those defences in the recovery proceedings was referred to Robson J for determination as a separate question under r 47.04 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic). Robson J concluded that the respondents were not precluded from relying on the defences they raised57. The Court of Appeal (Warren CJ, Santamaria and McLeish JJA) granted leave to the appellant to appeal against the orders of Robson J but dismissed the appeals58. Anshun estoppel and the issue Anshun estoppel is an extended form of "cause of action estoppel" and "issue estoppel" that "operates to preclude the assertion of a claim, or the raising of an issue of fact or law, if that claim or issue was so connected with the subject matter of the first proceeding as to have made it unreasonable in the context of 57 Timbercorp Finance Pty Ltd (in liq) v Collins [2015] VSC 461. 58 Timbercorp Finance Pty Ltd (in liq) v Collins [2016] VSCA 128. that first proceeding for the claim not to have been made or the issue not to have been raised in that proceeding"59. The first proceeding was the group proceeding. Was it "unreasonable", in the context of the group proceeding, commenced under Pt 4A of the Act, for the respondents to not have raised the issues they now seek to raise in the recovery proceedings? Once the provisions of Pt 4A of the Act are examined, it is clear that, in the circumstances of these cases, the answer must be "no". The appellant contends to the contrary in two different ways. First, the appellant contends that the group members are privies in interest of the lead plaintiff, including with respect to their individual claims, and that it was unreasonable for the lead plaintiff to not raise the issues in the group proceeding on behalf of the respondents. If the lead plaintiff, in his representative capacity, tried to raise the issues now, he would be estopped, and therefore the respondents should also be estopped. The second way is more direct – that it was unreasonable for the respondents themselves to have not either raised the issues in the context of the group proceeding, or opted out of that proceeding. Either way, put simply, the appellant's argument starts at the wrong point. The appellant examines the nature of the group proceeding and its connection with the recovery proceedings and only then, once that connection is supposedly established, does the appellant engage with the statutory scheme. That approach fails to recognise that the nature of the group proceeding is, at a fundamental level, shaped by Pt 4A of the Act and examination of the proceeding's nature, and any subsequent analysis, cannot be undertaken in isolation from that statutory scheme. Part 4A of the Act The appellant accepts that the statutory context is relevant to the question of unreasonableness. Indeed, its primary submission is that it is determinative of the inquiry. But the provisions of Pt 4A of the Act do not support the appellant's contentions; they are contrary to them. In Pt 4A of the Act, a "group proceeding" means a proceeding commenced under that Part60. A "plaintiff" is relevantly a "person who commences a group proceeding as a representative party", and a "group 59 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 89 ALJR 750 at 756-757 [22]; 323 ALR 1 at 7-8; [2015] HCA 28 (footnotes omitted). See also Anshun (1981) 147 CLR 589 at 598, 602-603. 60 s 33A of the Act. member" is a "member of a group of persons on whose behalf a group proceeding has been commenced"61 (emphasis added). Section 33C sets out the conditions that must be satisfied before a group proceeding may be commenced. First, there must be seven or more persons who have claims against the same person62. Second, the claims of all those persons must be "in respect of, or arise out of, the same, similar or related circumstances"63. And third, those claims must "give rise to a substantial common question of law or fact"64 (emphasis added). If those conditions are met, then s 33C(1) goes on to provide, importantly, that "a proceeding may be commenced by one or more of those persons as representing some or all of them". Put simply, the effect of those conditions is that the proceeding can only be representative to the extent of the commonality. Indeed, Pt 4A expressly contemplates and provides for the individuality of claims within a group proceeding. For example, a group proceeding may be commenced "whether or not the relief sought ... is the same for each person represented"65 and whether or not the proceeding "is concerned with separate contracts or individual group members"66, or "involves separate acts or omissions of the defendant done or omitted to be done in relation to individual group members"67. transactions between the defendant and These conditions in s 33C are central to the scheme set out in Pt 4A. The purpose of commencing a group proceeding is so that a substantial common question of law or fact can be decided for at least seven persons whose claims involve the same, similar or related circumstances. Section 33C expressly recognises that each group member may, as an individual, have different claims against the defendant, but the foundation of the group proceeding is that they all have an interest in the resolution of a substantial common question of law or fact. 61 s 33A of the Act. 62 s 33C(1)(a) of the Act. 63 s 33C(1)(b) of the Act. 64 s 33C(1)(c) of the Act. 65 s 33C(2)(a)(iv) of the Act. 66 s 33C(2)(b)(i) of the Act. 67 s 33C(2)(b)(ii) of the Act. That the focus of the group proceeding is on answering a common question of law or fact and is representative is reinforced by other provisions in Pt 4A. Section 33D(2) provides that if a person has commenced a proceeding on their own behalf as well as on behalf of other persons who satisfy s 33C(1), that person retains a sufficient interest to continue the proceeding (and bring an appeal from a judgment in that proceeding) "even though the person ceases to have a claim against the defendant". Section 33E provides that the consent of a person to be a group member is not required. What is required is that the essential elements stipulated in s 33C are satisfied and, if they are, then s 33H(2) of the Act requires that the following three connecting limbs be indorsed on the writ commencing the group proceeding – the group members; the specification of the nature of the claims made on behalf of the group members and the relief claimed; and, finally, the specification of the questions of law or fact common to the claims of the group members. These are not only the minimum requirements but also the outer limit of the connection between the group members. the description or identification of Group proceedings may not resolve all claims A judgment given in a group proceeding binds all group members who are described or otherwise identified in the judgment as being affected by the judgment68. But that judgment will not necessarily resolve all of the individual claims of each group member. In addition to s 33C, other provisions in Pt 4A recognise that there may be differences between the circumstances of individual group members and that, as a consequence, a group proceeding may not resolve all of the individual claims of each group member. Section 33Q – titled "Where not all questions common" – addresses the situation where the determination of the common questions "will not finally determine the claims of all group members". In that situation, "the Court may give directions in relation to the determination of the remaining questions" (emphasis added). Practically, depending on whether and how the court exercises the power, the group proceeding may proceed to judgment in relation to some or all of the common questions, but the claims of group members beyond the scope of those questions may remain undetermined69. Further, s 33S provides that if a question cannot properly or conveniently be dealt with within the group proceeding, the court "may give directions for the commencement and conduct of another proceeding, whether or not a group 68 s 33ZB of the Act. 69 See also s 33ZE(2) of the Act. proceeding" (emphasis added). that another proceeding may be commenced that has some connection with claims raised in the group proceeding. This provision recognises Respondents' conduct not unreasonable It is within that statutory context that the question of unreasonableness for the purposes of Anshun estoppel falls to be considered. Whether an Anshun estoppel arises depends on the particular circumstances of the case70. Although it was put in the alternative to the privies contention during oral argument, it is convenient first to deal with the contention that it was unreasonable for the respondents themselves not to raise the issues in the group proceeding, or opt out of that proceeding. The underlying premise of that contention is that, if a group member does not either opt out of a group proceeding or seek directions in relation to their individual claim, then it will automatically be "unreasonable in the context of that first proceeding" for them not to have done so, such that an Anshun estoppel will arise. That premise is wrong. It cannot account for the particular circumstances of each case and instead urges a mechanical approach to the application of Anshun estoppel in group proceedings71. Relevant circumstances in these cases include the scope of the group proceeding as determined by the definition of the group members and the common questions; the role of group members in a group proceeding; the counterclaim and its management; and the nature of the opt out procedure. None of those circumstances is determinative, but all of them point away from an Anshun estoppel arising against the respondents. Scope of the group proceeding One important circumstance that may weigh in favour of an Anshun estoppel arising is whether raising an issue in the second proceeding (here, the recovery proceedings) would create a risk of there being inconsistent judgments on that issue. In the courts below, the appellant did not contend that there was such a risk. 70 See Anshun (1981) 147 CLR 589 at 603; Gibbs v Kinna [1999] 2 VR 19 at 26-27 71 cf Champerslife Pty Ltd v Manojlovski (2010) 75 NSWLR 245 at 247 [3]-[4], 255 The appellant's position changed in this Court. However, that change was misguided. It was based on a misunderstanding of the scope of the group proceeding. Central to both of the appellant's contentions regarding Anshun estoppel was the supposed closeness of the connection between the group proceeding and the relevant recovery proceeding, as identified by reference to the "factual matrix" that generated the controversy underlying the group proceeding. The appellant submitted that the factual matrix included the making of loans from the appellant to the lead plaintiff and group members to fund their investments in schemes managed by Timbercorp Securities, and the use of those funds by Timbercorp Securities and the appellant in the operations of the Timbercorp Group. That submission pays insufficient attention to the definition of the group members for the purpose of the group proceeding. Broadly speaking, that definition extended to those persons who acquired or held an interest in the relevant schemes during a particular period of time and incurred a liability for management fees as a scheme member. Critically, those persons may or may not have also had loan agreements with the appellant in relation to their investment in the schemes. But that fact is irrelevant to whether they were group members. It is therefore unsurprising that the common questions in the group proceeding did not raise any issues about the validity or enforceability of the loans arising out of the lending process or the advancement of moneys under the loans. Rather, as Robson J noted, the loan agreements were challenged "merely as a consequence of the investor entering into the schemes and, in particular, being induced to do so allegedly as a result of misleading information or of the investors not being properly informed"72. For the same reason, it is also wrong to suggest, as the appellant did in relation to Mr Tomes, that the making of a loan agreement with the appellant was a premise upon which the group proceeding was founded, and integral to its factual matrix. Also in relation to Mr Tomes, the appellant submitted that the factual matrix included what was said or not said in product disclosure statements as to risks confronting the schemes and the way in which funds would be deployed. However, there is a distinction between representations made personally to individuals such as Mr Tomes and those representations made in the product disclosure statements. That distinction is glossed over by the appellant. But the distinction is important, as it goes to the substance of what was in issue in the group proceeding. Critically, the "case was confined to defects in the Product 72 Timbercorp Finance Pty Ltd (in liq) v Collins [2015] VSC 461 at [6]. Disclosure Statements and whether they omitted information or contained misleading information"73. By ignoring the essential details of the scope of the group proceeding, the appellant masks the true scope of that proceeding and makes it appear to be much wider than it was in fact. This, in turn, distorts the unreasonableness analysis undertaken by the appellant. In this context, it must be recalled that a group proceeding may be commenced whether or not the proceeding involves separate acts or omissions of the defendant done or omitted to be done in relation to individual group members74. The group proceeding is only representative to the extent of the commonality75. truth, these matters point away from the existence of any unreasonableness on the part of the respondents. They go to the heart of the scope of the group proceeding, as defined by reference to s 33C. It may be accepted that the respondents' claims are in respect of, or arise out of, similar or related circumstances. But as explained above, the Act does not envisage that all of those claims will be resolved by answering the common questions. Rather, s 33C acknowledges that the answers to the common questions might assist in the resolution of other claims of group members in later proceedings. No active role for respondents in group proceeding There is no basis to say that a group member must avail themselves of the case management powers under s 33Q or s 33S to litigate any individual claims. The appellant submits that those powers are there to be used, and it is unreasonable not to have done so because they are express statutory safeguards against the preclusionary implications of a judgment in the group proceeding. That submission mischaracterises the nature of those powers and their role in the statutory scheme. The first observation is that, as noted above, the consent of a person to be a group member is not required76. A person may become a group member simply because they match the description of group members included on the indorsement on the writ that commenced the group proceeding. In some circumstances77, group members may remain "perfectly ignorant of the 73 Timbercorp Finance Pty Ltd (in liq) v Collins [2015] VSC 461 at [7]. 74 s 33C(2)(b)(ii) of the Act. 75 See [102]-[110] above. 76 s 33E of the Act. 77 See ss 33X(2) and 33Y(4) of the Act. proceedings, and of what is really going on"78. That a group member's consent is not needed is reflected in s 33ZD, which provides that, except in limited circumstances, only the lead plaintiff or the defendant to the group proceeding may be ordered to pay costs. There are few provisions in Pt 4A that contemplate an active role for, or give control to, group members in a group proceeding. Section 33T is one of them. Section 33T(1) provides that if, "on an application by a group member, it appears to the Court that the plaintiff is not able adequately to represent the interests of the group members, the Court may substitute another group member as plaintiff and may make such other orders as it thinks fit" (emphasis added). It contemplates a group member making an application in the context of a group proceeding79. Words to that effect are conspicuously absent from ss 33Q and Section 33Q is enlivened based on what "appears to the Court". Here, it is also worth noting s 33R(1). Under that provision, in giving directions under s 33Q, the "Court may permit an individual group member to take part in the proceeding for the purpose of determining a question that relates only to the claim of that member"80. Section 33R clearly contemplates a role for a group member in a group proceeding in some circumstances. But s 33R supplements s 33Q, which makes no mention of an application being made by a group member. Similarly, s 33S contemplates the court making a judgment about whether a question can be determined "properly or conveniently". None of the above should be taken to suggest that the Act prevents a group member from seeking directions; rather, the simple point is that the Act does not oblige a group member to seek directions in relation to each and every issue that relates to their specific claim, nor is there any indication that the Act expects them to do so. Section 33T and like provisions can also be contrasted against other provisions in Pt 4A, which explicitly contemplate applications being made, 78 Powell v Wright (1844) 7 Beav 444 at 446-447 [49 ER 1137 at 1138] quoted in Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 31 [39]; [2002] HCA 27. 79 See also ss 33J(3), (6) and 33W(3) of the Act. 80 See also ss 33ZC(4) and 33ZD(b) of the Act. variously, by the lead plaintiff, the defendant, or a party to the group proceeding81. The appellant challenges the Court of Appeal's conclusion that the group members "had no control over the conduct by the [lead] plaintiff of the group proceeding"82. But that conclusion was correct: except in limited circumstances, the statutory scheme does not contemplate group members having an active role in, or control over, the conduct by the lead plaintiff of a group proceeding. Having no active role in, or control over, the conduct by the lead plaintiff of a group proceeding is distinct from what Gaudron, Gummow and Hayne JJ were referring to in Mobil Oil Australia Pty Ltd v Victoria when their Honours explained that it was inaccurate to say that group members have no control "over their part in the proceeding"83. A group member does have control over their part in a group proceeding; if they do not wish to be a part of it, they can opt out in accordance with s 33J. A group proceeding under Pt 4A is conducted by the lead plaintiff on behalf of the group members. Aside from the few limited exceptions considered above, Pt 4A is not designed to encourage active participation by group members in the course of a group proceeding. It is therefore difficult to accept the contention that the respondents' failure to take an active role points in favour of their conduct being unreasonable. Counterclaim and its management The counterclaim was addressed earlier in these reasons. It was brought against the lead plaintiff and his wife personally, and not in any representative capacity, and there was no claim made against any other group member within the group proceeding. Its existence and the manner in which Judd J managed it was and remains important. It suggests that Judd J was inclined to exercise the discretions conferred on him by ss 33Q and 33S in a manner that would have resulted in the position of the parties being similar to, if not the same as, what it is now. That is, the individual claims would have been left to be resolved after the resolution of the common questions. That approach accords with modern practice84. To the extent that the exercise of the court's discretion feeds into the 81 See, eg, ss 33K(1), 33KA(1), 33M(b), 33N(1), 33ZA(5), 33ZF, 33ZJ(1) of the Act. 82 See Timbercorp Finance Pty Ltd (in liq) v Collins [2016] VSCA 128 at [213]. 83 (2002) 211 CLR 1 at 34 [50]. 84 See Kelly v Willmott Forests Ltd (in liq) (No 4) (2016) 112 ACSR 584 at 629 [214] citing Bright v Femcare Ltd (2002) 195 ALR 574 at 580 [18]. See also Merck Sharp & Dohme (Australia) Pty Ltd v Peterson [2009] FCAFC 26 at [7]. unreasonableness analysis85, the above facts point away from any conclusion that the respondents' conduct in not raising the issues in the group proceeding was unreasonable. Similarly, while s 33Q(2) contemplates that directions may be given to establish a "sub-group" consisting of those group members who have questions common to them but not to all of the group members, there is no requirement that a sub-group be established. Significantly, the question of sub-groups was the subject of a ruling made by Judd J on 30 July 2010. After recording the appellant's contention that the group proceeding was defensive in nature, as it was an attempt by group members indebted to the appellant to resist payment of outstanding loans, the ruling records that the appellant unsuccessfully sought the establishment of four sub-groups so that any trial would effectively dispose of most, if not all, issues. The orders made in consequence of that ruling were not the subject of appeal. Again, this points away from a conclusion that the respondents' conduct was unreasonable. Opt out procedure Section 33J of the Act provides that a group member may opt out of the group proceeding by notice in writing, so long as they do so before the date fixed by the court before which a group member may opt out. The appellant's reliance on the right of a group member to opt out of a group proceeding is misplaced. A group member may wish to remain in a group proceeding to obtain the benefit of a judgment that resolves the common question or questions in issue. There is nothing in the express terms of s 33J or inherent in the opt out procedure that suggests that, by not opting out, a group member is signing away their ability to bring any proceedings that are in some way connected to the group proceeding. As the Court of Appeal recognised, if the appellant's understanding of the opt out provisions were correct, the effect would be to "homogenise" all claims of all group members involved in a group proceeding86. Not only would that consequence be dramatic, it would also be expressly at odds with ss 33C(2)(b), 33Q and 33S. As with each of the other circumstances identified, this circumstance points away from the respondents' conduct being unreasonable. The appellant's contention that it was unreasonable for the respondents themselves not to raise the issues in the group proceeding, or opt out of that proceeding, must therefore fail. 85 See Ling v Commonwealth (1996) 68 FCR 180 at 193-194; Meriton Apartments Pty Ltd v Industrial Court (NSW) (2009) 263 ALR 556 at 558 [4], 567 [78]. 86 Timbercorp Finance Pty Ltd (in liq) v Collins [2016] VSCA 128 at [185]. Privies The appellant's contention that group members are privies in interest of the lead plaintiff in a group proceeding does not assist the appellant's case. The crux of this contention was that the lead plaintiff should have himself raised the relevant issues in the group proceeding on behalf of the respondents. In Tomlinson v Ramsey Food Processing Pty Ltd, French CJ, Bell, Gageler and Keane JJ recognised that Anshun estoppel "has the potential to preclude ... the raising of an issue of fact or law, between parties to a proceeding or their privies"87 and that "representation by a representative party in a modern class action" is a form of representation that binds those represented to estoppels88, including Anshun estoppel. As a general proposition that is correct. The question is: to what extent are the legal interests of a group member represented by the lead plaintiff? And that again requires close consideration of the statutory scheme. As outlined above, under Pt 4A group proceedings are a procedure that may be used to resolve a "substantial common question of law or fact". A lead plaintiff commences such a proceeding "on behalf of" group members so that the substantial common question or questions can be resolved. However, the legal interests of a group member and the lead plaintiff only align to the extent that each has an interest in the resolution of the common question or questions. Once that is understood, it is apparent that the appellant's contention that the respondents should be precluded from raising the issues because the lead plaintiff would be so precluded is misconceived. It is contrary to the statutory scheme and, in particular, impermissibly seeks to go beyond the outer limit of the connection between the group members created by s 33C for the purposes of the group proceeding. It assumes, wrongly, that the group members are privies in interest of the lead plaintiff for all purposes, including in relation to their individual claims. That is not the case. The effect of the statutory scheme is that the respondents "did not have an opportunity to exercise control over the presentation of evidence and the making of arguments in the earlier proceeding" and, due to the nature and scope of the group proceeding, the lead plaintiff could not have been expected to take into account the possibility that an Anshun estoppel may arise in a later proceeding to 87 (2015) 89 ALJR 750 at 757 [23]; 323 ALR 1 at 8. 88 (2015) 89 ALJR 750 at 760-761 [40]; 323 ALR 1 at 12 citing Zhang v Minister for Immigration, Local Government and Ethnic Affairs (1993) 45 FCR 384 at 399-406. the detriment of the respondents in relation to their individual claims89. It would be "quite unjust" for an Anshun estoppel to arise in those circumstances90. Accordingly, the appellant's contention based on the premise that the group members are privies in interest of the lead plaintiff must fail. Abuse of process The appellant's abuse of process claim fails for similar reasons. The raising of the defences cannot be described as an abuse of process because there is nothing in either the statutory scheme or the nature of the group proceeding that suggests the respondents should have raised their individual claims in the context of the group proceeding. To the contrary, Pt 4A recognises that individual claims may need to be resolved in separate proceedings. In the present circumstances, raising the defences in separate proceedings is not an abuse of process. Orders Each appeal should be dismissed with costs. 89 Tomlinson (2015) 89 ALJR 750 at 760 [39]; 323 ALR 1 at 12. 90 See Tomlinson (2015) 89 ALJR 750 at 760 [39]; 323 ALR 1 at 12.
HIGH COURT OF AUSTRALIA IN THE MATTER OF QUESTIONS REFERRED TO THE COURT OF DISPUTED RETURNS PURSUANT TO SECTION 376 OF THE COMMONWEALTH ELECTORAL ACT 1918 (CTH) CONCERNING MS JACQUI LAMBIE Re Lambie [2018] HCA 6 Date of Order: 6 February 2018 Date of Publication of Reasons: 14 March 2018 ORDER The question reserved for the consideration of the Full Court under s 18 of the Judiciary Act 1903 (Cth) be answered as follows: Question Is Mr Martin incapable of being chosen or of sitting as a senator by reason of s 44(iv) of the Constitution? Answer No, Mr Martin is not incapable of being chosen or of sitting as a senator by reason of s 44(iv) of the Constitution. Representation C R C Newlinds SC with P Kulevski appearing on behalf of Ms McCulloch (instructed by Holman Webb Lawyers) P H Solomon QC with C O H Parkinson appearing on behalf of Mr Martin (instructed by Corrs Chambers Westgarth) S P Donaghue QC, Solicitor-General of the Commonwealth with Z E Maud and B K Lim appearing on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) No appearance for Ms Lambie K L Walker QC, Solicitor-General for the State of Victoria with M Hosking appearing on behalf of the Attorney-General for the State of Victoria, intervening (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Re Lambie Constitutional law (Cth) – Parliamentary elections – Reference to Court of Disputed Returns – Where Court held there was a vacancy in representation of Tasmania in Senate – Where Court made directions for special count of ballot papers to fill vacancy – Where orders sought following special count that Mr Steven Martin be declared elected as senator to fill vacancy – Where Mr Martin held offices of mayor and of councillor of local government corporation under Local Government Act 1993 (Tas) – Whether Mr Martin incapable of being chosen or of sitting as senator by reason of s 44(iv) of Constitution – Proper construction of s 44(iv) of Constitution – Where no dispute that office of mayor or of councillor is "office of profit" – Whether office of mayor or of councillor constitutes office of profit "under the Crown". Words and phrases – "civil service", "conflict between duties", "conflict of duty and interest", "control over holding or profiting from holding", "employment by the Crown", "employment in the public service", "executive government", "executive influence", "from the Crown", "incapable of being chosen or of sitting", "office of profit", "public service", "under the Crown", "will of the executive government". Constitution, ss 44(iv), 45(i), 48. Commonwealth Electoral Act 1918 (Cth), s 376. Local Government Act 1993 (Tas). KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE AND GORDON JJ. On 14 November 2017, the Senate resolved to refer questions to the High Court sitting as the Court of Disputed Returns pursuant to s 376 of the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act"). The questions referred included whether, by reason of s 44(i) of the Constitution, there is a vacancy in the representation of Tasmania in the Senate for the place for which Ms Jacqui Lambie was returned at the double dissolution election held on 2 July 2016 and, if so, by what means and in what manner that vacancy should be filled. On 8 December 2017, after making orders allowing the Attorney-General of the Commonwealth, Mr Steven Martin and Ms Katrina McCulloch to be heard on the reference, as a consequence of which each was deemed to be a party to the reference by operation of s 378 of the Electoral Act, Nettle J answered those questions to the effect that there is such a vacancy in the representation of Tasmania in the Senate which should be filled by a special count of the ballot papers in accordance with orders which his Honour then made. On 12 December 2017, the Australian Electoral Officer for Tasmania conducted a special count in accordance with the orders which had been made by Nettle J and reported on the candidates who would be elected as senators for Tasmania as a result of that special count. Those candidates included Mr Martin, who had not previously been returned as a senator. Mr Martin holds and for current terms which commenced in 2014 has held the offices of mayor and of councillor of Devonport City Council, a local government corporation established under the Local Government Act 1993 (Tas) ("the Local Government Act"). In respect of each of those offices, Mr Martin has and throughout its current term has had a statutory entitlement to be paid a substantial annual allowance by the Council. On 13 December 2017, pursuant to s 18 of the Judiciary Act 1903 (Cth), Nettle J stated for the consideration of the Full Court the question of whether Mr Martin is incapable of being chosen or of sitting as a senator by reason of s 44(iv) of the Constitution. On 6 February 2018, at the conclusion of the hearing of the question so stated, the Full Court answered that question in the negative. These are our reasons for that answer. Section 44(iv) of the Constitution and earlier authority To the extent immediately relevant, s 44 of the Constitution provides: "Any person who: Bell Nettle Gordon holds any office of profit under the Crown, or any pension payable during the pleasure of the Crown out of any of the revenues of the Commonwealth; … shall be incapable of being chosen or of sitting as a senator or a member of the House of Representatives. But subsection (iv) does not apply to the office of any of the Queen's Ministers of State for the Commonwealth, or of any of the Queen's Ministers for a State, or to the receipt of pay, half pay, or a pension, by any person as an officer or member of the Queen's navy or army, or to the receipt of pay as an officer or member of the naval or military forces of the Commonwealth by any person whose services are not wholly employed by the Commonwealth." Important to the context in which s 44(iv) is to be construed is s 45(i), which provides: "If a senator or member of the House of Representatives: becomes subject to any of the disabilities mentioned in the last preceding section; … his place shall thereupon become vacant." The temporal relationship between s 44 and s 45(i) was recently explained in Re Nash (No 2)1. The process of "being chosen" to which s 44 refers is a process of electoral choice which begins with nomination for election and which remains incomplete unless and until a candidate who is not subject to a disability mentioned in s 44 at any time during that process is validly returned as elected. The "senator or member" to whom s 45 refers is a qualified candidate who has been validly returned as elected. If a qualified candidate once having been returned as elected thereafter becomes subject to a disability mentioned in s 44, (2017) 92 ALJR 23; 350 ALR 204; [2017] HCA 52. Bell Nettle Gordon "not only does s 44 operate to prevent the person from sitting but s 45(i) operates to vacate his or her place"2. The ambit of the disability mentioned in s 44(iv) has been considered by the High Court sitting as the Court of Disputed Returns in two previous cases. The first was Sykes v Cleary3, where s 44(iv) was held to apply to Mr Cleary by reason of him holding an appointment as "a permanent officer in the teaching service" under the Teaching Service Act 1981 (Vic)4. The second was Re Nash (No 2), where the Court noted in passing that "[t]here could be, and was, no dispute" that Ms Hughes had held an "office of profit under the Crown" within the meaning of s 44(iv) during the period between the commencement of her appointment to and her resignation from the position of a part-time member of the Administrative Appeals Tribunal under the Administrative Appeals Tribunal Act 1975 (Cth)5. Consistently with the reasoning in Sykes v Cleary6, there was no dispute in the present case that the reference in s 44(iv) to "the Crown" is to executive government and that the reference encompasses the executive government of a State as well as the executive government of the Commonwealth. There was also no dispute that the offices of mayor and of councillor of a local government corporation established under the Local Government Act each answer the description of an "office of profit" within the meaning of s 44(iv): each is a position of a public character constituted under governmental authority to which duties and emoluments are attached7. (2017) 92 ALJR 23 at 29 [33]; 350 ALR 204 at 212. (1992) 176 CLR 77; [1992] HCA 60. (1992) 176 CLR 77 at 97. (2017) 92 ALJR 23 at 26 [9]; 350 ALR 204 at 207. (1992) 176 CLR 77 at 95-98, 108, 130, 132. Cf Sue v Hill (1999) 199 CLR 462 at 499 [87]; [1999] HCA 30. 7 Cf Sykes v Cleary (1992) 176 CLR 77 at 95; R v Boston (1923) 33 CLR 386 at 402; [1923] HCA 59. Bell Nettle Gordon Issues and parties' submissions The sole issue for determination by the Full Court in answering the question reserved was whether, within the meaning of s 44(iv), the offices of mayor and of councillor of a local government corporation established under the Local Government Act answer the description of offices of profit "under" the executive government of Tasmania. The parties were agreed that determination of the existence or non- existence of the relationship between a statutory office and executive government connoted by the word "under" turned solely on an examination of the statutory incidents of the office. They were not agreed on what that relationship entailed and what factors would indicate its existence. For Ms McCulloch it was argued that the relationship connoted by the word "under" was one merely of subordination of the office to an executive government; the factors that might indicate the existence of such a relationship were argued to be many and varied. For the Attorney-General of the Commonwealth, it was argued that the relationship was rather one of dependence for the holding or continued holding of the office on the will or continuing will of an executive government; the factors that might indicate the existence of such a relationship were argued to be closely circumscribed. The arguments for Mr Martin, and for the Attorney-General for the State of Victoria, who intervened at the hearing under s 78A of the Judiciary Act, supported the making of a multi-factorial evaluative determination somewhere along a spectrum bounded by those two positions. Construction of s 44(iv) Pre-federation history The language of s 44(iv) can be traced back through the same or similar language in colonial constitutions8, to provisions of the Succession to the Crown 8 Section 27 of the Constitutional Act 1854 (Tas) (18 Vict No 17); ss 18 and 19 of Sched 1 to the New South Wales Constitution Act 1855 (Imp) (18 & 19 Vict c 54); s 17 of Sched 1 to the Victoria Constitution Act 1855 (Imp) (18 & 19 Vict c 55); s 17 of the Constitution Act 1855-6 (SA); s 20 of the Constitution Act 1867 (Q) (31 Vict No 38); ss 6 and 29(5) of Sched 1 to the Western Australia Constitution Act 1890 (Imp) (53 & 54 Vict c 26). Bell Nettle Gordon Act 17079 and Statute 4 & 5 Anne c 20 (1705)10, and ultimately to a provision of the Act of Settlement 170111. Textually, the most that can for present purposes be drawn from that context is the emergence of a general understanding over the centuries that offices of profit "under" the Crown was a wider category than offices of profit "from" the Crown, the latter being generally understood to be confined to offices the appointment to which was made directly by the Crown and not through the medium of a Minister12. There is a passing observation in the edition of Rogers on Elections current at the time of federation to the effect that the words "under the Crown" "seem to apply to all offices connected with the public service"13. Nothing of present utility can legitimately be taken from it. The observation was tentative and descriptive as distinct from definitional. The edition of Erskine May's well-known treatise on parliamentary practice current at the time of federation referred to a hodgepodge of peculiarly English offices then treated as a matter of parliamentary practice as disqualifying their holders from membership of the House of Commons14. There is no profit in cataloguing them. They do not disclose any principled basis for determining when an office would or would not be considered an office of profit under the Crown. The expression "under" the context of disqualification for election to the position of member of a Divisional Board the Crown appearing 9 6 Anne c 41, ss 24 and 25. 10 Sections 29 and 30. 11 12 & 13 Will III c 2, s 3. See Sykes v Cleary (1992) 176 CLR 77 at 95. 12 See Day, Rogers on Elections, 17th ed (1895), vol 2 at 10, 44; United Kingdom, House of Commons, Report from the Select Committee on Offices or Places of Cf Clydesdale v Hughes Profit under the Crown, (1941) at xiii [17]. (1934) 36 WALR 73 at 85. 13 Day, Rogers on Elections, 17th ed (1895), vol 2 at 10, 44. 14 Erskine May, A Treatise on the Law, Privileges, Proceedings and Usage of Parliament, 10th ed (1893) at 28-29, 603-608. Bell Nettle Gordon under the Divisional Boards Act 1887 (Q)15 was interpreted by the Supreme Court of Queensland in 1889 to disqualify a person who had been appointed as a poundkeeper on the basis that "his appointment and removal depend on the judgment of ... officers of the Crown"16. The expression "under" the Crown appearing in the context of parliamentary disqualification, however, has until now lacked judicial exposition17. Nothing in pre-federation history suggests that the expression "under" the Crown appearing in the context of parliamentary disqualification had acquired a technical meaning by the time of federation. Moreover, nothing in the drafting history of s 44(iv)18 suggests that any significance was ascribed by the framers of the Constitution to the precise choice of language. The issue now for determination cannot be resolved by discovering the historical connotation of a preposition. Pre-federation history is more enlightening as to the purpose of the disqualification. By the end of the nineteenth century, the disqualification of a member of the House of Commons who held an office of profit under the Crown was but one of a long list of disqualifications for parliamentary office which had by then come to be imposed by statute19. Writing the numerous in 1886, Sir William Anson described disqualifications as falling into two groups. The first group comprised disqualifications "created during the greater part of the [eighteenth] century [that] were designed to secure the independence of Parliament". The second group comprised "more modern disqualifications ... for the most part imposed to secure 15 51 Vict No 7. 16 Hodel v Cruckshank (1889) 3 QLJ 141 at 142. 17 Carney, Members of Parliament: Law and Ethics, (2000) at 64. 18 See Official Report of the National Australasian Convention Debates, (Sydney), 18 March 1891 at 471-472, 3 April 1891 at 660-661; Official Report of the National Australasian Convention Debates, (Adelaide), 17 April 1897 at 739-745; Official Record of the Debates of the Australasian Federal Convention, (Melbourne), 16 March 1898 at 2448. 19 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 85-87. Bell Nettle Gordon the undivided attention of officials to the business of their departments, and the advantage of a permanent civil service unaffected by changes of ministry or by considerations of party politics"20. Disqualification by reason of holding an office of profit under the Crown fell within Sir William's first group of disqualifications. In relation to that first "The amount of influence accruing to the Crown from the places which were thus abolished, or made to disqualify, may be collected from Burke's speech on Economical Reform, made with a view to the passing of the last of the Acts I have mentioned. It is not difficult to see the use to which such places were put when the reform of the king's household was thwarted because 'the turnspit in the king's kitchen was a member of Parliament'; when the Board of Trade could be described as 'a sort of temperate bed of influence: a sort of gently ripening hot-house where eight members of Parliament receive salaries of a thousand a year, for a certain given time, in order to mature, at a proper season, a claim to two thousand granted for doing less, and on the credit of having toiled so long in that inferior laborious department.'" Writing also in 1886, in Melbourne, Professor Hearn explained how the continuing disqualification of a member of the House of Commons who held an office of profit under the Crown had contributed in practice to the emergence of a permanent non-political public service and went on to explain by reference to conflicting duties of office how "a seat in Parliament and a permanent official position are irreconcilable"22. Consistently with Sir William Anson, however, Professor Hearn stated23: 20 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 290-291. See also Maitland, The Constitutional History of England, (1955) at 368-369. 21 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 291. 22 Hearn, The Government of England: Its Structure and Its Development, 2nd ed 23 Hearn, The Government of England: Its Structure and Its Development, 2nd ed Bell Nettle Gordon "The laws which now regulate the capacity or incapacity of officers of the Crown to serve in Parliament did not originally contemplate the results which I have attempted to describe. The great aim of our legislation on this subject has been the limitation of Royal influence in Parliament." The purpose to which s 44(iv) is directed Bearing on the resolution of the issue for determination is the combination of two overarching considerations. One is the precept, endorsed in Re Canavan24 in relation to s 44(i) and applicable equally to s 44(iv), that the provision's "limiting effect on democratic participation tells in favour of an interpretation which gives the disqualification set out ... the greatest certainty of operation that is consistent with its language and purpose"25. The other is the identification in Sykes v Cleary, consistently with the writings of Sir William Anson and Professor Hearn, of the "principal mischief" to which s 44(iv) is directed in terms of "eliminating or reducing ... executive influence over the House"26. More significant still is the function attributable to s 44(iv), conformably with that identified purpose, in protecting the framework for responsible government established primarily through the operation of ss 7, 24, 61 and 64 of the Constitution. The capacity for the Houses of Parliament to act as a check on executive action is essential to responsible government. The corresponding duty of a member of Parliament was spelt out by Isaacs J in Horne v Barber27: "When a man becomes a member of Parliament, he undertakes high public duties. Those duties are inseparable from the position: he cannot 24 (2017) 91 ALJR 1209 at 1219 [48]; 349 ALR 534 at 546; [2017] HCA 45. 25 Re Day (No 2) (2017) 91 ALJR 518 at 535 [97]; 343 ALR 181 at 201; [2017] HCA 14. See also 91 ALJR 518 at 535 [98], [100], 542 [156], 556 [263]; 343 ALR 181 at 201-202, 212, 230-231. 26 (1992) 176 CLR 77 at 97. 27 (1920) 27 CLR 494 at 500; [1920] HCA 33. See also R v Boston (1923) 33 CLR 386 at 401-402. Bell Nettle Gordon retain the honour and divest himself of the duties. One of the duties is that of watching on behalf of the general community the conduct of the Executive, of criticizing it, and, if necessary, of calling it to account in the constitutional way by censure from his place in Parliament – censure which, if sufficiently supported, means removal from office. That is the whole essence of responsible government, which is the keystone of our political system, and is the main constitutional safeguard the community possesses. The effective discharge of that duty is necessarily left to the member's conscience and the judgment of his electors, but the law will not sanction or support the creation of any position of a member of Parliament where his own personal interest may lead him to act prejudicially to the public interest by weakening (to say the least of it) his sense of obligation of due watchfulness, criticism, and censure of the Administration." The word "under" in s 44(iv) obviously must connote the same connection between a senator or member and the executive government of a State as it connotes between a senator or member and the executive government of the Commonwealth. What must nevertheless be emphasised is that s 44(iv) is at its apogee, in conjunction with s 45(i), in protecting the framework for responsible government established by the Constitution in so far as it operates to limit the capacity of the Commonwealth executive to influence a sitting senator or member in the performance of his or her parliamentary duty by the grant of an office of profit. It is impossible to resist the conclusion that "[a]t the very least, s 44(iv) was intended to prevent any revival of the practice (forbidden in Great Britain by the Act of Settlement of 1701) of the executive government suborning votes in the Houses of Parliament through purchase – that is through the grant of offices of profit under the Crown"28. The competing interpretations of the word "under" are appropriately evaluated by considering how they would operate to achieve that purpose. The plurality in Sykes v Cleary noted that s 44(iv)'s disqualification for holding an office of profit under the Crown had been accepted in Australia to exclude "public servants, who are officers of the departments of government, 28 Hanks, "Parliamentarians and the Electorate", in Evans (ed), Labor and the Constitution 1972-1975, (1977) 166 at 192 (footnote omitted). Bell Nettle Gordon from membership of the legislature"29 and stated that the disqualification had in that way "played an important part in the development of the old tradition of a politically neutral public service"30. Consistently with the observations of Professor Hearn concerning the pre-federation position in the United Kingdom, the plurality referred to that exclusion of "permanent officers of the executive government" as "a recognition of the incompatibility of a person at the one time holding such an office and being a member of the House" and identified as one of the factors giving rise to that incompatibility that "performance by a public servant of his or her public service duties would impair his or her capacity to attend to the duties of a member of the House"31. Plainly, however, s 44(iv) is not designed to eliminate a conflict merely between the duty which a person might have as the holder of an office and the duty which that person would assume as a senator or member of the House of Representatives. Were that its design, the confining of its relevant operation to an office of profit and the carving out from its operation of State Ministers would make no sense. To the extent s 44(iv) has the effect of eliminating such a conflict between duties, the operation of the provision has been consequential but serendipitous. Rather, s 44(iv) can be seen to be quite narrowly tailored to eliminate a particular form of conflict of duty and interest. The targeted conflict is between the parliamentary duty of a senator or member and a pecuniary interest of a kind which, if permitted, would give rise to a real capacity for executive influence over the performance of that duty. The particular form of conflict to which the first clause of the provision is addressed is that which would arise from a senator or member being able to hold at the will of an executive government an office in respect of which he or she receives a financial gain. Concern to eliminate a similar conflict between parliamentary duty and pecuniary interest is evident in the disqualification by the second clause of s 44(iv) of a person who holds a pension payable during the pleasure of the 29 (1992) 176 CLR 77 at 95, citing Australia, Joint Standing Committee on Electoral Matters, Inquiry into the Conduct of the 1987 Federal Election and 1988 Referendums, Report No 3, (May 1989) at 28 [3.53]. 30 (1992) 176 CLR 77 at 95-96. 31 (1992) 176 CLR 77 at 96. Bell Nettle Gordon Crown out of any of the revenues of the Commonwealth. Commenting on an early draft of that second clause in the course of debate at the National Australasian Convention in 1891, in language that can fairly be treated as applicable to what was to become s 44(iv) in its entirety, Sir Samuel Griffith summed up its object as being "to prevent persons who are dependent for their livelihood upon the government, and who are amenable to its influence, from being members of the legislature"32. Within that relatively narrow yet important compass, s 44(iv) in combination with s 45(i) has a prophylactic quality. Not only does s 44(iv) operate to prevent a person who holds at the will of executive government an office in respect of which he or she receives a financial gain from being chosen as a senator or member, but s 44(iv) and s 45(i) operate together to limit the capacity for a person who has been chosen as a senator or member to be influenced by the prospect of obtaining any present or future financial gain at the will of the executive during the period in which the person serves as a senator or member. The provisions can be seen to combine in that way to complement the operation of s 48 of the Constitution, which made provision for a specified pecuniary allowance to be paid to each senator and each member until the Parliament otherwise provided, and by reference to which the comment was made in Brown v West that "[t]here is much to be said for the view that the Parliament alone may make provision for benefits having a pecuniary value which accrue to its members in virtue of their office and which are not mere facilities for the functioning of the Parliament"33. Interpretation of office of profit "under" the Crown The disqualification set out in the first clause of s 44(iv) is given the greatest certainty of operation that is consistent with its language and with its purpose of eliminating or reducing the executive influence over a senator or member which would arise from a relationship of financial dependency by adopting an interpretation of the word "under" which substantially accords with that proposed by the Attorney-General of the Commonwealth. An office of profit is "under" the Crown within the meaning of the provision if the holding or 32 Official Report of the National Australasian Convention Debates, (Sydney), 3 April 1891 at 660. 33 (1990) 169 CLR 195 at 201; [1990] HCA 7. Bell Nettle Gordon continued holding of that office, or the receipt of profit from it, depends on the will or continuing will of the executive government of the Commonwealth or of a State. The disqualification effected by the provision as so interpreted can be seen to have two distinct aspects. First, the provision operates to disqualify any person who holds any office of profit to which that person has been appointed at the will of the executive government of the Commonwealth or of a State. The security of the person's tenure in such an office and the mechanism by which the person might be removed from such an office are irrelevant to that aspect of the provision's operation: a sinecure to which a person might be appointed at the will of an executive government as an inducement is no less attractive because it is secure. Mere appointment to an office of profit at the will of an executive government of itself gives rise to the capacity for the executive government to influence the performance of the parliamentary duty of a senator or member, which influence it is the constitutional design to eliminate. Second, the provision operates to disqualify a person who holds an office of profit to which that person has not been appointed at the will of the executive government of the Commonwealth or of a State if the continued holding of that office or continued profiting from holding that office is dependent on the will of the executive government of the Commonwealth or of a State. To this aspect of the operation of the provision, the security of the person's tenure and remuneration in such an office, the means by which the person might be removed or suspended from it, and any means by which emoluments of the office might be withheld, are all of critical importance. Executive control over the performance of the functions of the office is relevant only in so far as it might bear on the nature and degree of any executive capacity to achieve such removal or suspension or withholding. The second aspect of the provision's operation will be engaged if, but only if, the executive government has such power over the continued holding of the office or profiting from holding the office as to amount to effective control over holding or profiting from holding the office. The first aspect of the operation of the provision is sufficient to explain the disqualification of Mr Cleary in Sykes v Cleary and of Ms Hughes in Re Nash (No 2). Each held an office of profit to which officeholders were appointed by executive government. On the issues relevantly joined in argument Bell Nettle Gordon in Sykes v Cleary34, it was held not to matter that Mr Cleary's office had become "unattached" and that he had taken leave without pay35. The security of Mr Cleary's and Ms Hughes' tenure was irrelevant and, notably, was not explored in the reasoning in either case. Mr Martin, in contrast, does not hold an office of profit to which officeholders are appointed by executive government. The offices of mayor and of councillor are offices to which officeholders are elected36. Mr Martin's position therefore turns on the second aspect of the operation of s 44(iv), namely, whether the continued holding of those offices, or the receipt of profit from them, turns on the will or continuing will of the executive government of the Commonwealth or of a State. Application of s 44(iv) of the Constitution The incidents of the offices of mayor and of councillor of Devonport City Council, including those which bear on the relationship between those offices and the executive government of Tasmania, are to be found entirely within the provisions of the Local Government Act and subordinate legislation. The Local Government Act divides the State into municipal areas some of which are cities and one of which is Devonport City37, and establishes in each municipal area a council, Devonport City Council being the council in the municipal area which corresponds to Devonport City38. A council is a body corporate39 the functions of which include "to represent and promote the interests 34 (1992) 176 CLR 77 at 88. 35 (1992) 176 CLR 77 at 97-98. 36 Part 4 of the Local Government Act. 37 Section 16 and column 1 of Sched 3, and s 16A and column 1 of Sched 3B to the Local Government Act. 38 Section 18 and column 2 of Sched 3 to the Local Government Act. 39 Section 19 of the Local Government Act. Bell Nettle Gordon of the community" and "to provide for the peace, order and good government of the municipal area"40. A council consists of a mayor (whose functions include "to act as a leader of the community of the municipal area" and "to represent the council on regional organisations and at intergovernmental forums at regional, state and federal levels")41, a deputy mayor42, and councillors (whose functions include "to represent the community", "to act in the best interests of the community" and "to participate in the activities of the council")43. The mayor, the deputy mayor and councillors are each to be elected by electors of the municipal area subject to the proviso that a person cannot accept the office of mayor or deputy mayor unless the person is a councillor44. The term of office of a mayor, a deputy mayor and a councillor is in each case a period of four years from the date of the issue of a certificate of election45. A councillor is entitled to a prescribed allowance and a mayor and deputy mayor are entitled to prescribed allowances in addition to their allowance as councillors46. The allowances are payable by the council from sources of funds which include imposition of rates, fees and charges and obtaining grants and other allocations of money47. 40 Section 20 of the Local Government Act. 41 Sections 25 and 27 of the Local Government Act. 42 Section 25 of the Local Government Act. 43 Sections 25 and 28 of the Local Government Act. 44 Sections 40, 41 and 45 of the Local Government Act. 45 Sections 44 and 46 of the Local Government Act. 46 Section 340A of the Local Government Act. 47 Section 73 of the Local Government Act. Bell Nettle Gordon The prescribed allowance for a councillor of Devonport City Council is currently in excess of $20,000 per annum and the additional prescribed allowance for the mayor of Devonport is currently in excess of $50,000 per annum48. While there is no doubt that the council in a municipal area is a corporation on which is conferred governmental functions sufficient to characterise it as the "State" for the purposes of s 75(iv), s 114 and similar references in the Constitution49, there could be no suggestion that a council or a mayor or deputy mayor or councillor form part of the executive government of Tasmania50. The argument for Ms McCulloch, who alone sought to establish that Mr Martin at all times relevant to the double dissolution election held on 2 July 2016 has held offices of profit under the Crown within the meaning of s 44(iv) of the Constitution, sought to locate the requisite connection between the offices of mayor and of councillor and the executive government of Tasmania in a number of provisions of the Local Government Act which confer certain powers or functions variously on: the Minister administering the Local Government Act ("the Minister"); the Director of Local Government ("the Director", who is a State Service officer or employee appointed by the Governor to undertake the general administration of the Local Government Act subject to the direction of the Minister51); the Governor of Tasmania; 48 Regulation 42 and Sched 4 to the Local Government (General) Regulations 2015 (Tas). 49 Deputy Commissioner of Taxation v State Bank (NSW) (1992) 174 CLR 219 at 233; [1992] HCA 6, citing The Municipal Council of Sydney v The Commonwealth (1904) 1 CLR 208; [1904] HCA 50. 50 Cf Sydney City Council v Reid (1994) 34 NSWLR 506 at 519-520. 51 Sections 334 and 335 of the Local Government Act. Bell Nettle Gordon the Code of Conduct Panel (which is established by the Act and which, when investigating and determining a code of conduct complaint, is constituted by an Australian lawyer and two other persons with experience in local government each appointed by the Minister52); the Local Government Board (which is established by the Act and which is comprised of the Director or his or her nominee together with a chairperson and nominees of the Local Government Association of Tasmania and Local Government Managers Australia (Tasmania), each appointed by the Minister53); and Boards of Inquiry (which may be established by the Minister and which are to consist of one or more persons appointed by the Minister54). The answer to the argument is that the provisions on which Ms McCulloch relied do not alone or in combination confer power on the executive government of Tasmania over the continued holding of the office or profiting from holding the office of mayor or of councillor sufficient to amount to effective control over holding or profiting from holding those offices. To explain that answer, it is necessary to refer to each provision or set of provisions in turn. The first set of provisions comprises ss 27A and 28AA, which allow the Minister, after consultation with a council, to make orders imposing on mayors such functions as the Minister considers appropriate and clarifying the functions of mayors and of councillors. Neither section gives the Minister any power over the holding of the office or profiting from holding the office of mayor or of councillor. Ministerial control over the functions of those offices is not to the point. The second, third and fourth sets of provisions may be considered together. They have the common feature that they provide for the suspension or removal or dismissal of a councillor from office by or on the recommendation of the Minister or of other officeholders who in the performance of their relevant 52 Sections 28K and 28L of the Local Government Act. 53 Section 210 of the Local Government Act. 54 Section 215 of the Local Government Act. Bell Nettle Gordon functions may be accepted to form part of the executive government of Tasmania. The second set of provisions is contained within Div 3A of Pt 3. That Division requires the Minister, by order, to make a model code of conduct relating to the conduct of councillors and permits the Minister, by order, to amend or revoke and substitute the model code of conduct55. The model code of conduct must provide for matters which include "the proper and improper use by a councillor of his or her office with the council" and "the appropriate or inappropriate behaviour of a councillor in his or her relationships with the community, other councillors and council employees" and may provide for "any other matter relating to the conduct of councillors that the Minister considers appropriate and is consistent with" the Local Government Act56. Each council must adopt the model code of conduct as its code of conduct with or without such variations as are allowed by the model code of conduct57. In performing the functions and exercising the powers of his or her office with a council, a councillor is obliged to comply with the provisions of the council's code of conduct58. A complaint of breach triggers a statutory procedure which can result in referral to the Code of Conduct Panel for investigation by means of a hearing59. If the complaint is upheld in whole or in part, the Code of Conduct Panel has power to impose one or more sanctions against a councillor ranging from a reprimand to a suspension from performing and exercising the functions and powers of his or her office as a councillor for a period not exceeding three months60. A councillor is not entitled to any allowances during such a period of suspension61. If the Code of Conduct Panel imposes a third suspension on a councillor during the councillor's current term of office or during a period of two 55 Section 28R of the Local Government Act. 56 Section 28S of the Local Government Act. 57 Section 28T of the Local Government Act. 58 Section 28U of the Local Government Act. 59 Subdivision 3 of Div 3A of Pt 3 of the Local Government Act. 60 Section 28ZI of the Local Government Act. 61 Section 340A of the Local Government Act. Bell Nettle Gordon consecutive terms, the Panel is to notify the Minister of that suspension and of the details of each suspension of the councillor during the prescribed period, on receipt of which the Minister may remove the councillor from office62. The third set of provisions is contained within Pt 12B. Under that Part, the Minister is empowered, on the recommendation of the Director, to issue a direction requiring a council or councillor "to take, refrain from taking or cease taking an action for the purpose of complying with the statutory obligations of the council or councillor under [the Local Government Act] or any other Act"63. If a council or councillor fails to comply with such a direction, the Minister is empowered to suspend all or any of the councillors from office for a period not exceeding six months64. Additionally or alternatively, the Minister is empowered to require the Local Government Board to carry out a review of the council65, which is to result in a written report to the Minister containing recommendations which the Minister can accept or reject66, and as a result of which the Governor on the recommendation of the Minister has the ability to exercise a range of powers which include abolishing a council and dismissing all the councillors of a council67. Additionally or alternatively again, the Minister has the option of establishing a Board of Inquiry to investigate the council68. The fourth set of provisions is contained in Pt 13. Under that Part, the Minister is empowered to establish a Board of Inquiry to investigate a council if the Minister is satisfied that a matter justifies its establishment69. The functions of the Board of Inquiry are to conduct an inquiry into the matter referred to it by 62 Section 28ZL of the Local Government Act. 63 Section 214M of the Local Government Act. 64 Section 214O(1)(a) of the Local Government Act. 65 Section 214O(1)(b) of the Local Government Act. 66 Section 214D of the Local Government Act. 67 Section 214E of the Local Government Act. 68 Section 214O(1)(c) of the Local Government Act. 69 Section 215 of the Local Government Act. Bell Nettle Gordon the Minister and to make recommendations to the Minister as a result of its inquiry70. After considering a report from the Board of Inquiry, and inviting and considering submissions from the council or councillor concerned, the Minister may direct the council or councillor to take any one or more of a range of remedial actions71. Failure to comply with such a direction by a councillor or the council can result in the Minister recommending that the Governor by order dismiss the councillor or all councillors72. Instead of making such a direction to a council or councillor, the Minister may recommend that the Governor by order dismiss any councillor or all councillors if, in the opinion of the Minister, the failure of the councillor or council to perform any function has seriously affected the operation of the council or the irregularity of the conduct of the councillor or council has seriously affected the operation of the council73. During the period between establishing the Board of Inquiry and either the giving of a direction to a councillor or the council or the coming into effect of an order dismissing a councillor or all councillors, the Minister also has power to suspend a councillor or all councillors from office74. Councillors so suspended are not entitled to any allowances during the period of suspension75. the culmination of an administrative process which With the exception of interim suspension by the Minister pending the outcome of a Board of Inquiry established under Pt 13, suspension or removal or dismissal pursuant to the second, third and fourth sets of provisions is in each case involves an administrative finding of non-compliance with a statutory norm involving a measure of misconduct or dereliction of duty. The interim suspension that can occur pending the outcome of a Board of Inquiry established under Pt 13 is in the context of an administrative process having been commenced which may lead to an administrative finding of that nature. The suspension or removal or dismissal is in each case capable of being imposed only in the exercise of a statutory 70 Section 216 of the Local Government Act. 71 Section 225 of the Local Government Act. 72 Section 226(2) of the Local Government Act. 73 Section 226(1) of the Local Government Act. 74 Section 215(5) of the Local Government Act. 75 Section 340A of the Local Government Act. Bell Nettle Gordon discretion the permissible exercise of which is bounded by the subject matter, scope and purposes of the Local Government Act. Ensuring the lawful exercise of that discretion within those bounds is in each case within the supervisory jurisdiction of the Supreme Court of Tasmania. When regard is had to those individually and additional cumulatively confer on the executive government of Tasmania to suspend or remove or dismiss a councillor from office cannot be characterised as rising to the level of control. the power which the provisions features, The remaining provision on which Ms McCulloch relied is s 340A, which, when read with the general regulation-making power in the Local Government Act76, is the source of authority for the Governor to make regulations which prescribe the allowances to which a mayor, a deputy mayor and councillors are entitled. Like other regulations made in the exercise of the general regulation- making power, a regulation made for the purpose of s 340A is subordinate legislation which is governed by the Subordinate Legislation Act 1992 (Tas) and disallowable by resolution of either House of the Tasmanian Parliament under s 47 of the Acts Interpretation Act 1931 (Tas). The authority of the Governor to promulgate subordinate legislation setting the remuneration attaching to the holding of the relevant offices is likewise bounded by the subject matter, scope and purposes of the Local Government Act and ensuring its lawful exercise within those bounds is likewise within the supervisory jurisdiction of the Supreme Court of Tasmania. The authority would be used for an improper purpose were the allowance of a mayor, deputy mayor or councillor who happened to be a senator or member of the House of Representatives altered by way of penalty or reward for anything done or proposed to be done in that other capacity. The authority does not amount to executive control over profiting from those offices so as to engage s 44(iv) of the Constitution. 76 Section 349 of the Local Government Act. Edelman Introduction Section 44 of the Constitution relevantly provides: "Any person who: holds any office of profit under the Crown, or any pension payable during the pleasure of the Crown out of any of the revenues of the Commonwealth; ... shall be incapable of being chosen or of sitting as a senator or a member of the House of Representatives. But subsection (iv) does not apply to the office of any of the Queen's Ministers of State for the Commonwealth, or of any of the Queen's Ministers for a State, or to the receipt of pay, half pay, or a pension, by any person as an officer or member of the Queen's navy or army, or to the receipt of pay as an officer or member of the naval or military forces of the Commonwealth by any person whose services are not wholly employed by the Commonwealth." At all relevant times in 2016, from the close of the Rolls until the return of the writ for the election of Senators, Mr Martin held offices of profit as a councillor of Devonport City Council and as mayor of Devonport. The issue on this reference was whether the offices of profit held by Mr Martin were "under the Crown" within the meaning of s 44(iv) of the Constitution. If so, then Mr Martin was incapable of being chosen or of sitting as a Senator at the federal election held on 2 July 2016. He would therefore be incapable of filling the vacancy created following the ineligibility of Ms Lambie. In 1992, in Sykes v Cleary77, a majority of this Court, sitting as the Court of Disputed Returns, held that Mr Cleary was incapable of being chosen as a member of the House of Representatives by operation of s 44(iv) of the Constitution. The office of profit under the Crown held by Mr Cleary – although he was on leave without pay – was that of teacher in the Education Department of Victoria78. A party to this reference, Ms McCulloch, submitted that if the 77 (1992) 176 CLR 77; [1992] HCA 60. 78 (1992) 176 CLR 77 at 93-94. Edelman office of school teacher is an office of profit under the Crown, then the offices of councillor and mayor must also be offices of profit under the Crown. In the parties' submissions, two different approaches were taken to the construction of "office of profit under the Crown" in s 44(iv) of the Constitution. Although there were differences in emphasis, the submissions of Ms McCulloch, Mr Martin, and the Attorney-General for the State of Victoria can be collectively treated as the first approach. That approach focused upon the ordinary meaning of "under" as requiring, in every case, an evaluation of all of the incidents of the office, and the extent to which it is controlled by the executive government of Tasmania. If that approach were adopted, there would be real force in Ms McCulloch's submission that it would be an anomaly to treat a school teacher as holding an office of profit under the Crown, but not a councillor or mayor. The second approach to the construction of "office of profit under the Crown" was the submission of the Attorney-General of the Commonwealth. His submission was that an office of profit is under the Crown if (i) the office is appointed by the executive government, or (ii) the person holds the office subject to the power of the executive government to remove the person at will or to alter the remuneration of the office at will. Like the first approach, the enquiry required by this submission involved evaluation. But the enquiry was not into some unspecified degree of control by the Crown. It was into whether there was complete control by the Crown over appointment to the office, removal from the office, or the profits from the office. This submission is inconsistent with the decision of this Court in Sykes v Cleary, which treated holding of an office as employment in the public service. The Court considered Mr Cleary's submission that the only persons subject to sufficient power of the executive government to require disqualification were those "who hold important or senior positions in government"79. In his 1887-1888 lectures, Maitland had explained that governmental offices of "high order" and "executive officers" were positions that could be dismissed at the will of the Crown80. In rejecting Mr Cleary's submission three members of this Court said that "[h]istory provides no support for this interpretation which would, in any event, fail to give effect to all the considerations or policies said to underlie the disqualification"81. If the matter were free from (i) the unchallenged authority of the decision in Sykes v Cleary, and (ii) the pre-Federation purpose and context, relevant to informing the meaning of the expression "under the Crown" in the sense it was 79 (1992) 176 CLR 77 at 96. 80 Maitland, The Constitutional History of England, (1955) at 428-429. 81 (1992) 176 CLR 77 at 96 per Mason CJ, Toohey and McHugh JJ, with whom Brennan, Dawson and Gaudron JJ agreed. Edelman intended to have in its continuing operation, the choice might be between the first and second approaches. That choice would be one of degree. The question would be whether the preposition in the expression "office of profit under the Crown", in its unchanged, ordinary meaning informed by constitutional purpose, required complete control by the Crown over the appointment to the office, the removal from the office, or the profits from the office. On the Commonwealth's submission, anything short of complete control, even complete control over appointment or remuneration subject only to disallowance by Parliament82, would not disqualify. Neither of these approaches should be accepted. The meaning of the expression "office of profit under the Crown" in s 44(iv) of the Constitution had crystallised after two centuries of legal usage prior to Federation. As Sir Samuel Griffith QC said in submissions in 1889, it was "an old phrase, well understood in relation to parliamentary law"83. Although its application to particular facts was not always simple, the phrase encompassed (i) offices "from" the Crown, where the holder was appointed by the Crown, and (ii) as decided in Sykes v Cleary, offices, whether or not from the Crown, which involved employment by the Crown. Prior to Federation, this second limb of an office "under the Crown" had been described as membership of the public service84. In Sykes v Cleary, Mason CJ, Toohey and McHugh JJ, whose reasons concerning s 44(iv) were the subject of express agreement by Brennan J85, Dawson J86 and Gaudron J87, applied this second limb, explaining that it had been accepted in England and Australia that an "office of profit under the Crown" encompassed public 82 See, eg, as to the profits from the office, Local Government Act 1993 (Tas), s 340A; Acts Interpretation Act 1931 (Tas), s 47(4). See, eg, as to appointment, Ombudsman Act 1974 (NSW), s 31BA; Public Finance and Audit Act 1983 (NSW), s 57A; Independent Commission Against Corruption Act 1988 (NSW), s 64A. 83 Hodel v Cruckshank (1889) 3 QLJ 141 at 141. 84 Day, Rogers on Elections, 17th ed (1895), vol 2 at 10, 44; Erskine May and Palgrave, A Treatise on the Law, Privileges, Proceedings and Usage of Parliament, 10th ed (1893) at 603. See also United Kingdom, House of Commons, Report from the Select Committee on Offices or Places of Profit under the Crown, (1941) at 29 (Minutes of Evidence); Maitland, The Constitutional History of England, (1955) at 85 (1992) 176 CLR 77 at 108. 86 (1992) 176 CLR 77 at 130. 87 (1992) 176 CLR 77 at 132. Edelman servants88 and that the disqualification embraced "at least those persons who are permanently employed by government"89. This second limb was the reason why the Court held that Mr Cleary, who was employed by the Crown but plainly could not be dismissed at will, was disqualified by s 44(iv). It is also the reason why Mr Martin, who was not employed by the Crown, was not, and is not, disqualified. For these reasons, set out in more detail below, I joined in the orders made. The historical context and purpose of the phrase "under the Crown" The distinction between offices "from" and "under" the Crown There was no dispute on this reference that Mr Martin held offices of profit as councillor and as mayor. It was also common ground that although "the Crown" was used at the time of Federation in "several metaphorical senses"90, the sense in which it was used in s 44(iv) was to refer to the executive branch of government, represented by the ministry and administrative bureaucracy91. The only issue was whether the offices of profit held by Mr Martin were "under" the Crown. In the joint judgment in Sykes v Cleary92, their Honours referred to the history and purpose of s 44(iv) as derived from the Act of Settlement 170193, as repealed and replaced in 170594 and re-enacted by ss 24 and 25 of the Succession to the Crown Act 170795. At the time of Federation, this legislation was still in force in the United Kingdom and had formed "the foundation of all subsequent legislation"96 that had "reimposed"97 the disqualification in particular contexts. 88 (1992) 176 CLR 77 at 95. 89 (1992) 176 CLR 77 at 96. 90 Sue v Hill (1999) 199 CLR 462 at 498 [83]; [1999] HCA 30. 91 Sue v Hill (1999) 199 CLR 462 at 499 [87]. 92 (1992) 176 CLR 77 at 95-98. 93 12 & 13 Will 3 c 2, s 3. 94 4 & 5 Anne c 20, ss 29, 30. 95 6 Anne c 41. 96 Maitland, The Constitutional History of England, (1955) at 368. 97 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 75. Edelman In the centuries before Federation it became generally accepted that ss 24 and 25 drew a distinction between (i) "old offices" (existing before the Act in 1705) in s 25, to which disqualification applied if the office was "from the Crown", and (ii) new offices (existing after the Act in 1705) in s 24, to which disqualification applied if the office was "under the Crown"98. The difference between the expressions came to be recognised, as the authors of Rogers on Elections suggested in 185799, and repeated in every edition between 1857 and 1895100, as being that offices "from the Crown" were only those that were "in the immediate patronage of the Crown", whilst those "under the Crown" were not so limited and included both offices from the Crown and "all offices connected with the public service". Erskine May directed his readers to that explanation in 1893101. The same view was later reiterated by Sir Gilbert Campion in evidence before the House of Commons Select Committee on Offices or Places of Profit under the Crown102. 98 United Kingdom, House of Commons, Report from the Select Committee on Offices or Places of Profit under the Crown, (1941) at xiii, 144 [21]. See also Anson, The Law and Custom of the Constitution, (1886), pt 1 at 75; Day, Rogers on Elections, 17th ed (1895), vol 2 at 10, 44. 99 Power, Rogers and Wolferstan, Rogers' Law and Practice of Elections, and Registration, 8th ed (1857) at 189. 100 Rogers and Wolferstan, Rogers' Law and Practice of Elections, Election Committees, and Registration, 9th ed (1859) at 194; Wolferstan, Rogers on Elections, Election Committees, and Registration, 10th ed (1865) at 205; Wolferstan, Rogers on Elections and Registration, 11th ed (1868) at 222; Wolferstan, Rogers on Elections, Registration, and Election Agency, 12th ed (1876) at 237; Carter, Rogers on Elections, Registration, and Election Agency, 13th ed (1880) at 219; Carter and Sandars, Rogers on Elections, 15th ed (1886), pt 2 at 578; Day, Rogers on Elections, 16th ed (1892), pt 2 at 10, 63; Day, Rogers on Elections, 17th ed (1895), vol 2 at 10, 44. 101 Erskine May and Palgrave, A Treatise on the Law, Privileges, Proceedings and Usage of Parliament, 10th ed (1893) at 603. 102 United Kingdom, House of Commons, Report from the Select Committee on Offices or Places of Profit under the Crown, (1941) at 154 [51] (Appendix 2 to Minutes of Evidence). See also at 29 (Minutes of Evidence). Edelman The two expressions were also commonly used with different meanings in colonial constitutions103. For instance, ss 18 and 19 of the New South Wales Constitution Act 1855 (Imp)104 created separate disqualifications for offices of profit held under the Crown and offices of profit accepted from the Crown. It is unnecessary on this reference to consider the effect of any distinction between holding an office and accepting an office because it was common ground that Mr Martin held the offices of councillor and mayor, which is the relevant criterion for s 44(iv)105. It suffices to say that, consistently with historical usage, ss 18 and 19 treated offices of profit held under the Crown as a broader concept than those offices accepted from the Crown. Offices under the Crown because they were "from" the Crown Prior to Federation, offices appointed by, and therefore from, the Crown were all offices "under" the Crown, no matter how little control or influence the Crown might have over the office. Justices of the peace held offices under the Crown106 because they were appointed by the Crown. During the Convention Debates, it was assumed by the delegates that judges, appointed by the Crown, held offices of profit under the Crown107. And in Re Nash (No 2)108, this Court held that the office of member of the Administrative Appeals Tribunal is an office of profit under the Crown. This was because it is an office appointed by, and therefore from, the Crown. An office from the Crown included all manner of appointments, including appointments to statutory boards and tribunals. Very shortly before Federation, 103 Constitutional Act 1854 (Tas) (18 Vict No 17), ss 27, 32; New South Wales Constitution Act 1855 (Imp) (18 & 19 Vict c 54), Sched 1, ss 18, 19; Victoria Constitution Act 1855 (Imp) (18 & 19 Vict c 55), Sched 1, ss 17, 51; Constitution Act 1855-6 (SA) (Act No 2 of 1855-6), ss 17, 39; Constitution Act 1867 (Q) (31 Vict No 38), s 20; Western Australia Constitution Act 1890 (Imp) (53 & 54 Vict c 26), Sched 1, ss 6, 28, 29(5), 71. 104 18 & 19 Vict c 54. 105 Compare R v Jones [1999] WASCA 194 at [30] with Twomey, The Constitution of New South Wales, (2004) at 434. 106 Hodel v Cruckshank (1889) 3 QLJ 141 at 142. 107 Official Report of the National Australasian Convention Debates, (Adelaide), 17 April 1897 at 739-745; Official Record of the Debates of the Australasian Federal Convention, (Sydney), 21 September 1897 at 1028-1029. 108 (2017) 92 ALJR 23 at 26 [9]; 350 ALR 204 at 207; [2017] HCA 52. Edelman the office of member of the Board of Stock Commissioners, appointed by the Governor in Council under the Diseases in Stock Act 1896 (Q)109, was held110 to be an office of profit under the Crown within the meaning of the Officials in Parliament Act 1896 (Q)111. However, if the office was not appointed by the Crown then it was not from the Crown, even if appointed by an officer of the Crown. An example was the Clerk of the Pells, which was an office appointed by the Treasurer of the Exchequer, rather than directly from the Crown. Hence, it was not an office from the Crown112. Nor were the offices of Masters in Chancery, prior to 1833113, when they were not appointed by the Crown but by the Lord Chancellor114. The rationale for a strong rule of disqualification where the office was "from the Crown" was that the process of appointment to an office by the Crown was regarded as "the conferring of a benefit upon some person whom the appointer wished to favour or reward"115. Prior to the Act of Settlement and its successors, in a practice that originated in the Tudor and Stuart periods and continued until the Revolution, an appointment could be made by the Crown in exchange for payment or as a reward for political service116. The disqualification from parliamentary office of persons appointed to profitable offices reduced the conflict between pecuniary interest and parliamentary duty. There were well-known exceptions that all appointments from the Crown led to the holder's disqualification from election to Parliament. One exception was the office of Minister of State. The holders of the high offices of State were required to be able to serve in Parliament because the general rule 109 60 Vict No 1, s 5(1). 110 Bowman v Hood (1899) 9 QLJ 272 at 278. See, later, Clydesdale v Hughes (1934) 36 WALR 73. 111 60 Vict No 3, s 5. 112 Hatsell, Precedents of Proceedings in the House of Commons, 2nd ed (reprint) (1785), vol 1 at 44. 113 Falconer and Fitzherbert, Cases of Controverted Elections, Determined in Committees of the House of Commons, in the Second Parliament of the Reign of Queen Victoria, (1839) at 583-584, 587. 114 Harrison, The Practice of the High Court of Chancery, (1808), vol 1 at 15. 115 Holdsworth, A History of English Law, (1938), vol 10 at 509. 116 Holdsworth, A History of English Law, (1938), vol 10 at 509. Edelman "their business must be conducted subject to the criticism of the representatives of the people"117. This reasoning must have informed the express exemption of Ministers from disqualification by s 44 of the Constitution. In the 1941 House of Commons Select Committee Report118, it was suggested that there had been doubt about whether the disqualification of holders of offices under the Crown in the United Kingdom included several particular appointments made by the Crown: the Regius Professors of the Universities of Oxford and Cambridge; the Master of Trinity College, Cambridge; and the Provost of Eton. The doubt was said to exist because the offices had no political significance and the stipends attached to them were not paid by the Crown or out of public funds. But even if analogous offices existed in Australia, it would be difficult to see a reason why such exceptions, not included in the express exemptions in s 44(iv), should be implied. Even in these instances, there were notorious examples of circumstances in which the Crown exercised power to make controversial selections of a Regius Professor or to veto a candidate119. Offices under the Crown that were not "from" the Crown There were other offices "under the Crown" apart from those offices "from" (or appointed by) the Crown. As I have mentioned, the circumstances in which other offices would fall "under the Crown" were considered by the authors of Rogers on Elections, Erskine May, and Sir Gilbert Campion to be where those offices were "connected with the public service". Professor Maitland's subsequently published lectures of 1887-1888 took the same approach120. This approach was reflected in the joint judgment in Sykes v Cleary121, where it was held that s 44(iv) disqualifies "public servants, who are officers of the departments of government, from membership of the legislature". That expression of the disqualification embraced "at least those persons who are permanently employed by government"122. 117 Anson, The Law and Custom of the Constitution, (1892), pt 2 at 195. 118 United Kingdom, House of Commons, Report from the Select Committee on Offices or Places of Profit under the Crown, (1941) at xxv. 119 See, eg, Hibbert, Edward VII: The Last Victorian King, (2007) at 209. 120 Maitland, The Constitutional History of England, (1955) at 369: "the holders of subordinate offices in the civil service of the crown are in general absolutely disqualified". 121 (1992) 176 CLR 77 at 95. 122 (1992) 176 CLR 77 at 96. Edelman The concept, at Federation, of a public, or civil, servant as holding an office under the Crown ordinarily involved a conception of recruitment by interview or examination123, age limits and compulsory retirement124, and potential dismissal of some such servants at the pleasure of the Crown125. But none of these incidents was part of any "special prerogative"126 of the Crown and, during a period in which employment in the public service was in a state of flux127, none was part of the concept of a public servant, relevant to the meaning of an office of profit under the Crown in s 44(iv). The essential meaning involved a relationship, subject to control by the Crown, which could be that essential meaning characterised as employment. (employment) may have changed but the meaning remains the same128. The content of The characterisation of "employment" by the Crown as the meaning of the second limb of offices of profit "under the Crown" reflects the manifested intention to maintain the consequence, known and desired at Federation, that the disqualification of public servants from Parliament had played "an important part in the development of the old tradition of a politically neutral public service"129. As Maitland explained, the disqualification of those holding subordinate offices had the consequence of creating a permanent civil service "unidentified with any particular policy", whereas "were [civil servants] in parliament they might easily fall out with their superiors, and we should have the whole civil service changing with the ministry"130. The objective desire to maintain that consequence therefore informed the purpose and meaning of "under the Crown" in s 44(iv), just as it had informed the purpose of the 19th century reimposition of disqualifications "under the Crown" since the emergence of an independent public service. 123 Halsbury, The Laws of England, (1909), vol 7 at 80-81, §139. 124 Cohen, The Growth of the British Civil Service 1780–1939, (1941) at 19. 125 Dunn v The Queen [1896] 1 QB 116 at 119, 120; Carey v The Commonwealth (1921) 30 CLR 132 at 135; [1921] HCA 54; Holdsworth, A History of English Law, (1964), vol 14 at 131. 126 Shenton v Smith [1895] AC 229 at 234-235. 127 Zafarullah, Colonial Bureaucracies: Politics of Administrative Reform in Nineteenth Century Australia, (2014) at 216-217. 128 Birmingham City Council v Oakley [2001] 1 AC 617 at 631. 129 Sykes v Cleary (1992) 176 CLR 77 at 96. 130 Maitland, The Constitutional History of England, (1955) at 369. Edelman Sir William Anson explained how maintaining this desirable consequence had been a rationale for many "more modern"131 (ie 19th century, when he was writing) disqualifications of offices of profit under the Crown. He said132 that the legislature had not been content to "leave new offices to the operation of the [Succession to the Crown Act]" but had "reimposed the disqualification in a great number of Acts of Parliament" for new offices under the Crown such as the offices of Charity Commissioner and member of the Council of India. He went on to say that these 19th century disqualifications were133: "for the most part imposed to secure the undivided attention of officials to the business of their departments, and the advantage of a permanent civil service unaffected by changes of ministry or by considerations of party politics." Anson's view – that an independent civil service was a rationale for the 19th century reimpositions of the disqualification provisions from the Succession to the Crown Act – reflected an Order in Council, derived from an 1884 Treasury Minute. That Minute was set out, as below, and described by the Royal Commissioners on the Civil Service in their 1914 Report as "representing the considered opinion of the Government of the day, a view which has been accepted by subsequent Governments without modification"134: "The First Lord expresses to the Board his own strong sense of the public injury which must be the consequence of any departure from the conditions which, under Parliamentary Government, render a permanent Civil Service possible, and he points out that, among those conditions, the essential one is that the members of such a service should remain free to serve the Government of the day, without necessarily exposing themselves to public charges of inconsistency or insincerity." The Commissioners continued, saying that "[t]he rule as to candidature for Parliament by a Civil Servant on the active list has been consistently maintained; but the rule with regard to candidature for County Councils has been altered"135. 131 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 290. 132 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 75. 133 Anson, The Law and Custom of the Constitution, (1886), pt 1 at 290. 134 United Kingdom, Royal Commission on the Civil Service, Fourth Report of the Commissioners, (1914) [Cd 7338] at 95. 135 United Kingdom, Royal Commission on the Civil Service, Fourth Report of the Commissioners, (1914) [Cd 7338] at 95. Edelman There remained also the original purpose for the reimposed 19th century disqualifications that fell under the second limb of "under the Crown". That purpose was the same as the purpose of the expression "under" the Crown in the first limb in its use from the Act of Settlement through to s 44(iv) of the Constitution. It was to avoid conflict between parliamentary duty and pecuniary interest within a Minister's "valuable privilege of patronage over employment in the public service"136. Supplementing and restating these two purposes were the three reasons given in the joint judgment in Sykes v Cleary137 for the incompatibility of positions of employment by the Crown with membership of the Commonwealth Parliament: "First, performance by a public servant of his or her public service duties would impair his or her capacity to attend to the duties of a member of the House. Secondly, there is a very considerable risk that a public servant would share the political opinions of the Minister of his or her department and would not bring to bear as a member of the House a free and independent judgment. Thirdly, membership of the House would detract from the performance of the relevant public service duty." A pre-Federation example of an office "under the Crown" arising from a relationship that could be characterised as one of employment was the office of poundkeeper under the Impounding Act 1863 (Q)138. That office was held in 1889139 to be an office of profit under the Crown, disqualifying the holder from election to a Divisional Board under the Divisional Boards Act 1887 (Q)140. The poundkeeper was appointed and removable by justices of the peace. Like the Clerk of the Pells, who was appointed by an officer of the Crown but not directly by the Crown, it was not suggested that the office of poundkeeper was an office under the Crown because it was appointed by, and therefore "from", the Crown141. Instead, in argument, Mr Real focused upon the Crown's powers over the poundkeeper, including deputing the appointment to the justices, the retention by the Crown of the right to receive money and to revise the poundkeeper's accounts, and the poundkeeper's duty to give a bond and to account for his fees to 136 "The Civil Service", (1876) 105 The Westminster Review 222 at 224. 137 (1992) 176 CLR 77 at 96 (footnote omitted). 138 27 Vict No 22. 139 Hodel v Cruckshank (1889) 3 QLJ 141. 140 51 Vict No 7, s 16(1). 141 See also Maitland, The Constitutional History of England, (1955) at 430. Edelman the Crown142. Similarly, Sir Samuel Griffith QC focused upon all the circumstances of the office, submitting that the "direct authority given to the justices by statute to appoint him" made the poundkeeper a public officer but not one under the Crown143. The question was whether, in all the circumstances, the poundkeeper was "a Crown officer"144. In other words, was he employed by the Crown? The Chief Justice delivered the judgment of the Court. He explained that the justices had the power to appoint the poundkeeper and the power to remove him for neglect or misconduct, "but there, all authority over the poundkeeper by the justices seems to cease"145. The Chief Justice described the question as "whether he was holder of that [office] under the Crown, or was he merely appointed by the Justices of the Peace"146 (emphasis added). The circumstances beyond mere appointment that were found to be sufficient to characterise the office as one under the Crown were the same factors as would be considered in an assessment of whether the poundkeeper was employed by the Crown147: "[T]he justices are limited merely to the appointment, and removal under particular circumstances. Now, a pound is a public pound; it is established, and may be abolished by the act of the Executive Council. The poundkeeper is accountable to the Crown for fees received; he must give a bond to the Crown for the proper discharge of the duties of his office. He is placed under the inspection of an officer of the Crown, called the Inspector of Brands, and his appointment and removal depend on the judgment of other officers of the Crown, who are the Justices of the Peace. It seems to us, that, looking at all these circumstances, and at the Act, that he must be a minor officer of the Crown, whose appointment was made by the Justices of the Peace ... and whose appointment under these circumstances brings him within the law, as a minor officer. That being so, firstly, he is holding an office of profit, and secondly, he is holding that office of profit under the Crown." (emphasis added) 142 Hodel v Cruckshank (1889) 3 QLJ 141 at 141. 143 Hodel v Cruckshank (1889) 3 QLJ 141 at 142. 144 Hodel v Cruckshank (1889) 3 QLJ 141 at 142. 145 Hodel v Cruckshank (1889) 3 QLJ 141 at 142. 146 Hodel v Cruckshank (1889) 3 QLJ 141 at 142. 147 Hodel v Cruckshank (1889) 3 QLJ 141 at 142-143. Edelman In contrast with those offices appointed by, or employed by, the executive government, other offices were not "under the Crown". For instance, a member of State Parliament was not "under the Crown" and therefore not disqualified by s 44(iv)148. There was, and is, also a "principle that Parliament has always asserted in England and elsewhere"149, that "appl[ies] equally"150 in Australia, that the offices of President of the Senate and Speaker of the House of Representatives are not offices under the Crown151. Those offices are appointed by their respective Houses and their holders are not employed by the executive government. Similarly, in England, during the debates on the Representation of the People Act 1867 (UK)152, the Attorney-General, Sir Roundell Palmer153, said that the "uniform practice of the House" was not to treat the office of Under Secretary of State as an office under the Crown because the office "is appointed, both in form and in substance, by the Secretary of State"154. Sykes v Cleary and Mr Martin Mr Cleary was appointed as a teacher under the Teaching Service Act 1958 (Vic)155. That legislation created a statutory tribunal (the Teachers Tribunal), which appointed teachers and determined their pay156. At the time of 148 Moore, The Constitution of the Commonwealth of Australia, 2nd ed (1910) at 129. 149 Official Record of the Debates of the Australasian Federal Convention, (Melbourne), 16 March 1898 at 2448. 150 Harris (ed), House of Representatives Practice, 5th ed (2005) at 162. See Constitution, ss 17, 35; Official Report of the National Australasian Convention Debates, (Sydney), 3 April 1891 at 660. 151 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 493; Jack and Hutton (eds), Erskine May's Treatise on The Law, Privileges, Proceedings and Usage of Parliament, 24th ed (2011) at 59. Cf Official Report of the National Australasian Convention Debates, (Sydney), 3 April 1891 at 661. 152 30 & 31 Vict c 102. 153 Later, the Earl of Selborne, Lord Chancellor. 154 United Kingdom, House of Commons, Parliamentary Debates, vol 174 at 1237 (18 April 1864). See also Anson, The Law and Custom of the Constitution, (1886), pt 1 at 76. 155 Sykes v Cleary (1992) 176 CLR 77 at 94. 156 Teaching Service Act 1958 (Vic), ss 44, 46. Edelman Mr Cleary's appointment as a teacher, the Teachers Tribunal consisted of six members, who served fixed terms157. Three of the members were appointed by the Governor in Council, and two of those appointees represented the Government of Victoria. The other three were elected by teachers158. The members of the Teachers Tribunal were not, in respect of their office, subject to the provisions of the Public Service Act 1958 (Vic)159. At the time of Mr Cleary's appointment it would have been difficult to characterise his office as being held "under the Crown" on the basis of an appointment from the Crown. Perhaps for this reason, the case was not argued with any focus on Mr Cleary's appointment to the office. The Teachers Tribunal was abolished by the Education Service Act 1981 (Vic). By the time Mr Cleary nominated for the House of Representatives, the legislation had become the Teaching Service Act 1981 (Vic). It contained provisions defining teachers as "permanent officers" (s 2) who were "employed by Her Majesty in the teaching service" (s 3)160. The case was argued by the Attorney-General of the Commonwealth161, and by Mr Sykes162, on the basis that Mr Cleary was disqualified because Victorian teachers were employed by the Crown and therefore held offices "under the Crown". One basis upon which that submission was resisted by Mr Cleary was that employment by the Crown was not sufficient to make a teacher a member of the Victorian public service163. The reasoning of the Court, about which "constitutionalism and the rule of law are as 157 Teaching Service Act 1958 (Vic), ss 5, 6. 158 Teaching Service Act 1958 (Vic), s 5. 159 Teaching Service Act 1958 (Vic), s 7(1). 160 Sykes v Cleary (1992) 176 CLR 77 at 117. 161 Outline of Submissions for the Attorney-General of the Commonwealth, 25 August 1992 at 5 [5.3]-[5.4]. See also Sykes v Cleary (1992) 176 CLR 77 at 90. 162 Transcript of Proceedings, 26 August 1992 at 7-8. See also Sykes v Cleary (1992) 176 CLR 77 at 87. 163 Outline of Submissions for Mr Cleary, 26 August 1992 at 2 [2]-[5]; Transcript of Proceedings, 27 August 1992 at 40. Edelman concerned" as they are with the outcome164, was that Mr Cleary was disqualified because he was employed by the Crown165. The joint reasons set out in detail the powers of the executive government of Tasmania over the offices of councillor and mayor held by Mr Martin166. It suffices to describe the most significant of those powers briefly. The executive has a limited power to suspend, remove or dismiss holders of those offices167, and a power, subject to disallowance by Parliament168, to set the remuneration of the offices169. Ms McCulloch rightly did not submit that these powers were sufficient to characterise Mr Martin as being employed by the executive government. The offices held by Mr Martin were not under the Crown because he was neither appointed, nor employed, by the executive government of the State of Tasmania. Conclusion For these reasons, I joined in the order of the Court answering the question reserved as follows: Mr Martin is not incapable of being chosen or of sitting as a Senator by reason of s 44(iv) of the Constitution. 164 Winterton, "Popular Sovereignty and Constitutional Continuity", (1998) 26 Federal Law Review 1 at 2. 165 Sykes v Cleary (1992) 176 CLR 77 at 97, 117. 166 See Local Government Act 1993 (Tas), ss 27A, 28AA, Pt 3 Div 3A, Pt 12B, Pt 13. 167 Local Government Act 1993 (Tas), ss 28ZL(3), 214E, 214O(1)(a), 215(5), 226. 168 Acts Interpretation Act 1931 (Tas), s 47(4). 169 Local Government Act 1993 (Tas), s 340A.
HIGH COURT OF AUSTRALIA Matter No M32/2022 APPELLANT AND MINISTER FOR IMMIGRATION, CITIZENSHIP, MIGRANT SERVICES AND MULTICULTURAL AFFAIRS & ORS RESPONDENTS Matter No S81/2022 DCM20 AND APPELLANT SECRETARY OF DEPARTMENT OF HOME AFFAIRS & ANOR RESPONDENTS Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs DCM20 v Secretary of Department of Home Affairs [2023] HCA 10 Date of Hearing: 19 & 20 October 2022 Date of Judgment: 12 April 2023 M32/2022 & S81/2022 ORDER Matter No M32/2022 Grant leave to the appellant to file an Amended Notice of Appeal. Appeal allowed. Set aside the orders made by the Full Court of the Federal Court of Australia on 23 November 2021 (as varied by the orders of 15 December 2021) and in their place make the following orders: Appeal allowed. Set aside the orders made by O'Callaghan J on 9 June 2020 and in their place make the following orders: Declare that the decision made by the third respondent in purported compliance with on 8 May 2019 section 10.1 of the Minister's guidelines on ministerial powers (s351, s417 and s501J) (11 March 2016) exceeded the executive power of the Commonwealth. The first respondent pay the costs of the applicant. The first respondent pay the costs of the appellant. The first respondent pay the costs of the appellant. Matter No S81/2022 Grant leave to the appellant to file an Amended Notice of Appeal and vary the grant of special leave to appeal accordingly. Appeal allowed. Set aside the orders made by the Full Court of the Federal Court of Australia on 23 November 2021 (as varied by the orders of 15 December 2021) and in their place make the following orders: Appeal allowed. Set aside the orders made by Perry J on 20 July 2020 and in their place make the following orders: that the decision made by the second Declare respondent on 10 January 2020 in purported compliance with section 10.2 of the Minister's guidelines on ministerial powers (s351, s417 and s501J) (11 March the Commonwealth. executive power of exceeded the The first respondent pay the costs of the applicant. The first respondent pay the costs of the appellant. The first respondent pay the costs of the appellant. On appeal from the Federal Court of Australia Representation C J Horan KC with A F L Krohn and A R Sapienza for the appellant in each matter (instructed by Rasan T. Selliah & Associates) the Commonwealth, and S P Donaghue KC, Solicitor-General of N M Wood SC with M F Caristo for the first respondent in each matter and for the Attorney-General of the Commonwealth, intervening in both matters (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales, with M W R Adams for the Attorney-General for the State of New South Wales, intervening in both matters (instructed by Crown Solicitor (NSW)) M J Wait SC, Solicitor-General for the State of South Australia, with J F Metzer for the Attorney-General for the State of South Australia, intervening in both matters (instructed by Crown Solicitor's Office (SA)) R J Orr KC, Solicitor-General for the State of Victoria, with M A Hosking for the Attorney-General for the State of Victoria, intervening in both matters (instructed by Victorian Government Solicitor's Office) Submitting appearances for the second and third respondents in M32/2022 and for the second respondent in S81/2022 Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs DCM20 v Secretary of Department of Home Affairs Constitutional law (Cth) – Executive power of the Commonwealth – Where s 351 of Migration Act 1958 (Cth) permitted Minister to personally exercise power to substitute more favourable decision for decision of tribunal – Where requests made for Minister to exercise power under s 351 – Where Minister issued instructions to departmental officers in purported exercise of executive power for general conduct of requests to substitute more favourable decision under s 351 ("Ministerial Instructions") – Where Ministerial Instructions required departmental officers to refer requests to Minister only where satisfied that "unique or exceptional circumstances" exist in respect of request – Whether Ministerial Instructions purported to instruct departmental officers to make decisions required to be exercised personally by Minister – Whether Ministerial Instructions exceeded limits of executive power as constrained by s 351 of Act. Administrative law – Judicial review – Whether decisions in purported compliance with Ministerial Instructions exceeded limits of Commonwealth executive power. High Court – Appellate jurisdiction – Whether Federal Court lacked jurisdiction to hear appeals by reason of s 476A(1) of Act – Consideration of character of purported decisions of departmental officers – Whether High Court accordingly deprived of jurisdiction to hear appeal. Judgments and orders – Where appellants sought declarations as to departmental officers' legal error – Whether appellants had sufficient material interest to seek declaratory relief – Whether declaratory relief appropriate. Words and phrases – "decision made personally", "declaratory relief", "evaluation of the public interest", "executive power of the Commonwealth", "guidelines", "Ministerial Instructions", "more favourable decision", "non-compellable power", "non-delegable power", "non-statutory action", "personal power", "procedural decision", "public interest", "repeat request", "statutory decision", "statutory limitation", "substantive decision", "unique or exceptional circumstances", "2009 Ministerial Instructions", "2016 Ministerial Instructions". Constitution, ss 61, 64, 67, 73. Federal Court of Australia Act 1976 (Cth), s 21. Judiciary Act 1903 (Cth), ss 37, 39B. Migration Act 1958 (Cth), ss 351, 474, 476A. KIEFEL CJ, GAGELER AND GLEESON JJ. Two appeals are brought from a decision of the Full Court of the Federal Court of Australia1. Each arises out of an application in the original jurisdiction of the Federal Court for judicial review of a decision of a departmental officer not to refer to a Minister a request to exercise the power conferred on that Minister by s 351(1) of the Migration Act 1958 (Cth) ("the Act") to substitute in the "public interest" a more favourable decision for a decision made or taken to be made by the Administrative Appeals Tribunal ("the Tribunal") under s 349(2)(a) of the Act affirming a refusal by a delegate of the Minister to grant the applicant a visa. The Full Court dismissed an appeal from the dismissal of each application. Each departmental decision not to refer a request to the Minister was made in purported compliance with instructions issued in 2016 by the then Minister for Immigration and Border Protection ("the 2016 Ministerial Instructions")2. The 2016 Ministerial Instructions relevantly instructed departmental officers not to refer a request to exercise the power conferred by s 351 of the Act to a Minister in any case which departmental officers assessed not to "have unique or exceptional circumstances". Each departmental decision not to refer turned on the departmental officer assessing the case in relation to which the request was made not to meet that criterion for referral. The 2016 Ministerial Instructions superseded earlier instructions issued by the then Minister for Immigration and Citizenship in 2009 ("the 2009 Ministerial Instructions")3. The 2009 Ministerial Instructions were considered by this Court in Plaintiff S10/2011 v Minister for Immigration and Citizenship4. Consistently with what was found in Plaintiff S10/2011 in relation to the 2009 Ministerial Instructions and in relation to departmental decisions made in purported compliance with the 2009 Ministerial Instructions, the Full Court found that neither the issuing of the 2016 Ministerial Instructions nor the making of the departmental decisions in purported compliance with the 2016 Ministerial Instructions involved exercise of any power conferred by statute. Each was rather a purported exercise of the executive power of the Commonwealth conferred by 1 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23. 2 Minister's guidelines on ministerial powers (s351, s417 and s501J) (11 March 2016). 3 Minister's guidelines on ministerial powers (s345, s351, s391, s417, s454 and s501J) (14 September 2009). (2012) 246 CLR 636. Gleeson s 61 of the Constitution. More specifically, each was a purported exercise of "an executive function incidental to the administration of the Act and thus within that aspect of the executive power which 'extends to the execution and maintenance ... of the laws of the Commonwealth'"5. Those findings are not contested in these appeals. The Full Court held that the aspect of the executive power of the Commonwealth purportedly exercised in making the departmental decisions is conditioned by a common law requirement for reasonableness in its exercise. The Full Court nevertheless found that neither impugned departmental decision was in fact unreasonable. The first ground of each appeal challenges the finding that the departmental decision impugned was not unreasonable. By notice of contention in each appeal, the first respondent denies that any aspect of the executive power of the Commonwealth is conditioned by a common law requirement of reasonableness. Whether any aspect of the executive power of the Commonwealth is conditioned by any requirement of reasonableness is a very large question. The question need not, and therefore should not, be addressed in the determination of these appeals. Each appeal is rather to be determined on a second, logically anterior, ground not fully developed before the Full Court. The ground is founded on the proposition that, by conferring statutory power to substitute or not to substitute a decision in the public interest on a Minister personally, s 351 of the Act limits the executive power of the Commonwealth by excluding the capacity for another executive officer to decide that it is or is not in the public interest for the statutory power to be exercised. The ground is to the effect that the issuing and maintenance of the 2016 Ministerial Instructions, and the departmental decisions made in purported compliance with them, exceeded the executive power of the Commonwealth as so limited to the extent that the 2016 Ministerial Instructions instructed departmental officers not to refer requests in cases which departmental officers themselves assessed not to have unique or exceptional circumstances. To explain the upholding of that ground further, and to explain the orders which are appropriate to be made in the appeals, it is best to begin by examining 5 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 29 [14], citing Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 655 [51]. Gleeson the nature and content of the statutory power conferred by s 351 of the Act before turning to examine its impact on the executive power of the Commonwealth. The nature and content of the statutory power Section 351 provides: If the Minister thinks that it is in the public interest to do so, the Minister may substitute for a decision of the Tribunal under section 349 another decision, being a decision that is more favourable to the applicant, whether or not the Tribunal had the power to make that other decision. The power under subsection (1) may only be exercised by the Minister personally. If the Minister substitutes a decision under subsection (1), he or she is to cause to be laid before each House of the Parliament a statement that: sets out the decision of the Tribunal; and sets out the decision substituted by the Minister; and sets out the reasons for the Minister's decision, referring in particular to the Minister's reasons for thinking that his or her actions are in the public interest. The Minister does not have a duty to consider whether to exercise the power under subsection (1) in respect of any decision, whether he or she is requested to do so by the applicant or by any other person, or in any other circumstances." The references throughout s 351 to "the Minister" encompass any of the Ministers who from time to time administer that section in accordance with Gleeson Administrative Arrangements Orders issued by the Governor-General6 as well as any other Minister who might be authorised to act on behalf of such a Minister7. Section 351(1) is a conferral of power on the Minister. Section 351(3) and s 351(7) explain the nature of the power so conferred. The prescription in s 351(3) that the power may only be exercised by the Minister personally means that the power is neither delegable by the Minister under s 496 of the Act nor exercisable on the Minister's behalf by any officer of the Department administered by the Minister under s 64 of the Constitution8. The prescription in s 351(7) that the Minister does not have a duty to consider whether to exercise the power in any circumstances means exactly what it says. Under no circumstances can the Minister be compelled to exercise the power. The structure of the section is relevantly indistinguishable from the structure of a number of other sections of the Act which confer personal and non- compellable powers on the Minister. Those other sections include ss 46A, 48B, 195A and 417, each of which has been considered by this Court in one or more of Plaintiff M61/2010E v The Commonwealth9, Plaintiff S10/2011, Plaintiff M79/2012 v Minister for Immigration and Citizenship10, Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship11 and Minister for Immigration and Border Protection v SZSSJ12. Drawing on the reasoning in those cases, the content of the power conferred by s 351(1) can be explicated as follows. The Minister exercises the power conferred by s 351(1) by personally making the first or both of two distinct sequential statutory decisions neither of which the Minister is obliged to make. The first is procedural. The second is substantive. The procedural decision is either to consider, or to not consider, whether it is in the public interest to substitute a more favourable decision for a decision of the Tribunal. The substantive decision – which the Minister may but need not make where the Minister has made a procedural decision to consider See ss 19(1) Item 1 and 19(2)(a) of the Acts Interpretation Act 1901 (Cth). Section 34AAB of the Acts Interpretation Act 1901 (Cth). See Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 449-450 [176]-[179]. (2010) 243 CLR 319. (2013) 252 CLR 336. (2013) 251 CLR 322. (2016) 259 CLR 180. Gleeson whether it is in the public interest to substitute a more favourable decision – is either to think that it is in the public interest to substitute a more favourable decision and to do so, or not to so think and not to do so. The procedural decision, no less than the substantive decision, involves "a discretionary value judgment to be made by reference to undefined factual matters, confined only in so far as the subject matter and the scope and purpose of the statutory enactments may enable given reasons to be pronounced definitely extraneous to any object the legislature could have had in view"13. The power is not further divisible. A procedural decision made personally by the Minister to consider making a substantive public interest decision is an exercise of the power conferred by s 351(1). Likewise, a procedural decision made personally by the Minister not to consider making a substantive public interest decision is an exercise of the same statutory power. Within the meaning of the Act, each is a "privative clause decision" made under s 351(1)14. For the avoidance of doubt, s 474(7) spells that out. Within the meaning of the Act, each is therefore also a "migration decision"15. The Minister is not limited to exercising the power conferred by s 351(1) to make a procedural decision – to consider or not to consider making a substantive public interest decision – only in an individual case. The Minister can exercise the statutory power to make a procedural decision in a specified class of case and can do so in advance of a case arising within that class. Thus, the Minister can exercise the power conferred by s 351(1) to make a procedural decision to the effect that "I will consider making a substantive public interest decision in any case that has the following characteristics ... but I will not consider making a substantive public interest decision in any case that has the following characteristics ...". For example, the Minister could exercise the power conferred by s 351(1) to make a procedural decision not to consider making a substantive public interest decision in any case which does not meet objective criteria specified by the Minister. The Minister could exercise the statutory power to make a procedural decision not to consider making a substantive public interest decision in any case where the Department has received a request for the exercise of the power which is not supported by information which a departmental officer assesses to bring the 13 Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 648 [30] (cleaned up); Plaintiff M79/2012 v Minister for Immigration and Citizenship (2013) 252 CLR 336 at 353 [39], 377 [127]. 14 See s 474(2) and (3)(g) of the Act. 15 See s 5(1) of the Act. Gleeson case within a class which the Minister has indicated to be a class in which the Minister wishes to consider making a substantive public interest decision16. But the power conferred by s 351(1) to make the procedural decision not to consider making a substantive decision in a class of case is not unbounded. The power is bounded by the exclusivity which s 351(3) attaches to the totality of the power which s 351(1) confers on the Minister and which s 351(3) attaches in particular to the assessment of the public interest. Plainly, it would not be open to the Minister to decide not to consider making a substantive decision in a class of case defined by reference to whether a departmental officer or any other person might think it to be not in the public interest to substitute a more favourable decision for a decision of the Tribunal. For the Minister to do so would be for the Minister to abdicate to that other person the core aspect of the substantive decision- making power under s 351(1) which s 351(3) makes clear can be exercised by no one but the Minister. Being under no obligation to exercise the statutory power to make a procedural decision at all, however, the Minister can choose to make no procedural decision one way or the other under s 351(1). The Minister can instead choose to exercise executive power, involving the Minister acting in "a capacity which is neither a statutory nor a prerogative capacity"17, to give a non-statutory instruction to officers of the Department administered by the Minister under s 64 of the Constitution as to the occasions, if any, on which the Minister wishes to be put in a position to consider making a procedural decision. Thus, the Minister can exercise executive power to give a non-statutory instruction to departmental officers to the effect that "I wish to be put in a position to consider making a procedural decision in any case that has the following characteristics ... but I do not wish to be put in a position to consider making a procedural decision in any case that has the following characteristics ...". That was found to be the effect of the 2009 Ministerial Instructions in Plaintiff S10/201118 as explained in SZSSJ19 16 cf Raikua v Minister for Immigration and Multicultural and Indigenous Affairs (2007) 158 FCR 510 at 512 [9], 522 [62]-[63]. 17 Davis v The Commonwealth (1988) 166 CLR 79 at 108. See Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 97 [132]- (2012) 246 CLR 636 at 653 [46], 665 [91]. See also Bedlington v Chong (1998) 87 FCR 75 at 80. (2016) 259 CLR 180 at 198-200 [46]-[54]. Gleeson and has been found to be the effect of the 2016 Ministerial Instructions by the Full Court in an unchallenged aspect of the decision under appeal20. In Plaintiff S10/2011, the only question raised in relation to departmental decisions made in purported compliance with the 2009 Ministerial Instructions was whether the making of those decisions was conditioned by a requirement of procedural fairness. The answer was that those decisions were not so conditioned. Not raised in Plaintiff S10/2011, but squarely raised in each of the present appeals, is whether the permissible scope of such a non-statutory instruction is itself bounded by the exclusivity which s 351(3) attaches to the power which s 351(1) confers on the Minister. For reasons now to be explained, it is so bounded. The statutory power limits the exercise of executive power The unanimous reasons for judgment of this Court in Brown v West21 contain the following statement of constitutional principle: "Whatever the scope of the executive power of the Commonwealth might otherwise be, it is susceptible of control by statute. A valid law of the Commonwealth may so limit or impose conditions on the exercise of the executive power that acts which would otherwise be supported by the executive power fall outside its scope." The principle is central to the relationship between the Commonwealth Parliament and the Executive Government of the Commonwealth within the system of representative and responsible government established by Chs I and II of the Constitution22. The principle was applied in Brown v West to hold that a "necessary implication" of the statutory fixing of the expenditure able to be incurred by a parliamentarian using a postal credit card was to deny the existence of executive power to increase the level of expenditure23. The principle is applicable here. 20 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 31 [23]-[24], 38 [54]-[55], 48 [87], 81 [264], 85 [283]- (1990) 169 CLR 195 at 202. 22 See Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 93 [121]-[122]. (1990) 169 CLR 195 at 205. Gleeson Section 64 of the Constitution requires that Ministers be appointed to administer departments, although it permits several Ministers to be appointed to administer the one department24. Section 67 of the Constitution makes clear that departmental officers, like Ministers, are "officers of the Executive Government of the Commonwealth"25. The relationship between a Minister and the department administered by the Minister which can ordinarily be taken to be contemplated by the Parliament when conferring a discretionary statutory power on a Minister is that described by Brennan J in Minister for Aboriginal Affairs v Peko-Wallsend Ltd26: "The Department does not have to draw the Minister's attention to every communication it receives and to every fact its officers know. Part of a Department's function is to undertake an analysis, evaluation and précis of material to which the Minister is bound to have regard or to which the Minister may wish to have regard in making decisions. The press of ministerial business necessitates efficient performance of that departmental function. The consequence of supplying a departmental analysis, evaluation and précis is, of course, that the Minister's appreciation of a case depends to a great extent upon the appreciation made by his Department. Reliance on the departmental appreciation is not tantamount to an impermissible delegation of ministerial function. A Minister may retain his power to make a decision while relying on his Department to draw his attention to the salient facts. But if his Department fails to do so, and the validity of the Minister's decision depends upon his having had regard to the salient facts, his ignorance of the facts does not protect the decision. The Parliament can be taken to intend that the Minister will retain control of the process of decision-making while being assisted to make the decision by departmental analysis, evaluation and précis of the material relevant to that decision." When conferring on a Minister a discretionary statutory power unaccompanied by any duty to consider its exercise, the Parliament can ordinarily be taken to contemplate that the Minister will be able to task the department administered by that Minister with sorting the wheat from the chaff so as to bring to the personal attention of the Minister only those requests for exercises of discretionary statutory powers which departmental officers assess to warrant the 24 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 403 [17], 415 [65], 459-460 25 See Comcare v Banerji (2019) 267 CLR 373 at 409-412 [56]-[65]. (1986) 162 CLR 24 at 65-66. Gleeson Minister's personal consideration. The Parliament can be taken to contemplate that, in undertaking such assessments, departmental officers will comply with instructions issued by or under the authority of the Minister or the Secretary of the department27. All of this accords with the general observation that "when a Minister is entrusted with administrative functions he may, in general, act through a duly authorized officer of his department"28. The "underlying principle" throughout is that "where a power or function is conferred on a Minister, in circumstances where, given administrative necessity, Parliament cannot have intended the Minister to exercise the power or function personally, an implied power of delegation (or agency) may be inferred"29. But the availability of such an inference must ultimately depend on the precise statutory scheme. The sections of the Act which are expressed to confer powers capable of being exercised in the public interest, if at all, only personally by a Minister are obviously designed to cut across the ordinary relationship between a Minister and the department administered by that Minister. The sections cut both ways. They confine to a Minister (as distinct from the department administered by that Minister) any decision to exercise such a power in the public interest. They also confine to a Minister (as distinct from the department administered by that Minister) any decision not to exercise such a power in the public interest. In enacting s 351 of the Act, the Parliament has seen fit to entrust to the Minister alone the evaluation of the public interest in substituting a more favourable decision for a decision of the Tribunal. A necessary implication of the exclusivity imposed by s 351(3) on the power which s 351(1) confers on the Minister is to deny the existence of executive power to entrust the dispositive evaluation of the public interest in substituting a more favourable decision to an executive officer other than the Minister. Put another way, the extension by s 61 of the Constitution of the executive power of the Commonwealth to "the execution and maintenance ... of the laws of 27 See s 57 of the Public Service Act 1999 (Cth). 28 Minister for Immigration and Border Protection v EFX17 (2021) 271 CLR 112 at 128 [33], quoting O'Reilly v State Bank of Victoria Commissioners (1982) 153 CLR 1 at 11 discussing Carltona Ltd v Commissioners of Works [1943] 2 All ER 560 at 29 New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (2014) 88 NSWLR 125 at 129 [12]. Gleeson the Commonwealth" does not authorise a Minister or any other officer of the Executive Government of the Commonwealth to undertake any non-statutory action that is expressly or impliedly excluded by a law of the Commonwealth. By confining evaluation of the public interest for the purpose of s 351(1) to the Minister personally, s 351(3) of the Act effects such an exclusion. Put yet another way, being limited by s 351(3) to exercising personally the power conferred by s 351(1) – to make a statutory decision as to whether or not to consider whether it is in the public interest to substitute a more favourable decision for a decision of the Tribunal and likewise to make a statutory decision as to whether it is or is not in the public interest to substitute a more favourable decision – the Minister cannot circumvent that statutory limitation through a purported exercise of executive power which gives conclusive effect to an anterior consideration of the public interest undertaken by a departmental officer outside, but for the purpose of, the statutory power. What s 351 prevents the Minister or a departmental officer from doing directly in the exercise of statutory power, it prevents the Minister or a departmental officer from doing indirectly in the exercise of executive power30. That is the statutory limitation on executive power which will be seen to be transgressed by the 2016 Ministerial Instructions and by the two impugned departmental decisions made in purported compliance with the 2016 Ministerial Instructions. The 2016 Ministerial Instructions The 2016 Ministerial Instructions were not expressed with statutory precision. But their import was tolerably clear. In relation to "first requests" for exercises of the power conferred by s 351(1), the Minister instructed in section 10.1 of the 2016 Ministerial Instructions that he wished to be put into a position to consider making a procedural decision only in cases assessed by the Department to have unique or exceptional circumstances. Cases assessed by the Department not to have unique or exceptional circumstances were to be "finalised" by the Department without referral to the Minister. In relation to "repeat requests" for exercises of the power conferred by s 351(1), the Minister instructed in section 10.2 of the 2016 Ministerial 30 Wragg v New South Wales (1953) 88 CLR 353 at 387-388; Caltex Oil (Australia) Pty Ltd v Best (1990) 170 CLR 516 at 522-523; Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 305. Gleeson Instructions that he wished to be put into a position to consider making a procedural decision only if the Department was satisfied of a significant change in circumstances raising new substantive issues and then only if the Department assessed those new substantive issues to have unique or exceptional circumstances. that description Unique or exceptional circumstances were described non-exhaustively in section 4 of the 2016 Ministerial Instructions. Examples there given of included: "strong compassionate circumstances meeting circumstances that if not recognised would result in serious, ongoing and irreversible harm and continuing hardship to an Australian citizen or an Australian family unit, where at least one member of the family is an Australian citizen or Australian permanent resident"; "compassionate circumstances regarding the age and/or health and/or psychological state of the person that if not recognised would result in serious, ongoing and irreversible harm and continuing hardship to the person"; "exceptional economic, scientific, cultural or other benefit would result from the person being permitted to remain in Australia"; and "circumstances [in which] the application of relevant legislation leads to unfair or unreasonable results in a particular case". Other sections of the 2016 Ministerial Instructions stressed that it was for the Minister under the Act to determine what was and was not in the public interest and made clear that the Minister might "consider intervening in cases where the circumstances do not fall within the unique or exceptional circumstances as described in section 4". No doubt, it is possible to imagine cases in which the Minister might think it to be in the public interest to substitute a more favourable decision than that of the Tribunal which would not fall within an example in section 4 of the 2016 Ministerial Instructions and which would not meet its more general description of unique or exceptional circumstances. However, it is impossible to avoid the conclusion that the concept of unique or exceptional circumstances was used in the 2016 Ministerial Instructions as an approximation of the public interest. By instructing that those cases assessed by the Department not to have unique or exceptional circumstances were to be finalised by the Department without referral, the Minister purported to entrust the dispositive evaluation of the public interest to departmental officers. The Minister thereby exceeded the statutory limit on executive power imposed by s 351(3). The same problem did not arise in relation to the treatment of first requests in accordance with the 2009 Ministerial Instructions. As Griffiths J pointed out in Gleeson the Full Court31, the 2009 Ministerial Instructions instructed that first requests were in all cases to be brought to the attention of the Minister. In the case of a first request assessed by them to have unique or exceptional circumstances, departmental officers were instructed to "bring the case to my attention in a submission so that I may consider exercising my power". In the case of a first request assessed by them not to have unique or exceptional circumstances, departmental officers were instructed to "bring the case to my attention through a short summary of the issues in schedule format, so that I may indicate whether I wish to consider the exercise of my power". Whether the same problem arose in relation to the treatment of repeat requests in accordance with the 2009 Ministerial Instructions was touched on in the present appeals in the context of an argument put by the first respondents that the 2016 Ministerial Instructions were sufficiently similar to the 2009 Ministerial Instructions for the second ground of appeal to be taken to be foreclosed by Plaintiff S10/2011. The 2009 Ministerial Instructions instructed that a repeat request was ordinarily to be dealt with by the Department replying that the Minister did not wish to consider exercising power but that a repeat request might be referred to the Minister where the Department was satisfied that there had been a significant change in circumstances which raised new substantive issues not previously provided to and considered by the Minister and which, in the "opinion" of the Department, fell "within the ambit" of unique or exceptional circumstances. If it were necessary to consider the manner in which repeat requests were dealt with under the 2009 Ministerial Instructions in more detail, much would turn on the understanding in practice of the nature of the opinion to be formed. If the understanding was that the departmental officers were to form and act on their own opinions as to whether there were unique or exceptional circumstances, the same problem may well have arisen. If the understanding was that departmental officers were to form and act on opinions as to whether there was a basis upon which the Minister might think that there were unique or exceptional circumstances, the problem would not have arisen. Whether the same problem arose in relation to the treatment of repeat requests in accordance with the 2009 Ministerial Instructions, however, is simply not an issue which arises in these appeals. Even if the instructions in the 2009 Ministerial Instructions in relation to repeat requests had been interpreted and applied in the same way as instructions in the 2016 Ministerial Instructions, Plaintiff S10/2011 would not assist the first respondents. No issue was raised in 31 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 49-50 [94]. Gleeson that case as to whether the 2009 Ministerial Instructions or their implementation infringed a statutory limitation on executive power. Nothing said in any of the reasons for judgment in this Court was directed to such an issue. Plaintiff S10/2011 is not authority for what it did not decide32. Mr Davis is a citizen of the United Kingdom. He arrived in Australia in 1997 on a working holiday visa. He applied for a partner visa. Afterwards, he remained in Australia under the mistaken belief that he had been granted permanent residency. He became aware that he did not hold a current visa only in 2014, following which he was granted first a tourist visa (which expired) and then a working visa (which was cancelled after he ceased employment with the sponsoring employer). In the meantime, he applied again for a partner visa. His application was refused by a delegate of the Minister. The decision of the delegate was affirmed on review by the Tribunal in 2019. On 11 February 2019, Mr Davis requested an exercise of power under s 351 of the Act to substitute a more favourable decision for that of the Tribunal. In purported compliance with section 10.1 of the 2016 Ministerial Instructions, an Assistant Director of the Department of Home Affairs on 8 May 2019 assessed Mr Davis' case not to have unique or exceptional circumstances and two days later notified him that his request was finalised without referral to the Minister. On 15 May 2019, Mr Davis complained to the Department about how his request had been dealt with. Treating the complaint as a repeat request, the Assistant Director assessed it in purported compliance with section 10.2 of the 2016 Ministerial Instructions and on 20 May 2019 notified him that it too was finalised without referral to the Minister. Mr Davis then applied to the Federal Court for judicial review of the Assistant Director's decision of 8 May 2019 on grounds which included legal unreasonableness. The application was dismissed at instance by O'Callaghan J33. first 32 See CSR Ltd v Eddy (2005) 226 CLR 1 at 11 [13]. 33 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCA 791. Gleeson On his appeal to the Full Court, Mr Davis sought leave to raise a ground of appeal substantially to the effect of the second ground now raised in the appeal to this Court. The Full Court, by majority, refused that leave34. On 12 May 2022, Gageler and Steward JJ granted special leave to appeal on both grounds. DCM20 DCM20 is a citizen of Fiji. She arrived in Australia in the early 1990s. She has lived here continuously since. DCM20 initially applied for a protection visa. That application was refused by a delegate of the Minister. The decision of the delegate was affirmed on review by the then Refugee Review Tribunal in 1996. She requested an exercise of power to substitute a more favourable decision under s 417 of the Act. The Minister then administering the Act personally decided not to exercise that power in 1997. DCM20 then applied for a resolution of status visa. Much later, that application was refused by a delegate of the Minister, whose decision was affirmed on review by the then Migration Review Tribunal in 2013. She requested an exercise of power to substitute a more favourable decision under s 351 of the Act. On 17 March 2016, an Assistant Minister then administering that section personally decided not to consider the exercise of that power. On 22 June 2016, DCM20 again requested an exercise of power under s 351 of the Act with respect to the same decision of the Migration Review Tribunal. That further request was assessed by an Assistant Director of the Department of Immigration and Border Protection in purported compliance with section 10.2 of the 2016 Ministerial Instructions on 28 June 2016. The assessment resulted in DCM20 being notified that her repeat request had been finalised without referral to the Minister. On 20 December 2019, DCM20 yet again requested an exercise of power under s 351 of the Act with respect to the same decision of the Migration Review Tribunal. This time, the request was assessed by an Assistant Director of the Department of Home Affairs in purported compliance with section 10.2 of the 2016 Ministerial Instructions on 10 January 2020. The result was DCM20 again 34 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 37 [47], 38 [54], 54 [114(b)], 95 [330]-[332], see contra at 56 [124]. Gleeson being notified that her repeat request had been finalised without referral to the Minister. DCM20 then applied to the Federal Court for judicial review of the Assistant Director's decision of 10 January 2020 on grounds including legal unreasonableness. The application was dismissed at first instance by Perry J35. DCM20's appeal to the Full Court was heard and determined concurrently with that of Mr Davis. Unlike Mr Davis, DCM20 did not seek leave to raise any new ground of appeal. DCM20 subsequently sought and, on 12 May 2022, was granted by Gageler and Steward JJ special leave to appeal solely on the ground of unreasonableness. In the course of the hearing of her appeal, she applied to amend her notice of appeal to add a second ground mirroring that on which Mr Davis had already been granted special leave to appeal. The Court reserved its decision on that application. There being no forensic prejudice to the respondents, leave to amend the notice of appeal should be granted and the earlier grant of special leave to appeal should be varied to include the additional ground. Jurisdiction, standing and declaratory relief By their originating applications to the Federal Court, Mr Davis and DCM20 each claimed, amongst other relief, a writ of prohibition or an injunction against one or more officers of the Commonwealth. There being no suggestion that those claims for relief were incapable of legal argument36, the matter to which each application related was within the original jurisdiction conferred on the Federal Court by s 39B(1) of the Judiciary Act 1903 (Cth). At first instance and on appeal in the Federal Court, Mr Davis and DCM20 challenged only decisions made in the purported exercise of executive power. The same is true of their appeals to this Court. Neither ground of appeal in either matter challenges or relies on any decision or purported decision made, or proposed or required to be made, under the Act. Neither ground of appeal can therefore be characterised as "in relation to a migration decision" so as to be excluded from the jurisdiction of the Federal Court by s 476A(1) of the Act. It follows that neither 35 DCM20 v Secretary, Department of Home Affairs [2020] FCA 1022. 36 Citta Hobart Pty Ltd v Cawthorn (2022) 96 ALJR 476 at 486-487 [35]-[36]; 400 ALR 1 at 10. Gleeson ground of appeal is derivatively excluded from the appellate jurisdiction of this Court under s 73 of the Constitution. Section 37 of the Judiciary Act confirms the power of this Court, in the exercise of its appellate jurisdiction under s 73 of the Constitution, to "give such judgment as ought to have been given in the first instance". The relief now sought from this Court in relation to the second ground of appeal does not go beyond the making of a declaration of right. Whether relief by way of a writ of prohibition or an injunction might also have been available and appropriate need not be considered37. Section 21(1) of the Federal Court of Australia Act 1976 (Cth) empowers the Federal Court to, "in civil proceedings in relation to a matter in which it has original jurisdiction, make binding declarations of right, whether or not any consequential relief is or could be claimed". "It is neither possible nor desirable to fetter" the power to grant such declaratory relief "by laying down rules as to the manner of its exercise"38. Declarations appropriate to reflect the disposition of the second ground of each appeal are to the effect that the impugned departmental decisions made in purported compliance with sections 10.1 and 10.2 of the 2016 Ministerial Instructions exceeded the executive power of the Commonwealth. Being declarations that conduct found to have been engaged in by executive officers exceeded a legal limit on executive power, they are by definition declarations of right39 and are unquestionably appropriate to be made in the exercise of judicial power40. 37 cf Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at 25 [42]; In re K L Tractors Ltd (1961) 106 CLR 318 at 338. 38 Forster v Jododex Australia Pty Ltd (1972) 127 CLR 421 at 437; see also Sankey v Whitlam (1978) 142 CLR 1 at 20, 23; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581-582. 39 See Colonial Sugar Refining Co Ltd v Attorney-General (Cth) (1912) 15 CLR 182 at 193; Croome v Tasmania (1997) 191 CLR 119 at 126, 132-133; Egan v Willis (1998) 195 CLR 424 at 439 [5]. 40 Victoria v The Commonwealth and Hayden (1975) 134 CLR 338 at 379-380; Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 35-36; Enfield City Corporation v Development Assessment Commission (2000) 199 CLR 135 at 157 Gleeson Each of Mr Davis and DCM20 has a "sufficient material interest"41 to seek such a declaration in relation to the particular decision which he or she impugns. That is so notwithstanding that neither has a legal right or legally protected interest which would be vindicated by the declaration42 and that neither had an interest which attracted any obligation of procedural fairness in the process which resulted in the making of the impugned decision43. The sufficiency of their respective interests arises from the fact that it would follow from the declaration of right that their request for an exercise of the power conferred by s 351(1) of the Act is yet lawfully to be finalised. It could not be said that the declaration would produce no foreseeable consequences for the ministerial and departmental respondents or for them. Orders The orders appropriate to be made in the appeal by Mr Davis are: Grant leave to the appellant to file an Amended Notice of Appeal. Appeal allowed. Set aside the orders made by the Full Court of the Federal Court of Australia on 23 November 2021 (as varied by the orders of 15 December 2021) and in their place make the following orders: (a) Appeal allowed. [56]; Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 41 British Medical Association v The Commonwealth (1949) 79 CLR 201 at 257. 42 Hobart International Airport Pty Ltd v Clarence City Council (2022) 96 ALJR 234 at 253 [64]-[65]; 399 ALR 214 at 233. See also Edwards v Santos Ltd (2011) 242 CLR 421 at 436 [37]; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 373 43 See Griffith University v Tang (2005) 221 CLR 99 at 117-118 [45], quoting Botany Bay City Council v Minister of State for Transport and Regional Development (1996) 66 FCR 537 at 568. Compare Kioa v West (1985) 159 CLR 550 at 621-622; Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 Gleeson Set aside the orders made by O'Callaghan J on 9 June 2020 and in their place make the following orders: Declare that the decision made by the third respondent in purported compliance with on 8 May 2019 section 10.1 of the 2016 Ministerial Instructions exceeded the executive power of the Commonwealth. The first respondent pay the costs of the applicant. The first respondent pay the costs of the appellant. The first respondent pay the costs of the appellant. The orders appropriate to be made in the appeal by DCM20 are: Grant leave to the appellant to file an Amended Notice of Appeal and vary the grant of special leave to appeal accordingly. Appeal allowed. Set aside the orders made by the Full Court of the Federal Court of Australia on 23 November 2021 (as varied by the orders of 15 December 2021) and in their place make the following orders: (a) Appeal allowed. Set aside the orders made by Perry J on 20 July 2020 and in their place make the following orders: Declare that the decision made by the second respondent on 10 January 2020 in purported compliance with section 10.2 of the 2016 Ministerial Instructions exceeded the executive power of the Commonwealth. The first respondent pay the costs of the applicant. The first respondent pay the costs of the appellant. The first respondent pay the costs of the appellant. GORDON J. These appeals touch upon some basic principles concerning the executive power of the Commonwealth. The appeals are to be decided by reference to only one of those principles: that the executive power of the Commonwealth is susceptible of control by statute44. For the reasons given by Kiefel CJ, Gageler and Gleeson JJ45, s 351 of the Migration Act 1958 (Cth) requires that the decisions to exercise or not to exercise the power given by that section may be made only by the Minister. Neither a decision to exercise the power, nor a decision not to exercise the power, may be made by an official in the department administered by a Minister (or any other person). I agree with the orders proposed by Kiefel CJ, Gageler and Gleeson JJ. I write separately to make the point that it is always necessary first to identify the source of a power which is said to be executive power. It is not sufficient is "non-statutory executive power" or "common law executive power". Each phrase assumes but does not demonstrate the existence of the asserted power. the power to state that Constitutional structure The Constitution constitutes the Commonwealth of Australia; it creates "one indissoluble Federal Commonwealth under the Crown ... and under the Constitution" (preamble). The Commonwealth is a legal or juristic person46, although that label may have a different meaning in respect of the Commonwealth compared to when it is applied to a private corporation or a natural person47. The branches of the Commonwealth do not have a separate legal personality48. Rather, those branches are empowered under the Constitution to exercise certain powers of the Commonwealth. And in setting up the institutional arrangements for the exercise of the powers of the Commonwealth, the Constitution separates and limits those powers. What is significant is that each of the three chapters of the Constitution creating the three branches of the Commonwealth – Ch I (the Parliament), 44 Brown v West (1990) 169 CLR 195 at 202. See also Williams v The Commonwealth ("Williams [No 1]") (2012) 248 CLR 156 at 250 [195], 369 [579]; Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 93 [121]-[122], 96 [128], 158 [369], 158-159 [372]-[373]. 45 See reasons of Kiefel CJ, Gageler and Gleeson JJ at [14]-[15]. 46 Williams [No 1] (2012) 248 CLR 156 at 184 [21], 185 [23], 237 [154]. 47 See Williams [No 1] (2012) 248 CLR 156 at 193 [38]. 48 Williams [No 1] (2012) 248 CLR 156 at 184 [21], 237 [154]. Ch II (the Executive Government) and Ch III (the Judicature) – begins with a section which provides that the relevant power of the Commonwealth is vested in a particular organ of government. "The legislative power of the Commonwealth shall be vested in a Federal Parliament ..." (s 1); "The executive power of the Commonwealth is vested in the Queen and is exercisable by the Governor-General as the Queen's representative ..." (s 61); and "The judicial power of the Commonwealth shall be vested in [the High Court and such other courts as Parliament creates and/or invests with federal jurisdiction]" (s 71). None of the three chapters defines the power it is concerned with – legislative, executive or judicial. It is true that Ch I, addressing legislative power, gives very elaborate specification of subject matters but it does not tell you what legislative power is. It simply provides that there is power to make laws with respect to those subject matters. In Ch III, there are elaborate provisions about who can exercise the judicial power of the Commonwealth and in what circumstances, but there is no definition of the judicial power of the Commonwealth. Similarly, in Ch II, the sections do not define executive power. As will be explained, the chapter identifies the institutions that are entrusted with the exercise of executive power, and marks out the boundary of that executive power to be the execution and maintenance of the Constitution and the laws of the Commonwealth49. Critically, like Chs I and III, Ch II also limits the power it confers: "the extent it marks out cannot be exceeded"50. It is this structure that not only is consistent with, but points directly to, the need to identify the source of executive power. Executive power of the Commonwealth The Executive Government is a "creature[] of the Constitution" and "has no powers except such as are conferred by or under [the Constitution], expressly or by necessary implication" from the text and structure of the Constitution51. 49 The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd ("Wool Tops Case") (1922) 31 CLR 421 at 437; see also 431. See also Davis v The Commonwealth (1988) 166 CLR 79 at 92, 107; Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 55 [113], 87 [227], 89 [234]; Williams [No 1] (2012) 248 CLR 156 at 342 [483], 362 [560]. 50 Wool Tops Case (1922) 31 CLR 421 at 438. See also In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 264; Davis (1988) 166 CLR 79 at 111. 51 Wool Tops Case (1922) 31 CLR 421 at 453; see also 431, 437-438, 441. See also Barton v The Commonwealth (1974) 131 CLR 477 at 498; Victoria v The Hence, the first question is to ask, "does the Executive have the asserted power and, if so, how?"; not to ask what prevents the Executive from doing what it seeks to do. In some cases the source is constitutional – including some prerogatives52, nationhood53, emergency54, and ss 61 and 64, giving power to administer departments of State55. But otherwise, the source is statutory (and therefore, ultimately, also derived from the Constitution). As was held in R v Kirby; Ex parte Boilermakers' Society of Australia56: "[I]n very many cases the propriety of the exercise of a power by a given department does not depend upon whether, in its essential nature, the power is executive, legislative or judicial, but whether it has been specifically vested by the Constitution in that department, or whether it is properly incidental to the performance of the appropriate functions of the department into whose hands its exercise has been given." In Boilermakers, the concern about the separation of powers had its focus in Ch III but it was situated in a larger and fuller understanding of the separation of powers in the Australian context which is directly contrary to the implied premise the Commonwealth's submissions, which appeared to be that57 the Executive can do anything it wants (anything, or "substantially" anything, a natural person can do) unless some limit can be the Solicitor-General of Commonwealth and Hayden ("AAP Case") (1975) 134 CLR 338 at 362; Pape (2009) 238 CLR 1 at 23 [8(5)]; Williams [No 1] (2012) 248 CLR 156 at 362 [559]; Williams v The Commonwealth [No 2] (2014) 252 CLR 416 at 454-455 [24]-[25]; CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514 at 52 See Wool Tops Case (1922) 31 CLR 421 at 437-439; Barton (1974) 131 CLR 477 at 498; Davis (1988) 166 CLR 79 at 93; Cadia Holdings Pty Ltd v New South Wales (2010) 242 CLR 195 at 226 [86]; CPCF (2015) 255 CLR 514 at 538 [42]. 53 See Davis (1988) 166 CLR 79. 54 See Pape (2009) 238 CLR 1. 55 The source to contract to buy paperclips is to be found in s 61 because officers (Ministers) are appointed – and so conferred power – to administer departments of State under s 64 of the Constitution. (1956) 94 CLR 254 at 279 (emphasis added). That analysis in Boilermakers goes back to Victorian Stevedoring and General Contracting Co Pty Ltd v Dignan (1931) 46 CLR 73; see in particular at 89-93, 96-98. 57 See also Williams [No 2] (2014) 252 CLR 416 at 467 [76]. identified58. That is the wrong analysis. It starts at the wrong point. And it is contrary to what was held in Boilermakers and said in The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd ("the Wool Tops Case")59. The proper starting point for an inquiry about executive power is to identify the source of the asserted power, function or capacity in the grants of executive power in s 61 and the other provisions in Ch II of the Constitution60. Section 61 of the Constitution provides: "The executive power of the Commonwealth is vested in the Queen and is exercisable by the Governor-General as the Queen's representative, and extends to the execution and maintenance of this Constitution, and of the laws of the Commonwealth." (emphasis added) There are two points to be made about s 61 of the Constitution. It does not say "includes" but "extends because executive power in a written constitution creating a federal government of limited powers was historically and necessarily different from executive power in a unitary state with no single written constitution and with executive power centred in the monarchy61. to". The phrase had to be "extends And the "extends to" clause in s 61 should not be read as indicating the existence of a broad and undefined executive power. Rather, "extends to" is used in the sense of "adds to" and gives a certain range or scope to the executive power. Thus, s 61 contains both an addition and a limit62. The extension is "delimiting"63 in the sense that it adds to executive power the execution and maintenance of the Constitution and the laws of the Commonwealth but, at the same time, it gives a specific range, scope or magnitude to both the extension of executive power and 58 cf Gageler, "The Legitimate Scope of Judicial Review: The Prequel" (2006) 57 Admin Review 5; Perry, "The Crown's Administrative Powers" (2015) 131 Law Quarterly Review 652. (1922) 31 CLR 421 at 431-433, 437-439, 441, 453. See also CPCF (2015) 255 CLR 60 Wool Tops Case (1922) 31 CLR 421 at 438; CPCF (2015) 255 CLR 514 at 538 [42]. 61 See Wool Tops Case (1922) 31 CLR 421 at 439-440; Boilermakers (1956) 94 CLR 254 at 267-268; AAP Case (1975) 134 CLR 338 at 378-379; Williams [No 1] (2012) 248 CLR 156 at 363 [562]. 62 See Re Judiciary (1921) 29 CLR 257 at 264; Wool Tops Case (1922) 31 CLR 421 at 431, 438; Williams [No 1] (2012) 248 CLR 156 at 362 [560]. 63 Wool Tops Case (1922) 31 CLR 421 at 431, 444; see also 437-438. executive power more generally. As was said in Boilermakers, "[a] federal constitution must be rigid. The government it establishes must be one of defined powers; within those powers it must be paramount, but it must be incompetent to go beyond them"64. Put in different terms, executive power is subject to boundaries and, in the case of the extension under s 61, the boundary is the execution and maintenance of the Constitution and the laws of the Commonwealth65. As observed, the content of executive power in s 61 may be said to extend to some prerogative powers, appropriate to the Commonwealth, that were accorded to the Crown at common law66. Critically, however, as Williams v The Commonwealth67 and Williams v The Commonwealth [No 2]68 demonstrate, the determination of the ambit of the executive power of the Commonwealth cannot begin from a premise that it is the same as the ambit of British executive power at common law. For present purposes, it is appropriate to put prerogatives, nationhood and emergency to one side. Next, Ch II of the Constitution, headed "The Executive Government", was established to take from its inception the form of a responsible government69. Two ideas are central to the concept of responsible government – the Executive acts on the advice of its Ministers and the Ministers are responsible to the Parliament for the actions of the Executive70. So how is that addressed in the Constitution? (1956) 94 CLR 254 at 267 (emphasis added). See also Wool Tops Case (1922) 31 CLR 421 at 437-438, 458; Dignan (1931) 46 CLR 73 at 96-97. 65 See Wool Tops Case (1922) 31 CLR 421 at 438. See also AAP Case (1975) 134 CLR 338 at 378-379; Williams [No 1] (2012) 248 CLR 156 at 230 [130], 364 [564]. 66 CPCF (2015) 255 CLR 514 at 538 [42], citing Cadia Holdings (2010) 242 CLR 195 at 226 [86] and Williams [No 1] (2012) 248 CLR 156 at 227-228 [123]. (2012) 248 CLR 156. (2014) 252 CLR 416 at 469 [81], see generally 467-469 [76]-[83]. 69 Plaintiff M68 (2016) 257 CLR 42 at 92 [119]. 70 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129 at 147; Boilermakers (1956) 94 CLR 254 at 275; New South Wales v The Commonwealth ("the Seas and Submerged Lands Case") (1975) 135 CLR 337 at 364-365; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 135, 184-185; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 415 [63]-[64], 463 [217]; Comcare v Banerji (2019) 267 CLR 373 at 409-410 In addition to s 61, there are five provisions in Ch II about the institutions exercising executive power that are important. First, s 62 provides that there shall be a Federal Executive Council to advise the Governor-General in the government of the Commonwealth. Second, s 64 provides that there will be Ministers of State, who are members both of the Federal Executive Council and of Parliament: "The Governor-General may appoint officers to administer such departments of State of the Commonwealth as the Governor-General in Council may establish. Such officers shall hold office during the pleasure of the Governor-General. They shall be members of the Federal Executive Council, and shall be the Queen's Ministers of State for the Commonwealth. Ministers to sit in Parliament After the first general election no Minister of State shall hold office for a longer period than three months unless he is or becomes a senator or a member of the House of Representatives." (emphasis added) The requirement that Ministers are senators or members of the House of Representatives (or become so within three months of appointment) "provides the machinery by which a Minister is accountable to Parliament"71. Third, under s 65, Ministers shall hold such offices as the Parliament prescribes, or, in the absence of provision, as the Governor-General directs. Fourth, s 67 provides for the appointment of civil servants: "[u]ntil the Parliament otherwise provides, the appointment and removal of all other officers of the Executive Government of the Governor-General in Council". Fifth, under s 69, there will be the transfer of certain departments from the former colonies to the Commonwealth. the Commonwealth shall be vested As is clear, departments of State expressly form part of the institutions of Executive Government under the Constitution, as do the officers (Ministers) those departments72. Consequently, under s 61, appointed the executive power for the "execution and maintenance of this Constitution" to administer 71 Re Patterson (2001) 207 CLR 391 at 415 [64]. 72 See Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 70 [199]. includes a field of action for the administration of departments of State under s 64 of the Constitution73. There are also provisions in Chs I and III of the Constitution that directly concern executive power and mark out its relationship to legislative and judicial power. In Ch I of the Constitution, s 51(xxxix) provides: "The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: (xxxix) matters incidental to the execution of any power vested by this Constitution in the Parliament or in either House thereof, or in the Government of the Commonwealth, or in the Federal Judicature, or the Commonwealth." (emphasis added) in any department or officer of As was explained in Boilermakers74: "[The legislative power in s 51(xxxix)] takes the powers vested by the Constitution respectively in the three branches of government, that is to say by s 1, by s 61 and by s 71, and gives a power to make laws with respect to matters incidental to the execution of these various powers, and adds, apparently for the purposes of such provisions as ss 64 and 69, a reference to the powers vested in any department or officer of the Commonwealth." What s 51(xxxix) does – as Boilermakers recognised – is to provide legislative power in relation to matters incidental to the "execution of any power" vested by the Constitution "in any department or officer of the Commonwealth". It provides incidental legislative power to Parliament to make laws with respect to the two institutions of the Executive Government – or structures of the Executive Government – namely officers (Ministers) and departments that are established under s 64 of the Constitution. It allows not only for facilitation of executive power, but also for limitation of the manner and circumstances of its exercise, and so reflects the subordination of the Executive to Parliament75. And the Executive and the officers of the Commonwealth are always subject to the 73 Williams [No 1] (2012) 248 CLR 156 at 191 [34]. (1956) 94 CLR 254 at 269 (emphasis added). See also Plaintiff M68 (2016) 257 CLR 42 at 93 [122]. 75 Plaintiff M68 (2016) 257 CLR 42 at 93 [122]-[123]. entrenched jurisdiction of this Court under ss 75(iii)76 and 75(v)77 of the Constitution. Underlying all of these provisions – across Chs I, II and III of the Constitution – is the principle of government accountability: "the basic idea that the executive branch and its delegates must be answerable, and as a general principle justify their actions, to the public, the Parliament, the courts or any administrative agency"78. This is the idea underpinning the relationship between members of the public and the Executive Government, between the Executive Government and the Parliament, and between the Executive Government and the Judicature79. 76 The "Commonwealth" in s 75(iii) has been described as referring to the Executive Government of the Commonwealth, the purpose of s 75(iii) being "to ensure that the political organization called into existence under the name of the Commonwealth and armed with enumerated powers and authorities, limited by definition, fell in every way within a jurisdiction [which could be invoked]": Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 362-363; Plaintiff M68 (2016) 257 CLR 42 at 77 Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 35-36; Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at 24 [38]-[39]. See also Bank of NSW (1948) 76 CLR 1 at 363; Church of Scientology v Woodward (1982) 154 CLR 25 at 70; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 482-483 [5], 513-514 [103]-[104]; Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651 at 668-669 [45]-[46]; Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 580 [98]; Plaintiff M61/2010E v The Commonwealth (2010) 243 CLR 319 at 347 [57]-[59]; Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 204 [71], 206 [81]; MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441 at 463-464 [92]; 390 ALR 590 at 612. 78 MZAPC (2021) 95 ALJR 441 at 465 [98]; 390 ALR 590 at 614, quoting Boughey and Weeks, "Government Accountability as a 'Constitutional Value'", in Dixon (ed), Australian Constitutional Values (2018) 99 at 103. See also MZAPC (2021) 95 ALJR 441 at 463-464 [92]; 390 ALR 590 at 612, quoting French, "Administrative Law in Australia: Themes and Values Revisited", in Groves (ed), Modern Administrative Law in Australia: Concepts and Context (2014) 24 at 29. 79 MZAPC (2021) 95 ALJR 441 at 465 [98]-[99]; 390 ALR 590 at 614. It also reflects that the Constitution "is framed upon the assumption of the rule of law"80. While the precise meaning of the rule of law is often contested81, the irreducible meaning of the rule of law, about which there cannot be any debate, is "that Government should be under law, that the law should apply to and be observed by Government and its agencies, those given power in the community, just as it applies to the ordinary citizen"82. The "agreed beginning" for debates about the rule of law is "that State power must be exercised in accordance with promulgated, non-retrospective law made according to established procedures"83. Public power is not to be exercised in a way that is contrary to law, and, of no less significance, the Executive cannot itself authorise a breach of the law84. Executive power for the administration of departments and execution of laws One of the two limbs of executive power mentioned in s 61 is the execution and maintenance of the laws of the Commonwealth. The term "laws of the Commonwealth" is a reference to statute law85. The execution of laws means doing something authorised or required by those laws86. The function is characteristically performed by execution of statutory powers87; however, it also extends to doing things which are necessary or incidental to the execution and maintenance of a valid law of the Commonwealth 80 Plaintiff S157 (2003) 211 CLR 476 at 492 [31]. See also Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193; Graham (2017) 263 CLR 1 at 81 MZAPC (2021) 95 ALJR 441 at 463 [91]; 390 ALR 590 at 612. 82 MZAPC (2021) 95 ALJR 441 at 463 [91]; 390 ALR 590 at 612, quoting Stephen, "The Rule of Law" (2003) 22(2) Dialogue 8 at 8. See also Laws, The Constitutional Balance (2021) at 13, 15. 83 MZAPC (2021) 95 ALJR 441 at 463 [91]; 390 ALR 590 at 612, quoting Laws, The Constitutional Balance (2021) at 15. 84 MZAPC (2021) 95 ALJR 441 at 464 [96]; 390 ALR 590 at 613, citing A v Hayden (1984) 156 CLR 532 at 540. 85 Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 86 Australian Communist Party (1951) 83 CLR 1 at 230. 87 Davis (1988) 166 CLR 79 at 109. See also Williams [No 1] (2012) 248 CLR 156 at once that law has taken effect88. The latter field does not require express statutory authority, nor is it necessary to find an implied power in the statute89. In that sense, administrative action that is incidental to the execution of a law does not involve statutory power, but finds its source in – and is controlled by – the statute and s 61 of the Constitution. Incidental action is strictly ancillary90; the Executive "cannot change or add to the law; it can only execute it"91. In that respect, executive action is qualitatively different from legislative action92. There is no executive power or capacity to dispense with the operation of the general law – whether statute or common law93. This principle, as was said in A v Hayden94, "is fundamental to our law, though it seems sometimes to be forgotten when executive governments or their agencies are fettered or frustrated by laws which affect the fulfilment of their policies". The other of the two limbs of executive power mentioned in s 61 is the execution and maintenance of the Constitution. As explained, this limb includes an area of executive action necessary for the administration of departments of State under s 64 of the Constitution. But to describe it as non-statutory or common law is likely to distract and mislead. Its source is the Constitution – ss 61 and 64. Because only the Minister can exercise the powers given by s 351, it is not necessary to examine, in this case, what has come to be known as the Carltona principle95. Three points, however, should be made. First, I accept that, 88 Williams [No 1] (2012) 248 CLR 156 at 184 [22], citing R v Kidman (1915) 20 CLR 425 at 440-441 and Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 464. See also Williams [No 1] (2012) 248 CLR 156 at 191 [34]; CPCF (2015) 255 CLR 514 at 648 [484]. 89 Williams [No 1] (2012) 248 CLR 156 at 191 [34]. 90 See Kidman (1915) 20 CLR 425 at 440; Australian Communist Party (1951) 83 CLR 1 at 193; Shanahan v Scott (1957) 96 CLR 245 at 250. 91 Kidman (1915) 20 CLR 425 at 441. See also Plaintiff M68 (2016) 257 CLR 42 at 92 Williams [No 1] (2012) 248 CLR 156 at 187 [27]. 93 Plaintiff M68 (2016) 257 CLR 42 at 98 [136], 158-159 [372]-[373]. See also Kidman (1915) 20 CLR 425 at 441. (1984) 156 CLR 532 at 580. 95 Carltona Ltd v Commissioners of Works [1943] 2 All ER 560 at 563. as Brennan J explained in Minister for Aboriginal Affairs v Peko-Wallsend Ltd96, part of a department's function is to undertake an analysis, evaluation and précis of material to which a Minister is bound to have regard, or to which the Minister may wish to have regard, in making decisions. As Brennan J explained, the Minister may personally make a statutory decision while relying on the department's summary, provided the Minister does in fact have regard to all relevant considerations that condition the exercise of the power97. In such a case, the department is assisting the Minister; it is not exercising a power on the Minister's behalf. Second, however, it is an altogether different proposition (which I do not accept) that a Minister may ordinarily give the department administered by the Minister the task of deciding which requests for the exercise of discretionary statutory powers should be brought to the personal attention of the Minister by assessing which requests warrant the Minister's personal consideration. I do not accept that Parliament can ordinarily be taken to contemplate that this can or will be done. Prima facie, when Parliament confers a statutory power on a person, it intends that person to exercise the power98. Further, subject to a contrary intention, the conferral of a statutory discretion implies a duty to consider any application that is made for the exercise of power99. That said, I accept that there is a general principle that, "where a power or function is conferred on a Minister, in circumstances where, given administrative necessity, Parliament cannot have intended the Minister to exercise the power or function personally, an implied power of [agency] may be inferred"100. In these appeals, it was clear that s 351(1) did not permit such authorisation because Parliament expressly required under s 351(3) that the power – both its procedural and substantive limbs – be exercised personally. The plurality suggest that, were it not for s 351(3), that principle would have applied to the procedural limb of (1986) 162 CLR 24 at 65-66. 97 Peko-Wallsend (1986) 162 CLR 24 at 66. 98 Racecourse Co-operative Sugar Association Ltd v Attorney-General (Q) (1979) 142 CLR 460 at 481; Dainford Ltd v Smith (1985) 155 CLR 342 at 349. 99 Murphyores Incorporated Pty Ltd v The Commonwealth (1976) 136 CLR 1 at 17-18, referring to R v Anderson; Ex parte Ipec-Air Pty Ltd (1965) 113 CLR 177 at 189. 100 New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (2014) 88 NSWLR 125 at 129 [12]. See also O'Reilly v State Bank of Victoria Commissioners (1982) 153 CLR 1 at 11; Peko-Wallsend (1986) 162 CLR 24 at 38; Plaintiff M61 (2010) 243 CLR 319 at 350 [68]; Minister for Immigration and Border Protection v EFX17 (2021) 271 CLR 112 at 128 [33]. s 351(1), because Parliament can "ordinarily" be taken to permit a Minister entrusted with a non-compellable discretionary power to instruct departmental officials to sort through requests so as to bring to the Minister's attention only those that the officials assess to warrant the Minister's consideration. But these are not matters to be answered according to some broad and untethered assertion of what "ordinarily" Parliament can be taken to contemplate. Whether such an authorisation is possible will depend on the construction of the statute, in particular the nature, scope and purpose of the power, the consequences of its exercise, and its function under the statutory scheme101. Third, and finally, there is both a critical difference, and an important commonality, between officials assisting the Minister to exercise a power in the manner described by Brennan J in Peko-Wallsend, and officials permissibly acting under an authorisation to exercise the Minister's power under the statute. The critical difference is that in the first category the Minister exercises the statutory power whereas, in the second category, the official exercises the statutory power in the Minister's name (not some "non-statutory" power or capacity). The important commonality is that in both categories – whether the power is exercised by the Minister or by the official as the agent of the Minister – the power is subject to the enforceable limits that inhere in the statute. Ultimately, the Executive Government was and remains relevantly subordinated to the Parliament102. Put in different terms, "[w]hatever the scope of the executive power of the Commonwealth might otherwise be, it is susceptible of control by statute"103. Its scope must be identified with proper understanding of the "basal assumption of legislative predominance inherited from the United Kingdom" and the relationship between Chs I and II of the Constitution104. Where a statute conditions powers or functions by reference to the persons who can exercise them, the circumstances in which they can be exercised, and the purposes for which they can be exercised, there will not be any unconstrained executive power or function covering the same subject matter that is preserved105. 101 Peko-Wallsend (1986) 162 CLR 24 at 38. 102 Plaintiff M68 (2016) 257 CLR 42 at 93 [123]. 103 Plaintiff M68 (2016) 257 CLR 42 at 93 [122], quoting Brown (1990) 169 CLR 195 104 Williams [No 1] (2012) 248 CLR 156 at 232 [136]. 105 CPCF (2015) 255 CLR 514 at 538 [41]. If a statute regulates or controls how executive power is to be exercised, then the statute governs to the exclusion of any residual power106. Exercise of executive power under s 351 As has been stated, s 351 of the Migration Act requires that the decisions to exercise or not to exercise the power given by that section may be made only by the Minister. Neither a decision to exercise the power, nor a decision not to exercise the power, may be made by an official in the department administered by a Minister (or any other person). That is, s 351 excludes the capacity of another to decide that it is or is not in the public interest for the Minister to consider exercising the power or for the statutory power to be exercised. Aspects of the exercise of power under s 351 are worth restating. Section 351 is a conferral of statutory executive power on the Minister. The Minister does not have a duty to consider whether to exercise the power under s 351(1) in any circumstances107. This means the Minister cannot be compelled to consider whether to exercise the power. It must be recognised, however, that a Minister might put themselves in a position where they are committed to following a certain process and may become obliged to consider exercising the power108. A Minister can exercise the statutory power under s 351(1) to make a decision to consider or not to consider making the substantive decision under s 351 by reference to a specified class of case and can do so before a case within that class exists109. As the plurality state, the Minister could exercise the power conferred by s 351(1) to make a procedural decision to the effect that "I will consider making a substantive public interest decision in any case that has the following characteristics ... but I will not consider making a substantive public interest decision in any case that has the following characteristics ...". But the characteristics identified by the Minister must be objective and cannot be whether a departmental official or any other person might think it to be or not to be in the public interest to substitute a more favourable decision for that of the Tribunal. The exercise of the statutory power under s 351 is not unbounded. 106 CPCF (2015) 255 CLR 514 at 600-601 [279]. 107 Migration Act, s 351(7). 108 cf Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship (2013) 251 CLR 322 at 340-341 [24]-[26], 357-358 [88]-[91]. 109 Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 Thus, I do not accept that, because the Minister is under no obligation to exercise the statutory power to make a procedural decision at all110, the Minister can choose to make no procedural decision one way or the other under s 351(1) but give some "non-statutory" instruction to officials in the department administered by the Minister under s 64 of the Constitution as to the occasions, if any, on which the Minister wishes to be put in a position to consider making such a procedural decision. That statement, and the example that follows it, is too broad. First, the power to give an instruction in this context is derived from s 351 of the Migration Act and ss 61 and 64 of the Constitution111, not some "non-statutory" source. Second, s 351(1) encompasses two decisions (procedural and substantive), and, as the plurality state, the power is not further divisible. Third, the statement blurs the important distinction between a Minister exercising a statutory power personally (which the officials in the department implement) and officials giving advice or assistance to the Minister for the exercise of the power by the Minister. Fourth, and no less important, the instruction cannot purport to require or permit the officials to make a decision reposed in the Minister by s 351(1). The Minister may instruct officials to implement the Minister's procedural decision (by instructing the screening out of requests based on objective criteria) or the Minister may seek advice and assistance to enable the Minister to make a decision. In both cases, the processes undertaken by departmental officials are not and cannot be divorced from the statute112. 110 Migration Act, s 351(7). 111 See [88]-[90] above. 112 Plaintiff S10 (2012) 246 CLR 636 at 665 [92]-[93]. Edelman The real issues in these appeals The appeals before this Court are two of the hundreds of cases where, under the Migration Act 1958 (Cth), a delegate of the Minister administering that Act ("the Minister") had refused an application for a visa, that decision was affirmed by an administrative tribunal ("the Tribunal"), and the appellant requested that the Minister exercise a personal override power. These appeals concern the proper processes for the consideration and exercise of that personal override power. The personal override power relevant to these appeals allows the Minister to substitute a more favourable decision even if the Tribunal would not have had power to make that more favourable decision. The Minister is not required to consider whether to exercise that personal override power. In neither case currently before the Court did the Minister do so. The Minister did not do so because officials of the department of State responsible for administering the Act, exercising a discretion under guidelines provided by the Minister, chose not to refer the requests to the Minister for consideration. Since the Minister did not make any decision concerning the personal override power there was no ministerial decision about the exercise or non-exercise of the power that could be challenged. And since the Minister was not required to consider the exercise of the personal override power the Minister's lack of consideration could not be challenged. So the appellants each sought judicial review by challenging the actions of the departmental officials assisting the Minister. The appellants each asserted that the departmental officials had exercised executive power in an unreasonable way. Those challenges failed before each of the primary judges in the Federal Court of Australia113, who held that the actions of the officials were not legally unreasonable. Appeals to the Full Court of the Federal Court of Australia on the same ground were determined together and dismissed114. At first instance, in each case, the appellant's challenge based on unreasonableness proceeded on the assumption that when the departmental officials chose not to refer the requests to the Minister they were otherwise authorised to do so. But in the Full Court, Mr Davis sought leave to raise an anterior ground of appeal to the effect that the actions of the officials went beyond 113 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCA 791; DCM20 v Secretary, Department of Home Affairs [2020] FCA 1022. 114 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23. Edelman their authority. A majority of the Full Court refused leave for this point to be raised, although Mortimer J, rightly recognising the importance of the point, would have granted leave. Her Honour ultimately dismissed the appeals with fidelity to existing law. But she correctly, and presciently, recognised that the state of the law was "troubling" and was difficult to reconcile with principle115. In this Court, Mr Davis was granted special leave to raise this anterior ground and, during the oral hearing, DCM20 sought leave to raise the same ground of appeal by a variation of the basis for her grant of special leave to appeal. There is no prejudice to the respondents in a grant of leave. Leave should be granted to DCM20. In order to address the anterior ground, it is necessary to identify whether any "power" was exercised by the departmental officials. Some of the suggested formulations of that "power" resemble the bureaucratese of Sir Humphrey Appleby: a "procedural decision" by the officials to consider whether the Minister considered that he wished to consider the exercise of the "substantive power". Part of the difficulty with such formulations is the abuse of legal concepts by misdescribing a liberty to act as a power to act. The anterior ground should be expressed in terms that avoid this conflation. The issue should be expressed in simple language to be assessed as a matter of substance: did the departmental officials themselves exercise a liberty that is granted to the Minister personally? When expressed in this way the essence of the issue concerns the point at which departmental officials cross the line between two categories of conduct: (i) permissible advice and assistance to the Minister so that the Minister can personally exercise the Minister's own liberty as to whether or not to consider the request; and (ii) an impermissible exercise by the officials themselves of the Minister's personal liberty. In the application by departmental officials of the 2016 Ministerial Instructions relevant to these appeals, there is a fine line between category (i) conduct and category (ii) conduct. The reasons of Steward J the circumstances of these appeals as involving category (i). There is force in that view and, as Mortimer J correctly observed in her Honour's reasons in the Full Court in these appeals, it is a view that is consistent with the general tenor of past authority, including in this Court116. Ultimately, however, and contrary to the tenor of past treat 115 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 62 [155]. 116 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 62 [155]. Edelman authority, I consider that the circumstances of these two appeals involve category (ii). The following three examples illustrate the dividing line. First, suppose that the Minister, confronted by hundreds of requests seeking the exercise of a personal override power, issues an instruction to departmental officials that over a period of time the Minister does not wish to consider exercising the power in relation to any request at all. The implementation of that decision during that time by officials – following the Minister's instruction – involves only assistance. In every case, the exercise of the liberty, refusing to consider the request, has been made by the Minister and not by the officials. Secondly, suppose that the Minister instructs departmental officials that the Minister will consider all first applications but no repeat applications. Again, the implementation of that decision by officials involves no more than assisting the Minister to exercise the Minister's liberty to consider. The officials might sometimes have to exercise judgment as to whether a request is a repeat request. But in every case the exercise of the liberty to refuse to consider the requests has still been made by the Minister, not by the officials. Thirdly, suppose that the Minister instructs departmental officials that they should decide, in the public interest, which requests the Minister should consider, and that they should not refer those requests to the Minister if they decide that the Minister should not consider them. In this third example, the decision as to which requests the Minister should consider is now being made, in substance, by the departmental officials. Although it remains possible that in a rare case the Minister might be alerted to the request by a third party (such as the media) and might then exercise the liberty to consider the request, the earlier decision by the departmental officials remains, in substance, an exercise of the Minister's liberty. In my view, the circumstances of these appeals are akin to this third example. The past authority on this point, including decisions of this Court, has been premised upon an erroneous assumption, albeit with limited argument on the point. That assumption is that the actions of officials who implement guidelines of the Minister will always be characterised as the official merely assisting the Minister, rather than the official unlawfully exercising the Minister's personal liberty. Once that assumption is properly rejected, the circumstances of these appeals should be seen to involve, in substance, an unlawful exercise of the Minister's personal liberty by departmental officials. The appeals must therefore be allowed subject to one further issue. The further issue is that the Solicitor-General of the Commonwealth submitted that the appeals should nevertheless be dismissed because s 476A(1) of the Migration Act excluded the jurisdiction of the Federal Court (and therefore the jurisdiction of any courts considering appeals from decisions of the Federal Court) to adjudicate upon the authority of the departmental officials to make decisions. Edelman Section 476A(1) excludes the jurisdiction of the Federal Court in proceedings that concern decisions which are made, or which purport to be made, under the Migration Act. Since s 476A(1) is part of a scheme to exclude the jurisdiction of the courts, it is a provision that should be interpreted narrowly, consistently with reasonable expectations informed by deep common law values. So interpreted, s 476A(1) did not exclude the jurisdiction of the Federal Court in relation to the present matters because the unlawful actions of the departmental officials were not taken under the Migration Act and did not purport to be decisions made under the Act. Rather, they purported to be mere assistance to the Minister. Executive powers and liberties and judicial review "A loose vocabulary is a fruitful mother of evils."117 The issues in these appeals and past authority have been beset by loose vocabulary which has generated much confusion. That loose vocabulary concerns the notions of "executive power" and the "rights" which are the subject of judicial review. Executive power and the Constitution laws of the Commonwealth. The Constitution provides Section 61 of the Constitution vests the executive power of the Commonwealth in the Queen, exercisable by the Governor-General, and "extends" that executive power to the execution and maintenance of the Constitution and of the the Governor-General is advised by the Federal Executive Council and acts with that advice (ss 62, 63). It provides for the Governor-General to appoint Ministers to administer departments of State (s 64) and, subject to delegation or Commonwealth law, for the Governor-General in Council to appoint and remove all other officers of the Executive Government (s 67). But the Constitution does not define the "power" that the Governor-General, and hence Ministers, can exercise or delegate to others. that At a high level of generality, s 61 of the Constitution is the ultimate source of all Commonwealth executive "power". But to recognise the vesting of Commonwealth executive power by s 61 as the ultimate source of that "power" says nothing about the content of that vested "power" or how that content is to be identified. So too, s 61 contains no detail concerning the content of the power to which s 61 "extends" or the content of the matters the existence of which s 64 assumes for the administration of departments of State. In short, s 61 neither 117 Gray, "Some Definitions and Questions in Jurisprudence" (1892) 6 Harvard Law Review 21 at 21, quoted in Mann v Paterson Constructions Pty Ltd (2019) 267 CLR Edelman defines the concept of executive power nor explains the sources from which the content of that power can be identified118. The concept of executive power Perhaps the best known, and most widely accepted, legal and analytical meaning given to the term "power", which separates it from other forms of legal relation, is that it is the ability to effect a change in legal relations119. This is, "in general terms", the starting point for the meaning of executive power in s 61 of the Constitution120. But the executive power to which s 61 refers is both narrower and wider than the concept of "power" in this analytic sense. Executive power in s 61 is narrower than this analytic definition of power because it is confined to those actions which the law permits. Hence, as the Solicitor-General submitted, although an assault by an officer of the Executive would alter the legal rights of the person assaulted, and the consequent actions that they could bring, it is not an exercise of power that is contemplated by s 61. Executive power in s 61 is also wider than this analytic definition of power because it includes all other jural relations of the Executive, including claim rights, liberties or privileges, and immunities121. In Davis v The Commonwealth122, Brennan J referred to these other legal relations as "capacities" to distinguish them from "the Crown's powers" in the analytic sense described above. But, as Hohfeld observed, the term "capacity" is "unfortunate" and might not denote any legal relation at all123. "Capacity" has also sometimes been used interchangeably with 118 The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 437, 461. 119 Hohfeld, "Some Fundamental Legal Conceptions as Applied in Judicial Reasoning" (1913) 23 Yale Law Journal 16 at 44; American Law Institute, Restatement (First) of Property (1936), §3. See also Wade, Constitutional Fundamentals (1980) at 46. 120 See Griffith University v Tang (2005) 221 CLR 99 at 128 [80]. 121 Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 424, 438. See also Federal Commissioner of Taxation v Official Liquidator of E O Farley Ltd (1940) 63 CLR 278 at 321. 122 (1988) 166 CLR 79 at 108. See also In re K L Tractors Ltd (1961) 106 CLR 318 at 335; Hohfeld, "Some Fundamental Legal Conceptions as Applied in Judicial Reasoning" (1913) 23 Yale Law Journal 16 at 24. 123 Hohfeld, "Some Fundamental Legal Conceptions as Applied in Judicial Reasoning" (1913) 23 Yale Law Journal 16 at 45. Edelman other terms, including "permission"124, another word for which is a "liberty". On other occasions, "capacity", or "capacities and functions", has also been used in the context of s 61 of the Constitution to mean all legal relations: "rights, powers, privileges and immunities"125. Where "capacity" is used to refer to the general freedom of the Commonwealth Executive to act in a manner that does not affect the rights of others, the best description – to contrast it with the concept of a "power" in the sense of altering the legal relations of others – is a "liberty". For example, in Clough v Leahy126, Griffith CJ properly described as a "liberty" the ability of officials to obtain information on any topic. Importantly, and in contrast with a power in the sense of altering the legal relations of others, the exercise of such a liberty does not affect the legal relations of any other person. The sources of executive power Although the entirety of Commonwealth executive power (including executive liberty and other jural relations) is recognised in s 61 of the Constitution, s 61 does not distinguish between the different sources of executive power that it vests in the Governor-General. The sources might be: (i) Commonwealth legislation; (ii) express or implied powers or liberties in the Constitution itself; or (iii) what is loosely described as the "common law". These sources might overlap and are not a neat, mutually exclusive taxonomy. Constitutional executive power As s 61 provides, Commonwealth executive power extends to the execution and maintenance of the Constitution. This includes powers to execute and maintain the Constitution which are express in, and implied by, the terms and structure of the Constitution. For instance, Commonwealth executive power includes the express power, contained in s 68 of the Constitution, for the command in chief of the naval and military forces of the Commonwealth. Commonwealth executive power also includes the implied power that is part of nationhood127 and the power 124 Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 98 [135]. 125 Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 424. 126 (1904) 2 CLR 139 at 157. 127 Davis v The Commonwealth (1988) 166 CLR 79 at 110-111; Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 48-49 [92]. Edelman to respond to a national emergency128 (which may both be aspects of the same concept, expressed at different levels of generality). Statutory executive power Statutory executive power (in the sense that includes statutory liberties and other jural relations) might be expressly or impliedly conferred by a law of the Commonwealth under a primary head of power in the Constitution. It might also be conferred by laws made under s 51(xxxix) of the Constitution, which provides for legislative power in respect of matters incidental to the execution of Commonwealth executive power, including Commonwealth executive power to protect and safeguard matters that are authorised by a law of the Commonwealth129. By providing in s 61 that Commonwealth executive power "extends to" the execution and maintenance of the laws of the Commonwealth, the Constitution "marks the external boundaries of the Commonwealth executive power"130. "Common law" executive power: non-statutory prerogative and general powers and liberties "Common law" executive power, as it is commonly described, is subject to displacement by statute131. A determination of the scope of the "common law" executive power that is vested by s 61 of the Constitution is assisted by consideration of the common law powers that existed in British and colonial constitutional practice at the time of Federation132. The power of the British Crown included "the exercise of the discretionary authority ... by virtue of the common law without any express parliamentary 128 Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 89 [233]. See also Williams v The Commonwealth [No 2] (2014) 252 CLR 416 at 454 [23]. 129 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 230; Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 464. 130 The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 437. 131 Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 459; Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 69-70 [85]; Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 236 CLR 24 at 58 [27]. See also Attorney-General v De Keyser's Royal Hotel 132 Williams v The Commonwealth [No 2] (2014) 252 CLR 416 at 469 [81]. Edelman sanction or supervision"133. Some of those powers were described as prerogative powers of the Crown134. One view of prerogative powers, taken by Blackstone, is that a power is prerogative if it is one "which the king enjoys alone, in contradistinction to others"; if it were a power that were possessed by both king and subject, "it would cease to be prerogative any longer"135. An example of a prerogative power that is said to be "inherent in the Crown and in no one else" is the power to pardon a convicted criminal136. The prerogative powers are commonly considered to be common law powers because of a centuries-old understanding that prerogative powers are customs and practices recognised by the common law137. The presently fashionable view purports to draw a clear conceptual distinction between (i) "common law" prerogative powers and (ii) "common law", non-prerogative, "general administrative powers to carry on the ordinary business of government"138. On that view, the treatment of all powers of the Crown as prerogative was a matter upon which even writers as formidable as Coke139 or Dicey140 had nodded. The supposedly better view is that a common law non- prerogative power held by the Crown is one in respect of which there is a parity of 133 Halsbury's Laws of England, 1st ed, vol 6, para 579. 134 Farey v Burvett (1916) 21 CLR 433 at 452. See also Barton v The Commonwealth (1974) 131 CLR 477 at 498, 505. 135 Blackstone, Commentaries on the Laws of England (1765), bk 1, ch 7 at 232. 136 Wade, "Procedure and Prerogative in Public Law" (1985) 101 Law Quarterly Review 180 at 191. 137 Coke, The Third Part of the Institutes of the Laws of England (1644), ch 24 at 84, note 8. But cf Kershaw, "Revolutionary amnesia and the nature of prerogative power" (2022) 20 International Journal of Constitutional Law 1071. 138 R (New London College Ltd) v Secretary of State for the Home Department [2013] 1 WLR 2358 at 2371 [28]; [2013] 4 All ER 195 at 210. See also R (Hooper) v Secretary of State for Work and Pensions [2005] 1 WLR 1681 at 1695-1696 [46]-[47]; [2006] 1 All ER 487 at 506-507. 139 Coke, The First Part of the Institutes of the Laws of England, 3rd ed (1633), bk 2, ch 5, §125 at 90. 140 Dicey, Lectures Introductory to the Study of the Law of the Constitution (1885) at Edelman power with "an ordinary person", such as the power to convey land or chattels141. This picture of common law prerogative powers and common law non-prerogative powers may not be as neat as the presently fashionable view draws it, particularly where the Commonwealth Executive is concerned. There are three complications. First, the presently fashionable view does not usually distinguish between a power and a liberty. Serious errors can arise by conflating a liberty to act with a power to act. The conflation leads to erroneous reasoning that if a member of the Executive has the same liberties as a natural person this must mean that the member has the same powers to act, and thus the same abilities to affect the legal relations of others, as a natural person142. This reasoning is erroneous because, although a member of the Executive is not prohibited from (and thus has a liberty in respect of) "solving the Middle East crisis in a day" or "flying to Jupiter", that does not mean that the member has the power to do these things143. The absence of a prohibition upon action provides no justification for the existence of a power of the Commonwealth Executive. Indeed, to treat the absence of prohibition on action as giving rise to a power for the Commonwealth Executive to act could undercut the "distribution of powers and functions between the Commonwealth and the States"144 in a federation formed by the Constitution. Hence, in Williams v The Commonwealth145, the erroneous conflation of liberties and powers in the submissions of the Commonwealth parties146 was not accepted by this Court, and consequent analogies between the powers of a natural person and the powers of the Commonwealth Executive were repeatedly rejected147. 141 Wade, "Procedure and Prerogative in Public Law" (1985) 101 Law Quarterly Review 180 at 191. 142 Malone v Metropolitan Police Commissioner [1979] Ch 344 at 357. Compare Gageler, "The legitimate scope of judicial review: the prequel" (2006) 57 Admin Review 5 at 6. 143 Perry, "The Crown's Administrative Powers" (2015) 131 Law Quarterly Review 652 144 Williams v The Commonwealth [No 2] (2014) 252 CLR 416 at 469 [83]. 145 (2012) 248 CLR 156. 146 (2012) 248 CLR 156 at 165. 147 (2012) 248 CLR 156 at 193 [38], 237-239 [154]-[159], 253-255 [204]-[207], 259 [217], 352-353 [518]-[524]. See also Pape v Federal Commissioner of Taxation (2009) 238 CLR 1. Edelman Secondly, even if the focus is only upon liberties, there are difficulties in identifying those non-prerogative liberties in which there is parity between the Commonwealth Executive and a natural person. The difficulty lies in assuming that the Crown "as a corporation possessing legal personality" has "the same liberties as the individual"148 such that "that which is lawful to an individual can surely not be denied to the Crown"149. That reasoning ignores that "an act when performed by a government may assume a different significance from that performed by individuals"150. For instance, in Clough v Leahy151, Griffith CJ (with whom Barton and O'Connor JJ agreed) treated the liberty of the Commonwealth Executive to hold a Royal Commission of inquiry without coercive powers as a liberty in common with the liberty of a natural person to make any inquiry. But an inquiry takes on a different complexion when it is undertaken by the Executive rather than a natural person152. Hence, Dixon J later treated the "source" of the liberty for the Commonwealth Executive to issue a Royal Commission of inquiry as "the prerogative of the Crown"153. liberty of Whether a is properly characterised as one that is shared with a natural person generally or as a prerogative of the Commonwealth Executive might ultimately depend on the level of generality at which the liberty is described. Similarly to the contrived assumption in Clough v Leahy, it is only possible on these appeals to treat a liberty the Commonwealth Executive 148 R v Secretary of State for Health; Ex parte C [2000] 1 FLR 627 at 632, quoting Halsbury's Laws of England, 4th ed (1996 reissue), vol 8(2) at 94, para 101, note 6. See also R (on the application of Shrewsbury and Atcham Borough Council) v Secretary of State for Communities and Local Government [2008] 3 All ER 548 at 555-556 [21]. See further Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 60 [126]. 149 Clough v Leahy (1904) 2 CLR 139 at 157. See also Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 564, quoting Attorney-General v Guardian Newspapers Ltd [No 2] [1990] 1 AC 109 at 283. 150 Zines, "The inherent executive power of the Commonwealth" (2005) 16 Public Law Review 279 at 283-284, citing Winterton, Parliament, the Executive and the Governor-General (1983). See also Allen, Non-Statutory Executive Powers and Judicial Review (2022) at 43. 151 (1904) 2 CLR 139 at 157. 152 Victoria v Australian Building Construction Employees' and Builders Labourers' Federation (1982) 152 CLR 25 at 88-89. 153 McGuinness v Attorney-General (Vict) (1940) 63 CLR 73 at 93-94. Edelman of officers of the Commonwealth Executive to advise and assist a Minister as being common to a liberty held by a natural person generally if it is characterised at an artificially high level of generality: a liberty to advise and assist another person. Yet, just as the liberty to make an inquiry takes on a different complexion when it is undertaken by the Executive, the liberty to advise and assist a person takes on a different complexion when that person is a Minister and the advice and assistance concerns the exercise of executive power. Thirdly, whether or not the label "non-prerogative" is attached to the exercise of everyday general powers or liberties by the Commonwealth Executive by analogy with a natural person generally, it is at least misleading to describe those powers or liberties as having their source in the "common law". A better description of those powers and liberties might be as "non-statutory general powers and liberties". This reflects their source in the reasonable necessity for actions by officers of the executive arm of the Commonwealth polity to ensure the basic existence and functional operation of the polity – the essential functions "of the central government of a country in the world of to-day"154. The creation of the Commonwealth of Australia − as a political body corporate or "body politic"155 − necessarily entails the existence of powers that are "an essential attribute of this country as a sovereign nation"156 and thus the conferral of powers and liberties for basic functions. These powers and liberties for basic functions can be described as relating to "the ordinary course of administering a recognised part of the government"157. They might include the power to hire and fire staff who perform the basic functions of administration. They might include the power to enter contracts, or dispose of property, in relation to matters that are a core part of the functioning of executive government158. And they might include powers and liberties that are necessarily incidental to the execution of a statutory provision. This constitutional foundation for the existence of such non-statutory general powers and liberties for basic functions is consistent with the view of 154 Attorney-General (Vict) v The Commonwealth ("the Pharmaceutical Benefits Case") (1945) 71 CLR 237 at 269. 155 Hocking v Director-General, National Archives of Australia (2020) 271 CLR 1 at 87-88 [213]. See also New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 120 [194]. 156 Barton v The Commonwealth (1974) 131 CLR 477 at 505. 157 Sapienza, Judicial Review of Non-Statutory Executive Action (2020) at 37. 158 Hayne, "Executive Power" (2017) 28 Public Law Review 236 at 246. Edelman Isaacs J in R v Kidman159, where his Honour said − borrowing from Lord Selborne's discussion of the powers of the New South Wales Legislative Assembly160 − that the "mere creation" of the body politic involves the implied grant of "whatever, in a reasonable sense, was necessary for the purposes of its existence and the proper exercise of its functions". That implication is reinforced by the presupposition in ss 67, 70, 81, 84, 86 and 119 of the Constitution of the existence of an executive arm of the polity with the ability to function161, and particularly the assumption in s 64 of the Constitution that a Minister (officer of State) will have the power to administer that office of State. The exercise of ministerial executive power by delegates and agents Section 64 of the Constitution authorises the Governor-General to appoint officers, commonly known as Ministers, to administer the departments of State that are established. Those departments are sometimes vast, making it impossible for a Minister personally to exercise every executive power concerning the functions of that department. Subject to any express or implied statutory limitation, there are two ways that such power can sometimes be exercised other than by the Minister. The first, and common, way by which executive power can be exercised by officials of a department is pursuant to the principle, "based in part on administrative necessity", that the Minister can "act through a duly authorized officer of [the] department"162. This is sometimes referred to as the Carltona principle163. But it is no more than an application of the rules of agency. Where these rules of agency are applicable, the official acts on behalf of the Minister as the Minister's agent, not on the official's own behalf. The second way in which executive power can sometimes be exercised by officials of a department is through delegation, as that principle is properly called. A delegate is not an agent164. Rather, at common law a delegate exercises "power 159 (1915) 20 CLR 425 at 440. See also Williams v The Commonwealth [No 2] (2014) 252 CLR 416 at 467-468 [78]. 160 Barton v Taylor (1886) 11 App Cas 197 at 203. 161 See also Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 83 [214]. 162 Minister for Immigration and Border Protection v EFX17 (2021) 271 CLR 112 at 128 [33], quoting O'Reilly v State Bank of Victoria Commissioners (1982) 153 CLR 163 Carltona Ltd v Commissioners of Works [1943] 2 All ER 560 at 563. 164 Plaintiff M61/2010E v The Commonwealth (2010) 243 CLR 319 at 350 [68]. Edelman as their own", not subject to the delegator's control, with "their own independent discretion in the exercise of their delegated power"165. In Minister for Aboriginal Affairs v Peko-Wallsend Ltd166, Mason J (with whom Gibbs CJ and Dawson J agreed) said that the conferral by statute of a personal power on the Minister excluded the possibility of an implied power to act through an officer of the department as agent or an implied power to delegate to an officer of the department. But that does not preclude a departmental official from exercising their liberty to obtain information, or to advise or assist the Minister in the exercise of the Minister's power, including in the implementation of the exercise of a power or liberty by the Minister. There can, however, be a fine line between cases where the departmental officials' actions involve advice and assistance to the Minister to exercise the Minister's liberty or power and cases where the departmental officials' actions amount, in substance, to an exercise of the Minister's personal liberty or power itself. Where that fine line is drawn is at the heart of these appeals. Judicial review In Attorney-General (NSW) v Quin167, Brennan J said that judicial review "provides no remedies to protect interests, falling short of enforceable rights, which are apt to be affected by the lawful exercise of executive or administrative power". Different considerations arise where the plaintiff challenges the legality of an exercise of public power, or even the legality of an exercise of a public liberty, such as by an allegation that the public body has acted unlawfully and contrary to public duties or public freedoms168. A person's legal relations (rights, powers, privileges, and immunities) need not be affected for the person to have standing to challenge the authority or legality of such public action. But the person must have a sufficiently special interest169, 165 Northern Land Council v Quall (2020) 271 CLR 394 at 431 [83], quoting Commissioner of Inland Revenue v Chesterfields Preschools Ltd [2013] 2 NZLR 166 (1986) 162 CLR 24 at 37-39. See also at 30, 71. 167 (1990) 170 CLR 1 at 35. 168 Hobart International Airport Pty Ltd v Clarence City Council (2022) 96 ALJR 234 at 246-247 [33]-[34], 257-261 [84]-[99]; 399 ALR 214 at 224, 239-243. 169 Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27; Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA) (1995) 183 CLR 552; Edelman with "foreseeable consequences", over and above that of the general population arising from the legal relation that is the subject of the order sought170. It has been said that no rights are affected by, and there can be no judicial review of, an action by a departmental official, following ministerial instructions, not to refer to the Minister a request for consideration of the exercise of a personal statutory power of the Minister171. As an absolute proposition that is wrong. It is true that if such action involves a departmental official's lawful exercise of a liberty merely to advise and assist the Minister, not affecting the legal relations of any person, then no judicial remedy could be ordered. But if the departmental official's action is said to exceed the lawful liberty of officials to advise and assist the Minister, and to trespass (in substance) into an unlawful exercise of the Minister's personal liberty, then a person with a sufficiently special interest in the remedy sought can obtain a declaration as to the legality of that action. The ministerial powers and the Ministerial Instructions The Minister's personal override power Section 351(1) of the Migration Act confers a personal override power on the Minister. That sub-section, which follows a similar format to other personal override powers conferred on the Minister by the Migration Act172, permits the Minister − if the Minister "thinks that it is in the public interest to do so" − to override an administrative decision made under s 349 of the Migration Act and to substitute a decision that is more favourable to the applicant, even if the Tribunal had no power to make that more favourable decision. The personal override power in s 351(1) necessarily implies an ability for the Minister to consider the exercise of that power. But s 351(7) provides that the Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247; Hobart International Airport Pty Ltd v Clarence City Council (2022) 96 ALJR 234; 399 ALR 214. 170 Plaintiff M61/2010E v The Commonwealth (2010) 243 CLR 319 at 359 [103]. See also Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 527-528, 530-531, 537, 547-548; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 35-36, 41-42, 43, 44, 63, 78; Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA) (1995) 183 CLR 552 at 558; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 at 171 Raikua v Minister for Immigration and Multicultural and Indigenous Affairs (2007) 158 FCR 510 at 522 [64]. 172 See also ss 46A(2), 48B(1), 195A(2), 417(1), 501J(1). Edelman Minister does not have any "duty to consider whether to exercise the power under subsection (1) in respect of any decision, whether he or she is requested to do so by the applicant or by any other person, or in any other circumstances". In other words, the ability in s 351(1) for the Minister to consider whether to exercise the personal override power is a liberty to consider. It is not a duty. Section 351(3) provides that the power under s 351(1) must be exercised by the Minister personally. Two important concessions were properly made by the Solicitor-General on these appeals. First, the effect of s 351(3), in the context of the whole of s 351, is that both the personal override power and the liberty to consider whether to exercise that power are personal to the Minister. Secondly, the personal nature of both the power and the liberty means that neither can be exercised by either a delegate or an agent. It is, in theory, possible that issues might arise concerning the scope of the Minister's liberty to consider whether to exercise their personal override power. For instance, it might be said that the Minister's liberty is not exercised where the Minister makes no decision about whether or not to consider because the Minister carelessly forgets the existence of a request for intervention that has been provided. But these issues do not arise on these appeals. The fundamental question on these appeals is whether the departmental officials, in substance, exercised the Minister's personal liberty to consider exercising the override power. A longstanding practice of the Minister has been to create rules and principles that purport to inform departmental officials of the way in which they can advise or assist the Minister to exercise the Minister's personal liberty and personal override power173. Like other judgments in this Court, I refer to those rules and principles as Ministerial Instructions. But it is telling that this is not how they are described by the Minister: the heading that describes the instructions is "Guidelines". In some instances, the rules do purport to be instructions as to how to assist the Minister. But in the instances relevant to these appeals involving the 2016 document, the Minister did no more than provide "guidance" for the decision to be made. The Minister did not instruct the decision to be made. The "instructions" relevant to these appeals are the 2016 Ministerial Instructions. But it is necessary also to consider the 2009 Ministerial Instructions, which were relevant to the decisions of this Court relied upon by the Solicitor- General in these appeals. 173 See, eg, Raikua v Minister for Immigration and Multicultural and Indigenous Affairs (2007) 158 FCR 510 at 515-516 [25]-[26]. Edelman The 2009 Ministerial Instructions In 2009, the Minister issued instructions to the department in relation to the Minister's exercise of personal override powers under the Migration Act. The 2009 Ministerial Instructions were expressed to be a "policy instruction". The Minister expressed the purpose of the 2009 Ministerial Instructions to include the explanation of "the circumstances in which I may wish to consider exercising my public interest powers" and to "inform departmental officers when to refer a case to me so that I can decide whether to consider exercising such powers in the public interest". The 2009 Ministerial Instructions had the effect that all initial requests for the exercise of the Minister's personal override powers were to be brought to the Minister's attention. Section 16 of the 2009 Ministerial Instructions created different categories of initial request which were to be brought to the Minister's attention in different ways (either by way of a submission or a short summary of the issues in schedule format). But in every case of an initial request the Minister would decide whether to consider the request and, if the Minister chose to consider the request, the Minister would decide whether to exercise the personal override power. The department would reply, on behalf of the Minister, communicating whichever decision is made. Repeat requests were treated differently. Section 17 of the 2009 Ministerial Instructions provided that the Minister "generally do[es] not wish to consider a repeat request". A repeat request was defined as a request which had been previously considered by the Minister. But, in limited circumstances, the department could refer a repeat request to the Minister where it was satisfied that there had been a significant change in circumstances raising new, substantive issues which, in the opinion of the department, fell "within the ambit" of categories of case which the Minister might wish to consider, including the category of "Unique or exceptional circumstances". The department was to make that "ambit" assessment of unique or exceptional circumstances by reference to s 11 of the 2009 Ministerial Instructions by considering a list of factors that "may be relevant", including: an unfairness or unreasonableness criterion "where the application of relevant legislation leads to unfair or unreasonable results in a particular case"; a compassionate circumstances criterion of "strong compassionate circumstances such that a failure to recognise them would result in irreparable harm and continuing hardship to an Australian citizen or an Australian family unit (where at least one member of the family is an Australian citizen or Australian permanent resident)"; and Edelman an exceptional benefit criterion of "circumstances where exceptional economic, scientific, cultural or other benefit to Australia would result from the visa applicant being permitted to remain in Australia". In summary, the only circumstance in which a request for the exercise of the Minister's personal override power would not be brought to the attention of the Minister was where the request was a repeat request which the department assessed to be outside the ambit of cases that the Minister might wish to consider. The 2016 Ministerial Instructions The 2016 Ministerial Instructions made significant changes to the model of the 2009 Ministerial Instructions. Initial requests were no longer always to be brought to the attention of the Minister. Instead, the effect of s 10.1 was that initial requests would only be brought to the attention of the Minister if the department assessed "that the case has unique or exceptional circumstances". That assessment was no longer an "ambit" assessment of whether the case fell within the ambit of categories of case which the Minister might wish to consider (including the category of unique or exceptional circumstances). Instead, the assessment of whether circumstances were unique or exceptional was to be made by the department itself. There would be unique or exceptional circumstances if the department considered that one or more categories of unique or exceptional circumstances were satisfied, including the compassionate circumstances criterion and the exceptional benefit criterion. In relation to repeat requests − now defined as requests that had been previously received by the Minister − the effect of s 10.2 of the 2016 Ministerial Instructions was that it was again left to the departmental officials to decide whether to refer the request to the Minister. The department was required to be satisfied of two conditions: (i) there had been a significant change in circumstances since the previous request which raised new, substantive issues not previously provided or considered; and (ii) the new, substantive issues were considered by the department to fall within a category of unique or exceptional circumstances. In summary, the 2016 Ministerial Instructions moved away from a model in which almost all cases were brought to the Minister's attention with the only exception being those repeat applications that fell outside the ambit of circumstances that the Minister wanted to consider. Rather, the 2016 model became one in which no applications would be brought to the attention of the Minister unless the application met broad evaluative criteria to the satisfaction of the departmental officials. Edelman The facts of Mr Davis' and DCM20's appeals The circumstances of Mr Davis' appeal are as follows. Mr Davis is a United Kingdom citizen who arrived in Australia on a working holiday visa in 1997. He claims that he applied for a partner visa prior to the expiry of his working holiday visa. The evidence does not disclose whether Mr Davis' application for a partner visa was ever lodged or considered. For around 16 years, Mr Davis mistakenly believed that he was a permanent resident as a result of having lodged a partner visa application. He filed tax returns, held a Medicare card, purchased Australian property, and was part of the Australian community. But the legal status of Mr Davis' residence in Australia was always temporary and it was not suggested that his legal status or the associated conditions was unreasonable174. In November 2014, upon returning to Australia from a trip to the United Kingdom, Mr Davis became aware that he did not hold a current visa. He was granted a tourist visa, and shortly afterwards a Temporary Work visa. He also applied for a partner visa. The Temporary Work visa was cancelled. The partner visa application was refused by a delegate of the Minister and the Administrative Appeals Tribunal affirmed the decision of the delegate. On 11 February 2019, Mr Davis requested that the Minister exercise their personal override power under s 351(1) of the Migration Act to substitute a more favourable decision claiming that the circumstances of his case were unique and exceptional, including on the basis of the compassionate circumstances criterion in the 2016 Ministerial Instructions. Those compassionate circumstances included his long period of residence in Australia and the dependence upon him of an elderly Australian citizen. On 11 April 2019, a case officer provided an assessment of Mr Davis' case to the Assistant Director, Ministerial Intervention. The case officer's assessment contained significant errors, including the assertion that Mr Davis' investment and business ties to Australia were "obtained in the full knowledge that he did not have the right to remain in Australia permanently" and that there was "no evidence that any Australian citizen ... will suffer hardship as a result of his departure". The case was assessed as "not meeting the [2016 Ministerial Instructions] for referral to the Minister" because the circumstances were said not to be unique or exceptional. On 8 May 2019, the Assistant Director agreed. As Charlesworth J observed in the Full Court, one effect of the errors in the case officer's assessment was that the Assistant 174 Alexander v Minister for Home Affairs (2022) 96 ALJR 560 at 606 [211], 622 [291]; 401 ALR 438 at 491, 512. Edelman Director never had regard to the effect on the elderly Australian citizen of removing Mr Davis175. Mr Davis' request was never provided to the Minister. On 15 May 2019, Mr Davis' representatives wrote to the department noting that Mr Davis' request had not been provided to the Minister but submitting that the department had not considered various matters in Mr Davis' request, including the compassionate circumstances relating to the dependence of an elderly Australian citizen on Mr Davis. The Assistant Director treated the letter from Mr Davis' representatives as a "repeat request" and concluded that the information in the letter did not satisfy the criterion of new circumstances that are unique or exceptional. The reply from the Assistant Director concluded as follows: "This repeat request will not be referred to the Minister because the department is satisfied there has not been a significant change in circumstances since the previous request(s) which raises new, substantive issues that were not provided before or considered in a previous request and which would now present unique or exceptional circumstances." As with the 11 February 2019 request, none of the information in the letter from Mr Davis' representatives was ever provided to the Minister. DCM20 DCM20 is a citizen of Fiji who arrived in Australia with her family in 1993 on a Close Family Visitor (Short Stay) visa and was later granted a Close Family Visitor (Long Stay) visa. In 1994, DCM20 applied for refugee and humanitarian status. That application was refused. The Refugee Review Tribunal affirmed the decision. In 1995, DCM20 applied for a protection visa. That application was also refused by a delegate of the Minister. Again, the Refugee Review Tribunal affirmed the decision of the delegate. In 1996, DCM20 made a request for the Minister to exercise their personal override power under s 417(1) of the Migration Act. In 1997, DCM20 was informed that the Minister had decided not to exercise that power. In 1998, DCM20 applied for a resolution of status visa. Department records show that the application was undecided until June 2013, when the resolution of status visa was refused. By this time, DCM20 had been lawfully in Australia for two decades, although the legal status of her residence in Australia was always temporary and, 175 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 94 [324]. Edelman as with Mr Davis' appeal, it was not suggested that her temporary legal status or the associated conditions was unreasonable176. In August 2013, DCM20 made a request for the Minister to exercise their personal override power under s 351 of the Migration Act. Almost three years later, in April 2016, DCM20 was informed by the department that the Assistant Minister for Immigration had considered her request but had declined to intervene in the public interest. Approximately three months later, in June 2016, DCM20 again requested that the Minister exercise their personal override power under s 351 of the Migration Act. Six days later, DCM20 was notified by a departmental official that since the request was a repeat request, it would not be referred to the Minister because the department considered that it did not satisfy the criterion of new circumstances that are unique or exceptional. On 20 December 2019, DCM20 again requested ministerial intervention by exercise of the Minister's personal override powers under ss 351 and 417 of the Migration Act. DCM20 said in her request that since her previous requests she had become a full-time carer for her Australian citizen parents. DCM20 also said that she had the care of her niece and nephew whose father had died and whose mother suffered from depression. She added that to return her to Fiji − as a single woman of an ethnic minority with no family or friends in Fiji, no place of residence, and no employment − would make her more vulnerable than ever to abuse. On 10 January 2020, a departmental official signed a minute which concluded: "This repeat request will not be referred to the Minister because the department is satisfied there has not been a significant change in circumstances since the previous request(s) which raises new, substantive issues that were not provided before or considered in a previous request and which would now present unique or exceptional circumstances." The legal character of the departmental officials' actions As explained above, whether or not the label "non-prerogative" should be attached to such an exercise of a liberty might depend upon the level of generality at which the liberty is characterised. Both the 2009 Ministerial Instructions and the 2016 Ministerial Instructions were in the general form of, and purported to be, instructions to officials to advise and assist the Minister in the exercise (and implementation of the exercise) of the Minister's statutory powers and liberties. At a high level of generality the exercise of a liberty pursuant to those instructions involves parity with an ordinary person: an ordinary person has a liberty to advise and assist another. But characterised with greater particularity there is no parity: 176 Alexander v Minister for Home Affairs (2022) 96 ALJR 560 at 606 [211], 622 [291]; 401 ALR 438 at 491, 512. Edelman an ordinary person does not have a liberty to advise and assist a Minister in the performance of ministerial duties. Consistently with an approach based on a high level of generality, the position of the parties throughout this litigation was that the exercise by departmental officials of a liberty to advise and assist the Minister was not a this the Commonwealth Executive. Nothing prerogative of characterisation from Professor Winterton, "the debate concerning the proper definition of the 'prerogative' is a particularly sterile one"177. However described, there is no doubt that the liberty to advise and assist a Minister exists within the basic functions relating to the ordinary course of administering a recognised function of government. these appeals. this context, turns upon to borrow It is unnecessary to attempt to classify, as prerogative or not, the general non-statutory liberty that enables the Commonwealth Executive to perform basic functions. The relevant point is that that liberty permits the Minister to issue instructions that provide for the manner in which officials can advise and assist the Minister. With one arguable exception, the 2009 Ministerial Instructions were instructions of this nature concerning how to advise and assist the Minister. The arguable exception in the 2009 Ministerial Instructions relates to repeat requests. It is arguable that the liberty to decide whether to consider a repeat request is exercised (in substance) by the departmental official, not the Minister, when the official applies the broad criterion of whether the application is outside the ambit of cases that the Minister might wish to consider. But these appeals are not concerned with that arguable exception, and it is unnecessary to consider it. The 2016 Ministerial Instructions were quite different from the 2009 Ministerial Instructions in their operation. Although the 2016 Ministerial Instructions also purported to be instructions to officials to advise and assist the Minister178, and although they provided criteria for circumstances that are unique or exceptional, including the compassionate circumstances criterion and the exceptional benefit criterion, they conferred upon the officials a broad discretion in all cases to decide whether a request should be brought to the attention of the Minister. The breadth of the criteria and the extent of evaluation by the official meant that the decision was not one in which "the Minister ... determined, in 177 Winterton, Parliament, the Executive and the Governor-General (1983) at 112. 178 2016 Ministerial Instructions, ss 2, 12. Edelman advance, the circumstances in which he or she wishe[d] to be put in a position to consider exercising the power"179. The exercise by a departmental official of the broad discretion in the 2016 Ministerial Instructions to refuse to refer a request to the Minister amounted, in substance, to the exercise by the official of the Minister's personal liberty. The officials' decisions not to refer Mr Davis' and DCM20's requests to the Minister were therefore decisions which amounted, in substance, to the exercise of the Minister's personal liberty to consider (or not to consider) the requests. There can be no doubt that each of Mr Davis and DCM20 has a sufficiently special interest to seek a declaration as to the legality of the exercise of a public liberty by departmental officials in relation to each request. The decision by departmental officials, in substance, that the requests by Mr Davis and DCM20 would not be considered did not itself affect any legal relation of Mr Davis or DCM20. Neither appellant had a right to have their request considered by the Minister, so neither appellant was deprived of any right by the decision of the officials. Nor, as a matter of law, did the officials exercise any power that deprived the Minister of the liberty to consider, since the Minister remained entitled to consider the requests. Nevertheless, as a matter of substantive effect, the actions of the officials involved the exercise of a liberty which they did not have to deprive Mr Davis and DCM20 of a consideration of their requests by the Minister. The liberty to consider (or decline to consider) a request was not conferred by statute on the departmental officials; rather, s 351(3) of the Migration Act created the liberty and made it personal to the Minister. Hence, this statutory liberty could not be said to involve the exercise of basic functions by an official relating to the ordinary course of administering a recognised function of government. The exercise of the liberty by the departmental officials was therefore unlawful. Unreasonableness in the exercise of non-statutory executive powers and liberties In each of the appeals before this Court, an assumption made in the decisions of the primary judge and the Full Court was that the actions of the departmental officials involved only advice and assistance to the Minister. On that assumption, those courts considered whether the actions of the departmental officials were unreasonable. Since that assumption was incorrect, because the actions of the officials involved in substance an invalid exercise of the Minister's personal liberty, it is unnecessary on these appeals to revisit that issue of unreasonableness as a condition of the legality of the officials' advice and assistance. However, in light of the thorough submissions concerning the issue of 179 Compare the submission in Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 640, accepted at 665 [91]. Edelman an unreasonableness constraint upon the exercise of non-statutory executive liberties and powers it is appropriate to make two observations. First, the submissions of the parties assumed that non-statutory executive liberties and powers were either always subject to a condition of reasonableness or never subject to such a condition. As a starting point, there is obvious force in the view of Robertson J, adopted by several members of the Full Court on these appeals180, that it would be "incongruous" for reasonableness usually to be an implied condition upon the exercise of statutory executive power, but never to be an implied condition upon the exercise of non-statutory executive power (whether or not characterised as prerogative)181. The fundamental principles of the common law that inform statutory implications182 must also inform the scope of executive liberty and power which is prerogative or otherwise implied from the creation of a functional Commonwealth polity. In this manner, like statutory executive power, the existence of a condition of legal reasonableness in the exercise of non-statutory executive powers or liberties – and the content of such a condition183 – will depend upon the nature of the power or liberty being exercised. The existence and content of legal reasonableness in the exercise of a non-statutory executive liberty or power will be part of the definition of the liberty or power itself. The liberty or power to act will commonly, but not necessarily, be identified as a liberty or power to act reasonably. Secondly, and related to the first point, any reasonableness requirement for the exercise of an extremely broad non-statutory executive power will usually involve a high threshold184. As Steward J rightly points out in his Honour's reasons in this case, the various reasons given by the officials in relation to Mr Davis' 180 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 27 [3], 35 [39], 42 [66], 54 [118], 89 [305]. 181 Jabbour v Secretary, Department of Home Affairs (2019) 269 FCR 438 at 460 [101]. 182 Nathanson v Minister for Home Affairs (2022) 96 ALJR 737 at 747 [30], 758 [89]; 403 ALR 398 at 409, 424; Stephens v The Queen (2022) 96 ALJR 871 at 879-880 [33]-[34]; 404 ALR 367 at 376. 183 See also Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 184 Horan, "Judicial Review of Non-Statutory Executive Powers" (2003) 31 Federal Law Review 551 at 568, referring to R v Ministry of Defence; Ex parte Smith [1996] QB 517 at 556. Edelman requests can be characterised as ungenerous and unsatisfactory185. The decisions of the officials in relation to both Mr Davis and DCM20 do not reflect the virtue of exceptional charity and equity – for others, tzedakah or zakah – which is part of the foundations of the grant to the Minister of the liberty and power in s 351(1). But that lack of virtue may not be sufficient to establish any high threshold of legal unreasonableness in the result if that issue were to arise. The privative clause The appellants commenced these proceedings in the original jurisdiction of the Federal Court of Australia under s 39B of the Judiciary Act 1903 (Cth). But s 476A(1) of the Migration Act denies jurisdiction to the Federal Court, with certain exceptions that do not relevantly apply, in "relation to a migration decision". A "migration decision" is defined in s 5(1) as relevantly including "a privative clause decision" or "a purported privative clause decision". Hence, it was submitted, if the decision by the departmental officials was "a privative clause decision" or "a purported privative clause decision", then the Federal Court would not have had jurisdiction to consider the issue the subject of the appeals to this Court, and this Court would have no jurisdiction to consider it on appeal. A "privative clause decision" has the meaning given by s 474(2)186, which is, relevantly, a decision of an administrative character made, proposed to be made, or required to be made under the Migration Act. A "purported privative clause decision" has the meaning given by s 5E187, which is, relevantly, a decision purportedly made, proposed to be made, or required to be made, under the Migration Act that would be a privative clause decision if there were not a failure to exercise jurisdiction or an excess of jurisdiction in the making of the decision. The privative clause in s 476A(1) is part of a scheme, together with the privative clause in s 476(2), which attempts to exclude the jurisdiction of all courts to adjudicate upon the validity of privative clause decisions and purported privative clause decisions. Putting constitutional limitations concerning the scope of such clauses to one side, such legislative schemes have historically been given a restricted meaning by courts. The premise underlying the courts' restrictive approach to interpretation of privative clauses is the background "that Parliament would be prima facie expected to respect" common law principles, particularly the powerful principle concerning access to the courts to adjudicate disputes: "The more fundamental the rights, and the greater the extent to which they would be 186 Migration Act 1958 (Cth), s 5(1) definition of "privative clause decision". 187 Migration Act 1958 (Cth), s 5(1) definition of "purported privative clause decision". Edelman infringed ... the less likely it is that such an intention will be ascribed to Parliament"188. Since the Migration Act did not permit either the Minister's liberty or the Minister's power under s 351(1) to be exercised by any other person, the 2016 Ministerial Instructions could not have any statutory basis189. They could not empower any action under the Migration Act. Nor did the 2016 Ministerial Instructions purport to do so. They purported to provide the manner in which officials could advise and assist the Minister similar to the non-statutory general liberties of "acquisition of information and categorisation of requests" under the 2009 Ministerial Instructions, which had been said by French CJ and Kiefel J in 2012 to be "an executive function incidental to the administration of the Act"190. For this reason, although the effect of the actions of the departmental officials in Mr Davis' and DCM20's cases was to exercise the personal liberty of the Minister to consider whether to exercise the personal override power, their actions did not purport to do so. They purported to be actions that advised and assisted the Minister. In other words, they purported only to be action "under" the non-statutory 2016 Ministerial Instructions. The decision by the departmental officials not to refer the requests by Mr Davis and DCM20 to the Minister was neither a liberty exercised, nor one that was purported to be exercised, under the Migration Act. Departing from previous reasoning in this Court A consequence of this decision is that the reasoning of this Court in Plaintiff S10/2011 v Minister for Immigration and Citizenship191, Minister for Immigration and Border Protection v SZSSJ192, and several decisions of single Justices of this Court must now be regarded, at least, as containing inadequate or erroneous assumptions or reasoning. Those controversial decisions were the subject of extensive submissions in these appeals. It is unnecessary to consider whether those 188 Stephens v The Queen (2022) 96 ALJR 871 at 879-880 [33]-[34]; 404 ALR 367 at 376, quoting in part Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 189 See also Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 653 [46], 655 [50]-[51]; Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 199 [47]. 190 Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 191 (2012) 246 CLR 636. 192 (2016) 259 CLR 180. Edelman decisions need to be overruled or whether the results in those cases can be distinguished, because the reasoning relevant to these appeals was not the subject of argument in those cases193. It suffices to identify the extent to which those decisions must now be seen to have been based on flawed assumptions or reasoning. The background to the controversial decisions was the unanimous joint judgment of this Court in Plaintiff M61/2010E v The Commonwealth194. In that case, this Court held that departmental officials were subject to the obligation of procedural fairness in their advice and assistance to the Minister when the Minister was considering whether to exercise a personal override power under the Migration Act (the exercise of which would affect the applicant's liberty). Importantly, however, the Court said that procedural fairness also conditioned steps taken in relation to the Minister's liberty to consider whether to exercise their personal override power195. In Plaintiff S10/2011, the issue was whether departmental officials were required to afford procedural fairness to four applicants who had requested that the Minister exercise in their favour statutory powers contained in, or similar to those in, s 351 of the Migration Act. The officials had not referred requests by three applicants to the Minister. The request of a fourth applicant had been referred to the Minister and the Minister's response was "taken to have been a refusal to consider the exercise of the power"196. This Court unanimously held that procedural fairness was not required in the process concerning any of the applicants. In the joint reasons of French CJ and Kiefel J, their Honours said that the issue of the 2009 Ministerial Instructions "did not involve a decision on the part of the Minister, acting under the relevant section, to consider the exercise of the power conferred"197. Their Honours' reasoning must mean that the 2009 Ministerial Instructions did not reflect any consideration by the Minister about whether to exercise the power. Hence, on this reasoning, at least in relation to three of the applicants, the Minister had not exercised any liberty to consider whether the 193 Felton v Mulligan (1971) 124 CLR 367 at 413; Baker v The Queen [1975] AC 774 at 787-789; Coleman v Power (2004) 220 CLR 1 at 44-45 [79]; CSR Ltd v Eddy (2005) 226 CLR 1 at 11 [13]. See also Cross and Harris, Precedent in English Law, 4th ed (1991) at 158-161. 194 (2010) 243 CLR 319. 195 (2010) 243 CLR 319 at 354 [78]. 196 (2012) 246 CLR 636 at 645 [16]. 197 (2012) 246 CLR 636 at 653 [46]. Edelman power should be exercised. Therefore, the departmental officials must have, in substance, exercised a liberty that they did not have in deciding that the requests would not be considered by the Minister. But, contrary to the conclusion reached by a majority of this Court on the present appeals, their Honours did not suggest that there might be any difficulty with such a result. A different approach was taken in the joint reasons of Gummow, Hayne, Crennan and Bell JJ. Their Honours said that the effect of the 2009 Ministerial Instructions was to implement a decision made by the Minister whereby the Minister had "determined in advance the circumstances in which he or she wishes to be put in a position to consider exercise of the discretionary powers by the advice of department officers"198. On that reasoning, it was the Minister who had exercised the liberty under the Migration Act, although their Honours held that the relevant provisions, on their proper construction, were not conditioned upon an implication of procedural fairness199. The decision in Plaintiff M61/2010E was distinguished on the basis that it involved different provisions, concerning offshore entry persons200. In their joint reasons, Gummow, Hayne, Crennan and Bell JJ relied upon two decisions of the Federal Court to conclude that it was within the competence of the Minister to make the 2009 Ministerial Instructions to implement "an advance determination" of the circumstances in which the Minister wishes to be put in a position to consider the exercise of powers similar to those in s 351. In the first of those decisions, in the passage cited by their Honours, the Full Court of the Federal Court held that so long as an officer was acting in accordance with the Minister's instructions, the officer had no duty to refer the application to the Minister201. In the second of those decisions, in the first of the paragraphs cited by their Honours, Lindgren J held that202: "The Minister's decision not to consider exercising his power ... comprises his decision just referred to operating upon the subjective judgment formed by [the departmental officer]. There is no suggestion in the evidence that the Minister intended anything other than that provided the officer in good faith formed the view that the 'unique' or 'exceptional 198 (2012) 246 CLR 636 at 665 [91]. 199 (2012) 246 CLR 636 at 667-668 [98]-[100]. 200 (2012) 246 CLR 636 at 656-657 [59], 662 [79]. 201 Bedlington v Chong (1998) 87 FCR 75 at 80-81. 202 Raikua v Minister for Immigration and Multicultural and Indigenous Affairs (2007) 158 FCR 510 at 522 [63]. Edelman circumstances' criterion was not met, the Minister did not wish to consider exercising his ... power." The assumption underlying their Honours' joint reasons appears to be that so long as departmental officials are acting in good faith, any amount of subjective evaluation will not deprive the departmental officials' actions of the character of mere assistance to implement the exercise of the Minister's liberty, embodied in the advance determination by the Minister. To the extent that that assumption is capable of being extended to the 2016 Ministerial Instructions it is an assumption that is contrary to the result of these appeals. In SZSSJ203, this Court considered and explained the effect of the reasons in Plaintiff S10/2011. In a joint judgment, the Court repeatedly described the actions of officials under administrative processes, such as the 2009 Ministerial Instructions, as "informing the Minister"204 or actions "to assist the Minister"205. The Court said that the effect of the various reasons in Plaintiff S10/2011 was that under the 2009 Ministerial Instructions "where the Department had not referred a case to the Minister, no statutory power had been engaged"206 and the assistance to the Minister to make the decision had "no statutory basis"207. The Court did not acknowledge that the exercise by the Minister of a personal liberty to consider a request was action under the Migration Act. Nor did the Court recognise that there may be a point at which an official's actions could, in substance, amount to the exercise of the Minister's personal liberty. An assumption underlying the reasons in SZSSJ, like the joint reasons of Gummow, Hayne, Crennan and Bell JJ in Plaintiff S10/2011, may have been that the exercise of a liberty as to whether or not to consider a request will remain that of the Minister, no matter how much subjective evaluation is undertaken in any good faith decision by a departmental official not to bring the request to the attention of the Minister. As Mortimer J observed in the Full Court in these appeals208, subsequent decisions of single Justices of this Court may have 203 (2016) 259 CLR 180. 204 (2016) 259 CLR 180 at 197 [41], [42], 198 [44]. 205 (2016) 259 CLR 180 at 200 [54], 200-201 [56]. 206 (2016) 259 CLR 180 at 199 [47]. 207 (2016) 259 CLR 180 at 200 [54]. 208 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 61-62 [150]-[151]. Edelman proceeded on the same assumption209. To those decisions can be added a decision of my own, sitting also as a single Justice210. The actions of the departmental officials, on this assumption, are only the exercise of a "common law" liberty to advise or assist the Minister, such that their actions will not require any statutory basis. For the reasons explained above, the unqualified assumptions or unqualified reasoning in these cases is incorrect. There is a point beyond which the evaluative scope given to the departmental officials is sufficiently broad that their decisions, in substance, amount to an exercise of the personal liberty of the Minister under the Migration Act to consider a request. The decisions of the departmental officials in relation to Mr Davis and DCM20, purporting only to be under the 2016 Ministerial Instructions, went beyond that point. Conclusion Mr Davis and DCM20 have now resided in Australia for, respectively, over 25 years and around 30 years. Both are fully integrated into the Australian community. The lives of other Australian citizens depend upon them both. But they have never been legally entitled to remain permanently in Australia. Each of their requests for the Minister to consider exercising a personal override power was their last attempt to avoid deportation. It would have been a simple matter for the Commonwealth Parliament to have included an additional sub-section, s 351(8), permitting departmental officials, as either delegates or agents, to exercise a liberty to decide whether to refer to the Minister an application for the exercise of the personal override power. If they were acting as delegates, such a provision would have permitted departmental officials to exercise the liberty on their own behalf. If they were acting as agents, such a provision would have permitted departmental officials to exercise the liberty on the Minister's behalf. But the Commonwealth Parliament did not do so. The liberty to consider an application, like the power itself, was made personal to the Minister. The departmental officials could not lawfully exercise the Minister's personal liberty to refuse to consider the requests by Mr Davis and DCM20. In substance, that is what they did. 209 Plaintiff S330/2018 v Minister for Immigration, Citizenship and Multicultural Affairs [2019] HCATrans 028; Plaintiff S28/2018 v Minister for Home Affairs [2018] HCATrans 168. See also Plaintiff S53/2019 v Minister for Immigration, Citizenship and Multicultural Affairs (2019) 94 ALJR 1 at 2 [7]; 374 ALR 438 at 210 Plaintiff S322/2018 v Minister for Immigration, Citizenship and Multicultural Affairs [2019] HCATrans 096. Edelman I agree with the declarations and orders proposed by Kiefel CJ, Gageler and STEWARD J. I regret that I am unable to agree with my colleagues. But these appeals are important. Some governmental processes sound in, or produce, an exercise of power that will have legal consequences on rights and obligations. But many such processes are not of that kind. Such processes might involve a public servant deciding to do something, and in that sense only it might be said that a "decision" has been made; but that decision may only have practical consequences that fall short of legal outcomes. These appeals highlight the importance in public law of distinguishing between decisions which affect legal rights and obligations and those which do not. Here, each "decision" said to have exceeded the executive power of the Commonwealth had no legal consequences. Each only had practical consequences. Each "decision" was an anterior step that could have led, but ultimately did not lead, to an exercise of power affecting rights and obligations. The result is that the rights and obligations of each appellant remain untouched, and the Minister is not obliged to do anything at all. In that respect, it is well to remember what Brennan J said in Attorney- General (NSW) v Quin211: "At common law judicial review does not consist in assessing the legal effect of the steps taken preliminary to the exercise of a power but in a determination of the legality of the exercise or purported exercise of the power. The preliminary steps may be relevant to the legality of the exercise of the power but they are not themselves the subject of review." The statutory power The relevant parts of s 351 of the Migration Act 1958 (Cth) ("the Act") are set out in the reasons of the plurality. It is well established that the power to substitute a more favourable decision is one reposed in the Minister personally (described as a "substantive decision")212. The power is enlivened when the Minister thinks that it is in the "public interest to do so"213. It is also clear that a decision to consider whether to exercise the power to substitute a more favourable decision must also be made personally by the Minister (described as a "procedural decision")214. Whether the Minister has, in a given case, made a procedural 211 (1990) 170 CLR 1 at 26. 212 Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 200 [53] per French CJ, Kiefel, Bell, Gageler, Keane, Nettle and Gordon JJ. 213 Migration Act 1958 (Cth), s 351(1). 214 Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 200 [53] per French CJ, Kiefel, Bell, Gageler, Keane, Nettle and Gordon JJ. Steward decision and then a substantive decision is a question of fact215. Here, it was not in dispute that the Minister made neither type of decision in the case of each appellant. This dichotomy is not, however, an exhaustive expression of all that s 351 involves. That is because s 351(7) provides that the Minister is not under any duty to consider whether to exercise the power conferred by s 351(1), "whether he or she is requested to do so by the applicant or by any other person, or in any other circumstances". Sub-section (7) provides the contrary intention that expressly defeats the ordinary rule that the conferral of a statutory power or discretion implies a duty to consider an application for the exercise of that power or discretion. It is critical to the outcome of the two appeals. The reference in sub- s (7) to the making of requests evinces a parliamentary recognition that, given the conferral of such an important non-compellable dispensing power on the Minister, the Minister's Department ("the Department") is bound to receive a great many requests for intervention. These would need to be administered in some way. But the administration of this feature of the statutory scheme is not on this occasion expressed to be something the Minister must do "personally". Rather, Parliament must be taken to have intended that the Minister is entitled to administer this aspect of the statutory scheme through the Department without any personal involvement216. That is what the Minister did here by issuing the "Minister's guidelines on ministerial powers (s351, s417 and s501J)" ("the 2016 Guidelines"). The lawfulness of proceeding in this way was recognised by all Justices of this Court in Minister for Immigration and Border Protection v SZSSJ217. Amongst other things, that case concerned analogous provisions of the Act (ss 48B, 195A and 417) which conferred upon the Minister similar non-compellable personal powers. After referring to the Minister's ability to make a procedural and then a substantive decision, this Court said218: "If the Minister has not made a personal procedural decision to consider whether to make a substantive decision, a process undertaken by the 215 Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 200 [55] per French CJ, Kiefel, Bell, Gageler, Keane, Nettle and Gordon JJ. 216 An analogous recognition of the practical necessities of the administration of government may be found in O'Reilly v State Bank of Victoria Commissioners (1982) 153 CLR 1 at 12 per Gibbs CJ; see also Carltona Ltd v Commissioners of Works [1943] 2 All ER 560 at 563 per Lord Greene MR. 217 (2016) 259 CLR 180. 218 (2016) 259 CLR 180 at 200 [54] per French CJ, Kiefel, Bell, Gageler, Keane, Nettle Steward Department on the Minister's instructions to assist the Minister to make the procedural decision has no statutory basis and does not attract a requirement to afford procedural fairness." Importantly, the Department's administration of ministerial instructions concerning how it is to deal with the receipt of requests to exercise the power conferred by s 351 does not necessarily require an assessment of what is in the public interest. No departmental officer is required to reach, or is capable of reaching, a conclusion, one way or the other, as to what is in the public interest. Nor is the Minister in any way bound to follow what the Department might recommend. Nor, for the purposes of deciding whether to consider exercising the power in s 351(1) (the procedural step), is the Minister necessarily confined to what is in the public interest. The Minister might decide to consider intervening for a range of different reasons, including, for example, because of media coverage in relation to a given case. It is only once a positive procedural decision has been made that the Minister must then decide what is in the public interest with respect to the request before him or her219. But until that substantive decision is reached, any ministerial or departmental consideration of public interest factors has no bearing on the legal effect of the statutory decision-making process under s 351. The Guidelines The 2016 Guidelines The 2016 Guidelines were said to be "invalid" because they authorised an impermissible delegation to the Department of the Minister's personal powers under s 351. However, for the reasons which follow, the 2016 Guidelines do not require officers of the Department to exercise statutory power. The procedures mandated by them do not oblige an officer of the Department to mimic an exercise of the Minister's power to decide whether it is in the "public interest" to substitute a more favourable decision, or indeed whether to consider an exercise of such a power. That is not what the 2016 Guidelines address. Nor can an application of the 2016 Guidelines be characterised as an abdication of power; that is because unless and until the Minister personally makes a procedural decision, no power has yet been exercised and there is nothing to abdicate. Moreover, it was agreed by all parties that the 2016 Guidelines do not have any force at law; at their highest, their existence might found some form of "legitimate expectation" about their 219 It is an express requirement of the Act that if the Minister makes a substantive decision that it is in the public interest to substitute a more favourable decision, he or she must then table reasons for that public interest decision before each House of Parliament: s 351(4)-(6). Steward application, but, in this country, that is an insufficient basis for the securing of public law remedies220. A more detailed consideration of the 2016 Guidelines supports these conclusions. The 2016 Guidelines describe their function or purpose as follows: "The purpose of these guidelines is to: explain the circumstances in which [the Minister] may wish to consider intervening in a case explain how a person may request that [the Minister] consider intervening in their case explain when [the Minister's] Department should refer a case to [him or her] confirm that if a case does not meet these guidelines, [the Minister] do[es] not wish to consider intervening in that case." The 2016 Guidelines then expressly state that "[w]hat is and what is not in the public interest is for [the Minister] to determine". In other words, on no view could it be said that the 2016 Guidelines authorise the Department to make that very decision. Instead, the 2016 Guidelines regulate, on the Minister's instructions, how the Department is to administer the many requests it receives which seek to engage the power conferred by s 351(1), in circumstances where the Minister is under no obligation or duty to consider whether or not to exercise that power. As such, the 2016 Guidelines do not call for the exercise of any power, whether statutory or non-statutory in nature. Like so many governmental processes which require the administration of something, they are a precursor to the exercise of power (if any). And because the 2016 Guidelines do not have the force of law, their application by departmental officers cannot lead to any legal consequences. The 2016 Guidelines exist as a rational means of sorting through the many requests the Department no doubt receives. The criteria are directed at that task. Under the heading "Ministerial intervention principles", the Minister has set out a series of expectations about, amongst other things, when he or she would be unlikely to intervene. But the 2016 Guidelines also state that "consideration of a 220 Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 38-41 per Brennan J; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 27-28 [81]-[83] per McHugh and Gummow JJ, 36-38 [116]- [121] per Hayne J, 45-48 [140]-[148] per Callinan J; Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326 at 334-335 [28]-[30] per Kiefel, Bell and Keane JJ, 343 [61] per Gageler and Gordon JJ. Steward case for intervention is at [the Minister's] discretion and is not an extension of the visa process". What follows is a section headed "Cases that should be brought to my attention". This section has two sub-headings. The first is "Unique or exceptional circumstances". These are said to be matters that "may be referred to [the Minister] for possible consideration of the use of [his or her] intervention powers". A series of possible unique or exceptional circumstances are listed. These include, for example, "strong compassionate circumstances" and the presence of "exceptional economic, scientific, cultural or other benefit [that] would result from the person being permitted to remain in Australia". Under the next sub-heading – "Other relevant information" – the 2016 Guidelines specify the information the Minister will need where cases are referred to him or her. These include, for example, the interests of any children, whether there are any "character" concerns, and the person's level of integration into the Australian community. It may be accepted that the circumstances listed under these sub-headings are directed at issues relevant to what might be thought to be in the public interest. It may also be accepted that the 2016 Guidelines oblige departmental officers to exercise some degree of judgment. As will be explained below, the same was true in relation to the earlier 2009 version of these guidelines ("Minister's guidelines on ministerial powers (s345, s351, s391, s417, s454 and s501J)" ("the 2009 Guidelines")). For the purposes of sorting out which requests should be brought to the attention of the Minister, that is hardly surprising. Directing departmental officers to consider which requests are most likely to satisfy the Minister's public interest threshold is an entirely sensible way of dealing with them administratively. But, importantly, the criteria listed in the 2016 Guidelines are not exhaustive of what the Minister might consider to be in the "public interest" for the purposes of his or her power under s 351(1). Nor, in sorting through in this way requests that are received, can it be said that departmental officers are thereby exercising the power reposed in the Minister. They are instead assisting the Minister in determining whether he or she should or should not, in the context of an entirely non-compellable power, consider whether to exercise that power. There is next a section headed "Cases that should not be brought to my attention". These include cases which do not satisfy the foregoing guidelines for referral, and which are accompanied by one or more listed circumstances. Those circumstances include, for example, where a person has had a visa cancelled on character grounds or because they breached their visa conditions, or where the person has an extant application for merits review of a visa decision. Where the case is one which is not to be brought to the attention of the Minister, the 2016 Guidelines specify that the "Department will finalise [it] without referral to [the Minister] and advise the person or their authorised representative in writing". What then follows in the 2016 Guidelines are instructions concerning how to request ministerial intervention. There are the following sub-headings: "Who can make a request?"; "How to make a request"; "How requests for Ministerial intervention will be progressed" (with different rules applicable to first requests and repeat requests); "Outcome of Minister's consideration"; and "Removal policy". All of these topics address how the Department is to administer the receipt of requests to exercise the power conferred by s 351(1). The content under one sub-heading is particularly relevant. It is entitled "Minister's powers not limited by Minister's guidelines" and states the following: "[The Minister's] powers to intervene in an individual case, where [he or she] believe[s] it is in the public interest to do so, exist whether or not the case is brought to [his or her] attention in the manner described above, as long as a decision has been made by a relevant review tribunal and that decision continues to exist ... [The Minister] may consider intervening in cases where the circumstances do not fall within the unique or exceptional circumstances as described in section 4 of these guidelines, if [the Minister] consider[s] it to be in the public interest. Where [the Minister] believe[s] it is appropriate, [he or she] will seek further information to help [him or her] to determine whether to consider intervening in a case." The foregoing paragraphs elucidate what an application of the 2016 Guidelines can in fact "finalise". Where a request is made and no referral to the Minister follows, from a practical perspective the likely result is that no positive exercise of the power conferred by s 351 of the Act will ever be made. That is because the Minister is likely to be unaware of the request. But in such a case, no statutory power will have been exercised. Where a referral is made, once again there are only practical consequences. That is because it is for the Minister then to decide whether to make a procedural decision to consider it. Referral increases the probability both that a procedural decision and then a substantive decision will be made. But until a procedural decision is made, no power is ever exercised. In contrast, it does not follow that, where a referral is not made, an exercise of the power conferred by s 351 will never, or can never, arise. That is because all parties accepted that the Minister was free to ignore his or her own Department, its recommendations, and the 2016 Guidelines, and exercise the power whenever it was in the public interest to do so. In that respect, the Minister's capacity to know about any request that had been made was not limited to what the Department had referred for consideration. This is expressly consistent with the passage from the 2016 Guidelines set out above221. It follows that when the Department decides not 221 See [210]. Steward to refer a request to the Minister, there is a "conclusive effect" – but only as a practical matter, not as a legal outcome. As French CJ and Kiefel J observed in relation to the 2009 Guidelines concerning s 351 (addressed below) in Plaintiff S10/2011 v Minister for Immigration and Citizenship222: "That question arises if the plaintiffs were to establish that the inquiries made, and the submissions prepared, by officers of the Department of Immigration and Citizenship ... pursuant to the ministerial guidelines were themselves capable of affecting, defeating or prejudicing rights, interests or legitimate expectations. They were not." Moreover, it is a misnomer to say that in the case of each appellant a "decision" was made by the Department, if that word is intended to refer to a decision which legally interferes with or alters rights and obligations. A more accurate description of what occurred in each case is that the Department did not refer either request to the Minister: that is, it declined to make a referral. The foregoing does not elevate form over substance. It is a recognition of when statutory power is or is not exercised for the purposes of s 351. And it faithfully preserves the legal reality that the 2016 Guidelines do not have the force of law. In any event, there are dangers in relying on the concepts of form and substance legal and practical the critical distinction between consequences. to erode One further aspect of the 2016 Guidelines should be noted: it is what they say about "repeat requests"223. They state that the Minister does not want to consider repeat requests save in "limited circumstances". That threshold will be reached where the Department is satisfied that there has been a significant change in circumstances since the previous request which raises new substantive issues, and that these issues are unique or exceptional in the sense described in the 2016 Guidelines. Three observations should be made in relation to the 2016 Guidelines. First, the foregoing description of what the 2016 Guidelines entail justifies their characterisation as a sensible administrative mechanism for the processing of requests received for the exercise of the power conferred by s 351 of the Act. The faithful application of those guidelines by an officer of the Department thus cannot 222 (2012) 246 CLR 636 at 642 [3]. 223 A request is defined by the 2016 Guidelines to be a "repeat request" if any Minister, current or previous, has "previously received a request to intervene in the person's case (whether for the present or any previous visa decision) under any of the powers covered in these guidelines". be seen as an attempt to exercise the Minister's procedural or substantive powers. The application of the 2016 Guidelines is an anterior step to the possible exercise of these powers. In other words, if it is a question of fact whether the Minister has made a procedural decision or a substantive decision under s 351, then it must also be a question of fact whether the Department has here sought to exercise either power. For the foregoing reasons, it has not. Secondly, nothing in the language of s 351 prevents the issue by the Minister of guidelines of the foregoing kind which are directed at sorting through the large number of requests the Minister's Department no doubt receives. The 2016 Guidelines are no more than a formal expression of the Minister's reasonable request to the Department to bring to his or her attention the most meritorious requests for consideration. It would be an absurd result if the Minister could not lawfully seek such assistance from departmental officers. Thirdly, the language of s 351 does not in any way limit the instructions the Minister may give for the purposes of administering the receipt of requests to "objective" matters, whatever that term might mean. The 2009 Guidelines, described below and considered by this Court in Plaintiff S10 and SZSSJ, contained many of the same evaluative or non-objective criteria found in the 2016 Guidelines. The validity of the 2009 Guidelines was endorsed in both cases. With great respect to my colleagues, the distinction between objective and non-objective criteria for the purposes of administering a Department of State is not supported by the Constitution or by the language of s 351 of the Act. It is practically unworkable and unsupported by authority. The 2009 Guidelines The 2009 Guidelines were very similar to the 2016 Guidelines. They assumed some prominence in these appeals because of what this Court had earlier said about them in Plaintiff S10 and SZSSJ (as to which see below). Like the 2016 Guidelines, the 2009 Guidelines explained the circumstances in which the Minister might wish to consider exercising his or her power and when departmental officers were to refer cases to the Minister for consideration. And again, like the 2016 Guidelines, they required departmental officers to perform a very similar evaluative exercise in determining whether there existed in relation to a given request "unique or exceptional circumstances". The function or purpose of the 2009 Guidelines was really the same as that of the 2016 Guidelines: the sorting out of which requests were to go to the Minister by an application of criteria that gave rise to matters for evaluative judgment. Two aspects of the 2009 Guidelines should be noted. First, initial requests found by the Department not to involve unique or exceptional circumstances were nonetheless brought to the attention of the Minister "in schedule format, so that [the Minister] may indicate" whether he or she wished to consider the exercise of the power conferred by s 351. The appellants relied greatly on this difference. But again, the provision of this "schedule" had no consequences at law, and legally affected no rights and obligations; it merely, perhaps marginally so, increased the probability that the Minister might exercise his or her "procedural" power and then his or her "substantive" power in relation to one or more of the requests in the schedule. Nor can the mere omission of the schedule from the 2016 Guidelines justify a characterisation of their application by the Department as an act in excess of federal executive power. For that characterisation to be tenable, it would have to be accepted that the Minister is compelled to view, and make a procedural decision either to consider or not to consider, every request made for the exercise of the dispensing power under s 351. But as already explained, that conclusion cannot be supported by the text and purpose of s 351. Considered in context, whether with the schedule from the 2009 Guidelines or without it, the 2016 Guidelines remain what they are: an administrative means of screening the many requests received by the Department. Secondly, the schedule required by the 2009 Guidelines only applied to initial requests, not repeat requests. Just like the 2016 Guidelines, the 2009 Guidelines provided that the Minister "generally" did not want to see repeat requests unless the Department formed the view that there had been a significant change in circumstances which raised new, substantive issues not previously considered, and which, "in the opinion[] of the [D]epartment", involved unique or exceptional circumstances (or had been referred to the Department by a "review tribunal member"). Again, just like the 2016 Guidelines, the 2009 Guidelines called for the Department to undertake an evaluative assessment to determine whether a given request did or did not meet these requirements. The 2009 Guidelines also specified that eight other categories of requests did not need to be brought to the Minister's attention. For example, where it may have been open to an applicant to make a valid application for a "Partner visa onshore", the Department was to reply on behalf of the Minister that he or she did not wish to consider exercising his or her power conferred by s 351. Plaintiff S10 and SZSSJ The appellants needed to rely upon the first difference between the 2016 and 2009 Guidelines set out above because this Court determined in Plaintiff S10 that the 2009 Guidelines were valid and did not, when applied, affect legal rights and obligations. The appellants submitted that the 2016 Guidelines are radically different because, under them, the Minister does not receive any "schedule" of refused initial requests. Without the receipt of that "schedule", the Minister, it was said, had effectively abandoned the exercise of his or her power to the Department. A consideration of Plaintiff S10 and SZSSJ does not support the distinction sought to be drawn by the appellants. Instead, it shows that the two guidelines are materially the same: neither affected rights and obligations; neither, when applied by the Department, constituted an exercise of power; and each, when issued, was an entirely valid exercise of the Minister's executive power as a Minister of State pursuant to s 64 of the Constitution and as part of the execution and maintenance of the laws of the Commonwealth pursuant to s 61 of the Constitution. As to the validity of the 2009 Guidelines, Gummow, Hayne, Crennan and Bell JJ said in Plaintiff S10224: "The terms of the guidelines provide criteria to distinguish between requests which will not be referred to the Minister and those which may be referred to the Minister for consideration whether to exercise the relevant power. By these directions the Minister has determined in advance the circumstances in which he or she wishes to be put in a position to consider exercise of the discretionary powers by the advice of department officers. It was within the competence of the Minister to do so". (emphasis added) The reference in the foregoing passage to requests "which will not be referred to the Minister" was a clear acknowledgment by their Honours that the 2009 Guidelines provided for this outcome in, for example, the case of repeat requests. Yet this did not render the application of the 2009 Guidelines an impermissible delegation of power or an act which exceeded the executive power of the Commonwealth. That is precisely because whether a departmental referral is or is not made, no statutory power is exercised. As French CJ and Kiefel J said in Plaintiff S10225: "If, on ministerial instructions, certain classes of request or case are not even to be submitted to him or her for consideration, the position in law is unchanged. There is no exercise of a statutory power under the Act conditioned upon compliance with the requirements of procedural fairness. The plaintiffs' submissions that the issue of ministerial guidelines in relation to the dispensing provisions involved a decision by the Minister to decide to consider the exercise of the powers conferred by those provisions, should be rejected. So too should the proposition that the processes followed under the guidelines were steps towards the exercise of the ministerial powers." (emphasis added) 224 (2012) 246 CLR 636 at 665 [91]. 225 (2012) 246 CLR 636 at 655 [50]-[52]. The foregoing passage was expressly approved in SZSSJ226. Earlier, in Plaintiff S10, French CJ and Kiefel J accepted a submission that the 2009 Guidelines did no more than facilitate the provision of advice. Their Honours said227: "It was submitted for the Minister and the Secretary that, properly understood, each of the guidelines in this case does no more than facilitate the provision of advice to the Minister in particular cases and otherwise operate as a screening mechanism in relation to any requests which the Minister has decided are not to be brought to his or her attention. The issue of the guidelines itself did not involve a decision on the part of the Minister, acting under the relevant section, to consider the exercise of the power conferred by it. That submission should be accepted." With respect, the foregoing conclusion applies equally to the 2016 Guidelines. The possibility that more cases under those guidelines will not be referred to the Minister than under the 2009 Guidelines does not deny the conclusion that in each case the purpose of each of the guidelines is advisory and neither calls for an exercise of power by the Department. The difference between the two guidelines is only administrative in nature. That the difference is of no relevant moment is also reflected in the fact that in Plaintiff S10 it was understood by this Court that the Department had not referred the cases of some of the plaintiffs to the Minister228. But this did not result in a conclusion that in those cases there had been an act in excess of power, even though, it will be recalled, the criteria for the consideration of repeat requests under the 2009 Guidelines included evaluative, non-objective issues for analysis (just like the 2016 Guidelines). Nor did it otherwise render that part of the 2009 Guidelines invalid. 226 (2016) 259 CLR 180 at 199 [47], [50] per French CJ, Kiefel, Bell, Gageler, Keane, 227 (2012) 246 CLR 636 at 653 [46]. 228 See Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 643 [7], [10] per French CJ and Kiefel J; Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 199 [46] per French CJ, Kiefel, Bell, Gageler, Keane, Nettle and Gordon JJ. In SZSSJ, all members of this Court reached the same conclusion about how the 2009 Guidelines operated. The Court summarised the relevant principles to be derived from Plaintiff S10 as follows229: "Members of the Court [in Plaintiff S10], with the possible exception only of Heydon J, interpreted the guidelines as directed to when the Department was to refer cases to the Minister in order to allow the Minister to decide whether or not to consider exercising a non-compellable power: where the Department had not referred a case to the Minister, no statutory power had been engaged; where the Department had referred a case to the Minister and the Minister had indicated that he would 'not intervene', the Minister had made a personal decision that he would not consider exercising any of the non-compellable powers". (emphasis added) It is true that the appellants' argument in these appeals – that the non-referral of cases to the Minister was an effective abandonment of power – was not one directly addressed in either Plaintiff S10 or SZSSJ. But it is the decisive conclusion reached in both decisions that the act of non-referral did not involve any actual exercise of power which renders that argument unsustainable. Judicial review of power The foregoing is supported by fundamental principles of public law. First, judicial review is concerned with the lawful exercise of executive power230. As Brennan J explained in Quin231: "The essential warrant for judicial intervention is the declaration and enforcing of the law affecting the extent and exercise of power: that is the characteristic duty of the judicature as the third branch of government." Power, it should be accepted in this context, is the capacity to interfere with or legally alter rights, obligations and legally recognised interests. For the purposes of the Constitution, this type of power has three relevant sources. As Brennan J observed in Davis v The Commonwealth232: 229 Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 199 [47] per French CJ, Kiefel, Bell, Gageler, Keane, Nettle and Gordon JJ. 230 Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 26 per Brennan J. 231 (1990) 170 CLR 1 at 35. 232 (1988) 166 CLR 79 at 108-109; see also Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 97 [132] per "[A]n act done in execution of an executive power of the Commonwealth is done in execution of one of three categories of powers or capacities: a statutory (non-prerogative) power or capacity, a prerogative (non-statutory) power or capacity, or a capacity which is neither a statutory nor a prerogative capacity. The relevant statute defines the scope of a power or capacity in the first category, but there is no express criterion by which non- statutory powers and capacities may be classified as falling within the executive power of the Commonwealth." An exercise of power, in this context, is not, for example, influencing a decision maker; it is not facilitating an exercise of power; it is not advising on an exercise of power; and it is not providing merely administrative support to an exercise of power. Subject to any statutory modification of the common law, the ability to influence, facilitate, advise upon and support an exercise of power may have practical consequences; but none of those acts can be amenable to judicial review unless it constitutes in and of itself an exercise of power, or is a necessary legal condition for the exercise of power. Otherwise, those acts are all steps anterior to an exercise of power. The observations of the Full Court of the Supreme Court of South Australia in L v South Australia233 are apposite. The plaintiffs in that case sought judicial review in relation to a report published by a governmental child protection unit that recommended the removal of foster children from the plaintiffs' care. Kourakis CJ defined "power" as234: "the legal authority to affect a legal right or interest by abrogating, diminishing, limiting or extending it. It does not refer to the financial, human and other resources of a person, or the executive government, to influence conduct in fact, nor to any imbalance between the power, in that sense, of one person when pitted against another." As his Honour went on to conclude, it is critical in the exercise of a court's supervisory jurisdiction not "to conflate the question of practical economic and social power with a legal power to affect existing rights and interests"235. For the reasons already given, the application of the 2016 Guidelines to each appellant did not constitute an exercise of power amenable to judicial review. Each application of the 2016 Guidelines was an anterior exercise designed to 233 (2017) 129 SASR 180. 234 (2017) 129 SASR 180 at 216 [136]. 235 (2017) 129 SASR 180 at 221 [152]; cf Victoria v Master Builders' Association of Victoria [1995] 2 VR 121. Steward facilitate the provision in some cases of advice to the Minister and otherwise to operate as a screening mechanism for requests the Minister did not generally wish to consider236. That is what this Court decided in relation to the 2009 Guidelines; the omission of the schedule, described above, from the 2016 Guidelines makes no difference to that outcome. Holding a relevant legal right or interest The appellants' case suffered from another important but related difficulty. Whilst they arguably had standing to bring these proceedings, they never held any relevant legal right or interest that could be altered or interfered with by an exercise of power. That is precisely because the Minister was under no duty to consider whether to make a procedural decision or a substantive decision under s 351 of the Act. In that respect, the Solicitor-General of the Commonwealth's submission that it would have been entirely lawful for the Minister to have instructed the Department that he or she would never exercise the power conferred by s 351 should be accepted. Neither appellant could compel any contrary outcome. It follows that the appellants only had an expectation – perhaps a legitimate expectation – that the 2016 Guidelines would be applied accurately. But such an expectation will not, in this country, justify the imposition of public law remedies. As Brennan J observed in Quin237: "[W]hen an administrative power is conferred by the legislature on the executive and its lawful exercise is apt to disappoint the expectations of an individual, what is the jurisdiction of the courts to protect that individual's legitimate expectations against adverse exercises of the power? I have no doubt that the answer is: none. Judicial review provides no remedies to protect interests, falling short of enforceable rights, which are apt to be affected by the lawful exercise of executive or administrative power." In argument, the only legal interest or right that the appellants asserted could have been affected by the application of the 2016 Guidelines to their pending requests was their possible eligibility for a bridging visa pursuant to cl 050.212(6) of Sch 2 to the Migration Regulations 1994 (Cth). Entitlement for the issue of this visa arises when an applicant makes a request for the Minister to exercise his or her power under s 351(1) of the Act, subject to other requirements in cl 050.212 being met. Visas of this type are issued with a date of expiration which may or may not correspond to the time taken by the Department to consider a request238. 236 Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 653 [46] per French CJ and Kiefel J. 237 (1990) 170 CLR 1 at 35. 238 Migration Regulations 1994 (Cth), Sch 2, cl 050.517. They also cannot be issued to a person who has made a repeat request for the exercise of the s 351 power239. It was not clear whether either of the appellants held a bridging visa under cl 050.212(6) or of another kind at the time of their requests and throughout these appeals240. Having previously made three requests for ministerial intervention under s 351 of the Act, DCM20 cannot have been legally eligible for a bridging visa under cl 050.212(6) regardless of the outcome of her fourth request, the non- referral of which was the subject of her appeal. On the other hand, assuming for present purposes that Mr Davis did hold such a bridging visa, the holding of this visa was also legally unaffected by the application of the 2016 Guidelines to his circumstances. His legal entitlement to this visa arose regardless of how his request was to be addressed by the Department and the Department's recommendation not to refer his request to the Minister could not affect the characterisation of any future request made by him as a repeat request. At most, such a recommendation simply made it more likely that another request might be made in the future, at which point, like DCM20, Mr Davis would not be eligible for the grant of another bridging visa of the same kind. Remedies and islands of power Two more matters should be addressed. First, there is the issue of what remedies may be available. Here, each appellant sought a declaration that the 2016 Guidelines are "inconsistent with and repugnant to" s 351 of the Act. Given that the 2016 Guidelines have no legal effect, it is immediately difficult to see how any such repugnance or inconsistency can arise. In any event, the majority favour a different declaration, namely that each "decision made ... in purported compliance with section [10] of the 2016 [Guidelines] exceeded the executive power of the Commonwealth"241. With great respect, there was no obligation of compliance and, for the reasons given already, there was no exercise of executive power when the Department declined to refer either request to the Minister. 239 Migration Regulations 1994 (Cth), Sch 2, cl 050.212(6)(c)(i). 240 See Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 29 [11] per Kenny J, 47 [85] per Griffiths J, 55 [119] per Mortimer J. 241 See reasons of Kiefel CJ, Gageler and Gleeson JJ at [63]-[64], Gordon J at [66], Edelman J at [195], Jagot J at [324]. In Quin, Brennan J warned against the making of declarations where "the availability of a substantive remedy is doubtful"242. Here, what in substance can either appellant achieve? The majority's proposed declarations secure nothing. That is because if the Department's consideration of each request was a nullity, neither appellant can, as a result, force the Minister to consider their requests anew. They have no legal right to advance their respective cases. Nor do the proposed declarations in any way touch upon or concern the Minister's statutory power to make a procedural decision and, if needed, a substantive decision in relation to either appellant. Save for the future administration generally by the Department of the receipt of requests to exercise the power conferred by s 351, the proposed declarations are inutile. Secondly, in Kirk v Industrial Court (NSW), it was said243: "To deprive a State Supreme Court of its supervisory jurisdiction enforcing the limits on the exercise of State executive and judicial power by persons and bodies other than that Court would be to create islands of power immune from supervision and restraint." It might be thought that the inability to seek judicial review of the application of the 2016 Guidelines to each of the requests made by the appellants is "to create islands of power immune from supervision and restraint". But that is not so, precisely because no power has here been exercised. Consistently with Quin, the internal processes of a Department of State, which do not involve the exercise of power as described in these reasons, are normally immune from judicial scrutiny. Any other conclusion would permit unnecessary and unwieldy challenges to the administration of government before any statutory or executive power is in fact exercised. Legal unreasonableness It follows from the foregoing reasoning that because the act of declining to make each referral was not an exercise of power, it could not be subject to judicial review on the ground of legal unreasonableness. That doctrine has in Australia historically existed only as an implication which follows from a grant of statutory power244. The cases referenced by the Full Court below support that proposition. 242 (1990) 170 CLR 1 at 31. 243 (2010) 239 CLR 531 at 581 [99] per French CJ, Gummow, Hayne, Crennan, Kiefel 244 See, eg, R v Anderson; Ex parte Ipec-Air Pty Ltd (1965) 113 CLR 177 at 189 per Kitto J; Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 36 per Brennan J; Kruger v The Commonwealth (1997) 190 CLR 1 at 36 per Brennan CJ; Re Refugee Steward Rooke's Case245 concerned the exercise of a statutory discretion conferred by the Statute of Sewers 1531 (23 Hen VIII c 5). It was that power that had to be exercised "with the rule of reason and law"246. Similarly, Sharp v Wakefield247 concerned the exercise of a statutory discretion conferred by successive Acts which commenced with the Alehouse Act 1828 (9 Geo IV c 61). The discretion was one which could not lawfully be exercised in an "arbitrary, vague, and fanciful" way248. There is otherwise no authority in Australia so far that supports the existence of a freestanding measure of reasonableness which conditions the exercise of all power other than that conferred by statute. I otherwise respectfully agree with the conclusion reached by all of the judges of the Full Court below that the application of the 2016 Guidelines in the case of each appellant was not legally unreasonable249. In the case of Mr Davis, a man who has led a blameless and law-abiding life for a considerable period of time in this country, the initial reasons for declining to refer his case to the Minister might fairly be characterised as ungenerous and somewhat unsatisfactory. The subsequent reasons treated Mr Davis' follow-up request – seeking reconsideration of certain "elements" that had not been addressed by the Department – as a "repeat request". As such, these reasons might fairly be considered to be perhaps even more ungenerous and unsatisfactory. But the boundaries of "decisional freedom" Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 100-101 [40] per Gaudron and Gummow JJ; Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 350-351 [26]-[28] per French CJ, 362-363 [63]-[64] per Hayne, Kiefel and 245 (1597) 5 Co Rep 99b [77 ER 209]. 246 (1597) 5 Co Rep 99b at 100a [77 ER 209 at 210]. See also Keighley's Case (1609) 10 Co Rep 139a at 140a [77 ER 1136 at 1138]; Estwick v City of London (1647) Style 42 at 43 [82 ER 515 at 516]; R v Commissioners of the Fens (1666) 2 Keble 248 [1891] AC 173 at 179 per Lord Halsbury LC. 249 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 at 27 [3] per Kenny J, 38 [54]-[55] per Besanko J, 51 [97] per Griffiths J, 54 [118] per Mortimer J, 94-95 [324]-[329], 101-103 [356]- will often encompass reasoning which might be unsatisfactory, but which is Conclusion The appeals should be dismissed. 250 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 350-351 [28] Jagot JAGOT J. These two appeals should be allowed. Whatever its precise scope and nature, the executive power referred to in s 61 of the Constitution did not enable the Minister to issue, and the officers of the Minister's department to implement, instructions which purported to require officers of the department to decide matters within the zone of exclusive Ministerial personal decision-making power created by s 351 of the Migration Act 1958 (Cth) ("the Act"). The zone of exclusive Ministerial personal decision-making power created by s 351 of the Act qualifies both an exercise of the statutory power in s 351(1) and an exercise of non-statutory executive power under s 61 of the Constitution in connection with s 351(1). Without impermissibly acting within that exclusive zone, departmental officers may implement any decision of the Minister under s 351(1), be that a decision about a particular request, classes of requests (existing or prospective), or all requests (existing or prospective). They may also provide all such assistance, advice, and analysis the Minister may require so that the Minister may exercise any aspect of the s 351(1) power. In contrast to these forms of permissible conduct, the instructions from the Minister to the department in issue in these appeals impermissibly required the departmental officers to decide matters within the zone of exclusive Ministerial personal decision-making power created by s 351 of the Act. This is because the instructions required the departmental officers to decide that the request of each appellant did not meet certain evaluative "public interest" criteria and, without referral to the Minister, to finalise the request. In finalising the request of each appellant for a more favourable decision under s 351(1) of the Act in purported compliance with the Minister's instructions, the departmental officers acted impermissibly. Background Having failed in their respective applications to the relevant tribunals251 to obtain the grant of a visa, each appellant requested the Minister to exercise power under s 351(1) of the Act. Section 351 provides that: If the Minister thinks that it is in the public interest to do so, the Minister may substitute for a decision of the Tribunal under section 349 another decision, being a decision that is more favourable to the applicant, whether or not the Tribunal had the power to make that other decision. 251 Now the Administrative Appeals Tribunal ("the Tribunal"). Jagot The power under subsection (1) may only be exercised by the Minister personally. The Minister does not have a duty to consider whether to exercise the power under subsection (1) in respect of any decision, whether he or she is requested to do so by the applicant or by any other person, or in any other circumstances." In each case, an officer of the Minister's department decided that the request should not be referred to the Minister and should be "finalised" by the department. These decisions were made applying an instruction from the Minister to the department issued in March 2016, "Minister's guidelines on ministerial powers (s351, s417 and s501J)" ("the Minister's Instructions 2016"). The Minister's Instructions 2016 were not issued as directions from the Minister to a person or body having functions or powers under the Act in accordance with s 499. Each appellant challenged the decision of the departmental officer primarily on the ground that the decision was legally unreasonable and sought consequential orders to the effect that their request for Ministerial intervention under s 351(1) was not finalised. Having failed at first instance252, each appellant then appealed to the Full Court of the Federal Court of Australia. The Full Court heard and determined the appeals together253. The appeals below proceeded on the basis that the departmental officers' assessment of each appellant's request and the officers' resulting decisions not to refer the requests to the Minister and to finalise the requests in purported compliance with the Minister's Instructions 2016 did not involve any exercise of statutory power but, rather, were "the exercise of non-statutory powers" derived from ss 61 and 64 of the Constitution254. 252 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCA 791; DCM20 v Secretary, Department of Home Affairs [2020] FCA 1022. 253 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2021) 288 FCR 23 ("Davis v Minister"). 254 Davis v Minister (2021) 288 FCR 23 at 85 [284], 89-90 [306] per Charlesworth J, Kenny J agreeing at 29 [12]-[14], Besanko J agreeing at 38 [54]-[55], Griffiths J agreeing at 38 [56], 41-42 [63]-[64], 48 [88], Mortimer J agreeing at 54 [117], 66 Jagot The Full Court dismissed each appeal on the basis that, although the impugned decisions of the departmental officers were amenable to judicial review on the ground of legal unreasonableness, the decisions were not legally unreasonable255. In so doing, the Full Court (by majority) also refused to grant Mr Davis leave to raise a second ground in his appeal challenging the lawfulness of the Minister's Instructions 2016256. Mr Davis was granted special leave to appeal including on the new second ground and, during the hearing of the appeals, sought leave to amend his notice of appeal to seek additional declaratory relief to the effect that the Minister's Instructions 2016 are inconsistent with and repugnant to ss 351, 417, and 501J of the Act. During the hearing of the appeals, DCM20 sought leave to amend her notice of appeal to raise the second ground and to seek a declaration in the same terms as Mr Davis. Leave to amend and special leave to raise the second ground as sought should be granted. Sections 417 and 501J of the Act, like s 351, give the Minister a personal and non-compellable power to substitute for a decision of the Tribunal a decision more favourable to the applicant if the Minister thinks it is in the public interest to do so. In accordance with the position of the parties below, they proceeded in this Court on the basis that the issue and implementation of the Minister's Instructions 2016 did not involve the exercise of any statutory power but, rather, involved the exercise of executive power referred to in ss 61 and 64 of the Constitution. The new ground concerning the legal status of the Minister's Instructions 2016 logically precedes the dispute between the parties as to whether the actions of the departmental officers are amenable to judicial review on the ground of legal unreasonableness. As the new ground should succeed, it is the focus of these reasons. 255 Davis v Minister (2021) 288 FCR 23 at 27 [3] per Kenny J, 37 [49]-[50], 38 [54]- [55] per Besanko J, 50-51 [96]-[97], 53 [112]-[113] per Griffiths J, 54 [116]-[118] per Mortimer J, 89 [302], 95 [327], 103 [363] per Charlesworth J. 256 Davis v Minister (2021) 288 FCR 23 at 95 [330]-[332] per Charlesworth J, Kenny and Griffiths JJ agreeing at 37 [47], 53-54 [114(b)] respectively. Jagot The power involved Chapter II of the Constitution concerns the executive power of the Commonwealth257. The executive power of the Commonwealth is "all that power of a polity that is not legislative or judicial power"258. By s 61, the "executive power of the Commonwealth is vested in the Queen and is exerciseable by the Governor-General as the Queen's representative, and extends to the execution and maintenance of this Constitution, and of the laws of the Commonwealth". By s 62, there "shall be a Federal Executive Council to advise the Governor-General in the government of the Commonwealth". By s 63, the "provisions of this Constitution referring to the Governor-General in Council shall be construed as referring to the Governor-General acting with the advice of the Federal Executive Council". Section 64 concerns Ministers of State and provides, relevantly, that: "The Governor-General may appoint officers to administer such departments of State of the Commonwealth as the Governor-General in Council may establish." By s 65, Ministers "shall hold such offices as the Parliament prescribes, or, in the absence of provision, as the Governor-General directs". Section 67 concerns the appointment of civil servants and provides that: "Until the Parliament otherwise provides, the appointment and removal of all other officers of the Executive Government of the Commonwealth shall be vested in the Governor-General in Council, unless the appointment is delegated by the Governor-General in Council or by a law of the Commonwealth to some other authority." Section 51 provides that the Parliament "shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to", relevantly: "(xxxix) matters incidental to the execution of any power vested by this Constitution in the Parliament or in either House thereof, or in the Government of the Commonwealth, or in the Federal 257 In contrast to the legislative power of the Commonwealth, which is vested in Federal Parliament (s 1) and is subject to Ch I of the Constitution, and the judicial power of the Commonwealth, which is vested in this Court (s 71) and is subject to Ch III of the Constitution. 258 Williams v The Commonwealth [No 2] (2014) 252 CLR 416 at 468 [78]. Jagot Judicature, or Commonwealth." in any department or officer of the Under s 75, this Court has original jurisdiction in all matters, relevantly: "(iii) in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party; in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth." In the present cases, the Minister issued the Minister's Instructions 2016 to the department and the officers of the department purported to comply with those Instructions for the purposes of, but not by exercise of any power under, the Act. Accordingly, the relevant provision is s 61 of the Constitution insofar as it refers to executive power extending to the "execution and maintenance ... of the laws of the Commonwealth"259. This aspect of s 61 of the Constitution has been said to be "a function characteristically to be performed by execution of statutory powers"260, but is not so confined261. In providing that the executive power of the Commonwealth "extends to the execution and maintenance of this Constitution, and of the laws of the Commonwealth", s 61, as Isaacs J said, "marks the external boundaries of the Commonwealth executive power, so far as that is conferred by the Constitution, but it leaves entirely untouched the definition of that power and 259 That is, the power exercised was a non-statutory and non-prerogative power as described in Davis v The Commonwealth (1988) 166 CLR 79 at 108. Having identified the prerogative powers as those enjoyed by the Crown alone, Brennan J said that "an act done in execution of an executive power of the Commonwealth is done in execution of one of three categories of powers or capacities: a statutory (non- prerogative) power or capacity, a prerogative (non-statutory) power or capacity, or a capacity which is neither a statutory nor a prerogative capacity". See also Clough v Leahy (1904) 2 CLR 139 at 156. 260 Davis v The Commonwealth (1988) 166 CLR 79 at 109. 261 eg, Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 455, 464; Williams v The Commonwealth (2012) 248 CLR Jagot its ascertainment in any given instance"262. As such, this is the "essential starting-point, and the extent it marks out cannot be exceeded"263. The Minister's Instructions 2016 The Minister's Instructions 2016, while called "Minister's guidelines on ministerial powers (s351, s417 and s501J)", are appropriately identified as instructions from the Minister as an officer appointed under s 64 of the Constitution to other officers of the Executive Government of the Commonwealth appointed under s 67. This is reinforced by the fact that the document identifies itself as a "departmental instruction" which is "part of the centralised departmental instructions system". The principle on which the present cases are to be resolved, that if an exercise of executive power is confined by statute effect must be given to that statutory limitation, depends on the substance and not the form of the Minister's Instructions 2016. The Minister's Instructions 2016 explain their purpose in s 1 as being to: explain the circumstances in which I may wish to consider intervening in a case explain how a person may request that I consider intervening in their case explain when my Department should refer a case to me confirm that if a case does not meet these guidelines, I do not wish to consider intervening in that case." In s 2, which explains the powers in ss 351, 417, and 501J, the Minister's Instructions 2016 explain that: "What is and what is not in the public interest is for me to determine." Section 3 of the Minister's Instructions 2016 explains some general principles, such as that it is the Minister's "general expectation that a person who has not been granted a visa through the statutory visa process will leave Australia". 262 The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 437. 263 The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 438. Jagot The Minister's Instructions 2016 next contain the heading "Cases that should be brought to my attention". Section 4 which immediately follows is headed "Unique or exceptional circumstances". It provides that cases "that have one or more unique or exceptional circumstances, such as those described below, may be referred to me for possible consideration of the use of my intervention powers". The description below includes, for example: strong compassionate circumstances that if not recognised would result in serious, ongoing and irreversible harm and continuing hardship to an Australian citizen or an Australian family unit ... compassionate circumstances regarding the age and/or health and/or psychological state of the person that if not recognised would result in serious, ongoing and irreversible harm and continuing hardship to the person circumstances not anticipated by relevant legislation; or clearly unintended consequences of legislation; or the application of relevant legislation leads to unfair or unreasonable results in a particular case". Another section which follows is headed "Cases that should not be brought to my attention". Section 7 is headed "Inappropriate to consider". It says that: "Cases which do not meet these guidelines for referral, and with the types of circumstances described below, are inappropriate for me to consider. The Department will finalise these cases without referral to me and advise the person or their authorised representative in writing". The subsequent list includes such matters as "the person's visa has been cancelled because they breached their visa conditions", "the person has had a visa refused because they did not comply with the conditions of a previous visa", or "the person has been refused a visa or has had a visa cancelled on character grounds". The next section of the Minister's Instructions 2016 is headed "Requesting Ministerial intervention". Section 8 specifies who can make a request for intervention ("generally only ... a person who is the subject of the request or their authorised representative"). Section 9 specifies how to make a request (in writing). Section 10 specifies how requests for Ministerial intervention will be progressed. Section 10.1 deals with "First requests". It says that a "request is a 'first request' if I or another Minister ... have not previously received a request to intervene in the person's case ... under any of the powers covered in these guidelines". Section 10.1 continues: Jagot "If the Department assesses that the case has unique or exceptional circumstances such as those described in section 4 of these guidelines, it will be brought to my attention in a submission. I may consider intervening if I think it is in the public interest to do so. If the Department assesses that the case does not have unique or exceptional circumstances such as those described in section 4 of these guidelines and is inappropriate for me to consider, as described in section 7 of these guidelines, it will not be brought to my attention. If the Department assesses that the case does not have unique or exceptional circumstances such as those described in section 4 of these guidelines, and is not inappropriate for me to consider, it will be finalised by the Department without referral to me. If I do not wish to intervene or consider intervening in the case, whether or not it has been referred to me, the Department will reply on my behalf to the person or their authorised representative that I do not wish to intervene or consider intervening in that case." Section 10.2 concerns repeat requests. It provides that a "request is a 'repeat request' if I or another Minister (current or previous) have previously received a request to intervene in the person's case ... under any of the powers covered in these guidelines". Section 10.2 continues: "I do not wish to consider repeat requests. Where I or another Minister (current or previous) have declined to intervene or consider intervening in a case, I expect the person concerned to leave Australia. In limited circumstances, a repeat request may be referred to me if: the Department is satisfied there has been a significant change in circumstances since the previous request(s) which raises new, substantive issues that were not provided before or considered in a previous request; and the Department assesses that these new, substantive issues fall within the unique or exceptional circumstances described in section 4 of these guidelines. Otherwise, the Department should reply on my behalf to the person or their authorised representative that I do not wish to consider intervening in the case." Jagot Section 12 provides that: "My powers to intervene in an individual case, where I believe it is in the public interest to do so, exist whether or not the case is brought to my attention in the manner described above, as long as a decision has been made by a relevant review tribunal and that decision continues to exist (for example, the review tribunal decision has not been overturned by a court). I may consider intervening in cases where the circumstances do not fall within the unique or exceptional circumstances as described in section 4 of these guidelines, if I consider it to be in the public interest. Where I believe it is appropriate, I will seek further information to help me to determine whether to consider intervening in a case." As will be explained, the key point about the Minister's Instructions 2016 is that departmental officers are to assess if the case to which the request relates has unique or exceptional circumstances such as those described in s 4 of the Instructions. If not, and subject to the Minister's overriding power to intervene in any case as recorded in s 12, the department is to finalise the request without referral to the Minister. The dispute about the Minister's Instructions 2016 The appellants' challenges The appellants' principal contention was that, to the extent the Minister's Instructions 2016 "delegate power to a Departmental officer to finalise a request without notice to the Minister on the basis that it does not raise unique or exceptional circumstances or involve the public interest, the [Instructions] are inconsistent with the personal and non-delegable discretionary powers conferred on the Minister by s 351(1) and (3)" of the Act. This contention raises two further issues: first, the jurisdiction of the Full Court of the Federal Court of Australia to hear and determine the appeals against the orders dismissing each appellant's originating application, and second, the standing of the appellants, which, in federal jurisdiction, is related to the existence of a matter or justiciable controversy involving "some immediate right, duty or liability to be established by the determination of the Court"264. These further 264 In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; see also CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 368 [85]; Hobart International Airport Pty Ltd v Clarence City Council (2022) 96 ALJR 234 at 245-246 [29]-[31], 249-250 [49], 256-257 [79]; 399 ALR 214 at 223, 228, 237. Jagot issues are readily resolved in respect of the challenges to the Minister's Instructions 2016 and the declaratory relief sought in consequence. Jurisdiction Section 476A of the Act limits the jurisdiction of the Federal Court. It provides, in sub-s (1), that "[d]espite any other law, including section 39B of the Judiciary Act 1903 ... the Federal Court has original jurisdiction in relation to a migration decision if, and only if" specified criteria are satisfied. For present purposes, the key words in this provision are "in relation to a migration decision". That is, the jurisdiction the Federal Court would otherwise have under, relevantly, s 39B of the Judiciary Act 1903 (Cth) is not excluded in the present cases if the matter is not "in relation to a migration decision". A "migration decision" is defined in s 5(1) of the Act to mean a "privative clause decision", a "purported privative clause decision", a "non-privative clause decision", or an "AAT Act [Administrative Appeals Tribunal Act 1975 (Cth)] migration decision". Of these, the first three are relevant. The meanings the Act gives to each of these three terms in ss 5E, 474(2), and 474(6) require the impugned decision to be made, proposed to be made, or required to be made, in effect, under the Act. As noted, the Minister issued the Minister's Instructions 2016 to the department and the officers of the department purported to implement those Instructions for the purposes of, but not by exercise of any power under, the Act. It follows that the limit on the jurisdiction of the Federal Court imposed by s 476A of the Act was not engaged in the present cases. The Federal Court had jurisdiction to hear and determine the appeals under, at least, s 39B(1), (1A)(b), and (1A)(c) of the Judiciary Act. Accordingly, this Court has jurisdiction to hear and determine the appeals under s 73(ii) of the Constitution. In so doing, this Court "may give such judgment as ought to have been given in the first instance" as provided for in s 37 of the Judiciary Act. Standing/"matter" In the context of the challenges to the decisions of the departmental officers on the ground of legal unreasonableness, the appellants contended that finalisation of their respective requests by the departmental officers without referral to the Minister in purported compliance with the Minister's Instructions 2016: (a) foreclosed the possibility of the Minister exercising power to substitute a more favourable decision; (b) rendered any further request a "repeat request" under the Minister's Instructions 2016; and (c) excluded their eligibility for the grant of a bridging visa265. Accordingly, the appellants said that their legal rights were affected by the impugned decisions such as to render the decisions capable of 265 By operation of cl 050.212(6)(c) of Sch 2 to the Migration Regulations 1994 (Cth). Jagot judicial review at the suit of each appellant. In response, the Solicitor-General of the Commonwealth submitted that the decisions were not amenable to judicial review as the officer's conduct in each case was incapable of affecting any legal right of the appellants266. This was said to result from the fact that the Minister had no duty to consider exercising any power under s 351(1) by operation of s 351(7) of the Act. This dispute between the parties need not be resolved. The new ground the subject of the grants of leave in this Court relates to the legal status of the Minister's Instructions 2016 and the actions of the departmental officers under those Instructions. The relief sought involves related declarations as of right. It was not (and could not be) suggested that the appellants did not each have a "real", "sufficient", "special", or "sufficient material" interest267 in respect of these matters to support their claims for declaratory relief. The implementation of the Minister's Instructions 2016 resulted in each appellant's request for the exercise of Ministerial power under s 351(1) of the Act being finalised without referral to the Minister. If that implementation exceeded the executive authority of the departmental officers, each appellant's request for Ministerial intervention would remain undetermined in law268. Accordingly, an appropriately framed declaration would produce 266 Citing, in support, eg, The Church of Scientology Inc v Woodward (1982) 154 CLR 25 at 70; Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 35-36; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 585; Griffith University v Tang (2005) 221 CLR 99 at 128 [80]; Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 641-642 [2]-[3], 665 [91] (citing Raikua v Minister for Immigration and Multicultural and Indigenous Affairs (2007) 158 FCR 510 at 522-523 [63]-[66]) ("Plaintiff S10"); Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship (2013) 251 CLR 322 at 380 [184]; Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 98 [134]-[135]; cf Plaintiff M61/2010E v The Commonwealth (2010) 243 CLR 319 at 353 [76] ("Plaintiff M61") (in which the Minister's consideration of a statutory power "affected [the claimants'] rights and interests directly because the decision to consider the exercise of those powers, with the consequential need to make inquiries, prolonged their detention for so long as the assessment and any necessary review took to complete"). 267 eg, The Church of Scientology Inc v Woodward (1982) 154 CLR 25 at 71; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 35-36, 41-42, 43, 44, 62-63, 72-76; Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 265-266 [46], 267 [50], 280-284 [92]-[103]. 268 cf Minister for Immigration and Ethnic Affairs v Mayer (1985) 157 CLR 290 at 300, in which the Minister's functions were "without any identified statutory foundation, undefined by any identified statutory obligation or control and devoid of any direct Jagot "foreseeable consequences"269 for each appellant. It follows that there is a matter in each appeal and each appellant has the requisite standing to pursue that matter270. Exceeding power The scope of executive power under s 61 of the Constitution271 in the present cases involves the fundamental concept of parliamentary supremacy. Parliamentary supremacy dictates that "it is of the very nature of executive power in a system of responsible government that it is susceptible to control by the exercise of legislative power by Parliament"272. It follows that the "Executive cannot change or add to the law; it can only execute it"273. In the words of Brennan J274: "The incapacity of the executive government to dispense its servants from obedience to laws made by Parliament is the cornerstone of a parliamentary democracy." statutory or legal effect"; Minister for Immigration and Multicultural Affairs v Ozmanian (1996) 71 FCR 1 at 31-33 per Kiefel J, Sackville J agreeing at 30. 269 Plaintiff M61 (2010) 243 CLR 319 at 359-360 [103], citing Gardner v Dairy Industry Authority (NSW) (1977) 52 ALJR 180 at 188, 189; 18 ALR 55 at 69, 71. See also Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 75 [59], 76 [64], 90 [112], 122 [230], 152 [350]. 270 Croome v Tasmania (1997) 191 CLR 119 at 125. 271 See, in respect of the concept of "capacity" in the context of the exercise of executive power, Williams v The Commonwealth (2012) 248 CLR 156 at 252-253 [201]-[203]. 272 Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 441 (footnote omitted), see also at 459 referring to Attorney-General v De Keyser's Royal Hotel [1920] AC 508 at 526, 537-540, 549- 550, 561-562, 575-576 and Brown v West (1990) 169 CLR 195 at 205; Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 70 [85]. 273 R v Kidman (1915) 20 CLR 425 at 441. See also Williams v The Commonwealth (2012) 248 CLR 156 at 232 [135]. 274 A v Hayden (1984) 156 CLR 532 at 580. Jagot The relevant constitutional principle is that275: "Whatever the scope of the executive power of the Commonwealth might otherwise be, it is susceptible of control by statute. A valid law of the Commonwealth may so limit or impose conditions on the exercise of the executive power that acts which would otherwise be supported by the executive power fall outside its scope." This being so, the next question involves the construction of the Act, in particular s 351 itself. The key aspects of s 351 are that: (a) sub-s (1) vests the relevant power in the Minister (to substitute for a decision of the Tribunal a decision more favourable to the applicant); (b) by sub-s (1), that power is contingent on the Minister thinking it is in the public interest to do so; (c) by sub-s (2), the Minister does not have to comply with certain provisions of the Act or the whole of the Migration Regulations 1994 (Cth); (d) by sub-s (3), the power may only be exercised by the Minister personally; (e) by sub-s (4), if the Minister substitutes a decision under sub-s (1), the Minister is to cause a statement to be laid before each House of Parliament that sets out specified matters including the reasons for the decision; and (f) by sub-s (7), the Minister has no duty to consider exercising the power in any circumstances. These provisions, operating together, create the zone of exclusive Ministerial personal decision-making power to which I have referred. Section 351(3), construed in the context of the whole provision, has several consequences. It excludes the capacity which the Minister otherwise would have under s 496(1) of the Act to delegate the exercise of the power in s 351(1). It also qualifies the operation of what is known as the Carltona principle, which is an exception to the "obvious proposition that a statute which on its proper construction confers a power on A does not permit the power to be exercised by B"276. In Carltona Ltd v Commissioners of Works277, Lord Greene MR explained that, given the nature and number of decisions required to be made under the regulation there in question, the regulation could not be construed as meaning that the "minister in person should direct his mind to the matter"278. Rather, the 275 Brown v West (1990) 169 CLR 195 at 202. See also, eg, Davis v The Commonwealth (1988) 166 CLR 79 at 108; CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514 at 600-601 [279]. 276 Racecourse Co-operative Sugar Association Ltd v Attorney-General (Q) (1979) 142 CLR 460 at 481. 277 [1943] 2 All ER 560. 278 [1943] 2 All ER 560 at 563. Jagot Minister's departmental officers could act as the Minister's decision-making agents. In Minister for Aboriginal Affairs v Peko-Wallsend Ltd279, Mason J explained that the Carltona principle "partly depends on the special position of constitutional responsibility which Ministers occupy and on the recognition that the functions of a Minister are so multifarious that the business of government could not be carried on if he were required to exercise all his powers personally"280. The application of the principle depends on whether the "nature, scope and purpose of the function vested in the repository made it unlikely that Parliament intended that it was to be exercised by the repository personally because administrative necessity indicated that it was impractical for [the repository] to act otherwise than through [the repository's] officers or officers responsible to [the repository]"281. Section 351 unequivocally conveys Parliament's requirement that the power in s 351(1) not be exercisable by any person other than the Minister personally. Section 351 does not exclude that, if the Minister wishes to consider exercising the power in s 351(1), the Minister may obtain assistance and advice from officers of the department. The fact that a Minister's appreciation of a case to be considered may depend "to a great extent"282 on the analysis and advice of departmental officers does not mean that the Minister, in deciding a response to a request based on that analysis and advice, is not personally making the decision. A power such as that in s 351 has been characterised as involving two aspects: a procedural aspect enabling the Minister to consider exercising the power; and a substantive aspect enabling the Minister to exercise or not exercise the power283. Five points should be made now. First, this procedural and substantive distinction is necessary because s 351(7) refers to considering exercising the power in s 351(1) and, thereby, subdivides the power into the consideration of its exercise and its exercise. The distinction drawn in s 351(7) reflects that, depending on the terms of the statute, the statutory vesting of a power may carry with it an express or implied duty to 279 (1986) 162 CLR 24. 280 (1986) 162 CLR 24 at 38, citing O'Reilly v State Bank of Victoria Commissioners (1982) 153 CLR 1 at 11. 281 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 38. 282 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 65. 283 eg, Plaintiff M61 (2010) 243 CLR 319 at 350 [70]. Jagot consider the exercise of the power in certain circumstances284. In this case, any such potential duty is expressly excluded by s 351(7). Further, as s 351(7) provides that there is no duty to consider exercising the power, it must also follow that there is no duty to exercise the power285. Second, the Minister does not need to deal with any or all requests by separating the procedural and substantive aspects of the power. If the Minister chooses, the Minister can make a single decision (to exercise or not to exercise the power to substitute a more favourable decision) about a, or certain classes of, request, or all requests. Of course, as a practical matter, the extent to which the Minister can consider the public interest in the context of making (or refusing to make) a procedural decision about a particular request may be constrained by a lack of knowledge of the details of the request. The same lack of knowledge does not necessarily apply to Ministerial procedural decisions about certain classes of request or all requests in which the public interest might depend on common features of the class or common circumstances. In any event, whatever the level of detail available, the Minister's view as to the public interest conditions all decisions which s 351(1) empowers the Minister to make, be they positive or negative decisions. Third, while the power in s 351(1) involves two aspects (the procedural and the substantive), both aspects give rise to a positive and a negative decision-making potential. The procedural aspect, enabling the Minister to consider exercising the power, is capable of a positive decision ("I will consider exercising my power") or a negative decision ("I will not consider exercising my power"). The substantive aspect, enabling the Minister to exercise or not exercise the power, is also capable of a positive decision ("I will exercise my power") or a negative decision ("I will not exercise my power"). Accordingly, the fact that s 351(1) is expressed in terms of the positive decision only ("... the Minister may substitute ...") does not mean that a negative procedural or substantive decision is not a decision under s 351(1). Fourth, not all statutory or non-statutory powers are able to be disaggregated. Nor are all conceptual distinctions useful. As explained, given the terms of s 351(7), the procedural and substantive aspects of the power in s 351(1) 284 eg, Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 374-375 [102]-[103], referring to Commissioner of State Revenue (Vict) v Royal Insurance Australia Ltd (1994) 182 CLR 51 at 88 (applying Julius v Lord Bishop of Oxford (1880) 5 App Cas 214 at 222-223 and Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997 at 1033-1034) and Murphyores Incorporated Pty Ltd v The Commonwealth (1976) 136 CLR 1 at 17-18 (applying R v Anderson; Ex parte Ipec-Air Pty Ltd (1965) 113 CLR 177 at 189). 285 Plaintiff M61 (2010) 243 CLR 319 at 350 [70]. Jagot must be distinguished. But no further disaggregation of the power in s 351(1) of the Act is possible. However, once distinctions of this kind have been introduced, clarity of language in describing actions or non-actions is critical. The earlier authorities286, when viewed from the perspective of the issues in the present matters, must be read with this in mind. Fifth, and critically for the present appeals, the zone of exclusive Ministerial personal decision-making power created by s 351 of the Act applies to the whole power in s 351(1). It applies to the procedural aspect of that power (deciding in the public interest to consider or not to consider exercising the power) and to the substantive aspect of that power (deciding in the public interest to exercise the power or not to exercise the power). Plaintiff M61/2010E v The Commonwealth287, Plaintiff S10/2011 v Minister for Immigration and Citizenship288, and Minister for Immigration and Border Protection v SZSSJ289, on close analysis, do not support the Solicitor-General's position290. In Plaintiff M61, the Minister had made a positive procedural decision and the steps taken by departmental officers were directed towards the Minister deciding whether to make a positive substantive decision. As the claimants were in detention, the steps taken directly affected their liberty and were conditioned on the observance of procedural fairness291. In Plaintiff S10, the issue was whether the consideration of requests for a more favourable decision by the Minister by departmental officers under the 2009 version of the Minister's Instructions ("the Minister's Instructions 2009") – referred 286 eg, Plaintiff M61 (2010) 243 CLR 319 at 350-351 [70]-[71], 353 [77]; Plaintiff S10 (2012) 246 CLR 636 at 653 [46], 665 [91]; Minister for Immigration and Border Protection v SZSSJ (2016) 259 CLR 180 at 195 [33], 200 [54] ("SZSSJ"). 287 (2010) 243 CLR 319. 288 (2012) 246 CLR 636. 289 (2016) 259 CLR 180. 290 In Davis v Minister (2021) 288 FCR 23 at 62 [155], Mortimer J reached much the same conclusion, principally by reference to her Honour's succinct statement at 58 [136]: "Yet the power in s 351 is a power personal to the Minister." 291 Plaintiff M61 (2010) 243 CLR 319 at 353-354 [78]. Jagot to in Plaintiff S10 as "the guidelines" – was subject to a duty of procedural fairness. The answer given was that it was not292. In SZSSJ, the difference between cases in which the Minister has declined to consider the exercise of the substantive power and cases in which the Minister has not so declined was explained in these terms293: "[P]rocesses undertaken by the Department to assist in the Minister's consideration of the possible exercise of a non-compellable power derive their character from what the Minister personally has or has not done. If the Minister has made a personal procedural decision to consider whether to make a substantive decision, a process undertaken by the Department to assist the Minister's consideration has a statutory basis in that prior procedural decision of the Minister. Having that statutory basis, the process attracts an implied statutory requirement to afford procedural fairness where the process has the effect of prolonging immigration detention. If the Minister has not made a personal procedural decision to consider whether to make a substantive decision, a process undertaken by the Department on the Minister's instructions to assist the Minister to make the procedural decision has no statutory basis and does not attract a requirement to afford procedural fairness." In the passage from SZSSJ quoted above, the condition "[i]f the Minister has not made a personal procedural decision ...", in context, means that the Minister has not made a positive or a negative procedural decision. This is apparent from the subsequent statement about the department assisting the Minister to make the procedural decision, which, of necessity, must encompass both a positive and a negative procedural decision. In Plaintiff S10, one request had been referred to the Minister and the Minister had decided not to consider exercising the power, one repeat request was not referred to the Minister at all, and two other repeat requests were referred to the Minister, who decided to not "intervene"294. The foundation of the distinction between a personal Ministerial decision to not "intervene" and a negative procedural decision is not immediately apparent. But, as will be explained, the foundation of that distinction is not critical to the resolution of the present cases. In Plaintiff S10, it was concluded that the Minister's Instructions 2009 did no more than "facilitate the provision of advice to the Minister in particular cases 292 Plaintiff S10 (2012) 246 CLR 636 at 642 [4], 666 [96]. 293 (2016) 259 CLR 180 at 200 [54]. 294 (2012) 246 CLR 636 at 643 [7], [10], 645 [16], 645-646 [21], 664 [89]. Jagot and otherwise operate as a screening mechanism in relation to any requests which the Minister has decided are not to be brought to his or her attention"295 or represented "decisions by the Minister that if a case is assessed as not meeting the guidelines, the Minister does not wish to consider the exercise of the dispensing power, and if a case is assessed favourably then the Minister does wish to consider that exercise"296. These characterisations of the Minister's Instructions 2009 depended on both the arguments put in Plaintiff S10 and, to some extent, the substantive effect of the principal provisions of the Minister's Instructions 2009297. In Plaintiff S10, no argument was put that the implementation of the Minister's Instructions 2009 involved decisions of departmental officers within the zone of exclusive Ministerial personal decision-making power created by s 351 of the Act298. It follows that the statements in Plaintiff S10 about the Minister's Instructions 2009 are to be understood in the context of the issues for decision in that case. The same observation applies to SZSSJ. The statement in SZSSJ – that, if the Minister has not made a personal procedural decision to consider whether to make a substantive decision, a process undertaken by the department on the Minister's instructions to assist the Minister to make the procedural decision has no statutory basis299 – does not engage with the appellants' arguments in the present cases. Again, it was not suggested in SZSSJ that the issuing and implementation of the Minister's Instructions 2009 exceeded a limit on executive power imposed by It may be accepted that the Minister may issue instructions to the department that: (a) the Minister has made a negative procedural decision under s 351(1) of the Act that the Minister does not want to consider any requests to substitute a more favourable decision under s 351(1); or (b) the Minister has made a positive and/or negative procedural decision under s 351(1) of the Act that the Minister does or does not want to consider certain requests to substitute a more favourable decision under s 351(1)300; or (c) the Minister does not want to be put 295 (2012) 246 CLR 636 at 653 [46]. 296 (2012) 246 CLR 636 at 665 [91]. 297 As Mortimer J recognised in Davis v Minister (2021) 288 FCR 23 at 59-62 [141]- 298 This is apparent from Plaintiff S10 (2012) 246 CLR 636 at 641-642 [2], 651 [39]- 299 (2016) 259 CLR 180 at 200 [54]. 300 eg, Bedlington v Chong (1998) 87 FCR 75 at 80-81. Jagot in a position to make a procedural decision (negative or positive) about any or only certain requests under s 351(1) of the Act. These propositions follow from s 351(7), which excludes any duty on the part of the Minister to consider whether to exercise the power under s 351(1)301. What does not follow is that more confined instructions concerning only certain kinds of requests necessarily do not involve impermissible actions of departmental officers within the zone of exclusive Ministerial personal decision-making power created by s 351 of the Act. The question whether the instructions conform to the limit on both statutory and executive powers prescribed by s 351 was never posed in Plaintiff M61, Plaintiff S10, or SZSSJ. As a result, the statements in those cases on which the Solicitor-General relies302 do not answer the appellants' cases. This question is answered by determining whether, as a matter of substance and not form, the instruction or relevant part thereof purports to enable a departmental officer to decide a matter within the zone of exclusive Ministerial personal decision-making power created by s 351 of the Act. This constraint imposed by s 351 limits departmental officers in the exercise of both executive non-statutory power and statutory power. In the case of the request of each appellant in the present cases, the departmental officer finalised the request by implementing s 10.2 of the Minister's Instructions 2016 (concerning repeat requests). The officers decided that the requests would not be referred to the Minister and would be finalised by the department because, as provided for in s 10.2, the department was not satisfied that there had been a significant change in circumstances since the previous request which presented unique or exceptional circumstances as described in s 4 of the Minister's Instructions 2016. In applying s 4 of the Minister's Instructions 2016 to each request, the departmental officers were required to evaluate whether the circumstances on which each appellant relied involved, for example, "strong compassionate circumstances that if not recognised would result in serious, ongoing and irreversible harm and continuing hardship to an Australian citizen or an Australian family unit", or "compassionate circumstances regarding the age and/or health and/or psychological state of the person that if not recognised would result in serious, ongoing and irreversible harm and continuing hardship to the person", or 301 See footnote 284. 302 eg, Plaintiff M61 (2010) 243 CLR 319 at 350-351 [69]-[71]; Plaintiff S10 (2012) 246 CLR 636 at 653 [46]-[47], 665 [91]; SZSSJ (2016) 259 CLR 180 at 197-200 Jagot "circumstances not anticipated by relevant legislation; or clearly unintended consequences of legislation; or [where] the application of relevant legislation leads to unfair or unreasonable results in a particular case". In performing this evaluative task and deciding to finalise the request without referral to the Minister, the departmental officers both decided that the Minister should not make a procedural decision about the request and, in substance, made a negative procedural decision about the request. In so doing, the departmental officers acted beyond the executive power, which was confined by s 351 of the Act. This conclusion is not gainsaid by the fact that the Minister's Instructions 2016 say that what is and what is not in the public interest is for the Minister to determine303 and that the Minister may intervene whether the case is brought to the Minister's attention or not304. The Minister's Instructions 2016, by the operation of s 4 of that document, required the departmental officers to decide matters within the zone of exclusive Ministerial personal decision-making power created by s 351 of the Act. That was impermissible. As noted, the Minister's Instructions 2009 were considered in Plaintiff S10, but no argument was put in that case that the substance of those Instructions exceeded the limits of executive power. Accordingly, Plaintiff S10 is not authority to the contrary of the appellants' arguments in the present cases. There is also at least one key difference between the Minister's Instructions 2009 and the Minister's Instructions 2016. It is that s 16 of the Minister's Instructions 2009 provided that, for initial requests that the departmental officers considered did not involve unique or exceptional circumstances, the Minister instructed that the department was to "bring the case to my attention through a short summary of the issues in schedule format, so that I may indicate whether I wish to consider the exercise of my power". This is an important difference from s 10.1 of the Minister's Instructions 2016 because it means that, under the Minister's Instructions 2009, the department's consideration or evaluation, as a matter of substance, could not be said to involve any aspect of the Minister's personal power in s 351(1). The department's consideration or evaluation under s 16 of the Minister's Instructions 2009 was necessarily in the nature of advice, analysis, and assistance to the Minister to enable the Minister to decide whether to make a procedural (and substantive) decision or not305. 303 Minister's Instructions 2016, s 2. 304 Minister's Instructions 2016, s 12. 305 As concluded in Plaintiff S10 (2012) 246 CLR 636 at 653 [46]-[47], 665 [91]. Jagot If s 17 of the Minister's Instructions 2009 (concerning repeat requests) had been the subject of the arguments put in the present cases (which it was not), several further issues would have required analysis. The fact that there is no such analysis in Plaintiff S10 reinforces that the Court was not dealing with the issues to which the present cases give rise. It would have been relevant that, in contrast to the Minister's Instructions 2016, s 17 of the Minister's Instructions 2009 characterises a "repeat request" as one that has previously been considered by a Minister. The Minister's Instructions 2016 characterise a "repeat request" as one that a Minister had "previously received" (which, in the context of the Minister's Instructions 2016, would be taken to mean received but not considered as permitted by s 10.1). Further, the Minister's Instructions 2009 instructed the departmental officers to decide if they were satisfied there had been a significant change in circumstances which raised new, substantive issues and which, in the opinion of the departmental officers, fell "within the ambit of" the public interest provisions of the Minister's Instructions 2009. It is not that these differences are necessarily sufficiently material to distinguish the substantive operation of the Minister's Instructions 2009 from the Minister's Instructions 2016 in respect of repeat requests. It is that the absence of analysis of the substantive operation of s 17 of the Minister's Instructions 2009 in Plaintiff S10 confirms that no argument was put in that case that the Instructions exceeded the executive power of the Minister (to issue) and/or the departmental officers (to implement) given the terms of s 351 (and the equivalent Ministerial personal and non-compellable power in the public interest provisions in ss 48B, 195A, and 417 of the Act). For these reasons, the orders and declarations proposed by Kiefel CJ, Gageler and Gleeson JJ should be made.
HIGH COURT OF AUSTRALIA GYPSY JOKERS MOTORCYCLE CLUB INCORPORATED APPELLANT AND THE COMMISSIONER OF POLICE RESPONDENT Gypsy Jokers Motorcycle Club Incorporated v Commissioner of Police [2008] HCA 4 7 February 2008 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Western Australia Representation D Grace QC with M K Moshinsky and A M Dinelli for the appellant (instructed by Williams Ellison Barristers & Solicitors) D F Jackson QC with R M Mitchell for the respondent (instructed by State Solicitor for Western Australia) D M J Bennett QC, Solicitor-General of the Commonwealth with S P Donaghue intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales with J G Renwick intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor (NSW)) C J Kourakis QC, Solicitor-General for the State of South Australia with M J Wait and J P McIntyre intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor for South Australia) P M Tate SC, Solicitor-General for the State of Victoria with J M Davidson and J A Redwood intervening on behalf of the Attorney-General for the State of Victoria (instructed by Victorian Government Solicitor) W Sofronoff QC, Solicitor-General of the State of Queensland with P Davis SC and D D Keane intervening on behalf of the Attorney-General of the State of Queensland (instructed by Crown Solicitor for Queensland) M P Grant QC, Solicitor-General for the Northern Territory with S L Brownhill intervening on behalf of the Attorney-General for the Northern Territory (instructed by Solicitor for the Northern Territory) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Gypsy Jokers Motorcycle Club Incorporated v Commissioner of Police Statutes – Interpretation – Corruption and Crime Commission Act 2003 (WA) – The appellant sought review of a decision of the Commissioner of Police to issue a fortification removal notice in the Supreme Court of Western Australia – Section 76(2) of the Act provided that the Commissioner could identify any information provided to the Supreme Court for the purposes of review proceedings as confidential "if its disclosure might prejudice the operations of the Commissioner" with consequences for the use and disclosure of the information – Whether s 76(2) renders unexaminable by the Supreme Court the decision of the Commissioner – Relevance of the Constitution to statutory construction. Constitutional law (Cth) – Chapter III – Judicial power – Integrity of State Supreme Courts – Whether s 76(2) impairs the Supreme Court's character as independent and impartial or otherwise improperly controls the exercise of its jurisdiction contrary to Ch III of the Constitution – Effect of restriction on ability to ensure equality between litigants – Effect of restriction on publication of information in reasons for judgment – Effect of restriction on ability of party to bring appeal proceedings – Role of Executive officers in relation to the judicial process. Words and phrases – "confidential", "fortification removal notice", "publicly disclosed", "review". Constitution, Ch III. Corruption and Crime Commission Act 2003 (WA), s 76(2). GLEESON CJ. The issues, the facts and the legislation appear from the reasons for judgment of Crennan J. I agree that the appeal should be dismissed for the reasons given by Crennan J, and would make the following additional comments. In question was the possible invalidity of s 76 of the Corruption and Crime Commission Act 2003 (WA) ("the CCC Act"), or at least s 76(2). The appellant contended that s 76(2) was invalid, but that the remainder of the section was valid. The respondent argued that s 76 was wholly valid but, if that were not so, then it was wholly invalid: in brief, that, if s 76(2) were invalid, it was inseverable. The legislation of which s 76 is a part, in its broadest outline, is of a kind which authorises the executive government to order the making of alterations to, or the carrying out of work on, buildings. As was pointed out in argument, such orders are commonly made for a variety of reasons, including health, sanitation, considerations of local amenity, or lack of permission under laws relating to planning and development. When made, the orders affect property rights. The orders with which the relevant provisions of the CCC Act are concerned have a narrower focus. They affect a certain kind of property right, involving the erection and maintenance of heavy fortifications on premises. Where the premises are suspected of being used by people involved in organised crime, there is a power to order removal of the fortifications. Such removal facilitates access to the premises (for example, pursuant to search warrants) by law enforcement agencies. The relevant provisions of the CCC Act were enacted to replace earlier legislation entitled the Criminal Investigation (Exceptional Powers) and Fortification Removal Act 2002 (WA). Section 76 provides for a limited form of judicial review of fortification removal notices issued by the Commissioner of Police under s 72(2) of the CCC Act. Such a notice requires a reasonable belief by the Commissioner of Police that the subject premises are heavily fortified and are habitually used as a place of resort by people reasonably suspected to be involved in organised crime. Under s 76(1), the question for the Supreme Court, upon review, is whether the Commissioner of Police could reasonably have had that belief. It is only necessary to state the context and the issue to see that it is likely that judicial review proceedings under s 76 may give rise to problems of confidential information, including information that would reveal the identity of police informers or compromise current police investigations. Parliament sought to address those problems in s 76(2). It is, however, important to consider the alternative, especially since it is said that s 76 could operate without s 76(2). An alternative would have been to make no specific provision about confidentiality, but to leave the general law to apply. Claims for public interest immunity against disclosure of information of the kind just mentioned are well known1. The consequence of success of such a claim is that information which is subject to the immunity is not available as evidence to be taken into account in deciding the outcome of the proceedings. In view of the nature of the proceedings for which s 76(1) provides, and the issue in those proceedings, there would almost certainly be cases in which a successful claim for public interest immunity by the Commissioner of Police would have the practical consequence of making it impossible for the Court to exercise the review function contemplated by s 76(1). The Court would not be able to have regard to some, or perhaps any, of the information on which the Commissioner's belief was based. In that event, the application for review may be bound to fail. Without s 76(2), not only would s 76 have a substantially different practical operation; there would be plainly foreseeable circumstances in which it would have no practical operation at all. A provision such as s 7 of the Interpretation Act 1984 (WA) cannot be applied to produce a consequence so radically different from that which Parliament has enacted2. Quite apart from the question of severability, this consideration of how s 76 would work without s 76(2) assists to place in proper perspective the appellant's arguments based on Kable v Director of Public Prosecutions3. Another consideration essential to an evaluation of that argument is the true construction of s 76(2). Wheeler JA, who dissented in the Western Australian Court of Appeal, recorded that there was little argument addressed to that Court about the proper construction of s 76 in its statutory context. In this Court, senior counsel for the respondent's first argument was that Wheeler JA had based her decision upon an erroneous interpretation of s 76(2). Wheeler JA held it to be fatal to the validity of s 76(2) that, in a context of determining (under s 76(1)) the validity of executive action, the Court was required by s 76(2) to accept a decision, dictated to it by the Commissioner of Police, as to the confidentiality of information, without exercising its own judgment about the matter of confidentiality. Senior counsel for the respondent Commissioner submitted that this view of s 76(2) is incorrect, and the error of construction undermines the basis of Wheeler JA's reasoning. The submission should be accepted. For the reasons explained by Crennan J, and by Gummow, Hayne, Heydon and Kiefel JJ, s 76(2) does not empower the Commissioner of Police to dictate anything. It enables the Commissioner of Police to identify information and make a claim for confidentiality, advancing reasons (if the 1 See, for example, Sankey v Whitlam (1978) 142 CLR 1 at 61-62; Attorney-General (NSW) v Stuart (1994) 34 NSWLR 667 at 674-675. 2 Pidoto v Victoria (1943) 68 CLR 87 at 107-111. (1996) 189 CLR 51. conclusion is not self-evident) as to why its disclosure might prejudice the operations of the Commissioner. It is for the Court to decide whether the claim for confidentiality should be upheld, that is, whether the condition upon which s 76(2) operates (that disclosure might prejudice the operations of the Commissioner) has been made out. That is the construction of s 76(2) advanced on behalf of the Commissioner of Police in this Court. It appears from what Wheeler JA said that it was not a question that was the subject of much, or any, argument in the Court of Appeal, but it is not suggested that the point is not now open for debate. The ground on which Wheeler JA decided the case in favour of the appellant makes the point very important. Senior Counsel for the Commissioner submitted that "if the Court determined that disclosure of the information identified as confidential could not prejudice the Commissioner's operations, then that information would be information in relation to which there would not be an efficacious identification" for the purposes of s 76(2). Once that construction of s 76(2) is accepted, as it seems to me it should be accepted, then the principal foundation for the appellant's argument on validity disappears. GUMMOW, HAYNE, HEYDON AND KIEFEL JJ. This appeal from the Court of Appeal of the Supreme Court of Western Australia (Martin CJ and Steytler P; Wheeler JA dissenting)4 concerns the validity of legislation of that State which confers jurisdiction upon the Supreme Court in a new species of judicial review of administrative action. There has been no adjudication of the underlying review proceedings in the course of which constitutional issues have arisen. This Court is concerned with those issues and not with any other questions which are yet undetermined in the Supreme Court. The Supreme Court is identified in Ch III of the Constitution both as "the Supreme Court of any State" in s 73(ii) and as "any court of a State" in s 77(iii). In the instant proceeding in the Supreme Court, the objection to legislative validity having been taken by the present appellant, the Supreme Court became seised of a matter arising under the Constitution or involving its interpretation (Constitution ss 76(i), 77(iii), Judiciary Act 1903 (Cth) s 39(2)). However, the disputed constitutional issues concern the efficacy of the exercise by the Supreme Court not of federal jurisdiction, but of jurisdiction provided by State statute law. That efficacy is challenged for reasons based in Ch III of the Constitution, but the jurisdiction in question is State jurisdiction. In their joint judgment in North Australian Aboriginal Legal Aid Service Inc v Bradley5, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ expressed acceptance of the proposition: "it is implicit in the terms of Ch III of the Constitution, and necessary for the preservation of that structure, that a court capable of exercising the judicial power of the Commonwealth be and appear to be an independent and impartial tribunal". Their Honours went on6 to remark upon the impossibility of making an exhaustive statement of the minimum characteristics of such an independent and impartial tribunal. But it may be said that the conditions which must exist for courts in this country to administer justice according to law are inconsistent with some forms of external control of those courts appropriate to the exercise of authority by public officials and administrators. The appellant contends that the 4 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2007) 33 WAR 245. (2004) 218 CLR 146 at 163 [29]. (2004) 218 CLR 146 at 163 [30]. See also the remarks of Gleeson CJ at 152-153 legislation under challenge does purport to exercise an impermissible form of control over the exercise by the Supreme Court of its jurisdiction. The first step in the making of that assessment of the validity of any given law is one of statutory construction. So far as different constructions appear to be available, a construction is to be selected which would avoid rather than lead to a conclusion of constitutional invalidity7. Further, where, as in this case, no facts are in dispute, it is not only competent but may be expedient in the interests of justice for this Court to entertain an argument as to statutory construction even if it was not previously fully developed in that form8. When the task of statutory construction is performed in the present case it becomes apparent that the majority of the Court of Appeal reached the correct result in dismissing the challenge to validity. The legislation Part 4 of the Corruption and Crime Commission Act 2003 (WA) ("the Act") is headed "Organised crime: exceptional powers and fortification removal". Division 6 (ss 67-80) of Pt 4 is headed "Fortifications". The expression "fortification" is so defined as to mean any structure or device that is designed to prevent or impede uninvited entry to premises or to provide any other form of countermeasure against such uninvited entry; the structure or device may stand alone or be part of a system (s 67(1)). Premises are "heavily fortified" if there are fortifications to an extent or of a nature reasonably regarded as excessive for premises of the kind in question (s 67(2)). An important part in the scheme provided by Div 6 is played by the Corruption and Crime Commission ("the Commission"), a body established by Pt 2 of the Act. Section 68 of the Act states: The Commissioner of Police may, without giving notice to any other person, apply to the Commission for the issue of a fortification warning notice. 7 New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 8 See Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438. The Commission may issue a fortification warning notice if satisfied on the balance of probabilities that there are reasonable grounds for suspecting that the premises to which it relates are – heavily fortified; and habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime. The Commission may be satisfied by a statement made by a police officer and verified by statutory declaration." The expression "organised crime" is defined in s 3 so as to identify the activities of two or more persons who are associated together solely or partly for purposes in the pursuit of which two or more of a certain species of offence are committed and the commission of each offence involves substantial planning and organisation. The offences are those listed in Sched 1. This lists a range of offences under the statute law of the State, in particular under the Criminal Code (WA), the Criminal Property Confiscation Act 2000 (WA), the Firearms Act 1973 (WA) and the Misuse of Drugs Act 1981 (WA). A main purpose of the Act is stated in s 7A as being "to combat and reduce the incidence of organised crime". A "fortification warning notice" is addressed by the Commission to the owner of the premises and other "interested persons", including any lessee and others in actual occupation (s 69(1)). The notice must include, among other information, a warning that "a fortification removal notice" may be issued unless within a period of 14 days after the giving of the notice ("the submission period"), the Commissioner of Police is satisfied of two matters which are expressed in the alternative and in the negative (s 69(2)(b)). The matters are: the premises are not heavily fortified; or the premises are not habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime". The power of the Commissioner of Police to issue a fortification removal notice (s 72(1)) is constrained, in particular, by s 72(2). This has an affinity to s 69(2)(b), set out above, but is cast in affirmative terms and states: "The Commissioner of Police cannot issue the fortification removal notice unless, after considering each submission, if any, made before the submission period elapsed, the Commissioner of Police reasonably believes that the premises are – heavily fortified; and habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime." (emphasis added) In default of compliance with a fortification removal notice, the Commissioner of Police may cause the fortifications to be removed or modified to the extent required by the notice (s 75(1)). Section 77 renders it a crime for a person to do anything intending to prevent, obstruct, or delay, the removal or modification of fortifications in accordance with a fortification removal notice. Sections 79 and 80 respectively provide that no claim for compensation arises by reason of the exercise of powers under Div 6 and no action lies in tort against a person for damage to property at the premises caused by the performance in good faith of a function under Div 6. The Supreme Court The Supreme Court is drawn into this statutory scheme by the provisions of s 76. The appellant contends, in particular, that the Court of Appeal should have declared that s 76(2) is invalid. If the appellant were to succeed in that submission questions then would arise of the possible severance of s 76(2). The appellant commenced in 2004 a proceeding in the Supreme Court seeking review under s 76 of the decision of the respondent, the Commissioner of Police, to issue a fortification removal notice dated 5 May 2004 in respect of premises at 10 Lower Park Road, Maddington. There has been no adjudication of that review. Rather, on 1 May 2006, Blaxell J, acting under s 43 of the Supreme Court Act 1935 (WA) ("the Supreme Court Act") reserved for consideration of the Court of Appeal the question of the validity of s 76(2). An originating summons dated 3 October 2006, seeking declaratory relief to the same effect, was also referred to the Court of Appeal. The Court of Appeal answered the question reserved adversely to the appellant and dismissed the application for declaratory relief. It is convenient now to turn to sub-ss (1), (5), (6) and (7) of s 76. These exemplify legislation which both creates fresh rights and liabilities and confers jurisdiction to provide remedies9. Further, subject to contrary provision, this conferral of jurisdiction is to be understood as bringing with it the usual incidents of the exercise of jurisdiction by the Supreme Court10. One such contrary provision is s 76(7). The sub-section renders the decision of the Supreme Court "final", and thereby attracts s 60(1)(c) of the Supreme Court Act. This stipulates that no appeal shall lie to the Court of Appeal from a decision which any statute of Western Australia states to be final11. It also should be noted that by operation of s 83 of the Act the "review" for which s 76 provides is to the exclusion of what otherwise would be the general jurisdiction of the Supreme Court12 to issue the prerogative writs, grant injunctions and make declarations with respect to the performance of a function under Pt 413. Something more should be said here respecting what would be involved in the exercise of that general jurisdiction of the Supreme Court in a case such as the present and the absence of the exclusion of the jurisdiction by s 83 of the Act. 9 See James Hardie & Coy Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53 at 64-65 10 Electric Light and Power Supply Corporation Ltd v Electricity Commission of NSW (1956) 94 CLR 554 at 560; Mansfield v Director of Public Prosecutions (WA) (2006) 226 CLR 486 at 491 [7]. 11 However, a provision to this effect in State legislation is ineffective to curtail the jurisdiction of this Court conferred by s 73(ii) of the Constitution: BHP Billiton Ltd v Schultz (2004) 221 CLR 400 at 433 [55], 453 [127]. 12 See s 16 of the Supreme Court Act. 13 This exclusion of judicial review by the Supreme Court is qualified by the opening words of s 83(1) of the Act, "Except with the consent of the Parliamentary Inspector [of the Commission]"; the giving of that consent is a function conferred on the Inspector by s 195(1)(f). The Inspector is an officer of the Parliament of the State (s 188(4)). In such a proceeding for judicial review of a decision of the Commissioner of Police to issue a fortification removal notice, an attempt by an applicant to gain access by discovery or on subpoena to material relied upon by the Commissioner, and thereby support a case of reviewable error by the Commissioner, could be expected, as to at least some of that material, to be met by a claim of public interest immunity14. For the purpose of ruling on such a claim the Supreme Court might inspect for itself, and without disclosure to the applicant, the materials in question15. A successful claim to such immunity (preferably by decision of a judicial officer other than the trial judge) would have the consequence that the material was not admitted into evidence and would be denied both to the Court and the applicant. The handicap to which an applicant (and the Court) thereby are subjected appears from the following observations by Mason J in Church of Scientology Inc v Woodward16, which were made when dealing with matters of national security: "Intelligence is relevant to security if it can reasonably be considered to have a real connexion with that topic, judged in the light of what is known to ASIO at the relevant time. This is a test which the courts are quite capable of applying. It is a test which presents a formidable hurdle to a plaintiff and not only because a successful claim for Crown privilege may exclude from consideration the very material on which the plaintiff hopes to base his argument – that there is no real connexion between the intelligence sought and the topic. The fact that a successful claim for privilege handicaps one of the parties to litigation is not a reason for saying that the Court cannot or will not exercise its ordinary jurisdiction; it merely means that the Court will arrive at a decision on something less than the entirety of the relevant materials." The construction of s 76 It is against this background that s 76 is to be construed. The scheme of s 76 is to displace what otherwise might have been a claim to public interest immunity by the Commissioner of Police. Section 76 does so by providing that 14 See Sankey v Whitlam (1978) 142 CLR 1 at 61-62, as to the protection of police informers by the privilege. 15 Sankey v Whitlam (1978) 142 CLR 1 at 46, 110. 16 (1982) 154 CLR 25 at 61. See also the remarks of Brennan J at 75-77. information supplied by the Commissioner to the Supreme Court is subject to limitations upon use and disclosure of that information where the Supreme Court is satisfied disclosure might prejudice the operations of the Commissioner. Section 76(1) states: "If a fortification removal notice relating to premises has been issued, the owner or an interested person may, within 7 days after the day on which the notice is given to the owner of the premises, apply to the Supreme Court for a review of whether, having regard to the submissions, if any, made before the submission period elapsed and any other information that the Commissioner of Police took into consideration, the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice." Sub-sections (5) and (6) of s 76 provide: "(5) The court may decide whether or not the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice. If the court decides that the Commissioner of Police could not have reasonably had the belief required by section 72(2) when issuing the notice, the notice ceases to have effect." The nature of the jurisdiction conferred upon the Supreme Court is identified in s 76(1) as a "review". This requires the Supreme Court to decide whether the Commissioner of Police, when issuing the fortification removal notice, "could have reasonably had" a certain belief. The "belief" is that required by s 72(2), as to the premises being "heavily fortified" and "habitually used" as a place of resort by certain persons being "members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime". If the Supreme Court decides that the Commissioner of Police could not have reasonably had the requisite belief, then the fortification review notice "ceases to have effect" (s 76(6)). The determination, in an action for judicial review, of whether a statutory or other office holder could reasonably have had a belief of a particular description is readily recognised as the performance of a judicial function. Upon that review the Supreme Court is to be satisfied that facts exist which are sufficient to have induced that belief in a reasonable person17. With respect to s 76(1) of the Act, the belief in issue is that of the Commissioner of Police stipulated by s 72(2) and its reasonableness is to be determined by the Supreme Court upon regard of any submissions and any other "information" which the Commissioner of Police took into consideration. It is that material which provides the record upon which this particular species of judicial review is determined by the Supreme Court. Section 76(1) proceeds upon the footing that the Supreme Court will have before it the information which the Commissioner took into consideration when issuing the notice. The Commissioner of Police, in argument in this Court, accepted (and correctly so) that it is implicit in s 76(1) that information which was available to the Commissioner only in non-written form would have to be reduced to writing for the purposes of the review by the Supreme Court. Section 76(2) It is with the foregoing in mind, that attention is to be given to the text of s 76(2). This states: "The Commissioner of Police may identify any information provided to the court for the purposes of the review as confidential if its disclosure might prejudice the operations of the Commissioner of Police, and information so identified is for the court's use only and is not to be disclosed to any other person, whether or not a party to the proceedings, or publicly disclosed in any way." Counsel for the respondent put at the forefront of his oral submissions to this Court the proposition that s 76(2) does not render unexaminable by the Supreme Court the decision of the Commissioner of Police. That submission should be accepted and the contrary submission by the appellant rejected. It will be apparent that the text of the sub-section falls into two parts, the second commencing with the words "and information ...". The first part of the sub-section identifies the circumstances in which the information in question may be identified as confidential; the second part is controlled by the first and deals with the consequences of that identification for the conduct of the review by the Supreme Court. 17 George v Rockett (1990) 170 CLR 104 at 112-113. Any exercise by the Commissioner of Police of the power conferred by s 76(2) is conditioned upon the requirement introduced by the phrase "if its disclosure might prejudice the operations of the Commissioner of Police". The power is not conditioned upon the existence of the opinion of the Commissioner to that effect. Rather, the condition operates in circumstances where information is provided by the Commissioner to the Supreme Court and it is for the Supreme Court to determine upon evidence provided to it whether the disclosure of the information might have the prejudicial effect spoken of in the sub-section. (It may be added that even if the power were expressly conditioned upon the existence of the opinion of the Commissioner, this would be treated as requiring an opinion formed reasonably upon the material before the Commissioner18.) The dissenting judgment of Wheeler JA in the Court of Appeal largely was premised upon a construction of s 76 which gave to the Commissioner the power to determine "unilaterally" that materials were not to be disclosed, with the result that the Supreme Court was constrained by the Commissioner of Police, an officer of the Executive Branch of government, in the independent performance of its review function under s 7619. However, for the reasons given above, that premise should not be accepted and as a result the stated consequence of Executive Branch constraint does not follow. What then of the second part of s 76(2)? This states that the information is for "the use" only of the Supreme Court. However, that "use" entails all that is necessary or appropriate for the exercise by the Supreme Court of its jurisdiction to conduct the "review" identified in s 76(1)20. The sub-section continues in terms cast in the passive voice, a legislative drafting practice as undesirable as it is frequent. The information is not to be disclosed to any other person (including a party to the proceedings) and is not to be publicly disclosed in any way. But, one asks, disclosed by whom and under what sanction? The Act specifies no sanction or offence under the criminal law, and none was pointed to in submissions. The preferable construction of the words "and is not to be disclosed to any other person, whether or not a party to the 18 The relevant authorities in this Court are collected in Enfield City Corporation v Development Assessment Commission (2000) 199 CLR 135 at 150 [34]. 19 (2007) 33 WAR 245 at 286. 20 See the reasons of Brennan CJ in Nicholas v The Queen (1998) 193 CLR 173 at proceedings" is that they deny what otherwise would be any standing or entitlement of parties and non-parties under the usual processes of the Supreme Court in civil litigation to obtain any order or relief whether by way of discovery, subpoena or otherwise, which would entail disclosure of the information. However, two points should be made here. The first is that the operation of this legislative regime has an outcome comparable with that of the common law respecting public interest immunity, but with the difference that the Court itself may make use of the information in question. The second is related to the first, and is that the operation of this provision, like the balance of s 76(2), is conditioned upon the Supreme Court first having determined that disclosure of the information, identified by the Commissioner from that provided to the Court, might prejudice the operations of the Commissioner. Accordingly, there is here no legislative mandate for dictation to the Supreme Court by the Commissioner of the performance of its review function. There remains the phrase "[nor] publicly disclosed in any way". This may be addressed generally to any party to the proceedings and any other third person, but without any sanction beyond, perhaps, the contempt power of the Supreme Court in an appropriate case. However, the critical complaint by the appellant is that the requirement that there be no public disclosure also is directed to the Supreme Court and to the contents of any reasons for judgment it delivers upon a review application. A possible construction of the phrase in question in any application it has to the Supreme Court is that it operates as a condition upon the grant of jurisdiction to conduct the "review". But that construction should only be accepted in a case (unlike s 76(2)) where the legislative will is clearly expressed, particularly so where the court is a State Supreme Court21. As a general proposition, it may be accepted that legislation which purported to direct the courts as to the manner and outcome of the exercise of their jurisdiction would be apt impermissibly to impair the character of the courts as independent and impartial tribunals22. However, as indicated by the result in Nicholas v The Queen23, upholding the validity of s 15X of the Crimes Act 1914 21 See Berowra Holdings Pty Ltd v Gordon (2006) 225 CLR 364 at 375 [31]. 22 cf Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 36-37; Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651 at 669-670 [47]-[48]. 23 (1998) 193 CLR 173. (Cth), there is no impermissible interference with the exercise of judicial power even by such a significant evidentiary provision displacing the common law formulated in Ridgeway v The Queen24. If read as addressed to the Supreme Court, the words "[nor] publicly disclosed in any way" must also be read against the practice which from time to time sees the courts restrict the publication of portions of reasons for judgment and to formulate the balance of the reasons to accommodate the restriction. In argument on this appeal much was made by the respondent, and the Attorneys- General who intervened in support, of what might be done in that respect where issues of national security were involved. Perhaps a more mundane example is the treatment of formulae and the like in trade secrets litigation. Remarks of Deane J in Australian Broadcasting Commission v Parish25 are relevant here. His Honour said: legitimate claims results of an undue discounting of "The confidentiality are likely to be both the deterrence of the subject from having recourse to courts of justice for the vindication of legal rights or the enforcement of criminal law and the discouragement of willing co- operation on the part of witnesses whose evidence is necessary to enable the ascertainment of truth. The interests of the administration of justice plainly make it desirable that obligations of confidence be not lightly overruled and that legitimate expectations of confidentiality as to private and confidential transactions and affairs be not lightly disregarded." He added26: "In some cases, where publicity would destroy the subject matter of the litigation, the avoidance of prejudice to the administration of justice may make it imperative that the ordinary prima facie rule of open justice in the courtroom gives way to the overriding need for confidentiality." The words in s 76(2), "[nor] publicly disclosed in any way" must be read with the whole of what precedes them in that sub-section. The subject matter is information the disclosure of which the Supreme Court considers might prejudice 24 (1995) 184 CLR 19. 25 (1980) 29 ALR 228 at 255. 26 (1980) 29 ALR 228 at 255. the operations of the Commissioner of Police. One of the ways in which that prejudice might be sustained could be from publication in the reasons for judgment of the Supreme Court. The form taken by reasons of the Court which might subsequently be given when completing the "review" for which s 76 provides, is a matter for consideration at an earlier stage. That stage arises when the Court first considers, as to the information identified by the Commissioner, whether "its disclosure might prejudice the operations of the Commissioner of Police". In their application to the Supreme Court itself, the words "[nor] publicly disclosed in any way" should not be read as an attempted legislative direction as to the manner of the outcome of any review application made under s 76. The words are no more than an attempt at exhortation and an effort to focus attention by the Court to the prejudicial effect disclosure may have. That is, however, something the Supreme Court necessarily will have in mind throughout, given the framework provided by s 76(2). Orders The appeal should be dismissed with costs. Kirby KIRBY J. The function of this Court in constitutional adjudication is "to give the proper meaning to … public values"27. Such values are derived from the constitutional text, read in the light of past authority, legal history and considerations of legal principle and policy. Inevitably, a judge tests each case by reference to its possible implications for foreseeable future controversies and in the context of the overall operation of the system of government provided by the Constitution. That is why, in Roach v Electoral Commissioner28, the majority scrutinised a federal law enlarging the disqualification of prisoners from voting against a number of postulates. Were the Parliament's powers of disenfranchisement unqualified? Could disenfranchisement of Roman Catholics, for example, be restored29? Or of women30? Negative answers to these questions demonstrated that the issue before the Court demanded the drawing of a constitutional line, identified by reference to the text, historical considerations and the basic principles and purposes of representative democracy to which the Constitution gives expression. Or of Aboriginals31? Important principles of the Constitution are also found in Ch III. That Chapter contains unique arrangements for an integrated national Judicature, including State Supreme Courts, federal and other courts. All such courts must enjoy institutional integrity and impartiality. This follows both from the appellate arrangements of the Constitution32 and from the capacity of federal legislation to invest courts with federal jurisdiction33. 27 Fiss, "The Supreme Court 1978 Term – Foreword: The Forms of Justice", (1979) 93 Harvard Law Review 1 at 30 cited Marshall, "The Separation of Powers, An American Perspective", (2006) 22 South African Journal on Human Rights 10 at 28 (2007) 81 ALJR 1830; 239 ALR 1. 29 (2007) 81 ALJR 1830 at 1834 [8]; 239 ALR 1 at 5. See Roman Catholic Relief Act 1829 (UK); Roman Catholic Relief Act 1926 (UK). 30 (2007) 81 ALJR 1830 at 1833 [5]; 239 ALR 1 at 4. 31 (2007) 81 ALJR 1830 at 1833 [5]; 239 ALR 1 at 4. 32 Constitution, s 73. See also s 74. 33 Constitution, ss 71 and 77(iii). See Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51. Kirby This appeal, which arises from a divided decision of the Court of Appeal of the Supreme Court of Western Australia34, presents this Court with a question as to the validity of s 76(2) of the Corruption and Crime Commission Act 2003 (WA) ("the Act"). In order to answer the question of validity, it is necessary first to determine the meaning of the contested sub-section. If the provision is demonstrated to be invalid, a consequential question arises as to whether it can be severed from the Act. In deciding these questions, this Court is called upon, once again, to consider the ambit of the constitutional principle which it established in Kable v Director of Public Prosecutions (NSW)35. That principle36: "forbids attempts of State Parliaments to impose on courts, notably Supreme Courts, functions that would oblige them to act in relation to a person 'in a manner which is inconsistent with traditional judicial process'37. It prevents attempts to impose on such courts 'proceedings [not] otherwise known to the law', that is, those not partaking 'of the nature of legal proceedings'38. It proscribes parliamentary endeavours to 'compromise the institutional impartiality' of a State Supreme Court39. It forbids the conferral upon State courts of functions 'repugnant to judicial process'40." Experience teaches that governments and parliaments in Australia occasionally attempt "to spend the reputational currency of the independent courts in the pursuit of objectives which legislators deem to be popular"41. They sometimes seek to cloak their decisions "in the neutral colors of judicial 34 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2007) 33 WAR 245. 35 (1996) 189 CLR 51. 36 Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 628 [141]. 37 Kable (1996) 189 CLR 51 at 98 per Toohey J. See also Grollo v Palmer (1995) 184 CLR 348 at 363-365; Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 8-9, 13-14, 20-22. 38 Kable (1996) 189 CLR 51 at 106 per Gaudron J. 39 Kable (1996) 189 CLR 51 at 121 per McHugh J. 40 Kable (1996) 189 CLR 51 at 134 per Gummow J. 41 Fardon (2004) 223 CLR 575 at 628 [142]. Kirby action"42. Novel arrangements are then introduced into the law that impinge on the "judicial process". When challenged, such arrangements should be the subject of strict scrutiny. In the present appeal, an unusual (if not unique) State law appears to impinge on the performance by the Supreme Court of Western Australia ("the Supreme Court") of its ordinary functions in the ordinary way. I consider that the sub-section involves an impermissible legislative direction to the Supreme Court43. Effectively, it imposes the decision of an officer of the Executive Government upon the Supreme Court. That officer, in law or in substance, thereby controls the discharge of the judicial process, the effective participation of the Supreme Court in that process and the capacity of the Supreme Court to explain the reasons for its decision to the parties and the public. The judge may appear in robes to pronounce what shall be done. But the hand that directs the process is elsewhere, outside the courtroom, and actually belongs to the respondent party. The Kable principle was at first regarded as "far-reaching"44. Yet if this is so, it has certainly been "under-performing"45. The circumstances of this case are in some ways special and peculiar. However, the endorsement by the majority of the challenged legislation is a matter of concern. Section 76(2) of the Act represents a disturbing precedent. To prevent the endorsement and possible future extension of the precedent, the appeal should be allowed. The conclusion favoured by the dissenting judge in the Court of Appeal was correct. It should now be adopted by this Court. 42 Mistretta v United States 488 US 361 at 407 (1989); cf Fardon (2004) 223 CLR 43 cf Silbert v Director of Public Prosecutions (WA) (2004) 217 CLR 181 at 190 [25]. 44 Baker v The Queen (2004) 223 CLR 513 at 544 [83] citing eg Campbell, "Constitutional Protection of State Courts and Judges", (1997) 23 Monash University Law Review 397 at 408; Miller, "Criminal Cases in the High Court of Australia", (1997) 21 Criminal Law Journal 92 at 100. 45 Wheeler, "The Kable Doctrine and State Legislative Power Over State Courts", (2005) 20(2) Australasian Parliamentary Review 15 at 30; cf Fardon (2004) 223 CLR 575 at 646 [190]; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 125 [203]. Kirby The facts The background facts are described in the reasons of Gummow, Hayne, Heydon and Kiefel JJ ("the joint reasons")46 and in the reasons of Crennan J47. As those reasons point out, there has been no adjudication of the underlying proceedings by which the Gypsy Jokers Motorcycle Club Incorporated ("the appellant") invoked the jurisdiction of the Supreme Court. It did so by an originating summons claiming an order for review from the Supreme Court pursuant to s 76 of the Act. The application for review challenged the decision of the Commissioner of Police of Western Australia ("the Commissioner") to issue a "fortification removal notice" ("notice") to the appellant. Initially, an identified police officer was named as the respondent. Subsequently, when the judge of the Supreme Court before whom the summons was returned (Blaxell J) referred the validity of s 76 or alternatively s 76(2) of the Act for the opinion of the Court of Appeal48, the name of the respondent was changed to the State of Western Australia. By the time the orders of the Court of Appeal were made, the Commissioner had been substituted as respondent. That is the form in which the proceedings come before this Court. Because of the terms of s 76 of the Act, it is the correct form49. Although special leave was granted in respect of the whole of the decision of the Court of Appeal, the only point argued by the appellant concerned the validity of s 76(2) of the Act. The appellant did not dispute that s 76 was otherwise valid. Given that, in these proceedings, the appellant initiated the s 76 "review", a general invalidation of the section would destroy its proceedings. The Commissioner contended that even if s 76(2) were invalid, the sub- section could not be severed. The entire section would fall. This would leave the appellant with no statutory right of "review" of the notice issued by the Corruption and Crime Commission of Western Australia ("the Commission") pursuant to s 68(2) of the Act. Presumably, any judicial review that might then be available to the appellant would be of a general or "prerogative" kind50. Given the limited question before this Court, the availability of any such review need not be explored. However, it appears that it too would be subject to a 46 Joint reasons at [18]. 47 Reasons of Crennan J at [135]-[142], [153]-[156]. 48 Pursuant to s 43 of the Supreme Court Act 1935 (WA). 49 See in particular the Act, s 76(5). 50 See Supreme Court Act 1935 (WA), s 16. Kirby precondition of official consent for the issue of such a writ, itself a somewhat surprising requirement51. In response to the appellant's summons, the Commissioner filed an affidavit describing his application to the Commission in February 2004 for the issue of a notice. The affidavit annexed the Commissioner's application itself and other related documents. Given that some two years elapsed between the issue of the notice in May 2004 and the referral to the Court of Appeal in May 2006, and that nearly two further years have elapsed since, it scarcely seems arguable that an urgent problem of dangerous fortification or organised crime52 exists in this case. Otherwise, one would have expected the authorities to have sought expedited hearings and facilitated a prompt determination of the review. The languid pace of the proceedings sits most oddly with the highly exceptional features of s 76(2). This Court was informed that, whilst the proceedings were pending at first instance, a video film of the appellant's allegedly offending premises was shown, over the objection of the Commissioner. The primary judge was asked to "accommodate a view"53. I take this to have meant an inspection by him of the premises. His Honour reserved his position on that apparently sensible application. Once the legal questions were reserved for the Court of Appeal, the proceedings went into hibernation. Most of the contents of the Commissioner's affidavit (and the annexures) were made available to the appellant. However, certain paragraphs were blacked out and indecipherable. This is the form in which the documents appear in the record as it has been seen by this Court, as presumably also by the Court of Appeal. These proceedings concern the validity of the operation of the Act on the use that may be made by the Supreme Court of the information the documents contain, including that part of it masked in this way. The legislation The joint reasons describe the overall scheme of the Act, the provisions governing "fortifications" and the way in which the Commissioner may apply to the Commission for the issue of a notice obliging the removal or modification of 51 The Act, s 83. See reasons of Crennan J at [152]. 52 See the Act, s 72(2). 53 [2007] HCATrans 551 at 152 [6810]. Kirby such fortifications54. Additional particulars are contained in the reasons of Crennan J55. The joint reasons explain how the Supreme Court is "drawn into [the] statutory scheme"56 and how the Act affords an "owner or an interested person" an entitlement to invoke the jurisdiction and powers of the Supreme Court to conduct a "review" of the Commissioner's decision to issue the notice57. Although the relevant provisions of s 76 of the Act are set out in other reasons, that section is critical to this appeal, and I will reproduce so much of it as is essential to my analysis: "76 Review of fortification removal notice If a fortification removal notice relating to premises has been issued, the owner or an interested person may, within 7 days after the day on which the notice is given to the owner of the premises, apply to the Supreme Court for a review of whether, having regard to the submissions, if any, made before the submission period elapsed and any other information that the Commissioner of Police took into consideration, the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice. The Commissioner of Police may identify any information provided to the court for the purposes of the review as confidential if its disclosure might prejudice the operations of the Commissioner of Police, and information so identified is for the court's use only and is not to be disclosed to any other person, whether or not a party to the proceedings, or publicly disclosed in any way. 54 Joint reasons at [13]-[16]. 55 Reasons of Crennan J at [143]-[150]. 56 Joint reasons at [17]. 57 Joint reasons at [26]-[27]. See also reasons of Crennan J at [151]. Kirby The court may decide whether or not the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice. If the court decides that the Commissioner of Police could not have reasonably had the belief required by section 72(2) when issuing the notice, the notice ceases to have effect. The decision of the court on an application for review under this section is final …" The decision of the Court of Appeal Majority opinions: The principal reasons for the majority in the Court of Appeal were given by Steytler P. His Honour undertook an analysis of the decisions of this Court, and of intermediate courts, in which the "Kable principle" had been considered58. He noted that the only decision of an intermediate court in which the principle had proved effective to invalidate legislation was Re Criminal Proceeds Confiscation Act 2002 (Qld)59, a decision of the Queensland Court of Appeal. Steytler P accepted that there were "aspects of s 76 that are antithetical to the judicial process". He said60: "It is unfair to give to one party to a controversy (that directly affects property rights) a power, effectively, to prevent evidence, relevant to and potentially decisive of the controversy, from being disclosed to the other party to that controversy. The unfairness of this process seems to me to be incontrovertible, no matter how well-intentioned the former party might be thought to be and even if (which is not suggested by either party) it might be implicit in the section that the Supreme Court is itself able to make some (necessarily limited) assessment as regards the question whether disclosure the Commissioner and therefore whether confidentiality has properly been claimed. There is no doubt that s 76(2) has the potential to result in a serious denial of natural justice … The situation is made worse by the inability of the court to publicly explain its decision by way of adequate reasons … when its decision turns upon the confidential information, as it often will, and by the denial of any right of appeal." fact prejudice operations of 'might' 58 (2007) 33 WAR 245 at 266-273 [77]-[95]. 59 [2004] 1 Qd R 40 cited (2007) 33 WAR 245 at 266 [77]. 60 (2007) 33 WAR 245 at 276 [106]. Kirby Nonetheless, Steytler P concluded that the offending features of s 76(2) of the Act were insufficient to support a finding of invalidity. The sub-section did not "compromise the institutional integrity of the court to such an extent that it is no longer a court of the kind contemplated by Ch III of the Commonwealth Constitution"61. In coming to this conclusion, his Honour was clearly affected by what he took this Court to have held in earlier cases, including Fardon v Attorney-General (Qld)62 and Forge v Australian Securities and Investments Commission63. Steytler P pointed out that courts are "often required to implement laws of which they disapprove"64. In light of this Court's decisions since the Kable principle was first expounded, he described the challenge facing the appellant as a "substantial hurdle"65. Relevant to his conclusion was what he described as the "very limited function given to the court by s 76"66. He decided that, as in Fardon, the Supreme Court was "still able to exercise some form of genuine evaluative or adjudicative review"67. He felt reinforced in this opinion by the approach of the Full Court of the Supreme Court of South Australia in Osenkowski v Magistrates Court of South Australia68 and by a reflection on the way in which Australian courts in the past have dealt with claims of public interest immunity69. Martin CJ, in separate reasons, agreed with Steytler P's conclusion70. He also addressed some additional comments to what he called the "tension between 61 (2007) 23 WAR 245 at 276 [107]. 62 (2004) 223 CLR 575. 63 (2006) 228 CLR 45. See (2007) 33 WAR 245 at 276-277 [109]. 64 (2007) 33 WAR 245 at 276 [107]. 65 (2007) 33 WAR 245 at 277 [110]. 66 (2007) 33 WAR 245 at 277 [110]. 67 (2007) 33 WAR 245 at 277 [110] referring to Fardon (2004) 223 CLR 575 at 656 68 (2006) 96 SASR 456 at 467 [28] cited (2007) 33 WAR 245 at 278 [113]. 69 (2007) 33 WAR 245 at 277-278 [112] referring to Church of Scientology Inc v Woodward (1982) 154 CLR 25 at 61; Sankey v Whitlam (1978) 142 CLR 1 at 38- 70 (2007) 33 WAR 245 at 248 [1]. Kirby the contemporary desire to afford judicial review of administrative decisions and the occasional need to protect the confidentiality of the material to be relied upon in conducting the review"71. He referred to decisions addressing that tension in the United Kingdom, Europe, New Zealand, Canada and the United States of America72. He laid emphasis on the fact that no Australian authority could be cited "in support of the proposition that unrestricted access by a party to all the information upon which a court relies for its adjudication of the case before it, is an essential or indispensable aspect of a fair trial"73. Martin CJ concluded that s 76 "does not, singularly, constitute a departure from accepted judicial process … [or] compromise the institutional integrity of this Court"74. Dissenting opinion: Wheeler JA, in dissent, also examined recent decisions of this Court. Drawing upon the joint reasons in Wilson v Minister for Aboriginal and Torres Strait Islander Affairs75, she considered that essential to the Kable principle was the requirement that special care be taken in the performance by all judges, federal or State, of activities that are rendered "subject to instruction by the Legislature or the Executive in [that] performance"76. Her Honour concluded77: the principles enunciated "[I]f one applies the consideration which is fatal to the validity of s 76(2) is that the court is required to determine the validity of Executive action in circumstances in which the procedure it adopts is dictated by a decision made … by an officer of the Executive, rather than by the court either applying a law or instrument made under a law, or exercising its own inherent jurisdiction to regulate its procedures." in Wilson, then Supportive of Wheeler JA's conclusion was a principle that she derived from observations of the United States Supreme Court in Mistretta v United States78, mentioned by Gummow J in Kable79 and by other judges earlier both in 71 (2007) 33 WAR 245 at 249 [9]. 72 (2007) 33 WAR 245 at 249-261 [10]-[55]. 73 (2007) 33 WAR 245 at 261 [56]. 74 (2007) 33 WAR 245 at 263 [62]. 75 (1996) 189 CLR 1 at 17 cited (2007) 33 WAR 245 at 284-285 [144]. 76 (2007) 33 WAR 245 at 285 [145]. 77 (2007) 33 WAR 245 at 286-287 [152]. 78 488 US 361 at 407 (1989). See reasons of Crennan J at [168]. Kirby Grollo v Palmer80 and in Wilson81. That principle was said to be to the effect that it is impermissible for other branches of government to impose on judges a task amounting to "a grossly unjudicial chore"82, in an attempt to "borrow" the judiciary's "reputation for impartiality"83. Wheeler JA accepted that there were arguments favouring a conclusion that s 76(2) was valid. However, "the concatenation of factors" that she identified led her to an opposite result84. My reasoning in this case proceeds along lines similar to that of Wheeler JA. The issues Three issues arise for decision: The construction issue: What is the meaning and operation of s 76 of the Act, and in particular of s 76(2)? What is the effect of s 76(2) as to the power of the Commissioner, an officer of the Executive Government of Western Australia85, to control (in law or practical effect) the use the Supreme Court can make of "identified" information? The Kable issue: On its correct interpretation and in light of its operation in the present case, does s 76(2) of the Act offend the constitutional principles established Is s 76(2), read with s 76(7), incompatible with the appellant's entitlement to bring an "appeal" against the Supreme Court's decision to this Court in accordance with the in Kable? 79 (1996) 189 CLR 51 at 133. 80 (1995) 184 CLR 348 at 377 per McHugh J, 392 per Gummow J. 81 (1996) 189 CLR 1 at 9 per Brennan CJ, Dawson, Toohey, McHugh and 82 Hobson v Hansen 265 F Supp 902 at 930 (1967) cited Kable (1996) 189 CLR 51 at 83 (2007) 33 WAR 245 at 289 [160]. 84 (2007) 33 WAR 245 at 289 [162]. 85 Police Act 1892 (WA), s 5. 86 Constitution, s 73. Kirby The severance issue: If s 76(2) is invalid, should this Court sever it from the remainder of s 76, leaving issues of confidentiality and Executive privilege to be decided by reference to the common law governing public interest immunity and non-disclosure of confidential evidence? Would such severance amount, as to an impermissible rewriting of the Act? the Commissioner contends, The interpretation of s 76 of the Act Importance of interpretation: In constitutional adjudication it is important first to construe the legislation that is in issue87. The adoption of a particular construction might narrow, or obviate altogether, the constitutional question. It is therefore axiomatic that the starting point must be a precise understanding of what the impugned law means and how it is intended to operate in given circumstances. Only one judge in the Court of Appeal made express reference to this starting point. That was Wheeler JA. Her Honour acknowledged Gummow J's observation in Fardon88 to the effect that the question of whether a State law is incompatible with the exercise of federal judicial power requires both "close attention to the detail of impugned legislation" and advertence to the fact that the critical notion of "incompatibility" may be "insusceptible of further definition in terms which necessarily dictate future outcomes". Correctly, in my view, these remarks call attention to the evaluative character of the question presented by the Kable principle. It is not really surprising that, over time, the Justices of this Court have had differences of opinion as to its application. The principle is expressed in words of considerable generality. It invokes deep-lying notions about the nature and requirements of the system of governance established by the Constitution. In effect, the Kable principle demands that judges give meaning and effect to public values, as explained by Professor Owen Fiss in the quote at the outset of these reasons89. The evolution of the construction issue: Wheeler JA noted that there was "little argument addressed to the [Court of Appeal] about the proper construction and effect of s 76"90. Nevertheless, it is clear that each of the judges below was 87 Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 186 per Latham CJ; R v Hughes (2000) 202 CLR 535 at 565-566 [66]; Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 662 [81]; cf joint reasons at [11]. 88 (2004) 223 CLR 575 at 618 [104] cited (2007) 33 WAR 245 at 289 [162]. 89 See above these reasons at [46]. 90 (2007) 33 WAR 245 at 280 [128]. Kirby cognisant of their obligations in this regard. However, none of those judges took a view of s 76 that was as narrow as that now adopted in the majority reasons in this Court. In particular, none of those judges supposed that the Commissioner's "identification" of particular information as confidential gave rise to a justiciable issue. A thorough examination of the relevant documents reveals that the construction issue developed in the following manner: all three judges in the Court of Appeal proceeded on the assumption that the Commissioner's power of identification was both exclusive and conclusive; the parties did not challenge this assumption in that Court; the appellant in this Court framed its written submissions on the basis that the Court of Appeal's understanding was not under challenge; neither the Commissioner nor the interveners foreshadowed an attack on that understanding in their written submissions. Indeed, their written submissions indicate that all of them approached the matter on the basis that the propounded understanding was correct; the construction argument now accepted in the reasons of the majority in this Court appears first to have been raised during the Commissioner's oral submissions; and most of the interveners embraced the novel argument in the course of their oral arguments in the hearing before this Court. The Court of Appeal: The joint reasons conclude that Wheeler JA fell into error in accepting the premise that s 76(2) accords unilateral power to the Commissioner to determine that information is subject to a non-disclosure requirement91. However, it is apparent that Martin CJ and Steytler P also proceeded on that basis. So much is certainly implicit in their reasons. Martin CJ refers, for instance, to the "statutory authority given to the Commissioner of Police to determine that information provided to the court for the purposes of its review shall not be disclosed to any other person"92. Steytler P refers to "the Commissioner's right to claim confidentiality, and hence 91 Joint reasons at [34]. See eg (2007) 33 WAR 245 at 286-287 [148]-[152]. 92 (2007) 33 WAR 245 at 248 [6] (emphasis added). See also at 262 [59], 262-263 Kirby to limit the extent to which the information relied upon by him should be disclosed"93. All of the relevant discussion in the Court of Appeal, then, was founded on the assumption that the Commissioner could make an effective and conclusive "identification" without the imprimatur of the Supreme Court. Indeed, it is the opposite the apparent from certain remarks of interpretation, now embraced by the majority in this Court, was not even pressed in the Court of Appeal. Steytler P noted that it was "not suggested by either party" that s 76(2) envisaged even a limited role for the Supreme Court in assessing "whether confidentiality has properly been claimed"94. judges below that A shift in the argument: In this Court, the appellant's arguments assumed the correctness of the Court of Appeal's interpretation of s 76(2). Neither the Commissioner nor any of the interveners attempted, in their written submissions, to challenge that assumption. Each acknowledged, either expressly or implicitly, that s 76(2) obliged the Supreme Court to conform to the decision of the Commissioner. Each sought to meet the submissions of the appellant on that footing. It was not until the matter came before this Court for oral argument that the suggestion was first made that "section 76(2) does not render unexaminable by the Court the decision of the Commissioner of Police"95. According to "[I]f the Court determined that disclosure of the information identified as confidential could not prejudice the Commissioner’s operations, then that information would be information in relation to which there would not be an efficacious identification – if I could pick up the words of section 76(2) – for the purpose of that provision, and the material, that information, would be available to the other side." Most of the interveners then embraced this novel interpretation of s 76(2) in the course of oral argument. At one point, I remarked that I had never "seen so many law officers coming along … trying to read down the words of a Parliament"97. Normally, in this Court, one becomes accustomed to submissions urging the widest meaning of governmental legislation and the largest ambit of 93 (2007) 33 WAR 245 at 277 [110] (emphasis added). See also at 276 [106]. 94 (2007) 33 WAR 245 at 276 [106]. See also at 280-281 [128] per Wheeler JA. 95 [2007] HCATrans 550 at 52 [2323]. 96 [2007] HCATrans 550 at 63 [2809]. 97 [2007] HCATrans 551 at 137 [6157]. Kirby constitutional power to support it. At least one of the interveners, whilst embracing the narrow construction of the Act in oral argument, acknowledged that it was inconsistent with their written submissions, which had been drafted on the basis of the same "construction on which the court below proceeded"98. A novel interpretation: Thus, neither in the submissions of the parties before the Court of Appeal nor at an initial stage in this Court was the narrow view of s 76(2) advanced as a viable interpretation. Nevertheless, that is the view now accepted by the other members of this Court99. This is not the first time that this Court has adopted a novel interpretation of impugned legislation100. Of course, the Court has its own obligations in giving effect to legislation as it understands it. At least in this case, the novel interpretation was signalled in the course of oral argument. It was put to the parties and interveners during the hearing. However, it is important to appreciate that this interpretation represents a marked departure from that accepted or assumed by everyone to be correct before the appeal reached this Court. Defects of the new interpretation: So far, the Kable principle has not attracted a substantial application from this Court, having never been applied since Kable itself. It has been suggested that "the principle may be operating prophylactically"101. One manifestation of this could be the reading down of State legislation so as to avoid inconsistency with the Kable principle. If I could adopt the narrower view of s 76(2) of the Act, I would. However, in my opinion, it is artificial. Even making full allowance for applicable canons of construction, protective of the jurisdiction and powers of the Supreme Court, it is not an expression of the true meaning and operation of the provision as enacted and expressed to achieve a clear legislative purpose. The Court of Appeal's interpretation of s 76(2) gives effect to the natural meaning of the text of that provision. It is plain that the term "information so identified" refers to information "identified" on the part of the Commissioner, 98 [2007] HCATrans 551 at 94 [4179]. 99 Reasons of Gleeson CJ at [1]; joint reasons at [31]; reasons of Crennan J at [170]- 100 See eg Combet v The Commonwealth (2005) 224 CLR 494 at 611-613 [279]-[283]; cf at 566-567 [128]-[134]. 101 Forge (2006) 228 CLR 45 at 125 [203] citing Wheeler, "The Kable Doctrine and State Legislative Power Over State Courts", (2005) 20(2) Australasian Parliamentary Review 15. Kirby and the Commissioner alone. It is the Commissioner in whom the power of identification is reposed in the preceding words of the sub-section. No other view is compatible with the text and structure of the Act. Once the "information" is "so identified", its use is subject to the closing words of s 76(2). The Court is instructed that the information "is" available only for its own use, and "is not" to be disclosed to any other person (emphasis added). These consequences are not provisional or conditional, but rather arise as a simple function of the fact of "identification". It follows that whatever the Supreme Court might think or wish or need to do as a court, if the provisions of the Act are valid in these respects, the prohibition on disclosure is absolute. It carries into effect not the Supreme Court's ultimate judgment on the information, but in substance, and in law, that of the Commissioner. The alternative construction of s 76(2) seizes upon the words "if its disclosure might prejudice the operations of the Commissioner of Police" as though their effect is to conjure up a role in this scheme, overlooked until now, for the Supreme Court. However, the sub-section provides no indication that that criterion is for the Supreme Court to examine. The criterion is, rather, referable to the power of identification. That is a power reserved to the Commissioner. Had the legislature of Western Australia intended the construction now accepted in this Court to prevail, there would have been obvious ways of expressing that intention. One of any number of drafting conventions could have been employed to indicate that the Supreme Court was to be vested with an oversight role. However, the sub-section does not provide, for instance, that the Supreme Court must be "satisfied" that an identification was proper, or envisage the Commissioner making an "application" to have information quarantined. There is nothing analogous in this context to s 76(5) of the Act, which makes explicit the ability of the Supreme Court to "decide whether or not the Commissioner … could have reasonably had the belief required by section 72(2) when issuing the notice". Rather, s 76(2) establishes an apparently simple consequential scheme by which the Commissioner's act of identification has the results stated in the sub-section. In this context, I cannot accept that the present case is one in which infelicitous drafting has served to obscure the legislative intention. The intention is all too clear. The correct interpretation: The first impressions of the judges in the Court of Appeal, and of the parties below and in their written submissions in this Court, were correct. Section 76(2) permits the respondent to the review (the Commissioner) to determine conclusively the ambit and identity of the confidential information which must not be disclosed to the applicant. This interpretation entails a number of practical consequences: The final decision-maker on the confidentiality of identified information is the Commissioner and not the Supreme Court; Kirby The Supreme Court cannot override or reverse the Commissioner's "identification" of "confidential", however unreasonable such identification might appear to the Supreme Court to be; information the The Supreme Court is precluded from disclosing such information, including to the applicant for review, even if some disclosure is essential to permit the applicant to meet the case put against it or to make responsive submissions; and In giving reasons for its decision, the Supreme Court cannot, however important such information is to its reasoning, disclose it, even in a limited or guarded manner. The development of judicial review: The character of s 76(2) becomes even more clear when developments of judicial review in Australia and England over the past 50 years are remembered. In Duncan v Cammell, Laird and Co102, following the failure of the submarine Thetis to resurface after a trial dive with the loss of many lives, dependants of the victims sued the shipbuilders for negligence. In a wartime decision, the House of Lords held that the sole arbiter of the public interest in relation to whether government documents, otherwise relevant and liable to production, should be produced to the court, was the relevant Minister. that courts retained a "reserve power", available Earlier, in Robinson v South Australia [No 2]103, an Australian case involving commercial transactions of a State government, the Privy Council had held in exceptional circumstances, to call for the production of documents over which Crown privilege had been claimed. After inspection, the court could disallow the claim if it were clear that it was unreasonable. That decision was disapproved by the House of Lords in Duncan. Following Duncan, courts in a number of Commonwealth jurisdictions gradually reasserted the residual judicial power to overrule a claim of Crown privilege104. Thus, Australian courts approved and applied Robinson, preferring 103 [1931] AC 704. See de Smith, Judicial Review of Administrative Action, 3rd ed 104 See eg R v Snider [1954] SCR 479; Gagnon v Commission des Valeurs Mobilières du Québec [1965] SCR 73; Corbett v Social Security Commission [1962] NZLR Kirby it to the House of Lords decision in Duncan105. The legal position was not corrected in England until a line of decisions culminating in Conway v Rimmer106. The effect of these decisions was that the ratio in Duncan had been unnecessary, obiter and wrong. Professor de Smith, and other commentators, recognised that the reversion to the previous understanding of the residual function of the courts rendered Conway a decision "of first-rate importance"107. Yet, however important it was in the English context, it represented no more than the re-expression of a basic law inherent in the Australian constitutional setting. Here, the integrated Judicature of the Commonwealth, its separate constitutional position and its high importance in deciding federal questions, rendered notions of unreviewable Executive or legislative decision-making unpersuasive, at least where the "judicial process" was concerned. The re-expression of the English law was promptly approved and endorsed by this Court in Sankey v Whitlam108. the background of In an Australian context, and certainly in federal courts, English constitutional notions of conclusive ministerial certificates must now be seen as of dubious legal validity. Their status under the Australian Constitution in respect of constitutional facts was specifically reserved by this Court in Attorney- General (Cth) v Tse Chu-Fai109. The Act in question in these proceedings must be considered against the foregoing historical and constitutional developments. So much is made clear by the assertion on the part of the Commissioner that it was open to the Parliament of Western Australia to "take up the common law position adopted for a time after the decision in Duncan … and [to] make the issue of an official certificate [on the part of the Commissioner] the factum on which the law requiring or prohibiting admission of evidence operated". It is submissions such as this that lead me to my conclusion that the true "intention" or purpose of the Parliament in the challenged provisions of the Act was all too clear. Effectively, the Police Commissioner's identification of confidential information was akin to a conclusive ministerial certificate, as upheld in Duncan. 105 See eg Christie v Ford (1957) 2 FLR 202; Bruce v Waldron [1963] VR 3; Ex parte Brown; re Tunstall (1966) 67 SR (NSW) 1. 106 [1968] AC 910. See also Re Grosvenor Hotel, London (No 2) (1965) Ch 1210; Merricks v Nott-Bower [1965] 1 QB 57; Wednesbury Corporation v Ministry of Housing and Local Government [1965] 1 WLR 261; [1965] 1 All ER 186. 107 de Smith, Judicial Review of Administrative Action, 3rd ed (1973) at 37. 108 (1978) 142 CLR 1 at 38. 109 (1998) 193 CLR 128 at 149 [54]. Kirby Conclusion: The meaning of s 76(2): The response to this challenge in the majority reasons is to narrow the operation of s 76(2) so as to reduce the absolute conclusiveness of the Commissioner's determination that particular information is confidential. Whilst I fully understand the purpose of adopting that approach, it is difficult to reconcile it with the language of s 76(2) and with the expressed defence of its historical basis and of the supposed constitutional entitlement of the State Parliament to so provide. It follows that the Court of Appeal's interpretation of s 76(2) of the Act was correct. It reflects the language of the sub-section. It gives effect to the purpose that lay behind the enactment of such an extraordinary and virtually unique provision110. It upholds the purpose which the Commissioner was propounding in his submissions, virtually to the last moment. The question that then arises is whether a provision such as s 76(2) of the Act, so understood, attracts the Kable principle. In my view, it does. The Kable principle applies Serious burden on institutional integrity: As Wheeler JA concluded, the legislative scheme embodied in s 76(2) of the Act is incompatible with the institutional integrity of the Supreme Court which, in turn, is essential to that Court's place in the integrated Judicature of the Commonwealth. It impinges impermissibly on the Supreme Court's expressed role as a court with constitutional functions111, as a court that might be vested with federal jurisdiction112 and as a court whose judgments and orders enliven a right of appeal to this Court which cannot be abolished113. In a number of cases I have endeavoured to explain the essential elements of the Kable principle114. Although stated in slightly different terms by the 110 It was accepted in argument that the provision was virtually unique in Australian legislation. See [2007] HCATrans 551 at 144 [6465] (Federal Attorney-General). The only suggested comparable provision was that considered in Elbe Shipping SA v Giant Marine Shipping SA (2007) 159 FCR 518, which is distinguishable. 111 Constitution, s 73(ii). 112 Constitution, s 77(iii). 113 Constitution, s 73(ii). 114 See eg Baker (2004) 223 CLR 513 at 541-544 [74]-[84]; Fardon (2004) 223 CLR 575 at 626-631 [136]-[144] and Forge (2006) 228 CLR 45 at 121-125 [192]-[203]. Kirby several judges in the majority in Kable, the distinctions of expression are less significant than the unity of the constitutional concept. No party and no intervener in this appeal doubted, questioned or criticised that concept. Instead, the task of the Court was presented as the application of the principle to the circumstances of this case. I fully recognise that, in a number of decisions, I have adopted a more ample view of the application of the Kable principle than some of my colleagues. No doubt my differences from the majority in this respect derive from a disagreement over the "public values" that are at stake and different perceptions of the risks that are presented by erosions of what have hitherto been normal attributes of the "judicial process" in Australia. I have therefore tested the explanation of the Kable principle in the present context not by reference to my own earlier reasons in dissent (although I adhere to those reasons) but by reference to the notions of "institutional integrity" explained in the reasons of those who have formed the majority on such questions. Important amongst the statements about the requirements of "institutional integrity" essential to State courts after Kable is the following passage from the joint reasons of Gummow, Hayne and Crennan JJ in Forge115: "Because Ch III requires that there be a body fitting the description 'the Supreme Court of a State', it is beyond the legislative power of a State so to alter the constitution or character of its Supreme Court that it ceases to meet the constitutional description. One operation of that limitation on State legislative power was identified in Kable. The legislation under consideration in Kable was found to be repugnant to, or incompatible with, 'that institutional integrity of the State courts which bespeaks their constitutionally mandated position in the Australian legal system'116. The legislation in Kable was held to be repugnant to, or incompatible with, the institutional integrity of the Supreme Court of New South Wales because of the nature of the task the relevant legislature required the Court to perform. At the risk of undue abbreviation, and consequent inaccuracy, the task given to the Supreme Court was identified as a task where the Court acted as an instrument of the Executive117. The consequence was that the Court, if required to perform the task, would not be an appropriate 115 (2006) 228 CLR 45 at 76 [63] (emphasis added). 116 Fardon (2004) 223 CLR 575 at 617 [101]. 117 Kable (1996) 189 CLR 51 at 124, 134. Kirby recipient of invested federal jurisdiction. But as is recognised in Kable, Fardon v Attorney-General (Qld)118 and North Australian Aboriginal Legal Aid Service Inc v Bradley119, the relevant principle is one which hinges upon maintenance of the defining characteristics of a 'court', or in cases concerning a Supreme Court, the defining characteristics of a State Supreme Court. It is to those characteristics that the reference to 'institutional integrity' alludes. That is, if the institutional integrity of a court is distorted, it is because the body no longer exhibits in some relevant respect those defining characteristics which mark a court apart from other decision-making bodies." According to this explanation of the Kable principle, what sets a court apart is the feature, inherent in its constitution and functions, of independence and impartiality. It is a governmental institution. But it is one of a particular kind. It must act in particular ways. There may be innovations and differences between courts. However, there are limits upon permissible departures from the basic character and methodologies of a court. As a nominated court, expressly provided for in the Constitution, a Supreme Court of a State plays an essential role in the governance of the State and the nation. It adjudicates disputes between constituent parts of the federation. It also adjudicates disputes between individuals and government in its various manifestations. In Bass v Permanent Trustee Co Ltd120, the joint reasons said: "Judicial power involves the application of the relevant law to facts as found in proceedings conducted in accordance with the judicial process. And that requires that the parties be given an opportunity to present their evidence and to challenge the evidence led against them." In addition to these essential features of the judicial process, it is inherent in the constitutional design that an adjudication by such a court will permit a disappointed party to engage effectively with the appellate jurisdiction of this Court. So much is made clear in BHP Billiton Ltd v Schultz121. Despite the statement in s 76(7) of the Act that a decision on an application for review is "final"122, I agree with the joint reasons that such a provision cannot exclude the 118 (2004) 223 CLR 575. 119 (2004) 218 CLR 146 at 164 [32]. 120 (1999) 198 CLR 334 at 359 [56] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ (emphasis added, footnotes omitted). 121 (2004) 221 CLR 400 at 433 [55], 453 [127]. 122 Thereby attracting s 60(1)(c) of the Supreme Court Act 1935 (WA). Kirby constitutional right of appeal to this Court123. So much was not ultimately contested by the Commissioner. The basic error of the majority in the Court of Appeal lay in their conclusion that, to find offence to the Kable principle, the appellant had to show that the impugned legislation rendered the Supreme Court "no longer a court of the kind contemplated by Ch III"124. If that were indeed the criterion to be applied, it would be rare, if ever, that constitutional incompatibility could be shown. Kable's constitutional toothlessness would then be revealed for all to see. The fact is that, whatever the outcome of this case, the Supreme Court would continue to discharge its regular functions. Overwhelmingly, it would do so as the Constitution requires. A particular provision, such as s 76 of the Act, will rarely be such as to poison the entire character and performance by a Supreme Court of its constitutional mandate as such or alone to result in a complete re- characterisation of the Court. Adoption of such an approach would, in effect, define the Kable doctrine out of existence. This should not be done. Kable recognised an important principle arising from the unique features of the Judicature of Australia. Such features necessitate vigilant protection of the State courts and their processes. The proper application of the Kable principle requires a close examination of the particular provision that is impugned. Such an examination is performed so as to prevent attempts to pollute the jurisdiction and powers of the State Supreme Courts. Special vigilance is required whenever it appears that other branches of government may be attempting to interfere with the independence and impartiality of the State courts or to trade on the reputational capital which such courts have won by their special character and established methodologies. Application to the present case: I agree with Wheeler JA that, in combination, a number of features of s 76(2), understood as intended to operate, render it seriously incompatible with the institutional integrity of the Supreme Court. Those features are: The special power afforded to the Commissioner to deem "information" provided to the Supreme Court to be "confidential", with consequences that are binding on the Supreme Court in the manner in which it discharges its functions as such. Such consequences arise pursuant to the decision of the Commissioner rather than by the application of norms of law or by the exercise of the inherent jurisdiction of the Supreme Court. The fact that there may, or may not be, a place for review by the Supreme 123 See joint reasons at [20]. 124 (2007) 33 WAR 245 at 276 [107] per Steytler P. See also at 248 [1] per Martin CJ. Kirby Court of the Commissioner's decision is irrelevant to this power of "identification", which, under s 76(2), belongs only to the Commissioner; The power is provided to the Commissioner to control or influence the basic issue for determination, that is, the reasonableness of his own belief. This feature of s 76(2) has the appearance (and in my view the legal consequence) of permitting the subject of the "review", in effect, to stack the cards. It affords the Commissioner control, and certainly great influence, over the decision that the Supreme Court makes in the review adjudication concerning his own conduct. To say the least, it is not normal to the judicial process in Australia that a party, especially a governmental party, can control conclusively information which a court may use in conducting a review of that party's own determinations; The Commissioner is thus afforded the power to control (and certainly profoundly to influence) the manner in which the Supreme Court performs its function of ensuring, so far as is possible, general equality between the parties to the adjudication125. If, by the decision of a subject of the review, the Supreme Court is controlled (or even greatly influenced) in the way in which it secures evidence, and responses and submissions of the opposing parties, a real adjudication may prove impossible. Courts have long experience in balancing the need to ensure a real adjudication whilst protecting other interests in relation to, for example, national security, public interest immunity and confidentiality. But s 76(2) of the Act reserves the decision on the balance in this case to the Commissioner. In law (or certainly in substance), it subtracts the independence and utility of the decision of the Supreme Court. The result is that the Supreme Court, whilst appearing to perform a judicial adjudication will in many, perhaps most, cases be unable to do so; The proscription of the disclosure "in any way" of information "identified" by the Commissioner may, and in many cases will, prevent the Supreme Court from providing proper reasons for its judgment and orders. This too impinges on what is now a settled and universal feature of the judicial process in Australia126. Courts are well accustomed, where it is required, 125 Leeth v The Commonwealth (1992) 174 CLR 455 at 483-490 per Deane and Toohey JJ, 501-503 per Gaudron J; cf at 466-469 per Mason CJ, Dawson and McHugh JJ, 475-478 per Brennan J; Kruger v The Commonwealth (1997) 190 CLR 1 at 112 per Gaudron J. See Parker, "Protection of Judicial Process as an Implied Constitutional Principle", (1994) 16 Adelaide Law Review 341 at 350-353. 126 Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 259-261, 268- 269, 277-278; Public Service Board of NSW v Osmond (1986) 159 CLR 656 at Kirby to anonymising information, avoiding identifiers and adopting expedients to protect confidential evidence or like interests. In this case the Supreme Court is not trusted to do this. A general and legally (or substantially) unreviewable determination by a party to the proceedings is imposed on the Supreme Court by that party. This removes from that Court the judgment and function normal to it as such; and By limiting both the legal and effective participation of the party challenging the Commissioner in the review proceedings and preventing the Supreme Court from revealing information, the process may render pointless or unavailing the facility of appeal to this Court envisaged by the Constitution. Moreover, the inability of the Supreme Court to provide proper reasons for its decision where such reasons would, in any way, disclose information designated by the Commissioner as "confidential", renders nugatory the engagement of the constitutional right to appeal from a judgment or order of a State Supreme Court. It has been suggested that the Supreme Court can continue to perform effective judicial review in the face of the provisions of s 76(2) of the Act. But this argument collapses when it is recognised that it is the Commissioner's act of identification (not the quality of the information) that, in accordance with the sub- section, attracts the imperative requirement of non-disclosure. Assuming the alternative construction: If the interpretation of s 76(2) of the Act favoured in the majority reasons is adopted, the offence to the "judicial process" is reduced. However, it is by no means eliminated. The words of the sub-section cannot be effaced from the Act. The Commissioner, as the repository of statutory power, still has the power to "identify … information provided to the court". The Commissioner still has a right to designate any such information as "confidential". When the Commissioner (rather than the Supreme Court) so identifies "information", it is the Commissioner's decision that has the consequences stated in the sub-section. Not the Supreme Court's, applying a stated legal norm. The judicial process is compromised regardless of whether or not there is a review process that the trial judge is entitled to undertake in relation to the basis upon which the Commissioner has directed the Supreme Court that particular information is "confidential". The interpretation now adopted by the majority does not overcome the denial of equal justice implicit in affording a power of identification to one party to proceedings before the Supreme Court. It does not cure, or permit that Court to repair, the inability of the complaining party, when information is withheld from it, to make meaningful submissions, effectively to object to or answer evidence of which it is not informed, to provide meaningful reasons in support of a decision and to engage the constitutional right to appeal. This Court should not salve its conscience about a provision such as s 76(2) with the false hypothesis that a hitherto unnoticed construction of s 76(2) Kirby will render the "review" available under s 76 a real and effective adjudication between the parties. I deprecate defining constitutional problems out of existence. Irrelevant considerations: Many irrelevancies were raised by the respondent and the interveners in defending the orders of the Court of Appeal. I will respond to some of these. Victoria urged that the Act obliged the Commissioner to receive and consider submissions from the recipient of a "fortification warning notice" prior to issuing a "fortification removal notice"127. This meant, so it was said, that failure to provide such a person with at least some particulars of the basis for the Commissioner's asserted belief at this initial stage would leave it open to the Supreme Court, in conducting a later review, to conclude that that belief could not reasonably have been held. In effect, then, the Commissioner would be forced to provide the subject of a "fortification warning notice" with sufficient information (including in respect of "confidential" material) to permit the making of responsive submissions. Even assuming that this understanding of the Act is correct, the fact that there might in practice be scope for the Supreme Court to reason (in a circuitous manner) towards an amelioration of some of the harsher consequences of s 76(2) does not cure the essential constitutional defect manifested in the sub-section. It does not alter the fact that the Commissioner's "identification" of information is conclusive and binding on the Supreme Court. Nor does it alter the fact that, should the Supreme Court for whatever reason decline to intervene, the applicant for review will be subjected to profound procedural disadvantages128. It was said that the appellant was better off with the scheme of review established under s 76, including sub-s (2), than with nothing. There are shades of this "small mercies" submission in the proposition urged on the Court in Thomas v Mowbray concerning counter-terrorism legislation129. At least, so it was argued, s 76 secured a form of judicial "review". The appellant had an assurance that an independent judge had examined the information designated as "confidential" by the Commissioner. But if s 76(2) were invalid and severable, the appellant would retain a "review" as s 76 provides. The exclusion of "confidential" information would then be subject, as in the normal course of judicial review, to public interest immunity and confidentiality claims, but determined by the Supreme Court, not by the very party that is subject to the review. 127 See the Act, ss 69 and 72. 128 See above these reasons at [110]. 129 See Thomas v Mowbray [2006] HCATrans 661 at 104 [4517]. Kirby It was next said that all that the Act required was that the appellant should put all of its evidence before the Supreme Court, even if it did not know, and could not be told, the confidential details of the case presented against it, and said to justify the exceptional interference with the enjoyment of its property rights. The appellant had indeed tendered a video film and invited the judge to undertake a view of its premises for himself. However, in a review before a State Supreme Court, a party would not normally be obliged to present all of its evidence without knowing (even perhaps only in general terms) the case it had to meet. In the defence of its property rights, it is not ordinarily the case in Australia that a party must participate in an adjudication before a Supreme Court where important matters that may be in contest are decided by a government official who is the subject of the review and may not be disclosed to the affected party, in whatever way, so as to ensure a true contest susceptible to independent, public resolution by the judicial process. In his submissions, the Commissioner also emphasised the fact that no questions of personal liberty were raised in the appeal, simply the property rights of the appellant. However, conventionally, our legal system has been vigilant in the defence of the property rights of individuals, as well as of their liberties130. It has protected the quiet enjoyment of such rights as an attribute of constitutional government. To allow governmental or other intrusions upon such rights, clear authority of law is conventionally required. It was then said that it would have been open to the Parliament of Western Australia to exclude judicial review altogether in connection with the issue of notices131. Assuming, without deciding, that this is so, the fact remains that the Parliament of Western Australia has provided for review. Moreover, it has committed that review to the Supreme Court of the State, necessarily attracting Kable scrutiny. It was next said that State judges are often required to perform Executive functions. That may be so. However, it is not the case, in Australia, that State Supreme Courts, as such, are ordinarily assigned Executive functions. Particularly so where, performing a task, described as a "review" and involving characteristics in many ways very similar to the judicial review of administrative 130 George v Rockett (1990) 170 CLR 104 at 110-111; New South Wales v Corbett (2007) 81 ALJR 1368 at 1372-1373 [16]-[22], 1382-1383 [87]-[88]; 237 ALR 39 at 131 cf Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at Kirby decisions, the Supreme Court must do so under conditions controlled (or greatly influenced) by the very party that is the subject of the review. The respondent then argued that it was a mistake to regard the judicial obligation to provide reasons for decisions as absolute. On this view, any impediment to the Supreme Court's capacity to explain its reasons was immaterial. This is not correct. It is true that it was noted in Public Service Board of NSW v Osmond132 that the provision of reasons is a normal but not universal requirement of the judicial process in Australia. In many other contexts, where issues of confidentiality, secrecy and public interest immunity arise, the law of Australia has evolved so that the courts are entrusted to frame their reasons so as to protect confidences, immunities and secrets but at the same time provide, so far as is possible, the facilities of a genuine adjudication and an appellate process. The logical consequence of the respondent's submission is that it would be competent for a State Parliament, either generally or in particular cases, to forbid the Supreme Court giving any reasons for its decisions. Yet this would involve a most serious departure from the normal features of the judicial process as it has existed in Australia since colonial times. It would involve a grave frustration of the effectiveness of the right of appeal to this Court envisaged by the Constitution. It demonstrates the exceptional nature of a statutory provision that affords jurisdiction and power to a Supreme Court to conduct a "review" but then usurps from that Court the power and entitlement to express its reasons in a manner conformable with legal norms rather than as subject to the fiat of an officer of the Executive Government of the State whose determination is itself the very focus of the review. Next, it was asserted that courts, including State Supreme Courts, have, for a very long time, complied with restrictions in respect of what Brennan J called the "problem of confidentiality"133. So much may be granted. However, until now, at least in the State Supreme Courts of this country, that has been done in accordance with specific statutory criteria or by the exercise of the Supreme Court's own inherent or implied jurisdiction. It has not been done, as such, by force of a decision of a member of the Executive Government, acting under statutory power. Least of all has it been done in circumstances where the member of the Executive is the subject and object of the judicial review. 132 (1986) 159 CLR 656 at 666-667. 133 The expression is used by Brennan J in Kioa v West (1985) 159 CLR 550 at 629. See Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at 100 [29]. Kirby An earlier attempt to impose a blanket rule of secrecy on State courts was struck down by this Court as inconsistent with the requirements of the Constitution134. The rule does not become more tolerable because it is administered individually by an officer of the Executive under State legislation in proceedings where that officer is one of the parties, and thereby acquires lop- sided control over the levers of judicial decision-making. Finally, it was argued that Parliaments in Australia enjoy a general power to enact laws of evidence and other laws that restrict the information that may be received in judicial proceedings, federal and State. So much may be true as a general proposition. However, such laws typically reserve rulings on such matters to the courts themselves, uncontrolled in law or in substance by decisions made by a party to those proceedings. Thus, it is the courts that are conventionally entrusted with decisions on matters of confidentiality, legal immunity and secrecy. The provisions of s 76(2) of the Act are the more remarkable because they are so unusual. Neither the parties nor interveners could cite any provision equivalent to s 76(2), in any Australian legislation, despite the wealth of legal talent assembled in that common interest. With all respect, that is another factor that causes me to be vigilant in this appeal. Conclusion: Kable is engaged: The result of the foregoing analysis is that the Kable principle is enlivened. Section 76(2) of the Act impairs the institutional integrity of the Supreme Court in the ways that I have identified. Being incompatible with the Constitution, s 76(2) of the Act is invalid and of no effect. This Court should allow the appeal and decide the question referred to the Court of Appeal accordingly. The invalid provision of s 76(2) is severable The issue of severability: The issue of severability was not decided by the Court of Appeal. It was unnecessary for the majority to consider it, given their conclusion. Wheeler JA held back from deciding the issue as her orders did not govern the outcome. However, her Honour expressed a preference for the view that s 76(2) was severable. She considered that only this conclusion would give effect to s 7 of the Interpretation Act 1984 (WA). That section, in familiar form, reverses the common law presumption that legislation is designed by Parliament to operate in its entirety and is indivisible. The section provides: 134 Russell v Russell (1976) 134 CLR 495 at 507, 520, 532-533; cf at 536, 555. Kirby "Every written law shall be construed subject to the limits of the legislative power of the State and so as not to exceed that power to the intent that where any enactment thereof, but for this section, would be construed as being in excess of that power, it shall nevertheless be valid to the extent to which it is not in excess of that power." The respondent argued that s 76(2) of the Act was an integral part of a package which was intended to operate as a whole. He submitted that it could not be assumed that Parliament would have enacted the review provisions of s 76 without the restriction imposed by s 76(2), protective of the Commissioner's ultimate entitlement to have the last word in respect of the use of information he has judged to be confidential. Conclusion: s 76(2) is severable: The principles to be applied in deciding questions of severability were recently discussed in this Court, at some length, in the Work Choices Case135. It is unnecessary to repeat the governing rules which I take into account in resolving this last issue. In my opinion, the factors that caused Wheeler JA to express a tentative preference for the severability of s 76(2) from the balance of s 76, and from the remainder of Pt 4 of Div 6 of the Act, are persuasive. If s 76(2) were excised from the Act, this would not leave the Commissioner unprotected in respect of claims of public interest immunity, confidentiality and secrecy necessary to protect any such information presented as evidence to the Supreme Court. There is a well established body of common law that could be invoked on this issue. It is understood by the judiciary, including by the Supreme Court. The consequence of a conclusion of non-severability would be to eliminate completely the review provisions from s 76. Wheeler JA was fortified in her conclusion that Parliament had the purpose of providing a form of independent judicial review by "numerous references in the Parliament Debates to the existence of a right of review, and the importance which those members who participated in the debate apparently placed upon the existence of that right"136. Excision of s 76(2) of the Act would not amount to rewriting the statute. Nor would it involve this Court intruding into the proper province of the legislature. It would reflect the object of minimising the impact on the statute as a whole of the conclusion that a particular provision of a State statute is 135 NSW v The Commonwealth (2006) 229 CLR 1 at 237-243 [584]-[605], 383-384 136 (2007) 33 WAR 245 at 290 [164]. Kirby unconstitutional. It would preserve the overall scheme and operation of the Act. Yet it would do so under conditions that committed to the Supreme Court of the State a function of review that would fall to be performed in accordance with the settled features of the judicial process as it is normally observed in Australia. the sub-section This conclusion would remove the constitutional defects that I have identified. It would eliminate a unique, and happily so-far uncopied, provision. It would retain full legal protection for the information whose confidentiality was necessary to the operations of police. But it would do so in the way that is normal to the judicial process of this country – by the decision of judges, relevantly of the State Supreme Court. Not, in effect, by the decision of the Commissioner of Police. that exhibits Orders The appeal should be allowed. The orders of the Court of Appeal of the Supreme Court of Western Australia should be set aside. In place of those orders, this Court should order that Question (b) of the questions referred to the Court of Appeal, which reads "[i]s sub section 76(2) of the Corruption and Crime Commission Act 2003 (WA) valid?" be answered: "No". This Court should declare that the remainder of s 76 is valid. The proceedings should be remitted to the Supreme Court of Western Australia to be tried in a manner conformable with the foregoing answer and declaration. The respondent should pay the appellant's costs in this Court and in the Court of Appeal. Crennan CRENNAN J. The appellant is an incorporated association which owns premises described as its club house at 10 Lower Park Road, Maddington, in the City of Gosnells, Western Australia. On 12 February 2004 the Commissioner of Police of Western Australia ("the Commissioner")137 applied to the Corruption and Crime Commission ("the Commission") for the issue of a fortification warning notice in respect of the club house of the appellant. Application for a fortification warning notice is an early step in a process provided in Pt 4, Div 6 of the Corruption and Crime Commission Act 2003 (WA) ("the Act") which can culminate in compulsory removal of fortifications from certain premises. In support of the application, the Commissioner swore and filed an affidavit with 29 annexures and two exhibits, one of which was a videotape of the fortifications on surrounding premises. The application was heard and a fortification warning notice was issued on 31 March 2004. The notice referred to the Commission's satisfaction that there were reasonable grounds for believing two matters of fact: first, that the club house was "heavily fortified", and secondly, that it was "habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime". The notice went on to state that unless the Commissioner was satisfied that matters had been rectified within 14 days a fortification removal notice might be issued. On 14 April 2004, solicitors instructed by the appellant responded by letter to the fortification warning notice. That the club house was heavily fortified was not denied. Three matters were explained in the letter. First, the Maddington industrial area, in which the premises are located, was described as "an area of a high crime rate in particular for criminal offences of burglary and motor vehicle theft". Secondly, it was stated that the fortifications had received all necessary approvals. Thirdly, the fortifications were said to be necessary to ensure that "approximately 10 customised Harley Davidson Big Twin motorcycles", said to be valuable and regularly stored at the club house, were secured against theft. A key to the club house was provided to permit the Commissioner to enter the club house when "entitled to do so by Law". The letter did not address the Commission's belief that the club house was used by members of a class of persons who might reasonably be suspected of being involved in organised crime. 137 The Commissioner of Police delegated his powers and duties relating to fortification removal under Pt 4 of the Corruption and Crime Commission Act 2003 (WA) to an Assistant Commissioner. Crennan On 5 May 2004 the Commissioner issued a fortification removal notice which indicated to the appellant that removal or modification of specified fortifications would need to occur before the Commissioner would be satisfied that the premises were no longer heavily fortified. The following items at the club house were identified for removal: the front concrete perimeter wall; the access gates attached to the front concrete perimeter wall; surveillance/security cameras and monitors; and an internal door which leads from the bar area to the office area and bedrooms and hinges from that internal doorway. The notice also referred to modification of timber doors at the rear of the club house, a steel door on the right side of the club house and a steel door leading into a storeroom at the rear of the club house. On 12 May 2004, the appellant applied to the Supreme Court of Western Australia for review of the Commissioner's decision to issue the fortification removal notice. The Commissioner swore and filed an affidavit in the proceeding, in which he identified certain items of information as "confidential … on the basis that their disclosure might prejudice the operations of the Commissioner of Police". The Act The main purposes of the Act are stated in s 7A: to combat and reduce the incidence of organised crime; and to improve continuously the integrity of, and to reduce the incidence of misconduct in, the public sector." The term "organised crime" is defined in s 3 to mean: "… activities of 2 or more persons associated together solely or partly for purposes in the pursuit of which 2 or more Schedule 1 offences are committed, the commission of each of which involves substantial planning and organisation". Schedule 1 lists various offences under the Criminal Code (WA) including murder (s 279), wilful murder (s 278), causing an explosion likely to do serious injury to property (s 454) and the making or possession of explosives under suspicious circumstances (s 557). Offences under the Misuse of Drugs Act 1981 (WA), (s 32A(1)(b)) are also Sched 1 offences. Section 7B establishes how the Act's purposes are to be achieved: Crennan "(1) The Act's purposes are to be achieved primarily by establishing a permanent commission to be called the Corruption and Crime Commission. (2) The Commission is to be able to authorise the use of investigative powers not ordinarily available to the police service to effectively investigate particular cases of organised crime." Part 4, Div 6 of the Act, entitled "Fortifications", establishes a regime for the compulsory removal of fortifications from premises in certain circumstances. Section 67(1) states: "'fortification' means any structure or device that, whether alone or as part of a system, is designed to prevent or impede, or to provide any other form of countermeasure against, uninvited entry to premises". Section 67(2) provides: "Premises are heavily fortified if there are, at the premises, fortifications to an extent or of a nature that it would be reasonable to regard as excessive for premises of that kind." The Commissioner may apply, without giving notice to any person, to the Commission for the issue of a fortification warning notice (s 68(1)), as happened here. If satisfied on the balance of probabilities that there are reasonable grounds for suspecting the premises are heavily fortified, and habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime, the Commission may issue a fortification warning notice (s 68(2)). Section 69 specifies a number of matters to be included in a fortification warning notice. A person to whom such a notice is given has 14 days within which to make a submission to the Commissioner that a fortification removal notice should not be issued (ss 67(1) and 69(2)(b) which define the "submission period"). Section 73 specifies the contents of a fortification removal notice and ss 74 and 75 provide respectively for the giving and enforcing of a fortification removal notice. After certain conditions were satisfied, the Commissioner had a statutory power to remove or modify the fortifications. Under s 72(2), after the submission period has elapsed, the Commissioner cannot issue a fortification removal notice unless, after considering each submission, he or she: "… reasonably believes that the premises are – heavily fortified; and Crennan habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime." Section 76, entitled "Review of fortification removal notice", relevantly states: If a fortification removal notice relating to premises has been issued, the owner or an interested person may, within 7 days after the day on which the notice is given to the owner of the premises, apply to the Supreme Court for a review of whether, having regard to the submissions, if any, made before the submission period elapsed and any other information that the Commissioner of Police took into consideration, the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice. its disclosure might prejudice The Commissioner of Police may identify any information provided to the court for the purposes of the review as confidential the Commissioner of Police, and information so identified is for the court's use only and is not to be disclosed to any other person, whether or not a party to the proceedings, or publicly disclosed in any way. the operations of The court may decide whether or not the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice. The decision of the court on an application for review under this section is final ..." Section 83, which is in Pt 4, Div 7 of the Act, limits ordinary judicial review under s 16 of the Supreme Court Act 1935 (WA) as follows: "(1) Except with the consent of the Parliamentary Inspector[138] a prerogative writ cannot be issued and an injunction or a declaratory 138 Established by Pt 13 of the Act. Crennan judgment cannot be given in respect of the performance of a function for the purposes of this Part and proceedings cannot be brought seeking such a writ, injunction, or judgment. Subsection (1) does not apply after the completion of the investigation that it was being sought to facilitate by performing the function." The ground upon which the Commissioner's decision to issue the notice was that the Commissioner could not have reasonably had the belief required by s 72(2) when issuing the notice. the appellant sought a review of In the proceedings before Blaxell J in the Supreme Court of Western Australia, the Commissioner relied on the provisions of s 76(2) and provided a redacted version of the affidavit (a complete copy of which was also provided to the Court) containing the information which the Commissioner took into consideration when making the decision to issue the fortification removal notice. The appellant only received the redacted version of the Commissioner's affidavit in which information identified by the Commissioner as confidential was blacked out. The balance of information in the affidavit identified 59 members of the appellant, all but one of whom the Commissioner alleged had criminal records, and included details of some 130 charges, with which the Commissioner alleged members or associates of the appellant had been charged. Of those charges, 17 were for Sched 1 offences. That information related to the second matter of which the Commissioner had to be satisfied under s 72(2)(b). This conveyed, in broad terms, some information which the Commissioner took into consideration when he issued the notice. It can be noted that the appellant did not take any issue with non-disclosure, by the Commissioner, of a police informant's name, which is covered by well-established rules139. In response to receiving only a redacted version of the affidavit, the appellant challenged the validity of s 76(2). Pursuant to s 43 of the Supreme Court Act 1935 (WA) two questions were referred to the Court of Appeal: Is section 76 of the Corruption and Crime Commission Act 2003 (WA) valid? and In the alternative, is sub section 76(2) of the Corruption and Crime Commission Act 2003 (WA) valid?" By a majority (Martin CJ and Steytler P; Wheeler JA dissenting) the Court of Appeal rejected the appellant's submission that s 76(2) of the Act so affected 139 Heydon, Cross on Evidence, 7th Aust ed (2004) at 887-888 [27130]. See also Evidence Act 1995 (Cth), s 130(4)(e). Crennan the institutional integrity, by detracting from the independence and impartiality of the Supreme Court, that it ceased to meet the constitutional requirements of Ch III of the Constitution. In its Notice of Appeal to this Court the appellant asks this Court to substitute "No" as the answer to question (b) referred to the Court of Appeal. It was accepted that questions of whether the whole of s 76 is invalid, or whether severance of s 76(2) would be possible, will only arise if s 76(2) is found to be invalid. The question The question in this appeal is whether s 76(2) of the Act is a valid exercise of the legislative power of the Western Australian Parliament. Invalidity was alleged on the basis that s 76(2) substantially impaired the institutional integrity of the Supreme Court of Western Australia contrary to requirements of Ch III of the Constitution as determined in Kable v Director of Public Prosecutions (NSW)140 ("Kable") and was incompatible with the Supreme Court's role under the Constitution as a potential repository of federal jurisdiction. In Forge v Australian Securities and Investments Commission141 ("Forge v ASIC") Gleeson CJ said of the principle in Kable: "… since the Constitution established an integrated court system, and contemplates the exercise of federal jurisdiction by State Supreme Courts, State legislation which purports to confer upon such a court a function which substantially impairs its institutional integrity, and which is therefore incompatible with its role as a repository of federal jurisdiction, is invalid." It was explained in Forge v ASIC that the principle established in Kable is founded on the constitutional description of State Supreme Courts in Ch III of the Constitution: "Supreme Court of [a] State" in respect of which the High Court exercises appellate jurisdiction (s 73(ii)), or a "court of a State" in which the Commonwealth Parliament invests federal jurisdiction (s 77(iii)). It exceeds the legislative power of a State to alter the constitution or character of a Supreme Court of a State so as to impair its institutional integrity, an important element of which is minimum requirements of independence and 140 (1996) 189 CLR 51. 141 (2006) 228 CLR 45 at 67 [40] per Gleeson CJ; see also Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 591 [15] per Gleeson CJ. Crennan impartiality because to do so would preclude that court from answering the constitutional description "Supreme Court of [a] State"142. While ss 73(ii) and 77(iii) do not identify minimum requirements of independence and impartiality, it is clear that courts as institutions forming part of Australia's integrated court system must have the "capacity to administer the common law system of adversarial trial"143. Unlike the legislation in Kable's case, the provisions in respect of fortifications do not involve the Supreme Court making any orders for any interference with personal liberty. Such interference as may be permitted under the Act is interference with property habitually used by persons reasonably suspected of being involved in organised crime and that interference is limited to requiring the removal of heavy fortifications from the property of such persons. The Act replaced the Criminal Investigation (Exceptional Powers) and Fortification Removal Act 2002 (WA) ("the 2002 Act"), substantially reproducing its provisions. On the Second Reading Speech in respect of the Bill for the 2002 Act, the Premier of Western Australia identified the mischief to be addressed and said144: "It has been recognised in Australia and many overseas countries that highly organised crime cannot be investigated and prosecuted by relying on ordinary police powers of investigation. Members may be aware that premises owned or used by criminal gangs are often heavily fortified. The effect of this fortification is to prevent the police from obtaining access to these premises. The result is that investigations are hindered because searches cannot be conducted or cannot be conducted in a timely manner. These heavily fortified premises become a safe haven for organised criminals and their activities. In order 142 Forge v ASIC (2006) 228 CLR 45 at 67 [41] per Gleeson CJ, 76 [63] and 86 [93] per Gummow, Hayne and Crennan JJ; see also 121 [192] per Kirby J, 138 [244]- [245] per Heydon J; North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 163 [29] per McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ; Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 617 143 Forge v ASIC (2006) 228 CLR 45 at 76 [64] per Gummow, Hayne and Crennan JJ. 144 Western Australia, Legislative Assembly, Parliamentary Debates, (Hansard), 6 November 2001 at 5038, 5041. Crennan to carry out successful investigations and obtain evidence, the police must be able to obtain entry to these premises. The Government recognise that occasionally this will require demolition of existing fortifications. The Bill sets out the process and circumstances in which these fortifications can be removed." Such matters put the legislation in context, which is important when questions of construction are raised145. The appellant's case In reliance upon the principle established in Kable and in support of a general submission that s 76(2) was "repugnant to the judicial process in a fundamental degree"146, the appellant contended that the procedure established by s 76(2), whereby information identified as confidential by the Commissioner could not be disclosed to an applicant for judicial review, constituted a denial of procedural fairness. That procedure was said to compromise the ability of the Supreme Court to ascertain the facts and to constitute a derogation from its constitutional obligation to act as a court operating in accordance with Ch III of the Constitution. Secondly, it was contended that the terms of s 76(2) vested the decision of what information may be disclosed to an applicant for review exclusively in the Commissioner. This was characterised as improper interference by the executive in the judicial process. Thirdly, the prohibition on disclosure of confidential information to the public was said to preclude the Court from giving proper reasons for judgment. Finally, it was contended that there were no safeguards in place which may have mitigated those aspects of the procedure said to impair the Supreme Court's institutional integrity. It was contended, alternatively, that the procedure under s 76(2) was incompatible with the Supreme Court's exercise of federal judicial power, in the sense described in Grollo v Palmer147 and Wilson v Minister for Aboriginal and Torres Strait Islander Affairs148, because the powers conferred on the Court were heavily constrained by the executive. 145 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408 per Brennan CJ, Dawson, Toohey and Gummow JJ. 146 Kable (1996) 189 CLR 51 at 132 per Gummow J. 147 (1995) 184 CLR 348. 148 (1996) 189 CLR 1. Crennan Section 76(2) and the role of the Commissioner The appellant's attack on s 76(2) was framed in terms of the principle of separation of powers and included reference to a statement in an Opinion of the Supreme Court of the United States in Mistretta v United States149: "The legitimacy of the Judicial Branch ultimately depends on its reputation for impartiality and nonpartisanship. That reputation may not be borrowed by the political Branches to cloak their work in the neutral colours of judicial action." The appellant's specific allegations that s 76(2) provides for improper interference by the executive in the judicial process of the Supreme Court depended on construing the words of s 76(2) as empowering the Commissioner to instruct or command the Supreme Court to carry out its review (s 76(1)) and its function (s 76(5)) on the basis of an unexaminable opinion of the Commissioner that disclosure of the information identified as confidential might prejudice his operations. The respondent's answer to this submission was that compliance with the condition which had to be satisfied to prevent disclosure, namely that the information might prejudice the operation of the Commissioner, was an issue of fact to be determined by the judge. That should be accepted. Section 76(1) requires that the information which the Commissioner took into consideration when issuing the notice must be placed before the Court on an application for review. Section 76(2) permits the Commissioner to identify any of the information placed before the Court pursuant to s 76(1) as "confidential". Thus the Commissioner makes a claim to have this information exempted from disclosure. Section 76(2) identifies a specific public interest, namely avoiding prejudice to the operations of the Commissioner, as the basis for that exemption from disclosure. There is nothing in s 76 which suggests that an applicant for judicial review is not able to contest matters of fact bearing on the question which the Court must determine under s 76(5), including the question of whether the information identified by the Commissioner as confidential should be exempted from disclosure. The condition in s 76(2) merely operates to identify a basis upon which the statutory exemption from disclosure, in the second part of s 76(2), will apply. 149 488 US 361 at 407 (1989). Crennan Section 76(2) does not expressly or impliedly dictate a procedure to be followed. Nor does it authorise the Commissioner, according to his opinion, to give directions to the Court, or to determine for the Court the satisfaction of the condition, or basis, for exemption from disclosure. The second part of s 76(2) will only operate to exempt information from disclosure if the judge is satisfied as to the condition or basis upon which the Commissioner's claim of confidentiality rests. It is for the judge to determine conclusively whether disclosure of the Commissioner. If the judge is not conclusively satisfied that disclosure might prejudice the operations of the Commissioner, the information will lose its confidential character, for the purposes of exemption from disclosure, even though the Commissioner's initial identification of the information as confidential was made properly, but erroneously. There is no difficulty in reconciling s 76(2) with constitutional principle. information might prejudice the operations of the Section 76 and procedural fairness In Kable, Gaudron J spoke of the power of indefinite detention, based on an opinion that a person is more likely than not to commit a serious act of violence in the future, as "the antithesis of the judicial process"150. Six members of this Court described what is involved in judicial process in Bass v Permanent Trustee Co Ltd151: "Judicial power involves the application of the relevant law to facts as found in proceedings conducted in accordance with the judicial process. And that requires that the parties be given an opportunity to present their evidence and to challenge the evidence led against them." (footnotes omitted) The setting in which s 76(2) is to be judged is the Supreme Court's role under s 76(1) and (5), and in any exemption of information from disclosure to an applicant for review. A relevant point is made in de Smith, Woolf & Jowell152: "Openness is a vital ingredient in the structuring of discretion and information is an important weapon in litigation about the lawful exercise of power." 150 (1996) 189 CLR 51 at 106. 151 (1999) 198 CLR 334 at 359 [56] per Gleeson CJ, Gaudron, McHugh, Gummow, 152 Judicial Review of Administrative Action, (1995), 5th ed at 61 [1-121]. Crennan In accordance with s 76(1) and (5) the Supreme Court is only required to decide whether or not "the Commissioner of Police could have reasonably had the belief required by section 72(2) when issuing the notice". The majority of the Court of Appeal correctly noted the limitations of the review153: "[The Supreme Court's] function is not that of deciding whether or not, at the time of the review, there are reasonable grounds for the formation of the belief referred to by s 72(2). Rather, its task is only that of determining whether, having regard to the submissions made by the applicant and to whatever information was taken into account by the Commissioner in forming his belief, the Commissioner could have reasonably had the required belief when issuing the notice: s 76(1)." That limited review is the context in which the Commissioner may make a claim, that information is confidential so as to exempt it from disclosure. The applicant for review does not canvass the merits of the Commissioner's decision to issue the fortification removal notice. The procedure for exemption has some similarity to a claim for public interest immunity, the common law exclusionary rule of evidence by which information is immune from disclosure in litigation, if disclosure would injure a State interest. interest immunity involve balancing Commonly, claims by a member of the executive to confidentiality or public the administration of justice and the disclosure of all relevant material against the need to exempt certain information from disclosure so as to avoid some particular injury or prejudice to a specified public interest154 such as national security, or as here, combating and reducing the incidence of organised crime (s 7A(a)). the public interest In ruling on a claim for public interest immunity, a court may look at information in documents which is not revealed to a party seeking them155, and a court may resolve a claim finally without one of the parties being shown certain material relied on for determination of a proceeding156. 153 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2007) 33 WAR 245 at 277 [110] per Steytler P (with whom Martin CJ generally agreed). (original emphasis) 154 Sankey v Whitlam (1978) 142 CLR 1; Alister v The Queen (1984) 154 CLR 404. See also Conway v Rimmer [1968] AC 910; Air Canada v Secretary of State for Trade [1983] 2 AC 394. 155 Sankey v Whitlam (1978) 142 CLR 1 at 46 per Gibbs ACJ, 110 per Aickin J. 156 Alister v The Queen (1984) 154 CLR 404 at 469-470 per Gibbs CJ, Wilson, Crennan Here, under statutory provisions permitting a claim not unlike a claim for public interest immunity, the Supreme Court, but not the appellant had produced to it, for inspection by it, all of the material relied on by the Commissioner. The appellant's particular complaints alleging a want of procedural fairness were that it did not have access to material adverse to it and the Court was deprived of the benefit of its submissions on such material. Parliament can validly legislate to exclude or modify the rules of procedural fairness provided there is "sufficient indication"157 that "they are excluded by plain words of necessary intendment"158. Whether the obligation to accord procedural fairness is satisfied will always depend on all the circumstances. For example, in a joint judgment of five members of this Court in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs159, it was recognised, by reference to Sankey v Whitlam160 and Alister v The Queen161, that courts "mould their procedures to accommodate what has become known as public The statutory modification of procedural fairness achieved by s 76(2) (including any effect on the giving of reasons) is indistinguishable from the modification of procedural fairness which can arise from the application of the principles of public interest immunity. Patent cases can raise special issues of confidentiality in personal, private or proprietary information attracting the equitable principles for protecting confidential information. Confidential information may only be provided to parties and legal advisers and published in reasons in a manner ensuring confidentiality163. 157 The Commissioner of Police v Tanos (1958) 98 CLR 383 at 396 per Dixon CJ and Webb J (Taylor J agreeing). 158 Annetts v McCann (1990) 170 CLR 596 at 598 per Mason CJ, Deane and McHugh JJ; Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 56 159 (2005) 225 CLR 88. 160 (1978) 142 CLR 1. 161 (1984) 154 CLR 404. 162 (2005) 225 CLR 88 at 98 [24] per Gleeson CJ, Gummow, Kirby, Hayne and 163 Aktiebolaget Hassle v Commissioner of Patents (No 2) (1989) 96 FLR 175. Crennan In circumstances where confidential material is part of the material before a court, but is not available to a party or cannot be published at large, a judge's reasons can be formulated in general terms so as to "convey an adequate account of the litigation and the reasons underlying the orders"164. There is no reason that approach could not be adopted in this case. It is not necessary for the determination of this appeal to decide whether the Commonwealth Parliament could validly enact legislation analogous to s 76(2). However, two examples of federal legislation bearing on the completeness of evidence in judicial proceedings can be noted. Section 130(1) of the Evidence Act 1995 (Cth) provides that a court may direct that information or a document not be adduced as evidence, if the information or document relates to matters of State and the public interest in admitting the information or document into evidence is "outweighed by the public interest in preserving secrecy or confidentiality". Section 130(4)(c) provides that information or a document may be taken to relate to "matters of state" if adducing it as evidence would "prejudice the prevention, investigation or prosecution of an offence". In a more specific context s 94 of the Patents Act 1952 (Cth), now repealed, provided that a prescribed court could order the extension of the term of a patent or order the grant of a new standard patent (s 94(1)) even though the patentee "does not present to the court a complete account of his receipts and expenditure as patentee if the court is nevertheless satisfied that the patentee has been inadequately remunerated by the patent" (s 94(2)). It was recognised that providing all relevant material could cause enormous expense and inconvenience165. Reference is made to these two examples of federal legislation only to illustrate that the availability and accessibility of all relevant evidence in judicial proceedings is not absolute. Safeguards Finally, in contending that the Act, particularly s 76(2), lacked safeguards which would obviate any modification to procedural fairness resulting from the application of s 76(2), the appellant drew attention to the provisions for a closed hearing and non-disclosure in the National Security Information (Criminal and 164 David Syme & Co Ltd v General Motors-Holden's Ltd [1984] 2 NSWLR 294 at 165 Re Montecatini's Patent (1973) 47 ALJR 161 at 169 per Gibbs J. Crennan Civil Proceedings) Act 2004 (Cth). Reference was also made to Charkaoui v Canada (Citizenship and Immigration)166, a decision of the Supreme Court of Canada, and to provisions in the United Kingdom167 which provided for employment of special counsel, separate from a party's legal representative, as a safeguard in certain contexts calling for an exercise of a discretion to balance national security considerations against procedural fairness. The fact that the requirements of procedural fairness may be satisfied differently in other situations, including those arising in different constitutional settings, does not mean that any modification to procedural fairness resulting from the application of s 76(2) constitutes a departure from the standards of independence and the abovementioned constitutional descriptions. impartiality necessary to meet Conclusions In providing for the exemption of certain information from disclosure, s 76(2) does not so affect the character of the Supreme Court of Western Australia that it does not satisfy the minimum requirements of independence from the executive, and impartiality, which are founded upon the constitutional description "Supreme Court of [a] State" in Ch III. Nor does s 76(2) create any incompatibility with the Supreme Court's role under the Constitution as a potential repository of federal jurisdiction. The decision of the majority of the Court of Appeal was correct. For the reasons set out above, the challenge to the validity of s 76(2) fails, and question (b) referred to the Court of Appeal enquiring whether s 76(2) is valid should be answered "Yes", rendering it unnecessary to answer question (a). Orders I agree with Gummow, Hayne, Heydon and Kiefel JJ that the appeal should be dismissed. The appellant must pay the respondent's costs. 166 [2007] 1 SCR 350. 167 Section 6(1) of the Special Immigration Appeals Commission Act 1997 (UK) and r 35 of the Special Immigration Appeals Commission (Procedure) Rules 2003.
HIGH COURT OF AUSTRALIA GLENCORE INTERNATIONAL AG & ORS PLAINTIFFS AND COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA & ORS DEFENDANTS Glencore International AG v Commissioner of Taxation [2019] HCA 26 14 August 2019 ORDER The demurrer be upheld. The proceeding be dismissed with costs. Representation I M Jackman SC with T L Phillips for the plaintiffs (instructed by King & Wood Mallesons) S P Donaghue QC, Solicitor-General of the Commonwealth, with M J O'Meara for the defendants (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Glencore International AG v Commissioner of Taxation Privilege – Legal professional privilege – Where documents identified by plaintiffs as having been created by law practice for sole or dominant purpose of provision of legal advice to plaintiffs – Where privileged documents stolen from electronic file management system of law practice and disseminated – Where documents obtained by defendants – Where defendants refused to return documents to plaintiffs and provide undertaking not to refer to or rely upon documents – Where plaintiffs sought injunctive relief in equity's auxiliary jurisdiction solely on basis of legal professional privilege – Where plaintiffs did not seek injunctive relief on basis of confidentiality or other area of law – Where defendants demurred on basis that no cause of action disclosed – Whether legal professional privilege operates only as immunity or is also actionable legal right – Whether policy considerations justify creation of new actionable right in respect of documents subject to legal professional privilege. Words and phrases – "actionable legal right", "basis for relief", "breach of confidence", "cause of action", "common law right", "confidentiality", law", "immunity", "injunction", "legal professional "development of privilege", "policy of the law", "public interest", "remedy". the KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ. The plaintiffs are companies within the global Glencore plc group ("the Glencore group"). In these proceedings, brought in the original jurisdiction of this Court, they seek an injunction restraining the defendants – the Commissioner, the Second Commissioner and the Deputy Commissioner of Taxation – and any other officer of the Australian Taxation Office from making any use of documents described as "the Glencore documents" or any information contained in or which may be derived from those documents. The plaintiffs also seek an order for the delivery up of the Glencore documents. In the plaintiffs' amended statement of claim the Glencore documents are identified as documents which were created for the sole or dominant purpose of the provision by Appleby (Bermuda) Limited ("Appleby"), an incorporated law practice in Bermuda, of legal advice to the plaintiffs with respect to the corporate restructure of Australian entities within the Glencore group. The Managing Partner of Appleby says that the Glencore documents are amongst documents colloquially described as the "Paradise Papers" which were stolen from Appleby's electronic file management systems and provided to the International Consortium of Investigative Journalists. It may be assumed that the documents have been further disseminated. The existence and content of the Paradise Papers has received global media coverage. The plaintiffs say that the defendants have obtained copies of the Paradise Papers. The plaintiffs have asserted that the Glencore documents are subject to legal professional privilege and have asked the defendants to return them and to provide an undertaking that they will not be referred to or relied upon. The defendants have not acceded to those requests. The defendants demur to the plaintiffs' amended statement of claim. The principal ground for the demurrer is that no cause of action is disclosed by which the plaintiffs are entitled to the relief sought. Alternatively, the defendants contend that they are entitled and obliged to retain and use the documents in question by reason of and for the purposes of s 166 of the Income Tax Assessment Act 1936 (Cth) ("the ITAA"). That section relevantly provides that the Commissioner must make an assessment of a taxpayer's taxable income from the taxpayer's returns "and from any other information in the Commissioner's possession". There is no issue about the Glencore documents being the subject of legal professional privilege. Decisions of this Court hold that documents which are Bell Nettle Gordon Edelman subject to legal professional privilege are exempt from production by court process or statutory compulsion1. A declaration to this effect would not assist the plaintiffs. The Glencore documents are in the possession of the defendants and may be used in connection with the exercise of their statutory powers unless the plaintiffs are able to identify a juridical basis on which the Court can restrain that use. It is well known that equity will restrain an apprehended breach of confidential information and will do so with respect to documents which are the subject of legal professional privilege and which are confidential2. Equity will restrain third parties if their conscience is relevantly affected3. There may be difficulties for the plaintiffs in meeting the requirements for such relief, given that the Glencore documents are in the public domain and there being no allegation concerning the defendants' conduct or knowledge. The defendants point to s 166 of the ITAA as a bar to relief in this respect. It is not necessary to give this question further consideration. The plaintiffs do not seek an injunction on the ground of confidentiality. They do not seek to expand any area of the law such as any tort of unjustified invasion of privacy4. They claim that legal professional privilege is itself sufficient for the grant of the injunction sought. 1 Grant v Downs (1976) 135 CLR 674; [1976] HCA 63; Baker v Campbell (1983) 153 CLR 52; [1983] HCA 39; Attorney-General (NT) v Maurice (1986) 161 CLR 475; [1986] HCA 80; Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121; [1995] HCA 33; Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501; [1997] HCA 3; Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543; [2002] HCA 49. 2 Lord Ashburton v Pape [1913] 2 Ch 469. Johns v Australian Securities Commission (1993) 178 CLR 408; [1993] HCA 56; Lord Ashburton v Pape [1913] 2 Ch 469. 4 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199; [2001] HCA 63. Bell Nettle Gordon Edelman The plaintiffs' case The plaintiffs take as their starting point that legal professional privilege has been recognised by decisions of this Court as a fundamental common law right5. They seek an injunction in equity's auxiliary jurisdiction and accept that this requires that they have an actionable legal right. In Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission6, legal professional privilege was described as "an important common law immunity". This description may be thought to detract somewhat from the plaintiffs' claim to a legal right which entitles them to an injunction. But the plaintiffs contend that those words were expressed tentatively and are explicable by reference to the facts of that case. They contend that Daniels Corporation is not to be understood as confining the scope of the privilege, and that no decision of this Court has held that the privilege operates only as an immunity. The plaintiffs submit that the scope of the privilege should reflect the policy of the law upon which it is based. The rationale for legal professional privilege is the furtherance of the administration of justice through the fostering of trust and candour in the relationship between lawyer and client. It should be understood to have its basis in the rule of law7. The recognition of an actionable right to restrain the use of and recover privileged documents advances this policy, the plaintiffs contend. 5 Baker v Campbell (1983) 153 CLR 52; Goldberg v Ng (1995) 185 CLR 83; [1995] HCA 39; Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121; Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543. (2002) 213 CLR 543 at 553 [11] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; see also at 552-553 [9]-[10] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, 563 [44] per McHugh J ("Daniels Corporation"). 7 Three Rivers District Council v Governor and Company of the Bank of England [No 6] [2005] 1 AC 610 at 649-650 [34] per Lord Scott of Foscote, referring to Zuckerman, Civil Procedure (2003) at [15.8]-[15.10]. Bell Nettle Gordon Edelman The plaintiffs contend that the provision of a remedy may also be seen as necessary because it is unsound for the privilege to be recognised as a fundamental right but for confidentiality to provide the only basis for its enforcement. If Lord Ashburton v Pape8 is to be understood to hold that an injunction will be granted on the basis that documents are confidential rather than privileged, there is a gap in the law. The plaintiffs submit that decisions of courts in other common law jurisdictions have recognised the existence of general law rights which may support an injunction9. They reinforce the recognition by the law of the importance of protecting privileged communications obtained by impropriety. The demurrer must be upheld The plaintiffs' argument cannot be accepted. Fundamentally it rests upon an incorrect premise, namely that legal professional privilege is a legal right which is capable of being enforced, which is to say that it may found a cause of action10. The privilege is only an immunity from the exercise of powers which would otherwise compel the disclosure of privileged communications, as Daniels Corporation holds. It is not sufficient to warrant a new remedy to say that the public interest which supports the privilege is furthered because communications between client and lawyer will be perceived to be even more secure. The development of the law can only proceed from settled principles and be conformable with them11. The plaintiffs' case seeks to do more than that. It seeks to transform the nature of the privilege from an immunity into an ill-defined cause of action which may be brought against anyone with respect to documents which may be in the public domain. 9 Lachaux v Independent Print Ltd [2017] EWCA Civ 1327; Wee Shuo Woon v HT SRL [2017] 2 SLR 94. 10 Heydon, Leeming and Turner, Meagher, Gummow & Lehane's Equity: Doctrines & Remedies, 5th ed (2015) at [21-025]-[21-035]. 11 Breen v Williams (1996) 186 CLR 71 at 99 per Dawson and Toohey JJ; [1996] HCA 57. Bell Nettle Gordon Edelman The demurrer should be upheld on the first ground. There is no need to consider the alternative ground concerning s 166 of the ITAA. The historical operation of the privilege Holdsworth12 regarded the privilege as belonging to the same order of ideas as the privilege to refuse to answer questions the answer to which could expose a witness to injury. The view of Holdsworth and of Wigmore13 that legal professional privilege arose as a response to the Statute of Elizabeth 1562-156314 appears now to be contested15. It is suggested that it may have arisen gradually as part of the larger body of law relating to testimonial compulsion16. Whatever its exact origin, there does not seem to be any dispute that it was a response to the exercise of powers by the State to compel disclosure of confidential communications between lawyer and client17. 12 Holdsworth, A History of English Law, 3rd ed (1944), vol 9 at 202. 13 Brereton, "Legal Professional Privilege", in Gleeson, Watson and Peden (eds), Historical Foundations of Australian Law (2013), vol 2, 127 at 130, referring to Wigmore, Evidence in Trials at Common Law, McNaughton rev (1961), vol 8, §2290 and Holdsworth, A History of English Law, 3rd ed (1944), vol 9 at 201. See also Baker v Campbell (1983) 153 CLR 52 at 60 per Gibbs CJ, 93-94 per Wilson J, 113-114 per Deane J, 126-127 per Dawson J. 14 5 Eliz c 9. 15 Auburn, Legal Professional Privilege: Law and Theory (2000) at 2-8; Brereton, "Legal Professional Privilege", in Gleeson, Watson and Peden (eds), Historical Foundations of Australian Law (2013), vol 2, 127 at 130. 16 Auburn, Legal Professional Privilege: Law and Theory (2000) at 7-8. 17 Brereton, "Legal Professional Privilege", in Gleeson, Watson and Peden (eds), Historical Foundations of Australian Law (2013), vol 2, 127 at 128-129; see also Auburn, Legal Professional Privilege: Law and Theory (2000) at 7. Bell Nettle Gordon Edelman The description of the doctrine as a privilege did not emerge until some hundreds of years after cases concerning it were first decided18. Nevertheless, the nature of the privilege could generally be deduced from its operation. It permitted a witness not to answer questions in court; it provided a lawyer or client with an excuse not to comply with court processes and protected them from liability for contempt19. The privilege was granted by the law to render a person immune from powers of compulsion. When it applied, laws or rules which contained such powers might not be effective. That is to say, the client or lawyer was immunised from such powers. In Australia, in the late twentieth century, questions of legal professional privilege commonly arose in the course of litigation and its boundaries were redefined, as they had been over preceding centuries. In Grant v Downs20, the conditions upon which objection could be taken to the production of documents brought into existence for the purpose of advice or litigation were stated, although they were subsequently modified21. Attorney-General (NT) v Maurice22 also concerned the privilege from production of documents in the course of discovery. In Carter v Northmore Hale Davy & Leake23 it was held that persons 18 Brereton, "Legal Professional Privilege", in Gleeson, Watson and Peden (eds), Historical Foundations of Australian Law (2013), vol 2, 127 at 132; and see Bulstrod v Letchmere (1676) 2 Freeman 5 [22 ER 1019], referred to in Brereton, "Legal Professional Privilege", in Gleeson, Watson and Peden (eds), Historical Foundations of Australian Law (2013), vol 2, 127 at 133; and Wilson v Rastall (1792) 4 TR 753 [100 ER 1283], referred to in R v Derby Magistrates' Court; Ex parte B [1996] AC 487 at 504 per Lord Taylor of Gosforth. 19 Brereton, "Legal Professional Privilege", in Gleeson, Watson and Peden (eds), Historical Foundations of Australian Law (2013), vol 2, 127 at 133. 20 (1976) 135 CLR 674 at 687-688 per Stephen, Mason and Murphy JJ; see also Goldberg v Ng (1995) 185 CLR 83. 21 Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 71-73 [56]-[61] per Gleeson CJ, Gaudron and Gummow JJ, 107 [173] per Callinan J; [1999] HCA 67. 22 (1986) 161 CLR 475. 23 (1995) 183 CLR 121. Bell Nettle Gordon Edelman and entities to whom a subpoena had been directed to produce documents said to be relevant to an accused's defence could not be compelled to produce those documents because they were subject to the privilege. At the same time there was a proliferation of statutes containing compulsive powers with respect to information. In Baker v Campbell24 and in Commissioner of Australian Federal Police v Propend Finance Pty Ltd25 the privilege was extended beyond curial processes to search warrants authorised by statute. And in Daniels Corporation26 it was declared that a provision of the Trade Practices Act 1974 (Cth) which gave power to require the production of documents did not abrogate legal professional privilege. The privilege and admissibility The cases do not suggest as possible any further relief beyond that which ensured that privileged documents need not be produced. Nor do they suggest that effect was being given to an enforceable legal right. Where documents were withheld from disclosure no question of restraining persons from accessing them could arise. If they had come into the possession of another person in circumstances which raised an equity, an injunction could be granted in order to protect their confidential nature27. It is true that at the time Calcraft v Guest28 was decided the law did not concern itself with the source of a document when it was tendered in evidence29 24 (1983) 153 CLR 52. 25 (1997) 188 CLR 501. 26 (2002) 213 CLR 543. 27 Lord Ashburton v Pape [1913] 2 Ch 469. 29 Goddard v Nationwide Building Society [1987] QB 670; Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 566 per Gummow J, referring to Zuckerman, "Legal Professional Privilege and the Ascertainment of Truth" (1990) 53 Modern Law Review 381 at 383. Bell Nettle Gordon Edelman and it permitted that course even when a document was privileged. As the parties point out, that decision pre-dates decisions of this Court30 and provisions of the Evidence Act 1995 (Cth)31 which deal with questions of admissibility, including in circumstances where documents are obtained by improper means. In any event the plaintiffs' case does not depend on questions of admissibility. It is therefore unnecessary to further consider that case or whether it can properly be reconciled with Lord Ashburton v Pape. An immunity Legal professional privilege has been described as a right which is fundamental to persons and to our legal system32. It has also been described as "a practical guarantee of fundamental, constitutional or human rights"33. Such descriptions point up the importance of the privilege. They serve to show that it is not merely an aspect of curial procedure or a mere rule of evidence but a substantive right founded upon a matter of public interest34. The same distinction has been drawn in New Zealand35 and the United Kingdom36. What cannot be discerned from these cases is that the "right" spoken of in connection with the privilege is an actionable right. If one asks what this "right" 30 Bunning v Cross (1978) 141 CLR 54; [1978] HCA 22. 31 Sections 118, 119, 138. 32 See Baker v Campbell (1983) 153 CLR 52 at 64 per Gibbs CJ, 106 per Brennan J, 113 per Deane J, 122 per Dawson J. 33 A M & S Europe Ltd v Commission of the European Communities [1983] QB 878 at 941, referred to in Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 490 34 Baker v Campbell (1983) 153 CLR 52. 35 Commissioner of Inland Revenue v West-Walker [1954] NZLR 191 at 206-207 per 36 R (Morgan Grenfell & Co Ltd) v Special Commissioner of Income Tax [2003] 1 AC 563 at 612 [31] per Lord Hoffmann. Bell Nettle Gordon Edelman gives to a person, the answer could be stated as "a right to resist the compulsory disclosure of information" or "the right to decline to disclose or to allow to be disclosed the confidential communication or document in question", as the Privy Council37 and the House of Lords38 respectively have held. So understood it is a freedom from the exercise of legal power or control, which is to say an immunity39, and that is what Daniels Corporation held its true character to be. In Daniels Corporation40 Gleeson CJ, Gaudron, Gummow and Hayne JJ, having observed that it is now settled that legal professional privilege is a rule of substantive law and not merely a rule of evidence, made the statement referred to earlier in these reasons that: "It is an important common law right or, perhaps more accurately, an important common law immunity." McHugh J41 likewise described it as "a person's immunity from compulsion to produce documents that evidence confidential communications about legal matters" between lawyers and clients. Contrary to the plaintiffs' submissions, there is nothing tentative in their Honours' characterisation of the privilege as an immunity provided by the common law. In the manner stated it is a considered correction of a possible misunderstanding arising from the description of it as a common law right. There can be little doubt that the joint judgment was drawing a clear distinction, for the context of the statement was the application of the principle of legality to the construction of statutes which may have the effect of abrogating "important 37 B v Auckland District Law Society [2003] 2 AC 736 at 761 [67]. 38 Three Rivers District Council v Governor and Company of the Bank of England [No 6] [2005] 1 AC 610 at 646 [26] per Lord Scott of Foscote. 39 Hohfeld, "Some Fundamental Legal Conceptions as Applied in Judicial Reasoning" (1913) 23 Yale Law Journal 16; Hohfeld, "Fundamental Legal Conceptions as Applied in Judicial Reasoning" (1917) 26 Yale Law Journal 710. 40 (2002) 213 CLR 543 at 552-553 [9]-[11]. 41 Daniels Corporation (2002) 213 CLR 543 at 563 [44]. Bell Nettle Gordon Edelman common characterisation of the privilege as an immunity is consistent with its history. rights, privileges and immunities"42. Their Honours' law The statements in Daniels Corporation accord with what Gummow J had said in Propend43. His Honour described legal professional privilege as "a bar to compulsory process for the obtaining of evidence". In his Honour's view, the privilege is "not to be characterised as a rule of law conferring individual rights, breach of which gives rise to an action on the case for damages, or an apprehended or continued breach of which may be restrained by injunction". And they accord with the view expressed by Brennan J in Carter44, that the justification for the privilege is not to be found in the enforcement of some private right, but rather in the public interest. The policy of the privilege – the public interest The rationale for the rule was stated in Grant v Downs45. It is that the rule promotes the public interest because it "assists and enhances the administration of justice by facilitating the representation of clients by legal advisers". By keeping secret their communications, the client is encouraged to retain a lawyer and to make full and frank disclosure of all relevant circumstances to the lawyer. This would appear to accord with the explanation given by Blackstone46 and, later, in the nineteenth century47. A similar rationale for the privilege has been 42 Daniels Corporation (2002) 213 CLR 543 at 553 [11] per Gleeson CJ, Gaudron, 43 Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 565, 566. 44 Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121 at 127. 45 (1976) 135 CLR 674 at 685 per Stephen, Mason and Murphy JJ; see also Attorney- General (NT) v Maurice (1986) 161 CLR 475 at 487 per Mason and Brennan JJ. 46 Blackstone, Commentaries on the Laws of England (1768), bk 3 at 370. 47 See R v Derby Magistrates' Court; Ex parte B [1996] AC 487 at 505 per Lord Bell Nettle Gordon Edelman accepted by the Privy Council48 and the House of Lords49 where the descriptor "the rule of law rationale" was accepted. Common law courts are not alone in their concern to protect the confidentiality of lawyer-client communications. In A M & S Europe Ltd v Commission of the European Communities50, the European Court of Justice noted a submission that the protection of legal confidence is a characteristic function of democratic systems and observed that all member states afford some protection to confidential relations between lawyer and client. But of course the manner and extent of that protection may differ. It was recognised in Grant v Downs that there was another, more general, public interest which legal professional privilege did not promote. That public interest lies in the fair conduct of litigation, which requires that all relevant documentary evidence be available. But the public interest which supports the privilege is paramount to the more general public interest51. In the provision of the privilege the law has struck the balance between two competing public interests52. Consequently, once the privilege is found to exist, no more is 48 B v Auckland District Law Society [2003] 2 AC 736 at 754 [37]. 49 Three Rivers District Council v Governor and Company of the Bank of England [No 6] [2005] 1 AC 610 at 649-650 [34] per Lord Scott of Foscote. 50 [1983] QB 878 at 941, 949-950. 51 Grant v Downs (1976) 135 CLR 674 at 685 per Stephen, Mason and Murphy JJ. 52 Waterford v The Commonwealth (1987) 163 CLR 54 at 64-65 per Mason and Wilson JJ; [1987] HCA 25; Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121 at 126-127 per Brennan J, 161 per McHugh J; Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 563-564 per Gummow J; see also R (Morgan Grenfell & Co Ltd) v Special Commissioner of Income Tax [2003] 1 AC 563 at 615 [43] per Lord Hobhouse of Woodborough; ISTIL Group Inc v Zahoor [2003] 2 All ER 252 at 273 [93] per Lawrence Collins J; Three Rivers District Council v Governor and Company of the Bank of England [No 6] [2005] 1 AC 610 at 646 [25] per Lord Scott of Foscote; Wee Shuo Woon v HT SRL [2017] 2 SLR 94 at 114 [62]. Bell Nettle Gordon Edelman required for effect to be given to it. In that sense it may be described as absolute53. The paramountcy afforded to the public interest which the privilege supports can have serious consequences. By way of example, an accused person can be denied access to documents which might assist his or her defence54. Because of the significance of the effect of the privilege on the conduct of litigation, and the other considerations identified in Grant v Downs55, it was there said that the privilege "should be confined within strict limits". That note of caution was to be repeated in subsequent cases56. Other relief? In striking the balance between the two competing public interests, the law was not concerned to further a client's personal interest in preventing the use which might be made by others of the client's communications if they obtained them. In providing an immunity, the law's purpose was to enhance the administration of justice. And in settling the conditions which must be present for the privilege to operate, it defined the boundaries of the privilege. It is the policy of the law that the public interest in the administration of justice is sufficiently secured by the grant of an immunity from disclosure. That has been the policy of the law for a very long time. Grant v Downs57 gave examples of difficulties which would arise in litigation if the balance struck by the privilege was not maintained as such. What was said in Grant v Downs and in later cases strongly implies that there is unlikely to be a warrant for providing anything more than an immunity from disclosure. 53 Goddard v Nationwide Building Society [1987] QB 670 at 685 per Nourse LJ. 54 Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121. 55 (1976) 135 CLR 674 at 685 per Stephen, Mason and Murphy JJ. 56 Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 487 per Mason and Brennan JJ; Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121 at 127 per Brennan J, 145, 157 per Toohey J. 57 (1976) 135 CLR 674 at 685-686 per Stephen, Mason and Murphy JJ. Bell Nettle Gordon Edelman The relief sought by the plaintiffs points to further difficulties. Some were mentioned earlier in these reasons: the nature of the cause of action which is to found the relief, and the fact that the information the subject of the claimed privilege is now in the public domain. In the latter respect the circumstances of this case identify a particular problem were an injunction to be granted. It is that the defendants would be required to assess Australian entities within the Glencore group to income tax on a basis which may be known to bear no real relationship to the true facts. On the present state of the law, once privileged communications have been disclosed, resort must be had to equity for protection respecting the use of that material. Although the policy upon which legal professional privilege is founded is not irrelevant to the exercise of that jurisdiction, the juridical basis for relief in equity is confidentiality58. The plaintiffs' contention that Lord Ashburton v Pape59 might be understood not to confine actions for the recovery of privileged material to situations where there may be a breach of confidence has no substance. It is true that there has been discussion about the differences in reporting of a passage in that case60, but the difference concerns whether the injunction made is intended to prevent the privileged material being adduced in future proceedings. Depending upon the reporting, Lord Ashburton v Pape may be read as departing from what was held in Calcraft v Guest61. But the difference in reporting does not affect the basis upon which the injunction was granted, namely the confidentiality of the privileged material. That was what was said in that case62 ("You shall not produce these documents which you have acquired from the plaintiff surreptitiously, or from his solicitor, who plainly stood to him in a 58 B v Auckland District Law Society [2003] 2 AC 736 at 762 [71]. 60 Goddard v Nationwide Building Society [1987] QB 670 at 679-680 per May LJ, referring to Lord Ashburton v Pape [1913] 2 Ch 469 at 473 per Cozens-Hardy MR; (1913) 109 LT 381 at 382; (1913) 82 LJ Ch 527 at 529. 62 Lord Ashburton v Pape [1913] 2 Ch 469 at 473 per Cozens-Hardy MR. Bell Nettle Gordon Edelman confidential relation") and that is how that decision has always been understood63. The plaintiffs seek to draw from the decision of this Court in Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd64 a general approach with respect to privileged documents, one which does not necessitate recourse to equity for an injunction based on breach of confidence. In that case documents were mistakenly provided to the other parties' solicitors in the course of discovery and the solicitors refused to return them. The Court held that it was not necessary for the holder of the privilege to seek an injunction because the court's case management powers were sufficient to make the necessary orders. Contrary to what the plaintiffs contend, the case does not stand for any broader proposition which would allow the privilege to be asserted in order for relief in the nature of an injunction to be granted. The plaintiffs' submission that common law courts elsewhere have granted injunctions on a basis other than breach of confidential information is incorrect. The plaintiffs refer in this regard to Lachaux v Independent Print Ltd65 and Wee Shuo Woon v HT SRL66. Each of these cases concerned whether there was a loss of the necessary quality of confidentiality to found an injunction. In Lachaux, the Court of Appeal upheld the trial judge's decision that the documents in question remained confidential despite the wife's evidence that they had been provided to media outlets67. It is notable that the trial judge applied the law as 63 Goddard v Nationwide Building Society [1987] QB 670 at 679-680 per May LJ; Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 565 per Gummow J; ISTIL Group Inc v Zahoor [2003] 2 All ER 252 at 269 [74] per Lawrence Collins J; cf Richards v Kadian by his Tutor Kadian (2005) 64 NSWLR 204 at 224 [83] per Beazley JA. 64 (2013) 250 CLR 303; [2013] HCA 46. 65 [2017] EWCA Civ 1327. 66 [2017] 2 SLR 94. 67 Lachaux v Independent Print Ltd [2017] EWCA Civ 1327. Bell Nettle Gordon Edelman stated by Lawrence Collins J in ISTIL Group Inc v Zahoor68. His Honour69 accepted the statements in ISTIL Group Inc v Zahoor which indicated that the Court of Appeal in Lord Ashburton v Pape was applying the law of confidentiality in order to prevent disclosure of documents which would otherwise have been privileged and which remained confidential. Whether the court should intervene where the document had been seen by others depended upon the circumstances70. That is to say, it was a question of fact and of discretion in each case. Wee Shuo Woon71 concerned emails containing privileged information which were hacked and then uploaded onto the internet. The appellant accessed them and sought to rely upon them in defending the respondent's claim against him. Accepting that information which was in the public domain has lost its confidential character, the Court of Appeal of Singapore nevertheless made orders on the basis that the documents retained that character. It held that the mere fact that information had been made technically accessible to the public at large did not affect this. The emails were only potentially accessible and contained only a minute portion of the data pilfered72. The appellant must have known they were confidential and privileged when he worked his way through the mass of hacked materials to locate the emails in question73. In no way do these cases support the notion that common law courts elsewhere are granting injunctions with respect to privileged material on the basis only of the wrongfulness associated with its taking. Certainly, it is necessary for an equity to arise that the person to be restrained must have an obligation of 68 [2003] 2 All ER 252. 69 Lachaux v Independent Print Ltd [2015] EWHC 3677 (QB) at [17]-[18]. 70 ISTIL Group Inc v Zahoor [2003] 2 All ER 252 at 269 [74] per Lawrence Collins J. 71 Wee Shuo Woon v HT SRL [2017] 2 SLR 94. 72 Wee Shuo Woon v HT SRL [2017] 2 SLR 94 at 108 [41]. 73 Wee Shuo Woon v HT SRL [2017] 2 SLR 94 at 108 [40]-[43], 111 [53]. Bell Nettle Gordon Edelman conscience74, but the basis for an injunction is the need to protect the confidentiality of the privileged document. The plaintiffs' case for the grant of relief on a basis other than confidentiality is simply this: that any furtherance of the public interest which supports the privilege is sufficient to warrant the creation of a new, actionable right respecting privileged documents. This is not how the common law develops. The law develops by applying settled principles to new circumstances, by reasoning from settled principles to new conclusions, or determining that a category is not closed75. Even then the law as developed must cohere with the body of law to which it relates. Policy considerations may influence the development of the law but only where that development is available having regard to the state of settled principles. Policy considerations cannot justify an abrupt change which abrogates principle in favour of a result seen to be desirable in a particular case76. In the absence of further facts it is not possible to say whether the plaintiffs are without any possibility of a remedy. But if there is a gap in the law, legal professional privilege is not the area which might be developed in order to provide the remedy sought. Orders The demurrer should be upheld and the plaintiffs' proceeding should be dismissed with costs. 74 Johns v Australian Securities Commission (1993) 178 CLR 408 at 427-428 per Brennan J, 459-460 per Gaudron J. 75 PGA v The Queen (2012) 245 CLR 355 at 373 [29] per French CJ, Gummow, Hayne, Crennan and Kiefel JJ; [2012] HCA 21, referring to Dixon, "Concerning Judicial Method" (1956) 29 Australian Law Journal 468 at 472. 76 Breen v Williams (1996) 186 CLR 71 at 99 per Dawson and Toohey JJ.
HIGH COURT OF AUSTRALIA AND THE QUEEN APPELLANT RESPONDENT [2016] HCA 17 4 May 2016 ORDER Appeal dismissed. On appeal from the Supreme Court of New South Wales Representation P M Wass SC with G E L Huxley for the appellant (instructed by Legal Aid Commission of NSW) J H Pickering SC with H Baker for the respondent (instructed by Solicitor for Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Sentencing – Manslaughter – Excessive self-defence – Where deceased a police officer – Where appellant taken to have shot deceased in honest but mistaken belief that deceased was person posing as police officer with intent to rob appellant – Whether sentencing judge erred in assessment of objective gravity of offence by taking into account absence of circumstance which if present would render subject offence a different offence – Relevance of R v De Simoni (1981) 147 CLR 383. Criminal law – Sentencing – Totality principle – Where appellant convicted of manslaughter and wounding with intent to cause grievous bodily harm – Whether open to sentencing judge to impose wholly concurrent sentences – Whether appellate court erred in partially accumulating sentences – Whether sentence imposed manifestly inadequate. Words and phrases – "accumulation", "concurrency", "De Simoni principle", "manifestly inadequate", "objective gravity", "totality". Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A(a), 21A(1). BELL AND KEANE JJ. This appeal raises two issues concerning the application of common law principles governing the sentencing of offenders. The first issue is whether the principle enunciated in R v De Simoni1 applies to preclude a sentencing judge from taking into account favourably to the offender the absence of a factor which, had it been present, would have rendered the offender liable for a more serious offence. The second issue concerns the scope of the sentencing judge's discretion to impose wholly concurrent sentences for offences that are the product of the same act. This is an aspect of the application of the principle referred to as totality in sentencing. The issues arise in the context of sentencing under the Crimes (Sentencing Procedure) Act 1999 (NSW) ("the Sentencing Act"), which, relevantly, preserves the application of both principles2. The procedural history On 19 July 2012, the appellant pleaded guilty in the Supreme Court of New South Wales to the manslaughter of Constable William Crews3 and to wounding Constable Crews with intent to cause grievous bodily harm to him4. Manslaughter and wounding with intent to cause grievous bodily harm are offences that are each subject to a maximum penalty of imprisonment for 25 years5. A standard non-parole period of seven years is prescribed for the wounding offence6. The sentencing judge (Fullerton J) took into account a further offence in sentencing him for manslaughter7. This was the appellant's (1981) 147 CLR 383; [1981] HCA 31. 2 Sentencing Act, s 21A(1). 3 Crimes Act 1900 (NSW) ("the Crimes Act"), s 18(1)(b). 4 Crimes Act, s 33(1)(a). 5 Crimes Act, ss 24, 33(1). 6 Sentencing Act, s 54A, Table item 4. 7 Section 33(2) of the Sentencing Act provides that a sentencing court may take a further offence into account in dealing with the offender for the principal offence if the offender admits guilt to the further offence and indicates that the offender wants the court to take the further offence into account in dealing with the offender for the principal offence and, in all of the circumstances, the court considers it appropriate to do so. The offence taken into account was charged under s 7(1) of the Firearms Act 1996 (NSW). Bell unlawful possession of the firearm that was used in the commission of the wounding offence. On 15 March 2013, the appellant was sentenced to a term of nine years and six months' imprisonment with a non-parole period of seven years for the manslaughter offence, and to a concurrent term of six years and three months' imprisonment with a non-parole period of four years and nine months for the wounding offence8. The sentences commenced on 8 September 2010. The sentence for the manslaughter offence was expressed to expire on 7 March 2020. The first date on which the appellant was eligible for release on parole was 7 September 2017. The Director of Public Prosecutions ("the Director") appealed against the sentences to the Court of Criminal Appeal of the Supreme Court of New South Wales (Beazley P, Johnson and RA Hulme JJ)9. The Director's appeal was brought on four grounds10. The first ground contended that the sentencing judge erred in assessing the objective seriousness of the manslaughter offence by taking into account that the appellant did not know that the deceased was a police officer when, if he had known that fact, he would have been liable to conviction for murder. The Court of Criminal Appeal upheld this ground and in so doing referred to the principle in De Simoni11. The second ground contended error in the failure to impose a sentence consonant with the sentencing judge's assessment of the objective seriousness of the wounding offence12. The Court of Criminal Appeal treated this ground as a particular of that each sentence was manifestly inadequate13. The third ground contended error in the determination that the appellant's overall criminality could be comprehended by the sentence for manslaughter14. This ground was upheld15, as was the fourth the fourth ground, which contended 8 R v Nguyen [2013] NSWSC 197 at [72]. 9 Criminal Appeal Act 1912 (NSW), s 5D. 10 R v Nguyen (2013) 234 A Crim R 324 at 327 [7]. 11 R v Nguyen (2013) 234 A Crim R 324 at 335 [50]-[52], citing (1981) 147 CLR 383. 12 R v Nguyen (2013) 234 A Crim R 324 at 336 [56]. 13 R v Nguyen (2013) 234 A Crim R 324 at 338 [70]. 14 R v Nguyen (2013) 234 A Crim R 324 at 339 [75]. 15 R v Nguyen (2013) 234 A Crim R 324 at 340 [84]. Bell ground16. The Court of Criminal Appeal was satisfied that the sentence imposed for each offence was manifestly inadequate and that there was no discretionary basis for declining to intervene. The Court of Criminal Appeal quashed the sentences imposed in the Supreme Court and, in their place, sentenced the appellant to a term of 16 years and two months' imprisonment with a non-parole period of 12 years for the manslaughter offence, and a term of eight years and one month's imprisonment with a non-parole period of six years for the wounding offence17. The sentence for the manslaughter offence was accumulated by 12 months on the sentence for the wounding offence18. The aggregate sentence was a term of 17 years and two months' imprisonment with a non-parole period of 13 years19. It will expire on 7 November 2027. The earliest date on which the appellant will be eligible for release on parole is 8 September 202320. On 11 December 2015, Kiefel and Gageler JJ granted the appellant special leave to appeal on grounds which contend that the Court of Criminal Appeal erred (i) in its application of the principle in De Simoni to justify the imposition of a sentence of greater severity; and (ii) in concluding that, in circumstances in which the appellant's single act was the genesis of both offences, it was necessary to partially accumulate the sentences. These grounds do not, in terms, challenge the Court of Criminal Appeal's conclusion that each sentence was manifestly inadequate. The appellant seeks to overcome this difficulty by contending that the "De Simoni error" infected the Court of Criminal Appeal's assessment of the inadequacy of the sentence for manslaughter. If that proposition were to be made good, it might affect the Court of Criminal Appeal's allied conclusion that the manslaughter sentence could not comprehend the criminality of both offences. Nonetheless, for the reasons to be given, the proposition is not made good. The Court of Criminal Appeal's conclusion that each sentence was manifestly inadequate stands. It follows that the appeal must be dismissed. 16 R v Nguyen (2013) 234 A Crim R 324 at 343 [113]. 17 R v Nguyen (2013) 234 A Crim R 324 at 345 [128]. 18 R v Nguyen (2013) 234 A Crim R 324 at 344 [123]. 19 R v Nguyen (2013) 234 A Crim R 324 at 345 [126]. 20 R v Nguyen (2013) 234 A Crim R 324 at 345 [128]. Bell The factual background The appellant was living in a unit in Bankstown and had the use of Garage 8, which was located in the basement of the unit complex. About two weeks before the events giving rise to this matter, the appellant was the victim of an attempted robbery. He was inside Garage 8 when two masked men armed with cricket bats entered. The appellant shouted at them and they fled, leaving a mobile telephone behind. Following this incident, the appellant obtained a pistol with a view to defending himself against any further attempted robbery. He did not have a licence to possess the pistol. On the evening of 8 September 2010, the appellant and an associate, Tan Chung, were in Garage 1 of the unit complex discussing a drug deal with three other men. Earlier that day, the police had obtained a warrant to search the appellant's unit and Garage 8. Shortly after negotiations over the drug deal came to an end and the three men left Garage 1, the police entered the basement of the unit complex. Detective Senior Constable Roberts was in charge of the execution of the search warrant. Eight officers were involved in the operation. Three were in uniform and the remainder were in civilian clothing. They did not anticipate that the appellant would be armed and the operation was assessed as a low risk one. Detective Roberts and the deceased, in civilian clothes, were the first officers to enter the basement of the complex. Detective Roberts was carrying a battering ram and the deceased was carrying a folder containing the search warrant and other documents. They walked towards Garage 1 in the mistaken belief that it was Garage 8. Other officers also in civilian clothes were close behind them. None had drawn a firearm. They announced that they were police several times as they approached Garage 1. The deceased was in front of Detective Roberts. Detective Roberts heard the deceased call out "gun, he has a gun". The appellant emerged from Garage 1 in a crouched position holding a pistol and pointing it at the police. The deceased and Detective Roberts identified themselves as police officers and instructed the appellant to put down the gun. The appellant fired at the deceased. The bullet penetrated the soft tissue of the deceased's left upper arm. The deceased responded by firing three shots in quick succession but none hit the appellant. Detective Roberts drew his firearm and took cover behind a brick wall. From this position he fired at the appellant. The bullet struck the deceased in the neck. This was the fatal wound. As the deceased lay bleeding on the ground, the appellant attempted to fire again. His pistol appeared to be jammed. He then picked up the battering ram and simulated its use as a gun, pointing it towards the police. He and Chung then retreated into the garage, from which they made their way to the appellant's unit. Bell The appellant repeatedly told Chung that the men were "fake police" who thought that he had money. When it became clear to the police that the appellant was no longer in the basement, they were able to render first aid to the deceased. He was taken by ambulance to hospital, where death was pronounced. The appellant was arrested later that evening in his unit. The police searched Garages 8 and 1 and located items associated with prohibited drugs, including a set of scales, empty resealable plastic bags and 3.21 grams of N,N-Dimethylamphetamine. Samples of the appellant's blood and urine taken after his arrest revealed relatively minor concentrations of morphine, amphetamine and methylamphetamine. The results were consistent with the appellant's history of habitual drug use. The consumption of this quantity of drugs would not have had any relevant impact on the appellant's perception of events at the time of the shooting. In an interview with the police after his arrest, the appellant gave an account that he had seen two men standing at the entrance to the garage and that he believed they were there to rob him. He told the police about the earlier attempted robbery. The police confirmed that account. They traced the robbers from the mobile telephone that had been dropped during the attempted robbery. The appellant told the police that he and Chung had gone to the garage to smoke heroin. He said that, at the time of the incident, Chung was organising a deal involving eight ounces of cocaine. At the sentence hearing, the appellant accepted that his account that he was not involved in this transaction was false. The extent of his involvement was not further explored. The basis of the appellant's plea of guilty to manslaughter At the sentence hearing, the prosecutor tendered a document styled "Crown Case Summary", which contained an agreed statement of facts and the prosecutor's analysis of the basis of the appellant's liability for each offence. Liability for the manslaughter of the deceased was put on the basis that the prosecution could not negative the partial defence of excessive self-defence, which is provided in s 421 of the Crimes Act. The appellant accepted that his act in firing the pistol caused the death of the deceased because it substantially contributed to the exchange in which the fatal shot was fired and that consequence was reasonably foreseeable21. 21 R v Nguyen [2013] NSWSC 197 at [33]. Bell Section 421(1)(c) applies to a person who uses force involving the infliction of death where that conduct is not a reasonable response in the circumstances as the person perceives them but the person believes the conduct is necessary in self-defence or defence of another. In such a case, s 421(2) provides the person is not criminally responsible for murder but, on a trial for murder, is to be found guilty of manslaughter if the person is otherwise criminally responsible for manslaughter. The prosecution conceded that, at the time the appellant presented his firearm, it could not disprove that he considered it necessary to do what he did in order to defend himself in circumstances in which he believed that "the men approaching him may well be people involved in the drug trade who were trying to 'rip him off'." The prosecution contended, and by his plea the appellant accepted, that his conduct was not a reasonable response in the circumstances as he perceived them to be. The basis of the appellant's liability for what would otherwise have been the murder of the deceased was not further explored below or in this Court. Murder is defined under s 18(1)(a) of the Crimes Act. The mental element of the offence requires that the accused's act causing the death charged is done with reckless indifference to human life, or with the intent to kill or to inflict grievous bodily harm upon some person. The appellant's plea to the wounding offence acknowledged that, at the time he fired the pistol, he had the intention of inflicting grievous bodily harm. The sentencing judge's findings The sentencing judge referred to the appellant's background by reference to a report prepared by the Probation and Parole Service22. In summary, the appellant was aged 55 years at the date of the offences. He had a criminal history, which included a conviction in mid-2006 for the supply of a commercial quantity of a prohibited drug. He was sentenced for this offence by the District Court of New South Wales to a term of three years' imprisonment with an 18 month non-parole period. The appellant was a habitual user of prohibited drugs. He had become dependent on drugs following the death of his first wife. His drug use led to the breakdown of his relationship with his three children. He had remarried and was living with his second wife at the date of the offences but the two had separated while he was a remand prisoner. 22 R v Nguyen [2013] NSWSC 197 at [59]. Bell The sentencing judge accepted that the appellant had shown remorse for the offences but her Honour found the weight of this factor was largely overwhelmed by the aggravating features of the offences23. A discount of 10 per cent was allowed to reflect the utilitarian value of the appellant's pleas of guilty. judge The sentencing three circumstances of aggravation, which applied to both offences: its commission involved the use of a firearm24; it was carried out without regard to public safety25; and the victim was a police officer and the offence arose because of his occupation26. Her Honour assessed that each offence was objectively serious27. into account took To the extent that it was relevant to assess where the wounding offence lay within a range of such offences28, the sentencing judge determined that it was within the mid-range. This conclusion took into account "some allowance" for the fact that the appellant believed the men were robbers and that the wound itself was not serious29. The offence nonetheless was of mid-range of seriousness because it involved the use of a firearm30. The De Simoni issue The prosecution submitted that each offence was within the category of "worst case". The sentencing judge's reasons for rejecting that submission are set out in [57] of her reasons. The last two sentences of that paragraph gave rise to the Director's first ground in the Court of Criminal Appeal31: 23 R v Nguyen [2013] NSWSC 197 at [65]. 24 R v Nguyen [2013] NSWSC 197 at [43], citing Sentencing Act, s 21A(2)(c). 25 R v Nguyen [2013] NSWSC 197 at [55], citing Sentencing Act, s 21A(2)(i). 26 R v Nguyen [2013] NSWSC 197 at [53], citing Sentencing Act, s 21A(2)(a). 27 R v Nguyen [2013] NSWSC 197 at [57]. 28 Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39. 29 R v Nguyen [2013] NSWSC 197 at [58]. 30 R v Nguyen [2013] NSWSC 197 at [58]. 31 R v Nguyen [2013] NSWSC 197 at [57]. Bell "I am not persuaded, however, that either offence is in the worst category. It would have been otherwise were the offender to have shot at Constable Crews intending to inflict grievous bodily harm knowing or believing he was a police officer, or were he with that same state of awareness to have pleaded guilty to manslaughter on the basis that Constable Crews was killed by his unlawful and dangerous act in shooting at him." The Director submitted that the sentencing judge wrongly discounted the seriousness of the manslaughter by taking into account that the appellant did not know the deceased was a police officer. In the Director's submission, this was a breach of the sentencing principle stated in De Simoni32. The appellant did not take issue with the Director's invocation of the De Simoni principle in the Court of Criminal Appeal. The focus of the appellant's response to this ground in that Court was on the discretionary nature of the sentencing judge's assessment of objective seriousness33. to an impermissible factor."35 It will be recalled that the Director's first ground of appeal was expressed in terms that the sentencing judge erred in the assessment of the objective seriousness of the manslaughter offence34. The Court of Criminal Appeal upheld this ground, stating that error had been demonstrated "in the finding of reduced objective seriousness by reference The impermissible factor was the appellant's lack of knowledge or belief that the deceased was a police officer. The Court of Criminal Appeal observed that, had the appellant known that he was shooting at a police officer, the basis of his liability for manslaughter, and not murder, would have been removed36. In reasoning to this conclusion, the Court accepted the Director's submission that the error constituted a breach of the principle in De Simoni37. The Court of Criminal Appeal said that the De Simoni principle is breached when, in assessing the objective seriousness of an offence, the sentencing court takes into account the absence of a factor that would warrant conviction for a more serious 32 R v Nguyen (2013) 234 A Crim R 324 at 334 [41], citing (1981) 147 CLR 383 at 33 R v Nguyen (2013) 234 A Crim R 324 at 334 [44]. 34 R v Nguyen (2013) 234 A Crim R 324 at 327 [7(a)]. 35 R v Nguyen (2013) 234 A Crim R 324 at 336 [54]. 36 R v Nguyen (2013) 234 A Crim R 324 at 335 [47]. 37 R v Nguyen (2013) 234 A Crim R 324 at 335 [50], [52]. Bell offence38. That proposition was illustrated by saying that it would be a breach of the De Simoni principle to take into account the absence of the infliction of grievous bodily harm in assessing the objective seriousness of an assault occasioning actual bodily harm39. The De Simoni principle The principle in De Simoni, stated by Gibbs CJ, is that40: "[A] judge, in imposing sentence, is entitled to consider all the conduct of the accused, including that which would aggravate the offence, but cannot take into account circumstances of aggravation which would have warranted a conviction for a more serious offence." The appellant is correct in submitting that the De Simoni principle operates for the benefit of the offender and does not apply to preclude a sentencing court from taking into account the absence of a factor which, if present, may have rendered the offender guilty of a more serious offence. This is because the De Simoni principle is an aspect of the fundamental principle that no one should be punished for an offence of which the person has not been convicted41. This is not to say that the Court of Criminal Appeal was wrong to hold that a judge sentencing an offender for an offence of assault occasioning actual bodily harm would err if the judge assessed the seriousness of the offence by taking into account that the offender had not inflicted grievous bodily harm upon the victim. The judge would err because, plainly enough, that fact is irrelevant to the assessment of the seriousness of an assault occasioning actual bodily harm. The Court of Criminal Appeal's adoption of the Director's reference to De Simoni was misplaced. However, as their Honours made clear, the Director's first ground was upheld because the Court of Criminal Appeal considered that the sentencing judge allowed "an extraneous or irrelevant consideration" to affect her decision42: this was an error of the second kind identified in House v The 38 R v Nguyen (2013) 234 A Crim R 324 at 335 [51]. 39 R v Nguyen (2013) 234 A Crim R 324 at 335 [50]. 40 (1981) 147 CLR 383 at 389. 41 (1981) 147 CLR 383 at 389 per Gibbs CJ. 42 R v Nguyen (2013) 234 A Crim R 324 at 335 [52]. Bell King43. The appellant's perception, that the deceased was a robber and not that he was a police officer, was not material to the assessment of the objective seriousness of the manslaughter44. The gravamen of that offence was the taking of a life in self-defence where the act was not a reasonable response to the circumstances as the appellant perceived them. The appellant submits that, correctly understood, the sentencing judge was not making an assessment of the objective seriousness of the manslaughter of which he was convicted in the impugned passage: her Honour was positing an hypothetical case of manslaughter by unlawful and dangerous act to explain her rejection of the prosecutor's "worst case" submission. It may be, as the appellant submits, that the Court of Criminal Appeal did misapprehend the sentencing judge's analysis in the concluding sentence of [57]. The Court of Criminal Appeal referred to an "additional difficulty" in the sentencing judge's analysis arising from the reference to a "different approach" being available had the appellant "pleaded guilty to manslaughter on the basis that Constable Crews was killed by his unlawful and dangerous act in shooting at him."45 Their Honours said, "it is difficult to see how the act of shooting at a police officer with intent to inflict grievous bodily harm could be characterised merely as an unlawful and dangerous act for the purpose of the law of manslaughter."46 In the last sentence of [57], the sentencing judge addressed the prosecutor's "worst case" submission in relation to each of the offences in turn. Her Honour observed, with respect to the wounding offence, that to have fired at the deceased intending to inflict grievous bodily harm knowing or believing that he was a police officer would have come within the worst category of offence. Next, her Honour turned to the manslaughter offence and observed that had the appellant with "that same state of awareness" – a reference to knowledge or belief that the deceased was a police officer – been convicted of manslaughter based on his unlawful and dangerous act of shooting at him, that offence, too, would have been in the worst category of offence. Contrary to the Court of Criminal Appeal's statement, the sentencing judge was not discussing liability for manslaughter in circumstances in which the firing of the weapon was accompanied by the intent to do grievous bodily harm. 43 (1936) 55 CLR 499 at 505 per Dixon, Evatt and McTiernan JJ; [1936] HCA 40. 44 R v Nguyen (2013) 234 A Crim R 324 at 341 [95]. 45 R v Nguyen (2013) 234 A Crim R 324 at 335-336 [53]. 46 R v Nguyen (2013) 234 A Crim R 324 at 336 [53] (emphasis added). Bell In sentencing for any offence, it will seldom assist in determining whether a case is in the worst category to hypothesise some different case which is arguably more heinous47. That proposition has even more force in the case of sentencing for manslaughter, the most protean of all offences. Here, in dealing with the prosecutor's "worst case" submission, the sentencing judge proposed that the involuntary manslaughter of the deceased (by unlawful and dangerous act) in circumstances in which it was known that the deceased was a police officer was a more objectively serious offence than the voluntary manslaughter (murder reduced to manslaughter by reason of excessive self-defence) with which she was dealing48. The determination of whether the appellant's offence was in the category of "worst case", and for that reason deserving of the maximum penalty, was hardly assisted by comparison with the improbable hypothesised offence. Nonetheless, it was not legal error for the sentencing judge to illustrate her rejection of the prosecutor's submission in the way that she did. Nor was it error to consider that a case of involuntary manslaughter may be more objectively grave than a case of voluntary manslaughter49. The Court of Criminal Appeal did not hold that the sentencing judge erred by rejecting the prosecutor's "worst case" submission. Contrary to the appellant's argument in this Court, the Court of Criminal Appeal did not conclude that the offence was in the worst category of case50. The Court of Criminal Appeal reasoned that the hypothesised case suggested that the sentencing judge wrongly considered that the appellant's lack of awareness that the deceased was a police officer lessened the objective seriousness of this manslaughter51. This conclusion served to explain the imposition of a sentence which was manifestly inadequate52. It is the latter conclusion that must be overcome if the appellant is to succeed. 47 Veen v The Queen [No 2] (1988) 164 CLR 465 at 478 per Mason CJ, Brennan, Dawson and Toohey JJ; [1988] HCA 14. 48 See Fisse, Howard's Criminal Law, 5th ed (1990) at 78. 49 R v Isaacs (1997) 41 NSWLR 374 at 381 per Gleeson CJ, Mason P, Hunt CJ at CL, 50 Ibbs v The Queen (1987) 163 CLR 447 at 451-452 per Mason CJ, Wilson, Brennan, Toohey and Gaudron JJ; [1987] HCA 46. 51 R v Nguyen (2013) 234 A Crim R 324 at 335 [52]. 52 See House v The King (1936) 55 CLR 499 at 505 per Dixon, Evatt and Bell The structure of the sentences The appellant's second ground of appeal contends that the Court of Criminal Appeal erred in holding that the sentencing judge was required to partially accumulate the sentences. Her Honour determined that the sentences should be wholly concurrent because, while there were different consequences attending his criminal act, that act was common to both offences. Her Honour considered that the total criminality constituted by the appellant's offending could be comprehended by the sentence for the manslaughter53. The Court of Criminal Appeal rejected this analysis, observing that "[a]lthough there was but a short period of time that passed between the offences, they were distinct offences caused by different bullets causing very different consequences."54 The Court of Criminal Appeal said the nature and seriousness of the wounding offence was such that the sentence for manslaughter could not sufficiently comprehend the criminality involved in it55. Just as a sentencing judge is accorded as much flexibility as is consonant with the statutory sentencing regime in determining the appropriate sentence56, so, too, the judge is to be accorded the same flexibility in determining the structure of two or more sentences57. The Sentencing Act does not confine the approach to be taken to the structure of two or more sentences. It assumes concurrency in the absence of a direction to the contrary58. The sentencing judge was required to impose an appropriate sentence for each offence and to structure the sentences such that the overall sentence was just and appropriate to the totality of the appellant's offending behaviour59. As the Court of Criminal Appeal correctly said, the question of concurrency or partial accumulation 53 R v Nguyen [2013] NSWSC 197 at [69]. 54 R v Nguyen (2013) 234 A Crim R 324 at 339 [81]. 55 R v Nguyen (2013) 234 A Crim R 324 at 340 [83]. 56 Markarian v The Queen (2005) 228 CLR 357 at 371 [27] per Gleeson CJ, Gummow, Hayne and Callinan JJ; [2005] HCA 25. 57 Johnson v The Queen (2004) 78 ALJR 616 at 624 [26] per Gummow, Callinan and Heydon JJ; 205 ALR 346 at 356; [2004] HCA 15. 58 Sentencing Act, s 55(2). 59 Mill v The Queen (1988) 166 CLR 59 at 62-63 per Wilson, Deane, Dawson, Toohey and Gaudron JJ; [1988] HCA 70. Bell required consideration of whether the sentence for the manslaughter offence could encompass the criminality of both offences60. In approaching this ground, the Court of Criminal Appeal observed that sentences are not to be made concurrent "because of the similarity of the conduct" or because the conduct may be seen to be part of the one course of criminal conduct61. Public confidence in the administration of justice was said to require that sentencing courts avoid any suggestion of a discount for multiple offending62. The Court referred in this respect to R v MAK63. Somewhat different considerations were raised in that case, which was concerned with the application of the totality principle to the sentencing of an offender for sexual offences in circumstances in which the offender was serving sentences for unrelated sexual offences. In this case, the appellant was being sentenced for two offences, each of which arose from his unlawful act in firing the pistol. The appellant was not to be punished twice for the commission of an element that was common to the two offences64. Nonetheless, the intent to cause grievous bodily harm, an element of the wounding offence, was not an element of liability for the manslaughter. Accepting this, it remains that the appellant's liability for the manslaughter was inextricably linked to the wounding offence. This offence of voluntary manslaughter, done in excessive self-defence, assumed that the act that in law caused the death was accompanied by the intent to cause grievous bodily harm. In the circumstances, it cannot be said that it was not open to the sentencing judge to impose wholly concurrent sentences provided the criminality of both offences was appropriately reflected in the sentence for the manslaughter. The appellant's second ground succeeds to the extent that the Court of Criminal Appeal is to be understood as holding that the nature and seriousness of the wounding offence was such that an appropriate sentence for the manslaughter was not capable of comprehending the criminality involved in the wounding 60 R v Nguyen (2013) 234 A Crim R 324 at 339 [78]. 61 R v Nguyen (2013) 234 A Crim R 324 at 339 [78]. 62 R v Nguyen (2013) 234 A Crim R 324 at 339 [80]. 63 (2006) 167 A Crim R 159 at 164-165 [18] per Spigelman CJ, Whealy and 64 Pearce v The Queen (1998) 194 CLR 610 at 623 [40] per McHugh, Hayne and Callinan JJ; [1998] HCA 57. Bell offence65. It is difficult to separate the Court of Criminal Appeal's conclusion that the order for concurrency failed to adequately reflect the appellant's overall criminality from its conclusion that the sentence for each offence was manifestly inadequate. Again, success on this ground does not assist the appellant unless that conclusion is overcome. Moreover, recognition that it was open to impose appropriate concurrent sentences does not mean that it was an error for the Court of Criminal Appeal, in the exercise of its discretion, to provide for partial accumulation in the sentences it imposed. Manifest inadequacy As earlier explained, the appellant contends that the conclusion of manifest inadequacy, in the case of the manslaughter sentence, is tainted by the Court of Criminal Appeal's recourse to the De Simoni principle in assessing the objective seriousness of the offence. The appellant identifies the error for which he contends in the following statement66: "This was a most serious example of the crime of manslaughter. For reasons explained in the context of the first ground of appeal, the fact that the [appellant] did not know or believe that the persons in the garage were police officers is not relevant to an assessment of the objective gravity of the manslaughter offence." The appellant's complaint is that the Court of Criminal Appeal wrongly confined its assessment of the gravity of the offence by the exclusion of any consideration of his mental state. He contends that the determination of whether the sentence imposed by the sentencing judge was unreasonably lenient required that all the circumstances of the offence be taken into account. In particular, the appellant submits it was important to take into account that he acted in the heat of the moment, believing that he needed to fire at the deceased in order to defend himself. The Court of Criminal Appeal well understood that the appellant's plea of guilty to manslaughter was offered, and accepted, on the basis that the prosecution could not negative the partial defence provided by s 421(1) of the Crimes Act. This and the facts were recited earlier in the Court of Criminal Appeal's reasons67. As earlier explained, the Court of Criminal Appeal was correct to say that the appellant's perception that the deceased was a robber was 65 R v Nguyen (2013) 234 A Crim R 324 at 340 [83]. 66 R v Nguyen (2013) 234 A Crim R 324 at 341 [95]. 67 R v Nguyen (2013) 234 A Crim R 324 at 327-331 [9]-[17]. Bell not material to the assessment of the gravity of the manslaughter68. The Court of Criminal Appeal was also correct in assessing that this was a most serious example of the crime of manslaughter69. The appellant chose to arm himself with a pistol in order to ward off others involved in the drug milieu from further attempts to rob him. When confronted by men who he believed were out to "rip him off", he fired the pistol, leading to the fatal exchange of gunfire. This took place in the basement of a suburban block of units with the attendant risk to the safety of residents and other members of the public. In the event, a policeman carrying out his lawful duty was killed. As the sentencing judge correctly appreciated, this was a circumstance of aggravation notwithstanding that the appellant did not know the deceased was a police officer at the time he fired at him. The Court of Criminal Appeal's conclusion that a sentence of nine and a half years was manifestly inadequate to reflect the seriousness of the offence was plainly correct. The decision was not attended by material error and, for that reason, the appeal must be dismissed. 68 R v Nguyen (2013) 234 A Crim R 324 at 341 [95]. 69 R v Nguyen (2013) 234 A Crim R 324 at 341 [95]. NettleJ Upon pleading guilty on GAGELER, NETTLE AND GORDON JJ. arraignment to one count of manslaughter and one count of wounding with intent to cause grievous bodily harm, the appellant was sentenced by a judge of the Common Law Division of the Supreme Court of New South Wales (Fullerton J)70. For the offence of manslaughter the appellant was sentenced to a term of imprisonment of nine years and six months (comprised of a non-parole period of seven years and a balance term of two years and six months). For the offence of wounding with intent to cause grievous bodily harm the appellant was sentenced to a term of imprisonment of six years and three months (comprised of a non-parole period of four years and nine months and a balance term of one year and six months). The sentence for each offence was backdated to commence on 8 September 2010. In imposing these sentences the judge correctly took into account an additional offence71, being the unauthorised possession of a prohibited firearm ("the Form 1 offence"). On a Crown appeal to the Court of Criminal Appeal of the Supreme Court of New South Wales, the sentences were quashed and the appellant was re- sentenced72. For the offence of wounding the appellant was re-sentenced to imprisonment comprising a non-parole period of six years, commencing on 8 September 2010 and expiring on 7 September 2016, with a balance term of two years and one month, commencing on 8 September 2016 and expiring on 7 October 2018. For the offence of manslaughter the appellant was re-sentenced to imprisonment comprising a non-parole period of 12 years, commencing on 8 September 2011 and expiring on 7 September 2023, with a balance term of four years and two months, commencing on 8 September 2023 and expiring on 7 November 2027. By grant of special leave, the appellant now appeals to this Court against the whole of the judgment and orders of the Court of Criminal Appeal. The facts In brief substance, the appellant shot and wounded the deceased, who was a police officer, while the deceased was lawfully executing a search warrant in company with other police officers on premises in close proximity to the appellant's home. The shot struck the deceased in the arm, thereby causing him a serious but non-fatal gunshot wound. In the course of the fire-fight which ensued, one of the other police officers fired a shot which was intended for the 70 R v Nguyen [2013] NSWSC 197. 71 Crimes (Sentencing Procedure) Act 1999 (NSW), s 33(2). 72 R v Nguyen (2013) 234 A Crim R 324. NettleJ appellant, but which unfortunately instead hit the deceased in the neck, thereby inflicting a wound from which he later died. In the circumstances which obtained, the Crown accepted that it could not exclude as a reasonable possibility that, when the appellant fired at the deceased, the appellant honestly believed that the deceased was someone posing as a police officer who was intent on robbing the appellant and might have posed a serious risk to the appellant's safety. The appellant pleaded guilty to manslaughter. By his plea and agreement with the Crown statement of facts he may be taken to have accepted responsibility for killing the deceased by excessive self-defence on the basis that, by firing at the deceased, the appellant substantially contributed to the ensuing exchange of gunfire in circumstances where it was reasonably foreseeable that someone in the vicinity of the exchange might be fatally, even if inadvertently, shot, and that a reasonable person in the appellant's position would not have considered it necessary so to shoot in defence of himself or of property. The judge's sentencing remarks The sentencing judge delivered detailed and comprehensive sentencing remarks. For the purposes of this appeal, however, it is necessary to refer to only two aspects of her Honour's reasoning. The first is her assessment of the objective gravity of the offence of manslaughter, of which her Honour said as follows73: "I accept that the offender was unaware that Constable Crews was a police officer when he shot him and that, although he did not fire the shot that killed Constable Crews, he caused his death. I also accept that when he discharged the pistol that caused his death and the wounding he had a genuine belief (entirely misplaced) that he needed to defend himself against a perceived threat of harm. Notwithstanding those findings, the circumstance in which the offences were committed, including the aggravating factors to which I have referred, render both offences objectively serious. I am not persuaded, however, that either offence is in the worst category. It would have been otherwise were the offender to have shot at Constable Crews intending to inflict grievous bodily harm knowing or believing he was a police officer, or were he with that same state of awareness to have pleaded guilty to manslaughter on the basis that 73 R v Nguyen [2013] NSWSC 197 at [57]. NettleJ Constable Crews was killed by his unlawful and dangerous act in shooting at him." The second is her Honour's conclusion that the sentence imposed for the offence of manslaughter and the sentence imposed for the offence of wounding should be wholly concurrent. Of that her Honour said this74: "Although the consequences of the offender's criminal act are different (in that the bullet he fired caused a wounding while the bullet he caused to be fired caused a death), the same criminal conduct is common to both offences. Detective Senior Constable Roberts has no criminal liability for firing the fatal shot. In these circumstances I am satisfied that the total criminality constituted by his offending can be comprehended by the sentence for the manslaughter, which I accept is the more serious offence by reason of the loss of life." The decision of the Court of Criminal Appeal The Court of Criminal Appeal (Beazley P, Johnson and RA Hulme JJ) held that the judge erred in her assessment of the objective gravity of the offence of manslaughter by contrasting it with what the judge supposed would have been the gravity of the offence if the appellant had known that the deceased was a police officer. In substance, the Court of Criminal Appeal reasoned that if the appellant had been aware that the deceased was a police officer the offence would have been murder, not manslaughter, and thus that the judge erred by taking into account the absence of a circumstance which, had it been present, would have warranted conviction for a more serious offence than manslaughter. The Court of Criminal Appeal described that as a breach of the principle deriving from R v De Simoni75. The Court of Criminal Appeal also considered that the judge erred by not cumulating part of the sentence imposed for the offence of wounding on the sentence imposed for the offence of manslaughter. Their Honours reasoned that the two offences were "distinct offences caused by different bullets causing very different consequences" and thus that "[a] measure of accumulation was necessary"76. 74 R v Nguyen [2013] NSWSC 197 at [69]. 75 (1981) 147 CLR 383; [1981] HCA 31. 76 R v Nguyen (2013) 234 A Crim R 324 at 339 [81], 340 [83]. NettleJ Ultimately, the Court of Criminal Appeal was satisfied that the sentences were manifestly inadequate, having had regard to the nature and gravity of the offences, the circumstances in which they were committed and the personal circumstances of the appellant, including his age and antecedents. Parties' contentions The appellant contends that the Court of Criminal Appeal erred in its application of what it described as the De Simoni principle; erred in holding that the judge was wrong not to cumulate some part of the sentence imposed for the offence of wounding on the sentence imposed for the offence of manslaughter; and, as a consequence, erred in holding that the sentences imposed by the judge were manifestly inadequate. The respondent contends that there is no error disclosed in the Court of Criminal Appeal's reasoning. Reference to De Simoni misplaced The Court of Criminal Appeal was correct in holding that the sentencing judge erred in her assessment of the objective gravity of the offence of manslaughter by contrasting it with what the judge supposed would have been the gravity of the offence if the appellant had known that the deceased was a police officer. Contrary to the appellant's submissions, the judge's comparison of the subject offence with the supposed offence cannot properly be regarded as a comparison with some other hypothetical offence of manslaughter falling short of murder. As her Honour made clear, she was referring to "the offender", and considering how "his" offending might have risen to the "worst category" of manslaughter if the additional circumstance of knowing that the deceased was a police officer were present. The problem with this approach was, as the Court of Criminal Appeal recognised, that if the appellant had known that the deceased was a police officer, and had shot him with intent to cause grievous bodily harm, there would have been no basis for the appellant's invocation of the partial defence of excessive self-defence. The appellant would have been guilty of murder. It is irrelevant in assessing the objective gravity of an offence of manslaughter to contrast it with what would be an offence of murder. It is erroneous because it is likely to result in an assessment of the relative gravity of the subject offence which ill-accords with its objective gravity relative to other instances of offences of that kind. NettleJ Consequently, the judge's comparison of the gravity of the subject offence of manslaughter with what she supposed would have been the gravity of the offence if the appellant had known that the deceased was a police officer was an erroneous comparison that was likely to result, and appears in fact to have resulted, in the judge concluding that the objective gravity of the subject offence of manslaughter ranked lower in the range of gravity of offences of manslaughter than in fact it did. The Court of Criminal Appeal was not correct, however, in characterising the judge's comparison of the subject offence with the supposed offence as a contravention of the De Simoni principle. The De Simoni principle prohibits a judge taking into account, as an aggravating circumstance of an offence, a circumstance or factor which would render the offence a different and more serious offence77. It has nothing to say about the impropriety of a judge taking into account the absence of a circumstance which, if it were present, would render the subject offence a different offence. The latter is erroneous simply because it is irrelevant to, and likely to distort, the assessment of objective gravity. Accumulation of sentences The Court of Criminal Appeal concluded that it was not open to the sentencing judge to decline to cumulate any part of the sentence imposed for the offence of wounding on the sentence imposed for the offence of manslaughter. That is debatable. The appellant was liable to be convicted of the deceased's manslaughter because he fired a shot at the deceased with intent to cause grievous bodily harm in circumstances where it was foreseeable that one of the deceased's colleagues would return fire and in the process unintentionally kill the deceased. Arguably, within the relatively broad confines of the proper exercise of sentencing discretion78, including in particular the need to moderate and cumulate individual sentences in accordance with the requirements of the principle of totality79, the judge might properly have concluded that the criminality of the offence of wounding with intent to cause grievous bodily harm 77 (1981) 147 CLR 383 at 389 per Gibbs CJ (Mason and Murphy JJ agreeing at 395). 78 Pearce v The Queen (1998) 194 CLR 610 at 624 [46] per McHugh, Hayne and Callinan JJ; [1998] HCA 57; Hili v The Queen (2010) 242 CLR 520 at 543 [74] per Heydon J; [2010] HCA 45. 79 Mill v The Queen (1988) 166 CLR 59 at 62-63; [1988] HCA 70. NettleJ was sufficiently comprised within the criminality of the offence of manslaughter to warrant that the sentences for each offence be made wholly concurrent80. Whether or not it was appropriate to make the sentences wholly concurrent depends, however, as much on the sentence imposed for the offence of manslaughter as it does on whether the offence of wounding involved any criminality beyond that comprised in the offence of manslaughter. Ultimately the object of the sentencing exercise is to impose individual sentences that, so far as possible, accurately reflect the gravity of each offence81 while at the same time rendering a total effective sentence which, so far as possible, accurately reflects the totality of criminality comprised in the totality of offences82. That is an exercise which involves a significant measure of discretionary moderation and accumulation of individual sentences according to the particular circumstances of each case83. Up to a point, therefore, it is something about which sentencing judges might take different views of which neither could be said to be wrong84. Generally speaking, however, the imposition of less severe individual sentences may call for a greater degree of accumulation in order to reflect total criminality whereas more severe individual sentences may necessitate a greater degree of concurrency. It follows that, if the judge had imposed an individual sentence for the offence of manslaughter adequate to reflect the criminality of that offence, it might be that little if any accumulation of the sentence imposed for the offence of wounding would have been required85. For the reasons which follow, however, 80 Cf Royer v Western Australia (2009) 197 A Crim R 319 at 328 [21]-[22] per 81 Crimes (Sentencing Procedure) Act 1999 (NSW), s 3A(a); R v McNaughton (2006) 66 NSWLR 566 at 572 [15] per Spigelman CJ. 82 Mill (1988) 166 CLR 59 at 62-63; Pearce (1998) 194 CLR 610 at 623-624 [43]- [45] per McHugh, Hayne and Callinan JJ. 83 Mill (1988) 166 CLR 59 at 62-63; Director of Public Prosecutions v Grabovac [1998] 1 VR 664 at 680 per Ormiston JA (Winneke P agreeing at 665, Hedigan AJA agreeing at 690). 84 Hammoud (2000) 118 A Crim R 66 at 67 [7] per Simpson J. 85 Cf R v Jarrold [2010] NSWCCA 69 at [56] per Howie J (McClellan CJ at CL agreeing at [1], Harrison J agreeing at [79]). NettleJ the individual sentence imposed for the offence of manslaughter was not adequate to reflect its criminality. Manifest inadequacy The Court of Criminal Appeal was correct to hold that the sentence imposed by the judge for the offence of manslaughter and, consequently, the total effective sentence were manifestly inadequate. The nature and gravity of the subject offence of manslaughter was such that a sentence of nine years and six months' imprisonment was so plainly short of the mark as to bespeak error of principle86 and therefore necessitate appellate intervention87. As their Honours observed, the subject offence of manslaughter was a particularly serious instance of the crime which was aggravated by the circumstance that the deceased was a police officer and the appellant ought clearly to have foreseen that possibility88. It was also necessary to keep in mind that the Form 1 offence was objectively grave and exacerbated by the facts that the weapon was loaded and kept for use by a person who was engaged in criminal activities. In those circumstances, it was necessary to impose a greater sentence for the offence of manslaughter in order to demonstrate the need for personal deterrence and retribution in relation to the Form 1 offence. In the circumstances, it was appropriate, too, to cumulate a small part of the sentence imposed for the offence of wounding on the sentence imposed for the offence of manslaughter. The offences were separate and distinct89 and, despite the commonality of the acts which comprised them, the offence of wounding with intent to cause grievous bodily harm involved an element of intent which was absent from the offence of manslaughter. That difference may 86 Wong v The Queen (2001) 207 CLR 584 at 605-606 [58] per Gaudron, Gummow and Hayne JJ; [2001] HCA 64; Hili (2010) 242 CLR 520 at 538-539 [59] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ. 87 Green v The Queen (2011) 244 CLR 462 at 486 [69] per French CJ, Crennan and Kiefel JJ; [2011] HCA 49. 88 Director of Public Prosecutions (Vic) v Arvanitidis (2008) 202 A Crim R 300 at 314-315 [50]-[52] per Redlich JA (Buchanan JA agreeing at 303 [2], Nettle JA agreeing at 304 [10]). 89 Pearce (1998) 194 CLR 610 at 624 [49] per McHugh, Hayne and Callinan JJ; R v Harris (2007) 171 A Crim R 267 at 275 [39]. NettleJ properly be regarded as an additional degree of criminality which should be reflected in some degree of accumulation of the sentences90. Re-sentencing involving a breach of Although the Court of Criminal Appeal was incorrect to describe the sentencing judge's error in the assessment of the relative gravity of the offence of the manslaughter as misdescription was not a material error. What was important, as the Court of Criminal Appeal appreciated, was that the judge's comparison of the gravity of the subject offence of manslaughter with the gravity of what would have been an offence of murder was likely to result in an under-assessment of the relative gravity of the subject offence and thus may have been the cause of the judge's imposition of an inadequate sentence for the offence of manslaughter. the De Simoni principle, For that reason, and because the sentence imposed for the offence of manslaughter was manifestly inadequate, the Court of Criminal Appeal was correct to quash the sentences imposed by the sentencing judge and re-sentence the appellant as was done. It was not suggested that there was any error in the new sentences so imposed. Conclusion The appeal should be dismissed. 90 Cf Hoad (1989) 42 A Crim R 312 at 315-316 per Cooper J.
HIGH COURT OF AUSTRALIA APPELLANT AND COMMISSIONER OF TAXATION & ANOR RESPONDENTS Clarke v Commissioner of Taxation [2009] HCA 33 2 September 2009 1. Appeal allowed. ORDER 2. Set aside order 1 of the orders of the Full Court of the Federal Court of Australia made on 13 June 2008, and in lieu thereof, order that question 3 of the questions referred to the Full Court by the Administrative Appeals Tribunal on 6 July 2007 be answered as follows: Question 3: Are the Superannuation Contributions Tax (Members of Constitutionally Funds) Imposition Act 1997 (Cth) ("the Imposition Act") and/or the Assessment Act [Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997 (Cth)] invalid in their application to the applicant: Superannuation Protected on the ground that they so discriminate against the State of South Australia or so place a particular disability or burden upon the operations and activities of the State of South Australia, as to be beyond the legislative power of the Commonwealth; or on the ground that the Imposition Act imposes a tax on property belonging to the State of South Australia the Commonwealth contrary Constitution? to section 114 of Answer: As to question 3(a), the Imposition Act and the Assessment Act are invalid insofar as they purport to create the liability of the appellant to superannuation contributions the surcharge Parliamentary State Superannuation Benefit Scheme and the Southern State Superannuation Scheme. respect of his membership of Superannuation Scheme, the 3. First respondent to pay the costs of the appellant. On appeal from the Federal Court of Australia Representation P A Heywood-Smith QC with A L Tokley for the appellant (instructed by Johnston Withers) M A Perry QC with M C Wall for the first respondent (instructed by Australian Government Solicitor) M G Hinton QC, Solicitor-General for the State of South Australia with M J Wait for the second respondent (instructed by Crown Solicitor for the State of South Australia) Interveners S J Gageler SC, Solicitor-General of the Commonwealth of Australia with M A Perry QC and M C Wall intervening on behalf of the Attorney-General of the Commonwealth of Australia (instructed by Australian Government Solicitor) R J Meadows QC, Solicitor-General for the State of Western Australia with J C Pritchard intervening on behalf of the Attorney-General for the State of Western Australia (instructed by State Solicitor for Western Australia) P M Tate SC, Solicitor-General for the State of Victoria with G A Hill intervening on behalf of the Attorney-General for the State of Victoria (instructed by Victorian Government Solicitor) W Sofronoff QC, Solicitor-General of the State of Queensland with G J D del Villar intervening on behalf of the Attorney-General of the State of Queensland (instructed by Crown Law (Qld)) M J Leeming SC with S J Free intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for New South Wales) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Clarke v Commissioner of Taxation Constitutional law (Cth) – Powers of Commonwealth Parliament – Taxation – Superannuation contributions surcharge – State parliamentary pensions – Implied limitation on Commonwealth legislative power – Melbourne Corporation doctrine – Where appellant former member of South Australian Parliament – Where appellant eligible for parliamentary pension – Whether Acts assessing and imposing superannuation contributions surcharge invalid in application to appellant – Relevance of fact that State Acts passed in response to surcharge. Words and phrases – "curtailment of capacity of the States to function as governments", "discrimination", "special burden". Constitution, ss 7, 9, 10, 15, 25, 29, 30, 31, 41, 51(ii), 95, 107, 108, 111, 123, Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997 (Cth), ss 5, 8, 9, 11, Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Imposition Act 1997 (Cth), s 4. Superannuation Guarantee (Administration) Act 1992 (Cth). Parliamentary Superannuation Act 1974 (SA). Southern State Superannuation Act 1994 (SA). Statutes Amendment (Commutation for Superannuation Surcharge) Act 1999 (SA), s 4. Statutes Amendment (Miscellaneous Superannuation Measures) Act 2004 (SA), Superannuation (Benefit Scheme) Act 1992 (SA). Introduction Under the authority conferred upon it by the Constitution the Parliament of the Commonwealth can make laws affecting the States and their agencies. It cannot, however, make laws which destroy or significantly burden, curtail or weaken either the capacity of the States to carry out their proper legislative, executive and judicial functions or their exercise of those functions. An Act of the Commonwealth Parliament imposing a surcharge specifically upon the pension entitlements of State politicians is said to be such a law. Ralph Desmond Clarke, who was born on 4 October 1951, was elected in 1993 to the Parliament of South Australia as a member of the House of Assembly. He commenced his term on 11 December 1993. He was re-elected in December 1997 and served as a member until 8 February 2002, when he lost his seat at the State election. ("the Commissioner") issued assessments of Between 15 February 2000 and 15 February 2005 the Commissioner of Taxation superannuation contribution surcharge in respect of Mr Clarke's entitlements under three State superannuation schemes for the financial year ended 30 June 1997 up to and including the financial year ended 30 June 2001. The funds were the ("the PS Scheme") contributory Parliamentary Superannuation Scheme established by the Parliamentary Superannuation Act 1948 (SA) and continued under the Parliamentary Superannuation Act 1974 (SA) ("the PS Act"); the Southern State Superannuation Scheme ("the SSS Scheme") established by the Southern State Superannuation Act 1994 (SA) ("the SSS Act"); and the State Superannuation Benefit Scheme, which was established by the Superannuation (Benefit Scheme) Act 1992 (SA) ("the SBS Act"), and was effectively rolled over into the SSS Scheme by the Southern State Superannuation (Merger of Schemes) Amendment Act 1998 (SA). The Commissioner's assessments were the Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997 (Cth) ("the CPSF Assessment Act") and the Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Imposition Act 1997 (Cth) ("the CPSF Imposition Act"). issued pursuant Mr Clarke objected to the assessments. His objections were disallowed and on 2 May 2006 he sought review by the Administrative Appeals Tribunal ("the Tribunal") of the Commissioner's disallowance decisions1. On the basis of 1 Pursuant to s 14ZZ of the Taxation Administration Act 1953 (Cth). a statement of agreed facts the Tribunal referred questions of law to the Full Court of the Federal Court, including the question: "3. Are the [CPSF Imposition Act] and/or the [CPSF Assessment Act] invalid in their application to the applicant: on the ground that they so discriminate against the State of South Australia or so place a particular disability or burden upon the operations and activities of the State of South Australia, as to be beyond the legislative power of the Commonwealth". Mr Clarke relied upon the decision of this Court in Austin v The Commonwealth2, in which the CPSF Assessment and Imposition Acts were held invalid in their application to the statutory pension entitlements of a judge of the Supreme Court of New South Wales. The Full Court distinguished Austin and answered the question in the negative3. On 13 November 2008, this Court gave special leave to appeal from the judgment and orders made on 13 June 20084. Further details of the factual and procedural history are set out in the joint judgment, as are details of the relevant State and Commonwealth legislation beyond what appears in the outline that follows5. In my opinion, the appeal should be allowed and question 3(a) should be answered in the affirmative. I agree with the orders proposed in the joint judgment. The challenged superannuation surcharge legislation By legislation of general application enacted in 1997, a surcharge was imposed on superannuation contributions made by or for taxpayers above certain taxable income thresholds6. The liability was imposed upon the providers of the (2003) 215 CLR 185; [2003] HCA 3. 3 Clarke v Federal Commissioner of Taxation (2008) 170 FCR 473. [2008] HCATrans 375. 5 See reasons of Gummow, Heydon, Kiefel and Bell JJ at [38]-[58]. 6 Superannuation Contributions Tax (Assessment and Collection) Act 1997 (Cth); Superannuation Contributions Tax Imposition Act 1997 (Cth). superannuation benefits7. This, in effect, required payment to be made out of the superannuation funds8. The surcharge did not apply to the Commonwealth9 or property of any kind belonging to a State10. A varied superannuation surcharge scheme was established by the CPSF Assessment and Imposition Acts for "constitutionally protected funds", a class defined by regulations made under Pt IX of the Income Tax Assessment Act 1936 (Cth)11. The regulations referred to funds established under a number of listed State Acts including the PS Act, the SBS Act and the SSS Act12. Liability under the CPSF Acts was imposed upon a fund member if the member's adjusted taxable income exceeded a defined threshold amount13. The Acts applied, inter alia, to persons entitled to benefits under a subset of constitutionally protected funds, including the PS Scheme, which were designated "defined benefits superannuation schemes"14. Surchargeable contributions, in respect of a defined benefits superannuation scheme, were calculated by reference to the actuarial value of the benefits accrued to the member for a given financial year, plus the actuarial value of the administration expenses and risk benefits provided in respect of the member for that year15. The CPSF Assessment Act provided for deferral of liability to pay the surcharge. Where a member became liable, the Commissioner was required to 7 Superannuation Contributions Tax (Assessment and Collection) Act 1997 (Cth), ss 8A, 10(2). 8 Austin v The Commonwealth (2003) 215 CLR 185 at 232 [65] per Gaudron, 9 Superannuation Contributions Tax (Assessment and Collection) Act 1997 (Cth), 10 Superannuation Contributions Tax Imposition Act 1997 (Cth), s 9. 11 CPSF Assessment Act, s 38; Income Tax Assessment Act 1936 (Cth), s 267(1); and Income Tax Regulations 1936 (Cth), reg 177. 12 Income Tax Regulations 1936 (Cth), Sched 14. 13 CPSF Assessment Act, ss 8, 9, 10. 14 A term defined in the CPSF Assessment Act, s 38. The term also includes statutory pension schemes such as the judicial pension scheme considered in Austin. 15 CPSF Assessment Act, s 9(4). give the member a notice of liability. The amount was to be paid within three months of the date on which the notice was issued16. If the surcharge was not paid when due, the person was liable to pay the general interest charge17 on the unpaid amount18. Commutation rights It was open to Mr Clarke, under s 21(1) of the PS Act, to commute part of his PS Scheme pension. By so doing he could have covered the potential or actual surcharge liability, in respect of his membership of the PS Scheme. This was true of all members affected by the surcharge. It was also an agreed fact that the commutation factor of $10 for every $1 reduction in the pension would be likely to result in the lump sum payable being less than the present value of the amount of pension foregone for members aged under 75 at the date of commutation. In 1999, s 21AA was introduced into the PS Act19 to ameliorate the position of members of the South Australian Parliament. It provided for PS Scheme members to commute enough of their pension entitlement to pay the deferred superannuation contribution surcharge. The applicable commutation factors were to be determined by the South Australian Treasurer on the recommendation of an actuary20. Similar amendments were made to the Judges' Pensions Act 1971 (SA), the Police Superannuation Act 1990 (SA) and the Superannuation Act 1988 (SA). In the Second Reading Speech for the 1999 Bill introducing s 21AA the Minister said that the surcharge debt at retirement could be substantial, leading "to the problems which are to be addressed by this Bill". One of the problems was that it might be up to 18 months after retirement before the member was aware of the extent of the total debt. Another problem was that persons receiving benefit in the form of an income stream or pension might not have funds readily available to pay the debt. He said21: 16 CPSF Assessment Act, s 15(7) and (8). 17 Calculated under Div 1 of Pt IIA of the Taxation Administration Act 1953 (Cth). 18 CPSF Assessment Act, s 21. 19 Statutes Amendment (Commutation for Superannuation Surcharge) Act 1999 (SA), 20 PS Act, s 21AA(6). 21 South Australia, House of Assembly, Parliamentary Debates (Hansard), 9 March "The general aim of the Bill is to ensure that persons with an accumulated surcharge debt with the Australian Taxation Office, have at retirement a method of obtaining a lump sum to expunge the debt with the Australian Taxation Office." A similar provision was made for the SSS Scheme and is described in the joint judgment. Implied limits on Commonwealth legislative power affecting the States The Constitution assumes the continuing existence of the States, their co- existence as independent entities with the Commonwealth, and the functioning of their governments. This assumption is readily inferred from the reference to "one indissoluble Federal Commonwealth" in the Preamble and the terms of ss 3, 5 and 6 of the Commonwealth of Australia Constitution Act 1900 (Imp)22 and the provisions of Ch V of the Constitution itself. It underpins an implied limitation on Commonwealth power to make laws affecting the States. The existence of that limitation, variously expressed, has been acknowledged repeatedly in the decisions of this Court. In the early, post-Engineers23 authorities, it was expressed in terms of "reservations" from the Engineers principle. The "reservations" evolved into propositions, sometimes treated as discrete principles or elements, that the Commonwealth could not make laws singling out the States by placing special burdens on them, nor could it make laws of general application which would destroy or curtail the continued existence of the States or their capacity to function as governments24. In their joint judgment in Austin, Gaudron, Gummow and Hayne JJ identified "but one limitation" requiring the assessment in any given case of "the impact of particular laws by such criteria as 'special burden' and 'curtailment' of 'capacity' of the States 'to function as governments'"25. These criteria required consideration of the form, substance and actual operation of the relevant federal 22 63 & 64 Vict c 12. 23 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd ("the Engineers Case") (1920) 28 CLR 129; [1920] HCA 54. 24 See for example Re Australian Education Union; Ex parte Victoria ("the AEU Case") (1995) 184 CLR 188 at 231; [1995] HCA 71, referring in fn 211 to Queensland Electricity Commission v The Commonwealth ("the Queensland Electricity Commission Case") (1985) 159 CLR 192 at 217 per Mason J; [1985] HCA 56. 25 (2003) 215 CLR 185 at 249 [124]. law26. They would involve "matters of evaluation and degree and of 'constitutional facts' which are not readily established by objective methods in curial proceedings"27. Kirby J expressed a similar view28. Gleeson CJ, in like vein, put it thus29: "Discrimination is an aspect of a wider principle; and what constitutes relevant and impermissible discrimination is determined by that wider principle." Gleeson CJ referred back to the identification by Mason J in the Queensland Electricity Commission Case30 of the foundation for the implied limitation in the "constitutional conception of the Commonwealth and the States as constituent entities of the federal compact having a continuing existence reflected in a central government and separately organised State governments"31. The identification in Austin of a generally stated implied limitation, variously manifested, is consistent with the origins and evolution of the implication through decisions of this Court after the Engineers Case. In the Engineers Case, the Court held that the Parliaments of the Commonwealth and the States each have the power to enact laws, within their legislative competency, binding on the Commonwealth, the States and the people32. The effect, on specific legislative powers such as taxation, of the words "subject to this Constitution" at the commencement of s 51 was left open. So too was the position of the State prerogative33, although that reservation has since 26 (2003) 215 CLR 185 at 249 [124], referring in fn 155 to the AEU Case (1995) 184 CLR 188 at 240, the Queensland Electricity Commission Case (1985) 159 CLR 192 at 249-250, and Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 500; [1996] HCA 56. 27 (2003) 215 CLR 185 at 249 [124]. 28 (2003) 215 CLR 185 at 301 [281]. 29 (2003) 215 CLR 185 at 217 [24]. 30 (1985) 159 CLR 192 at 218. 31 (2003) 215 CLR 185 at 217 [24]. 32 (1920) 28 CLR 129 at 153-155 per Knox CJ, Isaacs, Rich and Starke JJ. 33 (1920) 28 CLR 129 at 143-144. been eroded34. The Court did not specifically refer to an implied limitation on the legislative powers of the Commonwealth or the States. But as Dixon J was later to point out in West v Commissioner of Taxation (NSW)35, Isaacs J, who delivered the plurality judgment in the Engineers Case, referred in his dissenting judgment in Pirrie v McFarlane36 to the: "natural and fundamental principle that, where by the one Constitution separate and exclusive governmental powers have been allotted to two distinct organisms, neither is intended, in the absence of distinct provision to the contrary, to destroy or weaken the capacity or functions expressly conferred on the other." (emphasis in original) Such destruction or weakening, according to Isaacs J, was prima facie outside the respective grants of power37. The implied limitation was expressed in general terms. So expressed, it was capable of being applied by reference to the attributes and consequences of a Commonwealth law including whether it singled out the States, the nature and extent of the burden which it imposed upon State functions, and the nature of the functions which it burdened. There was never any constitutional imperative to treat as the only elements of the general principle, or as distinct and exhaustive rules, particular ways in which it could be infringed or its infringement ascertained. What Isaacs J said in dissent in Pirrie v McFarlane might have to be considered in the light of the distinction which he made, again in dissent, in the Teachers' Case38 between "the primary and inalienable functions of a constitutional Government", and other functions "voluntarily undertaken by the State, but which are ordinarily or primarily the subject of private individual enterprise". The distinction was rejected by Windeyer J in the Professional Engineers' Case39. A similar distinction between "governmental functions" and 34 See the Queensland Electricity Commission Case (1985) 159 CLR 192 at 213 per Mason J, cited in the AEU Case (1995) 184 CLR 188 at 226 per Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ. 35 (1937) 56 CLR 657 at 682; [1937] HCA 26. 36 (1925) 36 CLR 170 at 191; [1925] HCA 30. 37 (1925) 36 CLR 170 at 191. 38 Federated State School Teachers' Association of Australia v State of Victoria (1929) 41 CLR 569 at 584-585 per Isaacs J; [1929] HCA 11. 39 Ex parte Professional Engineers' Association (1959) 107 CLR 208 at 274-275; [1959] HCA 47. "trading functions" was rejected in the AEU Case40. The rejection of such distinctions makes no difference to the content of the limitation, but rather widens the scope of its application. in a number of cases as requiring a broad The principle emerging from the Engineers Case was formulated by interpretation of Commonwealth legislative power, and an acceptance of the capacity of the Commonwealth to enact legislation affecting States and their agencies41. But no law of the Commonwealth could "impair or affect the Constitution of a State"42. In Farley's Case43, in obiter on the constitutional question, Dixon J referred to the identification in the Engineers Case of the taxation power as one which might come up for special consideration in relation to the States44. And in Essendon Corporation v Criterion Theatres Ltd45 he said that the extent of the taxation power was a third reservation in relation to the principle in the Engineers Case, as he had reformulated it. Nevertheless, the States have no general immunity from the taxation power of the Commonwealth46. State employees or what might broadly be described as "constitutional office holders" do not enjoy such an immunity. The imposition of income tax on the salaries of members of Parliament, State Ministers, and judges does not infringe any implied prohibition. Nor does the imposition of fringe benefits tax in respect of benefits provided to 40 (1995) 184 CLR 188 at 230. A similar distinction, taking as its criterion the traditional governmental functions of the States, was made in National League of Cities v Usery 426 US 833 (1976) but subsequently rejected in Garcia v San Antonio Metropolitan Transit Authority 469 US 528 at 531 (1985). 41 Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 390; [1930] HCA 52; West v Commissioner of Taxation (NSW) (1937) 56 CLR 657 at 682; Federal Commissioner of Taxation v Official Liquidator of E O Farley Ltd ("Farley's Case") (1940) 63 CLR 278 at 316-317; [1940] HCA 13. 42 Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 392 per Dixon J; see also New South Wales v The Commonwealth [No 1] (1932) 46 CLR 155 at 176 per Rich and Dixon JJ; [1932] HCA 7. 43 (1940) 63 CLR 278. 44 (1940) 63 CLR 278 at 316. 45 (1947) 74 CLR 1 at 23; [1947] HCA 15. 46 Victoria v The Commonwealth ("the Payroll Tax Case") (1971) 122 CLR 353 at 374-375 per Barwick CJ, 385 per McTiernan J, 392 per Menzies J, 397-398 per Windeyer J, 408-409 per Walsh J, 423 per Gibbs J; [1971] HCA 16. them by the State. These are laws of general application which do not inhibit the capacity of the States to appoint and remunerate public officers47. In a multifactorial approach to ascertaining whether a law of the Commonwealth infringes the general limitation against laws which destroy or weaken the capacity or functions of the States, the nature and subject matter of the law may be relevant. Thus a law with respect to taxation may be viewed differently from a law with respect to defence. As was said in the joint judgment "Special considerations arise where it is the reach of the federal legislative power with respect to taxation that is in question." One such consideration was "the lack of ingenuity needed to burden the exercise of State functions by use of the taxation power"49. By way of comparison, laws with respect to "the naval and military defence of the Commonwealth and of the several States"50 involve the protection of all polities making up the federation. The Court's decision in the First Uniform Tax Case51 suggests that the limitation, which was there propounded in terms of discrimination, had little purchase on the defence power at the time. The Court upheld legislation authorising the temporary transfer from the States to the Commonwealth public service of officers concerned with the assessment and collection of State income tax. Consistently with the broad approach interpretation of the Engineers Case, a Commonwealth Commonwealth bankruptcy law under which a court ordered a weekly contribution to creditors out of a bankrupt State parliamentarian's allowances survived scrutiny in Stuart-Robertson v Lloyd52. It did so on the basis that it did legislative power enunciated the 47 State Chamber of Commerce and Industry v The Commonwealth (The Second Fringe Benefits Tax Case) (1987) 163 CLR 329 at 356 per Mason CJ, Wilson, Dawson, Toohey and Gaudron JJ; [1987] HCA 38. 48 (2003) 215 CLR 185 at 256 [140]. 49 (2003) 215 CLR 185 at 257 [142], referring to Melbourne Corporation v The Commonwealth ("the Melbourne Corporation Case") (1947) 74 CLR 31 at 80 per Dixon J; [1947] HCA 26. 50 Constitution, s 51(vi). 51 South Australia v The Commonwealth (1942) 65 CLR 373; [1942] HCA 14. 52 (1932) 47 CLR 482; [1932] HCA 33. not impose any burden upon legislators as such53. It was unnecessary to consider how much further the power of the Commonwealth Parliament could have extended54. The law was evidently, although not expressly, upheld on the basis that it was a law of general application and did not interfere with governmental functions. A submission to the contrary was made and implicitly rejected55. Although characterisation was sufficient in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Victoria56 to invalidate regulations purporting to control the conditions of Victorian public servants not engaged in war-related work, Starke J foreshadowed a formulation of the limitation in terms of laws "singling out the States"57. While he did not use that expression, he said that the Engineers Case was not authority for the general proposition that the States were subject "as such" to the legislation of the Commonwealth58. It was primarily the character of the law under challenge in the Melbourne Corporation Case as "singling out another government and specifically legislating about it"59 that led to its invalidation. The law prohibited banks from dealing with States or their authorities without written consent from the Treasurer. Latham CJ relied upon its characterisation as a law with respect to State government functions, which did not fall within any head of Commonwealth power60. Rich J, on the other hand, held it invalid because it impaired the powers of the States, essential to the effective working of their governments, to freely use banking functions61. Starke J saw it as "a practical 53 (1932) 47 CLR 482 at 488 per Gavan Duffy CJ and Dixon J. 54 (1932) 47 CLR 482 at 488 per Gavan Duffy CJ and Dixon J, 488 per Rich J, 491- 492 per Evatt J, 496 per McTiernan J. 55 (1932) 47 CLR 482 at 485 per Loxton KC for the appellant, see at 488 per Gavan Duffy CJ and Dixon J, 491-492 per Evatt J. 56 (1942) 66 CLR 488 at 506-507 per Latham CJ, 513 per Starke J, 533 per Williams J (Rich J agreeing at 510); [1942] HCA 39. 57 (1942) 66 CLR 488 at 513 and 515. 58 (1942) 66 CLR 488 at 515. 59 (1947) 74 CLR 31 at 61 per Latham CJ, see also at 66 per Rich J, 81 per Dixon J, 60 (1947) 74 CLR 31 at 61. 61 (1947) 74 CLR 31 at 67. question" whether legislation or executive action by the Commonwealth destroyed, curtailed or interfered with the operations of a State. He said62: "No doubt the nature and extent of the activity affected must be considered and also whether the interference is or is not discriminatory but in the end the question must be whether the legislation or the executive action curtails or interferes in a substantial manner with the exercise of constitutional power by the other." One question was posed, and one principle applied. Dixon J relied upon the character of the statutory prohibition as one which was "directed to control or restrict" the States63. In that respect it fell within a reservation to his previously repeated restatement of the principle in the Engineers Case. That reservation was related to64: "the use of federal legislative power to make, not a general law which governs all alike who come within the area of its operation whether they are subjects of the Crown or the agents of the Crown in right of a State, but a law which discriminates against States, or a law which places a particular disability or burden upon an operation or activity of a State, and more especially upon the execution of its constitutional powers." (emphasis added) The second disjunctive limb, relating to a law which places "particular disability or burden" upon an operation or activity of a State, on its face extended to general laws but was expressed widely enough to pick up "discriminatory" laws singling out the States. Williams J held the law to be invalid on similar grounds, describing it as legislation which clearly discriminated against the States and their agencies65. Characterisation is anterior to the application of the implied limitation to a Commonwealth law affecting the States or their agencies. But consideration of the two questions may overlap. The approach adopted by Latham CJ in the Melbourne Corporation Case demonstrated that kind of overlap. In the Professional Engineers' Case66, Dixon CJ in considering the scope of s 51(xxxv) 62 (1947) 74 CLR 31 at 75. 63 (1947) 74 CLR 31 at 85. 64 (1947) 74 CLR 31 at 78-79. 65 (1947) 74 CLR 31 at 99. 66 (1959) 107 CLR 208 at 233. of the Constitution referred to the "inapplicability of the federal industrial power to the administrative services of the States notwithstanding the interpretation placed upon it in the Engineers Case". Barwick CJ, McTiernan and Owen JJ upheld the Pay-roll Tax Act 1941 (Cth) upon characterisation grounds in the Payroll Tax Case67. Rather than relying upon an implication, their Honours took the view that the Constitution did not give the Commonwealth legislative power over the States or their powers and functions of government as subject matters of legislation. In R v Coldham; Ex parte Australian Social Welfare Union68, the Court found that the reasons for the conclusion in the Professional Engineers' Case that federal industrial power was inapplicable to the administrative services of the State were no longer fully acceptable. Nevertheless, that conclusion, which had been based on characterisation, might be supportable by reference to the prefatory words of s 51 whereby the power is made "subject to this Constitution"69: "The implications which are necessarily drawn from the federal structure of the Constitution itself impose certain limitations on the legislative power of the Commonwealth to enact laws which affect the States (and vice versa)." The Court observed that the nature of the limitation had been discussed in the Melbourne Corporation Case and in the Payroll Tax Case. Their Honours agreed70 with the observation of Walsh J in the Payroll Tax Case71 that "the limitations … have not been completely and precisely formulated". It was the imposition of a special burden or disability on a State or its agencies not imposed on persons generally which spelt invalidity for the law under challenge in the Queensland Electricity Commission Case. Nevertheless, Gibbs CJ referred to "two distinct rules, each based on the same principle, but dealing separately with general and discriminatory laws"72. The two rules were73: 67 (1971) 122 CLR 353 at 372 per Barwick CJ (Owen J agreeing at 405), 385-386 per 68 (1983) 153 CLR 297; [1983] HCA 19. 69 (1983) 153 CLR 297 at 313. 70 (1983) 153 CLR 297 at 313. 71 (1971) 122 CLR 353 at 410. 72 (1985) 159 CLR 192 at 206. 73 (1985) 159 CLR 192 at 206. "A general law, made within an enumerated power of the Commonwealth, will be invalid if it would prevent a State from continuing to exist and function as such … A Commonwealth law will also be invalid if it discriminates against the States in the sense that it imposes some special burden or disability on them." Mason J referred back to the formulation of the principle by Dixon J in the Melbourne Corporation Case74, quoted above75. He identified "two elements" of the "now well established" principle, namely76: "(1) the prohibition against discrimination which involves the placing on the States of special burdens or disabilities; and (2) the prohibition against laws of general application which operate to destroy or curtail the continued existence of the States or their capacity to function as governments". The identification of the two elements did not negate the existence of a general principle of which they were expressions. It did not inhibit the application of that general principle to the variety of circumstances which might call for its consideration. In the event, Mason J focussed upon the discriminatory character of the impugned law77. Brennan J took a similar approach but noted that a general law may operate in the context of particular circumstances to single out States for discriminatory treatment78. Deane J said79: "The character of a law as a law of general application is ordinarily a factor, and sometimes a conclusive factor, militating against the conclusion that it discriminates against the States or a State in the relevant sense. The question whether a law does so discriminate … is however, for the purposes of the law of the Constitution, a question of substance which is not susceptible of being resolved by the mere inquiry whether, as a matter of form, the law is a general or a special one." 74 (1947) 74 CLR 31 at 79. 75 (1985) 159 CLR 192 at 214, see [24] above. 76 (1985) 159 CLR 192 at 217. 77 (1985) 159 CLR 192 at 221. 78 See (1985) 159 CLR 192 at 243. 79 (1985) 159 CLR 192 at 249. To the extent that this approach sought to frame the implication within an extended concept of discrimination, including operational discrimination, it would seem to have been unnecessarily restrictive. However, even within the rubric of laws "discriminating against the States", it illustrated a flexible and multifactorial approach to determining whether a law impermissibly burdens the States or a particular State. Importantly, Brennan J made the point in the Queensland Electricity Commission Case that80: "It would state the implication too widely to say simply that the Commonwealth is prohibited from making any discriminatory law which involves the placing on the States of special burdens or disabilities affecting the exercise of their powers. It is not consistent with the plenary nature of the powers of the Commonwealth to deny the validity of a the discriminatory discrimination." law enacted under a power which supports He drew attention to a similar observation made by Mason J in Victoria v Australian Building Construction Employees' and Builders Labourers' Federation81. What Brennan J said in this respect was cited in the joint judgment in Austin82. It requires that attention be directed to the discriminatory character of the law as a relevant but not determinative factor in assessing whether the law trespasses beyond constitutional boundaries in its effect upon the States. The joint judgment in the AEU Case acknowledged that, while the comments of Dixon J in the Melbourne Corporation Case were couched principally in terms of discrimination against the States and the imposition of a particular disability or burden upon the operation or activities of the States or upon the exercise of their constitutional powers, "his Honour clearly had in mind … that the legislative powers of the Commonwealth cannot be exercised to destroy or curtail the existence of the States or their continuing to function as such"83. Nevertheless the joint judgment left open the question whether there are two implied limitations, two elements or branches of one limitation, or simply one limitation84. That question was answered in favour of one limitation by a majority of the Court in Austin. 80 (1985) 159 CLR 192 at 233. 81 (1982) 152 CLR 25 at 93. 82 (2003) 215 CLR 185 at 256 [139]. (1995) 184 CLR 188 at 227. 84 (1995) 184 CLR 188 at 227. In Austin, the Court held that the CPSF Assessment Act and the CPSF Imposition Act were invalid in their application to the statutory pension entitlements of a judge of the Supreme Court of New South Wales. But for invalidity, a judge would have been liable to pay a surcharge calculated on "the amounts that constitute the actuarial value of the benefits that accrued to, and the value of the administration expenses and risk benefits provided in respect of, the member for the financial year"85. Gleeson CJ based his decision upon the difference in the treatment of the State judge under the CPSF Assessment Act and other high-income earners. He said86: "That differential treatment is constitutionally impermissible, not because of any financial burden it imposes upon the States, but because of its interference with arrangements made by States for the remuneration of their judges." Gaudron, Gummow and Hayne JJ referred to the significance of the provision of secure judicial remuneration in attracting persons to accept appointment as judicial officers87. They referred to the selection of State judicial officers for attention by the federal legislature as "high-income members" of non- contributory unfunded schemes88 and said that differential treatment may be indicative of infringement of the limitation upon legislative power with which the doctrine in the Melbourne Corporation Case is concerned, but was "not, of itself, sufficient to imperil validity"89. The question upon which their Honours focussed was the significance of the impairment of the exercise by the State of its freedom to select the manner and method for discharge of its constitutional functions respecting the remuneration of the judges of the courts of the State. That significance was to be taken to be "considerable"90. Their Honours then asked 85 CPSF Assessment Act, s 9(4). 86 (2003) 215 CLR 185 at 219 [28]. 87 (2003) 215 CLR 185 at 262-263 [159]-[160]. 88 (2003) 215 CLR 185 at 263 [162]. 89 (2003) 215 CLR 185 at 264 [164]. 90 (2003) 215 CLR 185 at 264 [165]. the "practical question" identified by Starke J in the Melbourne Corporation Case91, which they formulated as follows92: "This, in the end, is whether, looking to the substance and operation of the federal laws, there has been, in a significant manner, a curtailment or interference with the exercise of State constitutional power." The effect upon the State of the law was indicated by its move to vary the method of judicial remuneration by legislating to offset the impact of the surcharge93: "The liberty of action of the State in these matters, that being an element of the working of its governmental structure, thereby is impaired." Gaudron, Gummow and Hayne JJ expressed their conclusion thus94: "[I]n its application to the first plaintiff, the [CPSF Imposition Act] and the [CPSF Assessment Act] are invalid on the ground of the particular disability or burden placed upon the operations and activities of New South Wales." The constitutional implication considered in Austin and its precursors means that the Commonwealth cannot, by the exercise of its legislative power, significantly impair, curtail or weaken the capacity of the States to exercise their constitutional powers and functions (be they legislative, executive or judicial) or significantly impair, curtail or weaken the actual exercise of those powers or functions. The Constitution assumes the existence of the States as "independent entities". This implies recognition of the importance of their status as components of the federation. The "significance" of a Commonwealth law affecting the States' functions is not solely to be determined by reference to its practical effects on those functions. This is not a return to any generalised concept of inter-governmental immunity. It simply recognises that there may be some species of Commonwealth laws which would represent such an intrusion upon the functions or powers of the States as to be inconsistent with the constitutional assumption about their status as independent entities. 91 (1947) 74 CLR 31 at 75. 92 (2003) 215 CLR 185 at 265 [168]. 93 (2003) 215 CLR 185 at 265 [170]. 94 (2003) 215 CLR 185 at 267 [174]. The application of the implied limitation is evaluative. It has always been thus. There is a normative element in the criterion of "significance" by which the adverse effects of a Commonwealth law on State capacities or functions must be characterised, before such a law will be held to be invalid. Whether the effects of a law upon the capacities or functions of the States are "significant" is to be judged qualitatively and also, but not only, by reference to its practical effects. To take an extreme example, a law of the Commonwealth purporting to subject the Governor of each of the States to a special "gubernatorial privileges tax" might fix the tax at a level which, in a financial sense, would be of little practical importance to the States or to their Governors. It might be thought, nevertheless, that the nature of such a law would mark it as asserting an intrusive legislative authority with respect to the constitutional office of Governor that was inconsistent with the status of the States as independent entities under the Constitution. In my opinion, the application of the implied limitation requires a multifactorial assessment. Factors relevant to its application include: 1. Whether the law in question singles out one or more of the States and imposes a special burden or disability on them which is not imposed on persons generally. 2. Whether the operation of a law of general application imposes a particular burden or disability on the States. The effect of the law upon the capacity of the States to exercise their constitutional powers. The effect of the law upon the exercise of their functions by the States. The nature of the capacity or functions affected. The subject matter of the law affecting the State or States and in particular the extent to which the constitutional head of power under which the law is made authorises its discriminatory application. None of these factors, considered separately, will necessarily be determinative of the application of the limitation. The decisions of this Court indicate that the fact that a law singles out the States or a State will be of considerable significance, to be weighed together with the effects of such a law on their capacities and functions. The fact that a law is of general application may make it more difficult to demonstrate, absent operational discrimination in its impact upon the States, that it transgresses the limitation. In the present case, the factors relevant to the validity of the CPSF Assessment and Imposition Acts in their application to members of the South Australian Parliament are: The State is singled out by reference to benefits and funds established by State laws which are specifically designated by the Commonwealth laws. The laws, in so far as they relate to the PS Scheme, impose a tax specifically upon persons holding office as members of the Parliament of the State. laws effectively and specifically burden The the pension and superannuation benefits able to be enjoyed by members of the State Parliament. Unlike income tax laws and other tax laws of general application, the impugned laws are specifically aimed at the remuneration arrangements between the State and members of its legislature. The significance of the effects of the surcharge upon State legislators was reasonably evidenced by the amendment which the State made to the commutation superannuation entitlements. provisions affecting pension and In my opinion, when these factors are taken together, the CPSF Assessment and Imposition Acts, read with their specific application to funds designated in reg 177 of the Income Tax Regulations 1936 (Cth), significantly interfered with the remuneration arrangements made between the State and its legislators and, to that extent, significantly burdened the exercise by the State of its powers and functions in fixing the remuneration of its legislators. As to the effect of the laws upon Mr Clarke's entitlement to benefit under the SSS Scheme and the State Superannuation Benefit Scheme, I agree, for the reasons expressed by Hayne J95, that they are invalid in their application to those Schemes. Conclusion For the preceding reasons, in my opinion, the appeal should be allowed and question 3(a) should be answered in the affirmative. I agree with the orders proposed in the joint judgment. 95 See at [91]-[92] and [97]-[105] below. Bell GUMMOW, HEYDON, KIEFEL AND BELL JJ. This appeal from the Full Court of the Federal Court (Branson, Sundberg and Dowsett JJ)96 is a sequel to Austin v The Commonwealth97. In that decision this Court held invalid two laws of the Commonwealth in their application to Justice Austin of the Supreme Court of New South Wales, on the ground that they placed a particular disability or burden upon the operations or activities of the State of New South Wales so as to be beyond the legislative power of the Commonwealth98. The laws in question are the Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Imposition Act 1997 (Cth) ("the Imposition Act") and the Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997 (Cth) ("the Assessment Act"). They commenced on 7 December 1997 and have been amended. The legislation received detailed treatment in Austin99 and what follows should be read with an appreciation of that earlier analysis. In broad terms, the legislation imposed a new tax, called a "surcharge"100, upon contributions actually or notionally paid for the provision of retirement benefits to a class of persons including the appellant. The appellant complains that, as a former member of the South Australian legislature, he is subjected in a constitutionally impermissible manner to a special and legally different taxation regime from that applicable to persons eligible for, or in receipt of, pensions or superannuation. In this Court, the second respondent, the Attorney-General for South Australia, supported the appellant, as did the intervening Attorneys-General for New South Wales, Victoria, Queensland and Western Australia. The Commonwealth Attorney-General intervened in support of the first respondent ("the Commissioner") and the Commissioner adopted the submissions of the Attorney-General. 96 Clarke v Federal Commissioner of Taxation (2008) 170 FCR 473. 97 (2003) 215 CLR 185; [2003] HCA 3. 98 (2003) 215 CLR 185 at 314-316. 99 (2003) 215 CLR 185 at 233-245 [68]-[110]. 100 See Austin (2003) 215 CLR 185 at 232 [64]. Bell The appellant's parliamentary superannuation The Constitution Act 1934 (SA) provides that the Parliament of South Australia comprises the Legislative Council and the House of Assembly (s 4). In the period in which the appellant was a member of the House of Assembly it consisted of 47 members elected by the inhabitants of the State legally qualified to vote (s 27). The Parliamentary Remuneration Act 1990 (SA) ("the Remuneration Act") conferred authority for payment from the Consolidated Account of amounts of remuneration fixed under that statute (s 6). The Consolidated Account is one of the most important of the ledger accounts maintained at the Treasury101. The "basic salary" of a member of the Parliament was fixed by s 3 as an annual salary at a rate equal to $2,000 less than that from time to time payable to members of the House of Representatives as "Commonwealth basic salary". The appellant was a member of the House of Assembly between 1993 and 2002. During part of that period he was Deputy Leader of the Opposition, an office which attracted additional salary under s 4(1)(b) of the Remuneration Act. The appellant was a member of three superannuation schemes established by statutes of South Australia. The most significant of these for the financial position of the appellant was the Parliamentary Superannuation Scheme ("the PSS"). This was established by the Parliamentary Superannuation Act 1948 (SA) and continued by the Parliamentary Superannuation Act 1974 (SA) ("the PSS Act"). The PSS Act was amended from time to time during the period in which the appellant served in the House of Assembly, in particular by the Parliamentary Superannuation (Establishment of Fund) Amendment Act 1999 (SA) ("the 1999 Act"). It will be sufficient to refer to the statute as in force as at 1 January 2002102. Section 8 of the PSS Act established the South Australian Parliamentary Superannuation Board ("the Board") and s 12 obliged it to submit a report each year to the Treasurer on the operation of the Act. The PSS Act defined (s 5(1)) a "member" as a member of either House of Parliament of the State, and included those former members still in receipt of a salary. As a member, the appellant was obliged by s 14 of the PSS Act to contribute 11.5 per cent of his salary which was deducted by the Treasurer from 101 Selway, The Constitution of South Australia, (1997) at 134. 102 Reprint No 9. Bell his salary. Upon the appellant ceasing to be a member of the House of Assembly on 8 February 2002 by reason of the loss of his seat at an election, and having had not less than six years service, he became entitled for life, pursuant to s 16 of that statute, to a pension of about 43 per cent of his final salary. He continues to receive that pension. There was a limited right of commutation under s 21 of a proportion of the pension which had to be exercised by the appellant within three months of the loss of his seat. The appellant did not exercise that right. The pension may not be assigned or charged and cannot pass by operation of law (s 38). Were the appellant to be re-elected in the future his pension would cease, but his previous service would again be taken into account for subsequent pension entitlement (s 20). Section 39(1) states that the money required for the purposes of the PSS Act is payable by the Treasurer from the Consolidated Account or from a special deposit account established by the Treasurer for that purpose. Since the amendments made by the 1999 Act, benefits have been paid from the Parliamentary Superannuation Fund established by s 13 of the PSS Act. The assets of the fund belong, at law and in equity, to the Crown in right of the State (s 13(2)). The fund receives from the Treasurer payments equal to member contributions (s 13(4)(a)); the Treasury may charge the fund with the amount of benefits which are paid and thereby reimburse the Consolidated Account or other special deposit account (s 39(2)). The particulars of the other two superannuation schemes of which the appellant was a member appear later in these reasons under the heading "The other schemes". The Imposition Act and the Assessment Act Section 5 of the Assessment Act states: "The object of this Act is to provide for the assessment and collection of the superannuation contributions surcharge payable on surchargeable contributions for high-income members of constitutionally protected superannuation funds." In the Second Reading Speech on the Bill for the Assessment Act the responsible Minister said103: 103 Australia, House of Representatives, Parliamentary Debates (Hansard), 2 October Bell "The surcharge liability for a member for a year will be accumulated in a surcharge debt account, maintained by the Commissioner of Taxation, for the member and will be payable by the member when the member's superannuation benefit becomes payable. The member will have the option of paying off the debt as it arises once an amount of surcharge has been assessed." The Full Court gave a summary of the principal provisions of the federal legislation as follows104: "Section 4 of the [Imposition Act] imposed the surcharge 'on a member's surchargeable contributions for a financial year ...'. Section 11 of the [Assessment Act] provided that the relevant member, and not the fund trustee or manager, was liable to pay the surcharge. Section 8(1) of the [Assessment Act] provided that the surcharge was payable on 'a member's surchargeable contributions' for a relevant financial year, subject to presently irrelevant exceptions identified in s 8(2) and (3). The term 'member' was defined in s 38 of the [Assessment Act] to mean 'a member of a constitutionally protected superannuation fund and includes a person who has been a member of such a fund'. ... Section 9 defined the term 'surchargeable contribution'. In so doing it distinguished between two different kinds of superannuation scheme, defined benefits superannuation schemes and others to which we will refer as 'accumulation schemes'. Section 9(2) and (3) dealt with the latter category, while subss (4), (5) and (6) dealt with the former. Section 9(2) and (4) were the primary provisions. The reason for the distinction lay in the purpose of the legislative scheme, namely to tax superannuation benefits as they accrued. In accumulation schemes such benefits resulted from periodic payments made by employers, employees or both. The desired tax result could be achieved by taxing the amounts so paid. To avoid the problem [presented by s 114 of the Constitution] of taxing State funds, the surcharge was imposed on the relevant office-holders or employees. However some defined benefits schemes could not be so treated. It was decided to tax a potential beneficiary under a defined benefits scheme upon an actuarial valuation of the extent to which the anticipated ultimate benefit under the scheme was attributable to the beneficiary's service during the relevant year. That approach necessarily 104 (2008) 170 FCR 473 at 477. Bell started with identification of the ultimate benefit. That benefit was generally tied to the relevant beneficiary's salary at, or prior to, the termination of his or her employment." The PSS was an "unfunded defined benefits superannuation scheme"105 and was a "constitutionally protected superannuation fund"106 for the periods for which the Commissioner issued the assessments of surcharge described below. Of the legislative purpose in the Assessment Act, it was said in the joint reasons in Austin107: "The objective here is to create, or at least to identify, by the notion of a member of a constitutionally protected superannuation fund, a class of taxpayers and a 'subject of taxation' within the meaning of s 55 of the Constitution. References already made to the provisions in the second half of s 9 dealing with the 'notional surchargeable contributions factor' indicate that the legislature had in mind the imposition of taxation partly by reference to notional or fictional constructs." The litigation Section 15(6) of the Assessment Act, in the form in which it applies to the appellant, provides that when a lump sum or pension becomes payable for a member whose "surcharge debt account" is in debit, the member is liable to pay the Commissioner the lesser of the amount of the debit and 15 per cent of the employer-financed component of that part of the benefits which accrued after 20 August 1996. Between 15 February 2000 and 15 February 2005 the Commissioner issued to the appellant assessments of superannuation contributions surcharge in respect of his membership of each of the three superannuation schemes. On 16 August 2004, under s 15(7) of the Assessment Act, the Commissioner issued to the appellant a notice of liability to pay surcharge in respect of his membership of the PSS. Surchargeable contributions under the PSS for the periods ending 30 June 1997–30 June 2001 had been reported in a total of $181,402 and the 105 Superannuation Contributions Tax (Assessment and Collection) Regulations 1997 (Cth), Sched 1, Pt 1, Item 173. 106 Income Tax Regulations (Amendment) (Cth) SR 1997 No 191. 107 (2003) 215 CLR 185 at 242 [99]. Bell "surcharge rate" was 15 per cent. A surcharge amount was included in the taxable income of the appellant for each of these five years. Some 93 per cent of the surchargeable contributions were calculated in respect of membership of the PSS, with the result that of the assessed surcharge of $29,260 approximately $27,210 was imposed in respect of the PSS membership of the appellant. Objections by the appellant, based upon the application to his position of the reasoning and outcome in Austin, were disallowed by the Commissioner. The appellant applied to the Administrative Appeals Tribunal ("the AAT") for review of those decisions of the Commissioner. The AAT then referred three questions to the Federal Court. These were argued before the Full Court which answered the two limbs of Question 3 adversely to the interests of the appellant. The Full Court, consistently with the decision in Austin, answered "No" to Question 3(b)108. This asked whether the Imposition Act imposed a tax on property belonging to a State, contrary to s 114 of the Constitution. In this Court the appellant confines his case to the treatment by the Full Court of Question 3(a). The Full Court answered "No" to the question whether the Imposition Act and the Assessment Act are invalid in their application to the appellant on the ground that they so discriminate against the State of South Australia, or so place a particular disability or burden upon the operations and activities of that State, as to be beyond the legislative power of the Commonwealth. For the reasons that follow, together with those of Hayne J, the appellant should succeed in respect of liability to pay surcharge by reason of his membership of the PSS and of the other two schemes. The Melbourne Corporation doctrine The appellant, and the States of South Australia, New South Wales, Victoria, Queensland and Western Australia in his support, rely upon that implication, derived from the federal structure established by the Constitution and consistent with its express terms, which is associated with Melbourne Corporation v The Commonwealth109 and has been elucidated in later authorities, of which Austin is the most recent. The effect of the implication for which the 108 (2008) 170 FCR 473 at 504. 109 (1947) 74 CLR 31; [1947] HCA 26. Bell appellant and his supporters contend is to restrain, in addition to the express limitation in s 114 of the Constitution, the scope of the power of the Parliament to make laws with respect to "taxation; but so as not to discriminate between States or parts of States" (s 51(ii)). Six points may conveniently be made here. The first concerns the emphasis placed in Austin110 upon both the reference in s 5 of the Assessment Act to "high-income members of constitutionally protected superannuation funds" and the different taxation regime applicable to other superannuation funds as indicative that the Imposition Act and the Assessment Act are not laws of "general application" which the States must take as they find them as part of the system governing the whole community111. In Austin112 Gleeson CJ pointed out, as instances of federal laws of "general application" that validly had been imposed on the States, along with taxpayers generally, pay-roll tax and fringe benefits tax. The second point is that members of a State legislature are within that class of persons "at the higher levels of government" in respect of whom it is critical to the State's capacity to function as a government that it retain the ability to fix the terms and conditions under which they serve upon election to the Parliament of the State in question113. The third concerns the significance of the size of any financial burden. In that regard the following remarks of Gleeson CJ in Austin are in point114: "The adverse financial impact on the States of the pay-roll tax, or the fringe benefits tax, both of which were held valid, far exceeded the financial consequences of the laws held invalid in Melbourne Corporation or Queensland Electricity Commission. It was the disabling effect on State authority that was the essence of the invalidity in those cases. It is 110 (2003) 215 CLR 185 at 263 [162]. 111 See Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 337-338 per Dixon J; [1948] HCA 7. 112 (2003) 215 CLR 185 at 210-211 [16]. See also Stuart-Robertson v Lloyd (1932) 47 CLR 482 at 488, 491-492; [1932] HCA 33. 113 See Austin (2003) 215 CLR 185 at 260-261 [152]. 114 (2003) 215 CLR 185 at 217 [24]. Bell the impairment of constitutional status, and interference with capacity to function as a government, rather than the imposition of a financial burden, that is at the heart of the matter, although there may be cases where the imposition of a financial burden has a broader significance." The fourth point is a corollary to the third. The governmental capacities of the States, for example with respect to the terms and conditions under which parliamentarians serve, often will be manifested in legislation. But this will not always be so. The Melbourne Corporation Case immediately concerned the effect of the Banking Act 1945 (Cth) upon the freedom of the plaintiff to continue to bank with the National Bank of Australasia Ltd, a private bank, rather than with the Commonwealth Bank of Australia115. The more general consideration, emphasised by Dixon J116, was that State and federal governments being separate bodies politic, "prima facie each controls its own moneys". Further, where there is State legislation, as in the present case, this does not entail the consequence that the question of the application of the Melbourne Corporation doctrine as a restraint upon federal legislative power is to be determined by the methods of comparison between federal and State laws enacted under concurrent powers but said to attract the operation of s 109 of the Constitution. The issue in this appeal concerns alleged federal legislative impairment of the relevant capacity of the State of South Australia. The fifth point is that in Austin, a majority of the Court, Gleeson CJ117 and Gaudron, Gummow and Hayne JJ118, concluded the notion of "discrimination" by federal law against a State is but an illustration of a law which impairs the capacity of the State to function in accordance with the constitutional conception of the Commonwealth and States as constituent entities of the federal structure. Too intense a concern with identification of discrimination as a necessity to attract the Melbourne Corporation doctrine involves the search for the appropriate comparator, which can be a difficult inquiry119 and is apt to confuse, rather than to focus upon the answering of the that 115 See (1947) 74 CLR 31 at 32-34, 68. 116 (1947) 74 CLR 31 at 77. 117 (2003) 215 CLR 185 at 217 [24]. 118 (2003) 215 CLR 185 at 246-249 [116]-[124]. 119 See, for example, the differing identification of the relevant comparator for the legislation considered in Purvis v New South Wales (2003) 217 CLR 92 at 130-131 [113]-[118], 158-161 [213]-[224]; [2003] HCA 62. Bell essential question of interference with or impairment of State functions. It also may be that the references to discrimination by Dixon J in Melbourne Corporation120 use the term in the somewhat different sense of a law which is "aimed at" or places a "special burden" on the States. This leads to the final point, which indicates the nature of the inquiry for the present appeal. It was made as follows in the joint reasons in Austin121: "There is, in our view, but one limitation, though the apparent expression of it varies with the form of the legislation under consideration. The question presented by the doctrine in any given case requires assessment of the impact of particular laws by such criteria as 'special burden' and 'curtailment' of 'capacity' of the States 'to function as governments'. These criteria are to be applied by consideration not only of the form but also 'the substance and actual operation' of the federal law122. Further, this inquiry inevitably turns upon matters of evaluation and degree and of 'constitutional facts' which are not readily established by objective methods in curial proceedings." Conclusions respecting the PSS The practical operation of the Imposition Act and the Assessment Act with respect to State parliamentarians, as much as to State judges in the position of Justice Austin, is to create an obligation on their part to pay a deferred compounding tax when leaving office. An occasion for the imposition of that obligation upon the appellant was his membership of the PSS, which was an incident of his service as a member of the House of Assembly. The tax which is assessed and imposed by the federal legislation upon the appellant, as upon Justice Austin, is based upon notional contributions and these are determined by actuarial calculations. The result is that the notional contributions upon which the appellant has been assessed bear no necessary relation to the pension he receives. Assumptions as to salary increases, increases 120 (1947) 74 CLR 31 at 81, 83, 84. 121 (2003) 215 CLR 185 at 249 [124]. 122 Re Australian Education Union; Ex parte Victoria (1995) 184 CLR 188 at 240; [1995] HCA 71; Queensland Electricity Commission v The Commonwealth (1985) 159 CLR 192 at 249-250; [1985] HCA 56; Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 500; [1996] HCA 56. Bell in the Consumer Price Index, marital status upon retirement, likely commutation and mortality may reflect "average" experience of members of the PSS without being accurate in their application to the appellant. The result, as New South Wales submitted, is that benefits actually received may be less than those assumed in the actuarial calculations. Moreover, the tax accrues, compounding at market interest rates, until the defined benefit is received, and may approximate the whole of the pension paid under the PSS for the first year. It may be accepted that some of the considerations present in Austin do not apply to the appellant. In particular, there is the absence of judicial tenure and the requirement for continued electoral success. But the interest of the State in attracting, by the making of suitable remuneration, competent persons to serve as legislators, and thus as potential Ministers, is a long-standing constitutional value. The matter was considered by this Court in Theophanous v The Commonwealth123 where reference was made to the remuneration, before Federation, of members of the colonial legislatures. The fixing of the amount and terms of that remuneration is a critical aspect of the capacity of a State to conduct the parliamentary form of government. Numerous provisions of the Constitution124 assume the continued operation of that form of government in the States. responded the Statutes Amendment Section 21 of the PSS Act permitted partial commutation but this was likely to produce a lump sum less than the present value of the pension entitlement. To the federal laws introduced in 1997, the Parliament of South for Australia Superannuation Surcharge) Act 1999 (SA) ("the Commutation Act"), s 4 of which introduced s 21AA of the PSS Act. This obliged the Board, on application of a member liable under s 15(6) of the Assessment Act to a deferred superannuation contribution surcharge, to "commute so much of the pension as is required to provide a lump sum equivalent to the amount of the surcharge". The application had to be made not within three months of leaving the Parliament, but within three months of the receipt of the notice by the Commissioner under s 15(7) of the Assessment Act (s 21AA(2)). (Commutation The Second Reading Speech in the House of Assembly on the Bill for the 1999 Act indicates the legislative purpose of assisting members who might 123 (2006) 225 CLR 101 at 113-114 [7], 119-121 [33]-[37]; [2006] HCA 18. 124 Including ss 7, 9, 10, 15, 25, 29, 30, 31, 41, 95, 107, 108, 111, 123 and 124. Bell otherwise lack the means to meet the deferred surcharge liability, the final amount of which might not be known until the due date for payment was past125. The Full Court said of the enactment of s 21AA that the State "was not compelled by the surcharge legislation to make the amendment" and that s 21AA was "a piece of fine tuning"126. However, the introduction of that provision had a greater significance. It was indicative of the curtailment or restriction of legislative choice for South Australia to provide remuneration to senior office holders. The appellant entered the Parliament under a system provided by the PSS. This provided a life pension after at least six years of service, with a limited right of commutation under s 21. The practical operation of the Assessment Act and the Imposition Act was to curtail the continued exercise of State legislative choice, as expressed in the PSS. The introduction of s 21AA was responsive to and indicative of that curtailment. As Hayne J explains in his reasons, the State was left with no real choice but to provide retirement benefits by a method which enabled parliamentarians to meet the burden imposed by the surcharge legislation. The Commonwealth Solicitor-General submitted, with respect to the PSS Act, that the basic question was (i) whether the liability to pay the surcharge created a substantial disincentive to take, stand for, or continue in parliamentary office and (ii) if so, whether there was thereby a significant impairment of the ability of the State of South Australia to attract and retain appropriate people as parliamentarians. This frames the basic question too narrowly. Reference has been made earlier in these reasons to the interest of the State in attracting competent persons to serve as legislators. This supports the proposition that the capacity to fix the amount and terms of remuneration of parliamentarians is a critical aspect of the conduct of the parliamentary form of government by the State. To adapt what was said in the joint reasons in Austin127, one tendency of the federal laws in question here is to induce the States to vary their method of remuneration of members of the legislatures, and: 125 South Australia, House of Assembly, Parliamentary Debates (Hansard), 9 March 126 (2008) 170 FCR 473 at 503. 127 (2003) 215 CLR 185 at 265 [170]. Bell "The liberty of action of the State in these matters, that being an element of the working of its governmental structure, thereby is impaired. No doubt there is no direct legal obligation imposed by the federal laws requiring such action by the State. But those laws are effectual to do so, as was the Banking Act [1945 (Cth)]." With respect to that statute, in Austin their Honours had earlier posed the practical question put by Starke J in the Melbourne Corporation Case128. This was129: "whether, looking to the substance and operation of the federal laws, there has been, in a significant manner, a curtailment or interference with the exercise of State constitutional power". The answer with respect to this appeal, as with Austin, is in the affirmative, at least as regards the operation of the PSS. The other schemes The surcharge liabilities of the appellant which arose under s 15(6) of the Assessment Act included assessments for 1997 and 1998 in respect of his membership of the State Superannuation Benefit Scheme ("the SBS"), and for 1999, 2000 and 2001 in respect of his membership of the Southern State Superannuation Scheme ("the Southern Scheme"). The first of these was established under the Superannuation (Benefit Scheme) Act 1992 (SA) ("the SBS Act") and the other under the Southern State Superannuation Act 1994 (SA) ("the Southern Scheme Act"). The SBS Act was repealed with effect 1 July 1998 by s 32 of the Southern State Superannuation (Merger of Schemes) Amendment Act 1998 (SA) ("the Merger Act")130. The appellant was a member of the SBS from 11 December 1993 to 30 June 1998 and of the Southern Scheme from 1 July 1998 to 8 February 2002; on repeal of the SBS Act by the Merger Act, his benefits in the first scheme were transferred by 128 (1947) 74 CLR 31 at 75. 129 (2003) 215 CLR 185 at 265 [168]. 130 By virtue of the addition by the Merger Act of Sched 3 to the Southern Scheme Act. Bell operation of law to the second scheme131. In 2002 the appellant carried over his entitlement (consisting of an "employer" component) to another scheme which does not attract the surcharge under the Assessment and Imposition Acts. The Southern Scheme and the SBS both attracted the surcharge provisions and under the former the appellant would have been entitled to a lump sum benefit on attaining 55 years of age. Section 14(1) of the Southern Scheme Act rendered, by its own force, a member of that scheme a person in relation to whom the Crown in right of South Australia was liable to pay a superannuation guarantee charge under the Superannuation Guarantee (Administration) Act 1992 (Cth) ("the Guarantee Act"). That federal statute applied to State employees and s 12(5) classified a member of the Parliament of a State as "an employee of the State". Section 16 obliged employers to pay a "superannuation guarantee charge" in respect of the employer's "shortfall" in making stipulated contributions in respect of employees. The effect was to require employers to pay stipulated contributions to a "complying superannuation fund"132. The same state of affairs respecting the treatment of parliamentarians as employees of the State and so as members of the SBS had been established by s 4(1) of the SBS Act. This also had "picked up" the definition in s 12(5) of the Guarantee Act. Unlike the PSS, the membership of these two schemes was not confined to parliamentarians. Membership was linked to the operation of the Guarantee Act which imposed liability to pay a superannuation guarantee charge upon a widely drawn class of employers and employees. This relevantly included "employees" of the State of South Australia and its agencies and instrumentalities. Further, as already remarked, the appellant's membership of the SBS ($491.70 for 1997 and $424.60 for 1998) and the Southern Scheme ($359.35 for 1999, $368.65 for 2000 and $405 for 2001) were much smaller than those in respect of the PSS. the surcharge amounts in respect of It also should be noted that the appellant, and the State, were drawn into these two schemes only because of the artificial classification by the Guarantee 131 By virtue of the Merger Act. 132 See Austin (2003) 215 CLR 185 at 229-230 [57]-[58]. Bell Act of the appellant as a State employee. That may raise a question of whether in this respect the Guarantee Act itself had the character of a law of general application in the sense discussed earlier in these reasons. The circumstances in which the Guarantee Act was introduced were discussed in Austin133. But neither in that case nor in the present litigation is any point taken respecting the validity of the Guarantee Act and nothing more should be said here on the matter. However, the assets of the fund maintained under the Southern Scheme Act (s 4(2)), like those of the fund maintained under the PSS Act, belonged both in law and in equity to the Crown in right of South Australia. Both the SBS and the Southern Scheme, like the PSS, were classed as constitutionally protected superannuation funds134. Further, the surcharge legislation represented by the Imposition Act and the Assessment Act was attracted to the appellant as a "high-income" member of constitutionally protected funds, regardless of the amounts later payable in respect of any of the three funds. The Parliament of the State responded with respect to the operation of the surcharge upon members of the Southern Scheme by the Statutes Amendment (Miscellaneous Superannuation Measures) Act 2004 (SA) ("the Second Commutation Act"). This commenced on 19 August 2004. Section 14 added s 35AA to the Southern Scheme Act, which provided, upon application, for a member liable for a deferred superannuation contributions surcharge, as a result of a benefit becoming payable under the scheme, to commute fully the pension or to receive part of the benefit in the form of a commutable pension. The Attorney-General, in the Second Reading Speech on the Bill for the Second Commutation Act, said that the proposed law would, among other things, bring members of any of the government's lump sum schemes "into line" with members of the PSS, who "already have the ability to leave part of their retirement benefit in the scheme and use it to extinguish a surcharge liability"135. The Southern Scheme was of the general character described above but the Attorney-General was concerned with the differential treatment of "private sector schemes, [where] the fund itself is liable for the surcharge tax" and the 133 (2003) 215 CLR 185 at 229-230 [57]-[58]. 134 Income Tax Regulations (Amendment) (Cth) SR 1997 No 191. 135 South Australia, House of Assembly, Parliamentary Debates (Hansard), 24 March Bell impact upon members of "government superannuation funds"136 generally. To that broad concern the Melbourne Corporation doctrine is not directed. But to higher office holders such as the appellant the same reasoning applies here as to the PSS. There was the necessary impairment of the governmental functions of South Australia. Matters of evaluation and degree are necessarily involved in reaching that conclusion. Orders The appeal should be allowed and, in place of the answer given by the Full Court to Question 3(a) of the Questions referred by the AAT, it should be answered that the Imposition Act and the Assessment Act are invalid insofar as they purport to create the liability of the appellant to superannuation contributions surcharge in respect of his membership of the PSS, the SBS and the Southern Scheme, the details of which are set out in par 59 of the Statement of Agreed Facts. The first respondent should pay the costs of the appellant. The second respondent, like the State interveners, should bear his own costs. 136 South Australia, House of Assembly, Parliamentary Debates (Hansard), 24 March Hayne HAYNE J. I agree with Gummow, Heydon, Kiefel and Bell JJ that, for the reasons they give, the appeal should be allowed and consequential orders made in the form proposed. ("the SBS") and The appellant's argument gave greater prominence to the Parliamentary Superannuation Scheme ("the PSS") than to the other two schemes: the State the Southern State Superannuation Benefit Scheme Superannuation Scheme ("the Southern Scheme"). There were at least two reasons for the focus of argument falling upon the PSS. First, the amounts at stake in relation to the appellant's membership of the PSS were much larger than the amounts referable to the other two schemes. Secondly, membership of the PSS was evidently related to the appellant's membership of a State legislature whereas membership of the other two schemes was not. The SBS and the Southern Scheme each embraced a wide range of State government employees. It is important, however, to recognise that the fact that membership of the SBS and the Southern Scheme was not confined to parliamentarians or others "at the higher levels of government"137 is not relevant to the question that arises in this matter. The principle that is engaged directs attention to whether the laws in issue interfere with, or impair, the governmental capacities of the States138 (in this case, a State's capacity to decide the terms and conditions under which members of the State Parliament serve). As pointed out in Austin v The Commonwealth139, that inquiry "turns upon matters of evaluation and degree" and "requires assessment of the impact of particular laws by such criteria as 'special burden' and 'curtailment' of 'capacity' of the States 'to function as governments'". The matter of evaluation and degree in this case concerns the effect of imposing a surcharge on superannuation entitlements of State parliamentarians which, as explained in the reasons of Gummow, Heydon, Kiefel and Bell JJ, created an obligation to pay a deferred compounding tax when the superannuation benefits in question become payable. In explaining why a State's capacity to choose the way in which State parliamentarians are remunerated is constitutionally significant, it is necessary to 137 Austin v The Commonwealth (2003) 215 CLR 185 at 260-261 [152]; [2003] HCA 3; Re Australian Education Union; Ex parte Victoria (1995) 184 CLR 188 at 233; [1995] HCA 71. 138 Austin (2003) 215 CLR 185 at 217 [24] per Gleeson CJ, 246-249 [116]-[124] per Gaudron, Gummow and Hayne JJ. 139 (2003) 215 CLR 185 at 249 [124]. Hayne begin by recalling that, as pointed out in Austin140, the principle which is engaged in this matter is necessarily expressed in negative terms and at a high level of abstraction. But as the plurality reasons in Austin also show, examination of the application of the relevant principle must begin from an understanding of what was said about that principle in Melbourne Corporation v The Commonwealth141. The root of the relevant principle is found in the proposition, often quoted from the reasons of Dixon J in Melbourne Corporation142, that "[t]he foundation of the Constitution is the conception of a central government and a number of State governments separately organised. The Constitution predicates their continued existence as independent entities." This proposition, and particularly the reference to the continued existence of independent polities, must be understood in the context of the reasons as a whole. The law in question in Melbourne Corporation in effect required States and their authorities (including local government authorities) to conduct their banking business only with the Commonwealth Bank or a State bank. A central thrust of the argument advanced by counsel for the plaintiff (Mr Garfield Barwick) against the validity of that law was that it was not properly to be characterised as a law with respect to banking "because it discriminates against (in the sense that it is 'aimed at') the States and State authorities"143. This argument, in so far as it was founded on ascribing a single characterisation to the law in question, was rejected144 by Dixon J: "Speaking generally, once it appears that a federal law has an actual and immediate operation within a field assigned to the Commonwealth as a subject of legislative power, that is enough. It will be held to fall within the power unless some further reason appears for excluding it. That it discloses another purpose and that the purpose lies outside the area of federal power are considerations which will not in such a case suffice to invalidate the law." But the law was held invalid. The hinge about which the reasons of Dixon J turned is found in the contrast drawn145 between recognition that a law may be 140 (2003) 215 CLR 185 at 246 [115]. 141 (1947) 74 CLR 31; [1947] HCA 26. 142 (1947) 74 CLR 31 at 82. 143 (1947) 74 CLR 31 at 35. 144 (1947) 74 CLR 31 at 79. 145 (1947) 74 CLR 31 at 78-80. Hayne characterised in more than one way, and the implication, drawn from the structure of the Constitution, that "a law which discriminates against States, or a law which places a particular disability or burden upon an operation or activity of a State, and more especially upon the execution of its constitutional powers", is beyond power. The contrast was expressed146 by Dixon J in the following terms: "But it is one thing to say that a federal law may be valid notwithstanding a purpose of achieving some result which lies directly within the undefined area of power reserved to the States. It is altogether another thing to apply the same doctrine to a use of federal power for a purpose of restricting or burdening the State in the exercise of its constitutional powers. The one involves no more than a distinction between the subject of a power and the policy which causes its exercise. The other brings into question the independence from federal control of the State in the discharge of its functions." As Dixon J went on to say147: "What is important is the firm adherence to the principle that the federal power of taxation will not support a law which places a special burden upon the States. They cannot be singled out and taxed as States in respect of some exercise of their functions. Such a tax is aimed at the States and is an attempt to use federal power to burden or, may be, to control State action." And with that in mind it is necessary, as was also said148 in Melbourne Corporation, to distinguish "between a law of general application and a provision singling out governments and placing special burdens upon the exercise of powers or the fulfilment of functions constitutionally belonging to them". The laws in question in this matter and in Austin were directed only to those who were to receive benefits from "constitutionally protected" funds. They were not laws of general application. They did not impose taxes upon the States but they did single out those "at the higher levels of government"149: in this case State parliamentarians; in Austin, State judges. The laws in issue in this matter imposed on those persons a special and legally different taxation regime from that which generally applied to those who were to receive pensions or 146 (1947) 74 CLR 31 at 80. 147 (1947) 74 CLR 31 at 81. 148 (1947) 74 CLR 31 at 81-82. 149 Austin (2003) 215 CLR 185 at 260-261 [152]. Hayne superannuation benefits. Under the generally applicable regime, a surcharge was imposed on the amount of tax deductible contributions made to superannuation funds by those identified as "high income earners". That surcharge was payable by superannuation providers, not members of the fund. The laws now in issue required those who were to receive retirement benefits to which the laws applied to pay the surcharge on what the Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997 (Cth) ("the Assessment and Collection Act") identified150 as the "surchargeable contributions" of the recipient. If, as with the SBS and the Southern Scheme, there were amounts contributed by an "employer" for the appellant, to a constitutionally protected superannuation fund that was a complying superannuation fund within the meaning of s 45 of the Superannuation Industry (Supervision) Act 1993 (Cth), those contributions were part of the surchargeable contributions of the appellant151. And if, as with the PSS, the appellant was a member of a defined benefits superannuation scheme, the surchargeable contributions were152 "the amounts that constitute the actuarial value of the benefits that accrued to, and the value of the administration expenses and risk benefits provided in respect of, the member" for the relevant financial year. Satisfaction of the obligation to pay the surcharge could be deferred until receipt of the benefits153 but interest accrued and compounded in respect of each annual assessment154. As pointed out in Austin155, the choice whether to pay the surcharge as it accrued necessarily chanced fortune. And, as also discussed in Austin156, the use of actuarial calculations to determine the value of benefits accruing to a member of a defined benefits superannuation scheme did not always accurately reflect the position of any particular member. 151 See Superannuation Contributions Tax (Members of Constitutionally Protected Superannuation Funds) Assessment and Collection Act 1997 (Cth) ("the Assessment and Collection Act"), s 9(2) and s 274 of the Income Tax Assessment Act 1936 (Cth). 152 Assessment and Collection Act, s 9(4). 153 Assessment and Collection Act, s 15(6). 154 Assessment and Collection Act, s 15(4). 155 (2003) 215 CLR 185 at 239-240 [89]-[91], 265 [169]. 156 (2003) 215 CLR 185 at 238-239 [88]. Hayne As remarked in Austin157, there is an apparent incongruity in singling out for the same impost those who are entitled to concessional deductions for contributions to superannuation funds and those in the public sector whose superannuation arrangements are non-contributory. But whether, or to what extent, the features of the legislation just mentioned lead to a result that members of constitutionally protected superannuation funds are taxed in a way that provides some measure of economic equivalence with the position of "high income earners"158 made subject to a surcharge payable by their superannuation funds is not to the point. What is important is that the laws now in issue, by their effect on how States may choose to remunerate their parliamentarians, place a special disability or burden upon the exercise of powers and the fulfilment of functions of the States. It is for a State to decide how and in what amount its parliamentarians are to be remunerated. Is it to be by salary, with or without funded or unfunded retirement benefits, or other forms of benefit? Are some or all of those benefits to be provided with or without contribution by the beneficiary? Are any or all of the benefits to be defined or are they to be an accumulation of whatever is contributed with interest? Are benefits to be paid by pension or in lump sum? The legislation imposing the surcharge in issue in this matter impairs the capacity of a State to choose between these various forms of remuneration of its parliamentarians in one particular but important respect: the State has no real choice but to adopt a method of providing retirement benefits that will enable parliamentarians to meet the tax liability specially imposed on them. That a State may have made particular choices about these matters in the past, and the effect of the surcharge on the arrangements chosen, is not to the point. Whether a State has chosen to administer the superannuation entitlements of State parliamentarians through one or more separately established schemes, or in conjunction with other superannuation arrangements for other State "employees", does not alter the effect of the surcharge upon the capacity of the State to fix the terms and conditions under which State parliamentarians serve. The effect of the surcharge on that capacity remains the same, no matter whether, before the enactment of the legislation imposing the surcharge, the State had chosen to provide retirement benefits for parliamentarians through a separate unfunded parliamentary pension scheme providing defined benefits, or had chosen to do so through one or more general public sector schemes providing undefined benefits. 157 (2003) 215 CLR 185 at 231 [62]. 158 (2003) 215 CLR 185 at 231 [62]. Hayne And if, as here, a part of the overall retirement benefits provided for parliamentarians is attributable to contributions which the State makes to a superannuation fund in satisfaction of an obligation imposed on all employers to make not less than a minimum superannuation contribution, there remains the question about the effect of the surcharge on the capacity of the State to fix the terms and conditions upon which the State parliamentarians serve. Even if the law imposing an obligation on employers to make contributions is a law of general application (an issue not examined in this matter) the tax imposed on members of constitutionally protected funds is not. The tax imposes a special burden on the exercise of powers or the fulfilment of functions of the State. Neither the destination of any superannuation contributions made by the State of South Australia in respect of the appellant's service as a parliamentarian, nor the reason or occasion for making those contributions, affects the assessment of the impact of the relevant provisions upon the capacity of the State to function as a government. That some of the benefits provided for State parliamentarians are defined benefits and others are not is likewise irrelevant. The necessary impairment of the governmental functions of the State was demonstrated in respect of the whole of the amounts at issue in this case. The appeal should be allowed. Hayne
HIGH COURT OF AUSTRALIA SORWAR HOSSAIN APPELLANT AND MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR RESPONDENTS Hossain v Minister for Immigration and Border Protection [2018] HCA 34 15 August 2018 ORDER The appeal is dismissed with costs. On appeal from the Federal Court of Australia Representation G O'L Reynolds SC with B M Zipser and D P Hume for the appellant (instructed by Mooney & Kennedy Solicitors) C J Horan QC with T Reilly for the first respondent (instructed by Sparke Helmore Lawyers) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Hossain v Minister for Immigration and Border Protection Migration – Partner visa – Criteria prescribed for grant of visa – Where Minister for Immigration and Border Protection must refuse to grant visa if not satisfied that criteria prescribed for grant of visa met – Where delegate of Minister refused to grant visa – Review of decision by Administrative Appeals Tribunal – Where Tribunal not satisfied that visa application made within 28 days or that there were compelling reasons for not applying that criterion – Where Tribunal also not satisfied that visa applicant did not have outstanding debts to the Commonwealth or that appropriate arrangements had been made for payment of debts – Where Tribunal made error of law by assessing whether compelling reasons existed as at time of visa application instead of as at time of Tribunal's decision – Whether error of law in relation to one criterion was jurisdictional error where another criterion was not met. Words and phrases – "compelling reasons", "discretion to refuse relief", "error of law", "error of law on the face of the record", "fundamental error", "independent basis", "jurisdictional error", "materiality", "non-jurisdictional error", "reasonably and on a correct understanding and application of the applicable law", "residual discretion", "satisfied", "void", "voidable". Migration Act 1958 (Cth), s 65. Migration Regulations 1994 (Cth), Sched 2, cll 820.211, 820.223, Sched 4, public interest criterion 4004. KIEFEL CJ, GAGELER AND KEANE JJ. The Federal Circuit Court1, exercising "the same original jurisdiction in relation to migration decisions as the High Court has under paragraph 75(v) of the Constitution" conferred on it under s 77(i) of the Constitution by s 476(1) of the Migration Act 1958 (Cth), made an order in the nature of certiorari, setting aside a decision of the Administrative Appeals Tribunal which had affirmed a decision of a delegate of the Minister for Immigration and Border Protection to refuse to grant a visa, and an order in the nature of mandamus, remitting the subject matter of that decision to the Tribunal for redetermination. The Federal Circuit Court made those orders consequent on finding a jurisdictional error constituted by an error of law in the reasoning of the Tribunal which led to the decision. The Federal Circuit Court was correct to find an error of law in the reasoning of the Tribunal which led to the decision; indeed, the error of law was conceded. The Federal Circuit Court was incorrect to characterise that error as a jurisdictional error. That is because, on the facts found by the Tribunal, the Tribunal had a duty to affirm the decision of the delegate in any event. The Tribunal had not exceeded its jurisdiction by making the decision which it made. The Full Court of the Federal Court2, by majority, allowed an appeal and set aside the orders of the Federal Circuit Court. The majority was correct to do so, although not exactly for the reasons which it gave. This appeal from the judgment of the Full Court must accordingly be dismissed. The Tribunal Mr Hossain, a citizen of Bangladesh, made a valid application for a partner visa. The application was considered by a delegate of the Minister. Not being satisfied that criteria prescribed by the Migration Regulations 1994 (Cth) for the grant of the visa had been met, the delegate refused to grant the visa. Mr Hossain then applied to the Tribunal for merits review of the delegate's decision. The Tribunal affirmed the decision of the delegate because it was not itself satisfied that two prescribed criteria had been met. One was a criterion which related to the timing of the making of the application. Relevantly to the circumstances of Mr Hossain, it required that the application be validly made within 28 days of the applicant ceasing to hold a previous visa "unless the Minister is satisfied that there are compelling reasons for not applying [that 1 Hossain v Minister for Immigration and Border Protection [2016] FCCA 1729. 2 Minister for Immigration and Border Protection v Hossain (2017) 252 FCR 31. criterion]"3. The other was a public interest criterion expressed in terms that the visa applicant "does not have outstanding debts to the Commonwealth unless the Minister is satisfied that appropriate arrangements have been made for payment"4. The Tribunal was not satisfied on the evidence before it that either criterion was met. On that basis, the Tribunal affirmed the decision of the delegate. In relation to the criterion relating to the timing of the making of the application, the Tribunal found that Mr Hossain had not applied within 28 days of ceasing to hold a previous visa and was satisfied that there were no compelling reasons as at the time of the application for not applying the criterion. In relation to the public interest criterion, the Tribunal noted in its reasons for decision that Mr Hossain had admitted in evidence before the Tribunal that he had an outstanding debt to the Commonwealth which he had made no arrangements to pay, but which he said he intended to pay. The Tribunal also noted that at the time of its decision, more than a week after he had appeared before it, Mr Hossain had provided no evidence that he had taken steps to pay the debt in the interim. The Tribunal recorded that it was not convinced that his stated intention to pay the debt was genuine and that it was not satisfied that appropriate arrangements had been made for payment. The Federal Circuit Court Mr Hossain applied to the Federal Circuit Court for judicial review of the Tribunal's decision. By the time that application came to be heard by the Federal Circuit Court, Mr Hossain had fully paid his debt to the Commonwealth. The Minister conceded before the Federal Circuit Court that the Tribunal had erred in law in attempting to apply the criterion which related to the timing of the making of the application. The conceded error lay in the Tribunal having addressed the question of whether there were compelling reasons for not applying the criterion as at the time of the application for the visa rather than as 3 Clause 820.211(2)(d)(ii) of Sched 2 to the Migration Regulations, read with criterion 3001 in Sched 3 to the Migration Regulations. 4 Clause 820.223(1)(a) of Sched 2 to the Migration Regulations, read with public interest criterion 4004 in Sched 4 to the Migration Regulations. at the time of its own decision5. The Minister argued that the conceded error was not a jurisdictional error, because the Tribunal's failure to be satisfied that the public interest criterion was met at the time of its decision provided an independent basis on which the Tribunal was bound to affirm the delegate's decision. The Federal Circuit Court rejected the Minister's argument, refusing to engage in what it described as an "unbundling" of the Tribunal's reasons for decision into "impeachable" and "unimpeachable" parts6. Holding that the Tribunal's error was a jurisdictional error, the Federal Circuit Court found no discretionary reason to withhold the relief which Mr Hossain sought under s 476 of the Migration Act7. The Full Court of the Federal Court On appeal to the Federal Court, the Minister repeated substantially the same argument which he had put to the Federal Circuit Court. The majority in the Full Court of the Federal Court comprised Flick and Farrell JJ. They rejected the Minister's argument in form. They chose to characterise the Tribunal's error as "jurisdictional". They nevertheless accepted the Minister's argument in substance, holding that the Tribunal's error had not stripped the Tribunal of authority to make the decision to affirm the delegate's The dissentient, Mortimer J, also thought that the Tribunal's error, being an error in the construction and application of a visa criterion, warranted the label of "jurisdictional". Noting that "it is difficult to discern a consistent approach throughout the authorities as to the appropriate outcome where there is more than one basis for a Tribunal's decision on review under the Migration Act", Mortimer J thought that the correct approach was "to accept an error of this kind is jurisdictional and then to ask whether there is utility in the grant of relief to an 5 Applying Waensila v Minister for Immigration and Border Protection (2016) 241 FCR 121. [2016] FCCA 1729 at [20], using language drawn from SZBYR v Minister for Immigration and Citizenship (2007) 81 ALJR 1190 at 1198 [29]; 235 ALR 609 at 618-619; [2007] HCA 26. [2016] FCCA 1729 at [25]-[29]. (2017) 252 FCR 31 at 39-40 [27]-[30]. applicant, because of a second basis for the decision on review"9. Approaching the matter as one of discretion, she concluded that the orders made by the Federal Circuit Court were not futile because the fact that the debt to the Commonwealth had been repaid meant that, on reconsideration by the Tribunal, Mr Hossain's meeting of the public interest criterion would no longer be in issue10. Mortimer J indicated that, if she were wrong about the correct approach, she would have inclined to the alternative view that the two visa criteria in issue before the Tribunal were not entirely independent of each other. The connection between them which she postulated was that if the Tribunal had been satisfied that there were compelling reasons for not applying the criterion relating to the timing of the making of the application, the Tribunal, properly instructed, might have been persuaded to delay making its decision until such time as Mr Hossain was able to satisfy it that he had either paid his debt to the Commonwealth (as he had told the Tribunal he intended to do and as in fact he later did) or entered into an arrangement with the Commonwealth for payment to occur11. This appeal On appeal by special leave to this Court, Mr Hossain relies on arguments which develop the themes reflected in the reasoning of Mortimer J. The Minister repeats the substance of the argument which he put to the Federal Circuit Court and to the Full Court of the Federal Court. Jurisdiction and jurisdictional error The term "jurisdiction", Frankfurter J once wrote, "is a verbal coat of too many colors"12. The terminological tangle in which the Full Court entwined itself in the decision under appeal shows how readily the terminology of jurisdiction, and the associated terminology of jurisdictional error, can be misunderstood. Yet, as Frankfurter J elsewhere recognised, in an administrative (2017) 252 FCR 31 at 49 [69]-[70]. 10 (2017) 252 FCR 31 at 56-57 [100]. 11 (2017) 252 FCR 31 at 51 [75]-[76]. 12 United States v L A Tucker Truck Lines Inc 344 US 33 at 39 (1952). law context there can be circumstances in which "new formulas attempting to rephrase the old are not likely to be more helpful than the old"13. Professor Jaffe responded to Frankfurter J. He characterised criticism of the language of jurisdiction as "barrenly semantic" in failing to face the question of why a court denominates some questions as jurisdictional and others as not14. The answer he proffered was that the language of jurisdiction is a traditional expression of the function of a court, acting within the limits of its own jurisdiction where no statutory mode of review existed, of ensuring that a repository of statutory power did not strain the statutory limits of that power. "In short," he suggested, "the concept is almost entirely functional: it is used to validate review when review is felt to be necessary."15 Professor Jaffe continued by way of explanation16: "There will be situations in which the apparent or stated intention of the legislature is to limit review to certain gross errors, and in which the notion of jurisdiction, familiar as it is to judges and lawyers, will be as good as any to express the scope of review. There are other situations, too – organizational or procedural mistakes – in which the lapse is so serious that judges will want a concept which enables them to declare the order 'void.'" He concluded: "If it is understood that the word 'jurisdiction' is not a metaphysical absolute but simply expresses the gravity of the error, it would seem that this is a concept for which we must have a word and for which use of the hallowed word is justified." 13 Universal Camera Corp v National Labor Relations Board 340 US 474 at 489 14 Jaffe, "Judicial Review: Constitutional and Jurisdictional Fact", (1957) 70 Harvard Law Review 953 at 962-963. 15 Jaffe, "Judicial Review: Constitutional and Jurisdictional Fact", (1957) 70 Harvard Law Review 953 at 963. 16 Jaffe, "Judicial Review: Constitutional and Jurisdictional Fact", (1957) 70 Harvard Law Review 953 at 963. Six members of this Court picked up that language of Professor Jaffe, and more importantly gave effect to that underlying conception of jurisdiction and of jurisdictional error, when they chose in Kirk v Industrial Court (NSW)17 to express the constitutionally entrenched minimum content of the supervisory jurisdiction of a State Supreme Court to enforce "the limits on the exercise of State executive and judicial power by persons and bodies other than the Supreme Court" in terms of the "distinction between jurisdictional and non-jurisdictional error". Faced with the privative clause in s 474 of the Migration Act, six members of the Court had previously given effect to the same conception in invoking the same distinction in Plaintiff S157/2002 v The Commonwealth18 to explain the constitutionally entrenched minimum content of the jurisdiction conferred on the Court by s 75(v) to enforce the limits on the exercise of Commonwealth executive or judicial power by officers of the Commonwealth. Had statutory mechanisms for judicial review (such as that contained in the Administrative Procedure Act 1946 (US) or the Administrative Decisions (Judicial Review) Act 1977 (Cth)) been enacted to cover judicial review of statutory decision-making more comprehensively, the terminology of jurisdiction and of jurisdictional error in its application to administrative action may well have fallen into desuetude in Australia. Indeed, there was a time in the 1980s and 1990s when the terminology was little used, and doubts were expressed even afterwards as to its continuing utility19. For so long as there remains a necessity for courts to fall back on constitutionally entrenched minimum jurisdictions to engage in judicial review of administrative action, however, the traditional distinction between jurisdictional and non-jurisdictional error cannot be avoided20. The traditional distinction can be explained in more modern language. But an attempt to reframe the distinction in entirely new language is unlikely to be helpful. 17 (2010) 239 CLR 531 at 580 [98], 581 [100]; [2010] HCA 1. 18 (2003) 211 CLR 476 at 482-483 [5], 513-514 [103]-[104]; [2003] HCA 2. 19 Eg Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 77 ALJR 1165 at 1185-1186 [119]-[123], 1191 [154]; 198 ALR 59 at 85-86, 94; [2003] HCA 30; Federal Commissioner of Taxation v Futuris Corporation Ltd (2008) 237 CLR 146 at 184 [129]; [2008] HCA 32. 20 Cf Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 24-25 [76]-[77]; [2003] HCA 6. Jurisdiction, in the most generic sense in which it has come to be used in this field of discourse, refers to the scope of the authority that is conferred on a repository. In its application to judicial review of administrative action the taking of which is authorised by statute, it refers to the scope of the authority which a statute confers on a decision-maker to make a decision of a kind to which the statute then attaches legal consequences. It encompasses in that application all of the preconditions which the statute requires to exist in order for the decision-maker to embark on the decision-making process. It also encompasses all of the conditions which the statute expressly or impliedly requires to be observed in or in relation to the decision-making process in order for the decision-maker to make a decision of that kind. A decision made within jurisdiction is a decision which sufficiently complies with those statutory preconditions and conditions to have "such force and effect as is given to it by the law pursuant to which it was made"21. Jurisdictional error, in the most generic sense in which it has come to be used to describe an error in a statutory decision-making process, correspondingly refers to a failure to comply with one or more statutory preconditions or conditions to an extent which results in a decision which has been made in fact lacking characteristics necessary for it to be given force and effect by the statute pursuant to which the decision-maker purported to make it. To describe a decision as "involving jurisdictional error" is to describe that decision as having been made outside jurisdiction22. A decision made outside jurisdiction is not necessarily to be regarded as a "nullity", in that it remains a decision in fact which may yet have some status in law23. But a decision made outside jurisdiction is a decision in fact which is properly to be regarded for the purposes 21 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at 613 [46]; [2002] HCA 11. 22 Eg Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 23 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at 613 [46]; Jadwan Pty Ltd v Secretary, Department of Health and Aged Care (2003) 145 FCR 1 at 16 [42]. of the law pursuant to which it was purported to be made as "no decision at all"24. To that extent, in traditional parlance, the decision is "invalid" or "void"25. To return to the explanation of Professor Jaffe, jurisdictional error is an expression not simply of the existence of an error but of the gravity of that error. In the language of Selway J, the unavoidable distinction between jurisdictional errors and non-jurisdictional errors is ultimately "a distinction between errors that are authorised and errors that are not; between acts that are unauthorised by law and acts that are authorised"26. Although ultimately correct in the result, the majority in the Full Court was therefore wrong to distinguish between a decision involving jurisdictional error and a decision wanting in authority. They are one and the same. Just as identification of the preconditions to and conditions of an exercise of decision-making power conferred by statute turns on the construction of the statute, so too does discernment of the extent of non-compliance which will result in an otherwise compliant decision lacking the characteristics necessary to be given force and effect by the statute turn on the construction of the statute27. The question of whether a particular failure to comply with an express or implied statutory condition in purporting to make a particular decision is of a magnitude which has resulted in taking the decision outside the jurisdiction conferred by the statute cannot be answered except by reference to the construction of the statute. The common law principles which inform the construction of statutes conferring decision-making authority28 reflect longstanding qualitative judgments 24 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 25 Baxter v New South Wales Clickers' Association (1909) 10 CLR 114 at 157; [1909] HCA 90; Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 92 ALJR 248 at 264 [63]; 351 ALR 225 at 241; [2018] HCA 4. 26 Selway, "The Principle Behind Common Law Judicial Review of Administrative Action – The Search Continues", (2002) 30 Federal Law Review 217 at 234, quoted in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 25 [77]. 27 Cf Minister for Immigration and Citizenship v SZIZO (2009) 238 CLR 627 at 640 [35]; [2009] HCA 37. 28 Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 666 [97]; [2012] HCA 31. about the appropriate limits of an exercise of administrative power to which a legislature can be taken to adhere in defining the bounds of such authority as it chooses to confer on a repository in the absence of affirmative indication of a legislative intention to the contrary29. Those common law principles are not derived by logic alone and cannot be treated as abstractions disconnected from the subject matter to which they are to be applied. They are not so delicate or refined in their operation that sight is lost of the fact that "[d]ecison-making is a function of the real world"30. That a decision-maker "must proceed by reference to correct legal principles, correctly applied"31 is an ordinarily (although not universally32) implied condition of a statutory conferral of decision-making authority. Ordinarily, a statute which impliedly requires that condition or another condition to be observed in the course of a decision-making process is not to be interpreted as denying legal force and effect to every decision that might be made in breach of the condition. The statute is ordinarily to be interpreted as incorporating a threshold of materiality in the event of non-compliance. Whilst a statute on its proper construction might set a higher or lower threshold of materiality33, the threshold of materiality would not ordinarily be met in the event of a failure to comply with a condition if complying with the condition could have made no difference to the decision that was made in the circumstances in which that decision was made. The threshold would not ordinarily be met, for example, where a failure to afford procedural fairness did not deprive the person who was denied an opportunity to be heard of "the possibility of a successful outcome"34, or where a decision-maker failed to take 29 Robertson, "Is Judicial Review Qualitative?", in Bell et al (eds), Public Law Adjudication in Common Law Systems: Process and Substance, (2016) 243. 30 Enichem Anic Srl v Anti-Dumping Authority (1992) 39 FCR 458 at 469. 31 Plaintiff M61/2010E v The Commonwealth (Offshore Processing Case) (2010) 243 CLR 319 at 354 [78]; [2010] HCA 41. 32 Eg Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 92 ALJR 248; 351 ALR 225. 33 Cf SAAP v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 228 CLR 294; [2005] HCA 24. 34 Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326 at 341 [56]; [2015] HCA 40, quoting Stead v State Government Insurance (Footnote continues on next page) into account a mandatory consideration which in all the circumstances was "so insignificant that the failure to take it into account could not have materially affected" the decision that was made35. Thus, as it was put in Wei v Minister for Immigration and Border Protection36, "[j]urisdictional error, in the sense relevant to the availability of relief under s 75(v) of the Constitution in the light of s 474 of the Migration Act, consists of a material breach of an express or implied condition of the valid exercise of a decision-making power conferred by that Act". Ordinarily, as here, breach of a condition cannot be material unless compliance with the condition could have resulted in the making of a different decision. Absence of jurisdictional error The Tribunal, in reviewing the delegate's decision under s 348 of the Migration Act, was obliged by s 349(1) to form its own conclusion on the material before it as to the proper performance of the duty imposed on the Minister by s 65. The Tribunal's own conclusion as to the proper performance of the duty imposed on the Minister by s 65 was then to be reflected in a decision under s 349(2), relevantly, either to affirm the decision of the delegate or to set aside the decision of the delegate and to substitute its own decision, which would then be taken by force of s 349(3) to be a decision of the Minister. The operation of s 65 of the Migration Act was explained in Plaintiff S297/2013 v Minister for Immigration and Border Protection37: "The decision to be made by the Minister in performance of the duty imposed by s 65 is binary: the Minister is to do one or other of two mutually exclusive legally operative acts – to grant the visa under s 65(1)(a), or to refuse to grant the visa under s 65(1)(b) – depending on the existence of one or other of two mutually exclusive states of affairs (or Commission (1986) 161 CLR 141 at 147; [1986] HCA 54. Eg Minister for Immigration and Border Protection v WZAPN (2015) 254 CLR 610 at 637-638 [78]; [2015] HCA 22. 35 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 40; [1986] HCA 40. Cf Martincevic v Commonwealth (2007) 164 FCR 45 at 64-65 36 (2015) 257 CLR 22 at 32 [23]; [2015] HCA 51. 37 (2014) 255 CLR 179 at 188-189 [34]; [2014] HCA 24 (footnote omitted). 'jurisdictional facts') – the Minister's satisfaction of the matters set out in each of the sub-paragraphs of s 65(1)(a), or the Minister's non-satisfaction of one or more of those matters." The matters set out in the sub-paragraphs of s 65(1)(a) centrally include that the criteria prescribed by the Migration Act and the Migration Regulations for the visa for which a valid application has been made have been met. Formation of the Minister's state of satisfaction or of non-satisfaction is in each case conditioned by a requirement that the Minister or his or her delegate, or the Tribunal forming its own conclusion on review, must proceed reasonably and on a correct understanding and application of the applicable law38, which includes the criteria prescribed by the Migration Act and the Migration Regulations for the visa in question. Here the Tribunal breached that implied condition by misconstruing and misapplying the criterion which related to the timing of the making of the application. The breach, however, could have made no difference to the decision which the Tribunal in fact made to affirm the decision of the delegate. That was because the Tribunal was not satisfied that the public interest criterion was met, and, on the findings which the Tribunal made, the Tribunal could not reasonably have been satisfied that the public interest criterion was met. The Tribunal in those circumstances had no option but to affirm the decision of the delegate. The suggestion of Mortimer J in dissent, that the Tribunal might have delayed making its decision to allow Mr Hossain time to meet the public interest criterion had it not erred in construing and applying the criterion relating to the timing of the making of the application, rises no higher than conjecture. The Tribunal was not asked to delay making its decision and, in any event, did not believe Mr Hossain when he said that he intended to pay his outstanding debt to the Commonwealth. The Tribunal's error in construing and applying the criterion relating to the timing of the making of the application did not rise to the level of a jurisdictional error. 38 Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 651-654 [130]-[137]; [1999] HCA 21; Enfield City Corporation v Development Assessment Commission (2000) 199 CLR 135 at 150 [34]; [2000] HCA 5; Graham v Minister for Immigration and Border Protection (2017) 91 ALJR 890 at 904 [57]; 347 ALR 350 at 363-364; [2017] HCA 33; Wilkie v The Commonwealth (2017) 91 ALJR 1035 at 1055 [109]; 349 ALR 1 at 26; [2017] HCA 40. Orders The appeal is to be dismissed with costs. Nettle NETTLE J. I agree with Edelman J that the appeal should be dismissed, substantially for the reasons his Honour gives. With respect, however, I wish to observe that there may be a number of circumstances in which an error is jurisdictional despite not depriving a party of the possibility of a successful outcome. Edelman J has referred39 to one such circumstance: where respect for the dignity of the individual may mean that a denial of procedural fairness should be regarded as a jurisdictional error regardless of the effect it may have had on the result reached by the decision maker40. Another such circumstance is where a decision maker is required to make a decision by reference to a single specified criterion and, in error, addresses himself or herself to the wrong criterion. In such a case, the decision maker's error will be a jurisdictional error – a failure to exercise the jurisdiction of deciding the question according to the applicable criterion – regardless of whether one can say that, if properly directed and having determined the application by reference to the correct criterion, the decision maker would have been bound to make the same decision41. It is different in this case because, although the Administrative Appeals Tribunal misdirected itself as to the test to be applied in relation to cl 820.211(2)(d)(ii) of Sched 2 to the Migration Regulations 1994 (Cth), and thereby made an error of law, the Tribunal retained jurisdiction and was bound to determine the application, as it did, on the separate and wholly independent basis that the appellant did not meet public interest criterion 4004 for the purpose of cl 820.223(1)(a) of Sched 2 to the Migration Regulations (due to the appellant's outstanding debt to the Commonwealth at the time of the Tribunal's decision). More specifically, since the Tribunal's error in relation to cl 820.211(2)(d)(ii) was separate from and independent of the decision which the Tribunal was required to make in relation to cl 820.223(1)(a), and could not possibly have affected the Tribunal's decision in relation to cl 820.223(1)(a), the error in relation to cl 820.211(2)(d)(ii) was not a jurisdictional error. Given the broad range of decisions in which errors are apt to be made, and the large variety of circumstances and statutory schemes which may attend them, it is impossible to divine an a priori classification of the jurisdictional errors that do not deprive a party of the possibility of a successful outcome. Perhaps the most that can or should be said on the subject is that, if an error is jurisdictional, 40 See R (Osborn) v Parole Board [2014] AC 1115 at 1149 [68] per Lord Reed JSC. 41 See for example Kabir v Minister for Immigration and Citizenship (2010) 118 ALD 513. Nettle in the scheme of things it will not infrequently be the case that it will deprive a party of a possibility of a successful outcome. I wish also to observe that the exercise of residual discretion to refuse relief in a case of jurisdictional error may, in an appropriate case, depend on a backward-looking test of whether there could possibly have been a different outcome42. Much depends on the circumstances of the case. But as the Tribunal's error in this case was not a jurisdictional error, it is unnecessary and undesirable to say anything further on the residual discretion. 42 See and compare Giretti v Commissioner of Taxation (1996) 70 FCR 151 at 165 per Lindgren J (Jenkinson J agreeing at 152); Kabir v Minister for Immigration and Citizenship (2010) 118 ALD 513 at 520-521 [44]-[53]. Edelman Introduction The Administrative Appeals Tribunal ("the Tribunal") affirmed the decision of a delegate of the Minister to refuse to grant a visa to the appellant. The Tribunal did so for two independent reasons. The first reason for decision involved an error of law. The second reason did not. The Federal Circuit Court of Australia quashed the decision of the Tribunal on the basis that the error of law was a jurisdictional error. A majority of the Full Court of the Federal Court of Australia allowed the appeal on the basis that, although the error in relation to the first reason for decision involved a jurisdictional error, the Tribunal retained jurisdiction because the second reason disclosed no error. The essence of the appellant's ground of appeal in this Court, and his submissions on the appeal, was that it was an inherent contradiction for the Full Court to conclude that the Tribunal (i) made a jurisdictional error, meaning that it lacked authority to make its decision, and (ii) retained authority to make its decision. That submission should be accepted. However, the simplicity with which this submission was expressed conceals deep fissures and uncertainties underlying the notion and nature of jurisdictional error. In 1929, Gordon observed in relation to jurisdiction that "in no branch of English law is there more confusion and conflict"43. This case illustrates that, nearly a century later, there is still significant difficulty. The Minister filed a notice of contention alleging that the decision of the Full Court should be upheld on the basis that the error of law by the Tribunal was not "jurisdictional" because the Tribunal's decision was not affected by the error. In the alternative, the Minister said that the Full Court should have withheld the exercise of its discretion to grant relief because the error did not affect the Tribunal's decision. The notice of contention should be upheld on the first ground: the error of law was not material because it was neither a fundamental error nor an error that could have affected the Tribunal's decision. The lack of materiality meant that the error was not a jurisdictional error. The appeal must be dismissed. Background and legislative provisions The appellant is a citizen of Bangladesh. He came to Australia in May 2003, holding a student visa. That visa expired on 7 November 2005. In the meantime, the appellant had applied for a protection visa, which was refused. After exhausting all available applications and appeals, the appellant was 43 Gordon, "The Relation of Facts to Jurisdiction", (1929) 45 Law Quarterly Review Edelman unsuccessful. He attempted to make another application for a protection visa in 2008, but it was deemed invalid. Between September 2008 and January 2013, the appellant was in Australia as an unlawful non-citizen. In January 2013, the appellant made another application for a protection visa. This application was refused by a delegate of the Minister, which refusal was affirmed by the Refugee Review Tribunal. Subsequent requests for ministerial consideration were refused. In 2010, the appellant met the woman who, in 2013, became his de facto partner. In May 2015, he applied for a Partner (Temporary) (Class UK) visa. A delegate of the Minister refused that application. The appellant sought review of the decision by the Tribunal. In order to be granted a visa, the appellant had to satisfy the decision maker that he satisfied requirements including the "criteria ... prescribed by ... the regulations"44. The two relevant criteria were prescribed by cll 820.211 and 820.223 of Sched 2 to the Migration Regulations 1994 (Cth). First, cl 820.211(1)(b) relevantly provided that an applicant was required to meet the requirements of various sub-clauses. Clause 820.211(2)(d)(ii) required an applicant who is not the holder of a substantive visa and did not enter Australia holding a diplomatic visa or special purpose visa to satisfy criteria 3001, 3003 and 3004 in Sched 3 to the Migration Regulations, unless the decision maker is satisfied that there are compelling reasons for not applying those criteria. As the appellant was not the holder of a substantive visa, a diplomatic visa, or a special purpose visa, he was required by criterion 3001 to lodge his application for a visa within 28 days after the "relevant day". If he failed to do so, the appellant could only satisfy the criteria in cl 820.211 if, by cl 820.211(2)(d)(ii), the decision maker "is satisfied that there are compelling reasons for not applying [the Sched 3] criteria". Secondly, cl 820.223(1)(a) of Sched 2 to the Migration Regulations required that an applicant must satisfy various public interest criteria. One of those, public interest criterion 4004, contained in Sched 4 to the Migration Regulations, provided as follows: "The applicant does not have outstanding debts to the Commonwealth unless the [decision maker] is satisfied that appropriate arrangements have been made for payment." 44 Migration Act 1958 (Cth), s 65(1)(a)(ii). Edelman The decisions below The Tribunal The Tribunal affirmed the decision of the delegate of the Minister not to grant a visa to the appellant. Two reasons were given, respectively relating to the relevant criteria set out above. First, the Tribunal found that the last day that the appellant held a substantive visa was 7 November 2005, when his student visa expired. That was the "relevant day" for criterion 3001. The Tribunal therefore concluded that the application for a partner visa, made in May 2015, was made more than 28 days after the relevant day. The Tribunal then turned to whether there were any "compelling reasons" not to apply criterion 3001. The Tribunal held that the compelling reasons must exist at the time of the application. After considering all the circumstances at that time, including the appellant's immigration history, many aspects of his relationship with his partner and her children, and his and his partner's medical evidence, the Tribunal concluded that it was not satisfied that there were compelling reasons not to apply criterion 3001. The second reason given by the Tribunal for affirming the decision of the delegate of the Minister was that the appellant had not satisfied public interest criterion 4004. In oral evidence before the Tribunal, the appellant confirmed that he had an outstanding debt to the Commonwealth following his visa applications and applications for judicial review. He said that he intended to repay the debt but had not made any arrangements to do so. The appellant's representative suggested that the appellant was waiting for a "final bill", and that the appellant would make arrangements to repay the debt when all bills were combined. However, in circumstances where the first debt accrued more than a decade earlier, the Tribunal did not accept that the appellant had any intention to repay the debt. The Tribunal also observed that "some days after the [appellant] attended the hearing, he has not presented any evidence that he has made the repayments or that he had made any arrangements to repay the debt". The Tribunal's decision was delivered on 25 February 2016. May 2016, the appellant repaid his debt to the Commonwealth. The Federal Circuit Court and the Full Court of the Federal Court In the Federal Circuit Court, as in the Full Court of the Federal Court and in this Court, it was common ground that the Tribunal had made an error of law in relation to criterion 3001 by considering whether compelling circumstances existed at the time of the application. The Tribunal erred because it should have considered whether compelling circumstances existed at the time of its decision. The Federal Circuit Court (Judge Street) held that this error was a the Tribunal's decision was that Edelman independently supported by its conclusion that the appellant had not satisfied public interest criterion 4004. Judge Street held that the grant of a writ of certiorari was not inutile and should not be denied in the exercise of discretion. His Honour pointed to the payment of the debt by the appellant following the decision of the Tribunal45. The application for judicial review was therefore allowed and writs of certiorari and mandamus were issued, quashing the decision of the Tribunal and requiring the Tribunal to determine the review application according to law. The Full Court, by majority, allowed the Minister's appeal. The majority (Flick and Farrell JJ) held that the Tribunal's error in relation to criterion 3001 was a jurisdictional error46. Nevertheless, their Honours allowed the appeal because they held that the Tribunal retained jurisdiction to determine the separate issue concerning public interest criterion 400447. In contrast, Mortimer J would have dismissed the appeal. Her Honour held that in determining whether an error is jurisdictional it is not possible to isolate an error of law from the ultimate decision on the review48. As will be seen below, that view of jurisdictional error is correct. A jurisdictional error cannot be so isolated because a finding of jurisdictional error means that the ultimate decision was made without authority. However, her Honour considered that, notwithstanding the existence of an independent ground for the decision, the error of law by the Tribunal was of sufficient gravity that it should be treated as jurisdictional49. Alternatively, her Honour said, the error of law by the Tribunal had infected the Tribunal's reasoning concerning public interest criterion 4004. This meant that the error of law should be treated as jurisdictional because it might have led to a different result concerning public interest criterion 400450. Neither of these alternatives should be accepted. 45 Hossain v Minister for Immigration and Border Protection [2016] FCCA 1729 at 46 Minister for Immigration and Border Protection v Hossain (2017) 252 FCR 31 at 47 (2017) 252 FCR 31 at 40 [30]. 48 (2017) 252 FCR 31 at 49 [67]. 49 (2017) 252 FCR 31 at 49 [66]. 50 (2017) 252 FCR 31 at 49-50 [71]-[72]. Edelman The basis for the writ of certiorari to quash a decision On the application to the Federal Circuit Court for judicial review of the Tribunal's decision, the Federal Circuit Court had, with some exceptions discussed below, the same original jurisdiction as that which this Court has under s 75(v) of the Constitution51. The original jurisdiction conferred upon the High Court by s 75(v) extends to matters "in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth". Despite the omission of certiorari in s 75(v), a writ of certiorari is available in original jurisdiction at least where it is ancillary to writs of mandamus or prohibition52. In the Federal Circuit Court, the appellant was granted a writ of mandamus in addition to a writ of certiorari, and it was assumed by all parties that the latter was ancillary to the former (although mandamus had not apparently been sought by the appellant). Hence, it is unnecessary to consider whether certiorari might be available in wider circumstances, including whether it could be seen as an application of the essential meaning of s 75(v) or, put another way, as a "species of the same genus"53 as the other remedies in s 75(v), when those remedies are properly understood54 without the erroneous assumption that certiorari involves appellate jurisdiction55. Nevertheless, this appeal requires consideration of the reasons that a writ of certiorari is generally ordered in respect of a decision made under statute, so as to appreciate the nature of the requirement of materiality that was the focus of the appeal. Where the unlawfulness of a decision made under statute arises from an error by the statutory decision maker, there are two overlapping categories of 51 Migration Act 1958 (Cth), s 476(1). 52 R v The District Court; Ex parte White (1966) 116 CLR 644 at 655; [1966] HCA 69; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 90-91 [14]; [2000] HCA 57; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 507 [81]; [2003] HCA 2; Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651 at 672-673 [61]-[64]; [2007] HCA 14. Cf Aitken, "The High Court's Power to Grant Certiorari – The Unresolved Question", (1986) 16 Federal Law Review 370 at 374. 53 Gummow, "The Scope of Section 75(v) of the Constitution: Why Injunction But No Certiorari?", (2014) 42 Federal Law Review 241 at 251. 54 Muin v Refugee Review Tribunal (2002) 76 ALJR 966 at 977 [47]; 190 ALR 601 at 615; [2002] HCA 30. 55 Leeming, Authority to Decide: The Law of Jurisdiction in Australia, (2012) at 250; Gummow, "The Scope of Section 75(v) of the Constitution: Why Injunction But No Certiorari?", (2014) 42 Federal Law Review 241 at 243. Edelman error that can lead to a writ of certiorari. The first category comprises errors that have the consequence that the decision maker had no authority to make the decision. The second comprises errors that appear on the face of the record, irrespective of whether the decision maker had authority to make the decision. The categories overlap because an error in the second category could mean that the decision itself was unlawful and without authority. But an error might also fall within the second category if a step in the process by which the decision was reached was unlawful, even where the decision was made with authority. The first category of error, which results in a lack of authority for the decision, is sometimes described as having the consequence that the decision was beyond power. Its consequence has been said, in terms that create difficulty56, to be that the decision is a nullity or void. Nevertheless, it is established that the effect of an error of that type is that the "decision ... lacks legal foundation and is properly regarded, in law, as no decision at all"57 (emphasis added). In contrast, if an error of law on the face of the record does not deprive the decision maker of authority, then the decision will have legal foundation. In a passage described by Wade as "the one usage which is based on an intelligible distinction"58, Dr Rubinstein attempted to illustrate the difference in consequences between (i) an error that has the effect that a decision was made without authority, and (ii) other errors of law on the face of the record, by using the contrasting labels of a "void" and a "voidable" decision59. Those labels have been deprecated60 but they have the benefit of highlighting the contrast between a decision that has no legal foundation, and one that is unlawfully made although it has a lawful foundation until set aside. The essential difference of principle in Australian law is not between the overlapping categories of decisions made without authority and all decisions that 56 Leeming, "The riddle of jurisdictional error", (2014) 38 Australian Bar Review 139 at 148-149; Wade, "Unlawful Administrative Action: Void or Voidable?", (1967) 83 Law Quarterly Review 499. 57 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at 614-615 [51]; [2002] HCA 11. See also Forrest, "The physics of jurisdictional error", (2014) 25 Public Law Review 21 at 29. 58 Wade, "Unlawful Administrative Action: Void or Voidable?", (1967) 83 Law Quarterly Review 499 at 520, see also at 521 discussing Director of Public Prosecutions v Head [1959] AC 83 at 110-112. 59 Rubinstein, Jurisdiction and Illegality: A Study in Public Law, (1965) at 4-5. 60 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR Edelman involve errors of law on the face of the record. Instead, the distinction of principle is between errors characterised as jurisdictional errors and errors characterised as non-jurisdictional errors of law on the face of the record. There are some different consequences that arise from errors that deprive a decision maker of authority compared with errors that do not. The most significant of these is the constraint upon State legislative power to exclude review of jurisdictional errors61. However, there are significant commonalities between the unlawfulness involved in jurisdictional errors and non-jurisdictional errors of law on the face of the record. Where the decision maker is exercising statutory power the legal requirements from which both errors are established arise by construction of the statute. That exercise of construction is not dependent solely on the literal text. Rather, the statute is construed in light of the background principles and history of judicial review62, as well as common law principles63, including the principle that the consequences of an error that a legislature will be taken to intend will usually depend on the gravity of the error64. If an error of either type has been committed, an order in the nature of certiorari operates "to remove the legal consequences [in cases of non- jurisdictional error of law on the face of the record], or purported legal consequences [in cases of jurisdictional error], of an exercise or purported exercise of power which has, at the date of the order, a discernible or apparent legal effect upon rights"65. In England, where a distinction between jurisdictional error and non- jurisdictional error has been reduced almost to vanishing point66, one focus has 61 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 581 [100]; [2010] HCA 1. See also Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 92 ALJR 248 at 271-272 [92]-[94]; 351 ALR 225 at 251-252; [2018] HCA 4. 62 Forsyth, "Of Fig Leaves and Fairy Tales: The Ultra Vires Doctrine, the Sovereignty of Parliament and Judicial Review", (1996) 55 Cambridge Law Journal 122 at 135. 63 Selway, "The Principle Behind Common Law Judicial Review of Administrative Action – The Search Continues", (2002) 30 Federal Law Review 217 at 226-228, contrasting the approaches of Mason J and Brennan J. 64 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 570-571 [64]. 65 Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 92 ALJR 248 at 257 [28]; 351 ALR 225 at 232. 66 Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147, as explained in R v Hull University Visitor; Ex parte Page [1993] AC 682 at 701-702. See also R (Cart) v Upper Tribunal [2012] 1 AC 663 at 683 [39], 702 [110]. Edelman become whether the error is "material"67. However, ultimately, "[b]oth tribunals and the courts are there to do Parliament's bidding"68. Likewise, in Australia, the requirement of materiality is a common restriction upon the issue of a writ of certiorari for both types of error. In cases of decision makers acting under statute, it will usually be implied from the statute that any error of law on the face of the record does not render a decision liable to be set aside unless, as a pre- condition, the error was material in the sense that it "affected" the decision69. The related nature of the two categories means that it would be curious if there were a usual implication of materiality for non-jurisdictional errors of law on the face of the record but no such usual implication for jurisdictional errors. However, on this appeal, it is unnecessary to explore the operation of a requirement of material error in the context of a non-jurisdictional error of law on the face of the record. The decision of the Tribunal, being one that fell within s 474(3)(b) of the Migration Act 1958 (Cth), was a "privative clause decision"70, which has the effect that a writ of certiorari from the Federal Circuit Court was available only for jurisdictional error71. The essential question on this appeal is whether a non-material error by the decision maker was a jurisdictional error. 67 R (Kambadzi) v Secretary of State for the Home Department [2011] 1 WLR 1299 at 1314 [31], [33], 1325 [69]; [2011] 4 All ER 975 at 993, 1004; R (Lumba) v Secretary of State for the Home Department [2012] 1 AC 245 at 275 [68], 312 [207]; R (Cart) v Upper Tribunal [2012] 1 AC 663 at 702 [110]. See also HK (Turkey) v Secretary of State for the Home Department [2007] EWCA Civ 1357, discussed in Stern, "The Rationale for the Grant of Relief by Way of Judicial Review and Potential Areas for Future Development", in Williams (ed), Key Issues in Judicial Review, (2014) 194 at 196-197. 68 R (Cart) v Upper Tribunal [2012] 1 AC 663 at 683 [37]. 69 Craig v South Australia (1995) 184 CLR 163 at 176; [1995] HCA 58; Victoria Pre Cast Pty Ltd v Papazisis [2003] VSC 208 at [8]; Wilson v County Court of Victoria (2006) 14 VR 461 at 471 [43]; Grocon Constructors Pty Ltd v Planit Cocciardi Joint Venture (No 2) (2009) 26 VR 172 at 204-205 [121]; Combined Enterprises Pty Ltd v Brister [2016] VSC 807 at [21]. See also Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 353, 384; [1990] HCA 33. 70 See Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 506 [76]- [77]; Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 581 [100]. 71 Migration Act 1958 (Cth), s 476(1); ARP15 v Minister for Immigration and Border Protection [2015] FCA 1220 at [43]. See also Bhullar v Minister for Immigration and Citizenship [2010] FCA 1337 at [5]. Edelman Certiorari for material breach of a pre-condition to exercise of power and residual discretion Jurisdictional error requires materiality In Attorney-General (NSW) v Quin72, Brennan J said that in Australia the development and expansion of judicial review had "been achieved by an increasingly sophisticated exposition of implied limitations on the extent or the exercise of statutory power". The broad test for determining whether an implied legislative condition is jurisdictional was set out by McHugh, Gummow, Kirby and Hayne JJ in Project Blue Sky Inc v Australian Broadcasting Authority73. Their Honours said that it was necessary to "ask whether it was a purpose of the legislation that an act done in breach of the provision should be invalid". A close examination of legislation will usually have the effect that not every express or implied condition must be construed in a binary way. A legislative condition need not be construed as (i) always depriving a decision maker of power, or (ii) never doing so, no matter how it is breached. The question is always one of construction of the legislation: which breaches of a provision does the legislation, either expressly or, more commonly, impliedly74, treat as depriving the decision maker of power? Just as it is unlikely to be concluded that Parliament intended to authorise an unreasonable exercise of power75, so too it is unlikely to be an intention that the legislature is taken to have that a decision be rendered invalid by an immaterial error. An illustration of this point is the decision of this Court in Minister for Immigration and Citizenship v SZIZO76. In that case, the Refugee Review Tribunal failed to comply with the requirements of ss 441A and 441G of the 72 (1990) 170 CLR 1 at 36; [1990] HCA 21. 73 (1998) 194 CLR 355 at 390 [93]; [1998] HCA 28. 74 Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 666 [97]; [2012] HCA 31. 75 Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 36; Kruger v The Commonwealth (1997) 190 CLR 1 at 36; [1997] HCA 27; Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 650 [126]; [1999] HCA 21; Minister for Immigration and Citizenship v SZIAI (2009) 83 ALJR 1123 at 1127 [15]; 259 ALR 429 at 433; [2009] HCA 39; Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 350-351 [28], 362 [63], 370 [88]; [2013] HCA 18. 76 (2009) 238 CLR 627; [2009] HCA 37. Edelman Migration Act because it sent notice of the hearing to the first applicant only, instructing him to inform the other applicants of the hearing. All of the applicants attended the hearing and had the opportunity to participate. This Court said that the "admitted absurdity of the outcome is against acceptance of the conclusion that the legislature intended that invalidity be the consequence of departure from any of the procedural steps leading up to the hearing"77 (emphasis added). The decision in SZIZO illustrates a common manner in which this concept of materiality is part of the implication that a decision will not be invalid or beyond authority where the error could not have affected the result of the decision. Another example was contemplated in the joint judgment in this Court in Kirk v Industrial Court (NSW)78. In that case, the erroneous reversal of the onus of proof was a jurisdictional error. However, the joint judgment observed that there may be some departures from the rules of evidence that would not warrant the grant of relief in the nature of certiorari79. In other words, the joint judgment contemplated that a non-material departure from the rules of evidence might not be either a jurisdictional error or a material error of law on the face of the record. This approach to materiality as part of the implication concerning when an action by a decision maker will go beyond power can also be seen in the classic description by this Court of the range of possible jurisdictional errors in Craig v South Australia80. In that case, the Court gave examples of errors of law by an administrative tribunal that could be jurisdictional errors: identifying the wrong issue; asking the wrong question; ignoring relevant material; relying upon irrelevant material; and, in some circumstances, making an erroneous finding or reaching a mistaken conclusion. Speaking of the usual implication that arises from the statute, the Court said that if one of these errors is made: "and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error which will invalidate any order or decision of the tribunal which reflects it." (emphasis added) 77 (2009) 238 CLR 627 at 640 [35]. 78 (2010) 239 CLR 531. 79 (2010) 239 CLR 531 at 565 [53]. 80 (1995) 184 CLR 163 at 179. Edelman In Minister for Immigration and Multicultural Affairs v Yusuf81, McHugh, Gummow and Hayne JJ reiterated the usual implication that for an error to be jurisdictional, what "is important" is that the error is made "in a way that affects the exercise of power". More recently, in a context relevant to the availability of relief under s 75(v) of the Constitution in light of s 474 of the Migration Act, Gageler and Keane JJ described jurisdictional error as "a material breach of an express or implied condition of the valid exercise of a decision-making power conferred by that Act"82. In summary, although the issue will always be one of construction of the express or implied terms of the statute, an error will not usually be material, in this sense of affecting the exercise of power, unless there is a possibility that it could have changed the result of the exercise of power. In other words, materiality will generally require the error to deprive a person of the possibility of a successful outcome83. There may be unusual circumstances where an error is so fundamental that it will be material whether or not a person is deprived of the possibility of a successful outcome. One circumstance, for reasons that could include respect for the dignity of the individual84, may be an extreme case of denial of procedural fairness85. Another may be the circumstance discussed by Nettle J, where a decision maker fails to exercise jurisdiction to decide a question according to the applicable criterion. No such circumstances arise on this appeal. Residual discretion It is also necessary to distinguish the concept of materiality from the residual discretion to refuse relief, which was also the subject of submissions on this appeal. The concept of materiality, whether it is express or implied, is necessary for a conclusion that (i) a decision is beyond power or (ii) whether or not the decision is beyond power, there is an actionable error of law on the face of the record. In contrast, the residual discretion arises if certiorari would otherwise be available for one of those reasons. 81 (2001) 206 CLR 323 at 351 [82]; [2001] HCA 30. 82 Wei v Minister for Immigration and Border Protection (2015) 257 CLR 22 at 32 [23]; [2015] HCA 51. 83 Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326 at 341 [56]; [2015] HCA 40. See also Stead v State Government Insurance Commission (1986) 161 CLR 141; [1986] HCA 54. 84 R (Osborn) v Parole Board [2014] AC 1115 at 1149 [68]. 85 See DWN042 v Republic of Nauru (2017) 92 ALJR 146 at 151 [21]; 350 ALR 582 at 588; [2017] HCA 56. Edelman There has long been a residual discretion to refuse to issue a writ of certiorari even where a jurisdictional error is established. In R v Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust) Ltd86, this Court said that discretion might be exercised to refuse a writ of certiorari "if no useful result could ensue, if the party has been guilty of unwarrantable delay or if there has been bad faith on the part of the applicant, either in the transaction out of which the duty to be enforced arises or towards the court to which the application is made". Reference to the potential exercise of discretion where no useful result could ensue thus looks forward to the utility of another hearing. Although the residual discretion is not confined to being "forward looking", it contrasts with the usual consideration of materiality, discussed above, which looks backwards to whether the error would have made any difference to the result. Materiality is a requirement for jurisdictional error in s 65(1)(a)(ii) As set out above, s 65(1)(a)(ii) of the Migration Act required the appellant to fulfil requirements including the "criteria ... prescribed by ... the regulations". To grant a visa, the decision maker had to be so satisfied87. On review, the Tribunal could "exercise all the powers and discretions"88 conferred on the decision maker by the Act, and had power, among other things, to affirm or vary the decision, or set aside the decision and substitute its own89. The context and terms of s 65 require the usual implication that an immaterial error will not invalidate a decision made under that section. The essential issue is whether an error by the Tribunal in its reasoning on one criterion was material, and jurisdictional, if the error could not have affected the other criterion on which the visa was refused. The appellant, relying in part upon the reasoning of Mortimer J, submitted that the error of law made by the Tribunal in relation to criterion 3001 was not independent of the Tribunal's consideration of public interest criterion 4004. In oral submissions, the appellant submitted that it was possible to infer that absent the error of law by the Tribunal, and consistently with the requirements of public 86 (1949) 78 CLR 389 at 400; [1949] HCA 33. See also SZBYR v Minister for Immigration and Citizenship (2007) 81 ALJR 1190 at 1197-1198 [28]; 235 ALR 609 at 618; [2007] HCA 26. 87 Plaintiff S297/2013 v Minister for Immigration and Border Protection (2014) 255 CLR 179 at 188-189 [34]; [2014] HCA 24. 88 Migration Act 1958 (Cth), s 349(1). 89 Migration Act 1958 (Cth), s 349(2). Edelman interest criterion 4004, the appellant would have repaid his debt or would have satisfied the Tribunal that he had made appropriate arrangements to repay the debt before the Tribunal gave its decision. This inference was said to arise from: (i) the fact of the amount of the debt, $7,404; (ii) the fact that the appellant's partner had an income; and (iii) the fact that the debt was repaid in May 2016. The error in this submission is that an assessment of whether an error was material, in the sense that it affected the exercise of power by depriving a person of the possibility of a successful outcome, does not take place in a universe of hypothetical facts. The materiality of the error is assessed against the existing facts before the Tribunal. Those existing facts were that the appellant had not repaid his debt nor had he made arrangements to do so. As the Tribunal observed, (i) these requirements had not been satisfied at the time of the hearing before it and (ii) nine days later, at the time of its decision, the appellant had not presented any evidence that he had repaid, or made arrangements to repay, the debt. There is no evidence that the appellant sought any adjournment of the hearing before the Tribunal, or that he requested any delay before the Tribunal delivered its decision, to file any evidence about repayment of his debt or arrangements he had made to repay his debt. The error of law by the Tribunal in relation to criterion 3001 therefore did not deprive the appellant of the possibility of a successful outcome. On the contrary, the Tribunal was required to affirm the decision of the delegate of the Minister because the appellant had not satisfied public interest criterion 4004. One requirement for the grant of a visa, contained in s 65(1)(a)(ii), was that criteria prescribed by the Migration Regulations are satisfied. That requirement was not met because public interest criterion 4004 was not satisfied. As a matter of construction of the Migration Act, the error of law made by the Tribunal in relation to criterion 3001 could not have deprived the Tribunal of its authority to make a decision that it was required to make due to its conclusion in relation to public interest criterion 4004. The error of law by the Tribunal was immaterial. It was not a jurisdictional error. Conclusion and orders The only errors by the Tribunal that could be reviewed were those that were jurisdictional. The absence of a jurisdictional error by the Tribunal meant that there was no power to issue a writ of certiorari to quash the decision of the Tribunal90. The appeal must be dismissed with costs. 90 Migration Act 1958 (Cth), s 476; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 506 [76]-[77].
HIGH COURT OF AUSTRALIA APPELLANT AND THE DIRECTOR OF PUBLIC PROSECUTIONS FOR WESTERN AUSTRALIA RESPONDENT White v Director of Public Prosecutions (WA) [2011] HCA 20 8 June 2011 Appeal dismissed with costs. ORDER On appeal from the Supreme Court of Western Australia Representation S A Shirrefs SC with H J E van den Heuvel for the appellant (instructed by B Fiannaca SC with I S Jones for the respondent (instructed by Director of Public Prosecutions for Western Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS White v Director of Public Prosecutions (WA) Criminal law – Procedure – Confiscation of proceeds of crime and related matters – Forfeiture and confiscation of property – Section 22 of Criminal Property Confiscation Act 2000 (WA) ("Act") relevantly required court to make crime-used property substitution declaration where crime-used property not available for confiscation because offender did not own, and did not have effective control of, property and more likely than not that offender made criminal use of crime-used property – Section 147 of Act provided offender makes criminal use of property if, alone or with anyone else, offender used or intended to use property in way that brings property within definition of crime-used property – Section 146(1)(c) provided property "crime-used" if any act or omission done, omitted to be done or facilitated in or on property in connection with commission of confiscation offence – Where DPP applied for crime-used property substitution declaration against appellant – Where not disputed that premises leased by appellant "crime-used" within s 146(1)(c) of Act – Whether definition of "criminal use" in s 147 of Act encompassed conduct within definition of "crime-used" in s 146(1)(c) of Act. Words and phrases – "crime-used property", "criminal use", "property". Criminal Property Confiscation Act 2000 (WA), ss 21, 22, 146, 147. FRENCH CJ, CRENNAN AND BELL JJ. Introduction The Criminal Property Confiscation Act 2000 (WA) ("the Act") provides for the confiscation of property used in criminal offences. Where property so used neither belongs to nor is effectively controlled by the offender, s 22 of the Act enables a declaration to be made, on the application of the Director of Public Prosecutions ("the DPP"), that property owned by the offender is available for confiscation instead of the crime-used property. Such an order is called a crime- used property substitution declaration1. A judge of the Supreme Court of Western Australia dismissed an application for such a declaration against the appellant, who had been convicted in 2003 of a wilful murder committed in 20012. An appeal to the Court of Appeal of the Supreme Court of Western Australia by the DPP was allowed3. On 25 March 2010, the Court of Appeal made the declaration sought by the DPP. The wilful murder, of which the appellant was convicted, was committed immediately outside the boundary fence of fenced and gated premises at 10 Jade Street, Maddington, Western Australia. At the time of the offence the appellant was leasing those premises. The appellant had shot at the deceased five times inside the premises, the gates to which had been locked at the appellant's direction. At least two of the shots wounded the deceased. The deceased climbed over one of the locked gates to escape the appellant, but was fatally shot while on the ground outside the gate. The sentencing judge described the killing as "a cold-blooded execution". The appellant was sentenced to strict-security life imprisonment with a non-parole period of 22 years. A "crime-used property substitution declaration" can be made if "the crime-used property is not available for confiscation"4 and if "it is more likely than not that the [appellant] made criminal use of the crime-used property"5. It was accepted in the litigation that the rented premises were not available for confiscation. Thus, the questions raised by this appeal are whether the premises, 1 Act, s 3 and Glossary. 2 Director of Public Prosecutions (WA) v White (2009) 194 A Crim R 192. 3 Director of Public Prosecutions (WA) v White (2010) 199 A Crim R 448. 4 Act, s 22(1)(a). 5 Act, s 22(1)(b). Crennan Bell leased by the appellant, were "crime-used property" within the meaning of s 146 of the Act and whether he made "criminal use" of those premises within the meaning of s 147 of the Act. Those are necessary conditions for the making of a declaration under s 22. On their proper construction and application to the facts of this case, both conditions were fulfilled. The appeal against the decision of the Court of Appeal should be dismissed. Factual background On the appeal to this Court, the parties were on common ground as to relevant facts before the jury. Those facts, which were set out in the written submissions filed on behalf of the appellant, may be summarised as follows: The premises at Jade Street, Maddington, were in an industrial area. The appellant rented them and operated a trucking business from them. The premises were surrounded by a cyclone fence. Entry was gained through two gates, each six-feet high, surmounted by three strands of barbed wire and with a chain and two padlocks. On 19 August 2001, the deceased attended the property with a Mrs Miller for the purpose of obtaining amphetamines. Both had consumed alcohol and amphetamines earlier. When they arrived, there were three young women already at the premises, two unidentified men, and a man known as Rainbow. On that day, the appellant instructed Sidney Reid to go to the premises, lock the gates and not let anyone come in or out. He did not give Reid a reason for this instruction. Reid complied with the appellant's instructions. He drove to the property, parked his car there, and asked Rainbow, who had a key, to lock the gates. Rainbow did so. He and Rainbow then went up to the house. The appellant denied that he had telephoned Reid asking him to close the gates. He accepted that the deceased and Mrs Miller may have turned up at the property unannounced. The appellant and one Richard Samuels drove to the property and arrived there shortly after the gates had been locked. They unlocked the gates, drove the car onto the property, locked the gates behind them and walked to the house. Crennan Bell The appellant told Mrs Miller and the other women to leave the premises. They left in a car. Rainbow unlocked the gates to let the women out. He then relocked them. The appellant confronted the deceased about the repayment of money. The deceased did not reply. The appellant said he would make an example of him. As the deceased walked from the house towards the back of the property, he was followed by the appellant, who produced a gun and shot him in the left shoulder. The deceased ran from the appellant who fired a further three shots at the deceased, before the deceased reached the locked gates. The deceased climbed the locked gates to leave the premises. As he reached the top of the gates, the appellant shot him in the buttocks. The deceased came down on the other side of the gates and collapsed on the ground. The appellant then unlocked the gates, walked out of the premises and shot the deceased in the head, killing him. He then moved the deceased's body onto the premises before transporting and disposing of it. Statutory framework The Act provides "for the confiscation in certain circumstances of property acquired as a result of criminal activity and property used for criminal activity"6. A key term in the Act is "property", defined in the Glossary to the Act real or personal property of any description, wherever situated, whether tangible or intangible; or a legal or equitable interest in any property referred to in paragraph (a)". The definition is more limited than the usage of the term "property" in parts of the Act where it plainly refers to the land or things which are the subject of property interests. Its usage is considered later in these reasons. 6 Act, long title. Crennan Bell The Act provides in s 21 that the DPP may apply to a court for a "crime- used property substitution declaration against a person"7. The form of such a declaration and the conditions under which it must be made are set out in s 22. If the conditions are satisfied, a declaration must be made by the court "that property owned by the respondent is available for confiscation instead of crime- used property"8. The conditions are that9: the crime-used property is not available for confiscation as mentioned in subsection (2); and it is more likely than not that the respondent made criminal use of the crime-used property". The crime-used property is not available for confiscation if the respondent does not own and have effective control of it10. There is a presumption that property is crime-used where the respondent has been convicted of a relevant confiscation offence11. The presumption appears to be activated by the fact of the allegation, in proceedings under s 21, that the property was "crime-used" in relation to the confiscation offence. Otherwise, the applicant for the declaration bears the onus of establishing that the respondent made criminal use of the property12. The term "relevant confiscation offence" is defined in the Glossary to the Act to mean: "the confiscation offence or suspected confiscation offence that is relevant to bringing the property within the scope of this Act". The court is required, when making a declaration under s 22, to assess the value of the crime-used property in accordance with s 23 and to specify that value in the declaration13. 7 Act, s 21(1). 8 Act, s 22(1). 9 Act, s 22(1)(a) and (b). 10 Act, s 22(2)(a). 11 Act, s 22(3). 12 Act, s 22(5). 13 Act, s 22(6). Crennan Bell The terms "crime-used" and "criminal use" are defined in ss 146 and 147 of the Act. Section 146 relevantly provides: "(1) For the purposes of this Act, property is crime-used if — the property is or was used, or intended for use, directly or indirectly, in or in connection with the commission of a confiscation offence, or in or in connection with facilitating the commission of a confiscation offence; the property is or was used for storing property that was acquired unlawfully in the course of the commission of a confiscation offence; or (c) any act or omission was done, omitted to be done or facilitated in or on the property in connection with the commission of a confiscation offence. (3) Without limiting subsection (1) or (2), any property in or on which an offence under Chapter XXII or XXXI of The Criminal Code is committed is crime-used property."14 As will be apparent, crime-used property is not limited to any land or thing in which the offender has or has ever had any interest, or which is or has ever been controlled by the offender. Section 147 provides: "For the purposes of this Act, a person makes criminal use of property if the person, alone or with anyone else (who need not be identified) uses or intends to use the property in a way that brings the property within the definition of crime-used property." Before turning to the constructional issues raised on the appeal, it is necessary to consider the way in which the word "property" is used in ss 22, 146 and 147. The ordinary meaning of the word "property" is "[t]hat which one owns; a thing or things belonging to a person or persons …" and "[a] house or piece of land owned"15. In law, "property" generally refers not to a thing but to 14 Chapter XXII deals with offences against morality. Chapter XXXI deals with sexual offences. 15 Shorter Oxford English Dictionary, 6th ed (2007) at 2370. Crennan Bell "a legal relationship with a thing"16. In Telstra Corporation Limited v The Commonwealth17, this Court observed that in many cases it may be helpful to speak of property as "a bundle of rights"18. At other times it may be more helpful to speak of property as "a legally endorsed concentration of power over things and resources"19. The Court said that20: "Seldom will it be useful to use the word 'property' as referring only to the subject matter of that legally endorsed concentration of power." Nevertheless, as Latham CJ pointed out, in Minister of State for the Army v Dalziel21 the term "property" is ambiguous22: "As applied to land it may mean the land itself in relation to which rights of ownership exist, or it may refer to the rights of ownership which exist in relation to the land." An example of an interpretation of a contract according to the ordinary meaning of "property" may be seen in the judgment of Barwick CJ in Travinto Nominees Pty Ltd v Vlattas23. There the words "error or misdescription of the property", appearing in standard terms of a contract for the sale of land, were construed as referring to misdescription of the land the subject matter of the sale. The term "property" used in a statute may take its ordinary meaning, its legal meaning, or both meanings. The interpretation of the term depends upon 16 Yanner v Eaton (1999) 201 CLR 351 at 365-366 [17] per Gleeson CJ, Gaudron, Kirby and Hayne JJ; [1999] HCA 53. 17 (2008) 234 CLR 210; [2008] HCA 7. 18 (2008) 234 CLR 210 at 230-231 [44]. 19 (2008) 234 CLR 210 at 230-231 [44]. 20 (2008) 234 CLR 210 at 230-231 [44]. 21 (1944) 68 CLR 261 at 276; [1944] HCA 4. 22 See also, McCaughey v Commissioner of Stamp Duties (1946) 46 SR (NSW) 192 at 23 (1973) 129 CLR 1 at 15, 26 per McTiernan J, 29 per Menzies J and 37 per Stephen J agreeing with McTiernan J; [1973] HCA 14. Crennan Bell the context and purpose of the provision in which it is found. Section 146(1)(b) of the Act refers to "property … used for storing property". That usage may be taken to include the exercise of rights over the land or a thing (eg, a container) to store property. It may also extend to the use of things which are the subject of property rights. That extension is intended as appears from s 146(1)(c) which speaks of things done "in or on the property". It follows that the term "property" used in s 146, and therefore having a similar usage in ss 22 and 147, covers the use of property rights of the kind defined in the Glossary and the use of things which are the subject of property rights. The primary judge's decision The primary judge held that the premises were crime-used property24. In so holding, her Honour relied upon s 146(1)(c) and not upon s 146(1)(a). Her Honour doubted that it could be said that the premises were used in, or in connection with, the commission of the offence of wilful murder in the sense contemplated by s 146(1)(a). It was straining ordinary speech to say that, because the fence and gates were used in connection with the offence, the premises were also used in that connection25. The premises, however, were held to be crime-used property within the meaning of s 146(1)(c). This was because the deceased was shot by the appellant while he was on the premises and the acts of the appellant were "in connection with" the ultimate fatal shot which was discharged with an intent to kill. Even putting the earlier shots to one side, the appellant's penultimate shot, fired while he was standing on the premises, had a clear connection to the fatal shot which he fired with an intention to kill26. Her Honour went on to hold, however, that this conclusion would not support a finding that the appellant had made criminal use of the premises within the meaning of s 147. Her Honour held, in effect, that while conduct by the appellant rendering property "crime-used" within the meaning of ss 146(1)(a) and (b) would constitute criminal use of the property for the purposes of s 147, the same was not true of conduct by the appellant only caught by s 146(1)(c)27. 24 (2009) 194 A Crim R 192 at 212 [101]. 25 (2009) 194 A Crim R 192 at 211 [97]. 26 (2009) 194 A Crim R 192 at 212 [99], [100]. 27 (2009) 194 A Crim R 192 at 212-213 [103]-[109]. Crennan Bell The decision of the Court of Appeal The Court of Appeal held, contrary to the finding of the primary judge, that the property was crime-used within the meaning of s 146(1)(a). In so doing, the Court held that it was not necessary, for the application of s 146(1)(a), that the act or acts constituting the relevant use had to be done with the intention or purpose of committing the specific unlawful act constituting the confiscation offence. The use of the premises for the purposes of s 146(1)(a) could be "indirectly in connection with the facilitation of a confiscation offence."28 The Court of Appeal also held, contrary to the primary judge's conclusion, that the primary defined term in ss 22, 146 and 147 is "crime-used" and that it incorporates the word "used" to encompass all the activities listed in ss 146(1) and (3). This indicates that all those activities are intended to be uses for the purposes of s 14729. The Court of Appeal allowed the appeal and set aside the orders made by the primary judge. The appellant's argument The steps in the appellant's argument in this Court may be summarised as follows: A crime-used property substitution declaration, under s 21 of the Act, cannot be made against a person unless that person made criminal use of the crime-used property within the meaning of s 147 of the Act. Contrary to the conclusion of the Court of Appeal, the premises at Maddington were not crime-used within the meaning of s 146(1)(a). The Court of Appeal's finding to the contrary was based on factual conclusions not open on the evidence. It was not disputed that the premises were crime-used property within the meaning of s 146(1)(c). The conduct covered by s 146(1)(c) did not establish criminal use of the property by the appellant within the meaning of s 147. 28 (2010) 199 A Crim R 448 at 457 [39]. 29 (2010) 199 A Crim R 448 at 459 [48]. Crennan Bell As appears from the above, the appellant's appeal must fail unless he can show that the conduct referred to in s 146(1)(c) does not constitute "criminal use" of property for the purposes of s 147. If the conduct referred to in s 146(1)(c) does constitute "criminal use" then, having regard to the undisputed application of that paragraph to the facts of this case, the necessary conditions for the making of a crime-used property substitution declaration under s 21 were satisfied. It is desirable therefore, to turn first to that question of construction. The construction of "criminal use" under s 147 As was submitted by the appellant, s 146(1)(c) has a broad application. It covers cases in which acts or omissions were done or facilitated in or on the property in connection with the commission of a confiscation offence. On the face of it, the mere doing of an act in or on a property in connection with the commission of a confiscation offence, does not necessarily fit comfortably within the concept of use applied to property. The relevant ordinary meaning of the verb "use" is to "[m]ake use of (a thing), esp. for a particular end or purpose; utilize, turn to account"30. According to that ordinary meaning, "use" would be a subset of the class of conduct described in s 146(1)(c). However, the relationship which the words "in connection with" forge between "act or omission done on the property" and "the commission of a confiscation offence" suggests that even though it may involve an extension of the verb "use", the conduct described in s 146(1)(c) can be brought within the meaning "makes criminal use of property" in s 147, without doing violence to the language of the latter section. In this case, purpose and context favour that interpretation. The appellant submitted that the word "use" in s 147 refers only to the categories of conduct in s 146(1)(a) and (b) as conduct bringing the property within the alternative definitions of crime-used property in those two paragraphs. That interpretation, however, gives rise to a disconformity between ss 146 and 147. As appears from the conditions in s 22(1) to which they relate, the two provisions complement each other. The disconformity is removed and complementarity is effected if the term "definition of crime-used property" in s 147 is construed as picking up each of the alternative definitions in s 146(1) and (3). The latter construction is supported by reference to s 82 of the Act, which provides for the setting aside of freezing notices and freezing orders made under the Act. A court may set aside a freezing notice, or order affecting property, if an objector establishes, inter alia, that it is more likely than not that the objector is 30 Shorter Oxford English Dictionary, 6th ed (2007) at 3484. Crennan Bell an owner31 and an innocent party32, and that the property is not effectively controlled by a person who made criminal use of the property33. The construction of s 147 for which the appellant contended, would, as the DPP submitted, be inconsistent with the apparent intentions of ss 82(4) and 87. On the construction of s 147 advanced by the appellant, a person who did not own the property, but effectively controlled it, and whose acts rendered the property crime-used within the meaning of s 146(1)(c), would be entitled to have a freezing order set aside, or to have the crime-used property returned after confiscation. A person in the same position, whose act rendered the property crime-used under s 146(1)(a) or (b), would not be so entitled. The appellant's construction of s 147 not being accepted, this appeal cannot succeed. It is unnecessary to consider the other contentions advanced by the appellant in relation to the construction of s 146(1)(a) and its application to the facts of the case. Conclusion For the preceding reasons the appeal should be dismissed with costs. 31 Act, s 82(4)(a). 32 Act, s 82(4)(c). 33 Act, s 82(4)(b). GUMMOW J. In Re Director of Public Prosecutions; Ex parte Lawler34, "Confiscation of property connected with the commission of crimes was long part of the common law and had its origin in the doctrines of attainder and deodand35. Property could be forfeited even if its owner was not involved in the crime36. Forfeiture at common law was abolished in England in 1870 and thereafter in this country37, but statutory powers of forfeiture have remained in certain areas and, indeed, have been introduced in some new areas38." The Criminal Property Confiscation Act 2000 (WA) ("the Act"), with which this appeal is concerned, is one of those new areas. Unlike the federal legislation in issue in Lawler, the provisions of the Act are not directed to the confiscation of what may be the assets of innocent persons, but rather to those of persons such as the appellant, who was convicted of wilful murder. To that end, the Act looks to property with one or more defined characteristics, including "crime-used property" and "crime-derived property". Further, as the joint reasons explain, the term "property" is used in the Act in several senses which reflect the ambulatory terms of its definition in the Glossary of the Act. The complexities to which this state of affairs may give rise are illustrated by the facts in this case. The appellant rented the fenced and gated premises at 10 Jade Street, Maddington. The land later was valued, as at 19 August 2001, the date of the murder, at $265,000, inclusive of GST. As a 34 (1994) 179 CLR 270 at 289; [1994] HCA 10. See also Theophanous v The Commonwealth (2006) 225 CLR 101 at 125 [58]; [2006] HCA 18; and, as to deodands, the passage from Windeyer, Lectures on Legal History, (1938) at 19-20, set out by Callinan J in Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 316 [550]; [1999] HCA 62. 35 Freiberg, "Criminal Confiscation, Profit and Liberty", (1992) 25 Australian and New Zealand Journal of Criminology 44; Calero-Toledo v Pearson Yacht Leasing Co 416 US 663 at 680-682 (1974). 36 Mitchell v Torup (1766) Park 227 at 232-234 [145 ER 764 at 766]; Rolle, Un Abridgment des plusieurs Cases et Resolutions del Common Ley, (1668) at 530. 37 See, eg, Forfeitures for Treason and Felony Abolition Act 1878 (Vic). 38 See, eg, Crimes (Confiscation of Profits) Act 1986 (Vic). tenant he had the right to exclusive possession against all others including his landlord39, and this right he exercised. The tenancy gave the appellant an estate or interest in the land40, and the tenancy itself was "property" in the sense of the definition in the Glossary. However, for the land, or, more accurately, the title as registered proprietor under the Transfer of Land Act 1893 (WA), to be confiscated as "crime-used property", it would have been necessary that the appellant "owned" it (s 22(2)(a)). The exclusive possession given by his tenancy would not be sufficient for that purpose. A "crime-used property substitution declaration" could be made against the appellant if two criteria were met. The first was that "the crime-used property", here the parcel of land, the title to which was not owned by the appellant, was not available for confiscation (s 22(1)(a)). The litigation has been conducted on the footing that the criterion of non-availability was met. The dispute concerns the second criterion. This was that "it [was] more likely than not that [the appellant] made criminal use of the crime-used property" (s 22(1)(b)). The term "criminal use" is defined in s 147 and "crime-used" in If there was such use, as the Court of Appeal concluded there had been, then the court was to assess and specify the value of the crime-used property at the time of the murder (s 22(6), s 23(1)). The value of the land (ie $265,000) was to be its full value even if the appellant did not outlay any amount for the purpose of obtaining or making the criminal use of the property (s 23(2)). At the time of the hearing before the primary judge of the declaration application the appellant had a bank account balance in his favour of approximately $135,000. The bank account was the subject of a "freezing order" which had been obtained ex parte under s 41 of the Act. The declaration made by the Court of Appeal, which the appellant challenges, was: that property owned by GARY ERNEST WHITE is available for confiscation instead of crime-used property; and specifying, pursuant to s 22(6)(b) of the Act, the assessed value of the crime-used property is $265,000." 39 Chelsea Investments Pty Ltd v Federal Commissioner of Taxation (1966) 115 CLR 1 at 6-7; [1966] HCA 15. 40 Chelsea Investments Pty Ltd v Federal Commissioner of Taxation (1966) 115 CLR 1 at 6. Section 24 rendered the appellant liable to pay to the State an amount equal to $265,000, and s 26 provided that the frozen property might be applied towards satisfying that debt. The appellant, "in connection with" the commission of the murder, had done acts on the crime-used property within the meaning of par (c) of s 146(1). This was a use of the property in a way that, within the meaning of s 147, brought the property within par (c) of s 146(1) and, in turn, within the definition of "criminal use" in s 147. I agree with the reasons given by French CJ, Crennan and Bell JJ for those conclusions. The result is that the appellant made criminal use of the property and the criterion in s 22(1)(b) of the Act was satisfied. This enlivened the power to grant the declaration made by the Court of Appeal. The appeal should be dismissed with costs. HEYDON J. Section 22 of the Criminal Property Confiscation Act 2000 (WA) provides for the making of a "crime-used property substitution declaration". That declaration allows for the confiscation of property. One condition for its making is that the perpetrator of a crime does not own, or does not have effective control of, crime-used property. The appellant did not challenge the satisfaction of that condition in this case. The satisfaction of that condition meant that the Court was obliged to make the order in relation to other property owned by the appellant even though it was not used in the crime, provided that the appellant made "criminal use of the crime-used property". The only contention of the appellant which calls for consideration is that it was wrong of the Court of Appeal to have made a crime-used property substitution declaration on the ground that the appellant had not made "criminal use" of the premises from which he had committed the murder he had been convicted of. Did the appellant make "criminal use" of "crime-used property"? Section 147 provides that the appellant would have made "criminal use of property" if he had used it in a way that brought it within the definition of "crime-used property". The definition of "crime-used property" is in s 146. The trial judge found that the appellant's conduct only fell within s 146(1)(c), not within either par (a) or par (b) of s 146(1); and that the definition of "crime-used property" was only located in those two latter paragraphs. With respect, the Court of Appeal was correct to reject that construction of s 146(1). Before pars (a)-(c) of s 146(1) appear the words: "For the purposes of this Act, property is crime-used if". Paragraph (b) is followed by the word "or". There is no reason to treat pars (a) and (b) as being the only relevant parts of the sub-section governed by those opening words, and not par (c). The appellant submitted that s 147 does not encompass s 146(1)(c), as the circumstance that property falls within s 146(1)(c) "does not involve such property being 'used'." He also submitted that s 146(1)(c) "is referable to acts or omissions which occur on or in the property in connection with the commission of an offence and it is this deliberate act which brings the property within the defined term of 'crime-used' not the use or intended use of the property". But the fact that an act is done, omitted to be done or facilitated in or on property in connection with the commission of a confiscation offence within the meaning of s 146(1)(c) does not prevent the property being described as having been "used". On that ground the appellant's submission that s 147 applies only to activities within s 146(1)(a)-(b) and not to those within s 146(1)(c) must be rejected. The appeal must be dismissed.
HIGH COURT OF AUSTRALIA PETER KOSTAS & ANOR APPELLANTS AND HIA INSURANCE SERVICES PTY LIMITED T/AS HOME OWNERS WARRANTY & ANOR RESPONDENTS Kostas v HIA Insurance Services Pty Limited [2010] HCA 32 29 September 2010 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of New South Wales made on 16 September 2009 and, in lieu thereof, order that the appeal to that Court be dismissed with costs. First respondent to pay the costs of the appellants. On appeal from the Supreme Court of New South Wales Representation J T Gleeson SC with R J Carruthers for the appellants (instructed by Pryor Tzannes & Wallis) B W Walker SC with F R Clark and E Raper for the first respondent (instructed by Mills Oakley Lawyers) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Kostas v HIA Insurance Services Pty Limited Courts – Appeals – Jurisdiction and powers – Section 67(1) of Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) provided for appeal from Consumer, Trader and Tenancy Tribunal to Supreme Court "[i]f, in respect of any proceedings, the Tribunal decides a question with respect to a matter of law" – Appellants purported to terminate building contract because of builder's failure to meet obligations – Validity of termination turned on disputed claims for extension of time – Tribunal decided that material properly before it supported conclusion that disputed claims for extension had been served – Whether that question could be raised on appeal to Supreme Court – Whether "no evidence ground" raises question of law. Words and phrases – "question with respect to a matter of law", "no evidence ground". Consumer, Trader and Tenancy Tribunal Act 2001 (NSW), ss 66(2), 67. Home Building Act 1989 (NSW), ss 48A(1), 48K(1). Supreme Court Act 1970 (NSW), s 75A. Introduction The Consumer, Trader and Tenancy Tribunal of New South Wales ("the Tribunal") is a body set up by the Parliament of New South Wales to entertain a variety of commercial and consumer claims with the object of having such claims determined in an informal, expeditious and inexpensive manner1. Until 2008, an appeal lay from the Tribunal to the Supreme Court of New South Wales from a decision of "a question with respect to a matter of law"2. A dispute about the scope of that jurisdiction and the ancillary powers of the Supreme Court has led to this appeal. The appeal to this Court comes in the tenth year of a process which began in September 2000, when Peter and Christine Kostas commenced proceedings in what was then the Fair Trading Tribunal, a statutory predecessor of the Tribunal. The proceedings, which arose out of a dispute between Mr and Mrs Kostas, their builder and its statutory insurer3, HIA Insurance Services Pty Limited ("HIA"), concerned a $330,000 building contract. Mr and Mrs Kostas said they had validly terminated the contract on account of the builder's failure to meet its contractual obligations. The Tribunal decided that Mr and Mrs Kostas had not validly terminated the disputed contract. A judge of the Supreme Court, on appeal, held that they had and that the Tribunal had made a number of errors of law in reaching its decision4. On an appeal from the judge's decision, the Court of Appeal of the Supreme Court of New South Wales held that the judge did not have jurisdiction as there was no decision of a "question with respect to a matter of law" before him5. For the reasons that follow, the appeal to this Court from the Court of 1 Consumer, Trader and Tenancy Tribunal Act 2001 (NSW), s 3(c). 2 Consumer, Trader and Tenancy Tribunal Act 2001 (NSW), s 67(1). The Consumer, Trader and Tenancy Tribunal Act was amended by the Courts and Crimes Legislation Amendment Act 2008 (NSW). Appeals from the Tribunal under s 67 now lie to the District Court of New South Wales. 3 See Pt 6 of the Home Building Act 1989 (NSW), which prohibits the undertaking of "residential building work" unless a contract of insurance which complies with the Act and which is provided by an insurer approved by the Minister is in force in relation to the work: see ss 92 and 102. 4 Kostas v HIA Insurance Services Pty Ltd trading as Home Owners Warranty [2007] NSWSC 315. 5 HIA Insurance Services Pty Ltd v Kostas [2009] NSWCA 292. Appeal should be allowed. The Tribunal made a finding adverse to Mr and Mrs Kostas to the effect that the builder had properly given notice of claims for extensions of time. That was a finding for which there was no evidence before the Tribunal. It was critical to the Tribunal's conclusion that notices of default grounding the termination by Mr and Mrs Kostas were not valid. The primary judge acted within his jurisdiction and powers when he allowed the appeal against the Tribunal's decision. Procedural history Mr and Mrs Kostas' claim in the Tribunal was for indemnity under a Home Owners Warranty policy with HIA6. The claim related to loss and damage suffered because of the alleged failure by Sydney Construction Company Pty Ltd ("SCC") to complete contracted building works at their residence in Blakehurst. Mr and Mrs Kostas alleged that they had terminated the building contract. HIA denied liability. On 14 December 2000, SCC was joined as a defendant to the proceedings. It alleged that the purported termination of the contract was a wrongful repudiation, which it had accepted, and that it had been unable to complete its obligations because of the conduct of Mr and Mrs Kostas. The substantive hearing did not commence until 20 October 2003, more than three years after the proceedings were commenced7. Affidavit evidence was tendered and Mr Kostas and other witnesses were cross-examined. On 23 October 2003, the hearing was adjourned. It did not resume until 27 January 2004. It was again adjourned until 8 November 2004. Upon resumption of the hearing, Mr and Mrs Kostas and SCC agreed to withdraw their claims against each other. Mr and Mrs Kostas and HIA agreed, in relation to the continuing claim against HIA, that the Tribunal should determine as a preliminary question whether Mr and Mrs Kostas had lawfully terminated the building contract. Central to the debate on the preliminary question were letters alleging breaches of the building contract, sent by the solicitors for Mr and Mrs Kostas on 4 May 2000 and 12 May 2000 and addressed respectively to SCC and its solicitors. The breaches alleged were inability and unwillingness to complete the 6 Clause 42(1)(a)(i) of the Home Building Regulation 1997 (NSW) (made under s 103C of the Home Building Act) stipulated that, under an insurance contract required to be entered into under the Act, an insurer must be directly liable to a person on whose behalf residential building work covered by the contract is done. Similar provision is now made in cl 55(1)(a)(i) of the Home Building Regulation 2004 (NSW). 7 The Tribunal decided a preliminary point, not material for present purposes, in June 2002. work, suspension of work without reasonable cause and failure to proceed diligently with the work. The first letter gave notice, pursuant to cl 24 of the contract, that if the alleged breaches were not rectified within 10 working days the contract would be terminated. It also set out a list of 42 items said to be uncompleted work. The second letter referred to the notice given on 4 May and also gave notice to SCC that it had failed to rectify defective work and was required to do so. It repeated that unless the breaches of contract were remedied by SCC within 10 working days the contract would be terminated in accordance with cl 24. Mr and Mrs Kostas purported to terminate the contract by letter on 29 June 20008. On 4 July 2000, SCC's solicitors replied denying any entitlement to terminate and treating the purported termination as a repudiation. On 10 November 2004, counsel foreshadowed to the Tribunal the evidence they would rely upon in relation to the preliminary question. There followed a short re-examination of Mr Kostas. Written submissions were filed. By then, more than four years had elapsed since the proceedings had been commenced. On 25 May 2005, the Tribunal found that Mr and Mrs Kostas' purported termination was not effective and made an order, declaratory in form, that they had repudiated the contract. It made a direction for the filing of a minute of orders to give effect to its reasons9. On 22 June 2005, Mr and Mrs Kostas instituted an appeal against the decision of the Tribunal in the Supreme Court under s 67 of the Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) ("the CTTT Act")10. The section creates a right of appeal against a decision by the Tribunal of "a question with respect to a matter of law". 8 Their solicitors' letter of that date purported to terminate the contract as between Mr Kostas and SCC. That was consistent with the named parties to the building contract. However, when proceedings were commenced in the Tribunal, they were brought in the name of both Mr and Mrs Kostas. No point has been taken of this discrepancy. 9 Kostas v HIA Insurance Services Pty Ltd [2005] NSWCTTT 345. 10 Mr and Mrs Kostas also sought what they described as a "declaration in the nature of certiorari" on the ground of want of procedural fairness, presumably intending to invoke the jurisdiction of the Supreme Court under s 69 of the Supreme Court Act 1970 (NSW). The entitlement to prerogative relief was not the subject of any decision in the Supreme Court, nor was it agitated in this Court. The appeal was heard by Rothman J on 14, 15 and 21 June 2006. His Honour did not deliver judgment until 30 October 200711. The reasons for the substantial delay do not appear from the record. His Honour quashed the orders of the Tribunal made on 25 May 2005 and costs orders, which it had made on 20 September 2005. He declared that the termination of the building contract by Mr and Mrs Kostas was lawful and effective. He ordered that HIA pay their costs of the appeal and of the proceedings before the Tribunal. The matter was otherwise remitted to the Tribunal. By that time, more than seven years had passed since the commencement of the proceedings. On 16 September 2009, the Court of Appeal (Spigelman CJ, Allsop P and Basten JA) unanimously allowed HIA's appeal against the decision of the primary judge12. It did so substantially on the basis that what had been identified by the primary judge as decisions of the Tribunal on questions with respect to matters of law were not such as to attract the jurisdiction of the Supreme Court under s 67 of the CTTT Act. By this time, more than nine years had elapsed since Mr and Mrs Kostas had instituted their proceedings in the Tribunal. Special leave to appeal to this Court was granted by Gummow and Heydon JJ on 12 March 2010. The grounds of appeal are largely directed to the jurisdiction and powers conferred on the Supreme Court by s 67 of the CTTT Act. They require consideration of the legislative scheme relating to the Tribunal's way of operating and appeals from its decisions. The Tribunal's way of operating The Tribunal was established by the CTTT Act13. It replaced the Fair Trading Tribunal and the Residential Tribunal14. Its creation was the culmination of a process of amalgamation of smaller specialist tribunals. A number of the statutes creating the precursor tribunals made provision for referrals and appeals 11 Kostas v HIA Insurance Services Pty Ltd trading as Home Owners Warranty [2007] NSWSC 315. 12 HIA Insurance Services Pty Ltd v Kostas [2009] NSWCA 292. The appeal was not heard until 29 June 2009. The delay was due in part to HIA's filing of a second amended notice of appeal in final form on 4 December 2008 and its unsuccessful motion to strike out a notice of contention filed by Mr and Mrs Kostas: see HIA Insurance Services Pty Ltd T/as Home Owners Warranty v Kostas [2008] NSWCA 13 CTTT Act, s 5(1). 14 CTTT Act, s 88; New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 19 September 2001 at 16892. to the Supreme Court in language substantially reproduced in ss 66 and 67 of the The Tribunal's jurisdiction, powers and functions are defined as those "conferred on it by this or any other Act"16. The jurisdiction invoked by Mr and Mrs Kostas was that created by s 48K of the Home Building Act 1989 (NSW), sub-s (1) of which provides that the Tribunal can hear and determine any "building claim"17 brought before it in which the amount of the claim does not exceed $500,000. There was no dispute that the claim was a "building claim". The Tribunal may, subject to the CTTT Act, determine its own procedure18. It is not bound by the rules of evidence and may inquire into, and inform itself on, any matter in such manner as it thinks fit, subject to the rules of procedural fairness19. That freedom is enjoyed by many administrative tribunals. The term "rules of evidence" does not lay out with precision its metes and bounds20. Nor does it exclude the discretionary application of such rules. But the authority of the Tribunal to "inform itself on any matter in such manner as it thinks fit"21 indicates that it is able to act upon information whether or not it is embodied in evidence which would be admissible in a court of law. There are qualifications upon the Tribunal's procedural freedom. One, which is explicit, is the requirement to observe procedural fairness. The Tribunal's modus operandi must also serve its function, which, in this case, was to hear and determine a building claim. That function implies a rational process 15 Consumer Credit Act 1981 (NSW), s 208; Commercial Tribunal Act 1984 (NSW), s 20; Residential Tribunal Act 1998 (NSW), ss 61 and 62; cf Fair Trading Tribunal Act 1998 (NSW), s 61(1) (providing for "an appeal … on a question of law"). 16 CTTT Act, s 21(1); see also s 5(2). The Tribunal comprises divisions exercising jurisdiction under specific statutes: CTTT Act, s 10(1); Sched 1 cl 1. 17 A term defined in s 48A(1) of the Home Building Act. 18 CTTT Act, s 28(1). 19 CTTT Act, s 28(2). 20 Campbell, "Principles of Evidence and Administrative Tribunals", in Campbell and Waller (eds), Well and Truly Tried, (1982) 36 at 39-43; Rees, "Procedure and Evidence in 'Court Substitute' Tribunals", (2006) 28 Australian Bar Review 41 at 69-83; Giles, "Dispensing with the Rules of Evidence", (1990) 7 Australian Bar Review 233. 21 CTTT Act, s 28(2). of decision-making according to law22. A decision based on no information at all, or based on findings of fact which are not open on information before the Tribunal, is not compatible with a rational process23. The exercise of the Tribunal's freedom from the rules of evidence should be subject to the cautionary observation of Evatt J in R v War Pensions Entitlement Appeal Tribunal; Ex parte Bott that those rules "represent the attempt made, through many generations, to evolve a method of inquiry best calculated to prevent error and elicit truth"24. It is a method not to be set aside in favour of methods of inquiry which necessarily advantage one party and disadvantage another25. On the other hand, that caution is not a mandate for allowing the rules of evidence, excluded by statute, to "creep back through a domestic procedural rule"26. The Tribunal is required to act as expeditiously as is practicable27. A member may, in any proceedings, give procedural directions including directions that, in the opinion of the member, will enable costs to be reduced and will help to achieve a prompt hearing of the matters in issue between the parties in the proceedings28. It was not in dispute that this power would enable the Tribunal to hear and determine, as it did in this case, a particular issue where such determination is likely to expedite the proceedings. It is relevant to the approach to the construction of s 67 of the CTTT Act that the criteria for appointment to the Tribunal do not require, except in the case 22 The applicability of substantive and adjectival law (apart from the rules of evidence) appears from the mechanisms, in ss 66 and 67, for referral and appeal in relation to decisions on questions with respect to matters of law. 23 See, eg, Esanda Finance Corporation Ltd v Murphy (1989) ASC ¶55-703 at 58,356 per Hunt J, an appeal from the Commercial Tribunal of New South Wales concerning s 19(9) of the Commercial Tribunal Act, a precursor to s 28(2) of the 24 (1933) 50 CLR 228 at 256; [1933] HCA 30. 25 R v War Pensions Entitlement Appeal Tribunal; Ex parte Bott (1933) 50 CLR 228 at 256 per Evatt J. 26 Re Pochi and Minister for Immigration and Ethnic Affairs (1979) 2 ALD 33 at 41 27 CTTT Act, s 28(5)(a). 28 CTTT Act, s 29(1) and (4). of the Chairperson, that a member be a legal practitioner or be qualified for admission as such29. Moreover, parties are not entitled to be represented by another person unless such representation is approved by the Tribunal30. There is no entitlement to legal representation if the amount claimed or in dispute is less than $10,00031. There is no express provision entitling a person to legal representation if the claim is greater. The jurisdiction and powers of the Supreme Court on an appeal from the Tribunal Part 6 of the CTTT Act deals with appeals and rehearings. Section 65(1) precludes resort to prerogative, declaratory or injunctive relief in respect of matters heard or determined, or to be heard or determined, by the Tribunal. It does not preclude relief in relation to jurisdictional questions and the denial of procedural fairness to a party32. But the source of jurisdiction to grant such relief must be found elsewhere – for example, in s 69 of the Supreme Court Act 1970 (NSW). Where in any proceedings in the Tribunal a question arises with respect to a matter of law, s 66(2) of the CTTT Act authorises the Tribunal to decide the question or to refer it to the Supreme Court for decision. At the time Mr and Mrs Kostas commenced proceedings in the Supreme Court, an appeal to that Court from a decision of the Tribunal of a question with respect to a matter of law could be brought under s 67 of the CTTT Act. The relevant parts of the section are set out in the joint judgment33. While ss 66 and 67 are both concerned with questions with respect to matters of law, they serve different functions. A referral of a question to the 29 CTTT Act, s 8. By an amendment effected by the Consumer, Trader and Tenancy Tribunal Amendment Act 2008 (NSW), both the Chairperson and the Deputy Chairperson (Determinations) must now be Australian lawyers. 30 CTTT Act, s 36(1) and (2). In respect of matters arising under the Home Building Act, an application for permission to be represented could only be made if the proceedings involved a claim or dispute for an amount exceeding $25,000: Consumer, Trader and Tenancy Tribunal Regulation 2002 (NSW), cl 14(a). Similar provision is now made in cl 14(a) of the Consumer, Trader and Tenancy Tribunal Regulation 2009 (NSW). 31 CTTT Act, s 36(3). 32 CTTT Act, s 65(3). 33 See below at [75]. Supreme Court under s 66 involves the exercise by that Court of a limited interlocutory function. The Court has no general power under s 66 to dispose completely of proceedings before the Tribunal or to make such order as the Tribunal might, or might be required to, make in light of the Court's determination. The jurisdiction and powers of the Court on an appeal under s 67, however, are not so confined. It is significant that s 66 not only provides for referral to the Supreme Court of a question which arises with respect to a matter of law but also empowers the Tribunal to decide such a question for itself. Referral logically requires formulation of a question. A decision of a question with respect to a matter of law by the Tribunal itself may be a decision of a question which it has expressly formulated, or it may be a decision implicit in a finding of the Tribunal. The right of appeal conferred by s 67 is therefore not limited to an appeal against explicit decisions of questions formulated in the proceedings. On its face it extends to decisions which were necessary steps in the Tribunal's reasoning, whether or not made explicit by the Tribunal34. This construction of s 67 is compatible with the purpose, nature and composition of the Tribunal, which can be constituted by non-lawyer members. It is also compatible with a legislative scheme under which legal representation before the Tribunal will be the exception rather than the rule. The statutory objects of informality, expedition and inexpensiveness do not stop at the door of the Supreme Court. The extent of the term "a question with respect to a matter of law" is controlled by the words "with respect to". They are to be read and applied having regard to their legislative context35. Like the terms "in relation to" or "in connection with", they constitute a "prepositional phrase" of indefinite content36. 34 Kalokerinos v HIA Insurance Services Pty Ltd [2004] NSWCA 312 at [47] per Bryson JA, Santow JA agreeing; Scicluna v New South Wales Land and Housing Corporation (2008) 72 NSWLR 674 at 676 [3] per Basten JA, 685 [42] per Campbell JA; see also Custom Credit Corporation Ltd v Commercial Tribunal (NSW) (1993) 32 NSWLR 489 at 492 per Gleeson CJ; Ideal Waterproofing Pty Ltd v Buildcorp Australia Pty Ltd [2004] NSWSC 765 at [27]-[33] per Sperling J. 35 See, in relation to the like term "in respect of", State Government Insurance Office (Qld) v Crittenden (1966) 117 CLR 412 at 416 per Taylor J; [1966] HCA 56; Workers' Compensation Board (Q) v Technical Products Pty Ltd (1988) 165 CLR 642 at 653-655 per Deane, Dawson and Toohey JJ; [1988] HCA 49; Technical Products Pty Ltd v State Government Insurance Office (Q) (1989) 167 CLR 45 at 47 per Brennan, Deane and Gaudron JJ, 51 per Dawson J, 54-55 per Toohey J; [1989] HCA 24. 36 O'Grady v Northern Queensland Co Ltd (1990) 169 CLR 356 at 376 per McHugh J; [1990] HCA 16. The decisions they cover clearly include decisions of questions of law37 but not decisions of questions of fact. Nor does the appeal extend to all aspects of any decision involving a question of law38. The parties differed on whether the jurisdiction conferred by s 67 extends to decisions of questions of mixed fact and law. HIA contended that such decisions could only be the subject of appeal if the factual aspects of the question decided were not in dispute. That submission would effectively reduce the jurisdiction to one relating to questions of law. Decisions of the Supreme Court and the Court of Appeal which have taken that view of s 67 relied upon decisions construing its precursor provision, s 20(5) of the Commercial Tribunal Act 1984 (NSW). That provision took its place in a legislative scheme in which only a legally qualified Chairman or Deputy Chairman of the Commercial Tribunal could decide or refer questions with respect to matters of law39. A leading decision on s 67 in this connection is Kalokerinos v HIA Insurance Services Pty Ltd40. It expressly followed earlier decisions on s 20(5) of the Commercial Tribunal Act41. Later decisions followed it42. However, the language of s 67 is 37 Such questions define the grant of judicial review jurisdiction in s 44 of the Administrative Appeals Tribunal Act 1975 (Cth). 38 HIA Insurance Services Pty Ltd v Kostas [2009] NSWCA 292 at [109]-[110] per Basten JA; cf s 51(6) of the Income Tax Assessment Act 1922 (Cth) and s 196(2) of the Income Tax Assessment Act 1936 (Cth) as considered in Ruhamah Property Co Ltd v Federal Commissioner of Taxation (1928) 41 CLR 148 at 151 per Knox CJ, Gavan Duffy, Powers and Starke JJ, 155 per Isaacs J; [1928] HCA 22 and XCO Pty Ltd v Federal Commissioner of Taxation (1971) 124 CLR 343 at 348 per Gibbs J; [1971] HCA 37, respectively. 39 Commercial Tribunal Act, ss 5(1) and 20(3). See Esanda Finance Corporation Ltd v Murphy (1989) ASC ¶55-703 at 58,349 per Hunt J; Canham v Australian Guarantee Corporation Ltd (1990) 20 ALD 361 at 368 per Carruthers J; Sullivan v Waltons Credit Ltd (1990) ASC ¶56-023 at 59,233 per Carruthers J; Custom Credit Corporation Ltd (in liq) v Commercial Tribunal of New South Wales (2000) ASC ¶155-041 at 200,364-200,365 [83]-[90] per Greg James J. See also the discussion by Gleeson CJ in Custom Credit Corporation Ltd v Commercial Tribunal (NSW) (1993) 32 NSWLR 489 at 492-493. 40 [2004] NSWCA 312. 41 [2004] NSWCA 312 at [43]-[47]. 42 Grygiel v Baine [2005] NSWCA 218 at [26] per Basten JA, Mason P agreeing; Bahadori v Permanent Mortgages Pty Ltd (2008) 72 NSWLR 44 at 49 [18]-[20] per Tobias JA, Campbell JA agreeing; Douglas v New South Wales Land and Housing Corporation [2008] NSWCA 315 at [16]-[17] per Tobias JA, Bell JA and (Footnote continues on next page) not as confined as that line of authority would suggest. The words "question with respect to a matter of law" are wide enough to encompass a question of mixed law and fact. Questions of fact and law are often closely intertwined43. Section 75A of the Supreme Court Act It was submitted for Mr and Mrs Kostas that s 75A of the Supreme Court Act "broadens the nature of the appeal" under s 67. That submission, which involved issues of jurisdiction and power, requires consideration of the operation of s 75A. Section 75A applies to an appeal to the Supreme Court and an appeal in proceedings in that Court44. It was enacted in 1972 and replaced s 109 of the Supreme Court Act45, which applied to appeals to the Court of Appeal from the Supreme Court in a Division. It applies to statutory appeals from administrative bodies46. The qualification that s 75A "has effect subject to any Act"47 directs attention to the particular appeal jurisdiction in aid of which it is invoked and the limits of that jurisdiction, and of particular powers, accompanying its grant. An appeal is a creature of statute and may take various forms. Therefore, "it is always important, where a process called 'appeal' is invoked, to identify the character of the appeal and the duties and powers of the court or tribunal conducting it"48. On the other hand, the qualification that s 75A takes effect subject to any Act must be read in light of its character as a source of ancillary Gyles AJA agreeing. See also Chapman v Taylor (2005) Aust Contract Reports ¶90-205 at 88,280 [33] per Hodgson JA, Beazley and Tobias JJA agreeing. 43 Maurici v Chief Commissioner of State Revenue (2003) 212 CLR 111 at 116 [8]; [2003] HCA 8. 44 Supreme Court Act, s 75A(1). 45 Supreme Court (Amendment) Act 1972 (NSW), ss 7(d) and 9(b). The enactment of s 75A was recommended by the Law Reform Commission of New South Wales in Second Report of the Law Reform Commission on Supreme Court Procedure, Report No 14, (1971) at 42 [166]. 46 As appears from the term "court, body or other person" in s 75A(6) and from other sections of the Supreme Court Act contemplating appeals from such bodies: ss 46A(1)(d), 48 and 49. 47 Supreme Court Act, s 75A(4). 48 Walsh v Law Society (NSW) (1999) 198 CLR 73 at 90 [50] per McHugh, Kirby and Callinan JJ; [1999] HCA 33; see also Turnbull v New South Wales Medical Board [1976] 2 NSWLR 281 at 297-298 per Glass JA. jurisdiction and remedial power. The purpose of s 75A would be defeated if the application of the section were displaced too readily by reference to limits on the primary grant of appellate jurisdiction and the powers incidental to that grant. There is, however, one important sub-section of s 75A which would not sit easily with the limited nature of the appeal right conferred by s 67. That sub-section is s 75A(5), which provides: "Where the decision or other matter under appeal has been given after a hearing, the appeal shall be by way of rehearing." An appeal by way of rehearing requires that the appellant demonstrate "that, having regard to all the evidence now before the appellate court, the order that is the subject of the appeal is the result of some legal, factual or discretionary error"49. The capacity, in such an appeal, to review factual and discretionary error seems at odds with the nature of the jurisdiction conferred by s 67. It is not necessary finally to decide the question here because here the fact finding undertaken by the primary judge was supportable as an exercise of the powers conferred by s 75A(6) and other sub-sections of s 75A. By s 75A(6), the Supreme Court has the powers and duties of the court, body or other person from whom the appeal is brought, including powers and duties concerning the drawing of inferences and the making of findings of fact50. The Court may also make any finding or assessment, give any judgment, make any order or give any direction which ought to have been given or made or which the nature of the case requires51. It may be debatable whether some of the "powers" conferred by s 75A are grants of jurisdiction or powers in aid of jurisdiction52. The grant of power under s 75A(6), however characterised, is ancillary to the primary grant, which, in this case, was conferred by s 67 of the CTTT Act. Its exercise will necessarily be 49 Allesch v Maunz (2000) 203 CLR 172 at 180 [23] per Gaudron, McHugh, Gummow and Hayne JJ; [2000] HCA 40; see also CDJ v VAJ (1998) 197 CLR 172 at 201-202 [111] per McHugh, Gummow and Callinan JJ; [1998] HCA 67. 50 The predecessor to s 75A(6), s 109(3)(b), conferred similar powers by reference to those of the "court, judge, justice or person whose decision is under appeal". 51 Supreme Court Act, s 75A(10). 52 See Osland v Secretary to the Department of Justice (2010) 84 ALJR 528 at 535 [19] per French CJ, Gummow and Bell JJ; 267 ALR 231 at 238-239; [2010] HCA 24 and authorities cited therein; and see the analogous provision of s 44 of the Administrative Appeals Tribunal Act, defined as a grant of jurisdiction in restrained by the need to have regard to the limited nature of the appeal right conferred by s 67. By s 67(3)(a) of the CTTT Act, the Supreme Court, where an appeal is successful, may make such orders as the Tribunal should have made. That power is properly exercised where the Court's decision of a question of law leaves only one possible outcome, having regard to undisputed facts or facts found by the Tribunal53. Invocation of the ancillary jurisdiction and/or power conferred by s 75A(6) of the Supreme Court Act enables the Court, inter alia, to draw inferences from facts found by the Tribunal or to find facts on materials before the Tribunal which were not in dispute. An occasion for the use of that power would arise, as in this case, where limited fact finding would avoid the need for a remitter to the Tribunal and the imposition upon the parties of additional expense and delay. In Thaina Town (On Goulburn) Pty Ltd v City of Sydney Council54, Spigelman CJ, with whom the other members of that five-member Court agreed, said of s 75A55: "Such a jurisdiction conferred on a court which has 'all jurisdiction which may be necessary for the administration of justice in New South Wales' (s 23 of the Supreme Court Act) should not be narrowly construed. Nor can the words 'subject to any Act' be found to be satisfied save by clear statutory provision to that effect." His Honour also said56: "This Court must be concerned that the course of administration of justice in this State does not impose unnecessary cost burdens on parties by adopting a narrow interpretation of statutory powers conferred upon the Court to ensure the just and efficient administration of justice. Where no new findings of primary fact are required to be made, this Court should exercise a power conferred upon it in wide terms so as to ensure that the cost of legal disputation is minimised and thereby apply the guiding principle in s 56 of the Civil Procedure Act 2005 to the exercise of powers conferred by an Act other than that Act or by Rules of Court, so as to 53 See Baird v Magripilis (1925) 37 CLR 321 at 334 per Starke J; [1925] HCA 49. 54 (2007) 71 NSWLR 230. 55 (2007) 71 NSWLR 230 at 251 [97]. 56 (2007) 71 NSWLR 230 at 252 [103]. facilitate the just, quick and cheap resolution of the issues in dispute in civil proceedings." The conclusion that s 75A would not convert an appeal under s 67 into an appeal by way of rehearing would not involve a rejection of the observations of Spigelman CJ. They were put to one side by the Court of Appeal in subsequent decisions on the basis that they were not part of the ratio in Thaina Town57. Basten JA, in the Court of Appeal in the present case, held that, when an error of law had been identified in an appeal under s 67 and the Court could make orders which ought to have been made by the Tribunal, the Court should not "engage in a fact-finding exercise of its own, rather than making such order as it thinks appropriate, on the basis of facts agreed or fully found"58. That approach, with respect, took inadequate account of the remedial scope of s 75A, the objectives of the CTTT Act and the capacity of the Court of Appeal to inform the exercise of its discretionary jurisdiction and powers under s 75A with appropriate restraint. The observations made by Spigelman CJ in Thaina Town, so far as they went, were correct. Whether the jurisdiction of the Supreme Court was properly invoked An appellant invoking s 67 should identify the decisions of the Tribunal of questions with respect to matters of law which are the subject of the appeal59. A decision of a question with respect to a matter of law is not merely a condition of the jurisdiction conferred by s 67, it is the subject matter of that jurisdiction60. The requisite identification did not happen in this case. Nevertheless, the grounds of appeal to the Supreme Court asserted errors of law and of mixed law and fact on the part of the Tribunal constituting, or reflective of, decisions 57 B & L Linings Pty Ltd v Chief Commissioner of State Revenue (2008) 74 NSWLR 481 at 503 [75] per Allsop P, Giles and Basten JJA agreeing; GPT RE Ltd v Belmorgan Property Development Pty Ltd (2008) 72 NSWLR 647 at 670-671 [98]-[99] per Basten JA, Bell JA and Young CJ in Eq agreeing. 58 HIA Insurance Services Pty Ltd v Kostas [2009] NSWCA 292 at [120]. 59 McNamara v Consumer Trader and Tenancy Tribunal (2005) 221 CLR 646 at 653-654 [18], 654 [20] per McHugh, Gummow and Heydon JJ; [2005] HCA 55; Kalokerinos v HIA Insurance Services Pty Ltd [2004] NSWCA 312 at [58] per Bryson JA; Grygiel v Baine [2005] NSWCA 218 at [29] per Basten JA, Mason P agreeing; Bahadori v Permanent Mortgages Pty Ltd (2008) 72 NSWLR 44 at 47 [2] per Giles JA, 53 [33] per Tobias JA. 60 See the like observation made by Gummow J with respect to s 44 of the Administrative Appeals Tribunal Act in TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation (1988) 82 ALR 175 at 178. amenable to appeal under s 67. They raised a number of questions including that which is dispositive of this appeal, namely, whether there was any evidence before the Tribunal upon which it could make particular findings. That is a question of law61. Mr and Mrs Kostas submitted, in the first place, that the particular question for decision by the Tribunal, namely, whether they had validly terminated the contract, was a question with respect to a matter of law within the meaning of s 67(1) of the CTTT Act and that the Supreme Court had jurisdiction to determine whether the Tribunal erred in answering that question. In the alternative, they submitted that there were "sub-questions" contained within the larger question of the validity of the termination of the contract which "separately and cumulatively grounded the Court's jurisdiction in the appeal". It may be accepted that the "question with respect to a matter of law", which is the subject of a decision under appeal pursuant to s 67, may be defined with varying degrees of generality. It may be defined as a single question or multiple questions which can be regarded as subsumed in one decision or separately decided. In this case, as appears below, the decision that Mr and Mrs Kostas had not validly terminated the contract turned upon errors of law, including a finding of fact as to the service by SCC of claims for extensions of time which was not grounded in any evidence, material or information properly before the Tribunal. The material before the Tribunal On 10 November 2004, counsel for Mr and Mrs Kostas told the Tribunal that the evidentiary issues necessary for the determination of the preliminary point had been covered in the earlier hearing. Counsel foreshadowed a short re- examination of Mr Kostas and the tender of "some parts of the evidence" on the question of repudiation. The matter could then, it was said, proceed without cross-examination of the witnesses whose evidence Mr and Mrs Kostas had indicated they would rely upon. Counsel said: "We will indicate what those pieces of evidence are." There would be no need to trouble the Tribunal "with the mass of evidence which has already been served". Counsel for HIA relied upon a tender bundle of documents, including documents which had been put to Mr Kostas in cross-examination, and agreed to provide the Tribunal with a folder of the relevant material. Counsel did not indicate any intention to rely upon the affidavits of SCC's principal, Mr Turrisi, which had been filed in the proceedings but not read or tendered. Counsel for Mr and Mrs Kostas agreed to deliver with their submissions copies of the material upon which they relied. A list of the 61 Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 355 per Mason CJ (with whom Brennan J agreed), 368 per Deane J, 387 per Toohey and Gaudron JJ; [1990] HCA 33. See also Brown v Repatriation Commission (1985) 7 FCR 302 at 304. relevant documents had already been provided by letter to HIA's counsel. Mr Kostas had been cross-examined. It was agreed during the discussions on that his 10 November cross-examination would speak "for both of them". that he spoke for himself and Mrs Kostas and On 8 December 2004, Mr and Mrs Kostas filed in the Tribunal copies of the evidence already before the Tribunal upon which they relied in support of their submissions on the termination issue62. This comprised affidavits sworn by Mr and Mrs Kostas, other witness affidavits and expert reports prepared by Paul Rappoport, an architect, and George Zakos, a builder and arbitrator, which related, inter alia, to the state of completion of the works as at 12 June 2000 and defects in the works. It was one of the complaints made by Mr and Mrs Kostas in their appeal to the Supreme Court that, absent any tender of Mr Turrisi's affidavits and absent any notice that HIA wished to rely upon them, the Tribunal nevertheless appeared to have based its findings in relation to the termination issue in part on material in Mr Turrisi's affidavits. The Tribunal did not refer to the affidavits in its reasons at all. The building contract The named parties to the building contract were Mr Kostas and SCC, although, as noted earlier63, the proceedings seem to have been conducted as though Mrs Kostas was a party. The terms were contained, for the most part, in "[g]eneral conditions of contract" which formed part of a standard-form home building contract executed by the parties. The contract works were to commence within 28 working days of the date of the contract, which was 5 August 1999, and were to be completed within 30 calendar weeks from the date of commencement (cl 5). SCC could seek extensions of time when the work was delayed for one or more specified causes (cl 6). An extension of time was to be claimed by notice in writing setting out the cause and estimated length of the delay. The notice was to be given within 10 working days from the causative event or from the date of agreement to a contract variation giving rise to the delay. A procedure for effecting contract variations was set out (cl 12). 62 As appears from the affidavit of their solicitor which was filed in the appeal from the Tribunal to the Supreme Court. 63 See above at n 8. Clause 24 specified defaults on the part of SCC for which the contract could be terminated. They included suspension of the work before completion without reasonable cause, failure to proceed diligently with the work and failure to remedy defective work or remove faulty or unsuitable materials which substantially affected the work. Mr and Mrs Kostas could notify SCC in writing of a remediable default and indicate that, unless the default were remedied within 10 working days or such longer time as was specified, Mr and Mrs Kostas would end the contract. Clause 24 also provided for termination of the contract by written notice where SCC had not complied with a request by Mr and Mrs Kostas within the time allowed or where the default could not be remedied. Clause 27 set out the ways in which a written notice "must be given" under the contract. They were: handing it to the other party; leaving it with a person apparently over 16 at the other party's business or residential address; posting it by certified mail to the last known address of the other party; or sending it by facsimile transmission to the last known facsimile number of the other party. A notice not handed to the other party was to be taken to have been received three working days after being posted or the following day if left with a person at the other party's address or transmitted by facsimile. The Tribunal's decision In answer to Mr and Mrs Kostas' submission that they had terminated the contract, HIA contended that on 31 March 2000 and 23 May 2000, SCC had sent notices to Mr and Mrs Kostas claiming extensions of time pursuant to cl 6 of the contract. It submitted that the effect of the notices was that the date for practical completion was deemed to be extended to the end of September 2000. Mr and Mrs Kostas' evidence was that they never received the claims. They also submitted that there was no evidence that either of the claims had been sent. They submitted that HIA could not rely upon Mr Turrisi's affidavits, which it had not tendered. In an affidavit sworn on 15 August 2003, Mr Turrisi said that the claim of 31 March 2000 had been sent. He did not say how. He also said he had "sent a letter" on 23 May 2000 claiming an extension of time but did not say whether it was by certified mail. In his affidavit of 3 October 2003, he said Mr and Mrs Kostas would not agree to the extensions of time he claimed on 31 March 2000 and 23 May 2000. He did not elaborate by reference to the time, place or mode of those rejections. The Tribunal made findings adverse to the credibility of Mr and Mrs Kostas. It rejected Mr Kostas' evidence that he had prepared his list of defects without the aid of a building consultant. On that basis – and, it appears, on that basis alone – the Tribunal reached the sweeping conclusion that it was "not prepared to accept the Owners as reliable witnesses unless their evidence on the point is corroborated by another witness or other, reliable, material"64. The Tribunal said that it was satisfied on the evidence that SCC had sent the extension of time claims to Mr and Mrs Kostas. Reflecting its general finding adverse to the credibility of Mr and Mrs Kostas, it said that it was "not satisfied that they did not receive [the claims]"65. It did not specify the evidence upon which it relied for its positive finding that the claims were received. There were extension of time claims for 31 March 2000 and 23 May 2000 in the tender bundle but no evidence as to their despatch or receipt. They were not countersigned by Mr or Mrs Kostas. An earlier claim for extension of time dated 24 January 2000, which was not in dispute, bore the signature of one of them. Without any reference to cl 27 of the contract, the Tribunal nevertheless concluded66: "that the notices were validly served and that the Builder's time under the varied contract to complete was extended … It is not a matter … of relying upon the deemed service portion of Clause 6 of the contract. It is a finding of service, despite the evidence of the Owners. There was no notice of dispute, as required by the contract." The conclusion as to service, for which there was no evidence, was critical to the outcome of the case. Based on that conclusion the Tribunal found that, at the time of the notice of default sent to SCC on 4 May 2000, the extended contract had four months to run. It said67: "The position therefore is that as at the date of the first notice, the contract still had 4 months or so to run, and major progress with the works was dependent upon action by the Owners." The inference to be drawn, according to the Tribunal, was that "after a minor delay, the Builder intended to proceed with its essential promises"68. The Tribunal held that the notice of 12 May 2000 was not valid because it referred to 64 [2005] NSWCTTT 345 at [10]. 65 [2005] NSWCTTT 345 at [11]. 66 [2005] NSWCTTT 345 at [11]. 67 [2005] NSWCTTT 345 at [17]. 68 [2005] NSWCTTT 345 at [17]. "defective works" without specifying what they were69. A further notice of 16 May 2000 also could not be relied upon70. The termination letter of 29 June 2000 was found not to be effective because of the want of a "valid preliminary notice to rectify default"71. It was held to constitute a repudiation of the contract by Mr and Mrs Kostas. The Tribunal also held that SCC had not, by its conduct, repudiated the contract. It referred to a submission on behalf of Mr and Mrs Kostas that there was no evidence from SCC to support a conclusion that Mr and Mrs Kostas were responsible for delays in the completion of the contract72. This was the only reference in the Tribunal's reasons to the submissions on behalf of Mr and Mrs Kostas that there was no evidence from SCC. The grounds of appeal from the Tribunal to the Supreme Court The summons by which Mr and Mrs Kostas instituted their appeal did not identify in terms a decision of the Tribunal of a question with respect to a matter of law which would support the invocation of the jurisdiction conferred on the Supreme Court by s 67 of the CTTT Act. However, the grounds of appeal set out in a schedule to the summons did assert errors of law on the part of the Tribunal and, for the reasons already given, raised questions with respect to matters of law allegedly decided by the Tribunal73. The grounds raised complaints about reliance by the Tribunal on material not in evidence (grounds (a) and (b)), inconsistency between the Tribunal's orders and earlier orders made on 19 June 2002 (ground (c)), factual findings made without evidence (ground (d)), misconstruction of the contract (grounds (e) and (h)), findings contrary to "incontrovertible evidence of the plaintiffs" (grounds (f), (i), (j), (l) and (p)), erroneous shifting of the onus of proof (ground (g)), misinterpretation of the Home Building Act (ground (k)), erroneously based credibility findings (grounds (m), (n) and (o)) and inadequate reasons (ground (q)). 69 [2005] NSWCTTT 345 at [18]. 70 [2005] NSWCTTT 345 at [19]. 71 [2005] NSWCTTT 345 at [25]. 72 [2005] NSWCTTT 345 at [28]. 73 The grounds were also relied upon, without discrimination, to support the claim for prerogative relief under s 69 of the Supreme Court Act. The primary judge's reasoning The primary judge held that errors of law infected the findings of the Tribunal and that the appeal should be allowed. He referred to conclusions unsupported by evidence, failures to act upon uncontested and uncontradicted expert evidence, and errors in the construction of the contract74. The errors included a failure to refer to cl 27, the erroneous finding, absent any evidence, that SCC had served written claims for extensions of time in accordance with any of the procedures prescribed in that clause and the finding that the notices of default of 4 and 12 May 2000 were ineffective in law and contrary to the requirements of the contract. His Honour held that the notice of 4 May 2000 made clear that the 42 items it listed referred to uncompleted work and that Mr and Mrs Kostas also relied upon previous suspension of works, without reasonable cause, by SCC and its failure to proceed diligently75. The letter of 12 May 2000 reiterated those complaints76. There was uncontested and uncontradicted evidence that SCC had suspended works for a period in May 2000 and made little or no progress until termination of the contract on 29 June 200077. His Honour found it unnecessary to determine a complaint of want of procedural fairness based on the Tribunal's alleged reliance on the The primary judge held that the correction of the Tribunal's erroneous decisions required that he make findings. These led him to conclude that on 29 June 2000 Mr and Mrs Kostas were entitled to terminate the contract in accordance with cl 24. The failure of SCC to reply, within the requisite time, stating that it would comply with the contract, was confirmation of its unwillingness to perform its obligations. The termination of the contract was held to be lawful79. The primary judge decided a question, namely, the lawfulness of the termination of the contract, which was a question with respect to a matter of law. It is not necessary to determine whether the multiplicity of "decisions" identified by his Honour as decisions of the Tribunal informed by errors of law should be 74 [2007] NSWSC 315 at [165]. 75 [2007] NSWSC 315 at [110]. 76 [2007] NSWSC 315 at [115]. 77 [2007] NSWSC 315 at [102]. 78 [2007] NSWSC 315 at [166]. 79 [2007] NSWSC 315 at [171]. treated as elements of the one overarching decision concerning the lawfulness of the termination of the contract or whether they each stood as distinct decisions for the purposes of s 67. Nor is it necessary to decide whether any of the "decisions" related to questions of mixed law and fact. On any view, his Honour exercised the jurisdiction and powers conferred on him by s 67 and the ancillary jurisdiction and powers conferred on him by s 75A(6) of the Supreme Court Act. The reasoning and orders of the Court of Appeal The principal judgment in the Court of Appeal was delivered by Basten JA. His Honour referred to the errors found by the primary judge in the Tribunal's reasons. He held that those matters had not been identified by the Tribunal as questions for decision with respect to matters of law. An appeal under s 67 could encompass decisions which were impliedly made, or necessarily formed part of the decision-making process80. But s 67 would prevent a point of law being taken for the first time on appeal81. His Honour held that the primary judge's attempt to identify questions of law decided by the Tribunal from which an appeal could lie had failed82. Spigelman CJ agreed generally with Basten JA. He held the words "with respect to" in s 67 to be words of limitation intended to make it clear that no appeal would lie with respect to a matter of fact83. The subject matter of the appeal was the "matter of law" and not other matters connected to it84. The primacy intended to be given to the Tribunal as the finder of fact and the maker of any evaluative judgment required the jurisdiction provision in s 67(1) and the provision conferring power in s 67(3) to be understood as a single, coherent and congruent scheme85. Allsop P also generally agreed with Basten JA. He cautioned that the extent to which a decision with respect to a matter of law could be implicit in the reasoning of the Tribunal was not amenable to convenient definition86. The 80 [2009] NSWCA 292 at [129]. 81 [2009] NSWCA 292 at [129], citing Handley JA in Smith v Collings Homes Pty Ltd [2004] NSWCA 75 at [61]. 82 [2009] NSWCA 292 at [160]. 83 [2009] NSWCA 292 at [16]. 84 [2009] NSWCA 292 at [6]-[7]. 85 [2009] NSWCA 292 at [20]. 86 [2009] NSWCA 292 at [26]. question whether a "no evidence" ground would fall within the expression "a decision on a question with respect to a question of law" might depend on the circumstances87. The orders made by the Court of Appeal were: "1. Allow the appeal and set aside the orders and declarations made in the Common Law Division on 30 October 2007. In lieu thereof, dismiss the summons filed by the plaintiffs on 22 July 2005; order the plaintiffs to pay the costs of the first defendant in the Common Law Division. Order the first and second respondents to pay the appellant's costs in this Court. Grant the respondents an indemnity certificate under the Suitors' Fund Act 1951 (NSW) in respect of the appeal." For reasons already given, the approach taken by the Court of Appeal reflected an unduly narrow view of the jurisdiction and powers conferred on the Supreme Court by s 67 of the CTTT Act and s 75A of the Supreme Court Act. Conclusions and disposition HIA's submissions as to the scope of the Supreme Court's jurisdiction and powers under s 67 involved the following propositions: On an appeal under s 67(1) it is necessary to identify a decision of the Tribunal of a question with respect to a matter of law that was before the Tribunal. A "decision" in this context refers to the adjudication of a dispute, difference or controversy between the parties before the Tribunal. The matter of law may only include mixed questions of law and fact where the factual issues are resolved, that is, the facts found by the Tribunal are not in dispute. The broad question for which Mr and Mrs Kostas contended, namely, whether they had validly terminated the contract, could not, at that level of generality, yield a decision of a question within the meaning of s 67(1). 87 [2009] NSWCA 292 at [27]. Nor did the questions identified by the primary judge identify such a decision. The powers of the Supreme Court on an appeal under s 67 were limited to correcting legal error and remitting the matter back to the Tribunal (if necessary) or applying the law, properly understood, to the facts as found by the Tribunal. The Tribunal had made no decision of the question whether cl 27 was relevant to the dispute before the Tribunal. There was no consideration of the question in the Tribunal's reasoning. Therefore the question did not arise for appellate review. HIA made submissions about the state of the evidence before the Tribunal which included the following: It would have been open to the Tribunal to conclude, if it had not accepted the SCC evidence concerning the extension of time, that Mr and Mrs Kostas nonetheless did not have a basis for termination given their own acts and omissions. The finding that the contract had been extended was not critical to the decision that SCC had not repudiated it given that Mr and Mrs Kostas' conduct in issuing the notice of termination was itself a repudiation of the contract. Other acts of Mr and Mrs Kostas were found to have resulted in a disentitlement to terminate the contract. There was evidence of the service of the extension of time notices. The notices themselves were in evidence. HIA also argued that it was open to Basten JA to conclude that Mr Turrisi's affidavits were available to the Tribunal given that the written submissions of the parties referred to the Turrisi affidavits and that the submissions were read in the proceedings. For the reasons already given, that submission cannot be accepted. Mr and Mrs Kostas submitted that: The jurisdiction conferred by s 67 extended to decisions on questions of mixed law and fact. Once error of law was shown in an appeal under s 67, the Supreme Court, under s 67(3)(a), could determine any other question which in its opinion would enable it to make orders that should have been made in relation to the proceedings. The decision under appeal did not have to be a decision of a question expressly disputed by the parties before the Tribunal. A decision of the Tribunal for which there was no evidence could be characterised as a decision of a question with respect to a matter of law. For the reasons already given, propositions one, three and four should be accepted. Mr and Mrs Kostas submitted that it was open to the primary judge, once his jurisdiction was established, to find that the time for completion by SCC had not been extended to September 2000, that SCC's conduct justified the giving of the default notices under cl 24 on the grounds of suspension of the works without reasonable cause and lack of diligence, and that SCC's failure to correct its conduct justified termination on 29 June 2000. Those propositions should also be accepted. Having found error of law informing the Tribunal's decision that Mr and Mrs Kostas had not validly terminated the contract, the primary judge was entitled on the factual material, which was largely uncontradicted, to make the findings he did and in so doing to bring finality to the determination of the preliminary question which had been defined by the Tribunal in November 2004. The appeal should be allowed. I agree with the orders proposed in the joint judgment. HAYNE, HEYDON, CRENNAN AND KIEFEL JJ. In August 1999, the appellants contracted with a builder (Sydney Construction Co Pty Ltd – "the builder") for renovation of their residence in suburban Sydney88. The works were to take 30 weeks and were to cost $330,000. Before the works were finished, the contract was terminated. More than 10 years later, the appellants and the first respondent, the insurer of the builder's performance of its contract89, continue to litigate about whether it was the appellants or the builder who wrongfully terminated the contract. The appeal to this Court is from orders of the Court of Appeal of the Supreme Court of New South Wales (Spigelman CJ, Allsop P and Basten JA)90. The Court of Appeal had allowed the insurer's appeal against orders of a judge of the Common Law Division of the Supreme Court (Rothman J)91. By those orders, Rothman J set aside the "findings and orders" of the Consumer, Trader and Tenancy Tribunal ("the Tribunal") made on 25 May 2005 and declared that the appellants' termination (on 29 June 2000) of the contract with the builder "was lawful and effective". The central issue in this Court is about the nature of an appeal from the Tribunal to the Supreme Court. What kinds of issue can be raised in such an appeal? The Tribunal determined92 a question which the parties had agreed should be decided separately. No order was made by the Tribunal expressly directing that an issue be tried separately. Instead, directions were given for the filing and service of written submissions on a question, described in those directions as "the question of the termination of the contract", and in the Tribunal's reasons as being "whether or not the Owners [the present appellants] had validly terminated the contract with the Builder". In the course of the proceedings which led to the parties agreeing that an issue be decided separately, the issue had been described as the "repudiation issue". 88 Only the first appellant is named as a party to the contract. Throughout the proceedings both appellants have been treated as contracting parties. It is convenient to continue to act on that basis. 89 Under the Home Building Act 1989 (NSW). 90 HIA Insurance Services Pty Ltd v Kostas [2009] NSWCA 292. 91 Kostas v HIA Insurance Services Pty Ltd [2007] NSWSC 315. 92 Kostas v HIA Insurance Services Pty Ltd [2005] NSWCTTT 345. The Tribunal found that the appellants had repudiated the contract. A step critical to the Tribunal's finding of repudiation was that the time for performance of the contract had been extended to the end of September 2000. That, in turn, depended upon finding that the builder had "served in the manner set out in the contract"93 two claims for extension of time – one on 31 March 2000, the other on 23 May 2000 – and that the appellants had not disputed those claims in the manner required by the contract. The appellants contended that there was no material properly before the Tribunal which supported the finding that the disputed claims for extension of time had been served on the appellants. Was that a question which could be raised on appeal to the Supreme Court? That depends upon what is meant by the phrase "the Tribunal decides a question with respect to a matter of law" when used in s 67(1) of the Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) ("the Tribunal Act"). Section 67(1) of the Tribunal Act provided, at the relevant time, that a party in proceedings before the Tribunal who was dissatisfied with a decision of that kind (a decision of "a question with respect to a matter of law") may appeal to the Supreme Court against the decision. (The Tribunal Act has since been amended to provide for such appeals to lie to the District Court, rather than the Supreme Court.) As the case was argued in the Supreme Court, both at first instance and on appeal, attention was also directed to what orders the Supreme Court could make if the Tribunal did decide a question with respect to a matter of law and a party dissatisfied with the decision appealed to the Supreme Court against the decision. Those arguments proceeded on the footing that to make orders of the kind sought by the appellants, it was (or may be) necessary to examine issues of law or fact, or of mixed fact and law, other than the question said to have been erroneously decided. In this Court, however, the first respondent did not dispute that if, as the appellants argued, the Tribunal in this case decided a question with respect to a matter of law erroneously, the orders made by the primary judge should stand. It is therefore not necessary to explore, in these reasons, a number of the arguments that were considered in the Supreme Court. In particular, it will not be necessary to examine whether, on an appeal alleging an erroneous decision of a question with respect to a matter of law, the Supreme Court may determine questions of fact or law, or mixed fact and law, other than the particular question erroneously decided. 93 [2005] NSWCTTT 345 at [9]. The central issue in this Court should be resolved in favour of the appellants. Section 67(1) of the Tribunal Act permitted the appellants to appeal to the Supreme Court against the Tribunal's decision that there was material properly before the Tribunal which supported the conclusion that the disputed claims for extension of time had been served on the appellants. The conclusion that there was material of that kind, necessarily implicit in making the finding that the disputed claims had been served, was a decision with respect to a question of law. The Tribunal Act Although the immediate focus of the appeal to this Court falls upon the provisions of s 67 of the Tribunal Act (governing appeals), it is necessary to set those provisions in the context of other provisions of the Act that established the Tribunal and governed its procedures. The Tribunal has functions "conferred or imposed" on it94 by or under a number of Acts including the Home Building Act 1989 (NSW) ("the Home Building Act"). Section 48K(1) of the Home Building Act provided that the Tribunal has jurisdiction to hear and determine any "building claim" brought before it (in accordance with the relevant Part of that Act) in which the amount claimed does not exceed $500,000. A "building claim" was defined in s 48A(1) in a way that included the claims made by the appellants against the builder. The objects of the Tribunal Act include95 ensuring "that the Tribunal is accessible, its proceedings are efficient and effective and its decisions are fair". They also include enabling "proceedings to be determined in an informal, expeditious and inexpensive manner". The progress of this dispute both within the Tribunal, and since, has been anything but expeditious and inexpensive. Subject to the Act, the Tribunal may determine its own procedure96. It is "not bound by the rules of evidence" and "may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of procedural fairness"97. The Tribunal is "to act with as little formality as the circumstances of 94 Consumer, Trader and Tenancy Tribunal Act 2001 (NSW), s 5(2). the case permit"98. It is to act "according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms"99. It is "to act as expeditiously as is practicable"100 and must "ensure, as far as practicable, that all relevant material is disclosed to [it] so as to enable it to determine all of the relevant facts in issue"101. It "must ensure"102 that each party is "given a reasonable opportunity" to call or give evidence and present its case, and "to make submissions in relation to the issues in the proceedings". A party to proceedings has the carriage of his or her own case and is not entitled to be represented by any person except as the Act provides103. All of these provisions are consistent with the stated object of having the Tribunal determine proceedings informally, expeditiously and inexpensively. But the Tribunal's decisions are not necessarily final; they are subject to appeal. When does appeal lie? Part 6 of the Tribunal Act (ss 65-69) dealt with what the heading of the Part described as "Appeals and rehearings". Section 65 was a privative provision directed to preventing review by prerogative writ. It is not necessary to examine the application of that section. Section 66 provided for referral of questions of law to the Supreme Court, and s 67 for appeals against a decision of the Tribunal with respect to a matter of law. Section 67 of the Tribunal Act, so far as now relevant, provided at the relevant time: "Appeal against decision of Tribunal with respect to matter of law If, in respect of any proceedings, the Tribunal decides a question with respect to a matter of law, a party in the proceedings who is dissatisfied with the decision may, subject to this section, appeal to the Supreme Court against the decision. 100 s 28(5)(a). 101 s 28(5)(b). (2) An appeal is to be made in accordance with the rules of the Supreme Court. The rules of the Supreme Court may provide that an appeal (or such classes of appeal as may be specified in the rules) may be made only with the leave of the Court. (3) After deciding the question the subject of such an appeal, the Supreme Court may, unless it affirms the decision of the Tribunal on the question: (a) make such order in relation to the proceedings in which the question arose as, in its opinion, should have been made by the Tribunal, or remit its decision on the question to the Tribunal and order a rehearing of the proceedings by the Tribunal. (8) A reference in this section to a matter of law includes a reference to a matter relating to the jurisdiction of the Tribunal." It will be observed that s 67 referred to a question "with respect to a matter of law". Section 66(2) provided for the Tribunal to decide for itself, or to refer to the Supreme Court for decision, "a question [which] arises with respect to a matter of law". Section 67(1) provided for an appeal to the Supreme Court "[i]f, in respect of any proceedings, the Tribunal decides a question with respect to a matter of law". The parties advanced arguments about what followed from the use of similar language in provisions dealing in one case with reference for decision by the Supreme Court, and in the other with conferral of a right of appeal. But, as will later be explained, the determination of this case does not depend upon resolving whether any of those arguments are correct. Something more must be said at this point about the decisions at first instance in the Supreme Court and on appeal to the Court of Appeal. The appeal to the Supreme Court The Tribunal having decided that the appellants had repudiated the building contract, the appellants appealed to the Supreme Court claiming (among other relief) orders "setting aside the orders ... by which the Tribunal found ... that the [appellants] had repudiated" the contract, and orders under s 67(3)(a) making what they contended were the determinations that the Tribunal should have made. Numerous grounds of appeal were stated in terms that would have been apposite had there been a general appeal to the Supreme Court by rehearing. The question or questions of law alleged to have been wrongly decided by the Tribunal were not distinctly identified. Nonetheless, one of the several submissions made on the appellants' behalf was that there was no evidence that the builder had served the two critical claims for extension of time. (It will be recalled that the conclusion that those two claims for extension had been validly served was a necessary step in the Tribunal reaching its conclusion that the appellants had repudiated the contract.) The primary judge accepted104 the appellants' submission that there was no evidence before the Tribunal that the builder had served either of the two critical claims for extension of time and that, accordingly, the Tribunal had made an erroneous decision with respect to a question of law. The primary judge further concluded105 that the Tribunal had made, or must be taken to have made, several other wrong decisions with respect to questions of law. At least some of the further questions which the primary judge identified as wrongly decided were questions about the proper construction and application of the contract that arose if, as the primary judge held, the Tribunal was wrong to conclude that there had been valid extensions of time for the builder's performance of the contract. Whether there was any evidence before the Tribunal that the relevant claims for extension of time had been served was a matter of controversy in the Supreme Court. The Tribunal had concluded106 that the claims had been served but did not, in its reasons, identify the evidence relied on for that conclusion, and did not specify how or when the claims had been served. An affidavit sworn by the principal of the builder, deposing to service of the claims, had been filed in the Tribunal, but that affidavit was not part of the material which the parties put before the Tribunal for its consideration in deciding the separate issue of repudiation. The material which the parties put before the Tribunal for that purpose included documents in the form of claims for extension of time but included no material which showed whether, or how, those documents had been served. The appellants submitted to the primary judge that, without the affidavit of the builder's principal, there was no evidence of service and that, if the Tribunal acted on the affidavit, the appellants had been denied procedural fairness. The 104 [2007] NSWSC 315 at [95]-[99]. 105 [2007] NSWSC 315 at [144], [170]. 106 [2005] NSWCTTT 345 at [11]. primary judge held107 that the affidavit was not evidence before the Tribunal. It followed that there was no evidence of service of the notices in accordance with the contract108. The appeal to the Court of Appeal The principal reasons of the Court of Appeal were given by Basten JA. Subject to some qualifications, the other members of the Court (Spigelman CJ and Allsop P) agreed with Basten JA. The central conclusion reached109 by Basten JA was that the "preferable view is that while a 'no evidence' ground may support judicial review, it does not form a basis for a statutory appeal under s 67(1)". Allsop P accepted110 that a "finding of fact made in the absence of supporting evidence is an error of law", but concluded111 that "[s]uch a finding may or may not amount to or involve 'a decision on a question with respect to a matter of law'". In his Honour's view, whether a finding of fact, made without supporting evidence, amounts to a decision on a question with respect to a matter of law might depend112 "upon the context of that aspect of the Tribunal's reasoning and approach". But what aspects of the Tribunal's reasoning or approach bear upon whether a finding of fact, made without evidence, amounts to a decision of a question with respect to a matter of law was not further explored, whether generally, or by reference to the finding made by the Tribunal in this case, that claims for extension had been made and served on the appellants. Basten JA sought to identify a taxonomy of those appeals that are "restricted in some way to legal error". He identified113 three "broad categories" of appeal provisions, although he also said114 that "there are more variations than 107 [2007] NSWSC 315 at [87]. 108 [2007] NSWSC 315 at [98]. 109 [2009] NSWCA 292 at [137]. 110 [2009] NSWCA 292 at [27]. 111 [2009] NSWCA 292 at [27]. 112 [2009] NSWCA 292 at [27]. 113 [2009] NSWCA 292 at [83]. 114 [2009] NSWCA 292 at [83]. the categorisation would suggest". The first category (where the right of appeal is given from a decision that "involves a question of law") was identified115 as the broadest category and exemplified by the provisions considered in Ruhamah Property Co Ltd v Federal Commissioner of Taxation116. The second category was said117 to be exemplified by provisions permitting an appeal "on a question of law from a decision of" a tribunal. Reference was made to Brown v Repatriation Commission118. This second category of appeal was said119 to be one where the question of law is "the sole subject matter of the appeal, to which the ambit of the appeal is confined". The third, and narrowest, class was said120 to be "one restricted to 'a decision of a Tribunal on a question of law'". In such a case it was said121 that "it is not sufficient to identify some legal error attending the judgment or order of the Tribunal; rather it is necessary to identify a decision by the Tribunal on a question of law, that decision constituting the subject matter of the appeal". Basten JA rejected122 an argument advanced by the present appellants that, once error in a question of law was established, the Supreme Court was entitled to determine any other question of fact or law (or mixed fact and law) that was necessary to exercise its power under s 67(3)(a) of the Tribunal Act to "make such order in relation to the proceedings in which the question arose as, in its opinion, should have been made by the Tribunal". As noted earlier in these reasons, it is not necessary to consider the validity of this argument. Basten JA examined each of the questions which the primary judge had identified as a question with respect to a matter of law that had been wrongly 115 [2009] NSWCA 292 at [84]. 116 (1928) 41 CLR 148; [1928] HCA 22. 117 [2009] NSWCA 292 at [85]. 118 (1985) 7 FCR 302 at 304. 119 [2009] NSWCA 292 at [85]. 120 [2009] NSWCA 292 at [86]. 121 [2009] NSWCA 292 at [86]. 122 [2009] NSWCA 292 at [105], [110], [113]. decided by the Tribunal and concluded that none was a question of that kind. As to the "no evidence" ground, he said123: "There is something highly artificial in suggesting that the Tribunal would ask itself whether there was evidence 'capable of' supporting a particular factual conclusion, as opposed to whether the assertion should be accepted. The preferable view is that while a 'no evidence' ground may support judicial review, it does not form a basis for a statutory appeal under s 67(1)." The arguments in this Court The appellants and the first respondent each advanced submissions about what was said to be the preferable construction of the phrase "question with respect to a matter of law". The appellants submitted that the connecting expression "with respect to" is, and should be understood in this context as, a broad expression, which permitted appeal to the Supreme Court in a wide range of circumstances. The appellants further submitted124 that once "a question with respect to a matter of law" was identified, the Supreme Court could, on finding error in dealing with that question, "determine any other question of fact or law or mixed fact and law as would enable it to make appropriate orders" including orders of the kind contemplated by s 67(3)(a): "such order in relation to the proceedings ... as ... should have been made by the Tribunal". By contrast, the first respondent submitted that s 67 does not give the Supreme Court the capacity to find facts differently from the Tribunal or to find facts not found by the Tribunal. In effect, the first respondent submitted that the task of the Supreme Court, on an appeal under s 67 of the Tribunal Act, was to determine only "the question [or questions] with respect to a matter of law" that founded its jurisdiction (including, perhaps, applying the correct legal holding to the facts, as found by the Tribunal). That conclusion was said to be supported by, even to follow from, the fact that, on reference under s 66 of "a question ... with respect to a matter of law", the Supreme Court would answer that question and none other. On such a reference, the Court could make no decision or order with respect to any other question or issue in the proceedings in the Tribunal. 123 [2009] NSWCA 292 at [137]. 124 Referring to the Supreme Court Act 1970 (NSW), s 75A and Thaina Town (On Goulburn) Pty Ltd v City of Sydney Council (2007) 71 NSWLR 230 at 251-252 Because the first respondent accepted that, if there was the erroneous decision of a question with respect to a matter of law, the primary judge's orders should be restored, it is not necessary to decide the issues presented by these competing submissions about what follows from a finding that the Tribunal has erred in determining a question with respect to a matter of law. Further, there are considerable difficulties presented by expressing the operation of the relevant provisions in the fashion described. First, it is not useful to attempt to chart the metes and bounds of the task given to the Supreme Court by s 67 of the Tribunal Act, and to attempt to do so is dangerous. Secondly, to attempt such a task at the level of abstraction at which the submissions of the parties were cast, or in terms divorced from the circumstances of a particular case, would invite error. Likewise, when considering whether a question is a question with respect to a matter of law, it is not useful, with respect, to attempt a taxonomy of the kind proposed by Basten JA. First, as his Honour pointed out125, "there are more variations than the categorisation [which he proposed] would suggest". Secondly, the adoption of such a taxonomy would lead to error if the classes identified were treated as useful starting points for consideration of the effect of particular statutory provisions for appeal. The language of the statute must be the relevant starting point, not a taxonomy which seeks to reduce a wide variety of statutory provisions to a few discrete categories. It is sufficient, for present purposes, to determine that the ground usually described as a "no evidence ground" raises a question of law. And the first respondent accepted that a no evidence ground may form a basis for a statutory appeal under s 67(1). The first respondent further submitted, however, that whether "there was sufficient evidence before the Tribunal such that a 'no evidence' submission could not be made ... is a factual question rather than the identification of a decision of the Tribunal of a question with respect to a matter of law". The first respondent's further submission should be rejected. Whether there was no evidence to support a factual finding is a question of law, not a question of fact. The Tribunal's factual finding in this case, that the builder had served the two relevant claims for extension of time, necessarily depended upon its first accepting that there was evidence to support the finding. As Dixon CJ said in Gurnett v The Macquarie Stevedoring Co Pty Ltd [No 2]126: 125 [2009] NSWCA 292 at [83]. 126 (1956) 95 CLR 106 at 113; [1956] HCA 29. "in the legal dichotomy between questions of fact and questions of law we place under the latter head a question whether there is sufficient evidence to submit to a jury in support of a cause of action. That is because it is a question for the court to decide and not for a tribunal of fact." A tribunal that decides a question of fact when there is "no evidence" in support of the finding makes an error of law127. What amounts to material that could support a factual finding is ultimately a question for judicial decision. It is a question of law. And in this case, for the reasons given by the primary judge, there was no evidence before the Tribunal, when it decided the separate question identified by the parties, upon which the Tribunal could find that the disputed notices had been served. Conclusion and orders In this case, the Tribunal made a wrong decision with respect to a question of law. As already noted, the first respondent accepted that if that were so, it followed that the orders made by the primary judge should be restored. There should be orders that the appeal to this Court is allowed with costs. The orders of the Court of Appeal of the Supreme Court of New South Wales made on 16 September 2009 should be set aside and in their place there should be orders that the appeal to the Court of Appeal is dismissed with costs. 127 Lombardo v Federal Commissioner of Taxation (1979) 28 ALR 574 at 578 per Bowen CJ; TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation (1988) 82 ALR 175 at 187 per Gummow J.
HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Mallard v The Queen [2005] HCA 68 15 November 2005 ORDER 1. Appeal allowed. Set aside the orders of the Court of Criminal Appeal of the Supreme Court of Western Australia dated 3 December 2003 and, in place thereof, order that the conviction of the appellant be quashed, and that there be an order for retrial of the appellant. On appeal from the Supreme Court of Western Australia Representation: M J McCusker QC with J J Edelman for the appellant (instructed by Clayton Utz) B W Walker QC with B Fiannaca for the respondent (instructed by Director of Public Prosecutions (Western Australia)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Appellant convicted of murder – Appellant petitioned for mercy – Attorney-General referred petition to Court of Criminal Appeal – Whether non- disclosure of exculpatory evidence by prosecution denied appellant a fair trial or fair chance of acquittal – Scope of jurisdiction of Court of Criminal Appeal on Attorney-General's reference under s 140(1)(a) Sentencing Act 1995 (WA) – Duty to consider the "whole case" – Whether Court of Criminal Appeal erred in refusing to consider evidence adduced at trial – Whether jury verdict unreasonable or unsupportable – Whether jury verdict could not be supported having regard to the evidence – Whether a substantial miscarriage of justice occurred – Whether a retrial should be ordered. Appeal – New trial – Petition for mercy – Reference of whole case to Court of Criminal Appeal – Scope of proceedings in Full Court. Words and phrases – "fresh evidence", "new evidence", "whole case", "as if it were an appeal". Criminal Code (WA), ss 21, 689(1). Sentencing Act 1995 (WA), s 140(1)(a). GUMMOW, HAYNE, CALLINAN AND HEYDON JJ. The appellant was tried and convicted by the Supreme Court of Western Australia (Murray J with a jury) of the murder of Mrs Lawrence, the proprietor of a jewellery shop, at Perth on 23 May 1994. The trial lasted 10 days. The appellant unsuccessfully appealed to the Court of Criminal Appeal of Western Australia. After he had served eight years of his sentence of life imprisonment in strict security, he petitioned for clemency. The Attorney-General for Western Australia referred the petition to the Court of Criminal Appeal which dismissed the appeal. The appeal to this Court raises questions as to the way in which the Court of Criminal Appeal should proceed in determining a reference of such a petition and the evidence to which it may have regard in doing so. The legislation Part 19 of the Sentencing Act 1995 (WA) ("the Act") both preserves the royal prerogative of mercy and makes alternative provision for its effective exercise by the Court of Criminal Appeal. The relevant provisions are as follows: "Part 19 – Royal Prerogative of Mercy 137 Royal Prerogative of Mercy not affected This Act does not affect the Royal Prerogative of Mercy or limit any exercise of it. 138 Effect of pardon (1) A pardon granted in the exercise of the Royal Prerogative of Mercy has the effect of discharging the offender from the effects of the sentence imposed for the offence and of any other order made as a consequence of the offender's conviction. (2) A pardon does not quash or set aside the conviction for the offence. 139 Governor may remit order to pay money The Governor may remit the whole or part of any sum of money that an offender is, under this Act or any other written law, ordered to pay as a penalty, or by way of forfeiture or estreat, or compensation, or costs, in relation to the offence, whether to the Crown or not. Callinan 140 Petition may be referred to CCA (1) A petition for the exercise of the Royal Prerogative of Mercy in relation to an offender convicted on indictment, or to the sentence imposed on such an offender, may be referred by the Attorney General to the Court of Criminal Appeal either – for the whole case to be heard and determined as if it were an appeal by the offender against the conviction or against the sentence (as the case may be); or for an opinion on any specific matter relevant to determining the petition. The Court of Criminal Appeal must give effect to the referral. 141 Offender may be paroled In the exercise of the Royal Prerogative of Mercy in relation to an offender who is sentenced to imprisonment, the Governor may make a parole order in respect of the offender. (2) An offender may be paroled under subsection (1) whether or not he or she is or will be eligible for parole and despite section 96(3). The release date is that set by the Governor. The parole period is that set by the Governor; but it must be at least 6 months and not more than 5 years. Part 3 of the Sentence Administration Act 1995 applies in respect of the parole order and to the offender to whom the parole order applies." Part 19 was enacted in replacement of s 21 of the Criminal Code (WA) which read: "Royal prerogative of mercy not affected Nothing in this Code affects Her Majesty's royal prerogative of mercy, but the Attorney General on the consideration of any petition for the exercise of Her Majesty's mercy having reference to the conviction of a person on indictment or to the sentence passed on a person so convicted, may, if he thinks fit, at any time either – Callinan refer the whole case to the Court of Criminal Appeal, and the case shall then be heard and determined by the Court of Criminal Appeal as in the case of an appeal by a person convicted; or if he desires the assistance of the Court of Criminal Appeal on any point arising in the case with a view to the determination of the petition, refer that point to the Court of Criminal Appeal for their opinion thereon, and the Court shall consider the point so referred and furnish the Attorney General with their opinion thereon accordingly." Provision for the referral of petitions for clemency to the courts owes its modern origin to public adverse reaction to the excessive imposition of capital punishment in the nineteenth and earlier centuries. As the capital statutes were repealed so as to apply the death penalty to fewer offences, appeals for pardons to the Crown tended to be made in cases of asserted miscarriages of justice, despite the anomaly to which a successful petition might give rise, that a person who has in fact come to be considered to have been wrongly convicted or innocent, is pardoned, and not acquitted of the crime. The importance of this avenue of recourse to justice, effectively controlled by the Executive, declined, after the introduction of the Criminal Appeal Act 1907 (UK) to establish the Court of Criminal Appeal, although no attempt was made to abolish it. It proved fortunate that this was so because there was, initially at least, a judicial reluctance to allow appeals in criminal cases, occasioned in part no doubt by the sanctity accorded, and usually desirably so, to the verdict of a jury, and less desirably, to the legal conservatism of some of the judiciary of the day. The provision with which the Court is concerned in this case is similar in substance to provisions in other States1. The significance of this history for present purposes, is that the exercise for which s 140(1)(a) of the Act provides is effectively both a substitute for, and an alternative to, the invocation, and the exercise of the Crown prerogative, an exercise in practice necessarily undertaken by officials and members of the Executive, unconfined by any rules or laws of evidence, procedure, and appellate conventions and restrictions. That history, briefly stated, argues in favour of an 1 See Crimes Act 1900 (NSW), ss 474B and 474C; Crimes Act 1958 (Vic), s 584; Criminal Law Consolidation Act 1935 (SA), s 369; Criminal Code (Q), s 669A; Criminal Code (Tas), s 419. Callinan approach by a court on a reference of a petition by the Attorney-General to it, of a full review of all the admissible relevant evidence available in the case, whether new, fresh or already considered in earlier proceedings, however described, except to the extent if any, that the relevant Part of the Act may otherwise require. The Attorney-General for the State of Western Australia referred this petition to the Court of Criminal Appeal under s 140(1)(a) of the Act. Criminal appeals are the subject of s 689 of the Criminal Code, which provides as follows: "689 Determination of appeals in ordinary cases The Court of Criminal Appeal on any such appeal against conviction shall allow the appeal, if they think that the verdict of the jury should be set aside on the ground that it is unreasonable or cannot be supported having regard to the evidence, or that the judgment of the court before whom the appellant was convicted should be set aside on the ground of a wrong decision of any question of law or that on any ground there was a miscarriage of justice, and in any other case shall dismiss the appeal: Provided that the Court may, notwithstanding that they are of opinion that the point raised in the appeal might be decided in favour of the appellant, dismiss the appeal if they consider that no substantial miscarriage of justice has actually occurred. Subject to the appeal provisions of this chapter the Court of Criminal Appeal shall, if they allow an appeal against conviction, quash the conviction and either direct a judgment and verdict of acquittal to be entered or order a new trial. (3) On an appeal against sentence the Court of Criminal Appeal shall, if they think that a different sentence should have been passed, quash the sentence passed at the trial, and pass such other sentence warranted in law by the verdict or which may lawfully be passed for the offence of which the appellant or an accused person stands convicted (whether more or less severe) in substitution therefor as they think ought to have been passed and in any other case shall dismiss the appeal. (4) On an appeal against sentence the Court of Criminal Appeal may have regard to whether or not the appellant or a convicted person has failed wholly or partly to fulfil an undertaking to assist law Callinan enforcement authorities that caused the sentencing court to reduce the sentence that it would otherwise have passed." The proper approach Insight into the cautious way in which the Court of Criminal Appeal here (Parker, Wheeler and Roberts-Smith JJ) conceived its function under the Act and the Criminal Code can be gained from these passages in that Court's unanimous "It was accepted on both sides that on reference the court had a duty to consider the 'whole case'. The court is required to consider the case in its entirety, subject only to the limitation that it is bound to act upon legal principles appropriate to an appeal. However, there was at times a tendency for counsel for the petitioner to refer to this proposition as if it justified the hearing afresh of evidence at trial and evidence called on the appeal, without regard either to the verdict of the jury or to the previous decision of the Court of Criminal Appeal in this case. That was particularly noticeable in the petitioner's opening submissions, in which very detailed submissions were put as to discrepancies between the evidence of various witnesses as to the timing of certain events. Those matters were before the jury at the petitioner's trial, although of course they were not marshalled and emphasised in precisely the way in which the petitioner now seeks to marshal and emphasise them." Their Honours then reviewed the authorities with respect to the identification and reception of evidence as fresh evidence. They drew a distinction between "new evidence", that is, evidence available but not adduced at trial, and "fresh evidence", which appellate courts ordinarily will receive, on the basis that it did not then exist, or, if it did, could not then have been Their whole approach thereafter discovered with reasonable diligence. proceeded on the basis of the passages that we have quoted, that is, as if there were serious inhibitions upon that Court's jurisdiction to consider, not just the evidence that was adduced at the trial, but also its relevance to the further evidence that the appellant sought to introduce and rely upon in the reference. It seems to us that the approach was an erroneous one. Subject only to what we will say later about the words "as if it were an appeal" which appear in 2 Mallard v The Queen (2003) 28 WAR 1 at 5 [7]-[8]. Callinan s 140(1)(a) of the Act, the explicit reference to "the whole case" 3 conveys no hint of any inhibition upon the jurisdiction of the Court of Criminal Appeal on a reference. Indeed, to the contrary, the words "the whole case" embrace the whole of the evidence properly admissible, whether "new", "fresh" or previously adduced, in the case against, and the case for the appellant. That does not mean that the Court may not, if it think it useful, derive assistance from the way in which a previous appellate court has dealt with some, or all of the matters before it, but under no circumstances can it relieve it of its statutory duty to deal with the whole case. The history, as we have already mentioned, points in the same direction. The inhibitory purpose and effect of the words "as if it were an appeal" are merely to confine the Court to the making of orders, and the following of procedures apposite to an appeal, and further, and perhaps most relevantly, to require the Court to consider whether the overall strength of the prosecution case requires the Court to apply the proviso contained in s 689(1) of the Criminal Code. This construction of Pt 19 of the Act is consistent with the approach of Toohey and Gaudron JJ (Mason CJ and Brennan J agreeing) in Mickelberg v The Queen4: "The words of s 21(a) of the Code, so far as they require 'the whole case ... [to] be heard and determined', permit of only one meaning. It is the whole case which must be passed upon by the application of legal principles appropriate to criminal appeals. That being so, the power to exclude matters from consideration is properly to be seen as an aspect of the inherent power of a court to control its own proceedings. That power will authorize the exclusion of issues which are frivolous or vexatious5. However, subject to an issue being properly excluded as frivolous or vexatious, it is, in our view, the duty of a court to which there has been a reference of the whole case to pronounce upon the whole case as presented." 3 Sentencing Act 1995 (WA), s 140(1)(a). (1989) 167 CLR 259 at 312. Jackson v Sterling Industries Ltd (1987) 162 CLR 612; Tringali v Stewardson Stubbs & Collett Ltd (1966) 66 SR (NSW) 335; Metropolitan Bank v Pooley (1885) 10 App Cas 210. Callinan It is also consistent with the construction adopted by Lord Diplock (Lords Scarman, Roskill, Brandon of Oakbrook and Templeman agreeing) in R v Chard6 of like language of s 17(1)(a) of the Criminal Appeal Act 1968 (UK): "In my view, which I understand is shared by all your Lordships, the words of paragraph (a) of subsection (1) in their natural and ordinary meaning are free from any trace of ambiguity; the person whose case which resulted in his conviction is the subject matter of the reference is to be treated for all purposes as if he were a person upon whom there is conferred by section 1 of the Criminal Appeal Act 1968 a general right of appeal to the Court of Appeal on any ground which he wishes to rely (whether it be of law or fact or mixed law and fact), without need to obtain the prior leave of that court. Since it is the 'whole case' that is referred, this must include all questions of fact and law involved in it ..." (emphasis added) It follows that in proceeding as it did, the Court of Criminal Appeal erred in law. The question remains however, whether that error induced or caused a miscarriage of justice, the same question as would exercise the mind of the Executive were it to deal with a petition rather than refer it to the Court of Criminal Appeal for determination. The answer to that question may only be given after a consideration of the facts, not only as they emerged at the trial, but also as they emerged in the Court of Criminal Appeal, no matter what descriptive term the evidence adduced there might be given. It is elementary that some matters may assume an entirely different complexion in the light of other matters and facts either ignored or previously unknown. Facts Mrs Lawrence was alone in her shop when she was violently assaulted with a heavy instrument which has never been found. The assault occurred in the late afternoon. She was discovered, barely alive, but terminally injured, in a pool of her own blood, by her husband. The appellant had, on a previous occasion or occasions, been in the shop. He was a user of marijuana. Earlier on the day of the assault, he had been briefly in the custody of police officers. Following the death he was repeatedly interviewed by police officers, both while he was in hospital for the treatment of mental infirmity, and elsewhere. Only one of the [1984] AC 279 at 289-291. Callinan interviews was recorded. During the interviews he made some highly fanciful, indeed incredible assertions and claims, as well as apparently inculpatory, confessional statements. Some witnesses at the trial, with varying degrees of credibility, swore that they had seen the appellant in or about the shop at or about the time of the murder. It is sufficient for immediate purposes to say, that the whole of the evidence at the trial, including that of the appellant, despite conflicts in it, was sufficient to sustain a verdict of guilty. On the reference however, further evidence was adduced. It also became apparent that a deal of it had been in the possession of investigating police before, and during the trial, and had not then been disclosed to the appellant. (Whether any of it was in the possession of the Director of Public Prosecutions is a question that is unnecessary to investigate.) Some, at least, of that evidence, the respondent concedes should have been disclosed pursuant to cll 57-60 of the Statement of Prosecution Policy and Guidelines made and gazetted pursuant to the Director of Public Prosecutions Act 1991 (WA). "Disclosure of Crown Case The Crown has a general duty to disclose the case in-chief for the prosecution to the defence. 58. Normally full disclosure of all relevant evidence will occur unless in exceptional circumstances full disclosure prior to the trial will undermine the administration of justice, or when such disclosure may endanger the life or safety of a witness. Disclosure of Information to the Defence 59. When information which may be exculpatory comes to the attention of a prosecutor and the prosecutor does not intend adducing that evidence, the prosecutor will disclose to the defence – the nature of the information; the identity of the person who possesses it; and (c) when known, the whereabouts of the person. These details should be disclosed in good time." Callinan At this point it is relevant to note that the recent case of Grey v The Queen7 in this Court stands as authority for the proposition that the prosecution must at common law also disclose all relevant evidence to an accused, and that a failure to do so may, in some circumstances, require the quashing of a verdict of guilty. As will appear, the evidence which was not produced before or at this trial, was certainly no less cogent than the evidence which was not disclosed in Grey. Some of the further evidence related to the alleged murder weapon. In one interview, the appellant was asked what the assailant's weapon was. He replied, "A wrench". The appellant was asked to, and did draw a wrench, with the word "Sidchrome" on it. That drawing was an exhibit of which much was made at the trial. The deceased's husband said in evidence, with little conviction, that he thought that there may have been a Sidchrome spanner missing from a shed which his late wife used as a workshop behind the shop. The respondent had stressed both in opening and closing the prosecution case at the trial that the wrench drawn by the appellant was the murder weapon. When the appellant gave evidence he denied that he had told the police that Mrs Lawrence had been killed with a wrench. He said that his sketch of the wrench was: "a sketch of a supposed weapon that we were talking about in our theory which I said was a gas wrench to be used on acetylene equipment. I have no idea what a gas wrench looks like. That is what I assumed it would look like in my theory." There was in fact no acetylene equipment in the workshop. During the reference a number of contradictory facts were brought out for the first time and highlighted. These included that experiments had been done on behalf of the respondent with a crescent-shaped wrench of the kind said to be the murder weapon. The experiments conducted by a forensic pathologist and police officers, included the striking with a copper anode (of the kind kept in Mrs Lawrence's workshop), and a wrench, of a pig's head in an attempt, unsuccessful, to replicate Mrs Lawrence's wounds. Other facts relevant to the nature of the murder weapon are these. Residues of rust and Prussian Blue pigment had been found in Mrs Lawrence's (2001) 75 ALJR 1708; 184 ALR 593. Callinan wounds. The composition of Sidchrome wrenches is such that they rarely rust. Sidchrome spanners were sold unpainted. A layer of blue paint from a forklift located near the deceased's premises did contain Prussian Blue pigment. The forensic pathologist who undertook the experiment said that a wrench could not have caused many of the injuries because it would cause blunt, crushing-type injuries rather than the cuts and lacerations suffered by Mrs Lawrence. He had examined a variety of tools, including spanners, in a friend's workshop and had been unable to find one capable of matching the wounds sustained by Mrs Lawrence. Similarly, two investigating police officers, Detectives Brandon and Carter, had attempted without success to locate a wrench which would be likely to produce wounds similar to those inflicted on the scalp of Mrs Lawrence. In 2002, at the request of those acting on behalf of the appellant, the pathologist, Dr Cooke, performed a further experiment with a pig's head, using a Sidchrome spanner supplied to him, and again was not able to replicate the injuries sustained by Mrs Lawrence. Whether or not a pig's head would be susceptible to cutting and deformation in a way similar to a human head, was not the subject of detailed expert evidence, but clearly the prosecution's experts, in undertaking the experiment must have thought it to be of some utility. The disposition by the Court of Criminal Appeal of some of this relevant, potentially at least partially, exculpatory evidence was unsatisfactorily summary and almost entirely speculative8. "The material relating to the rust and the paint can be quickly disposed of. Although the petitioner's drawing of the wrench labelled it a 'Sidchrome', he also described it as 'rusty'. Two obvious possibilities, if a wrench/spanner were the relevant weapon, were either that he was mistaken in his recollection as to the brand, or alternatively that rust had adhered to it as a result of its having been stored with or used on some rusty object. So far as the paint was concerned, it does not seem to have been suggested at trial that the entire weapon was blue. Rather, it appears from the outset to have been more likely that it had some blue adhering to it. A layer of blue paint from the forklift was indistinguishable from the blue paint specks found in the deceased's head wounds. However, paint of that colour and composition is relatively common. There were further layers in the paint from the forklift, which were of a composition not reflected in material found in Mrs Lawrence's head wounds. For that reason (2003) 28 WAR 1 at 22 [88]-[90]. Callinan Mr Lynch, principal chemist at the Chemistry Centre WA, said in evidence on this appeal that he considered it unlikely that the forklift was the source of the paint in Mrs Lawrence's wounds. So far as the rest of the material is concerned, although it has a number of nuances and variations, the broad thrust of the petitioner's submission can be summarised as being to the effect that: a wrench could not have been the murder weapon; and this fact was known to the prosecution but not disclosed to the defence. Had the jury known that it could not have been the weapon, doubt would have been cast on the petitioner's confession to use of a wrench as the weapon. That proposition falls to be evaluated against the evidence given at trial, and the evidence given before us, as to the likely weapon." It was not for the Court of Criminal Appeal to seek out possibilities, obvious or otherwise, to explain away troublesome inconsistencies which an accused has been denied an opportunity to explore and exploit forensically. The body of unpresented evidence so far mentioned was potentially highly significant in two respects. The first lay in its capacity to refute a central plank of the prosecution case with respect to the wrench. The second was its capacity to discredit, perhaps explosively so, the credibility of the prosecution case, for the strength of that case was heavily dependent on the reliability of the confessional evidence, some of which was inexplicably not recorded, although it should have been recorded. The Court of Criminal Appeal also seems to have been overly impressed by evidence adduced by the respondent in rebuttal of the appellant's alibi, that he had at the time of the murder, been knocking on various doors looking for marijuana, from witnesses who said that they had heard no-one knocking on their doors. The disproof and rejection of the alibi did not mean that the appellant should on that account alone have been convicted. The appellant's evidence at the trial was that he had left a taxi at Bel Air Apartments, without paying (telling the taxi driver, Mr Peverall that he was going inside for money), shortly after 5 pm. While the driver waited, he entered the foyer and went through to another building, Dover Court, and then up to the top floor of it, to see whether the taxi had left. This he said, took about 20 minutes. Mr Peverall in examination in chief, said that he dropped the appellant off at Bel Air at about 4.45 to 5 pm and waited for about 20 minutes before returning to a nearby taxi rank and accepting a radio call at 5.22 pm. In cross-examination, after being shown evidence that he had given at a previous hearing that it could have been just before, or just after 5 o'clock, he said that it was "nearer to 5 o'clock". Uncontradicted evidence at the trial was that the time Callinan taken to walk from Bel Air flats to Mrs Lawrence's shop was five minutes, or by another route, two minutes and 40 seconds. Both routes followed a path, directly in front of Bel Air, where Mr Peverall was waiting for the appellant to return to pay his fare. Mr Peverall was of course looking out for him. That Mr Peverall did not see him strongly suggests that he did not pass that way. The body of evidence just summarized was capable, not only of establishing the appellant's absence from the scene of the murder at the time of it, but again, also of weakening the credibility of the confessional evidence. This was not a case, indeed few are, where the respective bodies of evidence can be taken as being in watertight compartments. It is to the confessional evidence that we now turn. It consisted of the sum of an unrecorded interview by Detective Sergeant Caporn on 10 June 1994, a further unrecorded interview by another police officer, Detective Sergeant Brandham on 17 June 1994, and a short videotaped interview after the unrecorded interview on that day. On the morning of 10 June 1994 the appellant was discharged from Graylands Hospital to answer a charge at the Central Law Courts in Perth. It was then that he was first interviewed. At 12.50 pm he was taken by police officers from the Central Law Courts to a police station where he was interviewed over a period of eight hours and 20 minutes with seven intervals. At trial he said that during the interview on 10 June 1994, he "was in total confusion to the point where anything that he [Detective Sergeant Caporn] suggested to me I would adopt." He was not, it may be observed, cautioned or charged during, or immediately before that interview. The interview on 17 June 1994 was unrecorded. It lasted three hours. It was (to the knowledge of those conducting it) conducted after the appellant had spent most of the previous evening at a nightclub, had been beaten, and had had little sleep. After the unrecorded interview of 17 June 1994, there was a videotaped interview of less than 30 minutes, described by the Court of Criminal Appeal as of a "very unusual nature". At the beginning of the interview, the appellant said: "I want to be video recorded so that I can be cleared." His closing words were that his account was "my version, my conjecture, of the scene of the crime." In this interview, he often spoke of himself in the third person (for example, "initially I entered into the room, or this person entered the room ... thinking that he was on his own"). He also spoke about Mrs Lawrence as if he were speculating about her conduct rather than reporting his observations of it (for example, "I would say she would have done ..."). Several times he was Callinan interrupted by the interviewers (for example, when he said, "Judging by the damage that was shown to me in photographs ..."). During it he offered further suggestions about the murder, such as: "DET SGT BRANDON [sic]: ... You said that you approached her from the rear of the shop and she asked you 'What are you doing here?' DET SGT BRANDON: Is that right? DET SGT BRANDON: Okay. And that you said to her that you were going to rob her. This is what you told us. Okay? MR MALLARD: This is what I imagine this person would say. DET SGT BRANDON: ... Now, you also said that she gave you a purse? DET SGT BRANDON: All right. MR MALLARD: I would say it would have to be a matching purse. Being a woman of taste, she would have had a matching handbag and a matching purse. At a last resort, I would have gone for a Glomesh bag. DET SGT BRANDON: Okay. All right. You told us that she was dressed in what? MR MALLARD: A skirt of some sort. Again, being a woman of taste and sophistication, she would have had to be --- worn a nice skirt like this, but one that joins up. DET SGT BRANDON: Right, and I think you said that you virtually ran there [the Stirling Bridge] from the scene? MR MALLARD: Would have had to. DET SGT BRANDON: Yeah. Callinan MR MALLARD: Or caught a train much --- probably at North Fremantle, but I don't think so because the tapes --- there's no videotapes of that day. DET SGT BRANDON: No problems. MR MALLARD: So he was either very fit or he had a push-bike." The Court of Criminal Appeal described the circumstances and contents of the appellant's "confessions" as "peculiar", adding that the appellant "said a number of things which were, to say the least, odd." Nonetheless, the Court concluded that the appellant had "persist[ed] in a pattern of grudging confession as his untrue accounts were rejected, together with a continuing attempt to mislead where possible." One of the peculiarities of course, was the appellant's use of the third person in referring to the killer. For example, in the interview of 10 June 1994 he spoke of the "evil person" who killed Mrs Lawrence, and of the emotions that this person would be feeling, also saying "it's murder and that's not The Court of Criminal Appeal did not refer to other peculiarities of the confession, which was illogically punctuated by denials that he was the murderer. During one interview, he agreed to give, and gave, a blood sample, saying "This will clear me." In the Court of Criminal Appeal the respondent submitted that 15 facts could be identified in the appellant's confession which only the murderer could know. In response, the appellant submitted that these were in truth inconsistent with known or established facts. The appellant submitted that the Court of Criminal Appeal erred in declining, as it did, to consider this submission. This error was a consequence of the Court's self-imposed limitation upon its duty to consider the whole case. Had the Court considered that submission it would have been bound to uphold it in part at least. Some examples will suffice. One to which we have already referred and need not repeat, is the evidence about the Sidchrome spanner which falls into the relevant category. The evidence of the blood patterns was different from the pattern that would probably have resulted had he struck Mrs Lawrence where he said he did. The evidence about the point, and his means of entry was, to say the least, unlikely to be true in the light of other evidence with respect to the securing of the front door of the shop. During one of the interviews the appellant said that he had "locked eyes" with a girl, Miss Barsden, the young daughter of an employee of the deceased. At trial, she said that she had seen a man in the shop, when the car in which she Callinan was seated was stationary, and that this person "ducked down" (beneath the counter) when he realized she was looking at him. Evidence was adduced at the reference of an ophthalmologist who had tested the appellant's eyesight and found it to be impaired to such an extent as to cast doubt on his ability to "lock eyes" with anybody. The eyewitness' evidence at the reference was relevantly as follows: "Q: Right? And I stared at him what I felt was longer than he was aware that I was looking at him. I feel that in my process of staring at this person, that when that person realised that someone was looking at him, and this is why I think he – anyway – the minute that I feel he saw me, he ducked down. Yes, so your recollection – and you have put it here, 'The man saw me looking at him.' Your view was that he realised you were looking at him and then ducked down? Yes, I think so. Sure. Would you agree that you couldn't say that you actually made eye contact with him in the sense of eyes looking into eyes? No, but I feel that in the process of staring at him and the process – that I feel that he looked directly at me and then that was followed by him bobbing down. I feel that he became aware that I was watching him. Quite. If you're looking at someone and that person has turned towards you and then suddenly bobs down, you would assume that he must have seen you looking at him? Yes. Coming back to my question, you're not saying, are you, that you were staring into each other's eyes? A: When he could see me he was ... Pardon? I could see him. I could see his eyes. I was looking at him. I feel that. Now, it's more that he saw me than eye contact ... Callinan Pardon? Eye to eye contact or ...? No. I was looking at him. Yes? And I feel that when he saw me looking at him ..." This witness, Miss Barsden, described the man whom she saw in the shop as a man of about six feet in height. The appellant is in fact six feet seven inches tall. The facial hair she described on the man she saw also differed from the appellant's, and it is likely that the headwear of the latter in turn differed from that which she observed on the man whom she saw in the shop. It is highly improbable that the perpetrator of the crime would not have had some of Mrs Lawrence's blood spattered on him or her. We interpolate that there were photographs in the possession of the respondent at the time of the trial of a large pool of blood on the floor of Mrs Lawrence's premises which, like the evidence of the experiments to which we have referred, were not produced until the reference. None of the deceased's blood was detected on the appellant or his clothing. The evidence was that the appellant explained its absence by saying that he had washed his clothes in salt water because salt water obstructed or distorted the results of scientific testing. Credible, subsequent, scientific evidence was introduced to the effect that salt water was not present in his clothing, and that had the appellant's clothes been immersed in it as he claimed, the heavy rain falling at the time would not have been sufficient to wash all salt out of the clothing. It is unnecessary to do more than refer briefly to some of the other matters relied on by the respondent as facts peculiarly within the knowledge of the murderer and known to the appellant. On examination, it can be seen that several of them were not in fact accurately or completely stated by him. His assessment of the number of blows struck was, for example, approximate and varied from time to time. There was in fact no necessary correspondence between the appellant's description of Mrs Lawrence's clothing and what in fact she was wearing when she was attacked. Similarly, there were discrepancies between the appellant's description of the premises and its actual configuration. The appellant denied that he had said much of what was attributed to him in the interviews by the police officers. The absence of any recording of most of the interviews is in these circumstances most unfortunate. Enough appears to indicate that there was substance in the appellant's contention in this Court that the Court of Criminal Appeal wrongly declined to entertain a submission that most or all of the matters said by the respondent to be Callinan uniquely within the murderer's knowledge, were not objectively true, or were contradicted by other matters, or were equivocal, or were patently false: and, in consequence, for those and other reasons, including the appellant's denial that he had said what was attributed to him about them, the so-called confessions were unreliable. There were numerous other matters relied on by the appellant, but we need refer to only one of them, his mental infirmity. The respondent submitted that the evidence of the appellant's psychiatric condition presented at the reference was neither fresh nor new: it was materially identical to evidence adduced at the voir dire at the trial in relation to the admissibility of the appellant's interviews with police. It was dealt with in this way by the Court of Criminal Appeal9: "One of the particulars of 'fresh evidence' which is relied upon to establish that the petitioner's confessions were unreliable and should not have been admitted, or that a jury which had that evidence would be likely to have a reasonable doubt relating to them, is said to be the evidence of the psychiatric illness of the petitioner which is contained in affidavits of On the other hand, although expert psychiatric evidence may have assisted the thrust of the submission outlined above, by confirming the petitioner's grandiose and unusual speech and thought patterns, there were apparent disadvantages associated with it. The evidence of Dr O'Dea at the voir dire described the petitioner at the relevant time as having been in a 'manic' state. He was described as liable to become 'up-tight and upset' and verbally threatening in situations of stress. He was described as having a 'rich fantasy life' but as being able to determine whether his ideas were fact or fantasy. The last of those observations might well have supported an inference that in his confessions, and particularly in the videotaped confession, the petitioner was quite able to distinguish between being asked about his own movements and being asked about some hypothetical murderer. The discussion of his 'manic' state could well have led to or strengthened a view that he was the type of person who might react disproportionately if, during the course of a robbery, Pamela (2003) 28 WAR 1 at 37-39 [169]-[175]. Callinan Lawrence became upset and hysterical, as the police alleged that he had said she did." There is considerable force in much of what the Court of Criminal Appeal said of the psychiatric evidence, its availability, its potential to damage the defence, and the forensic legitimacy of a decision not to lead it before a jury. But it had to be considered with the other evidence in obedience to a mandate to consider the whole of the case, and the whole of the case includes the evidence contradicting aspects of the appellant's confession. All of that provides a basis for further argument in favour of an inference that it should be treated as being of no or little reliability. In submissions counsel for the respondent made several concessions as to some of the matters that we have discussed. We need not repeat them. They were all properly made. They alone, the respondent accepted, would require that the conviction be quashed, unless the proviso, that no substantial miscarriage of justice had occurred, should be applied. He submitted it should be. We are unable to agree. The non-presentation of the evidence to which we have referred, and having the significant forensic value that we have identified, alone, precludes this. Taken with the other evidence that we have discussed, the appellant is entitled to have the verdict quashed. This rather than a remission of the case to the Court of Criminal Appeal to decide the reference in accordance with these reasons is the appropriate course because the only possible correct conclusion there would be that the conviction should be quashed. We would not however accede to the appellant's submission that a new trial should not be ordered. The appellant has already served many years of imprisonment. The case for the prosecution has now been shown to have its defects. But it also has its strengths. Those strengths include some parts of the confessional evidence, assuming it may, in the light of s 570D of the Criminal Code10 which was not then, but is now in force, be received. Its strengths also 10 Section 570D of the Criminal Code (WA) provides: "Accused's admissions in serious cases inadmissible unless videotaped (1) In this section – 'admission' means an admission made by a suspect to a member of the Police Force or an officer of the Corruption and Crime Commission, whether the admission is by spoken words or by acts or otherwise; (Footnote continues on next page) Callinan included the other circumstantial evidence. Having regard however to what has in total passed and emerged it would remain well open to the respondent to elect not to have the appellant retried if it were so minded. 'serious offence' means an indictable offence of such a nature that, if a person over the age of 18 years is charged with it, it can not be dealt with summarily and in the case of a person under the age of 18 years includes any indictable offence for which the person has been detained. (2) On the trial of an accused person for a serious offence, evidence of any admission by the accused person shall not be admissible unless – the evidence is a videotape on which is a recording of the admission; or the prosecution proves, on the balance of probabilities, that there is a reasonable excuse for there not being a recording on videotape of the admission; or the court is satisfied that there are exceptional circumstances which, in the interests of justice, justify the admission of the evidence. (3) Subsection (2) does not apply to an admission by an accused person made before there were reasonable grounds to suspect that he or she had committed the offence. (4) For the purposes of subsection (2), 'reasonable excuse' includes the following – (a) The admission was made when it was not practicable to videotape (b) Equipment to videotape the interview could not be obtained while it was reasonable to detain the accused person. (c) The accused person did not consent to the interview being videotaped. (d) The equipment used to videotape the interview malfunctioned." Callinan The appeal should be allowed, the orders of the Court of Criminal Appeal set aside and in place thereof it should be ordered that the conviction of the appellant be quashed, and that there be an order for retrial of the appellant. Kirby KIRBY J. This appeal11 concerns the exercise by the Court of Criminal Appeal of Western Australia, in 2003, of powers conferred upon it to determine a petition invoking the Royal Prerogative of Mercy12. Mr Andrew Mallard ("the appellant") protests his innocence of the murder of Mrs Pamela Lawrence ("the deceased"). Her death occurred in Perth on 23 May 1994. At his trial, the appellant was found guilty by a jury and was convicted. An appeal against his conviction was dismissed in 1996 by the Court of Criminal Appeal13. An application made to this Court in 1997 for special leave to appeal was refused14. In 2003, the Court of Criminal Appeal having once again rejected the appellant's "appeal"15, application for special leave was renewed. This time it was successful. Whereas the earlier attempt to engage the attention of this Court was addressed principally at the suggested miscarriage of justice occasioned by interviews by police, partly unrecorded and unconfirmed 16, the present appeal has been concerned with the "whole case"17 brought against the appellant at trial and the defects and errors said to have arisen there, with the suggested consequence that the jury's verdict of guilty was unreasonable or unsustainable18, warranting the setting aside of the appellant's conviction. In particular, whilst maintaining the 1997 complaints concerning the unrecorded and unconfirmed confessions to police, the appellant added new and different criticisms about the conduct of his trial. The chief thrust of the appellant's present submissions to this Court 11 From the Court of Criminal Appeal of the Supreme Court of Western Australia: Mallard v The Queen (2003) 28 WAR 1. 12 Pursuant to the Sentencing Act 1995 (WA), s 140 ("the Sentencing Act"). The text of the section is set out in the reasons of Gummow, Hayne, Callinan and Heydon JJ at [2] ("the joint reasons"). 13 Mallard v The Queen unreported, Court of Criminal Appeal (WA), 11 September 1996 (Malcolm CJ, Ipp and Wallwork JJ). 14 Mallard v The Queen P52/1996 (24 October 1997) noted (1997) 191 CLR 646 (Toohey and McHugh JJ and myself). No objection was raised by either party to this appeal to my participation in the disposition. 15 The reference of the petition to the Court of Criminal Appeal engages the jurisdiction of the Court of Criminal Appeal "as if it were an appeal by the offender". See Sentencing Act, s 140(1)(a) set out joint reasons at [2]. 16 Mallard v The Queen P52/1996 (24 October 1997), special leave transcript at 2. 17 Sentencing Act, s 140(1)(a). 18 Criminal Code (WA), s 689(1) ("the Code"). Kirby concerns the suggested non-disclosure (or suppression) by the prosecution of material evidence which, it was said, had deprived the appellant of a fair trial19. In my opinion, the appellant has, on this occasion, made good his complaints about his trial. The Court of Criminal Appeal, in deciding the issues raised in the appellant's petition, erred both in its approach and in its conclusions. The appellant's conviction must be quashed and consequential orders made. The facts and legislation The background facts are stated in the joint reasons20. Also set out in those reasons are the provisions of the Sentencing Act, providing for the reference of the appellant's petition to the Court of Criminal Appeal21, and the provisions of the Code22 which govern the determination of an appeal to the Court of Criminal Appeal. Pursuant to the Sentencing Act, a petition, once referred, is taken to be such an appeal23. The provisions of the Code contain a "proviso" permitting the judges in the appellate court to dismiss an appeal "if they consider that no substantial miscarriage of justice has actually occurred"24. Essentially, in the second "appeal" before the Court of Criminal Appeal, the case turned on the application of the "proviso". This was so, because, properly, the prosecution conceded that, in a number of respects, material evidence ought to have been disclosed to the 19 Two issues argued in the Court of Criminal Appeal in 2003 were excluded by order of the Panel which heard the second special leave application (McHugh, Hayne and Callinan JJ). The first was the specific relevance of the appellant's psychiatric illness, which was propounded as an explanation of his peculiar statements and speculations in his "confessions" to police. The evidence showed that the appellant was suffering from bipolar or unipolar disorders and had spent time in Graylands Mental Institution in Perth, including at a time close to the murder of the deceased. See (2003) 28 WAR 1 at 37-39 [169]-[176]. The second was an argument concerning the use of polygraph tests. This issue was dealt with by the Court of Criminal Appeal: see (2003) 28 WAR 1 at 44-76 [201]-[374]. 20 Joint reasons at [14]-[39]. 21 ss 137-141. See also the previous provision of the Code, s 21 set out in the joint reasons at [3]. 22 s 689(1) and (2). See joint reasons at [7]. Kirby defence at trial by the prosecution but had not been25. This concession (whether or not involving the Director of Public Prosecutions in the non-disclosure26) arguably established the existence of an unreasonable or unsustainable verdict. The continued concentration by the Court of Criminal Appeal upon the appellant's attack on the confessional evidence27, together with the narrow view which that Court took of its jurisdiction and powers, diverted their Honours from a proper consideration of the cumulative effect of the non-disclosure (or suppression) of evidence material to the appellant's guilt of the crime charged (or, as expressed by the appellant, of his innocence of that crime). The issues Four issues in the appeal: There are four issues in the appeal: The "whole case" issue: Whether the Court of Criminal Appeal erred in the approach that it adopted with respect to the hearing of the appeal that was before it on the reference by the Attorney-General. Whether, given its obligation to hear "the whole case" and to determine such case as required by law28, that Court was obliged to consider and determine all questions of fact and law involved in the case (as the appellant contended) or authorised to adopt the narrower approach that it had done (as the respondent argued). The unsustainable verdict issue: Whether, within the Code29, and adopting the correct approach to the "whole case", the Court of Criminal Appeal erred in failing to conclude that the verdict of the jury (and thus the conviction) should be set aside on the ground that it was unreasonable or could not be supported having regard to the evidence or otherwise that there had been a miscarriage of justice. The proviso issue: Whether, if it is concluded that the verdict of the jury was unreasonable or was otherwise flawed, the appellant's conviction should nonetheless be sustained on the basis that, by reference to the 25 (2003) 28 WAR 1 at 25 [106], 29 [126], 32 [137]. 26 (2003) 28 WAR 1 at 79 [387]. 27 (2003) 28 WAR 1 at 16 [58]. 28 Sentencing Act, s 140(1)(a). Kirby entirety of the evidence, no substantial miscarriage of justice had actually occurred. The disposition issue: Whether, if the foregoing issues are decided in the appellant's favour, this Court should enter an acquittal (as the appellant submitted) or direct a retrial (as the respondent urged). Common ground in some issues: On the bases stated in the joint reasons, I agree that the Court of Criminal Appeal erred in its approach to the discharge of its functions. It took too narrow a view of its jurisdiction and powers. This was inconsistent with the statutory language (with its reference to "the whole case") and with relevant decisional authority addressing the same or similar statutory provisions30. I also agree with the joint reasons that, once the correct approach is adopted and the evidence at trial analysed, this is not a case where the proviso should be applied31. For the reasons stated, and to bring this protracted saga closer to finality, the proper course is for this Court to dispose of the proceedings and not to remit them for a third hearing in the Court of Criminal Appeal. These conclusions confine my reasons to the errors in the trial that render the jury's verdict unreasonable or unsupportable (most especially the multiple instances of non-disclosure or suppression of material evidence by the prosecution) and the actual order of disposition that should be made. I will deal with these points in turn. They ultimately bring me to a conclusion identical to that reached in the joint reasons. The cumulative instances of non-disclosure Instances of non-disclosure: The facts relevant to this aspect of the appeal emerge both from the evidence at the appellant's trial (which lasted ten days) and from "fresh" evidence agreed in the Court of Criminal Appeal in the present proceedings. The facts are detailed and complex. They are sketched in outline in the joint reasons. However, it is important to consider the cumulative effect of the non-disclosure or suppression of material evidence in the hands of the police and thus available to the prosecution. It is the cumulation, variety, number and importance of such evidence that is critical to my conclusion that a miscarriage 30 Mickelberg v The Queen (1989) 167 CLR 259 at 312; R v Chard [1984] AC 279 at 291. See joint reasons at [10]. 31 Joint reasons at [42]. Kirby of justice occurred in the appellant's trial. I shall mention the most important of this evidence in summary form: The pig's head experiment: A significant element in the prosecution case against the appellant was his alleged confession that he had committed the brutal murder of the deceased using a wrench, which he had procured from a shed at the rear of the deceased's jewellery shop, to strike the deceased's head. The appellant's explanation of the reference to the wrench was that it was simply his "theory" of the mechanism of the deceased's death. But at trial the term "wrench" was repeatedly used to describe the murder weapon as if it was established that this was the way the death of the deceased had been caused. A sketch by the appellant of a Sidchrome wrench became an exhibit in the trial. What was not disclosed at the trial to those representing the appellant (but disclosed to the Court of Criminal Appeal in a comprehensive summary of facts agreed between the parties32) was that, before the trial, an experiment had been conducted for police by striking a pig's head with a wrench similar to that drawn by the appellant in order to compare the wounds thereby inflicted with those disclosed in the deceased's head. The conclusion of those conducting this experiment was that the wounds were "dissimilar". After a second test conducted with a similar wrench, Dr Cooke, a forensic expert, concluded that such a wrench "could not have caused many of the injuries to the Deceased because it had a blunt crushing type mechanism rather than a chopping type mechanism". Although the experiment with the pig's head was discussed by Dr Cooke with police officers and with the prosecutor before the trial, the conduct of the experiment and its outcome were not revealed to the defence. The salt-water experiment: There was strong evidence at the trial that the infliction of multiple blows on the skull of the deceased would have caused a spattering of blood in all directions. This was confirmed by the blood spatters around the partition in the deceased's shop where the deceased was first attacked. One small spot of blood alone was found on the only shoes that the appellant owned. It was proved not to be blood from the deceased. It was consistent with the appellant's own blood. The appellant's "confession" to police had him going "down to the river ... and wash[ing] his clothing" after the attack, inferentially to remove blood stains. At the point of the river identified in this "confession", the clothes would have been exposed to the presence of salts in the river water. In its original form, a six page report for police by Mr Lynch contained two 32 (2003) 28 WAR 1 at 21 [87]. Kirby pages under the heading "Examination of clothing for immersion in river water". However, at the request of police, a second version of the report was produced omitting those two pages. The missing two pages were never disclosed to the defence. Yet the undisclosed part of the report concluded that "[t]he residual soluble salts detected in the clothing items are not consistent with immersion in river water … unless they were subsequently washed in fresh water". The respondent sought to explain this discrepancy by referring to the fact that it had been raining on the evening of the deceased's murder. However, further experiments by Mr Lynch showed that, even in significant rainfall, the levels of salts in clothing soaked in river water remained clearly detectable. The missing cap: The appellant's "confession" to police had it that he was wearing a cap with a gold border turned backwards. This was said to be consistent with the evidence of the witness Ms Barsden who described a person whom she had momentarily seen in the deceased's shop at about the time of the murder. However, a prosecution witness, Ms Michelle Engelhardt, had made a handwritten statement only a few days after the deceased's murder. This stated that the appellant's familiar cap remained on a hook in her apartment on the afternoon of the murder. Ms Engelhardt said that, when the appellant arrived at her apartment that evening, he was not wearing any headgear at all and his hair was wet, inferentially from the rain. However, all references to the whereabouts of the appellant's cap, his wet hair and lack of headgear were removed by police from Ms Engelhardt's original statement. The police prepared a second, typed, statement which deleted this information. It was agreed before the Court of Criminal Appeal that Ms Engelhardt's original handwritten statement had not been disclosed to the defence at the trial, although it was in the possession of the police and although it contained material casting doubt upon the link that the prosecution had sought to make between the appellant and the presumed assailant seen by Ms Barsden. The undisclosed sketches: The day after the murder, Ms Barsden signed a statement for police. This stated that, at her mother's suggestion, when she had arrived home, she had drawn sketches of the man she had seen in the deceased's shop. Her original statement referred to these sketches. However, that version of the statement was not given to the defence. In the statement that was later produced, the reference to the sketches was deleted by police. There were discrepancies between the undisclosed sketches and the appearance of the appellant at the time of the attack on the deceased. The appellant then had a large and clearly visible moustache. There was no moustache in the sketches. The sketches showed a person with a beard; whereas the appellant had none. Ms Barsden further described the person she saw as having a scarf tied "like a gypsy" on his head with no hair visible. However, a taxi driver, Mr Peverall, who had seen the appellant at the Bel Air apartments minutes Kirby before the murder occurred, mentioned no hat, cap or headgear. He described the appellant's hair as "fairly long" and "untidy". Ms Barsden described the person she saw as of "medium build" whereas Mr Peverall, accurately, described the appellant's build as "slim". The locking of eyes: The appellant denied that he had said that he "locked eyes" with a girl passing by the shop where the deceased was killed. However, in an original police statement this phrase had been attributed to him. The phrase was deleted from the draft witness statement provided to the defence. Evidence, referred to in the joint reasons33, concerning defects in the appellant's vision, made it extremely unlikely that he would "lock eyes" with anyone sitting in a passing car outside the deceased's shop. Still less was it likely that the appellant would ever say so. The removal of the expression from the statement, as supplied, lends weight to the suggestion that the "verbal confession" attributed to the appellant amounted, in substantial parts at least, to words chosen by police rather than by the appellant. And that the later deletion of the statement was designed to remove an obvious source of discrepancy that could be brought out by cross-examination. The man wearing a bandanna: Two witness statements, which were not disclosed to the defence, described a man seen wearing a bandanna on his head and behaving erratically within three kilometres of the scene of the murder several hours before it happened. At the time described, the appellant was detained in relation to another charge in the East Perth lockup. Accordingly, he could not have been the person described as wearing the bandanna. Yet the person so described more closely fitted Ms Barsden's description of the person she had seen and with whom she had "locked eyes". This was a man described as of five foot eleven inches (180 centimetres) wearing a "gypsy style bandanna". The appellant was much taller than the person so described (six foot six inches or 198 centimetres). He did not use that form of head-dress. The existence in the vicinity of a person more closely fitting the description of the man seen in the deceased's shop at about the time of the murder, would have been a fruitful source of evidence and argument before the jury in the defence case. Conclusion: material non-disclosures: A review of the foregoing and other evidence, which was not disclosed to the appellant's counsel at the trial, but which was in the possession of police and, at the least, available to the prosecution, suggests strongly that material evidence was not disclosed that bore upon the guilt of the appellant of the crime charged in the indictment. Whilst the 33 Joint reasons at [35]. Kirby non-disclosure of one or two of these items (eg items (4) and (6)), taken alone or perhaps together, might not have been sufficient to produce an unreasonable or unsupportable verdict, with a miscarriage of justice in the trial, a consideration of the totality of the unrevealed evidence raises a stark question as to the safety of the appellant's conviction. Of particular concern are the items in which evidentiary material, consistent with innocence and presenting difficulties for the prosecutor's hypothesis of guilt, were actually suppressed or removed from the material supplied to the defence. The important issue of legal principle in this appeal is whether such non-disclosures and suppression deprived the appellant of a fair trial. Approach to prosecution non-disclosures The WA prosecution guidelines: Pursuant to the Director of Public Prosecutions Act 1991 (WA)34, the Director of Public Prosecutions of Western Australia issued a statement, operative from 1 November 1992, on "Prosecution Policy and Guidelines" ("the Guidelines"). The statement was published in the Western Australian Government Gazette35. It applied to the conduct of the prosecution in relation to the appellant's trial. The Guidelines were stated to be "based on, and developed from, the Crown's longstanding prosecution policy in Western Australia". They were said to take account of, and to incorporate, the Guidelines on the Role of Prosecutors adopted by the Eighth United Nations Congress on the Prevention of Crime and Treatment of Offenders of 1990 ("the United Nations Guidelines")36. Indeed, the United Nations Guidelines are annexed to the Western Australian Guidelines. The most important paragraphs of the Guidelines governing the disclosure of the prosecution case and provision of information to the defence are set out in the joint reasons37. I would add, however, reference to the following additional paragraphs of the Guidelines: If a prosecutor knows of a person who can give evidence which may be exculpatory, but forms the view that the person is not credible, the prosecutor is not obliged to call that witness. 35 No 155, 3 November 1992 at 5418. 36 See Guidelines, par 5. 37 Guidelines, pars 57-60. See joint reasons at [16]. Kirby In either case, the Crown, if requested by the defence, should subpoena the person. If the prosecutor possesses such exculpatory information but forms the view that the statement is not credible or that the subject matter of the statement is contentious, the prosecutor is not obliged to disclose the contents of the statement to the defence, but should inform the defence of the existence of the information and its general nature. 64. However, if the prosecutor is of opinion that the statement is credible and not contentious, then a copy of that statement should be made available to the defence in good time." The foregoing paragraphs (at least pars 61 and 63) are designed to relieve the prosecution of obligations to produce to the defence the text of statements made by collaborators, supporters and friends of the accused. In the present case, the unprovided and suppressed materials did not fall into that category. Without exception, they were statements procured in the preparation of the police brief for ultimate tender to the prosecutor. At least some of them were certainly known to the prosecutor. All of them would have been available to the Director of Public Prosecutions. Where a form of statutory instrument is adopted, enjoying authority under an Act of the Parliament, it prevails, to the extent of any inconsistency, over principles of the common law. However, it is clear from the language and purpose of the Guidelines that they were not intended to expel the operation in Western Australia of the general principles of the common law on prosecution disclosures. Instead, they were intended to express, clarify, elaborate and make public the "longstanding prosecution policy" that had developed conformably with the common law. Moreover, as noted above38, they were intended to give effect to international principles which, in turn, were designed to ensure observance of "human rights and fundamental freedoms recognised by national and international law"39. This Court's authority: The consequence of an omission of the prosecution in a criminal trial to supply to the defence statements of material witnesses was considered by this Court in Lawless v The Queen40. There, a 38 These reasons at [60]. 39 United Nations Guidelines, par 2(b). 40 (1979) 142 CLR 659. The case came from the Full Court of the Supreme Court of Victoria, sitting as the Court of Criminal Appeal, considering a petition under s 584 of the Crimes Act 1958 (Vic). Kirby majority41 refused special leave to appeal against the dismissal of a petition of mercy on the ground that the "fresh evidence" relied upon would not have been likely to have led to a different result in a new trial. Murphy J, dissenting as to the result42, observed that the trial judge had directed the prosecution to hand over to the applicant copies of all statements by witnesses. The prosecutor having disobeyed this direction by failing to hand over one such statement which "could have been useful to the applicant … [i]n the way the trial ran", Murphy J considered that the applicant had suffered a miscarriage of justice on the ground of the suppression of the evidence in and of itself. In R v Apostilides43, this Court affirmed the responsibility borne by a prosecutor in the conduct of a criminal trial. However, it acknowledged the jurisdiction of courts of criminal appeal to consider the consequences of the prosecutor's decision where, for example, an election not to call a particular person as a witness, when viewed against the conduct of the trial taken as a whole, could be seen to have given rise to a miscarriage of justice44. The Court emphasised that the object of judicial scrutiny in such cases was not to discover whether there had been "misconduct" by the prosecution. It was to consider whether, in all of the circumstances, the verdict was unreasonable or unsupportable in the statutory sense45. A case involving a more explicit failure of the prosecution, being a failure to reveal that a key prosecution witness had been given a letter of comfort by an investigating police officer despite "widespread and deep involvement" in crimes of the type charged against the accused, was Grey v The Queen46. The question in that case became whether the non-disclosure in question had occasioned a miscarriage of justice that was not insubstantial and had deprived the accused of a fair chance of acquittal. It was held that it was not reasonably necessary for the accused in that case to "fossick for information" to which he was entitled in the proper conduct of the prosecution against him47. The Guidelines considered in 41 Barwick CJ, Stephen, Mason and Aickin JJ; Murphy J dissenting. 42 (1979) 142 CLR 659 at 683. 43 (1984) 154 CLR 563. 44 (1984) 154 CLR 563 at 575. 45 (1984) 154 CLR 563 at 578. The phrase used was "unsafe or unsatisfactory". See now Gipp v The Queen (1998) 194 CLR 106 at 147-150 [120]-[127]. 46 (2001) 75 ALJR 1708 at 1712 [16]; 184 ALR 593 at 598. 47 (2001) 75 ALJR 1708 at 1713 [23]; 184 ALR 593 at 599-600. Kirby that case, issued under the Director of Public Prosecutions Act 1986 (NSW), were not materially different from the Guidelines applicable to the present appeal48. The determining consideration in Grey was that the undisclosed material was highly relevant to the credibility of several of the witnesses called by the prosecution against the accused and to the evaluation of the accused's own case. The same can be said of the undisclosed evidence in these proceedings. In Grey, the appeal was upheld. The respondent did not contest its failure to provide relevant materials to the appellant. It could scarcely do so, having regard to the agreed facts. Thus, upon this issue, both in the Court of Criminal Appeal and in this Court, the question became one of the significance of such failure. As in Lawless, Apostilides and Grey, that question took the Court to the statutory provisions governing criminal appeals. However, in giving effect to those provisions, it is useful to consider the approaches taken in other countries that follow, as Australia does, the accusatory form of criminal trial, adapted from England. Allowing that it often reflects local constitutional and statutory law, when such authority is examined the considerations given weight by the courts suggest an increasingly insistent demand for the provision of material evidence known to the prosecution which is important for the fair trial of the accused and the proper presentation of the accused's defence. Exceptions exist. However, they are comparatively few and closely defined. Such an approach has been judged essential to the conduct of a fair trial of criminal accusations in many countries. North American cases: In the United States of America, suppression by the prosecution of evidence favourable to an accused, where it is material to guilt or punishment, may be judged a violation of the due process requirements of the Fourteenth Amendment to the Constitution49. Although Australia has no such constitutional provision, many of the notions that are protected by the Fourteenth Amendment are familiar to us given that, in criminal trials, the primary purpose of that constitutional protection is to ensure against miscarriages of justice that are equally abhorrent to our law50. In United States cases, as in the Guidelines applicable here, a distinction is drawn between the prosecutor's duty in respect of exculpatory evidence and evidence casting doubt on the truthfulness of other prosecution witnesses51. In a recent case, bearing some similarity to Grey, the Supreme Court of the United 48 (2001) 75 ALJR 1708 at 1717 [46] fn 37; 184 ALR 593 at 605. 49 Brady v Maryland 373 US 83 at 87 (1963). 50 United States v Bagley 473 US 667 at 675 (1985). 51 United States v Agurs 427 US 97 (1976); Bagley 473 US 667 at 675 (1985). Kirby States allowed an appeal where the State had failed to disclose that one of the witnesses upon whom it had relied was a paid police informant52. If the undisclosed or suppressed evidence is judged such as to create a "reasonable probability"53 that a different result might have ensued had the evidence been disclosed to the defence at an appropriate time, a new trial will generally be ordered. In language that recurs in the decisions of many courts on this issue, the Supreme Court of the United States has declared that the central question is "whether in [the] absence [of the material evidence, the accused] received a fair trial, understood as a trial resulting in a verdict worthy of confidence"54. The Supreme Court has explained that it is not the duty of the prosecutor to "deliver his entire file to defence counsel"55. Still less is it to conduct the defence case. The ambit of the duty of disclosure, however, is one deriving from the very character of the criminal process. Prudent prosecutors, it is said, will always resolve doubtful questions in favour of disclosure56. They will do so in recognition that the role of the prosecutor is as57: "the representative not of an ordinary party to a controversy, but of a sovereignty whose obligation to govern impartially is as compelling as its obligation to govern at all; and whose interest, therefore, in a criminal prosecution is not that it shall win a case, but that justice shall be done." Many of the same considerations have been upheld in the Supreme Court of Canada, including since the adoption of the Canadian Charter of Rights and Freedoms. Thus in R v Stinchcombe58, Sopinka J59 referred to the duties of prosecutors in Canada which render "the fruits of the investigation … not the property of the Crown for use in securing a conviction but the property of the public to be used to ensure that justice is done". 52 Banks v Dretke 540 US 668 (2004). 53 Kyles v Whitley 514 US 419 at 434 (1995). 54 Kyles 514 US 419 at 434 (1995). See also Strickler v Greene 527 US 263 (1999). 55 Agurs 427 US 97 at 111 (1976); Bagley 473 US 667 at 675 (1985). 56 Agurs 427 US 97 at 108 (1976). 57 Berger v United States 295 US 78 at 88 (1935). See also Strickler 527 US 263 at 58 [1991] 3 SCR 326. 59 [1991] 3 SCR 326 at 333. Kirby In Canada, as elsewhere, non-disclosure is excused in particular cases, such as where the evidence is beyond the control of the prosecution, is privileged or is clearly irrelevant. However, otherwise, a high duty of disclosure has been affirmed60. The criterion usually applied is the entitlement of the accused to a fair trial61. In Canada, where undisclosed evidence appears material, it is for the Crown to bring itself within an exception to the general rule mandating disclosure. The rigour of this principle has doubtless been enhanced by the adoption of the Charter62. But similar principles have been observed, for like reasons, in countries lacking such express constitutional provisions. British and Irish cases: In the United Kingdom, the common law test required disclosure of material in the possession of the prosecution as "[a]n incident of a defendant's right to a fair trial"63. The prosecutor's duty in Britain is now governed by legislation64. Such legislation modifies, to some extent, the accusatorial character of criminal trials65. The procedures have been adapted accordingly. This fact makes more recent judicial authority in the United Kingdom of less significance for Australia. However, in R v Brown, Lord Hope 60 R v Egger [1993] 2 SCR 451 at 466 per Sopinka J; R v Chaplin [1995] 1 SCR 727 at 739 [21] per Sopinka J; R v O'Connor [1995] 4 SCR 411 at 428 [4] per Lamer CJ and Sopinka J; R v Mills [1999] 3 SCR 668 at 716-717 [69]-[70] per McLachlin and Iacobucci JJ; R v Taillefer [2003] 3 SCR 307 at 313-314 [1] per LeBel J. 61 R v Lyons [1987] 2 SCR 309 at 362; Mills [1999] 3 SCR 668 at 718 [72]. 62 Stinchcombe [1991] 3 SCR 326 at 336 per Sopinka J. 63 R v Ward [1993] 1 WLR 619 at 674; [1993] 2 All ER 577 at 626. See United Kingdom, Royal Commission on Criminal Justice, Report, (1993) Cm 2263 at 95 64 Criminal Procedure and Investigations Act 1996 (UK). The procedures there provided have been amended by the Criminal Justice Act 2003 (UK). See Sprack, "The Criminal Procedure and Investigations Act 1996: (1) The Duty of Disclosure", (1997) Criminal Law Review 308. 65 The suggested correlative need in Australia to consider immunities of the accused has been discussed: Moen, "Criminal Trial Reform – At What Cost?", (2000) 27(4) Brief 17; cf Ling (1996) 90 A Crim R 376 at 380 per Doyle CJ. 66 [1998] AC 367 at 377. Kirby "The prosecution is not obliged to lead evidence which may undermine the Crown case, but fairness requires that material in its possession which may undermine the Crown case is disclosed to the defence. … [T]he prosecution is not obliged to lead the evidence of witnesses who are likely in its opinion to be regarded by the judge or jury as incredible or unreliable. Yet fairness requires that material in its possession which may cast doubt on the credibility or reliability of those witnesses whom it chooses to lead must be disclosed." Subject to any exceptions provided by statute or common law, I would accept this as a statement expressing the common law rule in this country. Its foundation, as Lord Hope explained, lies in "the principle of fairness [which is] at the heart of all the rules of the common law about the disclosure of material by the prosecutor"67. In Scotland, which follows a different criminal procedure, a like duty of disclosure applies to the Crown in respect of "information in their possession which would tend to exculpate the accused"68. Similarly, in the Irish Republic, the courts have followed the general principles expressed by the English cases69. Specifically, where the prosecution has a statement by a person in a position to give material evidence, who will not be called as a prosecution witness, it is "in general" under a duty to make available to the defence any statements that the The English authorities have been influential throughout Commonwealth countries. A similar rule of prosecution disclosure is observed in New Zealand71 where Lord Hope's approach in Brown has been followed. Demonstrating the generality and strictness of the rule, in Hong Kong, since its separation from the Crown, the courts have continued to observe the principle that, if disputed material is in the possession of the prosecution, which 67 [1998] AC 367 at 379. 68 McLeod v HM Advocate (No 2) 1998 JC 67 at 79 per Lord Rodger. 69 The People (DPP) v Kelly [1987] IR 596. 70 Ward v Special Criminal Court [1998] 2 ILRM 493 at 500. 71 Commissioner of Police v Ombudsman [1988] 1 NZLR 385; R v Shaqlane unreported, Court of Appeal of New Zealand, 5 March 2001; R v Taylor unreported, Court of Appeal of New Zealand, 17 December 2003. Kirby may help prove a defendant's innocence or avoid a miscarriage of justice, "the balance comes down resoundingly in favour of disclosing it"72. International law decisions: The explicit introduction into the Guidelines in Western Australia of reference to international statements about human rights makes it relevant, in considering what flows from non-disclosure or suppression of material evidence in this case, to notice decisions concerning the requirements of the International Covenant on Civil and Political Rights73 binding on Australia74 and of the doctrine established by courts elucidating the similar or analogous provisions of the European Convention for the Protection of Human Rights and Fundamental Freedoms75 ("the European Convention"). In Edwards v United Kingdom76, the European Court of Human Rights affirmed that the requirement in Art 6(1) of the European Convention, entitling everyone to a "fair and public hearing … by an independent and impartial tribunal established by law", extended, in a criminal prosecution, to a requirement that "the prosecution authorities disclose to the defence all material evidence for or against the accused"77. The Court noted that this was also a requirement recognised under English law. It is one that has been reinforced in more recent times by the European Court's decision in Fitt v United Kingdom78. There, the Court observed79: "It is a fundamental aspect of the right to a fair trial that criminal proceedings … should be adversarial and that there should be equality of arms between the prosecution and defence. … [B]oth prosecution and 72 R v Keane [1994] 1 WLR 746 at 751-752; [1994] 2 All ER 478 at 484 applied in HKSAR v Lau Ngai Chu [2002] HKEC 291 and HKSAR v Lee Ming Tee (2003) 6 HKCFAR 336. 73 [1980] Australian Treaty Series No 23. 74 Art 14.3(b) and (c). See Mabo v Queensland [No 2] (1992) 175 CLR 1 at 42. 75 213 United Nations Treaty Series 222. 76 (1992) 15 EHRR 417. 77 (1992) 15 EHRR 417 at 432. 78 (2000) 30 EHRR 480. 79 (2000) 30 EHRR 480 at 510 [44] (footnotes omitted). See discussion Hinton, "Unused Material and the Prosecutor's Duty of Disclosure", (2001) 25 Criminal Law Journal 121 at 135. Kirby defence must be given the opportunity to have knowledge of and comment on the observations filed and the evidence adduced by the other party. In addition Article 6(1) requires, as indeed does English law, that the prosecution authorities should disclose to the defence all material evidence in their possession for or against the accused." The European Court of Human Rights has recognised that the duty of disclosure is not absolute or precisely reciprocal in an accusatorial system. The duty may permit prosecution non-disclosure for reasons of competing interests such as national security; or to protect witnesses at risk of reprisal; or to keep secret police methods of investigating certain crimes; in some cases to preserve the fundamental rights of another individual; or to safeguard an important public interest80. However, even where such exceptions exist, the European Court has insisted that it remains the accused's right to receive a fair trial and any difficulties caused by limitations on the right to disclosure must be "sufficiently counterbalanced by the procedures followed by the judicial authorities"81. Considerations such as these have led, in accusations of terrorism offences, to the adoption of new procedures involving "special advocates"82. Non-disclosure of evidence: conclusions The applicable principles: The foregoing review of the approach of courts, in national and international jurisdiction, indicates the growth of the insistence of the law, particularly in countries observing the accusatorial form of criminal trial83, of the requirement that the prosecution may not suppress evidence in its possession, or available to it, material to the contested issues in the trial. It must ordinarily provide such evidence to the defence. Especially is this so where the material evidence may cast a significant light on the credibility or reliability of material prosecution witnesses or the acceptability and truthfulness of exculpatory evidence by or for the accused. According to the principles expressed (as in Apostilides), this Court will not second guess the prosecutor in the decisions that have to be made in presenting the prosecution case. Still less is the prosecutor burdened with an obligation to present the defence case (which, in any event, may not always be known in advance of the trial). The obligation imposed by the law is to ensure a fair trial for the accused, remembering the special requirements that descend 80 Fitt (2000) 30 EHRR 480 at 510-511 [45]. 81 Fitt (2000) 30 EHRR 480 at 511 [45]. 82 R v H [2004] 2 AC 134 at 149-150 [21]. 83 RPS v The Queen (2000) 199 CLR 620 at 630 [22]. Kirby upon a prosecutor, who represents not an ordinary party but the organised community committed to the fair trial of criminal accusations and the avoidance of miscarriages of justice. Ultimately, where there has been non-disclosure or suppression of material evidence, which fairness suggests ought to have been provided to the defence, the question is whether the omission has occasioned a miscarriage of justice. This is so both by the common law and by statute84 (and in some jurisdictions by constitutional mandate). The courts are guardians to ensure that "justice is done" in criminal trials85. Where the prosecutor's evidentiary default or suppression "undermines confidence in the outcome of the trial"86, that outcome cannot stand. A conviction must then be set aside and consequential orders made to protect the accused from a risk of a miscarriage of justice. At least, this will follow unless an affirmative conclusion may be reached that the "proviso" applies – a conclusion less likely in such cases given the premise. In a case of very limited non-disclosure which the appellate court concludes affirmatively to have been unlikely to have altered the outcome of the criminal trial, the proviso may be applied as it was in Lawless87. However, in a case where the non-disclosure could have seriously undermined the effective presentation of the defence case, a verdict reached in the absence of the material evidence (and the use that the defence might have made of it) cannot stand. Such was the case in Grey88. Application of the principles: When the foregoing principles are applied to the present appeal, there can be but one conclusion. There were many curious features of this case at trial. The possibility that the appellant is innocent cannot be excluded. There is exculpating evidence. Some of it was simply not revealed to the defence. Some of it was actually suppressed so as to deprive the defence of material by which to test the accuracy of the evidence of obviously truthful witnesses and to impugn the credibility of others (particularly police) whose credibility was challenged and where the resolution of that challenge was significant for the acceptance or rejection by the jury of the unrecorded and unconfirmed "confessions". These "confessions" had their own peculiarities. 84 Relevantly because of the terms of the Code, s 689(1). 85 Stinchcombe [1991] 3 SCR 326 at 333; cf Berger 295 US 78 at 88 (1935). 86 Kyles 514 US 419 at 434 (1995). 87 (1979) 142 CLR 659. 88 (2001) 75 ALJR 1708; 184 ALR 593. Kirby Subjecting them to rigorous examination and scrutiny at the trial was essential to the fair trial of the appellant. The very number, variety and significance of the material evidence that was not disclosed to the defence in these proceedings, without more, presents, potentially, an important body of testimony upon which counsel representing the appellant could suggest a failure by the prosecution to afford him a fair trial. In particular, the non-disclosure and suppression of evidence that presented contradictory (or at least highly inconvenient and troubling) testimony from getting before the jury could be viewed, of itself, as casting doubt on the reliability of the "confessions" that were an important foundation of the prosecution case. I have described the requirements governing prosecution disclosure laid down by many courts for a purpose. Despite the distinct legal rules of different jurisdictions, there is a high measure of consistency in the emerging principles. This is hardly surprising given the links of history and the contemporary stimulus of universal notions of fundamental rights both for the expression of the common law and the elucidation of Guidelines founded in statute or other written law. There is nothing inconsistent with these principles in this Court's earlier doctrine. To the contrary, Australian law gives effect to them. A reflection upon the consistency with which the principles are expressed and applied in the foregoing cases in courts of high authority confirms a conclusion that, in the present case, especially when viewed in combination, the many instances of prosecution non-disclosure and of the suppression of material evidence results in a conclusion that the appellant's trial cannot enjoy public confidence89. This is another way of saying, in terms of the Code, that the jury's verdict is unreasonable or unsupportable in the light of the "whole case", as it is now known. Conclusion: a miscarriage of justice: It follows that there has been a miscarriage of justice in this case. It is impossible to conclude that the errors which occurred in the appellant's trial can be described as insubstantial so as to warrant dismissal of the appeal under the proviso. The appeal must be allowed. The disposition and orders Submission for acquittal: The appellant strongly argued that he was entitled to an order of acquittal. By reference to the defects in the conduct of his 89 This amounts to the Court's saying, on its own authority, that the trial did not meet the standards set by law: cf Silbert v Director of Public Prosecutions (WA) (2004) 217 CLR 181 at 191 [26]. Kirby trial, the suggested errors in the suppression of material evidence, the substantial material relevant to his mental infirmity said to explain the peculiarities of his "confessions", the prolonged period he has already served in prison and the burden of a retrial on him, on witnesses and on the community, the appellant asked this Court to bring his incarceration to a close with an order of acquittal. In Dyers v The Queen90, I collected considerations that this Court has viewed in the past as relevant, where a conviction is quashed, to adding the usual order for a new trial and, exceptionally, to omitting that course91. As I acknowledged there, retrial is the normal order in such circumstances. This leaves it to the prosecution, within the Executive Government, to take into account all relevant considerations and to ensure consistency in the treatment of like cases in ordering a retrial92. In Dyers, I concluded that no new trial should be ordered in the special circumstances of that case. However, all other members of the Court joined in making the usual order. That is the order that should be made here, but in the terms, and for the reasons, expressed in the joint reasons93. A new trial order: There remain curiosities in the evidence of the appellant in the first trial. There are issues of conflicting evidence that an appellate court cannot satisfactorily resolve. Whether, in all the circumstances, a retrial should be had, is a question properly left to the Director of Public Prosecutions. The matters disclosed in this appeal will doubtless be of assistance to him in making his decision. I agree in the orders proposed in the joint reasons. 90 (2002) 210 CLR 285. 91 (2002) 210 CLR 285 at 314-316 [82]-[85]. 92 (2002) 210 CLR 285 at 316 [85]. 93 Joint reasons at [43].
HIGH COURT OF AUSTRALIA Matter No S79/2003 BAYSIDE CITY COUNCIL & ORS APPELLANTS AND TELSTRA CORPORATION LIMITED & ORS RESPONDENTS Matter No S80/2003 MORELAND CITY COUNCIL APPELLANT AND OPTUS VISION PTY LIMITED & ORS RESPONDENTS Matter No S83/2003 WARRINGAH COUNCIL & ORS APPELLANTS AND OPTUS VISION PTY LIMITED & ORS RESPONDENTS Matter No S84/2003 HURSTVILLE CITY COUNCIL & ORS APPELLANTS AND TELSTRA CORPORATION LIMITED & ORS RESPONDENTS Bayside City Council v Telstra Corporation Limited [2004] HCA 19 28 April 2004 S79/2003, S80/2003, S83/2003 and S84/2003 ORDER In each matter: Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation: Matter No S79/2003 N J Young QC with M N Connock for the appellants (instructed by Maddocks) P J Hanks QC with J M Jagot for the first and second respondents (instructed by Mallesons Stephen Jaques) F M Douglas QC with G R Kennett and K M Connor for the third to thirteenth respondents (instructed by Deacons) Matter No S80/2003 N J Young QC with M N Connock for the appellants (instructed by Maddocks) D F Jackson QC with N Perram for the first and second respondents (instructed by Gilbert & Tobin) F M Douglas QC with G R Kennett and K M Connor for the third to fifth respondents (instructed by Deacons) Matter No S83/2003 F M Douglas QC with G R Kennett and K M Connor for the appellants (instructed by Deacons) D F Jackson QC with N Perram for the first and second respondents (instructed by Gilbert & Tobin) N J Young QC with M N Connock for the third respondent (instructed by Maddocks) Matter No S84/2003 F M Douglas QC with G R Kennett and K M Connor for the appellants (instructed by Deacons) P J Hanks QC with J M Jagot for the first and second respondents (instructed by N J Young QC with M N Connock for the third to sixth respondents (instructed by Maddocks) Interveners H C Burmester QC with M A Perry intervening on behalf of the Attorney- General of the Commonwealth (instructed by Australian Government Solicitor) P A Keane QC, Solicitor-General of the State of Queensland, with G R Cooper intervening on behalf of the Attorney-General of the State of Queensland (instructed Crown Law (Queensland)) R J Meadows QC, Solicitor-General for the State of Western Australia, with R M Mitchell intervening on behalf of the Attorney-General for the State of Western Australia (instructed by Crown Solicitor (Western Australia)) P M Tate SC, Solicitor-General for the State of Victoria, with K L Emerton intervening on behalf of the Attorney-General for the State of Victoria (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Bayside City Council v Telstra Corporation Limited Local government – Council – Rates and charges – Respondent corporations were carriers licensed under the Telecommunications Act 1997 (Cth) – Respondent carriers installed underground and aerial coaxial cabling in local government areas under the responsibility of the various local authorities – Local authorities in New South Wales resolved to make charges pursuant to Local Government Act 1993 (NSW), s 611 in respect of respondents' underground and aerial cabling – Local authorities in Victoria declared and levied rates on land occupied by respondents' cables pursuant to Local Government Act 1989 (Vic), Pt 8 – Statutory provisions provided exemptions from relevant charges or rates in respect of other owners or occupiers of public land – Whether State laws imposing such rates and charges discriminated against respondent carriers within meaning of Telecommunications Act 1997 (Cth), Sched 3, cl 44, and were therefore invalid under the Constitution, s Constitutional Law (Cth) – Powers of the Parliament – Whether provision conferring upon respondent carriers an immunity from discriminatory burdens imposed upon them in their capacity as carriers by State or Territory laws is a law with respect to postal, telegraphic, telephonic and other like services – Constitution, s 51(v) – Inconsistency between Commonwealth and State laws – Constitution, s 109 – Whether immunity conferred by a federal law, having regard to its substance and operation, in a significant manner curtailed or interfered with the capacity of States to function as governments. Constitution, ss 51(v), 109. Telecommunications Act 1997 (Cth), Sched 3, cl 44. Local Government Act 1993 (NSW), s 611. Local Government Act 1989 (Vic), Pt 8. GLEESON CJ, GUMMOW, KIRBY, HAYNE AND HEYDON JJ. These appeals are brought by a number of New South Wales and Victorian local authorities against a decision of the Full Court of the Federal Court of Australia1 which declared invalid certain legislation of those States to the extent to which the legislation authorised local authorities to impose charges in respect of the possession, occupation and enjoyment of telecommunications cables on, under, or over a public place, or to levy rates in respect of land or space occupied by such cables. The respondent corporations, referred to in the Federal Court collectively as the Telstra parties and the Optus parties, or simply Telstra and Optus, are carriers under the Telecommunications Act 1997 (Cth) ("the Telco Act"). (Some of the local authorities that were parties to the original proceedings have also been joined as respondents.) Telstra and Optus each commenced separate proceedings in the Federal Court challenging, on a number of grounds, the lawfulness of charges and respect of telecommunications cables by local authorities including the present appellants. All grounds of challenge failed at first instance before Wilcox J2. Most are not in issue in this Court. The Full Court (Sundberg and Finkelstein JJ) reversed the decision of Wilcox J, upholding an argument of Telstra and Optus that the State legislation under which the rates and charges were levied and imposed was, to the extent to which such legislation authorised the rates and charges, inconsistent with a provision of the Telco Act, and invalid pursuant to s 109 of the Constitution3. The outcome of these appeals turns upon that argument. imposed or levied rates The broadband cable networks In his reasons, Wilcox J said that part of the background to this litigation involved "community concern at the extent of the broadband cabling that was aerially erected in many parts of Australia during the mid-1990s"4, and the response of local government authorities. In about 1995, Telstra and Optus 1 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198. 2 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322. 3 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198. The third judge of the Full Court became unable to continue as a member of the Court and later resigned. (2000) 105 FCR 322 at 329 [2]. Kirby Hayne commenced installing and laying broadband cable networks in the Sydney and Melbourne metropolitan areas. A broadband cable network uses a wider frequency band than is necessary to transfer speech telephonically. It comprises links between exchanges, between exchanges and a customer's tap-off point, and between a customer's tap-off point and equipment at a customer's premises. It permits a flow of information for a number of purposes, including internet services and cable television. The principal functions of the Telstra broadband network are to provide pay television, high-speed internet access, and telephony services5. By a chain of legislative title identified in Telstra Corporation Ltd v Worthing6, Telstra is the successor to the Australian Telecommunications Commission which was continued as a body corporate under the name "Telecom"; this body ("Telecom") had a monopoly as a telephone carrier. Telecom's telephony system originally used extensive aerial cabling, but this was progressively placed underground7. Telstra's cable network was designed to make use of existing infrastructure, including underground ducts and existing electricity poles. The coaxial cable component of the network is reticulated either underground or aerially. In the case of aerial reticulation, existing poles are used. In the case of underground reticulation, existing underground pipes and ducts/conduits are used. In metropolitan Sydney and Melbourne, approximately one quarter of Telstra's coaxial cables are reticulated aerially, and approximately three quarters are reticulated underground. Aerial cables are secured to poles, which typically also carry electricity conductors and cables. Underground cables may be reticulated along with other services such as water, gas, electricity and sewerage8. later The Optus network comprises mainly aerial coaxial cables. Between April/May 1995 and March 1997, Optus laid cables and installed other structures on, under and over land of the appellants. As at 1 July 1997, the Optus network provided a local telephone service, some pay television, and high-speed data products. During the year ended 30 June 1998, Optus used its network to provide pay television to residential subscribers in each appellant's area. (2000) 105 FCR 322 at 335 [22]. (1999) 197 CLR 61 at 71 [9]. (2000) 105 FCR 322 at 337 [31]. (2000) 105 FCR 322 at 335 [18]-[20]. Kirby Hayne The Full Court pointed out that, since Federation, telecommunications services have been provided either by the government (the Postmaster-General), or a statutory corporation (such as Telecom), or by a public company (such as Optus), including a company in which the Commonwealth holds a majority of shares (Telstra)9. It has always been necessary for the Parliament to confer powers to install and operate facilities. The present federal regulatory regime confers such powers, but extends beyond that. It is convenient to turn to the principal features of that regime. The federal legislation In the exercise of its powers, including the power, conferred by s 51(v) of the Constitution, to make laws with respect to postal, telegraphic, telephonic, and other like services, the Parliament, in the Telco Act, provided a regulatory framework which was intended to promote the development of an efficient and competitive telecommunications industry, including the supply of carriage services to the public, and to ensure that such services are reasonably accessible, and are supplied efficiently and economically to meet the social and business needs of the Australian community (s 3). "Carriage service" is defined to mean a service for carrying communications by means of guided and/or unguided electromagnetic energy (s 7). Part 2 of the Telco Act deals with network units, which include links of the kind owned by Telstra and Optus. An owner of network units wishing to supply a carriage service to the public must hold a carrier licence (s 42). Such a licence entitles the carrier to use a network unit to supply carriage services to the public. It is subject to specified conditions, including compliance with the Telco Act, and with other conditions declared by the Minister (s 63). As s 3 of the Telco Act states, the regulatory framework is contained, not only in the Telco Act, but also in Pts XIB and XIC of the Trade Practices Act 1974 (Cth), which are to be read together with the Telco Act. Part XIB sets up what is described in s 151AA (the simplified outline) as a special regime for regulating anti-competitive conduct in the telecommunications industry. A carrier or carriage service provider must not engage in anti-competitive conduct. That "competition rule" is subject to the supervisory power of the Australian Competition and Consumer Commission ("the Commission"), which may make orders exempting specified conduct from the scope of the definition of anti- competitive conduct, direct carriers and carriage service providers to file tariff (2002) 118 FCR 198 at 208 [21]. Kirby Hayne information, make record-keeping rules for carriers and carriage service providers, and direct carriers and carriage service providers to make certain reports available for inspection. The object of Pt XIC is to promote the long- term interests of end-users of carriage services or of services provided by means of carriage services (s 152AB). As explained in the simplified outline (s 152AA), the Part sets out a "telecommunications access regime". The Commission may declare carriage services and related services to be declared services. Providers of declared services are required to comply with standard access obligations, which facilitate the provision of access to declared services by service providers in order that service providers can provide carriage services and/or content services. Provision is made for the terms and conditions of such access, and for dispute resolution by the Commission where necessary. The simplified outline of the Telco Act (s 5) refers to the obligations of carriage service providers and content service providers to comply with service provider rules. The Australian Communications Authority monitors, and reports to the Minister on the performance of, service providers. The legislation provides both for voluntary industry codes, and for mandatory industry standards. There is established what is called a universal service regime with the object of ensuring that all people in Australia, wherever they reside or carry on business, should have reasonable access, on an equitable basis, to standard telephone services, payphones and prescribed carriage services. Provision is made for regulating call charges and various aspects of the services provided pursuant to the legislation, and for standard agreements for the supply of carriage services. The predecessor of the Telco Act was the Telecommunications Act 1991 (Cth). That Act made provision for the licensing of carriers, and their obligations, rights and immunities. Section 116 of the 1991 Act provided for regulations exempting activities from State and Territory laws. The regulations specified activities including the construction, maintenance and repair of facilities, being part of a carrier's telecommunications network. A carrier was permitted to engage in an exempt activity despite a law of a State or Territory about the powers and functions of a local government body or the use of land. The cables the subject of the rates and charges challenged in this litigation were installed during the period of operation of the 1991 Act, and pursuant to authorities and exemptions conferred by or under that Act10. 10 (2000) 105 FCR 322 at 352 [92]. Kirby Hayne Provisions dealing with the application of State laws to the conduct of service providers carrying on activities authorised by the Commonwealth pursuant to s 51(v) are familiar. In R v Brislan; Ex parte Williams11, Latham CJ said: "It is a question of policy whether there should be any and what legislation upon such subjects as communication services. A telephone service may be provided by a private person or by an ordinary public company, or by a public company or other corporation operating under a franchise or other special power, or by a Government department. The necessity for acquiring rights to erect poles and to place conduits in public highways has in practice made it necessary for the Legislature to confer special powers upon a company or specially created body or upon a Government department ... It appears to me to be impossible to attach any definite meaning to sec 51(v) short of that which gives full and complete power to Parliament to provide or to abstain from providing the services mentioned, to provide them upon such conditions of licences and payment as it thinks proper, or to permit other people to provide them, subject or not subject to conditions, or to prohibit the provision of such facilities altogether." To return to the Telco Act, Pt 24, headed "Carriers' powers and immunities" consists of a single, proleptic, provision: "484. Schedule 3 has effect." Schedule 3 occupies 57 pages of the current print of the Telco Act. The simplified outline of the general provisions contains the following summary of the Part. A carrier may enter on land and install and maintain a facility on the land. "Installation" is defined to include activities ancillary or incidental to installation (Sched 3 cl 2), and would embrace occupation of land by facilities. The power of installation is limited to certain kinds of facility, and its exercise requires a permit. The circumstances in which permits will be issued are defined. A carrier exercising these powers must comply with certain conditions. One condition is that a carrier must take all reasonable steps to ensure that it causes as little detriment and inconvenience as is practicable. Only a carrier may install (Sched 3 cl 6) or enter land to maintain (Sched 3 cl 7) a facility. Division 7 of Pt 1 of the Schedule is headed "Exemptions from State and Territory laws". It provides (cl 36) that activities of carriers are not generally exempt from State and 11 (1935) 54 CLR 262 at 276-277. Kirby Hayne Territory laws, but cl 37 goes on to provide that activities authorised by Div 2, 3 or 4 may be carried on despite certain laws of a State or Territory, including environmental, heritage, and other specified kinds of law12. Clauses 38 and 39 are as follows: It is the intention of the Parliament that, if clause 37 entitles a carrier to engage in activities despite particular laws of a State or Territory, nothing in this Division is to affect the operation of any other law of a State or Territory, so far as that other law is capable of operating concurrently with this Act. This Division does not affect the liability of a carrier to taxation under a law of a State or Territory." In Div 8 of Pt 1 of the Schedule there appears cl 44, which is central to the present appeals. It is in the following terms: The following provisions have effect: effect a law of a State or Territory has no effect to the extent to which the law discriminates, or would have the indirect) of (whether direct or discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally; (b) without limiting paragraph (a), a person is not entitled to a right, privilege, immunity or benefit, and must not exercise a power, under a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally; Clause 42 provides for the recovery of compensation by persons suffering financial loss or damage because of anything done by a carrier under Div 2, 3 or 4 in relation to any property owned by such persons or in which they have an interest. There is no question in these appeals respecting the operation of cl 42. Kirby Hayne (c) without limiting paragraph (a), a person is not required to comply with a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally. The following provisions have effect: effect a law of a State or Territory has no effect to the extent to which the law discriminates, or would have the indirect) of (whether direct or discriminating, against a particular eligible user, against a particular class of eligible users, or against eligible users generally; (b) without limiting paragraph (a), a person is not entitled to a right, privilege, immunity or benefit, and must not exercise a power, under a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular eligible user, against a particular class of eligible users, or against eligible users generally; (c) without limiting paragraph (a), a person is not required to comply with a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular eligible user, against a particular class of eligible users, or against eligible users generally. For the purposes of this clause, if a carriage service is, or is proposed to be, supplied to a person by means of a controlled network, or a controlled facility, of a carrier, the person is an eligible user. The Minister may, by written instrument, exempt a specified law of a State or Territory from subclause (1). Kirby Hayne The Minister may, by written instrument, exempt a specified law of a State or Territory from subclause (2). (6) An exemption under subclause (4) or (5) may be unconditional or subject to such conditions (if any) as are specified in the exemption. (7) An instrument under subclause (4) or (5) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901." The State legislation The Local Government Act 1993 (NSW) contained13 the following provision: "611. (1) A council may make an annual charge on the person for the time being in possession, occupation or enjoyment of a rail, pipe, wire, pole, cable, tunnel or structure laid, erected, suspended, constructed or placed on, under or over a public place. The annual charge may be made, levied and recovered in accordance with this Act as if it were a rate but is not to be regarded as a rate for the purposes of calculating a council's general income under Part 2. The annual charge is to be based on the nature and extent of the benefit enjoyed by the person concerned. If a person is aggrieved by the amount of the annual charge, the person may appeal to the Land and Environment Court and that Court may determine the amount. (5) A person dissatisfied with the decision of the Court as being erroneous in law may appeal to the Supreme Court in the manner provided the Land and Environment Court. for appeals from 13 There were inconsequential amendments in 1998 and 2000. Kirby Hayne This section does not apply to: the Crown, or the Sydney Water Corporation Limited, the Hunter Water Corporation Limited or a water supply authority, or Rail Access Corporation, or the owner or operator of a light rail system (within the meaning of the Transport Administration Act 1988), but only the development or operation of that system and is not excluded by the regulations from the exemption conferred by this paragraph." the matter relates The exemptions contained in s 611(6) are not exhaustive. Other legislation exempts other utilities from the charges authorised by s 611. In particular, s 50 of the Electricity Supply Act 1995 (NSW) exempts electricity network operators and s 40 of the Pipelines Act 1967 (NSW) exempts licensed operators of a pipeline. On the other hand, at the relevant times, gas suppliers were not exempt. The Local Government Act 1989 (Vic), in Pt 8, provides that, subject to certain exceptions, all land is rateable. The exceptions include land that is owned by the Crown and used exclusively for public or municipal services (which, as the Full Court said, includes water distribution to households and other premises and road structures such as signs, lights and signals)14. Section 46(1A) of the Electricity Industry Act 1993 (Vic) provides: "Despite anything to the contrary in the Local Government Act 1989, land is not occupied land for the purposes of that Act merely because any pole, wire or cable of a distribution company, transmission company or generation company is on, under or over that land." Section 52(2) of the Gas Industry Act 1994 (Vic) provides a similar exemption for retail gas suppliers. 14 (2002) 118 FCR 198 at 206 [15]. Kirby Hayne The Local Government Act empowers a council to declare rates on rateable land. The owner, or if the owner cannot be found, the occupier, is liable to pay the rates. The resolutions of the local authorities The New South Wales local authorities involved in these appeals resolved to make charges, pursuant to s 611 of the New South Wales Local Government Act, for the years ending 30 June 1998 and 30 June 1999. The charges were imposed in respect of "cabling" or "cables". Wilcox J summarised the effect of the resolutions15: "Sometimes the resolution was limited to cabling over (or under) 'Council property'; which includes public streets and reserves. Sometimes the charge applied to both overhead and underground cabling; sometimes only the former. Sometimes the charge was higher for overhead cabling than for underground cabling; for example, several councils charged $1000 per km for overhead cabling and $500 per km for underground cabling." For the years ending 30 June 1998 and 30 June 1999, the Victorian local authorities the Victorian Local these appeals, pursuant Government Act, declared and levied rates on the land occupied by Telstra and Optus cables. involved Reference has been made earlier to statutory exemptions from charges and rates. No charges under s 611 were made by the New South Wales local authorities in relation to structures for the transmission of electricity, or the conveyance of water; rail structures; traffic lights, signs, and signal boxes, bridges and tunnels (road structures); post boxes; and elevated public walkways, bus shelters, signs, awnings and flags, real estate advertising, other advertising signs, or waste and recycling receptacles, on public places within their respective areas. On the other hand, each local authority imposed charges under s 611 with respect to gas pipelines. As to the rates levied by the Victorian local authorities, other occupiers of the same land who were not liable to rates included occupiers for purposes of electricity distribution or transmission, or generation companies in respect of their poles, wires or cables, retail gas suppliers in respect of their pipes for conveyance of gas for sale by retail, water distribution entities in respect of pipes and valves for the distribution of water, and public transport and road traffic authorities in respect of signs, wires, signals, cabinets and other structures. 15 (2000) 105 FCR 322 at 338 [32]. Kirby Hayne Telstra and Optus contend that what is involved is discrimination against carriers within the meaning of cl 44 of the Telco Act. Clause 44 The appellants contest the constitutional validity of cl 44. In order to resolve that issue, it is necessary first to consider the scope of the provision in order to determine its operation and effect, for the purpose of relating that to a subject matter in respect of which the Parliament has legislative power16. There is a question as to the extent of the application of cl 44, and, in particular, cl 44(1)(a). That question is to be resolved primarily by reference to the legislative context in which the clause appears. The general context is that of a Federal regulatory framework for the telecommunications industry, including the supply of carriage services. The more specific context, contained in Pt 24 of the Telco Act, concerns what the heading to the Part refers to as the powers and immunities conferred upon carriers. In that respect, Div 7 of Pt 1 of Sched 3 deals with the extent to which activities of carriers are exempt from State and Territory laws of general application. The terms of cll 36, 37, 38 and 39 are set out above. Subject to certain exceptions, Divs 2, 3 and 4 of Pt 1 of Sched 3 do not authorise an activity if it is inconsistent with State law. Clause 37 is one exception, and cl 44 is another. Clause 39 deals with general State taxes. Clause 44 addresses a more particular issue. In accordance with settled principles of construction, when a law of a State or Territory is of a kind dealt with in the particular provision, then cl 44 prevails over the general provision. "The rule is, that wherever there is a particular enactment and a general enactment in the same statute, and the latter, taken in its most comprehensive sense, would overrule the former, the particular enactment must be operative …"17. Clause 44 deals with the effect of special kinds of State or Territory laws, that is to say, discriminatory laws. It will be necessary later to address the question whether the New South Wales and Victorian laws presently in question are discriminatory within the meaning of cl 44(1)(a). For the present, it is sufficient to note that, if a State or Territory law is discriminatory in one of the ways referred to in cl 44, and that discrimination involves adverse treatment that Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 186 per Pretty v Solly (1859) 26 Beav 606 at 610 per Romilly MR [53 ER 1032 at 1034]. Kirby Hayne is differential by reference to an appropriate standard of comparison, it will attract the operation of that provision. Sub-cl (1) of cl 44 deals with discrimination, either against a particular carrier, or against a particular class of carriers, or against carriers generally. Sub-cl (2) deals with discrimination either against a particular eligible user of carriage services, or against a particular class of eligible users, or against eligible users generally. To the extent covered by sub-cl (2), cl 44 goes beyond the topic of powers and immunities of carriers, but that does not alter materially the context as described in the heading to Pt 24. A particular eligible user of carriage services might have a number of other capacities as well. Plainly, it is discrimination against such a person or corporation in the capacity of a user of carriage services, as distinct from discrimination in some other capacity, that attracts the potential operation of cl 44. Similarly, having regard both to the general and to the more specific context of the legislation, the kind of discrimination against carriers that attracts the potential operation of cl 44 is discrimination against them in their capacity as carriers. Clause 44 is concerned with State or Territory laws which impose discriminatory burdens upon carriers in carrying on activities as carriers authorised by the Telco Act. Telstra and Optus are public companies although, in the case of Telstra, at the relevant times a majority of the shares was held by the Commonwealth. In that respect, the case is different from Australian Coastal Shipping Commission v O'Reilly18. It will be necessary to return to what was said there about s 109 of the Constitution19. What is of immediate relevance, however, is that, in O'Reilly, the test applied in determining the validity of the law of the Commonwealth conferring a general exemption from State taxes upon the Commission established in exercise of the trade and commerce power was the relevance of that law to, or its connection with, the head of power exercised in establishing the Commission20. The power conferred by s 51(v) of the Constitution, to make laws with respect to postal, telegraphic, telephonic and other like services, includes a power to make laws with respect to telecommunications services. So far as presently relevant, it extends to making laws regulating the terms and conditions upon 18 (1962) 107 CLR 46. 19 (1962) 107 CLR 46 at 56-57 per Dixon CJ. 20 (1962) 107 CLR 46 at 55-56 per Dixon CJ. Kirby Hayne which such services may be provided, the licensing of carriers, their conduct as licensees, and the conferring upon them of powers and immunities in connection with the activities undertaken by them pursuant to the chosen regulatory framework. The federal object of promoting the development of the telecommunications industry, and ensuring that telecommunications services would be provided to meet the needs of the Australian community, falls within a head of the legislative power of the Parliament of the Commonwealth. Conferring upon carriers an immunity from discriminatory burdens imposed upon them by State or Territory laws in their capacity as carriers has a direct and substantial connection with the power. It is not to the point to say that cl 44 is also a law with respect to discrimination. A law may bear more than one character, but that does not make it possible to ignore the character (if there be one) of constitutional relevance. The law protecting trading corporations from boycotts, held to be valid in Actors and Announcers Equity Association v Fontana Films Pty Ltd21, was a law with respect to boycotts, as well as a law with respect to trading corporations. As Stephen J pointed out in that case22, and after contrasting the situation in Canada, the pattern of distribution of legislative power in Australia is not based on a concept of mutual exclusiveness, and it is inappropriate to seek one sole or dominant character in every law. A law may possess a number of characters. He said23: "Once it is recognized that a law may possess several distinct characters, it follows that the fact that only some elements in the description of a law fall within one or more of the grants of power in s 51 or elsewhere in the Constitution will be in no way fatal to its validity. So long as the remaining elements, which do not fall within any such grant of power, are not of such significance that the law cannot fairly be described as one with respect to one or more of such grants of power then, however else it may also be described, the law will be valid. If a law enacted by the federal legislature can be fairly described both as a law with respect to a grant of power to it and as a law with respect to a matter or matters left 21 (1982) 150 CLR 169. 22 (1982) 150 CLR 169 at 191. 23 (1982) 150 CLR 169 at 192. Kirby Hayne to the States, that will suffice to support its validity as a law of the Commonwealth." The general principles which are to be applied to determine whether a law is "with respect to" a head of legislative power are well settled and have been considered on many occasions, including recently24. One principle that commands universal concurrence is that stated by Mason and Deane JJ in Re F; Ex parte F25: "In a case where a law fairly answers the description of being a law with respect to two subject-matters, one of which is and the other of which is not a subject-matter appearing in s 51, it will be valid notwithstanding that there is no independent connexion between the two subject-matters." Melbourne Corporation doctrine It was argued for the appellants that cl 44 is an attempt to dictate the content of State law and offends the principle enunciated in Melbourne Corporation v The Commonwealth26. A similar submission troubled Wilcox J, who considered that cl 44 "has a propensity to disturb the federal/State balance by influencing the manner in which a State legislates in respect of a subject within its own legislative domain."27 Whatever the balance struck by the Constitution, it must give effect to ss 51(v) and 109. Clause 44 is no less a law with respect to services of the kind described in s 51(v) by reason of the fact that the immunity it confers, or attempts to confer, covers only discriminatory State laws. A law conferring upon carriers an immunity from all State taxes and charges would be a law with respect to telecommunications services; and so is a law conferring an immunity from some State taxes and charges. It does not make a difference that the chosen discrimen requires not only examination of the content of the State law but also comparison with the operation of other State 24 Leask v The Commonwealth (1996) 187 CLR 579; Grain Pool of WA v The Commonwealth (2000) 202 CLR 479 at 492 [16]. 25 (1986) 161 CLR 376 at 388. 26 (1947) 74 CLR 31. 27 (2000) 105 FCR 322 at 372 [187]. Kirby Hayne laws. The clause does not affect the capacity of the States to function as governments. Their legislative capacity remains unimpaired, except to the extent to which otherwise s 109 provides. That is a matter to be considered below. There is, in cl 44, no more an attempt to dictate the content of State revenue laws than there was, in Botany Municipal Council v Federal Airports Corporation28, an attempt to dictate the content of State environmental laws. The Melbourne Corporation doctrine presents an inquiry whether the federal law in question, looking to its substance and operation, in a significant manner curtails or interferes with the capacity of the States to function as governments29. In Re Lee; Ex parte Harper30, in a passage later approved by six Justices in the Native Title Act Case31, Mason, Brennan and Deane JJ emphasised that, although the purpose of the doctrine32: "is to impose some limit on the exercise of Commonwealth power in the interest of preserving the existence of the States as constituent elements in the federation, the implied limitations must be read subject to the express provisions of the Constitution. Where a head of Commonwealth power, on its true construction, authorizes legislation the effect of which is to interfere with the exercise by the States of their powers to regulate a particular subject-matter, there can be no room for the application of the implied limitations." The States are left by the relevant federal law in cl 44 free to exercise their legislative powers to impose liability to taxation, as cl 39 envisages. All that is forbidden by cl 44 is the imposition of a State law which discriminates against a carrier or person or corporation in the nominated categories. The enactment by federal law of this prohibition is within the ambit of the legislative powers of the Parliament. The prohibition is designed to ensure the effectiveness of the law 28 (1992) 175 CLR 453. 29 Austin v The Commonwealth (2003) 77 ALJR 491 at 501 [27], 527 [168], 547 [275]; 195 ALR 321 at 333, 370, 397. 30 (1986) 160 CLR 430. 31 Western Australia v The Commonwealth (1995) 183 CLR 373 at 477. 32 (1986) 160 CLR 430 at 453. Kirby Hayne with respect to carriers and others which is enacted under those powers and attracts the operation of s 109 of the Constitution. Thus, there remains applicable the primary proposition stated by Dixon J in Melbourne Corporation33: "The prima-facie rule is that a power to legislate with respect to a given subject enables the Parliament to make laws which, upon that subject, affect the operations of the States and their agencies. That, as I have pointed out more than once, is the effect of the Engineers' Case34 stripped of embellishment and reduced to the form of a legal proposition." Constitution, s 109 Telstra and Optus contend that, if and to the extent to which the provisions of the Local Government Acts of New South Wales and Victoria, pursuant to which the charges and rates in question were imposed or levied, fall within the description of laws which discriminate, or would have the effect (whether direct or indirect) of discriminating, against carriers generally, then they are inconsistent with the Telco Act and invalid. In The Commonwealth v State of Queensland35, this Court held that a provision in the Commonwealth Inscribed Stock Act 1911 (Cth) that "interest derived from stock or Treasury bonds shall not be liable to income tax under any law of the Commonwealth or a State" unless a certain condition was satisfied was a law supported by the power in s 51(iv) of the Constitution to make laws with respect to "[b]orrowing money on the public credit of the Commonwealth", and interest derived from declared that Queensland Commonwealth stock or Treasury bonds liable to State income tax was to that extent invalid. That decision was referred to by Dixon CJ, in Australian Coastal Shipping Commission v O'Reilly36, as the first in a line of cases in which "[t]he argument that under a legislative power of the Commonwealth the operation of legislation which made 33 (1947) 74 CLR 31 at 78. 34 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 35 (1920) 29 CLR 1. 36 (1962) 107 CLR 46 at 56. Kirby Hayne State laws cannot be directly and expressly excluded has been used without effect". The appellant in O'Reilly was established as a body corporate by the Australian Coastal Shipping Commission Act 1956 (Cth) which also provided that the Commission was not subject to taxation under State laws to which the Commonwealth itself was not subject. The Commonwealth law was held to be a law relevant to, and falling within, the power conferred by ss 51(i) and 98 of the Constitution. It prevailed over a law of the State of Victoria requiring payment of stamp duty on receipts given by the Commission in the course of its trading activities. Similarly, in Botany Municipal Council v Federal Airports Corporation37 a Federal regulation which authorised licensed contractors to carry out works at the Sydney Airport in spite of a law of the State of New South Wales relating to environmental assessment was held to be effective to exclude the operation of State environmental legislation. In a joint judgment of all members of the Court it was said38: "There can be no objection to a Commonwealth law on a subject which falls within a head of Commonwealth legislative power providing that a person is authorized to undertake an activity despite a State law prohibiting, restricting, qualifying or regulating that activity. Indeed, unless the law expresses itself directly in that way, there is the possibility that it may not be understood as manifesting an intention to occupy the relevant field to the exclusion of State law." The argument for the appellants invoked the idea, expressed by Evatt J in West v Commissioner of Taxation (NSW)39, that attempts by the Parliament of the Commonwealth to manufacture inconsistency between its own legislation and that of the States could result in a law of the Commonwealth which is itself ultra vires. A description of inconsistency as "manufactured" may beg the question. In Wenn v Attorney-General (Vict)40, Dixon J said: "There is no doubt great difficulty in satisfactorily defining the limits of the power to legislate upon a subject exhaustively so that s 109 will of its own force make inoperative State legislation which otherwise 37 (1992) 175 CLR 453. 38 (1992) 175 CLR 453 at 465. 39 (1937) 56 CLR 657 at 707. 40 (1948) 77 CLR 84 at 120. Kirby Hayne would add liabilities, duties, immunities, liberties, powers or rights to those which the Federal law had decided to be sufficient. But within such limits an enactment does not seem to me to be open to the objection that it is not legislation with respect to the Federal subject matter but with respect to the exercise of State legislative powers or that it trenches upon State functions. Beyond those limits no doubt there lies a debatable area where Federal laws may be found that seem to be aimed rather at preventing State legislative action than dealing with a subject matter assigned to the Commonwealth Parliament." It is inconsistency between a valid law of the Commonwealth and a law of a State that is involved, and, to be valid, the federal law must be a law with respect to a subject of federal legislative power. This case does not enter upon what Dixon J in Wenn41 described as "a debatable area" in the law of the Constitution and so does not require consideration of the existence of such an area. The concern indicated by Dixon J appears to arise where a law on its face made in exercise of a head of concurrent legislative power in s 51 of the Constitution is "aimed at" preventing the exercise of State legislative power and accordingly is not "a law of the Commonwealth" for the purposes of s 109 of the Constitution and cannot prevail over legislation of a State passed in exercise of its concurrent power. It appeared to Wilcox J that, in the application of s 109, there is a material difference between a Federal law which provides, for example, that a carrier shall not be liable to any State tax, and a law which provides that a carrier shall not be liable to any discriminatory State tax42. If the difference is thought to be that a law of the second kind is a law with respect to discrimination and not a law within s 51(v), then the answer to that is given above. Beyond that, the difference is elusive. If protecting carriers against the imposition of burdens, such as taxation, by State law has a sufficient connection with the power confined by s 51(v), then it is difficult to understand why protecting carriers against discriminatory burdens does not have the same connection with the power. Nor does such a limited protection become a bare attempt to exclude State power upon a subject as to which the Parliament has not chosen to legislate exhaustively. 41 (1948) 77 CLR 84 at 120. 42 (2000) 105 FCR 322 at 370-374 [179]-[198]. Kirby Hayne In cl 39, the Parliament declared an intention not to protect carriers from State taxes of general application, but the scheme of powers and immunities created by Sched 3, which was to govern the operations of the carriers, was to include (by virtue of cl 44) a protection from discriminatory State taxes and charges. The reasons of policy underlying the distinction are a matter for the legislature, although the responses of local authorities to what Wilcox J described as community concern at the cabling may indicate some of the policy considerations at work. The legislative history shows that an attempt to impose discriminatory taxes or charges, perhaps in order to discourage cabling, or at least overhead cabling, or perhaps simply to raise revenue, was foreseen. As a matter of power, the narrower immunity is as easily sustained as a wider immunity. The enactment of a valid Federal law pursuant to the power engages s 109. Discrimination Discrimination is a concept that arises for consideration in a variety of constitutional and legislative contexts. It involves a comparison43, and, where a certain kind of differential treatment is put forward as the basis of a claim of discrimination, it may require an examination of the relevance, appropriateness, or permissibility of some distinction by reference to which such treatment occurs, or by reference to which it is sought to be explained or justified. In the selection of comparable cases, and in forming a view as to the relevance, appropriateness, or permissibility of a distinction, a judgment may be influenced strongly by the particular context in which the issue arises. Questions of degree may be involved. In the present case, the basis for the claim of discrimination is in a comparison between, on the one hand, the charges and rates imposed and levied in respect of the Telstra and Optus cables, and, on the other hand, the treatment of facilities, which are installed or operated above, on or under public land, by utilities or other users of such space and are said to be comparable. The exemptions from charges and rates generally applicable to those facilities (except gas pipelines in New South Wales) are referred to above. As Gibbs J pointed out in Victoria v The Commonwealth (The Payroll Tax Case)44, it is in the nature of taxing statutes that not all taxpayers are treated with absolute equality, and the fact that some taxpayers enjoy exemptions that are not available to others does 43 Street v Queensland Bar Association (1989) 168 CLR 461 at 506 per Brennan J. 44 (1971) 122 CLR 353 at 425-426. Kirby Hayne not necessarily involve discrimination. It may involve nothing more than differentiation based upon criteria within its constitutional power which it is well open to the legislature to regard as appropriate. In the present case, however, Telstra and Optus point to a general pattern of State legislative treatment of facilities to which their cables have been made an exception. Clause 44 does not, in terms, identify the kind of comparison that is appropriate for the purpose of considering whether a State law discriminates against carriers generally. (The comparison involved in deciding whether a State law discriminates against a particular carrier, or a particular class of carriers, is more straightforward.) There is extrinsic material capable of assisting in the ascertainment of the meaning of cl 4445. The Explanatory Memorandum said: "The clause is intended to deal with laws which have an indirect effect of discriminating against carriers or users of carrier services, not just a law which, for example, on its face treats a person differently to someone else. The indirect discrimination which this clause is intended to prevent includes the following examples: laws that impose a burden on facilities of a carrier that is not imposed on similar facilities (for example a tax on 'street furniture' which is in effect discriminatory against carriers because other bodies owning such equipment such as electricity authorities would be exempt from paying that tax); In relation to aerial cabling, which appears to be what primarily attracted the attention of the local authorities, the facilities installed by electricity authorities constitute an obvious basis of comparison. The fact that they are singled out in the Explanatory Memorandum confirms that the kind of discrimination with which cl 44 is concerned, in its reference to discrimination against carriers generally, is the subjection of carriers, in that capacity, to a burden of a kind to which others in a similar situation are generally not subject, and that a similar situation includes the use of public space for the installation and maintenance of facilities such as cables, pipes, ducts and conduits. In relation to underground facilities, the position is somewhat more complex, but gas pipelines in New South Wales are, apart from the facilities in question in this case, the exception to a general pattern of exemption. 45 Acts Interpretation Act 1901 (Cth), s 15AB. Kirby Hayne It is not necessary to resolve the question, raised by a submission of Telstra and Optus, whether it would be sufficient to constitute discrimination that there was even one substantial utility that received the benefit of exemptions denied to Telstra and Optus. Here there is a clear general pattern of exemptions, and it is sufficient to say that the existence of one other significant exception to that pattern (gas pipelines in New South Wales) does not negate discrimination. In addition, in the case of aerial cabling, there is an obvious basis of comparison, namely electricity facilities, which enjoy an exemption. The appellants point out that the exemptions are granted directly by State laws, whereas the charges and rates are imposed or levied by local authorities acting pursuant to State laws. They also point out that the differential treatment to which the telecommunications cables are subject is a consequence of the combined operation of the exemptions and the impositions or levies. Why, it is asked, does cl 44 prevail over the laws that authorise the charges and rates, rather than the laws that grant the exemptions? The charges and rates take legal effect by virtue of the State laws pursuant to which the resolutions of the local authorities were passed. Clause 44 refers to laws that discriminate, or have the effect of discriminating against carriers. Those are the laws that are of no effect. The laws that confer favourable treatment upon others are not declared by cl 44 to be ineffective. Their existence may give to the laws pursuant to which the charges and rates in issue are imposed or levied the character of being discriminatory, but they do not themselves discriminate, or have the effect of discriminating, against carriers under the Telco Act. It would be inconsistent with the scheme of the Telco Act, and the context of cl 44, to assert that, in its reference to discrimination, the Telco Act contemplated as a legitimate and appropriate basis of differential imposition of burdens the circumstance that carriers were authorised by a law of the Commonwealth, whereas other utilities or bodies owning or operating comparable facilities were authorised by State laws46. Nor is it possible to account for, or justify, the difference on the basis of a distinction between public ownership and private enterprise. cf Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 478 per Gaudron and McHugh JJ; Austin v Commonwealth (2003) 77 ALJR 491 at 517 [118]; 195 ALR 321 at 356 per Gaudron, Gummow and Hayne JJ. Kirby Hayne The Full Court was right to hold that Telstra and Optus have made out a case of discrimination within cl 44. Conclusion The appeals should be dismissed with costs. The result is that the following declaration made in each set of proceedings below by the Full Federal Court stands: The Court declares that each of section 611 of the Local Government Act 1993 (NSW), to the extent that it authorises the first to eleventh respondents to make, levy and recover from the appellants charges in respect of the possession, occupation and enjoyment of telecommunications cables erected or placed on, under or over a public place; and Part 8 of the Local Government Act 1989 (Vic), to the extent that it authorises the twelfth to fifteenth respondents to declare and recover from the appellants rates and charges on land occupied by telecommunications cables; the effect (whether direct or indirect) of discriminates or has discriminating against a carrier or carriers generally, within clause 44(1) of Schedule 3 to the Telecommunications Act 1997 (Cth), and is to that extent inconsistent with clause 44(1) and invalid pursuant to section 109 of the Constitution." McHugh 50 McHUGH J. These cases involve appeals against declarations made by the Full Court of the Federal Court of Australia47 concerning the validity of certain sections of the Local Government Act 1993 (NSW) and the Local Government Act 1989 (Vic). The Full Court declared that, to the extent that the sections empower local government councils to impose rates or charges on certain cables owned by telecommunications carriers, they discriminate against the carriers and are invalid under s 109 of the Constitution. The questions in the appeals are whether cl 44(1) of Sched 3 to the Telecommunications Act 1997 (Cth) is valid and, if so, whether the clause operates to invalidate Victorian and New South Wales provisions that impose charges or rates on licensed telecommunications carriers. In my opinion, cl 44(1) is valid and operates to invalidate the Victorian and New South Wales provisions that impose discriminatory charges or rates on telecommunication carriers licensed under the Telecommunications Act. Statement of the case The Telstra companies – Telstra Corporation Ltd and Telstra Multimedia Pty Ltd ("Telstra") – and the Optus companies – Optus Vision Pty Ltd and Optus Networks Pty Ltd ("Optus") – commenced proceedings in the Federal Court against a number of Victorian and New South Wales local government councils. All four companies are "carriers" under the Telecommunications Act48. In the proceedings, Telstra and Optus sought declarations that Pt 8 of the Local Government Act 1989 (Vic) and s 611 of the Local Government Act 1993 (NSW) did not authorise the imposition of rates or charges on cables owned by the companies. Two of the proceedings – S79/2003 and S80/2003 – arose from activities in Victoria and concern Pt 8 of the Victorian Local Government Act. The other two proceedings – S83/2003 and S84/2003 – arose from activities in New South Wales and relate to s 611 of the New South Wales Local Government Act. The Telstra companies are the respondents in matters S79 and S84. The Optus companies are the respondents in matters S80 and S83. 47 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198. 48 Under the Act, the holder of a carrier licence is known as a carrier. A carrier is an owner of a "network unit" – essentially, any communication line or designated radiocommunications facility in Australia – which may be used to supply "carriage services", namely, "a service for carrying communications by means of guided and/or unguided electromagnetic energy": ss 7, 26-29, 42. Carriers are one of the primary suppliers of telecommunications services in Australia. McHugh In the proceedings, Telstra and Optus claimed that the rates and charges were invalid for a number of reasons. The reasons included: the rates and charges were excises and, under the Constitution, only the Commonwealth could impose an excise; and the rates and charges discriminated against Optus and Telstra contrary to cl 44 of Sched 3 to the Telecommunications Act and were invalid by operation of s 109 of the Constitution. Wilcox J, who tried the actions, dismissed the claims49. His Honour held that, although rates imposed under Pt 8 of the Victorian Act were taxes, they were not taxes on goods and therefore not excises50. His Honour held that the charges imposed by s 611 of the New South Wales Act were not taxes and accordingly not excises51. Paragraphs (b) and (c) of cl 44(1) of Sched 3 to the Telecommunications Act were devoid of legal effect because they purported directly to invalidate State law or actions under State law. Accordingly, they were beyond the constitutional power of the federal Parliament52. Further, cl 44(1)(a) of Sched 3 was not a law upon which s 109 of the Constitution was An appeal by Telstra and Optus to the Full Court of the Federal Court succeeded. The Full Court (Sundberg and Finkelstein JJ54) held that: cl 44 of Sched 3 to the Telecommunications Act was a valid exercise of the power conferred on the Commonwealth Parliament by s 51(v) of the Constitution55; 49 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322. 50 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 350-351. 51 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 350-351. 52 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 369. 53 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 374. 54 After the hearing of the appeal, Katz J became unable to continue as a member of the Full Court. The parties consented to the appeal being completed by the Full Court constituted by Sundberg and Finkelstein JJ. 55 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 213. McHugh Pt 8 of the Victorian Act and s 611 of the New South Wales Act discriminated against Optus and Telstra56; and to the extent that those provisions authorised councils to impose rates or the charges Telecommunications Act, the Constitution57. under licensed invalid under s 109 of telecommunications they were carriers The material facts and circumstances New South Wales The appellants in the New South Wales matters are bodies corporate under the New South Wales Local Government Act. They are Hurstville City Council, Kogarah Municipal Council, Leichhardt Municipal Council, Parramatta City Council, Penrith City Council, Randwick City Council, Hornsby Shire Council, Drummoyne Council, Burwood Council, Concord Council and Strathfield Municipal Council. Section 611(1) of the New South Wales Local Government Act confers power on a council to make an annual charge on a "person ... in possession, occupation or enjoyment of a rail, pipe, wire, pole, cable, tunnel or structure laid, erected, suspended, constructed or placed on, under or over a public place." However, the New South Wales Act exempts a number of bodies from the operation of the power, either under s 611(6) of the Act or pursuant to other New South Wales laws. Those protected under s 611(6) of the Local Government Act include the Sydney Water Corporation, the Hunter Water Corporation, any water supply authority, the New South Wales Rail Access Corporation in some circumstances, the owner or operator of a light rail system. Section 611(6)(a) provides that the section does not apply to the Crown. This immunity protects, relevantly, the Roads and Traffic Authority of NSW58. Those protected under other Acts include electricity network operators pursuant to s 50 of the Electricity Supply Act 1995 (NSW) and a person constructing or operating a pipeline authorised by a licence under s 40(1) of the Pipelines Act 1967 (NSW). Infrastructure Corporation) and, the Rail (now Telstra and Optus have installed underground coaxial cable and aerial coaxial cable in local government areas under the responsibility of each of the appellant councils. Acting under s 611 of the Local Government Act, each of the New South Wales appellants has imposed annual charges, at a rate per kilometre, 56 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215-217. 57 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 218. 58 This is the combined effect of s 611(6)(a) of the Local Government Act and s 46(2)(b) of the Transport Administration Act 1988 (NSW). McHugh in respect of these cables. Each appellant has also imposed charges under s 611 in respect of Australian Gas Light Company (AGL) pipelines. No charges under s 611 were made in relation to a range of other structures in public places – for instance, electricity wires, rail structures, traffic lights, post boxes, bus shelters and advertising signs. Victoria Each appellant in the Victorian matters is a body corporate established under the Victorian Local Government Act. The appellants are Bayside City Council, Moreland City Council, Frankston City Council and Yarra City Council. Part 8 of the Victorian Local Government Act empowers local government councils in Victoria to levy rates and charges on rateable land. Section 154(1) declares that, except as provided in s 154, all land is rateable. Sections 154 and 155 empower the Victorian councils to declare rates and charges on all land, except land exempted by s 154(2). The categories of land listed in s 154(2) include land that is the property of the Crown and land that is used exclusively for public or municipal services. Other uses of land are exempted from rates and charges by other legislation. At the relevant time, electricity companies were exempt59, as were retail gas suppliers60. Section 156 of the Victorian Act imposes primary liability for rates on the owner of the land. Telstra and Optus have each installed underground coaxial cable and aerial coaxial cable in local government areas under the responsibility of each of the appellant councils. Each of the appellants declared and levied rates on Telstra and Optus in respect of the land occupied by the cables. The rates were calculated by reference to one of the three systems of valuation permitted by s 157(1) of the Victorian Act: the site value, net annual value or capital improved value system. 59 Electricity Industry Act 1993 (Vic), s 46(1A). This Act was replaced by the Electricity Industry Act 2000 (Vic), which commenced on 1 January 2001. Section 94(4) of that Act exempts only electricity generation companies and associated entities from liability to pay rates in respect of land used for generation functions. (Such companies may elect to pay amounts agreed or determined under 60 Gas Industry Act 1994 (Vic), s 52(2). This Act was replaced by the Gas Industry Act 2001 (Vic), which commenced on 1 September 2001. Section 145 of that Act is in the same terms as s 52(2) of the 1994 Act. McHugh Commonwealth Clause 44 of Sched 3 to the Telecommunications Act is directed at State and Territory laws that discriminate against carriers. Clause 44(1) provides: "The following provisions have effect: a law of a State or Territory has no effect to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally; (b) without limiting paragraph (a), a person is not entitled to a right, privilege, immunity or benefit, and must not exercise a power, under a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally; (c) without limiting paragraph (a), a person is not required to comply with a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally." The issues In this Court, the following issues fall for determination: (1) Within the meaning of cl 44(1) of Sched 3 to the Telecommunications Act, does Pt 8 of the Victorian Local Government Act and/or does s 611 of the New South Wales Local Government Act discriminate, or have the effect of discriminating against, carriers? Is cl 44(1) a valid exercise of the power conferred on the Commonwealth Parliament by s 51(v) of the Constitution? Is cl 44(1) invalid because it intrudes into State power and infringes the the implied Constitution by virtue of the federal structure? limitations on federal legislative power inherent (4) Does cl 44(1) validly engage s 109 of the Constitution, or is it a law which merely seeks to deny effect to a State law? McHugh Do the State laws discriminate against carriers? On their face, the Victorian and New South Wales laws operate generally. If those laws do not discriminate, or do not have the direct or indirect effect of discriminating, against Telstra and Optus, then cl 44(1) has no application to the New South Wales or Victorian laws. On that hypothesis, the constitutional issues do not arise. However, the Full Court concluded that, because many bodies which would otherwise be required to pay the council rates or charges were exempt from the State laws, those laws had the "direct or indirect effect of discriminating" against carriers61. The Full Court concluded that the word "discrimination" in cl 44(1) should be given its ordinary meaning: "differential treatment ... the failure to treat all persons equally where there is no reasonable distinction to justify different treatment."62 The Full Court addressed the question whether the State laws discriminated, in this sense, against the carriers. The Court said63: "In our view there is discrimination when a tax is imposed on a carrier in respect of certain of its activities, for example, on the occupation of a public place by underground or aboveground cables through which communications are sent, but is not imposed on other bodies which make a similar use of public places, such as electricity, gas or water utilities which lay pipes or cables over or under public places to transmit their 'goods'. It is discrimination against the carrier because it accords to it less favourable treatment than to the other occupiers of public space." The appellants contended that a law of general application does not discriminate merely because it exempts a "small group of identified entities" from its operation. I cannot accept this argument. The reference in cl 44(1) to direct and indirect effect focuses on the actual effect of the State law. That the New South Wales and Victorian provisions are of general application is of no relevance if every entity that could conceivably be charged for their use of public land – other than carriers – is exempted from the operation of the provisions. To describe the exempted entities as a small group is to ignore that they are the only entities other than carriers on which charges could be imposed under the Victorian and New South Wales provisions. Later in this judgment, I consider 61 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 213, 215. 62 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215. 63 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215. McHugh the significance to this issue of the liability of retail gas suppliers to pay charges in New South Wales. The appellants submitted that, while the State laws differentiate between the exempted entities and other persons – including carriers – they do not "discriminate against" carriers in the relevant sense. The appellants contended that different treatment of two entities or classes will only be discrimination where the different treatment is based on some impermissible ground or, in the case of indirect discrimination, where apparently equal treatment has a differential impact according to a criterion which is impermissible. They relied on statements by Gaudron J in Street v Queensland Bar Association64 and by Gaudron J and myself in Castlemaine Tooheys Ltd v South Australia65 to support this proposition. However, the distinction between the "constitutional" meaning of discrimination – the sense in which the concept is used in s 117 and in ss 51(iii) and 99 of the Constitution – and the "ordinary" meaning of the term is of little importance in the context of this case. The Full Court held, correctly in my opinion, that the State legislation discriminated against Telstra and Optus even if the apparently narrower scope of the constitutional meaning of that word were applied66. Reasonable distinction? The Full Court accepted that different treatment amounts to discrimination only if there is no reasonable distinction to justify different treatment67. The appellants submitted that the key difference between Telstra and Optus on the one hand and the exempted bodies on the other is that the latter occupy land under statutory authorities granted by the States, while the appellants occupy land under authority granted by the Commonwealth. A State, they submitted, is entitled to prevent councils, which are the custodians of its land, from charging rates to the State's agents. However, the question whether a reasonable distinction exists must be examined in light of the law prohibiting discrimination, not the potentially discriminatory law. As Gaudron J and I said in Castlemaine Tooheys Ltd v South 64 (1989) 168 CLR 461 at 569-574. 65 (1990) 169 CLR 436 at 478. 66 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215. 67 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215. McHugh Australia68, a law "is discriminatory if it operates by reference to a distinction which some overriding law decrees to be irrelevant". It is of no present relevance whether or not, in exercising their powers under the applicable Local Government Act, councils are acting reasonably in perceiving a difference between State agencies and bodies authorised to carry out functions under federal law, such as Optus and Telstra. The question is whether the Telecommunications Act permits Optus and Telstra to be treated differently from State agencies in respect of rates and charges. It is true, as Wilcox J noted69, that cl 44(1) of Sched 3 to the Telecommunications Act provides no criteria by which a court may determine what differences are legitimate and what are illegitimate. His Honour observed that in this respect it differs from other federal statutes which prohibit discrimination and which provide such criteria, for example, the Racial Discrimination Act 1975 (Cth), the Sex Discrimination Act 1984 (Cth) and the Disability Discrimination Act 1992 (Cth)70. For the purposes of this case, it is unnecessary to determine whether cl 44(1) prohibits all differential treatment of carriers. It is sufficient to say that the wide and unconditional language of cl 44(1) suggests that the Commonwealth Parliament intended to protect carriers from special burdens without regard to any policy objective of a State or Territory law which imposed that burden. If the Parliament had intended to allow such policy objectives to be relevant, it would have framed cl 44(1) so as to prohibit only unreasonable discrimination. If the term "discriminate" in cl 44 is ambiguous, the proposition that the Parliament intended to allow State legislatures to treat carriers differently where this serves a policy objective of the State receives no support from either the Explanatory Memorandum or the Telecommunications Bill 1996 (Cth). The Explanatory Memorandum states71: the Second Reading Speech "The indirect discrimination which this clause is intended to prevent includes the following examples. ... Laws that impose a burden on facilities of a carrier that is not imposed on similar facilities (for example a tax on 'street furniture' which is in effect discriminatory against carriers (1990) 169 CLR 436 at 478 (emphasis added). 69 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 363. 70 See, for instance, s 30 of the Sex Discrimination Act, which permits discrimination in employment on the ground of sex if it is a "genuine occupational qualification" to be a member of the other sex. 71 Telecommunications Bill 1996 (Cth) Explanatory Memorandum, vol 3 at 27. McHugh because other bodies owning such equipment such as electricity authorities would be exempt from paying that tax) ...". The Second Reading Speech states72: the provisions "The bill continues and reinforces the [Telecommunications Act 1991 (Cth)] which prevent the law of a State or Territory from operating so as to discriminate against a carrier or a class of carrier. It provides that a State or Territory law has no effect to the extent that it discriminates, or has the effect of discriminating, either directly or indirectly against a carrier or a user or potential user of a carrier's services. An example of one kind of discrimination that this provision deals with are State or Territory laws which give special powers or immunities to public utilities such as electricity suppliers or railways where these are not also given to any carrier in that State or Territory in like circumstances." Neither the Explanatory Memorandum nor the Second Reading Speech refers to any policy objective of a State as a legitimate basis upon which either carriers may be treated differently from other public utilities or the facilities of carriers may be treated differently from similar facilities. indicates Parliament's purpose Wilcox J said73 that Telstra and Optus were inviting the Federal Court to use the above example in the Explanatory Memorandum not to determine any ambiguity about the word "discriminate", but to decide how cl 44(1) may be applied in a particular factual situation. However, in so far as an Explanatory Memorandum the Memorandum indicates that the Commonwealth Parliament, in using the term "discriminate", had the purpose of striking down laws similar to those in the present case. Further, it shows that the Parliament intended cl 44 to invalidate a law which treats a State authority or State-owned entity that provides an essential public service more favourably than carriers. For example, assuming that a Victorian instrumentality still owned and operated an electricity transmission and distribution network, cl 44 would operate in respect of a law which treated that entity more favourably than carriers74. is enacting a term, 72 Australia, Senate, Parliamentary Debates (Hansard), 25 February 1997 at 944 per 73 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 363-364. 74 Following the disaggregation of the electricity industries in Victoria and New South Wales, transmission and distribution networks are owned and operated by different entities. Private entities own, operate and maintain electricity distribution assets (poles and wires) in both States. The transmission network in Victoria is owned and operated by a private entity, SPI PowerNet Pty Ltd, while in New South (Footnote continues on next page) McHugh For this reason, it is unnecessary to evaluate the appellants' arguments as to why the States might reasonably have treated Telstra and Optus differently from other public utilities. With whom is the appropriate comparison? Clause 44(1) prohibits discrimination against a particular carrier, class of carriers or carriers generally. If the discrimination alleged was against a particular carrier, the appropriate comparison would probably be other carriers. Where the discrimination is alleged to be against "carriers generally", however, the issue arises as to the appropriate entity with which "carriers" should be compared. Was the Full Court correct to conclude that the appropriate comparison here was between Optus and Telstra on the one hand and "other bodies which make a similar use of public places"75 on the other? The appellants were unable to suggest any alternative point of comparison. Instead, they resorted to the suggestion that cl 44(1) is designed to prevent only laws aimed at carriers, rather than to ensure that carriers receive equal treatment. Such a narrow interpretation of "discrimination" is incompatible with the breadth of cl 44(1). In particular, the reference to the "direct or indirect" effect of a State or Territory law leaves no room for such an argument. In cases like the present, the allegedly discriminatory law itself provides the comparator for the purpose of cl 44(1). The New South Wales and Victorian Acts confer a power to levy charges or rates on the owners or occupiers of public land, that is, land used for a public purpose. This indicates that the Full Court was correct in comparing the position of carriers with that of other owners or occupiers of public land. In turn, this invites a comparison with electricity suppliers, water suppliers, gas suppliers and other pipeline users. These entities Wales a government owned statutory corporation which operates under the State Owned Corporations Act 1989 (NSW), TransGrid, owns and operates the transmission network. In the other States and Territories, private entities own and operate or lease and operate the electricity distribution networks in South Australia and the ACT. Government owned corporations own and operate electricity distribution networks in Queensland, Tasmania, Western Australia and the Northern Territory. In South Australia private entities lease and operate the electricity transmission network. Government owned corporations own and operate electricity transmission networks in Queensland, Tasmania, Western Australia and the Northern Territory. 75 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215. McHugh resemble Telstra and Optus in their ownership and/or occupation and use of public land, a use which involves putting wires, cables or pipes over or under the land. Other owners or occupiers of public land, whose use of the land is perhaps less directly comparable with that of Telstra and Optus, include rail authorities, road traffic authorities and public transport authorities. Whether the comparison is made with the first group or the second group, the New South Wales and Victorian Acts exempt all – or in the case of New South Wales, almost all – of these entities from the operation of the legislation. This has the effect that the New South Wales and Victorian Acts authorise charges or rates that discriminate against Telstra and Optus. The significance of the liability of gas suppliers in New South Wales In New South Wales, gas suppliers are the only bodies apart from Telstra and Optus that are subject to the charges. Section 51 of the Gas Supply Act 1996 (NSW) provides an exemption for gas network operators from local council charges, although this provision has not yet been proclaimed. The Full Court assumed, correctly in my opinion, that this liability on the part of gas network operators did not mean that the New South Wales councils did not discriminate against Telstra and Optus76. A person may be discriminated against even if some other person is treated equally unfavourably. If many other persons were also treated unfavourably, a question might arise whether the law discriminated against a particular person. This question does not arise in the present case. The great majority of occupiers of public space in New South Wales are exempt from local government charges. That gas suppliers remain subject to these charges does not alter the fact that carriers are treated less favourably than most comparable entities. The constitutional issues The central claim of the appellants is that cl 44(1) is a law about the power of State parliaments, rather than about telecommunications. On their analysis, and for essentially this reason, they claimed that cl 44 is unsupported by s 51(v) of the Constitution, breaches an implied limitation of the Constitution and does not engage s 109 of the Constitution so as to render the New South Wales and Victorian laws invalid. The Attorneys-General for Victoria, Western Australia and Queensland intervened to support the appellants' submissions. The Attorney- General for the Commonwealth intervened to support Telstra and Optus. 76 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 215. McHugh The scope of cl 44(1) As the Full Federal Court noted, it is necessary to consider the scope of cl 44(1) before considering its constitutional validity. The text of cl 44(1) is set out at [61] above. The Full Court thought that cl 44 had two possible interpretations. One was that it granted carriers exemption from all discriminatory State and Territory laws77. The second was that it prevented discrimination against a carrier by laws that affect the provision of telecommunications services78. Each appellant criticised the Full Court's reasoning and submitted that the Court put forward two different interpretations of cl 44(1). The Full Court, after referring to the content of Divs 2, 3 and 4 of Pt 1 of Sched 3 to the Telecommunications Act – which relate respectively to the inspection of land and the installation and maintenance of facilities – said that the "protection must relate to the carrying out of those activities."79 Second, the Court said that cl 44(1) was designed to prevent State and Territory legislatures from enacting discriminatory legislation "which would burden the activities of a carrier in the course of providing the telecommunications services for which the carrier holds a permit."80 The appellants contended that, on the first construction, cl 44(1) does not operate with respect to the Victorian and New South Wales provisions. In addition, Divs 2, 3 and 4 of Pt 1 of Sched 3 do not relate to occupation and enjoyment of telecommunications facilities. If the scope of cl 44(1) derives from those Divisions, the appellants argued, it does not extend to the kind of activities that Telstra and Optus were carrying out, namely, activities that had nothing to do with such inspection, installation or maintenance. However, I do not think that the Full Court intended to suggest that cl 44(1) was limited to the activities listed in Divs 2, 3 and 4 of Pt 1 of Sched 3. Rather, the Court was suggesting that these Divisions, together with the remainder of the Telecommunications Act, indicate that the Act is concerned with the regulation of carriers acting in their capacity as telecommunications carriers. 77 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 207. 78 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 207-208. 79 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 210. 80 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 210 (emphasis added). McHugh Schedule 3 is titled "Carriers' Powers and Immunities" and confers a variety of powers and immunities on carriers. The Schedule should not be read so that the immunities contained in it are limited to the powers contained in it. Such a construction is at odds with the accepted purposive approach to statutory interpretation. The appellants also criticised the second construction of cl 44. They contended that the concept of "telecommunications services" is so vague that it does not identify a particular set of activities which cl 44(1) protects. The Commonwealth Parliament may have intended to protect carriers in the particular activities which their carrier licences, under the Telecommunications Act, allow them to undertake – but it may equally have intended to cover a wider or narrower set of activities. This argument is unpersuasive. When cl 44(1) is viewed in the context of the rest of the Act, it is limited to protecting carriers only in relation to the provision of telecommunications services. The Act authorises the provision of those services. It seems natural to regard cl 44(1) as protecting carriers in so far as they carry out those services. It was not necessary for cl 44(1) to refer specifically to the provision of telecommunications services in cl 44 because this was the subject matter of the entire Act. If this meaning was not clear from the nature of the Act, s 15A of the Acts Interpretation Act 1901 (Cth) would require the clause to be read down so as to protect carriers only in relation to the provision of telecommunications services81. Is cl 44(1) a law with respect to telecommunications? The appellants its proper in each proceeding claimed characterisation, cl 44(1) is not a valid exercise of the power conferred by s 51(v) of the Constitution. Section 51(v) provides that the Commonwealth may make laws for the peace, order and good government of the Commonwealth with respect to "postal, telegraphic, telephonic, and other like services". that, on The Telecommunications Act provides for the licensing of an organisation to act as a carrier, and establishes the powers, rights, duties and immunities of a carrier. The Act also regulates the activities the subject of a carrier licence. These provisions are within s 51(v)82. Further, that head of power entitles the 81 Section 15A provides: "Every Act shall be read and construed subject to the Constitution, and so as not to exceed the legislative power of the Commonwealth, to the intent that where any enactment thereof would, but for this section, have been construed as being in excess of that power, it shall nevertheless be a valid enactment to the extent to which it is not in excess of that power." 82 R v Brislan; Ex parte Williams (1935) 54 CLR 262 at 277 per Latham CJ. McHugh Commonwealth to confer protection on carriers when they engage in activities the subject of the carrier licence, including protection against discriminatory State or Territory legislation83. Because s 51(v) gives the Commonwealth power to license and regulate telecommunications carriers and to confer powers and immunities on them, the conferring on carriers of an immunity from discriminatory State laws, including taxes, has a clear and direct connection with the head of power84. A s 51 power extends beyond laws that authorise, regulate or prohibit subjects that fall within or are incidental to that head of power. A s 51 power also authorises a law that expressly limits the operation of a State law in relation to a subject matter authorised, regulated or prohibited under that head of power. This Court has held on many occasions that, where the Commonwealth has power to regulate an area, it has power to protect entities which operate in that area from the effect of State laws. The cases, where the Court has so held, include Australian Coastal Shipping Commission v O'Reilly85, Botany Municipal Council v Federal Airports Corporation86 and Western Australia v The Commonwealth (Native Title Act Case)87. In O'Reilly, Dixon CJ said88: "The argument that under a legislative power of the Commonwealth the operation of State laws cannot be directly and expressly excluded has been used without effect in a succession of cases beginning with The Commonwealth v Queensland89. It may be worth remarking that the interpretation, long since adopted by this Court, of s 109 is hardly consistent in thought with such an argument. The Court has interpreted s 109 as operating to exclude State law not only when there is a more direct collision between federal and State law but also when there is found 83 Actors and Announcers Equity Association v Fontana Films Pty Ltd (1982) 150 CLR 169. 84 Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 79 per Dixon J; Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 at 490-491 per Barwick CJ; Leask v The Commonwealth (1996) 187 CLR 579 at 591 per Brennan CJ, 605 per Dawson J, 616 per McHugh J, 621-622 per Gummow J. (1962) 107 CLR 46. (1992) 175 CLR 453. (1995) 183 CLR 373. (1962) 107 CLR 46 at 56-57. 89 (1920) 29 CLR 1. McHugh in federal law the manifestation of an intention on the part of the federal Parliament to 'occupy the field'. ... Surely, consistency with that doctrine demands that a legislative power ... must extend to a direct enactment which expressly excludes the operation of State law provided the enactment is within the subject matter of the federal power. Indeed there can really be no other way of expressing the intention and accomplishing the federal legislative purpose." The appellants and the State Attorneys-General submitted that cl 44(1) is a law about discrimination and the operation of State laws, rather than a law about telecommunications. This argument ignores the principle that a law of the federal Parliament is valid if it is a law with respect to a s 51 head of power even if it may also be characterised as a law with respect to a subject that is outside the grant of federal power90. Clause 44(1) is a law which confers rights, powers and immunities on carriers and a law which deals with the effect of State and Territory laws on those carriers. Even if cl 44(1) can be characterised as a law with respect to the effect of State and Territory laws, that characterisation does not prevent it from being a law "with respect to" the head of power described in s 51(v). This is because it is a law with respect to telecommunications carriers, a subject that is within the scope of s 51(v). The appellants' submission on this point cannot stand with the decisions of this Court in O'Reilly91, Botany Municipal Council92 and the Native Title Act Case93. As the Court stated in its unanimous decision in Botany Municipal Council94: "There can be no objection to a Commonwealth law on a subject which falls within a head of Commonwealth legislative power providing that a person is authorized to undertake an activity despite a State law prohibiting, restricting, qualifying or regulating that activity." The appellants relied on two points to distinguish the current case from these decisions. First, they suggested that the Commonwealth is entitled to protect its own agent, but not an independent commercial enterprise, such as 90 Actors and Announcers Equity Association v Fontana Films Pty Ltd (1982) 150 CLR 169. (1962) 107 CLR 46. (1992) 175 CLR 453. (1995) 183 CLR 373. (1992) 175 CLR 453 at 465. McHugh Optus and (to a lesser extent) Telstra from the operation of State and/or Territory laws. Second, the appellants contended that the partial nature of the protection conferred on carriers distinguishes this case from the earlier decisions. Must the entity protected be a statutory authority? The appellants and the State interveners observed that many of the decisions referred to by the Full Court involved the protection of the Commonwealth or a Commonwealth agency from State legislation. For instance, the Australian Coastal Shipping Commission, a O'Reilly concerned Commonwealth statutory authority established under the Australian Coastal Shipping Commission Act 1956 (Cth). The Attorney-General for Western Australia suggested that Botany Municipal Council is also such a case. The persons exempted from the relevant New South Wales legislation, the Environmental Planning and Assessment Act 1979 (NSW), were contractors carrying out works for the Federal Airports Corporation, a Commonwealth statutory authority established under the Federal Airports Corporation Act 1986 (Cth). Although, historically, the Commonwealth has exempted Commonwealth statutory authorities from State taxes, this fact does not mean that these are the only bodies that the Commonwealth can exempt from State taxes or State laws. It is difficult to see why the telecommunications power, which enabled the Commonwealth to create its own telecommunications carrier (Telecom Australia, now trading as "Telstra"95) and to protect it from State laws96, does not extend to protecting a private company operating as a telecommunications carrier from State laws. 95 Until 1975, telecommunications services were provided by a government authority, the Department of the Postmaster General. The Australian Telecommunications Commission, trading as Telecom Australia, was established as a statutory corporation in 1975 to provide Australia's domestic telecommunications services. After 1992, the entity which traded as Telecom Australia (including the Australian and Overseas Telecommunications Corporation and Telecommunications Authority) international telecommunications services. Telecom Australia changed to the trading name "Telstra Corporation Limited" in April 1993 (trading domestically as "Telstra" since 1995) and, as an Australian public limited liability company, was partially privatised commencing November 1997. the Australian provided Australia's also 96 See, eg, Telecommunications Act 1975 (Cth), s 80, which operated to exempt Telecom Australia from taxation under any law of a State or Territory. McHugh The decisions of this Court on which the appellants sought to rely do not support the proposition that the Commonwealth may only exempt itself and its agents from the operation of State taxes or State laws. As O'Reilly concerned a Commonwealth statutory authority, the Court expressed its reasoning in terms of such an authority. However, there is nothing in that decision to suggest that the Commonwealth would only be entitled to protect a statutory authority from State taxation. In Botany Municipal Council, the Court upheld a federal law that exempted licensees of the Federal Airports Corporation from compliance with the Environmental Planning and Assessment Act 1979 (NSW). At no point did the Court suggest that this conclusion was based on the fact that the licensees had acquired any kind of governmental authority from the Federal Airports Corporation. Partial protection of carriers The primary judge, Wilcox J, held that, while s 51(v) would have entitled the Commonwealth Parliament to protect carriers from State laws, it was not open to the Parliament to prohibit only discriminatory State laws97. The appellants also relied on this argument – although in a slightly different form – in this Court. The appellants contended that a State law can only be rendered inconsistent with a federal law if the federal law "exclusively and exhaustively" covers the relevant field. Thus, the appellants claimed that in the Native Title Act Case the impugned provision was treated as expressing an intention that the Commonwealth law be exclusive and that it was valid only on this basis. It follows, claimed the appellants, that a provision such as cl 44(1) can only be valid if it is construed as indicating an intention that the federal law is to have exclusive operation – that it "cover the field" of telecommunications. The appellants contended that the Telecommunications Act does not deal with carriers in such a comprehensive way. In particular, the appellants pointed to Div 7 of Pt 1 of Sched 3 to the Telecommunications Act, which makes it clear that State laws are generally applicable to carriers. Accordingly, they submitted that cl 44(1) is beyond the legislative power of the Commonwealth Parliament in that it constitutes a "bare attempt to oust State law". If the Commonwealth is entitled to prohibit the States from taxing carriers generally, however, it is equally entitled to provide for a partial prohibition. Such a partial prohibition is connected with the head of power. It does not represent a bare attempt to oust State law. In the Native Title Act Case, the Court said in a unanimous judgment98: 97 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322 at 374. (1995) 183 CLR 373 at 468. McHugh "Provided it is within the legislative power of the Commonwealth to exclude completely the operation of State law extinguishing native title, it is within Commonwealth power to exclude partially or on terms the operation of a State law which has that effect." Implied limitation on Commonwealth legislative power I also agree, for the reasons given in the joint judgment, that cl 44 does not offend the principle in Melbourne Corporation v The Commonwealth99, namely, that the Constitution restricts Commonwealth legislative powers so as to prohibit discrimination which involves the placing on the States of special burdens or disabilities, and to prohibit laws of general application which operate to destroy or curtail the continued existence of the States or their capacity to function as governments. Accordingly, that clause does not infringe any implied limitation on Commonwealth legislative power resulting from the federal structure of the Constitution. Conclusion Clause 44(1) is therefore a valid exercise of the Commonwealth's power in relation to telecommunications. Part 8 of the Victorian Local Government Act and s 611 of the New South Wales Local Government Act, to the extent to which they impose rates and charges on telecommunications facilities have a discriminatory effect in their operation in relation to carriers under the Telecommunications Act. They are inconsistent with cl 44(1) and are inoperative under s 109 of the Constitution. Order The appeals should be dismissed. (1947) 74 CLR 31 at 81-83 per Dixon J; see also Queensland Electricity Commission v The Commonwealth (1985) 159 CLR 192 at 217 per Mason J. Callinan Facts These appeals were heard together. It is convenient to refer to all of the local authorities as the appellants, although at times in these proceedings their names may have appeared on the other side of the record, and to deal with the appeals together. The respondent corporations ("the respondents") are telecommunications companies. They are commercial corporations in every sense. Pursuant to rights conferred upon the respondents by the Telecommunications Act 1997 (Cth) ("the Telco Act"), by, for example Divs 2, 3 and 4 of Sched 3 to the Act, they have entered upon roads and other public spaces owned by the appellants, and have erected under, on, and above the surface of them, cables and other installations for the carriage of communications electronically. Almost invariably the respondents have made use of existing infrastructure such as electric light poles and subterranean pipes and conduits. It is common ground that the respondents have paid or offered no compensation to the appellants in respect of their entry upon, use and occupation of the land, air space, or existing infrastructure on or in which their installations have been erected or inserted. The appellants, some in New South Wales, and others in Victoria have resolved, the former pursuant to s 611 of the Local Government Act 1993 (NSW) ("the NLGA"), and the latter, to Pt 8 of the Local Government Act 1989 (Vic) ("the VLGA"), to make, levy and recover from the respondents charges ("the cable charges") in respect of the possession, occupation and enjoyment of the telecommunications cables erected or placed on, under or over public spaces. For present purposes it is sufficient to set out sub-ss 611(1), (2), (3) and (4) of the "611 Annual charge on rails, pipes etc (1) A council may make an annual charge on the person for the time being in possession, occupation or enjoyment of a rail, pipe, wire, pole, cable, tunnel or structure laid, erected, suspended, constructed or placed on, under or over a public place. The annual charge may be made, levied and recovered in accordance with this Act as if it were a rate but is not to be regarded as a rate for the purposes of calculating a council's general income under Part 2. The annual charge is to be based on the nature and extent of the benefit enjoyed by the person concerned. Callinan If a person is aggrieved by the amount of the annual charge, the person may appeal to the Land and Environment Court and that Court may determine the amount." The Court did not have before it any of the relevant resolutions. The description that I have just given of them, although imprecise, is apparently the description that the parties were content to adopt, and was in terms incorporated in the declarations of the Full Court of the Federal Court from which these appeals are brought100. In 1901 the Commonwealth Government established the Postmaster- General's Department to own and manage all domestic telephone, telegraph and postal services. Subsequently, in 1946, the Commonwealth Government to manage the Overseas Telecommunications Commission established international telecommunications services. These were wholly owned organs of government. In 1975 the Australian Telecommunications Commission was established by s 4 of the Telecommunications Act 1975 (Cth). Although it was corporated (by s 21(1)(a)) it was wholly owned by the Commonwealth and directed by Commissioners appointed by the Governor-General (s 22). Section 6 of the Telecommunications Amendment Act 1988 (Cth) preserved and continued the Australian Telecommunications Commission as a body corporate under the name Australian Telecommunications Corporation (trading as Telecom). In 1991 however, all of the property, rights and liabilities (actual, contingent and prospective) of Telecom were, by s 11 of the Australian and Overseas Telecommunications Corporation Act 1991 (Cth) ("the AOTC Act"), vested in a company incorporated under the Corporations Law of the Australian Capital Territory with the name Australian and Overseas Telecommunications Corporation Limited ("AOTC"). AOTC was registered under the Australian Capital Territory law on 6 November 1991 as an unlisted public company limited by shares. On 13 April 1993, AOTC was renamed Telstra Corporation Limited. The Transport and Communications Legislation Amendment Act 1994 (Cth) subsequently amended the title of the AOTC Act to the Telstra Corporation Act 1991 (Cth) ("the Telstra Corporation Act"). The Commonwealth is a major shareholder in Telstra Corporation but quite separate from it in all relevant respects. Section 26 of the Telstra Corporation Act provides that, for the purposes of Commonwealth, State and Territory laws, Telstra is not to be taken as incorporated for a purpose of the Commonwealth, or as being a public authority, instrumentality or agency of the Crown, or as entitled to any immunity or privilege of the Commonwealth. The second Telstra respondent (Telstra 100 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198. Callinan Multimedia Pty Ltd) and the Optus respondents have no history of government ownership of any kind. These circumstances, it may, at the outset be noted, provide an important point of departure from the facts of Botany Municipal Council v Federal Airports Corporation ("Third Runway Case")101. There the respondent which sought to avoid compliance with State environmental laws was not only a corporation owned by the Commonwealth, but also had acquired under the Lands Acquisition Act 1989 (Cth) the fee simple in the land the subject of the proposed works and identified interests in the dredging site adjacent thereto. The work to be undertaken there, although it might be done by private contractors, was work on Commonwealth land on behalf of, and directly for the benefit of a Commonwealth body. The case has nothing of relevance to say about the Commonwealth's right to impose its own basis of charging (or not charging) for the use by its licensees of land and space in which neither it nor they have any proprietary interest. Various utilities operators, owned, or licensed, or regulated by the States, or emanations of them, have erected and inserted their installations (the "utilities installations") for the carriage, for example, of water, gas and electricity, in the same, or similar public spaces to the respondents. So too has Australia Post, but it is entirely a department or creature of the Commonwealth and enjoys immunity from rates and like levies sought to be raised by the States or authorities of them by virtue of s 114 of the Constitution.102 The States have in some instances legislated to confer exemptions upon some of the owners, occupiers and users of utilities installations.103 The activities of the respondents are not governed merely by the Telco Act. The Trade Practices Act 1974 (Cth) establishes a regime for the promotion and maintenance of competition in the industry in which the respondents are engaged (see Pts XIB and XIC). 101 (1992) 175 CLR 453. 102 "States may not raise forces. Taxation of property of Commonwealth or State 114 A State shall not, without the consent of the Commonwealth, raise or maintain any naval or military force, or impose any tax on property of any kind belonging to the Commonwealth, nor shall the Commonwealth impose any tax on property of any kind belonging to a State." the Parliament of 103 See Gas Industry Act 1994 (Vic), (s 52(2)), Electricity Industry Act 1993 (Vic), (s 46(1A)), Local Government Act 1989 (Vic), (s 154(2)), Gas Supply Act 1996 (NSW), (s 51), Electricity Supply Act 1995 (NSW), (s 50), Local Government Act 1993 (NSW), (s 611(6)), and Pipelines Act 1967 (NSW), (s 40(1)). Callinan Division 7 of Sched 3 to the Telco Act (comprising cll 36 to 39) is concerned with exemptions to carriers from some State and Territory laws. Clause 36 provides that, subject to cl 37, Divs 2, 3 and 4 of Sched 3 do not operate so as to authorise an activity to the extent that the carrying out of the activity would be inconsistent with the provisions of a law of a State or Territory. Clause 37 then sets out specific exemptions from cl 36. It only applies to an activity carried on by a carrier if the activity is authorised by Divs 2, 3 or 4. Clause 37 then provides as follows: "37 Exemption from State or Territory laws The carrier may engage in the activity despite a law of a State or Territory about: the assessment of the environmental effects of engaging in the activity; or the protection of places or items of significance to Australia's natural or cultural heritage; or town planning; or the planning, design, siting, construction, alteration or removal of a structure; or the powers and functions of a local government body; or the use of land; or tenancy; or the supply of fuel or power, including the supply and distribution of extra-low voltage power systems; or a matter specified in the regulations." Clauses 38 and 39 further define these exemptions. Clause 38 provides: "38 Concurrent operation of State and Territory laws It is the intention of the Parliament that, if clause 37 entitles a carrier to engage in activities despite particular laws of a State or Territory, nothing in this Division is to affect the operation of any other law of a State or Territory, so far as that other law is capable of operating concurrently with this Act." Callinan Clause 39 states: "39 Liability to taxation not affected This Division does not affect the liability of a carrier to taxation under a law of a State or Territory." It follows that none of the exemptions granted to a carrier engaging in activities authorized by Divs 2, 3 and 4 of Sched 3 affords immunity from liability to taxation under a law of a State or Territory. The respondents asserted that they were not obliged to pay the cable charges: the purported making of the charges, when carriers of energy and electricity are exempted from them, involved unlawful discrimination against them contrary to cl 44 of Sched 3 to the Telco Act which provides as follows: "44 State and Territory laws that discriminate against carriers and users of carriage services The following provisions have effect: a law of a State or Territory has no effect to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally; (b) without limiting paragraph (a), a person is not entitled to a right, privilege, immunity or benefit, and must not exercise a power, under a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally; (c) without limiting paragraph (a), a person is not required to comply with a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular carrier, against a particular class of carriers, or against carriers generally. The following provisions have effect: a law of a State or Territory has no effect to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a Callinan particular eligible user, against a particular class of eligible users, or against eligible users generally; (b) without limiting paragraph (a), a person is not entitled to a right, privilege, immunity or benefit, and must not exercise a power, under a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular eligible user, against a particular class of eligible users, or against eligible users generally; (c) without limiting paragraph (a), a person is not required to comply with a law of a State or Territory to the extent to which the law discriminates, or would have the effect (whether direct or indirect) of discriminating, against a particular eligible user, against a particular class of eligible users, or against eligible users generally. For the purposes of this clause, if a carriage service is, or is proposed to be, supplied to a person by means of a controlled network, or a controlled facility, of a carrier, the person is an eligible user. The Minister may, by written instrument, exempt a specified law of a State or Territory from subclause (1). The Minister may, by written instrument, exempt a specified law of a State or Territory from subclause (2). (6) An exemption under subclause (4) or (5) may be unconditional or subject to such conditions (if any) as are specified in the exemption. (7) An instrument under subclause (4) or (5) is a disallowable the Acts the purposes of section 46A of instrument for Interpretation Act 1901." First Instance Whether the respondents' assertion was correct was, together with other issues (the "other issues"), the subject of proceedings commenced by the respondents and tried by Wilcox J in the Federal Court at first instance104. His Honour resolved some of those other issues adversely to the respondents, and 104 Telstra Corporation Ltd v Hurstville City Council (2000) 105 FCR 322. Callinan some he found it unnecessary to decide. For present purposes it is sufficient to say that the assertion of the respondents was held by Wilcox J to be incorrect. The Full Court of the Federal Court The respondents successfully appealed to the Full Court of the Federal Court105 which came to be constituted for the purposes of its decision by two judges only, Sundberg and Finkelstein JJ106, who made declarations as follows: section 611 of the Local Government Act 1993 (NSW), to the extent that it authorises the first to eleventh respondents to make, levy and recover from the appellants charges in respect of the possession, occupation and enjoyment of telecommunications cables erected or placed on, under or over a public place; and Part 8 of the Local Government Act 1989 (Vic), to the extent that it authorises the twelfth to fifteenth respondents to declare and recover from the appellants rates and charges on land occupied by telecommunications cables; discriminates or has the effect (whether direct or indirect) of discriminating against a carrier or carriers generally, within clause 44(1) of Schedule 3 to the [Telco Act], and is to that extent inconsistent with clause 44(1) and invalid pursuant to section 109 of the Constitution." The appeal to this Court The appellants relied upon several arguments in this Court including that the cable charges did not involve discrimination within the meaning of cl 44 of Sched 3 to the Telco Act, and that sub-cl 1 was not a valid exercise of the power conferred upon the Commonwealth by s 51(v) of the Constitution, that is, to make laws with respect to postal, telegraphic, telephonic and other like services. Western Australia, intervening to support the appellants, also submitted that cl 44 was in any event invalid for infringing the restriction on Commonwealth power first explained in Melbourne Corporation v The Commonwealth107. The two 105 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198. 106 The third judge of the Full Court, Katz J, became unable to continue as a member of the Court. 107 (1947) 74 CLR 31. That the restriction may apply to a law which would otherwise be characterized as being with respect to a subject matter of Commonwealth legislative power is made clear at 50 per Latham CJ, 63-64 per Rich J, 66-67 per Dixon J; see also Victoria v The Commonwealth (the "Payroll Tax Case") (1971) (Footnote continues on next page) Callinan matters are by no means unrelated. A large or obvious intrusion upon the capacity of a State to carry out the functions of government of that State may, of itself, provide an indication that the Commonwealth law is not sensibly related, or only tenuously so, to a Commonwealth head of power. For this reason it will be convenient to deal with these arguments together. And because I am satisfied that they are correct it will be unnecessary for me to explore any of the others. Is cl 44 within Commonwealth power: does the Melbourne Corporation doctrine apply? There is no doubt, as s 51(v) of the Constitution provides, that parliament may make laws with respect to the activities in which the respondents engage, relevantly telegraphic, telephonic and like services. It is important to keep in mind however that creation of a conflict by the enactment of a Commonwealth law with a State law cannot of itself provide a basis for the validity of a Commonwealth law. Section 109 of the Constitution108 is not, and cannot be used, either directly or indirectly as a head of power. And it is to that issue that inquiry must first be directed: is the apparently conflicting Commonwealth law within power? A law enacted by the Commonwealth not sensibly related to, or, to adopt language used by this Court on other occasions, having an "insubstantial, tenuous or distant109" relationship only with a head of Commonwealth power, cannot be a valid exercise of that power. It may be accepted that for a law to be a valid exercise of a head of power it is not necessary that every one of its provisions be seen to be exclusively within the power. This is so, not simply because of the presence of the incidental power in s 51(xxxix) of the Constitution110. Few if any 122 CLR 353 at 387 per Menzies J and in Queensland Electricity Commission v The Commonwealth (1985) 159 CLR 192 at 250 per Deane J and 260 per 108 "Inconsistency of laws 109 When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid." 109 Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 79 per 110 "Legislative powers of the Parliament The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: (Footnote continues on next page) Callinan human or public endeavours can be completely disconnected from others. Take for example the power of the Commonwealth to legislate with respect to weights and measures in s 51(xv) of the Constitution. An Act to require that a particular locally produced commodity may not be sold over the counters of shops in New South Wales unless it be sold in boxes measuring 10 cms by 10 cms by 10 cms exactly, although it may use the language of measures and is in that sense about or related to them, is not truly a law with respect to measures. Its proper characterization would be as a law with respect to either or all of, the particular commodity, retail trade or consumer protection in New South Wales. So too, s 51(xxviii) of the Constitution, "the influx of criminals" would not empower the Commonwealth to make a law prescribing a complete sentencing regime for a State, albeit that the regime might have an effect upon some criminals who might be disposed to try to enter Australia. In Leask v The Commonwealth111 Gummow J, before pointing out that a single law can possess more than one character, adopted a passage from the judgment of McHugh J in Re Dingjan; Ex parte Wagner112: "In determining whether a law is 'with respect to' a head of power in s 51 of the Constitution, two steps must be taken. First, the character of the law must be determined. That is done by reference to the rights, powers, liabilities, duties and privileges which it creates113. Secondly, a judgment must be made as to whether the law as so characterised so operates that it can be said to be connected to a head of power conferred by s 51. In determining whether the connection exists, the practical, as well as the legal, operation of the law must be examined114. If a connection exists between the law and a s 51 head of power, the law will be 'with respect to' that head of power unless the connection is, in the (xxxix) matters incidental to the execution of any power vested by this Constitution in the Parliament or in either House thereof, or in the Government of the Commonwealth, or in the Federal Judicature, or in any department or officer of the Commonwealth." 111 (1996) 187 CLR 579 at 621. 112 (1995) 183 CLR 323 at 368-369. 113 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 114 Herald & Weekly Times Ltd v The Commonwealth (1966) 115 CLR 418 at 440; The Tasmanian Dam Case (1983) 158 CLR 1 at 152. Callinan words of Dixon J115, 'so insubstantial, tenuous or distant' that it cannot sensibly be described as a law 'with respect to' the head of power." In argument the respondents accepted that the paragraph which has just been quoted stated the test to be applied here. What rights, powers, liabilities, duties and privileges does cl 44(1) of Sched 3 to the Telco Act purport to create? In answering the question a practical view should be taken of the effect and impact of the provision.116 Subject to one qualification, it would be mere semantics to regard the right or privilege which the section seeks to create as other than a right or privilege of enjoying exactly the same immunities and exemptions from charges as all, or some of the other operators of utilities using and occupying public spaces which the States own or over which they have legislative power, as the States choose to confer upon them. (The qualification relates to the meaning to be given to "carrier" in the clause, a matter to which I will refer later). Of what character or characters is a law that produces that practical result? It seems to me that a characterization of it as other than a law with respect to the use and occupation of "State" public spaces, or "State activities", or discriminatory charging in respect thereof, is artificial and strained. "State activities" could mean for example, the insistence on payment of registration fees on motor vehicles. Clause 44 would appear to be cast in terms wide enough to preclude a State from exempting a carrier owned and operated or regulated by the State from motor vehicle registration fees unless the respondents' vehicles were similarly exempted. Another equally accurate characterization of cl 44, is as a law with respect to the way in which the States choose to assist, or facilitate, or make less expensive, the delivery of energy and commodities to consumers within the States, by operators of utilities over which the States have control. Such a characterization assumes of course, in the respondents' favour, that a differential approach to charging various utilities operators, including the respondents, is within the concept of "discrimination" as that concept finds expression in cl 44 of Sched 3. A further accurate characterization of the law is as a law with respect to the price of the use and occupation of State controlled land in which the Commonwealth has no proprietary rights, the Commonwealth117 (or its licensees 115 Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 79. 116 cf Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 492 [16] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. 117 The assumption is probably correct. See P J Magennis Pty Ltd v The Commonwealth (1949) 80 CLR 382 at 401-402 per Latham CJ. See also cl 42 of Sched 3 to the Telco Act which provides a regime for the assessment of compensation. Callinan the respondents, assuming they could) not having chosen to acquire any. The fact that the respondents may have rights of statutory user carries with it no entitlement to dictate or even influence the financial terms of their use. Yet another possible characterization of cl 44 is as a law with respect to State constitutional power, a characterization which brings into play the Melbourne Corporation doctrine118. Remarks made by Gaudron, Gummow and Hayne JJ in Austin v The Commonwealth119, the most recent application of Melbourne Corporation, regarding the limits of federal power in relation to its operation upon the States are of relevance to a question of characterization. It is to "'the substance and actual operation' of the federal law [cl 44]" that regard must be had. The State of Queensland with one exception120 correctly submits that the practical effect of cl 44 is this: "[it] puts the States in a dilemma. Either they forgo revenue from licensed carriers that even in the judgment of the Commonwealth Parliament, would not be an unreasonable burden for licensed carriers to bear or, they change their own policy about a matter totally within State jurisdiction and tax hitherto exempt entities. A State could levy rates and charges against carriers' infrastructure on or over public land only if it also ensured that similar rates and charges were levied against other infrastructure owners whether or not the State wished to expose these owners to the rates and charges." Because of the other reasons which lead me to the conclusion that I reach in this appeal, it is unnecessary for me to consider whether the true and substantial effect of cl 44, if valid, would also be to confer upon the respondents, contrary to cl 39 of Sched 3, an exemption from liability to taxation, if the charges are to be so identified, and the relationship between these two clauses. In a passage in Murphyores Incorporated Pty Ltd v The Commonwealth121 Stephen J (Barwick CJ and Gibbs J agreeing) suggested that the fact that a decision when made would be expressed in terms of a constitutional power of the Commonwealth, was sufficient to enable the decision (and presumably the enactment under which it was made) to be characterized as being under and within the relevant power. This is to prefer form to substance, the latter being that to which courts now look. Accordingly, the fact that different phraseology 118 (1947) 74 CLR 31. 119 (2003) 77 ALJR 491 at 518 [124]; 195 ALR 321 at 357. 120 The reference to "tax" is not in my opinion appropriate. 121 (1976) 136 CLR 1 at 12. Callinan might be used, unconvincingly in my view, to give cl 44 a flavour of the exercise of the telecommunications power cannot suffice to give it that real and true character. It is difficult to see how a State law that imposes a charge for use and occupation upon an operator which is not the Commonwealth, but which merely owes its right to carry out its activities to enactments within Commonwealth power can burden the Commonwealth in any way (or for that matter the respondents as its licensees), or give rise to a need for the protection of the Commonwealth. Section 26 of the Telstra Corporation Act manifests a clear intention that the Telstra respondents are not to enjoy any advantages which they would have if they were in fact the Commonwealth. This litigation equally manifests a rejection of that intention as does, it must be assumed, cl 44 itself. What is somewhat unusual is that s 26 of the Telstra Corporation Act is not expressed to be subject to the Telco Act and cl 44 is not introduced by a conventional formula such as "Notwithstanding anything herein or elsewhere ...". The task of interpretation and reconciliation is left therefore entirely to the courts. I would say this about the respondents' submissions that the charges are a burden. The word "burden" is a misnomer in these circumstances. The New South Wales legislature was right in enacting in s 611(2) of the NLGA that the charges were not to be regarded as a "rate". As s 611(3) makes clear, they are based upon the nature of the benefit enjoyed. They are charges for value received personally. They are not in any sense a tax or a rate. A significant and valuable benefit not derived by the community generally is enjoyed by the respondents. The language of revenue law is inapt in the circumstances. The charges are not even burdensome in the sense of being arbitrary or excessive, because, so far as New South Wales at least is concerned, s 611(4) of the NLGA provides a mechanism for judicial assessment of quantum. Another unusual feature of the Telco Act is that there is no definition, or indeed even any attempt at internal identification of those carriers with whose activities and charges made upon them, the respondents and like carriers are to be compared for the purposes of cl 44. The explanation may be that originally the relevant purpose was to prohibit discrimination between telecommunications carriers. On their faces, the expressions used in cl 44, "particular carrier", "class of carriers" and "carriers generally" could mean carriers by road, rail or air, and not necessarily by cable, wire or pipeline. It is quite unsatisfactory to have to resort to a Second Reading speech and only the vaguest of indications in the Telco Act to try to ascertain at which kinds of carriers as comparators the Telco Act is aimed. It seems that the legislature may even have had in mind State railways as an appropriate comparator. Relevantly the Second Reading speech was as follows122: 122 Australia, Senate, Parliamentary Debates (Hansard), 25 February 1997 at 944. Callinan "The bill continues and reinforces the provisions in the [AOTC Act] which prevent the law of a State or Territory from operating so as to discriminate against a carrier or a class of carrier. It provides that a State or Territory law has no effect to the extent that it discriminates, or has the effect of discriminating, either directly or indirectly against a carrier or a user or potential user of a carrier's services. An example of one kind of discrimination that this provision deals with are State or Territory laws which give special powers or immunities to public utilities such as electricity suppliers or railways where these are not also given to any carrier in that State or Territory in like circumstances." What had been said earlier in relation to cl 42 which was to become the present cl 44 was similarly unilluminating123: "Clause 42 State and Territory laws that discriminate against carriers This clause provides that a State or Territory law has no effect to the extent to which it discriminates, or has the effect of discriminating, directly or indirectly against a carrier, or a user or potential user of a carrier's services. It is based on s 120 of the [AOTC Act]. The clause is intended to deal with laws which have an indirect effect of discriminating against carriers or users of carrier services, not just a law which, for example, on its face treats a person differently to someone else. The indirect discrimination which this clause is intended to prevent includes the following examples: laws that impose a burden on facilities of a carrier that is not imposed on similar facilities (for example a tax on 'street furniture' which is in effect discriminatory against carriers because other bodies owning such equipment such as electricity authorities would be exempt from paying that tax); laws which have the effect of giving powers or immunities to a person or body in relation to the installation, maintenance or operation of a facility which do not apply to carriers generally (for example, where a public utility may rely on general land access powers given to that utility under State or Territory law to install telecommunication facilities without obtaining the approvals which would ordinarily be required for that activity under the law of that State or Territory); and 123 Explanatory Memorandum to the Telecommunications Bill 1996, vol 3 at 27. Callinan laws which discriminate against people by reason of their use of the facilities of a carrier." Again the word "burden" is misused. For a person owning or controlling land or space to require user A to pay for its use and occupation and not users B and C is not to impose a burden on user A: it is simply to choose to forgo a right in respect of some but not all users. There is another misstatement. The so- called burden is not upon the facilities. It is a charge for the use and occupation of the space they occupy. Here the Full Court said this124: "... it can be seen that the object cl 44 is designed to achieve ... is to prevent State or Territory legislatures from enacting potentially unfairly discriminatory legislation which would burden the activities of a carrier in the course of providing the telecommunications services for which the carrier holds a permit." The passage uses language which departs from the Telco Act and contains a large assumption: that the State exempting enactments were "potentially unfairly discriminatory". It is far from obvious that it is unfair to exempt the means of delivery of, for example an essential commodity such as pure water, but not the means of delivery of television programmes transmitted from a studio of a commercial broadcaster, or bounced on to or off a satellite and transmitted by cable for a substantial reward to a commercial broadcaster and the respondent carriers. Nor can a court know whether, and what compromises may have been made between a State and a carrier to enable the latter to provide a service or a commodity to residents of that State. So too, a State may have chosen to exempt one or more carriers from charges, or to differentiate between carriers in order to provide employment or infrastructure in a particular area, or to provide a fundamental service to its taxpayers and residents. Intrusion into these matters represents a grave potential interference with the capacity of the States to carry out their functions of government: government in relation to essential matters of water, energy, the environment, and also therefore, health. By s 154(2)(b) of the VLGA, for example, water distributors in public ownership are exempted from charges. It is no answer to say that these are matters which may be taken into account in deciding, pursuant to cl 44 of Sched 3 to the Telco Act whether discrimination has occurred. I doubt whether any satisfactory equation exists or can be devised of the various benefits and costs of the objects a State may wish to achieve with the charges that it chooses to impose or refrain from imposing. 124 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 210 [24]. Callinan In any event a State should not be obliged, as it would be in proceedings under or relating to cl 44, to justify and quantify the political, demographic, social and economic objectives that it sets out to achieve in the exercise of legitimate State power, particularly in respect to land which neither the Commonwealth nor a non-public licensee of the Commonwealth has sought to acquire, or has acquired. On the construction of cl 44 advanced by the respondents the States' ability to further their policies by, for example, enacting workplace safety laws, and regulating motor vehicle insurance, would all be in jeopardy so far as they related to the respondents. To give cl 44 such an operation would inevitably, to use the language of Gaudron, Gummow and Hayne JJ in Austin125, involve a "'curtailment' of [the] 'capacity' of the States 'to function as governments'." Something needs to be said about the respondents' submission that the charges are taxes. Luton v Lessels126 is the most recent decision of this Court as to the nature of a tax. There Gleeson CJ cited127 a passage from the judgment of Latham CJ in Matthews v Chicory Marketing Board (Vict)128: "The levy is, in my opinion, plainly a tax. It is a compulsory exaction of money by a public authority for public purposes, enforceable by law, and is not a payment for services rendered." Although Gleeson CJ offered a caution against reading the statement of Latham CJ and statements by other judges elsewhere as exhaustive definitions of a "tax", his Honour did not suggest that the distinction made by Latham CJ between an exaction for public purposes, and a payment for services rendered, the latter being of a very similar kind to use and occupation, was not well made. If there were any doubt about this it can be dispelled by reference to the joint judgment of Gaudron and Hayne JJ in Luton v Lessels in which their Honours said129: "...as the Court also pointed out in Air Caledonie130, the reference to 'payments for services rendered', as an antonym for 'tax', is only one example of various special types of exactions of money which are not 125 (2003) 77 ALJR 491 at 518 [124]; 195 ALR 321 at 357. 126 (2002) 210 CLR 333. 127 (2002) 210 CLR 333 at 342 [10]. 128 (1938) 60 CLR 263 at 276. 129 Luton v Lessels (2002) 210 CLR 333 at 352-353 [50]. 130 Air Caledonie International v The Commonwealth (1988) 165 CLR 462 at 467. Callinan taxes. Charges for the acquisition or use of property, fees for a privilege, and fines or penalties for criminal conduct are some other examples of what are unlikely to amount to forms of tax." (emphasis added) McHugh J in Luton v Lessels also pointed out that the fact that charges collected may go into Consolidated Revenue does not mean that they are on that account alone taxes131. The same may equally be said of the depositing of the charges here in the appellants' general or rate accounts, or otherwise as the case may be. Something additional needs to be said about the proposition that the charges are a tax by way of rates or a "rate". The answer to that proposition is a short one. The charges here are made not just in respect of the use and occupation of airspace and land, but for space and land owned or controlled by the appellants. However the charges are to be characterized, a characterization of them as a rate upon land or space is inappropriate. The charges are therefore neither a tax, a rate nor a burden. The Full Court of the Federal Court relied, for the different view that they formed upon three cases. Each of them is distinguishable. Australian Coastal Shipping Commission v O'Reilly132 was concerned, not as here with corporations separate from and mere licensees of the Commonwealth but with a corporate agency of the Commonwealth, as Dixon CJ described it133, a Commonwealth government body. It is one thing to seek to protect as the legislation did there, a Commonwealth government body, but a quite different thing, to protect a commercial licensee forming no part of the government, a matter to which I will return. Indeed one of the main purposes of the Telco Act and the other related legislation was, as the Second Reading speech further stated, "to promote fair, but vigorous, competition in this industry"134; a goal somewhat removed from that ordinarily pursued by a governmental, and therefore usually, a monopolistic or preferred public enterprise. There is another point of distinction. In Australian Coastal Shipping Commission the issue was whether the agency should bear the burden of a state tax, stamp duty, an exaction simpliciter, in exchange for which the Commonwealth body obtained no rights, property, privilege or benefits. The issue here is not whether the respondents should bear the burden of a State tax: it is whether they should be entitled to use land and 131 (2002) 210 CLR 333 at 361-362 [80]; see also at 383-384 [177] per Callinan J. 132 (1962) 107 CLR 46. 133 (1962) 107 CLR 46 at 55. 134 Australia, Senate, Parliamentary Debates (Hansard), 25 February 1997 at 944. Callinan space owned by the State or a State creature upon exactly the same financial terms as undefined and only at best, vaguely contextually and extraneously identified other carriers. The second and third cases relied upon were Strickland v Rocla Concrete Pipes Ltd135 and Actors and Announcers Equity Association v Fontana Films Pty Ltd136. Both were concerned with the validity of sections of the Trade Practices Act. The second held that the proscription of certain monopolies with the object of protecting Australian trade and commerce generally was valid. It has little, in my opinion, of relevance to say about a provision such as cl 44. The third of the cases does not in my opinion throw much light upon the problem here. What the statement of Mason J137 quoted by the Full Court138 does emphasize is the need for the drawing of careful distinctions between laws going beyond the power generally, and laws which incidentally only have an operation upon objects outside the power. Here cl 44 strikes directly at, and does not merely incidentally touch or operate upon the use and occupation of State land and infrastructure and the price thereof. Clause 44, in its application to State laws cannot be characterized as a law with respect to telegraphic, telephonic and other like services merely because those State laws may have application to an operator required by the Telco Act to hold a licence to engage in telecommunications services. Neither R v Brislan; Ex parte Williams139 nor Jones v The Commonwealth [No 2]140 which were relied on by the respondents supports a proposition that a law exempting a Commonwealth licensee from State taxes, let alone charges for the use of State land and space, must be characterized as a law with respect to postal, telegraphic, telephonic and other like services. Something more needs to be said about the application of the Melbourne Corporation doctrine. In my opinion cl 44 answers the description of a law to 135 (1971) 124 CLR 468. 136 (1982) 150 CLR 169. 137 Actors and Announcers Equity Association v Fontana Films Pty Ltd (1982) 150 CLR 169 at 205-206. 138 Telstra Corporation Ltd v Hurstville City Council (2002) 118 FCR 198 at 212-213 139 (1935) 54 CLR 262. 140 (1965) 112 CLR 206. Callinan prevent, control, or seriously curtail State legislative action in a manner that infringes the implied restriction recognized in Melbourne Corporation. In terms it is directed to the intended and legitimate effect of State laws and rights arising under State law, rather than the operation and effect of an authority given by the Commonwealth. The Commonwealth Minister's power to exempt specified State laws, and to make the exemption subject to conditions, is another indication that the focus of cl 44 is on State laws, rather than on an exercise of Commonwealth power. The connexion sought to be drawn by the respondents is tenuous: between the State laws imposing charges and that a Commonwealth licensee might have to pay them at a differential rate from others. It is true therefore that it is the operation of the State laws in relation to persons other than carriers, as much as the operation of State laws in relation to "carriers", which cl 44 seeks to control. In the circumstances the use of the word "protect" by the respondents in the sense of shielding or in some way defending the respondents against an assault by way of a charge levied upon them, is as misplaced and inappropriate as the respondents' use of the words "burden" and "tax". To exempt another or others, is not to burden the respondents. Or, to impose the same or a similar charge upon others, is not to burden, or otherwise to make an imposition upon the respondents. It cannot be entirely ignored that the respondents are not government agencies or part of government. Windeyer J in O'Reilly141 was the only Justice who expressed the view that the fact that the Commission there was an agency of the Commonwealth, was not a decisive factor142. At other times however emphasis has been placed on that fact. Dixon CJ in O'Reilly did so143. And in Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority144, Dawson, Toohey and Gaudron JJ said145: "[b]y exercising the legislative power granted to it by the Constitution the Commonwealth Parliament can legislate to exclude the operation of a State law with respect to the Commonwealth executive or its agencies." (emphasis added) The mere fact that the Commonwealth has the power to regulate an activity that may be engaged in by private and public bodies does not empower 141 (1962) 107 CLR 46. 142 (1962) 107 CLR 46 at 69. 143 (1962) 107 CLR 46 at 56. 144 (1997) 190 CLR 410. 145 (1997) 190 CLR 410 at 446. Callinan the Commonwealth to make a law on any subject applying to a regulated person. There is a statement to a similar effect by Rich and Williams JJ in Bank of NSW v The Commonwealth146 ("Bank Nationalisation Case"): that a provision immunising the Commonwealth Bank from the operation of State taxation "could only be valid with respect to State law if the Bank is an agent of the Commonwealth"147. It is also consistent, as Western Australia submits, with the manner in which decisions such as O'Reilly148 and The Commonwealth v Queensland149 have been subsequently viewed, as depending on a connexion of the subject matter of the law with the Commonwealth itself. It follows, in my opinion, that cl 44 of Sched 3 to the Telco Act is beyond the power of the Commonwealth. It also offends against the doctrine of implied restrictions upon the curtailment by the Commonwealth of the legitimate governmental functions of the States. It is unnecessary for me therefore to consider any of the other arguments in the appeals. I would allow the appeals with costs, make declarations in accordance with the preceding paragraph, and order that the respondent corporations pay the appellants' costs of the appeals to the Full Court of the Federal Court. 146 (1948) 76 CLR 1. 147 (1948) 76 CLR 1 at 275. 148 (1962) 107 CLR 46. 149 (1920) 29 CLR 1.
HIGH COURT OF AUSTRALIA FAIRFAX MEDIA PUBLICATIONS PTY LTD APPELLANT AND RESPONDENT NATIONWIDE NEWS PTY LIMITED APPELLANT AND RESPONDENT AUSTRALIAN NEWS CHANNEL PTY LTD APPELLANT AND RESPONDENT Fairfax Media Publications Pty Ltd v Voller Nationwide News Pty Limited v Voller Australian News Channel Pty Ltd v Voller [2021] HCA 27 Date of Hearing: 18 May 2021 Date of Judgment: 8 September 2021 S236/2020, S237/2020 & S238/2020 ORDER In each matter: Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation N J Young QC and P D Herzfeld SC with L E Barnett for the appellant in each matter (instructed by Ashurst) P W J Gray SC with R W Potter SC and L A R Goodchild for the respondent in each matter (instructed by O'Brien Criminal and Civil Solicitors) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Fairfax Media Publications Pty Ltd v Voller Nationwide News Pty Limited v Voller Australian News Channel Pty Ltd v Voller Defamation – Publication – Where appellants were media companies – Where each appellant created, operated and maintained public Facebook page – Where each appellant created posts on Facebook page hyperlinking to news stories referring to respondent – Where third-party Facebook users left "comments" on appellants' posts – Where comments alleged to be defamatory of respondent – Whether appellants "publishers" of comments – Whether communicate defamatory matter necessary for appellants to be publishers. intention Words and phrases – "communication of defamatory matter to a third party", "defamation", "digital newspaper or broadcast", "encouraged and facilitated", "Facebook comments", "Facebook page", "innocent dissemination", "intention to publish defamatory matter", "internet platform providers", "participation", "participation in the process", "publication", "publisher", "rebuttable presumption of publication", "strict liability", "third party". Defamation Act 2005 (NSW), s 7(2). KIEFEL CJ, KEANE AND GLEESON JJ. The appellants, Fairfax Media Publications Pty Ltd, Nationwide News Pty Limited and Australian News Channel Pty Ltd, publish newspapers which circulate in New South Wales or operate television stations, or both. They each maintain a public Facebook page on which they post content relating to news stories and provide hyperlinks to those stories on their website. They invite comment on the posted content from members of the public who are Facebook users. Comments which are made appear on the Facebook page and are available to be seen by other Facebook users. In each of the three proceedings brought in the Supreme Court of New South Wales, the respondent claimed that following the appellants posting about particular news stories referring to him, including posts concerning his incarceration in a juvenile justice detention centre in the Northern Territory, a number of third-party Facebook users responded with comments that were defamatory of him. He alleged that the appellants were liable as the publishers of those comments. The parties agreed to the terms of a question concerning the issue of publication. The Supreme Court ordered that the question be decided separately from the balance of the proceedings1. The question was whether the respondent, the plaintiff in the proceedings, "has established the publication element of the cause of action of defamation against the defendant[s] in respect of each of the Facebook comments by third-party users". The appellants took the view that a negative answer to the separate question would result in dismissal of the proceedings. The primary judge (Rothman J) answered the separate question in the affirmative2. Each of the appeals from that decision was dismissed3. Background facts The appellants each maintain a public Facebook page on terms of use agreed with Facebook. The page is used by each appellant to share content and connect with Facebook users. The page is publicly accessible to users, who are able to view and comment on content posted to that page. 1 Uniform Civil Procedure Rules 2005 (NSW), r 28.2. 2 Voller v Nationwide News Pty Ltd [2019] NSWSC 766. 3 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700. The use by each appellant of their Facebook page usually involves the posting of a hyperlink to a news story, with a headline, a comment and an image. Clicking on the hyperlink takes the reader to the full story on an appellant's news website. Readers are invited, by options which appear under the post, to "Like", "Comment" on or "Share" the post. These options are standard features of a Facebook page. Comments which are made by users appear on the page and are available to be seen by all Facebook users who can see the page. The Facebook page used by each appellant is managed by a Page administrator, the person or persons authorised by the appellant to administer it in accordance with Facebook's terms of use. There was evidence before the primary judge, which was largely uncontentious, that an administrator could prevent, or block, the posting of comments by third parties through various means, although the Facebook platform did not allow all posts on a public Facebook page to be blocked. Individual comments could be deleted after they were posted but this would not prevent publication. It was possible to "hide" most comments, through the application of a filter, which would prevent publication to all except the administrator, the third-party user who posted the comment and their Facebook "friends". Hidden comments could then be individually assessed by an administrator. If sufficient staff were allocated to perform this task, comments could be monitored and un-hidden if approved by an administrator. The primary judge found, as might be anticipated, that certain posts would be expected to draw adverse comments about the person who was the subject of the news story. It was not in dispute that the use of a Facebook page encourages and facilitates visits by third-party users to a media outlet's own website. The number of comments is an important aspect of the use of a public Facebook page, because comments increase the profile and popularity of the page, which in turn increases the readership of the digital newspaper or broadcast, and the revenue from advertising on both the page and the digital newspaper or broadcast. The Defamation Act 2005 (NSW) Section 6 of the Defamation Act 2005 (NSW) states the subject matter of the Act to relate to "the tort of defamation at general law". It provides that the Act "does not affect the operation of the general law in relation to the tort of defamation except to the extent that this Act provides otherwise (whether expressly or by necessary implication)". Provisions of the Act refer to the "publication of defamatory matter"4. "Matter" is relevantly defined5 to include an article, report or other thing communicated by means of a newspaper and a report or other thing communicated by means of television, the internet or any other form of electronic communication. The Act does not define what is meant by the "publication" of defamatory matter. Resort is necessary to the general law in that regard. The Defamation Act makes provision, in s 32, for a defence of innocent dissemination. A defence of this kind has its origins in the common law. No question as to the availability of the statutory defence arises with respect to the answer to the separate question. Nevertheless, the appellants refer to the cases which developed the defence at common law and later observations about those cases. The appellants submit that the cases illuminate what it means to be a publisher. The argument and decision below The appellants argued their cases in the Court of Appeal on the basis that, to be publishers, they must have been instrumental to, or a participant in, the communication of the alleged defamatory matter. This was a correct approach and followed the meaning of publication given in Webb v Bloch6, to which reference is made later in these reasons. The appellants argued that they did not make the defamatory comments available to the public, did not participate in their publication and were not in any relevant sense instrumental in their publication7; they merely administered a public Facebook page on which third parties published material. They submitted to the Court of Appeal that they were more closely equivalent to the supplier of paper to a newspaper owner or the supplier of a computer to an author. Reliance was also placed by the appellants on cases which involved actions brought against owners or occupiers of premises in which unauthorised third See, for example, s 8, s 32. (1928) 41 CLR 331 at 363-364. 7 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 712 [45]. parties affixed defamatory statements on the wall of a premises8 or scrawled them as graffiti on the walls of a structure9. In cases of this kind the occupier has been regarded by the courts as a publisher only if, after becoming aware of the statements, the occupier allowed them to remain in place and the circumstances justified an inference that they had accepted responsibility for the continuing publication of the statement by adopting or ratifying it. In a case to which reference was made in the judgments in the Court of Appeal10 it had been held that internet platform providers which hosted a discussion forum were in a different position from the occupiers referred to in those cases. Unlike the occupiers, the providers had encouraged and facilitated postings by members of the forum and were therefore held to be participants in their publication from the outset11. Basten JA accepted that the appellants played no such active role, distinguishing them from the internet platform providers in that case, but nevertheless considered the appellants to be publishers, as did Meagher JA and Simpson A-JA12. Each of their Honours pointed to the appellants having facilitated the making of comments by third parties which then became available to others. Meagher JA and Simpson A-JA pointed out that the appellants invited and encouraged comments from Facebook users and provided the vehicle for publication to those who might avail themselves of it. Their Honours upheld the primary judge's answer to the separate question, that the plaintiff had established the element of publication. After finding the appellants were publishers, the primary judge went on to consider aspects of the defence of innocent dissemination under s 32 of the Defamation Act. But as the appellants pointed out in the Court of Appeal, that issue did not arise in relation to the separate question. There was some discussion in the judgments in the Court of Appeal as to whether the cases which developed the 8 Byrne v Deane [1937] 1 KB 818. 9 Urbanchich v Drummoyne Municipal Council (1991) Aust Torts Reports ¶81-127. 10 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366. 11 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 12 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 712 [47], 724- defence at common law hold that if the defence is made out there is taken to have been no publication by a defendant13. But as Meagher JA and Simpson A-JA observed14, such a question was not relevant because the appellants placed no reliance on the "never published" principle. It will be observed that the position of the appellants has now changed. The appellants' contentions The appellants now contend that the common law requires that the publication of defamatory matter be intentional. It is not sufficient that a defendant merely plays a passive instrumental role in the process of publication. To be a publisher a person must intend to communicate the matter complained of, which is to say the relevant words. This is said to follow from what was said by Isaacs J in Webb v Bloch15 and to accord with the holding in Trkulja v Google LLC16, that Google's intentional participation in the communication of the defamatory matter supported a finding of publication. As mentioned earlier in these reasons, the appellants do not rely on the statutory defence of innocent dissemination as providing an answer to whether they are publishers of the alleged defamatory material. However, they submit that the cases which concern the common law defence of innocent dissemination, commencing with Emmens v Pottle17, support a requirement of intention to publish defamatory matter. They submit that the cases show that publication is more than mere dissemination. Publication is dissemination with an element of intention. The approach of the courts in these cases, the appellants say, is not to regard publication as having occurred and then excuse the defendant from liability if the defence is made out. It is to allow the defendant to demonstrate that there was no publication. The cases treat publication as an evidentiary presumption which is rebuttable on proof of the requirements of the defence, relevantly a lack of knowledge that the matter being communicated is defamatory or a lack of intention to communicate it. Including by reference to Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288 and Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 585-586. 14 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 721 [93]. (1928) 41 CLR 331 at 363-364. (2018) 263 CLR 149 at 163 [38]. (1885) 16 QBD 354. A focus on the intention of a putative publisher to communicate the matter complained of is also said to explain the cases concerning whether occupiers are publishers of defamatory statements affixed to their premises or structures by unauthorised third parties, the appellants contend. These cases hold that, to be a publisher, an occupier must have consented to, approved of, adopted or promoted the continued presence of the statements, such that it can be said the occupier accepted responsibility for their presence. The question of publication is therefore determined by the courts by drawing an inference that the occupier intends to communicate the matter, the appellants contend. No such deliberate act is present in these appeals which would permit an inference of intention on the part of the appellants to be drawn, it is submitted. The appellants' contentions are not supported by authority and cannot be accepted. Publication and intention In the law of defamation, harm is understood to be occasioned to a person's reputation when a defamatory publication is made to a third party. Publication is the actionable wrong. In Dow Jones & Co Inc v Gutnick18, publication was described as a bilateral act by which the publisher makes the defamatory material available and a third party has it available for their comprehension. Publication may therefore be understood as the process by which a defamatory statement or imputation is conveyed19. In Trkulja v Google LLC20, it was said that "[i]n point of principle, the law as to publication is tolerably clear". The judgment of Isaacs J in Webb v Bloch21 was cited for that proposition. In that case, Isaacs J drew upon texts to identify who may be a publisher. Folkard22 described the word "published" as a technical term in the law of libel. It is used, he said: (2002) 210 CLR 575 at 600 [26]. 19 Rolph, Defamation Law (2016) at 140 [8.20]. (2018) 263 CLR 149 at 163 [39]. (1928) 41 CLR 331 at 363-364. 22 Folkard, The Law of Slander and Libel, 5th ed (1891) at 439 (emphasis added by Isaacs J). "without reference to the precise degree in which the defendant has been instrumental to such publication; since, if he has intentionally lent his assistance to its existence for the purpose of being published, his instrumentality is evidence to show a publication by him". Starkie23 said that all persons who: "are in any degree accessory to the publication of a libel, and by any means whatever conduce to the publication, are to be considered as principals in the act of publication". Part of the quotation from Folkard ("has intentionally lent his assistance to its existence for the purpose of being published") is relied on by the appellants as supporting their argument that for a person to be a publisher they must know of the relevant defamatory matter and intend to convey it. The argument is inconsistent with the common law rule relating to publication and, as shall be explained, it derives no support from what was said in Webb v Bloch. An action for defamation does not require proof of fault. Defamation is a tort of strict liability, in the sense that a defendant may be liable even though no injury to reputation was intended and the defendant acted with reasonable care24. The intention of the author of the defamatory matter is not relevant25 because the actionable wrong is the publication. It is often persons other than the author who are liable as publisher. A publisher's liability does not depend upon their knowledge of the defamatory matter which is being communicated or their intention to communicate it. The liability of a person as a publisher "depends upon mere communication of the defamatory matter to a third person", Dixon J said26 in Lee v Wilson & Mackinnon. No question as to the knowledge or intention of the publisher arises. His Honour said "[t]he communication may be quite unintentional, and the the person publisher may be unaware of the defamatory matter", but 23 Starkie, A Treatise on the Law of Slander and Libel, 2nd ed (1830), vol II at 225 (emphasis added by Isaacs J). 24 Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 600 [25], referring to Lee v Wilson & Mackinnon (1934) 51 CLR 276. 25 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 287 per Dixon J. (1934) 51 CLR 276 at 288. communicating the defamatory matter will nevertheless be liable. The exception identified by his Honour was the case of certain booksellers, news vendors and messengers, to which reference will later be made. The appellants' argument that a person must intend to publish the defamatory matter gains no support from what was said in Trkulja v Google LLC27. On an application for summary dismissal of the plaintiff's claim of defamation, the primary judge had held that it was strongly arguable that Google's "intentional participation" in the communication of the alleged defamatory material to users of the Google search engine supported a finding that Google was a publisher28. This Court upheld that finding, but criticised the intermediate appellate court for proceeding to make a determinative finding as to publication29. The issue concerning publication required consideration of "the nature and extent of Google's involvement in the compilation and publication of its search engine results", the Court said, and this could not be known with any certainty until after discovery30. Adopting the quotation in Webb v Bloch from Folkard, the Court said that "all degrees of participation in the publication" of defamatory matter are publication31. Far from supporting the appellants' argument as to intention, Trkulja v Google LLC confirms that the correct meaning of publication, which was given in Webb v Bloch, is that any act of participation in the communication of defamatory matter to a third party is sufficient to make a defendant a publisher. Putting to one side the exception created by the defence of innocent dissemination, the publication rule has always been understood to have a very wide operation. In Crookes v Newton32, a decision of the Supreme Court of Canada, Abella J remarked that "the breadth of activity captured by the traditional publication rule is vast". Her Honour gave as an example a case in which a printer's employee, whose only role in a publication was to "clap down" the printing press, (2018) 263 CLR 149 at 163 [38]. (2018) 263 CLR 149 at 158 [25]. (2018) 263 CLR 149 at 163 [38]. (2018) 263 CLR 149 at 164 [39]. (2018) 263 CLR 149 at 164 [40]. [2011] 3 SCR 269 at 281-282 [18]. was held liable for the libels contained in the publication even though he was unaware of its contents33. Consistently with Trkulja v Google LLC and the publication rule, Webb v Bloch is to be understood to say that a person who has been instrumental in, or contributes to any extent to, the publication of defamatory matter is a publisher. All that is required is a voluntary act of participation in its communication. True it is that that part of the quotation from Folkard on which the appellants rely ("has intentionally lent his assistance to its existence for the purpose of being published") refers to something other than a publication by distribution. That circumstance was apposite to the facts in Webb v Bloch and the issue with which Isaacs J was dealing in the passages which preceded his discussion about publication. In Webb v Bloch, the solicitor enlisted by the defendants both composed the defamatory circular "for the purpose of publication" and subsequently "consciously distributed it", Isaacs J found34. The latter finding points to the fact that it is the defendant's act of participation in publication which must be intentional, in the sense of being voluntary. Because the solicitor had participated from the outset, his publication of the libel was found by Isaacs J35 not to consist merely in the distribution of the circular which contained the libel. The conclusion which was then available was that the solicitor was not a subordinate, but rather a primary, publisher for the purposes of the defence of innocent dissemination. Isaacs J in Webb v Bloch may be understood to acknowledge that publication may involve acts of participation other than, and which may precede, the actual physical distribution of the defamatory material. His Honour is not to be understood to say that a person must intend to communicate the material complained of as defamatory in order to be a publisher. 33 R v Clerk (1728) 1 Barn KB 304 [94 ER 207]. (1928) 41 CLR 331 at 363. (1928) 41 CLR 331 at 363. Innocent dissemination As Ribeiro PJ observed in Oriental Press Group Ltd v Fevaworks Solutions Ltd36, "[t]he strictness of the publication rule plainly called for some relaxation". Emmens v Pottle37 is generally taken as the starting point of what came to be called the common law defence of innocent dissemination, which was developed by the courts to mitigate the harshness of the law relating to publication. Vizetelly v Mudie's Select Library Ltd38 took up the new "doctrine"39. Emmens v Pottle concerned persons in the business of selling newspapers. Lord Esher held40 that although such a person may be prima facie liable as a publisher, if they are able to show that they did not know that the newspaper was likely to contain a libel and their lack of knowledge was not the result of their own negligence they will not be liable for the libel41. Vizetelly involved a circulating library. The "defence" also came to extend to persons who conducted the business of bookseller or messenger42. What they had in common was that they were mere distributors or disseminators. They were lesser or subordinate publishers, not primary publishers. The latter could not take advantage of the defence. The defence could be described as one special to distributors43. The defence cannot be said to be rooted in principle. In Thompson v Australian Capital Television Pty Ltd44, its origins were described as "muddied". (2013) 16 HKCFAR 366 at 379 [24]. (1885) 16 QBD 354. [1900] 2 QB 170 at 175 per A L Smith LJ. (1885) 16 QBD 354 at 356-357, Cotton LJ concurring. See also Bowen LJ at 358. (1885) 16 QBD 354 at 357. 42 See Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288 per Dixon J. 43 Gatley on Libel and Slander, 12th ed (2013) at 227 [6.30]. (1996) 186 CLR 574 at 586 per Brennan CJ, Dawson and Toohey JJ. The decision in Emmens v Pottle has been described as more pragmatic than principled45. Lord Esher appears to have been motivated by a concern that the common law would appear to be unjust and unreasonable if some such accommodation was not made by the courts. In Thompson46, it was said that his Lordship "rationalised rather than explained the decision". The appellants' argument that Emmens v Pottle and later cases treat publication as a mere rebuttable presumption relies on statements in Emmens v Pottle and Vizetelly concerning the relevant defendant's liability for publication. In Emmens v Pottle47, Lord Esher observed that the defendants were "primâ facie liable" because "[t]hey have handed to other people a newspaper in which there is a libel on the plaintiff". In Vizetelly, A L Smith LJ48 said that, the defendants having lent and sold copies of the book, "primâ facie they published it". These statements most clearly acknowledge the strictness of the publication rule in its operation. It is difficult to accept that by these words their Lordships intended to convert the rule to a rebuttable presumption of publication. Indeed the rule has continued to be regarded as operating strictly with respect to other publishers. The statements are better understood to say that but for the "defence" which the courts will now afford distributors, they would be liable as publishers. In Vizetelly49, A L Smith LJ, having observed that the defendants were "primâ facie" publishers, enquired "[w]hat defence, then, have they?" and answered "[n]one, unless they can bring themselves within the doctrine of Emmens v Pottle". The appellants also rely on what was said in the cases as to what followed where the defence was made out. In Emmens v Pottle50, Lord Esher said that if the defendants proved the necessary facts, namely lack of knowledge and absence of negligence, a conclusion might be reached that the defendants "did not publish the libel". His Lordship appears also to have distinguished the defendants as mere 45 Rolph, Defamation Law (2016) at 292 [14.20]. (1996) 186 CLR 574 at 585 per Brennan CJ, Dawson and Toohey JJ. (1885) 16 QBD 354 at 356-357. [1900] 2 QB 170 at 175. [1900] 2 QB 170 at 175. (1885) 16 QBD 354 at 357. "disseminators" who were innocent, in contradistinction to authors or other primary publishers. In Vizetelly51, Romer LJ did not suggest that the defence resulted in there being no publication in fact or law. His Lordship said that on proof of no knowledge and negligence a defendant may "be held not to have published" the libel. This might suggest that the court would deem a defendant not to be a publisher and, by that means, absolve them from liability. Recent decisions in the courts of the United Kingdom appear to have proceeded on this basis52. It may be accepted that if a plea by a defendant of "no publication" were established, a plaintiff would fail to establish a cause of action53. However, in contending for the conclusion that there was no publication, the appellants do not rely upon the "defence" as explaining this result. No mention of a "defence" was made in the judgments in Emmens v Pottle. The word has a number of meanings. It may simply mean the answer given to the plaintiff's claim, as the appellants point out. It is therefore unnecessary to consider historical questions of procedure further. The appellants rely on the apparent acceptance by Dixon J in Lee v Wilson & Mackinnon54 that the result of establishing the defence is that there is no publication. His Honour did not refer to Emmens v Pottle or to Vizetelly, but was no doubt conscious of them. He said that in cases involving booksellers, news vendors and the like, who neither know nor suspect the defamatory content, what would otherwise be publication "does not amount to publication of a libel". It must be accepted that his Honour repeated what had been said in the early cases. It is also necessary to observe that there was no issue in Lee v Wilson & Mackinnon as to the correctness of the statements in the early cases. The appellants also point to the repetition of Dixon J's words in a passage in the joint judgment in Dow Jones & Co Inc v Gutnick55. It needs to be borne in [1900] 2 QB 170 at 180. 52 Bunt v Tilley [2007] 1 WLR 1243 at 1252 [36]; [2006] 3 All ER 336 at 345; Tamiz v Google Inc [2013] 1 WLR 2151 at 2162 [26]. 53 Rolph, Defamation Law (2016) at 292 [14.20]. (1934) 51 CLR 276 at 288. (2002) 210 CLR 575 at 600 [25] per Gleeson CJ, McHugh, Gummow and Hayne JJ. mind that that case involved choice of law considerations referable to the act of publication of a defamation. Their Honours stated in general terms how the tort of defamation is understood in Australia to make the point that a defendant needs to be able to identify by what law publication may be judged. Their Honours were not concerned with whether the effect of the defence of innocent dissemination might be stated more accurately. And their Honours did not refer in that passage to the earlier decision of this Court in Thompson56. In Thompson57, Brennan CJ, Dawson and Toohey JJ observed that the plea of "never published" has introduced a "measure of confusion". Their Honours then referred, with apparent approval, to what the authors of Duncan and Neill on "It is submitted that it would be more accurate to say that any disseminator of a libel publishes the libel but, if he can establish the defence of innocent dissemination, he will not be responsible for that publication." Gummow J59, dealing with what his Honour described as the "so-called" defence, approved the statement of Sir Frederick Pollock60 that a person "is free from liability if he proves his ignorance". The views expressed by their Honours should be accepted as the explanation of what a successful "defence" of innocent dissemination achieves. It is not that publication is to be taken not to have occurred. In providing for the defence, the courts are to be understood simply to except from liability a defendant who would otherwise have been liable as a publisher. Such an approach was followed by the Hong Kong Court of Final Appeal in Oriental Press61. It accords with the fact that the common law continues to apply the rule of publication for (1996) 186 CLR 574. (1996) 186 CLR 574 at 586, referring to Gatley on Libel and Slander, 8th ed (1981) at 113, fn 3. 58 Duncan and Neill on Defamation, 2nd ed (1983) at 110, fn 3. 59 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 618-619. 60 Pollock's Law of Torts, 15th ed (1951) at 186. (2013) 16 HKCFAR 366 at 381 [31] per Ribeiro PJ (Ma CJ, Chan PJ and Gleeson NPJ agreeing), 409 [123], 410-411 [127], 412 [132] per Litton NPJ. publishers, other than innocent distributors or disseminators, who are not primary publishers. The other line of cases upon which the appellants rely commences with Byrne v Deane62. The appellants seek to draw from cases of this kind that an occupier may become liable as a publisher of a defamatory statement affixed to their premises if it may be inferred that they intended the publication to continue. Such an inference may be drawn where an occupier has consented to, adopted or approved the continuance of the publication. Byrne v Deane63 concerned the placing of an alleged defamatory verse on the wall of a golf club. The rules of the club required the consent of the Secretary to the posting of any notice in the club premises. The words were held to be incapable of a defamatory meaning. Nevertheless, some attention was directed by the Court of Appeal to the issue of publication. As Greene LJ pointed out64, publication is a question of fact which depends upon the circumstances of each case. A failure to remove defamatory material might amount to publication in some circumstances but not in others. Slesser LJ pointed to cases65 where persons who had taken no overt part in the publication of defamatory matter nevertheless adopted and promoted its reading so as to render themselves liable for its publication. Greer and Greene LJJ considered that there was evidence which tended to show that the actions of both defendants, as directors of the golf club, fell into this latter category. By electing to leave the alleged libel on the wall of the club, having had the power to remove it, they were taken to have consented to its continued publication to each member who saw it66. Slesser LJ on the other hand considered that the evidence only tended to show that the Secretary, by failing to exercise her [1937] 1 KB 818 at 837-838. 65 Such as Hird v Wood (1894) 38 Sol J 234: see [1937] 1 KB 818 at 834-835. [1937] 1 KB 818 at 830 per Greer LJ, 838 per Greene LJ. specific powers under the club rules, had promoted and associated herself with the continuance of the publication67. Cases such as Byrne v Deane68 do not establish a different rule for publication, one based upon the intention of occupiers, as the appellants contend. They involve the application of the general rule of publication to a particular set of circumstances where a person who has not participated in the primary act of publication may nevertheless become a publisher. The time when the occupier becomes aware of the publication of the material marks the point from which the occupier's conduct or inaction is assessed to determine whether they can be said to have participated in the continuing publication. Cases of this kind are not useful to explain the involvement of others in publications in very different circumstances69 and are not of assistance in this case. Conclusion and orders The Court of Appeal was correct to hold that the acts of the appellants in facilitating, encouraging and thereby assisting the posting of comments by the third-party Facebook users rendered them publishers of those comments. The appeals should be dismissed with costs. [1937] 1 KB 818 at 835. 68 See also Urbanchich v Drummoyne Municipal Council (1991) Aust Torts Reports 69 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 (internet platform providers); Murray v Wishart [2014] 3 NZLR 722 (hosts of a Facebook page). GagelerJ GAGELER AND GORDON JJ. The law of defamation in Australia illustrates the observation of Gleeson CJ in Brodie v Singleton Shire Council70 that: "Legislation and the common law are not separate and independent sources of law; the one the concern of parliaments, and the other the concern of courts. They exist in a symbiotic relationship." The two sources of law have been intertwined since the Slander and Libel Act 1847 (NSW) first abolished the common law distinction between libel and slander in New South Wales. They became more intertwined with the enactment of the Defamation Act 2005 (NSW) and legislation in substantially identical form in each other State and Territory71. That nationally uniform legislation is expressed "not [to] affect the operation of the general law in relation to the tort of defamation except to the extent that [it] provides otherwise"72 and to have as an object "to promote uniform laws of defamation in Australia"73. A task of the integrated Australian judiciary is to ensure that the nationally uniform statute law of defamation and the nationally uniform common law of defamation fit into a "coherent and interlocking whole"74. Subject to a range of potentially applicable statutory and common law defences, the tort of defamation is committed in Australia upon "the publication of defamatory matter of any kind"75. "Matter" is legislatively defined to include "a program, report, advertisement or other thing communicated by means of (2001) 206 CLR 512 at 532 [31]. 71 Defamation Act 2005 (Qld); Defamation Act 2005 (SA); Defamation Act 2005 (Tas); Defamation Act 2005 (Vic); Defamation Act 2005 (WA); Defamation Act 2006 (NT); Civil Law (Wrongs) Act 2002 (ACT), Ch 9. 72 See eg, s 6(2) of the Defamation Act 2005 (NSW). 73 See eg, Preamble to, and s 3(a) of, the Defamation Act 2005 (NSW). 74 cf Leeming, The Statutory Foundations of Negligence (2019) at 1, quoting Moses and Edgeworth, "Taking it Personally: Ebb and Flow in the Torrens System's In Personam Exception to Indefeasibility" (2013) 35 Sydney Law Review 107 at 111. 75 See eg, s 7(2) of the Defamation Act 2005 (NSW). GagelerJ television, radio, the Internet or any other form of electronic communication"76. "Publication" is left to have its meaning at common law. We agree with Kiefel CJ, Keane and Gleeson JJ that the Court of Appeal of the Supreme Court of New South Wales (Basten and Meagher JJA and Simpson A-JA)77 properly concluded that the primary judge (Rothman J)78 was right to answer questions reserved in defamation proceedings brought by the respondent to the effect that the appellant media companies were the publishers at common law of third-party comments posted on their public Facebook pages. To their Honours' reasons, we add the following observations. Publication and publishers at common law Put succinctly by Cardozo CJ79: "In the law of defamation, 'publication' is a term of art ... A defamatory writing is not published if it is read by no one but the one defamed. Published, it is, however, as soon as read by any one else." Publication for the purpose of the tort of defamation has been emphasised in Australia to be "a bilateral act – in which the publisher makes [matter] available and a third party has [that matter] available for his or her comprehension"80. Publication of matter by means of the Internet is accordingly complete when and where the matter is accessed by a third party in a comprehensible form. Adopted in Australia in the decision of this Court in Webb v Bloch81, and reconfirmed by the decision of this Court in Trkulja v Google LLC82, has been the long-standing rule of the common law that every intentional participant in a process directed to making matter available for comprehension by a third party is 76 See eg, s 4 of the Defamation Act 2005 (NSW). 77 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700. 78 Voller v Nationwide News Pty Ltd [2019] NSWSC 766. 79 Ostrowe v Lee (1931) 175 NE 505 at 505. 80 Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 600 [26]. (1928) 41 CLR 331 at 363-364. (2018) 263 CLR 149 at 164-165 [40]. GagelerJ a "publisher" of the matter upon the matter becoming available to be comprehended by the third party. The rule was captured in the reasons for judgment of Isaacs J in Webb v Bloch through the combination of two quotations from a specialist textbook, drawing on English case law stretching back to the Jacobean period. One of the quotations was from a chapter dealing with publication of a criminal libel in an early edition of the textbook, published in 183083: "According to the general rule of law, it is clear that all who are in any degree accessory to the publication of a libel, and by any means whatever conduce to the publication, are to be considered as principals in the act of publication: thus if one suggest illegal matter, in order that another may write or print it, and that a third may publish it, all are equally amenable for the act of publication, when it has been so effected." The other of the quotations was from a chapter dealing with publication of a civil libel in a revised edition of the textbook, published in 189184: "The term published is the proper and technical term to be used in the case of libel, without reference to the precise degree in which the defendant has been instrumental to such publication; since, if he has intentionally lent his assistance to its existence for the purpose of being published, his instrumentality is evidence to show a publication by him". In the form stated in the first quotation85, the rule might well have been explained as nothing more than a manifestation of the general rule of the common law that a secondary participant in a misdemeanour was liable as a principal given the refusal of the common law to "distinguish the different shades of guilt in petty misdemeanours"86. In the form stated in the second quotation, however, the rule is appropriately identified as an exposition of the technical content of "publication" when used as a term of art to express an element of the tort of defamation. 83 Starkie, A Treatise on the Law of Slander and Libel, 2nd ed (1830), vol II at 225, quoted in part in argument in Parkes v Prescott (1869) LR 4 Ex 169 at 173-174. 84 Folkard, The Law of Slander and Libel, 5th ed (1891) at 439 (emphasis in original). 85 See also Folkard, The Law of Slander and Libel, 5th ed (1891) at 796. 86 Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 3 at 36. See generally Giorgianni v The Queen (1985) 156 CLR 473 at 480-481, 490-493. GagelerJ The word "intentionally" within the second quotation should be understood to be directed at an intention to facilitate, or provide a platform for, communication of the allegedly defamatory matter. Enough for participation in a process that is in fact directed to making matter available for comprehension by a third party to be characterised as intentional is that the participation in the process is active and voluntary. That is irrespective of the degree of active and voluntary participation in the process. And it is irrespective of knowledge or intention on the part of the participant as to the defamatory content of the matter published. As Dixon J said in Lee v Wilson & Mackinnon87: "The cause of action consists in publication of the defamatory matter of and concerning the plaintiff. It might be thought, therefore, that, in any event, this warranted or required some investigation of the actual intention of the publisher. But his liability depends upon mere communication of the defamatory matter to a third person. The communication [of the defamatory matter] may be quite unintentional, and the publisher may be unaware of the defamatory matter." Adapting and adopting what was said with reference to Webb v Bloch in the Court of Final Appeal of Hong Kong in Oriental Press Group Ltd v Fevaworks Solutions Ltd88 by Ribeiro PJ (with whom other members of the Court including Gleeson NPJ agreed), a person is a publisher of defamatory matter if "by an act of the process" of any description" communicating the matter containing content conveying the defamatory imputation to a third party, regardless of whether the person knows that the matter contains that content. the person "intentionally assisted The strictness of the common law rule is illustrated by Webb v Bloch itself. There members of a committee who ratified a decision of another member to instruct a solicitor to prepare and send a circular were found each to have been a publisher of the circular prepared and sent out by the solicitor. That was despite some of them having been completely unaware of the contents of the circular. Consistent with the strictness of the common law rule, as was observed in the Supreme Court of Canada in Crookes v Newton89 by Abella J (with whom five other Justices concurred), "the breadth of activity captured by the traditional (1934) 51 CLR 276 at 288 (emphasis added). (2013) 16 HKCFAR 366 at 377 [19]. [2011] 3 SCR 269 at 281-282 [18]. GagelerJ publication rule is vast". The breadth of the activity is perhaps best illustrated by reference to a series of early eighteenth century English cases, the reports of which were noted in both editions of the textbook90 referred to in Webb v Bloch91, and one of which was singled out for mention by Abella J92. The cases concerned prosecutions for treasonable libel arising out of the publication in Mist's Weekly Journal of "The Persian Letter", in respect of which "it was shewn by proper averments and innuendos, that in a pretended piece of Persian history the king and several other members of the royal family had been libelled"93. The prosecutions were tried before Raymond CJ in the Court of King's Bench. Convicted as a publisher was a servant to the printer, whose only involvement was to "clap down the press" with "few or no circumstances [being] offered of his knowing the import of the paper"94. Convicted of printing, and escaping liability as a publisher only by reason of lack of evidence of publication of the pages printed, was a servant whose job as a compositor was limited to setting the type for printing the words in one of two columns on each page, another servant having the responsibility for setting the type for printing the words in the other column95. Escaping conviction altogether, but only through the merciful intransigence of the jury and the eventual capitulation of the Attorney-General, was the keeper of a "pamphlet shop" who lived more than a mile away and who had been bedridden for some time96. In response to a submission by her counsel that not "all those, through whose hands a libel goes, are publishers of it", Raymond CJ observed "that if a servant carries a libel for his master, he certainly is answerable for what he does, though he cannot so much as write or read"97. Formulated in the age of print, the common law rule was not seen to require modification in order to deal with the advent of the telegraph or the telephone. 90 Starkie, A Treatise on the Law of Slander and Libel, 2nd ed (1830), vol II at 188, 237-238, 341; Folkard, The Law of Slander and Libel, 5th ed (1891) at 830-831. (1928) 41 CLR 331 at 363-364. [2011] 3 SCR 269 at 282 [18]. 93 Starkie, A Treatise on the Law of Slander and Libel, 2nd ed (1830), vol I at 419. 94 R v Clerk (1728) 1 Barn KB 304 [94 ER 207]. 95 R v Knell (1728) 1 Barn KB 305 [94 ER 207]. 96 R v Nutt (1728) 1 Barn KB 306 [94 ER 208]. 97 R v Nutt (1728) 1 Barn KB 306 at 306-307 [94 ER 208 at 208]. GagelerJ When, in the late nineteenth century, an operator employed by a telegraph company at one place transmitted a customer's message to an operator employed by the same telegraph company at another place who then reduced the message to writing and delivered the message in print to the addressee, the telegraph company was as much a publisher of the printed message as was the customer98. When, in the late twentieth century, one person communicated with another by telephone, the telephone company was not a publisher. The difference was that "a telegram [was] sent only through the direct participation of agents of the telegraph company whereas in the case of a modern-day telephone call the caller communicate[d] directly with the listener over the facilities of the telephone company, with no publication by the company itself"99. Nor was the common law seen to require modification in order to deal with the advent of radio and television. Radio and television broadcasters were readily seen to be publishers of "all material broadcast or televised on [their] network, whether scripted or live" so as to be liable for defamatory matter contained in "a derogatory remark made by a contributor to a live studio discussion, or a banner or leaflet thrust before a television camera in a live transmission of a political meeting or demonstration". Not "to the point" was that the broadcaster "[did] not itself make or adopt the defamatory statements": "by its broadcast it [had] published them"100. Accordingly, in Thompson v Australian Capital Television Pty Ltd101, a television station which broadcast live to viewers in the Australian Capital Territory a current affairs program produced by another television station in Sydney was not doubted to be a publisher of defamatory statements made during a live interview on the program. The only relevant issue was whether it was entitled 98 eg, Lewis, Gatley on Libel and Slander, 8th ed (1981) at 104 [226], citing Peterson v Western Union Telegraph Co (1898) 71 Am St R 461. 99 Lunney v Prodigy Services Company (1998) 250 AD 2d 230 at 235 (cleaned up quote), referring to Anderson v New York Telephone Company (1974) 35 NY 2d 100 Mullis and Parkes (eds), Gatley on Libel and Slander, 12th ed (2013) at 216-217 [6.24], quoting United Kingdom, Report of the Committee on Defamation (1975) Cmnd 5909 at 82 [298]. 101 (1996) 186 CLR 574. GagelerJ to the common law "defence" of "innocent dissemination" associated with Emmens v Pottle102: it was not. Accepted by at least a majority in Thompson v Australian Capital Television Pty Ltd103 was the proposition that innocent dissemination at common law constitutes a "defence" to an action in defamation, in the strictest sense of the meaning of "defence"104 involving "confession" (meaning acceptance) of facts sufficient to establish the legal elements of the cause of action and "avoidance" (meaning negation or defeasance) of the legal effect of those facts upon proof of further facts establishing a justification or excuse, as distinct from involving the denial of facts sufficient to establish an element of the cause of action. Brennan CJ, Dawson and Toohey JJ, who constituted a majority, in that respect singled out for approval105 a comment, contained in the then current edition of a leading English textbook106, on the statement of Lord Esher MR in Emmens v Pottle that the innocent disseminators in that case "did not publish the libel"107. The comment was to the effect that "it would be more accurate to say that any disseminator of a libel publishes the libel but, if he can establish the defence of innocent dissemination, he will not be responsible for that publication". On the strength of Thompson v Australian Capital Television Pty Ltd, those drafting the Defamation Act and cognate legislation in other States and Territories proceeded on the understanding that an innocent disseminator is a publisher according to the common law of Australia108. In common law principle, not to 102 (1885) 16 QBD 354. 103 (1996) 186 CLR 574. 104 See Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 527-528 [8]; Perkins, Chitty's Treatise on Pleading, 16th American ed (1882), vol I at 551; Goudkamp, Tort Law Defences (2013) at 2-3. 105 (1996) 186 CLR 574 at 586. 106 Duncan and Neill on Defamation, 2nd ed (1983) at 110, fn 3. 107 (1885) 16 QBD 354 at 357. 108 See eg, New South Wales, Defamation Bill 2005, Explanatory Note at 15, cl 32; New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 13 September 2005 at 17640. GagelerJ mention on the authority of this Court, that understanding was fundamentally sound. Treating innocent dissemination as a defence to a cause of action in defamation rather than as a denial of the element of publication accords with the historical explanation of Emmens v Pottle given by Vaughan Williams LJ in Vizetelly v Mudie's Select Library Ltd109, to which Gummow J drew attention in his separate reasons for judgment in Thompson v Australian Capital Television Pty Ltd110. The explanation requires that Emmens v Pottle be understood against the background of the emergence of the tort of defamation out of the earlier action on the case for words over the course of the nineteenth century111. Only in the early twentieth century did the tort ultimately appear, from E Hulton & Co v Jones112 as explained by Dixon J in Lee v Wilson & Mackinnon113, as a "tort of strict liability"114 (in the sense that neither an intention to do harm nor negligence resulting in harm is necessary for liability115) in which "liability depends upon mere communication of the defamatory matter to a third person" without need to "look for the publisher's actual intention" as to the meaning of the matter116. Emmens v Pottle was decided at a stage in the evolution of the tort of defamation when the "gist" of a cause of action could still be said to be "malice" on the part of the defendant117. The typical pleading of an action in libel alleged that the defendant "falsely and maliciously printed and published of the plaintiff ... 109 [1900] 2 QB 170 at 178. 110 (1996) 186 CLR 574 at 619. 111 See Mitchell, The Making of the Modern Law of Defamation (2005) at 101-144; Mitchell, A History of Tort Law 1900-1950 (2015) at 140-144. 113 (1934) 51 CLR 276 at 287-292. 114 Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 600 [25]. 115 Benning v Wong (1969) 122 CLR 249 at 298-299. 116 (1934) 51 CLR 276 at 288. 117 Capital and Counties Bank v Henty (1882) 7 App Cas 741 at 767. GagelerJ the words following ..."118. By that stage, however, "malice" had long since come to be understood not in the "popular sense" of meaning "ill will against a person" but in the "legal sense" of meaning "a wrongful act, done intentionally, without just cause or excuse"119. On the basis that a defendant who published defamatory matter "must be considered, in point of law, to have intended the consequences resulting from that act"120, malice on the part of the defendant was presumed as a matter of law from the tendency in fact of the matter published to defame the plaintiff. The legal presumption of malice prevailed unless rebutted through the defendant establishing a justification or excuse for the publication. The rules of pleading applicable to the proceeding in Emmens v Pottle discouraged a defendant to an action in libel from simply pleading "denial of the several acts (or matters) complained of" by the plaintiff. The pleading rules instead encouraged a defendant who sought "to deny the fact of publication or the alleged reference to the plaintiff, to plead those denials specifically". They also had the effect that "a defendant in pleading a defence of privilege or justification must in general set out the facts on which [the defendant] relies to show that the publication was privileged or justified"121. In Emmens v Pottle, the successful defendants took both of those pleading options: they denied publication and, "further and alternatively", they pleaded the facts ultimately held to have made them innocent disseminators. Those additionally pleaded facts were specifically found by a jury. Judgment was ordered to be entered for the defendants from which an appeal by the plaintiff in person was dismissed by the Court of Appeal for very brief reasons delivered extempore. The explanation of Emmens v Pottle given by Vaughan Williams LJ in Vizetelly v Mudie's Select Library Ltd is that the case is best understood as having been decided on the second of the pleaded grounds of the defence, not the first. What the case decided, so the explanation went, was that proof that a publication of defamatory matter occurred in circumstances of innocent dissemination, not unlike proof that a publication occurred in circumstances of qualified or absolute privilege, amounted to establishment by the defendant of a justification or excuse 118 Bullen and Leake's Precedents of Pleadings, 4th ed, Pt I (1882) at 390. See also Jones v E Hulton & Co [1909] 2 KB 444 at 458, 477; E Hulton & Co v Jones [1910] AC 20 at 24. 119 Bromage v Prosser (1825) 4 B & C 247 at 255 [107 ER 1051 at 1054]. 120 Fisher v Clement (1830) 10 B & C 472 at 475 [109 ER 526 at 527]. See also Haire v Wilson (1829) 9 B & C 643 at 645 [109 ER 239 at 240]. 121 Bullen and Leake's Precedents of Pleadings, 4th ed, Pt II (1888) at 370-371, fn (b). GagelerJ which operated to rebut the presumption of malice and thereby to negate the tortious liability of the defendant for the publication. Thus, it could be said, inelegantly but without logical contradiction, that what occurred in Emmens v Pottle was a publication of defamatory matter that was nevertheless an "innocent publication of defamatory matter" and which was for that reason "not a publication within the meaning of the law of libel"122. The explanation accords with the report of the charge to the jury in Day v Bream123, to which Romer LJ alluded in Vizetelly v Mudie's Select Library Ltd as a case of innocent dissemination124. There the defendant was the porter at a coach office who delivered parcels of handbills defamatory of the plaintiff. The report of the case records that the trial judge125: "left it to the jury to say whether the defendant delivered the parcels in the course of his business without any knowledge of their contents; if so, to find for him, observing that prima facie he was answerable, inasmuch as he had in fact delivered and put into publication the libel complained of, and was therefore called upon to shew his ignorance of the contents". Even by the middle of the twentieth century, it remained common practice for a plaintiff in a defamation action to plead that the defendant published the allegedly defamatory matter with malice. But the allegation of malice could be said by then to have been "little more than a pleader's flourish or a survival of older ways"126, "intended as, if anything, an anticipatory rebuttal of every mode by which the defamatory matter might be sought to be 'protected, or justified, or excused by law'"127. 122 [1900] 2 QB 170 at 178. 123 (1837) 2 M & Rob 54 [174 ER 212]. 124 [1900] 2 QB 170 at 179. 125 (1837) 2 M & Rob 54 at 56 [174 ER 212 at 212]. 126 Australian Consolidated Press Ltd v Uren (1966) 117 CLR 185 at 204. 127 Motel Holdings Ltd v The Bulletin Newspaper Co Pty Ltd [1963] SR (NSW) 208 at GagelerJ Proof by the defendant of a justification or excuse, which when Emmens v Pottle was decided and for some time afterwards128 might still have been thought to operate to defeat the tortious liability of the defendant by negativing the presumption of malice, had been freed through the development of the common law by the middle of the twentieth century to be understood to operate to defeat the tortious liability of the defendant for the defamatory publication directly. The common law of Australia had by then in that way evolved to reflect the approach taken in the late nineteenth century in Queensland by legislation129 the effect of which was "to eliminate the element of malice ... and to substitute the principle that all defamation must be justified or excused"130. Such was the position at common law when Thompson v Australian Capital Television Pty Ltd was decided, and such is the position which the Defamation Act and cognate State and Territory legislation properly treat as the foundation for the legislative modifications they make to the common law. Further supporting that position is that, at least since Vizetelly v Mudie's Select Library Ltd, defendants relying on innocent dissemination have been liable in defamation unless they have succeeded in discharging the onus of proving innocent dissemination. Ribeiro PJ pointed out in Oriental Press Group Ltd v Fevaworks Solutions Ltd131 that acceptance of that liability is alone sufficient to indicate that "they must in principle be publishers, albeit in a subordinate role, for otherwise they could not be held liable at all since a fundamental constituent of the tort would be missing". That logic is reflected in the distinction drawn at common law and under statute132 between "primary" publishers, who cannot rely on innocent dissemination, and "subordinate" or "secondary" publishers, who can. 128 eg, Sun Life Assurance Co of Canada v W H Smith and Son Ltd (1933) 150 LT 211 129 Defamation Law of Queensland 1889 (Qld). 130 Hall-Gibbs Mercantile Agency Ltd v Dun (1910) 12 CLR 84 at 90. 131 (2013) 16 HKCFAR 366 at 381 [32]. 132 This distinction is now reflected in the additional statutory defence of innocent dissemination: see eg, s 32(2) of the Defamation Act 2005 (NSW), definition of "subordinate distributor". GagelerJ Statements are to be found in reasons for judgment of this Court before133 and after134 Thompson v Australian Capital Television Pty Ltd to the effect that a publication of defamatory matter shown by a defendant to have occurred in the ordinary course of the defendant's business in circumstances in which the defendant did not know or suspect and, using reasonable diligence, would not have known or suspected that the matter was defamatory "does not amount to publication of a libel". Those statements are best understood to refer to proof of innocent dissemination operating at common law to avoid tortious liability. Understood that way, the statements do not deny that the defendant was a publisher of the matter. The statements instead acknowledge that success by the defendant in proving innocent dissemination amounts to success in establishing a justification or excuse for the publication, the legal effect of which is to avoid tortious liability for the publication. The advent of the Internet has resulted in a "disaggregation" of the process of publication135 and has facilitated a shift from "one-to-many" publication to "many-to-many" publication136. That technological and sociological development has not been shown to warrant relaxation of the strictness of the common law rule associated with Webb v Bloch. Application of the strict common law rule as to publication, as has been emphasised, has long captured within the meaning of "publisher" all persons who have intentionally assisted in the process of publication. It is unsurprising, therefore, that statements can be found in some cases describing a publisher's liability for defamatory matter as arising by reason of the person "assisting and 133 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288. 134 Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 600 [25]. 135 Rolph, "Liability for the Publication of Third Party Comments: Fairfax Media Publications Pty Ltd v Voller" (2021) 43 Sydney Law Review 225 at 239. 136 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 390 [59], quoting Balkin, paper prepared for the "Global Constitutionalism Seminar 2010", Yale Law School, adapted from Balkin, "Media Access: A Question of Design" (2008) 76 George Washington Law Review 933. GagelerJ encouraging" another to do an act137, or that all those who contribute to publication of a libellous book are "joint tortfeasors in respect of the ultimate publication"138. Equally clear, however, is that the strictness of the common law rule ensures that all degrees of intentional participation in the process of publication constitute publication for the purposes of the law of defamation139. Unlike other areas of tort law or criminal law, where "mere assistance" or "mere similarity of design" may be insufficient to establish liability of an assister as a principal140, liability in defamation depends upon "mere communication" of the defamatory matter to a third person, provided the defendant intentionally participated to any degree in that process141. Two considerations strongly support maintenance of the strictness of the common law rule in Australia. The first is fidelity to the underlying concern of the common law of defamation to protect against damage to reputation, which should not be diminished as the threats to reputation are multiplied. The second is recognition that the balance that has been struck between freedom of communication by means of the Internet and protection of reputation is one that the Commonwealth Parliament (in enacting and maintaining the Broadcasting Services Act 1992 (Cth)142) and that State Parliaments and Territory legislatures (in enacting and maintaining and providing for review of143 the Defamation Act and cognate legislation) have determined for the time being to be appropriate against the background of the stable application of common law principle. 137 Webb v Bloch (1928) 41 CLR 331 at 364, quoting R v Paine (1696) 5 Mod 163 at 167 [87 ER 584 at 587]. 138 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 581. 139 Webb v Bloch (1928) 41 CLR 331 at 363-364; Trkulja v Google LLC (2018) 263 CLR 149 at 164 [40]. 140 cf Credit Lyonnais Bank Nederland NV (now Generale Bank Nederland NV) v Export Credit Guarantee Department [1998] 1 Lloyd's Rep 19 at 45-46, quoting The Koursk [1924] P 140 at 156. See also IL v The Queen (2017) 262 CLR 268 at 282 141 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288. 142 See cl 91 of Sch 5 to the Broadcasting Services Act. 143 See s 49 of the Defamation Act 2005 (NSW). GagelerJ Not unimportantly, continuing adherence to the strictness of the common law rule associated with Webb v Bloch also results in substantial conformity of the common law of Australia to the approach taken to resolving novel issues concerning publication of defamatory matter by means of the Internet in strongly reasoned common law decisions both of the Supreme Court of Canada in Crookes v Newton144 and of the Court of Final Appeal of Hong Kong in Oriental Press Group Ltd v Fevaworks Solutions Ltd145. To adapt an observation made by French CJ in Paciocco v Australia & New Zealand Banking Group Ltd146, given that a strength of common law reasoning lies in its ability to assimilate and build upon collective experience, when grappling with the application of common law principles of tortious liability inherited from a common source to meet common challenges presented by emerging global phenomena, "convergence ... is preferable to divergence even if harmonisation is beyond reach". Overseas cases The appellants referred to several overseas decisions which they argued to contain reasoning supporting their contention that intention to publish defamatory matter is required for a person to be a publisher. None of those decisions assists them. Tamiz v Google Inc147 was a decision of the Court of Appeal of England and Wales in which Google Inc was found not to have been the publisher at common law of allegedly defamatory comments posted anonymously on an independent blog created by an Internet user by means of its platform known as "Blogger.com". As Ribeiro PJ pointed out in Oriental Press Group Ltd v Fevaworks Solutions Ltd148, the decision proceeded "on the basis that successful invocation of the defence of innocent dissemination results in the defendant being deemed not to have published at all". For reasons already stated, that process of reasoning does not reflect the common law of Australia. 144 [2011] 3 SCR 269 at 281-283 [16]-[20]. 145 (2013) 16 HKCFAR 366 at 376-382 [16]-[33]. 146 (2016) 258 CLR 525 at 540 [10]. 147 [2013] 1 WLR 2151. 148 (2013) 16 HKCFAR 366 at 388 [53]. GagelerJ Monir v Wood149 was a subsequent decision of a single judge of the High Court of England and Wales in which it was noted with reference to an earlier decision of a single judge of that Court in Bunt v Tilley150 that the parties did not dispute the proposition that "for a person to be held liable as a primary publisher, s/he must be shown to have knowing involvement in the publication of the particular words". The appellants sought to unpack neither the meaning of the emphasised descriptor in the context of that case nor what might have been thought in the context of that case to be included in or excluded from the notion of "knowing involvement in the publication of the particular words". At least without considerably more analysis, invocation in argument of isolated statements of that kind does nothing to inform principled analysis. Murray v Wishart151 was a decision in which the New Zealand Court of Appeal held that an individual Internet user who was the administrator of a private Facebook page and who had no "actual knowledge" of the contents of third-party comments posted on the page was not liable in defamation. The Court of Appeal proceeded without reference to Webb v Bloch, and indeed without analysis of what constitutes publication at common law. Rather, the starting point for its analysis was that the issue of publication was to be determined by "strained analogy" with previously decided cases152. It appeared to assume that either actual or constructive knowledge of the defamatory content was necessary for publication153. Its ultimate conclusion that "the actual knowledge test should be the only test to determine whether a Facebook page host is a publisher"154 was reached having regard to the guarantee of freedom of expression in the New Zealand Bill of Rights Act 1990 (NZ). The reasoning does not reflect the common law of Australia. Crookes v Newton was a decision of the Supreme Court of Canada which, as already noted, expounded the common law rule about publication in terms consistent with Webb v Bloch155. The issue before the Supreme Court was whether 149 [2018] EWHC 3525 (QB) at [135] (emphasis in original). 150 [2007] 1 WLR 1243 at 1249 [22]-[23]; [2006] 3 All ER 336 at 342. 151 [2014] 3 NZLR 722 at 752 [144], 754 [155]. 152 [2014] 3 NZLR 722 at 745 [99]. 153 [2014] 3 NZLR 722 at 740 [81]-[82]. 154 [2014] 3 NZLR 722 at 752 [144]. 155 [2011] 3 SCR 269 at 281-283 [16]-[20]. GagelerJ the creation of a hyperlink in an article posted on a website, in and of itself, constituted publication of the content which an Internet user reading the article was able to access by clicking on the hyperlink. The Supreme Court found that a "mere" hyperlink did not engage the common law rule on the basis that the hyperlink was essentially a reference to other material rather than republication of that other material156. The conduct of the appellants in the present case, like the conduct of the respondents in Oriental Press Group Ltd v Fevaworks Solutions Ltd, was of a wholly different character. The appellants as publishers In Oriental Press Group Ltd v Fevaworks Solutions Ltd, not unlike in Thompson v Australian Capital Television Pty Ltd, the issue was not as to publication but as to whether the common law defence of innocent dissemination was available to the respondents, who administered a website which hosted an Internet discussion forum on which users posted defamatory matter. Before turning to resolve that issue, Ribeiro PJ said of the respondents157: "They were certainly publishers of those postings (and do not seek to argue otherwise) since they provided the platform for their dissemination, but the respondents were not aware of their content and realistically, in a many-to- many context, did not have the ability or opportunity to prevent their dissemination, having learned of them only after they had already been published by their originators." Except that the present appellants do "seek to argue otherwise", that description of the respondents in Oriental Press Group Ltd v Fevaworks Solutions Ltd is an apt description of the present appellants. Each appellant became a publisher of each comment posted on its public Facebook page by a Facebook user as and when that comment was accessed in a comprehensible form by another Facebook user. Each appellant became a publisher at that time by reason of its intentional participation in the process by which the posted comment had become available to be accessed by the other Facebook user. In each case, the intentional participation in that process was sufficiently constituted by the appellant, having contracted with Facebook for the creation and ongoing provision of its public Facebook page, posting content on the page the effect of which was automatically to give Facebook users the option (in addition to "Like" or "Share") to "Comment" on the content by posting a comment which (if not "filtered" so as to be automatically "hidden" if it contained 156 [2011] 3 SCR 269 at 289 [36]. 157 (2013) 16 HKCFAR 366 at 399 [89]. GagelerJ "moderated words") was automatically accessible in a comprehensible form by other Facebook users. Not to the point of the appellants having been publishers is the fact that: the appellants had no control over the facility by which the Facebook service was provided to them and to Facebook users; the "Comment" function was a standard feature of the Facebook service which the appellants could not disable; it was not possible for them to delete all comments in advance; or they could have effectively "hidden" all comments posted by Facebook users only by applying an extremely long list of common words as "moderated words". The primary judge found that over 15 million Australians are Facebook users158. The appellants chose to operate public Facebook pages in order to engage commercially with that significant segment of the population. The primary judge found that the "primary purpose" of the operation of each appellant's public Facebook page was "to optimise readership of the newspaper (whether hardcopy or digital) or broadcast and to optimise advertising revenue"159. Each appellant "provided the forum for its publication and encouraged, for its own commercial purposes, the publication of comments"160. Indeed, the primary judge found that161: "[t]he existence and number of comments ... from third-party users is an important (and, more probably than not, the most important) aspect of the public Facebook page, as it affects the Facebook algorithm and increases the profile of the Facebook page and the consequential popularity of the ... and augmenting Facebook page, advertising sales". increasing readership thereby Having regard to those findings, the appellants' attempt to portray themselves as passive and unwitting victims of Facebook's functionality has an air of unreality. Having taken action to secure the commercial benefit of the Facebook functionality, the appellants bear the legal consequences. 158 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [64]. 159 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [209]. 160 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [224]. 161 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [90(xvii)]. GagelerJ The conduct of the appellants is accordingly distinguishable from "graffitied wall" cases, such as Byrne v Deane162 and Urbanchich v Drummoyne Municipal Council163, in which issues have been raised about whether an owner of a building or noticeboard on which a defamatory statement was initially wrongfully affixed by a third party subsequently "consented to, or approved of, or adopted, or promoted, or in some way ratified, the continued presence of that statement ... so that persons other than the plaintiff may continue to read it"164. There is plainly a critical difference between that line of cases, involving defendants who have played no role in the facilitation of publication prior to becoming aware of the defamatory matter, and the present case. Where, as here, the operator of an "electronic bulletin board" posts material with the intention that third parties will comment on the material posted, the operator cannot escape being a publisher of the comments of those third parties. The most appropriate analogy is with live television or talkback radio. As Brennan CJ, Dawson and Toohey JJ recognised in Thompson v Australian Capital Television Pty Ltd, in the context of a live to air broadcast of a television program being simultaneously aired by another network, "the nature of a live to air current affairs program carries a high risk of defamatory statements being made"165 and such a program "by its nature would be likely to involve comments about persons"166. In sum, each appellant intentionally took a platform provided by another entity, Facebook, created and administered a public Facebook page, and posted content on that page. The creation of the public Facebook page, and the posting of content on that page, encouraged and facilitated publication of comments from third parties. The appellants were thereby publishers of the third-party comments. Conclusion The appeals should be dismissed with costs. 163 (1991) Aust Torts Reports ¶81-127. 164 Urbanchich v Drummoyne Municipal Council (1991) Aust Torts Reports ¶81-127 165 (1996) 186 CLR 574 at 590. 166 (1996) 186 CLR 574 at 590, quoting Thompson v Australian Capital Television Pty Ltd (1994) 54 FCR 513 at 520. Edelman Introduction Nationwide News Pty Ltd, one of the appellants, posts news items and images to a public Facebook page that it manages. The news items include hyperlinks to stories on the website for The Australian newspaper167. At the relevant time, Facebook did not permit the creators of Facebook pages to prevent any Facebook user from exercising an automatic option to "comment" on the publicly posted and hyperlinked news story. Suppose that Nationwide News published a link on its Facebook page to a mundane story about weather patterns and that a reader posted, in the space reserved for "comments" on the story, a defamatory remark that a particular named person was a thief. The remark was entirely unrelated to the weather story. Suppose, also, that at the time the remark was posted, Nationwide News had no knowledge of the remark, little or no ability to prevent it being made, and a system that would remove the remark as soon as Nationwide News became aware of it. Is Nationwide News a publisher of such a defamatory remark, which it neither invited nor requested, which it manifested no intention to publish, of which it was unaware, and which it would have removed as soon as reasonably possible? This question concerns the scope of the requirement in the Defamation Act 2005 (NSW), which reflects the common law in this respect, that a person must "publish" a statement to be liable for defamation. The question for determination on these appeals is expressed so broadly that it encompasses circumstances of this nature. Unlike the other members of this Court apart from Steward J, I do not accept that the appellants are publishers of such uninvited words written on their Facebook pages. It can be accepted that, in the circumstances of this case, Nationwide News intended that readers publish comments concerning the story it posted. But, in my respectful view, there is no meaningful sense in which it could be concluded that Nationwide News intended to publish remarks that were not, in any imaginable sense, a "comment" on the story. The remark described above would bear no more resemblance to invited "comments" on the posted story than defamatory graffiti on a commercial noticeboard would bear to invited notices on the commercial noticeboard. Neither satisfies the required intention for publication. Equally, the remark above would be no more an intended publication than a television broadcast which accidentally captures in the background an unknown stranger who, unbeknownst to the live presenter and camera operator, walks past wearing a t-shirt with a defamatory message or carrying a defamatory placard. 167 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 719 [85]. Edelman I have had the considerable benefit of reading in draft the reasons of Steward J, which conclude that the parties to these appeals erred in their assumption that the appellants either were publishers of all third-party comments on their respective Facebook pages or were not publishers of any of them. I agree with that conclusion. Steward J's comprehensive treatment of the factual background to this case and the authorities permits me to express my reasons below in relation to two further matters only, which illustrate the lack of principle for the assumption of the parties and the lack of justification for the assumption in any of the authorities upon which the parties relied. Intention to publish and strict liability in defamation Intention and fault Defamation is a tort of strict liability. This means that it is actionable, subject to defences, without proof of fault. The defendant must intentionally perform an act of publishing a communication, which is of and concerning the plaintiff168 and which is defamatory. Alternatively, if the defendant does not intentionally perform the act of publication then the defendant must assist in another's act of publication with a common intention to publish. In each case, the defendant must intend the act of publication. In each case, the relevant intention is an objective or manifested intention based upon the person's words or acts in the circumstances. The act of "publication" by the defendant of words or other communications about the plaintiff has a specific meaning in the law of defamation. It means "mere communication ... to a third person"169 or "making [the communication] known" to the third person170. The act must also be accompanied by an objective or manifested intention to act. The defamatory content of the communication "may be quite uninten[ded], and the publisher may be unaware of the defamatory matter"171 but there must be a manifested intention to make a communication to a third party. It can sometimes be a difficult exercise to determine whether intention to communicate has been manifested by a defendant. One sufficient, though not 168 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288. 169 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288. 170 Pullman v Hill & Co [1891] 1 QB 524 at 527. 171 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288. Edelman necessary, indicator is, in the words of Abella J in Crookes v Newton172, "exerting control over the content". A bookstore owner or a newspaper vendor will generally be a publisher because, having chosen the book or newspaper to be sold and having made the sale, they have manifested an intention to make the communication to a third party even if they are not aware of its contents. On the other hand, the need for an objective intention to communicate to a third party means that a cashier in a bookstore will not be a publisher. Nor will a mere courier or postal worker who delivers a defamatory publication, or a person who mistakenly "delivers one paper instead of another"173. This principle also explains why telephone companies and internet service providers who passively transmit have been held not to be publishers174. And it explains why the passive deliverer of a spare newspaper to a librarian, who "never intended to publish", was held not to be a publisher, unlike "[a] printer and publisher [who] intends to publish"175. In all of these instances of passive assistance, the basis for the conclusion is that there is no manifested intention to communicate any content. Of course, like distributors of books, television broadcasters have generally been held to be publishers of broadcast material, both scripted and live, irrespective of whether they are aware of the content of the broadcast. It suffices that they intend the communication, whatever its content. By contrast, it would be unprincipled if a television broadcaster – of, say, a weather programme – were found to be a publisher of material that was a "mere communication" that the broadcaster did not intend to publish. For instance, the example of a stranger who, unknown to the broadcaster, happened to be walking in the background with an entirely unrelated defamatory t-shirt or placard during a live public broadcast is a scenario in which the broadcaster would not be liable for defamation arising from 172 [2011] 3 SCR 269 at 285 [26] (emphasis in original). 173 R v Topham (1791) 4 TR 126 at 127-128 [100 ER 931 at 932]. 174 Anderson v New York Telephone Co (1974) 35 NY 2d 746 at 750; Bunt v Tilley [2007] 1 WLR 1243 at 1252 [36]-[37]; [2006] 3 All ER 336 at 345; Crookes v Newton [2011] 3 SCR 269 at 310 [89]. 175 McLeod v St Aubyn [1899] AC 549 at 562. Edelman such images, which the broadcaster did not "cho[o]se to present"176, having "merely provide[d] a vehicle"177. The element of an intention to publish that is required is concerned with an intention to act rather than with any of the consequences of the act. It is not a requirement of fault. In this respect, the intention required for the tort of defamation is no different in principle from the intention required for the torts of conversion, public nuisance, or trespass. In none of these torts is there a requirement of fault. As Professor Stevens has explained178, any intentional act of a person – whether it be destroying another's car, blocking the public highway, or walking on someone else's land – gives rise to prima facie liability as a tortfeasor even if the person was "wholly without fault" because they honestly and reasonably believed that the car was theirs, or honestly and reasonably believed that they had statutory authorisation to block the road, or honestly and reasonably believed that they had a right of way over the land crossed: "[i]t is unnecessary to show the intention to cause harm, or commit a wrong. ... [A]cting with the intention of exercising a liberty which [the defendant does] not have with respect to the claimant suffices." Fault in the publication element of the tort of defamation The liability for the tort of defamation, subject to defences, did not always fit this modern picture of strict liability. Historically, the elements of the tort of defamation required fault in some circumstances. For instance, some early cases appeared to treat a requirement of malice as an element of fault, rebuttably presumed179. But early in the 19th century that requirement of malice was replaced by an intention to perform the act. This shift occurred by reasoning that "[m]alice ... in its legal sense ... means a wrongful act, done intentionally, without just cause or excuse"180. 176 Australian Broadcasting Corporation v Comalco Ltd (1986) 12 FCR 510 at 521. 177 Buck v Jones [2002] NSWCA 8 at [60]. 178 Stevens, Torts and Rights (2007) at 101. 179 Mitchell, The Making of the Modern Law of Defamation (2005) at 101-102, citing Starkie, A Treatise on the Law of Slander, Libel, Scandalum Magnatum, and False Rumours (1813); Vanspike v Cleyson (1597) Cro Eliz 541 [78 ER 788]; Crawford v Middleton (1662) 1 Lev 82 [83 ER 308]; Wilson v Stephenson (1816) 2 Price 282 [146 ER 97]; Bromage v Prosser (1824) 1 Car & P 475 [171 ER 1280]. 180 Bromage v Prosser (1825) 4 B & C 247 at 255 [107 ER 1051 at 1054]. Edelman "innocently". The circumstances of Another instance in which fault was historically present in the elements of the tort of defamation was where the publication was by a person who was sometimes described as a secondary or subordinate publisher. A subordinate publisher was held not to have published the words if they could show that dissemination occurred "innocent dissemination" were relied upon heavily by the appellants on these appeals. An essential step in the appellants' submission that the publication element of the tort of defamation would not be established if they did not intend to publish particular content was based upon the common law doctrine of innocent dissemination operating to negate an element of the tort, namely the requirement of publication. In order to show why the appellants' reliance upon innocent dissemination as negating an element of the requirement of publication is misplaced, it is necessary to explain the evolution away from the historical requirement of fault in the elements of defamation, which Sir William Holdsworth described as a "chapter of accidents"181. The doctrine concerning "innocent dissemination" evolved from negating the publication element of the tort of defamation to being an independent defence to the completed tort. In that evolved state, the tort of defamation became a tort of strict liability, albeit with a defence based on lack of fault in limited circumstances. In the pleading language for an action on the case of the Hilary Term Rules of 1834, the doctrine of innocent dissemination had moved from a matter that the defendant could rely upon as the general issue, namely a blanket denial of the elements of the action by a plea of not guilty182, to a plea of specific justification by confession and avoidance, namely confession that the elements of the tort had been proved but avoidance of liability by an independent justification183. The treatment of the innocent dissemination doctrine as negating the element of publication was taken in the late 19th century decision of Emmens v Pottle184. In that case, the Court of Appeal of England and Wales upheld a jury 181 Holdsworth, "A Chapter of Accidents in the Law of Libel" (1941) 57 Law Quarterly Review 74. 182 See Chitty, A Practical Treatise on Pleading: and on the Parties to Actions, and the Forms of Actions (1809), vol 1 at 487-488. See also, generally, Taverner v Little (1839) 5 Bing (NC) 678 at 684-686 [132 ER 1261 at 1264]. 183 See Goudkamp, Tort Law Defences (2013) at 2, 7, 112. See also Goldsbrough v John Fairfax & Sons Ltd (1934) 34 SR (NSW) 524 at 531; Ibbetson, "Pleading Defences in Tort: The Historical Perspective", in Dyson, Goudkamp and Wilmot-Smith (eds), Defences in Tort (2015) 25 at 29-30. 184 (1885) 16 QBD 354. Edelman verdict for the defendants, concluding that, although the printer of a newspaper would be liable, a vendor of a newspaper was not liable where the vendor could establish that they acted in the ordinary course of business, not knowing, and without reasonable basis to know, that the newspaper contained any libellous matter. Lord Esher MR, with whom Cotton LJ agreed, said that it would be "unreasonable and unjust" to hold the vendor liable185. Bowen LJ also focused upon the "innocent" nature of the vendor186. This unreasonableness or innocence was not expressed as a defence independent of the elements for defamation. It was said to negate the element of publication. Lord Esher MR said that the defence arises when the "facts [show] that they did not publish the libel"187. His Lordship added: "If they had known what was in the paper ... they would have published the libel" but the findings of the jury that the defendants were innocent disseminators "make it clear that the defendants did not publish the libel"188. The decision in Emmens v Pottle was applied in Vizetelly v Mudie's Select Library Ltd189, in which the defendants were held liable for circulating copies of a book containing a libel. A L Smith LJ explained that the negligence of the defendants had precluded their discovery that the book contained a libel, so the defendants did not "do what the defendants in Emmens v Pottle ... succeeded in doing, namely, prove that they did not publish the libel"190. Vaughan Williams LJ agreed, adding that Emmens v Pottle had decided that innocent publication of a defamatory matter "is not a publication within the meaning of the law of libel"191. Romer LJ also saw the doctrine as one that negated publication, saying that the courts, in endeavouring to mitigate the hardship of strict liability, "have only been able to do so by holding that, under the circumstances of cases before them, there had been no publication of the libel by the defendant"192. He described Emmens v 185 (1885) 16 QBD 354 at 357-358. 186 (1885) 16 QBD 354 at 358. 187 (1885) 16 QBD 354 at 357. 188 (1885) 16 QBD 354 at 357. 190 [1900] 2 QB 170 at 177. 191 [1900] 2 QB 170 at 178. 192 [1900] 2 QB 170 at 179. Edelman Pottle as a case where "the result was that there was no publication"193. The plea of innocent dissemination was a plea of "never published"194. In Vizetelly v Mudie's Select Library Ltd195, whilst Romer LJ saw the result in Emmens v Pottle as working "substantial justice", he described the reasoning in the case as not being "altogether satisfactory". Similarly, Scrutton LJ said that it was "difficult to state exactly the principles" upon which the innocent dissemination doctrine led to a defendant's freedom from responsibility196. The doctrine was unsatisfactory and unprincipled for two reasons. First, it is difficult to see why innocent dissemination should negate publication by defendants who played a subordinate part in disseminating the work197 but not by defendants who were the "first or main publisher"198. If innocence in dissemination were a matter that negated publication, then it should equally negate the act of publication by both primary and subordinate actors. Secondly, the notion that innocent dissemination negated publication involved a fiction that a subordinate distributor of defamatory material, who was ignorant of the defamatory content and could not have discovered it with reasonable care, did not have an intention to make or provide a communication to a third party. The fiction that an absence of fault meant that a subordinate distributor did not intend to make a communication and hence did not "publish", even in circumstances where that intention was objectively apparent, was incompatible with any strict liability conception of the tort of defamation. The strict liability basis for defamation became firmly established by the "very new law"199 in the decision of the Court of Appeal, and subsequently the House of Lords200, in Jones 193 [1900] 2 QB 170 at 179. 194 O'Sullivan and Brown, The Law of Defamation (1958) at 39, fn 9. 195 [1900] 2 QB 170 at 180. 196 Bottomley v F W Woolworth and Co Ltd (1932) 48 TLR 521 at 521. 197 Ridgway v Smith and Son (1890) 6 TLR 275; Mallon v W H Smith and Son (1893) 9 TLR 621; Martin v Trustees of the British Museum and Thompson (1894) 10 TLR 198 Vizetelly v Mudie's Select Library Ltd [1900] 2 QB 170 at 180. 199 Pollock, "Note" (1910) 26 Law Quarterly Review 103 at 104. 200 E Hulton & Co v Jones [1910] AC 20. Edelman v E Hulton & Co201. As Holmes J had earlier said in dissent in Hanson v Globe Newspaper Co202, supporting the same strict liability conclusion that would later be reached in Jones v E Hulton & Co, "[t]he law constantly is tending towards consistency of theory". In that trend towards consistency of theory, the recognition of defamation as a tort of strict liability meant that the notion of innocent dissemination needed a new justification to survive. The shift from fault as an element of publication to an independent defence Although many writers supported the innocent dissemination principle in Emmens v Pottle as one that negated the element of publication203, some authors appeared to doubt whether the foundation of the innocent dissemination principle was a defendant's plea of an absence of a necessary element of the action rather than a defence in the true sense of confession and avoidance. In his first edition of The Law of Torts, published in 1887, although Pollock considered Emmens v Pottle in a section of his text entitled "What is publication"204, he described the defence as one which created a "free[dom] from liability" rather than one which involved a lack of publication. Likewise, Clerk and Lindsell wrote of innocent dissemination as an "excuse"205; Bigelow described it as an "immunity"206; Brett and, initially, Gatley described it as establishing an absence of liability rather than an absence of publication207. Even some of those, such as Odgers, who saw the 202 (1893) 159 Mass 293 at 302. 203 Fraser, The Law of Libel in its relation to the Press (1889) at 3; Ball, The Law of Libel as affecting Newspapers and Journalists (1912) at 19-20; Bower, A Code of the Law of Actionable Defamation, 2nd ed (1923) at 260; Fachiri, Principles and Practice of the Law of Libel and Slander, 6th ed (1925) at 29-31; O'Sullivan and Brown, The Law of Defamation (1958) at 38. 204 Pollock, The Law of Torts (1887) at 214-215. 205 Clerk and Lindsell, The Law of Torts (1889) at 442. 206 Bigelow, Elements of the Law of Torts, 5th ed (1894) at 97-98. 207 Brett, Commentaries on the Present Laws of England (1890), vol 1 at 458; Gatley, Law and Practice of Libel and Slander in a Civil Action with Precedents of Pleadings (1924) at 94-95. Edelman doctrine as an element of the action referred to the fiction or "deeming" involved in the negation of publication208. By 1977, there was therefore some support for the proposition, articulated by Bridge LJ, that the disseminator of defamatory material is liable, subject to the defence of innocent dissemination209. This treatment by Bridge LJ of innocent dissemination as a true defence to the completed elements of the tort of defamation was described in a footnote in an English text, referred to by Brennan CJ, Dawson and Toohey JJ in Thompson v Australian Capital Television Pty Ltd210, as supporting the proposition that "it would be more accurate to say that any disseminator of a libel publishes the libel but, if he can establish the defence of innocent dissemination, he will not be responsible for that publication". Despite some academic support and strong hints of judicial support, no Australian case has yet conclusively recognised that the foundations of "innocent dissemination" have shifted from being a negation of the element of publication to becoming a true defence to the completed cause of action. In 1934, Dixon J was still describing the circumstances of innocent dissemination as negating "publication of a libel"211. And the passing reference in the joint judgment of Brennan CJ, Dawson and Toohey JJ in Thompson v Australian Capital Television Pty Ltd, which was not endorsed by Gaudron J or Gummow J, who were the other two members of the Court in that appeal212, was far from an endorsement of a wholesale shift in the foundations of innocent dissemination213. The step of reorienting innocent dissemination from being a negation of an element of the cause of action for defamation to being an independent defence 208 Odgers, An Outline of the Law of Libel: Six Lectures Delivered in the Middle Temple Hall during Michaelmas Term, 1896 (1897) at 207. 209 Goldsmith v Sperrings Ltd [1977] 1 WLR 478 at 505; [1977] 2 All ER 566 at 587. 210 (1996) 186 CLR 574 at 586, quoting Duncan and Neill on Defamation, 2nd ed (1983) at 110, fn 3. See also Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 381 [31]. 211 Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288. 212 (1996) 186 CLR 574 at 594, 618. 213 Compare their Honours' statement that "an innocent subordinate disseminator does not intend to publish" at (1996) 186 CLR 574 at 588. Edelman should now be taken in Australia, as it has been taken in Hong Kong214. The reason to take this step is not merely the need for consistency of theory. It is also required as a matter of coherence in statutory interpretation. Shortly after the decision in Emmens v Pottle, statutory provisions were introduced in Queensland215 and Tasmania216. The statutory provisions were expressed in broader terms than innocent dissemination at common law, exempting from liability sellers who disseminated defamatory material without knowledge that the material contained defamatory words. The foundation upon which these innocent dissemination provisions were recognised was not clear. The provisions were not expressed as either a negation of publication or a defence to the completed elements of defamation. From 1958, however, the Defamation Act 1958 (NSW) treated innocent dissemination as a true defence. Section 10 provided that the "unlawful publication of defamatory matter is an actionable wrong". The modified innocent dissemination provisions were expressed as providing for a lack of criminal responsibility217, a lack of liability218, or a lack of responsibility219. A New South Wales Law Reform Commission report in 1971 observed that the protection afforded to innocent sellers of defamatory matter in New South Wales had modified "the common law by relieving the defendant of the onus of showing that his ignorance of the defamatory nature of the matter complained of was not due to his negligence"220. It also modified the common law by shifting the foundation of the defence from one which negated an element of the action to one that was a true, and independent, defence. The Defamation Act 2005 provides in s 6(2) that the Act "does not affect the operation of the general law in relation to the tort of defamation except to the extent that this Act provides otherwise (whether expressly or by necessary 214 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 215 Defamation Law of Queensland 1889 (Qld) (53 Vict No 12), s 33 excepting from criminal responsibility only. 216 Defamation Act 1895 (Tas) (59 Vict No 11), ss 32, 33. 217 Defamation Act 1958 (NSW), s 34. 218 Defamation Act 1958 (NSW), s 35. 219 Defamation Act 1958 (NSW), s 36. 220 New South Wales Law Reform Commission, Defamation, Report 11 (1971), Appendix D at [309]. Edelman implication)". Section 32 provides for the "Defence of innocent dissemination". That defence is expressed as, and intended as, a true defence, independent of the element of publication required for the completed tort. Against the background of statutory interference with and modification of the common law, the enactment of this defence in the Defamation Act 2005 replaced the common law plea of innocent dissemination, the foundation of which had been a negation of the publication element of defamation. As was observed in the Explanatory Note and Second Reading Speech for the Bill which introduced the Defamation Act 2005, the defence of innocent dissemination "largely" followed the general law221. Yet it did so by rationalising the common law in a coherent way, removing innocent dissemination from its operation in negating an element of the cause of action and creating it as a separate and true defence. In this case, s 32 has been pleaded but the only question before this Court concerns the content of the element of publication required for the completed tort. Attribution by assistance with a common intention to publish A defendant who does not perform any act of publication personally can still be liable for defamation on the basis of assisting another who performs the act of publication, provided that the defendant assists with a common intention to publish. Consistently with the general principles of the law of torts, assistance can be established by a minor act. A battery where the "one beats violently, and the other a little" involves a joint tort222. And for the tort of defamation it has been held to be sufficient to constitute assistance in an act of publication for a servant of the printer "only to clap down the press"223. However, throughout the law of torts and civil wrongdoing, mere assistance is not sufficient to establish liability of an assister as a principal. For instance, the mere manufacture and sale of equipment that assists in the infringement of intellectual property rights is not sufficient to make the manufacturer a principal in the commission of the copyright infringement224. Even acts of assistance with knowledge of another's intention to infringe is insufficient: the "vendor must have made himself a party to the act of infringement" in order to be liable as a 221 New South Wales, Defamation Bill 2005, Explanatory Note at 15; New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 13 September 222 Clark v Newsam (1847) 1 Ex 131 at 140 [154 ER 55 at 59]. 223 R v Clerk (1728) 1 Barn KB 304 at 304 [94 ER 207 at 207]. 224 See CBS Songs Ltd v Amstrad Consumer Electronics Plc [1988] AC 1013. Edelman principal225. Putting to one side instances of agency226, in Credit Lyonnais Bank Nederland NV (now Generale Bank Nederland NV) v Export Credit Guarantee Department227 Hobhouse LJ explained two other categories of case in which a person can make themself a party to the tort of another by assisting in the tort: "Mere assistance, even knowing assistance, does not suffice to make the 'secondary' party jointly liable as a joint tortfeasor with the primary party. What he does must go further. He must have conspired with the primary party or procured or induced his commission of the tort ... or he must have joined in the common design pursuant to which the tort was committed". Although Hobhouse LJ divided these instances of assistance into two categories – (i) conspiring, procuring, or inducing, and (ii) joining in a common design – those two categories substantially overlap. Both require acts of assistance or encouragement in the tort with a common intention or "design" to publish. Indeed, acts of conspiring, procuring, or inducing – or as Steward J more clearly expresses them, procuring, provoking, or conducing228 – the publication are the obvious means of proving a common intention or design. At the higher level of generality, these categories are all concerned with assistance or encouragement 225 Walker v Alemite Corporation (1933) 49 CLR 643 at 658. See also Townsend v Haworth (1875) 12 Ch D 831 (n); Dunlop Pneumatic Tyre Co Ltd v David Moseley & Sons Ltd [1904] 1 Ch 612 at 616-617, 620; Belegging-en Exploitatiemaatschappij Lavender BV v Witten Industrial Diamonds Ltd [1979] FSR 59 at 64, 66-67. See further Unilever Plc v Gillette (UK) Ltd [1989] RPC 583 at 608-609; Credit Lyonnais Bank Nederland NV (now Generale Bank Nederland NV) v Export Credit Guarantee Department [1998] 1 Lloyd's Rep 19 at 35, 46, 47; Fish & Fish Ltd v Sea Shepherd UK [2015] AC 1229 at 1239 [21]-[22], 1248 [55], 1249 [58]. 226 Cooley, A Treatise on the Law of Torts or the Wrongs which arise Independent of Contract, 2nd ed (1888) at 227-228. 227 [1998] 1 Lloyd's Rep 19 at 46. See also Douglas v Hello! Ltd [No 3] [2003] EMLR 228 See also Webb v Bloch (1928) 41 CLR 331 at 364, quoting Giffard QC in argument in Parkes v Prescott (1869) LR 4 Exch 169 at 173, in turn quoting Starkie, A Treatise on the Law of Slander and Libel, 2nd ed (1830), vol 2 at 225. Edelman pursuant to an "agreement or common design"229 or acting "in concert" with the tortfeasor230. The point is simply that like the criminal law231, with which the roots of torts are "greatly intermingled"232, where two or more people engage in tortious acts with a common design the acts of each are attributed to the other233. As Scrutton LJ explained in The Koursk234, "mere similarity of design on the part of independent actors, causing independent damage, is not enough; there must be concerted action to a common end". This is a general principle applicable to all torts and civil wrongs235. The same approach has naturally been taken in the law of defamation236. Hence, if a defendant does not personally perform an act of publication, the act of 229 Talacko v Talacko (2021) 95 ALJR 417 at 423 [25]; 389 ALR 178 at 184. 230 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 580-581. 231 IL v The Queen (2017) 262 CLR 268 at 282 [29]. 232 Gray v Motor Accident Commission (1998) 196 CLR 1 at 6 [11], quoting Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 149-150. 233 See Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 601-602, citing CBS Songs Ltd v Amstrad Consumer Electronics Plc [1988] AC 1013. See also Credit Lyonnais Bank Nederland NV (now Generale Bank Nederland NV) v Export Credit Guarantee Department [1998] 1 Lloyd's Rep 19 at 46; Vestergaard Frandsen A/S v Bestnet Europe Ltd [2013] 1 WLR 1556 at 1564-1565 [34]-[35]; [2013] 4 All ER 781 at 790-791; Fish & Fish Ltd v Sea Shepherd UK [2015] AC 1229 at 1244 [40]. 234 [1924] P 140 at 156, applied in Bourke v Jessop [No 3] [1935] NZLR 246 at 259-260; Nilon v Bezzina [1988] 2 Qd R 420 at 424; Myer Stores Ltd v Soo [1991] 2 VR 597 at 630. See also Unilever Plc v Gillette (UK) Ltd [1989] RPC 583 at 608-609; Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 580-581, 602; Fish & Fish Ltd v Sea Shepherd UK [2015] AC 1229 at 1242-1243 235 American Law Institute, Restatement (Second) of Torts (1979) at 315-318 §876(a)-(b). 236 Dar Al Arkan Real Estate Development Company v Al Refai [2013] EWHC 1630 (Comm) at [30]. See also Mullis and Parkes (eds), Gatley on Libel and Slander, 12th ed (2013) at 200-201 [6.11]. Edelman publishing by another can be attributed to the defendant if the defendant has assisted the other with a common intention to publish. In Webb v Bloch237, Isaacs J quoted a passage from R v Paine238, which compared the principles for responsibility for assistance in publication for the purposes of the tort of defamation with the principles for responsibility for assistance in the offence of murder: "If one repeat and another write a libel, and a third approve what is wrote, they are all makers of it; for all persons who concur, and show their assent or approbation to do an unlawful act, are guilty: so that murdering a man's reputation by a scandalous libel may be compared to murdering his person; for if several are assisting and encouraging a man in the act, though the stroke was given by one, yet all are guilty of homicide." The application of this principle to defamation means that the same rules that apply to an author of a book also apply to a printer, who does not perform the act of communication but assists with a common intention to publish. As Glanville Williams said239 in a passage cited with approval by Brennan CJ, Dawson and Toohey JJ in Thompson v Australian Capital Television Pty Ltd240: "[I]f A and B jointly write a book which in fact defames C, they are joint tortfeasors whether they realised that the book was defamatory or not. So also it seems that the journalist, compositor, printer, publisher and distributor of a libellous periodical are joint tortfeasors, at any rate in respect of the ultimate publication, since they are engaged in the joint enterprise of distributing the periodical to the public." The recognition that this general principle applies to the tort of defamation explains why the editors of Gatley on Libel and Slander241 treat the liability of persons who procure or participate in publication of a libel as questions of a "general principle" that "all persons who concur, and show their assent or 237 (1928) 41 CLR 331 at 364 (emphasis of Isaacs J). 238 (1696) 5 Mod 163 at 167 [87 ER 584 at 587]. 239 Williams, Joint Torts and Contributory Negligence (1951) at 10. 240 (1996) 186 CLR 574 at 581, fn 35. 241 Mullis and Parkes (eds), Gatley on Libel and Slander, 12th ed (2013) at 200-201 Edelman approbation to do an unlawful act, are guilty"242, citing cases involving breach of confidence, misrepresentation, harassment, trespass, and conversion. It is why Dr Collins argued in earlier editions of The Law of Defamation and the Internet that liability of procurers in defamation law should develop by reference to intellectual property cases concerned with the liability of persons who procure the commission of those wrongs243. And, it is why, as he observed in the latest edition, his prescient observation found favour in English cases244. When, then, will a defendant such as the appellants be a publisher on the basis that they have assisted another with a common design or common intention to publish the communication with that other person? Ultimately, the question must be answered in the circumstances of the particular case. In some circumstances, reasonable minds might differ as to whether an objective common intention can be found. For instance, the Court of Appeal of England and Wales divided in holding (by majority) that one of the two proprietors of a golf club premises had a common intention to publish a notice on the wall of their premises when, after a period of time had expired, he abstained from taking action while knowing of the notice, which could easily have been removed245. The proprietor's intention to publish was inferred from his consent "to [the notice's] publication to each member who saw it"246. The decision was later treated as one where the conduct of both proprietors involved republication of the libel247 by an inference that the publication had been adopted248. 242 Quoting R v Paine (1696) 5 Mod 163 at 167 [87 ER 584 at 587]. 243 Collins, The Law of Defamation and the Internet, 1st ed (2001) at 173-174 [15.36]; Collins, The Law of Defamation and the Internet, 2nd ed (2005) at 199 [15.38]. 244 Collins, The Law of Defamation and the Internet, 3rd ed (2010) at 106-107 [6.18], citing Bunt v Tilley [2007] 1 WLR 1243 at 1246 [10]; [2006] 3 All ER 336 at 339-340; Metropolitan International Schools Ltd v Designtechnica Corpn [2011] 1 WLR 1743 at 1752-1753 [40]-[41]; [2010] 3 All ER 548 at 557-558. 245 A second proprietor, who was also the secretary, was held to be liable by all members of the Court. 246 Byrne v Deane [1937] 1 KB 818 at 838. 247 Hellar v Bianco (1952) 244 P 2d 757 at 759. 248 Urbanchich v Drummoyne Municipal Council (1991) Aust Torts Reports ¶81-127 at 69,193; Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR Edelman The circumstances of this case The electronic medium of social media would not have been foreseen by the late 19th century and 20th century judges who applied the basic principles of the law of torts to the law of defamation. But those basic principles should not be distorted in their application to new media. The basic principles with which the question in this case is concerned are those relating to the requirement of an intention to publish. Whilst innocent dissemination can now be seen as a true defence, rather than a negation of the element of publication, a defendant cannot be liable for publication unless they intentionally perform the act of publication or assist another in the act of publication with a common intention to publish. It is just as true today as it was 150 years ago that, where a defendant requests another to publish a comment on a particular topic, the defendant will be liable for any defamation in the comment only to the extent that the publication was made "in pursuance of, and in accordance with, the request" and was not a departure from the request249. So too, if a defendant requests another generally to write a comment that turns out to be libellous then the defendant will be liable for "any libel written in pursuance of his request"250. In this case, the appellants assisted in the publication of third-party comments by creating their Facebook pages and posting news stories upon which third-party users could comment. However, by merely creating a page and posting a story with an invitation to comment on the story (an invitation which the appellants could not then disable), the appellants did not manifest any intention, nor any common purpose with the author of the comment, to publish words that are entirely unrelated to the posted story. Such unrelated words would not be in pursuance of, or in response to, the invitation. In circumstances in which (i) the appellants desired to optimise the readership of their disseminated material and (ii) comments upon the appellants' posts were consistent with their commercial purposes, the appellants had manifested an intention or common purpose to publish third-party comments on their links to published stories. The nature of the story that is posted and the circumstances in which it is posted – including the commercial nature of the publisher, the public nature of the Facebook page, and the lack of any expressed restriction upon comments – might also permit a conclusion that the appellants manifested an intention to invite a wide range of comments connected to the subject matter of the story. Provided that a comment that is written in response to the invitation is genuinely a comment on the story, the appellants will be publishers 249 Parkes v Prescott (1869) LR 4 Exch 169 at 177. 250 R v Cooper (1846) 8 QB 533 at 536 [115 ER 976 at 977], quoted with approval in Webb v Bloch (1928) 41 CLR 331 at 364. Edelman of that comment, irrespective of whether the appellants knew of, or could have known of, the comment at the time it was published. To return to the example with which these reasons began, a third-party comment on a story about the weather that disparaged the competence of the author of the story to predict the weather patterns would be sufficiently connected to the story to fall within the common intention that it be published by Nationwide News. A random remark by a third party, entirely unconnected with the weather story, that a particular person is a thief would not fall within any manifest common intention. In between these examples there might be difficult questions concerning the existence of a common intention. But such difficult questions have existed across the whole of the law of torts for more than a century. There is no basis in any of the evidence before the primary judge to conclude that by the (then mandatory) invitation to "comment" on their posted stories the appellants intended to publish remarks on anything and everything, however unrelated to the posted story. The "comment" button, which could not have been disabled, was not an invitation to third-party users to write any words about anything. The invitation to comment did not extend to third-party remarks whose connection with the subject matter of the posted story is so remote or tenuous that they could not meaningfully be described as a "comment" on the posted story. The appellants might have assisted in the author's act of publishing such remarks, but the appellants had no common purpose for the publication of such remarks, which were not, in any meaningful sense, "comments" on the posted story. Like Steward J, I would allow the appeals and answer the question stated in terms that are neither the universal negative answer proposed by the appellants nor the universal affirmative answer proposed by the respondent. There is also substantial overlap in our approaches. Indeed, as I have explained above, the concepts of procuring, provoking, and conducing publication, to which his Honour refers, involve assistance or encouragement with a common intention to publish. Depending on how broadly those concepts are applied, they may exhaust the universe of assistance with a common intention. In each appeal, I would allow the appeal in part, set aside paragraph 3 of the orders of the Court of Appeal of the Supreme Court of New South Wales and, in its place, order that: the appeal be allowed and paragraph 1 of the orders of the Supreme Court of New South Wales be set aside and, in its place, it be ordered that the question be answered as follows: The plaintiff will establish the publication element of the cause of action for defamation against the defendant in respect of each of the Facebook comments by third-party users by establishing that the Facebook comment has a connection to the subject matter posted by the defendant that is more than remote or tenuous. Steward STEWARD J. Fairfax Media Publications Pty Ltd ("Fairfax Media"), Nationwide News Pty Limited ("Nationwide News") and Australian News Channel Pty Ltd ("Australian News Channel") ("the appellants") have public Facebook pages onto which they make posts, normally by way of a comment, image or headline. Under each such post, a box automatically appears which offers three mechanisms of engagement: to "Like", "Comment" and/or "Share". Other Facebook users are thus given the opportunity to engage with the post by expressing approval (or disapproval) by using an emoji, or by commenting on or sharing the post. That opportunity is provided by Facebook's system, not the relevant Facebook page owner. The respondent claims that certain comments posted on the appellants' Facebook pages, by third-party Facebook users, defamed him. The ultimate issue for determination by this Court was posed as a separate question, namely, whether the respondent has established the publication element of the cause of action of defamation against the appellants in respect of each of the Facebook comments by third-party users. No party disputed that posting such comments constituted publication. Critically, the separate question assumed that the appellants were the publisher on their respective Facebook pages of either all third-party comments or none of them. For the reasons which follow, that assumption is incorrect. The competing contentions The respondent submits that any degree of participation in the process of communicating defamatory material, however minor, makes that participant a publisher. He relies on eight facts in support of the conclusion that each appellant here was a publisher of the third-party Facebook user comments. First, they initiated their respective Facebook pages. Secondly, they appointed their own page administrators to administer and monitor their respective Facebook pages. Thirdly, they maintained those Facebook pages on an ongoing basis. Fourthly, they selectively posted content, being links to stories on their digital news websites. Fifthly, they posted in a context where Facebook systems automatically and compulsorily required them to permit third parties to engage and interact with those posts. Sixthly, by maximising the number of such interactions, they served their respective commercial and financial interests. Seventhly, and by reason of the foregoing, they facilitated and encouraged third-party Facebook users to respond to each post. Finally, the preceding facts took place in a context where all posts and Facebook user comments would be viewable by and visible to anyone who visited the appellants' Facebook pages. No part of the respondent's case relies upon an ability or inability to delete or hide defamatory third-party comments after they have been made. His argument was that each appellant was a publisher of third-party comments from the moment they were posted. Steward The appellants contend that they were not the publishers of the relevant third-party comments because they did not intend to communicate their content. To be a publisher, it was said, there must be "knowing involvement" or "knowledge and control and inferred intention to directly engage" in the process of publication. No part of this test requires an intention to defame. But it does require an intention to publish the particular words; implicitly this requires knowledge of what is to be published. The appellants rely upon the following passage from Webb v Bloch, where Isaacs J described the act of publication in the following way251: "The meaning of 'publication' is well described in Folkard on Slander and Libel, 5th ed (1891), at p 439, in these words: 'The term published is the proper and technical term to be used in the case of libel, without reference to the precise degree in which the defendant has been instrumental to such publication; since, if he has intentionally lent his assistance to its existence for the purpose of being published, his instrumentality is evidence to show a publication by him.'" (emphasis of Isaacs J) In making the foregoing submission, the appellants highlighted a number of facts. They said that they have no capacity to remove or disable Facebook's automated box which invites public comment. They did not, and could not, have any prior knowledge of the content of resulting third-party comments. They claim to have a limited capacity to control the content of such comments. In that respect, the learned primary judge observed that the appellants have no ability to require third-party users to seek their approval prior to posting comments252; nor could they delete or edit third-party comments before they were posted253. To the extent that there was an automated Facebook mechanism to "hide" in advance third-party comments containing specified words (which could subsequently be "unhidden" and therefore be publicly viewable), such "hidden" comments could, at all times, be viewed by the third party's Facebook "friends". The appellants were also subject to Facebook's terms of use. They occasionally monitored some of the comments posted but considered it "onerous" or "impracticable" to monitor every comment. The appellants otherwise accepted that it was in their financial interests to seek high levels of engagement with Facebook users because the number of such visits 251 (1928) 41 CLR 331 at 363-364. 252 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [35] per Rothman J. 253 However, it was accepted that the appellants could, in advance, "block all comments on the public Facebook page", but the effect of this would be that "no comments could ever be made or seen and the process cannot be reversed": Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [29], [56], [90(iv)], [138] per Rothman J. is measured for the purpose of negotiating with potential advertisers. Thus, the primary judge observed that media organisations, including the appellants, are incentivised to make posts that are "noticeable and generate engagement"254. The respondent contends that there is no requirement to demonstrate an intention to publish as an element in the tort of defamation. He maintains that it is a tort of strict liability and relies upon the following passage from the reasons of Dixon J in Lee v Wilson & Mackinnon255: "The cause of action consists in publication of the defamatory matter of and concerning the plaintiff. It might be thought, therefore, that, in any event, this warranted or required some investigation of the actual intention of the publisher. But his liability depends upon mere communication of the defamatory matter to a third person. The communication may be quite unintentional, and the publisher may be unaware of the defamatory matter." The likelihood of an appellant's post resulting in defamatory or inappropriate third-party comment was the subject of cross-examination before the learned primary judge256. The appellants agreed that "controversial comments could occasionally (although rarely) be excited by wholly innocuous postings"257. In the case of Australian News Channel, it was found that it made no assessment of the likely reaction to its Facebook posts and that "nothing specific is done" for the risk of "intolerant and irresponsible" third-party comments258. That company's primary purpose of posting was to interest readers and have them gain access to its digital publications of the news259. In the case of one post about the respondent, Nationwide News accepted that the making of third-party defamatory comments 254 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [14] per Rothman J. 255 (1934) 51 CLR 276 at 288. 256 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [59] per Rothman J. 257 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [59] per Rothman J. 258 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [62], [64] per Rothman J. However, Australian News Channel did assess the risk associated with the content of particular stories on the persons featured as published on its digital news website: 259 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [60] per Rothman J. Evidence was also given of the same commercial purpose for Nationwide News and Fairfax Media: at [68], [79]. in response was a "'thoroughly predictable' result"260. In respect of another Facebook page administered by Nationwide News, it was agreed that a post concerning the respondent's story "was an emotive issue that could and did trigger very strong positions on both sides, including quite unreasonable positions"261. Ultimately, the primary judge made, amongst others, the following unchallenged factual findings262: "(xi) Certain initial posts by the media outlet would be expected to excite adverse comment about a person who is the subject of the post, including comment that is unreasonable, factually incorrect and damaging to the reputation of the person involved; (xii) The publications of these relevant original posts by the media companies (ie posts to which the comments alleged to be defamatory relate), if any assessment were to have been made (which it was not), would have been assessed as likely (ie more probably than not) to give rise to nasty and defamatory comments". The reference to "[c]ertain initial posts" is, it would appear, only to those posts which would reasonably be expected to provoke defamatory comments. Plainly, not all of the appellants' posts fell into this category. Relevance of intention Whilst it has been said that the tort of defamation is one of strict liability263, concepts of knowledge and control, and attributed knowledge and control, have long intruded. Four examples illustrate that proposition. First, appreciating the harshness of the application of the tort to a subsidiary publisher, the common law of defamation has recognised, from at least 1885, the 260 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [76]-[77] per Rothman J. Similarly, Australian News Channel accepted that one of its posts was "likely to provoke comments": at [61]. 261 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [84] per Rothman J. 262 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [90] per Rothman J. 263 See, eg, Lee v Wilson & Mackinnon (1934) 51 CLR 276 at 288 per Dixon J; Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 600 [25] per Gleeson CJ, McHugh, Gummow and Hayne JJ. defence of innocent dissemination264. This defence applies where a subsidiary publisher can show that they did not know, and by the exercise of reasonable care in all the circumstances could not have known, that the thing disseminated by them contained defamatory material265. The defence is now found in s 32 of the Defamation Act 2005 (NSW). Secondly, issues of knowledge and control are also relevant in determining whether a person is a subsidiary publisher or subordinate distributor (being the term used in the Defamation Act266), or a first or main distributor267. In the case of the Defamation Act, part of the test for being a subordinate distributor is whether a person had "any capacity to exercise editorial control over the content" of what had been published268. At common law, a person was a first or main publisher if she or he had sufficient knowledge and control over what was to be communicated269. As Ribeiro PJ said in Oriental Press Group Ltd v Fevaworks Solutions Ltd, a person will be a first or main publisher if270: "(i) ... [she or he] knows or can easily acquire knowledge of the content of the article being published (although not necessarily of its defamatory nature as a matter of law); and (ii) ... [she or he] has a realistic ability to control publication of such content, in other words, editorial control 264 Emmens v Pottle (1885) 16 QBD 354 at 357 per Lord Esher MR (Cotton LJ agreeing), 358 per Bowen LJ; Vizetelly v Mudie's Select Library Ltd [1900] 2 QB 170 at 176 per A L Smith LJ, 178 per Vaughan Williams LJ, 180 per Romer LJ. 265 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 380-381 [29] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 266 Defamation Act 2005 (NSW), s 32(2). 267 See, eg, Emmens v Pottle (1885) 16 QBD 354 at 357 per Lord Esher MR (Cotton LJ agreeing), 358 per Bowen LJ; Byrne v Deane [1937] 1 KB 818 at 830 per Greer LJ; Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 651-652 [193] per Callinan J; Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 380 [29] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 268 Defamation Act 2005 (NSW), s 32(2)(c). 269 See, eg, Emmens v Pottle (1885) 16 QBD 354 at 357 per Lord Esher MR (Cotton LJ agreeing). 270 (2013) 16 HKCFAR 366 at 394-395 [76] (Ma CJ, Chan PJ and Litton and involving the ability and opportunity to prevent publication of such content." Thirdly, knowledge of the content of a defamatory communication is also relevant to the Byrne v Deane271 line of cases. As Ribeiro PJ in Oriental Press also observed, those cases are authority for the following propositions272: "(a) Where a third person writes or affixes a statement defamatory of the plaintiff on the occupier's knowledge, the occupier is not treated as a publisher of that statement prior to [her or his] becoming aware of it. the occupier's property without (b) Once the occupier discovers its existence, [she or he] may be treated as a publisher but only if, having the power to do so, [she or he] does not remove or obliterate the offending statement in circumstances which justify inferring as a matter of fact that by [her or his] inaction [she or he] has consented to or ratified its continued publication. (c) Where the occupier becomes aware of the libel but the circumstances show that removal or obliteration is very difficult or very expensive, the fact that the defamatory statement is not expunged may well not justify the inference that it remains in place with [her or his] approval." Fourthly, a lack of control can be relevant in determining whether a person participated in the publication of third-party defamatory material. Crookes v Newton273 concerned Mr Newton's publication on his website of hyperlinks to third-party websites. Those other websites contained defamatory material concerning the appellants. The Supreme Court of Canada decided that Mr Newton had not published that defamatory material. His lack of control over the content of the other websites was important to the conclusion reached by the plurality. Abella J, delivering the judgment of Binnie, LeBel, Charron, Rothstein and Cromwell JJ and herself, reasoned that hyperlinks are just references and said274: "A reference to other content is fundamentally different from other acts involved in publication. Referencing on its own does not involve 271 [1937] 1 KB 818. See, eg, Urbanchich v Drummoyne Municipal Council (1991) Aust Torts Reports ¶81-127; Bishop v New South Wales [2000] NSWSC 1042. 272 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 385-386 [44] (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 273 [2011] 3 SCR 269. 274 Crookes v Newton [2011] 3 SCR 269 at 285 [26]. exerting control over the content. Communicating something is very different from merely communicating that something exists or where it exists. The former involves dissemination of the content, and suggests control over both the content and whether the content will reach an audience at all, while the latter does not. Even where the goal of the person referring to a defamatory publication is to expand that publication's audience, his or her participation is merely ancillary to that of the initial publisher: with or without the reference, the allegedly defamatory information has already been made available to the public by the initial publisher or publishers' acts. These features of references distinguish them from acts in the publication process like creating or posting the defamatory publication, and from repetition." (emphasis added) The plurality was of the view that its conclusion accorded with the "dramatic transformation in the technology of communications"275. And, further, it avoided a "potential 'chill' in how the Internet functions ... since primary article authors would unlikely want to risk liability for linking to another article over whose changeable content they have no control"276. Deschamps J in Crookes was of the view that publication requires "deliberate acts"277. This comes close to the case presented by the appellants here. Her Honour said278: "It should be plain that not every act that makes the defamatory information available to a third party in a comprehensible form might ultimately constitute publication. The plaintiff must show that the act is deliberate. This requires showing that the defendant played more than a passive instrumental role in making the information available." (emphasis in original) In contrast, in Visscher v Maritime Union of Australia [No 6]279, Beech-Jones J decided that the defendant Union was a publisher of defamatory 275 Crookes v Newton [2011] 3 SCR 269 at 287 [33] per Abella J (on behalf of Binnie, LeBel, Charron, Rothstein and Cromwell JJ). 276 Crookes v Newton [2011] 3 SCR 269 at 289 [36] per Abella J (on behalf of Binnie, LeBel, Charron, Rothstein and Cromwell JJ). 277 Crookes v Newton [2011] 3 SCR 269 at 297 [59] (emphasis in original). 278 Crookes v Newton [2011] 3 SCR 269 at 311 [91]. 279 (2014) 98 NSWLR 764. material when it included on its website a hyperlink to a defamatory article. That hyperlink comprised these words: "READ FULL STORY". In the circumstances, it was found that the hyperlink amounted to an adoption or promotion of the defamatory material280. The foregoing intrusions in the tort of defamation are inconsistent with the appellants' contended-for "intention" test; they exist precisely because there is otherwise no requirement that there be an intention to publish. Any such test is also inconsistent with the origins of the tort as one of strict liability. I agree with Kiefel CJ, Keane and Gleeson JJ that the appellants' contention should be rejected. Did the appellants publish the third-party comments? However, that is not the end of the matter. The respondent here, as already mentioned, emphasises that any degree of participation by a person in the act of conveying defamatory content, however minor, is sufficient to make that person a publisher. Nonetheless what constitutes participation in an act of publication, or in an act of making defamatory material "available for ... comprehension"281, is ultimately a question of fact. Care should be taken to recognise that language invoked in a judgment to express such fact finding is not an expression of any legal test. Each case must turn on its own facts. In that respect, participation in an act of publication is a specific example, for the purposes of the tort of defamation, of the generic test of "common design" or "common intention" applicable to all joint tortfeasors, as helpfully explained and described in the reasons of Edelman J in this case. What follows is an application of that test to the particular facts of this case. In the world of printing presses, it was easy to see who physically took part in the process of, for example, publication of a defamatory article in a newspaper. It included everyone involved in that process, from the author through to the newsvendor who sold the first paper to a third party. Thus, in Webb, Isaacs J was able to say the following282: "In Parkes v Prescott[,] Giffard QC quotes from the second edition of Starkie: 'All who are in any degree accessory to the publication of a libel, and by any means whatever conduce to the publication, are to be considered as principals in the act of publication: thus if one suggest illegal matter in 280 Visscher v Maritime Union of Australia [No 6] (2014) 98 NSWLR 764 at 773 [30] 281 Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575 at 600 [26] per Gleeson CJ, McHugh, Gummow and Hayne JJ. 282 Webb v Bloch (1928) 41 CLR 331 at 364. order that another may write or print it, and that a third may publish it, all are equally amenable for the act of publication when it has been so effected.' In R v Paine it is held: 'If one repeat and another write a libel, and a third approve what is wrote, they are all makers of it; for all persons who concur, and show their assent or approbation to do an unlawful act, are guilty: so that murdering a man's reputation by a scandalous libel may be compared to murdering his person; for if several are assisting and encouraging a man in the act, though the stroke was given by one, yet all are guilty of homicide.' A little later, in R v Drake, that law was reaffirmed. In The Queen v Cooper Lord Denman CJ said: 'If a man request another generally to write a libel, he must be answerable for any libel written in pursuance of his request: he contributes to a misdemeanour and is therefore responsible as a principal.'" (emphasis of Isaacs J; footnotes omitted) However, it may be more difficult to discern "participation" in a publication in the modern world of the Internet, which has replaced "one-to-many" communications with "many-to-many" communications283. A key element of modern Internet "platforms", such as Facebook, is the provision of "widespread, democratized, access to media and encouraging participation"284. The act of posting on a public Facebook page starts an electronic conversation, whether long or short, with potentially millions of other Facebook users. A public Facebook page is exposed to receiving potentially thousands of comments from around the world; a Facebook page owner has no actual means of controlling the contents of such comments285. Two propositions are relevant to the determination of these appeals. First, a person does not participate in the communication or conveyance of defamatory material merely because, "but for" something they did, there would have been no such communication or conveyance. Whilst all publishers should, as it happens, satisfy such a "but for" test, that test is not of itself a sufficient means of identifying who participated in an act of publication286. That explains why, for example, a 283 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 389-390 [58]-[59] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 284 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 390 [59] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 285 See [150] above. 286 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 394 [73] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). See also, eg, Crookes v Newton [2011] 3 SCR 269 at 311 [91] per Deschamps J; telephone company was not the publisher of defamatory material when it leased recording equipment that permitted a person to record defamatory accusations, which could then be heard by third parties by dialling certain telephone numbers287. It follows that not every facilitator of a communication or conveyance of defamatory material is necessarily a participant in its publication. Secondly, and consistently with the foregoing, it has emerged in more recent times that some acts that facilitate communication of defamatory material may be "so passive"288 that they cannot constitute publication of that material. Thus, in Bunt v Tilley289, internet service providers were not found to be the publishers of defamatory messages which had been posted on websites which used the services of those providers. Playing a merely "passive instrumental role"290 did not constitute participation in publication of the messages. In Google Inc v Duffy291, Kourakis CJ did not agree that an internet service provider was only a passive provider of a service, but otherwise accepted that such providers were not publishers because what they did was "too remote" from the act of publication. The Chief Justice said292: "The provision of an electronic protocol which allows a user access to the internet from his or her device plays no part in the selection of the particular information which is extracted from it. Moreover, an [internet service provider] has no practical capacity to control or limit the information obtained at the granular level needed to block particular statements or limit the information. The connection to the World Wide Web provided by [internet service providers] is too remote from the publication Tamiz v Google Inc [2013] 1 WLR 2151 at 2167 [40] per Richards LJ (Lord Dyson MR and Sullivan LJ agreeing); Google Inc v Duffy (2017) 129 SASR 304 at 344 [136] per Kourakis CJ (Peek and Hinton JJ agreeing on this point). 287 Anderson v New York Telephone Company (1974) 35 NY 2d 746. 288 Crookes v Newton [2011] 3 SCR 269 at 283 [21] per Abella J (on behalf of Binnie, LeBel, Charron, Rothstein and Cromwell JJ). 289 [2007] 1 WLR 1243; [2006] 3 All ER 336. 290 Bunt v Tilley [2007] 1 WLR 1243 at 1249 [23] per Eady J; [2006] 3 All ER 336 at 291 (2017) 129 SASR 304. 292 Google Inc v Duffy (2017) 129 SASR 304 at 344 [139] (Peek and Hinton JJ agreeing). of written material on the computer screens of users to be a publication even as a secondary participant." In Metropolitan International Schools Ltd v Designtechnica Corpn293 it was held that Google Inc was not a publisher when a search carried out by a user of its search engine resulted in the production of defamatory material. That was because the search was "performed automatically" without "human input"294. A different view was expressed by Beach J in Trkulja v Google Inc LLC [No 5]295. His Honour observed that internet search engines "operate precisely as intended by those who own them"296. It was on this basis that Kourakis CJ doubted that Google Inc offered only a passive service in making its search engine available to users of the Internet297. It has since been accepted by this Court that Beach J's observation is "strongly arguable"298. This conclusion follows from the proximate causative link between the application of Google's search engine and the resulting publication of defamatory content in the search results. In this way, it can be seen that Google Inc is an actual conveyor of such content. That publication of such material is a "direct consequence"299 of the application of the search engine. Accordingly, participation of this kind, in the means of communicating defamatory material, cannot be characterised as passive in nature. 293 [2011] 1 WLR 1743; [2010] 3 All ER 548. 294 Metropolitan International Schools Ltd v Designtechnica Corpn [2011] 1 WLR 1743 at 1757 [50] per Eady J; [2010] 3 All ER 548 at 561. 295 [2012] VSC 533. 296 Trkulja v Google Inc LLC [No 5] [2012] VSC 533 at [27]; cf Rana v Google Australia Pty Ltd [2013] FCA 60. 297 Google Inc v Duffy (2017) 129 SASR 304 at 352 [155] (Peek and Hinton JJ agreeing on this point). 298 Trkulja v Google LLC (2018) 263 CLR 149 at 163 [38] per Kiefel CJ, Bell, Keane, Nettle and Gordon JJ. See also Trkulja v Google Inc [2015] VSC 635 at [47] per McDonald J; cf Google LLC v Trkulja (2016) 342 ALR 504 at 590 [348] per Ashley, Ferguson and McLeish JJA. 299 Trkulja v Google Inc [2015] VSC 635 at [45] per McDonald J. In contrast to the position of an internet service provider300, or to that of the person who publishes hyperlinks on a website301, the providers, administrators and managers of a website, which hosted a popular Internet discussion forum, were found to be publishers of defamatory statements posted by third-party users of that forum302. The owners of that forum were found to have "played an active role in encouraging and facilitating the multitude of Internet postings by members of their forum"303. Those owners had designed the forum; they devised the rules for the forum and otherwise laid down the conditions for becoming a member and for making posts; they provided members with access to discussion threads developed on their forum; they employed administrators to monitor discussions and to delete posts that broke their rules; and they derived income from advertisements placed on their website304. However, the Hong Kong Court of Final Appeal ultimately decided that the owners were subordinate, and not main or first, publishers of the third-party posts305. Returning to Duffy, the issue before the Full Court of the Supreme Court of South Australia was whether Google Inc was a subsidiary publisher when its search engine was used and defamatory material was produced306. Kourakis CJ correctly observed that a key issue is the extent to which an electronic program facilitates the production of defamatory material307. Internet forum hosts, like the defendants in Oriental Press, have been held to be publishers of third-party material posted on their websites because of their greater involvement in procuring 300 See, eg, Bunt v Tilley [2007] 1 WLR 1243; [2006] 3 All ER 336. 301 See, eg, Crookes v Newton [2011] 3 SCR 269. 302 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366. 303 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 387 [51] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 304 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 387 [51] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 305 Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 399 [89], 406 [113] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 306 Google Inc v Duffy (2017) 129 SASR 304 at 352 [158], 359 [184] per Kourakis CJ, 401 [354] per Peek J, 467 [597] per Hinton J. 307 Google Inc v Duffy (2017) 129 SASR 304 at 344-345 [140] (Peek and Hinton JJ agreeing on this point). and controlling the making of such comments, thus evidencing the existence of a more direct connection between those hosts and those posts308. His Honour explained that connection as follows309: "Webpage masters of internet forums or web-based bulletin sites which receive communications electronically but then make them readable in an organised manner by visitors to their webpages are in a very different position. Hosts of those webpages more closely facilitate the publication of material, on their sites because: they invite communications on a particular subject matter (indeed, comment and discussion is the very purpose of such sites); they have a greater capacity to read both by virtue of the form it is in and the more limited quantity of material they receive in comparison to the data for which telecommunications cable provider [sic] or an [internet service provider] is a conduit; and they have a practical capacity to control the content of their website." A similar conclusion (expressed with some doubt) was reached by the Court of Appeal for England and Wales in Tamiz v Google Inc310 in relation to defamatory material posted on a blog hosted on a blogging platform provided by Google Inc. The provision of this platform was said to be analogous to a noticeboard controlled by Google Inc. Richards LJ observed311: "The provision of a platform for the blogs is equivalent to the provision of a notice board; and Google Inc goes further than this by providing tools to help a blogger design the layout of his part of the notice board and by providing a service that enables a blogger to display advertisements alongside the notices on his part of the notice board. Most importantly, it makes the notice board available to bloggers on terms of its own choice and 308 See, eg, Godfrey v Demon Internet Ltd [2001] QB 201; Metropolitan International Schools Ltd v Designtechnica Corpn [2011] 1 WLR 1743; [2010] 3 All ER 548. 309 Google Inc v Duffy (2017) 129 SASR 304 at 345 [141] (Peek and Hinton JJ agreeing). 310 [2013] 1 WLR 2151. 311 Tamiz v Google Inc [2013] 1 WLR 2151 at 2165 [33] (Lord Dyson MR and Sullivan LJ agreeing); cf Google Inc v Duffy (2017) 129 SASR 304. it can readily remove or block access to any notice that does not comply with those terms." But even then, and contrary to the reasons in Duffy, Richards LJ was not satisfied that Google Inc could be a secondary publisher of third-party defamatory material unless Google Inc had been notified of the presence of that material and then failed to remove that material within a reasonable period of time312. It is unnecessary to determine whether that conclusion is correct. The foregoing cases suggest that concepts of passivity, control and prior knowledge of defamatory content may be relevant to a factual determination as to whether a person has participated in the publication of a third party's defamatory post or comment on Facebook. It will be difficult to conclude, as a factual proposition, that such a person has so participated if they could not practicably control the making of such a defamatory post, had no prior knowledge of the content of that post, and did no more than participate in an electronic conversation using Facebook. In other words, the mere act of posting by a Facebook page administrator is unlikely to justify, in and of itself, the factual conclusion that the administrator has thereby participated in the publication of all subsequent responses. More is needed to be a publisher. Relevantly here, different considerations arise if it can be said that the Facebook page administrator procured, provoked or conduced the defamatory third-party response as distinct from any generally responsive posts. In those circumstances, and consistently with the observations of Isaacs J in Webb, there will be a more direct causative relationship between the administrator's post and the resulting third-party defamatory comment. In such cases, a factual conclusion of participation in the publication of the defamatory comment is more likely to be justified. Such a conclusion involves no modification of the law, but is merely an expression of its application to the specific facts of this case. No doubt there are many ways in which a Facebook page owner might be found, on the facts of a given case, to be a publisher of third-party posts or comments. For example, in a different statutory context, the Federal Court of Australia has decided that a Facebook page owner was the publisher of third-party posts when it acquired knowledge of the posts and decided not to remove them313. The Court applied the Byrne v Deane line of cases. 312 Tamiz v Google Inc [2013] 1 WLR 2151 at 2165-2166 [34]-[36] (Lord Dyson MR 313 Australian Competition and Consumer Commission v Allergy Pathway Pty Ltd [No 2] (2011) 192 FCR 34 at 42 [33] per Finkelstein J. The appellants here were not in the same position as the platform hosts in Oriental Press and Tamiz. That is because they were in the same position as all other public Facebook users. The appellants, to use the analogy from Tamiz, were users of Facebook's noticeboard and not their own noticeboard314. They owned no electronic program that caused or facilitated the publication of third-party comments; Facebook owned that program. They were also not in the same position as Google; they did not convey the third-party comments. Instead, the appellants used a system devised, designed and controlled (to an extent) by Facebook itself, and were subject to Facebook's conditions of use like all other users. An aspect of Facebook's control was described by the primary judge as follows315: "As is common knowledge, Facebook and other social media utilise algorithms that measure the relevance of articles and correlate the articles with the comment. In relation to Facebook pages (including public Facebook pages), the algorithm utilises, as one criterion, the incidence of persons gaining access to a particular comment or article. Mr Shelley detailed examples of how the outcome operates, albeit in circumstances where the algorithm itself is commercially sensitive and not available, even to experts. Essentially, Facebook measures the number of persons who show interest in the content (by, for example, liking an article, or sharing an article, or making comment on an article) and assesses a 'genus' of the persons who show interest. It then publishes the article to all persons within that genus. The same process occurs, for a public Facebook page of the kind with which the Court is here dealing in each of the three proceedings. Further, the content on Facebook may be searched and one could, if one were so minded, search for the plaintiff's name and the Facebook entries in relation to the plaintiff would be discovered." Save in the case of posts that procure, provoke or conduce the making of defamatory responses, the appellants only facilitated the publication of the third-party comments in two ways: first, by creating their own Facebook pages; and secondly, by making their own posts. Neither, whether considered separately 314 Tamiz v Google Inc [2013] 1 WLR 2151 at 2165 [33] per Richards LJ (Lord Dyson MR and Sullivan LJ agreeing); cf Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366 at 387-388 [53] per Ribeiro PJ (Ma CJ, Chan PJ and Litton and Gleeson NPJJ agreeing). 315 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [16]-[18]. Steward or cumulatively, made the appellants publishers of all third-party comments made on their respective Facebook pages. The creation of a Facebook page gives the page administrator the ability to make posts, filter out words, control – to an extent – third-party comments after they have been made (ie, by deleting or hiding posts or by banning other users), and irreversibly block, in advance, all comments. The subsequent ability to hide or control comments is not relevant to this case; as previously noted, the respondent does not contend that this is a case whereby the appellants have become publishers by reason of their failure to delete defamatory material within a reasonable time316. The ability to block all comments in advance or filter out certain words with the effect of blocking comments caught by the filter in advance is also irrelevant. That is because these have the effect of preventing, rather than causing, publication. This leaves the ability for the Facebook page administrator to make posts. Undoubtedly, these were made generally for the purpose of stimulating or inspiring the making of responsive comments by third parties. However, that of itself is not enough to permit the conclusion that the appellants participated, in some fashion, in the publication of those responses. This is not a case where it can be said that the appellants' conduct in every case of posting amounted to procuring, encouraging or conducing the posting of defamatory responses317. Nor is this a case where, at the very moment of third-party posting, it could be said that the appellants assented to, or in some way adopted, the contents of such posts. Rather, Facebook here has provided a means to have a public conversation, which takes place electronically, using its platform; it is a public meeting that takes place on the Internet. The convenor of a public meeting, however, is not the publisher of another person's speech, unless she or he in some way contributed to its making or in some way assented to it318. As the New Zealand Court of Appeal observed in a case concerning the publication of third-party comments on a person's Facebook page319: "[T]he most appropriate analogy in the present case is that of a public meeting. If Mr Murray had convened a public meeting on the subject of Mr Wishart's book, Mr Murray would have been liable for his own 316 cf Byrne v Deane [1937] 1 KB 818 at 830 per Greer LJ. See also Tamiz v Google Inc [2013] 1 WLR 2151 at 2165-2166 [33]-[36] per Richards LJ (Lord Dyson MR 317 cf Pritchard v Van Nes 2016 BCSC 686. 318 Murray v Wishart [2014] 3 NZLR 722 at 750 [132] per O'Regan P and Ellen France J (French J agreeing). 319 Murray v Wishart [2014] 3 NZLR 722 at 750-751 [132]-[134] per O'Regan P and Ellen France J (French J agreeing). statements at the meeting but not for those of others who spoke at the meeting, unless he adopted others' statements himself. ... [T]his is a useful analogy because it incorporates a factor in the present case ... the fact that Mr Murray solicited third party comments about Mr Wishart's book. Speakers at a public meeting could be identified (and sued) if they made defamatory statements just as many contributors to the Facebook page could be. That is another common factor. We acknowledge there are obvious differences between the present case and a public meeting. For example, statements at a meeting would be oral and therefore ephemeral unlike the written comments on the Facebook page. The public meeting analogy does illustrate a situation where even if a person incites defamation, he or she will not necessarily be liable for defamatory statements made by others. That is the case even if he or she ought to have known that defamatory comments could be made by those present at the meeting." It follows, and again save for those posts that procured, provoked or conduced defamatory responses, that the appellants' posts here were insufficiently connected to all the third-party comments made thereafter in response, to justify a conclusion that the appellants participated in their publication; the appellants' posts cannot be characterised as "instrumental"320 in the bringing about of such publication. That overstates the role played by each of the appellants. The appellants' posts are just the commencement of an electronic conversation. They are no more "instrumental" in making "available" future comments, than the first third-party comment is "instrumental" to the subsequent appearance of all third- party comments then made in response to it. In that respect, I respectfully disagree with the view of the learned primary judge. His Honour was of the view that "if an author of a comment, which is defamatory, were to post that comment on a public Facebook page, publication occurs by virtue of the fact that the owner of the public Facebook page allows access to the comment by the publication of the page and allows access by other third-party users to the comments on the page"321. In the case of a public, but not a private, Facebook page, I accept that when a post takes place, in most cases it is in the hope of prompting some response. But, for the reasons already given, merely allowing third-party access to one's Facebook page is, of itself, insufficient to justify a factual conclusion that the Facebook page owner participated in the 320 cf Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 725 [111] per Meagher JA and Simpson A-JA. 321 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [106] per Rothman J. publication of all the third-party comments posted thereafter. Were it not so, all Facebook page owners, whether public or private, would be publishers of third-party comments posted on their Facebook pages, even those which were unwanted, unsolicited and entirely unpredicted. Indeed, it might extend to cases where a Facebook page is hacked and then has posted on it entirely unwelcome, uninvited and vile defamatory comments, whether by the hacker or in response to a post made by the hacker. It might also render Facebook itself, at common law, the publisher of all posts made on Facebook322. It follows, and leaving aside cases in which a third-party comment is adopted by a Facebook page owner, that there must be something about the content, nature or circumstances of a Facebook post that justifies a conclusion that it has procured, provoked or conduced a defamatory third-party comment or comments, such as to make the owner the publisher of such comments. Nothing otherwise turns upon the fact that each appellant, according to Facebook's Statement of Rights and Responsibilities, owned the content and information they posted on Facebook323. Whatever ownership might mean in that context, it did not render the appellants publishers of third-party comments from the moment they were posted. Nor does the concept of "hosting" a Facebook page appear to have any significance. Each appellant engaged with Facebook in the same way as other Facebook users. The other matters relied upon by the respondent, as evidence of participation in the publication of the third-party comments, do not justify a contrary conclusion. The fact that the appellants' monitoring of third-party comments takes place after a comment has been made324, means it can have no causative relationship with the act of posting. At most, that monitoring might lead 322 Noting that this observation expresses no view on the applicability or otherwise of cl 91 of Sch 5 to the Broadcasting Services Act 1992 (Cth) to this case: cf Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 716-717 [62]-[69] per Meagher JA and Simpson A-JA. 323 Fairfax Media Publications Pty Ltd v Voller (2020) 380 ALR 700 at 719 [81] per Meagher JA and Simpson A-JA. 324 However, to monitor every third-party comment made in response was described as "physically impossible" and is necessarily made more difficult through the presence of "sub-threads of comments" and because third-party engagement can be delayed in the sense of it occurring "many days after the initial post by the Administrator": Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [39]-[40] per Rothman J. Steward to the deletion or hiding of a post, but only after it has been made325. Nor does the fact that the appellants were pursuing their commercial and financial interests make any difference to the outcome here. The pursuit of such interests supplies a motive and increases the likelihood that each appellant will make posts that will lead to greater third-party engagement. But the issue as to whether the appellants are publishers of the third-party Facebook user comments cannot turn upon the number of posts made and does not, without more, bear upon the relationship between any given post and any given comment. However, different considerations would arise in relation to Facebook posts that are likely to provoke or procure adverse third-party comments. Where such posts in fact procure defamatory comments, the Facebook page owner will have participated in their publication. Thus, in Pritchard v Van Nes, by reason of the inflammatory and defamatory nature of Ms Van Nes' posts on her own Facebook page, and the particular circumstances of the case, it was found that she "ought to have anticipated" that further defamatory third-party comments would then be made326. Ms Van Nes was thus the publisher of those comments. It will be a question of fact whether a given initial post has procured a third-party Facebook user to post a defamatory response. Here, the finding below was that only "certain" posts were potentially of this kind327. The circumstances in which those posts were made were that they were both "expected"328 and objectively "likely"329 to give rise to adverse comments. They thus exhibited a sufficient connection with those comments to justify a finding that the appellants had procured, provoked or conduced their making and that each was thus a publisher of them. (Whether those comments are defamatory is a matter that is yet to be decided.) In that respect, leaving aside the finding made below about expectation, it was sufficient that it was objectively likely that the posts would lead to the making of third-party adverse comments. But otherwise, and on the facts as 325 Although it was conceded that the monitoring of third-party comments can occur in advance (see [150] above), this was not done by any of the appellants. In that respect, it was also said this "would require a disproportionate amount of effort to the number of occasions that users have been blocked or comments deleted or hidden": Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [54] per Rothman J. 326 2016 BCSC 686 at [110]-[113] per Saunders J. 327 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [77], [90(xi)], [225] per 328 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [90(xi)] per Rothman J. 329 Voller v Nationwide News Pty Ltd [2019] NSWSC 766 at [90(xii)] per Rothman J. found in this case, the appellants were not the publishers of all other third-party comments made on their respective Facebook pages. The foregoing position of the appellants may be contrasted with that of the defendant Channel 7 in Thompson v Australian Capital Television Pty Ltd330. That case concerned the live transmission by Channel 7 in Canberra of a current affairs television program produced by Channel 9 in Sydney. The program was transmitted to Channel 7 by Channel 9. It included a live interview of a woman who made defamatory remarks about her father. Whilst Channel 7 had not produced the program, it was found that it had the ability to control and supervise the televised material331. Channel 7 had also decided that the broadcast be "near instantaneous" in circumstances where "a live to air current affairs program carries a high risk of defamatory statements being made"332. On those facts, this Court decided that Channel 7 was, together with Channel 9, a publisher of the defamatory remarks; the two broadcasters were joint tortfeasors because there had been "a concurrence in the act or acts causing damage"333. The position of the appellants here is distinguishable for the following reasons. First, Channel 7 was the actual conveyer of the defamatory material by its act of broadcasting; in contrast, for the reasons already given, as users of Facebook, the appellants are not the actual conveyers of third-party comments posted to their respective Facebook pages. Secondly, the appellants did not possess the equivalent of Channel 7's capacity to "control and supervise" the publication of the material. Thirdly, save in the case of the "certain" posts described above, it cannot be said that using Facebook in the ordinary course necessarily carries with it "a high risk" of defamatory third-party comments being posted. I would allow the appeals in part and would answer the question posed on the facts of this case as follows: The respondent will establish the publication element of the cause of action of defamation in relation to those third-party comments which had been 330 (1996) 186 CLR 574. 331 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 589 per Brennan CJ, Dawson and Toohey JJ. 332 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 590 per Brennan CJ, Dawson and Toohey JJ. 333 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 580-581 per Brennan CJ, Dawson and Toohey JJ, quoting The Koursk [1924] P 140 at 159- 160 per Sargant LJ. procured, provoked or conduced by posts made by the appellants on their respective Facebook pages.
HIGH COURT OF AUSTRALIA GEOFFREY JAMES BENNETT & ORS PLAINTIFFS AND COMMONWEALTH OF AUSTRALIA DEFENDANT Bennett v Commonwealth of Australia [2007] HCA 18 27 April 2007 ORDER Questions reserved for the consideration of the Full Court answered as follows: (1) Q Is s 3 of the Norfolk Island Amendment Act 2004 (Cth), in so far as it gives effect to: Items 1, 3 and 4 in Part 1 of Schedule 1 to that Act; and Item 5 in Part 1 of Schedule 1 to that Act to the extent that that item inserts into the Principal Act the following new provisions: paragraph 39A(1)(b); and paragraph 39A(2)(a); and (iii) section 39C; and the definition of "Returning Officer" in section 39D, valid? A Yes. (2) Q Who should pay the costs in respect of the special case? A The plaintiffs. Representation R J Ellicott QC with G R Kennett for the plaintiffs (instructed by Wright Stell) D M J Bennett QC Solicitor-General of the Commonwealth of Australia with K L Eastman for the defendant (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Bennett v Commonwealth of Australia Constitutional Law (Cth) – Powers of federal Parliament – Territories – Section 3 of the Norfolk Island Amendment Act 2004 (Cth) ("the Act") amended the Norfolk Island Act 1979 (Cth) so as to make Australian citizenship a necessary qualification for voting for, and standing for election to, the Legislative Assembly of Norfolk Island – Whether the provisions of the Act giving effect to the amendments were supported by s 122 of the Constitution. Constitutional Law (Cth) – Territories – Whether the challenge to the validity of the Act presented a political question not amenable to judicial determination – Whether "laws for the government" of a territory, to be valid, must provide for a form of government appropriate to the circumstances of the particular territory. Constitutional Law (Cth) – Territories – Territories "placed by the Queen under the authority of and accepted by the Commonwealth" – Territory granted institutions of representative government – Whether law enacted in reliance on s 122 may validly remove or curtail features of representative government so granted. Norfolk Island Amendment Act 2004 (Cth), s 3, Sched 1. Norfolk Island Act 1979 (Cth), ss 38-39D. GLEESON CJ, GUMMOW, HAYNE, HEYDON AND CRENNAN JJ. The parties to these proceedings brought a special case raising questions of law which were reserved for the consideration of a Full Court. At issue is the validity of certain provisions of the Norfolk Island Amendment Act 2004 (Cth) ("the 2004 Act"), by which Australian citizenship was made a necessary qualification for voting for, and standing for election to, the Legislative Assembly of Norfolk Island. Norfolk Island is a territory that was placed under the authority of and accepted by the Commonwealth, within s 122 of the Constitution. That occurred on 1 July 1914 in consequence of measures that will be described below. Section 122 provides that the Parliament may make laws for the government of such a territory. Norfolk Island electoral laws After its acceptance as a territory, Norfolk Island was governed pursuant to the Norfolk Island Act 1913 (Cth) (which came into effect on 1 July 1914), then pursuant to the Norfolk Island Act 1957 (Cth), then pursuant to the Norfolk Island Act 1963 (Cth), and, since 1979, pursuant to the Norfolk Island Act 1979 (Cth) ("the 1979 Act"). The 2004 Act amended the 1979 Act. The 1979 Act conferred on Norfolk Island a substantial degree of self- government. The plaintiffs do not suggest that prior legislation providing for the government of the island, but not self-government, was invalid. The 1979 Act, by s 31, established a Legislative Assembly, consisting of nine members who are elected for a maximum term of three years. The Legislative Assembly has power, subject to certain exceptions, to make laws for the peace, order and good government of the Territory. In 1979, the Australian Citizenship Act 1948 (Cth) ("the Citizenship Act") by s 10 provided that, subject to exceptions, a person born in Australia after a certain date was an Australian citizen by birth. By definition (s 5(1)), "Australia" included the territories that were not trust territories. In 1979, a person born on Norfolk Island would ordinarily be an Australian citizen. By virtue of an amendment to the Citizenship Act in 1986, a person born on Norfolk Island after 1986 would be an Australian citizen if one parent was an Australian citizen or a permanent resident. It will be necessary to return to certain aspects of the history and composition of the people of Norfolk Island said to be relevant to the plaintiffs' argument. For the present, it is sufficient to note that the special case records that, at the time of a census in 2001, the island had a permanent population of 1574 persons, of whom 82.5% were Australian citizens, 14.1% Crennan were New Zealand citizens, and 1.4% were citizens of the United Kingdom, with the remainder from other countries or not stated. Since 2002 Australia has not prohibited dual citizenship1. It was common ground that New Zealand citizens may have dual citizenship. To return to the matters of membership of, and voting for, the Legislative Assembly, s 38 of the 1979 Act set out the qualifications to be a candidate for election. Subject to disqualifications provided for by s 39, a person was qualified to be a candidate if the person was an Australian citizen or otherwise had the status of a British subject and satisfied certain other requirements as to age, entitlement to vote, and residency. Section 38 was amended in 19852, and the requirement to be an Australian citizen or otherwise have the status of a British subject was removed. Section 31 of the 1979 Act provided for the Legislative Assembly to enact laws relating to the election of members of the Legislative Assembly. An electoral roll was maintained pursuant to the Legislative Assembly Ordinance 1979 (NI). Section 6 set out the qualifications for enrolment. They included a requirement that a person be an Australian citizen or otherwise have the status of a British subject. In 1986, that requirement was removed3. The 2004 Act, which is the subject of these proceedings, amended the 1979 Act. The operative provision was s 3, which effected the amendments specified in a Schedule. The amendments altered s 38 of the 1979 Act, concerning qualifications for election to the Legislative Assembly and also introduced, for the first time in the Act, provisions dealing with qualifications to vote. The effect of the amendments was to make Australian citizenship a necessary qualification for voters and candidates. It is the validity of those amendments that is in question. Following the 2004 Act, the Legislative Assembly (Amendment No 1) Act 2004 (NI) amended the Norfolk Island legislation dealing with enrolment in such a way as to conform to the Commonwealth legislation's requirement of Australian citizenship as a qualification for enrolment. 1 Australian Citizenship Legislation Amendment Act (2002) (Cth) Sched 1 Item 1. 2 Statute Law (Miscellaneous Provisions) Act (No 1) 1985 (Cth) (Sched 1). 3 Statute Law Revision (Status) (No 3) Act 1986 (NI). See also Legislative Assembly Amendment Act 1991 (NI). Crennan The Commonwealth and the Norfolk Island legislation as to enrolment applied prospectively to persons applying for enrolment after a date in March 2004. The legislation did not take away the rights of persons who were enrolled before that date, and no person was disenfranchised. The generality of s 122 In Re Governor, Goulburn Correctional Centre; Ex parte Eastman4 it was pointed out that the territories, dealt with compendiously and briefly in s 122 of the Constitution, have differed greatly in size, population, and development. Some, such as Norfolk Island, the Coral Sea Islands, the Australian Antarctic Territory, the Ashmore and Cartier Islands, the Cocos (Keeling) Islands, Christmas Island, and the Heard and McDonald Islands, are external territories. Of those, some have no human inhabitants. In Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame5 this Court examined the history of the Territory of Papua (formerly British New Guinea) which was placed under the authority of the Commonwealth in 1905, and the Territory of New Guinea (a former German possession) which was placed under Australian administration in 1920. Those two territories later became a single territory, and in 1975 Papua New Guinea became an independent State. Other territories, such as the Australian Capital Territory, the Northern Territory, and Jervis Bay are internal, and the people and economies of those territories are, for most practical purposes, indistinguishable from those of the Australian States. The variety of circumstances to which s 122 must apply explains the generality of its language and, in particular, of the power to "make laws for the government of any territory". Norfolk Island before 1914 Norfolk Island was discovered, and claimed as a British possession, by Captain Cook on 10 October 1774. At that time it was uninhabited. It is situated to the east of the Australian mainland, within the area bounded by the parallels 28 degrees 59 minutes and 29 degrees 9 minutes south latitude and the meridians 167 degrees 54 minutes and 168 degrees east longitude. It is about 1075 kilometres from Auckland, 835 kilometres from New Caledonia and 1675 kilometres from Sydney. It is on approximately the same latitude as (1999) 200 CLR 322 at 331 [7]. (2005) 222 CLR 439. Crennan Brisbane. It has an area of about 3450 hectares. It was within the territory of New South Wales as defined by the Commission issued to Governor Phillip on 12 October 1786. In 1788, Norfolk Island was occupied as a penal settlement. Between 1788 and 1814, some public buildings and houses were erected, jetties were constructed, and some land was cleared. The settlement was abandoned in 1814, and the island remained unoccupied until 1825. In 1825, convicts were again sent to Norfolk Island. Additional land was cleared. Buildings were constructed, and roads were extended. Animals, including cattle, horses, sheep, pigs and goats were introduced. Some wool was exported to New South Wales. The penal settlement came to an end in 18556. By an Act of the Parliament of the United Kingdom of 18437 it was enacted that it should be lawful for Her Majesty, by Letters Patent under the Great Seal of the United Kingdom, to sever Norfolk Island from New South Wales, and to annex it to the Colony of Van Diemen's Land. Such severance and annexation were effected, from 29 September 1844, by letters patent dated 24 October 1843. Before the convicts, their guards, and accompanying settlers evacuated Norfolk Island in 1855, it had been decided by the United Kingdom Government that, upon their departure, the island would be occupied by the inhabitants of Pitcairn. Pitcairn is a small island about midway between New Zealand and Chile. It was settled in 1790 by a small group of mutineers from HMAV Bounty, who were fugitives from justice, and some Polynesian men and women. On 8 June 1856, the inhabitants of Pitcairn Island arrived on Norfolk Island, having travelled there by arrangement with the Imperial authorities. Some of them later returned to Pitcairn, and something of their subsequent history appears from the recent decision of the Privy Council in Christian v The Queen (The Pitcairn Islands)8. The 1976 Report of the Royal Commission into Matters Relating to 6 Commonwealth, Report of the Royal Commission into Matters Relating to Norfolk Island, October 1976 at 34-37, 101. 7 6 & 7 Vict c 35. [2006] UKPC 47. Crennan Norfolk Island9 stated that "when the 194 Pitcairn Islanders arrived at Norfolk on 8 June 1856, they came ... as new tenants of an Island with valuable and significant developments in the form of roads, bridges, buildings, wharves of sorts and cleared arable land." By the Australian Waste Lands Act 1855 (Imp)10 it was provided that it should be lawful for Her Majesty at any time, by Order in Council, to separate Norfolk Island from the Colony of Van Diemen's Land and to make such provision for the Government of Norfolk Island as might seem expedient. In 1965, in Newbery v The Queen11, Eggleston J, sitting as the Supreme Court of Norfolk Island, held that the 1855 Act authorised the creation of any form of government, representative or non-representative. By an Order in Council dated 24 June 1856 it was ordered: "[Norfolk Island] shall be and the same is hereby separated from the said Colony of Van Diemen's Land (now called Tasmania); and that from [the date of proclamation] all power, authority, and jurisdiction of the Governor, Legislature, Courts of Justice, and Magistrates of Tasmania over the said island shall cease and determine. ... [Norfolk Island] shall be a distinct and separate settlement; the affairs of which, until further Order is made in that behalf by Her Majesty, be administered by a Governor to be for that purpose appointed by Her Majesty, with the advice and consent of Her Privy Council." The 1856 Order in Council provided that the Governor for the time being of New South Wales should also be the Governor of Norfolk Island. Royal Instructions issued to the Governor of Norfolk Island, dated 24 June 1856, referred to the framing of laws for inhabitants who "are chiefly emigrants from Pitcairn's Island in the Pacific Ocean". On 14 October 1857, the Governor, Sir William Denison, declared and enacted the "Laws and Regulations for Norfolk Island" which are commonly 9 Report of the Royal Commission into Matters Relating to Norfolk Island, October 10 (18 & 19 Vict c 56). 11 (1965) 7 FLR 34 at 40-41. Crennan referred to as the "thirty-nine laws". They were based on the laws by which the families who had moved to Norfolk Island had governed themselves on Pitcairn. The population governed by those laws was fewer than 200. The laws provided for the election of a Chief Magistrate and Councillors. Every person who may have resided on the island for six months, who had attained the age of 20, and who was literate, could vote. The powers of the Chief Magistrate and Councillors were set out. There was provision for juries of Elders (males who had attained 25 years). Attendance of children at school was compulsory. Beer, wine, and spirituous liquor (except for medical purposes, to be administered by the Chaplain) were prohibited. In 1856, it was the intention of the Imperial authorities that Norfolk Island should be reserved exclusively for the families from Pitcairn and their descendants. However, this policy was later relaxed. In 1864, there were about 260 people on Norfolk Island, with eight family names. By 1900, an increased number of family names reflected some degree of immigration12. The departure from the original intention to exclude outsiders and the acquisition of land by settlers not of Pitcairn descent was noted by several official visitors to the island13. In 1866, the Governor, acting under instructions from the Secretary of State for Colonies, granted land for the establishment of a Melanesian Mission Station. By 1899, the mission had 210 Melanesian students. The 1976 Royal Commission Report described the Mission as "the wedge which split apart ... the original policy of reserving Norfolk for the Pitcairners."14 Towards the end of the 19th century, it was decided that Norfolk Island would be placed under the control of the Government of New South Wales. This, according to an Order in Council of 15 January 1897, was "in prospect of the future annexation of [the] island to the colony of New South Wales, or to any federal body of which that colony may hereafter form part". The new Australian 12 Varman, The Bounty and Tahitian Genealogies of the Pitcairn Island Descendants on Norfolk Island (1992) at viii. 13 Hoare, Norfolk Island: A Revised and Enlarged History 1774-1998, 5th ed (1999) 14 Report of the Royal Commission into Matters Relating to Norfolk Island, October 1976 at 38. The Melanesian Mission had ceased its operations on the island by 1920 and had shifted its headquarters elsewhere: Treadgold, Bounteous Bestowal: The Economic History of Norfolk Island (1988) at 117. Crennan Federation came into being on 1 January 1901, but it seems that at that time it had not been decided whether Norfolk Island would become a part of the State of New South Wales or whether it would become a territory under the authority of the Commonwealth. The Order in Council of 1897 recited that the 1856 Order in Council had been expressed to operate "until further order is made in that behalf by Her Majesty" and declared that Norfolk Island should be administered by the Governor of New South Wales who was empowered, by proclamation published in the New South Wales Government Gazette, to make laws for the peace, order and good government of the island subject to instructions from Her Majesty (ie from the Imperial Government). In Newbery v The Queen15, Eggleston J said that the practical effect of the 1897 Order was to enable the Governor of New South Wales to legislate in that capacity rather than in his former capacity as Governor of Norfolk Island. The administration of Norfolk Island involved the expenditure of public funds. The provision of services, and infrastructure, could be expensive. The practical reality is reflected in a memorandum to the Governor of New South Wales from the Colonial Treasurer, Mr Reid, dated 13 October 1896, expressing a willingness to advance a certain sum. Mr Reid wrote: "We propose, therefore, that the Island should not be annexed formally to New South Wales, and that our services should be administrative only, legislation being conducted as formerly, or in such manner as may seem fit to Her Majesty's Government. It should be understood, however, the Island is, as part of the arrangement, secured to New South Wales, or the future Federal body, when it is found expedient to ask for its annexation. This will be a tangible basis for an annual vote out of Colonial funds towards the expenses of the Island." New South Wales assumed responsibility for financial management of Norfolk Island until it became a territory under the authority of the Commonwealth in 1914. The New South Wales Government provided the first regular shipping service to the island in 1898. The Government contracted with Burns, Philp & Co, which called at the island 12 times a year. It paid directly the greater part of the salary of the Chief Magistrate and the full salaries of the senior 15 (1965) 7 FLR 34 at 37. Crennan policeman (who was seconded from the New South Wales force) and three school teachers (seconded from the New South Wales Education Department)16. In 1902, a cable station for the Pacific cable commenced operation on the island; the cable ran from Vancouver and at Norfolk Island separated into two branches, one to Auckland and the other to Southport in Queensland. The station operated for 60 years17. By an Order in Council dated 18 October 1900, the Queen revoked the 1897 Order and ordered that the affairs of Norfolk Island should thenceforth, and until further Order should be made in that behalf by Her Majesty, be administered by the Governor for the time being of New South Wales. The 1900 Order provided that all laws, ordinances and regulations in force in Norfolk Island should continue until repealed or altered. The 1900 Order took effect on 1 January 1901, the date when New South Wales ceased to be a colony and became a State of the new federal union. Letters Patent dated 29 October 1900 described the boundaries of the State so as to exclude Norfolk Island. Shortly after the establishment of the Commonwealth consideration was given to the annexation of Norfolk Island to the Commonwealth. Legislation was introduced into the Parliament in 1909, but did not proceed. Norfolk Island from 1914 By an Order in Council dated 30 March 1914, which recited that the Commonwealth Parliament had in 1913 enacted legislation to provide for the acceptance of Norfolk Island as a territory under the authority of the Commonwealth, the King revoked the 1900 Order and ordered that Norfolk Island was placed under the authority of the Commonwealth of Australia. The 1914 Order took effect from 1 July 1914. That also was the date of commencement of the Norfolk Island Act 1913 (Cth) by which Norfolk Island was declared to be accepted by the Commonwealth as a territory under the authority of the Commonwealth. Norfolk Island has been governed by the Commonwealth, initially under the provisions of the 1913 Act, and subsequently 16 Treadgold, Bounteous Bestowal: The Economic History of Norfolk Island (1988) 17 Treadgold, Bounteous Bestowal: The Economic History of Norfolk Island (1988) Crennan under the provisions of the Norfolk Island Act 1957, the Norfolk Island Act 1963, and the 1979 Act, the lastmentioned Act being the Act that was amended by the legislation under challenge in these proceedings. An airfield was built on the island in 1942-1943. The decision to construct the airfield was taken by the Allied South Pacific Command. Survey work was done by Australian and American engineers, and construction was by the New South Wales Department of Main Roads. The airfield was built on land acquired and owned by the Commonwealth18. The airport was upgraded by the Commonwealth during the 1980s. Another major infrastructure project funded by the Commonwealth at about the same time was the construction of a new cable station19. The author of an economic history of the island wrote in 198820: "[I]ncreased awareness of Norfolk Island at governmental level, and specifically in Canberra, must be attributed mainly to its strategic location in the hostilities with Japan, but it probably also reflected to some extent the islanders' record of war service and war-time changes in international and domestic (ie Australian) political attitudes to colonial territories in general. This increased awareness and an associated growth in concern with the welfare of the island community led to post-war Australian economic aid to the island eventually expanding to levels that dwarfed pre-war contributions. The aid included both technical and financial assistance. An increasing flow of experts and consultants visited the island to report and advise on matters that ranged from agriculture and forestry through conservation and the preservation of historic buildings to tourism and population policy." 18 Treadgold, Bounteous Bestowal: The Economic History of Norfolk Island (1988) at 163-164; Report of the Royal Commission into Matters Relating to Norfolk Island, October 1976 at 288. 19 Treadgold, Bounteous Bestowal: The Economic History of Norfolk Island (1988) 20 Treadgold, Bounteous Bestowal: The Economic History of Norfolk Island (1988) Crennan As the island became more accessible, especially by air, tourism developed. Norfolk Island had a special taxation status, and some of the activity that this brought to the island is exemplified in Esquire Nominees Ltd v Federal Commissioner of Taxation21. Over time, the mix of the population changed. The Report of the Royal Commission into Matters Relating to Norfolk Island stated that, at 30 June 1976, there were 859 persons on the Norfolk Island electoral roll22. Of these, 323 were descendants of people who transferred from Pitcairn in 1856. Of the other 536, nine were born on Norfolk Island, 199 were born in Australia, 196 in New Zealand, and 82 in England. The remainder came from other countries including India, Lithuania and Mauritius. According to the 2001 census, of the island's permanent population (1574), 48 per cent were of Pitcairn descent. Reference has been made earlier to the fact that, in 2001, 82.5 per cent of the permanent population were Australian citizens. The validity of the legislation The power conferred upon the Parliament of the Commonwealth by s 122 of the Constitution is a power to make laws for the government of any territory. We are not directly concerned with the further power to allow the representation of a territory in either House of the Parliament to the extent and on the terms which the Parliament thinks fit, although the plaintiffs argued that the nature of that additional power casts some light on the nature of the power presently in question. In Lamshed v Lake23, Kitto J said: "Section 122 ... confers on the legislative organ of the federation plenary power in respect of such areas as may be offered to and accepted by the federation so as to become territories to be governed by the federation ... Section 122 is a grant of power, not for the government of a community by a legislature established for it, but for the exercise of superior authority over a community by the legislature of another community ... Surely it means that a territory which has been accepted by the Australian Federation may be fitted into the Australian scene, so far as laws are 21 (1973) 129 CLR 177. 23 (1958) 99 CLR 132 at 153-154. Crennan concerned, by the legislative activity of the Australian Parliament: that the entire legal situation of the territory, both internally and in relation to all parts of the Commonwealth, may be determined by or by the authority of Parliament." It was accepted by the plaintiffs that there was, and is, no obligation upon the Parliament, in making a law for the government of Norfolk Island, to provide for self-government. In fact Norfolk Island did not have a substantial measure of self-government until 1979. A law which provided for the government of Norfolk Island by an administration based in Canberra might not now be regarded as a wise or effective law, but it would nonetheless be a law for the government of the Territory. The plaintiffs contended, however, that, in making provision for self-government of Norfolk Island, the Parliament was obliged to enact a law that provided for democratic representation and was not entitled to enact a law that "divide[d] the community by a criterion that has nothing to do with membership of that community." The concept of representation in the concluding words of s 122, though not presently of direct relevance, was said to reinforce this implied limitation upon the apparent generality of the opening words of s 122. It is important to observe the difference between a political and a legal argument about s 122. No doubt, if the Parliament decides that the most appropriate form of government of a territory is democratic self-government, then the method by which it provides for representation of the people of the territory in the process of self-government will affect the acceptability, and ultimately the success, of the form of government established. While concepts such as self-government, representative government, and democratic process have a minimum content, standards as to their most appropriate forms of expression vary with time and place24. To establish a form of self-government that purported to be representative but that provided a system of representation that was manifestly unfair or idiosyncratic might have adverse political consequences within Norfolk Island, or within the wider Australian community. It might be bad administration. It might make the island more difficult to govern. There may be political or administrative arguments against a particular system of self-government, but we are concerned with a question of constitutional power. 24 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 189-190 [10]. See also McGinty v Western Australia (1996) 186 CLR 140 at 246-247, 267- 268, where reference is made to the judgment of McLachlin CJ (then Chief Justice of British Columbia) in Dixon v Attorney-General (British Columbia) (1989) 59 DLR (4th) 247 at 262-263. Crennan The political justification advanced in the Parliament for making Australian citizenship a requirement for participation in the democratic process on Norfolk Island was that this would bring Norfolk Island into line with other Australian legislatures. "The bill", Parliament was told, "removes the right for non-Australian citizens to enrol and stand for election to an Australian legislature. There can be no justification for the continuation of such an anomaly. The Government does not believe that non-Australian citizens should be able to decide what laws will apply to Australian citizens in an Australian community. The Government does not believe that Norfolk Island should, in this respect, be different from all other Australian legislatures."25 That political justification for the legislation appears to have provoked a substantial part of the argument for the plaintiffs, the difficulty being to find a legal foundation for such argument. Much emphasis was placed upon the status of Norfolk Island, in and after 1856, as a "distinct and separate settlement". That concept was formulated at a particular time in the island's history but, as a review of that history shows, circumstances, and government policies, have changed over the years. There was a tendency, at times, to identify "the island community" with the descendants of those who came from Pitcairn in 1856 but, again, the facts are more complex. Those descendants are a minority of the island's permanent population. However distinct and separate the people, or some of the people, of the island may have wanted to be, for more than a century, in matters of administration, including financial arrangements for the provision of the infrastructure necessary for their sustenance, they have been linked, first to New South Wales, then to the Commonwealth. Part of the argument for the plaintiffs was directed towards demonstrating that Norfolk Island is not a part of Australia. In this respect, the Court was invited to disagree with what was said in Berwick Ltd v Gray26. There, Barwick CJ said that "Norfolk Island is part of the Commonwealth"27. Mason J, with whom McTiernan J and Murphy J agreed, said the same28. In Capital Duplicators Pty Ltd v Australian Capital Territory29 Gaudron J cited Berwick v 25 Australia, Senate, Parliamentary Debates (Hansard), 4 December 2003 at 19115. 26 (1976) 133 CLR 603. 27 (1976) 133 CLR 603 at 605. 28 (1976) 133 CLR 603 at 608. 29 (1992) 177 CLR 248 at 285-286. Crennan Gray with apparent approval, but went on to say, with reference to some external territories such as Papua and New Guinea, that "mere acquisition of territory does not, of itself, make that territory a constituent part of the Commonwealth either in a political or in a geographic sense". The answer to the question whether an external territory is "part of the Commonwealth" may depend upon the purpose for which the question is asked. There are different senses in which a place, or a community, or a body politic, may be said to be, or not to be, "a part of" another place, or community, or body politic. The political justification for the amending legislation appears to have provoked the dispute about whether the people of Norfolk Island are "an Australian community" or whether the Legislative Assembly of Norfolk Island is "an Australian legislature", but for the resolution of the legal challenge to the validity of the legislation what matters is that Norfolk Island is a territory under the authority of the Commonwealth. To take up what was said by Kitto J in the passage quoted earlier from Lamshed v Lake, the entire legal situation of the territory may be determined by the authority of the Parliament. If, in making that determination, the Parliament gives effect to a politically contestable view of what is appropriate, that of itself has no bearing on the validity of its legislation. Reference was made to the observation in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame30 that the acquisition of an external territory by Australia involves the establishment of relations between Australia and the inhabitants of that territory, and that the kinds of relationship that may be appropriate are as various as the kinds of territory that may be acquired. It is difficult to see how that assists the plaintiffs. The observation was made in the context of the relationship that existed between Australia and the people of Papua and New Guinea. The variety of the kinds of relationship that may exist between Australia and the people of external territories is, no doubt, one of the reasons for the width of the power conferred by s 122. The plaintiffs submitted that a law which adopts Australian citizenship as a criterion for the conferring of electoral rights in relation to the people of Norfolk Island is not a law for the government of the people of Norfolk Island because it selects as a criterion one which is not a defining characteristic a person must possess in order to be a member of the Norfolk Island community or one of the people of Norfolk Island; it excludes from electoral rights a substantial number of people who are part of the people of Norfolk Island. Once it is 30 (2005) 222 CLR 439 at 457 [29]. Crennan accepted (as the plaintiffs accepted) that Parliament may make laws for the government of a territory that deny electoral rights to all of the people of the territory, it is difficult to understand why Parliament may not make laws that deny electoral rights to some of the people of the territory or, in particular, to a relatively small minority of the people who are not Australian citizens. Some forms of discrimination in the conferral or withholding of electoral rights may be unjust or unwise, or inconsistent with currently held democratic values. That does not necessarily mean they are unlawful. Other forms of discrimination are generally accepted. Fixing a minimum age for voting is one example. It is impossible to find in the text of s 122, or elsewhere in the Constitution, a prohibition against discriminating on the basis of Australian citizenship. There is nothing in the Constitution, or in the history or circumstances of Norfolk Island, which denies to the laws in question the quality of being laws for the government of Norfolk Island. It was further submitted that "[t]he doctrine of representative government is embedded in the Constitution". The plaintiffs said: "The question arises whether, if Parliament decides to establish a form of locally based government for a territory, such as that provided by the 1979 Act (as distinct from direct administration by officers of the Commonwealth), it must do so in a way that ensures the creation and continuing existence of a legislature that is chosen by the people of the territory in accordance with principles of representative government". The question as posed by the plaintiffs according to its terms arises only if Parliament decides to establish a form of locally based government for a territory. Implicit is the acknowledgment, made explicitly in oral argument, that a law for the government of a territory may provide for a government that is not locally based. If the principles of representative government referred to in the question are those generally accepted as applicable to "the people of [particular States]" or "the people of the Commonwealth" then, it should be noted, as was pointed out in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame31, that those references in the Constitution do not bind Australia to any particular form of relationship with all inhabitants of all external territories acquired by the Commonwealth, whatever the form and circumstances of such acquisition. Just as the plaintiffs acknowledge that locally based government might be inappropriate to an external territory, so also, depending on the circumstances, a locally based government constructed according to current 31 (2005) 222 CLR 439 at 457 [30]. Crennan Australian standards of representative democracy may be inappropriate. Indeed, the very complaint of the plaintiffs in this case is that an Australian standard of qualification to participate in the democratic process has been imposed inappropriately on an island population whose distinctive character has not been given adequate recognition. In Kruger v The Commonwealth32, Dawson J said: "No system of government, elected or otherwise, is prescribed for the territories. Sovereign legislative power is conferred by s 122 upon the Commonwealth Parliament to make laws for the government of the territories but there need be no representation of a Territory in either House of the Parliament, nor is there any requirement that institutions of representative government exist within the territories." Bearing in mind the diversity of territories, the Parliament, if it decides to establish institutions of representative government within a territory, is not bound to conform to any particular model of representative government. There is nothing in the Constitution, and there is nothing inherent in the concept of representative government, that requires the Parliament, if it chooses to legislate for self-government, to enfranchise residents of Norfolk Island who are not Australian citizens. In Spratt v Hermes33, Barwick CJ said: "Section 122 gives to the Parliament legislative power of a different order to those given by s 51. That power is not only plenary but is unlimited by reference to subject matter. It is a complete power to make laws for the peace, order and good government of the territory – an expression condensed in s 122 to 'for the government of the Territory'. This is as large and universal a power of legislation as can be granted ... But this does not mean that the power is not controlled in any respect by other parts of the Constitution or that none of the provisions to 32 (1997) 190 CLR 1 at 69-70. 33 (1965) 114 CLR 226 at 241-242; cf the reference to Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 by Laws LJ in R (Bancoult) v Secretary of State for Foreign and Commonwealth Affairs [2001] QB 1067 at 1104. Crennan be found in chapters other than Chap VI are applicable to the making of laws for the Territory or to its government. It must remain, in my opinion, a question of construction as the matter arises whether any particular provision has such an operation, the construction being resolved upon a consideration of the text and of the purpose of the Constitution as a whole." Whether, upon such a question of construction, some provision made by the Parliament concerning the government of a territory might offend a requirement of the Constitution is a question that does not need to be decided in this case. The plaintiffs have been able to point to nothing in the Constitution that obliged the Parliament, when it decided to allow residents of Norfolk Island to vote for a Legislative Assembly, to confer a right to vote on all adult residents of Norfolk Island, including those who are not Australian citizens. Conclusion The questions reserved for the consideration of the Full Court should be answered as follows: Is s 3 of the Norfolk Island Amendment Act 2004 (Cth), in so far as it gives effect to: Items 1, 3 and 4 in Part 1 of Schedule 1 to that Act; and Item 5 in Part 1 of Schedule 1 to that Act to the extent that that item inserts into the Principal Act the following new provisions: paragraph 39A(1)(b); and paragraph 39A(2)(a); and (iii) section 39C; and the definition of "Returning Officer" in section valid? Yes. Crennan (2) Q Who should pay the costs in respect of the special case? The plaintiffs. Kirby KIRBY J. A special case34 asks whether provisions of the Norfolk Island Amendment Act 2004 (Cth) ("the 2004 Act") are valid in accordance with s 122 By s 122, the Parliament is empowered to "make laws for the government of any territory". The challenged laws, described elsewhere36, concern the qualifications of candidates for election as members of the Legislative Assembly of Norfolk Island37 ("NI"). They also provide for qualification to be an elector by enrolment on the electoral roll38. The purpose of the 2004 Act is, with prospective effect, to limit the eligibility to vote in, and stand for, elections for the NI Legislative Assembly, to persons who are Australian citizens39. On the face of things, a law made by the Parliament on the qualification of candidates and voters for elections for the Legislative Assembly of a territory of the Commonwealth is a law made "for the government of" that territory. Because NI is incontestably a "territory" within s 122, the 2004 Act thus appears to be valid in accordance with the Constitution. It is from the Constitution that this Court derives its powers40. It is bound to uphold the Constitution41. However, as these proceedings have demonstrated, the 2004 Act, imposing for the first time a universal requirement of Australian citizenship for participation in the representative political life of NI, has proved controversial amongst some of the population of that territory. The attempt to impose Australian citizenship in the ways stated was described by the plaintiffs' counsel as an endeavour to divide the "community" of NI in a way said to be impermissible under the Constitution and therefore invalid. In the face of the 34 The special case was stated by consent of the parties on 4 September 2006. 35 No other source of constitutional power was propounded. Thus no reliance was placed on s 51(xix), (xxix) or (xxx). 36 Reasons of Callinan J at [167]-[170]. 37 The 2004 Act, Sched 1 inserting ss 39A, 39B in Norfolk Island Act 1979 (Cth). Read with s 38(2)(da) Norfolk Island Act 1979 (Cth). 38 The 2004 Act, ss 39A, 39B. 39 Australia, Senate, Norfolk Island Amendment Bill 2003, Explanatory Memorandum at 2, set out in the reasons of Callinan J at [171]. 40 Constitution, s 71. 41 See eg Constitution, ss 75(iii), 76(i). Kirby broad grant of legislative power contained in s 122, reinforced by nearly a century of this Court's decisions, in which the power has been variously described as "ample"42, "independent"43 and "relevantly plenary"44 and such as to "stand[] apart"45, the plaintiffs obviously faced many obstacles in making good their contentions. The concerns voiced in the proceedings are strongly held. In my view, the plaintiffs fail. However, out of respect for the arguments presented and the issues of principle that have been canvassed, I will state separately my reasons for being unable to accede to them. The facts, history and legislation The facts: The special case arises out of a statement of claim invoking the original jurisdiction of this Court. The status of the several plaintiffs should be noted because it gives an indication of the concerns that lie behind the proceedings. The Commonwealth did not contest the factual statements made in the statement of claim concerning the plaintiffs. Nor did the Commonwealth at any stage submit that the plaintiffs lacked standing to bring the proceedings or to tender the constitutional issue for decision46. According to the statement of claim, the first plaintiff, Mr Geoffrey Bennett, was born in New Zealand in 1943 and is a citizen of that country. He holds no other citizenship. He has resided continuously on NI since May 1968; was enrolled as an elector in 1972; served on the NI Council from 1976-79; was elected a member of the NI Legislative Assembly in May 1986, was re-elected on two occasions and held office as Minister for Finance until 4 July 1995. The second plaintiff, Mr John Christian, was born in New Zealand in 1959. He too is a citizen of that country holding no other citizenship. He is a descendant of the settlers who moved to NI from Pitcairn Island in 1856. He has 42 Buchanan v The Commonwealth (1913) 16 CLR 315 at 327 per Barton ACJ. 43 (1913) 16 CLR 315 at 335 per Isaacs J. 44 New South Wales v The Commonwealth (2006) 81 ALJR 34 at 137 [460]; 231 ALR 45 (2006) 81 ALJR 34 at 137 [460]; 231 ALR 1 at 122. 46 cf Croome v Tasmania (1997) 191 CLR 119 at 126, 132-133, 138; Abebe v The Commonwealth (1999) 197 CLR 510 at 528 [32]; Combet v Commonwealth (2005) 80 ALJR 247 at 312-313 [303]-[307]; 221 ALR 621 at 703-705. Kirby resided in NI from 1979 to 1981, and continuously since 1999. He has been enrolled on the NI electoral roll continuously since 2002. The third plaintiff, Mr Bruce Walker, was born in New Zealand in 1946. He is a citizen of that country and holds no other citizenship. In 1996, he became a "resident" under the Immigration Act 1980 (NI) and has been continuously enrolled as an elector since 1993. He served as a member of the Legislative Assembly from 2000 to 2001. The fourth plaintiff, Mrs Ann Walker, was born in Scotland in 1947. She migrated to New Zealand in 1970 and was granted New Zealand citizenship in 1979. She is a citizen both of New Zealand and of the United Kingdom and holds no other citizenship. She married the third plaintiff in 1985 and has lived continuously on NI since 1990. She has been enrolled on the NI electoral roll since 1993. The fifth plaintiff, Mr Richard Kleiner, was born in the United States of America in 1951. He is a United States citizen and holds no other citizenship. However, he is of Pitcairn descent, being the great-grandson of John Young, who was born on Pitcairn Island in 1852 and removed to NI in 1856. Mr Kleiner has resided continuously on NI since December 1997. He held a "temporary entry permit", and subsequently a "general entry permit" under the Immigration Act 1980 (NI), before becoming a "Resident" under that Act on 23 March 2006. He has been enrolled continuously on the NI electoral roll since 2001. The sixth plaintiff is the Administration of Norfolk Island, a body politic constituted by s 5 of the Norfolk Island Act 1979 (Cth) ("the 1979 Act"). By that provision, the Administration is capable of suing. The Administration brings this constitutional challenge against the Commonwealth, it was said, because of the political opposition in NI to the challenged provisions of the 2004 Act. The natural person plaintiffs assert that, but for the 2004 Act, they would be entitled to be candidates for election to the NI Legislative Assembly. Further, they assert that, if the Act is valid, they will not be so entitled. Instead, they will, if removed from the NI electoral roll, lose their entitlement to re-enrolment and to vote in elections for the NI Legislative Assembly. They object to the deprivation of these civil rights on the basis that it disturbs long-standing features of the entitlement of residents, like themselves, to participate in the political life and democratic, representative self-government of NI. History of acquisition of NI: The special case annexes 29 items of historical material, comprising legal and historical records relating to NI, dating back to 1786. The first recorded description of NI was that of Commander James Cook during his exploratory voyage to the South Seas for the British Admiralty in 1774. At the time of the first encounter with European civilisation, NI was unoccupied. Its remoteness, possible strategic value and the utility of its tall Kirby pines for ships' masts were noted in Cook's A Voyage towards the South Pole, which was published in England in 177747. NI was included within the commission granted by George III to Captain Arthur Phillip upon his despatch to establish the British "territory called New South Wales"48. The decisions to establish NI as a penal settlement; to abandon that settlement in 1814; and later, in 1825, to re-establish it and to bring it within the Government of the Colony of Van Diemen's Land (now Tasmania), are described in other reasons49. So too is the decision taken by the Imperial Government to resettle the inhabitants of Pitcairn Island on NI in 1856. From that time, the Pitcairners comprised the majority of the population on NI. This fact, together with the geographical isolation of NI, its tiny population, the changes in its governmental arrangements, and its distinctiveness, led the Imperial Government to provide, by the Waste Lands (Australia) Act 1855 (Imp)50, for the separation of NI from Van Diemen's Land. Such separation was effected by an Order in Council of 24 June 1856. This provided that, after a designated date, NI: "shall be a distinct and separate settlement; the affairs of which, until further Order is made in that behalf by Her Majesty, be administered by a Governor to be for that purpose appointed … and … the Governor and Commander-in-Chief … in … the Colony of New South Wales shall be constituted and appointed … Governor of the said island called Norfolk Island." Amongst the other provisions of the Order in Council of 1856 was one permitting the Governor: "[T]o make grants of Waste Lands to Her Majesty belonging within the said island to private persons for their own behalf, or to any persons, bodies politic or corporate, in trust for the public use of Her subjects there resident, or any of them." These measures coincided with moves to enhance representative government in the other Australian colonies, for which power was specifically 47 Hoare, Norfolk Island: An Outline of Its History 1774-1977, 2nd ed (1978) at 1-3. 48 Governor Phillip's First Commission (12 October 1786), reproduced in Historical Records of Australia, Series 1, Governors' Despatches to and from England, vol 1 49 Reasons of Gleeson CJ, Gummow, Hayne and Crennan JJ ("joint reasons") at [12]-[17]; reasons of Callinan J at [154]-[158]. 50 18 & 19 Vict c 56. Kirby given, or recognised, in the Waste Lands (Australia) Act. This was the context in which Royal Instructions were given to Sir William Denison (who was also Governor of New South Wales) to "have full power and authority to make laws for the order, peace, and good government of the said island", that is, NI. The Royal Instructions recited51: "… And whereas the inhabitants of the said island are chiefly emigrants from Pitcairn's Island in the Pacific Ocean, who have been established in Norfolk Island under our authority, and who have been accustomed in the territory from which they have removed to govern themselves by laws and usages adapted to their own state of society, you are, as far as practicable, … to preserve such laws and usages, and to adapt the authority vested in you … to their preservation and maintenance." The thirty-nine laws: Pursuant to the foregoing Instructions, Governor Denison made "laws and regulations for Norfolk Island" on 14 October 185752. These comprised the "thirty-nine laws". They included provision, as appropriate to the circumstances of the settlement, for a measure of representative democracy. This paralleled similar laws being made in other parts of the British Dominions, at least in colonies comprising European settlers mostly derived from the United Kingdom itself. Following the loss of the American colonies and settlements in the War of Independence of 1776, leading to the creation of the United States of America, the Imperial Government was generally sensitive, and amenable, to the aspirations for forms of representative government in the United Kingdom's settler colonies beyond the seas53. Governor Denison's "thirty-nine laws" for NI were simply one instance of these developments. The thirty-nine laws included such provisions as: The Executive Government of Norfolk Island, during the absence of the Governor, shall be vested in a Chief Magistrate and two Assistants or Councillors, to be elected annually by the community as hereinafter directed. The Chief Magistrate must be resident on the Island; he must be in possession of a landed Estate therein; and he must have attained the age of twenty-eight years. 51 Royal Instructions to His Excellency Sir William T Denison, Governor General, made 24 June 1856; entered 16 September 1857. 52 Supplement to New South Wales Government Gazette, 30 October 1857. 53 Maitland, The Constitutional History of England (1908) at 338-340 ("Maitland"). Kirby The Councillors must be resident on the Island, and must have attained the age of twenty-five years. The election of the Chief Magistrate and Councillors shall take place on the day after Christmas Day in each year … Every person who may have resided upon the Island for six months, who has attained the age of twenty years, and who can read and write, shall be entitled to vote at the election of the Chief Magistrate and Councillors. Should it appear to the Chief Magistrate that any change in, or addition to the Laws or Regulations of the Island are required, he will first consult with his Councillors, and should it appear to the three, or to a majority of the three, that such a change or addition is advisable, notice will be given to the community of the intention of the Chief Magistrate to submit such change or such new rule for their consideration at a public meeting to be held within fourteen days of the date of the Notice. 15. At such public meeting, the nature of the proposed change or addition, and the reasons for it, will be explained to the meeting by the Magistrate and Councillors, and the people present will be invited to express their opinion upon it. After the explanation and discussion, the persons present will be called upon to vote for or against the proposition, and a list of the number in favour of or against the measure will be recorded on the minutes of the proceedings. 16. No repeal of any Law or Regulation will be valid, until confirmed by the Governor; but a new Law or Regulation may be acted on, when it has been approved of by a public meeting, without such confirmation, should it refer to a subject of immediate importance." In some respects the thirty-nine laws were in advance of the times. They included provisions for conciliation of disputes54; a form of trial before a jury consisting of seven elders55; compulsory education of children to the age of 54 Clause 17. 55 Clauses 19-30. Kirby fourteen years56; the employment of a properly qualified schoolmaster57; and a prohibition on beer, wine or spirituous liquor save for medicinal purposes58. Commenting on the introduction of these laws in NI, Governor Denison pronounced himself59: "… convinced … that my duty was to allow them to be happy in their own way. We Englishmen are too apt to insist upon the adoption of our rules and habits in everything; we make up our mind upon matters of opinion, upon matters of practice, and having satisfied ourselves (very often, I must say, after a very cursory examination) that any given system is best for us, we jump at once to the conclusion that it is best for every one else, and we insist upon the adoption of it by others, without any thought that they may also have opinions of their own, with which they may be unwilling to part." The Governor "left untouched" the law that gave the women, as well as the men, a vote in the annual election of the Chief Magistrate60. This universal franchise on NI was well in advance of the introduction of female suffrage elsewhere. It was not attained throughout Australia until after Federation61 and in the United Kingdom and elsewhere, much later. The thirty-nine laws continued in operation, with various amendments and additions until Governor Henry Brand, on 7 April 1897, pursuant to an Order in Council, revoked the earlier laws and, by Proclamation, made new laws for NI62. These laws continued the office of the Chief Magistrate in whom was vested the 56 Clause 32. 57 Clause 34. 58 Clauses 35-36. Alcoholic Prohibition in the United States of America was first introduced in the State of Maine in 1851. That law eventually led to the adoption of the XVIIIth Amendment to the United States Constitution in 1919, which remained in force until its repeal by the XXIst Amendment in 1933. 59 Denison, Varieties of Vice-Regal Life, (1870), vol 1 at 410 ("Denison") (emphasis in original). 60 Denison, vol 1 at 411. 61 As contemplated by the Constitution, s 30. 62 Proclaimed and published in Supplement to the New South Wales Government Gazette, 7 April 1897 at 2564. Kirby executive government of NI. However, he was thereafter appointed by the Governor from time to time63. Provision was made for a council of elders64 with large powers, subject to the approval of the Chief Magistrate, to "make, amend, and repeal by-laws … [and] make suggestions to the chief magistrate as to any changes in the laws and regulations of the island which they may think desirable"65. The council of elders was to be elected on the first Tuesday in January of each year66. The members were to be "elders of the age of thirty years or upwards" but subject to disqualification. The Chief Magistrate was obliged to keep "a register of the names of the male natural born or naturalized subjects of Her Majesty of the age of twenty-five years and upwards, who have for the previous six months resided on the island". Those persons are referred to as "the elders"67. By the time of the 1897 Order in Council, the earlier provision for universal suffrage was replaced by a provision confining participation to the male population as defined68. Female suffrage and candidature were not restored until NI became a territory of Nationality status of British subject: The developments that preceded, and followed, the establishment of the Commonwealth of Australia are described in other reasons70. They included the enactment of federal legislation for the acceptance of NI as a territory under the authority of the Commonwealth, and the Order in Council of 1914 by which George V placed NI under the authority of 63 Clause 1. 64 Clause 8. 65 Clause 9(I) and 9(II). 66 Clause 11(I). 67 Clause 12. 68 Laws, Rules and Regulations for the Government of Norfolk Island 1897, published in the Supplement to the New South Wales Government Gazette, 7 April 1897 at 2567. See ss 11(I) and 12. 69 By Executive Council Ordinance 1915, ss 4 and 5, inserting new ss 2C and 6 in the Executive Council Law 1913. Commonwealth Gazette, 19 July 1915. 70 Joint reasons at [11]-[28]; reasons of Callinan J at [160]-[164]. Kirby the Commonwealth71. elsewhere72. The successive NI electoral laws are described As was normal during the 19th (and for most of the 20th) century, the nationality requirement for participation in the elected body of NI contemplated, after the Order in Council of 1897, conformity to the only notion of nationality then applicable in Australia and throughout the British Empire: that of being a natural born or naturalised British subject. This is also the only express requirement of nationality mentioned in the Constitution73. There were age and residence requirements and, for a short interval, a restored requirement of the male gender74. However, the common feature of the requirements for participation under electoral laws after 1897 was the nationality status of allegiance to the British Crown. When NI became a territory of the Commonwealth, this feature caused no discordance with Australian electoral laws. This was because the same principle was applied throughout Australia75. Australian citizenship, as such, was not provided for by legislation until the Nationality and Citizenship Act 1948 (Cth)76. In 1981, for the first time, the Commonwealth Electoral Act 1918 (Cth) ("Commonwealth Electoral Act") was amended to confer the entitlement to enrol and vote on "Australian citizens" as such77. However, the entitlement (and obligation78) to vote in Australian elections continued to apply to British subjects whose names were on the roll immediately before 26 January 198479. Indeed, such persons remain on the Australian electoral roll, unless otherwise lawfully removed. However, since 1984, persons who are not Australian citizens and 71 Within the Constitution, s 122. 72 Joint reasons at [3]-[4], [6]-[9]. 73 See eg the Constitution, ss 42, 44(i). See also s 117. 74 Laws, Rules and Regulations for the Government of Norfolk Island 1897, published in the Supplement to the New South Wales Government Gazette, 7 April 1897 at 2567. See ss 11(I) and 12. 75 Commonwealth Electoral Act 1918 (Cth), s 93(1)(b)(ii). 76 See Re Patterson; Ex parte Taylor (2001) 207 CLR 391. 77 Statute Law (Miscellaneous Amendments) Act 1981 (Cth), s 32. 78 Commonwealth Electoral Act, s 245(1). 79 Commonwealth Electoral Act, s 93(1)(b)(ii). Kirby whose names were not on the electoral roll immediately before 26 January 1984, may not have their names added to the Commonwealth electoral roll. This is now the case even if those persons are British subjects lawfully resident in Australia. Successive representative bodies: The representative organ of government of NI underwent several changes during the 20th century. The council of elders was abolished in July 1903. It was replaced by an Executive Council, elected by the "Elders"80. That Council was enlarged in 1913, although only two of the seven members were then elected by the "Elders"81. The Executive Council so established was continued by the Norfolk Island Act 1913 (Cth), subject to alteration or abolition by Ordinance made under that Act. By the Executive Council Ordinance 1915, the former Executive Council was abolished and replaced by an Executive Council of 12, six of whom were elected and six appointed by the Administrator82. The Administrator, in turn, was appointed by the Governor-General83. Eligibility for election was open to any person entitled to vote at elections of members of the Executive Council84. Eligibility to vote at elections extended to any person, male or female, who was a natural born or naturalised subject of the King, 21 years of age or over, who met specified residency requirements and was not subject to disqualifying criminal The foregoing provisions were repealed in 192586. A new Council was established along generally similar lines. A like change occurred in 1935 providing for the Advisory Council of NI. This comprised eight members, 80 Law to make better Provision for a Council at Norfolk Island to be called "The Executive Council", 1903, ss 1, 2, 3. Supplement to the New South Wales Government Gazette, 3 July 1903. 81 Norfolk Island Act 1913 (Cth) s 4; Executive Council Law 1913, ss 2, 6. New South Wales Government Gazette, 24 December 1913. 82 Executive Council Ordinance 1915, s 5. 83 Administration Law 1913, s 3(1). New South Wales Government Gazette, 24 December 1913. 84 Executive Council Law 1913, s 6; cf Executive Council Ordinance 1915, s 5. 85 Executive Council Ordinance 1915, s 4 inserting ss 2C and 3 in Executive Council Law 1913. 86 Executive Council Ordinance 1925, s 3. Commonwealth Gazette, 23 April 1925. Kirby elected annually87. That provision was, in turn, replaced in 1960 by the establishment of the Norfolk Island Council comprising eight elected councillors88. In 1968, the franchise for voting for the NI Council was expanded to include persons holding temporary immigration permits who had been resident on NI for the preceding 12 months89. By the same provision, eligibility for election to the Council was limited to those who had lived on NI for the five years preceding nomination for election90. New residency requirements for voting for the Council were introduced in 197091 to amend further the residency requirements by excluding temporary entry permit holders from the franchise. That was the position when a Royal Commission into matters relating to NI was established by the Commonwealth. The report of the Royal Commissioner (The Hon Sir John Nimmo) was published in October 197692. The report recommended that, except in special cases, all laws that applied to other parts of Australia generally should also apply to NI93. Self-government of NI: In a policy statement made in May 1978 the Australian Government set out its response to the Royal Commissioner's report94. After consultations with the NI community, the Minister made it clear that the recommendation of assimilation of laws had been rejected: 87 Norfolk Island Act 1935 (Cth); Advisory Council Ordinance 1935, ss 5, 6. Commonwealth Gazette, 27 June 1935. 88 Norfolk Island Act 1957 (Cth), s 11; Norfolk Island Council Ordinance 1960, s 6. 89 Norfolk Island Council Ordinance 1968, s 3 amending s 12 of Norfolk Island Council Ordinance 1960. 90 Norfolk Island Council Ordinance 1968, s 2 amending s 8 of Norfolk Island Council Ordinance 1960. 91 Norfolk Island Council Ordinance 1970, s 4 amending s 12 of Norfolk Island Council Ordinance 1960. 92 Australia, Royal Commission Into Matters Relating to Norfolk Island, Report, October 1976. 93 Australia, House of Representatives, Parliamentary Debates (Hansard), 11 May 94 Policy on Norfolk Island in Australia. See Australia, House of Representatives, Parliamentary Debates (Hansard), 11 May 1978 at 2251-2253. Kirby "… [T]he Government recognises the special situation of Norfolk Island, including the special relationship of the Pitcairn descendants with the Island, its traditions and culture. It is prepared, over a period, to move towards a substantial measure of self government for the Island. It is also of the view that, although Norfolk Island is part of Australia and will remain so, this does not require Norfolk Island to be regulated by the same laws as regulate other parts of Australia. … [T]he Government has decided … to allow the present situation to continue under which laws of the Australian Parliament only apply to this Island if special provision is made in the particular law … The Government's … objective has been to provide for the development of a responsible form of self-government for Norfolk Island." This was the background to the enactment of the 1979 Act. It was that Act that provided for a Legislative Assembly of nine members, to be elected as provided95. In order to be eligible to stand as a candidate for election, and to vote, a person was required to be an Australian citizen, or otherwise to have the status of a British subject; to be 18 years or over; and to be a resident of NI or a holder of an entry permit other than a temporary entry permit and to be capable There were also disqualifications for certain criminal convictions97. The residency requirements for enrolment were subsequently amended. requirements96. satisfying residency specified By the Statute Law (Miscellaneous Provisions) Act (No 1) 1985 (Cth) the requirements for nationality were deleted from the electoral provisions of the 1979 Act98. From 1897 until 1985 it had been a precondition both for candidature and voting, that a person should have the nationality status that was common to natural-born or naturalised electors of the Commonwealth of Australia. However, for reasons that are undisclosed, after nearly a century of its operation, this requirement was abolished. The laws challenged in these proceedings restore a nationality requirement. But they do so in terms confined to Australian citizenship, with no continuing reference to the formerly qualifying status of British subject, and no preservation of the entitlements of those of other nationalities based on residency qualifications alone (save for the continuing right to vote of those already on the NI electoral roll). 95 The 1979 Act, s 31. 97 s 39(1)(b). 98 s 3 and Sched 1. Kirby The issues The central issue in these proceedings is whether the laws that the plaintiffs challenge are supported by s 122 of the Constitution. On the face of things, they appear to be. To consider the contentions to the contrary, it is necessary to address a number of issues that emerged during argument before this Court: Political merits issue: Is the question presented by the plaintiffs essentially a political one99, in the sense that they complain of the imposition by the Australian Parliament of a universal requirement of Australian citizenship for effective participation in the representative democracy of NI? If so, is the complaint one that is outside this Court's function to declare and uphold the law irrespective of its merits? Or is this an instance where, as in much constitutional decision-making, contested political issues merge with legal ones? Textual limitation issue: Does the fact that s 122 of the Constitution includes the express provision permitting "representation of such territory in either House of the Parliament", indicate that any "laws for the government" of a territory such as NI, must provide in a way appropriate to the particular circumstances of the territory, here NI? Given the substantial numbers of non-Australian citizens resident on NI, who have hitherto enjoyed such entitlements, does the attempted alteration of the 2004 Act fail the test of being a "law for the government" of NI? Placement under authority issue: Does the special character of NI as a territory "placed by the Queen under the authority of and accepted by the Commonwealth" carry with it particular constitutional features that support the plaintiffs' objection to the challenged laws, especially given the long history of representative government in the territory that I have outlined? Assumption about territories issue: Do the particular features of the into s 122 an the Commonwealth several "territories" of assumption concerning the nature of laws that may be made for the government of each territory? Specifically, in the case of NI, having regard to its long-established history as a "distinct and separate settlement" and to the enduring provision for a representative law-making body, does a law enacted by the Australian Parliament that diminishes the representative character of the NI Legislative Assembly, by confining import 99 cf joint reasons at [32]. Kirby participation in it to Australian citizens, breach an assumption, inherent in the constitutional grant of power in s 122? Implied limitation on laws issue: If the foregoing questions are answered adversely to the plaintiffs, should this Court, nonetheless, read into the power to make laws for the government of a territory in s 122, an implied limitation restricting the removal of the qualification to participate in the franchise or to be a candidate for election to the Legislative Assembly, from persons who are subjects of the Queen, otherwise than as Australian citizens? International law issue: Is there any applicable provision of international law which, as a matter of context or otherwise, casts light on the resolution of the foregoing issues affecting the relationship between Australia and NI, or any of them? Political questions and constitutional issues An imperfect dichotomy: In a broad sense, all constitutional questions involve political questions100. It is this feature that caused A V Dicey to declare101: "That a federal system … can flourish only among communities imbued with a legal spirit and trained to reverence the law is as certain as can be any conclusion of political speculation. Federalism substitutes litigation for legislation, and none but a law-fearing people will be inclined to regard the decision of a suit as equivalent to the enactment of a law … Hence the citizens become a people of constitutionalists, and matters which excite the strongest popular feeling, as, for instance, the right of Chinese to settle in the country, are determined by the judicial Bench, and the decision of the Bench is acquiesced in by the people … One may well doubt whether there are many states to be found where the mass of the people would leave so much political influence to the courts." In the history of this nation, as of the United States and other federations, many important questions of large political moment have been decided as legal questions, the outcome being determined by the opinion of this Court (sometimes 100 Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 82 per 101 Dicey, Introduction to the Study of the Law of the Constitution, 10th ed (1959) at Kirby by a majority) as to the requirements of the Constitution102. In such matters, judges of this Court and, as Dicey pointed out, "every judge throughout the land"103 decide political questions because they are tendered in a justiciable form. In such cases, judges enjoy no privilege to refrain from giving answers. The fact that the questions are political, or have political connotations or consequences, affords no excuse for inaction. From time to time, this Court must give meaning to constitutional words that require reference to what may be broadly called "political" values. Thus, in Cheatle v The Queen104, the Court unanimously concluded that "the exclusion of women and unpropertied persons" from the jury, required to try indictable federal crimes prosecuted on indictment, was unacceptable to fulfil the "truly representative" character of an Australian jury as contemplated by s 80 of the Constitution "in the more enlightened climate of 1993". Whilst the historical unanimity in the jury's verdict was constitutionally required105, the exclusion of women and unpropertied persons was forbidden. So much was a consequence of constitutional adjudication. There are many other relevant instances106. It follows that giving effect to constitutional requirements in a federation will often, as Dicey recognised, involve political judgments in the broad sense. Indeed, it is difficult to see how arguments relating to the constitutional validity of laws affecting election to the representative institutions of a territory could be discussed without postulating some political characteristics about the polity against which the parties' arguments could be measured107. Nevertheless, judges must obviously be alert to the distinction between deciding whether power exists to enact a law and deciding whether they consider a law, once enacted, is desirable, wise, just or in keeping with historical values or 102 See eg Lee and Winterton, Australian Constitutional Landmarks (2003); New South Wales v The Commonwealth (2006) 81 ALJR 34; 231 ALR 1 is the most recent such decision. 103 Dicey, Introduction to the Study of the Law of the Constitution, 10th ed (1959) at 104 (1993) 177 CLR 541 at 560-561. 105 (1993) 177 CLR 541 at 562. 106 See eg Sue v Hill (1999) 199 CLR 462 at 503 [96], 528 [173], where it was held that the disqualifying expression "subject or a citizen of a foreign power" in s 44(i) of the Constitution now includes a citizen of the United Kingdom. 107 cf Attorney-General (WA) v Marquet (2003) 217 CLR 545 at 607-608 [186]. Kirby conceptions of basic civil rights. Singh v The Commonwealth108 was a case involving the removal from Australia of a girl aged seven who was born here to parents of Indian nationality and who knew no other country. In my reasons in Singh I observed that, if I were a legislator, I would not favour such a course109. However, the duty of a judge, in giving meaning to constitutional concepts, expressed in the basic law of a nation, is to give effect to the meaning of the text as it is understood from its language, history, context and function. its Over the past 30 years and more, debates have occurred in the Australian Parliament, in the NI Legislative Assembly and elsewhere concerning the extent to which NI and the Australian Commonwealth or allowed to retain the "distinct and separate" features out of respect for its geographical isolation, history, and population. In 1974 the Royal Commission report favoured closer legal assimilation. However, as I have observed, the Australian Government and Parliament adopted a different course. The 1979 Act was enacted to give effect to that course. laws should be assimilated into Amongst the preambular paragraphs contained in that Act, the following words still appear on the Australian statute book: "AND WHEREAS the residents of Norfolk Island include descendants of the settlers from Pitcairn Island: AND WHEREAS the Parliament recognises the special relationship of the said descendants with Norfolk Island and their desire to preserve their traditions and culture: AND WHEREAS the Parliament considers it to be desirable and to be the wish of the people of Norfolk Island that Norfolk Island achieve, over a period of time, internal self-government as a Territory under the authority of the Commonwealth and, to that end, to provide, among other things, for the establishment of a representative Legislative Assembly and of other separate political and administrative institutions on Norfolk Island: AND WHEREAS the Parliament intends that within a period of 5 years after the coming into operation of this Act consideration will be given to extending the powers conferred by or under this Act on the Legislative Assembly and the other political and administrative institutions of Norfolk Island, and that provision be made in this Act to enable the results of such consideration to be implemented …" 108 (2004) 222 CLR 322 at 411 [243]. 109 See also Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 219 CLR 365 at 422 [159]. Kirby Later, the 2004 Act was enacted, with provisions (challenged in these proceedings) that, in certain respects, reflect a change of direction. Justiciable politics: The history preceding the enactment of the 2004 Act demonstrates the political issues that, from the time of the earliest settlement of NI, have been illustrated in its government and administration. It could hardly be otherwise. This Court, in these proceedings, cannot avoid a decision, just because what it decides will have political implications. The arguments for the plaintiffs emphasised the importance of preserving the distinctive features of what their counsel called the "community" of NI, a concept never precisely defined. The arguments for the Commonwealth emphasised the importance of upholding the rights of all Australian citizens, ordinarily resident in a territory of the Commonwealth, to the exclusion of non- citizens, to vote in elections for the Legislative Assembly of that territory and to be candidates for such election. The fact that the issues are political does not afford this Court a reason for declining a constitutional answer. Yet it does oblige the Court, so far as it can, to proffer an answer that conforms as closely as possible to the constitutional text, read in the light of history, identified matters of context and the decisional authority that casts light on the meaning of s 122 as it applies to NI. Textual argument: the government of the territory The argument stated: The plaintiffs recognised the difficulty they faced because of the generality of the language of s 122 of the Constitution. Self- evidently, the provisions in the section empowering the Parliament to "make laws for the government of any territory" are expressed in extremely broad terms. They are not stated (as the powers of the Parliament contained in ss 51 and 52 are) to be "subject to this Constitution". Nevertheless, being themselves part of the Constitution, it is inherent from the context, that they will be so read. The usual words of a grant of power to make laws "for the peace, order and good government of the Commonwealth" are also missing. However, this Court has repeatedly held that those words are not words of limitation. They do not mean that laws that are arguably unjust or contrary to basic rights may be disallowed or read down110. The grant in s 122 is not expressed as a "power" to make laws "with respect to" particular and specified subject matters. Instead, the subject of permissible law-making is nothing less than "laws for the government of any territory". Because of its language and purpose, the width of that power has been 110 Union Steamship Co of Australia Pty Ltd v King (1988) 166 CLR 1 at 9; Durham Holdings Pty Ltd v New South Wales (2001) 205 CLR 399 at 408-409 [9], 424-425 [55]; cf R (Bancoult) v Foreign Secretary [2001] QB 1067 at 1102-1104 [53]-[56]. Kirby repeatedly described as very broad. Thus in Teori Tau v The Commonwealth111, which survived a challenge to its authority in Newcrest Mining (WA) Ltd v The Commonwealth112, the whole Court said113: "Section 122 of the Constitution of the Commonwealth of Australia is the source of power to make laws for the government of the territories of the Commonwealth. In terms, it is general and unqualified … The grant of legislative power by s 122 is plenary in quality and unlimited and unqualified in point of subject matter." These words have been repeated many times114. Nevertheless, the power is not completely uncontrolled. Limits exist in the language of the grant (eg in the power to make laws "for" the government of the "territories of the Commonwealth"). The "territories" are themselves geographically identified. In Capital Duplicators Pty Ltd v Australian Capital Territory115, Brennan, Deane and Toohey JJ point to the fact that s 122 is found in Ch VI of the Constitution ("New States"), a part of the Constitution which (in ss 123 and 124) envisages not only "territories" that are part of existing States but also "such colonies or territories as may be admitted into or established by the Commonwealth as States"116. Their Honours go on117: "In the Convention Debates, the forerunner of s 122 was seen primarily, though not necessarily, as designed to provide for the provisional government of territories as they moved towards Statehood. When the Commonwealth was established there were no Commonwealth territories. 111 (1969) 119 CLR 564. 112 (1997) 190 CLR 513. 113 (1969) 119 CLR 564 at 570 per Barwick CJ, McTiernan, Kitto, Menzies, Windeyer, Owen and Walsh JJ. 114 See eg Northern Land Council v The Commonwealth (1986) 161 CLR 1 at 6; Capital Duplicators Pty Ltd v Australian Capital Territory (1992) 177 CLR 248 at 269 per Brennan, Deane and Toohey JJ. 115 (1992) 177 CLR 248 at 271. 116 Constitution, covering cl 6. 117 (1992) 177 CLR 248 at 271 (footnotes omitted). Kirby At that time the territories which were foreseen as possible territories of the Commonwealth included not only the northern territory of South Australia but also the Fiji Islands and British New Guinea. The possibility of territories of magnitude and importance being admitted to the Commonwealth as new States after a period of political development must have been contemplated." It was on this footing that, in Berwick Ltd v Gray, the Court upheld the power of the Australian Parliament "to endow a Territory with separate political, representative and administrative institutions, having control of its own fiscus"118. Once such a power is acknowledged, the provision of laws to govern the conduct of elections for such institutions becomes essential. And that was how the Commonwealth characterised the laws that the plaintiffs challenge in these proceedings. The textual contentions: The plaintiffs latched onto two features of the language of s 122 in order to mount their argument that the impugned provisions of the 2004 Act were beyond the power to make laws "for the government of" NI. First, they argued that the "territory", for the government of which such laws might be made, imported, in each case, the character of the particular "territory" concerned. In part, this argument was founded on the variety of ways in which a "territory" could become such under the Constitution. Thus, it may be "surrendered by any State to and accepted by the Commonwealth". Within this category the Northern Territory of Australia (surrendered by South Australia119) and the Australian Capital Territory and Jervis Bay Territory (surrendered by New South Wales)120. Then there are territories "placed by the Queen under the authority of and accepted by the Commonwealth". NI is a territory in this class as, earlier, was Papua, which (by the name British New Guinea) was placed under the authority of the Commonwealth by Letters Patent issued by Edward VII dated 18 March 1902 and accepted by the Papua Act 1905 (Cth)121. Finally, there is the third class of "territory" being those "otherwise 118 (1976) 133 CLR 603 at 607 per Mason J. See Capital Duplicators Pty Ltd v Australian Capital Territory (1992) 177 CLR 248 at 266, 272. 119 Constitution, s 111; Northern Territory Acceptance Act 1910 (Cth); cf Svikart v Stewart (1994) 181 CLR 548 at 565. 120 Seat of Government Acceptance Act 1909 (Cth); Jervis Bay Territory Acceptance Act 1915 (Cth). See The Commonwealth v Woodhill (1917) 23 CLR 482 at 121 Re Minister for Immigration and Multicultural Affairs; Ex parte Ame (2005) 222 CLR 439 at 446-447 [5]. Kirby acquired by the Commonwealth", amongst which, arguably, was the mandated (later trusteeship) territory of New Guinea (formerly German New Guinea)122. The plaintiffs submitted that the variety of ways in which "territories" could be created, and thus come under the control of the Commonwealth within the contemplation of s 122, indicated that "territories", of their respective origins, needs, locations, ethnic composition, population (if any) and history, were likely to be different. On the face of the Constitution, it was argued, "laws for the government" of such "territories" would necessarily adjust in their permissible content so as to meet the "governmental" requirements of each territory concerned. In support of this proposition, the plaintiffs pointed to the different ways in which this Court had approached the rights of the inhabitants of some territories as against those of others. They emphasised what was said in the joint reasons of the Court in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame, a case concerned with the termination of Australian "citizenship" rights previously extended to the indigenous people of Papua123: "[Section 122] covers both internal and external Territories, including territories 'otherwise acquired by the Commonwealth'. It was pointed out in Fishwick v Cleland124 that, in the context, acquisition is a broad and flexible term covering developing conceptions of the authority of the Crown in right of Australia over external territories. In that case it was held to cover authority over the territory of Papua New Guinea. The variety of circumstances and conditions that could apply to territories within the contemplation of s 122 was considered in Re Governor, Goulburn Correctional Centre; Ex parte Eastman." The passage referred to in Re Governor, Goulburn Correctional Centre; Ex parte Eastman125 lists the "disparate nature" and variety of the territories of the Commonwealth. It concludes126: 122 Fishwick v Cleland (1960) 106 CLR 186 at 197. 123 (2005) 222 CLR 439 at 456-457 [27]. 124 (1960) 106 CLR 186 at 197-198. 125 (1999) 200 CLR 322 at 331 [7]. 126 (1999) 200 CLR 322 at 331 [7]. Kirby "There have been various circumstances in which external territories have come to be under the authority of the Commonwealth. In R v Bernasconi, for example, Isaacs J referred to 'recently conquered territories' with German and Polynesian populations127. The territories have been, still are, and will probably continue to be, greatly different in size, population, and development. Yet they are all dealt with, compendiously and briefly, in From this suggested recognition of the necessity to adapt s 122 to the particular needs of individual territories, the plaintiffs argued that "laws for the government of" a territory, such as NI, were inherently required to conform to the governmental circumstances appropriate to such a territory. The relevant features of geography, population, history, representative institutions and distinctiveness were, so it was argued, incorporated into the Constitution by the recognition in s 122 itself of the distinctive features of different territories of the Commonwealth. This argument was then reinforced by a second one. Although the Parliament might validly decide to make no laws at all for the establishment of an elected representative institution for a territory such as NI, if it were to do so it was bound to provide a form of representative institution that was harmonious with the peculiar and unique needs of the community living in that territory. In support of this argument, the plaintiffs relied on two textual considerations. The first appears in the closing words of s 122. Those words are additional to the power to make laws for "the government of any territory". But they supplement that power and provide: "… and [the Parliament] may allow the representation of such territory in either House of the Parliament to the extent and on the terms which it thinks fit." In respect of the territories of the Commonwealth, different provisions have been enacted since 1974 for the representation in the Australian Parliament of electors in such territories. So far as concerns the two internal self-governing territories (the Australian Capital Territory and the Northern Territory of Australia), provisions have been enacted, and upheld by this Court, for their representation in the Senate128 and in the House of Representatives129. In respect of electors on NI also, a complicated provision exists in s 95AA of the 127 The King v Bernasconi (1915) 19 CLR 629 at 638. 128 Western Australia v The Commonwealth (1975) 134 CLR 201. 129 Queensland v The Commonwealth (1977) 139 CLR 585. Kirby Commonwealth Electoral Act permitting a "'qualified' Norfolk Islander" to be enrolled for an electoral subdivision within Australia or a one-territory division, as the case may be. The plaintiffs submitted that the specific contemplation of representation of electors resident in the territories (without express precondition as to their nationality), and the inclusion of s 122 in the Constitution containing many detailed provisions for democratic, representative and responsible government, meant that the apparently plenary language empowering the Parliament to "make laws for the government of any territory" had to be read in a particular way. In short, if any law on the subject were to be made, it had to be a law compatible with the fundamental postulate that the law-making body so created would be truly accountable to, and representative of, the community that existed in the territory. It could not be accountable to, and representative of, part only of that community. Nor could it impose conditions that excluded a significant proportion of the people of the territory on grounds of their nationality. Neither could it impose conditions requiring acquisition of a different nationality, which a significant number of members of that community might not wish to do. Textual incapacity: The textual argument advanced for the plaintiffs cannot succeed. Whilst it is true that the "territories", contemplated as falling within s 122 of the Constitution, varied in their geographical connection with the Australian mainland; historical links with its governance; population size; ethnic similarity or dissimilarity to the Australian people; and cultural and economic needs, there still remain fundamental commonalities. For such fundamentals, a single criterion for Australian federal laws is provided. The word "territory" in s 122 of the Constitution must be afforded a meaning, large and broad enough to cover all applicable territories in all reasonably imaginable circumstances. This is why the phrase "laws for the government of any territory" cannot, as a textual matter, be read down so as to import limiting notions derived from history. A more attractive argument for the plaintiffs was that which invoked the closing words of s 122, and the postulate of representation in either House of the Australian Parliament, to cast suggested light on the meaning to be given to the phrase "laws for the government of any territory" appearing earlier in the section. The postulate can be tested thus. If the Australian Parliament enacted a law restricting participation in elections in NI to male residents only (of a kind that was temporarily restored when, after 1897, NI reverted to an all-male electorate of "Elders"), it is doubtful that such a provision would now be upheld by this Court as a valid law of the Australian Parliament. Because a territory such as NI is contemplated by s 122 as being one in respect of which "representation" in the Australian Parliament might be allowed, any form of representative government enacted by federal law and practised in NI would have to be such as rendered the Kirby territory potentially suitable for representation in the kind of Parliament created for the Commonwealth130. However, when the laws challenged in these proceedings are considered, they make no such impermissible distinction. They exclude non-Australian citizens from election to the Legislative Assembly of NI. As Sue v Hill131 found, s 44(i) of the Constitution is now to be read as requiring Australian citizenship as a precondition to being eligible for election to the Australian Parliament. Moreover, so far as electors of the Commonwealth are concerned132, whilst a residual category of electors (still quite large) entitled to participate in voting for the House of Representatives and the Senate comprises British subjects who are permanent residents but not Australian citizens, that category was closed with the electors of this description whose names were on the Australian electoral roll immediately before 26 January 1984133. Accordingly, the introduction of the Australian citizenship requirement for NI is no more than one way of bringing the electoral requirements in that territory of the Commonwealth into harmony with the requirements now operating elsewhere in that polity. It is true that the natural person plaintiffs are not presently Australian citizens. It is also true that, at the last census of Norfolk Island, 17.7% of the ordinarily resident population were New Zealand citizens and 0.9% citizens of the United Kingdom134. In such a small cohort of adult people (1863 in all) the potential impact of the exclusion of non-Australian citizens on voter eligibility is comparatively large. In effect, it may coerce those so excluded to secure Australian citizenship, which they might not otherwise desire. On the other hand, NI is a territory of Australia. The imposition of the requirement of Australian citizenship has been a common feature of several recent Australian laws and of decisions of this Court135. It cannot therefore be said that, in this respect, the "community" of NI has been singled out for unfair discrimination. 130 An argument by analogy with Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51. 131 Sue v Hill (1999) 199 CLR 462. 132 The expression "elector" is used in the Constitution. See eg ss 8, 30, 128. 133 Commonwealth Electoral Act, s 93(1)(b)(ii). See Re Patterson (2001) 207 CLR 134 Norfolk Island, Census of Population and Housing, 8 August 2006 at 24. 135 See eg Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178; Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28; Singh v The Commonwealth (2004) 222 CLR 322; cf Re Patterson (2001) 207 CLR Kirby Further, recent amendments to Australian citizenship law, in company with similar changes in other countries, permit dual citizenship, removing the sometimes painful obligation to lose one nationality in order to acquire another136. And it is not unusual for participation in the electoral process within a nation state to be conditioned on nationality. Conclusion: amplitude of s 122: It follows that, on the face of things, the answer to the textual arguments advanced for the plaintiffs must be analogous to that given in Singh v The Commonwealth137. So long as NI is, and remains, a territory of the Commonwealth, it is open to the Australian Parliament to conclude that the imposition of requirements of Australian citizenship for candidature for election to the NI Legislative Assembly created by that Parliament, and for future voters wishing to be enrolled to elect that Assembly, is a law "for the government of" that territory. Moreover, having regard to concurrent legal developments of recent years, it is a law harmonious with the requirements of representative government under the Constitution as it is now understood and applied. Such laws do not exceed the provisions of s 122. Nor do they offend the general character of the Constitution so far as it provides for elected representative governmental institutions. Acquisition does not import a limitation A possible argument: But can it be said that the mode of acquisition of this particular territory, so that it became a territory of the Commonwealth, brought with it unexpressed features that render it constitutionally impermissible for the Australian Parliament potentially to deprive more than 18% of the population from participation in the representative institution by which many of the territory's laws are made? Is this just a political complaint, about which this Court can do nothing? Or does it invoke a justiciable legal norm? Crown fiduciary duty?: Two conceivable foundations exist for the argument. The first can be quickly dismissed. It rests on a suggestion that the Crown owes the people resident on NI a duty, in the nature of a fiduciary obligation that it would breach if it failed to ensure that the Australian Parliament continued to recognise the right of participation of residents in the elected representative body of NI, as had been enjoyed since at least Governor Denison's proclamation of the thirty-nine laws in 1857. 136 Australian Citizenship Legislation Amendment Act 2002 (Cth), Sched 1, Item 1. See Sue v Hill (1999) 199 CLR 462 at 529 [176]. 137 (2004) 222 CLR 322. Kirby It is true that there are some features of the historical material referred to in the Special Case that suggest the recognition of particular obligations on the part of the Crown to the inhabitants of NI. These include the unusual history of settlement; its abandonment and resettlement; and the removal to NI of most of the settlers from Pitcairn Island, another Crown possession. The successive arrangements by the Crown to connect NI with other British possessions, culminating in the action of the King in placing NI under the authority of the Commonwealth, might be thought to reflect a developing sense of Imperial obligation. The Order in Council of 24 June 1856 specifically talks of the grant of land "in trust for the public use" of subjects of the Crown resident on NI. So is there a trust obligation more generally which defends the right of residents such as the plaintiffs to partake in the representative institution of NI? Is it legally enforceable? In Canada, the courts have recognised the existence of a fiduciary duty with respect to the lands and rights of indigenous peoples138. Land surrendered to the Crown by indigenous groups has been treated as subject to a trust-like relationship. Indeed, it has been concluded that the Crown has a broader responsibility to act in a fiduciary way towards indigenous peoples arising out of its historical powers over, and assumption of responsibility towards, such peoples within its protection. This duty has been held to have passed from the Crown in right of the United Kingdom to the modern government of Canada139. These authorities broadly follow decisions of the Supreme Court of the United States on the same subject matter140. If, because of their vulnerability and dependency, such a relationship might be established with indigenous peoples, it would not be hard to imagine the creation of a similar relationship with the resident population of NI, having regard to its history, isolation, small numbers, and economic as well as cultural dependency. The plaintiffs did not expressly rely on such an argument. In the context of Australia, the argument draws little support from the cases on the rights of 138 Guerin v The Queen [1984] 2 SCR 335 at 375-376. 139 R v Sparrow [1990] 1 SCR 1075 at 1108. The provisions of s 35(1) of the Canadian Constitution were held to be relevant; cf Semiahmoo Indian Band v Canada (1997) 148 DLR (4th) 523 at 536-537 but see Breen v Williams (1996) 186 CLR 71 at 82, 92-93, and 106-107. 140 Cherokee Nation v Georgia 30 US 1 (1831); Worcester v Georgia 31 US 515 (1832); United States v Kagama 118 US 375 at 383-384 (1886); Seminole Nation v United States 316 US 286 at 296-297 (1942); United States v Mitchell 463 US Kirby indigenous peoples. In Mabo v Queensland [No 2]141, Toohey J alone found a fiduciary relationship between the Crown and Australian Aboriginals. Although, in my opinion, the issue is still an open one, there are many impediments in the way of constructing from it a legally enforceable barrier to the enactment of the laws challenged in these proceedings. Whatever duties the Crown might have in its various manifestations, they are necessarily subject to any laws made by the Crown in Parliament. The Constitution was originally enacted as such a law142. Section 122 of the Constitution, thus enacted, expressly contemplated and authorised the placement of a territory by the Queen under the authority of the Commonwealth, once that placement was accepted by it. This was duly accomplished in the case of NI. Thereafter, any obligation of the Crown or of the Commonwealth to the residents of NI was subject to laws validly made "for the government of" the territory. Neither expressly nor impliedly are any fiduciary duties owed by the Crown to the territory or its people preserved so as to disable the Australian Parliament from the full enjoyment of its express constitutional law-making powers. Because the point was not taken further and has been described as one of "fundamental importance"143, it should not be determined in the abstract. I will not pursue it further. Obligations to a settled colony?: Can it be said, alternatively, that the challenged laws offend a basic principle of British constitutional law that, once a form of self-government is given to a colony of the Crown, acquired by settlement, it cannot be taken away? Words to that effect may be found in respected texts on constitutional law and history. Thus, Maitland, in The Constitutional History of England144, records the differences between territories acquired by colonisation, on the one hand, and by cession or conquest, on the other. In some circumstances, Maitland states: "The king … may grant … representative institutions of their own – may establish in them legislative assemblies – and when such a grant has been made he cannot revoke it." 141 (1992) 175 CLR 1 at 203. 142 Commonwealth of Australia Constitution Act 1900 (Imp) 63 & 64 Vict c 12. 143 Northern Land Council v The Commonwealth [No 2] (1987) 61 ALJR 616 at 620; 75 ALR 210 at 215. 144 Maitland at 337. Kirby However, there are both factual and legal difficulties in the way of importing any such doctrine to support the plaintiffs' arguments in this case. As to the facts, whatever the classification of NI (and it was probably by 1857, a "settled" colony), it cannot really be said to have received a relevant measure of self-government before the 1979 Act and then from the Australian Parliament. The earlier laws for various kinds of representative body, whilst undoubtedly participatory and in certain ways in advance of developments elsewhere, could not qualify as establishing representative institutions of government. They were, for the most part, advisory to the Governor or Administrator as the case might be. In any case, in all but the 19 years before the 2004 Act145, a nationality requirement for participation was expressly provided. For most of those years, it was the common nationality status of British subject. As the review of legislation that I have set out above demonstrates, a qualification based relevantly on residence on NI only existed in the earliest years (when British nationality could be assumed) or in the years between 1985 and 2004 (when a nationality requirement was temporarily removed). It follows, on the evidence, that the absence of a nationality requirement cannot be portrayed as a longstanding or established (still less ancient) feature of NI's governance, such that it has been imprinted on the text of s 122 of the Constitution, between the lines as it were. In any case, there are insuperable legal difficulties for any such contention. The rule against the revocation of representative assemblies, once granted, appears to have related only to those resident in territories conquered by the King's armies or ceded by a foreign power146. In the times of Empire, settlers knew that they were ultimately "subordinate unto, and dependent upon the Imperial Crown and Parliament of Great Britain"147. This, as Maitland points out, was the complaint of the American colonies; not that the British Parliament lacked power to legislate for them but that it had wrongly exercised its power148. Secondly, whereas the King might in some circumstances have been unable to revoke grants of representative institutions, once made149, this 145 Since the amendments effected by the Statute Law (Miscellaneous Provisions) Act (No 1) 1985 (Cth). 146 Maitland at 337. See Sammut v Strickland [1938] AC 678 at 702. 147 See 6 Geo III c 12 (1765). 148 Maitland at 338. 149 Campbell v Hall (1774) 1 Cowp 204 at 208 [98 ER 1045 at 1047] per Lord Mansfield, delivering the reasons of the Court. Kirby incapacity did not extend to an Act of the British Parliament, at least before the Statute of Westminster 1931, adopted after the Imperial Conferences held in 1926 and 1930150. At the time of the enactment of the Commonwealth of Australia Constitution Act, there was no legal impediment to the United Kingdom Parliament's providing as it saw fit in respect of any representative institution previously granted by the Crown or established by or under earlier legislation. Thirdly, in so far as the successive representative institutions for NI were concerned, as made in the 19th century by or under Orders in Council, such Orders invariably reserved the Royal Prerogative to issue new and different Orders in Council in the future. Thus, in the paragraph of the Order in Council of 24 June 1856, in which it was "ordered and declared" that NI was "a distinct and separate settlement", the ensuing orders made for that purpose were expressly declared to exist "until further Order"151. The Order in Council that placed NI under the authority of the Commonwealth pursuant to s 122 of the Constitution was one such "further order". Fourthly, and in any case, once placed under the authority of the Commonwealth, and accepted by it, there was a new legal beginning. The law- making source then took its validity from the Constitution itself. The ultimate foundation for that Constitution is the acceptance of its requirement by the Australian people152. This fact directs attention to the language and purpose of s 122 of the Constitution. Such considerations, appearing as they do in a constitutional grant of power to make further laws, support the most ample construction of the power thus afforded. This is the construction that this Court has repeatedly given to s 122. The decision in Newbery: Many of the foregoing issues were considered by the Supreme Court of Norfolk Island in 1965 in Newbery v The Queen153. In that case, the appellant applied for leave to appeal against his conviction for failing to apply for enrolment on the NI Council electoral roll, contrary to s 11(2) of the Norfolk Island Council Ordinance 1960. The challenge was based on the argument that the Ordinance was invalid and that the only valid electoral law of 150 Adopted for Australia by the Statute of Westminster Adoption Act 1942 (Cth). 151 Order in Council, 24 June 1856, entered and recorded 16 September 1857. 152 Kirmani v Captain Cook Cruises Pty Ltd [No 1] (1985) 159 CLR 351 at 441-442; Breavington v Godleman (1988) 169 CLR 41 at 123; Leeth v The Commonwealth (1992) 174 CLR 455 at 485-486; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 138; and McGinty v Western Australia (1996) 186 CLR 140 at 230. 153 (1965) 7 FLR 34. Kirby NI was that contained in the thirty-nine laws of 1857. That argument was, in turn, founded on the proposition that the 1857 laws had the effect of granting to the settlement of NI a constitution and a legislature, which could not thereafter be revoked or amended by the Crown nor ignored by the conduct of the Crown in placing NI under the authority of the Commonwealth so as to attract s 122 of the Constitution. The argument was dismissed by Eggleston J. His Honour found that the successive Orders in Council made for the government of NI between 1856 and 1900 were fully effective within the powers granted to the Crown by the Waste Lands (Australia) Act and successively reserved in the Orders made from time to time154. As well, Eggleston J noted that the thirty-nine laws of 1857 were not made directly by Orders in Council in the United Kingdom but by the Governor of New South Wales, acting under such authority. The Order in Council of 1914, placing the territory of NI under the authority of the Commonwealth, was also held to be within the power granted by the Waste Lands (Australia) Act to "make provision for the government" of NI. The similarity between that Imperial grant and the grant of governmental power expressed in s 122 of the Constitution, pursuant to which the territory of NI was accepted by the Commonwealth, is striking. The analysis of Eggleston J is compelling. No error has been shown in it. Conclusion: no legal objection: It follows that any pre-existing rule of the Royal Prerogative or of the obligations of the Crown, by common law or equity, that applied before NI became a territory of the Commonwealth cannot diminish the power and authority granted to the Australian Parliament by s 122 of the Constitution. Any complaint about the alteration of the representative arrangements for the "community" on NI is thus not a legal one. It is one addressed to the political wisdom and justice of the 2004 Act. They are considerations that this Court has no authority to adjudicate. In the result, neither an argument based on any suggested fiduciary duty of, or disqualification attaching to, the Crown (assuming such duty or disqualification to have existed) can be invoked in this case to diminish the ample constitutional power and authority of the Australian Parliament under the Constitution to make laws for the government of NI. Any contention to the contrary must be rejected. No shared assumption or implied restriction is found Assumptions and implications: The plaintiffs preferred to put their arguments concerning the limitations on the law-making power of the Australian Parliament on the basis that they amounted to an "unexpressed assumption" 154 (1965) 7 FLR 34 at 41. Kirby within s 122 rather than a limitation to be grafted onto the constitutional language. The distinction between these two concepts was noted by Mason CJ in Australian Capital Television Pty Ltd v The Commonwealth, where his Honour said155: "It is essential to keep steadily in mind the critical difference between an implication and an unexpressed assumption upon which the framers proceeded in drafting the Constitution. The former is a term or concept which inheres in the instrument and as such operates as part of the instrument, whereas an assumption stands outside the instrument. Thus, the founders assumed that the Senate would protect the States but in the result it did not do so. On the other hand, the principle of responsible government – the system of government by which the executive is responsible to the legislature – is not merely an assumption upon which the actual provisions are based; it is an integral element in the Constitution." When the plaintiffs were confronted with the difficulty of deriving an implied limitation from the very broad language of s 122 of the Constitution, they suggested that such a difficulty was not significant because the word "territory" was written in that context upon a footing which imported the variety of territorial conditions and their several needs for representative government. In this sense, so it was put, the limitation relevant to representation of the "community" of NI was inherent in the very grant of power to "make laws for the government of" such a "territory". For the reasons already given, there are insuperable factual and legal difficulties in the way of accepting this argument. It should be rejected. An implied limitation?: But can an implication be grafted onto the words in s 122 of the Constitution because of the general character of the Constitution as a charter for representative government that adapts to the conditions of the State or Territory concerned? Is the implication effectively imported by the very variety of territories, contemplated on the face of the Constitution and revealed by its operation? Is an implication protective of the right of all long-term residents on NI, regardless of their nationality, inherent in such a small population and in the contextual reference in s 122, to "the representation of such territory in either House of the Parliament"? The difficulty facing the plaintiffs in importing any such implied limitation arises not only out of the generality of the plain words of s 122 but also from the purpose of the section as one granting a power to make laws for all 155 (1992) 177 CLR 106 at 135 (footnotes omitted). Kirby future needs of the government of every variety of territory that becomes a governmental responsibility of the Commonwealth. The language and context militate strongly against the super-imposition of a limitation by implication, such as the plaintiffs suggested. As well, in a number of recent decisions, this Court has emphasised the restraints that exist on drawing implications from the Constitution that are not based on its actual terms or structure156. The criterion commonly adopted is necessity to give effect to other constitutional provisions157. Such necessity may be "logical or practical" or "implicit in the federal structure"158. Considerations of appropriateness or the avoidance of discrimination or arguable injustice will not ordinarily be sufficient, of themselves, to justify imposition of an implied limitation on the constitutional text159. The difficulty of amending the Constitution is one reason for caution in importing such implications160. Care also has to be exercised in converting verbal explanations for decisions in one case into rigid universal criteria161. As well, Windeyer J in Victoria v The Commonwealth162 reminded us that "implications have a place in the interpretation of the Constitution". He recalled Dixon J's declaration: "I do not see why we should be fearful about making implications"163. This was something Dixon J did with great effect in the Communist Party Case164. The Court also upheld implications based on the structure of the Constitution in the 156 McGinty v Western Australia (1996) 186 CLR 140 at 168-169. 157 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567; Kruger v The Commonwealth (1997) 190 CLR 1 at 152. 158 Durham Holdings Pty Ltd v New South Wales (2001) 205 CLR 399 at 410 [14]. 159 Durham Holdings Pty Ltd v New South Wales (2001) 205 CLR 399 at 432 160 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 485 161 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 453-454 162 (1971) 122 CLR 353 at 401. 163 Australian National Airlines Pty Ltd v The Commonwealth (1945) 71 CLR 29 at 164 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193. Kirby Boilermakers' Case165 and many others. In recent years, this Court has rejected various suggested constitutional implications, making only one significant exception in Austin v The Commonwealth166, protective of State judicial pensions. They were protected on the ground, found by the majority, that a federal income tax law of general application placed a particular disability or burden on the operations and activities of the States concerned167. An implied prohibition?: When the 2004 Act is examined, it does not in my view, suggest the existence of an implied prohibition, or limitation, on the generality of the language in s 122 of the Constitution, special to a territory such as NI. At no stage did the plaintiffs formulate with precision any such implied limitation. Nor could they demonstrate its necessity or inherent likelihood, compatibly with the language and purpose of s 122. Moreover, it is not only legal doctrine that weighs against finding an implied limitation in s 122 relevant to these proceedings. The facts themselves do not support a need for it. The provision of a requirement of nationality to vote in NI elections, and to be a candidate, lasted for most of the history of NI before 1985. Given the change in Australia and elsewhere of the applicability of the status of British subject and the introduction from 1984 of the requirement that new voters in federal elections must be Australian citizens, it was open to the Australian Parliament to conclude that a similar provision for elections in NI represented a "law for the government of" a territory. The supervening intervention of the facility for dual nationality, and the fact that all but 2% of the population of NI who are not already Australian citizens are citizens of New Zealand or the United Kingdom (for whom acquiring Australian citizenship ordinarily constitutes no special burden) sustains the conclusion that the imposition of that requirement was a choice validly open to the Australian Parliament within its powers under s 122 of the Constitution168. To adapt what was said by Gleeson CJ and Heydon J in APLA Ltd v Legal 165 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270. However, Williams, Webb and Taylor JJ each dissented and the precise ambit of the implication remains controversial. See The Queen v Joske; Ex parte Australian Building Construction Employees and Builders' Labourers' Federation (1974) 130 CLR 87 at 90, 102. 166 (2003) 215 CLR 185. Contrast New South Wales v The Commonwealth (2006) 81 ALJR 34 at 90 [194], 141 [471]-[472]; 231 ALR 1 at 58-59, 127-128. 167 Applying the implied prohibition described by Dixon J in Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 79. 168 cf Sue v Hill (1999) 199 CLR 462 at 529 [176] per Gaudron J. Kirby Services Commissioner (NSW)169, there is nothing in the text or structure of the Constitution, or in the nature of the territories power, that requires that candidates or voters must be able to participate in territory elections, including NI elections, although non-citizens of Australia whose Constitution applies to that territory. "It may or may not be thought desirable, but it is not necessary"170. The topic is one171: "… on which the Constitution has nothing to say in express terms. If it is said to be a matter of implication, then it is necessary to identify, with reasonable precision, the suggested implication. This has not been done." Such a conclusion may be reached without venturing upon the question, agitated by the plaintiffs, as to whether NI is, or is not, "part of the Commonwealth". I agree with the joint reasons that the answer to that question depends on the purpose for which the question is asked172. Nor, in the light of the foregoing, is it necessary to define with greater precision than the plaintiffs did who precisely constitute the NI "community". There is no apparent magic in any of the residency requirements that have been adopted under successive NI laws in this regard. Least of all do any of the varying requirements for residency qualifications to be a candidate or voter in elections on NI suggest a necessary provision that constitutes an implied constitutional precondition upon the power stated in s 122. Conclusion: No assumption or implication: It follows that no inherent assumption or implied limitation can be recognised to immunise the undefined "community" of NI from the requirements now adopted by the Australian Parliament that candidates and future voters for elections on NI must be Australian citizens. The provisions of the 2004 Act to that effect are valid laws of the Australian Parliament. They are fully sustained by s 122 of the Constitution. International law suggests no different outcome The status of international law: In this Court, a controversy exists concerning the extent to which it is permissible, or appropriate, to have regard to international law, including the international law of universal human rights, in 169 (2005) 224 CLR 322 at 352 [33]. 170 (2005) 224 CLR 322 at 352 [33]. 171 (2005) 224 CLR 322 at 352 [32]. 172 Joint reasons at [36]. Kirby interpreting the provisions of the Constitution. In a number of decisions, I have concluded that regard may now be had to such considerations, where relevant, as part of the legal context in which the Constitution now operates, and must be understood173. In his reasons in Al-Kateb v Godwin174, McHugh J expressed the opinion that in Australian constitutional interpretation, international law is irrelevant. This is not a case in which to continue that debate. Human rights and elections: Nevertheless, as in Attorney-General (WA) v Marquet175, it may be observed that the conclusion reached as to the meaning and application of s 122 of the Constitution, in the respect challenged by the plaintiffs in these proceedings, does no offence to the requirement of universal principles of human rights adopted by the international community. In the Universal Declaration of Human Rights176, Art 21 expresses principles which, although not in the form of a binding treaty, have greatly influenced subsequent developments of international law. Although stated in terms (as most of the articles are) addressed to the rights of "everyone", in the case of democratic participation, the principle is limited to application to the person's own country: "21.1 Everyone has the right to take part in the government of his country, directly or through freely chosen representatives. 21.3 The will of the people shall be the basis of the authority of government; this will shall be expressed in periodic and genuine elections which shall be by universal and equal suffrage and shall be held by secret vote or by equivalent free voting procedures." 173 Al-Kateb v Godwin (2004) 219 CLR 562 at 617-630 [152]-[193]. See also Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 658. As to State Constitutions, see Attorney-General (WA) v Marquet (2003) 217 CLR 545 174 Al-Kateb (2004) 219 CLR 562 at 589-595 [62]-[74]. 175 (2003) 217 CLR 545 at 603-606 [173]-[181]. 176 The Universal Declaration of Human Rights was adopted and proclaimed by the General Assembly of the United Nations, Resolution 217A(III) of 10 December Kirby In the later elaboration of these human rights in the International Covenant on Civil and Political Rights ("ICCPR")177, the qualification "of his country" has been made still clearer by restricting the right of democratic participation to citizens. Art 25 provides178: "Every citizen shall have the right and the opportunity, without any of the distinctions mentioned in article 2 and without unreasonable restrictions: To take part in the conduct of public affairs, directly or through freely chosen representatives; To vote and to be elected at genuine periodic elections which shall be by universal and equal suffrage and shall be held by secret ballot, guaranteeing the free expression of the will of the electors; The forbidden distinctions in Art 2 of the ICCPR are described as being "of any kind, such as race, colour, sex, language, religion, political or other opinion, national or social origin, property, birth or other status". In reconciling the forbidden distinction of "national … origin" with the pre-condition of citizenship stated in Art 25, it is clear that unreasonable impediments to attaining citizenship because of "national origin" are forbidden. However, the requirement of citizenship for the enjoyment of the rights to vote and to be elected to a representative governmental body are recognised in the civil rights adopted by the international community. 177 The ICCPR was adopted and opened for signature, ratification and accession by General Assembly Resolution 2200A(XXI) of 16 December 1966. It entered into force 23 March 1976 in accordance with Art 49. It entered into force in Australia on 13 November 1980 [1980 ATS 23]. The First Optional Protocol to the ICCPR entered into force generally on 23 March 1976 in accordance with Art 9 and in Australia on 25 December 1991 [1991] ATS 39. 178 Unsurprisingly, in consequence of the language of Art 25 of the ICCPR, the decisions of the United Nations Human Rights Committee are expressed in terms of the rights of citizens. See General Comment 25 of the Committee on Art 25(b), noted in Joseph, Schultz and Castan, The International Covenant on Civil and Political Rights, (2004) at 659; cf Gillot et al v France (UNHCR 932/2000) (voting in the French colony of New Caledonia subject to residency restrictions was upheld as appropriate to the exercise of a right to self-determination under Art 1 of the ICCPR). See Joseph, Schultz and Castan at 660 [22.22]. Kirby In most parts of the world, the pre-condition of citizenship is taken for granted. If there have been exceptions in Australia, New Zealand, the United Kingdom and NI in the past, it is only because of the universal notion of the nationality of British subjects, which proved so durable. That was a feature of the electoral law of Australia and NI until the 1980s. It lingers on to some extent for those already on the electoral roll before the pre-condition of Australian citizenship was substituted. But it is now treated by the Parliament as an historical anomaly. It is now being generally replaced by requirements of Australian citizenship. Conclusion: no offence: In the result, there is no offence to international human rights law in the language and meaning of s 122 of the Constitution, as interpreted by this Court, in upholding the validity of the 2004 Act provisions mandating Australian citizenship for participation in future NI elections. The latter provision is not incompatible with international law as stated in the ICCPR or with the standards adopted by other civilised countries. No demonstrated departure from international law in this respect suggests a need to re-examine the outcome that is now derived from the application of Australian municipal law. Although during submissions some mention was made of other provisions of international law179, these were not elaborated in argument. I will not therefore pursue them. Outcome and orders All of the plaintiffs' challenges to the validity of the 2004 Act having failed, the questions reserved for the consideration of the Full Court should be answered in the manner proposed in the joint reasons. 179 The Charter of the United Nations, Art 73 and the common first articles to ICCPR and The International Covenant on Economic, Social and Cultural Rights (concerning self-determination of peoples) were mentioned. Callinan CALLINAN J. The question in this case is whether Commonwealth laws, requiring Australian citizenship to vote for, and to be a member of, the Legislative Assembly of Norfolk Island, are a valid exercise of the territories power conferred by s 122 of the Constitution180. The facts The plaintiffs and the defendant are agreed as to the relevant facts. Norfolk Island was discovered and claimed as a British possession on 10 October 1774. It was included within the territory of New South Wales, as defined by the Commission issued to Governor Phillip on 12 October 1786, to be administered by him. It was occupied, primarily as a penal settlement, first from 1788 to 1814 and later from 1825 to 1856. On 24 October 1843, by Letters Patent181, the Queen appointed that from and after 29 September 1844 Norfolk Island was to be severed from the government of New South Wales and annexed to the government and Colony of Pitcairn Island is remote both geographically and socially from the rest of the world. It was occupied in 1790 by a group of mutineers from HMAV Bounty and some Polynesian men and women182. As fugitives, the former had deliberately chosen the island for its remoteness183. It was not an ideally hospitable place for permanent settlement. In consequence, on 8 June 1856, the inhabitants of Pitcairn Island, wholly or mainly the descendants of the original settlers, chose to travel to Norfolk Island on the Morayshire, a vessel provided 180 Section 122 provides: "The Parliament may make laws for the government of any territory surrendered by any State to and accepted by the Commonwealth, or of any territory placed by the Queen under the authority of and accepted by the Commonwealth, or otherwise acquired by the Commonwealth, and may allow the representation of such territory in either House of the Parliament to the extent and on the terms which it thinks fit." 181 These were lawful following the enactment, during the previous year, of An Act to amend so much of an Act of the last Session, for the Government of New South Wales and Van Diemen's Land, as relates to Norfolk Island 1843 (Imp) (6 & 7 Vict 182 See Christian v The Queen [2006] UKPC 47 at [2] per Lord Hoffmann. 183 Christian v The Queen [2006] UKPC 47 at [59] per Lord Hope of Craighead. Callinan for them by the Imperial authorities, and to settle on the island. It is of no significance to this case that later some returned to resettle on Pitcairn Island. On 24 June 1856, by Order in Council184 ("the 1856 Order"), Norfolk Island was severed from the government and Colony of Van Diemen's Land and made a "distinct and separate settlement". The Order in Council provided: " … [Norfolk Island] shall be a distinct and separate settlement; the affairs of which, until further Order is made in that behalf by Her Majesty, be administered by a Governor to be for that purpose appointed by Her Majesty, with the advice and consent of Her Privy Council." The 1856 Order appointed the Governor of New South Wales the Governor of Norfolk Island for the time being. The Royal Instructions that were issued to him included these recitals and directions: "And whereas the inhabitants of the said island are chiefly emigrants from Pitcairn's Island in the Pacific Ocean, who have been established in Norfolk Island under our authority, and who have been accustomed in the territory from which they have removed to govern themselves by laws and usages adapted to their own state of society, you are, as far as practicable, and as far as may be consistent with the regulation next preceding, to preserve such laws and usages, and to adapt the authority vested in you by the said recited Order in Council to their preservation and maintenance. And whereas you are further authorized by the said recited Order in Council to make grants of Waste Lands in the said island in our name and in our behalf, subject nevertheless to such Rules and Regulations as aforesaid: Now we do hereby further enjoin you to exercise the authority so vested in you, as far as you may find it practicable in conformity with such laws and usages as aforesaid which you may find established among the inhabitants in question, in relation to the possession, use, and enjoyment of land. On 14 October 1857, pursuant to the Royal Instructions, the Governor of New South Wales, Sir William Denison, compiled, declared and enacted the "Laws and Regulations for Norfolk Island", referred to as "the thirty-nine laws". These were based largely, but not entirely, upon the laws by which the Pitcairners had been accustomed to govern themselves on Pitcairn Island. They were described by Lord Hoffmann in Christian v The Queen185 as "rudimentary". 184 This was lawful following the enactment the previous year of the Australian Waste Lands Act 1855 (Imp). 185 [2006] UKPC 47 at [2]. Callinan It is not surprising therefore that it was contemplated that they might need to be, and were, adapted as appropriate. On 14 November 1896, the Governor of New South Wales, Sir Henry Brand, proclaimed that all laws and regulations in force within Norfolk Island were repealed and annulled. An Order in Council dated 15 January 1897 ("the 1897 Order") revoked the 1856 Order and ordered that the affairs of Norfolk Island should thenceforth and until further Order be made in that behalf by Her Majesty, be administered by the Governor and Commander-in-Chief for the time being of the Colony of New South Wales and its Dependencies. It expressly ordered, among other things, that all "laws, ordinances, and regulations in force in Norfolk Island ... shall continue in force until repealed or altered by competent authority". On 11 August 1897 a collection of documents was presented to the Parliament of New South Wales. It consisted of correspondence between Imperial and Colonial officials concerning the transfer of authority over the Island that was effected by the 1897 Order. The collection was presented to the Imperial Parliament in February 1897. By an Order in Council dated 18 October 1900 ("the 1900 Order"), the Queen revoked the 1897 Order and ordered that the affairs of Norfolk Island should thenceforth, and until further Order made in that behalf by Her Majesty, be administered by the Governor for the time being of the State of New South Wales and its Dependencies. The 1900 Order provided, among other things, that all "Laws, Ordinances, and Regulations in force in Norfolk Island ... shall continue in force until repealed or altered by competent authority" (emphasis added). Even by 1900 the community was a small and isolated one. It had, as appears from what I have so far summarized, had a long association with the colonies of Australia. It had never been identified internationally as a nation or polity, let alone a wholly self-governing one. It had a particular utility and relevance to Australia by reason of a proposal for the junction of an undersea Pacific cable to Australia. The material before the Court also shows that New South Wales from time to time had provided considerable financial sustenance to the community. Obviously there were doubts about the capacity of the community to be self-sustaining. None of this is to say that the islanders themselves would have wished to forgo any rights that they may have possessed to control their own affairs in so far as that was possible. The history and realities which I have summarized, however, made this entirely impractical, and, without further Imperial intervention, legally impossible. After federation therefore, consideration, not surprisingly, came to be given by the new Australian polity to the annexation of Norfolk Island to the Callinan Commonwealth. the Attorney-General's Department, Mr Garran, prepared an advice to deal with the future legal status of the island186: The Secretary of "The possible modes of annexing Norfolk Island the Commonwealth appear to be: to make it a territory placed by the Queen under the control of and accepted by the Commonwealth – or otherwise acquired by the Commonwealth (Constitution, section 122); to place it within the limits of a State of the Commonwealth (Constitution, section 123); to admit it as a new State of the Commonwealth subject to such terms and conditions as Parliament imposes (Constitution, section 121). The Island could apparently be made a territory under the control of the Commonwealth by the joint operation of an Imperial Order in Council and a Commonwealth Act. The effect of this would be that the Parliament could make laws for its government, and that it would be a dependency of the Commonwealth, not a part of the Commonwealth itself, and the general laws of the Commonwealth would not be in force in the Island to any further extent than the Parliament thought fit to provide – nor would it necessarily be within the Commonwealth tariff fence. In other words, it would be in the same relation to the Commonwealth as British New Guinea will be if the Papua Bill[187] is passed. The Island could be placed within the limits of a State by the procedure provided by section 123 of the Constitution – in conjunction with an Imperial Order in Council – and the effect would be that it would become part of the State and of the Commonwealth." On 30 March 1914, by Order in Council ("the 1914 Order"), the King, after reciting that the Commonwealth Parliament had passed an Act188 providing for the acceptance of Norfolk Island, ordered that Norfolk Island be placed under 186 Attorney-General's Department, Opinions of Attorneys-General of the Commonwealth of Australia with opinions of Solicitors-General and the Attorney- General's Department, vol 1 (1981) at 268. 187 Enacted as the Papua Act 1905 (Cth). 188 An Act to provide for the acceptance of Norfolk Island as a territory under the authority of the Commonwealth, and for the government thereof 1913 (Cth). Callinan the authority of the Commonwealth, and revoked the 1900 Order. On 1 July 1914 the Norfolk Island Act 1913 (Cth) (enacted in anticipation of the 1914 Order) commenced, by which Norfolk Island was declared to be accepted by the Commonwealth as a territory under its authority. A census of Norfolk Island was conducted in 2001189. It revealed that the island had a permanent population of 1574 people, and an ordinarily resident population of 2037 people. Of the former, 82.5 per cent were Australian citizens, 14.1 per cent were New Zealand citizens, and 1.4 per cent were citizens of the United Kingdom. The remainder were not designated as citizens of any particular country. Of the permanent population, 36.7 per cent were born on Norfolk Island, 33.4 per cent were born in Australia, 20.7 per cent were born in New Zealand, and 3.8 per cent were born in the United Kingdom. Of the ordinarily resident population, 77.4 per cent were Australian citizens, 18.8 per cent were New Zealand citizens, and 1.7 per cent were citizens of the United Kingdom. And, of the ordinarily resident population, 28.6 per cent were born on Norfolk Island, 38.1 per cent were born in Australia, 23.6 per cent were born in New Zealand, and 4.1 per cent were born in the United Kingdom. The challenged legislation The current Commonwealth Act which provides for Norfolk Island is the Norfolk Island Act 1979 (Cth) ("the Act"). In 2004, the Commonwealth enacted the Norfolk Island Amendment Act 2004 (Cth) ("the Amending Act"), Sched 1 cl 1 of which creates a new s 38(ba) of the Act, requiring Australian citizenship as a qualification for election as a member of the Norfolk Island Legislative Assembly. Section 38 provides: "Qualifications for election Subject to section 39, a person is qualified to be a candidate for election as a member of the Legislative Assembly if, at the date of nomination: he or she has attained the age of 18 years; and (ba) he or she is an Australian citizen; and he or she is entitled, or qualified to become entitled, to vote at elections of members of the Legislative Assembly; and he or she has such qualifications relating to residence as are prescribed by enactment for the purposes of this paragraph or, if no 189 Norfolk Island, Census of Population and Housing: Statistical Report on Characteristics of Population and Dwellings, (2001). Callinan such enactment is in force, he or she has been ordinarily resident within the Territory for a period of 5 years immediately preceding the date of nomination." Section 39 of the Act, to which s 38 is expressed as being subject, and which has been amended by Sched 1 cl 3 of the Amending Act, includes a new sub-s (2)(da), which is as follows: "Disqualifications for membership of Legislative Assembly (2) A member of the Legislative Assembly vacates his or her office if: (da) he or she ceases to be an Australian citizen". Section 39(2)(da) applies, however, only to a person who is elected as a Member of the Legislative Assembly on or after the commencement of the Amending Act: Sched 1 cl 4. The Amending Act also, by Sched 1 cl 5, inserts a new Div 1A (Qualifications of Electors) into Pt V of the Act. Under the new Div 1A in Pt V, in order to be enrolled as a voter on the Island a person must be an Australian citizen190. Further, a voter's name must be removed from the electoral roll if he or she ceases to be an Australian citizen191. The objects of the Amending Act were summarized in its Explanatory Memorandum in this way192: "The Norfolk Island Amendment Bill 2003 will amend the Norfolk Island Act 1979 to align electoral arrangements in Norfolk Island more closely with other Australian Parliaments (including those of the other self-governing Territories). In summary, it will: extend the right to vote in Legislative Assembly elections to all Australian citizens 'ordinarily resident' on Norfolk Island; 190 Section 39A(1) and (2) of the Act. 191 Section 39C(1) of the Act. 192 Australia, Senate, Norfolk Island Amendment Bill 2003, Explanatory Memorandum at 2. Callinan introduce an 'ordinarily resident' qualifying period of 6 months for enrolment on the electoral roll; establish Australian citizenship as a qualification for enrolment and for election to the Legislative Assembly; ensure consistency in the calculation of the 'residency period' and, in particular, preserve the existing enrolment rights of persons under the age of 25 who are absent from the Island for education- related purposes; and preserve the existing enrolment rights of those non-Australian citizens on the electoral roll." The question for this Court The specific question for the Court is whether s 3 of the Amending Act is a valid enactment of the Commonwealth Parliament, in so far as it gives effect to: cll 1, 3193 and 4 in Pt 1 of Sched 1 to the Amending Act; and cl 5 in Pt 1 of Sched 1 to the Amending Act, to the extent that cl 5 inserts into the Act ss 39A(1)(b), 39A(2)(a), 39C and the definition of "Returning Officer" in s 39D. The territories power Section 122 of the Constitution confers power on the Commonwealth Parliament to make laws "for the government" of three different kinds of territory: territory surrendered by a State and accepted by the Commonwealth; territory placed by the Queen under the authority of and accepted by the Commonwealth; and, territory otherwise acquired by the Commonwealth194. Norfolk Island is a territory of the second kind. 193 Clause 3 is as follows: "After paragraph 39(2)(d) he or she ceases to be an Australian citizen". 194 cf the discussion of different types of colonies, settled, conquered or ceded in the speech of Lord Hope of Craighead in Christian v The Queen [2006] UKPC 47 at Callinan At this point it is relevant to recall that the island was uninhabited at the time of its discovery by Captain Cook. Thereafter, until its acceptance by Australia, everyone who came to reside there, whether involuntarily as convicts, voluntarily as free people, or as Pitcairners seeking an apparently more attractive and comfortable habitat, did so only with the assistance or support of the Imperial authorities or a colony of Australia, or both. The significance of this is that questions which might perhaps have arisen with respect to any concession by the Imperial authorities of self-government, rights exercisable by Royal Prerogative, or rights generally of continuing or perpetual self-government, do not arise195. The plaintiffs' submissions The real question is whether any conditions or limitations should be regarded as attaching to the authority of the Commonwealth over the territory of Norfolk Island. The plaintiffs submit that it is not open to the Commonwealth Parliament to prescribe that legislators in the Territory be confined to a particular subset of people in the Territory, and that the capacity to choose and to be chosen as a legislator be limited to members of that subset. Alternatively, they submit that the acceptance of authority by Australia under s 122 of the Constitution in respect of Norfolk Island as an external territory necessarily involves the establishment of relations between Australia and the community or inhabitants of that Territory. In support of the alternative submission the plaintiffs refer to the joint judgment in Re Minister for Immigration and Multicultural and Indigenous "The acquisition of an external Territory by Australia, as contemplated by s 122, involves the establishment of relations between Australia and the inhabitants of that Territory. There is no single form of relationship that is necessary or appropriate. The kinds of relationship that may be regarded by Parliament as appropriate are as various as the kinds of Territory that may be acquired, and the forms of acquisition that may be adopted. Just as acquisition of a Territory ordinarily involves the creation of relationships, the relinquishment of a Territory involves the alteration or termination of relationships. The steps that may be taken for the purpose of such alteration or termination are also various." 195 See the discussion by Eggleston J in Newbery v The Queen (1965) 7 FLR 34 at 39- 40, and the cases referred to by his Honour. 196 (2005) 222 CLR 439 at 457 [29] per Gleeson CJ, McHugh, Gummow, Hayne, Callinan The balance of the plaintiffs' submissions are heavily, if not to say exclusively, based upon the premise of the alternative submission. In summary they are these. The nature of the relationship between an external territory and Australia is not fixed. The circumstances in which authority over a territory was accepted, including the status and characteristics of the territory at that time, are relevant. The relations that may exist between Australia and the inhabitants of an external territory are not necessarily identical with those that apply to the people of the Commonwealth197. On acceptance by Australia, Norfolk Island was a Crown possession or dependency which had been established as a distinct and separate settlement for occupation by Pitcairners and their descendants, and others admitted to their community. Norfolk Island did not on its acceptance by Australia, nor has it since, become part of Australia, geographically or politically. Statements to the contrary in Berwick Ltd v Gray198 are wrong. Its community is not, and has never been, part of the Australian community. Australian citizenship has never been a determining factor in identifying the community of the Island. A law which requires Australian citizenship for voting and election in Norfolk Island is not a law "for the government" of Norfolk Island because it selects a relevant criterion which is not a defining characteristic a person must possess for membership of the community of Norfolk Island, or of "the people" of Norfolk Island. Such a law is inconsistent with the status of the island as a distinct and separate settlement, and with the basis upon which the community was established and has continued in existence. In consequence, the challenged provisions would disenfranchise many of the people of Norfolk Island. The people of Norfolk Island have never been part of "the community constituting the Australian body politic"199. Even if a correct characterization of the people of Norfolk Island who are not Australian citizens be as "aliens", they, as a substantial proportion of the people of Norfolk Island, should not be stripped of electoral rights. Their entitlement to vote flows from the fact that they are part of "the people of [a] Territory" to whom substantial self-government has been granted, and who, in accordance with ordinary and basic notions of responsible government embodied in the Constitution, should be entitled to vote. Disposition of the case There are several reasons why the plaintiffs' submissions should be rejected. 197 eg in covering cll 3 and 5 of the Constitution and s 24. 198 (1976) 133 CLR 603. 199 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 189 Callinan Whilst it is true that by the 1856 Order (the force of which is not questioned) it was ordered that the Island be made a "distinct and separate settlement", a reservation of the possibility of change by further order was expressly made in it. Accordingly, the Pitcairners who had then only so recently arrived on Norfolk Island should not have had expectations, let alone rights, of any form of permanent self-governing status. That, as subsequent history until federation shows, the Governors of New South Wales, exercising delegated Imperial authority, although not absolutely bound to do so, were generally content to adopt a great deal of the customary law of the Pitcairners as they and visiting admiralty officers200 had formulated it on Pitcairn Island, and as contemplated by the 1856 Order, does not mean that the inhabitants or residents became entitled to a permanent right of self-government. It does not matter for present purposes how the Island or the community of the Island was to be regarded in 1900, whether as a settlement, a colony, a territory, a province, a provincial territory of a colony, a colonial territory, or otherwise; hard and fast definitions of claimed lands and seas and clear international rules of law applicable to them, in those times of competing Imperial expansion, were evolving. The community on the island was, on any view, then a community of people who owed their presence there to the monarch, and had no legal right to self-government, except to the extent, if any, that the monarch or the monarch's delegate, not irrevocably, may have conferred it. The last Order in Council before federation was entirely consistent with the earlier ones in not conferring it, but by making provision for the continuation in force of the current law, subject to repeal or alteration by "competent authority". Repeal and alteration by competent authority or authorities was exactly what did in fact occur. The first relevant occurrence was legislation of a higher order than Letters Patent or Order in Council, that is, enactment, by the Imperial Parliament, of s 122 of the Commonwealth of Australia Constitution Act in 1900. That section in terms confers on the Parliament the power to make laws for the government of territories, including those placed by the monarch under the authority of, and accepted by, the Commonwealth. Events to produce such a result, of placement and acceptance of Norfolk Island by Australia, ensued some 13 or so years later by way of an Imperial Order in Council in 1914, following the Act of the Commonwealth Parliament of 1913 which anticipated that Order. It is impossible, in my view, to regard the challenged provisions, concerned as their representatives, as other than laws for the government of Norfolk Island. The plaintiffs' proposition is, effectively, that every law must accept or adopt the the qualifications of electors and they were with 200 See Christian v The Queen [2006] UKPC 47 at [2] per Lord Hoffmann. Callinan franchise for which the legislature of the island, itself elected according to that franchise, has made provision. The truth is that territories subject, or becoming subject, to the Australian Constitution have never possessed the same assured rights as the people of the States, and the States themselves, have. This follows, not only from the history which I have summarized, but also from the implication to which ss 107 and 108 of the Constitution give rise201. The Constitution, whilst making provision for the continuation of every power of a Colony becoming a State and (subject to the exercise of valid federal power) of Colonial laws, and the acceptance of a territory by the Commonwealth, is silent, intentionally so, it may be inferred, as to the continuation of the powers and laws of a territory. The special and quite different status of the new States, and their differentiation from the territories is explained by Kitto J in Spratt v Hermes202 in passages203 which I will quote when I discuss the relevant cases. Cases considering s 122 It is to those cases that I now turn. There is no decision of the Court which supports the plaintiffs' submissions. Indeed the contrary is generally the position. Repeatedly the cases emphasize the amplitude of the territories power, even though other provisions of the Constitution have at times been held to apply to the territories. 201 Sections 107 and 108 provide: "107 Every power of the Parliament of a Colony which has become or becomes a State, shall, unless it is by this Constitution exclusively vested in the Parliament of the Commonwealth or withdrawn from the Parliament of the State, continue as at the establishment of the Commonwealth, or as at the admission or establishment of the State, as the case may be. Every law in force in a Colony which has become or becomes a State, and relating to any matter within the powers of the Parliament of the Commonwealth, shall, subject to this Constitution, continue in force in the State; and, until provision is made in that behalf by the Parliament of the Commonwealth, the Parliament of the State shall have such powers of alteration and of repeal in respect of any such law as the Parliament of the Colony had until the Colony became a State." 202 (1965) 114 CLR 226 at 250-251. 203 At [191] below. Callinan In Buchanan v The Commonwealth204, R v Bernasconi205 and Porter v The King; Ex parte Yee206, the Court was asked to read s 122 of the Constitution as subject to ss 55, 80 and 71 of the Constitution respectively, but in each case refused to do so. In Jolley v Mainka207, the Court considered the Commonwealth's power over the Territory of New Guinea, which was governed by Australia pursuant to a mandate of the League of Nations. Starke J was of the view that New Guinea was territory "otherwise acquired [that is, not, as here, 'accepted'] by the Commonwealth"208. His Honour said that the Commonwealth had acquired "plenary control of the territory, subject to and during the subsistence of the mandate"209. Dixon J210, with whom Rich J agreed211, said however that the King's acceptance of the mandate on behalf of the Commonwealth made it territory "placed by the [King] under the authority of and accepted by the Commonwealth" in accordance with s 122 of the Constitution. Evatt J held212 that s 122 of the Constitution had not been engaged: instead, the external affairs the power, conferred by s 51(xxix) of Commonwealth to govern the Territory. Starke J was the only Justice therefore to express an opinion about the possibility of any limitations upon s 122 when engaged. the Constitution, empowered In Ffrost v Stevenson213, a case concerning extradition from New South Wales to the Territory of New Guinea, Latham CJ said that s 122, not s 51(xxix), was the source of the authority to make laws for the Territory214. To hold 204 (1913) 16 CLR 315. 205 (1915) 19 CLR 629. 206 (1926) 37 CLR 432. 207 (1933) 49 CLR 242. 208 (1933) 49 CLR 242 at 250. 209 (1933) 49 CLR 242 at 250. 210 (1933) 49 CLR 242 at 256. 211 (1933) 49 CLR 242 at 247. 212 (1933) 49 CLR 242 at 278-279, 289. 213 (1937) 58 CLR 528. 214 (1937) 58 CLR 528 at 556. Callinan otherwise would, in the opinion of his Honour, undermine the plenary nature of "If the legislative power of the Commonwealth with respect to the territories were held to depend upon the provisions of sec 51(xxix) it would follow that sec 55 would be applicable to laws passed under that power – contrary to Buchanan's Case216 – that trial upon indictment of any offence must be by jury – contrary to Bernasconi's Case217 – and that the judges of courts in the territories must have a life tenure – contrary to Dixon J made similar observations to Latham CJ, and added this219: "[I]t may possibly be said that sec 122 implies that none of the other powers conferred on the parliament by the Constitution is to be taken to authorize the Commonwealth; in other words, that it alone is the source of power to govern territories." the government or control of territories outside Neither of those Justices in Ffrost v Stevenson admitted of any limits on the exercise of power over the mandated territory. In Lamshed v Lake220, a majority of the Court (Dixon CJ, Webb, Kitto and Taylor JJ, McTiernan and Williams JJ dissenting) held that laws sufficiently connected to a territory were valid under s 122 of the Constitution wherever territorially the Commonwealth had legislative competence. Dixon CJ221 (with whom Webb J agreed222) emphasized that each territory is a territory of Australia, not a "quasi foreign country", and that the Commonwealth may legislate for the 215 (1937) 58 CLR 528 at 556. 216 Buchanan v The Commonwealth (1913) 16 CLR 315. 217 R v Bernasconi (1915) 19 CLR 629. 218 Porter v The King; Ex parte Yee (1926) 37 CLR 432. 219 (1937) 58 CLR 528 at 566. 220 (1958) 99 CLR 132. 221 (1958) 99 CLR 132 at 144. 222 (1958) 99 CLR 132 at 152. Callinan government of territories "as part of its legislative power operating throughout its jurisdiction". His Honour then went on223: "The contrary view seems to lead to many absurdities and incongruities. Take for example the legislative power over trade and commerce with other countries and among the States. Under that power it could hardly be doubted that the Commonwealth Parliament could provide in effect upon what conditions this or that commodity might be shipped to New Zealand or to Tasmania without other restraint. Any law of South Australia at variance with the enactment would be void; see O'Sullivan v Noarlunga Meat Ltd224. Is it to be supposed that a law to the same effect with respect to a federal territory is outside the competence of the federal Parliament?" Kitto J reasoned similarly to Dixon CJ. His Honour said of s 122225: "[T]he section cannot fairly be read as meaning that the national Parliament, when it turns to deal with a territory which has come under the nation's authority, shall shed its major character and take on the lesser role of a local legislature for the territory, concerned only to regulate the local law. Surely it means that a territory which has been accepted by the Australian Federation may be fitted into the Australian scene, so far as laws are concerned, by the legislative activity of the Australian Parliament: that the entire legal situation of the territory, both internally and in relation to all parts of the Commonwealth, may be determined by or by the authority of Parliament." (emphasis added) The dissentients in Lamshed v Lake published brief reasons for judgment. McTiernan J was of the view that a law passed under s 122 restraining the States' powers over trade and commerce "would clearly violate the federal nature of the Constitution and being contrary to it would be invalid"226. Williams J said that legislation passed under s 122 could not have extra-territorial operation so as to bind a State227, and that s 51(i) was insufficient to fill any "hiatus" because a territory is not another country, nor a State228. 223 (1958) 99 CLR 132 at 144. 224 (1954) 92 CLR 565; on appeal (1956) 95 CLR 177, [1957] AC 1. 225 (1958) 99 CLR 132 at 154. 226 (1958) 99 CLR 132 at 150. 227 (1958) 99 CLR 132 at 150. 228 (1958) 99 CLR 132 at 152. Callinan By the time Fishwick v Cleland229 was heard, Australia, pursuant to a Trusteeship Agreement between it and the recently created United Nations, held a mandate for the government of the Territory of Papua and New Guinea. There, the Court was asked whether the exercise of Commonwealth legislative power, pursuant either to the external affairs power in s 51(xxix) or the territories power in s 122 of the Constitution, was required to be consistent with the terms of the Trusteeship Agreement and the Articles of the Charter of the United Nations. On the reasoning of Starke J in Jolley v Mainka, s 122 would arguably be limited by the terms of the Agreement230. In Fishwick v Cleland the Court (Dixon CJ, McTiernan, Fullagar, Kitto, Menzies and Windeyer JJ) concluded that there was there were no the Commonwealth's power because limitation on inconsistencies between relevant Commonwealth enactment231. That would have been sufficient to resolve the case, but the Court went on to say that "if any such inconsistency could be found we should not think that it went to the legislative validity of the enactment considered as a matter of municipal law"232. The Court continued233: the Trusteeship Agreement and the "Australia possesses a federal form of government and that of course involves a distribution of legislative powers between States and Commonwealth. A difficulty has been felt in saying under which of the enumerated powers of the Commonwealth Parliament fell the authority to legislate for the government of a mandated territory and of course whatever difficulty has been felt as to a mandate will be felt as to a trust territory. But that is a matter of the constitutional law of Australia, a municipal or domestic matter, and is not, we think, determined by reference to the provisions of the Trusteeship Agreement or of the Charter of the United Nations. It was suggested by the Attorney-General that the 'status' of the Territory of New Guinea was not for the judicial power to determine but rather to be ascertained for judicial purposes by inquiry from the Executive Government. We need not pursue the suggestion for we think that it is clear upon the documents and information before us that the Territory is subject to the legislative power of the Commonwealth Parliament. It is the very object of the trusteeship system to place a trust territory under the governmental authority of the State which undertakes to administer the territory in accordance with a Trusteeship Agreement. In 229 (1960) 106 CLR 186. 230 See (1933) 49 CLR 242 at 250. 231 (1960) 106 CLR 186 at 194-196. 232 (1960) 106 CLR 186 at 196. 233 (1960) 106 CLR 186 at 196-197. Callinan the case of a State possessing a unitary system of government that means that the full powers of government are at its service in performance of its obligations under the Trusteeship Agreement. In the case of a federal system the powers which may be exercised must of course depend upon the constitution of the State but that is entirely an internal matter." In Spratt v Hermes234, Barwick CJ was wary of the Constitution as if Ch III were "inapplicable to territories", but concluded that "[t]he Commonwealth may create territorial courts without complying with the requirements of s 72"235. Kitto J said in that case236: interpreting "[T]he first five Chapters of the Constitution belong to a special universe of discourse, namely that of the creation and the working of a federation of States, with all the safeguards, inducements, checks and balances that had to be negotiated and carefully expressed in order to secure the assent of the peoples of the several Colonies, with their divers interests, sentiments, prejudices, ambitions and apprehensions, to unite in the federation. When Chap VI is reached, and it is found that s 122 gives the Parliament a general power to make laws for the government of any territory surrendered by any State to and accepted by the Commonwealth, or of any territory placed under the authority of the Commonwealth or otherwise acquired by it, a change to a fundamentally different topic is perceived. The change is from provisions for the self-government of the new federal polity to a provision for the government by that polity of any community which comes under its authority while not being 'a part of the Commonwealth'." Kitto J went on to say237: "[N]o provision of [Ch III] is to be interpreted as intending to reduce the generality of the power conferred by s 122 to make laws for inter alia the exercise of that judicial power which attaches to the Commonwealth, not in virtue of its character as the central polity of the federation and therefore in respect of the federated area, but in virtue of its responsibility for the entire (non-federal) government of a community made subject in all respects to its authority." 234 (1965) 114 CLR 226. 235 (1965) 114 CLR 226 at 248. 236 (1965) 114 CLR 226 at 250. 237 (1965) 114 CLR 226 at 251. Callinan Menzies J considered a submission that s 122 applied only to territories outside "the Federal System", and rejected it238. Teori Tau v The Commonwealth239 was concerned with the acquisition of property within a territory and required the Court to decide whether such acquisition must be on just terms. The Court (Barwick CJ, McTiernan, Kitto, Menzies, Windeyer, Owen and Walsh JJ) held that s 122 was not to be read as subject even to s 51(xxxi), one of the few express and guaranteed rights in the Constitution240: "Section 51 is concerned with what may be called federal legislative powers as part of the distribution of legislative power between the Commonwealth and the constituent States. Section 122 is concerned with the legislative power for the government of Commonwealth territories in respect of which there is no such division of legislative power. The grant of legislative power by s 122 is plenary in quality and unlimited and unqualified in point of subject matter. In particular, it is not limited or qualified by s 51(xxxi) or, for that matter, by any other paragraph of that section. While the Constitution must be read as a whole and as a consequence, s 122 be subject to other appropriate provisions of it as, for example, s 116, we have no doubt whatever that the power to make laws providing for the acquisition of property in the territory of the Commonwealth is not limited to the making of laws which provide just terms of acquisition." In this case it is unnecessary for me to form or state any view about the breadth of the proposition which I have just set out. For present purposes it is sufficient to note that this is another instance of the extensive operation accorded by the Court to s 122. Teori Tau v The Commonwealth was considered in Newcrest Mining (WA) Ltd v The Commonwealth241, which was concerned with mining leases over land in the Northern Territory. Commonwealth legislation purported to operate on the land contained within those leases. A majority of the Court (Toohey, Gaudron, 238 (1965) 114 CLR 226 at 269-271. 239 (1969) 119 CLR 564. 240 (1969) 119 CLR 564 at 570. 241 (1997) 190 CLR 513. Callinan Gummow and Kirby JJ) held242 that s 51(xxxi) fettered the Commonwealth's legislative power generally, while three Justices of the majority (Gaudron, Gummow and Kirby JJ) would have overruled Teori Tau v The Commonwealth and found243 that s 51(xxxi) fettered s 122 as well. Toohey J, however, thought "it would be a serious step to overrule a decision which has stood for nearly thirty years and which reflects an approach which may have been relied on in earlier years"244. His Honour was therefore unwilling to overrule it. In Capital Duplicators Pty Ltd v Australian Capital Territory245, the Court was asked whether Australian Capital Territory laws imposing fees for wholesale and retail licences, which were related to the value of goods sold, were an imposition of an "excise" within the meaning of s 90 of the Constitution. A majority of the Court (Brennan, Deane, Toohey and Gaudron JJ, Mason CJ, Dawson and McHugh JJ dissenting) held that they were, and effectively therefore that s 122 was to be read as subject to s 90 which confers exclusive power over excise and certain other imposts upon the Commonwealth. Brennan, Deane and Toohey JJ said that one of the objectives of federation was "the creation of a free trade area embracing the geographical territory of the uniting Colonies, that is, the territory of the Colonies which became the Original States of the Commonwealth on its establishment on 1 January 1901"246. Their Honours pointed out247 that the Australian Capital Territory was surrendered to, and accepted by, the Commonwealth. They said248: "It would be surprising if the surrender of part of a State to the Commonwealth and its acceptance by the Commonwealth pursuant to s 111, whilst leaving the territory as part of the Commonwealth, removed it from the operation of the constitutional provisions designed to create and maintain the free trade area." 242 (1997) 190 CLR 513 at 560 per Toohey J, 561 per Gaudron J, 597-598 per Gummow J, 652 per Kirby J. 243 (1997) 190 CLR 513 at 561 per Gaudron J, 597-598, 600 per Gummow J, 652 per 244 (1997) 190 CLR 513 at 560. 245 (1992) 177 CLR 248. 246 (1992) 177 CLR 248 at 274. 247 (1992) 177 CLR 248 at 275. 248 (1992) 177 CLR 248 at 276. Callinan Their Honours then considered whether the Commonwealth could delegate its exclusive power with respect to excise, concluding that what had occurred there was not a delegation of authority, but a creation of a legislature with its own powers not subject to Commonwealth review. They did not doubt, however, that a relevant power existed249: "the [Commonwealth] Parliament must, if it wishes to override the [territory's] enactment, pass a new law to achieve that result". Gaudron J, the fourth Justice in the majority, was of the view that s 122 could not undermine the free-trade area created at federation250: "One constitutional consequence of the fact that the Internal Territories [ie the Northern and Australian Capital Territories] form part of the geographical area that is the Commonwealth of Australia is that s 122, as it relates to them, must yield to a constitutional provision which mandates a situation for the whole of the Commonwealth. Thus, for example, s 122 must yield to s 118 which requires that '[f]ull faith and credit ... be given, throughout the Commonwealth to the laws, the public Acts and records, and the judicial proceedings of every State.'" The opinion of the dissenting judges in Capital Duplicators is not inconsistent with the notion of an unqualifiedly plenary power under s 122 as it had been held in previous cases. Mason CJ, Dawson and McHugh JJ said this251: "[T]he imposition by a territory legislature, pursuant to a grant of legislative power by the Parliament, of duties of excise in the territory is not prohibited by s 90. That is because the territory legislature, in imposing such duties, would be exercising legislative power which is referable to, derived from and part of the power of the Parliament which is made exclusive by s 90." The last case to which reference should be made is the one particularly sought to be relied on by the plaintiffs, Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame252. It is true that there are statements in that case to the effect that the relations between the Commonwealth and persons in a territory are different from the relations between the Commonwealth and persons from a State253: 249 (1992) 177 CLR 248 at 283. 250 (1992) 177 CLR 248 at 288. 251 (1992) 177 CLR 248 at 263. 252 (2005) 222 CLR 439. 253 (2005) 222 CLR 439 at 457 [30] per Gleeson CJ, McHugh, Gummow, Hayne, Callinan "The relations that may exist between Australia and the inhabitants of external territories are not necessarily identical with those that apply to the people united in a federal Commonwealth pursuant to covering cl 3 of the Constitution, the people of the Commonwealth referred to in covering cl 5, or the people referred to in s 24. For example, the Constitution does not require that the inhabitants of an external Territory should have the right to vote at federal elections." It does not follow, however, that the territories power is in some way to be regarded as necessarily limited because of a difference between the history of a territory and its relations with Australia, and the history of the Colonies of Australia and their relations with the Imperial power and one another. The Commonwealth will inevitably generally enjoy much greater power with respect to territories than it does with respect to the States: as Kitto J observed in Spratt v Hermes254, the first five Chapters of the Constitution provide for a federation of States, with various "safeguards, inducements, checks and balances", whereas s 122, in Ch VI, provides, not for the self-government of the federal polity, but for government by that polity. As was also said in Ame255: "The references in the Constitution to 'the people of [particular States]' or 'the people of the Commonwealth' serve a significant purpose in their various contexts, but they do not have the effect of binding Australia to any particular form of relationship with all inhabitants of all external territories acquired by the Commonwealth, whatever the form and circumstances of such acquisition." Ame, in any event, is distinguishable from the present case in several respects. There was, both locally256 and on the part of Australia, a clear constitutional and legislative intent that the former Territory enjoy full independence: s 4 of the Papua New Guinea Independence Act 1975 (Cth) provided that Australia "ceases to have any sovereignty, sovereign rights or 254 (1965) 114 CLR 226 at 250-251. 255 (2005) 222 CLR 439 at 457 [30] per Gleeson CJ, McHugh, Gummow, Hayne, 256 See Ame (2005) 222 CLR 439 at 448 [9]-[10], 449-451 [13]-[14], where relevant provisions of the Papua New Guinea Constitution are considered. Callinan rights of administration in respect of or appertaining to the whole or any part of Papua New Guinea"257. There is no similar provision, or anything even approaching it, in the case of Norfolk Island. None of the cases can avail the plaintiffs. Conclusion and orders The questions reserved for the Full Court should be answered as follows: Is s 3 of the Norfolk Island Amendment 2004 (Cth), insofar as it gives effect to: cll 1, 3 and 4 in Pt 1 of Sched 1 to that Act; and cl 5 in Pt 1 of Sched 1 to that Act to the extent that that clause inserts into the Act the following new provisions: par 39A(1)(b); par 39A(2)(a); (iii) s 39C; and the definition of "Returning Officer" in s 39D, valid? Yes. 2. Who should pay the costs in respect of the special case? The plaintiffs. 257 (2005) 222 CLR 439 at 447 [8] per Gleeson CJ, McHugh, Gummow, Hayne,
HIGH COURT OF AUSTRALIA BHP GROUP LIMITED APPELLANT AND VINCE IMPIOMBATO & ANOR RESPONDENTS BHP Group Limited v Impiombato [2022] HCA 33 Date of Hearing: 9 August 2022 Date of Judgment: 12 October 2022 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation W A Harris QC with J E Moir for the appellant (instructed by Herbert Smith Freehills) J T Gleeson SC with A D Pound SC and E Levine for the respondents (instructed by Phi Finney McDonald and Maurice Blackburn Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS BHP Group Ltd v Impiombato Statutes – Interpretation – Territorial operation – Presumption against extraterritoriality – Acts Interpretation Act 1901 (Cth), s 21(1)(b) – Where Pt IVA of the Federal Court of Australia Act 1976 (Cth) permitted a person to commence a representative proceeding in the Federal Court of Australia on behalf of other persons ("group members") where certain statutory criteria were met – Where Pt IVA did not contain any express geographic or territorial restriction on the identity of persons who could be group members – Whether Pt IVA allowed claims to be brought on behalf of group members not resident in Australia. Words and phrases – "central focus", "claims", "class action", "federal jurisdiction", "hinge", "in and of the Commonwealth", "matter", "object of legislative concern", "personal jurisdiction", "presumption", "presumption against extraterritoriality", "representative proceedings", "statutory construction", "statutory interpretation", "statutory presumption", "subject matter jurisdiction", "territorial connection", "territorial jurisdiction", "territorial restriction". Constitution, s 77(i). Acts Interpretation Act 1901 (Cth), s 21(1)(b). Federal Court of Australia Act 1976 (Cth), Pt IVA; ss 19, 33A, 33C, 33D, 33ZB. KIEFEL CJ AND The question in this appeal is whether Pt IVA of the Federal Court of Australia Act 1976 (Cth) ("the Act") permits representative proceedings to be brought in the Federal Court of Australia on behalf of group members who are not resident in Australia. The question is entirely one of statutory construction. The question has arisen at an interlocutory stage of a representative proceeding brought by the respondents against the appellant, BHP Group Ltd ("BHP"). The proceeding is brought on behalf of group members identified as persons who purchased shares in BHP or in BHP Group Plc during a defined period and who are alleged to have suffered loss resulting from conduct of BHP in contravention of ss 674(2) and 1041H(1) of the Corporations Act 2001 (Cth) and s 12DA(1) of the Australian Securities and Investments Commission Act 2001 (Cth). The proceeding is within the original jurisdiction conferred on the Federal Court by s 1337B(1) of the Corporations Act and by s 39B(1A)(c) of the Judiciary Act 1903 (Cth). The primary judge (Moshinsky J)1 and, on appeal by leave, the Full Court of the Federal Court (Middleton, McKerracher and Lee JJ)2 rejected an argument by BHP that Pt IVA of the Act does not permit group members to include persons who are not resident in Australia. Having been granted special leave to appeal to this Court3, BHP repeats in the appeal its argument unanimously rejected in the Federal Court. For reasons which follow, the argument must again be rejected, and the appeal must fail. Part IVA of the Act Part IVA was inserted into the Act in 19924. The Part has now been in operation for more than 30 years. During that period, it and some of its more recent State counterparts have been considered by this Court on multiple occasions5. Impiombato v BHP Group Ltd [No 2] [2020] FCA 1720. 2 BHP Group Ltd v Impiombato (2021) 286 FCR 625. [2022] HCATrans 13. 4 Federal Court of Australia Amendment Act 1991 (Cth). 5 Wong v Silkfield Pty Ltd (1999) 199 CLR 255; Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1; Timbercorp Finance Pty Ltd (In liq) v Collins (2016) 259 CLR 212; BMW Australia Ltd v Brewster (2019) 269 CLR 574. There is no need to traverse the detail of the Part. Enough for present purposes is to recall some broad features of its operation. Part IVA, as was explained soon after its insertion, "assumes the investment by another law of the Parliament of [the Federal Court] with jurisdiction to entertain the subject matter of the representative proceeding" and "creates new procedures and gives the court new powers, in relation to the particular exercise of that jurisdiction"6. The distinction between the jurisdiction of the Federal Court, assumed by Pt IVA, and procedures and powers of the Federal Court relating to the particular exercise of that jurisdiction, created by Pt IVA, needs to be borne firmly in mind when considering BHP's argument about the construction of Pt IVA. The procedures which Pt IVA creates, and the powers which it gives to the Federal Court, do not stand alone. Part IVA is framed on the assumption that it will operate concurrently with the procedures and powers of the Federal Court which relate generally to the exercise of jurisdiction conferred on it. Important amongst the procedures assumed by Pt IVA are rules of practice and procedure7 which make provision for a proceeding to commence by an applicant filing an originating application8 and for the service of that originating application on a respondent9. Those rules of practice and procedure are in turn framed against the background of certain precepts of the common law. One of those precepts is that (enemy aliens apart) any person who has standing to assert a claim within the jurisdiction of a court has a right to commence a proceeding in the court by filing an initiating process, irrespective of that person's nationality or place of residence10. Another is that (voluntary submission apart) service of initiating process on a person against whom the claim is asserted is a necessary foundation 6 Poignand v NZI Securities Australia Ltd (1992) 37 FCR 363 at 365, cited in Wong v Silkfield Pty Ltd (1999) 199 CLR 255 at 258 [1]. Section 38 of the Act. Part 8 of the Federal Court Rules 2011 (Cth). Part 10 of the Federal Court Rules 2011 (Cth). 10 Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 252; Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1 at 52 [88]. for the exercise of jurisdiction by the court to determine that claim against that person11. Pivotal to the operation of Pt IVA is s 33C of the Act, which is headed "Commencement of proceeding". Section 33C(1) provides: "Subject to this Part, where: 7 or more persons have claims against the same person; and the claims of all those persons are in respect of, or arise out of, the same, similar or related circumstances; and the claims of all those persons give rise to a substantial common issue of law or fact; a proceeding may be commenced by one or more of those persons as representing some or all of them." In that provision, and throughout the Act, the word "person" includes a body politic or corporate as well as an individual12 and the word "persons" needs to be read correspondingly13. Section 33D complements the permissive concluding words of s 33C(1). By operation of s 33D, a "person" referred to in s 33C(1)(a) who has a sufficient interest to have standing to commence a proceeding on that person's own behalf against "another person" is taken to have a sufficient interest to commence a representative proceeding against "that other person" on behalf of "other persons" referred to in s 33C(1)(a). Section 33A sets out definitions which can only be understood having regard to ss 33C(1) and 33D. Section 33A defines "representative party" to mean "a person who commences a representative proceeding". Importantly to BHP's 11 Laurie v Carroll (1958) 98 CLR 310 at 323, referred to in Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 23 [11]. See also (2002) 211 CLR 1 at 36 [55]; Gosper v Sawyer (1985) 160 CLR 548 at 564-565; Flaherty v Girgis (1987) 162 CLR 574 at 599-600; John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 517 12 Section 2C of the Acts Interpretation Act 1901 (Cth). 13 Section 18A of the Acts Interpretation Act 1901 (Cth). argument, it defines "group member" to mean "a member of a group of persons on whose behalf a representative proceeding has been commenced". Section 33E specifies that (exceptional cases aside) a representative party need not have the consent of a group member in order to commence a representative proceeding on that group member's behalf. Section 33J confers on each group member a right to opt out of the representative proceeding by giving written notice within a time fixed by the Federal Court. Section 33X ordinarily requires notice to be given to group members both of the commencement of the proceeding and of their right to opt out. Section 33Y indicates that the notice need not be given to group members personally and might well be given by means of a press advertisement or a radio or television broadcast. There is accordingly a "real possibility"14 that a group member will be unaware of the proceeding and of their right to opt out. The reality of that possibility is specifically acknowledged in s 33Y(8), which provides that failure of a group member to receive or respond to a notice does not affect a step taken, an order made, or a judgment given, in a proceeding. Notwithstanding the possibility of a group member remaining unaware either of the proceeding or of their right to opt out, s 33Z empowers the Federal Court, in determining a matter in a representative proceeding, to give a judgment which, by force of s 33ZB, "binds" all group members which the judgment identifies as affected by it, other than group members who have exercised their right to opt out. To the extent that a judgment given by the Federal Court in a representative proceeding binds group members by force of s 33ZB, Pt IVA has been said to create "its own kind of statutory estoppel"15. Needless to say, the statutory estoppel is operative as, and only as, part of the domestic law of Australia. Whether, when, and for what purposes, a judgment given by the Federal Court in a representative proceeding might be taken to determine the existence, or preclude the exercise, of legal rights under the domestic law of another country is a matter to be determined under the domestic law of that country. That is a topic on which Pt IVA has nothing to say. 14 Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 31 [39]. 15 Timbercorp Finance Pty Ltd (In liq) v Collins (2016) 259 CLR 212 at 235 [52]. BHP's argument and the ultimate answer to it This Court said in Wong v Silkfield Pty Ltd16 that "[l]ike other provisions conferring jurisdiction upon or granting powers to a court, Pt IVA is not to be read by making implications or imposing limitations not found in the words used". BHP does not dispute that proposition. It does not seek to limit the scope of the references to "7 or more persons" or "the same person" in s 33C(1)(a), or to a "person", "another person" or "that other person" in s 33D. It does not seek to read down the reference to "a person" in the definition of "representative party" in s 33A. It does not deny that a representative proceeding can be commenced and maintained irrespective of the place of residence of the representative party and (subject to the ordinary rules as to service) irrespective of the place of residence of the respondent. BHP argues that the reference to "persons" in the definition of "group member" in s 33A, and presumably likewise the reference to "other persons" in s 33D, must nevertheless be read down to exclude persons who are not "resident" in Australia. Quite apart from the inherent imprecision of the concept of residence on which it hinges, BHP's argument encounters an immediate logical hurdle. The concluding words of s 33C(1) make clear that a representative party and group members are all to come from within the common pool of "7 or more persons" who have claims of the nature s 33C(1) describes. Those words equally make clear that any person from within the pool who becomes a group member could have chosen to be a representative party. If a person in the pool can become a representative party irrespective of their place of residence, as BHP accepts, why can a person in the pool become a group member only if resident in Australia? The reason why the reference to "persons" in the definition of "group member" in s 33A, and presumably to "other persons" in s 33D, must be construed to exclude persons who are not resident in Australia, according to BHP, arises primarily from the potential for a judgment of the Federal Court given in a representative proceeding to affect rights of unknowing and unconsenting group members by force of s 33ZB. BHP says that the existence of that potential means that a construction which excludes non-residents from group membership is necessary to give effect to a "presumption against extraterritorial operation". BHP says that presumption arises both at common law and by force of s 21(1)(b) of the Acts Interpretation Act 1901 (Cth). BHP's argument is about the construction of a Commonwealth statute. The argument must be addressed in the terms in which it is presented. (1999) 199 CLR 255 at 260-261 [11]. Yet it is impossible not to notice that BHP's argument bears a marked resemblance to an argument about the limits of State legislative power put by the plaintiff and rejected by this Court in Mobil Oil Australia Pty Ltd v Victoria17. The argument in that case was that the Victorian equivalent of Pt IVA was beyond the legislative power of the Victorian Parliament, insofar as it allowed a representative proceeding to be brought in the Supreme Court of Victoria on behalf of group members resident outside Victoria, for want of a sufficient territorial connection with Victoria. The answer was that a sufficient territorial connection was to be found in the circumstance that the legislation "concern[ed] the jurisdiction of the Supreme Court of Victoria"18. The ultimate answer to BHP's argument about construction is to the same effect as the answer to the argument about legislative power in Mobil Oil. To the extent that one or other of the common law and statutory presumptions on which BHP relies bears on the construction of Pt IVA, the presumption provides no reason for adopting a territorially restricted reading of the definition of "group member" in s 33A or "other persons" in s 33D. Enough to satisfy both presumptions is the circumstance that Pt IVA as a whole is concerned with the exercise of jurisdiction by the Federal Court. That is the bottom line. The common law and statutory presumptions on which BHP relies have concurrent and complementary operation. Despite an observed tendency19 for the two presumptions often to have been considered together and sometimes even to have been equated20, they are not wholly coincident. Each is best addressed separately. The common law presumption BHP seeks to label the common law presumption on which it relies a "presumption against extraterritorial operation"21. For reasons to be explained, the presumption of the common law of Australia is more accurately labelled a "presumption in favour of international comity". (2002) 211 CLR 1. (2002) 211 CLR 1 at 23 [10]. See also at 37 [59]. 19 See Pearce, Interpretation Acts in Australia (2018) at [4.48]. 20 Eg Vicars v Commissioner of Stamp Duties (NSW) (1945) 71 CLR 309 at 345. 21 cf Morrison v National Australia Bank Ltd (2010) 561 US 247 at 255. For its preferred formulation of the common law presumption, BHP points to the statement made by Isaacs J in Morgan v White22 that "the persons, property, and events in respect of which Parliament has legislated are presumed to be limited to those in the territory over which it has jurisdiction and for the welfare of which it exercises that jurisdiction". The precise formulation of that statement, and of a similar statement made by Barton J23, can be seen in the context of Morgan v White to have been influenced by nineteenth and early twentieth century notions of territorial restrictions on legislative power24. Those notions ceased to have any relevance to Commonwealth legislative power by the time of the commencement of the Statute of Westminster Adoption Act 1942 (Cth)25. Nevertheless, in Meyer Heine Pty Ltd v China Navigation Co Ltd26, Taylor J referred to the statement made by Isaacs J in Morgan v White as one of a number of expressions of the common law presumption appropriate to be applied to a Commonwealth statute penalising the entering into of a contract in restraint of trade. Windeyer J expressed the presumption in language similarly tailored to the statute in issue when he framed the question for decision in Meyer Heine as "whether the prima facie presumption, that the Act does not extend to penalize acts done outside Australia, by foreigners, has been displaced"27. The statement made by Isaacs J in Morgan v White was and remains an adequate reflection of the common law presumption in many statutory contexts. But as a generalisation it is too broad. (1912) 15 CLR 1 at 13. (1912) 15 CLR 1 at 4-5. 24 See the references in Morgan v White (1912) 15 CLR 1 at 4-5 and 13 to Macleod v Attorney-General for New South Wales [1891] AC 455. 25 R v Foster; Ex parte Eastern and Australian Steamship Co Ltd (1959) 103 CLR 256 (1966) 115 CLR 10 at 30-31. (1966) 115 CLR 10 at 43. Exposition of the common law presumption in play in Morgan v White and in Meyer Heine can be traced in Australia to Jumbunna Coal Mine, No Liability v Victorian Coal Miners' Association28. There O'Connor J said29: "Most Statutes, if their general words were to be taken literally in their widest sense, would apply to the whole world, but they are always read as being prima facie restricted in their operation within territorial limits. Under the same general presumption every Statute is to be so interpretated and applied as far as its language admits as not to be inconsistent with the comity of nations or with the established rules of international law: Maxwell on Statutes, 3rd ed, p 200." Plainly, O'Connor J did not see the implied restriction on the territorial operation of a statute to which he referred in the first sentence as freestanding but rather as a reflection of the "general presumption" which he expressed in the second sentence with reference to Maxwell on Statutes. There, the presumption appeared in the precise terms adopted by O'Connor J under the heading "Presumption against a Violation of International Law"30. In Barcelo v Electrolytic Zinc Co of Australasia Ltd31, Dixon J expressed the presumption in the same language drawn from Maxwell on Statutes as had been adopted by O'Connor J in Jumbunna. His Honour did so interchangeably with language drawn from nineteenth century English authority to the effect that "[i]t is always to be understood and implied that the legislature of a country is not intending to deal with persons or matters over which, according to the comity of nations, the jurisdiction properly belongs to some other sovereign or State"32. Dixon J returned to the presumption in Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society33. The "well settled rule of construction", his Honour there explained, is that "an enactment describing acts, matters or things in general words, so that, if restrained by no consideration lying (1908) 6 CLR 309. (1908) 6 CLR 309 at 363. 30 Kempe, Maxwell on the Interpretation of Statutes, 3rd ed (1896) at 200. (1932) 48 CLR 391 at 423-424, quoting Bloxam v Favre (1883) 8 PD 101 at 107, adopting Maxwell on Statutes. (1932) 48 CLR 391 at 424. To similar effect, see Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc (2003) 214 CLR 397 at 416 [45]. (1934) 50 CLR 581 at 601. outside its expressed meaning, its intended application would be universal, is to be read as confined to what, according to the rules of international law administered or recognized in our Courts, it is within the province of our law to affect or control". In R v Foster; Ex parte Eastern and Australian Steamship Co Ltd34, Dixon CJ expressed the presumption yet again. He did so, more pithily, in terms which he said were appropriate to be applied to a Commonwealth statute after the Statute of Westminster Adoption Act. He described it as "a presumption which assumes that the legislature is expressing itself only with respect to things which internationally considered are subject to its own sovereign powers". Understood in the more complete terms consistently so explained in Barcelo, Wanganui-Rangitikei and R v Foster, the common law presumption on which BHP relies provides no basis for reading down the general references to "group member" in s 33A or "other persons" in s 33D. For s 33ZB to bind a non- consenting group member who is not resident in Australia to a judgment of the Federal Court determining a matter in which the Federal Court has jurisdiction in a representative proceeding would be to infringe no principle of international law or international comity. BHP does not argue to the contrary. The statutory presumption Section 21(1)(b) of the Acts Interpretation Act provides that, in any Commonwealth Act, "references to localities jurisdictions and other matters and things shall be construed as references to such localities jurisdictions and other matters and things in and of the Commonwealth". That language has remained unaltered since the enactment of the Acts Interpretation Act in 1901. As a marginal note to the section then indicated, it was modelled on s 17 of the Interpretation Act 1897 (NSW). The origins of that section have been traced to s 8 of the Acts Shortening Act 1852 (NSW)35. Provisions in corresponding terms have been replicated in interpretation legislation in each Territory and most States36. (1959) 103 CLR 256 at 275. See also at 306-307. See also Lipohar v The Queen (1999) 200 CLR 485 at 497 [15]. 35 See DRJ v Commissioner of Victims Rights [No 2] (2020) 103 NSWLR 692 at 716- 36 Section 122(1)(b) of the Legislation Act 2001 (ACT); s 12(1)(b) of the Interpretation Act 1987 (NSW); s 38(1)(b) of the Interpretation Act 1978 (NT); s 35(1)(b) of the Acts Interpretation Act 1954 (Qld); s 27(b) of the Acts Interpretation Act 1931 (Tas); and s 48(b) of the Interpretation of Legislation Act 1984 (Vic). No differently from other provisions of the Acts Interpretation Act, application of s 21(1)(b) to a particular Commonwealth Act is "subject to a contrary intention"37. However, no search for a contrary intention is needed in order to reject BHP's argument that the provision requires that the references to "group member" in s 33A and "other persons" in s 33D of the Act be construed to exclude non-residents. The argument is founded on a misapprehension of what application of the provision involves. Section 21(1)(b) of the Acts Interpretation Act says nothing in terms about how statutory references to "persons" are to be understood38. It is not concerned with the meaning of any particular statutory expression. The concern of s 21(1)(b) of the Acts Interpretation Act with "references to localities jurisdictions and other matters and things" in a Commonwealth statute is not with the manner of expression of a statutory reference but more substantively with the subject matter to which statutory reference is made. Its instruction that all such references are to be "construed" as "references to such localities jurisdictions and other matters and things in and of the Commonwealth" is a requirement that the statute be construed to ensure that a connection exists between the subject matter to which the statute refers, on the one hand, and the Commonwealth of Australia understood compositely as a geographically bounded polity39, on the other hand. The "exact nature" of the requisite connection is not prescribed40. That is left by the provision to be determined in the construction of the particular statute: "to be implied or imported upon a consideration of the context and the subject matter"41. Section 21(1)(b) operates the Acts Interpretation Act, which requires preference to be given in the construction of the particular statute to the construction which would best achieve the statutory in harmony with s 15AA of 37 Section 2(2) of the Acts Interpretation Act 1901 (Cth). 38 Contra Solomons v District Court (NSW) (2002) 211 CLR 119 at 138 [37]. 39 Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society (1934) 50 CLR 581 at 612-613. See also Solomons v District Court (NSW) (2002) 211 CLR 119 at 130 [9]; Bakewell v The Queen (2009) 238 CLR 287 at 301 [36]. 40 Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society (1934) 50 CLR 581 at 600. 41 Kay's Leasing Corporation Pty Ltd v Fletcher (1964) 116 CLR 124 at 142. See also DRJ v Commissioner of Victims Rights [No 2] (2020) 103 NSWLR 692 at 717-721 purpose or object42. Depending on what would best achieve the purpose or object of the particular statute in question, a construction which results in the existence of a connection sufficient to satisfy the requirement of the provision might be arrived at in a variety of ways and might well be arrived at through the concurrent application of the common law presumption. The requirement of a provision like s 21(1)(b) has been found in some contexts to be satisfied by treating a law of "apparently universal application" as "applying to acts and omissions taking place in the territory of the legislature"43. In other contexts, it has been satisfied by treating the operation of a statute as "hinging on the place of performance of [a] contract"44. In yet other contexts, it has been satisfied by limiting the operation of a statute to contracts the proper law of which according to applicable principles of private international law is that of the enacting legislature45. No one form of connection fits every statutory subject matter in every statutory context, and no implied limitation of statutory language is necessarily required for the connection required by s 21(1)(b) of the Acts Interpretation Act to exist in a particular statutory context. For example, in Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc46, no limitation was appropriate to be implied into a statutory regime conferring jurisdiction to conciliate and arbitrate "industrial issues". The requisite connection between the subject matter and the Commonwealth was apparent in the definition of "industrial issues" provided by the statute, which relevantly included matters pertaining to the relationship between employers and maritime employees so far as those matters related to trade or commerce between Australia and a place outside Australia. 42 See Thiess v Collector of Customs (2014) 250 CLR 664 at 672 [23]; Port of Newcastle Operations Pty Ltd v Glencore Coal Assets Australia Pty Ltd (2021) 96 ALJR 56 at 71 [89]; 395 ALR 209 at 227-228. 43 Akai Pty Ltd v People's Insurance Co Ltd (1996) 188 CLR 418 at 443. Eg Grannall v C Geo Kellaway & Sons Pty Ltd (1955) 93 CLR 36 at 52-53. Insight Vacations Pty Ltd v Young (2011) 243 CLR 149 at 162 [36]. 45 Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society (1934) 50 CLR 581 at 601; Kay's Leasing Corporation Pty Ltd v Fletcher (1964) 116 CLR 124 at 142-143; Westport Insurance Corporation v Gordian Runoff Ltd (2011) 244 CLR 239 at 257 [4]. See also Akai Pty Ltd v People's Insurance Co Ltd (1996) 188 CLR 418 at 443; Insight Vacations Pty Ltd v Young (2011) 243 CLR 149 (2003) 214 CLR 397. There are statutory contexts in which discerning a connection of the kind required by s 21(1)(b) of the Acts Interpretation Act can give rise to issues of some complexity47. This is not one of them. The Act establishes the Federal Court48 – an institution for the administration of justice in and for the Commonwealth – and provides for the Federal Court to have such jurisdiction as is vested in it under other Commonwealth laws49. Part IVA is concerned with procedures and powers of the Federal Court relating to the exercise of jurisdiction so vested. No further or more specific territorial connection is required for Pt IVA in its totality to be characterised as referring to jurisdictions, matters and things in and of the Commonwealth. Section 21(1)(b) of the Acts Interpretation Act therefore provides no basis to construe Pt IVA of the Act as being restricted in the manner which BHP contends. International comparisons Finally, referring to a recently published international survey50, BHP observes that the application of class action legislation to non-residents is currently the subject of differing legislative choices in different national jurisdictions. The observation serves to emphasise that the question arising in the appeal, in the context of Pt IVA, is entirely one of statutory construction. The observation does nothing to assist answering that question. Disposition The appeal is to be dismissed with costs. 47 Eg Mynott v Barnard (1939) 62 CLR 68 at 73-74; Insight Vacations Pty Ltd v Young (2011) 243 CLR 149 at 159-162 [28]-[36]. 48 Section 5 of the Act. 49 Section 19 of the Act. 50 Mulheron, "Asserting personal jurisdiction over non-resident class members: comparative insights for the United Kingdom" (2019) 15 Journal of Private International Law 445. Gordon EdelmanJ GORDON, EDELMAN AND STEWARD JJ. The issue in this appeal is a question of statutory construction: is Pt IVA of the Federal Court of Australia Act 1976 (Cth), which permits claims to be brought by a representative party on behalf of group members, capable of applying to claims of group members who are not resident in Australia? The appellant, BHP Group Limited ("BHP"), contended that a statutory51 and common law rule of construction – that, subject to a contrary intent, requires words in a statute describing acts, matters or things in general words to be read so as not to have extraterritorial effect – must be applied to Pt IVA so that the Part does not permit a representative proceeding to extend to group members who are not resident52 in Australia. For the reasons that follow, BHP's contention is rejected and the appeal from the Full Court of the Federal Court of Australia should be dismissed. The starting point is the proper construction of Pt IVA53. That is because, depending on the particular statute and its subject matter, the common law and statutory presumptions against extraterritoriality may have little or no role to play in the process of construction. Having regard to its text, context and purpose, Pt IVA encompasses all persons, irrespective of whether they are Australian residents, who have "claims" of the kind described in s 33C(1) of the Federal Court of Australia Act, so long as the claims include one claim under the various laws made by the Federal Parliament which vest jurisdiction in the Federal Court, including its accrued jurisdiction54. The territorial connection of Pt IVA is direct and specific; it concerns the jurisdiction of the Federal Court. It is not necessary or appropriate to infer any further territorial limit into Pt IVA. 51 Acts Interpretation Act 1901 (Cth), s 21(1)(b). 52 Assuming "resident" has a common or established meaning. 53 See, eg, Barcelo v Electrolytic Zinc Co of Australasia Ltd (1932) 48 CLR 391 at 422-423, see also 406-407; Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society (1934) 50 CLR 581 at 601, 606-607, 611-612; Mynott v Barnard (1939) 62 CLR 68 at 75-76; Meyer Heine Pty Ltd v China Navigation Co Ltd (1966) 115 CLR 10 at 22-24; Old UGC Inc v Industrial Relations Commission (NSW) (2006) 225 CLR 274 at 283 [23]; Insight Vacations Pty Ltd v Young (2011) 243 CLR 149 at 161-162 [32]-[36]. 54 Federal Court of Australia Act, s 19. See also Fencott v Muller (1983) 152 CLR 570 at 603-610; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 571-572 [7]-[10], 585-586 [51]-[55]. Gordon EdelmanJ Background BHP is a company registered in Australia and listed on the Australian Securities Exchange ("ASX"). At the relevant time, BHP had a dual listed company structure with a separate company, then known as BHP Billiton Plc ("BHP Plc"). BHP Plc was registered in the United Kingdom and listed on the London Stock Exchange ("LSE"), with a secondary listing on the Johannesburg Stock Exchange ("JSE"). Under the dual listed company structure, BHP and BHP Plc operated as if they were a single unified economic entity with a unified board and management team. BHP55 held a 50 per cent interest in a Brazilian company that owned and operated the Germano Complex in Brazil, which included the Fundão Dam. On 6 November 2015 (AEST), the Fundão Dam failed, releasing a significant volume of tailings and resulting in loss of life and other consequences. On 6 and 9 November 2015, BHP made announcements on the ASX relating to the incident. Following these announcements, the price of BHP shares on the ASX – and BHP Plc shares on the LSE and JSE – declined significantly. The respondents are the representative applicants in a class action commenced against BHP in the Federal Court of Australia under Pt IVA of the Federal Court of Australia Act. The group members are relevantly defined to include persons who, during a specified period, contracted to acquire an interest in fully paid up ordinary shares in one or more of BHP on the ASX, BHP Plc on the LSE, and BHP Plc on the JSE, and are alleged to have suffered loss by reason of BHP's conduct. The representative applicants allege that, between August 2012 and November 2015, BHP was aware of certain information and risks relating to the Fundão Dam and that, contrary to the continuous disclosure obligations under the ASX Listing Rules and s 674(2) of the Corporations Act 2001 (Cth), BHP did not inform the ASX of those matters prior to 9 November 2015. The representative applicants also allege that BHP engaged in misleading or deceptive conduct contrary to s 12DA(1) of the Australian Securities and Investments Commission Act 2001 (Cth) and s 1041H(1) of the Corporations Act. Before this Court, there was no dispute that the group members' claims could be brought in the Federal Court and, as will be seen, were claims over which the Federal Court had subject matter jurisdiction. Statutory framework Section 71 of the Commonwealth in the federal courts the Parliament creates. The Federal Court is the Constitution vests judicial power of the 55 Through a wholly-owned subsidiary, BHP Billiton Brasil Ltda. Gordon EdelmanJ such a court. It is a statutory court established by s 5 of the Federal Court of Australia Act. That Act does not confer jurisdiction – s 19 provides that "[t]he [Federal] Court has such original jurisdiction as is vested in it by laws made by the Parliament" (emphasis added) – but rather governs how that jurisdiction is to be exercised. Jurisdiction under federal law is the authority to adjudicate derived from the Commonwealth Constitution and laws56. Federal courts, other than the High Court, owe their jurisdiction to laws enacted under s 77(i) of the Constitution57. In its terms, s 77(i) allows the conferral of jurisdiction with respect to any of the "matters" mentioned in ss 75 and 76 of the Constitution. As was explained in Re McJannet; Ex parte Minister for Employment, Training and Industrial Relations "The matters mentioned in ss 75 and 76 identify federal jurisdiction by such characteristics as identity of parties (s 75(iii), (iv)), remedy sought (s 75(v) itself), content (interpretation of the Constitution – s 76(i)), and source of the rights and liabilities which are in contention (ss 75(i), 76(ii)) ... For this litigation, the particular jurisdiction of the Federal Court invoked by the applicants had been defined by the Parliament with respect to matters arising under laws made by it (s 76(ii))." That is also the position in this litigation. The Federal Court's jurisdiction is defined by Parliament with respect to matters arising under Commonwealth laws (s 76(ii)) in two ways. First, s 39B(1A)(c) of the Judiciary Act 1903 (Cth) gives the Federal Court original jurisdiction in any matter arising under any laws made by 56 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142. See also Ah Yick v Lehmert (1905) 2 CLR 593 at 603; Gould v Brown (1998) 193 CLR 346 at 379 [15]; Lipohar v The Queen (1999) 200 CLR 485 at 516-517 [78]; Edensor Nominees (2001) 204 CLR 559 at 570 [2]; Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 219 CLR 365 at 377 [6], 394-395 [68]; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 349-350 [24], 353 [31]; Rizeq v Western Australia (2017) 262 CLR 1 at 12 [8], 22 [49]-[50]; Burns v Corbett (2018) 265 CLR 304 at 330 [20], 346-347 [70]-[71], 365 [124], 57 Edensor Nominees (2001) 204 CLR 559 at 571 [7]. (1995) 184 CLR 620 at 653, quoted with approval in Edensor Nominees (2001) 204 CLR 559 at 584-585 [50]. Gordon EdelmanJ the Parliament59 (this provision has been described as transforming the Federal Court into a court of general federal jurisdiction60). Second, provisions of numerous other Commonwealth statutes vest jurisdiction in the Federal Court, generally with respect to matters arising under those Acts61. It is well established that a "matter" under the Constitution does not mean a legal proceeding between parties or a bare description of a subject matter that falls within a head of federal legislative power62. The concept is far broader – it is a justiciable controversy identifiable independently of the proceeding brought for its determination and encompassing all claims made within the scope of the controversy63. The word "matters" is of "such generality that it necessarily takes its content from the categories of matter which fall within federal jurisdiction and from the concept of 'judicial power'"64. In sum, for there to be a matter in the Federal Court: the Court must have been given jurisdiction with respect to it under s 77(i) of the Constitution; there must generally be an immediate right, duty or liability to be established by the determination of the Court65; the party instituting the proceeding must have the appropriate standing or interest to have the dispute 59 Other than a matter in respect of which a criminal prosecution is instituted or any other criminal matter: Judiciary Act, s 39B(1A)(c). 60 Stellios, The Federal Judicature: Chapter III of the Constitution, 2nd ed (2020) at 448 [8.4], referring to Lindell, Cowen and Zines's Federal Jurisdiction in Australia, 4th ed (2016) at 158. 61 The Federal Court's jurisdiction is conferred by over 150 Commonwealth Acts: Stellios, The Federal Judicature: Chapter III of the Constitution, 2nd ed (2020) 62 B (2004) 219 CLR 365 at 377 [7]. 63 Fencott (1983) 152 CLR 570 at 603-606. See also South Australia v Victoria (1911) 12 CLR 667 at 675. 64 Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 610 [42]. In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; Truth About Motorways (2000) 200 CLR 591 at 610-611 [43]; B (2004) 219 CLR 365 at 375-376 Gordon EdelmanJ resolved66; and the controversy must be capable of being determined by exercise of judicial power and "in accordance with the independently existing substantive law"67. In addition to jurisdiction with respect to subject matter, and the territorial area over which that subject matter may extend, the Federal Court must also have personal jurisdiction, or authority to hear and determine a personal action68. That authority stems from the amenability of the respondent to the Court's process69. The Court's personal jurisdiction is established by valid service on the respondent within the territory, the respondent's voluntary submission to the jurisdiction or, in some circumstances, valid service on the respondent outside the territory70. This appeal is not concerned with the geographic dimension of the Federal Court's jurisdiction ("over which territory does the authority to exercise power extend?")71. Part IVA of the Federal Court of Australia Act operates within the scheme of the whole of that Act and the Acts which vest the Federal Court with jurisdiction. Part IVA permits a person or persons to commence a representative proceeding in the Federal Court on behalf of group members where certain statutory criteria are met. Section 33C(1) is the foundational provision, setting out the criteria: seven or more persons must each have claims against the same person that are in respect of or arise out of the same, similar or related circumstances, and the claims of all seven or more of those persons must give rise to a substantial common issue of law or fact. Where those criteria are satisfied, "a proceeding may 66 Croome v Tasmania (1997) 191 CLR 119 at 132-133; Hobart International Airport Pty Ltd v Clarence City Council (2022) 96 ALJR 234 at 245-246 [31], 256-257 [79]; 399 ALR 214 at 223, 237. 67 Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168 at 205. See also Hobart International Airport (2022) 96 ALJR 234 at 249 [47]; 399 ALR 214 at 227. 68 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 517 [13]-[14], 521 [25]; Edensor Nominees (2001) 204 CLR 559 at 570 [2]; Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 35 [53]. 69 Mobil Oil (2002) 211 CLR 1 at 35 [53]. 70 Mobil Oil (2002) 211 CLR 1 at 37-38 [60]-[61]. See also Federal Court Rules 2011 (Cth), Pts 10-12. 71 See, eg, Federal Court of Australia Act, ss 3,18; Rizeq (2017) 262 CLR 1 at 48 Gordon EdelmanJ be commenced by one or more of those persons as representing some or all of them"72. It will be necessary to return to this aspect of s 33C(1). Other provisions of the Part set out various notice requirements, create an opt out process for group members, provide for matters relating to determination, settlement and discontinuance of proceedings, and confer on the Court broad discretionary powers to manage the running of a representative proceeding or order that the proceeding no longer continue as a representative proceeding. Section 33ZB sets out the effect of judgment: a judgment given in a representative proceeding binds all such group members who are identified by the Court to be affected by it, except for those group members who have opted out of the proceeding. Four points should be made. First, like the other Parts of the Federal Court of Australia Act (which should be read as a harmonious whole73), Pt IVA is procedural, not substantive74. As unanimously held by this Court in Wong v Silkfield Pty Ltd, "Part IVA creates new procedures and confers upon the Federal Court new powers in relation to the exercise of jurisdiction with which it has been invested by another law made by the Parliament"75. As has just been explained, the Federal Court of Australia Act does not confer jurisdiction on the Federal Court – that jurisdiction is found in other statutes passed by Parliament. Second, the Federal Court of Australia Act distinguishes between a "matter" and the claim or claims that are properly brought forward by the parties to the matter76. All group members must have "claims" under s 33C of the Federal Court of Australia Act. Such claims are an integral part of the "matter" in respect of which the Federal Court has jurisdiction77. Put in different terms, the "claims" to which s 33C refers have an existence prior to and separately from the 72 Federal Court of Australia Act, s 33C(1) (emphasis added). 73 Johns v Australian Securities Commission (1993) 178 CLR 408 at 452; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[70]. See also Wigmans v AMP Ltd (2021) 270 CLR 623 at 658 [85]. 74 BMW Australia Ltd v Brewster (2019) 269 CLR 574 at 628 [136]. (1999) 199 CLR 255 at 258 [1]. 76 See Federal Court of Australia Act, s 22. 77 See Femcare Ltd v Bright (2000) 100 FCR 331 at 355-356 [98]-[104]. Gordon EdelmanJ commencement of the class action78 and encompass the facts and circumstances which are said to give rise to the action and the legal rights that are asserted as the basis for the action79. As Murphy and Colvin JJ stated in Dyczynski v Gibson80: "[T]o say that a class member has a 'claim' is not to say that the person has a right or entitlement to relief; but rather that there exists facts, circumstances and legal rights anterior to and independent of the class action, which may ground a right or entitlement to relief when that person's claim is ultimately heard and determined by the Court". In short, Pt IVA does not create the justiciable issue between the respondent and the group members; the "matter" and the claims that make it up necessarily exist independently of the representative proceeding. Part IVA is a procedural mechanism that allows for the grouping of existing claims. Third, while it can be accepted that, without Pt IVA (or an equivalent provision for representative proceedings), the Federal Court could not bindingly adjudicate the claims of the non-party group members unless those persons brought their own proceedings or fell within an established procedure such as one deriving from the procedures of the Court of Chancery81, the Court does not need to separately establish personal jurisdiction over the group members in representative proceedings82. What matters is that the Court has personal jurisdiction over the respondent. As this Court explained in Mobil Oil Australia Pty Ltd v Victoria83, to accept the proposition that a court's authority should be confined only to those group members who voluntarily invoke the jurisdiction or are connected with the geographic jurisdiction "would require a radical departure 78 Dyczynski v Gibson (2020) 280 FCR 583 at 627 [166], citing Wong v Silkfield Pty Ltd (1999) 199 CLR 255 at 266 [26], Bright v Femcare Ltd (2002) 195 ALR 574 at 577 [10], 600 [124] and Australian Competition and Consumer Commission v Giraffe World Australia Pty Ltd (1998) 84 FCR 512 at 523. 79 Dyczynski (2020) 280 FCR 583 at 627-628 [167]-[168]. 80 Dyczynski (2020) 280 FCR 583 at 628 [168] (emphasis in original). 81 Williams and Guthrie-Smith (eds), Daniell's Chancery Practice, 8th ed (1914) vol 82 Mobil Oil (2002) 211 CLR 1 at 23 [10]-[11], 35 [53], 36 [56]. (2002) 211 CLR 1. Gordon EdelmanJ from the hitherto accepted understanding of the basis upon which State and federal courts exercise authority to decide personal actions. That authority stems from the amenability of the [respondent] to the court's process"84. Part IVA was enacted with the knowledge that personal jurisdiction is dependent on the amenability of the respondent to the jurisdiction, not the presence in the territory of persons on whose behalf the proceeding is being advanced. As with the Victorian class action regime under consideration in Mobil Oil, the bases upon which the Federal Court can assume jurisdiction over a respondent in a personal action were "untouched" by the provisions made for representative proceedings in Pt IVA85. Fourth, Pt IVA provides for a process that enables unwilling group members to opt out of the proceeding86. Parliament did not, when enacting Pt IVA, alter the bases of the jurisdiction of the Federal Court. Instead, Parliament chose the opt out provisions87 as the statutory mechanism to ensure that persons are not made subject to the Court's jurisdiction (or bound by a judgment given in a representative proceeding) if they are unwilling to participate88. The integrity of Pt IVA "depends upon group members having the right to opt out"89. The opt out mechanism has a central place in the scheme: the hearing of a representative proceeding must not, except with the leave of the Court, commence earlier than the date before which a group member may opt out of the proceeding90. The Court has a power to order notices at any stage91, and certain notices are mandatory, 84 Mobil Oil (2002) 211 CLR 1 at 35 [53]; see also 23 [10]-[11]. 85 Mobil Oil (2002) 211 CLR 1 at 38 [61]. 86 See Mobil Oil (2002) 211 CLR 1 at 34-35 [51]. 87 See, eg, Federal Court of Australia Act, ss 33J, 33K(4), 33X, 33Y, 33ZB, 33ZE. 88 Australia, House of Representatives, Parliamentary Debates (Hansard), 14 November 1991 at 3175. 89 BMW Australia (2019) 269 CLR 574 at 629 [137]. See also Femcare (2000) 100 FCR 331 at 347-348 [67]-[68], 349 [75]; Wigmans (2021) 270 CLR 623 at 90 BMW Australia (2019) 269 CLR 574 at 629 [137], referring to Federal Court of Australia Act, s 33J(4); see also 630 [142]. See also Pharm-a-Care Laboratories Pty Ltd v Commonwealth of Australia [No 4] [2010] FCA 749 at [22]; Blairgowrie Trading Ltd v Allco Finance Group Ltd (In liq) (2015) 325 ALR 539 at 573 [180]; Dyczynski (2020) 280 FCR 583 at 648 [270]. 91 Federal Court of Australia Act, s 33X(5). Gordon EdelmanJ including the notice of group members' right to opt out before a specified date that is prior to the hearing of the representative proceeding92. Although "the reality is that ... notice[s] may not have come to the attention of, or been fully appreciated by, all group members"93, the Court is given flexible powers to ensure that notice is reasonably likely to come to the person's attention94 and to protect the integrity of the opt out process (for example, by ensuring that public representations made during the opt out period are not misleading)95. Statutory construction and the "presumption" against extraterritoriality In statutes96, like the Federal Court of Australia Act, where there is no express provision relevantly addressing the territorial reach of the subject matter of the statute, the task is to identify the hinge97 (also referred to as the statutory legislative concern100, springboard98, general subject matter99, object of 92 Federal Court of Australia Act, s 33X(1)(a). 93 BMW Australia (2019) 269 CLR 574 at 630 [142], quoting Blairgowrie Trading (2015) 325 ALR 539 at 573 [180]. See also Femcare (2000) 100 FCR 331 at 348 94 Federal Court of Australia Act, ss 33X, 33Y. 95 See, eg, Jarra Creek Central Packing Shed Pty Ltd v Amcor Ltd [2008] FCA 575 at [18]-[19]; see also [9], referring to Federal Court of Australia Act, ss 23, 33J, 33K and 33X. 96 Putting to one side statutes creating criminal offences, to which different considerations will apply. Insight Vacations (2011) 243 CLR 149 at 162 [36]; Old UGC Inc (2006) 225 CLR 98 Law Society of New South Wales v Glenorcy Pty Ltd (2006) 67 NSWLR 169 at 177-178 [35]-[43]. See also DRJ v Commissioner of Victims Rights [No 2] (2020) 103 NSWLR 692 at 732 [157]; Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v Darnia-Wilson [2022] FCAFC 28 at 99 Mynott (1939) 62 CLR 68 at 86. See also Kay's Leasing Corporation Pty Ltd v Fletcher (1964) 116 CLR 124 at 143-144. 100 Barcelo (1932) 48 CLR 391 at 423; Wanganui-Rangitikei (1934) 50 CLR 581 at Gordon EdelmanJ central conception101, character102 or central focus103) of the statute and identify its territorial connection, if any. The applicable provisions, read in context, may have a hinge or subject matter with a clear territorial connection104. That task – of identifying the "central focus" of a statute – is purely a question of statutory construction. As Leeming JA said in DRJ v Commissioner of Victims Rights [No 2]105, the hinge or central focus is identified "as a matter of construction, based on subject matter and scope, and with a regard to internal indications and to avoiding improbable and absurd outcomes. It will be relevant to have regard to the purpose of the statute, the likelihood that the statutory purpose will be evaded if made to depend upon something readily altered at the instance of the parties, and the need to avoid an unduly restrictive approach whereby more than one factum is required to bear a connection". That approach to construction has been applied in a variety of contexts, including: where statutes modified or voided contractual rights and obligations (Barcelo v Electrolytic Zinc Co of Australasia Ltd106, Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society107 and Kay's Leasing Corporation Pty Ltd v Fletcher108); where a statute was concerned with liability for negligence in relation to the supply of recreational services (Insight Vacations Pty Ltd v Young109); where statutes provided for compensation in relation to 101 Old UGC Inc (2006) 225 CLR 274 at 283 [23]; Infosys Technologies Ltd v Victoria (2021) 64 VR 61 at 64 [7], 72 [44]. 102 Mynott (1939) 62 CLR 68 at 86. 103 Insight Vacations (2011) 243 CLR 149 at 161 [33]. 104 See, eg, Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc (2003) 214 CLR 397 at 415-416 [41]-[43]. 105 (2020) 103 NSWLR 692 at 732 [157]. Putting to one side the different considerations applicable to legislation creating an offence. 106 (1932) 48 CLR 391 at 421-422. 107 (1934) 50 CLR 581 at 601, 606-607, 611-612. 108 (1964) 116 CLR 124 at 143-144. 109 (2011) 243 CLR 149 at 161-162 [32]-[36]. Gordon EdelmanJ accidents or acts of violence (Mynott v Barnard110 and DRJ111 respectively); and where statutes were concerned with the performance of work within an industry (Old UGC Inc v Industrial Relations Commission (NSW)112) or for a continuous period of time with one employer (Infosys Technologies Ltd v Victoria113). Only after identifying the hinge of the provisions and revealing the territorial connection (if any) of the subject matter, does the question of the application of the common law presumption against extraterritoriality arise114. The so-called "presumption" is an interpretive principle whose force depends upon the extent to which the hinge of the provisions departs from common expectations that Parliament's concern with the subject matter is limited to matters within its territory. Put another way, the general common law presumption of territoriality – that an enactment describing acts, events, matters or things in general words, so that, if constrained by no consideration lying outside its expressed meaning, its application would be universal, should not be understood as extending extraterritorially115 – is a rule of construction only and "it may have little or no place where some other restriction is supplied by context or subject matter [of the statute in issue]"116. Whether a restriction is supplied by the context or the nature of the subject matter is a question of statutory construction which necessarily precedes the application of the presumption. This Court has never taken a uniform or mechanistic approach to applying the presumption117. Where the hinge or the central focus of the subject matter is identified and it does not have a clear territorial connection (that is, it appears to be at large), the presumption will generally require that the hinge be construed as 110 (1939) 62 CLR 68 at 75-77, 86. 111 (2020) 103 NSWLR 692 at 733-736 [158]-[179]. 112 (2006) 225 CLR 274 at 282-283 [22]-[23]. 113 (2021) 64 VR 61 at 77 [67], 78-79 [73], 80 [79]. 114 Old UGC Inc (2006) 225 CLR 274 at 283 [23]. See also Insight Vacations (2011) 243 CLR 149 at 161 [32]-[33]. 115 See Jumbunna Coal Mine NL v Victorian Coal Miners' Association (1908) 6 CLR 309 at 363; Wanganui-Rangitikei (1934) 50 CLR 581 at 600-601. 116 Wanganui-Rangitikei (1934) 50 CLR 581 at 601. 117 See DRJ (2020) 103 NSWLR 692 at 720-721 [113]-[119]. Gordon EdelmanJ territorially limited, subject to a contrary intention118. Where the central focus of the subject matter of the statute, on its proper construction, has a territorial connection, it will ordinarily be unnecessary to look for further territorial restrictions119. The presumption has never been understood such that it needed to be applied to all elements or words in a statute. Section 21(1)(b) of the Acts Interpretation Act 1901 (Cth) does not compel a different approach or give rise to a different conclusion120. Section 21(1)(b) provides that "[i]n any Act ... references to localities jurisdictions and other matters and things shall be construed as references to such localities jurisdictions and other matters and things in and of the Commonwealth"121. Section 21(1)(b) does not answer the question: what is the matter or thing which should be construed, subject to contrary intent, as "in and of" the Commonwealth? And, as this Court said in Insight Vacations122, "the question of geographical limitation arises regardless of the engagement of a provision such as" s 21(1)(b) of the Acts Interpretation Act. The common rules of statutory construction, law including those relating to the "presumption" against extraterritoriality, step in to assist in identifying the territorial restriction123. Where the statute is in general terms, and where s 21(1)(b) applies, the approach to construction of the statute and the conclusion are necessarily the same. 118 Insight Vacations (2011) 243 CLR 149 at 161-162 [32]-[36]. See also Barcelo (1932) 48 CLR 391 at 422-423, see also 406; Wanganui-Rangitikei (1934) 50 CLR 581 at 601, 606-607, 611-612; Mynott (1939) 62 CLR 68 at 75-77; Old UGC Inc (2006) 225 CLR 274 at 283 [23]. 119 Barcelo (1932) 48 CLR 391 at 422; Old UGC Inc (2006) 225 CLR 274 at 283 [23], see also 278 [1], 292 [59]; Insight Vacations (2011) 243 CLR 149 at 161-162 120 See Wanganui-Rangitikei (1934) 50 CLR 581 at 600-601; Insight Vacations (2011) 243 CLR 149 at 159-162 [27]-[36]. 121 See also Acts Interpretation Act, s 2(2), which provides that the application of the Act is subject to a contrary intention. 122 (2011) 243 CLR 149 at 159 [28], citing Kay's Leasing (1964) 116 CLR 124 at 123 Wanganui-Rangitikei (1934) 50 CLR 581 at 600-601. Gordon EdelmanJ The hinge or central focus of the subject matter of Pt IVA of the Federal Court of Australia Act As has been observed, the sole issue is the proper construction of Pt IVA: can group members in representative proceedings include non-residents of Australia? Section 33C is generally worded124. There is no express geographic or territorial restriction in s 33C or elsewhere on the identity of the "persons" who can be representative applicants or group members (or indeed, respondents) in a representative proceeding. BHP's argument proceeds from the position that the statutory and common law presumption against extraterritoriality must apply so that s 33C should be read as not permitting non-resident group members. BHP sought to draw a distinction between representative applicants and group members in a representative proceeding on the basis that the representative applicants, but not the group members, had submitted to the jurisdiction of the Federal Court. That is the wrong starting point. The hinge by which the Federal Court of Australia Act operates is the powers and procedures for determining proceedings within the Court's jurisdiction. That hinge thus depends on s 19, which provides that the Court has such original jurisdiction as is vested in it by laws made by the Parliament. Absent those laws, the Federal Court has no jurisdiction. Part IVA operates by allowing the grouping of "claims" where each group member has at least one claim under one of the laws which have vested jurisdiction in the Federal Court. For example, in this case, the grouped claims are under the Corporations Act and the Australian Securities and Investments Commission Act. As Moshinsky J observed at first instance, the territorial reach of the Court's powers over the subject matter in Pt IVA is necessarily as extensive as the substantive laws which confer that jurisdiction in relation to particular claims. Territorial limits might be found in the substantive laws. Otherwise, if those laws do extend to claims for loss and damage by persons who are not resident in Australia, then the Court may exercise its powers in relation to those persons. But accepting that non-residents may be group members under Pt IVA in such circumstances is not to say that the Federal Court of Australia Act operates "extraterritorially" in any relevant sense. The determination of the group members' claims, as a matter of Australian law, does not have any effect or execution outside Australia125. Given the clear territorial connection of the Court's 124 See [52] above. 125 Federal Court of Australia Act, s 18. Gordon EdelmanJ jurisdiction, neither the Federal Court of Australia Act nor Pt IVA has extraterritorial operation that would engage the presumption. BHP's construction of Pt IVA ignores the Constitution and the legislation passed by the Commonwealth Parliament vesting jurisdiction in the Federal Court, and rewrites the Federal Court of Australia Act. BHP's construction would require Pt IVA to read that "the powers and procedures within the Part only apply to persons [resident] within Australia such that a representative applicant cannot bring a claim on behalf of a non-resident" (emphasis added). BHP does not explain how Pt IVA alone of all of the Parts in the Federal Court of Australia Act should be or could be interpreted in that way. None of the fundamental principles or bases for establishing the jurisdiction of the Federal Court is confined by reference to an applicant's location or residence. BHP's construction would signal a "radical departure" from the accepted bases126. Part IVA does not show any intention to affect or alter those fundamental principles or bases of jurisdiction. Instead, Pt IVA takes the Federal Court's jurisdiction as it finds it; it regulates the procedure "for dealing not only with claims that are made, but also claims that could be made" against a respondent amenable to the jurisdiction of the Federal Court127. The claims must satisfy the criteria in s 33C – namely seven or more persons must have claims against the same person that are in respect of or arise out of the same, similar or related circumstances, and those claims must give rise to a substantial common issue of law or fact – and at least one of those claims must be a claim over which the Federal Court has been vested with jurisdiction by a federal Act to hear and determine. In such a context – interpreting a provision that governs how the jurisdiction of an Australian court is to be exercised; a matter so directly territorially connected to Australia – the presumption against the extraterritorial operation of legislation does not have any role to play. There is no basis to apply the presumption to exclude group members who may reside outside of the physical territory of the jurisdiction. Who makes the claim and where they live does not determine the jurisdiction of the Federal Court or the claims that may be brought in accordance with the procedures in Pt IVA. BHP placed considerable reliance on s 33ZB, which provides that a judgment given in a representative proceeding binds all group members who are identified by the Court to be affected by it, other than persons who have opted out of the proceeding. BHP submitted that this should be presumed not to apply to 126 Mobil Oil (2002) 211 CLR 1 at 35 [53]. 127 Mobil Oil (2002) 211 CLR 1 at 38 [61] (emphasis added). Gordon EdelmanJ persons outside the territory and that there is no textual or contextual contrary intention. In support of that contention, BHP submitted that s 33ZB is essential to ensuring that respondents are not subjected to multiple proceedings brought in respect of the same subject matter by or on behalf of the same persons. That contention should be rejected. As the Full Court emphasised, s 33ZB only binds persons as a matter of Australian law. The parties accept that s 33ZB is not capable of, and does not purport to, affect a person's rights under foreign law in respect of the same or similar subject matter. Whether Australian judgments will be recognised in other jurisdictions, and in what circumstances, is a matter for foreign law. It is unnecessary to fully address the question, raised in submissions, of whether the common law presumption only applies where a statute extends to subject matters over which, according to the comity of nations or international law, another sovereign or state properly has jurisdiction. That is not what Pt IVA does. For present purposes, it is sufficient to recognise that the common law presumption has been stated without reference to128, and applied without reliance on129, the comity of nations or international law. The "presumption" is a rule of statutory recognised construction. Given extraterritorial legislative competence, it is important not to conflate the question of statutory construction with that of constitutional validity: "the fact that a provision in a particular form would have been within the competence of the legislature does not provide any positive assistance towards the true construction of a provision expressed in perfectly general terms without any territorial restriction"130. Regardless of any inconsistency with international law or comity, the common law presumption has been applied, for example, to construe the territorial limits of legislation conferring entitlements in apparently universal terms the Commonwealth Parliament's now 128 cf Jumbunna Coal Mine (1908) 6 CLR 309 at 363; Morgan v White (1912) 15 CLR 1 at 13; Seaegg v The King (1932) 48 CLR 251 at 255; Meyer Heine (1966) 115 CLR 10 at 30-31, 43; Chubb Insurance Company of Australia Ltd v Moore (2013) 302 ALR 101 at 132-133 [144]-[147]; Australian Competition and Consumer Commission v Air New Zealand Ltd (2014) 319 ALR 388 at 469 [386]; DRJ (2020) 103 NSWLR 692 at 698 [11], 722-723 [122]-[123]. 129 In the context of Commonwealth legislation, see, eg, Meyer Heine (1966) 115 CLR 10 at 23-24, 30-33, 43. See also Darnia-Wilson [2022] FCAFC 28 at [14]-[18], 130 Mynott (1939) 62 CLR 68 at 75. See also R v Foster; Ex parte Eastern and Australian Steamship Co Ltd (1959) 103 CLR 256 at 275. Gordon EdelmanJ (such as forms of statutory compensation131 or workplace entitlements like long service leave132). Text BHP's construction would also have the odd consequence that the same word – "person" – would be interpreted differently within s 33C. The meaning of "person" in s 33C when concerned with the respondent and the representative party is not said to be confined by residence but the meaning of "person" in s 33C when concerned with group members is to be confined by residence in Australia. Differing meanings of the word "person" within the same provision would be unlikely and anomalous, given the general assumption that words repeated in a statute are used with the same meaning133. BHP's construction is also inconsistent with the text of s 33C, which provides that, where seven or more "persons" have claims of the relevant kind, "a proceeding may be commenced by one or more of those persons as representing some or all of them" (emphasis added). The logic is clear: the "person" who commences the proceeding must be one of the group of "persons" who have claims of the relevant kind. If the representative party may be a non-resident, then, as a textual matter, necessarily so too may the group members. History That Pt IVA permits the inclusion of non-resident group members is consistent with the history of representative proceedings. As Gleeson CJ observed in Mobil Oil, "[s]ubject to the capacity of the court managing representative proceedings to control the proceedings in such a manner as to ensure fairness, a capacity usually conferred by wide discretionary powers in relation to the conduct of the action, persons represented in such proceedings were not necessarily residents of the local territory in which the proceedings were taken; and they were not even necessarily aware of the proceedings"134. Part IVA was 131 See, eg, Mynott (1939) 62 CLR 68 at 73, 75-77, 86; DRJ (2020) 103 NSWLR 692 132 See, eg, Infosys Technologies (2021) 64 VR 61 at 63-64 [2]-[7], 68 [28], 70-71 133 Tabcorp Holdings Ltd v Victoria (2016) 90 ALJR 376 at 387 [65]; 328 ALR 375 at 388-389; Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2020) 94 ALJR 818 at 838 [95]; 381 ALR 134 Mobil Oil (2002) 211 CLR 1 at 22 [6]. Gordon EdelmanJ enacted to supplement and improve the existing procedures. It did not remove or narrow access to the Court's existing jurisdiction but provided a more detailed and expansive regime compared with the pre-existing rules for representative proceedings135. As the respondents submitted, "[i]t would be incongruous to construe s 33C(1) as, on the one hand, expanding the class of persons on whose behalf a representative proceeding could be commenced by reference to the commonality of their claims but, on the other hand, narrowing the class of persons by reference to their residence". Purpose That construction is also consistent with the purposes of Pt IVA, which include, as is evident from the provisions of the Part and supported by the extrinsic materials136, the creation of an efficient and comprehensive mechanism for the determination of similar claims: that, subject to the right to opt out, "everyone with related claims should be involved in the proceedings and should be bound by the result"137. In contrast, BHP's construction would undermine the purpose of Pt IVA by not allowing non-residents to be group members in inter partes representative proceedings proceedings or be part of a representative proceeding under r 9.21 of the Federal Court Rules 2011 (Cth)). This would create a risk of a multitude of parallel proceedings or actions, directly contrary to the purpose of Pt IVA. they could commence (whereas Practical difficulties with BHP's construction BHP's submission that Pt IVA should be read down to exclude non-residents is also unworkable. Immediately, the question which would arise on that construction is: how is residence to be determined? Residence may be a complex inquiry with a range of different standards in different legislation and there would be an unresolved question of when, relative to the proceeding and the claims that are the subject of the proceeding, a person must be a resident to be a group member. BHP's contention that residence is a practical expression of the distinction between persons within the territory and outside of it, as demonstrated 135 Wong (1999) 199 CLR 255 at 267 [28]. See also Wigmans (2021) 270 CLR 623 at 655-656 [77], discussing Pt 10 of the Civil Procedure Act 2005 (NSW) (the equivalent to Pt IVA). 136 Australia, House of Representatives, Parliamentary Debates (Hansard), 14 November 1991 at 3174–3175. 137 Australian Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46 (1988) at 44 [92], see also 24 [57]. Gordon EdelmanJ by the legislative model adopted in the United Kingdom that makes a distinction between class members domiciled and not domiciled in the United Kingdom, does not assist in resolving these difficulties. Part IVA adopts what has been described as the "no-provision model"138, recognising that there are different legislative models in comparable jurisdictions. That was a deliberate legislative choice. Orders The appeal should be dismissed with costs. 138 Mulheron, "Asserting personal jurisdiction over non-resident class members: comparative insights for the United Kingdom" (2019) 15 Journal of Private International Law 445 at 452-455.
HIGH COURT OF AUSTRALIA ICM AGRICULTURE PTY LTD ABN 32 006 077 765 & ORS AND PLAINTIFFS THE COMMONWEALTH OF AUSTRALIA & ORS DEFENDANTS ICM Agriculture Pty Ltd v The Commonwealth [2009] HCA 51 9 December 2009 ORDER Order that the questions stated in the special case be answered as follows: Question 1: By reason of s 51(xxxi) of the Constitution: did the Commonwealth lack executive power to enter into the Funding Agreement? is the [National Water Commission Act 2004 (Cth)] invalid insofar as it authorised the CEO to enter into the Funding Agreement on behalf of the Commonwealth? Answer: The replacement of the plaintiffs' bore licences did not constitute an acquisition of property within the meaning of s 51(xxxi) of the Constitution. Accordingly, the questions of invalidity posed in paragraphs (a) and (b) of Question 1 do not arise. Question 2: If the answer to either part of Question 1 is "yes", are all or any of: the Amendment Regulation; the Proclamation; the Amendment Order; invalid or inoperative as a consequence? Answer: Does not arise. Question 3: Do the plaintiffs remain the holders of all or any of the bore licences issued to them under the [Water Act 1912 (NSW)]? Answer: Question 4: If the answers to Questions 2 and 3 are "no", do the plaintiffs have an implied right under the Constitution to recover from the Commonwealth such compensation for the loss of their bore licences as would constitute "just terms" within the meaning of s 51(xxxi) of the Constitution? Answer: Does not arise. Question 5: Who should pay the costs of this Special Case? Answer: The plaintiffs. Representation R J Ellicott QC with M G McHugh and W A D Edwards for the plaintiffs (instructed by Martine Anderson Legal Counsel for ICM Australia Pty Ltd) S J Gageler SC, Solicitor-General of the Commonwealth with A Robertson SC and C L Lenehan for the first and second defendants (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales with J K Kirk for the third and fourth defendants (instructed by Crown Solicitor (NSW)) Interveners R J Meadows QC, Solicitor-General for the State of Western Australia and R M Mitchell SC intervening on behalf of the Attorney-General for the State of Western Australia (instructed by State Solicitor for Western Australia) P M Tate SC, Solicitor-General for the State of Victoria with K L Emerton SC and G A Hill intervening on behalf of the Attorney-General for the State of Victoria (instructed by Victorian Government Solicitor) W Sofronoff QC, Solicitor-General of the State of Queensland with G J D del Villar intervening on behalf of the Attorney-General of the State of Queensland (instructed by Crown Law (Qld)) M G Hinton QC, Solicitor-General for the State of South Australia with S T O'Flaherty intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor (South Australia)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. ICM Agriculture Pty Ltd v The Commonwealth Constitutional law (Cth) – Powers of Commonwealth Parliament – Agreement between Commonwealth and a State – National Water Commission Act 2004 (Cth) authorised Chief Executive Officer ("CEO") of National Water Commission to enter into funding agreement with State – Whether CEO authorised to enter into funding agreement with State for purpose of State acquiring property on other than just terms – Whether legislative power conferred by s 96 of Constitution, or by s 96 with s 51(xxxvi), is subject to limitations contained in s 51(xxxi) – Relevance of distinction between coercive and non-coercive legislative power. Constitutional law (Cth) – Powers of Commonwealth Parliament – Acquisition of property on just terms – Plaintiffs held bore licences under Water Act 1912 (NSW) ("Water Act") – Plaintiffs' licences replaced with aquifer access licences under Water Management Act 2000 (NSW) – Whether Water Act divested common law rights with respect to extraction of groundwater – Whether plaintiffs' Water Act licences property within s 51(xxxi) of Constitution – Whether replacement of licences amounted to acquisition of property. Words and phrases – "abstraction", "acquisition", "coercive and non-coercive power", "control", "just terms", "property", "the use and flow". Constitution, ss 51(xxxi), 51(xxxvi), 61, 96. Irrigation, Water, Crown Lands and Hunter Valley Flood Mitigation (Amendment) Act 1966 (NSW), s 3. National Water Commission Act 2004 (Cth), s 24. Water Act 1912 (NSW). Water Management Act 2000 (NSW), s 45(1), Sched 10, item 3. Water Rights Act 1896 (NSW), s 1(I). FRENCH CJ, GUMMOW AND CRENNAN JJ. Introduction The Lower Lachlan Groundwater System ("the LLGS") in central New South Wales covers some 29,770 square kilometres, extending from the upper limits of the Wyangala Dam to the junction of the Lachlan River with the Murrumbidgee River. Agricultural enterprise in the LLGS is dependent on a combination of groundwater and surface water. Groundwater is water occurring under the surface of the ground, regardless of whether it is moving or still, and regardless of the geological structure in which it is contained. The expression can also include artesian and sub-artesian water. Surface water is water occurring naturally that is not groundwater and includes water occurring in the whole or part of a river, lake or estuary. Demand for water for agricultural purposes in the LLGS, as in many other agricultural regions in Australia, has been affected from time to time by water shortages. Water in these areas also has an important part to play in the maintenance of environmental balance and natural ecosystems. Successive governments of the State of New South Wales ("the State") have long monitored, regulated and restricted access to and use of both groundwater and surface water. Policies have been formulated and pursued so as to achieve equitable access among water users, to mitigate adverse effects on the environment, and to ensure that water, as a finite and fluctuating natural resource, is able to be replenished for future use. The extraction and use of water has been regulated by statute since 1896, and, in particular, from 1912 principally by the Water Act 1912 (NSW) ("the 1912 Act" or "the Water Act"). The Water Management Act 2000 (NSW) ("the 2000 Act") provided1 for the repeal of the 1912 Act. This litigation follows upon the replacement of the one statutory regime with the other. The three plaintiffs conduct farming businesses on land in the State which is near the Lachlan River and within the LLGS. Extraction of groundwater from the LLGS began in the early 1960s. Before the changes to the law of the State the plaintiffs used for irrigation groundwater extracted pursuant to a number of "bore licences" issued under the 1912 Act. Water for irrigation also was drawn by the plaintiffs under licences issued pursuant to the 1912 Act for the drawing of surface water. These licences are not 1 Section 401 and Sched 7. Crennan in issue in this case. However, when dealing with submissions respecting the nature of water rights as understood both at common law and in the statute law of the State, it will be necessary to consider the legal character of both groundwater and surface water. On 1 February 2008 the bore licences were replaced by a new system of licences issued under the 2000 Act and styled aquifer access licences. These permit the plaintiffs to take less water than had been allowed under the bore licences. The loss represents a decrease in entitlements under the bore licences of about 70 per cent in the case of the first and second plaintiffs (together "ICM") and 66 per cent in the case of the third plaintiff ("Hillston"). Reference will be made later in these reasons to the steps by which the State introduced this new system. The proceedings On 6 February 2009 the plaintiffs were offered by the State what were called structural adjustment payments. These comprised a total of $818,730 to ICM and $93,830 to Hillston. The plaintiffs complain of the inadequacy of the proposed structural adjustment payments. It is conceded by the Commonwealth that the making of these payments would not amount to "just terms" within the meaning of s 51(xxxi) of the Constitution. By action commenced in the original jurisdiction of this Court, the plaintiffs contend that the steps taken under the 2000 Act to reduce their access to groundwater amount to an acquisition of their property otherwise than on just terms, contrary to the constitutional guarantee found in s 51(xxxi) of the Constitution and interpreted by decisions of this Court. Pursuant to r 27.08 of the High Court Rules 2004, there is before the Full Court a special case posing five questions for determination. The questions are so expressed as not immediately to reflect all of the issues debated before the Full Court. It is convenient to defer setting out the text of the questions, and to deal first with the circumstances of the case and the legislation of the Commonwealth and the State, and then with the fate of the submissions of the parties and interveners. The starting point is the text of s 51(xxxi), which is directed to laws made by the Parliament of the Commonwealth with respect to the acquisition of property on just terms from any State or person for any purpose in respect of which that Parliament has power to make laws. In the present case, where is there in play any relevant law of the Commonwealth? The answer the plaintiffs give to that question requires attention to dealings between the Commonwealth and the State which preceded the replacement of the bore licences on 1 February The National Water Commission The offers of structural adjustment payments were made to ICM and Hillston by the State acting pursuant to provision in the Schedule to an instrument ("the Funding Agreement") dated 4 November 2005. The parties to the Funding Agreement are the Commonwealth (the first defendant) "as represented by and acting through the National Water Commission" ("the NWC") (the second defendant) and the State (the third defendant) "as represented by and acting through the Department of Natural Resources". The Schedule stated requirements that the State, relevantly: (a) implement Water Sharing Plans, as provided for in the 2000 Act, that reduce over a 10 year period the water entitlements of licence holders to ensure sustainable future use of a number of groundwater systems including the LLGS; and (b) make "up-front ex gratia structural adjustment payments" to licence holders. The Minister administering the 2000 Act ("the Minister") is the fourth defendant. Provision of funds for the structural adjustment payments under the Funding Agreement is to be shared equally by the State and the Commonwealth. Clause 4.1 stated that, subject to sufficient appropriations and compliance by the State with the Funding Agreement, the Commonwealth would provide the State with the funding detailed in the Schedule. The term "Commonwealth" was so defined as to mean the Commonwealth as represented by and acting through the NWC. include (s 7(1)(a)) assisting with The NWC was established by s 6 of the National Water Commission Act 2004 (Cth) ("the NWC Act" or "the National Water Commission Act"). Its functions implementation of an intergovernmental agreement first entered into on 25 June 2004 and known as the National Water Initiative ("the NWI"). The Funding Agreement recites the provision of funding by the NWC for activities that assist in implementing the NWI and the requirement for the provision of Commonwealth funding that the State be actively implementing the NWI. One of the key objectives of the NWI was environmentally sustainable levels of extraction. return currently overallocated or overused water systems the Section 40 of the NWC Act established "the Australian Water Fund Account" ("the Account"). The Account is a Special Account for the purposes of s 21 of the Financial Management and Accountability Act 1997 (Cth). There is thus a standing appropriation for s 83 of the Constitution, from the Consolidated Revenue Fund established by s 81, for expenditure for the purposes of the Account. Under the NWC Act, the functions of the Chief Executive Officer ("the CEO") of the NWC include (s 24) the administration by debits from the Account of financial assistance awarded by the Minister under s 42 to particular projects relating to Australia's water resources. Crennan Section 42 of the NWC Act states: "The purposes of the Special Account, in relation to which amounts may be debited from the Account, are: to provide financial assistance that is: awarded by the Minister to particular projects relating to Australia's water resources; and determined by the Minister to be provided from the Account; or to pay or discharge the costs, expenses or other obligations incurred by the Commonwealth in the performance of the NWC's functions under this Act or the regulations; or to pay any remuneration or allowances payable to any person under this Act." On 9 June 2005, that is to say before the date of the Funding Agreement, the Prime Minister announced the provision of moneys from the Australian Water Fund as an equal contribution to that of the State with the objective, in accordance with the aims and objectives of the NWI, of achieving sustainable groundwater systems including the LLGS. The Premier of the State previously had nominated for such funding a project including a plan for the LLGS to achieve sustainable levels of groundwater extraction by significantly reducing over a 10 year period the water access entitlements of licence holders. This was consistent with the State's Groundwater Policy, announced in 1997, which recognised the stress placed upon groundwater extraction in some areas, jeopardising the long-term sustainability of supply. The 2008 Order, the Proclamation and the 2008 Regulation On 11 January 2008 the Minister, acting pursuant to s 45(1) of the 2000 Act, made an order ("the 2008 Order" or "the Amendment Order") amending the existing Water Sharing Plan for the LLGS ("the Lower Lachlan Plan"). The Minister did so after written advice by Departmental Minute dated 19 December 2007 to the effect that the amendments were necessary to align the plan with approvals under the Funding Agreement. The phrase in the advice "the joint $130 million" refers to the total amount to be provided by the Commonwealth to the State pursuant to the Funding Agreement. By Proclamation dated 30 January 20082, the provisions of Pt 2 (dealing with access licences) and Pt 3 (dealing with approvals) of Ch 3 of the 2000 Act were applied to the LLGS ("the Proclamation"). A regulation made under the 2000 Act, with a commencement date of 1 February 2008, the Water Management (General) Amendment (Lower Lachlan) Regulation 2008 ("the 2008 Regulation" or "the Amendment Regulation"), established the new water access licence system for the LLGS in place of the bore licences under the 1912 Act. The Proclamation and the 2008 Regulation are so drawn as to assume and depend upon the validity of the 2008 Order. The Lower Lachlan Plan had been made by the Minister by order published 26 February 2003, but its commencement had been deferred on a number of occasions prior to 1 February 2008. An effect of s 45(1) of the 2000 Act was to empower the Minister to make the 2008 Order amending the Lower Lachlan Plan "if satisfied it is in the public interest to do so". The term "in the public interest" is one of broad import. When used in a statute, the term classically imports a discretionary value judgment to be made by reference to undefined factual matters confined only by the subject matter, scope and purpose of the statute in question3. As employed in s 45(1), the term must include, in its application to the circumstances obtaining when the Minister made the 2008 Order, the implementation of the Funding Agreement with respect to the LLGS. At that stage the State had not taken, within the times stipulated in the Funding Agreement, various steps required on its part to secure the federal funding in respect of the LLGS. Notwithstanding that delay, the Commonwealth intends to make payments in respect of the LLGS upon being satisfied of other matters stipulated in the Funding Agreement. These Commonwealth payments will be in the amount of $2.7 million. The plaintiffs' case It is against this background that the plaintiffs submit that from the operation of s 51(xxxi) of the Constitution two conclusions follow. The first is that the executive power of the Commonwealth under s 61 of the Constitution did not extend to its entry into the Funding Agreement. The second is that the NWC Act is invalid insofar as it authorised the CEO to enter into the Funding 2 Expressed to be made pursuant to ss 55A and 88A of the 2000 Act, and to have effect on and from 1 February 2008. 3 O'Sullivan v Farrer (1989) 168 CLR 210 at 216; [1989] HCA 61. Crennan Agreement on behalf of the Commonwealth and to administer the financial assistance pursuant to the Funding Agreement. If either or both of those submissions be accepted, the plaintiffs then submit that, as a consequence, the 2008 Order, and therefore the Proclamation and the 2008 Regulation, are invalid or inoperative. This appears to be on the footing that, given the operation of the Constitution, it was beyond the scope of the power conferred upon the Minister by s 45(1) of the 2000 Act to exercise the power by treating implementation of the Funding Agreement by the State as "in the public interest". The result is said to be that the introduction of the new licensing system, of which the plaintiffs complain, miscarried and they could not be deprived of their bore licences issued under the 1912 Act. The plaintiffs contend that they remain the holders of those licences. In the course of oral argument, the plaintiffs sought to develop a further argument directed to the New South Wales legislation. Section 6 of the 2000 Act provides for the making of a State Water Management Outcomes Plan ("SWMOP") for the development, conservation, management and control of the water resources of the State in furtherance of the objects of the 2000 Act set out in s 3. SWMOP was established by order of the Governor made 18 December 2002. In the structure of the 2000 Act SWMOP sits above management plans, of which the Lower Lachlan Plan is one. The making of SWMOP preceded the making of the Funding Agreement in 2005. The plaintiffs complained that SWMOP was not then revised so as explicitly to refer to the Funding Agreement. This complaint was made for the first time in oral argument. A management plan is required by par (a) of s 16(1) of the 2000 Act to be consistent with SWMOP. SWMOP is designed "to set out the over-arching policy context, targets and strategic outcomes". It did not cease to do so by reason of the subsequent entry by the State into the Funding Agreement. A management plan also is required (by par (e) of s 16(1)) to "be consistent with ... government policy ...". It may be that a New South Wales policy connected with infringement by federal law of s 51(xxxi) would not answer the description of "government policy" in that paragraph of s 16(1). But, even if so, what would follow would be that such a policy was not a mandatory consideration dictated by s 16(1)(e). It would not necessarily follow that such a policy would be an irrelevant consideration in making a management plan. There is no occasion here to pursue the matter, because, as will appear, there is no engagement of s 51(xxxi) in this case. The Commonwealth case The Attorneys-General for Victoria, Queensland, South Australia and Western Australia intervened and presented submissions generally supportive of those of the defendants. The Commonwealth Solicitor-General, who appeared for the first and second defendants, analysed the relevant operation of the NWC Act as follows: (i) the Prime Minister as Minister administering that statute made a decision under s 42(a)(i) to award financial assistance, as indicated by his announcement of 9 June 2005; (ii) the CEO had the function conferred by s 24 of administering that financial assistance and the Funding Agreement was entered into to further that end; (iii) further, s 61 of the Constitution authorised the Commonwealth to enter into the Funding Agreement as a principal; (iv) the legislative power of the Commonwealth under s 96 or s 96 with s 51(xxxvi)4 extends to the grant of financial assistance to a State for the purpose of the State acquiring property on other than just terms; (v) the power of the CEO under s 24 of the NWC Act to administer financial assistance is to be read down, if necessary, to financial assistance which it is within the legislative power of the Commonwealth to provide; (vi) but by reason of (iv), no such occasion for reading down arises. With respect to the executive power to enter the Funding Agreement, the Commonwealth Solicitor-General correctly accepted that if, contrary to his submission (iv) respecting legislative power, s 96 was relevantly qualified by s 51(xxxi), an agreement to facilitate such a grant which could not be authorised by s 96 would not be supported by s 61. In this way, limitations upon legislative power may indicate whether the ends of an agreement are consistent with the 4 This reads: "matters in respect of which this Constitution makes provision until the Parliament otherwise provides". Section 96 states: "During a period of ten years after the establishment of the Commonwealth and thereafter until the Parliament otherwise provides, the Parliament may grant financial assistance to any State on such terms and conditions as the Parliament thinks fit." Crennan Constitution5. The Solicitor-General properly emphasised the reference in the joint reasons in R v Hughes6 to the statement by Mason J7: "It is beyond question that [the executive power] extends to entry into governmental agreements between Commonwealth and State on matters of joint interest, including matters which require for their implementation joint legislative action, so long at any rate as the end to be achieved and the means by which it is to be achieved are consistent with and do not contravene the Constitution." (emphasis added) In further elaboration of his argument respecting the relationship between s 96 and s 51(xxxi), the Solicitor-General emphasised that (a) s 51(xxxi) operates by abstracting the power of compulsory acquisition from the subject of other "coercive" grants of power that, in the absence of s 51(xxxi), would permit compulsory acquisition by force of Commonwealth law, (b) whether read alone or with s 51(xxxvi), s 96 is a "non-coercive" power, and (c) "terms and conditions" within the meaning of s 96 may extend to the exercise of State legislative power in a coercive way, but, being supported by s 96, will be outside the reach of s 51(xxxi). Coercive and non-coercive powers The classification of legislative authority by a dichotomy between coercive and non-coercive powers may have its antecedents in observations made by Dixon CJ in the Second Uniform Tax Case8. After expressing some disquiet at the course of authority indicating that the power conferred by s 96 "is susceptible of a very wide construction in which few if any restrictions can be implied", the Chief Justice continued: "For the restrictions could only be implied from some conception of the purpose for which the particular power was conferred upon the Parliament 5 See Saunders, "Intergovernmental agreements and the executive power", (2005) 16 Public Law Review 294 at 306. (2000) 202 CLR 535 at 554-555 [38] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [2000] HCA 22. 7 R v Duncan; Ex parte Australian Iron and Steel Pty Ltd (1983) 158 CLR 535 at 560; [1983] HCA 29. 8 The State of Victoria v The Commonwealth (1957) 99 CLR 575 at 605; [1957] HCA 54. or from some general constitutional limitations upon the powers of the Parliament which otherwise an exercise of the power given by s 96 might transcend. In the case of what may briefly be described as coercive powers it may not be difficult to perceive that limitations of such a kind must be intended. But in s 96 there is nothing coercive. It is but a power to make grants of money and to impose conditions on the grant, there being no power of course to compel acceptance of the grant and with it the accompanying term or condition." Of that passage, three things may be said. The first concerns the nature of the terms or conditions which accompany a grant. These may, as is the case here with the Funding Agreement, be expressed in terms of an agreement between the polities involved. Such agreements may take many forms, with some but not all of the characteristics of a contract between the executive government and a private party, citizen or corporation, and of a treaty between sovereign powers. Secondly, for many years the incidental power conferred by s 51(xxxix) has been used to create offences to support the making of grants under s 96 and the implementation of intergovernmental agreements9. Thirdly, in P J Magennis Pty Ltd v The Commonwealth10 Latham CJ rejected the proposition that a federal statute giving financial assistance to States was for that reason not a law with respect to the acquisition of property. The Court did not accept the submission for the defendants11 that a law could not be with respect to the acquisition of property unless it (a) directly acquired property by force of its own terms, (b) created a previously non-existing power in some person to acquire property, or (c) came into operation upon the acquisition of property. Latham CJ said12: "All such laws doubtless would be laws with respect to the acquisition of property. But there is nothing in the words of s 51(xxxi) of the Constitution which supplies any warrant for limiting the application of this provision to laws which fall within the classes mentioned." 9 Examples are ss 12 and 13 of the Commonwealth Grants Commission Act 1933 (Cth); and s 8A of the States Grants (Petroleum Products) Act 1965 (Cth), as introduced by the States Grants (Petroleum Products) Amendment Act 1985 (Cth). 10 (1949) 80 CLR 382 at 403; [1949] HCA 66. 11 (1949) 80 CLR 382 at 402. 12 (1949) 80 CLR 382 at 402. Crennan Magennis that To the extent that his submissions were contrary to Magennis, the Commonwealth Solicitor-General contended that case should be re-considered and overruled. The better view, he submitted, is that indicated subsequently in Pye v Renshaw13. There, in rejecting the plaintiff's argument, the Court noted the absence of any allegation that the moneys to fund the impugned acquisitions had not been duly appropriated or that their payment for any reason would be unlawful. The proposition of law, rejected by the Court, was that "an appropriation by the Commonwealth Parliament for the purposes mentioned is unconstitutional". The Court said that proposition could not be supported. It explained why: just or unjust, authorized by "The argument really comes to this. The Commonwealth cannot itself acquire land except upon just terms. A State can resume land on any terms, the Commonwealth is not authorized by s 96 or any other provision of the Constitution to provide money for a State in order that the State may resume land otherwise than on just terms. This is the very argument which was rejected in Victoria v The Commonwealth14: see also South Australia v The Commonwealth15, where Latham CJ said: 'The Commonwealth may properly induce a State to exercise its powers ... by offering a money grant'." (emphasis added) its Parliament. But However, the two earlier authorities referred to in the last sentence do not require rejection of the particular argument respecting s 96 which was in issue in Pye v Renshaw. The unsuccessful submission presented by Mr R G Menzies for Victoria in Victoria v The Commonwealth16 had been that the Federal Aid Roads Act 1926 (Cth) was not supported by s 96 because (i) it attached to the grant conditions which in substance amounted to the exercise of legislative power with respect to road construction, a subject beyond s 51, (ii) the terms and conditions referred to in s 96 must be of a financial character unless they are terms and conditions falling within a head of power in s 51, and (iii) the terms and conditions must be imposed by the Parliament and cannot be fixed by executive 13 (1951) 84 CLR 58 at 83; [1951] HCA 8. 14 (1926) 38 CLR 399; [1926] HCA 48. 15 (1942) 65 CLR 373 at 417; [1942] HCA 14. 16 (1926) 38 CLR 399 at 405. authority. In the second case, the First Uniform Tax Case17, Latham CJ, who later was in the majority in Magennis, took Victoria v The Commonwealth as establishing that by offering a money grant under s 96 the Commonwealth may properly induce a State to exercise its powers with respect to a particular subject (eg road making) or to abstain from exercising its powers with respect to, for example, banking or insurance. Counsel for the present plaintiffs correctly submitted that what was said in Victoria v The Commonwealth and the First Uniform Tax Case did not address "the very argument" which was put in Pye v Renshaw18. This concerned the application to the exercise of the legislative power conferred by s 96 (read with s 51(xxxvi)) of the restriction found in s 51(xxxi). Counsel for the plaintiffs also pointed to the use in the critical passage in Pye v Renshaw set out above of the phrase "in order that" when encapsulating the argument the Court was rejecting. It is significant that from the legislation under consideration in Pye v Renshaw any arrangement or agreement with the Commonwealth had been, as Professor Saunders has said, "decoupled"19 in 1950 upon the repeal of the War Service Land Settlement Agreement Act 1945 (NSW)20. The argument rejected in Pye v Renshaw was that the exercise of the power to grant financial assistance under s 96 would be vitiated if shown to be for the purpose of inducing the State to exercise its powers of acquisition on less than just terms. The concept of improper purpose as a vitiating characteristic was rightly rejected. Section 96 says nothing about purpose. It authorises the making of grants on "such terms and conditions as the Parliament thinks fit". The constraints imposed by constitutional prohibitions or guarantees will be directed to the range of permissible terms and conditions rather than their underlying purpose. That there was some understanding or arrangement reached between the Commonwealth and the State after Magennis later appeared from Gilbert v Western Australia21. There, Dixon CJ, Kitto and Windeyer JJ in the course of 17 (1942) 65 CLR 373 at 417. 18 (1951) 84 CLR 58 at 83. 19 Saunders, "Intergovernmental agreements and the executive power", (2005) 16 Public Law Review 294 at 301. 20 By s 2 of the War Service Land Settlement and Closer Settlement Validation Act 1950 (NSW). 21 (1962) 107 CLR 494 at 505; [1962] HCA 7. Crennan explaining the sequel to Magennis referred to correspondence at the Ministerial level and went on: letter (dated 19th December 1951) "In one the Prime Minister [Mr Menzies], having in mind that the decision in Magennis's Case22 was regarded as having struck down Commonwealth participation in the 1945 Agreement, said: 'The Commonwealth wishes to avoid, for constitutional reasons disclosed by the Magennis Case, any arrangement of a formal character.' ... And 'In all the circumstances we feel strongly that the best legal foundation for future action can be provided by means of a grant of financial assistance pursuant to s 96 of the Constitution supplemented by an informal arrangement (in the form say of an exchange of letters) between governments setting out the conditions to be observed.' This proposal was adopted." The assumption being made was that the terms and conditions attached to a s 96 grant may sufficiently be disclosed in an informal fashion, falling short of an intergovernmental agreement of the kind seen in this case in the Funding Agreement. It is unnecessary to consider whether that reflected a correct understanding of s 96 and of its relation to s 61 of the Constitution. Further, it is significant – as the Victorian Solicitor-General stressed – that, in Pye v Renshaw, Magennis was not said to be overruled and that the reason why the Court found it unnecessary to do so is to be found in the "decoupling" effected by the changes to the legislation in the intervening period. In Pye v Renshaw23 the Court referred to the deletion from all relevant State legislation of all reference to any agreement with the Commonwealth and all reference to any direct or indirect participation of the Commonwealth in any scheme of soldier settlement. In the companion decision upon the Victorian soldier settlement legislation, Tunnock v The State of Victoria24, Williams and Webb JJ, who had been in the majority in Magennis, concluded25 that the Victorian Parliament had not intended the power of acquisition conferred by its statute "to be mere machinery" for carrying out the agreement with the Commonwealth. 22 (1949) 80 CLR 382. 23 (1951) 84 CLR 58 at 79. 24 (1951) 84 CLR 42; [1951] HCA 55. 25 (1951) 84 CLR 42 at 56. Leave to re-open Magennis should be refused because, in particular, the reasoning upon which it was based is sound, all the more so in the light of developments in interpretation of the Constitution since Magennis was decided. Several developments since the decision in Magennis tend to support the view taken by the majority of the relationship between s 51(xxxi) and s 96. First, it is now settled26 that the provisions, referred to above, in s 81 of the Constitution for establishment of the Consolidated Revenue Fund and in s 83 for Parliamentary appropriation, do not confer a substantive spending power and that the power to expend appropriated moneys must be found elsewhere in the Constitution or the laws of the Commonwealth. Secondly, it is settled since Trade Practices Commission v Tooth & Co Ltd27 that s 51(xxxi) is not confined to the acquisition of property by the Commonwealth or its instrumentalities. In particular, Mason J28 said that remarks by Sir Owen Dixon which might be thought to throw doubt on that proposition should not be accepted29. In his dissenting reasons in Magennis, Dixon J had said that "perhaps" s 51(xxxi) applied to acquisition by persons standing in no such position as the Commonwealth, its agencies and instrumentalities30. Thirdly, in Tooth Barwick CJ described s 51(xxxi) as "a very great constitutional safeguard"31 and shortly thereafter, in the joint reasons of six Justices in Clunies-Ross v The Commonwealth32, it was said that s 51(xxxi) "has 26 Pape v Federal Commissioner of Taxation (2009) 238 CLR 1; [2009] HCA 23. 27 (1979) 142 CLR 397 at 403, 407-408, 426, 451-452; [1979] HCA 47. See also Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 197; [1992] HCA 45. 28 (1979) 142 CLR 397 at 426. 29 Mason J referred to Attorney-General (Cth) v Schmidt (1961) 105 CLR 361 at 372-373; [1961] HCA 21; and Andrews v Howell (1941) 65 CLR 255 at 281-282; [1941] HCA 20. 30 (1949) 80 CLR 382 at 411. 31 (1979) 142 CLR 397 at 403. 32 (1984) 155 CLR 193 at 201-202 per Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ; [1984] HCA 65. Subsequent statements to like effect are collected (Footnote continues on next page) Crennan assumed the status of a constitutional guarantee of just terms ... and is to be given the liberal construction appropriate to such a constitutional provision". Fourthly, that construction involves looking beyond matters of legal form and to the practical effect of the law in question33. Indeed, shortly before the decision in Magennis, in Bank of NSW v The Commonwealth34, Dixon J had used the expression "circuitous device" when concluding that the effect of the federal law was that the banks and their shareholders, in a real sense, albeit not formally, were stripped of the possession and control of their entire undertaking, without compliance with s 51(xxxi). Finally, passages in the reasons of several members of the Court in Attorney-General (Vict); Ex rel Black v The Commonwealth35, respecting the relationship between s 96 and the guarantee or prohibition provided by s 116 with respect to matters of religion, suggest that s 96 and s 51(xxxi) also should be read together. Wilson J said that Magennis remained a persuasive analogy respecting s 96 and s 11636. Gibbs J said he considered37: "that ss 96 and 116 should be read together, the result being that the Commonwealth has power to grant financial assistance to any State on such terms and conditions as the Parliament thinks fit, provided that a law passed for that purpose does not contravene s 116." Conclusions respecting s 96 and s 51(xxxi) The result is that the legislative power of the Commonwealth conferred by s 96 and s 51(xxxvi) does not extend to the grant of financial assistance to a State in New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 211 [501]; [2006] HCA 52. 33 See, for example, Tooth (1979) 142 CLR 397 at 433; Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 633-635; [1997] HCA 38; and, as to s 92, Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 464 [47]; [2008] HCA 11. 34 (1948) 76 CLR 1 at 349; [1948] HCA 7. 35 (1981) 146 CLR 559; [1981] HCA 2. 36 (1981) 146 CLR 559 at 650. 37 (1981) 146 CLR 559 at 593; see also at 618 per Mason J. on terms and conditions requiring the State to acquire property on other than just terms. The plaintiffs' case, to that extent, should be accepted. But that is not the end of the matter. It is necessary now to consider whether the replacement of the plaintiffs' bore licences issued under the 1912 Act involved the acquisition of property other than on just terms within the meaning of s 51(xxxi). The plaintiffs placed heavy reliance upon what they said were the rights, recognised at common law in England and applicable to Australian conditions, of an overlying landowner to take and use groundwater. They relied upon English authorities, particularly Chasemore v Richards38, which were referred to in Perth Corporation v Halle39. These rights were said to amount to an interest in land with an existence apart from statute. The statutory intervention by the 1912 Act was but a particular form of regulation in the perceived public interest, and, in any event, the bore licences held by the plaintiffs themselves created rights which were "property" within the meaning of s 51(xxxi). It is convenient first to consider the position at common law both in England and Australia and, in doing so, to detail the development of the statute law, particularly in New South Wales. Water use Water is a finite and fluctuating natural resource. Both within Australia40 and internationally41, the need for sustainable and efficient management of water 38 (1859) 7 HLC 349 [11 ER 140]. 39 (1911) 13 CLR 393 at 398-399, 403-407, 410-411, 413; [1911] HCA 57. 40 See, for example, Agriculture and Resource Management Council of Australia and New Zealand, Standing Committee on Agriculture and Resource Management, Allocation and Use of Groundwater, Occasional Paper 2, December 1996; Gray, "Legal Approaches to the Ownership, Management and Regulation of Water from Riparian Rights to Commodification", (2006) 1(2) Transforming Cultures eJournal 64; Gardner, "The Administrative Framework of Land and Water Management in Australia", (1999) 16 Environmental and Planning Law Journal 212. 41 See, for example, Hardin, "The Tragedy of the Commons", (1968) 162 Science 1243; Blomquist et al, "Institutional and Policy Analysis of River Basin Management: The Murray Darling River Basin, Australia", World Bank Policy Research Working Paper 3527, February 2005; Ostrom, Governing the Commons: (Footnote continues on next page) Crennan resources has attracted a good deal of attention. Questions of the ownership42 and the need for the conservation of water resources43 were serious legal issues in Australia even prior to Federation. The first statutes significantly regulating water resources were passed by New South Wales and Victoria during the 1880s and 1890s44. Since that time, the regulation of water has developed as understanding of the resource has progressed, and the need for irrigation has intensified. The regulation of groundwater extraction in New South Wales, particularly in recent decades, discloses a growing awareness of the need to carefully manage water for agricultural use. Nevertheless, it appears that there is "no single understanding or definition of sustainable yield across Australia"45. The Evolution of Institutions for Collective Action, (1990); Barnes, Property Rights and Natural Resources, (2009). 42 Second Reading Speech, New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 2 July 1896 at 1282, 1283, 1288, 1290, 1292, 1293, 1301-1303 and 1307; New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 8 July 1896 at 1408; Second Reading Speech, New South Wales, Legislative Council, Parliamentary Debates (Hansard), 2 September 1896 at 2798- 2801 and 2806; see also Second Reading Speech of Mr Alfred Deakin, Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 24 June 1886 at 432-433, 436 and 440. 43 Second Reading Speech, New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 2 July 1896 at 1282, 1286-1287, 1291-1292 and 1295; Second Reading Speech, New South Wales, Legislative Council, Parliamentary Debates (Hansard), 2 September 1896 at 2798; New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 10 June 1897 at 1038; Second Reading Speech, New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 11 August 1897 at 2888; see also Second Reading Speech of Mr Alfred Deakin, Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 24 June 1886 at 432-433, 436 and 440. 44 Water Rights Act 1896 (NSW); Artesian Wells Act 1897 (NSW); Irrigation Act 1886 (Vic). 45 Agriculture and Resource Management Council of Australia and New Zealand, Standing Committee on Agriculture and Resource Management, Allocation and Use of Groundwater, Occasional Paper 2, December 1996, par 4.1. The common law Early explorers of the inland geography of Australia discovered "that strange phenomenon of Australia" where even apparently substantial rivers evaporated, especially during drought, "from the intense heat of the plains"46. Partly as a result of water scarcity during recurrent droughts47, access to and use of water in New South Wales has long been regulated by statute. However, it is useful to consider aspects of the common law position before the passing of pre-Federation water legislation, as such statutes were expressly intended to move away from the common law. For example, the Irrigation Act 1886 (Vic) provided: "The right to the use of all water at any time in any river stream watercourse lake lagoon swamp or marsh shall … be vested in the Crown …"48 (emphasis added). The relevant Minister, Mr Alfred Deakin, explained that the provision was designed to overcome perceived difficulties with riparian rights developed in England by the common law49. New South Wales followed suit. The Water Rights Act 1896 (NSW) ("the 1896 Act") provided: "The right to the use and flow and to the control of the water in all rivers and lakes … shall … vest in the Crown."50 Section 6 of the 1912 Act retained this language. Similar language was adopted in water 46 Scott, A Short History of Australia, 7th ed (1947) at 121. 47 As to which see the Second Reading Speech, New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 2 July 1896 at 1295: "There are many persons now living in New South Wales who remember the drought of 1837, 1838, and 1839, and anyone remembering the great drought of 1850-51 must know that it would be much better to conserve water for the purposes of averting such a great calamity, and that it is desirable a fair amount of public money should be spent on works of water conservation." 48 Section 4. 49 Second Reading Speech of Mr Alfred Deakin, Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 24 June 1886 at 440-441. 50 Section 1(I). Crennan legislation in other parts of Australia51. Of significance for this case is that the vesting of rights to the "use" and "control" of water constituted an exercise of sovereignty in the sense that the rights so vested were based on the political power of the State. Accordingly, the reasoning of the Full Court of the Supreme Court of New South Wales in Hanson v The Grassy Gully Gold Mining Co52, that the 1896 Act vested in the Crown the common law rights of riparian owners, is to be preferred to the slightly delphic observation of Fullagar J in Thorpes Ltd v Grant Pastoral Co Pty Ltd53 suggesting that riparian rights survived those vesting provisions. The assertion of control over water was assumed to include the power to issue licences54. The second point of interest is that the language of the 1896 Act and the 1912 Act does not disturb the common law notion that water, like light and air, is common property not especially amenable to private ownership and best vested in a sovereign state55. The common law position in relation to flowing water, which adapted Roman law doctrine56, was settled in Embrey v Owen57. Baron 51 Rights in Water and Water Conservation and Utilization Act 1910 (Q); Rights in Water and Irrigation Act 1914 (WA); Control of Waters Act 1919 (SA); Control of Waters Ordinance 1938 (NT); Lake Burley Griffin Ordinance 1965 (ACT). 52 (1900) 21 NSWR (L) 271. 53 (1955) 92 CLR 317 at 331; [1955] HCA 10. These observations were not followed by Cohen J in Van Son v Forestry Commission of New South Wales (1995) 86 LGERA 108, and the reasoning in Hanson was preferred. 54 See discussion relating to the proposed Water Rights Bill, New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 13 November 1895 at "The bill we propose to introduce will be a very short one. It will deal in the first place with riparian rights. The Government will take power to issue licences in respect of all works which have already been constructed upon proper inquiry being made. We propose in respect of other works to take power to issue a licence for a period of five years, with the right of renewal for a further term if the Minister thinks it advisable in the public interest." 55 Blackstone, Commentaries on the Laws of England, (1766), bk 2, c 1 at 14-15. 56 For a detailed account see Rodger, Owners and Neighbours in Roman Law, (1972) esp at 1-37 and 141-166. 57 (1851) 6 Ex 353 [155 ER 579]. Parke adopted the view of Chancellor Kent58 that flowing water is publici juris in the sense that no-one has "property in the water itself, but a simple usufruct while it passes along"59. This reflected Blackstone's classification of water as a "moveable, wandering thing" which was "common"60 property. As such it is "beyond individual appropriation and alienation"61. Riparian rights did not depend on ownership of the soil of a stream; they attached to land in either lateral or vertical contact with a stream62. This can be contrasted with the common law position in relation to groundwater settled in England in Chasemore v Richards63. Lord Chelmsford distinguished between "water flowing in a definite channel, and water whether above or underground not flowing in a stream at all, but either draining off the surface of the land, or oozing through the underground soil in varying quantities"64. Such water could be intercepted by a landowner. The proposition that water in general cannot form the subject matter of property had the consequence that the grant by a landowner to another of a watercourse did not mean the grant of the water itself65. The grant of "a watercourse" meant, as Sir George Jessel MR explained in Taylor v Corporation of St Helens66, an easement or right to the running of water, or, if there was a relevant context, either the channel, pipe or drain containing the water, or the land over which the water flowed. 58 Commentaries on American Law, (1828), vol 3, Lecture 51 at 353. 59 Embrey v Owen (1851) 6 Ex 353 at 370 [155 ER 579 at 586]. 60 Blackstone, Commentaries on the Laws of England, (1766), bk 2, c 2 at 18. 61 Getzler, A History of Water Rights at Common Law, (2004) at 66. 62 Lyon v Fishmongers' Company (1876) 1 App Cas 662 at 683 per Lord Selborne. 63 (1859) 7 HLC 349 [11 ER 140]. 64 (1859) 7 HLC 349 at 375 [11 ER 140 at 150]. 65 Halsbury's Laws of England, 1st ed, vol 11, title "Easements and Profits a Prendre", par 603. 66 (1877) 6 Ch D 264 at 271. Crennan New South Wales legislation Groundwater In 1895, the need for legislation dealing with artesian bores was linked to the need to conserve water67. The Artesian Wells Act 1897 (NSW) provided for government involvement in sinking bores. The Water and Drainage and Artesian Wells (Amending) Act 1906 (NSW) required that artesian bores not sunk by the Crown be licensed. From 1912 bore licences were governed by Pt 5, Div 3 of the 1912 Act. From 1930, a bore was not to be sunk, enlarged, deepened or altered to increase its flow without a licence68, and by 1955 a licence under the 1912 Act was required for all bores69. Such licences were generally issued without limitation as to time and other conditions, although on occasion licences were issued subject to a variety of conditions. From 1973 to 1984, it was the usual practice to issue licences for new bores for renewable periods of five years and to impose conditions which were set out in those licences. The conditions typically restricted the purpose for which water could be extracted and typically permitted extraction for irrigation of an area of up to 162 hectares on any one property. The conditions also typically did not impose a volumetric restriction. This policy was applied by the Department administering the relevant parts of the 1912 Act ("the Department") or the Water Resources Commission ("the Commission")70. From March 1984, the Department, and later the Ministerial Corporation constituted by s 7 of the Water Administration Act 1986 (NSW) ("the 1986 Act"), concerned to avoid resource exhaustion, adopted a policy of imposing on all 67 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 13 November 1895 at 2600 and 2601. It can be noted that the then Department of Water Conservation had completed some works on the Lower Lachlan. 68 Section 112(1) of the 1912 Act, inserted by Water (Amendment) Act 1930 (NSW). 69 Irrigation, Water and Rivers and Foreshores Improvement (Amendment) Act 1955 (NSW), s 12. 70 First constituted as the Water Conservation and Irrigation Commission under ss 4 and 4A of the Irrigation Act 1912 (NSW) (as amended by s 6 of the Irrigation (Amendment) Act 1916 (NSW)) and reconstituted as the Water Resources Commission (being a continuation of the same legal entity as the Water Conservation and Irrigation Commission) under s 4 and cl 1 of Sched 4 of the Water Resources Commission Act 1976 (NSW). licences, except those used to access domestic and stock requirements, a condition limiting the volume of water that could be extracted in a particular year. The policy outlined a need to modify allocation policies on the basis of continued monitoring of particular groundwater systems. In each case, a condition was imposed on bore licences in the following, or similar, terms: "The [authority/person administering the 1912 Act] shall have the right during the currency of this licence to vary at any time the volumetric allocation, or the rate at which this allocation is taken." From 1981, on top of the volumetric allocation under each licence (known as an "entitlement"), "allocations" specifying the actual amount of water that could be taken out of each entitlement were from time to time notified to licence holders. In 1966, amendments were made to the 1912 Act empowering the entity administering the 1912 Act (later the Ministerial Corporation) to make declarations regarding areas, which would then have implications for the way in which water in those areas could be managed71. Section 117A(3)(a) provides that, in respect of a "restricted sub-surface water area", the Ministerial Corporation may: "by order in writing direct the licensee of any bore, whether sunk or commenced to be sunk before or after the proclamation of the restricted sub-surface water area: to restrict or control the rate of flow or pumping or the manner of extraction of water from the bore, or the quantity of water which may be allowed to flow or be pumped therefrom in any stated period of time or its usage; to take such measures or precautions as may be specified in the order for the protection of the quality and prevention of pollution or contamination of any sub-surface water …; (iii) to furnish the Ministerial Corporation at such intervals as may be specified in the order a report of static water level in the bore from 71 Irrigation, Water, Crown Lands and Hunter Valley Flood Mitigation (Amendment) Act 1966 (NSW), s 4. Crennan a point of measurement predetermined by Corporation and of the quantities of water pumped from the bore; the Ministerial to provide, fit and maintain a metering or measuring device acceptable to the Ministerial Corporation which will adequately and continuously record the quantity of water flowing or pumped from a bore from which water is used, and may, in any such order, set forth such requirements as it deems necessary for proper compliance with a direction contained therein". In 1985, the "sub-surface water basin known as the Lachlan River Basin" was declared to be a "prescribed area" under s 117B(2). Section 117B permits the Ministerial Corporation to fix a charge upon licensees of any bore within the prescribed area. From June 1996, the Ministerial Corporation imposed, in respect of each licence, a fixed charge per megalitre of entitlement, plus a fixed charge for each megalitre used, under s 117B(4) of the 1912 Act. In 1994, all sub-surface water basins in New South Wales were declared to be "restricted sub-surface water areas" under s 117A. Surface water Licences entitling the holder to construct works for the extraction of surface water have been issued in New South Wales since the commencement of the 1912 Act. From 1981, surface water was allocated volumetrically for "Regulated Rivers", including the Lachlan River. Pursuant to s 20W of the 1912 Act, the Governor declared that each surface water licence in respect of a Regulated River was subject to the relevant volumetric water allocations scheme, by orders published in the Gazette. Volumetric allocations were prepared by the Commission, which assessed the total quantity of water likely to be available to be taken from a Regulated River in a given year and the total quantity of water that should be reserved for other uses or future uses, and determined in respect of each surface water licence the maximum quantity of water that could, subject to Pt 2, Div 4B, be taken from the Regulated River that year. These announced allocations were notified to licence holders, and a condition limiting the maximum volume of water that could be extracted in a particular year to the amount so determined was added to each surface water licence when next renewed. Conjunctive use From March 1984 to July 1998, the Department adopted a policy applying where licences in respect of both groundwater and surface water had been issued in respect of the same property. If the announced surface water allocation for the relevant surface water licence was, as at 1 October of a particular year, less than 100 per cent of the surface water licence entitlement, the conditions of the relevant bore licence were to permit extraction of the "Conjunctive Use Amount", being the shortfall between the surface water licence entitlement and the surface water allocation. It should be here noted that it is generally more expensive to pump groundwater to the surface than it is to use surface water. This policy was applied to the plaintiffs' bore licences. The policy was revoked from 23 July 1998. New bore licences would not include a Conjunctive Use Amount, and existing licences would be amended to remove any entitlement to a Conjunctive Use Amount. This policy was implemented in the LLGS, and in respect of the plaintiffs' licences, in or around 2002. Conclusions respecting "replacement" of bore licences The 2000 Act provided for the repeal72 of the 1912 Act and the 1986 Act. The effect of other provisions73 of the 2000 Act was to replace licences under Pt 5 of the 1912 Act, including the bore licences of the plaintiffs, with aquifer access licences under the 2000 Act. This was to be taken to occur on "the appointed day" fixed by proclamation under s 55A of the 2000 Act. This day was 1 February 2008. On the assumption that all other conditions for the engagement of s 51(xxxi) thus were satisfied, can it be said that on 1 February 2008 there was an acquisition of property of the plaintiffs on other than just terms? The answer is that on that date: (i) the plaintiffs had no common law rights with respect to the extraction from the land of groundwater for the purposes of their businesses, (ii) whatever proprietary characteristics the bore licences of the plaintiffs may have had, there was no acquisition of property within the meaning of s 51(xxxi), and (iii) these conclusions make it unnecessary further to consider the conceded insufficiency of the offered structural adjustment payments as just terms. We turn to explain the answer in point (i) and then that in point (ii). 72 Section 401 and Sched 7. 73 Section 403 and Sched 10. Crennan Common law rights The subject of common law rights (point (i)) has been considered earlier in these reasons74, but further reference to statute is necessary. This puts beyond dispute the absence of such rights in the plaintiffs. By additions made in 196675 the 1912 Act vested in what was then the Commission and "for the benefit of the Crown" the right "to the use and flow and to the control of all sub-surface water" (s 4B) and it was made an offence, except in accordance with the 1912 Act or with written permission of the Commission, to "interfere in any way with sub-surface water or obstruct its flow" (s 4C). The vesting effected by s 4B for the benefit of the Crown was apt to divest any common law rights, whether otherwise existing and whether classified as an interest in land, as the plaintiffs would have it. That conclusion is consistent with the reasoning in Hanson v The Grassy Gully Gold Mining Co76 to which reference was made earlier in these reasons77. Section 4B was repealed in 198678. Thereafter the rights to "the use and flow" and "the control" of groundwater vested in the Ministerial Corporation under s 12(1) of the 1986 Act. It will be noted that the language used in s 4B and repeated later is the same as the language used in respect of surface water in the late 19th century as described earlier; it is language consonant with a recognition that water is a common resource79. The character of the bore licences The remaining issues with respect to the possible engagement of s 51(xxxi) concern the constitutional character of the plaintiffs' bore licences and their alleged "acquisition" on 1 February 2008. 75 By the Irrigation, Water, Crown Lands and Hunter Valley Flood Mitigation (Amendment) Act 1966 (NSW). 76 (1900) 21 NSWR (L) 271. 78 Water (Amendment) Act 1986 (NSW), Sched 1(4). 79 Cf Chasemore v Richards (1859) 7 HLC 349 [11 ER 140]. The bore licences operated for the benefit of the lawful occupier for the time being of the land whereon the bores were sunk (s 117). From 15 October 2003, s 117J applied to the area in which the plaintiffs' licences were granted. Section 117J provided for the transfer (permanently or for a period) of the whole or part of the water allocations for a licence, whether or not the transferee held another licence. In New South Wales, the assessment of the value of irrigable land takes into account rights to take water80. Bore licences attached to irrigable land enhanced its market value and were commonly taken into account by lenders when assessing the value of security to be provided. But the approval of the Ministerial Corporation was necessary to any transfer and it might impose such conditions in relation to the transfer as it thought fit (s 117J(11)). It often has been remarked that the facility given by statute for the transfer of rights created by or pursuant to that statute is an indication that for the general purposes of the law the rights may be classified as proprietary in nature. An example is provided by the speech of Lord Wilberforce in National Provincial Bank Ltd v Ainsworth81. But as Mason J, in the course of discussing Ainsworth, observed in R v Toohey; Ex parte Meneling Station Pty Ltd82, where a licensing system is subject to Ministerial or similar control with powers of forfeiture, the licence, although transferable with Ministerial consent, nevertheless may have an insufficient degree of permanence or stability to merit classification as proprietary in nature. The Commonwealth and New South Wales Solicitors-General, in particular, emphasised the presence in the 1912 Act of provisions which rendered the bore licences, it was said, inherently susceptible of variation within the meaning of authorities upon s 51(xxxi) of the Constitution. These include The Commonwealth v WMC Resources Ltd83; Attorney-General (NT) v Chaffey84; Minister for Primary Industry and Energy v Davey85 and Bienke v Minister for Primary Industries and Energy86. 80 Valuation of Land Act 1916 (NSW), s 6A(3). 81 [1965] AC 1175 at 1247-1248. 82 (1982) 158 CLR 327 at 342; [1982] HCA 69. 83 (1998) 194 CLR 1; [1998] HCA 8. 84 (2007) 231 CLR 651; [2007] HCA 34. 85 (1993) 47 FCR 151. 86 (1996) 63 FCR 567. Crennan As examples of the insubstantial character of the bore licences issued under the 1912 Act, reference was made to the subjection of the licences (by s 116D) both to the limitations and conditions of the licence and to the provisions of Pt 5 (ss 105-129), including the power of restriction or suspension during periods of water shortage (s 117E) and the power (s 117H) of cancellation or suspension for failure to comply with the requirements imposed by Pt 5 or with the limitations and conditions of the licence. The plaintiffs referred to the legislative history which we have detailed earlier in these reasons, including policies adopted from time to time in the administration of the legislation. They then countered that it was never an object of the 1912 Act to use its provisions or to impose conditions to reduce permanently the entitlements of licensees or to terminate licences; the object, rather, had been to deal with occasions of scarcity. It is unnecessary to resolve that particular dispute and to determine whether the bore licences were of such an insubstantial character as to be no more than interests defeasible by operation of the legislation which called them into existence. Acquisition of property? This is because, whatever the proprietary character of the bore licences, s 51(xxxi) speaks, not of the "taking"87, deprivation or destruction of "property", but of its acquisition. The definition of the power and its attendant guarantee by reference to the acquisition of property is reflected in a point made by Dixon J in British Medical Association v The Commonwealth88. This is that the wide protection given by s 51(xxxi) to the owner of property nevertheless is not given to "the general commercial and economic position occupied by traders". The scope of the term "acquisition" was explained as follows by Deane and Gaudron JJ in Mutual Pools & Staff Pty Ltd v The Commonwealth89: 87 The term is used in the Fifth Amendment to the United States Constitution and the destruction of property rights may amount to a "taking": Pennsylvania Coal Co v Mahon 260 US 393 (1922). 88 (1949) 79 CLR 201 at 270; [1949] HCA 44. 89 (1994) 179 CLR 155 at 185; [1994] HCA 9. "Nonetheless, the fact remains that s 51(xxxi) is directed to 'acquisition' as distinct from deprivation. The extinguishment, modification or deprivation of rights in relation to property does not of itself constitute an acquisition of property90. For there to be an 'acquisition of property', there must be an obtaining of at least some identifiable benefit or advantage relating to the ownership or use of property. On the other hand, it is possible in which an extinguishment, modification or deprivation of the proprietary rights of one person would involve an acquisition of property by another by reason of some identifiable and measurable countervailing benefit or advantage accruing to that other person as a result91." to envisage circumstances Their Honours went on to give the example of the extinguishment of a chose in action, to the benefit of the obligee92. It is now settled that an action in contract or tort, like any chose in action arising at common law or in equity, is to be classified as "property" for the operation of s 51(xxxi), and that relief of the obligee from what otherwise would be the full measure of liability may be an "acquisition" in the constitutional sense93. However, in the present case, and contrary to the plaintiffs' submissions, the groundwater in the LLGS was not the subject of private rights enjoyed by them. Rather, and as these reasons have sought to demonstrate, it was a natural resource, and the State always had the power to limit the volume of water to be taken from that resource. The State exercised that power from time to time by legislation imposing a prohibition upon access to and use of that natural resource, 90 See British Medical Association v The Commonwealth (1949) 79 CLR 201 at 270-271 per Dixon J; The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 145-146 per Mason J, 181-182 per Murphy J, 247-248 per Brennan J, 283 per Deane J; [1983] HCA 21; Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 528 per Dawson and Toohey JJ; [1993] HCA 10. It is relevant to note that the Privy Council has also, in the context of interpreting the Malaysian Constitution, drawn a distinction between deprivations and acquisitions: Government of Malaysia v Selangor Pilot Association [1978] AC 337 at 347-348. 91 See, generally, The Tasmanian Dam Case (1983) 158 CLR 1 at 283-284. 92 (1994) 179 CLR 155 at 185. 93 Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297; [1994] HCA 6; Smith v ANL Ltd (2000) 204 CLR 493; [2000] HCA 58. Crennan which might be lifted or qualified by compliance with a licensing system. The changes of which the plaintiffs complain implemented the policy of the State respecting the use of a limited natural resource, but that did not constitute an "acquisition" by the State in the sense of s 51(xxxi)94. Nor can it be shown that there has been an acquisition in the necessary sense by other licensees or prospective licensees. They have at best the prospect of increasing or obtaining allocations under the new system applying to the LLGS. The decision in Newcrest Mining (WA) Ltd v The Commonwealth95 does not assist the plaintiffs. To acquire the substance of proprietary interests in the mining tenements considered in that case is one thing, to cancel licences to extract groundwater is another. The mining tenements were interests carved out of the radical title of the Commonwealth to the land in question, and the radical title was augmented by acquisition of the minerals released from the rights of another party to mine them. As Brennan CJ later explained96, the property of the Commonwealth had been enhanced because it was no longer liable to suffer the extraction of minerals from its land in exercise of the rights conferred by the mining tenements held by Newcrest. Nor is assistance respecting "acquisition" provided by Bank of NSW v The Commonwealth97. The Banking Act 1947 (Cth) provided for "nationalisation" not by the direct expedient of simply closing down the businesses of the targeted banks, but by the compulsory acquisition of their businesses through indirect as well as direct means98. There was an acquisition of property, but it was on other than just terms. Remaining issue The plaintiffs contend that (a) if the 2008 Order, the Proclamation and the 2008 Regulation be valid, so that as a matter of State law their bore licences have 94 See Chapman v Luminis Pty Ltd (No 4) (2001) 123 FCR 62 at 264-274; Walden v Administration of Norfolk Island (2007) 212 FLR 345 at 352. 95 (1997) 190 CLR 513. 96 The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 17 [17]; see also Smith v ANL Ltd (2000) 204 CLR 493 at 505 [22]. 97 (1948) 76 CLR 1. 98 Aronson, "The Great Depression, This Depression, and Administrative Law", (2009) 37 Federal Law Review 165 at 188-189. been cancelled and no longer exist, but (b) nevertheless there has been an acquisition of their property otherwise than on just terms within the meaning of s 51(xxxi), then (c) they have an implied right under the Constitution to recover by action against the Commonwealth such amount as would constitute just terms, the contrary of (c), notably Kruger v The and Commonwealth99, should be re-opened. indicating (d) cases The submissions fail at step (b). There has been no such "acquisition". That makes it unnecessary to enter upon the fields of controversy in (c) and (d). Orders The questions in the special case should be answered: By reason of s 51(xxxi) of the Constitution: did the Commonwealth lack executive power to enter into the Funding Agreement? is the National Water Commission Act invalid insofar as it authorised the CEO to enter into the Funding Agreement on behalf of the Commonwealth? The replacement of the plaintiffs' bore licences did not constitute an acquisition of property within the meaning of s 51(xxxi) of the Constitution. Accordingly, the questions of invalidity posed in pars (a) and (b) of Question 1 do not arise. Answer: If the answer to either part of Question 1 is "yes", are all or any of: the Amendment Regulation; the Proclamation; the Amendment Order; invalid or inoperative as a consequence? Answer: Does not arise. 99 (1997) 190 CLR 1; [1997] HCA 27. Crennan Do the plaintiffs remain the holders of all or any of the bore licences issued to them under the Water Act? Answer: If the answers to Questions 2 and 3 are "no", do the plaintiffs have an implied right under the Constitution to recover from the Commonwealth such compensation for the loss of their bore licences as would constitute "just terms" within the meaning of s 51(xxxi) of the Constitution? Answer: Does not arise. Who should pay the costs of this Special Case? Answer: The plaintiffs. HAYNE, KIEFEL AND BELL JJ. In Australia, water and rights to use water are of critical importance, not just to those who are immediately interested in particular water rights, but to society as a whole. Governments have wrestled with the problems presented by Australia's limited water resources since well before federation. The determinative issue in this case is constitutional. That issue neither requires nor permits consideration of any of the large and difficult policy questions that may lie behind the legislative and executive acts which give rise to this proceeding. The three plaintiffs conduct farming enterprises near Hillston in New South Wales. Each plaintiff is a registered proprietor of an estate in fee simple of at least a part of the land on which it conducts its enterprise. The land is near the Lachlan River and within the area of what is called the Lower Lachlan Groundwater System. This litigation, in the original jurisdiction of this Court, concerns the use that the plaintiffs may make of water in the Lower Lachlan Groundwater System. The parties have joined in a Special Case stating questions for the opinion of the Full Court. Until 1 February 2008 the plaintiffs had a number of "bore licences" issued under the Water Act 1912 (NSW) ("the 1912 Act"). Those licences permitted the holder to use a bore to extract water from the ground. The plaintiffs used the groundwater to irrigate their properties. The plaintiffs also had licences to take water from the Lachlan River, and this surface water was also used in irrigation. Because it is usually cheaper to use surface water rather than groundwater, surface water was generally used in preference to groundwater extracted under the bore licences. The amount of groundwater the plaintiffs have used in the past has varied from year to year. The licences that permitted the plaintiffs to take surface water are not in issue in this case. On 1 February 2008, the bore licences held by the plaintiffs were replaced100 by new licences, called aquifer access licences, issued under the Water Management Act 2000 (NSW). The new aquifer access licences permitted the plaintiffs to take less water than the bore licences had allowed. The plaintiffs' central complaint in this litigation is that their entitlement to water was thus reduced, without any legal right to compensation, and that therefore there has been an acquisition of their property otherwise than on just terms, contrary to s 51(xxxi) of the Constitution. 100 Water Management Act 2000 (NSW), Sched 10, item 3. The factual and legal steps to which the plaintiffs pointed as engaging the arguments about acquisition otherwise than on just terms can be described as follows. First, in June 2004 the governments of the Commonwealth, New South Wales, Victoria, Queensland, South Australia, the Australian Capital Territory and the Northern Territory made an "Intergovernmental Agreement on a National Water Initiative"101. It is convenient to call this agreement "the NWI". As contemplated by the NWI, federal legislation (the National Water Commission Act 2004 (Cth) – "the NWC Act") was passed which established the National Water Commission ("the NWC") "as an independent statutory body"102. One of the "general functions" of the NWC was103 "to assist with the implementation of the NWI, and to undertake activities that promote the objectives and outcomes of the NWI". The NWC Act contemplated the awarding, by the Minister administering the Act, of "financial assistance ... to particular projects relating to Australia's water resources"104 and provided that the Chief Executive Officer of the NWC had the function of administering that financial assistance. The second set of factual and legal steps to which the plaintiffs pointed concerned the award of financial assistance to a particular project proposed by New South Wales with respect to the Lower Lachlan Groundwater System. The State's proposal having been accepted by the relevant federal Minister (then the Prime Minister) a Funding Agreement was made on 4 November 2005. The parties to the Funding Agreement were described as the "Commonwealth of Australia, as represented by and acting through the National Water Commission" and the "State of New South Wales, as represented by and acting through the Department of Natural Resources". Many of the clauses of the Funding Agreement were cast in terms that would be apt to a contract made between commercial entities. So, for example, there was an express choice of law clause and a non-exclusive submission to the jurisdiction of the courts of New South Wales. The way in which the Funding Agreement was drafted provoked 101 Tasmania and Western Australia joined the NWI subsequently. 102 Section 3 of the National Water Commission Act 2004 (Cth) ("the NWC Act") provided: "The object of this Act is to establish the National Water Commission, as an independent statutory body, as required by the National Water Initiative." 103 NWC Act, s 7(1)(a). 104 s 24(1)(a). argument about whether, and to what extent, it was capable of enforcement as a contract. Those debates need not be decided. that "[s]ubject The Funding Agreement provided to sufficient appropriations for the Programme and the State's compliance with this Agreement, the Commonwealth will provide the State with the Funding at the times, on the conditions and in the manner specified" in a schedule to the Agreement. The maximum amount to be provided by the Commonwealth under the Agreement was $55 million. Subject to the State meeting certain "Milestones", most of the money to be provided by the Commonwealth was to be paid by 1 July 2006. The State was to contribute $55 million to the project. By the Funding Agreement the State agreed to carry out "the Project". So far as immediately relevant, it is enough to notice that "the Project" required the State (a) to convert all water licences in the Lower Lachlan Groundwater System to licences under the Water Management Act 2000; (b) to develop a method for reducing water entitlements to the Groundwater System that took into account a licence holder's historical extraction of water from the relevant system; and (c) once that method had been agreed by the Prime Minister and the Premier of New South Wales, to achieve a reduction of 56 per cent in water entitlements in respect of the Lower Lachlan Groundwater System by 1 July 2016. The Funding Agreement provided for making ex gratia "structural adjustment payments" to affected licence holders but that each payment was not to exceed two-thirds of the final value of a licence holder's water entitlement reduction at the end of the 10 year period over which the reduction was to occur. The budget for structural the adjustment payments was $100 million (half Commonwealth and half by the State). No party or intervener submitted that, if there was an acquisition of property, the making of these ex gratia structural adjustment payments would constitute the provision of just terms. to be provided by The third set of factual and legal steps concerned the processes by which, as contemplated by the Funding Agreement, the State sought to convert water licences in the Lower Lachlan Groundwater System from licences under the 1912 Act to licences under the Water Management Act 2000, and the processes by which the State reduced water entitlements. Particular attention was directed to three State instruments that converted water licences under the 1912 Act and effected the reduction in entitlements: the Water Sharing Plan for the Lower Lachlan Groundwater Source Amendment Order 2008; the Water Management (General) Amendment (Lower Lachlan) Regulation 2008 (NSW); and a Proclamation dated 30 January 2008 stated to be made pursuant to ss 55A(1) and 88A(1) of the Water Management Act 2000. It is convenient to adopt the terms used in the Special Case and to refer to these three instruments as the Amendment Order, the Amendment Regulation and the Proclamation. In their Special Case, the parties identified "the questions of law arising in the proceeding"105 in the following terms: By reason of s 51(xxxi) of the Constitution: did the Commonwealth lack executive power to enter into the Funding Agreement? is the National Water Commission Act invalid insofar as it authorised the CEO to enter into the Funding Agreement on behalf of the Commonwealth? If the answer to either part of Question 1 is 'yes', are all or any of: the Amendment Regulation; the Proclamation; the Amendment Order; invalid or inoperative as a consequence? Do the plaintiffs remain the holders of all or any of the bore licences issued to them under the Water Act? If the answers to Questions 2 and 3 are 'no', do the plaintiffs have an implied right under the Constitution to recover from the Commonwealth such compensation for the loss of their bore licences as would constitute 'just terms' within the meaning of s 51(xxxi) of the Constitution? 5. Who should pay the costs of this Special Case?" Questions 1–3: An invalid acquisition of property? It is convenient to deal with the first three questions together. The general framework of the plaintiffs' arguments in relation to them can be identified as having four elements: The plaintiffs' water entitlements under the bore licences are no more than a regulation of the common law rights of the plaintiffs, as landowners, to 105 High Court Rules 2004, r 27.08.1. take and use groundwater; they are rights of a proprietary kind with which s 51(xxxi) deals. (b) Neither the NWC Act nor the Funding Agreement is valid to the extent to which either the Act or the Agreement provides for, or contemplates, the acquisition of the plaintiffs' property otherwise than on just terms. And any law by which the Consolidated Revenue Fund is appropriated for the Commonwealth to make payments under the Funding Agreement is likewise invalid. Steps taken by the State in furtherance of the Funding Agreement (by the Amendment Order, the Amendment Regulation and the Proclamation) are steps taken in breach of the Constitution and the guarantee in s 51(xxxi), whether by application of covering cl 5106 or s 106107 of the Constitution, and for that reason are invalid. The steps taken by the State to convert the plaintiffs' bore licences to aquifer access licences being thus invalid, the plaintiffs retain their existing bore licences. Each of those four elements of the plaintiffs' arguments necessarily depended upon a number of premises, some constitutional, some not. So, for example, the propositions that the NWC Act does not provide, or does not validly provide, for an acquisition of property otherwise than on just terms depended upon premises about the construction of the NWC Act, and about the head or heads of legislative power that supported the NWC Act in one or more of its operations. Most importantly, the propositions about the NWC Act depended upon the premise that s 51(xxxi) was engaged in a relevant respect. The engagement of s 51(xxxi) was said to proceed by four steps. First, the NWC Act is otherwise a valid law of the Commonwealth. Second, the NWC Act permits or requires the fixing of terms and conditions upon which a grant of financial assistance to a State is to be made under s 96 of the Constitution. Third, the 106 "This Act, and all laws made by the Parliament of the Commonwealth under the Constitution, shall be binding on the courts, judges, and people of every State and of every part of the Commonwealth, notwithstanding anything in the laws of any State ...". 107 "The Constitution of each State of the Commonwealth shall, subject to this Constitution, continue as at the establishment of the Commonwealth, or as at the admission or establishment of the State, as the case may be, until altered in accordance with the Constitution of the State." power given by s 96 to the Parliament to "grant financial assistance to any State on such terms and conditions as the Parliament thinks fit" does not extend to fixing, directly or indirectly, as a term or condition of a grant, a requirement that a State acquire property otherwise than on just terms. Fourth, because the Funding Agreement provided for an acquisition of the plaintiffs' property otherwise than on just terms, the making of the Funding Agreement by the Commonwealth was not authorised by the NWC Act (or otherwise) and the Funding Agreement was invalid. The submissions about the intersection of ss 96 and 51(xxxi) directed particular attention to this Court's earlier decisions in P J Magennis Pty Ltd v The Commonwealth108 and Pye v Renshaw109. The plaintiffs submitted that Magennis was directly in point because, so they submitted, the object of the Funding Agreement was, and its terms required, that there be an acquisition of property otherwise than on just terms and Magennis holds that a law which authorises the making of an agreement in those terms is invalid. By contrast, the first and second defendants (the Commonwealth and the NWC) sought leave to reopen Magennis and submitted that it should be overruled. The third and fourth defendants (New South Wales and the Minister Administering the Water Management Act 2000) and Victoria and Queensland intervening submitted that it was not necessary to decide whether Magennis was correct but that, if the Court were to consider the matter, the Court should overrule the decision. Western Australia and South Australia intervening submitted that Magennis should be distinguished. The plaintiffs' submission that the Funding Agreement was invalid (sometimes advanced as an argument that it was not "enforceable") was a necessary premise for the next step in their argument: that the Amendment Order, the Amendment Regulation and the Proclamation are invalid. The three instruments were connected. It was not disputed that if, as the plaintiffs submitted, the Amendment Order was invalid, the Amendment Regulation and the Proclamation had no operation because each depended upon there first having been a valid Amendment Order. As noted earlier, questions about whether, or to what extent, the Funding Agreement could be enforced as a contract need not be considered. It is enough to observe that invalidity of the three State instruments was said to follow from the application of either covering cl 5 or s 106 (and its reference to the 108 (1949) 80 CLR 382; [1949] HCA 66. 109 (1951) 84 CLR 58; [1951] HCA 8. Constitution of each State continuing "subject to this Constitution"). Nor will it be necessary to examine the plaintiffs' further submission that the Amendment Order was made by the relevant New South Wales Minister on the basis of an error of law (that the Funding Agreement was valid) and that its making was capricious and unreasonable. Just as some of the more particular arguments advanced by the plaintiffs need not be considered, the accuracy of many of the premises that lie behind the four main elements of the plaintiffs' arguments need not be examined or decided in this matter. All of the arguments advanced by the plaintiffs depended upon the validity of one central proposition: that there had been an acquisition of property. That is, the central proposition in the plaintiffs' arguments was that the replacement of bore licences issued under the 1912 Act by aquifer access licences issued under the Water Management Act 2000 (permitting extraction of less water than had been allowed under the bore licences) worked an acquisition of property. These reasons will demonstrate that this central proposition should not be accepted. Since 1906, it has not been lawful to bore for, and thus obtain access to, groundwater in New South Wales without a licence to do so110. Since 1930, the quantity of groundwater that may be taken could be fixed as a condition of being licensed to dig or to use a bore111. Since 1966, groundwater has been 110 Water and Drainage and Artesian Wells (Amending) Act 1906 (NSW), s 22(1), which provided, so far as now relevant, that: "No artesian well shall be commenced or be enlarged, deepened, or be altered to increase the flow of water therefrom, unless – (a) in pursuance of a licence under this Act ...". Section 22 was to be construed with the Artesian Wells Act 1897 (NSW) which defined (s 7) "Artesian Well" as including "an artesian well from which the water does not flow naturally, but has to be raised by pumping or other artificial means". 111 The Water (Amendment) Act 1930 (NSW) ("the 1930 Amendment Act") amended the Water Act 1912 (NSW) ("the 1912 Act") by repealing and re-enacting ss 115 and 116 of the 1912 Act. The new sections provided that any licence granted with respect to the sinking of what thereafter were referred to as "bores" should be subject to such limitations and conditions as the licensing authority may think fit to make. vested in the State112. And since that date, the amount of water that could be taken under a bore licence, and the rate at which it could be taken, could be restricted or controlled113. This being the legal regime that governed groundwater in New South Wales, replacement of the bore licences under the 1912 Act by new aquifer access licences permitting extraction of less water was not an acquisition of property. In order to explain why, it is necessary to say something further about the English common law concerning water, and on that foundation to examine the plaintiffs' submission that the relevant legislation was no more than a regulation of the common law rights of the plaintiffs as landowners. English common law rights to water By the middle of the 19th century, the English common law had settled many of the issues about rights to the use of water that had emerged during the industrial revolution. Common law riparian doctrine regarding natural surface streams was settled in Embrey v Owen114 after full consideration of not only earlier English decisions but also Roman, American and French law. Embrey v Owen held that a riparian owner could make reasonable use of the water in a stream and that what was reasonable depended upon whether the natural flow of 112 The Irrigation, Water, Crown Lands and Hunter Valley Flood Mitigation (Amendment) Act 1966 (NSW) ("the 1966 Amendment Act") amended the 1912 Act to insert a new s 4B providing in sub-s (1) that: "The right to the use and flow and to the control of all sub-surface water shall vest in the Commission for the benefit of the Crown and in the exercise of that right the Commission, by its officers, servants and agents, may enter any land and take such measures as may be thought fit or as may be prescribed for the conservation and supply of such water, its more equal distribution and beneficial use, its protection from pollution and for preventing, removing or rendering ineffective any unlawful interference with or obstruction to such flow." 113 The 1966 Amendment Act amended the 1912 Act to provide for declaration of restricted sub-surface water areas (s 117A(1)) and for the Commission, by notice, to direct the licensee of any bore in a restricted sub-surface water area "to restrict or control the rate of flow or pumping or the manner of extraction of water from the bore, or the quantity of water which may be allowed to flow or be pumped therefrom in any stated period of time or its usage" (s 117A(3)(a)(i)). 114 (1851) 6 Ex 353 [155 ER 579]. See also Dickinson v The Grand Junction Canal Company (1852) 7 Ex 282 [155 ER 953]. the stream was diminished115. The underlying proposition which informed these principles was that water, like light and air, is common property ("for the common benefit of man"116). Although the right to have the stream flow in its natural state without diminution or alteration was held117 to be an incident in the property in the land through which the stream flows, flowing water was held118 to "publici juris, not in the sense that it is a bonum vacans, to which the first occupant may acquire an exclusive right, but that it is public and common in this sense only, that all may reasonably use it who have a right of access to it, that none can have any property in the water itself, except in the particular portion which he may choose to abstract from the stream and take into his possession, and that during the time of his possession only". (emphasis added) After the decision in Embrey v Owen had more or less settled riparian rights in English common law, there remained uncertainty about rights to groundwater, rights to surface waters forming no channel, and the extent to which water rights, as a species of property incidental to land ownership, could be assigned to persons having no riparian land or privity of estate119. In 1859, in Chasemore v Richards120, the House of Lords settled the common law with respect to groundwater. The House of Lords held121 that the principles established with respect to flowing waters or streams were inapplicable to water percolating through underground strata and not forming a "known subterranean channel". Water of the latter kind "has no certain course, no defined limits, but 115 The significance of diminution of flow was further considered by the Privy Council in Miner v Gilmour (1858) 12 Moo PC 131 [14 ER 861]. There it was held that use could be made for domestic purposes or watering stock, regardless of effect on flow: (1858) 12 Moo PC 131 at 156 [14 ER 861 at 870]. 116 (1851) 6 Ex 353 at 372 [155 ER 579 at 587]. 117 (1851) 6 Ex 353 at 369, 372 [155 ER 579 at 585, 587]. 118 (1851) 6 Ex 353 at 369 [155 ER 579 at 585]. 119 Getzler, A History of Water Rights at Common Law, (2004) at 296. 120 (1859) 7 HLC 349 [11 ER 140]. 121 (1859) 7 HLC 349 at 374-377 [11 ER 140 at 150-151]. ... oozes through the soil in every direction in which the rain penetrates"122. As Lord Chelmsford continued123: "There is no difficulty in determining the rights of the different proprietors to the usufruct of the water in a running stream. Whether it has been increased by floods or diminished by drought, it flows on in the same ascertained course, and the use which every owner may claim is only of the water which has entered into and become a part of the stream. But the right to percolating underground water is necessarily of a very uncertain description. When does this right commence? Before or after the rain has found its way to the ground? If the owner of land through which the water filters cannot intercept it in its progress, can he prevent its descending to the earth at all, by catching it in tanks or cisterns? And how far will the right to this water supply extend?" No limit was placed upon the use that a proprietor could make of groundwater124. As the editors of the relevant volume of the first edition of Halsbury's Laws of England put the matter125, in 1914, "The owner of land containing underground water which percolates or flows by unknown channels to a neighbour's land may divert or appropriate it as he pleases, so that his neighbour may have no underground water in his land, or so that the stream that he owns may be diminished in consequence of the underground water which has been so appropriated not coming into his stream. This right of diversion, or appropriation, may be exercised whatever the motive may be, and it matters not how long his neighbour has enjoyed the use of the percolating water, for the neighbour thereby acquires no rights in law, because water in an unknown channel or percolating water cannot be the subject of prescription or grant. Consequently any person may by drainage or other works on his own land drain his neighbour's well, for this is a case of damnum absque injuria." (emphasis added) 122 (1859) 7 HLC 349 at 374 [11 ER 140 at 150]. 123 (1859) 7 HLC 349 at 374-375 [11 ER 140 at 150]. 124 (1859) 7 HLC 349 at 374-379 [11 ER 140 at 150-152]. 125 vol 28 at 430-431, par 860 (footnotes omitted). The settlement in the 19th century of these common law rules about riparian rights and use of groundwater must not be permitted to obscure some important underlying ideas that find reflection in the rules that were established. First and foremost there was then, and still must be, a clear recognition of the difficulty of applying notions of ownership or property to water in the ground or in a flowing stream. What exactly would be the subject of property rights? While still allowed to flow, no part of the water that flows in a stream can be isolated and tagged as the water "owned" by some person. And water in the ground may move more slowly but there is no less difficulty in identifying what would be the subject of the proprietary rights. As Getzler has rightly said in his work A History of Water Rights at Common Law126, "flowing water is a thing in constant state of change which may be diverted, abstracted, or polluted by competing users, and hence destroyed". It is this "quality of instability" that Getzler identifies127 as creating difficulties of legal characterisation because "underlying the law's intricate structure of property rights corporeal and incorporeal, of tenures, estates, and trusts, lay an abiding principle of physical possession (or rights to the fruits of possession) as the foundation of right". Next, even if these difficulties of identifying the object in respect of which proprietary rights were to exist could be overcome, should any private proprietary right be recognised? In Embrey v Owen128, Parke B spoke of water flowing in a stream (like air and light) as "bestowed by Providence for the common benefit of man" (emphasis added). And James Kent in his Commentaries on American Law (quoted at length in Embrey v Owen) made the same point when he said that129: "Streams of water are intended for the use and comfort of man". It was upon this footing that he formulated130 the principle (taken up and applied in Embrey v Owen) that a person, by or over whose land a stream passes, must use the water "in a reasonable manner, and so as not to destroy, or render useless, or materially diminish, or affect the application of the water by the proprietors below on the stream". 127 at 43 (footnote omitted). 128 (1851) 6 Ex 353 at 372 [155 ER 579 at 587]. 129 (1828), vol 3, Lecture 51 at 354. 130 (1828), vol 3, Lecture 51 at 354. Further, the law that was stated in Chasemore v Richards with respect to groundwater must be understood having regard to two matters. First, little was then known about groundwater resources beyond the fact that water could sometimes be recovered by digging for it. Hence the references in Chasemore v Richards to water which "has no certain course, no defined limits". Secondly, the actual decision in Chasemore v Richards anticipated what was later decided in Allen v Flood131: that an act lawful in itself is not converted by a malicious or bad motive into an unlawful act so as to make the doer of the act liable to civil action. A landowner who dug a well lawfully, and took water from it lawfully, was not liable to another simply because the other suffered some damage, or even if the taker of the water acted to harm the other132. Finally, it is of the very first importance to recognise that the common law principles established in the 19th century were directed to the adjustment of rights between landowners. The issue in this case arises, not because there has been some adjustment of those rights, but because the polity has sought to regulate generally the access allowed to a common resource. Water regulation in Australia The plaintiffs' submission, that the legislation which provided for the creation of the "property" which they alleged had been acquired otherwise than on just terms (the bore licences or that part of their water entitlements which was not carried through into the new aquifer access licences) was no more than the regulation of common law rights, assumes that the content of those common law rights was or is settled. The controversy reflected in this Court's decision in Thorpes Ltd v Grant Pastoral Co Pty Ltd133 about the correctness of the decision in the Supreme Court of New South Wales in Hanson v The Grassy Gully Gold Mining Co134 may deny that premise. And whether or not the content of those common law rights was settled by the end of the 19th century, or even the middle of the 20th century, there would seem to be much force in the view that Hanson's Case was rightly decided when it held135 that common law riparian rights were abolished in New South Wales by the Water Rights Act 1896 (NSW). 132 Acton v Blundell (1843) 12 M & W 324 [152 ER 1223]. 133 (1955) 92 CLR 317; [1955] HCA 10. 134 (1900) 21 LR (NSW) 271. 135 (1900) 21 LR (NSW) 271 at 275-277. Be this as it may, the plaintiffs' submission that the bore licences were no more than a regulation of common law rights does not withstand close attention to and consideration of the course of legislative regulation of the extraction and use of groundwater in New South Wales. To explain why that is so it is desirable to look at some aspects of the history of water regulation in the Australian colonies. During the last quarter of the 19th century, the Australian colonial legislatures gave close attention to regulating water resources. At first the focus fell upon domestic water supply, especially in and near country towns136. But during and after the New South Wales Royal Commission on the Conservation of Water (whose first report was delivered in 1885) and the Victorian Royal Commission on Water Supply (of which Alfred Deakin was chairman and which delivered successive reports between 1885 and 1887) interest turned to irrigation. Irrigation was seen as necessary to future development. An important issue to be resolved was whether riparian rights attached to land. In his speech in the Victorian legislature, in support of the Bill for what was to become the Irrigation Act 1886 (Vic), Mr Deakin noted137 that in both South Australia and New South Wales proposals had been made for the abolition of riparian rights and that the Bill then before the Victorian Parliament sought to declare the law in regard to riparian rights in that colony. In South Australia, the proposal was to permit proclamation of an order bringing surface water under the exclusive control and management of the colony's Water Commission. In New South Wales, that colony's Water Commission proposed that landowners have rights to only so much water as was needed for domestic use or the watering of stock but that otherwise surface water belong to the Crown. The proposal in Victoria, to which s 4 of the Irrigation Act 1886 gave effect, was to deem surface water to be vested in the Crown ("until the contrary be proved by establishing any other right than that of the Crown to the use of such water") and to limit riparian rights to use for domestic and stock supply. Legislation vesting surface water in the Crown was enacted in New South Wales in 1896138. Section 1(I) of the Water Rights Act 1896 provided that: 136 See, for example, Water Conservation Act 1881 (Vic). 137 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 24 June 1886 at 138 Water Rights Act 1896 (NSW). "The right to the use and flow and to the control of the water in all rivers and lakes which flow through or past or are situate within the land of two or more occupiers, and of the water contained in or conserved by any works to which this Act extends, shall, subject only to the restrictions hereinafter mentioned, vest in the Crown." Riparian proprietors were given139 the right to use water for domestic purposes, for watering stock, or for gardens not exceeding five acres used in connection with a dwelling house. Some attention was given to recovery of groundwater for irrigation in both the New South Wales and Victorian Royal Commissions on water supply, but the chief focus fell upon use and conservation of surface water. From the 1870s, bores were dug and groundwater extracted in various parts of Australia, particularly for use in pastoral production140. By 1897, the New South Wales Minister introducing the Artesian Wells Bill 1897 (NSW) could record that about 150 artesian bores had been sunk in New South Wales and 372 in Queensland141. Some bores had been sunk by government, some privately. The evident purpose of the Artesian Wells Act 1897 (NSW) was to encourage recovery of groundwater. But the encouragement given was not for individual landholders to recover water for the landholder's private purposes. What was encouraged was drilling for water that would be used by all landholders in the area. Thus, the Artesian Wells Act 1897 provided (in effect) that on the petition of owners, occupiers or mortgagees of land in an area, and approval of the proposal, the Crown could construct, at public expense, an artesian well and such channels and other works as were necessary to supply water to the petitioners' lands. Charges would then be assessed and levied against occupiers but were not to exceed142 "the yearly value to each occupier of the direct benefit accruing to his land from the construction of the well, and from the supply to the said land of water from the well". 140 Tyrrell, True Gardens of the Gods: Californian-Australian Environmental Reform, 141 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 11 August 1897 at 2873-2874. 142 s 2(II). In 1906, the construction of new bores and the enlargement of existing bores in New South Wales was prohibited unless licensed143. Provision was made144 to permit the Minister to give directions that would prevent wasteful or improper use of water from artesian wells. Although, as noted earlier, legislation vesting groundwater in the State was not enacted in New South Wales until 1966, the 1906 provisions (re-enacted in the 1912 Act145) sufficed to give control over the extraction of groundwater to the State. Subject to any qualification that might then have been necessary in relation to any existing private bores, from 1906 a landowner or occupier in New South Wales had no right to recover groundwater under land owned or occupied by that person without a licence. If a licence was issued, it was deemed146 to be held by and operate for the benefit of the lawful occupier for the time being of the land on which the well was sunk or to be sunk. But the bare fact of ownership or occupation of land gave no right to sink a bore or well. And without a bore or well, there could be no recovery of groundwater. Later steps to alter the regulation of recovery of groundwater may be noticed only briefly. In 1930, the 1912 Act was amended147 to provide for the issue of what thereafter were to be known as "bore licences" permitting the sinking, enlarging, deepening or alteration of bores. After the 1930 amendments, subject to certain provisions of the 1912 Act as then in force, and subject to such limitations and conditions as the licensing authority may think fit to make, bore licences issued for a term were to be renewed by the authority on the application of the holder and payment of the prescribed fee148. To that extent the licences acquired a degree of permanence. From 1955149 all bores, whenever sunk, had to be licensed. 143 Water and Drainage and Artesian Wells (Amending) Act 1906, s 22(1). 146 Water and Drainage and Artesian Wells (Amending) Act 1906, s 28; re-enacted in the 1912 Act, s 117. 147 1930 Amendment Act, s 4. 148 1912 Act, s 116, as inserted by the 1930 Amendment Act, s 4(l). 149 Irrigation, Water and Rivers and Foreshores Improvement (Amendment) Act 1955 (NSW), s 12(f) inserting s 115A in the 1912 Act. Bore licences, though renewable and operating for the benefit of the occupier of the land for the time being, could be and were altered by subsequent legislation. The most notable of those changes was made in 1966, by the Act which vested the right to use and flow and to control of all sub-surface water in the Water Commission for the benefit of the Crown150. The 1966 Act amended the 1912 Act to permit151 the Governor, by proclamation, to "declare any sub-surface water basin, or any part thereof, to be a restricted sub-surface water area". "Sub-surface water" was defined152 as "water occurring naturally under the surface of the ground whatever may be the geological structure in which it is standing or moving". If the area was declared to be a restricted sub-surface water area, the Commission could direct153 the licensee of any bore "to restrict or control the rate of flow or pumping or the manner of extraction of water from the bore, or the quantity of water which may be allowed to flow or be pumped therefrom in any stated period of time or its usage". The Special Case in this matter records that in March 1984 the relevant New South Wales department adopted a policy of imposing on all bore licences, other than those used for domestic and stock requirements, a condition limiting the amount of water that could be extracted in a particular year. In addition, when a condition limiting the amount of water extracted was imposed, a further condition was fixed, which permitted the authority administering the 1912 Act to vary at any time the amount of water that was allocated, or the rate at which the allocation was to be taken. The amounts of water allocated to the plaintiffs as amounts that could be extracted under their bore licences thereafter varied from time to time. In 1984, an area which included the Lower Lachlan Groundwater System was declared to be a restricted sub-surface water area. In 1994, all sub-surface water basins in New South Wales were declared to be restricted sub-surface water areas. In 1997, the New South Wales Government published "The NSW State Groundwater Policy Framework Document", together with what were called its "Component Policies". The objectives of the policy included to "slow and halt, or reverse any degradation of groundwater resources" and to "ensure long term 150 1966 Amendment Act. 151 1912 Act, s 117A(1) inserted by s 4(b) of the 1966 Amendment Act. 152 1912 Act, s 105 inserted by s 4(a) of the 1966 Amendment Act. 153 1912 Act, s 117A(3)(a)(i) inserted by s 4(b) of the 1966 Amendment Act. sustainability of the systems' ecological support characteristics". The document recorded that the policy objectives would be achieved through application of resource management principles including the principle that "[n]on-sustainable resource uses should be phased out". To that end, it was said that a "Quantity Management Policy" would be developed to provide "a set of objectives relating to the sustainable management of groundwater extractions and their impact on dependent ecosystems" and to establish "the basis for sharing the State's groundwater resources". In 1997, the 1912 Act was amended154 to permit restriction or suspension of rights held under licences during periods of water shortage. In 1998 and 1999, the whole of the Lower Lachlan Groundwater System was declared to be a "water shortage zone". Thereafter, no application for new bore licences creating additional entitlements to water were accepted. The 1997 amendments also provided155 for the transfer of water allocations in such sub-surface water basins (or parts of basins) as the relevant authority determined. The Lower Lachlan groundwater management zone was determined to be an area subject to the relevant provisions. Allocations of water that could be extracted under bore licences thereafter were objects of commerce. They could be and were traded. An acquisition of property otherwise than on just terms? As noted earlier, there was a deal of controversy in this matter about whether s 51(xxxi) was engaged in any relevant respect. It will be necessary to consider some but not all aspects of that controversy. It is convenient to begin that consideration, however, by noting some principles about the application of s 51(xxxi) that are not disputed. First, it is well established that, as was said in Minister of State for the Army v Dalziel156, the guarantee effected by s 51(xxxi) of the Constitution 154 Water Legislation Amendment Act 1997 (NSW), Sched 1, item [15], inserting s 117E in the 1912 Act. 155 Water Legislation Amendment Act 1997, Sched 1, item [15], inserting s 117J in the 1912 Act. 156 (1944) 68 CLR 261 at 290; [1944] HCA 4. See also Bank of NSW v The Commonwealth ("the Banking Case") (1948) 76 CLR 1 at 299, 349; [1948] HCA 7; Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 509; [1993] HCA 10; Mutual Pools & Staff Pty Ltd v The (Footnote continues on next page) extends to protect against the acquisition, other than on just terms, of "every species of valuable right and interest including real and personal property, incorporeal hereditaments such as rents and services, rights of way, rights of profit or use in land of another, and choses in action" (emphasis added). Second, as was said in Telstra Corporation Ltd v The Commonwealth157: "[R]eferences to statutory rights as being 'inherently susceptible of change' must not be permitted to mask the fact that '[i]t is too broad a proposition ... that the contingency of subsequent legislative modification or extinguishment removes all statutory rights and interests from the scope of s 51(xxxi)'158." Rather, as the Court went on to point out in Telstra159: "[A]nalysis of the constitutional issues must begin from an understanding of the practical and legal operation of the legislative provisions that are in issue" (here the 1912 Act and the Water Management Act 2000). Third, it is now well established160 that: "To bring the constitutional provision [s 51(xxxi)] into play it is not enough that legislation adversely affects or terminates a pre-existing right that an owner enjoys in relation to his property; there must be an Commonwealth (1994) 179 CLR 155 at 172, 176, 184, 194, 201, 222; [1994] HCA 9; Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 559 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ; [1996] HCA 56; Attorney-General (NT) v Chaffey (2007) 231 CLR 651 at 663 [21] per Gleeson CJ, Gummow, Hayne and Crennan JJ; [2007] HCA 34; Telstra Corporation Ltd v The Commonwealth (2008) 234 CLR 210 at 232 [49] per Gleeson CJ, Gummow, Kirby, Hayne, Heydon, Crennan and Kiefel JJ; [2008] HCA 7. 157 (2008) 234 CLR 210 at 232 [49]. 158 Attorney-General (NT) v Chaffey (2007) 231 CLR 651 at 664 [24]. 159 (2008) 234 CLR 210 at 232 [49]. 160 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 145 per Mason J; [1983] HCA 21. See also at 247-248 per Brennan J, 282-283 per Deane J; Tape Manufacturers (1993) 176 CLR 480 at 499-500 per Mason CJ, Brennan, Deane and Gaudron JJ, 528 per Dawson and Toohey JJ. acquisition whereby the Commonwealth or another acquires an interest in property, however slight or insubstantial it may be." Fourth, as is evident from just quoted from The Commonwealth v Tasmania (The Tasmanian Dam Case), s 51(xxxi) can be engaged where there is an acquisition of property by the Commonwealth or by another161. As Aickin J pointed out in Trade Practices Commission v Tooth & Co Ltd162: the passage "It would be a serious gap in the constitutional safeguard which is the manifest policy of par (xxxi) if the Parliament could legislate for compulsory acquisition of property without just terms by statutory bodies which were not the Commonwealth itself or its agents or by persons or bodies having no connexion with the government. Neither the words of s 51 nor the context require the adoption of so anomalous a view." Finally, and more fundamentally, proper account must be taken of the principles which underpin the application that has been given to s 51(xxxi) in this Court's decisions. The root principle was identified by Dixon J in Bank of NSW v The Commonwealth ("the Banking Case")163: It provides serves a double purpose. "Section 51(xxxi) the Commonwealth Parliament with a legislative power of acquiring property: at the same time as a condition upon the exercise of the power it provides the individual or the State, affected with a protection against governmental interferences with his proprietary rights without just recompense. In both aspects consistency with the principles upon which constitutional provisions are interpreted and applied demands that the paragraph should be given as full and flexible an operation as will cover the objects it was designed to effect. Moreover, when a constitution undertakes to forbid or restrain some legislative course, there can be no prohibition to which it is more proper to apply the principle embodied in the maxim quando aliquid prohibetur, prohibetur et omne per quod devenitur ad illud. In requiring 161 Jenkins v The Commonwealth (1947) 74 CLR 400 at 406; [1947] HCA 41; McClintock v The Commonwealth (1947) 75 CLR 1 at 23-24, 36; [1947] HCA 39; P J Magennis Pty Ltd v The Commonwealth (1949) 80 CLR 382 at 401-402, 411, 423; Trade Practices Commission v Tooth & Co Ltd (1979) 142 CLR 397 at 427, 451-452; [1979] HCA 47. 162 (1979) 142 CLR 397 at 452. 163 (1948) 76 CLR 1 at 349-350. just terms s 51(xxxi) fetters the legislative power by forbidding laws with respect to acquisition on any terms that are not just." It has been sought to capture this root principle in the metaphor of "abstraction" from power, coined by Aickin J in Trade Practices Commission v Tooth & Co Ltd164 and discussed in Wurridjal v The Commonwealth165. And just as in Wurridjal the notion of s 51(xxxi) "abstracting" the power of acquisition was used to suggest that there could be no relevant intersection between s 51(xxxi) and s 122, echoes of like arguments could be heard in this case when it was said that there was no intersection between s 51(xxxi) and s 96 because s 96 is not to be read as a head of legislative power. But as was pointed out166 in Wurridjal, the critical observation to make about the application of the principle of interpretation stated in the Banking Case, and later in Attorney-General (Cth) v Schmidt167, is that it cannot be confined to construction of the heads of power enunciated in s 51. "The principle, the soundness of which is not disputed, must be applied to all heads of the power of the Parliament."168 Because s 51(xxxi) "undertakes to forbid or restrain some legislative course"169 and "should be given as full and flexible an operation as will cover the objects it was designed to effect"170, its operation is not to be circumvented by some "circuitous device"171. But no issue of circuitous device arises here. The question argued in this matter by reference to Magennis is whether s 51(xxxi) intersects in some relevant manner with s 96. More particularly, in fixing "such terms and conditions as the Parliament thinks fit" for the grant of financial assistance to a State under s 96, may the Parliament fix a term or condition that requires compulsory acquisition of property by the State otherwise than on just terms? 164 (1979) 142 CLR 397 at 445. 165 (2009) 237 CLR 309 at 387 [186]; [2009] HCA 2. 166 (2009) 237 CLR 309 at 386-387 [185]. 167 (1961) 105 CLR 361 at 371-372; [1961] HCA 21. 168 (2009) 237 CLR 309 at 386-387 [185]. 169 Banking Case (1948) 76 CLR 1 at 349-350. 170 (1948) 76 CLR 1 at 349. 171 (1948) 76 CLR 1 at 349. See also O Gilpin Ltd v Commissioner for Road Transport and Tramways (NSW) (1935) 52 CLR 189 at 211-212; [1935] HCA 8. That question was answered in the negative in Magennis. The law impugned in that case (the War Service Land Settlement Agreements Act 1945 (Cth)) approved the making by the Commonwealth of intergovernmental agreements with States that, when made in 1945, would provide for States to acquire land compulsorily at prices fixed at 1942 values. The majority in Magennis characterised the law as a law with respect to acquisition of property. The dissenting view, expressed by Dixon J, depended upon confining the considerations relevant to the characterisation of the impugned law to the rights and duties created by the law and excluding from consideration the practical effect of the law. The impugned law, in the opinion172 of Dixon J, did no more than authorise the making of an agreement; the Act itself neither authorised the acquisition of property nor contained any provision about property. In his Honour's opinion173, the law was not to be characterised as a law with respect to an acquisition of property because, under an agreement, the making of which by the Commonwealth was authorised by federal law, the State undertook to exercise its powers of acquisition. For the purposes of this case it is enough to make only the following points. First, it is now well established that the practical operation of a law is not irrelevant to questions of characterisation174. Of course, the character of the law must be determined by reference to the rights, powers, liabilities, duties and privileges which it creates175. But the practical operation of the law must also be considered in determining the sufficiency of the connection. Second, a law may contravene the constitutional restraint on the power of acquisition – that just terms be provided – directly or indirectly, explicitly or implicitly. To adopt and adapt what Dixon J said in the context of s 92 in O Gilpin Ltd v Commissioner for Road Transport and Tramways (NSW)176, 172 (1949) 80 CLR 382 at 410. 173 (1949) 80 CLR 382 at 411. 174 Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 368-369; [1995] HCA 16; Leask v The Commonwealth (1996) 187 CLR 579 at 601-602, 621, 633-634; [1996] HCA 29; Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 492 [16]; [2000] HCA 14. 175 Fairfax v Federal Commissioner of Taxation (1965) 114 CLR 1 at 7; [1965] HCA 64; Kartinyeri v The Commonwealth (1998) 195 CLR 337 at 352-353 [7], 372 [58]; [1998] HCA 22. 176 (1935) 52 CLR 189 at 211-212. however circuitous or disguised it may be, once it appears that the law is a law with respect to acquisition otherwise than on just terms, it is discovered to be an infringement of the restriction upon power contained in s 51(xxxi). Third, no textual or other reason was identified in argument, beyond the conclusion about characterisation reached by Dixon J in Magennis, which led inexorably to the conclusion that the power given by the Parliament to fix terms and conditions for grants of financial assistance to the States under s 96 is unrestrained by s 51(xxxi). More particularly, the debate about whether the reference in s 96 to "such terms and conditions as the Parliament thinks fit" is properly described as a head of legislative power is a debate more about taxonomy than about the critical question of how s 96, when read in the context of the Constitution as a whole, is to be understood. In the end, however, it will not be necessary to decide whether Magennis should be reopened or to decide an issue about the intersection of s 96 and s 51(xxxi). That will not be necessary because there has been no acquisition of property. And because it is not necessary to decide questions about the intersection of s 96 and s 51(xxxi), it is necessary not to decide them. Since its earliest days177, the Court has followed the precept that constitutional questions should not be decided unless it is necessary "to do justice in the given case and to determine the rights of the parties"178. There is no occasion in this matter to depart from that principle. No acquisition of property The acquisition of property of which the plaintiffs complain is alleged to have been effected by the replacement of their bore licences by aquifer access licences with smaller extraction entitlements. (In argument the plaintiffs often referred to this process as a "cancellation" of their bore licences and the issue of the new licences. Nothing turns on the accuracy of this description.) The closer 177 See, for example, Attorney-General for NSW v Brewery Employés Union of NSW (1908) 6 CLR 469 at 590; [1908] HCA 94; Universal Film Manufacturing Co (Australasia) Ltd v New South Wales (1927) 40 CLR 333 at 347, 356; [1927] HCA 178 Lambert v Weichelt (1954) 28 ALJ 282 at 283; Cheng v The Queen (2000) 203 CLR 248 at 270 [58]; [2000] HCA 53; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 473-474 [249]-[252]; [2001] HCA 51; BHP Billiton Ltd v Schultz (2004) 221 CLR 400 at 443 [94], 468 [177]; [2004] HCA 61; Chief Executive Officer of Customs v El Hajje (2005) 224 CLR 159 at 171 [28]; [2005] HCA 35. management of groundwater resources in New South Wales that has been applied in the 1990s and thereafter should not be permitted to obscure four considerations essential to an examination of whether the steps described effected an acquisition of property. The first point to recall is that, unlike minerals, if groundwater is extracted it will ordinarily be replaced, over time and at least to some extent, by natural processes. An important purpose for regulating access to groundwater is thus to ensure that the resource is neither depleted nor degraded. That is, control is directed not just to the use, consumption, or extraction of the resource, but to ensuring its continuing availability. The second point to bear in mind is that bore licences and aquifer access licences are each creatures of statute. And each form of licence is, or was, a statutory dispensation from a general prohibition against the taking of groundwater. Because all sub-surface water was vested in the State in 1966, none of the licences was a regulation of some common law right to extract groundwater. That right had disappeared altogether in 1966 with the vesting of sub-surface water in the State, if, that is, it had not been extinguished previously by the earlier legislation regulating bores. And because the rights given by the licences were statutory rights, they were inherently susceptible179 to change or termination. (As the description of legislative history set out earlier shows, those rights have often been changed.) Since at least 1966, the rights to extract specified volumes of water in accordance with the bore licences could be restricted or controlled. And from 1984, the terms and conditions of the licences included a condition permitting variation of the water allocation. The third point is that to speak of groundwater (before extraction) as a subject of "property", whether "owned" by the State or a person, seeks to engage legal concepts that have not hitherto been applied by the common law to water before it is reduced to possession. Water in the ground is a replaceable but fugitive resource. As was said in the passage from Embrey v Owen180 that is set out earlier in these reasons, in connection with riparian rights, flowing surface water is "publici juris, not in the sense that it is a bonum vacans ... but that it is 179 Health Insurance Commission v Peverill (1994) 179 CLR 226; [1994] HCA 8; Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513; [1997] HCA 38; Attorney-General (NT) v Chaffey (2007) 231 CLR 651. 180 (1851) 6 Ex 353 at 369 [155 ER 579 at 585]. public and common". No one has, or can have, property in it until it is reduced to possession. Or as Blackstone had put the same point, much earlier181, "water is a moveable, wandering thing, and must of necessity continue common by the law of nature; so that I can only have a temporary, transient, usufructuary property therein". The point, made in Embrey v Owen and by Blackstone with respect to surface water, applies with as much, if not greater, force to groundwater before it is extracted and reduced to possession. The fourth point to recall is that the particular rights which the State now has with respect to groundwater, like the rights the plaintiffs had under their bore licences, or now have under their aquifer access licences, are creatures of statute. In 1966, the State's rights with respect to groundwater were described as the "right to the use and flow and to the control of all sub-surface water"182. Those rights were vested183 in a public authority for the benefit of the Crown. The Water Management Act 2000 now makes substantially identical provision in s 392(1) and (2)184. The vesting of the rights to the control, use and flow of sub-surface water thus effected in the Crown is to be understood at least by 181 Blackstone, Commentaries on the Laws of England, (1766), bk 2, c 2 at 18. 182 1912 Act, s 4B, as inserted by s 3(c) of the 1966 Amendment Act. 183 1912 Act, s 4B, as inserted by s 3(c) of the 1966 Amendment Act. 184 Section 392 provides, in part: "(1) For the purposes of this Act, the rights to the control, use and flow of: (a) all water in rivers, lakes and aquifers, and (b) all water conserved by any works that are under the control or management of the Minister, and (c) all water occurring naturally on or below the surface of the ground, are the State's water rights. (2) The State's water rights are vested in the Crown, except to the extent to which they are divested from the Crown by or under this or any other Act." reference to, if not as limited in effect by, the statutory purposes to be fulfilled in consequence of the vesting185. Those purposes can be described as controlling access to a public resource. So understood, the vesting of groundwater effected in 1966 was but a further step along a path that had been set at least by 1930 if not much earlier. Moreover, the references to "control", "use" and "flow" are important. Those are the rights that are vested in the Crown186. It may readily be accepted that the bore licences that were cancelled were a species of property. That the entitlements attaching to the licences could be traded or used as security amply demonstrates that to be so. It must also be accepted, as the fundamental premise for consideration of whether there has been an acquisition of property, that, until the cancellation of their bore licences, the plaintiffs had "entitlements" to a certain volume of water and that after cancellation Those "entitlements" were themselves fragile. They could be reduced at any time, and in the past had been. But there can be no acquisition of property unless some identifiable and measurable advantage is derived by another from, or in consequence of, the replacement of the plaintiffs' licences or reduction of entitlements187. That is, another must acquire "an interest in property, however slight or insubstantial it may be"188. their "entitlements" were less. The only possible recipient of an advantage in this matter is the State. Did it derive some advantage from replacing the bore licences or reducing water entitlements? The four considerations set out earlier in these reasons (the replaceable and fugitive nature of groundwater; that the licences in issue are a creature of statute and inherently fragile; that groundwater has not hitherto been thought to be a subject of property; and that the rights vested in the State are statutory rights 185 H Jones & Co Pty Ltd v Kingborough Corporation (1950) 82 CLR 282 at 320-322 per Dixon J; [1950] HCA 11. 186 Compare, this respect, the Kingborough Corporation Case where "every river, creek, or watercourse" within a designated area was vested in the council of the relevant municipality. legislation considered the 187 Newcrest (1997) 190 CLR 513 at 560 per Toohey J, 561 per Gaudron J, 634 per 188 The Tasmanian Dam Case (1983) 158 CLR 1 at 145 per Mason J; Tape Manufacturers (1993) 176 CLR 480 at 500 per Mason CJ, Brennan, Deane and Gaudron JJ, 528 per Dawson and Toohey JJ. for the purpose of controlling access to a public resource) all point towards the conclusion that the State gained no identifiable or measurable advantage from the steps that have been taken with respect to the plaintiffs' water licences and entitlements. Since at least 1966 no landowner in New South Wales has had any right to take groundwater except pursuant to licence. The rights the plaintiffs had under their bore licences (in particular, their right to extract certain volumes of water) did not in any sense "return" to the State upon cancellation of the licences. The State gained no larger or different right itself to extract or permit others to extract water from that system. It gained no larger or different right at all. The plaintiffs submitted that the cancellation of their bore licences and the issue of new licences permitting extraction of less water was as much an acquisition of their property as the legislation considered in Newcrest Mining (WA) Ltd v The Commonwealth189 was an acquisition of Newcrest's mining tenements. But the cancellation of licences to extract groundwater stands in sharp contrast with the effective acquisition of the substance of the proprietary interests in mining tenements considered in Newcrest. The rights enjoyed under those mining tenements included a grant and demise of the relevant parcel of land, and the mines and mineral deposits in or under the land together with appurtenant rights. By the legislation in issue in Newcrest, the land in question, except for minerals, was vested in the Director of National Parks and Wildlife, and operations for recovering minerals were forbidden. Both the Director and the Commonwealth thus acquired identifiable and measurable advantages. The Director acquired land freed from the rights of Newcrest to occupy it and conduct mining operations; the Commonwealth acquired the minerals freed from the rights of Newcrest to mine them. The property which Newcrest had was held to be more than a statutory privilege under a licensing system. The statutes by which the mining tenements were created carved those interests out of the radical title of the Commonwealth to the land. The mining tenements were a species of property in the land and in the minerals which, when the rights under the mining tenements came to an end, enlarged the Commonwealth's radical title to the land. For the reasons given earlier, that is not the case here. Although all sub-surface water is now, and since 1966 has been, vested in the State, it is not right to describe the consequence of that vesting as giving the State ownership of, or property in, the groundwater. It is not right to do so 189 (1997) 190 CLR 513. because, as explained earlier, the difficulties and incongruities of treating water in the ground as a subject of property are insuperable. And in any event, the measure of control which the State has over the resource was unaltered by the cancellation of any particular entitlements to extract groundwater. The amount of water that the State could permit to be extracted was bounded only by the physical state and capacity of the aquifer, and such policy constraints as the State chose to apply. Neither the existence, nor the replacement or cancellation, of particular licences altered what was under the control of the State or could be made the subject of a licence to extract. If, as was hoped or expected, the amount of water in the aquifer would thereafter increase (or be reduced more slowly) the State would continue to control that resource. But any increase in the water in the ground would give the State no new, larger, or enhanced "interest in property, however slight or insubstantial"190, whether as a result of the cancellation of the plaintiffs' bore licences or otherwise. There has been no acquisition of property. Conclusion and answers For these reasons, the questions in the Special Case should be answered adversely to the plaintiffs. It is desirable, however, to give more than a bare negative answer to Question 1, lest the brevity of the answer be misunderstood as accepting some or all of the further premises that were implicit in that question. Question 1 should be answered: "The replacement of the plaintiffs' bore licences did not constitute an acquisition of property within the meaning of s 51(xxxi) of the Constitution. Accordingly, the questions of invalidity posed in pars (a) and (b) of Question 1 do not arise." Question 3 should be answered "No". It is not necessary to answer Questions 2 or 4. The plaintiffs must pay the costs of the Special Case. Question 5 should be answered accordingly. 190 The Tasmanian Dam Case (1983) 158 CLR 1 at 145 per Mason J; Tape Manufacturers (1993) 176 CLR 480 at 500 per Mason CJ, Brennan, Deane and 158 HEYDON J. The circumstances are fully set out in other judgments. The plaintiffs' loss of their bore licences licences" issued pursuant The plaintiffs occupy properties in the Lower Lachlan for the purposes of farming (including growing grapes, oranges and crops) and producing livestock. Before 1 February 2008 they had bore licences under the Water Act 1912 (NSW) in relation to those properties. Those licences gave them "entitlements" to extract water from what is known as the Lower Lachlan Groundwater System – a group of aquifers in that region which have some degree of hydrological connection. On 1 February 2008 their bore licences were replaced by "aquifer access the Water Management (General) Amendment (Lower Lachlan) Regulation 2008 (NSW) made under the Water Management Act 2000 (NSW). The Special Case called this "the Amendment Regulation". While in recent years the amount of water the plaintiffs were actually allocated and took under the bore licences was much less than 100 percent of their entitlements, the entitlements of the plaintiffs under the new aquifer access licences were 6,131 megalitres per annum – less than one-third of their entitlements under the bore licences and significantly less than what they had been taking. Thus, for example, while the first two plaintiffs in the year 1 July 2006 to 30 June 2007 had entitlements to take 18,638 megalitres, and their permitted allocation was 10,251 megalitres, under the aquifer access licences they were only entitled to 5,198 megalitres. For the plaintiffs, this development was potentially calamitous. By what route had it come to pass? The history In August 1997 the Government of New South Wales published "The NSW State Groundwater Policy Framework Document". That document evinced a concern to provide a framework for the sustainable management of groundwater. That concern also underlay the Water Management Act 2000. On 26 February 2003, pursuant to s 50 of the Water Management Act 2000, the relevant Minister made the Water Sharing Plan for the Lower Lachlan Groundwater Source 2003 Order. It provided for lower extraction limits in relation to Lower Lachlan groundwater. That Plan never commenced in the form in which it was made. But it did commence on 1 February 2008, in an amended form, as a result of the following events. On 25 June 2004 an inter-governmental agreement between (inter alia) the Commonwealth and New South Wales was entered. It is known as "the National Water Initiative". One of its objectives was to "complete the return of all currently overallocated or overused systems to environmentally-sustainable levels of extraction" (italics in original). It required the Commonwealth to establish a "National Water Commission". On 13 September 2004 the Commonwealth announced a "Water Smart Australia" program involving the establishment of an "Australian Water Fund" from which funding would be available in order to advance the objectives of the National Water Initiative. On 17 December 2004 the National Water Commission Act 2004 (Cth) commenced. As contemplated by the National Water Initiative, s 6 created a National Water Commission. Section 7(1)(a) provided that one of the National Water Commission's functions was to assist in the implementation of the National Water Initiative. Section 40 created "the Australian Water Fund Account". Section 24(1)(a)(i) provided that the functions of the Chief Executive Officer of the National Water Commission included administering "financial assistance, awarded by the Minister to particular projects relating to Australia's water resources", from the Australian Water Fund Account, and s 42(a)(i)191 provided that amounts could be debited from the Australian Water Fund Account for that purpose. On 9 February 2005 the Premier of New South Wales asked the Commonwealth for $55 million from the Australian Water Fund, to be matched with $55 million from New South Wales, in order to assist water sharing in (inter alia) the Lower Lachlan. On 4 November 2005 the Commonwealth and New South Wales entered a Funding Agreement. The Commonwealth agreed to pay New South Wales $55 million. In return New South Wales promised to fulfil the goals of the National Water Initiative. It promised to implement "Water Sharing Plans" which reduced the water entitlements of water licence holders in the Lower Lachlan by 56 percent. And it promised to convert (inter alia) the plaintiffs' bore licences under the Water Act 1912 to aquifer access licences under the Water Management Act 2000. On 19 December 2007 the relevant New South Wales Minister was advised by his Department that it was necessary to amend the Water Sharing Plan for the Lower Lachlan Groundwater Source 2003 Order in order to align it with "the recent approvals under the joint $130 million NSW and Commonwealth Governments' Achieving Sustainable Groundwater Entitlements … program." That was a reference to the total amount of money intended on 19 December 2007 to be provided under the Funding Agreement of 4 November 2005. The 191 See [14]. Department advised that it was necessary to reduce water entitlements further, to the "sustainable yield limit." In reliance on that advice, on 11 January 2008 the Minister, acting under s 45(1) of the Water Management Act 2000, made the Water Sharing Plan for the Lower Lachlan Groundwater Source Amendment Order 2008. The Special Case called this "the Amendment Order". On 30 January 2008 a Proclamation was issued declaring that the Water Management Act 2000, Ch 3, Pt 2 (access licences) and Pt 3 (approvals), applied to each water source to which the Water Sharing Plan for the Lower Lachlan Groundwater Source 2003 applied. The Special Case called this "the Proclamation". Its practical efficacy thus depended on the validity of the Amendment Order. Two days later the Amendment Regulation was made. It substituted the aquifer access licences for the plaintiffs' bore licences. Its practical efficacy, too, depended on the Amendment Order, since the reduced entitlements were framed by reference to the methodology in the Amendment Order. By those last three steps New South Wales fulfilled the promise it had made in the Funding Agreement to reduce water entitlements in the Lower Lachlan and convert the plaintiffs' bore licences to aquifer access licences. The starting point of the plaintiffs' case The plaintiffs attack the validity of the Amendment Regulation which replaced their bore licences with aquifer access licences. They submit that its validity depends on the validity, in turn, of the Proclamation, the Amendment Order and the Funding Agreement. They submit that the validity of the Funding Agreement is not supported by the executive power of the Commonwealth under s 61 of the Constitution. Nor is it supported by the National Water Commission Act 2004. That is because, they submit, that Act, though otherwise validly enacted pursuant to Commonwealth legislative power, in authorising the Chief Executive Officer on behalf of the Commonwealth to enter the Funding Agreement, permitted the provision of financial assistance to New South Wales. The financial assistance was provided on the condition that New South Wales acquire property in the form of the plaintiffs' bore licences, in a manner contravening s 51(xxxi) of the Constitution, since that acquisition was not on just terms. The irrelevance of s 61 Can s 61 support the validity of the Funding Agreement? Section 61 can be put aside at the outset. The legislation permitting the grant of Commonwealth funding to New South Wales was supported by s 96 read with s 51(xxxvi). Contrary to the submissions of the Solicitor-General of the Commonwealth, s 51(xxxi) applies to s 96 for reasons given above192. The Solicitor-General accepted that in that event an agreement to facilitate the grant which could not be supported by s 96 because of non-compliance with s 51(xxxi) could not be supported by s 61 either. Accordingly the key issue is whether there was an acquisition of property by New South Wales otherwise than on just terms within the meaning of s 51(xxxi). Section 51(xxxi): general There is a common law rule of statutory interpretation requiring that "clear and unambiguous words be used before there will be imputed to the legislature an intent to expropriate or extinguish valuable rights relating to property without fair compensation."193 According to Griffith CJ, one of the framers of the Constitution, though not of s 51(xxxi), the necessary intent had to be "expressed in unequivocal terms incapable of any other meaning"194. There is also a common law rule of statutory construction that an "executive power to deprive a citizen of his property by compulsory acquisition should be construed as being confined within the scope of what is granted by the clear meaning or necessary intendment of the words by which it is conferred"195. Further, a "body …, authorized to take land compulsorily for specified purposes, will not be permitted to exercise its powers for different purposes, and if it attempts to do so, the Courts will interfere."196 But s 51(xxxi) goes beyond rules of construction or judicial review of administrative action. Section 51(xxxi) is incapable of being 192 See [31]-[45]. For the most part these reasons are structured by reference to the arguments of the Solicitor-General of the Commonwealth. The arguments of the other defendants, and of the interveners, in general corresponded with his. But there were some contradictions between some of the arguments advanced by those opposed to the plaintiffs. Not all other parties and interveners advanced all the Solicitor-General's arguments. Some of their arguments were not advanced by him. Where necessary, those last-mentioned arguments will be dealt with in the appropriate places. 193 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 111 per Deane and Gaudron JJ; [1992] HCA 23. 194 The Commonwealth v Hazeldell Ltd (1918) 25 CLR 552 at 563 per Griffith CJ and Rich J; [1918] HCA 75. 195 Clunies-Ross v The Commonwealth (1984) 155 CLR 193 at 201 per Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ; [1984] HCA 65. 196 Municipal Council of Sydney v Campbell [1925] AC 338 at 343 per Viscount Cave, Lord Blanesburgh, Duff J and Sir Adrian Knox. overridden by statutory words, clear or not. It provides that the Parliament has power to make laws with respect to "the acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws". In Minister of State for the Army v Dalziel197 Latham CJ said that s 51(xxxi) "is plainly intended for the protection of the subject". How does it protect the subject? In part, plainly, it does so simply because as a matter of justice compensation is to be given for something which the subject has lost as a result of the legislature having pursued a wider public goal198. A democratic electorate would not regard expropriation without compensation in time of peace with equanimity. "What the public enjoys should be at the public, and not [at] private expense."199 That was certainly what Dixon J saw as the purpose of the "just terms" requirement: "to prevent arbitrary exercises of the power [of compulsory acquisition] at the expense of a State or the subject."200 There are, however, functions served by s 51(xxxi) which extend beyond the simple protection of the subject, whether this was intended by the framers or not, and whether contemporaries of the framers would have perceived them as being served or not. One of these functions was seen by Hayek as fundamentally significant. He said201: "The principle of 'no expropriation without just compensation' has always been recognized wherever the rule of law has prevailed[202]. It is, 197 (1944) 68 CLR 261 at 276; [1944] HCA 4. 198 Hayek, The Constitution of Liberty, (1960) at 218. 199 Smith v ANL Ltd (2000) 204 CLR 493 at 542 [156] per Callinan J; [2000] HCA 58. 200 Grace Brothers Pty Ltd v The Commonwealth (1946) 72 CLR 269 at 291; [1946] HCA 11. 201 The Constitution of Liberty, (1960) at 217-218. 202 This is an extreme and not wholly accurate statement, but it does not stand alone. Thus in the Supreme Court of India, in The State of Bihar v Maharajadhiraja Sir Kameshwar Singh of Darbhanga [1952] SCR 889 at 1008, Chandrasekhara Aiyar J said that: "From very early times, law has recognized the right of Government compulsorily to acquire private properties of individuals for a public purpose … But it is a principle of universal law that the acquisition can only be on payment of just compensation." however, not always recognized that this is an integral and indispensable element of the principle of the supremacy of the law. Justice requires it; but what is more important is that it is our chief assurance that those necessary infringements of the private sphere will be allowed only in instances where the public gain is clearly greater than the harm done by the disappointment of normal individual expectations. The chief purpose of the requirement of full compensation is indeed to act as a curb on such infringements of the private sphere and to provide a means of ascertaining whether the particular purpose is important enough to justify an exception to the principle on which the normal working of society rests. In view of the difficulty of estimating the often intangible advantages of public action and of the notorious tendency of the expert administrator to overestimate the importance of the particular goal of the moment, it would even seem desirable that the private owner should always have the benefit of the doubt and that compensation should be fixed as high as possible without opening the door to outright abuse. This means, after all, no more than that the public gain must clearly and substantially exceed the loss if an exception to the normal rule is to be allowed." The requirement to provide just terms thus compels the legislature to consider the true cost of the legislation – not merely the political pain to be endured, which, where the persons whose property is being acquired have little electoral weight, may be quite small203. Some other factors have been identified by economists204. Unless they have a duty to pay compensation, legislatures will tend to experience undue temptation to acquire the property of citizens, and will tend to give into it, because this will usually be cheaper than employing some alternative technique. The threat that legislatures will acquire property without just compensation will result in people electing not to generate property by saving, or developing their property to less than optimal levels, or seeking a greater rate of return to meet the risk of acquisition, or pursuing investment opportunities in jurisdictions which do 203 Kirby J said that s 51(xxxi) ensures that "proper consideration is given to the costs The for which Commonwealth v Western Australia (1999) 196 CLR 392 at 462 [194]; [1999] HCA 5. thereby rendered accountable": the Commonwealth 204 Evans and Quigley, "Compensation for Takings of Private Property Rights and the Rule of Law", unpublished paper delivered at the Modern Challenges to the Rule of Law Conference, Auckland, New Zealand, 23 October 2009 at 5-7. provide compensation for compulsory acquisition205. The threat of acquisition without compensation thus damages incentives to invest. It damages the prospect of a dynamically efficient economy in which incentives to invest improve long-term social welfare by creating an optimal level and allocation of investment resources. To fulfil public purposes by taking private property without compensation is functionally equivalent to fulfilling those purposes by levying specific taxes on the owners of that property, and only those owners – a less efficient technique than levying taxes much more broadly in order to fund the just compensation. And there is a peculiar injustice in removing what may be the whole of one citizen's assets without compensation instead of funding compensation for that citizen by taking a very small part of the assets of all taxpayers. Like the Fifth Amendment to the United States Constitution, s 51(xxxi) has the effect of barring "Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole."206 Acquiring property without compensation imposes high costs on a small social group, sometimes at the behest of other groups having influence with the legislature: the need to pay compensation protects the position of the former and diffuses the relative power of the latter. For these reasons it has long been thought that governments ought to pay compensation when they acquire property by compulsion. Quick and Garran saw the requirement for just compensation in s 51(xxxi) as being "consistent with the common law of England and the general law of European nations."207 So far as English law is concerned, this is an exaggeration in theory, but, at least for a long time, there was a practice of giving compensation on expropriation. In 1215 Magna Carta forbad constables or their bailiffs taking corn or other chattels without payment (Ch 19) and also forbad sheriffs and bailiffs from taking horses, carts, wood or other goods necessary for the King's household without payment (Ch 21); in the 15th century Sir John Fortescue 205 See The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 102 [259] per Kirby J; [1998] HCA 8 ("investors will draw their inferences"), approved by Callinan J in Smith v ANL Ltd (2000) 204 CLR 493 at 554 [188]. 206 Armstrong v United States 364 US 40 at 49 (1960) per Black J, delivering the opinion of five Justices. See also The Commonwealth v Western Australia (1999) 196 CLR 392 at 462 [194], where Kirby J said that s 51(xxxi) ensures "that the true costs of the Commonwealth's activities … will not fall unjustly on those whose property rights are extinguished or diminished." 207 The Annotated Constitution of the Australian Commonwealth, (1901) at 641. reaffirmed those duties, and it has been claimed that they were never doubted thereafter208. In 1765 Blackstone asserted that the legislature could "interpose, and compel the individual to acquiesce" in the compulsory acquisition of the latter's property. "But how does it interpose and compel? Not by absolutely stripping the subject of his property in an arbitrary manner; but by giving him a full indemnification and equivalent for the injury thereby sustained. … All that the legislature does is to oblige the owner to alienate his possessions for a reasonable price; and even this is an exertion of power, which the legislature indulges with caution, and which nothing but the legislature can perform."209 In the next year Lord Camden, in his maiden speech to the House of Lords, said that Parliament "cannot take away any man's private property without making him a compensation. A proof of which is the many private bills, as well as public, passed every session."210 At least in time of peace, property could not be acquired without legislation, which very often provided for compensation; and the right to requisition property in time of war under the prerogative was only exercised, and could only be exercised, on payment of compensation211. But while it was very common for expropriation only to be effected on payment of compensation, it is not correct to say that there could be no expropriation without compensation. It was clearly established in England before federation that although there was a presumption of construction against the compulsory acquisition of property without compensation, the legislature could "override or disregard" it212. And it is clearly established in this Court that there is no rule of law (apart from s 51(xxxi) and statutes specifically providing for compensation) that the legislature is incapable of acquiring property without just terms213. But, 208 Mann, "Outlines of a History of Expropriation", (1959) 75 Law Quarterly Review 188 at 194. For a more detailed account, see Stoebuck, "A General Theory of Eminent Domain", (1972) 47 Washington Law Review 553 at 575-579. 209 Commentaries on the Laws of England, (1765), bk 1, c 1 at 135. 210 The Parliamentary History of England from the Earliest Period to the Year 1803, (1813), vol 16 at 168. 211 Attorney-General v De Keyser's Royal Hotel [1920] AC 508; Burmah Oil Co Ltd v Lord Advocate [1965] AC 75. 212 London and North Western Railway Co v Evans [1893] 1 Ch 16 at 28 per Bowen LJ. 213 Durham Holdings Pty Ltd v New South Wales (2001) 205 CLR 399; [2001] HCA 7. at least in the late 19th century, legislative acquisition of property without compensation was regarded as highly undesirable. So far as "the general law of European nations" to which Quick and Garran referred is concerned, F A Mann has offered the following summary. In Greece expropriation without compensation was regarded as inconsistent with the nature of property, and in Rome expropriation was almost unknown. In the Middle Ages, as a general rule, where expropriation was effected for the public benefit, compensation was payable. Grotius thought that it ought to be. That view was common throughout Europe before the French Revolution. In France it appeared in the Declaration of the Rights of Man and of the Citizen on 28 August 1789, was incorporated into the Constitution of 1791 and appeared in Art 545 of the Code Civil. It was also introduced into many constitutions214. The age when the Constitution was drafted was the apogee of liberalism, and the protection of property rights was central to the liberal creed. Locke had taught: "the preservation of Property being the end of Government, and that for which Men enter into Society, it necessarily supposes and requires, that the People should have Property"215. Bentham had said216: "Property and law are born together, and die together. Before laws were made there was no property; take away laws, and property ceases. As regards property, security consists in receiving no check, no shock, no derangement to the expectation founded on the laws, of enjoying such and such a portion of good. The legislator owes the greatest respect to this expectation which he has himself produced. When he does not contradict it, he does what is essential to the happiness of society; when he disturbs it, he always produces a proportionate sum of evil." Maine had contended that the history of individual property rights and the history of civilisation "cannot be disentangled."217 Lord Acton thought that "a people averse to the institution of private property is without the first element of 214 Mann, "Outlines of a History of Expropriation", (1959) 75 Law Quarterly Review 188 at 193, 201-210. See generally Garner (ed), Compensation for Compulsory Purchase: A Comparative Study, (1975). 215 Locke, "An Essay Concerning the True Original, Extent, and End of Civil Government", in Two Treatises of Government, Laslett ed (1960) 285 at 378 (emphasis in original). 216 Theory of Legislation, Hildreth tr (1864) at 113. 217 Village-Communities in the East and West, 7th ed (1895) at 230. freedom."218 So deeply was the age of federation steeped in respect for property rights that Sir George Turner, Premier of Victoria, told the Third Session of the Convention at Melbourne on 25 January 1898, with all the innocent naiveté of someone who could not foresee how far 20th century governments all over the world were to go in seeking to make property rights precarious, that the proposed provision for just terms was unnecessary: "We assume that the Federal Parliament will act strictly on the lines of justice."219 That background tends to fortify the numerous statements which have been made in this Court about the width of s 51(xxxi) and its key terms. Section 51(xxxi): approach to construction General. Section 51(xxxi) is a "provision of a fundamental character"220. There are many cases, particularly in the last quarter century, in which Justices of this Court have concurred in Dixon J's description of it as a constitutional guarantee221. It is one of "the relatively few guarantees of rights thought so 218 The History of Freedom and Other Essays, (1907) at 297. 219 Official Record of the Debates of the Australasian Federal Convention, (Melbourne), 25 January 1898 at 153. 220 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 285 per Rich J. 221 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349 per Dixon J; [1948] HCA 7. See The Commonwealth v Tasmania (1983) 158 CLR 1 at 282 per Deane J; [1983] HCA 21; Clunies-Ross v The Commonwealth (1984) 155 CLR 193 at 202 per Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ; Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 509 per Mason CJ, Brennan, Deane and Gaudron JJ; [1993] HCA 10; Mutual Pools & Staff Pty Ltd v The Commonwealth (1994) 179 CLR 155 at 168 per Mason CJ, 180 per Brennan J and 184-185 per Deane and Gaudron JJ; [1994] HCA 9; Health Insurance Commission v Peverill (1994) 179 CLR 226 at 241 per Brennan J; [1994] HCA 8; Re Director of Public Prosecutions; Ex parte Lawler (1994) 179 CLR 270 at 277 per Brennan J and 283-285 per Deane and Gaudron JJ; [1994] HCA 10; Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 303 per Mason CJ, Deane and Gaudron JJ, 312 per Brennan J and 320 per Toohey J; [1994] HCA 6; Gambotto v Resolute Samantha Ltd (1995) 69 ALJR 752 at 754 per Gummow J; 131 ALR 263 at 267; [1995] HCA 48; Victoria v The Commonwealth (1996) 187 CLR 416 at 559 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ; [1996] HCA 56; The Commonwealth v Mewett (1997) 191 CLR 471 at 534-535, 550, 552 and 556-557 per Gummow and Kirby JJ; [1997] HCA 29; Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 542 per Brennan CJ, 560 per Toohey J, (Footnote continues on next page) fundamental to the … people of Australia that they had to be expressly stated in the constitutional text."222 It is "a very great constitutional safeguard"223. It is "an important provision of the Constitution which deals with individual rights"224. It is an "express constitutional promise"225. It is "relevant to the fundamental rights of all persons from whom property is compulsorily acquired"226. It "is to be given the liberal construction appropriate to such a constitutional provision"227. That is because a constitutional guarantee "calls for 'a generous interpretation … suitable to give to individuals the full measure of the fundamental rights and 561 and 565 per Gaudron J, 585 per McHugh J, 589, 595, 601, 602-603, 605, 607, 611, 612, 614 and 618 per Gummow J and 653 and 654 per Kirby J; [1997] HCA 38; The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 15 [12] per Brennan CJ, 27 [45] per Toohey J, 35 [77] per Gaudron J, 69 [181] and 73 [194] per Gummow J and 90 [237], 99 [252]-[253], 100-101 [256]-[257] and 102 [259] per Kirby J; Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 193 [147] per Gaudron J; [1999] HCA 62; Smith v ANL Ltd (2000) 204 CLR 493 at 500 [7] and 501 [9] per Gleeson CJ, 520 [74] per Kirby J and 542 [157] and 555 [193] per Callinan J; Telstra Corporation Ltd v The Commonwealth (2008) 234 CLR 210 at 232 [49] per Gleeson CJ, Gummow, Kirby, Hayne, Heydon, Crennan and Kiefel JJ; [2008] HCA 7. In The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 48 [126] McHugh J denied that s 51(xxxi) was a constitutional guarantee, but said "it may do no great harm" to use that language in "cases where the existence of the property in issue depends on the general law and not a federal enactment". The bore licences depended on State law derived from the common law, not on a federal enactment: see [195]-[196] below. 222 Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 654 per 223 Trade Practices Commission v Tooth & Co Ltd (1979) 142 CLR 397 at 403 per Barwick CJ; [1979] HCA 47. 224 Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 613 per 225 Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 655 per 226 Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 661 per 227 Clunies-Ross v The Commonwealth (1984) 155 CLR 193 at 202 per Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ. A precursor to this proposition, which has been repeatedly approved, is found in Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 276. freedoms referred to'"228. Thus Dixon J said229: "the paragraph should be given as full and flexible an operation as will cover the objects it was designed to effect." The liberality to be employed in the construction of s 51(xxxi) extends to each of its integers, not just one or two. "Property" is to be liberally construed230. But so is "acquisition"231. So is the expression "just terms"232. What is more, s 51(xxxi) must be construed as a whole. Construction of s 51(xxxi) as a whole. In Grace Brothers Pty Ltd v The Commonwealth233 Dixon J said that s 51(xxxi) is "an express grant of specific power". He also said of the phrase "on just terms" that it "forms part of the definition of the power." He continued: "The legislative power given by s 51(xxxi) is to make laws with respect to a compound conception, namely, 'acquisition-on-just-terms.' 'Just terms' doubtless forms a part of the definition of the subject matter, and in that sense amounts to a condition which the law must satisfy. But the question for the Court when validity is in issue is whether the legislation answers the description of a law with respect to acquisition upon just terms." 228 Street v Queensland Bar Association (1989) 168 CLR 461 at 527 per Deane J; [1989] HCA 53. He was quoting Minister of Home Affairs v Fisher [1980] AC 319 229 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349. 230 See, for example, Re Director of Public Prosecutions; Ex parte Lawler (1994) 179 CLR 270 at 285 n 62; Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 303; Smith v ANL Ltd (2000) 204 CLR 493 at 231 Re Director of Public Prosecutions; Ex parte Lawler (1994) 179 CLR 270 at 285; Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 303 n 16; Smith v ANL Ltd (2000) 204 CLR 493 at 533 [119]. 232 Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 310-311; Smith v ANL Ltd (2000) 204 CLR 493 at 533 [120]. 233 (1946) 72 CLR 269 at 290. See also Trade Practices Commission v Tooth & Co Ltd (1979) 142 CLR 397 at 417; Mutual Pools & Staff Pty Ltd v The Commonwealth (1994) 179 CLR 155 at 219; Re Director of Public Prosecutions; Ex parte Lawler (1994) 179 CLR 270 at 285; Smith v ANL Ltd (2000) 204 CLR 493 at 512 [48] and 520 [76]. In Re Director of Public Prosecutions; Ex parte Lawler234 Deane and Gaudron JJ said of the expression "acquisition of property on just terms": "That phrase must be read in its entirety and, when so read, it indicates that s 51(xxxi) applies only to acquisitions of a kind that permit of just terms. It is not concerned with laws in connexion with which 'just terms' is an inconsistent or incongruous notion. Thus, it is not concerned with a law imposing a fine or penalty, including by way of forfeiture, or a law effecting or authorizing seizure of the property of enemy aliens or the condemnation of prize. Laws of that kind do not involve acquisitions that permit of just terms and, thus, they are not laws with respect to 'acquisition of property', as that expression is used in s 51(xxxi)." (emphasis added) The idea that persons possessing entitlements to take water pursuant to licences granted under statutory power should not those entitlements by governmental compulsion unless they are given just terms is not an inconsistent or incongruous notion. lose Property. The word "property" in s 51(xxxi) is "the most comprehensive term that can be used."235 Rich J said236: "What we are concerned with is not a private document creating rights inter partes, but a Constitution containing a provision of a fundamental character designed to protect citizens from being deprived of their property by the Sovereign State except upon just terms. The meaning of property in such a connection must be determined upon general principles of jurisprudence, not by the artificial refinements of any particular legal system or by reference to Sheppard's Touchstone. The language used is perfectly general. It says the acquisition of property. It is not restricted to acquisition by particular methods or of particular types of interests, or to particular types of property. It extends to any acquisition of any interest in any property." 234 (1994) 179 CLR 270 at 285. See also Mutual Pools & Staff Pty Ltd v The Commonwealth (1994) 179 CLR 155 at 219-220; The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 68 [179] and 90-91 [237]; Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 304 [517]; Smith v ANL Ltd (2000) 204 CLR 493 at 550 [176]. 235 The Commonwealth v New South Wales (1923) 33 CLR 1 at 21 per Knox CJ and Starke J; [1923] HCA 34. 236 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 284-285. So the taking merely of a right to possession was an acquisition of property. In the same case Starke J said237: "Property, it has been said, is nomen generalissimum and extends to every species of valuable right and interest including real and personal property, incorporeal hereditaments such as rents and services, rights of way, rights of profit or use in land of another, and choses in action. And to acquire any such right is rightly described as an 'acquisition of property.'" Four years later Dixon J said238: "[Section] 51(xxxi) is not to be confined pedantically to the taking of title by the Commonwealth to some specific estate or interest in land recognized at law or in equity and to some specific form of property in a chattel or chose in action similarly recognized, but … extends to innominate and anomalous interests and includes the assumption and indefinite continuance of exclusive possession and control for the purposes of the Commonwealth of any subject of property." Hence "one should lean towards a wider rather than narrower concept of property, and look beyond legal forms to the substance of the matter."239 Examples of the width may be seen in the inclusion of common law native title rights240, broadcasters' information242 within licences241 and confidential "property". Acquisition. Termination of property is not enough to attract s 51(xxxi). Nor is destruction of property. Nor is interference with property. "[T]here must 237 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 290. 238 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349. 239 Smith Kline & French Laboratories (Aust) Ltd v Secretary, Department of Community Services and Health (1990) 22 FCR 73 at 121 per Gummow J. 240 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 110-111; Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 613 (pointing out, however, the inherent susceptibility of native title to defeasance by the grant of freehold or other estates inconsistent with it); cf at 560. 241 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 166 and 198-199; [1992] HCA 45. 242 Smith Kline & French Laboratories (Aust) Ltd v Secretary, Department of Community Services and Health (1990) 22 FCR 73 at 120-122. be an acquisition whereby the Commonwealth or another[243] acquires an interest in property, however slight or insubstantial it may be."244 However, given that even a slight acquisition of property will suffice, if "there is a receipt, there is no reason why it should correspond precisely with what was taken."245 It has been said that this "is particularly so with 'innominate and anomalous interests'."246 "[T]here does not need to be correspondence either in appearance, value or characterisation between what has been lost and what may have been acquired. Indeed what has been acquired may often be without any analogue in the law of property and incapable of characterisation according to any established principles of property law."247 Where legislation provided for nominees of the Treasurer and the Commonwealth Bank to be placed in control of the property and activities of other banks, leaving shareholders only with their entitlement to dividends "if the nominees see fit to declare any"248 and their entitlement as contributories on a 243 It is now well established, and the contrary was not submitted, that s 51(xxxi) applies to acquisitions by persons other than the Commonwealth: Jenkins v The Commonwealth (1947) 74 CLR 400 at 406; [1947] HCA 41; McClintock v The Commonwealth (1947) 75 CLR 1 at 23 and 36; [1947] HCA 39; P J Magennis Pty Ltd v The Commonwealth (1949) 80 CLR 382 at 401-402, 411 and 423; [1949] HCA 66; Trade Practices Commission v Tooth & Co Ltd (1979) 142 CLR 397 at 403, 407, 426-427 and 451-452; Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 510-511 and 526; Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 595; Smith v ANL Ltd (2000) 204 CLR 493 at 506 [27]. 244 The Commonwealth v Tasmania (1983) 158 CLR 1 at 145 per Mason J (emphasis added). See also, for example, Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 304. Cf Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349; Smith v ANL Ltd (2000) 204 CLR 493 at 545-547 [164]-[168]. Since the proposition was not challenged in these proceedings, it is inappropriate to examine its validity. 245 Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 305 per Mason CJ, Deane and Gaudron JJ. See also Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 634. 246 Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 305 per Mason CJ, Deane and Gaudron JJ, quoting Dixon J in Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349. 247 Smith v ANL Ltd (2000) 204 CLR 493 at 542 [157] per Callinan J (footnote omitted). 248 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 348. winding up, Dixon J said that the "company and its shareholders are in a real sense, although not formally, stripped of the possession and control of the entire undertaking."249 If the question is whether the loss of property is to be examined in a "real sense", the question whether that loss entails acquisition must be examined in the same fashion. Hence, Dixon J said, s 51(xxxi) extends to "a circuitous device to acquire indirectly the substance of a proprietary interest"250. "The protection which s 51(xxxi) gives to the owner of property is wide. It cannot be broken down or avoided by indirect means."251 The legislature cannot "achieve by indirect or devious means what s 51[(xxxi) does] not allow to be done directly."252 Just terms. In assessing whether terms are just, the courts will give the Parliament "a measure of latitude"253. But, at least on one line of authority, the legislation "must provide for the claimant receiving the full value of his property"254 – "adequate compensation" or "full value"255. "When a person is deprived of property, no terms can be regarded as just which do not provide for payment to him of the value of the property as at date of expropriation, together with the amount of any damage sustained by him by reason of the expropriation, over and above the loss of the value of the property taken. The amount so 249 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349 (emphasis added). 250 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 349. See also Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 510. 251 British Medical Association v The Commonwealth (1949) 79 CLR 201 at 270 per Dixon J; [1949] HCA 44. 252 The Commonwealth v Tasmania (1983) 158 CLR 1 at 283 per Deane J, discussing Dixon J's statements in Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 350. 253 Smith v ANL Ltd (2000) 204 CLR 493 at 512 [48] per Gaudron and Gummow JJ. 254 Australian Apple and Pear Marketing Board v Tonking (1942) 66 CLR 77 at 85 per Williams J; [1942] HCA 37. See also Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 310-311. 255 Australian Apple and Pear Marketing Board v Tonking (1942) 66 CLR 77 at ascertained is no more than the just equivalent of the property of which he has been deprived."256 Section 51(xxxi): were the bore licences property? The plaintiffs' argument: common law proprietary rights? The plaintiffs argued that the legislative regime affecting water in New South Wales did not create rights sourced only in statute; that it was merely a regulation of a common law right to extract water; and that that common law right was a proprietary interest in land. That argument must be rejected. From 1930, ss 112, 115 and 116 of the Water Act 1912 followed earlier enactments providing for bore licences permitting the sinking, enlarging, deepening or alteration of bores. From 1955, s 115A required all bores to be licensed. In 1966 sub-surface water was vested in the State of New South Wales by the insertion of s 4B(1) into the Water Act 1912257. It provided that the "right to the use and flow and to the control of all sub-surface water shall vest in the Commission for the benefit of the Crown …". (In 1986 that right vested in the Water Administration Ministerial Corporation ("the Ministerial Corporation"): s 12(1) of the Water Administration Act 1986 (NSW).) Section 4C provided that no person was to interfere with sub-surface water or obstruct its flow except in accordance with the provisions of the Act or with the written consent of the Commission. And s 117A gave power to the Commission to restrict or control the rate of flow or pumping or the manner of extraction of water from bores in a restricted sub-surface water area258. In 1984 the Lower Lachlan Groundwater System was declared to be a restricted sub-surface water area. From 1997 all bore licences other than those used for domestic and stock requirements were subjected to conditions imposed under s 116C limiting the amount of water to be extracted and permitting a variation of the amount allocated or the rate of extraction. Hence while bore licences gave rights, from 1966 on they were rights operating by way of an exemption from a general prohibition through s 4C on extracting groundwater which had been vested in the Commission for the benefit of the Crown by s 4B. They were rights which were created by the legislature. They were subject to conditions imposed by the legislature. It is true that they derived from, and had close but far from complete resemblances with, the right 256 The Commonwealth v Huon Transport Pty Ltd (1945) 70 CLR 293 at 306-307 per Rich J; [1945] HCA 5. 257 See [108] n 112. 258 See [108] n 113. of landowners at common law to abstract water percolating or running beneath the surface of the land. Like the common law right of landowners, although the right of bore licensees did not give a right of ownership in groundwater, it did give a right to abstract it if it was there259. The resemblances are far from complete because the bore licences were highly regulated. But at least from 1966, although the rights conferred by bore licences derived from those recognised at common law, it cannot be said that any common law right has survived. Statutory proprietary rights. However, although the bore licences were not common law rights, they were a form of property. Lord Wilberforce said in National Provincial Bank Ltd v Ainsworth260: "Before a right or an interest can be admitted into the category of property, or of a right affecting property, it must be definable, identifiable by third parties, capable in its nature of assumption by third parties, and have some degree of permanence or stability." He was speaking in relation to a problem different from the present, but his words have been applied in many contexts in this Court261, including the context of s 51(xxxi)262. A bore licence was definable. It was identifiable by third parties. It had a considerable degree of permanence and stability. Once granted, it could not be terminated, except for cause, before its lapse or expiry263. The Ministerial Corporation was under a duty to renew it on payment of the prescribed fee264. And it was capable of assumption by third parties – either by transfer with the land to which it was connected or by transfer separately from that land. 259 Ballard v Tomlinson (1885) 29 Ch D 115 at 120-121. See generally Getzler, A History of Water Rights at Common Law, (2004). 260 [1965] AC 1175 at 1247-1248. Something can be property without being assignable, but "the want of assignability of a right is a factor tending against the characterization of a right as property": Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 166 per Brennan J. 261 Eg R v Toohey; Ex parte Meneling Station Pty Ltd (1982) 158 CLR 327 at 342; [1982] HCA 69. 262 Smith v ANL Ltd (2000) 204 CLR 493 at 554-555 [190]. 263 The bore licences could not be cancelled except for breach of condition: Water Act 1912, ss 116(2) and 117H. 264 Water Act 1912, s 116(1). The Water Act 1912, s 117, provides: "A licence shall be deemed to be held by and shall operate for the benefit of the lawful occupier for the time being of the land whereon the bore is sunk or is proposed to be sunk." It follows that as one occupier who owned the land sold to another, the licence passed to the new owner. That proposition is also assumed by s 117K, introduced in 1997. Further, the Valuation of Land Act 1916 (NSW), s 6A(3), provides that in determining the land value of any land in relation to which there was a water right, the land value shall include the value of the right, and it shall be assumed that the right shall continue to apply in relation to the land. A "water right" is defined in s 4(1) as meaning a right or authority (however described) under the Water Management Act 2000, the Water Act 1912 or any other Act, being a right or authority to construct, install or use works of irrigation, or to use water supplied by works of irrigation. The expression "water right" thus includes the rights conferred by bore licences. But a licence could be transferred even if the land was not. In 1997, s 117J was inserted into the Water Act 1912. It applied to sub-surface water basins which the Ministerial Corporation had determined to be subject to it: s 117J(1). It permitted the holders of licences in relation to those sub-surface water basins to transfer the whole or part of the water allocation for the licence to any other person, whether or not that person was the holder of another licence: s 117J(1) and (2). The power to transfer depended on approval of the Ministerial Corporation: s 117J(2). Conditions could be imposed on that approval: s 117J(11). Transfers could be temporary or permanent: s 117J(3). A temporary transfer was for a period determined by the Ministerial Corporation, after which time the transferred water allocation reverted to the transferor: s 117J(3)(a). If the transfer were permanent, the transferor's rights to take and use the water concerned were cancelled on completion of the transfer: s 117J(3)(b). If the Ministerial Corporation approved the transfer, s 117J(10) provided that it could give effect to the transfer in one or more of three ways: by making such adjustments with respect to the transferor's and transferee's water allocations as the Ministerial Corporation considers appropriate, if the whole of the transferor's water allocation is being transferred, by cancelling the transferor's licence, if the transferee does not hold a licence, by issuing a licence to the transferee in accordance with this Part and including the transferred water allocation in the conditions of the licence." If the Ministerial Corporation acted under s 117J(10)(a) or (b), the transfer transaction was in substance an assignment. If the Ministerial Corporation acted under s 117J(10)(c), the transfer transaction was in substance a novation. The Solicitor-General of the Commonwealth contended that s 117J gave only a limited capacity to transfer water allocations. The contention was advanced as part of an argument that the aquifer access licences granted in 2008 are "far more readily tradeable." The contention did not face up to the fact that whether or not the aquifer access licences are more tradeable, much trading took place before 2008 in the bore licences. On 15 October 2003 the Ministerial Corporation determined that s 117J should apply to (inter alia) the Lower Lachlan groundwater management zone. Between that time and 2007, a total of 74 temporary transfers took place in the Lower Lachlan Groundwater System, each of them for valuable consideration. Not only were bore licences transferable with the land, not only was their value taken into account in determining the value of the land to which they were attached, and not only were bore licences transferable separately from the land, but they were also commonly taken into account, together with the land, by lenders in securing loans to the owner or occupiers of the land, and they were provided to the lenders as part of the security. Thus in the case of the operations conducted on the plaintiffs' properties, the bore licences were part of the security given to banks from time to time for monies advanced in relation to the conduct of the businesses conducted on those properties. There has been legislative recognition of that practice of using bore licences as security for loans. Schedule 10 to the Water Management Act 2000 deals with the conversion of bore licences to access licences and approvals. Clause 2 of Sched 10 defines "entitlement" as meaning, inter alia, "a licence referred to in Part 5" of the Water Act 1912 – that is, the plaintiffs' bore licences were entitlements. Clause 19(1) provides that a "person who, immediately before the appointed day, had an interest in an entitlement (being an interest in the nature of a security interest) is taken to have an equivalent security interest in the replacement access licence." Clause 19(2) provides that if the interest in the entitlement arose from a mortgage over land, "the equivalent security interest in the access licence is taken to be a mortgage over the replacement access licence." The legislation thus assumes the legality of using bore licences as security for loans before 2008. That the plaintiffs' bore licences had value is suggested by the fact that they could be taken into account in valuing the licensee's land, sold and mortgaged. But from 1998 they were likely to have increased in value, because in that year they became a finite resource. Pursuant to s 113A of the Water Act 1912, the whole of the Lower Lachlan Groundwater System was declared a water shortage zone. The consequence is that no applications for new bore licences creating additional entitlements were accepted after 23 October 1998. This added value to the plaintiffs' land, since, according to the Special Case, after 1998 "purchasers of irrigable land would pay more for land which had bore licences in respect of bores sunk in that land if those licences enabled significant areas of the land to be irrigated." that reasoning advanced by the Solicitor-General of Right inherently susceptible to modification or adjustment. The principal answer the Commonwealth was that the right conferred by a bore licence under the Water Act 1912 was "so slight or insubstantial" that it did not constitute "a proprietary interest". The quoted language is that of Black CJ and Gummow J in Minister for Primary Industry and Energy v Davey265, on which the Solicitor-General relied. That language is inapplicable to this case. That is because their Honours illustrated what they had in mind by referring to Mason J's judgment in R v Toohey; Ex parte Meneling Station Pty Ltd266. He held that the holder of a grazing licence under the Crown Lands Act (NT) did not have an estate or interest in land. The licence lacked the "degree of permanence" quality referred to by Lord Wilberforce, because it could be cancelled by the Minister, "the only pre-condition being that he give three months' notice in writing of his intention to do so."267 And the licence was not "capable in its nature of assumption by third parties" because it was not assignable268. Bore licences stood in contrast to that grazing licence. As noted above, they could not be cancelled except for breach of a condition269 and the Ministerial Corporation had a duty to renew them on payment of the prescribed fee270. And they could be assigned271. The Solicitor-General of the Commonwealth contended that the plaintiffs' rights under the bore licences were inherently susceptible of modification or 265 (1993) 47 FCR 151 at 165. 266 (1982) 158 CLR 327. 267 (1982) 158 CLR 327 at 342. 268 (1982) 158 CLR 327 at 343, quoting Lord Wilberforce in National Provincial Bank Ltd v Ainsworth [1965] AC 1175 at 1248. 269 See above at [197] n 263. 270 See above at [197]. 271 See above at [200]. extinguishment, because they could be modified without legislative action – merely by reduction of the amount of water which the plaintiffs were entitled to extract from their bores. He submitted that they were thus afflicted by a "congenital infirmity"272 which was even "more pressing than the statutory in Health Insurance Commission v Peverill273, The rights" considered Commonwealth v WMC Resources Ltd274 and Attorney-General (NT) v Chaffey275. The Solicitor-General referred to the restrictions imposed from 1984 onwards and to the capacity to vary the volumetric allocation or the rate conferred by a condition in the licences276. In assessing this submission, some key characteristics of the bore licences must be borne in mind. Not only were the bore licences renewable, non-cancellable and transferable. Not only could the water allocations under the bore licences not be reduced at will. But they had other relevant characteristics as well. Callinan J said, speaking of exploration permits granted under a statutory power, that it was relevant to the application of s 51(xxxi) that "the permittee would have incurred expense in obtaining, holding or exploiting the permit"277. Kirby J saw as material factors whether the relevant interest could be said to "require substantial investment" or "impose significant obligations"278. These ideas are material to the bore licences. Bore licensees were persons who in some cases had paid consideration for a transfer; in all cases had paid fees; in all cases were entitled to rely on the licences as increasing the value of their land; in many cases were obliged, in order to maintain the licences, to sink bores; in many cases relied on the licences as having sufficient practical content to justify 272 The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 75 [203] per Gummow J, quoting Hughes CJ, giving the opinion of the majority of the Court in Norman v Baltimore & Ohio Railroad Co 294 US 240 at 307-308 (1935): "Contracts, however express, cannot fetter the constitutional authority of the Congress. Contracts may create rights of property, but when contracts deal with a subject matter which lies within the control of the Congress, they have a congenital infirmity. Parties cannot remove their transactions from the reach of dominant constitutional power by making contracts about them." 273 (1994) 179 CLR 226. 274 (1998) 194 CLR 1. 275 (2007) 231 CLR 651; [2007] HCA 34. 276 See above at [195]. 277 Smith v ANL Ltd (2000) 204 CLR 493 at 544 [163]. 278 The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 99 [253]. investment by sinking bores, introducing and maintaining equipment capable of extracting water from those bores, developing surface irrigation channels, and buying overhead sprinkler systems (in the case of the first two plaintiffs, $7.5 million worth); in many cases had used the licences as security for loans; and in that respect had dealt with lenders who were entitled to have relied in good faith on the continuation of the licences. The Solicitor-General submitted that the plaintiffs did not have any right to "an immutable quantity of water." That is true. But the Solicitor-General's argument goes too far. The argument was that conditions could be imposed, and powers exercised pursuant to them, which were not constrained by such considerations as "scarcity, fair distribution amongst water users or by environmental considerations". That argument does not deal with the factors just referred to. Considerations like scarcity, fair distribution and environmental considerations corresponded with express powers in the Water Act 1912, such as, for example, s 117A(3)(a)(i), (iii) and (iv) (quantities), s 117A(3)(a)(ii) (protecting water quality and preventing pollution or contamination), and s 117E (restricting the entitlement of licensees in order to prevent shortfalls in meeting the requirements of licensees). Even if the powers conferred by licence conditions could extend beyond scarcity, fair distribution and environmental considerations, they could not extend so widely as to give New South Wales officials an uncontrolled discretion to reduce allocations at will. Indeed the Solicitor-General submitted that the officials "would be able to have regard to a broad range of public interest considerations and would be subject to relatively few constraints". There are concessions inherent in that submission. Another way of putting the matter is to say that the officials were subject to the constraints imposed by the public interest considerations to which they were obliged to have regard. Thus the powers did not render the bore licences so "slight" or "insubstantial", or so "inherently susceptible to modification or extinguishment", that they were incapable of being property. The breadth of the powers might affect the value of the property, but they were not so broad as to prevent it being categorised as property. The Solicitor-General of the Commonwealth did not appeal directly to analogies with the three cases on infirm statutory rights to which he referred. However, any appeal of that kind must fail. The earliest of the three cases was Health Insurance Commission v Peverill279. Different members of the Court gave different reasons for not striking down legislation reducing benefits to medical practitioners. The reasons 279 (1994) 179 CLR 226. most closely in point are those of Mason CJ, Deane and Gaudron JJ in the following passage280: receive payments "It is significant that the rights that have been terminated or diminished are statutory entitlements from consolidated revenue which were not based on antecedent proprietary rights recognized by the general law. Rights of that kind are rights which, as a general rule, are inherently susceptible of variation. That is particularly so in the case of both the nature and quantum of welfare benefits, such as the provision of medicare benefits in respect of medical services. Whether a particular medicare benefit should be provided and, if so, in what amount, calls for a carefully considered assessment of what services should be covered and what is reasonable remuneration for the service provided, the nature and the amount of the medicare benefit having regard to the community's need for assistance, the capacity of government to pay and the future of health services in Australia. All these factors are susceptible of change so that it is to be expected that the level of benefits will change from time to time. Where such change is effected by a law which operates retrospectively to adjust competing claims or to overcome distortion, anomaly or unintended consequences in the working of the particular scheme, variations in outstanding entitlements to receive payments under the scheme may result. In such a case, what is involved is a variation of a right which is inherently susceptible of variation and the mere fact that a particular variation involves a reduction in entitlement and is retrospective does not convert it into an acquisition of property." There is no analogy between the bore licences and the statutory rights of medical practitioners considered in that case. And the reasoning suggests that "rights … inherently susceptible of variation" do not comprise a large category. In the second case, The Commonwealth v WMC Resources Ltd281, the four members of the majority gave divergent reasons for not holding invalid legislation altering rights under a permit to explore the continental shelf. Brennan CJ's reasoning did not turn on the present point. Gaudron J held that the legislation "simply modified a statutory right which had no basis in the general law and which was inherently susceptible to that course"282. The rights of the bore licensees in the present case rested on a statute which did have a basis in the general law in the sense that it derived from and modified it. McHugh J held that the provisions of the legislation themselves indicated the possibility of 280 (1994) 179 CLR 226 at 237. 281 (1998) 194 CLR 1. 282 (1998) 194 CLR 1 at 38 [86]. amendment283. That was the ground of Gummow J's decision as well284. The Solicitor-General of the Commonwealth did not in the present case point to any formula equivalent to those which were relied on by McHugh and Gummow JJ in the WMC Resources Ltd case. The third case to which the Solicitor-General referred, Attorney-General (NT) v Chaffey285, is similar to Health Insurance Commission v Peverill: the nature of a worker's rights under workers' compensation legislation made those rights liable to variation by legislative amendment in order to adjust and ensure the continuing operation of the scheme over long periods of time during which economic and commercial conditions were likely to fluctuate286. The Solicitor-General of the Commonwealth also argued that by 2008 the bore licensees' rights under the Water Act 1912 were inherently susceptible of variation under the Water Management Act 2000 in the way contemplated by the Funding Agreement. But nothing can turn on whether the Water Management Act 2000 existed antecedently to expropriation or came into force at the same time. The Solicitor-General for New South Wales advanced two arguments not put by the Commonwealth. One was that the "main economic value" of the bore licences only arose when New South Wales decided to restrict the grant of further entitlements after 1998. The Special Case Book contains nothing directly supporting that conclusion; and even if it were correct, that does not take from the bore licences the indicia of property which they possessed just before they were expropriated in 2008. The other argument advanced by the Solicitor- General for New South Wales was that the New South Wales Government could have achieved its goal of preserving groundwater by reducing allocations pursuant to the conditions in the bore licences. Perhaps it could have; but the 283 (1998) 194 CLR 1 at 56-57 [146]. He also said at 56 [145] that the rights of the permit holder, having been created by a federal statute under s 51(xxix) of the Constitution, were always liable to amendment by legislation enacted under s 51(xxix). That broad approach has never attracted much support. See Attorney-General (NT) v Chaffey (2007) 231 CLR 651 at 664 [24] and Telstra Corporation Ltd v The Commonwealth (2008) 234 CLR 210 at 232 [49]. 284 (1998) 194 CLR 1 at 73-75 [198]-[203]. 285 (2007) 231 CLR 651. 286 There was no challenge to the correctness of the reasoning in the three cases just discussed, and hence it is not necessary to consider the merits of various criticisms made by Callinan J of some aspects of the first two in Smith v ANL Ltd (2000) 204 CLR 493 at 552-555 [182]-[193]. question is whether the course it actually took is legally sound, not whether another course which it did not take was legally sound. Accordingly the contention that the bore licences were not property on the ground that they conferred only rights which were inherently susceptible to modification or adjustment must be rejected. Acquisition: adjusting or regulating competing rights, claims and obligations The next submission of the Solicitor-General of the Commonwealth assumed, contrary to his primary position, that the bore licences were property. The argument was that the National Water Commission Act 2004, in its operation in conjunction with the Funding Agreement, was not directed at the acquisition of property as such. Rather, he said, in the words of Deane and Gaudron JJ in Mutual Pools & Staff Pty Ltd v The Commonwealth287, it fell into a category: "of laws which provide for the creation, modification, extinguishment or transfer of rights and liabilities as an incident of, or a means for enforcing, some general regulation of the conduct, rights and obligations of citizens in relationships or areas which need to be regulated in the common interest."288 (emphasis added) The Solicitor-General submitted that the object of the Funding Agreement was to assist in reducing the level of licence holders' entitlements, including entitlements in the Lower Lachlan Groundwater System, with the goal of achieving long-term sustainable water use. It was part of an effort by the 287 (1994) 179 CLR 155 at 189-190. 288 The principal cases he cited were the following. The first was Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 510 per Mason CJ, Brennan, Deane and Gaudron JJ, where the doctrine is stated as turning on "a genuine adjustment of the competing rights, claims or obligations of persons in a particular relationship or area of activity". This statement was a dictum, uttered without specific citation of authority supporting the doctrine in terms, although there is at least one precursor, The Commonwealth v Tasmania (1983) 158 CLR 1 at 283, a case not relied on by the Solicitor-General. The other cases relied on were Mutual Pools & Staff Pty Ltd v The Commonwealth (1994) 179 CLR 155 at 171-172, 177-178 and 189-190; Health Insurance Commission v Peverill (1994) 179 CLR 226 at 236-237; Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 307; Nintendo Co Ltd v Centronics Systems Pty Ltd (1994) 181 CLR 134 at 161; [1994] HCA 27; and Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 298-300 [497]-[503] and 304-305 [517]-[519]. recently for groundwater. for surface water, more Commonwealth Government, State Governments and Territory Governments to achieve that goal. It was an effort which had been underway for some time, The particularly Solicitor-General pointed to the fact that between 2000 and 2002 the relevant New South Wales Minister constituted water management areas under s 11 of the Water Management Act 2000, one of which included the Lower Lachlan Groundwater System; and to the fact that the Minister directed the formulation of draft Water Sharing Plans for areas including the Lower Lachlan Groundwater System. He submitted that during that process it was determined that the total value of entitlements conferred by bore licences in each of the "Major New South Wales Groundwater Systems" either exceeded the average volume of water returned to the system each year or exceeded the amount that could be extracted from the system without causing damage to dependent ecosystems or surface water sources. It was also determined by the New South Wales Government that total entitlements should be reduced to ensure that the total volume extracted annually from each of the Major New South Wales Groundwater Systems was below those levels. Initially the New South Wales Government proposed to reduce entitlements on an "across the board basis". However, in March 2004 it decided to apply a "history of extraction methodology". From then on the New South Wales Government took steps towards obtaining Commonwealth funding for financial assistance to affected bore licence holders in a fashion which led to the Funding Agreement. The Solicitor-General submitted that there was an obvious common or public interest in seeking to ensure that groundwater extraction is limited to what is available to be extracted on an ongoing basis without causing environmental harm. He submitted that by seeking to provide that groundwater extraction takes place on the same basis as surface water extraction, the Funding Agreement recognises the fact that there is a relationship between the availability of surface water and the use of groundwater. Adopting the approach of Deane and Gaudron JJ quoted above in Mutual Pools & Staff Pty Ltd v The Commonwealth289, he submitted that the "need" for the regulation effectuated is even more apparent since average annual rainfall in most parts of New South Wales has been declining over time. The doctrine on which the Solicitor-General relied has been subjected to several criticisms by Callinan J, at least some of which have, with respect, considerable power290. But the plaintiffs did not contend that that doctrine was wrong, and hence there is no occasion to examine its correctness. They did, however, contend that the doctrine should be narrowly construed. The vague and 289 (1994) 179 CLR 155 at 189-190: see [216]. 290 Smith v ANL Ltd (2000) 204 CLR 493 at 550-552 [178]-[181], particularly the criticism that the doctrine is "inconsistent with the long established principle that s 51(xxxi) is a constitutional guarantee": see [185] above. undeveloped character of the doctrine does call for caution in considering its application. It is one thing to reason that since s 51 confers legislative powers to work forfeitures of prohibited imports (for example, s 51(i)), or provide for the disposition of a bankrupt's property (s 51(xvii)), or enact statutes relating to enemy property (for example, s 51(vi)), it is inappropriate to characterise laws of that kind as involving acquisitions of property on other than just terms, since the notion of "just terms" is simply inconsistent with the specific power291. It is another thing to do what Mason CJ did in Mutual Pools & Staff Pty Ltd v The Commonwealth292. He selected legislation enacted pursuant to these powers as mere examples of a wide genus of statutes which provide: "a means of resolving or adjusting competing claims, obligations or property rights of individuals as an incident of the regulation of their relationship, eg, the relationship between a bankrupt and the creditors in 291 Different kinds of argument have been advanced to support the conclusion that s 51(xxxi) does not apply in these circumstances. Some were put by Aickin J in Trade Practices Commission v Tooth & Co Ltd (1979) 142 CLR 397 at 453-457. One is that the forfeiture of prohibited imports, like fines and penalties, would not be described either in 1900 or 1979 as "acquisition of property": at 455. Another is that the seizure of enemy property, as analysed by Dixon CJ and Taylor J in Attorney-General (Cth) v Schmidt (1961) 105 CLR 361; [1961] HCA 21, is not acquisition of the beneficial ownership, because it leaves that matter for later decision. Aickin J commented at 456-457: "Some provision was at least desirable for the preservation of the property or its equivalent during the progress of the war, so that it might await both the result of the war itself and a determination, by a variety of means including perhaps a final peace treaty, of the matters to be dealt with by international agreements. Beneficial ownership was in effect suspended throughout the period of the war and then dealt with pursuant to the international arrangements referred to in the judgments. … No doubt for the time being the enemy nationals lost control of their property though it was not vested beneficially in anyone else." Aickin J saw the proper analogy as being with forfeiture: at 455-457. And taking the property of a bankrupt in order to pay those creditors whom the bankrupt ought to have paid earlier and then pay the bankrupt the surplus (if any) is not to make an acquisition: Walker, "The Constitutional Protection of Property Rights: Economic and Legal Aspects", in James (ed), The Constitutional Challenge: Essays on the Australian Constitution, Constitutionalism and Parliamentary Practice, (1982) 135 at 153 (discussing an intervention in argument by Barwick CJ in the Tooth case). 292 (1994) 179 CLR 155 at 171. the bankruptcy, between the Crown and the person who brings in prohibited imports, and between the Crown and an enemy alien with respect to enemy property." The doctrine appealed to speaks of general regulation of relationships independently of specific powers of the kinds just referred to. The doctrine appealed to cannot be given an extensive scope. "[M]uch of the business of government is the general regulation of the conduct, rights and obligations of citizens"293. A lot of this regulation affects property rights, and involves what may loosely be called an adjustment of competing rights, claims or obligations. Hence "it may not be easy"294 to draw a line between a law to which s 51(xxxi) applies and a law resolving competing claims which "need to be regulated", in the words of Deane and Gaudron JJ in Mutual Pools & Staff Pty Ltd v The Commonwealth295. What is more, to give the doctrine under discussion an extensive scope would be to erode the "constitutional guarantee" in s 51(xxxi) very deeply. That would make it merely a dignified rather than an efficient part of the Constitution. It would be decorative rather than significant. It would sink from being a constitutional guarantee to the depths of a purely formal provision. The language used in the authorities suggests that that outcome would be quite incorrect296. It is desirable to commence dealing with the Solicitor-General's arguments by examining his reliance on two authorities. One held that a fee for a commercial fishing licence was not an excise because it was "part of a system for preserving a limited public natural resource in a society which is coming to recognize that, in so far as such resources are concerned, to fail to protect may destroy and to preserve the right of everyone to take what he or she will may eventually deprive that right of all content."297 In the other authority it was said that legislation making it an offence to sell beer in a container which did not show the amount of the refund payable when the container was returned to a depot would be consistent with s 92 of the Constitution so long as any burden imposed on interstate trade was incidental and not disproportionate to the 293 Smith v ANL Ltd (2000) 204 CLR 493 at 551 [181] per Callinan J. See also at 514 [51] per Gaudron and Gummow JJ: "Many laws may be so described." 294 Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 299-300 [500] per Gummow J. 295 (1994) 179 CLR 155 at 190. 296 See above at [185]-[193]. 297 Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 325 per Mason CJ, Deane and Gaudron JJ; [1989] HCA 47. See also at 335-336. attempted solution to problems of litter and energy resource depletion298. These authorities were directed to constitutional problems quite different from that of assessing whether an "acquisition" for the purposes of s 51(xxxi) had taken place. They did not discuss s 51(xxxi) from any point of view. Further, there is no analogy between the present case and cases in which it has been held that there was no acquisition, only an adjustment or regulation of competing rights. Take first the instances referred to by Mason CJ in the passage from Mutual Pools & Staff Pty Ltd v The Commonwealth299 quoted above. The relationship between one bore licensee and another has no analogy with the relationships between bankrupts and their creditors, or the Crown and the owners of prohibited goods which have been seized, or the Crown and those owning enemy property. Nor is there any analogy with the relationships over time between injured workers, employers and workers' compensation insurers300, or between patients, medical practitioners, the government and taxpayers301. There is no analogy with statutory liens on aircraft to secure the payment by owners, lessees or operators of aircraft of monies owing for services rendered which was necessary for commercial operations by the aircraft to take place302. And there is no analogy with the primary case which the Solicitor-General relied on, Nintendo Co Ltd v Centronics Systems Pty Ltd303. The legislation considered in that case was enacted pursuant to the power in s 51(xviii) of the Constitution to make laws with respect to copyrights. The legislation conferred an exclusive right of commercial exploitation of certain intellectual property in return for payment of a fee to the owner of the property. One ground assigned by six Justices for treating the legislation as being outside s 51(xxxi) was that it could not be: "characterized as a law with respect to the acquisition of property for the purposes of [s 51(xxxi)]. Its relevant character is that of a law for the adjustment and regulation of the competing claims, rights and liabilities of 298 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 473-474 and 479; [1990] HCA 1. 299 (1994) 179 CLR 155 at 171: see [218]. 300 Attorney-General (NT) v Chaffey (2007) 231 CLR 651. 301 Health Insurance Commission v Peverill (1994) 179 CLR 226. 302 Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 300 [501] and 304-305 [519]. 303 (1994) 181 CLR 134 at 161. the designers or first makers of original circuit layouts and those who take advantage of, or benefit from, their work."304 The legislation under consideration created new rights. The Justices said that it is "of the nature" of laws made under s 51(xviii) that they confer intellectual property rights on "authors, inventors and designers, other originators and assignees and that they conversely limit and detract from the proprietary rights which would otherwise be enjoyed by the owners of affected property. Inevitably, such laws may, at their commencement, impact upon existing proprietary rights."305 The new rights created by the legislation necessarily had an impact on the interests and rights of others and this called for adjustments to minimise the resulting conflicts306. There being no decisive assistance available by comparing the existing authorities considered as specific decisions with the present case, it is necessary to see whether any principle stated in them assists in resolving it. Is acquisition without just terms a means appropriate and adapted to achieve the legislative end? In Mutual Pools & Staff Pty Ltd v The Commonwealth307 Brennan J endeavoured to explain, among other things, the cases said to turn on "genuine adjustment of the competing rights, claims or obligations of persons in a particular relationship or area of activity"308. He said: "In each of the cases in which laws for the acquisition of property without the provision of just terms have been held valid, such an acquisition has been a necessary or characteristic feature of the means selected to achieve an objective within power, the means selected being appropriate and adapted to that end. Therefore a law which selects and enacts means of achieving a legitimate objective is not necessarily invalid because the means involve an acquisition of property without just terms. What is critical to validity is whether the means selected, involving an acquisition of property without just terms, are appropriate and adapted to 304 (1994) 181 CLR 134 at 161 per Mason CJ, Brennan, Deane, Toohey, Gaudron and 305 (1994) 181 CLR 134 at 160 per Mason CJ, Brennan, Deane, Toohey, Gaudron and 306 See The Commonwealth v WMC Resources Ltd (1998) 194 CLR 1 at 32 [63]. 307 (1994) 179 CLR 155 at 179-180. 308 Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 510 per Mason CJ, Brennan, Deane and Gaudron JJ. the achievement of the objective. The absence of just terms is relevant to that question, but not conclusive. Where the absence of just terms enhances the appropriateness of the means selected to the achievement of the legitimate objective, the law which prescribes those means is likely to fall outside s 51(xxxi) and within another supporting head of power. If it were otherwise, the guarantee of just terms would impair by implication the Parliament's capacity to enact laws effective to fulfil the purposes for which its several legislative powers are conferred." This way of putting the doctrine under consideration, like others, has been criticised as resting on the fallacy that a law can only have a single characterisation309. Further, in equating what is "necessary or characteristic" with what is "appropriate and adapted", particularly since "necessary" does not mean "indispensable"310, the test saps s 51(xxxi) of content in a manner inconsistent with its frequent recognition as an important constitutional guarantee311. Moreover, Brennan J's reasoning is difficult to apply to the present case. It is relatively easy to apply to heads of Commonwealth legislative power relating to Commonwealth activity, involving a comparison between a relatively confined head of power and the means employed. The reasoning is not so easy to apply in relation to laws enacted under s 51(xxxvi) with a view to making s 96 grants, for they relate to the financing of State activity, without limitation to relatively confined heads of Commonwealth power. This approach perhaps calls for an inquiry whether, assuming the Commonwealth had power to achieve the goals at which New South Wales was aiming, it can be said that the acquisition of property without just terms was a necessary or characteristic feature of the means prescribed. It was neither necessary312 nor characteristic. If licences constitute property rights, there is no inconsistency between acquiring them and paying just terms in the form of fair compensation. Another inquiry which this approach calls for is whether the legislative means selected by New South Wales, which involve non-payment of compensation as of right, are appropriate and adapted to the achievement of its objective in securing the future of a scarce resource. It is convenient from the point of view of New South Wales and its financial backer, the Commonwealth, not to pay compensation, but that does not render the means "appropriate and adapted". The scheme in question can proceed just as efficiently, though more expensively, if compensation is paid. There was no 309 Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 247-250 [333]-[339]. See also at 312 [543]. 310 Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 180 [98] per Gleeson CJ and Kirby J. 311 See [185] above. 312 See Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 654. submission, and it is not the case, that applying s 51(xxxi) to the current circumstances precludes the enactment of the legislation. Acquisition merely incidental to, consequential on or subservient to the legislative scheme. In Mutual Pools & Staff Pty Ltd v The Commonwealth313 Deane and Gaudron JJ explained the doctrine to which the Solicitor-General appeals thus: "A law falling within [this category] may, as an incident of its operation or enforcement, adjust, modify or extinguish rights in a way which involves an 'acquisition of property' within the wide meaning which that phrase bears for the purposes of s 51(xxxi). Yet, if such a law is of general operation, it is unlikely that it will be susceptible of being properly characterized … as a law with respect to the acquisition of property for a purpose in respect of which the Parliament has power to make laws. The reason why that is so is that, even though an 'acquisition of property' may be an incident or a consequence of the operation of such a law, it is unlikely that it will constitute an element or aspect which is capable of imparting to it the character of a law with respect to the subject matter of s 51(xxxi)." (emphasis added) Similarly, in the same case Mason CJ said314: "the Court has decided that acquisitions of various kinds, even though they might perhaps fall prima facie within the general power, are to be regarded as authorized by the exercise of specific powers otherwise than on the basis of just terms. Of these instances, it may be said that they are all cases in which the transfer or vesting of title to property or the creation of a chose in action was subservient and incidental to or consequential upon the principal purpose and effect sought to be achieved by the law so that the provision respecting property had no recognizable independent character." (emphasis added) These approaches, too, have been criticised as resting on the fallacy that a law can only have a single characterisation315. Putting that criticism on one side, the expropriation of bore licences was not a mere "incident" or "consequence" or "subservient" feature of the legislative scheme. It was at the heart of the scheme. The scheme could not have operated without a reduction in the entitlements of 313 (1994) 179 CLR 155 at 190. 314 (1994) 179 CLR 155 at 171. 315 Airservices Australia v Canadian Airlines International Ltd (1999) 202 CLR 133 at 247-250 [333]-[339]. See also at 312 [543]. bore licensees, and it depended on abolishing those entitlements and replacing them with different and lesser ones. Law not directed to acquisition of property "as such". The third formulation of the doctrine was put in Nintendo Co Ltd v Centronics Systems Pty Ltd316: "a law which is not directed towards the acquisition of property as such but which is concerned with the adjustment of the competing rights, claims or obligations of persons in a particular relationship or area of activity is unlikely to be susceptible of legitimate characterization as a law with respect to the acquisition of property for the purposes of s 51 of the Constitution." (emphasis added) However difficult the determination of what a law directed to the acquisition of property "as such" may be in some circumstances, it is not difficult here. The legislation acquiring the bore licences was directed towards the acquisition of property: they were its prime target. It was directed towards the acquisition of property in the bore licences "as such". Benefit as adjustment contrasted with identifiable and measurable advantage. In The Commonwealth v Tasmania317 Deane J said: "Difficult questions can arise when one passes from the area of mere prohibition or regulation into the area where one can identify some benefit flowing to the Commonwealth or elsewhere as a result of the prohibition or regulation. Where the benefit involved represents no more than the adjustment of competing claims between citizens in a field which needs to be regulated in the common interest, such as zoning under a local government statute, it will be apparent that no question of acquisition of property for a purpose of the Commonwealth is involved. Where, however, the effect of prohibition or regulation is to confer upon the Commonwealth or another an identifiable and measurable advantage or is akin to applying the property, either totally or partially, for a purpose of the Commonwealth, it is possible that an acquisition for the purposes of s 51(xxxi) is involved." Here, there is no analogy with zoning laws. In any event, a change in zoning laws normally effects no acquisition. And here, for reasons given below, the effect of the legislation was to confer upon "the Commonwealth or another", 316 (1994) 181 CLR 134 at 161. 317 (1983) 158 CLR 1 at 283. namely New South Wales, an identifiable and measurable advantage318. It was applied for a shared purpose of the Commonwealth and New South Wales. Non-application of doctrine. Finally, it is far from clear that when the doctrine is cautiously construed and applied independently of the authorities, its language applies to this case. The bore licensees were not making competing claims against each other. Nor did their rights compete with their or anyone else's obligations. Their rights put them in a position of competition with those who had no rights, but the changes made in 2008 did nothing in relation to the latter category of people. In a sense the bore licensees' rights were in competition among themselves because of the shortage of water. But the bore licensees were not in any "particular relationship". Nor were they, taken as a class, really in a single "area of activity". One farmer would pursue certain agricultural and pastoral activities. Another would pursue others. The fact that their pursuits may have had similarities does not make the behaviour of the farmers something conducted in a single area of activity beyond their attempt to sell their produce on Australian and world markets. If the doctrine applied in this case, it would apply to any class of traders having similar inputs and customers. So wide an application of the doctrine would, if sound, falsify the many descriptions in this Court of s 51(xxxi) as a guarantee stated in very broad language319. Acquisition generally The law. "On occasions the identification and valuation of what has been acquired may be difficult matters, but that an acquisition has occurred may not be denied by reason of those difficulties."320 A conclusion that there was an acquisition depends on the identification of some advantage accruing to New South Wales. In Mutual Pools & Staff Pty Ltd v The Commonwealth, Deane and Gaudron JJ said321: "it is possible to envisage circumstances in which an extinguishment, modification or deprivation of the proprietary rights of one person would involve an acquisition of property by another by reason of some identifiable and measurable countervailing benefit or advantage accruing to that other person as a result." 318 See [235] below. 319 See above at [185]. 320 Smith v ANL Ltd (2000) 204 CLR 493 at 543 [157] per Callinan J. 321 (1994) 179 CLR 155 at 185. In Georgiadis v Australian and Overseas Telecommunications Corporation322 Mason CJ, Deane and Gaudron JJ said that an acquisition would arise from the extinguishment of a cause of action by legislation if it conferred a "direct benefit" on the obligee. In Smith v ANL Ltd323 Callinan J took the reference to "direct benefit" as a sign of acquisition "to be capable of embracing advantages or benefits extending beyond and not necessarily of a proprietary kind in any conventional sense as understood by property lawyers." submissions. The defendants' The Solicitor-General of the Commonwealth submitted that while the plaintiffs' rights may have been modified or extinguished, New South Wales had not acquired them. Before 2008, New South Wales had the power to reduce the volume of water available to bore licensees. The reduction in entitlements in 2008 was a reduction to what was available. Hence the annual water volume reflected in the difference between the entitlements of the bore licensees and those of the aquifer access licensees is not available for use by anyone. The benefit gained by New South Wales is not water, but the serving of certain public interest purposes. These submissions must be rejected on three grounds. Control. The plaintiffs submitted that the necessary element of benefit or advantage accruing to New South Wales was that the expropriation caused it to regain complete control over water resources, namely the difference between the actual allocations under the bore licensees' entitlements and the allocations under the aquifer access licences. That submission is correct. In Bank of New South Wales v The Commonwealth Dixon J held that s 51(xxxi) applied because the legislation operated as an "assumption and indefinite continuance of exclusive … control … of" the relevant subject of property324. What were property rights in the plaintiffs' hands, to the extent to which they have been reduced, became in the hands of New South Wales rights of control. Extinguishment of liability. In The Commonwealth v WMC Resources Ltd, 322 (1994) 179 CLR 297 at 305. 323 (2000) 204 CLR 493 at 548 [173]. 324 (1948) 76 CLR 1 at 349. 325 (1998) 194 CLR 1 at 17 [16]. "If statutory rights were conferred on A and a reciprocal liability were imposed on B and the rights were proprietary in nature, a law extinguishing A's rights could effect an acquisition of property by B." Before the actions of the New South Wales Government in 2008, the bore licensees had rights to water, and New South Wales had a liability to ensure that they received it so far as there was water to be enjoyed, without interference from the Government of New South Wales. As stated earlier, and contrary to the present submissions of the Solicitors-General of the Commonwealth and for South Australia, the power of New South Wales to reduce the volume of water allocated to bore licensees was not an untrammelled one326. The existence of the bore licensees' rights entailed a liability in New South Wales not to interfere with them unlawfully. There was also a duty on the Ministerial Corporation to give notice in relation to the imposition of limitations and conditions on bore licences, to give a reasonable opportunity for written submissions, and to have regard to them: Water Act 1912, s 116C(2). Section 117H(2) made similar provision for a right to receive and a duty to give a hearing in relation to cancellation or suspension of licences for failure to comply with limitations or conditions of the licence, or any requirement imposed by or under Pt 5. The extinguishment of the bore licensees' rights relieved New South Wales of those liabilities. By the extinguishment of that liability, New South Wales obtained "relief from suit by the" holders of the bore licences327, and the obtaining of that relief was an acquisition of property by New South Wales. Contingent increase in capacity of New South Wales to take or grant rights to water. The arguments of the Solicitor-General of the Commonwealth rest on the assumption that if groundwater resources are to be employed sustainably, the allocations of 2008 will leave no surplus water available to New South Wales or anyone but the aquifer access licensees. That assumption rests on the estimations and predictions of experts in a field full of imponderables. The assumption may be correct, or over-optimistic, or over-pessimistic. Which of the three it is will not be known for many years. But to the extent that it turns out to be pessimistic, New South Wales will have gained something it did not have before 2008 – a capacity to take more water itself or to issue more rights to others without damaging the goal of sustainability. This capacity, if it turns out that it has been gained, will be a benefit or advantage which New South Wales has acquired within the meaning of s 51(xxxi). And the possibility that that capacity will be gained is a presently existing, direct and identifiable benefit or advantage accruing to New South Wales as a result of the extinguishment of the 326 See [208]. 327 Smith v ANL Ltd (2000) 204 CLR 493 at 545 [163] per Callinan J. bore licensees' rights, even though it may not be proprietary in a conventional sense: it is thus an acquisition of property by New South Wales. Section 51(xxxi): just terms Ex gratia "structural adjustment payments" were offered to the plaintiffs, to be funded by the payments to be made by the Commonwealth and New South Wales. The Solicitor-General of the Commonwealth accepted that these were not "just terms", on the ground that "just terms" must depend on law, not grace and favour. The defendants made important admissions on the pleadings to the effect that the sum of the value to the first and second plaintiffs of their bore licences and land was greater than the sum of the value to the first and second plaintiffs of their land and aquifer access licences, even taking into account the structural adjustment payments. The Solicitor-General of the Commonwealth submitted that the "just terms" requirement did not call for "full money equivalence" between what the plaintiffs lost and what they gained, and that it was sufficient that there be "fair dealing between the Australian nation and the plaintiffs." It is unnecessary to decide whether that controversial and somewhat obscure construction of s 51(xxxi) is correct. That is because there was in any event no fair dealing. The Solicitor-General submitted that there was fair dealing for the following reasons. His first contention was that the bore licensees could never have enjoyed their entitlements in full. There was not enough water to go around. Instead, the aquifer access licences gave them "a realistic and sustainable version of those entitlements." This argument would have had more force if it had been demonstrated that the aquifer access licences gave the maximum amount to licensees which was sustainable. The relevant governments may have believed this, and they may well be right, but it was not actually demonstrated. The argument echoed an earlier argument that bore licensees did not have "a secure right to a specified share of the available water resource" because the licence conditions controlling what they could receive might always be varied. The Solicitor-General contended that s 56(1)(a) of the Water Management Act 2000, in contrast, did confer on aquifer access licensees a secure right to a specified share. Section 56(1)(a) does provide: "An access licence entitles its holder: to specified shares in the available water within a specified water management area or from a specified water source (the share component)". The truth is that both before and after 2008 New South Wales did not have an untrammelled power to reduce entitlements328. Section 68A(1) provides: "The Minister may amend the share component or extraction component of an access licence in accordance with this Act or the relevant management plan." And s 66 provides that aquifer access licences are subject to conditions imposed on them by the relevant management plan or by the Minister. The rights of the bore licensees before 2008 were not wholly insecure; the rights of the aquifer access licensees after 2008 are not wholly secure either. In the end, in both periods, everything depends on availability. The second contention of the Solicitor-General was that even if the Funding Agreement had never been made, New South Wales would have reduced entitlements in the Lower Lachlan Groundwater System from 215,417 megalitres per year to 120,000, and the actual amount to be extracted would have been reduced to 96,000. The primary difference between this 2003 scheme and the scheme introduced in 2008 was that the methodology changed from an "across the board basis" to a "history of use" basis. This was within a legitimate margin of legislative appreciation. The flaw in this argument is that even if the Funding Agreement had never been made and New South Wales could and would have proceeded without it, the Funding Agreement, the Amendment Regulation, the Proclamation and the Amendment Order are not rendered lawful by the possibility that another avenue towards expropriation could have been selected. The use of constitutionally invalid means to achieve a goal is not rendered constitutionally valid by the circumstance that the same goal could have been achieved by constitutionally valid means. Thirdly, the Solicitor-General submitted that bore licensees' rights "were not readily tradeable and were in effect attached to the land." Their monetary value could only be determined "in an inexact and general fashion". The aquifer access licences were more readily tradeable. They rested on a basis of more sustainable extraction from the aquifers. Hence they had greater value than the bore licences. In this argument the Commonwealth went to the verge of, and perhaps beyond, the stage of contending that New South Wales did the bore licensees a big favour by destroying their property rights. But the argument fails, even if the assumption is made, which the plaintiffs contest, that the aquifer access licences amounted to a "realistic and sustainable version" of the entitlements under the bore licences. Difficulties in valuation are not obstacles to assessing the justness of terms329. It has not been demonstrated that before 2008 328 See [208]. 329 See above at [227]. the bore licensees' rights were not readily tradeable or that they were attached to the land: the fact is that they were frequently traded, as objects both of sale and mortgage330. The Solicitor-General endeavoured to support the proposition he advocated by saying: "The development of more secure and more readily tradeable rights to water was an object which had been pursued for some time by Commonwealth and State and Territory governments, including through intergovernmental agreements and other arrangements for coordinated action." He referred to numerous documents. The submission ignores the fact that the critical date for assessing transferability is early 2008 when the Amendment Regulation was introduced. All the documents to which the Solicitor-General referred predate early 2008 by significant periods. The "development of more secure and more readily tradeable rights to water" is a goal which had been substantially achieved before the enactment of the Water Management Act 2000, and it was a development which bore licensees in the Lower Lachlan Groundwater System were enjoying well before their licences were expropriated The Solicitor-General's submissions that the aquifer access licensees' rights are more tradeable or that they are more valuable than the bore licensees' rights were have not been demonstrated to be correct. The first and third contentions of the Solicitor-General are completely inconsistent with the admissions in the pleadings331. It follows that question 1(b)332 should be answered "Yes". The Solicitor-General for South Australia advanced a very brief submission that the National Water Commission Act 2004 should be read down. No party made this submission, and the first two defendants specifically declined to advance it. To accept it might leave the Funding Agreement invalid or unenforceable on another ground, with possible consequences for the defendants which may be controversial as between them. In view of their decision not to advance the submission, it should not be acceded to. 330 See [201]-[204] and [207] above. 331 See above at [237]. 332 See [101]. Validity of Amendment Regulation, Proclamation and Amendment Order The next question the Proclamation and the Amendment Order are also invalid or inoperative in consequence of the invalidity of the National Water Commission Act 2004. the Amendment Regulation, is whether The Funding Agreement had as its goal the reduction of groundwater usage by destroying the entitlements of bore licensees, including those of the plaintiffs, in the groundwater systems of New South Wales, and replacing them with other and lesser entitlements. It was a goal conceived with the best of intentions to deal with a major public problem. But that did not absolve the participants from the need to comply with the Constitution. It was a necessary step in the achievement of that goal that the plaintiffs' licences be cancelled. That was effectuated partly by Commonwealth legislation – the National Water Commission Act 2004 – which authorised the supply of funding to New South Wales pursuant to s 96 of the Constitution. And it was effectuated partly by New South Wales legislation – the Amendment Regulation made pursuant to the Water Management Act 2000 – the operation of which in turn depended on the Proclamation and the Amendment Order. Section 51(xxxi) prevented the National Water Commission Act 2004 from being validly enacted in terms as wide as it was because it was legislation providing for the acquisition by New South Wales of property otherwise than on just terms. The Act was therefore invalid. So was the Funding Agreement. Section 106 of the Commonwealth Constitution provides that the Constitution of New South Wales is subject to the Commonwealth Constitution333. Covering cl 5 provides that the Commonwealth Constitution is binding on the people of every State334. It follows that the New South Wales Government, which operates under the Constitution of New South Wales, has no power to participate in conduct which is in contravention of s 51(xxxi). The Amendment Regulation, the Proclamation and the Amendment Order were seen by New South Wales and by the Commonwealth as steps in a scheme or plan designed to achieve the goal of terminating the rights of bore licensees in the Lower Lachlan Groundwater System. They were steps – together with many other steps of cooperation between the Commonwealth and New South Wales – taken in concert to achieve a goal which depended on a contravention by the Commonwealth of s 51(xxxi). It was not contemplated that the goal could be achieved without the contravention. It does not matter that none of those three steps is in terms expressed to be "contingent on the operation of a binding agreement or operative Commonwealth law", to use the language of the Solicitor-General for South Australia: they were part of the scheme contemplated. In consequence none of 333 See [102] n 107. 334 See [102] n 106. those three steps can survive. A contrary view would annihilate the effectiveness of s 51(xxxi). The Solicitor-General of the Commonwealth contended that any difficulty caused by the Funding Agreement could have been overcome by an agreement to terminate it, and by the Commonwealth providing funds in some other way. The merits of this submission are immaterial. The fact is that those things were not done. The Solicitor-General of the Commonwealth also submitted that Pye v Renshaw335 was inconsistent with the plaintiffs' arguments. But that case is distinguishable. For one thing, in that case, unlike this case, there was no challenge to the validity of State legislation336. Various of the interveners, together with the Solicitor-General of the Commonwealth, contended that to invalidate the Amendment Regulation, the Proclamation and the Amendment Order would wrongly impose s 51(xxxi) on the States. It does not do that. The States, subject to their own legislation, are at liberty to make uncompensated expropriations, at least in fields which s 109 of the Constitution leaves open to them. But they are not at liberty to embark on schemes with the Commonwealth involving steps which include a failure by the Commonwealth to comply with s 51(xxxi). The Solicitor-General for New South Wales submitted in effect that the plaintiffs' submissions produced an absurd result in that their victory would only be Pyrrhic: the entitlements of the plaintiffs could be terminated by New South Wales acting alone without any compensation or ex gratia payments. Whether or not that will be so must be left to the future. It does not reveal absurdity in the plaintiffs' arguments. The plaintiffs are entitled to have their arguments considered, irrespective of any consequences adverse to them which may flow. The Solicitor-General for New South Wales also advanced detailed arguments for the following proposition: the constitutional guarantee, merely because "There is no constitutional impropriety, nor any attempt to defeat the operation of the Commonwealth provides financial assistance to a State to achieve a legitimate State objective even if, had the Commonwealth attempted to achieve that objective itself, it would have been subject to some constitutional prohibition." 335 (1951) 84 CLR 58; [1951] HCA 8. 336 (1951) 84 CLR 58 at 80. Even if that is accepted, the present case is different. In this case, part of the achievement of the "legitimate State objective" depended on the Commonwealth enacting legislation which was subject to the prohibition in s 51(xxxi). Hence all three steps are invalid. Continuing validity of bore licences The third question in the Special Case is whether the plaintiffs remain owners of their bore licences. Correctly, the defendants did not contend for any answer other than an affirmative one. Answers to questions The questions337 should be answered: (a) Need not be answered. (b) Yes. Each is invalid. Yes. Does not arise. The defendants. 337 See [101].
HIGH COURT OF AUSTRALIA STATE OF NEW SOUTH WALES APPELLANT AND RESPONDENT New South Wales v Ibbett [2006] HCA 57 12 December 2006 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation J E Maconachie QC with E Chrysostomou for the appellant (instructed by Crown Solicitor for New South Wales) J J J Garnsey QC with B E Kinsella for the respondent (instructed by James Fuggle) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS New South Wales v Ibbett Tort – Trespass – Whether recognition of occupiers' rights of quiet enjoyment of land an appropriate consideration when awarding damages. Damages – Aggravated damages – Exemplary damages – Where assault and trespass committed by police officers – Whether an award of general damages, aggravated and exemplary damages involves punishment twice for the same wrong. Damages – Exemplary damages – Vicarious liability – Where the Law Reform (Vicarious Liability) Act 1983 (NSW) and the Police Legislation Amendment (Civil Liability) Act 2003 (NSW) assigned liability of police officers to the Crown – Whether award of exemplary or aggravated damages against the Crown appropriate. Words and phrases – "double punishment", "aggravated damages", "exemplary damages", "vicarious liability". Crown Proceedings Act 1988 (NSW), s 5. Law Reform (Vicarious Liability) Act 1983 (NSW), ss 6, 8, 9B, 9G(2). Police Legislation Amendment (Civil Liability) Act 2003 (NSW). GLEESON CJ, GUMMOW, KIRBY, HEYDON AND CRENNAN JJ. This appeal by the State of New South Wales from the New South Wales Court of Appeal1 raises issues the resolution of which depends upon the interplay between the common law and several items of New South Wales legislation. The issues involve the nature and extent both of the interests protected and vindicated by an award of damages against the State for trespass to land and of the vicarious liability of the State for exemplary damages awarded in an action for trespass to land and for assault. It should be observed at the outset that much of the criticism respecting the remedy of exemplary damages has been stimulated by such awards in defamation actions. This appeal does not arise from an action of that kind and, in any case, under the recent legislation in this country, no plaintiff may be awarded exemplary or punitive damages for defamation2. The nature of the action The respondent ("Mrs Ibbett") brought an action in the District Court for damages occasioned by reason of the conduct at her house of two members of the NSW Police3. The State was identified by s 5 of the Crown Proceedings Act 1988 (NSW) ("the Crown Proceedings Act") as the proper defendant. This rendered the State generally amenable to an action in tort based upon vicarious liability4. In former times, the circumstance that police officers often acted in the exercise of common law or statutory powers and according to "independent" discretions 1 State of New South Wales v Ibbett [2005] NSWCA 445, reported in part in (2005) 65 NSWLR 168. 2 See, eg, Defamation Act 2005 (NSW), s 37. 3 Established by the Police Act 1990 (NSW). See, generally, Jarratt v Commissioner of Police (NSW) (2005) 79 ALJR 1581; 221 ALR 95. 4 Hogg and Monahan, Liability of the Crown, 3rd ed (2000) at 111-112, 116. Section 10 of the Crown Proceedings Act repealed the Claims against the Government and Crown Suits Act 1912 (NSW), whose nominal defendant procedures previously had been utilised in tort actions arising from police misconduct and including Griffiths v Haines [1984] 3 NSWLR 653 and Lippl v Haines (1989) 18 NSWLR 620. Kirby Crennan would have taken an action such as that of Mrs Ibbett outside the scope of the vicarious liability of the Crown5. However, in this respect, there has been further legislation. Section 6 of the Law Reform (Vicarious Liability) Act 1983 (NSW) ("the 1983 Act") deems police officers to be persons in the service of the Crown. Section 8 renders the Crown vicariously liable in respect of torts committed by such persons in the course of their service and in performance or purported performance of an independent function. No occasion arises in this appeal to examine the statutory equation of the State, created by the Constitution of the Commonwealth, with the Crown6. The 1983 Act can be interpreted in accordance with its own terms and without reference to any possible constitutional questions. Counsel for the State emphasised that s 8 is drawn in terms which apply the "master's tort" theory of vicarious liability, associated with the reasons of Fullagar J in Darling Island Stevedoring and Lighterage Co Ltd v Long7, whereby the master is liable for a breach of duty resting on the servant, not on the master, and broken by the servant. The other theory, that adopted by Kitto J in Long8, treats the act of the servant as the indirect act of the master. Mrs Ibbett's action was commenced on 10 December 2002 against the State as third defendant and Senior Constables Pickavance and Harman as first and second defendants. Before trial, Mrs Ibbett discontinued her action against the individual defendants and the action proceeded to a hearing before Phegan DCJ (sitting alone) as one solely against the State. However, in 2003, the 1983 Act was amended, with respect to the pending litigation, by the Police 5 Enever v The King (1906) 3 CLR 969; Jarratt v Commissioner of Police (NSW) (2005) 79 ALJR 1581 at 1584 [4]-[5], 1593-1594 [70], 1603 [119]; 221 ALR 95 at 96-97, 110, 123; Hogg and Monahan, Liability of the Crown, 3rd ed (2000) at 6 The Commonwealth v Mewett (1997) 191 CLR 471 at 545-552; cf Byrne v Ireland [1972] IR 241 at 272-273 per Walsh J. (1957) 97 CLR 36 at 56-57; cf Majrowski v Guy's and St Thomas's NHS Trust [2006] 3 WLR 125 at 129 per Lord Nicholls of Birkenhead; [2006] 4 All ER 395 at (1957) 97 CLR 36 at 64-65. Kirby Crennan Legislation Amendment (Civil Liability) Act 2003 (NSW) ("the 2003 Act"). The changes made by the 2003 Act of its own force relevantly applied to the pending action (s 9G(2)). Further, s 9B introduced a special regime in the following terms: "(1) A police tort claim is a claim for damages for a tort allegedly committed by a police officer (the police officer concerned) in the performance or purported performance of the officer's functions (including an independent function) as a police officer, whether or not committed jointly or severally with any other person. Except as provided by this Part, a person may not in any legal proceedings make a police tort claim against the police officer concerned, but may instead make the claim against the Crown. (3) A person who makes a police tort claim against the Crown in any legal proceedings may join the police officer concerned as a party to the proceedings only if the Crown denies that it would be vicariously liable for the alleged tort if it were established that the police officer concerned had committed the tort." For the purposes only of s 9B(3), the State admitted vicarious liability for the conduct of the two police officers. The facts More should be said now respecting the facts. Mrs Ibbett was born in 1931. Her husband had died in 1995. Mrs Ibbett had owned three shops and had worked as a paymistress for 17 years. She last worked in 1987. Mrs Ibbett had been very involved with the bowling community and had been District President of the Lower North Coast District. The trial judge accepted her evidence, saying that she gave her testimony in a clear and matter of fact way, and without any sign of exaggeration or reason for suspecting invention. Mrs Ibbett had three children, a daughter and two sons. One son, Warren, born in 1958, returned to live with his mother since his release from prison in 1997. This was after he had served a term of five and a half years imprisonment. That was the third of three lengthy periods of imprisonment served by him. He said in evidence at the trial of the present action that he had been a drug user "on and off over the years". Kirby Crennan The events complained of by Mrs Ibbett occurred in the early hours of 23 January 2001 at the house then owned and occupied by her in Forster, on the North-central coast of New South Wales. The house had been built for Mrs Ibbett with the assistance of her son in fitting it out. The premises had four bedrooms and an attached double garage with access from the house. Shortly before 2.00 am on 23 January 2001, whilst Mrs Ibbett was asleep in the main bedroom across a hallway directly behind the garage, her son arrived home in his van. He was pursued by a police vehicle. The police vehicle was occupied by the two police officers, Senior Constables Pickavance and Harman. They were acting under operational orders "to keep a lookout for" Mr Ibbett. However, the only offence, commission of which the police reasonably suspected Mr Ibbett, was a driving offence. Mr Ibbett drove into the garage of the house and, using a remote control device, closed the roller door. As the roller door was closing, Senior Constable Pickavance dived under it and sought to arrest Mr Ibbett. He had no proper basis for making such an arrest or entering the property. He was not uniformed and was wearing casual clothing. There was a commotion with both parties shouting or screaming at each other. This awakened Mrs Ibbett. Whilst Senior Constable Pickavance had his service pistol directed at Mr Ibbett, Mrs Ibbett opened a door leading from the hallway into the garage. She heard her son say to Senior Constable Pickavance, "Who are you? Get outta here." She repeated words to that effect, at which stage Senior Constable Pickavance swung towards her, pointing his gun at her and said, "Open the bloody door and let my mate in." Mrs Ibbett had never seen a gun before and was petrified. The trial judge regarded that description of her state of mind as no exaggeration. To this point, Senior Constable Harman had been outside the house but came in when the roller door to the garage was re-opened. Like Senior Constable Pickavance, he was not uniformed and wore casual clothing. Mr Ibbett was removed to the driveway, handcuffed and pushed to the ground. Uniformed police arrived. Mr Ibbett's vehicle was removed onto the driveway and searched. He himself was returned to the garage and strip searched. Criminal proceedings were commenced against Mr Ibbett. However, these were subsequently withdrawn. At the trial in the District Court of Mrs Ibbett's claim for damages against the State, Senior Constable Pickavance denied that he had pointed a gun at Kirby Crennan Mrs Ibbett, but his evidence was not accepted. The trial judge described him as "conspicuously careless with the truth". Senior Constable Harman was treated as a more forthright and reliable witness but much of his evidence impressed the trial judge as coloured by a sense of loyalty to his fellow officer. "It is very difficult to escape the conclusion that, contrary to their evidence, the police officers were on the look out for Ibbett, identified his van as it came along Lakes Way, pursued it and, in their determination to effect an arrest and in doing so find evidence of either house breaking or possession of drugs or both, had followed Ibbett into his mother's premises. Ibbett may have exceeded the speed limit and may even have driven erratically at times giving Pickavance and Harman some justification for an arrest and one of the subsequent charges which were laid against Ibbett. The hope of being able to make more serious criminal charges stick was dashed by the lack of adequate evidence found either on Ibbett or in his van." His Honour found that the entry into the property by both police officers had been without lawful justification and had amounted to trespass to land. His Honour also held that the confrontation between Senior Constable Pickavance and Mrs Ibbett was more than sufficient to justify the requirements of an immediate apprehension of harm on her part, intentionally caused by Senior Constable Pickavance so as to amount to an assault. These findings were not challenged in the Court of Appeal and are not challenged in this Court. Rather, the appeal turns upon questions concerning the damages that Mrs Ibbett was entitled to recover. The damages award The formulation of the damages award both at trial and after an appeal and cross-appeal to the Court of Appeal has been somewhat complicated. The trial judge entered a verdict and judgment for the trespass by both police officers in the sum of $50,000 and for the assault by Senior Constable Pickavance in the sum of $25,000. The award of $25,000 for the assault represented $15,000 as general damages and what his Honour said was an award "of modest proportions" of exemplary damages of $10,000. The award of $50,000 for trespass comprised general damages of $10,000 to recognise "the offence and indignity to [Mrs Ibbett's] rights caused by the unlawful entry", aggravated damages of $20,000 and exemplary damages of $20,000. Kirby Crennan No award of aggravated damages was made by the trial judge in respect of the assault. However, the Court of Appeal (Spigelman CJ, Ipp and Basten JJA) unanimously awarded $10,000 aggravated damages for the assault. In addition, an order increasing the award of exemplary damages for the assault from $10,000 to $25,000 was supported by Spigelman CJ and Basten JA, Ipp JA dissenting. The awards of aggravated and exemplary damages for trespass, each of $20,000, were retained by Spigelman CJ and Basten JA; Ipp JA would have made no awards under these heads. The Court of Appeal directed entry of judgment for Mrs Ibbett in the total sum of $100,000. The issues in this Court In oral submissions to this Court, counsel for the State stressed that the interest of the State on the appeal was in establishing the applicable principles, rather than precise assessment of the various heads of damages awarded. The State submits, first, that in upholding the awards of aggravated and exemplary damages for the trespass, the majority in the Court of Appeal (particularly Spigelman CJ) wrongly took into account the interest of the occupier of land in undisturbed enjoyment by the occupier and the guests of the occupier. In that regard, Spigelman CJ had held that, while in the present case an award of exemplary damages could not be supported, an award of damages for trespass to land can vindicate the right of an occupier to have undisturbed the owner's guests and residents. On the other hand, Ipp JA disagreed that such a right was recognised in the tort of trespass and the State supports what was said by Ipp JA. Secondly, the State complains that, by awarding general damages, aggravated damages and exemplary damages for trespass to land, the State had been punished twice for the same wrong. Thirdly, as to the awards of exemplary damages (for which the State is liable only vicariously), the State contends that Ipp JA was correct when he said: "The State can only be punished for the conduct of those who train and discipline the police force when a case is properly made out based on the unlawful conduct of such officials. It is quite wrong, in my view, to fix the State with vicarious liability for the conduct of persons who are not before the court, who have not been identified, whose conduct is not the subject of allegations in the pleadings, whose conduct has not been Kirby Crennan investigated at the trial, and against whom no specific findings have been made. I would add that it is difficult to comprehend how an award against [the State] could be said merely to irritate because it is $10,000 but would sting if it were $25,000, particularly if regard is had to the State's annual budget. The force of the proposition is not, in my view, increased if the amount is increased to $45,000 by lumping the tort of assault together with the tort of trespass." Before turning to consider the issues thus raised, three preliminary matters should be noted. The first is that, whatever may be the significance for the law of trespass of the undisturbed presence of guests of the occupier, the facts of this litigation have a narrower focus. Mr Ibbett was living in his mother's house and was a member of the household, not a guest in any transient or merely social sense; the position in respect of such persons may be put to one side in deciding the first issue on this appeal. The second preliminary matter is that the case cannot be approached on the footing that the conduct of the police officers was to be explained in whole or part by reference to known violent propensities of Mr Ibbett. There was no finding to that effect and, in any event, Senior Constable Pickavance had denied pulling his gun but was not believed. The third matter is that the police officers appear to have received limited "re-education" from other officers (not of superior rank) with respect to their conduct at Mrs Ibbett's house on the night in question. Senior Constable Harman said he had "a quick briefing", the content of which he could not recall. Senior Constable Pickavance said he was told at a five minute meeting with an Education Development Officer ("EDO") that he should not have rolled out Mr Ibbett's vehicle and should have got a search warrant. The EDO said, "Oh boys you'd better do better next time." Mrs Ibbett said that she was offended by this seemingly trivial and apparently dismissive response to what had happened to her. Trespass – the interest protected We turn first to consider the award of aggravated and exemplary damages for the circumstances in which the trespass to Mrs Ibbett's property was committed by the two police officers. It is well established that the tort protects Kirby Crennan the interest of the plaintiff in maintaining the right to exclusive possession of her place of residence, free from uninvited physical intrusion by strangers. It is not the concern of the law here to protect title in the sense of ownership but, as in the present case, the party in possession may often also be the owner. But how extensive is that interest in exclusive possession? In Plenty v Dillon9, Mason CJ, Brennan and Toohey JJ said of the proposition that the trespass to the plaintiff's farm was of such a trifling nature as not to found liability in damages: "[b]ut this is an action in trespass not in case and the plaintiff is entitled to some damages in vindication of his right to exclude the defendants from his farm". In their discussion of the tort of trespass in their joint reasons in Plenty, Gaudron and McHugh JJ said that the policy of the law here was the protection of possession of property and the privacy and security of the occupier10. Among the authorities to which their Honours referred was the statement by Lord Scarman in another trespass case, Morris v Beardmore11, emphasising the fundamental importance attached by the common law to the privacy of the home. Aggravated damages are a form of general damages, given by way of compensation for injury to the plaintiff, which may be intangible, resulting from the circumstances and manner of the wrongdoing12. The interest of the plaintiff against invasion of the exclusive possession of the plaintiff extends to the freedom from disturbance of those persons present there with the leave of the plaintiff, at least as family members or as an incident of some other bona fide domestic relationship. The affront to such persons may aggravate the infringement of the right of the plaintiff to enjoy exclusive and quiet (1991) 171 CLR 635 at 645. 10 (1991) 171 CLR 635 at 647. 11 [1981] AC 446 at 464. 12 Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 129-130. 13 cf Brame v Clark 62 SE 418 at 419 (1908); May v Western Union Telegraph Co 72 SE 1059 at 1062 (1911); Douglas v Humble Oil & Refining Company 445 P 2d 590 (1968); Restatement of Torts, 2d, vol 1, Appendix (1966), §162. Kirby Crennan The decision of the majority in the Court of Appeal to uphold the award of aggravated damages partly by reference to the affront to Mrs Ibbett of the treatment of her son as well as herself was consistent with basic principle. The same is true, subject to what now follows, of the award of exemplary damages for the trespass. This outcome invites attention to the second main complaint by the State, namely, that respecting alleged "double punishment" for the same wrong. "Double punishment" In Uren v John Fairfax & Sons Pty Ltd14, Taylor J, after observing that aggravated damages fix upon the circumstances and manner of the wrongdoing of the defendant, contrasted the function of exemplary damages as punishment and deterrent of the wrongdoer. His Honour added that15: "in many cases, the same set of circumstances might well justify either an award of exemplary or aggravated damages". Subsequently, in Lamb v Cotogno16, in the joint reasons of five members of the Court, the conceptual distinction was drawn between the compensatory nature of aggravated damages and the punitive and deterrent nature of exemplary damages. Their Honours added that in some cases it might be difficult to differentiate between aggravated damages and exemplary damages. Gleeson CJ, McHugh, Gummow and Hayne JJ spoke in like terms in Gray v Motor Accident Commission17. In the present case, awards were made under both heads. However, Spigelman CJ was alive to the conceptual distinctions involved, as appears in the following passage: "In this regard it is relevant to note that the matters to which I have referred as justifying an award of exemplary damages are also pertinent, 14 (1966) 117 CLR 118. 15 (1966) 117 CLR 118 at 130. 16 (1987) 164 CLR 1. 17 (1998) 196 CLR 1 at 4 [6]; see also at 34-36 [100]-[103]. Kirby Crennan as is often the case, to an award of aggravated damages. The difference is that in the case of aggravated damages the assessment is made from the point of view of the Plaintiff and in the case of exemplary damages the focus is on the conduct of the Defendant. Nevertheless, it is necessary, as I have noted above, to determine both heads of compensatory damages before deciding whether or not the quantum is such that a further award is necessary to serve the objectives of punishment or deterrence or, if it be a separate purpose, condemnation." In cases where the same circumstances increase the hurt to the plaintiff and also make it desirable for a court to mark its disapprobration of that conduct, the court may choose to award one sum which represents both heads of damages and no element more than once. Such an approach was adopted by Bray CJ in Johnstone v Stewart18. In the present case, Basten JA favoured a variation of this approach, with a global award of exemplary damages in respect of the causes of action in trespass and in assault. However, in the event, nothing turned on the different approaches in this regard because the global award of $45,000 was equal to the distinct awards of $25,000 and $20,000 favoured by Spigelman CJ. The reasons for judgment of the two members of the majority in the Court of Appeal should be read as a whole. When this is done, it is apparent that Spigelman CJ and Basten JA were mindful of the conceptual distinctions between aggravated and exemplary damages and of the dangers of an excessive overall award where some or all of the factors supporting one head of damages also supported the other. Accordingly, the complaint made by the State of "double punishment" is not made out. There remains the complaint by the State respecting the treatment of its vicarious liability for exemplary damages. Exemplary damages The common law fixes by various means a line between the interests of the individual in personal freedom of action and the interests of the State in the maintenance of a legally ordered society. An action for trespass to land and an 18 [1968] SASR 142 at 144-145. The judgment of Bray CJ in this respect is discussed with a measure of approval by Professor Julius Stone, "Double Count and Double Talk: The End of Exemplary Damages?", (1972) 46 Australian Law Journal 311 at Kirby Crennan award of exemplary damages has long been a method by which, at the instance of the citizen, the State is called to account by the common law for the misconduct of those acting under or with the authority of the Executive Government19. Indeed, the first reported use of the expression "exemplary damages" may have been by Pratt LCJ20 in Huckle v Money21. Huckle was one of several tort actions in the Court of Common Pleas22 arising from the use by the administration of George Grenville23 of general warrants in its campaign in the 1760s against the activities of John Wilkes and the publication styled the North Briton. The jury in Huckle awarded no less than £300 damages, an enormous sum for the times, and the Lord Chief Justice said they were not excessive. Windeyer J later doubted whether the origin of the idea conveyed by the term "exemplary damages" was as recent as Huckle24. However that may be, what is well established is that an award of exemplary damages may serve "a valuable purpose in restraining the arbitrary and outrageous use of executive power" and "oppressive, arbitrary or unconstitutional action by the servants of the government". The words are those of Lord Devlin, no supporter of the general use of this remedy25. His Lordship added that26: 19 Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 558; Enfield City Corporation v Development Assessment Commission (2000) 199 CLR 135 at 143-144 [17]. 20 Subsequently Lord Chancellor (1766-1770) as Lord Camden. 21 (1763) 2 Wils KB 205 at 207 [95 ER 768 at 769]. The defendant was a King's messenger, sued for trespass, assault and false imprisonment by a journeyman printer. The term "exemplary damages" was also used by the Court of Common Pleas in Grey v Grant (1764) 2 Wils KB 252 at 253 [95 ER 794 at 795]. 22 Another was Wilkes v Wood (1763) Lofft 1 [98 ER 489], where the award by a special jury in favour of John Wilkes was £1000. Wood was an under-secretary of State: Watson, The Reign of George III, (1960) at 100. See also the discussion of these cases by Binnie J in Whiten v Pilot Insurance Co [2002] 1 SCR 595 at 23 First Lord of the Treasury (1763-1765), in succession to the Earl of Bute. 24 Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 152-153; see also Gray v Motor Accident Commission (1998) 196 CLR 1 at 5 [8]. 25 Rookes v Barnard [1964] AC 1129 at 1223, 1226. Kirby Crennan "the servants of the government are also the servants of the people and the use of their power must always be subordinate to their duty of service". In Kuddus v Chief Constable of Leicestershire Constabulary27, Lord Hutton considered these remarks of Lord Devlin with the added authority of his own judicial experience in Northern Ireland, including his award of exemplary damages in Pettigrew v Northern Ireland Office28. Lord Hutton concluded in Kuddus29: "I think that a number of cases decided by the courts in Northern Ireland during the past 30 years of terrorist violence give support to the opinion of Lord Devlin in Rookes v Barnard30 that in certain cases the awarding of exemplary damages serves a valuable purpose in restraining the arbitrary and outrageous use of executive power and in vindicating the strength of the law. Members of the security forces seeking to combat terrorism face constant danger and have to carry out their duties in very stressful conditions. In such circumstances an individual soldier or police officer or prison officer may, on occasion, act in gross breach of discipline and commit an unlawful act which is oppressive or arbitrary and in such cases exemplary damages have been awarded." His Lordship added31: "In my opinion the power to award exemplary damages in such cases serves to uphold and vindicate the rule of law because it makes clear that the courts will not tolerate such conduct. It serves to deter such actions in future as such awards will bring home to officers in command of individual units that discipline must be maintained at all times." 26 [1964] AC 1129 at 1226. 27 [2002] 2 AC 122 at 147-149. 28 [1990] NI 179 at 181-182. 29 [2002] 2 AC 122 at 147. 30 [1964] AC 1129 at 1223, 1226. 31 [2002] 2 AC 122 at 149. Kirby Crennan Vicarious liability In previous times, the situation respecting vicarious liability in tort was complicated by the rules respecting Crown immunity in England. On that subject, and with reference to the reasons of Cockburn LCJ in Feather v The Queen32, Gummow and Kirby JJ remarked in The Commonwealth v Mewett33: "[A] servant of the Crown was responsible at common law for a tortious act done to a fellow subject, although done by the authority of the Crown, and to that tortfeasor the immunity of the Crown would afford no defence. Moreover, in most instances, the action against the officer or servant of the Crown would have the same effect as a petition of right would have, 'since, in a proper case, the Crown [would] defend its officer and become responsible for any damages awarded'34." The first sentence of that passage explains the constitution of the actions against the under-secretary of State, King's messenger and other officials sued in the saga of John Wilkes during the reign of King George III. The second sentence explains why the personal means of comparatively lowly officials, sued at a time when Crown immunity still barred a direct action, would not constrain awards of exemplary damages. The 2003 Act takes the statute law of New South Wales even further with respect to police tort claims. Section 9B(2) applied in the present case by denying the competency of an action against the two police officers themselves and providing "instead" for the claim to be made against the State. Earlier statute law in New South Wales had both rendered the State amenable to actions in tort (s 5 of the Crown Proceedings Act, referred to earlier in these reasons) and had deemed the vicarious liability of the State to extend to wrongs of the nature of those committed by Senior Constables Pickavance and Harman (s 6 of the 1983 Act). 32 (1865) 6 B & S 257 at 295-296 [122 ER 1191 at 1205]. 33 (1997) 191 CLR 471 at 543. 34 Robertson, The Law and Practice of Civil Proceedings By and Against the Crown and Departments of the Government, (1908) at 351. Kirby Crennan The case law The 1983 and 2003 Acts were enacted in New South Wales against a background of the case law in Australia which accepted that a defendant whose liability in tort was vicarious might suffer an award of exemplary damages. In Healing (Sales) Pty Ltd v Inglis Electrix Pty Ltd35, an award of exemplary damages had been made by Macfarlan J on the counts of trespass to goods and conversion by employees of the defendant36; this Court upheld the decision of the New South Wales Court of Appeal not to add an additional award on the counts of trespass to land by those employees. Thereafter, in an action in trespass tried in 1981, a New South Wales jury awarded exemplary damages of $400,000 against Caltex Oil (Australia) Pty Ltd. That award was reduced to $150,000 but otherwise upheld by the New South Wales Court of Appeal in 198237 and, thereafter, by this Court38. Caltex had procured the spiking by others of the plaintiff's tanks. Such authorities in this Court assume that awards of exemplary damages may properly be made against a principal or employer who is vicariously liable for the tortious acts or omissions of an agent or employee; they do not canvass any rationale for the making of such awards. The nature of vicarious liability most recently was treated by this Court in Sweeney v Boylan Nominees Pty Ltd39 and need not be further considered here. But why, it has been asked, should shareholders of a corporation bear the burden of the punishment by the medium of an award of exemplary damages for corporate conduct in which they took no part?40 That question itself recapitulates 35 (1968) 121 CLR 584. 36 (1968) 121 CLR 584 at 591, 599, 622-623. 37 Caltex Oil (Australia) Pty Ltd v XL Petroleum (NSW) Pty Ltd [1982] 2 NSWLR 38 XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985) 155 CLR 448. 39 (2006) 80 ALJR 900; 227 ALR 46. 40 Waddams, The Law of Damages, 3rd ed (1997), §11.420. Kirby Crennan arguments presented in the nineteenth century in related fields, before the development of modern ideas of corporate identity and responsibility41. Particular considerations respecting exemplary damages apply where the principal or employer is the State or a statutory emanation of the State. Reference has been made already to the views expressed on that subject, at least where military, police and prison officers are concerned, by Lord Hutton in Kuddus42. On the other hand, in that case Lord Scott of Foscote did not accept that a deterrent purpose was a sufficient justification for exemplary damages in vicarious liability cases43. Shortly thereafter, in S v Attorney-General44, the New Zealand Court of Appeal held that, if not as a matter of power, then at least as a prudential consideration, an award of exemplary damages against the Crown should not be made in respect of the tortious acts of foster parents against children placed in their care by the Superintendent of Child Welfare; this was because the Department was not "directly at fault"45. However, Blanchard J, who gave the principal reasons in S v Attorney-General, reserved the position where a police officer deliberately or recklessly directly inflicted personal injury on the plaintiff46. Moreover, in this Court, it has been said that there may be cases, framed in negligence, in which the defendant can be shown to have acted consciously in contumelious disregard of the rights of the plaintiff or persons in the position of the plaintiff47. 41 See Chapman and Trebilcock, "Punitive Damages: Divergence in Search of a Rationale", (1989) 40 Alabama Law Review 741 at 798-801, 819-821. 42 [2002] 2 AC 122 at 147-149. 43 [2002] 2 AC 122 at 161. 44 [2003] 3 NZLR 450. 45 [2003] 3 NZLR 450 at 475. 46 [2003] 3 NZLR 450 at 474-475. 47 Gray v Motor Accident Commission (1998) 196 CLR 1 at 9-10 [22], 27-29 [84]- [87]; cf A v Bottrill [2003] 1 AC 449 at 463-464; Whiten v Pilot Insurance Co [2002] 1 SCR 595 at 634-635. Kirby Crennan In the United States, the Due Process Clause of the Fourteenth Amendment and the prohibition by the Eighth Amendment upon excessive fines and cruel and unusual punishments have been used to place constitutional restraints upon the levels of exemplary damages awards by State court juries48. There is also a long line of authority in the United States which denies awards of exemplary damages against State municipal corporations which violate the constitutional rights of plaintiffs; such awards have been said by the United States Supreme Court to be "contrary to sound public policy" for the reason that they "would burden the very taxpayers and citizens for whose benefit the wrongdoer was being chastised"49. To that, the answer of those today of like mind with Pratt LCJ in 1763, and Lord Devlin in 1964, would be that in these cases the proceeds of taxation represent the price paid for maintaining respect by public officials for the observance of the rule of law, to the benefit of taxpayers and society as a whole. The submissions by the State On the present appeal, the State did not directly challenge the availability to the trial judge in this case and to the Court of Appeal of an award against the State of exemplary damages. However, counsel for the State emphasised the importance here of the adoption by s 8 of the 1983 Act of the "master's tort" theory of vicarious liability. Counsel then submitted that: "the focus in determining the liability and the quantum of the liability for exemplary damages has to be on the miscreants, the wrongdoers, and that involves looking at their position in terms of means and the like and determining what would be an appropriate order against them, not what would be an appropriate order against the State". This would reflect the proposition that s 8 of the 1983 Act imposes vicarious liability in respect of the torts, not the acts, of the police officers. Counsel accepted that it followed from his submission that, in so far as the police officers may have been contemptuous of their re-education, while this would legitimately be reflected either as aggravated or exemplary damages, it 48 BMW of North America Inc v Gore 517 US 559 (1996); Cooper Industries Inc v Leatherman Tool Group Inc 532 US 424 (2001). 49 Newport v Fact Concerts Inc 453 US 247 at 263 (1981). Kirby Crennan should not count against the police officers and not count against the State that the State did not respond properly by providing an effective re-education programme. Counsel for the State went on to stigmatise as illegitimate what had been said by Priestley JA when delivering the principal reasons in Adams v Kennedy50 as follows: "That figure [of exemplary damages] should indicate my view that the conduct of the [police officer] defendants was reprehensible, [and] mark the court's disapproval of it. The amount should also be such as to bring home to those officials of the State who are responsible for the overseeing of the police force that police officers must be trained and disciplined so that abuses of the kind that occurred in the present case do not happen." It may be added that, shortly thereafter, Lord Hutton was to speak to similar effect in Kuddus51 in the passage set out earlier in these reasons. Nor was Priestley JA the first to take such an approach to an award of exemplary damages in respect of the misuse of coercive powers entrusted to public officials. In Peeters v Canada52, the Federal Court of Appeal (Heald, MacGuigan and Linden JJA) upheld an award of $Can16,000 as "punitive" damages for an assault on the plaintiff, whilst in prison, committed by officers of the Correctional Service of Canada ("CSC"). After referring to the training given to CSC officers respecting the proper use of force on inmates, the Court remarked53: "The theory was excellent, but the CSC members clearly had not been trained to the point where reasonable restraint was second nature to them, as they should have been, as employees expected to use force. Instead, at the first temptation they succumbed to what the trial judge rightly called 'goon-squad machismo'." 50 (2000) 49 NSWLR 78 at 87. Sheller and Beazley JJA agreed with Priestley JA. 51 [2002] 2 AC 122 at 149. 52 (1993) 108 DLR (4th) 471. 53 (1993) 108 DLR (4th) 471 at 482. Kirby Crennan Conclusions respecting vicarious responsibility and exemplary damages The approach taken in cases such as Adams and Peeters should be accepted. It is supported by the observations of Lord Devlin and Lord Hutton to which reference has been made earlier in these reasons. The submissions by counsel for the State should be rejected. First, the course of development over the last two and a half centuries of the law respecting Crown liability in tort does not support attention to the financial means of the miscreant public officers as a significant and limiting determinant of the quantum of liability. Reference has been made earlier in these reasons to what was said on the subject in The Commonwealth v Mewett54. Secondly, the New South Wales legislative reforms do not require, in obedience to a "master's tort" theory, determination solely of what would be an appropriate award of exemplary damages against the police officers to the exclusion of considerations affecting the State itself. The doctrine, associated in Australia with Enever v The King55, which excepted the exercise of independent discretions from the legislative changes otherwise providing for the vicarious tort liability of the Crown, would have denied any award of exemplary or other damages against the State in the present case. The changes introduced by the 1983 Act rendered the State vicariously liable in tort, but s 9B, introduced by the 2003 Act, denies attribution of liability to the State in the present litigation simply by reference to a "master's tort" theory. The scheme of s 9B is to require persons in the position of Mrs Ibbett to sue only the State, and to do so "instead" of making a claim against the police officers. There are several qualifications to this new legal regime. The State is not rendered vicariously liable for police torts if it otherwise would not be so liable (s 9E(a)). The State may deny vicarious liability (s 9B(3)), something it did not do in this case. Further, there is preserved the possibility that the State may claim damages, contribution or indemnity against police officers (s 9E(b)). This too did not occur here. However, a principal object of the 2003 Act was to require the bringing of actions against the State instead of against the police 54 (1997) 191 CLR 471 at 543. 55 (1906) 3 CLR 969. Kirby Crennan officers concerned and to do so without affecting the rights of recovery by plaintiffs. In the Second Reading Speech in the Legislative Assembly on the Bill for the 2003 Act, the Minister for Police explained the reasons for the Bill by referring to vindictive claims made against individual police officers by criminals they apprehended and to the stress thereby caused, even though "individual officers may not be personally liable to pay damages". However, he added that "plaintiffs' rights of recovery are not affected by the bill"56. Spigelman CJ concluded on the evidence that the re-education programme indicated conduct by the State which was perfunctory in the extreme. Basten JA referred to Adams57 and said that although: "the inadequacy of the subsequent counselling was not the fault of Constable Pickavance, the evidence as to what took place in that regard prevents the State arguing that an award is not necessary to give effect to the purpose identified in Adams". It was consistent with principle and with the evidence for their Honours to have included those considerations in their treatment of the awards of exemplary damages. It follows that all of the State's criticisms of the awards of damages upheld by the majority of the Court of Appeal fail. Orders The appeal should be dismissed with costs. 56 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 13 November 2003 at 4971-4972. 57 (2000) 49 NSWLR 78.
HIGH COURT OF AUSTRALIA Matter No S183/2017 GARRY BURNS AND APPELLANT TESS CORBETT & ORS RESPONDENTS Matter No S185/2017 GARRY BURNS AND APPELLANT BERNARD GAYNOR & ORS RESPONDENTS Matter No S186/2017 ATTORNEY GENERAL FOR NEW SOUTH WALES APPELLANT AND GARRY BURNS & ORS RESPONDENTS Matter No S187/2017 ATTORNEY GENERAL FOR NEW SOUTH WALES APPELLANT AND GARRY BURNS & ORS RESPONDENTS Matter No S188/2017 STATE OF NEW SOUTH WALES APPELLANT AND GARRY BURNS & ORS RESPONDENTS Burns v Corbett Burns v Gaynor Attorney General for New South Wales v Burns Attorney General for New South Wales v Burns New South Wales v Burns [2018] HCA 15 18 April 2018 S183/2017, S185/2017, S186/2017, S187/2017 & S188/2017 ORDER Matter No S183/2017 Appeal dismissed. The appellant pay the first respondent's costs. Matter No S185/2017 Appeal dismissed. The appellant pay the first respondent's costs. Matter No S186/2017 Appeal dismissed. The appellant pay the second respondent's costs. Matter No S187/2017 Appeal dismissed. The appellant pay the second respondent's costs. Matter No S188/2017 Appeal dismissed. The appellant pay the second respondent's costs. On appeal from the Supreme Court of New South Wales Representation M G Sexton SC, Solicitor-General for the State of New South Wales and K M Richardson SC with M O Pulsford for the Attorney General for New South Wales and for the State of New South Wales (instructed by Crown Solicitor's Office (NSW)) K T Nomchong SC with K L Madgwick for Garry Burns in matters S183/2017 and S186/2017 and with H E Jewell for Garry Burns in matters S185/2017, S187/2017 and S188/2017 (instructed by Allens in S183/2017 and S186/2017, Lander & Rogers Lawyers in S185/2017 and S188/2017, and Dowson Turco Lawyers in S187/2017) S P Donaghue QC, Solicitor-General of C L Lenehan with J Freidgeim Commonwealth (instructed by the Australian Government Solicitor) the Commonwealth and the the Attorney-General of for P E King with J A Loxton for Tess Corbett (instructed by Robert Balzola and Associates) P E King for Bernard Gaynor (instructed by Robert Balzola and Associates) Submitting appearance for Civil and Administrative Tribunal of New South Wales in S185/2017, S187/2017 and S188/2017 Interveners P J Dunning QC, Solicitor-General of the State of Queensland, with F J Nagorcka for the Attorney-General of the State of Queensland intervening (instructed by Crown Solicitor (Qld)) P D Quinlan SC, Solicitor-General for the State of Western Australia, with C I Taggart for the Attorney-General for the State of Western Australia intervening (instructed by State Solicitor (WA)) M E O'Farrell SC, Solicitor-General for the State of Tasmania, with S K Kay, for the Attorney-General of the State of Tasmania intervening (instructed by Solicitor-General of Tasmania) K L Walker QC, Solicitor-General for the State of Victoria, with K E Foley for the Attorney-General for the State of Victoria intervening (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Burns v Corbett Burns v Gaynor Attorney General for New South Wales v Burns Attorney General for New South Wales v Burns New South Wales v Burns Constitutional law (Cth) – Chapter III – Where complaints made under Anti-Discrimination Act 1977 (NSW) came before Civil and Administrative Tribunal of New South Wales ("NCAT") – Where parties to disputes residents of different States – Where common ground that NCAT exercised State judicial power in hearing and determining disputes – Where common ground that NCAT not a "court of a State" – Whether Ch III of Constitution contains implication preventing any party to federal compact from conferring adjudicative authority in respect of matters listed in ss 75 and 76 of Constitution on organ of government, federal or State, other than a court referred to in Ch III. Constitutional law (Cth) – Inconsistency between Commonwealth and State laws – Where Civil and Administrative Tribunal Act 2013 (NSW) purports to confer jurisdiction on NCAT to determine disputes between residents of different States – Whether State law alters, impairs or detracts from operation of Judiciary Act 1903 (Cth), s 39(2). Words and phrases – "adjudicative authority", "administrative tribunal", "alter, impair or detract", "belongs to or is invested in", "constitutional implication", "court", "court of a State", "diversity jurisdiction", "federal Judicature", "federal jurisdiction", "inconsistency", "integrated national court system", "judicial power", "jurisdiction", "matter", "negative implication", "residents of different States", "State jurisdiction". Constitution, Ch III, ss 51(xxxix), 71, 73(ii), 75, 76, 77, 106, 107, 108, 109. Judiciary Act 1903 (Cth), ss 38, 39. Anti-Discrimination Act 1977 (NSW), ss 49ZT, 114. Civil and Administrative Tribunal Act 2013 (NSW), ss 28(2), 29(1), 32. Interpretation Act 1987 (NSW), s 31. KIEFEL CJ, BELL AND KEANE JJ. The first issue in these appeals is whether the Commonwealth Constitution precludes the Parliament of a State from conferring jurisdiction in respect of a matter between residents of different States within s 75(iv) of the Constitution on a tribunal which is not one of the "courts of the States" referred to in s 77 ("the Implication Issue"). If that issue were to be resolved in the negative, the further issue would arise as to whether a State law which purports to confer jurisdiction on such a tribunal in respect of such a matter is rendered inoperative by virtue of s 109 of the Constitution on the basis that it is inconsistent with s 39 of the Judiciary Act 1903 (Cth) ("the Judiciary Act") ("the Inconsistency Issue"). The Implication Issue should be the affirmative. Considerations of constitutional text, structure and purpose compel the conclusion that a State law that purports to confer jurisdiction with respect to any of the matters listed in ss 75 and 76 of the Constitution on a tribunal that is not one of the courts of the States is inconsistent with Ch III of the Constitution, and is, therefore, invalid. resolved Chapter III of the Constitution provides for the authoritative adjudication of matters listed in ss 75 and 76 by federal courts and by State courts co-opted for that purpose as components of the federal Judicature. The provisions of Ch III exhaustively identify the possibilities for the authoritative adjudication of matters listed in ss 75 and 76. Adjudication by an organ of State government other than the courts of the States is not included within those possibilities and is therefore excluded from them. While s 77(ii) contemplates the possibility that, unless and until the Commonwealth Parliament legislates under s 77(iii), the courts of the States may continue to exercise their existing adjudicative authority, if any, finally to resolve such matters, it does not contemplate that this authority – the authority characteristically exercised by courts – will be exercised by agencies of the executive government of the States. The Inconsistency Issue and the Implication Issue are distinct: the resolution of the Inconsistency Issue is not determinative of the Implication Issue, as is recognised in the approach taken by the court below and in the arguments presented to this Court. Whether Ch III denies the possibility of the conferral of adjudicative authority with respect to any of the matters listed in ss 75 and 76 of the Constitution on a tribunal that is not one of the courts referred to in Ch III by the legislature of any party to the federal compact is a question that is logically anterior to any question as to the power of the Commonwealth Parliament to override such a conferral of adjudicative authority by a State Parliament. Indeed, to treat a conclusion that the Commonwealth Parliament has no power to override such a conferral by a State Parliament as demonstrating a lacuna in the express provisions of Ch III which must be filled by implication in Bell order to give effect to Ch III is merely to beg the question as to the true effect of Ch III. Because the Implication Issue must be decided in the affirmative, it is unnecessary to resolve the Inconsistency Issue and the appeals to this Court must be dismissed. The proceedings In 2013 and 2014, Mr Garry Burns made separate complaints to the Anti-Discrimination Board of New South Wales about statements made by Ms Therese Corbett and Mr Bernard Gaynor, which Mr Burns claimed were public acts which vilified homosexuals, contrary to s 49ZT of the Anti- Discrimination Act 1977 (NSW) ("the AD Act"). The complaint against Ms Corbett was referred to the Administrative Decisions Tribunal of New South Wales. The complaint against Mr Gaynor was referred to the Civil and Administrative Tribunal of New South Wales ("NCAT"). At all material times, Mr Burns was a resident of New South Wales, Ms Corbett was a resident of Victoria and Mr Gaynor was a resident of Queensland1. The AD Act allows complaints under that Act to be referred to NCAT2. A referral having been made, NCAT is empowered to dismiss the complaint in whole or in part (ss 102 and 108(1)(a)), to find the complaint substantiated in whole or in part (s 108(1)(b)) and to make interim and final orders (ss 105 and 108(2)). Prior to the commencement of the Civil and Administrative Legislation (Repeal and Amendment) Act 2013 (NSW) on 1 January 2014, these provisions of the AD Act were in substantially the same terms as they are now, except that it was the Administrative Decisions Tribunal, rather than NCAT, to which complaints were to be referred3. By cl 3 of Sched 1 to the Civil and Administrative Tribunal Act 2013 (NSW) ("the NCAT Act"), the Administrative Decisions Tribunal was abolished on 1 January 2014, and by s 7, NCAT was established that same day. 1 Burns v Corbett (2017) 343 ALR 690 at 693 [5]. 2 Sections 90B(5), 93A, 93B, 93C, 95(2). 3 See Anti-Discrimination Act 1977 (NSW), s 4(1), definition of "Tribunal" (as at 21 June 2013). Bell Part 3 of the NCAT Act deals with the jurisdiction of NCAT. Section 29(1) provides that NCAT has "general jurisdiction" over a matter if legislation other than the NCAT Act enables NCAT to make decisions or exercise other functions in respect of that matter, and the matter does not otherwise fall within NCAT's administrative review jurisdiction, appeal jurisdiction or enforcement jurisdiction. Where NCAT has determined a matter over which it has general jurisdiction, s 80(1) allows a party to appeal against the decision to an Appeal Panel of NCAT, which is in turn invested with jurisdiction to hear such appeals It may be noted that Pt 3A of the NCAT Act commenced operation on 1 December 2017, four days before these appeals came on for hearing4. It provides a mechanism for matters to be heard by an authorised court, instead of NCAT, if, upon an application for leave by a person with standing to make it, the court is satisfied that NCAT does not have jurisdiction to determine the application because its determination involves the exercise of federal diversity jurisdiction (s 34B). It is unnecessary to consider the operation of these new provisions further in order to determine these appeals. The Administrative Decisions Tribunal found that Ms Corbett had breached the AD Act and ordered her to make a public and private apology5. She appealed unsuccessfully to the newly constituted Appeal Panel of NCAT6. The Appeal Panel's orders were entered in the Supreme Court pursuant to s 114 of the AD Act. Thereafter, Mr Burns brought separate proceedings in the Supreme Court charging Ms Corbett with contempt for failing to make either apology. As part of her defence to that charge, Ms Corbett contended that neither the Administrative Decisions Tribunal nor the Appeal Panel of NCAT had jurisdiction in the dispute, because she is a resident of Victoria. That aspect of her defence was removed to the Court of Appeal of the Supreme Court of New South Wales7. Mr Burns' complaint against Mr Gaynor has not yet been heard on the merits. Mr Gaynor succeeded in having the proceedings in NCAT dismissed on the basis that there had been no "public act" in New South Wales as required by 4 See Justice Legislation Amendment Act (No 2) 2017 (NSW), Sched 1.2 [3]. 5 Burns v Corbett [2013] NSWADT 227. 6 Corbett v Burns [2014] NSWCATAP 42. 7 Burns v Corbett (No 2) [2016] NSWSC 612. Bell s 49ZT of the AD Act8. While an appeal by Mr Burns to the Appeal Panel of NCAT was yet to be heard, some further interlocutory skirmishing between them resulted in the making of an order for costs against Mr Gaynor. Mr Gaynor obtained a grant of leave to appeal to the Court of Appeal from that order9. By a summons filed in that appeal, Mr Gaynor sought a declaration that NCAT had no jurisdiction to determine matters pertaining to citizens resident in a State other than New South Wales, as well as an order in the nature of prohibition preventing steps from being taken by Mr Burns in NCAT or to enforce its orders10. The Court of Appeal (Bathurst CJ, Beazley P and Leeming JA) heard these various matters together in order to resolve the common issue of whether NCAT may hear and determine a dispute arising under the AD Act between a resident of New South Wales and a resident of another State11. In order to understand the decision of the Court of Appeal, it is necessary to note the material provisions of the Constitution and the Judiciary Act. The Constitution Section 71 of the Constitution provides that the judicial power of the Commonwealth shall be vested in this Court, in such other federal courts as the Parliament creates, and in such other courts as the Parliament invests with federal jurisdiction. To the extent that the courts of the States are invested with federal jurisdiction by the Parliament of the Commonwealth, those courts thereby become part of the federal Judicature established under Ch III of the Constitution12. Section 75 establishes the original jurisdiction of this Court in relation to certain kinds of matters. It provides: "In all matters: arising under any treaty; 8 Burns v Gaynor [2015] NSWCATAD 211. 9 Gaynor v Burns [2016] NSWCA 44. 10 Burns v Corbett (2017) 343 ALR 690 at 694 [7]. 11 Burns v Corbett (2017) 343 ALR 690 at 693 [3]. 12 Rizeq v Western Australia (2017) 91 ALJR 707 at 713 [12]; 344 ALR 421 at 425; [2017] HCA 23. Bell affecting consuls or other representatives of other countries; (iii) in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party; between States, or between residents of different States, or between a State and a resident of another State; in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth; the High Court shall have original jurisdiction." Section 76 of the Constitution empowers the Commonwealth Parliament to confer additional original jurisdiction on this Court to determine other kinds of matters. Quick and Garran described the matters listed in s 76 as "matters of specially federal concern"13. Section 76 provides: "The Parliament may make laws conferring original jurisdiction on the High Court in any matter: arising under this Constitution, or involving its interpretation; arising under any laws made by the Parliament; (iii) of Admiralty and maritime jurisdiction; relating to the same subject-matter claimed under the laws of different States." In relation to the matters referred to in ss 75 and 76, s 77 of the Constitution empowers the Commonwealth Parliament to make laws establishing the extent of the jurisdiction of federal courts other than the High Court, and investing State courts with federal jurisdiction. Section 77 provides: "With respect to any of the matters mentioned in the last two sections the Parliament may make laws: defining the jurisdiction of any federal court other than the High Court; 13 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, Bell defining the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to or is invested in the courts of the States; (iii) investing any court of a State with federal jurisdiction." Section 73 provides ("with such exceptions and subject to such regulations as the Parliament prescribes") for the appellate jurisdiction of this Court relevantly as: "to hear and determine appeals from all judgments, decrees, orders, and sentences … of any other federal court, or court exercising federal jurisdiction; or of the Supreme Court of any State … and the judgment of the High Court in all such cases shall be final and conclusive." While Ch III does not mandate the establishment of a single federal judicial system, it does establish the federal "Judicature", which may exercise adjudicative authority with respect to the matters listed in ss 75 and 76 of the Constitution. The federal Judicature is not a uniform national court system, but it has aptly been described as an "integrated national court system"14, at the head of which this Court exercises constitutionally guaranteed appellate jurisdiction. In Re Wakim; Ex parte McNally, Gummow and Hayne JJ said15: "[W]hen it is said that there is an 'integrated' or 'unified' judicial system in Australia, what is meant is that all avenues of appeal lead ultimately to this Court and there is a single common law throughout the country. This Court, as the final appellate court for the country, is the means by which that unity in the common law is ensured." It is convenient to note here that the term "jurisdiction", as it is used in the context of Ch III16, is concerned with the exercise of adjudicative authority for the purpose of "quelling controversies about legal rights and legal obligations through ascertainment of facts, application of law and exercise, where 14 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 138; see also at 114-115; [1996] HCA 24; Rizeq v Western Australia (2017) 91 ALJR 707 at 718 [49]; 344 ALR 421 at 431. 15 (1999) 198 CLR 511 at 574 [110] (footnote omitted); [1999] HCA 27. 16 See Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142; [1907] HCA 76. Bell appropriate, of judicial discretion"17. That function is the characteristic function of the courts18, albeit that, under the constitutions of the States, adjudicative authority may be vested in organs other than those recognised as courts within Ch III of the Constitution19. A State court invested with adjudicative authority in respect of matters listed in ss 75 and 76 of the Constitution pursuant to s 77 is so invested as a "component part" of the federal Judicature for which Ch III provides20. It may be noted here with particular regard to s 77(ii) that several of the matters listed in ss 75 and 76 could not, on any view, be said to be within the adjudicative authority belonging to the courts of the States in the absence of a conferral of jurisdiction by the Commonwealth Parliament. Obvious examples are the matters referred to in s 75(iii) and (v). On the other hand, the most obvious example of a matter that, prior to Federation, would have been part of the jurisdiction that belonged to the courts of the States is a dispute between residents of the different Australian colonies. The Judiciary Act Sections 38 and 39 of the Judiciary Act were enacted pursuant to s 77(ii) and (iii) of the Constitution. Section 38 provides, subject to presently immaterial exceptions, that the jurisdiction of the High Court in certain matters shall be exclusive of that of the courts of the States. Section 39 of the Judiciary Act excludes the jurisdiction of the State courts where the High Court has original jurisdiction or where original jurisdiction can be conferred on it, and then invests the State courts with that jurisdiction subject to certain conditions and restrictions. 17 Rizeq v Western Australia (2017) 91 ALJR 707 at 719 [52]; 344 ALR 421 at 432. See also Fencott v Muller (1983) 152 CLR 570 at 608; [1983] HCA 12; South Australia v Totani (2010) 242 CLR 1 at 63 [131]; [2010] HCA 39. 18 Marbury v Madison 5 US 137 at 177 (1803); Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 35-36; [1990] HCA 21. 19 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 67, 81-82, 93, 101-102, 109, 137; H A Bachrach Pty Ltd v Queensland (1998) 195 CLR 547 at 561-562 [13]-[16]; [1998] HCA 54. 20 Le Mesurier v Connor (1929) 42 CLR 481 at 514; [1929] HCA 41; Rizeq v Western Australia (2017) 91 ALJR 707 at 717 [45]; 344 ALR 421 at 430. Bell The effect of these provisions of the Judiciary Act is that the exercise by a State court of adjudicative authority in respect of any of the matters listed in ss 75 and 76 of the Constitution, including matters between residents of different States, is an exercise of federal jurisdiction. As was explained21 in Baxter v Commissioners of Taxation (NSW): "The result is that the jurisdiction of the State Courts is now derived from a new source, with all the incidents of jurisdiction derived from that new source, one of which is an appeal in all cases to the High Court." The Court of Appeal In the Court of Appeal it was accepted by all parties that even though, in hearing and determining Mr Burns' complaints, NCAT was exercising the judicial power of the State because it was able to render a binding, authoritative and curially enforceable judgment independently of the consent of the persons against whom his complaints had been brought, NCAT was not a "court of the State"22. The Commonwealth's primary argument in the Court of Appeal was that there arises from Ch III of the Constitution an implied limitation on State legislative power that prevents a State law from conferring adjudicative authority in respect of any of the matters listed in ss 75 and 76 of the Constitution on a State administrative body as opposed to one of the "courts of the States" referred to in s 77. The Commonwealth's alternative argument was that s 39 of the Judiciary Act is inconsistent with any State law conferring adjudicative authority in respect of a matter identified in s 75 or s 76 on a State tribunal other than a court; and that such a State law is inoperative to the extent it does so by virtue of s 109 of the Constitution23. The State of New South Wales ("NSW") argued that nothing in the Constitution prevents a State law from authorising a State tribunal that is not a court from exercising State judicial power in respect of a matter of the kind described in s 75(iv) of the Constitution24. As to the Judiciary Act, NSW argued 21 (1907) 4 CLR 1087 at 1137-1138. See also PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53]; [2015] HCA 36. 22 Burns v Corbett (2017) 343 ALR 690 at 698 [29]. 23 Burns v Corbett (2017) 343 ALR 690 at 699-700 [33]. 24 Burns v Corbett (2017) 343 ALR 690 at 700 [34]. Bell that it is directed only to "courts" and not to "tribunals" other than courts, so that it does not operate inconsistently with the NCAT Act. Leeming JA, with whom Bathurst CJ and Beazley P agreed, held that no implication from the Constitution prevents State Parliaments from conferring jurisdiction on State tribunals in respect of matters falling within s 75(iv) of the Constitution, but that a State law purporting to have that effect would be inconsistent with s 39 of the Judiciary Act and, therefore, invalid to the extent of the inconsistency by virtue of s 109 of the Constitution. As to the Implication Issue, Leeming JA concluded that the very conferral by s 77 on the Commonwealth Parliament of a choice as to whether, and the extent to which, adjudicative authority in respect of matters listed in ss 75 and 76 of the Constitution should be exercised by State courts is inconsistent with an implication that the Constitution itself denies power to a State to permit adjudication of a matter referred to in s 75(iv) by any organ of the State designated by the State legislature. In his Honour's view, to the extent that the legislative power conferred by s 77 is not exercised by the Commonwealth Parliament, then the provisions of Ch V of the Constitution, notably ss 106, 107 and 108, preserve the powers and laws of the States as they were before Federation25, including the power to determine disputes between residents of different States. On the other hand, in his Honour's view, once the legislative power conferred by s 77 has been exercised, as it was by the enactment of ss 38 and 39 of the Judiciary Act, then s 109 of the Constitution ensures that any inconsistent State law is inoperative. That a matter falling within s 75(iv) might be determined otherwise than in accordance with s 39(2) would alter, impair or detract from the federal law so as to attract the operation of s 109 of the Constitution26. The appeals to this Court Mr Burns, NSW and the Attorney General for New South Wales each appealed by special leave to this Court. The Attorneys-General of the States of Queensland, Western Australia, Tasmania and Victoria intervened in the appeals, making submissions in support of NSW. 25 Burns v Corbett (2017) 343 ALR 690 at 705 [58]-[59], 706 [64]. 26 Burns v Corbett (2017) 343 ALR 690 at 709 [75]-[77]. Bell NSW and Mr Burns supported the conclusion of the Court of Appeal on the Implication Issue, arguing that the Constitution itself did not remove the "belongs to" jurisdiction of State courts recognised in s 77(ii) of the Constitution. NSW submitted that if, as is common ground, Federation did not remove the "belongs to" jurisdiction of State courts in respect of disputes between residents of different States, then a fortiori it did not remove the existing jurisdiction of State tribunals other than courts. It was argued for NSW and the interveners that the terms of s 77(ii) and (iii), and the absence of any express provision in Ch III of the Constitution denying the possibility of the conferral by a State of adjudicative authority as it may see fit, are indicative of the survival, respectively, of pre-Federation State judicial and legislative power in that regard. That indication was said to be supported by the consideration that the exercise of judicial power by tribunals other than courts was familiar at the time the Constitution was drafted. The Commonwealth submitted, pursuant to a notice of contention, that it is not to be supposed that the scheme for the adjudication of matters listed in ss 75 and 76 of the Constitution by the federal Judicature established under Ch III might be subverted by a conferral by State law of adjudicative authority in respect of such matters on an administrative body of the State. It was said that s 77(ii) itself assumes that, if adjudicative authority is to be exercised by any State body in respect of any matter listed in s 75 or s 76, that body must be a State court. The Commonwealth submitted that the argument for NSW and the interveners would permit a State Parliament to confer judicial power on a State Minister in respect of matters listed in ss 75 and 76 without any right of appeal to a court of the State and subject only to review by the Supreme Court for jurisdictional error that might then come to this Court on appeal on that limited basis. Ms Corbett and Mr Gaynor resisted the appeals on the same grounds as were advanced by the Commonwealth. In addition, they sought special leave to cross-appeal against an order of the Court of Appeal that there should be no order in their favour as to the costs of the proceedings before it. This Court refused to grant special leave in this regard on the footing that the interests of justice did not warrant the grant of special leave. The Implication Issue Common ground It is as well to begin consideration of the parties' submissions in relation to the Implication Issue by recalling what is not in dispute. First, it is common ground that the disputes between Mr Burns, and Ms Corbett and Mr Gaynor are Bell matters between residents of different States, within the meaning of s 75(iv) of the Constitution. Secondly, and most importantly, it is uncontroversial that NCAT is not a "court of a State" for the purposes of Ch III of the Constitution. It is, therefore, unnecessary to delve into the considerations that bear upon the question whether any given tribunal is to be recognised as a "court" for the purposes of Ch III of the Constitution27. In addition, the circumstance that it is common ground that NCAT is not relevantly a court means that the argument for NSW and the interveners did not seek to suggest that any material distinction could be drawn between a tribunal such as NCAT and other kinds of administrative decision-maker, including those more closely associated with the executive government of a State. The issue on which the parties are squarely divided is whether the provisions of Ch III deny the possibility that the authority to adjudicate any of the matters listed in ss 75 and 76 of the Constitution may be exercised by an organ of government which is not a court for the purposes of Ch III. Consideration of that issue must begin with a consideration of the negative implications of Ch III. The negative implications of Ch III Chapter III of the Constitution, and in particular ss 71 and 77, adopted the "autochthonous expedient"28 of allowing the Commonwealth Parliament to vest the adjudicative authority of the Commonwealth in the courts of the States in respect of the matters listed in ss 75 and 76 of the Constitution. Chapter III of the Constitution thus provides for the authoritative adjudication of these matters by a federal Judicature, a component part of which may be the courts of the States29 depending on the choices made by the Commonwealth Parliament under s 77(ii) and (iii). that, absent Commonwealth legislation excluding the adjudicative authority that otherwise Section 77(ii) recognises the possibility 27 Cf Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245 at 256-260, 267-271; [1995] HCA 10; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 76-77 [64]-[66], 82-83 [82]-[85]; [2006] HCA 44. 28 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268; [1956] HCA 10. 29 Rizeq v Western Australia (2017) 91 ALJR 707 at 717 [45]; 344 ALR 421 at 430. Bell belongs to the State courts, that authority may continue to be exercised by those courts. NSW and the interveners argued that Ch III of the Constitution does not mandate a uniform national judicature with respect to the matters listed in ss 75 and 76 of the Constitution; and that the extent to which the courts of the States are co-opted into the federal Judicature depends on the choices made by the Commonwealth Parliament under s 77(ii) and (iii) of the Constitution. It was said, echoing the view of Leeming JA, that the very existence of those choices is fatal to the implication for which the Commonwealth contended. But whatever choices may be made by the Commonwealth Parliament in this regard, adjudicative authority in respect of the matters listed in ss 75 and 76 of the Constitution may be exercised only as Ch III contemplates and not otherwise. Chapter III contemplates the exercise of adjudicative power only by this Court, by other federal courts created by the Commonwealth Parliament, by State courts invested with such power by the Commonwealth Parliament or by State courts to which such adjudicative authority belongs or in which it is invested. Accordingly, even if the Commonwealth Parliament had made no law under s 77(ii) or (iii), a State law purporting to authorise an agency of the government of a State other than a court to determine, for example, a dispute between residents of different States would be invalid because Ch III left no room for such an adjudication. In the Boilermakers' Case, in one of the seminal passages in the judicial exposition of the Constitution, Dixon CJ, McTiernan, Fullagar and Kitto JJ said30: "If attention is confined to Chap III it would be difficult to believe that the careful provisions for the creation of a federal judicature as the institution of government to exercise judicial power and the precise specification of the content or subject matter of that power were compatible with the exercise by that institution of other powers. The absurdity is manifest of supposing that the legislative powers conferred by s 51 or elsewhere enabled the Parliament to confer original jurisdiction not covered by ss 75 and 76. It is even less possible to believe that for the Federal Commonwealth of Australia an appellate power could be created or conferred that fell outside s 73 aided possibly by s 77(ii) and (iii). As to the appellate power over State courts it has recently been said in this Court: 'On the face of the provisions they amount to an express statement 30 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 272. Bell of the Federal legislative and judicial powers affecting State courts which, with the addition of the ancillary power contained in s 51(xxxix), one would take to be exhaustive': Collins v Charles Marshall Pty Ltd31. To one instructed only by a reading of Chap III and an understanding of the reasons inspiring the careful limitations which exist upon the judicial authority exercisable in the Federal Commonwealth of Australia by the federal judicature brought into existence for the purpose, it must seem entirely incongruous if nevertheless there may be conferred or imposed upon the same judicature authorities or responsibilities of a description wholly unconnected with judicial power. It would seem a matter of course to treat the affirmative provisions stating the character and judicial powers of the federal judicature as exhaustive. What reason could there be in treating it as an exhaustive statement, not of the powers, but only of the judicial power that may be exercised by the judicature?" The actual decision the Boilermakers' Case confirmed that, notwithstanding the widely held understanding up to that time32, there was no good answer to the rhetorical question with which this passage concludes. While that decision specifically denied the power of the Commonwealth Parliament to confer upon an agency of the government of the Commonwealth other than a court the authority to adjudicate that is characteristic of the courts, the approach to the interpretation of Ch III, whereby the statement of what may be done is taken to deny that it may be done otherwise, is also apt to deny the possibility that any matter referred to in s 75 or s 76 might be adjudicated by an organ of government, federal or State, other than a court referred to in Ch III. In short, Ch III recognises no other governmental institution as having the potential to exercise adjudicative authority over the matters listed in ss 75 and 76 of the Constitution. Indeed, the argument advanced by NSW and the interveners invites a response in the form of a rhetorical question similar to that asked by the majority in the Boilermakers' Case: what reason could there be in treating the arrangements made by Ch III for the adjudication of matters listed in ss 75 and 76 as an exhaustive statement only of the adjudicative authority that just happens to be exercised by the courts capable of comprising the federal Judicature referred to in Ch III? There is no good answer to this question. The terms, structure and purpose of Ch III leave no room for the possibility that adjudicative 31 (1955) 92 CLR 529 at 543; [1955] HCA 44. 32 See Wheeler, "The Boilermakers Case", in Lee and Winterton (eds), Australian Constitutional Landmarks, (2003) 160 at 163. Bell authority in respect of the matters in ss 75 and 76 might be exercised by, or conferred by any party to the federal compact upon, an organ of government, federal or State, other than a court referred to in Ch III of the Constitution. Chapter III, in providing for the establishment of the federal Judicature, is not concerned solely with the conferral of the judicial power of the Commonwealth and the limits on the conferral of that power. In the working out of the ramifications of the negative implications in Ch III of the Constitution, it is not the case "that Ch III has nothing to say … concerning judicial power other than the judicial power of the Commonwealth."33 In MZXOT v Minister for Immigration and Citizenship, Gleeson CJ, Gummow and Hayne JJ adverted34 to the effect of covering cl 5 of the Constitution, which renders the Constitution (set out in s 9 of the Commonwealth of Australia Constitution Act 1900 (Imp)35) "binding on the courts, judges, and people of every State … notwithstanding anything in the laws of any State", and observed that that which is binding "is the federal scheme manifested in the text and structure of the Constitution." It was noted that the federal scheme includes Ch III and the "various inferences which have been held to follow necessarily from that federal scheme."36 Their Honours concluded their discussion with the observation that "a State legislature may not expand or contract the scope of the appellate jurisdiction of the Court conferred by s 73; or that of the original jurisdiction conferred by s 7537."38 The inevitability of the effect of Ch III upon State judicial power was touched on by Dixon CJ, McTiernan, Fullagar and Kitto JJ in the Boilermakers' 33 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 543 [15]. See also Fencott v Muller (1983) 152 CLR 570 at 607; Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 139-143; Gould v Brown (1998) 193 CLR 346 at 444 [186]; [1998] HCA 6; Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 571-572 [66]; [2010] HCA 1. 34 (2008) 233 CLR 601 at 617-618 [19]-[20]; [2008] HCA 28. 35 63 & 64 Vict, c 12. 36 (2008) 233 CLR 601 at 618 [20]. 37 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 405 [227]; [2005] HCA 44. 38 (2008) 233 CLR 601 at 618 [20]. Bell Case itself, where their Honours said39, in a passage that warrants quotation at some length: "In a federal form of government a part is necessarily assigned to the judicature which places it in a position unknown in a unitary system or under a flexible constitution where Parliament is supreme. A federal constitution must be rigid. The government it establishes must be one of defined powers; within those powers it must be paramount, but it must be incompetent to go beyond them. The conception of independent governments existing in the one area and exercising powers in different fields of action carefully defined by law could not be carried into practical effect unless the ultimate responsibility of deciding upon the limits of the respective powers of the governments were placed in the federal judicature. The demarcation of the powers of the judicature, the constitution of the courts of which it consists and the maintenance of its distinct functions become therefore a consideration of equal importance to the States and the Commonwealth. While the constitutional sphere of the judicature of the States must be secured from encroachment, it cannot be left to the judicial power of the States to determine either the ambit of federal power or the extent of the residuary power of the States. The powers of the federal judicature must therefore be at once paramount and limited. The organs to which federal judicial power may be entrusted must be defined, the manner in which they may be constituted must be prescribed and the content of their jurisdiction ascertained. These very general considerations explain the Constitution". the provisions of Chap III of Under the demarcation of the powers of the components of the federal Judicature contemplated by Ch III, adjudicative authority in respect of matters listed in ss 75 and 76 is to be exercised only by "courts", an appeal from which to this Court is guaranteed by s 73 of the Constitution. In this way, the exercise of adjudicative authority in respect of matters listed in ss 75 and 76 in accordance with Ch III, and not otherwise, ensures that adjudication in respect of all such matters occurs consistently and coherently throughout the federation40. 39 (1956) 94 CLR 254 at 267-268. 40 See Fencott v Muller (1983) 152 CLR 570 at 607; Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 114-115, 138-143. Bell Even though the existence of State courts depends on State law, and they remain State courts when co-opted into the federal Judicature41, so that the Commonwealth Parliament must take such courts as it finds them42, the only organs of government of the States that s 77 allows to be co-opted into the federal Judicature are those which are courts43. Just as Ch III leaves no room for the Commonwealth Parliament to choose to co-opt an agency of the executive government of a State into the federal Judicature, it leaves no room for a State law to foist on the parties to a matter falling within one of the nine categories listed in ss 75 and 76 a determination by an agency of the executive government of the State. While the autochthonous expedient "left to the Commonwealth Parliament the selection of the courts in which federal jurisdiction should be invested"44, the Parliament of a State could not pre-empt any selection the Commonwealth Parliament might make by vesting adjudicative authority over a s 75 or s 76 matter in an agency of its executive government. Whether a State may sidestep its own courts as components of the federal Judicature by investing an agency of its executive government with the adjudicative authority characteristic of the courts in respect of the matters listed in ss 75 and 76 is a question that has not been squarely determined by this Court. That may not be surprising, given that it has never been suggested that such adjudication is not exclusively a matter for the courts identified in Ch III as potential components of the federal Judicature. However that may be, there are observations in the authorities which support the rejection of the argument now advanced by NSW and the interveners. In The Commonwealth v Queensland45, Gibbs J, with whom Barwick CJ, Stephen and Mason JJ agreed, observed that it is implicit in Ch III that it is not 41 R v Murray and Cormie; Ex parte The Commonwealth (1916) 22 CLR 437 at 452; [1916] HCA 58; Le Mesurier v Connor (1929) 42 CLR 481 at 495-496. 42 Federated Sawmill, Timberyard and General Woodworkers' Employes' Association (Adelaide Branch) v Alexander (1912) 15 CLR 308 at 313; [1912] HCA 42; Kotsis v Kotsis (1970) 122 CLR 69 at 109; [1970] HCA 61; Russell v Russell (1976) 134 CLR 495 at 516-517, 530, 535, 554; [1976] HCA 23. 43 Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 44 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 67. 45 (1975) 134 CLR 298 at 314-315; see also at 327-328 per Jacobs J, with whom McTiernan J agreed; [1975] HCA 43. Bell permissible for a State law to detract from this Court's functions under Ch III. The case was directly concerned with the question whether a State Parliament had power to confer upon the Judicial Committee of the Privy Council adjudicative authority in respect of matters dealt with in s 74 of the Constitution. "Legislation passed by a State which had that effect would violate the principles that underlie Ch III – that questions arising as to the limits of Commonwealth and State powers, having a peculiarly Australian character, and being of fundamental concern to the Australian people, should be decided finally in this Court … In other words, such legislation would be contrary to the inhibitions which, if not express, are clearly implicit in Ch III." Thus, a State law could not deny an appeal to this Court from a decision of a State court in respect of a matter of the kinds listed in ss 75 and 76 of the Constitution. It would be surprising if a State law could achieve indirectly what it could not achieve directly by the expedient of vesting adjudicative authority in organs of the State other than its courts. Further in this regard, it is not to the point to say that an adjudication by an agency other than a court may be amenable under State law to judicial review by the Supreme Court of the State47, and that the result of such a review might then find its way to this Court. The constitutional guarantee of an appeal contained in s 73 is (save for exceptions and regulations prescribed by the Commonwealth Parliament) peremptory in its operation; it is not dependent on the operation of State law48. In K-Generation Pty Ltd v Liquor Licensing Court, Gummow, Hayne, Heydon, Crennan and Kiefel JJ said49: "There is no doubt that, with respect to subject matter outside the heads of federal jurisdiction in ss 75 and 76 of the Constitution, the State legislatures may confer judicial powers on a body that is not a 'court of a State' and that in respect of a body that is a 'court of a State', they may confer non-judicial powers. However, consistently with Ch III, the States 46 (1975) 134 CLR 298 at 315. 47 Cf Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 573-575 [71]-[77]. 48 Wall v The King; Ex parte King Won and Wah On [No 1] (1927) 39 CLR 245 at 262; [1927] HCA 4. 49 (2009) 237 CLR 501 at 544 [153]; [2009] HCA 4. Bell may not establish a 'court of a State' within the constitutional description and deprive it, whether when established or subsequently, of those minimum characteristics of the institutional independence and impartiality identified in the decisions of this Court." It may fairly be said to be a fortiori these observations that a State may not, consistently with Ch III, confer on an executive agency of the State adjudicative authority in respect of any matter listed in s 75 or s 76 of the Constitution. Considerations of historical context and purpose the judicial power of the United States extended The argument advanced by NSW and the interveners fails to recognise the historical context, and the associated purpose, of Ch III. Article III, §2 of the Constitution of the United States, vested by Art III, §1 in the Supreme Court and the federal courts "ordain[ed]" and "establish[ed]" by Congress, to "Controversies … between Citizens of different States", because of a concern that "some state courts, in applying state law, might betray bias against nonresidents"50. In contrast, and notwithstanding the executive governments of the Australian colonies, our founders had sufficient faith in the integrity of the Australian courts that they were content to adopt the "autochthonous expedient of conferring federal jurisdiction on State courts" by federal legislation made pursuant to s 77(iii), rather than follow the lead of the United States51. Importantly in this regard, there is not the faintest suggestion in any historical materials that our founders entertained, even for a moment, the possibility that disputes as to the rights, duties and liabilities of residents of different States52 might be authoritatively adjudicated by institutions of government of the States other than their courts. It may be noted in this regard jealousies between infamous colonial the 50 Amar, America's Constitution: A Biography, (2005) at 228. See also Bank of the United States v Deveaux 9 US 61 at 87 (1809); Friendly, "The Historic Basis of Diversity Jurisdiction", (1928) 41 Harvard Law Review 483; Cowen, "Diversity Jurisdiction: The Australian Experience", (1955-1957) 7 Res Judicatae 1 at 2-3. 51 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 725, 804; Australian Temperance and General Mutual Life Assurance Society Ltd v Howe (1922) 31 CLR 290 at 330, 339; [1922] HCA 50; R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268. 52 Cf Cowen, "Diversity Jurisdiction: The Australian Experience", (1955-1957) 7 Res Bell that cl 7 of Ch III of the Draft Bill of 1891, which "substantially contained"53 the terms of s 77(ii), provided that original federal jurisdiction "may be exclusive, or may be concurrent with that of the Courts of the States."54 Insofar as the legislative history is useful to an understanding of s 77(ii) as ultimately adopted, the reference to the "Courts of the States" is instructive, as is the apparent assumption that those "Courts" would be of the same institutional character as federal courts exercising federal jurisdiction. Belonging to the "courts of the States" An aspect of the argument advanced by NSW in relation to s 77(ii) of the Constitution that deserves particular attention is the contention that at least some of the matters listed in ss 75 and 76 of the Constitution involve jurisdiction which "belonged to" the courts of the States and which was not removed by Federation. On that footing, it was said that, absent a provision such as s 39 of the Judiciary Act, such a matter could be decided in State jurisdiction by a State court. It was then said that, if Federation did not remove the "belongs to" jurisdiction of State courts, then a fortiori it did not remove the existing jurisdiction of State administrative bodies. Three points may be made in respect of this aspect of the argument. The first point is that the argument by NSW fails to attend to the negative effect of the express provisions of Ch III of the Constitution. The suggestion that the exercise of adjudicative authority by agencies of the government of a State other than its courts is unaffected by the negative implications of Ch III must be rejected for the reasons derived from this Court's jurisprudence in relation to Ch III, which is discussed above. One should not be distracted from the consideration that Ch III deals comprehensively with arrangements for the adjudication of all matters listed in ss 75 and 76 by the circumstance that the present appeals concern only matters within s 75(iv). The express provision for the exercise of adjudicative authority through courts capable of inclusion as components of the federal Judicature identified by ss 71 and 77 leaves no room for the possibility of an adjudication of any of the matters listed in ss 75 and 76 by an organ of the government which is not a court of a State that may become a component of the federal Judicature. 53 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 54 As extracted in Williams, The Australian Constitution: A Documentary History, Bell The second point to be made here is that the use of the expression "jurisdiction … which belongs to … the courts of the States" in s 77(ii) is itself a positive indication that, within the scheme of Ch III, the adjudicative authority finally to determine disputes as to the rights, duties and liabilities of parties to a matter of the kinds listed in s 75 or s 76 is the exclusive province of the courts there referred to. Section 77(ii) cannot be read as if it referred to the "jurisdiction that belongs to the courts of the States in contradistinction to the jurisdiction conferred by a State on a tribunal other than a court." The expression "jurisdiction … which belongs to … the courts of the States" in s 77(ii) refers to "courts", and necessarily excludes agencies of the executive government of the States from the scope of s 77(ii). In MZXOT v Minister for Immigration and Citizenship, Gleeson CJ, Gummow and Hayne JJ, speaking of s 77(ii), said55: "That which 'belongs to' the State courts within the meaning of s 77(ii) is the authority they possess to adjudicate under the constitutions and laws of the States56." The authority to adjudicate which "belongs to" State courts under their constitutions and laws is adjudicative authority that was characteristically exercised by courts. As was said57 by Knox CJ, Rich and Dixon JJ in Le Mesurier v Connor, "the Courts of a State are the judicial organs" of the State government. It may be noted that s 77(ii), in speaking of "jurisdiction … which belongs to or is invested in the courts of the States", substantially repeats language contained in s 4 of the Supreme Court Ordinance 1861 (WA)58, which served to establish "a Court of Judicature" in the colony of Western Australia. This provision invested in the Supreme Court of Western Australia all the powers and adjudicative authority "which belong[ed] to … the Courts of Queen's Bench, Common Pleas, and Exchequer at Westminster"59. It is tolerably clear that s 77(ii), in speaking of the jurisdiction that is "invested" in the courts of the States, is speaking of authority to adjudicate that has actually been invested in State courts by State or Imperial laws and not jurisdiction invested by the 55 (2008) 233 CLR 601 at 619 [23]. 56 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142. 57 (1929) 42 CLR 481 at 495. 58 24 Vict No 15. 59 See also Puisne Judge Act 1825 (NSW) (6 Geo IV No 16). Bell Commonwealth Parliament: that is because the investiture of jurisdiction by laws of the Commonwealth is expressly dealt with by s 77(iii). But however that may be, the point remains that adjudicative authority required by Ch III to be brought to bear in the determination of matters listed in ss 75 and 76 is that authority which is characteristically exercised by courts and, consistently with that character, is exercisable only by courts capable of inclusion in the federal Judicature. The third point to be made here relates to the argument for NSW that the absence from s 77 of any reference to administrative tribunals of the States was a deliberate omission to preserve State legislative power in relation to the conferral of adjudicative authority upon such tribunals. This argument included the suggestion that the founders were familiar with the adjudicative authority of the States being exercised by administrative tribunals prior to Federation. In this regard, particular attention was given to Wilson v Minister for Lands60 as an example of a State tribunal other than a court exercising judicial power prior to Federation. That case came before the Full Court of the Supreme Court and subsequently the Privy Council on appeal from the Land Appeal Court as a court of appeal from a Local Land Board. In delivering the advice of the Privy Council, Lord Macnaghten observed that the Land Board was a "lay tribunal"61. It is, however, also to be noted that, both in the Full Court and in the Privy Council, the Local Land Board was referred to as a court62. It is apparent that the judges before whom the case came were not at all concerned with whether the Local Land Board was to be regarded as an arm of the executive government distinct from the judiciary. Just as later commentators spoke of "tribunals" when clearly referring to courts within the meaning of Ch III63, the case was not concerned to observe the distinction which has come to be regarded as vital to our understanding of the separation of powers under our Constitution. Accordingly, Wilson's Case does not support the proposition that the founders can be taken to have deliberately omitted administrative tribunals from the negative implications of Ch III of the Constitution. The same insouciance as to the distinction, which since the Boilermakers' Case has assumed crucial 60 (1899) 20 LR (NSW) (L) 104, reversed on appeal: Minister for Lands v Wilson 61 [1901] AC 315 at 323. 62 (1899) 20 LR (NSW) (L) 104 at 110; [1901] AC 315 at 322. 63 Cowen, "Diversity Jurisdiction: The Australian Experience", (1955-1957) 7 Res Judicatae 1 at 3, 7. Bell importance64, between an administrative tribunal and a court is apparent in other pre-Federation decisions65. In any event, the existence of State administrative bodies exercising judicial power at the time of Federation cannot be decisive of the true operation of Ch III. As noted earlier, until this Court's decision in the Boilermakers' Case, it was commonly, but erroneously, understood that an administrative body, such as the Inter-State Commission or the Commonwealth Court of Conciliation and Arbitration, was capable of exercising the judicial power of the Commonwealth. The decision in the Boilermakers' Case established that the adjudicative authority of the Commonwealth was exercisable only by the courts of the federal Judicature; that being so, it became of vital importance to observe the difference between such courts and administrative tribunals for the purposes of Ch III66. True it is that neither the decision nor the reasoning in the Boilermakers' Case suggested that a State Parliament was precluded generally from conferring the adjudicative authority of a State on an organ of the State other than its courts. Within the scope of the general legislative authority of a State there can be no doubt that s 107 of the Constitution preserved the power of State Parliaments in that regard. But the question is whether Ch III withdrew from State Parliaments the power to confer adjudicative authority in respect of the matters listed in ss 75 and 76 upon agencies of the State other than its courts. That question cannot be answered in the negative by denying the now well-established distinction between courts and administrative tribunals in relation to the federal Judicature, or by asserting that s 77(ii) of the Constitution is to be understood as if, in referring to the courts of a State, it is also referring to agencies of the executive government or other agencies that are not recognisable as courts as that term is used in Ch III of the Constitution. Conclusion Sections 28(2)(a) and (c), 29(1) and 32 of the NCAT Act are invalid to the extent that they purport to confer jurisdiction upon NCAT in relation to the 64 Cf Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245; Forge v Australian Securities and Investments Commission (2006) 228 CLR 65 Ex parte Dalton (1876) 14 SCR (NSW) (L) 277 at 281; Burrey v Marine Board of Queensland (1892) 4 QLJ 151 at 152-153. 66 See Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245; Forge v Australian Securities and Investments Commission (2006) 228 CLR Bell matters between Mr Burns, and Ms Corbett and Mr Gaynor. Pursuant to s 31 of the Interpretation Act 1987 (NSW) they may be read down to avoid that conclusion so that they do not confer jurisdiction upon NCAT where the complainant and the respondent to the complaint are "residents of different States" within the meaning of s 75(iv) of the Constitution. Orders The appeals to this Court should be dismissed. In Matter Nos S183 and S185 of 2017, the appellant should pay the first respondent's costs. In Matter Nos S186, S187 and S188 of 2017, the appellant should pay the second respondent's costs. The question of constitutional principle and its answer The High Court has in the past made plain that, except with respect to the subject matters identified in ss 75 and 76 of the Constitution, a State Parliament can confer State judicial power on a State tribunal that is not a court of that State67. The ultimate question now for determination is whether the exception is warranted. My opinion is that the exception is warranted as a structural implication from Ch III of the Constitution. The implication is needed because State legislative power to confer State judicial power on a State tribunal that is not a court of a State must be denied in order to ensure the effective exercise of the legislative powers conferred on the Commonwealth Parliament by s 77(ii) and (iii) to produce by legislation the constitutionally permissible result that an exercise of judicial power with respect to a subject matter identified in s 75 or s 76 occur only under the authority of Commonwealth law, in a forum which meets the minimum characteristics of a Ch III court, so as to give rise to a judgment or order that is appealable directly to the High Court subject only to such exceptions or regulations as the Commonwealth Parliament may prescribe under s 73(ii). In the result, I agree with the conclusion and substantially with the reasoning of Kiefel CJ, Bell and Keane JJ on the Implication Issue. I think it appropriate to set out my own process of reasoning to that conclusion. That is in part because my own process of reasoning involves me first addressing the Inconsistency Issue. It is in part because I feel compelled to confront, and to explain why I reject, the premise of a discrete historical argument made by New South Wales and State interveners against the constitutional implication. Section 77 and its limits Understanding the scope and operation of s 77 and its interaction with s 73(ii) of the Constitution is impossible without first understanding some of the technical terms employed in the drafting of those provisions. The first is "matter", which encompasses a concrete controversy about legal rights existing independently of the forum in which that controversy might come to be adjudicated68. The second is "jurisdiction", which encompasses authority to 67 K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501 at 544 [153]; [2009] HCA 4. 68 In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; [1921] HCA 20; Fencott v Muller (1983) 152 CLR 570 at 603; [1983] HCA 12; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 351 [27], 352 [30]; [2016] HCA 2. adjudicate such a controversy through the exercise of judicial power69. The third is "court", which refers to an institution70 which (whatever other characteristics it might need to possess) must be capable of exercising judicial power and must meet critical minimum characteristics of independence and impartiality71. Remaining aspects of the terminology employed in the drafting of ss 73 and 77 which need to be understood are the compound references respectively to "federal jurisdiction" and to jurisdiction which "belongs to ... the courts of the States". Both allude to the source of the authority of a court to adjudicate. Federal jurisdiction is authority to adjudicate that is derived from the Constitution or a Commonwealth law. Federal jurisdiction is limited to authority to adjudicate a matter identified in s 75 or s 76. Jurisdiction which belongs to the courts of the States, equating to "State jurisdiction", is the authority of State courts to adjudicate that is derived from State Constitutions or State laws72. State jurisdiction is not limited to authority to adjudicate a "matter"73, let alone a matter identified in s 75 or s 76, although it encompasses authority to adjudicate at least some of those matters. State jurisdiction cannot simply be equated with the jurisdiction which belonged to the courts of the colonies which on federation became States. On federation, everything adjusted. State courts which had until then been colonial courts retained the same jurisdiction with which they had previously been invested under colonial Constitutions and colonial laws with respect to controversies between residents of the geographical areas of the bodies politic which had been colonies and which became States. But what had been colonial jurisdiction was transmogrified into State jurisdiction. The colonial jurisdiction 69 Rizeq v Western Australia (2017) 91 ALJR 707 at 718 [50]; 344 ALR 421 at 432; [2017] HCA 23, quoting Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142; [1907] HCA 76. 70 The Commonwealth v Hospital Contribution Fund (1982) 150 CLR 49 at 58; [1982] HCA 13. 71 North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 163 [29]; [2004] HCA 31; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 81 [78]; [2006] HCA 44; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 106 [181]-[183]; [2013] HCA 7. 72 Rizeq v Western Australia (2017) 91 ALJR 707 at 718 [50]-[51]; 344 ALR 421 at 73 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 136-137; [1996] HCA 24. Cf Minister for Works (WA) v Civil and Civic Pty Ltd (1967) 116 CLR 273 at 277-279; [1967] HCA 18. those courts had previously had with respect to controversies between residents of different colonies became State jurisdiction with respect to matters between residents of different States, a class of matters also within the original and concurrent jurisdiction of the High Court under s 75(iv) of the Constitution. The same State courts, within the limits of the subject-matter, geographical and personal jurisdiction they had previously had as colonial courts, immediately acquired new State jurisdiction in respect of classes of matters which had not previously existed. Those new classes of matters included matters within the description in s 76(i) of the Constitution of matters arising under the Constitution as well as those within the description in s 76(ii) of the Constitution of matters arising under Commonwealth laws. To what extent State courts acquired State jurisdiction with respect to matters within the remaining classes and subclasses of matters identified in ss 75 and 76 of the Constitution need not now be explored74. Complexities attributable to the continuation of Imperial laws conferring jurisdiction on State courts can also be put to one side75. The important point for present purposes is that, whatever State jurisdiction State courts had on and from federation with respect to the matters identified in ss 75 and 76 of the Constitution, the State jurisdiction of State courts became subject to displacement by a law enacted by the Commonwealth Parliament under s 77(ii) or (iii) of the Constitution. Each of those powers is quite confined in its operation. The words "[w]ith respect to" at the commencement of s 77 are words which identify the subject matter to which the specific powers conferred on the Commonwealth Parliament by s 77(i), (ii) and (iii) are directed. Those sub- sections confer powers to "defin[e]" or "invest[]" jurisdiction "[w]ith respect to" any of the matters identified in ss 75 and 76. The words "[w]ith respect to" do not expand the scope of those powers beyond identifying the subject matter to which they are directed76. The power conferred by s 77(ii) is an express power to "make laws ... defining the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to ... the courts of the States" "[w]ith respect to 74 Cf MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 617-621 [16]-[31]; [2008] HCA 28. 75 Cf McIlwraith McEacharn Ltd v Shell Co of Australia Ltd (1945) 70 CLR 175 at [1945] HCA 11; China Ocean Shipping Co v South Australia (1979) 145 CLR 172 at 204, 228-230, 243-244; [1979] HCA 57. 76 See Abebe v The Commonwealth (1999) 197 CLR 510 at 525-527 [27]-[29]; [1999] HCA 14. Cf Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 574 [110]; [1999] HCA 27. any of the matters mentioned" in ss 75 and 76. Neither in the judgment under appeal nor in the arguments of the parties and interveners was the suggestion made that s 77(ii) could be read to mean anything other than what the provision says. Although it would provide an attractively simple way of cutting through a knotty constitutional problem, I am unable to read s 77(ii) as if the words "the courts of" did not appear, or as if the words "the courts of the States" encompassed bodies that do not meet the description of a "court of a State" within s 77(iii). In that respect, I am unable to find anything to support either of those non-textual readings of s 77(ii) in case law or commentary on the implied congressional power of exclusion of State court jurisdiction under the United States Constitution, which informed the drafting of s 77(ii). The "general principle" of United States constitutional law is that "where jurisdiction may be conferred on the United States courts, it may be made exclusive where not so by the Constitution itself; but, if exclusive jurisdiction be neither express nor implied, the State courts have concurrent jurisdiction whenever, by their own constitution, they are competent to take it"77. That was at federation (and remains) the articulated extent of the principle which formed the background to the drafting of s 77(ii), nothing more78. Nor can I see that it is possible to treat s 77(ii) as extending by implication to permit the Commonwealth Parliament to exclude the adjudicatory authority of State tribunals that are not State courts. No doubt, "consistency with the principles upon which constitutional provisions are interpreted and applied demands that" the power conferred by s 77(ii) "should be given as full and flexible an operation as will cover the objects it was designed to effect"79. But the affirmative terms in which the power is conferred have express limitations. Those limitations cannot be glossed by drawing an implication. The power is confined in its terms to a power to exclude the adjudicatory authority of State courts which is derived, relevantly, from State Constitutions or State laws. The power permits the exclusion of that adjudicatory authority of State courts: (1) only with respect to matters identified in ss 75 and 76; and (2) only to the extent that, with respect to those matters, the High Court has original jurisdiction 77 Claflin v Houseman 93 US 130 at 136 (1876). 78 See generally Fallon et al, Hart and Wechsler's The Federal Courts and the Federal System, 7th ed (2015) at 412-460 ("Federal Authority and State Court Jurisdiction"); Kent and Lacy, Commentaries on American Law, rev ed (1889), vol 1 at 318-321, 395-404. 79 Bank of NSW v The Commonwealth ("the Bank Nationalisation Case") (1948) 76 CLR 1 at 349; [1948] HCA 7. under s 75 or has original jurisdiction conferred on it under s 7680 or has appellate jurisdiction under s 7381, or a federal court other than the High Court is invested with federal jurisdiction under s 77(i). The power conferred by s 77(iii) is limited to a power to invest federal jurisdiction in one or more State courts. That is to say82: "The power conferred by s 77(iii) is expressed in terms which confine it to making laws investing State Courts with Federal jurisdiction. Like all other grants of legislative power this carries with it whatever is necessary to give effect to the power itself. But the power is to confer additional judicial authority upon a Court fully established by or under another legislature. Such a power is exercised and its purpose is achieved when the Parliament has chosen an existing Court and has bestowed upon it part of the judicial power belonging to the Commonwealth." Particularly in light of the limited scope of the express power conferred by s 77(ii), I cannot see that it is possible to treat s 77(iii) as extending by implication to permit the Commonwealth Parliament to exclude the adjudicatory authority of non-court State tribunals. The existence of such an implied power of exclusion finds no support in the analysis underlying the now settled view83 that a matter answering the description of a matter within s 75 or s 76 which is not excluded from a State court's State jurisdiction under s 77(ii) by s 38 or s 39(1) of the Judiciary Act 1903 (Cth) ("the Judiciary Act") is nevertheless excluded as a consequence of the State court's investiture with federal jurisdiction under s 77(iii) by s 39(2) of the Judiciary Act. That exclusion is effected by s 109 of the Constitution, the relevant operation of which I now turn to explain. Section 109 and its limits By operation of s 109 of the Constitution, a State law which confers State jurisdiction on a State court is rendered invalid, in the sense of "suspended, 80 See Quick and Groom, The Judicial Power of the Commonwealth, (1904) at 163; Booth v Shelmerdine Bros Pty Ltd [1924] VLR 276 at 282. 81 Flint v Webb (1907) 4 CLR 1178 at 1186-1187; [1907] HCA 77. 82 Le Mesurier v Connor (1929) 42 CLR 481 at 496; [1929] HCA 41. See also Russell v Russell (1976) 134 CLR 495 at 516-517; [1976] HCA 23. 83 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53]; [2015] HCA 36. inoperative and ineffective"84, if and to the extent that the State law would otherwise operate to confer that State jurisdiction on that State court with respect to a matter with respect to which federal jurisdiction is either: (1) conferred on the High Court or a federal court and excluded from State jurisdiction by force of Commonwealth law enacted under s 77(ii); or (2) invested in a State court to the exclusion of State jurisdiction by force of Commonwealth law enacted under s 77(iii). In the case of Commonwealth law enacted under s 77(ii), the inconsistency within the meaning of s 109 lies in the Commonwealth law withdrawing an authority to adjudicate which the State law confers. In the case of Commonwealth law enacted under s 77(iii), the nature of the inconsistency within the meaning of s 109 requires a little more elaboration. To the extent that a Commonwealth law enacted under s 77(iii) results in a State law which confers State jurisdiction on a State court being rendered inoperative by operation of s 109 of the Constitution, the Commonwealth law produces that result in consequence of investing federal jurisdiction in the State court with respect to a matter or matters identified in ss 75 and 76 of the Constitution. The inconsistency within the meaning of s 109 does not lie simply in the State court being subjected to simultaneous Commonwealth and State commands to adjudicate the same controversy; the State court by determining the controversy would be able to fulfil both commands. The inconsistency lies rather in the disparity of the legal incidents of the dual sources of authority to adjudicate85. Quite apart from such conditions as the Commonwealth Parliament might validly attach to its investiture of federal jurisdiction in the State court86, and quite apart from the source of the powers of a State court exercising federal jurisdiction being different from the source of the powers of a State court exercising State jurisdiction87, a judgment or order made by the State court in the 84 Western Australia v The Commonwealth (1995) 183 CLR 373 at 464; [1995] HCA 47, quoting Butler v Attorney-General (Vict) (1961) 106 CLR 268 at 286; [1961] HCA 32. 85 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1137-1138; Ffrost v Stevenson (1937) 58 CLR 528 at 573; [1937] HCA 41; Minister for Army v Parbury Henty & Co (1945) 70 CLR 459 at 483; [1945] HCA 52; Felton v Mulligan (1971) 124 CLR 367 at 412-413; [1971] HCA 39; Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 471, 479; [1980] HCA 32. 86 Eg s 39(2)(a) of the Judiciary Act, considered in The Commonwealth v Kreglinger & Fernau Ltd and Bardsley (1926) 37 CLR 393; [1926] HCA 8, and s 39(2)(d) of the Judiciary Act, considered in Troy v Wrigglesworth (1919) 26 CLR 305; [1919] HCA 31. 87 Rizeq v Western Australia (2017) 91 ALJR 707 at 720-721 [59]-[63], 726-727 [91]; 344 ALR 421 at 434-435, 443. exercise of federal jurisdiction with respect to a matter identified in s 75 or s 76 is appealable directly to the High Court under s 73(ii) of the Constitution whereas the judgment or order of the State court in the exercise of equivalent State jurisdiction with respect to the same matter is not so appealable unless the State court is the Supreme Court of that State. For the Commonwealth law investing federal jurisdiction within that constitutional setting to have unimpeded operation, the federal jurisdiction it invests in the State court must become that court's sole operative source of jurisdiction with respect to the matter or matters concerned. The crux of the carefully reasoned judgment under appeal is the view that s 109 of the Constitution can also operate with respect to a Commonwealth law enacted under s 77(iii) to render inoperative a State law conferring State judicial power on a State tribunal that is not a court of that State on the basis that the State law "would alter, impair or detract from the conditional and universal operation of federal law"88. On the understanding that the Civil and Administrative Tribunal of New South Wales ("NCAT") is not a State court, it was held in the judgment under appeal that s 109 operated in that way on s 39(2) of the Judiciary Act to render inoperative provisions of the Civil and Administrative Tribunal Act 2013 (NSW) ("the NCAT Act") which confer State judicial power on NCAT to the extent that the State jurisdiction so conferred extends to a matter between residents of different States within s 75(iv) of the Constitution. The critical passage in the reasoning supporting that holding in the judgment under appeal was as follows89: "[T]he essence of s 39(2) is to invest federal jurisdiction conditionally ... and to do so universally, in all matters falling within ss 75 and 76. To the extent that matters falling within s 75 or s 76 are determined by the exercise of judicial power which is not qualified in the way achieved by s 39(2), that alters, impairs or detracts from the federal law." Respectfully, I disagree. If I were to assume that there is State legislative capacity to confer State jurisdiction on a State tribunal that is not a State court in a matter falling within s 75 or s 76, I would be unable to accept that s 109 of the Constitution would operate on a Commonwealth law enacted under s 77(iii) so as to invalidate a State law enacted in the exercise of that legislative capacity. I proceed to explain why. 88 Burns v Corbett (2017) 343 ALR 690 at 709 [78]. 89 Burns v Corbett (2017) 343 ALR 690 at 709 [75] (emphasis in original). The principle by reference to which inconsistency within the meaning of s 109 of the Constitution is discerned, although familiar, is usefully restated90: "Substantially, it amounts to this. When a State law, if valid, would alter, impair or detract from the operation of a law of the Commonwealth Parliament, then to that extent it is invalid. Moreover, if it appears from the terms, the nature or the subject matter of a Federal enactment that it was intended as a complete statement of the law governing a particular matter or set of rights and duties, then for a State law to regulate or apply to the same matter or relation is regarded as a detraction from the full operation of the Commonwealth law and so as inconsistent." There is, of course, no need for a State law to impinge upon the field of legal operation of the Commonwealth law in order for the State law to impair or detract from the operation of the Commonwealth law. Impairment or detraction can result from the practical effect of the State law91. It follows that a State law can impair or detract from a Commonwealth law's conferral of jurisdiction under s 76 or s 77(i) or (iii) "by directly or indirectly precluding, overriding or rendering ineffective an actual exercise of that jurisdiction"92. However, I am unable to see how a State law can impair or detract from the operation of a Commonwealth law by reason of the State law impairing or detracting from the conditional and universal operation of that Commonwealth law except to the extent that the State law has a legal operation or practical effect within the universe of the conditional legal operation of the Commonwealth law93. To say that a State law impairs or detracts from the conditional and universal operation of a Commonwealth law, so it seems to me, is necessarily to say that the Commonwealth law is properly construed as a complete or exhaustive or exclusive statement of the law governing a subject matter lying 90 Victoria v The Commonwealth (1937) 58 CLR 618 at 630; [1937] HCA 82. See to similar effect Ex parte McLean (1930) 43 CLR 472 at 483; [1930] HCA 12; Stock Motor Ploughs Ltd v Forsyth (1932) 48 CLR 128 at 136-137; [1932] HCA 40. 91 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 398-401 [196]-[209]; [2005] HCA 44. 92 P v P (1994) 181 CLR 583 at 603; [1994] HCA 20. 93 Cf The Commonwealth v Australian Capital Territory (2013) 250 CLR 441 at 454 [9], 463 [38], 467-468 [56]-[59]; [2013] HCA 55. within the limits of Commonwealth legislative power94. It is to say, using the common metaphor, that the Commonwealth law "covers the field"95. Using the common metaphor of covering the field serves to highlight the critical inquiry for the purpose of s 109 as one of determining the permissible reach of the legal operation of the Commonwealth law96: "The question thus metaphorically stated arises when one asks of a valid Commonwealth law governing a particular matter whether or not it appears that it is intended that it be the whole law on the matter, intended to deal with a topic within Commonwealth power exhaustively and completely to the entire exclusion of State law. But the metaphor of occupation of a field is of no help in the initial question, what is the extent of the field available for Commonwealth occupation." Reverting to the language of the decision under appeal, the critical question is: what are the limits of the universe? Only to the extent that a State law has a legal operation or practical effect within the universe covered by the Commonwealth law could it be said that the State law impaired or detracted from the conditional and universal operation of the Commonwealth law. "To legislate upon a subject exhaustively" is "an exercise of legislative authority different in kind from a bare attempt to exclude State concurrent power from a subject the Federal legislature has not effectively dealt with by regulation, control or otherwise. It is still more widely different from an attempt to limit the exercise of State legislative power so that the Commonwealth should not be consequentially affected in the ends it is pursuing."97 Translated to the immediate context, to say that the conferral of State jurisdiction on a State tribunal that is not a State court with respect to a matter identified in s 75(iv) of the Constitution would alter, impair or detract from the conditional and universal operation of s 39(2) of the Judiciary Act is to say that, in enacting s 39(2) of the Judiciary Act, the Commonwealth Parliament has made a complete or exhaustive or exclusive statement of the law with respect to a 94 Cf Ex parte McLean (1930) 43 CLR 472 at 483. 95 See Momcilovic v The Queen (2011) 245 CLR 1 at 116-119 [262]-[265]; [2011] HCA 34; Jemena Asset Management (3) Pty Ltd v Coinvest Ltd (2011) 244 CLR 508 at 524 [40]; [2011] HCA 33. 96 Airlines of NSW Pty Ltd v New South Wales [No 2] (1965) 113 CLR 54 at 156; [1965] HCA 3. 97 Wenn v Attorney-General (Vict) (1948) 77 CLR 84 at 120; [1948] HCA 13. subject matter which includes the institutions able to exercise jurisdiction with respect to matters identified in ss 75 and 76 of the Constitution. It is necessarily to say that the Commonwealth Parliament has not only provided positively for the conditional investiture of federal jurisdiction in State courts but has also stipulated negatively for the non-investiture of any jurisdiction with respect to any of those matters other than in State courts. Leaving aside the textual difficulty of construing s 39(2) of the Judiciary Act to have such a negative penumbra, the fundamental problem with that approach to the invocation of s 109 of the Constitution to render inoperative a State law investing State jurisdiction in a State tribunal that is not a State court lies in the need to find a source of Commonwealth legislative power. Section 39(2) of the Judiciary Act can go no further than investing a State court with federal jurisdiction, because the legislative power conferred by s 77(iii) goes no further. Neither s 77(iii) nor any other provision of the Constitution enables the Commonwealth Parliament to confer judicial power on a tribunal that is not a State court98. Neither s 77(iii) nor any other provision of the Constitution enables the Commonwealth Parliament to make its conferral of federal jurisdiction on a State court exhaustive of the judicial power of a tribunal that is not a State court. The legislative powers conferred on the Commonwealth Parliament by ss 76 and 77 are complemented, as distinct from supplemented99, by s 51(xxxix) of the Constitution. In so far as s 51(xxxix) might be thought relevant, it is a provision expressed to confer power to make laws with respect to "matters incidental to the execution of any power vested by [the] Constitution in the Parliament ... or in the Federal Judicature". Although it has a superficial similarity to the "necessary and proper" clause in Art I §8 of the Constitution of the United States, s 51(xxxix) has long been understood to have a much more closely confined operation100. Being confined, relevantly, to matters incidental to the execution of the legislative power vested in the Commonwealth Parliament by s 77 or matters incidental to the execution of the judicial power vested in a court by s 71 as a consequence of s 75 or of a law enacted under s 76 or s 77, s 51(xxxix) has been held to be incapable of supporting: denial by the Commonwealth Parliament of a conferral of State judicial power on a State 98 Silk Bros Pty Ltd v State Electricity Commission of Victoria (1943) 67 CLR 1 at 9, 18, 21, 23; [1943] HCA 2; R v Kirby; Ex parte Boilermakers' Society of Australia ("the Boilermakers' Case") (1956) 94 CLR 254 at 270; [1956] HCA 10; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 73 [56]. 99 Cf Duncan v State of Queensland (1916) 22 CLR 556 at 624-625; [1916] HCA 67. 100 Le Mesurier v Connor (1929) 42 CLR 481 at 497. Cf Rizeq v Western Australia (2017) 91 ALJR 707 at 726-727 [90]-[91]; 344 ALR 421 at 442-443. court101; conferral by the Commonwealth Parliament of Commonwealth judicial power on a State court102; conferral by the Commonwealth Parliament of Commonwealth non-judicial power on a State court103; and acceptance by the Commonwealth Parliament of conferral of State judicial power on a federal court104. Much less can s 51(xxxix) support denial by the Commonwealth Parliament of a conferral of State judicial power on a tribunal which is not a court and which for that reason is not and could not be the recipient of a conferral of Commonwealth judicial power. The implication and its necessity The threshold for implying a non-textual constitutional limitation on the ambit of legislative power of the character presently under consideration is that the limitation be "logically or practically necessary for the preservation of the integrity of [the constitutional] structure"105. The determinative question is whether denial of State legislative power to confer State judicial power with respect to a matter identified in s 75 or s 76 on a State tribunal that is not a State court meets that threshold. For the reasons I have given in explaining the limits of s 77 and in rejecting the approach adopted in the decision under appeal to the application of s 109, that question falls to be considered against the background of an absence of Commonwealth legislative power to achieve the same result. If the existence of State legislative power to confer State judicial power with respect to a matter identified in s 75 or s 76 other than on a State court would mean that there is a hole in the structure of Ch III, there would be no option but to accept the existence of that hole as part of a flawed constitutional design. The Commonwealth Parliament would have no capacity to plug it. 101 Williams v Hursey (1959) 103 CLR 30 at 113; [1959] HCA 51. See also at 88-89. 102 Willocks v Anderson (1971) 124 CLR 293 at 299; [1971] HCA 28. See also Boilermakers' Case (1956) 94 CLR 254 at 269-270. 103 Queen Victoria Memorial Hospital v Thornton (1953) 87 CLR 144 at 151-152; [1953] HCA 11. 104 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 575 [111], 577-579 [114]- 105 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 135; [1992] HCA 45; McGinty v Western Australia (1996) 186 CLR 140 at 168- 169; [1996] HCA 48. the Constitution, the manner already described, The necessity for the implication, in my opinion, arises as follows. Within the structure of Ch III of the Constitution, the legislative powers conferred on the Commonwealth Parliament by s 77(ii) and (iii) operate in conjunction with s 109 the Commonwealth Parliament to produce the result that any matter identified in s 75 or s 76 can be adjudicated in the exercise of federal jurisdiction by a federal court or a State court to the exclusion of such State jurisdiction as might be conferred on a State court by the Parliament of a State. A constitutionally mandated condition of legislation attaining that constitutionally permissible result is that the federal court or State court with federal jurisdiction to adjudicate the matter is to have and maintain the minimum characteristics of independence and impartiality required of a Ch III court. to enable that The automatic constitutional consequence of attainment of constitutionally permissible result is then that any judgment or order of the federal court or State court made in the exercise of that federal jurisdiction is appealable to the High Court under s 73(ii), subject to such exceptions or regulations as the Commonwealth Parliament might prescribe. The language of s 73(ii) makes clear that "no exceptions of or regulations of the power [of the High Court to hear and determine such appeals] can be recognized unless they are made by Parliament"106. To the extent that the exercise of either of the powers conferred on the Commonwealth Parliament by s 77(ii) or (iii) results in a State law conferring State jurisdiction with respect to a matter under s 75 or s 76 being rendered inoperative, s 73(ii) accordingly operates to ensure that any judgment or order made in the exercise of a corresponding conferral of federal jurisdiction under s 77(i) or (iii) is appealable to the High Court subject only to such exceptions or regulations as are prescribed by the Commonwealth Parliament alone. The practical significance of a judgment or order made by a federal court or a State court in the exercise of federal jurisdiction being appealable to the High Court under s 73(ii) has diminished with the ultimate abolition by the Australia Act 1986 (Cth) of the alternative of an appeal to the Judicial Committee of the Privy Council and with recognition in 2010 of the constitutional entrenchment of the supervisory jurisdiction of a State Supreme Court to remedy jurisdictional error107. But its significance has by no means abated. Subject only to such exceptions or regulations as the Commonwealth Parliament alone might choose to prescribe, the appeal for which s 73(ii) provides is an appeal on all questions of fact and law arising in a matter within federal jurisdiction: "any act 106 Wall v The King; Ex parte King Won and Wah On [No 1] (1927) 39 CLR 245 at 262; [1927] HCA 4. 107 Kirk v Industrial Court (NSW) (2010) 239 CLR 531; [2010] HCA 1. of the Court upon which [the] judgment or order is based is examinable ... to determine its correctness"108. The High Court in its appellate jurisdiction is able to do complete justice in determining the matter under appeal by itself rendering the judgment or making the order which it considers on the merits should have been made by the court from which the appeal is brought. The constitutional structure which enables attainment of that constitutionally permissible result, subject to that constitutionally mandated condition and with that automatic constitutional consequence, would be undermined to a significant extent were a State Parliament able to confer State jurisdiction with respect to a matter identified in s 75 or s 76 on a State tribunal that is not a State court. Were a State Parliament to have that power, the Commonwealth Parliament's exclusion by a law enacted under s 77(ii) or (iii) of the State jurisdiction conferred on a State court could be circumvented by the simple expedient of conferring equivalent State jurisdiction on a State tribunal. The State tribunal would not need to have the minimum characteristics of independence and impartiality required of a Ch III court. The State tribunal's judgments or orders would not need to be subject to any appeal on any question of fact or law to any court, much less the High Court. The tribunal would need to be subject only to the constitutionally entrenched supervisory jurisdiction of the Supreme Court of the State. The Supreme Court in the exercise of that supervisory jurisdiction would be able to grant an appropriate remedy only if the tribunal were to exceed or to fail to exercise the State jurisdiction conferred on it. I do not think that I am venturing down the forbidden path of construing the Constitution by reference to "distorting possibilities"109 in choosing to illustrate those undermining effects by hypothesising the position of a State Commission constituted by State legislation in the same manner, and capable of exercising within a State the same judicial power with respect to the same classes of subject matter, as the ill-fated Inter-State Commission established in its original form by Commonwealth legislation110. There would be created "a investigating curiously anomalous body" combining department, the prosecuting authority, the Court and the Sheriff's department"111. That curiously anomalous body would be immune from appeal to any court in respect of any coercive order it might make in consequence of any adjudication it might undertake with respect to a matter identified in s 75 or s 76, including a functions of "the 108 Riley v Nelson (1965) 119 CLR 131 at 154; [1965] HCA 62. 109 See Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 43 [32]; [2003] HCA 72. 110 Inter-State Commission Act 1912 (Cth). 111 New South Wales v The Commonwealth (1915) 20 CLR 54 at 109; [1915] HCA 17. matter to which the Commonwealth is a party112, a matter arising under Commonwealth law or a matter arising under the Constitution or involving its interpretation. Despite the terms of s 101 of the Constitution, the High Court has held that creation of such a body is denied to the Commonwealth Parliament113. Compounding both the curiosity and the anomaly, creation of such a body would nevertheless be allowed to a State Parliament. To the extent that denial of State legislative power to confer State judicial power with respect to a matter identified in s 75 or s 76 on a non-court State tribunal is protective of the ability of the Commonwealth Parliament to invoke the appellate jurisdiction of the High Court under s 77(iii) with respect to such a matter, its implication was foreshadowed in reasoning which supported the unanimous decision of the High Court in 1975114 holding invalid a State law enacted two years prior. The State law held invalid purported to confer on the Privy Council jurisdiction to consider and advise the Queen on "questions or matters which, whether as part of any cause or otherwise, and whether in the course of any proceedings in any court in [the State] or otherwise, arise under or concern any law in force in [the State] ... or which otherwise substantially relate to the peace, welfare and good government of [the State]"115. The reasoning of four members of the High Court was contained in the reasons for judgment of Gibbs J116. Having noted that, at federation, s 74 of the Constitution had the effect that "no appeal was to be permitted to the Judicial Committee from a decision of this Court upon any question ... as to the limits inter se of the constitutional powers of the Commonwealth and those of any State or States, unless this Court should certify that the question is one which ought to be determined by the Judicial Committee"117 and that "the provisions of [Ch III] enabled the Parliament by appropriate legislation to achieve the result that all of the matters mentioned in ss 75 and 76 of the Constitution (except possibly inter se questions) should be finally decided in this Court and not in the Judicial 112 Cf Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410; [1997] HCA 36. 113 New South Wales v The Commonwealth (1915) 20 CLR 54. 114 The Commonwealth v Queensland (1975) 134 CLR 298; [1975] HCA 43. ("the Queen of Queensland Case") 115 Section 3 of the Appeals and Special Reference Act 1973 (Q). 116 Queen of Queensland Case (1975) 134 CLR 298 at 303, 316. 117 Queen of Queensland Case (1975) 134 CLR 298 at 313. Committee"118, his Honour stated that "[i]t is implicit in Ch III that it is not permissible for a State by legislation to provide a procedure by which the Judicial Committee is enabled to consider an inter se question in the absence of a certificate of this Court, or any other matter arising in the exercise of federal jurisdiction when the Parliament has exercised its power to prevent any appeal being brought to the Judicial Committee from a decision of this Court or a State court on any such matter"119. limitation on State legislative power was contingent on Whilst that statement might perhaps be interpreted as suggesting that the the implied Commonwealth Parliament having first legislated to achieve the result that all of the matters mentioned in ss 75 and 76 be appealable to the High Court under s 73(ii), such an interpretation would not readily explain the outcome of his Honour's reasoning. The outcome was to deny the validity of the State law in its application purportedly to authorise seeking from the Privy Council an advisory opinion as to whether the legislative power of the State extended to enacting its own Royal Style and Titles Act in opposition to the Royal Style and Titles Act 1973 (Cth). That purported conferral of authority was beyond the scope of any legislation which the Commonwealth Parliament had enacted, or could have enacted, with respect to any matter mentioned in s 75 or s 76, both because it was in respect of an advisory opinion and because the Privy Council was neither a federal nor a State court. The outcome was produced by a negative implication that was necessary to give efficacy to the Commonwealth legislative powers which his Honour identified. The separate reasons for judgment of Jacobs J, with whom McTiernan J substantially agreed120, were unambiguous in basing the invalidating implication on an absence of State legislative power which arose from the structure of Ch III irrespective of any exercise of Commonwealth legislative power. His Honour found in Ch III "an exhaustive statement of the kind of judicial power which may be conferred or exercised in respect of the subject matters set out in ss 75 and 76"121. Judicial power as envisaged by Ch III with respect to the subject matters identified in ss 75 and 76 was relevantly confined to judicial power of a kind that could be exercised only in respect of justiciable controversies answering the constitutional description of "matters"122. 118 Queen of Queensland Case (1975) 134 CLR 298 at 314. 119 Queen of Queensland Case (1975) 134 CLR 298 at 314-315. 120 Queen of Queensland Case (1975) 134 CLR 298 at 303. 121 Queen of Queensland Case (1975) 134 CLR 298 at 328. 122 Queen of Queensland Case (1975) 134 CLR 298 at 327-329. His Honour's reasoning did not deny the capacity of a State Parliament to confer State jurisdiction with respect to a subject matter identified in s 75 or s 76 of the Constitution. What it denied was the capacity of a State Parliament to confer judicial power with respect to a subject matter identified in s 75 or s 76 other than by conferring State jurisdiction with respect to a "matter" identified in s 75 or s 76. His Honour's holding was that the implication from Ch III which he identified denied to the Queensland Parliament legislative capacity to confer on the Privy Council State jurisdiction to give an advisory opinion on subject matters falling within ss 75 and 76. His Honour's reasoning and conclusion is wholly consistent with the constitutional implication now confirmed. Consistently with the reasoning of both Gibbs J and Jacobs J, the constitutional implication applicable to the resolution of this case is that judicial power with respect to the subject matters identified in ss 75 and 76 of the Constitution is confined to judicial power of a kind that is: (1) exercisable in respect of justiciable controversies answering the constitutional description of "matters"; and (2) conferred on or invested in institutions answering the constitutional description of "courts". With respect to the subject matters identified in ss 75 and 76, the Commonwealth Parliament and State Parliaments each lack legislative power to confer or invest judicial power of any other kind. History and its limits History is important to constitutional interpretation. That is because the traditional Constitution was framed against conceptions"123, and because the colonial context in which the Constitution was forged can illuminate its purposes and can expose nuances of potential meaning not obvious from its text124. But concentration on historical minutiae can distract from the discernment and exposition of constitutional principle. the background of "many In arguing against the constitutional implication denying State legislative power to confer State judicial power with respect to a subject matter identified in s 75 or s 76 on a non-court State tribunal, a consideration of historical detail on which New South Wales and State interveners placed considerable emphasis concerned the position of Local Land Boards established under the Crown Lands Act 1884 (NSW). New South Wales and State interveners argued that the implication would have jeopardised part of the functioning of those Local Land 123 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193; [1951] HCA 5. See also Palmer v Ayres (2017) 259 CLR 478 at 495-496 [42]; [2017] HCA 5. 124 Cole v Whitfield (1988) 165 CLR 360 at 385; [1988] HCA 18. Boards. That consideration appears to have been treated in the decision under appeal as supporting rejection of the implication125. Without descending unassisted into the complex and otherwise redundant legal analysis and factual inquiry which would need to be undertaken were it necessary to decide126, I am prepared to make a number of contestable assumptions about Local Land Boards. The assumptions are as follows. Before federation, they exercised judicial power127, including on occasions with respect to disputes between residents of different colonies. On federation, they were not They nevertheless continued able to be characterised as State courts. immediately after federation to exercise judicial power, including again on occasions with respect to disputes between residents of different States. They did so oblivious to any constitutional impediment. Although again unassisted by argument, I am also prepared to entertain the possibility that other entities established under colonial legislation may have had similar characteristics and may have behaved in a similar manner before and after federation. Legislative, judicial and administrative practices occurring since federation are by no means irrelevant to constitutional interpretation. "Every public officer, every citizen, has daily to interpret the law for himself; and the common consent of the community, operating over a long period of time, can establish a practice and a tradition of constitutional interpretation which may act as a gloss on the text of the Constitution, and carry weight with its authentic interpreters."128 Indeed, "[s]uch matters as judicial dicta, common assumptions tacitly made and acted upon, and the fact that legislation has passed unchallenged for a considerable period of time, may be regarded as raising a presumption which should prevail until the judicial mind reaches a clear conviction that consistently with the Constitution the validity of the provisions impugned cannot be sustained"129. But practices adopted by State entities in the administration of former colonial legislation during the early years following federation without apparent 125 Burns v Corbett (2017) 343 ALR 690 at 705 [59]. 126 See generally Lang, Crown Land in New South Wales, (1973) at 10-12 [109]-[111], 127 Cf Wilson v Minister for Lands (1899) 20 LR (NSW) (L) 104 at 109, 123; Minister for Lands v Wilson [1901] AC 315 at 322-323. 128 Garran, "The Development of the Australian Constitution", (1924) 40 Law Quarterly Review 202 at 203. 129 Boilermakers' Case (1956) 94 CLR 254 at 296. advertence to the potential impact of the Constitution carry no interpretative weight at all. Post-federation practices of that dubious nature do not gain interpretative weight by being portrayed as indicative of pre-federation expectations. They cannot be bootstrapped into significance on the basis that they were a continuation of pre-federation practices which those involved or others with oversight of those involved might be assumed in light of their later conduct or lack of intervention to have expected to continue. I reiterate: on federation, everything adjusted. Sections 107 and 108 of the Constitution recognised as much in the qualified terms in which they respectively continued colonial legislative power as State legislative power and continued colonial legislation as State legislation. To the extent that colonial legislation could be worked conformably with the text and structure of the Constitution, colonial legislation continued after federation as State legislation. To the extent that colonial legislation could not be worked conformably with the text and structure of the Constitution, colonial legislation ceased to operate130. That a particular adjustment judicial or administrative practice may not have been immediately perceived or immediately implemented does not mean that the adjustment was not warranted by the Constitution. Appreciation of the express terms of the Constitution has taken time. So has the unfolding of its implications. legislative or to State Observations made by the Chief Justice at the first sitting of the High Court, nearly three years after federation, were prescient131: "I think it will be some time before the profession and the public fully realise the extent of the power of criticism and determination that is vested in this Court with respect to the decrees of the State and Federal Legislatures. Enormous and difficult questions will arise, and it is not to be expected that our decisions will meet the views of all parties." Not to be forgotten is that the "struggle for standards"132 in the interpretation of the Constitution in the first two decades after federation was manifested in disagreement about two very large constitutional implications which commended themselves to an early majority of the High Court: the supposed immunity of Commonwealth and State instrumentalities each from legislative interference by the other, and the supposed reservation of State legislative power over intra-State trade to the exclusion of Commonwealth 130 Eg Fox v Robbins (1909) 8 CLR 115 at 129-130; [1909] HCA 81. 131 The Sydney Morning Herald, 16 October 1903 at 3. 132 Stellios, Zines's The High Court and the Constitution, 6th ed (2015), ch 1. legislative power. Then, in 1920133, "the Constitution was read in a new light, a light reflected from events that had, over twenty years, led to a growing realization that Australians were now one people and Australia one country"134. The earlier implications were abandoned as unwarranted and unworkable, opening the way for judicial recognition, revision and refinement of more targeted structural implications to occur over the ensuing century. That is the ongoing task in which we are presently engaged. There is no reason in constitutional principle why a structural implication must be shown to accord with pre-federation expectations, or be shown to be likely to have been recognised by some actual or notional office holder or other potential litigant at the time of federation, in order for that structural implication now to be judicially recognised or confirmed. The Constitution was not framed for the moment of its creation, but as an enduring instrument of government. "Experience derived from the events that have occurred since its enactment may enable us to see more in the combination of particular words, phrases or clauses or in the document as a whole than would have occurred to those who participated in the making of the Constitution."135 The function and duty of the judiciary, as "a living co-ordinate branch of the Government"136, is to interpret the Constitution in light of that experience and to do so consistently with developments in constitutional doctrine that have been expounded over the years that have passed since federation. Judicial explication of the Constitution has sometimes disappointed expectations and has sometimes called past practices into question. That it will continue on occasions to do so is almost inevitable if the judiciary is to continue to perform its constitutional function of interpreting the Constitution only as and when required in the context of determining controversies that are truly controversial. Telling, however, is the fact that it was found necessary to hark back to the very early years of federation for an example of what was asserted to be an established practice which would have been jeopardised by recognition of the 133 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd ("the Engineers Case") (1920) 28 CLR 129 at 163; [1920] HCA 54. 134 Victoria v The Commonwealth ("the Payroll Tax Case") (1971) 122 CLR 353 at 396; [1971] HCA 16. See also New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 119 [193]; [2006] HCA 52. 135 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 553 [46] (footnote omitted). 136 The Commonwealth v Kreglinger & Fernau Ltd and Bardsley (1926) 37 CLR 393 implication now under consideration. To no-one who has studied the course of the High Court's exegesis of Ch III over the past half-century137, who has had regard to the considered reasoning of intermediate appellate courts during the past decade138, or who leading contemporary academic commentary139, could confirmation by implied constitutional denial of State legislative power to confer State judicial power with respect to a subject matter identified in s 75 or s 76 on a non-court State tribunal now come as a surprise. the High Court of an is abreast of Conclusion and orders On the unchallenged assumption that NCAT is not a State court, the implied constitutional exclusion of State legislative power to confer State judicial power on a non-court State tribunal has consequences for the provisions of the NCAT Act which purport to confer State judicial power on NCAT. The provisions are invalid to the extent that they purport to confer State judicial power with respect to subject matters identified in ss 75 and 76 of the Constitution. The provisions can and should be read down pursuant to s 31 of the Interpretation Act 1987 (NSW) to exclude conferral of State judicial power with respect to those subject matters140. That reading down is to be achieved with respect to matters arising under the Anti-Discrimination Act 1977 (NSW) ("the AD Act") between residents of different States within s 75(iv) of the Constitution by excluding from the jurisdiction conferred on NCAT by the NCAT Act authority to determine a complaint by a resident of one State that a resident of another State contravened a provision of the AD Act. The appeals should be disposed of by making the orders proposed by Kiefel CJ, Bell and Keane JJ. 137 Since Boilermakers' Case (1956) 94 CLR 254. 138 See Attorney-General (NSW) v 2UE Sydney Pty Ltd (2006) 236 ALR 385 at 395- 396 [55]-[56], 399 [76]-[77], 400 [87]-[89], 400-401 [93]; The Commonwealth v Anti-Discrimination Tribunal (Tasmania) (2008) 169 FCR 85 at 130 [201], 137- 139 Lindell, Cowen and Zines's Federal Jurisdiction in Australia, 4th ed (2016) at 309- 140 See Tajjour v New South Wales (2014) 254 CLR 508 at 585-586 [168]-[171]; [2014] HCA 35. Nettle 122 NETTLE J. These are appeals from a judgment of the Court of Appeal of the Supreme Court of New South Wales (Bathurst CJ, Beazley P and Leeming JA) in which it was held that the Civil and Administrative Tribunal of New South Wales did not have jurisdiction under s 49ZT of the Anti-Discrimination Act 1977 (NSW) to resolve complaints made by a resident of one State against residents of other States141. The principal issue is whether the Constitution prohibits a State tribunal which is not a "court of a State" within the meaning of s 77(iii) of the Constitution ("a non-court State tribunal") resolving matters between residents of different States in the exercise of State jurisdiction. I have had the advantage of reading in draft the reasons for judgment of Gordon J and with respect agree with her Honour's conclusions. It is appropriate nonetheless that I explain the reasons which have brought me to that point. At the outset, it is necessary to observe that in Ch III of the Constitution the term "jurisdiction" refers to the authority to adjudicate upon a class of questions concerning a particular subject matter. State jurisdiction is the authority which State courts possess to adjudicate under the State Constitution and laws and federal jurisdiction is the authority to adjudicate derived from the Commonwealth Constitution and laws. The former is that which "belongs to" State courts within the meaning of s 77 of the Constitution and the latter is that which is invested in State courts by the Commonwealth Parliament142. Section 71 of the Constitution invests the judicial power of the Commonwealth in the High Court of Australia. Section 75 confers original jurisdiction on the High Court in five kinds of matter, of which the fourth includes the relevant head of matters between residents of different States. to confer original the Commonwealth Parliament Section 76 empowers jurisdiction on the High Court in a further four kinds of matter. Section 77 provides with respect to any of the matters mentioned in s 75 or s 76 that the Parliament may make laws: (i) defining the jurisdiction of any federal court other than the High Court in relation to the matters; (ii) defining the extent to which the jurisdiction of any federal court shall be exclusive of the jurisdiction which "belongs to or is invested in" State courts; and (iii) investing any State court with federal jurisdiction. Together, these several provisions of Ch III of the Constitution empower the Parliament to enact an integrated system of federal and State courts for the adjudication of ss 75 and 76 matters in the exercise of federal 141 Burns v Corbett (2017) 343 ALR 690 at 714 [101], 716 [109]-[110] per Leeming JA (Bathurst CJ and Beazley P agreeing at 693 [1], [2]). 142 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142 per Isaacs J; [1907] HCA 76; CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 349 [24] per French CJ, Kiefel, Bell and Keane JJ; [2016] HCA 2. Nettle jurisdiction, to the exclusion of the State jurisdiction of State courts143, exhaustive of the manner in and extent to which federal jurisdiction may be so exercised by any federal or State court144. As was observed in Grannall v Marrickville Margarine Pty Ltd145: "[E]very legislative power carries with it authority to legislate in relation to acts, matters and things the control of which is found necessary to effectuate its main purpose, and thus carries with it power to make laws governing or affecting many matters that are incidental or ancillary to the subject matter." Such authority to legislate for controls necessary to effectuate the main purpose of a power is an implied incidental power which is distinct and separate from, and broader than, the incidental power granted to the Parliament under s 51(xxxix) of the Constitution to make laws with respect to matters which are 143 See Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 83-84 per Dawson J (Brennan CJ relevantly agreeing at 65), 101-103 per Gaudron J, 110- 112, 114-115 per McHugh J, 138-143 per Gummow J; [1996] HCA 24. 144 See R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268, 270 per Dixon CJ, McTiernan, Fullagar and Kitto JJ; [1956] HCA 10; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 405-406 [227]- [230] per Gummow J; [2005] HCA 44; MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 618 [20] per Gleeson CJ, Gummow and Hayne JJ; [2008] HCA 28; Alqudsi v The Queen (2016) 258 CLR 203 at 265-266 [167]-[171] per Nettle and Gordon JJ; [2016] HCA 24; Rizeq v Western Australia (2017) 91 ALJR 707 at 719-720 [58]-[62] per Bell, Gageler, Keane, Nettle and Gordon JJ; 344 ALR 421 at 434-435; [2017] HCA 23. 145 (1955) 93 CLR 55 at 77 per Dixon CJ, McTiernan, Webb and Kitto JJ; [1955] HCA 6. Nettle incidental to the execution of the legislative power146. Mason CJ made the point in Nationwide News Pty Ltd v Wills147 thus: "Each specific grant of legislative power in the Constitution extends to all matters incidental to the subject matter of the power which are 'necessary for the reasonable fulfilment of the legislative power' over that subject matter. Or, to put it another way, the specific substantive power extends to matters 'the control of which is found necessary to effectuate its main purpose'. On the other hand, s 51(xxxix) is directed not so much to matters incidental to the nominated subject of legislative power but rather to the execution of the various powers vested in the three branches of government. ... If one thing emerges clearly from the decisions of this Court it is that, to bring a law within the reach of the incidental scope of a power, it is enough that the provision is appropriate to effectuate the exercise of the power; one is not confined to what is necessary for the effective exercise of the power." (footnotes omitted) The express grant of legislative power comprised in s 77 of the Constitution to enact laws investing federal jurisdiction in State courts in relation to ss 75 and 76 matters and defining the extent to which the jurisdiction of any federal court is exclusive of that which "belongs to or is invested in" State courts incidental and therefore draws with it, unexpressed but consequential, 146 See Le Mesurier v Connor (1929) 42 CLR 481 at 496-497 per Knox CJ, Rich and Dixon JJ; [1929] HCA 41; Burton v Honan (1952) 86 CLR 169 at 177-178 per Dixon CJ; [1952] HCA 30; Attorney-General (WA) v Australian National Airlines Commission (1976) 138 CLR 492 at 514-515 per Stephen J; [1976] HCA 66. See and compare G G Crespin & Son v Colac Co-operative Farmers Ltd (1916) 21 CLR 205 at 212 per Griffith CJ, 214 per Barton J; [1916] HCA 13. See also M'Culloch v State of Maryland 17 US 316 at 406, 421, 426 (1819); Anderson v Dunn 19 US 204 at 225-226 (1821). 147 (1992) 177 CLR 1 at 26-27; [1992] HCA 46. See also Victoria v The Commonwealth (1996) 187 CLR 416 at 548-549 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ; [1996] HCA 56; Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 579-581 [118]-[122] per Gummow and Hayne JJ; [1999] HCA 27. See and compare Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 133-135 per Mason CJ; [1992] HCA 45; McGinty v Western Australia (1996) 186 CLR 140 at 168-170 per Brennan CJ; [1996] HCA 48; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 452-454 [385]-[389] per Hayne J. Nettle appropriate to its exercise, the power to prohibit State courts continuing to adjudicate such matters in the exercise of State jurisdiction. Although s 77 of the Constitution arms the Commonwealth Parliament with legislative power to provide that matters falling within ss 75 and 76 should be determined by federal and State courts in the exercise of federal jurisdiction to the exclusion of the State jurisdiction of State courts, Ch III of the Constitution, as enacted, left extant the "belongs to" State jurisdiction of State courts and such other State jurisdiction as might be invested in State courts by State Parliaments to adjudicate matters of the kind enumerated in ss 75 and 76148. Thus, until Parliament invoked the legislative power conferred under s 77, State courts and non-court State tribunals invested with State judicial power remained free to adjudicate matters falling within ss 75 and 76 in the exercise of State jurisdiction (apart from some matters, such as claims for mandamus against an officer of the Commonwealth under s 75(v), which were unknown prior to Federation)149. As will be explained, it was only upon the enactment of s 39(2) of the Judiciary Act 1903 (Cth) that federal jurisdiction to adjudicate matters of the kind identified in ss 75 and 76 was invested in State courts and that it came to be accepted that the State jurisdiction of State courts to adjudicate ss 75 and 76 matters had been excluded or "withdrawn" by operation of s 109 of the Constitution. Section 38 of the Judiciary Act provides that the jurisdiction of the High Court with respect to certain matters is exclusive of that of State courts, subject to certain exceptions which are not now relevant. Section 39(1) provides that the jurisdiction of the High Court, so far as it is not so by virtue of s 38, is exclusive of the jurisdiction of State courts, except as provided in s 39(2). Section 39(2) then, in effect, invests State courts with federal jurisdiction in all matters in which the High Court has original jurisdiction or in which original jurisdiction can be conferred on it (except as provided in s 38) subject to two conditions: first, that a decision of a State court shall not be subject to an appeal to Her 148 See Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 65-66 per Brennan CJ, 71-72 per Dawson J; McGinty v Western Australia (1996) 186 CLR 140 at 171-173 per Brennan CJ; Gould v Brown (1998) 193 CLR 346 at 373- 374 [5]-[6] per Brennan CJ and Toohey J; [1998] HCA 6; Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 607 [203] per Kirby J (in diss but not on point of principle); MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 [23] per Gleeson CJ, Gummow and Hayne JJ, 657-658 [180] per Heydon, Crennan and Kiefel JJ. 149 See for example Minister for Lands v Wilson [1901] AC 315 at 323. See also Ex parte Goldring (1903) 3 SR (NSW) 260 at 262-263 per Stephen ACJ, 263-264 per Owen J, 264 per Walker J; MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619-621 [24]-[30] per Gleeson CJ, Gummow and Hayne JJ. Nettle Majesty in Council, and second, that the High Court may grant special leave to appeal to it from any decision of any State court or judge. In Felton v Mulligan150, Walsh J held that, by the enactment of s 39(2) of the Judiciary Act, the Parliament effected the exclusion or withdrawal of the State jurisdiction of State courts to adjudicate ss 75 and 76 matters as a result of the operation of s 109 of the Constitution. His Honour so concluded151 on the basis that, by prescribing the conditions on which State courts are authorised to exercise federal jurisdiction in relation to matters falling within s 75 or s 76 of the Constitution, the Parliament manifested an intention that the only jurisdiction which State courts may exercise in relation to matters falling within s 75 or s 76 is federal jurisdiction subject to the specified conditions: "Doubts have been expressed by Professor Cowen and by Professor Sawer as to the availability of s 109 to meet the problem under discussion: see Cowen's Federal Jurisdiction in Australia, p 195; and Sawer, in Essays on the Australian Constitution, edited by Else-Mitchell, 2nd ed, p 86. Those writers have suggested that s 39 does not disclose an intention 'to cover the field', but, on the contrary, indicates that the intention was not to override, in all the matters to which s 39(2) refers, the jurisdiction which already belonged to the State courts. But in spite of difficulties created by the manner in which s 39 has been framed, my conclusion is that the laws under which the State courts would exercise their 'belonging' jurisdiction are made inoperative by s 39. If sub-s (2) thereof had simply invested the State courts with federal jurisdiction without adding the conditions and restrictions to which the investing was expressed to be subject, there would be perhaps no conflict with any laws under which the State courts already had jurisdiction. But when the conditions which have been attached to the grant of federal jurisdiction are considered, I think it should be held that Parliament intended that in the federal matters to which the section relates the only jurisdiction to be exercised by the State courts was to be federal jurisdiction, the exercise of which would be subject to the specified conditions." Similarly, in the preponderance of subsequent decisions of this Court regarding the operation of s 39 of the Judiciary Act, it has been held or accepted 150 (1971) 124 CLR 367 at 412 (Barwick CJ relevantly agreeing at 372); [1971] HCA 151 Felton v Mulligan (1971) 124 CLR 367 at 412-413 per Walsh J (Barwick CJ relevantly agreeing at 372). Nettle that the exclusion of the State jurisdiction of State courts in relation to ss 75 and 76 matters is the result of s 109 of the Constitution152. By contrast, in The Commonwealth v Queensland153, Jacobs J, on one view154, reasoned that, since the federal judicial power delineated in Ch III of the Constitution is exhaustive of the manner in and extent to which judicial power may be conferred on or exercised by State courts in relation to ss 75 and 76 matters, it is necessarily implicit in Ch III that the State jurisdiction of State courts in relation to those matters was withdrawn on Federation: "In my opinion the judicial power delineated in Ch III is exhaustive of the manner in and the extent to which judicial power may be conferred on or exercised by any court in respect of the subject matters set forth in ss 75 and 76, 'matters' in those sections meaning 'subject matters'. This is so not only in respect of federal courts but also in respect of State courts whether or not they are exercising federal jurisdiction conferred on them under s 77(iii). In respect of the subject matters set out in ss 75 and 76 judicial power may only be exercised within the limits of the kind of judicial power envisaged in Ch III and if in respect of those matters an investing with federal jurisdiction of a State court does not enable it to perform the particular judicial function, then in respect of those matters the State court cannot under any law exercise that judicial function. Therefore, if in respect of those matters a State court exercising federal jurisdiction cannot give 'advisory opinions' it cannot in respect of the same matters give such opinions in exercise of some State jurisdiction. Chapter III of the Constitution is so constructed that the limits of the Commonwealth power to invest State courts with federal jurisdiction with respect to the matters mentioned in ss 75 and 76 mark out the limits of the judicial power or function which in any case State courts can exercise in 152 See for example Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 471-472 per Gibbs J, 479 per Stephen, Mason, Aickin and Wilson JJ; [1980] HCA 32; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 571 [7] per Gleeson CJ, Gaudron and Gummow JJ; [2001] HCA 1; MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 [23]-[24] per Gleeson CJ, Gummow and Hayne JJ; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53] per French CJ, Kiefel, Bell, Gageler and Gordon JJ; [2015] HCA 36. See also Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142-1143 per Isaacs J. 153 (1975) 134 CLR 298 at 327-328 (McTiernan J substantially agreeing at 303); [1975] HCA 43. 154 See for example Commonwealth v Anti-Discrimination Tribunal (Tasmania) (2008) 169 FCR 85 at 137-138 [221]-[222] per Kenny J. Nettle respect of those matters. A State thus could not empower one of its courts to give advisory opinions on those subject matters. The court would be exercising judicial power but not a judicial power envisaged by Ch III and able to be conferred on it by the Commonwealth. It is then no answer to say that the State is conferring a judicial power which the Commonwealth is unable to confer. There is here no residuary State power, because Ch III is an exhaustive enunciation." (emphasis added) But, as the Court of Appeal observed155 in this case, one difficulty with Jacobs J's thesis is that, until the enactment of s 39(2) of the Judiciary Act, State courts and non-court State tribunals continued to adjudicate ss 75 and 76 matters in the exercise of State jurisdiction. If it were implicit in the text and structure of Ch III of the Constitution that, without more, the State jurisdiction of State courts in relation to those matters was withdrawn on Federation, it would follow that the State courts which dealt with ss 75 and 76 matters between Federation and the enactment of s 39(2) did so without jurisdiction. Perhaps, if that were the only obstacle in the way of the thesis, it might not be viewed as insurmountable. It might be conjectured, for example, that the actions of State courts and non-court State tribunals in continuing to adjudicate ss 75 and 76 matters in the exercise of State jurisdiction until the enactment of s 39(2) of the Judiciary Act could be explained, consistently with Jacobs J's thesis, on the basis that, at that early stage of the law's development, the full ramifications of the text and structure of Ch III of the Constitution remained to be perceived156. It is also not without significance that, in Felton v Mulligan, Walsh J in effect refrained from expressing a concluded view as to whether the exclusion of the State jurisdiction of State courts in relation to ss 75 and 76 matters was implicit in the text and structure of the Constitution. His Honour went no further than to observe that, if the Parliament had simply invested State courts with federal jurisdiction, without adding conditions and restrictions to which the investiture was expressed to be subject, "there would be perhaps no 155 Burns v Corbett (2017) 343 ALR 690 at 711 [88] per Leeming JA (Bathurst CJ and Beazley P agreeing at 693 [1], [2]). 156 See generally New South Wales v The Commonwealth (1915) 20 CLR 54; [1915] HCA 17; Waterside Workers' Federation of Australia v J W Alexander Ltd (1918) 25 CLR 434; [1918] HCA 56; R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254. See also Victoria v The Commonwealth (1971) 122 CLR 353 at 396 per Windeyer J; [1971] HCA 16; Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 553-554 [46]-[47] per McHugh J. Nettle conflict with any laws under which the State courts already had jurisdiction" (emphasis added)157. But the greater and ultimately determinative problem with accepting Jacobs J's thesis is that the text of s 77(ii) of the Constitution expressly left it to the Parliament to determine whether and to what extent the federal jurisdiction of federal courts should be exclusive of the jurisdiction which "belongs to or is invested in" State courts. Given the terms of s 77(ii), it cannot be that the Constitution of itself, without the enactment of legislation pursuant to s 77, impliedly excluded the State jurisdiction of State courts. That cannot be so because the supposed implication would be contrary to the express terms of s 77(ii). Rather, as Walsh J held in effect in Felton v Mulligan, it is because s 39(2) of the Judiciary Act invested federal jurisdiction in State courts to adjudicate ss 75 and 76 matters subject to conditions and restrictions which ensured that there would be a right of appeal to the High Court that the State jurisdiction of State courts to adjudicate such matters was impliedly excluded. A fortiori, it cannot be that the text of s 77(ii) of the Constitution, without the enactment of legislation pursuant to s 77, impliedly excluded the State jurisdiction of non-court State tribunals to adjudicate ss 75 and 76 matters, or that the Constitution of itself, without the enactment of legislation pursuant to s 77, had the effect from the moment of Federation that the only judicial power that could lawfully be exercised in relation to ss 75 and 76 matters was federal judicial power. So, therefore, to the questions which are decisive of these appeals: whether the Constitution armed the Parliament with legislative power to enact laws excluding the State jurisdiction of non-court State tribunals to adjudicate ss 75 and 76 matters; and, if so, whether by the enactment of s 39(2) of the Judiciary Act the Parliament has done so. It is not difficult to see that the Parliament's legislative power under s 77 of the Constitution to invest State courts with federal jurisdiction in relation to ss 75 and 76 matters includes the implied power to prevent State courts from continuing to adjudicate such matters in the exercise of State jurisdiction. To permit State courts to continue to adjudicate such matters in the exercise of State jurisdiction would negate the expedient of deploying State courts to determine ss 75 and 76 matters in the exercise of federal jurisdiction to the exclusion of State jurisdiction. At first sight it might appear more doubtful that the power to invest State courts with federal jurisdiction to determine ss 75 and 76 matters impliedly carries with it power to exclude the State jurisdiction of non-court State tribunals to adjudicate such matters. 157 (1971) 124 CLR 367 at 413 (Barwick CJ relevantly agreeing at 372). Nettle As authority makes plain, however, it is implicit in the text and structure of Ch III of the Constitution that States cannot undermine the exclusive legislative power of the Commonwealth to invest and regulate the exercise of federal jurisdiction for which Ch III provides158. And unquestionably it would substantially undermine the exclusive legislative power of the Commonwealth to invest and regulate the exercise of federal jurisdiction if, despite the Parliament having power to invest State courts with federal jurisdiction on conditions and subject to restrictions which exclude State courts from adjudicating such matters in the exercise of State jurisdiction, the Parliament were powerless to prevent non-court State tribunals from adjudicating such matters in the exercise of State jurisdiction. In effect, it would mean that States would be free to conduct a system of non-court State tribunals vested with State jurisdiction – conceivably even to invest officers of the State executive with State jurisdiction – to do what the Parliament had determined in the exercise of its exclusive legislative power should be done within an integrated system of federal and State courts in the exercise of federal jurisdiction to the exclusion of State jurisdiction. It would render the Commonwealth's exclusive legislative power to invest and regulate federal jurisdiction devoid of relevant content. The existence of that possibility points ineluctably to the need for, and the existence of, an implied legislative power for the Parliament to prevent it occurring. It dictates that just as the implied incidental power to exclude the State jurisdiction of State courts to adjudicate ss 75 and 76 matters is appropriate to effectuate the main purpose of Parliament's legislative power to invest State courts with federal jurisdiction to adjudicate ss 75 and 76 matters, so, too, is the implied incidental power to exclude the State jurisdiction of non-court State tribunals to adjudicate such matters. The question then is whether by s 39(2) of the Judiciary Act the Parliament exercised its implied incidental power to exclude the State jurisdiction of non-court State tribunals. As was submitted by the Solicitor- General for New South Wales, there is no ex facie, direct inconsistency between State courts exercising federal jurisdiction with respect to ss 75 and 76 matters on one set of conditions and non-court State tribunals exercising State jurisdiction with respect to those same matters on another, different set of conditions. In his 158 See Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 102-104 per Gaudron J, 115-116 per McHugh J; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 405-406 [227]-[230] per Gummow J; Wainohu v New South Wales (2011) 243 CLR 181 at 209-210 [45]-[47] per French CJ and Kiefel J, 228-229 [105] per Gummow, Hayne, Crennan and Bell JJ; [2011] HCA 24; Alqudsi v The Queen (2016) 258 CLR 203 at 266 [171] per Nettle and Gordon JJ; Rizeq v Western Australia (2017) 91 ALJR 707 at 719-720 [58]-[62] per Bell, Gageler, Keane, Nettle and Gordon JJ; 344 ALR 421 at 434-435. Nettle contention, it is also impossible to discern an intention in s 39(2) to "cover the field" in relation to the exercise of adjudicative power with respect to ss 75 and 76 matters or, as it was referred to by the Court of Appeal, to discern an "implied negative stipulation" to exclude the State jurisdiction of non-court State tribunals to adjudicate ss 75 and 76 matters. The Court of Appeal's answer was that, whether or not s 39(2) of the Judiciary Act contains an "implied negative stipulation" to that effect, the adjudication of ss 75 and 76 matters by non-court State tribunals not subject to an appeal to the High Court would so alter, impair or detract from the conditional and universal operation of the federal law as to engage the operation of s 109 of the Constitution159. But the difficulty with that, in the Solicitor-General's submission, is that it rather assumes the answer to the question. There is some force in that submission. If a State law is not directly inconsistent with a federal law, the State law cannot logically alter, impair or detract from the federal law unless the federal law expressly or by implication extends to or covers the purported area of operation of the State law160. And since State laws which purport to confer State jurisdiction on non-court State tribunals to adjudicate ss 75 and 76 matters are not directly inconsistent with s 39(2) of the Judiciary Act, it cannot be that they alter, impair or detract from the operation of s 39(2) unless s 39(2) impliedly extends to or covers the purported area of operation constituted of the adjudication of ss 75 and 76 matters by non- court State tribunals. Further, if s 39(2) does impliedly extend to or cover the area of the adjudication of ss 75 and 76 matters by non-court State tribunals, it can only be because, in one way or another, s 39(2) conveys an intention that non-court State tribunals should not enter into the area of adjudication of ss 75 and 76 matters. Ultimately, therefore, it is necessary to find that s 39(2) embodies an intention to exclude non-court State tribunals from the field of adjudication of ss 75 and 76 matters. 159 Burns v Corbett (2017) 343 ALR 690 at 709 [77] per Leeming JA (Bathurst CJ and Beazley P agreeing at 693 [1], [2]). 160 See Victoria v The Commonwealth (1937) 58 CLR 618 at 630 per Dixon J; [1937] HCA 82; Telstra Corporation Ltd v Worthing (1999) 197 CLR 61 at 76-77 [28]; [1999] HCA 12; Dickson v The Queen (2010) 241 CLR 491 at 502 [13]-[14]; [2010] HCA 30; Jemena Asset Management (3) Pty Ltd v Coinvest Ltd (2011) 244 CLR 508 at 524-525 [39]-[42]; [2011] HCA 33; Momcilovic v The Queen (2011) 245 CLR 1 at 110-111 [240]-[244] per Gummow J; [2011] HCA 34; The Commonwealth v Australian Capital Territory (2013) 250 CLR 441 at 467-468 [56]-[59]; [2013] HCA 55. Nettle In the result, however, the Court of Appeal were correct, because it is apparent that s 39(2) of the Judiciary Act does evince an intention to cover the field in relation to the adjudication of ss 75 and 76 matters and so thereby does convey an implied negative stipulation that non-court State tribunals should not enter into the area of the adjudication of ss 75 and 76 matters. Given that the object of the Parliament in conferring federal jurisdiction on State courts on conditions and subject to restrictions which impliedly exclude the State jurisdiction of State courts in relation to ss 75 and 76 matters would substantially be undermined if non-court State tribunals remained free to adjudicate such matters in the exercise of State jurisdiction, and given, as was held in Felton v Mulligan, that s 39(2) confers federal jurisdiction on State courts on conditions and subject to restrictions which impliedly exclude the State jurisdiction of State courts in relation to such matters, s 39(2) is naturally and ordinarily to be construed (in the absence of impelling contrary indication) as giving effect to that intended object of operation161. As so construed, it is apparent that, by conferring federal jurisdiction on State courts to adjudicate ss 75 and 76 matters on conditions and subject to restrictions which impliedly exclude the State jurisdiction of State courts to adjudicate such matters, s 39(2) provides for an integrated system of federal and State courts for the adjudication of ss 75 and 76 matters in the exercise of federal jurisdiction to the exclusion of State jurisdiction which is so much inconsistent with non-court State tribunals continuing to adjudicate ss 75 and 76 matters in the exercise of State jurisdiction as, by the operation of s 109, to exclude their jurisdiction to do so. For these reasons, I would hold that, the Parliament having provided by s 39(2) of the Judiciary Act that ss 75 and 76 matters shall be adjudicated by State courts in the exercise of federal jurisdiction on the conditions and subject to the restrictions there set out, the adjudication of ss 75 and 76 matters by a non- court State tribunal in the exercise of State jurisdiction is, by the operation of s 109 of the Constitution, prohibited. Accordingly, I would dismiss the appeals. 161 Ut res magis valeat quam pereat: Nokes v Doncaster Amalgamated Collieries Ltd [1940] AC 1014 at 1022 per Viscount Simon LC. 147 GORDON J. These appeals arise out of separate proceedings in the Civil and Administrative Tribunal of New South Wales ("NCAT") involving complaints under the Anti-Discrimination Act 1977 (NSW) ("the AD Act") by a resident of New South Wales, Mr Garry Burns, against two residents of other States, Mr Bernard Gaynor and Ms Therese Corbett. The appeals raise an important issue about the powers of the Commonwealth Parliament and State Parliaments to invest courts and tribunals with jurisdiction in matters within the scope of ss 75 and 76 of the Constitution. The issue, as framed in the Court of Appeal of the Supreme Court of New South Wales and in this Court, is whether a State Parliament can validly vest in an administrative tribunal, not being a court of a State, jurisdiction in a matter between residents of different States within the meaning of s 75(iv) of the Constitution. The answer is that a State Parliament cannot vest that jurisdiction. Upon Federation, the authority to adjudicate on matters between residents of different States – often described as diversity jurisdiction – was jurisdiction which State Parliaments could validly vest in the courts of the States. The Constitution did not then, and does not now, deny to a State Parliament the power to confer upon a body other than a State court the authority to adjudicate on matters between residents of different States. That a State Parliament now cannot vest that jurisdiction in a body other than a State court does not depend upon any implied constitutional limitation on State legislative power. Rather, it depends upon the operation of s 39 of the Judiciary Act 1903 (Cth) in conjunction with s 109 of the Constitution. In 1903, the Commonwealth exercised its powers under s 77(ii) and (iii) of the Constitution by enacting ss 38 and 39 of the Judiciary Act. With the enactment of the Judiciary Act, the jurisdiction of State courts in matters between residents of different States was withdrawn by s 39(1) of the Judiciary Act and conditionally reinvested by s 39(2) of the Judiciary Act. From that point, the source of State courts' authority to adjudicate on those matters, and the other matters in ss 75 and 76 of the Constitution162, was federal – and could only be federal163. As these reasons will explain, the consequence of the operation of s 39 of the Judiciary Act is not only that any authority of State courts to adjudicate on matters between residents of different States may only derive from a federal source, but also to render invalid, by operation of s 109 of the Constitution, any State law which purports to confer such authority on a body other than a State court. Such a State law undermines the intended operation of 162 Except the jurisdiction that, by reason of s 38 of the Judiciary Act, was not reinvested. 163 Felton v Mulligan (1971) 124 CLR 367 at 412-413; [1971] HCA 39. s 39 of the Judiciary Act insofar as s 39 is designed to ensure that the exclusive source of the authority to adjudicate on those matters is federal. To the extent that the Parliament of New South Wales purported to invest NCAT with the authority to adjudicate on a dispute under the AD Act between residents of different States, that investment of jurisdiction was invalid by reason of inconsistency with s 39 of the Judiciary Act. Accordingly, NCAT did not have jurisdiction to resolve the complaints against Ms Corbett and Mr Gaynor. The appeals should be dismissed. The proceedings In 2013 and 2014, Mr Burns lodged separate complaints with the Anti-Discrimination Board of New South Wales alleging that Ms Corbett and Mr Gaynor had each contravened s 49ZT of the AD Act. Section 49ZT(1) provides that it is unlawful "for a person, by a public act, to incite hatred towards, serious contempt for, or severe ridicule of, a person or group of persons on the ground of the homosexuality of the person or members of the group". At all material times, Mr Burns was a resident of New South Wales, Ms Corbett was a resident of Victoria and Mr Gaynor was a resident of Queensland. The complaint against Ms Corbett was referred to the Administrative Decisions Tribunal of New South Wales ("the ADT"), the predecessor to NCAT164, as the complaint could not be resolved by conciliation. The ADT found that Ms Corbett had contravened s 49ZT of the AD Act and ordered her to make both a public and a private apology. Ms Corbett appealed to the Appeal Panel of NCAT, which dismissed her appeal. The orders requiring Ms Corbett to make the apologies were then entered in the Supreme Court pursuant to s 114 of the AD Act. Mr Burns subsequently brought proceedings in the Supreme Court charging Ms Corbett with contempt for failing to comply with those orders. In those proceedings, Ms Corbett contended by way of defence that NCAT (and its predecessor) had no jurisdiction in relation to the complaint brought by Mr Burns because, among other things, she was a resident of Victoria. The contempt proceedings were then removed to the Court of Appeal for determination of separate questions addressing the jurisdiction of NCAT (and its predecessor) to determine a matter between residents of different States. It was common ground before the Court of Appeal that NCAT is not a "court of the State"165 and that the proceedings in NCAT under the AD Act involved the exercise of judicial power by NCAT. 164 NCAT was established, and the ADT abolished, with effect from 1 January 2014: see s 7 of the Civil and Administrative Tribunal Act 2013 (NSW). 165 Burns v Corbett (2017) 343 ALR 690 at 698 [29]. The remaining matters in this Court relate to complaints against Mr Gaynor. Three complaints made by Mr Burns against Mr Gaynor were referred to NCAT. Mr Burns later lodged further complaints against Mr Gaynor. The substance of the complaints and the procedural history can be put to one side. It is sufficient for present purposes to observe that the proceedings in relation to the first three complaints were dismissed on the basis that there had been no "public act" in New South Wales so as to engage the prohibition in s 49ZT of the AD Act; and, further, that a costs order was made against Mr Gaynor at an interlocutory stage. Mr Gaynor was granted leave to appeal to the Court of Appeal against that costs order and by summons sought a declaration to the effect that NCAT lacked jurisdiction to adjudicate on complaints relating to citizens resident in a State other than New South Wales. The Court of Appeal heard and determined the jurisdictional question in each proceeding. The Attorney-General of the Commonwealth and the Attorney General for New South Wales intervened. The Court of Appeal held that NCAT had no jurisdiction to hear and determine the complaints against Ms Corbett and Mr Gaynor. In this Court, the Commonwealth's primary submission, advanced by notice of contention, was that there is an implied constitutional constraint on State legislative power, such that any State law is invalid to the extent that it purports to confer judicial power in respect of any of the matters identified in ss 75 and 76 of the Constitution on a person or body that is not one of the "courts of the States". The Commonwealth's alternative submission, which had been accepted by Leeming JA in the Court of Appeal166, was that such a law is inconsistent with s 39(2) of the Judiciary Act and thus invalid by operation of s 109 of the Constitution. The Attorney General for New South Wales, supported by the intervening State Attorneys-General, submitted that the Court of Appeal was correct to reject the Commonwealth's primary submission but wrong to accept the Commonwealth's alternative submission that NCAT is unable to exercise judicial power to determine matters between residents of different States by reason of s 109 of the Constitution. Jurisdiction – nature and source The question whether a State Parliament can validly vest in an administrative tribunal, not being a court of a State, jurisdiction in a matter between residents of different States within the meaning of s 75(iv) of the Constitution necessarily directs attention to the nature and source of the jurisdiction in issue. 166 Burns (2017) 343 ALR 690 at 713 [95]-[97]. "Jurisdiction", in relation to a subject matter, refers to the authority to adjudicate upon a class of questions concerning that subject matter167. The distinction drawn between federal jurisdiction and State jurisdiction concerns the available sources of such authority. "State jurisdiction is the authority which State Courts possess to adjudicate under the State Constitution and laws; federal jurisdiction is the authority to adjudicate derived from the Commonwealth Constitution and laws"168. Section 75 of the Constitution defines five classes of matters in which the High Court shall have original jurisdiction. Under s 76 of the Constitution, the Commonwealth Parliament may make laws conferring original jurisdiction on the High Court in a further four classes of matters. Federal jurisdiction is authority to adjudicate on those nine classes of matters which is vested by the Constitution or by Commonwealth laws enacted under it169. With respect to any of the matters mentioned in ss 75 and 76 of the Constitution, the Commonwealth Parliament may, under s 77, make laws: defining the jurisdiction of any federal court other than the High Court; defining the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to or is invested in the courts of the States; (iii) investing any court of a State with federal jurisdiction." Section 77(ii) draws a distinction between jurisdiction that "belongs to" the courts of the States and jurisdiction that "is invested in" those courts. That distinction reflects the demarcation of State jurisdiction from federal jurisdiction: "[t]hat which 'belongs to' the State courts within the meaning of s 77(ii) is the 167 CGU Insurance Ltd v Blakeley (2016) 259 CLR 339 at 349 [24]; [2016] HCA 2. See also Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142; [1907] HCA 76. 168 Baxter (1907) 4 CLR 1087 at 1142. See also Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 571 [7]; [2001] HCA 1; CGU (2016) 259 CLR 339 at 349 [24]; Rizeq v Western Australia (2017) 91 ALJR 707 at 713 [8], 718 [49]; 344 ALR 421 at 424, 431-432; [2017] HCA 23. 169 Rizeq (2017) 91 ALJR 707 at 718 [51]; 344 ALR 421 at 432. authority they possess to adjudicate under the constitutions and laws of the States"170. Section 77(ii) and (iii) confer power on the Commonwealth Parliament to withdraw and invest jurisdiction in the courts of the States in respect of matters within ss 75 and 76 of the Constitution. Those sub-sections thereby enable the Commonwealth to secure "federal control" over the matters in ss 75 and 76 of the Constitution; and, relevantly, over the areas where there would otherwise be concurrent State and federal jurisdiction171. Relevantly, the powers in s 77(ii) and (iii) were not exercised until the enactment of ss 38 and 39 of the Judiciary Act in 1903. The manner in which the powers were exercised – which has remained substantially the same since 1903 – is important. Sections 38 and 39(1) of the Judiciary Act make the jurisdiction of the High Court exclusive of the jurisdiction of the several courts of the States. Section 38 makes the jurisdiction of the High Court exclusive of State jurisdiction in several matters which fall within, but are not exhaustive of, the matters identified in s 75 of the Constitution172. Section 39(1) makes the jurisdiction of the High Court exclusive of State jurisdiction in those matters not mentioned in s 38. However, s 39(2) goes on to provide that State courts shall, "within the limits of their several jurisdictions", have jurisdiction in the matters covered by s 39(1) subject to the conditions identified in s 39(2)(a) and (c). Those conditions also apply to any other Commonwealth law that invests jurisdiction in a State court173. The direct consequence of making the jurisdiction of the High Court in matters within ss 75 and 76 of the Constitution exclusive174 and then conditionally reinvesting such jurisdiction in State courts175 was that, to the extent that State courts had State jurisdiction in those matters, the source of the 170 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 [23]; [2008] HCA 28 citing Baxter (1907) 4 CLR 1087 at 1142. 171 See Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 802. 172 The matters in s 38(a) correspond to the matters in s 75(i) of the Constitution. The matters in s 38(b) to (e) correspond in part to matters set out in s 75(iii), (iv) and (v) of the Constitution. 173 s 39A(1) of the Judiciary Act. 174 ss 38 and 39(1) of the Judiciary Act. 175 s 39(2) of the Judiciary Act. authority to decide those matters became federal176. The fact that federal jurisdiction in the matters covered by s 39(2) was conditionally reinvested had another consequence: namely, the only jurisdiction that State courts could exercise in those matters was federal jurisdiction177. Just which matters within ss 75 and 76 of the Constitution "belong[ed] to" the courts of the States prior to the enactment of the Judiciary Act is not conclusively decided by the authorities. In Baxter v Commissioners of Taxation (NSW), Griffith CJ, Barton and O'Connor JJ said that the determination of matters in ss 75 and 76 of the Constitution "was within the jurisdiction of the State Courts, who were bound to administer the laws of the State which include the Constitution and all laws passed by the Federal Parliament" under covering cl 5 of the Constitution178 (emphasis added). Their Honours drew no further distinction between matters in ss 75 and 76 which belonged to the State courts and those that did not. On the other hand, Andrew Inglis Clark observed in 1901 – in an analysis quoted with approval by Gleeson CJ, Gummow and Hayne JJ in MZXOT v Minister for Immigration and Citizenship – that the judicial power of the Commonwealth in respect of some of the matters in s 75 (if not s 76) appeared to be "necessarily exclusive of the judicial power of the States"179. Matters in which the Commonwealth was a defendant, or in which a writ of mandamus or prohibition or an injunction was sought against an officer of the Commonwealth, were unknown and unknowable to "the anterior body of general jurisprudence in the colonies"180. Griffith CJ, Barton and O'Connor JJ stated unequivocally in Hannah v Dalgarno that "the Supreme Court of New South Wales had no jurisdiction to entertain an action against the Commonwealth" but for the 176 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53]; [2015] HCA 36. 177 Felton (1971) 124 CLR 367 at 412-413; Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 479; [1980] HCA 32; PT Bayan (2015) 258 CLR 1 at 21 [53]; Rizeq (2017) 91 ALJR 707 at 721 [67]; 344 ALR 421 at 436. 178 (1907) 4 CLR 1087 at 1136. That accords with the opinion of Alfred Deakin, writing as Attorney-General of the Commonwealth in 1901 (before the enactment of the Judiciary Act): see Deakin, "Federal Jurisdiction of State Courts", in Brazil and Mitchell (eds), Opinions of Attorneys-General of the Commonwealth of Australia, Volume 1: 1901-14, (1981) at 30. 179 Inglis Clark, Studies in Australian Constitutional Law, (1901) at 177-178 quoted in MZXOT (2008) 233 CLR 601 at 619-620 [26]. 180 See MZXOT (2008) 233 CLR 601 at 619 [25]. investment of Commonwealth Act 1902 (Cth)181. jurisdiction effected by s 6 of the Claims against the The view that State jurisdiction did not extend to all matters within ss 75 and 76 necessarily suggests that there was a jurisdictional void in certain classes of matters – in the sense that no court had authority to adjudicate on them – until the establishment of the High Court and other federal courts. That outcome may seem curious. However, the basis for the contrary position – that State courts could exercise State jurisdiction in all matters within ss 75 and 76 upon the commencement of the Constitution – is not self-evident, even accounting for the possibility that, by reason of covering cl 5 of the Constitution, State jurisdiction was not strictly limited to matters known in the colonies. It is not, in any event, necessary to determine precisely which matters in ss 75 and 76 of the Constitution formed part of the jurisdiction that "belong[ed] to" State courts at and immediately after Federation. But two points are presently relevant. First, s 77(ii) assumes and recognises that there was State jurisdiction in at least some of the matters in ss 75 and 76 of the Constitution. For s 77(ii) to have any operation, there must have been some State jurisdiction capable of being excluded. Second, matters between residents of different States, within the meaning of s 75(iv) of the Constitution, were among the classes of matters in which State courts could exercise State jurisdiction before the enactment of the Matters between residents of different Australian colonies were known to colonial courts183, notwithstanding difficulties with service of process and execution of judgments184. There is no logical or principled impediment to that jurisdiction persisting after Federation185. Indeed, State courts routinely determined matters between residents of different States up to 1903, though 181 Hannah v Dalgarno (1903) 1 CLR 1 at 8; [1903] HCA 1. See s 75(iii) of the Constitution. The judgment under appeal in Hannah was given before the enactment of the Judiciary Act. 182 MZXOT (2008) 233 CLR 601 at 619 [25]. 183 See, eg, Ricketson v Dean and Laughton (1870) 4 SALR 78; Splatt v Splatt (1885) 11 VLR 300; Granowski v Shaw (1896) 7 QLJ 18. 184 See, eg, Banks v Orrell (1878) 4 VLR (L) 219. See also Ammann v Wegener (1972) 129 CLR 415 at 443; [1972] HCA 58. 185 See Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 36-37 [55]-[58]; [2002] HCA 27. issues with service and execution and security of costs continued to arise186. It was consistently assumed, and never doubted, that State courts could exercise State jurisdiction in matters between residents of different States187. They were among the matters which were subject to the operation of s 39(1) and (2) of the Judiciary Act. Ms Corbett and Mr Gaynor's contrary submission – which appeared to rely on the proposition that "[t]he States did not exist either politically or constitutionally" and that any prior jurisdiction in matters between residents of different colonies therefore did not survive Federation – is untenable in light of ss 106, 107 and 108 of the Constitution and the simple fact that "[t]he States" are defined in covering cl 6 to include (among other entities) the colonies that existed at the time of Federation. The consequence is that any authority of a State court to adjudicate on a matter between residents of different States can derive only from a federal source. Where a State court adjudicates on a matter between residents of different States, "the State court is invested with federal jurisdiction with respect to the matter under s 39(2) to the exclusion of State jurisdiction under s 109 of the Constitution"188 (emphasis added). On the other hand, neither ss 38 and 39 of the Judiciary Act nor s 77 of the Constitution expressly deals with tribunals that are not courts of the States. The question that therefore arises is whether a State Parliament can validly authorise a tribunal, not being a court of a State, to exercise judicial power and therefore jurisdiction in a matter between residents of different States within s 75(iv) of the Constitution. Section 109 or constitutional implication? Where it is contended that a law of a State and a law of the Commonwealth conflict with one another, s 109 of the Constitution requires a comparison between the two laws and "resolves conflict, if any exists, in favour of the Commonwealth"189 (emphasis added). More particularly, s 109 is 186 See, eg, Wain v Greschke (1902) 19 WN (NSW) 144; Ramsay v Eager (1902) 27 VLR 603; Evans v Sneddon (1902) 28 VLR 396; Ex parte Hore (1903) 3 SR (NSW) 462; Conrad v Muston (1903) 20 WN (NSW) 28. 187 See Evans (1902) 28 VLR 396 at 400. 188 Rizeq (2017) 91 ALJR 707 at 721 [67]; 344 ALR 421 at 436. 189 Jemena Asset Management (3) Pty Ltd v Coinvest Ltd (2011) 244 CLR 508 at 523 [37]; [2011] HCA 33. concerned with the identification of conflict between laws that are otherwise valid. As explained in D'Emden v Pedder, "[w]hen a law of a State otherwise within its competency is inconsistent with a law of the Commonwealth on the same subject, such subject being also within the legislative competency of the Commonwealth, the latter shall prevail"190. Where one or both of the laws are otherwise invalid, no conflict can exist and no occasion arises to consider the operation of s 109. Each of the Commonwealth's submissions sought to demonstrate that the purported conferral of jurisdiction by the AD Act to address the complaints by Mr Burns was not permitted under the Constitution. Resolution of these appeals must begin with the Commonwealth's primary submission, by which it contended that there is an implied constitutional limitation which denies to a State Parliament the power to invest a person or body other than a State court with jurisdiction in matters within ss 75 and 76. If such a limitation were found to exist, the AD Act would not validly confer jurisdiction on NCAT to adjudicate on matters between residents of different States. It follows that there could be no relevant conflict with s 39 of the Judiciary Act, and any consideration of the invalidating operation of s 109 of the Constitution (the subject of the Commonwealth's alternative submission) would be hypothetical. Constitutional implication? It is not disputed that where an implication is sought to be derived from the structure of the Constitution, it is necessary to show that the implication is "logically or practically necessary" for the preservation of the constitutional structure191. The requirement that the implication be logically or practically necessary reflects the need for any implication to be "securely based" in the text and structure of the Constitution192. In oral argument, the Commonwealth submitted that the implied limitation for which it contended was not a "new" implication, but rather a "consequence" of implications from Ch III of the Constitution recognised in earlier cases193. The Commonwealth contended that 190 (1904) 1 CLR 91 at 111; [1904] HCA 1. See also Rizeq (2017) 91 ALJR 707 at 718 [47]; 344 ALR 421 at 431. 191 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 135; [1992] HCA 45; McGinty v Western Australia (1996) 186 CLR 140 at 169; [1996] HCA 48. 192 See ACTV (1992) 177 CLR 106 at 134-135; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 453 [389]; [2005] HCA 44; McCloy v New South Wales (2015) 257 CLR 178 at 283 [318]; [2015] HCA 34. 193 See, eg, R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254; [1956] HCA 10. the matters in ss 75 and 76 had been identified as matters of "particular or special federal concern", and that Ch III of the Constitution made a "deliberate selection" of federal and State courts as the only bodies which could exercise judicial power in relation to those matters. In support of that contention, the Commonwealth relied on the notion that Ch III establishes an "integrated Australian judicial system for the exercise of the judicial power of the Commonwealth"194, and submitted that such a system would be fragmented if entities other than State courts could exercise State judicial power in respect of the matters referred to in ss 75 and 76, insusceptible to the possibility of federal control. In the Commonwealth's submission, that structural argument produced a specific result in s 77(ii). In particular, s 77(ii) was said to be based on an assumption "that, if jurisdiction is to be exercised by any State body in respect of ss 75 or 76 matters, that body must be a State court". Put another way, s 77(ii) recognised that, at the State level, courts, and only courts, could exercise jurisdiction (whether State or federal) in relation to matters within the scope of ss 75 and 76. This "negative" implication was said to arise because, were it otherwise, a State Parliament could circumvent an exercise of the power conferred by s 77(ii) by simply vesting in a non-judicial tribunal the jurisdiction that was withdrawn from State courts. The Commonwealth's primary submission should be rejected. To invoke the observation that Ch III of the Constitution establishes an integrated Australian judicial system for the exercise of the judicial power of the Commonwealth is not helpful in this context. It disregards the fact that (as was common ground between all parties and interveners except for Ms Corbett and Mr Gaynor) it has not been established, and it is not correct, that the Constitution posits that the matters within ss 75 and 76 should only be dealt with in the exercise of the judicial power of the Commonwealth. As s 77(ii) and (iii) make plain, it is the Commonwealth Parliament which may make laws defining the extent to which jurisdiction of any federal court shall be exclusive of that which belongs to, or is invested in, the courts of the States. Nor is it determinative to characterise the matters in ss 75 and 76 as topics of "special" federal concern and to posit that the Constitution established a closed scheme in which courts alone could adjudicate on such matters. To say that there was such a "deliberate selection" is a statement of conclusion, not of reasoning. The earlier discussion of the constitutional and statutory framework demonstrates that s 77 of the Constitution contemplates the possibility of "federal control" over the authority to adjudicate on matters within ss 75 and 76. But as 194 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 102; [1996] HCA 24. is, only jurisdiction (that Leeming JA recognised in the Court of Appeal195, nothing in s 77 requires that matters within ss 75 and 76 – to the extent that jurisdiction in those matters belonged to the courts of the States at Federation – should be dealt with only in federal the Commonwealth) or otherwise be subject to some kind of federal control. Observing that s 77(ii) and (iii) do not require that a law made under those provisions should say that the relevant matters may be dealt with only in federal jurisdiction emphasises the relevant breadth of the power and control conferred by those provisions. In particular, it emphasises that s 77(ii) and (iii) support a law saying, in effect, that one or more of the matters of the relevant kinds may be dealt with only in federal jurisdiction and, hence, by a court having certain characteristics. judicial power of through the Section 77(ii) confers power on the Commonwealth Parliament to exclude State jurisdiction in relation to matters within ss 75 and 76. It is facultative. It follows that "federal control" over jurisdiction in relation to those matters is not pre-ordained by the Constitution, whether in s 77 or elsewhere. Such control depends on the Commonwealth Parliament exercising the powers conferred by s 77, as it did through ss 38 and 39 of the Judiciary Act. And as the Commonwealth's submissions in this Court recognised, there was more than one way in which the Commonwealth could have exercised (and did exercise) the powers in s 77 so as to develop and manage a system by which federal jurisdiction in matters within ss 75 and 76 would be exercised. The issue about exclusivity of federal jurisdiction was to be decided by the Commonwealth Parliament and the resolution of that issue was to be, and is, expressed in legislation that that Parliament enacted – the Judiciary Act. the constitutional Contrary implication, is not, predetermined by some constitutionally mandated structure or implication. The tension of a State law permitting a State tribunal to exercise relevant federal jurisdiction arises because of the enactment of the Judiciary Act by the Commonwealth Parliament. the Commonwealth's submissions about that issue was not, and The Commonwealth v Queensland ("the Queen of Queensland Case")196, in the context of a State law purporting to confer on the Judicial Committee of the Privy Council jurisdiction to provide advisory opinions in relation to laws in force in that State, is instructive. Gibbs J (with whom Barwick CJ, Stephen J and Mason J agreed) relevantly held that Ch III of the Constitution did not of its own force affect the jurisdiction of the Judicial Committee to entertain appeals from decisions of this Court (except upon any inter se question) or from decisions of 195 Burns (2017) 343 ALR 690 at 705-706 [58]-[64]. 196 (1975) 134 CLR 298; [1975] HCA 43. the courts of the States in matters arising in the exercise of federal jurisdiction. However, the provisions of Ch III enabled the Commonwealth Parliament by appropriate legislation to achieve the result that all of the matters mentioned in ss 75 and 76 of the Constitution (except possibly inter se questions) should be finally decided in this Court and not the Judicial Committee197. That is, the power conferred by s 77 enabled the Commonwealth Parliament to enact legislation having the effect that no appeal could be brought to the Judicial Committee from the decision of a State court given in the exercise of federal jurisdiction, and that Parliament had done so, by s 39(2) of the Judiciary Act198. Importantly, it was because the Parliament had exercised its power to prevent any appeal being brought to the Judicial Committee from a decision of this Court or a State court on any such matter that Gibbs J held that it was implicit in Ch III that it was not permissible for a State by legislation to provide a procedure by which the Judicial Committee was enabled to consider any matter arising in the exercise of federal jurisdiction199. The point of present importance is that the result rested on the Parliament having enacted s 39(2) of the Judiciary Act, not on any constitutional implication. The reference Gibbs J made to what may be "implicit in Ch III" was, as his reasons explained200, offered in support of the conclusions first expressed and which have been set out above, including, in particular, that Ch III did not of its own force affect the jurisdiction of the Judicial Committee but that Ch III gave to the Parliament the power to enact such a law. Further, the reasoning in the Boilermakers' Case201 did not and does not resolve the issue. The Boilermakers' Case did not establish a separation of powers for the States. The Boilermakers' Case did not deny the possibility that matters within ss 75 and 76 could be adjudicated on by a State tribunal. What the Boilermakers' Case did establish was that "Ch III … is an exhaustive statement of the manner in which the judicial power of the Commonwealth is or may be vested"202 (emphasis added). The question which arises here is whether, prior to 197 Queen of Queensland Case (1975) 134 CLR 298 at 314. 198 Queen of Queensland Case (1975) 134 CLR 298 at 313 citing McIlwraith McEacharn Ltd v Shell Co of Australia Ltd (1945) 70 CLR 175 at 209; [1945] HCA 11. 199 Queen of Queensland Case (1975) 134 CLR 298 at 314-315. 200 Queen of Queensland Case (1975) 134 CLR 298 at 314-315. 201 (1956) 94 CLR 254. 202 (1956) 94 CLR 254 at 270. 1903, jurisdiction like that of NCAT was removed by Ch III. The answer is no. It was agreed in these appeals that NCAT was not a court of the State. Even if NCAT were a State court, it would have retained its "belongs to" jurisdiction prior to the enactment of the Judiciary Act. Finally, there is nothing in the text of Ch III (or the Boilermakers' Case) to suggest that by reason of some "implication" the jurisdiction of a State tribunal was removed, just as there is nothing to suggest that by implication the jurisdiction of a State court was removed in relation to the matters within ss 75 and 76. In fact the language of s 77(ii) is expressly to the contrary. The existence of the High Court's constitutionally entrenched position identifies a question, it does not answer it. Once it is accepted that the existence of a scheme according to which jurisdiction in relation to matters in ss 75 and 76 would be exclusively federal depended, and continues to depend, on the exercise of the power conferred by s 77(ii) and (iii), the concern about circumvention or fragmentation of such a scheme by States choosing to vest jurisdiction in non-judicial tribunals loses much of its force as a consideration in favour of the Commonwealth's primary submission203. Any concern about States circumventing a national scheme in relation to matters within ss 75 and 76 can only arise at the point at which the powers in s 77 are actually exercised. Logically, that concern could only provide clear support for the Commonwealth's primary submission if there were no other way in which such circumvention could be prevented once the powers were exercised. As will be seen when considering the Commonwealth's alternative submission, that is not so. The point may be amplified in this way. The sole concern that animated the Commonwealth's primary submission was that States would be "subject to Commonwealth control" insofar as they purported to invest courts with jurisdiction in matters within ss 75 and 76 of the Constitution, but would be "free to confer [jurisdiction] to do exactly the same thing in relation to the same subject matters on a State tribunal outside of that scheme". So articulated, the concern was that federal control might be circumvented. However, that federal control only arose at the point at which the Commonwealth exercised its powers in s 77(ii) and (iii). Between 1901 and 1903, there was only the potential for federal control, which was made possible by the availability of the power under s 77(ii) and (iii). Until that power was exercised, there was nothing inherently problematic about State tribunals exercising jurisdiction in matters between residents of different States. Once the power under s 77(ii) and (iii) was exercised to create some degree of federal control in relation to classes of matters within ss 75 and 76 of the Constitution, it may be argued that it became incoherent, or at least problematic, for the States to continue to be free to 203 cf Commonwealth v Anti-Discrimination Tribunal (Tasmania) (2008) 169 FCR 85 at 137-138 [222]; Lindell, Cowen and Zines's Federal Jurisdiction in Australia, 4th ed (2016) at 313-314. confer such jurisdiction on tribunals. But any such incoherence did not exist until the enactment of the Judiciary Act. There is also no evident historical basis for the contention that the Constitution created a "closed scheme" in which courts alone could exercise jurisdiction in matters in ss 75 and 76 of the Constitution. Indeed, that contention arguably conflicts with the fact that bodies other than courts appear to have exercised judicial power prior to Federation without concern or objection. In this Court, reference was made to the Local Land Boards established by the Crown Lands Act 1884 (NSW) ("the 1884 Act")204. Although the Land Boards were not constituted as courts of record, some powers were conferred upon them by analogy to the Court of Petty Sessions205. They had no power to punish contempt; members had no security of tenure206; they had no obligation to determine disputes within their jurisdiction207; and, until the Crown Lands Act 1889 (NSW) ("the 1889 Act"), appeals lay to the Minister208. In these respects, the Land Boards were very different from the Land Court established by the 1889 Act, which was designated as a court of record209 and had power to punish contempt210. Whether and to what extent the Land Boards and other administrative tribunals exercised judicial power with respect to the particular matters within ss 75 and 76 of the Constitution was not explored in any detail by the parties or intervening Attorneys-General in this Court. But the existence of bodies which were not recognised to be courts but were empowered to resolve disputes by using curial powers at least casts doubt on the proposition that the Constitution, merely by omitting to mention non-court tribunals in connection with the matters within ss 75 and 76 of the Constitution, was erecting a scheme which excluded State tribunals from exercising jurisdiction in those matters. In relation to 204 See generally Wilson v Minister for Lands (1899) 20 LR (NSW) (L) 104. 205 s 14(i) and (ii) of the 1884 Act. 206 ss 11 and 14(viii) of the 1884 Act. 207 s 14(vii) of the 1884 Act. 208 ss 17 and 18 of the 1884 Act. 209 s 8 of the 1889 Act. 210 s 9 of the 1889 Act. diversity matters in particular, it may be added that "there was no fear of partiality or bias on the part of state tribunals" before Federation211. In summary, the Commonwealth's primary submission overstates the significance of how the provisions of Ch III of the Constitution identify, and deal with the authority to adjudicate on, matters in ss 75 and 76. Sections 75 and 76 recognise that there are certain matters which are (or may be) appropriate to be adjudicated on by the High Court in its original jurisdiction. Section 77 recognises that those matters should in turn be amenable to some measure of federal control and provides the Commonwealth Parliament with power to achieve that control. It is not possible to reason on that basis: (1) that the Constitution presupposes a particular scheme for how jurisdiction in ss 75 and 76 matters could be conferred and exercised; or (2) that Ch III exhaustively identifies the actors which could participate in that scheme. The former is not consistent with the actual operation of ss 75, 76 and 77 of the Constitution; and the latter remains no more than a statement of conclusion, without a clear principled or historical foundation. For those reasons, the Commonwealth's primary submission should be rejected. There was, and is, no basis for contending that, from Federation, tribunals other than State courts could not exercise judicial power with respect to any of the matters in ss 75 and 76 of the Constitution. The structural implication contended for by the Commonwealth is not logically or practically necessary for the preservation of the integrity of the constitutional structure envisaged by Inconsistency Section 109 of the Constitution provides that "[w]hen a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid". As noted earlier, where it is contended that a Commonwealth law and a State law are in conflict, "s 109 requires a comparison between any two laws which create rights, privileges or powers, and duties or obligations, and s 109 resolves conflict, if any exists, in favour of the Commonwealth"213. 211 Cowen, "Diversity Jurisdiction: The Australian Experience", (1955-1957) 7 Res Judicatae 1 at 3. 212 ACTV (1992) 177 CLR 106 at 135; McGinty (1996) 186 CLR 140 at 168; APLA (2005) 224 CLR 322 at 409 [240], 453 [389]. 213 Jemena (2011) 244 CLR 508 at 523 [37]; Bell Group NV (In liq) v Western Australia (2016) 90 ALJR 655 at 665 [50]; 331 ALR 408 at 422; [2016] HCA 21. A conflict may arise in different ways214. Relevantly, a State law that "would alter, impair or detract from the operation of a law of the Commonwealth Parliament" is to that extent invalid (emphasis added)215. The inquiry into whether a State law alters, impairs or detracts from the operation of a Commonwealth law seeks to identify ways in which the State law undermines the Commonwealth law. The inquiry thus requires identification of a "significant and not trivial" alteration or impairment of, or detraction from, the operation of the Commonwealth law216. The application of s 109 depends not only on the purported operation of the Commonwealth law and the State law, but also on the scope of the respective powers of the Commonwealth Parliament and the State Parliament217. As noted earlier, s 109 is concerned with conflict between otherwise valid laws. As has already been explained, in relation to those matters within ss 75 and 76 of the Constitution that are not dealt with by s 38 of the Judiciary Act, s 39(1) of the Judiciary Act makes the jurisdiction of the High Court exclusive of the jurisdiction of the State courts and s 39(2) conditionally reinvests those courts with federal jurisdiction. The upshot is that "the only jurisdiction to be exercised by the State courts was to be federal jurisdiction, the exercise of which would be subject to the specified conditions"218 (emphasis added). To that extent, s 39 evinces an intention to bring about federal control over the exercise by State courts of jurisdiction in relation to matters within ss 75 and 76219. The fact that neither s 39(1) nor s 39(2) of the Judiciary Act expressly refers to non-judicial tribunals does not mean that there is no inconsistency between s 39 and the conferral of State jurisdiction on such tribunals. 214 See Telstra Corporation Ltd v Worthing (1999) 197 CLR 61 at 76 [28]; [1999] HCA 12; Dickson v The Queen (2010) 241 CLR 491 at 502 [13]-[14]; [2010] HCA 30; Bell Group (2016) 90 ALJR 655 at 665-666 [51]; 331 ALR 408 at 422. 215 Worthing (1999) 197 CLR 61 at 76 [28] quoting Victoria v The Commonwealth (1937) 58 CLR 618 at 630; [1937] HCA 82. 216 Jemena (2011) 244 CLR 508 at 525 [41]. See also Bell Group (2016) 90 ALJR 655 at 665-666 [51]; 331 ALR 408 at 422. 217 Bayside City Council v Telstra Corporation Ltd (2004) 216 CLR 595 at 628-629 [37]; [2004] HCA 19. 218 Felton (1971) 124 CLR 367 at 413. 219 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, Section 109 relevantly directs attention to whether such a conferral of jurisdiction alters, impairs or detracts from the operation of s 39 of the Judiciary Act. And if a State Parliament were free to confer upon State tribunals jurisdiction in relation to the matters on which s 39 of the Judiciary Act operates, without that conferral of jurisdiction needing to be subject to the conditions identified in s 39(2) of the Judiciary Act (or any other incidents of federal jurisdiction), that would plainly detract from the intended operation of s 39. That is because, to the extent that a State Parliament can respond to the limitations imposed by s 39 by vesting jurisdiction in a State tribunal that is not a court of the State, the efficacy of s 39 insofar as it operates on State courts is correspondingly reduced. In this Court, the Attorneys-General for Queensland and Victoria (intervening) submitted that the Commonwealth Parliament did not have power to exclude or otherwise control the jurisdiction of State bodies other than courts in matters within ss 75 and 76, and that s 39 of the Judiciary Act could not operate with s 109 of the Constitution to invalidate a State law that conferred such jurisdiction on a State tribunal. Those submissions relied on the fact that neither s 77(ii) nor s 77(iii) of the Constitution expressly deals with the jurisdiction of State tribunals: in their terms, they empower the Commonwealth Parliament to withdraw jurisdiction from, and invest jurisdiction in, the courts of the States. And because the judicial power of the Commonwealth may be exercised only by a Ch III court220, the Commonwealth Parliament also lacks power to vest State tribunals with jurisdiction in matters within ss 75 and 76. That difficulty has been addressed earlier: s 77(ii) and (iii) support a law saying, in effect, that one or more of the matters of the relevant kinds may be dealt with only in federal jurisdiction and, hence, by a court having certain characteristics. That difficulty may also be resolved by reference to the incidental power in s 51(xxxix) of the Constitution, and to its interaction with the grants of legislative power in s 77(ii) and (iii). Section 51(xxxix) directs attention to whether a matter is "incidental to the execution of the principal power or is necessary or proper to render the main grant of power effective"221. There is no difficulty in accepting that the power to prevent State tribunals from exercising jurisdiction in matters within ss 75 and 76 is necessary or proper for the effective operation of a scheme which is intended to, and does, ensure that the jurisdiction of the courts of the States in relation to those matters is exclusively federal. The power is "reasonably necessary"222 to ensure that s 39 of 220 See Boilermakers' Case (1956) 94 CLR 254 at 270 and the authorities there cited. 221 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 580 [122]; [1999] HCA 27. 222 cf Re Wakim (1999) 198 CLR 511 at 580 [122]. the Judiciary Act, as an exercise of legislative power under s 77(ii) and (iii) of the Constitution, is not undermined by the choice of a State Parliament to vest like jurisdiction in a non-judicial tribunal, which would not be constrained by the conditions in s 39(2) or by any other incidents of federal jurisdiction. There may be other limitations on the scope of the incidental power223. No such limitations were pressed in oral argument. In its written submissions before the hearing, Victoria argued that s 51(xxxix) of the Constitution cannot be relied upon to grant a person "immunity" from State laws conferring rights and liabilities. But to the extent that s 39 of the Judiciary Act has the effect of preventing the conferral of jurisdiction on a State non-judicial tribunal, it confers no "immunity" on parties to a controversy. It excludes the authority of the tribunal to adjudicate on the dispute. For those reasons, to the extent that the Parliament of New South Wales purported to confer on NCAT authority to adjudicate on a dispute under the AD Act between residents of different States, that conferral of jurisdiction was rendered invalid by reason of inconsistency with s 39 of the Judiciary Act. The inconsistency arises because that conferral of jurisdiction undermines the operation and intended purpose of s 39, being to ensure that jurisdiction in the matters in ss 75 and 76 to which it applies is exclusively federal. For those reasons, NCAT had no jurisdiction to determine the complaints by Mr Burns against Ms Corbett and Mr Gaynor. Other issues By amended notices of contention, Ms Corbett and Mr Gaynor advanced several further arguments as to why the appeals to this Court should be dismissed. The contention that no State jurisdiction at all could be exercised in matters between residents of different States after Federation should be rejected for the reasons given earlier224. The remaining issues identified in the notices of contention were abandoned or otherwise not pressed at the hearing of the appeals. They need not be addressed in view of the conclusion reached on the principal issue in this Court. Conclusion Each appeal should be dismissed and orders made as proposed in the joint judgment of Kiefel CJ, Bell and Keane JJ. 223 See generally Davis v The Commonwealth (1988) 166 CLR 79; [1988] HCA 63. 224 See [168]-[170] above. Edelman Introduction Immediately before Federation, the Parliaments of Australian colonies had plenary legislative powers to pass laws for the peace, welfare and good government of the colony. By s 107 of the Constitution, these powers were to continue unless they were exclusively vested in the Parliament of the Commonwealth or withdrawn from the Parliament of a State. The primary submission by the Attorney-General of the Commonwealth in these appeals was that Ch III of the Constitution impliedly withdrew from State Parliaments part of these legislative powers. The implied withdrawal was said to be that State Parliaments would no longer have the power that colonial Parliaments had to confer jurisdiction on administrative tribunals over particular subject matters. The facts and background to these appeals are described by Gordon J in her Honour's reasons and need not be repeated. It suffices to say that the power said by the Attorney-General of the Commonwealth to have been impliedly withdrawn was State legislative power to confer jurisdiction upon administrative tribunals to decide diversity cases. These are cases where one party is, or becomes, a resident of a different State. If accepted, this submission would not be confined to the implied removal of State legislative power to confer diversity jurisdiction upon tribunals. It would also mean that there was an implied removal of State legislative power to confer jurisdiction on tribunals over admiralty and maritime matters225. There was, and is, no necessity for this proposed constitutional implication. In the United States, the justification for including diversity jurisdiction as a head of federal jurisdiction remains controversial226. But, whatever the justification, there was no need in the United States to exclude State legislative power over this subject. This was because Congress had an implied power to make the matters described in Art III, §2 exclusive to federal courts227. The United States scheme was replicated in Australia in s 77(ii) of the Constitution. That sub-section provides the Commonwealth Parliament with an 225 See Constitution, s 76(iii). 226 Friendly, "The Historic Basis of Diversity Jurisdiction", (1928) 41 Harvard Law Review 483; Yntema and Jaffin, "Preliminary Analysis of Concurrent Jurisdiction", (1931) 79 University of Pennsylvania Law Review 869. Discussed in Cowen, "Diversity Jurisdiction: The Australian Experience", (1955-1957) 7 Res Judicatae 1 at 3. Cf Baltimore and Ohio Railroad Co v Baugh 149 US 368 at 372-373 (1893), quoting Burgess v Seligman 107 US 20 at 33-34 (1883). 227 Kent and Lacy, Commentaries on American Law, rev ed (1889), vol 1 at 319. Edelman express power to make matters, including those involving a diversity of parties, exclusive to federal courts. Section 77(ii) was "merely an explicit enactment of what in the Constitution of the United States [was] held to be implied"228. At the time of Australian Federation there were hundreds of State administrative tribunals in the United States exercising powers of adjudication, including in diversity cases. Their numbers were rapidly expanding. Likewise, in Australia, tribunals exercising diversity jurisdiction and admiralty or maritime jurisdiction proliferated. An implied withdrawal of State power to confer diversity, admiralty or maritime jurisdiction upon a tribunal would have meant that State Customs Commissioners no longer had power to determine a dispute if an importer or consignee in the dispute was a resident of a different State, or if the dispute with the shipper was within "Admiralty and maritime jurisdiction". It would have meant that the continuing jurisdiction of established tribunals, such as the local Land Boards or Boards of Railway Commissioners, would be reduced to exclude the resolution of disputes involving persons who became residents of another State. It would have meant that local Marine Boards would have had no maritime jurisdiction. In each case, the relevant State would have been required to transfer that jurisdiction to a State court. The implication would also have meant that Imperial Vice-Admiralty Courts in New South Wales and Victoria ceased to exist because they were not State courts. No authority compels that this implication now be drawn from the Constitution 117 years after Federation. The implication was not made by this Court in R v Kirby; Ex parte Boilermakers' Society of Australia ("the Boilermakers' Case")229. On the contrary, the assumption by the majority in the Boilermakers' Case230, relying upon the approach taken in the United States, was that there was a separation of federal judicial power and federal executive power. It was, emphatically, not that there was a separation of State judicial power and State executive power. Since Federation, and until very recently, the States have assumed that, subject to exclusion by a Commonwealth law, they have legislative power to confer jurisdiction on tribunals in diversity, admiralty and maritime matters. That assumption is correct. In the alternative, the Attorney-General of the Commonwealth submitted that ss 38 and 39 of the Judiciary Act 1903 (Cth) were, in part, an exercise of the Commonwealth power pursuant to s 77(ii) of the Constitution to exclude State diversity jurisdiction. He submitted that s 109 of the Constitution rendered 228 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 229 (1956) 94 CLR 254; [1956] HCA 10. 230 See (1956) 94 CLR 254 at 270, 274-275, 276. Edelman inoperative any State law conferring jurisdiction over the same subject matter upon bodies other than State courts. The first part of that submission should be accepted. However, it is not necessary that the State law be understood as rendered inoperative by reason of s 109 of the Constitution. It can more simply be seen as rendered inoperative directly by the exercise by ss 38 and 39 of the Judiciary Act of the power to exclude in s 77(ii) of the Constitution. The reasons for these conclusions are set out in more detail as follows below. I respectfully acknowledge the considerable assistance that I have derived from the lucid reasons in the Court of Appeal of the Supreme Court of New South Wales of Leeming JA, with whom Bathurst CJ and Beazley P agreed231. Pre-Federation and post-Federation history A new constitutional implication? Section 77 of the Constitution and the proposed implication The implication is inconsistent with the United States model (iii) The text of s 77(ii) does not require the implication The implication is inconsistent with the historical context of s 77(ii) (a) Vice-Admiralty Courts Local Marine Boards Local Land Boards (d) Other State Commissioners and Boards No principled basis for the implication (vi) No basis for any extension of the Boilermakers implication The effect of ss 38 and 39 of the Judiciary Act Conclusion 231 Burns v Corbett (2017) 343 ALR 690. Edelman Pre-Federation and post-Federation history The implication proposed by the Attorney-General of the Commonwealth relied heavily upon a narrow meaning of s 77(ii) of the Constitution. Apart from lacking a principled basis, that narrow meaning is inconsistent with the historical model and the historical context of s 77(ii) at Federation. In the discussion in Pt B of these reasons, the period before Federation is taken as the starting point from which to construe the meaning of s 77(ii) and any proposed implication from it and Ch III. The submissions of every counsel in this case properly accepted the relevance of legal history to the proposed constitutional implication. The submissions were based upon two assumptions. It would be a distraction from the issues in this case to debate the precise foundations and method of application of those assumptions. It suffices to say that they are both well- established. The first was that an understanding of the history and context of a provision, viewed objectively without personal prejudices or preferences of the construing judge, assists in the process of characterising the "contemporary [or, perhaps more accurately, contemporary essential232] meaning of language used, the subject to which that language was directed and the nature and objectives of the movement towards federation from which the compact of the Constitution finally emerged"233. The second assumption was that this enduring meaning of constitutional language, at the level of generality at which its context requires characterisation, is only one dimension of constitutional adjudication234. Another dimension is constitutional practice, which includes the "fit" that a proposed meaning would have with judicial decisions, with the reasoning supporting those 232 Attorney General for NSW v Brewery Employes Union of NSW (1908) 6 CLR 469 at 560, 616; [1908] HCA 94; Huddart, Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330 at 375; [1909] HCA 36; Hughes and Vale Pty Ltd v The State of New South Wales [No 2] (1955) 93 CLR 127 at 224; [1955] HCA 28; Dennis Hotels Pty Ltd v Victoria (1960) 104 CLR 529 at 608; [1960] HCA 10; Davis v The Commonwealth (1988) 166 CLR 79 at 96-97; [1988] HCA 63; Cheatle v The Queen (1993) 177 CLR 541 at 552, 560; [1993] HCA 44; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 93 [24]; [2000] HCA 57; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 123 [212]; [2001] HCA 22; Brownlee v The Queen (2001) 207 CLR 278 at 299 [58]; [2001] HCA 36; Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 75 [187]; [2009] HCA 23; Graham v Minister for Immigration and Border Protection (2017) 91 ALJR 890 at 909 [79]; 347 ALR 350 at 369; [2017] HCA 33. 233 Cole v Whitfield (1988) 165 CLR 360 at 385; [1988] HCA 18. 234 Dworkin, Justice in Robes, (2006) at 117-118. Edelman decisions235, and with practice that relies upon clear, consistent, and longstanding professional opinion236. In the face of a powerful historical analysis in these appeals, particularly that presented by the Attorneys-General for New South Wales, Queensland, and Western Australia, the Attorney-General of the Commonwealth relied upon three post-Federation developments in this Court effectively in support of a constitutional practice underpinning the proposed implication and shaping the meaning of s 77(ii) despite the context in which it was enacted. These developments were the Boilermakers' Case, The Commonwealth v Queensland ("the Queen of Queensland Case")237, and K-Generation Pty Ltd v Liquor Licensing Court238. As I explain below, none of these cases provides any real support for the recognition of this proposed new implication. A new constitutional implication? Section 77 of the Constitution and the proposed implication Section 77 of the Constitution established a scheme by which the Commonwealth Parliament had power to define the jurisdiction of federal courts other than the High Court (s 77(i)) and to invest any court of a State with federal jurisdiction (s 77(iii)). The federal jurisdiction with which a court of a State could be invested, or about which a federal court's jurisdiction could be defined, was "[w]ith respect to" any of the nine subject matters in ss 75 and 76. Even without the exercise of power under s 77(i) or s 77(iii), prior to Federation the colonial courts already possessed jurisdiction with respect to some of the subject matters in ss 75 and 76. One instance, included in s 75(iv), was the authority of the colonial courts to decide matters "between residents of different States" (who were then residents of different colonies). That authority concerned "controversies well known in the anterior body of general jurisprudence in the colonies"239. Another, in s 76(iii), was "Admiralty and maritime jurisdiction". Those were two instances of that subject matter jurisdiction that belonged to the 235 Winterton, "Popular Sovereignty and Constitutional Continuity", (1998) 26 Federal Law Review 1 at 2; Re Lambie (2018) 351 ALR 559 at 582 [79]; [2018] HCA 6. 236 Baker, The Law's Two Bodies, (2001) at 66. 237 (1975) 134 CLR 298; [1975] HCA 43. 238 (2009) 237 CLR 501; [2009] HCA 4. 239 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 [25]; [2008] HCA 28. Edelman colonial courts. There may have been more. They were matters about which State legislative power was continued by s 107 of the Constitution. In the United States, following Alexander Hamilton's essay, published in 1788 as The Federalist No 82, that State jurisdiction was described as "concurrent"240. In a passage quoted by Hart and Wechsler241, Hamilton considered whether Art III, §2 of the United States Constitution, in vesting the judicial power of the United States in the Supreme Court and any federal court created by Congress, had impliedly excluded the legislative powers of the States in relation to the concurrent jurisdiction of State courts. He concluded that since this construction "would amount to an alienation of state power by implication", the alternative appeared to him to be "the most defensible construction"242. Following the United States, in Australia the language of "concurrent" State jurisdiction was also used to describe State jurisdiction that existed in relation to any of these matters243, including in cl 7 of Ch III of the Draft Bill of 1891244, which was the foundation for s 77(ii) of the Constitution. Section 77(ii) of the Constitution, following the United States model, provides that with respect to the matters in ss 75 and 76, the Commonwealth Parliament may make laws "defining the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to or is invested in the courts of the States" (emphasis added). The jurisdiction belonging to, or "vested"245 in, the courts of the States was the concurrent State jurisdiction. 240 Martin v Hunter's Lessee 14 US 304 at 337 (1816); Story, Commentaries on the Constitution of the United States, (1833), vol 3 at 622-623, §1749; Kent and Lacy, Commentaries on American Law, rev ed (1889), vol 1 at 319. 241 Fallon et al, Hart and Wechsler's The Federal Courts and the Federal System, 6th ed (2009) at 383. 242 The Federalist No 82, in The Federalist, on the New Constitution, (1802), vol 2 at 243 Official Report of the National Australasian Convention Debates, (Sydney), 31 March 1891 at 528; Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 784. 244 As extracted in Williams, The Australian Constitution: A Documentary History, 245 For which the Imperial Parliament substituted "invested", in a change described by Quick and Garran as per incuriam: Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 801. Edelman The Attorney-General of the Commonwealth submitted that the words emphasised above embodied an assumption that the concurrent State jurisdiction could only be exercised by courts. That submission and implication is inconsistent with the United States model, upon which s 77(ii) was based. It is not required by the text of s 77(ii). It is inconsistent with the historical context of s 77(ii). It has no principled basis. And it is not required by authority. The implication is inconsistent with the United States model Section 77(ii) of the Constitution made express that legislative power to exclude which was implied in the United States. At the time of Australian Federation it was clear that the concurrent State power in the United States was not limited to courts. Hamilton's reasoning that Art III, §2 of the United States Constitution had not impliedly alienated State power applied equally to the concurrent jurisdiction of State administrative tribunals. The operation of the United States model, upon which s 77(ii) was based, had the effect that unless Congress were to legislate to make exclusive the authority to adjudicate upon diversity matters, that authority would remain shared between the United States and State bodies, including both courts and administrative tribunals. There were hundreds of State tribunals in the United States exercising powers of adjudication. The powers were exercised over diversity matters246. Their numbers were also rapidly expanding. In 1903 alone, about 140 new State tribunals were created in the United States247. It was said that, by 1938, the United States was "practically governed by administrative tribunals", which tried more cases than the courts, including the determination of "[i]mportant issues and affairs of vital moment, both to the individual and to the nation as a whole"248. (iii) The text of s 77(ii) does not require the implication The text of s 77(ii) assumed importance in these appeals because the meaning of s 77(ii) is a crucial consideration in ascertaining whether the Commonwealth has power to exclude all State jurisdiction where it exists concurrently over subject matters contained in ss 75 and 76. On any view, a constitutional implication removing part of a State's concurrent power could not 246 See, eg, Madisonville Traction Co v Saint Bernard Mining Co 196 US 239 (1905). 247 Bowman, "American Administrative Tribunals", (1906) 21 Political Science Quarterly 609 at 613. 248 Riedl, "Should Rules of Evidence Govern Fact-Finding Boards?", (1938) 23 Marquette Law Review 13 at 14. Edelman be necessary if there is Commonwealth power to exclude the concurrent State power. The Attorneys-General of the Commonwealth and Western Australia submitted that the Commonwealth has power to exclude State legislation conferring concurrent State jurisdiction over State administrative tribunals in diversity matters. That submission relied upon s 77(ii) in combination with s 51(xxxix). In effect, their submission was that the power to exclude in s 77(ii) went beyond the literal terms of that sub-section due to the incidental power. Although it may ultimately be a question of degree as to when the meaning of an expression will include matters that are impliedly incidental to it without regard to an express incidental extension, the power to exclude all State jurisdiction with respect to matters in ss 75 and 76 of the Constitution is best seen as arising from s 77(ii) itself without the need to rely upon s 51(xxxix). The focus of s 77(ii) is upon a power to make exclusive the jurisdiction of any federal court. The expression "any federal court" in s 77(ii) includes the High Court (unlike in s 77(i), which excludes the High Court). The power therefore includes the ability to make the existing federal jurisdiction of the High Court over matters in ss 75 and 76 exclusive of "that which belongs to or is invested in the courts of the States". It is an immediate power to exclude. The notion of exclusivity usually connotes jurisdiction exclusive of all other authority. This unsurprising proposition is supported by the drafting history of s 77(ii). The terms of 77(ii) were "substantially contained"249 in cl 7 of Ch III of the Draft Bill of 1891250. That clause provided that original federal jurisdiction "may be exclusive, or may be concurrent with that of the Courts of the States". It continued, saying that "exclusive jurisdiction shall not be conferred on a Court except in respect of the following matters", which matters were the early draft of the heads of federal jurisdiction. This drafting history emphasises that the purpose of the provision that became s 77(ii) was to provide the Commonwealth Parliament with a power to make federal jurisdiction exclusive of all other authority. The reference to the possibility of jurisdiction "concurrent with that of the Courts of the States" was merely descriptive of the alternative to exclusive authority (ie concurrent authority). That alternative did not confine the power to make federal jurisdiction exclusive. If the Commonwealth Parliament chose not to make federal jurisdiction exclusive, and instead vested in new federal courts a 249 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 250 As extracted in Williams, The Australian Constitution: A Documentary History, Edelman jurisdiction that was concurrent with that of the State courts, then the new federal jurisdiction could also be concurrent with any existing State jurisdiction of State administrative tribunals. Although the final the power of text of s 77(ii) describes the Commonwealth Parliament in terms of making the federal jurisdiction exclusive of the concurrent jurisdiction of the State courts, this phrase similarly need not be construed as assuming that the only repository of concurrent State jurisdiction is State courts and not State tribunals. It could equally be construed as based on the assumption, which was given effect by this Court in 2010 as an implication from which State Parliaments could not detract251, that decisions of an administrative tribunal could generally be reviewed by a State court so that they were not "islands of power immune from supervision and restraint"252. Indeed, the assumption would be considerably narrower. It would be only that State administrative tribunals adjudicating with concurrent State jurisdiction over diversity, admiralty and maritime matters would not exist entirely independently of State courts so that the power to make federal jurisdiction exclusive of State courts would make the same jurisdiction exclusive of State administrative tribunals. That assumption would explain the focus of s 77(ii) on "courts of the States", because, by making federal jurisdiction exclusive of the courts of the States, the jurisdiction must also be capable of being made exclusive of the tribunals of the States in relation to those subject matters. There is a further explanation for the failure of the drafters of s 77(ii) to specify "tribunals" as another type of body of which the jurisdiction of the federal courts could be made exclusive. As Fry LJ said, when considering common law immunity from suit, "tribunal" had no ascertainable meaning and its inclusion alongside "court" was legally embarrassing253. This explanation does not deny the fundamental importance of the legal distinction between federal courts and federal administrative bodies that emerged at least by the time of the Boilermakers' Case. It merely illustrates a contextual reason why the concurrent jurisdiction of the States was described by reference to courts rather than by reference to "courts and tribunals" or even, in more cumbersome language, "courts, or other bodies conferred with judicial power that might not fulfil the essential requirements for a court". 251 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 580-581 [98]-[100]; [2010] HCA 1. 252 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 581 [99]. 253 Royal Aquarium and Summer and Winter Garden Society v Parkinson [1892] 1 QB Edelman The implication is inconsistent with the historical context of s 77(ii) As in the United States, there was a proliferation of administrative bodies in Australia including administrative bodies exercising judicial power over diversity, admiralty and maritime matters. In The State of New South Wales v The Commonwealth ("the Wheat Case")254, Griffith CJ observed that it had "been the practice for many years in the United Kingdom and in the Australian Colonies and States to confer quasi-judicial powers upon officers of Government and administrative bodies". The existence of these colonial bodies having diversity, admiralty and maritime jurisdiction is evidence of a "common [assumption] tacitly made and acted upon"255 that such bodies, having such jurisdiction, would continue in existence. That common assumption militates against the existence of an unexpressed background implication in Ch III of the Constitution that removed this jurisdiction. Further, at the time of Federation, in New South Wales and Victoria there were Vice-Admiralty Courts, with jurisdiction from the High Court of Admiralty. They were not courts of the States. It is convenient to begin with those Courts and then turn to the colonial tribunals to illustrate the strength of the common assumption at Federation. (a) Vice-Admiralty Courts From 1841256, judges of the Supreme Courts of the colonies held concurrent commissions, by appointment from British Admiralty, as judges of the Vice-Admiralty Court257. This Court derived its authority from the English High Court of Admiralty258. Although the same Vice-Admiralty Courts had been abolished in the United States during independence259, they remained in Australia until the Colonial Courts of Admiralty Act 1890 (Imp)260. That Act created 254 (1915) 20 CLR 54 at 63; [1915] HCA 17. 255 Boilermakers' Case (1956) 94 CLR 254 at 296. 256 Ying, "Colonial and Federal Admiralty Jurisdiction", (1981) 12 Federal Law Review 236 at 241. 257 The Yuri Maru and The Woron [1927] AC 906 at 912. See also McIlwraith McEacharn Ltd v Shell Co of Australia Ltd (1945) 70 CLR 175 at 190; [1945] HCA 11. 258 Ying, "Colonial and Federal Admiralty Jurisdiction", (1981) 12 Federal Law Review 236 at 241. 259 Frank, "Historical Bases of the Federal Judicial System", (1948) 13 Law and Contemporary Problems 3 at 7. 260 53 & 54 Vict c 27. Edelman Colonial Courts of Admiralty with jurisdiction exercised "within the structure of the ordinary judicial system"261. However, the Act did not take effect in New South Wales and Victoria until 1911, when an Order in Council appointed 1 July 1911 as the date of commencement262. As the Attorney-General for Western Australia submitted in oral argument, the existence, until 1911, of the Courts of Vice-Admiralty in New South Wales and Victoria is inconsistent with an implication that only "the courts of the States" could exercise admiralty jurisdiction. It would be no more accurate to assert that the Vice-Admiralty Courts stood outside the scheme of Ch III of the Constitution than it would be to assert that administrative boards and tribunals established under British legislation stood outside the scheme of Ch III of the Constitution. There is no principled basis for such a distinction. As Quick and Garran observed, the Vice-Admiralty Courts could not be called "courts of the States"263. Yet, despite falling outside the words in s 77(ii), it does not seem ever to have been contemplated that these Courts might have been abolished by a negative implication flowing from Ch III generally or s 77(ii) specifically. On the contrary, it seemed "clear that the constitution of those courts [was] not in any way affected by the establishment of the Commonwealth"264. Local Marine Boards The Merchant Shipping Act Amendment Act 1862 (Imp)265 vested the power266 of cancelling or suspending the certificate of a master, mate, or engineer in the "Local Marine Board ... or other Court or Tribunal" by which the case was 261 Ying, "Colonial and Federal Admiralty Jurisdiction", (1981) 12 Federal Law Review 236 at 241. See also McIlwraith McEacharn Ltd v Shell Co of Australia Ltd (1945) 70 CLR 175 at 189-191. 262 United Kingdom, The Statutory Rules & Orders and Statutory Instruments Revised to December 31, 1948, (1950), vol 4 at 697. See also Ying, "Colonial and Federal Admiralty Jurisdiction", (1981) 12 Federal Law Review 236 at 241. 263 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 264 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 265 25 & 26 Vict c 63, s 23(1). 266 A similar power existed in s 242 of the Merchant Shipping Act 1854 (17 & 18 Vict c 104). Edelman to be investigated or tried. The "Board, Court, or Tribunal" was required by s 23(3) to state the decision in open court and to send a full report of the case to the Board of Trade. Before Federation, colonial Parliaments also enacted legislation creating courts or tribunals to exercise these powers267. These local tribunals exercised both colonial administrative power and colonial "Admiralty and maritime" jurisdiction. In 1876, Sir James Martin CJ (with whom Hargrave J agreed) considered the New South Wales Marine Board's power to investigate the cause of a collision, saying that268: "I am clearly of opinion that the Board forms such a Court to which a prohibition will issue. It has all the elements of a Court – the power of summoning parties and witnesses, and punishing them if they disobeyed the summons – of hearing evidence on oath administered, and of deciding questions which might deprive persons of civil rights." Although the New South Wales Marine Board might have been characterised as a court, in 1899 the New South Wales Parliament enacted legislation, which was reserved for Royal Assent, transferring the powers of the Marine Board to the Superintendent of the Department of Navigation, except for its powers to fix salaries or fees, to make or recommend the making of rules or regulations, and to appoint, suspend or dismiss officers, or recommend them for appointment, suspension or dismissal269. In Queensland, where the Marine Board was not described as a court, it was also recognised that some of the powers exercised by the Marine Board were judicial powers. In Burrey v Marine Board of Queensland270, Harding J (with whom the Chief Justice and Real J agreed) described the Marine Board as a "tribunal for investigating certain things" and characterised the inquiry or investigation by the Marine Board into the suspension of Mr Burrey's certificate as a "judicial proceeding, where a man's conduct was called into question", and 267 Navigation Act 1876 (Q) (41 Vict No 3), ss 5, 38; Marine Board and Navigation Act 1881 (SA) (44 & 45 Vict No 237), ss 134, 136; Marine Act 1890 (Vic) (54 Vict No 1165), ss 180, 183, replicating Marine Board Act 1887 (Vic) (52 Vict No 965), ss 133, 136; Marine Boards Act 1889 (Tas) (53 Vict No 34), ss 5, 6, 130, 159, 176, 179; Navigation Act 1871 (NSW) (35 Vict No 7), ss 5, 19. 268 Ex parte Dalton (1876) 14 SCR (NSW) (L) 277 at 281. 269 Navigation (Amendment) Act 1899 (NSW), s 2. 270 (1892) 4 QLJ 151 at 152-153. Edelman said that the investigation under s 37(3) of the Navigation Act 1876 (Q)271 was a "judicial investigation". For their entire existence, in some cases for many decades after Federation, it was never suggested that any of the local State Marine Boards (or the New South Wales Superintendent) were invalidly constituted due to an implication from Ch III of the Constitution that prevented them from exercising State jurisdiction over admiralty and maritime matters. In contrast, when a Court of Marine Inquiry was established under the Navigation Act 1912 (Cth), the validity of that Commonwealth legislation was challenged on grounds which included that the Court of Marine Inquiry was not a court within the meaning of Ch III and, therefore, could not exercise judicial power272. In R v Turner; Ex parte Marine Board of Hobart273, the issue was whether the proper court to conduct an inquiry was the one established under the Marine Act 1921 (Tas) or the Court of Marine Inquiry established under the Navigation Act. There was no dispute that the Tasmanian tribunal had the power to conduct the inquiry, subject to it being "superseded" by the Court of Marine Inquiry274. A majority of the Court held that the jurisdiction of the Court of Marine Inquiry did not extend to the circumstances of the inquiry275. However, in separate dissents, Isaacs and Higgins JJ turned to Tasmania's alternative argument that the Court of Marine Inquiry was exercising judicial power contrary to Ch III. Isaacs J held that the Court of Marine Inquiry was not a court within the meaning of Ch III of the Constitution and that, in any event, its functions were "not necessarily judicial"276. The particular power of inquiry was not a judicial power so there was no relevant invalidity, "whatever might be otherwise thought" about other provisions277. Higgins J also concluded that the holding of the inquiry was not an exercise of the judicial power of the Commonwealth278. 271 41 Vict No 3. 272 R v Turner; Ex parte Marine Board of Hobart (1927) 39 CLR 411 at 421-422; [1927] HCA 15. 273 (1927) 39 CLR 411. 274 (1927) 39 CLR 411 at 423-424. 275 (1927) 39 CLR 411 at 425. 276 (1927) 39 CLR 411 at 442. 277 (1927) 39 CLR 411 at 442. 278 (1927) 39 CLR 411 at 450. Edelman Local Land Boards Another example of local tribunals that exercised judicial power, including in diversity matters, was local Land Boards. In Queensland, Griffith CJ described the Land Board established under the Crown Lands Act 1884 (Q)279 as one "whose functions are partly judicial and partly advisory"280. In South Australia, Gwynne J described the powers of the laymen Real Property Act Commissioners as "very high judicial powers"281. Indeed, in Tasmania claims and applications for grants of land had been part of the jurisdiction of the Supreme Court since 1858282. In New South Wales, the Local Land Boards established pursuant to the Crown Lands Act 1884 (NSW)283 sat and gave their decisions in open court with the power to compel the attendance of witnesses. As Leeming JA observed in the Court of Appeal in these appeals284, Darley CJ had remarked in 1899 that the Boards were constituted by "men ... without any legal training or any possible knowledge of an abstruse equitable doctrine"285. Section 18 of the Crown Lands Act also gave the Minister the power to hear appeals. Although Darley CJ had doubted "whether the Legislature could really have intended to impose upon a lay tribunal such as a Land Board the duty of determining questions of so great nicety and difficulty", in the Privy Council Lord Macnaghten said that it was enough to say that the language of the Act was "perfectly clear, and that both the inquiries referred to the Land Board by the Minister for Lands [were] within the express words of the section"286. 279 48 Vict No 28. Replaced by a newly constituted Land Court from 1 March 1898 by the Land Act 1897 (Q) (61 Vict No 25). 280 Re Powell (1893) 6 QLJ 36 at 38. 281 Palmer v Andrews (Nominal Defendant) (1874) 8 SALR 281 at 287. 282 Claims to Grants of Land Act, No 3 1858 (Tas) (22 Vict No 10), s 1. 283 48 Vict No 18, ss 11, 14. 284 Burns v Corbett (2017) 343 ALR 690 at 705 [59]. 285 Wilson v Minister for Lands (1899) 20 LR (NSW) (L) 104 at 109. 286 Minister for Lands v Wilson [1901] AC 315 at 323. Edelman (d) Other State Commissioners and Boards Prior to, or around the time of, Federation, legislation in the colonies established various other Commissioners and Boards with an assortment of judicial powers. Those powers were exercised in a variety of circumstances, including in diversity cases. Some examples of these Commissioners and Boards were Railway Commissioners287, the dental board of New South Wales, which in considering charges of infamous conduct was obliged to sit in open court288, and Land Tax Commissioners289. Commissioners of Customs (in South Australia, named the Collector for Port Adelaide) had jurisdiction to determine disputes between an officer of Customs and other persons290. For instance, in Victoria the Commissioner of Trade and Customs determined various disputes arising in the port of Melbourne, including those between masters or owners of ships, importers, consignees, or exporters, and any officer of Customs291. In Tasmania these disputes could, in certain circumstances, be heard and finally determined by the Minister, with any orders for penalties or forfeiture given the force of an order of the Justices sitting in Petty Sessions292. Many of these disputes must have involved diversity jurisdiction or admiralty or maritime jurisdiction. No principled basis for the implication The Attorney-General of the Commonwealth suggested one principled basis for the implication. His submission was that, unless the exercise of this power by tribunals was excluded, the States could easily defeat a Commonwealth attempt under s 77(ii) of the Constitution to make federal courts the exclusive repository for the exercise of judicial power over ss 75 and 76 subject matters. However, as the Solicitor-General properly accepted in oral submissions, such a basis "would not carry great weight" if Commonwealth legislation were capable of excluding the concurrent exercise of State judicial power over these subject matters by administrative tribunals. Commonwealth legislation under s 77(ii) is, indeed, so capable. 287 Railways Act 1890 (Vic) (54 Vict No 1135), Pt II, Div 1; Government Railways Act 1901 (NSW), Pt II. 288 Dentists Act 1900 (NSW), ss 3, 9. 289 Land Tax Act 1877 (Vic) (41 Vict No 575), s 9. 290 Customs Act 1864 (SA) (27 & 28 Vict No 19), s 138; Customs Regulation Act 1879 (NSW) (42 Vict No 19), s 23; Customs Act 1890 (Vic) (54 Vict No 1081), s 38. 291 Customs Act 1890 (Vic) (54 Vict No 1081), s 38. 292 Customs Act 1897 (Tas) (61 Vict No 6), ss 19, 20. Edelman Another potential basis for the proposed implication might be a need to ensure that only a State judge could exercise State diversity jurisdiction. But even federal diversity jurisdiction can be exercised by non-judges. A State "court" in s 77(iii), which can be invested with federal jurisdiction, has been described as "an organization for the administration of justice, consisting of judges and with ministerial officers having specified functions"293. Ministerial officers include Masters and Registrars294. The Master or Registrar can exercise federal diversity jurisdiction, subject to review, even if the Master295 or Registrar296 is not a member or constituent part of the court297. In The Commonwealth v Hospital Contribution Fund298, Gibbs CJ (with whom Stephen J agreed) went so far as to suggest that "a court composed of laymen, with no security of tenure, might effectively be invested with jurisdiction under s 77(iii)". A further reason for the proposed implication could be that State jurisdiction over diversity, admiralty and maritime matters was of such a nature that it could never be entrusted to bodies other than State courts. The Attorney- General of the Commonwealth properly abstained from making this submission. There are two basic problems with it. First, a purported purpose that administrative tribunals could not be entrusted with diversity, admiralty or maritime jurisdiction would have to turn upon whether the tribunal could be described as a "court", a word of protean quality299 which, at the State level, could not easily be differentiated from a non- 293 Kotsis v Kotsis (1970) 122 CLR 69 at 91; [1970] HCA 61; The Commonwealth v Hospital Contribution Fund (1982) 150 CLR 49 at 58, 60; [1982] HCA 13. 294 See Harris v Caladine (1991) 172 CLR 84 at 92, 93-94, 121, 148-149, 163-164; cf at 108, 138-139; [1991] HCA 9. 295 The Commonwealth v Hospital Contribution Fund (1982) 150 CLR 49, considering Supreme Court Act 1970 (NSW), s 25. 296 Supreme Court Act 1935 (WA), s 6; cf Supreme Court Act 1935 (SA), s 7; Constitution Act 1975 (Vic), s 75(2). 297 Constitution, s 79. 298 (1982) 150 CLR 49 at 57. See also at 66 per Murphy J ("subject to review or appeal"). 299 Trust Company of Australia Ltd v Skiwing Pty Ltd (2006) 66 NSWLR 77 at 81 [17]. See also Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 76 [64]; [2006] HCA 44. Edelman court tribunal300. However important the distinction between courts and non- court tribunals at federal level is today, that distinction could not support a justification or purpose in 1901 that drew a sharp distinction at State level between the trust to be afforded to State administrative bodies compared with State courts. State courts included the many justices of the peace301 and magistrates302 of State courts, who exercised many administrative powers as members of the public service303. Further, all those exercising judicial power, whether as judges or not, and whether on courts or not, were required to do so in a judicial manner, that is, according to reason and justice304. Secondly, this purported the historical record does not support justification. At Federation there does not appear to have existed a clear distrust of administrative tribunals or decision makers as compared with courts. As I they explained above, administrative decision makers proliferated and adjudicated on admiralty and maritime matters and diversity matters, as well as general matters of national importance. In this respect, Australia was in the same position as the United States. Diversity jurisdiction was included as a head of federal jurisdiction not because it had any special importance requiring only a court to adjudicate upon it. As Mr Dixon KC observed in evidence before the Royal Commission on the Constitution in 1927, there was no better reason for inclusion in the Australian Constitution of diversity jurisdiction as a subject matter of federal jurisdiction "than the desire to imitate an American model"305. 300 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 573 [69]. 301 Jaffe and Henderson, "Judicial Review and the Rule of Law: Historical Origins", (1956) 72 Law Quarterly Review 345 at 363. See also Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 92 ALJR 248 at 271 [91]; 351 ALR 225 at 250; [2018] HCA 4. 302 Trust Company of Australia Ltd v Skiwing Pty Ltd (2006) 66 NSWLR 77 at 89 303 North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 165 [37]; [2004] HCA 31. 304 Sharp v Wakefield [1891] AC 173 at 179; R v London County Council; Ex parte Akkersdyk; Ex parte Fermenia [1892] 1 QB 190 at 195; Royal Aquarium and Summer and Winter Garden Society v Parkinson [1892] 1 QB 431 at 445, see also 305 Australia, Royal Commission on the Constitution of the Commonwealth: Minutes of Evidence, (1927), pt 3 at 785. See also Cowen, "Diversity Jurisdiction: The Australian Experience", (1955-1957) 7 Res Judicatae 1 at 4. Edelman There is one justification for the proposed implication that could be both principled and coherent. That justification would apply if the Constitution had been structured in such a way as to require a strict separation of powers at State level that mirrored the separation of powers at the federal level. If so, the exercise of State judicial power by an administrative tribunal in diversity, admiralty and maritime matters would infringe a strict separation of judicial and executive powers at State level. But, apart from limited and specific exceptions, the Constitution does not recognise or require a separation of powers at State level either generally or in relation to particular subject matters306. This Court's many statements that, by s 77 of the Constitution, the Commonwealth takes State courts as they are found (including with State non-judicial powers) assume the opposite, even if those statements are subject to particular exceptions307. (vi) No basis for any extension of the Boilermakers implication The Attorney-General of the Commonwealth submitted that the proposed implication was recognised in the Boilermakers' Case. That case was concerned with the separation of powers at the federal level. It established, as had generally been accepted in relation to the United States Constitution, that Ch III of the Constitution is an exhaustive statement of the manner in which the judicial power of the Commonwealth may be vested308. As the majority noted, "the effect of the framework of Art III [of the United States Constitution] was known and it was intended that the same broad principles affecting the judicial power should govern the situation of the judicature in the Commonwealth Constitution"309. However, the effect of the Attorney-General of the Commonwealth's submission was that the Boilermakers' Case had, without any obvious reason for doing so, 306 Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 598 [37]; [2004] HCA 46; International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 354 [53]; [2009] HCA 49; Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 573 [69]. 307 Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 599 [38], citing Federated Sawmill, Timberyard and General Woodworkers' Employes' Association (Adelaide Branch) v Alexander (1912) 15 CLR 308 at 313; [1912] HCA 42; Le Mesurier v Connor (1929) 42 CLR 481 at 496-498; [1929] HCA 41; Adams v Chas S Watson Pty Ltd (1938) 60 CLR 545 at 554-555; [1938] HCA 37; Peacock v Newtown Marrickville and General Co-operative Building Society No 4 Ltd (1943) 67 CLR 25 at 37; [1943] HCA 13; Kotsis v Kotsis (1970) 122 CLR 69 at 109; Russell v Russell (1976) 134 CLR 495 at 516-517, 530, 535, 554; [1976] HCA 23; The Commonwealth v Hospital Contribution Fund (1982) 150 CLR 49 at 61. 308 Boilermakers' Case (1956) 94 CLR 254 at 270. 309 Boilermakers' Case (1956) 94 CLR 254 at 297. Edelman established an implication contrary to that which had been accepted in the United States. The Attorney-General of the Commonwealth submitted that the majority in the Boilermakers' Case recognised an implied limitation upon State legislative powers in relation to matters such as diversity, admiralty and maritime matters in the following passage310: "The conception of independent governments existing in the one area and exercising powers in different fields of action carefully defined by law could not be carried into practical effect unless the ultimate responsibility of deciding upon the limits of the respective powers of the governments were placed in the federal judicature. The demarcation of the powers of the judicature, the constitution of the courts of which it consists and the maintenance of its distinct functions become therefore a consideration of equal importance to the States and the Commonwealth. While the constitutional sphere of the judicature of the States must be secured from encroachment, it cannot be left to the judicial power of the States to determine either the ambit of federal power or the extent of the residuary power of the States." The majority continued as follows: "The powers of the federal judicature must therefore be at once paramount and limited. The organs to which federal judicial power may be entrusted must be defined, the manner in which they may be constituted must be prescribed and the content of their jurisdiction ascertained." In this passage, when read as a whole, the majority were emphasising that the jurisdiction of federal courts "was not to be left to the general discretion of the Parliament of the Commonwealth, still less the legislatures of the States"311. It was the paramount responsibility of the federal judicature to determine the boundaries of federal judicial power, being those matters inside the boundaries of federal judicial power and those matters outside the boundaries of federal judicial power (the residuary power of the States). The majority were not making any observation, contrary to the approach taken in the United States, about a lack of State judicial power over matters that fell within concurrent State legislative power. On the contrary, and apart from the boundaries of federal judicial power, the majority said that the constitutional sphere of the judicature of the States must be secured from encroachment. 310 (1956) 94 CLR 254 at 267-268. 311 Gould v Brown (1998) 193 CLR 346 at 422 [120]; [1998] HCA 6. See also Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 574-575 [111]; [1999] HCA 27. Edelman The Attorney-General of the Commonwealth also relied upon the Queen of Queensland Case as supporting the proposed implication. The simplest answer to that submission is that, as Leeming JA said in the Court of Appeal312, there was no issue in that case about the capacity of a State Parliament to confer judicial power on a tribunal. More particularly, as Leeming JA also observed313, the only comments in that case that might support the proposed implication were made by Jacobs J, with whom McTiernan J "substantially" agreed314. But, with respect to Jacobs J, the premise of his observations was simply wrong. In the Queen of Queensland Case this Court considered the validity of legislation of the Queensland Parliament that purported to confer power upon the Attorney-General of Queensland to, in particular circumstances, apply to the Supreme Court for a certificate that would permit a question to be referred to the Judicial Committee of the Privy Council. If a certificate were granted, the Governor in Council was required to request that Her Majesty make the referral. All members of the Court held that the legislation was invalid. In these appeals, the Attorney-General of the Commonwealth relied upon a passage where Gibbs J, with whom Barwick CJ, Stephen and Mason JJ agreed, said that315: "It is implicit in Ch III that it is not permissible for a State by legislation to provide a procedure by which the Judicial Committee is enabled to consider an inter se question in the absence of a certificate of this Court ... Legislation passed by a State which had that effect would violate the principles that underlie Ch III – that questions arising as to the limits of Commonwealth and State powers, having a peculiarly Australian character, and being of fundamental concern to the Australian people, should be decided finally in this Court ... In other words, such legislation would be contrary to the inhibitions which, if not express, are clearly implicit in Ch III." That passage was immediately preceded by his Honour's observation that Ch III enabled the Commonwealth Parliament to legislate so that all of the matters in ss 75 and 76, except possibly inter se questions, would be finally decided by the High Court and not the Judicial Committee316. The exercise of Commonwealth legislative power in that way meant, either expressly or 312 Burns v Corbett (2017) 343 ALR 690 at 712 [89]. 313 Burns v Corbett (2017) 343 ALR 690 at 711 [88]. 314 Queen of Queensland Case (1975) 134 CLR 298 at 303. 315 (1975) 134 CLR 298 at 314-315. 316 (1975) 134 CLR 298 at 314. Edelman impliedly, that the States could not legislate to achieve a different effect. This conclusion says nothing about the existence of State legislative power to confer State judicial power on a State tribunal prior to any exercise of Commonwealth legislative power. On the other hand, the implication does derive some support from the reasoning of Jacobs J. His Honour said that "[t]he subject matters under [ss 75 and 76] of the Constitution may only be considered and determined in exercise of the kind of judicial power envisaged under Ch III of the Constitution"317. This observation is not correct. As explained above, the States retained their colonial jurisdiction at least in relation to diversity matters (s 75(iv)) and admiralty and maritime matters (s 76(iii)). Finally, the Attorney-General of the Commonwealth relied upon comments made by five members of this Court in K-Generation Pty Ltd v Liquor Licensing Court318. There, Gummow, Hayne, Heydon, Crennan and Kiefel JJ said that there is "no doubt that, with respect to subject matter outside the heads of federal jurisdiction in ss 75 and 76 of the Constitution, the State legislatures may confer judicial powers on a body that is not a 'court of a State'". The effect of the submission was that this statement implied that State legislatures could not confer judicial powers on a non-court tribunal in respect of subject matters in ss 75 and 76. As Leeming JA observed in the Court of Appeal, this submission involves a basic logical fallacy: to say that the street is wet when it is raining does not mean that the street is dry when it is not raining319. Even more obviously, to say that there is "no doubt" that the street is wet when it is raining says nothing about whether and when the street will be dry. The effect of ss 38 and 39 of the Judiciary Act The alternative the Commonwealth was that ss 38 and 39 of the Judiciary Act invalidated the conferral by any State Parliament of State diversity jurisdiction upon a body other than a State court. That submission should be accepted. the Attorney-General of submission by For the reasons set out above, the power in s 77(ii) is not confined only to making exclusive of State courts the subject matters of federal jurisdiction. The power is to make federal jurisdiction exclusive of any and all State jurisdiction with respect to the subject matters in ss 75 and 76. The State jurisdiction that can be excluded is any concurrent State authority to exercise judicial power over 317 (1975) 134 CLR 298 at 328. 318 (2009) 237 CLR 501 at 544 [153]. 319 Burns v Corbett (2017) 343 ALR 690 at 713 [93]. Edelman those subject matters that had been vested in State courts or State tribunals which are subject to judicial review by State courts. Commonwealth legislation that is an exercise of the power to exclude under s 77(ii), if intended to be "a complete statement"320 of the circumstances in which jurisdiction over a particular subject matter can be exercised, does not require s 109 of the Constitution to render invalid any State legislative provision conferring authority over the same subject matter upon a State court or tribunal. Although an "accepted view" has been that State laws giving effect to the "belongs to" jurisdiction become inoperative by the operation of s 109321, the invalidity, in the sense of inoperability, can also be seen as arising directly from the exclusionary effect required by s 77(ii), just as the invalidity of the legislation in the Queen of Queensland Case was held to flow directly from the exclusionary effect of the exercise by the Commonwealth of its power under s 74, so that matters in ss 75 and 76 would be finally decided by the High Court. The only remaining question, then, is whether ss 38 and 39 of the Judiciary Act exercised, in full, the "power to exclude"322 in s 77(ii). If they did fully exercise that power to exclude then they would have (i) taken away the authority of State courts and administrative tribunals to exercise judicial powers over all matters in which the High Court had exclusive jurisdiction, including diversity matters, and (ii) given new federal authority to the State courts only, by the power in s 77(iii), to exercise their powers over these matters, including diversity matters. If the text of ss 38 and 39 were read literally, and without context, then those sections would apply only to courts and not to tribunals. However, one important matter of context is that the text of ss 38 and 39 borrowed from s 77 of the Constitution, including the phrase in s 39(1) of the Judiciary Act "exclusive of the jurisdiction of the ... Courts of the States". This is a strong indication that those sections should be construed in the same manner as s 77(ii), and as an exercise of the full breadth of its power. For the reasons expressed above in relation to ss 77(ii) of the Constitution, the description in ss 38 and 39(1) of the Judiciary Act of the jurisdiction of the High Court as "exclusive" should be 320 Victoria v The Commonwealth ("the Shipwrecks Case") (1937) 58 CLR 618 at 630; [1937] HCA 82. 321 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 [24], citing Felton v Mulligan (1971) 124 CLR 367 at 412-413; [1971] HCA 39; Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 471, 476; [1980] HCA 32. 322 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142; [1907] HCA 76. Edelman construed as being exclusive of all State jurisdiction of the nature of that concurrent jurisdiction invested in the several State courts. There is also a significant purpose underlying the construction of ss 38 and 39 as a scheme which fully exercised the power in s 77(ii). The "whole object"323 of the provisions was to place conditions upon the exercise of the previously concurrent State jurisdiction, including to ensure the existence of an appeal to this Court. If the State legislation in these appeals324 could operate alongside these provisions of the Judiciary Act to confer authority upon a non- court tribunal to exercise its powers in diversity matters, there would be a significant detraction from this scheme. The same diversity dispute could be adjudicated by a tribunal but without the conditions imposed by the Judiciary Act, including the possibility of appeal to this Court. It is not to the point that in some cases there might, ultimately, be a route to special leave if there were a power to bring an appeal or an application for judicial review of the matter to the New South Wales Supreme Court. In other cases this might not be so. There is no condition that would require an appeal to this Court to be ultimately available, with special leave, from a decision of a non-court tribunal. Conclusion These appeals were conducted on the considered assumption by all parties and interveners that the Civil and Administrative Tribunal of New South Wales was not a court of the State. The Attorney-General of the Commonwealth justified that assumption on the basis that the legislation constituting the tribunal does not expressly designate it as a court325, and that it lacks the minimum degree of independence and impartiality326, being an implied requirement of a court referred to in Ch III. No submissions were made about the qualities of the tribunal, or the basis for, or operation of, this required minimum, which, on one 323 Booth v Shelmerdine Bros Pty Ltd [1924] VLR 276 at 278. 324 Anti-Discrimination Act 1977 (NSW), Pt 9, Div 3, esp ss 95, 102-108; Civil and Administrative Tribunal Act 2013 (NSW), Sched 3, cl 3. 325 Cf K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501 at 529 [85], 562-563 [219]-[221]; Public Service Association and Professional Officers' Association Amalgamated of NSW v Director of Public Employment (2012) 250 CLR 343 at 352 [12]; [2012] HCA 58. 326 North Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146 at 163 [29]; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 81 [78]. Edelman view327, includes the obligation of courts to act judicially, a longstanding characteristic of all bodies exercising judicial power328. No new constitutional implication should be recognised. The legislative power that States would otherwise have had to confer State diversity jurisdiction on State tribunals was not withdrawn at Federation. However, the effect of ss 38 and 39 of the Judiciary Act was to render inoperative the conferral by State Parliaments of concurrent State authority over matters in federal jurisdiction to bodies other than State courts. There is a very significant practical difference between the conclusion I reach on this basis and the same conclusion reached on the basis of a constitutional implication. If the pre-Federation, colonial legislative power to confer jurisdiction on non-court tribunals in diversity, admiralty and maritime matters had been impliedly withdrawn by a constitutional implication, then it would require a referendum, under s 128 of the Constitution, for that legislative power to be returned to the States. The conclusion that this power, in significant use at Federation, had been impliedly withdrawn subject only to change by a referendum is not supported by the express or implied meaning of the constitutional text, read in its historical context and in light of its purpose. Nor is it required or justified by any decision or assumption since Federation. In contrast, the best construction of s 77(ii), having regard to its historical context and purpose and that of Ch III generally, supports a conclusion that leaves the power with the Commonwealth Parliament to exclude (as it did), or not to exclude, the exercise by a State of its concurrent legislative power in relation to its courts and tribunals. As Leeming JA said in the Court of Appeal, that construction "left it open to the Commonwealth Parliament to have a High Court with original jurisdiction confined to s 75 matters and otherwise not to exercise the powers to create federal courts or to invest federal jurisdiction in State courts"329 or to exclude any concurrent State jurisdiction. The appeals should be dismissed and orders made as proposed in the joint judgment of Kiefel CJ, Bell and Keane JJ. 327 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 106 [181]-[183]; [2013] HCA 7. 328 Leeson v General Council of Medical Education and Registration (1889) 43 Ch D 366 at 379, 386; R v London County Council; Ex parte Akkersdyk; Ex parte Fermenia [1892] 1 QB 190 at 195; Royal Aquarium and Summer and Winter Garden Society v Parkinson [1892] 1 QB 431 at 452; Sweeney v Fitzhardinge (1906) 4 CLR 716 at 737; [1906] HCA 73; Goldsmith v Sands (1907) 4 CLR 1648 at 1658; [1907] HCA 47. 329 Burns v Corbett (2017) 343 ALR 690 at 706 [63].
HIGH COURT OF AUSTRALIA APPELLANT AND GOOGLE LLC RESPONDENT [2018] HCA 25 13 June 2018 ORDER Pursuant to r 42.07.1 of the High Court Rules 2004 (Cth) Google LLC is made the respondent to this appeal in substitution for Google Inc. Appeal allowed. Set aside orders 2 to 6 of the Court of Appeal of the Supreme Court of Victoria made on 20 December 2016 and, in their place, order that the appeal be dismissed with costs. The respondent pay the appellant's costs of the appeal to this Court. On appeal from the Supreme Court of Victoria Representation G O'L Reynolds SC with P A Heywood-Smith QC and D P Hume for the appellant (instructed by George Liberogiannis & Associates) N J Young QC with L G De Ferrari SC for the respondent (instructed by Ashurst Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Defamation – Publication – Capacity to defame – Where application for summary dismissal of defamation proceeding – Where allegedly defamatory matter includes search results of internet search engine – Where allegedly defamatory matter includes autocomplete predictions of internet search engine – Whether respondent published allegedly defamatory matter – Whether matter capable of conveying allegedly defamatory imputations – Whether proceeding had no real prospect of success. Words and phrases – "autocomplete", "capacity to defame", "composite publication", "defamation", "defamatory image", "no real prospect of success", "ordinary reasonable person", "publication", "search engine", "search results", "search terms", "summary dismissal", "summary judgment". Civil Procedure Act 2010 (Vic), ss 62, 63. Supreme Court (General Civil Procedure) Rules 2005 (Vic), rr 7.01, 8.09. KIEFEL CJ, BELL, KEANE, NETTLE AND GORDON JJ. This is an appeal from a judgment of the Court of Appeal of the Supreme Court of Victoria (Ashley, Ferguson and McLeish JJA)1, on appeal from an order of the primary judge (McDonald J)2. McDonald J ordered that an application by the respondent, Google Inc (now Google LLC ("Google")), to set aside a defamation proceeding brought by the appellant, Mr Trkulja, against Google, and its service out of the jurisdiction on Google, be dismissed. McDonald J rejected Google's contention that the proceeding has no real prospect of success3. In allowing the appeal, the Court of Appeal held, to the contrary, that the proceeding has no real prospect of success4. For the reasons which follow, McDonald J was correct to refuse to set aside the proceeding and, therefore, the appeal to this Court should be allowed. Mr Trkulja's claim Mr Trkulja's holograph amended statement of claim ("the Amended Statement of Claim") is not an elegant pleading. It is, however, sufficiently comprehensible to convey that Mr Trkulja alleges that Google defamed him by publishing images which convey imputations that he "is a hardened and serious criminal in Melbourne", in the same league as figures such as "convicted murderer" Carl Williams, "underworld killer" Andrew "Benji" Veniamin, "notorious murderer" Tony Mokbel and "Mafia Boss" Mario Rocco Condello; an associate of Veniamin, Williams and Mokbel; and "such a significant figure in the Melbourne criminal underworld that events involving him are recorded on a website that chronicles crime in [the] Melbourne criminal underworld". The pleading alleges that Google published the defamatory images between 1 December 2012 and 3 March 2014 to persons in Victoria, including several named persons, upon those persons accessing the Google website, searching for Mr Trkulja's name or alias (Michael Trkulja and Milorad Trkulja), and then viewing and perceiving the images presented on-screen in response to the search. 1 Google Inc v Trkulja (2016) 342 ALR 504. 2 Trkulja v Google Inc [2015] VSC 635. 3 Trkulja v Google Inc [2015] VSC 635 at [77]. 4 Google Inc v Trkulja (2016) 342 ALR 504 at 506 [5], 507 [9]. Bell Nettle Gordon The pleading particularises the allegedly defamatory matters as comprising two groups: "the Google Images matter" and "the Google Web matter" (reproductions of which are set out in the Amended Statement of Claim and in Annexures A and B, respectively, to the judgments of the primary judge and the Court of Appeal)5. The Google Images matter ("the images matter") consists of 20 pages which are individually described in the pleading. Pages one to 13 and 15 to 20 are described as Google images search results pages that display images of Mr Trkulja mixed with images of convicted Melbourne criminals. Those pages variously contain one of the following phrases: "melbourne criminals", "melbourne criminal underworld figure", "melbourne criminal underworld photos", "melbourne underworld crime", "melbourne underworld crime photos", "melbourne underworld criminals", "melbourne underworld killings" and "melbourne underworld photos". The pleading draws attention to a particular feature of the images matter, which is that some of the pages include an image that contains text stating, inter alia, "Google lawsuit in court", "COLOURFUL Melbourne identity Michael Trkulja" and "Mr Trkulja an associate of Mick Gatto". Page 14 of the images matter is described in the pleading as a Google "autocomplete" search results page. It shows a Google search for "michael trk" together with autocomplete predictions, namely, phrases including "michael trkulja", "michael trkulja criminal", "michael trkulja melbourne crime", "michael trkulja underworld" and "michael trkulja melbourne underworld crime". In addition, although it is not described as such in the pleading, the page contains an image referring to a "[w]ebsite for this image", stating that "[i]n a nutshell, Michael Trkulja's beef with both Yahoo and Google was that …" and other references to a defamation lawyer and an online solicitor. The Google Web matter ("the web matter") consists of seven individual pages. Page one is not described in the pleading but it shows what appears to be an online post by "Picklesworth" that says: 5 The order of the pages in the Google Images matter and the Google Web matter differs between the Amended Statement of Claim and Annexures A and B of the judgments of the courts below (the Court of Appeal labelled Annexures A and B as Annexures 1 and 2 respectively). This judgment will refer to the order of the pages as they appear in the judgments of the primary judge and the Court of Appeal. Bell Nettle Gordon "I hear Milorad 'Michael' Trkulja is a former hitman who shot a music promoter in the balaclava. 'Streisand'd". Underneath that statement is an image of what appears to be predictions generated by Google's autocomplete functionality showing the phrases "michael trkulja", "michael trkulja criminal", "michael trkulja melbourne crime" and Page two of the web matter is not precisely described in the pleading but appears to be a web search results page for the search words "melbourne- criminal-underworld-figure", and which displays both text results and image results. Pages three and four of the web matter are described in the pleading as web search results pages for the search words "melbourne criminal underworld photos" and "melbourne underworld criminals", and which display both text results and image results. The pleading draws attention to the fact that pages three and four display images of Mr Trkulja mixed with images of convicted Melbourne criminals. Pages five to seven of the web matter are described in the pleading as Google autocomplete search results pages. The substantive content of page five of the web matter resembles that of page 14 of the images matter, albeit page five does not have the additional images that are displayed in the latter. On page six, a Google search for the words "michael trkulj" is displayed together with autocomplete predictions, namely, the phrases "michael trkulja", "michael trkulja v google", "michael trkulja shot", "michael trkulja lawyer", "michael trkulja tony mokbel", "michael trkulja melbourne underworld crime" and "michael trkulja google". Similarly, on page seven, a Google search for the words "milorad trkulj" is displayed in combination with autocomplete predictions, namely, the phrases "milorad trkulja", "milorad trkulja criminal", "milorad trkulja shooting", "milorad trkulja google", "milorad trkulja lawyer", "milorad trkulja email", "milorad trkulja tony mokbel", "milorad trkulja wiki", "milorad trkulja yahoo" and "milorad trkulja melbourne". The pleading avers that the images matter and the web matter are defamatory of Mr Trkulja in their natural and ordinary meaning and, further, that they carry the following defamatory imputations: "(a) The plaintiff is a hardened and serious criminal in Melbourne[;] Bell Nettle Gordon The plaintiff is a hardened and serious criminal in Melbourne in the same league as convicted murderer Carl Williams, hardened notorious underworld killer Andrew 'Benji' Veniamin, hardened and serious and notorious murderer Tony Mokbel and the Mafia Boss Mario Rocco Condello[;] The plaintiff is an associate of underworld killer Andrew 'Benji' Veniamin[;] [(d)] The plaintiff is an associate of Carl Williams Melbourne notorious convicted criminal murderer and drug trafficker; The plaintiff is an associate of Tony Mokbel, the Australian notorious convicted murderer and drug supplier and trafficker; The plaintiff is such a significant figure in the Melbourne criminal underworld that events involving him are recorded on a website that chronicles crime in [the] Melbourne criminal underworld[.]" In the alternative it is contended that the images matter is defamatory in its true innuendo for carrying substantially the same imputations, and also that the gist of the images matter and the web matter is to associate Mr Trkulja with organised criminal activity in Melbourne. The pleading then alleges that on or about 3 December 2012 Mr Trkulja sent a letter each to Google and Google Australia Pty Ltd ("Google Australia") (which at one time was the second defendant to the proceedings) by registered post drawing the allegedly defamatory matter to their attention, informing them of the nature of the defamatory matter, demanding that Google and Google Australia remove the images matter from their computers and servers, or to remove all links or direction from their computers and servers linking or directing internet users to the matter, requesting them to provide details including contact details of the source or sources of the matter, and demanding that they "block the name of Milorad Trkulja and Michael Trkulja from [their] computers and servers links or directing internet users to the name of 'Milorad Trkulja' and On 14 December 2012, Google Australia responded to the effect that the "search products" to which Mr Trkulja's "inquiry" related were owned by Google and that Google Australia was "unable to further assist" him with his inquiry. Then, on 18 December 2012, Google sent an email to Mr Trkulja to the effect that Google Australia had forwarded Mr Trkulja's letter to Google; that the Bell Nettle Gordon "Google services" referred to in the letter were owned and operated by Google, to which all future correspondence relating thereto should be directed; and that Google was currently reviewing the complaint and would contact Mr Trkulja when it had completed its review. Mr Trkulja replied on the following day via email and on 20 December 2012 received a reply in the same terms as that sent by Google on 18 December 2012. Google provided a detailed response to Mr Trkulja on 16 January 2013. In substance, Google stated that it had removed certain websites from its web search results pages and, without admission, that it had blocked certain autocomplete predictions and search queries relating to Mr Trkulja from appearing as part of the autocomplete and search functions of "google.com.au". Google declined, however, to remove the images of Mr Trkulja which appeared in response to other image searches made using the Google search engine. The prayer for relief is for damages, including aggravated and punitive damages on the basis of Google's knowledge of the falsity of the imputations, at least from 3 December 2012, and its refusal to accept any responsibility for the allegedly defamatory publications, and also for an injunction against Google in the following terms: "that [Google] permanently block Google Images and web searchers [sic] of the Plaintiff's names 'Milorad Trkulja' and 'Michael Trkulja' from its computers and servers and remove all links from its computers and servers linking to the Google webs and images users from Australia." Relevant statutory provisions At relevant times and so far as is germane for present purposes, r 7.01 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic) provided for service of originating process out of Australia, without order of the court, where the proceeding is founded on a tort committed within Victoria (r 7.01(1)(i)) or the proceeding is brought in respect of damage suffered wholly or partly in Victoria and caused by a tortious act or omission wherever occurring (r 7.01(1)(j)). The writ in this proceeding was served out of Australia on Google in the United States of America pursuant to r 7.01(1)(i) and (j). At relevant times, r 8.09 provided in substance that a defendant could apply before entering an appearance, whether conditional or unconditional, to set aside a writ or its service. Section 63 of the Civil Procedure Act 2010 (Vic) provides in substance that a court may give summary judgment in favour of a defendant on the Bell Nettle Gordon defendant's application, if satisfied that the plaintiff's claim or part of that claim "has no real prospect of success". In Agar v Hyde6, this Court essayed the test for determination of an application to set aside service of a proceeding out of Australia, pursuant to Pt 10 r 6A of the Supreme Court Rules 1970 (NSW), on the ground that the claims made in the proceeding had insufficient prospects of success to warrant putting an overseas defendant to the time, expense and trouble of defending them. The plurality concluded that the test should be the same as the test for summary judgment propounded in Dey v Victorian Railways Commissioners7 and General Steel Industries Inc v Commissioner for Railways (NSW)8: a party should not be denied the opportunity of placing his or her case before the court in the ordinary way, with the advantage of the usual interlocutory processes, unless there is a high degree of certainty about what would be the ultimate outcome of the proceeding if allowed to go to trial in the ordinary way. Subsequently, in Spencer v The Commonwealth9, this Court considered whether the test for summary judgment prescribed by s 31A of the Federal Court of Australia Act 1976 (Cth), namely, that the court is satisfied that the other party has "no reasonable prospect of successfully prosecuting the proceeding or … part of [it]", differs from the test espoused in Dey and General Steel. All members of the Court except Heydon J emphasised that the power to dismiss an action summarily should not be exercised lightly10 but Hayne, Crennan, Kiefel and Bell JJ added that the evident legislative purpose revealed by the text of s 31A would be defeated if its application were read as confined to cases of a kind falling within the test in Dey and General Steel11. (2000) 201 CLR 552 at 575-576 [56]-[60] per Gaudron, McHugh, Gummow and Hayne JJ; [2000] HCA 41. (1949) 78 CLR 62 at 90-91 per Dixon J; [1949] HCA 1. (1964) 112 CLR 125 at 130 per Barwick CJ; [1964] HCA 69. (2010) 241 CLR 118; [2010] HCA 28. 10 (2010) 241 CLR 118 at 131 [24] per French CJ and Gummow J, 141 [60] per Hayne, Crennan, Kiefel and Bell JJ. 11 (2010) 241 CLR 118 at 140 [56], 141 [60]. Bell Nettle Gordon In Victoria, the test for summary judgment is prescribed by s 62 of the Civil Procedure Act: whether the plaintiff's claim has "no real prospect of success". Consistently with Spencer, the view taken in Victoria is that the power to dismiss an action summarily is not lightly to be exercised but that, like the test applicable to s 31A of the Federal Court of Australia Act, the "no real prospect of success" test is to some degree more liberal than Dey and General Steel. It permits of the possibility of cases in which, although the plaintiff's case is not "hopeless" or "bound to fail", it does not have a real prospect of succeeding12. The proceeding at first instance Before McDonald J, Google put its application for summary dismissal on three bases: (i) that it did not publish the images matter or the web matter; (ii) that the matters in issue were not defamatory of Mr Trkulja; and (iii) that Google was entitled to immunity from suit13. Based on a careful consideration of the present state of authority, including the decisions of Beach J in Trkulja v Google (No 5)14 (against which there was no appeal), and of Blue J in Duffy v Google Inc15, McDonald J concluded that it was strongly arguable that Google's intentional participation in the communication of the allegedly defamatory search results relating to Mr Trkulja to users of the Google search engine supported a finding that Google published the allegedly defamatory results16. McDonald J also rejected Google's contention that a Google search engine user or a person looking over his or her shoulder would not think less of a person such as Mr Trkulja because his photograph is included in the search results or because his photograph or references to his name appear in "snippets" and 12 Lysaght Building Solutions Pty Ltd (t/as Highline Commercial Construction) v Blanalko Pty Ltd (2013) 42 VR 27 at 39 [29] per Warren CJ and Nettle JA (Neave JA agreeing at 40 [36]); Bodycorp Repairers Pty Ltd v Holding Redlich [2018] VSCA 17 at [127]-[129]. 13 Trkulja v Google Inc [2015] VSC 635 at [2]. 14 [2012] VSC 533. 15 (2015) 125 SASR 437. 16 Trkulja v Google Inc [2015] VSC 635 at [67]. Bell Nettle Gordon hyperlinks returned by web searches and autocomplete predictions. His Honour illustrated the point by reference to a compilation of images of Mr Trkulja among images of convicted criminals Judith Moran, Matthew Johnson and Tony Mokbel, which appeared at page four of the web matter as reproduced in Annexure B, and concluded that it was certainly arguable that a reasonable search engine user would look at the compilation and assume that Mr Trkulja was a convicted criminal17. McDonald J further rejected Google's contention that Google should be held immune from suit as a matter of public interest, observing, correctly, that the range and extent of the defences provided for in Div 2 of Pt 4 of the Defamation Act 2005 (Vic) militate heavily against the development of a common law search engine proprietor immunity18. The proceeding before the Court of Appeal Before the Court of Appeal, Google advanced essentially the same three grounds. The Court of Appeal found it unnecessary to decide the first ground and rejected the third19. But the Court of Appeal upheld the second ground, ruling in relation to the images matter that Mr Trkulja "would have no prospect at all of establishing that the images matter conveyed any of the defamatory imputations relied upon"20, and, in relation to the web matter, that Mr Trkulja "could not possibly succeed in showing that the web matter upon which he relies carried any of the pleaded defamatory imputations"21. For the reasons which follow, the Court of Appeal were wrong so to hold. 17 Trkulja v Google Inc [2015] VSC 635 at [69]-[71]. 18 Trkulja v Google Inc [2015] VSC 635 at [76]. 19 Google Inc v Trkulja (2016) 342 ALR 504 at 593 [372], 601 [413]. 20 Google Inc v Trkulja (2016) 342 ALR 504 at 597 [391]. 21 Google Inc v Trkulja (2016) 342 ALR 504 at 598 [396]. Bell Nettle Gordon Assessing capacity to defame The question of whether words or images complained of are capable of conveying a pleaded defamatory imputation is a question of law22 which permits of only one correct answer. It is, however, a question about which reasonable minds may sometimes differ, and, consequently, it is only ever with great caution that a defamation pleading should be disallowed as incapable of bearing a defamatory imputation. The potential for difference about the capacity of matters to convey different meanings is an equally strong reason for declining to set aside a proceeding on the basis that an impugned publication is incapable of bearing the defamatory imputation alleged23. And it is to be remembered that on an application for summary dismissal such as this, the plaintiff's case as to the capacity of the publications to defame is to be taken at its highest24. The test for whether a published matter is capable of being defamatory is what ordinary reasonable people would understand by the matter complained of25. In making that assessment, it is necessary to bear in mind that ordinary men and women have different temperaments and outlooks, degrees of education and life experience. As Lord Reid observed in Lewis v Daily Telegraph Ltd26, "[s]ome are unusually suspicious and some are unusually naive". So also are some unusually well educated and sophisticated while others are deprived of the 22 Jones v Skelton [1963] 1 WLR 1362 at 1370; [1963] 3 All ER 952 at 958; Favell v Queensland Newspapers Pty Ltd (2005) 79 ALJR 1716 at 1719 [9] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 189-190; [2005] HCA 52. 23 Favell (2005) 79 ALJR 1716 at 1719 [6] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 189; Corby v Allen & Unwin Pty Ltd (2014) Aust Torts Reports ¶82-184 at 67,716-67,717 [134]-[137] per McColl JA (Bathurst CJ and Gleeson JA agreeing at 67,697 [1], 67,725 [191]). 24 See for example D'Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1 at 75 [230] per Kirby J; [2005] HCA 12; Pi v Pierce [2015] NSWCA 118 at [24] per Ward JA (Gleeson JA agreeing at [31]); cf Abou-Lokmeh v Harbour Radio Pty Ltd [2016] NSWCA 228 at [28] per McColl JA in relation to contextual imputations. 25 Jones v Skelton [1963] 1 WLR 1362 at 1370; [1963] 3 All ER 952 at 958; Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460 at 466-467 [4]-[6] per French CJ, Gummow, Kiefel and Bell JJ; [2009] HCA 16. 26 [1964] AC 234 at 259 (Lord Jenkins agreeing at 262). Bell Nettle Gordon benefits of those advantages. The exercise is, therefore, one of attempting to envisage a mean or midpoint of temperaments and abilities and on that basis to decide the most damaging meaning27 that ordinary reasonable people at the midpoint could put on the impugned words or images considering the publication as a whole28. As the Court of Appeal of England and Wales observed in Berezovsky v Forbes Inc29, that exercise is one in generosity not parsimony. The question is not what the allegedly defamatory words or images in fact say or depict but what a jury could reasonably think they convey to the ordinary reasonable person30; and it is often a matter of first impression. The ordinary reasonable person is not a lawyer who examines the impugned publication over-zealously but someone who views the publication casually and is prone to a degree of loose thinking31. He or she may be taken to "read between the lines in the light of his general knowledge and experience of worldly affairs"32, but such a person also draws implications much more lawyer, especially derogatory implications33, and takes into account emphasis given by conspicuous headlines than a freely 27 Cf John Fairfax Publications Pty Ltd v Rivkin (2003) 77 ALJR 1657 at 1661-1662 [26] per McHugh J; 201 ALR 77 at 83; [2003] HCA 50. 28 Lewis [1964] AC 234 at 259 per Lord Reid (Lord Jenkins agreeing at 262); Favell (2005) 79 ALJR 1716 at 1721 [17] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 192. 29 [2001] EMLR 45 at 1040 [16]. 30 Favell (2005) 79 ALJR 1716 at 1721 [17] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 192. 31 Morgan v Odhams Press Ltd [1971] 1 WLR 1239 at 1245 per Lord Reid; [1971] 2 All ER 1156 at 1162-1163. 32 Lewis [1964] AC 234 at 258 per Lord Reid; Favell (2005) 79 ALJR 1716 at 1719-1720 [10] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 33 Lewis [1964] AC 234 at 277 per Lord Devlin; Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 573-574 [134] per Kirby J; [1998] HCA 37; Favell (2005) 79 ALJR 1716 at 1720 [11] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 190. Bell Nettle Gordon or captions34. Hence, as Kirby J observed in Chakravarti v Advertiser Newspapers Ltd35, "[w]here words have been used which are imprecise, ambiguous or loose, a very wide latitude will be ascribed to the ordinary person to draw imputations adverse to the subject". The Court of Appeal approached the matter on the basis that Mr Trkulja's claim is a composite claim wherein all of the search results comprised in the images matter (Annexure A) are to be looked at as one single composite publication, all of the search results comprised in the web matter (Annexure B) are to be looked at as another single composite publication, and, in determining whether any of the searches comprised in Annexure A is capable of conveying the allegedly defamatory imputations, the ordinary reasonable search engine user is to be attributed with knowledge of the contents of all of the searches comprising Annexure A and Annexure B, and vice versa. As appears from the Amended Statement of Claim, that is not the way in which the case is pleaded. The Amended Statement of Claim conveys that each search and the result which appeared in response to it are to be considered together but separately from each other separate search and response, for the reason that each search may have been conducted by a different person without engaging in any of the other searches. That accords with the view expressed by Callinan J in Dow Jones & Co Inc v Gutnick36 that each hit on a website is a separate publication. Before this Court, counsel for Mr Trkulja did not seek to make anything of the point. He appeared to accept that it was open to aggregate all of the search results in Annexure A and all of the search results in Annexure B, although not A and B, but, if the matter goes to trial, the difference could prove significant. 34 Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 646 per Aickin J; [1979] HCA 3; Rivkin (2003) 77 ALJR 1657 at 1661-1662 [26] per McHugh J, 1699 [187] per Callinan J; 201 ALR 77 at 83, 130; Favell (2005) 79 ALJR 1716 at 1719 [8] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 189. 35 (1998) 193 CLR 519 at 574 [134]. 36 (2002) 210 CLR 575 at 652-653 [197]-[199]; [2002] HCA 56. See also The Buddhist Society of Western Australia Inc v Bristile Ltd [2000] WASCA 210 at [10] per Anderson and Owen JJ, [48] per Wheeler J. Bell Nettle Gordon Be that as it may, it is evident for the reasons given by McDonald J that at least some of the search results complained of had the capacity to convey to an ordinary reasonable person viewing the search results that Mr Trkulja was somehow opprobriously associated with the Melbourne criminal underworld, and, therefore, that the search results had the capacity to convey one or more of the defamatory imputations alleged. Whether or not the search results are viewed individually or as a composite does not affect that conclusion. As will be explained, the Court of Appeal's reasoning to the contrary must be rejected. The Court of Appeal's reasoning The Court of Appeal's judgment is of extraordinary length and complexity for the resolution of an appeal against dismissal of a summary disposition application in which the only real question was the capacity of the published matters to defame. It ranges across a broad tract of the law of defamation extending to a substantial, proleptic analysis of the juridical basis of primary and secondary publication in relation to computer search engine proprietors, of the application of innocent publication defences to computer search engine proprietors, and of how and why, in view of the social utility of computer search engines, the existing law of defamation might better be shaped to relate to search engine proprietors or relieve them from liability. Problematically, it also effectively treats the judgment of Beach J in Trkulja v Google (No 5)37 as if it were plainly wrong38 (despite the fact that Google did not appeal against that judgment and that it has been considered with implicit approval in another common law jurisdiction39), and, in relation to the question of capacity of the autocomplete predictions to defame, treats40 the observations of Blue J in Duffy41 as if they went to capacity to defame, notwithstanding that Blue J was describing the process of reasoning by which his Honour, sitting as trial judge, reached 37 [2012] VSC 533. 38 Google Inc v Trkulja (2016) 342 ALR 504 at 589-590 [344]-[348]. 39 Dr Yeung Sau Shing Albert v Google Inc [2014] 4 HKLRD 493 at 534-536 [103]-[106]. See also Oriental Press Group Ltd v Fevaworks Solutions Ltd (2013) 16 HKCFAR 366. 40 Google Inc v Trkulja (2016) 342 ALR 504 at 597 [393]. 41 (2015) 125 SASR 437 at 527 [375]. Bell Nettle Gordon findings of mixed fact and law in the trial of a defamation proceeding before judge alone. The Court of Appeal's judgment is also replete with direct and indirect references to Google's affidavit evidence regarding the "world wide web", search engines, and the systems and processes by which Google claims that its computer search engine results are generated; and, despite the summary nature of the application and, therefore, the impracticability of affording Mr Trkulja access to an opportunity for meaningful cross-examination of Google deponents, ordinary interlocutory processes and tendering opposing evidence42, the judgment includes a range of purportedly definitive findings of mixed fact and law drawn from Google's affidavit evidence adverse to Mr Trkulja43. (i) Publication McDonald J was correct to hold that it is strongly arguable that Google's intentional participation in the communication of the allegedly defamatory results to Google search engine users supports a finding that Google published the allegedly defamatory results44. Properly advised, that was all that the Court of Appeal needed to say on the subject. Instead, although the Court of Appeal did not decide the appeal on the question of publication, their Honours made a purportedly determinative finding of mixed fact and law45 that a search engine 42 See Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 358 [52]-[53], 359 [56] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [1999] HCA 9. 43 Google Inc v Trkulja (2016) 342 ALR 504 at 585-586 [320], 587 [332], 590 44 See and compare Trkulja v Google (No 5) [2012] VSC 533 at [18]-[19], [27]-[31]; A v Google New Zealand Ltd [2012] NZHC 2352 at [67]-[75]; Oriental Press Group (2013) 16 HKCFAR 366 at 387-388 [50]-[54] per Ribeiro PJ (Ma CJ, Chan PJ, Litton NPJ and Gleeson NPJ agreeing at 373 [1], [2], 409 [123], 410-411 [127], 412 [133]); Dr Yeung Sau Shing Albert [2014] 4 HKLRD 493 at 534-536 45 See Byrne v Deane [1937] 1 KB 818 at 837 per Greene LJ; Beitzel v Crabb [1992] 2 VR 121 at 128; Trkulja v Google (No 5) [2012] VSC 533 at [18]; Kenyon v Sabatino [2013] WASC 76 at [13]. See also Bass (1999) 198 CLR 334 at 358 [52]-[53] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. Bell Nettle Gordon like Google, proprietor, including of autocomplete predictions, but that an innocent dissemination defence will almost always, if not always, be maintainable in a period before notification of an is a publisher of search results, That was not an appropriate way to proceed. In point of principle, the law as to publication is tolerably clear47. It is the application of it to the particular facts of the case which tends to be difficult, especially in the relatively novel context of internet search engine results. And contrary to the Court of Appeal's approach, there can be no certainty as to the nature and extent of Google's involvement in the compilation and publication of its search engine results until after discovery. There are only the untested assertions of Google deponents. Furthermore, until and unless Google files a defence it cannot be known what defences will be taken (whatever Google might now say is its intention regarding the defences on which it will rely). Nor does it profit to conjecture what defences might be taken and whether, if taken, they would be likely to succeed. For whatever defences are taken, they will involve questions of mixed fact and law and, to the extent that they involve questions of fact, they will be matters for the jury48. Given the nature of this proceeding, there should have been no thought of summary determination of issues relating to publication or possible defences, at least until after discovery, and possibly at all49. 46 Google Inc v Trkulja (2016) 342 ALR 504 at 590 [349], 591-592 [353], [357]. 47 See Webb v Bloch (1928) 41 CLR 331 at 363-364 per Isaacs J; [1928] HCA 50. In relation to the publication of hearsay, see Truth (NZ) Ltd v Holloway [1960] 1 WLR 997 at 1002-1003; Wake v John Fairfax & Sons Ltd [1973] 1 NSWLR 43 at 49-50; Rivkin (2003) 77 ALJR 1657 at 1662 [27] per McHugh J; 201 ALR 77 at 83; John Fairfax Publications Pty Ltd v Obeid (2005) 64 NSWLR 485 at 503-505 [90]-[96] per McColl JA (Sheller JA and McClellan AJA agreeing at 487 [1], 512 48 See for example Jones v Skelton [1963] 1 WLR 1362 at 1378; [1963] 3 All ER 952 at 964; Bellino v Australian Broadcasting Corporation (1996) 185 CLR 183 at 198, 200 per Brennan CJ, 214 per Dawson, McHugh and Gummow JJ, 238 per Gaudron J; [1996] HCA 47. 49 See Wickstead v Browne (1992) 30 NSWLR 1 at 5-6 per Kirby P; affirmed on appeal Wickstead v Browne (1993) 10 Leg Rep SL2. Bell Nettle Gordon The Court of Appeal were also incorrect to say50 that it was incumbent on Mr Trkulja to plead that Google is a primary or secondary publisher of the allegedly defamatory matters. It is not the practice to plead the degree of participation in the publication of defamatory matters51, for the reason that all degrees of participation in the publication are publication. As Isaacs J held in "The term published is the proper and technical term to be used in the case of libel, without reference to the precise degree in which the defendant has been instrumental to such publication; since, if he has intentionally lent his assistance to its existence for the purpose of being published, his instrumentality is evidence to show a publication by him." If Google wishes to invoke the defence afforded to "subordinate distributors" by s 32 of the Defamation Act or otherwise contend that the degree of its participation in the publication of the impugned search results was such that it should not be held liable, it is for Google to plead and prove the relevant facts. (ii) Capacity to defame The Court of Appeal's process of reasoning as to the capacity of the impugned web searches to defame Mr Trkulja proceeded from dual premises that whether "any of the defamatory imputations which are pleaded [are] arguably conveyed" is to be determined by reference to the understanding of "an ordinary reasonable user of a search engine such as the Google search engine, without which the facility to navigate the trillions of pages on the world wide web would be gravely compromised", and having regard to the "entirety of the matter relied upon"53. 50 Google Inc v Trkulja (2016) 342 ALR 504 at 557 [225]. 51 See Mullis et al (eds), Gatley on Libel and Slander, 12th ed (2013) at 984-986 [26.5], 1398-1408 [A1.6]-[A1.11]; Blair et al (eds), Bullen & Leake & Jacob's Precedents of Pleadings, 17th ed (2012), vol 1 at 634 [37-08]; Tobin and Sexton (eds), Australian Defamation Law and Practice, looseleaf, service 72, vol 1 52 (1928) 41 CLR 331 at 363-364 quoting Folkard, The Law of Slander and Libel, 5th ed (1891) at 439 (second and third emphasis added by Isaacs J). 53 Google Inc v Trkulja (2016) 342 ALR 504 at 597 [388]-[390]. Bell Nettle Gordon Their Honours next identified the impugned matter as being, in the case of the images matter, "the composite of the search terms and the images compiled in response" and, in the case of the web matter, "the composite of the search terms and the results which the Google search engine produced"54, with the result that all of the search results comprised in the images matter (reproduced in Annexure A) were to be looked at as one single composite publication and all of the search results comprised in the web matter (reproduced in Annexure B) were to be looked at as another single publication, upon the basis that the ordinary reasonable search engine user was to be attributed with knowledge of the contents of all of the search results comprising Annexures A and B55. The third step in the Court of Appeal's process of reasoning was that the allegedly defamatory material was to be viewed in a context which comprised the world wide web; the particular search engine website; the ability of any internet user to access that website using a web browser to input search terms; and the form of the search engine's response to the terms inputted by the user, because, according to the Court of Appeal, "there would scarcely be an internet user in Australia (or in the 189 countries where the Google search engine is used) who would not recognise that context"56. The fourth step was to reason that, because of the extreme speed with which search engine results are generated, and the number of search results produced, any user of a search engine would know of the enormous scale of the search which has been made and that it could not possibly be made manually57. Thus, according to the Court of Appeal, any user who inputted the words "melbourne criminal underworld photos" and received in response a compilation of images such as the allegedly defamatory search results appearing on page four of Annexure A, which included some images of known criminals, some images of the late Marlon Brando (in his role as "the Godfather"), a tram, actors (presumably in a film about serious crime) and a solicitor, or, on another occasion, results including images such as those appearing on page one of Annexure A of a former Victorian Chief Commissioner of Police, a murder victim, a crime reporter and a Google logo, "would inevitably give thought to just 54 Google Inc v Trkulja (2016) 342 ALR 504 at 510 [30], 536 [145]. 55 Google Inc v Trkulja (2016) 342 ALR 504 at 596-597 [387]-[388]. 56 Google Inc v Trkulja (2016) 342 ALR 504 at 537 [147] (footnote omitted). 57 Google Inc v Trkulja (2016) 342 ALR 504 at 537 [150]. Bell Nettle Gordon what relationship there could possibly be between the words inputted and the compilation produced, and very probably perceive a disconnect between the images and the search terms" and would "recognise ... that the search results in their entirety did not reflect the meaning of the inputted words considered as a phrase"58. The Court of Appeal also relied, in part, on observations of this Court in Google Inc v Australian Competition and Consumer Commission ("Google v ACCC")59 as support for the Court of Appeal's findings as to the knowledge to be attributed to the ordinary reasonable user of a search engine60. From that, it was said to follow that, considered by reference to the understanding of an ordinary reasonable user of a search engine, and, in particular, the Google search engine61: "the plaintiff would have no prospect at all of establishing that the images matter conveyed any of the defamatory imputations relied upon. … It might be said, if a contrary conclusion was to be reached, that the list of persons potentially defamed would be both large and diverse. We do not accept that such a conclusion would be sound." Likewise, in relation to page 14 of Annexure A, which contained an image of autocomplete predictions, an image referring to a "[w]ebsite for this image" and stating that "[i]n a nutshell, Michael Trkulja's beef with both Yahoo and Google was that …", and advertisements for a defamation lawyer and an online solicitor, the Court of Appeal held that the content was incapable of being defamatory. Their Honours found on the basis of Google's affidavit evidence that autocomplete predictions which are returned in respect of particular search terms entered by search engine users are strongly influenced by the particular user's previous searches. In the Court of Appeal's view, it was also "crystal clear" that the image of the webpage related to Mr Trkulja's earlier successful defamation proceedings. Viewing page 14 in the context of the whole of 58 Google Inc v Trkulja (2016) 342 ALR 504 at 537 [151]. 59 (2013) 249 CLR 435; [2013] HCA 1. 60 Google Inc v Trkulja (2016) 342 ALR 504 at 541-543 [175]-[179]. 61 Google Inc v Trkulja (2016) 342 ALR 504 at 597 [391]. Bell Nettle Gordon Annexure A, it could not be considered capable of carrying any of the pleaded imputations62. As to the web matter, the Court of Appeal referred first to pages five to seven of Annexure B, which also contained autocomplete predictions, and relied on its earlier conclusion that the autocomplete predictions were incapable of being defamatory63. Their Honours concluded that page one of Annexure B was essentially of the same character as pages five to seven of Annexure B and, further, that the apparent reference to Mr Trkulja being "Streisand'd" indicated that64: "The whole point of this page is that the plaintiff's successful defamation proceeding had produced the Streisand effect. Far from carrying any of the defamatory imputations pleaded by the plaintiff, the commentator was pointing out that the plaintiff's successful defamation proceedings – in which he had been awarded damages in respect of an imputation that he was somehow connected with the Melbourne underworld – had not brought matters to an end." The Court of Appeal thereafter referred to page two of Annexure B, in which, according to the Court of Appeal, the only reference to Mr Trkulja was in connection with his earlier successful defamation proceeding against Google, under the heading "Google defamation case and 'publishing' in the digital age – Crikey". That led their Honours to observe65: "How that could possibly be said to be defamatory of the plaintiff we do not understand. The fact that the reference to the plaintiff's earlier successful defamation proceeding was on a results page which adverted to the television series, 'Underbelly', which contained thumbnails of persons associated with the Melbourne underworld (none of which were the plaintiff) and which referred to a reputed criminal named Arico, could not possibly deflect attention from the import of the only reference to the plaintiff." 62 Google Inc v Trkulja (2016) 342 ALR 504 at 597-598 [393]-[395]. 63 Google Inc v Trkulja (2016) 342 ALR 504 at 598 [397]. 64 Google Inc v Trkulja (2016) 342 ALR 504 at 598 [398]. 65 Google Inc v Trkulja (2016) 342 ALR 504 at 598 [399]. Bell Nettle Gordon Finally, the Court of Appeal referred to page four of Annexure B, which, as mentioned, was the page in respect of which McDonald J drew the conclusion that it was certainly arguable that a reasonable search engine user would look at the compilation of images and assume that Mr Trkulja was a convicted criminal. The Court of Appeal took the entirely opposite view66: "It may be regarded as the high water mark of the material relied upon by the plaintiff, because of the fact that the return of images included the plaintiff and three criminals. Pausing, and underlining the random nature of the images displayed, the four images in the particular sequence are the first four images from the left on the top line of page five of Annexure A The heading under which the thumbnails on page four appear is 'Images for Melbourne underworld criminals – report images'. It is a similar heading to that which appears above the compilations of images on pages two and three of Annexure B. A reasonable user of the internet, aware of the unpredictable results which are generated by an image search – well exemplified by the 20 pages of Annexure A – would immediately apprehend, in our opinion, that the thumbnails on page four of Annexure B were of no different character. They could not convey the defamatory imputations pleaded by the plaintiff. But there is a further matter. … It is scarcely conceivable that assumed secondary publication prior to [notice being given to Google on or about 3 December 2012] would not attract a successful innocent dissemination defence. But according to the plaintiff's particularised case, it is impossible to say whether page four of Annexure B (and the same is the situation with page five of Annexure A) was published after the giving of notice." Those conclusions are unacceptable. As has been observed, the test of capacity of a published matter to defame is, in this case, whether any of the search results complained of are capable of conveying any of the defamatory imputations alleged. It is not, as the Court of Appeal stated67, whether "any of the defamatory imputations which are pleaded [are] arguably conveyed". To express the test as the Court of Appeal did runs the risk (which appears to have 66 Google Inc v Trkulja (2016) 342 ALR 504 at 599 [401]-[403]. 67 Google Inc v Trkulja (2016) 342 ALR 504 at 597 [389]. Bell Nettle Gordon eventuated) of judging the issue according to what the court may think the allegedly defamatory words or images say or depict rather than what a jury could reasonably think they convey. Further, although it might be correct to say that the capacity of the search results to convey the alleged defamatory imputations is to be judged by reference to the "ordinary reasonable user of a search engine such as the Google search engine"68, by analogy, say, to the way it is said that the capacity of a newspaper article to defame is to be judged by reference to the standards of an ordinary reasonable reader69, to do so would be correct only so long as the expression were understood to mean an ordinary reasonable person who has made the Google search in issue. No doubt, as the Court of Appeal said, it can be assumed that the ordinary reasonable person who has used the Google search engine to make a search contemplates that the results of his or her search bear some connection to the search terms. But in the absence of tested, accepted evidence to the contrary, it must also be allowed that the ability to navigate the Google search engine, and the extent of comprehension of how and what it produces, whence it derives, and how and to what degree Google contributes to its content, may vary significantly among the range of persons taken to be representative of the hypothetical ordinary reasonable person. Additionally, the question of law of whether the standard of knowledge and comprehension of the processes involved should be taken as some hypothetical midpoint in the range of understanding is yet to be authoritatively determined. It may well be that the answer will turn on evidence as to the standards of knowledge and comprehension among users of the Google search engine (be they first-time or experienced participants, and recognising that the two classes may require separate consideration for the purposes of the law of defamation70), and on inferences to be drawn from that kind of evidence as to the 68 Google Inc v Trkulja (2016) 342 ALR 504 at 597 [390]. 69 Favell (2005) 79 ALJR 1716 at 1718-1719 [5] per Gleeson CJ, McHugh, Gummow and Heydon JJ, cf at 1722-1723 [23]-[26] per Kirby J; 221 ALR 186 at 188, cf at 70 See Capital and Counties Bank v Henty (1882) 7 App Cas 741 at 744-745 per Lord Selborne LC, 771 per Lord Blackburn and Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 at 165-167 per Hunt CJ at CL (Mason P (Footnote continues on next page) Bell Nettle Gordon implications, particularly derogatory implications, that a user with that degree of knowledge and comprehension would likely attribute to the results of a Google search of the kinds in issue. As Kirby P (as his Honour then was) observed in another context, in Wickstead v Browne71, appellate courts should be loath to consider the application of the law to evidence in novel contexts without the benefit of the evidence having been adduced and a trial concluded. Testimony "gives colour and content to the application and development of legal principle"72, and out of the detail of the evidence ultimately proved may arise an insight which aids understanding whether and how principle should be developed. The Court of Appeal were further in error in treating the decision of this Court in Google v ACCC as supportive of the conclusion that, although an image of Mr Trkulja may have appeared in responses to Google searches which included the words "criminal", "melbourne" and "underworld", that was simply because those terms appeared in a webpage which contained that image, and for that reason were not capable of conveying to the ordinary reasonable user of a search engine the imputation that Mr Trkulja was a criminal or part of the Melbourne criminal underworld73. The question in Google v ACCC was whether Google had engaged in misleading and deceptive conduct contrary to s 52 of the Trade Practices Act 1974 (Cth) by displaying misleading and deceptive "sponsored links". At first instance, it was held that Google had not done so because it was simply a conduit which passed on the sponsored links without any adoption or approval of their contents74. On appeal, the Full Court of the Federal Court of Australia held75 that and Handley JA agreeing at 161), which suggest that the circumstances of publication, specifically the mode or manner of publication, are relevant to the characteristics of the ordinary reasonable person. 71 (1992) 30 NSWLR 1 at 5-6. 72 (1992) 30 NSWLR 1 at 5 per Kirby P. 73 Google Inc v Trkulja (2016) 342 ALR 504 at 541-543 [175]-[178]. 74 Australian Competition and Consumer Commission v Trading Post Australia Pty Ltd (2011) 197 FCR 498 at 536-540 [176]-[185]. 75 Australian Competition and Consumer Commission v Google Inc (2012) 201 FCR Bell Nettle Gordon Google had engaged in misleading and deceptive conduct by displaying sponsored links because the sponsored links were "Google's response to a user's insertion of a search term into Google's search engine", which meant that Google did not merely pass on the contents of the sponsored links without adoption or approval in the sense essayed in Yorke v Lucas76. On appeal to this Court that holding was reversed. It was considered to be axiomatic that the Google search mechanism operates according to search terms chosen by the user for the purpose of generating "organic search results". According to the primary judge's findings of fact, which were not impugned, Google was not the maker, author, creator or originator of the information in any of the sponsored links. Given evidence adduced at first instance, it was held that the primary judge was right to find, as he had, that ordinary and reasonable users of the Google search engine would have understood that the sponsored links were advertisements which Google did not endorse but was merely passing on for what they were worth. The reason for that being so was that77: "[o]n its face, each sponsored link indicates that its source is not Google, but an advertiser. The heading 'Sponsored Links' appears above both top left sponsored links and right side sponsored links, and the URL of the advertiser, appearing within each sponsored link, clearly indicates its source. Ordinary and reasonable users of the Google search engine would have understood that the sponsored links were created by advertisers. Such users would also have understood that representations made by the sponsored links were those of the advertisers, and were not adopted or endorsed by Google." By contrast, this case is not concerned with sponsored links or misleading and deceptive conduct in relation to the content of sponsored links, but rather with the law of defamation in relation to responses to Google searches of another kind. There is no evidence here, on the basis of which it is possible to be persuaded to the level of satisfaction necessary for the summary disposition of the proceeding on the ground of lack of capacity to defame, that it would have been apparent to an ordinary reasonable person using the Google search engine 76 (1985) 158 CLR 661 at 666 per Mason ACJ, Wilson, Deane and Dawson JJ; [1985] HCA 65. 77 Google v ACCC (2013) 249 CLR 435 at 460 [70] per French CJ, Crennan and Bell Nettle Gordon that Google made no contribution to the elements or combination of elements of those of the search results that convey a connection between Mr Trkulja and criminality. And in contradistinction to the "sponsored links" in Google v ACCC, there is not here the indication axiomatically implicit in a third party advertisement that the author of the advertisement is the advertiser. Just as importantly, to say that a user of the Google search engine would "inevitably give thought to just what relationship there could possibly be between the words inputted and the compilation produced" or "very probably perceive a disconnect between the images and the search terms" (emphasis added)78 does not gainsay that it would be open to a jury to conclude on the balance of probabilities that an ordinary reasonable person using the Google search engine would perceive the compilation to convey one or more of the defamatory imputations alleged. To the contrary, it is to be assumed that such a person would contemplate that there is a connection between the terms of the search inputted into the search engine and the contents of the results displayed. Ex hypothesi, since he or she has conducted the search for criminals and members of the Melbourne criminal underworld, he or she would rationally suppose that there is something in the response which correlates to criminals and members of the Melbourne criminal underworld. And prima facie the most obvious, logical connection between the terms of the search and the response is that those persons whose images or names appear in the response, under headings such as "melbourne criminal underworld photos", "melbourne underworld crime" and "melbourne underworld killings", or at least some of them, are criminals or members of the Melbourne criminal underworld. It is true, as the Court of Appeal observed79, that in some of the search results comprising Annexures A and B, some of the persons shown are plainly not criminals or members of the Melbourne criminal underworld. A former Victorian Chief Commissioner of Police, the late Marlon Brando in his role as "the Godfather", criminal law barristers and solicitors and other persons who are not criminals but whose professions have something to do with crime are obvious examples. But in each of the pages on which images of such persons appear, there are also images of persons who are notorious criminals or members of the Melbourne criminal underworld coupled with images of persons, such as Mr Trkulja, whose identity is relatively unknown. Depending upon the totality 78 Google Inc v Trkulja (2016) 342 ALR 504 at 537 [151]. 79 Google Inc v Trkulja (2016) 342 ALR 504 at 537 [151]. Bell Nettle Gordon of the evidence adduced at trial, it would be open to a jury to conclude that an ordinary reasonable person using the Google search engine would infer80 that the persons pictured whose identities are unknown are persons, like the notorious criminals with whom they are pictured, in some fashion opprobriously connected with criminality and the Melbourne criminal underworld. So to conclude, as the Court of Appeal observed, might result in the list of persons potentially defamed being large and diverse. But contrary to the Court of Appeal's apparent reasoning, that does not mean that the conclusion is unsound. It means no more than that, in such cases, the liability of a search engine proprietor, like Google, may well turn more on whether the search engine proprietor is able to bring itself within the defence of innocent dissemination than on whether the content of what has been published has the capacity to defame. The Court of Appeal further erred, in relation to the autocomplete predictions which appear on page 14 of Annexure A and pages five to seven of Annexure B, in adopting the findings of mixed fact and law made by Blue J sitting at trial as judge alone in Duffy in relation to the autocomplete publications in that case as a basis for concluding that the autocomplete predictions in this case were incapable of conveying the imputations alleged. Contrary, too, to the Court of Appeal's reasoning81, the apparent references in Annexure B to previous defamation proceedings involving Mr Trkulja do not significantly if at all detract from the conclusion that the impugned searches are capable of conveying the defamatory imputations alleged. On page one of Annexure B, there appear the words "Milorad 'Michael' Trkulja is a former hitman who shot a music promoter in the balaclava" followed by the word "Streisand'd". Ex facie, those words are capable of imputing some criminality on the part of Mr Trkulja. The Court of Appeal reasoned by reference to a meaning of "Streisand'd" which their Honours appear to have derived from Wikipedia that "Streisand'd" implied a reference to Mr Trkulja's earlier successful defamation proceeding against Google82. But that is not an inference that was open to be drawn. It had 80 Cf Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 at 301 per Mason J (Gibbs CJ, Wilson J and Brennan J agreeing at 295, 303); [1982] HCA 50; Marsden (1998) 43 NSWLR 158 at 167 per Hunt CJ at CL (Mason P and Handley JA agreeing at 161). 81 Google Inc v Trkulja (2016) 342 ALR 504 at 598 [394], [398]-[399]. 82 Google Inc v Trkulja (2016) 342 ALR 504 at 511 [35]. Bell Nettle Gordon not been suggested that the meaning of "Streisand'd" was notorious or would be known to an ordinary reasonable person viewing the search results83; and the fact that the word may have appeared in Wikipedia is in itself irrelevant. The capacity of a published matter to defame must be assessed by reference to the most damaging meaning that could reasonably be put upon the words in question84. Moreover, even if the use of "Streisand'd" could be regarded as suggesting some sort of connection between Mr Trkulja and a defamation proceeding (which, as the matter stands, is a dubious proposition), that would not bar the capacity of the words "Milorad 'Michael' Trkulja is a former hitman who shot a music promoter in the balaclava" to defame Mr Trkulja. Admittedly, there appears on page two of Annexure B a "snippet" of a webpage relating to a Google defamation case which mentions Mr Trkulja's name and a connection to the "criminal underworld", and, on page three, a "snippet" of a webpage which, under the heading "Trkulja v Yahoo! – Defamation Watch", refers to a "music promoter" winning "225000" followed by the words "To the right of the article was a large photo of Trkulja and then an article … the plaintiff is such a significant figure in the Melbourne criminal underworld that events …". Possibly, the latter suggests that Mr Trkulja succeeded in a defamation action against Yahoo and was awarded $225,000. But, even if that be so, it does not necessarily detract from the sting of the words that the plaintiff in that action, namely, Mr Trkulja, was a "significant figure in the Melbourne criminal underworld". It also remains that the search results reproduced at pages two and three were the result of searches for the words "melbourne criminal underworld figure" and "melbourne criminal underworld photos", which of itself would be capable of conveying to the ordinary reasonable person using the Google search engine that there is some opprobrious connection between those terms and Mr Trkulja. And lastly, given that the "snippets" provide little by way of detail as to the defamatory imputations which were the subject of the previous proceedings, or as to the falsity or otherwise of Mr Trkulja's alleged criminal connection, it might 83 See generally Lewis [1964] AC 234 at 264 per Lord Morris of Borth-y-Gest, 278 per Lord Devlin; Jones v Skelton [1963] 1 WLR 1362 at 1370-1371; [1963] 3 All ER 952 at 958; Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 641 per Mason and Jacobs JJ. 84 Lewis [1964] AC 234 at 259 per Lord Reid; Favell (2005) 79 ALJR 1716 at 1721 [17] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 192. Bell Nettle Gordon be thought that there is little about the "snippets" that a jury would necessarily regard as significantly ameliorative. This observation applies equally to the material appearing on page 14 of Annexure A which the Court of Appeal held was a reference to Mr Trkulja's earlier defamation proceedings that undermined the capacity of the publication to convey the pleaded imputations. Conclusion and orders The Court of Appeal erred in concluding that the matters upon which Mr Trkulja relied were incapable of conveying any of the defamatory imputations which were pleaded and therefore erred in concluding that Mr Trkulja's proceeding had no real prospect of success. It follows that the appeal should be allowed. Pursuant to r 42.07.1 of the High Court Rules 2004 (Cth) Google LLC is made the respondent to this appeal in substitution for Google Inc and the appeal is determined as so constituted. Orders two to six of the Court of Appeal should be set aside and in their place it should be ordered that the appeal to the Court of Appeal be dismissed with costs. Google should pay the costs of the appeal to this Court.
HIGH COURT OF AUSTRALIA LEO AKIBA ON BEHALF OF THE TORRES STRAIT REGIONAL SEAS CLAIM GROUP APPELLANT AND COMMONWEALTH OF AUSTRALIA & ORS RESPONDENTS Akiba on behalf of the Torres Strait Regional Seas Claim Group v Commonwealth of Australia [2013] HCA 33 7 August 2013 ORDER Appeal allowed in part. Set aside paragraph 1 of the order of the Full Court of the Federal Court of Australia made on 14 March 2012 and, in its place, order that the appeal to that Court is dismissed. The first and second respondents pay the appellant's costs of the appeal to this Court. Appeal otherwise dismissed. On appeal from the Federal Court of Australia Representation B W Walker SC with R W Blowes SC, T P Keely and S A Hamilton for the appellant (instructed by Torres Strait Regional Authority) J T Gleeson SC, Acting Solicitor-General of the Commonwealth with R J Webb QC and N Kidson for the first respondent (instructed by Australian Government Solicitor) M A Perry QC with H P Bowskill for the second respondent (instructed by Crown Solicitor (Qld)) P L Gore for the third to thirty-first, thirty-third, forty-third and forty-fifth to forty-seventh respondents (instructed by Gore & Associates) Submitting appearances for the thirty-second and thirty-fourth respondents No appearance for the thirty-fifth to forty-second, forty-fourth, forty-eighth and forty-ninth respondents Intervener G R Donaldson SC, Solicitor-General for the State of Western Australia for the Attorney-General for the State of Western Australia, intervening (instructed by State Solicitor (WA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Akiba on behalf of the Torres Strait Regional Seas Claim Group v Commonwealth of Australia Native title – Native title rights in relation to waters – Determination made in relation to waters in Torres Strait – Determination included native title right to access and take for any purpose resources in native title areas – Successive Commonwealth and Queensland legislative regimes prohibited taking fish and other aquatic life for commercial purposes without licence – Whether legislative regimes inconsistent with continued existence of native title right – Whether right to access and take resources in native title areas partially extinguished where resources taken for commercial purposes. Native title – Native title rights in relation to waters – Certain reciprocal access and use rights recognised in Islander society – Reciprocal rights arose out of personal relationships – Whether reciprocal rights "native title rights and interests" within meaning of s 223(1) of Native Title Act 1993 (Cth). Words and phrases – "extinguishment", "inconsistent with the continued existence of a native title right", "native title rights and interests", "reciprocal rights". Native Title Act 1993 (Cth), ss 10, 11, 211, 223, 225-227, 238. FRENCH CJ AND CRENNAN J. Introduction On 2 July 2010, a Judge of the Federal Court of Australia (Finn J) delivered reasons for judgment in an application made on behalf of 13 island communities in the Torres Strait for a determination of native title over a large part of the waters of the Strait1. His Honour made final orders on 23 August 2010 which took the form of a native title determination over the waters ("the Determination"). The Determination defined "group rights" comprising the native title held by each of the communities. The native title rights and interests, set out in Order 5 of the Determination, included2: "the right to access resources and to take for any purpose resources in the native title areas." The native title right so framed could be exercised in a variety of ways, including by taking fish for commercial or trading purposes. Like each of the native title rights and interests set out in the Determination, it was not exclusive. That is to say, it did not confer rights on the native title holders to the exclusion of others, nor any right to control the conduct of others3. It was a right to be exercised in accordance with the traditional laws and customs of the native title holders, the laws of the State of Queensland and the Commonwealth of Australia and the common law4. On 14 March 2012, the Full Court of the Federal Court, by majority (Keane CJ and Dowsett J, Mansfield J dissenting), allowed an appeal against the decision of the primary judge5. The majority held that successive fisheries legislation enacted by colonial and State legislatures in Queensland and by the Commonwealth Parliament had extinguished any right to take fish and other aquatic life for commercial purposes. The Full Court varied Order 5(b) of the Determination by adding after it the words6: 1 Akiba v Queensland (No 3) (2010) 204 FCR 1. 2 Determination, Order 5(b). 3 Determination, Order 7. 4 Determination, Order 8. 5 The Commonwealth v Akiba (2012) 204 FCR 260. (2012) 204 FCR 260 at 308 [145]. Crennan "This right does not, however, extend to taking fish and other aquatic life for sale or trade." The Full Court dismissed a cross-appeal by the appellant against a finding by the primary judge that reciprocity-based rights and interests subsisting between members of Torres Strait Island communities did not constitute native title rights and interests within the meaning of s 223 of the Native Title Act 1993 (Cth) ("the NT Act"). On 5 October 2012, this Court (French CJ, Crennan and Kiefel JJ) granted the appellant special leave to appeal against the decision of the Full Court7. The appeal should be allowed in relation to the extinguishment issue. The appeal should be dismissed in relation to the reciprocal rights issue. The issues The grant of special leave was limited to the following grounds set out in the notice of appeal: the majority of the Full Court erred in holding that notwithstanding the overall purpose of the Commonwealth and Queensland fisheries legislation is the regulation of taking certain fish and other aquatic resources for commercial purposes, a native title right to engage in such taking is extinguished by a specific provision of such legislation which prohibits all taking of such resources for commercial purposes save pursuant to a licence granted under the legislation; the majority of the Full Court erred in holding that the native title right to take fish and other aquatic life for trade or sale is extinguished in all or any part of the native title area by applicable Queensland and Commonwealth fisheries legislation; the Full Court erred in holding that rights held under traditional laws and customs on the basis of a 'reciprocal relationship' with a holder of 'occupation based rights' are not native title rights or interests within the meaning of s 223(1) of the Native Title Act 1993 (Cth)." The first two grounds assume the existence, under the traditional laws and customs of the group represented by the appellant, of a native title right to take fish and other aquatic life for trade or sale. That assumption was examined in the [2012] HCATrans 245. Crennan course of argument against the alternative proposition that the taking of such marine resources for a commercial purpose was no more than a particular mode of enjoyment of the right "to take for any purpose resources in the native title areas." For the reasons that follow it should be treated as such. The Determination of native title by the primary judge did not include a native title right of the kind found by the Full Court to have been extinguished. The appeal should be allowed on the first two grounds in the notice of appeal. The third ground raised the question whether intramural reciprocal relationships between members of different island communities give rise to obligations relating to access to and use of resources which are "rights and interests ... in relation to land or waters" within the meaning of s 223 of the NT Act. The answer to that question is in the negative. Before considering these issues and the way they were dealt with at first instance and in the Full Court, it is necessary to refer first to the definition of "native title rights and interests" in s 223 of the NT Act and also to the Determination made by the primary judge. Definition of "native title rights and interests" Section 223 of the NT Act relevantly provides: "Native title Common law rights and interests The expression native title or native title rights and interests means the communal, group or individual rights and interests of Aboriginal peoples or Torres Strait Islanders in relation to land or waters, where: the rights and interests are possessed under the traditional laws acknowledged, and the traditional customs observed, by the Aboriginal peoples or Torres Strait Islanders; and the Aboriginal peoples or Torres Strait Islanders, by those laws and customs, have a connection with the land or waters; and the rights and interests are recognised by the common law of Australia. Crennan Hunting, gathering and fishing covered (2) Without limiting subsection (1), rights and interests in that subsection includes hunting, gathering, or fishing, rights and interests."8 Section 223 defines the rights and interests which can be the subject of a determination of native title made under s 225 of the NT Act. They include usufructuary rights of the kind set out in s 223(2). It is a necessary condition of their inclusion in a determination that the rights and interests are recognised by the common law of Australia. That condition flows from s 223(1)(c). "Recognise" in this context means that the common law "will, by the ordinary processes of law and equity, give remedies in support of the relevant rights and interests to those who hold them"9. Extinguishment is the obverse of recognition. It does not mean that native title rights and interests are extinguished for the purposes of the traditional laws acknowledged and customs observed by the native title holders. By way of example apposite to this case, the plurality pointed out in Yanner v Eaton10 that to tell a group of Aboriginal people that they may not hunt or fish without a permit11: "does not sever their connection with the land concerned and does not deny the continued exercise of the rights and interests that Aboriginal law and custom recognises them as possessing." "Extinguishment" means that the native title rights and interests cease to be recognised by the common law and thereupon cease to be native title rights and 8 Subsections (3), (3A) and (4), which are not material for present purposes, provide for certain statutory rights and interests to be treated as native title rights and interests, and exclude statutory access rights for native title claimants and rights and interests created by reservations or conditions in pastoral leases granted before 1 January 1994. 9 The Commonwealth v Yarmirr (2001) 208 CLR 1 at 49 [42] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; [2001] HCA 56. 10 (1999) 201 CLR 351; [1999] HCA 53. 11 (1999) 201 CLR 351 at 373 [38] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. Crennan interests within the meaning of s 223 of the NT Act. As six Justices of this Court said in Fejo v Northern Territory12: "The underlying existence of the traditional laws and customs is a necessary pre-requisite for native title but their existence is not a sufficient basis for recognising native title." (emphasis in original) In this appeal "extinguishment" is said, by the respondents, to result from statutory regimes affecting the exercise of a broadly stated native title right in a way that is not consistent with the recognition of an incident or lesser right comprised within that broadly stated native title right. The Determination To answer the description of a "determination of native title" under the NT Act, the Determination made by the primary judge had to comply with the requirements of s 225, which provides: "A determination of native title is a determination whether or not native title exists in relation to a particular area (the determination area) of land or waters and, if it does exist, a determination of: (a) who the persons, or each group of persons, holding the common or group rights comprising the native title are; and the nature and extent of the native title rights and interests in relation to the determination area; and the nature and extent of any other interests in relation to the determination area; and the relationship between the rights and interests in paragraphs (b) and (c) (taking into account the effect of this Act); and to the extent that the land or waters in the determination area are not covered by a non-exclusive agricultural lease or a non-exclusive pastoral lease—whether the native title rights and interests confer possession, occupation, use and enjoyment of that land or waters on the native title holders to the exclusion of all others." 12 (1998) 195 CLR 96 at 128 [46] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [1998] HCA 58. Crennan A note to the section stated that the determination may deal with the matters in pars (c) and (d) by referring to a particular kind or particular kinds of non-native title interests. The specifications of the waters constituting the determination area, waters excluded from it, and parts of the determination area in which native title was held to exist and parts in which it was held not to exist were set out in Orders 1 to 3 of the Determination made by the primary judge, read with Scheds 1 to 4. Order 3 provided: "Native title exists in those parts of the determination area described in Schedule 4 (native title areas)." Schedule 4 provided: "The parts of the determination area where the native title exists are those parts other than the parts described in Schedule 3 and comprise the areas which are the marine territories of each island community identified in Order 4 and described in Schedule 5(2) which are owned by the respective community or are shared with one or more other island community or communities." Order 4(1) provided: "The group rights comprising the native title are held by the members of each of the following island communities in respect of the native title areas described in Schedule 4". There followed the names of 13 islands in the determination area. The names of the persons whose descendants were "[t]he native title holders ... in aggregate" referred to in Order 4(2) were listed in Sched 5(1). Separate lists in Sched 5(2) set out the names of persons from whom the members of each of the relevant island communities were descended. The native title rights and interests were defined in Order 5 of the Determination as: the rights to access, to remain in and to use the native title areas; and subject to orders 6 and 9, the right to access resources and to take for any purpose resources in the native title areas." Orders 6 and 9 concerned the non-application of the Determination to, and the non-existence of native title rights and interests in, minerals and petroleum resources. They are not material for present purposes. Order 7 provided that the Crennan native title rights and interests did not confer possession, occupation, use and enjoyment of the native title areas or any parts of them on the native title holders to the exclusion of all others, nor any right to control the conduct of others. Order 8 provided in standard form: "The native title rights and interests are subject to and exercisable in accordance with the: traditional laws and customs of the native title holders; and laws of the State of Queensland and the Commonwealth of Australia including the common law." Order 10, read with Sched 6, set out the nature and extent of the other interests in relation to the native title areas. The relationship between the native title rights and interests and those other interests was defined in Order 11 as follows: the other interests co-exist with the native title rights and interests; the determination does not affect the validity of those other interests; to the extent of any inconsistency, the native title rights and interests yield to the other interests referred to in Schedule 6." So far as they existed, the other interests set out in Sched 6 included the following: The international right of innocent passage through the territorial sea. Any subsisting public right to fish. The public right to navigate. The rights and interests of holders of licences, permits, authorities, resource allocations or endorsements issued under the Fisheries Act 1994 (Q), the Fisheries Regulation 2008 (Q), the Torres Strait Fisheries Act 1984 (Cth) and the Fisheries Management Act 1991 (Cth), or any other legislative scheme for the control, management and exploitation of the living resources within the determination area. Other rights and interests under various licences, certificates and permits or otherwise granted by the Crown or conferred by statute, rights of access under statutory authority, and rights and interests held by the State or the Commonwealth. Crennan Rights and interests of the Australian Maritime Safety Authority as the owner and manager of aids to navigation in various defined locations and under certain sub-leases, and, subject to the laws of Australia, the customary rights of citizens of Papua New Guinea who live in the Protected Zone or the adjacent coastal area of Papua New Guinea. Extinguishment and fisheries legislation in the Federal Court The effects of colonial, State and Commonwealth fisheries legislation on the native title right "to take for any purpose resources in the native title areas" were considered by the primary judge and the Full Court. That consideration involved a review of historical and contemporary statutes. It is not necessary for present purposes to repeat that review in detail. The succession of relevant statutes was set out in the judgment at first instance and extracted from that judgment at some length in the majority judgment of the Full Court13. It is sufficient to say that the history of the relevant colonial and State legislation dates back to the Queensland Fisheries Act 1877 (Q)14. The history of the relevant Commonwealth legislation began with the Fisheries Act 1952 (Cth) and the Pearl Fisheries Act 1952 (Cth)15. It was not in dispute that between them the relevant statutes applied to all of the waters in the determination area. The common feature of the legislation, which was invoked by the Commonwealth and by the State of Queensland in favour of their extinguishment submissions, was the imposition of a prohibition against any person taking fish and other aquatic life for commercial purposes without a licence granted under the relevant statute16. It was that feature which the parties debated in this Court. No contention was advanced before the primary judge that: 13 (2012) 204 FCR 260 at 275–279 [42], 280–283 [44]–[45]. 14 The sequence of relevant colonial and State legislation includes: Queensland Fisheries Act 1877 (Q); Pearl-shell and Bêche-de-mer Fishery Act 1881 (Q); Oyster Act 1886 (Q); Queensland Fisheries Act 1887 (Q); Fish and Oyster Act 1914 (Q); Fisheries Act 1957 (Q). 15 The sequence of relevant Commonwealth legislation is: Fisheries Act 1952 (Cth); Pearl Fisheries Act 1952 (Cth); Continental Shelf (Living Natural Resources) Act 1968 (Cth); Torres Strait Fisheries Act 1984 (Cth); Fisheries Management Act 1991 (Cth). 16 (2012) 204 FCR 260 at 288 [70]. Crennan native title had been extinguished in any part of the determination area by leases or licences given under Queensland statutes attaching exclusive rights to such grants; the right to fish for particular species or a number of species for commercial purposes had been legislatively extinguished and replaced by rights granted pursuant to, or in connection with, statutory management plans17. The State of Queensland submitted to the primary judge that its successive legislative regimes since 1877 had abrogated or extinguished any pre-existing native title rights to fish for commercial purposes and replaced them with rights conferred only upon those who held the necessary statutory licences. The legislative history was said to have resulted in the extinguishment of any rights to take or use the resources of the claim area for trading or commercial fishing purposes18. The Commonwealth submission, reflecting that of the State, pointed to a history of increasingly comprehensive management regimes and the retention by the Crown exclusively for itself and its agencies of the capacity to manage the seas, including those in the claim area. Fisheries management had focused upon commercial fishing, reflecting the treatment of fisheries in the sea as a public resource and concerns about the long-term development and sustainability of the fishing industry19. The appellant submitted before the primary judge that the relevant native title right was the right to access and take marine resources and not a differentiated right to take resources for trade or commercial purposes. Neither the State nor the Commonwealth argued that the native title right to take marine resources had itself been extinguished. The appellant submitted that the effect of the successive regulatory schemes was to regulate the exercise of native title rights and not to extinguish them or their incidents20. There was nothing to suggest, and no party suggested, that native title holders had ever been precluded 17 (2012) 204 FCR 260 at 316 [194]. 18 (2010) 204 FCR 1 at 201 [803]. 19 (2010) 204 FCR 1 at 208–209 [840]–[841]. 20 (2010) 204 FCR 1 at 209 [842]. Crennan from applying for licences to fish for commercial purposes under the successive regimes or are now precluded from doing so21. In a key passage in his reasons for judgment on the extinguishment issue, his Honour said22: "The native title right I have found is a right to access and take marine resources as such — a right not circumscribed by the use to be made of the resource taken." His Honour nevertheless accepted that an activity carried on in exercising a native title right might be treated as a distinct "incident" of the right for extinguishment purposes when the activity had a discrete and understood purpose. It was in that context that his Honour rejected the appellant's submission that it was impermissible to subdivide the general right to take resources. He said23: "The distinction between engaging in an activity for commercial purposes or for non-commercial, private or other purposes is one commonly made. It was from the outset, and remains, a characteristic of the fisheries legislation considered in this matter. It is reflected in the differentiation of purposes in s 211 of the NT Act." A broadly defined native title right such as the right "to take for any purpose resources in the native title areas" may be exercised for commercial or non-commercial purposes. The purposes may be well defined or diffuse. One use may advance more than one purpose. But none of those propositions requires a sectioning of the native title right into lesser rights or "incidents" defined by the various purposes for which it might be exercised. The lesser rights would be as numerous as the purposes that could be imagined. A native title right or interest defines a relationship between the native title holders and the land or waters to which the right or interest relates. The right is one thing; the exercise of it for a particular purpose is another. That proposition does not exclude the possibility that a native title right or interest arising under a particular set of traditional laws and customs might be defined by reference to its exercise for a limited purpose24. That is not this case. The right defined by Order 5(b) of 21 (2010) 204 FCR 1 at 210 [844]. 22 (2010) 204 FCR 1 at 211 [847]. 23 (2010) 204 FCR 1 at 211 [847]. 24 An analogous right at common law is the easement: see Gray, Elements of Land Law, (1987) at 633–634. Crennan the Determination, which, save for the extinguishment question, was not in dispute, was a right "to take for any purpose resources in the native title areas." His Honour treated the exercise for commercial purposes of the group right to take resources in the native title areas as though it were the exercise of a right to take marine resources for commercial purposes. That equivalence attracted the application of principles governing the extinguishment of native title. On that basis, the question of construction, as his Honour posed it, was whether successive Queensland and Commonwealth legislative regimes had disclosed a clear and plain intention to extinguish that right25. His Honour held that they had not26: "the legislative regimes of the State since 1877, and of the Commonwealth since 1952, concerning fisheries did not, and do not, severally or together evince a clear and plain intention to extinguish native title rights to take fish for commercial purposes. To the extent that those legislative regimes regulate the manner in which, and the conditions subject to which, commercial fishing can be conducted in a fishery in the native title holders' marine estate, or prohibits qualifiedly or absolutely particular activities in relation to commercial fishing in the fishery in that estate: cf s 211 of the NT Act; the native title holders must, in enjoying their native title rights, observe the law of the land. This is their obligations as Australian citizens. But complying with those regimes provides them with the opportunity — qualified it may be — to exercise their native title rights." The majority in the Full Court, in a similar vein, focused upon "the effect of successive licensing regimes whereby, in simple terms, fishing for commercial purposes without a licence issued by the government of Queensland or the Commonwealth was prohibited."27 Their Honours concluded that it was sufficient to establish extinguishment of a native title right to take fish for commercial purposes that the Fish and Oyster Act 1914 (Q) and the Fisheries Act 1952 (Cth) prohibited that activity without licences granted under those respective statutes28. Central to their Honours' reasoning was the proposition that 25 (2010) 204 FCR 1 at 212 [850]. 26 (2010) 204 FCR 1 at 215 [861]. 27 (2012) 204 FCR 260 at 273 [37]. The relevant State Acts were in force before the Racial Discrimination Act 1975 (Cth) and before the NT Act. No question of their invalidity for inconsistency with a Commonwealth law arose. 28 (2012) 204 FCR 260 at 288 [70]. Crennan the prohibition could not be characterised as mere regulation of fishing in the native title area. Consideration of the Full Court's judgment directs attention to the distinction between rights and their exercise for particular purposes, and to the concepts of "extinguishment" and "native title right" and their interaction. Those matters are inter-related and, to the extent that they involve the concept of extinguishment as an effect of legislative action, a question of statutory construction is raised. Rights, extinguishment and statutory construction "Extinguishment" in relation to native title refers to extinguishment or cessation of rights29. Such extinguishment of rights in whole or in part is not a logical consequence of a legislative constraint upon their exercise for a particular purpose, unless the legislation, properly construed, has that effect. To that proposition may be added the general principle that a statute ought not to be construed as extinguishing common law property rights unless no other construction is reasonably open. Neither logic nor construction in this case required a conclusion that the conditional prohibitions imposed by successive fisheries legislation in the determination area were directed to the existence of a common law native title right to access and take marine resources for commercial purposes. In any event, nothing in the character of a conditional prohibition on taking fish for commercial purposes requires that it be construed as extinguishing such a right. Recognition of the distinction between a broadly stated right and its exercise in particular ways or for particular purposes is implicit in the legislative scheme of the NT Act dealing with extinguishment. The NT Act contemplates the existence of legislative or executive acts which "affect" native title rights and interests by constraint or restriction but do not extinguish them. Section 227 provides: "An act affects native title if it extinguishes the native title rights and interests or if it is otherwise wholly or partly inconsistent with their continued existence, enjoyment or exercise." 29 Wik Peoples v Queensland (1996) 187 CLR 1 at 185 per Gummow J; [1996] HCA 40; Fejo v Northern Territory (1998) 195 CLR 96 at 126 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; Western Australia v Ward (2002) 213 CLR 1 at 89 [78], 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; [2002] HCA 28. Crennan The term "act" there includes the making, amendment or repeal of any legislation30 and includes legislation which is partly inconsistent with the continued enjoyment or exercise of native title rights and interests. The plurality in Western Australia v Ward31 adverted to "the distinction between the extinguishment of native title rights and interests and partial inconsistency" in the NT Act which was continued by the amendments to that Act in 199832. That distinction, which is made in s 227, is also brought out in s 238, which "sets out the effect of a reference to the non-extinguishment principle applying to an act."33 The non-extinguishment principle is applied to various classes of "act" by the NT Act. If an "act" to which it applies affects any native title in relation to the land or waters concerned, then "the native title is nevertheless not extinguished, either wholly or partly."34 Section 238(4) provides: "If the act is partly inconsistent with the continued existence, enjoyment or exercise of the native title rights and interests, the native title continues to exist in its entirety, but the rights and interests have no effect in relation to the act to the extent of the inconsistency." The "non-extinguishment" principle is a statutory construct. It is nevertheless underpinned by a logical proposition of general application: that a particular use of a native title right can be restricted or prohibited by legislation without that right or interest itself being extinguished. The distinction between the existence and exercise of a right appears in s 211 of the NT Act. Because the section was mentioned by the primary judge and in submissions, it is desirable to set out the relevant parts of it: "Requirements for removal of prohibition etc on native title holders Subsection (2) applies if: 30 NT Act, s 226. 31 (2002) 213 CLR 1. 32 (2002) 213 CLR 1 at 69 [27] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 33 NT Act, s 238(1). 34 NT Act, s 238(2). Crennan the exercise or enjoyment of native title rights and interests in relation to land or waters consists of or includes carrying on a particular class of activity (defined in subsection (3)); and a law of the Commonwealth, a State or a Territory prohibits or restricts persons from carrying on the class of activity other than in accordance with a licence, permit or other instrument granted or issued to them under the law; and Removal of prohibition etc on native title holders If this subsection applies, the law does not prohibit or restrict the native title holders from carrying on the class of activity, or from gaining access to the land or waters for the purpose of carrying on the class of activity, where they do so: Note: for the purpose of satisfying their personal, domestic or non- commercial communal needs; and in exercise or enjoyment of their native title rights and interests. In carrying on the class of activity, or gaining the access, the native title holders are subject to laws of general application. Definition of class of activity Each of the following is a separate class of activity: hunting; fishing; gathering; a cultural or spiritual activity; any other kind of activity prescribed for the purpose of this paragraph." Crennan The distinction between native title rights and their exercise is made explicit in s 211 and was noted by the plurality in Yanner v Eaton. Their Honours said that35: "the section necessarily assumes that a conditional prohibition of the kind described [in s 211(1)(b)] does not affect the existence of the native title rights and interests in relation to which the activity is pursued." There is a tension between that observation and an element of the reasoning in Western Australia v The Commonwealth (Native Title Act Case)36 in which the plurality Justices appeared to equate each broadly stated "class of activity" described in s 211(3) with a usufructuary right or interest, being an incident of a more broadly stated native title37. That will be so in many, if not most, cases. Whether it is a proposition that emerges from the construction of s 211 was not a question whose resolution formed any part of the reasoning which led their Honours to hold that s 211 was a valid exercise of Commonwealth power38. The existence of the distinction between the exercise of a native title right for a particular purpose or in a particular way, and the subsistence of that right, is relevant to the construction of statutes said to effect the extinguishment of native title rights. Put shortly, when a statute purporting to affect the exercise of a native title right or interest for a particular purpose or in a particular way can be construed as doing no more than that, and not as extinguishing an underlying right, or an incident thereof, it should be so construed. That approach derives support from frequently repeated observations the construction of statutes said to extinguish native title rights and interests. this Court about The early approach of this Court in Mabo v Queensland [No 1]39 and Mabo v Queensland [No 2]40 to determine whether native title rights or interests 35 (1999) 201 CLR 351 at 373 [39] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 36 (1995) 183 CLR 373; [1995] HCA 47. 37 (1995) 183 CLR 373 at 474 per Mason CJ, Brennan, Deane, Toohey, Gaudron and 38 Their Honours' conclusion was based on their rejection of the State of Western Australia's submission that s 211 constituted an impermissible attempt to control the exercise of State legislative power: (1995) 183 CLR 373 at 475–476. 39 (1988) 166 CLR 186; [1988] HCA 69. 40 (1992) 175 CLR 1; [1992] HCA 23. Crennan had been extinguished by legislative or executive action focused upon the intention to be imputed to the legislature or the executive. For both legislative and executive action, a plain and clear intention to extinguish native title was required41. Imputed legislative intention is, and always was, a matter of the construction of the statute. As was stated in Lacey v Attorney-General (Qld)42: "Ascertainment of legislative intention is asserted as a statement of compliance with the rules of construction, common law and statutory, which have been applied to reach the preferred results and which are known to parliamentary drafters and the courts." (footnote omitted) The identification of a statute's purpose may aid in its construction. That identification may be done by reference to the apparent legal effect and operation of the statute, express statements of its objectives and extrinsic materials identifying the mischief to which it is directed. However, purposive construction to ascertain whether a statute extinguishes native title rights or interests is not without difficulty where the statute was enacted prior to this Court's decision in Mabo [No 2] that the common law could recognise native title. The difficulty was described by Gummow J in Wik Peoples v Queensland43. The Court in that case was, as his Honour pointed out, construing statutes "enacted at times when the existing state of the law was perceived to be the opposite of that which it since has been held then to have been."44 That reality affected the application of the purposive approach to construction. The Court therefore focused on inconsistency as the criterion for extinguishment. In the case of competing rights — native title rights and interests on the one hand and statutory rights on the other — the question was45: "whether the respective incidents thereof are such that the existing right cannot be exercised without abrogating the statutory right. If it cannot, then by necessary implication, the statute extinguishes the existing right." 41 Mabo v Queensland [No 1] (1988) 166 CLR 186 at 213 per Brennan, Toohey and Gaudron JJ, Mason CJ at 195 and Wilson J at 201 agreeing with their construction; Mabo v Queensland [No 2] (1992) 175 CLR 1 at 64 per Brennan J, Mason CJ and McHugh J agreeing at 15, see also at 111 per Deane and Gaudron JJ, 195 per 42 (2011) 242 CLR 573 at 592 [43]; [2011] HCA 10. 43 (1996) 187 CLR 1. 44 (1996) 187 CLR 1 at 184. 45 (1996) 187 CLR 1 at 185. Crennan His Honour observed that that notion of inconsistency included the effect of a statutory prohibition of the activity in question. In Fejo v Northern Territory46 the plurality held that a grant of land in fee simple extinguished underlying native title because the two sets of rights were inconsistent with each other47. Similarly, in Yanner v Eaton the plurality said48: "native title is extinguished by the creation of rights that are inconsistent with the native title holders continuing to hold their rights and interests." Nevertheless, "[t]he extinguishment of such rights must, by conventional theory, be clearly established."49 The inconsistency criterion was considered in relation to statutory regulation in Yanner v Eaton. The plurality observed that "regulating the way in which rights and interests may be exercised is not inconsistent with their continued existence."50 Gummow J, in a separate judgment, noted that a requirement for an Indigenous person to obtain a permit under the Fauna Conservation Act 1974 (Q) to hunt did not abrogate the native title right to hunt51: "Rather, the regulation was consistent with the continued existence of that right." Inconsistency analysis was applied by this Court to the question whether the common law would recognise native title in the territorial sea. The answer to that question was in the affirmative. In The Commonwealth v Yarmirr, the Court found no inconsistency to exist between past or present laws relating to the territorial sea and recognition by the common law of Australia of native title rights and interests in relation to the seas and sea-beds in that area52. There was, 46 (1998) 195 CLR 96. 47 (1998) 195 CLR 96 at 126 [43]. 48 (1999) 201 CLR 351 at 372 [35]. 49 (1999) 201 CLR 351 at 372 [35]. 50 (1999) 201 CLR 351 at 372 [37] (emphasis in original). 51 (1999) 201 CLR 351 at 397 [115]. 52 (2001) 208 CLR 1 at 60 [76] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. Crennan however, an inconsistency between native title rights to exclusive possession and common law public rights to navigate and to fish and the international right of innocent passage recognised by Australia53. So it is that in this case the right to access and take the resources of the native title area is not an exclusive right. The pre-eminence of inconsistency as the criterion of extinguishment of native title rights by the grant of rights by the Crown or pursuant to statutory authority was reiterated by the plurality in Western Australia v Ward54. Their Honours warned against misunderstanding the criterion of "clear and plain intention" to extinguish, which had been used in earlier decisions of the Court. The subjective states of mind of those whose acts were alleged to have extinguished native title were irrelevant55: "As Wik and Fejo reveal, where, pursuant to statute, be it Commonwealth, State or Territory, there has been a grant of rights to third parties, the question is whether the rights are inconsistent with the alleged native title rights and interests. That is an objective inquiry which requires identification of and comparison between the two sets of rights." (footnotes omitted) In so saying, their Honours emphasised the need to identify and compare the two sets of rights. In so doing, they distinguished between activities on land and the right pursuant to which the land is used56. Their Honours went on to reject the proposition that there could be degrees of inconsistency between rights or, absent statutory powers, suspension of one set of rights in favour of another and said57: "Two rights are inconsistent or they are not. If they are inconsistent, there will be extinguishment to the extent of the inconsistency; if they are not, there will not be extinguishment." The State of Queensland relied upon that observation in its written submissions. While this case is concerned with inconsistency, it is not concerned with inconsistency of rights. The question in this case is whether successive statutory 53 (2001) 208 CLR 1 at 67 [94] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 54 (2002) 213 CLR 1. 55 (2002) 213 CLR 1 at 89 [78]. 56 (2002) 213 CLR 1 at 89 [78]. 57 (2002) 213 CLR 1 at 91 [82]. Crennan regimes were inconsistent with the recognition by the common law of an asserted native title right. The State of Queensland characterised the successive colonial, State and Commonwealth fisheries laws as inconsistent with a right to take fish or aquatic life for commercial purposes. The asserted inconsistency turned, critically, upon the general application of the statutory prohibitions against taking fish and aquatic life for such purposes, absent a licence. Extinguishment was said to flow from a comparison of the statutory regime and the rights claimed. The Commonwealth identified an inconsistency arising "because of the limited and defined creation of statutory rights to fish for commercial purposes which did not allow for the continued enjoyment of native title rights ... to fish for those purposes." The Commonwealth and the State of Queensland relied upon the decision of this Court in Harper v Minister for Sea Fisheries58. The question in that case was whether a fee charged for a licence to take abalone in Tasmania was an excise. To take abalone without a licence was prohibited by regulation. The Court held the fee was not a tax and therefore not a duty of excise. The licence conferred a privilege analogous to a profit à prendre. The fee for the licence was a charge for the acquisition of that right, which was akin to a property right. The effect of the licensing regime was to convert what was formerly in the public domain into "the exclusive but controlled preserve of those who hold licences."59 The public right to take abalone, "being a public not a proprietary right, [was] freely amenable to abrogation or regulation by a competent legislature"60. As the appellant submitted, Harper is not authority for the proposition that native title rights and interests, derived from traditional laws and customs and recognised by the common law, are as freely amenable to abrogation as public rights derived from the common law. Moreover, the decision in Harper did not deal with the question whether what is affected by a licensing regime is the exercise, for a particular purpose, of a broadly stated native title right capable of being exercised for any purpose. The submissions as to inconsistency made by the Commonwealth and the State of Queensland ought not to be accepted. The premise upon which they rest is the characterisation of the exercise, for a particular purpose, of a general native title right as the exercise of a lesser right defined by reference to that purpose. 58 (1989) 168 CLR 314; [1989] HCA 47. 59 (1989) 168 CLR 314 at 325 per Mason CJ, Deane and Gaudron JJ. 60 (1989) 168 CLR 314 at 330 per Brennan J. Crennan That characterisation is not a logical necessity. Nor is it necessary for coherence in the law. Its rejection is consistent with the maintenance of a proper distinction between proprietary or usufructuary rights and their exercise in particular ways or for particular purposes. The appeal on the first two grounds should be allowed. The reciprocal rights ground As appears from the Determination and the reasons of the primary judge, his Honour found that while all of the claim group members were, in aggregate, the holders of all of the native title rights, they did not hold them communally61. They were best described as "group rights and interests"62. The groups comprised the claim group members of each of the island communities who held emplacement-based rights in their respective areas or estates. There were also rights held by claim group members of more than one island community in shared areas63. The appellant had sought inclusion in the Determination of persons said to be the holders of "reciprocal rights". The primary judge held that those rights, being relationship-based, were not rights "in relation to" waters within the meaning of s 223(1) of the NT Act. The Full Court dismissed the appellant's cross-appeal against this aspect of the primary judge's decision. The reciprocal rights asserted by the appellant derived from the "customary marine tenure model", which the primary judge found to encompass two types of rights. The first were "ancestral occupation based rights" or "emplacement based rights". The second were "reciprocal rights"64. His Honour found that the latter differed from "occupation based rights". Their defining are held by each person who has or each group of persons who have a relevant reciprocal relationship (whether based in kinship or of another kind, such as tebud/thubud) with an ancestral occupation based rights holder or group of such rights holders; and 61 (2010) 204 FCR 1 at 137 [542]. 62 (2010) 204 FCR 1 at 137 [543]. 63 (2010) 204 FCR 1 at 137 [543]. 64 (2010) 204 FCR 1 at 33–34 [68]–[70]. 65 (2010) 204 FCR 1 at 127 [493]. Crennan can be called rights or interests because they are enforceable and sanctioned by appeal to the law or custom that associates the reciprocal obligation with the relationship and the law or custom that sanctions consequences for denial of the reciprocal obligation; are 'group' or 'individual' rights; cover the area covered by the rights held by the person or group upon whom the right depends (but ultimately subject to regulation by that person or group or by the descent group of ancestral occupation based rights holders for that area); the content of the rights is reciprocal shared access and use which permits the same activities as may be done by the person or group upon whom the right depends but does not include territorial control or livelihood and the exercise of the right is subject ultimately to control by ancestral occupation based rights holders." (emphasis in original) His Honour accepted that the Islander society has a body of laws and customs founded upon a dominant and pervasive principle of reciprocity and exchange. It is a principle which expresses notions of "respect, generosity and sharing, social and economic obligations and the personal nature of relationships"66. The relationships and the rights and obligations which arose out of them were personal in that the discharge of the performance obligation was the responsibility of the Islander host (in the case of a tebud relationship) or of the relative and not of the Island community. The relationship could be passed down through generations67. His Honour concluded that the parties to such status-based relationships had what could properly be described as rights and obligations recognised and expected to be honoured or discharged under Islander laws and customs. They were not mere privileges. However, they were not rights in relation to land or waters. His Honour said68: "They are rights in relation to persons. The corresponding obligations are likewise social and personal and can be quite intense in character. This 66 (2010) 204 FCR 1 at 129–130 [505]. 67 (2010) 204 FCR 1 at 130 [507]. 68 (2010) 204 FCR 1 at 130 [508]. Crennan emerges clearly in the Islander evidence, the predominant emphases being on helping, sharing, being hospitable." The Full Court dismissed the cross-appeal on this ground, substantially for the reasons given by the primary judge. In their joint judgment, Keane CJ and Dowsett J observed that the primary judge's use of the term "status-based" as a description of the reciprocal relationships was derived from the evidence of an expert witness called on behalf of the appellant. Their Honours said69: "Such rights cannot be said to be possessed by the claimants themselves, so far as they relate to land and waters: such rights are not held by reason of the putative holders' own connection under their laws and customs with the land and waters in question but are held mediately through a personal relationship with a native title holder who does have the requisite connection". Putting to one side the reference to "connection", which was criticised by the appellant in his submissions to this Court, it is sufficient to say that the primary judge was correct in his characterisation, on the basis of the evidence before him, of the reciprocal rights as rights of a personal character dependent upon status and not rights in relation to the waters. The appeal against this aspect of the Full Court's judgment should be dismissed. Conclusion For the above reasons, the appeal should succeed on the extinguishment question, but fail on the reciprocity of rights question. The following orders should be made: Appeal allowed in part. Set aside par 1 of the order made by the Full Court of the Federal Court of Australia on 14 March 2012 and, in its place, order that the appeal to that Court is dismissed. The first and second respondents pay the appellant's costs of the appeal to this Court. Appeal otherwise dismissed. 69 (2012) 204 FCR 260 at 306 [130]. HAYNE, KIEFEL AND BELL JJ. The facts and circumstances giving rise to this appeal are described in the reasons of French CJ and Crennan J. As is explained in those reasons, there are two issues in this appeal: one about extinguishment and the other about reciprocal rights. We agree that, for the reasons given by French CJ and Crennan J, the appeal about reciprocal rights should be dismissed. For the reasons which follow, the appeal about extinguishment should be allowed and the primary judge's determination restored. The primary judge's determination The primary judge, Finn J, determined70 that the native title holders (represented by the appellant in this Court) hold native title rights and interests in defined areas of waters of the Torres Strait. Those native title rights and interests were described in the native title determination made by Finn J as "the rights to access, to remain in and to use the native title areas" and, subject to some qualifications about minerals and petroleum resources which need not now be noticed, "the right to access resources and to take for any purpose resources in the native title areas". The Full Court On appeal, the Full Court of the Federal Court (Keane CJ and Dowsett J, Mansfield J dissenting) held71 that the determination made by Finn J should be varied. The Full Court found72 the continued existence of a native title right and interest "to access resources and to take for any purpose resources in the native title areas" to be inconsistent with, and to have been partly extinguished by, successive Commonwealth73 and Queensland Acts74 which prohibited taking fish 70 Akiba v Queensland (No 3) (2010) 204 FCR 1. 71 Commonwealth v Akiba (2012) 204 FCR 260. 72 (2012) 204 FCR 260 at 295-296 [84]-[87] per Keane CJ and Dowsett J. 73 In particular, Fisheries Act 1952 (Cth), Pearl Fisheries Act 1952 (Cth), Continental Shelf (Living Natural Resources) Act 1968 (Cth), Torres Strait Fisheries Act 1984 (Cth) and Fisheries Management Act 1991 (Cth). See (2012) 204 FCR 260 at 275 74 In particular, Queensland Fisheries Act 1877 (Q), Pearl-shell and Bêche-de-mer Fishery Act 1881 (Q), Oyster Act 1886 (Q), Queensland Fisheries Act 1887 (Q), Fish and Oyster Act 1914 (Q), Fisheries Act 1957 (Q), Fisheries Act 1976 (Q), (Footnote continues on next page) or other aquatic life for commercial purposes without a licence. Accordingly, the Full Court ordered that the determination that the native title holders had "the right to access resources and to take for any purpose resources in the native title areas" be varied75 by adding the qualification that the right "does not, however, extend to taking fish and other aquatic life for sale or trade". Relevant principles Resolution of the extinguishment issue presented in this appeal depends upon applying principles established and applied by this Court in several decisions about the Native Title Act 1993 (Cth) ("the NTA"). Those decisions include Wik Peoples v Queensland76, Fejo v Northern Territory77, Yanner v Eaton78, The Commonwealth v Yarmirr79 and Western Australia v Ward80. In particular, resolution of the extinguishment issue depends upon four propositions. Three are identified most conveniently by reference to the plurality reasons in Ward. First, "[b]ecause what is claimed in the present [matter is] claims made under the NTA, for rights defined in the NTA, it is that statute which governs"81 (original emphasis). Second, "[t]he NTA provides that there can be partial extinguishment or suspension of native title rights"82. Third, Fisheries Act Amendment Act 1981 (Q) and Fisheries Act 1994 (Q). See (2012) 204 FCR 260 at 275-279 [41]-[42]. 75 (2012) 204 FCR 260 at 308 [145]. 76 (1996) 187 CLR 1; [1996] HCA 40. 77 (1998) 195 CLR 96; [1998] HCA 58. 78 (1999) 201 CLR 351; [1999] HCA 53. 79 (2001) 208 CLR 1; [2001] HCA 56. 80 (2002) 213 CLR 1; [2002] HCA 28. 81 (2002) 213 CLR 1 at 208 [468] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. See also at 60 [2], 64-69 [14]-[25]. 82 (2002) 213 CLR 1 at 208 [468] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. See also at 63 [9], 69-70 [26]-[29], 89 [76]. "[q]uestions of extinguishment first require identification of the native title rights and interests that are alleged to exist"83. The fourth proposition of critical importance to the determination of this appeal is established by, and reflected in, all five of the cases that have been mentioned84. It is that inconsistency of rights lies at the heart of any question of extinguishment. Something more must be said about each of these propositions. The statute governs As the plurality noted85 in Ward, this Court's decisions in Wik, Fejo and Yanner "were not given in appeals brought in respect of the determination by the Federal Court of applications under the NTA". By contrast with those three cases, but like Yarmirr and Ward, this is an appeal against orders of the Full Court of the Federal Court made on appeal against a determination of native title made by a single judge of the Federal Court. The determination provisions of the NTA are directly engaged. The NTA "lies at the core of this litigation"86. Questions about extinguishment of native title rights and interests cannot be answered without beginning in the relevant provisions of the NTA. 83 (2002) 213 CLR 1 at 208 [468] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. See also at 91-95 [83]-[95]. 84 See, for example, Wik (1996) 187 CLR 1 at 133 per Toohey J, 185-186 per Gummow J; Fejo (1998) 195 CLR 96 at 126 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; Yanner (1999) 201 CLR 351 at 372 [35] per Gleeson CJ, Gaudron, Kirby and Hayne JJ; Yarmirr (2001) 208 CLR 1 at 49 [42] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; Ward (2002) 213 CLR 1 at 89-91 [78]-[82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 85 (2002) 213 CLR 1 at 60 [2] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 86 Ward (2002) 213 CLR 1 at 60 [2] per Gleeson CJ, Gaudron, Gummow and The expression "native title" or "native title rights and interests" is defined in s 22387. Paragraphs (a) and (b) of s 223(1) indicate that it is from the traditional laws and customs that native title rights and interests derive, not the common law88. Section 10 of the NTA provides that "[n]ative title is recognised, and protected, in accordance with" the NTA and s 11(1) provides that native title cannot be extinguished contrary to the NTA. In this case, partial extinguishment of native title was said to have been effected by the making of legislation prohibiting taking, without a licence issued under the relevant Act, fish or other aquatic life for sale or trade. Section 226 of the NTA provides that "the making ... of any legislation"89 was one species of an Accordingly, in considering questions about act affecting native title. 87 Section 223 relevantly provides: "Common law rights and interests The expression native title or native title rights and interests means the communal, group or individual rights and interests of Aboriginal peoples or Torres Strait Islanders in relation to land or waters, where: the rights and interests are possessed under the traditional laws acknowledged, and the traditional customs observed, by the Aboriginal peoples or Torres Strait Islanders; and the Aboriginal peoples or Torres Strait Islanders, by those laws and customs, have a connection with the land or waters; and the rights and interests are recognised by the common law of Australia. Hunting, gathering and fishing covered Without limiting subsection (1), rights and interests in that subsection includes hunting, gathering, or fishing, rights and interests." 88 Ward (2002) 213 CLR 1 at 66 [20] per Gleeson CJ, Gaudron, Gummow and 89 s 226(2)(a). extinguishment said to have been effected by the making of legislation prohibiting commercial fishing without a licence, regard must be had to s 227 of the NTA, which provides that: "An act affects native title if it extinguishes the native title rights and interests or if it is otherwise wholly or partly inconsistent with their continued existence, enjoyment or exercise." As Toohey J said in Wik90 (with the concurrence of Gaudron, Gummow and Kirby JJ): "Whether there was extinguishment can only be determined by reference to such particular rights and interests as may be asserted and established. If inconsistency is held to exist between the rights and interests conferred by native title and the rights conferred under the statutory grants, those rights and interests must yield, to that extent, to the rights of the grantees." (emphasis added) Two other aspects of the NTA may be mentioned but put aside from further consideration. First, it was not submitted in this appeal that the making of the early legislation about fishing which was said to have extinguished native title (particularly the Fisheries Act 1952 (Cth) and the Queensland Fisheries Act 1887 (Q)) was a "past act" within the meaning of s 228 of the NTA. And no separate argument for extinguishment was advanced with respect to later legislation which may have fallen within the definition of a "past act". Accordingly those provisions of the NTA which deal with a "past act" may be put aside from consideration. The question is whether the legislation about fishing was "effective at common law to work extinguishment of native title"91. Second, it was not submitted that the "non-extinguishment principle" dealt with in s 238 was engaged, and again, that provision may be put aside from consideration. Partial extinguishment The NTA postulates that there may be partial extinguishment of native title rights and interests92. So, for example, s 23A(1) of the NTA speaks of the 90 (1996) 187 CLR 1 at 133. 91 Ward (2002) 213 CLR 1 at 62 [5] per Gleeson CJ, Gaudron, Gummow and 92 Ward (2002) 213 CLR 1 at 70 [29] per Gleeson CJ, Gaudron, Gummow and provisions of Div 2B of Pt 2 of the NTA providing that certain acts "attributable to the Commonwealth that were done on or before 23 December 1996 will have completely or partially extinguished native title". And that postulate of the NTA is wholly consistent with the conclusion reached by the plurality in Ward93 that native title rights and interests may properly be seen as a bundle of rights, the separate components of which may be extinguished separately. As the plurality said94 in Ward, "it is a mistake to assume that what the NTA refers to as 'native title rights and interests' is necessarily a single set of rights relating to land [or waters] that is analogous to a fee simple". The native title rights and interests in issue As has already been noted, debate about extinguishment must begin by identifying the native title rights and interests that are in issue. As s 225 of the NTA required, the determination of native title made in this case, by Finn J, identified the holders of the rights comprising the native title and identified the areas in respect of which those rights and interests existed. The relevant native title rights and interests were determined to be "the rights to access, to remain in and to use the native title areas" and, subject to some presently irrelevant qualifications about minerals and petroleum resources, "the right to access resources and to take for any purpose resources in the native title areas". These are the rights and interests which are at stake. Have these rights and interests been partially extinguished? More particularly, did the enactment of laws which prohibited the unlicensed taking of fish or other aquatic life for commercial purposes partially extinguish the right to take resources for any purpose? Inconsistency of rights This Court held in Western Australia v The Commonwealth (Native Title Act Case)95 that, at common law, native title rights and interests can be extinguished by "a valid exercise of sovereign power inconsistent with the continued enjoyment or unimpaired enjoyment of native title96". In Yanner, the 93 (2002) 213 CLR 1 at 89 [76] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 94 (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 95 (1995) 183 CLR 373 at 439 per Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ; [1995] HCA 47. 96 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 64 per Brennan J, 110-111 per Deane and Gaudron JJ; [1992] HCA 23. plurality noted97 that the "extinguishment of such rights must, by conventional theory, be clearly established98". Likewise, as the plurality held in Ward99, under the NTA, "[w]hether native title rights have been extinguished by a grant of rights to third parties or an assertion of rights by the executive requires comparison between the legal nature and incidents of the right granted or asserted and the native title right asserted". As was also noted100, however, by the plurality in Ward, while it is often said that a "clear and plain intention" to extinguish native title must be demonstrated, it is important that this expression not be misunderstood. The relevant question is one of inconsistency, and that is an objective inquiry. The "subjective thought processes of those whose act is alleged to have extinguished native title are irrelevant"101. Hence, as the NTA acknowledges in s 211, and as was held102 in Yanner, "[r]egulating particular aspects of the usufructuary relationship with traditional land does not sever the connection of the Aboriginal peoples concerned with the land (whether or not prohibiting the exercise of that relationship altogether might, or might to some extent)". Likewise, regulating particular aspects of the usufructuary relationship with traditional waters does not sever the connection of the Torres Strait Islanders concerned with those waters (whether or not prohibiting the exercise of that relationship altogether might, or might to some extent). Not only does regulation of a native title right to take resources from land or waters not sever the connection of the peoples concerned with that land or those waters, regulation of the native title right is not inconsistent with the continued existence of that right. Indeed, as was pointed out in Yanner103, 97 (1999) 201 CLR 351 at 372 [35] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 98 Wik (1996) 187 CLR 1 at 85 per Brennan CJ, 125 per Toohey J, 146-147 per Gaudron J, 185 per Gummow J, 247 per Kirby J. 99 (2002) 213 CLR 1 at 208 [468] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. See also at 89-91 [78]-[82]. 100 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 101 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 102 (1999) 201 CLR 351 at 373 [38] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 103 (1999) 201 CLR 351 at 372 [37] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. "regulating the way in which a right may be exercised presupposes that the right exists". Of course, regulation may shade into prohibition104, and the line between the two may be difficult to discern105. But the central point made in Yanner, and reflected in each of Wik, Fejo, Yarmirr and Ward, is that a statutory prohibition on taking resources from land or waters without a licence does not conclusively establish extinguishment of native title rights and interests of the kind found to exist in this case: "the rights to access, to remain in and to use the native title areas", and "the right to access resources and to take for any purpose resources in the native title areas". Prohibition of a particular activity In this case, the majority in the Full Court identified106 the starting point for consideration of extinguishment as "whether the activity which constitutes the relevant incident of native title is consistent with competent legislation relating to that activity" (emphasis added). The essential premise for the analysis that followed was that the relevant "activity" was to be identified as "taking fish and other aquatic life for sale or trade" and that the activity identified in this way was an "incident of native title". That premise is flawed. The relevant native title right that was found to exist was a right to access and to take resources from the identified waters for any purpose. It was wrong to single out taking those resources for sale or trade as an "incident" of the right that had been identified. The purpose which the holder of that right may have had for exercising the right on a particular occasion was not an incident of the right; it was simply a circumstance attending its exercise. Focusing upon the activity described as "taking fish and other aquatic life for sale or trade", rather than focusing upon the relevant native title right, was apt to, and in this case did, lead to error. That shift of focus, from right to activity, led to error in this case by inferentially reframing the question determinative of 104 (1999) 201 CLR 351 at 372 [37] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 105 Melbourne Corporation v Barry (1922) 31 CLR 174 at 188-190 per Isaacs J, 211-212 per Higgins J; [1922] HCA 56; Williams v Melbourne Corporation (1933) 49 CLR 142 at 148-149 per Starke J, 155-156 per Dixon J; [1933] HCA 56; Brunswick Corporation v Stewart (1941) 65 CLR 88 at 93-94 per Rich ACJ, 95 per Starke J; [1941] HCA 7; Municipal Corporation of City of Toronto v Virgo [1896] AC 88 at 93-94. See also Yanner (1999) 201 CLR 351 at 372 [37] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. 106 (2012) 204 FCR 260 at 287 [63]. extinguishment as being whether the statutory prohibition against fishing for a particular purpose without a licence was inconsistent with the continued existence of a native title right to fish for that purpose. But the relevant native title right that was found in this case was a right to take resources for any purpose. No distinct or separate native title right to take fish for sale or trade was found. The prohibition of taking fish for sale or trade without a licence regulated the exercise of the native title right by prohibiting its exercise for some, but not all, purposes without a licence. It did not extinguish the right to any extent. The Full Court's focus upon a particular activity was not consistent with the plurality's observation107 in Ward that reference to activity "is relevant only to the extent that it focuses attention upon the right". The focus upon the activity led to the majority framing the relevant question as being whether the identified activity was "consistent with competent legislation relating to that activity"108. But extinguishment of native title rights and interests is not to be determined by asking whether the federal or State legislature has asserted control, or dominion, over a particular activity, and then concluding that the relevant native title right no longer includes the right to pursue that form of activity. To pursue an inquiry of that kind would be apt to revive some variation of the adverse dominion test for extinguishment rejected109 by this Court in Ward. The enactment of legislation controlling some activity which may be undertaken in exercise of a native title right or interest presents a question about extinguishment. The extinguishment question is to be answered by deciding whether the legislation is inconsistent with the relevant native title right or interest; it is not determined by observing only that there is legislation which governs or affects the exercise of the right. These are reasons enough to reject the conclusion reached by the majority in the Full Court. There are, however, three particular errors in reasoning to which reference must be made. Three particular matters First, the majority in the Full Court said110 that the "general conservation objectives" of the relevant legislation prohibiting commercial fishing without a 107 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 108 (2012) 204 FCR 260 at 287 [63]. 109 (2002) 213 CLR 1 at 89 [76] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 110 (2012) 204 FCR 260 at 295 [84]. licence could "be easily defeated by the expedient of traders buying fish in commercial quantities from native title holders". That is obviously right, but it is irrelevant to the issue of extinguishment. It is an observation that assumes that the native title holders may take fish for sale or trade without a licence under the relevant legislation. But it was not suggested in the Full Court, or in this Court, that the exercise of the native title right to take resources from the native title areas was, or is, unaffected by legislation about fishing. Contrary to the reasoning of the majority in the Full Court, inconsistency is not demonstrated by assuming that exercise of the native title right or interest would be unaffected by the law or laws in issue. That is, it is not to the point to ask, as the Full Court did, what the position would be if the legislation did not affect the exercise of native title rights and interests. The only question is whether the legislation has extinguished the right in whole or in part. Second, the majority in the Full Court were wrong to treat111 the decision in Yanner as depending wholly upon the availability and operation of s 211 of the NTA. (It will be recalled that s 211 permits holders of native title rights to hunt or fish to exercise those rights "for the purpose of satisfying their personal, domestic or non-commercial communal needs"112, despite legislation prohibiting or restricting that activity other than in accordance with a statutory licence.) Section 211 can be engaged only if relevant native title rights and interests continue to exist. What is presently important is that Yanner established that legislation may regulate the exercise of native title rights and interests without extinguishing those rights or interests. And it is important to recognise that this Court held in Yanner that the relevant native title rights and interests continued to exist despite the nature and extent of the regulation effected by the legislation at issue in that case, the Fauna Conservation Act 1974 (Q). Like the various forms of fisheries legislation at issue in this appeal, the Fauna Conservation Act prohibited taking fauna without a licence. But the Fauna Conservation Act went further than the legislation now in issue in two respects. First, it prohibited taking fauna without a licence for any purpose. Second, it provided that all fauna (other than fauna taken during an open season with respect to that fauna) "is the property of the Crown and under the control of 111 (2012) 204 FCR 260 at 293-294 [79]-[81]. 112 s 211(2)(a). the Fauna Authority". This Court held113 that the Fauna Conservation Act did not extinguish the relevant native title rights and interests. Third, Finn J was right to hold114 that this Court's decision in Harper v Minister for Sea Fisheries115 does not have any direct application to the issues of extinguishment of native title rights and interests which arise in this appeal. Nor does Harper provide useful guidance about those issues. To the extent to which the decision of the majority in the Full Court depended116 upon drawing on what was said in Harper, that reasoning was erroneous. Harper decided that, on its true construction, legislation providing for the licensed taking of abalone abrogated the common law public right to fish for abalone. That is, Harper decided that an Act dealt with a subject comprehensively, to the exclusion of a common law right. The question decided in Harper was, therefore, radically different117 from the question presented in this appeal. This case concerns the relationship between legislation prohibiting commercial fishing without a licence and rights and interests which are rooted, not in the common law, but in the traditional laws acknowledged, and traditional customs observed, by Torres Strait Islanders. Conclusion and orders As the plurality in Yanner held118, "saying to a group of Aboriginal peoples, 'You may not hunt or fish without a permit', does not sever their connection with the land concerned and does not deny the continued exercise of the rights and interests that Aboriginal law and custom recognises them as possessing" (emphasis added). Likewise, telling the native title holders in this case, "You may not fish for the purpose of sale or trade without a licence", did not, and does not, sever their connection with the waters concerned and it did not, and does not, deny the continued exercise of the rights and interests possessed by 113 (1999) 201 CLR 351 at 373 [40] per Gleeson CJ, Gaudron, Kirby and Hayne JJ, 400 [123] per Gummow J. 114 (2010) 204 FCR 1 at 209 [842]. 115 (1989) 168 CLR 314; [1989] HCA 47. 116 (2012) 204 FCR 260 at 288-290 [71]-[73]. 117 Yanner (1999) 201 CLR 351 at 374 [41] per Gleeson CJ, Gaudron, Kirby and 118 (1999) 201 CLR 351 at 373 [38]. them under the traditional laws acknowledged, and traditional customs observed, by them. The repeated statutory injunction, "no commercial fishing without a licence", was not, and is not, inconsistent with the continued existence of the relevant native title rights and interests. The Full Court was wrong to conclude that the determination of native title rights and interests made at first instance should be varied. The orders proposed by French CJ and Crennan J should be made.
HIGH COURT OF AUSTRALIA Matter No S449/2005 ISLAND MARITIME LIMITED APPELLANT AND Matter No S450/2005 SACHIN KULKARNI  APPELLANT AND Island Maritime Limited v Filipowski Kulkarni v Filipowski [2006] HCA 30 15 June 2006 S449/2005 & S450/2005 ORDER In each matter, the appeal is dismissed. On appeal from the Supreme Court of New South Wales Representation P Byrne SC with G J Grogin and C P Carter for the appellants (instructed by Ebsworth & Ebsworth) A J Meagher SC with A L Hill and A J Payne for the respondent (instructed by Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Island Maritime Limited v Filipowski Kulkarni v Filipowski Criminal law – Double jeopardy – Autrefois acquit – Successive charges arising out of same facts – Charge brought against appellants under s 27(1) of the Marine Pollution Act 1987 (NSW) – Charge dismissed on basis that s 27(1) did not apply where a charge was available under s 8 – Charge subsequently brought against appellants under s 8 – Where s 27(1) offence included all elements of s 8 offence together with additional element – Whether second charge barred by principles of autrefois acquit – Whether appellants stood in jeopardy on first charge – Whether plea of autrefois acquit available if all elements of offence first charged not included in elements of offence charged second. Criminal law – Abuse of process – Delay – Where first prosecution brought more than two years after the relevant events – Where second prosecution brought eight months after first defective prosecution dismissed. Words and phrases – "abuse of process", "autrefois acquit", "double jeopardy", "in jeopardy". Marine Pollution Act 1987 (NSW), ss 8, 27(1). GLEESON CJ, HEYDON AND CRENNAN JJ. These appeals relate to an alleged discharge of oil from a ship, the "Pacific Onyx", into Botany Bay on 14 November 1999. The owner of that ship is alleged to be Island Maritime Limited and the master is alleged to be Sachin Kulkarni ("the appellants"). On 20 February 2002, the prosecutor, Barbara Filipowski ("the respondent"), filed two identically worded summonses in the Land and Environment Court of New South Wales alleging a contravention by each of the appellants of s 27(1) of the Marine Pollution Act 1987 (NSW) ("the Marine Pollution Act"). Section 55(1)(b) of the Marine Pollution Act provides that proceedings for an offence against the Act "may be dealt with summarily before ... the Land and Environment Court in its summary jurisdiction". A trial proceeded before that Court on 20 and 21 February 2003, in which the prosecution called all its evidence. Talbot J dismissed the summonses on 7 March 20031. On 18 November 2003, two further summonses relating to the alleged discharge of oil on 14 November 1999 were filed. This second set of summonses was identical to the first, save that the legislation allegedly contravened was not s 27(1) of the Marine Pollution Act, but s 8. It was the respondent's intention to use the same evidence as had been tendered at the trial of the first set of summonses. The appellants filed a notice of motion seeking a permanent stay of the second set of summonses on the grounds that the proceedings were barred by the principles of autrefois acquit or that the proceedings were an abuse of process. Bignold J dismissed the application for a stay2. The Court of Criminal Appeal dismissed an appeal3. The question here is whether the Court of Criminal Appeal was correct to dismiss the appellants' appeal. That question must be answered affirmatively. The possibility of a bar arising from the principles of autrefois acquit does not exist because the appellants were never in the relevant sense "in jeopardy" on the first set of summonses; and, unsatisfactory though the history of these proceedings may be, the respondent's conduct is not an abuse of process. 1 Filipowski v Island Maritime Limited (2003) 124 LGERA 331. 2 Filipowski v Island Maritime Limited (2004) 135 LGERA 229. Island Maritime Limited v Barbara Filipowski [2004] NSWCCA 453 (Sully, Crennan Statutory background The damaging effects of discharging oil into the sea or other waters have attracted the attention of the New South Wales legislature for some time. Section 3(1) of the Oil in Navigable Waters Act 1927 (NSW), which was modelled on United Kingdom legislation4, prohibited the discharge of oil into the territorial waters of New South Wales and other waters such as harbours, estuaries, rivers and canals, whether the discharge was from vessels, from the land or from apparatus used to transfer oil to or from vessels. That legislation was repealed and replaced by the Prevention of Oil Pollution of Navigable Waters Act 1960 (NSW). That Act remained in force until the Marine Pollution Act came into force on 4 May 19905. The Marine Pollution Act was part of a cooperative scheme with the Commonwealth. The scheme was developed as a result of Australia's adhesion to the International Convention for the Prevention of Pollution from Ships, 1973 ("the Convention")6. Annex I to the Convention deals with oil pollution and Annex II with pollution by noxious liquid substances in bulk. The Convention obliges State parties to enact laws prohibiting discharges from their own ships "wherever the violation occurs" and from foreign ships "within the jurisdiction" of the party7. The Commonwealth met its obligations under the Convention by enacting the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 ("the Commonwealth Act"). Parts II and III prohibited discharges from Australian ships into the sea outside the territorial sea of Australia; Pt II applied to discharges of oil (s 9) and Pt III to discharges of noxious fluid substances (s 21). When the Commonwealth Act was enacted in 1983, it was assumed that complementary State and Territory legislation would be enacted containing identical prohibitions in relation to the territorial sea of Australia and that sea on its landward side8. Delay took place in enacting that legislation, and in 4 Oil in Navigable Waters Act 1922, s 1. 5 New South Wales Government Gazette, No 57 at 3509, 4 May 1990. 6 The original Convention is Sched 1 to the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (Cth). The Protocol of 1978 amending the Convention is Sched 2 to that Act. 7 Articles 1 and 4 of the Convention. 8 Australia, House of Representatives, Parliamentary Debates (Hansard), 19 February 1986 at 870-871. Crennan consequence the Commonwealth Act was amended in 1986 by the Protection of the Sea (Prevention of Pollution from Ships) Amendment Act 1986 (Cth)9. The amendments extended the prohibitions in Pts II and III to cover discharges by ships into the territorial sea of Australia and into that sea on its landward side. The responsible Commonwealth Ministers pointed out that this would not infringe any State or Territory rights because there was a saving provision to ensure that the Commonwealth Act would not apply when State or Territory legislation came into force for the territorial sea and that sea on its landward side. What they meant can be seen by taking the provisions affecting oil discharges in relation to States as an example. Section 9(1) of the Commonwealth Act provides that, subject to s 9(1A), the master and the owner of a ship from which a discharge of oil or an oily mixture into the sea takes place is guilty of a criminal offence. Section 9(1A) provides: "Subsection (1) does not apply in relation to the sea near a State ... to the extent that a law of that State ... makes provision giving effect to Regulations 9 and 11 of Annex I to the Convention in relation to that sea." Regulation 9 of Annex I prohibits discharges of oil or oily mixtures from ships into the sea, and reg 11 creates exceptions to the prohibition. The Commonwealth Act, in s 3(1A), defines the "sea near a State" as a reference to: the territorial sea of Australia adjacent to the State; and the sea on the landward side of the territorial sea of Australia adjacent to the State". The substantive aspects of the 1986 amendments to the Commonwealth Act came into force on 23 September 198810. The prohibition in s 9(1) of the Commonwealth Act as amended applied in relation to the territorial sea adjacent to New South Wales and the sea on the landward side of the territorial sea until 4 May 1990, for it was not until then that the Marine Pollution Act came into operation. That is, it was not until 4 May 1990 that a law of New South Wales made provision giving effect to regs 9 and 11 of Annex I to the Convention. The relevant provision was s 8 of the Marine Pollution Act, which appears in Pt 2. Section 8(1) provides: 9 Australia, Senate, Parliamentary Debates (Hansard), 20 March 1986 at 1367-1369. 10 Commonwealth of Australia Gazette, S291, 23 September 1988. Sections 1 and 2 of the amending Act had commenced on the date of assent, 24 June 1986. Crennan "(1) Subject to subsections (2) and (4), if any discharge of oil or of an oily mixture occurs from a ship into State waters, the master and the owner of the ship, and any other person whose act caused the discharge, are each guilty of an offence punishable, upon conviction, by a fine not exceeding: if the offender is a natural person – 2 000 penalty units, or if the offender is a body corporate – 10 000 penalty units." Section 8(2) and (4) create defences. The burden of proving the matters of fact in s 8(1) lies with the prosecution and the burden of proving a defence lies on the defence: s 8(6). The expression "State waters" is defined in s 3(1) as meaning: the territorial sea adjacent to the State, the sea on the landward side of the territorial sea adjacent to the State that is not within the limits of the State, and other waters within the limits of the State prescribed by the regulations for the purposes of this definition". The waters described in pars (a) and (b) correspond with those referred to in the Commonwealth Act as "the sea near a State". Thus, s 8 of the Marine Pollution Act is a law of the State of New South Wales giving effect to regs 9 and 11 of Annex I to the Convention in relation to the sea near New South Wales within the meaning of s 9(1A) of the Commonwealth Act. In these waters, the Marine Pollution Act applies and the Commonwealth Act does not. Similar provisions appear in Pt 3 of the Marine Pollution Act to ensure that in relation to the release the of noxious substances Commonwealth Act. is complementarity between it and there However, the Marine Pollution Act also introduced provisions not falling within s 9(1A). They appear in Pt 4. Among them are ss 26 and 27(1). Section 26 provides in part: "This Part applies to a discharge of oil or of an oily mixture or of a liquid substance or of a mixture containing a liquid substance into State waters: from a ship or place on land in or in connection with a transfer operation, or from any apparatus or purpose-built pipeline used in or in connection with a transfer operation, whether or not it is being so used, Crennan but does not apply: to a discharge to which Part 2 or 3 applies." Section 27(1) provides: If a discharge to which this Part applies occurs, each appropriate person in relation to the discharge, and any other person whose act caused the discharge, are each guilty of an offence punishable, upon conviction, by a fine not exceeding: if the offender is a natural person – 2 000 penalty units, or if the offender is a body corporate – 10 000 penalty units." There is a definition of "transfer operation" in s 25(1) as meaning: "... any operation that is involved in the preparation for, or in the commencement, carrying on or termination of, a transfer of oil or of an oily mixture or of a liquid substance or of a mixture containing a liquid substance to or from a ship or a place on land." Section 27(2) provides what are in substance defences, but they are less extensive than those which are referred to in s 8(2) and (4) and which correspond with those in regs 9 and 11 of Annex I to the Convention. On the other hand, the penalty for a contravention of s 27(1) is the same as that which exists for a contravention of s 8(1). The function of s 26(d) is plainly to ensure that in relation to discharges of the kind described in Pt II (in particular s 9(1)) and Pt III (in particular s 21(1)) of the Commonwealth Act, the only applicable State legislation is Pts 2 and 3 of the Marine Pollution Act. If this function were not fulfilled there would be a risk that Pt 4 would operate in a manner inconsistent with the Convention scheme reflected in the complementary Commonwealth and State legislation. The need for the accused to be "in jeopardy" It is not necessary to examine the arguments advanced by the appellants to support the conclusion that a plea of autrefois acquit was available. That is because a key precondition must be satisfied before consideration is given to the Crennan principles relating to a plea of autrefois acquit. The defendant must have been in jeopardy on the charge11. In Broome v Chenoweth12 the defendant, an employer, was charged by information with failing to make a compulsory deduction from an employee's wages, contrary to s 221C of the Income Tax Assessment Act 1936 (Cth). The defendant had earlier been charged on an information which counsel for the informant had attempted to withdraw because of defects in its form, but which a magistrate instead dismissed. Dixon J held that that order would have been capable of barring the second information on grounds of double jeopardy, but for one difficulty. His Honour said: "[T]here is left the question whether upon the earlier information there could have been a valid conviction. If a conviction in that proceeding could not have been effective, the defendant never did stand in jeopardy upon the earlier charge."13 Dixon J found that the first information failed to allege two ingredients in the offence. He then said14: "The old rule was that, if the defendant could have taken a fatal objection to the earlier indictment or information, his discharge or acquittal thereon could not afford a bar. 'The point in discussion always is whether, in fact, the defendant could have taken a fatal exception to the former indictment; for, if he could, no acquittal will avail him, but if he could not, it is always competent for him to shew the offences to be really the same, though they are variously stated in the proceedings'15. In the present instance I think that, unless the information had been amended, the defects I have mentioned are such that a conviction in its terms could not have been sustained." 11 Broome v Chenoweth (1946) 73 CLR 583. 12 (1946) 73 CLR 583. 13 (1946) 73 CLR 583 at 599. 14 (1946) 73 CLR 583 at 600. 15 Quoting Chitty's Criminal Law, 1st ed (1816), vol 1 at 455. Crennan Starke J reached the same conclusion. He relied16 on the following passage from Archbold's Criminal Pleadings17: "Generally it may be laid down that whenever, by reason of some defect in the record ... the prisoner was not lawfully liable to suffer judgment for the offences charged against him in the first indictment as it stood at the time of its finding, he has not been in jeopardy, in the sense which entitles him to plead the former acquittal (or conviction) in bar of a subsequent indictment." These principles have been summarised as follows18: "[I]t is essential that the defendant has been in jeopardy on the charge. If summary dismissal occurs because the charge is defective, or because as a matter of law the evidence available to the prosecution cannot support a conviction, the defendant will never have been in jeopardy ... . Where the dismissal was not founded upon a consideration of the merits, even in the largest and most liberal sense of that expression, there is no adjudication of the innocence of the accused." Neither Dixon J nor Starke J doubted that the relevant principles applied as much to summary proceedings on information as they did to prosecutions on indictment19. There is accordingly no reason to suppose that those principles do not apply to proceedings such as these, dealt with summarily before the Land and Environment Court in its summary jurisdiction, and the appellants did not submit that they could not. This flows from the fact that a plea of autrefois acquit rests on the rule against double jeopardy, as explained in Pearce v The Queen20. 16 (1946) 73 CLR 583 at 595. 17 31st ed (1943) at 138. 18 Spencer Bower, Turner and Handley, The Doctrine of Res Judicata, 3rd ed (1996) at 32, par 59. Counsel for the appellants relied on another passage at 173, par 321 (text at n 57), but that does not qualify the correctness of the passage quoted in relation to autrefois acquit; it is suggested rather to relate to abuse of process. The first authority cited in n 57, Williams v DPP [1991] 1 WLR 1160 at 1170; [1991] 3 All ER 651 at 658-659, supports the passage quoted. 19 (1946) 73 CLR 583 at 595 per Starke J and 600 per Dixon J. 20 (1998) 194 CLR 610 at 627-628 [61] per Gummow J; see also at 617 [22] per McHugh, Hayne and Callinan JJ. Crennan The proceedings before Talbot J Before Talbot J, the prosecution read affidavits and some cross- examination of the deponents took place. At the conclusion of the prosecution case, counsel for the defendants submitted that there was no case to answer, on two bases. The first was that the prosecution evidence, taken at its highest, could not establish that the discharge of oil occurred "in or in connection with a transfer operation" within the meaning of s 26(a) of the Marine Pollution Act, and hence the defendants could not be convicted. Talbot J did not accede to that submission, because it turned on the reliability of the expert evidence called by the prosecution, and that "must be left to the ultimate determination of fact"21. The second basis for the defendants' no case submission rested on s 26(d) of the Marine Pollution Act. Talbot J summarised it thus22: "The evidence clearly establishes the fact that there was a discharge of oil from the vessel into the State waters of Botany Bay. The simple submission is that Pt 2 applies because s 8(1) operates to make it an offence if any discharge of oil occurs from a ship into State waters. Part 4 does not apply to a discharge of oil to which Pt 2 applies by dint of s 26(d)." Talbot J accepted that submission23. Were the appellants "in jeopardy" on the first set of summonses? Counsel for the appellants contended that the trial before Talbot J had been conducted by the prosecution as, and was, a hearing on the merits. They argued that before Talbot J the prosecution pressed the view that the charges had been properly brought under s 27(1); that the present cases were not analogous to those instances of demurrers or formal objections or jurisdictional objections challenging proceedings at their very inception, which, according to the appellants, alone fell within the doctrine applied in Broome v Chenoweth; and 21 Filipowski v Island Maritime Limited (2003) 124 LGERA 331 at 337 [30]. 22 Filipowski v Island Maritime Limited (2003) 124 LGERA 331 at 337-338 [31]. 23 Filipowski v Island Maritime Limited (2003) 124 LGERA 331 at 338 [36], 339 Crennan that the defect in the first set of summonses only emerged after the whole of the prosecution's evidence had been called. Despite these submissions, there are three points of view from which it can be seen that on the first set of summonses there could not "have been a valid conviction", so that the appellants "never did stand in jeopardy", because they "could have taken a fatal exception", and hence they were "not lawfully liable to suffer judgment for the offences charged". First, the first set of summonses on their face are defective. A charge under s 27(1) of the kind which the prosecution wished to proffer requires an allegation not only that there was a discharge of oil into State waters from a ship, but also that the discharge was "in or in connection with a transfer operation". This latter allegation was missing from the first set of summonses, which only stated that the appellants were owner or master of "a ship ... from which a discharge of oil occurred into State waters namely the waters of Botany Bay in contravention of Section 27(1) of the Marine Pollution Act, 1987." Secondly, even if that problem were to be overlooked, or, as the appellants submitted, were cured by the reference to s 27(1), or were cured by amendment, it is plain on the face of the first set of summonses that no conviction for a contravention of s 27(1) could result from them. This is because the allegations that there was a discharge of oil into State waters from a ship brought the circumstances within s 8(1), and hence made the discharge one to which Pt 2 applied. Section 26(d) in turn had the consequence that Pt 4 did not apply, and hence no conviction under s 27(1) was possible. Thirdly, although the trial before Talbot J began as proceedings in which the prosecution was seeking to place the defendants in jeopardy by obtaining factual findings adverse to them, by the time the prosecution evidence had been tendered and the no case submission had been argued, it was plain that the only possible view of the evidence was that, as a matter of law, it negated any possibility of a conviction under s 27(1) because Pt 2 applied and Pt 4 did not. The question is whether the appellants "could have taken a fatal exception" to the summonses, not whether they did, or when they did; they were served before the trial with the affidavits on which the prosecution relied at the trial; and even if, contrary to the fact, the form of the summonses did not reveal that the point which eventually succeeded after the prosecution case ended could have been taken before it began, the evidence contained ample material on which it could have been taken. Accordingly, the appellants were never "in jeopardy" in the relevant sense before Talbot J, and his dismissal of the first set of summonses is incapable of supporting a plea of, or in the nature of, autrefois acquit. Crennan Autrefois acquit It is therefore not necessary to follow the course taken by the parties of analysing exhaustively the doctrines associated with autrefois acquit. In particular, it is not necessary to re-examine all of what was said in Pearce v The Counsel for the respondent attacked one aspect of Pearce v The Queen. It was the part of the following passage in the joint judgment to which emphasis has been added25: "It is clear that the plea in bar goes to offences the elements of which are the same as, or are included in, the elements of the offence for which an accused has been tried to conviction or acquittal." Counsel said that the words "are included in" should have been "include". When the passage is read in context, however, it is plain that the proposition which counsel for the respondent said the reasons for judgment should have asserted was in fact encompassed in what was said in Pearce v The Queen. There are three particular aspects of the context to note. One aspect of the context is that the words "are included in" were succeeded by a footnote reference to R v Elrington26. In that case the accused was charged on information with common assault. He was acquitted by justices of the peace, who certified that the information was not proved and was dismissed. The accused was then prosecuted on indictment for assault causing grievous bodily harm and assault causing actual bodily harm. The Court of Queen's Bench (Cockburn CJ and Blackburn J) held that the relevant statute meant that the certificate could be pleaded in bar to the indictment. However, the significance of the case goes beyond the operation of the statute, for 24 (1998) 194 CLR 610. 25 (1998) 194 CLR 610 at 616 [18] per McHugh, Hayne and Callinan JJ (footnotes omitted). 26 (1861) 1 B & S 688 [121 ER 870]. 27 R v Elrington (1861) 1 B & S 688 at 696 [121 ER 870 at 873]. Crennan "[W]e must bear in mind the well established principle of our criminal law that a series of charges shall not be preferred, and, whether a party accused of a minor offence is acquitted or convicted, he shall not be charged again on the same facts in a more aggravated form." The elements of assault causing grievous bodily harm are not "included in" the elements of common assault, but the former elements do include the latter. The second matter of context is the statement appearing a little later in the joint judgment in Pearce v The Queen28: "[T]here are sound reasons to confine the availability of a plea in bar to cases in which the elements of the offences charged are identical or in which all of the elements of one offence are wholly included in the other." R v Elrington was a case of that kind. A third feature of the context is that in the footnote appearing next after the reference to R v Elrington, the joint judgment referred approvingly to Li Wan Quai v Christie29. The explanation given of Griffith CJ's formulation of the test in that and other cases30 a little later in the joint reasons31 is consistent with the view that the joint judgment favoured acceptance of the plea of autrefois acquit where the elements of the offence charged second are the same as, or include, the elements of the offence charged first. As the joint judgment pointed out, when Griffiths CJ said in Li Wan Quai v Christie32 that "[t]he true test whether [a plea of autrefois acquit] is a sufficient bar in any particular case is, whether the evidence necessary to support the second charge would have been sufficient to procure a legal conviction upon the first", his reference to "evidence" must be understood as a reference to the facts 28 (1998) 194 CLR 610 at 618 [24] per McHugh, Hayne and Callinan JJ. 29 (1906) 3 CLR 1125 at 1131. 30 Ex parte Spencer (1905) 2 CLR 250 at 251; Chia Gee v Martin (1905) 3 CLR 649 31 (1998) 194 CLR 610 at 617 [20]. 32 (1906) 3 CLR 1125 at 1131. Crennan constituting the elements of the offence33. One thing is clear. Griffith CJ was referring to a case, like R v Elrington, where the offence the subject of the second charge was, to use the words of Cockburn CJ, a more aggravated form of the offence the subject of the first charge. In the passage from Li Wan Quai v Christie just quoted, which was cited in Pearce v The Queen, Griffith CJ referred to the 21st edition of Archbold's Criminal Pleading. His statement of the "true test" was taken directly from Archbold34, which, in turn, referred35 to R v Elrington. It cannot be that Pearce v The Queen was contradicting the propositions stated by Cockburn CJ and Griffith CJ. For our part, however, we find it unnecessary to decide whether the principle is wider than that stated in the older authorities, and whether it also covers a case in which the first prosecution was for the more aggravated form of offence and the second is for a lesser form. Such a case would be the reverse of that referred to by Cockburn CJ and Griffith CJ. These questions do not arise for decision. Abuse of process Counsel for the appellants contended that the second set of summonses should be stayed on the ground of oppression. He referred to many authorities illustrating different types of oppression, but none of them bore on the specific circumstances of this case. Counsel pointed to the delay in filing both the first set and the second set of summonses, to the prosecution's adoption at the trial before Talbot J of a stance diametrically opposed to its stance in the second set of summonses, and to the ordeal compulsorily undergone by the appellants of experiencing a trial which, the prosecution now conceded, they should never have been subjected to. Counsel did not claim any actual prejudice to the appellants independent of the inevitable prejudice caused by being a defendant in a criminal proceeding, but submitted that actual prejudice was not necessary. He submitted that it was not legitimate to expect a person in the position of the master, and in the position of responsible officers of the owner, to cope with a 33 (1998) 194 CLR 610 at 617 [20]: "the inquiry suggested ... is an inquiry about what evidence would be sufficient to procure a legal conviction. That invites attention to what must be proved to establish commission of ... the offences. That is, it invites attention to identifying the elements of the offences ...." (emphasis in original). See also Ostrowski v Palmer (2004) 218 CLR 493 at 501-503 [5]-[10] per Gleeson CJ and Kirby J. Crennan continuation of the prosecution after what had taken place before the second set of summonses was filed. The error by the prosecution in filing the first set of summonses as it did is regrettable but not oppressive. The appellants are not being prosecuted for the same offence, or overlapping offences: originally they were prosecuted for the wrong offence and now they are being prosecuted for the right one. The Court of Criminal Appeal rightly said that the delays that have taken place reveal a desultory approach which is to be deplored, but the delays, partly unexplained though they are, have not been of extraordinary length. The filing of the second set of summonses was not in substance anything more than a belated amendment of the first set. The problem with which the Convention, the Commonwealth Act and the Marine Pollution Act are attempting to deal is a very serious one. Depending on the circumstances eventually established, the crimes alleged against the appellants are serious. There is a high public interest in having the allegations disposed of, one way or the other, on the merits. Nothing has been pointed to which prevails over that interest, and no appellable error has been demonstrated in the handling of this question in the courts below. Order The appeals should be dismissed. GUMMOW AND HAYNE JJ. The facts and circumstances giving rise to these appeals, and the applicable statutory provisions, are set out in the reasons of Gleeson CJ, Heydon and Crennan JJ. It is unnecessary to repeat those matters. The first summonses filed by the respondent in the Land and Environment Court of New South Wales on 20 February 2002, and alleging contravention of s 27(1) of the Marine Pollution Act 1987 (NSW) ("the Act") showed, on their face, that an offence under s 27(1) could not be established. Those summonses charged that the first appellant was the owner, and the second appellant was the master, of a ship "from which a discharge of oil occurred into State waters namely the waters of Botany Bay". Section 27(1) of the Act created an offence "[i]f a discharge to which this Part [Pt 4] applies" occurred. Section 26(d) of the Act provided that Pt 4 did not apply "to a discharge to which Part 2 or 3 applies". Part 3 of the Act is not presently relevant. Part 2 governed the consequences of "any discharge of oil or of an oily mixture [which] occurs from a ship into State waters"36. On their face, the summonses that were first issued showed that the alleged discharge of oil was a discharge to which Pt 2 of the Act applied: they alleged that a discharge of oil had occurred into State waters, namely the waters of Botany Bay. It followed that the alleged discharge was not a discharge of the kind identified by s 27(1), namely "a discharge to which this Part [Pt 4] applies". If an offence had been committed, it was an offence under s 8 of the Act. jeopardy rule37 had no application Because the appellants were never in jeopardy of conviction of the offences charged in the first summonses issued, the maxim reflected in the double the subsequent summary proceedings instituted by the second set of summonses issued in the Land and Environment Court on 18 November 2003. A plea of autrefois acquit would not have been available if the proceedings in question had been on indictment. Neither the plea, nor the analogous application of the maxim in summary proceedings, was available because "the defendant never did stand in jeopardy upon the earlier charge"38; each "defendant could have taken a fatal objection"39 to the first summons that was issued. 36 Marine Pollution Act 1987 (NSW), s 8(1). 37 Pearce v The Queen (1998) 194 CLR 610 at 627-628 [61] per Gummow J. 38 Broome v Chenoweth (1946) 73 CLR 583 at 599 per Dixon J. 39 Broome v Chenoweth (1946) 73 CLR 583 at 600 per Dixon J. This is reason enough to conclude that the appeals must be dismissed. It is necessary, however, to deal with a point that lay at the heart of the arguments, both in this Court and in the Court of Criminal Appeal, and underpinned the reasoning adopted in the Court of Criminal Appeal40: a point about this Court's decision in Pearce v The Queen41. The arguments in this Court focused upon one passage taken from the joint reasons in Pearce42 where it was said that "[i]t is clear that the plea in bar goes to offences the elements of which are the same as43, or are included in44, the elements of the offence for which an accused has been tried to conviction or acquittal" (emphasis added). The Court of Criminal Appeal decided45 that Pearce thus established that a plea of autrefois acquit was not available if all of the elements of the offence first charged were not included in the elements of the offence charged second. Or, to put the same proposition positively, the Court of Criminal Appeal decided that Pearce established that a plea of autrefois acquit is available only if all of the elements of the offence first charged (for example, a simple assault) were included in the elements of the offence charged second (for example, an aggravated form of assault on the same victim on the same occasion). That is, the Court of Criminal Appeal held that the order in which charges are preferred is relevant to the availability of the plea of autrefois acquit and the application of the equivalent rule in a court of summary jurisdiction: a plea in bar is available only where the elements of the second charge include all the elements of the first charge. That is not right. The passage in the joint reasons upon which the argument fastened must be read in the context of the reasons as a whole. Pearce held that a plea in bar is available, or, in courts of summary jurisdiction, an equivalent rule is applied, in cases "in which the elements of the offences charged are identical or in which all of the elements of one offence are wholly 40 Island Maritime Ltd v Filipowski [2004] NSWCCA 453. 41 (1998) 194 CLR 610. 42 (1998) 194 CLR 610 at 616 [18] per McHugh, Hayne and Callinan JJ. 43 R v Emden (1808) 9 East 437 [103 ER 640]; R v Clark (1820) 1 Brod & B 473 [129 44 R v Elrington (1861) 1 B & S 688 [121 ER 870]. 45 [2004] NSWCCA 453 at [14] per Dunford J (with whom Sully and Hidden JJ agreed). included in the other"46. The order in which the charges are preferred does not affect the availability of the plea, or the applicability of the equivalent rule. It is as well to say more about why that is so. "Double jeopardy" is an expression that is not always used with a single meaning. It is an expression used in relation to several different stages of the process of criminal justice: prosecution, conviction and punishment. It describes values which underpin a number of aspects of the criminal law, rather than a rule that can be stated as the premise for deductive reasoning. The essence of these values is most often seen as captured in three maxims: interest reipublicae ut sit finis litium (it is in society's interest that there be an end to litigation), res judicata pro veritate accipitur (what is adjudicated is taken as the truth), and nemo debet bis vexari pro una et eadem causa (no one should twice be vexed for one and the same cause). It is these values that underpin the rule that evidence is inadmissible where, if accepted, it would overturn or tend to overturn an acquittal47. It is these values that inform the rules governing successive prosecutions – rules which find their origins in the pleas in bar of autrefois convict and autrefois acquit but now have wider application than those pleas in bar. Principles governing the availability of a plea in bar of either autrefois convict or autrefois acquit were developed and applied in courts of record. As Deane and Gaudron JJ pointed out in Rogers v The Queen48, "[a]utrefois convict is the application in criminal proceedings of the doctrine of merger which gives rise to res judicata or cause of action estoppel in civil proceedings". Just as judgment of a court of record in a civil action changes the cause of action to a matter of record49, conviction in a court of record in respect of a criminal offence brings about "the substitution of a new liability"50. As Gummow J noted in Pearce51, this principle of merger is connected with, but distinct from, the principles encapsulated in the three maxims cited earlier. Those principles are of fundamental importance to the structure and operation of our legal system. 46 (1998) 194 CLR 610 at 618 [24] per McHugh, Hayne and Callinan JJ, 628 [63] per 47 Garrett v The Queen (1977) 139 CLR 437 at 445; Rogers v The Queen (1994) 181 CLR 251 at 277-278; R v Carroll (2002) 213 CLR 635. 48 (1994) 181 CLR 251 at 276-277. 49 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 606. 50 R v Wilkes (1948) 77 CLR 511 at 519. 51 (1998) 194 CLR 610 at 625 [53]-[54]. The plea of autrefois acquit "is the species of estoppel by which the Crown is precluded from reasserting the guilt of the accused when that question has previously been determined against it"52. It is a plea that prevents the relitigation of matters already determined in favour of the accused. Like the plea of autrefois convict, the plea of autrefois acquit prevents inconsistent decisions, serves to maintain the acceptance of orders and other solemn acts of the courts as incontrovertibly correct, and avoids the injustice occasioned by the relitigation of what has already been determined. But until more recent times, the pleas of autrefois acquit and autrefois convict "remained the only manifestations of the rule against double jeopardy"53. As the criminal law has become more complex, and as the number of offences that may be dealt with summarily has increased, questions of double jeopardy have taken on greater significance. When criminal offences were relatively few and distinct, a single course of conduct would constitute but one offence. With the proliferation of overlapping and related statutory offences, a single allegedly criminal transaction will often yield numerous offences54. That it is the values of double jeopardy that inform the rules about double prosecutions is most easily demonstrated by reference to summary prosecutions. First, a conviction in a court of summary jurisdiction does not invoke doctrines of merger by which there is the substitution of a new liability. The principles that are to be applied in considering cases of successive prosecutions in a court of summary jurisdiction are developed by analogy with the principles that govern the availability of pleas in bar in a court of record. They draw upon the values encompassed in the expression double jeopardy55. Secondly, and no less importantly, a conviction or acquittal in a court of summary jurisdiction will be explained and supported by reasons. The bases on which a court of summary jurisdiction has acquitted or convicted of a charge are thus ascertainable. That is not always so when there has been trial by jury. No doubt a jury's verdict of guilt is to be understood as expressing the jury's satisfaction, beyond reasonable doubt, of all of the elements of the charge. But a jury's verdict of not guilty is entirely unrevealing. The most that it can be taken as showing is that the jury was not satisfied beyond reasonable doubt that all of 52 Spencer Bower, Turner and Handley, The Doctrine of Res Judicata, 3rd ed (1996) 53 Hunter, "The Development of the Rule Against Double Jeopardy", (1984) 5 Journal of Legal History 3 at 14. 54 Ashe v Swenson 397 US 436 at 445 (1970). 55 See, for example, Flatman v Light [1946] KB 414 at 419. the elements of the relevant charge had been established. It will not reveal which element or elements were not established or why that was so. The inscrutability of a jury's verdict of not guilty may be a sufficient basis for considering the availability of a plea in bar to a later prosecution on a basis that would interpret the jury's verdict in the earlier case in the way that is most favourable to the accused. If that is done, the earlier verdict may be understood as yielding an estoppel or preclusion against proof of any of the elements of the charge of which the accused was acquitted. But if that is so, it would yield a rule that would allow a plea of autrefois acquit in any case where any of the elements of the first charge preferred against the accused was included in the elements of the second charge. The premises so far identified would not yield a rule confining autrefois acquit to cases where all the elements of the first charge preferred are included in the second charge. If the rule that is to be applied stems only from the inscrutability of a jury's verdict, and assumptions that are made about the jury's findings, the ultimate reason for such a rule would have no application in cases of summary prosecution. The rule to be applied in summary prosecutions is analogous to the rules governing the availability of the pleas in bar but it must be applied where the basis for the disposition of the former prosecution is ascertainable. Further, the history of the application of the pleas in bar reveals that the plea of autrefois acquit is not based only in the inscrutability of a jury's verdict of "not guilty". Rather, as is revealed by cases like Wemyss v Hopkins56, R v Elrington57, and, in this Court, Chia Gee v Martin58 and Li Wan Quai v Christie59, as well as the course of decisions in the Supreme Court of the United States60 about the application of the double jeopardy clause of the Fifth Amendment, the problem has always been seen as a more deep seated and complex question than may be answered by reference only to the inscrutability of a jury's verdict of not guilty. 56 (1875) LR 10 QB 378. 57 (1861) 1 B & S 688 [121 ER 870]. 58 (1905) 3 CLR 649. 59 (1906) 3 CLR 1125. 60 In particular, Ex parte Nielsen 131 US 176 (1889); Blockburger v United States 284 US 299 (1932); Brown v Ohio 432 US 161 (1977); Grady v Corbin 495 US 508 (1990); United States v Dixon 509 US 688 (1993). No doubt a plea in bar is available if the offence charged second is the same offence as was the subject of an earlier conviction or acquittal. But the pleas in bar are not confined to cases of identical charges. As was noted in Pearce61, Li Wan Quai expressed62 the relevant test (as did other earlier cases63) as being whether the first prosecution was for an offence "substantially the same" as the second offence charged. Expressing the test in this way presented further questions. In particular, what was meant by "substantially the same"? As the course of United States' decisions reveals64, to treat the test of "sameness" as requiring identity (or substantial identity) between the evidence that had to be led in support of the two charges produces a rule that is unstable in application. Rather, as the course of decisions in this Court, up to and including the decision in Pearce, reveals, the relevant test must be framed by reference to the elements of the offences under consideration. But recognising that the test of "sameness" requires examination of the elements of the two offences in question, rather than of the evidence that may be offered in proof of each, does not reveal the extent of the overlap that is to be required if the test is to be met. Rather, to identify the content of the test of "sameness" of two offences, when expressed by reference to the elements of those offences, it is necessary to consider the principles and values that underpin both the availability of a plea in bar of autrefois acquit and the application of an analogous principle in cases in summary jurisdiction. To confine autrefois acquit (and the analogous principle) to cases where all the elements of the first offence are elements of the second offence would treat the plea as no more than a species of preclusion. The preclusion would be confined to the elements of the first offence and would proceed from the assumption that the prosecution was to be taken to have failed to establish any of those elements. It would be a rule of preclusion closely analogous to, if not identical with, the principles of issue estoppel applied in civil cases. So to confine autrefois acquit, and the analogous principle, would entail the further conclusion that the preclusion thus provided was a sufficient satisfaction of the values of double jeopardy identified earlier – the public interest in finality, the avoidance of conflicting decisions (by accepting curial decisions as incontrovertibly correct), and the injustice to the individual of requiring relitigation. But those are values that are not met by treating autrefois acquit (or the analogous principle) as no more than a particular species of issue estoppel. 61 (1998) 194 CLR 610 at 616 [18]. 62 (1906) 3 CLR 1125 at 1131. 63 For example, Wemyss v Hopkins (1875) LR 10 QB 378 at 381 (the "same matter"). 64 Especially, Grady v Corbin 495 US 508 (1990) and United States v Dixon 509 US The applicability of principles of issue estoppel in criminal law has in the past been a matter of judicial and academic controversy both in Australia and elsewhere65. In Australia the question may now be regarded as settled by this Court's decision in Rogers66 in favour of the view that doctrines of issue estoppel of the kind developed in civil proceedings are not applicable to criminal proceedings67. Rather, it is the values embraced by the notions of double jeopardy that are to be reflected in the development of the criminal law. As Deane and Gaudron JJ said in Rogers68: "Issue estoppel would not only overlap with the plea of autrefois acquit and with the doctrines that have already developed, but its importation into the realm of criminal proceedings could well impede the development of coherent principles which recognize and allow for the distinct character of such proceedings. The preferable course, in our view, is to accept that the principles which operate in this area are fundamental and that the pleas and the developed doctrines relating to the unassailable nature of acquittals and the need for consistency may not exhaust their operation." The values embraced by notions of double jeopardy require that autrefois acquit and analogous principles are given no narrow operation. In particular, neither the plea in bar nor the analogous principle applied in summary jurisdiction is to be confined to precluding the prosecution from controverting one or more elements of an offence charged first where the elements of that first offence are wholly included in the second. To demonstrate why that is so, it is convenient to proceed by reference to an example. If an aggravated form of offence is charged first, and the accused is acquitted of that offence by a jury, it will not be possible to discern from that verdict whether the jury was not satisfied of one or more of the elements constituting the unaggravated offence, or was not satisfied of the element or elements of aggravation. (By contrast, in a court of summary jurisdiction, the 65 See, for example, Director of Public Prosecutions v Humphrys [1977] AC 1. 66 (1994) 181 CLR 251 at 254-255 per Mason CJ, 278 per Deane and Gaudron JJ. See also R v Storey (1978) 140 CLR 364 at 371-374 per Barwick CJ, 379-389 per Gibbs J, 400-401 per Mason J. Cf R v Wilkes (1948) 77 CLR 511; Mraz v The Queen [No 2] (1956) 96 CLR 62. 67 R v Carroll (2002) 213 CLR 635 at 662 [90] per Gaudron and Gummow JJ. 68 (1994) 181 CLR 251 at 278. basis for the acquittal can be identified from the reasons given.) May the accused be put at risk of conviction for the lesser, unaggravated, form of the offence at a subsequent trial? If autrefois acquit is confined to cases where all the elements of the first offence charged (and of which the accused has been acquitted) are elements of the second offence, the plea in bar would not be available. Yet because the jury's verdict of acquittal says nothing of why the jury acquitted, the verdict of not guilty of the aggravated offence is consistent with the jury having not been persuaded that all of the elements of the simple, unaggravated, offence had been established beyond reasonable doubt. That may be contrasted with the circumstances where the first charge is not determined by a jury. In such a case it would be known, from the reasons given for acquitting the accused of the first offence, whether the tribunal was not satisfied that the elements of the unaggravated offence had been established. Presumably, it would be accepted that, if one or more elements of the unaggravated offence was not established at the first trial, the prosecution should not be permitted to have a second opportunity to prove that lesser offence. But that is a conclusion that cannot be based on doctrines of issue estoppel similar to those applied in civil proceedings. First, as noted earlier, to apply such principles would be at odds with the state of the authorities in this Court. Secondly, and no less importantly, as R v Storey69 and Rogers demonstrate, there are insuperable difficulties in the way of treating a lack of satisfaction that a fact has been proved beyond reasonable doubt as establishing any proposition. Rather, the refusal to permit the prosecution to have a second opportunity to prove what was found not to have been established at an earlier trial is based in the need to maintain the incontrovertible character of that earlier decision. It may readily be accepted that the need to maintain the incontrovertibility of earlier decisions can be identified as an important root of the principles of issue estoppel that have been developed and are applied in civil proceedings. But in considering what are the principles that are to be applied in criminal proceedings, it is necessary to return to not only that particular root but also the other values which are encompassed by the notion of double jeopardy. It would be wrong to conclude the inquiry about the principles to be applied in the criminal law at the point of drawing some analogies with the separate principles of issue estoppel in civil litigation simply because those principles are seen to derive from one of the several roots that together are described as double jeopardy. 69 (1978) 140 CLR 364. Thus, what is revealed by the contrasting outcomes postulated by reference to the example given earlier, according to whether the first offence is tried by jury or tried summarily, is that to treat the plea of autrefois acquit as yielding no more than a form of issue estoppel does not give effect to all of the values embraced by the notion of double jeopardy. In particular, to treat an acquittal on one charge as barring a subsequent prosecution concerning the same events as founded that first charge only where all the elements of the first offence are included in the elements of the second offence not only would fail to accept that the earlier decision was correct, but also would require the individual to relitigate matters that the public interest requires be treated as finally determined. Statutory provisions permitting juries to find an accused person guilty of an offence, other than the offence charged, avoid many of the problems that might otherwise be thought to arise from giving autrefois acquit and analogous principles an operation that is not confined to precluding proof of the elements of the first offence only when those elements are all included in the elements of the second. Typically those provisions permit a jury considering one charge to find the accused not guilty of the offence charged but guilty of a less serious offence constituted by the conduct proved. An early example of such provisions is found in s 9 of the Criminal Procedure Act 1851 (UK) (14 & 15 Vict c 100) which permitted a jury to convict of an attempt when only the completed offence was charged. Provisions for alternative verdicts where certain sexual offences or property offences are charged have a long history70. More recently, the Criminal Procedure Act 1986 (NSW) makes detailed provision (Div 7 of Pt 3 of Ch 3, ss 165-169) for dealing with what that Act calls "back up offences" and "related offences". It is not necessary to consider these provisions in any detail. It is enough to notice that the Criminal Procedure Act 1986 provides that where an indictable offence is charged, the court may deal with offences that can be dealt with summarily and which arise from substantially the same circumstances as those from which the indictable offence has arisen or whose elements are necessary to constitute the indictable offence charged. What these various statutory provisions show is that, in very many cases, a prosecution for a lesser form of offence than the offence first charged will be barred, because the court or jury trying the first charge will have had to consider whether that lesser form of offence is established. It may be possible to discern some similarities between the approach reflected in the provisions of the Criminal Procedure Act 1986 and what has come to be known in the United States as a doctrine of "lesser included offences". This doctrine, traced to earlier New York legislation, was given 70 See now, for example, Crimes Act 1900 (NSW), ss 66E, 119-124. federal statutory effect in the United States in 1872 by An Act to further the Administration of Justice71. That Act provided: "That in all criminal causes the defendant may be found guilty of any offence the commission of which is necessarily included in that with which he is charged in the indictment, or may be found guilty of an attempt to commit the offence so charged".72 And for a time at least, it seems that a doctrine of lesser included offences was understood in the United States as a unifying principle informing the consideration of both what verdicts a jury might return on an indictment charging a particular offence, as well as questions about successive prosecutions73. Thus in Blockburger v United States it was held74 that "the test to be applied to determine whether there are two offenses or only one [for the purposes of the double jeopardy clause of the Fifth Amendment] is whether each provision requires proof of a fact which the other does not". Yet this test is often expressed in terms of lesser included offences. Thus in 1997 it was said75 that "a greater offense, under Blockburger, logically lesser-included offense with some but not all of the formal 'elements' of the greater offense". And as early as 1889, in Ex parte Nielsen, it was said76 that: the same as any treated as "[I]n order that an acquittal may be a bar to a subsequent indictment for the lesser crime, it would seem to be essential that a conviction of such crime might have been had under the indictment for the greater. If a conviction might have been had, and was not, there was an implied acquittal. But where a conviction for a less crime cannot be had under an indictment for a greater which includes it, there it is plain that ... an acquittal would not or might not be a bar". 71 Ch 255, s 9, 17 Stat 196 at 198 (1872). 72 This provision was replaced in 1946 by r 31(c) of the Federal Rules of Criminal Procedure. 73 Hoffheimer, "The Rise and Fall of Lesser Included Offenses", (2005) 36 Rutgers Law Journal 351. 74 284 US 299 at 304 (1932). 75 Amar, "Double Jeopardy Law Made Simple", (1997) 106 Yale Law Journal 1807 at 76 131 US 176 at 189-190 (1889). It would be wrong, however, to give too much emphasis to this conception of lesser included offences, or the procedural rules, rooted in statute, which may be seen as lying behind it, in deciding when a plea of autrefois acquit is available, or when the analogous principle should be applied. Apart altogether from the difference in context provided by the double jeopardy clause of the Fifth Amendment77, what is said in the American cases cannot be divorced from the application of the constitutional principle of collateral estoppel. That principle (that once a criminal defendant has prevailed against the government on an issue of ultimate fact, he should not be forced to continue to relitigate it criminally78) is also said to emerge from the double jeopardy clause of the Fifth Amendment rather than the due process clause of that Amendment79. It is neither necessary nor appropriate to reach any concluded view about whether that is so, or about the present state of the law of the United States on this subject more generally. In particular, it is not necessary to consider the validity of the criticisms that have been levelled80 against particular applications of the Blockburger test in the United States. What is important to notice about the United States law is, first, that the Blockburger test, which was adopted by the majority of this Court in Pearce, applies whenever all of the elements of one offence are included in the other, no matter the order in which the offences are charged. Secondly, references made in statutory provisions and in judicial and academic writings in the United States to "lesser included offences" are not to be understood as exhausting the application in the several jurisdictions of the United States of the values encompassed by double jeopardy. So, too, in Australia the values encompassed by double jeopardy require that the plea of autrefois acquit, and the analogous principle applied in summary jurisdiction, be available whenever all of the elements of one offence (of which an accused stands, or stood, in jeopardy) are included in the other offence of which that accused stands, or stood, in jeopardy, and that the plea be available, and the analogous principle applied, no matter the order in which the offences are 77 "[N]or shall any person be subject for the same offense to be twice put in jeopardy of life or limb". 78 Ashe v Swenson 397 US 436 at 446 (1970) quoting Green v United States 355 US 184 at 190 (1957): The Constitution "surely protects a man who has been acquitted from having to 'run the gantlet' a second time". 79 "[N]or be deprived of life, liberty, or property, without due process of law". 80 For example, by Professor Amar in the 1997 essay referred to earlier in these reasons – "Double Jeopardy Law Made Simple", (1997) 106 Yale Law Journal charged. The values embraced by double jeopardy are fundamental to the criminal law. It is those values that are reflected in the rule which was adopted in Pearce. In this case, the rule was not engaged, not because of the order in which charges were preferred, but because the appellants never stood in jeopardy of conviction for the offences first charged. Those charges were fatally defective. The appellants made the further submission that the institution and maintenance of the proceedings commenced by the second summonses (issued on 18 November 2003) was an abuse of process. The essence of the appellants' submission in this regard was that the second proceedings were oppressive. It was not altogether clear, however, whether the oppression was said to lie in there being successive prosecutions seeking to controvert an earlier acquittal, or was said to lie in the fact of successive prosecutions alone. To the extent that the appellants' submissions about abuse of process restated the contentions made about double jeopardy, they should be rejected for the reasons already given: the appellants were never put in jeopardy of conviction by the first summonses. To the extent that the appellants sought to make a separate point about abuse of process, it is sufficient to say only that to issue and maintain new proceedings in place of earlier, fatally defective, proceedings constituted no abuse of process. Questions of delay, and its consequences, though mentioned in argument, were not developed by counsel in a way that revealed any abuse of process in the present cases. No doubt there are cases in which delay in instituting proceedings may give rise to such unfairness that to continue the proceedings would constitute an abuse of process81. The appellants, however, pointed to no particular unfairness said to follow from the length of the period between the happening of the events in question and the institution of the second set of proceedings in the Land and Environment Court. It is, therefore, not necessary to explore this aspect of the matter further. Each appeal should be dismissed. 81 Jago v District Court (NSW) (1989) 168 CLR 23 at 28 per Mason CJ. Kirby KIRBY J. In these appeals from a judgment of the Court of Criminal Appeal of New South Wales82, two issues arise for decision by this Court. A third issue has been debated concerning what was said in Pearce v The Queen83. The facts, the applicable legislation and the arguments of the parties are set out in the other reasons84. There is no need for me to repeat them. This allows me to go directly to the questions for decision and to the one point upon which a difference of views has emerged in this Court. The two issues in the appeals The autrefois acquit issue: The first issue in these appeals is whether the second proceedings, by way of prosecution, brought against the master and owner of the ship "Pacific Onyx" ("the appellants"), for offences against the Marine Pollution Act 1987 (NSW) ("the Act") should have been dismissed in the courts below by the application of the principles of autrefois acquit. This was suggested because the appellants were thereby purportedly subjected to double jeopardy in the relevant sense, having earlier been put on trial for what they assert were the same, or "substantially the same"85, offences. This is the double jeopardy issue. It concerns the legal rights of the appellants and their entitlement to have the benefit of those rights. The abuse of process issue: The second issue arises if the first is determined against the appellants. It concerns whether, assuming that they are not entitled as of right to relief on the basis of autrefois acquit, the appellants are nonetheless entitled to protection against what they claim is the abuse of process involved in subjecting each of them to a second prosecution, the first having failed. The appellants allege that they were wrongfully exposed to prosecution in the earlier proceedings; that those proceedings were greatly delayed in their commencement; that they involved serious criminal charges and potentially heavy punishment upon conviction; that they were brought under incorrect and inapplicable provisions of the Act; that this subjected them to a lengthy and complex trial with the inevitable anxiety, costs and inconvenience that this 82 Island Maritime Ltd v Filipowski [2004] NSWCCA 453. 83 (1998) 194 CLR 610 ("Pearce") at 616 [18]. 84 Reasons of Gleeson CJ, Heydon and Crennan JJ at [17]-[18], [19], [31]; reasons of Gummow and Hayne JJ at [35]-[36], [39], [64]; reasons of Callinan J at [93]-[94]. 85 Pearce (1998) 194 CLR 610 at 645 [109] citing Li Wan Quai v Christie (1906) 3 CLR 1125 at 1131. Kirby involved; and that, those summonses having been dismissed and following still further inordinate and unexplained delay, they are now subjected, once again, to fresh criminal proceedings arising out of the same incident of maritime pollution that happened in Botany Bay, near Sydney, in November 1999. Against this conduct the appellants ask this Court to provide a permanent stay of proceedings, bringing their ordeal to a close. Autrefois acquit is not available The absence of legal jeopardy: My mind in these appeals has travelled along the lines explained in the reasons of Callinan J86. The double jeopardy issue must be resolved against the appellants for the technical reason that they were not, in law, subject to jeopardy in the first proceedings at all. I realise that, having been confronted with the prosecutorial power of the state, subjected to the full panoply of a criminal trial, apparently exposed (had they been convicted) to criminal punishment, and submitted to protracted anxiety, costs and inconvenience, it must have seemed to the appellants that they stood in jeopardy during the first trial. However, in law, they did not. The prosecution wrongly framed the charges. On those charges, the appellants could never have been lawfully convicted. They were never "in jeopardy" within the meaning of that phrase, as it applies to the doctrine of autrefois acquit87. Why this is so is explained, with reference to authority, in the joint reasons of Gummow and Hayne JJ88. On the face of the first summonses, the offences alleged against the appellants involved the "discharge of oil … into State waters, namely the waters of Botany Bay"89. Yet those offences were not available under the section of the Act, as charged. The appellants could have raised an objection to the charges immediately after the summonses were received. They could have moved at once to have those charges withdrawn or dismissed. For whatever reason, such a course was not taken. They faced their trial and were acquitted. Conclusion – no legal jeopardy: The fatal flaw in the charges meant that the appellants were not, therefore, "in jeopardy" of conviction of the first charges, as brought. At least, they were not in jeopardy of lawful conviction, assuming that the flaw was ultimately perceived by the prosecutor, the defence or 86 Reasons of Callinan J at [94]. 87 See Williams v Director of Public Prosecutions [1991] 1 WLR 1160 at 1170. 88 Reasons of Gummow and Hayne JJ at [37]. 89 Reasons of Gummow and Hayne JJ at [35]. Kirby by the court of trial or on appeal. Thus, technically, double jeopardy was not established in law. It follows that a plea of autrefois acquit was not available. In all of this, I agree in what is written by the other members of this Court. The courts below made no error in rejecting the claim to a right to acquittal of the second charges upon this ground. To this extent, the appeals fail. A permanent stay of proceedings is not appropriate The principles governing such stays: On the alternative claim for discretionary or quasi-discretionary relief90, on the basis that the second summonses amount to an abuse of process in criminal proceedings, entitling the appellants to protection in the form of stay orders from this Court, I confess to having more sympathy for the viewpoint stated by Callinan J91 than those of either Gleeson CJ, Heydon and Crennan JJ92; or Gummow and Hayne JJ93. In substance, whatever may have been the technical legal position on the pleas, the appellants were subjected to a serious and unnecessary ordeal. It entailed many of the practical features of double jeopardy. The reason why they were never, in law, exposed to "double jeopardy" is all very well. However, it might have counted for nothing if the parties and the courts below had failed to notice the unavailability of the nominated provisions of the Act to sustain the charges as laid (as, apparently, the prosecutor did initially). The provision of orders granting a permanent stay of criminal proceedings is a remedy that Australian courts have asserted in order to protect parties before the courts against a misuse or abuse of prosecutorial power, oppression by the organs of the state or subjection to a proceeding that would not amount, in the circumstances, to a real trial at all94. 90 See further Pearce (1998) 194 CLR 610 at 638 [93]. 91 Reasons of Callinan J at [96]. 92 Reasons of Gleeson CJ, Heydon and Crennan JJ at [31]-[32]. 93 Reasons of Gummow and Hayne JJ at [64]-[65]. 94 See discussion in Williams v Spautz (1992) 174 CLR 509 at 521; Jago v District Court of NSW (1989) 168 CLR 23 at 61; Rogers v The Queen (1994) 181 CLR 251 at 255-256. See also The Queen v Carroll (2002) 213 CLR 635 at 643-644 [22]- [23] per Gleeson CJ and Hayne J and 661 [86], where Gaudron and Gummow JJ outline further institutional justifications, the public interest in concluding litigation through final, binding and conclusive judicial determinations; and the need for orders of a court to be treated as correct, unless set aside or quashed. Kirby The facility may ultimately have a constitutional foundation, deriving from the implied powers of the integrated Judicature of the Commonwealth to protect its own processes from legislative or executive abuse or misuse. This much appears to have been in the minds of Gaudron and Gummow JJ in The Queen v Carroll95, where their Honours identified the interests involved as "fundamental to the ... nature of judicial power". It may also have been in the contemplation of the majority of this Court in Dietrich v The Queen96, in holding that the conduct of a "trial" of an accused who, through no fault of his or her own could not afford counsel, might be stayed permanently where serious criminal charges were involved or, at least, stayed until the accused was provided with appropriate legal representation. Analogous relief against proceedings that would amount to an abuse of process has also been upheld by this Court in non-criminal matters, including in the prosecution of greatly delayed disciplinary proceedings97, and even in civil proceedings involving a greatly protracted action for damages for alleged negligence98. However, whilst previous doubts about the availability and ambit of the power of the courts to provide such relief have been settled in Australia (laying at rest, for this country, the conflicting opinions expressed in the House of Lords in Connelly v Director of Public Prosecutions99), the ordering of such stays is still most exceptional. Basically, this is so because of the conception that we hold of the role of courts. It is a conception that lies deep in our constitutional history. It is reflected in the text and structure of the federal Constitution. Generally speaking, courts exist to quell the controversies brought to them by the parties100. Their powers, of their own initiative, to institute or terminate proceedings are exceptional. Such powers are kept in firm check101. Courts in 95 (2002) 213 CLR 635 at 661 [86]; Kirby, "Carroll, double jeopardy and international human rights law", (2003) 27 Criminal Law Journal 231 at 245. 96 (1992) 177 CLR 292 at 311, 326, 359, 362. 97 Walton v Gardiner (1993) 177 CLR 378. 98 Batistatos v Roads Traffic Authority of New South Wales [2006] HCA 27. 99 [1964] AC 1254 at 1361. See Pearce (1998) 194 CLR 610 at 648-649 [115]-[117]. 100 Hill v Van Erp (1997) 188 CLR 159 at 229; ASIC v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 638-639 [215]-[219]; Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 at 1003 [61]; 207 ALR 12 at 27. 101 As to criminal trials see R v Apostilides (1984) 154 CLR 563 at 575-576. Kirby this country are not, generally speaking, inquisitors. This is true of civil process. With even greater emphasis, it is true of criminal process. There, judges are repeatedly enjoined to respect the prosecutor's independent discretions102. Ordinarily, those discretions, if made within power, are exempt from judicial superintendence or interference. They generally belong, in our system of government, to the Executive, its agencies and officials, not to the judiciary which ordinarily keeps its distance from such decisions, just as it demands independence in the discharge of its own functions. These are not absolute rules. But in Australia these cases (both in criminal and civil proceedings) are acknowledged as exceptional103. including intervention, There may be a place, in the modern age, for some reconsideration of this doctrine within the constitutional division of judicial and executive functions104. The cost, duration and stress of litigation today may indicate a need for greater judicial in cases of seriously delayed, repeated, burdensome or oppressive litigation. However, no submissions were received in these appeals that challenged the established Australian law on this subject and its approach. When that approach is applied, it brings me (as it has brought the other members of this Court) to a conclusion that the appellants are not entitled, on conventional principles, to a stay of proceedings upon the second summonses. As has been said105, this is so despite the lamentable history that has proceeded, and accompanied, the prosecutor's second attempt to secure convictions of the appellants under the Act. Reasons for refusal of a stay: Some of the considerations that have informed my conclusion in this regard have already been stated in the reasons of the other members of this Court. Further reasons include: The considerable public importance of effectively protecting the marine environment of Australia, a vast land surrounded by waters vulnerable to devastating ecological, economic and other damage from oil pollution. 102 Barton v The Queen (1980) 147 CLR 75 at 94-95; R v Apostilides (1984) 154 CLR 563 at 571-575; Maxwell v The Queen (1996) 184 CLR 501 at 534, see also 513- 514; DPP (SA) v B (1998) 194 CLR 566 at 579-580 [21]; Dyers v The Queen (2002) 210 CLR 285 at 317 [88]; Mallard v The Queen (2005) 80 ALJR 160 at 180 [82]; 222 ALR 236 at 260. 103 See eg, Truong v The Queen (2004) 78 ALJR 473 at 491 [95]-[96], 497-498 [132]- [137]; 205 ALR 72 at 96, 104-106. 104 cf Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146 at 168. 105 Reasons of Gleeson CJ, Heydon and Crennan JJ at [4]. Kirby Effective protection requires the enforcement of specially enacted laws106. The offences alleged against the appellants are not, therefore, minor, routine or ordinary criminal offences. They have a significant public, environmental and governmental importance. They affect, potentially, very large natural concerns, substantial economic interests and many people; (2) A reflection of the importance of the law involved in this appeal may be found in the acceptance by the Commonwealth of Australia of obligations under the International Convention for the Prevention of Pollution from Ships, 1973107. Under that Convention, nation states assume obligations to enact laws prohibiting and sanctioning pollutive discharges (relevantly) from foreign ships within the jurisdiction of the states parties108. Inferentially, they accept obligations to prosecute those laws effectively not only in the interests of the states parties and their own marine environment but also in the interests of the international community as a whole; The specific inhibition that applies to the disturbance by courts of prosecutorial discretions involving the commencement of criminal proceedings, a powerful consideration in Australia, given the conventional rules that govern the making of such decisions in this society; The power of the courts, at least in this type of criminal prosecution, to order costs109 in favour of the accused where the acts or omissions of the prosecutor110 are shown to warrant that course; and 106 See reasons of Gleeson CJ, Heydon and Crennan JJ at [5]-[7]. 107 The International Convention for the Prevention of Pollution from Ships is Sched 1 to the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (Cth). A Protocol of 1978 amending the Convention is contained in Sched 2 to that Act. The Convention and Protocol are found in [1988] ATS 29 ("MARPOL 73/78, opened for signature 17 February 1978; entered into force 2 October 1983). 108 cf United Nations Convention on the Law of the Sea, opened for signature 10 December 1982 [1994] ATS 31 (entered into force 16 November 1994), Art 109 The proceedings in the Land and Environment Court of New South Wales included provisions for costs. See Filipowski v Island Maritime Ltd (2003) 124 LGERA 110 On 17 April 2002, the appellants' lawyers invited the prosecutor to withdraw the first summonses under s 27(1) of the Act, disclosing only that "the facts and circumstances of the incident do not fall within section 27 of the Act". Attention (Footnote continues on next page) Kirby The election by the appellants to proceed to trial on the first summonses without disclosing to the prosecution the fatal legal defect which was ultimately revealed at the trial. This defect appears to have been known to the appellants' lawyers well before the trial111. Conclusion – no error: It follows that the appellants also fail on the second issue. No error is shown in the way in which the courts below identified and evaluated the considerations relevant to the decision on this issue. The contested approach to multiple charges The difference within this Court: This leaves only the difference of opinion that has emerged in this Court concerning the respondent prosecutor's attack on an aspect of the reasoning in the joint reasons in Pearce112. The difference is expressed in the respective reasons of Gleeson CJ, Heydon and Crennan JJ113, on the one hand, and of Gummow and Hayne JJ114, with the concurrence of Callinan J115, on the other. Strictly speaking, this appeal can be decided by the Court without resolving this point of difference. This is so as the contested "rule" in Pearce was not engaged in this appeal, precisely because the charges in the original summonses were fatally defective. The appellants were not, therefore, in jeopardy of conviction on the offences first charged. Accordingly, no issue arises by reason of the particular order in which the respective charges were brought in the courts below. Nevertheless, as the other members of this Court point out, the issue is one of considerable practical significance for criminal procedure in Australia. There is a very real potential today for overlap between the contents of multiple was not further drawn to the legal defect but clearly it had been appreciated by those advising the appellants by that time. Whilst in criminal proceedings, disclosure was not required, its omission is relevant to the assessment of the consequential need for a second trial, relying on the legally applicable provisions of the Act. 111 See reasons of Gleeson CJ, Heydon and Crennan JJ at [23]. 112 See the reasoning in Pearce (1998) 194 CLR 610 at 616 [18], 624 [36]. 113 Reasons of Gleeson CJ, Heydon and Crennan JJ at [25]-[30]. 114 Reasons of Gummow and Hayne JJ at [38]-[40]. 115 Reasons of Callinan J at [95]. Kirby statutory offences of the same jurisdiction; common law offences and related statutory provisions applicable within a jurisdiction; as well as federal, State or Territory offences dealing in particular ways with what is generally the same subject matter116. The difficulty of resolving such issues and expressing rules for their resolution is ordinarily better left to a case in which the factual circumstances afford a hard instance in which to sharpen the appropriate principle. The values behind the double jeopardy rule: In so far as it is necessary, I express my agreement in the approach that Gummow and Hayne JJ have taken on this issue. I do so for several reasons. First, the approach that their Honours favour appears better adapted to affording a workable means of resolving future overlapping criminal charges in contemporary Australian society. The provision of a sensible common law solution is more likely to grow out of the "values" that the principles of double jeopardy and autrefois acquit were designed to secure. Secondly, the preferred approach shifts the focus of attention from purely technical issues of preclusion and criminal pleading to the more substantive considerations of the kind that, in Pearce117, I suggested ultimately lay behind the double jeopardy rule118. Thirdly, the approach has the advantage of bringing Australian law closer to the notions expressed in other major common law legal systems119. Fourthly, it also brings Australian law, in this regard, into closer harmony with the international law of human rights, and the provision that law makes for the rule against double jeopardy. The applicable principle is stated in Art 14.7 of the International Covenant on Civil and Political Rights120, as follows121: 116 Pearce (1998) 194 CLR 610 at 644-645 [107]. 117 (1998) 194 CLR 610. 118 (1998) 194 CLR 610 at 636-637 [89]-[91]. See also at 630 [73]. 119 See for example, Blockburger v United States 284 US 299 at 304 (1932) and subsequent cases concerned with the double jeopardy clause of the Fifth Amendment of the United States Constitution, discussed in Pearce (1998) 194 CLR 610 at 618-619 [27], 628-629 [62]-[66], 642-643 [104]. 120 International Covenant on Civil and Political Rights, opened for signature 16 December 1966, [1980] ATS 23 (entered into force 23 March 1976). 121 Joseph, Schultz and Castan, The International Covenant on Civil and Political Rights, 2nd ed (2005) ("Joseph") at 461. Kirby "No one shall be liable to be tried or punished again for an offence for which he has already been finally convicted or acquitted in accordance with the law and penal procedure of each country." There is a similar reflection of the international law principle ne bis in idem in the statute of the International Criminal Court122. The evolution of the rule: What began as a philosophical123 or religious124 rule in ancient times was developed by English legal procedures into a rule of criminal pleading and practice125. It is now in the process of further evolution: returning to a broad concern about "values" and individual rights. At this late stage, this process may not be capable of rescuing the technical law governing the pleas of autrefois acquit, autrefois convict or the innominate plea in bar described in Pearce126, having regard to the special features of the history of such pleas. However, attention to the deeper "values" that lie behind concerns over double jeopardy may yet have an impact upon fair prosecution practice127; stimulate the just conduct of the trial128; encourage attention to the need to avoid double punishment129 where the accused is convicted of several related offences; 122 Joseph at 461-462; cf van den Wyngaert and Stessens, "The International Non Bis in Idem Principle – Resolving Some of the Unanswered Questions", (1999) 48 International and Comparative Law Quarterly 779. 123 Pearce (1998) 194 CLR 610 at 630 [74], 647 [112]. 124 Pearce (1998) 194 CLR 610 at 630 [74] with reference to I Nahum 9. Saint Jerome drew from this passage the principle that God does not punish twice for the same act: Bartkus v Illinois 359 US 121 at 152 (1959) per Black CJ, Douglas J concurring. 125 Pearce (1998) 194 CLR 610 at 640-641 [99]-[101] with reference to Coke's Commentaries; Hale's Pleas of the Crown (1800) vol 2, Ch 31 at 245; Hawkins, Treatise of the Pleas of the Crown, 8th ed (1824), vol 2 at 516; cf R v O'Loughlin (1971) 1 SASR 219 at 240-241 per Wells J. 126 Pearce (1998) 194 CLR 610 at 646 [110]. 127 On prosecution practice in this context, see Pearce (1998) 194 CLR 610 at 638 128 On the fair conduct of a trial in this context, see Pearce (1998) 194 CLR 610 at 129 Pearce (1998) 194 CLR 610 at 649-650 [119]. Kirby and inform the consideration of a stay of further proceedings where, exceptionally, that course can be justified130. The approach that Gummow and Hayne JJ have adopted to the "values encompassed by double jeopardy", wherever all of the elements of one offence (of which an accused stands, or stood, in jeopardy) are included in the other offence (of which that accused stands, or stood in jeopardy) is closer to the approach that I favour, as expressed in Pearce. I would therefore endorse what their Honours have said in this case as a statement of the applicable Australian law. Future criminal practice and procedure should evolve by reference to the identified "values" that lie behind the universal double jeopardy rule. Further refinement and elaboration of this point must await cases in which it is actually presented for determination and application. Conclusion and orders A plea of autrefois acquit being unavailable, and an order for a permanent stay of the second summonses being inappropriate in this case, the trial of the appellants on the second summonses should proceed. Their appeals to this Court should be dismissed. 130 Pearce (1998) 194 CLR 610 at 648-649 [115]-[118]. Callinan CALLINAN J. As appears from the reasons of the other judges in these appeals, the respondent, inexplicably and without any apparent justification, more than two years after the relevant events, charged the appellants on summons with a contravention of s 27(1) of the Marine Pollution Act 1987 (NSW) ("the Act"). The matter proceeded to a full trial in the Land and Environment Court of New South Wales in which the respondent called all of its evidence. Talbot J, who was hearing the case summarily, dismissed the summons on 7 March 2003131. A further eight months elapsed, again inexplicably, before the appellants were charged on summons with a contravention of s 8 of the Act. As the judgment of Gummow and Hayne JJ holds, the appellants' plea of autrefois acquit was rightly rejected because the appellants were not, in the strict legal sense, "in jeopardy". This is so because the authorities to which other members of the Court have referred, state a rather narrow definition of "jeopardy". The defence requires, according to Dixon J in Broome v Chenoweth132 exposure to a "risk of a valid conviction" for the same, or perhaps substantially the same, offence. I say that the definition is a narrow one for the reason that defendants such as the appellants, having been charged effectively by a state authority, forced to prepare for a trial, and having been obliged to submit to proceedings in which all of the respondent's evidence was presented against them, would understandably be inclined to think that they had been in jeopardy. I will return to this matter when I deal with the appellants' argument that the second set of proceedings were an abuse of process. As to the principles applicable to a plea of autrefois acquit or convict, it is sufficient for me to say that I agree with the analysis of Gummow and Hayne JJ of the joint judgment in Pearce v The Queen133, with their Honours' conclusions with respect to it, and its application to these appeals. I have experienced much more hesitation about the other limb of the appellants' argument, that these proceedings constituted abuses of process. They were almost inexcusably belated in their commencement. The respondent chose the wrong charge initially. A defendant who chose to conduct a defence upon an erroneous legal basis would rarely, if ever, be given another chance. It is all very well to say that the appellants were not, in the first proceedings, at "risk of a valid conviction", but they still had all the anxiety, inconvenience, expense134 and pain 131 Filipowski v Island Maritime Ltd (2003) 124 LGERA 331. 132 (1946) 73 CLR 583 at 599 (emphasis added). 133 (1998) 194 CLR 610 at 612-624 [1]-[50] per McHugh, Hayne and Callinan JJ. 134 Talbot J reserved the question of costs: Filipowski v Island Maritime Ltd (2003) 124 LGERA 331 at 339 [42]. It is not apparent from the record whether the (Footnote continues on next page) Callinan of what must have seemed to them a real trial in which they were in jeopardy. It is also all very well to say that they could not have been validly convicted, but errors do occur, and not just at first instance. Experience tells that many litigants, assured by their advisers of a favourable outcome, but unsuccessful at first instance, lack the confidence, the resolve and the financial and emotional resources to pursue an appeal. In the end however, I have concluded that despite what has happened, the second proceedings do not constitute abuses of process. Something else, or perhaps more: greater delay, more obscurity in the language of the statutory provisions, an absence of bona fides by the respondent, or serious prejudice to the defendant, might have, taken with the other matters, constituted an abuse. It is not possible to state any comprehensive rule: each case must depend on its own facts. If I had concluded otherwise however, I would have exercised my discretion to grant a stay. For the reasons which I stated in Batistatos v Roads and Traffic Authority of New South Wales135 I do not think that the decision in House v The King136 would impose any inhibition on the exercise, on appeal, of that discretion accordingly. The appeals should be dismissed. appellants recovered their costs or not in those proceedings. In any event, the actual costs incurred are likely to have exceeded any recoverable costs. 135 [2006] HCA 27 at [223]. 136 (1936) 55 CLR 499.
HIGH COURT OF AUSTRALIA Matter No B26/2011 APPELLANT AND THE QUEEN Matter No B27/2011 RESPONDENT APPELLANT AND THE QUEEN RESPONDENT [2011] HCA 51 8 December 2011 B26/2011 & B27/2011 ORDER In each matter: Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland made on 23 December 2010 and in lieu thereof order that: the appeal to that Court be allowed; the appellant's convictions be quashed and sentences set aside; and (c) a new trial be had. On appeal from the Supreme Court of Queensland Representation P J Davis SC with G J D del Villar for the appellant in B26/2011 (instructed by Legal Aid (Qld)) M J Byrne QC with C L Morgan for the appellant in B27/2011 (instructed by Legal Aid (Qld)) W J Abraham QC with J G Renwick for the respondent in both matters (instructed by Commonwealth Director of Public Prosecutions) Interveners S J Gageler SC, Solicitor-General of the Commonwealth with G A Hill and R J Orr intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales with J K Kirk intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor (NSW)) W Sofronoff QC, Solicitor-General of the State of Queensland with A D Scott and A D Anderson intervening on behalf of the Attorney-General of the State of Queensland (instructed by Crown Law (Qld)) M K Moshinsky SC with C J Horan intervening on behalf of the Attorney- General for the State of Victoria (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Appeal – Jury misdirection – Application of proviso – Appellants in joint trial each convicted of multiple drug-related offences under Criminal Code (Cth) ("Code"), including two counts of importing commercial quantity of border controlled drugs into Australia contrary to s 307.1 of Code ("importation offences") – Trial conducted on mistaken assumption that guilt of importation offences could be established by proof that appellants parties to joint criminal enterprise – Whether prosecution upon basis not known to law denied application of proviso under s 668E(1A) of Criminal Code (Q) – Whether directions to jury on "group exercise" distracted from real issues in trial of each count in indictment. Words and phrases – "aids, abets, counsels or procures", "joint criminal enterprise", "proper conduct of trial", "proviso". Criminal Code (Cth), Ch 2, ss 11.2, 307.1. Criminal Code (Q), s 668E(1A). FRENCH CJ, GUMMOW, HAYNE, CRENNAN, KIEFEL AND BELL JJ. These appeals were heard together. The appellants were convicted, following their joint trial before the Supreme Court of Queensland (Applegarth J and a jury), of offences under the Criminal Code (Cth) ("the Code"), including two counts of importing a commercial quantity of border controlled drugs into Australia, contrary to s 307.1 of the Code ("the importation offences"). The trial was conducted on the mistaken assumption, shared by the parties and the trial judge, that guilt of the importation offences could be established by proof that the appellants were parties to a joint criminal enterprise to import the drugs into Australia. At the date of the appellants' trial, participation in a joint criminal enterprise was not a basis for the attachment of criminal responsibility respecting a substantive offence under the laws of the Commonwealth1. The appellants appealed against their convictions to the Court of Appeal of the Supreme Court of Queensland (Holmes JA, Fraser and White JJA concurring). The Court of Appeal found that the jury had been directed "in terms alien to the forms of criminal responsibility then recognised by the Criminal Code"2 and that the appellants' liability was accessorial3. Nonetheless, the Court of Appeal was satisfied that the appellants' guilt had been established beyond reasonable doubt. The Court of Appeal considered that the failure to direct the jury correctly as to the basis of the appellants' liability for the importation offences had not involved a fundamental departure from a trial according to law4. The appeals were dismissed under the proviso5. The appellants appeal by special leave upon a single ground that challenges the application of the proviso. One aspect of the ground raised a constitutional issue. The appellants submitted that the requirement of "trial by 1 Code, Ch 2. 2 R v Handlen (2010) 247 FLR 261 at 282 [72]. 3 R v Handlen (2010) 247 FLR 261 at 281-282 [70]-[71]. 4 R v Handlen (2010) 247 FLR 261 at 284-285 [82]. 5 Section 668E(1A) of the Criminal Code (Q) provides: "However, the Court may, notwithstanding that it is of the opinion that the point or points raised by the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred." Crennan Bell jury" for Commonwealth offences tried on indictment6 is inconsistent with the exercise of the power to dismiss an appeal under the proviso, at least in a case in which there has been a misdirection as to the elements of liability7. As these reasons will show, the prosecution of the appellants upon a basis that was not known to law was a departure from the proper conduct of the trial. The departure was fundamental. It denied the application of the proviso. This conclusion makes it unnecessary to address the appellants' constitutional arguments. The appeals should be allowed, the appellants' convictions quashed and a new trial ordered. Joint criminal enterprise and criminal responsibility under the Code At common law, two or more persons may be jointly criminally responsible for the commission of an offence which, tacitly or otherwise, they have agreed to commit and which is committed while the agreement is on foot8. As McHugh J explained in Osland v The Queen, the criminal responsibility of each participant in such an enterprise is direct, each being equally responsible for the acts constituting the actus reus of the crime9. Commonly, proof of the offence and the accused's participation in the joint enterprise is facilitated by the evidentiary rule sometimes inaccurately described as "the co-conspirator's rule"10. The rule is not confined to the prosecution of conspiracy offences. It applies in the prosecution of substantive offences in which it is alleged that two or more persons acted in preconcert to commit an offence11. The acts and declarations of all the participants to the joint criminal enterprise are admissible to prove the 6 Constitution, s 80. 7 See Weiss v The Queen (2005) 224 CLR 300 at 317-318 [46]; [2005] HCA 81; Cesan v The Queen (2008) 236 CLR 358 at 389 [99] per Gummow J; [2008] HCA 8 R v Lowery and King (No 2) [1972] VR 560; Glanville Williams, Criminal Law: The General Part, 2nd ed (1961) at 349. (1998) 197 CLR 316 at 343 [73]; [1998] HCA 75. 10 Gillies, The Law of Criminal Complicity, (1980) at 259-266. 11 Tripodi v The Queen (1961) 104 CLR 1 at 6-7; [1961] HCA 22. See also Cross on Evidence, 8th Aust ed (2010) at [33565]. Crennan Bell offence and the accused's participation in its commission12. The agreement or preconcert implies that each participant has authority to act in furtherance of the common purpose on behalf of all of the other participants13. In 1995, the Parliament codified all of the general principles of criminal responsibility applying to offences against the laws of the Commonwealth. The legislative history is discussed in R v LK14. The general principles are found in Ch 2 of the Code. The statement of them is exhaustive15. The Code has been amended since the date of the appellants' trial by the insertion of s 11.2A, providing for criminal responsibility in circumstances involving the joint commission of a substantive offence16. At the date of the appellants' trial, guilt of a substantive Commonwealth offence might have been established in one of three ways. First, by proof of the existence of the physical and any fault elements of the offence17. Secondly, by proof that the accused, while possessed of any fault element(s) of the offence, procured an innocent agent to engage in conduct constituting the physical element(s) of the offence18. Thirdly, by proof that the accused aided, abetted, counselled or procured another person to commit an offence19. The words "aids", "abets", "counsels" and "procures" are not defined in the Code. They have a long 12 The admission of the evidence is subject to reasonable evidence being adduced of the preconcert: Ahern v The Queen (1988) 165 CLR 87 at 99; [1988] HCA 39. See also Tripodi v The Queen (1961) 104 CLR 1 at 7. 13 Tripodi v The Queen (1961) 104 CLR 1 at 7; Ahern v The Queen (1988) 165 CLR 14 (2010) 241 CLR 177 at 203-206 [51]-[57] per French CJ, 220-224 [99]-[107] per Gummow, Hayne, Crennan, Kiefel and Bell JJ; [2010] HCA 17. 15 Code, s 2.1. 16 Crimes Legislation Amendment (Serious and Organised Crime) Act 2010 (Cth). 17 Code, s 3.2. 18 Code, s 11.3. 19 Code, s 11.2(1). Crennan Bell history in the law of complicity and are to be understood as having their established legal meaning20. Each is used to convey the concept of conduct that brings about or makes more likely the commission of an offence21. At no time has the Code adopted the distinction made by the common law in the case of felonies between the accessory before the fact, who counsels and procures the commission of the offence, and the accessory at the fact, who aids and abets the commission of the offence22. All who aid, abet, counsel or procure the commission of an offence against a law of the Commonwealth are taken to have committed that offence and to be punishable accordingly. The importation offences A person commits an offence contrary to s 307.1 of the Code if the person (i) intentionally imports or exports a substance; (ii) the substance is a border controlled drug and the person is reckless as to that circumstance; and (iii) the quantity of the substance imported or exported is a commercial quantity. The first importation offence took place in May 2006. A commercial quantity of border controlled drugs concealed in the cathode ray tubes of computer monitors was shipped from Vancouver to Brisbane. The second importation offence took place in September 2006. A commercial quantity of border controlled drugs concealed in the cathode ray tubes of computer monitors was again shipped from Vancouver to Brisbane. The drugs in each shipment consisted of cocaine, ecstasy23 and methamphetamine. Each is a border controlled drug24. The combined quantity of the drugs in each shipment was a 20 R v LK (2010) 241 CLR 177. 21 Giorgianni v The Queen (1985) 156 CLR 473 at 493 per Mason J; [1985] HCA 29, citing Cussen ACJ in R v Russell [1933] VLR 59 at 67. See also J C Smith, "Aid, Abet, Counsel, or Procure", in Glazebrook (ed), Reshaping the Criminal Law, 22 See Glanville Williams, Criminal Law: The General Part, 2nd ed (1961) at 353, 23 3,4-methylenedioxymethamphetamine (MDMA). 24 Section 300.2 of the Code defines "border controlled drug" to include a drug listed or described as a border controlled drug in s 314.4. Crennan Bell commercial quantity. At the time of these events, "import" was defined in the Code inclusively to mean "bring into Australia"25. It was not in issue in the Court of Appeal, or in this Court, that the importations were complete, at the latest, when the consignments were cleared through Customs and delivered to the consignee's warehouse26. Matthew Reed imported the drugs on both occasions27. The only basis upon which criminal responsibility could be fixed on the appellants for the importations was for aiding, abetting, counselling or procuring the commission of the offences by Reed28. Proof of guilt was dependent upon establishing, in the case of each appellant, that his conduct in fact aided, abetted, counselled or procured the commission of the offence by Reed29 and that he intended that his conduct would facilitate the commission of an offence of the type that Reed committed30. The indictment Following his arrest, Reed cooperated with the authorities and pleaded guilty to charges arising out of his role in the two drug importations. He gave evidence for the prosecution at the appellants' trial. An account of that evidence 25 Code, s 300.2, definition of "import". The definition has since been amended and now includes dealing with the substance in connection with its importation. 26 R v Handlen (2010) 247 FLR 261 at 273-274 [46]-[47], 281 [69], citing Campbell v The Queen (2008) 73 NSWLR 272 at 293-294 [124] per Spigelman CJ; R v Toe (2010) 106 SASR 203 at 224-225 [73]-[74], [77] per Bleby J; Bell v The Queen [1983] 2 SCR 471; R v Hancox [1989] 3 NZLR 60. 27 R v Handlen (2010) 247 FLR 261 at 276 [52]. 28 Code, s 11.2. 29 R v Handlen (2010) 247 FLR 261 at 281-282 [70]-[71]. 30 Provision is made in the Code for accessorial liability for the commission of a substantive offence in circumstances in which the person's conduct in fact aided, abetted, counselled or procured the commission of the offence by another and the person was reckless about the commission of the offence (including its fault elements) that the other person in fact committed: s 11.2(3)(b). Crennan Bell and the other evidence given at the trial, as summarised by the Court of Appeal, is set out below. Before turning to that summary, reference should be made to the remainder of the counts in the indictment. The appellant in the first appeal, Dale Handlen, was convicted of the possession of a commercial quantity of border controlled drugs that had been unlawfully imported into Australia31. This offence related to the possession of the drugs imported in the May shipment. Each of the appellants was also convicted of attempting to possess a commercial quantity of border controlled drugs that had been unlawfully imported into Australia32. These counts concerned the appellants' conduct in attempting to gain possession of the drugs that were imported in the September shipment. A third man, Kelsey Nerbas, was jointly charged with the same four counts as Handlen. Nerbas entered pleas of guilty to each count during the course of the trial. The evidence Reed, a Canadian citizen, worked for a computer recycling company in Vancouver. He said that he was introduced to Handlen in August 2005 by a colleague known as "TJ" and that the three of them discussed the possibility of exporting drugs to Australia, concealed inside computer monitors. Reed prepared costings for the warehousing and freight of a consignment of computer monitors at Handlen's request. Thereafter, he arranged for the purchase of 480 monitors using funds provided by Handlen. In January 2006, Reed, Handlen and TJ leased a warehouse in the name of Cyberdesk, a legitimate business that was operated by TJ ("the Cyberdesk warehouse"). The monitors were delivered to the warehouse and, in March 2006, Reed, Handlen and TJ met there to pack the drugs inside the cathode ray tubes of selected monitors. The appellant in the second appeal, Dennis Paddison, and his father-in-law assisted in this task. In early April 2006, Reed and Handlen flew to Brisbane. The tickets were booked by Reed with money given to him by Handlen. Reed was on friendly terms with Nerbas, a Brisbane resident. At Reed and Handlen's instigation, Nerbas arranged for the registration of a company, Reliable Computer Conversions Pty Ltd ("Reliable"), of which he and Reed became directors. Reliable was to be the consignee of the shipment of monitors. Nerbas and Reed were each signatories to Reliable's bank account. They signed a lease for a 31 Code, s 307.5. 32 Code, ss 11.1, 307.5. Crennan Bell warehouse located in Geebung ("the Geebung warehouse"). Nerbas paid the security deposit and rent for the warehouse. There was evidence that moneys had been transferred from accounts associated with Paddison to an account operated by Nerbas in May 2006. Reed organised to have the monitors collected in Vancouver, placed in a container and shipped to Brisbane. He engaged customs brokers in Brisbane, providing them with the bill of lading and an invoice from Cyberdesk addressed to Reliable for the consignment. Handlen gave Reed the name of a union official, who he said might facilitate the process of clearing the consignment through Customs. Reed made contact with this individual. In due course, the consignment was cleared and delivered to the Geebung warehouse. Handlen, Reed and Nerbas removed the monitors from the container and stored them in the Geebung warehouse. About a week later, they returned and removed the drugs from the monitors. Handlen placed some samples of the drugs in a shopping bag and took it back to the unit in which he and Reed were staying. Handlen later gave a sample of the drugs to a man named John. Handlen told Reed that he had another client who would collect the remaining samples. These were collected by a man named David Shen. A few days later, Reed, Handlen and Nerbas returned to the warehouse, collected the remaining drugs and hid them in an apartment rented by Reed. Handlen arranged for most of these drugs to be picked up by certain men, including two of Shen's employees, and disposed of the remainder himself over time. Evidence of the unpacking of the drugs and the subsequent dealings with them was relevant to the possession count against Handlen. As the Court of Appeal noted, this evidence does not appear to have been relevant to the case against Paddison33. Its admission was the subject of complaint in the Court of Appeal. The ground of challenge was dismissed since Paddison's counsel had not objected to the evidence and the trial judge summed-up on the evidence only as it related to the count of possession against Handlen34. Handlen and Reed returned to Vancouver in mid-June 2006. At Handlen's suggestion, in late July 2006, a second shipment of monitors was sent to 33 R v Handlen (2010) 247 FLR 261 at 287 [94]. 34 R v Handlen (2010) 247 FLR 261 at 287 [94]. Crennan Bell Brisbane. There were no drugs concealed in this shipment. The purpose of sending an untainted consignment of monitors was to deflect any suspicions entertained by Customs officers. Reed arranged for a third consignment of monitors to be shipped to Brisbane in early August 2006. On this occasion, the monitors were stored in the garage at Paddison's home before being transported to the Cyberdesk warehouse. Reed saw Handlen opening a package that appeared to contain cocaine at Paddison's home. He next saw the monitors loaded and taken from Paddison's home to the Cyberdesk warehouse. Reed, Paddison and a friend of Paddison's unloaded the monitors at the warehouse, stacking them on pallets. On 10 August 2006, Reed flew to Brisbane, using money given to him by Handlen. At Handlen's suggestion, he and Nerbas rented premises in which to store the monitors that had been used to hide the drugs in the first shipment. Also at Handlen's suggestion, Reed and Nerbas met Shen, from whom they collected money. Paddison flew to Brisbane on 4 September 2006. He helped Reed unload the monitors from the second "dummy run" shipment. Handlen arrived in Brisbane on 6 September 2006 and attended a meeting with Shen. On 8 September 2006, Customs officers examined the third shipment and found drugs concealed in one of the monitors. They contacted the Australian Federal Police, who examined the entire consignment, removed the drugs and replaced them with packages containing a harmless substance. The police commenced a surveillance operation, which included intercepting and recording telephone calls made by Reed, Nerbas and the appellants. Reed retained customs brokers to secure the clearance of the third consignment and its delivery to the Geebung warehouse. Handlen supplied him with the money to pay the brokers. The container was delivered to the Geebung warehouse on the morning of 18 September 2006. Around midday that day, Reed and Paddison went to the warehouse, opened the container and observed that its contents were disordered. Reed telephoned Handlen, saying that they were "just in the middle of work here … I don't like it". That evening, Shen rang Handlen. Handlen told Shen that "they" had gone "through it with a … fine tooth comb" but that it was a "clean bill of health". On 20 September 2006, Reed and Paddison returned to the Geebung warehouse to unpack the drugs. Their activities inside the warehouse were recorded by a surveillance camera. The recording was of poor quality, but tended to confirm Reed's account that they had unscrewed the casing of one of Crennan Bell the monitors, and that Paddison had looked inside it and shaken his head. They left the warehouse immediately and were arrested shortly after. Handlen was arrested later that evening. Handlen had an email in his pocket from Reed advising details of the ship and the container. The police took possession of the monitors from the first shipment. Paddison's fingerprint was found inside the outer casing of one of the monitors. A packet of tablets, apparently overlooked, was found in another monitor. Handlen did not give evidence. Paddison gave evidence denying that he knew that drugs were concealed in the monitors. He claimed that the bank records purporting to relate to his account were false and that the recordings of telephone conversations to which he was a party were edited. He said that he had accompanied Handlen on the trip to Australia for a holiday at a time when he was attempting to overcome his addiction to heroin. The conduct of the trial The prosecution case was opened on the basis that guilt was to be established by proof that each appellant was a party to a joint criminal enterprise in which each was responsible for the acts which together constituted the physical elements of the importation offences. The Crown Prosecutor told the "In cases such as the present where the importations are large, no one person can do all that is necessary to achieve the importation. Here there were many tasks directed towards the importation of the drugs, and the performance of the tasks was divided amongst the participants. In short, each importation was a group exercise with each participant sharing the common objective of bringing drugs into the country." The characterisation of the prosecution case as involving proof of a "group exercise" appears to have raised a question in the mind of at least one member of the jury. During the Crown case, the jury asked a question36: 35 R v Handlen (2010) 247 FLR 261 at 270 [32]. 36 R v Handlen (2010) 247 FLR 261 at 270 [33]. Crennan Bell "Can you please clarify the defendants are linked by association; do we take this into account?" The jury's question did not prompt consideration by the Crown Prosecutor or defence counsel of the significance, if any, of the association between the appellants to proof of their liability for the importation offences. The Crown Prosecutor proposed that the question be answered in this way37: "The Crown case is, and has always been, one of joint enterprise, so that evidence which tends to associate all defendants with the matters charged is evidence that they can take into account." When the jury returned, the trial judge answered their question consistently with his acceptance of the Crown Prosecutor's submission. He said38: "[T]he Crown's case is that there was an association between the defendants and that association is relevant to the offences with which they've been charged. The Crown's case is that each importation was a group exercise with each defendant sharing a common objective of bringing drugs into the country. As was opened by the prosecutor, the Crown's case is that tasks were divided, but there was a common objective of bringing drugs into the country, and so to answer your question, evidence of association is something that you do take into account." The appellants were each represented by counsel throughout the Crown case. Neither counsel objected to the form of the direction given in answer to the jury's question. Evidence was admitted, without objection, of the acts and declarations of persons occurring outside the presence and hearing of the appellant against whom they were tendered in order to prove the existence and scope of the group exercise. Handlen withdrew his instructions to his counsel following the close of the Crown case on the 11th day of the trial. Paddison withdrew his instructions to his counsel when he was under cross-examination by the Crown Prosecutor on 37 R v Handlen (2010) 247 FLR 261 at 270 [33]. 38 R v Handlen (2010) 247 FLR 261 at 270 [33]. Crennan Bell the 15th day of the trial. Thereafter, the appellants were unrepresented for the remainder of the trial. In his closing address, the Crown Prosecutor invited the jury to find that the appellants had imported the drugs on each occasion "in partnership with each other, with Reed and others such as the man TJ and perhaps Tom, the other man from Canada whose name you've heard mentioned"39. The directions In summing up the prosecution case, the trial judge explained to the jury: "The prosecution alleges that the defendants and others were part of a group exercise with each participant sharing the common objective of bringing drugs into the country." His Honour directed that the prosecution was required to prove that each appellant "imported the substance and that he intended to import the substance". With respect to the first importation, his Honour directed: "[W]as there an importation of a commercial quantity of border controlled drugs in May 2006? There seems to be no dispute about that. If there was, was it the result of a group exercise? Again, there is a lot of evidence to that effect. Critically, if it was a group exercise, who were the participants in that group exercise? Has the prosecution proven that Mr Handlen, with others, imported the drugs that arrived in May and intended to do so? Has the prosecution proved that Mr Paddison, with others, imported the drugs that arrived in May because he packed them and transferred moneys to assist with expenses and therefore intended to import the drugs?" (emphasis added) With respect to the second importation, his Honour directed: "Was there an importation of commercial quantities of border controlled drugs in September 2006? Clearly the evidence is that there was. Was it the result of a group exercise? Well, you would readily conclude that it 39 R v Handlen (2010) 247 FLR 261 at 270 [34]. Crennan Bell was. Critically, who were the participants in that group exercise? Has the prosecution proven that Mr Handlen, with others, imported the drugs that arrived in September and intended to do so? Has the prosecution proved that Mr Paddison, with others, imported the drugs that arrived in September because he helped pack them and intended them to be brought into Australia?" (emphasis added) With respect to the use to be made of the evidence led to prove the existence of the group exercise, his Honour directed: "You have heard evidence of acts done and things said by people, such as Mr Reed and Mr Nerbas, out of the presence and hearing of one or both of the defendants. The prosecution says that the acts and the statements of Mr Reed and Mr Nerbas were in furtherance of the agreed common purpose and go to establish the existence of the group exercise that is alleged and each defendant's guilt of the offences with which they have been charged. If you are satisfied the acts and things alleged were done or said by other participants in such a plan and were done or said in furtherance of the agreed common purpose, you may use this evidence in deciding whether the prosecution has proved beyond reasonable doubt that the defendant committed the offence with which he has been charged. You must be satisfied of the existence of the group exercise in which each participant shared the common objective and that the defendant was a participant in The prosecution relies on acts done and statements made by people such as Mr Reed and Mr Nerbas out of the presence and hearing of one or both of the defendants. That evidence can be relied upon by the prosecution to persuade you of its case, about the nature of the enterprise, and that, as part of that enterprise, an importation of drugs took place. … It may, along with other evidence, prove that there was a group exercise to import drugs and take possession of them after they had been imported but not prove the participation of the defendant. However, it may prove both the fact of the group exercise and the participation of the defendant." (emphasis added) Crennan Bell With respect to the recordings of telephone conversations, his Honour directed: "If the defendant was not a participant to the conversation, then you need to consider whether the conversation was in furtherance of the agreed common purpose that the prosecution alleges, and thereby establishes the existence of the group exercise and whether it, along with other evidence, proves the defendant's guilt of one or more of the offences with which he has been charged. So consider the contents of each of the statements that the prosecution relies on to prove the case against the defendants; namely that the defendants and others were part of a group exercise, and decide whether it proves the group exercise and whether it proves that the defendant was a participant in that group exercise." (emphasis added) Evidence that Nerbas conducted internet searches on topics including "Australian Customs drug bust", "drug bust in screens" and "Customs drug bust monitors" was left as capable of proving "the group exercise". So, too, was evidence that Nerbas and Reed visited a spyware shop, where they inquired about anti-surveillance equipment. Proof of the existence of the group exercise to import drugs into Australia was irrelevant to proof of the appellants' guilt. No directions respecting proof of accessorial liability under s 11.2 of the Code were given. The Court of Appeal It was not in issue in the Court of Appeal that the common law doctrine of joint criminal enterprise had no analogue in the Code at the time40. The Court of Appeal rejected the respondent's submission that the appellants were each principals having performed part of the conduct involved in the importation offences41. That contention was not advanced in this Court. 40 R v Handlen (2010) 247 FLR 261 at 277-281 [55]-[67]. 41 R v Handlen (2010) 247 FLR 261 at 277 [55], 280-281 [65]-[66]. Crennan Bell The Court of Appeal concluded that the case against the appellants was "extremely strong"42. It observed that Reed's evidence had been "amply supported" by other evidence, including of travel arrangements, transfer of moneys, recordings of telephone conversations, surveillance evidence and, in the case of Paddison, fingerprint evidence43. The Court of Appeal was mindful that satisfaction that the case against the appellants was established beyond reasonable doubt was a necessary, but not sufficient, condition for the application of the proviso44. The Court of Appeal approached consideration of the proviso by observing, correctly, that not every misdirection relating to the elements of the offence will necessarily amount to a fundamental flaw in the trial45. It characterised the misdirection as the trial judge's "failure to frame the question of criminal responsibility in terms of aiding under s 11.2"46. The Court of Appeal "As the case was put on the basis of a group exercise in which each appellant performed tasks, the jury could not have understood the necessary intention to import as an intention to single-handedly bring the drugs into the country; they can only have understood the requisite intent as being the intention of each appellant to perform his allotted tasks in the exercise with the understanding that he was doing so in order to accomplish the importation of drugs. The intention which must have been found by the jury was, in this context, equally capable of being characterised as an intention to aid in the importation, even if it was not described as that by his Honour." 42 R v Handlen (2010) 247 FLR 261 at 282 [72]. 43 R v Handlen (2010) 247 FLR 261 at 282 [72]. 44 R v Handlen (2010) 247 FLR 261 at 282 [72]. 45 R v Handlen (2010) 247 FLR 261 at 283 [77], citing Krakouer v The Queen (1998) 194 CLR 202; [1998] HCA 43 and Darkan v The Queen (2006) 227 CLR 373; [2006] HCA 34. 46 R v Handlen (2010) 247 FLR 261 at 282 [72]. 47 R v Handlen (2010) 247 FLR 261 at 284 [81]. Crennan Bell Discussion The vice in the trial was not that the trial judge failed to direct the jury that the requisite intention was an intention to aid as distinct from an intention to single-handedly import the drugs. The vice was in prosecuting the case against the appellants as one of joint criminal enterprise and in framing the issue for determination as whether the prosecution had proved that the appellants were parties to the group exercise to import the drugs. The Court of Appeal's analysis proceeded on the assumption that the "evidentiary content of the Crown case" was unaffected by the misconception as to the basis of the appellants' criminal responsibility. The Court of Appeal said that the Crown Prosecutor was "entitled to lead evidence of the acts and statements of all accused in furtherance of the common purpose of importation on the Tripodi principle"48. The evidence that the Crown Prosecutor was entitled to lead in the case against each appellant was evidence tending to establish (i) the commission of the importation offences by Reed; (ii) the conduct of the appellant that aided, abetted, counselled or procured the commission of the offences; and (iii) any fact or circumstance from which it was open to infer that the appellant had the intention, in engaging in the conduct, to assist Reed in the commission of offences of this type. There was no objection to the admission of evidence of the acts and statements of persons taking place outside the presence and hearing of the appellant against whom they were tendered to prove the existence of the group exercise. This may be explained by the circumstance that defence counsel shared the Crown Prosecutor's mistaken understanding as to the basis of criminal responsibility for the importation offences. An appreciation of the true basis of any criminal responsibility might be expected to have prompted consideration of the admissibility of evidence of matters such as the internet searches carried out by Nerbas and his and Reed's visit to the spyware shop. It is not correct to say that the Crown Prosecutor was "entitled" to lead evidence to prove the existence of the group exercise. However, given the lack of objection, the appellants' complaint is not with the admission of the evidence but with the directions that are set out above as to the use that the jury might make of it. 48 R v Handlen (2010) 247 FLR 261 at 282 [72]. Crennan Bell The question of whether the appellants were parties to the group exercise obscured the requirement to prove that each appellant engaged in conduct that in fact facilitated the commission of the importation offences by Reed. The case against Paddison for the September importation illustrates the point. Paddison's conduct that might be relied upon as aiding in the commission of the offence was his assistance in packing the drugs in the monitors, knowing that they were border controlled drugs and knowing that Reed was intending to import them into Australia. Proof of this conduct depended upon acceptance of Reed's evidence. Although the trial judge did refer in terms to Paddison's help in packing the drugs in his directions relating to the September importation, he did not direct that satisfaction that Paddison engaged in this conduct was essential to proof of guilt. In the way the matter was left, Paddison's guilt depended upon proof that he was a party to the group exercise to import the September shipment. The jury might have reasoned from the evidence of his visit to the warehouse on 20 September 2006 and from the things that he said in telephone conversations that he was a party to the group exercise. That evidence was capable of supporting acceptance of Reed's account; however, it was not evidence of conduct that aided, abetted, counselled or procured the importation of the drugs by Reed. The importation was complete by the time the surveillance of the members of the group commenced. It cannot be assumed that the jury's verdict reflected satisfaction beyond reasonable doubt that Paddison engaged in conduct that facilitated the commission of the offence. As this Court explained in Weiss v The Queen, there is no single universally applicable description of what constitutes a "substantial miscarriage of justice"49. The appellants were convicted of serious criminal offences50 following a trial at which the prosecution case was conducted, and left to the jury, on a basis for which the law did not provide. The conduct of the trial on 49 (2005) 224 CLR 300 at 317 [44] (emphasis in original). See also Cesan v The Queen (2008) 236 CLR 358 at 386 [89] per French CJ, 391 [107] per Gummow J, 393-395 [123]-[129] per Hayne, Crennan and Kiefel JJ. 50 The offence of importing a commercial quantity of border controlled drugs into Australia under s 307.1 of the Code has a maximum penalty of imprisonment for life or 7,500 penalty units or both. Handlen was sentenced to life imprisonment with a non-parole period of 22 years. Paddison was sentenced to 22 years' imprisonment with a non-parole period of 14 and a half years. Crennan Bell this basis conferred an evidentiary advantage on the prosecution, leading to the admission of evidence to prove the existence and scope of the group exercise. Ultimately, the issue posed for the jury was whether the prosecution had proved that the appellants were parties to the group exercise when this was irrelevant to proof of their complicity in Reed's offences. The verdicts on the importation counts reflect the jury's satisfaction that each appellant was a party to the group exercise but it does not follow that the jury must have been satisfied of the facts necessary to establish the appellants' guilt of the importation offences in the only way for which the law allowed. It was not open to the Court of Appeal to apply the proviso in the circumstances of these appeals. The remaining counts The appellants submitted that the repeated references to proof of the group exercise affected the fairness of their trial on the other counts. As noted above51, these were, in the case of both appellants, a count of attempted possession contrary to s 307.5 of the Code and, in the case of Handlen, a further count of possession, also contrary to s 307.5. The respondent submitted that, since the elements of the offences of possession and attempted possession of border controlled drugs had been correctly explained to the jury, no basis for setting aside the convictions for these offences was demonstrated. The directions concerning proof of the "group exercise" did not discriminate between proof of guilt of the importation offences and the other counts in the indictment. The direction respecting the use to be made of the evidence of the acts and statements of Reed and Nerbas in furtherance of the "agreed common purpose", set out above, was expressed to be with respect to proof of each appellant's guilt of the offences with which he was charged. His Honour characterised the group exercise as "to import drugs and take possession of them after they had been imported". The direction as to the use that might be made of the recordings of conversations of other participants in the group exercise, also set out above, was with respect to proof of guilt of "one or more of the offences" with which the appellants were charged. His Honour referred to five telephone conversations by way of example and went on to say: "What I've done by taking you just to the first five of those transcripts is to identify conversations in which either one or both of the defendants wasn't 51 See [10] of these reasons. Crennan Bell a participant. As I've indicated, the prosecution says that the acts and statements of Mr Reed and Mr Nerbas were in furtherance of the agreed common purpose, and go to establish the existence of the group exercise that it alleges and also goes to each defendant's guilt of the offences with which they have been charged." (emphasis added) The jury were directed that it was the prosecution case that Nerbas' internet searches were carried out "to further the alleged common purpose of gaining possession of the drugs". His Honour explained that it was open to infer that Nerbas was a party to a plan which had the common purpose of taking possession of the drugs. The directions which focused on the irrelevant issue of proof of the existence of, and the appellants' participation in, the "group exercise" distracted from the real issues in the trial of each count in the indictment. The appeals should be allowed and the appellants' convictions for each offence quashed. The appellants accepted that the appropriate consequential order is to direct a new trial52. Orders The following orders should be made in each appeal: Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland made on 23 December 2010 and in lieu thereof order that: the appeal to that Court be allowed; the appellant's convictions be quashed and sentences set aside; and a new trial be had. 52 Cf R v Taufahema (2007) 228 CLR 232; [2007] HCA 11. HEYDON J. In these ill-starred proceedings, the first matter to consider relates to the convictions of each appellant on two charges of importing drugs. The Court of Appeal of the Supreme Court of Queensland decided that "the case was advanced and left to the jury in terms alien to the forms of criminal responsibility then recognised by the Criminal Code [(Cth) ("the Code")]."53 By that the Court of Appeal meant that the case on the importation charges had been put by the prosecution without protest from the defence or the trial judge as if the common law doctrine of "joint criminal enterprise" applied. In fact it did not. The Court of Appeal held that in May and September 2006, when the two importations of drugs took place, the only law which could result in the conviction of the appellants was s 11.2 of the Code. That meant that neither appellant could be convicted unless there was proof that he had aided, abetted, counselled or procured the commission by Reed of the offence of importing drugs contrary to s 307.1 of the Code. These reasons proceed on the assumption that the Court of Appeal's holding is correct. The appellant in the first appeal will be called "the first appellant", and the appellant in the second appeal will be called "the second appellant". Inadmissible evidence? One point must be put aside at the outset. No ground of appeal was advanced to the Court of Appeal or to this Court contending that evidence was admitted against the appellants in defiance of the principles stated in Ahern v The Queen54. Nor was any objection of that kind taken at trial. Any objection and any ground of that kind would have failed, because the principle on which the acts and declarations of others outside the presence of an accused person may be received extends beyond cases of conspiracy55. Thus in Tripodi v The Queen, a larceny case not involving any charge of conspiracy, Dixon CJ, Fullagar and Windeyer JJ said56: "When the case for the prosecution is that in the commission of the crime a number of men acted in preconcert, reasonable evidence of the preconcert must be adduced before evidence of acts or words of one of the parties in furtherance of the common purpose which constitutes or forms an element of the crime becomes admissible against the other or others". 53 R v Handlen (2010) 247 FLR 261 at 282 [72]. 54 (1988) 165 CLR 87; [1988] HCA 39. 55 Ahern v The Queen (1988) 165 CLR 87 at 99. 56 (1961) 104 CLR 1 at 7; [1961] HCA 22. This case does not involve a conspiracy, but s 11.2 when applied to the factual allegations in these proceedings does mean that the case for the prosecution in relation to the importation charges was that "a number of men acted in preconcert". That is, if there were aiding, abetting, counselling or procuring, it can only have arisen by reason of preconcert. But even if the last paragraph is incorrect, these appeals can justly turn only on issues to do with misdirection, in view of the failure to object to evidence at trial and the absence of the necessary grounds of appeal. Jury direction The terms of s 11.2. The relevant parts of s 11.2 are as follows: "(1) A person who aids, abets, counsels or procures the commission of an offence by another person is taken to have committed that offence and is punishable accordingly. For the person to be guilty: the person's conduct must have in fact aided, abetted, counselled or procured the commission of the offence by the other person; and the offence must have been committed by the other person. For the person to be guilty, the person must have intended that: his or her conduct would aid, abet, counsel or procure the commission of any offence (including its fault elements) of the type the other person committed; or The issues raised by s 11.2. The jury had to be satisfied that, and had to be directed in language turning their minds to the question whether, three conditions existed. The first is that provided for in s 11.2(2)(a). The second is that provided for in s 11.2(2)(b). The third is that provided for in s 11.2(3)(a). It was not in issue that the second condition (s 11.2(2)(b)) was satisfied: the appellants did not cross-examine Reed to suggest that his evidence of having committed offences was wrong. Further, the Court of Appeal concluded that the jury findings must have rested on a conclusion that the intention of each appellant answered s 11.2(3)(a), and this is not in issue. So the third condition is not controversial. What is controversial is the first condition – whether the judge's directions made it clear that the jury had to be satisfied beyond reasonable doubt that each appellant had aided, abetted, counselled or procured the commission of Reed's offence – that is, had brought that offence about or made it more likely. The Court of Appeal described this issue as being whether each appellant "did things to advance the importation of drugs into Australia"57. That description, as a description, was not attacked as erroneous. It is noteworthy that the appellants did not submit that, if the jury had been directed in terms of s 11.2, the evidence was insufficient to support the convictions on the importing charges. The submissions advanced on behalf of the appellants tended to obscure the simplicity of the problem by saying that the jury was wrongly directed about every factual ingredient and that "the jury was never asked to determine the facts that would establish [accessorial] liability." Was it correct for the appellants to submit that the jury was never asked to determine the facts described in s 11.2(2)(a)? No. The case against the second appellant. The prosecution case against the second appellant was that he packed drugs in Canada by cutting into cathode ray tubes in computer monitors, placing packages of drugs in them, and resealing them; that he had unloaded the monitors in Australia; that he examined them with a view to removing the contents; and that in April and May 2006 he made payments to assist the first appellant and Reed while they were in Australia. The directions about the second appellant. The trial judge directed the jury in a manner conforming to that case. The trial judge said that the prosecution case in relation to each importation was that "no one person can do all that is necessary to achieve the importation, [and] there were many tasks that had to be performed and divided between the various participants." Although the judge was not thinking in s 11.2 terms, that remark told the jury that each appellant's conduct had to be examined to see how it advanced the importation – had brought it about or made it more likely – and thus how it aided, abetted, counselled or procured it. Then the trial judge said a question for the jury in relation to the May 2006 importation was: "Has the prosecution proved that [the second appellant], with others, imported the drugs that arrived in May because he packed them and transferred moneys to assist with expenses and therefore intended to import the drugs?" To pack the drugs and to transfer the monies were acts bringing about the commission of Reed's offence or making it more likely – they were acts capable of supporting the conclusion of aiding, abetting, counselling or procuring. 57 R v Handlen (2010) 247 FLR 261 at 284 [82]. Similarly, the trial judge said that a question for the jury in relation to the September 2006 importation was: "Has the prosecution proved that [the second appellant], with others, imported the drugs that arrived in September because he helped pack them and intended them to be brought into Australia?" In relation to the second appellant, the trial judge also said: "Are you satisfied that [the second appellant] packed drugs inside the monitors in Canada? Are you satisfied of that on the basis of Mr Reed's evidence? Are you satisfied that [the second appellant] sent money to Mr Nerbas in April and May 2006?" The trial judge further said: "If you are satisfied that there was a transfer of funds because there is evidence from, for example, Mr Reed about those arrangements, and if you are satisfied of the authenticity of [certain] documents, then you can reach a conclusion about the transfer of those funds. If you are satisfied that there was the transfer of funds …, then you still have to consider whether you are satisfied that that transfer was for the purpose of facilitating the importation of drugs by funding Customs clearances or warehouse expenses or other expenses in circumstances in which [the second appellant] knew and intended that drugs be imported. You have to consider: might that transfer of funds, if you are satisfied it occurred, have occurred for some innocent purpose with [the second appellant] not knowing that the money was to be used to import monitors containing drugs. So the first issue on the first count against [the second appellant] is whether he, along with others, engaged in conduct which brought the drugs into Australia. The second issue is intent. Did he intend to import the substances that were concealed inside the monitors? In other words, did he mean to import those substances? You also have to be satisfied that he knew the substances were border controlled drugs. If it was part of a joint enterprise that caused the monitors to be imported in May 2006, and if you are satisfied beyond reasonable doubt that he knew or believed that the monitors contained drugs, then you may infer that he intended to import the substances knowing that they were border controlled drugs." As to the September 2006 importation, the trial judge said: "You must be satisfied beyond reasonable doubt that [the second appellant] imported and intended to import the substances that were imported in September 2006 and he knew them to be border controlled drugs. You consider whether he had a role in packing the drugs into the monitors knowing they were to be sent to Australia. If it was part of a joint enterprise that caused the drugs to be imported in September 2006 and if you are satisfied beyond reasonable doubt that he knew or believed that the monitors contained the drugs, and he was part of that joint enterprise, then you can infer that he intended to import them." To some degree these directions are framed in terms of the joint criminal enterprise case. But the direction about the transfer of funds raised for the jury's consideration the issue of whether the transfer was for the purpose of facilitating the importation of drugs; and if the transfer took place it obviously did facilitate the importation. The jury was also asked to consider whether the second appellant "along with others" engaged in conduct which brought the drugs into Australia. To engage in that conduct with others is to bring about or make more likely the importation by Reed, and thus to aid, abet, counsel or procure it. The case against the first appellant. The case against the first appellant was that he had discussed with Reed the possibility of sending drugs concealed in computer monitors by shipping container to Australia. He arranged for Reed to prepare a list of costs in relation to freight and warehousing. He gave Reed money to place a deposit on an order for 480 computer monitors. He, Reed and another located a warehouse to use in their activities. He provided money to Reed to pay for the balance owing on the computer monitors. With Reed and another he began packing the computer monitors with drugs, assisted by the second appellant and the second appellant's father-in-law. The first appellant and Reed travelled to Australia in order to rent a warehouse where the consignment of drugs could be received. The first appellant paid for his and Reed's tickets to Australia. He also arranged for the taking of other steps in relation to the importing of drugs. He arranged through a union official to have the relevant container cleared quickly through customs in Brisbane. He, Reed and another used a borrowed forklift to transfer the pallets containing the drugs into a warehouse. He handled some of the drugs and supplied them to particular individuals. His activities in relation to the September 2006 shipment of drugs were similar. The directions about the first appellant. The directions in relation to the first appellant were similar to those in relation to the second appellant. Thus the trial judge said in relation to the May 2006 importation: "Has the prosecution proven that [the first appellant], with others, imported the drugs that arrived in May and intended to do so?" He also said: "In order to have imported the drugs in May … [the first appellant], along with others, must have brought the drugs into Australia when they came into the port in May 2006 and were cleared through the port. The question is did he intend to import the substances that were concealed inside the monitors? In other words, did he mean to import those substances? If he did, did he know they were border controlled drugs? If it was part of the joint exercise that caused the monitors to be imported in May 2006, are you satisfied beyond reasonable doubt that he knew or believed that the monitors contained the drugs? Do you infer that he intended to import the drugs on the basis of the things that were put to you by the [prosecution] or other things that you draw by way of inference from the evidence?" In relation to the September 2006 importation the trial judge said: "In order to have imported the drugs in September 2006 [the first appellant], along with others, must have engaged in conduct which brought the drugs into Australia in September 2006. You consider the direct evidence and the circumstantial evidence and decide if you are satisfied beyond reasonable doubt that he imported the drugs and intended to import the drugs that were concealed inside the monitors. In other words, did he mean to import those substances knowing that they were border controlled drugs?" To ask whether the first appellant "brought the drugs into Australia" in May or "engaged in conduct which brought the drugs into Australia" in September is to ask whether the primary factual allegations about the first appellant's conduct in relation to the entry of the drugs into Australia were to be accepted. Those primary factual allegations were that the first appellant brought about the importation or made it more likely. If they were accepted, the first appellant's conduct fell within s 11.2. Conclusion. Hence the Court of Appeal was correct to say: "The jury was … directed to the question of whether each appellant had performed tasks aimed at achieving the importation and, with others, imported the drugs. The positive finding which the jury must have made would equally have founded a conclusion that each appellant had aided others to commit the offence of importing. Although that characterisation of the conduct was not used, the necessary factual finding for it existed."58 The appellants did not directly confront and challenge that conclusion. The Court of Appeal was also correct to deny that the "absence of reference to aiding deflected the jury from the true issue between the Crown and the appellants; that is, whether the latter did things to advance the importation of drugs into Australia"59. A complaint is made that there was no direction that it was essential to the proof of the second appellant's guilt that the jury be satisfied that he helped to pack the drugs imported in September 2006. That complaint is not soundly based. The direction that the prosecution had to prove that the second appellant "helped pack" the drugs, quoted above60, answers the complaint. Helping to pack the drugs was evidence of aiding, abetting, counselling or procuring their importation – of bringing it about or making it more likely – for if they were not packed in Canada they would never have entered Australia. The directions, then, though framed with an eye to a joint criminal enterprise case, were in their references to the relevant primary facts sufficiently adapted to a s 11.2 case. The appellants were not able to point to any prejudice to their interests flowing from the erroneous references to a joint criminal enterprise case. That is not surprising, for that type of case is likely to be harder to establish than a s 11.2 case. Form is important in criminal law. Sometimes form prevails over substance. Sometimes form can be substance. But the appellants' complaints about the importation directions were entirely form-based and wholly removed from substantive considerations. The jury direction was erroneous. But the error of the trial judge lay in referring to a joint criminal enterprise case. It did not lie in a failure to give directions about the facts underlying a s 11.2 case. Errors too fundamental to permit application of proviso? The Court of Appeal applied the proviso: it held that the appellants were correct in complaining of a misdirection, but found that the appeals should be dismissed because no substantial miscarriage of justice had actually occurred. 58 R v Handlen (2010) 247 FLR 261 at 284 [79]. 59 R v Handlen (2010) 247 FLR 261 at 284 [82]. The appellants submitted that the proviso could not be applied where "there has been a failure to observe the conditions which are essential to a satisfactory trial"61. The equivalent submission by the appellants in the Court of Appeal was that the erroneous summing up prevented the proviso from being applied because it was "such a departure from the essential requirements of the law that it [went] to the root of the proceedings"62 and "such a serious breach of the presuppositions of the trial"63. The appellants' submission is not without force. It is obviously highly undesirable for juries to be directed in terms of crimes which do not exist or not to be directed with reference to the precise language of the crimes charged. But a failure to give full directions about the elements of an offence does not necessarily amount to a miscarriage of justice64 and does not necessarily mean that the trial is "fundamentally flawed or '… so far miscarried as hardly to be a trial at all'."65 Here the misdirection, although not framed in terms of s 11.2, did contain language directing the jury's attention to the factual issues thrown up by s 11.2. The case is not of the kind which prevents the proviso from being applied at all. Section 80 of the Constitution The appellants argued that the jury had not been directed to return a verdict on the elements listed in s 11.2 of the Code, and hence the proviso could not apply because there had been no trial by jury as required by s 80 of the Constitution. It relevantly provides: "The trial on indictment of any offence against any law of the Commonwealth shall be by jury". The appellants cited numerous Australian, English and American authorities. With respect, they do not support the submission. If the appellants' submission were correct, it would 61 Quoting Nudd v The Queen (2006) 80 ALJR 614 at 618 [6]; 225 ALR 161 at 163; [2006] HCA 9. 62 Wilde v The Queen (1988) 164 CLR 365 at 373 per Brennan, Dawson and Toohey JJ; [1988] HCA 6. 63 Weiss v The Queen (2005) 224 CLR 300 at 317 [46] per Gleeson CJ, Gummow, Kirby, Hayne, Callinan and Heydon JJ; [2005] HCA 81. 64 Holland v The Queen (1993) 67 ALJR 946 at 951; 117 ALR 193 at 200; [1993] HCA 43. 65 Krakouer v The Queen (1998) 194 CLR 202 at 212 [23] per Gaudron, Gummow, Kirby and Hayne JJ; [1998] HCA 43, quoting Wilde v The Queen (1988) 164 CLR 365 at 373 per Brennan, Dawson and Toohey JJ. See also Darkan v The Queen (2006) 227 CLR 373 at 402 [96] and 405 [107]; [2006] HCA 34. mean that any jury misdirection on the elements of an offence would make the trial not one complying with s 80 and would prevent the proviso from applying. That outcome is inconsistent with the cases referred to above in which jury misdirections have not prevented the proviso from being applied66. The appellants did not contend that those cases should be overruled. The appellants' submission is not correct. The trial was imperfect, but it was a trial by jury. Section 80 does not require that the actual conduct of jury trials be flawless. Section 80 is directed to structural questions about the rules for selecting the jury and governing its deliberations – at least primarily, and it is difficult to think of instances where s 80 would not be complied with merely because a trial before a jury subject to satisfactory rules of selection and deliberation which had been complied with had miscarried in some other way falling short of the fundamental deficiencies discussed above67. The interveners advanced very detailed arguments in refutation of the appellants' submission on s 80. In view of the dissenting nature of this judgment there is no point in dealing with them or with the appellants' submission further. The counts of possession and attempted possession The first appellant was convicted on one count of possession of drugs. Both appellants were convicted on a count of attempted possession of drugs. In each appellant's written submissions the following paragraph appeared: "Here there was no error of law in the way the counts of possession and attempted possession were was put to the jury and the evidence of Reed provided a basis upon which to return verdicts of guilty if the jury accepted Reed's evidence." The words "possession and" and "were" were crossed out. Both appellants thus submitted that there was no error of law in the way the attempted possession charge was put to the jury. It was also true, as the deleted words said, that there was no error of law in the way the possession charge was put to the jury either. However, despite his admission, the first appellant submitted as follows: "The Crown case on the counts of possession and attempted possession of border controlled drugs was intrinsically bound up with the narrative supporting the counts of importing border controlled drugs. The count of possession of border controlled drugs concerned drugs which Reed said 66 See above at [80]. were actually imported and the importation was the subject of a count on the indictment. The count of attempted possession related to the intercepted drugs which Reed said were being imported. Reed was, in law, the principal offender on the importation counts. He was also a very active party. … The Crown was faced then with forensic issues. Reed was the Crown's crucial witness. His evidence had to be accepted if convictions were to be achieved. However, not only had Reed actually taken most of the physical steps to effect the importations and made most of the arrangements, but in law, he was the principal offender, with the co-accused as parties to his offending. This awkward situation was avoided by the Crown by having the importation counts put on an improper basis. The Crown witness Reed was not put as the principal, but was put with the others as several participants in the 'joint criminal enterprise'. The appellant was therefore badly disadvantaged in his defence of all counts including those of possession and attempted possession of a border controlled drug. This constituted a miscarriage of justice." (emphasis in original) And the second appellant, despite his admission, put a similar submission limited to the charge of attempted possession. Although the second appellant played a lesser role than Reed, these submissions exaggerate Reed's role. Reed's role was major, but not greater than the first appellant's role. Another criticism which must be made of the submissions is that they suggest that the prosecution deliberately chose to put a joint criminal enterprise case knowing that it was wrong, instead of putting a s 11.2 case. There is no reason to suppose that the prosecution tactics flowed from anything other than an innocent mistake. Putting those criticisms aside, the difficulty with the submissions is that they do not explain why the "situation" was "awkward"; or, if it was, how the prosecution's mistake in putting its case, not complained of by the defence, removed the awkwardness; or how the appellants were badly disadvantaged in relation to the possession and attempted possession counts. Nor was it explained how the submissions would work if it were held, as stated above, that the directions were appropriate to a s 11.2 case. In oral argument the second appellant submitted that the deliberations of the jury on attempted possession were "necessarily infected" by the presentation of the case as one of joint criminal enterprise. It was submitted that once the jury concluded that Reed and the appellants were all principals in a joint criminal enterprise it was a short but wrong step to conclude that attempted possession was caught up in the joint criminal enterprise approach. This does not explain why the joint criminal enterprise approach made it likelier that the second appellant would be found guilty of attempted possession than an approach centring on whether he had aided, abetted, counselled or procured Reed's crime. The submission continued: "it is not surprising that the jury were not directed to consider the case in respect of the attempted possession in any separate fashion to that involving a joint criminal enterprise. They were not asked to quarantine the evidence of the importation. They were not asked to put that aside and approach the knowledge and intention involved for possession … separately; they would simply say to look at all the surrounding circumstances and those surrounding circumstances necessarily involved, by the way the case was litigated, a joint criminal enterprise both to import and to possess." At the trial the second appellant never asked for these specific directions. Indeed it would probably have been wrong to have given them. Further, counsel for the prosecution responded to the oral submission advanced for the second appellant thus: "The attempted possession counts are based on evidence of the appellants literally attempting to get the drugs out of the containers and the monitors, which has absolutely nothing to do whatsoever with any joint enterprise, it has nothing to do with anything being put about aiding or abetting or not being put about aiding or abetting and it is in no way tainted by that. [The second appellant] cannot point to anything that indicates that a finding in relation to the correct elements and verdict in relation to possession, or attempted possession, has in any way been infected by what occurred in the earlier counts. The facts remain the same throughout. The allegations remain the same throughout and that is that they each played certain roles and the like but, at the end of the day, they were, in effect, caught with the goods." That blunt submission is correct. Orders The appeals should be dismissed.
HIGH COURT OF AUSTRALIA MINISTER FOR IMMIGRATION & CITIZENSHIP APPELLANT AND SZGUR & ANOR RESPONDENTS Minister for Immigration & Citizenship v SZGUR [2011] HCA 1 2 February 2011 1. Appeal allowed. ORDER Set aside paragraphs 1 and 2(a) and (b) of the order of the Federal Court of Australia made on 4 March 2010, as varied by the order of that Court made on 26 March 2010, and in their place order that the appeal to that Court be dismissed. The appellant pay the costs of the first respondent in this Court. On appeal from the Federal Court of Australia Representation S B Lloyd SC with G R Kennett for the appellant (instructed by Clayton Utz Lawyers) G C Lindsay SC with L J Karp for the first respondent (instructed by Dobbie and Devine Immigration Lawyers Pty Ltd) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Immigration & Citizenship v SZGUR Immigration – Refugees – Review by Refugee Review Tribunal ("RRT") –Where visa applicant's migration agent asked RRT to arrange "independent assessment of [applicant's] mental health, if required" – Section 427(1)(d) Migration Act 1958 (Cth) gave RRT power to require Secretary to arrange for making of medical examination – Whether duty on RRT to consider exercising power under s 427(1)(d) – Whether general duty to inquire. Words and phrases – "information". Migration Act 1958 (Cth), ss 424, 424A, 427(1)(d), 430. FRENCH CJ and KIEFEL J. Introduction The function of the Refugee Review Tribunal ("the Tribunal") in reviewing decisions under the Migration Act 1958 (Cth) ("the Migration Act") has been described as inquisitorial. That designation does not mean that there is any general duty imposed on the Tribunal, as part of its review function, to use, or to consider using its investigative powers to obtain information relevant to the review. In this case, an applicant before the Tribunal, the first respondent SZGUR, supported by statutory declarations from acquaintances and certificates from a psychiatrist, told the Tribunal that he was suffering from depression, Bipolar Mood Disorder and forgetfulness. The information was provided by his migration agent in explaining the existence of contradictions and inconsistencies in SZGUR's submissions and testimony to the Tribunal, about which the Tribunal had invited his comment. The agent asked the Tribunal to arrange an "independent assessment of his mental health, if required". The Tribunal did not do so. The Federal Court, on appeal from the Federal Magistrates Court, held that the Tribunal had committed jurisdictional error by failing to consider whether to use its statutory powers to arrange such an assessment. This was not a matter which had been raised in the Federal Magistrates Court. The Federal Court was in error in inferring that the Tribunal had failed to consider the agent's request or the exercise of its statutory powers to arrange an independent assessment of SZGUR. The appeal should be allowed. Other matters raised on behalf of SZGUR in a notice of contention do not disclose a basis for otherwise supporting the result in the Federal Court. Procedural and factual background SZGUR, a citizen of Nepal, arrived in Australia lawfully on 18 December 20041. On 21 January 2005, he lodged an application for a protection visa. SZGUR claimed that because of his support for the Maoist Nepali Communist Party he had been at risk of execution in Nepal by the Royal Nepalese Army. He said he had to leave Nepal in order to save his life. If he were to return and the Army were to find him they would kill him. They had already visited his home and interrogated his wife and relatives about his whereabouts. 1 He arrived on a sub-class 679 visa. SZGUR's application for a protection visa was refused by a delegate of the Minister for Immigration and Citizenship ("the Minister") on 11 February 2005. On 15 March 2005, SZGUR applied to the Tribunal for a review of the delegate's decision. On 30 May 2005, the Tribunal affirmed the decision. That decision of the Tribunal was quashed by the Federal Magistrates Court and remitted to the Tribunal differently constituted. So too, was a further decision of the Tribunal which again affirmed the delegate's decision. Following the second remitter, SZGUR gave oral testimony, on 6 March and 2 April 2008, at hearings before the Tribunal, again constituted differently from its predecessors. On 11 April 2008, the Tribunal wrote to SZGUR inviting him to "comment on or respond to information that the Tribunal considers would, subject to any comments or response you make, be the reason, or a part of the reason, for affirming the decision that is under review". The language of the invitation was taken from s 424A of the Migration Act which requires the Tribunal to give to an applicant "clear particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review"2. In such a case the Tribunal is required to invite the applicant to comment on or respond to the information3. The "information" upon which the Tribunal invited comment, was the existence of "contradictions and inconsistencies" between what SZGUR had stated orally and in writing to the Tribunal, variously constituted, during the iterations of the review process. The contradictions and inconsistencies, which were elaborated at some length in the letter, related to SZGUR's claimed involvement with the Communist Party of Nepal, whether he and his family had gone into hiding in Nepal, whether he had been helped to leave the country and his claim that two colleagues had been executed by the Nepalese Army. the Despite language of the existence of "inconsistencies" and "contradictions" in an applicant's testimony and written submissions to the Tribunal is not "information" of the kind to which s 424A is directed. As was explained by the plurality in SZBYR v Minister for Immigration the Tribunal's letter, 2 Migration Act, s 424A(1)(a). 3 Migration Act, s 424A(1)(c). The Tribunal is also required to ensure, as so far as is reasonably practicable, that the applicant understands why the information is relevant and the consequences of it being relied on in affirming the decision under review: s 424A(1)(b). and Citizenship4, the term "information" in s 424A does not extend to the Tribunal's "subjective appraisals, thought processes or determinations"5. Their Honours said: "However broadly 'information' be defined its meaning in this context is related to the existence of evidentiary material or documentation, not the existence of doubts, inconsistencies or the absence of evidence." The exclusion of this class of information from the obligation imposed by s 424A is consistent with limits on the procedural fairness hearing rule at common law. Procedural fairness requires a decision-maker to identify for the person affected any critical issue not apparent from the nature of the decision or the terms of the statutory power. The decision-maker must also advise of any adverse conclusion which would not obviously be open on the known material. However, a decision-maker is not otherwise required to expose his or her thought processes or provisional views for comment before making the decision6. That is not to say that the Tribunal cannot or should not, in the exercise of its discretion, invite an applicant for review to make supplementary submissions in relation to apparent inconsistencies, contradictions or weaknesses in his or her case which have been identified by the Tribunal. Indeed it may be that such an invitation, once issued, amounts to a binding indication by the Tribunal that the review process will not be concluded until the applicant has had an opportunity to respond7. But an invitation to comment on perceived inconsistencies and contradictions is not an invitation under s 424A. The Tribunal's letter of 11 April 2008, despite its phrasing, was not sent pursuant to the obligation imposed by that section. Part of (2007) 81 ALJR 1190 at 1196 [18] per Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ; 235 ALR 609 at 616; [2007] HCA 26. 5 Citing with approval VAF v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 206 ALR 471 at 477 per Finn and Stone JJ. 6 Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591-592; and see SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at 161-162 [29]-[32] per Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ; [2006] HCA 63; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 at 219 [22] per Gleeson CJ, Gummow and Heydon JJ; [2003] HCA 56 and Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte MIAH (2001) 206 CLR 57 at 117-118 [194] per Kirby J; [2001] HCA 22. 7 Applicant NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 221 CLR 1 at 11-12 [30]-[34] per McHugh, Gummow, Callinan and Heydon JJ; [2004] HCA 62. the reasoning in the Federal Court depended upon the incorrect view that it was such an invitation. SZGUR, by successive migration agents, requested and was granted two extensions of time to respond to the Tribunal's letter. In a letter of 20 May 2008 requesting an extension of time, SZGUR's agent said he had been provided with evidence from a psychiatrist that SZGUR was suffering from depression and would be "unable to work until 29 May 2008". The letter enclosed a certificate from a psychiatrist as to SZGUR's depression and five statutory declarations by people testifying to his forgetfulness. On 20 June 2008, SZGUR's agent wrote to the Tribunal in response to its letter of 11 April 2008. He said that SZGUR was "going through depression & disorder of some kind" and attached another two statutory declarations, and a certificate from the psychiatrist which stated that SZGUR was being treated for Bipolar Mood Disorder, was receiving regular medication and was attending consultations with the psychiatrist. The agent said that SZGUR confirmed that he could not remember things that happened a long time ago and that SZGUR accepted that there were inconsistencies in the information he had provided to the Tribunal from time to time. SZGUR could not tell which information was correct and which was not. The agent had attempted to get clarification from SZGUR on various issues which had been raised by the Tribunal, but he had "mixed up the things all the time". The agent said that SZGUR was unable to provide "categorical comments" on the issues raised by the Tribunal. Because his forgetfulness was worsening the information provided in his original application for a protection visa and at the first Tribunal hearing would be more correct than information provided at later hearings. The agent's letter concluded with a request: "For the above reasons I would like to request you to assess his application based on his original application and evidences considering his mental health. To further assess his mental health situation, I would like to request you to arrange independent assessment of his mental health, if required. The applicant confirms that he would pay the cost of the assessment. Should you require any further information, please don't hesitate to advise." The Tribunal did not accede to the agent's request. On 3 September 2008, the Tribunal again affirmed the delegate's decision. SZGUR made an application for judicial review of the Tribunal's decision in the Federal Magistrates Court. That application was dismissed on 7 August 20098. On 4 March 2010, Rares J allowed SZGUR's appeal against the decision of the Federal Magistrates Court9. His Honour set aside the order made by that Court and in lieu thereof ordered the issue of certiorari to quash the decision of the Tribunal and mandamus directing the Tribunal to hear and determine the application for review according to law. On 30 July 2010, Gummow and Kiefel JJ granted an application by the Minister for special leave to appeal against the decision of Rares J. The Minister gave an undertaking that he would not seek to disturb the orders as to costs which had been made in the courts below, and that he would pay SZGUR's costs of the appeal including the costs of the application for special leave. The Tribunal's decision In its reasons for decision, the Tribunal referred to and summarised the contents of the letters of 20 May 2008 and 20 June 2008 from SZGUR's migration agent and the documents enclosed with them. However, it made no reference to the conditional request in the letter of 20 June 2008 that it arrange a medical assessment of SZGUR. The Tribunal did not find SZGUR to be a credible witness. His inconsistent and contradictory statements indicated that, contrary to his claims, "[he] was not a supporter of and closely associated with the Maoists; did not collect money for the Maoists or provide security information; the army was not looking for him; and he and his family did not go into hiding". The Tribunal took into account the medical certificate, the statutory declarations as to SZGUR's forgetfulness, the stress of separation from his family and the time which had elapsed since he left Nepal, but added: "However, the Tribunal was not provided with any further details about the applicant's condition by himself or [the consulting psychiatrist] nor did the medical certificates specifically address the issues raised in the Tribunal's letter of 11 April 2008 or the applicant's forgetfulness." The Tribunal drew a distinction, adverse to SZGUR, between forgetfulness about everyday events, dates and names and his claimed 8 SZGUR v Minister for Immigration [2009] FMCA 750. 9 SZGUR v Minister for Immigration and Citizenship (2010) 114 ALD 112. forgetfulness about specific details central to his need to leave Nepal. The Tribunal said it would expect him to remember when he started to collect donations, where he collected them, who provided assistance to him to leave Nepal, whether the assistance was pre-arranged and whether it was provided by a relative or some other person. Another basis for the adverse credibility finding was the "implausibility of [SZGUR's] central claim about the number of business people in one area that he would have spoken to in up to 13 years of collecting donations for the Maoists". The statutory framework This appeal focused upon s 427(1)(d) which confers powers on the Tribunal in terms which have remained unchanged since it was introduced as part of Pt 7 of the Migration Act in 199210. It provides: "For the purpose of the review of a decision, the Tribunal may: require the Secretary to arrange for the making of any investigation, or any medical examination, that the Tribunal thinks necessary with respect to the review, and to give to the Tribunal a report of that investigation or examination." At the heart of the decision of the Federal Court under appeal in this case was the proposition that the Tribunal had failed to consider whether it should require the Secretary of the Department of Immigration and Citizenship to arrange for a medical examination of SZGUR. This constituted, so it was said, a failure by the Tribunal to consider whether to exercise the power conferred on it by s 427(1)(d). The power conferred by s 427(1)(d) is to be exercised having regard to the requirement imposed on the Tribunal, in the discharge of its core function of reviewing Tribunal decisions11, "to pursue the objective of providing a mechanism of review that is fair, just, economical, informal and quick"12 and to act "according to substantial justice and the merits of the case"13. In so doing it is 10 The provision was introduced as s 166DD(d) by s 32 of the Migration Reform Act 1992 (Cth), but has since been renumbered. 11 Migration Act, s 415(1). 12 Migration Act, s 420(1). 13 Migration Act, s 420(2)(b). not to be bound by "technicalities, legal forms or rules of evidence"14. Section 424 provides that in conducting a review the Tribunal "may get any information that it considers relevant". It is required to have regard to any information so obtained in making the decision on the review15. Section 427(1)(d) is ancillary to s 424. Those two provisions and s 415, which confers upon the Tribunal all the powers and discretions of the person who made the decision under review, give the Tribunal wide discretionary powers to investigate an applicant's claims. But they do not impose upon the Tribunal a general duty to make such inquiries16. Relevantly to the present case, as Gummow and Hayne JJ observed in Minister for Immigration, Multicultural and Indigenous Affairs v SGLB17: "whilst s 427 of the Act confers power on the Tribunal to obtain a medical report, the Act does not impose any duty or obligation to do so." (footnote omitted) That observation was made in a context in which the Tribunal had considered it highly likely that the applicant for review was suffering from Post Traumatic Stress Disorder. The Court, by majority, held the Tribunal was under no duty to inquire as to the effect of that condition. The reasons for judgment of Rares J and the submissions made on behalf of SZGUR in this appeal assumed the existence, at least in some circumstances, of a duty on the part of the Tribunal to "consider" whether to exercise its power under s 427(1)(d). Rares J referred, in his reasons, to the judgment of the Full Court of the Federal Court in Minister for Immigration and Multicultural and Indigenous Affairs v Maltsin18. The Full Court there held that the Migration Review Tribunal was obliged, by s 361(3) of the Migration Act19, to consider an 14 Migration Act, s 420(2)(a). 15 Migration Act, s 424(1). 16 Re Minister for Immigration and Multicultural Affairs; Ex parte Cassim (2000) 74 ALJR 1404 at 1406 [13] per McHugh J; 175 ALR 209 at 212-213; [2000] HCA 50; Minister for Immigration and Multicultural Affairs v Anthonypillai (2001) 106 FCR 426 at 445 [86]. 17 (2004) 78 ALJR 992 at 999 [43]; 207 ALR 12 at 21; [2004] HCA 32. 18 (2005) 88 ALD 304. 19 Section 426(3) applies in similar terms to the Tribunal. applicant's request that it obtain oral evidence from named persons20. The reference in his Honour's judgment to Maltsin pointed to some analogical argument about a duty to consider a request to the tribunal to exercise its power under s 427(1)(d). The analogy, if that is what it was, was inapposite given the differences between ss 427 and 361. There is an express requirement in the latter section that the tribunal have regard to an applicant's notice requesting the tribunal to obtain oral evidence from named persons. The analogy is not supported by resort to the obligation in s 424 that the Tribunal have regard to information which it obtains under that section. This is not least because the fact of a request is not information of the kind contemplated by s 424. Nor is the analogy supported by s 424A. The question whether s 427(1)(d) imposes a legal duty on the Tribunal to consider whether to exercise its inquisitorial power under that provision was answered in the negative by the Full Court of the Federal Court in WAGJ v Minister for Immigration and Multicultural and Indigenous Affairs21. The Court held that absent any legal obligation imposed on the Tribunal to make an inquiry under s 427(1)(d) "[b]y a parity of reasoning … there is no legal obligation to consider whether one should exercise that power"22. That view is correct. That is not to say that circumstances may not arise in which the Tribunal has a duty to make particular inquiries. That duty does not, when it arises, necessarily require the application of s 427(1)(d). In Minister for Immigration & Citizenship v SZIAI23 the Court considered the implications of its designation, in earlier decisions24, of Tribunal proceedings as "inquisitorial". As was pointed out in that case, the term "inquisitorial" has been applied to tribunal proceedings to distinguish them from adversarial 20 Minister for Immigration and Multicultural and Indigenous Affairs v Maltsin (2005) 88 ALD 304 at 316 [38]. 21 [2002] FCAFC 277. 22 [2002] FCAFC 277 at [25]. 23 (2009) 83 ALJR 1123; 259 ALR 429; [2009] HCA 39. 24 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at 164 [40]; Minister for Immigration and Citizenship v SZKTI (2009) 238 CLR 489 at 499 [27] (fn 40); [2009] HCA 30. proceedings and to characterise the Tribunal's statutory functions25. As the "The duty imposed upon the Tribunal by the Migration Act is a duty to review. It may be that a failure to make an obvious inquiry about a critical fact, the existence of which is easily ascertained, could, in some circumstances, supply a sufficient link to the outcome to constitute a failure to review. If so, such a failure could give rise to jurisdictional error by constructive failure to exercise jurisdiction. It may be that failure to make such an inquiry results in a decision being affected in some other way that manifests itself as jurisdictional error." (footnote omitted) It was not necessary in that case to further explore those questions of principle. Nor in our opinion is it necessary in this case. Before turning to the contentions of the parties, reference should be made to the decisions of the Federal Magistrates Court and of the Federal Court which have led to this appeal. The decision of the Federal Magistrates Court SZGUR applied for judicial review of the Tribunal's decision in the Federal Magistrates Court on 3 October 2008. An amended application, supported by written submissions prepared by counsel, was filed on 19 March 2009. SZGUR appeared unrepresented at the hearing. On 24 April 2009, SZGUR filed an application to have the matter reopened for further argument. He was represented on 13 May 2009 by counsel, who applied to amend a ground of the application which alleged "serious errors of fact finding" on the part of the Tribunal. Counsel submitted, inter alia, that the Tribunal's decision was vitiated by unreasonableness because it had failed to make inquiries of SZGUR's treating psychiatrist as to the effect that his depression and Bipolar Mood Disorder may have had on his memory. The Federal Magistrates Court dismissed the application to reopen the case and to amend the grounds upon which review was sought. However, it did so on the basis of its rejection of the merits of the proposed amended ground. The point on 25 Minister for Immigration and Multicultural Affairs v SZIAI (2009) 83 ALJR 1123 at 1127 [18]; 259 ALR 429 at 434. 26 Minister for Immigration and Multicultural Affairs v SZIAI (2009) 83 ALJR 1123 at 1129 [25]; 259 ALR 429 at 436. which SZGUR succeeded in the Federal Court, and which is the subject of appeal to this Court, was not taken in the Federal Magistrates Court. The decision of the Federal Court In his amended notice of appeal to the Federal Court, SZGUR included the following ground: "The Court erred in finding that the Tribunal's failure to exercise its discretion pursuant to s 427(1)(d) of the Migration Act to obtain an expert opinion as to the appellant's memory (or to consider doing so) entailed a failure to complete the exercise of its jurisdiction pursuant to s 414 of the Migration Act." Rares J held that the Tribunal had constructively failed to exercise its jurisdiction and failed to have regard to a relevant consideration namely the migration agent's request that it arrange for a medical examination of SZGUR. On the premise that the Tribunal's letter to SZGUR on 11 April 2008 was written pursuant to s 424A(1) of the Act, his Honour held that the Act required the Tribunal to have regard to the agent's response to that letter. That premise, as noted earlier, was incorrect. His Honour held that there was nothing in the Tribunal's decision record or in the appeal papers to suggest that it understood that the agent had asked it to exercise its power under s 427(1)(d) to obtain a medical examination, or that it had given any, let alone proper, genuine and realistic consideration to the request. His Honour allowed the appeal and set aside the decision of the Federal Magistrates Court. He ordered that certiorari issue to quash the decision of the Tribunal. He also made an order in the nature of mandamus directing the Tribunal to hear and determine the application for review according to law. Grounds of appeal The grounds of appeal in this Court were: "2. His Honour erred in finding that the second respondent failed to consider the first respondent's request that it exercise its power under s 427(1)(d) of the Migration Act 1958 (Cth) (Act). His Honour erred in finding that, by reason of its failure to consider whether to exercise its power under s 427(1)(d) of the Act, the second respondent constructively failed to exercise its jurisdiction. His Honour erred in finding that, by reason of its failure to consider the first respondent's request that it exercise its power under s 427(1)(d) of the Act, the second respondent failed to have regard to a relevant consideration." The appeal - submissions and disposition The Federal Court's reasoning which led it to allow the appeal from the Federal Magistrates Court involved the following steps: The Tribunal had an obligation to give genuine and realistic consideration to the agent's request27. A failure to discharge that obligation would constitute jurisdictional error28. There was nothing in the Tribunal's decisional record or in the appeal papers to indicate it had given any consideration to the agent's request for an independent assessment of SZGUR29. It was safe to infer, from the preceding, that the Tribunal overlooked the agent's request or that it had no good reason for not considering it30. The Tribunal constructively failed to exercise its jurisdiction and failed to have regard to a relevant consideration, namely the request put as a response to its letter under s 424A. The premise upon which the Federal Court found jurisdictional error on the part of the Tribunal was that the Tribunal overlooked the agent's request, or did not consider it and had no good reason for not doing so. The premise depended for its correctness upon the content of the Tribunal's obligation under s 430 to give reasons for its decision. Rares J relied upon a passage from the judgment of McHugh, Gummow and Hayne JJ in Minister for Immigration and 27 SZGUR v Minister for Immigration and Citizenship (2010) 114 ALD 112 at 122 28 SZGUR v Minister for Immigration and Citizenship (2010) 114 ALD 112 at 120 29 SZGUR v Minister for Immigration and Citizenship (2010) 114 ALD 112 at 120 30 SZGUR v Minister for Immigration and Citizenship (2010) 114 ALD 112 at 121 Multicultural Affairs v Yusuf31 in which their Honours said that s 430 "entitles a court to infer that any matter not mentioned in the s 430 statement was not considered by the Tribunal to be material". That, of course, does not mean that a matter not mentioned in the s 430 statement was not considered. Section 430 presupposes a logical structure to the Tribunal's reasoning which involves the following steps: Identification of the relevant evidence or material upon which findings of fact can be based. 2. Making findings of fact based on the relevant evidence or material. Reasoning to the decision by application of the relevant legal principles to findings of fact, both primary and inferential. Section 430 therefore does not require that the Tribunal make reference, in its reasons, to the disposition of a request from an applicant for a medical examination or for any other investigation. The Tribunal's consideration of whether or not to exercise its power under s 427(1)(d) in aid of its discretion under s 424(1), whether requested or not, to "get any information that it considers relevant", is neither evidence nor material nor a fact upon which the Tribunal could base any findings or its ultimate decision. The nature of the Tribunal's treatment of the agent's letter of 20 June 2008 in its reasons was consistent with that view of what s 430 requires and the logical structure it presupposes. In any event, the Tribunal's reasons were sufficient unto the day for what they disclosed about its approach to the agent's letter. The Tribunal made express reference to the letter and its contents so far as they went to SZGUR's forgetfulness, depression and Bipolar Mood Disorder. It referred to the psychiatrist's report and the statutory declarations which were provided with the letter. The absence of a reference to the agent's request in this context provides no support for an inference that the request was overlooked. The Tribunal having read the letter must have read the agent's request. It is difficult to see by what mental process the Tribunal could be said not to have considered that request. The Tribunal's reasoning about the effect of SZGUR's mental state on his recollection of matters of central importance to his claim suggests that it might well have formed the view that an independent assessment of his mental health would have at most confirmed the claims made about it by the agent without resolving the important contradictions and inconsistencies which were, in the end, fatal to his application. It may be that the Tribunal would be open to 31 (2001) 206 CLR 323 at 346 [69]; [2001] HCA 30. criticism for that process of reasoning, but it is a process of reasoning about the evidence and material before the Tribunal which could not disclose jurisdictional error. It should also be noted that there is nothing to suggest that SZGUR could not have obtained from his psychiatrist a more expansive report than the bare certificates which were provided. That report could have addressed the very matters of which the agent asked the Tribunal to arrange an independent assessment. In submissions against the Minister's appeal, SZGUR argued that: If the Tribunal's letter was issued pursuant to s 424A, the Tribunal was required to have regard to the agent's request by reason of s 424A(1)(c). If the Tribunal's letter was not sent pursuant to s 424A, it was properly characterised as a letter issued pursuant to s 424 whereby the Tribunal sought "information" that it considered relevant. In that event, it was required by s 424 to have regard to the information provided in the agent's letter, including the agent's request. Neither of these submissions can be sustained. The first depends upon the incorrect proposition that the letter was sent under s 424A. The second would treat the agent's request as "information" for the purposes of s 424. The agent's request was a request that the Tribunal obtain information exercising its powers under s 427(1)(d). It was not itself information. In any event, for the reasons already given the factual premise that the Tribunal failed to consider the agent's request was not established. Subject to the issues raised in the notice of contention, the appeal must be allowed. The notice of contention – submissions and disposition SZGUR filed a notice of contention seeking to support the outcome in the Federal Court on the basis that Rares J should have found a jurisdictional error on the part of the Tribunal on grounds other than on which he decided the case. Eight grounds of contention were arranged under four topics: The Tribunal's statutory function with respect to evidence. (Grounds 1-2) Breach of procedural fairness. (Grounds 3-5) Due administration of the Migration Act. (Grounds 6-7) The nature of a s 414(1) review. (Ground 8) Under the first heading, SZGUR submitted that the Tribunal had based its decision on a finding that there was no connection between his medical condition and his memory or the quality of his evidence. He complained in ground 1 of the notice of contention that: the Tribunal had no evidentiary basis for that finding; the finding was based on the Tribunal's own lay opinion; and the Tribunal was not authorised by the Migration Act to act on its lay opinion. As was pointed out in the submissions for the Minister, Rares J acknowledged that the Tribunal focused upon the insufficiency of the medical evidence provided by SZGUR in response to the Tribunal's letter of 11 April 2008. On the basis of the insufficiency of the evidence, the Tribunal was entitled to come to the conclusion that the contradictions and inconsistencies it had identified were not explained by the brief, uninformative statements in the psychiatrist's certificates, nor by anecdotal lay accounts of forgetfulness set out in the statutory declarations. SZGUR also contended that, having accepted that he suffered from Bipolar Mood Disorder, depression and forgetfulness, the Tribunal failed to make inquiries as to the significance of his medical condition and how it bore upon his application, preferring to act upon its own judgment about what he might have been expected to remember concerning facts bearing on his application. This constituted, he submitted, a failure to review the delegate's decision as required by s 414 (grounds 2(a) and (b)). For the reasons already given, the Tribunal was under no obligation to make further inquiry in relation to the significance of SZGUR's medical condition. It acted upon its view of the limitations of the evidence provided to it. In so doing, it did not fail to discharge its duty under s 414. Then it was said that the Tribunal failed to have "regard … to … the information within its knowledge about [SZGUR's] medical condition". This was characterised as non-compliance by the Tribunal with s 424(1) of the Migration Act (ground 2(c)). There is no substance in the point. The Tribunal had regard to the evidence and found it wanting. The second avenue of attack in the notice of contention was based on procedural fairness (grounds 3-5). Grounds 3 and 4 relied upon the premise that the Tribunal failed to consider the agent's request that it arrange for an independent assessment of SZGUR. For the reasons already given, that premise was not made out. Then it was said that it was not open to the Tribunal to reach the state of satisfaction or non-satisfaction required by s 65 of the Act as to the fulfilment of the criteria for the grant of a protection visa without: having regard to and considering the agent's request; and taking steps to obtain an independent medical opinion. Again, SZGUR failed to demonstrate that the Tribunal did not have regard to and consider the agent's request. In any event the Tribunal was under no obligation to obtain an independent medical report. It was under no obligation derived from s 427(1)(d) to consider whether to obtain such a report. It was entitled to decide the case on the material before it and if the material were insufficient to satisfy it that SZGUR was entitled to the grant of a protection visa, it was required to affirm the delegate's decision. Grounds 6 and 7 of the notice of contention under the heading "Due Administration of the Migration Act as Federal Law" rested upon the premise that the Tribunal failed to consider the agent's request. For that reason alone they cannot succeed. Ground 8 assumed that the Tribunal did in fact consider the agent's request that it arrange for an independent assessment of SZGUR but then asserted: such consideration as may have been given to the request by the Tribunal lacked the character of a proper, genuine and realistic consideration of [SZGUR's] case as was necessary to constitute a "review" required by section 414(1) of the Migration Act to be undertaken; and by reason of its failure to comply with section 414(1), the Tribunal constructively failed to exercise its jurisdiction under the Act. It was submitted for SZGUR in support of this ground that if the Tribunal did consider the agent's request its consideration was deficient because "lacking probative information and evidence to support it, it was not of the quality necessary to meet the requirements of section 414(1) and section 65 of the Migration Act". The Minister made the point in response that the lack of reference to the agent's request in the Tribunal's reasons did not support an inference that the Tribunal had failed to consider the request. That argument having been accepted, there was no basis for any inference as to the degree of intensity with which the request was considered. None of the matters set out in the notice of contention was sufficient to support the outcome in the Federal Court. Conclusion For the preceding reasons the appeal should be allowed, and paragraphs 1 and 2(a) and (b) of the order of the Federal Court set aside. In lieu thereof there should be an order that the appeal to that Court be dismissed. The appellant, in accordance with his undertaking, should pay the first respondent's costs of the appeal. GUMMOW J. The first respondent is a citizen of Nepal who arrived in Australia on 18 December 2004 and thereafter applied for a protection visa under the Migration Act 1958 (Cth) ("the Migration Act"). His application was refused by a delegate of the appellant ("the Minister"). He then applied, pursuant to s 412 of the Migration Act, for review of the delegate's decision by the Refugee Review Tribunal ("the Tribunal"). The Tribunal, as constituted for the third time, affirmed the delegate's refusal. The Tribunal is the second respondent and has filed a submitting appearance. An application to the Federal Magistrates Court (Nicholls FM) for judicial review of the Tribunal's decision was unsuccessful32. An appeal by the first respondent to the Federal Court was heard by Rares J. His Honour held that there had been a constructive failure to exercise jurisdiction on the part of the Tribunal33. His Honour made an order in the nature of certiorari quashing the Tribunal's decision and an order in the nature of mandamus directing the Tribunal to determine the application for review of the delegate's decision according to law. The constructive failure to exercise jurisdiction was held by Rares J to be the Tribunal's failure to consider a request, made by the first respondent's migration agent on his behalf, that the Tribunal arrange an independent assessment of his mental health. The mental health of the first respondent was said to be relevant to his credibility because it made him forgetful or otherwise this explained certain errors and caused him memory problems, and inconsistencies in evidence provided by him in support of his claim for protection. For the reasons which follow, and contrary to the decision of the Federal Court, there was no such constructive failure to exercise jurisdiction by the Tribunal. The Minister's appeal to this Court should be allowed. The course of events in the Tribunal The Tribunal decision the subject of the application to Nicholls FM was the third decision of the Tribunal on review of the delegate's refusal to grant a protection visa to the first respondent. Each decision had been made by a differently constituted Tribunal. This circumstance was brought about by the setting aside of the first, and later the second, decision of the Tribunal, by order 32 SZGUR v Minister for Immigration and Citizenship [2009] FMCA 750. The Federal Magistrates Court had the same original jurisdiction as the High Court has under s 75(v) of the Constitution in relation to the Tribunal's decision: s 476(1) of the Migration Act together with the definitions of "migration decision" in s 5(1) and "privative clause decision" in s 474(2). 33 SZGUR v Minister for Immigration and Citizenship (2010) 114 ALD 112. of the Federal Magistrates Court34. The reasons for those orders do not affect this appeal. The first respondent attended four hearings conducted before the Tribunal. The first hearing, on 27 May 2005, and the second hearing, on 25 July 2006, were before the first and second Tribunals respectively. The third and fourth hearings, on 6 March 2008 and 2 April 2008, were both conducted by the third Tribunal. The Tribunal, as constituted for the third time, had regard to material that had been before the Tribunal as previously constituted, including evidence given at the first and second hearings. It appears to be the better view, as indicated by the Full Court of the Federal Court in SZEPZ v Minister for Immigration and Multicultural Affairs35, that the Tribunal was entitled to have regard to such material, and no party in this Court argued to the contrary. After the fourth and final hearing, the Tribunal wrote to the first respondent's former (but then current) migration agent by letter dated 11 April 2008. The letter, using the language of s 424A of the Migration Act, invited the first respondent to comment on or respond in writing to "information" that the Tribunal considered would be a reason for affirming the delegate's refusal to grant the protection visa. The letter set out "contradictions and inconsistencies" in what the first respondent had stated in his visa application, in a written submission to the first Tribunal, and at the four Tribunal hearings. The first respondent's written comment or response to the information was required by 28 April 2008. An extension of time was granted until 27 May 2008 upon a request by the first respondent's then migration agent for audio recordings of the first and second Tribunal hearings. On 20 May 2008, the first respondent's new migration agent requested a further extension of time, citing his own impending travel overseas and the first respondent's "depression". Attached to the letter was a certificate from Dr Masood Khan, a psychiatrist, dated 14 May 2008 which stated that the first respondent was suffering from depression and was unfit to work from 15 to 29 May 2008. Also attached were statutory declarations made by several acquaintances of the first respondent which variously referred to their perceptions of his "forgetting habit", "weak memory power", "poor memory especially in remembering names and dates", of him being a "bit forgetful" and "an absent- minded person", and that he "often forgets important dates and events". The 34 The first by consent order made on 26 April 2006; the second by order made on 28 November 2007: SZGUR v Minister for Immigration and Citizenship [2007] FMCA 1946. 35 (2006) 159 FCR 291 at 299 [39]. See also SZHKA v Minister for Immigration and Citizenship (2008) 172 FCR 1 at 9 [22], 13-14 [37]. letter also stated that the migration agent had asked the first respondent to obtain a "detailed psychological report". A further extension was granted to the first respondent until 3 July 2008. The response to the Tribunal's invitation, critical to this appeal, was made by the migration agent by letter dated 20 June 2008. The letter stated that the first respondent had difficulty remembering past events and "mixed up" things all the time. It accepted that the first respondent had provided contradictory information to the Tribunal on different occasions. The letter continued: "[The first respondent] claims that he has mentioned his habit of forgetting things during the Tribunal hearing as well. Looking at his ongoing mental problem [and] depression, he is unable to provide categorical comments on the issues you have raised. He has realized that his problem of forgetting things is getting worse day by day. … I previously asked him to present [a] detailed psychiatric report. I had given him a letter to hand to his psychiatrist. Now he claims that I never gave him such letter. For the above reasons I would like to request you to assess his application based on his original application and evidences [sic] considering his mental health. To further assess his mental health situation, I would like to request you to arrange independent assessment of his mental health, if required. [The first respondent] confirms that he would pay the cost of the assessment." Attached to the letter was a certificate of Dr Khan dated 16 June 2008 stating that the first respondent was "being treated for Bipolar Mood Disorder" and was "receiving regular medication" and attending consultations with Dr Khan. Two further statutory declarations were attached in which acquaintances stated their opinions that the first respondent was forgetful. The letter did not make reference to s 427(1)(d) of the Migration Act; however, that section provides relevantly as follows: "For the purpose of the review of a decision, the Tribunal may: require the Secretary to arrange for the making of any investigation, or any medical examination, that the Tribunal thinks necessary with respect to the review, and to give to the Tribunal a report of that investigation or examination." In issue on this appeal is whether the Tribunal in fact considered the migration agent's request and, if it did not do so, whether a failure to consider the request amounted to jurisdictional error. It has not been argued at any stage of the litigation that the first respondent lacked capacity or competency to make a visa application or take part in proceedings before the Tribunal36. The decision of the Tribunal The Tribunal handed down its decision on 16 September 2008. In reviewing the delegate's decision, the Tribunal was required by s 430(1) of the Migration Act to provide a written statement that set out the reasons for its decision and its findings on any material questions of fact, and that referred to the evidence or any other material on which those findings of fact were based. The first respondent's claim to be owed protection obligations was based on a fear of persecution by the Royal Nepalese Army by reason of his actual or imputed political opinion, namely his support of the Maoists. The Tribunal's reasons reveal that it did not believe the first respondent's assertions that he: (i) was involved with the Maoists in Nepal by collecting donations for them and providing them with security information; (ii) had gone into hiding with his family in Nepal because of fears for their safety; and (iii) required assistance to depart Nepal legally. The Tribunal found the first respondent not to be a credible witness, and found he was untruthful given the several inconsistencies in his evidence and incorrect statements made by him. The reasons of the Tribunal dealt in turn with each of the three matters raised by the first respondent. In addressing each matter, the Tribunal found that the first respondent had not been truthful about that matter. At par 124 of its reasons, the Tribunal summarised its decision by restating its findings that the first respondent was untruthful and the three matters raised by him lacked foundation. In par 125 the Tribunal said: "In reaching the above finding the Tribunal has taken into account the statutory declaration[s] provided by [the first respondent's] friends as to his forgetfulness. In reaching the above finding the Tribunal has also taken into [account] the medical certificates of Dr Masood Khan, 36 See Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 at 1000 [45]-[46]; 207 ALR 12 at 23; [2004] HCA 32. There does not appear to be an equivalent, in respect of the mentally infirm, to the Immigration (Guardianship of Children) Act 1946 (Cth), under which the Minister is the guardian of non-citizen children. consulting psychiatrist the first of which stated that he was suffering from depression and the other which stated that [the first respondent] is being treated for Bipolar Mood Disorder and is receiving regular medication and attends consultations with him. The Tribunal has also taken into account that [the first respondent], by being separated from his family, is in a stressful situation. Further, the Tribunal has taken into account the time that has lapsed since [the first respondent] left Nepal and he lodged the application. However, the Tribunal was not provided with any further details about [the first respondent's] condition by himself or Dr Khan nor did the medical certificates specifically address the issues raised in the Tribunal's letter of 11 April 2008 or [the first respondent's] forgetfulness." The reference in the first sentence of par 125 to "the above finding" is ambiguous. It may be a typographical error. It may refer to the several findings summarised in par 124. This would also be consistent with reading "the above finding" in par 124 as a singular finding by the Tribunal that the first respondent had not made out his claim to be owed protection obligations. That claim was dependent upon the three matters considered, and his truthfulness as to those matters, as the basis upon which his well-founded fear of persecution could be demonstrated. No reference was made in the Tribunal's reasons to s 427(1) of the Migration Act, or to the request made by the migration agent for the Tribunal to arrange an independent assessment of the first respondent's mental health. The reasoning of the Federal Magistrates Court and the Federal Court Argument before Nicholls FM had focused on whether his Honour should apply the reasoning of Wilcox J in Prasad v Minister for Immigration and Ethnic Affairs37, a case brought under the different regime of the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act"), and find that the Tribunal had fallen into jurisdictional error by unreasonably failing to make inquiries of Dr Khan as to the effect of the first respondent's mental health on his memory. The decision in Prasad was fully considered by this Court in Minister for Immigration and Citizenship v SZIAI38, a judgment delivered after Nicholls FM made his decision in the present case. On the appeal to the Federal Court the focus shifted. The successful ground of appeal was that Nicholls FM had erred in not finding that the 37 (1985) 6 FCR 155. 38 (2009) 83 ALJR 1123 at 1128-1129 [20]-[25]; 259 ALR 429 at 434-436; [2009] HCA 39. Tribunal's failure to consider to exercise its power under s 427(1)(d) of the Migration Act was a failure to undertake its statutory duty of review imposed by the words "must review the decision" in s 414 of the Migration Act. The submission advanced by the first respondent, and accepted by Rares J, was that the Tribunal failed to consider the migration agent's request that the Tribunal arrange a mental health examination of the first respondent, and that such a failure gave rise to a constructive failure to exercise jurisdiction. His Honour noted the absence of express reference in the Tribunal's written reasons to the migration agent's request39. He referred to s 430(1) of the Migration Act which provides as follows: "Where the Tribunal makes its decision on a review, the Tribunal must prepare a written statement that: sets out the decision of the Tribunal on the review; and sets out the reasons for the decision; and sets out the findings on any material questions of fact; and refers to the evidence or any other material on which the findings of fact were based." His Honour said that the obligation in s 430(1) "involves the tribunal recording what it did, not what it was asked to do, or supposed to do, or might have done"40. He then set out a passage from Minister for Immigration and Multicultural Affairs v Yusuf41. That case decided that s 430(1) obliged the Tribunal to set out its findings on only those questions of fact which it considered material to its decision. The passage set out by Rares J was from the reasons of McHugh, Gummow and Hayne JJ and included the statement that s 430 "entitles a court to infer that any matter not mentioned in the s 430 statement was not considered by the Tribunal to be material42". Rares J continued43: 39 (2010) 114 ALD 112 at 119 [26], 120 [31]. 40 (2010) 114 ALD 112 at 121 [33]. 41 (2001) 206 CLR 323 at 346 [69]; [2001] HCA 30. 42 Repatriation Commission v O'Brien (1985) 155 CLR 422 at 446 per Brennan J; [1985] HCA 10; Sullivan v Department of Transport (1978) 20 ALR 323 at 348-349 per Deane J, 353 per Fisher J; cf Fleming v The Queen (1998) 197 CLR 250 at 262-263 [28]-[29]; [1998] HCA 68. 43 (2010) 114 ALD 112 at 121 [34]. "Since the tribunal did not refer to the request or the test it applied to exclude the possible effect of depression and or bipolar mood disorder on [the first respondent's] memory, let alone indicate any consideration of these matters, it is safe to infer that it either overlooked them or had no good reason for not considering them". (emphasis added) At the conclusion of that passage his Honour referred to Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme44 and Applicant WAEE v Minister for Immigration and Multicultural and Indigenous Affairs45. In Palme, Gleeson CJ, Gummow and Heydon JJ said: "It was decided by this Court in R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Ltd46, where an order for prohibition under s 75(v) of the Constitution was made, that the 'inadequacy' of the material on which the decision-maker acted may support the inference that the decision-maker had applied the wrong test or was not 'in reality' satisfied of the requisite matters." In WAEE, the Full Court of the Federal Court observed: "The inference that the tribunal has failed to consider an issue may be drawn from its failure to expressly deal with that issue in its reasons. But that is an inference not too readily to be drawn where the reasons are otherwise comprehensive and the issue has at least been identified at some point. It may be that it is unnecessary to make a finding on a particular matter because it is subsumed in findings of greater generality or because there is a factual premise upon which a contention rests which has been rejected." There is some difficulty with the approach taken by Rares J as indicated in the passages quoted above. The Tribunal's treatment of the evidence adduced respecting the first respondent's mental health, and its relation (if any) to his memory and therefore the credibility and veracity of his claims, was a matter distinct from the treatment by the Tribunal of the migration agent's request for a medical examination of the first respondent. The drawing of an inference that the Tribunal had no good reason for not considering the request necessarily assumes the drawing of an anterior inference that the Tribunal did not consider the request. But that difficulty is merely a symptom of the more fundamental 44 (2003) 216 CLR 212 at 223-224 [39]; [2003] HCA 56. 45 (2003) 75 ALD 630 at 641 [47] per French, Sackville and Hely JJ. 46 (1953) 88 CLR 100 at 120; [1953] HCA 53. problem. The approach invites error by conflating consideration of the inferences available in respect of, on the one hand, the Tribunal's findings as to material facts, and, on the other, its treatment of a request to require the Secretary to the Department of Immigration and Citizenship to arrange a medical examination. The remainder of his Honour's reasoning that a failure by the Tribunal to consider the request amounted to jurisdictional error will be considered later in these reasons. It is convenient first to deal with the Minister's submission that the inference made by Rares J should not have been made. Did the Tribunal fail to consider the request? The Minister submits that clearly the Tribunal read the migration agent's letter of 20 June 2008. In its reasons the Tribunal referred to and summarised the majority of the contents of the letter, but it did not make reference to the request for a further medical examination of the first respondent. The Minister submits that Rares J erred in drawing an inference that the failure by the Tribunal to refer to the request in its written statement meant that the Tribunal had not considered the request. That submission should be accepted. An applicant in the Federal Magistrates Court for judicial review of the Tribunal's decision, as the moving party, bears the onus of establishing jurisdictional error on the part of the Tribunal. Nothing in the Migration Act displaces the usual position that it is for the moving party to make out its case. In Industrial Equity Ltd v Deputy Commissioner of Taxation47, Gaudron J made a similar point with respect to the ADJR Act. We are not concerned here with questions of a presumption of the regularity or validity of administrative action48. Rather, the point to be made is that it fell to the first respondent to establish a basis for drawing the inference necessary to make out the alleged jurisdictional error. There was certainly no burden upon the Minister to demonstrate the positive proposition that the Tribunal had indeed considered the request. In the penultimate paragraph of his reasons, Rares J referred to an argument put by the Minister that an inference should be drawn that the Tribunal had considered, and rejected, the request. His Honour said in response49: 47 (1990) 170 CLR 649 at 671-672; [1990] HCA 46. 48 As to which, see the authorities collected in Aronson, Dyer and Groves, Judicial Review of Administrative Action, 4th ed (2009) at 255 [4.345]. 49 (2010) 114 ALD 112 at 122 [37]. "But, there is no material, including any reference to the request, on which I can be satisfied that it was considered. There was no indication in the tribunal's written statement or the material in the appeal book that the tribunal either identified the making of the request to it or, if it did, that it considered and then rejected it (as it would have been entitled to do)". If this passage is to be understood as requiring the Minister to demonstrate, by way of evidence or inference, that the Tribunal did consider the request, that would indicate an incorrect approach to a proceeding for judicial review of the Tribunal's decision. The question whether the inference should have been drawn in the present case can only be addressed in the setting provided by the Migration Act, and in particular by reference to the requirement in par (b) of s 430(1) that the Tribunal provide a written statement which sets out the reasons for the decision. Contrary to the reasoning in the Federal Court, par (b) of s 430(1) does not create any requirement that the Tribunal record generally "what it did" in conducting its review, and does not require the Tribunal, in every case, to describe or state the procedural steps taken by it in reviewing the relevant decision. The obligation under s 430(1) focuses upon the thought processes of the Tribunal in reaching its decision on what it considers to be the material questions of fact50. The absence of reference in the Tribunal's reasons to its consideration of the request for a medical examination of the first respondent is to be contrasted with an absence of reference to findings of fact or to evidence and material upon which such findings are based. Section 430(1) deals with the latter in pars (c) and (d); it does not deal with the former. The statute does not require the Tribunal to disclose procedural decisions taken in the course of making its "decision on a review". There may be situations where a procedural decision forms part of the Tribunal's "reasons for the decision" under par (b), but that is not so here. An inference that the Tribunal did or omitted to do some act in the course of its review, not being a matter which s 430(1) requires the Tribunal to set out, should not be drawn lightly. Nothing found in the authorities relied upon by Rares J assists in the present case. The statement by McHugh, Gummow and Hayne JJ in Yusuf51, given the surrounding context and the authorities collected in the footnote at its conclusion, demonstrates that the reference there was to "matters of fact" or "findings of fact" and not to matters generally, such as the procedures the Tribunal chose to adopt in fulfilling its duty to review the delegate's decision. 50 Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at 331-332 [10], 338 [34], 346 [68]; Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611 at 623 [33]; [2010] HCA 16. 51 (2001) 206 CLR 323 at 346 [69]. In WAEE, the Full Court of the Federal Court was considering the Tribunal's failure to make reference to evidence that the appellant's son was married to a Muslim woman and the contention that this supported his claimed fear of persecution in Iran; a matter going directly to the criterion for the grant of Finally, the passage in Palme53 to which Rares J referred, noted that, given the detail in the relevant departmental submission and the statement by the decision-maker that he had considered all relevant matters, no assistance could be gained from the statement by Gibbs CJ in Public Service Board of NSW v Osmond54 (made with reference to Padfield v Minister of Agriculture, Fisheries and Food55) that "if the decision-maker does not give any reason for his decision, the court may be able to infer that he had no good reason". The inference could not be drawn in Palme because the decision-maker had given reasons for his decision, albeit reasons which did not meet the statutory description due to the failure to express the essential ground or grounds for the conclusion reached56. In the present case, no assistance can be drawn from the statement by Gibbs CJ in Osmond, or the reference to it in Palme; the Tribunal fulfilled its duty to give written reasons under par (b) of s 430(1). The Tribunal had clearly read the letter from the migration agent. The Tribunal summarised most of its contents in its written statement. That weighs against the drawing of an inference that the Tribunal did not read or did not turn its mind to the paragraph in which the request was made. The absence of reference in the Tribunal's written statement to the making of the request by the migration agent or to the Tribunal's decision as to the request was the only evidential basis upon which the inference could be made. In light of the other evidence, that was not a sufficient basis to found an inference that the Tribunal failed to consider whether to exercise its power under s 427(1)(d) to require the Secretary to arrange for a medical examination. 52 Applicant WAEE v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 75 ALD 630 at 641 [48]-[49]. 53 (2003) 216 CLR 212 at 224 [39]. 54 (1986) 159 CLR 656 at 663-664; [1986] HCA 7. 55 [1968] AC 997 at 1053-1054. See also Wu v The Queen (1999) 199 CLR 99 at 124 [71]; [1999] HCA 52. 56 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 at 224 [40]. Jurisdictional error? While, in light of the above conclusion, it is not necessary to decide conclusively whether a failure by the Tribunal to consider the request would have amounted to jurisdictional error, something should be said on that subject. Rares J had referred57 to the following passage from the plurality judgment in "Although decisions in the Federal Court concerned with a failure to make obvious inquiries have led to references to a 'duty to inquire', that term is apt to direct consideration away from the question whether the decision which is under review is vitiated by jurisdictional error. The duty imposed upon the Tribunal by the Migration Act is a duty to review. It may be that a failure to make an obvious inquiry about a critical fact, the existence of which is easily ascertained, could, in some circumstances, supply a sufficient link to the outcome to constitute a failure to review. If so, such a failure could give rise to jurisdictional error by constructive failure to exercise jurisdiction59. It may be that failure to make such an inquiry results in a decision being affected in some other way that manifests itself as jurisdictional error. It is not necessary to explore these questions of principle in this case." His Honour appears to have accepted that the Tribunal was not required to exercise its power under s 427(1)(d). The absence of a requirement is made clear by the use of the word "may" in the opening words of the sub-section; a point which was made in Minister for Immigration and Multicultural and Indigenous Affairs v SGLB60. Rather, his Honour framed the issue as whether the Tribunal ought to have considered the request for a medical examination61. His Honour, in reliance upon the reasoning of the Full Court in Minister for Immigration and Multicultural and Indigenous Affairs v Maltsin62 and the circumstance that the 57 (2010) 114 ALD 112 at 116 [15], 120 [28]. 58 (2009) 83 ALJR 1123 at 1129 [25]; 259 ALR 429 at 436. 59 See authorities collected in Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 453 [189], fn 214; [2001] HCA 51. 60 (2004) 78 ALJR 992 at 999 [43], 1019-1020 [124]; 207 ALR 12 at 21-22, 49. See also Minister for Immigration and Multicultural Affairs v Anthonypillai (2001) 106 FCR 426 at 445 [86]. 61 (2010) 114 ALD 112 at 113 [2]. 62 (2005) 88 ALD 304 at 316-317 [38]. request was made by the migration agent in his response to an invitation under s 424A, concluded that the Tribunal thereby "constructively failed to exercise its jurisdiction and failed to have regard to a relevant consideration, namely the request"63. Three points must be made with respect to that conclusion. First, the decision in Maltsin concerned the obligation of the Migration Review Tribunal ("the MRT") under s 361(3) of the Migration Act, the analogue of s 426(3) with respect to the Refugee Review Tribunal. Sub-section (3) of s 361 provides that the MRT "must have regard" to any notice given by an applicant, under sub-s (2) or (2A), that the applicant wishes the MRT to obtain oral or written evidence. The reasoning in Maltsin respecting consideration of an applicant's wishes is not relevant to the power conferred in discretionary terms by s 427(1). Indeed, the Full Court in WAGJ v Minister for Immigration and Multicultural and Indigenous Affairs64, when specifically addressing s 427(1)(d), concluded that there was no obligation on the Tribunal to consider whether to exercise the power there conferred. Secondly, it appears from the content of the Tribunal's letter of 11 April 2008 that it considered it was providing an invitation to the applicant under s 424A of the Migration Act to comment or respond to information that the Tribunal considered would be a reason for affirming the delegate's decision. No party suggested to the contrary before either Nicholls FM or Rares J. However, the assumption that the invitation was made pursuant to s 424A does not appear to be correct, given that the Tribunal's disbelief of the first respondent's evidence arising from inconsistencies therein could not be characterised as "information" within the meaning of s 424A65. The statutory basis for the Tribunal's invitation would appear, on a proper construction of the legislation, to be s 424 of the Migration Act. This empowered the Tribunal in conducting the review to get any information it considered relevant. The Minister advanced several arguments that whether an invitation was made under either s 424A or s 424 did not affect what the Tribunal was required to do with a request that it exercise the power under s 427(1)(d) to require the Secretary to arrange a medical examination. It is not necessary to address these arguments as the issues do not arise in this appeal. 63 (2010) 114 ALD 112 at 122 [37]. 64 [2002] FCAFC 277 at [24]-[25]. 65 SZBYR v Minister for Immigration and Citizenship (2007) 81 ALJR 1190 at 1195-1196 [15]-[21]; 235 ALR 609 at 615-617; [2007] HCA 26. Thirdly, it was accepted by Rares J that the Tribunal was entitled to reject the request made of it66. Thus there did not arise the point left open in SZIAI, that a failure to make an obvious inquiry as to a critical fact may give rise to jurisdictional error. The alleged failure on the part of the Tribunal was a failure to consider whether to (require the Secretary to) make an inquiry by arranging a medical examination. The first respondent's notice of contention While the Minister has made good his first ground of appeal, there remains the notice of contention filed by the first respondent. Grounds 3, 4, 5(a), 6 and 7 of the notice are premised on a failure by the Tribunal to consider the migration agent's request and so must fail. Grounds 1, 2(a) and 2(b) take issue with the way in which the Tribunal proceeded to make its decision in the absence of expert evidence as to the effect of the first respondent's mental condition on his memory. Of relevance in this regard is what the Tribunal said in the balance of par 125 of its written statement67: "Further, there is a difference between forgetting everyday events, dates and names and forgetting specific details that are central to [the first respondent] having to leave Nepal even if the Tribunal takes into consideration, in combination, the length of time since [the first respondent] left Nepal, [the first respondent's] claimed forgetfulness and depression/Bipolar Mood Disorder. In particular the Tribunal would expect [the first respondent] to remember when he started to collect donations or, at least, with better specificity than a difference of 7 years … and where he collected those donations whether it was in a rural area or where he had operated his business for sometime [sic]. The Tribunal would also expect [the first respondent] to remember who provided assistance to him at the airport so he could leave Nepal and whether he had arranged this assistance the day before or it happened by chance on the day. Further, the Tribunal would expect [the first respondent] to remember if the assistance was provided by a relative or not, irrespective of how long it was since he left Nepal." The first respondent submits that the Tribunal made a finding that there was no connection between his medical conditions and his memory, without any evidentiary foundation, and based upon its own lay opinion and the imposition of 66 (2010) 114 ALD 112 at 120 [30]. 67 The first part of par 125 is set out above at [57]. a standard as to what he could be expected to remember despite his medical conditions. The Tribunal took into account the evidence of Dr Khan that the first respondent was suffering (and presumably continued to suffer) from both depression and bipolar mood disorder. That evidence did not explain when the first respondent began suffering from either of those conditions, except insofar as Dr Khan certified him as unfit to work from 15 to 29 May 2008 by reason of depression. There was a lack of evidence linking the mental health of the first respondent with his claimed memory problems so as to explain, or be capable of explaining, the inaccuracies and inconsistencies in statements made by him to the Tribunal. No evidence was provided as to the likely effect, upon patients generally, of depression or bipolar mood disorder on memory, or as to their capacity to become confused in recalling events. No evidence was provided of the actual or likely effect of those two conditions, disparately or in conjunction, upon the first respondent. In Minister for Immigration and Multicultural and Indigenous Affairs v QAAH of 200468, Gummow ACJ, Callinan, Heydon and Crennan JJ observed: "This Court has repeatedly said that the proceedings of the Tribunal are administrative in nature, or inquisitorial69, and that there is an onus upon neither an applicant nor the Minister70. It may be that the Minister will sometimes, perhaps often, have a greater capacity to ascertain and speak to conditions existing in another country, but that does not mean that the Minister is to bear a legal onus, just as, in those cases in which an applicant is the better informed, that applicant is not to be so burdened." 68 (2006) 231 CLR 1 at 17 [40]; [2006] HCA 53. 69 See, eg, Muin v Refugee Review Tribunal (2002) 76 ALJR 966 at 985 [98] per McHugh J (citing, among others, Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 115 [76] per Gaudron and Gummow JJ; [2000] HCA 57), 1001 [208] per Kirby J, 1008 [246] per Hayne J, 1014 [287] per Callinan J; 190 ALR 601 at 625, 648, 658, 666; [2002] HCA 30. 70 See, eg, Minister for Immigration and Ethnic Affairs v Guo (1997) 191 CLR 559 at 573-574 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh and Gummow JJ; [1997] HCA 22; Abebe v The Commonwealth (1999) 197 CLR 510 at 544-545 [83] per Gleeson CJ and McHugh J; [1999] HCA 14; Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 673 [195] per Callinan J; [1999] HCA 21. Accordingly, neither the Tribunal itself nor the primary decision-maker acts as a contradictor to a visa applicant's case71. But an applicant for a protection visa must put forward the evidence the applicant wishes the Tribunal to consider72. Evidence as to a relevant connection between his mental condition and memory difficulty could be expected to have come from the first respondent or his migration agent73. Indeed, the migration agent without success had already requested that his client obtain a more thorough medical report. The Tribunal was entitled to proceed on the basis that it understood the first respondent had the relevant medical conditions, but in the absence of evidence was unable to find that those conditions impaired his memory. The Tribunal did not make a finding that the medical conditions did not impair the first respondent's memory. The Tribunal had no evidence on which it could explain away or put aside the errors and inconsistencies it had found in his evidence. What it went on to say about its "lay" expectations was not necessary to support that reasoning. Grounds 2(c) and (d) of the notice of contention essentially complain that the Tribunal, once it was aware of the first respondent's medical conditions, was required by s 424(1) of the Migration Act to have regard to his medical conditions, and the Tribunal was obliged to inquire as to what the medical conditions meant and how they bore upon his visa application. If it were accepted that the Tribunal was seeking, and received, information as to the first respondent's mental health under s 424(1), then it was required to have regard to that information in making the decision on review. It did so. Section 424(1) is not the source of any obligation on the Tribunal to go further and seek more information that might enhance, detract from or otherwise be relevant to information which it has already received. Ground 5(b) of the notice of contention is to the effect that the Tribunal, in order to reach a state of satisfaction about whether the criteria for a protection visa had been met (s 65(1)(a)(ii)), was required to obtain an independent medical report. But for the reasons given above74, there was no duty on the Tribunal to 71 Minister for Immigration and Citizenship v SZIAI (2009) 83 ALJR 1123 at 1127 [18]; 259 ALR 429 at 434. 72 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at 164 [40]; [2006] HCA 63. 73 See Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 673 [195] per Callinan J; Minister for Immigration and Citizenship v SZIAI (2009) 83 ALJR 1123 at 1133 [52] per Heydon J; 259 ALR 429 at 441-442. obtain a medical report. Even if the Tribunal had required the Secretary to arrange a medical examination under s 427(1)(d), attendance at the examination would not have been compulsory. A further power of the Minister concerning medical examinations is contained in s 60 of the Migration Act. By virtue of s 415(1), this is a power also enjoyed by the Tribunal. Section 60 provides as follows: If the health or physical or mental condition of an applicant for a visa is relevant to the grant of a visa, the Minister may require the applicant to visit, and be examined by, a specified person, being a person qualified to determine the applicant's health, physical condition or mental condition, at a specified reasonable time and specified reasonable place. (2) An applicant must make every reasonable effort to be available for, and attend, an examination." As is apparent from s 60(2), the visa applicant is not required to attend the examination. This may be because in most cases it will be, or at least in the present case it was, in the interests of the applicant to attend such an examination given the adverse consequences for his or her application which might follow on from a failure to so attend. The terms of s 427(1)(d) qualify the Tribunal's power with respect to medical examination by the words "that the Tribunal thinks necessary with respect to the review". There were no circumstances here that made such an examination necessary. The first respondent's migration agent had asked his client to obtain a detailed psychiatric or psychological report. The reason why such a report was not obtained was unknown. In his letter to the Tribunal, the migration agent said he gave the first respondent a letter for Dr Khan (presumably requesting a written report) but the first respondent then claimed never to have been given such a letter. The migration agent had indicated that the first respondent would meet the costs of an examination if arranged by the Tribunal. No reason has been shown as to why it would have been more appropriate, or necessary, for the Tribunal rather than the first respondent or his migration agent to arrange for such an examination. I agree with Rares J75 that it was open to the Tribunal to reject the request. The premise of ground 8 of the notice of contention is that if the Tribunal did consider the request, then no "proper, genuine and realistic consideration" was given to the request such that the Tribunal failed to review the delegate's decision as it was required to do by s 414(1). It is not possible to infer that the 75 (2010) 114 ALD 112 at 120 [30]. Tribunal gave a particular degree of consideration to the request. The success of this ground therefore depends upon establishing that if the Tribunal had given proper, genuine and realistic consideration to the request, it would have sought a medical report under s 427(1)(d). That is no more than another way of saying the Tribunal was bound to seek the medical report, which it was not. Order The grant of special leave to appeal was made upon an undertaking by the Minister not to seek to disturb the orders as to costs made in the courts below, and to pay the costs of the first respondent of this appeal, including the special leave application, regardless of the result of the appeal. It should therefore be ordered that: Appeal allowed. Paragraphs 1 and 2(a) and (b) of the order of the Federal Court made on 4 March 2010, as varied by the order of that Court made on 26 March 2010, be set aside and in place thereof order that the appeal to that Court be dismissed. The Minister pay the costs of the first respondent in this Court. HEYDON J. I agree with the reasons given by French CJ and Kiefel J, and Crennan CRENNAN J. For the reasons given by French CJ and Kiefel J, and also by Gummow J, I agree that the appeal should be allowed and that consequential orders should be made. I have nothing to add.
HIGH COURT OF AUSTRALIA Matter No S10/2011 PLAINTIFF S10/2011 AND PLAINTIFF MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR DEFENDANTS Matter No S43/2011 AND PLAINTIFF MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR DEFENDANTS Matter No S49/2011 PLAINTIFF S49/2011 AND PLAINTIFF MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR DEFENDANTS Matter No S51/2011 PLAINTIFF S51/2011 AND PLAINTIFF MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR DEFENDANTS Plaintiff S10/2011 v Minister for Immigration and Citizenship Kaur v Minister for Immigration and Citizenship Plaintiff S49/2011 v Minister for Immigration and Citizenship Plaintiff S51/2011 v Minister for Immigration and Citizenship [2012] HCA 31 7 September 2012 S10/2011, S43/2011, S49/2011 & S51/2011 In each matter, application dismissed with costs. ORDER Representation S B Lloyd SC with S E J Prince, G J D del Villar and J B King for the plaintiffs (instructed by Parish Patience Immigration Lawyers) S J Gageler SC, Solicitor-General of the Commonwealth with G R Kennett SC and A M Mitchelmore for the defendants (instructed by Australian Government Solicitor) M G Hinton QC, Solicitor-General for the State of South Australia with C Jacobi intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Plaintiff S10/2011 v Minister for Immigration and Citizenship Kaur v Minister for Immigration and Citizenship Plaintiff S49/2011 v Minister for Immigration and Citizenship Plaintiff S51/2011 v Minister for Immigration and Citizenship Administrative law – Procedural fairness – Migration – Refugees – Review by Refugee Review Tribunal and Migration Review Tribunal – Ministerial discretion – Migration Act 1958 (Cth) confers powers upon Minister to dispense with statutory requirements for visa if "in the public interest to do so" – Dispensing powers must be exercised personally and are non-compellable – Plaintiffs refused visas and unsuccessfully sought merits review of those refusals – Plaintiffs requested Minister to consider exercising and to exercise dispensing powers – Requests by three plaintiffs refused by departmental officers pursuant to guidelines issued by Minister not forwarded to Minister – Request by one plaintiff refused by Minister – Whether statutory provisions conferring dispensing powers apt to affect adversely the sufficient interest of a party seeking exercise of those powers – Whether statutory provisions conferring dispensing powers excluded any obligation of Minister to accord plaintiffs procedural fairness. Words and phrases – "dispensing provision", "guidelines", "legitimate expectation", "procedural fairness", "public interest", "sufficient interest". Migration Act 1958 (Cth), ss 48B, 195A, 351, 417. FRENCH CJ AND KIEFEL J. Introduction Four plaintiffs, each of them non-citizens who tried and failed to obtain visas to remain in Australia, apply to this Court for declaratory relief and the issue of certiorari and constitutional writs against the Minister for Immigration and Citizenship ("the Minister") and the Secretary for the Department of Immigration and Citizenship ("the Secretary"). The applications, referred for hearing to a Full Court by Gummow J, arise out of the failure of each of the plaintiffs to attract the exercise by the Minister of his or her non-compellable, non-delegable personal discretion to make decisions in favour of unsuccessful visa applicants and persons in detention under the Migration Act 1958 (Cth) ("the Act"). That discretion operates outside the regular statutory process for determination of visa applications and administrative review of such determinations by the Migration Review Tribunal ("the MRT") and the Refugee Review Tribunal ("the RRT"). It is conferred by a number of sections of the Act. Four of those sections are relevant to these proceedings. Under s 48B of the Act, the Minister may grant a protection visa to a person whose application for a protection visa has already been refused. Under s 195A, the Minister may grant a visa to a person in immigration detention. Sections 351 and 417 authorise the Minister to substitute for a decision of the MRT or the RRT a decision which is more favourable to the applicant. Each of the sections provides that the Minister is under no duty even to consider the exercise of the discretions they confer1. The Minister has issued or adopted previously issued ministerial guidelines in the form of directions to the Secretary and his or her officers setting out the circumstances in which the Minister may wish to consider exercising the discretionary powers under the four sections. The plaintiffs assert, as part of their respective grounds for relief, that the issue of the guidelines in relation to each section involved "a decision by [the Minister] to decide to consider the exercise of those statutory powers." As a premise for the claims for relief, that proposition should be rejected for the reasons set out below. The plaintiffs further assert that, having decided to consider the exercise of his or her powers, the steps taken under the guidelines to inform that consideration were steps towards the exercise of those powers. That proposition too should be rejected. The plaintiffs say that their rights and interests were directly affected by that consideration and that the valid exercise of the powers conferred by ss 48B, 195A, 351 and 417, to consider whether to exercise the powers conferred by those sections, is conditioned upon compliance with the requirements of procedural fairness. That proposition too should be rejected. 1 Act, ss 48B(6), 195A(4), 351(7), 417 (7). Each of the applications is said to raise a matter arising under the Constitution or involving its interpretation, namely, whether the executive power of the Commonwealth is constrained by a requirement that procedural fairness be afforded to a person whose rights, interests or legitimate expectations may be destroyed, defeated or prejudiced by its exercise. That question arises if the plaintiffs were to establish that the inquiries made, and the submissions prepared, by officers of the Department of Immigration and Citizenship ("the Department") pursuant to the ministerial guidelines were themselves capable of affecting, defeating or prejudicing rights, interests or legitimate expectations. They were not. For the reasons that follow, the consideration by officers of the Department of the requests by the plaintiffs for the Minister to consider exercising non-compellable powers under the Act did not attract the requirements of procedural fairness. Further, the Minister is not obliged to accord procedural fairness, in the form of the so-called hearing rule, in personally considering whether to exercise the Minister's discretion under ss 48B, 195A, 351 or 417. Each of the applications should be dismissed. The plaintiffs' histories The plaintiffs' histories have some common elements. Each of them applied for a visa and was refused on the merits, was unsuccessful in administrative review by the MRT or the RRT, and was unsuccessful in judicial review applications. Each submitted at least one request that the Minister exercise his or her discretion under one or more of ss 48B, 195A, 351 and 417. Each had his or her case considered personally by the Minister on at least one occasion under s 351 (Ms Kaur) or s 417 (Plaintiffs S10, S49 and S51). A brief outline of their individual histories follows. Plaintiff S10 Plaintiff S10, a citizen of Pakistan, arrived in Australia on 24 August 2007 and on 6 September 2007 applied for a protection visa. He claimed to fear persecution on account of his actual or imputed political opinions and religious beliefs if he were to be returned to Pakistan. On 6 November 2007, a delegate of the Minister refused the visa application. Following an application for merits review, the RRT affirmed that decision on 22 February 2008. An application for judicial review of the RRT decision was dismissed in the Federal Magistrates Court of Australia on 28 July 20082, as was a subsequent appeal to the Full Court 2 SZMCD v Minister for Immigration and Citizenship (2008) 219 FLR 141. of the Federal Court of Australia by a decision delivered on 15 April 20093. Special leave to appeal to this Court was refused on 4 September 20094. On 30 October 2009, Plaintiff S10 requested that the Minister exercise his power under s 417 of the Act and, alternatively, under s 48B of the Act. His request in relation to s 48B was not referred to the Minister, a departmental officer having determined that it did not meet the ministerial guidelines relating to s 48B. His request for consideration under s 417 was referred to the Minister who signed a minute indicating that he did not wish to consider the exercise of that power. In these proceedings, Plaintiff S10 complains of a breach of procedural fairness in relation to his s 48B request on the basis that he was not given the opportunity to comment on materials relied upon by the departmental officer, and that the officer failed to address the material and claim before him. That breach of procedural fairness, it is said, also infected the way in which the Minister and his Department dealt with his s 417 request. Ms Kaur arrived in Australia on a Subclass 573 (Higher Education Sector) visa on 21 July 2005 and on 28 June 2006 was relevantly granted a further student visa valid until 6 June 2008. An application for a further student visa, lodged on 1 September 2008, was refused by a delegate of the Minister on the basis that it had not been lodged within 28 days of her previous substantive visa ceasing to be in effect. The MRT affirmed the delegate's decision and, on 16 October 2009, Ms Kaur requested that the Minister exercise his power under s 351 of the Act. Her request was referred to the Minister who determined that he did not wish to consider the exercise of that power. An application to the Federal Magistrates Court for judicial review of the MRT's decision was dismissed5. So too was an appeal against that decision to the Federal Court6. Both Barnes FM in the Federal Magistrates Court7, and Jacobson J in the Federal Court8, noted that Ms Kaur's visa grant letter was confusing and that she had acted on advice given to her by her migration agent. 3 SZMCD v Minister for Immigration and Citizenship (2009) 174 FCR 415. 4 SZMCD v Minister for Immigration and Citizenship [2009] HCATrans 211. 5 Kaur v Minister for Immigration and Citizenship [2010] FMCA 634. 6 Kaur v Minister for Immigration and Citizenship [2010] FCA 1319. [2010] FMCA 634 at [7]-[12]. [2010] FCA 1319 at [7], [62]-[64]. On 20 December 2010, Ms Kaur submitted a further request to the Minister seeking the exercise of his power under s 351 of the Act. The relevant departmental officers declined to refer the request to the Minister. In these proceedings, Ms Kaur complains of a breach of procedural fairness in the failure of officers assessing her repeat request to invite her to comment on a statement in an email from an officer of the Department, dated 6 January 2011. That email stated that the repeat request was based almost primarily on a comment which the Federal Court had made in its judgment suggesting that it might be a case that the Minister would look at a second time. Plaintiff S49 Plaintiff S49 arrived in Australia on a visitor visa on 8 June 1998. He applied for a protection visa on 21 July 1998 claiming to be a citizen of India subject to persecution in that country on political grounds. His application was refused in August 1998, and that refusal was affirmed by the RRT on 5 April 2001. An application for judicial review of the RRT decision was withdrawn. In June 2003, Plaintiff S49 was taken into immigration detention and on 25 June 2003 applied to this Court for judicial review of the RRT's decision. He then claimed that he was a citizen of Bangladesh and that he had previously given an incorrect name. The application was remitted to the Federal Court9 where Plaintiff S49's attempt to seek judicial review was unsuccessful10. On 6 September 2004, Plaintiff S49 requested that the Minister exercise her discretion "for humanitarian reasons", apparently referring to the Minister's power under s 417 of the Act. On 9 November 2004, the Minister signed a minute indicating that she did not propose to consider the exercise of her power. Plaintiff S49 subsequently informed the Department that his identity was as first claimed and that he wished to return to India. He was granted a "Removal Pending Bridging Visa" pursuant to s 195A of the Act and released from immigration detention on 3 November 2005. His request for the Minister to exercise power under s 48B of the Act was found, on 22 December 2005, not to meet the guidelines. On 3 March 2006, he was issued with a travel document to 9 Callover of 30 Immigration Matters – Sydney [2003] HCATrans 324 (25 August 10 S372 of 2003 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 1785. India and arrangements were made for him to depart Australia on 30 August 2006. The Minister decided to cancel his bridging visa on 26 July 2006 and notified him of that decision by letter dated 15 August 2006. He sought judicial review of the cancellation and obtained an injunction restraining his removal from Australia pending the outcome of that review11. He unsuccessfully pursued the matter in the Federal Magistrates Court12 and the Federal Court13, renewing his claim that he was a Bangladeshi national. On 15 June 2009, Plaintiff S49 again requested the Minister to exercise his power under s 417 and, alternatively, under s 48B of the Act. Departmental officers subsequently assessed his request as not falling within the ministerial guidelines relating to s 48B. On 25 November 2010, the Minister decided to "not intervene" in respect of the request that he exercise his power under s 417 of the Act. The "not intervene" option in the minute signed by the Minister was an alternative to "begin considering" and may be taken to have been a refusal to consider the exercise of the power. Plaintiff S49 alleges breach of procedural fairness in relation to his repeat requests under ss 48B and 417 of the Act. Plaintiff S51 Plaintiff S51, a citizen of Nigeria, arrived in Australia on a short stay business visa on 29 August 2009. That visa was cancelled upon his arrival on the basis he was not a genuine business entrant and he was taken into immigration detention. He has remained in detention or community detention since his arrival in Australia. Plaintiff S51 lodged an application for a protection visa in September 2009 alleging that he would be subject to persecution in Nigeria because of his Christian religion. His application was refused on 3 November 2009. The RRT affirmed that refusal. An application for judicial review of the RRT's decision was dismissed by the Federal Magistrates Court on 5 July 201014 and an appeal from that decision dismissed by the Federal Court on 3 September 201015. In the 11 Kumar v Minister for Immigration and Multicultural Affairs [2006] FMCA 1276. 12 Kumar v Minister for Immigration and Citizenship [2008] FMCA 1099. 13 Kumar v Minister for Immigration and Citizenship (2009) 176 FCR 401. 14 SZOET v Minister for Immigration [2010] FMCA 483. 15 SZOET v Minister for Immigration and Citizenship [2010] FCA 968. meantime, in December 2009, Plaintiff S51 was assessed under the ministerial guidelines relating to s 195A for possible referral to the Minister for the grant of a bridging visa while his protection visa process was ongoing. In the event, although the assessment recorded that he had been diagnosed with post-traumatic stress disorder and was at risk of further deterioration if he remained detained, no referral of the assessment was made to the Minister. On 5 October 2010, Plaintiff S51 sought the exercise by the Minister of his discretion under either s 48B or s 417 of the Act. Departmental officers declined to refer the s 48B request to the Minister. His request under s 417 was referred to the Minister who noted that there was enough evidence to warrant further consideration and ticked a box indicating that a submission was required. After the receipt of further material from Plaintiff S51 and a further departmental submission to the Minister, the Minister signed a record, on 16 December 2010, to the effect that he would "not intervene" in relation to Plaintiff S51's request. The form of the minute signed by the Minister again indicates that he refused to further consider the exercise of his powers. Plaintiff S51 commenced the present proceedings on 1 February 2011. He made a further request for the Minister to exercise his powers under ss 417 and 48B of the Act, but those requests were treated as inappropriate to consider having regard to the pending proceedings. A subsequent departmental submission to the Minister relating to possible intervention under s 195A and s 197AB of the Act led the Minister to sign a record stating that he would "not intervene" in relation to s 195A, but would consider the exercise of his power under s 197AB of the Act to place Plaintiff S51 in community detention. It is common ground that Plaintiff S51 is now in community detention. Plaintiff S51 complains of want of procedural fairness in relation to the Minister's consideration of the exercise of the discretion under s 195A, and the assessment of Plaintiff S51's request that the Minister exercise his powers under ss 48B and 417. Statutory framework The Act classifies non-citizens, within Australia's migration zone16, as lawful non-citizens being those who hold a visa17, and unlawful non-citizens 16 Section 5 of the Act defines migration zone as "the area consisting of the States, the Territories, Australian resource installations and Australian sea installations". 17 Act, s 13(1). being those who are not lawful non-citizens18. Subject to the Act, the Minister may grant a non-citizen permission, to be known as a visa, to travel to and enter into Australia and/or remain in Australia19. There are classes of visas prescribed by the Migration Regulations 1994 (Cth)20 ("the Regulations"), and provided for by particular sections of the Act21. The Regulations may prescribe criteria for classes of visa22. Three of the plaintiffs had applied for and been refused a protection visa, for which s 36 provides. A criterion for a protection visa is that the applicant is "a non-citizen in Australia to whom the Minister is satisfied Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol"23. The other plaintiff, Ms Kaur, applied for a student visa designated in the Regulations as a Subclass 573 (Higher Education Sector) visa. Part 5 of the Act provides for administrative review of decisions to refuse the grant of visas (other than protection visas) by the MRT. Part 7 of the Act provides for review by the RRT of decisions to refuse the grant of protection visas. Decisions of those Tribunals are amenable to judicial review for jurisdictional error in the Federal Magistrates Court, subject to appeal to the Federal Court, and, by special leave, to this Court24. They are also subject to applications for constitutional writs and for certiorari as an incident of such applications, which are made in the original jurisdiction conferred on this Court by s 75(v) of the Constitution. The provisions of the Act in issue in these proceedings are ss 48B, 195A, 351 and 417. Section 48B authorises the Minister to determine that a statutory bar imposed by s 48A upon a further application for a protection visa, where a 18 Act, s 14(1). 19 Act, s 29(1). 20 Act, s 31(1). 21 Act, s 31(2). 22 Act, s 31(3). 23 Act, s 36(2)(a). Under s 5 of the Act, the "Refugees Convention" means the Convention relating to the Status of Refugees done at Geneva on 28 July 1951, and the "Refugees Protocol" means the Protocol relating to the Status of Refugees done at New York on 31 January 1967. 24 Act, Pt 8, Div 2. previous application has been refused, does not apply to prevent such an application. Section 195A authorises the Minister to grant to an unlawful non- citizen detained under s 189 "a visa of a particular class (whether or not the person has applied for the visa)."25 Section 351 empowers the Minister to substitute for a decision of the MRT, reviewing the cancellation of a visa or a refusal to grant a visa, "another decision, being a decision that is more favourable to the applicant, whether or not the Tribunal had the power to make that other decision."26 Section 417 confers a similar power on the Minister with respect to the decisions of the RRT, which relate to protection visas. Decisions under ss 48B, 195A, 351 and 417 ("the dispensing provisions") attract the application of the privative provision, s 474 of the Act27, which seeks to preclude judicial review of "privative clause decisions" to which it applies. That preclusion does not extend to decisions affected by jurisdictional error28. Each of the dispensing provisions has common features affecting the exercise of the power it confers: the Minister must think it is in the public interest to exercise the power29; the power may only be exercised by the Minister personally30; 25 Act, s 195A(2). 26 Act, s 351(1). 27 Act, s 474(7)(a), which includes in the class "privative clause decision" to which the section applies, decisions of the Minister not to exercise, or not to consider the exercise, of the Minister's power under ss 48B, 195A, 351 and 417. 28 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476; [2003] HCA 2. 29 Act, ss 48B(1), 195A(2), 351(1), 417(1). 30 Act, ss 48B(2), 195A(5), 351(3), 417(3). the Minister does not have a duty to consider whether to exercise the power, whether he or she is requested to do so by the applicant or by any other person or in any other circumstance31; in exercising the power the Minister is not bound by subdiv AA or AC of Div 3 of Pt 2 of the Act or by the Regulations, but is bound by all other provisions of the Act32; if the Minister does exercise the power the Minister must cause to be laid before each House of Parliament a statement setting out, inter alia, the Minister's decision and the reasons for the Minister's decision and, in particular, the Minister's reasons for thinking that the decision was in the public interest33. As was pointed out in the written submissions filed by the Minister and the Secretary, ss 48B and 417 cannot be invoked in favour of a non-citizen unless the non-citizen has applied for a protection visa and had that application determined. A further condition upon the invocation of s 417 is that the non- citizen has applied to and been the subject of a decision by the RRT. Section 351 only applies to a non-citizen who has made an application for a visa, had the application determined, applied for review before the MRT, and had that application determined. The antecedent processes for application and review attract procedural fairness obligations subject to the specific provisions of the Act relating to its content. The dispensing provisions and other like provisions in the Act have a distinctive function in its legislative scheme. The Act creates a range of official powers, duties and discretions, particularly in relation to the grant of visas, which are tightly controlled by the Act itself and, under the Migration Regulations, by conditions and criteria to be satisfied before those powers and discretions can be exercised34. The dispensing provisions stand apart from the scheme of tightly controlled powers and discretions. They confer upon the Minister a degree of flexibility allowing him or her to grant visas which might not otherwise be able to be granted because of non-satisfaction of substantive or procedural 31 Act, ss 48B(6), 195A(4), 351(7), 417(7). 32 Act, ss 195A(3) (which also excludes the operation of subdiv AF of Div 3 of Pt 2), 351(2), 417(2). Section 48B is located in subdiv AA of Div 3 of Pt 2 of the Act. 33 Act, ss 48B(3), 195A(6), 351(4), 417(4). 34 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 494 [36] per requirements. The powers so conferred are conditioned upon a ministerial judgment of the "public interest". That is a term to which it is difficult to give a precise content35. It has been described in this Court as36: "a discretionary value judgment to be made by reference to undefined factual matters, confined only 'in so far as the subject matter and the scope and purpose of the statutory enactments may enable … given reasons to be [pronounced] definitely extraneous to any object the legislature could have had in view'". The dispensing provisions require the Minister to be personally accountable to the Parliament for decisions to grant visas made under them. Both the wide purposes for which the powers conferred by the dispensing provisions can be exercised and their non-compellable nature, indicate that they cannot be enlivened by a request for their exercise nor by the existence of circumstances which might be thought, in the public interest, to attract their application. The dispensing provisions do not in terms provide for applications or requests for the exercise of a ministerial discretion. Nevertheless, they are drafted on the assumption, which recognises the practical reality, that requests will be made. They provide that the Minister has no duty to consider whether to exercise the power they confer, whether or not requested to do so. Other provisions of the Act operate upon the assumption that such requests will be made37 and that representations and communications will be made to the Minister, the Minister's staff or officers of the Department in relation to such requests38. The Regulations provide for the grant of Subclass 050 (Bridging (General)) visas which permit a non-citizen to remain in, or travel to, enter and remain in Australia, during a specified period or until a specified event 35 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300 [57] per Gleeson CJ, Gummow, Heydon and Kiefel JJ; [2008] HCA 37. 36 O'Sullivan v Farrer (1989) 168 CLR 210 at 216 per Mason CJ, Brennan, Dawson and Gaurdon JJ; [1989] HCA 61, quoting Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 505; [1947] HCA 21. See also Osland v Secretary, Department of Justice (No 2) (2010) 241 CLR 320 at 329- 330 [13]-[14] per French CJ, Gummow and Bell JJ; [2010] HCA 24. 37 "Immigration assistance", regulated by Pt 3 of the Act, is defined to include "preparing, or helping to prepare, a request to the Minister" to exercise the power under ss 195A, 351 and 417: Act, s 276(2A). See also s 277(4)-(5) relating to lawyers providing advice for the purpose of making such requests. 38 Act, s 282(4). happens39. Primary criteria for the grant of a bridging visa include the making of a request to the Minister to make a determination under s 48B of the Act40 and the making of a request under ss 351 or 41741. The recognition in the Act of the fact that requests will be made for ministerial consideration of the exercise of the powers under the dispensing provisions does not have any significance for the question whether such requests, when made, enliven a statutory process attended by the requirements of procedural fairness. As appears from these reasons, the answer to that question is in the negative. Ministerial guidelines Three sets of ministerial guidelines have been issued from time to time with respect to the exercise of the Minister's powers under s 48B, s 195A, and ss 351 and 417. Guidelines relating to the implementation of s 48B were first issued in 1999. Guidelines with respect to s 195A were issued on 18 October 2007 and with respect to ss 351 and 417 with effect from 5 December 2008. Each set of guidelines has been adopted by successive Ministers subject to minor amendments. The ministerial guidelines in effect on 16 November 2010 with respect to the exercise of ministerial powers under ss 351 and 417 of the Act were included in a Centralised Departmental Instruction System. They were cast in the first person as instructions from the Minister. Their stated purposes were to: explain the circumstances in which I may wish to consider exercising my public interest powers under … s351 …[or] s417 … of the Act to substitute for a decision of a review tribunal a decision which is more favourable to the visa applicant(s) explain how a person may request my consideration of the exercise of my public interest powers and inform departmental officers when to refer a case to me so that I can decide whether to consider exercising such powers in the public interest." 39 Act, s 73. 40 Regulations, Sched 2, sub-cl 050.212(5B). 41 Regulations, Sched 2, sub-cl 050.212(6). The powers conferred by ss 351 and 417 were designated as "PUBLIC INTEREST POWERS". The guidelines set out types of cases which the Minister considered "inappropriate to consider" and which could be "finalised without further assessment." They included repeat requests where migration-related litigation was pending. Classes of case which were to be brought to the Minister's attention were identified. They comprised cases referred to the Minister by a review tribunal member and cases involving "unique or exceptional circumstances". Categories of circumstances answering the latter description were set out. They included circumstances in which there was a "significant threat" to the personal security, human rights or human dignity of a person and cases in which there were substantial grounds for believing that a person might be in danger of being subject to torture if returned to their country of origin, in contravention of the Convention Against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment. The guidelines set out information which should be brought to the Minister's attention for consideration where a case was assessed as involving unique or exceptional circumstances. That information included whether the continued presence of the person in Australia would pose a threat to an individual in this country, or to Australian society or security, or might prejudice Australia's international relations. The guidelines concluded with the observation that: "A request for me to exercise my public interest powers is not an application for a visa and, unless the request leads to grant of a bridging visa, such a request has no effect on the removal provisions." The purpose of the Minister's guidelines with respect to s 195A of the Act, relating to the discretion to grant a visa to a person in immigration detention, was similar to the stated purpose of the guidelines relating to ss 351 and 417. It was explain the circumstances in which I may wish to consider exercising my public interest power under s 195A … inform officers of the Department of Immigration and Citizenship … when to refer a case to me so that I can decide whether to consider exercising this power in the public interest." The guidelines with respect to s 195A, like those issued in connection with the exercise of the powers under ss 351 and 417, set out categories of cases to be referred by the Department to the Minister for consideration of his or her "detention intervention power". Referral was to occur where a person was in immigration detention under s 189 of the Act and one or more additional criteria were met. Officers of the Department were required to assess a detainee's circumstances on an ongoing basis, and bring to the Minister's attention any case falling within the guidelines. Requests for the exercise of the Minister's detention intervention power could only be made and referred by the Department. The Minister would not consider exercising the power if requested directly by or on behalf of a detainee. If the Minister decided to consider a case under s 195A, the Minister might choose to grant, or not to grant, a visa. Under the guidelines, once the Minister has considered the exercise of the detention intervention power in relation to a particular detainee, any subsequent request was to be assessed by an officer of the Department. However, a subsequent request would only be brought to the Minister's attention for reconsideration if new information was available or circumstances had changed. The structure of the guidelines relating to s 48B was similar to that of the guidelines issued in relation to ss 351 and 417 of the Act. They distinguished between requests for consideration which were to be referred to the Minister and those which were not. If a request for ministerial consideration under s 48B or any purported repeat protection visa application was made which did not fall within the guidelines, it would not be referred to the Minister. Was there a requirement for procedural fairness? The plaintiffs submitted that their requests and submissions to the Minister and the consideration of those requests by officers of the Department occurred under and for the purposes of the Act and thereby attracted the requirement to afford procedural fairness. They submitted that the nature of the Minister's powers compelled a construction of the guidelines which included an implied requirement of procedural fairness. They also argued that where officers had decided under the guidelines not to refer repeat requests to the Minister, those decisions could not be regarded as decisions of the Minister and were made without jurisdiction. Assuming, contrary to their primary submissions, that the departmental consideration of the plaintiffs' requests occurred outside the statutory framework, the plaintiffs submitted that it could only have occurred pursuant to an exercise of non-statutory executive power under s 61 of the Constitution which was constrained by a requirement to afford procedural fairness. Further, it was argued that, in any event, the officers were exercising public functions which the Court should hold were attended by a requirement to afford procedural fairness. The plaintiffs invoked the decision of this Court in Plaintiff M61/2010E v The Commonwealth ("the Offshore Processing Case")42 in support of their submissions. However that case, which concerned the application of procedural fairness in connection with the exercise of ministerial powers under ss 46A and 42 (2010) 243 CLR 319; [2010] HCA 41. 195A of the Act arose in circumstances quite different from the cases presently before the Court. The Court in that case was concerned with inquiries made after the Minister had decided to consider exercising his powers under those sections. On the other hand, in each of the cases currently before the Court, the Minister had declined to consider exercising the relevant power. The Offshore Processing Case applied only to detainees who were offshore entry persons. Section 46A(2) confers upon the Minister a power to lift a statutory bar imposed by s 46A(1) against applications for visas by offshore entry persons who are in Australia and are unlawful non-citizens. The structure of s 46A resembles that of s 48B. It imports the common elements of a public interest criterion43, a requirement that the Minister exercise the power personally44 and a provision that the Minister does not have a duty to consider whether to exercise the power45. In the Offshore Processing Case the Minister had announced the establishment of an offshore assessment and review process to determine claims for protection under the Refugees Convention. The effect of the announcement was that the Minister had decided that consideration would be given to exercising the powers under ss 46A and 195A in every case in which an offshore entry person claimed that Australia owed that person protection obligations46. On that basis, detention during the conduct of the assessment and review processes was held to be lawful47. The Court held that the inquiries in the assessment and review processes in issue in the Offshore Processing Case48: "were inquiries made after a decision to consider exercising the relevant powers and for the purposes of informing the Minister of matters that were relevant to the decision whether to exercise one of those powers in favour of a claimant." As a result of its characterisation of the guidelines in the Offshore Processing Case, the Court held that the principles governing the limits to the 43 Act, s 46A(2). 44 Act, s 46A(3). 45 Act, s 46A(7). 46 (2010) 243 CLR 319 at 350-351 [70]. 47 (2010) 243 CLR 319 at 351 [71]. 48 (2010) 243 CLR 319 at 351 [73]. way in which assessments and subsequent reviews were conducted were well "once it is decided that the assessment and review processes were undertaken for the purpose of the Minister considering whether to exercise power under either s 46A or s 195A, it follows from the consequence upon the claimant's liberty that the assessment and review must be procedurally fair and must address the relevant legal question or questions." There being no clear words in the statute to exclude the application of procedural fairness in the exercise of the powers conferred by ss 46A and 195A, the exercise of those powers, including the power to decide to consider the exercise of power, was to be understood as "conditioned on the observance of the principles of natural justice"51. The requirements of procedural fairness were attached, in that case, to the Minister's decision to consider whether to exercise the powers under ss 46A and 195A because that decision directly affected the rights and interests of those the subject of assessment or review. It did so because that decision, with the consequential need to make inquiries, prolonged the detention of those persons for so long as the assessment and any necessary review took to complete. As the Minister and the Secretary pointed out, there has not been, in relation to the cases presently before the Court, any ministerial announcement of the kind which applied to the assessment and review processes considered in the Offshore Processing Case. The function of the guidelines in issue in these cases was significantly different from the function of the assessment and review procedures under consideration in the Offshore Processing Case. Those were procedures which were undertaken as an incident of the exercise of a statutory power which the Minister had effectively announced was to be undertaken, namely, the power to consider whether to exercise the substantive powers conferred by ss 46A and 195A of the Act. In this case the Minister has taken no statutory step equivalent to that taken in the Offshore Processing Case. It was submitted for the Minister and the Secretary that, properly understood, each of the guidelines in this case does no more than facilitate the provision of advice to the Minister in particular cases and otherwise operate as a screening mechanism in relation to any requests which the Minister has decided are not to be brought to his or her attention. The issue of 49 (2010) 243 CLR 319 at 351-352 [73]. 50 (2010) 243 CLR 319 at 353 [77]. 51 Kioa v West (1985) 159 CLR 550 at 615 per Brennan J; [1985] HCA 81, quoted in the Offshore Processing Case (2010) 243 CLR 319 at 354 [78]. the guidelines itself did not involve a decision on the part of the Minister, acting under the relevant section, to consider the exercise of the power conferred by it. That submission should be accepted. There are variants, in public administration, of departmental processes which are anterior to the exercise of statutory powers but do not constitute or evidence their exercise. The assessment and review processes considered in the Offshore Processing Case did not fall within that category. An administrative inquiry may be undertaken and an advice prepared for the purposes of the exercise of a statutory power. If the requirements of procedural fairness constrain the exercise of that power, and the decision-maker relies entirely upon advice proffered in disregard of those requirements, then the statutory decision may be infected by jurisdictional error. An example from a time prior to the introduction of the visa system in the Act, was the relationship between the power of the Minister to determine whether a person claiming refugee status should be granted a permit under s 6A of the Act and the function of an interdepartmental committee set up to advise the Minister on the question of whether a particular person was a "refugee" within the meaning of the United Nations Convention relating to the Status of Refugees. In Minister for Immigration and Ethnic Affairs v Mayer52, s 6A of the Act was held by implication to confer on the Minister the function of determining whether a person had the status of a refugee for the purpose of the grant of a permit under that section53. The Minister acted upon the advice of the interdepartmental committee. This Court held in Mayer that the Minister's determination of refugee status was made under s 6A and thereby "under an enactment" for the purposes of the Administrative Decisions (Judicial Review) Act 1977 (Cth). So characterised it attracted the obligation under s 13 of that Act for the provision of reasons for the decision. As Gummow J was to point out later in Re Yaa Akyaa and Rita Kufo v The Minister of Immigration and Ethnic Affairs54, if natural justice had been denied in the proceedings of the interdepartmental committee, the decision of the Minister or the Minister's delegate, as one made under the Act, would be in no better position – there would have been a breach of natural justice "in connection" with the making of the delegate's decision55. 52 (1985) 157 CLR 290; [1985] HCA 70. 53 (1985) 157 CLR 290 at 301-302 per Mason, Deane and Dawson JJ. 54 [1987] FCA 137. 55 [1987] FCA 137 at [36]. Breach of the rules of natural justice "in connection" with making a decision is a ground of review under s 5(1)(a) of the Administrative Decisions (Judicial Review) Act 1977 (Cth). The interdepartmental committee process considered in Mayer may be regarded as an ancestral analogue of the assessment and review process considered in the Offshore Processing Case. The latter system of assessment and review was knitted by ministerial announcement into the statutory power conferred by s 46A(2). The purpose and nature of the powers conferred by each of the dispensing provisions in these proceedings appears from their respective texts. It is clear from their terms that the Minister is under no duty to respond to a request for his or her consideration of the exercise of those powers. Nor is the Minister under a duty, independent of any such request, to consider any class of case for the exercise of those powers. With no statutory duty to consider the exercise of the Minister's powers being enlivened by a request or by the occurrence of a case to which the power might apply, no question of procedural fairness arises when the Minister declines to embark upon such a consideration. If, on ministerial instructions, certain classes of request or case are not even to be submitted to him or her for consideration, the position in law is unchanged. There is no exercise of a statutory power under the Act conditioned upon compliance with the requirements of procedural fairness. The guidelines under consideration in the present case are directions to departmental officers about the circumstances in which requests for consideration of the exercise of the Minister's powers may be referred to the Minister. The work done by officers, acting under the guidelines, involves the acquisition of information and categorisation of requests or cases. It may be regarded, for the purposes of s 61 of the Constitution, as an executive function incidental to the administration of the Act and thus within that aspect of the executive power which "extends to the execution and maintenance … of the laws of the Commonwealth." There is, however, nothing about the character of the guideline processes, as an exercise of the executive power of the Commonwealth or otherwise, that attracts to them a requirement to observe procedural fairness. In the context of this case that requirement can only have significance if it conditions the exercise of the statutory powers conferred by the dispensing provisions. The plaintiffs' submissions that the issue of ministerial guidelines in relation to the dispensing provisions involved a decision by the Minister to decide to consider the exercise of the powers conferred by those provisions, should be rejected. So too should the proposition that the processes followed under the guidelines were steps towards the exercise of the ministerial powers. There was no implied requirement that the guidelines be applied in such a way as to accord with the hearing rule aspect of procedural fairness. Conclusion Each of the applicants had access to administrative review procedures under the Act and judicial review of decisions of the MRT or the RRT as the case may be. Each had had his or her case considered personally by the Minister on at least one occasion. Those histories do not of themselves answer the legal question whether procedural fairness applied to the application of the ministerial guidelines to their requests for further consideration under the dispensing provisions of the Act. Those histories, however, involving as they do, the regular legislative scheme for dealing with visa applications, point up the special nature of the discretions created by the dispensing provisions which cannot be enlivened by request or circumstance. The applications in each case should be dismissed with costs. Crennan Bell GUMMOW, HAYNE, CRENNAN AND BELL JJ. These four applications in the original jurisdiction of this Court were heard together by the Full Court. The applications each raise questions of construction of cognate provisions of the Migration Act 1958 (Cth) ("the Act"). These provisions confer upon the Minister powers (but not duties) which are to be exercised by the Minister personally and, if exercised, dispense with requirements of the Act. Exercise of these powers is attended in each case by the statutory obligation that the Minister cause a statement to be laid before each House of the Parliament. This is a particular manifestation of that aspect of responsible government which renders individual Ministers responsible to the Parliament for the administration of their departments56. Thus, to adapt what was said57 by Gleeson CJ and Gummow J in Minister for Immigration and Multicultural "The statutory powers in question have been reposed in a political official, a member of the Executive Government, who not only has general accountability to the electorate and to Parliament, but who, in s 502, is made subject to a specific form of parliamentary accountability." The plaintiffs contend that in deciding whether or not to consider the exercise of the relevant power, and then in deciding whether or not to exercise the power, the Minister is obliged to afford natural justice or procedural fairness to any moving party. The defendants, the Minister and the Secretary, deny this construction. The provisions of the Act which confer dispensing powers of this nature and are in question are ss 48B, 195A, 351 and 417 in their application to persons in Australia who are detained under s 189(1). There is a statement of agreed facts in each application. However, it will be necessary to consider these facts in detail only if the issues of statutory construction be decided adversely to the Minister. 56 See FAI Insurances Ltd v Winneke (1982) 151 CLR 342 at 364; [1982] HCA 26. 57 With respect to s 502 of the Act. 58 (2001) 205 CLR 507 at 539 [102]; [2001] HCA 17. See also at 561 [176] per Hayne J, 584 [246] per Callinan J. Crennan Bell The plaintiffs Each plaintiff is a non-citizen who entered Australia but did not do so at an "excised offshore place"59. The result is that none of the plaintiffs is an "offshore entry person", detained under s 189(3) of the Act, to whom there applies the provisions of the Act, in particular s 46A, which were considered in Plaintiff M61/2010E v The Commonwealth (Offshore Processing Case)60. The effect of s 46A(1) was to deny to offshore entry persons, who claimed that Australia owed them protection obligations, the capacity to engage the visa provisions of the Act, including those for merits review, which would oblige the Minister, if satisfied the necessary criteria were met, to grant protection visas61. It was in this setting, which thus differs from that in the present cases, that the Court held that procedural fairness must attend the consideration by the Minister of whether to exercise the power under s 46A(2) to determine that s 46A(1) did not apply and the power under s 195A(2) to grant a visa to a person detained under s 189(3). It will be necessary to make further reference to the Offshore Processing Case later in these reasons62. The plaintiffs entered Australia respectively in 2007 (S10 of 2011), 2005 (S43 of 2011), 1998 (S49 of 2011), and 2009 (S51 of 2011). The plaintiff in S51 has remained in detention or "community detention" since his arrival in Australia. He presently is being held in community detention following a favourable determination by the Minister under s 197AB on 29 August 2011. The power conferred by s 197AB is exercisable if the Minister "thinks that it is in the public interest to do so"; no issue presently arises under s 197AB. The agreed facts show that while in Australia, the plaintiffs in S10, S49 and S51 each sought and was refused a protection visa by a delegate of the Minister. Each then sought a merits review by the Refugee Review Tribunal ("the RRT"). In respect of the plaintiffs in S10 and S51, the RRT affirmed the decision of the delegate, and subsequent applications for judicial review of the RRT decisions were unsuccessful. The plaintiffs in S10 and S51 were born in 59 This expression is defined in s 5(1) of the Act in terms which include the external Territories of Christmas Island, Ashmore and Cartier Islands, and Cocos (Keeling) Islands. 60 (2010) 243 CLR 319; [2010] HCA 41. 61 (2010) 243 CLR 319 at 333 [2]. Crennan Bell 1970 and 1974 and are respectively citizens of Pakistan and Nigeria. The plaintiff in S49 was born in 1971 and claimed to be a citizen of India who feared persecution on political grounds; he later claimed to be a citizen of Bangladesh who feared persecution if returned to that country. His application for review of the decision denying him a protection visa was refused by the RRT on 1 May 2001. There followed repeated requests for ministerial intervention under s 48B and s 417. The plaintiff in S43 was born in 1982 and is a citizen of India. She arrived in Australia on a student visa and thereafter was granted two further student visas. Her further application was refused by a delegate of the Minister on the basis that she had not lodged her application within 28 days of her then current substantive visa ceasing to be in effect. She made an application for review by the Migration Review Tribunal ("the MRT") but on 18 September 2009 the MRT notified her of its decision to affirm the decision of the delegate. Sufficient interest The "intention" of the Parliament63, expressed in s 4(2) of the Act, is that the provisions of the Act for visas be the only source of the right of non-citizens to enter or remain in Australia. The visa system thus operates to lift what otherwise would be a prohibition upon the entry of non-citizens into Australia and upon their remaining in Australia. That prohibition is supported by the provisions in the Act for detention and removal of unlawful non-citizens. The defendants' first submission is that the cases may be dismissed on the footing that the relevant dispensing provisions of the Act do not meet the requirement, for attraction of principles of procedural fairness, that the failure to exercise them is not "apt to have a substantial adverse effect on some identifiable right, interest, privilege or legitimate expectation". That submission should not be accepted. It should, however, first be noted that for the reasons given in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam64 by McHugh and Gummow JJ, Hayne J and Callinan J, the phrase "legitimate expectation" when used in the field of 63 See Lacey v Attorney-General (Qld) (2011) 242 CLR 573 at 591-592 [43]-[44]; [2011] HCA 10. 64 (2003) 214 CLR 1 at 20 [61]-[63], 27-28 [81]-[83], 36-38 [116]-[121], 45-48 [140]-[148]; [2003] HCA 6. Crennan Bell public law either adds nothing or poses more questions than it answers and thus is an unfortunate expression which should be disregarded. The phrase, as Brennan J explained in South Australia v O'Shea65, "tends to direct attention on the merits of the particular decision rather than on the character of the interests which any exercise of the power is apt to affect". Rather, the issue presented by the first submission of the defendants is to be considered by asking whether the failure by the Minister to consider the exercise and thus to exercise the dispensing powers in question is apt to affect adversely what is the sufficient interest of a party seeking the exercise of those powers in favour of that party. In Kioa v West66 Brennan J observed and, with respect, we agree: "The presumption that the principles of natural justice condition the exercise of a statutory power may apply to any statutory power which is apt to affect any interest possessed by an individual whether or not the interest amounts to a legal right or is a proprietary or financial interest or relates to reputation." Earlier in those reasons, Brennan J had said67: "There are interests beyond legal rights that the legislature is presumed to intend to protect by the principles of natural justice. It is hardly to be thought that a modern legislature when it creates regimes for the regulation of social interests – licensing and permit systems, means of securing opportunities for acquiring legal rights, schemes for the provision of privileges and benefits at the discretion of Ministers or public officials – intends that the interests of individuals which do not amount to legal rights but which are affected by the myriad and complex powers conferred on the bureaucracy should be accorded less protection than legal rights." Brennan J also made the specific point that the interests which the exercise of a power of deportation are apt to affect are such as tend to attract the protection of the principles of natural justice68. 65 (1987) 163 CLR 378 at 411; [1987] HCA 39. 66 (1985) 159 CLR 550 at 619; [1985] HCA 81. 67 (1985) 159 CLR 550 at 616-617. 68 (1985) 159 CLR 550 at 622. See also at 632 per Deane J. Crennan Bell The Act in its present form reflects a legislative awareness of what was decided in Kioa v West69. This is apparent from provisions (eg ss 51A, 357A, 422B) which specify what is said to be an exhaustive statement of the requirements of natural justice, and those (eg ss 500A(11), 501(5), 501A(4)) which specify that the rules of natural justice do not apply to certain decisions. In Kioa70 Brennan J also stated his agreement with the proposition that the interest which tends to attract the protection of the principles of natural justice may be equated with the interest which, if affected, gives "standing" at common law (and, one might add, in equity71), to seek a public law remedy. This relationship is illustrated by the point made in the Offshore Processing Case72 that each plaintiff had a real interest in raising the questions to which the declaratory relief went. It may be added that the term "standing" is but "a metaphor to describe the interest required, apart from a cause of action as understood at common law, to obtain various common law, equitable and constitutional remedies"73. Further, in federal jurisdiction, questions of standing are subsumed within the constitutional requirement of a "matter"74. The present cases, of course, engage the exercise of federal jurisdiction. A non-citizen who is in the position of the plaintiffs and seeks the engagement and favourable exercise of the dispensing powers under the federal statute with which these cases are concerned does so to obtain a measure of relaxation of what otherwise would be the operation upon non-citizens of the visa 69 (1985) 159 CLR 550. 70 (1985) 159 CLR 550 at 621. 71 See the discussion by Gaudron J in Corporation of the City of Enfield v Development Assessment Commission (2000) 199 CLR 135 at 157-158 [57]-[58]; [2000] HCA 5. 72 (2010) 243 CLR 319 at 359 [103]. See also Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 34-36 [45]-[52], 68-69 [150]-[158]; [2009] HCA 23. 73 Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 174 [15]; [2001] HCA 58. 74 Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 35 [50]-[51], 68 [152], 99 [272]-[273]; Stellios, The Federal Judicature: Chapter III of the Constitution Commentary and Cases (2010) §7.7. Crennan Bell system; it is the requirements of that system which must be met to lift what otherwise are the prohibitions upon entry and continued presence in Australia. This is sufficient to satisfy the principles just discussed. The defendants cannot succeed solely upon the ground that the failure to engage the exercise in their favour of the dispensing power, is not apt adversely to affect the interests of those seeking to engage the exercise of those powers. There remains the second ground upon which the defendants put their case. This proceeds upon the footing that it is a question of construction whether "a statutory power is conditioned on the observance of the principles of natural justice", so that "[i]t is therefore possible to state … in reference to a given statutory power that its exercise is never conditioned on the observance of the principles of natural justice". The words are those of Brennan J in Kioa v West75. Before further consideration of this branch of the argument, it is necessary to say something more of the structure of the visa system established by the Act and then of the dispensing provisions. The visa structure Part 2 Div 3 (ss 28-140) of the Act is headed "Visas for non-citizens" and comprises subdivs A-H. Subdivision A (ss 28-43) is headed "General provisions about visas". Section 29(1) is a central provision. It states: "Subject to this Act, the Minister may grant a non-citizen permission, to be known as a visa, to do either or both of the following: travel to and enter Australia; remain in Australia." (emphasis added) Subdivision AA (ss 44-51) is headed "Applications for visas". Section 45 provides that: "Subject to this Act and the regulations, a non-citizen who wants a visa must apply for a visa of a particular class" (emphasis added). The Minister is required by s 47(3) not to consider an application that is not a valid application. Subdivision AC (ss 65-69) is headed "Grant of visas". Section 65 is to be read with s 29(1) and states that if, "[a]fter considering a valid application for a visa", the Minister is satisfied, among other matters, that the criteria 75 (1985) 159 CLR 550 at 611. Cf at 585 per Mason J. Crennan Bell prescribed by the Act or the regulations have been satisfied, the Minister "is to grant the visa", or, "if not so satisfied, is to refuse to grant the visa". Part 5 (ss 337-393) provides for review by the MRT and Pt 7 (ss 410-473) for review by the RRT of protection visa decisions. It should be emphasised that not all decisions by a delegate of the Minister to refuse to grant a non-citizen a visa will be reviewable by the MRT or the RRT. A decision made in relation to a non-citizen who is not physically present in the "migration zone"76 when the decision is made will not be reviewable by the RRT (s 411(2)). Decisions refusing other visas which can only be granted if the applicant is outside Australia when the visa is granted will not be reviewable by the MRT77. The principles of procedural fairness applicable in such cases which lie outside the RRT and MRT system were considered in Saeed v Minister for Immigration and Citizenship78. However, as will appear, the visa decisions with which the present cases are concerned were within the scope of the RRT or the MRT systems for merits review. Part 5 Div 5 (ss 357A-367), in respect of the MRT, and Pt 7 Div 4 (ss 422B-429A), in respect of the RRT, provided for the procedures for the conduct of reviews by those bodies79. The dispensing provisions Section 48A The effect of s 48A is that a non-citizen who, while in the migration zone has made an application for a protection visa which has been refused, may not make a further application for a protection visa while in the migration zone. However, s 48B confers upon the Minister a power to lift what otherwise would be the bar imposed by s 48A upon a further application by a particular non-citizen. Section 48B states: 76 Defined in s 5(1) so as primarily to identify the Australian mainland and external Territories. 77 See Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252 at 256-257 [4]-[6]; [2010] HCA 23. 78 (2010) 241 CLR 252. 79 See Minister for Immigration and Citizenship v SZIZO (2009) 238 CLR 627 at 639 [32]; [2009] HCA 37. Crennan Bell If the Minister thinks that it is in the public interest to do so, the Minister may, by written notice given to a particular non-citizen, determine that section 48A does not apply to prevent an application for a protection visa made by the non-citizen in the period starting when the notice is given and ending at the end of the seventh working day after the day on which the notice is given. (2) The power under subsection (1) may only be exercised by the Minister personally. If the Minister makes a determination under subsection (1), he or she is to cause to be laid before each House of the Parliament a statement that: sets out the determination; and sets out the reasons for the determination, referring in particular to the Minister's reasons for thinking that his or her actions are in the public interest. (4) A statement under subsection (3) is not to include: the name of the non-citizen; or any information that may identify the non-citizen; or if the Minister thinks that it would not be in the public interest to publish the name of another person connected in any way with the matter concerned – the name of that other person or any information that may identify that other person." (5) A statement under subsection (3) is to [be] laid before each House of the Parliament within 15 sitting days of that House after: if the determination is made between 1 January and 30 June (inclusive) in a year – 1 July in that year; or the determination is made between 1 July and 31 December (inclusive) in a year – 1 January in the following year. (6) The Minister does not have a duty to consider whether to exercise the power under subsection (1) in respect of any non-citizen, Crennan Bell whether he or she is requested to do so by the non-citizen or by any other person, or in any other circumstances." Section 195A Division 7 of Pt 2 (ss 188-197AG) is headed "Detention of unlawful non-citizens". An understanding of the scope of s 195A is assisted by the statement in s 195A(1) that the succeeding provisions apply to those in detention under s 189. "Detain" is defined in s 5(1) as meaning to take into "immigration detention" (itself defined in s 5(1)) or to keep or to cause to be kept in such detention. Section 189 is directed to "officers"80 and lists in sub-ss (1)-(4) four categories of cases where an officer "must", (sub-ss (1) and (2)), or "may", (sub-ss (3) and (4)), detain persons. The Offshore Processing Case, as explained earlier in these reasons under the heading "The plaintiffs", dealt with detention of persons found in "an excised off-shore place" (s 189(3)). The present plaintiffs are not such persons. Persons to whom s 189(3) or s 189(4) applies may not apply for a visa. That is the effect of par (c) of s 193(1). These cases concern only unlawful non-citizens detained under s 189(1). Section 189(1) requires an officer who "knows or reasonably suspects that a person in the migration zone (other than an excised offshore place) is an unlawful non-citizen" (ie a person who does not hold a visa that is in effect81), to detain that person. Persons detained under s 189(1) may apply for a visa and engage the review processes in respect of that application. Certain detainees under s 189(1) may apply for a visa which is not a bridging visa or a protection visa only within the periods specified in s 195. However, that temporal restriction is not imposed upon s 189(1) detainees who are identified in pars (a), (b) or (d) of s 193(1). But, there remains the general distinction between s 189(1) and the s 189(3) detainees considered in the Offshore Processing Case. This distinction is that of any s 189(1) detainee it can be said that the detainee has or could have applied for a visa and on refusal has engaged or could have engaged the review processes of the Act. 80 The term "officer" is defined in s 5(1) so as to include certain officers of the Minister's Department, Customs officers, protective service officers and police officers. 81 See ss 13 and 14. Crennan Bell Sub-sections (2), (3), (4) and (5) of s 195A state: "Minister may grant visa If the Minister thinks that it is in the public interest to do so, the Minister may grant a person to whom this section applies a visa of a particular class (whether or not the person has applied for the visa). In exercising the power under subsection (2), the Minister is not bound by Subdivision AA, AC or AF of Division 3 of this Part or by the regulations, but is bound by all other provisions of this Act. Minister not under duty to consider whether to exercise power The Minister does not have a duty to consider whether to exercise the power under subsection (2), whether he or she is requested to do so by any person, or in any other circumstances. Minister to exercise power personally The power under subsection (2) may only be exercised by the Minister personally." Sub-section (2) of s 195A is an important provision. It makes it clear that the Minister may grant to any person detained under any branch of s 189 a visa of a particular class, whether or not the detainee has applied for the visa. (Thus, s 195A applies to persons detained under s 189(3), being offshore entry persons whose position was considered in the Offshore Processing Case, and who otherwise are denied by s 46A(1) the capacity to engage the visa provisions of the Act.) With respect to s 195A(3), Pt 2 Div 3 subdiv AA deals with the making of applications (and includes s 48A), subdiv AC deals with the granting of visas (and includes s 65), and subdiv AF deals with bridging visas. The Minister is not bound by these subdivisions in exercising the power conferred by s 195A(2). Sub-sections (6), (7) and (8) of s 195A deal with the tabling of statements by the Minister. Sections 351 and 417 The other two cognate provisions whose construction is in issue are ss 351 and 417. They apply respectively to decisions of the MRT and RRT and are in Crennan Bell relevantly indistinguishable terms. Sub-sections (1), (2), (3) and (7) of s 417 state: If the Minister thinks that it is in the public interest to do so, the Minister may substitute for a decision of the Tribunal under section 415 another decision, being a decision that is more favourable to the applicant, whether or not the Tribunal had the power to make that other decision. In exercising the power under subsection (1) on or after 1 September 1994, the Minister is not bound by Subdivision AA or AC of Division 3 of Part 2 or by the regulations, but is bound by all other provisions of this Act. (3) The power under subsection (1) may only be exercised by the Minister personally. (7) The Minister does not have a duty to consider whether to exercise the power under subsection (1) in respect of any decision, whether he or she is requested to do so by the applicant or by any other person, or in any other circumstances." Sub-sections (4), (5) and (6) of s 417 deal with tabling requirements and the text need not be set out here. Both ss 351 and 417 empower the substitution of a decision of the relevant Tribunal for a decision more favourable to the applicant, whether or not the Tribunal had the power to make such a decision. Like s 195A, ss 351 and 417 empower the Minister to dispense with the requirements of subdivs AA and AC of Div 5 of Pt 2, and thus with the requirements of a valid visa application to be considered by the Minister. The result is that a visa may be granted to a person who does not satisfy the requirements for the grant of a visa. The powers of the Minister given by these sections differ radically from other powers given by the Minister with respect to the grant of visas. The central difference between these powers and the other powers the Act gives the Minister to deal with visas are that the Act obliges82 the Minister to consider any valid 82 Section 47(1). Crennan Bell application for a visa and, if the prescribed conditions are met, the Minister must grant83 the visa that is sought. These matters of construction are not in dispute. What is in dispute is whether, on the proper construction of the Act, some or all of the dispensing provisions invoked by the plaintiffs excluded any obligation upon the Minister to accord procedural fairness to them. The plaintiffs' requests The plaintiffs in S10 and S49 sought unsuccessfully the engagement and exercise by the Minister of powers under s 48B and s 417. The plaintiff in S51 unsuccessfully sought the engagement and exercise of the Minister's powers under s 48B and s 195A. The plaintiff in S43 sought unsuccessfully the engagement and exercise of the Minister's power under s 351. In some instances, officers of the Minister's department found that the request made did not meet the criteria in "guidelines" issued by the Minister, and, as stipulated in the guidelines, the request was not referred to the Minister. In the case of the plaintiffs in S10, S49 and S51, the request had been in respect of s 48B, and in the case of the plaintiff in S43 the request had been in respect of s 351. The plaintiffs seek relief quashing those decisions, attributed to the second defendant, the Secretary. In respect of the other requests the Minister himself considered that it would not be in the public interest to intervene and consequently did not exercise the relevant dispensing powers. The guidelines Three sets of guidelines were material. The first was applicable to the exercise of powers, inter alia, under s 351 and s 417, the second to s 48B, and the third to s 195A. The term "guidelines" is apt to mislead; their content is in the form of directions by the Minister. The first and third guidelines state as a purpose the desire of the Minister to inform departmental officers "when to refer a case to me so that I can decide whether to consider exercising such powers in the public interest"; and "to explain the circumstances in which I may wish to consider exercising my public interest powers [under s 351, s 417, s 195A as the case may be]". The s 48B guidelines are said to be for use "when considering whether to forward to the Minister cases that the Minister may wish to consider 83 Section 65. Crennan Bell when using the ministerial non-compellable and non-delegable power [under s 48B]". The terms of the guidelines provide criteria to distinguish between requests which will not be referred to the Minister and those which may be referred to the Minister for consideration whether to exercise the relevant power. By these directions the Minister has determined in advance the circumstances in which he or she wishes to be put in a position to consider exercise of the discretionary powers by the advice of department officers. It was within the competence of the Minister to do so84. The effect, as the Commonwealth Solicitor-General put it in oral argument, is that the adoption of the guidelines by the Minister represents decisions by the Minister that if a case is assessed as not meeting the guidelines, the Minister does not wish to consider the exercise of the dispensing power, and if a case is assessed favourably then the Minister does wish to consider that exercise. The constitutional issue The plaintiffs made a submission on the footing that the inquiries made in the course of the assessment processes were divorced from any authority conferred by the Act. The effect of the submission was that (a) the only other source of authority was the executive power identified in s 61 of the Constitution, and (b) an obligation to act with procedural fairness attended the exercise of that power in making the inquiries in the course of the assessment processes. The issues which then could arise were adverted to by Gaudron and Gummow JJ in Re Refugee Tribunal; Ex parte Aala85, but it was unnecessary to pursue them further in that case. Likewise in the present cases, because, as indicated above, the assessment processes required by the Minister under the guidelines were not divorced from the exercise of authority conferred by statute. Accordingly, it is unnecessary to embark upon consideration of the submissions in opposition to the plaintiffs which were put by the defendants or upon those of South Australia in its intervention. 84 Bedlington v Chong (1998) 87 FCR 75 at 80-81; Raikua v Minister for Immigration (2007) 158 FCR 510 at 522-523 [63]-[66]. No question arises of the application of an "unpublished" Ministerial policy or guidelines inconsistent with "published" policy or guidelines; cf R (WL (Congo)) v Secretary of State for the Home Department [2012] 1 AC 245. 85 (2000) 204 CLR 82 at 101 [42]; [2000] HCA 57. Crennan Bell However, by means of the guidelines it is not possible to obviate the need to observe any requirements of procedural fairness if, on the proper construction of the Act, such requirements do arise. To that subject we now turn. The submissions The plaintiffs submit that the content of the obligation to afford procedural fairness in these cases included the provision of an opportunity to be heard in relation to adverse material and in relation to any proposed departure from published guidelines, and on any adverse conclusions not obviously open on the known material, together with a prohibition upon failure to consider clearly articulated claims supported by evidence. As indicated earlier in these reasons86 under the heading "Sufficient interest", on other grounds the defendants submitted that such questions did not arise. The remaining ground is that the extraordinary nature of the dispensation provisions, with which these cases are concerned, and their exceptional place within the scheme of the Act respecting visas, provide a basis to exclude what otherwise might be an implication of procedural fairness. For the reasons which follow, that submission by the defendants should be accepted. Procedural fairness The principles and presumptions of statutory construction which are applied by Australian courts, to the extent to which they are not qualified or displaced by an applicable interpretation Act, are part of the common law. In Australia, they are the product of what in Zheng v Cai87 was identified as the interaction between the three branches of government established by the Constitution. These principles and presumptions do not have the rigidity of constitutionally prescribed norms, as the operation of interpretation statutes, but they do reflect the operation of the constitutional structure in the sense described above. It is in this sense that one may state that "the common law" usually will imply, as a matter of statutory interpretation, a indicated by 87 (2009) 239 CLR 446 at 455-456 [28]; [2009] HCA 52. See also Momcilovic v The Queen (2011) 85 ALJR 957 at 984 [38], 1009 [146], 1033 [280], 1086 [545]; 280 ALR 221 at 239-240, 274, 306, 378; Attorney-General (Qld) (2011) 242 CLR 573 at 591-592 [43]-[44]. [2011] HCA 34; Lacey Crennan Bell condition that a power conferred by statute upon the executive branch be exercised with procedural fairness to those whose interests may be adversely affected by the exercise of that power88. If the matter be understood in that way, a debate whether procedural fairness is to be identified as a common law duty or as an implication from statute proceeds upon a false dichotomy and is unproductive. It is true, as noted earlier in these reasons89, that there are some provisions in the Act which explicitly exclude the operation of the rules of natural justice. That is a matter to be taken into account in deciding whether or not, upon their proper construction, the dispensing provisions with which these cases are concerned are conditioned upon observance of the requirements of natural justice in favour of persons in the position of the plaintiffs. However, those dispensing provisions also have the following significant characteristics: The powers they confer may be exercised by the Minister personally and not otherwise; that is to say, unlike many other decisions respecting the issue of visas, the power may not be delegated by the Minister under s 496 of the Act90. (ii) By the tabling requirements the Minister is rendered accountable in an immediate sense to each House of the Parliament for exercises of the dispensing powers. (iii) The exercise of the powers is not preconditioned by the making of any request by any other person, and, if a request be made there is no requirement to consider it. (iv) The exercise of the powers is preconditioned by (a) the Minister having decided to consider whether to exercise the power in question, and (b) the 88 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 100-101 90 See Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 448-449 [175]-[176]; [2001] HCA 51. Crennan Bell Minister thinking that: "It is in the public interest" to exercise it; but the Minister is not obliged to take either step91. The expression "in the public interest" can have no fixed and precise content and involves a value judgment often to be made by reference to undefined matters92. Here the legislative supposition upon which the dispensing powers are conferred is that there will be cases in which the requirements which otherwise control the administration of the Act are not to dictate a particular outcome. (vi) Further, as to (iv), while the personal circumstances of an individual may be taken into account, they are not a mandatory relevant consideration. (vii) Rather, as the Commonwealth Solicitor-General submitted, individual interests and rights are dealt with by provisions of the Act regulating applications and providing for review of decisions concerning visas. (viii) The premise for the operation of s 48B is that there has been the refusal of a protection visa (with attendant RRT engagement) which will be final unless the Minister lifts the bar upon further applications which is lowered by s 48A; the premise for the engagement of either s 351 or s 417 is that on a merits review the relevant tribunal has determined that there is no right to the visa sought; leaving aside the categories of offshore entry persons to whom sub-ss (3) and (4) of s 189 apply, the premise for the engagement of s 195A in present cases was that the person concerned either had unsuccessfully applied for a visa or, at least, while in detention, could have done so. (ix) Against that background, it is not surprising that the focus of the four dispensation sections is upon the Minister's view of the public interest rather than upon the satisfaction of conditions for the issue of visas. Conclusions and orders The cumulative significance of the matters referred to above in (i)-(ix) is to disclose a situation akin to that identified by Brennan J in South Australia v 91 Offshore Processing Case (2010) 243 CLR 319 at 350 [70]. 92 Osland v Secretary to Department of Justice [No 2] (2010) 241 CLR 320 at 329 [13], 354 [82], 356 [92]; [2010] HCA 24. Crennan Bell O'Shea93, namely where a senior official standing at the peak of the administration of the statute is not required to give an opportunity for a hearing in every case affecting an individual who has had an opportunity of a merits review in the course of the administrative process. Upon their proper construction and in their application to the present cases, the dispensing provisions are not conditioned on observance of the principles of procedural fairness. In particular, there was no requirement to provide to the plaintiffs the opportunities to be heard which they assert in their submissions. The use in the provisions of the Act in question here of language emphatic both of the distinctive nature of the powers conferred upon the Minister (as personal, non-compellable, "public interest" powers), and of the availability of access to the exercise of those powers only to persons who have sought or could have sought, but have not established their right to, a visa is of determinative significance. It reveals the "necessary intendment" referred to in the Offshore Processing Case94 that the provisions are not attended by a requirement for the observance of procedural fairness. The result is that each application to this Court should be dismissed. The plaintiffs accept that if, as is the case, they fail upon the statutory construction issue, there is no reason why costs should not follow the event. Accordingly, each application should be dismissed with costs. 93 (1987) 163 CLR 378 at 410. 94 (2010) 243 CLR 319 at 352 [74]. Below, those sections will be called 102 HEYDON J. These cases concern ss 48B, 195A, 351 and 417 of the Migration Act 1958 (Cth) ("the Act"). Those sections give certain powers to the first the defendant ("the Minister"). "empowering provisions". The powers they confer concern unsuccessful visa applicants and, in the case of s 195A only, persons who could apply for a visa. The Minister can exercise the powers to grant visas (ss 195A, 351 and 417), or to lift a bar on applying for a visa (s 48B), if the Minister thinks it is in the public interest to do so. It is possible to analyse the exercise of those powers as involving two steps. The first step is a decision by the Minister about whether or not to consider exercising the relevant power. If the Minister does decide to consider exercising the power, the second step is a decision by the Minister as to whether or not it should actually be exercised. The crucial question These cases raise one crucial question. That question concerns the role of officers of the Minister's Department in deciding whether or not to refer to the Minister requests for a favourable exercise of the powers conferred by the empowering provisions. In these cases, each plaintiff submitted a request of this kind. Officers of the Minister's Department decided not to forward those requests to the Minister. The crucial question is: were those officers obliged to afford the plaintiffs procedural fairness in conducting their inquiries? Non-crucial questions There are other questions in these cases. They include the following. Do the empowering provisions involve the exercise of a statutory power that has what the defendants called a "substantial adverse effect on some identifiable right, interest, privilege or legitimate expectation"? Were the inquiries made by the officers of the Minister's Department made under and for the purposes of the Act? Or were they made under s 61 of the Constitution? Did the officers in fact deny procedural fairness to the plaintiffs? It is not necessary to decide these questions in the present cases. Preconditions to the empowering provisions The plaintiffs accepted that there are statutory preconditions to the exercise by the Minister of the powers that the empowering provisions confer. Under s 48B, it is a precondition that an application for a protection visa had been refused. Under s 195A, it is a precondition that a person to whom a visa may be granted is a person in detention under s 189 (whether or not the person has applied for the visa). Under s 351(1), it is a precondition that an unsuccessful application the Migration Review Tribunal. Under s 417(1), it is a precondition that an review had been made for merits unsuccessful application Refugee Review Tribunal. for merits review had been made the Thus in the circumstances of the four plaintiffs before this Court, no occasion for the Minister to consider exercising the powers conferred by the empowering provisions could arise unless the relevant plaintiff either had unsuccessfully applied for a visa under the Act, or could have applied for a visa but had not done so. The Act enabled each plaintiff to apply for a visa. Each plaintiff did apply for a visa. Each plaintiff's application was considered by departmental officers on its merits. Each application was refused. Each plaintiff applied to either the Migration Review Tribunal or the Refugee Review Tribunal for review of the relevant departmental officer's decision on the merits. Each of those applications failed. Each plaintiff then applied to either the Federal Magistrates Court or the Federal Court of Australia for judicial review. Each of those applications also failed. Each plaintiff then had a right of appeal either to the Federal Court of Australia or to the Full Federal Court of Australia. Three of them did appeal. Their appeals were unsuccessful. One of those three appellants applied for special leave to appeal to this Court. That application failed. Each of the plaintiffs took all or most of the steps they could take before requesting the Minister to exercise the powers conferred by the empowering provisions. The conventional statutory regime and the empowering provisions There are numerous contrasts between the conventional statutory regime through which each plaintiff initially attempted to gain a visa and the regime created by the empowering provisions which they are now invoking. It is convenient to mention eight of them. Applications for visas. First, the Act makes specific provision for a person seeking a visa to apply for one. Indeed, s 45 imposes a duty on a non-citizen seeking a visa to apply for a visa of a particular class. And ss 45A, 45B, 45C and 46 create criteria to be satisfied before an application can be valid. On the other hand, the Act makes no specific provision for persons seeking a favourable exercise of the Minister's powers under the empowering provisions. Duty to consider and decide applications. Secondly, s 47(1) of the Act provides that the making of a valid application for a visa creates a duty on the Minister to consider that application. And s 65 creates a duty to accept or reject the application. Thus s 65(1)(a) provides that after "considering a valid application for a visa, the Minister", subject to being satisfied in relation to various positive and negative criteria, "is to grant the visa". Section 65(1)(b) provides that "if not so satisfied", the Minister "is to refuse to grant the visa." On the other hand, the empowering provisions create no duty to make a decision one way or the other. They do not even create a duty to consider whether to make a decision. Thus s 48B(1) begins: "If the Minister thinks that it is in the public interest to do so, the Minister may …". And s 48B(6) provides: "The Minister does not have a duty to consider whether to exercise the power under subsection (1) in respect of any non-citizen, whether he or she is requested to do so by the non-citizen or by any other person, or in any other circumstances." Sections 195A(2) and (4), 351(1) and (7) and 417(1) and (7) create similar discretions for the Minister to consider whether to exercise the power. Delegation. Thirdly, the Minister's duty under s 65 may be delegated. But the powers conferred by the empowering provisions can only be exercised by the Minister personally: ss 48B(2), 195A(5), 351(3) and 417(3). This suggests that the latter powers are powers of an exceptional, last resort, or residual kind. Natural justice. Fourthly, pursuant to s 51A(1), the Minister's decision under s 65 is regulated by "an exhaustive statement of the requirements of the natural justice hearing rule" which was "exhaustive … in relation to the matters it deals with". That statement is found in Pt 2 Div 3 subdiv AB. The Act makes no provision whatsoever for a natural justice hearing rule in relation to either the Minister's decisions under the empowering provisions or the decisions of Departmental officers about referring requests to exercise those powers to the Minister. Objective fact/public interest. Fifthly, the statutory regime governing applications for visas, which each plaintiff relied on before seeking a favourable exercise of the powers conferred by the empowering provisions, calls for an assessment of whether, as a matter of objective fact, an applicant meets the criteria for grant of the visa that he or she is seeking. But the empowering provisions do not call for assessments of objective fact in the same way. Instead their exercise or non-exercise turns on whether "the Minister thinks that it is in the public interest" to exercise them. That is in sharp contrast with, for example, the requirement that an applicant for a protection visa have a well-founded fear of persecution for a reason stated in the Convention Relating to the Status of Refugees and the Protocol Relating to the Status of Refugees ("the Convention"). There, the question is not whether the ministerial delegates and members of the Refugee Review Tribunal charged with answering that question "think" that an applicant has such a fear. The question is whether that applicant actually has that fear. That is a determinate criterion. The criterion of what the Minister thinks is in the public interest is considerably wider, much more indeterminate and very impressionistic. The emancipation of the Minister in exercising the powers to grant visas under ss 195A, 351 and 417 is made explicit by, respectively, ss 195A(3), 351(2) and 417(2). Those sub-sections provide that in exercising the powers under ss 195A, 351 and 417 the Minister is not bound by the duty created in s 65 to be satisfied of various criteria before granting a visa. Further, the fact that under the empowering provisions the Minister is to attend to the public interest only means that it is open to the Minister to exclude any consideration of an individual's interests where that interest is not reflected in the public interest. Perhaps the empowering provisions go so far as to require this of the Minister; but however that may be, they do not oblige the Minister to take that type of individual interest into account. Section 65, on the other hand, is centred on a visa applicant's personal position. That contrast points against any requirement that the Minister must afford an applicant procedural fairness in exercising the powers under the empowering provisions. It also points against any requirement that officials deciding whether to refer to the Minister requests to exercise those powers must afford applicants procedural fairness. The empowering provisions do not assume that the Minister or the officials owe any duty to potential beneficiaries of the exercise of the Minister's powers. Section 65, and the provisions dealing with review of s 65 decisions, on the other hand, do. Merits review. Sixthly, an applicant for a visa whose application is rejected under s 65 has, as a general rule, a right to seek merits review from the Migration Review Tribunal or the Refugee Review Tribunal. The Act confers no right to merits review of the Minister's decisions under the empowering provisions. Natural justice on merits review. Seventhly, in relation to merits review by the Migration Review Tribunal, s 357A(1) provided that Pt 5 Div 5 was to be taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it dealt with. And in relation to merits review by the Refugee Review Tribunal, s 422B(1) provided that Pt 7 Div 4 was to be taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it dealt with. There was obviously no equivalent in relation to merits review of the Minister's decisions under the empowering provisions, for there was no merits review. Natural justice and the courts. Eighthly, when judicial review of the decisions of the Migration Review Tribunal and the Refugee Review Tribunal is undertaken by the Federal Magistrates Court or the Federal Court of Australia, it is obvious that those courts, being courts, are obliged to exercise their respective jurisdictions, and are obliged to do so in accordance with procedural fairness. The same position applies to appeals from decisions of the Federal Magistrates Court to the Federal Court of Australia and appeals from decisions of the Federal Court of Australia to the Full Court of the Federal Court of Australia. And it also applies to applications for special leave to appeal to this Court, and to appeals to this Court. There is a sharp contrast with the position of the Minister under the empowering provisions. Preliminary conclusion In short, there is a gulf between the conventional statutory regime and the empowering provisions. The conventional statutory regime turns on an application which the Minister is obliged to consider and decide, merits review, judicial review and appeal. The empowering provisions turn on the discretionary invocation of power by the Minister, not reviewable under the Act itself. Under the conventional statutory regime, the Act creates a duty to consider, a duty to decide, a duty to afford forms of procedural fairness, and a duty to apply concrete criteria. The empowering provisions create only powers to soften the rigours an adverse outcome of the former regime might create – powers depending on much vaguer and more impressionistic criteria, which are to be invoked when all else has failed. The terms in which the empowering provisions are cast and the circumstances in which the Minister's powers are to be exercised, when compared to s 65 and the provisions giving merits review, suggest that no rights to procedural fairness exist in relation to either the Minister's powers or to the activities of officials of the Minister's Department in advising the Minister whether to consider to exercise those powers, or to exercise those powers. Subject to the matters to be discussed in the next two paragraphs, the plaintiffs must therefore fail. Statutory power/executive power. The parties were in controversy about whether the inquiries made on behalf of the Minister preparatory to his decision to consider whether to exercise one of the relevant powers are to be viewed as authorised by the Act, or are instead to be viewed as derivable from the executive power of the Commonwealth, and as operating alongside but not under the Act. That controversy need not be dealt with. The statutory structure excludes any duty to give procedural fairness on the part of those who conduct preliminary inquiries in respect of requests that there be an exercise of ministerial powers under the empowering provisions. The application of such a duty to activities undertaken by officials of the Minister's Department before the Minister considers whether to exercise those powers would sit ill with the powers themselves. The structure of the Act suggests that the powers which the empowering provisions confer on the Minister need not be exercised in compliance with the rules of procedural fairness. It would be strange if the activities of officials of the Minister's Department preparatory to the Minister either deciding whether to consider exercising those powers or deciding to exercise them would have to comply with the rules of procedural fairness. Hence even if the source of the officials' powers lies outside the Act, the terms of the Act point against the application of procedural fairness. Distinguishable authority The plaintiffs contended that their cases were analogous Plaintiff M61/2010E v The Commonwealth95. There is no relevant analogy. That case concerned offshore entry persons. This case does not. That case concerned a ministerial power under s 46A of the Act and a ministerial power under s 195A in relation to offshore entry persons. This case does not. Section 46A(1) created a bar on offshore entry persons applying for protection visas in the ordinary course. Section 46A(2), however, gave power to the Minister to lift that bar if it was thought to be in the public interest to do so. In that case, the defendants submitted that Australian legislation and case law was not binding on those who had advised the Minister in relation to s 46A(2). The Court held that Australian law, including rules of procedural fairness, applied to the Minister's decision whether to lift the ban on offshore entry persons applying for protection visas in the ordinary course. If the submission of the defendants in that case had been sound, Australia would have been in breach of international obligations under the Convention. In this case, however, no such problem exists. There is no equivalent to s 46A(1) applying to preclude the plaintiffs from ever applying for protection visas. The plaintiffs not only could but did proceed along the stages of applying for protection visas, merits review, judicial review, and, in some instances, appeal, at all of which stages Australian legislation and case law applied. Orders The plaintiffs' arguments fail. The applications should be dismissed with costs. 95 (2010) 243 CLR 319; [2010] HCA 41.
HIGH COURT OF AUSTRALIA LOCKWOOD SECURITY PRODUCTS PTY LTD APPELLANT AND DORIC PRODUCTS PTY LTD RESPONDENT Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [No 2] [2007] HCA 21 23 May 2007 ORDER Appeal allowed with costs. Set aside orders 2, 3, 7 and 8 of the Full Court of the Federal Court of Australia made on 20 December 2005 and in their place order that the respondent, by itself, its directors, servants or agents or otherwise howsoever during the term of the Patent, be restrained from infringing claims 13, 14, 15, 20 and 30 of the Patent, and in particular from: importing, making, hiring, selling, supplying or otherwise disposing of or offering to make, hire, sell, supply or otherwise dispose of or using or keeping for the purpose of doing any of those things a latch assembly including without limitation the following features: a casing; a latch bolt mounted on the casing so as to be movable relative thereto between an extended latching position and a retracted release position; (iii) (vii) a first actuator operable from an inner side of the assembly to cause movement of the latch bolt to said release position; locking means operable from said inner side of the assembly to adopt an active condition and thereby render said first actuator inoperable; a second actuator operable from an outer side of the assembly to cause movement of the latch bolt to the release position; lock release means which is responsive to said operation to the second actuator so as to thereby render said locking means inactive; said locking means including detent means which is movable between an actuator locking position and an actuator release position which corresponds to said active and inactive conditions respectively of said locking means; (viii) cam means which is operable to control which of said positions is adopted by said detent means; said cam means including a cam which is movable about an axis of rotation between first and second positions of rotation so as to thereby control said detent means; and said detent means including at least one detent which moves substantially radially of said cam axis when moving between said actuator locking and release positions; and authorising another person to do any of the acts specified in sub-paragraph (a) above. The matter be remitted to the Full Court of the Federal Court to: determine the appellant's application to amend claims of the Patent by deletion of claims 1 and 12 and by consequential amendments to claims 2, 3, 4, 7 and 13; (b) make orders disposing of the costs of the appeals to that Court and the proceeding before Hely J; and (c) make further orders and determine the remaining issues, including without limitation: orders for delivery up; the issuance of a certificate of validity pursuant to s 19 of the Patents Act 1990 (Cth); and orders for damages or an account of profits. The Court orders that the appellant: prosecute expeditiously the proceedings in the Federal Court, including any application in those proceedings to amend the claims of the Patent; serve forthwith on the Commissioner of Patents a copy of these orders with a request that particulars of the orders be registered in accordance with s 187 of the Patents Act 1990 (Cth); not threaten any person with proceedings for infringement of claims 1 to 6, 12, 31 and 32 of the Patent; and not seek to amend any claims of the Patent otherwise than in the course of or in connection with the proceedings in the Federal Court. On appeal from the Federal Court of Australia Representation A J L Bannon SC with S G C Burley and C Dimitriadis for the appellant (instructed by Phillips Ormonde & Fitzpatrick) D K Catterns QC with S J Goddard and A D B Fox for the respondent (instructed by Spruson & Ferguson) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [No 2] Intellectual property – Patents – Invalidity – Lack of inventive step – Obviousness – The respondent challenged the validity of the appellant's patent on the grounds of lack of inventive step – The patent concerned a key operated door lock combining known integers – The patent included both a broad claim (a bare combination of integers) and a narrow claim (a "preferred embodiment" of those integers) – Whether the claimed combination of integers was obvious to a person skilled in the relevant art – Whether some of the patent claims were invalid for lack of inventive step. Patents – Invalidity – Lack of inventive step – Whether inventive step is to be judged by reference to the claimed combination as a whole, or by reference to the addition of an integer to a known combination – Relevance of "idea" or "problem" underlying patent to the determination of inventive step. Patents – Invalidity – Distinction between want of novelty and lack of inventive step. Patents – Invalidity – Prior art base – Meaning of "common general knowledge" – Meaning of "prior art information" in s 7(3) of the Patents Act 1990 (Cth) – Whether "prior art information" differs as between a narrow claim and a broad claim in the one patent when assessing obviousness – Meaning of "regarded as relevant" – Meaning of "ascertained" – Meaning of "understood". Patents – Invalidity – Amendment – Construction of, and relationship between, dependent claims following determination of invalidity – Whether order for amendment should be made. Evidence – Patents – Lack of inventive step – Whether the patent specification contained an "implicit corollary admission" regarding common general knowledge – Whether that admission constituted evidence of obviousness and lack of inventive step. Evidence – Patents – Prior art base – Relevance of "secondary evidence" – Weight to be given to the failure of other skilled persons (both inventive and non-inventive) to arrive at the invention. Words and phrases – "common general knowledge", "lack of inventive step", "obvious", "person skilled in the relevant art", "prior art base", "prior art information". Patents Act 1952 (Cth), s 100. Patents Act 1990 (Cth), ss 7, 18, 22, 105, 128, 138, Sch 1. GUMMOW, HAYNE, CALLINAN, HEYDON AND CRENNAN JJ. The appellant ("Lockwood") appeals from a decision of the Full Court of the Federal Court1 in favour of the respondent ("Doric"). The appeal concerns the validity of certain claims of Australian Letters Patent No 702534 ("the Patent") held by Lockwood for an invention entitled "KEY CONTROLLED LATCH". The main issue is whether those claims in the Patent lack an inventive step. The validity of the Patent in terms of whether the claims were fairly based has previously been considered, and upheld, by this Court2. Background to the invention Details of the Patent and related facts are set out in the decisions of the courts below, and in the previous decision of this Court3. For the purposes of this appeal they may be stated as follows. The Patent claims a "key controlled latch": "This invention relates to latches of the kind which are controlled by a key operable lock and which are intended for use on doors and other movable members adapted to close an access opening ... Latch assemblies for doors commonly include a turn knob or handle which is generally located at the inside of the door and which is rotated to withdraw the latch bolt into its casing. In order to improve the security of such assemblies, manufacturers have included a key operated lock which is operative to releasably hold the turn knob or handle against rotation." The specification further explains: 1 Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2005) 226 ALR 70. 2 Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2004) 217 CLR 3 See the reasons of the primary judge: Doric Products Pty Ltd v Lockwood Security Products Pty Ltd (2001) 192 ALR 306 at 310-313 [8]-[19]; the reasons of Wilcox J in the first Full Court: Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2003) 56 IPR 479 at 481-482 [5]-[12]; the reasons of this Court: Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2004) 217 CLR 274 at 279- 283 [1]-[13]; and the reasons of the Full Court: Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2005) 226 ALR 70 at 72 [8]-[13]. Callinan Crennan "Such locks are typically arranged so as to be operated from the inside of the door and are not operable from the outside of the door. In particular, key operation of the latch from the outside of the door will not release the lock. That can lead to serious problems in circumstances where the door needs to be opened urgently from the inside, particularly if the lock key has been misplaced or is not conveniently accessible. It is an object of the present invention to provide a key controlled latch which can be released from a locked condition by use of a key at the outside of the door or other member with which the latch is used." That passage in the specification loomed large on the issue of obviousness. The primary judge, Hely J, rejected Doric's submission that those words in the specification constituted an admission which supported the assertion that claim 1 was obvious on its face4. On appeal, the Full Court overturned the decision of the primary judge and inferred from that passage an "implicit 'corollary' admission" as to common general knowledge and inventive step5 which it said could be taken into account without any witness deposing to it6. The specification then describes normal latch assemblies: "[O]peration of the outer or second actuator does not affect the operation of the locking means. That locking means remains active in spite of operation of the outer actuator, and can be rendered inactive only by appropriate and deliberate operation of the locking means from the inner side of the latch assembly. It is usually the case in such prior assemblies that the locking means is key operated. That is, the locking means will generally include a key operated tumbler lock and locking mechanism connected to that lock so as to be influenced by operation of the lock. The second or outer actuator may also include a key operated tumbler lock, but in conventional assemblies of the foregoing kind operation of that lock does not influence operation of the first actuator locking means. The two locks are arranged so that one is operated from the inner side of the assembly and the other is operated from the outer side." (2001) 192 ALR 306 at 341 [201]-[202]. (2005) 226 ALR 70 at 101 [137], [140]. (2005) 226 ALR 70 at 105 [157]. Callinan Crennan During the 1980s, Lockwood produced a range of locks which were designed to be mounted on the rim of a door, such as the front door to a house. The product which preceded the lock which is the subject of the Patent was known as the "Lockwood 001": it did not contain the "safety release mechanism" which is found in the Patent. The Lockwood 001 differed from earlier locks in one important respect. Earlier rim mounted locks were relatively flat on the outside surface of the door, and consisted of a circular plate with a keyhole recess in its centre. The lock operated by a retractable bevelled latch bolt sliding in or out of a cavity in the door frame. The latch bolt could be withdrawn from the cavity, and the door opened either by inserting and turning the key in the outside keyhole or by rotating the lever or handle on the inside of the door. Each of the outside key and the inside lever or handle was described as an "actuator". The operations of the outside actuator and the inside actuator were independent of each other. In these earlier locks, if an intruder entered premises through a window, the intruder could then exit through the front door by simply turning the internal handle, and thus escape easily taking large items. In this way, while earlier locks provided outside security in that they could not be opened from the outside without a key, once a person was inside the locks provided no internal protection against someone using the door to exit the house. So, if the door were next to a glass pane, the glass could be broken and an intruder could reach inside and turn the handle to withdraw the latch bolt and open the door. The Lockwood 001 provided internal security by adding a key lock to the internal handle. When activated, this key lock prevented the internal handle from being rotated. The door could only be opened from the inside if the key for the handle had deactivated the internal lock. However, the internal lock did not operate to withdraw or prevent the withdrawal of the latch bolt: it only operated to prevent the turning of the inside handle. In the Lockwood 001 the inside and outside actuators remained independent of each other and were still the only means of effecting the withdrawal of the latch bolt. The outside actuator did not effect the activation or deactivation of the lock on the internal handle. While the lock on the inside handle provided internal security, it also had the effect of locking a person inside the house if that person did not have ready access to the key (if, for example, the key had been misplaced, or accidentally left in the outside lock). Unless a person in the house took the deliberate step of inserting the key into the inside handle and deactivating the lock, once the door Callinan Crennan closed the inside handle could not be turned in order to withdraw the latch bolt. As was said in the earlier proceedings in this Court between these parties7: "The problem was that while it was possible for an occupant of the premises to enter by unlocking the door from the outside and then to close it, the internal handle or knob remained locked until the key was used to unlock it from the inside. If the occupant failed to do this on entry, dangerous circumstances could arise. For example, an occupant, encumbered by full shopping bags, who entered by using a key from the outside, left the key in the door or misplaced it and then discovered that the door had banged shut would find it impossible to leave through the door if a fire broke out inside, or if a child were seen entering a position of danger outside." The litigation The priority date of the Patent is 14 February 1996. The application for the Patent was filed on 11 February 1997 and Lockwood was entered on the Register as the proprietor on 2 November 2000. These proceedings were commenced on 12 October 2000. The respondent to this appeal, Doric, sought relief under s 128 of the Patents Act 1990 (Cth) ("the Act") on the grounds that Lockwood had unjustifiably threatened Doric and its two distributors with infringement proceedings. Lockwood cross-claimed against Doric for infringement of the Patent; in a second cross-claim Doric sought revocation of the Patent on the basis that it was invalid. In its third further amended particulars of invalidity, Doric alleged a number of grounds: first, that the Patent was not novel, having reference to the prior art including Lockwood's own products; second, that each claim of the Patent did not involve an inventive step when compared with the prior art base as it existed before the priority date of each claim, and each claim was obvious to a person skilled in the relevant art; third, the Patent was not fairly based; fourth, the description in the specification was insufficient; fifth, certain claims lacked utility; and sixth, the description in the specification was uncertain. In 2001 the primary judge determined that of the Patent's 33 claims, some claims were invalid by virtue of a lack of novelty; and that all claims except one, constituted by drawings which claimed a preferred embodiment, were invalid for (2004) 217 CLR 274 at 281 [8]. Callinan Crennan not being fairly based on the matter described in the specification8. His Honour also found that it had not been established that any of the claims was invalid for lack of inventive step, or was obvious, having regard to what was known and used prior to the priority date of each claim9. Further, on the proper construction of its claims, the Patent was not invalid as a result of insufficiency, lack of utility, or uncertainty. The primary judge found that some claims of the Patent were infringed by Doric's products, but that other claims were not infringed10. Lockwood appealed to the Full Court of the Federal Court of Australia11 (Wilcox, Branson and Merkel JJ) ("the first Full Court") in respect of the trial judge's findings concerning fair basis and non-infringement. By a notice of contention, Doric pursued arguments relating to the invalidity of the Patent on the basis of obviousness and insufficiency. The first Full Court dismissed the appeal, holding that the Patent was invalid for lack of fair basis; no member of the Court made any determination in respect of infringement, obviousness or insufficiency12. The findings of the first Full Court relating to fair basis were set aside on Lockwood's successful appeal to this Court13. The remainder of the matters in dispute were remitted to a differently constituted Full Court (Heerey, Sundberg and Bennett JJ14) ("the Full Court") which made findings in relation to infringement, insufficiency and obviousness. It is the reasons of the Full Court dealing with obviousness or lack of inventive step, and the consequential orders, which are the subject of this appeal. (2001) 192 ALR 306 at 352 [263]. (2001) 192 ALR 306 at 333-346 [154]-[226]. 10 (2001) 192 ALR 306 at 313-327 [20]-[108]. 11 (2003) 56 IPR 479. 12 (2003) 56 IPR 479 at 496-497 [76]-[77] per Wilcox J. 13 (2004) 217 CLR 274. 14 (2005) 226 ALR 70. Callinan Crennan The Patent The Patent added an extra integer to the known Lockwood 001, being the lock release means which allowed the outside actuator (for example, the key) to have the new and additional function of deactivating the internal handle lock, as well as retaining its previous single function of withdrawing the latch bolt to permit entry. In this way, a house maintained its internal security in the absence of the homeowner, if the lock was activated before they left the house. However, the homeowner would not be inadvertently locked inside on return, because the act of turning the outside actuator (the key) to re-enter the house deactivated the internal handle lock. When describing the Patent, Lockwood emphasised that it was never the original function of the outside actuator to deactivate the internal handle lock. The specification of the Patent concludes by noting that "the present invention provides a relatively simple means for deactivating the knob locking mechanism from a position outside the door with which the latch assembly is associated". It was contended by Lockwood that when a key controlled latch which can be released from a locked condition by using a key or other member outside the door was added to a known lock assembly that constituted a combination which is a patentable invention. The Patent has 33 claims and includes an independent claim and an omnibus claim. Only some claims are relevant to the determination of this appeal. Lockwood acknowledged that, as the primary judge held15, claims 1-6, as well as claims 12, 31 and 32, are invalid for lack of novelty. Those findings of the primary judge were not the subject of any appeal to the Full Court. However, the primary judge found that these same claims 1-6, 12, 31 and 32, were not invalid on the ground of obviousness16, having regard to what was known or used before the priority date of the claims, as determined under s 7(2) of the Act. The Full Court ordered that, subject to an extant stay, claims 1-6, 12-15, 20, 21, and 30-32 be revoked for lack of inventive step by reference to s 18(b)(ii) of the Act. It was noted in the orders of the Full Court that, in the event that its appeal to this Court was successful in relation to obviousness, Lockwood reserved its right to 15 (2001) 192 ALR 306 at 352 [263]. 16 (2001) 192 ALR 306 at 341 [197], 344 [216], 346 [226]. Callinan Crennan apply for leave to amend those claims of the Patent found to be invalid for lack of novelty at first instance, being claims 1-6, 12, 31 and 3217. In supplementary oral submissions on the appeal this Court was advised that there are no circumstances in which Lockwood would seek to amend claims 1-6, 12, 31 and 32. The claims Claim 1 generally describes the invention. Throughout the proceedings below, it was convenient for claim 1 to be broken up into integers (i)-(vi), as follows: "1. A latch assembly including, [(i)] a casing, [(ii)] a latch bolt mounted on the casing so as to be movable relative thereto between an extended latching position and a retracted release position, [(iii)] a first actuator operable from an inner side of the assembly to cause movement of the latch bolt to said release position, [(iv)] locking means operable from said inner side of the assembly to adopt an active condition and thereby render said first actuator inoperable, [(v)] a second actuator operable from an outer side of the assembly to cause movement of the latch bolt to the release position, and [(vi)] lock release means which is responsive to said operation of the second actuator so as to thereby render said locking means inactive." Integer (vi) has been described throughout this litigation as the integer which embodies the "safety release mechanism". Claims 2-6 are dependent upon claim 1, and each successive claim adds a feature to those contained in the preceding claims. On appeal, it was acknowledged that the Lockwood 001 embodied integers (i)-(v), and that the new integer added through the Patent was integer (vi). Claims 7-11 are preferred embodiment claims. Their validity has been upheld by this Court in relation to fair basing. Claims 7 and 8 have been found not to have been infringed18; claims 9-11 were not alleged to have been 17 (2001) 192 ALR 306 at 352 [263]. 18 (2001) 192 ALR 306 at 324 [83], 325 [86]; upheld by the Full Court: (2005) 226 ALR 70 at 80 [58], [60]. Callinan Crennan infringed19. Although not directly in issue in this appeal, claim 7 is significant because it refers to the cam member of the inside handle lock, which is the circular component of the handle lock that moves between the activated locked position, and the deactivated unlocked position. It states: "7. A latch assembly according to any preceding claim, wherein said locking means includes a cam member which is movable between first and second positions at which said locking means is inactive and active respectively, cam biasing means urges said cam member towards said first position, and a retaining member is engagable with said cam member to thereby prevent movement of said cam member out of said second position when said locking means is in the active condition." It was determined at first instance that claim 12 failed for lack of novelty20. However, the primary judge found that claim 12 was not invalidated for lack of inventive step21. Claim 12 refers to a "detent means", which is a component which catches or prevents the movement of a mechanism. The "detent means" effects the "locking" of the inside handle lock. Claim 13, which refers to and builds upon claim 12, is the most significant claim for the purposes of this appeal concerning lack of inventive step. Claim 13 defines a "latch assembly" being a combination of extra integers, in addition to integers (i)-(vi): "[Claim 12] [(vii)] said locking means includes detent means which is movable between an actuator locking position and an actuator release position which correspond to said active and inactive conditions respectively of said locking means, and [(viii)] cam means which is operable to control which of said positions is adopted by said detent means. [Claim 13] [(ix)] said cam means includes a cam of [sic] which is movable about an axis of rotation between first and second positions of rotation so as to thereby control [(x)] said detent means, and said detent means includes at least one detent which moves substantially radially of said cam axis when moving between said actuator locking and release positions." 19 (2001) 192 ALR 306 at 325 [91]. 20 (2001) 192 ALR 306 at 352 [263]. 21 (2001) 192 ALR 306 at 343 [212]. Callinan Crennan Claim 14 depends upon claim 13, as 15 does on 14. Claims 16-19 and 22-29 also contain preferred embodiments of the Patent but they were not in issue as they were not the subject of any challenge alleging lack of inventive step. Either they were found not to have been infringed (claims 17, 22 and 23)22, or they were not alleged to have been infringed (claims 16, 18, 19, 24-29)23. These claims do not bear significantly on the determination of this appeal. Claims 20 and 21 are dependent on claims 14-19, but only claim 20 was found to have been infringed by Doric's products24. While the primary judge determined that claims 20 and 21 were not obvious25, the Full Court ordered they both be revoked for lack of inventive step. Claim 20 describes the relationship between the detent and the actuator member, and their engagement when in the locking position. According to Lockwood, the validity of claim 30 in respect of an inventive step rises or falls with claim 13: claim 30 refers to a latch assembly according to claims 13-29 in which the "cam axis is substantially coincident with [the] actuator member axis". Like claims 1-6, claims 31 and 32 have been found to be invalid for lack of novelty. Claim 33 is an omnibus claim, which was determined not to be infringed, and which incorporates 11 detailed mechanical figures which illustrate the constituent components, assembly, and operation of latch assemblies within the Patent. In this appeal, Lockwood seeks an injunction restraining infringement of claims 13-15, 20 and 3026. The significant feature of claims 13-15, 20 and 30 is that they describe particular mechanical components of the lock and the relationships between those components which effect the deactivation of the internal handle lock via the outside actuator. 22 (2001) 192 ALR 306 at 326 [98], [103], 327 [105]; upheld by the Full Court: (2005) 226 ALR 70 at 82 [74], [75]. 23 (2001) 192 ALR 306 at 325 [93], 326 [99], 327 [106]. 24 (2001) 192 ALR 306 at 326 [100]-[101]. 25 (2001) 192 ALR 306 at 343 [212]. 26 Infringement was not alleged in respect of claim 21: (2001) 192 ALR 306 at 326 Callinan Crennan In its notice of appeal to this Court, Lockwood asserted that the Full Court erred in concluding that claims 1-6, 12-15, 20, 21 and 30-32 lacked an inventive step. In support of this, Lockwood argued that the Full Court erred in finding claim 1 and dependent claims obvious on the basis of an "implicit 'corollary' admission" said to have been made in the specification of the Patent and without evidence to support such a finding. As described in greater detail below, Lockwood did not distinguish between the broader claims and the narrower claims for the purposes of this argument. It was also contended that the Full Court erred in applying s 7(3) when assessing inventive step under s 18(1)(b)(ii) of the Act, in particular by including storeroom locks as relevant within the meaning of s 7(3). The question of whether the invention involves an inventive step when compared with the prior art base was restricted by Lockwood, during the course of argument, to the question of whether claim 13 involves an inventive step when compared with the prior art base. Claims 14 and 15, 20, 21 and 30 would rise or fall with claim 13. Section 7(3) of the Act operates differently in relation to the broader claim 1 and the narrower claim 13. On the evidence, different results are reached on the questions of whether the invention disclosed in each of the combinations in these two claims would have been obvious to a person skilled in the relevant art. The narrow claim is not obvious and so is valid. In the reasons which follow it is not necessary to determine that the broad claim 1 of the Patent is invalid for lack of inventive step as well as for want of novelty. However, that conclusion is apparent from the determination that the narrower claim 13 involves an inventive step, over a prior art base which does not include all of the art to be considered when determining whether claim 1 involves an inventive step. Before dealing with the specific operation of s 7(3) of the Act, it is necessary to describe in detail the Patent and its claims and the development of the requirement for a patent to involve an inventive step over prior art. It will then be necessary to examine the reasons of the courts below on the issue of obviousness and the particular evidence received in relation to the claims of the Patent. The legislative scheme Doric's claim of invalidity relies on s 138 of the Act. A person can apply to "a prescribed court", which includes the Federal Court of Australia, for an order revoking a patent. The ground upon which Doric relies in this case is set out in s 138(3)(b) – that the invention was not "a patentable invention". Callinan Crennan Under s 18(1) of the Act, as applicable at the relevant time27, "a patentable invention is an invention that, so far as claimed in any claim": is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies; and (b) when compared with the prior art base as it existed before the priority date of that claim: (i) is novel; and (ii) involves an inventive step". The applicable sub-sections of s 7 of the Act, as in force at the relevant time, provided: "(2) For the purposes of this Act, an invention is to be taken to involve an inventive step when compared with the prior art base unless the invention would have been obvious to a person skilled in the relevant art in the light of the common general knowledge as it existed in the patent area before the priority date of the relevant claim, whether that knowledge is considered separately or together with either of the kinds of information mentioned in subsection (3), each of which must be considered separately. For the purposes of subsection (2), the kinds of information are: prior art information made publicly available in a single document or through doing a single act; and prior art information made publicly available in 2 or more related documents, or through doing 2 or more related acts, if the relationship between the documents or acts is such that a person skilled in the relevant art in the patent area would treat them as a single source of that information; being information that the skilled person mentioned in subsection (2) could, before the priority date of the relevant claim, be 27 Reprint 2. Callinan Crennan reasonably expected to have ascertained, understood and regarded as relevant to work in the relevant art in the patent area."28 At the time relevant to this case, "prior art base" was defined in Sched 1 to the Act to mean: information in a document, being a document publicly available anywhere in the patent area; and information made publicly available through doing an act anywhere in the patent area."29 The person skilled in the relevant art in this case is a lock designer. Under the provisions the question of whether an invention does not involve an inventive step on grounds of obviousness, is decided objectively by the application of a statutory test employing the standard of "a person skilled in the relevant art". "Prior art information" is also determined objectively by the application of a statutory test involving the same standard. The question Claim 1 has been the subject of an order for revocation for want of novelty by the primary judge. The question to be resolved in this appeal is whether, when compared with the prior art base as at the priority date of 14 February 1996, the invention which is the subject matter of claim 13 (and dependent 28 These sub-sections have since been amended by the Patents Amendment (Innovation Patents) Act 2000 (Cth), which incorporated sections regarding innovation patents, and the Patents Amendment Act 2001 (Cth), which removed and substituted terms from s 7(2) and repealed and replaced s 7(3). 29 This definition has been amended by the Patents Amendment Act 2001 (Cth), such that "prior art base" now means: "(a) in relation to deciding whether an invention does or does not involve an inventive step or an innovative step: information in a document, that is publicly available, whether in or out of the patent area; and information made publicly available through doing an act, whether in or out of the patent area." Callinan Crennan claims 14, 15, 20, 21 and 3030) of the Patent involves an inventive step as required by s 18(1)(b)(ii) of the Act. That calls for determination of whether the invention claimed was obvious, and did not involve an inventive step, having regard to common general knowledge, whether considered separately or considered together with the kind of prior art information described in s 7(3). The inventive step in the Patent Both Lockwood and Doric characterised the inventive step as the adding of integer (vi), "lock release means which is responsive to said operation of the second actuator so as to thereby render said locking means inactive", to a known product, the Lockwood 001, which contained integers (i)-(v). It seemed to be accepted by Lockwood that the inventive step was the same for the broad claim, claim 1, as it was for the narrower claim, claim 13, the claim at the centre of this appeal, which included integers (vii) and (viii) set out in claim 12 as well as integers (ix) and (x). Lockwood did not identify a separate inventive step by reference to the combination of integers in claim 13, while it sought to reserve its rights in respect of the broader claim, claim 131. At the outset of the appeal there was no suggestion in argument that claim 13 and claims dependent on it could or should be severed from the main claim, claim 132. That may be explained, at least in part, by the statement in the Full Court that the two extra integers of claim 13, integers (ix) and (x), "saved it from lack of novelty, but [they] are both part of common general knowledge."33 However, in supplementary written and oral submissions Lockwood accepted that when a court is considering whether a claim is obvious, a narrow claim in a specification may be treated differently from a broad claim. Doric did not disagree with that general proposition, as, for example, when a narrow claim defines the invention by use of more integers34, as can be observed in claim 7. 30 In this appeal Lockwood sought an injunction based on claims 13-15, 20 and 30 of the Patent and Doric sought the revocation of claims 13-15, 20, 21 and 30 of the Patent. Infringement was not alleged in respect of claim 21: (2001) 192 ALR 306 31 Brugger v Medic-Aid Ltd [1996] RPC 635 at 656 per Laddie J. 32 cf Raleigh Cycle Co Ltd v H Miller & Co Ltd (1949) 66 RPC 253. 33 (2005) 226 ALR 70 at 91 [111(e)]. 34 See s 40(2)(b) of the Act. Callinan Crennan The historical development of the requirement for an inventive step It is important to refer to some basic principles that were engaged in this matter. These are principles that have been stated or referred to in earlier decisions, particularly decisions of this Court. We do not intend, however, and are not to be taken as suggesting, any reinterpretation of what was decided in those cases. Nonetheless, the recognition and application of these basic principles is fundamental to a proper understanding of the issues that arose in the litigation between the parties. Lack of novelty as a ground for invalidating a patent had its origins in the United Kingdom through the Statute of Monopolies35 enacted in 1623, which provided for the grant of Letters Patent for the "sole working or making of any manner of new manufactures" to the "true and first inventor". Within this context, novelty embraced not only the issue of anticipation, but also the issue of whether a thing produced required "some exertion of mind that could properly be called invention"36. Obviousness, or lack of an inventive step, was not clearly recognised as a separate ground of invalidity until late in the 19th century when a contemporary writer stated that the ground of invalidity emerged "as a brake upon the too rapid progress of patents for analogous uses"37. This development continued early in the 20th century38. It became commonplace to note in the cases that, in addition to novelty, it is necessary to ask separately whether an invention is "ingenious"39, 35 21 Jac 1 c 3, s 6. 36 Tatham v Dania (1869) Griffin Pat Cas 213 at 214 per Willes J. See also Morgan & Co v Windover & Co (1890) 7 RPC 131 at 134 per Lord Halsbury LC. 37 Edmunds, The Law and Practice of Letters Patent for Inventions, 2nd ed (1897) at 38 Blanco White, Patents for Inventions and the Protection of Industrial Designs, 5th ed (1983) at 55. 39 Cunynghame, English Patent Practice, (1894) at 77; Roberts, The Grant and Validity of British Patents for Inventions, (1903) at 37. See also Britain v Hirsch (1888) 5 RPC 226 at 232 per Cotton LJ: there must be "sufficient invention to justify a monopoly"; Cole v Saqui (1888) 6 RPC 41 at 44 per Lindley LJ: there must be some "ingenuity in that which is new"; and The Edison Bell Phonograph (Footnote continues on next page) Callinan Crennan or to recognise as Lockhart J said much more recently in R D Werner & Co Inc v Bailey Aluminium Products Pty Ltd40 ("R D Werner"): "Invention means more than novelty. Novelty alone will not sustain a patent." The historical development of the distinction between novelty and obviousness, identified by Windeyer J in Sunbeam Corporation v Morphy- Richards (Aust) Pty Ltd41, is explained by Aickin J in Minnesota Mining and Manufacturing Co v Beiersdorf (Australia) Ltd42 ("Minnesota Mining"). That explanation is amplified by Lockhart J and Gummow J in R D Werner43 and reiterated in this Court in Aktiebolaget Hässle v Alphapharm Pty Limited44 ("Alphapharm"). Briefly, the first Australian patent legislation, the Patents Act 1903 (Cth), imported into Australian law the principles in place in the United Kingdom. "Invention" was defined to mean "any manner of new manufacture the subject of letters patent and grant of privilege within section six of the Statute of Monopolies"45. Consonant with the cognate United Kingdom legislation, revocation by scire facias – essentially a writ to show cause – could be ordered upon a person's petition to the relevant court on the basis of any ground which would have been available at common law46. Corporation Limited v Smith (1894) 11 RPC 389 at 398 per Lord Esher MR: it must not be "so easy that any fool could do it". 40 (1989) 25 FCR 565 at 574. 41 (1961) 180 CLR 98 at 111-112. 42 (1980) 144 CLR 253 at 289-291. 43 (1989) 25 FCR 565 at 573-575, 594-601 respectively. 44 (2002) 212 CLR 411 at 422-423 [19]-[20] per Gleeson CJ, Gaudron, Gummow and 45 Patents Act 1903 (Cth), s 4. 46 Patents Act 1903 (Cth), s 86(3). See also, for example, the Patents, Designs, and Trade Marks Act 1883 (UK) 46 & 47 Vict c 57, s 26. Following changes made in (Footnote continues on next page) Callinan Crennan The Patents and Designs Act 1932 (UK) introduced a consolidated list of grounds for the revocation of a patent47. One of the grounds provided that a patent could be revoked if the invention was not new48; but a further ground of revocation could be invoked if the invention "is obvious and does not involve any inventive step having regard to what was known or used prior to the date of the patent"49. That constituted a different formulation of the old ground of "want of subject matter" with the test becoming an overtly qualitatively test rather than a quantitative one. Although the Knowles Committee was established in 1935 to consider changes to Australian patent law in the light of these developments in the United Kingdom, it was not until the recommendation of the Dean Committee in 195250 that the Patents Act 1952 (Cth) ("the 1952 Act") was passed. That legislation implemented similar changes in Australia, including a consolidated list of grounds for revocation. This legislation contained s 100(1)(e), which provided for revocation if a claim "was obvious and did not involve an inventive step, having regard to what was known or used in Australia on or before the priority date of that claim" (emphasis added). This was the first legislative recognition in Australia that obviousness, or lack of inventive step, constituted a ground of revocation which was independent of lack of novelty, despite the fact that such a distinction had been made in legislation in the United Kingdom nearly 20 years earlier. The Act which the Patents and Designs Act 1907 (UK), the Patents Act 1909 (Cth) was passed in Australia. 47 Section 3 inserted a new s 25(2) into the Patents and Designs Act 1907 (UK). 48 Section 25(2)(e). 49 Section 25(2)(f). This ground was later amended by the Patents and Designs Act 1949 (UK): s 14(1) inserted a new s 25 into the Patents and Designs Act 1907 (UK), including s 25(1)(f), such that a patent could be revoked if "the invention … is obvious and does not involve any inventive step having regard to what was known or used, before the priority date of the claim, in the United Kingdom". 50 The report of the Knowles Committee was contained in the report of the later Dean Committee: Report of the Committee Appointed by the Attorney-General of the Commonwealth to Consider what Alterations are Desirable in The Patent Law of the Commonwealth, 1952. Callinan Crennan governs the Patent here commenced on 30 April 1991, and introduced ss 7 and 18. Now the current requirements for an inventive step differ from those to be found in s 100(1)(e) of the 1952 Act, as explicated in Minnesota Mining51. In 1991 the legislature raised the threshold of inventiveness, compared with the 1952 Act, by requiring consideration not only of what was "known or used" but also of additional information which was publicly available. These provisions will be considered in more detail later in these reasons. Although Alphapharm was decided in relation to a patent registered under the 1952 Act, what was said in the reasons of the majority in that case about the historical development of the law in relation to obviousness and the requirement for an inventive step is relevant and applicable to the current law of obviousness in Australia52. Particular note may be made of the warning in Alphapharm against the misuse of hindsight in relation to patents which are a new and inventive combination of known integers53. In Alphapharm, the majority of this Court drew attention to the divergence between the Australian and the United Kingdom patent systems54 and of the "shift in grundnorm"55 concerning inventiveness which has occurred in the United Kingdom, following the Convention on the Grant of European Patents in 1973 and the subsequent enactment of the Patents Act 1977 (UK)56. 51 (1980) 144 CLR 253 at 287ff per Aickin J. 52 (2002) 212 CLR 411 at 427 [33]ff. 53 (2002) 212 CLR 411 at 423-424 [21], with reference to Technograph Printed Circuits Ltd v Mills & Rockley (Electronics) Ltd [1972] RPC 346 at 362 per Lord Diplock, and also Olin Corporation v Super Cartridge Co Pty Ltd (1977) 180 CLR 236 at 262 per Stephen and Mason JJ. See also Minnesota Mining (1980) 144 CLR 253 at 293 per Aickin J. 54 (2002) 212 CLR 411 at 429 [42]ff. 55 (2002) 212 CLR 411 at 432 [49]. 56 Pumfrey J in Glaxo Group Ltd's Patent [2004] RPC 43 has responded to those passages in Alphapharm thus (at 858 [41]): "Both the Scylla of considering nothing obvious except that to which the skilled man is driven and the Charybdis of considering every invention obvious that can be decomposed into a sequence of obvious steps must be avoided. The former is (Footnote continues on next page) Callinan Crennan A similar development in relation to obviousness took place in the United States. The patent regime there originated from the English system; however, since the passing of the first patent statute in 179057, a number of divergences have occurred. The most recent codification is the Patent Act 1952 (US)58. Although primarily restating the law as it stood up to that point in time, it also introduced the concept of "non-obviousness" as a legislative requirement for patentability in § 103. This took place in circumstances where obviousness had been recognised and applied in courts as early as 185059. The emergence of the independent requirement for an inventive step, first in case law, then in legislative requirements for patentability as occurred in the United Kingdom, the United States and Australia, has always reflected the balance of policy considerations in patent law of encouraging and rewarding inventors without impeding advances and improvements by skilled, non- unfair to industry because it stifles natural development. The latter is unfair to inventors and not countenanced by English patent law". 57 Patent Act 1790 (US) 1 Stat 109. 58 35 USC. 59 Hotchkiss v Greenwood 52 US 248 at 266 (1850), in which it was determined that while the claimed invention was "new" in that it had not been made using its particular constituent materials before, it was "destitute of ingenuity or invention". See also Graham v John Deere Co of Kansas City 383 US 1 at 17-18 (1966), where the Supreme Court addressed four considerations under the rubric of non- obviousness: the extent of the prior art; the degree of difference between the prior art and the claimed invention; the level of skill of the ordinary worker in the industry; and evidence of secondary considerations such as a long felt want in the industry, or commercial success. The continuing authority of John Deere was affirmed by the Supreme Court in KSR International Co v Teleflex Inc (30 April 2007); the Court also disapproved recent Federal Circuit decisions that a combination claim is obvious only if the prior art, the nature of the problem to be solved or the knowledge of the ordinary skilled worker in the art, reveals "some teaching, suggestion, or motivation" to combine known elements of the prior art. See also Moy's Walker on Patents, 4th ed (2006), vol 3, ch 9; Federico, "Commentary on the New Patent Act", (1993) 75 Journal of the Patent and Trademark Office Society 161 at 180-183; and Federico, "Origins of Section 103", (1977) 5 American Patent Law Association Quarterly Journal 87. Callinan Crennan inventive persons60. The terms of ss 7(2), 7(3) and 18(1)(b)(ii) of the Act, and the different but cognate sections in the Patents Act 1977 (UK), reflect the intention of both legislatures to "rebalance" those policy considerations, by raising the threshold of inventiveness. Previously, only common general knowledge was taken into account when assessing an inventive step. Now, additional information which was publicly available as at the priority date must also be taken into account. Broadly speaking, s 7(3) has as its purpose the specification of the additional publicly available information ("s 7(3) information") which must be added to common general knowledge for the purposes of deciding whether an alleged invention is obvious when compared with the prior art base. General principles concerning inventive step Although the threshold of inventiveness has been raised as explained by the legislative changes referred to above, case law developed previously continues to be relevant, not least because the legislation employs many familiar terms, such as "common general knowledge". That makes it necessary to briefly refer to general principles of continuing relevance before turning to consider the legislative provisions in more detail. In Alphapharm, this Court reiterated that "obvious" means "very plain"61, as stated by the English Court of Appeal in General Tire & Rubber Co v Firestone Tyre and Rubber Co Ltd62. The majority in Alphapharm also confirmed that the question of whether an invention is obvious is a question of fact, that is, it is what was once a "jury question"63. Broadly speaking, the question is not a question of what is obvious to a court64. As well as being a 60 Société Technique de Pulverisation Step v Emson Europe Ltd [1993] RPC 513 at 519 per Hoffmann LJ. 61 (2002) 212 CLR 411 at 427 [34] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, 444 [85] per McHugh J, 463 [144] per Kirby J, 477 [190] per Callinan J. 62 [1972] RPC 457 at 497. 63 (2002) 212 CLR 411 at 443 [79]. 64 Technograph Printed Circuits Ltd v Mills & Rockley (Electronics) Ltd [1972] RPC 346 at 355 per Lord Reid. Callinan Crennan question of fact, the question of determining whether a patent involves an inventive step is also "one of degree and often it is by no means easy"65, because ingenuity is relative, depending as it does on relevant states of common general knowledge. This difficulty is further complicated now by the need, in some circumstances, to consider s 7(3) information as well as common general knowledge. recognised Further, as in Beecham Group Ltd's (Amoxycillin) Application66, as a basic premise, obviousness and inventiveness are antitheses and the question is always "is the step taken over the prior art an 'obvious step' or 'an inventive step'"? An inventive step is often an issue "borne out by the evidence of the experts"67. There is no distinction between obviousness and a lack of inventive step68. A "scintilla of invention"69 remains sufficient in Australian law to support the validity of a patent70. In R D Werner Lockhart J 65 See John McIlwraith Industries Ltd v Phillips (1958) 98 CLR 529 at 536 per Dixon CJ; Alphapharm (2002) 212 CLR 411 at 427 [33] citing Société Technique de Pulverisation Step v Emson Europe Ltd [1993] RPC 513 at 519 per Hoffmann LJ. 66 [1980] RPC 261 at 290 per Buckley LJ, as referred to in the majority reasons of this Court in Alphapharm (2002) 212 CLR 411 at 423 [20]; cf Genentech Inc's Patent [1989] RPC 147 at 274 per Mustill LJ. 67 Raleigh Cycle Co Ltd v H Miller & Co Ltd (1946) 63 RPC 113 at 136 per Lord Greene MR. 68 Benmax v Austin Motor Co Ltd (1953) 70 RPC 284 at 288 per Evershed MR. 69 Woolworths Ltd v W B Davis and Son Ltd Inc (1942) 16 ALJ 57 at 59 per 70 Alphapharm (2002) 212 CLR 411 at 431 [48], referring to HPM Industries Pty Ltd v Gerard Industries Ltd (1957) 98 CLR 424 at 436 per Williams J. See also Meyers Taylor Pty Ltd v Vicarr Industries Ltd (1977) 137 CLR 228 at 249 per Aickin J. It was also noted in Alphapharm that the present position in the United Kingdom may require something more than a "scintilla of invention", which was once sufficient. See, for example, Thomson v The American Braided Wire Company (1889) 6 RPC 518 at 527-528 per Lord Herschell; for a more recent example, see Cleveland Graphite Bronze Coy v Glacier Metal Coy Ld (1950) 67 RPC 149 at 156 per Lord Normand. Callinan Crennan stated that there must be "some difficulty overcome, some barrier crossed"71. This is consonant with older authorities in the United Kingdom which recognised that some inventiveness was required72 to distinguish patentable advances over the prior art from advances which "any fool"73 could devise. It also accords with the requirement in the United States that for an invention to be "non-obvious"74 it must be "beyond the skill of the calling"75. The essential question to be posed when considering obviousness under the 1952 Act was outlined by Aickin J in Wellcome Foundation Ltd v VR Laboratories (Aust) Pty Ltd76 ("Wellcome Foundation"). Section 101(1) of the 1952 Act set out the grounds upon which a patent might be revoked. Section 101(1)(e) relevantly provided: "that the invention, so far as claimed in any claim, was obvious and did not involve an inventive step, having regard to what was known or used in Australia on or before the priority date of that claim." (emphasis added) In considering whether experiments by an inventor were relevant to the issue of obviousness, in Wellcome Foundation, Aickin J77 stated: 71 (1989) 25 FCR 565 at 574; see also Allsop Inc v Bintang Ltd (1989) 15 IPR 686 at 701 per Bowen CJ, Beaumont and Burchett JJ; Elconnex Pty Ltd v Gerard Industries Pty Ltd (1992) 25 IPR 173 at 182 per Lockhart J. 72 Vickers, Sons & Co v Siddell (1890) 15 App Cas 496 at 501-502 per Lord Herschell. 73 The Edison Bell Phonograph Corporation Limited v Smith (1894) 11 RPC 389 at 398 per Lord Esher MR. 74 Patents Act 1952 (US), § 103. 75 Graham v John Deere Co of Kansas City 383 US 1 at 15 (1966), as referred to in Allsop Inc v Bintang Ltd (1989) 15 IPR 686 at 701 per Bowen CJ, Beaumont and Burchett JJ, and Leonardis v Sartas No 1 Pty Ltd (1996) 67 FCR 126 at 146 per Burchett, Hill and Tamberlin JJ. 76 (1981) 148 CLR 262. 77 (1981) 148 CLR 262 at 270, with whom Gibbs, Stephen, Mason and Wilson JJ agreed. Callinan Crennan "It is as well to bear in mind that the question of obviousness involves asking the question whether the invention would have been obvious to a non-inventive worker in the field, equipped with the common general knowledge in that particular field as at the priority date, without regard to documents in existence but not part of such common general knowledge." (emphasis added) "Common general knowledge" was well understood as being "part of the mental equipment of those concerned in the art under consideration"78, and Minnesota Mining had confirmed that what was "known or used" in Australia was confined to common general knowledge, which was explained as79: "the background knowledge and experience which is available to all in the trade in considering the making of new products, or the making of improvements in old". The effect of Minnesota Mining and Wellcome Foundation was that for the purpose of determining inventiveness prior disclosures which were publicly available information, but which were not part of common general knowledge, were excluded from consideration. In the case of Minnesota Mining, a number of prior specifications available for public inspection in Australia before the priority date which were not part of common general knowledge were excluded from consideration. Whether a patent is obvious under the Act is still to be determined by reference to the hypothetical non-inventive worker in the field (now a "person skilled in the relevant art" (ss 7(2) and 7(3)) equipped with common general knowledge, as stated by Aickin J in Minnesota Mining and followed since80. Therefore it is irrelevant whether the invention was arrived at as a matter of chance or luck or the result of long experiment or great intellectual effort81. 78 Lektophone Corporation v S G Brown Ltd (1929) 46 RPC 203 at 225. 79 (1980) 144 CLR 253 at 292 per Aickin J. 80 Alphapharm (2002) 212 CLR 411; Firebelt Pty Ltd v Brambles Australia Ltd (2002) 76 ALJR 816; 188 ALR 280; see also, for example, Elconnex Pty Ltd v Gerard Industries Pty Ltd (1992) 25 IPR 173; Allsop Inc v Bintang Ltd (1989) 15 IPR 686. 81 Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd (1998) 194 CLR 171 at 187 [25] per Brennan CJ, Gaudron, McHugh and Gummow JJ; (Footnote continues on next page) Callinan Crennan However, reference to and use of prior disclosures, in existence but not part of the common general knowledge, has now been extended. This has the result that the limitation in Aickin J's statement of principle, emphasised above, no longer applies, a topic about which more will be said later. The objective approach to determining obviousness is equally applicable to a combination patent82. As to the position in the United Kingdom, in Technograph Printed Circuits Ltd v Mills & Rockley (Electronics) Ltd83, Lord Reid construed the phrase "having regard to what was known or used, before the priority date"84 as meaning "what was or ought to have been known to a diligent searcher"85. Lord Diplock went further than that and accepted that the words meant everything in the public domain, which in that case included patent specifications in the United Kingdom, as well as foreign ones which were available in the Lord Reid's construction was preferred and approved in General Tire & Rubber Co v Firestone Tyre and Rubber Co Ltd87, but s 2(2) of the Patents Act 1977 (UK) now provides that the "state of the art" for the purposes of determining obviousness includes everything in the public domain: Wellcome Foundation (1981) 148 CLR 262 at 279 per Aickin J, citing Dow Corning Corporation's Application [1969] RPC 544 at 560 per Graham J; see also Flexible Steel Lacing Company v Beltreco Ltd (2000) 49 IPR 331 at 367 [166] per Hely J; and Crane v Price (1842) 4 Man & G 580 at 605 [134 ER 239 at 249] per Tindal CJ delivering the judgment of the Court. 82 Alphapharm (2002) 212 CLR 411 at 429 [41]; Minnesota Mining (1980) 144 CLR 253 at 293 per Aickin J. 83 [1972] RPC 346. 84 Section 32(1)(f) of the Patents Act 1949 (UK) (emphasis added), which was cognate with s 100(1)(e) of the 1952 Act. 85 [1972] RPC 346 at 355. 86 [1972] RPC 346 at 361. 87 [1972] RPC 457 at 497. Callinan Crennan "all matter (whether a product, a process, information about either, or anything else) which has at any time before the priority date of the invention been made available to the public (whether in the United Kingdom or elsewhere) by written or oral description, by use or in any other way." Patentability of ideas For the purposes of considering this Patent and its treatment in the Courts below, it is instructive to start with an old but frequently repeated description of the processes of invention by Fletcher Moulton88: "An invention may, and usually does, involve three processes. Firstly, the definition of the problem to be solved or the difficulties to be overcome; secondly, the choice of the general principle to be applied in solving this problem or overcoming these difficulties; and thirdly, the choice of the particular means used. Merit in any one of these stages, or in the whole combined, may support the invention"89. Distinctions between the idea or concept or principle informing an invention and the means of carrying it out or embodying it in a manner of new manufacture have long been made despite certain expressions of caution from time to time90. In Hickton's Patent Syndicate v Patents and Machine Improvements Company Ltd91, Fletcher Moulton LJ stated that "invention may lie in the idea, and it may lie in the way in which it is carried out, and it may lie in the combination of the two"92. 88 Fletcher Moulton, The Present Law and Practice Relating to Letters Patent for Inventions, (1913) at 24 (footnotes omitted). 89 See also Australian Patent Office, Patent Office Notes on the History of the British and Commonwealth Patent Acts and the Law Relating to Letters Patent of Inventions in Australia, 5th ed (1974) at 23-24. 90 See, for example, Blanco White, Patents for Inventions and the Protection of Industrial Designs, 5th ed (1983) at 95-96. 91 (1909) 26 RPC 339. 92 (1909) 26 RPC 339 at 348. Callinan Crennan In a sense, an idea simpliciter cannot be patented, as no patent will be granted except to a manner of manufacture within s 6 of the Statute of Monopolies. An idea which is part, even the main part, of an inventive step "has got to end in a new method of manufacture"93. When an idea is incorporated into a means for carrying out an idea, the idea itself can be taken into account when considering validity, and inventiveness may repose largely in the idea. As a matter of language, it is almost inevitable that the subject matter of an invention which involves an improvement to a known combination will be spoken of as "an idea" or "a concept", as occurred here, and invention may lie in "the idea of taking the step in question"94. To the extent that such language is used, an inventive step can be "having an insight which, although simple, genuinely requires an act of insight rather than a mere development and application of existing ideas"95. In dealing with a question of obviousness under the Patents Act 1949 (UK) in Windsurfing International Inc v Tabur Marine (Great Britain) Ltd96 Oliver LJ isolated the "inventive concept" when he set out a four-step process to be taken when approaching the question of obviousness97: "The first [step] is to identify the inventive concept embodied in the patent in suit. Thereafter, the court has to assume the mantle of the normally skilled but unimaginative addressee in the art at the priority date and to impute to him what was, at that date, common general knowledge in the art in question. The third step is to identify what, if any, differences exist between the matter cited as being 'known or used' and the alleged invention. Finally, the court has to ask itself whether, viewed without any knowledge of the alleged invention, those differences constitute steps 93 In re IG Farbenindustrie AG's Patents (1930) 47 RPC 289 at 309 per Maugham J (in argument). 94 Olin Mathieson Chemical Corporation v Biorex Laboratories Ltd [1970] RPC 157 at 192 per Graham J; see generally Terrell on the Law of Patents, 16th ed (2006) at 95 Molnlycke AB v Procter & Gamble Ltd (No 5) [1994] RPC 49 at 132 per Nicholls VC, delivering the judgment of the Court. 96 [1985] RPC 59. 97 [1985] RPC 59 at 73-74. Callinan Crennan which would have been obvious to the skilled man or whether they require any degree of invention." (emphasis added) The "inventive concept" is important for what has come to be regarded in the United Kingdom as a "structured"98 approach to determining obviousness under the current statutory definition99. In Biogen Inc v Medeva plc100 Lord Hoffmann said: "A proper statement of the inventive concept needs to include some express or implied reference to the problem which it required invention to overcome." (emphasis added) As noted in Alphapharm101, that statement may reflect the "problem and solution" approach apparently mandated by the European Patent Convention. That "problem and solution" approach has the inevitable effect that an idea which constitutes an addition to the existing stock of knowledge needs to be specifically characterised as an idea of doing a new thing, or an idea of the way of achieving a previously known goal, or the idea of a particular solution in relation to achieving a certain goal102. 98 Molnlycke AB v Procter & Gamble Ltd (No 5) [1994] RPC 49 at 115 per Nicholls VC, delivering the judgment of the Court. 99 By s 1(1)(b) of the Patent Act 1977 (UK), a patent may only be granted for an invention if it involves an "inventive step", and s 3 provides: "An invention shall be taken to involve an inventive step if it is not obvious to a person skilled in the art, having regard to any matter which forms part of the state of the art by virtue only of section 2(2) above (and disregarding section 2(3) above)". Section 130(7) provides that various provisions including ss 2 and 3 are framed so as to have the same effects as corresponding provisions of the European Patent Convention, the Community Patent Convention and the Patent Co-operation Treaty. 100 [1997] RPC 1 at 45. 101 (2002) 212 CLR 411 at 429 [40]. 102 Biogen Inc v Medeva plc [1997] RPC 1 at 34 per Lord Hoffmann. Callinan Crennan Although the recognition of the need to identify an "inventive idea" justifying a monopoly is not new in Australia103, the developments in the United Kingdom, which emphasise the need to identify the "inventive concept" in terms of "problem and solution", have raised the threshold of inventiveness. This has been exemplified by a number of relevant English cases since 1977104. Such developments were considered and distinguished in Alphapharm105. This Court rejected confining the question of obviousness to a "problem and solution" approach, particularly with a combination patent. This should not be misconstrued. The "problem and solution" approach106 may overcome the difficulties of an ex post facto analysis of an invention, which may be unhelpful in resolving the question of obviousness107. However, it is worth repeating that the "problem and solution" approach may be particularly unfair to an inventor of a combination, or to an inventor of a simple solution108, especially as a small amount of ingenuity can sustain a patent in Australia. Ingenuity may lie in an idea for overcoming a practical difficulty in circumstances where a difficulty with a product consisting of a known set of integers is common general knowledge109. This is a narrow but critical point if, as here, the circumstances are that no skilled person in the art called to give evidence had thought of a general idea or general method of solving a known difficulty with respect to a known product, as at the priority date. When considering the patentability of ideas it is necessary to remember that a "manner of manufacture" requires "something of a corporeal and 103 Commissioner of Patents v Microcell Ltd (1959) 102 CLR 232 at 249 per Dixon CJ, McTiernan, Fullagar, Taylor and Windeyer JJ. 104 See for example, Haberman v Jackel International Ltd [1999] FSR 683 at 706 [45] per Laddie J; Glaxo Group Ltd's Patent [2004] RPC 43. 105 (2002) 212 CLR 411 at 428-429 [38]-[40]. 106 HPM Industries Pty Ltd v Gerard Industries Ltd (1957) 98 CLR 424 at 437 per 107 Meyers Taylor Pty Ltd v Vicarr Industries Ltd (1977) 137 CLR 228. 108 Haberman v Jackel International Ltd [1999] FSR 683 at 698 [29] per Laddie J. 109 Molnlycke AB v Procter & Gamble Ltd (No 5) [1994] RPC 49. Callinan Crennan substantial nature"110. The expansion of "a manner of new manufacture" through case law which has been "characteristic of the growth of patent law"111 came to rest with the acknowledgment in National Research Development Corporation v Commissioner of Patents ("the NRDC case")112 that any attempt to fetter the exact meaning of "a manner of new manufacture" could never be sound113. Obviousness and claim 1 The question of obviousness and claim 1 was central to the way this case was put before the primary judge and the Full Court. Whilst no rights are reserved now by Lockwood in respect of applying in the future to amend claim 1 (which was ordered to be revoked by the primary judge for lack of novelty), it would be difficult to appreciate the findings below and to understand the changing contours of the defence to the case for revocation without starting with a consideration of that claim. It was contended consistently by Doric that the inventive step for claim 1 was the same as the inventive step for claim 13, namely adding integer (vi) to a known product. By the conclusion of the hearing, Lockwood contended that the s 7(3) information relevant to determining whether claim 13 involves an inventive step was more limited than the s 7(3) information relevant to determining whether claim 1 involves an inventive step. This inevitably carries with it the recognition that the inventive step for claim 13 is determined by reference to the combination of integers to be found in claim 13, which is a different combination of integers from that to be found in claim 1. Claim 1 encompasses a corporeal subject matter, namely a lock with the features of the Lockwood 001 with the added feature of a lock release means responsive to an outside actuator such as a key. It is explained in the specification that the Lockwood 001 gave rise to the patentee's development of the invention. As stated by this Court earlier114, the invention here does not claim 110 R v Wheeler (1819) 2 B & Ald 345 at 350 [106 ER 392 at 395] per Abbott CJ. 111 Maeder v Busch (1938) 59 CLR 684 at 706 per Dixon J. 112 (1959) 102 CLR 252. 113 (1959) 102 CLR 252 at 271 per Dixon CJ, Kitto and Windeyer JJ. 114 (2004) 217 CLR 274 at 304 [78]. Callinan Crennan a monopoly in any individual integer: it is a combination of integers including integer (vi). It is not permissible to treat integer (vi) in isolation, since inventiveness has to be determined by considering the combination as a whole115, just as the novelty of a combination has long been judged on the whole combination116. The particular point here was whether the combination in claim 1 was obvious because it was obvious to add integer (vi) (which was a known integer, but not common general knowledge), to integers (i)-(v) (which were part of common general knowledge). Integer (v) had a well-understood function of withdrawing the latch bolt before integer (vi) was added. After integer (vi) was added, integer (v) had two functions, both to withdraw the latch bolt and deactivate the inside handle lock, and the combination as a whole involved a synergy117 between integers (iv), (v) and (vi) which did not exist previously in locks, within common general knowledge. Doric sought to characterise the claim as one where it was obvious to combine the integers118 and the key was an obvious mechanism to achieve an obvious advantage119. What was not in dispute is that the prior known product, the Lockwood 001, which contained integers (i)-(v), and which was discussed in the body of the specification, was part of the common general knowledge. Nor was it disputed that it was clear to anyone operating a Lockwood 001 that operation of the outside activator (the key) did not release the inside handle lock. The primary judge also noted that integer (vi) of claim 1 was to be found in certain 115 Alphapharm (2002) 212 CLR 411 at 419 [6]; Minnesota Mining (1980) 144 CLR 116 May v Higgins (1916) 21 CLR 119 at 121-122 per Griffith CJ. 117 A notion referred to in Lucas v Peterson Portable Sawing Systems Ltd [2006] 3 NZLR 721. 118 For a recent example, see Sabaf SpA v MFI Furniture Centres Ltd [2005] RPC 10. 119 Adelmann and Ham Boiler Corporation v Llanrwst Foundry Company (1928) 45 RPC 413; Acme Bedstead Co Ltd v Newlands Brothers Ltd (1937) 58 CLR 689; Winner v Ammar Holdings Pty Ltd (1992) 24 IPR 137; Winner v Ammar Holdings Pty Ltd (1993) 41 FCR 205. Callinan Crennan storeroom locks, a Lockwood lock known as the Lockwood 530, a lock known as the Boyd mortice lock and in certain sliding door locks, but his Honour found these were not part of common general knowledge. Doric did not seek to disturb that finding on this appeal. Rather, Doric's response to that finding was to rely on s 7(3) of the Act, in order to characterise the individual sales of the storeroom locks as s 7(3) information relevant to the question of whether claim 1 involves an inventive step when compared with the prior art base. The proceedings before the primary judge Before examining the decision of the primary judge in detail, it is necessary to say something about the evidence of the witnesses at trial and the way in which the arguments concerning inventive step proceeded below. Witnesses At trial, the evidence of four people was of greatest significance to the inventive step issue: Mr Wilson, a locksmith, and Mr Freestone, a lock designer, both experts called by Lockwood; Mr Garland, an expert called by Doric; and Mr Alchin, the inventor of the Doric lock. Mr Blanch, the inventor of the lock the subject of the Patent, was not called to give evidence at trial, but certain documents relating to his endeavours were in evidence. The body of evidence was admitted, substantially although not wholly without objection, and was relevant to prior art, common general knowledge, the problem to be solved and the advance in the art represented by the invention. Mr Garland Mr Garland gave evidence that he had designed components for over 40 types of doors and locks for Doric and that he had been personally involved with both mortice locks and rim mounted locks. A rim mounted lock is a lock mounted to the surface of the door, as opposed to a lock which is installed or "morticed" into the centre of the door's edge. He was retained by Doric to design a product to compete with the Lockwood 001, and he understood it was a rim mounted deadlock. He was familiar with the known Lockwood 001 and observed "there is a problem of locking yourself in". Mr Garland was a person who prided himself on his inventive faculties, having been named as inventor or having been associated with various granted patents including patents for "lock type products". He purported to characterise the addition of integer (vi) to the Lockwood 001 as an "obvious solution"; but he did not come up with the solution in the Patent himself, in either claim 1 or claim 13, despite knowing of the storeroom locks and despite his interest as an inventor in research and Callinan Crennan development. Mr Garland agreed that if he had come up with the solution (despite not being briefed to do so by Doric) he would have passed the solution on to Doric. Mr Garland also gave evidence that there was more than a single solution to the problem of being "locked in". Finally, although Mr Garland gave evidence that a distinction between a mortice lock (a lock which was not rim mounted) and a rim mounted lock was only a question of the positioning of the locks, as well as evidence that he knew of the storeroom locks before the priority date of the Patent, he did not give evidence that he would have looked at storeroom locks if he had been asked to seek a solution to the problem of being locked in with the Lockwood 001. One of the recurring difficulties on the appeal was whether evidence such as that could embrace the concept of claim 1 as well as more specific examples of solutions as contained in claim 7 or claim 13. The primary judge rejected Mr Garland's evidence that a non-inventive skilled worker would have hit upon Lockwood's solution120. First, Mr Garland was an inventor, and secondly, Mr Garland did not come up with the solution, despite being aware of the "locked in" problem121. Mr Alchin Mr Alchin, the other relevant witness for Doric, was familiar with the known Lockwood 001, but gave evidence that he did not recognise that a problem with the product was its "lack of a safety release feature". He agreed "with the benefit of hindsight" that it was an advantage to add a "safety release feature" to the known Lockwood 001. He said that at the time of the release of the improved Lockwood products, produced in accordance with the Patent, he was not sure that the problem of "getting locked in" was a "big enough problem for this change [the addition of the safety release feature to the Lockwood 001] to have been an advantage" but he said: "I suspect in hindsight that it was". The primary judge found that Mr Alchin, Doric's lock designer, "did not set out to copy that product [ie, the new Lockwood 001 with safety release feature] beyond taking the bare idea of the inclusion of a lock release means 120 (2001) 192 ALR 306 at 336 [169]. 121 (2001) 192 ALR 306 at 335-336 [166]. Callinan Crennan whereby the inside lock would be released by the operation of the outside actuator"122. Mr Wilson Mr Wilson was a locksmith rather than a lock designer. He had sold the Lockwood 001 product and gave evidence that when he was selling the product he always told purchasers "to ensure that when they come home that they unlock the inside as they come home so they don't find themselves in the house locked in". He regarded the Patent as directed to the problem of "people locking themselves in". The primary judge emphasised that Mr Wilson had said in cross- examination that he had never been asked to design any lock, whether or not containing feature (vi) of claim 1123. Mr Freestone Mr Freestone gave evidence that there was a problem posed by the dead latch of the Lockwood 001. He also gave evidence that the inventor's solution to the problem was "ingenious" but this was recognised, correctly, by the primary judge as evidence in respect of Lockwood's preferred embodiments rather than evidence of any inventive step involved in adding integer (vi) to integers (i)-(v) in the Lockwood 001. Putting to one side evidence of the ingenuity of the preferred embodiment, Mr Freestone, whose reference point was the Lockwood 001, gave evidence that the problem of "being locked in to residences" had been put in the "too hard basket". Because his reference point was a vendible product which involved some mechanics, this evidence must be taken to mean "too hard" from some practical or technical point of view. The primary judge accepted this evidence and found that Mr Freestone was a careful and reliable witness124. 122 (2001) 192 ALR 306 at 338 [179]. 123 (2001) 192 ALR 306 at 334 [159]. 124 (2001) 192 ALR 306 at 336 [169]. Callinan Crennan Arguments on common general knowledge before the primary judge Whilst it was recognised before the primary judge that each claim must be considered separately in order to determine whether it involved an inventive step, for the purposes of the argument Doric broke the claims down into two groups. The first group included claims 1-6, 12-15, 20, 21, and 30-32, which group was characterised as claims which include matters within common general knowledge in combination with integer (vi)125. The second group included claims 7-11, 16-19, 22-29, and 33. This group was characterised as "preferred embodiment" claims which include matters within common general knowledge in combination with integer (vi) and additional integers126. In accordance with s 7(2) of the Act, the primary judge first considered whether the claims were obvious by reference to common general knowledge considered alone. In his discussion of that issue, his Honour correctly acknowledged that it was a question of fact127, and observed that this was not a case in which the perception of the problem could be said to be inventive, because the problem was well-known. Any inventiveness, he said, would lie with the solution to the problem128. The primary judge also acknowledged that it would be a question of fact whether the invention described in claim 1 was "merely a product described by reference to a set of 'obviously desirable' parameters"129. This was a reference to the terms of a successful challenge, in respect of obviousness, in Re Raychem Corp's Patents130. The primary judge noted that the Lockwood 001 possessed integers (i)-(v) of claim 1 of the Patent and that the specification "admits that those features were part of the common general knowledge"131. However, in that context, the 125 (2001) 192 ALR 306 at 340-341 [196]-[197]. 126 (2001) 192 ALR 306 at 340 [196] and 343 [213]. 127 (2001) 192 ALR 306 at 342 [208]. 128 (2001) 192 ALR 306 at 341 [200]. 129 (2001) 192 ALR 306 at 342 [208]. 130 [1998] RPC 31. 131 (2001) 192 ALR 306 at 339 [186]. Callinan Crennan primary judge acknowledged that "[f]rom the perspective of the skilled worker, obviousness is or may be bound up with practical considerations"132. The primary judge stated133: "Guided by Re Raychem Corp's Patents and Winner v Ammar Holdings my initial impression was that the generality of the description of the invention in claim 1, and in particular feature (vi), was sufficient to lead to the conclusion that the alleged invention as claimed is obvious." The primary judge then considered two matters: the evidence of admissions in the specification; and the evidence of the witnesses. His Honour found there were two admissions in the specification: that key operation of the latch from the outside of the door did not release the inside handle lock; and that, as a result, people may be locked in134. In relation to the evidence of witnesses, the primary judge said135: "No witness deposes to the fact that it was understood at the priority date that a solution to the problem identified in the specification was to use the outside key to release the inside lock. It was not obvious to Mr Freestone or Mr Wilson. The fact that resolution of the problem was placed in the 'too hard' basket by Mr Freestone is inconsistent with obviousness. The evidence of Mr Wilson and Mr Freestone establishes that there was a perceived need to find a solution to the problem, but it had not occurred to Mr Alchin or Mr Garland until after the release of the new Lockwood 001 that the problem should be solved in a manner which, in Doric's submission, was obvious." 132 (2001) 192 ALR 306 at 343 [208]. The reference to "practical considerations" calls to mind the "Cripps question" set out in Sharp & Dohme Inc v Boots Pure Drug Company Ltd (1928) 45 RPC 153 at 173. 133 (2001) 192 ALR 306 at 342 [207]. 134 (2001) 192 ALR 306 at 341 [202]. 135 (2001) 192 ALR 306 at 343 [211]. Callinan Crennan His Honour then proceeded to find that claim 1 was not obvious by reference to common general knowledge alone. The primary judge then referred to ss 7(2) and 7(3) of the Act, and considered the evidence of the other types of locks referred to by Doric, but did not find that any of the locks could, before the priority date, reasonably be expected to have been ascertained, understood and regarded as relevant136 by a person skilled in the art. Further consideration of this aspect of his Honour's reasons will be necessary later. The primary judge appreciated the difference between a general claim, like claim 1, which Doric argued was obvious, and preferred embodiment claims, which Doric accepted in this Court were not obvious, although it had previously argued to the contrary before Hely J137. Having completed the task mandated by s 7(2), the primary judge concluded that Doric had failed to prove that claim 1 did not involve an inventive step. As claim 1 had been treated as representative of all dependent claims, no separate findings were made by his Honour in respect of claim 13. The decision of the Full Court The Full Court's analysis of obviousness commenced with a discussion of the identification of "the problem"138: "Doric identified the problem the invention was concerned to solve as the fact that, after an occupant had entered premises by unlocking the door from the outside and then closing it, the internal handle or knob remained locked until the key was used to unlock it from the inside. On the other hand Lockwood identified the problem as the fact that after the occupant had secured entry and closed the door, the occupant was locked inside, which arose from a number of factors, not just the fact that the internal handle remained locked after the door had been opened with the outside key." 136 (2001) 192 ALR 306 at 344-346 [217]-[225]. 137 (2001) 192 ALR 306 at 344 [214]. 138 (2005) 226 ALR 70 at 96 [116]. Callinan Crennan There is little distinction between these accounts of the perceived problem and they both echo the statement of the problem by this Court in its decision on fair basis, as set out above139. The Full Court then set out part of the specification which described the background to the Patent, whereby the lock was140: "typically arranged so as to be operated from the inside of the door and … not operable from the outside of the door. In particular, key operation of the latch from the outside of the door will not release the lock. That can lead to serious problems in circumstances where the door needs to be opened urgently from the inside". The Full Court labelled the fact that the key operation of the latch from the outside of the door would not deactivate the inside handle lock as a "deficiency" of conventional assemblies and said141: "[T]he deficiency the invention was designed to overcome was that inherent in the conventional assembly, namely that the key operation of the latch from the outside of the door did not release the inside lock. It is true that the specification refers to 'serious problems' arising from the configuration of is a mere the conventional assembly, but consequence of a deficiency in the assembly. In the context of construing a patent specification, the invention was not to solve the consequential problem, but to overcome an inadequacy in the existing art by remedying the deficiency in the assembly. Of course, if that deficiency were cured, the consequential problem would evaporate. But it was the initial deficiency to which the invention was directed." that The "proper question" was then described by the Full Court as follows142: "The importance of thus identifying the problem sought to be solved by the invention, and the inventive step employed to do so, is that it 140 (2005) 226 ALR 70 at 96 [117]. 141 (2005) 226 ALR 70 at 96 [118]. 142 (2005) 226 ALR 70 at 99 [130] (emphasis in original). Callinan Crennan enables the 'obviousness' question to be properly propounded: would it be obvious to an ordinary skilled but not inventive worker that the problem created by integer (iv) could be resolved by making the inside handle operable from outside the door? The question is not whether the hypothetical worker would have known how to achieve that result." Having laid that groundwork, the Full Court accepted a submission from Doric that there was no inventive step in conceiving of a remedy for the "deficiency" in known locks by any means using an outside actuator143. The Full Court expressed the essence of its reasoning as follows144: "Doric does not claim that the specification expressly admits that claim 1 (and thus claim 13 and the other live claims dependent on that claim) is obvious. Rather, it says that the specification admits that it was common general knowledge that, in the typical lock, the outside key did not release the inside lock." It seems that the Full Court's acceptance of Doric's submission based on Winner v Ammar Holdings Pty Ltd ("Winner")145 follows from a finding which it made that the specification contained the "implicit 'corollary' admission" that a solution to the deficiency, namely to use the outside key to deactivate the inside handle lock, was common general knowledge as at the priority date146. The circularity of such reasoning is immediately apparent, and makes it necessary to consider admissions in the specification in more detail later. The Full Court also reversed the primary judge's finding that s 7(3) did not assist Doric and found that the storeroom locks upon which Doric relied constituted s 7(3) information under the second limb of s 7(3)(a), that is, through a single act. In the result, the Full Court overruled the primary judge and found that claim 1 did not involve an inventive step. The Full Court did not distinguish claim 13 from claim 1 in coming to this conclusion, which reflected the way in which argument had proceeded before it. 143 (2005) 226 ALR 70 at 100-101 [137]. 144 (2005) 226 ALR 70 at 100 [137]. 145 (1992) 24 IPR 137. 146 (2005) 226 ALR 70 at 101 [138]-[140], 105 [156], 106 [159]. Callinan Crennan The Full Court's treatment of the witnesses The Full Court said it was unnecessary to refer to Mr Garland's evidence because what he had said about "the solution" was contrary to the fact that it was understood at the priority date that the solution was to use the outside key to release the inside lock. The Full Court approached the evidence of Mr Alchin in the same way147. Whilst the Full Court does not appear to have reversed the findings of the primary judge concerning Mr Garland and Mr Alchin, the Full Court stated148: "[N]othing that Mr Alchin or Mr Garland said about 'the solution' was to the contrary of the fact that it was understood at the priority date that a solution to the problem was to use the outside key to release the inside lock." That conclusion of the Full Court was premised on its "implicit 'corollary' admission" finding, explained above. After noting that Mr Wilson's evidence on the solution to the problem related to Lockwood's preferred embodiment, the Full Court concluded that it was not possible to derive from Mr Wilson's evidence "that it was not obvious to him that the problem could be solved by using the outside key to release the inside lock"149. With respect to the evidence of Mr Freestone, the Full Court found that what was in the "too hard" basket he had referred to was "the nitty gritty" of solving the problem, that is, something more than the idea of adding integer (vi) to integers (i)-(v) to be found in the Lockwood 001. But Mr Freestone had not been challenged with a view to establishing that proposition. Doric's submissions on common general knowledge in this Court Doric had not called witnesses to give direct evidence of the lack of inventive step at trial. In the absence of such evidence, Doric relied on the two 147 (2005) 226 ALR 70 at 105 [155]-156]. 148 (2005) 226 ALR 70 at 105 [156]. 149 (2005) 226 ALR 70 at 102 [144]. Callinan Crennan admissions in the specification: that first, the outside key did not deactivate the inside handle lock; and that secondly, as a result, people may be locked in150. In seeking to uphold the Full Court's conclusions in this Court, Doric contended that merely conceiving of the reverse of the first admission could not "involve an inventive step" as required by s 18(1)(b)(ii) of the Act. Doric accepted that the Full Court's reference to the "implicit 'corollary' admission" in the specification must be a reference to the solution to the problem being a corollary of the admission that the problem was common knowledge. Whilst Doric did not seek to uphold that aspect of the Full Court's reasoning, Doric submitted that although the specification did no more than admit that the patentee's locks existing before the priority date did not have integer (vi), the Court is entitled, as "a matter of judgment", to find that it is obvious to add integer (vi) to known locks, that is, to use the outside key to deactivate the inside handle lock. It was argued that the addition of integer (vi) to overcome the known disadvantage, that the key used outside on the Lockwood 001 did not deactivate the inside handle lock, did not involve an inventive step. The next step in Doric's argument was the contention that the primary judge made two errors in assessing the evidence of the witnesses. First, it was contended that he failed to distinguish between evidence directed to the concept or idea of a combination of integers (i)-(v) to which integer (vi) was added, and discrete evidence directed to the mechanical details of implementing that concept. Secondly, it was contended that the primary judge gave too much weight to secondary evidence, such as copying by Doric. It was correctly conceded by Doric that in forming a judgment as to whether an invention lacks an inventive step, it is necessary for a judge to consider and weigh all the relevant evidence when determining whether the addition of an integer to a known combination of other integers involves an inventive step. This is particularly the case where the added integer can be characterised as a "simple mechanical expedient", as it was in argument here. Lockwood's submissions on common general knowledge in this Court Lockwood relied on the primary judge's analysis of the problem as the problem of being "locked in", said to be grounded in the evidence. It was contended that there was no admission, express or implied, in the specification that non-inventive persons skilled in the art knew, before the priority date, that 150 (2001) 192 ALR 306 at 341 [202]. Callinan Crennan the solution to the problem of being "locked in" was to make the outside key perform what was for it a second function, namely deactivating the inside handle lock. Lockwood further submitted that there was evidence before the primary judge directed to the concept or idea of adding integer (vi) to the Lockwood 001. Most relevantly, the solution said by the Full Court to be part of common general knowledge, and therefore obvious, was not possessed at the priority date by the industry witnesses called by Doric. Lockwood also relied on Doric's copying of the "bare idea" of claim 1 as evidencing the inventive step. Admissions in a specification Admissions may be made in a specification, particularly about prior art and common general knowledge. This is consistent with conventional methods of drafting patent specifications intended and recognised as a way of clearly articulating the advance over prior art made by the invention. Such an approach also facilitates an understanding of the relevant inventive step, irrespective of whether the inventive step is identified with any precision in the specification, a task which may be difficult151. While not every invention constitutes a solution to a problem, it is commonplace so to describe an invention where it is appropriate to do so152. Admissions in a specification about any problem said to be overcome by an invention are made from the vantage point of knowing the solution. When used as evidence, they would always need to be weighed with evidence, if it exists, from persons skilled in the relevant art of their perception of any problem at the time before the priority date, before their exposure to any solution contained in the invention. In Chapman and Cook and Lectro Linx Ltd v Deltavis Ltd153 151 British United Shoe Machinery Company Ltd v A Fussell & Sons Ltd (1908) 25 RPC 631 at 650. 152 Patent examiners are encouraged to use the "problem/solution" approach: IP Australia, Australian Patent Office Manual of Practice and Procedures, (2006) at [2.5.1.6], "Assessing Inventive Step in Examination", <http://www.ipaustralia.gov. au/pdfs/patentsmanual/WebHelp/Patent_Examiners_Manual.htm>. 153 (1930) 47 RPC 163. 154 (1930) 47 RPC 163 at 173. Callinan Crennan "[I]f a Patentee, though entirely erroneously, does state by way of what I may call recital in his Specification that a particular form of thing is common and then by some oversight or some mistake claims a monopoly in that particular form of thing he will have, so to speak, recited himself out of Court and I venture to doubt whether he could possibly maintain any claim to a monopoly in a thing which he has recognised to be something which existed." Chapman may be understood as a case which exemplifies a specification showing "on its face" that an invention did not involve an inventive step. The from Commissioner of Patents v Microcell Ltd155 expression derives ("Microcell"), which stands for a narrow proposition that a Commissioner of Patents, or his or her delegate, may refuse an application for patent protection where a specification "on its face" shows the invention claimed is not a manner of new manufacture. This may arise, for example, from admissions concerning novelty. The decision in Microcell has not always been properly understood; it does not involve a separate ground of invalidity or a discrete "threshold" test156. It is also possible to imagine, as Lord Hoffmann did in Biogen Inc v Medeva plc157 that there may be cases where the alleged subject matter is "so obviously not an invention that it is tempting to take an axe to the problem by dismissing the claim"158. Such cases are likely to be rare. Although it is not usual for an express admission to be made in a specification that a crucial integer in a combination patent is common general knowledge159, when such an admission is made, a court is entitled to treat the 155 (1959) 102 CLR 232; referred to in the NRDC case (1959) 102 CLR 252. 156 N V Philips Gloeilampenfabrieken v Mirabella International Pty Ltd (1995) 183 CLR 655 at 664. 157 [1997] RPC 1. 158 [1997] RPC 1 at 42. See also Genentech Inc's Patent [1989] RPC 147 at 264 per Mustill LJ. 159 Allmanna Svenska Elektriska A/B v The Burntisland Shipbuilding Co Ltd (1951) 69 RPC 63. Callinan Crennan admission as part of the evidence to be considered on the issue of obviousness160. An admission in a specification that some integers of a combination are common general knowledge can be considered together with witnesses' evidence as to whether the remaining integers are also common general knowledge161. However, admissions of mixed fact and law will not necessarily be conclusive162 on the issue of common general knowledge163. Nor will they oust the trial judge's function of weighing all the evidence. In Sonotone Corporation v Multitone Electric Coy Ltd ("Sonotone")164, which concerned an invention that applied a known scientific principle to the construction of a hearing aid, the English Court of Appeal noted that express admissions in a specification about matters of common general knowledge must carry great weight but that such admissions do not estop a patentee from leading evidence in order to resile from them165. Blanco White's comment on Sonotone166 "that something nobody has ever suggested can in any sense form 160 Allmanna Svenska Elektriska A/B v The Burntisland Shipbuilding Co Ltd (1951) 69 RPC 63 at 72 per Jenkins LJ, delivering the judgment of the Court. See also Longbottom v Shaw (1891) 8 RPC 333 and Taylor and Scott v Annand and the Northern Press and Engineering Company Ltd (1900) 18 RPC 53. 161 Washex Machinery Corporation v Roy Burton & Co Pty Ltd (1974) 49 ALJR 12. 162 Dovuro Pty Ltd v Wilkins (2003) 215 CLR 317 at 331 [40] per McHugh J, 340-342 [68]-[71] per Gummow J, 372 [177] per Heydon J. See also, with respect to admissions as to copyright ownership made by an alleged infringer, the discussion by Burchett J in Commonwealth v Oceantalk Australia Pty Ltd (1998) 79 FCR 520 163 Blanco White, Patents for Inventions and the Protection of Industrial Designs, 5th ed (1983) at 87. 164 (1955) 72 RPC 131. 165 (1955) 72 RPC 131 at 139-140, followed in Gerber Garment Technology Inc v Lectra Systems Ltd [1995] FSR 492. See also Hoad v Swan (1920) 28 CLR 258 at 264 per Isaacs J, delivering judgment on behalf of the Court, which included Knox CJ and Rich J. 166 (1955) 72 RPC 131. Callinan Crennan part of existing knowledge seems almost a contradiction in terms"167 is particularly apposite to the notion that a solution to a problem is an "implicit 'corollary' admission" in a specification which states the problem. Admissions in a specification on common general knowledge are, without doubt, relevant but they are to be assessed as to their probative force like all other evidence. The specification in the Patent does not contain any express admission that integer (vi) was common general knowledge168. Nor does it contain any express admission that it was obvious to add integer (vi) to integers (i)-(v). The specification admits being "locked in" was a known problem. The specification admits it was known that the key used to unlock the door from outside in the product containing integers (i)-(v) did not deactivate the independent inside handle lock. There is no doubt the specification is explaining the development of an improved lock by reference to previously known locks. It is possible to take the admissions in the specification set out above, together with other evidence from witnesses, to find that it was a subset problem of the problem of being "locked in" that the Lockwood 001 lacked a safety release mechanism for the inside handle lock when the key to deactivate the inside handle lock was missing. For example, Mr Wilson, a locksmith called by Lockwood, said he "had been aware for many years of the problem of people locking themselves in their houses because the key to unlock the inside handle was not accessible"169. However, that is not an implication arising from the specification. That approach involves doing no more than considering the express admissions in the specification together with other evidence170. The Full Court implied that it was obvious to conceive the reverse of a statement in the specification which noted the absence of a feature in a prior art product. But the question of whether the concept of adding integer (vi) to integers (i)-(v) (claim 1) or to the combination of integers (i)-(v), and (vii)-(x) (claim 13) is inventive will turn on what a person skilled in the relevant art, possessed with that person's knowledge, would have regarded, at the time, as 167 Blanco White, Patents for Inventions and the Protection of Industrial Designs, 5th ed (1983) at 87. 168 cf Chapman (1930) 47 RPC 163. 169 (2001) 192 ALR 306 at 311 [12]. 170 As occurred in Washex Machinery Corporation v Roy Burton & Co Pty Ltd (1974) 49 ALJR 12. Callinan Crennan technically possible in terms of mechanics, and also as practical. That is the sense in which an idea can involve an inventive insight about a known product. A court cannot substitute its own deduction or proposition171 for that objective touchstone, except in the rarest of circumstances, such as where an expressly admitted matter of common general knowledge is the precise matter in respect of which a monopoly is claimed172. Even if an idea of combining integers, which individually may be considered mere design choices, is simple, its simplicity does not necessarily make it obvious. Older cases concerning simple mechanical combinations illustrate this point173, as does Haberman v Jackel International Ltd174. Common general knowledge has negative as well as positive aspects175. Practical and technical issues176 can affect the means by which a concept may be implemented in respect of an already known vendible product, and scepticism can inhibit recognition of the utility of applying a concept or idea to a known set of integers. These are matters within the knowledge of relevant witnesses. Further, the Full Court's approach contravened the long-established principle that a specification is to be construed in the light of common general knowledge177. 171 Technograph Printed Circuits Ltd v Mills & Rockley (Electronics) Ltd [1972] RPC 346 at 355 per Lord Reid, affirmed by Pumfrey J in Glaxo Group Ltd's Patent [2004] RPC 43. 172 Chapman (1930) 47 RPC 163. 173 See, for example, Taylor and Scott v Annand and the Northern Press and Engineering Company Ltd (1900) 18 RPC 53 at 63 per Lord Halsbury LC; Vickers, Sons & Co v Siddell (1890) 15 App Cas 496. 174 [1999] FSR 683 at 697-698 [29] and 706 [45] per Laddie J. 175 Dyson Appliances Ltd v Hoover Ltd [2001] RPC 26 at 490 [39], 491 [44] per Fish QC (sitting as a Deputy Judge of the High Court). 176 Hallen Co v Brabantia (UK) Ltd [1989] RPC 307 at 327 per Aldous J. See also Dyson Appliances Ltd v Hoover Ltd [2002] RPC 22 at 493 [87]-[88] per Sedley LJ; Molnlycke AB v Procter & Gamble Ltd (No 5) [1994] RPC 49. 177 Welch Perrin & Co Pty Ltd v Worrel (1961) 106 CLR 588 at 610; Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd (2001) 207 CLR 1 at 16 Callinan Crennan The evidence of witnesses In regard to Doric's submission and the Full Court's finding that the primary judge erred in failing to distinguish between evidence concerning the concept in claim 1 and evidence concerning preferred embodiments, it must be recognised that there were some unresolved obscurities and ambiguities in the evidence. These were occasioned to some extent by the way in which the trial was conducted. The primary judge did not exclude from his consideration of whether claim 1 involved an inventive step every single piece of evidence concerning preferred embodiments. Nor did he isolate or quarantine in some way every piece of evidence concerning the concept or idea of adding integer (vi) to integers (i)-(v) to be found in the Lockwood 001. Such an exercise would have been near impossible because the reference point in the prior art of greatest significance was the Lockwood 001, a known product with known mechanics. It would also have been impossible because, at trial, it was contended by Doric that the concept of adding integer (vi) (claim 1), that is any means to deactivate the inside handle lock from the outside, and the preferred embodiments, were all obvious. That approach permeated the evidence, including the oral evidence. integers (i)-(v) To that extent, debates on this appeal about whether references in the evidence were or were not exclusively references to the idea of adding integer (vi) the Lockwood 001 were, to be found occasionally, extremely cerebral. A good example was a debate over the meaning of the phrase "auto-unlocking". There was evidence that the phrase referred to a mechanism whereby the inside handle lock on the Lockwood 001 was released by a door slamming. It is clear the primary judge understood the phrase more generally to mean a safety release mechanism other than a key. Doric contended the phrase described the invention. Whether the phrase meant different things, depending on differing contexts, is a debate which the parties could not expect to have resolved in this Court. In any event, the main issue for this Court is whether the combination of integers in claim 13 involves an inventive step. This requires the consideration of the combination itself and any other evidence to determine whether the evidence, as a whole, supports the inventiveness of the combination. Secondary evidence Something further also needs to be said about secondary evidence. Secondary evidence, such as commercial success, satisfying a long-felt want or need, the failure of others to find a solution to the problem at hand and copying by others such as competitors, has a role to play in a case concerning an Callinan Crennan inventive step. In Molnlycke AB v Procter & Gamble Ltd (No 5)178 ("Procter & Gamble"), Nicholls VC warned that secondary evidence should not be permitted to "obscure the fact that it is no more than an aid in assessing the primary evidence"179. That observation can be compared with the treatment of secondary evidence in the United States of America. Under § 103 of the Patents Act 1952 (US) it is necessary to make a number of factual inquiries when making a determination of invalidity based on obviousness. The primary considerations include determining the scope and content of prior art, identifying the differences between the prior art and the advance over the prior art which is claimed and assessing the level of ordinary skill in the art. Secondary considerations of non-obviousness, if any, are also to be determined. In Graham v John Deere Company of Kansas City ("Graham")180 the Supreme Court of the United States identified the role of secondary evidence181: "Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc, might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented. As indicia of obviousness or nonobviousness, these inquiries may have relevancy." Since Graham, the inquiry into secondary considerations of non-obviousness has been treated as being an important inquiry which must be taken into account because prior art cannot be evaluated in isolation182. An Australian court should be slow to ignore secondary evidence or to rely on its own assumed technical expertise to reach conclusions contrary to such 178 [1994] RPC 49. Nicholls VC delivered the judgment of the Court. 179 [1994] RPC 49 at 113. See also Hoechst Celanese v BP Chemicals [1997] FSR 547 at 563, and Bently and Sherman, Intellectual Property Law, 2nd ed (2004) at 181 383 US 1 at 17-18 (1966). 182 De Witt, "Use of Objective Evidence of Non-Obviousness in the Federal Courts", (1997) 79 Journal of the Patent and Trademark Office Society 823 at 825-826. Callinan Crennan evidence183. Australian courts have long recognised that the importance of such evidence and its weight will vary from case to case; it will not necessarily be determinative184. Doric contended that secondary evidence should have been given little or no weight in this case and contrasted the facts here with those in Intalite International NV v Cellular Ceilings Ltd (No 2)185 by relying on the storeroom locks as solving the problem of being "locked in". However, Doric did not challenge here the primary judge's finding that such locks were not part of common general knowledge. Lockwood urged that such evidence should be taken into account like any other piece of relevant evidence. Doric's submission should be rejected because a combination patent cannot be assessed fairly as to its inventive step without considering and weighing properly such secondary evidence. It was of particular relevance to the primary judge that no non-inventive persons skilled in the art who were called as witnesses came up with the combination of claim 1 before the priority date, and that Doric (per Mr Alchin) copied the "bare idea" of Lockwood's improved lock. There was no error shown in the primary judge's reliance on secondary evidence and he was entitled to give it such weight as was appropriate in all the circumstances of the case. In summary, despite some obscurities as analysed by the primary judge, the evidence showed a felt want, the failure of others (including the inventive Mr Garland) to come up with the same solution as Lockwood, and the copying of Lockwood's "bare idea" by Doric. When skilled, non-inventive persons, and in this case also a skilled inventive person (Mr Garland), looking for improvements, fail to arrive at the invention, it is impossible to suggest that it would have been 183 Firebelt Pty Ltd v Brambles Australia Ltd (2002) 76 ALJR 816; 188 ALR 280; Bristol-Myers Squibb Co v FH Faulding & Co Ltd (2000) 97 FCR 524. 184 Firebelt Pty Ltd v Brambles Australia Ltd (2002) 76 ALJR 816 at 825-826 [47]-[50]; 188 ALR 280 at 292-293. See also Commonwealth Industrial Gases Ltd v MWA Holdings Pty Ltd (1970) 180 CLR 160; Olin Corporation v Super Cartridge Co Pty Ltd (1977) 180 CLR 236 at 262 per Stephen and Mason JJ. And see also Procter & Gamble [1994] RPC 49 at 113 per Nicholls VC, delivering the judgment of the Court. 185 [1987] RPC 537. Callinan Crennan obvious to the skilled and not necessarily inventive person186. The evidence supports the primary judge's findings. Conclusions regarding the decisions below The Full Court's approach to the evidence was coloured by the erroneous implication of the "corollary admission" which has already been discussed and it is not necessary to multiply illustrations of this error. The primary judge was right to conclude that Doric had not succeeded in establishing that claim 1 lacked an inventive step by reference to common general knowledge. The inferential conclusion, that claim 13 did not lack an inventive step by reference to common general knowledge, was tied to his conclusion in respect of claim 1. Sections 7(2) and 7(3) of the Act Section 7(2) contemplates that the standard by which obviousness is to be judged, namely a person skilled in the relevant art, would possess common general knowledge and have regard to any s 7(3) information. As touched upon already, lack of subject matter, the precursor to an objection based on obviousness, involved the need to determine the sufficiency of invention to sustain a patent. In 1894, Lord Esher MR made an observation187, echoed in Doric's submissions: "[W]hen you consider it, you come to the conclusion that it is so easy, so palpable, … that any fool could do it." There was no patentable subject matter when any person conversant with the art could achieve the result without any difficulty188. Similar language has been used in respect of combination claims for a very long time. To be 186 Intalite International NV v Cellular Ceilings Ltd (No 2) [1987] RPC 537 at 547 per 187 The Edison Bell Phonograph Corporation Limited v Smith (1894) 11 RPC 389 at 188 Sudbury v Lee (1894) 11 RPC 58 at 60 per Romer J. See also Vickers, Sons & Co v Siddell (1890) 15 App Cas 496 at 501-502 per Lord Herschell. Callinan Crennan patentable, a combination needed to be new, useful and to show a sufficient amount of invention189. Without a sufficient amount of invention, a combination was obvious. Despite the fact that the test for obviousness became qualitative rather than quantitative, once a statutory test was introduced, combinations which involve adding a single integer not within common general knowledge, to other integers within common general knowledge, may appear "easy", "palpable" or "simple". However, evidence from persons skilled in the art may confound such appearances. It has already been noted that what is obvious under the Patents Act 1977 (UK) is different from what was so considered under preceding legislation in the United Kingdom. The current approach has been considered by the Court of Appeal in Procter & Gamble190 in which Nicholls VC said191: "Under the statutory code … the criterion for deciding whether or not the claimed invention involves an inventive step is wholly objective. It is an objective criterion defined in statutory terms, that is to say whether the step was obvious to a person skilled in the art having regard to any matter which forms part of the state of the art as defined in section 2(2)." What is obvious under Australian law is to be determined by the combined operation of ss 7(2), 7(3), 18(1)(b)(ii) and Sched 1 to the Act. These provisions are all directed to determining whether an invention "is to be taken to involve an inventive step when compared with the prior art base" (s 7(2)). Schedule 1 defines "prior art base" and s 7(3) contains the statutory test for enlarging the prior art base beyond common general knowledge. As stated above, by enlarging the prior art base through including relevant prior disclosures beyond those disclosures proven to be part of the common general knowledge, these provisions raise the threshold for inventiveness. However, the idea remains that the prior disclosures to be taken into account, even as enlarged by s 7(3), are being considered for a particular purpose. That purpose is the purpose of looking forward from the prior art base to see what a 189 Crane v Price (1842) 4 Man & G 580 at 605 [134 ER 239 at 249] per Tindal CJ delivering the judgment of the Court. 190 [1994] RPC 49. 191 [1994] RPC 49 at 112, delivering the judgment of the Court. Callinan Crennan person skilled in the relevant art is likely to have done when faced with a similar problem which the patentee claims to have solved with the invention. Having found that claim 1 (and inferentially claim 13) was not obvious by reference to common general knowledge, the primary judge turned to consider whether there was information which would qualify as s 7(3) information which would need to be combined with common general knowledge to determine obviousness or lack of inventive step. Before the primary judge, Doric relied on information made public before the priority date by the acts of sales, taken individually, of: storeroom locks; the Abloy rim lock; the sliding door locks; the Boyd mortice lock; and the Lockwood 530. By the time of this appeal Doric only relied on the storeroom locks as being the locks which the Full Court considered under s 7(3). In fact, the Full Court only made findings about the storeroom locks, which it said rendered it unnecessary to consider whether the sale of the Lockwood 530 was information falling within s 7(3)192. In fact, the Lockwood 530 only differed from the storeroom locks by having a snib mechanism. The "prior art base" The primary judge There was no doubt that each of the storeroom locks had been the subject of an act of sale and the primary judge had found that each contained integer (vi). The primary judge also found that, having regard to the large range of locks on the market and the costs of acquiring them and taking them apart, he was not satisfied that a skilled addressee, before the priority date, would 192 (2005) 226 ALR 70 at 110 [180]. Callinan Crennan reasonably be expected to have "ascertained" the storeroom locks. The primary judge also relied on Mr Freestone's evidence that, in comparing lock designs, he would only take into account the rim mounted locks193 as the basis of a finding that storeroom locks and the Lockwood 530 could not reasonably be "regarded as relevant" to the skilled addressee. The Full Court The Full Court overruled the decision of the primary judge on these two points. First, the Full Court held, correctly, that "ascertained" simply means discovered or found out. Therefore, locks do not need to be purchased and taken apart to be "ascertained" within the meaning of s 7(3). It also held, again correctly, that "understood" means that, having discovered the information, the skilled addressee would have "comprehended it" or "appreciated its meaning or import"194. Next, the Full Court held that the primary judge had failed to differentiate between the general claim 1 and the preferred embodiment claims. The Full Court said195: "Claim 1, and thus claim 13 and the other dependent claims, is not limited to rim mounted locks or even to locks for doors." Then, by reference to the combination of integers in claim 1, the Full Court held that the storeroom locks, which are not rim mounted locks, and which disclose the integers of claims 1-6, would reasonably have been "regarded as relevant" by a skilled addressee196. This led the Full Court to find that the primary judge should have treated the storeroom locks as s 7(3) information, with the result that "the alleged invention in claim 1 would have been considered obvious"197. The Full Court did not proceed to make any detailed finding on the question of whether claim 1 lacked an inventive step having regard to common 193 (2001) 192 ALR 306 at 345 [221]-[222]. 194 (2005) 226 ALR 70 at 110 [179]. 195 (2005) 226 ALR 70 at 107 [168]. 196 (2005) 226 ALR 70 at 110 [179]. 197 (2005) 226 ALR 70 at 110 [180]-[181], see also 105 [156] and 106 [159]. Callinan Crennan general knowledge combined with any s 7(3) information198. The Full Court made no express findings in respect of the combination of integers in claim 13 and dependent claims. Doric's initial submissions on s 7(3) Doric relied on the words in s 7(3) as referring to a lesser test than the test set out in Minnesota Mining199 and Alphapharm200. To the extent that "lesser" was intended to mean a test which would make it harder for the invention to be shown to involve an inventive step over the prior art base, this submission is correct. Doric contended that each of the persons skilled in the relevant art knew of one or other of the storeroom locks and that therefore it could not be suggested that those locks, as pieces of prior art information, were not "ascertained" and "understood" by those persons, and that the primary judge erred in construing "ascertained" as requiring that those locks be disassembled in order to determine whether they were relevant to the broad claim, claim 1. That submission should also be accepted. The next step in Doric's argument was that, given that claim 1 covered both rim mounted locks and non rim mounted locks, the primary judge erred in finding that only rim mounted locks would reasonably be relevant to the person skilled in the relevant art when approaching the problem known to exist with the Lockwood 001. Lockwood's initial submissions on s 7(3) Lockwood relied on evidence from Mr Garland, Mr Alchin and evidence associated with Mr Blanch to the effect that none of them referred to storeroom locks as relevant to solving the problem of being "locked in" with the Lockwood 001, a rim mounted lock or any equivalent product. It became clear during the hearing of the appeal to this Court that Lockwood's submissions on s 7(3), which were directed to upholding the findings of the primary judge, 198 (2005) 226 ALR 70 at 110 [180]-[181]. 199 (1980) 144 CLR 253. 200 (2002) 212 CLR 411. Callinan Crennan depended largely on the contention that the factual environment in which the obviousness of claim 13 was to be considered was that of rim mounted locks. In those circumstances, the parties were given an opportunity further to address this Court on the question of whether a court can distinguish between a broad and narrow claim with the result that the information "regarded as relevant", under s 7(3), would not necessarily be identical for both claims. As already mentioned, both Lockwood and Doric agreed correctly that a court could distinguish between a broad and narrow claim for the purposes of determining what might be "regarded as relevant" for s 7(3) purposes. Before turning to the "prior art base" as determined by applying s 7(3), it the is necessary Lockwood 001, claim 1, claim 13 and the storeroom locks, bearing in mind the distinction between a rim mounted lock, and one which is not. to say something more about the subject matter of The Lockwood 001 This lock was a rim mounted lock. It contained detent means which moved radially in respect of the axis of a cam. The lock achieved outside security against entry, after an occupant entered, but was subject to the "locked in" problem already explained. Claim 1 Claim 1, containing integer (vi), covered locks which were not rim mounted and rim mounted locks, and also locks with detent means which moved axially or radially. Claim 13 Claim 13, also containing integer (vi), was narrower than claim 1. The novelty of claim 13, over the storeroom locks, reposed in its extra integers (ix) and (x) of a cam and "detent means" which "includes at least one detent which moves substantially radially of [the] said cam axis". The storeroom locks The storeroom locks were not rim mounted locks. They contained detent means which moved axially. They contained integer (vi); however, the storeroom locks did not give outside security against entry without deliberate locking. Storeroom locks fall within claim 1 but do not fall within claim 13. Callinan Crennan Lockwood's supplementary submissions in respect of s 7(3) By reference to the need to consider each claim separately mandated by the opening words of s 18(1), Lockwood emphasised that the information to be regarded as relevant to claim 13 was information in the field of rim mounted locks, that being the field which a person skilled in the relevant art needed to consider when addressing the "locked in" problem posed by the rim mounted Lockwood 001. It was submitted that s 7(3) ought not be construed to admit information that is relevant generally to the lock industry, regardless of the particular field of the invention. Alternatively, if "the relevant art" for s 7(3) purposes were to be construed more broadly than that, Lockwood submitted that the evidence discussed above showed locks would nevertheless not have been "regarded as relevant to work in the relevant art" for the purpose of solving the Lockwood 001 problem. the storeroom that Doric's supplementary submissions in respect of s 7(3) Doric submitted that a narrower claim may be less likely to be obvious, but only in one of two circumstances: if the additional integers of the narrower claim change the nature of the inventive step; or if the additional integers of the narrower claim affect the prior art base with which the invention is being compared. Doric relied on the fact that the primary judge held that the "relevant field is that of manufacture and design of locks"201 and on the fact that it had always been common ground that claims 1 and 13 involve precisely the same inventive step, and therefore the relevance of the storeroom locks is precisely the same for claim 1 as it is for claim 13. The application of s 7(3) It is not to be doubted that ss 7(2), 7(3) and 18(1) read together provide that each claim needs to be examined independently of the other claims when considering whether an alleged invention involves an inventive step. It is also axiomatic that an alleged invention in a combination of integers which 201 (2001) 192 ALR 306 at 335 [165]. Callinan Crennan constitutes a solution to a particular problem must necessarily involve rejecting other combinations of other integers202 as a solution to that particular problem. The exercise, of which s 7(3) is an integral part, is the exercise of determining whether "an invention" (s 7(2)) as disclosed "in any claim" (s18(1)) "involve[s] an inventive step when compared with the prior art base" (s 7(2)). The "prior art base" for s 7(2) is enlarged by s 7(3), so as to go beyond common general knowledge and to bring into consideration "prior art information" which "could ... be reasonably expected to have [been] ascertained, understood and regarded as relevant to work in the relevant art" (s 7(3)) by "a person skilled in the relevant art" (s 7(2)). This brings to mind Lord Reid's reference to a "diligent searcher" in Technograph Printed Circuits Ltd v Mills & Rockley (Electronics) Ltd203 and suggests a person skilled in the relevant art familiar with some, but not necessarily every piece of, publicly available information in the relevant art beyond common general knowledge. Construction of ss 7(2) and 7(3) The proper construction of ss 7(2) and 7(3) has been considered in Firebelt Pty Ltd v Brambles Australia Ltd204 ("Firebelt"). In recognising that s 7(3) relaxes the previous rule under the 1952 Act which forbade the use of prior disclosures not proved to be part of the common general knowledge at the priority date, this Court approved a statement by Burchett J in the Federal Court where he noted that s 7(3) in its pre-2001 version is limited205: "by the words 'being information that the skilled person ... could, before the priority date of the relevant claim, be reasonably expected to have ascertained, understood and regarded as relevant to work in the relevant art in the patent area'. And if a prior [disclosure] passes those tests, it must still be able to be said that, if that [disclosure] had been considered 202 Alphapharm (2002) 212 CLR 411 at 429 [41] following Minnesota Mining (1980) 144 CLR 253 at 293 per Aickin J; see also Elconnex Pty Ltd v Gerard Industries Pty Ltd (1992) 25 IPR 173 at 184 per Lockhart J. 203 [1972] RPC 346 at 355. 204 (2002) 76 ALJR 816 at 821-823 [31]-[36]; 188 ALR 280 at 287-289. 205 Tidy Tea Ltd v Unilever Australia Ltd (1995) 32 IPR 405 at 414. Callinan Crennan by the hypothetical skilled person together with the common general knowledge at the relevant time, 'the invention would have been obvious'." That passage, noting the words of limitation in s 7(3), reflects the two statutory tests which have already been mentioned: the s 7(2) test of whether an invention is obvious when compared with the prior art base, and the s 7(3) test of whether information is to be included in the prior art base, each test to be determined objectively by the standard of "a person skilled in the relevant art". Given the history, context, purpose and specific words of limitation in s 7(3), all of which were addressed by this Court in Firebelt206, the phrase "relevant to work in the relevant art" should not be construed as meaning relevant to any work in the relevant art, including work irrelevant to the particular problem or long-felt want or need, in respect of which the invention constitutes an advance in the art. The phrase can only be construed as being directed to prior disclosures, that is publicly available information (not part of common general knowledge) which a person skilled in the relevant art could be expected to have regarded as relevant to solving a particular problem or meeting a long-felt want or need as the patentee claims to have done. Otherwise the words of limitation in the last 40 words of s 7(3) would have no role to play. Any piece of public information in the relevant art would be included, as is the case with the much broader and quite different formulation in the cognate provisions in the United Kingdom207, which do not depend on the standard of a skilled person's opinion of the relevance of the information. The question of what a person skilled in the relevant art would regard as relevant, when faced with the same problem as the patentee, is to be determined on the evidence. The starting point is the subject matter of the invention to be considered together with evidence in respect of prior art, common general knowledge, the way in which the invention is an advance in the art, and any related matters. It should be mentioned that the starting point is not necessarily the inventive step as claimed, or even agreed between parties, because the evidence, particularly in respect of a combination of integers, may support a different inventive step. 206 (2002) 76 ALJR 816 at 823 [36]; 188 ALR 280 at 289. 207 Patents Act 1977 (UK), s 2(2) set out above at [58]. Callinan Crennan There was no real disagreement that, however one characterised the problem to be solved, it was a problem with a known product, the Lockwood 001, which was a rim mounted lock. There was no disagreement that each of integers (i)-(v) (in claim 1) and (ix) and (x) (in claim 13) was part of common general knowledge because each was a feature of the Lockwood 001. There was no challenge by Doric to the primary judge's finding that storeroom locks containing integer (vi) were not part of common general knowledge. Irrespective of the breadth of claim 1, the person skilled in the relevant art would be seeking to resolve a problem known to exist with a rim mounted lock. The only locks identified as falling within claim 13 and dependent claims were rim mounted locks. Claim 13 did not cover any lock which was not a rim mounted lock with detent means which moved axially. The Full Court recognised that Mr Freestone's evidence was directed to the internal workings of various locks which "may well be apposite to the design of a new rim mounted lock, such as an improvement of the old 001"208. The extra integers of claim 13 (integers (ix) and (x)) deal with the internal workings of the combination claimed, insofar as claim 13 has a cam and a detent means which moves substantially radially of the cam axis. There was no evidence from any witness that he would have regarded storeroom locks as relevant to the combination of integers in claim 13, and it was uncontested that the storeroom locks did not have the locking means of claim 13, such locking means being referable to rim mounted locks. Relevantly, the combination of integers in claim 13 included detent means which moved radially of the axis of the cam, such detent means being absent from the storeroom locks which contained detent means which moved axially. Further, there was evidence that detent means which moved radially of the axis of a cam were a feature relevant to ensuring outside security after having entered and shut a door. Any solution to the "locked in" problem with the Lockwood 001 needed to preserve that outside security without an occupant of the premises becoming locked in. The storeroom locks which employed detent means which moved axially did not give outside security unless a deliberate step was taken to lock oneself in. The storeroom locks were not perceived as being 208 (2005) 226 ALR 70 at 108 [168]. Callinan Crennan subject to any problem as they were not necessarily required to give outside security against entry. Comparison of the combination of features in the storeroom locks and the combination in claim 13, tends to show that storeroom locks taught away from the invention as claimed in claim 13. That comparison does not immediately lead to any conclusion that the storeroom locks were relevant to the advance in the art represented by the invention in claim 13, or to a conclusion that the invention in claim 13 was somehow obvious on its face. The comparison assists in understanding the evidence of witnesses in relation to their perception of the problem with the Lockwood 001 and possible solutions. Mr Garland, a person of inventive faculty, said that if he had been asked to solve the problem he would have considered locks which were rim mounted and those which were not. However, he did not mention storeroom locks, with which he was familiar, as relevant locks to which he would have had regard in solving the problem. He referred only to the DS60 lock (which was not rim mounted and which had a spring biased to the unlatched position and detent means which moved radially to the longitudinal axis) as relevant to solving the problem. Mr Alchin did not mention any storeroom locks, with which he was familiar, as relevant locks to which he actually had regard. He gave evidence that he was inspired by the DS60 lock. However, the primary judge found he was inspired by the new Lockwood 001. Finally, such documentary evidence as there was in relation to the inventor, Mr Blanch, did not contain any reference to storeroom locks. As determined by Hely J, the relevant art was the "manufacture and design of locks"209. This was a form of shorthand to describe the field relevant to the invention in claim 13, as Lockwood did, as that of rim mounted locks. This is explained, at least in part, by the fact that detent means which operated radially of the axis of the cam were a characteristic of rim mounted locks. The evidence from all persons skilled in the relevant art showed that the prior art base with which the invention in claim 13 needed to be compared depended on the particular combination of integers in claim 13, including integers (ix) and (x). The Lockwood 001 was rim mounted and employed a detent means which moved radially of the axis of the cam; and whilst it ensured outside security against entry, it had the disadvantage of potentially causing a person to be 209 (2001) 192 ALR 306 at 335 [165]. Callinan Crennan "locked in". It was that combination, and not the integers considered singly, which appears to have affected the skilled persons' perceptions of what was relevant, in the prior art before the priority date, to solving the problem. The skilled persons who gave evidence treated "work in the relevant art" as "work" relevant to resolving the "locked in" problem with the Lockwood 001. None of them contemporaneously regarded the information conveyed by the storeroom locks as relevant to that work and none of them possessed the solution in claim 13, despite their familiarity with one or other of the storeroom locks. Mr Garland understood the workings of the storeroom locks and was well aware of the potential seriousness of the "locked in" problem with the Lockwood 001. He was briefed, as an inventive person, to design a rim mounted dead latch to compete with the Lockwood 001. If he had thought of the solution to the "locked in" problem before the priority date he would have passed it on to Doric. He conceded that solutions he now sees in the field have been seen as he was "looking back on [the particular problem]". The evidence of what actually happened before the priority date in terms of what was considered by skilled persons (one of whom was inventive) to be relevant to the problem cannot be displaced by constructing a prior art base for claim 13 by reference to the broader claim 1, or by preconceived ideas of the inventive step involved. The facts here lead to the conclusion that the information conveyed by acts of sales of the storeroom locks, assessed by reference to the statutory test in s 7(3), does not qualify as s 7(3) information for inclusion in the prior art base for claim 13. It is not, strictly speaking, necessary to go further. But let it be assumed that the information qualified for inclusion in the prior art base for claim 13, pursuant to s 7(3). On that assumption, the question which s 7(2) requires to be asked is: "If that information had been considered by a person skilled in the relevant art together with common general knowledge would the invention in claim 13 have been obvious?" The evidence permits only one answer to that question: No. The correct application of s 7(2) in the light of these reasons leads to the conclusion that the combination of integers contained in the invention which is the subject matter of claim 13 involves an inventive step over the prior art base. Conclusions The conclusions arrived at may be summarised as follows. The Full Court erred in finding that there was an "implicit 'corollary' admission" in the Patent Callinan Crennan specification which led to the result that the solution to the problem with the Lockwood 001 was part of common general knowledge. The Full Court correctly construed the references to "ascertained" and "understood" in s 7(3) of the Act. The Full Court correctly treated the art relevant to the Patent as the manufacture and design of locks. The Full Court was never invited to distinguish between what was "relevant" in respect of claim 1 and what was "relevant" in respect of claim 13 and it did not do so. The Full Court's finding that the sales of the storeroom locks could reasonably be regarded as s 7(3) information leading to the result that the alleged invention in claim 1 would have been considered obvious can hardly be criticised when it is recognised that storeroom locks fall within claim 1, and that the subject matter of claim 1 includes locks which were not rim mounted and rim mounted locks, as well as locks with detent means which moved axially, and locks with detent means which moved radially. However, the inferential conclusion of the Full Court, that claim 13 was obvious because claim 1 was obvious, was erroneous, as has been explained in these reasons. Although it is not necessary to this appeal to make any determination in respect of claim 1, a comparison of information disclosed by the sale of storeroom locks with the combination of integers in claim 1 might lead a court to conclude that there was plainly no inventive step involved in that claim when compared with the prior art base enlarged by the information conveyed by sales of the storeroom locks. Amendment Section 22 of the Act provides: "The invalidity of a patent in relation to a claim does not affect its invalidity in relation to any other claim." Section 138(3)(b) provides that a court "may, by order, revoke the patent, either wholly or so far as it relates to a claim" on the ground "that the invention is not a patentable invention" as required by s 18(1). Section 105 provides that on the application of the patentee a court may, by order, direct the amendment of the patent. Lockwood's primary submission was that there was no need to amend claim 13 if claim 13 is found to involve an inventive step; in the alternative, Lockwood made an application as required under s 105. Doric acknowledged a distinction between amendments of a "consequential" or a "validating" nature but Callinan Crennan nevertheless submitted that discretionary considerations in this case meant that any rewriting of the Patent's claims may go beyond consequential rewriting. Given the course of this litigation and the extant orders for revocation of certain claims in the Patent made by the primary judge, it seems appropriate that orders be made under s 105 to ensure the clarity of the Register, for it records public information, available to be searched by interested parties. There is no implied limitation in s 105 as to orders which can be made. Lockwood made it plain to this Court it does not, and will not at any time in the future, seek any resuscitation of claims 1 and 12 revoked by the primary judge. Lockwood now seeks to amend the Patent by the deletion of claims 1 and 12 and by making consequential amendments to claims 2, 3, 4, 7 and 13. Amendments should be considered after notice to the Commissioner of Patents. It is therefore convenient to remit Lockwood's application to amend the Patent to the Full Court of the Federal Court, leaving it to the Full Court of the Federal Court to determine whether any or all of the matters remitted, excepting the costs of the appeals to the Full Court and the proceeding before the primary judge, are best heard and determined by a single judge of that Court. The orders and directions to be made are to be understood by reference to the orders made by the primary judge. The Full Court ordered that, subject to a stay order, claims 1-6, 12-15, 20, 21 and 30-32 be revoked for lack of inventive step. However, the primary judge's findings in relation to the lack of novelty of claims 1-6, 12, 31 and 32, which led to an order for their revocation, were not subject to any appeal in the Full Court. Accordingly, in the light of these reasons, and extant orders made by the primary judge which remain undisturbed, the whole of the Full Court's order in respect of revocation of claims for lack of inventive step must be set aside. Orders The following orders should be made: The appeal against the judgment of the Full Court of the Federal Court be allowed. Order 2 of the orders made by the Full Court of the Federal Court on 20 December 2005, that claims 1-6, 12-15, 20, 21 and 30-32 of the Patent be revoked for lack of inventive step, be set aside. 3. Orders 3, 7 and 8 of the orders made by the Full Court of the Federal Court on 20 December 2005 be set aside. Callinan Crennan Doric, by itself, its directors, servants or agents or otherwise howsoever during the term of the Patent, be restrained from infringing claims 13, 14, 15, 20 and 30 of the Patent, and in particular from: importing, making, hiring, selling, supplying or otherwise disposing of or offering to make, hire, sell, supply or otherwise dispose of or using or keeping for the purpose of doing any of those things a latch assembly including without limitation the following features: a casing; a latch bolt mounted on the casing so as to be movable relative thereto between an extended latching position and a retracted release position; (iii) a first actuator operable from an inner side of the assembly to cause movement of the latch bolt to said release position; locking means operable from said inner side of the assembly to adopt an active condition and thereby render said first actuator inoperable; (vii) a second actuator operable from an outer side of the assembly to cause movement of the latch bolt to the release position; lock release means which is responsive to said operation to the second actuator so as to thereby render said locking means inactive; said locking means including detent means which is movable between an actuator locking position and an actuator release position which corresponds to said active and inactive conditions respectively of said locking means; (viii) cam means which is operable to control which of said positions is adopted by said detent means; said cam means including a cam which is movable about an axis of rotation between first and second positions of rotation so as to thereby control said detent means; and Callinan Crennan said detent means including at least one detent which moves substantially radially of said cam axis when moving between said actuator locking and release positions; and authorising another person to do any of the acts specified in sub-paragraph (a) above. The matter be remitted to the Full Court of the Federal Court for the determination of Lockwood's application to amend claims of the Patent by deletion of claims 1 and 12 and by consequential amendments to claims 2, 3, 4, 7 and 13. The matter be remitted to the Full Court of the Federal Court to make orders disposing of the costs of the appeals to that Court and the The matter be remitted to the Full Court of the Federal Court also for the making of further orders and the determination of the remaining issues, including without limitation: orders for delivery up; the issuance of a certificate of validity pursuant to s 19 of the Act; and orders for damages or an account of profits. Doric to pay Lockwood's costs of the appeal to this Court.
HIGH COURT OF AUSTRALIA HEALTH WORLD LTD APPELLANT AND SHIN-SUN AUSTRALIA PTY LTD RESPONDENT Health World Ltd v Shin-Sun Australia Pty Ltd [2010] HCA 13 21 April 2010 S199/2009 & S200/2009 Matter No S199/2009 ORDER The appeal be allowed. The orders made by the Full Court of the Federal Court of Australia on 17 February 2009 in Federal Court proceeding NSD 394 of 2008 be set aside. The proceeding be remitted to the Full Court of the Federal Court of Australia for determination of the remaining issues. The respondent to pay the appellant's costs of the appeal. The respondent to pay the appellant's costs of the appeal in Federal Court proceeding NSD 394 of 2008. Matter No S200/2009 The appeal be allowed. The orders made by the Full Court of the Federal Court of Australia on 17 February 2009 in Federal Court proceeding NSD 395 of 2008 be set aside. The proceeding be remitted to the Full Court of the Federal Court of Australia for determination of the remaining issues. The respondent to pay the appellant's costs of the appeal. The respondent to pay the appellant's costs of the appeal in Federal Court proceeding NSD 395 of 2008. On appeal from the Federal Court of Australia Representation S C G Burley SC with J S Cooke for the appellant (instructed by Bennett & Philp) J R Baird SC with P L Arcus for the respondent (instructed by Middletons Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Health World Ltd v Shin-Sun Australia Pty Ltd Intellectual property – Trade marks – Standing – Trade Marks Act 1995 (Cth) ("the Act"), ss 88 and 92 – Appellant and respondent both registered trade marks in class 5 for pharmaceutical products – Appellant sought cancellation of registration of respondent's trade mark under s 88 and removal of trade mark from Register under s 92 of the Act – Respondent claimed appellant not impeded in ownership and use of own trade mark by registration of respondent's trade mark – Whether appellant "aggrieved" under s 88(1) or s 92(1) of the Act – Whether "aggrieved" to be construed liberally – Whether actual desire or intention to use trade mark required to be "aggrieved" – Whether proof of adverse impact required to be "aggrieved". Statutes – Statutory interpretation – Meaning of "aggrieved" – Subject, scope and purpose of statute – Whether "aggrieved" should be construed liberally. Words and phrases – "aggrieved person", "person aggrieved". Trade Marks Act 1995 (Cth), ss 52, 59, 88, 92. FRENCH CJ, GUMMOW, HEYDON AND BELL JJ. These are two appeals from the decision of the Full Court of the Federal Court of Australia (Emmett, Besanko and Perram JJ)1 which dismissed two appeals from a decision of a judge of that Court (Jacobson J)2. The primary judge dismissed three proceedings between the present appellant, Health World Ltd ("Health World"), and the present respondent, Shin-Sun Australia Pty Ltd ("Shin-Sun"). In the Full Court and in this Court the appeals were heard together. The appeals turn upon provisions of the Trade Marks Act 1995 (Cth) ("the Act"). Section 88(1) confers standing upon an "aggrieved person" and s 92(1) upon a "person aggrieved". In deciding that Health World did not satisfy these criteria the Full Court applied the reasoning in an earlier Full Court decision, Kraft Foods Inc v Gaines Pet Foods Corporation3 ("Kraft's case"). The appeals to this Court by Health World should be allowed for the following reasons. The factual background The three proceedings arose out of the following circumstances. Health World's business. In 1991 Health World began manufacturing and supplying a probiotic powder. The powder contains quantities of acidophilus bacteria. It has been marketed under the name "Inner Health". Since 2000 Health World has also manufactured and supplied probiotic capsules. The capsules contain greater quantities of acidophilus than the powder, and other live bacteria as well. They are marketed under the name "Inner Health Plus". The primary judge found that the Inner Health Plus capsules have obtained a measure of success in the marketplace. Shin-Sun's business. In 2001 Shin-Sun began preparing to manufacture and sell natural health supplements derived from squalene and shark cartilage, and from bees or beeswax, under the label "HealthPlus". 1 Health World Ltd v Shin-Sun Australia Pty Ltd (2009) 174 FCR 218. 2 Health World Ltd v Shin-Sun Australia Pty Ltd (2008) 75 IPR 478. (1996) 65 FCR 104. Bell The applications for registration. On 7 May 2001 Shin-Sun applied for registration of "HEALTHPLUS" as a trade mark in class 5 for "[p]harmaceutical products including vitamins and dietary supplements". On 12 September 2001 Health World applied for registration of "INNER HEALTH PLUS" as a trade mark in class 5 for "[p]harmaceutical preparations; dietetic substances adapted for medical use; products in this class sold by pharmacies and/or health food shops including vitamins, minerals, health foods, dietary foods, Chinese and ayurvedic herbs, and nutrition bars included in this class". Health World's notice of opposition. In December 2001 Health World the filed a notice of opposition "HEALTHPLUS" trade mark. It claimed that Shin-Sun's "HEALTHPLUS" mark was deceptively similar to its "INNER HEALTH PLUS" mark. The opposition failed before the Registrar of Trade Marks. The Federal Court of Australia (Cooper J) dismissed an appeal from the Registrar's decision4. The mark "HEALTHPLUS" was entered on the Register on 28 February 2005. to Shin-Sun's application to register Shin-Sun's notice of opposition. On 15 August 2003 Shin-Sun filed a notice of opposition to the registration of "INNER HEALTH PLUS". Shin-Sun later withdrew its opposition. On 17 February 2005 "INNER HEALTH PLUS" was entered on the Register. the Register, a range of products using The parties' trading activities. In August 2004, before either mark was entered on trade mark "HEALTHPLUS" was launched. Though Shin-Sun had applied to register the "HEALTHPLUS" trade mark, its name did not appear on the products. Instead they bore the name of an associated company, Nature's Hive Pty Ltd ("Nature's Hive"). Like items in Health World's "INNER HEALTH PLUS" range of products, which had been in the market for some time, items in the "HEALTHPLUS" range were mainly sold in health stores and were natural health supplements. Many of them were listed in the Australian Register of Therapeutic Goods. the The first proceeding. On 13 February 2006 Health World commenced what may be called "the first proceeding" in the Federal Court. It claimed to be the registration of an "aggrieved person", and sought cancellation of 4 Health World Ltd v Shin-Sun Australia Pty Ltd (2005) 64 IPR 495. Bell "HEALTHPLUS" under s 88(1) of the Act5. It did so on the ground, inter alia, that Shin-Sun did not intend to use the mark "HEALTHPLUS" in Australia. On 31 May 2006 Health World overcame an obstacle raised by Shin-Sun to the first proceeding in relation to another contention: the primary judge held that the 5 At the relevant time s 88 relevantly provided: "(1) Subject to subsection (2) and section 89, a prescribed court may, on the application of an aggrieved person, order that the Register be rectified by: cancelling the registration of a trade mark … (2) An application may be made on any of the following grounds, and on no other grounds: any of the grounds on which the registration of the trade mark could have been opposed under Division 2 of Part 5; because of the circumstances applying at the time when the application for rectification is filed, the use of the trade mark is likely to deceive or cause confusion for a reason other than one for which: the application for the registration of the trade mark could have been rejected under section 43 or the registration of the trade mark could have been opposed under section 60 …" Among the grounds referred to in s 88(2)(a) is s 59. Section 59 provided in part: "The registration of a trade mark may be opposed on the ground that the applicant does not intend: to use, or authorise the use of, the trade mark in Australia … in relation to the goods and/or services specified in the application." Bell decision of Cooper J did not estop Health World from contending that Shin-Sun's mark "HEALTHPLUS" was substantially identical with or deceptively similar to Health World's mark "INNER HEALTH PLUS"6. The second proceeding. On 25 July 2006 Health World instituted what may be called "the second proceeding" in the Federal Court. In the second proceeding Health World contended that it was a "person aggrieved" within the meaning of s 92(1) of the Act7 and sought removal of the "HEALTHPLUS" trade 6 Health World Ltd v Shin-Sun Australia Pty Ltd (2006) 68 IPR 557. 7 At the material time s 92 relevantly provided: "(1) A person aggrieved by the fact that a trade mark is or may be registered may, subject to subsection (3), apply to the Registrar for the trade mark to be removed from the Register. (4) An application under subsection (1) or (3) (non-use application) may be made on either or both of the following grounds, and on no other grounds: that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith: to use the trade mark in Australia; or (iii) to authorise the use of the trade mark in Australia; to assign the trade mark to a body corporate for use by the body corporate in Australia; in relation to the goods and/or services to which the non- use application relates and that the registered owner: has not used the trade mark in Australia; or has not used the trade mark in good faith in Australia; (Footnote continues on next page) Bell mark under s 92. It claimed that when Shin-Sun filed its application for registration, it had no intention in good faith to use the mark in Australia (s 92(4)(a)(i)) and that the mark had not been used within the period described in s 92(4)(b). The second proceeding rested on the contention that neither Shin-Sun nor Nature's Hive launched the "HEALTHPLUS" range of products into the Australian market until August 2004, which was after the expiration of the three year period referred to in s 92(4)(b). The third proceeding. On 15 September 2006 Shin-Sun commenced what may be called "the third proceeding" in the Federal Court. The third proceeding sought removal of Health World's mark "INNER HEALTH PLUS" from the Register pursuant to s 92 of the Act, so far as it was registered in respect of goods other than certain probiotic products. The result of the first proceeding. The three proceedings were heard together. The primary judge dismissed the first proceeding on the ground that Health World was not "an aggrieved person" under s 88(1) of the Act. Had he not done so, the primary judge would have acted on two conclusions favourable to Health World. The first was that Health World had made out the ground for removal of "HEALTHPLUS" under s 59(a) of the Act, namely that at 7 May 2001 Shin-Sun did not intend to use or authorise the use of the mark in Australia. The second was that Health World had made out the ground for in relation to those goods and/or services at any time before the period of one month ending on the day on which the non-use application is filed; that the trade mark has remained registered for a continuous period of 3 years ending one month before the day on which the non-use application is filed, and, at no time during that period, the person who was then the registered owner: used the trade mark in Australia; or used the trade mark in good faith in Australia; in relation to the goods and/or services to which the application relates." In October 2006, after these proceedings were commenced, the requirement in s 92(1) that the applicant be "aggrieved" was dropped. Bell removal of "HEALTHPLUS" under s 88(2)(c) in that Shin-Sun had allowed "HEALTHPLUS" to become deceptive or to cause confusion as at the date of the application for rectification, because the mark was used to identify the relevant goods as goods of Nature's Hive, not those of Shin-Sun. The primary judge would have rectified the Register on those grounds. The result of the second proceeding. The primary judge dismissed the second proceeding on the ground that Health World was not a "person aggrieved" under s 92(1) of the Act. Had he not done so, the primary judge would have acted on the conclusion that it was Nature's Hive, not Shin-Sun, which had used "HEALTHPLUS" during the relevant three year period described in s 92(4)(b), and would have removed the trade mark from the Register. The result of the third proceeding. The primary judge dismissed the third proceeding. He found that Shin-Sun's reliance on s 92(4)(b) was made out because Health World had only used the "INNER HEALTH PLUS" mark on probiotic products. He would have made the orders sought by Shin-Sun, but for his conclusion that it was not a person aggrieved. Shin-Sun has not appealed. The third proceeding thus has no further significance in the case. But it does highlight the curious character of the Full Court's conclusion, where there are two rival traders who have lost no opportunity to attack each other's attempts to register trade marks both before the Registrar and in four sets of court proceedings which have so far been heard by 10 judges, that neither of them is aggrieved, and each is to be regarded as falling within a class of inter-meddlers, lacking any interest to be protected. The structure of the appeals to the Full Court. Health World appealed against the primary judge's dismissal of the first two proceedings by contesting his conclusion that it lacked standing. But it did not challenge his conclusion that the marks are not deceptively similar and his consequent rejection of its arguments that the mark should be revoked on the grounds of deceptive similarity. Shin-Sun filed notices of cross-appeal which were treated as notices of contention challenging the primary judge's conclusions in relation to ss 59 and 88(2)(c) in the first proceeding and s 92(4)(b) in the second. The outcome of the appeals to the Full Court. The Full Court agreed with the primary judge's conclusions that Health World was not a person aggrieved in either of the first two proceedings. It therefore dismissed the appeals without having to determine the issues raised by the notices of contention. Shin-Sun has protected itself by filing notices of contention in this Court in relation to those issues. Bell General considerations Before examining the respects in which it is necessary to depart from the Full Court's reasoning, it is desirable to start with some general principles. First, the meaning of a general expression like "aggrieved" will depend on an examination of the language of the particular statute in which it appears. That examination will reveal the subject, scope and purpose of the statute, and the meaning of "aggrieved" may vary as the subject, scope and purpose varies8. Secondly, the legislative scheme reveals a concern with the condition of the Register of Trade Marks. It is a concern that it have "integrity"9 and that it be "pure"10. It is a "public mischief" if the Register is not pure11, for there is "public interest in [its] purity"12. The concern and the public interest, viewed from the angle of consumers, is to ensure that the Register is maintained as an accurate record of marks which perform their statutory function – to indicate the trade origins of the goods to which it is intended that they be applied13. This concern and this interest are reflected in the following scheme. If an application is made to have a mark registered which does not meet the criteria for 8 Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 174 [15]; [2001] HCA 58. Correctly, it was not submitted that the construction of "aggrieved" in the Act is affected by any differences between it and other legislation going back to the Trade Marks Registration Act 1875 (Imp). 9 Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45 at 65 [40] per Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ; [2000] HCA 12. 10 Attorney-General for New South Wales v Brewery Employés Union of New South Wales (1908) 6 CLR 469 at 595 per Higgins J; [1908] HCA 94. 11 Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 at 10 per Lord 12 Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (1986) 13 FCR 124 at 131 per Gummow J. 13 Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45 at 65 [42] per Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ. Bell registration, there are two opportunities for registration to be prevented. And if a mark has been registered which does not meet the criteria for remaining on the Register, a further opportunity exists to have the Registrar adjust it. The first opportunity arises when an application is lodged. Section 31 of the Act creates a duty on the Registrar to examine and report on whether the application has been made in accordance with the Act, and whether there are grounds under Pt 4 Div 2 for rejecting it14. The Registrar must accept the application unless satisfied that the application has not been made in accordance with the Act, or there are grounds for rejecting it (s 33). Even if the application is accepted, a second opportunity arises. Section 34 creates a duty on the Registrar to advertise the decision to accept the application in the Official Journal of Trade Marks. This enables those who wish to oppose registration to do so pursuant to s 52 of the Act. Section 52 has no standing requirement. If opposition proceedings are not brought, or if they fail, the trade mark is registered (s 68). However, a third opportunity to ensure the purity of the Register arises, for recourse can be had to s 88 or s 92. Those sections require applicants under them to be "aggrieved". It is not the case that any applicant who wants the Register rectified or a mark removed is "aggrieved" merely by reason of that desire: the word has a filtering function. But against that legislative background, it is not clear why the word should be construed restrictively rather than liberally. While the Act offers these facilities for ensuring that the Register is pure in the sense that no mark is to be registered unless valid, and no registration of a mark is to continue if it is not valid, the purpose of ensuring purity exists alongside another purpose. That is the purpose of preventing the security of the Register from being eroded by applications for rectification or removal by busybodies or "common informers or strangers proceeding wantonly"15 or persons without any interest in the Register or the functions it serves beyond 14 Following amendments in 2006, s 31 now relevantly provides that the Registrar is to examine whether there are grounds under the Act for rejecting an application. 15 Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 at 14 per Lord Ashbourne. Bell gratifying an intellectual concern or reflecting "merely sentimental motives"16. Applications of that kind, by clogging up and causing delay in the courts, would cause an unnecessary cloud to hang over registrations. The purpose of avoiding this outcome is reflected in the standing requirements in ss 88 and 92. Applications by persons who are not aggrieved are positively inimical to the fulfilment of the statutory purposes through the Register. the Despite importance of preventing applications of that kind, Lord Herschell LC pointed out that the presence on the Register of a mark which should not be on it may affect "many persons … who nevertheless would not be willing to enter upon the risks and expense of litigation."17 A wider, rather than a narrower, meaning for "aggrieved" ensures that more people are available to procure the removal of a "public mischief" than those reluctant persons to whom Lord Herschell LC referred. In argument there was some debate about why, while there is a standing requirement for applications to rectify the Register or remove a trade mark from it, s 52(1) creates no standing requirement in relation to opposition proceedings before the grant of a trade mark. Health World submitted that the difference was to be explained by the fact that the only persons likely to bring opposition proceedings are persons assisted by professional advisers whose business it is to keep a close watch on advertisements of acceptance in the Official Journal of Trade Marks; that that is the only means by which members of the public are likely to hear that a trade mark application has been accepted; and that persons of that kind are unlikely to be busybodies. The submission may be correct. A further consideration is that, while there is something to be said for permitting anyone in the world to initiate opposition proceedings before registration, at a time when the Registrar may be relatively ignorant and in need of all the assistance that can be obtained, and when no property right in the form of a registered trade mark has yet been granted, those considerations do not apply once it has been granted. Once it has been granted, the proprietor of the mark and others, including licensees and assignees, are likely to have relied on the grant of registration made after solemn processes have been pursued by a Registrar who is probably better informed than at the time of advertisement. The legislation accommodates the interests of traders "in protecting their goodwill 16 In re Apollinaris Company's Trade-marks [1891] 2 Ch 186 at 225 per Fry LJ. See also Farley (Aust) Pty Ltd v J R Alexander & Sons (Q) Pty Ltd (1946) 75 CLR 487 at 491 per Williams J; [1946] HCA 29. 17 Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 at 10. Bell through the creation of a statutory species of property protected by the action against infringement, and in turning this property to valuable account by licensing or assignment."18 The statutory requirement appears to reflect the desirability, once registration of a mark has been granted, of preserving stability in the grant and preventing doubts about its validity from arising unless they are raised by someone who has an interest in doing so. Someone with that interest is likely to sharpen controversy in a fashion which advances the public interest in the purity of the Register. It is for these reasons that the authorities call for the word "aggrieved" in the trade mark legislation to be "liberally construed"19. The legislation has not defined "aggrieved" in ss 88 and 92, and many courts have eschewed any attempt to do so. Rather they have proceeded to deal with the particular problem before them, leaving it to later courts to deal with different problems in the light of their own peculiar circumstances. It is desirable to employ that technique in this case as well. The Full Court's reasoning Shin-Sun submitted that its trade mark had been held not to be deceptively similar to Health World's. It said that Health World could not be an aggrieved person where it was not impeded in its ownership and use of its trade mark by the registration of the Shin-Sun trade mark, where the evidence was inconsistent with any intention on its part to use Shin-Sun's trade mark and where there was no potential for "reputational interference". Shin-Sun supported the orders under appeal by defending the reasoning of the Full Court against various attacks which Health World made on it. 18 Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45 at 65 [42] per Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ. 19 "Daiquiri Rum" Trade Mark [1969] RPC 600 at 620 per Lord Wilberforce. See also Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 at 10 per Lord Herschell LC ("I should be very unwilling unduly to limit the construction to be placed upon these words") and at 14 per Lord Ashbourne ("I do not see any reasons of public policy rendering it at all desirable to unduly narrow the definition of this class of 'persons aggrieved'"); Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (1986) 13 FCR 124 at 131. Bell The key part of the Full Court's reasoning can be summarised as follows20: The Full Court of the Federal Court in Kraft's case21 held that McLelland J in Ritz Hotel Ltd v Charles of the Ritz Ltd22 ("the Ritz Hotel case") adopted a particular exhaustive test for ascertaining whether an applicant is "aggrieved". (b) One aspect of the test in question was that a person claiming to be aggrieved "must demonstrate, to use the language of McLelland J, at least a reasonable possibility of being 'appreciably disadvantaged in a legal or practical sense' by the trade mark remaining on the Register."23 In using the word "must", the Full Court in Kraft's case was attributing to McLelland J, and adopting, an exhaustive test. The Full Court in the present case described the test as the "general test" laid down by McLelland J24. (c) Another aspect of the test was said to be: "A trader who has dealt in the same class of goods as the registered proprietor and shows that he or she could use the mark, establishes a prima facie case that he or she is a person aggrieved for the purposes of a removal application. The inference may be rebutted by evidence from the objector, demonstrating that the applicant would not take advantage of the opportunity to use the mark, but in the absence of such evidence the prima facie inference remains."25 20 Health World Ltd v Shin-Sun Australia Pty Ltd (2009) 174 FCR 218 at 225 [23], [24] and [26] and 227 [32]-[34]. 21 (1996) 65 FCR 104 at 112-113. 22 (1988) 15 NSWLR 158 at 193. 23 Kraft Foods Inc v Gaines Pet Foods Corporation (1996) 65 FCR 104 at 113 per Sackville J (with whom Sheppard and Tamberlin JJ agreed) (emphasis added). The quotation is from Ritz Hotel Ltd v Charles of the Ritz Ltd (1988) 15 NSWLR 158 at 24 Health World Ltd v Shin-Sun Australia Pty Ltd (2009) 174 FCR 218 at 225 [23]. 25 Kraft Foods Inc v Gaines Pet Foods Corporation (1996) 65 FCR 104 at 113. The Full Court in the present case stated that the test had been assented to not only in (Footnote continues on next page) Bell The primary judge had found that the evidence before him was inconsistent with any the "HEALTHPLUS" mark other than as part of its existing "INNER HEALTH PLUS" mark. Hence the "prima facie rule" was rebutted, and Health World was not a person aggrieved. intention of Health World to use Errors in the Full Court's reasoning The errors in this reasoning lie in steps (a)-(c). Health World correctly submitted that the errors stem from the Full Court's adoption of the erroneous conclusion in Kraft's case that McLelland J in the Ritz Hotel case was stating an exhaustive test. With respect, the Full Court should not have followed its predecessor in Kraft's case, for that case was plainly wrong. McLelland J did not state any exhaustive test. Powell's case. The source of the error in Kraft's case may have been in the way it quoted from and emphasised certain aspects of the reasoning in Powell v The Birmingham Vinegar Brewery Co Ltd26 ("Powell's case"). One passage quoted from Powell's case in Kraft's case27 was Lord Herschell LC's statement: "I should be very unwilling unduly to limit the construction to be placed upon [the words 'person aggrieved'], because, although they were no doubt inserted to prevent officious interference by those who had no interest at all in the register being correct and to exclude a mere common informer, it is undoubtedly of public interest that they should not be unduly limited, inasmuch as it is a public mischief that there should remain upon the register a mark which ought not to be there, and by which many persons may be affected who nevertheless would not be willing to enter upon the risks and expense of litigation. Wherever it can be shewn, as here, that the applicant is in the same trade as the person who has registered the trade- Kraft's case but also in Campomar Sociedad Limitada v Nike International Ltd (1998) 85 FCR 331 at 363. That is not so. In that case the Full Court did not say anywhere that McLelland J's test was "general" or exhaustive. In that case the parties claiming to be "aggrieved" tendered evidence which satisfied even a narrow version of that test, and hence no inquiry into the outer reaches of what "aggrieved" meant was called for. 26 [1894] AC 8 at 10. 27 (1996) 65 FCR 104 at 112. Bell mark, and wherever the trade-mark if remaining on the register would or might limit the legal rights of the applicant so that by reason of the existence of the entry upon the register he could not lawfully do that which but for the appearance of the mark upon the register he could lawfully do, it appears to me that he has a locus standi to be heard as a 'person aggrieved'." It is desirable to add the next sentence, which was not quoted in Kraft's case: "In the present case I do not think it can be doubted that the rights of any person who was in the trade and who might desire to make use of the words 'Yorkshire Relish' would be less if this mark were upon the register than they would be if he were only subject to the common law liability of being restrained from making any attempt to pass off his goods as the goods of another person." Another passage quoted in Kraft's case, part of which was there emphasised as indicated below, was Lord Watson's statement28: "In my opinion, any trader is, in the sense of the statute, 'aggrieved' whenever the registration of a particular trade-mark operates in restraint of what would otherwise have been his legal rights. Whatever benefit is gained by registration must entail a corresponding disadvantage upon a trader who might possibly have had occasion to use the mark in the course of his business. It is implied, of course, that the person aggrieved must manufacture or deal in the same class of goods to which the registered mark applies, and that there shall be a reasonable possibility of his finding occasion to use it. But the fact that the trader deals in the same class of goods and could use it, is prima facie sufficient evidence of his being aggrieved, which can only be displaced by the person who registered the mark, upon whom the onus lies, shewing that there is no reasonable probability that the objector would have used it, although he were free to do so." Two other statements may be noted, although they were not quoted in Kraft's case. Lord Ashbourne said29: 28 [1894] AC 8 at 12, cited in Kraft Foods Inc v Gaines Pet Foods Corporation (1996) 65 FCR 104 at 112. 29 [1894] AC 8 at 14. Bell "In the present case, if free, the respondents might wish to deal in a similar article, and the existence of this mark might hamper and impede them in considering how they would develop and work their business." "It appears to me that where a person is engaged in the same trade as the trader claiming the exclusive right to a registered trade-mark consisting, as here, merely of words describing or designating the article manufactured, and where in the development of his business he may find it advantageous to use the words claimed, he is within the meaning of the statute a 'person aggrieved'." Three points must be made about Powell's case. The first point is that none of the express language used suggests that any test stated is exhaustive. The second point is that nothing in the case supported by implication the suggestion that any test stated was exhaustive. In particular, the passage in Kraft's case which the Full Court in this case quoted and relied on to support the "prima facie rule" which Health World failed to satisfy is not derivable from any exhaustive test in Powell's case31. In Powell's case in the Court of Appeal Lindley LJ said that though there was no evidence that the respondents "really will or do intend to make Yorkshire Relish", it "may well be that if they can get rid of this mark they will sell [it]."32 He and the other members of the Court of Appeal concluded that the respondents were therefore "persons aggrieved". The appellant contended to the House of Lords that to be a person aggrieved "the rival trader must actually at the time have an intention or desire to trade in the article in question; that at any rate there must be a reasonable probability of such an intention or desire at some future time"33. Lord Watson accepted that submission, and cited two cases for it which counsel had cited34. Despite the 30 [1894] AC 8 at 15. 31 See above at [33](c). 32 In re Powell's Trade-mark [1893] 2 Ch 388 at 400. 33 Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 at 9. 34 In re Rivière's Trade-mark (1884) 26 Ch D 48 at 54; In re Apollinaris Company's Trade-marks [1891] 2 Ch 186 at 224-225. Bell Court of Appeal's statement that there was no evidence that the respondents wished or intended to sell Yorkshire Relish, both the Court of Appeal and the House of Lords held that the respondents were persons aggrieved. Hence a possibility of use of the mark unsupported by evidence suffices, even where there is no evidence of an actual desire or intention on the applicant's part to use the mark. That is, even an absence of actual desire or intention to use the mark does not exclude the reasonable possibility or probability to which Lord Watson referred. Reliance by the Full Court in the present case on the primary judge's finding that Health World did not intend to use the mark without considering any reasonable possibility or probability unsupported by evidence is inconsistent with the reasoning in Powell's case as it applied to the facts. Thirdly, McLelland J's test, which the Full Court in this case took from Kraft's case, and which it said Health World failed to satisfy35, is explicitly stated by Lord Herschell LC in Powell's case not to be exhaustive. The only support that test might find in Lord Herschell LC's speech is in the last sentence quoted from it above – particularly the words "who might desire to make use"36. But the second-last sentence quoted from Lord Herschell LC's speech makes it clear that the test is not exhaustive, for in that sentence Lord Herschell LC stated a different test – not a test turning on whether the applicant "might desire" to use the trade mark, but a test turning on whether the trade mark "would or might limit the legal rights of the applicant", whatever future course of conduct the applicant actually had in mind or was likely to embark on. In short, as Lord Pearce said in "Daiquiri Rum" Trade Mark37 of Lord "Lord Herschell was not there purporting to do more, I think, than decide that the applicants were within the ambit of the words ['person aggrieved']." The Ritz Hotel case. The next question is whether McLelland J in the Ritz Hotel case38 stated any exhaustive test. Although in Kraft's case there is an 35 See above at [33]. 36 See above at [35]. 37 [1969] RPC 600 at 615. 38 (1988) 15 NSWLR 158 at 193-194. Bell explicit statement, quoted above, that he did39, that is not so. McLelland J was considering the meaning of "person aggrieved" in ss 22(1) and 23(1) of the Trade Marks Act 1955 (Cth). Section 22(1) broadly corresponded with s 88(1) and s 23(1) with s 92(1). Before enunciating the supposedly exhaustive test, "Decisions of high authority appear to me to establish that the expression has no special or technical meaning and is to be liberally construed41. It is sufficient for present purposes to hold that the expression would embrace any person having a real interest in having the Register rectified, or the trade mark removed in respect of any goods, as the case may be, in the manner claimed, and thus would include any person who would be, or in respect of whom there is a reasonable possibility of his being, appreciably disadvantaged in a legal or practical sense by the Register remaining unrectified, or by the trade mark remaining unremoved in respect of any goods, as the case may be, in the manner claimed." (emphasis added) The emphasised words indicate that McLelland J, like Lord Herschell LC and the other members of the House of Lords, was deciding not what the legislation necessitated but what was sufficient to determine the precise issue presented for decision; they were not offering a complete account of what the legislation meant. McLelland J was deciding that Ritz Hotel Ltd, which was claiming to be aggrieved by Charles of the Ritz Ltd's trade mark registrations "CHARLES OF THE RITZ" and "RITZ", was an aggrieved person. Thus McLelland J was not laying down a "general" or exhaustive test. Instead he was enunciating a proposition "sufficient for present purposes", namely deciding the particular controversy before him. He was not marking the outer boundary of the words "aggrieved person". 39 See [33] above. 40 Ritz Hotel Ltd v Charles of the Ritz Ltd (1988) 15 NSWLR 158 at 193. The bulk of this passage was quoted in Kraft's case, and said to be "helpful": (1996) 65 FCR 41 Attorney-General for New South Wales v Brewery Employés Union of New South Wales (1908) 6 CLR 469; Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 and "Daiquiri Rum" Trade Mark [1969] RPC 600; Robert Crean & Co Ltd v Dobbs & Co [1930] SCR 307. Bell It follows that so far as the Full Court in Kraft's case held that the test which it found Health World to have failed was an exhaustive test, Kraft's case should be overruled. The "Daiquiri Rum" case. In "Daiquiri Rum" Trade Mark, after the passage quoted above42, Lord Pearce said43: "In my opinion, the words ['person aggrieved'] were intended by the Act to cover all trade rivals over whom an advantage was gained by a trader who was getting the benefit of a registered trade mark to which he was not entitled. At common law a trader could ask the courts to protect him from the improper use of his mark by others who would pass off their goods as his. But to do this he had to establish by cogent evidence from the purchasing public and the trade that the mark had come to denote his goods and his alone. To avoid the paraphernalia of proof and to help traders by enabling them to see more clearly where they stood in respect of particular marks the Trade Marks Acts were passed. It is, and was intended to be, a great advantage to a trader to have his mark registered under the Acts. That advantage to him is to some extent a corresponding disadvantage to his rivals. He was only intended to have it if the necessary qualifications are fulfilled. If they are not, the mark is not to be entered on the register. If it subsequently appears that it is wrongly on the register, it is to be removed. For to permit it to remain would give him, at the expense of his rivals, an advantage to which he is not entitled. Thus, the general intention and policy of the Act show, I think, that Parliament intended the words to have a wide meaning. If an erroneous entry gives to his rival a statutory trade advantage which he was not intended to have, any trader whose business is, or will probably be, affected thereby is 'aggrieved' and entitled to ask that the error should be corrected." Lord Pearce stipulates no requirement that the applicant desires or intends to use or "could use"44 the mark. Lord Pearce did not say that a relevant question was whether "the applicant would not take advantage of the opportunity to use the 42 See [40]. 43 [1969] RPC 600 at 615. 44 Kraft Foods Inc v Gaines Pet Foods Corporation (1996) 65 FCR 104 at 113. Bell mark"45, or whether there was "no reasonable probability" of use46. For him it sufficed that a wrongly registered mark gave its proprietor an advantage to which the proprietor had no entitlement at the expense of rivals. All that mattered was that they were rivals in relation to the goods to which the mark applied. It did not matter whether or not they intended to use the mark on those goods. "Daiquiri Rum" Trade Mark was cited in the court below47, and Health World relied on Lord Pearce's test in this Court in the course of written and oral argument. Shin-Sun submitted that Lord Pearce's test was not a necessary step in the conclusion reached by the House of Lords. It submitted that the mark which the applicant desired to expunge was "DAIQUIRI RUM", registered in the face of an established meaning for "Daiquiri" as a Daiquiri cocktail. It submitted that the House of Lords considered that this prior meaning of "Daiquiri" as meaning a Daiquiri cocktail would be likely to hamper or impede the applicant, because whilst it might not wish to call its product Daiquiri Rum in the face of a registration for "DAIQUIRI RUM", it might find that purchasers would buy Daiquiri Rum, rather than its rum, for use in Daiquiri cocktails. Even if that was the House of Lords's reasoning, and even if Lord Pearce's test was not a necessary step in its conclusion, which are questions which need not be decided, the submission does not demonstrate that Lord Pearce's test was incorrect, or inapplicable to the facts of the present appeals. Shin-Sun cited an old case inconsistent with Lord Pearce's test, In the Matter of the Trade Mark No 70,078 of Wright, Crossley & Co48, but did not otherwise submit that Lord Pearce's test was incorrect, nor why. So far as that case is inconsistent with Lord Pearce's test, it must be regarded as erroneous, for Lord Pearce's test is sound in principle, given the importance of construing "aggrieved" liberally. Shin-Sun submitted that the test required the applicant to establish a reasonable possibility that the trade mark proprietor in maintaining registration was having an adverse impact on the applicant. The test does not require that, beyond proof of trade rivalry. With respect, then, Lord Pearce correctly stated one test, among others, for ascertaining whether a person is "aggrieved". It is satisfied here, for Health World and Shin-Sun are rivals in selling the health products in question. 45 Kraft Foods Inc v Gaines Pet Foods Corporation (1996) 65 FCR 104 at 113. 46 Powell v The Birmingham Vinegar Brewery Co Ltd [1894] AC 8 at 12. 47 Health World Ltd v Shin-Sun Australia Pty Ltd (2009) 174 FCR 218 at 227 [32]. 48 (1898) 15 RPC 131; aff'd (1898) 15 RPC 377. Bell They are in the same trade, and they each trade in the class of goods in respect of which the challenged mark is registered. Other arguments of Health World Health World propounded many other arguments in support of its claim to be "aggrieved". These were devised against the possibility that the reasoning in Kraft's case were held correct. It is not necessary to deal with them or Shin-Sun's detailed responses to them: the reasoning in Kraft's case is not correct, and the conclusion that Health World is aggrieved can be supported without recourse to those other arguments. Orders The appeals to this Court succeed. Hence the issues arising on Shin-Sun's notices of contention in this Court, which were not dealt with by the Full Court, will have to be determined. The parties have agreed that they should be referred back to the Full Court. That order should be made in each appeal. Shin-Sun submitted that it should not have to pay the costs of the appeals. The grounds it assigned were that it was a small family company and that Health World suffered no legal or practical disadvantage by the registration of Shin- Sun's mark. These are not sufficient grounds for departing from the usual order, particularly in a case where the issue on which Health World succeeded assists in the possible eradication of a public mischief. The orders set out below do not deal with the costs of proceedings before the primary judge. Those costs should be dealt with by the Full Court of the Federal Court in the light of the further hearing. If Shin-Sun were successful at the further hearing, it would be open to the Full Federal Court to leave the primary judge's costs orders undisturbed. If Health World is successful, it would be open to the Full Federal Court to change the primary judge's costs orders. In either event the circumstances relevant to a discretionary decision about those costs orders are best assessed at that future time. In S199 of 2009, the following orders are made: The appeal be allowed. The orders made by the Full Court of the Federal Court of Australia on 17 February 2009 in Federal Court proceeding NSD 394 of 2008 be set aside. Bell The proceeding be remitted to the Full Court of the Federal Court of Australia for determination of the remaining issues. The respondent to pay the appellant's costs of the appeal. The respondent to pay the appellant's costs of the appeal in Federal Court proceeding NSD 394 of 2008. In S200 of 2009, the following orders are made: The appeal be allowed. The orders made by the Full Court of the Federal Court of Australia on 17 February 2009 in Federal Court proceeding NSD 395 of 2008 be set aside. The proceeding be remitted to the Full Court of the Federal Court of Australia for determination of the remaining issues. The respondent to pay the appellant's costs of the appeal. The respondent to pay the appellant's costs of the appeal in Federal Court proceeding NSD 395 of 2008. Crennan CRENNAN J. The facts and issues in these two appeals from the decision of the Full Court of the Federal Court of Australia (Emmett, Besanko and Perram JJ) are set out in the joint judgment of French CJ, Gummow, Heydon and Bell JJ and need not be repeated here. I agree with their Honours that the requirement that certain applications be filed by "a person aggrieved", as provided for in s 88(1) and s 92(1) (as it then stood)49 of the Trade Marks Act 1995 (Cth) ("the Act"), has a filtering function50. I agree with their Honours that the relevant authorities call for the word "aggrieved" to be construed liberally51. I agree with their Honours that consideration of the relevant authorities shows that no court considering the meaning of "aggrieved" in the context of trade mark law has purported to state an exhaustive test in respect of that issue52. I also agree with the orders proposed by their Honours. There is, however, a difference of opinion between their Honours and myself about the test enunciated by Lord Pearce in "Daiquiri Rum" Trade Mark53 ("Daiquiri Rum"). By reference to that test, their Honours state that what is required to be "a person aggrieved" is that an applicant for removal is a trade rival in relation to the goods to which the mark is applied54. Before setting out his test in the Daiquiri Rum case, Lord Pearce approved what was said by Lord Herschell LC in the "Yorkshire Relish" case, Powell v The Birmingham Vinegar Brewery Co Ltd55: 49 Since 23 October 2006 applications to remove a trade mark for non-use can be filed by "a person", and the threshold of "a person aggrieved" need not be met: see Trade Marks Amendment Act 2006 (Cth), Sched 1, item 46. 53 [1969] RPC 600 at 615. 55 [1894] AC 8 at 10. Crennan "Wherever it can be shewn, as here, that the applicant is in the same trade as the person who has registered the trade-mark, and wherever the trade-mark if remaining on the register would or might limit the legal rights of the applicant so that by reason of the existence of the entry upon the register he could not lawfully do that which but for the appearance of the mark upon the register he could lawfully do, it appears to me that he has a locus standi to be heard as a 'person aggrieved'." (emphasis added) Lord Pearce then concluded his consideration of the meaning of "aggrieved"56: "If an erroneous entry gives to his rival a statutory trade advantage which he was not intended to have, any trader whose business is, or will probably be, affected thereby is 'aggrieved' and entitled to ask that the error should be corrected." (emphasis added) It can also be noted that in Wright, Crossley & Co's Trade Mark57, it was held to be insufficient for "a person aggrieved" to merely be in the same trade as the registered owner. The potential for, or actuality of, a business being "affected" is an important element in what Lord Pearce said, and is relevant to the filtering function of "aggrieved" mentioned above. Simple examples of "a person aggrieved" include a trade rival entitled to use a mark the same as the mark sought to be removed, because it is their trade mark or because it is a descriptive mark which should be open to use by all. In each of those examples the business of the trade rival is affected by the presence on the Register of the trade mark sought to be removed. The first example involves a proprietary right, the second example does not. Confusion between trade marks affects the businesses of those using them. Health World satisfies Lord Pearce's test set out above. Health World, a trade rival of Shin-Sun's, is asserting a right to conduct its business in goods of the same description as Shin-Sun's goods, under its trade mark "INNER HEALTH PLUS", without having that business affected by a concurrent registration of the trade mark "HEALTHPLUS" for goods of the same description, which registration Health World claims is erroneously on the Register. For that reason, Health World is "a person aggrieved" as required by the applicable sections of the Act. 56 [1969] RPC 600 at 615. 57 (1898) 15 RPC 131 at 132-133. Crennan In my respectful opinion, it is not essential to the resolution of these appeals to decide that it is sufficient for "a person aggrieved" to prove no more than trade rivalry with the registrant of the trade mark sought to be removed.
HIGH COURT OF AUSTRALIA APPELLANT AND RESPONDENT [2004] HCA 30 16 June 2004 ORDER 1. Appeal allowed. 2. Set aside orders 1, 2 and 3 made by the Full Court of the Supreme Court of Western Australia on 7 March 2002 and, in lieu thereof, order that the appeal to that Court be dismissed. 3. Appellant to pay the respondent's costs of the application for special leave to appeal and of the appeal to this Court. On appeal from Supreme Court of Western Australia Representation: G T W Tannin SC with K E McDonald for the appellant (instructed by Crown Solicitor for the State of Western Australia) K J M de Kerloy with K J Levy for the respondent (instructed by Freehills) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Defences – Respondent charged with fishing for rock lobsters in a prohibited area while holding a commercial fishing licence, contrary to a regulation made under statute – Respondent made inquiries at an office of a State Government department and was provided with incomplete information relating to prohibited areas – Respondent believed he had been provided with complete set of relevant regulations and was therefore unaware that fishing in relevant area was prohibited by law – Whether respondent could rely on defence of "mistake of fact" under s 24, Criminal Code (WA) – Whether respondent's honest and reasonable, but mistaken, belief was one of fact or law – Effect of officially induced error of law – Relevance of rules concerning pleading and proof of regulations. Words and phrases – "mistake of fact", "mistake of law", "state of things". Criminal Code (WA), ss 22, 24. Fish Resources Management Act 1994 (WA), s 222. Fish Resources Management Regulations 1995 (WA), reg 34. GLEESON CJ AND KIRBY J. Professor Glanville Williams said that almost the only knowledge of law that many people possess is the knowledge that ignorance of the law is no excuse when a person is charged with an offence1. This does not mean that people are presumed to know the law. Such a presumption would be absurd. Rather, it means that, if a person is alleged to have committed an offence, it is both necessary and sufficient for the prosecution to prove the elements of the offence, and it is irrelevant to the question of guilt that the accused person was not aware that those elements constituted an offence. The reason for the rule that ignorance of the law is no excuse For present purposes, we use the expression "elements of the offence" to embrace matters of exculpation, and without regard to any special consideration as to onus of proof that might exist in relation to particular offences. Ignorance of the legal consequences that flow from the existence of the facts that constitute an offence is ordinarily not a matter of exculpation, although it may be a matter of mitigation, and in some circumstances it may enliven a discretion not to prosecute. In Blackpool Corporation v Locker2, Scott LJ called the rule that ignorance of the law is no excuse "the working hypothesis on which the rule of law rests in British democracy". His Lordship went on to make the point that the corollary of the rule is that information as to the content of the law should be readily accessible to the public. In a society in which many personal, social and commercial activities are closely regulated, and the schemes of regulation are frequently changed, the detail of regulation may be difficult for citizens and their lawyers to keep up with. Courts themselves normally require evidence of regulations as distinct from statutes. One of the reasons that has been given for the common law rule that courts do not take judicial notice of regulations, as they do of statutes, and that a party relying on regulations must prove them in evidence, is that, in the past, in England, there was no official publication that would give ready access to the content of regulations of the kind that existed in relation to statutes3. For purposes of pleading and evidence, unless the statute pursuant to which regulations were made provided that they were to be taken to be part of the statute, and subject to considerations that might arise out of the way particular litigation was conducted, in civil litigation the making and content of regulations 1 Williams, Textbook of Criminal Law, 2nd ed (1983) at 451. [1948] 1 KB 349 at 361. 3 Todd v Anderson (1912) SC (J) 105 at 108 per Lord Salvesen, cited in Ex parte Madsen; Re Hawes [1960] SR (NSW) 550 at 552. Kirby were treated by the common law as facts to be alleged and proved. Proof of the making and the terms of regulations established that they formed part of the law to be applied to the resolution of the case4. The same applied in criminal proceedings. Regulations duly made form part of the law but, subject to any statutory provision to the contrary, in legal proceedings their existence and content must be alleged and proved by the party relying on them. This principle has been held to apply in Western Australia5. The rule that ignorance of the law does not afford an excuse for an act which would otherwise constitute an offence applies in Western Australia by virtue of s 22 of the State's Criminal Code. The respondent contends, however, that the present case is governed, not by s 22, but by s 24, which provides that a person who does an act under an honest and reasonable, but mistaken, belief in the existence of any state of things is not criminally responsible for the act to any greater extent than if the real state of things had been such as he believed to exist. The outcome of the appeal turns upon the operation of ss 22 and 24 in the circumstances of the case. The elements of the subject offence The facts, the relevant legislation and regulations, and the history of the proceedings, are set out in the reasons of Callinan and Heydon JJ. The respondent was charged with a contravention of reg 34 of regulations made under the Fish Resources Management Act 1994 (WA). That regulation prohibited the holder of a commercial fishing licence from fishing for rock lobsters in an area defined in a Table to the regulation and described in the heading to the regulation as the waters surrounding Quobba Point. It is sufficient for present purposes to adopt the description in the heading. The prohibition was expressed in unqualified terms. There were three elements of the offence created by the regulation: being the holder of a commercial fishing licence; fishing for rock lobsters; and doing so in the waters surrounding Quobba Point, as defined. The respondent's conduct satisfied all of those elements. Furthermore, the respondent made no mistake, and had no erroneous belief, about any of those elements, or about any matter relevant to them. He knew he held a commercial fishing licence; he knew he was fishing for rock lobsters; and he knew where he was fishing. What he did not know was that there was a regulation prohibiting 4 Ex parte Madsen; Re Hawes [1960] SR (NSW) 550. 5 Norton v The Queen (2001) 24 WAR 488 at 520-521. See, however, Evidence Act 1995 (Cth) ss 5, 143. Kirby his conduct. He was fishing where he intended to fish; he did not know there was a law against it. The respondent's explanation of his lack of knowledge of the regulation was not challenged by evidence to the contrary, and was accepted by the magistrate. He contended that this explanation gave him a defence under s 24 of the Criminal Code. The magistrate rejected that contention. In the Full Court of the Supreme Court of Western Australia, an attempt was made to broaden the basis of the respondent's defence by relying upon what was said to be a principle of common law concerning inducement of error by the conduct of public officials. The Full Court refused to allow that issue to be raised because, if it had been raised before the magistrate, the prosecution may have wanted to call evidence from Departmental officers. The prosecution at first instance had been content to argue the s 24 defence on the basis of the respondent's version of what occurred. If the new argument had been raised before the magistrate, the evidence might have taken a different course. It is only the s 24 defence with which this Court is now concerned. There was some debate between counsel as to exactly what was said, and not said, by the officers with whom the respondent dealt, but the points of difference are immaterial. It is the substance of what passed between the respondent and those officers, not the precise language used, that matters. On his evidence, the respondent was seeking to obtain from the Department knowledge as to where it was lawful, and where it was unlawful, for him to fish for rock lobsters. His requests for information must have been so understood, and the information he was given was a response to these requests. The respondent submits, the magistrate found, and the Full Court agreed, that, in substance, the respondent was led to believe that the documentary material he was given contained a complete reference to the places in which commercial rock lobster fishing was prohibited, that it was reasonable of him to have that belief, and that the belief was mistaken. That, it is said, was an honest and reasonable, but mistaken, belief in the existence of a state of things and was covered by s 24. The history and meaning of ss 22 and 24 of the Code Sections 22 and 24 are based on the Queensland Criminal Code, drafted by Sir Samuel Griffith. The corresponding provisions of the Queensland Code were intended to state the common law6. In Thomas v The King7, Dixon J said that ss 22 and 24 "state ... the common law with complete accuracy". 6 He Kaw Teh v The Queen (1985) 157 CLR 523 at 572-573. (1937) 59 CLR 279 at 305-306. Kirby The common law applicable to a case such as the present was stated by Jordan CJ in R v Turnbull8, in a passage quoted by Brennan J in He Kaw Teh v The Queen9, as follows: "... it is also necessary at common law for the prosecution to prove that [the accused] knew that he was doing the criminal act which is charged against him, that is, that he knew that all the facts constituting the ingredients necessary to make the act criminal were involved in what he was doing. If this be established, it is no defence that he did not know that the act which he was consciously doing was forbidden by law. Ignorance of the law is no excuse. But it is a good defence if he displaces the evidence relied upon as establishing his knowledge of the presence of some essential factual ingredient of the crime charged." (emphasis added) What Jordan CJ referred to as "the ingredients necessary to make the act criminal" are what we have earlier called the elements of the offence. Sections 22 and 24 must be read together. The reference in s 24 to a belief in the existence of a state of things must be, and can be, understood in the light of s 22, and of the common law principle reflected in ss 22 and 24. In a case such as the present, the key to such understanding is in Jordan CJ's reference to "the facts constituting the ingredients necessary to make the act criminal". Section 24 is not concerned with mistakes at large. In particular, it is not concerned with mistakes about whether there is a law against conduct of a certain kind. Section 24 requires that attention be directed to the elements of the offence charged, and to the facts relevant to those elements, understood in the wider sense explained at the commencement of these reasons. It requires identification of the act or acts alleged to constitute the offence, and consideration of the extent to which the accused would have been criminally responsible for such act or acts "if the real state of things had been such as he believed to exist". Section 24 applies to mistakes about the elements of the offence, not mistakes about the existence of the law creating the offence. The nature of the mistake The respondent, seeking to characterise his mistake as one of fact rather than law, says that his mistaken belief as to a state of things was a belief that he had been given, by the officers of the Department, complete information as to the regulatory prohibitions on commercial rock lobster fishing so far as they affected (1943) 44 SR (NSW) 108 at 109. (1985) 157 CLR 523 at 572. Kirby his proposed activities. Let it be accepted that this was so. The information provided to the respondent was not an element of the offence created by reg 34, any more than the respondent's state of mind concerning the existence of the prohibition is an element of the offence. The three elements of the offence are stated above. The respondent had no mistaken belief about any of them. The reference in s 24 to "the real state of things" is a reference to the state of things relating to the elements of the offence in question, not to the state of things as to whether the offence exists, or whether the conduct constituted by those elements is an offence. An example of the application of s 24 may have arisen if, as a result of navigational error, the respondent had been under an honest and reasonable, but mistaken, belief as to his location. In that event, it may have been that, if the real state of things had been as he believed, his conduct would not have contravened reg 34, and thus he would have had a defence under s 24. The only mistake that the respondent made was a mistake that resulted from his ignorance of the law. The acts of the respondent would have constituted a breach of reg 34 even if he had been given complete and accurate information by the Department. What the respondent's argument amounts to is that, in that event, he would not have done the acts. That is not the issue raised by s 24. It is beside the point. The magistrate, and the dissenting member of the Full Court, were right to hold that the case fell within s 22 of the Criminal Code, and not This is not a case that gives rise to the difficulties that are sometimes involved in distinguishing between mistakes of law and mistakes of fact, or in applying the common law, or ss 22 and 24, to what are sometimes described as mixed questions of fact and law10. Here the mistake that was made, however it is characterised, was not relevant to any element of the offence charged. Rather, it was a mistake that resulted in ignorance of the existence of the prohibition contained in reg 34, that is to say, ignorance of the law. Conclusion The appeal should be allowed. We agree with the consequential orders proposed by Callinan and Heydon JJ. 10 Strathfield Municipal Council v Elvy (1992) 25 NSWLR 745 at 751; Von Lieven v Stewart (1990) 21 NSWLR 52 at 66-67. McHugh 15 McHUGH J. The issue in this appeal is whether the respondent, Mr Jeffrey Ryder Palmer, was entitled to rely on a defence of mistake of fact under s 24 of the Criminal Code (WA) to a charge of fishing for rock lobster in a prohibited area. Mr Palmer believed that the area was not so prohibited. His belief was induced by the conduct of an employee of Fisheries Western Australia ("Fisheries WA"), a State Government department. When he requested a copy of the relevant regulations which identified the areas where fishing for rock lobster was prohibited, the Fisheries WA employee gave Mr Palmer documents that did not identify the area proposed to be fished as one where fishing for rock lobster was prohibited. Section 24 declares that a person who does an act under an honest and reasonable, but mistaken, belief in the existence of any "state of things" is not criminally responsible for the act to any greater extent than if the real "state of things" had existed. In my opinion, Mr Palmer could not rely on the defence of mistake of fact under s 24. His mistake was one of law: he erroneously believed that no law prohibited him from fishing for rock lobster in that area. It is irrelevant that his belief was induced by the conduct of a Fisheries WA employee. Statement of the case On 1 March 2000, in the Court of Petty Sessions of Western Australia at Carnarvon, George Peter Ostrowski, an officer of Fisheries WA, charged Jeffrey Ryder Palmer with an offence under reg 34 of the Fish Resources Management Regulations 1995 (WA) ("the Regulations") and s 222 of the Fish Resources Management Act 1994 (WA) ("the Act"). The material parts of the charge alleged that Mr Palmer: "being the holder of a commercial fishing licence, fished for rock lobster within that portion of the Indian Ocean bounded by a line starting from a point on the high water mark situated at the southwestern-most extremity thence generally of Quobba Point and extending south northwesterly along the high water mark aforesaid to the starting point; contrary to Regulation 34 of the Fish Resources Management Regulations 1995 and Section 222 of the Fish Resources Management Act 1994." ... and The area referred to in the charge was the area described in the Table to reg 34 of the Regulations, being the area where fishing for rock lobster was prohibited. The offence was a strict liability offence. On 2 March 2000, Packington SM rejected a defence of mistake of fact based on s 24 of the Criminal Code and convicted Mr Palmer of the offence. He imposed a general penalty of $500 and a mandatory additional penalty of $27,600, calculated under s 222 of the Act. He also ordered Mr Palmer to pay costs of $2,000. McHugh Subsequently, Miller J in the Supreme Court of Western Australia granted Mr Palmer leave to appeal to the Full Court of the Supreme Court of Western Australia against the decision of Packington SM, and an extension of time in which to do so. In the appeal, Mr Palmer claimed that he was entitled to rely on the defence of mistake of fact in s 24 of the Criminal Code. He contended that he had made reasonable and specific inquiries concerning the regulations applicable in the area where he proposed to fish and, on the basis of the representations he had received, honestly and reasonably believed that the area was not restricted. He contended that this honest and reasonable, but mistaken, belief was a "belief in the existence of any state of things" within the meaning of s 24 of the Code. A majority of the Full Court (Malcolm CJ and Olsson AUJ, Steytler J dissenting) upheld his appeal11. The Court set aside the conviction recorded against him and the penalties imposed upon him, and dismissed the complaint. Subsequently, this Court granted Mr Ostrowski leave to appeal against the orders of the Full Court. The material facts At all material times Mr Palmer was the holder of a commercial fishing licence under the Act. He leased a boat, the subject of a fishing boat licence and a managed fishery licence. These licences, in particular the managed fishery licence, authorised Mr Palmer to fish for western rock lobster by means of a temporary pot entitlement of 87 pots in Zone B of the western rock lobster fishery, an area located off the central coast of Western Australia near Carnarvon. On or about 11 November 1998, Mr Palmer went to the Fremantle office of Fisheries WA and asked for a copy of the current regulations to cover the 1998/1999 fishing season for rock lobster in Zone B. He was told that a copy of the regulations was not available, but that, if he returned on 13 November, a copy would be available. He returned on that day. According to Mr Palmer's evidence, an "office lady" working at the public counter told him that the office still did not have copies of the regulations available for collection by members of the public. She offered to photocopy the copy of the regulations held by the Fremantle office, an offer that Mr Palmer accepted. After photocopying the regulations, the woman gave Mr Palmer a copy of the West Coast Rock Lobster Limited Entry Fishery Notice 1993 and a bundle of notices made variously under the Fisheries Act 1905 (WA) and the Act. None of these documents mentioned reg 34 of the Regulations, which provides: 11 Palmer v Ostrowski (2002) 26 WAR 289. McHugh "Fishing for rock lobster in the waters surrounding Quobba Point A person who is the holder of a commercial fishing licence must not fish for rock lobsters at any time in the area described in the Table to this regulation. Penalty: $5000 and the penalty provided in section 222 of the Act. Table All that portion of the Indian Ocean bounded by a line starting from a point on the high water mark situate at the southwestern-most extremity of Quobba Point and extending south to south latitude 24˚34'; thence east to a point on the high water mark; and thence generally northwesterly along the high water mark aforesaid to the starting point." The woman also told Mr Palmer that, if he wanted more information, to take one of the pamphlets in the public reception area. He took a pamphlet entitled "Fishing for Rock Lobsters" for the 1998/1999 season issued by Fisheries WA, which in fact related largely to recreational rather than commercial fishing. Mr Palmer did not inform any Fisheries WA officer or employee that he held a commercial fishing licence. In his evidence, he said that he assumed that any Fisheries WA officer or employee would deduce this from the fact that he ordered a commercial research log book at the same time as he collected the material from the Fremantle office. Between approximately 7 and 9 February 1999, Mr Palmer placed a number of rock lobster pots near Quobba Point and within the waters described in the Table to reg 34 of the Regulations. He knew the true geographical position of the pots and intended to fish for rock lobster in that area. On about 8 February 1999, he was made aware that officers from Fisheries WA were inspecting his lobster pots. However, Mr Palmer contended that he did not know that fishing for rock lobster was prohibited in this area until, on 10 February, he spoke with officers from Fisheries WA, who had entered the harbour at Carnarvon on a boat carrying his lobster pots. The Criminal Code The critical provision of the Criminal Code is s 24, which provides: "Mistake of fact A person who does or omits to do an act under an honest and reasonable, but mistaken, belief in the existence of any state of things is not criminally responsible for the act or omission to any greater extent than if the real state of things had been such as he believed to exist. McHugh The operation of this rule may be excluded by the express or implied provisions of the law relating to the subject." Section 24 must be read together with s 22, the relevant part of which states: "Ignorance of law, bona fide claim of right Ignorance of the law does not afford any excuse for an act or omission which would otherwise constitute an offence, unless knowledge of the law by an offender is expressly declared to be an element of the offence." Section 36 provides that the provisions of Ch V (which contains ss 22 and 24) "apply to all persons charged with any offence against the statute law of Western Australia." It is not disputed that these provisions apply to the offence in respect of which Mr Palmer was convicted12. Sections 22 and 24 should be construed with reference to the applicable common law principles relating to mistake of fact and mistake of law. In Thomas v The King13, Dixon J noted that ss 22 and 24 (and the equivalent provisions in the other Code States) state "with complete accuracy" the common law principle that a mistaken belief as to a matter of fact is a defence to a criminal or statutory offence, but a mistaken belief as to a matter of law is not a defence to such a charge. Sections 22 and 24 of the Criminal Code are based on provisions of the Criminal Code (Q), which were intended by its drafter, Sir Samuel Griffith, to reflect the common law distinction between a mistake of fact and a mistake of law14. This legislative history, together with the presence in the Criminal Code of s 22 and the heading "Mistake of fact" above s 24, require the phrase "any state of things" to be read as a reference to a matter of fact rather than a matter of law. As Brennan J said in Boughey v The Queen15: "It is erroneous to approach the Code with the presumption that it was intended to do no more than restate the existing law but when the Code 12 Geraldton Fishermen's Co-Operative Ltd v Munro [1963] WAR 129 at 133; Pearce v Stanton [1984] WAR 359 at 362 per Rowland J. 13 (1937) 59 CLR 279 at 305-306. 14 He Kaw Teh v The Queen (1985) 157 CLR 523 at 572-573 per Brennan J. 15 (1986) 161 CLR 10 at 30-31. See also Marwey v The Queen (1977) 138 CLR 630 at 637 per Barwick CJ. McHugh employs words and phrases that are conventionally used to express a general common law principle, it is permissible to interpret the statutory language in the light of decisions expounding the common law ... The meaning of the words and phrases to be found in a Code is controlled by the context in which they are found but when the context does not exclude the common law principles which particular words and phrases impliedly import, reference to those common law principles is both permissible and required." (footnote omitted) Queensland courts have interpreted the phrase "state of things" in s 24 of the Criminal Code (Q) – which for all intents and purposes is identical to s 24 of the Western Australian Criminal Code – as referring to matters of fact only16. Western Australian courts appear to have assumed a similar interpretation17. Mr Palmer contends, however, that s 24 is significantly different from the common law in that the phrase "belief in the existence of any state of things" has a broader operation with respect to mistake than the equivalent common law principle, which applies in relation to a belief "in the existence of a state of facts"18. He submits that the phrase "belief in the existence of any state of things" extends to cover the object of his mistake, which involved an erroneous conclusion about the state of the law, based on two mistakes of fact. In support of his contention that his mistake was covered by the phrase "state of things" in s 24, Mr Palmer relies on a statement by Isaacs and Powers JJ in Duncan v Theodore19 that "'state of things' includes the existence of a law or a valid regulation under a law." That dictum is of no assistance in this case. In Duncan, one of the issues before this Court was whether s 7 of the Sugar Acquisition Act 1915 (Q) – which declared that no action should lie against certain persons for damage sustained by reason of the making of a Proclamation under that Act or by anything done or purporting to be done thereunder – applied 16 Horne v Coyle; Ex parte Coyle [1965] Qd R 528 at 532 per Lucas J, Sheehy ACJ and Douglas J agreeing; Loveday v Ayre and Ayre; Ex parte Ayre and Ayre [1955] St R Qd 264 at 276 per Hanger J; Pusey v Wagner; Ex parte Wagner [1922] St R Qd 181 at 184-185. 17 Roddan (2002) 128 A Crim R 397 at 401 per Murray J, Wallwork and Einfeld JJ agreeing; Illich v Young (2000) 32 MVR 354 at 358 per Roberts-Smith J; Giorgi v Playboy Holdings Pty Ltd (Unreported, Supreme Court of Western Australia, 16 August 1993, White J) at 8-9; Ex parte D (1995) 17 ACSR 52 at 73-74 per 18 Proudman v Dayman (1941) 67 CLR 536 at 541 per Dixon J. 19 (1917) 23 CLR 510 at 536. McHugh to acts done under an invalid Proclamation. The Court had to determine whether the term "anything done or purporting to be done thereunder" protected the seizing of cattle by a police officer under an invalid Proclamation. The owners of the cattle had brought an action for damages against the police officer. Isaacs and Powers JJ, who dissented on this and other issues, held that the section applied to acts done under an invalid Proclamation. Their Honours adopted a statement in Maxwell on the Interpretation of Statutes that, in enactments such as s 7, terms such as "under", "by virtue of" and "in pursuance of" require a belief by the relevant officer "in the existence of such (1) facts, or (2) state of things as would, if really existing, have justified his conduct."20 It was in this context that their Honours said that "'state of things' includes the existence of a law or a valid regulation under a law."21 Isaacs and Powers JJ held that the defendant officer's belief that the Proclamation was valid brought the case within s 7 and that, accordingly, no action lay against him. The majority Justices held to the contrary. The dictum of Isaacs and Powers JJ about the operation of a provision which conferred an immunity on government officials from actions for damages carries no persuasion in the different context of the Criminal Code, even if one ignores the fact that the dictum was expressed in a dissenting judgment. In the Criminal Code, the very different issue is whether the term "state of things" applies to an incorrect belief as to the state of the law (including the existence of a regulation) or its application. Unlike Duncan, the issue is not whether an expression in a protective provision should be given a beneficial interpretation to apply to an otherwise invalid regulation. No doubt s 24 may protect mistaken belief concerning an event or matter which involves a mixed question of fact and law. This is consistent with the suggestion by Dixon J in Thomas that such a mistake should be characterised as one of fact. His Honour said22: 20 Duncan (1917) 23 CLR 510 at 536, citing Maxwell on the Interpretation of Statutes, 5th ed (1912) at 378 (original emphasis). 21 Duncan (1917) 23 CLR 510 at 536. 22 Thomas (1937) 59 CLR 279 at 306. However, in Strathfield Municipal Council v Elvy, Gleeson CJ stated in relation to Dixon J's proposition that mistakes on mixed questions of fact and law will not ordinarily constitute mistakes of fact: (1992) 25 NSWLR 745 at 751, Clarke JA and Lee AJ concurring. McHugh "[I]n the distinction between mistakes of fact and of law, a mistake as to the existence of a compound event consisting of law and fact is in general one of fact and not a mistake of law." Similarly, McPherson JA in Comptroller-General of Customs v Woodlands Enterprises Pty Ltd, after referring to Dixon J's observation in Thomas, said23: "Because it refers to a mistaken belief in the existence of any 'state of things' ... s 24 of the Criminal Code (Qld) is capable of comprehending a mistake about a matter of mixed fact and law". As I later explain, however, no question of a mistake about a matter of mixed fact and law arises in this case. A mistake of fact or of law? The distinction between a mistake of fact and a mistake of law is by no means a simple one24. In Iannella v French, Windeyer J said25: "The distinction which our law makes for its purposes between law and fact, between questions of law and questions of fact, between mistakes of law and mistakes of fact, is thus by no means as easy as might at first be expected. That it is not absolute is illustrated by the many cases said to turn on a mixed question of law and fact. Then there is the choice between two propositions – on the one hand that of Dixon J in this Court in Thomas v The King that 'a mistake as to the existence of a compound event consisting of law and fact is in general one of fact and not a mistake of law' – on the other hand the rule that, when the facts are ascertained it is a question of law whether a thing or place answers a particular description in the statute". (footnote omitted) Mr Ostrowski contends that the operative mistake made by Mr Palmer was that Mr Palmer believed that he was lawfully entitled to fish in a particular area. Mr Ostrowski submits that such a mistake is one of law. On this view, the events which occurred prior to Mr Palmer's placing his lobster pots in the 23 (1995) 83 A Crim R 579 at 585. See also Walden v Hensler (1987) 163 CLR 561 at 592 per Dawson J. 24 David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353 at 374 per Mason CJ, Deane, Toohey, Gaudron and McHugh JJ; Griffin v Marsh (1994) 34 NSWLR 104 at 122 per Smart J; Fitzpatrick v Inland Revenue Commissioners [1994] 1 WLR 306 at 320 per Lord Browne-Wilkinson. 25 (1968) 119 CLR 84 at 114-115. McHugh restricted area – in particular, Mr Palmer's visits to the Fremantle office of Fisheries WA – are irrelevant. Mr Ostrowski contends that a mistake concerning the "state of things" would have occurred if Mr Palmer had been mistaken as to an element of the offence in reg 34. Such a mistake would have occurred, for example, if Mr Palmer believed that he was not fishing for rock lobster or that he was not in the geographical area where he was. No mistake concerning the "state of things" exists, argues Mr Ostrowski, if all that has occurred is that a person believes that he or she is acting lawfully. In response, Mr Palmer contends that the earlier dealings with Fisheries WA are relevant – indeed fundamental – to characterising his mistake. He submits that at all material times he possessed an honest and reasonable, but mistaken, belief that: he had been provided with all relevant regulations concerning the area where he proposed to fish; there was no regulation bearing on the closure by Fisheries WA of the waters in which he proposed to fish or, in short, that reg 34 of the Regulations did not exist; and he was lawfully entitled to fish where he did. Mr Palmer submits that the first two mistakes were of a factual nature and that, although the third matter was a mistaken conclusion of law, it cannot logically be dissociated from the factual events which gave rise to it. On this basis, so Mr Palmer contends, the mistake amounts to a mistake as to the existence of any state of things within the meaning of s 24 of the Criminal Code, and that s 22 does not apply to a mistake of this kind. At common law, and in my opinion under the Criminal Code, once the prosecution proves in relation to a strict liability offence that the defendant knew the facts that constitute the actus reus of the offence, that is, all the facts constituting the ingredients necessary to make the act criminal, the defendant cannot escape criminal responsibility by contending that he or she did not understand the legal consequences of those facts. In R v Turnbull, Jordan CJ, when discussing the common law concept of mens rea, said26: "[I]t is also necessary at common law for the prosecution to prove that he knew that he was doing the criminal act which is charged against him, that is, that he knew that all the facts constituting the ingredients necessary to make the act criminal were involved in what he was doing. If this be 26 (1943) 44 SR (NSW) 108 at 109, Davidson and Street JJ concurring. McHugh established, it is no defence that he did not know that the act which he was consciously doing was forbidden by law. Ignorance of the law is no excuse. But it is a good defence if he displaces the evidence relied upon as establishing his knowledge of the presence of some essential factual ingredient of the crime charged." (emphasis added) This passage was cited with approval by Brennan J in He Kaw Teh v The Queen27. Similarly, in Thomas, Latham CJ said that "[m]istaken belief as to any relevant element of the offence is sufficient to bring the case within the rule in Tolson's Case".28 His Honour summarised the rule in R v Tolson as follows: "[T]he accused is not guilty if he had an honest and reasonable belief in the existence of facts which, if they had really existed, would have made his act both legally and morally innocent."29 In Tolson30, a majority of nine of the 14 Justices of the Queen's Bench Division held that it was a defence to a charge of bigamy that, when the accused married, she had an honest and reasonable belief that her "former husband" was dead. Despite the split nature of the decision in Tolson, the case seems a straightforward application of basic principle. Mrs Tolson believed that she was a single woman because her husband was dead. That was a mistake of fact31. Accordingly, she had an honest and reasonable, but mistaken, belief in the existence of facts which, if they had existed, would have rendered her actions legally innocent. If she had in fact been single, she could not have been guilty of bigamy. The decision of this Court in Thomas32, another bigamy case, also produced a narrow majority in favour of the accused. The majority (Latham CJ, Rich and Dixon JJ, Starke and Evatt JJ dissenting) held that it was a defence to a charge of bigamy that the accused had believed "bona fide and on reasonable 27 (1985) 157 CLR 523 at 572. 28 (1937) 59 CLR 279 at 292, citing R v Tolson (1889) 23 QBD 168. 29 (1937) 59 CLR 279 at 287. 30 (1889) 23 QBD 168. 31 Of course, as Dixon J acknowledged in Thomas, questions of the legal status of a person involve a question of law, but a statement that a person is single is treated as a statement of fact: (1937) 59 CLR 279 at 307. 32 (1937) 59 CLR 279. McHugh grounds"33 that he was not married and therefore a single man entitled to marry. The basis of the belief of the accused was that his marriage to his "former wife" was not valid because her decree of divorce "had not been made absolute, so that she was still a married woman when he married her."34 In upholding the defence of honest and reasonable mistake, Latham CJ said35: "The belief was that a decree absolute had not been made by the Supreme Court of Victoria. Whether or not such a decree had been made was a question of fact. If no decree absolute had been made, the marriage of the accused's former wife would not have been dissolved and therefore, she would still have been a married woman when she married the accused. Thus, her marriage to the accused would have been invalid, and he would not have been a married person when he went through the ceremony of marriage with Miss Deed. Thus, if his belief as to the matter of fact mentioned had been true, he would not have been guilty of the offence charged." In the bigamy cases36, the mistake concerned a belief as to a fact that, if true, meant that the accused was a single person when he or she went through a ceremony of marriage. Such facts included the fact of a husband's death or the absence of a decree absolute. They were not cases where the accused had a simple but erroneous belief that he or she was entitled to marry. In Thomas, "The case would, I agree, have been entirely different if his belief had only been a belief that, for some reason or other which he did not understand, the prior marriage of his wife had not effectually been dissolved. That belief might well be regarded as being a belief with respect to a matter of law, and a mistaken belief upon a question of law could not be a defence to a criminal charge." 33 Thomas (1937) 59 CLR 279 at 285 per Latham CJ. 34 Thomas (1937) 59 CLR 279 at 284 per Latham CJ. 35 Thomas (1937) 59 CLR 279 at 286. 36 Tolson (1889) 23 QBD 168; Thomas (1937) 59 CLR 279. See also R v Wheat [1921] 2 KB 119; R v Adams (1892) 18 VLR 566; and R v Kennedy [1923] SASR 183, where the defence of mistake of fact was rejected. In the light of Thomas, however, Wheat cannot be considered good law in Australia. 37 (1937) 59 CLR 279 at 286. McHugh Thus, it is no defence to a criminal charge that the defendant believed that his or her actions were not regulated by law or that his or her actions satisfied the provisions of a law. Such beliefs are mistakes of law, not mistakes of fact. In Von Lieven v Stewart38, the Court of Appeal of New South Wales held that the belief by a promoter of a scheme operated by a company that the scheme "neither involved an offer to the public nor a prescribed interest"39 and accordingly did not contravene the Companies (New South Wales) Code or the Securities Industry (New South Wales) Code was a mistake of law, not fact. It provided no defence to charges of breaching provisions of those Codes. Clarke JA said that, once the defendant knows all the facts which constitute the elements of the offence, a mistake as to their legal effect is not a defence to a criminal charge40. Handley JA (with whom Mahoney JA agreed) said41: "[A] belief or assumption that the acts in question are lawful either because they are unregulated, or because the requirements of the law have been satisfied, cannot excuse in cases such as this. ... The only excuse is the existence of an actual or positive belief, based on reasonable grounds, in the existence of some fact or facts which, if true, would make the act in question innocent". In Horne v Coyle; Ex parte Coyle42, a truck driver had been convicted of using a vehicle for the carriage of goods without a permit. The driver relied on s 24 of the Criminal Code (Q). He believed that it was lawful for him to obtain verbal permission from an officer of the Transport Department before the goods were carried and to acquire a permit only after the goods had been carried. Lucas J concluded that this was a mistake of law43: "It is, I should think, impossible for s 24 to apply in circumstances in which an accused person merely says 'I admit that I did so-and-so, but I believed that it was lawful and not an offence against the Act in question'." 38 (1990) 21 NSWLR 52. 39 Von Lieven (1990) 21 NSWLR 52 at 55 per Clarke JA. 40 Von Lieven (1990) 21 NSWLR 52 at 55. 41 Von Lieven (1990) 21 NSWLR 52 at 66-67. 42 [1965] Qd R 528. 43 Horne [1965] Qd R 528 at 532-533, Sheehy ACJ and Douglas J agreeing. McHugh The nature of Mr Palmer's mistake Mistake of law Mr Palmer believed that he was legally entitled to fish for rock lobster in the area in which he was fishing. He was operating under this mistaken belief when he committed the offence. His belief was clearly connected to one of the elements constituting the offence, namely, that "[a] person who is the holder of a commercial fishing licence must not fish for rock lobsters at any time in the area described in the Table to this regulation." (emphasis added) Mr Palmer's mistake, however, was one of law, not fact. The statement of Handley JA in Von Lieven, set out above, exactly covers this case. Mr Palmer was the holder of a commercial fishing licence. He fished for rock lobsters in the area described in the Table to reg 34 of the Regulations. He intended to fish for rock lobsters in that area and he knew that he was in that part of the Indian Ocean described in the Table to that regulation. Mr Palmer made no mistake as to any of the factual elements of the charge. His mistake was that he believed that the law of Western Australia did not prohibit or regulate fishing for rock lobsters in that area. His mistaken belief was not a mistake as to a fact or "state of things", but a mistake as to the operation of the law. His case fell within s 22, not s 24, of the Criminal Code. It was ignorance of the law that caused him to make the mistake that he did. Under s 22 of the Criminal Code, ignorance of the law is not an excuse for an act or omission that "would otherwise constitute an offence, unless knowledge of the law by [the] offender is expressly declared to be an element of the offence." The mistake made by Mr Palmer may be contrasted with that made by another Western Australian rock lobster fisherman, Mr Stanton, who successfully relied on s 24 of the Criminal Code as a defence to a charge under the Act of selling undersized rock lobsters44. In Pearce v Stanton45, the s 24 defence succeeded because Mr Stanton was found to have held an honest and reasonable belief that the lobsters were the correct size. Such a belief – as to the actual size of the lobsters – was a belief in the existence of a fact which constituted one of the elements of the strict liability offence. If, by contrast, Mr Stanton had held a mistaken belief as to the minimum size of rock lobster permitted by law, this would have been a mistake of law. The belief in those circumstances would have been based on a misunderstanding of the regulations governing the minimum lobster size. 44 Pearce [1984] WAR 359. 45 [1984] WAR 359. McHugh Mixed fact and law Nor was the mistake made by Mr Palmer a mistake of mixed fact and law of the type described by Dixon J in Thomas, which for the purpose of s 24 may be regarded as a mistake of fact. The earlier mistakes made by Mr Palmer – as to whether he had a complete set of regulations and whether a regulation existed which prohibited fishing in the area – explain how he came to form his mistaken view as to where he could fish. These earlier mistakes are nevertheless preliminary to the commission of the offence. They do not concern the elements of the offence; they cannot change what is a mistake of law, namely, a belief that Mr Palmer was entitled to fish for rock lobster in the area, into one of fact. Earlier mistakes of fact Mr Palmer relies on the suggestion by Smart J in Griffin v Marsh46 that a mistake of law based on an earlier mistaken belief as to a relevant and important fact should be treated as a mistake of fact. Such a general proposition cannot be accepted. It is true, as Smart J noted, that such a principle is more consistent with the principle that the law only punishes those with a guilty mind. However, this is not the determinative principle in this area. The very existence of the strict liability offence in the present case indicates that, to adopt the words of Dixon J in Proudman v Dayman47, the Legislature was also concerned to "cast on the individual the responsibility of so conducting his affairs that the general welfare will not be prejudiced." In other words, an intention to commit the offence is not one of the elements which constitutes that offence; rather, the offence is made out if the prosecution establishes that the defendant knew all the elements constituting the offence. Indeed, the suggestion of Smart J effectively introduces a new rule of law: a mistake of law is a defence to a criminal charge if it was the consequence of a relevant mistake of fact. Such a rule cannot stand with the terms of s 22 of the Criminal Code, particularly in the context of strict liability offences. Erroneous advice It is irrelevant that Mr Palmer's mistake was induced by the conduct of an employee of Fisheries WA. That conduct cannot convert a mistake as to the applicable law into a mistake of fact. If a defendant knows all the relevant facts that constitute the offence and acts on erroneous advice as to the legal effect of those facts, the defendant, like the adviser, has been mistaken as to the law, not the facts. 46 (1994) 34 NSWLR 104 at 118. 47 (1941) 67 CLR 536 at 540. McHugh Four cases which address this issue are Olsen v The Grain Sorghum Marketing Board; Ex parte Olsen48, Loch v Hunter; Ex parte Loch49, Cambridgeshire and Isle of Ely County Council v Rust50 and Power v Huffa51. In the first two cases each defendant claimed that he or she was acting on the erroneous advice of a third party – either a legal adviser or a government official – that the acts in question were legal and that this mistake amounted to a mistake of fact. In the last two cases each defendant claimed that he or she had been given lawful authority to act as charged and that this mistake likewise amounted to a mistake of fact. In each case the defendant's argument failed, the court finding that each defendant was acting under a mistake of law. Accordingly, the bare fact that the adviser or official may have been mistaken as to the state of the law does not convert the defendant's mistake into one of fact. Both the adviser or the official and the defendant operate under a mistake of law. In Olsen52, the defendants relied on s 24 of the Criminal Code (Q) to defend a charge under a Queensland statute of buying grain from a person other than the Grain Sorghum Marketing Board. The defendants, who were grain merchants, had carried grain from Queensland into New South Wales and then back to Queensland in the belief that they were protected by s 92 of the Constitution53. In doing so, the defendants had acted under advice from counsel, an advice which was based on a decision of the Full Court of the Supreme Court of Queensland, which was subsequently reversed by this Court. The Full Court of the Supreme Court of Queensland rejected the defendants' claim that as the result of counsel's advice they were engaged in interstate trade, which involved a question of mixed fact and law. Stable J said that the mistake was clearly one of law54. 48 [1962] Qd R 580. 49 Unreported, Full Court of the Supreme Court of Queensland, 1 May 1957, Stanley, 51 (1976) 14 SASR 337. 52 [1962] Qd R 580. 53 Section 92 provides, inter alia: "On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free." 54 Olsen [1962] Qd R 580 at 592. McHugh A defence under s 24 of the Criminal Code (Q) also failed in Loch55 where the licensee of a hotel was prosecuted under the Liquor Act 1912 (Q) for keeping the hotel open for the sale of liquor outside legal trading hours – at 11am on a Sunday. The licensee contended that she was entitled to rely on s 24 because she believed, following advice given to her by a licensing inspector, that the legal trading hours were 10am to 12 noon on a Sunday. Stanley J (with whom Mack and O'Hagan JJ agreed) held that s 24 could not apply because56: "at most [the licensing inspector] could only have been purporting to tell the licensee the contents of the Liquor Act and giving her a statement of law, and that what she had was an honest and reasonable but mistaken belief in a state of law, not a similar belief in a state of fact." In principle, the present case is no different from those cases where the defence of mistake of fact failed even though the defendant believed that he or she had been given lawful authority to act as charged. In Rust57, the English Court of Appeal concluded that a highway trader was acting under a mistake of law rather than of fact when, contrary to law, he operated a stall on the highway for several years. Before setting up the stall he had consulted various officials, none of whom told him that he could not set up the stall. His belief that he had lawful authority to operate his stall did not constitute a defence, because none of the officials who he approached had the legal right to license him to operate the stall. Thus, even if the facts were as the trader believed them to be, he would not have been acting lawfully because, as a matter of law, the officials could not permit him to do so58. Similarly, in Power59, the Full Court of the Supreme Court of South Australia rejected the defence of mistake of fact where a woman, who had been convicted of the offence of loitering, claimed that she had acted under the authority of the Commonwealth Minister for Aboriginal Affairs. The woman claimed that the conviction should be quashed because she had believed that, on the authority of the Minister, she was entitled to remain where she was. However, the Minister had no authority to permit the defendant to loiter. 55 Unreported, Full Court of the Supreme Court of Queensland, 1 May 1957, Stanley, 56 Loch (Unreported, Full Court of the Supreme Court of Queensland, 1 May 1957, Stanley, Mack and O'Hagan JJ) at 2. 58 Rust [1972] 2 QB 426 at 434 per Lord Widgery CJ (Shaw and Wien JJ agreeing). 59 (1976) 14 SASR 337. McHugh Bray CJ said that the woman's belief had two parts: (1) that she was acting under the authority of the Minister; and (2) that that authority was lawful. This second belief was a mistake of law, not of fact. Because a vital part of her mistaken belief was a mistake of law, the defence of mistake of fact was not open to her60. The four cases show that, without more, a mistaken belief that an activity is lawful or authorised will be a mistaken belief as to a matter of law rather than to a matter of fact. Accordingly, the fact that Mr Palmer's mistake was induced by the conduct of an employee of Fisheries WA cannot convert what is a mistake of law into a mistake of fact. Moreover, as Mr Palmer acknowledged, for the purposes of s 24 of the Criminal Code, it is irrelevant whether the mistake of law is induced by incorrect information obtained from an official government body or from any other third party or is induced by any other form of mistaken factual understanding. Thus, in any situation where a person's mistaken belief as to the legality of an activity is based on mistaken advice, that person would not have a defence under s 24. To find otherwise would expand the scope of the defence in s 24 to an unacceptable extent. It would also undermine the principle that ignorance of the law is no excuse, a principle expressly provided for in s 22 of the Criminal Code. Order The appeal must be allowed and the conviction reinstated. In accordance with the undertaking given on behalf of Mr Ostrowski, he should pay Mr Palmer's costs for the special leave hearing and for the appeal in this Court. 60 Power (1976) 14 SASR 337 at 345 per Bray CJ. CALLINAN AND HEYDON JJ. The respondent is a professional fisherman. He was induced to fish in forbidden waters by the provision to him of inaccurate or incomplete materials by an official of the State Government department responsible for administering fisheries. The question in the appeal is whether his mistaken belief was as to a state of things or as to a matter of law. As well as raising that question the appeal provides an example of the way in which provisions for mandatory penalties61 can operate harshly and unfairly, and, as has occurred here, generate time consuming and expensive appellate litigation. Facts and relevant provisions Regulation 34 of the Fish Resources Management Regulations (WA) ("the Regulations") made under the Fish Resources Management Act 1994 (WA) ("the Act") is as follows: "34. Fishing for rock lobster in the waters surrounding Quobba Point A person who is the holder of a commercial fishing licence must not fish for rock lobsters at any time in the area described in the Table to this regulation. Penalty: $5000 and the penalty provided in section 222 of the Act. Table All that portion of the Indian Ocean bounded by a line starting from a point on the high water mark situate at the southwestern-most extremity of Quobba Point and extending south to south latitude 24° 34'; thence east to a point on the high water mark; and thence generally northwesterly along the high water mark aforesaid to the starting point." The Regulation was made under ss 256, 257(1)(a) and 257(1)(b) of the Act which provide as follows: "256. Regulations – general power The Governor may make regulations prescribing all matters that are required or permitted by this Act to be prescribed, or are necessary 61 Sections 39 and 45 of the Sentencing Act 1995 (WA) make provision for the imposition of no sentence and the making of a "spent conviction" order, but no suggestion was made that any provisions other than the Fish Resources Management Act 1994 (WA) and Regulations made under it applied here. or convenient to be prescribed for giving effect to the purposes of this Act. The regulations may create offences and may provide for a penalty not exceeding $10 000 and a daily penalty not exceeding $100. 257. Regulations – other licences The regulations may provide for the licensing of – persons engaged in commercial fishing; persons engaged recreational fishing. in specified activities by way of Section 222 of the Act provides as follows: "222. Additional penalty based on value of fish This section applies to an offence against section 43, 46, 47, 50, 51, 74, 77, 82, 86, 88 or 173 or any prescribed provision of the regulations. If a court convicts a person of an offence to which this section applies the court must, in addition to any general penalty imposed in respect of the offence, impose on the person an additional penalty equal to 10 times the prescribed value of any fish the subject of the offence. (3) A court may determine the prescribed value of any fish the subject of the offence by reference to either the weight of the fish or the number of fish. (4) A court is to determine the prescribed value of any fish the subject of the offence – if the court is determining the value of the fish by reference to the weight of the fish, by multiplying the weight by the value per unit of weight prescribed in respect of fish of that class; and if the court is determining the value of the fish by reference to the number of fish, by multiplying the number by the value per fish prescribed in respect of fish of that class. The additional penalty referred to in subsection (2) is irreducible in mitigation despite the provisions of any other Act. (6) A provision of the regulations may be prescribed for the purposes of subsection (1) by reference to the circumstances in which the offence is committed." At all material times the respondent was the lessee of a commercial fishing licence pursuant to which he fished for rock lobsters. The licence permitted him to fish in particular for western rock lobsters in a "managed fishery" with 87 pots in zone B of the western rock lobster fishery ("Zone B"). On or about 11 November 1998 the respondent visited the Fremantle office of the relevant State Government department, Fisheries Western Australia ("Fisheries WA"), to obtain the relevant regulations for Zone B. He was told by an unidentified official that "a copy of the current regulations to cover the 98/99 fishing season for lobsters" was not available, but that if he were to return on 13 November 1998, "they would have them available". Two days later, the respondent returned to the office of Fisheries WA, Fremantle, where an "office lady" at the public counter told him that the office "still did not have the regulations on hand". She volunteered however to photocopy "the copy that they had themselves". The appellant accepted that the inference that the regulations to which the woman was referring were complete was available. We interpolate that on the uncontradicted account of the respondent, the inference was irresistible. In consequence, the respondent was given a photocopy of the "West Coast Rock Lobster Limited Entry Fishery Notice 1993" made under s 32 of the Fisheries Act 1905 (WA) ("the Management Plan") and a bundle of notices given pursuant to the Fisheries Act or the Act. Neither the Management Plan nor the bundle of notices made any reference to the Regulation. At the same time the respondent was told that "if [he] required any further information [he should] take one of the pamphlets" which were on a rack in the public reception area of the Fremantle office of Fisheries WA. Accordingly, the respondent took a copy of a pamphlet entitled "Fishing for Rock Lobsters" for the 1998/99 rock lobster season issued by Fisheries WA. The pamphlet in question related to recreational fishing. It stated that the waters mentioned in the Management Plan "[were] not specifically set out in these pamphlets". It is common ground that the respondent did not inform the staff that he was the holder of a commercial fishing licence. Subsequently, it was clear that the person to whom the respondent spoke should, or would have been aware that he was a commercial fisherman because he ordered a commercial research log book at the same time. Between 5 and 10 February 1999, the respondent fished with 54 rock lobster pots within the waters described in the table to the Regulations. There is no doubt that the respondent knew the location of each of the 54 rock lobster pots. He also truly believed, it is not suggested to the contrary, that his licence permitted him to fish in the waters in which he was fishing. The respondent was observed checking and resetting the rock lobster pots by fisheries officers. They made no attempt to rebuke or stop him from continuing to fish. There is no suggestion that the respondent sought to conceal his activities in any way or that he was doing otherwise than attempting to earn a living in a responsible and lawful manner. The respondent was charged with a breach of r 34 of the Regulations. The respondent was tried by a magistrate at Carnarvon. In the course of the proceedings the appellant proved the relevant regulation and the table. This was done in accordance with the Western Australian practice, the necessity for which at common law was explained by Roberts-Smith J (Wallwork J and Pidgeon AUJ agreeing) in Norton v The Queen62. Extraordinarily, and after the uncontested facts to which we have referred emerged, the appellant pressed the prosecution. To do so in those, and the further circumstances that a conviction would result not only in the distress and opprobrium that any conviction carries, but also in the imposition of harsh mandatory penalties, has the appearance of an act of mindless oppression. The magistrate found that the respondent: "did not direct his mind to that Regulation because he did not know anything about it ... that means there is no evidence before the court about a reasonable belief as to the operation of Regulation 34. If follows ... that section 24 does not arise, the honesty and reasonableness of the [respondent's] belief are not such as required to be negatived by the prosecution. Section 22 operates ignorance of the law is no excuse." In convicting the respondent, the magistrate also observed that: "the [respondent] has acted entirely honestly and in my view, reasonably throughout". In consequence of the conviction the magistrate was obliged to impose a mandatory penalty of $27,600 pursuant to s 222 of the Act and in addition ordered that the respondent pay a fine of $500 and costs of $2000. 62 (2001) 24 WAR 488 at 520-521 [162]-[163]. The appeal to the Full Court The respondent sought, and was given leave to appeal to the Full Court of the Supreme Court of Western Australia from the whole of the decision of the magistrate. On the hearing of the appeal, the respondent applied for leave to raise an additional ground, that, if his mistake was one of law, he should still have been acquitted on the basis that the mistake was induced by an official agency of the State of Western Australia (Fisheries WA) responsible for the administration of the regulation said to have been contravened by the respondent. In presenting this argument the respondent relied upon a proposition which he contended had emerged from a series of recent Canadian cases63. Olsson AUJ in the Full Court was of the opinion that it could not be concluded that any principle to that effect had been unequivocally accepted in Canada64: in any event, his Honour said the case was not an appropriate one for the consideration of it65. The respondent's appeal to the Full Court (Malcolm CJ and Olsson AUJ, Steytler J dissenting) succeeded. The leading judgment (with which in substance Malcolm CJ agreed) was given by Olsson AUJ. His Honour stated his reasons in this way66: "With all due respect, it seems to me that, in the instant case, the learned magistrate has overlooked what was a fundamentally important facet of the pertinent circumstances. On the evidence which the learned magistrate plainly accepted, the appellant expressly went to a major office of Fisheries WA (as the proper regulatory authority) to procure from it a copy of the applicable Regulations, so that he could, inter alia, inform himself of what were, and were not, permissible fishing areas within zone B. That was, undoubtedly his express purpose, which he communicated to the relevant officer at the time. 63 See R v Jorgensen [1995] 4 SCR 55 at 68-77. 64 Palmer v Ostrowski (2002) 26 WAR 289 at 303 [93]. 65 Palmer v Ostrowski (2002) 26 WAR 289 at 304 [98]. 66 Palmer v Ostrowski (2002) 26 WAR 289 at 301-302 [67]-[78]. In response to that request officers of Fisheries WA ultimately gave him what they represented was a complete set of the relevant Fishery Notices, amended up to date. That representation was false, no doubt unwittingly. The appellant quite reasonably and accurately interpreted the material given to him as indicating that there was no gazetted restriction on fishing in the area in which he in fact worked at the time of the alleged offence. The belief arrived at by the appellant was the direct product of a mistake of fact engendered by the incorrect representations made to him, namely that the documentation supplied was complete and accurate. It was not. Hence his mistaken belief. In those circumstances the matter before the learned magistrate was, in my opinion, a classic illustration of a proper s 24 defence. The appellant had put forward evidence of an honest and reasonable, but mistaken, belief in the existence of a state of things by reason of which he acted as he did. Unlike the situation in Pennings67, he did apply his mind to the critical issue and his belief was the product of a mistake of fact induced by the actions of Fisheries WA. The statements made to him concerning the documentation supplied were positively misleading as to a vital factual state of affairs – whether they contained all applicable materials upon which he could determine his licence rights. Patently (and I may say inexcusably) they did not. Counsel for the respondent strongly contended, inter alia, that such a conclusion was the product of an erroneous characterisation of what had actually occurred. He submitted that, however such a situation came about, the conclusion of the appellant as to his right to fish in what proved to be closed waters was 'a belief as to the operation of the Regulations on his entitlement as a commercial fisherman to fish in particular waters'; and was thus a mistake of law. Accordingly, s 24 had no operation. In my view this contention cannot be upheld. On the evidence as accepted by the learned magistrate this was neither a case of mere ignorance of reg 34 nor of a mere faulty interpretation of such a regulation actually known to the appellant. Here the precipitating event which ultimately led to the commission of the proscribed act was the provision to him of the incorrect documentary information which induced the error made. The effect of the provision to 67 Penning v Williams unreported, Supreme Court of Western Australia, 13 September 1996. the appellant of the documentation omitting reg 34 (or even any reference to it) amounted to a factual representation that there was no relevant regulation bearing on the closure of the waters proposed to be fished by him. This, in turn, gave rise to a positive belief on the part of the appellant that he was entitled to drop his pots in the relevant area. In the broadest sense, a mistake of fact to which s 24 attaches will almost inevitably also involve a mistake of law. In the instant case a conclusion that the appellant was entitled to fish where he did was no doubt a belief as to a question of law. However, that conclusion cannot logically be disassociated from the factual events which gave rise to it and, in any event, a clear distinction needs to be made between the interpretation of a document on the one hand and the fact of its existence on the other: cf Iannella v French68, London Street Tramways Co Ltd v London County Council69. I consider that the correct principle to be applied in a case such as this is best summarised by the dictum of Smart J in Griffin v Marsh70 in these terms: 'If any ultimate conclusion reached by an accused, including a conclusion of law, is vitiated or flawed by an earlier mistaken but honest and reasonable belief as to a relevant and important fact, usually the mistake should be regarded as one of fact.'" The appeal to this Court Before dealing with the submissions of the parties it is appropriate to point out that the appellant appears now to have accepted that this was really a case for the exercise of a prosecutorial discretion not to prosecute because he has given this undertaking to the Court: "Instructions have been sought and obtained from the Attorney General of Western Australia that in the event the Magistrate's decision is reinstated and the conviction entered, the Executive Council will advise the Governor to remit the general penalty, the mandatory penalty and the order for costs. This undertaking, together with the agreement reached between the Appellant and the Respondent that the Respondent's costs of 68 (1968) 119 CLR 84 at 96-97. 69 [1898] AC 375 at 380-381. 70 (1994) 34 NSWLR 104 at 118. the appeal and special leave application be paid, cure any perceived injustice to the Respondent." The undertaking, unfortunately, does not completely "cure … injustice" to the respondent. The allowing of the present appeal would lead to the reinstatement of the conviction. Under s 224(2) of the Act, if three or more convictions are recorded in respect of a licence in any ten year period, the licence must be cancelled. Hence the present conviction will remain operative for s 224(2) purposes, and nothing in the undertaking overcomes the result. The appellant submitted in this Court that Olsson AUJ overstated the magistrate's findings in favour of the respondent with respect to the respondent's belief as to the completeness of the material made available to him, and the role of departmental officers in making it available. It is unnecessary to express an opinion about that because the appellant accepts that a fair description of the respondent's state of mind was that he left the Fisheries WA office believing that he had a complete set of the Regulations. As reg 34 was not reproduced in the Management Plan or the pamphlet that he was given, the respondent was unaware that fishing in the relevant area was prohibited by law. The appellant's submission adopted the reasons of Steytler J in dissent in the Full Court. The essential difference between his Honour and the majority was in the characterization of the relevant mistake, which the former considered to be a mistake of law. Before we discuss that difference we should set out the relevant provisions of the Criminal Code of Western Australia: "Ignorance of law: Bona fide claim of right Ignorance of the law does not afford any excuse for an act or omission which would otherwise constitute an offence, unless knowledge of the law by an offender is expressly declared to be an element of the offence. But a person is not criminally responsible, as for an offence relating to property, for an act done or omitted to be done by him with respect to any property in the exercise of an honest claim of right and without intention to defraud. Mistake of fact71 24. A person who does or omits to do an act under an honest and reasonable, but mistaken, belief in the existence of any state of things is not criminally responsible for the act or omission to any greater extent than if the real state of things had been such as he believed to exist. The operation of this rule may be excluded by the express or implied provisions of the law relating to the subject." Section 36 of the Code makes the provisions with respect to criminal responsibility applicable to all offences: "Application of Chapter V The provisions of this chapter apply to all persons charged with any offence against the statute law of Western Australia." Steytler J characterized the respondent's mistake as one of law in this way72: "The appellant, in my respectful opinion, made no mistake of fact in respect of any element of the offence with which he was charged. He knew that he was fishing for lobster. He knew where he was fishing for lobster. This is not a case in which he believed that he was somewhere other than the place where he in fact was or in which he believed that he was fishing for something other than what in fact he was fishing for and hence that his conduct in fishing at that place was lawful. Rather, the only mistake that he made was to believe that it was lawful for him to fish for lobster in the place in which he was in fact fishing. That, in my opinion, was a mistake of law." Section 24 of the Code upon which the respondent relies refers to a mistaken belief in the existence of any state of "things". The use of the word "things" is significant. It implies a concept somewhat wider and different from a mere mistaken belief of a fact or a fact exclusively. Otherwise, it may be asked, why was the word "facts" rather than "things" not used? An orthodox approach to statutory interpretation by a reader unaware of the history of the Code and Ch V might well be inclined to regard "things" as embracing every imaginable 71 Section 32(2) of the Interpretation Act 1984 (WA) provides that section headings are not to be taken to be part of the Act. 72 Palmer v Ostrowski (2002) 26 WAR 289 at 295 [22]. state of affairs, as to law or fact, and both of them, whether intermixed or quite distinct. A view not inconsistent with such a construction has some support from the dissenting judgment of Isaacs and Powers JJ in this Court in Duncan v Theodore73 and in the opinion of the Privy Council on appeal74 from it to which we will make reference again later. The provision has of course to be read and given meaning in context and subject to reduction or refinement to the extent that the Code otherwise states. The Code does however so state, in what might be thought to be explicit terms, by excluding, by s 22, ignorance of "the law". The history of the two sections was considered and summarized by Steytler J in the Full Court75: "As Brennan J (as he then was) has pointed out in He Kaw Teh v The Queen76, provisions of this kind, when first drafted in this form (and the first draft of its kind was done by Sir Samuel Griffith), were intended to reflect the common law (see also the comments of Dixon J in Thomas v The King77). As Brennan J also pointed out, in earlier times criminal responsibility was imposed upon or imputed to an accused upon proof of the external elements of an offence alone78 and hence an honest and reasonable but mistaken belief in a state of facts which would make the supposed offender's act innocent was treated as an excuse or a true exception to criminal responsibility. Brennan J points out (He Kaw Teh79) that the origin of that state of mind as an exception is reflected in the exculpatory form in which it appears in the Criminal Codes (including that in this State) which have adopted Sir Samuel Griffith's draft, although the prosecution bears the ultimate onus of negativing the defence: see Woolmington v Director of Public Prosecutions80; He Kaw Teh." 73 (1917) 23 CLR 510. 74 Theodore and Beal v Duncan (1919) 26 CLR 276; [1919] AC 696. 75 Palmer v Ostrowski (2002) 26 WAR 289 at 293 [13]. 76 (1985) 157 CLR 523 at 572-573. 77 (1937) 59 CLR 279 at 306. 78 Turner, Russell on Crime, 12th ed (1964), vol 1 at 33-34. 79 (1987) 157 CLR 523 at 573. It is impossible not to sympathize with the respondent. On any fair and objective view he was not culpable in any way. To the contrary he was most diligent. He went to the office of the administering authority twice in order to ascertain what his obligations were. Entirely openly and strictly in accordance with his licence he sought to comply with his understanding of what he could do based on official information personally provided by officials. Be that as it may, it is the task of this Court to apply the law by answering the question whether the respondent should be regarded merely as having been ignorant of the law, an excuse which s 22 of the Code would deny him, or whether he had an honest and reasonable, but mistaken, belief in the existence of a state of things which if they had in fact existed would have meant that he was not criminally responsible. The question is an important one. A mockery would be made of the criminal law if accused persons could rely on, for example, erroneous legal advice, or their own often self-serving understanding of the law as an excuse for breaking it, however relevant such matters might be to penalty when a discretion, unlike here, in relation to it may be exercised. The evidence and the findings as to the respondent's honesty and reasonableness are one way and need no further reference. What then were the mistaken "things" which he honestly and reasonably believed to exist? Olsson AUJ described them as the completeness of the "applicable materials upon which [the respondent] could determine his licence rights"81. We do not disagree with that description so far as it goes but do not think that it is a complete one. It is also another matter whether the things to which his Honour referred formed part of or constituted the relevant operative mistake. The respondent submits that the matter or matters of which he was unaware were of mixed fact and law. Dixon J in Thomas v The King82 acknowledged the possibility in an appropriate case of a compound of law and fact. He said: "But, in any case, in the distinction between mistakes of fact and of law, a mistake as to the existence of a compound event consisting of law and fact is in general one of fact and not a mistake of law. This is brought out by an apposite passage in the judgment of Jessel MR in Eaglesfield v Marquis of Londonderry83:– 'A misrepresentation of law is this: when 81 (2002) 26 WAR 289 at 301 [73]. 82 (1937) 59 CLR 279 at 306. 83 (1876) 4 Ch D 693 at 702. you state the facts, and state a conclusion of law, so as to distinguish between facts and law. The man who knows the facts is taken to know the law; but when you state that as a fact which no doubt involves, as most facts do, a conclusion of law, there is still a statement of fact and not a statement of law.'" Isaacs and Powers JJ were in dissent in Duncan v Theodore in which understandings or beliefs as to relevant matters were discussed. They said there of a provision84 in the Sugar Acquisition Act 1915 (Q)85: "Maxwell on Statutes refers to this class of enactment as one where the words 'under' and 'by virtue of' and 'in pursuance of' do not mean what the words in their plain and unequivocal sense convey, and that they must be modified to carry out the object of the enactment. Belief of the defendant is required, the learned author says, 'in the existence of such (1) facts, or (2) state of things as would, if really existing, have justified his conduct.' (We have numbered and italicized the two expressions 'facts' and 'state of things.') It will be seen that 'state of things' includes the existence of a law or a valid regulation under a law." (footnote omitted) Duncan v Theodore subsequently went on appeal to the Privy Council86 where it was held that the relevant proclamation had been validly made with the result that it was not necessary for their Lordships to consider the effect of the protective provision. In the course of their opinion, their Lordships said however that they were "in agreement with the view of the Act taken as the conclusion of the powerful reasoning of Isaacs and Powers JJ."87 The case is distinguishable. It was a civil case and was concerned with one provision in an enactment and not the relationship between two provisions in a criminal code based on the common law at the time of its composition. 84 Section 7 of the Sugar Acquisition Act 1915 (Q) relevantly provided: "No action ... shall lie ... against His Majesty or the Treasurer, or any officer or person acting in the execution of the Proclamation hereby ratified ... or any other Proclamation made under this Act, or of this Act, for or in respect of any damage ... alleged to be sustained by reason of the making of the said or any such Proclamation or the passing of this Act, or of the operation thereof, or of anything done or purporting to be done thereunder, save only for or in respect of the value ... of any raw sugar (or other commodity) acquired by His Majesty." 85 (1917) 23 CLR 510 at 536. 86 Theodore and Beal v Duncan (1919) 26 CLR 276; [1919] AC 696. 87 Theodore and Beal v Duncan (1919) 26 CLR 276 at 283; [1919] AC 696 at 707. The difficulty for the respondent is that there were here a series of mistakes, the one to which Olsson AUJ referred, the actual decision to rely on the information with which he had been provided, and the actual reliance, by fishing in the embargoed waters. The last is a different mistake from, for example, a mistake as to the location of his vessel or his lobster pots. The last, it can be seen, is discrete in time, place and physical activity from the other two, although but for them it is unlikely that it would have been made. The offence of which the respondent was convicted was not of failing to obtain, or hold and rely on complete and accurate materials, but of fishing where professional fishing was impermissible. The elements of the offence consisted of fishing in the embargoed waters, an activity which the respondent knew to be proscribed. Unfortunately, in the circumstances he could be no less guilty than a motorist who has done everything reasonably possible to ascertain the speed limits on a stretch of roadway along which he is to travel but having failed to do so, in one or more instances, exceeds those limits because he was unaware of them. During the course of the appeal the appellant objected to any reliance by the respondent on the ground of defence which the Full Court did not need to determine, that is, a defence of official inducement to act, because evidence relevant to it might have been adduced at trial had it been raised there. The objection was upheld and accordingly needs no further reference. We regret to say that for the reasons which we have given the appeal must be upheld. The judgment of the Full Court of the Supreme Court of Western Australia should be set aside and the conviction reinstated. The order for costs in favour of the respondent in the Full Court should stand. The appellant should pay the respondent's costs of the application for special leave and the costs of the appeal as agreed by the appellant.
HIGH COURT OF AUSTRALIA AND APPELLANT THE STATE OF WESTERN AUSTRALIA RESPONDENT Rizeq v Western Australia [2017] HCA 23 21 June 2017 ORDER Appeal dismissed. On appeal from the Supreme Court of Western Australia Representation M D Howard SC with J S Stellios and R R Joseph for the appellant (instructed by Minter Ellison Lawyers) P D Quinlan SC, Solicitor-General for the State of Western Australia with R Young for the respondent (instructed by State Solicitor (WA)) S P Donaghue QC, Solicitor-General of the Commonwealth with the K L Walker QC and G A Hill for Commonwealth, (instructed by Australian Government Solicitor) the Attorney-General of intervening M G Sexton SC, Solicitor-General for the State of New South Wales with S Robertson for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor (NSW)) P J Dunning QC, Solicitor-General of the State of Queensland with F J Nagorcka for the Attorney-General of the State of Queensland, intervening (instructed by Crown Solicitor (Qld)) M E O'Farrell SC, Solicitor-General of the State of Tasmania with S K Kay for the Attorney-General of the State of Tasmania, intervening (instructed by Crown Solicitor for Tasmania) R M Niall QC, Solicitor-General for the State of Victoria with S Gory for the Attorney-General for the State of Victoria, intervening (instructed by Victorian Government Solicitor) C D Bleby SC, Solicitor-General for the State of South Australia with L K Byers for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Rizeq v Western Australia Constitutional law (Cth) – Courts – State courts – Federal jurisdiction – Diversity jurisdiction – Where appellant resident of New South Wales – Where appellant indicted for offence against law of Western Australia – Where matter between State and resident of another State within meaning of s 75(iv) of Constitution – Where District Court of Western Australia exercising federal jurisdiction – Whether provisions of State Act picked up and applied as Commonwealth law – Whether s 79 of Judiciary Act 1903 (Cth) operates in respect of s 6(1)(a) of Misuse of Drugs Act 1981 (WA) – Whether s 79 of Judiciary Act 1903 (Cth) operates in respect of s 114(2) of Criminal Procedure Act 2004 (WA). Criminal law – Appeal against conviction – Where trial by jury in federal jurisdiction – Where majority verdict of guilty returned – Whether unanimous jury verdict required by s 80 of Constitution – Whether majority jury verdict permitted under s 114(2) of Criminal Procedure Act 2004 (WA). Words and phrases – "accrued jurisdiction", "diversity jurisdiction", "Federal Judicature", "federal jurisdiction", "jurisdiction", "matter", "picked up and applied", "power", "State jurisdiction", "State legislative capacity", "trial by jury". Constitution, ss 75(iv), 80. Criminal Procedure Act 2004 (WA), s 114(2). Judiciary Act 1903 (Cth), ss 39(2), 79, 80. Misuse of Drugs Act 1981 (WA), s 6(1)(a). KIEFEL CJ. The appellant was tried on indictment before a jury in the District Court of Western Australia for offences against s 6(1)(a) of the Misuse of Drugs Act 1981 (WA) ("the MDA"). The offences were alleged to have been committed in that State. At all relevant times the appellant was a resident of New South Wales. The appellant was convicted by a majority verdict in accordance with s 114(2) of the Criminal Procedure Act 2004 (WA) ("the Criminal Procedure Act") and was sentenced to a term of imprisonment. An appeal against his conviction was dismissed1. He contends that his conviction was unlawful because s 80 of the Constitution requires that, on a trial on indictment of any offence against a law of the Commonwealth, the verdict of the jury be unanimous2. He argues that s 6(1)(a) of the MDA applied to his trial as a Commonwealth law, not as a law of Western Australia, because s 79 of the Judiciary Act 1903 (Cth) ("the Judiciary Act") "picked up" and applied s 6(1)(a) as a Commonwealth law. Section 79 operated in this way because the District Court was exercising federal jurisdiction. The basic proposition for which the appellant contends is that, as a State law, s 6(1)(a) could not apply of its own force in federal jurisdiction. Federal jurisdiction invested The High Court is given original jurisdiction by s 75 of the Constitution with respect to certain matters. The matters referred to in s 75(iv), sometimes referred to as "federal diversity jurisdiction"3, include a matter between a State and a resident of another State. The matter here in question between the State of Western Australia and the appellant is whether the appellant is guilty of the offences with which he is charged under the MDA, and, if so, the sentence which should be imposed on him. Section 77(iii) of the Constitution provides that the Commonwealth Parliament may make laws investing any court of a State with federal jurisdiction. Section 39(2) of the Judiciary Act invests State courts with federal jurisdiction in all matters in which the High Court has original jurisdiction (or in which original jurisdiction can be conferred on it), within the limits of their respective jurisdictions and subject to certain conditions and restrictions not presently relevant. 1 Hughes v Western Australia (2015) 299 FLR 197. 2 Cheatle v The Queen (1993) 177 CLR 541; [1993] HCA 44. John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 518 [18]; [2000] HCA 36. A State court invested with federal jurisdiction, while acting in that capacity, becomes part of the Federal Judicature4. Chapter III provides for an "integrated national court system"5. The lead provision of Ch III, s 71, vests the judicial power of the Commonwealth in the High Court, any other federal courts, and "such other courts as [Parliament] invests with federal jurisdiction". Covering cl 5 of the Constitution provides that laws made by the Commonwealth Parliament are binding on the courts, judges and people of every State. The effect of s 39(1) of the Judiciary Act6 is to withdraw from State courts the jurisdiction they would have had to apply federal laws by reason of covering cl 5 and s 39(2) of the Judiciary Act restores it as an invested federal jurisdiction7. A State court invested with federal jurisdiction may apply federal laws. It is well accepted that in federal jurisdiction State and federal courts can apply both Commonwealth and State laws, as the matter in question requires. Commonwealth and State laws, together with the common law of Australia, comprise a "single though composite body of law"8 to be applied. A matter determined in federal diversity jurisdiction, to which s 75(iv) of the Constitution refers, may involve little, if any, Commonwealth law. The point presently to be made is that the investment of "federal jurisdiction" is not a direction as to the law to be applied. It is the investment of authority for a State court to adjudicate. Federal jurisdiction – the authority to adjudicate A legislative grant of federal jurisdiction simply means that authority is given to a court to hear and determine a matter9. In Baxter v Commissioners of 4 Zines, Cowen and Zines's Federal Jurisdiction in Australia, 3rd ed (2002) at 5 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 138; [1996] HCA 24. 6 Section 39(1) of the Judiciary Act 1903 (Cth) provides that "[t]he jurisdiction of the High Court, so far as it is not exclusive of the jurisdiction of any Court of a State by virtue of section 38, shall be exclusive of the jurisdiction of the several Courts of the States, except as provided in this section." 7 Felton v Mulligan (1971) 124 CLR 367 at 394 per Windeyer J; [1971] HCA 39. 8 Felton v Mulligan (1971) 124 CLR 367 at 392 per Windeyer J. 9 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087; [1907] HCA 76. Taxation (NSW)10, Isaacs J explained11 that State jurisdiction is the authority to adjudicate which State courts possess under State laws; federal jurisdiction is the authority to adjudicate they derive from the Constitution and laws made under it. Federal jurisdiction, understood as the authority conferred upon a court to adjudicate a matter, is to be distinguished from the law that that court applies in the exercise of that jurisdiction12. In Anderson v Eric Anderson Radio & TV Pty Ltd13, Kitto J explained14 that the conferral of federal jurisdiction merely provided a different basis for the authority of a court to enforce whatever law is applicable to the matter before it. It does not change the law the court enforces in adjudicating upon that matter. It follows that the fact that a court is exercising federal jurisdiction says nothing about the laws to be applied in a particular case. In Anderson v Eric Anderson Radio & TV Pty Ltd15 it was argued that "the essential nature of federal jurisdiction" could explain why the usual choice of law rules were inapplicable. In rejecting that argument, Kitto J said that, of itself, "federal jurisdiction" provided no answer at all "for all that is meant by saying that a court has federal jurisdiction in a particular matter is that the court's authority to adjudicate upon the matter is a part of the judicial power of the federation". The federal jurisdiction that a State court is given to hear and determine a matter must also be distinguished from provisions made by statute which provide a court with powers it may exercise in the hearing and determination of a matter, and in otherwise regulating the proceedings before it. Section 79 of the Judiciary Act Section 51(xxxix) of the Constitution permits laws to be made by the Commonwealth Parliament which are incidental to the execution of any power vested in the Federal Judicature referred to in Ch III. The Federal Judicature is to be understood to include State courts exercising federal jurisdiction. 10 (1907) 4 CLR 1087. 11 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142. 12 Felton v Mulligan (1971) 124 CLR 367 at 393. 13 (1965) 114 CLR 20; [1965] HCA 61. 14 Anderson v Eric Anderson Radio & TV Pty Ltd (1965) 114 CLR 20 at 30. 15 (1965) 114 CLR 20 at 29-30. The Commonwealth Parliament could make laws directed to those courts respecting the matters which might be commenced in them, the processes to be applied in hearing them and orders made in determination of them, provided those laws are otherwise within the limitations of s 51(xxxix) and Ch III. It would, however, be difficult to make provision for every conceivable proceeding brought before a State court in federal jurisdiction. The solution, or part of it, which has been adopted is the enactment of a general provision. Section 79(1) of the Judiciary Act provides: "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." Section 80 of the Judiciary Act makes provision for the common law to apply in the exercise of federal jurisdiction but no question here arises as to its application. This case is concerned solely with statute law. There is another, important, reason why s 79(1) was necessary and which explains both its purpose and its sphere of operation. State laws of the kind mentioned cannot apply of their own force to State courts exercising federal jurisdiction in that State16. State legislatures have no constitutional power to make such laws17. When an exercise of legislative power is directed to the judicial power of the Commonwealth, it must operate through, or in conformity with, Ch III of the Constitution18. Section 79 fills the gap created by any absence of Commonwealth laws which provide a court with powers necessary for the hearing and determination of a matter and the presence of State laws of this kind which cannot operate of their own force in federal jurisdiction. It operates by "picking up" State laws and applying them as Commonwealth law19. 16 Solomons v District Court (NSW) (2002) 211 CLR 119 at 134 [21]; [2002] HCA 17 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 406 [230]; [2005] HCA 44. 18 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270; [1956] HCA 10. 19 Commissioner of Stamp Duties (NSW) v Owens [No 2] (1953) 88 CLR 168 at 170; [1953] HCA 62. In Commissioner of Stamp Duties (NSW) v Owens [No 2]20, the Court said21 that when federal jurisdiction is exercised, the purpose of s 79 is to "adopt the law of the State … as the law by which ... the rights of the parties to the lis are to be ascertained and matters of procedure are to be regulated". It may be observed that the Court did not say that the law to be adopted is that which provides for the rights or liabilities of the parties to proceedings. It is important to an understanding of s 79 that, as that provision fills the gap created by a lack of Commonwealth law governing when and how a court exercising federal jurisdiction is to hear and determine a matter, its terms and its purpose are directed to courts. It has been said22 that the laws referred to in s 79 include substantive laws. Since that statement was made it has been recognised that there may be difficulties in applying traditional conceptions of whether a law is procedural or substantive, those regulating the mode and conduct of court proceedings generally being regarded as procedural and those concerning the existence or enforceability of rights or duties of the parties to proceedings as substantive23. Much may depend upon statutory context. It is not a correct approach to an understanding of the operation of s 79 to determine its application to a law by reference to whether that law is "procedural" or "substantive". It is necessary to have regard to the purpose of s 79 in connection with the courts to which it is directed. Section 79(1) is not directed to the rights and duties of persons. It is directed to courts exercising federal jurisdiction. Its purpose is to fill a gap in the laws which will regulate matters coming before those courts and to provide those courts with powers necessary for the hearing or determination of those matters. The laws upon which s 79 operates should be understood in this way. The examples given in s 79(1) of laws relating to procedure and evidence are, clearly enough, laws necessary for the hearing of a matter. State laws which provide a court with powers to make particular orders24, grant injunctive relief25 20 (1953) 88 CLR 168. 21 Commissioner of Stamp Duties (NSW) v Owens [No 2] (1953) 88 CLR 168 at 170. 22 R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 330; [1957] HCA 18. 23 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 542-543 [97]. 24 R v Oregan; Ex parte Oregan (1957) 97 CLR 323. 25 Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 586-587 [56]; [2001] HCA 1. or impose a penalty26 are necessary for the determination of a matter. These are not State laws which can operate of their own force upon courts exercising federal jurisdiction. It is necessary that s 79 operate upon them so that they may be "picked up" and applied. Section 79 has been held to apply to laws which provide that contribution may be sought by a tortfeasor which has been held liable from another tortfeasor27. And it has been applied to statutes of limitations provisions28. State laws of this kind are also to be understood by reference to the purpose of s 79 rather than whether they are substantive laws because they affect rights. They may be understood as laws which define the circumstances in which a proceeding may, or may not, be brought in a court and which permit a court to determine that matter. Without s 79 they could not apply to courts exercising federal jurisdiction. Section 79 clearly applies to s 114(2) of the Criminal Procedure Act. That provision regulates the manner in which the matter of a person's guilt or innocence is to be adjudicated and for that reason is directed to State courts. State laws concerning sentencing are necessarily directed to those courts. Such laws could not apply to State courts exercising federal jurisdiction unless s 79 operated upon them and picked them up. Section 6(1)(a) of the MDA – a State law applying of its own force? Section 6(1)(a) of the MDA is not a law of the kind referred to above and may be contrasted with s 114(2) of the Criminal Procedure Act. It is addressed to the conduct of individuals and renders them liable to prosecution for offences. It is not directed to State courts and their powers to hear and determine a matter. A State court is invested with federal jurisdiction to hear and determine particular matters in accordance with "independently existing substantive law"29. This includes any applicable statute law, including that of a State. State laws are 26 Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 90-91 [112]; [2006] HCA 44. 27 Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136; [2000] HCA 39. 28 John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 83, 89; [1973] HCA 21. 29 Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 586 [55], 587 [57]. preserved by the Constitution30. Subject to any question of inconsistency31, there is no reason why a State statute creating an offence should not continue to apply where a State court is invested with federal jurisdiction. The question raised in this appeal was addressed by French CJ in Momcilovic v The Queen32. In that case a resident of Queensland was convicted of an offence under the Drugs, Poisons and Controlled Substances Act 1981 (Vic), which was committed in Victoria. It was accepted that the County Court and the Supreme Court of Victoria had exercised federal diversity jurisdiction. The question of the operation of s 79 of the Judiciary Act was not raised in argument. However, French CJ said that there was much to be said for the view that the State offence provisions applied directly and not by virtue of s 7933. His Honour observed that the position of a State court exercising federal diversity jurisdiction in a matter arising under State law may be thought to be similar to that of a federal court exercising an "accrued jurisdiction"34, where the federal court is required to deal with a claim under State law because that claim forms part of the "matter" in respect of which it exercises federal jurisdiction35. In such cases, "non-federal law" is part of the "single, composite body of law applicable alike to cases determined in the exercise of federal jurisdiction and to cases determined in the exercise of non-federal jurisdiction"36. The appellant nevertheless submits that there are decisions of this Court which hold that a law such as s 6(1)(a) must be picked up by s 79 and applied as a Commonwealth law. The appellant relies on five decisions of this Court in support of this contention37. 30 Constitution, ss 106, 107, 108. 31 Constitution, s 109. 32 (2011) 245 CLR 1; [2011] HCA 34. 33 Momcilovic v The Queen (2011) 245 CLR 1 at 68-69 [99]. 34 Use of the term "accrued jurisdiction" has been criticised: Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 35 Momcilovic v The Queen (2011) 245 CLR 1 at 69 [100]. 36 Fencott v Muller (1983) 152 CLR 570 at 607; [1983] HCA 12. 37 R v Oregan; Ex parte Oregan (1957) 97 CLR 323; Parker v The Commonwealth (1965) 112 CLR 295; [1965] HCA 12; Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136; Australian Securities and Investments (Footnote continues on next page) The reasons why s 79 operated upon the State laws in three of the cases referred to by the appellant are explicable by reference to the purpose of s 79. They were laws directed to State courts and their powers. Austral Pacific Group Ltd (In liq) v Airservices Australia38 concerned provisions relating to proceedings for contribution as between tortfeasors and the exercise of the power conferred on the court to determine the amount of contribution. Such provisions may be understood as directed to courts, as discussed above, and are therefore laws to which s 79 refers. Similarly, in Parker v The Commonwealth39, the State law which Windeyer J identified as picked up by s 79 made provision for the assessment, by the court, of damages. In R v Oregan; Ex parte Oregan40, Webb J said41 that the laws referred to in s 79 include substantive laws, such as those dealing with the custody of infants. However, the provision which his Honour identified as applicable was one which directed the court making an order with respect to custody to consider the interests of the child as paramount. These cases have nothing to say about an offence provision such as s 6(1)(a) of the MDA. In Macleod v Australian Securities and Investments Commission42, there was no issue that the offence was one against a law of Western Australia and that the State courts were exercising federal jurisdiction43. The point of that case was that the appeal by the Australian Securities Commission (as it then was) was incompetent because its powers did not extend to taking that action44. The appellant places particular reliance on what was said in the remaining case, Australian Securities and Investments Commission v Edensor Nominees Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559; Macleod v Australian Securities and Investments Commission (2002) 211 CLR 287; [2002] HCA 37. 38 (2000) 203 CLR 136. 39 (1965) 112 CLR 295. 40 (1957) 97 CLR 323. 41 R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 330-331. 42 (2002) 211 CLR 287. 43 Macleod v Australian Securities and Investments Commission (2002) 211 CLR 287 44 Macleod v Australian Securities and Investments Commission (2002) 211 CLR 287 Pty Ltd45. One provision of the Corporations Law (Vic) created the offence in question; two others provided the basis for the Court to order injunctions. Clearly enough s 79 could pick up the latter two provisions. It does not appear to me that the joint reasons of Gleeson CJ, Gaudron and Gummow JJ suggested that the offence provision was also picked up. In any event, if there are statements in these cases which are to be understood in the way for which the appellant contends, they cannot be regarded as concluding the question presently before the Court. The question whether s 79 of the Judiciary Act must pick up a provision like s 6(1)(a) of the MDA for it to have force and effect was neither argued nor discussed in those cases. Conclusion Section 79 of the Judiciary Act is directed to courts. Its purpose is to fill the gaps created by a lack of Commonwealth law governing when and how a court exercising federal jurisdiction is to hear and determine a matter and the inability of a State law to apply directly to that court whilst exercising federal jurisdiction. In such a case it is necessary that s 79 adopt the State provision and apply it. Section 114(2) of the Criminal Procedure Act is a provision of this kind. Section 6(1)(a) of the MDA is not. Its application was unaffected by the fact that the offence it created was tried in federal jurisdiction. It was not necessary for s 79 of the Judiciary Act to adopt it. Section 6(1)(a) of the MDA applied directly. It follows that s 80 of the Constitution was not engaged. The appeal should be dismissed. 45 (2001) 204 CLR 559 at 587-588 [57]-[58]. Bell NettleJ BELL, GAGELER, KEANE, NETTLE AND GORDON JJ. Introduction This appeal raises questions of systemic significance about the sources of law in federal jurisdiction and about the operation of s 79 of the Judiciary Act 1903 (Cth). through The State of Western Australia, its Director of Public Prosecutions, indicted Mr John Rizeq, a resident of New South Wales, in the District Court of Western Australia on two charges of offences against s 6(1)(a) of the Misuse of Drugs Act 1981 (WA). After a trial by a jury of 12 persons, the jury was unable to reach a unanimous verdict on either charge. The decisions of 11 of the 12 jurors were taken by the District Court to be verdicts of guilty under s 114(2) of the Criminal Procedure Act 2004 (WA). The District Court accordingly convicted Mr Rizeq of both offences. Mr Rizeq sought leave to appeal against the convictions to the Court of Appeal of the Supreme Court of Western Australia under Pt 3 of the Criminal Appeals Act 2004 (WA). The Court of Appeal granted leave to appeal on two grounds but dismissed the appeal46. Mr Rizeq now appeals, by special leave, to this Court from the dismissal by the Court of Appeal of his appeal on one of those grounds. Mr Rizeq's argument on the appeal proceeds from an uncontested premise. The premise is that the controversy as to his criminal liability which was the subject of his indictment by the State of Western Australia was a matter between a State and a resident of another State within the meaning of s 75(iv) of the Constitution, as a consequence of which the District Court was exercising federal jurisdiction under s 39(2) of the Judiciary Act in conducting the trial and entering the convictions47. The argument is that, because the District Court was exercising federal jurisdiction in the trial, Western Australian law was incapable of valid trial. application Section 6(1)(a) of the Misuse of Drugs Act could not, and therefore did not, apply the determination of his criminal liability that 46 Hughes v Western Australia (2015) 299 FLR 197. 47 See Momcilovic v The Queen (2011) 245 CLR 1 at 68-69 [99], 82 [139]; [2011] HCA 34. Bell NettleJ as a law of Western Australia. Instead, so the argument goes, the text of s 6(1)(a) was picked up and applied as a law of the Commonwealth by s 79 of the Judiciary Act. The result was that the trial in the District Court was a trial on indictment of offences against a law of the Commonwealth to which s 80 of the Constitution applied to require the verdicts of the jury to be unanimous48. The argument provides an opportunity for this Court now to resolve some doubts, which must be acknowledged regrettably to have arisen49, about the sources of law in federal jurisdiction and about the operation of s 79 of the Judiciary Act. The analysis adopted to resolve those doubts is consistent with that suggested by French CJ in Momcilovic v The Queen50. The analysis is in substance that for which the State of Western Australia as respondent to the the the support of appeal contends, with Commonwealth and each of the other States, who intervene in the appeal. the Attorneys-General of The short answer to Mr Rizeq's argument is that s 6(1)(a) of the Misuse of Drugs Act applied to impose criminal liability on him as a law of Western Australia at the time of his offences and continued to apply to govern his criminal liability notwithstanding that the jurisdiction subsequently exercised by the District Court to resolve the controversy between him and the State of Western Australia about the existence and consequences of that criminal liability was federal jurisdiction. Notwithstanding that the District Court was exercising federal jurisdiction in conducting the trial and entering the convictions, s 79 of the Judiciary Act was not needed, and was not engaged, to pick up and apply the text of s 6(1)(a) of the Misuse of Drugs Act as a law of the Commonwealth. The trial was of offences against a law of a State and not of offences against a law of the Commonwealth, and s 80 of the Constitution had no application. That the District Court was exercising federal jurisdiction in conducting the trial did, in contrast, mean that s 79 of the Judiciary Act was needed, and was engaged, to pick up and apply the text of s 114(2) of the Criminal Procedure Act 48 See Cheatle v The Queen (1993) 177 CLR 541; [1993] HCA 44. 49 See Lindell, Cowen and Zines's Federal Jurisdiction in Australia, 4th ed (2016) at 348-391; Hill and Beech, "'Picking up' State and Territory Laws under s 79 of the Judiciary Act – Three Questions", (2005) 27 Australian Bar Review 25. 50 (2011) 245 CLR 1 at 69-70 [100]. Bell NettleJ as a law of the Commonwealth. As a consequence, the decisions of 11 of the 12 jurors were properly taken by the District Court to be verdicts of guilty. To explain that answer, it is necessary to start with some very basic observations about the structure of the Constitution before moving to the specific topic of the operation of the centrally relevant provisions of the Judiciary Act. Constitution Jurisdiction, law and legislative power Making express what would otherwise be implicit in the nature of the Constitution as a written federal constitution, covering cl 5 of the Constitution provides in relevant part that the Constitution itself "and all laws made by the Parliament of the Commonwealth under the Constitution, shall be binding on the courts, the Commonwealth, notwithstanding anything in the laws of any State". judges, and people of every State and of every part of The powers of the Parliament of the Commonwealth to make laws are limited to those enumerated in Ch I of the Constitution, specifically in ss 51 and 52, and to those expressed or implied elsewhere in the Constitution, including in Ch III. The Parliament has specific power under s 51(xxxix) to make laws with respect to matters incidental to the execution of any power vested by the Constitution in the "Federal Judicature". The "Federal Judicature" for that purpose is not limited to the High Court and other federal courts created by the Parliament of the Commonwealth. It includes, as a "component part"51, State courts invested with federal jurisdiction. The power conferred on the Parliament of the Commonwealth by s 51(xxxix) of the Constitution relevantly extends to authorise enactment of laws incidental to the exercise of a power of adjudication conferred or vested in a court by or under Ch III or necessary or proper to make the exercise of such a power of adjudication effective52. The Parliament has no power, express or implied, to impose liabilities or confer rights on persons who are parties to a 51 Le Mesurier v Connor (1929) 42 CLR 481 at 514; [1929] HCA 41. See Lindell, Cowen and Zines's Federal Jurisdiction in Australia, 4th ed (2016) at 257-258. 52 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 580 [122]; [1999] HCA 27. See also R v Federal Court of Bankruptcy; Ex parte Lowenstein (1938) 59 CLR 556 at 587; [1938] HCA 10. Bell NettleJ justiciable controversy merely because the adjudication of that controversy is or has come within the purview of Ch III. The powers of the Parliaments of the States are addressed in Ch V of the Constitution. Subject to the Constitution, a State Parliament is sustained as part of the constitution of the State by s 106, and powers of a State Parliament to make laws are sustained by s 107 except to the extent powers to make laws are by the Constitution "exclusively vested in the Parliament of the Commonwealth or withdrawn from the Parliament of the State". The supremacy of laws made by the Parliament of the Commonwealth over laws made by the Parliaments of the States presaged in covering cl 5 is then secured by the prescription in s 109 that "[w]hen a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid". "Of course s 109 is intended to operate and can operate only where the law of a State and the law of the Commonwealth with which it is inconsistent are laws which apart from the operation of s 109 are valid."53 The operation of s 109, as has always been recognised, is to resolve an inconsistency between "a law of a State otherwise within its competency" and "a law of the Commonwealth the the Commonwealth"54. competency of also within legislative The overall result is that laws made by the Parliament of the Commonwealth and laws made by the Parliaments of the States form "a single though composite body of law"55. Before the Australia Act 1986 (Cth), that composite body of law included Imperial laws of paramount application. Since the enactment of the Northern Territory (Self-Government) Act 1978 (Cth) and the Australian Capital Territory (Self-Government) Act 1988 (Cth) under s 122 of the Constitution, that composite body of law has included laws made by the legislatures of self-governing Territories. Chapter III of the Constitution makes provision for what has come aptly to be described as an "integrated national court system"56 within which, since the 53 R v Phillips (1970) 125 CLR 93 at 126; [1970] HCA 50. See also at 109. 54 D'Emden v Pedder (1904) 1 CLR 91 at 111; [1904] HCA 1. 55 Felton v Mulligan (1971) 124 CLR 367 at 392; [1971] HCA 39. See also Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 564; [1997] HCA 25. 56 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 138; [1996] HCA 24. Bell NettleJ termination of appeals to the Privy Council by the Australia Act, the High Court alone has exercised ultimate appellate jurisdiction. Chapter III, in so doing, does nothing to undermine the singularity or integrity of the composite body of Commonwealth and State law for which Chs I and V and s 122 of the Constitution make principal provision. The distinction which Ch III draws between federal jurisdiction and State jurisdiction (the latter being the jurisdiction referred to in s 77(ii) as "jurisdiction … which belongs to … the courts of the States") is a distinction as to the available sources of authority to adjudicate controversies arising under that composite body of law. Explaining the similarity and the difference between federal jurisdiction and State jurisdiction, Isaacs J said in Baxter v Commissioners of Taxation (NSW)57: "'Jurisdiction' is a generic term and signifies in this connection authority to adjudicate. State jurisdiction is the authority which State Courts possess to adjudicate under the State Constitution and laws; federal jurisdiction is the authority to adjudicate derived from the Commonwealth Constitution and laws. The first is that which 'belongs to' the State Courts within the meaning of sec 77; the latter must be 'vested in' them by Parliament." Federal jurisdiction, which the Parliament of the Commonwealth is empowered to vest in a State court under s 77(iii) or to confer on a federal court other than the High Court under s 77(i), is authority to adjudicate on a matter within any of the five enumerated categories of matter in respect of which the High Court is given entrenched original jurisdiction by s 75, or within any of the four additional enumerated categories of matter in respect of which the Parliament is empowered to confer original jurisdiction on the High Court under s 76. The Parliament of the Commonwealth has additional specific power under s 77(ii) to define the extent to which the jurisdiction of any federal court, including the High Court58, is to be exclusive of State jurisdiction. The authority to adjudicate comprised in the conferral of federal jurisdiction is authority to exercise, within the limits permitted by or under s 75, 57 (1907) 4 CLR 1087 at 1142; [1907] HCA 76. See also CGU Insurance Ltd v Blakeley (2016) 90 ALJR 272 at 279 [24]; 327 ALR 564 at 570; [2016] HCA 2. 58 Pirrie v McFarlane (1925) 36 CLR 170 at 176; [1925] HCA 30. Bell NettleJ s 76 or s 77, the judicial power of the Commonwealth, which s 71 provides is to be vested in the High Court, in such other federal courts as the Parliament creates and in such other courts as it invests with federal jurisdiction59. The essential character of judicial power, as has repeatedly been emphasised, stems from the unique and essential function that judicial power performs by quelling controversies about legal rights and legal obligations through ascertainment of facts, application of law and exercise, where appropriate, of judicial discretion60. The character of judicial power, as distinct from the source of the authority of a particular court to adjudicate a particular justiciable controversy, is unaffected by the source of the law that is to be applied to determine the legal rights and legal obligations in controversy. That fundamental point was articulated by Kitto J when he said in Anderson v Eric Anderson Radio & TV Pty Ltd61: "[A]ll that is meant by saying that a court has federal jurisdiction in a particular matter is that the court's authority to adjudicate upon the matter is a part of the judicial power of the federation. To confer federal jurisdiction in a class of matters upon a State court is therefore not, if no more be added, to change the law which the court is to enforce in adjudicating upon such matters; it is merely to provide a different basis of authority to enforce the same law." The point made by Kitto J in Anderson v Eric Anderson Radio & TV Pty Ltd was reiterated by Windeyer J in Felton v Mulligan62 when he said that "[t]he existence of federal jurisdiction depends upon the grant of an authority to adjudicate rather than upon the law to be applied or the subject of adjudication". Having quoted that statement with approval, Mason, Murphy, Brennan and Deane JJ went on to state in Fencott v Muller63: 59 Ah Yick v Lehmert (1905) 2 CLR 593 at 603; [1905] HCA 22; CGU Insurance Ltd v Blakeley (2016) 90 ALJR 272 at 279 [24]; 327 ALR 564 at 571. 60 Fencott v Muller (1983) 152 CLR 570 at 608; [1983] HCA 12. See also South Australia v Totani (2010) 242 CLR 1 at 63 [131]; [2010] HCA 39. 61 (1965) 114 CLR 20 at 30; [1965] HCA 61. 62 (1971) 124 CLR 367 at 393. 63 (1983) 152 CLR 570 at 607. Bell NettleJ "Subject to any contrary provision made by federal law and subject to the limitation upon the capacity of non-federal laws to affect federal courts, non-federal law is part of the single, composite body of law applicable alike to cases determined in the exercise of federal jurisdiction and to cases determined in the exercise of non-federal jurisdiction". Thus, it is commonplace that resolution of a matter within federal jurisdiction may involve application both of Commonwealth law and of State law. Indeed it can happen that a matter in federal jurisdiction is resolved entirely through the application of State law. Application of State law in federal jurisdiction came for a period to be described, "[f]or want of a better term", as "accrued jurisdiction"64. There is "no harm in the continued use of the term 'accrued jurisdiction' provided it be borne in mind ... there [is] but one 'matter'"65. However, the imprecision the term introduces into the word "jurisdiction" means that the term is best avoided. There is but one matter and that matter is entirely within federal jurisdiction, as distinct from State jurisdiction. The simple constitutional truth is that State laws form part of the single composite body of federal and non-federal law that is applicable to cases determined in the exercise of federal jurisdiction in the same way, and for the same reason, as they form part of the same single composite body of law that is applicable to cases determined in the exercise of State jurisdiction – because they are laws. The qualification concerning the limitation on the capacity of non-federal laws to affect federal courts, expressed in Fencott v Muller, was formulated in that case in the specific context of examining the sources of law applicable to the determination of a matter within the federal jurisdiction which had been conferred on a federal court under s 77(i) of the Constitution. The incapacity so identified in that context is a particular manifestation of a more general incapacity of any law enacted other than by the Parliament of the Commonwealth to affect the exercise of federal jurisdiction by any court. That more general incapacity manifests also in the incapacity of a State Parliament to affect the exercise of federal jurisdiction by a State court. 64 Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 at 294; [1983] HCA 65 Houghton v Arms (2006) 225 CLR 553 at 564 [26]-[27]; [2006] HCA 59. Bell NettleJ Incapacity of State law to affect the exercise of federal jurisdiction The incapacity of a State law to affect the exercise of federal jurisdiction by a State court is a manifestation of the general incapacity of any Parliament or legislature other than the Parliament of the Commonwealth to affect the exercise of federal jurisdiction conferred by or conferred or invested under Ch III of the Constitution. That general incapacity stems from the exclusory operation of Ch III explained in the Boilermakers' Case66 and reinforced in Re Wakim; Ex parte McNally67. Having observed that, of the legislative powers enumerated in Ch I, s 51(xxxix) alone mentions the Federal Judicature, Dixon CJ, McTiernan, Fullagar and Kitto JJ said in the Boilermakers' Case68: "Section 51(xxxix) extends to furnishing courts with authorities incidental to the performance of the functions derived under or from Chap III and no doubt to dealing in other ways with matters incidental to the execution of the powers given by the Constitution to the federal judicature. But, except for this, when an exercise of legislative powers is directed to the judicial power of the Commonwealth it must operate through or in conformity with Chap III." Chapter III, according to that orthodox conception, is at once empowering and limiting. The Parliament of the Commonwealth alone has power to vest federal jurisdiction, but has no such power other than that conferred by ss 76 and 77 of the Constitution69. The Parliament of the Commonwealth alone has power to regulate the exercise of federal jurisdiction, but has no such power other than that conferred by s 51(xxxix) of the Constitution. State Parliaments have been recognised to have no power to add to or detract from federal jurisdiction, whether that federal jurisdiction is conferred on 66 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270; [1956] HCA 10. 67 (1999) 198 CLR 511 at 575. 68 (1956) 94 CLR 254 at 269-270. 69 See Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529 at 540; [1955] HCA Bell NettleJ the High Court by s 75 or under s 76 of the Constitution70 or is conferred on another federal court under s 77(i) or invested in a State court under s 77(iii)71. In respect of federal jurisdiction conferred on a federal court under s 77(i) or invested in a State court under s 77(iii), the explanation sometimes given of that inability of a State Parliament to add to or detract from federal jurisdiction has been that it is the result of s 109 of the Constitution72. The better explanation, however, is that it is the result of an absence of State legislative power correlative to the exclusory operation of Ch III of the Constitution73. Just as State Parliaments have no power to add to or detract from federal jurisdiction, State Parliaments have no power to command a court as to the manner of exercise of federal jurisdiction conferred on or invested in that court74. To use the language of s 107 of the Constitution, the entire subject-matter of the conferral and exercise of federal jurisdiction is a subject-matter of legislative power that is, by Ch III of the Constitution, "exclusively vested in the Parliament of the Commonwealth". The existence of that incapacity of a State Parliament to command a State court as to the manner of its exercise of federal jurisdiction is not contradicted by the frequent observation that the Parliament of the Commonwealth must take a State court as found when investing that court with federal jurisdiction under 70 Eg Commissioner of Stamp Duties (NSW) v Owens [No 2] (1953) 88 CLR 168 at 169; [1953] HCA 62; John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 79, 84, 87-88, 93; [1973] HCA 21. 71 Eg The Commonwealth v Rhind (1966) 119 CLR 584 at 599; [1966] HCA 83; British American Tobacco Australia Ltd v Western Australia (2003) 217 CLR 30 at 53-54 [44]-[45]; [2003] HCA 47. 72 Eg Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 35 [41]; [1998] HCA 30. 73 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 618 [20]; [2008] HCA 28, citing APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 405-406 [228]-[230]; [2005] HCA 44. 74 Alqudsi v The Queen (2016) 90 ALJR 711 at 749 [171]; 332 ALR 20 at 67; [2016] HCA 24; R v Todoroski (2010) 267 ALR 593 at 594-595 [8]. Bell NettleJ s 77(iii)75. Observations to that effect have not been directed to the incapacity of a State Parliament to regulate the exercise of federal jurisdiction by a State court. the They have been directed Commonwealth to alter the character or constitution of a State court, invested with federal jurisdiction under s 77(iii), in the exercise of the power conferred by s 51(xxxix)76. the Parliament of incapacity of the The incapacity of a State Parliament to enact a law which governs the exercise of federal jurisdiction by a court, whether it be a federal court or a State court, explains the necessity for s 79 of the Judiciary Act and is the key to understanding the nature and extent of its operation. Section 79 is a law, enacted under s 51(xxxix) of the Constitution, which serves to ensure that the exercise of federal jurisdiction is effective. The section fills a gap in the law governing the actual exercise of federal jurisdiction which exists by reason of the absence of State legislative power. The section fills that gap by picking up the text of a State law governing the exercise of State jurisdiction and applying that text as a Commonwealth law to govern the manner of exercise of federal jurisdiction. The section has no broader operation. To relate that narrow but important operation of s 79 of the Judiciary Act to the text of that section, it is appropriate now to turn to the context of that section and to the history of its interpretation. Judiciary Act Section 79 in context The Judiciary Act, as enacted in 1903, made provision in Pt II for the constitution and operation of the High Court, in Pt IV in relation to its original jurisdiction, and in Pt V in relation to its appellate jurisdiction. Within Pt IV, s 30 conferred original jurisdiction on the High Court under s 76(i) of the Constitution in all matters arising under the Constitution or involving its interpretation. The High Court was not then, and has not since been, conferred with general original jurisdiction under s 76(ii) of the Constitution in matters arising under laws made by the Parliament of the Commonwealth. 75 Eg Peacock v Newtown Marrickville and General Co-operative Building Society No 4 Ltd (1943) 67 CLR 25 at 37; [1943] HCA 13. 76 See generally Russell v Russell (1976) 134 CLR 495 at 516-518; [1976] HCA 23 and the cases there cited. Bell NettleJ Part VI of the Judiciary Act, as enacted, did two things. Under s 77(ii) of the Constitution, it defined the extent to which the jurisdiction of the High Court was to be exclusive of State jurisdiction. Under s 77(iii) of the Constitution, it invested State courts with federal jurisdiction. The former it achieved by a combination of s 38 (providing for the jurisdiction of the High Court to be exclusive of the jurisdiction of State courts in specified categories of matters within the scope of, although not precisely aligning to, the categories of matters referred to in s 75 of the Constitution) and s 39(1) (providing that the jurisdiction of the High Court in matters not mentioned in s 38 was to be exclusive of the jurisdiction of State courts except as provided in s 39(2)). The latter it achieved by s 39(2), which provided that, except as provided in s 38 and subject to specified "conditions and restrictions", State courts were, "within the limits of their several jurisdictions", to be "invested with federal jurisdiction, in all matters in which the High Court has original jurisdiction or in which original jurisdiction can be conferred upon it". Except for changes occasioned by the creation of the Federal Court of Australia, and for changes of drafting style and in the number and formulation of the conditions and restrictions specified in s 39(2), ss 38 and 39 have remained in the form in which they were originally enacted. Section 39(2), insofar as it invests federal jurisdiction in State courts in matters in which the High Court does not have original jurisdiction (made exclusive by ss 38 and 39(1)) but in which original jurisdiction could be conferred on the High Court under s 76 of the Constitution, was considered in Lorenzo v Carey77 to leave open to State courts capacity to exercise State jurisdiction in respect of those matters. That view of the operation of s 39(2) was subsequently doubted78, and was ultimately rejected in Felton v Mulligan79. That rejection was not because it was considered to be constitutionally impermissible for a State court in which federal jurisdiction was invested to retain State jurisdiction with respect to the same matter, but because the attachment of conditions and restrictions to the investiture of federal jurisdiction by s 39(2) manifested a legislative intention to cover the field of jurisdiction with respect to matters within the categories of matters enumerated in s 76 of the Constitution to the exclusion of State jurisdiction. The settled view that has resulted is that, in a 77 (1921) 29 CLR 243 at 251-252; [1921] HCA 58. 78 Ffrost v Stevenson (1937) 58 CLR 528 at 573; [1937] HCA 41. 79 (1971) 124 CLR 367 at 412-413. See Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 479; [1980] HCA 32. Bell NettleJ matter which would otherwise be within the jurisdiction of a State court which answers the description of a matter within s 75 or s 76 of the Constitution, the State court is invested with federal jurisdiction with respect to the matter under s 39(2) to the exclusion of State jurisdiction under s 109 of the Constitution80. Part XI of the Judiciary Act, as enacted, was headed "Supplementary Provisions". The Part contained s 79, together with ss 80 and 81, under the divisional heading "Application of Laws". Section 79 as enacted provided: "The laws of each State, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State in all cases to which they are applicable." Except that it was amended in 1979 to change "State" to "State or Territory"81, and in 2008 to add provisions addressed specifically to State and Territory laws purporting to bind a court exercising federal jurisdiction in actions for recovery of amounts paid in connection with invalid State or Territory taxes82, s 79 has not altered from the form in which it was so enacted in 1903. Background to s 79 and early interpretation The enacted text of s 79 had been a clause in the original form of the Bill for the Judiciary Act, which had been introduced into the House of Representatives in 190183. The clause passed without comment during the protracted parliamentary debates which preceded the enactment of the Bill in final form in 1903. The marginal note to the clause as introduced in 1901, and to the section as enacted in 1903, made reference to s 721 of the United States Revised Statutes, 80 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53]; [2015] HCA 36. 81 Judiciary Amendment Act (No 2) 1979 (Cth), s 14. 82 Judiciary Amendment Act 2008 (Cth), Sched 1, item 2. 83 Judiciary Bill 1901 (Cth), cl 72. Bell NettleJ originally enacted as s 34 of the Judiciary Act 1789 (US). Section 721 of the United States Revised Statutes then provided: "The laws of the several States, except where the Constitution, treaties, or statutes of the United States otherwise require or provide, shall be regarded as rules of decision in trials at common law, in the courts of the United States, in cases where they apply." The interpretation of s 721 of the United States Revised Statutes has had a convoluted and controversial history. On the view of s 721 which prevailed in 1901, its reference to "[t]he laws of the several States" was interpreted as referring only to "state laws, strictly local". Beyond that narrow field of operation, the section was understood to leave open to federal courts the ability to develop and apply a federal common law84. That narrow interpretation of s 721, and correspondingly wide scope for the development by federal courts of a federal common law, would come ultimately to be abandoned by the Supreme Court of the United States in 1938 in Erie Railroad Co v Tompkins85 on the basis in part that it had led to an "unconstitutional assumption of powers by courts of the United States" to formulate "substantive rules of common law" in areas beyond the legislative competence of Congress86. "The laws of the several States" were then and thereafter interpreted as including the decisions of State courts and the notion of a general federal common law was abandoned. Despite a post-Erie suggestion that the section had been "deemed, consistently for over a hundred years, to be merely declaratory of what would in any event have governed the federal courts"87, the question of precisely what s 721 of the United States Revised Statutes did in stating that the State laws to which it referred shall be "regarded as rules of decision" in federal courts does not appear by 1901 to have been squarely addressed in decisions of the Supreme Court. On one view, the section was "no more than a declaration of what the law would have been without it"88. On another, the section itself had the effect of 84 Swift v Tyson 41 US 1 at 18-19 (1842). 86 304 US 64 at 78-79 (1938). 87 Guaranty Trust Co v York 326 US 99 at 103-104 (1945). 88 Hawkins v Barney's Lessee 30 US 457 at 464 (1831). Bell NettleJ making State law within the scope of the section "binding" on a federal court sitting in the State89. Given that lack of clarity about how s 721 of the United States Revised Statutes operated, it is unsurprising that different views would emerge as to the operation of s 79 of the Judiciary Act when this Court first came to consider it in Federated Sawmill, Timberyard and General Woodworkers' Employes' Association (Adelaide Branch) v Alexander90. Griffith CJ described s 79 as a section "which expressly provides (perhaps only by way of declaration) that the laws of each State shall except as otherwise provided by the Constitution or the laws of the Commonwealth be binding on all Courts exercising federal jurisdiction in that State in all causes to which they are applicable"91. Barton J described s 79 rather differently, as a section "in comprehensive terms" under which "Courts exercising federal jurisdiction in any State are, except as otherwise provided by the Constitution or the laws of the Commonwealth, bound by the laws of that State ... in all cases to which such laws are applicable"92. Isaacs J referred to United States case law on s 721 as providing guidance as to the operation of s 7993. Nevertheless, as Dixon J pointed out more than a decade after Erie, in Huddart Parker Ltd v The Ship Mill Hill94, s 79 of the Judiciary Act is expressed in different terms from s 721 of the United States Revised Statutes. Importantly, the reference in s 79 to State laws "binding on ... Courts" is not found in s 721, where the reference is to State laws operating as "rules of decision in ... courts". The language of s 79 is in that respect more tellingly compared, and contrasted in the relative narrowness of its focus, with the reference in covering cl 5 of the Constitution to laws "binding on the courts, judges, and people". 89 Camden and Suburban Railway Company v Stetson 177 US 172 at 174-175 (1900). 90 (1912) 15 CLR 308; [1912] HCA 42. 91 (1912) 15 CLR 308 at 313. 92 (1912) 15 CLR 308 at 316. 93 (1912) 15 CLR 308 at 321, referring to Campbell v Haverhill 155 US 610 (1895); see now DelCostello v International Brotherhood of Teamsters 462 US 151 at 160- 94 (1950) 81 CLR 502 at 507; [1950] HCA 43. Bell NettleJ Important also to the interpretation of s 79 of the Judiciary Act is that the constitutional and statutory setting within which it operates is quite different from that of s 721 of the United States Revised Statutes. Unlike s 721, the courts to which s 79 refers are not limited to federal courts including the High Court (which, despite earlier doubts having been expressed95, Dixon J held in Huddart Parker to be a court to which s 79 applied96). The "autochthonous expedient"97 adopted in s 77(iii) of the Constitution of conferring legislative power on the Parliament of the Commonwealth to invest federal jurisdiction in State courts, and the near comprehensive exercise of that power by the enactment of s 39(2) of the Judiciary Act, means that the courts to which s 79 refers include State courts at all levels of each State court system. In South Australia v The Commonwealth98, Dixon CJ described s 79 of the Judiciary Act as operating to "direct where this Court shall go for the substantive law". That somewhat Delphic statement is perhaps indicative of an inclination to read s 79 in a manner inspired by the Erie reading of s 721 of the United States Revised Statutes99. Although the statement has been quoted with approval in later cases100, the potential reading of s 79 to which it points has not been taken up. Analogy to s 721 of the United States Revised Statutes has implicitly been treated as of little assistance in the interpretation of s 79. The interpretation of s 79 of the Judiciary Act was instead to follow its own difficult path, its exposition plagued at various turns by metaphor and obscurity of language. 95 Lady Carrington Steamship Co Ltd v The Commonwealth (1921) 29 CLR 596 at 601; [1921] HCA 49. 96 (1950) 81 CLR 502 at 507-508. 97 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268. 98 (1962) 108 CLR 130 at 140; [1962] HCA 10. 99 Cf Klaxon Co v Stentor Electric Manufacturing Co Inc 313 US 487 at 496 (1941); Griffin v McCoach 313 US 498 at 503 (1941). 100 Eg Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 587 [57]; [2001] HCA 1. Bell NettleJ Interpretative complications The interpretation of the section was complicated in the long period before Lange v Australian Broadcasting Corporation101 by failure to appreciate that "[t]here is but one common law in Australia which is declared by this Court as the final court of appeal" with the result that "[i]n contrast to the position in the United States, the common law as it exists throughout the Australian States and Territories is not fragmented into different systems of jurisprudence, possessing different content and subject to different authoritative interpretations". The consequence is that there was often a failure to recognise that the reference in s 79 to "[t]he laws of each State" can only meaningfully encompass the statutory laws of each State. There is no common law of a State on which the section could operate. The interpretation of the section has been further complicated throughout its history by uncertainty about the relationship between ss 79 and 80 of the Judiciary Act. Different views emerged as to how s 80 operates and as to how s 79 operates in relation to s 80102. On occasions, the operation of the two sections has been treated as equivalent and on occasions they have been referred to interchangeably or conflated103. No question of the operation of s 80 arises in this appeal, no argument has been directed to s 80 by the parties and interveners, and it is neither necessary nor appropriate to refer further to s 80 in order to explain the operation of s 79 to the extent relevant to the determination of this appeal. 101 (1997) 189 CLR 520 at 563. See also Lipohar v The Queen (1999) 200 CLR 485 at 505 [43]; [1999] HCA 65. 102 The Commonwealth v Mewett (1997) 191 CLR 471 at 492-493, 522, 525, 554-555; [1997] HCA 29. See also John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 529-532 [50]-[58]; [2000] HCA 36; Blunden v The Commonwealth (2003) 218 CLR 330 at 338-339 [16]-[18], 359-360 [91]; [2003] HCA 73; Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 258 [8]-[11]; [2005] HCA 38; Sweedman v Transport Accident Commission (2006) 226 CLR 362 at 402-403 [33]-[34]; [2006] HCA 8. 103 Eg Musgrave v The Commonwealth (1937) 57 CLR 514 at 531, 543, 547; [1937] HCA 87, as noted in John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 531 Bell NettleJ Emergence of the modern interpretation Despite the difficulty of its interpretation, an authoritative articulation of the purpose of s 79 of the Judiciary Act occurred in 1953 when, in Commissioner of Stamp Duties (NSW) v Owens [No 2] ("Owens [No 2]")104, Dixon CJ, Williams, Webb, Fullagar and Kitto JJ identified that purpose as being "to adopt the law of the State where federal jurisdiction is exercised as the law by which, except as the Constitution or federal law may otherwise provide, the rights of the parties to the lis are to be ascertained and matters of procedure are to be regulated"105. What was meant by "adopt", and whether "the law of the State" was meant to refer to the whole or some part of the law of the State, were questions not explored in Owens [No 2]. Later cases were to address both of those questions. From Pedersen v Young106, John Robertson & Co Ltd v Ferguson Transformers Pty Ltd107 and Maguire v Simpson108, two aspects of how s 79 operates to "adopt" those State statutes to which it refers emerged with tolerable clarity. The two aspects are together captured in the statement of Kitto J in the earliest of those cases that s 79 "does not purport to do more than pick up State laws with their meaning unchanged"109. First, s 79 operates to take the text of State law and to apply that text as Commonwealth law110. The expression "surrogate federal law" has sometimes been used to describe the text as so "picked up"111, but the adjective "surrogate" adds nothing to the analysis. Second, s 79 so operating does not alter the meaning of the text of the State law other than to make that text applicable to a federal court exercising jurisdiction in 104 (1953) 88 CLR 168. 105 (1953) 88 CLR 168 at 170. 106 (1964) 110 CLR 162; [1964] HCA 28. 107 (1973) 129 CLR 65. 108 (1977) 139 CLR 362; [1977] HCA 63. 109 Pedersen v Young (1964) 110 CLR 162 at 165. 110 Eg Pedersen v Young (1964) 110 CLR 162 at 165. 111 Solomons v District Court (NSW) (2002) 211 CLR 119 at 134 [20]-[21]; [2002] HCA 47. Bell NettleJ the State even though the State law on its proper construction applies only to a State court112. Just on which laws of a State the section will operate in that way to apply their text as a Commonwealth law was squarely addressed in Solomons v District Court (NSW). Following on from Australian Securities and Investments Commission v Edensor Nominees Pty Ltd ("Edensor")113, to the detail of which it will be necessary later to return, Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ drew attention in Solomons to a number of limitations explicit in the text of s 79114: "First, the section operates only where there is already a court 'exercising federal jurisdiction', 'exercising' being used in the present continuous tense. Secondly, s 79 is addressed to those courts; the laws in question 'shall ... be binding' upon them. The section is not, for example, directed to the rights and liabilities of those engaged in non-curial procedures under State laws. Thirdly, the compulsive effect of the laws in question is limited to those 'cases to which they are applicable'. To that it may be added, fourthly, the binding operation of the State laws is 'except as otherwise provided by the Constitution'." Section 79 was held in Solomons to have no application to State laws which are not "binding" on State courts, and for that reason (amongst others) to be inapplicable in that case to apply as Commonwealth law provisions of State legislation which imposed obligations on the State and on State executive officers. Quite what is encompassed within s 79's description of State laws that are "binding" on a court is to some extent elucidated by the section's express inclusion of "laws relating to procedure, evidence, and the competency of witnesses". It would be wrong, however, to seek to delimit the scope of the section's operation by invoking the difficult and sometimes elusive distinction 112 Eg The Commonwealth v Mewett (1997) 191 CLR 471 at 556; Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136 at 143 [15]; [2000] HCA 39. 113 (2001) 204 CLR 559. 114 (2002) 211 CLR 119 at 134 [23]. See also British American Tobacco Australia Ltd v Western Australia (2003) 217 CLR 30 at 60 [68]. Bell NettleJ between "substance" and "procedure"115. It would also be wrong to seek to delimit the section's operation by conceiving of a statute that is binding on a court as a statute which cannot also be binding on a person whose rights or obligations are to be determined by that court. As Dixon J commented in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett116, it "is not unusual to find that statutes impose liabilities, create obligations or otherwise affect substantive rights, although they are expressed only to give jurisdiction or authority, whether of a judicial or administrative nature". More useful in delimiting the scope of operation of s 79 is the basic distinction between the "jurisdiction" of a court, in the precise and technical sense in which that term is used in Ch III in referring to federal jurisdiction and distinguishing it from State jurisdiction, and a "power" that a court is required or permitted to exercise in the execution of jurisdiction117. Drawing that distinction, in a passage later quoted with approval by Gleeson CJ, Gaudron and Gummow JJ in Edensor118, Toohey J said in Harris v Caladine119: "The distinction between jurisdiction and power is often blurred, particularly in the context of 'inherent jurisdiction'. But the distinction may at times be important. Jurisdiction is the authority which a court has to decide the range of matters that can be litigated before it; in the exercise of that jurisdiction a court has powers expressly or impliedly conferred by the legislation governing the court and 'such powers as are incidental and necessary to the exercise of the jurisdiction or the powers so conferred'". 115 Cf John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 542-543 [97]. 116 (1945) 70 CLR 141 at 165-166; [1945] HCA 50. See also Hooper v Hooper (1955) 91 CLR 529 at 535-536; [1955] HCA 15; Mayne v Jaques (1960) 101 CLR 169 at 171; [1960] HCA 23; Byrnes v The Queen (1999) 199 CLR 1 at 22-23 [37]-[38]; [1999] HCA 38. 117 CGU Insurance Ltd v Blakeley (2016) 90 ALJR 272 at 281 [31]; 327 ALR 564 at 118 (2001) 204 CLR 559 at 590 [64]. 119 (1991) 172 CLR 84 at 136; [1991] HCA 9. Bell NettleJ Drawing the same distinction between "jurisdiction" and "power" in PT Bayan Resources TBK v BCBC Singapore Pte Ltd120, after referring to the primary signification of "inherent jurisdiction" as "the power inhering in a superior court of record administering law and equity to make orders of a particular description", French CJ, Kiefel, Bell, Gageler and Gordon JJ (with whom Keane and Nettle JJ agreed) pointed out that "[t]he question of the scope of the inherent power of [a] Supreme Court to make orders of a particular description is distinct from the question of whether or not the authority of the Supreme Court to adjudicate on a particular exercise of its inherent power is within the 'federal jurisdiction' invested in the Supreme Court by s 39(2) of the Judiciary Act or by another Commonwealth law enacted under s 77(iii) of the Constitution"121. Their Honours described the exercise of inherent power by the Supreme Court of Western Australia to make a freezing order in relation to a prospective judgment which would be registrable under the Foreign Judgments Act 1991 (Cth) as "regulated" by O 52A r 5 of the Rules of the Supreme Court 1971 (WA), which were made under the Supreme Court Act 1935 (WA) "and relevantly applied by s 79 of the Judiciary Act"122. "Characteristically an exercise of jurisdiction is attended by an exercise of power"123. By making State laws that are "binding" on courts also binding on courts exercising federal jurisdiction, s 79 of the Judiciary Act takes the text of State laws conferring or governing powers that State courts have when exercising State jurisdiction and applies that text as Commonwealth law to confer or govern powers that State courts and federal courts have when exercising federal jurisdiction. Forge v Australian Securities and Investments Commission124 is an example. That case concerned ss 232, 243ZE and 1317EA of the Corporations Law (NSW) as continued in force by s 1473 of the Corporations Law (NSW) and applied by s 7 of the Corporations (New South Wales) Act 1990 (NSW) as a law 120 (2015) 258 CLR 1 at 17-18 [38]. 121 (2015) 258 CLR 1 at 18 [39]. See also at (2015) 258 CLR 1 at 22 [57]. 122 (2015) 258 CLR 1 at 10 [2]. 123 Re Nolan; Ex parte Young (1991) 172 CLR 460 at 487; [1991] HCA 29; Edensor (2001) 204 CLR 559 at 590 [65]. 124 (2006) 228 CLR 45 at 90-91 [112]; [2006] HCA 44. Bell NettleJ of New South Wales. Sections 232 and 243ZE each prohibited certain conduct. Section 1317EA empowered the Supreme Court of New South Wales to make civil penalty orders if satisfied that a person had engaged in conduct which contravened either of those prohibitions. Citing Edensor, Gummow, Hayne and Crennan JJ (with whom Gleeson CJ, Callinan and Heydon JJ relevantly agreed)125 explained s 79 of the Judiciary Act as operating to "pick up" and apply s 1317EA to the Supreme Court of New South Wales when exercising federal jurisdiction under s 39(2) of the Judiciary Act. Their Honours described s 1317EA in that context as a provision conferring a "power ... to grant remedies". Tellingly, their Honours did not suggest that s 79 was needed to, or did, operate to "pick up" either s 232 or s 243ZE. Other examples derived from the cases of laws within the purview of s 79 of the Judiciary Act include laws: which regulate the procedure of the court126; which limit the court's powers to compel production of documents or disclosure of information127; which bar the court absolutely or conditionally by reason of effluxion of time from entertaining a claim128; which require or permit the court to stay a proceeding where there has been a submission to arbitration129; and which confer authority on the court in specified circumstances to make orders conferring or declaring or altering rights or status130. That list is indicative, not exhaustive. 125 (2006) 228 CLR 45 at 90-91 [112]. See also at 56 [4], 136 [237], 150 [278]. 126 Eg Bainbridge-Hawker v Minister of State for Trade and Customs (1958) 99 CLR 521 at 536-537; [1958] HCA 60; Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 265 [39]; CGU Insurance Ltd v Blakely (2016) 90 ALJR 272 at 277 [12]; 327 ALR 564 at 568. 127 Eg Northern Territory v GPAO (1999) 196 CLR 553 at 586-589 [76]-[85], 606 [135], 650 [254]; [1999] HCA 8. 128 Eg Federated Sawmill, Timberyard and General Woodworkers' Employes' Association (Adelaide Branch) v Alexander (1912) 15 CLR 308; Bate v International Computers (Aust) Pty Ltd (1984) 2 FCR 526. 129 Eg Huddart Parker Ltd v The Ship Mill Hill (1950) 81 CLR 502 at 507-508. 130 Eg R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 330; [1957] HCA 18; Coshott v Prentice (2014) 221 FCR 450 at 457 [20], 476 [116]. Bell NettleJ Confining the operation of s 79 to the area of incapacity of State law to affect the exercise of federal jurisdiction Relating the purpose identified in Owens [No 2] to the limitation on State legislative power which arises from the exclusory operation of Ch III of the Constitution allows the class of State laws on which s 79 operates to be delineated with more precision131. The purpose is fulfilled by aligning s 79's description of State laws as "binding" on courts with the gap in the law governing the exercise of federal jurisdiction which exists absent other applicable Commonwealth law by reason of the absence of State legislative power to govern what a court does in the exercise of federal jurisdiction. That is how it should be read. That alignment brings s 79 comfortably within the ambit of the legislative power conferred on the Parliament of the Commonwealth by s 51(xxxix) of the Constitution132. Filling the gap in which State law cannot govern the exercise of federal jurisdiction by a federal court or a State court, by doing no more than applying as Commonwealth law with its meaning unchanged the text of State law governing the exercise of State jurisdiction, s 79 goes no further than is reasonably necessary "to facilitate the particular exercise of federal jurisdiction by the application of a coherent body of law, elements in which may comprise the laws of the State or Territory in which the jurisdiction is being exercised, together with the laws of the Commonwealth, but subject always to the overriding effect of the Constitution itself"133. Whether, and if so to what extent, s 51(xxxix) of the Constitution might extend to permit the whole or some part of that gap to be filled by a Commonwealth law having a different operation is a question which does not now arise for determination. The resulting confinement of the operation of s 79 to an area in which there is an absence of State legislative power also provides a straightforward answer to the vexed question of the relationship between s 79 of the Judiciary Act and s 109 of the Constitution134. Within the field in which s 79 of the 131 Cf APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 406 132 Edensor (2001) 204 CLR 559 at 587 [57], 591 [68]. 133 Northern Territory v GPAO (1999) 196 CLR 553 at 588 [80]; see also at 576 [38]. 134 Cf Northern Territory v GPAO (1999) 196 CLR 553 at 576 [38], 586 [76]; Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 271 [61]-[63]. Bell NettleJ Judiciary Act operates, State laws have no valid application and s 109 of the Constitution for that reason simply has no operation. Some cases Mr Rizeq relies on statements made in a number of High Court cases to support his argument. Some of those cases contain statements which, read in isolation, are capable of being interpreted as providing him with some support. On analysis, however, none of the cases on which he relies departs from the understanding of the constitutional structure or of the scope and operation of s 79 of the Judiciary Act that has been explained. The outcome of each, and the thrust of the reasoning in each, conforms to that explanation. That proposition can be made good by examining the cases in chronological order. R v Oregan; Ex parte Oregan was a custody suit between residents of different States commenced in the original jurisdiction of the High Court under s 75(iv) of the Constitution. The suit was heard by Webb J sitting in Victoria. His Honour referred to the effect of s 79 of the Judiciary Act as being that "the Victorian statute law relating to the custody of infants is binding on this Court when sitting in Victoria; but only in cases in which the laws of Victoria are applicable"135. The Victorian statute law which his Honour went on to identify and apply comprised provisions of the Supreme Court Act 1928 (Vic) and of the Marriage Act 1928 (Vic), all of which were directed to the powers of a State court to make orders concerning the welfare and custody of children. Parker v The Commonwealth136 was an action against the Commonwealth for compensation to relatives of a naval seaman who had been killed in a collision on the high seas. The action was commenced in the original jurisdiction of the High Court under s 76(iii) of the Constitution and was heard by Windeyer J sitting in Victoria. The parties were agreed that the law to be applied was to be found in the provisions of the Wrongs Act 1958 (Vic) corresponding to the Fatal Accidents Act 1846 (9 & 10 Vict c 93), which in its terms applied only to events having occurred in Victoria, on the basis that that was the result of the application either of the applicable common law choice of law rule or of s 80 of the Judiciary Act. The availability of either or both of those pathways to the 135 (1957) 97 CLR 323 at 330. 136 (1965) 112 CLR 295; [1965] HCA 12. Bell NettleJ application of the Wrongs Act is not to the present point. What is to the point is that, the provisions of the Wrongs Act having been rendered applicable, s 79 of the Judiciary Act applied to govern the assessment and apportionment of compensation by the High Court in the manner set out in those provisions. Edensor137, to which reference has already been made, involved a number of applications to the High Court including for special leave to appeal from a decision of the Full Court of the Federal Court. The Federal Court at first instance had found on application by the Australian Securities and Investments Commission that certain conduct contravened the prohibition in s 615 of the Corporations Law (Vic), being the law applied by s 7 of the Corporations (Victoria) Act 1990 (Vic) as a law of Victoria. Having made declarations to that effect, the Federal Court at first instance had gone on to make remedial orders within the scope of the powers conferred on the Supreme Court of Victoria by ss 737 and 739 of the Corporations Law (Vic). The Full Court had held on appeal that those remedial orders were invalid for want of jurisdiction. Granting special leave to appeal to the Australian Securities and Investments Commission and allowing the appeal, the High Court by majority (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ, Kirby J dissenting) held the application to the Federal Court by the Australian Securities and Investments Commission to have been within the federal jurisdiction conferred on the Federal Court under s 77(i) of the Constitution by s 39B(1A)(a) of the Judiciary Act and that the powers conferred on the Supreme Court of Victoria by ss 737 and 739 of the Corporations Law (Vic) were rendered applicable by force of s 79 of the Judiciary Act to the Federal Court in the exercise of that federal jurisdiction. No part of the reasoning of the majority in Edensor was directed to the status of the prohibition in s 615 of the Corporations Law (Vic). The true position is that s 615 of the Corporations Law (Vic) was beyond the scope of s 79 of the Judiciary Act. Section 615 of the Corporations Law (Vic) applied to prohibited conduct as a law of Victoria and its status as a law of Victoria applicable to that conduct was unaffected by the invocation of federal jurisdiction under s 39B(1A)(a) of the Judiciary Act. The declaration of its contravention as a law of Victoria was within the power conferred on the Federal Court in the exercise of that federal jurisdiction by s 21 of the Federal Court of Australia Act 1976 (Cth). 137 (2001) 204 CLR 559. Bell NettleJ Austral Pacific Group Ltd (In liq) v Airservices Australia was an appeal to the High Court from a decision of the Court of Appeal of the Supreme Court of Queensland. The Court of Appeal had held that a manufacturer of equipment who had been sued for damages in negligence and under the Trade Practices Act 1974 (Cth) in the District Court of Queensland was precluded by the operation of s 44(1) of the Safety, Rehabilitation and Compensation Act 1988 (Cth) from having any right to claim contribution under ss 6 and 7 of the Law Reform Act 1995 (Q) from Airservices Australia, a body established under the Air Services Act 1995 (Cth), which was the successor to the assets and liabilities of the plaintiff's employer, the Civil Aviation Authority established under the Civil Aviation Act 1988 (Cth). The High Court dismissed the appeal, unanimously affirming the decision of the Court of Appeal. Noting that the contrary had not been argued, Gleeson CJ, Gummow and Hayne JJ stated that it was to be assumed that the District Court had been exercising federal jurisdiction conferred on it by s 39(2) of the Judiciary Act on the basis that the claim against the manufacturer was a matter arising under the Trade Practices Act within s 76(ii) of the Constitution and on the further basis that Airservices Australia answered the description of "the Commonwealth" so as to bring the matter, as a result of the manufacturer's claim for contribution against Airservices Australia, also within s 75(iii) of the Constitution138. Again noting that the contrary had not been argued, their Honours stated that it was to be assumed that s 79 of the Judiciary Act operated to apply ss 6 and 7 of the Law Reform Act in the exercise of the District Court's federal jurisdiction unless a law of the Commonwealth "otherwise provided"139. Section 44(1) of the Safety, Rehabilitation and Compensation Act was held to be such a law. The right of a tortfeasor to recover contribution from another tortfeasor under s 6 of the Law Reform Act is a right to such amount of contribution as a court might find to be "just and equitable" in the exercise of the power conferred on the court by s 7 of the Law Reform Act. The s 6 right is inseparable from the s 7 power140. Neither is therefore capable of applying in federal jurisdiction as State law. Both are within the field of operation of s 79 of the Judiciary Act. 138 (2000) 203 CLR 136 at 141-142 [9]-[11]. 139 (2000) 203 CLR 136 at 142-143 [12]. 140 Cf James Hardie & Coy Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53 at 64 [22]- [24]; [1998] HCA 78. Bell NettleJ Macleod v Australian Securities and Investments Commission141 arose out of convictions entered by the Court of Petty Sessions at Perth for offences against provisions of the Corporations Law (WA), being the law applied by s 7 of the Corporations (Western Australia) Act 1990 (WA) as a law of Western Australia. The prosecution had been brought by the Australian Securities Commission established under the Australian Securities Commission Act 1989 (Cth). The convictions were set aside on appeal to a single justice of the Supreme Court under s 185 of the Justices Act 1902 (WA). The Australian Securities Commission, having been respondent to that appeal, applied for leave to appeal to the Full Court of the Supreme Court of Western Australia under s 206A of the Justices Act. The Full Court granted leave and allowed the appeal. The High Court unanimously allowed an appeal from the decision of the Full Court on the basis that the making of the application under s 206A of the Justices Act was beyond the power conferred on the Australian Securities Commission by s 49(2) of the Australian Securities Commission Act to "cause a prosecution ... to be begun and carried on". Accepting that the Australian Securities Commission answered the description of "the Commonwealth" so as to make the application under s 206A of the Justices Act a matter within s 75(iii) of the Constitution in respect of which the Supreme Court of Western Australia had federal jurisdiction under s 39(2) of the Judiciary Act, the High Court rejected a submission by the Commonwealth Director of Public Prosecutions that s 79 of the Judiciary Act supplied the deficiency in the statutory power of the Australian Securities Commission by "picking up" the full ambit of s 206A142. In Macleod, Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ specifically referred to the offences in respect of which convictions had been entered by the Court of Petty Sessions as offences against the law of Western Australia143. That was so despite the Court of Petty Sessions, no less than the Supreme Court, having been exercising federal jurisdiction under s 39(2) of the Judiciary Act. Conclusion Within the limits of State legislative capacity, State laws apply in federal jurisdiction as valid State laws unless and to the extent that they are rendered 141 (2002) 211 CLR 287; [2002] HCA 37. 142 (2002) 211 CLR 287 at 302 [44]. 143 (2002) 211 CLR 287 at 291 [1]. Bell NettleJ invalid by reason of inconsistency with Commonwealth laws. What State laws relevantly cannot do within the limits of State legislative capacity is govern the exercise by a court of federal jurisdiction. A State law can determine neither the powers that a court has in the exercise of federal jurisdiction nor how or in what circumstances those powers are to be exercised. A State law cannot in that sense "bind" a court in the exercise of federal jurisdiction, and that is the sense in which that word is used in s 79 of the Judiciary Act. The operation of s 79 is limited to making the text of the State laws of that nature apply as Commonwealth law to bind a court in the exercise of federal jurisdiction. jurisdiction Section 114(2) of the Criminal Procedure Act, governing what is to be taken to be the verdict of a jury, is a useful illustration. Its application to a the Western Australian court exercising federal competence of the Parliament of Western Australia. Consistently with the prescription in s 7 of the Interpretation Act 1984 (WA) that every written law of Western Australia is to be construed "subject to the limits of the legislative power of the State", s 114(2) is properly interpreted as applying to a Western Australian court only when exercising Western Australian jurisdiction. The text of s 114(2) is applied, as Commonwealth law, to a Western Australian court when exercising federal jurisdiction through the operation of s 79 of the Judiciary Act, except as otherwise provided by the Constitution or by some other Commonwealth law. That is what occurred in the trial of Mr Rizeq, there being no provision of the Constitution or of other Commonwealth law preventing it. is beyond Section 6(1)(a) of the Misuse of Drugs Act, in contrast, is a law having application independently of anything done by a court. It is squarely within State legislative competence and outside the operation of s 79 of the Judiciary Act. It applied in the trial of Mr Rizeq as Western Australian law just as it applied to him before any court was called upon to exercise jurisdiction in relation to the The appeal must be dismissed. 144 Cf Solomons v District Court (NSW) (2002) 211 CLR 119 at 134 [23]. Edelman Introduction The circumstances of, and background to, this appeal are described in the joint judgment. The central issue is the construction of s 79(1) of the Judiciary Act 1903 (Cth). The appellant was tried in Western Australia for two offences under s 6(1)(a) of the Misuse of Drugs Act 1981 (WA). Since he was not a resident of Western Australia, his trial, prosecuted by the State of Western Australia, was in federal jurisdiction145. He was convicted of each offence by a guilty verdict of 11 of the 12 jurors. The Criminal Procedure Act 2004 (WA) permitted a conviction without unanimity of the jurors. The appellant submitted that unanimity was required because s 80 of the Constitution requires a the unanimous verdict Commonwealth"146. He submitted that his trial was for offences against a law of the Commonwealth because his trial was in federal jurisdiction, so s 6(1)(a) of the Misuse of Drugs Act could only apply if it was "picked up" as a law of the Commonwealth by s 79(1) of the Judiciary Act. trial of an "offence against any law of in a The Court of Appeal of the Supreme Court of Western Australia held that s 79(1) of the Judiciary Act did not "pick up" s 6(1)(a) of the Misuse of Drugs Act. The appellant submitted that this conclusion was an error. The appeal to this Court can only be allowed if the appellant's construction of s 79(1) is accepted. The appellant's construction, which I describe as the first construction, has significant support in a number of decisions of this Court. However, none of those decisions explore any of the relevant alternative constructions of s 79(1). There are at least four possible constructions of s 79(1) of the Judiciary Act, two of which are viable alternatives to the first construction. In these reasons I describe these two viable alternatives as the second and third constructions. The difference between these alternatives was not explored in written or oral argument. Some of the submissions of the respondent and the interveners were more consistent with the second construction. Some were more consistent with the third. Each of the first three constructions is based upon a different assumption. Those assumptions are broadly as follows. The first construction assumes that all laws in federal jurisdiction must be federal laws. The second construction assumes that all courts exercising federal jurisdiction are effectively federal courts. The third construction assumes only that all authority by which courts 145 Constitution, s 75(iv). 146 Cheatle v The Queen (1993) 177 CLR 541; [1993] HCA 44. Edelman exercise federal jurisdiction is federal authority. Of these three constructions, the first requires s 79(1) to have the broadest operation and the third requires the narrowest operation. It is not necessary in these reasons to reach a final conclusion about which of the second or third constructions should be preferred because, on balance, after taking into account the strength of authority in support of the first construction, I consider that each should be preferred to the first construction, which is the construction that the appellant advanced. However, in circumstances in which the reasons of the other members of the Court in this appeal adopt the second construction, I explain in these reasons why the second construction presents significant obstacles and, if submissions had been made on the point and it were necessary to decide, why I would adopt the third construction. In any event, all members of the Court have concluded that the appellant's construction cannot be accepted. The appeal must be dismissed. Four constructions of s 79(1) of the Judiciary Act Section 79(1) of the Judiciary Act provides: "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." With the exception of the addition of the reference to a Territory in 1979147, s 79(1) has remained unamended over the 114 years of its existence. It has been relied upon in many cases in this Court. Yet, there still remains considerable doubt about what is meant by "[t]he laws of each State or Territory". It is well established that since there is only one common law of Australia, the "laws of each State or Territory" can refer only to statute law. There is no issue in this appeal concerning the application of State or Territory laws in federal courts by s 79(1). The focus of the appeal, and these reasons, is only upon the relationship between two of the types of jurisdiction or authority exercised by State courts, being State and federal jurisdiction. Other sources of jurisdiction, and the particular issues concerning Territory courts, can be put to one side. The issue in this appeal, and the doubt concerning the meaning of the "laws of each State or Territory", arises when s 79(1) is needed to apply State statutory laws to State courts exercising federal jurisdiction. There are, at least, 147 Judiciary Amendment Act (No 2) 1979 (Cth), s 14. Edelman four possible constructions available. They are summarised in broad detail below. The first construction The first construction is that the laws to which s 79(1) refers are all the statutory laws of a State. This is the broadest construction available. On this construction, when a State court exercises federal jurisdiction, s 79(1) operates to make binding all the laws of that State, except as otherwise provided by the Constitution or the laws of the Commonwealth. Subject to that exception, all putative laws of that State become Commonwealth laws in federal jurisdiction. This first construction was advanced by the appellant. Unless the appellant can establish this construction the appeal cannot succeed. This Court unanimously rejects the first construction in this appeal. The second construction The second construction is that the laws to which s 79(1) refers are those statutory laws which confer powers on courts or which govern or regulate a court's powers. This is the construction adopted on this appeal in the other judgments of this Court. As to the conferral of powers, the second construction assumes that in the absence of s 79(1) a State court has no operative powers when the source of its authority to decide is federal. Section 79(1) is needed, on the second construction, to confer every power upon the State court in such cases. Except as otherwise provided by the Constitution or the laws of the Commonwealth, s 79(1) would, on this construction, confer power upon a State court to make orders including the granting of declarations, the making of any interlocutory and final orders, and the imposition of penalties and sentences. On this construction, s 79(1) would not be needed for a State law which created a duty or liability but did not confer any power on a State court. Hence, s 79(1) would not be needed for, and would not apply to, a State law which created an obligation not to traffick a drug of dependence. But there may be difficulties on this construction with the application of s 79(1) to a law, drafted as a single State law148, which provides that a person is liable for 15 years' imprisonment for trafficking in a drug of dependence. Assuming, as this construction does, that the provision for a sentence of up to 15 years' imprisonment can be understood as a law binding on a court, the difficulty is that the single provision creates the duty not to traffick and confers a power for the court to impose the particular sentence. It may be that, on this construction, s 79(1) could not apply to the latter without application to the former. There 148 See Momcilovic v The Queen (2011) 245 CLR 1 at 34 [13]; [2011] HCA 34. Edelman might also be difficulty even if the trafficking law and the power of the court are contained in separate provisions if those separate provisions are seen as practically "inseparable"149. Another difficulty that arises from the inclusion of conferral of powers in this construction is the applicable law for federal jurisdiction. This difficulty arises because this construction would mean that only legal obligations, but not applicable orders, could be imposed upon a litigant in one State court by the statute law of a different State. As to the governing or regulation of powers, on the second construction s 79(1) applies to the statutory laws which govern or regulate the court's authorisation to exercise power. This includes laws regulating the territory, persons, and subject matter over which the power is exercised. Examples of laws concerning regulation of the exercise of authority over persons include laws concerning standing or the joinder of parties. Examples concerning the regulation of the court's authority over the subject matter are laws which bar the exercise of authority over that subject matter after the lapse of a period of time, or laws concerning procedure or evidence in the course of adjudicating over that subject matter. The third construction The third construction is that the laws to which s 79(1) refers are only those statutory laws which govern or regulate the powers that a court (in this case, a State court) exercises as part of its authority to decide. This construction recognises that an assumption underlying s 79(1) is that power is already vested in courts exercising federal jurisdiction. When the authority to exercise that power becomes federal then it is federal law which must regulate the exercise of that power. But the State court's power is not removed and replaced with a new federal power. Authority to decide (ie jurisdiction) is an authorisation to exercise power. To be "exercising federal jurisdiction" is to be exercising power where the source of the authority to do so is federal. On the third construction, the power being exercised need not itself derive from a federal source, although the authority to exercise it would be federal. For instance, a source of power can be a combination of State laws which create duties and State laws which enable courts to enforce those duties. Laws which are "binding on ... Courts" that are "exercising" federal jurisdiction are laws concerned with the authorisation to exercise that existing power. They are laws which govern or regulate the exercise of existing power (including existing, but newly created, power). This 149 See [100] of the joint judgment, and Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136; [2000] HCA 39 discussed below at Edelman construction therefore draws a fundamental distinction between (i) laws which regulate the authority to decide of a court which has existing powers, and (ii) laws which are concerned with the conferral of powers that a court might exercise. The basic distinction is between jurisdiction, or authority to exercise power, and the power itself. The fourth construction The fourth possible construction is that the laws to which s 79(1) refers are laws concerning procedure rather than substantive laws. The fourth construction was adopted by the Court of Appeal of the Supreme Court of Western Australia in this case150. This construction had some support in early decisions of this Court. For example, in Lady Carrington Steamship Co Ltd v The Commonwealth151, Higgins J interpreted s 79 as applying only to procedural laws, which led to his doubt "as to the applicability of sec 79 of the Judiciary Act to the High Court at all" because the procedure of the High Court was governed by the High Court Procedure Act 1903 (Cth). However, the view that s 79 should be confined to matters of procedure has subsequently been rejected152. The distinction introduces an unnecessary gloss upon the statutory language. On appeal to this Court, no party or intervener supported the fourth construction. The methodology and structure of these reasons As to the first three constructions, it is impossible to reconcile all of the reasoning in the various judgments in this Court in cases concerning s 79(1). It is possible to point to reasoning in this Court which supports any of them; although the majority of cases assume that the construction to be applied is the first construction. It is also difficult to identify any case which would be decided differently once, as I explain below, it is accepted that State laws which do not fall within s 79(1) will usually apply of their own force. Indeed, some decisions simply relied upon the relevant State law operating either by its own force or through the effect of s 79. In Pedersen v Young153, Kitto J said that the "received opinion as to the operation of ss 79 and 80" was that "subject to the Constitution and to the laws of the Commonwealth, all Queensland laws must be treated as binding in this Court, as federal law if not by their own force" (emphasis added). 150 Hughes v Western Australia (2015) 299 FLR 197 at 218 [145]. 151 (1921) 29 CLR 596 at 601; [1921] HCA 49. 152 Maguire v Simpson (1977) 139 CLR 362 at 370 per Barwick CJ; [1977] HCA 63; Solomons v District Court of New South Wales (2000) 49 NSWLR 321 at 324 [11] per Mason P, 344 [81] per Foster AJA. 153 (1964) 110 CLR 162 at 165; [1964] HCA 28. Edelman Since the reasoning in most previous cases cannot be determinative, the issue in this appeal must be approached as a matter of principle and with an eye to consistency with the results of previous cases. The remainder of these reasons is divided as follows: The fundamental distinction between "jurisdiction" and "power" The scheme of ss 38 and 39 of the Judiciary Act The need for s 79(1) of the Judiciary Act The text and context of s 79(1) of the Judiciary Act The history of s 79 of the Judiciary Act Authorities supporting the first construction Reasons to prefer the third construction The text, context, and purpose of s 79(1) support the third construction Constitutional restrictions on power favour the third construction Applicable law principles favour the third construction Conclusion A. The fundamental distinction between "jurisdiction" and "power" The essence of the distinction between the second and third constructions of s 79(1) turns upon the fundamental distinction between "jurisdiction" and "power". In 1824, Du Ponceau, whose writing was influential in the development of United States federal law jurisprudence, explained that the term "jurisdiction" has been used in a general sense to mean power as well as in a "more limited sense"154: "Jurisdiction, in its most general sense, is the power to make, declare, or apply the law; when confined to the judiciary department, it is 154 Du Ponceau, A Dissertation on the Nature and Extent of the Jurisdiction of the Courts of the United States, (1824) at 21. Edelman what we denominate the judicial power. It is the right of administering justice through the laws, by the means which the laws have provided for that purpose. In its more limited sense, which is that in which we are now viewing it, it is still the judicial power; but considered in relation to its extent and to the subjects which it embraces or upon which it acts." (emphasis in original) The first, "general", meaning to which Du Ponceau referred was the powers that a court might exercise. The second, "limited", meaning was the authority to adjudicate (and therefore authority to exercise those powers). The difference between these two central meanings of jurisdiction has been important in the development of Australian jurisprudence. The Constitution and the Judiciary Act generally use the word "jurisdiction" in its "more limited" sense, preferring the word "power" for the broader sense. As Isaacs J said in Baxter v Commissioners of Taxation (NSW)155, speaking of the reference to "jurisdiction" in s 39 of the Judiciary Act and s 77(ii) of the Constitution, the word "signifies in this connection authority to adjudicate". Federal jurisdiction, as "jurisdiction derived from a federal source"156, signifies the exercise of an authority to decide which has a federal source. More than 80 years after Isaacs J enunciated this point in Baxter v Commissioners of Taxation (NSW), in a now commonly quoted passage in Harris v Caladine157, Toohey J described jurisdiction as the authority to decide the range of matters that can be litigated before a court, contrasting it with the powers that can be exercised in deciding such matters (the broader, general sense of jurisdiction). Hence, as Toohey J explained in Jackson v Sterling Industries Ltd158, where the issue concerns "the power of the Court to make the orders it did" then the question is one of power, not jurisdiction. Jurisdiction, in the sense of an authority to adjudicate, has a number of dimensions, as Du Ponceau recognised. It has a geographic dimension ("over which territory does the authority to exercise power extend?"); a personal dimension ("over which persons does the authority to exercise power extend?"); 155 (1907) 4 CLR 1087 at 1142; [1907] HCA 76. 156 Dixon, "The Law and the Constitution", (1935) 51 Law Quarterly Review 590 at 157 (1991) 172 CLR 84 at 136; [1991] HCA 9. Quoted with approval in Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 590 [64]; [2001] HCA 1. 158 (1987) 162 CLR 612 at 627-628; [1987] HCA 23. Edelman and a subject matter dimension ("over which subject matters does the authority to exercise power extend?"). As for power, the power exercised within the authority to decide is the power "to make, declare, or apply the law"159 by an act of the court. It is sometimes said that in federal jurisdiction an "immediate right, duty or liability" is established "by the determination of the Court"160. However, it will often be more accurate to say that the exercise of power gives effect to a right, duty or liability because in many cases the right, duty or liability exists before the determination of the court gives effect to it. Jurisdiction, in the sense of an authority to decide, is related to power because power is usually exercised in the course of an authority to decide. The fundamental point is that, as French CJ, Gummow and Bell JJ said in Osland v Secretary to Department of Justice [No 2]161, "[t]he distinction between jurisdiction and power has been made repeatedly in this Court". The distinction between the authority to decide and the power to make orders in the exercise of that authority is consistent with the broad and general definition of judicial power given by Griffith CJ, 108 years ago, in Huddart, Parker & Co Pty Ltd v Moorehead162 and cited on many occasions since. The Chief Justice said: "I am of opinion that the words 'judicial power' as used in sec 71 of the Constitution mean the power which every sovereign authority must of necessity have to decide controversies between its subjects, or between itself and its subjects, whether the rights relate to life, liberty or property. The exercise of this power does not begin until some tribunal which has power to give a binding and authoritative decision (whether subject to appeal or not) is called upon to take action." Jurisdiction is concerned with the subject matter, persons, and territory over which the "binding and authoritative decision" can be given. The exercise 159 Du Ponceau, A Dissertation on the Nature and Extent of the Jurisdiction of the Courts of the United States, (1824) at 21. 160 In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; [1921] HCA 20. 161 (2010) 241 CLR 320 at 332 [19] fn 49; [2010] HCA 24. 162 (1909) 8 CLR 330 at 357; [1909] HCA 36. Edelman of judicial power about which Griffith CJ spoke involves not merely the making of orders but163: "involves, as a general rule, a decision settling for the future, as between defined persons or classes of persons, a question as to the existence of a right or obligation, so that an exercise of the power creates a new charter by reference to which that question is in future to be decided as between those persons or classes of persons. In other words, the process to be followed must generally be an inquiry concerning the law as it is and the facts as they are, followed by an application of the law as determined to the facts as determined; and the end to be reached must be an act which, so long as it stands, entitles and obliges the persons between whom it intervenes, to observance of the rights and obligations that the application of law to facts has shown to exist." As I explain below, in ss 38, 39, and 79 of the Judiciary Act, the reference to jurisdiction is to its limited sense of authority to decide; it is not a reference to the powers a court may exercise. As Toohey J observed in Kable v Director of Public Prosecutions (NSW)164, quoting from Professor Lane165, the same distinction between jurisdiction and power is made in Ch III of the Constitution. For instance, s 71 of the Constitution speaks of the "judicial power of the Commonwealth" but ss 76 and 77 speak of the "jurisdiction" of the High Court and federal courts. The distinction can also be seen in a provision such as s 22 or s 23 of the Federal Court of Australia Act 1976 (Cth) which "arms the Court with power" but which "does not invest the Court with jurisdiction"166. B. The scheme of ss 38 and 39 of the Judiciary Act Although ss 38 and 39 of the Judiciary Act have been amended in some respects, the scheme introduced by those sections remains the same as it was when they were enacted. It is convenient to consider ss 38 and 39 as they were initially enacted in order to understand the operation of s 79, which was enacted at the same time. 163 R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 374 per Kitto J; [1970] HCA 8. 164 (1996) 189 CLR 51 at 95; [1996] HCA 24. 165 Lane, The Australian Federal System, 2nd ed (1979) at 446. 166 Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 at 161; [1981] HCA 48. Edelman Immediately prior to the enactment of the Judiciary Act, State Parliaments had plenary power to legislate in relation to some, but perhaps not all167, of the matters contained within ss 75 and 76 of the Constitution168. Some of these matters, including s 75(iv), which is the reason for federal jurisdiction in this case, identified "controversies well known in the anterior body of general jurisprudence in the colonies"169. Section 38 of the Judiciary Act involved an exercise of a "power to exclude"170 deriving from s 77(ii) of the Constitution. In relation to the five sub- sections of s 38, all of which fell within s 75 of the Constitution, the authority to decide these matters was made exclusive to the High Court171. Section 39(1) was also an exercise of the power to exclude deriving from s 77(ii) of the Constitution. Section 39(1) provided that the jurisdiction of the High Court in matters not mentioned in s 38 "shall be exclusive of the jurisdiction of the several Courts of the States". The exception to this exclusivity was s 39(2), which, relying upon the power in s 77(iii) of the Constitution, "invested" the courts of the States with "federal jurisdiction" in all matters in which the High Court has, or could have, original jurisdiction, other than those matters within s 38. Four matters are clear about the investing of federal jurisdiction in State courts under s 39(2) of the Judiciary Act. First, the "jurisdiction" to which s 39(2) referred was the court's authority to decide172 with the geographic, personal, and subject matter dimensions described above. It was not a vesting of power. That power already existed. The vesting of federal jurisdiction (authority to exercise the power) was expressed to be "within the limits of their several 167 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 620- 621 [27]-[30]; [2008] HCA 28, referring to Ex parte Goldring (1903) 3 SR (NSW) 260. See also Hannah v Drake (1902) 8 ALR (CN) 69; Hannah v Dalgarno (1903) 1 CLR 1 at 8; [1903] HCA 1. Cf Constitution, covering cl 5. 168 Moore, The Constitution of The Commonwealth of Australia, 2nd ed (1910) at 212; Clark, Studies in Australian Constitutional Law, (1901) at 177-178. 169 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 170 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142. 171 Later made subject to ss 39B and 44 of the Judiciary Act: see Judiciary Amendment Act (No 2) 1984 (Cth), s 5 and Jurisdiction of Courts Legislation Amendment Act 2000 (Cth), Sched 2, item 11. 172 MZXOT v Minister for Immigration and Citizenship (2008) 233 CLR 601 at 619 Edelman jurisdictions, whether such limits are as to locality, subject-matter, or otherwise". Secondly, the vesting was subject to conditions, particularly the abolition of appeals to the Queen in Council. Thirdly, despite an early wrong turning173, the "settled effect"174 of s 39(2) was that it excluded the operation of any concurrent State authority to decide. It did this by operation of s 109 of the Constitution175. As I have explained, the pre-existing State authority to decide extended to exercising the powers of State Parliament over matters within ss 75 and 76 of the Constitution. Fourthly, the federal jurisdiction vested in State courts under s 39(2) was complemented by s 17 of the Judiciary Act, which provided, and still provides, that State Supreme Courts are invested with federal jurisdiction in any matter pending in the High Court which is not a matter in which the High Court has exclusive jurisdiction. The focus in ss 38 and 39 upon jurisdiction rather than power illustrates that the concern was not to remove powers of State Parliaments, including powers conferred upon State courts by State Parliaments. Instead, it was to replace the source of authority for the exercise of the powers of State courts. To adapt the submission of Dixon KC in Booth v Shelmerdine Bros Pty Ltd176, the "whole object" of provisions such as this "in taking away jurisdiction and then giving [new jurisdiction] back was to place conditions upon its exercise". Conditions were able to be placed by the Commonwealth Parliament upon the authority to decide because the "authority to exercise judicial power with regard to those matters springs from another source"177. The important point is that by changing the source of the authority to decide matters under s 39(2) of the Judiciary Act, ss 38 and 39 were concerned only with regulating that authority to decide (ie the authority to exercise existing power). State Parliaments retained their powers to pass laws for the population including empowering State courts to make orders to give effect to those laws. The only effect of making federal jurisdiction exclusive was that, due to the 173 Lorenzo v Carey (1921) 29 CLR 243 at 251-252; [1921] HCA 58. 174 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53]; [2015] HCA 36. 175 Felton v Mulligan (1971) 124 CLR 367 at 412-413; [1971] HCA 39; Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 471, 479; [1980] HCA 32; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 571 [7]; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 21 [53]. 176 [1924] VLR 276 at 278. 177 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1143. Edelman operation of s 109 of the Constitution, the State courts had no operative State authority to exercise those existing powers in federal jurisdiction. As the authority to decide was no longer a State matter, the regulation of that authority to decide was also no longer a State matter. There is another way to illustrate the point that the effect of ss 38 and 39 was not to remove any pre-existing or prospective State power. Section 107 of the Constitution provides for the continuation of "[e]very power" of a State Parliament unless, by the Constitution, the power is "exclusively vested" in the Commonwealth Parliament or withdrawn from the Parliament of the State. Various provisions of the Constitution expressly provide for the exclusive vesting of powers in the Commonwealth Parliament. Those provisions, such as ss 52 and 90, are expressed in clear terms providing that the "power" of the Commonwealth Parliament in those areas is exclusive. Section 77 of the Constitution is not such a provision for two reasons. First, s 77 is a power conferred upon the Commonwealth Parliament to define the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to or is invested in the courts of the States. It speaks of the "jurisdiction" of the federal court, not the "power" of the federal court. Secondly, s 77 is not a provision in which anything is made exclusive "by the Constitution". In other words, with the exception of provisions such as s 52 or s 90, the Constitution did not deprive State Parliaments of their powers to make laws. The exclusive vesting of jurisdiction in any federal court did not affect State powers. Instead, it meant that the State Parliaments could not regulate that federal authority to decide, just as State Parliaments could not confer upon federal courts an effective authority to adjudicate upon those federal subject matters178. If ss 38 and 39 were to be construed as an attempt to make exclusive both jurisdiction and power, in the sense explained above, then there could be questions concerning whether those provisions were inconsistent with s 107 of the Constitution. It is one thing to make exclusive the authority to adjudicate upon the federal matters concerned to "provide for and regulate the exercise of federal jurisdiction"179. But it is quite another thing to make exclusive the federal subject matters in ss 75 and 76, and thereby deny the power of a State Parliament to make valid laws in relation to those subject matters including laws conferring powers on State courts in relation to those subject matters. In Western Australia v The Commonwealth (Native Title Act Case)180, a joint judgment of six Justices said that if s 12 of the Native Title Act 1993 (Cth) were to result in the 178 Re Wakim; Ex parte McNally (1999) 198 CLR 511; [1999] HCA 27. 179 Alqudsi v The Queen (2016) 90 ALJR 711 at 749 [171]; 332 ALR 20 at 67; [2016] HCA 24. 180 (1995) 183 CLR 373 at 487-488; [1995] HCA 47. Edelman withdrawal of legislative power from State Parliaments then it would have diminished the legislative power confirmed by s 107 of the Constitution. As the joint judgment concluded, "that it cannot do"181. In summary, ss 38 and 39 of the Judiciary Act did not convert State courts into federal courts. Nor did those sections withdraw a sphere of State legislative power. The power of State Parliaments to make laws in relation to federal subject matters in ss 75 and 76 of the Judiciary Act (including conferring powers on State courts in relation to those subject matters) was untouched. However, the effect of making the jurisdiction of the federal courts exclusive meant that the powers of State courts in relation to those matters could not be exercised without a grant to the State courts of authority to decide. As Windeyer J said in Felton v Mulligan182, the jurisdiction to which s 39(2) referred depended upon "the grant of an authority to adjudicate rather than upon the law to be applied or the subject of adjudication". His Honour continued, describing a court to which a grant of jurisdiction has been made as "a court ... duly seised for adjudication of a matter". C. The need for s 79(1) of the Judiciary Act As I have explained, s 39(2) of the Judiciary Act did not remove the corpus of law upon which State courts could adjudicate. Nor did it remove the powers of State courts in the course of that adjudication. However, by making the source of the authority to decide matters into a federal authority, there remained a gap concerning the laws which would regulate the exercise of that federal authority. When the source of the authority to decide matters within s 39(2) of the Judiciary Act became federal, there needed to be laws that would regulate that federal authority to decide. D. The text and context of s 79(1) of the Judiciary Act There are three powerful textual indications that s 79(1) is concerned only with the regulation of a court's authority to decide (the third construction). The first indication is the reference to the laws as "binding on ... Courts" rather than binding upon persons. That reference in s 79(1) is repeated in s 79(2). In a trivial sense, it could be said that all statutory laws are binding on courts. Courts must apply, and cannot ignore, statutory laws. But the history of s 79, to which I refer in the next section of these reasons, and the context of s 79, to which I refer immediately below, shows that the reference in s 79 to laws which 181 Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 182 (1971) 124 CLR 367 at 393. Edelman are "binding on ... Courts" was used in a more limited way, which contrasted with laws binding on people. In this more limited sense, laws which are binding on courts are those laws which regulate a court's authority to decide (ie authority to exercise power). The same cannot be said of laws which subject persons to duties or liabilities, or which create powers that a court can exercise against persons to give effect to those duties. These are laws binding on persons. The contrast between the reference to laws "binding on ... Courts" and the language used in covering cl 5 of the Constitution is plain. Covering cl 5, which departed from the Supremacy Clause in Art VI(2) of the United States Constitution, refers to all laws made by the Parliament of the Commonwealth under the Constitution as "binding on the courts, judges, and people of every State and of every part of the Commonwealth" (emphasis added). In its focus upon laws binding on courts rather than laws to be applied by courts, s 79(1) may also be contrasted with s 24 of the Australian Courts Act 1828 (Imp), which provided that "all Laws and Statutes in force within the Realm of England ... shall be applied". The second textual indication that s 79(1) is concerned only with laws which regulate the court's authority to decide is the specific examples in s 79(1) of laws relating to procedure, evidence, and the competency of witnesses. These examples need to be understood in context as well as in light of the history of s 79. The latter is the subject of the next section of these reasons. As to the context in which s 79 appeared in the Judiciary Act, the heading of the Part as well as the surrounding provisions all indicate a concern with subsidiary matters of regulation. Section 79 was included in Pt XI of the Judiciary Act, which was, and still is, entitled "Supplementary provisions". The first supplementary provision was, and remains, s 78, which corresponded loosely with s 35 of the United States Judiciary Act 1789. It provided, and still provides, for the manner in which parties may appear in the courts exercising federal jurisdiction. As I have explained, s 79 was another "supplementary provision", which was needed to regulate the exercise of federal authority to decide. The federal court, in 1903, was the High Court. The Judiciary Act made detailed provision for the federal jurisdiction of the High Court as well as for laws to confer powers on the High Court. Part III was entitled, and concerned with, jurisdiction and powers of the High Court generally. But there remained matters involving the regulation of the jurisdiction of the High Court, that is, matters concerning the exercise of its existing powers, to which s 79 applied. The importance of the examples of laws "relating to procedure, evidence, and the competency of witnesses" is further illuminated by the fact that seven years before the enactment of the Judiciary Act, Professor Dicey published his Edelman magisterial treatise on conflict of laws183. Dicey explained the critical difference for the purposes of choice of law which then existed between matters of procedure and matters concerning the substance of a party's rights. Within the former he included matters such as "the whole field of practice" and "the whole law of evidence"184. Dicey distinguished those "procedural" matters from matters concerned with the substance of a party's rights185: "Whilst, however, it is certain that all matters which concern procedure are in an English Court governed by the law of England, it is equally clear that everything which goes to the substance of a party's rights and does not concern procedure is governed by the law appropriate to the case." This is, emphatically, not to recognise a distinction within s 79(1) between substance and procedure. Instead, it is to recognise that in 1903 matters of procedure, evidence, and the competency of witnesses were matters widely seen as concerned with a court's authority to decide, and therefore governed by the law of the forum. That is, these three areas fell clearly within the dimensions of jurisdiction involving regulation of (i) the persons subject to the powers of the court, (ii) the subject matter over which powers are exercised, and (iii) the territory over which powers are exercised. The third textual indication is the reference in s 79(1) to "all Courts exercising federal jurisdiction" (emphasis added). The exercising of federal jurisdiction involves the exercise of powers with federal authority. As five members of this Court explained in Solomons v District Court (NSW)186, the provision "operates only where there is already a court 'exercising federal jurisdiction', 'exercising' being used in the present continuous tense". In other words, s 79(1) does not seek to apply laws concerning the subject matter upon which a court is already adjudicating, or to confer new powers upon a court already exercising powers. Rather, it seeks to regulate the dimensions within which those laws are applied and the powers exercised. 183 Dicey, A Digest of the Law of England with reference to the Conflict of Laws, 184 Dicey, A Digest of the Law of England with reference to the Conflict of Laws, 185 Dicey, A Digest of the Law of England with reference to the Conflict of Laws, 186 (2002) 211 CLR 119 at 134 [23] per Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ; [2002] HCA 47. Edelman E. The history of s 79 of the Judiciary Act When enacted, the marginal note to s 79 of the Judiciary Act made reference to its source being s 721 of the United States Revised Statutes. Section 721 provided: "The laws of the several States, except where the Constitution, treaties, or statutes of the United States otherwise require or provide, shall be regarded as rules of decision in trials at common law, in the courts of the United States, in cases where they apply." Section 721 of the United States Revised Statutes was the 1873 re-enactment of s 34 of the United States Judiciary Act 1789. Immediately after the enactment of s 34 of the Judiciary Act, Congress enacted the Process Act 1789, s 2 of which provided: "That until further provision shall be made, and except where by this act or other statutes of the United States is otherwise provided, the forms of writs and executions, except their style, and modes of process and rates of fees, except fees to judges, in the circuit and district courts, in suits at common law, shall be the same in each state respectively as are now used or allowed in the supreme courts of the same." There was a fundamental difference between the application of the Process Act and the application of s 34 of the Judiciary Act. The Process Act, and its successors until 1872, were interpreted to apply to the federal courts only statically. That is, they applied the forms of writs and executions and modes of process that existed in September 1789. On the other hand, s 34 of the Judiciary Act applied dynamically. Its reference to the laws of the States meant those laws as they existed from time to time187. There was another fundamental difference between these provisions in the Judiciary Act and in the Process Act. This difference was that although the Process Act was needed to apply State processes to federal courts, s 34 of the Judiciary Act was not a provision which was regarded as necessary. Although the scope of s 34 was sometimes disputed, including by a well-known United States Supreme Court decision relating to the expression "laws of a State" which was overruled in 1938188, at the time of Australian Federation it was established that s 34 of the Judiciary Act was a provision which was merely declaratory of 187 Wayman v Southard 23 US 1 (1825). 188 Swift v Tyson 41 US 1 at 18-19 (1842). Overruled in Erie Railroad Co v Tompkins Edelman what would in any event have governed the federal courts189. In 1945, Frankfurter J observed that this view of the declaratory nature of the section was one which had been held consistently for over 100 years190. The lack of substantive operation of s 34 is perhaps unsurprising. As Professor Fletcher (later a Justice of the Ninth Circuit Court of Appeals) observed, s 34 had been added to the Judiciary Act as an afterthought, without any of the serious debate that might be expected for a provision with substantive effect191. John Marshall had expressed the same view, independently of the provision, at the Virginia Convention to ratify the Constitution192. Until 1872, when the Process Act was reformed by the Conformity Act 1872, the difference between the static effect of the Process Act and the dynamic effect of the United States Judiciary Act meant that it was important to determine whether a law fell within the terms of the Process Act or within the terms of s 34 of the Judiciary Act. In 1872, by s 5 of the Conformity Act, Congress provided for the federal courts to follow the procedures of the States in relation to the "practice, pleadings, and forms and modes of proceeding" from time to time other than in equity and admiralty and subject to the rules of evidence under the laws of the United States. Section 5 of the Conformity Act was the progenitor of s 914 of the United States Revised Statutes. After 1872, it was no longer as important to determine whether a law was one which fell within the "rules of decision" or the "practice, pleadings, and forms and modes of proceeding". In the United States, the courts began to treat the two provisions together, considering the latter as having "enlarged" the former. For instance, in 1885, the United States Supreme Court in Ex parte Fisk193 considered a case where a petitioner had refused to be examined in the federal court to which his case had been removed. A question before the Supreme Court was whether the New York laws concerning the examination of 189 Ex parte Biddle 3 F Cas 336 at 337 (1822); Bank of Hamilton v Dudley 27 US 492 at 525 (1829); Hawkins v Barney's Lessee 30 US 457 at 464 (1831), quoted in Erie Railroad Co v Tompkins 304 US 64 at 72 (1938); Mason v United States 260 US 545 at 559 (1923). See also Du Ponceau, A Dissertation on the Nature and Extent of the Jurisdiction of the Courts of the United States, (1824) at 37. 190 Guaranty Trust Co v York 326 US 99 at 103-104 (1945). 191 Fletcher, "The General Common Law and Section 34 of the Judiciary Act of 1789: The Example of Marine Insurance", (1984) 97 Harvard Law Review 1513 at 1527. 192 Guaranty Trust Co v York 326 US 99 at 104 fn 2 (1945), citing 3 Elliot's Debates Edelman the petitioner applied in the federal court. The Supreme Court held that they did. The Supreme Court relied upon s 914 of the United States Revised Statutes (deriving from the Process Act and the Conformity Act) rather than s 721 (deriving from the Judiciary Act). Delivering the opinion of the Supreme Court, Miller J conflated the two provisions, saying that s 721 of the United States Revised Statutes had been "enlarged in 1872 by the provision found in § 914 of the Revision"194. Ultimately, however, the State statute in that case did not apply because it was in conflict with a federal law. The development of s 721 of the United States Revised Statutes, which took place before Australian Federation, culminated in the decision of the Supreme Court of the United States in Camden and Suburban Railway Co v Stetson ("Camden")195. That decision was cited by Dixon J in Huddart Parker Ltd v The Ship Mill Hill196 as evidence of the "long and controversial history" of s 721. The decision in Camden was effectively the culmination of the process by which the merely declaratory s 34 (later s 721 of the United States Revised Statutes) had been effectively expanded to include the "practice, pleadings, and forms and modes of proceeding", an expression which included the laws of evidence. The decision in Camden concerned whether a federal court could exercise a power conferred by State legislation to order a surgical examination of a plaintiff in a personal injury action. The decision of the majority was delivered by Peckham J. His Honour relied upon the decision in Ex parte Fisk in support of the application of State laws of evidence in the federal court. He applied s 721 of the United States Revised Statutes in the sense in which that section had been "enlarged" in Ex parte Fisk. His Honour held that the statute in question fell "within the principle of the decisions of this court holding a law of the State of such a nature binding upon Federal courts sitting within the State"197. The use of the expression "binding upon Federal courts" was important. The "nature" of the statute in question which was binding on federal courts was that it was one which "was intended to confer upon the courts of the United States the jurisdiction necessary to enable them to administer the laws of the States"198. 194 Ex parte Fisk 113 US 713 at 719 (1885). 196 (1950) 81 CLR 502 at 507; [1950] HCA 43. 197 Camden 177 US 172 at 174-175 (1900). 198 Camden 177 US 172 at 175 (1900). See also United States v Reid 53 US 361 at Edelman By 1900, therefore, the merely declaratory function of s 721 of the United States Revised Statutes, indicating that which would have been the law in any event, had been treated by combination with s 914 to give s 721 an expanded operation extending to the manner, or administration, of a court's authority to decide cases. In that sense, s 721 had progressed from being a merely declaratory provision, which referred to all State laws that were binding on the people, to a provision which applied to laws concerned with the authority to decide cases that were "binding on courts". The decision in Camden was given shortly before the Bill containing what became s 79 the Judiciary Act was first drafted199. When s 79 was enacted its focus was upon the "expanded" sense of s 721 of the United States Revised Statutes, including the operation of s 914. It was not focussed upon those matters included in the merely declaratory s 721. As Dixon J observed in Huddart Parker Ltd v The Ship Mill Hill200, s 79 was more widely expressed than the United States provision. Section 79 did not use the language of "rules of decision in trials", preferring instead to refer to laws which, in the language of the Supreme Court in Camden, were "binding on all Courts exercising federal jurisdiction" in cases where they apply. As I have explained, specific reference was made in s 79 to the laws relating to procedure, evidence, and the competency of witnesses. As the United States jurisprudence had shown, the three examples given in s 79 are classic examples of laws which were concerned with the regulation of the exercise of a court's existing powers. They are laws concerned with the authority to decide. They are not concerned with, for instance, creating rights or duties, nor with creating the court's powers to give effect to those rights or duties. F. Authorities supporting the first construction A strong focus of the submissions in this appeal concerned five decisions of this Court which the appellant said were authorities that supported what I have defined as the first construction of s 79(1). The appellant said that these authorities applied s 79(1) to laws which "created norms or imposed liabilities". In chronological order, each of those authorities is considered below. The first case upon which the appellant relied was R v Oregan; Ex parte Oregan201, a decision of Webb J exercising the original jurisdiction of the High Court, sitting in Victoria. The claim was brought by a wife, who was resident in 199 Judiciary Bill 1901 (Cth), cl 72. 200 (1950) 81 CLR 502 at 507. 201 (1957) 97 CLR 323; [1957] HCA 18. Edelman Victoria, for custody of her child, who was living with her estranged husband in Tasmania. The matter was in federal jurisdiction under s 75(iv) of the Constitution. The relevant law of Victoria was different from the law of Tasmania202. After setting out the facts of the case and the approach that he would take if the Victorian legislation would apply, his Honour turned to whether the applicable law was (i) the Victorian statute law, (ii) the Tasmanian statute law, or (iii) the common law. The two relevant Victorian provisions were ss 136 and 145 of the Marriage Act 1928 (Vic)203. Section 136 was a norm creating provision. It was as follows: "Where in any proceeding before any Court (whether or not a Court within the meaning of this Part) the custody or upbringing of an infant, or the administration of any property belonging to or held on trust for an infant, or the application of the income thereof is in question, the Court in deciding that question shall regard the welfare of the infant as the first and paramount consideration, and shall not take into consideration whether from any other point of view the claim of the father or any right at common law possessed by the father in respect of such custody upbringing administration or application is superior to that of the mother, or the claim of the mother is superior to that of the father." The second provision, s 145 of the Marriage Act, was different from the norm creating nature of s 136. Section 145 was concerned with orders that the Court might make. Unlike s 136, s 145 was replicated in the equivalent Tasmanian legislation (s 10 of the Guardianship and Custody of Infants Act 1934 (Tas)). In oral argument before Webb J204, senior counsel for the wife submitted that s 145 was relevantly identical to the Tasmanian provision. This was not disputed by senior counsel for the husband, and Webb J described the provisions as corresponding205. The real argument concerned whether the norm creating Victorian provision, s 136, applied. The ultimate result of the case was that the Victorian provisions, including s 136, were applicable due to the operation of s 80 of the Judiciary Act. However, the only reason why Webb J did not apply these provisions by relying upon s 79 of the Judiciary Act was that his Honour considered that the terms of 202 R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 325. 203 Repealed by the Marriage Act 1958 (Vic). 204 High Court of Australia, Transcript, Melbourne (4 March 1957) at 3. 205 R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 328. Edelman the provisions did not extend to a person domiciled and residing in Tasmania who had the legal custody of the child in Tasmania206. The application of s 79 to the norm creating provision in s 136 of the Victorian legislation supports the first construction of s 79. However, the reasoning of Webb J concerning why s 79 would apply was sparse. The point does not appear to have been a matter of substantial argument. His Honour simply said that "[t]he laws referred to in s 79 include, I think, substantive laws, embracing those dealing with the custody of infants"207. The second authority upon which the appellant relied was Parker v The Commonwealth208. That case involved a claim against the Commonwealth of Australia by Mrs Parker, the wife of a seaman who died as a result of the collision on the high seas of HMAS Melbourne and HMAS Voyager. The action was heard by Windeyer J in the original jurisdiction of the High Court, sitting in Victoria. The difficulty for the claim by Mrs Parker was that the common law gave her no cause of action for losses suffered as a result of the death of her husband. That omission of the common law had been filled in England by the Fatal Accidents Act 1846 ("Lord Campbell's Act"), legislation which had been replicated in the States and Territories in Australia. Justice Windeyer recognised that the matter was in federal jurisdiction and that the "solution" must be sought by asking whether federal law "attracts and adopts State law, making it for purposes of an action in this Court the lex fori"209. His Honour held that the combination of ss 79 and 80 of the Judiciary Act applied the law of Victoria. This meant that the law to be applied was the Victorian equivalent of Lord Campbell's Act, the Wrongs Act 1958 (Vic). It must immediately be acknowledged that the Victorian legislation applied in Parker v The Commonwealth went beyond the laws contemplated by the second or third constructions of s 79 of the Judiciary Act. The Wrongs Act did not merely confer powers on the Court or govern the Court's powers. It created an entirely new cause of action which did not exist under the common law. As Windeyer J explained210, quoting from Commissioner of Stamp Duties 206 R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 330. 207 R v Oregan; Ex parte Oregan (1957) 97 CLR 323 at 330. 208 (1965) 112 CLR 295; [1965] HCA 12. 209 Parker v The Commonwealth (1965) 112 CLR 295 at 306. 210 Parker v The Commonwealth (1965) 112 CLR 295 at 307. Edelman (NSW) v Owens [No 2]211, it concerned the law by which the "rights of the parties to the lis are to be ascertained". Three points should be made about the conclusion of Windeyer J. These three points show that the case is weak authority for the first construction of s 79. First, there was no dispute in that case that the law of Victoria was the applicable law212. Secondly, the application of ss 79 and 80 to reach the conclusion that the law of Victoria applied was only an alternative approach suggested by Windeyer J. The first route that his Honour suggested was simply that common law choice of law rules would apply Victorian statute law to determine the rights arising from the high seas collision. Thirdly, the alternative approach was based on a combination of ss 79 and 80 of the Judiciary Act. Section 80, at that time, provided for the application of the common law of England, as modified by the Constitution and the statute law in force in Victoria (the State in which the Court was sitting). His Honour recognised that "constituting an entirely new right of action is not well described as a modification of the common law" but said that this would be "too narrow a view"213. The third authority upon which the appellant relied was Australian Securities and Investments Commission v Edensor Nominees Pty Ltd ("Edensor")214. In that case, the Australian Securities and Investments Commission ("ASIC") alleged that various companies had contravened s 615 of the Corporations Law (Vic) by entering into a shareholders agreement. The primary judge made orders under ss 737 and 739 of the Corporations Law (Vic), including declarations of contravention. The Full Court of the Federal Court held that the primary judge lacked jurisdiction to make those orders. A majority of the High Court held that the primary judge did have jurisdiction. The High Court held that the matter was within federal jurisdiction, and within the authority of the Federal Court, because ASIC, which was the applicant for relief, fell within the scope of "the Commonwealth" in s 75(iii) of the Constitution and s 39B(1A)(a) of the Judiciary Act215. A joint judgment was given by Gleeson CJ, Gaudron and Gummow JJ, with whom Hayne and Callinan JJ generally agreed. The joint judgment of Gleeson CJ, Gaudron and Gummow JJ distinguished between three different types of laws: (i) those that 211 (1953) 88 CLR 168 at 170; [1953] HCA 62. 212 Parker v The Commonwealth (1965) 112 CLR 295 at 306. 213 Parker v The Commonwealth (1965) 112 CLR 295 at 307. 214 (2001) 204 CLR 559. 215 Edensor (2001) 204 CLR 559 at 580-581 [39]-[40]. Edelman create a norm of legal liability, (ii) those that confer a remedy, and (iii) those that provide a curial forum to administer the remedy216. In relation to this taxonomy of laws, s 615 of the Corporations Law (Vic) created a norm of legal liability. However, the focus of the decision was not upon s 615, because the submissions had been directed to the question of whether the orders made by the primary judge, under ss 737 and 739, were valid. Nevertheless, their Honours contemplated, without deciding, that if the action had been commenced in a different State where s 615 did not apply then s 79 of the Judiciary Act might have denied the applicability of s 615217. Their assumption in posing this hypothetical scenario was that s 79 of the Judiciary Act was needed to apply s 615 of the Victorian law. In a separate judgment, McHugh J was explicit. His Honour held that s 615 was applied as a Commonwealth law by s 79218. All members of the Court, apart from Kirby J, held that ss 737 and 739 were applied as Commonwealth laws by s 79 of the Judiciary Act219. Two points should be made about the decision in Edensor. First, although the Court's reasoning was consistent with the first construction of s 79, as submitted by the appellant, it was not argued in that case that any of ss 615, 737, or 739 applied of its own force. Secondly, unlike the appeal in this case, Edensor was heard in the Federal Court. Different issues arise when the question, such as that in Edensor, concerns the powers of federal courts in the application of State laws. Although the present appeal does not concern the question of State laws operating in a federal court, I agree with the conclusion of the other members of this Court in this appeal that s 615 of the Corporations Law (Vic) applied of its own force in the Federal Court in a case in which the Federal Court had authority to decide. Section 615 provided the "case for relief"220. As for the relief under ss 737 and 739, those sections could be given effect by s 23 of the Federal Court of Australia Act, which provides that "[t]he Court has power, in relation to 216 Edensor (2001) 204 CLR 559 at 590 [66]. 217 Edensor (2001) 204 CLR 559 at 587-588 [58]. 218 Edensor (2001) 204 CLR 559 at 609 [130]. 219 Edensor (2001) 204 CLR 559 at 587 [58] per Gleeson CJ, Gaudron and Gummow JJ, 600 [102], 609 [130], 614-615 [146]-[147] per McHugh J, 639 [219] per Hayne and Callinan JJ. 220 Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 at 161. Edelman matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate". This is a "broad power"221. Sections 737 and 739 of the Corporations Law (Vic) could apply not as State laws which conferred new powers on the Federal Court but as circumstances where the Federal Court thinks it "appropriate" to make orders that would otherwise be made if the matter were in State jurisdiction. In other words, unlike State laws which can confer new powers on State courts, or Commonwealth laws which can confer new powers on federal courts, the State laws in ss 737 and 739 could only regulate the existing powers of the Federal Court, by drawing new "boundaries"222 around federal powers. That regulation of power by ss 737 and 739 would require those laws to be applied, as Commonwealth laws, by s 79 of the Judiciary Act. Only to that extent would s 79 be required. As Dixon J said in Musgrave v The Commonwealth223, s 79 applies "only where otherwise Federal law itself is insufficient". The fourth authority upon which the appellant relied was Austral Pacific Group Ltd (In liq) v Airservices Australia224. In that case, Austral Pacific was sued by Mr Crockford in the District Court of Queensland. It was assumed that the matter arose in federal jurisdiction either because the claim arose under a law made by the Commonwealth Parliament or because Airservices was the Commonwealth. Austral Pacific claimed contribution from Airservices. The issue was whether s 79 of the Judiciary Act applied to the contribution legislation in Queensland. That contribution legislation gave Austral Pacific a right to proceed against Airservices225 as well as providing for the manner in which contribution would be calculated226. It was assumed by the parties that absent s 79, Austral Pacific had no right to contribution from Airservices. The High Court assumed that s 79 applied to both the law concerning the right to proceed and the law concerning the manner in which contribution would be calculated. Again, although this assumption affirmed the first construction, the matter was not the subject of any argument, nor were competing constructions considered. The third construction would have recognised, by application of their own force, 221 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 622. 222 Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 at 161. 223 (1937) 57 CLR 514 at 547; [1937] HCA 87. 224 (2000) 203 CLR 136. 225 Law Reform Act 1995 (Q), s 6. 226 Law Reform Act 1995 (Q), s 7. Edelman the law giving a right to proceed and the law providing for the manner in which contribution would be calculated. The fifth authority upon which the appellant relied was Macleod v Australian Securities and Investments Commission ("Macleod")227. Mr Macleod was charged with offences under the Corporations Law (WA). The proceedings were instituted by ASIC (as it was later entitled). As ASIC was, relevantly, the Commonwealth, the proceedings were in federal jurisdiction. Mr Macleod was convicted of one count in the Court of Petty Sessions. His appeal to the Supreme Court of Western Australia was heard by a Commissioner. The appeal was allowed and his conviction was quashed. ASIC brought a further appeal to the Full Court of the Supreme Court of Western Australia, where the conviction was reinstated. The question before the High Court was whether ASIC had the power to bring that appeal. One alleged source of power was s 206A(2) of the Justices Act 1902 (WA), which permitted a party to an appeal to bring an application for leave to appeal to the Full Court of the Supreme Court. The High Court held that s 206A(2) did not fall within the ambit of s 79 of the Judiciary Act because the Australian Securities Commission Act 1989 (Cth) "otherwise provided". Therefore, ASIC had no power to appeal under that provision. On this appeal, the focus of the appellant's submissions regarding Macleod concerned an apparently unqualified reference in the joint judgment of Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ to s 79 operating to "pick up" all State laws. The opening paragraph of the joint judgment commenced by describing the offences charged as being "offences against the law of Western Australia"228. Since the laws were made by the Parliament of Western Australia, not the Parliament of the Commonwealth of Australia, they were not laws to which s 68(2) of the Judiciary Act applied229. However, soon after explaining this point, their Honours said, without qualification, that s 79 of the Judiciary Act operated to "pick up" the State law of Western Australia230. This is yet another indication of support for the first construction of s 79. Again, however, the other constructions were not the subject of argument. 227 (2002) 211 CLR 287; [2002] HCA 37. 228 Macleod (2002) 211 CLR 287 at 291 [1]. 229 Macleod (2002) 211 CLR 287 at 292 [8]. 230 Macleod (2002) 211 CLR 287 at 293 [10]. Edelman G. Reasons to prefer the third construction The above discussion demonstrates that there is a dominant strand of authority in this Court which supports the appellant's construction (the first construction). In Commissioner of Stamp Duties (NSW) v Owens [No 2]231, a joint judgment of this Court said that the purpose of s 79 was, subject to the Constitution or federal law, to adopt the law of the State by which "the rights of the parties to the lis are to be ascertained and matters of procedure are to be regulated". In Pedersen v Young232, Windeyer J said of s 79 that the law "binding upon courts" has been held to be "the whole body of the law of the State including the rules of private international law". In combination, the five authorities upon which the appellant relied support the conclusion that the dominant approach of this Court for decades has been to apply the first, and broadest, construction of s 79(1). The step that this Court takes today departs from those authorities. However, the second and third constructions are not wholly new conceptions. Statements in some decisions of this Court can be marshalled in support of either or both of those constructions233. More fundamentally, I am not aware of, and no counsel cited, any case where argument was directed to the distinction between the competing constructions of s 79(1) which are relevant in this appeal. As I have explained above, the result of each of the five cases relied upon by the appellant would be no different if the second or third construction were adopted. Apart from Edensor, in each case the laws which were applied as Commonwealth laws by s 79 would still have applied in federal jurisdiction, on the third construction, of their own force. In Edensor, the operation of ss 737 and 739 of the Corporations Law (Vic) would be given effect by s 23 of the Federal Court of Australia Act. The text, context, and purpose of s 79(1) support the third construction The considerations of the text, context, and purpose of s 79(1) have been discussed above. Those matters all point against the first construction of s 79(1), by which s 79(1) applies to all State laws, irrespective of content. In my view, those considerations also favour the third, more narrow, construction over the second. 231 (1953) 88 CLR 168 at 170. 232 (1964) 110 CLR 162 at 169-170. 233 Musgrave v The Commonwealth (1937) 57 CLR 514 at 551; Anderson v Eric Anderson Radio & TV Pty Ltd (1965) 114 CLR 20; [1965] HCA 61; Felton v Mulligan (1971) 124 CLR 367 at 393; Momcilovic v The Queen (2011) 245 CLR 1 Edelman First, ss 38 and 39 of the Judiciary Act did not remove the powers of State Parliaments to pass laws for the population, including the power that they had conferred, and could confer, upon courts to make orders to create new rights or duties or to give effect to pre-existing rights or duties. Those powers of State Parliaments remained unaltered although the source of authority to adjudicate became federal. The need for s 79 was confined to laws which regulated the authority to decide. Secondly, the first and second constructions assume an operation of s 79(1) which goes beyond those laws which are binding on courts such as laws concerning procedure, evidence, and the competency of witnesses. The first and second constructions include laws which confer, or had conferred, any powers on courts to make orders, in the broad sense which includes decrees and pronouncements. These were matters which fell within the merely declaratory aspect of s 721 of the United States Revised Statutes. Thirdly, the second construction assumes that laws can be neatly divided into (i) those which are the norm or source of liability, and (ii) those which permit a sanction to be imposed or orders made as a consequence of that liability. There is little support textually for this division. Moreover, as Austral Pacific Group Ltd (In liq) v Airservices Australia illustrates, those two components are not easily separated. The nature, and coherence, of such a division was controversial in 1903. But, as Dixon J observed in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett234, a common, but controversial, 19th century drafting technique was for a person's rights or duties to be expressed "to hinge upon the act of a court or other authority". The close association between the court order and the substantive liability reflected a dominant view, albeit powerfully criticised by Bentham235, that in many cases, orders that the court makes merely replicate the source of rights or liability. This is what Blackstone meant by his description of a common order which depends "not therefore on the arbitrary caprice of the judge, but on the settled and invariable principles of justice"236. In the language of Dr Zakrzewski, the rights which flow from court orders often "replicate substantive rights"237. Fourthly, the second construction awkwardly requires laws which empower orders that a court might make against a person to be construed as laws 234 (1945) 70 CLR 141 at 166; [1945] HCA 50. 235 Bentham, A Comment on the Commentaries: A Criticism of William Blackstone's Commentaries on the Laws of England, (1828) at 87. 236 Blackstone, Commentaries on the Laws of England, (1768), bk 3, ch 24 at 396. 237 Zakrzewski, Remedies Reclassified, (2005) at 78. Edelman "binding on all Courts" rather than laws binding upon persons. An example is the law considered in Momcilovic v The Queen238. That law was s 71AC of the Drugs, Poisons and Controlled Substances Act 1981 (Vic), which provided that: "A person who, without being authorized by or licensed under this Act or the regulations to do so, trafficks or attempts to traffick in a drug of dependence is guilty of an indictable offence and liable to level 4 imprisonment (15 years maximum)." Even assuming that the liability for imprisonment should be divorced from the offence upon which it was based although it is formally within the same law as the offence creating provision (s 71AC), the liability to a maximum of 15 years' imprisonment is a law which is better seen as binding upon a person by creating a liability to which that person is subject, rather than being a law which is binding on a court, within the dichotomy assumed in s 79(1). Constitutional restrictions on power favour the third construction Another reason why the third construction of s 79(1) is preferable to the first is that, as the respondent submitted, the first construction of s 79(1) would take it beyond the legislative power of the Commonwealth Parliament. It is not necessary to consider whether the second construction is within power. This was not the subject of submissions on this appeal. It suffices to say that I do not consider that the first construction would be within the power of the Commonwealth Parliament. The first construction would permit the Commonwealth Parliament to legislate, without limit, to create any laws in relation to the subject matters in s 75 or s 76 of the Constitution. In Edensor239, McHugh J expressed the view that, at least where the Commonwealth or a State was a party to the proceedings, "there would seem to be no limit to the State laws that the Parliament can make applicable in those proceedings". But neither s 75 nor s 76 of the Constitution is a conferral of general power on the Commonwealth Parliament to legislate with respect to the subject matters in those sections. The strongest submission in support of the validity of s 79(1) on the first construction is that s 79(1) does not purport to rely upon a general power to legislate with respect to any subject matter in federal jurisdiction because it only operates to "pick up" the text of a State statute, and is designed only to ensure consistency between cases where courts exercise authority with a federal source and cases where courts exercise authority from other sources. However, 238 (2011) 245 CLR 1. 239 (2001) 204 CLR 559 at 610 [130]. Edelman underlying this submission is the misleading metaphor of s 79(1) only "picking up" a State law. The assumption of the first construction, and the need for s 79(1) on that construction, is that the State law is otherwise inoperative. The State statute merely supplies the (inoperative) text which becomes the Commonwealth law. The appellant submitted that the source of power for the Commonwealth Parliament to apply, as Commonwealth law, inoperative State laws on almost unlimited subjects is the provisions of Ch III of the Constitution generally, combined with the power in s 51(xxxix) concerning matters incidental to the execution of powers of the Federal Judicature. It can be accepted that this is the source of power for s 79(1)240. But there is no express conferral of power in Ch III of the breadth required for the first construction of s 79(1) of the Judiciary Act. As for the incidental power, the constitutional question is whether this power is "necessary or proper" to render effective the exercise of federal authority241. Section 51(xxxix) gives the Commonwealth Parliament power to make laws incidental to the execution of any power vested by the Constitution in the Federal Judicature. Writing in 1901, Quick and Garran observed that under the incidental power "the Parliament can legislate with respect to the practice and procedure of the Courts, the conduct of appeals, the admission and status of legal practitioners in the courts of federal jurisdiction, and so forth"242. These are obvious examples of incidental power. Other instances concerning the regulation of authority to decide would be included. But s 51(xxxix) does not confer an almost unlimited legislative power including the power to legislate upon many matters beyond the existing subject matter of Commonwealth legislative power. Applicable law principles favour the third construction It is clear from the wording of s 79(1) that the laws which the provision applies as Commonwealth law are the laws "binding on all Courts exercising federal jurisdiction in that State or Territory" (emphasis added) in which the court is sitting243. One immediate difficulty with the first construction of s 79(1) is that, when read with s 80, it would create an applicable law rule which had the effect that, whenever a State or federal court adjudicated upon a matter within federal jurisdiction, the applicable statute law would be the statute law of the 240 Burton v Honan (1952) 86 CLR 169 at 177-178; [1952] HCA 30. 241 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 579 [118]. 242 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 243 See, eg, Pedersen v Young (1964) 110 CLR 162 at 165. Edelman State in which the matter was heard244. In the United States, even after Erie Railroad Co v Tompkins245, it was very quickly noticed that there were areas where the application of State law was "singularly inappropriate" and would "lead to great diversity in results by making identical transactions subject to the vagaries of the laws of the several states"246. In the Australian context, the first construction of s 79(1) could mean that the High Court could hear appeals involving identical facts which occurred in the identical place, but reach different conclusions if the trials had been heard in different States. The second and third constructions are not generally subject to these vagaries. There are, however, difficulties in the second construction of s 79(1). On the assumption underlying the second construction, that laws conferring powers on State courts are not operative in federal jurisdiction, the rule of conduct provided by an applicable inter-State statute could be operative but no orders could be made. In other words, if the applicable State law is not the law of the State where the matter is heard then the only powers that the court could exercise would be created by the potentially different statute law of the State where the matter is heard. This surprising conclusion also sits uncomfortably with the reference in s 80 of the Judiciary Act to the "statute law in force" in a State, which would need to be construed as excluding any powers to make orders under inter-State statutes even if the obligations under those statutes could be in force. An example can be given which illustrates this difficulty with the second construction. Suppose a matter concerning a tort claim in federal jurisdiction were heard in a court in New South Wales based upon a tort committed in Western Australia. The terms of the Civil Liability Acts, including provisions concerning the court's power to award damages, differ between those States247. Assuming that the applicable law is the statute law of Western Australia then, on the assumption underlying the second construction of s 79(1), three possibilities arise. One unlikely possibility is that s 79(1) would apply the damages provisions from the New South Wales Act as the remedy for breach of the 244 The potential conflict of statutes was not considered in John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503; [2000] HCA 36. See at 515 [3]. But the joint judgment in that case appeared to assume the application of the first construction of s 79(1) if the matter had been in federal jurisdiction: see at 532 [58]. 246 Clearfield Trust Co v United States 318 US 363 at 367 (1943) limiting the reach of Erie Railroad Co v Tompkins 304 US 64 (1938). 247 Compare Civil Liability Act 2002 (NSW), Pt 2 with Civil Liability Act 2002 (WA), Edelman different provisions of the Western Australian Act. It is difficult to see how the New South Wales Act provisions concerning damages could be "applicable" within s 79(1). A second possibility is that the Western Australian law would apply but that the court could not make any orders under that legislation, because (i) the court is sitting in New South Wales so s 79(1) could not apply the laws of Western Australia, and (ii) on the second construction, the Western Australian laws conferring powers on courts could not apply in federal jurisdiction. A third possibility is that some rule, external to s 79(1), would operate to allow the court to apply the damages provisions in the Western Australian legislation. One such rule might be said to arise from s 118 of the Constitution, which requires that full faith and credit be given in New South Wales to the Western Australian law. But that conclusion would substantially undermine the assumption of the second construction that those State laws do not apply in federal jurisdiction. This difficulty is further exacerbated by the possibility that a State court might move from exercising State jurisdiction to exercising federal jurisdiction during the course of adjudicating upon a matter248. This might occur, for example, if a constitutional issue were raised during the hearing of the matter. If the applicable law were the law of a different State from the State in which the matter is being heard then the second construction might have the effect that a change of authority from State to federal would mean that the State court could no longer make any orders under the applicable statute. The third construction provides a simple answer to these scenarios and an explanation for why a remittal from the High Court would not always have to be to the State whose law applied249. In the example above, the statute law of Western Australia would apply, including the orders that the court can make. In Anderson v Eric Anderson Radio & TV Pty Ltd250, an action for damages arising from negligence which occurred in the Australian Capital Territory was brought in the District Court of New South Wales. The scenario did not involve different statutes in the Territory and State, and a majority of the High Court held that the matter was not in federal jurisdiction. However, the case illustrates the context in which these questions might arise. In the course of discussing a submission that the source of the jurisdiction being federal could affect the applicable law, Kitto J 248 Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 262 [29]; [2005] HCA 38. 249 Johnstone v The Commonwealth (1979) 143 CLR 398; [1979] HCA 13. See especially Pozniak v Smith (1982) 151 CLR 38 at 54; [1982] HCA 39. 250 (1965) 114 CLR 20. 251 Anderson v Eric Anderson Radio & TV Pty Ltd (1965) 114 CLR 20 at 30. Edelman "[A]ll that is meant by saying that a court has federal jurisdiction in a particular matter is that the court's authority to adjudicate upon the matter is a part of the judicial power of the federation. To confer federal jurisdiction in a class of matters upon a State court is therefore not, if no more be added, to change the law which the court is to enforce in adjudicating upon such matters; it is merely to provide a different basis of authority to enforce the same law." The same approach was taken by Evatt and McTiernan JJ in Musgrave v The Commonwealth252, where a libel action was heard in the original jurisdiction of the High Court, sitting in New South Wales. The defendant relied upon a defence of privilege in s 377 of the Criminal Code (Q). The primary judge, Latham CJ, held that s 79 of the Judiciary Act required the law of New South Wales to be applied. On appeal, Rich and Dixon JJ did not need to decide whether s 79 required the application of the law of New South Wales253. However, Evatt and McTiernan JJ held that s 79 did not require the application of the laws of New South Wales. It did not "introduce, for the purpose of determining the lawfulness of the publication complained of, the general body of New South Wales law, merely because the action, being instituted in the High Court, happens to have been heard at Sydney"254. Conclusion Although it is not necessary to express a final opinion, my view is that the third construction of s 79(1) of the Judiciary Act should be adopted. I do not express a final opinion because no party, and no intervener, drew a clear distinction between the second and third constructions. It suffices to say that of the two better constructions (the second and third constructions) there are reasons of history, text, context, and purpose to prefer the third construction. The third construction also aligns with the fundamental distinction between jurisdiction and power. The third construction is that the laws to which s 79(1) refers are only those laws which, in the language used by the Attorney-General of the State of Queensland intervening, "are directed to the regulation of jurisdiction [in the sense of the authority to decide]". Section 79(1) is only needed, and only applies, for laws which regulate the exercise of the court's existing powers, including the manner and conditions upon which those powers can be exercised. 252 (1937) 57 CLR 514 at 551. 253 Musgrave v The Commonwealth (1937) 57 CLR 514 at 543, 547-548. 254 Musgrave v The Commonwealth (1937) 57 CLR 514 at 551. Edelman The submissions on this appeal did not need to, and did not, address a number of difficult issues which still remain in relation to the operation of s 79(1). One issue is the extent to which s 79(1) can apply the text of a State statute with a changed meaning. Another issue is the boundaries of laws which regulate an authority to decide. It will not always be a simple exercise to determine whether a State law is one which is binding on a court, involving the regulation of the court's authority to decide (ie regulation of the court's exercise of existing powers), or whether the law is one which is binding on a person or persons. However, at the core, some simple examples can be given. Laws concerning procedure, evidence, and the competency of witnesses all regulate the general manner of the court's authority to decide over its subject matter. In relation to State courts, they are laws which explain how State courts' powers should be exercised. They are not concerned with the rights or duties of persons. Section 114(2) of the Criminal Procedure Act 2004 (WA), which permitted the jury in the appellant's trial to return a verdict upon which 10 or more jurors were agreed, is one such law. Without s 79(1) of the Judiciary Act, the State court exercising federal jurisdiction would not be regulated by this law. Another example of a law which regulates the subject matter of a court's authority to decide is a law which limits the time within which an action can be brought. These laws were described in 1893 by the United States Supreme Court255 as the laws which had been the most "steadfastly" and often recognised as falling within s 721 of the United States Revised Statutes. These laws are expressly recognised in s 79(3)(a) of the Judiciary Act. And the High Court of Australia has given regular recognition of laws which limit the time in which an action can be brought as laws which can fall within s 79(1) of the Judiciary Laws which limit the time in which an action can be brought are an example of laws which concern when a court can adjudicate upon rights falling within a particular subject matter. The limitation laws do not "bar" a person's rights. Instead, they provide a defence which precludes an effective adjudication upon those rights. Although this is no longer the case257, at the time of the enactment of the Judiciary Act, it was "not to be questioned that laws limiting the 255 Bauserman v Blunt 147 US 647 at 652 (1893). 256 Federated Sawmill, Timberyard and General Woodworkers' Employes' Association (Adelaide Branch) v Alexander (1912) 15 CLR 308 at 321; [1912] HCA 42; Cohen v Cohen (1929) 42 CLR 91 at 99; [1929] HCA 15; John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 80-81, 83, 88; [1973] HCA 257 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503. Edelman time of bringing suit constitute a part of the lex fori of every country"258. The reason why such limitation provisions were considered to be part of the lex fori was that they regulated the subject matter upon which the court would adjudicate. In the language of the United States Supreme Court in the decade before the enactment of the Judiciary Act in 1903, limitation laws concern the "means which the law provides for prosecuting [a] claim"259. They were described in 1878 as "laws for administering justice; one of the most sacred and important of sovereign rights"260. This was then seen as a matter for the law of the forum. Apart from laws which regulate the subject matter dimension of the court's authority to decide, s 79(1) will also apply to laws which regulate the personal dimension of the authority to decide such as laws which determine the persons who can appear before the court. So, in Macleod for instance, s 79 was needed to the Justices Act 1902 (WA). engage Section 206A(2) was a law concerned with the persons who could bring an appeal. Similarly, laws giving a court the power to stay proceedings are laws which regulate the authority to decide over the persons before the court261. the operation of s 206A(2) of On the other hand, laws which regulate a court's authority to decide will not usually include the general corpus of law which establishes the rights, privileges, powers, immunities, duties, disabilities, and liabilities of persons. This includes orders of a court, which usually give effect to these rights and duties. Section 6(1)(a) of the Misuse of Drugs Act 1981 (WA), upon which the appellant was convicted, is a law which created the duty to which he was subject. The provision in s 6(1)(a) that a person commits a crime if the person "with intent to sell or supply it to another, has in his [or her] possession ... a prohibited drug" is not concerned with the regulation of a court's authority to decide. It is a law binding on persons, not a law binding on courts. The same is true of s 34(1) of the Misuse of Drugs Act, which provides for the penalty for contravention of s 6(1)(a) of a fine not exceeding $100,000 or a term of imprisonment not exceeding 25 years or both. Since s 79(1) did not apply to these provisions, the appellant's trial was not for offences against a law of the Commonwealth. 258 Bauserman v Blunt 147 US 647 at 654 (1893), quoting Amy v Dubuque 98 US 470 259 Bauserman v Blunt 147 US 647 at 659 (1893), quoting Amy v Watertown (No 2) 130 US 320 at 325 (1889). 260 Amy v Dubuque 98 US 470 at 470-471 (1878), quoting Hawkins v Barney's Lessee 30 US 457 at 466 (1831). 261 Huddart Parker Ltd v The Ship Mill Hill (1950) 81 CLR 502 at 507-508; John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 88. Edelman Section 80 of the Constitution was not engaged and conviction by a unanimous jury was not required. The appeal must be dismissed.
HIGH COURT OF AUSTRALIA WHISPRUN PTY LIMITED (Formerly Northwest Exports Pty Limited) APPELLANT AND RESPONDENT Whisprun Pty Ltd v Dixon [2003] HCA 48 3 September 2003 ORDER 1. Appeal allowed with costs. 2. Set aside the orders of the Court of Appeal of New South Wales made on 28 September 2001 and, in lieu thereof, order that the appeal to that Court be dismissed with costs. On appeal from the Supreme Court of New South Wales Representation: B W Walker SC with S E Pritchard for the appellant (instructed by Hicksons Lawyers) D F Jackson QC with K J Ryan for the respondent (instructed by Walker Kissane & Plummer) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Whisprun Pty Ltd v Dixon Negligence – Damage – Respondent contracted Q fever while working in an abattoir – Whether respondent suffered chronic fatigue syndrome. Appeal – Issue not raised at trial – Case on which respondent succeeded on appeal was not argued by respondent at trial or on appeal – Whether respondent should succeed on the basis of a new case on appeal. Appeal – Powers of appellate court – Whether trial judge had properly considered the respondent's case – Whether there was objective evidence that respondent suffered chronic fatigue syndrome – Whether respondent's case depended entirely upon the credibility of her account of subjective symptoms. Evidence – Medical reports – Whether medical reports had independent evidentiary value – Whether evidentiary value of medical reports depended on the respondent's credibility – Whether trial judge erred in not considering medical reports as independent evidence that the respondent suffered from chronic fatigue syndrome. Workers Compensation Act 1987 (NSW), s 151G. Supreme Court Act 1970 (NSW), s 75A. GLEESON CJ, McHUGH AND GUMMOW JJ. This case is concerned with facts and the forensic tactics of the parties at trial and an appellate court's perception of them. Special leave to appeal was granted to determine whether a miscarriage of justice had occurred in the particular circumstances of the case and not because the case concerned any important principle of law. The trial judge had dismissed the respondent's action for damages on the ground that her credibility was such that he was not satisfied that she suffered from chronic fatigue syndrome, the condition from which she claimed to suffer. The Court of Appeal of New South Wales set aside the judgment because it appeared to that Court that the trial judge had not satisfactorily considered the respondent's case. So the question for this Court is whether the Court of Appeal erred in holding that the trial judge had not properly considered the respondent's case. That, of course, depends on what the respondent's case was at the trial, not on a hypothetical construction of what could or should have been the respondent's case. Despite its lack of legal significance, the appeal is a fascinating one. It illustrates how an appellate court can perceive a case in a way dramatically different from the case that was run at the trial. And it demonstrates how, when it is so perceived, the trial judge's reasons may not deal adequately with the reconstructed case and appear to have done less than justice to the losing party's case. In arguing the present respondent's case in the Court of Appeal, Mr D F Jackson QC – who had not appeared at the trial – contended that a substantial miscarriage of justice would have occurred if "the evidence was there" and the judge in writing his judgment "overlooked relevant parts of it". In substance, the Court of Appeal adopted this submission. But the evidence that that Court saw as "overlooked" was different from the evidence that Mr Jackson argued had been "overlooked" by the trial judge. He was speaking of evidence concerning infection. The Court of Appeal's reasons deal with "evidence" concerning chronic fatigue syndrome. At the trial, the parties treated this "overlooked" evidence concerning chronic fatigue syndrome as having no relevant evidentiary value unless the trial judge substantially accepted the respondent's evidence as to her condition. Because that is so, the trial judge did not overlook "relevant parts" of the evidence, and there was no miscarriage of justice. Moreover, even if the "overlooked" evidence had relevant evidentiary value independently of the respondent's credibility, we are not convinced that it was sufficient to overcome the effect of the various matters that the trial judge used to make his finding concerning her credibility. Accordingly, this appeal must be allowed. McHugh Statement of the case Sonya Lea Dixon, the respondent, sued Whisprun Pty Ltd ("Whisprun") for damages in the Supreme Court of New South Wales claiming that it had breached the duty of care that it owed to her as her employer. She claimed that this breach had caused her to contract Q fever infection and that she now suffered from chronic fatigue syndrome as a consequence of the infection. Whisprun admitted that it had breached the duty of care owed to her and conceded that she had contracted Q fever infection. But it denied that she suffered from chronic fatigue syndrome. The case was tried by Newman J without a jury. His Honour rejected Ms Dixon's claim of chronic fatigue syndrome with the result that the damages he awarded to her for non-economic loss were lower than the minimum set by s 151G of the Workers Compensation Act 1987 (NSW). Because that was so, he was required to enter judgment in the action for Whisprun. The Court of Appeal (Beazley and Heydon JJA and Davies AJA) allowed an appeal by Ms Dixon against that judgment. Acting under the power conferred by Pt 51 r 23 of the Supreme Court Rules 1970 (NSW), it ordered a new trial of the action. It did so on the ground that "it appears that some substantial wrong or miscarriage [of justice] has taken place in that the plaintiff's claim has not been properly considered." The Court of Appeal held that the trial judge had not given any weight to material in medical reports that were tendered in evidence. Issues The appeal gives rise to a number of related issues: (1) Did the parties conduct the trial on the basis that, so far as chronic fatigue syndrome was concerned, the evidentiary value of the medical reports depended entirely on judge accepting Ms Dixon's evidence? In other words, did the medical reports have issue the chronic evidentiary value on irrespective of what view the judge took of Ms Dixon's credibility? fatigue syndrome the If the parties conducted the trial on the basis that the truth or validity of the statements and opinions in the medical reports depended on the trial judge accepting Ms Dixon's evidence, did the judge err in not considering whether the material in the medical reports assisted Ms Dixon's case? If the reports had independent evidentiary value, did they contain evidence of "objective symptoms" that should or could have McHugh induced the trial judge to find that Ms Dixon suffered from chronic fatigue syndrome? The material facts In April 1994, Ms Dixon contracted Q fever in the course of her employment with Whisprun at an abattoir at Inverell in New South Wales. By July 1994, symptoms of the fever had developed and she was diagnosed in that month as having Q fever after undergoing pathological tests. Q fever is an infectious disease that is prevalent in animals and can be transmitted to humans. Its symptoms are similar to influenza. Infection usually has an acute phase that can evolve into a chronic infection that may be demonstrated serologically, that is, by blood tests. There is a 10-20 percent chance that a sufferer from Q fever may also develop chronic fatigue syndrome. The distinction between chronic Q fever infection and chronic fatigue syndrome that may exist after chronic Q fever infection no longer exists is of great importance in this case. Whether or not chronic fatigue syndrome exists cannot be proved or disproved by an objective test. A diagnosis of the syndrome must rely on statements by the patient as to subjective symptoms. Serological tests carried out in February 1995 indicated that, although Ms Dixon had had an acute episode of Q fever, she did not have chronic Q fever infection at that time. Nevertheless, she claimed that, even if the acute period of infection had ended by February 1995, she suffered chronic fatigue syndrome, as a consequence of the infection, for an extended period (at least up until the trial in August 2000). Between 1994 and 2000, Ms Dixon saw many medical practitioners. She gave a consistent history of suffering from headaches, aches and pains, nausea and fatigue. The approach of the trial judge The trial judge accepted Whisprun's contention that the initial Q fever infection did not cause any symptoms after February 1995. His Honour held that Ms Dixon had recovered from Q fever by February 1995. He was not satisfied that thereafter she suffered from chronic fatigue syndrome as the result of her Q fever infection. Newman J said: "When examined in chief, the plaintiff gave evidence which was consistent with the history of continuing symptoms which she had given to medical practitioners. Because the continuing symptoms are entirely subjective the only issue which arose in the case was whether the plaintiff's account of her continuing symptoms was credible. In other McHugh words has the plaintiff established on [the] balance of probabilities that she has had the symptoms of which she has complained?" In his judgment, Newman J set out many inconsistencies between Ms Dixon's account of what she could and did do and what other evidence showed that she did do. This evidence showed her walking briskly around Sydney, attending race meetings, watching her daughter ride horses, riding a horse herself, driving cars and horse floats, riding on a jet ski and drinking and dancing at a wedding. The learned trial judge also took into account Ms Dixon's evidence that her relationship with Mr Cross, the father of her daughter, had broken up owing to her mood swings and that she told some of the doctors they were still together. His Honour concluded that "the matters raised in cross- examination with the plaintiff and her responses to them effectively destroyed her credibility." Because the existence of her symptoms depended on Ms Dixon's credibility, his Honour was not satisfied that she suffered from post Q fever chronic fatigue syndrome. Having read the whole of Ms Dixon's evidence, we are not surprised that his Honour made the findings that he did in respect of her credibility. Indeed, as is so often the case, his Honour's summary of her evidence and his findings do not convey the full picture of her lack of credibility, a picture that can only be obtained from reading the whole of her evidence. By the time her lengthy cross- examination had finished, the picture of her state of health to which she had deposed in evidence-in-chief had been destroyed. She may well be sick – but it is certain that her illness does not affect her to the extent that she claimed in evidence and recited to doctors. Later, it will be necessary to return in detail to this evidence. The Court of Appeal The Court of Appeal held that Newman J had not properly considered Ms Dixon's case. The Court's reasons were prepared by Heydon JA, Beazley JA and Davies AJA simply agreeing with his judgment. The Court of Appeal held that Newman J had erred in: concluding symptoms; that Ms Dixon's condition rested on subjective failing to make any findings about the existence of symptoms which were observable by the medical experts for themselves, and which they had taken into account; failing to assess the totality of the medical evidence in light of the symptoms observed by medical experts which did not depend on McHugh Ms Dixon's own history, and in the light of their professional experience and assessment of the probability that she was suffering from Q fever chronic fatigue syndrome. In particular, the Court of Appeal held that the trial judge had erred in failing to consider whether Ms Dixon had symptoms that were observable to medical practitioners. If such symptoms existed, then her case did not depend entirely on her credibility. The Court also held that, in assessing Ms Dixon's credibility, Newman J had placed undue weight on trivial discrepancies and had not taken account of the fact that her condition might have impaired her memory. The Court of Appeal said that the "essence of the trial judge's reasoning was to conclude that once the plaintiff's credit and her reliability was damaged in the ways he set out, no further inquiry was called for." He "made no reference to the large quantity of medical evidence, most of which pointed in one direction." The Court said that, having found the witness unsatisfactory in various respects that could be checked, Newman J inferred that she was unsatisfactory in all respects. Objective symptoms In the forefront of the Court of Appeal's reasons for ordering a new trial was the view that the trial judge had erroneously thought that the existence of the symptoms of which Ms Dixon complained depended on her evidence. Newman J had relied on a statement by Dr McGuirk that "there is no way any objective test could either substantiate or disprove" whether Ms Dixon had the syndrome. But the Court of Appeal said that Dr McGuirk was not suggesting that there were no objective symptoms, and that there was objective evidence that the medical experts had taken into account in forming their opinions that Ms Dixon had the syndrome. The objective symptoms included weight loss, abdominal tenderness, pallor and depression and memory impairment. In addition, the trial judge had not referred to the opinions of various doctors that she had chronic fatigue syndrome, the statistical probability of her having the syndrome or considered an explanation for her lack of credibility. The conduct of the trial The trial commenced on circuit at Newcastle on 29 August 2000 and was adjourned on 30 August. It resumed at Sydney on 3 October 2000. Ms Dixon's evidence-in-chief and much of her cross-examination was heard in Newcastle. The plaintiff and the defendant each was represented by senior counsel whose long and extensive experience in the conduct of trials of actions for damages for personal injury was reflected in an appreciation that the best advocacy is selective and economical. Given the medical evidence concerning Q fever McHugh infection and chronic fatigue syndrome arising from that infection, it is not surprising that counsel for Ms Dixon saw the real issue at the trial as whether Ms Dixon was credible when she claimed to be suffering from symptoms that were consistent with that syndrome. Given the mass of surveillance data concerning Ms Dixon, it is not surprising that Whisprun's counsel saw the issue of her credibility as its best chance of succeeding in the action. Because of the way that the parties appear to have conducted their cases, unsurprisingly, Newman J said "the only issue which arose in the case was whether the plaintiff's account of her continuing symptoms was credible." (emphasis added) Because that was so, counsel for each side obviously took the view that going to the expense of calling medical witnesses was irrelevant. If Ms Dixon's evidence was substantially accepted, she suffered from chronic fatigue syndrome and was entitled to substantial damages. If her evidence was not credible, there was no halfway house that would enable the judge to find that she was sick, but only a little bit sick. Upon what evidentiary basis could the trial judge refuse to accept that she was suffering as she claimed and yet find that she suffered from a lesser condition that she did not identify? In some cases, a tribunal of fact may properly refuse to accept either party's case and work out for itself "a view of the case which did not exactly represent what either party said."1 This case did not fall into that category. Ms Dixon's case was conducted on the basis that what she said in her evidence-in-chief and what she had consistently told the doctors was true. Moreover, behind the conduct of the case was the dark shadow cast by s 151G of the Workers Compensation Act. At the relevant time, that section provided that no damages for non-economic loss could be recovered unless Ms Dixon recovered more than a specified minimim amount for non-economic loss. This statutory threshold made it imperative from Ms Dixon's viewpoint that the trial judge accept that she had suffered and continued to suffer from a debilitating chronic fatigue syndrome. Ms Dixon's evidence In her evidence-in-chief, Ms Dixon said that, after working in Sydney, she returned to Inverell where she worked at Coles stacking shelves and at the abattoirs as a casual worker packing meat. She had a relationship with Mr David Cross, became pregnant, and in 1992 had a daughter, Sarah. After the birth of her daughter, she worked at three jobs: at Coles, at the abattoir and at a fruit and vegetable shop. She and Mr Cross bought a house for $89,000 financed by a 1 Williams v Smith (1960) 103 CLR 539 at 545. McHugh mortgage of about $80,000. At the abattoirs, she obtained a full-time job that involved sucking foetal blood into a pipette from unborn calves' hearts. It was doing this work that caused her to be infected with Q fever. She also worked up to four shifts each week at Coles from 3.30pm onwards to near midnight. She also worked on Saturday morning at the fruit and vegetable shop. She continued to work at these jobs until July 1994 when she became sick and was diagnosed as having Q fever. Before the infection, she had taken part in sporting activities – playing hockey, touch football and riding horses. On contracting Q fever, she felt very sick and had headaches and nausea, similar to the flu. She went back to work after eight days but she felt very sick and had to get help at work. In September 1994, she gave a certificate of unfitness to her employer. Her employment was terminated on 21 September 1994. However, she later went back to work although she had difficulty working a full week and had time off because she was sick. She had nausea, vomiting, hot and cold sweats all the time and her head was "just aching". After a day's work, she felt terrible and "just went straight to bed." Her relationship with Mr Cross broke up because "of my being sick, he couldn't cope with my mood swings." She thought that occurred in 1995. She moved in with her parents; the house that she and Mr Cross had bought was sold. Later, she moved out of her parents' house into a shed about 200 metres away. The "shed" has a small kitchen, a bathroom, a laundry and toilet, a small lounge room and two bedrooms. Asked if the "shed" was "still on your parents' property", she replied, "Yep." Since 1994, her condition "fluctuates up-and-down" but it was not as bad as when she first got Q fever. There has been only a little improvement and she has "some fluctuations from day to day and from week to week". She gets headaches a lot, probably three times a week. They could last a couple of hours or all day. When her headaches are really bad, she stays in bed. She gets pains in the joints in the knees, the back and her elbows. In the good weeks, headaches may occur "once or twice". She takes Panadeine Forte and Panadol. When she gets a really bad headache, she gets chest pains and hot and cold flushes and sweats a greal deal. The sweating leaves the bedclothes saturated and has a bad odour. She still vomits and has nausea. On some days, she does not vomit or have headaches but such days are rare. She gets very tired and loses energy. Although she tries, she does not always get the housework done. Even on her best days, she is not able to stand all day on her feet. She gets tired and runs out of energy and always sleeps for some period during the day for "an hour, maybe three hours." She sees Dr Thatcher once or twice a fortnight. He prescribes medication including anti-depressants that sometimes help her. Her appetite is not very good. She has not really had much social life in the last few years although she had been out to a dinner with her parents the previous June for her daughter's birthday. She doesn't feel like going out because afterwards she gets McHugh tired and it takes a couple of days for her to recover. In her mood swings, she is snappy, yells and screams and gets agitated. She also has difficulty in sleeping and has had problems with dizziness. She now has trouble with her memory. Thus, in evidence-in-chief, Ms Dixon presented a picture of a woman who since July 1994 had been severely disabled, had had virtually no social life and had been forced to live with her daughter in a shed on her parents' property. She was unable to work in gainful employment, was in constant pain and discomfort, was regularly nauseated, was tired and lacked energy, was having difficulty in sleeping and was so moody that her unpleasantness had broken up her relationship with Mr Cross. This picture of her condition was entirely consistent with what she had told a number of doctors over several years. The picture that emerged in cross-examination and from three video films and other evidence was different. Initially, when asked whether she owned any property at all, Ms Dixon said, "Yeah, I had. I had." This answer seemed to be a reference to the fact that she and Mr Cross had owned a house which had been sold. Asked whether she owned "any now", she replied, "Just a car and that, that's it." When asked whether she owned any real estate, she admitted that she owned land that she had purchased two years ago with $50,000 she had borrowed. There were four stables on this land and there were two horses there. Asked whether she owned any other land, she said that she did not. However, although the matter is not clear, further cross-examination appeared to reveal that this land contained the "shed" where she lived. Asked why she had not said in her evidence-in-chief that the shed was on her property, she said "I've got no idea." She denied that she did not want the Court to know that she owned property. Ms Dixon said that the only time that she had been on a horse since leaving the abattoir was "when Sarah has had to go to the toilet or something like that, I have held the horse." She said that Sarah had asked her to show her how "I used to ride when I was younger, and I couldn't." Ms Dixon also said that she could not "remember when I last rode a horse." Pressed, she conceded that she had ridden a horse "this year" but could not remember how often. She said that she wasn't quite sure how many times. Cross-examined further, she said that it would rarely be the case that she would ride several times each week. She claimed that she rode only because her daughter hassled her. Cross-examined as to her attendances at pony clubs where Sarah was riding, Ms Dixon said "mostly I sit" and that she could only stand for "maybe an hour". After seeing a video of Ms Dixon at an equestrian event, Newman J commented that she showed "no signs of fatigue on this occasion". McHugh Ms Dixon said that she had to sleep every day and that her mother had to help her with housework because headaches forced her to lie down. But she admitted that she had been at a wedding from 3.00 pm until the bride and groom left. When it was put to her that she was there until 1.00 am the following morning, Ms Dixon said she was "not quite sure". She said that she had "a couple of dances" and "a couple of drinks". She admitted that a photograph of her with the bride showed that she did not look depressed and that she was not depressed that night. Ms Dixon was shown a video of the wedding and other videos. After that, the case was adjourned. It did not resume for nearly five weeks. When the cross-examination resumed, Ms Dixon admitted that she was "not fatigued" at the wedding, that she was "dancing vigorously" and was "drinking beer out of a bottle". But in re-examination she sought to offer an explanation for her vibrant behaviour claiming that the bride had told her that she had put an amphetamine in her drink. When the bride, Michelle Mair, testified, she denied that she had done so or had a conversation to that effect. In his judgment, Newman J refers to this explanation and, although he did not expressly find that Ms Dixon had invented this explanation, his judgment makes it plain that he did not accept it or at all events was sceptical as to its truth. Newman J said that the video of the wedding "demonstrated her to be very active both in terms of dancing and socialising and drinking." Ms Dixon was also cross-examined concerning her ability, while on a visit to see doctors, to walk from a hotel in George Street, Sydney to the Darling Harbour area. However, the cross-examination led nowhere when she said that she could not place where these areas were. She conceded that on one day – it was suggested to her the next day – after seeing a doctor she and her mother caught a taxi to a Wax Works and that they had gone into the Sydney Casino and an aquarium. Mr W K Dodd SC, counsel for Whisprun, suggested that these places were near Darling Harbour. When he suggested to Ms Dixon that she had been on her feet "several hours that day", she replied that she would not have been on her feet "all that day" and that she would have been "sitting and walking". After she had seen a video film of her walking on this visit to Sydney, she conceded that she was "able to walk briskly". When it was put to her that she had walked "three or more kilometres", she said, "I don't think it was that far." Newman J said that the video "showed her walking briskly an extensive distance between Railway Square, Darling Harbour and streets of Sydney." His Honour said that her "actions as depicted in that video were quite inconsistent with the picture she had painted of herself both in chief and in histories to doctors." Asked whether she had gone to race meetings, Ms Dixon said she could not remember going to a race meeting since she left the abattoir. When shown newspaper photographs of herself at race meetings, she admitted that she had McHugh been at meetings at Inverell in October 1997, January 1998 and January 2000 with Mr Cross. She conceded that she was at the January 1998 meeting for four and a half hours but claimed that she would have been sitting down. After being shown a video of the January 1998 meeting, she admitted that she was "walking briskly" when walking around the course. She also agreed that on occasions she was standing while others were sitting, that she went to the bar area and purchased drinks and that she "jumped with exuberance" when she backed a winner. Asked whether she showed any tiredness in the video, she answered "I can't answer that question, I am sorry." Newman J noted in his judgment that Ms Dixon had conceded that she was present at this meeting "for no less that four hours and twenty minutes." His Honour said that the video demonstrated that Ms Dixon was "showing no signs whatsoever of fatigue and was demonstrative of the plaintiff enjoying herself at that meeting." Ms Dixon was cross-examined as to whether she had been to Copeton Dam, a place used for watersports. Her initial answers indicated that she had been there only once at Christmas time with her parents and her daughter. She could not remember indulging in watersports like swimming "or other things". When asked whether she had been "towed behind a speedboat on an inner tube", her guarded answer was "I have been in Nick and Shelly's speedboat, when Sarah was on a tube." When it was put to her that she had been on the tube, she answered "[o]nly in the water, like, not towed." She also denied driving a jet ski. Pressed further about the tube, she said, "I sat on the tube but I couldn't handle it because I don't like swimming in water when I can't see." Asked whether she had been towed any distance, she said, "No, not that I can remember, because I don't like it. They were scaring me." Asked again whether she drove a jet ski, she said, "I got on, I said, with Shelly, and we only went from there to there and I said stop, I can't handle it." Shelly was Michelle Mair. In evidence, Mrs Mair said that in November 1999 she and her husband and Ms Dixon, Mr Cross and Sarah went tubing which involved a boat towing one to three rubber tubes. She said that Ms Dixon was in a tube next to her and that they went for 20 minute runs on four or five occasions. A Mr Andrew Pelja gave evidence about Ms Dixon tubing and driving a jet ski. He said that in tubing "[i]t's up to the boat driver to put them into a whip to bounce over the wake and everything and have a lot of fun." He said that on one occasion – alleged to be the same one Mrs Mair spoke about – Ms Dixon "was on the tube for about 10 or 15 minutes." He was one of those driving the boat. Mr Pelja also testified that at Christmas 1999 Ms Dixon had driven a jet ski. She was "[j]ust riding around on it like we all do, just not as hard as we do." She had ridden as a pillion passenger at first "to show her the ropes and how to use the jet ski and then by herself." Newman J said that he "formed the view that Mr Pelja was a witness of truth." His Honour also said that "the evasive nature of the McHugh evidence she gave in relation to her activities with [the Mairs] at the Copeton Dam did not enhance her credibility." Ms Dixon was also cross-examined about driving, shopping and doing other things in Inverell. She said that such trips would not "exceed more than four or five days" a week. She was taken through a week of car trips she had taken in August 2000. She agreed that on the Wednesday she had left home about 9.30 am and driven to a property where a woman was looking after one of her horses. She left the property at 10.40 am. The following day she left home about 12.25 pm and went into town to a bank where she used an ATM. She then went to Coles supermarket where she met her mother. They went to lunch at the Bridge Cafe. At 1.25 pm she left her mother and drove to a brake centre where she paid a bill. She then drove to a bowling club and paid her father's membership subscription. She then went to a convenience store before driving home. The following day she again drove into town, met her mother at Coles at 11.15 am and again went to lunch with her at the Bridge Cafe. When it was suggested to her that this was "hardly the lifestyle of someone who is stuck at home doing nothing all day", she replied "[w]e would have been doing things, and fixing up errands or something, that was it." After lunch, she and her mother walked to a bank and used an ATM. She then drove home. When it was suggested to her that she did not "dawdle in a very slow fashion as though you were tired or lethargic", she replied, "[j]ust normal, like, I didn't drag my feet." Newman J said that "a video showing the plaintiff moving around the town of Inverell at times in company with her mother, was demonstrative only of the fact that the plaintiff was exhibiting no fatigue." Ms Dixon also denied that she and Mr Cross lived together and could not recall telling doctors in 1998 and 1999 that she lived in a de facto relationship with him. But she conceded that after Mr Cross left Inverell she had gone to the Gold Coast and lived with him for three months in 1995. She also conceded that sometimes he spends "night after night" at her place although she claimed he "comes and goes, because Sarah always wants him." She agreed that she and Mr Cross and two other persons had gone to the wedding to which we have referred "as a group". Asked whether she and Mr Cross were living together, she said, "Like I said David comes and goes." Evidence of them being together at the wedding, at the races and at Copeton Dam also suggested that the relationship was far from over. And if her statements to doctors as recorded in the medical reports in evidence have any probative value, they contain admissions that in 1998 and 1999 she and Mr Cross lived together in a de facto relationship. Mr Nicholas Mair also gave evidence that he regularly visited Ms Dixon's property and that Mr Cross "lives there." Other evidence also suggested that as late as the year of the trial the relationship between Mr Cross and Ms Dixon was a close one. Mr Pelja gave McHugh evidence that, when a dispute arose between Ms Dixon and the Mairs during the year 2000, Mr Cross had gone with her to the Mair's house and that she made threats while carrying an iron bar. Ms Dixon denied that she had threatened Mr Mair and claimed that "David jumped out of the ute with this bar" and that she had taken the bar away from him. Mr Mair also claimed that Ms Dixon had threatened him with the iron bar. The evidence concerning this incident is not only inconsistent with Ms Dixon's claimed condition but it suggests that her account of her relationship with Mr Cross if not false was much closer than she had claimed in her evidence-in-chief. Newman J thought that her evidence concerning her relationship with Mr Cross went to her credibility. The video films, the admissions and evasions of Ms Dixon in cross- examination and the evidence of Mr Pelja made an overpowering case for rejecting the account that Ms Dixon gave in evidence-in-chief and to the doctors concerning her condition. And when that account was rejected, there was no alternative account that could take its place. The Court of Appeal proceedings Despite the many factors that Newman J referred to in rejecting Ms Dixon's case, the Court of Appeal held that he had not properly considered her case. The Court concluded that Newman J had erred in: concluding that Ms Dixon's condition rested entirely on subjective symptoms; failing to make any findings about the existence of symptoms which were observable by the medical experts for themselves, and which they had taken into account; failing to assess the totality of the medical evidence in light of the symptoms observed by medical experts which did not depend on Ms Dixon's own history, and in the light of their professional experience and assessment of the probability that she was suffering from Q fever chronic fatigue syndrome. The transcript of the argument in the Court of Appeal shows that the point of no proper consideration of the medical evidence concerning chronic fatigue syndrome came from the Court itself. Mr D F Jackson QC adopted a suggestion from the Court that "there wasn't a proper trial because appropriate attention wasn't given to all the factors that bore on the issues in [the credibility finding]". But Mr Jackson's argument did not rely on the reasons on which the Court of Appeal later relied. Instead, his argument was directed to establishing that the McHugh trial judge had erred in considering evidence as to whether Ms Dixon had Q fever infection after February 1995. As Mr Jackson said in argument: "The ... medical reports to which I've gone don't really suggest that it's right to say that the medical evidence showed no relevant serology after February 1995. That's really essentially what we would seek to say in relation to the appeal proper ...". The Notice of Appeal on which the Court of Appeal acted was the third Amended Notice of Appeal filed in the appeal. It was filed on the morning of the appeal hearing. Yet it contained no ground that the trial judge had failed to consider the contents of the medical reports as evidence of chronic fatigue syndrome. Instead, the grounds of appeal were directed to his Honour's finding that Ms Dixon had recovered from the infection by February 1995. Ground 1 asserted that his Honour misunderstood and misconstrued the serological data in evidence and the medical opinion thereon. Ground 2 asserted that the finding that Ms Dixon had recovered from an acute episode of Q fever by February 1995 was not medically justifiable. Ground 3 asserted that his Honour's findings concerning non-economic loss based on a closed period of Q fever infection to February 1995 was not sustainable on the evidence. Grounds 4 and 5 dealt with the effect of fresh evidence upon which Ms Dixon sought to rely. Ground 6 asserted that the trial judge had failed to take into account the serological tests done on 4 December 1995 and commented upon by Professor Boughton in his report. Ground 7 asserted that his Honour failed to take into account the opinions of three doctors in respect of his finding that the appellant had recovered from Q fever infection in February 1995. Ground 8 asserted that his Honour failed to take into account Professor Boughton's opinion that impairment of mental concentration and memory made the eliciting of a reliable history difficult in reaching his assessment of Ms Dixon's credibility. Ground 9 asserted into account Professor Boughton's opinion in finding that Ms Dixon's acute Q fever infection ceased in February 1995 and the consequential assessment of damage under s 151G of the Workers Compensation Act. that his Honour failed take Only Ground 8 had the remotest bearing on the issue of credibility or chronic fatigue syndrome. None of the grounds suggested, as the Court of Appeal found, that a miscarriage of justice had occurred because the trial judge had concluded that Ms Dixon's condition rested on subjective symptoms. No ground suggested that it had occurred because he had failed to make findings about the existence of symptoms that were observable by the medical experts. No ground suggested that it had occurred because he had failed to assess the totality of the medical evidence in light of the symptoms observed by medical experts which did not depend on Ms Dixon's own history. No ground suggested McHugh it had occurred because he had failed to consider the observations in the light of their professional experience and assessment of the probability that she was suffering from Q fever chronic fatigue syndrome. Indeed, at the appeal a question arose as to whether even the matters raised in the grounds of appeal were run at the trial. During the hearing of the appeal, Heydon JA pointed out that Mr R J Burbidge QC, who appeared for Whisprun, objected to Mr Jackson's arguments concerning the failure to consider the infection issue because of Coulton v Holcombe2 – a leading case on the right of parties to run a new case on appeal. Heydon JA asked Mr Jackson whether he had "any instructions or material which would give a rebuttal to Mr Burbidge's "I can't point to material that either supports what he is for or supports absolutely what we say ... However, all this material, all the medical evidence was before the judge and the situation in our submission was this ... and the matter with which we wouldn't disagree is this: What he said was because the continuing symptoms were entirely subjective the only issue which arose in the case was whether the plaintiff's account of her continuing symptoms was credible. When we're speaking of the only issue we're speaking about the matters to which the oral evidence was directed and we're speaking there of the continuing symptoms, the issue was whether her account was credible. In determining that issue he had to take into account – and there was nothing to suggest that we said otherwise – all the medical evidence and the consequence of the condition if she had it on the mental processes. He is entitled to find that she's overstating, it's a different thing." Even if Mr Jackson's reply is seen as including a reference to the medical evidence concerning chronic fatigue syndrome – and the context is against such a construction – two matters are clear. First, he had no instructions and was unable to point to any evidence to the effect that Ms Dixon's case at the trial was that the medical evidence had probative value on the fatigue issue independently of the judge accepting her evidence. Instead, reversing the onus, he contended that nothing in the case pointed to the opposite conclusion. Second, at no stage did he argue – apart from in relation to memory lapse – that the trial judge had overlooked the matters that the Court of Appeal held that Newman J had overlooked. (1986) 162 CLR 1. McHugh The Court of Appeal seems to have assumed that the entire contents of the medical reports – including the histories and complaints – constituted independent evidence that was to be treated as if it had been given in the witness box. It seems to have assumed that, independently of Ms Dixon's credibility, the opinions in the reports were in themselves evidence of chronic fatigue syndrome. Indeed, because the medical experts were not called and their reports were not challenged, the Court of Appeal appears to have treated the contents of the reports as important benchmarks against which the parties' cases were to be tested. If the parties had so conducted their cases as to treat the reports as not depending on Ms Dixon's credibility, the failure of the judge to treat the reports in this way or to mention it would be an extraordinary omission. This is particularly so after the judge referred to the evidence of Ms Dixon's mother and Mr Cross's mother as providing some corroboration of Ms Dixon's evidence. It is in the highest degree improbable that Newman J would have mentioned this evidence as corroboration and omitted reference to the medical reports if counsel for Ms Dixon had placed any reliance on them as corroborative evidence of chronic fatigue syndrome which was not dependent upon Ms Dixon's evidence. The record does not disclose any support for the proposition that the case for Ms Dixon ran at trial was that later formulated by the Court of Appeal. Furthermore, it is inherently unlikely that counsel for Whisprun would have accepted that the opinions of the doctors and the complaints to them had independent evidentiary value on the issues respecting chronic fatigue syndrome without insisting on cross-examination of the doctors. It is hard to credit that counsel would have failed to seek admissions from these witnesses that, if the evidence adduced by Whisprun were accepted, Ms Dixon did not have chronic fatigue syndrome or, at all events, that there was a strong probability that she did not. The course taken by Mr W K Dodd SC, counsel for Whisprun, concerning the tender of the medical reports – and for that matter by Mr P Webb QC who appeared for Ms Dixon at the trial – is consistent with counsel accepting that, so far as chronic fatigue syndrome was concerned, everything in the reports depended on the trial judge accepting Ms Dixon as truthful. It is, or at all events was, a common enough practice in New South Wales in cases concerned with psychiatric conditions for psychiatric reports to be tendered on the assumption that the opinion expressed in them depended on the histories in them being proved in the witness box. That is the course that appears to have been taken in this case where no objective test existed to determine whether Ms Dixon had the symptoms of which she complained. Purists may decry this approach to expert evidence, but it saves time and expense. The days are long gone in civil trials in New South Wales when expert witnesses would sit through the whole of a party's or witness's evidence before expressing an opinion on that evidence. Here it McHugh seems plain that counsel proceeded on the basis that, if the credibility of Ms Dixon – the person who gave the histories recorded in the reports – was destroyed, the opinion of each doctor "may have little or no value, for part of the basis of it has gone"3. Apart from the fact that the medical reports were admitted in evidence, there is really no evidence that the case formulated by the learned judges of the Court of Appeal was ever the case that Ms Dixon ran at trial. And the notice of appeal – the third notice of appeal – did not suggest it. Moreover, Ms Dixon's written submissions tell strongly against the way that the Court of Appeal saw the case. Those submissions were filed on 2 May 2001, over four months before the appeal was heard in September 2001. They were signed by Mr Jackson and contained no inkling that the trial judge had erred in the manner that the Court of Appeal subsequently found. The thrust of those submissions was the same as those found in the Third Amended Notice of Appeal. In our opinion, the case formulated by the Court of Appeal was never run at the trial. Several matters point to this being so: The statement by the trial judge as to the only issue in the case. The reasons of the trial judge are usually the best indication of what matters were in issue at the trial. The omission of the parties to call the medical witnesses. The failure of the Third Amended Notice of Appeal to suggest that the trial judge had not properly considered the case of chronic fatigue syndrome. The focus in the Third Amended Notice of Appeal, the written submissions and the argument in the Court of Appeal on the issue of persisting Q fever infection. The lack of any evidence – apart from the existence of the medical reports – to suggest that Ms Dixon's case at trial was as the Court of Appeal's reasons imply that it was. 3 Ramsay v Watson (1961) 108 CLR 642 at 649; cf Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 77 ALJR 1165 at 1174 [49]; 198 ALR 59 at 70. McHugh Accordingly, this appeal must be allowed. It would be inimical to the due administration of justice if, on appeal, a party could raise a point that was not taken at the trial unless it could not possibly have been met by further evidence at the trial4. Nothing is more likely to give rise to a sense of injustice in a litigant than to have a verdict taken away on a point that was not taken at the trial and could or might possibly have been met by rebutting evidence or cross- examination. Even when no question of further evidence is admissible, it may not be in the interests of justice to allow a new point to be raised on appeal, particularly if it will require a further trial of the action5. Not only is the successful party put to expense that may not be recoverable on a party and party taxation but a new trial inevitably inflicts on the parties worry, inconvenience and an interference with their personal and business affairs. As Water Board v Moustakas6 makes clear, a point may be a new point even though it is within the pleadings or particulars. The pleadings and particulars are frequently decisive in determining whether a party is seeking to raise a new point on appeal. But they are not conclusive. To determine whether a party is raising a new point on appeal, it is "necessary to look to the actual conduct of the proceedings"7. Thus in Water Board, the plaintiff's case at trial had been that his employer was negligent in failing to prevent traffic from crossing in to the lane in which he was working. On appeal, the Court of Appeal of New South Wales allowed the plaintiff to raise a case that the employer was negligent in failing to provide a barrier to prevent the plaintiff from straying into the adjoining lane. This Court held that, although this alternative case was within the particulars, it had not been the plaintiff's case at the trial and the Court of Appeal had erred in allowing it to be raised on appeal. As in Water Board, the case for Ms Dixon as formulated in the Court of Appeal is not the case that she ran at the trial. Moreover, it is a virtual certainty that, if such a case had been run at the trial, Whisprun would have wished to 4 University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483; 60 ALR 68 at 71; Coulton v Holcombe (1986) 162 CLR 1 at 8-9; Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 875 [44]; 179 ALR 321 at 330-331; Water Board v Moustakas (1988) 180 CLR 491 at 496-497; cf R v Birks (1990) 19 NSWLR 677 at 5 Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR (1988) 180 CLR 491 at 498. 7 Water Board v Moustakas (1988) 180 CLR 491 at 497. McHugh cross-examine the doctors. Because that is so, the Court of Appeal erred in considering this alternative case. No miscarriage of justice occurred because the trial judge considered the case that Ms Dixon ran at the trial. It follows that the Court of Appeal should have dismissed the appeal by Ms Dixon. The case formulated by the Court of Appeal In any event, we are not convinced that the matters upon which the Court of Appeal relied would have affected the conclusion that Newman J reached concerning Ms Dixon's credibility or her failure to persuade him that she had established that she was suffering from chronic fatigue syndrome. The Court of Appeal held that the trial judge had erred in failing to consider whether Ms Dixon had symptoms that were observable to medical practitioners. The Court said that if such symptoms existed, then her case did not depend entirely on her credibility. However, with great respect to their Honours, none of these symptoms was "objective". They depended on what Ms Dixon told the doctors. Nor can it be said that the only possible cause of these symptoms was chronic fatigue syndrome. Weight loss The Court of Appeal regarded Ms Dixon's weight loss as significant. Ms Dixon reported that she had originally weighed 12-13 stone, and that this dropped to around eight and a half stone. This evidence depends of course on Ms Dixon telling the truth about her earlier weight. But accepting that she did lose three and a half stone in weight, it says very little, if anything, concerning whether she was suffering from chronic fatigue syndrome after February 1995. No one disputes that she had Q fever infection and that it persisted for at least ten months. The infection itself is sufficient to explain the weight loss. What is more significant is evidence that subsequently she put on four and a half kilograms. A weight of nine stone or 57 kilograms (having regard to her height etc) hardly indicates ill health. A photograph of her at Inverell races does not suggest that Ms Dixon was underweight. Weight loss in and of itself does not necessarily point to Ms Dixon having chronic fatigue syndrome. Abdominal tenderness tenderness particularly around The Court of Appeal also considered that Ms Dixon's complaints of abdominal liver supported her case. Abdominal tenderness is consistent with chronic fatigue syndrome. But it is not conclusive of it. There are many other explanations that could account for this tenderness. And the existence of the abdominal tenderness itself appears to depend on the truth of Ms Dixon's responses. The medical reports are silent as to whether a doctor can actually tell by touch or experience whether a patient has the McHugh such tenderness. If a diagnosis of abdominal tenderness depends upon the truth of what the patient says, her abdominal "tenderness" is not objective evidence. A patient may be untruthful or may falsely believe that she has the tenderness. The possibility of a psychosomatic illness of some sort also cannot be ignored. The evidence indicates that, by reason of the poor safety practices of Whisprun, a significant number of its employees have suffered from Q fever infection and chronic fatigue syndrome. Indeed Ms Dixon's father had so suffered. Nor should one ignore the fact that the symptoms of chronic fatigue syndrome largely coincide with the symptoms of Q fever infection from which Ms Dixon undoubtedly suffered for at least ten months. She was undoubtedly aware of the indicia of chronic fatigue syndrome. Her claim of abdominal tenderness, if accepted, supports her case but it falls well short of establishing that she suffered from chronic fatigue syndrome or that her condition was anywhere near as bad as her evidence-in-chief painted. Pale and depressed The Court of Appeal also saw an objective symptom in the observations of doctors who thought that Ms Dixon looked pale and depressed. No doubt her paleness is more "objective" than some of the other symptoms to which the Court of Appeal referred. Nevertheless, Ms Dixon could have been pale and depressed for reasons other than the syndrome. And more importantly, the trial judge saw Ms Dixon in the witness box over a lengthy period undergoing an extensive cross-examination. Compared to his Honour's opportunities to observe Ms Dixon under the stress of cross-examination, the observations of doctors – particularly at times when she was undoubtedly suffering from Q fever infection – seem of little significance. Memory impairment The Court of Appeal also classified as an objective symptom the fact that a number of doctors suggested some impairment of Ms Dixon’s memory. But Newman J heard and observed Ms Dixon give evidence under the stress of cross- examination. He was in a better position than the doctors to form an opinion as to whether there was any impairment of her memory. No doubt some of her answers, as they appear in the transcript, suggest a lack of recollection. But his Honour was in the best position to judge whether this vagueness of recollection represented evasions or genuine lapses of recollection. Moreover, at different points of the cross-examination Ms Dixon's recollection seemed remarkably clear. She seemed to have no difficulty recalling the details of her visits to Inverell on which she was cross-examined. Significantly, at one point she corrected Mr Dodd when he suggested to her that she had taken an envelope into a forklift hire building. She said "you don't mean a forklift – it was – my mum gave me a bill to go and pay for her [at] a brake centre". McHugh In any event, even if she was forgetful it does not necessarily mean that she had chronic fatigue syndrome. She had other worries during the relevant periods. She had had a pregnancy terminated which she concealed from her parents. This was obviously a matter of some concern to her: she claimed that after she had fallen out with her friend, Mrs Mair, she had threatened to tell Ms Dixon's mother about the termination. Failure to consider objective symptoms Contrary to the stance adopted by the Court of Appeal, there was no reason why Newman J was required to give any weight to the doctors' opinions that Ms Dixon was suffering from chronic fatigue syndrome. The opinions themselves seem premised on an acceptance of Ms Dixon's account of her history and complaints. His Honour was entitled to take the view – which we would take ourselves – that their opinions were contingent on Ms Dixon suffering from the problems of which she complained. If she did not, there was nothing in the reports, with the exception of the abdominal tenderness and her paleness, that gave any support for the opinions expressed. The Court of Appeal also considered that the trial judge should have considered that there was a statistically significant chance of Ms Dixon having chronic fatigue syndrome. But Newman J was entitled to take the view that the statistical probability of her having the condition was of no significance after what he had seen and heard from the cross-examination, the videos, the photographs and the evidence called by Whisprun. It is not readily to be supposed that the various matters upon which the Court of Appeal placed so much weight would have induced Newman J to accept that Ms Dixon's condition was as she testified in her evidence-in-chief and as she reported to the doctors. Further, it should not be accepted that Newman J failed, at least in a general way, to consider the matters to which the Court of Appeal referred. The fact that his Honour did not refer to these matters in his judgment is not decisive. A judge's reasons are not required to mention every fact or argument relied on by the losing party as relevant to an issue. Judgments of trial judges would soon become longer than they already are if a judge's failure to mention such facts and arguments would be evidence that he or she had not properly considered the losing party's case. However, it is unnecessary to determine whether the matters to which the Court of Appeal referred were or should have been considered by the trial judge. For the reasons that we have given, they were not part of Ms Dixon's case. To suggest that a trial judge has not properly considered a party's case is a serious charge. Such a suggestion should be accepted only when the record of the trial or McHugh other evidence persuasively suggests that the judge failed to discharge that paramount judicial duty. With great respect to the learned judges of the Court of Appeal, we do not think that the evidence met that standard. Order The appeal should be allowed with costs. The orders of the Court of Appeal should be set aside. In their place should be substituted orders that the appeal to that Court be dismissed with costs. Kirby This appeal concerns the boundaries of appellate power. Specifically, it relates to the powers of an appellate court, conducting an appeal by way of rehearing, to reverse factual conclusions reached by a primary judge who states or implies that such conclusions were based on an assessment of the credibility of a party. Considerations of this kind are not necessarily fatal to appellate reversal of the primary judge's conclusions. It always remains for the appellate court to undertake the appeal by way of rehearing. Such an appeal "should be a reality, not an illusion; if the judges of an appellate court hold the decision of the trial judge to be wrong, they should correct it"8. that showing the primary However, normally, to secure reversal of a primary judge's credibility- based conclusions, it is necessary for the challenger to demonstrate that such conclusions are flawed by reference to incontrovertible facts or uncontested testimony: judge's decision was erroneous, notwithstanding that it appears to be (or is stated to be) based on credibility findings9. Such was the case in State Rail Authority (NSW) v Earthline Constructions Pty Ltd (In Liq)10 ("SRA"). There a witness, disbelieved by the primary judge, was supported by contemporaneous documentary evidence and unchallenged testimony of other witnesses that had not been considered and that evidence combined to demonstrate the fragility of the judge's conclusion. Such was also the case in Fox v Percy11 where the decision of the primary judge, although based on a credibility assessment, could not be reconciled with other testimony that the primary judge accepted. In particular, it did not accord with a contemporary record that contradicted the judge's conclusion. Although, in the present case, the appellate court pointed to certain evidence of uncontested or undisputed facts to help establish the proposition that an incompatibility could be shown (similar to the foregoing cases), that evidence fell short of an objective demonstration that the primary judge "got it wrong". The question therefore arising, in the circumstances of the trial and of the primary judge's reasons in this case, is whether the appellate court's conclusion "that some substantial wrong or miscarriage has taken place in that the plaintiff's 8 Warren v Coombes (1979) 142 CLR 531 at 553. 9 Voulis v Kozary (1975) 180 CLR 177; State Rail Authority (NSW) v Earthline Constructions Pty Ltd (In Liq) (1999) 73 ALJR 306; 160 ALR 588; cf Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd Trading as "Uncle Bens of Australia" (1992) 27 NSWLR 326 at 349-350. 10 (1999) 73 ALJR 306; 160 ALR 588. 11 (2003) 77 ALJR 989; 197 ALR 201. Kirby claim has not been properly considered"12 was correct and can stand compatibly with the grounds of appeal under consideration, the issues that were addressed in the appeal, the applicable law and, in particular, the rule of restraint upon the reversal of a primary judge's conclusions based, wholly or in part, upon findings about the credibility of critical evidence. The facts The basic facts are set out in the reasons of Gleeson CJ, McHugh and Gummow JJ13 ("the joint reasons") and in the reasons of Callinan J14. As is normal in a case of this kind, questions were asked, and evidence was tendered at trial, designed to probe the true extent of the disability of Ms Sonya Dixon (the respondent) in respect of the condition for which she claimed damages for negligence against her former employer, Whisprun Pty Ltd (the appellant). The essential ingredients giving rise to the respondent's claim were not disputed. Before she was exposed to infection with Q fever at the appellant's abattoir in 1994, the respondent was "very healthy"15. This was not simply her own assessment. It was confirmed by her family and friends and by two medical practitioners (Drs Hall and Thatcher). They had seen her professionally before and following the infection. Moreover, it was confirmed by the fact that the respondent, at the time she was exposed to Q fever, held down three jobs – in the appellant's abattoir, at a local supermarket for three days a week and at a fruit market on Saturdays. She was described thus: "She was working to pay off a home mortgage. She was an enthusiastic, reliable and responsible worker. She had had a daughter. Her relationship with her daughter, her de facto husband, his mother and other persons was happy. Until at least 1993 she played hockey, basketball and tip football. She swam. She rode horses. She weighed 12 stone. There was no existing medical condition before July 1994 which could have detrimentally affected her health thereafter."16 12 Dixon v Whisprun Pty Limited (formerly known as Northwest Exports Pty Limited) [2001] NSWCA 344 at [74]. 13 Joint reasons at [8]-[10]. 14 Reasons of Callinan J at [129]-[131], [133]-[139]. 15 Dixon v Whisprun [2001] NSWCA 344 at [55]. 16 Dixon v Whisprun [2001] NSWCA 344 at [55]. Kirby Into this seemingly stable and healthy condition intruded the infection that occurred when the respondent's duties for the appellant obliged her to remove foetal blood from the hearts of unborn calves by a technique involving sucking the blood out with a pipette. The respondent ingested some of the blood. She had not first been administered a vaccine that could have protected her from the agents that cause Q fever. Professor Kendall said that he could think of "no method of ensuring infection with Q fever more certain than the work practice imposed on her". He found "the whole matter really astounding"17. After her exposure, the respondent suffered an acute episode of Q fever commencing in July 1994. Since then, she has been observed and treated by a series of medical practitioners, some of them nominated by the appellant. She suffered symptoms that were initially compatible with both the acute phase of Q fever infection and later with a chronic fatigue syndrome which often follows such exposure. All but one of the medical practitioners who treated the respondent or reviewed her for the purposes of her claim against the appellant found that she was manifesting signs or symptoms that were compatible with the chronic fatigue syndrome, a flu-like condition, of which she complained. The only witness out of step in this regard was Dr Sutherland. He was qualified to give evidence for the appellant. However, it was demonstrated that he had received an incorrect history and was unaware of a bout with Q fever that the respondent had suffered late in 1994. This error, influencing his awareness of the progress of the respondent's condition, falsified Dr Sutherland's conclusion. It left the medical evidence otherwise speaking with a single voice, favourable to the respondent's condition and its aetiology, namely that it was caused by her exposure to Q fever. Nor did the medical opinions favourable to the respondent describe a progress of the condition that was unique or even exceptional. Scientific materials received at trial indicated that at least 10-20% of those exposed to Q fever go on to suffer chronic fatigue syndrome. Whilst in some reported cases the condition clears up quickly after the acute phase, in others the disability endures for "2 or more years"18. In still others19: 17 Professor Kendall cited Dixon v Whisprun [2001] NSWCA 344 at [3]. 18 Marmion et al, "Protracted debility and fatigue after acute Q fever", (1996) 347 The Lancet, 977 at 978. 19 Ayres et al, "Protracted fatigue and debility after acute Q fever", (1996) 347 The Lancet, 978 at 978-979 (footnotes omitted). Kirby "6 years after the outbreak, anecdotal reports suggested that some patients involved in the original outbreak had long-term symptoms, notably fatigue and lethargy. With reports from Australia also suggesting chronic symptoms after acute Q fever, we assessed the prevalence of chronic symptoms in patients originally involved in the acute outbreak in the UK. 114 patients for whom we had current addresses were circulated with a questionnaire based on that used by Marmion and colleagues (personal communication). 102 (90%) responses were received and after removing those who had died or moved away, 83 (70 male) were left for analysis … There was a high prevalence of fatigue (66%), joint aches (69%), sleep disturbance (65%), cough (89%), and sweats (53%) in the Q fever group … There were a number of statistically significant differences between cases … These findings support the view that a chronic, post-acute Q fever syndrome exists which is similar in many ways to chronic fatigue syndrome. Our group was not occupationally exposed and the presence of symptoms in these subjects is, therefore, not coloured by impending litigation." The foregoing scientific evidence, which was not contradicted or qualified, as well as the opinions of treating medical practitioners, was received, in report form, without any objection being raised by the appellant. The appellant did not require, as it might have done, that any of the medical witnesses whose reports were tendered attend court for cross-examination on their reports. The respondent's oral evidence recounted symptoms similar to those described in the scientific studies. Her histories, given to the medical practitioners over the years between her original exposure to Q fever and the trial, were also consistent. They indicated some variation in the severity of her condition from time to time. But they were always compatible with the diagnosis of chronic fatigue syndrome as described in the literature and as recognised by the medical experts who gave evidence. The respondent's complaints were also supported by testimony from her family and others. They were compatible with the signs presenting to the medical experts, qualified to give evidence, who examined her after her exposure to infection for the purposes of evaluating her claim. The respondent's complaints were compatible with the reports of muscle tenderness and abdomen tenderness; with descriptions of her behaviour and appearance pre- and post-exposure; and, most importantly, with the severe weight loss that followed her infection with Q fever and continued up to the trial. The respondent's pre-infection weight of 12-13 stone (approximately 76-83 kg) fell, by May 1995, to 57.3 kg. This weight was maintained to May 1998. By March 1999 it had crept up to 61 kg. However, this was still markedly below her Kirby pre-infection weight. The respondent was never challenged about the weight loss, although she repeated reference to it during her testimony. It was an objective sign that was consistent with her complaint of lethargy, depression and unwellness, interrupted sleep, unreasonable irritability and interference in short- term memory and concentration – all of which (according to the medical evidence) were symptoms common to the chronic fatigue syndrome following Q fever with which the respondent had been diagnosed. Given the appellant's general acceptance of the circumstances in which the respondent was infected; the immediate pre-infection state of the respondent; the resulting acute phase of Q fever; and the uncontested fact that this can, in 10- 20% of cases, lead to prolonged chronic fatigue syndrome, what hypotheses could be propounded to support the termination by February 1995 of the judge respondent's entitlement (Newman J)20? On the face of things it seems arbitrary. But was it? to damages, as found by the primary The primary judge's decision, in effect, confined the respondent's entitlement to damages to the period of acute infection beginning with the pathology tests reported in July 1994 by Dr Hall. Serological tests conducted in February 1995 showed that, at that time, the respondent was not suffering from acute or chronic Q fever infection. However, by this stage, her claim was for "chronic fatigue syndrome", the not uncommon sequel to Q fever exposure. For that syndrome there was no objective pathology test that could incontrovertibly confirm or negate the condition. To ask for, or demand, such positive proof would be to require the impossible. It would be unreasonable and thus unlikely to be the requirement of the common law21. It would risk imposing on the respondent a heavier burden of proof of the continuity of her condition than is required in a civil proceeding claiming damages for negligence. The competing hypotheses As Heydon JA22 pointed out in the Court of Appeal, there were at least four possibilities to explain the respondent's complaints: That she was suffering from "some form of chronic state" wholly coincidental and not connected with her earlier exposure to Q fever; 20 Dixon v Whisprun Pty Ltd [2000] NSWSC 955 at [55]. 21 cf Bennett v Minister of Community Welfare (1992) 176 CLR 408 at 420-421. 22 Dixon v Whisprun [2001] NSWCA 344 at [57]. Kirby That, although she had initially suffered the symptoms complained of as a complication of Q fever, "psychological components and contributants" had taken over to explain her ongoing condition; That her complaints were genuine and attributable to an aftermath of the Q fever exposure; or That she had decided, around February 1995, "to live a complete lie and maintain a consistent but wholly or largely mendacious story to be told to her family, her friends, her doctors, her lawyers and ultimately the court over a period of six years". A fifth possibility, suggested during argument before this Court, was: That she might indeed have been suffering from "chronic fatigue syndrome" consequent upon her exposure to Q fever but, by reason of untruthful evidence and exaggerations at the trial, she had left the primary judge in a state of uncertainty about the extent of the disability attributable to the appellant's negligence. Upon this footing, the rejection of the respondent's claim after February 1995 rested upon her failure to prove that claim in accordance with the burden and standard of proof resting upon her as the plaintiff in the action. The foundations for the credibility conclusion The untruthful evidence and exaggerations upon which the appellant fought its case at trial turned out to be critical for the conclusion of the primary judge. He noted that "the cross-examination [took] the form of a direct attack upon the plaintiff's evidence as to the symptoms she suffered but also as to a number of peripheral matters"23. One such "peripheral" matter (mentioned by the primary judge) gives the flavour of the way her claim was met during the trial. In her evidence-in-chief, the respondent agreed that she lived on her parents' property in Inverell. It transpired that she was housed in a shed which stands on land that she herself owns. She was asked why she had not corrected the questioner and stated that the shed was on her own property. Her answer was that she had "no idea"24. Perhaps, like not a few lawyers before and since, she was not quite sure what "property" meant25. Perhaps she did not think the 23 Dixon v Whisprun [2000] NSWSC 955 at [25]. 24 Dixon v Whisprun [2000] NSWSC 955 at [26]. 25 cf Parsons v The Queen (1999) 195 CLR 619 at 628 [22]; Yanner v Eaton (1999) 201 CLR 351 at 365-371 [17]-[31]. Kirby ownership of the land on which her shed stood really mattered enough to make a fuss so as to correct the questioner's assumption. Much of the cross-examination of the respondent, however, was directed to demonstrating that she had attended events and participated in activities incompatible with her complaints of fatigue. At first, the respondent said that she could not remember that she had attended a race meeting organised by the appellant's abattoir after she left the appellant's employment. However, she was then shown photographs in the local newspaper and a video film proving that she was present at a race meeting on New Year's Day 1998. The primary judge found that the video film showed26 "no signs whatsoever of fatigue and was demonstrative of the plaintiff enjoying herself at that meeting" where she was present for "no less than four hours and twenty minutes". Further video film showed her "walking briskly an extensive distance" in Sydney streets27. The judge said that her "actions as depicted in that video were quite inconsistent with the picture she had painted of herself both in chief and in histories to doctors"28. There followed questions about a Christmas barbecue at the Copeton Dam. The judge described the respondent's evidence in that respect as "evasive" and as such "did not enhance her credibility"29. He detected a difference between the evidence of a witness, Mr Pelja, concerning certain limited watersport activities on the Dam in which the respondent participated and the respondent's recollection about her activities on the given day. However, even Mr Pelja's testimony about the events was imperfect. The respondent was tackled about statements to a psychiatrist that she did not smoke or drink. She explained that she took those questions to refer to regular smoking and drinking. A video film lasting eight minutes at a wedding "demonstrated her to be very active both in terms of dancing and socialising and drinking"30. The judge also viewed a video film showing an equestrian event which the respondent attended and in which her daughter was involved and also showing the respondent moving around the town of Inverell. Neither of these, he felt, 26 Dixon v Whisprun [2000] NSWSC 955 at [30]. 27 Dixon v Whisprun [2000] NSWSC 955 at [31]. 28 Dixon v Whisprun [2000] NSWSC 955 at [32]. 29 Dixon v Whisprun [2000] NSWSC 955 at [36]. 30 Dixon v Whisprun [2000] NSWSC 955 at [39]. Kirby showed the respondent exhibiting the fatigue of which she had complained in evidence31. Although, objectively, one might consider foregoing cross- examination, photographs and video film as having only limited significance when stacked up against the entirety of the evidence called by the respondent and her medical reports and lay witnesses – and her own concession that her condition of fatigue varied over time – this was not the way the primary judge saw it. Despite the evidentiary support that the respondent received from her mother and from the mother of her former de facto husband (to the effect that she had good and bad weeks) the primary judge said32: the "I have concluded that the matters raised in cross-examination with the plaintiff and her responses to them effectively destroyed her credibility. … I am not satisfied, on a balance of probabilities, that the plaintiff has in fact suffered from the symptoms which she recounted to medical practitioners and in chief to this Court." Having treated the question whether the respondent's account of her continuing symptoms was credible as determinative of the claim, the primary judge confined the claim to the short period for which there was objective confirmatory evidence in the form of the serological tests proving (in effect beyond doubt) the presence of the acute phase of Q fever infection. Because of the applicable law, this conclusion led the primary judge to dismiss the respondent's action. The Court of Appeal reversed that conclusion. It ordered a retrial of the respondent's action. By special leave, the appellant has appealed to this Court. The appellant complained that the Court of Appeal had erred in disturbing the primary judge's conclusion that rested on the foregoing reasoning. In particular, the appellant complained that no error had been demonstrated to justify the order allowing the appeal. So far as that order depended on a conclusion that the respondent's claim had "not been properly considered", it involved procedural unfairness to the appellant, in that such a ground had not been specifically relied upon before the Court of Appeal which had thus taken upon itself a function of identifying a flaw in the conduct of the trial of which the respondent had not expressly complained and which the appellant had not been afforded a proper opportunity to answer. 31 Dixon v Whisprun [2000] NSWSC 955 at [46]-[47]. 32 Dixon v Whisprun [2000] NSWSC 955 at [53]-[55]. Kirby Appellate disturbance of credibility conclusions Overseas authorities: The rule of restraint, limiting the power of appellate judges to disturb fact-findings at trial that have been influenced by assessments of the credibility of witnesses, is universal. Appellate courts in Australia33, as in other common law countries, are protective of such findings. The formulas used vary as between different jurisdictions. The principle of restraint is common. Thus, the United States Supreme Court has adopted a rule obliging appellate deference to trial decisions based on credibility assessments unless such decisions are "clearly-erroneous"34. In the New Zealand Court of Appeal, the rule has been expressed that such factual findings may not be disturbed unless "compelling grounds are shown for doing so", sufficient to demonstrate that the primary decision-maker has erred35. In New Zealand, it is necessary for the appellant to show that the impugned fact-finding was "wrong"36. In England, from where the rules observed in Australia are originally derived, new Rules of Court have recently been adopted for application to appeal courts37 in the form of Pt 52 of the Civil Procedure Rules38. These Rules came into force on 2 May 2000 following consideration between 1994 and 2000 of the reform of civil appeals39. Part 52, r 11(3) of the new Rules provides that: "the appeal court will allow an appeal where the decision of the lower court was – (a) wrong; or (b) unjust because of a serious procedural or other irregularity in the proceedings in the lower court". 33 Jones v Hyde (1989) 63 ALJR 349; 85 ALR 23; Abalos v Australian Postal Commission (1990) 171 CLR 167; Devries v Australian National Railways Commission (1993) 177 CLR 472; cf Morrison and Comeau, "Judging Credibility of Witnesses", (2002) 25 Advocates' Quarterly, 411. 34 Anderson v Bessemer City 470 US 564 at 574-575 (1985). 35 Rae v International Insurance Brokers (Nelson Marlborough) Ltd [1998] 3 NZLR 190 at 198 per Tipping J (for himself and Richardson P). 36 Rae [1998] 3 NZLR 190 at 198 per Thomas J. 37 Including the civil division of the Court of Appeal, the High Court and a county court: Civil Procedure Rules, Pt 52, r 1. 38 Civil Procedure, (2002) vol 1 at 1197. 39 England and Wales, The Right Honourable the Lord Woolf, Master of the Rolls, Access to Justice, (July 1996), Ch 14; England and Wales, Sir Jeffrey Bowman, Review of the Court of Appeal (Civil Division), (1997), designed to implement the Kirby The issue of reconsideration of trial fact-finding has been recently considered by the Supreme Court of Canada in Housen v Nikolaisen40. To authorise appellate disturbance of findings of fact made at trial in Canada, the challenger must demonstrate "palpable and overriding error"41. The metaphorical language may be slightly different. But its purport is the same. It is not enough that, on the evidence, the appellate judges would themselves have reached a conclusion different from that reached by the primary decision-maker. Such an approach would involve usurping the functions of the decision-maker at trial and confusing them with the appellate function in fact-finding which is real, but limited and different. The common features of the United States, New Zealand, English and Canadian formulas is therefore that they insist upon appellate restraint; require a demonstration of error; and oblige that such error be "clearly", "compellingly", "palpably" or "plainly" shown. The rule of restraint is not confined to cases where the decision at trial rests, wholly or in part, on conclusions about the credibility of a party or of an important witness. It applies generally to delineate the respective functions of trial and appellate tribunals. Reasons for restraint: Several considerations have been identified as underpinning the rule of restraint42. Such considerations include: The relative scarcity of resources available to the courts to resolve the disputes of litigants and the need to deploy them efficiently; The normal expectation that such disputes will be resolved finally at trial and should not be regarded as merely provisional43; 40 (2002) 211 DLR (4th) 577. 41 Schwartz v Canada [1996] 1 SCR 254 at 279. See also Galaske v O'Donnell [1994] 1 SCR 670; Van de Perre v Edwards [2001] 2 SCR 1014. 42 Housen (2002) 211 DLR (4th) 577. These were not contested by the dissenting judges in Housen. However, it is worthy of note that, although these reasons were not contested by the dissenting judges, in their application, the Supreme Court of Canada was divided. Five Justices (Iacobucci and Major JJ, with whom McLachlin CJC, L'Heureux-Dubé and Arbour JJ concurred) the restoration of the decision reached at trial. Four (Bastarache J, with whom Gonthier, Binnie and LeBel JJ concurred) would have upheld the Court of Appeal's finding of a "palpable and overriding error" on the part of the primary judge that led to its judgment vacating the primary judge's orders. favoured Kirby The need for appellate respect for the autonomy and integrity of primary judges in the discharge of their powers within the scope of their functions44; The acknowledgment by appellate judges of the expertise of many primary decision-makers and the advantages which they often enjoy in hearing and seeing witnesses and in being exposed to the evidence in a case in its totality45; The recognition that appellate procedures are not always well suited to the review of large masses of transcript and are often selective and "telescopic" in their examination of such materials46; and The acknowledgment that the reasons for a primary decision can only ever represent a summary of the main elements that have led the decision- maker to his or her conclusions47. In every case, the appellate court must reconcile the rule of restraint (enhanced where a decision rests on a credibility assessment that was reasonably open to the primary decision-maker) and the need to protect parties against clearly flawed primary decisions, illogicality in reaching them and injustice that demands that the appellate court exercise the functions of review conferred on it by the legislature48. 43 Housen (2002) 211 DLR (4th) 577 at 583 [4]. In Anderson, in the Supreme Court of the United States, it was said that the trial "should be the 'main event' … rather than a 'tryout on the road'", cited in Housen (2002) 211 DLR (4th) 577 at 586 [13]. 44 Housen (2002) 211 DLR (4th) 577 at 585 [11]. 45 cf SRA (1999) 73 ALJR 306 at 330-331 [89]-[92]; 160 ALR 588 at 619-620. 46 Housen (2002) 211 DLR (4th) 577 at 586 [14]. 47 Housen (2002) 211 DLR (4th) 577 at 597 [39]; cf Aktiebolaget Hässle v Alphapharm Pty Ltd (2002) 77 ALJR 398 at 416 [90], 417 [97]; 194 ALR 485 at 509, 510; Biogen Inc v Medeva Plc [1997] RPC 1 at 45 per Lord Hoffmann; cf Van de Perre [2001] 2 SCR 1014 at 1025-1026 [15]. 48 See for example Supreme Court Act 1970 (NSW), s 75A(5), which imposes a statutory duty on the appellate court to hear an "appeal" and to conduct it by way of "rehearing" and s 75A(6)(b) which confers power and duty on the appellate court to draw inferences from the facts. Kirby Authority for intervention: In SRA, I pointed out that findings as to the credibility of a particular witness do not "represent the end of analysis by the appellate court"49. Such findings cannot justify the abandonment or repudiation of a jurisdiction and power conferred on such a court by legislation50. In a lawful discharge of appellate judicial power it would be impermissible to close the appeal books simply because the credibility of a party or witness was raised and decided by the court below. In terms of legal principle it could not be so, given the broad language in which the appellate court's functions are typically stated; the judicial character of the repository of such functions; and the great variety of factual circumstances presented by appeals and by the judicial reasons that give rise to them. In SRA51, I listed a number of cases, illustrated by decisions of this and other courts, in which, despite credibility findings, appellate intervention had occurred and been upheld. As I pointed out in that case, the instances cited were "by no means exhaustive"52. They included cases (1) where the primary judge's conclusion, although expressed in terms of credibility, was "plainly wrong" as demonstrated by incontrovertible facts or uncontested testimony53; (2) where the conclusion was based on evidence wrongly admitted, occasioning a substantial miscarriage of the trial54; (3) where the reasons, going beyond credibility, indicated a consideration at trial of irrelevant matters or a failure to weigh all relevant issues55; (4) where the circumstances in which evidence was given, relevant to credibility, was unsatisfactory56; or (5) where the primary judge had impressions were not made determinative for the judgment in question57. that credibility considerations or it plain 49 (1999) 73 ALJR 306 at 331 [93]; 160 ALR 588 at 620. 50 Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 879 [65.3]; 179 ALR 321 at 337. 51 (1999) 73 ALJR 306 at 331-332 [93]; 160 ALR 588 at 620-622. 52 (1999) 73 ALJR 306 at 331 [93]; 160 ALR 588 at 620. 53 eg Voulis (1975) 180 CLR 177; Gray v Motor Accident Commission (1998) 196 CLR 1 at 36-37 [105], 51-52 [149]; Trawl Industries (1992) 27 NSWLR 326 at 54 cf Paterson v Paterson (1953) 89 CLR 212 at 224. 55 Gray (1998) 196 CLR 1 at 37-38 [105], 51-52 [149]; Watt v Thomas [1947] AC 484 at 487 per Viscount Simon. 56 Commonwealth Bank of Australia v Mehta (1991) 23 NSWLR 84 at 92. 57 Taylor v Johnson (1983) 151 CLR 422 at 426; cf 436-437. Kirby There were two further categories that I mentioned in SRA. They are relevant to the present appeal. They were: (6) where the credibility determination "leaves untouched other evidence which requires separate evaluation with no obstacle of a credibility finding"58 and (7) where, notwithstanding the "extreme and overwhelming pressure"59 of the rest of the evidence at the trial is such as to render the conclusion expressed at first instance so "glaringly improbable"60 or "contrary to compelling inferences"61 of the case that it justifies and authorises appellate disturbance of the conclusion reached at trial and the judgment giving it effect. As Callinan J points out in his reasons62, the categories of appellate intervention listed in SRA are not closed. the credibility finding, The common law usually recoils from absolute rules of mechanical or inflexible application. It does so because its long experience illustrates too often the need to retain elements of flexibility to cover an exceptional case. Unyielding rules (such as would forbid any appellate disturbance of a judgment in any case, in any circumstance in which the primary decision-maker had rested his or her opinion in whole or part on an assessment of credibility) could, in a particular matter, become an instrument of serious injustice. That is why common law rules normally reserve a place for the exceptional case63. The general rule of appellate restraint with respect to disturbing decisions depending on the impression of credibility of a party or witness carries with it exceptions to correct that acknowledge demonstrated error and thereby to prevent a clear injustice. the need, very occasionally, intervene 58 SRA (1999) 73 ALJR 306 at 331 [93.1]; 160 ALR 588 at 620. See also Gray (1998) 196 CLR 1 at 37-38 [105]. 59 The Glannibanta (1876) 1 PD 283 at 287; Paterson (1953) 89 CLR 212 at 219-220. 60 Brunskill (1985) 59 ALJR 842 at 844; 62 ALR 53 at 57. 61 Chambers v Jobling (1986) 7 NSWLR 1 at 10. 62 Reasons of Callinan J at [166]. 63 Such as unidentified error in the exercise of a judicial discretion: House v The King (1936) 55 CLR 499 at 505; or in the residual duty of a court of criminal appeal to scrutinise the verdict of a jury in a criminal trial: Gipp v The Queen (1998) 194 CLR 106 at 152 [131]; or instances of "Wednesbury" unreasonableness: Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 at 228; Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR Kirby The appellate intervention was warranted In the appeal to the Court of Appeal, the respondent relied on objective evidence (such as the undisputed initial infection; the significant, established and persisting weight loss and other signs compatible with chronic fatigue syndrome noted by the medical witnesses in their reports). She also relied on substantially uncontested and apparently reliable observations (including those recorded by the medical witnesses and those that the family and other lay observers related concerning the appearance and conduct of the respondent). She did this in order to build a case of the common kind that would authorise a conclusion by the Court of Appeal that the primary judge's credibility-based findings were contradicted by "incontrovertible facts". The strongest point in this aspect of the respondent's case was the significant weight loss. Obviously, it was an objective sign, carefully recorded over an extended period, including long after February 1996 when the primary judge found that the effects of the exposure to Q fever had no further proved consequences for her health. Certainly, that evidentiary fact was significant. It was given pride of place in the collection of matters to which the Court of Appeal enumerated in justifying its intervention. But as that Court recognised, it was theoretically possible that the weight loss might have had another cause; that the complaints to the doctors were recounted falsely; and that the respondent, after February 1996, set about, effectively, a fraudulent course of claiming continuing disability based upon her general knowledge of the effects of Q fever derived from her own exposure and that of her father at an earlier time. Perhaps over six years she had maintained a diet, resisting all culinary temptations to keep up the litigious pretence so as to bolster the proof of the claim. Against such possibilities there was no knock-out blow in the form of contemporary documents (as in SRA and Fox v Percy) nor an objective serological test (as had earlier proved beyond doubt the initial exposure). However, the lack of the latter form of evidence to clinch the claim of disability was not unusual in the respondent's condition. For such a chronic fatigue syndrome there was no objective test available either to the appellant or the respondent. Accordingly, the lack of an affirmative serology was neutral so far as the acceptability of the respondent's claims and the appellant's dispute about them were concerned. It was this analysis that led the Court of Appeal to the residual categories for appellate review of credibility-based decisions mentioned in SRA and like cases. The question was this: had the primary judge failed to give separate evaluation to the evidence untouched by the testimony of the respondent which he felt to be damaged by his credibility findings so that the evidence would be viewed as a whole and credibility impressions tested against the entirety of the evidence? Looking back over the trial, were the judge's findings in any case (viewed in the context of the rest of the evidence) "glaringly improbable" or Kirby "contrary to the compelling inferences of the case"? Did they suggest that the judge had not considered all of the evidence properly? The Court of Appeal concluded that these questions should be answered in the affirmative. In my opinion that conclusion was open to that Court. Unlike the majority in this Court64, I do not consider that it was open to the primary judge to disregard the medical evidence on the basis that it was undermined by the credibility findings. With respect, this was not a case where the opinion of a medical expert was entirely dependent upon factual assumptions alone, provided by a patient's history so that such an opinion would only be as acceptable as the history on which it was based65. The medical evidence recorded objective signs. At least to that extent it had potential evidentiary value. The scientific evidence was received without objection. It should have been evaluated, as such, by the This Court, whose function is to correct error on the part of the intermediate court, should not retry the case. Its sole function is to decide whether, in intervening as it did in the particular circumstances of the case (correctly described as unusual), the Court of Appeal erred. In my view, only a mechanical and unthinking application of the rule of restraint based on the credibility findings of the primary judge would warrant a conclusion of appellate error which this Court would be warranted to correct. There was no relevant procedural unfairness Grounds and argument of appeal: There is no substance in the complaint that the appellant was denied procedural fairness in the manner in which the Court of Appeal decided the appeal in favour of the respondent. The correctness of the primary judge's finding on the credibility of the respondent at trial was squarely raised in the Court of Appeal by the grounds of appeal to that Court (grounds 1, 2, 3 and 8); by the submissions advanced orally before that Court; by the supplementary submissions filed there on the respondent's behalf; and by the issues raised with the appellant's counsel by the Court of Appeal itself, recorded in the transcript. The Court of Appeal squarely presented the question whether the features of the appellant's evidence that the primary judge found to be unsatisfactory, 64 Joint reasons at [47]. 65 Ramsay v Watson (1961) 108 CLR 642 at 647-649. 66 See for example Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 77 ALJR 1165 at 1180 [88]; 198 ALR 59 at 79. Kirby could itself have been caused, in part at least, by the very disabilities of which she complained. There was medical evidence to support a conclusion that post impairment of mental Q fever chronic fatigue syndrome can result concentration and memory. This fact had been the subject of submissions in the Court of Appeal. There is no indication that the primary judge gave proper consideration to that possibility. Nor, as Heydon JA pointed out67, was there any indication that allowance had been made by the primary judge for the fact that the respondent was "not extensively educated and apparently not very articulate", was probably nervous and alleging a condition which, if present as she claimed, could have affected her testimony because it affected her memory. Instead of analysing the weight and significance of the copious medical and scientific evidence, received without objection on the part of the appellant (including that recording the respondent's consistent record of complaints) and instead of giving attention to the recorded manifestation of signs and symptoms noted by the medical experts (none of whom raised doubts as to the respondent's veracity), the primary judge gave what appears, with respect, to have been disproportionate weight to a relatively small number of photographs and video films that showed, on particular occasions, that the respondent was able to walk and stand and engage in comparatively modest physical activities for comparatively limited intervals of time. It is true that the primary judge did not have the benefit of the oral evidence of medical witnesses concerning the significance of what was seen in the photographs and video films. However, on the face of the evidence of, and concerning, the respondent, there was no such contradiction as justified the very serious conclusion that, in effect, the respondent had persisted for year after year in a false claim of disability or had failed to prove the continuation of her disability according to the civil standard. Both the respondent, and her family and other witnesses, confirmed that she had ups and downs, good weeks and bad weeks, indeed "mood swings" which were compatible with the recorded descriptions of chronic fatigue syndrome following Q fever. In such circumstances, to dismiss her claim, and without proper analysis of the weight, consistency, duration and effective unanimity of the uncontested medical evidence, produced an outcome that demanded appellate correction. It was a disposition of the case in which evidence that required separate evaluation with no obstacle of a credibility finding had been neglected or ignored by the primary judge. It was also one which, viewing the evidence as a whole, had resulted in a judgment that was contrary to the overwhelming pressure of the entirety of the evidence and so was "glaringly improbable" or "contrary to the compelling inferences of the case". 67 Dixon v Whisprun [2001] NSWCA 344 at [64]. Kirby I do not accept that the Court of Appeal reconstructed the respondent's complaints concerning the primary judge's reasons in a way that was unfair to the appellant. The conclusion that the respondent's claim had "not been properly considered" was inherent in the respondent's attack on the credibility-based conclusions recorded by the primary judge. As the cases concerned with complaints of such a kind collected in SRA demonstrate, it is not uncommon (and is often essential) for a party mounting an appeal in which a judge has stated reasons in terms of conclusions about credibility, to attempt to overcome such conclusions in precisely the way that the respondent sought here68. Reference to Supreme Court Rules: The power of the Court of Appeal, in disposing of the appeal is, as Callinan J points out, contained in s 75A(10) of the Supreme Court Act 1970 (NSW)69. That power could not be stated in larger terms. That Court is empowered, relevantly, to "give any judgment … which ought to have been given or made or which the nature of the case requires". The reference by Heydon JA70 to the language of Pt 51 r 23(1) of the Supreme Court Rules 1970 (NSW) was a reference to a rule of court that purports to confine the power of the Court of Appeal to order "a new trial". In another case, a question might arise as to whether that sub-rule is within the rule-making power granted by the Act71, in so far as it purports to cut back the generality of the power conferred by the New South Wales Parliament in s 75A(10) of the Supreme Court Act. A question might arise as to whether such confinement constitutes a rule "for regulating and prescribing the procedure … and the practice to be followed in the Court"72. Such questions do not need to be decided in this appeal, given that the reference to the sub-rule was no more than an indication by Heydon JA of the fact that he had considered the rule that an order for a new trial should only be made if a "substantial wrong or miscarriage" had taken place73. In his view it had. I do not read Heydon JA's reasons for the Court of Appeal as suggesting that the limitation expressed in Pt 51 r 23(1) of the Supreme Court Rules is, in 68 See for example SRA (1999) 73 ALJR 306 at 331-332 [93]; 160 ALR 588 at 620- 69 Reasons of Callinan J at [163]. 70 Dixon v Whisprun [2001] NSWCA 344 at [74]. 71 Supreme Court Act 1970 (NSW), s 124. 72 Supreme Court Act 1970 (NSW), s 124(1)(a). 73 Dixon v Whisprun [2001] NSWCA 344 at [74]. Kirby some undefined way, elevated into a positive ground for intervention in every case where a "substantial wrong or miscarriage" is shown. The Court of Appeal's reasons negative such an interpretation. Clearly, the Court of Appeal considered that, when the whole of the evidence at the trial was taken into account, the rejection of the respondent's case on credibility grounds was unpersuasive. Whether expressed in terms of an affirmative conclusion that the respondent had pursued a false claim after February 1996 or in the negative terms that she had not proved her disability after that date, the Court of Appeal considered that the primary judge's reasons were unconvincing. Stacked up against the objective evidence that was available having regard to the nature of her condition, the consistent record and recorded opinions of the medical experts received without qualification or objection and the limited considerations on which the adverse credibility finding was based, I have no doubt that the Court of Appeal reached a conclusion that was open to it. Rationality of the trial and appellate process Rational process v tournaments: Lying at the heart of the difference between the majority and the minority in this Court (and between the approach of the primary judge and of Heydon JA in the Court of Appeal) is a different notion of the function of a trial judge in a case such as the present. With respect, the joint reasons in this Court, and the reasons of the primary judge, appear to approach that function as if the judge were the successor to the adjudicator of the combat of knights of old – in a kind of public tournament between parties. In my view, we have travelled some distance since those times. The modern civil trial process is a more rational undertaking. It is based upon a close analysis of the relevant evidence, evaluated by a competent decision-maker who is obliged, if a judge, to give reasons which explain the decision arrived at. In this case, Heydon JA (for the Court of Appeal) and Callinan J and I in this Court, do not accept that the primary judge gave to the evidence – and all of it – the consideration that should have been given74. If the primary judge simply viewed the case as a contest mainly about whether the respondent, in her evidence, was a credible witness, that would have been a departure from the judge's function. The law has advanced since the days when truth was distinguished from falsehood at trial by battle and ordeal75 or by their modern 74 Reasons of Callinan J at [161], [169]. 75 Holdsworth, A History of English Law, 7th ed (1956) vol 1 at 308-312. Kirby equivalent – conclusive judicial assessment based on impression and on necessarily limited evidence76. Lies and civil proceedings: Some judges in the past regarded untruthful evidence – even about peripheral or irrelevant matters – as fatal to a litigant. Most judges today understand that the evaluation of evidence involves a more complex function, requiring a more sophisticated analysis. Courts, after all, are not venues for the trial of the parties' morality or credibility, as such. As judges often explain to juries in criminal trials, people sometimes tell lies in court and elsewhere for extraneous and irrelevant reasons, having nothing to do with the legal issues in the trial77. If this is true in criminal trials, it is equally true in civil trials. What is important is not the proof of untruthfulness, as such, but the significance (if any) of any demonstrated falsehoods for the issues at trial. That significance can only be judged when measured against the entirety of the relevant testimony. By its logical force, that testimony may well require that falsehoods be ignored as irrelevant or immaterial to the decision-maker's ultimate conclusion. In particular cases, it may require the decision-maker, within the pleadings, to consider and decide a case different from – or even contrary to – that advanced by the party, because such is the legal entitlement of the person concerned78. Obligations of this kind recognise the ultimate duty of the decision-maker in an Australian court to decide a case according to law and the substantial justice of the matter proved in the evidence, not as some kind of sport or contest wholly reliant on the way the case was presented by a party. Litigants are represented in our courts by advocates of differing skills. Litigants are sometimes people of limited knowledge and perception. Occasionally, they mistakenly attach excessive importance to considerations of no real importance. In consequence, they may sometimes tell lies, or withhold the entire truth, out of a feeling that they need to do so or that the matter is unimportant or of no business to the court. This is not to condone such conduct. It is simply to insist that, where it is found to have occurred, it should not deflect the decision-maker from the substance of the function assigned to a court by law. 76 cf Fox v Percy (2003) 77 ALJR 989 at 995 [30]-[31]; 197 ALR 201 at 209-210. 77 Broadhurst v The Queen [1964] AC 441 at 457; Zoneff v The Queen (2000) 200 CLR 234 at 257-258 [57]-[58]. 78 Williams v Smith (1960) 103 CLR 539 at 545 noted in Suvaal v Cessnock City Council [2003] HCA 41 at [116] by McHugh J and myself. Kirby Reading through the transcript of the trial in the present case (described at unusual length in the joint reasons79) I am left with a reminder of the features of jury trials in days gone by. The advocate tackled the respondent with a view to damaging her credibility. She was a soft target – a former abattoir worker, of limited education, inarticulate, living in a country town, with an alleged medical condition one feature of which was its possible impact upon her powers of concentration and memory. In the old days of civil jury trials, parties would fight such cases with as much bluster and prejudice as they could respectively get away with. In this trial, considerable latitude was allowed. But, in the end, objectively at least, what did the attack prove? That the respondent, on isolated occasions, when cameras were present, was able to partake in some recreational activities? That she was able to walk briskly over three kilometres on a kind of outing while in Sydney attending a medical appointment? That she was not entirely truthful or clear about her property holdings or about her relationship with a de facto partner who was the father of her child? That she had horses which she rode more often than she admitted? And that she joined one night in the exuberance of a country wedding and drank alcohol there like most of the other guests? Consideration of all the evidence: A rational approach to the respondent's entitlements would make full allowance for such evidence – and the dents that it made into her assertions of general fatigue. But it would also make sure that it had taken into full account the objective and consistent evidence in the case. These included the respondent's clear initial infection with Q fever, her protracted weight loss and other consistent recorded signs, and the extensive evidence about the well documented features of this particular infection (including extended fatigue during the phase following acute infection and ups and downs of symptoms of exhaustion thereafter). To reduce the case to a simple contest of credibility was to fall into the trap of irrationality and the risk of prejudice – turning the court's process into one of punishing the respondent for her forensic performance instead of evaluating the objective testimony in the context of all of the evidence called at the trial. Such evidence included powerful, indeed uncontradicted, medical and scientific reports about the course which an infection with Q fever sometimes takes. Lawyers naturally like the objective proof provided by the results of serological tests. However, the problem with Q fever and its aftermath, according to the evidence, is that serological tests are not always conclusive except during the initial acute phase. To do justice to both parties, the decision- maker was therefore obliged to enter upon a more detailed analysis: not to treat the case as a kind of sport, where a player whose credibility is damaged is inevitably judged the loser. Engaging in this kind of tournament can be 79 Joint reasons at [21]-[36]. Kirby comparatively easy for skilled, repeat players. The obligation to assess the claim justly, according to the entirety of the evidence and according to law, is rather more difficult, tedious and time consuming. When our system of civil trials substantially replaced the intuitive decisions of lay jurors with the reasoned opinions of professional judges, a higher standard of manifest rationality was required. The elements of the game were replaced by a more serious evaluation of the evidence and the clear demonstration of just and lawful outcomes. Courts of Appeal reinforced this change by their statutory duty to conduct appeals by way of rehearing – precisely as the Court of Appeal undertook in this case. It is a mistake to apply to the appellate reconsideration of judicial reasons the extreme restraint that was voiced in earlier times in appeals from judgments based on jury verdicts80. I find it impossible to believe that the respondent's counsel at trial and on appeal, addressing the flaws in his client's own evidence, as demonstrated by the appellant – did not in the end rely on the strengths of the case. These were the initial infection, the objective recorded signs and the medical and scientific evidence about chronic fatigue following infection with Q fever. I do not accept that, at trial or on appeal, the respondent rested her case entirely upon the claim of acute Q fever infection, to the exclusion of her post exposure fatigue. If counsel at trial were as experienced as the joint reasons suggest81, it would have been irrational and irresponsible in the extreme to have taken such a course. The serological tests did not support it. Plenty of other evidence which had been tendered, showed the pattern of the Q fever condition as sometimes following the precise course recorded in the respondent's case – years of chronic fatigue syndrome, with ups and downs in the severity of the symptoms. The difference between the approach that I favour and that contained in the joint reasons turns on a possible misunderstanding in those reasons about the meaning of the word "infection". An "infection" may be acute. But, in its later stages, it may be post acute or chronic. It is still, in a sense, an "infection". The "chronic fatigue syndrome" is not an entirely separate and different medical condition just because it is given a different label. It remains a consequence of the initial "infection". The sources of some infections remain in the body although they may be such as to render their presence undetectable to currently available serological tests. According to the evidence, this is the case with Q fever. Yet, instead of dealing with the respondent's condition on this footing, a simple way out was taken. She told some lies; so she was disbelieved and lost her case. The hard task of evaluating all of the medical and scientific evidence 80 Naxakis v Western General Hospital (1999) 197 CLR 269 at 282-283 [40]-[41], 81 Joint reasons at [18]. Kirby and weighing it as against the lies, was thereby avoided. A judge's assessment of credibility (as if that were a universal phenomenon) was allowed to trump rationality, involving the meticulous examination of all of the evidence viewed as a whole. My approach may make me a "purist" in the eyes of those who hold different views82. If that be so, I must live with the epithet. I gladly do so because I am not alone in my opinion and because purity in the stream of law and justice is the responsibility of this Court, not something to be despised. It follows Conclusion – no error shown: substantially correct in his analysis and correct in the conclusions that he and the Court of Appeal arrived at. That Court was right to dismiss the superficial approach accepted at trial and urged on appeal by the appellant. Correctly, Heydon JA assumed the burden of analysing the whole of the evidence objectively, paying proper regard to the primary judge's findings on credibility. No error has been shown to authorise disturbance by this Court of the orders of the Court of Appeal made on the basis of Heydon JA's painstaking analysis. Order The appeal should be dismissed with costs. 82 Joint reasons at [47]. Callinan The facts The respondent contracted Q fever in the course of her employment by the appellant at its Inverell abattoir in 1994. Q fever is an infectious disease which, as a causative organism known as Coxiella burneti, is prevalent in cattle. It is transmissible to human beings and causes symptoms similar to influenza. The respondent's work exposed her to a serious risk of contracting the infection. The appellant negligently failed to eliminate or reduce that risk by arranging for the respondent to be vaccinated before requiring her to do the tasks that caused her to be infected. The appellant conceded negligence shortly before the trial began. Q fever typically involves an acute stage that may in turn evolve into a chronic infection demonstrable serologically. In 10-20% of cases, Q fever may persist as a post Q fever chronic fatigue syndrome. This is a clinical diagnosis, based very largely, but perhaps not entirely exclusively on subjective symptoms, which cannot be readily disproved by any objective test. The respondent was first seen by Dr Hall of Inverell on 27 July 1994. She was diagnosed as suffering from Q fever after pathological tests had been performed. Subsequent serological tests carried out in February 1995 revealed that whilst the respondent had an acute episode of Q fever, she did not have chronic Q fever infection. The respondent was seen by a large number of medical practitioners and presented to all of them, with one exception, a consistent history of continuing headaches, nausea and fatigue. If the respondent's claims of symptoms were true it followed that she suffered from post Q fever chronic fatigue syndrome and was significantly disabled. The procedure adopted by the parties It is convenient to deal with other relevant factual matters in discussing the trial and the appeal to the Court of Appeal. The problem in this appeal arises, because, with no doubt, the best of intentions, but quite mistakenly, the parties chose not to call, or require for cross-examination any doctors who could speak to the respondent's true condition, the controversial matter of substance that the Court had to decide. How anyone could possibly imagine that that controversy could satisfactorily be resolved without testing the conflicting opinions in cross-examination eludes me. There will be cases in which it will be possible and convenient to rely simply on written materials, but that reliance will not only be misplaced but also will produce much less expeditious and efficient outcomes when a material controversy has to be resolved. This is so despite the enthusiasm in some quarters for radical change to longstanding orthodox procedures. The appellant's submission that the way in which the trial was run was a demonstration of pragmatic efficiency is certainly not made out. The presence of the case in this Court is sufficient to make that point. A further problem that Callinan frequently, and here graphically presents itself, when written medical reports only are relied on, is the status of the plaintiff's statements to the doctors: are the reports, because of an apparently unqualified acquiescence in their tender, evidence of the truth of the plaintiff's statements reproduced in them; are the statements only admissible as admissions against interest to the extent that they are prejudicial; to what extent do the relevant provisions of the Evidence Act 1995 (NSW) particularly Pt 3.3 thereof83 bear upon these statements? No attempt was apparently made by anyone to address these questions before or during the trial. As will appear, Heydon JA in the Court of Appeal was alive to the problem which the course adopted presented. Absence of reference by the parties to the Evidence Act or to the status of the contents of the reports at the trial means that the questions that I have posed simply remain unanswered. The trial The respondent did give oral evidence however and was extensively cross- examined at the trial. To demonstrate the division between the experts, and therefore the nature and magnitude of the serious controversy at trial, it is sufficient to refer to extracts from reports made by only two of the medical experts. The respondent relied on several doctors including Professor Boughton. On 23 February 2000 he wrote a report generally consistent with other reports that he made from time to time, and in which, among other things he said: "The sequence of events according to the history given to me, is that of a previously fit girl active in many sports, positive and hardworking, who held two jobs simultaneously, was entrusted with a responsible task at the abattoir because she was conscientious; she acquired preventable Q fever in a highly dangerous situation, as a result of which her health has been severely affected since 1994. To become depressed, anxious, upset, angry, and demoralised, is a perfectly normal reaction to such marked incapacity. I see no abnormal or inappropriate response to this personal disaster by this girl. From what can be determined, this girl was psychologically normal prior to the Q illness; the latter would be wholly responsible for her current psychological and physical status. Finally there is no getting away from the fact that the severe disability this girl has suffered for the past six years was completely preventable by immunisation against Q fever using the then available Q vaccine. In view of the extremely high risk of infection by Q to which she 83 See HG v The Queen (1999) 197 CLR 414 at 427 [39]. Callinan was exposed in the course of her work, she should have been vaccinated before ever being allowed into the slink room." One of the doctors upon whom the appellant relied was Dr Sutherland. He gave this opinion in writing on 6 September 1999: "Mrs Dixon developed an occupationally acquired Q fever infection in mid to late July of 1994. There is no history of an incapacitating illness at that time or shortly thereafter, and so it must be assumed that she suffered a relatively minor acute illness, or perhaps even an asymptomatic infection, from which she recovered rapidly. Mrs Dixon conceived in late September or early October of 1994, and this event, and the subsequent need to deal with the pregnancy, coincided with the onset of her current complaints. The temporal association is compelling, and if any attempt is made to attribute Mrs Dixon's complaints to some adverse life event, then the link would be with events surrounding the pregnancy, and not with the seemingly unremarkable acute Q fever infection some three months earlier. A consultant psychiatrist has deemed Mrs Dixon to show evidence of abnormal illness behaviour, in the form of a somatoform disorder, and this would appear to be the most reasonable explanation for her symptoms. On the basis of all the evidence available, there is no reason to link Mrs Dixon's current complaints and claimed incapacity with the acute Q fever infection she sustained in the course of her work in about July of 1994, nor with any other aspect of the nature and conditions of her work at Northwest Exports abattoir in Inverell." The respondent submitted that Dr Sutherland's conclusions were shown to be wrong because they failed to take account of a recurrent disabling bout of illness after the termination of her pregnancy. Even so, the fact remains that the widely divergent pre-trial opinions provided a clear indication of what the battle ground at trial would be. The respondent's action was commenced in Newcastle in August 2000 by Newman J and adjourned to Sydney in October 2000. In addition to the plaintiff's oral evidence, the trial judge heard evidence from a number of lay witnesses called on her side. His Honour was also shown video films one of which depicted the respondent "dancing and socialising and drinking" at a wedding at a time when she claimed to be suffering disabling symptoms. Another video film showed the respondent at an equestrian competition in which her daughter was competing, and a third showed the respondent moving actively around Sydney. The trial judge formulated the issue before him in these terms: Callinan "When examined in chief, the plaintiff gave evidence which was consistent with the history of continuing symptoms which she had given to medical practitioners. Because the continuing symptoms are entirely subjective the only issue which arose in the case was whether the plaintiff's account of her continuing symptoms was credible. In other words has the plaintiff established on a balance of probabilities that she has had the symptoms of which she has complained." His Honour, after summarizing the medical evidence, made a number of findings adverse to the respondent's credibility and to her claims of fatigue and lethargy. There was an evidentiary basis for findings of that kind. His Honour concluded that matters raised in cross-examination of the respondent and her responses to them effectively destroyed her credibility. He said this: "While senior counsel for the plaintiff submitted that the matters going to credibility were not put to any doctor in cross-examination (all doctors' evidence was received by way of reports) the fact is as I have earlier mentioned, that the on going symptoms from February 1995 are matters for which no objective tests can be performed by medical practitioners to ascertain whether the symptoms in fact exist. I have formed the view that from the time when the plaintiff had recovered from the acute episode of Q fever, which the serological evidence indicates was in February 1995, I am not satisfied, on a balance of probabilities, that the plaintiff has in fact suffered from the symptoms which she recounted to medical practitioners and in chief to this Court." Because the damages which would otherwise be awarded fell short of the relevant threshold for which the Workers Compensation Act 1987 (NSW) provided, the trial judge dismissed the respondent's action with costs. The appeal to the Court of Appeal The respondent appealed to the Court of Appeal of New South Wales (Beazley and Heydon JJA and Davies AJA). Beazley JA and Davies AJA concurred in the judgment of Heydon JA, that the appeal be allowed and that there be an order for a new trial. It was accordingly unnecessary for the Court of Appeal to deal with an application that the respondent had made to adduce fresh evidence in the appeal. In the Court of Appeal the respondent relied in particular on three matters involving the interpretation of passages in the respondent's doctors' reports. First, it was contended that the trial judge had overlooked a reservation in one report (Professor Boughton, 12 December 1995): Callinan "These results … should be repeated … in (say) six months time to confirm …" and had thus erred in finding: "The serology testing which established that the plaintiff did not have a chronic infection was carried out in February 1995. In a report dated 8 May 1995, Dr Thatcher stated that the results of the serology carried out showed that she has had Q fever but does not have a chronic infection. Again there is no evidence before me to suggest that Dr Thatcher's diagnosis in this regard was other than correct. Indeed, the evidence of all medical practitioners on this topic coincides [with] the views expressed by The second was a criticism of the conclusion of the trial judge that I have quoted by reference to various passages in several of the medical reports said to be inconsistent with the trial judge's finding that there was no serological evidence of chronic infection. These passages, it was contended, were at variance with his Honour's finding that the respondent had recovered from Q fever infection by February 1995. The third proposition was that in reaching his assessment of the respondent's credibility, the trial judge failed to take into account the opinion of Professor Boughton that impairment of concentration and memory made the eliciting of a reliable history difficult. The respondent's grounds of appeal involved no express complaint about the trial judge's adverse findings as to her credibility. As Heydon JA said, "[t]he plaintiff did not in terms assault [the credibility findings] by saying that they should never have been made". His Honour added: "Nor did the plaintiff's counsel deny that she had been shown in cross- examination to have been wrong in some respects, and to have gilded the lily. The plaintiff's submissions were largely not explicit. Often they went no further than to offer half-hints at implications which the court ought to make for itself. On occasion the submissions became subliminal. Taken by themselves, the arguments just described, so far as they were explicit, do not assist the plaintiff sufficiently to justify ordering a new trial, though if there were a new trial, their full development at that trial might well assist the plaintiff's cause. But those arguments are material, taken with other difficulties, in identifying certain weaknesses in the trial judge's reasoning now to be discussed." Heydon JA was of the opinion that the trial judge had erred in these respects: Callinan "First, the trial judge's construction of the evidence which led him to the view that a conclusion about the plaintiff's condition could only rest entirely on her subjective symptoms was wrong. Secondly, he failed to make any findings about the existence of symptoms which were observable by the medical experts for themselves and which they took into account. Thirdly, he failed to assess the totality of the medical evidence in the light of the symptoms observed by medical experts which did not depend on the plaintiff's own history and in the light of their professional experience and assessment of the probability that she was suffering from Q fever chronic fatigue syndrome." His Honour was also of the opinion that the trial judge had been overly critical of the respondent's evidence and that, on his analysis, several of the discrepancies and inconsistencies in it were no more than trivial or readily open to much less unfavourable inferences. Some of these Heydon JA thought, were explicable by a matter to which the trial judge did not advert, that the respondent's condition fluctuated: she had good days as well as bad ones; and that under the impetus of impulse, or necessity, or a desire for distraction or pleasure, she might exert herself in ways for which she might pay afterwards. Perhaps the strongest criticism of the primary judge's approach was that he disregarded a number of objective pieces of evidence confirmatory of the respondent's complaints. It is convenient to deal with these in discussing the appellant's submissions in this Court which were equally critical of the approach of the Court of Appeal to them. The matters to which Heydon JA referred, were sufficient in his opinion to cast serious doubt upon the correctness of the result of the trial and the process by which it was reached. The most important of these, his Honour clearly thought was the primary judge's failure to deal adequately and satisfactorily with all of the medical evidence. In the circumstances, there were sufficient doubts and questions to make it just to order a new trial on the basis that, in the language of Pt 51 r 23(1) of the Supreme Court Rules 1970 (NSW), it appeared that some substantial wrong or miscarriage had taken place in that the respondent's claim had not been properly considered84. 84 "51.23 New trial (1) The Court of Appeal shall not order a new trial: (a) on the ground of misdirection, non-direction or other error of law; (b) on the ground of the improper admission or rejection of evidence; (c) where there has been a trial before a jury, on the ground that the verdict of the jury was not taken upon a question which the trial judge was not asked to leave to the jury; or (Footnote continues on next page) Callinan The appeal to this Court Very much at the heart of the appellant's submissions in this Court was the contention that this, being a case of subjective symptoms, was one in which it was for the respondent to convince the Court that the symptoms were both genuine and caused by the appellant's negligence: and, in consequence, the persuasiveness of the respondent's evidence and demeanour in the witness box, particularly in the absence of oral evidence from doctors, were critical and matters in respect of which the primary judge had an overwhelming advantage over any appellate court. The appellant submitted in this Court that it is settled that the respondent should be bound by the conduct of her trial85, and that the Court of Appeal erred in ordering a new trial on the basis of its own detailed analysis of the transcript and exhibits, and identification of errors in the approach of the trial judge, undertaken without reference to the parties, or by reference to an appropriate ground of appeal. It is possible to deal with the latter part of this submission immediately. The respondent's grounds of appeal to the Court of Appeal necessarily required that Court to look at all of the evidence and to compare the respondent's oral evidence with the medical evidence in the reports at length. The third submission of the appellant is that the Court of Appeal effectively treated the history narrated by the respondent to various doctors as evidence of the fact, or at least, when coupled with the absence of comment on it by the doctors concerned, as a circumstance from which it could draw inferences of fact. The appellant pointed out that no reliance was placed by the Court of Appeal, or by counsel there on s 7286 of the Evidence Act, the effect of which (d) on any other ground, unless it appears to the Court of Appeal that some substantial wrong or miscarriage has been thereby occasioned." 85 University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483; 60 ALR 68 at 71; Coulton v Holcombe (1986) 162 CLR 1 at 8-9; Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 875 [44] per McHugh J; 179 ALR 321 at 331; Water Board v Moustakas (1988) 180 CLR 491 at 496-497; cf R v Birks (1990) 19 NSWLR 677 at 683-685 per Gleeson CJ. 86 "72 Exception: contemporaneous statements about a person’s health etc The hearsay rule does not apply to evidence of a representation made by a person that was a contemporaneous representation about the person’s health, feelings, sensations, intention, knowledge or state of mind." Callinan could be to make admissible the respondent's out of court representations to prove the truth of assertions in them – but only if, and to the extent that, the representations were "contemporaneous". Very little, if any of the material, it was submitted, could seriously be regarded as answering this description, the word used by the doctors, "history", being a better description of its true nature. Nor, it was pointed out, was s 60 of that Act87 relied on by the respondent at the trial. The appellant makes the point that even if the doctors had been called to give evidence they would not have been permitted to express any opinions about the severity and genuineness of the respondent's complaints, or indeed about her honesty generally. A further submission was that the respondent's appeal to the Court of Appeal was governed by the decisions of this Court in Warren v Coombes88 and Abalos v Australian Postal Commission89, and that State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In liq)90 which, because it was a very special case, had nothing to say about this one. Much of the appellant's time in oral submissions was taken up with an analysis and criticism of the reliance that Heydon JA placed upon a number of the objective symptoms and history of the plaintiff which in his Honour's opinion the primary judge had disregarded. With respect to this, and as Heydon JA pointed out, before identifying the relevant objective factors, difficulties do arise whenever, and as here, the experts did not always differentiate between the assumed facts and the opinions advanced with the result that the trier of fact (and, it follows an appellate court considering factual findings) will be confronted with problems in deciding how far the opinions can stand in the light of the particular facts found. The first objective piece of evidence to which Heydon JA pointed was the plaintiff's claimed loss of weight of some three or four stone. She was not cross-examined about this. The appellant submitted that this was not an 87 "60 Exception: evidence relevant for a non-hearsay purpose The hearsay rule does not apply to evidence of a previous representation that is admitted because it is relevant for a purpose other than proof of the fact intended to be asserted by the representation." 88 (1979) 142 CLR 531. 89 (1990) 171 CLR 167. 90 (1999) 73 ALJR 306; 160 ALR 588. Callinan objective piece of evidence as no doctor had weighed the respondent before she became ill. In my opinion, it was a relevant matter of some importance and deserving of some consideration by the trial judge. The second objective factor was muscle and abdominal tenderness as to which, the appellant submitted, the courts had only the respondent's word. I do not think that this is so. As Heydon JA pointed out, the presence of tenderness was recorded by a doctor who palpitated various parts of the respondent's body and who also found some slight epigastric tenderness. Other doctors on other occasions made similar observations following physical examination. The respondent was examined by experienced doctors who no doubt made their examinations in such a way as to distinguish between real and actual tenderness, and any feigned or psychosomatic conditions. Heydon JA was right to regard the tenderness as supportive to some extent at least of the respondent's claims, and again a matter worthy of consideration. The third matter was the respondent's appearance and mood. Her paleness, apparent tiredness and depression were observed and commented upon by lay persons as well as by three doctors. Accordingly, Heydon JA was not wrong to regard these matters as relevant and confirmatory. The fourth matter was the respondent's inability to recollect and concentrate. I would accept that there must be a large element of subjectivity about this matter but the fact is that one doctor, Robertson, formed an impression of at least some minor impairment of the respondent's memory. That does provide some slight support for the respondent's assertions. If that matter stood alone, it would not justify intervention by the Court of Appeal. I am also in some doubt as to the objective quality of the next matter upon which Heydon JA relied, an impression of sincerity on the part of the respondent formed by a number of doctors. That matter I would place in the same category as the one that I have just discussed. The sixth matter however, is of some real relevance, and that is the fact that one doctor prescribed a course of antibiotics for the improvement of the appellant's condition, and she took the antibiotics as well as generally acted on such advice as the other medical advisers gave her from time to time. Heydon JA pointed out that there could be no question that the respondent did contract acute Q fever. There was good statistical and experiential evidence that about 10-20% of sufferers from Q fever, particularly acute Q fever, do go on to develop chronic fatigue syndrome which can last for years. Professor Lloyd thought the respondent's case, one of "a typical post infective fatigue syndrome following serologically documented Q fever". This last matter is a significant one. Taken with the other matters, the typical nature of the complaint does Callinan amount to a real matter of substance to which the trial judge ought at least have given some consideration. A complete reading of the reasons for judgment of Heydon JA indicates that in addition to the several matters to which his Honour referred, he was left with an unmistakable impression that the respondent's case had not been given the consideration that it should have been: that in effect the respondent had been denied a full and balanced appraisal of all of the evidence in the case, and that had it been properly appraised, apparent discrepancies which Heydon JA thought minor ones only, would have been better understood and readily explicable. Not enough attention was given, Heydon JA thought, for example, to the unlikelihood that the respondent had resolved "to live a complete lie and maintain a consistent but wholly or largely mendacious story to be told to her family, her friends, her doctors, her lawyers and ultimately the court over a period of six years." Before stating my opinion there is one further matter to which the respondent drew attention which I should mention. It is that some of the medical opinion advanced by the appellant at the trial was not fully informed by the fact that the respondent had suffered a recurrence of severe acute febrile illness at about the time that the appellant's doctors were saying that other events explained the respondent's subsequent condition of fatigue and general debilitation. In my opinion, this appeal should be dismissed. It is unnecessary for me, in so holding, to decide whether the Court of Appeal was right to uphold the appeal under Pt 51 r 23(1) of the Supreme Court Rules made under s 124 of the Supreme Court Act 1970 (NSW) or whether the Rule was regularly and validly made under it, as, in my view, the errors at first instance required appellate intervention pursuant to s 75A of that Act91. 91 "75A Appeal Subject to subsections (2) and (3), this section applies to an appeal to the Court and to an appeal in proceedings in the Court. This section does not apply to so much of an appeal as relates to a claim in the appeal: for a new trial on a cause of action for debt, damages or other money or for possession of land, or for detention of goods, or for the setting aside of a verdict, finding, assessment or judgment on a cause of action of any of those kinds, being an appeal arising out of: a trial with a jury in the Court, or (Footnote continues on next page) Callinan As to the operation of that section, I adhere to what I said in Fox v Percy92, and in particular to this93: a trial: in the District Court. with or without a jury in an action commenced before the commencement of section 4 of the District Court (Amendment) Act 1975, or with a commencement of that section, jury in an action commenced after the This section does not apply to an appeal to the Court under the Justices Act 1902 or to proceedings in the Court on a stated case. This section has effect subject to any Act. (5) Where the decision or other matter under appeal has been given after a hearing, the appeal shall be by way of rehearing. The Court shall have the powers and duties of the court, body or other person from whom the appeal is brought, including powers and duties concerning: amendment, the drawing of inferences and the making of findings of fact, and the assessment of damages and other money sums. The Court may receive further evidence. Notwithstanding subsection (7), where the appeal is from a judgment after a trial or hearing on the merits, the Court shall not receive further evidence except on special grounds. Subsection (8) does not apply to evidence concerning matters occurring after the trial or hearing. (10) The Court may make any finding or assessment, give any judgment, make any order or give any direction which ought to have been given or made or which the nature of the case requires." 92 (2003) 77 ALJR 989; 197 ALR 201. Callinan "To impose the test stated in Devries is, I think, to do what was said to be impermissible as long ago as 192094, to elevate as a practical matter, the decision of a judge sitting alone to the level of a verdict of a jury. This is so even though judges are bound to give reasons95 and those reasons are required to be able to withstand scrutiny. The value of that scrutiny will be much reduced if a statement in the reasons that the demeanour of a witness has been determinative of the first instance decision, is effectively taken to be conclusive of the outcome of an appeal by way of rehearing. The vast majority of the cases tried in this country are tried by judges sitting alone and depend upon their facts rather than upon the application of complex legal principles. To impose an unduly high barrier, and not one sanctioned by the enactment conferring the right of appeal would be to deny recourse by litigants to what the Parliament of the State has said they should have. Judges are fallible on issues of fact as well as of law; sometimes they are obliged to work under a great deal of pressure, and sometimes they are denied a timely transcript. In the days when rights of appeal were first enacted, notes and transcripts were much less complete and reliable than they now are. And today courts of first instance, in some jurisdictions at least, rely heavily on written statements, certainly of the evidence in chief, the oral adducing of which might on occasions have been as, or even more revealing than, evidence adduced from an honest but inarticulate or nervous witness in cross-examination. Occasional errors of fact are bound to be made. No litigant should be expected to accept with equanimity that his or her right of appeal to an intermediate court is of much less utility because it goes to a factual error that can be explained away by a judge-made rule, than an appeal on a question of law: or that although the trial judge was wrong on the facts, there was no incontrovertible fact against which the judge's error could be measured." It is true that in many respects, Earthline upon which the respondent relied, was a special case because there was documentary evidence on affidavit which went completely unchallenged, and which, inexplicably the trial judge rejected. But what their Honours (Gaudron, Gummow and Hayne JJ) said in and of that case, is of relevance and may be applied here96: 93 Fox v Percy (2003) 77 ALJR 989 at 1016 [148]; 197 ALR 201 at 238. 94 London Bank of Australia Ltd v Kendall (1920) 28 CLR 401. 95 Pettitt v Dunkley [1971] 1 NSWLR 376. 96 State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In liq) (1999) 73 ALJR 306 at 321 [63]; 160 ALR 588 at 607. Callinan "It is true that the trial judge, in determining whether to accept the evidence of Mrs Page, was heavily swayed by his impression of her whilst giving oral evidence. However, this circumstance does not preclude a court of appeal from concluding that, in light of other evidence, a primary judge had too fragile a base to support a finding that a witness was unreliable97." Furthermore, as the judgment of Kirby J98 explains, there are numerous cases in which, despite a strong impression which a trial judge may have formed, circumstances justifying interference by an appellate court may exist. I did not take his Honour to be saying in that case that the categories of cases for appellate intervention with respect to factual matters were closed. Nor do I think that the observations that I made in that case are irrelevant to this one, that a failure to give the significance to particular evidence that it plainly deserves may, of itself, particularly when other indications of error, even only minor ones are present, will also warrant intervention by an appellate court99. Nothing that I have said should be taken to mean that deference, indeed a great deal of it, should not be accorded to findings of fact at first instance, particularly those based upon demeanour and impression. Nor should it be taken to mean that plaintiffs are not obliged to discharge the onus of proof of their damages. There will be very few cases in which the complaints and disabilities are not provable objectively, and in which the plaintiff has not by his or her own evidence persuaded the court of their existence, that an appellate court will be entitled to intervene. This case is however one such case. The reasons why in summary I would dismiss this appeal are that, first, there were some quite significant objective pieces of evidence identified by Heydon JA in the Court of Appeal which should have been, but were not considered and weighed by the primary judge. Secondly, the Court of Appeal did not err in holding, as in effect it did, that the strongly adverse finding of the primary judge, that the respondent's evidence was unacceptable, had too fragile a basis to support it, particularly in 97 Apand Pty Ltd v Kettle Chip Co Pty Ltd (1994) 52 FCR 474 at 496-497. See also Voulis v Kozary (1975) 180 CLR 177; Chambers v Jobling (1986) 7 NSWLR 1. 98 State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In liq) (1999) 73 ALJR 306 at 331-332 [93]; 160 ALR 588 at 620-622. 99 State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In liq) (1999) 73 ALJR 306 at 338-344 [139]-[154]; 160 ALR 588 at 630-636. Callinan the absence of a complete and careful examination of all of the evidence. Such an examination would have revealed, among other things the serious question concerning the aetiology of the respondent's illness to which the subsequent recurrence of a severe acute febrile illness was highly relevant. A further reason why the appeal should be dismissed is that, in my opinion the Court of Appeal properly carried out its function and duty, without discernible error, that s 75A of the Supreme Court Act requires it to perform. An appellate court in a civil case is not bound in terms to review the evidence at first instance to see whether the result there is "unsafe or unsatisfactory" as it is sometimes obliged to do in a criminal appeal. But there may be cases, and this the Court of Appeal not erroneously took to be one, in which it is apparent that the whole of the evidence, and the relationships between the respective parts of it have not been adequately considered and analysed at first instance, with the result that the outcome of the trial is unsatisfactory, and requires that, pursuant to s 75A of the Supreme Court Act an appellate court intervene. I would dismiss the appeal with costs. I would however make one further order with respect to costs and that is, whether the respondent succeed or not on the retrial which has been ordered by the Court of Appeal, the respondent should not have her costs of the first trial. Each party, by joining in conducting the trial in the way in which each did, contributed to its unsatisfactory outcome.
HIGH COURT OF AUSTRALIA APPELLANT AND DIRECTOR OF PUBLIC PROSECUTIONS (NSW) RESPONDENT Mok v Director of Public Prosecutions (NSW) [2016] HCA 13 6 April 2016 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation G R James QC with P D Lange for the appellant (instructed by Murphy's Lawyers) N J Adams SC with B K Baker for the respondent (instructed by Solicitor for Public Prosections (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Mok v Director of Public Prosecutions (NSW) Federal jurisdiction – Application of State laws – Service and Execution of Process Act 1992 (Cth) ("SEPA"), s 89(4) – Where appellant arrested in Victoria pursuant to warrant issued in New South Wales – Where order made under s 83(8)(b) of SEPA to return appellant in custody to New South Wales – Where appellant charged with attempting to escape lawful custody under s 310D of Crimes Act 1900 (NSW) ("Crimes Act") – Whether s 89(4) of SEPA applied s 310D of Crimes Act as surrogate federal law – Whether content of applied State law altered – Whether prosecution required to prove all elements of offence under State law. Words and phrases – "competent authority", "correctional centre", "court", "escape lawful custody", "inmate", "law of a State", "surrogate federal law". Constitution, ss 51(xxiv), 52(i). Commonwealth Places (Application of Laws) Act 1970 (Cth), s 4. Judiciary Act 1903 (Cth), ss 68, 79. Service and Execution of Process Act 1992 (Cth), ss 8(4), 81A, 82, 83, 89. Children (Detention Centres) Act 1987 (NSW), s 33(1). Crimes Act 1900 (NSW), Pt 1A, ss 310A, 310D. Crimes (Administration of Sentences) Act 1999 (NSW), ss 3(1), 4. Interpretation Act 1987 (NSW), ss 5, 12. FRENCH CJ AND BELL J. Introduction The Service and Execution of Process Act 1992 (Cth) ("SEPA 1992") provides for the execution throughout Australia of warrants authorising the apprehension of persons under State laws1. Under SEPA 1992 a person named in a warrant issued in one State may be apprehended in another State2 and taken before a magistrate in that State. Upon production of the warrant or a copy of it3 the magistrate must make one of two orders under s 83(8) of the Act. The person must be remanded on bail to appear in the issuing State at a specified place and time4 or, as in the present case, an order made under s 83(8)(b): "that the person be taken, in such custody or otherwise as the magistrate specifies, to a specified place in the place of issue of the warrant." In the latter event, the person must be returned in custody to the State in which the warrant was issued. The appellant attempted to escape from lawful custody at Tullamarine Airport while being taken from Victoria to New South Wales pursuant to an order made under s 83(8)(b). As appears from a Court Attendance Notice later issued to him in New South Wales, he was charged under s 310D of the Crimes Act 1900 (NSW) that being an "inmate" he attempted to escape lawful custody5. Section 310D was said to apply to his escape in Victoria by operation of s 89(4) of SEPA 1992. Section 89(4) provides: 1 SEPA 1992, s 3(1), definition of "warrant". Section 5(1) regards each Territory (except external Territories that are taken to be part of a State or another Territory by operation of s 7(2)) as a State for the purpose of SEPA 1992. Accordingly, in these reasons "State" should also be taken to refer to each Territory in the context of SEPA 1992. 2 SEPA 1992, s 82(1). A provision which does not apply to a person who is imprisoned: s 82(2). 3 SEPA 1992, s 83(1) and (2). 4 SEPA 1992, s 83(8)(a). 5 By s 310A of the Crimes Act the term "inmate" is defined to have the same meaning as it has in the Crimes (Administration of Sentences) Act 1999 (NSW). The relevant part of the definition appears at [22] of these reasons. Bell "The law in force in the place of issue of a warrant, being the law relating to the liability of a person who escapes from lawful custody, applies to a person being taken to the place of issue in compliance with an order mentioned in subsection (1)." The formulation of the charge set out in the Court Attendance Notice6 was faulty to the extent that it conveyed the impression that it relied upon a direct application of s 310D without reference to s 89(4) of SEPA 1992. However, the magistrate recognised that s 310D was applied by virtue of s 89(4) of SEPA 1992. He dismissed the charge on the basis that as a matter of law the prosecution had not established a necessary element of the offence under s 310D, namely the requirement that the appellant be an "inmate"7. An appeal against the magistrate's decision was allowed by Rothman J in the Supreme Court of New South Wales8 and an appeal against his Honour's decision dismissed by the Court of Appeal of New South Wales9. Both Rothman J and the Court of Appeal held that s 89(4) creates a federal offence by picking up the content of the relevant State law relating to escaping lawful custody. The appeal to this Court, by special leave10, concerns the way in which s 89(4) does that. The particular question in this appeal is whether for a conviction of that federal offence it was necessary to show that the appellant was an "inmate" for the purposes of s 310D of the Crimes Act. Rothman J held that it was and that the appellant was an inmate11. The Court of Appeal held that that element of the offence under s 310D was not picked up by s 89(4)12. 6 Criminal Procedure Act 1986 (NSW), s 47(1); see also s 50 regarding the required form of the Court Attendance Notice and description of the offence. 7 Police v Mok unreported, Local Court of New South Wales, 1 July 2013 at 14 [52] per Magistrate Buscombe. 8 Director of Public Prosecutions (NSW) v Mok (2014) 296 FLR 1. 9 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584. 10 [2015] HCATrans 301 (Bell and Gageler JJ). 11 (2014) 296 FLR 1 at 11 [40], 12–14 [48]–[58]. 12 (2015) 320 ALR 584 at 587 [9], 589 [20], 595 [49]–[51]. Bell Factual history The factual history leading to this appeal stretches back over 10 years. In February 2003, the appellant was arrested and charged in New South Wales with fraud offences to which he pleaded guilty in the Local Court on 11 March 2004. He was committed to the District Court of New South Wales for sentence. Pursuant to that committal order he was ultimately required to appear before the District Court on 13 April 2006. The reasons for the delays between his charge and his guilty plea, and between the committal order and the sentencing date, do not appear from the record. The appellant did not appear as required at the District Court on 13 April 2006. On 18 April 2006, Freeman DCJ issued a Bench Warrant to apprehend him. It took the form of a command to the Commissioner of Police for the State of New South Wales and to all police officers in that State: "to apprehend the said Offender and to bring him before me or some other Judge of the said Court or some Justice or Justices of the Peace, in and for the said State to be dealt with according to law." The appellant next surfaced in Victoria when he was arrested on 14 December 2011 in Dandenong, and charged with two Commonwealth offences relating to the possession of a false Australian passport and money laundering. He was granted conditional bail. Another delay, unexplained in the record, ensued until 26 February 2013 when he appeared in the Melbourne Magistrates' Court on those charges. As he left the Court he was arrested by an officer of the Victorian Police pursuant to the warrant which had been issued in New South Wales by Freeman DCJ and which was given effect in Victoria by operation of s 82 of SEPA 1992. The following day, on 27 February 2013 in the Melbourne Magistrates' Court, a magistrate issued a warrant headed "SERVICE AND EXECUTION OF PROCESS ACT 1992 WARRANT TO REMAND A PERSON TO ANOTHER STATE". The warrant commanded a named New South Wales police officer to take the appellant and safely convey him to the Sydney Police Centre in the State of New South Wales and take him before a magistrate for that State to answer the charges and be further dealt with according to law. That order, under s 83(8)(b) of SEPA 1992, was administrative in character13. Its validity was not in dispute14. 13 As with the like orders made under the Service and Execution of Process Act 1901 (Cth). See Aston v Irvine (1955) 92 CLR 353 at 365; [1955] HCA 53; Ammann v Wegener (1972) 129 CLR 415; [1972] HCA 58 which left open the question (Footnote continues on next page) Bell On 28 February 2013, the officer named in the Victorian warrant, and another New South Wales police officer, collected the appellant from the Melbourne Magistrates' Court and escorted him to Tullamarine Airport. At the airport, in the vicinity of the boarding gate for the flight to Sydney, the appellant tried to escape by running away from the officers. He ran about 100 metres before he was re-arrested. On his return to New South Wales he was charged under s 310D of the Crimes Act. Statutory framework — SEPA 1992 SEPA 1992, like its predecessor, the Service and Execution of Process Act 1901 (Cth) ("SEPA 1901"), was enacted pursuant to s 51(xxiv) of the Constitution, which authorises the making of laws for: "the service and execution throughout the Commonwealth of the civil and criminal process and the judgments of the courts of the States". The necessity for such a power was recognised well before federation because of the difficulties which had been experienced in the extradition of offenders between the Australian colonies. Those difficulties had led to reliance upon Imperial statutes relating to extradition15 and later laws made pursuant to the Federal Council of Australasia Act 1885 (Imp)16. The purpose of the power whether, although acting administratively, the magistrate was sitting as a court: at 436 per Gibbs J, Walsh J agreeing at 430, Stephen J agreeing at 439. 14 Unlike s 18 of the Service and Execution of Process Act 1901 (Cth), s 83 of SEPA 1992 imposes a duty on the magistrate to make one of the orders specified in s 83(8). The Court of Appeal held that its mandatory nature tended to confirm its administrative character: (2015) 320 ALR 584 at 590 [25]. Whether the imposition of that duty was valid in light of the question discussed and left open in O'Donoghue v Ireland (2008) 234 CLR 599 at 623–626 [48]–[57]; [2008] HCA 14 was not raised at any stage of the proceedings leading to this appeal. 15 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 617–620; and see Ammann v Wegener (1972) 129 CLR 415 at 443 per Mason J; Dalton v New South Wales Crime Commission (2006) 227 CLR 490 at 500–502 [21]–[25]; [2006] HCA 17. 16 Which by s 15(f) conferred on the Federal Council legislative authority in respect of "[t]he enforcement of criminal process beyond the limits of the colony in which it is issued, and the extradition of offenders" and led to the enactment of the Australasian Civil Process Act 1886 (49 Vict No 3), the Australasian Judgments Act 1886 (49 Vict No 4) and the Australasian Testamentary Process Act 1897 (60 (Footnote continues on next page) Bell conferred by s 51(xxiv), given effect in SEPA 1901 and SEPA 1992, as stated by this Court in Aston v Irvine17, is: "securing the enforcement of the civil and criminal process of each State in every other State." It was described as18: "a power to be exercised in aid of the functions of the States and [it] does not relate to what otherwise is a function of the Commonwealth." Early in the life of SEPA 1901, an argument was put to this Court in McGlew v New South Wales Malting Co Ltd19 that "the intention" of s 51(xxiv) was to enable the Parliament to enact a law which would merely "extend the arm of the State Courts so as to enable parties to be brought before them."20 The Court took a broader view of Parliament's power to legislate with respect to service and execution of process throughout the Commonwealth, extending, for instance, to such incidental powers as enabling courts to protect against abuse of interstate process21. Following a report of the Law Reform Commission ("the Commission") on service and execution of process ("the Report")22, SEPA 1901 was amended23 and then replaced completely by SEPA 1992. An important difference between SEPA 1992 and SEPA 1901 is that SEPA 1992 provides for the exclusion of State laws which might otherwise operate concurrently with it. SEPA 1901 made Vict No 2), preserved by covering cl 7 of the Constitution, which repealed the 1885 Act. The statutes were all repealed by s 2 of SEPA 1901. 17 (1955) 92 CLR 353 at 364. 18 (1955) 92 CLR 353 at 364; Flaherty v Girgis (1987) 162 CLR 574 at 593 per Mason ACJ, Wilson and Dawson JJ; [1987] HCA 17. 19 (1918) 25 CLR 416; [1918] HCA 72. 20 An argument advanced by Knox KC in submissions: (1918) 25 CLR 416 at 418. 21 (1918) 25 CLR 416 at 420–421. 22 Law Reform Commission, Service and Execution of Process, Report No 40, 23 Service and Execution of Process Amendment Act 1991 (Cth). Bell no express provision for any such exclusion and, at least in its application to civil process, was held to be not exhaustive24. The Commission recommended that the new SEPA "express an intention to cover the field, that is, to provide the only law on the subject of service and execution of State and Territory process and judgments outside the State or Territory of issue or rendition and within Australia."25 So it is that SEPA 1992 makes express provision for the exclusion of State laws in s 826. Relevantly, s 8(4) provides: "Subject to this Act, this Act applies to the exclusion of a law of a State (the relevant State) with respect to: the service or execution in another State of process of the relevant State that is process to which this Act applies". The subsection operates as an express exclusion by a Commonwealth law of the application of State law on a particular subject matter. It thereby renders any invalidated by such State Commonwealth law but by operation of s 109 of the Constitution27. There was no suggestion that s 8(4) did not have that effect in relation to the class of laws it described and the Court of Appeal so held in its judgment28. inoperative not because is directly law 24 Renton v Renton (1918) 25 CLR 291 at 298 per Barton J; [1918] HCA 57; Flaherty v Girgis (1987) 162 CLR 574 at 588–598 per Mason ACJ, Wilson and Dawson JJ, 607 per Brennan J, 610 per Deane J. 25 Law Reform Commission, Service and Execution of Process, Report No 40, (1987) 26 By s 8(3A) the exclusionary operation of s 8(4), and SEPA 1992 generally, does not affect the operation of the "cross-border laws", which are the cross-border laws of a participating jurisdiction within the meaning of s 8 of the Cross-border Justice Act 2008 (WA). Under that scheme, the participating jurisdictions of Western Australia, South Australia and the Northern Territory authorised the extension of each other's laws in cross-border regions with which an alleged offender has a connection: see Cross-border Justice Act 2008 (WA), Cross-border Justice Act 2009 (SA), Cross-border Justice Act (NT). 27 Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373 at 466 per Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ; [1995] HCA 47. 28 (2015) 320 ALR 584 at 592 [35]. Bell The term "law of a State" in s 8 is to be understood by reference to s 3(5) of SEPA 1992 which provides: "A reference in this Act to a law of the Commonwealth or a State is a reference to a law (whether written or unwritten) of or in force in the Commonwealth or the State, as the case may be." The "unwritten law" of a State encompassed by that definition must be understood as a reference to "the principles of law and equity expounded from time to time in decisions respecting the common law of Australia."29 That aspect of the definition of a "law of a State" encompasses the phrase "law in force in the place of issue of a warrant" in s 89(4). It allows for the application of s 89(4) to the common law offence of escaping lawful custody which, as appears below, continues in effect in New South Wales. The appellant in written submissions to this Court argued that s 89(4) does not create an offence against Commonwealth law but operates as "merely an exception to the general exclusion, which is otherwise provided by s 8(4)(a) SEPA."30 That argument was evidently not advanced in the Court of Appeal, which observed that31: "It was common ground that s 89(4) applied when [the appellant] was at Tullamarine Airport on 28 February 2013." The argument is untenable. It assumes an extra-territorial operation for all State laws the subject of the propounded carve out from s 89(4). It cannot be supported by the text of s 89(4). In any event, counsel for the appellant presented his oral argument on the basis that s 89(4) creates a liability at federal law which derives its content from the unaltered text of the applicable State law. Section 89(4) has been set out in the Introduction to these reasons. Similar provision is made in s 46(4) and s 74(4) of SEPA 1992 in relation to escapes by prisoners being taken in custody from one State to another pursuant to 29 Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd (2003) 214 CLR 51 at 71 [38] per Gummow and Hayne JJ; [2003] HCA 18. 30 Although the appellant did contend in his written submissions that any offence he had committed by attempting to escape at Tullamarine Airport was an offence against a law of the Commonwealth by operation of the Commonwealth Places (Application of Laws) Act 1970 (Cth). 31 (2015) 320 ALR 584 at 591 [28]. Bell a subpoena issued by a court or tribunal, respectively, in the latter State32. Section 94C makes similar provision with respect to prisoners being taken from one part of an issuing State to another through a "transit State". SEPA 1901 contained no equivalents until 1991 when a precursor provision, s 19ZC(2), was inserted33. The Commission adverted to the lack of an "escape" provision in SEPA 1901. For prisoners in transit under a production order it recommended that proceedings, if any, in relation to an escape should be dealt with in the place in which the person was under lawful restraint and proposed34: "Therefore an escape while in transit or in attendance in compliance with an order should be dealt with as if the escape occurred in the State or Territory in which the person is under lawful restraint." That recommendation was reflected in a new s 19W(5) inserted in 199135 and carried over into s 46(4) and s 74(4) of SEPA 1992. The Commission took a different approach to the law to be applied to persons in custody under an order giving effect to a warrant of apprehension. The Commission said36: "This situation has been discussed in the context of the production of persons under lawful restraint for the purpose of giving evidence in proceedings in other States or Territories and the recommendations there made should apply generally here also. However, rather than proceedings 32 Those provisions do not apply to an escape from lawful custody in respect of an offence against a law of the Commonwealth: SEPA 1992, ss 89(5), 74(5) and 33 Although the original provisions relating to warrants of apprehension and transfer of persons in SEPA 1901 were modelled in part on the Indictable Offences Act 1848 (11 & 12 Vict c 42) and the Fugitive Offenders Act 1881 (Imp), there was no equivalent of s 28 of the 1881 Act, which provided for the trial of a person who escaped from custody under an inter-jurisdictional warrant. Section 19ZC(2), in similar terms to s 89(4), was inserted into SEPA 1901 by the Service and Execution of Process Amendment Act 1991 (Cth). 34 Law Reform Commission, Service and Execution of Process, Report No 40, (1987) 35 Service and Execution of Process Amendment Act 1991 (Cth). 36 Law Reform Commission, Service and Execution of Process, Report No 40, (1987) Bell in relation to an escape being taken in the State or Territory from which the person has come, in this context such proceedings should be taken in the State or Territory to which the person was being taken, that is, the State or Territory of issue of the apprehension process." (footnote omitted) Clause 70(2) of the draft Bill annexed to the Report of the Commission gave effect to its recommendation in language prefiguring that of s 89(4), the "The provisions of a law in force in the place of issue of a warrant that relate to the liability of a person who escapes from lawful custody apply to a person being taken to the place of issue in compliance with an order referred to in subsection (1)." The Commission did not discuss the character of the law as applied pursuant to its proposal. Statutory framework — Commonwealth Places (Application of Laws) Act 1970 (Cth) Reference was made the Commonwealth Places (Application of Laws) Act 1970 (Cth) ("the CPAL Act"). The relevant provisions of s 4 of that Act provide: in argument "(1) The provisions of the laws of a State as in force at a time (whether before or after the commencement of this Act) apply, or shall be deemed to have applied, in accordance with their tenor, at that time in and in relation to each place in that State that is or was a Commonwealth place at that time. This section does not: extend to the provisions of a law of a State to the extent that, if that law applied, or had applied, in or in relation to a Commonwealth place, it would be, or have been, invalid or inoperative in its application in or in relation to that Commonwealth place otherwise than by reason of the 37 Law Reform Commission, Service and Execution of Process, Report No 40, (1987) Bell operation of section 52 of the Constitution in relation to Commonwealth places". The preceding provisions are in terms directed to the laws of a State in force within that State. The application of those provisions is extended to the laws of a State having extra-territorial operation in another State by s 4(4), which provides: "In so far as a law of a State has effect in another State, subsection (1) of this section operates to make the provisions of that law applicable in or in relation to a Commonwealth place in that other State." Section 4(4) of the CPAL Act has potential application in this case because of the arguable extra-territorial application of s 310D. Part 1A of the Crimes Act, entitled "Geographical jurisdiction", extends the application of a law of New South Wales that creates an offence beyond the territorial limits of the State if there is the nexus required by that Part between New South Wales and the offence38. A requisite geographical nexus exists between the State and offences committed wholly outside the State if "the offence has an effect in the State."39 Absent s 8(4) of SEPA 1992, s 310D would arguably have had a direct operation in States other than New South Wales by virtue of Pt 1A. However, as the Court of Appeal observed, Tullamarine Airport (where the attempted escape took place) was a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Constitution and therefore s 310D could not apply of its own force in that place even if it would otherwise have had extra- territorial application40. The appellant submitted that if he had committed an offence it would have been a Commonwealth offence owing its existence to the CPAL Act. That Act, he submitted, applied the applicable State law without rewriting it. That is to say, if s 310D were applied by the CPAL Act at Tullamarine Airport he would have to have been an "inmate" within the meaning of s 310D in order to offend 38 Crimes Act, s 10A. Part 1A was inserted into the Act by the Crimes Legislation Amendment Act 2000 (NSW). 39 Crimes Act, s 10C(2)(b). 40 (2015) 320 ALR 584 at 589 [21], citing Worthing v Rowell and Muston Pty Ltd (1970) 123 CLR 89; [1970] HCA 19; R v Phillips (1970) 125 CLR 93; [1970] HCA 50; Allders International Pty Ltd v Commissioner of State Revenue (Vict) (1996) 186 CLR 630; [1996] HCA 58; Permanent Trustee Australia Ltd v Commissioner of State Revenue (Vict) (2004) 220 CLR 388; [2004] HCA 53. Bell against it. His submission that the CPAL Act applies State laws unchanged relied upon the observation of Gleeson CJ and Gaudron J in The Commonwealth v Western Australia (Mining Act Case)41 that "[s]ection 4(1) operates to apply State laws 'in accordance with their tenor', not to rewrite them." He also relied upon the judgment of Spigelman CJ (with whom Barr and Hoeben JJ agreed) in R v Porter42 applying that dictum. In this case, however, the CPAL Act is not the only relevant Commonwealth law. By virtue of s 4(2)(a) it cannot apply a State law which, apart from s 52 of the Constitution, would be rendered inoperative, in its direct application, by s 8(4) of SEPA 1992. That provision applies to a law of New South Wales with respect to "the service or execution in another State of process of [New South Wales] that is process to which this Act applies". Section 310D in its extra-territorial operation would answer that description, as the Court of Appeal held43. Section 310D, however, has no relevant valid extra- territorial operation anywhere in Victoria because any such operation is displaced by s 8(4). It is therefore the construction of s 89(4), applying s 310D, that is in issue in this appeal. The law of New South Wales — escaping from lawful custody The law which was found, in the Supreme Court and the Court of Appeal of New South Wales, to "apply" to the appellant in this case, by operation of s 89(4) of SEPA 1992, was s 310D of the Crimes Act, which provides: "Any inmate: (a) who escapes or attempts to escape from lawful custody, or (b) who, having been temporarily released from lawful custody, fails to return to lawful custody at the end of the time for which the inmate has been released, is guilty of an offence. Maximum penalty: imprisonment for 10 years."44 41 (1999) 196 CLR 392 at 415 [51]; [1999] HCA 5. 42 (2004) 61 NSWLR 384 at 388 [12]. 43 (2015) 320 ALR 584 at 592 [35]. 44 The other States and Territories have also enacted statutes providing for the offence of escaping from lawful custody: Crimes Act 1958 (Vic), s 479C; Criminal Law Consolidation Act 1935 (SA), s 254; Criminal Code (Q), s 142; Criminal Code (Footnote continues on next page) Bell Section 310D and associated provisions of the Crimes Act were enacted in 199945. It reproduced the substance of s 34(1) of the Correctional Centres Act 1952 (NSW), which was repealed by the same legislation that enacted s 310D46. The term "inmate" used in s 310D has the same meaning as it has in the Crimes (Administration of Sentences) Act 1999 (NSW)47. In s 3(1) of that Act an inmate is defined as "a person to whom Part 2 applies." Section 4(1) sets out a large range of persons to whom Pt 2 applies, defined essentially by the processes which have led to their imprisonment, detention or custody. It includes in pars (d) and (e): any person the subject of a warrant or order by which a court has committed the person to a correctional centre on remand in connection with proceedings for an offence committed, or alleged to have been committed, by the person, and any person the subject of a warrant or order by which a court or to a other competent authority has committed correctional centre otherwise than as referred to above". the person Section 4(3) repeats that in Pt 2 "inmate" means "a person to whom this Part applies". The term "inmate" used in the predecessor provision, s 34 of the Correctional Centres Act, was similarly defined and included persons ordered to be imprisoned in or committed to a correctional centre by any court, judge or justice or other competent authority48. The term "court", used in pars (d) and (e) of the definition of "inmate", is defined by reference to various named State courts in New South Wales and to (WA), s 146; Criminal Code (Tas), s 107; Criminal Code (NT), s 112; Crimes Act 1900 (ACT), s 160. 45 Crimes Legislation Amendment (Sentencing) Act 1999 (NSW), Sched 3, commenced 3 April 2000. 46 Crimes Legislation Amendment (Sentencing) Act 1999 (NSW), Sched 1, commenced 3 April 2000. 47 Crimes Act, s 310A, definition of "inmate". 48 Correctional Centres Act 1952 (NSW), s 4(1), definition of "inmate". Bell "any other court that, or person who, exercises criminal jurisdiction"49. The term "correctional centre" means, inter alia50: any police station or court cell complex in which an offender is held in custody in accordance with this or any other Act." In addition to s 310D of the Crimes Act, provision is made, by s 33(1) of the Children (Detention Centres) Act 1987 (NSW), for the liability of children escaping from lawful custody. That subsection provides: "A detainee who escapes or attempts to escape from lawful custody is guilty of an offence and liable to imprisonment for a period not exceeding 3 months." In its application, the offence is limited to children. There is a distinction which can be drawn between most if not all of the classes of persons defined as "inmate" for the purposes of s 310D and the class of persons defined as "detainees" for the purposes of the Children (Detention Centres) Act51, which is relevant to the way in which s 89(4) applies s 310D. Most of the persons who are "inmates", for the purposes of s 310D, are relevantly persons who are in custody pursuant to a variety of legal processes including warrants or orders of the kind mentioned in pars (d) and (e) of s 4(1) of the Crimes (Administration of Sentences) Act. Those processes are not in terms limited in their application to a subset of the population. On the other hand, detainees to whom the escape provision of the Children (Detention Centres) Act applies are a subset of the population, namely children, to whom legal processes resulting in their detention have been applied. The application of s 89(4) of SEPA 1992 to a law of that kind would necessarily pick up the defining characteristic of the subset of persons to whom it applied. As explained later in these reasons, it does not pick up, by way of a condition on the criminal liability it imposes, the precise textual description in the law of the issuing State of the process by which a person escaping or attempting to escape lawful custody was taken into that custody. It suffices that the process of the law of the issuing State fits analogically with the process by which a person is taken into custody under s 89 of SEPA 1992 and that the offence created by the law of the issuing State serves the like purpose as that served by s 89(4). 49 Crimes (Administration of Sentences) Act, s 3(1), definition of "court". 50 Crimes (Administration of Sentences) Act, s 3(1), definition of "correctional centre". 51 Children (Detention Centres) Act, s 3(1), definition of "detainee". Bell Reference must also be made to the common law offence of escape from lawful custody. It has been preserved in New South Wales notwithstanding the specific offence created by s 310D. By s 341 of the Crimes Act, which predated s 310D and appears in Div 5 of Pt 7, certain offences at common law were abolished52. A saving provision, s 343, provides: "To remove any doubt, it is declared that the following offences at common law are not abolished by this Division: the offence of escaping from lawful custody"53. The common law offence of escape encompasses escaping from the lawful custody of a member of the police force pursuant to an order of the court54. It may be accepted that in States and Territories in which it exists, the common law offence can be picked up and applied by s 89(4) of SEPA 1992. That does not answer the question — how does s 89(4) apply s 310D? The magistrate's decision The magistrate treated s 310D of the Crimes Act as applicable to the appellant's attempted escape by virtue of s 89(4) of SEPA 1992. He held, however, that on its face the warrant issued in New South Wales by Freeman DCJ on 18 April 2006 did not commit the appellant to a "correctional centre" within the meaning of the Crimes (Administration of Sentences) Act. The appellant was therefore not an "inmate" under that Act and therefore not an "inmate" for the purposes of s 310D. Nor could the order made by the Melbourne Magistrates' Court pursuant to s 83(8)(b) of SEPA 1992 be relied 52 Sections 340–343 were inserted by the Crimes (Public Justice) Amendment Act 1990 (NSW), which entered into force on 25 November 1990. 53 The effect of s 343 as preserving the common law offence was referred to in R v Peehi (1997) 41 NSWLR 476 at 480 per Hidden J, Gleeson CJ and Hunt CJ at CL agreeing at 477. 54 See generally R v Scott [1967] VR 276; R v Dhillon [2006] 1 WLR 1535. Examples of the application of the common law of escape in New South Wales include R v Farlow [1980] 2 NSWLR 166; R v Gregory [1983] 3 NSWLR 172; R v Peehi (1997) 41 NSWLR 476; R v Bethune [2001] NSWCCA 303; R v Gordon [2004] NSWCCA 45; Petterson v The Queen [2013] NSWCCA 133. Bell upon to support that characterisation of the appellant55. The charge against the appellant was accordingly dismissed on a no case submission. The decision of Rothman J The Director of Public Prosecutions (NSW) appealed against the Local Court's decision. The appeal was instituted under s 56 of the Crimes (Appeal and Review) Act 2001 (NSW). Rothman J held that the order made by the Melbourne Magistrates' Court under s 83(8)(b) of SEPA 1992 attracted the application of s 89(4), which in turn applied s 310D of the Crimes Act to the appellant's conduct as an offence under federal law56. The issue on the appeal was whether the appellant had been, at the time of his attempted escape, an "inmate" within the meaning of s 310D and the definition of that term in the Crimes Act57. Rothman J held that both pars (d) and (e) of the definition of "inmate" in the Crimes (Administration of Sentences) Act were applicable because the term "court" used in that definition extended to the Melbourne Magistrates' Court58. He rejected a submission by the appellant that neither par (d) nor par (e) applied because the appellant had not been "committed" to a correctional centre59. His Honour set aside the order of the magistrate dismissing the proceedings and remitted the hearing of the charge to the Local Court to determine any issues associated with irregularity or necessity to amend the charge. The decision of the Court of Appeal The Court of Appeal held that Rothman J was correct to conclude that the appellant must be taken to have been charged with a federal offence, namely a contravention of s 310D of the Crimes Act as made applicable by operation of s 89(4) of SEPA 199260. The Court held that the CPAL Act was inapplicable to 55 Police v Mok unreported, Local Court of New South Wales, 1 July 2013 at 13 [45]– [46], 14 [52] per Magistrate Buscombe. 56 (2014) 296 FLR 1 at 10–11 [39]–[40]. 57 (2014) 296 FLR 1 at 11 [40]. 58 (2014) 296 FLR 1 at 14 [62]–[63]. 59 (2014) 296 FLR 1 at 14–15 [64]–[68]. 60 (2015) 320 ALR 584 at 585 [2]. Bell the case because of s 8(4) of SEPA 1992, read with s 4(2)(a) of the CPAL Act61. Their Honours observed that it was "common ground that s 89(4) applied when [the appellant] was at Tullamarine Airport on 28 February 2013" and that "[t]he parties were correct to proceed on that basis"62. The Court of Appeal identified as a common premise in the submissions made to their Honours that it was a necessary condition of the application of s 310D to the appellant by operation of s 89(4) that the appellant was an "inmate" for the purpose of s 310D at the time of his attempted escape at Tullamarine Airport. That premise was rejected63. The operation of s 89(4) was distinguished from that of ss 68 and 79 of the Judiciary Act 1903 (Cth). Section 89(4) was characterised as taking a limited class of State laws, namely laws of the place of issue of a warrant of apprehension relating to the liability of a person who escapes or attempts to escape from lawful custody. It did not purport to apply that class of laws generally or "according to their tenor" or "in all cases to which they are applicable". Their Honours said64: "Subsection 89(4) does something far more focused. Its premise is that there is a person being taken to the place of issue in compliance with an order made under [SEPA 1992]. That order will at least ordinarily name the person. Subsection 89(4) applies that limited class of laws to that person — the person named in the order." The Court of Appeal approached the construction of s 310D as applied by s 89(4) on a different basis from that adopted by the magistrate and by Rothman J. Their Honours said65: "the effect of s 89(4) applying s 310D to persons being returned to New South Wales was not merely confined to those persons who were being returned in accordance with [SEPA 1992] and who sought to escape who happened to be 'inmates'. Unlike s 79 [of the Judiciary Act], s 89(4) does contain an 'express provision which would enable [the court] to alter the language of a State statute and apply it in that altered form', to paraphrase what Mason J said in John Robertson & Co." 61 (2015) 320 ALR 584 at 591–592 [32]–[36]. 62 (2015) 320 ALR 584 at 591 [28]. 63 (2015) 320 ALR 584 at 589 [20]. 64 (2015) 320 ALR 584 at 594 [47]. 65 (2015) 320 ALR 584 at 595 [49] (emphasis in original). Bell Section 89(4) was treated as applying State law relating to the liability of a person escaping or attempting to escape from lawful custody as surrogate federal law "upon the assumption that escape from lawful custody imposed by an order made by a magistrate in another state is not outside their field."66 The provision left no room for debate about whether or not the appellant was a person who "as an 'inmate'" was within the scope of s 310D in its ordinary operation as an offence under State law. The new federal offence created by s 89(4), acting upon s 310D, applied to all persons being taken to New South Wales in compliance with an order under SEPA 1992 mentioned in s 89(1) and the appellant was such a person67. The conclusion of the Court of Appeal was correct although it need not be supported by the proposition that s 89(4) "alters" the laws which it applies. The Court of Appeal dismissed the appeal with costs. This left in place the remitter order made by Rothman J, there being unresolved issues about whether the Court Attendance Notice could be amended to define the offence charged by reference to s 89(4) of SEPA 1992. The operation of s 89(4) on State laws There is a variety of verbal formulae by which Commonwealth laws give effect to State laws as laws of the Commonwealth. Section 68(1) of the Judiciary Act provides that relevant State laws shall "apply and be applied so far as they are applicable". Section 79(1) of that Act provides that the relevant State laws shall "be binding on all Courts exercising federal jurisdiction in that State ... in all cases to which they are applicable." The CPAL Act provides that the laws of a State may "apply, or shall be deemed to have applied, in accordance with their tenor"68. As this Court observed in Western Australia v The Commonwealth (Native Title Act Case)69, there can be no objection to the Commonwealth Parliament adopting as a law of the Commonwealth a text emanating from a source other than the Parliament: 66 (2015) 320 ALR 584 at 595 [50] (emphasis in original). 67 (2015) 320 ALR 584 at 595 [51]. 68 CPAL Act, s 4(1). See also Commonwealth Places (Mirror Taxes) Act 1998 (Cth), 69 (1995) 183 CLR 373 at 484–485 per Mason CJ, Brennan, Deane, Toohey, Gaudron Bell "In such a case the text becomes, by adoption, a law of the Commonwealth and operates as such." It follows that there is no reason in principle which prevents the Commonwealth from adopting the text of a State law and applying it analogically or modifying it, for example by the addition or removal of conditions attaching to duties, liabilities or powers created by that law70. Whether the State law as picked up is applied analogically or modified depends upon the construction of the relevant Commonwealth law. In the case of s 79 of the Judiciary Act, the State laws which it makes "binding" on courts exercising federal jurisdiction are picked up with their meaning unchanged. They are binding only in cases "to which they are applicable"71. The construction of s 89(4) does not require a binary choice between picking up s 310D unaltered and picking it up altered so as to eliminate the requirement that the person attempting to escape be an "inmate". Analogical application does not strictly involve alteration. It is simply a way of describing how s 89(4) uses the text of the relevant State law. The first constructional question is — what is the content of the class of laws able to be applied by s 89(4) and defined by the term "law in force in the place of issue of a warrant"? The second constructional question is — what does it mean to "apply" a law in that class? Those questions are to be answered by reference to the text, context and purpose of s 89(4). The context and purpose of s 89(4) limit the class of State laws capable of application under s 89(4). It does not include any conceivable law creating an offence of escaping or attempting to escape lawful custody. Before the law of the issuing State can be applied to a person being taken to the place of issue of a warrant of apprehension in compliance with an order made under s 83(8)(b), the law must be capable of application to such a person in those circumstances. That 70 For example, s 4(6) of the CPAL Act authorises regulations providing that a State law applied by s 4 "shall be deemed to have so applied, with such modifications as are specified in the regulations." 71 John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 94–95 per Mason J; [1973] HCA 21; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 593–594 [72]– [74] per Gleeson CJ, Gaudron and Gummow JJ, 609–610 [129]–[130] per McHugh J; [2001] HCA 1; Solomons v District Court (NSW) (2002) 211 CLR 119 at 134 [22] per Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ; [2002] HCA 47; British American Tobacco Australia Ltd v Western Australia (2003) 217 CLR 30 at 60 [67] per McHugh, Gummow and Hayne JJ; [2003] HCA 47. Bell is to say, the circumstances in which the law to be applied operates in the State of issue must be analogical to the circumstances in which it is to be applied by A law creating an offence of escaping or attempting to escape lawful custody while serving a sentence of imprisonment would not answer that description. The words "law in force in the place of issue of a warrant" must be read in the context of the field of their application under s 89(4) and with regard to the purpose of that provision, which is to deter and punish the escape of persons being taken from one place to another under an order made pursuant to s 83(8)(b). A general law prohibiting escape or attempted escape from lawful custody, whatever the process by which that custody arose, would answer the requirements of analogical applicability and purposive fit. An example is the common law offence of escape. It is of general application. Another example appears in the Criminal Codes of States and Territories which have abolished the common law offence72. In Queensland, for example, s 142 of the Code provides: "A person who escapes from lawful custody is guilty of a crime."73 Section 310D, read distributively across the multiple definitions of "inmate", might be seen as creating a number of laws relating to the liability of a person who escapes or attempts to escape from lawful custody. The content of each is defined by the class of "inmate" to which it relates — for the most part by the class of process which has led to the person being in custody. Those processes include sentence of imprisonment74, detention under the Fines Act 1996 (NSW)75, commitment by the Parole Authority to serve the balance of a sentence by way of fulltime detention76, commitment by the Supreme Court of New South Wales to detention pursuant to the Crimes (High Risk Offenders) Act 2006 (NSW)77, commitment to a correctional centre on remand78, commitment to 72 Common law offences generally, except contempt of court, have been abolished by the Criminal Code Act 1899 (Q), s 5; Criminal Code Act Compilation Act 1913 (WA), Appendix B, s 4; Criminal Code Act 1924 (Tas), s 6; Criminal Code Act (NT), s 6; Criminal Code 2002 (ACT), s 5. 73 See also Criminal Code (WA), s 146; Criminal Code (Tas), s 107; Criminal Code (NT), s 112; Crimes Act 1900 (ACT), s 160. 74 Crimes (Administration of Sentences) Act, s 4(1)(a). 75 Crimes (Administration of Sentences) Act, s 4(1)(b). 76 Crimes (Administration of Sentences) Act, s 4(1)(c). 77 Crimes (Administration of Sentences) Act, s 4(1)(c1). Bell the control of the Minister administering the Crimes (Administration of Sentences) Act under the Children (Criminal Proceedings) Act 1987 (NSW)79, commitment to a correctional centre pursuant to punishment of imprisonment under the Defence Force Discipline Act 1982 (Cth)80, detention under the Migration Act 1958 (Cth)81, and commitment to a correctional centre otherwise than as referred to above82. Apart from the processes described in pars (d) and (e), none of those set out in s 4(1) of the Crimes (Administration of Sentences) Act is applicable to a person the subject of an order under s 83(8)(b) or serves the kind of purpose served by s 89(4). The liability attaching to attempted escape from lawful custody under s 310D, derived from orders of the kind contemplated by pars (d) and (e), is plainly applicable by analogy to persons to whom s 89(4) applies. It serves the same purposes. Subject to those constraints, it is right to say, as the Court of Appeal said of s 89(4), that it treats the applicable aspects of s 310D as surrogate federal law "upon the assumption that escape from lawful custody imposed by an order made by a magistrate in another state is not outside their field."83 A requirement that the person attempting to escape answer the description of an "inmate" by reference to close Victorian equivalents of "courts", "competent authorities" and "correctional centres" under New South Wales law would defeat the purpose of the federal law and is not required by the text of s 89(4). Conclusion The Court of Appeal was right to reach the conclusion that it did. The appeal should be dismissed with costs. 78 Crimes (Administration of Sentences) Act, s 4(1)(d). 79 Crimes (Administration of Sentences) Act, s 4(1)(d1). 80 Crimes (Administration of Sentences) Act, s 4(1)(d2). 81 Crimes (Administration of Sentences) Act, s 4(1)(d3). 82 Crimes (Administration of Sentences) Act, s 4(1)(e). 83 (2015) 320 ALR 584 at 595 [50] (emphasis in original). KIEFEL AND KEANE JJ. The factual background and the circumstances which have given rise to the issues in this appeal are summarised in the reasons of French CJ and Bell J. We gratefully adopt that summary and state only the following essential facts. The appellant was in the custody of a New South Wales police officer at Tullamarine Airport, pursuant to a warrant of a magistrate in Victoria, when he escaped. The warrant directed the officer to take the appellant to the Sydney Police Centre in New South Wales to answer charges in relation to fraud offences, in respect of which a warrant for his arrest had issued from the District Court of New South Wales in 2006. Section 89(4) of the Service and Execution of Process Act 1992 (Cth) ("the SEPA 1992") provides: "The law in force in the place of issue of a warrant, being the law relating to the liability of a person who escapes from lawful custody, applies to a person being taken to the place of issue in compliance with an order mentioned in subsection (1)." It is not in dispute that, for the purposes of s 89(4), the appellant was being taken to the place of issue of a warrant, New South Wales, in compliance with an order mentioned in s 89(1) when he escaped from lawful custody. The appellant was apprehended a short while after he escaped. He was subsequently charged with an offence under s 310D of the Crimes Act 1900 (NSW) ("the Crimes Act"), which provides: "Any inmate: (a) who escapes or attempts to escape from lawful custody, or (b) who, having been temporarily released from lawful custody, fails to return to lawful custody at the end of the time for which the inmate has been released, is guilty of an offence." "Inmate" is defined in s 310A of the Crimes Act as having the same meaning that it has in the Crimes (Administration of Sentences) Act 1999 (NSW). That Act provides a number of definitions of "inmate". The parties agree that the only definitions that are relevant are those that refer to a person who has been committed to a "correctional centre". As French CJ and Bell J explain84, the charge erroneously conveyed the impression that the offence arose directly from s 310D of the Crimes Act, rather than that section as it is applied by s 89(4) for the purposes of the SEPA 1992. No point was taken in the courts below about the error in the formulation of the charge, and the matter was dealt with on the basis of the true position (viz, s 310D applied by virtue of s 89(4) of the SEPA 1992). Nevertheless, the magistrate hearing the matter in New South Wales dismissed85 the charge on the basis that the prosecution could not prove that the appellant was an "inmate", as s 310D requires. The Court of Appeal of the Supreme Court of New South Wales held86 that, by virtue of s 89(4) of the SEPA 1992, a person may be guilty of the offence of escape contrary to s 310D of the Crimes Act even if that person is not an "inmate" within the meaning of that Act. For the reasons which follow, the Court of Appeal was correct to so conclude. As the Court of Appeal observed, a State law made applicable by a federal law operates as federal law87. Section 89(4) applied s 310D to the appellant as a federal law, s 310D being the law in force in New South Wales (the place of issue of the warrant) and being the law relating to the liability of a person who escapes from lawful custody. Section 89(4) applied that law to the appellant because he was a person being taken to the place of issue of the warrant in compliance with an order made under s 89(1) of the SEPA 1992. Section 89(4) is, as the Court of Appeal observed88, an example of what Mason J in John Robertson & Co Ltd v Ferguson Transformers Pty Ltd89 said s 79 of the Judiciary Act 1903 (Cth) was not, that is, an "express provision which would enable [the court] to alter the language of a State statute and apply it in that altered form." The Court of Appeal said90: 85 Police v Mok unreported, Local Court of New South Wales, 1 July 2013 at 14-15 [52]-[53] per Magistrate Buscombe. 86 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [51]. 87 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 592 [38]. 88 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [49]. 89 (1973) 129 CLR 65 at 95; [1973] HCA 21. 90 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [51]. "Section 89(4) leaves no room for debate about whether or not Mr Mok is a person who, as an 'inmate', is within the scope of s 310D in its ordinary operation as an offence under state law. The new federal offence created by s 89(4) acting upon s 310D applies to all persons who are being taken to New South Wales in compliance with an order under the [SEPA 1992] mentioned in s 89(1). Mr Mok was such a person." In challenging that conclusion in this Court, the appellant submitted that, even accepting that s 89(4) of the SEPA 1992 is apt to create a new federal offence, s 89(4) applies "[t]he law in force in the place of issue of [the] warrant" without modification or qualification. Accordingly, so it was said, the Court of Appeal erred in holding that s 89(4) of the SEPA 1992 contains an "express provision which would enable [the court] to alter the language of a State statute and apply it in that altered form"91. In this regard, the appellant referred to cases which have held that s 79(1) of the Judiciary Act applies State law in its "unaltered" form92. But s 79(1) provides: "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." The authorities on s 79 are, as the Court of Appeal said93, "of limited assistance" in this case. That is because s 79, in terms, makes the laws of each 91 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [49]. 92 Commissioner of Stamp Duties (NSW) v Owens [No 2] (1953) 88 CLR 168 at 170 per Dixon CJ, Williams, Webb, Fullagar and Kitto JJ; [1953] HCA 62; The Commonwealth v Mewett (1997) 191 CLR 471 at 556 per Gummow and Kirby JJ; [1997] HCA 29; Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136 at 155 [54] per McHugh J; [2000] HCA 39, quoting Maguire v Simpson (1977) 139 CLR 362 at 376 per Gibbs J; [1977] HCA 63; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 611-612 [134]-[135] per McHugh J; [2001] HCA 1; Solomons v District Court (NSW) (2002) 211 CLR 119 at 146 [60] per McHugh J; [2002] HCA 47, quoting Pedersen v Young (1964) 110 CLR 162 at 165 per Kitto J; [1964] HCA 93 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 593 [44]. State or Territory "binding" in all cases to which those laws are applicable in their own terms. Section 89(4) does not apply laws in this way. We agree with French CJ and Bell J that the question as to the application of s 89(4) is to be resolved as a question of construction of that provision. We agree that the words of s 89(4) must be read in the context of their application, to circumstances where a person escapes lawful custody whilst being taken to the place of issue of a warrant in accordance with an order under s 89(1) of the SEPA 1992. It follows that those words are not applicable to a law concerning an escape from a correctional centre. We also agree that the words must be read having regard to their purpose, to deter persons escaping whilst being taken to the place of issue of a warrant in accordance with the SEPA 1992. However, we are of the view that s 89(4) more directly answers the question as to how it is to apply. In our view, the question as to the law which is to be applied should be answered by focusing upon the words in s 89(4), which describe the relevant State or Territory law in force as a "law relating to the liability of a person who escapes from lawful custody". Those words are referable to a law which makes it an offence to escape from lawful custody, without more. As such, they are capable of applying that law to the circumstances in which s 89(4) operates, namely the escape from lawful custody of a person who is being taken to the place of issue of a warrant pursuant to an order to which s 89(1) refers. Section 89(4) does not pick up a State law's reference to persons who may be committed to a correctional centre, or any other "inmate". It would not be appropriate for the circumstances in which s 89(4) operates and it is not necessary. Section 89(4) itself identifies the person to whom it is directed and who may be guilty of the federal offence. Section 89(4) applies to a person who is in the process of being "taken to the place of issue [of the warrant] in compliance with an order mentioned in subsection (1)", who is in lawful custody by virtue of the order, and "who escapes from [that] lawful custody". We agree that the appeal should be dismissed with costs. GORDON J. A New South Wales District Court Judge issued a bench warrant for the apprehension of the appellant. The appellant was arrested in Victoria. Pursuant to s 83(8)(b) of the Service and Execution of Process Act 1992 (Cth) ("the SEP Act"), a Victorian magistrate ordered that the appellant be delivered into the custody of a New South Wales police officer for the purpose of taking him to New South Wales. Whilst the appellant was being taken to New South Wales, he escaped from custody at Tullamarine Airport in Victoria, but was apprehended a short time later. Section 89(4) of the SEP Act provides that "[t]he law in force in the place of issue of a warrant, being the law relating to the liability of a person who escapes from lawful custody, applies to a person being taken to the place of issue in compliance with an order mentioned in subsection (1)". On his return to New South Wales, the appellant was charged with an offence of attempting to escape from lawful custody, contrary to s 310D(a) of the Crimes Act 1900 (NSW) ("the Crimes Act"). By reason of s 89(4) of the SEP Act, could the appellant be guilty of an offence contrary to s 310D of the Crimes Act? The answer is yes. Facts On 11 March 2004, the appellant pleaded guilty to a number of fraud offences contrary to New South Wales law before a magistrate at the Local Court of New South Wales. He was consequently committed to the District Court of New South Wales for sentence. 13 April 2006 was fixed for the purpose of sentencing the appellant. However, on that day, the appellant failed to appear. Freeman DCJ then issued a bench warrant for the apprehension of the appellant ("the NSW Bench Warrant"). The NSW Bench Warrant was directed to "the Commissioner of Police for the State of New South Wales, and to all Police Officers in the said State". The NSW Bench Warrant stated, in part: "AND WHEREAS the said Offender has not appeared at the said District Court on 13/04/2006[.] These are therefore to command you in Her Majesty's name forthwith to apprehend the said Offender and to bring him before me or some other Judge of the said Court or some Justice or Justices of the Peace, in and for the said State to be dealt with according to law." Many years later, on 14 December 2011, the appellant was arrested and charged in Victoria with two unrelated offences. On 26 February 2013, the appellant was sentenced to a term of imprisonment at the Magistrates' Court of Victoria for those offences. On that day, a Victorian police officer executed the NSW Bench Warrant and arrested the appellant pursuant to s 82(1) and (3)(a) of the SEP Act. Those provisions relevantly provide that the person "named in a warrant issued in a State may be apprehended in another State … [by] an officer of the police force of the State in which the person is found". The next day, 27 February 2013, the appellant was brought before a Victorian magistrate pursuant to s 83(1) of the SEP Act. The magistrate ordered that the appellant be delivered into the custody of a New South Wales police officer for the purpose of taking him to New South Wales, in accordance with s 83(8)(b) of the SEP Act ("the SEPA Orders"). The SEPA Orders directed the return of the appellant to New South Wales. Section 83(8)(b) of the SEP Act authorised the magistrate to order "that the person be taken, in such custody or otherwise as the magistrate specifies, to a specified place in the place of issue of the warrant". The SEPA Orders were contained in a document headed "Service and Execution of Process Act 1992 Warrant to remand a person to another State". After setting out details of the NSW Bench Warrant, that document relevantly stated: "I order that the defendant be returned to SYDNEY POLICE CENTRE in the State of NSW in which the warrant was issued, and for that purpose to be delivered into the custody of DET SGT ROBERT MCLENNAN the person bringing the said warrant, or of the Members of the Police Force or persons to whom the warrant was originally directed, or any of them. These are therefore to command you DET SGT ROBERT MCLENNAN the person bringing the said warrant, and all members of the Police Force and persons to whom the warrant was originally directed, or any of you, to forthwith take the defendant and safely convey him to SYDNEY POLICE CENTRE in the State of NSW and take him before a Magistrate for the said State to answer the said charge and to be further dealt with according to law." The next day, 28 February 2013, the officer named in the SEPA Orders and another New South Wales police officer accompanied the appellant to Tullamarine Airport. Whilst being escorted to the aircraft, the appellant escaped from the officers' custody but was apprehended a short time later. The appellant was then transported, without further incident, to Redfern Police Station in New South Wales, where he was charged with an offence of attempting to escape from lawful custody, contrary to s 310D(a) of the Crimes Act ("the Charge"). The appellant did not and does not dispute that the SEPA Orders were validly made under s 83(8)(b) of the SEP Act, that he escaped lawful custody or that, at the time of the escape, he was being returned to New South Wales by New South Wales police officers pursuant to the SEPA Orders. He did not and does not accept that he contravened s 310D(a) of the Crimes Act. Legislative framework Part 5 of the SEP Act deals with "Execution of warrants". As has been seen, the Victorian police officer executed the NSW Bench Warrant and arrested the appellant under s 82, which is in Pt 5 of the SEP Act. Section 82(1) of the SEP Act relevantly provides that the person "named in a warrant issued in a State may be apprehended in another State" (emphasis added). That person may be apprehended by "an officer of the police force of the State in which the person is found"94. For Pt 595, "warrant" is defined in s 81A of the SEP Act to include a "warrant issued by a body or person that is an authority for the purposes" of Pt 5. Also for Pt 5, "authority" is defined in s 81A to include a body or person that, "under a law of a State, may issue a warrant for the arrest and return to custody or detention of a person, following the revocation or cancellation of" certain identified orders96. After a person has been apprehended under s 82 of the SEP Act, the procedure in s 83 is to be adopted. The person must be brought before a magistrate of the State in which the person was apprehended as soon as practicable after being apprehended97. On production of the warrant (here, the NSW Bench Warrant), the magistrate must make an order of the kind provided by s 83(8)(a) or (b)98. Section 83(8)(b) relevantly provides that the order be "that the person be taken, in such custody or otherwise as the magistrate specifies, to a specified place in the place of issue of the warrant" (emphasis added). "[P]lace of issue" is relevantly defined in s 3(1) of the SEP Act to mean "the State in which the process was issued". Next, s 89 of the SEP Act, also in Pt 5, must be addressed. It relevantly provides: 94 s 82(3)(a) of the SEP Act. Section 82 does not apply to a person in prison: s 82(2) of the SEP Act. 95 cf definition of "warrant" in s 3(1) of the SEP Act. 96 cf definition of "authority" in s 3(1) of the SEP Act. 97 s 83(1) of the SEP Act. 98 Subject to ss 83(10) and (14) and 84 of the SEP Act, which are not presently relevant. "(1) For the purpose of complying with an order made under paragraph 83(8)(b), … the person to whom the custody of the apprehended person has been committed may require that the person in charge of a prison in a State: receive the apprehended person and keep the apprehended person in custody for such time as the first-mentioned person requires; and the surrender custody of first-mentioned person at the time and in the way that the first-mentioned person requires. the apprehended person The law in force in the place of issue of a warrant, being the law relating to the liability of a person who escapes from lawful custody, applies to a person being taken to the place of issue in compliance with an order mentioned in subsection (1). Subsection (4) does not apply to lawful custody in respect of an offence against a law of the Commonwealth." (emphasis added) There is no dispute that the NSW Bench Warrant was the relevant "warrant" for the purposes of s 89(4) of the SEP Act and that s 89(4) applied when the appellant was at Tullamarine Airport and escaped from lawful custody. Section 89(5) is not relevant to this appeal because the appellant was in lawful custody in respect of an offence against a law of New South Wales, namely the fraud offences from 2004. The proper construction of s 89(4) of the SEP Act is the central issue in this appeal. Before turning to that question of construction, it is necessary to refer to s 310D(a) of the Crimes Act, the offence with which the appellant was charged at Redfern Police Station upon his return to New South Wales. Section 310D relevantly provides: "Any inmate: (a) who escapes or attempts to escape from lawful custody, or is guilty of an offence." (emphasis added) In that section, "inmate" has the same meaning as it has in the Crimes (Administration of Sentences) Act 1999 (NSW) ("the CAS Act")99. For the purposes of this appeal, it was common ground that "inmate" was relevantly defined in s 4(1)(d) and (e) of the CAS Act: any person the subject of a warrant or order by which a court has committed the person to a correctional centre on remand in connection with proceedings for an offence committed, or alleged to have been committed, by the person, and any person the subject of a warrant or order by which a court or to a other competent authority has committed correctional centre otherwise to above". (emphasis added) than as referred the person "[C]orrectional centre" is defined in s 3(1) of the CAS Act to include "any police station or court cell complex in which an offender is held in custody in accordance with this or any other Act". Previous decisions At the hearing of the Charge before the Local Court, the appellant argued that there was no prima facie case established by the evidence because, relevantly, the appellant was not an "inmate" as that term is used in s 310D of the Crimes Act. The Local Court Magistrate (Buscombe LCM) upheld that submission and dismissed the Charge. The respondent, the New South Wales Director of Public Prosecutions, appealed to the Supreme Court of New South Wales pursuant to s 56(1)(c) of the Crimes (Appeal and Review) Act 2001 (NSW). Rothman J set aside the orders of Buscombe LCM and remitted the hearing of the Charge to be dealt with according to law100. The appellant then sought leave to appeal to the Court of Appeal of the Supreme Court of New South Wales against the decision of Rothman J. The Court of Appeal (Meagher, Hoeben and Leeming JJA) granted the appellant leave to appeal, but dismissed the appeal101. The Court of Appeal concluded that 99 s 310A of the Crimes Act. 100 Director of Public Prosecutions (NSW) v Mok (2014) 296 FLR 1. 101 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584. s 89(4) of the SEP Act (by applying s 310D of the Crimes Act) created a new federal offence which applied to all persons being taken to New South Wales in compliance with an order under the SEP Act mentioned in s 89(1)102. On that construction, it was not relevant whether the appellant was an "inmate" for the purposes of s 310D of the Crimes Act. "Surrogate federal laws" The Commonwealth Parliament, from time to time, passes legislation to "pick up" and apply State laws. Section 4 of the Commonwealth Places (Application of Laws) Act 1970 (Cth) ("the CPAL Act") is an example. Sections 68(1)103 and 79(1)104 of the Judiciary Act 1903 (Cth) ("the Judiciary Act") are two other examples. The form of these provisions is not fixed105. When State laws are applied by such provisions, the State laws made applicable are often called "surrogate federal laws"106. Contentions Although in his written submissions the appellant contended that s 89(4) does not create a new federal offence, the appellant accepted in the course of oral argument in this Court that s 89(4) of the SEP Act creates a federal offence by applying "the law relating to the liability of a person who escapes from lawful custody" in New South Wales. However, the appellant maintained his contention that the prosecution is not relieved of the burden of proving all of the elements of the offence in s 310D of the Crimes Act, including, in particular, the element that the accused be an "inmate". 102 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [51]. 103 Hili v The Queen (2010) 242 CLR 520 at 527 [21]; [2010] HCA 45. 104 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 352 [35]; [1999] HCA 9; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 406 [230]; [2005] HCA 44. 105 See, eg, Insight Vacations Pty Ltd v Young (2011) 243 CLR 149; [2011] HCA 16. See also s 136 of the Excise Act 1901 (Cth) and s 247 of the Customs Act 1901 (Cth), discussed in Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161; [2003] HCA 49. 106 See, eg, Solomons v District Court (NSW) (2002) 211 CLR 119 at 134-135 [20]-[24]; [2002] HCA 47; Insight Vacations Pty Ltd v Young (2011) 243 CLR 149. See also Pedersen v Young (1964) 110 CLR 162 at 165; [1964] HCA 28; [1977] HCA 63; The Commonwealth v Mewett (1997) 191 CLR 471 at 514, 554; [1997] HCA 29. (1977) 139 CLR 362 at 408; The respondent contended that s 89(4) of the SEP Act applied s 310D of the Crimes Act as surrogate federal law, thereby creating a federal offence. The respondent further contended that the elements of that offence under s 310D of the Crimes Act, as applied by s 89(4) of the SEP Act, were established in this appeal, either consistent with the reasoning of the Court of Appeal or because the appellant was an "inmate" for the purposes of s 310D107. There is thus no dispute that s 310D of the Crimes Act is a "law relating to the liability of a person who escapes from lawful custody" as that phrase is used in s 89(4) of the SEP Act. And the parties now accept that s 89(4) of the SEP Act creates a federal offence because s 310D of the Crimes Act applies as surrogate federal law. That offence is properly described as a federal offence108. The issues in dispute are narrow – is it necessary for all the elements of s 310D(a) to be proved for the appellant to be guilty of that offence? If so, was the appellant an inmate for the purposes of s 310D? Before turning to those issues, it is necessary to address how s 310D applies as "surrogate federal law" in this appeal. Tullamarine Airport, a Commonwealth place Tullamarine Airport is a Commonwealth place within the meaning of s 52(i) of the Constitution109. Section 52(i) precludes the laws of Victoria that would ordinarily apply to a geographical area in Victoria (such as Tullamarine Airport) from operating by their own force110. Instead, the laws of the State in which the Commonwealth place is located are applied, as in force at a time, "in accordance with their tenor" at that time, by s 4(1) of the CPAL Act. Section 4(4) of the CPAL Act also makes provision for the application to Commonwealth places of the laws of a State which have extraterritorial effect in another State. In the present appeal, ss 10A to 10C of the Crimes Act extend the operation of s 310D beyond the territorial limits of New South Wales, if there is the required nexus. 107 The second argument was raised by the respondent's amended notice of contention. 108 See Pinkstone v The Queen (2004) 219 CLR 444 at 458 [38]; [2004] HCA 23. 109 Allders International Pty Ltd v Commissioner of State Revenue (Vict) (1996) 186 CLR 630; [1996] HCA 58. 110 Worthing v Rowell and Muston Pty Ltd (1970) 123 CLR 89; [1970] HCA 19; R v Phillips (1970) 125 CLR 93; [1970] HCA 50; Allders International Pty Ltd v Commissioner of State Revenue (Vict) (1996) 186 CLR 630; Permanent Trustee Australia Ltd v Commissioner of State Revenue (Vict) (2004) 220 CLR 388; [2004] HCA 53. However, s 4 of the CPAL Act may be put aside. Section 8(4)(a) of the SEP Act provides that: "Subject to this Act, this Act applies to the exclusion of a law of a State (the relevant State) with respect to: the service or execution in another State of process of the relevant State that is process to which this Act applies". Section 310D of the Crimes Act is a law of New South Wales which may operate beyond the territorial limits of that State111. Section 310D of the Crimes Act is "a law of [New South Wales] with respect to … the ... execution in another State of [the NSW Bench Warrant]" that is caught by s 8(4)(a) of the SEP Act. The SEP Act therefore applies to exclude s 310D of the Crimes Act with respect to the execution of a process, to the extent that s 310D operates beyond the territorial limits of New South Wales112. Section 89(4) of the SEP Act is the provision of the SEP Act which applies. That provision is considered next. Proper construction of s 89(4) of the SEP Act Section 89(4) of the SEP Act provides that: "The law in force in the place of issue of a warrant, being the law relating to the liability of a person who escapes from lawful custody, applies to a person being taken to the place of issue in compliance with an order mentioned in subsection (1)." (emphasis added) Preconditions to s 89(4) Section 89(4) is subject to two relevant preconditions. First, it requires that an order has been made under s 83(8)(b)113. In this appeal, there was such an order114. The SEPA Orders required that the appellant be delivered into the custody of a New South Wales police officer for the purpose of taking him to New South Wales. 111 ss 10A to 10C of the Crimes Act. 112 s 109 of the Constitution and, in relation to Tullamarine Airport, s 4(2)(a) of the CPAL Act. 113 s 89(1) of the SEP Act. 114 See [67]-[68] above. Second, s 89(4) requires that the person is being taken to the place of issue of the warrant, in compliance with the order under s 83(8)(b)115. In this appeal, the appellant was being taken to New South Wales, the place of issue of the NSW Bench Warrant. As the Court of Appeal recognised, "[t]he place of issue [of the warrant] will often (as here) be different from the place where an escape takes place. The place of issue [of the warrant] will always be different from the place" where the order under s 83(8)(b) of the SEP Act that the person be taken into custody is made116. That is why the SEP Act has to be invoked. If these preconditions are met, then s 89(4) in its terms provides that, in relation to that person, the law in force in the place of issue of the warrant (the State law) applies to that person insofar as "the law relat[es] to the liability of a person who escapes from lawful custody". As both preconditions were met in this appeal, s 89(4) applied New South Wales law relating to the liability of a person who escapes from lawful custody to the appellant. A reference in the SEP Act to a law of a State is a reference to both the common law and statute117. Here, the appellant was charged with a contravention of s 310D(a) of the Crimes Act. However, he could have been charged with the common law offence of escaping from lawful custody118. Section 89(4) applies State laws as "surrogate federal law" Section 89(4) puts to rest any doubt about whether the State law (the law in force in the place of issue of the warrant) applies to an escape from lawful custody occurring outside the State, where the order committing the person into the custody from which the escape occurs is an order made under s 83(8)(b) of the SEP Act. In terms, s 89(4) applies the State law as surrogate federal law. Section 89(4) identifies that, in relation to a person in lawful custody under a State law (in the present appeal, in lawful custody under the law of New South Wales), the law in force in the place of issue of the warrant (the State law) applies to that person insofar as "the law relat[es] to the liability of a person who escapes from [that] lawful custody" when that might otherwise be unclear. Section 89(4) of the SEP Act takes a limited class of State laws: laws of the 115 s 81A defines "warrant" for Pt 5 of the SEP Act: see [73] above. 116 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [50] (emphasis in original). 117 s 3(5) of the SEP Act. 118 The common law offence of escaping from lawful custody is preserved by s 343(a) of the Crimes Act. place of issue of the outstanding warrant which relate to the liability of a person who escapes from lawful custody. There is nothing to suggest that the wording of s 89(4) does not operate to apply State laws that meet the description of laws "relating to the liability of a person who escapes from lawful custody" as surrogate federal laws, as long as the preconditions are met. A consequence of the State law being applied as "surrogate federal law" is that a prosecution for an offence against that law will be in federal jurisdiction because there is a matter "arising under" a law of the Commonwealth119, namely s 89(4) of the SEP Act120. If there is a trial on indictment, that trial must comply with s 80 of the Constitution121. Section 89(4) applies State law according to its terms That leaves the question as to whether, when s 89(4) applies State law as surrogate federal law, it does so according to the terms of the State law. Section 89(4) does not purport to apply the relevant State laws "in accordance with their tenor"122, or "in all cases to which they are applicable"123. Section 89(4) is in different terms. It does not contain any qualifying words of that kind. Or as Mason J explained in John Robertson & Co Ltd v Ferguson Transformers Pty Ltd, it "contains no express provision which would enable a court ... to alter the language of a State statute and apply it in that altered form"124. It simply says that the State law "applies" to a person being taken to the place of issue in compliance with an order under s 83(8)(b). And while s 89(4) should apply the relevant State law in a way that is consistent with the purpose of s 89(4)125, that purpose is achieved by applying the State law according to its own terms, as explained below. 119 s 76(ii) of the Constitution. 120 In the criminal context, federal jurisdiction to resolve such matters is conferred on State courts by s 68(2) of the Judiciary Act. 121 Pinkstone v The Queen (2004) 219 CLR 444 at 458 [38]. 122 cf s 4(1) of the CPAL Act. 123 cf s 79(1) of the Judiciary Act. See also s 68(1) of the Judiciary Act. 124 (1973) 129 CLR 65 at 95; [1973] HCA 21. 125 John Robertson (1973) 129 CLR 65 at 95. Purpose, context and history of s 89(4) The construction of s 89(4) of the SEP Act that has been described is consistent with, and reflects, its purpose, context and history126. The purpose of s 89(4) is both legal and practical. First, it fills a gap that might otherwise have been thought to exist in the law127. It removes any doubt about whether a person who escapes from lawful custody while subject to an order under s 83(8)(b) of the SEP Act might be criminally liable, but only if there is a State law which meets the description of a law "relating to the liability of a person who escapes from lawful custody". If there is no such law, then there can be no liability under s 89(4). This approach does not close the potential gap in the law completely, in the way that a specific federal offence could have. Second, it determines which State law is to apply when a person subject to an order under s 83(8)(b) of the SEP Act escapes from lawful custody. It is the State law in force in the place of issue of the warrant that applies to that person. That avoids any confusion about whether, taking the present appeal as an example, it would be more appropriate for the person to be charged under Victorian or New South Wales law. The effect of s 89(4) is to exclude the operation of Victorian law relating to liability for escape from lawful custody. That is not surprising. Section 89(4) is in Pt 5 of the SEP Act, which deals with the execution of warrants under that Act, the purpose of which is to return a person to the State where there is an outstanding warrant for the arrest and return to custody or detention of that person128. Consistently with that purpose, s 89(4) ensures that "proceedings in relation to an escape … be taken in the State ... to which the person was being taken, that is, the State … of issue of the 126 Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46-47 [47]; [2009] HCA 41. 127 For example, under the Service and Execution of Process Act 1901 (Cth), there was originally no provision which addressed escape from custody while the person was under an order remanding them to the State of issue made under that Act: Law Reform Commission, Service and Execution of Process, Report No 40, (1987) at 219 [438]. In 1991, the Service and Execution of Process Amendment Act 1991 (Cth) was passed, which introduced a number of new provisions into the Service and Execution of Process Act 1901 (Cth), including s 19ZC(2), which can be seen to be the predecessor to s 89(4) of the SEP Act. 128 s 83(8)(b) of the SEP Act, read with the definitions of "warrant" and "authority" in s 81A. apprehension process"129. Here, that State was New South Wales. It makes practical sense for a person who has escaped from lawful custody while subject to an order under s 83(8)(b) to be dealt with by the authorities of New South Wales under New South Wales law upon their return to New South Wales. In enacting s 89(4) of the SEP Act, the Commonwealth Parliament made a deliberate decision to enact an "application" provision. It did so for the purpose of creating liability by reference to a State law and choosing which State law that should be. If s 89(4) applied State law otherwise than according to its terms, and without some of its elements, that purpose would be frustrated because it would no longer be applying the chosen State law. It would be creating a new and independent federal offence, the elements of which are unclear. That result would cause practical difficulties for the prosecution, the defence, and the trial judge alike. In some circumstances, a person may not be liable under s 89(4) because they do not satisfy the elements of the applied State law on its own terms. But that consequence is not at odds with the purpose of s 89(4). As noted earlier, that is a consequence of the deliberate decision of the Commonwealth Parliament to apply State laws to create criminal liability rather than create or define a specific federal offence to achieve a similar result. The New South Wales Parliament, in enacting s 310D of the Crimes Act, and unlike the common law offence of escaping lawful custody, has chosen to criminalise particular conduct by a particular class of persons – "inmates". The Commonwealth Parliament, through s 89(4) of the SEP Act, has chosen for that law to apply to create potential liability in particular circumstances to the exclusion of other potentially applicable laws. The substantive elements of s 310D do not need to be altered for the purpose of s 89(4) to be achieved. Section 310D of the Crimes Act The next question is whether the appellant could be guilty of the Charge, an offence contrary to s 310D(a) of the Crimes Act. Two issues arise. First, what elements must the prosecution prove and, second, are those elements capable of proof in relation to the appellant? Throughout the history of these proceedings, the appellant has contended that he was not an "inmate", and is not capable of satisfying the definition of "inmate", within the meaning of s 310D of the Crimes Act. He has not 129 Law Reform Commission, Service and Execution of Process, Report No 40, (1987) at 219 [438]. See also at 152-153 [319]. In relation to the legislative history, see [103] above. contended, and does not contend, that the other elements of s 310D of the Crimes Act are not capable of being satisfied. An "inmate" is relevantly a person who (a) is the subject of a warrant or order; (b) where the warrant or order committed the person to a "correctional centre"; and (c) the warrant or order was made by a "court" or "other competent authority"130. Each element must be satisfied. First, as to (a), the appellant was the subject of orders validly made under s 83(8)(b) of the SEP Act – the SEPA Orders. As to (b), the SEPA Orders required that the appellant be "returned to SYDNEY POLICE CENTRE in the State of NSW". In Pt 6A of the Crimes Act, entitled "Offences relating to escape from lawful custody" (which contains s 310D), s 310A relevantly provides that "[i]n this Part", "correctional centre" means "a correctional centre within the meaning of [the CAS Act]". Section 3(1) of the CAS Act defines "correctional centre" to include "any police station ... in which an offender is held in custody in accordance with this or any other Act". The Sydney Police Centre is a "correctional centre" within the meaning of the CAS Act. The SEPA Orders committed the appellant to a correctional centre. As to (c), the SEPA Orders were made by a Victorian magistrate. "[C]ourt" is defined in s 3(1) of the CAS Act to mean a number of specific courts or "any other court that, or person who, exercises criminal jurisdiction" (emphasis added). The word "person" and the use of the word "exercises" (rather than "exercised") in that definition extend the definition of "court" to include persons who are capable of exercising criminal jurisdiction. The Victorian magistrate who made the SEPA Orders "exercises" criminal jurisdiction131 and therefore satisfied the definition of "court" within the meaning of s 4(1)(d) and (e) of the CAS Act. Moreover, the Victorian magistrate was empowered by s 83(8)(b) of the SEP Act to commit the appellant to a correctional centre. The Victorian magistrate was therefore a "competent authority" within the meaning of s 4(1)(e) of the CAS Act132. It might be thought that the Acts Interpretation Act 1901 (Cth) would apply to the interpretation of surrogate federal laws such as s 310D of the Crimes Act as applied by s 89(4) of the SEP Act133. However, s 89(4) of the SEP Act 130 See [79] above. 131 s 25 of the Magistrates' Court Act 1989 (Vic). 132 cf Barnes v Kuser (2007) 179 A Crim R 181 at 184-185 [19]-[25]. 133 cf s 5(1) of the CPAL Act. picks up "the law" relating to liability for escaping from lawful custody. That law, in New South Wales, includes the Interpretation Act 1987 (NSW). Section 12(1)(a) of the Interpretation Act 1987 (NSW) relevantly provides that "[i]n any Act … a reference to an officer, office or statutory body is a reference to such an officer, office or statutory body in and for New South Wales". However, s 12 must be read subject to s 5(2), which relevantly provides: "This Act applies to an Act or instrument except in so far as the contrary intention appears … in the Act or instrument concerned." (emphasis added) The contrary intention appears in s 310D of the Crimes Act when "applied" by s 89(4) of the SEP Act to empower a Victorian magistrate to commit the appellant to a correctional centre in New South Wales. That limited alteration is necessary to ensure s 89(4) achieves its purpose134. However, it is not necessary to put "to one side the carefully crafted definitions of 'inmate'"135 – an essential element of the relevant New South Wales offence – to ensure s 89(4) achieves its purpose. The elements of s 310D are capable of proof in relation to the appellant. However, contrary to the conclusion reached by the Court of Appeal, all elements of s 310D(a) must be proved. Orders The appeal should be dismissed with costs. By reason of the application of s 89(4) of the SEP Act, the appellant could be guilty of an offence contrary to s 310D(a) of the Crimes Act. 134 John Robertson (1973) 129 CLR 65 at 95. 135 Mok v Director of Public Prosecutions (NSW) (2015) 320 ALR 584 at 595 [51].
HIGH COURT OF AUSTRALIA FARM TRANSPARENCY INTERNATIONAL LTD & ANOR PLAINTIFFS AND STATE OF NEW SOUTH WALES DEFENDANT Farm Transparency International Ltd v New South Wales [2022] HCA 23 Date of Hearing: 10 & 11 February 2022 Date of Judgment: 10 August 2022 ORDER Questions 2 and 4 of the questions of law stated for the opinion of the Full Court in the amended special case filed on 6 October 2021 be amended, and the questions stated in the amended special case (as further amended) be answered as follows: Does section 11 of the Surveillance Devices Act 2007 (NSW) political impermissibly communication? freedom implied burden the Answer, "Section 11 does not impermissibly burden the implied freedom of political communication in its application to the communication or publication by a person of a record or report of the carrying on of a lawful activity, at least where the person was complicit in the record or report being obtained exclusively by breach of s 8 of the Surveillance Devices Act. It is unnecessary to determine whether s 11 burdens the implied freedom of political communication in other applications". If "yes" to Question 1, is s 11 of the Surveillance Devices Act 2007 (NSW) able to be partially disapplied in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Answer, "If s 11 were invalid in some of its operations, it could be partially disapplied to the extent of that invalidity. Otherwise, this question is unnecessary to answer". Does section 12 of the Surveillance Devices Act 2007 (NSW) impermissibly political communication? freedom implied burden the Answer, "Section 12 does not impermissibly burden the implied freedom of political communication in its application to the possession by a person of a record of the carrying on of a lawful activity, at least where the person was complicit in the record being obtained exclusively by breach of s 8 of the Surveillance Devices Act. It is unnecessary to determine whether s 12 burdens the implied freedom of political communication in other applications". If "yes" to Question 3, is s 12 of the Surveillance Devices Act 2007 (NSW) able to be partially disapplied in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Answer, "If s 12 were invalid in some of its operations, it could be partially disapplied to the extent of that invalidity. Otherwise, this question is unnecessary to answer". Who should pay costs? Answer, "The plaintiffs should pay the defendant's costs". Representation P J Dunning QC with A Aleksov for the plaintiffs (instructed by Bleyer Lawyers Pty Ltd) M G Sexton SC, Solicitor-General for the State of New South Wales, with M W R Adams for the defendant (instructed by Crown Solicitor's Office (NSW)) S P Donaghue QC, Solicitor-General of the Commonwealth, with T M Wood and J R Wang for the Attorney-General of the Commonwealth, intervening (instructed by Australian Government Solicitor) J A Thomson SC, Solicitor-General for the State of Western Australia, with G M Mullins for the Attorney-General for the State of Western Australia, intervening (instructed by State Solicitor's Office (WA)) G A Thompson QC, Solicitor-General of the State of Queensland, with F J Nagorcka and K J E Blore for the Attorney-General of the State of Queensland, intervening (instructed by Crown Law (Qld)) M J Wait SC, Solicitor-General for the State of South Australia, with K M Scott for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor's Office (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Farm Transparency International Ltd v New South Wales Constitutional law (Cth) – Implied freedom of communication about governmental or political matters – Where s 8 of Surveillance Devices Act 2007 (NSW) ("SD Act") relevantly prohibited knowing installation, use or maintenance of optical surveillance device on or within premises to record visually or observe carrying on of activity if installation, use or maintenance of device involved trespass – Where ss 11 and 12 of SD Act prohibited, respectively, publication or communication of record or report, and possession of record, obtained in contravention of, relevantly, s 8 of SD Act – Whether ss 11 and 12 burdened implied freedom – Whether provisions for legitimate purpose – Whether provisions suitable, necessary and adequate in balance. Words and phrases – "adequate in its balance", "breach of confidence", "burden", "complicit trespass", "implied freedom of political communication", "incremental burden", "lawful activity", "legitimate purpose", "mens rea", "optical surveillance device", "partially disapplied", "privacy", "public interest", "reasonably necessary", "structured proportionality", "suitable", "surveillance devices", "trespass". Surveillance Devices Act 2007 (NSW), ss 8, 11, 12. KIEFEL CJ AND KEANE J. The first plaintiff, Farm Transparency International Ltd, is a company and a not-for-profit charity which seeks to raise public awareness of animal cruelty and to increase an understanding of the importance of the prevention and alleviation of animal suffering. It seeks to improve the treatment of animals including through changes to the law, policy, practice and custom. In particular, the first plaintiff has agitated and advocated for political and legal changes to animal agricultural practices and animal welfare standards with the objective of ending modern farming and slaughtering practices. In doing so it has engaged in the publication of photographs, videos and audio-visual recordings of animal agricultural practices in Australia, including in New South Wales. The second plaintiff, Christopher James Delforce, is a director of the first plaintiff and an activist for animal welfare and animal rights. The second plaintiff has participated in the entry onto the property of others to install, use or maintain an optical surveillance device to record the carrying out of an activity on the premises without the consent of the owner or occupier of the premises, which is to say the recordings were obtained through an act of trespass. The second plaintiff's affidavit, annexed to the Amended Special Case ("the ASC"), suggests that the premises were associated with the farming or slaughter of animals and that the recordings obtained were published by the plaintiffs. At issue in the ASC is the validity of ss 11 and 12 of the Surveillance Devices Act 2007 (NSW) ("the SD Act"), which, subject to certain conditions and exceptions, respectively prohibit the publication of a record of the kind mentioned above, and the possession of such record, where it has been obtained in contravention of provisions of Pt 2 of the SD Act, which in turn would include the circumstances referred to above concerning the second plaintiff's conduct. It is the plaintiffs' case that ss 11 and 12 effect a significant burden on the constitutionally guaranteed freedom1 of persons to make known, to the public and to government, practices which involve cruelty to animals. It cannot be doubted that cruelty to animals is an important issue for society and for legislatures such as the New South Wales Parliament, and that persons and groups such as the plaintiffs have sought to achieve changes to laws directed to that issue. At the same time, there has been discussion about the rights of farmers, especially in relation to trespass on farms. The history of policy discussions and legislative actions in New South Wales2 bears out the attention which has been directed to these topics. They Lange v Australian Broadcasting Corporation (1997) 189 CLR 520. See, eg, Farm Trespass: Action Plan for National Implementation of the NSW Farm Incursion Policy 2014 (2016); Inclosed Lands, Crimes and Law Enforcement Legislation Amendment (Interference) Act 2016 (NSW); Rural Crime Legislation are but one aspect of the broader implied freedom of communication on matters of politics and government. The legislative purpose of the relevant provisions of the SD Act, which ss 11 and 12 further, is the protection of privacy. They pursue that purpose largely by preventing and deterring conduct which amounts to a trespass on the property of others. This is a legislative choice made by the New South Wales Parliament. The role of this Court is to determine whether, in the pursuit of that purpose, the freedom of political communication, understood more generally, has been impermissibly burdened or restricted. Such a conclusion might be reached where the means chosen to achieve what is, in law, a legitimate purpose, lacks proportionality. That engages the legal analysis required by this Court's decisions in McCloy v New South Wales and subsequent cases3. The SD Act provisions The SD Act came into force in New South Wales on 1 August 2008, following the repeal of the Listening Devices Act 1984 (NSW). Its purpose is stated by s 2A to be: "Objects of Act The objects of this Act are – to provide law enforcement agencies with a comprehensive framework for the use of surveillance devices in criminal investigations, and Amendment Act 2017 (NSW); New South Wales, Department of Primary Industries, Animal Welfare Action Plan (2018); Right to Farm Act 2019 (NSW); New South Wales, Legislative Council, Select Committee on Animal Cruelty Laws in New South Wales, Inquiry into animal cruelty laws in New South Wales: Terms of Reference (2020); New South Wales, Legislative Council, Select Committee on Animal Cruelty Laws in New South Wales, Animal cruelty laws in New South to related Wales, Report No 1 (2020); New South Wales, Response recommendations arising out of the 2018 Parliamentary Inquiry into Landowner Protection from Unauthorised Filming or Surveillance (2020). 3 McCloy v New South Wales (2015) 257 CLR 178; Brown v Tasmania (2017) 261 CLR 328; Clubb v Edwards (2019) 267 CLR 171; Comcare v Banerji (2019) 267 CLR 373; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490; 391 ALR to enable law enforcement agencies to covertly gather evidence for the purposes of criminal prosecutions, and to ensure that the privacy of individuals is not unnecessarily impinged upon by providing strict requirements around the installation, use and maintenance of surveillance devices." The focus here is on s 2A(c) and the "privacy of individuals". Part 2 of the SD Act, headed "Regulation of installation, use and maintenance of surveillance devices", creates a number of offences. Sections 7 to 10 concern the use of surveillance devices to record conversations, activities or information concerning a person. Sections 11 and 12 concern the publication and possession of records so obtained. Section 7(1) of the SD Act prohibits the knowing installation, use or maintenance of a listening device to overhear, record, monitor or listen to a private conversation. It is subject to certain exceptions. A contravention of the section is an offence subject to a penalty. Section 8(1) of the SD Act is most obviously relevant to the facts of the ASC. Section 8(1) provides that: "A person must not knowingly install, use or maintain an optical surveillance device on or within premises or a vehicle or on any other object, to record visually or observe the carrying on of an activity if the installation, use or maintenance of the device involves – entry onto or into the premises or vehicle without the express or implied consent of the owner or occupier of the premises or vehicle, interference with the vehicle or other object without the express or implied consent of the person having lawful possession or lawful control of the vehicle or object. Maximum penalty – 500 penalty units (in the case of a corporation) or 100 penalty units or 5 years imprisonment, or both (in any other case)." An "optical surveillance device" is defined by s 4(1) to mean "any device capable of being used to record visually or observe an activity". Sub-section (2) of s 8 provides that sub-s (1) does not apply in certain circumstances not presently relevant. Sections 9 and 10 contain prohibitions on the installation, use and maintenance of tracking devices and data surveillance devices respectively. No challenge is brought by the plaintiffs to the validity of sections 7 to 10. The plaintiffs accept that they are valid laws. The sections the subject of challenge, ss 11 and 12, are in these terms: "11 Prohibition on communication or publication of private conversations or recordings of activities (1) A person must not publish, or communicate to any person, a private conversation or a record of the carrying on of an activity, or a report of a private conversation or carrying on of an activity, that has come to the person's knowledge as a direct or indirect result of the use of a listening device, an optical surveillance device or a contravention of a provision of this Part. tracking device Maximum penalty – 500 penalty units (in the case of a corporation) or 100 penalty units or 5 years imprisonment, or both (in any other case). Subsection (1) does not apply to the following – if the communication or publication is made – to a party to the private conversation or activity, (ii) with the consent, express or implied, of all the principal parties to the private conversation or activity, or (iii) for the purpose of investigating or prosecuting an offence against this section, or in the course of proceedings for an offence against this Act or the regulations, if the communication or publication is no more than is reasonably necessary in connection with an imminent threat of – serious violence to persons or of substantial damage to property, or commission of a serious narcotics offence. (3) A person who obtains knowledge of a private conversation or activity in a manner that does not involve a contravention of a provision of this Part is not prevented from communicating or publishing the knowledge so obtained even if the same knowledge was also obtained in a manner that contravened this Part. Possession of record of private conversation or activity (1) A person must not possess a record of a private conversation or the carrying on of an activity knowing that it has been obtained, directly or indirectly, by the use of a listening device, optical surveillance device or tracking device in contravention of this Part. Maximum penalty – 500 penalty units (in the case of a corporation) or 100 penalty units or 5 years imprisonment, or both (in any other case). Subsection (1) does not apply where the record is in the possession of the person – in connection with proceedings for an offence against this Act or the regulations, or (b) with the consent, express or implied, of all of the principal parties to the private conversation or persons who took part in the activity, or as a consequence of a communication or publication of that record to that person in circumstances that do not constitute a contravention of this Part." Questions in the Amended Special Case It is not in dispute that the communication to others of an activity carried out on premises of the kind mentioned above may amount to a political communication which is the subject of the constitutionally protected implied freedom4. The freedom operates as a restriction upon legislative power5 and is the Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 566-567. 5 Unions NSW v New South Wales (2013) 252 CLR 530 at 554 [36]; McCloy v New South Wales (2015) 257 CLR 178 at 202-203 [30]; Brown v Tasmania (2017) 261 basis of the plaintiffs' challenge to the constitutional validity of ss 11 and 12 of the SD Act. The plaintiffs and the defendant have agreed that the following questions be referred to a full bench of this Court for determination: Does section 11 of the SD Act impermissibly burden the implied freedom of political communication? If "yes" to Question 1, is section 11 of the SD Act severable in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Does section 12 of the SD Act impermissibly burden the implied freedom of political communication? If "yes" to Question 3, is section 12 of the SD Act severable in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? 5. Who should pay costs? The limits of the Amended Special Case The facts stated in the ASC are that the first plaintiff has engaged in conduct that purportedly contravenes ss 11 and 12 of the SD Act and may in the future engage in such conduct. Likewise, the second plaintiff has in the past and may in the future engage in conduct that purportedly contravenes ss 11 and 12. The conduct engaged in or to be engaged in is not specified in the ASC. Only the second plaintiff identifies conduct by him as having purportedly contravened s 8 of the SD Act. He may therefore be taken to have entered onto premises without the consent of the owner or occupier to knowingly install, use or maintain an optical surveillance device to record the carrying on of an activity on the premises. The ASC does not contain any facts which point to either of the plaintiffs' conduct as having involved s 7, s 9 or s 10. In a passage in an affidavit relied on by the plaintiffs, it is said that if the first plaintiff receives information in the future, "whether video footage or audio recordings or otherwise", which depicts animal cruelty, it would "wish to publish that information". This takes the matter no further for the plaintiffs. It is not CLR 328 at 360 [90], 374 [150], 398 [237], 407 [258], 410 [262], 430 [313], 466 sufficient to establish a state of facts relevant to the engagement of s 7 of the SD Act. It is not suggested that the first plaintiff has ever published private conversations recorded by listening devices contrary to s 7. The plaintiffs' submissions proceed upon the basis that they are entitled to challenge ss 11 and 12 in all their operations respecting ss 7 to 10. Such an entitlement does not follow from the concession by the defendant that the plaintiffs have standing. The existence of standing does not mean that the plaintiffs can "roam at large" over the statutory provisions6. As recently restated in Mineralogy Pty Ltd v Western Australia7, this Court takes a "cautious and restrained" approach to answering questions concerning the constitutional validity of provisions. The parties to a special case have no entitlement to expect an answer on a question of law stated in that special case unless the Full Court can be satisfied that "there exists a state of facts which makes it necessary to decide [the] question in order to do justice in the given case and to determine the rights of the parties"8. The plaintiffs are entitled to advance only those grounds of challenge which bear on the validity of ss 11 and 12 in their application to the plaintiffs9. At the most, it may be said that the conduct of the second plaintiff is of a kind to which s 8 refers. The plaintiffs are then properly confined to challenging the validity of ss 11 and 12 as engaged by s 8. The relevant parts of ss 11 and 12 that are engaged are those which prohibit the publication and possession of a record of the carrying on of an activity obtained in contravention of s 8. The mental elements of s 11 A difference may be observed in the statement of the offences under ss 11 and 12 concerning the element of knowledge of a contravention of Pt 2. In s 12 it is an element of the offence, which must therefore be proved, that the possessor of 6 Knight v Victoria (2017) 261 CLR 306 at 324-325 [33]; Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 847 [59]; 393 ALR 551 at 566. (2021) 95 ALJR 832 at 846 [57]; 393 ALR 551 at 565. 8 Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 846 [56]; 393 ALR 551 at 565, quoting Lambert v Weichelt (1954) 28 ALJ 282 at 283. See also Duncan v New South Wales (2015) 255 CLR 388 at 410 [52]; Knight v Victoria (2017) 261 CLR 306 at 324 [32]; Zhang v Commissioner of the Australian Federal Police (2021) 95 ALJR 432 at 437 [21]; 389 ALR 363 at 368; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 511 [90]; 391 ALR 188 at 210. 9 Knight v Victoria (2017) 261 CLR 306 at 325 [33]. the record of the carrying on of an activity knows that the record has been obtained by the use of an optical surveillance device in contravention of Pt 2. Section 11 speaks only of a person's knowledge as an awareness of a record of an activity which is brought about by the use of a surveillance device in contravention of Pt 2, rather than an awareness of that contravention. In their original submissions the plaintiffs drew attention to the absence of any express reference in s 11 to the person publishing the record having knowledge that it was obtained in contravention of Pt 2. This led them to submit that the offence was one of strict liability which arose whenever a provision of Pt 2 was contravened, without more. On this understanding the operation of s 11 would be broad. This is not a position which they continue to maintain in the face of authority. It is well settled that mens rea, or a knowledge of the wrongfulness of an act, is an essential element in every statutory offence unless it is expressly or by necessary implication excluded by the statute10. The law makes two presumptions which are implied as elements in a statutory offence. The first is that the person does the physical act defined in the offence voluntarily and with the intention of doing the act. The second, which is here relevant, relates to the external elements of a statutory offence, being the circumstances which attend the doing of the physical act. The law implies as an element of the offence that at the time when the person does the physical act involved, they know the circumstance which makes the doing of that act an offence or do not believe honestly and on reasonable grounds that the circumstances are such as to make the doing of the act innocent11. Since there are no express words or any implications to prevent the presumption applying to s 11, it is taken to be an element of the offence there stated that the person publishing the record must have known that s 8 has been contravened in making the record, or was reckless as to that fact. No offence is committed unless a person is shown to have that state of mind. This will be relevant in determining the extent to which the SD Act operates to burden the implied freedom. A burden on the implied freedom of political communication The free flow of communication on matters of politics and government is implied in the Constitution as necessary to the maintenance of the system of 10 Sherras v De Rutzen [1895] 1 QB 918 at 921, cited in He Kaw Teh v The Queen (1985) 157 CLR 523 at 528 per Gibbs CJ, 549 per Wilson J, 566 per Brennan J. 11 He Kaw Teh v The Queen (1985) 157 CLR 523 at 570-571, 582 per Brennan J. government for which the Constitution provides12. It is of such importance that a statutory provision which has the effect of burdening it, by restricting or limiting such communication, must be justified13. It is sufficient for a law to require justification that it effects any burden on the freedom. The extent of that burden assumes importance in the later process of justification. The question whether the freedom is burdened has regard to the legal and practical operation of the law14. The question is not how it may operate in specific cases, which are but illustrations of its operation, but how the statutory provision affects the freedom more generally15. The defendant properly concedes that, in their operation, ss 11 and 12 may burden the implied freedom. Communications about activities carried out on premises may be political in nature and the provisions prohibit those communications, or the possession of information about those activities for the purposes of those communications. Such communications may include discussions of animal welfare, a legitimate matter of governmental and political concern16 and a matter in respect of which persons may seek to influence government. That is not to say that ss 11 and 12, as engaged by s 8, are directed to the content of what is published. They are not. They are relevantly directed more generally to records of activities which are obtained by unlawful means using optical surveillance devices. The process of justification commences with the identification of the statutory purpose. That purpose must be compatible with the system of representative government for the provision to be valid17. A justification for a 12 Unions NSW v New South Wales (2013) 252 CLR 530 at 551 [27]; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 504 [44]; 391 ALR 188 at 199. 13 McCloy v New South Wales (2015) 257 CLR 178 at 213 [68]; Brown v Tasmania (2017) 261 CLR 328 at 369 [127]; Comcare v Banerji (2019) 267 CLR 373 at 399 [29]; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 504 [45]; 391 ALR 188 at 199. 14 Brown v Tasmania (2017) 261 CLR 328 at 358 [84], 367 [118], 431 [316], 433-434 15 Brown v Tasmania (2017) 261 CLR 328 at 360 [90]. 16 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 286-287 [217] per Kirby J. 17 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562, 567; McCloy v New South Wales (2015) 257 CLR 178 at 203 [31]; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 504 [45]; 391 ALR 188 at 199-200. burden will only be sufficient if it is shown that the statutory provision is proportionate to the achievement of its purpose18. Since McCloy v New South Wales19, including more recently in LibertyWorks Inc v The Commonwealth20, proportionality has been assessed by reference to whether the impugned provision is suitable, necessary and adequate in its balance21. Legitimacy of purpose The plaintiffs accept that the purposes stated in s 2A are legitimate. The purposes stated in s 2A of the SD Act extend beyond those relevant to law enforcement agencies, which may use surveillance devices in criminal investigations and to gather evidence for prosecutions. Section 2A(c) states an object of the SD Act to be to ensure that the privacy of individuals is not unnecessarily impinged upon and it says that it seeks to achieve that purpose by providing strict requirements around the installation, use and maintenance of surveillance devices. Sections 7 to 10 may be understood to be those strict requirements. Section 8 prohibits the installation, use or maintenance of an optical surveillance device to record the carrying on of an activity on premises (or in a vehicle) where the installation, use or maintenance of the device involves entry onto premises constituting a trespass. Although privacy may generally be understood to be concerned with personal autonomy22, it may also take its meaning from statutory context. Section 8 may be understood to protect the interest in privacy which arises out of the enjoyment of private property23. It adopts the policy 18 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 562; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 504 [46]; 391 ALR (2015) 257 CLR 178. (2021) 95 ALJR 490 at 504 [46] per Kiefel CJ, Keane and Gleeson JJ; 391 ALR 188 21 Brown v Tasmania (2017) 261 CLR 328 at 368 [123] per Kiefel CJ, Bell and Keane JJ, 416-417 [278] per Nettle J; Clubb v Edwards (2019) 267 CLR 171 at 200- 202 [70]-[74] per Kiefel CJ, Bell and Keane JJ, 264-265 [266] per Nettle J, 311 [408], 330-331 [463] per Edelman J; Comcare v Banerji (2019) 267 CLR 373 at 400 [32] per Kiefel CJ, Bell, Keane and Nettle JJ. 22 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 256 [125] per Gummow and Hayne JJ. 23 TCN Channel Nine Pty Ltd v Anning (2002) 54 NSWLR 333 at 344-345 [52]. of the common law and furthers the protections afforded by the law of trespass to prohibit optical surveillance being conducted on private property. It seeks to prevent interference with "the possession of property and the privacy and security of its occupier"24. So understood, the purpose of s 8 is to protect privacy and the incidents of the possession of property as relevant to it. It does so by making conduct enabled by trespass an offence and thereby discouraging it. The publication of an optical surveillance record of activities conducted on premises might further erode the privacy interests of those having possession of the property. Sections 11 and 12 are intended to limit the damage to those interests caused by the publication of material obtained in contravention of s 8. Section 11, to which s 12 is largely preparatory, may be understood to further those purposes. Its prohibitions on publication are intended not only to deter the publication of a record unlawfully obtained but also to deter a contravention of s 8 and lessen the likelihood of it occurring. It may be seen to have that purpose because it seeks to prevent the use of the product of the initial unlawful act. Sections 11 and 12 have proper purposes as laws. They do not impede the functioning of representative government and what that entails25 and are therefore legitimate in the sense relevant to the implied freedom. The plaintiffs submit that a purpose of ss 11 and 12 is to effect a "gag" on discussions about the agricultural practices with which the plaintiffs are concerned. It is correct to observe, as is stated in the ASC, that the expression "farm trespass" has been adopted by the New South Wales Government in recent years to describe a range of conduct that includes persons entering farming properties without consent for the purposes of advocacy and protest. As the ASC records, Select Committees of the New South Wales Parliament have considered the effects of trespass and unauthorised surveillance devices on farmers and farming operations; have considered issues around the effectiveness of animal cruelty laws; and have made recommendations concerning legislative changes. None of these reports are relevant to the SD Act as enacted and its purpose. The plaintiffs' submissions essentially fail to distinguish between an effect of an impugned provision and statutory purpose26. It may be that a consequence of ss 11 and 12 is that some reporting of agricultural practices is prevented, at least in cases where the publisher 24 Plenty v Dillon (1991) 171 CLR 635 at 647. 25 McCloy v New South Wales (2015) 257 CLR 178 at 203 [31]; Clubb v Edwards (2019) 267 CLR 171 at 194 [44]. 26 McCloy v New South Wales (2015) 257 CLR 178 at 205 [40]; Brown v Tasmania (2017) 261 CLR 328 at 362 [100]. knows of the antecedent trespassory conduct, but that effect cannot be equated with their statutory purpose. Suitability The requirement of suitability is not in issue in the present case. There is no dispute that the measures provided for in ss 11 and 12 are rationally connected to the purposes which they seek to achieve27. The burden and its extent It has been mentioned earlier in these reasons that the extent to which ss 11 and 12 of the SD Act burden the freedom assumes importance in the process of justifying the law. The extent of the burden is relevant in considering the alternative measures which may be employed to achieve the same statutory purpose, and which may be less burdensome in effect. It is also relevant in considering adequacy of balance, where consideration is given to the extent of the burden and the importance of the statutory purpose. The extent of the burden effected by ss 11 and 12 is not to be assessed by reference to the operation and effect of those provisions alone. The burden effected by the prohibitions in ss 11 and 12 must be assessed by reference to the restraints which the law – understood as the common law, equity, and statute law – already imposes upon a person's ability to publish records of activities obtained surreptitiously and by conduct which amounts to trespass. The relevant burden is the incremental effect of the impugned law on the ability of a person to engage in a communication which the law may already validly restrict28. It is that burden which is to be justified. Consideration may first be given to what rights the common law and equity recognise, and which may be enforced to prevent publication of information obtained in the manner mentioned. The question of what causes of action might be applied to invasions of privacy was discussed in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd29. At issue in that case was whether an interlocutory injunction could issue with respect to the publication by the appellant 27 See Comcare v Banerji (2019) 267 CLR 373 at 400 [33]. 28 Levy v Victoria (1997) 189 CLR 579 at 625-626 per McHugh J; Brown v Tasmania (2017) 261 CLR 328 at 365 [109] per Kiefel CJ, Bell and Keane JJ, 383 [181], 385- 386 [188] per Gageler J, 408-409 [259] per Nettle J, 443 [357], 455 [393], 460 [411], 462 [420] per Gordon J, 502-503 [557]-[558], 507 [566] per Edelman J. (2001) 208 CLR 199. of film footage it had received showing the method by which possums were killed at a licensed abattoir, in circumstances where the footage had been obtained using hidden video cameras installed by unidentified trespassers. As Gummow and Hayne JJ observed30, the common law of Australia has not yet recognised a general right to privacy. The recognised causes of action to which their Honours referred31 as possibly having application in such circumstances included those for injurious falsehood, defamation (where truth was not a complete defence) and confidential information which concerned the personal affairs and private life of a person. So far as concerns the law of breach of confidence, Gleeson CJ observed32 that equity may impose obligations of confidentiality even though there is no imparting of information in circumstances of trust and confidence. Equity, acting on the principle of good faith, will restrain the publication of information which may be regarded as confidential and which was improperly or surreptitiously obtained. A photographic image or a film depicting activities that are private in nature, which were recorded by the methods employed in that case, would be protected33. A difficulty for the respondent in that case was that the activities secretly observed and filmed were not private in nature. His Honour observed that "a person who enters without permission is a trespasser; but that does not mean that every activity observed by the trespasser is private"34. Prior to the decision in Lenah Game Meats, in Lincoln Hunt Australia Pty Ltd v Willesee35, Young J expressed the view that even where no confidentiality was involved, a court might intervene to restrain publication of a videotape or photograph taken by a trespasser where the circumstances were such as to make it 30 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 250 [110]; see also Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502; 376 ALR 575. 31 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 32 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 33 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 34 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR (1986) 4 NSWLR 457 at 463. unconscionable. As noted in Smethurst v Commissioner of the Australian Federal Police36, little support for that view can be derived from the judgments in Lenah Game Meats. Gummow and Hayne JJ considered that the notion of unconscionable behaviour does not operate at large37. Gleeson CJ concluded38 that the fact that the information was obtained tortiously, by trespass, was not sufficient to make it unconscientious for a person into whose hands that information later comes to use or publish it. The respondent in Lenah Game Meats was unable to identify a legal or equitable right which could be pursued at trial and which would warrant the grant of an interlocutory injunction. The law of trespass could not avail it. It provides for a right to damages but not one to prevent the use of information obtained as a result of the trespass. It may be that the law of defamation will provide a basis in some cases to prevent the publication of defamatory matter contained in records of activities made by surveillance devices, subject to available defences. There may well be some cases where the law of confidential information will protect private activities filmed surreptitiously from publication, but much may depend on what activities qualify as "private", as Lenah Game Meats shows. It may be concluded that the common law and equity may be effective to prevent some, but certainly not all, publications. More to the point in the present case is s 8 of the SD Act, a law the validity of which is not challenged. An assessment of the burden effected by ss 11 and 12 must take as its starting point that the law prohibits the making of a record of activities on premises by the use of an optical surveillance device where a trespass is committed in doing so, and that the law imposes a substantial penalty for a contravention of that prohibition. On the other hand, s 8 will not be contravened if a person who is lawfully on the premises, for example an employee, makes a recording. If the prohibition in s 8 is obeyed, there should be no persons who would become subject to the prohibitions of ss 11 and 12. It is to be assumed that most (2020) 94 ALJR 502 at 525 [82]; 376 ALR 575 at 595; see also (2020) 94 ALJR 502 at 558 [242]-[244]; 376 ALR 575 at 638-639. 37 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 244-245 [98], Gaudron J agreeing at 231 [58]. 38 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR citizens will be obedient to the law39. Nevertheless, ss 11 and 12 add another level of prohibition directed to the communication of a record of activity obtained in breach of s 8. Importantly though, the prohibition applies only where there is conduct constituting a contravention of s 8, which includes trespassory conduct, and where the person publishing the record has knowledge of the circumstances which constitute the offence under s 8. All that is effectively burdened by ss 11 and 12 is the communication of information obtained through specified unlawful means to the knowledge of the person communicating that information. These are significant limitations on the extent of the burden. Necessity The test of reasonable necessity looks to whether there is an alternative measure available which is equally practicable when regard is had to the purpose pursued, and which is less restrictive of the freedom than the impugned provision40. The alternative measure must be obvious and compelling41. The mere existence of another measure capable of achieving the same purpose will not be sufficient for a conclusion of lack of justification. The other measure must be equally practicable. To be equally practicable as the impugned provision, the alternative must achieve the same legislative purpose to the same degree, which is to say it must be possible to conclude that the alternative legislative measure is equally as effective42. Where there is a measure which has these qualities, the impugned 39 Potter v Minahan (1908) 7 CLR 277 at 304-305. 40 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568; Unions NSW v New South Wales (2013) 252 CLR 530 at 556 [44]; McCloy v New South Wales (2015) 257 CLR 178 at 210 [57], 217 [81]; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139]; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 509 [78]; 391 ALR 188 at 207. 41 Monis v The Queen (2013) 249 CLR 92 at 214 [347]; Tajjour v New South Wales (2014) 254 CLR 508 at 550 [36]; McCloy v New South Wales (2015) 257 CLR 178 at 210-211 [57]-[58]; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139]; Clubb v Edwards (2019) 267 CLR 171 at 186 [6], 262 [263], 265 [266(3)], 265-266 [267]-[268], 269 [277], 337-338 [478]-[480]; Comcare v Banerji (2019) 267 CLR 373 at 401 [35]; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 509 [78]; 391 ALR 188 at 207. 42 Tajjour v New South Wales (2014) 254 CLR 508 at 571 [113]-[114]; Unions NSW v New South Wales (2019) 264 CLR 595 at 614-615 [41]; Clubb v Edwards (2019) 267 CLR 171 at 336-337 [477]. legislative provision cannot be said to be necessary, in the sense that its choice is rational and therefore justified. The plaintiffs refer, as alternative measures, to the provisions of: the Surveillance Devices Act 1999 (Vic) ("the Victorian Act"); the Surveillance Devices Act 2016 (SA) ("the SA Act"); the Invasion of Privacy Act 1971 (Qld) ("the Queensland Act"); the Surveillance Devices Act 1998 (WA) ("the WA Act"); and the Surveillance Devices Act 2007 (NT) ("the NT Act"). The Queensland Act may be put to one side. It does not seek to regulate optical surveillance devices and records taken using them. The plaintiffs rely principally upon the Victorian Act and the provision it makes43, by way of exception to its prohibitions on knowingly publishing a record of a private activity obtained by use of a surveillance device, for the publication of such a record in the public interest. A similar exception is to be found in the NT Act. Each of the four relevant statutes referred to concerns the recording by a surveillance device, relevantly an optical surveillance device, of a "private activity". The Victorian Act44 prohibits the knowing installation, use or maintenance by a person of an optical surveillance device to record a "private activity" to which the person is not a party. A "private activity" is defined45 to be "an activity carried on in circumstances that may reasonably be taken to indicate that the parties to it desire it to be observed only by themselves", with certain exceptions. The Victorian Act also provides, by s 11(1), that, subject to sub-s (2), "a person must not knowingly communicate or publish a record or report of a private conversation or private activity that has been made as a direct or indirect result of the use of ... an optical surveillance device". By sub-s (2)(b)(i), sub-s (1) does not apply to a communication or publication that is no more than is reasonably necessary "in the public interest". The NT Act also creates offences regarding: the installation of an optical surveillance device to monitor a "private activity"46, which is defined in terms similar to the Victorian Act47; and the communication or publication of a record of a private activity, where the publisher knows it has been made as a direct or indirect 43 s 11(2)(b)(i). 47 See Victorian Act, s 3(1) (definition of "private activity"); NT Act, s 4 (definition of "private activity"). result of the use of an optical surveillance device48. The NT Act permits the communication or publication of a record if it is reasonably necessary in the public interest49. The SA Act and the WA Act contain similar offences relating to the use of optical surveillance devices and the publication of records of a private activity, but the question as to whether the latter is in the public interest is a matter for a judge50. The Victorian Act and the other statutes apply more broadly in the first instance than the SD Act. As earlier explained, the burden effected by ss 11 and 12 of the SD Act is significantly limited because they apply only where trespassory conduct has taken place and the publisher or possessor knows of such conduct. The Victorian and other mentioned State and Territory statutes, by contrast, apply their prohibitions to any publication of a record of a private activity made by an optical surveillance device. That is to say, the prohibition applies to the publication of a record howsoever obtained, whether lawfully or unlawfully. This casts doubt upon whether they truly effect a lesser burden on the freedom, at least in the first instance. The public interest exception may not ameliorate the burden which the other statutes effect to the extent for which the plaintiffs contend. The exception will only apply where it is shown that the dissemination of information about what is a private activity is truly in the public interest. This cannot be assumed to be an easy task. The plaintiffs may consider that in their area of concern it is more likely to be established, but the question of the burden effected on the freedom by statute is to be assessed more generally, by reference to its effect as a whole51. It may be accepted that, generally speaking, the other statutory schemes pursue the purpose of protection of privacy. But the privacy interest to which they refer differs from the SD Act. The Victorian and other statutes are based upon a conception of privacy viewed from the perspective of the parties to a private activity and their personal interests. The SD Act seeks to protect privacy interests in activities conducted on premises as an aspect of a person's possessory rights over their property. It may therefore be concluded that the Victorian and other statutes do not pursue the same purpose when regard is had to the interests that they seek to protect. 48 NT Act, s 15(1). 49 s 15(2)(b)(i). 50 SA Act, ss 10 and 11; WA Act, s 31. 51 Brown v Tasmania (2017) 261 CLR 328 at 360 [90]. It may also be accepted that a purpose of s 8 of the SD Act is to prevent or deter trespassory conduct. Sections 11 and 12 further that purpose. To make those provisions subject to a public interest exception would be inconsistent with the achievement of that purpose, since the exception is likely to have the effect of encouraging persons to unlawfully enter agricultural land to conduct surveillance of activities on it. The observation of a cross-agency working group of the New South Wales Government, in not recommending that a public interest exception be made to the SD Act52, was plainly correct. Moreover, it may be concluded by reference to ss 8, 11 and 12 that the New South Wales Parliament has largely decided where the public interest lies. It has chosen a scheme of regulation of optical surveillance devices where trespassory conduct is discouraged. It is to be inferred that it is the New South Wales Parliament's view that such conduct lies at the heart of the problems associated with the use of surveillance devices and their intrusion into privacy. A public interest exception to publication would fundamentally alter that scheme. It is not possible to conclude that it would operate in the same way or meet its objective. It cannot be said that such a measure would make the SD Act equally efficacious in the protections it seeks to provide. Adequacy of balance If, as here, a law presents as suitable and necessary, it is to be regarded as adequate in its balance unless the benefit sought to be achieved by the law is manifestly outweighed by its adverse effect on the implied freedom53. The protection of privacy interests has long been recognised as a social value which is protected by the tort of trespass54. Its importance is obvious. The burden effected by ss 11 and 12 of the SD Act on the freedom, in the pursuit of that purpose, cannot be said to be great. It is significantly limited by the prohibitions affecting only those communications made by persons who know that the records of activities they publish have been obtained by unlawful acts of trespass. 52 New South Wales, Response to related recommendations arising out of the 2018 Parliamentary Inquiry into Landowner Protection from Unauthorised Filming or Surveillance (2020) at 11. 53 Comcare v Banerji (2019) 267 CLR 373 at 402 [38]; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 510 [85]; 391 ALR 188 at 209. 54 TCN Channel Nine Pty Ltd v Anning (2002) 54 NSWLR 333 at 344-345 [52]. Answers The plaintiffs' challenge to the validity of ss 11 and 12 of the SD Act fails. We would propose that the following answers be given: Not necessary to answer. Not necessary to answer. The plaintiffs should pay the defendant's costs. The answers we propose to questions one and three are based upon a broader view of the valid operation of ss 11 and 12 of the SD Act than that taken by Edelman J (with whom Steward J agrees). Because we take that broader view, we are able to agree with his Honour that the sections do not impermissibly burden the implied freedom of political communication in its application to the communication or publication by a person of a record or report of the carrying on of a lawful activity, at least where the person was complicit in the record or report being obtained exclusively by breach of s 8 of the SD Act. On that basis, it would not be necessary to determine whether ss 11 and 12 burden the implied freedom in other applications. We also agree with the answers proposed by Edelman J with respect to questions two and four, as reformulated by his Honour, and question five. An account of the facts set out in the special case is given by Kiefel CJ and Keane J. Without repeating their Honours' account, I will need to supplement it in one matter of detail. For the reasons given by Kiefel CJ and Keane J, as well as by Gordon J, the question of law ripe for judicial determination on the facts set out in the special case is whether the prohibitions on the publication and possession of a visual record in ss 11 and 12 of the Surveillance Devices Act 2007 (NSW) infringe the constitutionally implied freedom of political communication in their application to a visual record that has resulted from a contravention of s 8. Farm Transparency International Ltd is shown by the special case to have been complicit in a contravention of s 8 engaged in by Mr Delforce in the past. That fact does not, in my opinion, confine the question for judicial determination more narrowly. Farm Transparency is described in the special case as having been established as a not-for-profit charity for purposes which include preventing and relieving the suffering of animals by raising public awareness of animal cruelty. It is described as having a practice of engaging in activities which include the publication of visual records of animal agricultural practices in New South Wales. An affidavit forming part of the special case deposes that all of its activities "are based on the photographic and audio-visual material it has taken, organised, received or obtained". The affidavit deposes that the photographic and audio-visual material Farm Transparency takes, organises, receives or obtains records animal agriculture practices of a kind that of their nature are never recorded voluntarily or with the consent of the proprietor of the agricultural business. The affidavit concludes by deposing that "[i]n the future, if [Farm Transparency] receives information, whether video footage or audio recordings or otherwise, that shows animal cruelty practices in New South Wales, [Farm Transparency] would wish to publish that information". Farm Transparency undoubtedly desires, and intends, to do that which it has done in the past and asks this Court to declare that it can lawfully do in the future: to publish and possess visual records of animal agricultural practices in New South Wales created by others in contravention of s 8. To the extent that it seeks declarations to that effect, its claim for relief is not hypothetical in a sense that is relevant to the exercise of jurisdiction55. Unless it is to be denied relief by reason of its past complicity in a contravention of s 8, it is entitled to an adjudication of the totality of its claim that the purported constraints imposed by ss 11 and 12 on its freedom to publish and possess visual records that have resulted 55 See The Commonwealth v Sterling Nicholas Duty Free Pty Ltd (1972) 126 CLR 297 from contraventions of s 8 infringe the constitutionally implied freedom of political communication56. The construction and legal operation of ss 11 and 12 are also explained by Kiefel CJ and Keane J, as well as by Gordon J. To the extent that their explanations of the elements of the offences created by those sections differ, I do not take a position. Enough for me is to note that neither offence is committed without knowledge that the visual record published or possessed was created by use of an optical surveillance device in circumstances of a trespass to private property criminally prohibited by s 8. Features of the legislative scheme which I consider to be of constitutional significance are the following. The legislative purpose is not exhausted by the object stated in s 2A(c). The broader purpose of s 8 is to protect the privacy of all activities that occur on private property. The prohibitions in ss 11 and 12 enhance the operation of s 8 by disincentivising breach of s 8 in accordance with what has elsewhere been described as "[t]he 'dry-up-the-market' theory, which posits that it is possible to deter an illegal act that is difficult to police by preventing the wrongdoer from enjoying the fruits of the crime"57. Exceptions in ss 11(3) and 12(2)(c) mean that neither prohibition applies to a visual record already in the public domain. Having noted those features of the legislative scheme at the outset, I am able to come immediately to the constitutional issue at the heart of the matter. The issue is whether it is compatible with the maintenance of the constitutionally prescribed system of government, for the purpose of protecting the privacy of activities on private property, to impose blanket prohibitions on the possession and communication of a visual record known to have been created as a result of a trespass to private property and not otherwise in the public domain. Implicit in that framing of the issue is rejection of any notion that the purpose of disincentivising contravention of a criminal prohibition can alone be a purpose capable of justifying a law that imposes a burden on freedom of political communication58. To accept such a notion would be to conflate the purpose of a 56 See Croome v Tasmania (1997) 191 CLR 119 at 125-127, quoting Toowoomba Foundry Pty Ltd v The Commonwealth (1945) 71 CLR 545 at 570 and Pharmaceutical Society of Great Britain v Dickson [1970] AC 403 at 433. 57 Bartnicki v Vopper (2001) 532 US 514 at 550. 58 Compare Bartnicki v Vopper (2001) 532 US 514 at 529-530, quoted in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 228-229 [48]. See also, in the Ch III context, Minister for Home Affairs v Benbrika (2021) 95 ALJR 166 at 192 [85]; 388 ALR 1 at 28. law – the "public interest sought to be protected and enhanced" by the law59 – with the means adopted by the law to achieve that purpose. The consequence would be to allow a legislative scheme to be designed to bootstrap itself into constitutional validity. The criminal prohibitions in ss 11 and 12 on communication and possession of a visual record, and the criminal prohibition in s 8 of the means of creation of a visual record, are complementary components of a single legislative scheme. By that legislative scheme, the privacy of activities on private property is sought to be protected. To the extent that the legislative scheme prohibits communication or possession of an extant visual record of the carrying on of an activity that is of governmental or political concern, it burdens freedom of political communication. That burden falls to be justified, if at all, by reference to the underlying legislative purpose of protecting the privacy of activities on private property. For reasons to be developed, I consider that the burden on freedom of political communication imposed by the blanket criminal prohibitions in ss 11 and 12, in their application to a visual record that has resulted from the use of an optical surveillance device in contravention of s 8, is unjustified. The result is that I consider each of the prohibitions, in that application, to infringe the constitutional guarantee of freedom of political communication. The significance of Lange The interest of an owner or occupier in the privacy of activities that occur on private property has long been an interest which the law has afforded a measure of protection60. Pursuit of the protection of that interest is doubtless compatible with the constitutionally prescribed system of government which the constitutional guarantee of freedom of political communication exists to protect. But even where it can be accepted without question that a law burdening freedom of political communication does so in pursuit of a purpose that is compatible with the constitutionally prescribed system of government, it cannot simply be accepted without question that the same law pursues that purpose in a manner that is compatible with the constitutionally prescribed system. 59 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 300. 60 Plenty v Dillon (1991) 171 CLR 635 at 647; TCN Channel Nine Pty Ltd v Anning (2002) 54 NSWLR 333 at 344-345 [52], 346 [58]; Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 533-534 [124]; 376 ALR 575 at To the contrary, as I have explained in the past61: "The implied constitutional freedom is a constraint on legislative design. It limits legislative options. The consequence of the implied constitutional freedom is that there are some legitimate ends which cannot be pursued by some means, the result of which in some circumstances is that some ends will not be able to be pursued to the same extent as they might have been pursued absent the implied constitutional freedom. Means which come at too great a cost to the system of representative and responsible government established by the Constitution must be abandoned or refined. Means which are overbroad may need to be narrowed." Appreciating the impact of the implied constitutional freedom on the measure of protection that can be afforded by law to the privacy of activities that occur on private property is assisted by examining what Lange v Australian Broadcasting Corporation62 held to be the impact of the implied constitutional freedom on the measure of protection that can be afforded by law to personal reputation. For the application of constitutional principle to be consistent, the impacts must be coherent. In Lange, the implied constitutional freedom was held to necessitate adjustment of the balance until then struck in the law of defamation between protection of personal reputation and freedom of speech. The adjustment involved extending the common law defence of qualified privilege to recognise that "each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the people of Australia"63. The precept of Lange is that freedom of communication to and between electors, and between electors and elected legislative and executive representatives, on matters of government and politics is an "indispensable incident" of the system of representative and responsible government prescribed by the Constitution64. Within the scope of the freedom is communication of 61 Tajjour v New South Wales (2014) 254 CLR 508 at 584 [163]. (1997) 189 CLR 520. (1997) 189 CLR 520 at 571. (1997) 189 CLR 520 at 559-560. See also Aid/Watch Inc v Federal Commissioner of Taxation (2010) 241 CLR 539 at 555-556 [44]. disagreeable or objectionable information from few to many by way of "agitation" for legislative and political change65. Explained in the language of Kirby J66: "The form of government created by the Constitution is not confined to debates about popular or congenial topics, reflecting majority or party wisdom. Experience teaches that such topics change over time. In part, they do so because of general discussion in the mass media." Lange's insight, first elucidated in Australian Capital Television Pty Ltd v The Commonwealth67 and Nationwide News Pty Ltd v Wills68, is that the majoritarian principle, upon which our system of representative and responsible government relies for its outworking, carries an inherent risk of legislative or executive impairment of "the capacity of, or opportunity for, the Australian people to form the political judgments required for the exercise of their constitutional functions"69. An aspect of that systemic risk is that "political communications unhelpful or inconvenient or uninteresting to a current majority might be unduly impeded"70. The implied freedom of political communication is a structural implication serving to safeguard the efficacy of the system against realisation of that systemic risk71. Lange's demand for legislative justification, and correlative judicial scrutiny, of a legislative or executive burden on freedom of political communication is attuned to its mitigation. 65 Aid/Watch Inc v Federal Commissioner of Taxation (2010) 241 CLR 539 at 555- 66 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR (1992) 177 CLR 106 at 143-145. (1992) 177 CLR 1 at 50-51. 69 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 51. See McCloy v New South Wales (2015) 257 CLR 178 at 227-228 [114]-[117], 265 [245]. 70 Brown v Tasmania (2017) 261 CLR 328 at 390 [202]. See also Unions NSW v New South Wales (2019) 264 CLR 595 at 622 [66]. 71 See Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 133-140; McCloy v New South Wales (2015) 257 CLR 178 at 222-230 [100]- Lange postulates, and Brown v Tasmania72 illustrates, that the balancing of the freedom to communicate on matters of government and politics against the protection of other legitimate societal interests is a matter for legislatures to "determine" but for courts to "supervise"73. Under our system of representative and responsible government, as under some other similar systems, "the degree of legislative time, consultation and effort cannot act as a justificatory shield to guard against constitutional scrutiny": "[w]hat is of utmost relevance is the resulting legislative choice"74. Legislative judgment about how a particular balance ought to be struck must be accorded respect. "But, in the ultimate analysis, it is for the [c]ourt to determine whether the constitutional guarantee has been infringed"75. The prohibitions infringe the constitutional guarantee It may well be legitimate to seek to dry up an illegal market for stolen goods by prohibiting the possession and sale of goods known to have been obtained by burglary. However, the market sought to be dried up by the prohibitions in this case is a constitutionally protected "marketplace of ideas"76. That marketplace is foundational to a "society organised under and controlled by law"77. Within the marketplace of ideas, factual information bearing on matters of political and governmental concern known to its possessor and potential communicator to be true is all too often in short supply. The prohibitions on communication and possession in question remove one source of that supply of true factual information having the potential to bear on matters of political and governmental concern. The source removed – visual imagery – is of its nature not only factual but peculiarly communicative. In Levy v Victoria, McHugh J adopted the submission of counsel that "[t]he impact of television depiction of the actual perpetration of cruelty, whether to humans or to other living creatures, has a dramatic impact that is totally different [from] saying, (2017) 261 CLR 328. 73 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 50. See McCloy v New South Wales (2015) 257 CLR 178 at 230 [123]. 74 Quebec (Attorney General) v A [2013] 1 SCR 61 at 233 [363]. 75 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 76 See Abrams v United States (1919) 250 US 616 at 630. See also Ridd v James Cook University (2021) 95 ALJR 878 at 887 [31]; 394 ALR 12 at 23. 77 McCloy v New South Wales (2015) 257 CLR 178 at 229-230 [122], quoting Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 142 and Samuels v Readers' Digest Association Pty Ltd (1969) 120 CLR 1 at 15. 'This is not a good idea'"78. The internet and the smartphone have only reinforced the persuasive power of visual imagery. Not only do the blanket prohibitions on possession and communication of a visual record known to have been created as a result of a trespass to private property remove a source of peculiarly communicative true factual information capable of bearing on matters of political and governmental concern. They do so indiscriminately – regardless of the gravity of the information and of the extent to which electors, their elected representatives and executive officers may have an interest in receiving it. Having regard to those considerations, I am of the opinion that the prohibitions impose a greater burden on political communication than can in all circumstances be justified as appropriate and adapted to the protection of the privacy of activities on private property. The prohibitions are too blunt; their price is too high; the cost they impose on the communication and receipt of information about matters of political and governmental concern is more than could be warranted for every activity which might be shown by a visual record to have occurred on private property. Expressed in terminology extolled in and since McCloy v New South Wales, the prohibitions are not "adequate in [their] balance"79. That the qualitative extent of the burden on communication and receipt of information about matters of political and governmental concern is more than can be justified for the purpose of protecting the privacy of activities on private property is sufficiently illustrated by Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd80. There the recorded facts were as follows81: "Lenah Game Meats Pty Ltd conducted the business of processing game meat, including possum meat which it sold for export. It killed and processed Tasmanian brush tail possums at licensed abattoirs. An unidentified person or persons broke and entered the abattoirs and, by boring holes in the roof, installed hidden video cameras. Those cameras recorded the possum-killing operations without the consent or knowledge of Lenah Game Meats. The cameras and video recording were retrieved by an unidentified person or persons and the recording was supplied to Animal Liberation Ltd (Animal Liberation), which, in turn, supplied the recording (1997) 189 CLR 579 at 624. (2015) 257 CLR 178 at 195 [2]. (2001) 208 CLR 199. (2001) 208 CLR 199 at 200. or part of it, to the Australian Broadcasting Corporation (the ABC) for television broadcasting." The position of the ABC was described by Gleeson CJ82: "The [ABC] is in the business of broadcasting. ... [I]ts position is not materially different from a commercial broadcaster with whom it competes. In the ordinary course of its business it publishes information obtained from many sources, thereby contributing to the flow of information available to the public. The sources from which that information may come, directly or indirectly, cover a wide range of behaviour; some of it impeccable, some of it reprehensible, and all intermediate degrees. If the [ABC], without itself being complicit in impropriety or illegality, obtains information which it regards as newsworthy, informative, or entertaining, why should it not publish?" The question was rhetorical. The holding in Lenah Game Meats was that there existed no basis in law upon which the ABC could be enjoined from publishing the information it had received in the form of the video recording. That was so notwithstanding that the ABC "probably realised, when it received the [video recording], that it had been made in a clandestine manner" and "certainly knew that by the time the application for an injunction was heard"83. The ABC in fact incorporated segments of the video recording into a story which it broadcast on the "7.30 Report" on 4 May 1999. As described in the narrative statement of facts in the appellant's submissions in Lenah Game Meats, that story was concerned with: the harvesting, slaughter and export of Australia's wildlife; the adequacy and possible reform of the Tasmanian Animal Welfare Code of Practice for Processing Brush Tail Possum which covered the capture, handling, transport and slaughter of possums in that State; the concerns of animal liberation groups about the treatment of possums, the holding and slaughtering process of such animals, the adequacy of the Tasmanian Animal Welfare Code of Practice for Processing Brush Tail Possum and the health and safety of possum meat for consumption; (2001) 208 CLR 199 at 228 [46]. (2001) 208 CLR 199 at 214 [1]. inspections by State and Commonwealth authorities of the possum slaughtering process at Lenah Game Meats' abattoirs; the role of the Tasmanian Department of Agriculture and Fisheries and Department of Health in regulating the export of wildlife; and the views of the Tasmanian Department of Primary Industry and the Animal Welfare Advisory Committee concerning Lenah Game Meats' activities. The slaughter of animals for export is within the scope of the legislative power of the Commonwealth Parliament84. The subject-matter was regulated under Commonwealth legislation at the time of the "7.30 Report" broadcast sought unsuccessfully to be enjoined in Lenah Game Meats85, had been so regulated since at least 193586, and remains so regulated87. By force of the prohibitions now in question, the ABC or any other broadcaster, as well as Farm Transparency or any other publisher of video content, would now be prohibited from publishing or even possessing a similar video recording supplied to it in similar circumstances if it knew, whether by inference from the subject-matter of the recording or other information, that the recording was created as a result of trespass to an abattoir in New South Wales. That would be so irrespective of the significance of the subject-matter of the recording to government and political matters. Therein can be seen "the incremental effect of [the prohibitions] on the real-world ability of a person or persons to make or to receive communications which are capable of bearing on electoral choice"88. The special case alludes to other instances in recent history of video recordings – apparently showing animal cruelty and apparently created as a result 84 See O'Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565. 85 See the Export Meat Orders 1985 (Cth) and the Prescribed Goods (General) Orders 1985 (Cth) made pursuant to the Export Control (Orders) Regulations 1982 (Cth) under the Export Control Act 1982 (Cth). 86 See the Meat Export Control (Licences) Regulations (Cth) made under the Meat Export Control Act 1935 (Cth) and the Commerce (Meat Export) Regulations (Cth) made under the Customs Act 1901 (Cth), considered in O'Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565. 87 See the Export Control (Meat and Meat Products) Rules 2021 (Cth) and the Export Control (Poultry Meat and Poultry Meat Products) Rules 2021 (Cth) made under the Export Control Act 2020 (Cth). 88 Brown v Tasmania (2017) 261 CLR 328 at 386 [188]. See also at 365 [109]. of a trespass to private property – having come into the possession of a broadcaster, having been published by the broadcaster, and having stimulated national debate leading to executive inquiry and legislative change. There is no need to set out the details of those instances. They are notorious. This is not an occasion for prognostication about how the common law rules and equitable principles examined in Lenah Game Meats and found not to impede publication of the video recording in that case might develop in the future in Australia. Clear from Lange89, emphasised by Gleeson CJ in Lenah Game Meats itself90, and recognised in contemporary academic writings on the potential development of a tort of privacy in Australia91, is that any development would need itself to follow a path consistent with the constitutional guarantee of freedom of political communication. That is so for development of the substantive law demarcating those activities that will and those that will not be afforded some measure of protection against public scrutiny at common law or in equity92. That must also be so for development of the adjectival law identifying considerations that are appropriate to be weighed in determining whether or not publication or possession will be the subject of discretionary relief93. What is inconceivable is that any rule of common law or principle of equity would ever develop to the extent of prescribing and enforcing a blanket prohibition on communication or possession of any visual record known to have been created as a result of a trespass to private property irrespective of the nature of the activities revealed and irrespective of the systemic importance of electors, legislators and officers of the executive becoming aware of those activities. The point is not that conformity with the constitutional guarantee of freedom of political communication means that political communication must (1997) 189 CLR 520 at 566. See also Aid/Watch Inc v Federal Commissioner of Taxation (2010) 241 CLR 539 at 555-556 [44]-[45]. (2001) 208 CLR 199 at 219-220 [20], 224 [35]. 91 See Gligorijevic, "A Common Law Tort of Interference with Privacy for Australia: Reaffirming ABC v Lenah Game Meats" (2021) 44 University of New South Wales Law Journal 673 at 702-707; Lerch, "The Judicial Law-Making Function and a Tort of Invasion of Personal Privacy" (2021) 43 Sydney Law Review 133 at 138. 92 See now A v Hayden (1984) 156 CLR 532 at 544-545, 572; Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 at 454-456; Minister for Immigration and Citizenship v Kumar (2009) 238 CLR 448 at 456-457 [25]-[27]. 93 See now Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57 at 72- always trump privacy. The point is that conformity with the constitutional guarantee means that privacy cannot always trump political communication. Tellingly, legislative regimes which impose prohibitions on publication of visual records in order to protect the privacy of activities on private property in Victoria94, Western Australia95 and the Northern Territory96 all contain exceptions for publications judicially determined to be in the public interest. The case-by-case judicial determination of the public interest imported into those broadly comparable State and Territory legislative regimes by those exceptions operates relevantly to ensure that the public interest in protecting privacy does not prevail in circumstances where protection by prohibiting publication of an extant record of activities that occurred on private property would be disproportionate to the public interest in electors and their elected representatives becoming aware of those activities97. Those other State and Territory legislative regimes are not just illustrations of the latitude of choice available to a legislature in protecting the privacy of activities occurring on private property in a manner that conforms to the constitutionally prescribed system of government. The public interest exceptions they incorporate cannot be explained away as mere details of legislative design. The present significance of those other State and Territory legislative regimes is that they illustrate an adequacy of balance that is lacking from the blanket prohibitions imposed in New South Wales. An extant visual record of activities that in fact occurred on private property, which would be strongly or even overwhelmingly in the public interest for electors and their elected representatives to be made aware of, would be communicable if the record were of activities on private property in other States and Territories. The same extant visual record could not be knowingly communicated or even knowingly possessed if it were of activities on private property in New South Wales. Construing the prohibitions more narrowly What I have written so far explains my conclusion that, were ss 11 and 12 to operate fully and completely according to their terms in their application to a visual record that has resulted from a contravention of s 8, they would impose an unjustified burden on freedom of political communication in their application to 94 See s 11(2)(b)(i) of the Surveillance Devices Act 1999 (Vic). 95 See s 9(2)(a)(viii) and Pt 5 of the Surveillance Devices Act 1998 (WA). 96 See s 15(2)(b)(i) of the Surveillance Devices Act 2007 (NT). 97 See Hogan v Hinch (2011) 243 CLR 506 at 536-537 [31]-[32], 544 [50], 548-549 communication and possession of (at least) some visual records which depict activities properly the subject-matter of political communication. Because that is so, ss 11 and 12 infringe the constitutional guarantee of freedom of political communication in their application to a visual record that has resulted from a contravention of s 8 and cannot be valid in their entirety. The question is then as to whether, and if so how, ss 11 and 12 might be construed to have a narrower application in accordance with s 31(2) of the Interpretation Act 1987 (NSW) so as not to infringe the constitutional guarantee. The argument of the plaintiffs is that ss 11 and 12 should be construed to have no application to publication or possession of a visual record that is the subject-matter of a political communication. I accept that construction, which seems to me to involve an orthodox application of the orthodox understanding that "where a law is intended to operate in an area where Parliament's legislative power is subject to a clear limitation, it can be read as subject to that limitation"98. The Attorney-General of the Commonwealth has presented what might or might not be a different argument. The argument, which has been stated only at a high level and which has not been developed, has been couched in terms that s 31(2) of the Interpretation Act produces the result that each of ss 11 and 12 "operates to the extent that it does not impose an unjustified burden on the freedom of political communication". Given that I find myself in dissent in answering the questions asked by the parties in the special case, I propose to respond to the argument only in summary form. The argument needs to be considered against the background of what in Pidoto v Victoria99 Latham CJ described as an "interesting argument" then put on behalf of the Commonwealth. The argument was to the effect that, in the application of the materially identical provision in s 46(b) of the Acts Interpretation Act 1901 (Cth), "the function of the Court, when it finds [an enactment expressed in general terms] bad in its application to particular circumstances, is limited to declaring [the enactment] bad to that extent, the enactment being left to operate in all cases to which it can validly apply"100. The argument was rejected. 98 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 502-503. See Coleman v Power (2004) 220 CLR 1 at 55-56 [110]; Clubb v Edwards (2019) 267 CLR 171 at 221-222 [149], 290-291 [341]. (1943) 68 CLR 87 at 108. 100 (1943) 68 CLR 87 at 97. Latham CJ said that the argument appeared "to require the Court to perform a feat which is in essence legislative and not judicial"101. Section 46(b) of the Acts Interpretation Act, he pointed out, did not purport to set out "a rule of law" as to the circumstances in which an enactment expressed in general terms would have valid application but rather set out "a rule of construction" to the effect that "if an intention of Parliament that there should be a partial operation of the law based upon some particular standard criterion or test can be discovered from the terms of the law itself or from the nature of the subject matter with which the law deals, it can be read down so as to give valid operation of a partial character"102. Post- judicially, Latham CJ referred to those principles as belonging to a body of law relating "rather to the interpretation of statutes in the light of the [Acts Interpretation Act] than to the interpretation of the Constitution itself"103. To postulate that a legislative provision – the operation of which in some but not all circumstances imposes an unjustified burden on freedom of political communication – can operate to the extent that the provision does not impose an unjustified burden on the freedom of political communication, may be no more than to describe the consequence that applying an interpretation provision such as s 31(2) of the Interpretation Act or s 15A or s 46(b) of the Acts Interpretation Act will have if some standard, criterion or test can be discerned by which the legislative provision in question can be construed to have a partial operation. If that is all that is meant by the argument of the Attorney-General, I do not disagree. The conclusion to which the argument leads me is acceptance of the plaintiffs' construction of ss 11 and 12, to which I have already referred, in accordance with which the prohibitions on communication and possession, in their application to a visual record that has resulted from a contravention of s 8, are to be understood as having no application to a visual record that is the subject-matter of a political communication. If the Attorney-General's argument means instead that a legislative provision which operates in some but not all circumstances to impose an unjustified burden on freedom of political communication can be given a piecemeal operation based on a judicial assessment of whether the burden it imposes is or is not justified in its application to the particular circumstances thrown up by the facts of a particular case, I reject the argument as inconsistent 101 (1943) 68 CLR 87 at 109, quoting R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 676 (cleaned up). 102 (1943) 68 CLR 87 at 110-111. See also Re Nolan; Ex parte Young (1991) 172 CLR 103 Latham, "Interpretation of the Constitution", in Else-Mitchell (ed), Essays on the Australian Constitution, 2nd ed (1961) 1 at 46. with the reasons given by Latham CJ for rejecting the argument then put on behalf of the Commonwealth in Pidoto. The majority answers the questions asked by the parties on the basis that ss 11 and 12 can be construed in accordance with s 31(2) of the Interpretation Act more narrowly to have no application to the publication or possession of a visual record that has resulted from a contravention of s 8 in which the publisher or possessor of the record has not been complicit. Were I to consider that construction to result in ss 11 and 12 being narrowed to the extent of no longer operating to impose an unjustified burden on freedom of political communication, I would accept the construction to be consistent with Pidoto. My difficulty is that I cannot accept that narrowing the operation of ss 11 and 12, merely to the extent of excluding their application to the publication or possession of a visual record that has resulted from a contravention of s 8 in which the publisher or possessor of the record has not been complicit, would result in the prohibitions they impose achieving an adequacy of balance that is compatible with the maintenance of the system of representative and responsible government which the implied freedom of political communication exists to protect. Each section would still apply to prohibit publication or possession of a visual record that has already been brought into existence. And each would still operate irrespective of the nature of the activities revealed by that extant visual record and irrespective of the systemic importance of electors, legislators and officers of the executive being able to be made aware of those activities. My answers to the questions Each of Questions (1) and (3) asked by the parties in the special case should be answered: "In its application to a visual record that has resulted from the use of an optical surveillance device in contravention of s 8, the section imposes an unjustified burden on freedom of political communication. Otherwise the question does not arise." Each of Questions (2) and (4) should be answered: "The section must be construed to have no application to a visual record that is the subject- matter of a political communication." Question (5) should be answered: "The defendant." 106 GORDON J. The plaintiffs challenged the validity of ss 11 and 12 of the Surveillance Devices Act 2007 (NSW) as infringing the implied freedom of terms, political communication. Sections 11 and 12 prohibit, the publication and possession of material obtained as a result of the use of certain surveillance devices in contravention of Pt 2 of the Surveillance Devices Act. in broad The operation of ss 11 and 12 of the Surveillance Devices Act is predicated on a prior contravention of Pt 2 of the Surveillance Devices Act, particularly, ss 7, 8 and 9. The scope of the prohibitions, the effective burden on political communication and their justification differ depending on which of ss 7, 8 or 9 in Pt 2 engages ss 11 and 12. This is because ss 11 and 12 operate on substantially different premises depending on whether the prior contravention of Pt 2 is a breach of s 7 (installation, use or maintenance of listening devices only in relation to a "private conversation"), s 8 (installation, use or maintenance of an optical surveillance device "to record visually or observe the carrying on of an activity if the installation, use or maintenance of the device involves" entry into premises or a vehicle, or interference with a vehicle or other object, without consent), or s 9 (installation, use or maintenance of a tracking device to determine the geographical location of a person or object without consent). The second plaintiff, Mr Delforce, is an activist for animal welfare and animal rights. Mr Delforce has engaged in activity that purportedly contravenes ss 8, 11 and 12 of the Surveillance Devices Act. He intends to engage in activity that would purportedly contravene ss 11 and 12 of the Surveillance Devices Act in the future. Mr Delforce is also a director of the first plaintiff, Farm Transparency International Ltd ("Farm Transparency")104, and has a significant involvement in Farm Transparency's operations. Farm Transparency, a not-for-profit charity, was established to pursue the purpose of preventing and relieving the suffering of animals, including by raising public awareness about animal cruelty. It engages in activities including publishing photographs, videos and audio-visual recordings of animal agricultural practices in Australia. Farm Transparency has engaged in activity that purportedly contravenes ss 11 and 12 and may do so in the future. The facts stated in the Amended Special Case establish that Mr Delforce was a trespasser for the purposes of s 8 and, in purported contravention of ss 11 and 12, published the material he obtained unlawfully while he trespassed. The facts also establish that Farm Transparency is at least complicit in that trespass. As will be seen, the nature and extent of the burden on the implied freedom of political communication is different for persons, like the plaintiffs, 104 The successor entity of Aussie Farms Inc, Farm Transparency Project Inc and Dominion Movement Inc. who are trespassers or otherwise complicit in trespass, as compared with persons who have not trespassed or are not otherwise complicit. Scope of plaintiffs' challenge Questions 1 and 3 of the Amended Special Case ask the Court to consider the validity of ss 11 and 12 in all of their operations (that is, in their operations with each of ss 7 to 9). Those questions reflect the declaratory relief sought by the plaintiffs, namely that ss 11 and 12 are wholly invalid. The plaintiffs subsequently clarified that they only challenged the validity of ss 11 and 12 in their operations with ss 7 and 8. It was not in dispute that the plaintiffs have standing to challenge the validity of ss 11 and 12 of the Surveillance Devices Act. The question of standing is, however, distinct from the question as to the extent to which the Court should determine the validity of ss 11 and 12. The difficulty for the plaintiffs is that the Amended Special Case confines the scope of the plaintiffs' challenge. The Amended Special Case does not demonstrate that "there exists a state of facts which makes it necessary to decide" the validity of ss 11 and 12 of the Surveillance Devices Act in their operations with ss 7 or 9105. That requires elaboration. Prudential approach – state of facts needed to make it necessary to decide constitutional questions In Lambert v Weichelt106, Dixon CJ (on behalf of the Court) observed that "[i]t is not the practice of the Court to investigate and decide constitutional questions unless there exists a state of facts which makes it necessary to decide ... a question in order to do justice in the given case and to determine the rights of the parties". That approach (sometimes termed the "prudential approach") has been endorsed and elaborated upon by the High Court on several occasions107, including very recently. For present purposes, it is sufficient to refer to the Court's recent 105 Lambert v Weichelt (1954) 28 ALJ 282 at 283. 106 (1954) 28 ALJ 282 at 283. 107 Tajjour v New South Wales (2014) 254 CLR 508 at 587-589 [173]-[176]; Knight v Victoria (2017) 261 CLR 306 at 324-326 [32]-[37]; Clubb v Edwards (2019) 267 CLR 171 at 192-193 [32]-[36], 216-217 [135]-[138], 287-288 [329]-[332]; Zhang v Commissioner of the Australian Federal Police (2021) 95 ALJR 432 at 438 [22]-[23]; 389 ALR 363 at 368-369; Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 846-847 [56]-[60]; 393 ALR 551 at 565-566. consideration of the prudential approach in Mineralogy Pty Ltd v Western Australia108. In Mineralogy109, the plurality emphasised that the "cautious and restrained approach to answering questions agreed by the parties in a special case is a manifestation of a more general prudential approach to resolving questions of constitutional validity 'founded on the same basal understanding of the nature of the judicial function as that which has informed the doctrine that the High Court lacks original or appellate jurisdiction to answer any question of law (including but not confined to a question of constitutional law) if that question is divorced from the administration of the law'". The plurality stated that "[u]nderlying the prudential approach is recognition that the function performed by the Full Court in answering a question of law stated for its opinion is not advisory but adjudicative. Underlying it also is recognition that performance of an adjudicative function in an adversary setting 'proceeds best when it proceeds if, and no further than is, warranted to determine a legal right or legal liability in controversy'"110. The plurality went on to identify four "implications of the prudential approach"111: first, "a party will not be permitted to 'roam at large' but will be confined to advancing those grounds of challenge which bear on the validity of the provision in its application to that party"; second, "it is ordinarily inappropriate for the [Full] Court to be drawn into a consideration of whether a legislative provision would have an invalid operation in circumstances which have not arisen and which may never arise if the provision, if invalid in that operation, would be severable and otherwise valid"; third, "the application of an impugned legislative provision to the facts must appear from the special case with sufficient clarity both to identify the right, duty or liability that is in controversy and to demonstrate the necessity of answering the question of law to the judicial resolution of that controversy"; and, fourth, "the necessity of answering the question of law to the judicial resolution of the controversy may not sufficiently appear where there remains a prospect that the controversy can be judicially determined on another basis". Thus, although the plaintiffs have standing, that does not mean they are permitted to "roam at large" over the impugned provisions112. They are confined to advancing grounds of challenge which bear on the validity of the impugned 108 (2021) 95 ALJR 832; 393 ALR 551. 109 (2021) 95 ALJR 832 at 846 [57]; 393 ALR 551 at 565. 110 Mineralogy (2021) 95 ALJR 832 at 846 [58]; 393 ALR 551 at 566. 111 Mineralogy (2021) 95 ALJR 832 at 847 [59]-[60]; 393 ALR 551 at 566. 112 Knight (2017) 261 CLR 306 at 324-325 [33]. provisions in their application to them. More particularly, they are confined by the factual basis they have agreed to in the Amended Special Case. There is no dispute between the parties or interveners that it is appropriate for this Court to determine whether ss 11 and 12, in their operations with s 8, are invalid. Section 8(1) prohibits the installation, use or maintenance of an optical surveillance device on premises, vehicles or objects to "record visually" or "observe" the carrying on of an activity in certain circumstances. But there is nothing in the Amended Special Case to suggest that the plaintiffs' rights and liabilities are, or will be, affected by ss 11 and 12 in their operations with ss 7 or None of the facts stated in the Amended Special Case expressly refer to or address any activity that has amounted (or will amount) to a contravention of ss 7 or 9 and is capable of providing the foundation for an offence against ss 11 or 12. And it is not possible to draw any inference from the facts stated in the Amended Special Case as to the potential engagement of ss 11 or 12 in respect of a contravention of ss 7 or 9; there is simply nothing that addresses the use of listening devices in respect of private conversations or the use of a tracking device to ascertain a person's geographical location. The plaintiffs have not established that "there exists a state of facts which makes it necessary to decide [the validity of ss 11 and 12 in their operations with ss 7 or 9] in order to do justice in the ... case and to determine the rights of the parties"113. Applying the prudential approach, this Court ought to determine the constitutional validity of ss 11 and 12 only in their operations with s 8. Validity Sections 11 and 12 of the Surveillance Devices Act, in their operations with s 8, as a general rule, are invalid to the extent that they place an unjustified burden on communication on governmental or political matters, namely on such communication by persons who do not themselves contravene s 8 and are not complicit in such a contravention where the underlying information is not otherwise confidential. It is a general rule because there may be circumstances where other relief might go. Cases of that kind were not identified or the subject of argument. Subject to contrary statutory intention114, s 31 of the Interpretation Act 1987 (NSW) reverses the presumption that the Surveillance Devices Act is to operate as a whole, so that the intention of the legislature is to be taken, prima facie, to be 113 Lambert (1954) 28 ALJ 282 at 283. 114 Interpretation Act 1987 (NSW), s 5(2). that the Surveillance Devices Act should be divisible and that any parts found constitutionally unobjectionable should be carried into effect independently of those which fail115. No contrary intention is found in ss 11 and 12 or in the broader context of the Surveillance Devices Act. There is nothing in the Surveillance Devices Act to manifest an intention that ss 11 and 12 should be wholly invalid if they cannot apply in respect of persons, subject matters or circumstances to which they would otherwise have been construed as applicable116. To the extent that ss 11 and 12, in their operations with s 8, impermissibly infringe the implied freedom, then, pursuant to s 31 of the Interpretation Act, they can be read down to give the provisions a "partial but constitutionally valid operation"117. Sections 11 and 12, in their operations with s 8, should be read down as having no application to the extent that the provisions place an unjustified burden on communication on governmental or political matters. It would not be necessary, and indeed it would be inappropriate, to read ss 11 and 12 as not applying to governmental or political matters generally. To explain the structure of these reasons, three points should be made at the outset. First, the critical starting point is the legal effect and practical operation of ss 11 and 12, in their operations with s 8. That is a question of statutory construction. Second, the purpose, legal effect and practical operation of the sections can properly be determined only by detailed reference to the wider legal context. Third, the wider legal context includes the existing common law, equity and statute. It is in that wider legal context that ss 11 and 12 have legal effect and practical operation. That analysis identifies the nature and extent of the incremental burden that the sections impose on the implied freedom of political communication. It establishes that the nature and extent of the incremental burden is not uniform. Surveillance Devices Act Although the provisions of the Surveillance Devices Act are set out in other reasons, it is necessary for the development of these reasons to restate important parts of the Act. 115 Tajjour (2014) 254 CLR 508 at 585-586 [169]; Clubb (2019) 267 CLR 171 at 116 Interpretation Act, s 5(2); Tajjour (2014) 254 CLR 508 at 585 [169]; Knight (2017) 261 CLR 306 at 325-326 [35]-[36]; Clubb (2019) 267 CLR 171 at 291 [342], 117 cf Clubb (2019) 267 CLR 171 at 288 [334]; see also 289 [337]. Long title and objects The long title of the Surveillance Devices Act, relevantly, is: "An Act to regulate the installation, use, maintenance and retrieval of surveillance devices ... and for other purposes". The express objects of the Act118 are: to provide law enforcement agencies with a comprehensive framework for the use of surveillance devices in criminal investigations, and to enable law enforcement agencies to covertly gather evidence for the purposes of criminal prosecutions, and to ensure that the privacy of individuals is not unnecessarily impinged upon by providing strict requirements around the installation, use and maintenance of surveillance devices." (emphasis added) Structure of Surveillance Devices Act The Surveillance Devices Act deals with a range of subjects, including: regulation of the installation, use and maintenance of surveillance devices, involving the prohibition of identified conduct (Pt 2); warrants for the installation, use and maintenance of surveillance devices (Pt 3); recognition of warrants and other authorisations in relation to surveillance devices issued by other Australian polities (Pt 4); and compliance, enforcement and administration (Pts 5 and 6). These proceedings are concerned particularly with Pt 2. Part 2 – prohibitions on installation, use and maintenance of surveillance devices Part 2, headed "Regulation of installation, use and maintenance of surveillance devices", contains a number of prohibitions relating to the installation, use and maintenance of various surveillance devices. This proceeding involves a challenge to the validity of the prohibitions in ss 11 and 12. It is, however, necessary to place those provisions within the broader statutory framework established by the Surveillance Devices Act. This is particularly important because, as has been stated, ss 11 and 12 are engaged only in circumstances involving certain contraventions of other provisions of Pt 2119. For present purposes, it is sufficient to consider s 8. 118 Surveillance Devices Act, s 2A. 119 The note under the heading to Pt 2 states that offences in Pt 2 "must be dealt with on indictment". See also Criminal Procedure Act 1986 (NSW), s 5(1). Section 8 – prohibition on installation, use and maintenance of optical surveillance devices without consent Section 8(1) prohibits the installation, use and maintenance of optical surveillance devices without consent120. It provides: "A person must not knowingly install, use or maintain an optical surveillance device on or within premises or a vehicle or on any other object, to record visually or observe the carrying on of an activity if the installation, use or maintenance of the device involves – entry onto or into the premises or vehicle without the express or implied consent of the owner or occupier of the premises or vehicle, interference with the vehicle or other object without the express or implied consent of the person having lawful possession or lawful control of the vehicle or object." "[O]ptical surveillance device" is defined to mean "any device capable of being used to record visually or observe an activity, but ... not includ[ing] spectacles, contact lenses or a similar device used by a person with impaired sight to overcome that impairment"121. "[P]remises" is defined to include "(a) land, (b) a building, (c) a part of a building, [and] (d) any place, whether built on or not"122. "[A]ctivity" and "carrying on of an activity" are not defined in the Surveillance Devices Act. Section 8 therefore prohibits knowingly installing, using or maintaining an optical surveillance device on or within premises or a vehicle or on any object to record visually or observe "the carrying on of an activity", where it involves (a) entry onto or into premises or a vehicle without the express or implied consent of the owner or occupier; or (b) interference with a vehicle or object without the express or implied consent of the person with lawful possession or control of the vehicle or object. In general terms, s 8(1) prohibits installing, using or maintaining an optical surveillance device whilst trespassing or interfering with property without consent. But it is equally important to identify what s 8(1) does not prohibit. First, ss 8(2) and 8(2A) identify exceptions to the prohibition in s 8(1). Section 8(1) does 120 The maximum penalty for a breach of s 8(1) is 500 penalty units for a corporation or 100 penalty units or five years' imprisonment, or both, in any other case. 121 Surveillance Devices Act, s 4(1) definition of "optical surveillance device". 122 Surveillance Devices Act, s 4(1) definition of "premises". not apply to, among other things, "the installation, use or maintenance of an optical surveillance device in accordance with a warrant, emergency authorisation, corresponding warrant or corresponding emergency authorisation"123 or "in accordance with a law of the Commonwealth"124. It also does not apply to use by certain law enforcement officers in specified circumstances125. Second, s 8 of the Surveillance Devices Act does not engage with, and has no application to, the installation, use or maintenance of an optical surveillance device by any person, including an employee, who is not a trespasser or is not interfering with an object or vehicle. Sections 11 and 12 are not engaged and have nothing to say about those activities not caught by a contravention of Pt 2 of the Surveillance Devices Act, relevantly here, s 8. Sections 11 and 12 Section 11 is headed "Prohibition on communication or publication of private conversations or recordings of activities". Section 11(1) provides126: "A person must not publish, or communicate to any person, a private conversation or a record of the carrying on of an activity, or a report of a private conversation or carrying on of an activity, that has come to the person's knowledge as a direct or indirect result of the use of a listening device, an optical surveillance device or a tracking device in contravention of a provision of [Pt 2]." (emphasis added) "[R]ecord" includes "(a) an audio, visual or audio visual record, (b) a record in digital form, [and] (c) a documentary record prepared from a record referred to in paragraph (a) or (b)"127. "[R]eport", in relation to a conversation or activity, "includes a report of the substance, meaning or purport of the conversation or activity"128. 123 Surveillance Devices Act, s 8(2)(a). 124 Surveillance Devices Act, s 8(2)(b). 125 Surveillance Devices Act, ss 8(2)(d), 8(2)(d1), 8(2)(e), 8(2)(f), 8(2A). 126 The maximum penalty for a breach of s 11(1) is 500 penalty units for a corporation or 100 penalty units or five years' imprisonment, or both, in any other case. 127 Surveillance Devices Act, s 4(1) definition of "record". 128 Surveillance Devices Act, s 4(1) definition of "report". Section 11(2) provides that s 11(1) does not apply to the following: if the communication or publication is made – to a party to the private conversation or activity, or (ii) with the consent, express or implied, of all the principal parties to the private conversation or activity, or (iii) for the purpose of investigating or prosecuting an offence against this section, or in the course of proceedings for an offence against this Act or the regulations, if the communication or publication is no more than is reasonably necessary in connection with an imminent threat of – serious violence to persons or of substantial damage to property, or commission of a serious narcotics offence." Section 11(3) then provides that "[a] person who obtains knowledge of a private conversation or activity in a manner that does not involve a contravention of a provision of [Pt 2] is not prevented from communicating or publishing the knowledge so obtained even if the same knowledge was also obtained in a manner that contravened [Pt 2]". Section 12 is headed "Possession of record of private conversation or activity". Section 12(1) provides129: "A person must not possess a record of a private conversation or the carrying on of an activity knowing that it has been obtained, directly or indirectly, by the use of a listening device, optical surveillance device or tracking device in contravention of [Pt 2]." (emphasis added) Section 12(2) provides that s 12(1) does not apply, relevantly, where the record is in the possession of the person "in connection with proceedings for an offence against [the] Act or [its] regulations"130; "with the consent, express or 129 The maximum penalty for a breach of s 12(1) is 500 penalty units for a corporation or 100 penalty units or five years' imprisonment, or both, in any other case. 130 Surveillance Devices Act, s 12(2)(a). implied, of all of the ... persons who took part in the activity"131; or "as a consequence of a communication or publication of that record to that person in circumstances that do not constitute a contravention of [Pt 2]"132. Proper approach to construction of ss 11 and 12 As with any question of constitutional validity, before determining the validity of ss 11 and 12 of the Surveillance Devices Act, it is necessary to identify their proper construction133. Sections 11 and 12 are offence provisions, which are to be construed in accordance with the ordinary rules of statutory construction134. The proper construction of ss 11 and 12 is, therefore, "to be found in the meaning of the statutory language, read in its statutory context and in light of its statutory purpose"135. When construing an offence provision, the provision must be read in the light of the "general principles of criminal responsibility", although the language of the statute is ultimately controlling136. Relevantly for present purposes, there is a common law presumption that "mens rea" (a fault or mental element) is an essential ingredient in every statutory offence137. That presumption may be displaced by the statute. It is not displaced here. 131 Surveillance Devices Act, s 12(2)(b). 132 Surveillance Devices Act, s 12(2)(c). 133 LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 519 [125]; 391 ALR 188 at 220, citing Fairfax v Federal Commissioner of Taxation (1965) 114 CLR 1 at 7, Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 498-499 [53], Coleman v Power (2004) 220 CLR 1 at 21 [3], 68 [158], Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11], North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at 581 [11] and Brown v Tasmania (2017) 261 CLR 328 at 428 [307], 134 Aubrey v The Queen (2017) 260 CLR 305 at 325-326 [39]. 135 North Australian Aboriginal Justice Agency (2015) 256 CLR 569 at 605 [81]; see also 581 [11]. 136 CTM v The Queen (2008) 236 CLR 440 at 446 [5]; see also 483-484 [148]. 137 He Kaw Teh v The Queen (1985) 157 CLR 523 at 528-529, 530, 565-568, 582, 590-591. See also Sherras v De Rutzen [1895] 1 QB 918 at 921; Lim Chin Aik v The Queen [1963] AC 160 at 173; Warner v Metropolitan Police Commissioner [1969] In identifying the applicable mental element, Brennan J explained in He Kaw Teh v The Queen138 that "[t]here is a presumption that in every statutory offence, it is implied as an element of the offence that the person who commits the actus reus does the physical act defined in the offence voluntarily and with the intention of doing an act of the defined kind" (emphasis added). The mental element for a physical act is intention. Next, Brennan J explained that139: "[t]here is a further presumption in relation to the external elements of a statutory offence that are circumstances attendant on the doing of the physical act involved. It is implied as an element of the offence that, at the time when the person who commits the actus reus does the physical act involved, he either – (a) knows the circumstances which make the doing of that act an offence; or (b) does not believe honestly and on reasonable grounds that the circumstances which are attendant on the doing of that act are such as to make the doing of that act innocent." (emphasis added) Whether the applicable state of mind is knowledge or absence of exculpatory belief depends on the nature of the offence and which state of mind "is more consonant with the fulfilment of the purpose of the statute"140. But, ordinarily the presumption at common law141 is that the accused had knowledge of the circumstance which makes doing the act an offence. As Brennan J explained in He Kaw Teh142: "However grave the mischief at which a statute is aimed may be, the presumption is that the statute does not impose criminal liability without mens rea unless the purpose of the statute is not merely to deter a person from engaging in prohibited conduct but to compel him to take preventive 2 AC 256 at 272; Cameron v Holt (1980) 142 CLR 342 at 346, 348; Gammon (Hong Kong) Ltd v Attorney-General of Hong Kong [1985] AC 1 at 12-13; CTM (2008) 236 CLR 440 at 483-484 [148]; Ross on Crime, 9th ed (2022) at 1124 [13.2320]. 138 (1985) 157 CLR 523 at 582; see also 570. See also Director of Public Prosecutions Reference No 1 of 2004 (2005) 12 VR 299 at 302 [8]. 139 He Kaw Teh (1985) 157 CLR 523 at 582. 140 He Kaw Teh (1985) 157 CLR 523 at 582. 141 cf Criminal Code (Cth), s 5.6(2), which makes "recklessness" the default fault element for a circumstance. 142 (1985) 157 CLR 523 at 567. measures to avoid the possibility that, without deliberate conduct on his part, the external elements of the offence might occur. A statute is not so construed unless effective precautions can be taken to avoid the possibility of the occurrence of the external elements of the offence." Brennan J added that "[t]he requirement of mens rea is at once a reflection of the purpose of the statute and a humane protection for persons who unwittingly engage in prohibited conduct"143. Proper construction of ss 11 and 12 – legal effect and practical operation Consistently with established authority, and contrary to the position adopted in their written submissions, the plaintiffs accepted in oral argument that s 11 has mental elements. Indeed, Parliament is unlikely to have created an offence of absolute liability punishable by five years' imprisonment144. It was not in dispute that s 12 contains a mental element. Section 11 Section 11 has two "external" elements: relevantly, (1) the physical act of publishing or communicating to any person "a private conversation or a record of the carrying on of an activity, or a report of a private conversation or carrying on of an activity" and (2) the attendant circumstance that the matter published or communicated came to the accused's knowledge "as a direct or indirect result of the use of", relevantly, an optical surveillance device in contravention of s 8. Section 11(1) does not explicitly exclude a mental element for either element. Applying the principles identified above, absent express words or necessary implication, s 11(1) must be presumed to imply mental elements in respect of both external elements: the physical act of publishing or communicating must be accompanied by an intention to do that physical act; and the attendant circumstance – that the matter published or communicated came to the accused's knowledge as a direct or indirect result of the use of identified surveillance devices in contravention of s 8 – has a fault element of knowledge. Section 12 There is only one external element of the s 12(1) offence, namely: possessing "a record of a private conversation or the carrying on of an activity". As the Attorney-General of the Commonwealth submitted, the concept of "possession" imports a requirement that the accused had some awareness that the 143 He Kaw Teh (1985) 157 CLR 523 at 568. 144 He Kaw Teh (1985) 157 CLR 523 at 530. record was within the accused's custody or control145. The fault element accompanying that external element is expressly identified in s 12(1) as knowledge that the record was "obtained, directly or indirectly, by the use of", relevantly, an optical surveillance device in contravention of s 8. Two points should be noted about the construction of s 12. First, as the plaintiffs submitted, a person could come into possession of a record not knowing at the time of taking possession that the record was obtained in contravention of s 8. That would not be a breach of s 12(1). But if they later learn that the record was obtained unlawfully, they will commit an offence under s 12(1) at that point. Second, in effect, s 12 operates to criminalise the knowing possession of unlawfully obtained surveillance material by any person, including a would-be publisher. Matters common to ss 11 and 12 Some other matters common to both ss 11 and 12 should also be noted. First, ss 11 and 12 apply generally to a "person", defined to include "an individual, a corporation and a body corporate or politic"146. Second, while ss 11 and 12 prohibit the publication, communication or possession of "a record of a private conversation" or "the carrying on of an activity" (emphasis added), there is no requirement that the "activity" be a "private" activity. Third, ss 11 and 12 extend, relevantly, to a record obtained147, or (in respect of s 11) a report that has come to a person's knowledge148, as a direct or indirect result of the use of an optical surveillance device. This makes it clear that the use of intermediaries does not absolve a person who ultimately publishes or communicates or possesses a record or report. Sections 11 and 12 capture persons who have trespassed as well as those complicit in trespass and prohibits them from publishing and possessing material that they themselves obtained (or were somehow complicit in obtaining) in contravention of s 8. The fault elements of ss 11 and 12 will always be satisfied in respect of those persons. But they also capture other persons – third parties who had no involvement in the trespass, but who have knowledge that the information was obtained in contravention of s 8. In addition to the statutory carve-outs in ss 11 and 12 (as well as s 8) to which reference has already been made, ss 11 and 12 do not apply to information 145 He Kaw Teh (1985) 157 CLR 523 at 537-539, 589, 599. 146 Interpretation Act, s 21(1) definition of "person". 147 Surveillance Devices Act, ss 11(1) and 12(1). 148 Surveillance Devices Act, s 11(1). already in the public domain149, although the exception is in different terms in ss 11(3) and 12(2)(c). Implied freedom of political communication The implied freedom of political communication is a constitutional implication arising from ss 7, 24, 62, 64 and 128 of the Constitution. It may be conveniently described as follows150: "[It] is an indispensable incident of the system of representative and responsible government which the Constitution creates and requires. The freedom is implied because ss 7, 24 and 128 of the Constitution (with Ch II, including ss 62 and 64) create a system of representative and responsible government. It is an indispensable incident of that system because that system requires that electors be able to exercise a free and informed choice when choosing their representatives, and, for them to be able to do so, there must be a free flow of political communication within the federation. For that choice to be exercised effectively, the free flow of political communication must be between electors and representatives and 'between all persons, groups and other bodies in the community'. The implied freedom operates as a constraint on legislative and executive power. It is a freedom from government action, not a grant of individual rights. The freedom that the Constitution protects is not absolute. The limit on legislative and executive power is not absolute. The implied freedom does not protect all forms of political communication at all times and in all circumstances. And the freedom is not freedom from all regulation or restraint. Because the freedom exists only as an incident of the system of representative and the Constitution, the freedom limits legislative and executive power only to the extent necessary for the effective operation of that system." responsible government provided for by The applicable principles are well established. Whether the impugned provisions are invalid for impermissibly burdening the implied freedom falls to be assessed by reference to the following questions151: Do the impugned provisions 149 Surveillance Devices Act, ss 11(3) and 12(2)(c). 150 Brown (2017) 261 CLR 328 at 430 [312]-[313] (footnotes omitted). See also LibertyWorks (2021) 95 ALJR 490 at 520 [131]; 391 ALR 188 at 222. 151 See the test identified in Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562, 567-568, as modified and refined in Coleman (2004) 220 CLR 1 at 50 [93], 51 [95]-[96], McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2] and Brown (2017) 261 CLR 328 at 359 [88], 363-364 [104], 375-376 effectively burden the freedom of political communication? Is the purpose of the impugned provisions legitimate, in the sense that it is consistent with the maintenance of the constitutionally prescribed system of government? Are the impugned provisions reasonably appropriate and adapted to advance that purpose in a manner consistent with the maintenance of the constitutionally prescribed system of government? If the first question is answered "yes", and the second or third question is answered "no", the impugned provisions will impermissibly burden the implied freedom and therefore be invalid. First question – effective burden? The first question – whether the impugned provisions effectively burden the implied freedom in their terms, operation or effect – requires consideration of how the law "affects the freedom generally"152, although the burden in a specific case may provide a useful example of a law's practical effect153. A law will effectively burden the freedom of political communication if "the effect of the law is to prohibit, or put some limitation on, the making or the content of political communications"154. Nature and extent of burden There was no dispute between the parties or interveners (other than the Attorney-General for Western Australia) that ss 11 and 12 impose an effective burden on political communication. It is, however, appropriate to consider the nature and extent of the burden by reference to the legal effect and practical operation of ss 11 and 12 in the wider legal context before considering whether the burden is justified, as this "serves to focus and to calibrate the inquiry" as to whether the provisions are reasonably appropriate and adapted155. [156], 398 [236], 413 [271], 416-417 [277]-[278], 432-433 [319]-[325]. See also LibertyWorks (2021) 95 ALJR 490 at 503-504 [44]-[46], 512 [93], 520-521 [131]-[134]; 391 ALR 188 at 199-200, 210-211, 222-223. 152 Unions NSW v New South Wales (2013) 252 CLR 530 at 553 [35]. 153 Brown (2017) 261 CLR 328 at 360 [90]. 154 Monis v The Queen (2013) 249 CLR 92 at 142 [108]. See also Comcare v Banerji (2019) 267 CLR 373 at 395 [20]; LibertyWorks (2021) 95 ALJR 490 at 521 [136]; 391 ALR 188 at 223-224. 155 Tajjour (2014) 254 CLR 508 at 579 [147]. See also LibertyWorks (2021) 95 ALJR 490 at 512 [94]; 391 ALR 188 at 211. The burden imposed by ss 11 and 12 is "indirect": s 11 is not in terms directed to communications or publications about governmental or political matters. It is facially neutral. Section 12 is further removed. It is not directed to communications; it relevantly prohibits possession of material obtained in contravention of s 8. the incremental burden requires There was no dispute that the effective burden imposed by ss 11 and 12 must be assessed in light of the burden already placed upon political justification156. communication – only The plaintiffs did not suggest that any existing common law or equitable restrictions – what might be described as "general law" restrictions – must be modified or qualified to conform with the Constitution or that any existing statutory restrictions or offences are invalid for impermissibly infringing the implied freedom. They did not challenge ss 7, 8 or 9 of the Surveillance Devices Act. As will be seen, the nature and extent of the burden is quite different for those who are trespassers (or complicit in the trespass) and others. Wider legal context At general law, a person is prohibited from publishing confidential information where they know or ought to know that the information is confidential157, regardless of whether they themselves received the information in confidence158. Confidential information "extends to information as to ... personal affairs and private life"159, but not everything that happens on private property, 156 Brown (2017) 261 CLR 328 at 365 [109], 383 [181], 384 [186], 385-386 [188], [557]-[558], 506 [563]; Banerji (2019) 267 CLR 373 at 420 [89]. 157 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 225 [39]. See also Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] (1984) 156 CLR 414 at 438 (referring to breach of confidence lying "in the notion of an obligation of conscience arising from the circumstances in or through which the information was communicated or obtained"); Wheatley v Bell [1982] 2 NSWLR 544 at 548; Minister for Mineral Resources v Newcastle Newspapers Pty Ltd (1997) 40 IPR 403 at 405; Retractable Technologies v Occupational and Medical Innovations (2007) 72 IPR 58 at 74 [61], 77-81 [68]-[86]; Dal Pont, Law of Confidentiality, 2nd ed (2020) at 287-288 [14.4]-[14.5]; cf Attorney-General v Observer Ltd [1990] 1 AC 109 at 281. 158 Johns v Australian Securities Commission (1993) 178 CLR 408 at 460; Breen v Williams (1996) 186 CLR 71 at 129; Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 567. 159 Breen (1996) 186 CLR 71 at 128. and which the owner of the land would prefer to be unobserved, is private, and thus confidential, in the necessary sense160. The protection afforded to personal affairs and private life has been said to be based on "respect for human autonomy and dignity"161. It follows from what has been said that if a person does not know, and there is no reason why they ought to know, that information is confidential, they are not prohibited from publishing it162. In addition, a person is not prohibited from publishing information about conduct that is itself unlawful. As was said in Smethurst v Commissioner of the Australian Federal Police163, "there is 'no confidence as to the disclosure of iniquity'"; "information as to crimes, wrongs and misdeeds ... lacks ... 'the necessary quality of confidence'"164 and as such "prevent[s] one of the constituent elements of the action for breach of confidence from being established"165. The position is no different where confidential information is "improperly or surreptitiously obtained"166, as opposed to "imparted in circumstances importing an obligation of confidence"167. First, it must be recalled, as Gummow J explained in Smith Kline & French Laboratories (Aust) Ltd v Department of Community Services and Health168, that: 160 Lenah Game Meats (2001) 208 CLR 199 at 227 [43]. 161 OBG Ltd v Allan [2008] AC 1 at 77 [275]. See also Campbell v MGN Ltd [2004] 2 AC 457 at 472-473 [50]-[51]; Clubb (2019) 267 CLR 171 at 195-196 [49]. 162 Wheatley [1982] 2 NSWLR 544 at 548; Newcastle Newspapers (1997) 40 IPR 403 at 405; cf Observer [1990] 1 AC 109 at 281. 163 (2020) 94 ALJR 502 at 528 [99], 565 [272]; 376 ALR 575 at 599, 647, quoting Gartside v Outram (1856) 26 LJ Ch 113 at 114. 164 Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 at 165 Dal Pont, Equity and Trusts in Australia, 7th ed (2019) at 201 [6.290]. 166 The Commonwealth v John Fairfax & Sons Ltd (1980) 147 CLR 39 at 50, quoting Lord Ashburton v Pape [1913] 2 Ch 469 at 475. 167 Coco v A N Clark (Engineers) Ltd [1969] RPC 41 at 47. 168 (1990) 22 FCR 73 at 86. "confidential information improperly or surreptitiously obtained, on the one hand, and information imparted in confidence, on the other, are treated as two species of the same genus". Second, the fact that information is obtained surreptitiously may indicate that the information was confidential and known to be so169. Third, third parties – persons who come by confidential information170 obtained by another person, including by unlawful means, such as trespass – are also prohibited from publishing the confidential information if they know, or ought to know, the manner in which it was obtained171. As Gaudron J stated, "[i]t has been held, both in Australia and in the United Kingdom, that a third person who comes by information innocently may be restrained from making use of it once he or she learns that it was obtained in circumstances involving a breach of confidence"172. A further, separate, limitation exists where the person sought to be restrained is a trespasser. Section 8(1) of the Surveillance Devices Act, which the plaintiffs did not challenge, prohibits the trespass. In such a case, equity may "intervene in aid of [the] right not to suffer a trespass" and "to address harm flowing from the trespass"173. Relief against a trespasser, whose trespass here is a criminal offence, as distinct from a third party who knows of but is not complicit in the trespass, does not depend on identifying confidential information174. The failure of the plaintiffs to challenge s 8 is important. As we have seen, ss 11 and 12 do not prohibit a person publishing or possessing information obtained by or from a person who is not a trespasser, such as an employee. That is 169 Ashcoast Pty Ltd v Whillans [2000] 2 Qd R 1 at 6. 170 This may include "[a] photographic image, illegally or improperly or surreptitiously obtained, where what is depicted is private": Lenah Game Meats (2001) 208 CLR 171 Lenah Game Meats (2001) 208 CLR 199 at 225 [39]; see also 224 [34]-[35]. 172 Johns (1993) 178 CLR 408 at 460. See also Breen (1996) 186 CLR 71 at 129; Propend Finance (1997) 188 CLR 501 at 567; Director of Public Prosecutions (Cth) v Kane (1997) 140 FLR 468 at 473-474. 173 Smethurst (2020) 94 ALJR 502 at 549 [196]; 376 ALR 575 at 626. 174 cf Lenah Game Meats (2001) 208 CLR 199, which did not concern relief against a trespasser but concerned only relief against a third party, the Australian Broadcasting Corporation. unsurprising given the wider legal context175. And ss 11 and 12 do not prohibit a person standing outside a property and recording conduct taking place on a property. The sections also do not prohibit a person publishing or possessing information in the public domain. Incremental burden in general terms The incremental burden imposed by s 11 is that it prohibits a publisher, not involved in the unlawful taking of information that bears upon governmental or political matters, but who has knowledge that the information was obtained by trespass, from publishing or communicating a record or report of the carrying on of an activity, where the underlying information is not otherwise confidential176. As the Attorney-General of the Commonwealth submitted, the incremental burden on the implied freedom is in respect of information obtained as a product of trespass that bears upon governmental or political matters and which, even though occurring on private property, is not private in the relevant sense necessary to be protected at general law. Sections 11 and 12, in their operations with s 8, also prohibit the possession and publication of material which itself reveals unlawful conduct, the publication of which would be unlikely to be restrained under general law. Nature and extent of incremental burden varies As will be evident, the incremental burden differs between, on the one hand, trespassers and those complicit in (or party to) the trespass, and on the other, third parties. Indeed, senior counsel for the plaintiffs accepted in oral argument that there might be a difference in relation to the incremental burden in respect of a trespasser and the "mere recipient" of information. Trespassers and those complicit in the trespass In respect of trespassers and those complicit in (or party to) the trespass by which the information is obtained, ss 11 and 12 impose an indirect and not insubstantial incremental burden above that which is imposed on them by a combination of the prohibition in s 8 preventing them from obtaining the material in the first instance (which was not challenged by plaintiffs) and the general law. Put in different terms, the indirect and not insubstantial incremental burden on the freedom to communicate on governmental or political matters for trespassers and 175 See, eg, Corporations Act 2001 (Cth), Pt 9.4AAA; Public Interest Disclosures Act 1994 (NSW). 176 Or a breach of copyright. See Lenah Game Meats (2001) 208 CLR 199 at 246-247 [102]-[103]. See also Smethurst (2020) 94 ALJR 502 at 526 [84]; 376 ALR 575 at those complicit in (or party to) the trespass, such as the plaintiffs, is, generally speaking, limited to, first, situations where they are able to meet an application for an injunction to restrain publication on the grounds that damages would be an adequate remedy, because absent that situation an injunction will likely issue177, and, second, situations where the material reveals unlawful conduct178. As to the nature of the burden in respect of such persons, it is significant that the burden relates only to the possession and communication of the product of unlawful conduct (trespass) by those directly involved in or complicit in that conduct. Third-party publishers – innocent recipients The position of third parties – innocent recipients of the unlawfully obtained information – is different. The incremental burden on the implied freedom for them is different in its nature and its extent. Where the underlying information was obtained by trespass, and the third party knows it was obtained by trespass but was not complicit in that unlawfulness, ss 11 and 12 prohibit that third-party publisher from communicating or possessing any aspect of that information which concerns governmental or political matters179. That incremental burden, over and above the general law, is indirect but significant. Second question – legitimate purpose? Section 2A of the Surveillance Devices Act has been set out. Relevantly, it states that one of the purposes of the Act is "to ensure that the privacy of individuals is not unnecessarily impinged upon by providing strict requirements around the installation, use and maintenance of surveillance devices"180. That purpose is directly pursued in s 8. The privacy of the individual which is sought to be protected extends to what goes on within the premises of that 177 Smethurst (2020) 94 ALJR 502 at 549 [196]; 376 ALR 575 at 626. See also Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148 at 153; Richardson v Forestry Commission (1987) 164 CLR 261 at 274-276. 178 Smethurst (2020) 94 ALJR 502 at 528 [99], 565 [272]; 376 ALR 575 at 599, 647, quoting Gartside (1856) 26 LJ Ch 113 at 114. See also Corrs Pavey Whiting & Byrne (1987) 14 FCR 434 at 456; Dal Pont, Equity and Trusts in Australia, 7th ed 179 cf Defamation Act 2005 (NSW), s 29A (recognising, in a different context, that there may be a public interest in the publication of matters otherwise subject to a prohibition on publication). See also New South Wales, Defamation Amendment Bill 2020, Explanatory Note at 10. 180 Surveillance Devices Act, s 2A(c). individual or affects the reputation or esteem in which individuals connected to the premises might be held. But s 2A(c) is a general objects clause. It assists, but is not determinative, in identifying the purpose of every provision in the Surveillance Devices Act181. The purpose of s 8 is not limited to protecting the privacy of individuals. It prohibits trespass on or in premises or vehicles involving optical surveillance devices, in order to protect against interference with property. Section 8 has dual, legitimate purposes which necessarily intersect – protection of privacy and dignity and protection of property rights. Those dual purposes are broader than s 2A(c) but are not inconsistent with it. Sections 11 and 12 further the purposes of s 8. Whereas s 8 focuses on trespass, ss 11 and 12 focus on the consequences of trespass. There is no disconnect between s 8 and ss 11 and 12. Section 11 operates as a statutory injunction against the use of the fruits of trespass, recognising that to publicise material obtained through trespass furthers the harm to privacy and property recognised by s 8. Section 12 prohibits possession of the fruits of trespass. The dual purposes of ss 11 and 12, like s 8, are protection of privacy and dignity and protection of property rights. Those purposes are legitimate. Contrary to the plaintiffs' submissions, it is no purpose of ss 11 and 12 to disincentivise farm trespass. That elides the purpose and effect of ss 11 and 12182. Third question – justified? In addressing the third question – whether the impugned provisions are reasonably appropriate and adapted to advance the legitimate objects of the law – the "three-part test" of suitability, necessity and adequacy, applied by the plurality in McCloy v New South Wales183, is a tool of analysis that may be of assistance. It is not always (and it is not in this case) necessary or appropriate to undertake all steps of that analysis184. It is for the government party defending the validity of a law (here, the State of New South Wales) to demonstrate that the burden is justified, including by 181 Unions NSW v New South Wales (2019) 264 CLR 595 at 657 [172]. 182 cf McCloy (2015) 257 CLR 178 at 205 [40]; Brown (2017) 261 CLR 328 at 362 [100], 432-433 [322]; Unions NSW (2019) 264 CLR 595 at 661 [179]; Clubb (2019) 267 CLR 171 at 260 [257]. 183 (2015) 257 CLR 178 at 213 [68], 215 [72], 216 [77], 217 [79]. 184 Brown (2017) 261 CLR 328 at 376 [158]-[159], 378 [163], 417 [279]-[280], 464 [426]-[429], 476-477 [473]; Clubb (2019) 267 CLR 171 at 304-305 [389]-[391], ensuring constitutional facts necessary to support the validity of the law are before the court185. Trespassers and those complicit in the trespass If ss 11 and 12, in their operations with s 8, only burdened the political communication of trespassers and those complicit in (or party to) the trespass186, they would not infringe the implied freedom. Degree of justification It is important to keep in mind the nature and extent of the burden, as it directly affects the degree of justification required. In this context – trespassers and those complicit in (or party to) the trespass – the burden imposed by ss 11 and 12, in their operations with s 8, is indirect and not insubstantial. Importantly, the burden only relates to the possession and communication of the product of unlawful conduct (trespass) by those directly involved in or complicit in that conduct. A burden of that kind is, in the context of our system of government underpinned by the rule of law, readily justified. The degree of justification required is, therefore, low. Rational connection The plaintiffs conceded that ss 11 and 12 clearly have a "rational connection" to the purpose of ensuring that the privacy of individuals is not unjustifiably impinged upon by the unlawful use of surveillance devices. That concession is limited to the first of the identified dual purposes. For the reasons explained earlier, ss 11 and 12, in their operations with s 8, also have a "rational connection" to the second and related legitimate purpose. Burden not "undue" Once it is accepted, as it has been, that the burden is indirect and not insubstantial, that the burden is of a kind that is readily justified, and that ss 11 and 12, in their operations with s 8, are rationally connected to the legitimate purposes 185 McCloy (2015) 257 CLR 178 at 201 [24]; Brown (2017) 261 CLR 328 at 370 [131]; Unions NSW (2019) 264 CLR 595 at 622 [67], 631-632 [93]-[96], 650-651 186 cf Lenah Game Meats (2001) 208 CLR 199 at 228 [46]-[47]. See also Bartnicki v Vopper (2001) 532 US 514. they seek to serve, no further analysis is required. It is these factors which show why the burden is not "undue"187. The matter may be explained in this way. The provisions are closely connected to, and advance, their legitimate dual purposes of protection of privacy and dignity and protection of property rights. The indirect and not insubstantial incremental burden in relation to trespassers and those complicit in (or party to) the trespass is readily justified by the legitimate purposes of the provisions. To the extent that they apply to trespassers and those complicit in trespass who may then seek to publish unlawfully obtained information resulting from trespass, ss 11 and 12, in their operations with s 8, are reasonably appropriate and adapted to advance the legitimate dual purposes of protecting the privacy of individuals and protecting property rights from being unjustifiably impinged upon. It is open to Parliament to prevent such persons from benefiting from the fruits of their unlawful conduct. Indeed, if the provisions were not valid in their operation with respect to trespassers and those complicit in trespass, the consequence would be that it would be beyond legislative power to create a statutory tort of privacy that ever speaks to political matters. That cannot be right. It would also mean, for example, that the Telecommunications (Interception and Access) Act 1979 (Cth) would be invalid insofar as it prohibited publication of an unlawfully obtained intercept if the intercept was of a matter that concerned political issues. Consistently with their identified and legitimate dual purposes, ss 11 and 12, in their operations with s 8, ensure that trespassers and those complicit in trespass are deprived of the fruits of their unlawful conduct. Insofar as they operate in that way, ss 11 and 12 may be seen to adequately and appropriately balance the protection of privacy and dignity and protection of property rights with the implied freedom of political communication. The plaintiffs sought to demonstrate that ss 11 and 12 are invalid by comparing them with legislative provisions enacted in other jurisdictions, particularly Victoria, the Northern Territory, South Australia and Western Australia. The plaintiffs asserted that the mere existence of these alternative schemes was fatal to the constitutional validity of ss 11 and 12. They submitted that the Acts in those other States and the Northern Territory exemplified a workable and valid carve-out which accommodates the implied freedom of political communication, whilst adequately addressing the purposes to which the Surveillance Devices Act is directed. In essence, the plaintiffs relied on the fact that there is no "public interest" or "whistleblower" exception to ss 11 and 12 of the Surveillance Devices Act, whereas other Acts in other jurisdictions contain exceptions of that kind. They submitted that ss 11 and 12 "could easily be adapted to allow for some political communication in the public interest (at least, where a 187 Clubb (2019) 267 CLR 171 at 304 [389]. Judge finds that the publication is in the public interest)" and, failing that, they impose "too great a burden on the possibility for legitimate publication of surveillance device material that blows a whistle". The plaintiffs' argument is to be rejected on two grounds. First, it proceeds from a misunderstanding of the legitimate purposes of ss 11 and 12. The plaintiffs' argument fails to take account of the dual purposes of the provisions. Second, it is neither necessary nor helpful to consider whether the schemes enacted in other States and the Northern Territory are "obvious and compelling" and "equally practicable" alternatives to ss 11 and 12188. The schemes adopted in different jurisdictions simply reflect that there may be numerous means which the legislature may select from when seeking to achieve the same legitimate purposes189. That is because the implied freedom accommodates latitude for parliamentary choice in the implementation of public policy190. The different choices that may be made are reflected in the significantly different approaches adopted in different jurisdictions to regulating the installation, use and maintenance of surveillance devices. The other schemes adopted by other States and the Northern Territory are not obvious and compelling alternatives. None of the other schemes work with or instead of ss 11 and 12, in their operations with s 8. They have different starting points and different purposes and adopt different approaches and structures. The plaintiffs' reliance on the scheme introduced in Victoria is illustrative. It does have a public interest exception controlled, at least to some extent, by the courts191. But a public interest exception would permit publication and communication to a greater extent than the implied freedom would require and, if that was not enough, the exception applies to both lawfully and unlawfully obtained information. None of this is intended to suggest that the adoption of a different scheme, including appropriate exceptions for communicating or publishing unlawfully obtained material, may be constitutionally valid. If the provisions stopped in their operation to trespassers and persons otherwise complicit in trespass, they would not infringe the implied freedom. They would capture a person in the position of Mr Delforce, who has engaged in trespass himself and then possesses surveillance device material obtained in respect of his own trespass (contrary to s 12) and wishes to communicate that material to others (contrary to s 11), as well as a person in the position of Farm 188 LibertyWorks (2021) 95 ALJR 490 at 509 [78]; 391 ALR 188 at 207. 189 cf Unions NSW (2019) 264 CLR 595 at 638-639 [113]. 190 LibertyWorks (2021) 95 ALJR 490 at 536 [202]; 391 ALR 188 at 243. 191 Surveillance Devices Act 1999 (Vic), s 11(2)(b)(i). Transparency, a corporation which is not physically involved in trespass, but which may be taken to be complicit in the trespass because a director of the corporation is the trespasser, and that director has "significant involvement" in the corporation's operations. Farm Transparency cannot be described merely as an innocent recipient of information obtained by trespass. Third-party publishers – innocent recipients By imposing a blanket prohibition on the disclosure and publication of information obtained in contravention of s 8, ss 11 and 12 extend beyond trespassers and persons complicit in trespass to what might be described as third-party publishers. In their operation with respect to those persons, ss 11 and 12 overreach in a number of respects, such that they are not reasonably appropriate and adapted to advancing their legitimate purposes. Degree of justification In this context the burden imposed by ss 11 and 12, in their operations with s 8, is indirect but significant. Section 11 prohibits a third-party publisher from communicating any aspect of the unlawfully obtained information which concerns governmental or political matters. As we have seen, s 11 relevantly applies to publishing and communicating a "report" of the carrying on of an activity. This would prevent, for example, a third party not complicit in the trespass who receives information about the "substance" of an activity where it has come to the person's knowledge as a direct or indirect result of a contravention of s 8 from communicating that information to others (even if not showing the actual footage). In their operation with respect to third-party publishers, such as media outlets, who receive information or material and know that it was obtained in contravention of s 8, ss 11 and 12 would operate as a blanket prohibition on possessing and communicating any information or material about governmental or political matters. That is significant. The degree of justification required is, therefore, high. Rational connection Rational connection has been addressed above and the same reasoning applies equally here. Burden "undue" Sections 11 and 12 are blunt instruments. In their terms they would prevent, for example, media outlets communicating about footage that reveals unlawful conduct taking place at an abattoir or even unlawful conduct engaged in by the Government. To the extent that ss 11 and 12 apply to third-party publishers they are not reasonably appropriate and adapted to advancing their dual purposes. The earlier criticisms of the plaintiffs' reliance on the schemes adopted in other States and the Northern Territory apply with equal force here. Answers It is for those reasons that ss 11 and 12, in their operations with s 8, should be read down. Sections 11 and 12 operate in an area where Parliament's legislative power is subject to a clear limitation – the implied freedom of political communication. The sections can and should be read as subject to that limitation192 and, in their operations with s 8, as having no application to the extent that the provisions place an unjustified burden on communication on governmental or political matters. That is the criterion by which the partial operation of the statute is determined. It would not be necessary, and indeed it would be inappropriate, to read ss 11 and 12 as subject to a complete exclusion of political and governmental communication. The questions stated for the opinion of the Full Court should be answered as follows: Does s 11 of the Surveillance Devices Act impermissibly burden the implied freedom of political communication? Answer: Yes, in its operation with s 8, to the extent that it places an unjustified burden on communication on governmental or political matters. If "yes" to Question 1, is s 11 of the Surveillance Devices Act severable in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Answer: Yes. Does s 12 of the Surveillance Devices Act impermissibly burden the implied freedom of political communication? Answer: Yes, in its operation with s 8, to the extent that it places an unjustified burden on communication on governmental or political matters. 192 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 502-503. See also Tajjour (2014) 254 CLR 508 at 586 [171]; Clubb (2019) 267 CLR 171 at 221 [148], 290 [340]. If "yes" to Question 3, is s 12 of the Surveillance Devices Act severable in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Answer: Yes. 5. Who should pay costs? Answer: The defendant. Edelman What this case is not about A concerned member of the public, while present at a political event on private premises without invitation, overhears a conversation between senior members of the Government. The senior members of the Government are discussing their participation in an unlawful enterprise involving wiretapping of Opposition premises, and using the Australian Taxation Office and the Australian Secret Intelligence Service to target political opponents. The concerned member of the public uses a smartphone to make an audio-visual recording of the conversation and provides the recording to a journalist at a national newspaper. The journalist and the editor of the newspaper are aware that the conversation was unlawfully recorded but they want to publish the details to inform the public of these matters of enormous political importance. Even if they cannot publish the information, they want to communicate it to the Australian Federal Police. In these hypothetical circumstances, s 11 of the Surveillance Devices Act 2007 (NSW), read with s 8, prohibits the journalist or editor from publishing or communicating the information, with penalties of up to $11,000 and five years' imprisonment193. Section 12 prohibits the journalist or editor from even possessing the recording. Would the application of ss 11 or 12 of the Surveillance Devices Act to such circumstances demonstrate that those provisions contravene the implied freedom of political communication? Would it make a difference if the recording also exposed the identities of Australian intelligence operatives whose lives would be threatened by any communication or publication of the information? On the one hand, in these hypothetical circumstances the Surveillance Devices Act could suppress communication in this country of issues that, in other countries, have been fundamental to government or political matters. On the other hand, an unrestrained freedom may promote an approach that asks: "Why send a reporter to put a foot in the front door when the publisher can be confident that a trespasser with an axe to grind or a profit to be made will be only too willing to break and enter through a back window?"194 The point of these hypothetical examples is to illustrate the vast, unexplored breadth of the plaintiffs' challenge in this special case, extending to circumstances far removed from the factual substratum of this case. The plaintiffs' challenge to ss 11 and 12 of the Surveillance Devices Act, on the basis that those sections 193 Surveillance Devices Act 2007 (NSW), s 11(1) read with Crimes (Sentencing Procedure) Act 1999 (NSW), s 17. 194 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR Edelman contravene the implied freedom of political communication in the Constitution, involved no submissions on such hypothetical scenarios or anything like them. Legal issues and factual nuances related to any such hypothetical scenarios were not explored. This Court should be very wary before adjudicating on a broad basis that extends over all such hypothetical cases. What this case is about I gratefully adopt the description of the circumstances of this special case set out in the reasons of Kiefel CJ and Keane J. It is important to emphasise three features of the special case to demonstrate the issues that properly arise for decision. First, the facts of the special case are concerned only with the operation of ss 11 and 12 of the Surveillance Devices Act based upon a contravention of s 8. The facts of the special case do not raise any issue concerning the operation of ss 11 and 12 based upon a contravention of ss 7, 9 or 10, which prohibit the installation, use and maintenance of a listening device, a tracking device, or a data surveillance device. The second feature of the facts of the special case is that they concern only the communication or publication of unlawfully obtained information by trespassers and those complicit in the trespass under s 8 of the Surveillance Devices Act. The facts do not concern third party recipients of information such as journalists or editors, or any other third parties who receive the information with or without knowledge of the unlawful manner in which it was obtained. In that respect, the circumstances of this case are very different from those in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd195, where it was not alleged that the appellant broadcaster "was implicated in or privy to the trespasses upon the premises" or "knowing[ly] participat[ed] ... in what is alleged to have been the relevant wrongdoing"196. The goals of the first plaintiff, Farm Transparency International Ltd, and the second plaintiff, Mr Delforce, as a director of the first plaintiff, include educating the public about cruelty to non-human animals and advocating for law reform, including by providing evidence and reporting on farming practices. Mr Delforce has dedicated his life to "working towards alleviating the suffering of animals through public education and efforts to change the law". He has been a director of Farm Transparency since its incorporation and an officer of its 195 (2001) 208 CLR 199. 196 (2001) 208 CLR 199 at 247-248 [104]. Edelman Mr Delforce gives numerous examples of circumstances in which Farm Transparency or its predecessor corporation of which he was an officer have published audio-visual footage of animal suffering. He speaks about images and footage from 21 piggeries, a turkey farm, a duck farm, a turkey abattoir, a cage egg facility, two "farm" eggs facilities, and two "pet food" facilities. In every instance, Mr Delforce was the person who took the footage or was complicit in, or aware of, the process of taking the footage or the installing of cameras on the premises. On each of the numerous occasions when Mr Delforce published his recordings of non-human animal cruelty to which he refers in his affidavit, Mr Delforce used Farm Transparency or its predecessor corporation, and their websites, as a vehicle to publish the photographs and audio-visual footage of non-human animal cruelty. Farm Transparency wishes to continue to publish information, including video recordings, that show non-human animal cruelty practices without the burden imposed by the Surveillance Devices Act. To the extent that the special case discloses any trespasses by Mr Delforce in contravention of s 8 of the Surveillance Devices Act, the natural inference is that those trespasses occurred as part of a common design, or sharing a common purpose, with Farm Transparency, of which he has always been a director, in order to obtain recordings of cruelty to non-human animals for publication by Farm Transparency. Even if Mr Delforce's actions were not, and will not be, undertaken as an agent of Farm Transparency197 or able to give rise to joint liability based on a common purpose198, a possible inference from the material in the special case is that Farm Transparency is, or will likely be, an accessory before the fact199 and potentially liable for an offence under s 8. At the least, in the circumstances of past contraventions described by Mr Delforce, Farm Transparency or its predecessor corporation would be, to use the language of Gleeson CJ, "complicit" in any trespass under s 8200. 197 Environment Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477 at 514; Northern Land Council v Quall (2020) 94 ALJR 904 at 921 [82]; 383 ALR 378 at 398. See also Criminal Procedure Act 1986 (NSW), s 10(1). 198 McAuliffe v The Queen (1995) 183 CLR 108 at 114; Miller v The Queen (2016) 259 CLR 380 at 388 [4]; IL v The Queen (2017) 262 CLR 268 at 283 [30]. 199 McAuliffe v The Queen (1995) 183 CLR 108 at 113-114; Osland v The Queen (1998) 197 CLR 316 at 341-343 [71]-[73]; IL v The Queen (2017) 262 CLR 268 at 283 200 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR Edelman The third feature of the facts of the special case is that there has been no finding of any court, nor was there any submission either in writing or orally, that established the unlawfulness of any activity depicted in a record that was obtained or that might be obtained. No law was identified in submissions by the plaintiffs that might potentially have made such activities unlawful and the State of New South Wales thus had no opportunity to address the nature or scope of any unlawful activity on private property that might be disclosed by the plaintiffs. Mr Delforce has been involved in many incidents of covert recording of farming activities involving considerable suffering of non-human animals. Some images from such recordings were exhibited to the affidavit of Mr Delforce, which was part of the special case. They reveal shocking cruelty to non-human animals. They may very well have been unlawful as well as immoral. But even apart from the lack of submissions about the basis for any illegality, the special case does not assert that any of the recorded activities had been found to be unlawful. Many of the recordings made by Mr Delforce were not referred to the police or to the Royal Society for the Prevention of Cruelty to Animals (RSPCA) because he considered that the practices, whilst cruel, were not illegal. On the occasions that Mr Delforce did refer recordings to the police or to the RSPCA, there was no successful prosecution. Therefore, on the facts stated and in light of the manner in which the argument developed, this special case was presented on the basis that the activities, albeit undeniably cruel, were not established to be unlawful. The circumstances of the special case therefore raise the question of whether the implied freedom of political communication is contravened by the operation of ss 8, 11 and 12 of the Surveillance Devices Act in prohibiting trespassers and those complicit in a trespass from publishing or communicating information exclusively obtained from that trespass and which does not reveal unlawful conduct. The answer is that ss 8, 11 and 12 of the Surveillance Devices Act are not invalid in their application to such general circumstances. Restraint in considering the application of the challenged provisions In Knight v Victoria201, this Court considered the validity of s 74AA of the Corrections Act 1986 (Vic) in circumstances in which doubt was raised about the valid application of that section to judicial officers who are members of the Adult Parole Board. But, as the Corrections Act permitted, no current judicial officer had been involved in any consideration of Mr Knight's application. This Court held that s 74AA was not invalid in the circumstances before it. Even if it were invalid in circumstances in which the Adult Parole Board was constituted by a current judicial officer, it could be disapplied in that application. Section 6 of the Interpretation of Legislation Act 1984 (Vic), which mirrors s 15A of the Acts 201 (2017) 261 CLR 306. Edelman Interpretation Act 1901 (Cth), would avoid any invalidity because "the application of that provision to other persons, subject-matters or circumstances shall not be affected". The Court said that "[i]t is not the practice of the Court to investigate and decide constitutional questions unless there exists a state of facts which makes it necessary to decide such a question in order to do justice in the given case and to determine the rights of the parties"202. The caution enunciated in Knight was said to mean that it is "ordinarily inappropriate for the Court to be drawn into a consideration of whether a legislative provision would have an invalid operation in circumstances which have not arisen and which may never arise", provided that the hypothetical application of the provision could be disapplied if it were found to be invalid203. The qualifier "ordinarily" was an error. It stated the restriction too strictly204. It neglected the role of this Court to deal with cases before it by establishing principles that apply, at least to some extent, more generally than in their immediate application to the party before the Court. On the other hand, it is an error at the other extreme to assume that because a party has standing to raise a question, so that it is possible for the question to be addressed, the party is entitled to an adjudication of the totality of its claim, extending to all asserted applications of a law, whether or not that party is affected by those applications. There is a basic difference between rules of standing, which make an adjudication possible, and pragmatic rules concerning the extent to which adjudication is appropriate205. The difficult question in many cases will be the identification of the appropriate level of generality, between the particular application to the party before the Court and all possible applications, at which to adjudicate upon validity206. It is appropriate in this case for the Court to adjudicate upon the validity of ss 11 and 12 only in their application with s 8, which prohibits installing, using or maintaining an optical surveillance device. In that application with s 8, it is also appropriate to consider ss 11 and 12 in the generality of circumstances involving 202 (2017) 261 CLR 306 at 324 [32], quoting Lambert v Weichelt (1954) 28 ALJ 282 at 203 (2017) 261 CLR 306 at 324 [33]. 204 Private R v Cowen (2020) 94 ALJR 849 at 886 [158]; 383 ALR 1 at 44. 205 Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 852-853 [100]; 393 ALR 551 at 574. 206 See eg Palmer v Western Australia (2021) 95 ALJR 229 at 238 [25], 271 [202], 274-277 [223]-[234]; 388 ALR 180 at 187, 229-230, 234-238. Cf (2021) 95 ALJR 229 at 248 [90], 249 [93]; 388 ALR 180 at 201-202. Edelman the publication or communication by trespassers or those complicit in the trespass of a record or report of lawful activities on private premises or in a vehicle207. No submissions have been made upon many of the applications of ss 11 and 12 of the Surveillance Devices Act beyond these circumstances that are relevant to the parties. A determination of the validity of ss 11 and 12 in other potential applications would not merely require this Court to speculate on circumstances that are not before it and have not been the subject of any argument such as the difficult examples raised at the start of these reasons, which are entirely hypothetical in the context of the facts before this Court. A determination of the validity of ss 11 and 12 beyond their application with s 8 in the circumstances of this case would also require this Court to speculate upon legal principles which have not been the subject of any argument208. An example of a legal principle that was not the subject of any argument is the precise extent to which the pre-existing law, including duties of confidence, encompasses or extends beyond the prohibitions in ss 11 and 12 of the Surveillance Devices Act. To that extent, the prohibitions regulate conduct in which there is no existing freedom to engage. For instance, does the existing law of confidence impose a duty upon third parties not to communicate or publish any personal information? What is the scope of "personal" information? Would that duty extend to circumstances where the third party has no actual knowledge that the information is personal, although they ought reasonably to have known that it was confidential? Although it is not appropriate to do so, it would be possible for this Court to adjudicate more broadly upon the questions before it in this case. It would be possible to adjudicate on a basis that extends to a scenario in which Farm Transparency, like the journalist and the editor of the newspaper discussed at the commencement of these reasons, publishes or communicates information in contravention of ss 11 or 12, which information was obtained by a breach of s 8 in which it was not complicit. But the special case does not indicate whether Farm Transparency intends to engage in those acts without being complicit in a contravention of s 8, or the manner in which it would do so. There is nothing in the special case to indicate what those circumstances of non-complicity might be, how they might arise, and whether they are likely to occur. If this Court were to adjudicate on a basis that extended to such scenarios then it would be dispensing advice to Farm Transparency about hypothetical scenarios that Farm Transparency has not raised and without any knowledge of the circumstances in which those 207 Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 854 [107]; 393 ALR 208 Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 853 [105], 854 [107]; 393 ALR 551 at 575, 576. Edelman scenarios might arise. And to do so, this Court would also need to consider legal issues that have not been argued. One speculation might be that a person who has obtained a record or report in contravention of s 8, without prior complicity of Farm Transparency, might approach Farm Transparency seeking to have the record or report published. A further speculation might be that Farm Transparency might wish to publish that record or report. But is such a scenario likely? And what would the circumstances of that scenario be in order to assess the practical effect on it of the Surveillance Devices Act? Would an unrelated third party trespasser be more likely to seek to publish a record or report of lawful, rather than unlawful, activities through Farm Transparency without any complicity of Farm Transparency in the trespass? Are there features or advantages of the Farm Transparency online platform that would provide any advantage to the unrelated third party over personal online publication or through an established media outlet with larger outreach? Would Farm Transparency be able to verify the record or report received from an unrelated third party? Would Farm Transparency exercise any caution in scrutinising any record or report before publishing? Has this ever happened before? The breadth of the relief sought by the plaintiffs would also require this Court to speculate on legal issues related to confidential information that have not been argued in order to decide their application to a scenario that has not been raised and which might never arise. The Court is not required to do so, and should not do so, if the words of ss 11 and 12 can be read down, severed, or disapplied from such scenarios. As to the circumstances of the general nature of those before the Court, the words of ss 11 and 12 of the Surveillance Devices Act cannot be "read down"209 as though they exclude unlawful conduct pursuant to ss 7, 9 or 10. Nor could they be read down, in relation to their operation based on s 8, to exclude third parties who were not complicit in the trespass, or private conversations on government or political matters concerning unlawful conduct, or unlawful private activities that concern government or political matters. To read a provision "down" it must at least be open to be "read" in that way. It is not possible to read down ss 11 and 12 in those ways because it is not open, even on the most strained interpretation, to read those provisions as though their meaning was confined by exceptions drafted broadly in those terms. To read down those provisions to produce such a meaning "would not be judicial interpretation but judicial vandalism"210. Nor are there any independent words of ss 11 and 12 that can be relevantly severed to achieve these 209 See Clubb v Edwards (2019) 267 CLR 171 at 313-314 [416]-[417]. 210 R (Anderson) v Secretary of State for the Home Department [2003] 1 AC 837 at 883 Edelman exceptions by "striking out or disregarding words that are in the section" from the "severable" remainder211. It is possible, however, for ss 11 and 12 to be partially disapplied to the extent that they are invalid in any or all of: (i) their operations with ss 7, 9 or 10; (ii) their applications to persons who were not a party to the trespass under s 8; and (iii) their applications to information or recordings that concern unlawful activity of a governmental or political nature. If it were necessary to disapply the Surveillance Devices Act from such circumstances, which are not raised in this case, then it would be possible to do so212. It is necessary to emphasise that to confine adjudication of the plaintiffs' claim to the application of the law to the facts generally before the Court is, emphatically, not to deny relief to the plaintiffs due to past contraventions of, or complicity in contraventions of, s 8. Just the opposite: the adjudication of the plaintiffs' claim is confined to the appropriate bounds based upon the material before the Court which concerns past and possible future contraventions and complicity in contraventions. The interpretation of ss 8, 11 and 12 of the Surveillance Devices Act I agree with the interpretation of ss 8, 11 and 12 as set out in the reasons of Kiefel CJ and Keane J213, together with the reasons of Gordon J214. That interpretation may have significant effects upon third party recipients of recordings, like those considered at the outset of these reasons, in circumstances where such scenarios have not been the subject of submissions and the interests of the third parties are not represented before this Court. For the purposes of this special case, it suffices to illustrate two further, and significant, constraints upon the operation of ss 8, 11 and 12 that arise from that interpretation. First, the scope of application of ss 11 and 12 is confined by the twin requirements that are expressed or implied, being (i) an intention to publish or communicate the record or report, or to possess the record, and (ii) knowledge that the information is a direct or indirect result of the use of an optical surveillance device in contravention of s 8. 211 The Federated Amalgamated Government Railway and Tramway Service Association v The New South Wales Railway Traffic Employes Association (1906) 4 CLR 488 at 546-547. 212 Interpretation Act 1987 (NSW), s 31(2). Edelman Contrary to the submissions of the plaintiffs, not every recipient of a surreptitious recording of an activity on premises will know that the recording was made in breach of s 8 of the Surveillance Devices Act. Indeed, without more, the mere receipt of such a recording will rarely be sufficient to infer such knowledge, since the recording could have been made covertly by any visitor or employee on the premises. For example, a visitor or employee who enters farming property by invitation or for work purposes will rarely become a trespasser merely because they also have a purpose of obtaining surreptitious recordings215. Secondly, ss 11(3) and 12(2)(c) further confine the scope of operation of ss 11(1) and 12(1) respectively to circumstances where the knowledge or record has been obtained exclusively by a contravention of Pt 2, including by trespass within the meaning of s 8. Section 11(3) exempts from the prohibition in s 11(1) the communication or publication of knowledge that is also obtained by means that are not contrary to Pt 2. For instance, if a person obtains knowledge of non-human animal mistreatment practices by a recording that is contrary to s 8, but obtains the same knowledge from an employee, then s 11(3) permits the communication or publication of the information received from the employee. Section 12(2)(c) provides a similar exemption from the prohibition in s 12(1), so that in the same example the person would not commit a possession offence under s 12(1). The incremental burden on the freedom of political communication The implied freedom of political communication is a constitutional limit upon legislative power to constrain the liberty of the people to communicate on government or political matters. Where the general law validly denies liberty of communication on particular political matters, then any law that imposes a prohibition upon political communication can only incrementally burden the implied freedom in so far as it extends beyond the existing prohibition. For that reason, this Court has consistently denied that the freedom implied in the Constitution, as a limit on legislative power, prevents a Parliament from regulating communications that a person is not free to make216. To recognise otherwise would transmogrify the constitutional protection of a freedom into a constitutional claim right. The consistency of ss 8, 11 and 12 with the implied freedom of political communication therefore falls to be determined by reference to the incremental burden that those provisions, in their relevant application, impose upon the existing 215 Roy v O'Neill (2020) 95 ALJR 64 at 78-79 [72]-[73]; 385 ALR 187 at 204-205. 216 Levy v Victoria (1997) 189 CLR 579 at 595, 622, 625-626, approved in Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 223-224 [107]-[108], 246 [184], 298 [337], 303-304 [354]; Brown v Tasmania (2017) 261 CLR 328 at Edelman liberty of political communication. The most significant area of the relevant operation of ss 8, 11 and 12 of the Surveillance Devices Act in which there is no liberty of political communication is where the publication or communication of the information would be a breach of confidence. Three categories of the action for breach of confidence The equitable wrong of breach of confidence is an overarching doctrine. It can only be understood by appreciating that it encompasses three overlapping and closely related categories concerning information that is private, in the sense of information that is not publicly available. The first category is private information that arises in the course of a relationship of confidence. The second category is private information that is secret. The third category is private information that is personal in the sense that it concerns the dignity of an individual. (1) Private information communicated in a relationship of confidence Perhaps the longest-established category of action for breach of confidence lies in a duty upon a recipient of private information to respect the confidence in which the information was known to have been imparted during service for another or in the course of a relationship with another217. The information must bear the character of being confidential, but that character is not narrowly defined. It can arise from any objective assumption of responsibility, whether contractual or not, to maintain confidence in respect of information expressly or impliedly imparted as confidential. Such an assumption of responsibility can be recognised in any relationship and can survive the termination of a contract if that was objectively intended218. The examples in the authorities of such relationships are as varied as information provided by a patient to a doctor219, by Indigenous Australians to an anthropologist220, or by an employer to an employee221. 217 Johns v Australian Securities Commission (1993) 178 CLR 408 at 426-427, quoting Attorney-General v Guardian Newspapers Ltd [No 2] [1990] 1 AC 109 at 214. See also Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] (1984) 156 CLR 414 at 218 See eg Prince Jefri Bolkiah v KPMG (a firm) [1999] 2 AC 222 at 235. 219 Breen v Williams (1996) 186 CLR 71. 220 Foster v Mountford and Rigby Ltd (1976) 14 ALR 71. 221 N P Generations Pty Ltd v Feneley (2001) 80 SASR 151. Edelman (2) Private information that is secret Another well-established basis for an action for breach of confidence is where a recipient comes into possession of information that is known to be secret, even if the information is not imparted in confidence in the course of a relationship. As a "matter of plain English 'confidential' means that which is intended to be kept secret, and 'confidentiality' is the state of keeping something secret or private"222. As Lord Goff said in his masterly speech in Attorney-General v Guardian Newspapers Ltd [No 2]223: "[I]n the vast majority of cases, in particular those concerned with trade secrets, the duty of confidence will arise from a transaction or relationship between the parties ... But it is well settled that a duty of confidence may ... include certain situations, beloved of law teachers – where an obviously confidential document is wafted by an electric fan out of a window into a crowded street, or where an obviously confidential document, such as a private diary, is dropped in a public place, and is then picked up by a passer-by. I also have in mind the situations where secrets of importance to national security come into the possession of members of the public". The concept of a "secret" is somewhat elastic. Lord Franks, who inquired into s 2 of the Official Secrets Act 1911 (UK)224, is said to have remarked that an Oxford secret is one that is told only to one person at a time. In Ansell Rubber Co Pty Ltd v Allied Rubber Industries Pty Ltd225, Gowans J spoke of a "sufficiently substantial element of secrecy" so that, "except by the use of improper means, there would be difficulty in acquiring the information". (3) Private information that is personal The "secret" shades into the "personal". Once it is accepted, as it should be, that the quality of confidence extends to information that is "significant, not necessarily in the sense of commercially valuable ... but in the sense that the preservation of its confidentiality or secrecy is of substantial concern to the plaintiff"226, no principled basis can exist for treating personal information differently from secret information where both are private. 222 Murray v Turcan Connell WS 2019 SC 403 at 417 [40]. 223 [1990] 1 AC 109 at 281. 224 1 and 2 Geo 5 c 28. 225 [1967] VR 37 at 39, 50. 226 Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] (1984) 156 CLR 414 at 438. Edelman Personal information should have no less protection than a trade or other secret merely because it is not of commercial value to a plaintiff. Personal information includes information and images about the personal struggle of a fashion model with drug addiction227, the personal details of someone's consensual sexual activity228 or other "private act"229, a private wedding230, or a man in his underpants in his bedroom231. As Gummow J said in Breen v Williams232, the misuse of confidential information that can be restrained in equity is not limited to trade secrets but "extends to information as to the personal affairs and private life of the plaintiff, and in that sense may be protective of privacy". The utility, however, of a separate category concerning personal information may lie in the potential wrongfulness of communicating or publishing such information even where, to some degree, it is in the public domain. It may be that personal information should be protected not merely where the information is secret, but also where further disclosure would compromise foundational interests of human dignity and autonomy233. In PJS v News Group Newspapers Ltd234, Lord Neuberger (with whom Lady Hale, Lord Mance and Lord Reed agreed) quoted with approval from the following statement of Eady J235: "It is fairly obvious that wall-to-wall excoriation in national newspapers … is likely to be significantly more intrusive and distressing for those concerned than the availability of information on the Internet or 227 Campbell v MGN Ltd [2004] 2 AC 457. 228 Giller v Procopets (2008) 24 VR 1. 229 Hellewell v Chief Constable of Derbyshire [1995] 1 WLR 804 at 807; [1995] 4 All ER 473 at 476. See also Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 224 [34]. 230 Douglas v Hello! Ltd [2001] QB 967. See also Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 225 [37]. 231 Donnelly v Amalgamated Television Services Pty Ltd (1998) 45 NSWLR 570. See also Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 230-231 [54]-[55]. 232 (1996) 186 CLR 71 at 128. 233 See Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 226 [43], 256 [125]. 234 [2016] AC 1081 at 1109 [61]. 235 CTB v News Group Newspapers Ltd [2011] EWHC 1326 (QB) at [24]. Edelman in foreign journals to those, however many, who take the trouble to look it up ... For so long as the court is in a position to prevent some of that intrusion and distress, depending upon the individual circumstances, it may be appropriate to maintain that degree of protection." (emphasis in original) Whatever might be the boundaries of this category of confidential information, its protection extends beyond the secrecy of the information to the dignity of the individual. The use of the action for breach of confidence in this category to protect the privacy and dignity of the individual is not novel. In 1849, in Prince Albert v Strange236 the Lord Chancellor referred to an earlier decision of Lord Eldon to the effect that the court would restrain the publication, in the king's lifetime, of a diary kept by one of the king's physicians of what they had seen and heard about the health of the king. That decision was one of the foundations of the law of privacy in the United States237. Extending breach of confidence? In Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd238, this Court considered whether principles concerning breach of confidence extended to the publication of a film showing cruelty to possums which had been obtained "by unlawful entry and secret surveillance" although the activities recorded were not "secret", and nor was a relationship of confidence "imposed upon people who might see the operations". The different reasons given by members of this Court, Callinan J dissenting, for allowing the appeal and refusing relief illustrate the different views concerning the boundaries of the action for breach of confidence. The most restrictive approach, at least in relation to individuals, was taken by Gleeson CJ, who considered that the protection afforded by the law concerning breach of confidence did not extend to every activity done on private property. His Honour said that the activities had been conducted on private property, but had not been shown to be private in any other sense239. Gleeson CJ said that the foundation of much of the privacy protection afforded by the action for breach of confidence is "human dignity"240. Although Gleeson CJ did not express a final conclusion, he 236 (1849) 1 Mac & G 25 at 46 [41 ER 1171 at 1179]. 237 See Warren and Brandeis, "The Right to Privacy" (1890) 4 Harvard Law Review 193 at 201-205. See also Dal Pont, Law of Confidentiality, 2nd ed (2020) at 73-74 238 (2001) 208 CLR 199 at 221 [24]-[25]. 239 (2001) 208 CLR 199 at 224 [35]. 240 (2001) 208 CLR 199 at 226 [43]. Edelman nevertheless suggested that the action for breach of confidence might, in some circumstances, protect the privacy of a corporation241. A potentially broader approach to breach of confidence was taken by Gummow and Hayne JJ, with whom Gaudron J relevantly agreed242, although their approach was narrower in respect of the persons entitled to rely on a breach of confidence. Their Honours referred to circumstances of breach of confidence as potentially including "the disclosure of private facts and unreasonable intrusion upon seclusion"243 but denied the respondent the ability to rely upon those circumstances because it was a corporation rather than a natural person244. Kirby J took an even less restrictive approach than Gummow and Hayne JJ (Gaudron J agreeing), considering that the disclosure of information could be restrained simply on the basis that it was obtained "illegally, tortiously, surreptitiously or otherwise improperly"245. His Honour only allowed the appeal on the basis that an injunction should have been refused as a matter of discretion246. Callinan J took the least restrictive approach and would have upheld the restraint and dismissed the appeal247. At its narrowest, the present state of the law concerning the third category of breach of confidence is, therefore, that it can extend to all private information where human dignity is concerned. In that category, it cannot be conclusively said that it extends to corporations or that human dignity would be compromised by the communication of any private information. There are other boundaries of the law concerning the obligation of confidence that are also unsettled. For instance, there remains dispute about the extent to which the obligation is imposed upon persons who are not primarily liable for a breach of confidence and do not know that the information is confidential. Some cases suggest that the obligation extends to a recipient who could reasonably 241 (2001) 208 CLR 199 at 226-227 [43]. 242 (2001) 208 CLR 199 at 232 [61]. 243 (2001) 208 CLR 199 at 256 [125]. See also at 255 [123]. 244 (2001) 208 CLR 199 at 257-258 [129]-[132]. 245 (2001) 208 CLR 199 at 272 [170]. 246 (2001) 208 CLR 199 at 288 [220]-[221]. 247 (2001) 208 CLR 199 at 341 [353]. Edelman have known that the information was confidential248 and potentially even to "innocent" third parties249, arguably creating a duty in both cases to consider whether information is confidential before communicating or publishing it. Other decisions appear to deny this, other than in circumstances of wilful blindness or where a person has been told that information is in fact confidential250. And others have expressly, and carefully, avoided the controversy of "the extent to which actual knowledge is necessary" beyond circumstances of wilful blindness251. The answer to this question may also depend upon the category of breach of confidence that is involved, particularly because an objective assumption of responsibility creates duties independently of subjective knowledge252. The boundaries of the public interest defence to breach of confidence are also not yet settled. One aspect of that defence is sometimes said to be the principle that a person cannot be made "the confidant of a crime or a fraud"253. As Gibbs CJ observed in A v Hayden254, that defence has been expanded in England to include misconduct generally. However, his Honour did not decide whether that expansion should be embraced in Australia. It has thus been said that the extent to which the defence applies in Australia "is not clear"255. To the extent that the defence operates, it may be doubted whether it permits disclosure to the world at large, or 248 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 225 [39]. See also Minister for Mineral Resources v Newcastle Newspapers Pty Ltd (1997) 40 IPR 403 at 405; Retractable Technologies v Occupational and Medical Innovations (2007) 72 IPR 58 at 74 [61], 77-81 [68]-[86]. 249 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 295 [242], referring to Lenah Game Meats Pty Ltd v Australian Broadcasting Corporation (1999) 9 Tas R 355 at 388-389 [75]-[76]. 250 Vestergaard Frandsen A/S v Bestnet Europe Ltd [2013] 1 WLR 1556 at 1563 [25]-[26], 1565 [39]; [2013] 4 All ER 781 at 789, 791; Earl v Nationwide News Pty Ltd [2013] NSWSC 839 at [17]. 251 Attorney-General v Guardian Newspapers Ltd [No 2] [1990] 1 AC 109 at 281; Hunt v A [2008] 1 NZLR 368 at 384-385 [92]-[94]. Compare Coco v A N Clark (Engineers) Ltd [1969] RPC 41 at 47-48. 252 See eg Wheatley v Bell [1982] 2 NSWLR 544 at 548. 253 Gartside v Outram (1856) 26 LJ Ch 113 at 114. 254 (1984) 156 CLR 532 at 544-545. 255 AG Australia Holdings Ltd v Burton (2002) 58 NSWLR 464 at 513 [177]. Edelman to a narrower audience – for example, relevant law enforcement authorities256. Even the foundations of the defence, based upon a case that has been reported in significantly different terms257, have been questioned258. It is unnecessary to resolve these issues in this case because the application of the implied freedom of political communication in relation to the Surveillance Devices Act can be resolved on the basis of the existing boundaries of the equitable obligations of confidence. The equitable doctrine must develop consistently with the implied constitutional freedom of political communication259. But its present boundaries are entirely consistent with that constitutional freedom. In particular, representative democracy does not provide a licence to disregard express or implied undertakings of confidence or to reveal trade or other secrets. Indeed, representative democracy can be enhanced by the insistence upon undertakings of confidence on matters that relate to the core of political decision-making such as rules concerning the secrecy of recent Cabinet discussion. It is no more necessary for representative democracy to require, in the name of political communication, a liberty to impair a person's dignity by the communication of private and personal information concerning lawful activities that might be characterised in the broad sense as political, than it is for the law to provide a liberty to assault a person or to trespass on a person's property in order to communicate about matters that could broadly be described as political. The validity of ss 8, 11 and 12 in their relevant application The extent of the burden upon political communication In their relevant application to the publication or communication by a person involved in a trespass of a record, obtained by the trespass, showing the carrying on of a lawful activity on private property or in a vehicle, ss 8, 11 and 12 of the Surveillance Devices Act extend beyond the existing law concerning the communication or publication of confidential information. But not far beyond. The complicity of Mr Delforce and Farm Transparency for any breach of ss 11 and 12 arising from a trespass by Mr Delforce contrary to s 8 has a close parallel with the joint liability of persons who are principals of an agent acting in breach of confidence or who have a common purpose that includes breach of 256 Attorney-General v Guardian Newspapers Ltd [No 2] [1990] 1 AC 109 at 282-283. 257 Gartside v Outram (1856) 26 LJ Ch 113; 5 WR 35; 3 Jur (NS) 39; 28 LT (OS) 120. 258 Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 at 259 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 566. Edelman confidence260. But, as explained above, a communication of the type of non-human animal agriculture information described in the special case as having been recorded, and being likely to be recorded, by trespass in which Farm Transparency was complicit was only recognised as capable of protection by obligations of confidence in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd by Kirby J and Callinan J. The other members of the Court treated such circumstances as falling outside the existing law of breach of confidence, either because they are not sufficiently private (Gleeson CJ), or because they might concern activities of a corporation rather than a natural person (Gummow and Hayne JJ, Gaudron J agreeing). In their relevant application, ss 8, 11 and 12 of the Surveillance Devices Act involve an incremental extension of the general law of confidentiality. Although the provisions, unlike equity, do not involve a discretion to refuse to restrain the activity, in both cases the person seeking to communicate or publish has no liberty to do so; other remedies are available in equity. Sections 8, 11 and 12 do, however, extend the prohibition upon communication or publication in two respects. First, they extend to lawful activities on private property or in a vehicle that are not necessarily confidential within the present boundaries of obligations of confidence. Secondly, they extend to circumstances where those activities are carried on by corporations, albeit through human agents. In those two respects, ss 8, 11 and 12 of the Surveillance Devices Act, in their relevant application, impose a burden on the freedom of political communication by restraining those who are complicit in a trespass from revealing private information about lawful activities exclusively obtained from their trespass. The purposes of ss 11 and 12, read with s 8, of the Surveillance Devices Act Section 2A of the Surveillance Devices Act provides for its objects. Apart from objects concerning law enforcement agencies, an object is "to ensure that the privacy of individuals is not unnecessarily impinged upon by providing strict requirements around the installation, use and maintenance of surveillance devices". This express general statement of statutory purposes is necessarily more general than the purpose of a particular provision, which a court is required to characterise with greater specificity; indeed, the general statement of the purposes of an Act might not even touch upon the particular purposes of some provisions261. 260 Vestergaard Frandsen A/S v Bestnet Europe Ltd [2013] 1 WLR 1556 at 1563 [26]; [2013] 4 All ER 781 at 789. See also Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2022) 96 ALJR 89 at 112 [82]; 398 ALR 404 at 425. 261 Unions NSW v New South Wales (2019) 264 CLR 595 at 657 [172]. Edelman The appropriate approach to ascertaining the purpose of particular provisions, as the Solicitor-General of the State of Queensland submitted, is that of the Supreme Court of Canada in R v Moriarity262, where Cromwell J said that if the purpose is "articulated in too general terms, it will provide no meaningful check on the means employed to achieve it" but if it is "articulated in too specific terms, then the distinction between ends and means may be lost". The term "privacy" in s 2A is used in a wide sense to include all intrusions by trespass and all of their consequences. The reference to the privacy of "individuals" cannot confine the purposes of ss 11 and 12, which include protection against "privacy" intrusions on property that is owned by a corporation. As Gordon J explains263, the more specific purposes of ss 11 and 12, read with s 8, are the protection of privacy and dignity and the protection of property rights. The purposes of ss 11 and 12 should not be characterised in such specific terms as being to disincentivise farm trespass. That would confuse the purpose and the means of achieving it. The structured proportionality enquiry There was no dispute that the purposes of ss 11 and 12 of the Surveillance Devices Act, read with s 8, are legitimate, in the sense that it is no purpose of those provisions to burden the freedom of political communication. The issue is whether the legitimate purposes can justify the effect of those provisions – or, perhaps more accurately, the expected effect of those provisions264 – in burdening the freedom of political communication. Different views have been expressed in this Court concerning the party who bears the onus either of establishing a law's lack of proportionality or of justifying a law as proportionate265. But since the party supporting the law is likely to be the party with the most ready access to proof of the anticipated legal and practical effect of the law, the better view is that it is that party who must justify the burden once it is established266. 262 [2015] 3 SCR 485 at 498-499 [28]. 264 Clubb v Edwards (2019) 267 CLR 171 at 334 [470]. 265 See Unions NSW v New South Wales (2019) 264 CLR 595 at 650 [151], fn 230. 266 McCloy v New South Wales (2015) 257 CLR 178 at 201 [24]; Brown v Tasmania (2017) 261 CLR 328 at 370 [131]; Unions NSW v New South Wales (2019) 264 CLR Edelman The legal exercise of assessing whether a burden on the freedom of political communication is justified should be transparent, principled, and structured. Otherwise, it could become, or could be seen to become, an exercise of weighing the burdening effect of a law against little more than a judge's idiosyncratic policy preferences. A structured proportionality approach, repeatedly employed by a majority of this Court267, aims to avoid such problems by assessing whether the law is justified by asking (i) whether its anticipated effects are suitable or rationally connected to its legitimate purpose; (ii) whether there were alternative, "reasonably necessary", means of achieving the same object but with a less restrictive effect upon the freedom of political communication; and (iii) if the anticipated effects are suitable and reasonably necessary, whether they are adequate in the balance between the purpose to be achieved by the law and the extent of the burden imposed on the freedom. It has never been satisfactorily explained why, without any room for extra-judicial policy preferences, a law that fails one of these three criteria for structured proportionality, when they are properly applied, would be consistent with the implied freedom of political communication. Nor has it ever been explained why the implied freedom should invalidate a law that is suitable, reasonably necessary to achieve its legitimate purpose and adequate in the balance. The lack of any acceptable answer to that challenge demonstrates the utility of an analysis based on structured proportionality. The plaintiffs accepted that the purposes of ss 11 and 12 of the Surveillance Devices Act, read with s 8, are legitimate and that the provisions are suitable and rationally connected with those purposes. The two criteria upon which the plaintiffs required the State of New South Wales to justify the burden were whether the provisions are reasonably necessary and adequate in the balance. "Reasonable necessity" In LibertyWorks Inc v The Commonwealth268, I said that the test of reasonable necessity "remains capable of further development and refinement, including the manner in which it applies to different categories of case". Part of the difficulty is the label. If necessity is understood in the ordinary sense of "unavoidable", "compelled", or "indispensable", then the test for reasonable necessity is an oxymoron. Either a choice by Parliament is unavoidable or it is not. It cannot be "reasonably" unavoidable. The test of "reasonable necessity" is really 267 McCloy v New South Wales (2015) 257 CLR 178; Brown v Tasmania (2017) 261 CLR 328; Clubb v Edwards (2019) 267 CLR 171; Unions NSW v New South Wales (2019) 264 CLR 595; Comcare v Banerji (2019) 267 CLR 373; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490; 391 ALR 188. 268 (2021) 95 ALJR 490 at 536 [202]; 391 ALR 188 at 242-243. Edelman one of reasonable choice, with recognition of the wide latitude of choice that must be afforded to Parliament in a system of representative democracy. Hence, an alternative choice that imposes a lesser burden on the freedom of political communication must be "obvious" or "compelling" such that it must be clearly expected to achieve the same purposes, to at least the same extent, and to do so with a significantly lesser burden269. Where the burden on political communication is not great in either its depth or breadth270 it will be easier to justify, as reasonably necessary, the means chosen by Parliament amongst the various alternative policy choices271. The smaller the burden on the freedom of political communication, the less likely it will be that an alternative would impose a significantly lesser burden. In the relevant application of ss 11 and 12 of the Surveillance Devices Act, read with s 8, the burden on the implied freedom of political communication is neither deep nor wide. It is not deep because the only political communication that it prohibits concerns records or reports about lawful activities obtained exclusively as a result of trespass. It is not broad because it extends only to the communication or publication by parties to a trespass contrary to s 8 of the Surveillance Devices Act. Indeed, the Attorney-General for the State of Western Australia even submitted that the constitutional freedom of political communication should not extend at all to "the product of unlawful activity". Although that submission overreaches because the general law does not prohibit trespassers or those who are complicit in the trespass from publishing or communicating non-confidential information, the Attorney-General is correct to the extent that, in some circumstances, equity can respond by injunction against the trespasser to restrain or undo the continuing effects of a trespass272. 269 See Monis v The Queen (2013) 249 CLR 92 at 214 [347]; Tajjour v New South Wales (2014) 254 CLR 508 at 550 [36]; McCloy v New South Wales (2015) 257 CLR 178 at 211 [58], 217 [81], 270 [258], 285-286 [328]; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139], 418-419 [282]; Clubb v Edwards (2019) 267 CLR 171 at 186 [6], 262 [263], 269-270 [277], 337-338 [478]-[480]; Comcare v Banerji (2019) 267 CLR 373 at 401 [35], 452-453 [194]; Palmer v Western Australia (2021) 95 ALJR 229 at 286 [271]; 388 ALR 180 at 249; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 509 [78], 536 [202]; 391 ALR 188 at 207, 243. 270 Clubb v Edwards (2019) 267 CLR 171 at 337-338 [480]. 271 Clubb v Edwards (2019) 267 CLR 171 at 199 [64]. 272 Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 523 [68], 539 [150], 549 [196], 559-562 [248]-[260]; 376 ALR 575 at 592, 613, 626, Edelman The plaintiffs pointed to "alternative models" in laws of Victoria273, the Northern Territory274, South Australia275, Western Australia276, and Queensland277. None of those laws are obvious and compelling alternatives to ss 8, 11 and 12 of the Surveillance Devices Act which could be clearly expected to achieve the same purposes, to at least the same extent, and to do so with a significantly lesser burden. In some respects, although not in others, the alternative models impose a burden on political communication that is deeper than that imposed by ss 8, 11 and 12 of the Surveillance Devices Act. For instance, the alternative models that are concerned with optical surveillance of activities all prohibit obtaining or publishing a record or report of a "private activity" from an optical surveillance device even in circumstances where the record or report was obtained lawfully278. More fundamentally, the alternative models might not be expected to achieve the purposes of the protection of privacy and dignity and the protection of property rights to the same degree as the Surveillance Devices Act. The alternative models, to different degrees, permit exceptions to the offence including, in broad terms, where the communication or publication is: (i) to a media organisation, or by a media organisation and in the public interest, and the device was used in the public interest279; (ii) no more than is reasonably necessary in the public interest280; or (iii) authorised by a court order based on public interest grounds and no more 273 Surveillance Devices Act 1999 (Vic). 274 Surveillance Devices Act 2007 (NT). 275 Surveillance Devices Act 2016 (SA). 276 Surveillance Devices Act 1998 (WA). 277 Invasion of Privacy Act 1971 (Qld). 278 Surveillance Devices Act 1999 (Vic), ss 7(1), 11(1) read with s 3(1) (definition of "private activity"); Surveillance Devices Act 2007 (NT), ss 12(1), 15(1) read with s 4 (definition of "private activity"); Surveillance Devices Act 2016 (SA), ss 5(1), 12(1) read with s 3(1) (definition of "private activity"); Surveillance Devices Act 1998 (WA), ss 6(1), 9(1) read with s 3(1) (definition of "private activity"). 279 Surveillance Devices Act 2016 (SA), s 10(2). 280 Surveillance Devices Act 1999 (Vic), s 11(2)(b)(i); Surveillance Devices Act 2007 (NT), s 15(2)(b)(i). Edelman than is reasonably necessary in the public interest281, where the installation or use of the device was not unlawful282. In each case, the exceptions in the alternative models might be expected to detract from the achievement of the legislative purposes of the protection of privacy and dignity and the protection of property rights. In Kadir v The Queen283, this Court said that "[t]he undesirability of admitting evidence obtained in consequence of the deliberate unlawful conduct of a private 'activist' entity is the effect of curial approval, or even encouragement, of vigilantism". One unstated premise of ss 11 and 12 of the Surveillance Devices Act is that the communication and publication of information obtained in breach of s 8 will be easier to detect than conduct in breach of the primary prohibition upon installation and use of an optical surveillance device by a trespasser. Thus, as Rehnquist CJ said in the Supreme Court of the United States in his dissent in Bartnicki v Vopper284, "Congress and the overwhelming majority of States reasonably have concluded that sanctioning the knowing disclosure of illegally intercepted communications will deter the initial interception itself, a crime which is extremely difficult to detect". Perhaps most fundamentally, the purposes of the alternative models are not the same as those of the Surveillance Devices Act. For instance, there is no mention of privacy in the general objects clause in the Victorian or Northern Territory legislation285 and the Queensland legislation is concerned with the recording of conversations by listening devices and not with the recording of activities by optical surveillance devices286. Ultimately, the alternative models do little more than illustrate the existence of a range of different legislative choices available in a representative democracy to implement different, although perhaps related, policy goals. Adequacy in the balance In the absence of any constitutional restriction, it would be open to Parliament to weigh in the balance the protection of dignity, privacy, and property 281 Surveillance Devices Act 1998 (WA), ss 9(2)(a)(viii), 9(3)(a)(i), 31(1). 282 eg Surveillance Devices Act 1998 (WA), s 25. 283 (2020) 267 CLR 109 at 137 [48]. 284 (2001) 532 US 514 at 549. 285 Surveillance Devices Act 1999 (Vic), s 1; Surveillance Devices Act 2007 (NT), s 3. 286 Invasion of Privacy Act 1971 (Qld). Edelman rights (including security of one's home), on the one hand, with freedom of political communication, on the other. The conclusion that it is not adequate in the balance for Parliament to reach a "reasonably necessary" outcome that might favour dignity, privacy, and security of property is to conclude that the small, incremental burden upon the implied freedom of political communication in the relevant circumstances is a constitutional trump card over dignity, privacy, and security of property. In a representative democracy without a Bill of Rights, that is a large claim. Although a person's right to the peaceful possession of property should no longer be properly treated as being more fundamental than rights to bodily integrity or liberty287, it remains a right of great importance. It would diminish the respect which the law affords to dignity, privacy, and the security of property to conclude that the Surveillance Devices Act is invalid in its application to trespassers, and those complicit in the trespass, who seek to take advantage of their trespass by communicating or publishing a record or report of lawful activities. And that diminished respect would be for the marginal benefit of eliminating only a small incursion upon the implied freedom of political communication, involving a narrow incremental development of the existing general law. The reasons above would be sufficient to conclude that ss 11 and 12 of the Surveillance Devices Act, read with s 8, are adequate in the balance in their relevant application. But the balance is not even truly between the values of dignity, privacy, and security of property, on the one hand, and freedom of political communication, on the other. In the relevant application to trespassers and those complicit in the trespass, the protection of dignity, privacy, and security of property is itself a protection of freedom of political communication. An assault on the one can be an assault on the other. As Gageler J said in Smethurst v Commissioner of the Australian Federal Police288, paraphrasing the State Trials report of Lord Camden's speech in Entick v Carrington289, there is a "link between protection of personal property and protection of freedom of thought and political expression". Thus, as Kirby J said in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd290, the Tasmanian legislation empowering the issue of an injunction in the circumstances of that case291 was not merely compatible with 287 Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 557 [239]; 376 ALR 575 at 637. 288 (2020) 94 ALJR 502 at 534 [124]; 376 ALR 575 at 606. 289 (1765) 19 St Tr 1029. 290 (2001) 208 CLR 199 at 282 [200]. 291 Supreme Court Civil Procedure Act 1932 (Tas), s 11(12). Edelman the representative democracy created by the Constitution, it was "a feature of that democracy". Non-human animal cruelty and the answers to the questions in the special case For many people, the motivations of the plaintiffs, which include elimination of cruelty to non-human animals, might be laudable. And one of the most compelling ways in which the plaintiffs can agitate for policy and social change in this area is publicising the type of shocking images exhibited in this case. But no matter how worthy that ultimate goal might be, it is not open in a representative democracy for this Court to deny the Parliament of New South Wales the ability to sanction trespassers and those complicit in the trespass in order to protect dignity, privacy, and security of property where the Parliament does so at the cost of only a small incursion upon freedom of political communication. Further, the answers given to the questions concerning freedom of political communication that are before this Court are neutral in their effect on protection of non-human animals. A search for truth in the marketplace of ideas cannot censor communication according to its content. A strong protection of freedom of speech has therefore been used in some cases in the United States with an effect that might positively erode the protection of non-human animals. In United States v Stevens292, a majority of the Supreme Court of the United States considered laws that criminalised the commercial creation, sale, or possession of visual or auditory depictions "in which a living animal is intentionally maimed, mutilated, tortured, wounded, or killed". The legislative background included evidence of a market for "crush videos" which depicted animals being crushed to death293. Despite the abhorrent nature of the content, the law was presumptively invalid because it proscribed speech based on content294. As Alito J said in dissent, the Supreme Court struck down "in its entirety a valuable statute ... that was enacted not to suppress speech, but to prevent horrific acts of animal cruelty"295. On the other hand, it has been suggested that the "same right to free speech would also prevent 292 (2010) 559 US 460. Cf United States v Richards (2014) 755 F 3d 269, from which an application for certiorari was refused: Richards v United States (2015) 135 S Ct 293 (2010) 559 US 460 at 465-466. 294 (2010) 559 US 460 at 468. 295 (2010) 559 US 460 at 482. Edelman [Congress] banning depictions of cruelty to animals by hunters or food producers"296. In a representative democracy, the best protection for non-human animals against cruelty is not the implied freedom of political communication. Putting to one side the prospect of any significant development of the common law, the best protection for non-human animals must come from Parliament. In New South Wales, one step has been the Prevention of Cruelty to Animals Act 1979 (NSW). That Act includes powers for inspectors to enter land without consent of the occupier in circumstances including the examination of an animal based on a suspicion, on reasonable grounds, that a person has committed an act of cruelty upon an animal, which includes unreasonable infliction of pain297. The questions in the special case, formulated by reference to accurate language, should be answered as follows: Question 1. Does s 11 of the Surveillance Devices Act impermissibly burden the implied freedom of political communication? Answer: Section 11 does not impermissibly burden the implied freedom of political communication in its application to the communication or publication by a person of a record or report of the carrying on of a lawful activity, at least where the person was complicit in the record or report being obtained exclusively by breach of s 8 of the Surveillance Devices Act. It is unnecessary to determine whether s 11 burdens the implied freedom of political communication in other applications. Question 2. If "yes" to Question 1, is s 11 of the Surveillance Devices Act [able to be partially disapplied] in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Answer: If s 11 were invalid in some of its operations, it could be partially disapplied to the extent of that invalidity. Otherwise, this question is unnecessary to answer. Question 3. Does s 12 of the Surveillance Devices Act impermissibly burden the implied freedom of political communication? Answer: Section 12 does not impermissibly burden the implied freedom of political communication in its application to the possession by a person of a record 296 Barnett and Gans, Guilty Pigs (2022) at 274. 297 Prevention of Cruelty to Animals Act 1979 (NSW), s 24E(1), s 24I(a) read with ss 5(1) and 4(2). Edelman of the carrying on of a lawful activity, at least where the person was complicit in the record being obtained exclusively by breach of s 8 of the Surveillance Devices Act. It is unnecessary to determine whether s 12 burdens the implied freedom of political communication in other applications. Question 4. If "yes" to Question 3, is s 12 of the Surveillance Devices Act [able to be partially disapplied] in respect of its operation upon political communication pursuant to s 31(2) of the Interpretation Act 1987 (NSW)? Answer: If s 12 were invalid in some of its operations, it could be partially disapplied to the extent of that invalidity. Otherwise, this question is unnecessary to answer. Question 5. Who should pay costs? Answer: The plaintiffs should pay the defendant's costs. STEWARD J. I respectfully and generally agree with the reasons of Kiefel CJ and Keane J as well as those of Edelman J. In the circumstances of this case, ss 11 and 12 of the Surveillance Devices Act 2007 (NSW) are valid laws. I agree with the answers proposed by Edelman J to the questions posed by the Amended Special Case. In this case, and on the assumption that the implied freedom of political communication may fetter the legislative power of a State298, the justification for ss 11 and 12 is also buttressed by the presence of legislation in New South Wales designed to protect animals from cruelty, such as the Prevention of Cruelty to Animals Act 1979 (NSW) ("the POCA Act") and the Companion Animals Act 1998 (NSW). Relevantly, inspectors in New South Wales have the power, in defined circumstances, to enter land to prevent cruelty to animals (s 24E of the POCA Act), to seek search warrants to enter and search land (s 24F of the POCA Act), to examine an animal (s 24I of the POCA Act), and to give a person a written notice requiring that person to take specified action in relation to an affected animal to avoid any further contravention (s 24N of the POCA Act). That legislation provides context legitimately to be considered in assessing the legislative choices reflected in ss 11 and 12. 298 cf Twomey, "The Application of the Implied Freedom of Political Communication to State Electoral Funding Laws" (2012) 35 University of New South Wales Law Journal 625 at 626. See also LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 554-556 [298]-[304]; 391 ALR 188 at 267-269. Gleeson 271 GLEESON J. I respectfully agree with the principles stated by Kiefel CJ and Keane J concerning the requirement for justification of a statutory provision having the effect of burdening the implied freedom of political communication, and the structured proportionality analysis by which such a statutory provision may be justified. Otherwise, I agree with Gageler J as to the scope of the question for judicial determination. The general principle, stated in Knight v Victoria299, is that a party who seeks to challenge the constitutional validity of a statutory provision will generally be confined to advancing grounds which bear upon the provision's validity "in its application to that party"300. The general principle confines a party to challenging provisions that have some operation in relation to that party301, and to grounds of challenge that are not merely hypothetical302. Complicity in any contravention of s 8 of the Surveillance Devices Act 2007 (NSW) that led to a contravention of ss 11 and 12 is not an element of the offences stated in ss 11 and 12. For the reasons given by Gageler J, Farm Transparency's past complicity in a contravention of s 8 does not provide a basis for confining the enquiry in this special case to whether the constraints purportedly imposed by ss 11 and 12 are valid in the narrow circumstance that the person said to contravene either of those provisions was complicit in the contravention of s 8. On the facts of Farm Transparency's pattern of activities presented in the special case, the question that falls for determination is a broader one. It is whether ss 11 and 12 validly operate to prohibit the possession, communication and publication of matter generated in contravention of s 8. Gageler J's reasons sufficiently explain why the prohibitions in ss 11 and 12 infringe the constitutional guarantee of political communication by lacking an adequate balance between the benefit sought to be achieved by the provisions and their adverse effect on the implied freedom. I agree with his Honour as to the proper construction of ss 11 and 12 consequent upon the conclusion that the provisions infringe the constitutional guarantee. Accordingly, I agree with his Honour's proposed answers to the questions in the special case. 299 (2017) 261 CLR 306. 300 Knight (2017) 261 CLR 306 at 325 [33]. 301 The Real Estate Institute of NSW v Blair (1946) 73 CLR 213 at 227. 302 cf Knight (2017) 261 CLR 306 at 324-325 [31]-[33].
HIGH COURT OF AUSTRALIA AND APPELLANT MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS RESPONDENT Applicant S v Minister for Immigration and Multicultural Affairs [2004] HCA 25 27 May 2004 1. Appeal allowed with costs. ORDER 2. Set aside the orders of the Full Court of the Federal Court made on 21 August 2002 and, in lieu thereof, order that the appeal to the Full Court of the Federal Court be dismissed with costs. On appeal from the Federal Court of Australia Representation: M D Howard for the appellant (instructed by Minter Ellison) J Basten QC with P R Macliver for the respondent (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Applicant S v Minister for Immigration and Multicultural Affairs Immigration – Refugees – Application for protection visa – Well-founded fear of persecution for reason of membership of particular social group – Particular social group identified as able-bodied young men from Afghanistan – Whether member of a particular social group – Whether Afghan society must perceive the particular social group – Whether well-founded fear of persecution – Whether enmity or malignity necessary to establish persecution – Whether facts reveal law of general application – Whether implementation of law of general application can amount to persecution – Whether implementation of ad hoc policy can amount to persecution. Words and phrases: "Particular social group", "well-founded fear of persecution", "law of general application", "legitimate national objective". Migration Act 1958 (Cth), s 36(2). GLEESON CJ, GUMMOW AND KIRBY JJ. Introduction This appeal turns upon the provisions of the Migration Act 1958 (Cth) ("the Act") respecting the issue of protection visas. It is common ground that the appeal is to be determined by reference to the legislation as it stood before the commencement of the Migration Legislation Amendment Act (No 6) 2001 (Cth). Section 36(1) of the Act provides that there is a class of visas to be known as protection visas. Section 36(2) provides that a criterion for a protection visa is that the applicant for the visa is: "a non-citizen in Australia to whom Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol". If, after considering a valid application for a protection visa, the Minister is satisfied that this criterion and any other requirements spelled out in par (a) (for example, health requirements) of s 65(1) of the Act are met, the Minister is to grant the visa. The expression "a non-citizen in Australia to whom Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol" picks up the definition of "refugee" in Art 1A(2) of these international instruments ("the Convention"), which relevantly provides: "[Any person who] owing to well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion, is outside the country of his nationality and is unable or, owing to such fear, is unwilling to avail himself of the protection of that country". The issues in this appeal raise two questions respecting the construction and application of the Convention definition. First, the criteria to be applied in order to determine whether the appellant was a member of a particular social group; and, secondly, whether the appellant could be considered to have a well-founded fear of being persecuted. The second question was raised for the first time by the Minister before this Court. Both questions, but particularly the first, involve consideration of what was decided in earlier decisions of this Court and the grounds for those decisions. Kirby The cases are Applicant A v Minister for Immigration and Ethnic Affairs1, Chen Shi Hai v Minister for Immigration and Multicultural Affairs2, Minister for Immigration and Multicultural Affairs v Yusuf3 and Minister for Immigration and Multicultural Affairs v Khawar4. It is necessary to approach the judgments in those cases with an appreciation of the procedural setting in which they reached this Court and the actual outcomes which were achieved. Facts and litigation The appellant is a married Afghan male of Pashtun ethnicity, from Malizo village of Gizab district in Orozgan province, Afghanistan. The appellant's wife, father, mother and four brothers remain in the village. He was born in 1980, and arrived in Australia on 11 July 2000 by boat. On 25 July 2000 the appellant applied for a protection visa. On 5 September 2000 the Minister's delegate refused the appellant's application. The appellant sought review of the delegate's decision by the Refugee Review Tribunal ("the Tribunal"). On 4 January 2001, the Tribunal affirmed the delegate's decision5. Both the Minister's delegate and the Tribunal accepted that the appellant's reason for leaving Afghanistan was to avoid the Taliban who were recruiting for military service. The Taliban had tried twice forcibly to recruit the appellant. On the first occasion, the appellant avoided recruitment by paying off the recruiters. On the second occasion, the appellant told the recruiters that he needed to speak to his parents. He then departed immediately from Afghanistan with the assistance of a people smuggler. Although not dealing expressly with whether the appellant had a well-founded fear of persecution, the Tribunal did find that the appellant "may face serious harm" as a result of conscription (it was also accepted that the (1997) 190 CLR 225. (2000) 201 CLR 293. (2001) 206 CLR 323. (2002) 210 CLR 1. 5 Refugee Review Tribunal, Decision and Reasons for Decision, ref N00/35095 at Kirby appellant had a well-founded fear of harm). This issue was given considerable attention during oral argument before this Court. The Tribunal accepted that many young men in Afghanistan had been recruited by the Taliban. The Taliban practised ad hoc, random, forcible recruitment of young men, where the only apparent criterion for recruitment was that the young men be able-bodied. This was borne out by both the country information accepted by the Tribunal and the fact that the appellant's brother was not recruited because he was not able-bodied. The Tribunal also noted that thousands of young men had left Afghanistan to avoid recruitment by the Taliban. The Tribunal's reasons for rejecting the appellant's claim appear from the "The nature of the recruitment process is such that there are no criteria for selection save being able-bodied and, being in the wrong place at the wrong time. By his own account he was approached in an ad hoc recruitment drive and, I also find that the recruiters in that exercise were not seriously concerned whether he did fight or not as they were equally content with being paid to allow him to avoid the recruitment drive. When the second group came they took no action when he said he wanted to speak to his parents first and indicated that he may also pay them. Given the Taliban's rigid approach to compliance this action leads me to conclude they were not concerned about the Applicant who had no skills or any significant value to them apart from his youth and the fact he was able-bodied. No immediate follow-up occurred and he was not required to report to them. This leads me to conclude that he was not targeted to the extent that he was listed or registered for recruitment by the Taliban but was merely seen as a young man who was available in that area at that time and, in the random manner of such an ad hoc drive he was able to avoid recruitment for a second time." (emphasis added) 6 Refugee Review Tribunal, Decision and Reasons for Decision, ref N00/35095 at Kirby The key to this passage is in the final paragraph, which discloses the Tribunal's conclusion that the appellant was not targeted by reasons of any political opinion or religious beliefs (ie, he was not "listed or registered for recruitment"). On review by the Federal Court7, Carr J (with respect, correctly) understood the reasons to indicate that the Tribunal had not considered whether the appellant was a member of a "particular social group"8, and whether he was persecuted by reason of his membership of that group9. His Honour said that the facts presented the potential for such a case, and thus the Tribunal should have considered whether able-bodied young men (or possibly able-bodied young men without the financial means to buy-off the conscriptors) comprised a particular social group within the meaning of the Convention10. Accordingly, Carr J ordered that the Tribunal's decision be set aside and the matter be remitted to it for redetermination according to law11. The Minister appealed to the Full Court of the Federal Court (Whitlam and Stone JJ; North J dissenting)12 which allowed the appeal. Stone J, with whom Whitlam J agreed13, concluded14: "In this case, however (unlike the position in Khawar), I can find no trace of any evidence before the Tribunal that would support a claim that Afghan society perceived young able-bodied men as comprising a separate group either as a result of the Taliban's recruitment process or for any other reason. In my view there is nothing to distinguish this case from that considered by the Full Court in [Minister for Immigration and Multicultural Affairs v] Applicant Z." (emphasis added) 7 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA [2001] FCA 1411 at [19]. [2001] FCA 1411 at [19]. 10 [2001] FCA 1411 at [48]. 11 [2001] FCA 1411 at [55]. 12 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR 13 (2002) 124 FCR 256 at 257. 14 (2002) 124 FCR 256 at 275. Kirby In Applicant Z15, the Full Court (Sackville, Kiefel and Hely JJ) was concerned with an Afghan applicant in a position substantially the same as that of the appellant in this case. Sackville J identified as an "insuperable obstacle" the absence of material before the Tribunal that would have justified it in finding that Afghan society, or some clearly identifiable section of it, perceived "able-bodied Afghan men" as a distinct social unit16. The appellant's primary ground of appeal in this Court is that the majority of the Full Court erred in requiring that there be evidence that Afghan society perceived young able-bodied men to comprise a particular social group, before the Tribunal was obliged to consider whether the appellant was a member of that group. The appellant contended that Afghan society's perceptions of whether there is a particular social group is relevant to the question of whether there is such a particular social group, but it is not a requirement. That submission should be upheld. We turn to indicate why this is so. Perception of "particular social group" The requirement that Afghan society must perceive young able-bodied men as comprising a particular social group is derived from the reasoning in an earlier unanimous decision of the Full Court of the Federal Court in Minister for Immigration and Multicultural Affairs v Zamora17. That case concerned a protection visa applicant from Ecuador who sought protection in Australia on the basis of harassment (including both threats and physical and sexual assault) suffered by her at the hands of criminal gangs in Quito, the capital of Ecuador. The Full Court (Black CJ, Branson and Finkelstein JJ) affirmed the decision of the Tribunal denying the protection visa application. The applicant had claimed that it was a common experience for criminal gangs to attempt to recruit tourist guides to help steal from tourists. After discussing the various reasonings adopted by the members of this Court in Applicant A, their Honours stated18: "In our view Applicant A's case is authority for the following propositions. To determine that a particular social group exists, the putative group must be shown to have the following features. First, there must be some characteristic other than persecution or the fear of 15 (2001) 116 FCR 36. 16 (2001) 116 FCR 36 at 40. 17 (1998) 85 FCR 458. 18 (1998) 85 FCR 458 at 464. Kirby persecution that unites the collection of individuals; persecution or fear of it cannot be a defining feature of the group. Second, that characteristic must set the group apart, as a social group, from the rest of the community. Third, there must be recognition within the society that the collection of individuals is a group that is set apart from the rest of the community." The second and third propositions appear to require an objective and then subjective assessment of the position of the group within the community. The third proposition is subjective in that it relies upon recognition by, or the perceptions of, the rest of the community. The "third proposition" outlined by the Full Court in Zamora, and the subsequent holding in Applicant Z, reflects an understanding in the Full Court of remarks by McHugh J in his judgment in Applicant A. Accordingly, it is necessary to turn to that case. Applicant A The applicants in Applicant A, a married couple, arrived in Australia in 1993 and their child was born shortly thereafter. They claimed refugee status on the basis that, if they were returned to their country of nationality, China, they would face enforcement of the "one child policy" by sterilisation. They argued that this amounted to a fear of persecution by reason of membership of a particular social group, namely, persons desiring to be parents of more than one child. The Tribunal decided that the applicants answered the Convention definition. In the Federal Court, Sackville J dismissed an application by the Minister under the Administrative Decisions (Judicial Review) Act 1977 (Cth)19, but the Full Court allowed the Minister's appeal and set aside the Tribunal's decision20. This Court supported that outcome and, by a majority (Dawson, McHugh and Gummow JJ; Brennan CJ and Kirby J dissenting) dismissed the appeal to it. The Full Court had treated the issue respecting the "one child policy" as posing a question of law of the construction of the expression 19 Minister for Immigration and Ethnic Affairs v Respondent A (1994) 127 ALR 383. 20 Minister for Immigration and Ethnic Affairs v Respondent A (1995) 57 FCR 309 at Kirby "membership of a particlar social group" in the Convention definition21 and this Court proceeded on the same basis. A majority of this Court accepted what became the "first proposition" in Zamora, that a "particular social group" must be identifiable by a characteristic or attribute common to all members of the group, but that characteristic cannot be the fear of persecution itself22. This proposition can be split into two parts. The first part amounts to a general principle that there must be a common characteristic or attribute and the second part can be characterised as a limitation on the general principle. The limitation was explained by McHugh J as "[P]ersons who seek to fall within the definition of 'refugee' in Art 1A(2) of the Convention must demonstrate that the form of persecution that they fear is not a defining characteristic of the 'particular social group' of which they claim membership. If it were otherwise, Art 1A(2) would be rendered illogical and nonsensical. It would mean that persons who had a well-founded fear of persecution were members of a particular social group because they feared persecution. The only persecution that is relevant is persecution for reasons of membership of a group which means that the group must exist independently of, and not be defined by, the persecution." (footnote omitted) (emphasis added) The apparent circularity in the emphasised passage was further considered by Dawson J24: "There is more than a hint of circularity in the view that a number of persons may be held to fear persecution by reason of membership of a particular social group where what is said to unite those persons into a particular social group is their common fear of persecution. A group thus defined does not have anything in common save fear of persecution, and allowing such a group to constitute a particular social group for the purposes of the Convention 'completely reverses the statutory definition of 21 (1995) 57 FCR 309 at 315-316. 22 Applicant A v Minister for Immigration and Ethnic Affairs (1997) 190 CLR 225 at 241-243 per Dawson J, 263 per McHugh J, 285-286 per Gummow J. 23 (1997) 190 CLR 225 at 263; see also at 242 per Dawson J, 286 per Gummow J. 24 (1997) 190 CLR 225 at 242. Kirby Convention refugee in issue (wherein persecution must be driven by one of the enumerated grounds and not vice versa)'." (footnote omitted) It is worth noting that the limitation later was accepted and applied by the House of Lords in R v Immigration Appeal Tribunal; Ex parte Shah25. In Applicant A, after expressing the general principle and limitation, "Nevertheless, while persecutory conduct cannot define the social group, the actions of the persecutors may serve to identify or even cause the creation of a particular social group. Left-handed men are not a particular social group. But, if they were persecuted because they were left-handed, they would no doubt quickly become recognisable in their society as a particular social group. Their persecution for being left-handed would create a public perception that they were a particular social group. But it would be the attribute of being left-handed and not the persecutory acts that would identify them as a particular social group." It will be convenient later in these reasons to return to consider the example of left-handed men. McHugh J continued27: "The fact that the actions of the persecutors can serve to identify or even create 'a particular social group' emphasises the point that the existence of such a group depends in most, perhaps all, cases on external perceptions of the group. The notion of persecution for reasons of membership of a particular social group implies that the group must be identifiable as a social unit. Only in the 'particular social group' category is the notion of 'membership' expressly mentioned. The use of that term in conjunction with 'particular social group' connotes persons who are defined as a distinct social group by reason of some characteristic, attribute, activity, belief, interest or goal that unites them. If the group is perceived by people in the relevant country as a particular social group, it will usually but not always be the case that they are members of such a group. Without some form of internal linking or unity of characteristics, attributes, activities, beliefs, interests or goals, 25 [1999] 2 AC 629 at 639-640 per Lord Steyn, 656 per Lord Hope of Craighead, 662 per Lord Millett (dissenting). 26 (1997) 190 CLR 225 at 264. 27 (1997) 190 CLR 225 at 264. Kirby however, it is unlikely that a collection of individuals will or can be perceived as being a particular social group." (italicised emphasis in original, bold emphasis added) It was from this passage that the Full Court in Zamora extracted the third proposition to which reference has been made. Two propositions are to be taken from McHugh J's remarks. First, in some circumstances it is possible for a particular social group to be created by the persecutory conduct such that it can no longer be said that the group is "defined" by the persecutory conduct. His Honour expressed this in a temporal sense. Secondly, given that the actions of the persecutors may identify or even create the group, what may be critical in most, and perhaps all, cases is the perception of the group by others ("external perceptions"). This is further explained by the example that if the group is perceived by the community in the relevant country as a particular social group, then usually, but not always, the particular social group can be taken to have been created. By contrast, Brennan CJ (dissenting as to the outcome) and Dawson J appear to express a similar principle by construing the phrase "particular social group". After construing a "particular group" as a group identifiable by any characteristic common to the members of the group (ie, the general principle referred to above), Brennan CJ said28: "[A] 'social group' is a group the members of which possess some characteristic which distinguishes them from society at large". (emphasis added) In the same vein, Dawson J stated29: "The word 'particular' in the definition merely indicates that there must be an identifiable social group such that a group can be pointed to as a particular social group. A particular social group, therefore, is a collection of persons who share a certain characteristic or element which unites them and enables them to be set apart from society at large. That is to say, not only must such persons exhibit some common element; the element must unite them, making those who share it a cognisable group within their society." (footnote omitted) (emphasis added) 28 (1997) 190 CLR 225 at 234. 29 (1997) 190 CLR 225 at 241. Kirby Kirby J made a similar point in Applicant A by pointing out that the text, its history and the many "groups" recognised as falling within the Convention in this and other countries denied any suggestion that there must be "an associational participation or even consciousness of such group membership"30. Putting these statements together with the second proposition stated by McHugh J, it is apparent that his Honour was adopting no different approach to the Convention definition to that adopted by Brennan CJ and Dawson J, albeit expressing it in other terms. His Honour was expanding on the requirement that the existence of a particular social group requires that the group be distinguished or set apart from society at large. One way in which this may be determined is by examining whether the society in question perceives there to be such a group. Thus, perceptions held by the community may amount to evidence that a social group is a cognisable group within the community. The general principle is not that the group must be recognised or perceived within the society, but rather that the group must be distinguished from the rest of the society. Khawar Another way of expressing the same principle, or the application of the same principle, is illustrated by a reading of Khawar31. The first respondent in that case, a married Pakistani woman, claimed to have suffered persecution by reason of her membership of the particular social group comprising married Pakistani women (other formulations were also offered). The persecution claimed was the failure of the Pakistani authorities to protect her from violence committed against her by her husband. The Minister, the appellant in Khawar, sought to have overturned decisions of the Federal Court at first instance and on appeal which had set aside the decision of the Tribunal rejecting the claims for protection visas. The Minister in this Court submitted that the withholding of police protection to Mrs Khawar, as mere inactivity, could not itself amount to persecution, whatever the definition of the social group in Pakistan to which she belonged32. That argument was not accepted. The outcome was that the matter was sent back to the Tribunal for the making of further findings33. 30 (1997) 190 CLR 225 at 309. 31 (2002) 210 CLR 1. 32 (2002) 210 CLR 1 at 3-4. 33 (2002) 210 CLR 1 at 14 [36], 29 [88], 44 [131]. Kirby On first blush, the claimed particular social group in Khawar appears to be defined solely by reference to the persecutory conduct (ie, the failure of the Pakistani authorities to enforce the criminal law). However, a majority of the Court (Gleeson CJ, McHugh, Gummow and Kirby JJ; Callinan J dissenting) concluded that it would be open to the Tribunal to find that the first respondent was a member of a particular social group34. After acknowledging the limitation accepted by the majority of the Court in Applicant A, McHugh and Gummow JJ emphasised the operation of cultural, social, religious and legal factors, rather than any perceptions held by the community, as determining that married Pakistani women were a group that was distinguished or set apart from the rest of the community35. Their Honours said36: "Those considerations [ie, the limitation] do not control the present case. The membership of the potential social groups which have been mentioned earlier in these reasons would reflect the operation of cultural, social, religious and legal factors bearing upon the position of women in Pakistani society and upon their particular situation in family and other domestic relationships. The alleged systemic failure of enforcement of the criminal law in certain situations does not dictate the finding of membership of a particular social group." (emphasis added) Left-handed men The example of left-handed men given by McHugh J in Applicant A37 indicates how it is possible that over time, due to the operation of social and legal factors prevailing in the community, persons with such a characteristic may be considered to hold a certain position in that community (his Honour's first proposition). Left-handed men share a common attribute (ie, they are left- handed), but, ordinarily, there is nothing to separate or to distinguish them from the rest of the community. However, to expand on his Honour's example, if the 34 (2002) 210 CLR 1 at 13 [32], 28 [83], 43 [127]. 35 The House of Lords in Shah were explicit, referring to the "institutionalised discrimination" of women in Pakistan: [1999] 2 AC 629 at 645 per Lord Steyn, 635 per Lord Hoffmann, 658 per Lord Hope. In other words, their Lordships concluded that, viewed from an objective perspective, discrimination against the social group appeared to be culturally and socially acceptable. 36 (2002) 210 CLR 1 at 28 [83]; see also at 44 [130] per Kirby J. 37 (1997) 190 CLR 225 at 264. Kirby community's ruling authority were to legislate in such a way that resulted in discrimination against left-handed men, over time the discriminatory treatment of this group might be absorbed into the social consciousness of the community. In these circumstances, it might be correct to conclude that the combination of legal and social factors (or norms) prevalent in the community indicate that left-handed men form a particular social group distinguishable from the rest of the community. The decision in Chen38 may also be understood in this way. Gleeson CJ, Gaudron, Gummow and Hayne JJ concluded that children born in contravention of China's "one child policy" could constitute a group defined other than by reference to the discriminatory treatment or persecution they feared39. To reach this conclusion, their Honours relied on the Tribunal's finding that a "child is a 'black child' irrespective of what persecution may or may not befall him or her"40. Kirby J41 emphasised that the membership by the children of the particular social group was defined not by anything they had done but by the "wrongdoing" of their parents. In Chen, the Tribunal had found that "black children" were a "particular social group" within the meaning of the Convention definition, but had held against the applicant on other grounds. In the Full Court, it had been held by the majority that such children could not, as a "pure question of law", constitute such a group because they were defined by reference to the persecutory conduct liable to be suffered by their members. The effect of the orders of this Court was that the matter was remitted to the Tribunal to be dealt with on the basis that the appellant was entitled to refugee status42. There is no reason in principle why cultural, social, religious and legal norms cannot be ascertained objectively from a third-party perspective. Communities may deny the existence of particular social groups because the common attribute shared by members of the group offends religious or cultural 38 (2000) 201 CLR 293. 39 (2000) 201 CLR 293 at 302 [23]. 40 (2000) 201 CLR 293 at 302 [22]. 41 (2000) 201 CLR 293 at 318 [74]. 42 (2000) 201 CLR 293 at 306-307 [42]-[43]. Kirby beliefs held by a majority of the community43. Those communities do not recognise or perceive the existence of the particular social group, but it cannot be said that the particular social group does not exist. The third-party perspective is a common feature in the decision-making by the Tribunal and by the delegates of the Minister. Decisions made by these decision-makers may rely on "country information" gathered by international bodies and nations other than the applicant's nation of origin. Such information often contains opinions held by those bodies or governments of those nations44. From this information it is permissible for the decision-maker to draw conclusions as to whether the group is cognisable within the community. Such conclusions are clearly objective. However, as accepted by McHugh J in Applicant A, subjective perceptions held by the community are also relevant. Conclusions as to "particular social group" Therefore, the determination of whether a group falls within the definition of "particular social group" in Art 1A(2) of the Convention can be summarised as follows. First, the group must be identifiable by a characteristic or attribute common to all members of the group. Secondly, the characteristic or attribute common to all members of the group cannot be the shared fear of persecution. Thirdly, the possession of that characteristic or attribute must distinguish the group from society at large. Borrowing the language of Dawson J in Applicant A45, a group that fulfils the first two propositions, but not the third, is merely a "social group" and not a "particular social group". As this Court has repeatedly emphasised, identifying accurately the "particular social group" alleged is vital for the accurate application of the applicable law to the case in hand46. 43 cf Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 78 ALJR 180 at 185 [25], [30], 193 [69], 196-197 [96], 197-198 [98]; 203 ALR 112 at 118, 119, 129, 135, 136. 44 The Tribunal in this matter referred to reports of international bodies, the Commonwealth Department of Foreign Affairs and Trade and the United States State Department. 45 (1997) 190 CLR 225 at 241. 46 See, eg, Dranichnikov v Minister for Immigration and Multicultural Affairs (2003) 77 ALJR 1088 at 1099 [72] per Kirby J; 197 ALR 389 at 404. Kirby Persecution The Minister made two related submissions regarding the issue of persecution. First, the Minister submitted that forcible recruitment by the Taliban does not amount to persecution under the Convention, because, although there may be a foreseeable risk of harm47, the critical element of enmity or malignity is absent; the regime merely sought to harness the valued resource of those capable of fighting rather than inflict harm upon the individuals conscripted. Those conscripted, so it was submitted, may die or suffer harm in the fighting, but the purpose of the regime is not to rid itself of young men. This submission should not be accepted. Chen decided that persecution can proceed from reasons other than "enmity" and "malignity"48. From the perspective of those responsible for discriminatory treatment, the persecution might in fact be motivated by an intention to confer a benefit49. This in itself does not remove the spectre of persecution. Secondly, during oral argument the Minister sought to apply the decision in Minister for Immigration and Multicultural Affairs v Israelian50. The applicant in that case was an Armenian national who was refused a protection visa by the delegate of the Minister. Before the Tribunal, the applicant stated that he had been absent from Armenia when called up for national service. The Tribunal refused the application without expressing any finding as to whether the applicant could be considered a member of a particular social group expressed as draft evaders. In concluding that the applicant was not a member of a particular social group comprised of either or both deserters and draft evaders, McHugh, Gummow and Hayne JJ found that the Tribunal had not committed an error of law and concluded51: 47 Chen Shi Hai v Minister for Immigration and Multicultural Affairs (2000) 201 CLR 293 at 304 [33]. 48 (2000) 201 CLR 293 at 305 [35], 311-312 [60]. 49 (2000) 201 CLR 293 at 305 [35]. 50 (2001) 206 CLR 323, heard together with Minister for Immigration and Multicultural Affairs v Yusuf. 51 (2001) 206 CLR 323 at 354-355 [97]; see also at 342 [55] per Gaudron J; cf at 380 [183] per Kirby J dissenting. Kirby "that there would not be persecution of Mr Israelian if he returned to his country of nationality, only the possible application of a law of general application". Law of general application In the present appeal, the Minister submitted that the facts here also reveal "a law of general application" and therefore the conclusion in Israelian must follow. This is not the case. There was no evidence before the Tribunal that the actions of the Taliban amounted to a law of general application. The policy of conscription was ad hoc and random. Further, what was said in Israelian does not establish a rule that the implementation of laws of general application can never amount to persecution. It could scarcely be so given the history of the Nuremberg Laws against the Jews enacted by Nazi Germany which preceded, and help to explain, the purposes of the Refugees Convention. Rather, the Court majority determined that, on the facts of that case, it had been open to the Tribunal to conclude that the implementation by Armenia of its laws of general application was not capable of resulting in discriminatory treatment. A law of general application is capable of being implemented or enforced in a discriminatory manner. The criteria for the determination of whether a law or policy that results in discriminatory treatment actually amounts to persecution were articulated by McHugh J in Applicant A. His Honour said that the question of whether the discriminatory treatment of persons of a particular race, religion, nationality or political persuasion or who are members of a particular social group constitutes persecution for that reason ultimately depends on whether that treatment is "appropriate and adapted to achieving some legitimate object of the country [concerned]"52. These criteria were accepted in the joint judgment of Gleeson CJ, Gaudron, Gummow and Hayne JJ in Chen53. As a matter of law to be applied in Australia, they are to be taken as settled. This is what underlay the Court's decision in Israelian. Namely, that enforcement of the law of general application in that particular case was appropriate and adapted to achieving a legitimate national objective. 52 (1997) 190 CLR 225 at 258. 53 (2000) 201 CLR 293 at 303 [28]. Kirby In Applicant A, McHugh J went on to say that a legitimate object will ordinarily be an object the pursuit of which is required in order to protect or promote the general welfare of the State and its citizens54. His Honour gave the examples that (i) enforcement of a generally applicable criminal law does not ordinarily constitute persecution; and (ii) nor is the enforcement of laws designed to protect the general welfare of the State ordinarily persecutory55. Whilst the implementation of these laws may place additional burdens on the members of a particular race, religion or nationality, or social group, the legitimacy of the objects, and the apparent proportionality of the means employed to achieve those objects, are such that the implementation of these laws is not persecutory. The joint judgment in Chen expanded on these criteria56: "Whether the different treatment of different individuals or groups is appropriate and adapted to achieving some legitimate government object depends on the different treatment involved and, ultimately, whether it offends the standards of civil societies which seek to meet the calls of common humanity. Ordinarily, denial of access to food, shelter, medical treatment and, in the case of children, denial of an opportunity to obtain an education involve such a significant departure from the standards of the civilised world as to constitute persecution. And that is so even if the different treatment involved is undertaken for the purpose of achieving some legitimate national objective." (emphasis added) That ultimate consideration points to the answer in the present case. The Taliban can be taken to have been the de facto authority in Afghanistan at the relevant time, but it does not necessarily follow that it pursued legitimate national objectives in the sense indicated above. An authority recognised by Australia and other states as the government de facto, if not de jure (to use the terminology which was employed in customary international law when the Convention was adopted57), of a state may pursue objects that offend 54 (1997) 190 CLR 225 at 258. 55 (1997) 190 CLR 225 at 258. 56 (2000) 201 CLR 293 at 303 [29]. 57 Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853 at 906, 957-958. In 1988, Australia abandoned the practice of formally recognising or withholding recognition of foreign governments; rather, relations, formal or informal, would be conducted "with new régimes to the extent and in the manner which may be required by the circumstances of each case": Starke, "The new (Footnote continues on next page) Kirby the standards of civil societies which seek to meet the calls of common humanity. Such regimes would also have been all too well known in Europe itself when the Convention was adopted. The traditional view that the recognising state was not concerned with the legality of the state of things it was recognising58 is not all that is involved here. The notion in the case law construing the "refugee" definition of a law of general application, given the nature of the Convention, involves more. The point may be seen in the discussion by Lord Wilberforce in Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2)59, with reference to Locke, of a government without laws as inconsistent with at least "a civilised and organised society" and by Lord Salmon in Oppenheimer v Cattermole60 and Lord Steyn in Kuwait Airways Corporation v Iraqi Airways Co (Nos 4 and 5)61 of arbitrary activities not deserving of recognition as a law at all. Although there was no material before the Tribunal indicating for exactly what purpose young men were being recruited, oral argument before this Court appeared to proceed on the basis that the new recruits were being sent to serve on the front-line of the Taliban's military operations. In other words, it could be said that the objective of the conscription policy was to protect the nation. Generally speaking, this is an entirely legitimate national objective62. However, in this case the position of the Taliban as an authority which was, according to the Tribunal, considered by international standards a ruthless and despotic political body founded on extremist religious tenets must affect the legitimacy of that object. Furthermore, assuming for a moment that the object was a legitimate national objective, it appears that the conduct of the Taliban could not have been considered appropriate and adapted, in the sense of proportionate in the means used to achieve that objective. The policy of conscription described by the Australian policy of recognition of foreign governments", (1988) 62 Australian Law Journal 390 at 390. See also Shaw, International Law, 5th ed (2003) at 58 Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853 at 957. 59 [1967] 1 AC 853 at 954. 60 [1976] AC 249 at 282-283. 61 [2002] 2 AC 883 at 1101-1102. 62 See, for example, Pt IV of the Defence Act 1903 (Cth), which is headed "LIABILITY TO SERVE IN THE DEFENCE FORCE IN TIME OF WAR". Kirby evidence was implemented in a manner that was random and arbitrary. According to the Tribunal, this would not be condoned internationally63. These conclusions by the Tribunal indicate that, had it by application of the correct principles respecting "perception" reached the stage of considering whether no more was involved than a law of general application, the Tribunal correctly would have concluded that the Taliban was not pursuing a "legitimate national objective" spoken of in Chen. Disposition of the appeal The majority of the Full Court erred in law by requiring that there had to be evidence before the Tribunal that would support the claim that Afghan society perceived young able-bodied men as comprising a separate group. Further, however, the Tribunal failed to consider the correct issue. This was whether because of legal, social, cultural and religious norms prevalent in Afghan society, young able-bodied men comprised a social group that could be distinguished from the rest of Afghan society. Given the correct issue was not considered, the evidence put before the Tribunal in respect of the position of young able-bodied men in Afghanistan was scant and related only to the Tribunal's finding that the Taliban appeared to be recruiting young men. The appeal should be allowed with costs, the orders of the Full Court set aside and in place thereof, the appeal to that Court should be dismissed with costs. The effect of these orders is to reinstate the order of Carr J that the Tribunal decision be set aside and the matter be remitted to it for redetermination according to law. It should be added that this appeal is disposed of at a time when there have been many changes to the situation which obtained in Afghanistan when the matter was last before the Tribunal. The significance to be attached to any further evidence to be placed before the Tribunal upon these matters will be for the Tribunal when it makes its fresh determination64. 63 The Taliban's policy did not allow for conscientious objectors. The Tribunal appeared to accept the appellant's claims that he was a pacifist and that he was not committed to the aims and objectives of the Taliban. 64 Minister for Immigration and Ethnic Affairs v Mayer (1985) 157 CLR 290; Chan v Minister for Immigration and Ethnic Affairs (1989) 169 CLR 379. McHugh 53 McHUGH J. This appeal raises once again the meaning of the indeterminate expression "a particular social group" in Art 1A(2) of the Convention relating to the Status of Refugees65 as amended by the Protocol relating to the Status of Refugees66 ("the Convention"). In particular, it raises the question whether proof of "a particular social group" requires evidence that the relevant society in which the group exists perceives the group to be a collection of individuals who are set apart from the rest of that society. Statement of the case The appeal is brought against an order of the Full Court of the Federal Court67 that allowed an appeal against an order of Carr J in the Federal Court68. Carr J ordered the Refugee Review Tribunal ("the Tribunal") to rehear an application for a protection visa on the ground that the Tribunal had not considered whether the appellant, Applicant S, was a member of "a particular social group". The appellant, an Afghan male who arrived in Australia in July 2000 aged 20, applied for a protection visa under s 36 of the Migration Act 1958 (Cth) ("the Act")69 on the ground that he was a refugee as defined in Art 1A(2) of the Convention: "[Any person who] owing to well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion, is outside the country of his nationality and is unable or, owing to such fear, is unwilling to avail himself of the protection of that country". The appellant claims that, if he were returned to Afghanistan, he would be persecuted for reasons of his membership of a particular social group. He 65 Opened for signature 28 July 1951, 189 UNTS 150 (entered into force 22 April 66 Opened for signature 31 January 1967, 606 UNTS 267 (entered into force 4 October 1967; entered into force for Australia 13 December 1973). 67 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR 68 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 69 The appeal is determined according to the legislation as it stood prior to the commencement of the Migration Legislation Amendment Act (No 6) 2001 (Cth). McHugh identifies the social group as "young, able-bodied Afghan men" and claims that, as a member of that group in Afghanistan, he would be subject to forcible conscription by the Taliban and required to fight in the Taliban army. A delegate of the Minister for Immigration and Multicultural Affairs refused his application for a protection visa. The Tribunal confirmed this decision70. The Tribunal found that the Taliban did not target the appellant71, that it conscripted soldiers on an ad hoc basis72 and that, if the appellant were returned to Afghanistan, he On an application to the Federal Court for judicial review of the Tribunal's decision, Carr J found that the Tribunal had failed to consider whether the appellant was a member of "a particular social group", and whether he was persecuted for reasons of his membership of that group74. Carr J remitted the matter to the Tribunal for rehearing. However, an appeal by the Minister to the Full Federal Court (Whitlam and Stone JJ, North J dissenting) succeeded75. Stone J said that she could76: "find no trace of any evidence before the Tribunal that would support a claim that Afghan society perceived young able-bodied men as comprising a separate group either as a result of the Taliban's recruitment process or for any other reason." 70 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM). 71 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [63]. References to particular paragraphs of the Tribunal's decision use the paragraph numbering system adopted by Carr J in Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411. 72 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [30]. 73 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [69]-[70]. 74 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 75 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR 76 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR McHugh Whitlam J said that, like Stone J, he could "find no evidence or material before the Tribunal which would support a claim that Afghan society perceived young able-bodied men as comprising a particular social group."77 Thus, the majority judges decided the case on the basis that there was no evidence before the Tribunal which could support the appellant's claim that Afghan society perceived young able-bodied men as comprising "a particular social group". Accordingly, the majority held that the Tribunal had not erred in law in reaching its decision confirming the delegate's refusal of the visa78. The Full Court's decision accorded with that of a differently composed Full Court in Minister for Immigration and Multicultural Affairs v Applicant Z79. Subsequently, this Court granted the appellant special leave to appeal against the order of the Full Court. Legislative framework Section 36(1) of the Act provides for a class of visas to be known as protection visas. Section 36(2) states that: "A criterion for a protection visa is that the applicant for the visa is a non- citizen in Australia to whom Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol." One class of non-citizen to whom Australia owes protection obligations is a person who has a well-founded fear that he or she will be "persecuted ... for reasons of race, religion, nationality, membership of a particular social group or political opinion".80 77 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR 78 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR 256 at 257 per Whitlam J, 275 per Stone J. 79 (2001) 116 FCR 36. In that case the Full Court (Sackville, Kiefel and Hely JJ) decided that there was insufficient evidence to require the Tribunal to consider whether able-bodied Afghan men constituted a particular social group (at 41 per Sackville J) or to justify the conclusion that there was a "public perception" in Afghan society, or some clearly identifiable section of it, that able-bodied Afghan men constituted a particular social group (at 40 per Sackville J, 45 per Hely J). 80 See s 36(3)-(5) of the Act. McHugh Meaning of "a particular social group" The appellant contends that the Full Court erred in requiring evidence that Afghan society perceived young, able-bodied Afghan men as comprising "a particular social group". In my opinion, this contention is correct. Although the Full Court did not expressly say so, its reasoning in the present case appears to be based on the reasoning in the earlier decision of Minister for Immigration and Multicultural Affairs v Zamora81. In Zamora, the Full Court of the Federal Court (Black CJ, Branson and Finkelstein JJ) extracted three propositions from the decision of this Court in Applicant A v Minister for Immigration and Ethnic Affairs. The Full Court said82: "First, there must be some characteristic other than persecution or the fear of persecution that unites the collection of individuals; persecution or fear of it cannot be a defining feature of the group. Second, that characteristic must set the group apart, as a social group, from the rest of the community. Third, there must be recognition within the society that the collection of individuals is a group that is set apart from the rest of the community." (emphasis added) In my opinion, the third of these propositions does not accurately state the effect of Applicant A. First, it is not necessary that "a particular social group" be recognised as a group that is set apart from the rest of society. Second, there is no requirement of a recognition or perception by the society in which the group exists, or some clearly identifiable section of that society, that the collection of individuals comprises "a particular social group". To qualify as "a particular social group", the group must be a cognisable group within the relevant society, but it is not necessary that it be recognised as a group that is set apart from the rest of that society. In Applicant A, Dawson J said83: "A particular social group, therefore, is a collection of persons who share a certain characteristic or element which unites them and enables them to be set apart from society at large. That is to say, not only must such persons exhibit some common element; the element must unite them, making those who share it a cognisable group within their society." (emphasis added, footnote omitted) 81 (1998) 85 FCR 458. See also Applicant Z (2001) 116 FCR 36 at 40 per Sackville J. 82 Zamora (1998) 85 FCR 458 at 464. 83 (1997) 190 CLR 225 at 241. McHugh This passage indicates that, for a group of persons to be "a particular social group", it must be cognisable within the society in which the group exists. Nothing in the statement of Dawson J suggests, however, that the relevant society must itself recognise that the group is a group that is set apart from the rest of that society. A number of factors points to the necessity of the group being cognisable within the society. Given the context in which the term "a particular social group" appears in Art 1A(2) of the Convention, the members of the group, claimed to be a particular social group, must be recognised by some persons – at the very least by the persecutor or persecutors – as sharing some kind of connection or falling under some general classification. That follows from the fact that a refugee is a person who has a "well-founded fear of being persecuted for reasons of ... membership of a particular social group". A person cannot have a well-founded fear of persecution within the meaning of Art 1A(2) of the Convention unless a real chance exists that some person or persons will persecute the asylum-seeker for being a member of a particular class of persons that is cognisable – at least objectively – as a particular social group. The phrase "persecuted for reasons of ... membership" implies, therefore, that the persecutor recognises certain individuals as having something in common that makes them different from other members of the society. It also necessarily implies that the persecutor selects the asylum-seeker for persecution because that person is one of those individuals. But it does not follow that the persecutor or anyone else in the society must perceive the group as "a particular social group". The group must in fact be a social group, however, and it must be a particular social group. It is not enough that its members form a demographic division of the relevant society, such as people aged 33 or those earning above or below a certain amount per annum. As Gummow J pointed out in Applicant A84, the words "particular" and "social" indicate that the term "a particular social group" "is not apt to encompass every broadly defined segment of those sharing a particular country of nationality." A demographic division of persons may constitute a group because, for statistical or recording purposes, those persons may be properly classified or considered together. Nevertheless, such a group of persons is not necessarily "a particular social group" within the meaning of Art 1A(2) of the Convention. Many demographic groups may constitute "a particular social group" for the purposes of the Convention. Aged persons, for example, are a demographic division and in many – probably most – societies are also generally regarded as a particular social group. However, that is because aged persons are perceived both within those societies and by those living outside those societies as having a recognisable and independent social presence. 84 (1997) 190 CLR 225 at 284-285. McHugh In formulating the third of three propositions in Zamora, the Full Court relied on a passage in my judgment in Applicant A, where I said85: "The fact that the actions of the persecutors can serve to identify or even create 'a particular social group' emphasises the point that the existence of such a group depends in most, perhaps all, cases on external perceptions of the group. The notion of persecution for reasons of membership of a particular social group implies that the group must be identifiable as a social unit. Only in the 'particular social group' category is the notion of 'membership' expressly mentioned. The use of that term in conjunction with 'particular social group' connotes persons who are defined as a distinct social group by reason of some characteristic, attribute, activity, belief, interest or goal that unites them. If the group is perceived by people in the relevant country as a particular social group, it will usually but not always be the case that they are members of such a group. Without some form of internal linking or unity of characteristics, attributes, activities, beliefs, interests or goals, however, it is unlikely that a collection of individuals will or can be perceived as being a particular social group. (emphasis in bold added) It would be a mistake to see the emphasised sentence in this passage as asserting that "a particular social group" does not exist unless it is always perceived as such by the society in which it exists. Evidence of such a perception on the part of that society is usually compelling evidence that the relevant group is "a particular social group" in that country. That does not mean, however, that for the purposes of Art 1A(2) of the Convention, the society in which the group exists must recognise the group as a group that is set apart from the rest of the community. To require evidence of a recognition or perception by the society that the collection of individuals in that society comprises "a particular social group" is to impose a condition that the Convention does not require. A "particular social group" may exist although it is not recognised or perceived as such by the society in which it exists. For example, those who form the "particular social group" may be perceived by the society in which the group exists as aberrant individuals and may even be described by a particular name, yet the society may not perceive these individuals as constituting a particular social group. Nevertheless, those living outside that society may easily recognise the individuals concerned as comprising a particular social group. No doubt such cases are likely to be rare. That they exist, however, is shown by cases such as Appellant S395/2002 v Minister for Immigration and Multicultural Affairs; Appellant S396/2002 85 (1997) 190 CLR 225 at 264. McHugh v Minister for Immigration and Multicultural Affairs86. The evidence in those cases suggested that Bangladesh society prefers to deny the existence of homosexuality within that society87. On the other hand, there was evidence that police, hustlers and others in that society singled homosexuals out for discriminatory they were homosexuals88. Both the Tribunal and this Court accepted in Appellant S395/2002 and Appellant S396/2002 that homosexuals in Bangladesh are a particular social group89. Objectively, homosexuals in Bangladesh society comprise "a particular social group", whether or not that society recognises them as such. to persecution because treatment amounting Thus, although the group must be a cognisable group within the society, it is not necessary that it be recognised generally within the society as a collection of individuals which constitutes a group that is set apart from the rest of the community. To qualify as a particular social group, it is enough that objectively there is an identifiable group of persons with a social presence in a country, set apart from other members of that society, and united by a common characteristic, attribute, activity, belief, interest, goal, aim or principle. As I have indicated, it is not necessary that the persecutor or persecutors actually perceive the group as constituting "a particular social group". It is enough that the persecutor or persecutors single out the asylum-seeker for being a member of a class whose members possess a "uniting" feature or attribute, and the persons in that class are cognisable objectively as a particular social group. "Young, able-bodied Afghan men" as a particular social group In its reasons, the Tribunal accepted that the Taliban "does not have a regular conscription policy but has as a practice the recruitment, often forced, of young men regarded to have the potential to fight."90 The Tribunal also referred to "the ad hoc practice of recruitment and press-ganging new recruits"91. The 86 (2003) 78 ALJR 180; 203 ALR 112. 87 See, eg, the findings of Lindgren J at first instance: Kabir v Minister for Immigration and Multicultural Affairs [2001] FCA 968 at [17]. 88 See, eg, Kabir [2001] FCA 968 at [10] per Lindgren J. 89 See, eg, (2003) 78 ALJR 180 at 190 [55] per McHugh and Kirby JJ, 192 [65] per Gummow and Hayne JJ; 203 ALR 112 at 126, 128. 90 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [44]. 91 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [49]. McHugh Tribunal also accepted that the appellant "is of fighting age and had faced conscription in Afghanistan and was at risk of facing it again."92 However, the Tribunal made no finding as to whether this risk of conscription was for the reason that he was a member of "a particular social group" within the meaning of the Convention. Carr J held that the Tribunal had erred in not considering whether "young able-bodied men" were a particular social group within the meaning of Art 1A(2) of the Convention93. His Honour said that the "particular social group (able bodied Afghan men) is not defined by reference to the discriminatory treatment that its members fear."94 Consequently, the failure to make a finding as to whether the group of which the appellant claimed to be a member was "a particular social group" amounted to jurisdictional error95. In my opinion, Carr J was correct in finding that the Tribunal had erred in not considering whether "able-bodied young men" were "a particular social group" and that the error constituted jurisdictional error96. In most societies "able-bodied young men" would no more constitute "a particular social group" than would "good swimmers" or "fit athletes". Such classifications are intellectual constructs, not social groups. As Tamberlin J pointed out in Mahmoodi v Minister for Immigration and Ethnic Affairs97, descriptions such as "able-bodied Afghan males" are descriptions "of characteristics based on gender and health or fitness." However, it is possible that in Afghanistan the press- ganging of "able-bodied young men" has created a perception that they are "a particular social group". It is true that the appellant put no evidence before the Tribunal of any such perception in Afghan society or within some section of it or any evidence that would enable the inference to be drawn objectively that they 92 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [30.3]. 93 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 94 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 95 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 at [49] per Carr J. 96 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 97 [2001] FCA 1090 at [7]; cited with approval by Kiefel J in Applicant Z (2001) 116 FCR 36 at 45. McHugh were "a particular social group". Without such evidence, it seems difficult to see how "able-bodied young men" can constitute "a particular social group". Carr J thought that "able-bodied Afghan men" were "not defined by reference to the discriminatory treatment that its members fear."98 That proposition is true only if young, able-bodied Afghan men are cognisable as a particular social group, independently of the conduct of their persecutors. As I have indicated, ordinarily, the description "able-bodied young men" is an intellectual construct, not "a particular social group". In the absence of evidence that at the relevant time young, able-bodied Afghan men were cognisable as such a group, the basis for the appellant's claim for refugee status must fail. Carr J99 thought that the situation of the appellant was comparable to that of the "black child" in Chen Shi Hai v Minister for Immigration and Multicultural Affairs100. In Chen Shi Hai, it was claimed on behalf of the asylum-seeker, a young child, that he faced a real chance of persecution in China in contravention of the Convention, because he was "what is known in China as a 'black child'."101 In that case it was found that there was a clear societal perception that "black children" constituted a particular social group which could be defined independently of their persecutory treatment102. This case is also unlike cases such as Appellant S395/2002 and Appellant S396/2002103. In those cases it was held that homosexuals, the alleged "particular social group", were not a mere intellectual construct; rather, it was held that the descriptor "homosexuals" identified a group of persons which shares a particular sexual preference that unites them, sets them apart, and makes them a cognisable group within their society. Without evidence of some objective perception – which may be but is not necessarily required to be found in Afghan society or a section of it – that "able- bodied young men" comprise "a particular social group", in circumstances where 98 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 99 Applicant S v Minister for Immigration and Multicultural Affairs [2001] FCA 1411 100 (2000) 201 CLR 293. 101 (2000) 201 CLR 293 at 297 [6] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 102 Chen Shi Hai (2000) 201 CLR 293 at 297 [6], 301-302 [22]-[23] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 103 (2003) 78 ALJR 180; 203 ALR 112. McHugh the perception is capable of being identified independently of the persecutory treatment, the appellant's claim must fail. Without such evidence, the appellant and those like him are in no different a position from that of the appellant in Applicant A104. In that case it was found that the group, described as "parents in the reproductive age group" or "parents with one child", could only be defined by reference to the persecutory conduct. For the purposes of Art 1A(2) of the Convention, the group had no independent existence as "a particular social group". The Full Court of the Federal Court allowed the Minister's appeal on the ground that there was no evidence that Afghan society perceived "able-bodied young men" as comprising "a particular social group". With respect, in the context of the Tribunal's error, this was not a ground for allowing the Minister's appeal. If the Tribunal had considered the issue that it was legally required to consider, it was open to the Tribunal to investigate whether such a perception existed, whether within Afghan society or some section of it, or objectively. Indeed, arguably in the context of its inquisitorial process, the Tribunal had a duty to seek evidence concerning this vital matter. This may require the consideration of legal, social, cultural and religious norms prevalent in Afghan society to determine whether young, able-bodied Afghan men comprise a particular social group that may be distinguished from society at large. In Sanchez-Trujillo v Immigration and Naturalization Service, the United States Court of Appeals for the Ninth Circuit found that a "class of young, urban, working-class [El Salvadorian] males of military age who had maintained political neutrality" was not a "particular social group"105. But it does not follow that in Afghanistan young able-bodied men are not "a particular social group". Different legal, social, cultural and religious norms in different countries may bring about different results concerning similar groups or classes. By failing to consider whether young, able-bodied Afghan men constituted "a particular social group", the Tribunal prevented itself from obtaining evidence concerning that issue, evidence that might have determined the application in favour of the appellant. In the circumstances of this case, therefore, the failure of the appellant to put evidence before the Tribunal concerning the perception issue was not a ground for refusing to set aside the Tribunal's decision, once it is accepted that the Tribunal erred in not considering the issue of "a particular social group". 104 (1997) 190 CLR 225. 105 801 F 2d 1571 at 1571, 1576 (1986). The decision in Sanchez-Trujillo has been criticised for adopting an unduly narrow interpretation of the phrase "a particular social group": see Applicant A (1997) 190 CLR 225 at 260-261 per McHugh J. McHugh Accordingly, the Full Court erred in allowing the Minister's appeal. Persecution The Minister contends that the Tribunal's decision should be upheld because, even if the appellant was a member of a particular social group within the meaning of the Convention, he did not have a well-founded fear of persecution for reasons of his membership of that group. The Minister argues that forcible recruitment cannot amount to "persecution". This Court has not yet considered, in any detail, whether compulsory military service can amount to persecution for the purpose of the Convention. The issue was touched upon in Minister for Immigration and Multicultural Affairs v Israelian106, a case concerning an Armenian national who had sought to avoid being called up for military service in his home country. The primary issues in that appeal were whether – as the Minister argued – the Tribunal was obliged to make findings on material questions of fact and, if so, whether a failure to make such findings constituted reviewable error. The Minister succeeded. As a result, Mr Israelian's notice of contention – that the Tribunal had failed to consider whether he had a well-founded fear of persecution for reasons of his membership of a particular social group consisting of deserters and/or draft evaders – became relevant. In our joint judgment, Gummow and Hayne JJ and I said that, even if Mr Israelian was a member of a particular social group comprising deserters or draft evaders, the Armenian law which operated to punish those who had avoided a call-up notice was one of general application. Accordingly, Mr Israelian would not be the subject of persecution. Gummow and Hayne JJ and I said107: "[The Tribunal] concluded that there would not be persecution of Mr Israelian if he returned to his country of nationality, only the possible application of a law of general application. The Tribunal is not shown to have made an error of law in that respect." "The Tribunal's conclusion that the punishment Mr Israelian would face 'for avoiding his call-up notice ... would be the application of a law of 106 (2001) 206 CLR 323 (heard together with Minister for Immigration and Multicultural Affairs v Yusuf). 107 Israelian (2001) 206 CLR 323 at 354-355 [97]. 108 Israelian (2001) 206 CLR 323 at 342 [55]. McHugh common application' necessarily involves the consequence that that punishment would not be discriminatory and, hence, would not constitute persecution." (footnote omitted) in a manner that would not be "condoned This case is different from Israelian. Given the facts found by the Tribunal in the present case, the finding was open that the conscription methods of the Taliban constituted persecution. On the Tribunal's findings, the Taliban had an ad hoc practice of recruitment, which practice included press-ganging new internationally"109. recruits Accordingly, if the Tribunal had decided the particular social group issue in favour of the appellant, it was also open to the Tribunal to find that the appellant had a well-founded fear of persecution for a Convention reason. Given the Tribunal's findings about the nature of the Taliban's recruitment practices, it was open to the Tribunal to find that the Taliban was not applying a law of general application, but instead was forcibly apprehending members of the particular social group in an ad hoc manner that constituted persecution by the standards of civilised society. Orders The appeal should be allowed. 109 RRT Reference: N00/35095 (Unreported, Refugee Review Tribunal, 4 January 2001, Fordham TM) at [49]. Callinan CALLINAN J. This appeal is another which raises questions as to the identification of a particular social group and as to the nature of persecution within the meaning of s 36 of the Migration Act 1958 (Cth)110 ("the Act") which relevantly incorporates the Refugees Convention as amended by the Refugees Protocol. Facts S, now 24 years old, is from Afghanistan. He entered Australia on 11 July 2000. He came by boat with the assistance of a people smuggler. On 25 July 2000 he applied for a protection visa. His application was refused by a delegate of the respondent. It is his claim that he is a Pashtun by ethnicity, married and a former resident of a village under Taliban control for two years, where his wife, father, mother and four brothers still live. When the Taliban took control of the area in which the village is situated, some of its members detained him and his father on suspicion of concealing weapons. They were held for 20 days, maltreated, but then released. Approximately three weeks before his departure from Afghanistan, the Taliban leaders sought to conscript him into their forces, but he was able to buy them off. About a week before his departure, the Taliban again came to his village to conscript him. He was able to distract them by telling them that he needed to speak to his parents. He immediately left Afghanistan with the assistance of a people smuggler to whom his father paid more then US$6,000. The appellant claimed that he feared that if he were to return to Afghanistan he would be hanged by the Taliban because of his refusal to fight for them, and because he would be accused of being a Godless person, the evidence of which was his departure for a Western country. The decision of the Refugee Review Tribunal The Refugee Review Tribunal ("the Tribunal") affirmed the decision of the delegate of the respondent Minister. The Tribunal stated: "1. He is Afghan. 2. He is Pashtun, the same ethnic group as the Taliban. 110 The appeal is determined according to the legislation as it stood prior to the commencement of the Migration Legislation Amendment Act (No 6) 2001 (Cth). Callinan 3. He is of fighting age and had faced conscription in Afghanistan and was at risk of facing it again. 4. The Taliban is predominantly Pashtun and does not have a regular conscription programme but, on an ad hoc basis has a practice of rounding up or press-ganging young men available at the time into their services. 5. The Taliban has been in control of his area for two to two and a half years and continues to be so. 6. The situation in Taliban held areas has stabilised to the extent that the UN is prepared to facilitate return to them. Although the Applicant was interviewed twice by departmental officers and counselled by a solicitor, prior to the hearing and the submission of 13 October 2000 he made no claims to have feared harm at the hands of the Taliban for any reason other than being made to fight for them. In the time that he and his family lived under the control of the Taliban he made no claim to have opposed their 'social restrictions' and he made no claim to have suffered in a discriminatory way under the Taliban. While the ad hoc practice of recruitment and press-ganging new recruits including young students as described in the independent material ..., is not one which would be condoned internationally, Taliban's motivation is solely based on whether or not the recruits are capable of fighting. This selective process which targets young, able bodied males does not amount to discrimination for a Convention reason. The selection of young men or men of fighting age albeit in an 'ad hoc' manner does not amount to discrimination and is not Convention related any more than regularised conscription is in other countries. I have considered the information before me and, while I am left in no doubt that Taliban is by most standards a ruthless and despotic political body founded on extremist religious tenets, it is, nevertheless the body which controls 90 percent of Afghanistan and, though not internationally recognised by many states, is the current de facto government of Afghanistan. While I accept that Pakistani extremists both promote and support the movement and accept the evidence ... that many Afghan Taliban were trained in Madrassas in Pakistan I do not accept the Applicant's view that Callinan it is a foreign force. It is, according to independent material a 'Pashtun- dominated ultra-conservative Islamic movement' headed by Mullar Omar of Afghanistan. The nature of the recruitment process is such that there are no criteria for selection save being able-bodied and, being in the wrong place at the wrong time. By his own account he was approached in an ad hoc recruitment drive and I also find that the recruiters in that exercise were not seriously concerned whether he did fight or not as they were equally content with being paid to allow him to avoid the recruitment drive. When the second group came they took no action when he said he wanted to speak to his parents first and indicated that he may also pay them. Given Taliban's rigid approach to compliance this action leads me to conclude they were not concerned about the Applicant who had no skills or any significant value to them apart from his youth and the fact he was able-bodied. No immediate follow up occurred and he was not required to report to them. This leads me to conclude that he was not targeted to the extent that he was listed or registered for recruitment by the Taliban but was merely seen as a young man who was available in that area at that time and, in the random manner of such an ad hoc drive he was able to avoid recruitment for a second time. While I have sympathy for this young man and the tragic plight of his country over the past 20 years and under the current control of the extremist Taliban movement I find that his fear is that of many young men in his circumstances that, for non Convention reasons he will be recruited to fight for Taliban and that, the consequences could be that he may face serious harm or death. However, as discussed above I do not accept that he is of concern to the Taliban as someone who is opposed to them for speaking out against them nor do I find that his departure to avoid the ad hoc conscription practices of the Taliban would lead them to consider he was politically opposed to them. Large numbers of people who formerly fled Afghanistan are returning, in conditions which UNHCR considers safe. Callinan I find that this young man can do as thousands of his fellow citizens are doing and not face a 'real chance' of persecution for a Convention reason. In summary, I find that the Applicant is a national of Afghanistan and is a Pashtun who could be considered to be of fighting age by the Taliban. I accept that he may face serious harm as a consequence of being recruited into the Taliban militia as a consequence of fighting but, I find this harm would be the consequence of fighting between two opposing forces and, although he may not be committed to the aims and objectives of the Taliban, the motivation of the Taliban in recruiting him would be solely because he is a male with the potential to fight and for no other reason. This being the case, I find that his claims are such that I cannot be satisfied that he faces discriminatory treatment for any one or a combination of the five Convention reasons or for an aggregate of other reasons with a component of any of the five Convention reasons. This being the case, any fears he may hold in that regard are not well- founded and his claims do not bring the matter within the ambit of the Convention." The Federal Court The appellant subsequently applied to the Federal Court (Carr J) for review of the Tribunal's decision. His Honour concluded111: "In my opinion, the Tribunal should have considered whether able- bodied young men (or possibly able-bodied young men without the financial means to buy-off the conscriptors) in the above circumstances, comprised a particular social group within the meaning of Article 1A(2) of the Convention. By not doing so, in my opinion, the Tribunal erred in law in the manner to which I have referred above. The extent of its error was, in my view, such as to amount to jurisdictional error within the meaning of the principles explained in Minister for Immigration and Multicultural Affairs v Yusuf112." 111 [2001] FCA 1411 at [48]-[49]. 112 (2001) 206 CLR 323. Callinan The Full Court of the Federal Court An appeal to the Full Court of the Federal Court (Whitlam and Stone JJ, North J dissenting) succeeded. Stone J, with whom Whitlam J agreed, said this113: "The issue to be decided here is whether the facts before the Tribunal in this case could justify it in reaching the conclusion, contrary to that to which the Tribunal in Applicant Z114 came, that able-bodied men in Afghanistan (or able-bodied men with or without the financial means to buy off the conscriptors) comprise a particular social group within the meaning of the Convention. Following Khawar115 it is clear that this description is not sufficient to justify such a conclusion. Additional evidence to support a claim that they are perceived as such by their society is necessary. It is well established that the Tribunal should not limit itself to the case articulated by an applicant where the facts found by it, (or, as Sackville J stated in NAAT v Minister for Immigration and Multicultural Affairs116, not negated by its findings) might support an argument that the applicant is entitled to the protection of the Convention; Paramananthan v Minister for Immigration and Multicultural Affairs117; Saliba v Minister for Immigration and Ethnic Affairs118. In this case, however (unlike the position in Khawar), I can find no trace of any evidence before the Tribunal that would support a claim that Afghan society perceived young able-bodied men as comprising a separate group either as a result of the Taliban's recruitment process or for any other reason. In my view there is 113 Minister for Immigration and Multicultural Affairs v Applicant S (2002) 124 FCR 114 Minister for Immigration and Multicultural Affairs v Applicant Z (2001) 116 FCR 115 Minister for Immigration and Multicultural Affairs v Khawar (2002) 210 CLR 1. 116 [2002] FCA 332 at [43]. 117 (1998) 94 FCR 28. 118 (1998) 89 FCR 38. Callinan nothing to distinguish this case from that considered by the Full Court in Although the Tribunal may initiate additional inquiries (ss 424 and 427(1)(d) of the Migration Act 1958 (Cth)) it is not required to do so. Comments to the contrary in Prasad v Minister for Immigration and Ethnic Affairs119 and Luu v Renevier120 are not relevant here for reasons explained in Kola v Minister for Immigration and Multicultural Affairs121 and NAAT v Minister for Immigration and Multicultural Affairs122. In my view the Tribunal cannot be in error in failing to come to a conclusion that is not supported by the material before it." The appeal to this Court The appellant appeals to this Court upon the following grounds: The Full Court of the Federal Court erred when it held that there was no evidence before the Refugee Review Tribunal that Afghan society perceived young, able-bodied men as comprising a particular social group. The Full Court ought to have held that there was evidence and material before the Tribunal that young, able-bodied men may comprise a particular social group. Alternatively, the Full Court of the Federal Court erred in law in holding that it was necessary for there to be evidence before the Refugee Review Tribunal that Afghan society perceived young, able-bodied men as comprising a particular social group. The Full Court ought to have held, as a matter of law that: if there was evidence before the Refugee Review Tribunal that young, able-bodied men comprised a particular social group then the Tribunal was obliged as a matter of law to consider whether the appellant was a member of that group and feared persecution by reason of such membership; 119 (1985) 6 FCR 155. 120 (1989) 91 ALR 39. 121 (2002) 120 FCR 170. 122 [2002] FCA 332. Callinan such evidence may, but did not necessarily have to, include evidence as to the perceptions of Afghan society as to whether there was such a social group; and the learned primary judge was correct in holding that the Tribunal had erred in not considering whether the appellant was a member of that group and feared persecution by reason of such membership. It is the appellant's contention that there was evidence before the Tribunal capable of satisfying the conditions for a grant of refugee status to him as prescribed by Art 1A(2) of the Convention which has been adopted by s 36 of the Act. Article 1A(2) provides that a person is a refugee who: "owing to [a] well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion, is outside the country of his nationality and is unable or, owing to such fear, is unwilling to avail himself of the protection of that country; or who, not having a nationality and being outside the country of his former habitual residence as a result of such events, is unable or, owing to such fear, is unwilling to return to it." The appellant's application for a protection visa and his rights of appeal following a refusal of it are governed by s 476(1) of the Act in the form that it had before 2 October 2001. The appellant has contended and continues to do so that the Tribunal made an error of law within the meaning of s 476(1)(e) of the Act. At the outset it was necessary for the appellant to identify the particular social group or groups of which he claimed to be a member. These were, he said, either: able-bodied Afghan men; able-bodied young men; able-bodied Afghan men without the means of buying exemption from conscription; or young able- bodied men without the means of buying exemption from conscription. The circumstances of this case are different from those which the Court had to consider in Minister for Immigration and Multicultural Affairs v Haji Ibrahim123, of instability, anarchy and murderous shiftings in clan allegiances124. The Taliban was for all practical purpose the government of the country. The issue presented to the Court is a relatively narrow one: was the likelihood of the appellant's conscription to fight for the Taliban de facto government, as surely it at least was, persecution of him for reason of 123 (2000) 204 CLR 1. 124 (2000) 204 CLR 1 at 79 [222] per Callinan J. Callinan membership of a social group, namely of a category of able-bodied men throughout most, if not all of Afghanistan. Because the Article requires a form of singling out, the need to locate an applicant in a particular group, it imports the notion of difference, that is to say of the identification of a group that can be seen to be particular, and therefore separate from the rest of the population, and on that account the subject of differential and persecutory, and not merely discriminatory treatment, as unpleasant as the latter may be. It is convenient to deal with the appellant's second ground of appeal first. In pursuance of it, the appellant submitted that the Full Court erred in holding that "a social group" could be constituted as such for the purposes of the Convention only if the group were identified in the country of the refugee as a particular group: that a holding to the same effect of the Full Court of the Federal Court in Minister for Immigration and Multicultural Affairs v Zamora125 upon which the Full Court relied here was also erroneous and stemmed from a misreading of the decision of this Court in Applicant A v Minister for Immigration and Ethnic Affairs126. The particular proposition said to have been erroneously extracted from Applicant A in the earlier of the Full Court cases is the third of those in the following passage127: "... there must be some characteristic other than persecution or the fear of persecution that unites the collection of individuals; persecution or fear of it cannot be a defining feature of the group. Second, that characteristic must set the group apart, as a social group, from the rest of the community. Third, there must be recognition within the society that the collection of individuals is a group that is set apart from the rest of the community." I would accept this submission. There is nothing in the relevant Article of the Convention or s 36 of the Act adopting it which states or implies such a requirement. The question is not whether some undefined section of, or minority, or majority, or leaders of a country regard and recognise a particular group as a social group, as relevant and helpful to the giving of an answer to the correct question, an answer to that question might be. The correct question is simply whether an identifiable group or class of persons constitutes a particular social group. The attitude expressed by acts or words of people within a country 125 (1998) 85 FCR 458. 126 (1997) 190 CLR 225. 127 Minister for Immigration and Multicultural Affairs v Zamora (1998) 85 FCR 458 at 464 per Black CJ, Branson and Finkelstein JJ. Callinan towards others may, and usually will provide cogent evidence that those others are of a particular social group, but such acts or words cannot be conclusive of the issue. Both Dawson J128 and Gummow J129 in Applicant A stressed that a group must be recognisable as such, but said ultimately that it is for the Tribunal and a court of review or appeal, to accord that recognition or not. I would not take what McHugh J130 said in Applicant A to be to any contrary effect. The acceptance of the appellant's argument in relation to this ground of appeal does not mean that the appellant's appeal must succeed. In fact, in this case, it is, and was always clear that the Taliban regime did recognise the appellant and other able-bodied men whether young or not, for what they were, candidates for conscription to maintain the regime, or otherwise to further its ends, just as have, on occasions, most regimes both despotic and democratic from time immemorial. Conscription into a military force or a militia inevitably carries the risk of harm, indeed of death itself. The existence of that risk does not however conclude the issue of persecution. Between 1960 and 1970 able-bodied young men in Australia qualified by age to be balloted into national military service and of undertaking it in war in Vietnam, were a particular social group and were so regarded by many in this country. But it is another question whether they were, in consequence, a particular social group having a well-founded fear of persecution. The relevant question is whether a liability to give military service to or for the government, de facto or de jure, of a country with all the consequential risks that such service carries, is persecution for reason of membership of a particular social group. In my opinion it is not. It was not suggested that the appellant's opposition to service with the Taliban was based on any "ethical, moral or political grounds131." There was no evidence that the appellant, either alone or as a member of a group sharing political, moral, ethical or religious convictions, was singled out for military service. The Taliban was the party in power. The fact that they may have come to power in an undemocratic way does not alter the fundamental character of the conscription which they sought to impose in an indiscriminate way. 128 (1997) 190 CLR 225 at 241-242. 129 (1997) 190 CLR 225 at 285. 130 (1997) 190 CLR 225 at 264-266. 131 cf Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at 342 [54] per Gaudron J, 354 [94] per McHugh, Gummow and Hayne JJ. Callinan Previous authority132 fairly consistently holds that liability for conscription is not persecution for a Convention reason and with that holding I generally agree. Had the Full Court asked itself the correct question, not as to the existence or otherwise of the perception of some undefined section of Afghan society, of young or able-bodied men liable to be conscripted as a particular social group, but whether those men answered the description of a relevant social group contained in the Convention incorporated in s 36 of the Act, the answer would still have been the same, a negative one. Such men were not the subject of persecutory treatment. I would dismiss the appeal with costs. 132 Mijoljevic v Minister for Immigration and Multicultural Affairs [1999] FCA 834 at [23] per Branson J: "In my view, the conclusion of the Tribunal that the applicant's pacifist views did not provide a basis upon which it could be satisfied that he was a person to whom Australia owes protection obligations under the Refugees Convention was open to it on the evidence and material before it. Further, in my view, the Tribunal's reasons for decision do not suggest that the Tribunal's conclusion in this regard involved any error of law. This Court has on a number of occasions recognised that the enforcement of laws providing for compulsory military service, and for the punishment of those who avoid such service, will not ordinarily provide a basis for a claim of persecution within the meaning of the Refugees Convention". (footnotes omitted)
HIGH COURT OF AUSTRALIA AND PLAINTIFF ATTORNEY-GENERAL OF THE COMMONWEALTH DEFENDANT [2019] HCA 30 Date of Order: 19 June 2019 Date of Publication of Reasons: 11 September 2019 ORDER The questions stated in the revised special case filed on 26 November 2018 be answered as follows: Is the defendant's decision to refuse to consent under s 268.121 of the Criminal Code (Cth) to the prosecution of Ms Suu Kyi insusceptible of judicial review on the grounds raised in the amended application? Answer: Unnecessary to answer. If "no" to question 1, did the defendant make a jurisdictional error in refusing consent under s 268.121 of the Criminal Code to the prosecution of Ms Suu Kyi on the ground that Australia was obliged under customary international law to afford an incumbent foreign minister absolute immunity from Australia's domestic criminal jurisdiction (the asserted immunity) for one or more of the following reasons: Under customary international law as at the date of the defendant's decision, the asserted immunity did not apply in a domestic criminal prosecution in respect of crimes defined in the Rome Statute? By reason of: iii. the declaration made by Australia upon ratifying the Rome Statute; Australia's treaty obligations under the Rome Statute; and/or the enactment of the International Criminal Court Act 2002 (Cth) and the International Criminal Court (Consequential Amendments) Act 2002 (Cth), the obligations assumed by Australia under international law were such that the defendant was not entitled to refuse, on the basis of the asserted immunity, to consent to the domestic prosecution of Ms Suu Kyi in respect of crimes defined in the Rome Statute? By reason of: the declaration made by Australia upon ratifying the Rome Statute; Australia's treaty obligations under the Rome Statute; iii. the enactment of the International Criminal Court Act and the International Criminal Court (Consequential Amendments) Act; and/or the Diplomatic Privileges and Immunities Act 1967 (Cth), the Consular Privileges and Immunities Act 1972 (Cth) and the Foreign States Immunities Act 1985 (Cth), the defendant was not entitled under Australian domestic law to refuse, on the basis of the asserted immunity, to consent to the domestic prosecution of Ms Suu Kyi in respect of crimes defined in the Rome Statute? Answer: Does not arise. If "no" to question 1, did the defendant make a jurisdictional error in refusing consent to the prosecution of Ms Suu Kyi on the ground that he failed to afford the plaintiff procedural fairness? Answer: Does not arise. What relief, if any, should be granted? Answer: None. The amended application should be dismissed with costs. 5. Who should bear the costs of the special case? Answer: The plaintiff. Representation R Merkel QC with R J Sharp and M A J Isobel for the plaintiff (instructed by Human Rights for All Pty Ltd) S P Donaghue QC, Solicitor-General of the Commonwealth, with T M Begbie, K M Evans and C Ernst for the defendant (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal practice – Private prosecution – Authority to prosecute – Where private citizen sought to commence criminal proceeding for offence of crime against humanity contrary to s 268.11 of Criminal Code (Cth) – Where offence located within Div 268 of Criminal Code – Where s 268.121(1) provides that proceedings under Div 268 must not be commenced without Attorney-General's written consent – Where Attorney-General did not consent – Where s 268.121(2) of Criminal Code provides that offence against Div 268 "may only be prosecuted in the name of the Attorney-General" – Where s 13(a) of Crimes Act 1914 (Cth) provides that any person may "institute proceedings for the commitment for trial of any person in respect of any indictable offence against the law of the Commonwealth" unless contrary intention appears – Whether s 268.121(2) expresses contrary intention for purpose of s 13(a) – Whether s 268.121(2) precludes private prosecution of offence against Div 268. the Attorney-General", "contrary Words and phrases – "commencement of proceedings", "committal", "consent", "consent of intention", "crime against humanity", "in the name of", "indictable offence against the law of the Commonwealth", "private prosecution", "prosecuted in the name of the Attorney- General", "relator proceeding", "right to prosecute", "summary proceedings", "trial on indictment". Crimes Act 1914 (Cth), s 13(a). Criminal Code (Cth), ss 268.11, 268.121. Judiciary Act 1903 (Cth), ss 68, 69. KIEFEL CJ, BELL, GAGELER AND KEANE JJ. On 16 March 2018, the plaintiff, a private citizen, attended the Magistrates' Court at Melbourne. There he lodged a charge-sheet together with a draft summons. The charge-sheet alleged that Aung San Suu Kyi, the Minister of the Office of the President and Foreign Minister of the Republic of the Union of Myanmar, had committed a crime against humanity in contravention of s 268.11 of the Criminal Code (Cth). Section 268.11, which is located within Div 268 of the Criminal Code, creates an offence punishable by imprisonment for up to 17 years. By operation of ss 4G and 4J of the Crimes Act 1914 (Cth), an offence against s 268.11 is an indictable offence incapable of being heard and determined summarily. The plaintiff lodged the charge-sheet and draft summons in purported reliance on s 13(a) of the Crimes Act, in an attempt to invoke the procedure for the commencement of a criminal proceeding set out in Pt 2.2 of the Criminal Procedure Act 2009 (Vic). By these steps, the plaintiff attempted to commence a proceeding commonly and appropriately described as a private prosecution. Section 13 of the Crimes Act, which operates to the exclusion of the common law in relation to prosecutions for Commonwealth offences1, provides: "Unless the contrary intention appears in the Act or regulation creating the offence, any person may: institute proceedings for the commitment for trial of any person in respect of any the indictable offence against Commonwealth; or law of the institute proceedings for the summary conviction of any person in respect of any offence against the law of the Commonwealth punishable on summary conviction." Part 2.2 of the Criminal Procedure Act provides for a criminal proceeding to be commenced by methods which include filing a charge-sheet with a registrar of the Magistrates' Court2. On application by the person so commencing a criminal proceeding, a registrar must issue a summons to answer the charge directed to the accused if the registrar is satisfied that the charge discloses an 1 Brebner v Bruce (1950) 82 CLR 161 at 169-170, 174-175; [1950] HCA 36. 2 Section 6(1)(a) of the Criminal Procedure Act. offence known to law3. The summons to answer the charge needs then to be served on the accused4. In a case where the charge is of an indictable offence unable to be heard and determined summarily under Ch 3 and no direct indictment has been filed, the Magistrates' Court must then hold a committal hearing under Ch 45. At the conclusion of the committal hearing, the Magistrates' Court must commit the accused for trial of the offence charged if it is of the opinion that the evidence is of sufficient weight to support a conviction for the offence6. If the accused is committed for trial, the trial can only occur after the filing of an indictment in the Supreme Court or in the County Court in accordance with the procedure set out in Ch 57. The filing of an indictment does not commence a new criminal proceeding against the accused8 but is rather a continuation of the proceeding commenced by the filing of the charge-sheet. In accordance with the policy of the Magistrates' Court in relation to private prosecutions, the Registrar of the Magistrates' Court at Melbourne did not immediately file the charge-sheet or issue the summons. The Registrar instead referred the charge-sheet and draft summons for review by a Magistrate. On the same day as he lodged the charge-sheet and draft summons, the plaintiff sent an email the the defendant, Commonwealth, requesting his consent under s 268.121(1) of the Criminal Code to the commencement of the prosecution. Section 268.121 provides: the Attorney-General of "(1) Proceedings for an offence under this Division must not be commenced without the Attorney-General's written consent. (2) An offence against this Division may only be prosecuted in the name of the Attorney-General. 3 Section 12(1)(a) and (4)(a) of the Criminal Procedure Act. 4 Section 16 of the Criminal Procedure Act. 5 Section 96 of the Criminal Procedure Act. 6 Sections 141(4)(b) and 142(1)(b) of the Criminal Procedure Act. 7 Section 158(a) of the Criminal Procedure Act. 8 Section 162 of the Criminal Procedure Act. (3) However, a person may be arrested, charged, remanded in custody, or released on bail, in connection with an offence under this Division before the necessary consent has been given." The defendant did not consent to the prosecution. The defendant communicated his decision to the plaintiff in a letter three days later. On 23 March 2018, the plaintiff commenced a proceeding against the defendant in the original jurisdiction of the High Court under s 75(v) of the Constitution. The principal relief sought by the plaintiff in his amended application in that proceeding was a writ of certiorari quashing the decision of the defendant not to consent to the commencement of the prosecution and a writ of mandamus compelling the defendant to reconsider the plaintiff's request for consent. The grounds on which that relief was sought were that, in deciding not to consent, the defendant failed to comply with implied conditions on which the Attorney-General's power to give written consent is conferred by s 268.121(1) of the Criminal Code by adopting an erroneous view of the content of international law and by denying the plaintiff procedural fairness. By special case in the proceeding, the parties agreed in stating questions for the consideration of the Full Court. The questions, set out in full at the conclusion of these reasons, asked whether the defendant's decision was susceptible to judicial review on the grounds on which the plaintiff relied and, if so, whether those grounds were made out. Having heard argument on the logically anterior question as to whether s 268.121(2) of the Criminal Code, by providing that an offence against Div 268 "may only be prosecuted in the name of the Attorney-General", exhibits a contrary intention for the purpose of s 13 of the Crimes Act, we formed the view that it was not necessary to answer all of the questions stated by the parties in order to determine the plaintiff's entitlement to relief in the proceeding. In the circumstances, we considered that it was inappropriate to do so. In our view, s 268.121(2) of the Criminal Code does exhibit a contrary intention for the purpose of s 13 of the Crimes Act so as to preclude the private prosecution of an offence against Div 268 and the amended application was for that reason to be dismissed. These are our reasons. The construction of s 268.121 of the Criminal Code needs to be considered within the context of Div 268 of the Criminal Code, which was introduced by the International Criminal Court (Consequential Amendments) Act 2002 (Cth) ("the Consequential Amendments Act") in consequence of the enactment of the International Criminal Court Act 2002 (Cth). The principal object of the International Criminal Court Act is to facilitate compliance with Australia's obligations under the Rome Statute of the International Criminal Court (1998) ("the Rome Statute")9. Enactment of the Consequential Amendments Act was against the background of the Preamble to the Rome Statute "[r]ecalling that it is the duty of every State to exercise its criminal jurisdiction over those responsible for international crimes" and "[e]mphasizing that the International Criminal Court established under this Statute shall be complementary to national criminal jurisdictions". The Second Reading Speech for the Bill for the Consequential Amendments Act explained the main purpose of its enactment in terms of facilitating exercise of Australia's international rights under and pertaining to the Rome Statute. The main purpose was said to be to create as offences against Australian law each of the offences against international law over which the International Criminal Court ("the ICC") had been given jurisdiction under the Rome Statute and thereby to enable Australia to "take full advantage of the principle and protection of complementarity"10. The Explanatory Memorandum accompanying the Bill further explained that "[b]y creating crimes in Australian law that mirror the crimes in the [Rome Statute], Australia will always be able to prosecute a person accused of a crime under the [Rome Statute] in Australia rather than surrender that person for trial in the ICC"11. The purpose of facilitating exercise of Australia's international rights is manifest on the face of the International Criminal Court Act, which states with reference to Div 268 of the Criminal Code that the International Criminal Court Act "does not affect the primacy of Australia's right to exercise its jurisdiction with respect to crimes within the jurisdiction of the ICC"12. More importantly for present purposes, the purpose of facilitating exercise of Australia's international rights is manifest on the face of Div 268 of the Criminal Code and informs the structure of the Division. Introducing Div 268 is s 268.1, which is headed "Purpose of Division". Section 268.1(1) states that "[t]he purpose of this Division is to create certain offences that are of 9 Section 3(1) of the International Criminal Court Act. 10 Australia, House of Representatives, Parliamentary Debates (Hansard), 25 June 11 Australia, House of Representatives, International Criminal Court (Consequential Amendments) Bill 2002, Explanatory Memorandum at 4. 12 Section 3(2) of the International Criminal Court Act. international concern and certain related offences". Section 268.1(2) expresses "Parliament's intention that the jurisdiction of the International Criminal Court is to be complementary to the jurisdiction of Australia with respect to offences in this Division that are also crimes within the jurisdiction of that Court". Section 268.1(3) spells out the consequence that the International Criminal Court Act "does not affect the primacy of Australia's right to exercise its jurisdiction with respect to offences created by this Division that are also crimes within the jurisdiction of the International Criminal Court". Consistently with the purpose of facilitating exercise of Australia's international rights so manifested in s 268.1, s 268.120 provides that "[t]his Division is not intended to exclude or limit any other law of the Commonwealth or any law of a State or Territory". Contrary to a submission of the plaintiff, s 268.120 has no bearing on whether the Division expresses or implies a "contrary intention" for the purpose of s 13 of the Crimes Act. The specific provisions in s 268.121 concerning the particular procedure for the prosecution of offences under Div 268 of the Criminal Code need to be understood against the background of the general procedure for the prosecution of offences under Commonwealth law for which provision is made in ss 68 and 69 of the Judiciary Act 1903 (Cth). That general procedure for the prosecution of offences under Commonwealth law also forms the background to s 13 of the Crimes Act. Section 68(1) of the Judiciary Act operates in general to apply State and Territory criminal procedure in respect of persons charged with Commonwealth offences in respect of whom State and Territory courts are invested with federal jurisdiction under s 68(2). Section 68(1) does so by picking up specified categories of State and Territory laws. It provides: "The laws of a State or Territory respecting the arrest and custody of offenders or persons charged with offences, and the procedure for: their summary conviction; and their examination and commitment for trial on indictment; and their trial and conviction on indictment; and the hearing and determination of appeals arising out of any such trial or conviction or out of any proceedings connected therewith; and for holding accused persons to bail, shall, subject to this section, apply and be applied so far as they are applicable to persons who are charged with offences against the laws of the Commonwealth in respect of whom jurisdiction is conferred on the several courts of that State or Territory by this section." The first three paragraphs of s 68(1) recognise the distinction, well enough illustrated by the structure of the Criminal Procedure Act, between the procedure typically applicable under State and Territory laws to offences heard and determined summarily and the procedure typically applicable to offences tried on indictment. "There is", as Dixon J said in Munday v Gill13 in words which remain as true today as they did at the time of enactment of the Judiciary Act, "a great distinction in history, in substance and in present practice between summary proceedings and trial upon indictment". Trials on indictment are in traditional parlance "pleas of the Crown": proceedings in form and in substance between an individual and the State. A prosecution for an offence punishable summarily is in contrast "a proceeding between subject and subject"14. The second and third paragraphs of s 68(1) recognise the traditional distinction, again well enough illustrated by the structure of the Criminal Procedure Act, between two distinct stages of the procedure typically applicable to offences tried on indictment: examination and commitment for trial on indictment, and trial and conviction on indictment. In R v Murphy15, it was held that these two distinct stages form part of the one curial process that results in the resolution of the "matter" in respect of which federal jurisdiction is conferred by s 68(2). In the language of that case16, "[e]ven though they are properly to be regarded as non-judicial in character, committal proceedings themselves traditionally constitute the first step in the curial process, possibly culminating in the presentation of the indictment and trial by jury" such that "[t]hey have the closest, if not an essential, connexion with an actual exercise of judicial power". Speaking to the second of those two distinct stages of the procedure traditionally applicable to offences tried on indictment, s 69(1) of the Judiciary Act provides: 13 (1930) 44 CLR 38 at 86; [1930] HCA 20. 14 (1930) 44 CLR 38 at 86. 15 (1985) 158 CLR 596; [1985] HCA 50. 16 (1985) 158 CLR 596 at 616. "Indictable offences against the laws of the Commonwealth shall be prosecuted by indictment in the name of the Attorney-General of the Commonwealth or of such other person as the Governor-General appoints in that behalf." The language of s 69(1) of the Judiciary Act can be traced to the prescription in s 5 of the Australian Courts Act 1828 (Imp)17 that "all Crimes, Misdemeanors, and Offences ... shall be prosecuted by Information, in the Name of His Majesty's Attorney General, or other Officer duly appointed for such Purpose by the Governor". With reference to s 5, it was explained in Commonwealth Life Assurance Society Ltd v Smith18 that, "[w]hen an accused person [was] committed for trial, it [was] for the Attorney-General to consider whether the accused should be put on his trial and for what precise offence, and this he [did] by filing or refusing to file an indictment". Subject only to the proviso in s 6, which has no counterpart in the Judiciary Act, s 5 was held to confer on the Attorney-General for New South Wales and appointed officers an exclusive power not merely to determine whether or not to initiate a trial by filing an indictment19 but, where an indictment was filed, to control the conduct of the further prosecution of the matter20. Whosoever was authorised to conduct the prosecution, conducted the prosecution in law "for the Crown"21. In Daley v The Queen22, Green CJ succinctly stated the corresponding operation of s 69(1) of the Judiciary Act in terms that it "vests the right and duty to prosecute ... indictments exclusively in the Commonwealth Attorney-General or in appointed officers". The exclusive nature of the right and duty vested in the Attorney-General or in an appointed officer by s 69(1) of the Judiciary Act is confirmed by the carve-out from its operation by s 69(2A), which provides: 17 9 Geo IV c 83. 18 (1938) 59 CLR 527 at 543; [1938] HCA 2. 19 See Barton v The Queen (1980) 147 CLR 75 at 88, 93-94; [1980] HCA 48. 20 R v Lang (1859) 2 Legge 1133 at 1134. 21 R v Walton (1851) 1 Legge 706 at 707. 22 [1979] Tas R 75 at 79. See also R v Bright [1980] Qd R 490 at 500. "Nothing in subsection (1): affects the power of the Director of Public Prosecutions to prosecute by indictment in his or her official name; or affects, or shall be taken to have affected, the power of a Special Prosecutor to prosecute by indictment in his or her own name; indictable offences against the laws of the Commonwealth." Section 69(2A)(a) alludes to the power conferred on the Director of Public Prosecutions by s 9(1) of the Director of Public Prosecutions Act 1983 (Cth) to prosecute offences against Commonwealth laws "by indictment in his or her official name" or "in any other manner". The power to prosecute "in any other manner" enables the Director of Public Prosecutions to prosecute in the name of "the Queen"23 and, in an appropriate case, to prosecute in the name of "the Attorney-General". Section 69(2A)(b) alludes to the substantially identical power conferred on a Special Prosecutor by s 8(1) of the Special Prosecutors Act 1982 (Cth). The exclusive nature of the right and duty vested in the Attorney-General or in an appointed officer by s 69(1) of the Judiciary Act is also recognised in s 13 of the Crimes Act. Where it is applicable, s 13(a) goes no further than to allow a person other than the Attorney-General or an appointed officer to institute proceedings for the commitment for trial of a person in respect of an indictable offence against a law of the Commonwealth. Where a person is committed for trial, filing or refusing to file any subsequent indictment is outside the scope of the capacity to prosecute conferred by s 13(a) of the Crimes Act and solely within the province of the Attorney-General or appointed officer under s 69(1) of the Judiciary Act subject only to the carve-out in s 69(2A) of the Judiciary Act. So much was accepted by the plaintiff. By providing that an offence "may only be prosecuted in the name of" a designated office-holder – the Attorney-General – s 268.121(2) of the Criminal Code adopts a form of words recognised by the Australian Law Reform Commission in 1985 as having commonly been used in Commonwealth legislation to impose an "absolute restriction upon the right to prosecute"24. 23 R v Gee (2003) 212 CLR 230 at 247 [34]; [2003] HCA 12. 24 Australian Law Reform Commission, Standing in Public Interest Litigation, Report No 27 (1985) at 194 [365]. The earliest variant was in s 245 of the Customs Act 1901 (Cth) and s 134 of the Excise Act 1901 (Cth), which respectively provided that customs prosecutions and excise prosecutions "may be instituted in the name of the Minister" and in specified circumstances "may be instituted in the name of the Collector"25. In Christie v Permewan, Wright & Co Ltd26, Griffith CJ identified the object of s 245 of the Customs Act as being "to define who is to be the prosecutor". The holding in that case was that the Minister or Collector did not need to prosecute personally but that another person (even if an officer of customs) could prosecute only if authorised by the Minister or Collector to prosecute for and on behalf of the Minister or Collector27. In Bainbridge-Hawker v The Minister of State for Trade and Customs28, Dixon CJ said that "[t]he point of the material words of the provision is the designation by the section of the responsible officer of the Crown who is to sue on behalf of the Crown". One year after enactment of the Crimes Act, a similar form of words was adopted in s 6(3A) of the War Precautions Act 1914 (Cth)29. Section 6(3A) provided: "An offence against this Act shall not be prosecuted summarily without the written consent of the Attorney-General or the Minister for Defence, or a person authorized in writing by the Attorney-General or the Minister for Defence, and an offence against this Act shall not be prosecuted upon indictment except in the name of the Attorney-General." The section can be seen to have had two distinct limbs. The first, speaking to the subject-matter of s 13(b) of the Crimes Act, provided that an offence "shall not be prosecuted summarily without the written consent of the Attorney-General or the Minister for Defence, or a person authorized in writing by the Attorney-General or the Minister for Defence". The second, speaking to the subject-matter of s 69 25 See Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161; [2003] HCA 49 with respect to the nature of customs and excise prosecutions. 26 (1904) 1 CLR 693 at 698; [1904] HCA 35. 27 (1904) 1 CLR 693 at 700. 28 (1958) 99 CLR 521 at 546; [1958] HCA 60. 29 Introduced by Act No 39 of 1915. of the Judiciary Act, provided that an offence "shall not be prosecuted upon indictment except in the name of the Attorney-General". In McDonnell v Smith30, the first limb of s 6(3A) of the War Precautions Act was held to mean that a summary prosecution was not to be begun without the requisite consent having first been given. Gavan Duffy J observed in the course of argument31 that "[a] prosecution begins as soon as the first step is taken, and continues until completion". The Court went on to provide in its reasons for judgment that "the prosecution is begun when the information is laid"32. In R v Judd33, Isaacs J later explained the structure and operation of s 6(3A) of the War Precautions Act by reference to s 13(b) of the Crimes Act and s 69 of the Judiciary Act: "[W]hen the Commonwealth legislation existing at the time sec 6(3A) was passed is looked at, a reason is found for the form in which sec 6(3A) is enacted. The legislation then existing related both to summary procedure and to procedure by way of indictment. As to summary procedure, that was provided for by sec 13 of the Crimes Act 1914, which allowed any person to institute proceedings; and as to indictment, that was found in sec 69 of the Judiciary Act, which provided that indictments should be in the name of the Attorney-General or of some person commissioned by the Governor-General." Turning to the purpose and effect of s 6(3A), Isaacs J continued34: "When the Act No 39 of 1915 was passed, the law was amended in a way which allowed the Executive to take steps for the safety of the Commonwealth and of the Empire which might be of a very drastic character, and the enforcement of regulations made under that Act might involve a great deal of discretion on the part of the public authority. The Legislature, while giving those powers, provided by sec 6(3A) a safeguard 30 (1918) 24 CLR 409; [1918] HCA 26. 31 (1918) 24 CLR 409 at 411. 32 (1918) 24 CLR 409 at 412. 33 (1919) 26 CLR 168 at 172; [1919] HCA 9. 34 (1919) 26 CLR 168 at 172. to the individual in this way, that no prosecution should be instituted either summarily or by indictment, except by executive authority. To carry that out, they provided that summary procedure should be with the written consent of a Minister of State, either the Attorney-General or the Minister for Defence, specially named, or some person under the written authority of one of those Ministers of State; and that in the case of an indictment it should be in the name of the Attorney-General, cutting out for the purpose of the Act the provision in sec 69 of the Judiciary Act as to a person who was commissioned by the Governor-General. That left the whole thing really in the hands of the Executive Government." Consistently with the reasoning of Isaacs J, Gavan Duffy J in R v Judd said of the second limb of s 6(3A) that it "gives no new power to the Attorney General, but in certain cases forbids prosecution by indictment in the name of any person other than the Attorney-General"35. The unanimous holding in R v Judd was that, by force of s 19 of the Acts Interpretation Act 1901 (Cth), the reference in s 6(3A) to "the Attorney-General" was taken to include any Minister for the time being acting for or on behalf of the Attorney-General, with the result that the Minister for Defence was "at liberty to act for [the Attorney-General] in prosecuting by indictment"36. The language and structure of s 6(3A) of the War Precautions Act were repeated in other legislation including s 15(4) of the Defence (Transitional Provisions) Act 1946 (Cth) and s 21(4) of the Public Accounts Committee Act 1951 (Cth)37. By providing that an offence "shall not be prosecuted upon indictment except in the name of the Attorney-General", the second limb of each of those provisions limited, in the manner indicated by R v Judd, who could prosecute an offence on indictment under s 69 of the Judiciary Act but plainly said nothing to limit who might institute proceedings for the commitment of a person for trial in respect of an indictable offence under s 13(a) of the Crimes Act. The language of the second limb of each of those provisions was also adopted, in a slightly altered form, in s 7(6) of the Geneva Conventions Act 1957 (Cth). 35 (1919) 26 CLR 168 at 173. 36 (1919) 26 CLR 168 at 174. 37 See also s 10(4) of the National Security Act 1939 (Cth); s 6(4) of the War Damage to Property Act 1948 (Cth); s 8(4) of the Defence Preparations Act 1951 (Cth). With the enactment of the Director of Public Prosecutions Act, the Director of Public Prosecutions (Consequential Amendments) Act 1983 (Cth) amended each of s 15(4) of the Defence (Transitional Provisions) Act, s 21(4) of the Public Accounts Committee Act and s 7(6) of the Geneva Conventions Act to refer to prosecution in the name of the Attorney-General "or of the Director of Public Prosecutions". The then Minister for Trade, Mr Bowen, referred to the amended provisions as provisions "which vest in the Attorney-General an exclusive right to commence or conduct prosecutions or prosecutions of a particular kind" and explained that a "like right" was given by the amendments to the Director of Public Prosecutions38. The precise form of s 268.121(2), in providing that an offence "may only be prosecuted in the name of the Attorney-General", derives more immediately from s 12 of the War Crimes Act 1945 (Cth), which was inserted by the War Crimes Amendment Act 1988 (Cth). Section 12 provides that "[a]n offence against this Act may only be prosecuted in the name of the Attorney-General or the Director of Public Prosecutions". The Explanatory Memorandum accompanying the Bill for the War Crimes Amendment Act explained that the purpose of s 12 was to provide a contrary intention for the purposes of s 13 of the Crimes Act. It explained that "[t]he nature of the offences" in the War Crimes Act made it "desirable to exclude the possibility of private prosecutions"39. Against the background of the consistent use of references to prosecutions "in the name of" to connote the exclusivity of the vesting of authority to prosecute, the aptness of the language in s 268.121(2) to define exhaustively who can prosecute an offence against Div 268 of the Criminal Code is evident. By providing that an offence against Div 268 "may only be prosecuted in the name of the Attorney-General", the section confines persons having capacity to prosecute an offence against Div 268 to: the person for the time being holding or occupying the office of Attorney-General40; such other Ministers or members of the Executive Council as the Attorney-General might authorise to prosecute41; and such other persons who might have authority conferred on them to prosecute 38 Australia, House of Representatives, Parliamentary Debates (Hansard), 17 November 1983 at 2883. 39 Australia, House of Representatives, War Crimes Amendment Bill 1987, Explanatory Memorandum at 8. 40 Section 34AAA of the Acts Interpretation Act 1901 (Cth). 41 Section 34AAB of the Acts Interpretation Act 1901 (Cth). in the name of the Attorney-General, including the Director of Public Prosecutions under s 9(1) of the Director of Public Prosecutions Act. The operation of s 268.121(2) is narrower than s 12 of the War Crimes Act insofar as it precludes even the Director of Public Prosecutions from prosecuting in his or her own official name under s 9(1) of the Director of Public Prosecutions Act. By defining exhaustively who can prosecute an offence against Div 268 of the Criminal Code, s 268.121(2) of the Criminal Code operates in like manner to s 12 of the War Crimes Act to express a contrary intention for the purpose of the whole of s 13 of the Crimes Act. In particular, it excludes the capacity of any other person to commence any prosecution of any offence under Div 268. The plaintiff argued that the exclusory operation of s 268.121(2) was confined to the second stage of the procedure applicable to offences tried on indictment, so as to permit a private prosecution to proceed, with the consent of the Attorney-General, up to and no further than the committal stage. On the plaintiff's construction, the word "prosecuted" in s 268.121(2) would be read as though it were "prosecuted upon indictment" or "prosecuted by indictment". There is no justification in the text or context of s 268.121(2) for confining its operation in the manner for which the plaintiff contended. The words "upon indictment" or "by indictment" are absent from the provision. In this respect the provision differs from the model established by s 6(3A) of the War Precautions Act but mirrors s 12 of the War Crimes Act. The prosecution to which s 268.121(2) refers is the totality of the prosecutorial process beginning with the commencement of proceedings for an offence against Div 268 to which s 268.121(1) refers. In the case of an indictable offence against Div 268 sought to be prosecuted in a Victorian court in accordance with the procedure in the Criminal Procedure Act picked up by s 68(1) of the Judiciary Act, the prosecution to which s 268.121(2) refers accordingly includes the commencement of the proceeding by filing a charge- sheet with a registrar of the Magistrates' Court42. The reference in s 268.121(1) to "[p]roceedings for an offence under this Division" must be read as limited to proceedings for an offence against Div 268 that are permitted to be brought consistently with s 268.121(2). The Explanatory Memorandum to the Bill for the Consequential Amendments Act indicates that it 42 Sections 6(1)(a) and 162 of the Criminal Procedure Act. is only "such proceedings" as require consent under s 268.121(1) that are to be prosecuted in the name of the Attorney-General under s 268.121(2)43. That construction of s 268.121(2) does not render the requirement for consent under s 268.121(1) redundant. What the belt of s 268.121(1) adds to the brace of s 268.121(2) is that it ensures that proceedings for an offence against Div 268 that are permitted to be brought consistently with s 268.121(2), including such proceedings as might be brought by the Commonwealth Director of Public Prosecutions in the name of the Attorney-General, are not commenced without the written consent of the Attorney-General given in respect of the particular proceedings. Consistently with the holding in McDonnell v Smith in relation to s 6(3A) of the War Precautions Act, that consent must be given prior to the commencement of the proceedings. Were the operation of s 268.121(2) confined in the manner proposed by the plaintiff, the section would add nothing of substance to s 69(1) of the Judiciary Act. Moreover, for a private citizen to be free to bring a private summary prosecution or a private prosecution up to the committal stage, and for that purpose to seek out the consent of the Attorney-General, would do nothing to advance the legislative purpose of facilitating exercise of Australia's international rights. It would instead have the real potential to embarrass Australia internationally. It follows that the power conferred on the Attorney-General by s 268.121(1) does not extend to giving consent to the commencement of a private prosecution of the kind the plaintiff sought to commence. The decision in fact made by the defendant not to consent to the prosecution was the only decision legally open. The relief sought by the plaintiff in the amended application could only be refused. For completeness, we add that s 268.121(3) is best seen, as the Commonwealth Solicitor-General submitted, as a provision inserted for the avoidance of doubt rather than as a provision which qualifies the operation of either s 268.121(1) or s 268.121(2). The processes of arrest, charge, remand in custody and release on bail to which s 268.121(3) refers are limited to processes 43 Australia, House of Representatives, International Criminal Court (Consequential Amendments) Bill 2002, Explanatory Memorandum at 16. answering proceedings44. those descriptions occurring before the commencement of For these reasons, having heard argument only on the construction of s 268.121 of the Criminal Code and its relationship with s 13 of the Crimes Act, we answered the questions of law raised by the special case as follows: Is the defendant's decision to refuse to consent under s 268.121 of the Criminal Code to the prosecution of Ms Suu Kyi insusceptible of judicial review on the grounds raised in the amended application? Answer: Unnecessary to answer. If "no" to question 1, did the defendant make a jurisdictional error in refusing consent under s 268.121 of the Criminal Code to the prosecution of Ms Suu Kyi on the ground that Australia was obliged under customary international law to afford an incumbent foreign minister absolute immunity from Australia's domestic criminal jurisdiction (the asserted immunity) for one or more of the following reasons: Under customary international law as at the date of the defendant's decision, the asserted immunity did not apply in a domestic criminal prosecution in respect of crimes defined in the Rome Statute? By reason of: iii. the declaration made by Australia upon ratifying the Rome Statute; Australia's treaty obligations under the Rome Statute; and/or the enactment of the International Criminal Court Act and the Consequential Amendments Act, 44 See Australia, House of Representatives, International Criminal Court (Consequential Amendments) Bill 2002, Explanatory Memorandum at 16. the obligations assumed by Australia under international law were such that the defendant was not entitled to refuse, on the basis of the asserted immunity, to consent to the domestic prosecution of Ms Suu Kyi in respect of crimes defined in the Rome Statute? By reason of: iii. the declaration made by Australia upon ratifying the Rome Statute; Australia's treaty obligations under the Rome Statute; the enactment of the International Criminal Court Act and the Consequential Amendments Act; and/or the Diplomatic Privileges and Immunities Act 1967 (Cth), the Consular Privileges and Immunities Act 1972 (Cth) and the Foreign States Immunities Act 1985 (Cth), the defendant was not entitled under Australian domestic law to refuse, on the basis of the asserted immunity, to consent to the domestic prosecution of Ms Suu Kyi in respect of crimes defined in the Rome Statute? Answer: Does not arise. If "no" to question 1, did the defendant make a jurisdictional error in refusing consent to the prosecution of Ms Suu Kyi on the ground that he failed to afford the plaintiff procedural fairness? Answer: Does not arise. 4. What relief, if any, should be granted? Answer: None. The amended application should be dismissed with costs. 5. Who should bear the costs of the special case? Answer: The plaintiff. NettleJ NETTLE AND GORDON JJ. We regret that we are of a different view from the majority. For the reasons that follow, we do not accept that s 268.121(2) of the Criminal Code (Cth) ("the Code") excludes the right of a private person to seek the consent of the Attorney-General of the Commonwealth under s 268.121(1) of the Code to commence proceedings for an offence against Div 268 of the Code, or, if the Attorney-General grants consent, the right of that person under s 13 of the Crimes Act 1914 (Cth) to commence those proceedings. Facts and relevant statutory provisions The facts of the matter sufficiently appear from the judgment of the majority, whose summary we gratefully adopt. Before proceeding further, however, it is convenient to restate the substance of the relevant statutory provisions. Section 13 of the Crimes Act provides as follows: "Institution of proceedings in respect of offences Unless the contrary intention appears in the Act or regulation creating the offence, any person may: institute proceedings for the commitment for trial of any person in the indictable offence against respect of any Commonwealth; or law of the institute proceedings for the summary conviction of any person in respect of any offence against the law of the Commonwealth punishable on summary conviction." Section 68(1) of the Judiciary Act 1903 (Cth) provides in effect that, except as otherwise provided, State or Territory laws with respect to the procedure for summary conviction, examination and commitment for trial on indictment, trial and conviction on indictment, and the hearing and determination of appeals therefrom must be applied, so far as applicable, to those persons charged with offences against any Commonwealth law in respect of whom the courts of that State or Territory have jurisdiction under s 68(2). Section 69 of the Judiciary Act provides in effect and so far as is relevant that indictable offences against any Commonwealth law shall be prosecuted by indictment in the name of the Attorney-General or any other person appointed in that behalf by the Governor-General, but that the power of the Director of Public Prosecutions, and of a Special Prosecutor, to prosecute by indictment in his or her own name is unaffected. NettleJ Sections 268.120, 268.121 and 268.122 of the Code provide as follows: Saving of other laws This Division is not intended to exclude or limit any other law of the Commonwealth or any law of a State or Territory. Bringing proceedings under this Division Proceedings for an offence under this Division must not be commenced without the Attorney-General's written consent. (2) An offence against this Division may only be prosecuted in the name of the Attorney-General. (3) However, a person may be arrested, charged, remanded in custody, or released on bail, in connection with an offence under this Division before the necessary consent has been given. Attorney-General's decisions in relation to consents to be final to any Subject the Constitution, a decision by the Attorney-General to give, or to refuse to give, a consent under section 268.121: the High Court under jurisdiction of is final; and (b) must not be challenged, appealed against, reviewed, quashed or called in question; and is not subject declaration or certiorari. to prohibition, mandamus, injunction, The reference in subsection (1) to a decision includes a reference to the following: a decision to vary, suspend, cancel or revoke a consent that has been given; a decision to impose a condition or restriction in connection with the giving of, or a refusal to give, a consent or to remove a condition or restriction so imposed; a decision to do anything preparatory to the making of a decision to give, or to refuse to give, a consent or NettleJ preparatory to the making of a decision referred to in paragraph (a) or (b), including a decision for the taking of evidence or the holding of an inquiry or investigation; a decision doing or refusing to do anything else in connection with a decision to give, or to refuse to give, a consent or a decision referred to in paragraph (a), (b) or (c); a failure or refusal to make a decision whether or not to give a consent or a decision referred to in a [sic] paragraph (a), (b), (c) or (d). (3) Any jurisdiction of the High Court referred to in subsection (1) is exclusive of the jurisdiction of any other court." The presumption under s 13 of the Crimes Act Section 13 of the Crimes Act replaced the long-established common law right of a private person to institute criminal proceedings with a statutory presumptive right adapted to the modern procedures for commitment for trial and summary determination. including the offence, Under the "common law"45 as received in Australia, whether and how a private person might initiate criminal proceedings depended primarily on the nature of felony or misdemeanour46, and, where it was triable summarily, on the public interest in the wrong47. But as Fullagar J observed48 in Brebner v Bruce, the cases classifying offences for this purpose were "perhaps not very satisfactory". Against that background, s 13 of the Crimes Act both generalised the common law right and adapted it to modern criminal procedure. Under it, general probabilities of intention based on the nature and terms of the legislation in its characterisation as a 45 See PGA v The Queen (2012) 245 CLR 355 at 370 [20]-[22] per French CJ, Gummow, Hayne, Crennan and Kiefel JJ; [2012] HCA 21. See also Leeming, "Theories and Principles Underlying the Development of the Common Law – The Statutory Elephant in the Room" (2013) 36 University of New South Wales Law Journal 1002. 46 See [59]-[60] below. 47 Cole v Coulton (1860) 2 El & El 695 at 702-703 per Cockburn CJ [121 ER 261 at 48 (1950) 82 CLR 161 at 172; [1950] HCA 36. NettleJ question cannot displace the prima facie position that any person may initiate criminal proceedings; exclusion of the right of private prosecution must now appear in express terms or at least as a matter of necessary implication. As "s 13 is really directing us to look, without reference to cases decided in its absence, at each particular statute to see whether a 'contrary intention' appears from express words or from necessary implication". The text of s 268.121 of the Code Section 268.121 of the Code does not expressly state that a private person may not commence a proceeding for an offence against Div 268 of the Code. Nor does it imply as much. Section 268.121(1) provides that proceedings for such an offence must not be commenced without the Attorney-General's written consent. That implies that a private person may bring proceedings if the person first obtains the consent of the Attorney-General. Section 268.121(2) provides that an offence against Div 268 may only be prosecuted in the name of the Attorney-General. That is consistent with the right of a private person to bring proceedings with the consent of the Attorney-General. The Solicitor-General of the Commonwealth contended that s 268.121(2) should be read as if it stated that proceedings for such an offence may only be brought by the Attorney-General or by one of the Attorney-General's delegates. That contention should be rejected. So to construe s 268.121(2) would fly in the face of its text. If the drafters of s 268.121(2) had intended to convey the meaning that proceedings can only be brought by the Attorney-General or by a delegate of the Attorney-General, they would surely have specified, in terms, that proceedings can only be brought by the Attorney-General or by a delegate of the Attorney-General. Instead, they chose a form of words which, in its natural and ordinary meaning, contemplates action "[c]iting the authority of" or "on behalf of" another50. As will be explained, that form of words also imports a long-established, and substantially consistent, meaning in English and Australian law. 49 Brebner (1950) 82 CLR 161 at 174. 50 Oxford English Dictionary, online, "name", phrase 2, sense d, available at <https://www.oed.com/view/Entry/124918>, which also explains the reflexive expression "in one's own name", meaning "on one's own behalf, independently, without the authority of another". NettleJ The historical background English laws According to the strict logic of the common law, all "pleas of the Crown" were prosecuted "pro rege", or in the "name or right" of the King or Queen, "as the common vindex of public injuries or crimes"51. As Wilmot LCJ proclaimed52 on behalf of all the Judges present in the House of Lords in Wilkes v The King: "By our constitution, the King is entrusted with the prosecution of all crimes which disturb the peace and order of society. He sustains the person of the whole community, for the resenting and punishing of all offences which affect the community; and for that reason, all proceedings 'ad vindictam et poenam' are called in the law, the pleas or suits of the Crown; and in capital crimes, these suits of the Crown must be founded upon the accusation of a grand jury; but in all inferior crimes, an information by the King, or the Crown, directed by the King's Bench, is equivalent to the accusation of a grand jury, and the proceedings upon it are as legally founded; this is solemnly settled and admitted. As indictments and informations, granted by the King's Bench, are the King's suits, and under his controul; informations, filed by his Attorney General, are most emphatically his suits, because they are the immediate emanations of his will and pleasure. They are no more the suits of the Attorney General than indictments are the suits of the grand jury." Although brought in the name of the Crown, however, the conduct of a prosecution pro rege was, in the typical case, left to the victim of the crime or his or her agent53. As Sir Patrick Devlin remarked54, "the great majority of prosecutions are in theory private", but "even the prosecution that is initiated and conducted by a private individual is brought in the name of the Crown". Thus, generally speaking, a bill of indictment for felony or misdemeanour was "preferred ... in the name of the king, but at the suit of any private 51 Hale, The History of the Pleas of the Crown (1736), vol 1, proemium. 52 (1768) Wilm 322 at 326 [97 ER 123 at 125]. 53 Chitty, A Practical Treatise on the Criminal Law (1816), vol 1 at 1. See also Hay, "Controlling the English Prosecutor" (1983) 21 Osgoode Hall Law Journal 165 at 54 Devlin, The Criminal Prosecution in England (1960) at 16-17. NettleJ prosecutor"55. Thereafter, the grand jury, or jury of presentment – which ordinarily "comprised 23 persons summonsed by the sheriff to consider whether there were grounds for suspicion that the person presented had committed an offence" – acting by majority, would return the bill endorsed as a "true bill", "upon which the accused was put on his trial", or with the word ignoramus ("we do not know"), "upon which no further proceedings were taken"56. Alternatively, in respect of misdemeanours, a private person was generally entitled to procure an information directly "for the punishment of public crimes"57 albeit that that right was perennially subject to statutory regulation. In the aftermath of the Revolution of 1688, s 2 of 4 & 5 Will & Mar c 18 was passed to check abuses by requiring prosecutors to obtain the leave of the court before an information was exhibited58. Then, from the late 18th century, Parliament began to provide against the same mischief by requiring that informations to enforce penalties under particular Acts be prosecuted "in the Name of his Majesty's Attorney General"59. Provisions60 to that effect in laws on "Corresponding Societies" have since been described61 as having "introduced a requirement for the consent of the Attorney-General to any penal actions for sedition, or its encouragement". Such requirement for consent, however, in no sense excluded the right of private prosecution. In that respect, the decision of the powerfully constituted 55 Blackstone, Commentaries on the Laws of England, 9th ed (1783), vol 4 at 303. 56 Bell, "Section 80 – The Great Constitutional Tautology" (2014) 40 Monash University Law Review 7 at 16, fn 78, citing Holdsworth, A History of English Law, 7th ed (1956), vol 1 at 321-323. 57 Blackstone, Commentaries on the Laws of England, 9th ed (1783), vol 4 at 313. See also vol 3 at 161-162, describing these actions as "popular", "because they are given to the people in general", and "qui tam", "because ... brought by a person 'qui tam pro domino rege, &c quam pro se ipso in hac parte sequitur'" ("who prosecutes this suit as well for the lord king, etc as for himself"). 58 Liston v Davies (1937) 57 CLR 424 at 433-434 per Dixon J; [1937] HCA 22. 59 Lottery Act 1793 (33 Geo III c 62), s 38. 60 Printers and Publishers Act 1839 (UK) (2 & 3 Vict c 12), s 4; Seditious Meeting Act 1846 (UK) (9 & 10 Vict c 33), s 1. 61 Hay, "Controlling the English Prosecutor" (1983) 21 Osgoode Hall Law Journal NettleJ Divisional Court in R v Kennedy, a Metropolitan Magistrate62, concerning ss 34 and 38 of the Roman Catholic Relief Act 1829 (UK)63, is instructive. The former provision created the extraordinary offence of being a Jesuit which, upon conviction, rendered the offender liable to be banned from the Kingdom for the term of his natural life. The latter provided that "all Penalties ... shall and may be recovered as a Debt due to His Majesty, by Information to be filed in the Name of His Majesty's Attorney General". At first instance, the Magistrate held that, having regard to the very peculiar nature of the offence, s 38 should be taken to mean that proceedings could only be instituted by the Attorney-General acting as such. On appeal, the Divisional Court held unanimously that the Magistrate was wrong. Lord Alverston CJ stated64 that: "Its provisions are, of course, unique, and we have no practice under it, which can be said to be any contemporaneous exposition or interpretation of it ... For myself I wish to say that I by no means suggest that it is any legal bar to proceedings in the case that they are taken by a private individual. If the magistrate had proceeded upon the view that the Crown, and the Crown only, could take proceedings, I think he would have been wrong". the "I think [the Magistrate] did express in one part of his judgment the opinion that proceedings could not under this Act of Parliament be initiated at the Attorney-General acting as such. In that I desire to say I think he was wrong. If he held that opinion, and I think he did, and I think in one place he expressed it, I think he was wrong. To my mind it is clear that the Act is open to enforcement by a private individual". instance of a private person, but only by To the same effect, Channell J said66: "as [s 34] is put in the form of a criminal offence, it appears to me that a private individual is entitled to prosecute for it. ... [I]t is an important 63 10 Geo IV c 7. 64 (1902) 86 LT 753 at 757. 65 (1902) 86 LT 753 at 757. 66 (1902) 86 LT 753 at 759. NettleJ constitutional principle that a private individual may set the criminal law in motion – at his own risk in certain cases, of course, but that he may do so. ... [E]xcept where the special terms of the Act of Parliament direct the contrary (of which there are some instances) a private individual may institute criminal prosecutions". At the same time, the Attorney-General continued to enjoy the privilege of prosecuting grave misdemeanours by an ex officio information in the King's Bench, a process that "eliminated the grand jury, could allow the careful packing of a special jury, and saddled the defendant with heavy costs even if the Crown lost"67. Colonial Australian laws From the outset, the position in Australia was largely the same68. As was observed in R v Walton69: "In England the Queen prosecutes; a county may prosecute, or a single individual, but still in every case the Crown really prosecutes; and even the Grand Jury prosecutes for the Crown. After the information is filed, if a private prosecutor comes into Court, he may be permitted to prosecute for the Crown. But when a bill has been found, it is unnecessary for any person to conduct the prosecution ministerially. We are just in the same position here with regard to a prosecution after the bill is found as they are in England." In the Colony of New South Wales, the functions of the Attorney-General with respect to the prosecution of criminal offences derived from Imperial 67 Hay, "Controlling the English Prosecutor" (1983) 21 Osgoode Hall Law Journal 68 See Davis v Gell (1924) 35 CLR 275 at 283 per Isaacs A-CJ; [1924] HCA 56, quoting Gaya Prasad v Bhagat Singh (1908) ILR 30 All 525 at 533-534 per Sir Andrew Scoble for the Privy Council. 69 (1851) 1 Legge 706 at 707 per Stephen CJ. NettleJ statutes70. Notably, in 1828, the Imperial Parliament enacted the Australian Courts Act 1828 (Imp)71, of which s 5 provided that: "until further Provision be made as hereinafter directed for proceeding by Juries, all Crimes, Misdemeanors, and Offences, cognizable in the said Courts respectively, shall be prosecuted by Information, in the Name of His Majesty's Attorney General, or other Officer duly appointed for such Purpose by the Governor of New South Wales and Van Diemen's Land respectively ..." Section 6 provided relevantly and in substance that any person might also exhibit a criminal the Attorney-General by obtaining the leave of the Supreme Court. information against another person the name of to enter a nolle prosequi, as being In Beckett v New South Wales, French CJ, Hayne, Crennan, Kiefel and Bell JJ described72 the purpose of s 5 of the Australian Courts Act, insofar as it conferred power on the Attorney-General to prosecute offences on ex officio "indictment"73 and the Attorney-General for New South Wales and Crown Prosecutors appointed by him with a power in all respects similar to that enjoyed by the Attorney-General in England. In respect of indictable offences, s 5 also operated as "an interim measure pending the Attorney-General the function of the grand jury to find or ignore a bill75. In that respect, as Stephen CJ noticed76 in R v Macdermott, the enactment of s 5 meant the constitution of grand juries"74, vesting to arm 70 Beckett v New South Wales (2013) 248 CLR 432 at 446 [30] per French CJ, Hayne, Crennan, Kiefel and Bell JJ; [2013] HCA 17, citing New South Wales Act 1823 (Imp) (4 Geo IV c 96), s 4 and Australian Courts Act 1828 (Imp) (9 Geo IV c 83), 71 9 Geo IV c 83. 72 (2013) 248 CLR 432 at 446 [30], citing Barton v The Queen (1980) 147 CLR 75 at 92 per Gibbs A-CJ and Mason J; [1980] HCA 48. 73 In part because of this provision, the words "information" and "indictment" had become synonymous in this context: see Fraser v The Queen [No 2] (1985) 1 NSWLR 680 at 690-691 per McHugh JA; R v Hull (1989) 16 NSWLR 385 at 388-390 per Gleeson CJ (Grove and Studdert JJ agreeing at 396). 74 Grassby v The Queen (1989) 168 CLR 1 at 13 per Dawson J; [1989] HCA 45. 75 R v Shanahan (1861) 2 Legge 1454 at 1454 per Stephen CJ. 76 (1844) 1 Legge 236 at 237. NettleJ that "until the establishment of a Grand Jury, the powers and functions of that body [were] vested exclusively in one officer, without supervision, limitation, or control". As events later transpired, no provision was ever made in New South Wales for the establishment of a grand jury – with the result, consistently recognised77 in early decisions of the Supreme Court of New South Wales, that, in "giving the power to the Attorney-General to prosecute", s 5 of the Australian Courts Act provided in effect that "the Attorney-General, or the person who stands in his place, signs the bill, that is to say, like a Grand Jury he finds billa vera". Approving this line of authority, in Commonwealth Life Assurance Society Ltd v Smith a majority of this Court stated78 that "[u]nder the law of New South Wales there is no grand jury, and the Attorney-General discharges a duty analogous to or replacing that which, under the common law, was performed by a grand jury". Although the Attorney-General for New South Wales thus came to occupy the dual "functions of a grand jury and of a public prosecutor"79, each function remained distinct. The statutory imperative that offences "be prosecuted by Information in the Name of His Majesty's Attorney General" in no sense required that, if the Attorney-General found a bill and filed an information in his former capacity, he should thereafter maintain the conduct of the prosecution in his latter capacity80. True it was that, having found a bill and filed an information, the Attorney-General was entitled to maintain the conduct of a prosecution to the exclusion of any private prosecutor, and the Supreme Court "had no power to interfere with this exercise of such duty"81. But as was stated82 in R v Shanahan: 77 Walton (1851) 1 Legge 706 at 707 per Stephen CJ. See R v Cummings (1846) 1 Legge 289 at 292 per Stephen CJ; R v Ellis (1852) 1 Legge 749 at 749-750 per Stephen CJ, Dickinson and Therry JJ; R v Lang (1859) 2 Legge 1133 at 1134 per Stephen CJ; Shanahan (1861) 2 Legge 1454 at 1454 per Stephen CJ; R v McKaye (1885) 6 LR (NSW) L 123 at 127 per Martin CJ; R v Baxter (1904) 5 SR (NSW) 134 at 135 per Darley CJ; R v Woolcott Forbes (1944) 44 SR (NSW) 333 at 337 per Jordan CJ. See also R v Canan [1918] VLR 390 at 391 per Cussen J. 78 (1938) 59 CLR 527 at 543 per Rich, Dixon, Evatt and McTiernan JJ; [1938] HCA 79 Lang (1859) 2 Legge 1133 at 1134. 80 See Macdermott (1844) 1 Legge 236 at 237 per Stephen CJ. 81 Lang (1859) 2 Legge 1133 at 1135 per Stephen CJ. NettleJ "the filing of the information was a distinct act from its after prosecution by counsel for the Crown. The Attorney-General, or other representative of the Crown, having placed the information upon the files of the Court his statutory functions ceased, and he might, if he thought fit, hand over the further prosecution of it to the parties concerned." Where that occurred, the prosecution was continued by the private person in the name of the Attorney-General83. Moreover, where the Attorney-General declined to exercise his power under s 5, the private person could apply to the Supreme Court for leave to file a criminal information "in the name of" the Attorney-General under s 684. And although "the exercise of that jurisdiction" was "always held to be purely discretionary"85, its existence provides a further early demonstration of the fact that anyone duly authorised to proceed in the Attorney-General's name could do just that. Commonwealth laws Section 69 of the Judiciary Act has been described86 as providing the "same general system" for the institution of prosecutions for Commonwealth As Taylor J held87 in offences as s 5 of the Australian Courts Act. Bainbridge-Hawker v The Minister of State for Trade and Customs, it "contemplates the use of the personal name of the Attorney-General or of such other person who may have been so appointed". The relationship between s 69 of the Judiciary Act and s 13 of the Crimes Act was described88 by Isaacs J in R v Judd in the following terms: 82 (1861) 2 Legge 1454 at 1454 per Stephen CJ. 83 See, eg, Walton (1851) 1 Legge 706 at 707 per Stephen CJ. 84 See and compare 4 & 5 Will & Mar c 18, s 2. 85 McKaye (1885) 6 LR (NSW) L 123 at 125-126 per Martin CJ. 86 Pannam, "Trial by Jury and Section 80 of the Australian Constitution" (1968) 6 Sydney Law Review 1 at 8. 87 (1958) 99 CLR 521 at 558; [1958] HCA 60. 88 (1919) 26 CLR 168 at 172; [1919] HCA 9. NettleJ "As to summary procedure, that was provided for by sec 13 of the Crimes Act 1914, which allowed any person to institute proceedings; and as to indictment, that was found in sec 69 of the Judiciary Act, which provided that indictments should be in the name of the Attorney-General or of some person commissioned by the Governor-General." The matter in issue in Judd concerned the effect of s 6(3A) of the War Precautions Act 1914 (Cth). It provided that: "An offence against this Act shall not be prosecuted summarily without the written consent of the Attorney-General or the Minister for Defence, or a person authorized in writing by the Attorney-General or the Minister for Defence, and an offence against this Act shall not be prosecuted upon indictment except in the name of the Attorney-General." Isaacs J held89 that the purpose of s 6(3A) was to provide "a safeguard to the individual", by ensuring that: "no prosecution should be instituted either summarily or by indictment, except by executive authority. To carry that out, they provided that summary procedure should be with the written consent of a Minister of State, either the Attorney-General or the Minister for Defence, specially named, or some person under the written authority of one of those Ministers of State; and that in the case of an indictment it should be in the name of the Attorney-General, cutting out for the purpose of the Act the provision in sec 69 of the Judiciary Act as to a person who was commissioned by the Governor-General. That left the whole thing really in the hands of the Executive Government." Likewise, Gavan Duffy J observed90 that: "Sec 6(3A) ... gives no new power to the Attorney General, but in certain cases forbids prosecution by indictment in the name of any person other than the Attorney General." It is arguable that the combination of s 268.121(1) and (2) of the Code is similar in effect to s 6(3A) of the War Precautions Act. By its reference to an offence being prosecuted only in the name of the Attorney-General, s 268.121(2) may be seen to maintain what Dixon J described91 as the "great distinction in 89 Judd (1919) 26 CLR 168 at 172. 90 Judd (1919) 26 CLR 168 at 173. 91 Munday v Gill (1930) 44 CLR 38 at 86; [1930] HCA 20. NettleJ history, in substance and in present practice between summary proceedings and trial upon indictment" – the former being "a proceeding between subject and subject" and the latter being concerned with the "highest crimes by which the State may be affected and the gravest liabilities to which a subject may be exposed", which must be brought in the Attorney-General's name as a "plea[] of the Crown ... solemnly determined according to a procedure considered appropriate [thereto]". If so, in the case of summary proceedings (relevantly, for an indictable offence triable summarily) or proceedings for the commitment of an accused for trial on indictment, s 268.121(1), like the first part of s 6(3A) of the War Precautions Act, would require that the informant first seek and obtain the Attorney-General's consent to the commencement of the proceeding and, in the case of indictable offences, s 268.121(2), like the latter part of s 6(3A) of the War Precautions Act, would forbid prosecution by indictment in the name of anyone other than the Attorney-General. Neither sub-section would exclude the right of private prosecution. It is also arguable, however, that the omission of the words "by indictment" from s 268.121(2) should be taken to signify that s 268.121(2) extends to summary proceedings which are alternative or preliminary to a prosecution upon indictment. But if so, there would still be no exclusion of the right of private prosecution. For there would be no reason to suppose that s 268.121(2) (any more than s 6(3A) of the War Precautions Act or s 5 of the Australian Courts Act) excludes the ability of a private person to seek the consent of the Attorney-General to commence proceedings for summary conviction or commitment or the ability of the Attorney-General to permit a private person to conduct a prosecution, whether summarily or on indictment, in the name of the Attorney-General. Of course, whether or not the Attorney-General would choose to do so is another matter, but it is evident that s 268.121(2) was intended to leave that option open to him or her. The point is emphasised by the observations of Griffith CJ in Christie v Permewan, Wright & Co Ltd92, being one of the earliest decisions in this Court considering the effect of Commonwealth legislation specifying that a proceeding could be instituted only in the name of a designated officer: "It is to be observed that sec 245 [of the Customs Act 1901 (Cth)] only requires prosecutions to be instituted in the name of the Collector. It does not require any particular person to lay the information personally any more than it requires the Minister to go into Court to institute the 92 (1904) 1 CLR 693 at 700; [1904] HCA 35. NettleJ prosecution. There is nothing in the Customs Act to say that the power conferred on the Collector cannot be exercised by some other person for and on behalf of the Collector." Such legislation stands impose in contrast "an absolute restriction upon the right to prosecute". As the Australian Law Reform Commission noted93 in its 1985 Report into Standing in Public Interest Litigation: to provisions which "365. Consent Provisions in Australia. A search by the Commission has identified a number of instances of Commonwealth Acts and regulations and Ordinances of the Australian Capital Territory requiring official consent to prosecution. These are listed in Appendix B. In most cases the provision requiring consent refers to several, if not all, offences under the relevant Act, regulations or Ordinance, so that the number of offences covered by consent provisions is more extensive than is indicated by this figure. In most cases the official empowered to consent to prosecution is the Attorney-General, although in some cases it is the Treasurer, another Minister or a senior public servant, such as the Secretary to the relevant department. Often the consent may be provided by an officer so authorised by the designated official. In other cases legislation places an absolute restriction upon the right to prosecute, permitting prosecution only in the name of the designated official, whether it be the Attorney-General, the Director of Public Prosecutions, the Minister or a senior public servant, such as the Commissioner of Taxation. This absolute restriction most often appears in legislation relating to taxation. Appendix B provides a list of the relevant Acts. Under the Director of Public Prosecutions Act 1983 (Cth) persons having the power to consent to prosecutions for particular offences may authorise the Director to consent to prosecutions for those offences without surrendering their own power to give such consent. Certain of the Acts containing consent provisions are amended by the Director of Public Prosecutions (Consequential Amendments) Act 1983 (Cth) so as explicitly to empower the Director, usually in addition to the Attorney-General, to consent to prosecutions." The contextual indications Those conclusions are fortified by the fact that, at the time of drafting s 268.121, the drafters would almost certainly have had in front of them the 93 Australian Law Reform Commission, Standing in Public Interest Litigation, Report No 27 (1985) at 194 [365] (footnotes omitted; emphasis added). NettleJ the consent of forms of legislation earlier enacted in New Zealand, the United Kingdom and Canada to give effect to those countries' respective obligations under the Rome Statute of the International Criminal Court (1998). Tellingly, the New Zealand legislation barred proceedings commenced "without the Attorney-General"94, and, yet more tellingly, the United Kingdom legislation barred proceedings instituted otherwise than "by or with the consent of the Attorney General"95. As might be expected, the latter form of provision has since been interpreted96 in England to mean that proceedings cannot be commenced without the consent of the Attorney-General. Canada's legislation was alone in providing in terms that such proceedings could be "conducted only by the Attorney General"97 or counsel on his or her behalf. And since the drafters did not adopt the Canadian form of words, but rather combined the United Kingdom and New Zealand pattern with a provision, long familiar in this country, for the institution of proceedings in the name of the Attorney-General, the logical conclusion is that they eschewed the Canadian approach in favour of the more orthodox United Kingdom and New Zealand course of retaining the private right of prosecution and subjecting the Attorney-General's consent. to a requirement first to obtain If s 268.121(2) were to be read as restricting prosecution to that by the Attorney-General in the manner of the Canadian provisions, it is difficult to see why s 268.121(2) excludes private prosecutions but does not also prevent prosecutions by the Commonwealth Director of Public Prosecutions, the police and any Special Prosecutor – there are no stated exceptions for these entities in s 268.121(2). That the Director of Public Prosecutions might, under s 9(1) of the Director of Public Prosecutions Act 1983 (Cth), bring proceedings "in any other manner" than in his or her own official name does not address the issue: the Director of Public Prosecutions is not the Attorney-General. Indeed, the police, at least, are expected to play some role under s 268.121, as contemplated by s 268.121(3), which permits actions such as arrest and charge before the Attorney-General's consent has been given. For these reasons, as well, the better construction is that s 268.121(2) does not exclude prosecutions by persons other than the Attorney-General. 94 International Crimes and International Criminal Court Act 2000 (NZ), s 13(1). 95 International Criminal Court Act 2001 (UK), s 53(3) (emphasis added). 96 R v Jones [2007] 1 AC 136 at 162 [28] per Lord Bingham of Cornhill. 97 Crimes Against Humanity and War Crimes Act 2000 (Can), s 9(3) (emphasis added). NettleJ That conclusion is in turn reinforced by the fact that, had s 268.121(2) been intended to have the effect that proceedings can only be brought by the Attorney-General, there would be little point in expressly providing in s 268.121(1) that proceedings cannot be commenced without the consent of the Attorney-General; and, although there might be several reasons for providing in s 268.122 that a decision of the Attorney-General to grant or withhold consent is not reviewable, the most likely explanation of it is surely that it was intended to prevent a private person who wishes to take proceedings for an offence against Div 268 disputing a decision by the Attorney-General not to consent. The Solicitor-General contended that the probable explanation of the inclusion of s 268.121(1) is that, under s 17(2) of the Law Officers Act 1964 (Cth), the Attorney-General may either generally or otherwise by writing under his or her hand delegate all or any of his or her powers and functions, and thus that it is possible that the Attorney-General may delegate his or her powers to prosecute persons for offences against Div 268. It was submitted that, in view of the nature of the offences proscribed by Div 268, it may be inferred that Parliament considered it desirable that the Attorney-General maintain individual control over such proceedings, and hence that the likely purpose of s 268.121(1) is to ensure that delegates seek individual consent before the institution of each such proceeding. That contention is unconvincing. If that were the point of the consent requirement, it is only to be expected that s 268.121(1) would be directed specifically to delegates or would be drafted in terms which require the Attorney-General to make a delegation of power to prosecute Div 268 offences subject to a requirement that the delegate obtain consent before the institution of proceedings. It is unlikely that s 268.121(1) would be drafted, as it is, in a form which has been interpreted repeatedly over centuries as one directed to private persons seeking to institute criminal proceedings with the consent of a designated Law Officer. The Solicitor-General also referred to s 12 of the War Crimes Act 1945 (Cth), which provides that: "Who may prosecute An offence against this Act may only be prosecuted in the name of the Attorney-General or the Director of Public Prosecutions." The Solicitor-General contended that it is apparent from the similarity between the form of s 268.121(2) of the Code and the form of s 12 of the War Crimes Act, coupled with the meaning which the Explanatory Memorandum to the War Crimes Amendment Bill 1987 (Cth) ascribed to s 12 of the War Crimes Act, that s 268.121(2) of the Code was intended to have the same meaning as the NettleJ Explanatory Memorandum to the War Crimes Amendment Bill ascribed to s 12 of the War Crimes Act. That contention should also be rejected. On any view, s 12 of the War Crimes Act achieves the specific purpose identified in its heading – to regulate "[w]ho may prosecute" – because some lawful authority must be necessary to proceed in the name of the Attorney-General. Beyond that, however, the heading does no more than point to the question identified above as to what "prosecute" means in this context. What is far more telling is that s 12 of the War Crimes Act is in a form which, as has been explained, has long existed and long been understood to do no more than forbid particular proceedings in the name of any person other than the Attorney-General. It is true, as the Solicitor-General contended, that the Explanatory Memorandum to the War Crimes Amendment Bill stated that the effect of s 12 of the War Crimes Act is that proceedings for an offence against that Act may be brought only by the Attorney-General or the Director of Public Prosecutions. But that can hardly be regarded as a sufficient indication of its meaning. For the reasons given, s 12 of the War Crimes Act is not ambiguous or obscure. Nor could it be said that its natural and ordinary meaning, supported by centuries of experience, leads to any manifestly absurd or unreasonable result. Hence, s 15AB of the Acts Interpretation Act 1901 (Cth) supplies no basis for considering this extrinsic material, much less attaching dispositive weight to it. And, although this Court has acknowledged98 a role for context in the first instance, it has also steadfastly maintained99 that the meaning of the statutory text cannot be displaced by legislative history and extrinsic materials, much less one without the other. The function of the Court is to give effect to the will of the Parliament as expressed in the law, not to bend it to accord to what an officer of the executive may have conjectured to be its meaning100. Furthermore, even if s 12 of the War Crimes Act had the meaning for which the Solicitor-General contended, s 268.121 is very different in form and 98 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408 per Brennan CJ, Dawson, Toohey and Gummow JJ; [1997] HCA 2. 99 Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 at 519 [39] per French CJ, Hayne, Crennan, Bell and Gageler JJ; [2012] HCA 55. 100 Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518 per Mason CJ, Wilson and Dawson JJ; [1987] HCA 12; Singh v The Commonwealth (2004) 222 CLR 322 at 336 [19] per Gleeson CJ; [2004] HCA 43. See also Frankfurter, "Some Reflections on the Reading of Statutes" (1947) 47 Columbia Law Review 527 at 533. NettleJ context from s 12 of the War Crimes Act: in particular, s 268.121(1) expressly provides that a proceeding is not to be commenced without the consent of the Attorney-General, and s 268.122 expressly provides, in a most elaborate form, that a decision of the Attorney-General to consent or not to consent is not reviewable. The inclusion of those features in ss 268.121 and 268.122 compared to their absence from the War Crimes Act supports the conclusion that s 268.121(2) is intended to have its natural and ordinary meaning: relevantly that, if the Attorney-General consents to a private person commencing a proceeding for an offence against Div 268 of the Code, the proceeding may thereafter be commenced only in the name of the Attorney-General. The Solicitor-General argued that the special nature of the offences created by the War Crimes Act and by Div 268 of the Code is a powerful indication that Parliament intended that such offences be prosecuted only by the Attorney-General or, in the case of offences under the War Crimes Act, by the Attorney-General or the Director of Public Prosecutions and, therefore, that s 12 of the War Crimes Act and s 268.121(2) of the Code should be construed as having that effect. That contention is not persuasive either. It may, at the outset, be doubted whether the nature of the offences in Div 268 is any reason for reading s 268.121(2) as not permitting private prosecutions. The purpose of Div 268 is "to create certain offences that are of international concern and certain related offences"101. In the international law context, these offences, which include crimes against humanity and genocide, are sometimes called crimes of universal jurisdiction102. Parliament could readily have viewed the importance of ensuring prosecution of these crimes – because they are of such general concern – as supporting, rather than detracting from, the desirability of private prosecution. While it may be accepted that the offences created by the War Crimes Act and Div 268 of the Code are special, even apart from s 13 of the Crimes Act it is unlikely that the special nature of the offences would be regarded as a sufficient indication of intention to exclude the right of private prosecution. It will be recalled that the Divisional Court in Kennedy was unanimous in holding that the special nature of the offence there in issue was not sufficient to exclude the right of private prosecution. Moreover, and more importantly, whatever may have been the position prior to the enactment of s 13 of the Crimes Act, as has been observed, the 101 Code, s 268.1(1). 102 Crawford, Brownlie's Principles of Public International Law, 8th ed (2012) at NettleJ consequence of the enactment of s 13 is that general probabilities of intention based on the nature of the legislation in question are not sufficient to displace the presumption created by s 13 that any person may institute criminal proceedings. To exclude the right of private prosecution afforded by s 13 requires express terms of exclusion or exclusion as a matter of necessary implication. And here the nature of the offences in issue does not so imply. Given the manner in which they have been dealt with in the United Kingdom and New Zealand, and that s 268.121 appears as substantially based on a combination of those provisions with a form of words having an established meaning retentive of the right of private prosecution, there is very good reason to conclude that the nature of the offences was not considered sufficient to take away the right of private prosecution. The special nature of the offences created by Div 268 of the Code is relevant, however, in another and more significant respect. Because those offences are the result of Australia giving domestic effect to international crimes recognised by the Rome Statute, Parliament had reason to consider it important that, where proceedings are taken by a private person, the Director of Public Prosecutions or a Special Prosecutor, the defendant should "know from the summons" (or at least any later indictment103) "that the proceedings were both authorized and taken in the name of the Attorney-General"104, as the first Law Officer of Australia. In the absence of contrary indication, a requirement that proceedings not be commenced "without the consent of" the Attorney-General, or only "with the sanction of" or "on the fiat of" the Attorney-General, would not necessarily imply that proceedings to which the Attorney-General has given consent, sanction or fiat must then be commenced in the name of the Attorney-General105. Hence, but for s 268.121(2), proceedings to which the Attorney-General had consented under s 268.121(1) might be commenced in the name of a private prosecutor under a State or Territory law106 applied by s 68 of the Judiciary Act, and then prosecuted by indictment in the name of the Director of Public Prosecutions or a Special Prosecutor under s 69 of the Judiciary Act. Against that background, it appears most likely that the purpose of s 268.121(2) is to ensure that, where the Attorney-General has consented to proceedings under s 268.121(1), the fact that the proceedings are authorised by and taken in the name of the Attorney-General 103 See [74]-[76] above. 104 Key v Bastin [1925] 1 KB 650 at 654 per Avory J. 105 See Key v Bastin [1925] 1 KB 650 at 653-654 per Lord Hewart CJ. 106 See, eg, Criminal Procedure Act 2009 (Vic), ss 5, 6. NettleJ will be apparent from the face of the instrument under which the defendant is prosecuted. Conclusion For these reasons, we should have been disposed to hear the plaintiff's argument as to whether the Attorney-General's refusal to grant consent was reviewable on the grounds alleged. But of course we say nothing as to the merits of that argument. Edelman The preliminary issue Is an offence "prosecuted in the name of the Attorney-General" if, with the consent of the Attorney-General, a private person prosecutes the offence in the name of the Attorney-General? This question was essentially a preliminary issue in this case. It concerns the meaning of s 268.121(2) of the Criminal Code (Cth). Division 268, which contains this provision, was inserted into the Criminal Code in 2002 in connection with Australia becoming a party to the Rome Statute of the International Criminal Court (1998)107. Despite the literal connotation of the expression "in the name of the Attorney-General", and despite the history of the expression, I was attracted during the hearing to the view reached by the majority that the answer to this preliminary question is "no". This was due to the international context in which s 268.121(2) arose, particularly an earlier Canadian provision to which regard was had in drafting s 268.121(2), and which appears to exclude prosecution by private persons in the name of the Attorney- General. But, in the absence of consideration and treatment of the context of the provision in light of the provenance of the expression "in the name of the Attorney-General", I would have reserved my decision on this preliminary issue and would have permitted further argument upon the substantive issues in the special case. I have now considered the preliminary issue in detail and I conclude that the nearly unique international context does not sufficiently reveal an intention by the Commonwealth Parliament to depart from the plain semantic and historical meaning of the words used in s 268.121(2). That meaning, long- established throughout the civil and criminal law, includes the prosecution of a relator proceeding by a private person, albeit controlled by the Attorney-General, for whom, and on behalf of whom, the prosecution is brought. Introduction Section 268.121(2) of the Criminal Code provides that "[a]n offence against this Division may only be prosecuted in the name of the Attorney- General". As I discuss below, this expression has been used, "from the earliest times"108, to describe proceedings that are commenced, and, subject to the 107 Australia, House of Representatives, Parliamentary Debates (Hansard), 25 June 2002 at 4369; see also at 4326, 4349. 108 Gouriet v Union of Post Office Workers [1978] AC 435 at 477. Edelman Attorney-General's control, conducted at the instigation of individuals to enforce public rights. in order the Attorney-General As the majority explain in their recitation of the background to this special case, Mr Taylor's case concerns his attempt to procure the consent and use of the name of to bring a prosecution of Aung San Suu Kyi. At the heel of the hunt, and towards the conclusion of his written submissions, the Attorney-General of the Commonwealth raised a new point. He submitted that s 268.121(2) "excludes the bringing of a private prosecution under s 13 of the Crimes Act [1914 (Cth)] ... because it reveals a contrary intention for the purposes of that section". Following a letter to the parties, this issue was heard as a preliminary issue and the special case was resolved, and questions answered, on the basis of this issue by a majority of this Court. The meaning of s 268.121(2) must be understood with the background of a long history of relator proceedings as well as in its immediate context and in light of its purpose. The history of relator proceedings is one by which the expression "in the name of the Attorney-General" carries the meaning of complete control over the proceedings by the Attorney-General although a private person might act as prosecutor. That control is complete in the sense that the Attorney-General has all the powers that a party to a proceeding would have in the running of the case. The immediate context of s 268.121(2) is that before it was inserted into the Criminal Code in 2002 similar provisions were enacted in the United Kingdom in 2001109, New Zealand in 2000110, and Canada in 2000111. The Australian legislation was clearly drafted with the same international concerns in mind and by reference to those foreign models112. However, neither the legislation of New Zealand nor that of the United Kingdom contains a provision equivalent to the constraint imposed upon a private person by s 268.121(2) that the offence may only be prosecuted "in the name of the Attorney-General". The closest is the provision of the Canadian legislation that requires that "proceedings may be conducted only by the Attorney General of Canada or counsel acting on their behalf"113. Ultimately, in determining the interpretation of s 268.121(2) it is 109 International Criminal Court Act 2001 (UK), ss 53(3), 60(3). 110 International Crimes and International Criminal Court Act 2000 (NZ), s 13(1). 111 Crimes Against Humanity and War Crimes Act 2000 (Can), s 9(3). 112 See Australia, Joint Standing Committee on Treaties, The Statute of the International Criminal Court, Report No 45 (2002) at 82 [3.55]. 113 Crimes Against Humanity and War Crimes Act 2000 (Can), s 9(3). Edelman not necessary to consider whether or not a relator proceeding involves a private person acting on behalf of the Attorney-General as those words are used in the Canadian legislation. The Commonwealth legislation departed from the Canadian expression and instead used an expression wholly consistent with the long history of relator proceedings in the United Kingdom and Australia. There was an evident purpose for the choice of expression by the Commonwealth Parliament: complete control over the proceedings by the Attorney-General without abolition of the prospect of commencement of the proceedings by a private person. The foundations in history and principle of relator proceedings Civil law In Gouriet v Union of Post Office Workers114, Lord Wilberforce drew a distinction of "fundamental principle" between private rights that can be asserted by individuals and public rights that can be asserted by the Attorney-General representing the public. In general, his Lordship said, a private person does not have the right to represent the public115. Lord Wilberforce also appeared to recognise one exception to the general proposition that individuals can only assert their private rights. That apparent exception is where "the defendant is infringing or threatens to infringe some public right so as to inflict special damage on the plaintiff"116. The extent to which this is an exception may depend upon the extent to which "special damage" or a "special interest" goes beyond a plaintiff's rights in a broad sense, including liberties, powers and immunities. In Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd117, McHugh J took a similar view, saying of this "foundational principle" that "the Attorney-General of the relevant jurisdiction is regarded as the appropriate person to determine whether civil proceedings should be commenced to enforce the public law of the community"118. In contrast, in a joint judgment, Gaudron, Gummow and Kirby JJ, without reference to the exception recognised by Lord Wilberforce, said that one difficulty with the 114 [1978] AC 435 at 477. 115 Gouriet v Union of Post Office Workers [1978] AC 435 at 477; see also at 500 per Lord Diplock. 116 Gouriet v Union of Post Office Workers [1978] AC 435 at 483. 117 (1998) 194 CLR 247; [1998] HCA 49. 118 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 276 [82]. Edelman reasoning in Gouriet was that it had left no room for the "special interest" and "appears to reflect a view of standing which sees administrative review as concerned with the vindication of private not public rights"119. In any event, however, it was unanimously held in Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd that the respondents had sufficient interest to seek relief by application of the "flexible"120 rule that an individual can assert public rights where the individual has a "special interest in the subject matter of the action"121. Subject to statutory provisions and constitutional considerations, and with differences in its application at the margins, English and Australian law represent the same general civil law principle. The principle is that an individual without a sufficient special interest cannot enforce public rights in a civil action. In such a case, the public rights must be asserted by the Attorney-General, either ex officio (from his office) or ex relatione (at the instance of another). Thus, where an individual without a special interest seeks to agitate for the enforcement of public rights, that proceeding must be brought by the Attorney-General at the relation of that individual. Criminal law Writing in the late nineteenth century, Stephen observed that in Continental legal systems "prosecutions having punishment for their object can be instituted only by public authority, but ... a person injured by a crime may join in the prosecution as the parti civile, under certain rules"122. That approach to the criminal law has a distinct similarity with the civil law approach discussed above, where public rights are generally only able to be enforced by a private person 119 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 261-262 [37]. 120 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 265 [46], quoting Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA) (1995) 183 CLR 552 at 558; [1995] HCA 11. See also Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 36; [1981] HCA 50. 121 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 267 [50], 283-284 [100]-[103], 284-285 [108]-[110]. See also Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 526-527; [1980] HCA 53; see also at 547; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 35-36, 68-69, 74-76. 122 Stephen, A History of the Criminal Law of England (1883), vol 1 at 495. Edelman whose rights are affected. However, the position in English criminal law, which was received and adapted in Australia, evolved in a more complex manner. In some instances in English law individuals could bring a criminal proceeding in their own name to assert their own rights. One proceeding, although "little in use"123 by the time of Blackstone, was the "appeal of felony", an original suit by the injured party, commenced by writ or bill, to recover a pecuniary amount from an offender124. That proceeding was "conducted like other private litigations"125. More common was a proceeding under a statute that entitled a prosecutor to recover a penalty or compensation. In those cases, the prosecutor could bring, in their own name126, a criminal information, "informing" the court of facts127 and complaining of serious misdemeanours without the requirement of an indictment sanctioned by a grand jury128. Later statutes confined the bringing of some criminal informations in a person's own name to those people who were enforcing their own rights. For instance, in 1861, the Offences against the Person Act 1861 (UK) required a prosecution for summary offences for common assault or battery, which would exclude the individual's civil claim for assault129, to be prosecuted "by or on behalf of" the victim130. Apart from actions instigated by an individual to vindicate their own rights or to obtain a financial recompense, common law principles also permitted a criminal law proceeding to be brought at the relation of an individual, including one who was not directly affected, to vindicate public rights. As Blackstone explained131, criminal informations brought were of two types: (i) informations 123 Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 23 at 308. 124 Baker, The Legal Profession and the Common Law: Historical Essays (1986) at 125 Stephen, A History of the Criminal Law of England (1883), vol 1 at 496. 126 Paul, Justices of the Peace (1936) at 166. See Bere and Chitty, Burn's Justice of the Peace and Parish Officer, 29th ed (1845), vol 1 at 962. 127 Holdsworth, A History of English Law, 3rd ed (1944), vol 9 at 236. 128 Chitty, A Practical Treatise on the Criminal Law (1816), vol 1 at 841-842. 129 Williams, "The Power to Prosecute" [1955] Criminal Law Review 596 at 598; Nicholson v Booth and Naylor (1888) 16 Cox CC 373 at 376-377. 130 Offences against the Person Act 1861 (UK), s 42. 131 Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 23 at 304-305. Edelman filed by the Attorney-General ex officio, usually132 for "political"133 offences tending to disturb the government134, offences "so high and dangerous, in the punishment or prevention of which a moment's delay would be fatal", and (ii) "those in which, though the king is the nominal prosecutor, yet it is at the relation of some private person or common informer" that the Master of the Crown Office files the information135. In general, and subject to contrary statutory indication, the enforcement of an enactment made for the benefit of the public at large could occur on the relation of any member of the public136. Although the proceedings were styled with the King as the nominal prosecutor, the named prosecutor was the Master of the Crown Office, in whose name the relator's information was filed: he was "the officer of the public, as the Attorney general is the minister of the crown"137. Where a criminal proceeding did not (or, in the case of a felony, could not) arise by a criminal information, it would commonly arise by an indictment. The difference between criminal informations and the "more usual course of indictment" was that an indictment could only be issued by a jury and usually a grand jury, whereas a criminal information was the "mere allegation of the officer by whom it is preferred"138. Although individuals were involved in the prosecution on an indictment it was not a relator procedure. It was the grand jury which would indict, and it did so either by its own knowledge, or on the basis of a draft bill prepared by clerks on behalf of the complainant prosecutor139, who 132 Barton v The Queen (1980) 147 CLR 75 at 92; [1980] HCA 48. 133 See also Maitland, Justice and Police (1885) at 143. 134 Chitty, A Practical Treatise on the Criminal Law (1816), vol 1 at 845. 135 Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 23 at 304. See also Gouldham v Sharrett [1966] WAR 129 at 134. 136 Bere and Chitty, Burn's Justice of the Peace and Parish Officer, 29th ed (1845), vol 1 at 962; Paul, Justices of the Peace (1936) at 166; Sargood v Veal (1891) 17 VLR 660 at 662; Steane v Whitchell [1906] VLR 704 at 705-706. 137 Chitty, A Practical Treatise on the Criminal Law (1816), vol 1 at 849. See also R v Wilkes (1770) 4 Burr 2527 at 2570 [98 ER 327 at 351]. 138 Chitty, A Practical Treatise on the Criminal Law (1816), vol 1 at 841-842. See also Baker, The Legal Profession and the Common Law: Historical Essays (1986) 139 Baker, The Legal Profession and the Common Law: Historical Essays (1986) at Edelman might also be a justice of the peace140. Once a bill had been sent to a grand jury the matter would be "entirely out of the original prosecutor's hands"141. The prosecutor did not even have a right to address the jury142. Indeed, in the period up to the nineteenth century the Crown was not generally represented by counsel at trial143. The relator proceeding, by which any member of the public could bring a criminal information in the name of the Master of the Crown Office, was regarded as so badly misused in the second half of the seventeenth century for frivolous or malicious prosecutions that144, in 1692145, Parliament made the process of exhibiting a criminal information subject to the leave of the court146. This requirement of leave had the effect of confining the criminal relator informations, which "by leave of the court, are prosecuted in the name of the coroner or master of the crown office"147, to those "'gross and serious misdemeanours which deserve the most public animadversion', such as riot or sedition"148. In the nineteenth century, and with increasing frequency in the twentieth century, a further restriction was imposed on criminal relator informations in circumstances where governmental interests were involved, such as official secrets, or where it was thought that the right to prosecute might be "used very 140 Langbein, "The Origins of Public Prosecution at Common Law" (1973) 17 American Journal of Legal History 313 at 318. 141 Stephen, A History of the Criminal Law of England (1883), vol 1 at 496. 142 Gouldham v Sharrett [1966] WAR 129 at 133, citing R v Brice (1819) 2 B & Ald 143 Baker, The Legal Profession and the Common Law: Historical Essays (1986) at 144 Baker, The Legal Profession and the Common Law: Historical Essays (1986) at 266; Holdsworth, A History of the English Law, 3rd ed (1944), vol 9 at 242-245. 145 Statute 4 & 5 Will & Mary c 18. 146 Liston v Davies (1937) 57 CLR 424 at 434; [1937] HCA 22. 147 Chitty, A Practical Treatise on the Criminal Law (1816), vol 1 at 844. 148 Baker, The Legal Profession and the Common Law: Historical Essays (1986) at 266. See also Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 23 at 304-305. Edelman injuriously", such as incest149. In those cases, Parliament required the additional safeguard of consent, usually of the Attorney-General, to be obtained even before the proceeding is commenced150. In 1981, a Royal Commission in the United Kingdom observed that there were more than 100 Acts of the Parliament of the United Kingdom where a private citizen's liberty to prosecute was subject to a requirement of consent "of a Minister, usually the Attorney General, an official, the Director of Public Prosecutions, or a judge"151. In 1998 the Law Commission of England and Wales recommended that a requirement of consent of the Attorney-General should be used to control prosecutions for those offences which involve national security or some international element or which create a high risk that the right of prosecution by an individual will be abused causing irreparable harm152. The relator proceeding in English criminal law thus came to follow, broadly, a similar pattern to that of the civil law. Private individuals did not generally have a right to bring their own action to enforce public rights. The process by which a private individual could vindicate public rights in court was by a relator proceeding brought in the name of the Attorney-General (civil law) or the Master of the Crown Office (criminal law). However, the abuse of the relator proceeding in criminal law saw the introduction of a requirement of leave of the court. And, in cases where governmental interests were involved, a requirement of consent of the Attorney-General was introduced in some statutes. The nature of the relator proceeding Whether the proceeding is civil or criminal, the relator proceeding is, as the name suggests, a proceeding by which a person, company or local or public authority can "'relate' facts to the Attorney-General tending to show that someone ... is breaking the law"153. As I have explained, in civil proceedings the facts are related to the Attorney-General, in whose name the proceeding is brought, but in criminal relator proceedings brought by criminal informations, the English 149 Devlin, The Criminal Prosecution in England (1960) at 18. 150 English examples concerning obscenity and breaches of the peace include the Children and Young Persons (Harmful Publications) Act 1955 (UK), s 2(2); Theatres Act 1968 (UK), s 8. 151 United Kingdom, Royal Commission on Criminal Procedure, Report (1981) Cmnd 8092 at 161 [7.48]. 152 Law Commission, Consents to Prosecution (1998) at 61-62 [6.46], 63 [6.52]. 153 Aronson, Groves and Weeks, Judicial Review of Administrative Action and Government Liability, 6th ed (2017) at 1001 [16.140]. Edelman tradition was that an individual related the facts to the court in the name of the Master of the Crown Office and prosecuted the case in the name of the Master of the Crown Office, with the leave of the court. The English criminal tradition was altered in 1823, in its application in New South Wales, and aligned with the tradition for civil law, by legislation which required "all Crimes [felonies], Misdemeanors and Offences cognizable in the said Courts" to be prosecuted in the name of the Attorney-General154. Indictments were presented by a grand jury in the Courts of Sessions of the Peace but they had not been adopted in the Supreme Court155. From 1823, in the Supreme Court the Attorney-General would proceed for all offences either (i) ex officio, or (ii) by a relator proceeding prosecuted in his name rather than in the name of the Master of the Crown Office. In R v Howe156, Forbes CJ is recorded as considering that in the relator proceeding for libel before him there was "little doubt of the propriety of leaving the trial to the exertions of the private prosecutor" as "would be the course in England" although he noted that, unlike in England, the prosecution in New South Wales would be in the name of the Attorney-General. The grand jury was soon found to be "unsuited to the circumstances of the colony"157 and the 1823 legislation was superseded in 1828 by a new Act, the Australian Courts Act 1828 (Imp)158, which, although in s 10 it recognised the possibility that the Governor of New South Wales or Van Diemen's Land might "further ... extend" the use of the grand jury, also conferred upon the Supreme Court the same ex officio power of the Attorney-General for all offences other than capital offences159. The ability of the Attorney-General to bring and control a proceeding, including those that would have been brought by grand jury in 154 New South Wales Act 1823 (Imp) (4 Geo IV c 96), s 4. See also R v McKaye (1885) 6 LR (NSW) L 123 at 127. 155 Bennett, "The Establishment of Jury Trial in New South Wales" (1961) 3 Sydney Law Review 463 at 482. 156 [1824] NSWSupC 2 (emphasis in original). 157 R v McKaye (1885) 6 LR (NSW) L 123 at 127. 158 9 Geo IV c 83. 159 Australian Courts Act 1828 (Imp) (9 Geo IV c 83), s 6; R v McKaye (1885) 6 LR (NSW) L 123 at 127. Edelman England160, and those that would be brought by relator action with the leave of the court, remained161. The process by which the relator action was then, and is still, brought is aptly described by Professors Aronson and Groves and Associate Professor Weeks162: "If there is time, this is done by instructing a solicitor and counsel, who prepare the originating process and accompanying pleadings or affidavit. Counsel certifies that the case is proper for the allowance of the Attorney- General's fiat, and the solicitor certifies the client's capacity to meet any adverse costs order." It has been held that the Attorney-General has an unreviewable discretion whether or not to permit the institution of proceedings163 and is not required to disclose their reasons for refusing to authorise the bringing of proceedings in their name: "[c]ourts of justice cannot compel anyone to invoke their aid who does not choose to do so; nor can they demand of him an explanation for his abstention"164. For "practical purposes"165, once the Attorney-General grants consent to the proceedings, the proceedings will usually be conducted by the relator. However, the relator acts throughout the proceedings on behalf of the Attorney- General. Although the Attorney-General "generally permits the relator to select a solicitor to conduct the case ... such person is not the solicitor of the relator, but of the Attorney-General"166. The Attorney-General may "interfere at any 160 R v Walton (1851) 1 Legge 706 at 707. 161 Australian Courts Act 1828 (Imp) (9 Geo IV c 83), ss 5, 6; Barton v The Queen (1980) 147 CLR 75 at 92-93. 162 Aronson, Groves and Weeks, Judicial Review of Administrative Action and Government Liability, 6th ed (2017) at 1001 [16.140]. 163 Barton v The Queen (1980) 147 CLR 75 at 94-95, 103-104, 110-111. See also London County Council v Attorney-General [1902] AC 165 at 168; Edwards, The Law Officers of the Crown (1964) at 288-289. 164 Gouriet v Union of Post Office Workers [1978] AC 435 at 496. 165 Hoffmann-La Roche & Co AG v Secretary of State for Trade and Industry [1975] AC 295 at 363. 166 Attorney-General for Ireland (Humphreys) v Governors of Erasmus Smith's Schools [1910] 1 IR 325 at 331. Edelman moment, and see that the cause is conducted by someone he has confidence in"167. The Attorney-General can "regulate the mode" by which the case is conducted168. The Attorney-General has complete charge of the litigation at all times169. The relator cannot appear separately and cannot take an opposing position to the Attorney-General170. It is, therefore, a "basic misconception" to treat the use of the Attorney-General's name as "fictional" with the "real claimant" as the relator171: "[The Attorney-General's] position in relator actions is the same as it is in actions brought without a relator (with the sole exception that the relator is liable for costs ...). He is entitled to see and approve the statement of claim and any amendment in the pleadings, he is entitled to be consulted on discovery, the suit cannot be compromised without his approval; if the relator dies, the suit does not abate." The same position applies where the relator proceedings concern the criminal law. Amendments to the criminal information cannot be made without the sanction of the Attorney-General172. The Attorney-General can discontinue the proceedings by entry of a nolle prosequi173. In Attorney-General v The Ironmongers' Company174, Lord Langdale MR said that: "he did not recognise the relator as distinct from the Attorney-General; that the suit was the suit of the Attorney-General, though at the relation of 167 Attorney-General v Haberdashers' Company (1852) 15 Beav 397 at 402 [51 ER 168 Attorney-General v Governors of the Sherborne Grammar School (1854) 18 Beav 256 at 264 [52 ER 101 at 104]. 169 Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 at 473-474 [287] and the authorities cited; [2002] HCA 16. 170 Attorney-General v The Ironmongers' Company (1840) 2 Beav 313 at 328 [48 ER 1201 at 1207]. See also Halsbury's Laws of England, 5th ed (2015), vol 8 at 520 171 Gouriet v Union of Post Office Workers [1978] AC 435 at 477-478; see also at 521. 172 Attorney-General v Fellows (1820) 1 Jac & W 254 [37 ER 372]. 173 R v Dunn (1843) 1 Car & K 730 at 731 [174 ER 1009 at 1010]; R v Chairman, County of London Quarter Sessions; Ex parte Downes [1954] 1 QB 1 at 6. 174 (1840) 2 Beav 313 at 328-329 [48 ER 1201 at 1207]. Edelman another person upon whom he relied and who was answerable for costs; and that he could only recognise the counsel for the relator as the counsel for the Attorney-General, and could hear them only by his permission; that the suit was so entirely under the control of the Attorney-General that he might desire the Court to dismiss the information, and that if he stated that he did not sanction any proceeding, it would be instantly stopped." Thus, there is "no difference between an information filed ex officio by the Attorney General and a proceeding by him at the relation of a third party, except as to costs"175. "In both cases the Sovereign, as parens patriae, sues by the Attorney General."176 In both cases the Attorney-General has "the legal right to control the conduct of the proceedings" and has the responsibility for the proceedings177. The relator action is "the Attorney-General's action"178 and it is "as competent or incompetent as if it were brought ex officio by him"179. In summary, a proceeding by the Attorney-General at the relation of a third party is brought in the name of the Attorney-General because it is by the Attorney-General and on their behalf. As Griffith CJ said in relation to a prosecution "in the name of" the Collector of Customs, the power can be exercised "for and on behalf of the Collector"180. 175 Attorney General v Logan [1891] 2 QB 100 at 103. See also Gouriet v Union of Post Office Workers [1978] AC 435 at 478. 176 Attorney-General v Cockermouth Local Board (1874) LR 18 Eq 172 at 176. See also Attorney General v Logan [1891] 2 QB 100 at 106. 177 Attorney-General (Q); Ex rel Duncan v Andrews (1979) 145 CLR 573 at 582; [1979] HCA 24; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 at 473-474 [287]. 178 Attorney-General v Wimbledon House Estate Co Ltd [1904] 2 Ch 34 at 39; Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 275; [1945] HCA 30. 179 Attorney-General (Vict) v The Commonwealth (1935) 52 CLR 533 at 560; [1935] HCA 31; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 at 402 [53]. 180 Christie v Permewan, Wright & Co Ltd (1904) 1 CLR 693 at 700; [1904] HCA 35. Edelman Section 13 of the Crimes Act 1914 (Cth) and s 69 of the Judiciary Act 1903 (Cth) At the start of the twentieth century, the general operation of relator proceedings for Commonwealth offences was altered by the creation of a new regime for prosecution of Commonwealth offences, bifurcated between (i) offences prosecuted summarily, akin to those prosecuted historically on a criminal information, and (ii) offences prosecuted on indictment181. The key elements of the new regime were s 13 of the Crimes Act 1914 (Cth) and ss 68 and 69 of the Judiciary Act 1903 (Cth). Subject to contrary intention in the relevant legislation or regulation182, s 13 of the Crimes Act deals with offences which may be tried summarily, historically those commenced by criminal informations. It also deals with the committal process for offences to be prosecuted on indictment. Section 69 of the Judiciary Act deals with offences to be tried after indictment, the issue of which in England would have been the consequence of a decision by a jury, usually a grand jury, but which in New South Wales would generally be initiated by the Attorney-General183. As to offences that may be tried summarily, the effect of s 13 is to permit those public rights to be brought and prosecuted in the name of a private individual. Leave of the court is no longer required by the general regime. Section 13 thus recognises the practical reality that had emerged from the manner in which a public right had been prosecuted historically on a criminal information in the name of a public officer: "[e]very person has an interest, and is allowed to put the law in motion in criminal matters"184. That reality was that the Master of the Crown Office and, in New South Wales, the Attorney-General had exercised no real constraint over the commencement of relator proceedings Section 13 operated "to clarify by a degree of filed in their name. simplification"185. As to offences which are to be tried on indictment, s 69 of the Judiciary Act maintained, and maintains, the requirement that those offences be prosecuted by indictment in the name of the Attorney-General of the 181 See, generally, R v Judd (1919) 26 CLR 168 at 172; [1919] HCA 9. 182 Crimes Act 1914 (Cth), s 13. 183 R v Walton (1851) 1 Legge 706 at 707; Barton v The Queen (1980) 147 CLR 75 184 Brebner v Bruce (1950) 82 CLR 161 at 169-170; [1950] HCA 36, quoting Grant v Thompson (1895) 72 LT 264 at 265. 185 Brebner v Bruce (1950) 82 CLR 161 at 175. Edelman Commonwealth or of such other person as the Governor-General appoints in that behalf186. By subsequent amendment187, s 69(2A) was introduced. That provision confirms that s 69 did not affect the power of the Commonwealth Director of Public Prosecutions or a Special Prosecutor to prosecute by indictment, respectively in their official name or own name. That regime is facilitated by s 68 of the Judiciary Act. One effect of s 68 is that so far as State or Territory courts have federal jurisdiction to prosecute Commonwealth offences, the procedural laws of the State or Territory would generally apply to both summary and indictable proceedings, including the committal proceedings for indictment that would historically have proceeded by a grand jury or by the Attorney-General in New South Wales. It was not suggested, nor could it have been suggested, by any counsel in this special case that s 69 of the Judiciary Act abolished the relator action. Plainly, it did not do so. Nor did State legislative provisions that require indictments to be brought "on behalf of the Crown, in the name of the Attorney General or the Director of Public Prosecutions"188 abolish the possibility of relator proceedings. All were enacted to include the possibility of relator proceedings brought for and on behalf of the Attorney-General. The continued existence of relator proceedings was assumed by Isaacs J in R v Judd189, when he considered the operation of a similar bifurcated regime in s 6(3A) of the War Precautions Act 1914 (Cth). That sub-section, inserted by an amendment in 1915190, imposed upon summary offences the consent constraint which had been required for offences involving governmental interests in England. The sub-section required written consent of the Attorney-General or Minister for Defence for the summary prosecution of an offence against the War Precautions Act. The amendment to the War Precautions Act also imposed a similar requirement to that in s 69 of the Judiciary Act, namely prosecution in the name of the Attorney-General, although without the possibility of the use of the name of a person authorised by the Governor-General. 186 Bainbridge-Hawker v The Minister of State for Trade and Customs (1958) 99 CLR 521 at 558; [1958] HCA 60. 187 Director of Public Prosecutions (Consequential Amendments) Act 1983 (Cth), s 21. 188 Criminal Procedure Act 1986 (NSW), s 8(1). See also Criminal Procedure Act 1921 (SA), s 103(1); Criminal Procedure Act 2004 (WA), Sch 1 cl 3(3). 189 (1919) 26 CLR 168. 190 War Precautions Act (No 2) 1915 (Cth), s 3. Edelman In R v Judd, Isaacs J explained that the constraints of (i) the consent of the Attorney-General and (ii) the use of the name of the Attorney-General provided "a safeguard to the individual" in that it "left the whole thing really in the hands of the Executive Government"191. In the instance of offences prosecuted summarily, the requirement of consent gave the Executive Government a veto power upon the commencement of proceedings. In the instance of offences prosecuted on indictment, the requirement that the proceedings be brought in the name of the Attorney-General gave the Executive Government, through the Attorney-General, the complete control of a party over any relator proceedings. With this background, the essence of the preliminary issue in this case is whether the special international context of s 268.121 of the Criminal Code requires a different meaning to be given to the words "prosecuted in the name of the Attorney-General". In my view, it does not. The text and purpose of s 268.121 of the Criminal Code The purpose of Div 268 of the Criminal Code is to "create certain offences that are of international concern and certain related offences"192 by creating a complementary jurisdiction of Australia to the jurisdiction of the International Criminal Court193. The indictable offences in Div 268 divide into two groups. On the one hand, there are those offences that can be prosecuted summarily as well as on indictment194, such as offences of compelling service in hostile forces (s 268.30), denying a person a fair and regular trial (s 268.31), and sentencing or execution without due process (s 268.76). On the other hand, there are those that must be prosecuted on indictment, such as genocide (ss 268.3, 268.4, 268.5, 268.6, 268.7), enslavement (s 268.10), and torture (s 268.25). Section 268.121 provides: "268.121 Bringing proceedings under this Division Proceedings for an offence under this Division must not be commenced without the Attorney-General's written consent. 191 R v Judd (1919) 26 CLR 168 at 172; see also at 173. 192 Criminal Code (Cth), s 268.1(1). 193 Criminal Code (Cth), s 268.1(2). 194 See Crimes Act 1914 (Cth), s 4J. Edelman (2) An offence against this Division may only be prosecuted in the name of the Attorney-General. (3) However, a person may be arrested, charged, remanded in custody, or released on bail, in connection with an offence under this Division before the necessary consent has been given." The meaning of ss 268.121(1) and 268.121(3) of the Criminal Code The most immediate and important matter of context in which sub-ss (1) and (3) must be interpreted is that they closely followed the pattern of the earlier overseas legislation which was also designed to give effect to obligations upon those States as parties or potential parties to the Rome Statute. The United Kingdom legislation, the International Criminal Court Act 2001 (UK), contains a provision, like s 268.121(1), requiring that the relevant "[p]roceedings for an offence shall not be instituted except by or with the consent of the Attorney General"195. A generally applicable provision, similar to s 268.121(3), also exists in United Kingdom legislation with the effect that such an exception did not need to be included in the International Criminal Court Act. The reason for this should be explained in more detail. From 1889, the consent of the Attorney-General was required for a prosecution to be commenced for offences under the Official Secrets Act 1889 (UK). In 1911, the Official Secrets Act 1911 (UK) added a proviso to the consent provision196, which was otherwise in identical terms to the 1889 Act, that the consent of the Attorney-General was not required before the arrest, or remand in custody or on bail, of a person charged with an offence under that Act. However, no further proceedings could be taken until the consent of the Attorney-General had been obtained. In the second reading speech to the Official Secrets Bill 1911, in the House of Lords, Viscount Haldane explained that197: "There is a provision in the Official Secrets Act of 1889 which we keep – the provision that you cannot prosecute without the assent of the Attorney- General. That provision was construed to mean that you could not arrest without the fiat of the Attorney-General. The result was that many of these persons with whom we wished to interfere were a long way off before any warrant could be obtained for their arrest. Therefore there is a 195 International Criminal Court Act 2001 (UK), s 53(3). 196 Official Secrets Act 1911 (UK), s 8. 197 United Kingdom, Parliamentary Debates, House of Lords, 25 July 1911, vol 9, col 643-644. Edelman provision in this Bill analogous to that which exists in the present law in the case of all felonies." That exception was adapted and applied to offences generally in s 25(2) of the Prosecution of Offences Act 1985 (UK), which provides, in effect, for the same exemption from any enactment that prohibits the institution or carrying on of proceedings for any offence except with consent, including that of the Attorney- General. In R v Lambert198, the Court of Appeal of England and Wales held that s 25 "covers action that needs to be taken to apprehend the offender and detain him if there is not time to obtain permission. It does not in our judgment permit anything more to be done." Section 25 of the Prosecution of Offences Act also applies to offences under the International Criminal Court Act. The New Zealand legislation, the International Crimes and International Criminal Court Act 2000 (NZ), took the same approach. That legislation provides that the relevant proceedings may not be instituted "without the consent of the Attorney-General"199 and contains an exception to the consent provision in very similar terms to s 268.121(3) and for the same purpose200. The restriction in s 268.121(1) and the exception in s 268.121(3) of the Criminal Code closely followed the United Kingdom and New Zealand approaches, for the same purpose. As the Explanatory Memorandum to the International Criminal Court (Consequential Amendments) Bill 2002 said of "Proposed subsection (3) provides that a person may be arrested, charged and remanded in custody or released on bail for an offence under this Division before the consent has been given. This is to ensure that any delay in obtaining written consent from the Attorney-General will not delay the arrest of a person or allow a person to escape, and that it also will not result in a person being unduly held on remand." 198 [2010] 1 WLR 898 at 909 [21]. 199 International Crimes and International Criminal Court Act 2000 (NZ), s 13(1). 200 International Crimes and International Criminal Court Act 2000 (NZ), s 13(2). See New Zealand, Foreign Affairs, Defence and Trade Committee, International Crimes and International Criminal Court Bill, Commentary (2000) at 7. 201 Australia, House of Representatives, International Criminal Court (Consequential Amendments) Bill 2002, Explanatory Memorandum at 16. Edelman Application of the meaning of ss 268.121(1) and 268.121(3) of the Criminal Code In each of the United Kingdom202 and New Zealand203, courts and commentators have assumed that a relator proceeding can be brought with the consent of the Attorney-General. However, by initially lodging the charge-sheet and draft summons in his own name with the Magistrates' Court at Melbourne, Mr Taylor sought to bring the charge by relying upon the exception in It is unnecessary to consider whether the charge-sheet should have been accepted for filing by the Registrar at the Magistrates' Court within the exception in s 268.121(3). If the charge had been brought by a police officer it would have fallen precisely within the text and purpose of s 268.121(3). As a private person seeking to bring a charge, it may be that Mr Taylor was in no different a position from a police officer who "is acting not by virtue of his office but as a private citizen interested in the maintenance of law and order"204. But it is not necessary to consider this issue further because the preliminary issue is whether s 268.121(2) precludes the prosecution as a relator proceeding in the name of the Attorney-General. The text and purpose of s 268.121(2) of the Criminal Code By itself, the text of s 268.121(2) does not suggest the exclusion of a relator proceeding. To the contrary, its terms come as close as possible to expressly including relator proceedings without the use of the word "relator". As I have explained, an offence that is prosecuted by way of a relator proceeding is an offence "prosecuted in the name of the Attorney-General". It falls precisely within the words of s 268.121(2). Neither the United Kingdom nor the New Zealand legislation contains a sub-section equivalent to s 268.121(2). The absence of such a provision in that legislation may simply be based upon an assumption that relator proceedings are possible. Or it may be a consequence of particular legislation or more recent developments concerning relator proceedings in those jurisdictions. However, in 202 R (Islamic Human Rights Commission) v Civil Aviation Authority [2006] EWHC 2465 at [38]; Warbrick, "Immunity and International Crimes in English Law" (2004) 53 International and Comparative Law Quarterly 769 at 771-774. 203 Dunworth, "From Rhetoric to Reality: Prosecuting War Criminals New Zealand" (2008) 5 New Zealand Yearbook of International Law 163. 204 Devlin, The Criminal Prosecution in England (1960) at 17. See also Lund v Thompson [1959] 1 QB 283 at 285. Edelman the effect of s 13 of the absence of s 268.121(2), Australia, the Crimes Act would be that unless a contrary implication of legislative intention could be found elsewhere in Div 268, some offences in that Division could be prosecuted summarily, with the consent of the Attorney-General, but without the complete control of the Attorney-General that would ordinarily be associated with a relator proceeding. The evident purpose of s 268.121(2) is to impose upon any prosecution for an offence against Div 268 the control of the proceedings by the Attorney-General in addition to the Attorney-General's written consent for their commencement. The requirement that an offence be prosecuted "in the name of the Attorney-General" does not exclude agents of the Attorney-General. Indeed, it was common ground in oral submissions that the Attorney-General could delegate a prosecution to the Commonwealth Director of Public Prosecutions as their agent. The Director is empowered to prosecute in their own name or "in any other manner"205. An exclusion of relator proceedings would therefore require s 268.121(2) to be read as though it required prosecution "in the name of the Attorney-General and by the Attorney-General or their agent other than where the prosecutor acting as relator to the Attorney-General is not a professional prosecutor". This is a large implication which is substantially at variance with the words used206. The strongest argument in its favour is the existence of the legislative provision in Canada which preceded the introduction of Div 268, which was also a response to the Rome Statute, and which might arguably be interpreted to exclude relator proceedings. Section 9(3) of the Crimes Against Humanity and War Crimes Act 2000 (Can) provided: "No proceedings for an offence under any of sections 4 to 7, 27 and 28 [including genocide, a crime against humanity or a war crime] may be commenced without the personal consent in writing of the Attorney General or Deputy Attorney General of Canada, and those proceedings may be conducted only by the Attorney General of Canada or counsel acting on their behalf." 205 Director of Public Prosecutions Act 1983 (Cth), s 9(1); R v Gee (2003) 212 CLR 230 at 247 [34]; [2003] HCA 12. 206 Taylor v Owners – Strata Plan No 11564 (2014) 253 CLR 531 at 548 [38]; [2014] HCA 9. Edelman Professor Lafontaine has argued that this provision excluded private prosecutions and that it existed "to allow for considerations of foreign policy to be assessed at the political level"207. As I explain below, there is, however, ambiguity about the expression "private prosecutions". But whether or not the Canadian provision excludes relator proceedings might depend upon whether Canadian law recognises the complete control that the Attorney-General has historically had over a relator proceeding and whether that control is sufficiently within s 9(3) of the Crimes Against Humanity and War Crimes Act for the relator to be considered to be acting on behalf of the Attorney-General of Canada. Those issues need not be considered in this case. The Commonwealth Parliament, with the benefit of consideration of s 9(3), chose to adopt the different and long-standing form of words that reflects the existence of relator proceedings. The submission that the purpose of s 268.121(2) of the Criminal Code was to exclude private prosecutions The submission that s 268.121(2) excludes private prosecutions relied upon s 12 of the War Crimes Act 1945 (Cth). That section was inserted by the War Crimes Amendment Act 1988 (Cth), requiring that offences against the War Crimes Act be prosecuted only in the name of the Attorney-General or the Director of Public Prosecutions. The Explanatory Memorandum to the War Crimes Amendment Bill provided that "[t]he nature of the offences" meant that it was "desirable to exclude the possibility of private prosecutions"208. The expression "private prosecution" is both misleading and ambiguous. It is misleading because, as Maitland observed, such prosecutions are "public" since it commonly means that "any one of the public may prosecute"209. It is ambiguous because it is an expression that is used in different ways. Sometimes it is used to mean a prosecution by a private individual who is not a public prosecutor, a police officer or an agent of the police210. On other occasions it is used to include prosecutions by police officers, albeit that they are not acting by virtue of their office, "but as a private citizen interested in the maintenance of law 207 Lafontaine, "The Unbearable Lightness of International Obligations: When and How to Exercise Jurisdiction under Canada's Crimes against Humanity and War Crimes Act" (2010) 23 Revue Québécoise de droit international 1 at 27. 208 Australia, House of Representatives, War Crimes Amendment Bill 1987, Explanatory Memorandum at 8. 209 Maitland, Justice and Police (1885) at 141 fn 1. 210 Hay, "Controlling the English Prosecutor" (1983) 21 Osgoode Hall Law Journal Edelman and order"211. On still further occasions it is used to describe those proceedings in which the private person conducts the prosecution in their own name rather than, as a relator proceeding, in the name of and subject to the control of the Attorney-General. As the Australian Law Reform Commission observed, there is "no clear-cut definition of a private prosecution"212. A private prosecution in the last sense describes a summary charge brought by a private citizen in their own name, which, unlike a relator proceeding, can only be withdrawn by the Attorney-General or the Director of Public Prosecutions if the charge is taken over and then there is an application for leave to withdraw or discontinue213. In a 1990 working paper the Law Reform Commission of Canada seemed to treat private prosecutions as having the meaning of a summary charge brought by a private citizen, and as excluding relator actions, when it contrasted the power of the Attorney-General to "supervise" private prosecutors (who have powers "to lay a charge and to proceed with a prosecution") with the power of the Attorney-General to determine "what actions ought to be brought in the name of the state"214. It is unclear what should be taken to have been meant by "private prosecutions" in the draftsperson's discussion in the Explanatory Memorandum to the War Crimes Amendment Bill. Without more, an ambiguous statement in an Explanatory Memorandum will rarely be of assistance in statutory interpretation215. If an ambiguous statement were decisive then the selection of a preferred meaning would invite a teleological approach to interpretation of the statute. It suffices here to say that if "private prosecutions" means those 211 Devlin, The Criminal Prosecution in England (1960) at 16-17. See also Lund v Thompson [1959] 1 QB 283 at 285. 212 Australian Law Reform Commission, Standing in Public Interest Litigation, Report No 27 (1985) at 184 [346]. 213 R v Dainer; Ex parte Pullen (1988) 78 ACTR 25 at 30-31; Price v Ferris (1994) 34 NSWLR 704 at 708; Miller v Director of Public Prosecutions (Cth) (2005) 142 FCR 394 at 399 [23]-[24]. See also Gouriet v Union of Post Office Workers [1978] AC 435 at 487, 520-521; R (Gujra) v Crown Prosecution Service [2013] 1 AC 484 at 492 [15]; MacDermott, Protection from Power under English Law 214 Law Reform Commission of Canada, Controlling Criminal Prosecutions: The Attorney General and the Crown Prosecutor, Working Paper 62 (1990) at 19, 215 Taylor v Owners – Strata Plan No 11564 (2014) 253 CLR 531 at 556-557 [65]; see also, for example, at 554 [55]. Edelman prosecutions that are brought and conducted in the name of the private party then the statement is entirely accurate. Even if the ambiguous reference to "private prosecutions" in the Explanatory Memorandum to the War Crimes Amendment Bill were to be understood to include relator proceedings instituted in the name of the Attorney- General the reference could not be decisive of the meaning of s 12 of the War Crimes Act. It would be contrary to the plain semantic meaning of the words of s 12 of that Act. It would be contrary to the history of the relator action and the association between that history and the expression "in the name of the Attorney-General". It would be contrary to the assumptions underlying decisions such as that of Isaacs J in R v Judd216. And, perhaps most significantly, it would not be consistent with the immediate context of s 268.121 of the Criminal Code, whose provisions deal with the same issues as the legislation of the United Kingdom, New Zealand, and Canada but which do not adopt the Canadian wording. Conclusion I would have allowed this special case to progress to further hearing past the preliminary issue. A relator prosecution brought in the name of the Attorney- General, and controlled by the Attorney-General, is a prosecution "in the name of the Attorney-General". The particular international context in which Div 268 was enacted is consistent with this conclusion. 216 (1919) 26 CLR 168.
HIGH COURT OF AUSTRALIA STATE OF QUEENSLAND APPELLANT AND RESPONDENTS [2015] HCA 17 13 May 2015 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation S E Brown QC with G J D del Villar for the appellant (instructed by Crown Law Brisbane) S A Glacken QC with P D Herzfeld for the first respondents (instructed by North Queensland Land Council) J T Gleeson SC, Solicitor-General of the Commonwealth and S B Lloyd SC with C J Klease for the second respondent (instructed by Australian Government Solicitor) No appearance for the third respondent Submitting appearance for the fourth to twenty-first respondents No appearance for the twenty-second and twenty-third respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Native title – Native title rights in relation to land – National Security Act 1939 (Cth), s 5(1)(b)(i) provided for making of regulations for securing public safety and defence of Commonwealth and for authorising taking of possession or control, on behalf of Commonwealth, of any property – National Security (General) Regulations 1939 (Cth), reg 54(1) provided that if it appeared to Minister of State for Army to be necessary or expedient to do so in interests of public safety, defence of Commonwealth or efficient prosecution of war, or for maintaining supplies and services essential to life of Commonwealth, Minister could, on behalf of Commonwealth, take possession of any land and give such directions as appeared necessary or expedient in connection with taking possession – Where orders were made under reg 54(1) in relation to land authorising officer to do anything in relation to land that holder of estate in fee simple in land could do and prohibiting all other persons from exercising any right of way over land or any other right relating thereto – Whether orders inconsistent with claimed native title rights and interests – Whether clear and plain legislative intention to extinguish native title rights and interests. Words and phrases – "clear and plain legislative intention", "exclusive possession", "extinguishment", "inconsistency of rights", "possession". National Security Act 1939 (Cth), s 5(1). National Security (General) Regulations 1939 (Cth), reg 54. FRENCH CJ AND KEANE J. Introduction In September 2001, the Bar-Barrum People lodged an application in the Federal Court for a determination of native title over an area of land in the Atherton Tableland in the State of Queensland, part of which had been used by the Commonwealth during World War II as an artillery range and a live fire manoeuvre range for the training of infantry and armoured units. The Commonwealth took possession of the land and used it pursuant to a series of orders, made between 1943 and 1945, under reg 54 of the National Security (General) Regulations ("the National Security Regulations"). That regulation was made pursuant to s 5 of the National Security Act 1939 (Cth) ("the NSA"). The Commonwealth relinquished possession of the land in August 1945. Questions arose in the Federal Court proceedings about whether the orders had the effect of extinguishing the native title rights and interests of the Bar-Barrum People. In August 2013, Logan J referred a Special Case to the Full Court of the Federal Court setting out questions about the effect of the military orders on the native title rights and interests of the Bar-Barrum People. The question in the Special Case relevant to this appeal was Question 3: "Did the act of the Commonwealth in: (a) making the Military Orders wholly extinguish all native title rights and interests that then subsisted on the special case land, and, if not, being in physical occupation of at least some of the special case land pursuant to the Military Orders wholly extinguish all native title rights and interests that then subsisted on the special case land or that part of the special case land that had been physically occupied?" The Full Court of the Federal Court by majority (North and Jagot JJ, Logan J dissenting) answered both limbs of Question 3 in the negative1. The State of Queensland appeals to this Court by special leave granted on 4 September 2014. For the reasons that follow the appeal should be dismissed. 1 Congoo v Queensland (2014) 218 FCR 358. The National Security Act 1939 (Cth) The NSA was a draconian measure with a sunset clause. The Bill for the Act was described by Prime Minister Menzies in his Second Reading Speech as granting "wide powers to the Executive"2. The Prime Minister went on to say, however3: "That whatever may be the extent of the power that may be taken to govern, to direct, and to control by regulation, there must be as little interference with individual rights as is consistent with concerted national effort. That, I believe, is the principle that should guide any executive armed with powers of this kind." That qualification was indicative of a legislative purpose to affect existing rights as little as possible. That was a purpose which, in its application to property rights, was reflected in decisions of this Court construing the Act, reg 54 and orders made under that regulation4. It informs their construction in relation to this appeal. The NSA was to continue in operation "during the present state of war and for a period of six months thereafter"5. That period was amended in 1940 to end on "a date to be fixed by Proclamation, and no longer, but in any event not longer than six months after His Majesty ceases to be engaged in war"6. In 1946 the Act was further amended so that it and all regulations under it and all orders, rules and by-laws made in pursuance of any such regulations would cease to have effect at midnight on 31 December 19467. 2 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 September 1939 at 164. 3 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 September 1939 at 164. 4 Syme v The Commonwealth (1942) 66 CLR 413; [1942] HCA 29; Minister of State for the Army v Dalziel (1944) 68 CLR 261; [1944] HCA 4; Minister for Interior v Brisbane Amateur Turf Club (1949) 80 CLR 123; [1949] HCA 31, which are discussed later in these reasons. 5 NSA, s 19. 6 National Security Act 1940 (Cth), s 9. 7 National Security Act 1946 (Cth), s 2. Section 5(1) of the NSA originally empowered the Governor-General to the the public safety and defence of make regulations for securing Commonwealth and the Territories of the Commonwealth, and in particular: for authorizing— the taking of possession or control, on behalf of the Commonwealth, of any property or undertaking; or the acquisition, on behalf of the Commonwealth, of any property other than land in Australia". Paragraph (b)(ii) was amended in 19408. The term "property" in par (b) was not defined. It is a term which may be used in different senses according to its statutory context. Referring to land, it may mean the physical entity or rights and interests which exist in relation to it9. In par (b)(i) it applies to land as a physical entity. The words "possession" and "control" in par (b)(i) are close to synonymous in that context. That view is supported by the observation of Williams J in Minister of State for the Army v Dalziel in which he said of the difference between pars (b)(i) and (b)(ii) that10: "The Parliament ... in enacting the section, intended to distinguish between the taking of temporary possession or control of land and the acquisition of some permanent estate or interest in land". That distinction did not prevent the characterisation of "possession", taken pursuant to a regulation made under par (b)(i), as an "acquisition" of property for the purposes of s 51(xxxi) of the Constitution. Nevertheless, as construed by Williams J, par (b)(i) conferred a regulation-making power with respect to 8 National Security Act 1940 (Cth), s 5. Section 8 of that Act, which inserted s 13A into the NSA, also authorised regulations under which persons could be required "to place themselves ... and their property at the disposal of the Commonwealth". No regulation based on that section was in issue in these proceedings. 9 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 276 per Latham CJ. See generally Telstra Corporation Ltd v The Commonwealth (2008) 234 CLR 210 at 230–231 [44]; [2008] HCA 7; White v Director of Public Prosecutions (WA) (2011) 243 CLR 478 at 485 [10]–[12] per French CJ, Crennan and Bell JJ; [2011] HCA 20. 10 (1944) 68 CLR 261 at 306. property limited to its temporary control. It is the exercise of that power which is in issue in this case. Under s 5(3) of the NSA, the regulations could empower persons, or prescribed classes of persons, to make orders for any of the purposes for which regulations were authorised to be made by the Act. Section 10 of the Act made it an offence for a person to contravene, or fail to comply with, any provision of a regulation made under the Act or any order made pursuant to such a regulation. Queensland submitted that the NSA authorised the making of regulations under which a "right of exclusive possession" could be conferred upon the Commonwealth by military orders made pursuant to the regulations. That "right of exclusive possession" was said to have been conferred in this case and to have extinguished the native title rights and interests of the Bar-Barrum People in the land affected by the orders. The submission directs attention to the difficult concept of "possession" as used in the Act and the important distinction between "exclusive possession", which is a logical incident of actual, factual or physical possession11, and a "right of exclusive possession". A "right of exclusive possession"12 in relation to fee simple grants and leases, as discussed by this Court in Fejo v Northern Territory13 and Western Australia v Brown14, involves the right to exclude anyone and everyone from the land for any reason or no reason at all. However, as appears below, the statutory powers conferred upon the Commonwealth as an incident of the grant of "possession" under the military orders were not unqualified merely because that word was used. Broad as they were, they were to be exercised in accordance with the scope, subject matter and purpose of the NSA and the regulations made under it. The scope and limits of those powers may be discerned by reference to the text of reg 54. The National Security Regulations — Regulation 54 Regulation 54 of the National Security Regulations, as it stood in November 1943, provided, inter alia: 11 Gray and Gray, Elements of Land Law, 5th ed (2009), par 2.1.10. 12 See generally Hill, "The Proprietary Character of Possession", in Cooke (ed), Modern Studies in Property Law, Volume 1: Property 2000, (2001) 21 at 26–30. 13 (1998) 195 CLR 96 at 128 [47]; [1998] HCA 58. 14 (2014) 88 ALJR 461 at 468 [36]; 306 ALR 168 at 175‒176; [2014] HCA 8. If it appears to the Minister of State for the Army to be necessary or expedient so to do in the interests of the public safety, the defence of the Commonwealth or the efficient prosecution of the war or for maintaining supplies and services essential to the life of the community, he may, on behalf of the Commonwealth, take possession of any land, and may give such directions as appear to him to be necessary or expedient in connexion with the taking of possession of the land. (2) While any land is in the possession of the Commonwealth in pursuance of a direction given under this regulation, the land may, notwithstanding any restriction imposed on the use thereof (whether by law or otherwise), be used by, or under the authority of, that Minister for such purpose, and in such manner, as he thinks expedient in the interests of the public safety or the defence of the Commonwealth, or for maintaining supplies and services essential to the life of the community; and that Minister, so far as appears to him to be necessary or expedient in connexion with the taking of possession or use of the land in pursuance of this sub-regulation— (a) may do, or authorize persons so using the land to do, in relation to the land, anything which any person having an unencumbered interest in fee simple in the land would be entitled to do by virtue of that interest; and (b) may by order provide for prohibiting or restricting the exercise of rights of way over the land, and of other rights relating thereto which are enjoyed by any person, whether by virtue of an interest in land or otherwise. The owner or occupier of any land shall, if requested by the Minister of State for the Army or a person thereto authorized by him so to do, furnish to that Minister or such person as is specified in the request such information in his possession relating to the land (being information which reasonably may be demanded in connexion with the execution of this regulation) as is so specified." Regulation 54(1) empowered the Minister to "take possession of any land". The word "possession" is one for which English law has never worked out a completely logical and exhaustive definition15. The question in this case is: what was the nature of the possession which reg 54(1) authorised? There are two 15 Tabe v The Queen (2005) 225 CLR 418 at 423 [7] per Gleeson CJ; [2005] HCA 59. relevant possibilities. The first is that it authorised a taking of actual or physical possession, which, as noted above, brings with it a notion of exclusivity albeit it must be understood in its statutory setting16. The second possibility is that it conferred a "right of exclusive possession", equivalent to the unqualified right of a fee simple owner to exclude anyone and everyone from the land for any reason whatsoever. The text and arrangement of the regulation, read as a whole, suggest that reg 54(1) was concerned with actual possession and did not authorise the conferral upon the Commonwealth of a "right of exclusive possession". Regulation 54(2) conferred statutory power to do the things that a fee simple owner could do and the power, by order, to restrict the exercise of the rights of persons relating to the land, whether by virtue of an interest in the land or otherwise. If reg 54(1) authorised an order conferring a "right of exclusive possession" in the sense used above, the powers in reg 54(2) would be otiose. That suggests that reg 54(1) did not go that far17. Moreover, reg 54(2) conferred statutory powers not property rights, albeit it did so in par (a) using the legal fiction of a fee simple grant. Those powers had to be exercised for the purposes of the regulation, which had to accord with those of the NSA. The limiting negative purpose of the NSA apparent from the Second Reading Speech is antithetical to a general discretion to exercise those powers against anyone and everyone for any reason whatsoever. If the preceding construction be correct, there is no necessary legal antinomy between the grant of the rights authorised and the powers conferred by reg 54 on the one hand, and the subsistence of pre-existing rights and interests including native title rights and interests on the other. That conclusion is reinforced by reg 54(3), which assumes a continuing relationship between the land and "the owner or occupier" of it. As appears below, the compensation provisions rest upon a similar premise. When reg 54 was originally promulgated it included reg 54(4) in the following terms: "Such compensation shall be payable for any damage or loss sustained by the owner or occupier of the land by reason of the taking of possession of the land, or of anything done in relation to the land in pursuance of this regulation, as is determined by agreement, or in the absence of agreement, 16 J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419 at 436 [41] per Lord Browne- Wilkinson, 445‒446 [70] per Lord Hope of Craighead. 17 Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 7; [1932] HCA 9. by action by the claimant against the Minister in any court of competent jurisdiction." The compensation was not payable by way of "quid pro quo" for the taking by the Commonwealth but for loss or damage sustained by the owner by reason of the taking under reg 54(1) and the exercise of powers under reg 54(2). The loss or damage in contemplation was concerned with the loss or damage to existing rights by the exercise of the overriding right. A new compensation regime was created under the National Security Regulations in 194118 for a person who had suffered, or was suffering, loss or damage by reason of anything done in pursuance of reg 54 in relation to19: "any property in which he has, or has had, any legal interest, or in respect of which he has, or has had, any legal right". Absent any method of fixing compensation under regulations other than the National Security Regulations, the compensation to be paid would be determined by agreement, or by the Minister or a compensation board on referral by the Minister pursuant to a request by the claimant20. Where the claim was in respect of a continuing interference with rights, the claimant could seek compensation by way of a periodical payment during the continuance of the interference. The claimant could also, within two months after the cessation of the interference, submit a further claim in respect of any loss or damage suffered by reason of anything done during the period of the interference (except damage resulting from war operations) which had not been made good and was not covered by the periodical payment21. The scheme appears to have assumed, as with the former reg 54(4), the continuation of the underlying rights of the owner or occupier, the enjoyment of which was impaired or prevented for the period of the Commonwealth's occupation of the land. 18 National Security (General) Regulations (Amendment) (SR No 291 of 1941), cl 3, inserting National Security Regulations, regs 60B–60M. Those regulations were further amended by the National Security (General) Regulations (Amendment) (SR No 402 of 1942). 19 National Security Regulations, reg 60D(1)(a). 20 National Security Regulations, regs 60D(1), 60E(3)–(5), 60F(1). 21 National Security Regulations, reg 60D(1). The existence of that assumption is supported by observations in Syme v The Commonwealth22, in which the Court was concerned with a claim by a mortgagee, not in possession, for a proportion of the compensation paid by the Commonwealth to the mortgagor, who was in possession at the time of the taking pursuant to reg 54. The mortgagee argued that the periodical compensation was analogous to "rents and profits of the land", which, upon default in payment of principal or interest, the mortgagee was entitled to receive pursuant to s 151 of the Transfer of Land Act 1928 (Vic). In rejecting that proposition Latham CJ observed23: "Compensation under the Regulations is not paid in respect of the taking away of any part of the property or of any incident of the property. It is paid for the loss or damage suffered by the person to whom it is paid — in this case, the mortgagor." Williams J, who also rejected the proposition that the Commonwealth was in any sense a tenant of the land, said24: "Its title to possession does not depend upon any express or implied agreement made with any persons interested in the land, but is paramount to and overrides any other statutory or common law or equitable rights existing in any person with respect to possession. It is therefore a right, the exercise of which can cause loss and damage, not only to the person in possession of the land at the date of the entry, but to any persons who become entitled to such possession at any time during the intrusion. The loss or damage arising from time to time from the intrusion is of the same nature as the loss or damage caused from time to time by a continuing trespass." (citation omitted) The exercise of the powers conferred by reg 54 may be said to have overridden pre-existing rights, but that overriding operation, while potentially affecting their enjoyment and exercise, did not involve their extinguishment. The military orders Five successive orders were made over the native title land between 1943 and 1945, each order revoking or cancelling its predecessor. The form and content of each was substantially similar. Each commenced with a recital that it 22 (1942) 66 CLR 413. 23 (1942) 66 CLR 413 at 421. See also at 424 per Starke J. 24 (1942) 66 CLR 413 at 429. appeared to the person making the order "to be necessary and expedient in the interests of the public safety, the defence of the Commonwealth and the efficient prosecution of the war or for maintaining supplies and services essential to the life of the community, on behalf of the Commonwealth to take possession of the land described in the Schedule to this order" and to give the directions set out in the order in connection with taking possession of the land. There followed the substantive exercise of the power conferred by reg 54. The following text is taken from the order signed by Colonel Francis North on 20 December 1943: "[Now therefore] I, acting in pursuance of the said Regulation and Instrument of Delegation, [do hereby] on behalf of the Commonwealth, [take possession] of the said land [and do hereby order and direct] as follows: that I direct the Deputy Assistant Quartermaster General Number 17 Lines of Communication Sub Area or any person or persons authorised by him occupy the said land and in so doing and so far as is practicable use the existing means of access to the said land and if necessary cause to be removed therefrom all personal property not the property of the persons occupying the said land in pursuance of this order and not required for Commonwealth purposes. I authorise the person or persons specified in Paragraph 1 hereof to do in relation to the said land anything which any person having an unencumbered interest in the fee simple in the said land would be entitled to do by virtue of that interest. 3. While the said land remains in possession of the Commonwealth, no person shall exercise any right of way over the land or any other right relating thereto, whether by virtue of an interest in land or otherwise. Should the said land be the subject of any previous order such order is hereby cancelled so far as it affects the said land." A schedule to the order set out a description of the affected land. At about the time the first of the orders was made the Commonwealth physically occupied at least some of the land. It was used as an artillery range and as a live fire manoeuvre range for the training of infantry and armoured units who were preparing to deploy to the South West Pacific area. Occupation by the Commonwealth ceased on or about 31 August 1945. In Dalziel, the Court was concerned with the characterisation, for the purpose of s 51(xxxi) of the Constitution, of a military order under reg 54 whereby the Commonwealth took possession of vacant land in Sydney owned by the Bank of New South Wales and occupied by Mr Dalziel under a weekly tenancy. Queensland relied upon Dalziel for the proposition that the Commonwealth's possession pursuant to reg 54 and the military orders was "plainly exclusive of the rights of all others". To the extent that this proposition equates the authorisation of exclusive possession as an incident of actual, factual or physical possession with the right of exclusive possession, which is necessarily inconsistent with the continued existence of other rights in the same land, it cannot be accepted. In particular, that equation is not supported by the terms of reg 54 itself. As Williams J explained, notwithstanding its conferment of exclusive possession, the military order did not determine any estate or interest in the land. The owner continued to be the owner in fee simple and the tenant continued to be a tenant from week to week. Their rights continued to exist "subject to the statutory right of the Commonwealth to take possession of the land and to use it for the purpose authorized by the regulation"25. His Honour said26: therefore, the regulation, "Under the Commonwealth acquires by compulsion a right for an indefinite period to the possession and use of land previously vested in some person ... by virtue of some estate or interest in the land which that person owns at common law. That person has therefore been divested of the right to possess the land so long as the Commonwealth continues in possession." The right of possession was held by the majority to be a property right27, which informed the affirmative answer to the question whether there had been an acquisition of property within s 51(xxxi) of the Constitution. That answer was nevertheless consistent with the proposition that the military order conferred on the relevant Commonwealth officer control of the land which did not involve the determination of any pre-existing estate or interest in the land. Starke J, who dissented on the question whether the regulations provided for "just terms" but was part of the majority on the question of acquisition, said28: 25 (1944) 68 CLR 261 at 301, although, as Rich J observed at 286, the Minister had seized and taken away from Mr Dalziel everything that made his weekly tenancy worth having and left him with "the empty husk of tenancy". 26 (1944) 68 CLR 261 at 301. 27 (1944) 68 CLR 261 at 285 per Rich J, 290 per Starke J, 295 per McTiernan J, 299 28 (1944) 68 CLR 261 at 290. "Nothing is gained by comparing the right given by reg 54 to the Commonwealth with various estates or interests in land of limited duration or with rights over the land of another recognized by the law, for it is a right created by a statutory regulation and dependent upon that regulation for its operation and its effect." Latham CJ, who dissented on whether the possession conferred under the regulation could be an acquisition, nevertheless accurately described the operation of reg 54 and orders made under it when his Honour said29: "The rights of the Commonwealth are to take and remain in possession of the land and to use it for purposes of defence. In such use, but only for the purposes of such use, the Commonwealth has the rights of an owner in fee simple." (emphasis added) Consistently with what was said in Dalziel, the Commonwealth submitted in this appeal that the right which it had acquired over the land pursuant to the successive military orders was a right of possession for the purposes specified in reg 54, which was to have no effect on the continuing existence of any other rights or interests in the land but only temporarily on their exercise. That characterisation, which accords with a characterisation of the possession under reg 54 as "actual possession", also accords with the approach adopted by this Court in Minister for Interior v Brisbane Amateur Turf Club30, which concerned Commonwealth occupation of land pursuant to an order made under reg 54, and a claim for compensation by the lessee of the land, who, during the occupation, continued to pay the owner rent reserved under the lease. In rejecting a submission that the owner had no power to grant a lease during the period of occupation, Latham CJ rejected an argument, by analogy, based on concurrent leases and said31: "in the present case the Commonwealth comes in by paramount right for an indefinite period without and independently of any grant by the owner. In my opinion there is no principle of law which prevents the owner granting a lease which will be subject to the rights of the Commonwealth under the regulations." 29 (1944) 68 CLR 261 at 278. 30 (1949) 80 CLR 123. 31 (1949) 80 CLR 123 at 148. Dixon J held that the Commonwealth was in "actual possession" under a statutory right enabling it to occupy at its will and said32: "I see no reason why the right to possession should not be granted by a lease although the Commonwealth was in actual possession." McTiernan J agreed with both Latham CJ and Dixon J33. The actual possession or control conferred by the military orders considered in Dalziel and in Brisbane Amateur Turf Club did not extinguish pre- existing possessory rights. The character of the orders in those cases was inconsistent with the grant of a "right of exclusive possession". Paragraph 3 in each of the military orders does not alter that conclusion. It prohibited the exercise of rights of way over the land or any other right relating to the land. It did not provide for their extinction. Indeed, par 3, like reg 54(2)(b), expressly contemplated their continuing existence. The question that follows is whether the native title rights and interests of the Bar-Barrum People were extinguished by the military orders made in relation to that land under reg 54, in terms similar to those considered in Dalziel and Brisbane Amateur Turf Club. The question directs attention to the content of the native title of the Bar-Barrum People. The native title rights and interests It was agreed in the Special Case that, subject to the extinguishing effect of the military orders, the Bar-Barrum People would hold at least non-exclusive native title rights and interests over the Special Case land. Those rights would include rights of access, to be present and move about, travel over, camp and live temporarily on the land as part of camping, and for that purpose to build temporary shelters. Absent extinguishment they would also have a non-exclusive right to hunt, fish and gather on the land and waters of the area for personal, domestic and non-commercial communal purposes. They could take and use natural resources including water from the land and its waters for non- commercial communal purposes. They could conduct ceremonies on the land, be buried and bury native title holders there, maintain places of importance and areas of significance under their traditional laws and customs, protect those places and areas from physical harm, and teach on the land about its physical and spiritual attributes. They could hold meetings on the area and light fires on it for 32 (1949) 80 CLR 123 at 162. 33 (1949) 80 CLR 123 at 163. domestic purposes, including cooking, but not for the purposes of hunting or clearing vegetation. The people could use the land in a variety of ways. They could not possess it to the exclusion of others. The reasoning of the Full Court The majority in the Full Court held that, in making reg 54, the Commonwealth (evidently a reference to the Executive Government) intended that all rights and interests in the land should yield to its exclusive possession for the duration of its exercise of power under reg 54. Those rights should otherwise continue and could found an entitlement to compensation for interference with them34. Although the native title rights could not be exercised during the Commonwealth's exercise of power, they were not thereby suspended. The rights which the Commonwealth took to itself were not inconsistent with the continued existence of native title rights35. Its exclusive possession was for a limited purpose, for a limited time, and on the premise, apparent from the legislative scheme, that all underlying rights and interests should continue36. With respect, the way in which the Full Court approached the question of legislative purpose was erroneous. The criterion of extinguishment is and remains one of inconsistency. The purpose of the statute said to effect or authorise extinguishment plays a part in determining the construction of that statute and, flowing from that construction, the nature and content of the powers it confers and the rights which may be granted under it. Their Honours also accepted a submission by the Commonwealth that the creation of a document styled "military order" did not of itself amount to taking possession of the land which it affected37. Given that reg 54 applied throughout Australia, and potentially to all types of land, something more than the completion of a form by a delegate had to be done to take possession. What had to be done might vary depending on the land in question38. As appears below, it is not necessary to consider the correctness of that conclusion. Logan J, in dissent, correctly identified the relevant question as one of inconsistency. His Honour held that, objectively viewed, the comprehensive 34 (2014) 218 FCR 358 at 376 [52]. 35 (2014) 218 FCR 358 at 376 [53]. 36 (2014) 218 FCR 358 at 376 [53]. 37 (2014) 218 FCR 358 at 378 [63]. 38 (2014) 218 FCR 358 at 378 [64]. rights enjoyed by the Commonwealth in respect of the land by virtue of reg 54(2) and the terms of the military orders were inconsistent with any continued enjoyment of any of the rights claimed by the Bar-Barrum People39. The delegate's direction that "no person shall exercise any right of way over the land or any other right relating thereto" was destructive of the native title rights claimed, not regulatory40. There was no relevant distinction to be drawn between a grant, such as a grant of an estate in fee simple or a leasehold estate, giving exclusive possession and the taking of possession by the Commonwealth of the land pursuant to the military orders41. Those propositions were, with respect, founded upon an incorrect assessment of the operation and effect of the possession taken by the Commonwealth. Grounds of appeal The first ground of appeal is that: The Full Court erred in holding that the military orders made pursuant to reg 54 of the National Security Regulations did not have the effect of extinguishing all the native title rights and interests with respect to the Special Case land. The second ground of appeal, which only arises if the first ground fails, is that: The Full Court erred in holding that reg 54 of the National Security Regulations did not allow the Commonwealth to take possession of the Special Case land simply by the making of orders purporting to take possession of that land. Extinguishment at common law The recognition of native title rights and interests translates aspects of an indigenous society's traditional relationship to land and waters into a set of rights and interests existing at common law. The metaphor of "recognition" reflects the proposition that the common law cannot transform traditional laws and customs, the relationships to country which they define, or the rights and interests to which, in their own terms, they give rise. Nor can it extinguish them. "Extinguishment" describes the result of applying principles by which common 39 (2014) 218 FCR 358 at 391 [110]. 40 (2014) 218 FCR 358 at 391 [111]. 41 (2014) 218 FCR 358 at 391 [112]. law recognition is withheld or withdrawn in the face of legislative or executive acts affecting the land or waters in which native title is said to subsist. It was held in Mabo v Queensland [No 2] that a clear and plain intention is necessary to effect extinguishment whether directly by legislation or by executive act or grant pursuant to legislative authority42. Where the alleged extinguishing act or grant is done by the executive pursuant to legislative authority, the necessary intention to authorise such an act must be attributable to the legislature. The high threshold of attributed legislative intention flows from the seriousness of indigenous inhabitants43. So a law which merely regulates the enjoyment of native title or creates a regime of control consistent with its continued enjoyment does not, on that account only, reveal an intention to extinguish or impair native title rights and interests44. the consequences of extinguishment for Where legislation empowers the Crown to dedicate land for a public purpose the question whether the power reflects a clear and plain intention that native title affected by its exercise would be extinguished may sometimes be a question of fact, sometimes a question of law and sometimes a mixed question of fact and law. Where the exercise of the power does not involve the grant of an interest in land or the reservation or dedication of land inconsistently with the right to continued enjoyment of native title by the indigenous inhabitants, native title survives and is legally enforceable45. The clear and plain intention standard for extinguishment formulated in Mabo [No 2] is an important normative principle informing the selection of the criterion for determining whether a legislative or executive act should be taken by the common law to have extinguished native title. That standard has not been displaced by any subsequent decision of this Court. The settled criterion for its satisfaction, which has been established in the case of the grant of rights over 42 (1992) 175 CLR 1 at 64 per Brennan J (Mason CJ and McHugh J agreeing at 15), 195 per Toohey J; [1992] HCA 23. 43 (1992) 175 CLR 1 at 64 per Brennan J. 44 (1992) 175 CLR 1 at 64 per Brennan J. See also Yanner v Eaton (1999) 201 CLR 351 at 397 [115] per Gummow J; [1999] HCA 53; Akiba v The Commonwealth (2013) 250 CLR 209 at 230 [33] per French CJ and Crennan J; [2013] HCA 33; Karpany v Dietman (2013) 88 ALJR 90 at 92 [5], 95 [22], 97 [32]; 303 ALR 216 at 218, 222, 224; [2013] HCA 47. 45 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 68 per Brennan J. land or waters pursuant to a statute, as explained in Western Australia v Ward46, is inconsistency between the rights granted and the propounded native title rights and interests. Application of that criterion involves "an objective inquiry which requires identification of and comparison between the two sets of rights"47. An analogous criterion is applicable where legislation or a legislative instrument affecting the use of land or waters is concerned. The question of extinguishment is able to be answered by determining whether or not the provisions of the legislation or legislative instrument were inconsistent with the continuing recognition by the common law of the particular native title holders' rights and interests48. Where a grant of an estate in fee simple or a lease in perpetuity conferring a right of exclusive possession is concerned, inconsistency is readily demonstrable. Where a right or power is conferred for a statutory purpose and is to be exercised for that purpose, inconsistency is not demonstrated by the fact that the repository of the right or the power may use it to prevent the native title holders from exercising or enjoying their rights. The enquiry as to inconsistency begins with the construction of the statute, an exercise which is properly informed by its purpose49. In this case the limiting negative purpose to which reference has been made earlier is important to the construction of the NSA, reg 54 and the military orders. The comparison between the statutory rights and powers created and exercisable over the Bar- Barrum People's land, with their asserted native title rights and interests, follows upon the constructional exercise. That process is not to be confused with the normative question, answered by way of conclusion from the consideration of inconsistency, namely whether the statute discloses a clear and plain intention to extinguish native title. The "clear and plain intention", demonstrated by the inconsistency of statutory rights and powers and native title rights and interests, and necessary to a finding of extinguishment, is not the subjective intention of the relevant legislature, nor is it that of the executive authority making a grant. Nor is it an intention, the presence or absence of which is to be determined by reference to the awareness or otherwise of the existence of native title rights and interests 46 (2002) 213 CLR 1; [2002] HCA 28. 47 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 48 Karpany v Dietman (2013) 88 ALJR 90 at 94 [19]; 303 ALR 216 at 221. 49 Wilson v Anderson (2002) 213 CLR 401 at 417–418 [7]–[8] per Gleeson CJ; [2002] HCA 29. when the statute was enacted or the grant made50. That approach is consistent with the approach of this Court to the place of legislative intention in statutory interpretation in Project Blue Sky Inc v Australian Broadcasting Authority51, Zheng v Cai52 and Lacey v Attorney-General (Qld)53. Attributed legislative intention is a conclusion arising from the application of accepted rules of construction, both common law and statutory. In the case of the claimed extinguishment of native title, the settled approach to determining extinguishment by operation of legislation or a legislative instrument, reflected in earlier decisions of this Court, was restated in the joint judgment of Hayne, Kiefel and Bell JJ in Akiba v The Commonwealth54: "This Court held in Western Australia v The Commonwealth (Native Title Act Case) that, at common law, native title rights and interests can be extinguished by 'a valid exercise of sovereign power inconsistent with the continued enjoyment or unimpaired enjoyment of native title'." (footnotes omitted) The normative force of the clear and plain intention standard is reflected in the inconsistency criterion. So much appears from Yanner v Eaton, in which the plurality said that the "extinguishment of such rights must, by conventional theory, be clearly established" (emphasis added)55. That criterion is not satisfied merely by the identification of restrictions or controls placed on the use of the land by statute or executive act done pursuant to statutory authority. Queensland submitted that the Commonwealth had a right of exclusive possession inconsistent with the continued existence of native title rights and interests. That approach lifts the statutory conferment of "possession" out of its context, disconnects it from its statutory purpose, and thereby misconceives its legal effect. 50 Western Australia v Ward (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, 51 (1998) 194 CLR 355; [1998] HCA 28. 52 (2009) 239 CLR 446 at 455–456 [28]; [2009] HCA 52. 53 (2011) 242 CLR 573 at 591–592 [43] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; [2011] HCA 10. 54 (2013) 250 CLR 209 at 240 [61]. 55 (1999) 201 CLR 351 at 372 [35] per Gleeson CJ, Gaudron, Kirby and Hayne JJ. The possession granted to the Commonwealth, and the powers conferred as an incident of that possession, authorised the preclusion of native title holders for a time, or from time to time, from entering onto the land or waters. It may be taken to have impaired their enjoyment of their native title. However, where the law, as in this case, imposes a control regime which has a limiting purpose of not disturbing subsisting rights and interests, and where that purpose limits the scope of the rights granted and the powers conferred by the law, the impairment cannot be said to be inconsistent with the subsistence of native title rights and interests. It cannot support the conclusion that there was a "clear and plain legislative intention" to extinguish native title. In this case the position is clear. The military orders authorised, although they did not mandate, the preclusion, for their duration, of the exercise of the native title rights and interests of the Bar-Barrum People. The powers which they conferred were not unconfined. They could not support a finding of inconsistency between the statutory scheme and the native title rights and interests of the Bar-Barrum People which would lead to the conclusion that their rights or interests were extinguished. Conclusion For the preceding reasons, the first ground of appeal fails. Having regard to the basis upon which it fails, the second ground of appeal does not arise. The appeal should be dismissed with costs. Hayne The issue During World War II, pursuant to regulations made under the National Security Act 1939 (Cth), a delegate of the Minister of State for the Army made orders ("the reg 54 orders") directing a particular officer to occupy certain land, authorising that officer to do anything in relation to the land that the holder of a fee simple could do by virtue of that interest and prohibiting all other persons from exercising "any right of way over the land or any other right relating thereto". Did the reg 54 orders extinguish native title rights and interests in respect of that land? A majority of the Full Court of the Federal Court of Australia (North and Jagot JJ, Logan J dissenting) held56 that the reg 54 orders did not extinguish native title rights and interests. By special leave, the State of Queensland appeals against so much of the orders made by the Full Court as answered a question raising that issue in a special case reserved for the consideration of the Full Court. The appeal should be allowed. Other questions reserved by the special case, including a question about the application of s 51(xxxi) of the Constitution to the extinguishment of native title, were not the subject of the appeal and are not considered in these reasons. The determinative point The majority in the Full Court held57, and in this Court the first and second respondents (the Bar-Barrum people and the Commonwealth) submitted, that the objective intention, or statutory purpose, of the reg 54 orders (and the provisions pursuant to which they were made) was that "all rights and interests in the land should yield to the Commonwealth's exclusive possession" for the duration of the war (and up to six months beyond) "but should otherwise continue and found rights of compensation for the interference to those rights thereby resulting". Part of that proposition is plainly right. All rights and interests in the land were to yield to the Commonwealth's taking of exclusive possession. And the Commonwealth was to take exclusive possession of the land only for the duration of the war (and up to six months beyond). But the remainder of the proposition, however expressed, does not follow. It is both legally and logically wrong to say that the "objective intention" or 56 Congoo v Queensland (2014) 218 FCR 358. 57 (2014) 218 FCR 358 at 376 [52] per North and Jagot JJ. Hayne "statutory purpose" of the reg 54 orders or the laws pursuant to which they were made was to "preserve" all previously existing rights. The conclusion that native title rights and interests were not extinguished by the reg 54 orders is legally flawed. It takes as its premise a legal proposition for which there is no support: that native title rights and interests are extinguished only if an intention to extinguish is discernible in the reg 54 orders and the provisions pursuant to which they were made. That premise, and the conclusion which is drawn from it, are both contrary to the accepted doctrine established and unfailingly applied in this Court in a succession of cases decided over more than 20 years. And no party made any submission suggesting that any of those cases was not rightly decided. These reasons will show that the conclusion reached by the majority in the Full Court, and urged by the Bar-Barrum people and the Commonwealth, can be reached only by applying tests for the extinguishment of native title rights and interests which this Court has expressly rejected. The statement of "intention" or "purpose" is also logically flawed. It is no more than an unfounded assertion that there was no extinguishment of native title rights and interests because those rights and interests were not extinguished. Even if it is accepted as a premise that native title rights and interests are extinguished only if an intention to extinguish is discernible in the reg 54 orders and the provisions pursuant to which they were made, to state that there was an "intention" or a "purpose" to preserve all rights and interests (including native title rights and interests) leads to circular reasoning. Assuming or asserting as a second premise that there was an "intention" or "purpose" to preserve all rights and interests (then recognised or not) assumes the answer to the question that must be answered. It assumes the answer by conflating two separate inquiries. The first is an inquiry about the effect of the reg 54 orders and the provisions which authorised their making. That inquiry is answered by concluding that the Commonwealth took exclusive possession of the land for only a limited but uncertain time. The second, and separate, inquiry to make is about the effect of that taking on native title rights and interests. Assuming or asserting that there was an "intention" or "purpose" of preserving all rights and interests (then recognised or not) leads to circular reasoning. And those problems would be compounded if the statement about "intention" or "purpose" were to be understood as inviting attention58 to what the Parliament, the Executive or the Commonwealth as a polity "wanted" to achieve. Any inquiry of that kind would be anachronistic. Native title rights and interests were not recognised in the 58 cf (2014) 218 FCR 358 at 361 [6] per North and Jagot JJ. Hayne These reasons proceed as follows. First, the relevant legislative provisions and the terms of the reg 54 orders are described. Next, the native title rights and interests and the rights of possession taken by the orders are identified. The principles governing extinguishment of native title rights and interests are then stated and applied to this case. Finally, the content and utility of notions of "intention" and "purpose" in this field of discourse are examined and particular reference is made to those tests for the extinguishment of native title rights and interests which this Court has rejected. National Security (General) Regulations 1939 (Cth) Section 5(1)(b) of the National Security Act 1939 authorised the Governor-General to make regulations authorising the taking of possession or control on behalf of the Commonwealth of any property or the acquisition on behalf of the Commonwealth of any property other than land. Regulation 54(1) of the National Security (General) Regulations 1939 (Cth) ("the Regulations") provided that, if it appeared to the Minister of State for the Army to be necessary or expedient to do so in the interests of the public safety, the defence of the Commonwealth or the efficient prosecution of the war, or for maintaining supplies and services essential to the life of the community, the Minister "may, on behalf of the Commonwealth, take possession of any land, and may give such directions as appear to him to be necessary or expedient in connexion with the taking of possession of the land". Regulation 54(2) permitted the Minister to "authorize persons so using the land to do, in relation to the land, anything which any person having an unencumbered interest in fee simple in the land would be entitled to do by virtue of that interest". It further permitted the Minister, by order, to "provide for prohibiting or restricting the exercise of rights of way over the land, and of other rights relating thereto which are enjoyed by any person, whether by virtue of an interest in land or otherwise". The reg 54 orders Between 1943 and 1945, a delegate of the Minister of State for the Army, acting under reg 54 of the Regulations, made five orders with respect to land in which the Bar-Barrum people have since claimed native title rights and interests. Each order related to land in the same general area near Herberton and Atherton in North Queensland, but the borders of the land affected were not identical. The first order covered 167.4 square kilometres. The second order did not include all of the eastern part of the land covered by the first order and covered 153.3 square kilometres. The third, fourth and fifth orders covered 186.1 square kilometres, 199.4 square kilometres and 254.9 square kilometres respectively. The last three orders covered all the land which was subject to the second order but included more land to the south-west and west. Each order was annotated in a manner which indicated that the land was to be used by the Army as an artillery range. Hayne Each of the reg 54 orders stated that the officer making the order, acting in pursuance of the Regulations and the instrument delegating authority to him to make the order, "[DOES] HEREBY on behalf of the Commonwealth, TAKE POSSESSION of the said land". Each of the orders directed an officer (or persons whom that officer authorised) to occupy the land and authorised that officer (and other authorised persons) "to do in relation to the said land anything which any person having an unencumbered interest in the fee simple in the said land would be entitled to do by virtue of that interest". Each order further provided that, while the land remained in the possession of the Commonwealth, "no person shall exercise any right of way over the land or any other right relating thereto, whether by virtue of an interest in land or otherwise". No party to the appeal alleged that the reg 54 orders were made beyond power or are otherwise infirm. All said, rightly, that the reg 54 orders must be read and understood against the background of the National Security Act 1939 and the Regulations. But it is not necessary to trace that background in any detail. It is enough to observe that the parties accepted that each of the reg 54 orders would have ceased to take effect no later than the time fixed by s 19 of the National Security Act 1939 as the period of operation of that Act: the duration of the war and six months thereafter. Some agreed facts The proceedings in the Full Court of the Federal Court were by way of special case. For the purposes of that special case, the Bar-Barrum people and the State agreed that, subject to the effect of the reg 54 orders, the Bar-Barrum people hold "at least non-exclusive native title rights and interests" over the land (in effect) to go onto the land, to camp there, to hunt, fish and gather for personal, domestic and non-commercial communal purposes, to conduct ceremonies, to be buried there, to maintain places of importance and areas of significance, to teach the physical and spiritual attributes of the area, to hold meetings there and to light fires for domestic purposes. Those parties further agreed that, at about the time of the first order, "the Commonwealth physically occupied at least some of the [land] in that the Commonwealth used at least some of the [land] as an artillery range and a live fire manoeuvre range for the training of infantry and armoured units preparing to deploy to the South West Pacific area". The parties agreed that the Commonwealth ceased physically to occupy any part of the land on or about 31 August 1945. Taking possession The Bar-Barrum people and the Commonwealth submitted that there had to be some "manifestation of the intention to take possession" of the land beyond the making of the reg 54 orders. The Commonwealth's intention to take possession of this land to the exclusion of all others was evidently made plain by bombarding the land with live artillery fire and using it for live fire military Hayne manoeuvres. But the proposition that there must be some manifestation of an intention to take possession beyond the making of the relevant reg 54 order is not right. The reg 54 orders took effect according to their terms. The orders were the assertion by the Commonwealth of rights over the land, not the grant of any right or bundle of rights to a third person. The assertion of those rights was for a limited time of uncertain duration. It was an assertion which could be made only upon the decision-maker being satisfied of the matters stated in the Regulations. But, being satisfied of those matters, the officer who made an order, by making it, took possession on behalf of the Commonwealth of the land specified in it. The possession which the Commonwealth thus took was possession to the exclusion of all others. Each order authorised an identified officer (and persons whom that officer authorised) to occupy the land. Not only was this officer (and other authorised persons) authorised "to do in relation to the said land anything which any person having an unencumbered interest in the fee simple in the said land would be entitled to do by virtue of that interest", others having "any right of way over the land or any other right relating thereto" were not permitted to exercise that right. No doubt anyone could have asked for permission to go onto the land. But if, as all parties have assumed in this litigation, the reg 54 orders were valid, that permission could be refused for any reason or no reason. Permission could be refused because the Commonwealth had taken possession of the land. And taking possession had been judged to be necessary and expedient in the interests of the public safety, the defence of the Commonwealth and the efficient prosecution of the war or for maintaining supplies and services essential to the life of the community. The connection between using the land as an artillery range and live fire manoeuvre range and the defence of the Commonwealth is evident. By the reg 54 orders the Commonwealth took exclusive possession of the land. Extinguishment of native title In Western Australia v The Commonwealth (Native Title Act Case)59 the six members of this Court who had constituted the majority in Mabo v Queensland [No 2]60 said that "[a]t common law ... native title can be extinguished or impaired by a valid exercise of sovereign power inconsistent with the continued enjoyment or unimpaired enjoyment of native title". That valid exercise of sovereign power may take the form of creating rights in third parties (for example, by the grant of an interest in land). But it may also take the 59 (1995) 183 CLR 373 at 439 per Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ; [1995] HCA 47. 60 (1992) 175 CLR 1; [1992] HCA 23. Hayne form of the relevant sovereign authority itself asserting or taking rights in or over the land (for example, by some forms of dedication of land to public purposes61). The determinative question in either kind of case is whether the rights granted or asserted are inconsistent with native title rights and interests over the land. Hence, in Fejo v Northern Territory62 this Court held that native title is extinguished by a grant in fee simple and is not revived if the land is later held again by the Crown. As the plurality pointed out63 in Fejo, native title is extinguished by a grant in fee simple "because the rights that are given by a grant in fee simple are rights that are inconsistent with the native title holders continuing to hold any of the rights or interests which together make up native title". That conclusion "follows not from identifying some intention in the party making the later grant but because of the effect that that later grant has on the rights which together constitute native title"64 (emphasis added). It is against this background, then, that the decision in Western Australia v Ward65 must be understood. And despite the degree of attention given in argument in this case to only one paragraph of what was written in Ward66, what was said by the plurality in that case cannot be read as altering or detracting from what was then, and remains, the established doctrine of this Court. Common law extinguishment of native title rights and interests depends upon only one test: inconsistency of rights. As the plurality said67 in Ward, "[t]wo rights are inconsistent or they are not. If they are inconsistent, there will be extinguishment to the extent of the inconsistency; if they are not, there will not be extinguishment." And "[a]bsent particular statutory provision to the contrary, questions of suspension of one set of rights in favour of another do not 61 Mabo [No 2] (1992) 175 CLR 1 at 68 per Brennan J; Western Australia v Ward (2002) 213 CLR 1 at 136 [214]-[215] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; [2002] HCA 28. 62 (1998) 195 CLR 96; [1998] HCA 58. 63 (1998) 195 CLR 96 at 126 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, 64 (1998) 195 CLR 96 at 128 [47] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ, citing Mabo [No 2] (1992) 175 CLR 1 at 68 per Brennan J. 65 (2002) 213 CLR 1. 66 (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 67 (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. Hayne Rather, questions of arise"68 (emphasis added). inconsistency require identification of, and comparison between, the two sets of rights, recognising always that one set of rights derives from traditional law and custom and the other set derives from the exercise of the new sovereign authority that came with European settlement. No case decided after Ward holds to the contrary. It is enough, for present purposes, to refer only to Western Australia v Brown69. All five members of the Court agreed70 that the principles to be applied are those that have been stated. Application of the principles By taking exclusive possession of the land, the Commonwealth asserted rights which were inconsistent with the native title rights and interests in issue in this case. The Commonwealth's acts extinguished the native title rights and interests claimed by the Bar-Barrum people. Contrary the submissions of the Bar-Barrum people and the Commonwealth, the effect of the reg 54 orders on native title rights and interests was more radical than working only some temporary suspension of their enjoyment, whether with or without some concomitant grant of a right to compensation for loss of enjoyment of the rights. Analysis in terms of suspension of either the native title rights and interests or their exercise (with or without the addition of a right to monetary compensation) fails to recognise the manner in which the common law and native title rights and interests intersect. In particular, analysis of the kind described does not take into account the facts71 that native title rights and interests are rooted in the laws and customs observed by the claimant people and that while native title is recognised by the common law it is neither an institution of the common law nor a form of common law tenure. The failure to recognise the manner in which the common law and native title rights and interests intersect results in seeking to attach incidents of 68 (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 69 (2014) 88 ALJR 461; 306 ALR 168; [2014] HCA 8. 70 (2014) 88 ALJR 461 at 467-468 [34]-[38] per French CJ, Hayne, Kiefel, Gageler and Keane JJ; 306 ALR 168 at 175-176. 71 Mabo [No 2] (1992) 175 CLR 1 at 58-59 per Brennan J; Fejo (1998) 195 CLR 96 at 128 [46] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; Yorta Yorta Aboriginal Community v Victoria (2002) 214 CLR 422 at 439 [31] per Gleeson CJ, Gummow and Hayne JJ; [2002] HCA 58. Hayne suspension and monetary compensation deriving from the common law of real property and trespass to native title rights and interests deriving from a different normative system. As was pointed out72 in Yorta Yorta Aboriginal Community v Victoria, native title rights and interests "may not, and often will not, correspond with rights and interests in land familiar to the Anglo-Australian property lawyer" and "[t]he rights and interests under traditional laws and customs will often reflect a different conception of 'property' or 'belonging'". The error of seeking to transfer common law ideas about real property and trespass to native title rights and interests is most starkly exemplified by the attempt to transform the spiritual attachment to land which underpins native title rights and interests into money damages for the tort of trespass. It is convenient to assume that competent legislation could validly suspend the exercise of native title rights and interests and attach to those rights and interests, first, some statutory right to resume their exercise on the happening of some event and, second, some right to compensation for interruption in their exercise. In Ward, the plurality referred73 to the possibility of a "particular statutory provision" suspending native title rights and interests. It may greatly be doubted that legislation could achieve these results except by express and detailed provision to the desired effect. But assuming, for the purposes of argument, that legislation could inferentially or impliedly superimpose such incidents upon, or attach such incidents to, native title rights and interests, the legislation at issue in this case cannot be understood as having that effect. That legislation validly authorised the Commonwealth to take to itself rights over the land which were inconsistent with the native title rights and interests that have been described. The view that the legislation worked only a temporary suspension of the exercise of the native title rights and interests depends upon assuming or asserting either that the applicable statutory and regulatory provisions intended to preserve all other interests or that they should be construed as having that effect. There is no basis for making an assumption or assertion of that all-encompassing generality. None was identified in argument. It is important, however, to say something more about the content and utility of notions of "intention" and "purpose" in this field of discourse. "Intention" and "purpose" The metaphors of "intention" and "purpose" will mislead if they are understood as permitting or requiring identification of some actual or constructed objective for the act which it is alleged extinguished native title rights and 72 (2002) 214 CLR 422 at 442 [40] per Gleeson CJ, Gummow and Hayne JJ. 73 (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. Hayne interests. Hence, as the plurality said74 in Ward, "referring to an 'expression of intention' is apt to mislead" (original emphasis). As the plurality also said75 in Ward, references to expression of "intention" and "purpose" are apt to mislead because the subjective thought processes of those whose act is alleged to have extinguished native title are irrelevant. It matters not whether those who made the reg 54 orders did or did not think about what rights and interests the Bar-Barrum people would claim in the land. And it matters not whether those who made the reg 54 orders did or did not think about what rights or interests in the land would survive beyond the expiration of the orders. It is irrelevant, therefore, to observe, as the majority did in the Full Court76, that in the course of the second reading of the Bill for what became the National Security Act 1939, the Prime Minister spoke77 of the Executive being guided in the exercise of the powers given by that Act by the principle that there be "as little interference with individual rights as is consistent with concerted national effort". There are fundamental reasons why references to "intention" and "purpose" may mislead. As has already been explained, native title is neither an institution of the common law nor a form of common law tenure, but is recognised by the common law. There is, therefore, an intersection of two Identifying the intersection may be assisted79, in some cases, by using the idea of radical title as a tool of legal analysis. But the concept of radical title does not have a controlling role80. And as the decisions in The Commonwealth v 74 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 75 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 76 (2014) 218 FCR 358 at 361 [6] per North and Jagot JJ. 77 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 September 1939 at 164. 78 Yorta Yorta (2002) 214 CLR 422 at 441-443 [39]-[42] per Gleeson CJ, Gummow 79 The Commonwealth v Yarmirr (2001) 208 CLR 1 at 51 [48]-[49] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; [2001] HCA 56. 80 Yarmirr (2001) 208 CLR 1 at 51 [49] per Gleeson CJ, Gaudron, Gummow and Hayne Yarmirr81 and subsequent cases82 show, an inquiry about extinguishment of native title rights and interests must begin by examining the allegedly inconsistent rights and interests which have been created and asserted since the Crown's acquisition of sovereignty. It is, therefore, irrelevant to notice, as the majority in the Full Court did83, that the Commonwealth was not the holder of the radical title in the land the subject of the reg 54 orders. To say, as their Honours did84, that the Commonwealth "was a stranger to the land and indifferent to the nature and extent of pre-existing interests which might be held in relation to the land" suggests, wrongly, that radical title to the land is the controlling concept, and deflects attention from the central and determinative issue of whether the rights asserted by the Commonwealth were inconsistent with the claimed native title rights and interests. Reference to purpose may mislead in another way. It is, of course, well established that the legislative power, given by s 51(vi) of the Constitution, to make laws with respect to "the naval and military defence of the Commonwealth and of the several States" is purposive85. And it is equally clear that the powers given by reg 54(1) of the Regulations had to be exercised for the purposes described in the regulation. It by no means follows, however, from either of these observations about power that the rights which the Commonwealth asserted over the land were not rights of exclusive possession of the land for the duration of the war. What was said in Ward86 does not support the proposition that a power conferred for a statutory purpose, to be exercised for that purpose, may not create rights which are inconsistent with native title rights and interests. 81 (2001) 208 CLR 1 at 48-49 [41]-[42], 60-61 [76], 68 [99]-[100] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 82 See, for example, Ward (2002) 213 CLR 1 at 91 [82], 115 [151]-[152], 136 [215] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 83 (2014) 218 FCR 358 at 375 [51]. 84 (2014) 218 FCR 358 at 375 [51]. 85 See, for example, Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 273 per Kitto J; [1951] HCA 5; Thomas v Mowbray (2007) 233 CLR 307 at 359-364 [132]-[148] per Gummow and Crennan JJ; [2007] HCA 33. 86 (2002) 213 CLR 1 at 165-166 [307]-[308], 172 [326], 174 [331]. Hayne Nor does it follow from the observations about the purposive nature of the relevant legislative power or the purposes for which the power given by the Regulations could be exercised that any analogy can be drawn between the reg 54 orders and the mining interests that were considered in either Ward or Brown. What was said87 in Ward about the mining interests in issue in that case illustrates the fundamental importance of identifying what are the rights and interests which it is said are inconsistent with native title rights and interests. Any supposed analogy between the reg 54 orders and the mining interests considered in Ward and Brown founders on the rock of the radical difference between the two kinds of right. The reg 54 orders gave the right to take possession of land to the exclusion of all others, albeit for a limited time. The mining interests in issue in Ward and Brown gave the holder exclusive rights only to search for and win whatever minerals were to be found on the relevant land. In this case, the majority in the Full Court treated88 inconsistency of rights as no more than "an analytical tool enabling objective legislative intention to be ascertained". At the very least, an approach of this kind inverts the proper order of inquiry, for it appears to suggest that deciding that there is inconsistency of rights requires some further inquiry into what is called an "objective intention". But, as used by the majority in the Full Court, that approach led to the legal and logical errors identified at the commencement of these reasons. It is necessary to amplify that conclusion. The majority identified89 the relevant "objective legislative intention" as being "that native title rights no longer be recognised by the common law". Their Honours accepted90 that "the Commonwealth took to itself a right of exclusive possession" but concluded91 that "the Commonwealth cannot be imputed with an objective intention to extinguish native title rights and interests". And their Honours founded92 that conclusion on the proposition that "[t]he context and language of the statute does not disclose any intention, let alone a clear and plain intention, that any rights or interests in the land no longer be 87 (2002) 213 CLR 1 at 159-160 [290]. 88 (2014) 218 FCR 358 at 375 [50]. 89 (2014) 218 FCR 358 at 375 [50]. 90 (2014) 218 FCR 358 at 375 [52]. 91 (2014) 218 FCR 358 at 375 [52]. 92 (2014) 218 FCR 358 at 375 [52]. Hayne recognised". Rather, the objective intention of the Commonwealth was said93 to be "that all rights and interests in the land should yield to the Commonwealth's exclusive possession for the duration of the Commonwealth's exercise of power under reg 54 but should otherwise continue and found rights of compensation for the interference to those rights thereby resulting". For the reasons already given, the proposition takes its conclusion as its premise. It is circular. Reverting to rejected tests of extinguishment An important part of the ratio decidendi of Ward is94 the rejection of tests of extinguishment other than the inconsistency of rights test which had been established in earlier decisions of this Court. Three particular forms of other test were specifically rejected: (a) the adverse dominion test suggested in Delgamuukw v British Columbia95, (b) a test dependent upon so-called "permanent" adverse dominion, and (c) a test dependent upon degrees of inconsistency. No party submitted that any of these tests could or should be applied. Yet the repeated reference in this case to the temporary nature of the rights taken by the Commonwealth and the temporary nature of the circumstances which permitted that step can be explained only as seeking to revive one or other of the tests that were expressly rejected in Ward. As has already been explained, the rights which the Commonwealth took for itself over the land were rights of exclusive possession. The temporal duration of those rights was not certain. But the rights were no different in kind or duration from those a tenant would have under a lease granted for the term of the life of another. And it was not, and could not be, disputed that a lease of that kind would extinguish native title. Yet a constant thread, running through both the reasoning of the majority in the Full Court and the arguments advanced on behalf of the Bar-Barrum people and the Commonwealth, was that the Commonwealth took possession of the land for a limited time and could do that only because circumstances which would not continue permanently were found then to exist. It followed, according to this thread, that the native title rights and interests could not have been, and were not, extinguished, because the rights which the Commonwealth had asserted over the land were not permanent and were occasioned by extraordinary circumstances. 93 (2014) 218 FCR 358 at 376 [52]. 94 (2002) 213 CLR 1 at 88-91 [74]-[82] per Gleeson CJ, Gaudron, Gummow and 95 (1993) 104 DLR (4th) 470 at 670-672 per Lambert JA. Hayne The premise for that argument can only be that native title rights and interests cannot be extinguished without some exercise of adverse dominion over the land96 (perhaps some exercise of permanent adverse dominion97) or cannot be extinguished unless the rights which are taken "totally replace" or "fully eclipse"98 the claimed native title rights and interests. And, as already explained, those tests were rejected in Ward. None of them is now to be reintroduced into the law in Australia by taking it as an unstated premise for argument. The question of extinguishment is to be decided according to established principles. That the Commonwealth took exclusive possession for a limited but uncertain time does not deny that the rights which were taken were inconsistent with the native title rights and interests described earlier in these reasons. And because the Commonwealth's rights over the land were inconsistent with those native title rights and interests, the native title rights and interests were extinguished. The fact that the Commonwealth ceased asserting exclusive possession of the land on or about 31 August 1945 did not revive those native title rights and interests. As cases like Fejo demonstrate, cessation of inconsistent rights does not revive native title rights and interests. Conclusion By taking exclusive possession of the land, the Commonwealth asserted rights which were inconsistent with the native title rights and interests in issue in this case. The Commonwealth's acts extinguished the native title rights and interests of the Bar-Barrum people. Question 3 of the questions reserved for the consideration of the Full Court of the Federal Court should have been answered as follows: Did the act of the Commonwealth in (a) making the Military Orders wholly extinguish all native title rights and interests that then subsisted on the special case land, and, if not, 96 cf Ward (2002) 213 CLR 1 at 88-90 [74]-[79] per Gleeson CJ, Gaudron, Gummow 97 cf Ward (2002) 213 CLR 1 at 90 [80] per Gleeson CJ, Gaudron, Gummow and 98 cf Ward (2002) 213 CLR 1 at 90-91 [81]-[82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. See also Western Australia v Ward (2000) 99 FCR 316 at 489 [689] Hayne being in physical occupation of at least some of the special case land pursuant to the Military Orders wholly extinguish all native title rights and interests that then subsisted on the special case land or that part of the special case land that had been physically occupied? Answer: (a) Yes. (b) Unnecessary to answer. The appeal to this Court should be allowed. The orders of the Full Court of the Federal Court of Australia made on 21 February 2014 should be varied by setting aside par 1(c) and substituting the answers to question 3 set out above. Consistent with the terms on which special leave to appeal was granted, the appellant should pay the first respondents' costs of the appeal to this Court. There should be no other order as to the costs of the appeal to this Court. KIEFEL J. The land in question in this appeal falls within the boundaries of an application brought by the Bar-Barrum People for a determination of native title with respect to land in North Queensland and has been the subject of a determination of a Special Case by a Full Court of the Federal Court. It is accepted by the parties to the Special Case that some native title rights over the land were extinguished by the grants of a pastoral lease and mineral leases in the late 19th and early 20th centuries. Between 1943 and 1945 part of the land was the subject of Military Orders issued pursuant to regulations made under the National Security Act 1939 (Cth). That Act provided for extraordinary war time powers of possession and control of property and it did so at a time when the common law had not yet recognised native title rights and interests. It is accepted by the parties that, subject to the effect of the Military Orders, the Bar-Barrum claimants (the first respondents) hold at least non-exclusive native title rights and interests over the land. The question raised by the Special Case, the subject of this appeal, is whether the Military Orders extinguished those native title rights and interests. The test for extinguishment of native title The question whether native title rights and interests are extinguished by the grant of rights over the same land is answered by a consideration of whether the rights granted are inconsistent with the native title rights and interests, in the sense that the two sets of rights cannot be exercised at the same time. Although inconsistency of rights was identified as central to the question of extinguishment in Mabo v Queensland [No 2]99, the method by which it was to be tested was not resolved until later. In Western Australia v Ward100, the joint judgment was able to say that: "As Wik101 and Fejo102 reveal, where, pursuant to statute, be it Commonwealth, State or Territory, there has been a grant of rights to third parties, the question is whether the rights are inconsistent with the alleged native title rights and interests. That is an objective inquiry which requires identification of and comparison between the two sets of rights." 99 (1992) 175 CLR 1 at 68, 69-70; [1992] HCA 23. 100 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; see also at 250 [589] per Kirby J; [2002] HCA 28. 101 Wik Peoples v Queensland (1996) 187 CLR 1 at 185-186; [1996] HCA 40. 102 Fejo v Northern Territory (1998) 195 CLR 96 at 126 [43]; [1998] HCA 58. In Western Australia v Brown103, a Full Court of this Court pointed out that this inquiry involves at the first stage the identification of the property rights granted. This stage involves the ascertainment of the legal nature and content of those rights. The second stage involves identifying the claimed native title rights and interests. The final stage involves the determination of whether there is an inconsistency between the two sets of rights. Each stage of the inquiry is objective. A determination of whether there is an inconsistency between the rights granted and the native title rights is to be decided by reference to the nature and content of the rights as they stood at the time of the grant104. In Wik Peoples v "If the rights conferred on the lessee of a pastoral lease are, at the moment when those rights are conferred, inconsistent with a continued right to enjoy native title, native title is extinguished." (footnote omitted) In Brown106, it was reiterated that the question is: "[a]t that time, were the rights as granted inconsistent with the relevant native title rights and interests?" (emphasis in original) Logically, the two sets of rights must be tested for inconsistency at the time of the grant of the later set, because the question of inconsistency is directed to whether the native title rights can continue after the grant is made. Inconsistency, the Court said in Brown107, is "that state of affairs where 'the existence of one right necessarily implies the non-existence of the other'." Where the Crown creates rights inconsistent with "a continuing right to enjoy native title", native title is extinguished to the extent of the inconsistency108. If 103 (2014) 88 ALJR 461 at 467-468 [33]-[38] per French CJ, Hayne, Kiefel, Gageler and Keane JJ; 306 ALR 168 at 175-176; [2014] HCA 8. 104 Western Australia v Brown (2014) 88 ALJR 461 at 468 [37]; 306 ALR 168 at 176. 105 (1996) 187 CLR 1 at 87, Dawson and McHugh JJ agreeing. 106 (2014) 88 ALJR 461 at 468 [37]; 306 ALR 168 at 176. 107 (2014) 88 ALJR 461 at 468 [38]; 306 ALR 168 at 176, quoting from submissions by counsel for the first respondents. 108 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 69-70 per Brennan J; Wik Peoples v Queensland (1996) 187 CLR 1 at 84-86, 87 per Brennan CJ, Dawson and the right granted prevents the lawful exercise of native title rights, the latter are extinguished. It was made clear in Ward109, Wilson v Anderson110 and Fejo v Northern Territory111 that a right of exclusive possession of land leaves "no room for the continued existence of [native title] rights and interests"112. The native title rights spoken of are those the exercise of which depends upon access to the land. Native title rights cannot continue because the right of exclusive possession affords the holder the right to "exclude any and everyone from access to the land."113 In Ward, a pastoral lease, granted for one year and renewable from year to year, was held to be inconsistent with native title rights and interests because it gave a right of exclusive possession to the land in question with the result that the native title rights and interests were extinguished114. By contrast, the grant of a mining lease might not be inconsistent with all native title. In this respect it was observed in Ward115 that a lease for mining purposes might not require the exclusion of all others from all parts of the land but, inferentially, only from those parts necessary to its exercise. A right to mine may prevent the exercise of some native title rights and interests, but it was not possible there to identify those which might be subject to extinguishment and those which were not. The exception was a native title right to control access to land, which would have been extinguished by the grant of the mining leases. The test of inconsistency is admittedly strict. It requires the identification of the native title rights and interests and the rights and interests which are said to be inconsistent with them. The joint judgment in Ward116 described as false the 109 (2002) 213 CLR 1 at 182 [370], 201 [439], 210 [468], 239 [555], 250 [589], 263 110 (2002) 213 CLR 401 at 419 [11]-[12], 455 [131], 466 [165]; [2002] HCA 29. 111 (1998) 195 CLR 96 at 151 [105]. 112 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 73; see also at 155. 113 Fejo v Northern Territory (1998) 195 CLR 96 at 128 [47], quoted in Western Australia v Brown (2014) 88 ALJR 461 at 468 [36]; 306 ALR 168 at 175. 114 Western Australia v Ward (2002) 213 CLR 1 at 181 [368], 182 [370]. 115 (2002) 213 CLR 1 at 165-166 [306]-[309]. 116 (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. premise that "there can be degrees of inconsistency of rights, only some of which can be described as 'total', 'fundamental' or 'absolute'." The joint judgment went on to say: "Two rights are inconsistent or they are not. If they are inconsistent, there will be extinguishment to the extent of the inconsistency; if they are not, there will not be extinguishment." It was further said that, when testing for inconsistency, no question of the suspension of one set of rights in favour of another can arise, absent particular statutory provision. It follows that if an inconsistency is found to arise when a right is granted over land, because the right granted prevents the exercise of native title rights, the fact that it may be temporary in its effect will not prevent the extinguishment of native title rights and interests. Extinguishment does not depend on the inconsistency between the rights enduring permanently or even for a particular period. The Commonwealth Regulations and Orders The relevant provisions of the National Security Act 1939, the National Security (General) Regulations (Cth) made under that Act and the Military Orders made under reg 54 are set out in full in the reasons of other members of the Court. There is no issue in these proceedings that reg 54 of the Regulations was made pursuant to s 5(1)(b)(i) of the Act, which provided for the making of regulations "for securing the public safety and the defence of the Commonwealth ... and in particular ... (b) for authorizing — (i) the taking of possession or control, on behalf of the Commonwealth, of any property". The Second Reading Speech described the Act as a "far-reaching measure which gives extensive powers to the Government"117. The Act was to continue in operation for the duration of the Second World War and for a period of six months thereafter118. At the time the Act was passed, the cessation of hostilities could not be predicted. Regulation 54(1) provided that the Minister of State for the Army, when it appeared necessary or expedient for the defence of the Commonwealth or the efficient prosecution of the war, could take possession of any land and give such directions as appeared necessary or expedient in connection with taking possession. Regulation 54(2) provided that the Minister could also (a) authorise 117 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 September 1939 at 163. 118 National Security Act 1939 (Cth), s 19. Section 19 was repealed and replaced by s 9 of the National Security Act 1940 (Cth), which was to relevantly similar effect. persons using the land for the purpose of the regulation to do anything which a person having an unencumbered interest in fee simple in the land would be entitled to do; and (b) by order prohibit or restrict the exercise of rights relating to the land, including rights of way. On five occasions between 1943 and 1945, a Minister's delegate made Military Orders under reg 54 ("the Military Orders") with respect to the land in question, which was then used as an artillery range and live fire manoeuvre range for the training of infantry and armoured units to be deployed to the South West Pacific. By the Military Orders, possession was taken of the land, and a person was authorised to occupy and use it to do anything an owner of the land would be entitled to do. It was further ordered that, whilst the land remained in the Commonwealth's possession, "no person shall exercise any right of way over the land or any other right relating thereto, whether by virtue of an interest in land or otherwise". The nature of the right under reg 54(2) Regulation 54 provided a right of exclusive possession, in the nature of a property right, for an indefinite period. The judgments of the majority in Minister of State for the Army v Dalziel119 are to this effect. Mr Dalziel was the tenant and occupier of land in central Sydney, upon which he conducted a car park. The Commonwealth took possession of the land by notice under reg 54. The issue was whether the taking amounted to an acquisition of property within the meaning of s 51(xxxi) of the Constitution. Williams J, in concluding that the Commonwealth acquired an interest in the land, said120: "possession under a statutory title which gives the Commonwealth for an indefinite period, which may last during the war and for six months thereafter, an exclusive right to possess the land against the whole world, including the persons rightfully entitled to the possession of the land at common law, must be, a fortiori, an acquisition of an interest in the land." "the operation and effect of the regulation gives the Commonwealth the right to possession of the land of another for a period, limited only as already mentioned, and to do in relation to the land anything which any 119 (1944) 68 CLR 261; [1944] HCA 4. 120 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 299. 121 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 290. person having an unencumbered interest in fee simple in the land would be entitled to do by virtue of that interest". Rich J122 considered that the Minister had taken away "everything that made [Mr Dalziel's] weekly tenancy worth having, and has left him with the empty husk of tenancy", implying that the Minister had the right to do so by virtue of the regulation. In the present case, neither the Full Court of the Federal Court123 nor the Commonwealth denied that the Commonwealth had been granted rights in the nature of exclusive possession. In this Court, the first respondents submitted that this aspect of the rights was "something of a distraction". This submission is to be understood in light of the submission made by the Commonwealth, which was accepted by the Full Court, that the rights given to the Commonwealth should nevertheless be viewed as limited in duration and limited to the purposes of the legislation. A consequence of the impermanent nature of the Commonwealth's rights, on the Commonwealth's argument, was that all other rights were intended to continue124. It was recognised in Dalziel125 that, although the Commonwealth's possession at the time was to be considered indefinite, it was nevertheless a temporary possession. However, the observation there made was relevant to a submission that for there to be an acquisition of land, a taking of it must be permanent. It is not relevant to the question of inconsistency between property rights and native title rights. On the current state of authority, the impermanent nature of the Commonwealth's right of possession is irrelevant to the question whether, at the time of the grant, that right is inconsistent with a continuing right to enjoy native title; yet it is this aspect of the Commonwealth's right which lies at the heart of the submissions of the Commonwealth and the reasoning of the Full Court of the Federal Court. 122 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 286. 123 Congoo v Queensland (2014) 218 FCR 358 at 375-376 [52]-[53], 377 [57], 392 124 Congoo v Queensland (2014) 218 FCR 358 at 368-369 [27]-[28]. 125 (1944) 68 CLR 261 at 290 per Starke J; see also at 286 per Rich J. The native title rights and interests It is agreed that the native title rights and interests of the Bar-Barrum People comprise at least non-exclusive rights to go onto the land in question, to camp there, to hunt, fish and gather for personal, domestic and non-commercial communal purposes, to conduct ceremonies, to be buried there, to maintain places of importance and areas of significance, to teach the physical and spiritual attributes of the area, to hold meetings there and to light fires for domestic purposes. The exercise of these rights requires access to the land. It is difficult to see that a grant to the Commonwealth of a right to exclude all others from the land, which had been carried into effect by the Military Orders, could co-exist with native title rights of this kind. Extinguishment? The majority in the Full Court of the Federal Court (North and Jagot JJ, Logan J dissenting) accepted that the Commonwealth took to itself a right of exclusive possession126 and that a consequence of the grant of rights to the Commonwealth was that the native title rights could not be exercised127. The majority also accepted128, given what had been said in Ward, that the matter could not be approached on the basis that the native title rights and interests were suspended during the exercise of the Commonwealth's power. The answer, in the view of the majority, lay in legislative intention. Their Honours129 considered that: "the Commonwealth cannot be imputed with an objective intention to extinguish native title rights and interests. The context and language of the statute does not disclose any intention, let alone a clear and plain intention, that any rights or interests in the land no longer be recognised." Before turning to consider the basis for this legislative intention, it is as well to recall that this Court has repeatedly warned against a misunderstanding of legislative intention in this context. In Ward130, immediately preceding the 126 Congoo v Queensland (2014) 218 FCR 358 at 375-376 [52]. 127 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]. 128 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]. 129 Congoo v Queensland (2014) 218 FCR 358 at 375 [52]. 130 (2002) 213 CLR 1 at 89 [78]. statement, which is set out earlier in these reasons, regarding the question of inconsistency revealed by Wik and Fejo, Gleeson CJ, Gaudron, Gummow and "The cases often refer to the need for those who contend that native title has been extinguished to demonstrate a 'clear and plain intention' to do so. That expression, however, must not be misunderstood. The subjective thought processes of those whose act is alleged to have extinguished native title are irrelevant. Nor is it relevant to consider whether, at the time of the act alleged to extinguish native title, the existence of, or the fact of exercise of, native title rights and interests were present to the minds of those whose act is alleged to have extinguished native title. It follows that referring to an 'expression of intention' is apt to mislead in these respects." (emphasis in original; footnotes omitted) And in Fejo131, six members of this Court explained that native title is not extinguished because of any intention in the party making the grant of later rights, but because of the effect that the later grant has on the rights which constitute native title. The majority in the Full Court said that the basis for the intention which was to be imputed to the legislature was to be derived from the legislative scheme and the premise apparent from it that "all underlying rights and interests should continue."132 This reflects acceptance of the Bar-Barrum claimants' and the Commonwealth's submissions to that Court133, which also pointed out that it followed from that premise that "[o]nce the Commonwealth's possession ... ceased, all rights, including native title rights, could once more be exercised." The legislative intention that all rights, including native title rights, continued to exist134 was considered by the majority in the Full Court to result in there being no inconsistency. After acknowledging that such rights could not be exercised over the land whilst reg 54 and the Military Orders remained in effect, the majority said135: 131 (1998) 195 CLR 96 at 128 [47]. 132 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]. 133 Congoo v Queensland (2014) 218 FCR 358 at 366 [21]-[22]. 134 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]-[54]. 135 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]. "But this does not mean that the rights which the Commonwealth took to itself were inconsistent with the continued existence of native title rights. This is because, as the Commonwealth submitted, it took to itself exclusive possession for a limited purpose for a limited time on the objectively ascertainable premise apparent from the legislative scheme that all underlying rights and interests should continue." This does not appear to be an application of the test of inconsistency of rights, nor did the majority suggest that it was. The inconsistency of rights test was relegated to the status of an "analytical tool enabling objective legislative intention to be ascertained."136 The majority said137: inconsistency as the development of "The reasons of French CJ and Crennan J at [30]-[35] in Akiba for explain extinguishment, inconsistency being a tool to determine legislative objective intention in circumstances where the purposive approach to statutory construction might otherwise be confounded by the fact that statutes enacted before Mabo (No 2) incorrectly assumed that the common law did not recognise native title rights and interests. The analysis of Hayne, Kiefel and Bell JJ at [61]-[64] is to the same effect." (emphasis added) the criterion It should not be understood from the words emphasised in this passage that the judgments in Akiba v The Commonwealth138 there referred to support the proposition there stated. They do not. In the passages from the judgment of French CJ and Crennan J in Akiba to which the majority referred, the history of the development of the test of inconsistency was traced. Their Honours pointed139 to the "early approach of this Court in Mabo v Queensland140 and Mabo v Queensland [No 2]" (footnote omitted). In those cases it was said that native title is not extinguished unless there be a clear and plain intention to do so141. French CJ and Crennan J in Akiba 136 Congoo v Queensland (2014) 218 FCR 358 at 375 [50]. 137 Congoo v Queensland (2014) 218 FCR 358 at 375 [49]. 138 (2013) 250 CLR 209; [2013] HCA 33. 139 Akiba v The Commonwealth (2013) 250 CLR 209 at 229 [30]. 140 (1988) 166 CLR 186; [1988] HCA 69. 141 Mabo v Queensland (1988) 166 CLR 186 at 213-214; Mabo v Queensland [No 2] (1992) 175 CLR 1 at 64, 195; see also at 111. observed that the difficulty with a purposive approach to construction is identifying such an intention, given the reality, identified by Gummow J in Wik142, that many statutes were enacted at a time "when the existing state of the law was perceived to be the opposite of that which it since has been held then to have been." Their Honours explained143 that the Court came to focus upon inconsistency as the criterion for extinguishment and that the pre-eminence of inconsistency as the criterion was restated in Ward, where the joint judgment also warned against144 a misunderstanding of the criterion of "clear and plain intention". It is difficult to see that a legislative intention could be derived by applying the common law test of inconsistency of rights. That test involves the comparison of two sets of rights. This process is not one of statutory construction, by which legislative intention may be inferred. The conclusion to be reached by the comparison is inconsistency or not and this conclusion is not the legislative intention to which the majority in the Full Court referred. It is not meant, by the foregoing, to deny that legislative intention may be relevant to the test of inconsistency of rights. But that intention would assist only in reaching a conclusion as to the nature of the rights granted under the legislation and would be ascertained by ordinary processes of statutory construction, by reference to text and context. As Gummow J said in Wik145, adopting the statement of Holmes: "[w]e do not inquire what the legislature meant; we ask only what the statute means"146. The Commonwealth and the majority in the Full Court identified two principal features of reg 54 and the National Security Act 1939 as relevant to an intention that pre-existing rights in the land continue, namely that the rights granted to the Commonwealth were limited by legislative purpose and they were limited in duration. The first respondents also sought to draw a limitation from the war time purposes of reg 54. It was said that the Commonwealth did not have an unqualified right to exclude others from access to the land "for any reason or no 142 (1996) 187 CLR 1 at 184. 143 Akiba v The Commonwealth (2013) 250 CLR 209 at 231 [35]. 144 Western Australia v Ward (2002) 213 CLR 1 at 89 [78]. 145 (1996) 187 CLR 1 at 169. 146 Holmes, "The Theory of Legal Interpretation", (1899) 12 Harvard Law Review 417 reason", which is an aspect of a right of exclusive possession at common law. The Commonwealth could only exclude for a reason consistent with the purposes of the National Security Act 1939. However, it was not suggested that reg 54 and the Military Orders were not made consistently with that purpose. The first respondents did not explain why they say that the fact that the right of exclusive possession is limited to particular statutory purposes means that this possession is not inconsistent with native title rights. It is the limited duration of reg 54 which assumes importance to the argument that it may be seen as intended that "all rights" continued. The real question is whether that feature of the regulation and the Military Orders is relevant to the continuance of native title rights and interests and to the question of their extinguishment. It may be inferred that some rights and interests in the land continued in effect during the currency of reg 54 and the Military Orders. In Minister for Interior v Brisbane Amateur Turf Club147, Dixon J observed that a right of possession could be granted under a lease, despite the Commonwealth being in actual possession under reg 54. Of course that right could not be exercised whilst the regulation and Military Orders remained in force. However, upon their cessation, rights of possession could be taken up or resumed and rights respecting the land which had been interfered with might be the subject of orders for compensation. It is rights of these kinds, those of owner or tenant, which may be said to continue and be capable of resumption. The rights of such persons to possession and to access the land may be regarded, in a sense, as suspended by reg 54 and the Military Orders. Such rights cannot be equated with native title rights and interests and it is not possible to regard native title rights and interests as suspended by the grant of further interests. Native title rights and interests are different from forms of common law tenure. Whilst native title rights and interests are recognised by the common law, they have an origin distinct from it. In Fejo148, in the reasons of six members of this Court, it was explained that: "The underlying existence of the traditional laws and customs is a necessary pre-requisite for native title but their existence is not a sufficient basis for recognising native title. And yet the argument that a grant in fee simple does not extinguish, but merely suspends, native title is an 147 (1949) 80 CLR 123 at 162; [1949] HCA 31. 148 (1998) 195 CLR 96 at 128 [46] per Gleeson CJ, Gaudron, McHugh, Gummow, argument that seeks to convert the fact of continued connection with the land into a right to maintain that connection." (emphasis in original) The test of inconsistency of rights is predicated upon the fact that native title rights and interests are different from others and that they are affected by the grant of further rights over the land in a way different from other rights and interests in the land. On the present state of the law it is irrelevant to the question of extinguishment of native title rights and interests that a right granted with respect to land is impermanent. As the majority in the Full Court observed149, Ward establishes that even if temporary, a lease granting exclusive possession results in extinguishment. The majority accepted150 that it was not possible to treat the native title rights as suspended by the Military Orders made under reg 54. The majority sought to distinguish Ward on the basis of an imputed legislative intention. It was not suggested that reg 54 was of the exceptional kind of provision to which Ward referred151, which might actually provide for suspension. For the reasons given above, the approach by the majority in the Full Court was incorrect. Conclusion It may be accepted that the legislative provisions in question were extraordinary war time powers and were limited in their duration. These features do not affect the test of inconsistency of rights which previous decisions of this Court apply as the criterion of extinguishment. The decisions of this Court do not permit native title rights and interests to be regarded as suspended when applying the test of inconsistency of rights, yet this appears to me to be the effect of the argument put for non-extinguishment. No challenge was made to what was said in Ward and other cases. It was not put in argument on this appeal that the test of inconsistency of rights should be revisited. The appeal should be allowed. Question 3 in the Special Case should have been answered in the terms proposed by Hayne J. The orders of the Full Court of the Federal Court should be varied accordingly. 149 Congoo v Queensland (2014) 218 FCR 358 at 376 [54]. 150 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]. 151 Western Australia v Ward (2002) 213 CLR 1 at 91 [82]. Bell BELL J. The facts, procedural history and terms of the relevant provisions of the National Security Act 1939 (Cth) ("the NSA") and the National Security (General) Regulations 1939 (Cth) ("the Regulations") are set out in the reasons of other members of the Court and need not be repeated save to the extent necessary to explain my reasons. In issue is whether the making of the military orders extinguished all native title rights and interests then subsisting on the land the subject of the special case in the sense that recognition of those rights and interests under the common law was withdrawn. For the reasons that follow, I consider that the orders did have that effect. The principles governing the withdrawal of the recognition of native title are firmly established. Native title rights and interests are extinguished by a sovereign act that is inconsistent with the continuing existence of those rights and interests152. Extinction may be brought about by rights conferred under laws of the Commonwealth Parliament or a State or Territory Parliament, or by valid executive act153. The test of inconsistency is objective: native title is extinguished by the conferral of rights that are inconsistent with continuance of the native title rights and interests regardless of whether the legislature or executive adverted to the existence of those rights and interests154 ("the inconsistency of incidents test"). Application of the test requires the court to 152 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 69 per Brennan J, 110 per Deane and Gaudron JJ; [1992] HCA 23; Western Australia v The Commonwealth (1995) 183 CLR 373 at 439 per Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ; [1995] HCA 47; Wik Peoples v Queensland (1996) 187 CLR 1 at 84-85 per Brennan CJ; [1996] HCA 40; Fejo v Northern Territory (1998) 195 CLR 96 at 126 [43] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ, 155 [112] per Kirby J; [1998] HCA 58; Yanner v Eaton (1999) 201 CLR 351 at 371-372 [35] per Gleeson CJ, Gaudron, Kirby and Hayne JJ; [1999] HCA 53; Western Australia v Ward (2002) 213 CLR 1 at 91 [82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; [2002] HCA 28; Akiba v The Commonwealth (2013) 250 CLR 209 at 240 [61] per Hayne, Kiefel and Bell JJ; [2013] HCA 33; Western Australia v Brown (2014) 88 ALJR 461 at 467 [33]; 306 ALR 168 at 175; [2014] HCA 8. 153 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 63-64 per Brennan J, 110-111 per Deane and Gaudron JJ, 195-196 per Toohey J; Wik Peoples v Queensland (1996) 187 CLR 1 at 84 per Brennan CJ. 154 Wik Peoples v Queensland (1996) 187 CLR 1 at 85 per Brennan CJ, citing Mabo v Queensland [No 2] (1992) 175 CLR 1 at 68 per Brennan J and Western Australia v The Commonwealth (1995) 183 CLR 373 at 422 per Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ. Bell identify and compare the incidents of the right granted with the native title rights that are asserted155. If continuation of the native title rights is logically inconsistent with the rights conferred or assumed by sovereign act, native title is extinguished. The grant of an estate in fee simple extinguishes native title because the holder of an estate in fee simple may use the land as he or she sees fit and may exclude any and everyone from access to the land156. Absent some reservation or qualification, the grant of an estate in fee simple is wholly inconsistent with any right of native title157. For the same reason, absent some reservation or qualification, the grant of a leasehold estate is wholly inconsistent with the continuance of native title rights and interests158. Native title rights do not "spring[] forth again" when land that has been the subject of a freehold or leasehold estate comes to be held again by the Crown159. Such is the vulnerability of native title that the grant of a lease for a term of short duration will extinguish it as effectively as the grant of an estate in fee simple. Section 5(1)(b)(i) of the NSA empowered the Governor-General to make regulations for securing the public safety and defence of the Commonwealth, and the Territories of the Commonwealth, by taking possession or control, on behalf of the Commonwealth, of any property or undertaking. Regulation 54(1) of the Regulations empowered the Minister of State for the Army ("the Minister"), in a case in which it appeared to the Minister to be necessary or expedient in the interests of the public safety, the defence of the Commonwealth or the efficient prosecution of the war or for maintaining supplies and services essential to the life of the community (collectively, "the interests of defence"), to take possession of any land on behalf of the Commonwealth and to give such directions as appeared to the Minister to be necessary or expedient in that connection. 155 Western Australia v Ward (2002) 213 CLR 1 at 89-91 [78]-[82] per Gleeson CJ, Gaudron, Gummow and Hayne JJ; Western Australia v Brown (2014) 88 ALJR 461 at 467 [33]; 306 ALR 168 at 175. 156 Fejo v Northern Territory (1998) 195 CLR 96 at 128 [47] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. 157 Fejo v Northern Territory (1998) 195 CLR 96 at 128 [47] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. 158 Western Australia v Ward (2002) 213 CLR 1 at 182 [369]-[370] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. 159 Fejo v Northern Territory (1998) 195 CLR 96 at 131 [58] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. Bell While land was in the Commonwealth's possession under reg 54(1), the land could be used for such purposes and in such manner as the Minister considered expedient in the interests of defence, notwithstanding any restriction imposed on its use by law or otherwise160. The Minister was empowered by reg 54(2)(a) so far as he considered it to be necessary or expedient in connection with the taking of possession or the use of the land to authorise persons to do anything in relation to the land which a person having an unencumbered interest in fee simple in the land would be entitled by virtue of that interest to do. The Minister was empowered by reg 54(2)(b) to prohibit or restrict the exercise of rights of way over the land, and any other rights relating to the land enjoyed by any person, whether by virtue of an interest in the land or otherwise. The Commonwealth took possession of the land under the military orders and conferred the fullest powers on an identified officer (and persons authorised by that officer) under reg 54(2)(a) and (b). For the purposes of the special case, it was accepted that at the time sovereignty was acquired over the land, the Bar-Barrum People held native title rights and interests in relation to the land. These were non-exclusive native title rights and interests including the right to access and move about on the land, to camp, hunt, fish and gather on the land and waters, to take and use natural resources from the land and waters, to conduct ceremonies, to maintain places of significance under the traditional laws and customs of the Bar-Barrum People and to protect those places from physical harm, to teach the physical and spiritual attributes of the land, to hold meetings and to be buried on the land. How is it suggested that the Bar-Barrum People's native title rights and interests, all of which depended upon access to the land, survived the making of the military orders by which the Commonwealth took possession of the land? Each of the members of the Full Court of the Federal Court of Australia (North, Logan and Jagot JJ) accepted that the right taken by the Commonwealth under the military orders was a right of exclusive possession of the land161. The majority, North and Jagot JJ, distinguished the Commonwealth's right of exclusive possession from the right of exclusive possession that is conferred by the grant of an estate in the land162. Their Honours took into account that the Commonwealth's statutory right was assumed for a limited purpose and was of limited duration under a regulatory scheme which recognised the continuation of 160 Regulations, reg 54(2). 161 Congoo v Queensland (2014) 218 FCR 358 at 375-376 [52] per North and Jagot JJ, 391 [112], 392 [115] per Logan J. 162 Congoo v Queensland (2014) 218 FCR 358 at 375-376 [52]. Bell existing rights and interests in the land163. The latter recognition was evident in the requirement of reg 54(3) that the owner or occupier of the land supply information relating to the land164. It was also evident in the provision in reg 60D for compensation the Commonwealth's exercise of its rights under reg 54165. loss or damage occasioned by the case of It was not necessary to the Full Court majority's analysis to compare the incidents attaching to the Commonwealth's right of possession with the incidents of the native title rights and interests claimed by the Bar-Barrum People. Their Honours characterised the inconsistency of incidents test as an analytical tool that assists the court to ascertain objective legislative intention166. Their Honours identified the requisite intention as an intention that native title rights are no longer recognised by the common law167. They rejected the proposition that applying the inconsistency of incidents test might produce a different result to ascertainment of legislative intention because "rights granted or asserted by the Crown cannot rise above their statutory source"168. By way of illustration, their Honours pointed out that the grant of an estate conferring exclusive possession by the Crown as radical title holder evinces the intention to extinguish native title because the grant of exclusive possession is inconsistent with the continued recognition of native title; whereas here, the Commonwealth did not hold the radical title to the land and was "indifferent to the nature and extent of pre-existing interests" in it169. Their Honours concluded that the Commonwealth had taken to itself a right of possession, prohibiting others from exercising their rights in relation to the land, in circumstances in which the regulatory scheme recognised underlying rights and interests170: in the circumstances, the Commonwealth was not to be imputed with an objective intention to extinguish native title rights and interests171. 163 Congoo v Queensland (2014) 218 FCR 358 at 376 [53]. 164 Congoo v Queensland (2014) 218 FCR 358 at 368 [27]. 165 Congoo v Queensland (2014) 218 FCR 358 at 369 [27]. 166 Congoo v Queensland (2014) 218 FCR 358 at 375 [50]. 167 Congoo v Queensland (2014) 218 FCR 358 at 375 [50]. 168 Congoo v Queensland (2014) 218 FCR 358 at 375 [50]. 169 Congoo v Queensland (2014) 218 FCR 358 at 375 [51]. 170 Congoo v Queensland (2014) 218 FCR 358 at 375 [51]. 171 Congoo v Queensland (2014) 218 FCR 358 at 375 [52]. Bell The Full Court majority's analysis cannot stand with authority, predicated as it is upon the view that extinguishment of rights conferred by or under statute turns upon the existence of an objective legislative intention to effect extinguishment. The joint reasons in Western Australia v Ward caution that the need to demonstrate a "clear and plain intention" that native title is extinguished is apt to mislead172. In the case of rights granted by or under statute, consideration of legislative intention is directed to the nature and content of the right. The test for extinguishment under common law does not depend upon identification of an ahistorical legislative intention to extinguish rights which before 1992 were not understood to have survived European settlement173. As Gleeson CJ put it in Wilson v Anderson, extinguishment of native title arises from the inconsistency in the incidents of the two sets of rights and not from the existence of a purpose of abrogating native title rights or interests174. That the test for extinguishment is as stated in the joint reasons in Ward was most recently affirmed by the Court in Western Australia v Brown175. The Bar-Barrum People and the Commonwealth rely on the same features of the regulatory scheme as were identified by the Full Court majority: possession was assumed for a limited purpose, and was of limited duration, under a scheme which recognised the continuation of existing rights and interests in the land. The Bar-Barrum People and the Commonwealth seek to rely on these features not for ascertainment of legislative intention but because they are said to define the nature of the right that the Commonwealth took. The Bar-Barrum People and the Commonwealth acknowledge that on the day the Commonwealth took possession of the land it assumed the right to refuse access to the land to all persons, including those having an interest in the land. Each distinguishes the Commonwealth's right of possession under the military orders from the possession conferred on the holder of an estate in fee simple by reason of the purpose of the possession. They argue that the Commonwealth's right did not permit it to exclude persons from the land "for any reason or no 172 (2002) 213 CLR 1 at 89 [78] per Gleeson CJ, Gaudron, Gummow and Hayne JJ. See also Akiba v The Commonwealth (2013) 250 CLR 209 at 240 [62] per Hayne, 173 Wik Peoples v Queensland (1996) 187 CLR 1 at 184-185 per Gummow J; Akiba v The Commonwealth (2013) 250 CLR 209 at 229-230 [31] per French CJ and 174 (2002) 213 CLR 401 at 417 [6]; [2002] HCA 29. 175 (2014) 88 ALJR 461 at 467 [33]; 306 ALR 168 at 175. Bell reason". The submission evokes the statement in Brown with respect to the mineral leases that were there under consideration176. In Brown, the grant under each "mineral lease" was expressed to be subject to the terms, covenants and conditions set out in the agreement between Western Australia and the joint venturers177. This agreement required the joint venturers to allow Western Australia and third parties access to the land covered by the mineral leases provided that access did not unduly prejudice or interfere with the joint venturers' operations178. The provision precluded construing the mineral leases as providing a right of exclusive possession179. The rights under the mineral leases were not relevantly different from the rights under the pastoral leases considered in Wik Peoples v Queensland180. The capacity for the non-exclusive native title rights and interests of the Ngarla People to co-exist with the rights conferred on the joint venturers under the mineral leases in Brown was demonstrated by consideration of the position that would have obtained on the day following the grant of the first mineral lease: on that day the Ngarla People could have exercised all of the rights that were the subject of their native title claim anywhere on the land without breach of any right granted to the joint What rights were assumed by the Commonwealth under the military orders? Each conferred rights on the Commonwealth to the full extent of the powers provided by reg 54. As earlier noted, reg 54 was made pursuant to s 5(1)(b)(i) of the NSA, which authorised the making of regulations for "the taking of possession or control, on behalf of the Commonwealth, of any property or undertaking". "Possession" was not defined in the NSA or the Regulations. In Minister of State for the Army v Dalziel182, possession was treated as having its general law meaning in the law of property. Possession consists of an element of 176 (2014) 88 ALJR 461 at 469 [46]; 306 ALR 168 at 177. 177 (2014) 88 ALJR 461 at 465 [13]; 306 ALR 168 at 171. 178 Western Australia v Brown (2014) 88 ALJR 461 at 464 [8]; 306 ALR 168 at 170. 179 Western Australia v Brown (2014) 88 ALJR 461 at 469 [46]; 306 ALR 168 at 178. 180 (1996) 187 CLR 1. See Western Australia v Brown (2014) 88 ALJR 461 at 471 [57]; 306 ALR 168 at 179. See also Mabo v Queensland [No 2] (1992) 175 CLR 1 at 69 per Brennan J. 181 (2014) 88 ALJR 461 at 471 [57]; 306 ALR 168 at 180. 182 (1944) 68 CLR 261; [1944] HCA 4. Bell control over, and the intention to possess, that which is possessed183. Possession of land exists where a person is in a position to "control access to [land] by others and, in general, decide how the land will be used"184. By its nature, the concept of possession carries with it the ability to exclude others: "Exclusivity is of the essence of possession."185 It follows, as McHugh J has observed, that the adjective "exclusive" does not add to an understanding of the concept of possession in law because possession that is not exclusive is a contradiction in terms186. In Dalziel, Williams J characterised the right taken by the Commonwealth under a military order (in relevantly the same terms as the military orders with which this appeal is concerned) as giving the Commonwealth, for an indefinite period, an exclusive right to possess the land against the whole world, including against persons rightfully entitled to the possession of the land at common law187. This description of the nature of the Commonwealth's right is consistent with the statements of the other Justices who formed the majority in concluding that it was a right of property and within the reach of s 51(xxxi) of the Constitution188. On 20 December 1943, by an order ("the first military order") made pursuant to reg 54(1) under an instrument of delegation, Francis Roger North, Colonel, did "HEREBY on behalf of the Commonwealth, TAKE POSSESSION of the [land described in the Schedule to this order]". By the same order, under reg 54(1), Francis Roger North, Colonel, directed in connection with the taking of possession of the land that personnel were to occupy the land using as far as 183 J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419 at 445 [70] per Lord Hope of Craighead; Lightwood, A Treatise on Possession of Land, (1894) at 9-20; Holmes, The Common Law, (1882) at 216; Pollock and Wright, An Essay on Possession in the Common Law, (1888) at 11-14, 28-36. 184 Western Australia v Ward (2002) 213 CLR 1 at 82 [52] per Gleeson CJ, Gaudron, 185 J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419 at 445 [70]. 186 Western Australia v Ward (2002) 213 CLR 1 at 214-215 [477], 223 [502]-[503]. See also Clement v Jones (1909) 8 CLR 133 at 139 per Griffith CJ; [1909] HCA 11; Georgeski v Owners Corporation SP49833 (2004) 62 NSWLR 534 at 547 [41]; Hill, "The Proprietary Character of Possession", in Cooke (ed), Modern Studies in Property Law, Volume 1: Property 2000, (2001) 21 at 26-27. 187 (1944) 68 CLR 261 at 299. 188 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 286 per Rich J, 290 per Starke J, 295 per McTiernan J. Bell was practicable existing means of access and that all personal property on the land was to be removed. By the same order, pursuant to reg 54(2)(a), Francis Roger North, Colonel, authorised the persons occupying the land to do in relation to the land anything which any person having an unencumbered interest in the land would be entitled to do by virtue of that interest and, pursuant to reg 54(2)(b), directed that no person should exercise any right of way over the land or any other right relating to the land whether by way of an interest in land or otherwise. The reg 54(2)(a) direction served, among other things, to permit the removal of structures from the land or the erection of structures upon it. The reg 54(2)(b) direction denied the holders of any incorporeal hereditaments the exercise of their rights while the Commonwealth remained in possession of the land189. The Commonwealth submits that it did not take possession of the land by the making of the first military order and that some further manifestation of the intention to possess was required. It submits that a party wishing to establish extinguishment of native title rights and interests must prove not just the making of a military order under reg 54 but also that "possession was taken in pursuance of such a direction under reg 54(1)". It is unnecessary to address the Commonwealth's some manifestation of intention required in addition to the intention manifest by the making of the order, that intention is plainly supplied on the facts of the special case. At about the time the first military order was made, the Commonwealth physically occupied at least some of the land. The Commonwealth used the land as an artillery range and a live fire manoeuvre range for training infantry and armoured units. in which, were in circumstances submission The Commonwealth was in possession of the whole of the land identified in the Schedule to the first military order on and from 20 December 1943. Each succeeding order cancelled any previous order so far as it affected the land. The second order did not cover all of the land covered by the first and to that extent it would seem the first order remained in force. The last three orders covered all the land covered by the second order together with additional land. The Commonwealth ceased to occupy any part of the land on or about 31 August The Bar-Barrum People's native title rights and interests based upon their traditional laws and customs were not rights of the kind to which the direction under reg 54(2)(b) was directed. The logical inconsistency between the Bar-Barrum People's native title rights and interests and those of the Commonwealth was the Commonwealth's right of possession under reg 54(1). The fact that the right was conferred under the authority of a legislative 189 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 301 per Williams J. Bell instrument and not as an incident of the grant of an estate in the land does not alter relevantly the nature of the possession that the Commonwealth took. The Bar-Barrum People's and the Commonwealth's submissions, which dispute that the Commonwealth's possession of the land was a right to exclude persons from it for any reason or no reason, conflate the condition for the exercise of the power under reg 54(1) with the right of possession which valid exercise of the power conferred. The delegate was satisfied that possession of the land was necessary or expedient in the interests of defence. That being so, the delegate took possession of the land on behalf of the Commonwealth and thereby assumed the right to exclude the whole world from it. The Bar-Barrum People's and the Commonwealth's submissions which seek to qualify the Commonwealth's right of possession by reference to its limited, if indefinite, duration and the provision for compensation for loss and damage occasioned by its exercise must be rejected. Inconsistency in the incidents of the two sets of rights is to be determined as a matter of law at the date the Commonwealth took the right. The logical inconsistency between the two sets of rights is demonstrated by considering the position which would have obtained on the day following the making of the first military order190. On that day, the Bar-Barrum People could not in law have exercised any of the native title rights and interests that are the subject of their claim. The Commonwealth proposes that common law recognition of native title is not so infirm that it cannot conceive of "a distinction between the tree and the fruit". This is in aid of the submission that the Commonwealth took its right of possession upon the footing that native title rights and interests, along with all other interests in the land, were subsisting during the interval of the war and that money compensation was substituted for the ability to exercise the rights. Conceptually, the argument confronts the same difficulty as the contention that native title is suspended during an interval created by the conferral of a freehold estate. That contention was rejected in Fejo v Northern Territory. In their joint reasons in that case, Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ observed that it is an argument that seeks to convert the fact of continued connection with the land into a right to maintain that connection191. Settled authority, which no party in this appeal seeks to challenge, is against acceptance that the Bar-Barrum People's native title rights and interests survived the Commonwealth's possession of the land taken under temporary war-time powers. 190 See Western Australia v Brown (2014) 88 ALJR 461 at 471 [57]; 306 ALR 168 at 191 (1998) 195 CLR 96 at 128 [46]. Bell The appeal should be allowed and orders made in the terms proposed by 155 The ultimate issue in the appeal is whether the rights and interests possessed by the Bar-Barrum people under their traditional laws and customs "are recognised by the common law of Australia" within the meaning of s 223(1)(c) of the Native Title Act 1993 (Cth). The common law "recognises" native title rights and interests in the sense that "by the ordinary processes of law and equity, [it will] give remedies in support of the relevant rights and interests to those who hold them"192. Native title rights and interests once but no longer so recognised by the common law are said to be "extinguished"193. It must now be treated as settled that the common law ceases to recognise a native title right at the point in time of the creation of an "inconsistent" right by or pursuant to legislation194. The common law test is one of "logical antinomy" of rights195. The test involves asking whether the existence of the right created by or pursuant to legislation necessarily implies the non-existence of the native title right196. The test is not adequately captured merely by asking whether the two rights could be exercised concurrently197. The test is more appropriately captured by asking whether the existence of the right created by or pursuant to legislation is "inconsistent with the native title holders continuing to hold any of the rights or interests which together make up native title"198. There is no reason in principle why the common law should adopt any different approach when it comes to consideration of the effect of legislation imposing a prohibition on the continued recognition of native title rights. The only question should be whether a particular prohibition is necessarily inconsistent with the continued existence of a particular native title right. That 192 The Commonwealth v Yarmirr (2001) 208 CLR 1 at 49 [42]; [2001] HCA 56. 193 Akiba v The Commonwealth (2013) 250 CLR 209 at 219-220 [10]; [2013] HCA 33. 194 Fejo v Northern Territory (1998) 195 CLR 96 at 131 [58]; [1998] HCA 58. 195 Western Australia v Brown (2014) 88 ALJR 461 at 468 [38]; 306 ALR 168 at 176; [2014] HCA 8. 196 Western Australia v Brown (2014) 88 ALJR 461 at 471 [56]; 306 ALR 168 at 179. 197 Western Australia v Brown (2014) 88 ALJR 461 at 470 [50]-[53]; 306 ALR 168 at 198 Fejo v Northern Territory (1998) 195 CLR 96 at 126 [43] (emphasis added). See also Yanner v Eaton (1999) 201 CLR 351 at 371-372 [35]; [1999] HCA 53. would not ordinarily be so in the case of a prohibition of the exercise of the native title right which is partial, temporary or conditional199. The statement in Western Australia v The Commonwealth (Native Title Act Case)200 that, at common law, "native title can be extinguished or impaired by a valid exercise of sovereign power inconsistent with the continued enjoyment or unimpaired enjoyment of native title" must be understood in light of the footnoted reference to the reasons for judgment of Brennan J in Mabo v Queensland [No 2]201. Having explained (as he later summarised it) that "[t]he rights and privileges conferred by native title were unaffected by the Crown's acquisition of radical title but the acquisition of sovereignty exposed native title to extinguishment by a valid exercise of sovereign power inconsistent with the continued right to enjoy native title"202, his Honour said (in the passage referenced in the Native Title Act Case) that "[a] clear and plain intention to extinguish native title is not revealed by a law which merely regulates the enjoyment of native title or which creates a regime of control that is consistent with the continued enjoyment of native title"203. There are many references in the native title case law to the need to discern a "clear and plain intention" to extinguish native title in a valid exercise of sovereign power in order to conclude that native title has been extinguished at common law. They are to be understood as directed to the judicial determination of the scope of legal change wrought by an exercise of sovereign power – relevantly, for present purposes, to the judicial determination of the incidents of a legislatively conferred right or of the ambit of a legislatively imposed prohibition. So understood, they have, as French CJ and Keane J put it in the present case, "normative force"204: they inform constructional choice. They are 199 Akiba v The Commonwealth (2013) 250 CLR 209 at 229 [29]; Karpany v Dietman (2013) 88 ALJR 90 at 94-96 [18]-[27]; 303 ALR 216 at 221-223; [2013] HCA 47. 200 (1995) 183 CLR 373 at 439; [1995] HCA 47. 201 (1992) 175 CLR 1 at 64; [1992] HCA 23. See (1995) 183 CLR 373 at 439 footnote 202 (1992) 175 CLR 1 at 69. See (1992) 175 CLR 1 at 58-64. 203 (1992) 175 CLR 1 at 64 (footnotes omitted). not inherently in tension with the common law test being one of "logical antinomy" of rights205. To the contrary, they inform one aspect of its application. In my opinion, nothing in the regime of control created by reg 54 of the National Security (General) Regulations 1939 (Cth) was inconsistent with the continued existence of native title rights (or of any other rights) in connection with the land in respect of which the Minister, on behalf of the Commonwealth, took "possession" under reg 54(1) and, "by order" under reg 54(2)(b), made provision "prohibiting or restricting the exercise of … rights relating thereto which are enjoyed by any person". The word "possession", standing alone, connotes a high degree of intentional control over the thing possessed, but the word has never acquired a more definite connotation in law or in ordinary speech206. There is, in my opinion, no reason to equate "possession" in reg 54(1) with "exclusive possession" ("the right to exclude any and everyone from any and all parts of the land for any reason or no reason"207). The regulation did not say "exclusive possession". Minister of State for the Army v Dalziel208 does not support reading "possession" to mean "exclusive possession". Minister for Interior v Brisbane Amateur Turf Club209, holding that a lease could be granted for a term which commenced while the Commonwealth remained in possession under the regulation, is against it. Dalziel is relevantly authority for the proposition that, by taking "possession" under reg 54(1), the Commonwealth obtained a "qualified right to possess ... in the nature of property which [was] valid against everyone who [could not] show a prior and better right"210. The nature and extent of the qualified right of possession under reg 54(1) was necessarily dependent on the statutory incidents which reg 54(2) attached to that possession. 205 Western Australia v Ward (2002) 213 CLR 1 at 89 [78]; [2002] HCA 28, referring to Wik Peoples v Queensland (1996) 187 CLR 1 at 168-169; [1996] HCA 40; Wilson v Anderson (2002) 213 CLR 401 at 416-419 [4]-[10]; [2002] HCA 29. 206 See Douglas, "Is Possession Factual or Legal?", in Descheemaeker (ed), The Consequences of Possession, (2014) 56. 207 Western Australia v Brown (2014) 88 ALJR 461 at 471 [57]; 306 ALR 168 at 179. 208 (1944) 68 CLR 261; [1944] HCA 4. 209 (1949) 80 CLR 123; [1949] HCA 31. 210 (1944) 68 CLR 261 at 285, quoting Pollock and Wright, An Essay on Possession in the Common Law, (1888) at 93. Accordingly, as Starke J put it in Dalziel211: "Nothing is gained by comparing the right given by reg 54 to the Commonwealth with various estates or interests in land of limited duration or with rights over the land of another recognized by the law, for it is a right created by a statutory regulation and dependent upon that regulation for its operation and its effect." The first of the statutory incidents which reg 54(2) attached to possession of land under reg 54(1), set out in the introductory words of reg 54(2), was a power to "use" any (but not necessarily all) of the land "for such purpose, and in such manner, as [the Minister] thinks expedient in the interests of the public safety or the defence of the Commonwealth". The second, set out in reg 54(2)(a), was a power (similarly limited as to purpose) to do, or authorise the doing of, in relation to the land, "anything which any person having an unencumbered interest in fee simple in the land would be entitled to do by virtue of that interest". The third was that set out in reg 54(2)(b). The language of reg 54(2)(a) constructed a legal fiction and ought not in principle be construed as having had a legal operation beyond that required to achieve the object of its inclusion212. To the extent that reg 54(2)(a) allowed the Minister to exclude other persons from the land, it ought not be read as having allowed for the exclusion of persons who had pre-existing rights to be on the land. Those persons were to be excluded, if at all, by the making of an order of prohibition or restriction under reg 54(2)(b)213. That construction of reg 54(2)(b), as providing the sole source of power to exclude persons having pre-existing rights to be on the land, is significant in two respects. One is that, by the terms in which it was expressed as well as by the nature of the power it conferred, reg 54(2)(b) expressly acknowledged the continuing existence of all such pre-existing rights irrespective of the source of those rights. The other is that the most that reg 54(2)(b) permitted to happen by order was prohibition of the exercise of those rights for the inherently temporary period which defined the maximum life of the regulations: "not longer than six months after His Majesty ceases to be engaged in war"214. The existence of that 211 (1944) 68 CLR 261 at 290. 212 Wellington Capital Ltd v Australian Securities and Investments Commission (2014) 89 ALJR 24 at 37 [51]; 314 ALR 211 at 227; [2014] HCA 43. 213 Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 7; [1932] HCA 9. 214 National Security Act 1940 (Cth), s 9. prohibition was logically consistent with (indeed it was premised on) the continued existence of the rights the exercise of which was temporarily prohibited. If I were to interpret reg 54 as having conferred a right on the Commonwealth (under reg 54(1)) or a power on the Minister (under reg 54(2)(a)) to exclude persons who had pre-existing rights to be on the land, I would still not hold the regime of control created by reg 54 to have extinguished the rights and interests possessed by the Bar-Barrum people under their traditional laws and customs. In those circumstances, I would agree with the reasoning in the antepenultimate paragraph of the reasons for judgment of French CJ and The right of the Commonwealth or power of the Minister to exclude persons who had pre-existing rights to be on the land, on that alternative interpretation of reg 54, would still not have been to exclude anyone from any or all of the land for any purpose. It would at most have been a limited purposive right or power to exclude, relevantly indistinguishable from those conferred on the lessees of the mining leases whose "exclusive possession" for mining purposes was held not to extinguish native title rights in Western Australia v Ward216. That holding illustrates the proposition that a right or power conferred for a statutory purpose, to be exercised for that purpose, is not inconsistent with native title holders continuing to hold rights or interests under their traditional laws and customs which remain recognised by the common law merely because an exercise of that right or power might prevent native title holders from exercising or enjoying those rights or interests217. For these reasons, I agree with French CJ and Keane J that the appeal should be dismissed with costs. 216 (2002) 213 CLR 1 at 165-166 [307]-[308], 172 [326], 174 [331]. 217 See also Western Australia v Brown (2014) 88 ALJR 461 at 464 [8], 468 [36], 469 [46], 471 [55]-[57], 472 [63]; 306 ALR 168 at 170, 175-181.
HIGH COURT OF AUSTRALIA CASTLE CONSTRUCTIONS PTY LIMITED APPELLANT AND SAHAB HOLDINGS PTY LTD & ANOR RESPONDENTS Castle Constructions Pty Limited v Sahab Holdings Pty Ltd [2013] HCA 11 10 April 2013 ORDER Appeal allowed. Application for special leave to cross-appeal refused. The first respondent pay the appellant and the second respondent the costs of the appeal and of the application for special leave to cross- appeal. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 5 April 2012 and, in their place, order that the appeal to that Court be dismissed with costs. On appeal from the Supreme Court of New South Wales Representation M L D Einfield QC with J Horowitz for the appellant (instructed by Domain Legal Pty Limited) G K Burton SC for the first respondent (instructed by Kanjian & Company) P B Walsh with L Walsh for the second respondent (instructed by Land and Property Information) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Castle Constructions Pty Limited v Sahab Holdings Pty Ltd Real property – Torrens system land – Easements – Registered proprietor of servient tenement requested Registrar-General remove easement from Register – Easement removed from Register without objection from registered proprietors of dominant tenement – Subsequent purchaser of dominant tenement requested that Registrar-General restore easement to Register – Registrar-General refused – Whether deliberate removal of easement from Register "omission" within meaning of s 42(1)(a1) of Real Property Act 1900 (NSW) ("Act") – Whether subsequent purchaser of dominant tenement barred from action against Registrar- General under s 12A(3) of Act for removal of easement – Whether subsequent purchaser "person who is dissatisfied" with Registrar-General's decision under s 122 of Act. Words and phrases – "in the case of the omission", "omission", "person who is dissatisfied". Real Property Act 1900 (NSW), ss 12(1)(d), 12A, 32(6), 41, 42(1), 42(1)(a1), HAYNE, CRENNAN, KIEFEL AND BELL JJ. This appeal concerns two pieces of land in Northbridge, Sydney. The rear boundary of the piece known as 69 Strathallen Avenue ("the Strathallen land") abuts part of the western boundary of the other piece, known as 134 Sailors Bay Road ("the Sailors Bay land"). Each piece of land is, and at all times relevant to these proceedings was, subject to the provisions of the Real Property Act 1900 (NSW) ("the RPA"). Although many issues were touched on in argument in this Court, the determinative issue in the appeal can be stated briefly. The RPA provides1 that a registered proprietor holds the estate or interest in land recorded in a folio of the Register subject only to other estates and interests recorded in that folio. An exception2 is "in the case of the omission" of an easement validly created under the RPA. After giving notice to the then dominant tenement holders, and without objection, the Registrar-General removed an easement from the folios of both the dominant and the servient tenements in exercise of a power under the RPA. The current dominant tenement holder now says that the Registrar-General erred. Is this "the case of the omission" of an easement? These reasons will show that this was not such a case. There was no "omission" of the easement. Facts and course of proceedings In 1921, the Strathallen land and the Sailors Bay land each formed part of a larger piece of land owned by Mr and Mrs Middleton. In that year, the Middletons sold the Strathallen land to Mr Davis. The instrument of transfer ("the 1921 transfer") created an easement of way over the western boundary of the land the Middletons retained in favour of the land they sold. The easement provided access from Sailors Bay Road to the rear of the land the Middletons sold. The 1921 transfer also included some covenants about the fencing of the boundary between the land sold and the land retained, the use of the easement and the use of the land that was sold. In 1958, part of the land retained by the Middletons was subdivided and, as a result, the covenants and the easement burdened the land which became known as 134 Sailors Bay Road. In June 2001, the appellant (Castle Constructions Pty Limited – "Castle") the In September 2001, Castle asked the Sailors Bay land. bought s 42(1)(a1). Registrar-General to remove the easement over its land from the Register maintained3 for the purposes of the RPA. A statutory declaration was filed in support of the application, which asserted that the easement, according to its terms, subsisted only for so long as Mr Davis (or his successors other than on sale) owned the Strathallen land. As will later appear, the correctness of this assertion is disputed but need not be decided. The Registrar-General notified the then owners of the Strathallen land, Mr and Mrs Howard, that he intended to remove the easement from the Register. They did not object to this proposed course of action and, in November 2001, the Registrar-General removed the easement from the folios of the Register relating to the Sailors Bay land (which had been the servient tenement) and the Strathallen land (which had been the dominant tenement). restore In April 2007, well after the Registrar-General had taken these steps, the first respondent (Sahab Holdings Pty Ltd – "Sahab") became the registered proprietor of the Strathallen land. In September 2008, Sahab asked the the the easement Registrar-General Registrar-General refused to do so. Sahab brought proceedings in the Supreme Court of New South Wales against the Registrar-General seeking a declaration that the easement had been wrongly extinguished and an order requiring the Registrar-General to restore the easement to the Register. On its application, Castle was joined as a party to those proceedings. In October 2009, the primary judge (Slattery J) decided4 that the Registrar-General was bound to give Sahab reasons for the 2001 decision to remove the easement from the Register and ordered the Registrar-General to do so. the Register but In accordance with these orders, the Registrar-General provided to Sahab a copy of the Registrar-General's minute papers relating to the removal of the easement. Those minute papers relevantly recorded5 "[n]o objection received to the applications. Applications granted." The letter from the Registrar-General which enclosed the copy minute papers said that: "For the sake of further clarity I advise that 'objection' referred to any objection to the Registrar General's notice of 8 October 2001 to the s 31B(1). 4 Sahab Holdings Pty Ltd v Registrar-General (2009) 75 NSWLR 629. 5 The minute papers also set out some identifying folio numbers and like details. owners of the dominant tenement giving them notice of intention to cancel the recording of the easement and restrictive covenant. The notice was sent because the Registrar General agreed with the applicant of Request 7924028, that the easement and covenant had expired by virtue of its own terms." On 8 March 2010, Slattery J published6 reasons for decision holding that Sahab was not entitled to the orders which it had sought to compel the Registrar-General to restore the easement to the Register. On 5 May 2010, Slattery J made7 final orders dismissing Sahab's claim. Sahab appealed to the Court of Appeal. The Court of Appeal (McColl and Campbell JJA and Tobias AJA) determined8 that Sahab's appeal should be allowed. Castle applied to have the Court of Appeal withdraw or reconsider its reasons but the Court dismissed9 that application and subsequently made orders10 requiring the Registrar-General to restore the easement to the Register. By special leave, Castle appealed to this Court against the Court of Appeal's final orders. Sahab sought special leave to cross-appeal to allege that, contrary to the conclusion reached by the Court of Appeal11, the easement was no longer subject to the covenants affecting the easement that had been set out in the 1921 transfer. Issues As noted at the outset of these reasons, the determinative issue in the appeal is whether Castle's title to the Sailors Bay land is subject to the easement which the Registrar-General intentionally removed from the Register. The answer to this issue turns upon s 42(1)(a1) of the RPA. Section 42(1) provided 6 Sahab Holdings Pty Ltd v Registrar-General (No 2) (2010) 14 BPR 27,459. 7 Sahab Holdings Pty Ltd v Registrar-General [No 3] [2010] NSWSC 403. 8 Sahab Holdings Pty Ltd v Registrar-General (2011) 15 BPR 29,627. 9 Sahab Holdings Pty Ltd v Registrar-General (No 2) (2012) 16 BPR 30,353. 10 Sahab Holdings Pty Ltd v Registrar-General (No 3) (2012) 16 BPR 30,353. 11 (2011) 15 BPR 29,627 at 29,648 [75]-[78]. that, except in the case of fraud, the registered proprietor holds the "estate or interest in land recorded in a folio of the Register" subject to such other estates and interests recorded in that folio "but absolutely free from all other estates and interests that are not so recorded except" in five listed circumstances. One listed circumstance, in s 42(1)(a1), was "in the case of the omission ... of an easement ... validly created at or after [the time the land was brought under the provisions of the RPA] under this or any other Act or a Commonwealth Act". Sahab submitted that "omission" means no more than is "not there". It was said that this meaning accords with both ordinary English usage and the Court of Appeal's previous decision in Dobbie v Davidson12. It followed, so it was submitted, that this was a "case of the omission ... of an easement" because the easement Sahab claimed is not recorded on the Register. The parties sought to agitate many other questions about the construction and application of several provisions of the RPA. Argument traversed the operation of (and in some instances the interaction between) s 12(1)(d) (which gave power to the Registrar-General to correct errors or omissions in the Register), s 12A(3) (which provided that no action by certain persons lies against the Registrar-General for taking action that alters the Register), s 122 (which provided for review of certain decisions of the Registrar-General by the Supreme Court), s 136 (which gave power to the Registrar-General to require persons to deliver up a certificate of title for correction) and s 138 (which provided for a court to order the Registrar-General to amend a folio of the Register). Sahab submitted that some or all of ss 12, 122, 136 and 138 of the RPA permitted it to challenge the Registrar-General's decision to remove an easement and to obtain restoration of that easement. In particular, Sahab submitted that if it showed that the Registrar-General should not have removed the easement from the Register, there was an "error" or "omission" (within the meaning of s 12(1)(d)) which entitled Sahab to relief under one or other of ss 122 and 138 and that there was accordingly13 a "case of the omission ... of an easement" within s 42(1)(a1). Sahab did not dispute that, on this understanding of the RPA, a registered proprietor could only be confident of having an indefeasible title when any statutory mechanisms to review the Registrar-General's decision to alter the Register had been exhausted in favour of the Registrar-General. 12 (1991) 23 NSWLR 625. 13 cf Registrar of Titles (WA) v Franzon (1975) 132 CLR 611 at 618 per Mason J; [1975] HCA 41. Indefeasibility of title would be contingent upon the exhaustion of these review mechanisms. The Court of Appeal In the Court of Appeal, the joint reasons of Campbell JA and Tobias AJA (with which McColl JA agreed) identified the first question as being14 "the appropriate construction of the grant of the right of way and the attendant covenants to determine whether the grant continued in operation". They concluded15 that "[t]he correct view ... is that the right of way was subsisting at the time of the 2001 decision" to remove the easement from the Register. That conclusion depended, at least in part, upon the Court of Appeal's preferred construction16 of the 1921 transfer, which set out the terms of the easement and attendant covenants. It is not necessary to examine these questions of construction. For present purposes, it is enough to notice that the Court of Appeal found17 that the grant of the easement and the operation of the attendant covenants were permanent whereas the statutory declaration which Castle had submitted to the Registrar-General in support of its application for removal of the easement had asserted that they subsisted only for so long as Mr Davis (or his successors other than on sale) owned the Strathallen land. The Court of Appeal then examined in detail the operation of s 12 of the RPA (which Sahab submitted allowed the Registrar-General to reverse the decision to remove the easement) and ss 122, 136 and 138 (which Sahab submitted allowed the Court to grant the relief it sought). Only after considering these questions of remedial powers did the Court of Appeal turn to consider questions of indefeasibility and the operation of s 42(1). The Court of Appeal held18 that the easement had "been omitted within the meaning of s 42(1)(a1)" because "omission" in that provision (and s 12(1)(d)) meant no more than that the easement was "not there". As was said19 in the joint 14 (2011) 15 BPR 29,627 at 29,633 [5(1)]. 15 (2011) 15 BPR 29,627 at 29,677 [224]. 16 (2011) 15 BPR 29,627 at 29,648 [75]. 17 (2011) 15 BPR 29,627 at 29,648 [78]. 18 (2011) 15 BPR 29,627 at 29,684 [274]. 19 (2011) 15 BPR 29,627 at 29,683 [267]. reasons, "if one looks at the register and the easement is not there but should be, it follows that it has been omitted. The reason for its omission or why it is 'not there' is irrelevant." That omitted means no more than "not there" was held20 to have been established by the Court of Appeal's previous decision in Dobbie21. And it followed from the fact of omission, so the Court of Appeal held22, that "the Registrar-General was empowered to correct that omission in 2008 when requested [by Sahab] to do so". The correct starting point The Court of Appeal began by asking whether the easement, and its attendant covenants, "continued in operation" and concluded that, on its proper construction, the 1921 transfer had created rights and obligations which were not limited in the manner which Castle had asserted when it sought removal of the easement from the Register. But both the question and the answer were directed to what interest in land the 1921 transfer would have given under general real property principles. Neither the question nor the answer was directed to the separate, and only relevant, inquiry: what interests in land did the RPA give to Castle and Sahab? That inquiry must begin by examining s 42(1)(a1) and deciding what is an "omission" of an easement and that examination must be made against the background of some basic principles. Basic principles It is of fundamental importance to recognise that the Torrens system of registered title, of which the RPA is a form, "is not a system of registration of title but a system of title by registration"23. "Together with the information appearing on the relevant folio, the registration of dealings manifests the scheme 20 (2011) 15 BPR 29,627 at 29,681-29,683 [254]-[268]. 21 (1991) 23 NSWLR 625. 22 (2011) 15 BPR 29,627 at 29,684 [274]. 23 Breskvar v Wall (1971) 126 CLR 376 at 385 per Barwick CJ; [1971] HCA 70. See also Halloran v Minister Administering National Parks and Wildlife Act 1974 (2006) 229 CLR 545 at 559-560 [35]; [2006] HCA 3; Black v Garnock (2007) 230 CLR 438 at 443 [10]; [2007] HCA 31; Westfield Management Ltd v Perpetual Trustee Co Ltd (2007) 233 CLR 528 at 531 [5], 539 [38]; [2007] HCA 45. of the Torrens system to provide third parties with the information necessary to comprehend the extent or state of the registered title to the land in question."24 The easement and attendant covenants at issue in these proceedings were created by the registration of the 1921 transfer from the Middletons to Mr Davis. Until registered, the 1921 transfer was not "effectual to pass any estate or interest in any land" under the provisions of the RPA25. Upon registration of the instrument of transfer, "the estate or interest specified in such instrument" passed and the land became "subject to the covenants, conditions, and contingencies set forth and specified in such instrument"26. In its then form, s 47 obliged the Registrar-General to "enter a memorial of the instrument creating such easement or incorporeal right upon the folium of the register-book, constituted by the existing grant or certificate of title" of the land benefited by the easement. "Omission" of an easement No doubt it is important to recognise that the primary definition of "omission" is27 "[t]he action of omitting or leaving out, or fact of being omitted; failure or forbearance to insert or include; also, an instance of this" and that the primary definition of "omit" is28 "[t]o leave out, not to insert or include". Each definition directs attention only to the action described; neither directs attention to how or why the action of omitting or leaving out occurred. As the reasons of Priestley JA in Dobbie demonstrate29, the history of Torrens title legislation and the treatment of cases of "omission" of unregistered easements point to reading "omission", in the collocation "case of the omission or misdescription of an easement", as according with these dictionary definitions 24 Westfield Management (2007) 233 CLR 528 at 531 [5]. 27 The Oxford English Dictionary, 2nd ed (1989), vol X at 786, "omission", meaning 1. 28 The Oxford English Dictionary, 2nd ed (1989), vol X at 786, "omit", meaning 1. 29 (1991) 23 NSWLR 625 at 647-660. and meaning30 no more than "left out" or "not there". Hence, in Dobbie, where an easement existing before the land was brought under the RPA was not recorded on the Register when the land was first brought under the RPA, the Court of Appeal rightly held that it was a "case of the omission" of an easement regardless of what had brought about the absence of the easement from the Register. On this understanding of "omission", s 42(1)(a1) both presupposes the continued existence and provides for the continued effect of that which has been omitted notwithstanding it does not appear on the relevant folio of the Register. It is an understanding capable of ready application to an easement created under a Commonwealth Act or under a State Act other than the RPA. The presupposition for applying s 42(1)(a1) (that the easement continues to exist) is accurate. Section 42(1)(a1) then provides for its continued effect in respect of the land. It is an understanding which is also capable of application to easements created under the RPA, at least in the case of an easement created by registration31 of the relevant dealing under the RPA but not recorded on the folio relating to the servient tenement. The easement in that case continues to exist because the Register. Section 42(1)(a1) then provides for its continued effect in respect of the land. it has been registered and not removed from Other considerations intrude when an easement created under the RPA by registration of a dealing has later been removed by the Registrar-General. When an easement has been previously recorded on the Register, but is no longer recorded because it has been deliberately removed from the Register, it could be said that the easement was "not there". It is more accurate, however, to say that the easement is "no longer there because it has been removed". The significance to be given to the fact of the easement's removal from the Register requires attention to fundamental principles. The relevant exception to the paramountcy of the registered proprietor's title is "in the case of the omission" of an easement (where the hypothesis is that the easement continues to exist but is not recorded). Because the RPA provided for title by registration, the deliberate removal from the Register of an easement created by registration cannot be treated as a "case of the omission ... of an easement" for the purposes of s 42(1)(a1). The 30 (1991) 23 NSWLR 625 at 635 per Kirby P, 660 per Priestley JA (Handley JA agreeing). 31 Section 36(6A) provided that registration occurs "when the Registrar-General has made such recording in the Register with respect to the dealing as the Registrar-General thinks fit". presupposition for the operation of s 42(1)(a1), that the easement continues to exist, is not valid. The easement has been removed from the Register. The RPA's provisions for the alteration of the Register Section 32(6) of the RPA gave32 the Registrar-General power "to cancel in such manner as the Registrar-General considers proper any recording in the Register that the Registrar-General is satisfied does not affect the land to which the recording purports to relate". If the Registrar-General was satisfied that the easement no longer subsisted, s 32(6) empowered cancellation of the recording of the easement on the folios relating to both the dominant and the servient tenements. The RPA gave the Registrar-General other powers in respect of the recording of easements, including power under s 49(1) to cancel the recording of abandoned easements, but the ambit of those other powers need not be examined. Where the Registrar-General removes an easement from the Register after giving notice under s 12A(1) to the owner of the dominant tenement, that owner would not have an action against the Registrar-General in respect of that removal. Section 12A(3) provided that where a person given a notice under s 12A(1) did not serve on the Registrar-General (or give the Registrar-General notice of) an order of the Supreme Court restraining the Registrar-General from taking the proposed action altering the Register, "no action by that person or by any person claiming through or under that person shall lie against the Registrar-General in respect of the taking of the action specified in the notice". Section 12A(3) would bar a claim by the owner of the dominant tenement for any relief against the Registrar-General in respect of the removal of the easement, including any form of relief that would compel the Registrar-General to restore the easement to the Register. Whether s 12A(3) would also bar a subsequent purchaser of the dominant tenement from bringing an action against the Registrar-General to compel the Registrar-General to restore the easement to the Register turns on whether the subsequent purchaser was "claiming through or under" the former owner of the dominant tenement who receives notice under s 12A(1). That question need not be considered in this appeal because there is a more fundamental reason why the subsequent purchaser cannot compel the Registrar-General to restore the 32 Power of this kind was first given to the Registrar-General by s 37(b) of the Conveyancing (Amendment) Act 1930 (NSW), which inserted s 32(3) into the RPA. The inserted provision deemed the Registrar-General always to have had the power. easement. The interest which the former owner of the dominant tenement transferred was the interest as registered proprietor of land which by then did not have the benefit of any registered easement. Because it is a system of title by registration, the subsequent purchaser only acquired that interest shorn as it then was of any recorded easement. If the Registrar-General removed an easement from the Register without giving notice under s 12A(1) to the owner of the dominant tenement, that owner would readily be seen to be a "person who is dissatisfied" with the Registrar-General's decision to remove the easement and so have standing to apply to the Supreme Court for review of that decision under s 122(1) of the RPA. On review of the Registrar-General's exercise of power under s 32(6), it would be open for the owner to submit that the Registrar-General could not have been "satisfied" that the easement no longer affected the land. But this course would not be open to the purchaser who accepted a transfer of that dominant tenement. The decision to remove which the subsequent purchaser would seek to challenge did not relate to land in which that purchaser had any interest at the time the decision was made. That purchaser would not be a "person who is dissatisfied" with that decision. This appeal At the behest of Castle, as registered proprietor of the servient tenement, the Registrar-General removed the easement from both the folio relating to the Strathallen land and the folio relating to the Sailors Bay land. At trial it was found, and in the Court of Appeal it was common ground, that a notice of intention to remove the easement was given to Mr and Mrs Howard as the then registered proprietors of the dominant tenement. The notice was not in evidence at trial or in the Court of Appeal and Sahab submitted that, contrary to the undisturbed finding that notice was given, this Court should find that no notice was given. Sahab offered no satisfactory basis for overturning the finding. The Registrar-General's minute papers recorded that no objection had been received to the application for removal and the inference that notice of the application was given to the Howards is irresistible. It may also be inferred that the notice accorded with s 12A and told the Howards that the Registrar-General would remove the easement at or after the expiration of a stated period unless restrained by an order of the Supreme Court from doing so. The Howards made no objection to the removal of the easement. The Howards having made no objection and obtained no order restraining the Registrar-General from proceeding, s 12A(3) would have barred them from bringing an action against the Registrar-General to compel the restoration of the easement to the Register. Of course, if the Howards could have established some personal claim against Castle, they could have pursued that claim33. But unless and until the Howards, by personal action, compelled Castle to procure restoration of the easement to the Register, the title the Howards held to the Strathallen land after the removal of the easement was a title which did not include any easement over the Sailors Bay land. That is, the interest which the Howards sold and transferred to Sahab was their interest as registered proprietors of land which, at that time, did not have the benefit of any registered easement over Castle's land. The Howards therefore did not transfer (and could not have transferred) to Sahab any easement over Castle's land. And unless Sahab could establish some personal claim against Castle to compel it to procure restoration of the easement to the Register (a claim that Sahab has not made), it follows that Sahab does not have the easement which it claimed in this appeal. The easement created by the 1921 transfer was not "omitted" from the folio relating to either piece of land. The easement had been removed from the Register and the fact of its removal was apparent from the Register before Sahab bought the Strathallen land. Four further points should be made. First, it is to be noted that Sahab's case was that deliberate alteration of the Register worked no change in the interests to which Castle's title was subject. Sahab alleged that Castle's title remained subject to an interest which had once been recorded in the Register but which had since been removed from the Register in accordance with procedures provided by the RPA, even though Sahab's predecessor in title (the Howards) would have been barred from asserting the interest Sahab claimed. This result is properly described as odd or surprising. It is a result which points firmly against construing the RPA in the way Sahab urged. Second, Sahab's case sought to give continued effect to the easement after its removal from the Register even though the easement took effect only upon registration of the 1921 transfer. As already noted, s 41 provided that no instrument, until registered, shall be effectual to pass any estate or interest in land under the RPA. Yet an instrument effective to create rights or interests in the relevant land only on registration of the instrument was alleged to continue in effect despite removal of the interest from the Register. Again, the result urged 33 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89 at 167-172 [190]-[198]; [2007] HCA 22; Frazer v Walker [1967] 1 AC 569 at 585. by Sahab is odd or surprising and points firmly against construing the RPA in the way Sahab urged. Third, Sahab's argument that some or all of ss 12, 122, 136 and 138 of the RPA provided bases for it not only to challenge the Registrar-General's decision to remove the easement but also to obtain restoration of the easement to the Register assumed that Sahab was a "person who is dissatisfied"34 with a decision of the Registrar-General. At first instance, in the Court of Appeal and in this Court, Sahab sought to challenge both the 2001 decision to remove the easement and the 2008 decision to refuse to restore the easement. Whether Sahab could challenge the 2001 decision in this Court without amending its notice of contention need not be examined. In relation to the Registrar-General's decision in 2008 to refuse to restore the easement to the Register, there was no omission of the easement. It had been deliberately removed from the Register. Further, Sahab had obtained title by registration of the transfer from the Howards to land which did not at that time have the benefit of a recorded easement. Sahab got what appeared on the Register. In those circumstances, Sahab cannot be dissatisfied with the decision of the Registrar-General not to restore the easement in 2008. In relation to the Registrar-General's decision in 2001 to remove the easement, Sahab alleged that the Registrar-General should not have removed the easement because the Registrar-General could not reasonably have been satisfied that it did not affect the land. But this argument assumed, and did not demonstrate, that Sahab was a "person who is dissatisfied"35 with the Registrar-General's decision to exercise power under s 32(6) to remove the easement from the Register. The decision to remove which Sahab sought to challenge did not relate to land in which Sahab had any interest at the time the decision was made. Sahab, having acquired the title to the Strathallen land which the Howards had at the time of sale, did not then become a person dissatisfied with the Registrar-General's decision to remove. Section 122 is not reached. Fourth, and most importantly, Sahab's reference to and reliance upon the remedial provisions of the RPA (in particular s 12(1)(d)) depended upon Sahab showing that this was a case of "omission". And Sahab's case in relation to both ss 12(1)(d) and 42(1)(a1) ultimately depended upon reading "omission" in each as including a case where an easement, once registered, had been deliberately removed from the Register. As earlier explained, while it may be right to observe that, after its removal, the easement is "not there", this observation provides only a snapshot of the state of the Register. It is more accurate to say that the easement is "no longer there because it was deliberately removed". That is not a case of the omission of an easement. Conclusion and orders Because Castle's land is no longer subject to the easement created by the 1921 transfer, the covenants which related to the easement no longer apply. The questions which Sahab sought to agitate by cross-appeal are not reached and need not be considered. The appeal to this Court should be allowed. The application for special leave to cross-appeal should be refused. The first respondent should pay the appellant and the second respondent the costs of the appeal and of the application for special leave to cross-appeal. The orders of the Court of Appeal of the Supreme Court of New South Wales made on 5 April 2012 should be set aside and in their place there should be orders that the appeal to that Court is dismissed with costs. I agree with the orders proposed by Hayne, Crennan, Kiefel and Bell JJ and am content to adopt their statement of facts and their abbreviations. However, I consider the determinative issue to be different. The proceedings in the Supreme Court of New South Wales Sahab brought against the Registrar-General, to which Castle was joined, were in substance for judicial review of two decisions of the Registrar-General. The first was the decision in November 2001 to remove the easement from the Register under s 32(6) of the RPA ("the 2001 decision"). The second was the decision in October 2008 not to restore the easement to the Register under s 12(1)(d) of the RPA ("the 2008 decision"). Sahab's case, shorn of detail, was that the 2001 decision was a nullity because the Registrar-General erred in law in making it and that, in making the 2008 decision, the Registrar-General failed to perform a statutory duty to correct the error made in the 2001 decision. Sahab invoked the jurisdiction of the Supreme Court under each of ss 122 and 138 of the RPA and s 65 of the Supreme Court Act 1970 (NSW). In my view, once it was found that the Registrar-General had notified Sahab's predecessors in title in accordance with s 12A(1) of the RPA before making the 2001 decision – a finding that should not now be disturbed – s 12A(3) of the RPA provided the short and complete answer to the whole of Sahab's case. Section 12A of the RPA provides: "(1) The Registrar-General may, before taking any action that alters the Register, give notice of the proposed action to any person that the Registrar-General considers should be notified of it. (2) Where the Registrar-General has given notice pursuant to the powers conferred upon the Registrar-General by subsection (1), the Registrar-General may refuse to take the action until after the expiration of a period specified in the notice and the Registrar- General may proceed to take the action at or after the expiration of the period so specified unless the Registrar-General is first served with, or with written notice of, an order of the Supreme Court restraining the Registrar-General from so doing. (3) Where a person given notice under subsection (1) does not within the time limited by the notice serve upon the Registrar-General or give the Registrar-General written notice of an order made by the Supreme Court restraining the Registrar-General from taking the action, no action by that person or by any person claiming through or under that person shall lie against the Registrar-General in respect of the taking of the action specified in the notice. (4) No action shall lie against the Registrar-General for failure to give a notice under subsection (1)." In the form in which s 12A was inserted into the RPA in 197036, the only action of the Registrar-General that could be covered by a notice under s 12A(1) was the registration of a "dealing" as defined in s 3. The object of the section was identified at the time of insertion as being37: "to authorise the Registrar-General temporarily to delay registration of a dealing while he notifies a person whom he considers may contest the dealing that he proposes to register the dealing after the expiration of a specified period and to absolve him from liability for registering the dealing if he is not, before the expiration of that period, restrained by the Court from so doing". The section was explained as38: "designed to put a contest where it properly belongs – that is, between the interested parties – and to absolve the Registrar-General and the assurance fund from liability if a person deprived of an interest in land has been afforded, and ignored, an opportunity to safeguard that interest." The reference in that explanation to the "assurance fund" was to the Torrens Assurance Fund established under s 134 of the RPA. Under s 132 of the RPA, proceedings before a court for the payment of compensation are taken against the Registrar-General as nominal defendant. Section 12A was amended in 199639 to take its current form, in which it covers the taking by the Registrar-General of any action that alters the Register. The amendment was described at that time as "thereby extend[ing] this fast and simple process for clarifying rights to all cases, not just those in which a dealing is to be registered"40. 36 Real Property (Amendment) Act 1970 (NSW), s 4(b). 37 New South Wales, Real Property (Amendment) Bill 1970, Explanatory Note at (e). 38 New South Wales, Legislative Council, Parliamentary Debates (Hansard), 11 March 1970 at 4106. 39 Real Property Amendment Act 1996 (NSW), Sched 1 [4]-[7]. 40 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 15 October 1996 at 4798. The legislative declaration in s 12A(3) that "no action … shall lie against the Registrar-General in respect of the taking of the action specified in the notice" by a person given the notice under s 12A(1) "or by any person claiming through or under that person" gives rise to two issues of construction. Both were addressed in the Court of Appeal, in reasons for judgment of Campbell JA and Tobias AJA, with whom McColl JA agreed. One issue is whether a successor in title to a person given notice under s 12A(1) is a "person claiming through or under that person". On that issue, the Court of Appeal held that the word "through" in s 12A(3), as elsewhere in the RPA, involved the idea that41: "A claims 'through' B if A has acquired title or rights from B, or from someone who has acquired rights from B, and so on through howsoever many intermediary titleholders or holders of rights there might be between A and B." That construction of the word "through" led to the conclusion that42: "s 12A(3) prevents anyone who is the successor of a person to whom a notice under s 12A(1) has been given from bringing an 'action' against the Registrar-General in which they assert rights arising from the action taken by the Registrar-General after service of the notice foreshadowing the alteration of the register." The other issue concerns the nature and scope of the legislative declaration that "no action … shall lie against the Registrar-General in respect of the taking of the action specified in the notice". On that issue, the Court of Appeal said that43: "[i]t is apparent that s 12A(3) operates to prohibit an action against the Registrar-General for altering the register, where otherwise he might be liable for doing so in circumstances which might expose him to an action for damages." 41 Sahab Holdings Pty Ltd v Registrar-General (No 2) (2012) 16 BPR 30,353 at 42 (2012) 16 BPR 30,353 at 30,361 [33]. 43 (2012) 16 BPR 30,353 at 30,358 [14]. However, it went on to state that44: "[t]here is no justification … for construing the section as prohibiting the obtaining of relief against the Registrar-General, where other provisions of the Act such as ss 122 and 138 specifically empower the Supreme Court to require him to correct an erroneous alteration to the register." Its conclusion was that "[a]n 'action' in s 12A(3) does not extend to proceedings against the Registrar-General permitted by other sections of the Act, either alone or in combination"45. I agree with the reasoning and conclusion of the Court of Appeal on the first issue of construction. A successor in title to a person given notice in accordance with s 12A(1) is a person claiming "through" that person within the meaning of s 12A(3) and is therefore subject to the legislative declaration in s 12A(3) that "no action … shall lie against the Registrar-General in respect of the taking of the action specified in the notice". However, I am unable to agree with the Court of Appeal on the second issue of construction. In my view, s 12A manifests a legislative choice that a notified alteration of the Register by the Registrar-General should not be legally impugned after the alteration is made46. The section ensures that no person notified by the Registrar- General of an intention to alter the Register, and no successor in title to such a person, has any right to challenge that alteration once made if the person has failed to object to that notice. In so doing, the section fulfils its identified legislative purpose of providing a "simple process for clarifying rights"47 in accordance with which a person who may be deprived of an interest in land by an alteration of the Register by the Registrar-General is given a timely opportunity to safeguard that interest in a "contest … between the interested parties"48. The temporal confinement of that process to a period before the Register is altered 44 (2012) 16 BPR 30,353 at 30,358 [14]. 45 (2012) 16 BPR 30,353 at 30,358 [14]. 46 Cf R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Ltd (1953) 88 CLR 100 at 119; [1953] HCA 22. 47 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 15 October 1996 at 4798. 48 New South Wales, Legislative Council, Parliamentary Debates (Hansard), 11 March 1970 at 4106. enhances "indefeasibility of title", a conception "central in the system of registration", in accordance with which "registration once effected must attract the consequences which the [RPA] attaches to registration whether that was regular or otherwise"49. The expression "no action … shall lie" in s 12A(3) is best read not as a procedural prohibition but as a substantive alteration of legal rights: operating to prevent a notified alteration of the Register by the Registrar-General giving rise to infringement of a legal right or breach of a legal duty in respect of which relief might afterwards be obtained at the suit of the person notified or a successor in title. The word "action" is best read, without limitation, as encompassing any proceeding for the vindication of a legal right or to compel the performance of a legal duty. Amongst other circumstances, an action is "in respect of the taking of the action specified in the notice" insofar as the action directly or indirectly challenges the validity of a notified alteration of the Register. Section 12A so read is not in tension with the jurisdiction of the Supreme Court under s 122 or s 138 of the RPA any more than it is in tension with the jurisdiction of the Supreme Court under s 132 of the RPA. The jurisdiction remains unaffected. The operation of s 12A is rather that there is no infringement of a legal right or breach of a legal duty in respect of which relief might be obtained in an action against the Registrar-General in the exercise of that jurisdiction. Section 12A(3) operates as a plea in bar to any action that might be brought. The result is that Sahab, as successor in title to persons given notice in accordance with s 12A(1), became a person subject to s 12A(3) of the RPA and that s 12A(3) operated as a plea in bar to Sahab's claims in the proceedings Sahab brought against the Registrar-General for judicial review of both the 2001 decision and the 2008 decision. Sahab's claim for judicial review of the 2001 decision was a direct challenge to the validity of the notified alteration of the Register by the Registrar-General. Sahab's claim for judicial review of the 2008 decision was an indirect challenge to the validity of the same notified act of the Registrar-General. It was, in the words of Slattery J, "merely an attempt to reopen the 2001 decision"50. It is neither necessary nor appropriate for me to address other issues or potential issues raised or sought to be raised in the appeal and cross-appeal. In particular, it is not necessary or appropriate for me to address: the meaning of the 49 Frazer v Walker [1967] 1 AC 569 at 580; Breskvar v Wall (1971) 126 CLR 376 at 413; [1971] HCA 70. 50 Sahab Holdings Pty Ltd v Registrar-General (No 2) (2010) 14 BPR 27,459 at word "omission" in s 42(1)(a1) of the RPA; the scope of the power, and any attendant duty, of the Registrar-General under s 12(1)(d) of the RPA to "correct errors and omissions in the Register"; whether the proceedings brought by Sahab were "for the recovery of any land" so as to be within s 138 of the RPA; and whether Sahab was a person "dissatisfied" with the 2001 decision within the meaning of s 122 of the RPA (an issue the Court of Appeal found Castle to be 51 Sahab Holdings Pty Ltd v Registrar-General (2011) 15 BPR 29,627 at 29,674-
HIGH COURT OF AUSTRALIA COMMISSIONER OF TAXATION APPELLANT AND KAMAL JAYASINGHE RESPONDENT Commissioner of Taxation v Jayasinghe [2017] HCA 26 9 August 2017 ORDER Appeal allowed. Set aside the order of the Full Court of the Federal Court of Australia made on 9 June 2016 and in its place order that: the appeal to that Court be allowed; and the decision of the Administrative Appeals Tribunal made on 29 June 2015 be set aside and in its place order that the decision under review be affirmed. On appeal from the Federal Court of Australia Representation J O Hmelnitsky SC with T L Phillips for the appellant (instructed by Australian Government Solicitor) A H Slater QC with L McBride for the respondent (instructed by Balazs Lazanas & Welch LLP) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Commissioner of Taxation v Jayasinghe Income tax – International Organisations (Privileges and Immunities) Act 1963 (Cth) ("the IOPI Act"), s 6(1)(d)(i) – Whether taxpayer "holds an office in" an international organisation to which the IOPI Act applies – Whether taxpayer entitled to exemption from taxation on salaries and emoluments. Income tax – Taxation Administration Act 1953 (Cth), Sched 1, s 357-60(1) – Taxation Determination TD 92/153 – Whether Commissioner bound to exempt taxpayer from taxation. Words and phrases – "expert on mission", "incidents of the relationship", "international organisation", "person who holds an office", "skills and expertise", "specialist services", "terms of engagement". International Organisations (Privileges and Immunities) Act 1963 (Cth), s 6(1)(d), Fourth Schedule, Pt I. Taxation Administration Act 1953 (Cth), Sched 1, s 357-60(1). United Nations (Privileges and Immunities) Regulations 1986 (Cth), reg 10. Taxation Determination TD 92/153. Convention on the Privileges and Immunities of the United Nations [1949] ATS 3, Art V, s 18. KIEFEL CJ, KEANE, GORDON AND EDELMAN JJ. Section 6(1)(d)(i) of the International Organisations (Privileges and Immunities) Act 1963 (Cth) ("the IOPI Act") provides for the conferral of particular privileges and immunities upon a person "who holds an office in an international organisation to which [the IOPI Act] applies". One privilege is "[e]xemption from taxation on salaries and emoluments received from the organisation"1. The United Nations ("the UN") is an international organisation to which the IOPI Act applies2. Under an Individual Contractor Agreement, the respondent, Mr Kamal Jayasinghe, was engaged by the United Nations Office for Project Services ("UNOPS"), an operational arm of the UN, as a "project manager" in the building of a 190 kilometre gravel road in Sudan. Two questions were raised on appeal to this Court. The first is whether, in the income years ended 30 June 2010 and 30 June 2011, Mr Jayasinghe was a person who held an office in an international organisation within the meaning of s 6(1)(d)(i) of the IOPI Act, such that he was entitled to exemption from taxation on the income he received from UNOPS. The second is whether, by reason of s 357-60(1) of Sched 1 to the Taxation Administration Act 1953 (Cth) ("the Administration Act") the appellant, to exempt the Commissioner of Taxation, was bound Mr Jayasinghe from taxation on the income he received from UNOPS. Both of those questions should be answered in the negative. The appeal should be allowed. and Taxation Determination TD These reasons will set out the relevant facts, the assessments issued by the Commissioner and the decisions below, consider the applicable legislative framework and the proper construction of s 6(1)(d)(i) of the IOPI Act and then turn to address TD 92/153. 1 See cl 2 of Pt I of the Fourth Schedule to the IOPI Act. 2 See the definition of "international organisation to which this Act applies" in s 3(1) of the IOPI Act; reg 3 of the United Nations (Privileges and Immunities) Regulations 1986 (Cth). 3 Titled "Income tax: who is a 'person who holds an office' as specified in various (Privileges and International Organisations the regulations made under Immunities) Act 1963?". Gordon Edelman Facts Mr Jayasinghe is a qualified civil engineer. During the relevant income years, he was an Australian resident and, for parts of those years, he was engaged by UNOPS to work in Sudan as a project manager. Mr Jayasinghe worked in Sudan from approximately 13 October 2009 until 31 December 2010 and again from 28 June 2011 until 31 December 2011. Mr Jayasinghe was engaged under an "Individual Contractor Agreement". The two periods were covered by three Individual Contractor Agreements, which were relevantly in substantively similar terms4. Each Individual Contractor Agreement was deemed to comprise four documents, in the following order of priority – the Individual Contractor Agreement, the General Terms and Conditions of Individual Contractor Agreements in Annex A, the Terms of Reference in Annex B and the Individual Contractor Agreement Policy5. Annexes A and B were both an "integral part" of the Individual Contractor Agreement. An Individual Contractor Agreement was used to engage a person in their individual capacity "to perform a specific task or deliver a specific piece of work"; it could not be used to engage a person "[t]o perform regular core functions". Functions "discharged to implement a project or a portfolio of related projects" were not normally considered core functions. Mr Jayasinghe was engaged by UNOPS as an individual contractor to provide specialist services in Sudan. His functional title was "Project Manager". 4 The first Individual Contractor Agreement commenced on 13 October 2009 and expired "without prior notice upon satisfactory completion of the services", but no later than 12 October 2010. The second Individual Contractor Agreement commenced on 13 October 2010 and expired "without prior notice upon satisfactory completion of the services", but no later than 10 January 2011. The third Individual Contractor Agreement commenced on 28 June 2011 and expired "without prior notice upon satisfactory completion of the services", but no later than 31 December 2011. 5 For convenience, to "Individual Contractor Agreement" is to each Individual Contractor Agreement that applied during the relevant period and the documents that were deemed to form part of each of them. these reasons a reference Gordon Edelman His task was "[c]ompletion of the road … on time and under budget"6. His supervisor was the Head of Programme. Upon certification that the services had been satisfactorily performed in accordance with the Individual Contractor Agreement, Mr Jayasinghe was to be paid a monthly fee by UNOPS. Under the Individual Contractor Agreement, Mr Jayasinghe had the legal status of an independent contractor of UNOPS, serving in his individual capacity. He had no authority or other right to enter into any legal or financial commitments or incur any obligations on behalf of UNOPS and was responsible for paying any tax levied by the Australian Government on his UNOPS earnings. Moreover, Mr Jayasinghe was solely liable for claims by third parties arising from his own negligent acts or omissions in the course of his service under the Individual Contractor Agreement. Under no circumstances was UNOPS liable for such claims by third parties. Accordingly, Mr Jayasinghe was expected to obtain professional liability insurance if providing professional services to UNOPS. Under the Individual Contractor Agreement, he did not have the status of an official of the UN for the purposes of the Convention on the Privileges and Immunities of the United Nations adopted by the General Assembly of the UN on 13 February 19467 ("the 1946 UN Convention"). However, under the Individual Contractor Agreement, he was engaged to perform "specialist services" in recognition of his "skills and expertise". Further, at least from 1 May 2010, he was considered an expert on mission for the UN within the terms of s 22 in Art VI of the 1946 UN Convention and was accorded, by the UN, the privileges and immunities provided for in s 22 in Art VI of the 1946 UN Convention8. "UNOPS ID Card". The back of the card contained a request that "all those engaged by UNOPS, he held 6 From 28 June 2011, his task was, in general terms, to prepare and issue regular project reports and maintain diaries and progress reports. [1949] ATS 3. 8 The Individual Contractor Agreement Policy effective from 1 May 2010 provided that, in general, all international individual contractors were considered "experts on mission the for 1946 UN Convention. [the UN]" within terms of s 22 in Art VI of the Gordon Edelman whom it may concern … extend to the bearer the courtesies, facilities, privileges and immunities which pertain to his/her office, and … facilitate, by all suitable means the journeys and missions on which he (or she) is engaged. If found, please return to the UN Security Office". Assessments and decisions below In September 2013, notices of amended assessment were issued to Mr Jayasinghe for his earnings from UNOPS in the income years ended 30 June 2010 and 30 June 2011. Mr Jayasinghe lodged an objection to those assessments. The Commissioner disallowed the objection. the Commissioner's decision. Mr Jayasinghe applied to the Administrative Appeals Tribunal for a review of the Commissioner's decision9. The Tribunal concluded that the substance of the relationship between Mr Jayasinghe and UNOPS, and the obligations created and implemented in carrying out the project, were such that he was the holder of an office within the meaning of s 6(1)(d) of the IOPI Act and that Mr Jayasinghe was a person who worked as an employee of UNOPS and was therefore entitled to the benefit of TD 92/153. The Tribunal set aside A majority of the Full Court of the Federal Court of Australia (Pagone and Davies JJ, Allsop CJ dissenting) dismissed an appeal by the Commissioner10. The majority upheld the Tribunal's construction of s 6(1)(d)(i) of the IOPI Act and held that TD 92/153 applied to exempt Mr Jayasinghe from taxation. The IOPI Act11 Section 6 of the IOPI Act, titled "Privileges and immunities of certain international organisations and persons connected therewith", relevantly provides for the conferral, by regulations, of privileges and immunities on entities and persons in the following terms: 9 Re Jayasinghe and Federal Commissioner of Taxation (2015) 101 ATR 476. 10 Federal Commissioner of Taxation v Jayasinghe (2016) 103 ATR 357. 11 The legislative history of the IOPI Act was relevantly described by this Court in Macoun v Federal Commissioner of Taxation (2015) 257 CLR 519 at 527-530 [23]-[37]; [2015] HCA 44. Gordon Edelman "(1) Subject to this section, the regulations may, either without restriction or to the extent or subject to the conditions prescribed by the regulations: confer upon an international organisation to which this Act applies: confer: upon a person who holds, or is performing the duties of, an office prescribed by the regulations to be a high office in an international organisation to which this Act applies all or any of the privileges and immunities specified the Second Schedule; and in Part I of upon a person who has ceased to hold, or perform the duties of, such an office the immunities specified in Part II of the Second Schedule; confer: upon a person who is accredited to, or is in attendance at an international conference convened by, an international organisation to which this Act applies as a representative of: a country other than Australia; another international organisation to which this Act applies; or an overseas organisation to which this Act applies; all or any of the privileges and immunities specified in Part I of the Third Schedule; and upon a person who has ceased to be accredited to such an organisation, or has attended such a conference, as such a representative the immunities specified in Part II of the Third Schedule; Gordon Edelman confer: upon a person who holds an office in an international organisation to which this Act applies (not being an office prescribed by the regulations to be a high office) all or any of the privileges and immunities specified in Part I of the Fourth Schedule[12]; and upon a person who has ceased to hold such an office the immunities specified in Part II of the Fourth Schedule; and confer: the work, of an to which upon a person who is serving on a committee, or is international participating organisation performing, whether alone or jointly with other persons, a mission on behalf of such an organisation all or any of the privileges and immunities specified in Part I of the Fifth Schedule; and this Act applies or upon a person who has served on such a committee or participated in such work or has performed such a mission the immunities specified in Part II of the Fifth Schedule. Regulations made for the purposes of this section may be of general application or may relate to: particular international organisations to which this Act applies; particular offices or classes of offices; particular conferences, committees or missions or classes of conferences, committees or missions; or 12 Clause 2 of Pt I of the Fourth Schedule to the IOPI Act provides for "[e]xemption from taxation on salaries and emoluments received from the organisation". Gordon Edelman representatives of particular countries, of particular international organisations to which this Act applies or of particular overseas organisations to which this Act applies." (emphasis added) The phrase "international organisation to which this Act applies" is defined relevantly to mean "an organisation that is declared by the regulations to be an international organisation to which [the IOPI Act] applies"13 and includes: an organ of, or office within, an organisation that is so declared; a commission, council or other body established by such an organisation or organ; and a committee, or sub-committee of a committee, of such an organisation, organ, commission, council or body." A number of matters should be noted at the outset. First, under s 6(1) of the IOPI Act, by reference to the First to Fifth Schedules to the IOPI Act, certain privileges and immunities are extended to an international organisation to which the IOPI Act applies and then on different bases to different categories of persons The Schedules set the "connected" with that international organisation. "upper limits"14 of the privileges and immunities that are to be extended to an international organisation and the different categories of persons connected with that international organisation. Privileges and immunities as prescribed in the Second to Fifth Schedules are extended to those persons connected with the international organisation while they maintain the connection (Pt I of each Schedule) and after the connection ceases (Pt II of each Schedule). The structure of s 6(1) assumes that there will be criteria to distinguish between different categories of personnel entitled to different privileges and immunities. So, for example, if a person holds a high office in an international organisation15, the privileges and immunities conferred on them in accordance with the Second Schedule are more extensive than those privileges and the immunities that would be conferred on in accordance with them 13 s 3(1) of the IOPI Act. See also s 6(2)(a) of the IOPI Act. 14 See Australia, House of Representatives, Parliamentary Debates (Hansard), 8 May 15 See s 6(1)(b)(i) of the IOPI Act. Gordon Edelman Fourth Schedule if they held an office (that did not qualify as a high office) in an international organisation16. This appeal is concerned with s 6(1)(d)(i) and the Fourth Schedule – the privileges and immunities of a person who holds an office, other than a high office. The Fourth Schedule provides: "Part I Privileges and Immunities of Officer (other than High Officer) of International Organisation Immunity from suit and from other legal process in respect of acts and things done in his capacity as such an officer. Exemption from taxation on salaries and emoluments received from the organisation. Exemption (including exemption of a spouse and any dependent relatives) from the application of laws relating to immigration and the registration of aliens. Exemption from the obligation to perform national service. Exemption from currency or exchange restrictions to such extent as is accorded to an official, of comparable rank, forming part of a diplomatic mission. The like repatriation facilities (including repatriation facilities for a spouse and any dependent relatives) in time of international crisis as are accorded to a diplomatic agent. The right to import furniture and effects free of duties when first taking up a post in Australia and to export furniture and effects free of duties when leaving Australia on the termination of his functions. 16 See s 6(1)(d)(i) of the IOPI Act. Gordon Edelman Part II Immunities of Former Officer (other than High Officer) of International Organisation Immunity from suit and from other legal process in respect of acts and things done in his capacity as such an officer." (emphasis in bold added) Second, s 13 of the IOPI Act provides the Governor-General with the power to make regulations, not inconsistent with the IOPI Act, prescribing all matters required or permitted by the IOPI Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the IOPI Act. The UN Regulations This appeal concerns the UN. Regulation 3 of the United Nations (Privileges and Immunities) Regulations 1986 (Cth) ("the UN Regulations") provides that the UN is an international organisation to which the IOPI Act applies17. The Commissioner accepted that the IOPI Act also applies to UNOPS, as it is an operational arm of the UN. Regulations 4 to 11 of the UN Regulations reflect the structure of s 6(1) of the IOPI Act. Regulations 4 and 5 address the UN and prescribe specific privileges and immunities in the First Schedule to the IOPI Act that attach to the UN as an organisation. Regulations 6 to 8 prescribe the offices of Secretary-General of the UN, Under Secretary-General of the UN and Assistant Secretary-General of the UN to be high offices in the UN and provide that a person who holds, or is performing the duties of, each of those offices has the the Second Schedule. privileges and Regulation 9(1) provides that a person accredited to or in attendance at an international conference convened by the UN as a representative of a country (other than Australia) has the privileges and immunities specified in Pt I of the Third Schedule. Regulation 11 is concerned with a person performing a mission on behalf of the UN. immunities specified in Pt I of Relevantly for Mr Jayasinghe, reg 10 of the UN Regulations, titled "Privileges and immunities of officers (other than high officers) of [the UN]", provides that: 17 See also s 6(2)(a) of the IOPI Act. Gordon Edelman "(1) … [A] person who holds an office in [the UN], other than a person who holds, or is performing the duties of, an office specified in subregulation 6(1), 7(1) or 8(1), has the privileges and immunities specified in Part I of the Fourth Schedule to [the IOPI Act]. (3) A person who has ceased to hold an office in [the UN], other than an office specified in subregulation 6(1), 7(1) or 8(1), has the immunities specified [the IOPI Act]." (emphasis added) the Fourth Schedule in Part II of Mr Jayasinghe – not "a person who holds an office" Proper construction of s 6(1)(d)(i) This appeal raises the question of the proper construction of s 6(1)(d)(i) of the IOPI Act and, in particular, the phrase "a person who holds an office in an international organisation". Neither the word "office", nor the composite phrase "holds an office in an international organisation", is defined in the IOPI Act. So, what does "holds an office in an international organisation" mean? Although a similar phrase, "a person who holds an office in [the UN]", is used in reg 10(1) of the UN Regulations, the phrase in s 6(1)(d)(i) of the IOPI Act cannot be limited to or defined by reference to the UN Regulations, because the IOPI Act extends to any organisation that is declared by the regulations to be an international organisation to which the IOPI Act applies18. The relevant statutory language in s 6(1)(d)(i), "a person who holds an office in an international organisation", directs attention to the concept of holding an office in an international organisation. Section 6(1)(b)(i) of the IOPI Act is similarly directed to the concept of holding an office – a high office – in an international organisation. Those provisions can be contrasted with s 6(1)(c)(i) and (e)(i), which are directed to being accredited to or undertaking an identified activity with the organisation. "[A] person who holds an office in an international organisation" stands in contrast to "a person who is accredited to, or is in attendance at an international conference convened by, an international organisation"19 or 18 s 5 of the IOPI Act. 19 s 6(1)(c)(i) of, and the Third Schedule to, the IOPI Act. Gordon Edelman "a person who is serving on a committee, or is participating in the work, of an international organisation … or is performing, whether alone or jointly with other persons, a mission on behalf of such an organisation"20. Of course, a person may not fall within any of the categories in s 6(1). The word "office", although a general word, must not be read in isolation; it must be read in context21. And read in context in s 6(1) of the IOPI Act, it is apparent that the word "office" in the phrase "holds an office in an international organisation" is not, and cannot be, defined by reference to permanence or succession. In Great Western Railway Co v Bater, Rowlatt J said that an office was something "which was a subsisting, permanent, substantive position, which had an existence independent of the person who filled it, and which went on and was filled in succession by successive holders"22. The Tribunal23 and the majority of the Full Court24 adopted and applied that test, the correctness of which Mr Jayasinghe sought to uphold on appeal to this Court, in concluding that he was the holder of an office within the meaning of s 6(1)(d)(i) of the IOPI Act. Bater does not assist in construing s 6(1)(d)(i) of the IOPI Act. First, it was concerned with the meaning of the word "office" in a different statutory context – one which involved language that, on appeal to the House of Lords, Lord Wrenbury described as "unintelligible"25. 20 s 6(1)(e)(i) of, and the Fifth Schedule to, the IOPI Act. 21 Metropolitan Gas Co v Federated Gas Employees' Industrial Union (1925) 35 CLR 449 at 455; [1925] HCA 5; Taylor v Public Service Board (NSW) (1976) 137 CLR 208 at 213; [1976] HCA 36; K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 315; [1985] HCA 48; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69]; [1998] HCA 28; Independent Commission Against Corruption v Cunneen (2015) 256 CLR 1 at 28 [57]; [2015] HCA 14. 22 [1920] 3 KB 266 at 274. 23 Jayasinghe (2015) 101 ATR 476 at 481 [35], 482 [44]. 24 Jayasinghe (2016) 103 ATR 357 at 370 [47]. 25 Great Western Railway Co v Bater [1922] 2 AC 1 at 30. Gordon Edelman Second, in construing s 6(1)(d)(i) of the IOPI Act, the word "office" in the composite phrase "holds an office in" cannot be limited, or defined by reference, to the meaning of "office" in Bater; it cannot be limited, or defined by reference, to notions of permanence or succession. The concept of holding an office in an international organisation compels that conclusion. Put simply, to focus on whether an office in an international organisation is permanent or filled by successive holders (or both) is to define the concept of "office" within the meaning of s 6(1)(d)(i) of the IOPI Act by reference to criteria that are not relevantly applicable to the holding of an office in an international organisation. Rather, on its proper construction, s 6(1)(d)(i) (as well as s 6(1)(b)(i)) is concerned with the incidents of the relationship between a person and an international organisation – a person who "holds an office in" an international organisation. The incidents of that relationship will depend on the terms upon which a person is engaged. Examination of those terms may lead to the conclusion that a person holds an office in an international organisation that is neither permanent nor filled by successive holders. The centrality of the terms of engagement to the inquiry required by s 6(1)(d)(i) reflects the fact that the IOPI Act can, and does, apply to a variety of international organisations. Different international organisations engage staff in different ways, depending on the governing instruments of the particular international organisation. Typically, those instruments set out, in very general terms, how "staff" are to be engaged and the scope of their duties. The Charter of the United Nations itself illustrates the point: it provides that "[t]he staff shall be appointed by the Secretary-General under regulations established by the General Assembly"26. Similarly, the Director-General of the World Trade Organization "shall appoint the members of the staff of the Secretariat and determine their duties and conditions of service in accordance with regulations adopted by the Ministerial Conference"27. The Secretary-General of the Organisation for Economic Co-operation and Development "shall appoint such staff as the Organisation may require in accordance with plans of organisation approved by 26 Art 101(1) of the Charter of the United Nations [1945] ATS 1. 27 Art VI:3 of the Marrakesh Agreement establishing the World Trade Organization [1995] ATS 8. See World Trade Organization (Privileges and Immunities) Regulations 1996 (Cth). Gordon Edelman the Council"28. In other words, instruments governing international organisations are not prescriptive about the incidents of the relevant relationships. The heads of international organisations tend to have a broad discretion as to how staff will be engaged and on what terms. An international organisation may establish a relationship between it and the relevant person such that the person holds an "office", but there is nothing that requires that "office" to align with the understanding of "office" expressed by Rowlatt J in Bater. It is for the international organisation to define the incidents of the relationship between it and the relevant person. That is not to adopt the Commissioner's contention that the phrase "a person who holds an office in an international organisation" in s 6(1)(d)(i) of the IOPI Act and the similar phrase in reg 10(1) of the UN Regulations should be construed as referring to a person who holds a position that the UN has "established and designated" as an office. That is not the question posed by s 6(1)(d)(i) of the IOPI Act. In ascertaining whether a person "holds an office in" an international organisation, s 6(1)(d)(i) is concerned with the incidents of the relationship between a person and an international organisation. It focuses on the substance of the terms upon which a person is engaged – not whether the relevant organisation has attributed a particular label to the engagement – and on the relationship between that engagement and the organisation's performance of its functions. The phrase "a person who holds an office in an international organisation" directs attention to the structure of the organisation and the place of the person within it. The holder of an "office" in such an organisation may be expected to have a position to which certain duties attach29, duties relating to the performance of the organisation's functions and a level of authority with respect to the organisation. The position of the person within the international organisation and the duties and authority associated with it should render explicable why the privileges and immunities are conferred. By comparison, a person whose terms of engagement place them outside the organisational structure, and do not provide that person with any defined duties or authority with respect to the organisation and its functions, could hardly be said to hold an office within the organisation. 28 Art 11(1) of the Convention on the Organisation for Economic Co-operation and Development [1971] ATS 11. See Organisation for Economic Co-operation and Development (Privileges and Immunities) Regulations 1983 (Cth). 29 See R v Boston (1923) 33 CLR 386 at 402; [1923] HCA 59. Gordon Edelman The construction of s 6(1)(d)(i) explained above is reinforced by s 6(2)(b) of the IOPI Act, which relevantly provides that regulations made for the purposes of s 6 may relate to "particular offices or classes of offices". Moreover, that construction is consistent with the statutory purpose or purposes of the IOPI Act30. In particular, that construction is consistent with the purpose of conferring the privileges and immunities in the way the IOPI Act does: that conferral is not for the benefit of, or personal to, the persons connected with an international organisation, but is rather to assist the international organisation in the "performance of [its] functions"31. That purpose of "functional necessity"32 is itself reinforced by the inclusion in the IOPI Act33 and, relevantly here, the UN Regulations34 of a provision allowing for the waiver of any privileges and immunities to which an international organisation or a person is entitled by reason of the IOPI Act or the regulations made under it. For present purposes, it is the Secretary-General of the UN who may waive any privilege or immunity to which a person who holds an office in the UN is entitled under the IOPI Act and the UN Regulations. Further, the construction explained above accords with Australia's international obligations under the 1946 UN Convention35. That construction recognises a distinction between creating an office that attracts privileges and immunities under s 18 in Art V, engaging an expert on mission who attracts different privileges and immunities under s 22 in Art VI, and engaging a person to perform a task or tasks who does not attract privileges and immunities. For example, the privileges and immunities under Pt I of the Fourth Schedule to the IOPI Act36 conferred on a person who holds an office in the UN reflect those conferred on officials of the UN under s 18 in Art V of the 1946 UN Convention. And the different set of privileges and immunities under Pt I of the 30 See Macoun (2015) 257 CLR 519 at 535 [54]. 31 Macoun (2015) 257 CLR 519 at 535 [54]. 32 Macoun (2015) 257 CLR 519 at 535 [54]. 33 s 10 of the IOPI Act. 34 reg 12(2) of the UN Regulations. 35 See, eg, Macoun (2015) 257 CLR 519 at 539 [67] and the authorities cited. 36 See reg 10(1) of the UN Regulations. Gordon Edelman Fifth Schedule to the IOPI Act37 conferred on a person performing a mission on behalf of the UN reflects those accorded to experts performing missions for the UN (other than UN officials falling within Art V) under s 22 in Art VI of the 1946 UN Convention. Finally, the nature of the privileges and immunities conferred reinforces the above construction. A person performing a mission is entitled to inviolability of papers and documents under s 6(1)(e)(i) and cl 3 of Pt I of the Fifth Schedule to the IOPI Act38, consistent with the position of experts performing missions under s 22(c) in Art VI of the 1946 UN Convention. By contrast, the holder of an office within the meaning of s 6(1)(d)(i), consistent with the position of an official under s 18 in Art V of the 1946 UN Convention, will not be so entitled. Conversely, a tax exemption is conferred on the holder of an office under s 6(1)(d)(i) and cl 2 of Pt I of the Fourth Schedule to the IOPI Act39, consistent with s 18(b) in Art V of the 1946 UN Convention, but such a privilege is not conferred on a person performing a mission within the meaning of s 6(1)(e)(i)40, which is again consistent with the terms of the 1946 UN Convention. Mr Jayasinghe So, what were the incidents of the relationship between Mr Jayasinghe and the UN? During the relevant period, did he "hold[] an office in" the UN within the meaning of s 6(1)(d)(i)? The answer to the latter question is "no". The Individual Contractor Agreement is determinative. As seen earlier, that agreement provided in its terms that: (1) Mr Jayasinghe was engaged in his individual capacity to undertake a non-core function – "to perform a specific task or deliver a specific piece of work", namely "[c]ompletion of the road … on time and under budget"; 37 See reg 11(1) of the UN Regulations. 38 See reg 11(1) of the UN Regulations. 39 See reg 10(1) of the UN Regulations. 40 Regulation 11(1) of the UN Regulations does not refer to cl 2A of Pt I of the Fifth Schedule to the IOPI Act, which reads "[e]xemption from taxation on salaries and emoluments received from the organisation". Gordon Edelman upon certification that his services as a project manager had been satisfactorily performed Individual Contractor Agreement, Mr Jayasinghe was to be paid a monthly fee by UNOPS; in accordance with the (3) Mr Jayasinghe had the legal status of an independent contractor of UNOPS, serving in his individual capacity and with no authority or other right to enter into any legal or financial commitments or incur any obligations on behalf of UNOPS; (4) Mr Jayasinghe did not have the status of an official of the UN for the purposes of the 1946 UN Convention – in fact, at least from 1 May 2010, he was considered an expert on mission for the UN within the terms of s 22 in Art VI of the 1946 UN Convention and was accorded, by the UN, the privileges and immunities provided for in s 22 in Art VI of the 1946 UN Convention; (5) Mr Jayasinghe was responsible for paying any tax levied by the Australian Government on his UNOPS earnings, contrary to s 6(1)(d)(i) of the IOPI Act and reg 10(1) of the UN Regulations; and (6) Mr Jayasinghe was solely liable for claims by third parties arising from his own negligent acts or omissions in the course of his service under the Individual Contractor Agreement, contrary to s 6(1)(d)(i) of the IOPI Act and reg 10(1) of the UN Regulations. For those reasons, Mr Jayasinghe did not hold an office in the UN within the meaning of s 6(1)(d)(i) of the IOPI Act. The Administration Act Part 5-5 of Sched 1 to the Administration Act, titled "Rulings", comprises a number of divisions. This appeal is concerned with Div 357, titled "Object and common rules". Section 357-5, titled "Object of this Part", provides that: "(1) The object of this Part is to provide a way for you to find out the Commissioner's view about how certain laws administered by the Commissioner apply to you so that the risks to you of uncertainty Gordon Edelman when you are self assessing or working out your tax obligations or entitlements are reduced. This object is achieved by: (a) making advice in the form of rulings by the Commissioner available on a wide range of matters and to many taxpayers; and ensuring that the Commissioner provides rulings in a timely manner; and enabling the Commissioner to obtain, and make rulings based on, relevant information; and protecting you from increases in tax and from penalties and interest where you rely on rulings; and protecting you from decreases in entitlements where you rely on rulings; and limiting the ways the Commissioner can alter rulings to your detriment; and giving you protection from interest charges where you rely the Commissioner, or on the on other advice from Commissioner's general administrative practice." There was no dispute that a ruling issued by the Commissioner is to be construed by reference to that object41. And consistent with that object, s 357-60(1), titled "When rulings are binding on the Commissioner", is one of the common rules that apply to all rulings issued by the Commissioner. It relevantly provides that: "[A] ruling binds the Commissioner in relation to you (whether or not you are aware of the ruling) if: the ruling applies to you; and 41 See Jayasinghe (2016) 103 ATR 357 at 374 [55]; see also at 366 [38]. Gordon Edelman you rely on the ruling by acting (or omitting to act) in accordance with the ruling." The ruling TD 92/153 is a public ruling42 issued by the Commissioner. It relevantly provides that: received Salaries and emoluments international organisation by a person who holds an office in that organisation may be exempt from Australian income tax under regulations made under [the IOPI Act]. The availability and extent of exemption varies from organisation to organisation, and in this regard individual regulations should be consulted. The question arises, however, who is a 'person who holds an office' for the purposes of the regulations under [the IOPI Act]. from an The Department of Foreign Affairs and Trade, who administer [the IOPI Act] and regulations, take the view that the phrase 'person who holds an office' in relation to a prescribed international organisation covers those people who work as employees for that organisation. They do not accept, however, that the phrase includes either: persons who are locally engaged by the organisation and paid at an hourly rate; or persons engaged by consultants. the organisation as experts or We agree with those views. In determining whether a person holds an office, the relevant international organisation is required to apply these tests. As a practical matter, if the international organisation designates a person as one who holds an office in that organisation, we will accept, in the absence of contrary evidence, that this designation is sufficient evidence of the status of that person. If the other requirements of the regulations are satisfied, that person will be entitled to the privileges and immunities available to a person who holds an office in that organisation." (emphasis in original) 42 See Div 358 in Pt 5-5 of Sched 1 to the Administration Act. See also Bellinz v Commissioner of Taxation (1998) 84 FCR 154 at 168-169. Gordon Edelman The Tribunal found that Mr Jayasinghe was "a person who worked as an employee" of UNOPS, was not engaged as an expert or consultant and was therefore entitled to the benefit of TD 92/15343 (emphasis in original). The Tribunal concluded that Mr Jayasinghe was not engaged as an expert or consultant because his duties as a project manager were not confined to "advis[ing] or giv[ing] opinions from time to time as to the implementation, design or progress of the [road works]", but rather included "managerial, administrative, negotiation, supervision and numerous other activities"44. The majority of the Full Court concluded that TD 92/153 was "not to be read as removing from the class of persons working as employees, those persons who both work as employees and are engaged as experts and consultants"45. Accordingly, without needing to determine whether Mr Jayasinghe was engaged as an expert, the majority concluded that, because Mr Jayasinghe worked as an employee, he was entitled to the benefit of the ruling46. Commissioner not bound to exempt Mr Jayasinghe On appeal to this Court, the Commissioner did not contest the finding of the Tribunal, upheld on appeal by all members of that Mr Jayasinghe was an employee. Rather, the question for this Court was whether, although he was found to be an employee, Mr Jayasinghe otherwise fell outside the scope of the phrase "person who holds an office" for the purposes of TD 92/153 because he was engaged by UNOPS as an expert. TD 92/153 is addressed to taxpayers who need to determine whether they are to be assessed on salaries and emoluments received from a relevant international organisation and, in particular, whether they are to be assessed on the basis that they hold an office in a relevant international organisation. As the words of par 2 of the ruling suggest, the phrase "person who holds an office" does not include persons who fall into either of the two listed 43 Jayasinghe (2015) 101 ATR 476 at 483 [54]. 44 Jayasinghe (2015) 101 ATR 476 at 484 [57]. 45 Jayasinghe (2016) 103 ATR 357 at 375 [56]. 46 Jayasinghe (2016) 103 ATR 357 at 375 [57]. 47 Jayasinghe (2016) 103 ATR 357 at 367 [38], 375 [57]. Gordon Edelman categories. Therefore, on its natural reading, TD 92/153 provides that a person who works as an employee for a relevant international organisation will not be a "person who holds an office" if that person is also either locally engaged by the organisation and paid at an hourly rate or engaged by the organisation as an expert or a consultant. In other words, if a person falls into one of the two listed categories, they will not be a "person who holds an office" under TD 92/153 – whether they are also an employee is beside the point. The correctness of this construction can be tested by considering the alternative construction adopted by the majority of the Full Court. On that construction, whether a person holds an office in an international organisation is determined solely by the criterion in the first sentence of par 2 – whether the person is an "employee". That construction raises the question: if all that matters to the analysis of whether a person is one who "holds an office" is whether they are an employee, why are the two categories listed in par 2 included at all? Whether a person is engaged as an expert or a consultant would be of no practical consequence – put simply, those categories would not serve any purpose. The majority of the Full Court sought to address that concern. Their Honours considered that the balance of par 2 is simply an attempt to explain that persons falling within the two listed categories would not "ordinarily" be working as an employee48. However, it is not necessarily the case that persons who are locally engaged and paid at an hourly rate, or engaged as experts or consultants, are not "ordinarily" regarded as employees. Paragraph 2 cannot be read in the way that the majority did. Nothing in the terms of the ruling suggests that the two listed categories are to be treated as surplusage, "helpful" or otherwise. To the contrary, par 2 is in terms that a person who answers one of those two descriptions is not included within the phrase "person who holds an office". Here, as seen above, although the Tribunal found that Mr Jayasinghe was an employee but not engaged as an expert, he was engaged to perform "specialist services" and, at least from 1 May 2010, he was considered an expert on mission within the terms of s 22 in Art VI of the 1946 UN Convention49. The terms of Mr Jayasinghe's engagement cannot be ignored for the purposes of TD 92/153. On that basis, he fell within one of the categories listed in par 2 of 48 Jayasinghe (2016) 103 ATR 357 at 375 [56]. 49 See [12]-[13], [42(4)] above. Gordon Edelman Notice of contention On appeal to this Court, Mr Jayasinghe did not rely on the reasoning of the majority of the Full Court. Mr Jayasinghe filed a notice of contention contending that the decision of the Full Court should be upheld but on the ground that: on the proper construction of … TD 92/153, the phrase 'persons engaged by the organisation as experts or consultants' is a reference to persons 'who work as employees for that organisation' and are the principal purpose of engaged by performing the role of expert or consultant and not for a principal purpose of performing a different role, and the organisation for on the facts as found by the Tribunal, [Mr Jayasinghe] was engaged not to perform the role of expert or consultant but to perform the role of Project Manager, and in consequence that [the Commissioner] was bound by the public ruling to assess [Mr Jayasinghe] as a person who held [an] office in [the UN] for the purposes of s 6(1)(d) of [the IOPI Act] and reg 10 of [the UN Regulations]." Put in different terms, Mr Jayasinghe did not advance a construction of TD 92/153 inconsistent with the construction explained above, but he contended that he was not engaged as an expert within the meaning of TD 92/153. That contention should be rejected. As the Commissioner submitted, whether or not Mr Jayasinghe was engaged as an expert within the meaning of TD 92/153 depended on the terms of his engagement. The terms of Mr Jayasinghe's Individual Contractor Agreement were and remain determinative. As explained above, an examination of those terms reveals that he was engaged as an expert to perform "specialist services" in recognition of his "skills and expertise" and to perform the functional role of "Project Manager". On the facts of the present case, there is no inconsistency between being engaged as an expert and performing the functional role of "Project Manager". Accordingly, on the proper construction of TD 92/153, the Commissioner was not bound to exempt Mr Jayasinghe from taxation on the income he received from UNOPS during the relevant income years. Gordon Edelman Orders The appeal should be allowed. The order of the Full Court made on 9 June 2016 should be set aside, and in its place it should be ordered that the appeal to that Court be allowed, and that the decision of the Tribunal made on 29 June 2015 be set aside and in its place it be ordered that the decision under review be affirmed. It is unnecessary to make an order as to costs in light of the Commissioner's undertaking to pay Mr Jayasinghe's costs in this Court. GAGELER J. What presents as a specific question about exemption from taxation is also a more general question about entitlement to the range of privileges and immunities specified in the Fourth Schedule to the IOPI Act. The question is whether, by reason of engagement by UNOPS under an Individual Contractor Agreement, a person answers the description of "a person who holds an office" in the UN within the meaning of the UN Regulations, made under the IOPI Act. The meaning of "office", like the meaning of most if not all other words, "turns largely on the context in which it is found"50. The context of the word in the UN Regulations includes principally the IOPI Act as well as the two principal international instruments in respect of which the IOPI Act is designed to facilitate performance of Australia's international obligations: the Convention on the United Nations ("the Privileges the Privileges and Immunities of Convention") and the Convention on the Privileges and Immunities of the Specialized Agencies ("the Agencies Convention")51. The language of the description in the UN Regulations is taken from the language of the IOPI Act and therefore has the same meaning as that language has in that Act52. Within the IOPI Act, the language is used to describe the second of three categories of persons who have an ongoing connection with an international organisation to which the IOPI Act applies sufficient to be capable of attracting entitlement by regulation to a corresponding range of privileges and immunities specified in diminishing order of coverage in the Second, Fourth and Fifth Schedules to the IOPI Act. The three categories are: "a person who holds, or is performing the duties of, an office prescribed by the regulations to be a high office in [the] international organisation"53; 50 Sykes v Cleary (1992) 176 CLR 77 at 96-97; [1992] HCA 60. 51 See generally Macoun v Federal Commissioner of Taxation (2015) 257 CLR 519; [2015] HCA 44. 52 Section 13(1)(b) of the Legislation Act 2003 (Cth). 53 Section 6(1)(b)(i) of the IOPI Act. "a person who holds an office in [the] international organisation ... (not being an office prescribed by the regulations to be a high office)"54; and "a person who is serving on a committee, or is participating in the work, of [the] international organisation ... or is performing, whether alone or jointly with other persons, a mission on behalf of [the] organisation"55. The contrast in the expression between the references in the first two of those categories to a person holding office "in" the international organisation and the reference in the third to participating in the work "of" the international organisation indicates that an office within the meaning of the IOPI Act is a position which exists within the organisational structure of the international organisation. A person may be participating in the work of the international organisation without holding an office in the organisation, just as a person may be performing a mission on behalf of the organisation without holding an office in the organisation. The contrast in the expression within the first category between holding an office and performing the duties of an office indicates two further things about an office within the meaning of the IOPI Act. The first is that an office is a position which exists independently of the person who from time to time might hold it. The second is that an office is a position to which duties attach. Those three features of an office within the meaning of the IOPI Act – that it is a position which exists within the organisational structure of the international organisation, that it is a position which exists independently of the person who from time to time might hold it, and that it is a position to which duties attach – align the statutory concept of a person who holds an office to the concept under the Privileges Convention and the Agencies Convention of a person who is an "official" of an international organisation as distinct from an "expert on mission". Of the category of "experts on mission", as distinct from "officials", within the meaning of the Privileges Convention, the International Court of Justice has noted that the category has in international practice been treated as covering persons who have "participated in certain peacekeeping forces, technical assistance work, and a multitude of other activities", and has stated56: 54 Section 6(1)(d)(i) of the IOPI Act. 55 Section 6(1)(e)(i) of the IOPI Act. 56 Applicability of Article VI, Section 22, of the Convention on the Privileges and Immunities of the United Nations, Advisory Opinion, [1989] ICJ Reports 177 at 194 [47]-[48]. See also Difference Relating to Immunity from Legal Process of a (Footnote continues on next page) "The experts thus appointed or elected may or may not be remunerated, may or may not have a contract, may be given a task requiring work over a lengthy period or a short time. The essence of the matter lies not in their administrative position but in the nature of their mission." The three features of an office within the meaning of the IOPI Act which I have identified are not adequately captured by the test drawn from Great Western Railway Co v Bater57 adopted and applied by the Tribunal58 and approved by the majority in the Full Court of the Federal Court59. When those three features are borne in mind, it is apparent not only that the Tribunal applied the wrong test but that the conclusion that his engagement by UNOPS under an Individual Contractor Agreement led Mr Jayasinghe to answer the description of a person who holds an office in the UN within the meaning of the UN Regulations was not open. Moreover, as the factual analysis of the plurality demonstrates, Mr Jayasinghe's engagement was as an expert. The contrary finding of the Tribunal was not open. As an expert, as the legal analysis of the plurality demonstrates, Mr Jayasinghe was excluded from the scope of the relevant public ruling properly construed. I agree with the orders proposed by the plurality. Special Rapporteur of the Commission on Human Rights, Advisory Opinion, [1999] ICJ Reports 62 at 82-83 [42]. 57 [1920] 3 KB 266 at 274. 58 Re Jayasinghe and Federal Commissioner of Taxation (2015) 101 ATR 476 at 481 59 Federal Commissioner of Taxation v Jayasinghe (2016) 103 ATR 357 at 370 [47].
HIGH COURT OF AUSTRALIA MINISTER FOR IMMIGRATION AND BORDER PROTECTION APPELLANT AND SZSCA & ANOR RESPONDENTS Minister for Immigration and Border Protection v SZSCA [2014] HCA 45 12 November 2014 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation G T Johnson SC with J D Smith for the appellant (instructed by Australian Government Solicitor) S B Lloyd SC with P D Reynolds for the first respondent (instructed by Fragomen) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Immigration and Border Protection v SZSCA Migration – Refugees – Application for protection visa – Where applicant threatened by Taliban – Where Refugee Review Tribunal affirmed decision not to grant protection visa because risk of persecution would only arise on roads outside Kabul, which applicant could avoid – Whether Refugee Review Tribunal fell into error identified in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473; [2003] HCA 71 – Whether Refugee Review Tribunal failed to address whether it would be reasonable to expect applicant to remain in Kabul. Words and phrases – "internal relocation principle", "live discreetly", "real chance of persecution", "reasonable to expect", "well-founded fear of persecution". Migration Act 1958 (Cth), s 36(2)(a). Convention relating to the Status of Refugees (1951) as amended by the Protocol relating to the Status of Refugees (1967), Art 1A(2). FRENCH CJ, HAYNE, KIEFEL AND KEANE JJ. The first respondent ("the respondent") is a citizen of Afghanistan, of Hazara ethnicity, from the Jaghori district in the Ghazni province. He arrived in Australia by boat on 21 February 2012 and subsequently applied for a protection visa. In his application the respondent said that he and his immediate family have lived in Kabul since 2007 and that he has worked as a self-employed truck driver since that time. Prior to that, he worked in Jaghori manufacturing jewellery. The respondent said that his work as a truck driver required him to drive between Kabul, Ghazni and Jaghori. From about January 2011, he began to specialise in the transportation of construction materials between Kabul and Jaghori because it provided him with a higher income. Around late January 2011, the respondent was en route to Jaghori when he was stopped by the Taliban, who warned him not to carry construction and building materials. The respondent explained, in a submission to the Refugee Review Tribunal ("the Tribunal"), that the Taliban considered that, by transporting such materials, he was acting for the government or for foreign organisations. He was released because he said that he was carrying the materials for a shopkeeper and, in his view, because this particular group was "more merciful than other Taliban". Thereafter, he took measures to avoid Taliban checkpoints, although he continued to carry construction materials. In about November 2011, another Hazara truck driver showed the respondent a letter he had been given by the Taliban ("the Taliban letter"). The Taliban letter, a translated copy of which was produced to the Tribunal, was headed "Islamic Emirate of Afghanistan, Ghazni Province, Khogyani District". It alleged that the respondent was "assisting and cooperating with government and foreign organisations in the transportation of logistical and construction materials from Ghazni city to Jaghori and to Malestan district." It called upon "local council people to perform their Islamic duty ... to get rid of this criminal, infidel person." It told them "to take firm action as soon as possible to get rid of this apostate, criminal person on the road from Qarabagh and Janda areas." The respondent said that he decided then to leave Afghanistan and did so 10 days later. The respondent's application for a protection visa was refused by a delegate of the appellant. That decision was affirmed by the Tribunal. Given the nature of the issues on this appeal, it is necessary to refer to the findings of the Tribunal in some detail. Hayne The respondent told the Tribunal that he feared that, if he returned to Afghanistan, he would be abducted, abused and/or killed by the Taliban. He also feared that he would be deprived of his ability to make a living. His fears of mistreatment or harm had three bases: his Hazara ethnicity and Shia religion; his membership of a particular social group, namely truck drivers who transport goods for foreign agencies; and his imputed and actual political opinion supportive of foreign agencies. The Tribunal was not satisfied that the Taliban targets Hazara Shias on a systematic and discriminatory basis, or that Afghan truck drivers are persecuted by reason only of their occupation. Nonetheless, the Tribunal accepted that the Taliban generally targets drivers carrying construction materials and discourages them from doing so, and that the Taliban may impute to persons undertaking that activity political opinions supportive of the Afghan government or non- governmental aid organisations. The Tribunal considered it to be quite plausible that the respondent had been warned to desist from such activity. The Tribunal proceeded upon the basis that the Taliban letter was genuine and that the respondent was threatened by it. It accepted that, if the respondent was again intercepted by the Taliban on the roads on which he usually travelled, he would face a real chance of serious harm and even death for a reason specified in the Refugees Convention1 ("the Convention"), namely the political opinion imputed to him. The Tribunal considered the risk of harm would be greater if he were carrying construction materials. The Tribunal does not appear to have dealt with the matter on the basis of the respondent's claim that, in fact, he held that political opinion. Nor does the Tribunal appear to have attached significance to the description of the respondent in the Taliban letter as an apostate. However, these omissions are not presently in issue. The Tribunal did not accept that the respondent is a high-profile target who would be actively pursued by the Taliban throughout Afghanistan. It viewed him as someone who might be harmed if he came to the Taliban's attention, which would likely only occur if he continued to transport construction materials. There was evidence that the Taliban does not actively pursue and target low-profile persons in Kabul. The area in which the respondent lived in Kabul was predominantly Hazara, where enquiries by the Taliban as to his whereabouts would be conspicuous. 1 Convention relating to the Status of Refugees (1951) as amended by the Protocol relating to the Status of Refugees (1967). Hayne The Tribunal observed that, as late as June 2012, the Taliban did not appear to know the respondent's whereabouts. This observation appears to have been drawn from the respondent's statement that, at that time, his brother had advised him that the Taliban was asking about the respondent's whereabouts, having noticed that he was no longer driving on the roads between Kabul and Jaghori. However, this enquiry might also be thought to suggest a level of interest in the respondent on the part of the Taliban. The focus of the Tribunal's determination was upon security in Kabul, which it considered to be "relatively good". It concluded that it was not satisfied that the respondent would face a real chance of persecution if he remained there. It found that the risk of persecution would only arise in the area constituted by the roads on which he had been driving outside of Kabul, and he could avoid this area. It followed that the respondent did not satisfy the criterion for the grant of a protection visa set out in s 36(2)(a) of the Migration Act 1958 (Cth). At a practical level, the Tribunal was of the view that the respondent would not be obliged to travel between Kabul and Jaghori to make a living. It was satisfied that the respondent could obtain employment in Kabul, such as in making jewellery, as he had formerly done in Jaghori. The detailed account of the hearings before the Tribunal, which is contained in the Tribunal's reasons, does not suggest that this matter was put to the respondent by the Tribunal. On the respondent's application to review the Tribunal's decision, the Federal Circuit Court of Australia (Judge Nicholls) ordered that the decision be quashed and that the matter be remitted for determination according to law2. A majority of a Full Court of the Federal Court of Australia (Robertson and Griffiths JJ, Flick J dissenting) dismissed an appeal from the Federal Circuit Court's decision3. The decisions of the Federal Circuit Court and the majority in the Federal Court referred4 to what was said in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs5 as relevant to this matter. In that case the 2 SZSCA v Minister for Immigration and Citizenship [2013] FCCA 464. 3 Minister for Immigration and Border Protection v SZSCA (2013) 222 FCR 192. 4 SZSCA v Minister for Immigration and Citizenship [2013] FCCA 464 at [101], [107]-[108]; Minister for Immigration and Border Protection v SZSCA (2013) 222 FCR 192 at 207-209 [51]-[56], 210-211 [61]-[62]. (2003) 216 CLR 473; [2003] HCA 71. Hayne Tribunal had accepted that it was not possible for the protection visa applicants to live openly as homosexuals in Bangladesh, but found that they had conducted themselves discreetly and there was no reason to suppose that they would not continue to do so if they returned to that country. Four members of this Court held that, by reasoning in this way, the Tribunal failed to consider the question it had to decide – whether the applicants had a well-founded fear of persecution6. The question for the Tribunal was whether there was a real chance that, upon return to Bangladesh, the applicants would be persecuted for a Convention reason7. This had not been addressed. In the later case of SZATV v Minister for Immigration and Citizenship8, Kirby J said that the two majority judgments in S395 both spoke of the need for the decision-maker to focus attention on the propounded fear of the applicant for a protection visa and whether it was well founded; and to consider that issue on an individual basis and by reference to the individual applicant, not by reference to a priori reasonable conduct, such as living discreetly, which might reduce the risk of persecution. Gummow and Hayne JJ had said in S395 that it is irrelevant to the enquiry whether a fear of persecution is well founded to say that the applicant is to be expected to live discreetly9. The essential reasoning in S395 was that the Tribunal had diverted itself from its task of determining whether there would be a real chance that the applicants would be persecuted if they returned to Bangladesh, by focusing on an assumption about how the risk of persecution might be avoided. Gummow and Hayne JJ said that the enquiry was what might happen if the applicants returned, not whether adverse consequences could be avoided10. It followed that the issue 6 Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473 at 489 [39] per McHugh and Kirby JJ, 501 [82], 503 [88] per 7 Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473 at 490 [43] per McHugh and Kirby JJ, 498-499 [72] per Gummow (2007) 233 CLR 18 at 45 [89]; [2007] HCA 40. 9 Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473 at 501 [82]. 10 Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473 at 500 [80]. Hayne to which the correct enquiry was directed – whether the fear of persecution was well founded – had not been addressed. In the present case the Tribunal did not fall into the error identified in S395. The critical aspect of the reasoning of the Tribunal in the present case was its finding that the respondent would not face a real chance of persecution if he remained in Kabul and did not travel on the roads between Kabul and Jaghori. The Tribunal found that he would suffer a real chance of harm for a Convention reason if he carried construction material in another area, but that he was safe in Kabul. In contrast to S395, therefore, the Tribunal did not divert itself from the question of whether the respondent would face a real chance of persecution if he returned to Afghanistan. This matter also differs from S395 in that the risk of persecution claimed in that case was general and nationwide. The occasion for consideration of whether the applicants could be safe from harm in a particular area of Bangladesh did not arise. In this case the risk of harm was specific to an area. In this matter the Tribunal did not consider that the issue of relocation arose as such, for the reason that the respondent already resided in Kabul, the place where he was considered to be relatively safe. However, as will be explained, the same considerations as are relevant to relocation apply when the Tribunal identifies an area where the visa applicant may be safe, so long as he or she remains there. The "internal relocation principle" is well established. According to this principle, a person is not a refugee within the meaning of the Convention if he could avail himself of the real protection of his country of nationality by relocating to another part of that country. The connection of the principle to the definition of a refugee in the Convention, and the conditions for the principle's application, were explained by this Court in SZATV11. In that case the Tribunal refused to grant a protection visa because it determined that the visa applicant, a Ukrainian journalist who had suffered persecution for his political opinions, could relocate to another region of Ukraine, even though he might not be able to continue to work there as a journalist. The Tribunal failed to consider what 11 (2007) 233 CLR 18; see also SZFDV v Minister for Immigration and Citizenship (2007) 233 CLR 51 at 55 [14]; [2007] HCA 41. Hayne might reasonably be expected of the applicant with respect to relocation, which this Court held was an error of law12. In SZATV, Gummow, Hayne and Crennan JJ observed that the Convention definition of a refugee is drawn into Australian law by s 36(2) of the Migration Act13, which provides the criteria for granting a protection visa. Their Honours added that any principle respecting internal relocation must therefore be distilled from the text of the Convention14. The critical portion in Art 1A(2) of the Convention states that the term "refugee" applies to any person who: "owing to well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion, is outside the country of his nationality and is unable or, owing to such fear, is unwilling to avail himself of the protection of that country ..." Their Honours accepted15 as correct the explanation given by Lord Bingham of Cornhill in Januzi v Secretary of State for the Home Department16 as to how the internal relocation principle finds its place in the Convention. Whilst Art 1A(2) does not make express reference to relocation, in the sense of there being a place within a person's country where he or she could reasonably be expected to relocate, such a restriction on the Convention's protection may be seen to arise from the causative condition expressed in the definition of "refugee". If a person could have relocated to a place within his own country where he could have no well-founded fear of persecution, and where he could reasonably be expected to relocate, then the person is outside the country of his nationality because he has chosen to leave it and seek asylum in another country. He is not outside his country owing to a well-founded fear of persecution for a Convention reason. The person is not, within the Convention definition, a refugee. In this case the respondent submitted that, in SZATV, this Court did not consider an alternative explanation of the internal relocation principle to that 12 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 29 [32]. 13 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 23 [12]. 14 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 24 [15]. 15 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 25 [19]. 16 [2006] 2 AC 426 at 440 [7]. Hayne proposed in Januzi. On this alternative approach, a person who can reasonably relocate to a safe area within his country remains a refugee, but he may nevertheless be returned to the safe area without Art 33(1) of the Convention, which relates to non-refoulement, being breached. It is true that this argument does not appear to have been considered by the Court in SZATV; however, this is not sufficient reason to reconsider that decision. None of the conditions referred to in John v Federal Commissioner of Taxation17 is present. The factum upon which the principle of relocation operates is that there is an area in the visa applicant's country of nationality where he or she may be safe from harm. In this matter it was found by the Tribunal that Kabul was such a place. By analogy with the internal relocation principle, given the existence of a place within his country of nationality where the respondent would have no well- founded fear of persecution, it could not be concluded that he is outside Afghanistan and unable to return to that country owing to a well-founded fear of persecution if it could reasonably be expected that he remain in Kabul and not travel outside it. As in SZATV, it is the question of what may reasonably be expected of the respondent which must be addressed. The UNHCR Handbook18 recognises that persecution of a particular group may occur in only one part of a country, and that in such situations a person will not be excluded from refugee status merely because he could have sought refuge in another part of the country, if in all the circumstances it would not have been reasonable to expect him to do so. In Januzi19, Lord Bingham, in an observation referred to in SZATV20, said that the corollary of this proposition is that a person will be excluded from refugee status if, in all the circumstances, it would be reasonable to expect him to relocate to another part of the same country. 17 (1989) 166 CLR 417 at 438-439; [1989] HCA 5. 18 United Nations High Commissioner for Refugees, Handbook on Procedures and Criteria for Determining Refugee Status under the 1951 Convention and the 1967 Protocol relating to the Status of Refugees, (1979, reedited 1992) at [91]. 19 [2006] 2 AC 426 at 440 [7]. 20 (2007) 233 CLR 18 at 26 [22]. Hayne In SZATV the Minister submitted that what is "reasonable" in this context is to be equated with what is "practicable"21. Gummow, Hayne and Crennan JJ accepted this submission, but added22: "However, that does not mean that, without more, the formulation by the Minister is sufficient and satisfactory. What is 'reasonable', in the sense of 'practicable', must depend upon the particular circumstances of the applicant for refugee status and the impact upon that person of relocation of the place of residence within the country of nationality." In SZATV the effect of the Tribunal's decision was that the applicant was expected to move to another region of Ukraine and live "discreetly" so as not to attract attention23. It was observed that, in S395, the notion that the applicants could avoid persecution by living "discreetly" had been rejected24. In SZATV it was held25 that the Tribunal had sidestepped consideration of what might reasonably be expected of the applicant with respect to his relocation. This presented an error of law going to an essential task of the Tribunal – determining whether the applicant's fear of persecution was well founded in the Convention sense, and thus also for the purposes of s 36(2)(a) of the Migration Act. The Tribunal in this case did not consider that the internal relocation principle applied, because the respondent already lived in Kabul. The Tribunal therefore did not consider the question whether the respondent could reasonably be expected to remain there and not transport materials on the roads outside Kabul, where he would be at risk of harm. This was an incorrect approach. Although the respondent had lived in Kabul since 2007, he had not been confined to that area and his work had taken him outside it. An expectation that he now remain within Kabul raises considerations analogous to those with which the internal relocation principle is concerned – specifically, whether such an expectation is reasonable. 21 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 26 [23]. 22 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 27 [24]. 23 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 29 [32]. 24 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 28 [28]. 25 SZATV v Minister for Immigration and Citizenship (2007) 233 CLR 18 at 29 [32]. Hayne In Januzi26, the House of Lords approved the approach of the Court of Appeal in E v Secretary of State for the Home Department27 as to the nature of the test to be applied to determine whether an asylum seeker could reasonably be expected to move to a safe haven within his or her country of nationality – that is, to internally relocate. In the respects relevant to this matter, the Court of Appeal said28: "Relocation in a safe haven will not provide an alternative to seeking refuge outside the country of nationality if, albeit that there is no risk of persecution in the safe haven, other factors exist which make it unreasonable to expect the person fearing persecution to take refuge there ... Where the safe haven is not a viable or realistic alternative to the place where persecution is feared, one can properly say that a refugee who has fled to another country is 'outside the country of his nationality by reason of a well-founded fear of persecution'." The nature of the test was said29 to involve "a comparison between the conditions prevailing in the place of habitual residence and those which prevail in the safe haven, having regard to the impact that they will have on a person with the characteristics of the asylum seeker." In the present case it is not just the living conditions for the respondent in Kabul – and whether he would face a real chance of persecution if he stayed there – which should have been considered by the Tribunal. Rather, it was necessary for the Tribunal to consider the impact on the respondent of remaining in Kabul and not driving trucks on the roads he usually frequented in the course of his business. Addressing this question properly may have raised various issues for the Tribunal's consideration. At the least, the question clearly directs attention to the respondent's ability to earn an income from other sources and to his needs and those of his family. The Tribunal did not address this question. It did not address what was necessary to an enquiry whether it was reasonable to expect the respondent to remain in Kabul and not drive trucks outside it. It made one assumption – that 26 [2006] 2 AC 426 at 446 [15], 448 [20]. 28 E v Secretary of State for the Home Department [2004] QB 531 at 543 [23]. 29 E v Secretary of State for the Home Department [2004] QB 531 at 543 [24]. Hayne the respondent would be able to work as a jewellery maker in Kabul, as he had formerly done in Jaghori. This assumption does not appear to have been put to the respondent for his comment. The respondent had raised concerns about his ability to earn a living if he were to return to Afghanistan, but the Tribunal did not explore this subject with him. This matter does not fall to be decided on grounds of procedural fairness. Even if the Tribunal's assumption were correct, that assumption could not provide a complete answer to the question the Tribunal should have addressed. Without addressing the question whether it would be reasonable to expect the respondent to remain and work in Kabul, having regard to the circumstances in which that would place him, the Tribunal could not make a final determination as to whether he could be said to have a well-founded fear of persecution. Failure to address this question constituted an error of law. The appeal should be dismissed with costs. GAGELER J. The definition of "refugee" in Art 1A(2) of the Refugees Convention30 contains four cumulative elements: (1) the person concerned must fear "persecution" in the country of his or her nationality; (2) the persecution so feared must be "for reasons of race, religion, nationality, membership of a particular social group or political opinion"; (3) that fear of persecution for one or more of those Convention reasons must be "well-founded"; and (4) the person must be outside the country of his or her nationality "owing to" that well-founded fear. Appellant S395/2002 v Minister for Immigration and Multicultural Affairs31 was concerned with the third element of the definition. The principle for which that case stands is that a fear of persecution for a Convention reason, if it is otherwise well-founded, remains well-founded even if the person concerned would or could be expected to hide his or her race, religion, nationality, membership of a particular social group, or political opinion by reason of that fear and thereby to avoid a real chance of persecution. The rationale for the principle was encapsulated by Dyson JSC as a member of the Supreme Court of the United Kingdom which adopted the principle in HJ (Iran) v Secretary of State for the Home Department32: "If the price that a person must pay in order to avoid persecution is that he must conceal his race, religion, nationality, membership of a social group or political opinion, then he is being required to surrender the very protection that the Convention is intended to secure for him. The Convention would be failing in its purpose if it were to mean that a gay man does not have a well-founded fear of persecution because he would conceal the fact that he is a gay man in order to avoid persecution on return to his home country." (emphasis in original) The S395 principle should not be extended beyond its rationale. The principle directs attention to why the person would or could be expected to hide or change behaviour that is the manifestation of a Convention characteristic33. The principle has no application to a person who would or could be expected to 30 Convention relating to the Status of Refugees (1951) as amended by the Protocol relating to the Status of Refugees (1967). 31 (2003) 216 CLR 473; [2003] HCA 71. 32 [2011] 1 AC 596 at 656 [110]. 33 HJ (Iran) v Secretary of State for the Home Department [2011] 1 AC 596 at 625 hide or change such behaviour in any event for some reason other than a fear of persecution34. The S395 principle similarly has no application to a person who would or could be expected to hide or change behaviour that is not the manifestation of a Convention characteristic. That is so even if the person would or could be expected to change that behaviour in order to avoid a real chance of persecution by reason of the perpetrators of persecution wrongly imputing a Convention characteristic to the person. The price that the person would be paying to avoid persecution in such a case would not be the sacrifice of an attribute of his or her identity that is protected by the Convention. As Downes J succinctly put it in NALZ v Minister for Immigration and Multicultural and Indigenous Affairs35, the principle has no application to a case which "does not contemplate changed behaviour to avoid persecution but to avoid creating a wrongful perception of membership of a protected class". This case, like SZATV v Minister for Immigration and Citizenship36 and SZFDV v Minister for Immigration and Citizenship37, is concerned primarily with the fourth element of the definition. The principle for which those cases stand is that the fourth element will be absent, even though the other three elements are present, if it would be reasonable for the person concerned to return to a region within the country of nationality where, objectively, there is no appreciable risk of the persecution of which the person has the fear that is well-founded. That is the principle on which so-called "relocation" or "internal flight" cases turn, though there is no reason to confine the principle to circumstances which involve a region which is different from the region in which the person last lived before leaving the country of nationality. The principle applies to a person who could safely return to his or her home region but not go to another region in the same way as it applies to a person who could safely return to another region but not go to his or her home region. Underlying the principle is a purposive understanding of the causative connection connoted by the words "owing to" within the context of the Convention. The purposive understanding is that a person is not in need of the protection of the international community, for which the Convention provides, 34 Eg Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 79 ALJR 1142 at 1144 [10]-[11], 1170 [168]; 216 ALR 1 at 4, 40; [2005] HCA 29. 35 (2004) 140 FCR 270 at 283 [57]. 36 (2007) 233 CLR 18; [2007] HCA 40. 37 (2007) 233 CLR 51; [2007] HCA 41. outside the country of his or her nationality if it would be reasonable for the person to return to a region within that country where the person would be safe from persecution. Questions raised by the fourth element of the definition are therefore: whether there is a region within the country of nationality in which there is no appreciable risk of the persecution of which the person has a well-founded fear; and, if so, whether or not it would be reasonable for the person to locate within that region on return to his or her country of nationality. The standard of reasonableness posited by the second of those questions, directed as it is to whether or not a person having a well-founded fear of persecution is to be characterised as being outside the country of nationality "owing to" that well-founded fear within the meaning of Art 1A(2), must itself be informed by the purposes of the Convention. It would not be consistent with the purposes of the Convention for the person to be expected to locate in a region of the country of nationality where he or she would be exposed to a real chance of persecution for one or more Convention reasons even if the person does not currently fear that persecution. Applying the S395 rationale, it would also not be consistent with the purposes of the Convention for the person to be expected to hide or change behaviour that is the manifestation of a Convention characteristic in order to avoid such persecution in that region. That much was explained by Kirby J in SZATV when he said38: "It cannot be a reasonable adjustment, contemplated by [the] Convention, that a person should have to relocate internally by sacrificing one of the fundamental attributes of human existence which the specified grounds in [the Convention] are intended to protect and uphold." The point is illustrated by the outcome in SZATV, which concerned a Ukrainian journalist found to have a well-founded fear of being persecuted by a regional government in Ukraine by reason of the past expression of his political opinions. The Refugee Review Tribunal was held to have erred in law in considering it reasonable for the journalist "to move elsewhere in Ukraine, and live 'discreetly' so as not to attract the adverse interest of the authorities in his new location, lest he be further persecuted by reason of his political opinions"39. The Convention being expressed in its preamble to be founded on the "principle that human beings shall enjoy fundamental rights and freedoms without discrimination", it can also be accepted that it would not be consistent with the purposes of the Convention for the person to be expected to locate in a 38 (2007) 233 CLR 18 at 48-49 [102]. 39 (2007) 233 CLR 18 at 29 [32]. region of his or her country of nationality at the cost of sacrificing his or her dignity or depriving him or her of the enjoyment of fundamental rights or freedoms. There is, however, a real difference between the enjoyment of fundamental rights and freedoms and the level of enjoyment of fundamental rights and freedoms. The reasoning of the plurality in SZATV40 adopted and applied the reasoning of the House of Lords in Januzi v Secretary of State for the Home Department41 in emphasising that the Convention is not directed (apart from persecution) to the level of civil, political, social or economic rights prevailing in the country of nationality. The actual holding in Januzi was that the standard of reasonableness is not concerned with assessing the quality of life which the person might be expected to have within the safe region of the country of nationality against basic norms of civil, political and socio-economic rights42. Nor is the test of reasonableness concerned with assessing the quality of life which the person concerned might be expected to have within the safe region of the country of nationality against the quality of life which the person could expect to have if the person were able to move freely about the country of nationality without fear of persecution. The content of the standard of reasonableness, as applied to a consideration of a person's economic circumstances within the safe region of the country of nationality, is, rather, that encapsulated in the passages from the UNHCR Guidelines on International Protection quoted with approval in Januzi. The most pertinent of those passages for present purposes is the following43: "It would be unreasonable, including from a human rights perspective, to expect a person to relocate to face economic destitution or existence below at least an adequate level of subsistence. At the other end of the spectrum, a simple lowering of living standards or worsening of economic status may not be sufficient to reject a proposed area as unreasonable. Conditions in the area must be such that a relatively normal life can be led in the context of the country concerned." The Tribunal here found: that the first respondent ("the respondent") had a fear of persecution by the Taliban in Afghanistan; that the feared persecution was by reason of political opinion imputed to him by the Taliban; and that the fear of that persecution was well-founded. The Tribunal also found that there 40 (2007) 233 CLR 18 at 27 [25]. 42 [2006] 2 AC 426 at 446-448 [15]-[19], 457 [45]-[46], 459 [54]. 43 [2006] 2 AC 426 at 448-449 [20]. was no appreciable risk of the occurrence of that persecution if the respondent returned to, and remained in, Kabul. The Tribunal was correct to recognise that, on those findings, "the issue of relocation does not arise as such" given that the respondent had established his home in Kabul before he left Afghanistan. Yet the Tribunal was also correct to recognise that those findings did give rise to an issue about the application to the respondent of the same principle as that which underlies an issue of relocation: whether the respondent was outside Afghanistan "owing to" that well-founded fear of persecution by the Taliban in Afghanistan. The question which the Tribunal needed to address was whether it would be reasonable for the respondent, on return to Afghanistan, to live and work in Kabul. I cannot see that the Tribunal failed to address and to answer that question. The respondent was represented before the Tribunal by a migration agent. The migration agent had noted in a pre-hearing submission to the Tribunal that the delegate had appeared to assume that, on return to Afghanistan, the respondent would not resume work as a truck driver. The migration agent had acknowledged that the respondent had previously been employed as a silver jeweller but had submitted that "due to a drop in demand, the income he received from such employment became insubstantial to raise his family". The migration agent had gone on to quote statistics from a recent report of the Danish Immigration Service to the effect that 36% of the work force was unemployed in Afghanistan and that another 36% was earning less than $1 a day. The migration agent had continued: "Further, the [respondent] has no education and is a 48 year old man who will be unable to be employed in labour intensive positions, whilst he is only skilled in silver making, which he found was an insufficient profession in order to support his family. If returned to Afghanistan, in order to provide for his family the [respondent] would be required to resume his employment as a truck driver and would risk detection and/or identification at Taliban checkpoints." The Tribunal specifically recorded in its reasons for decision that, during the hearing, it discussed with the respondent material relating both to security in Kabul and to the "practical issues" associated with living in Kabul, which the Tribunal referred to later in its reasons under the heading "Kabul". The Tribunal also recorded that, at the Tribunal's invitation, the respondent's migration agent provided a post-hearing submission which was to the effect that the respondent would be unable to return to the jewellery business in Kabul and would in consequence be forced again to take up employment as a truck driver, thereby taking him out of Kabul. The inability of the respondent to return to the jewellery business in Kabul was said in the post-hearing submission to be not only because the respondent was an uneducated person who was then 48 years old but also because he would be "unable to provide the capital or physically partake in the labour necessary to return to the business". Under the heading "Kabul", the Tribunal went on in its reasons for decision to record findings which included that the respondent and his family had since 2007 established their home in a solidly Hazara area of Kabul, where his wife and children remained, and that the respondent would not face a real chance of persecution by the Taliban were he to return to and remain in Kabul. As to the practical issues associated with the respondent being able to work in Kabul, the Tribunal said this: "The Tribunal does not accept that the [respondent] would be constrained to continue working as a truck driver on the roads between Ghazni and Jaghori, which is where he faces a real chance of persecution rather than in his home region of Kabul. The Tribunal is satisfied that the [respondent] could reasonably obtain relevant employment in Kabul so that he would not be obliged to travel between Kabul and Jaghori to make a living. The [respondent] has long-established skills making jewellery – a trade at which he worked from 1977 to 2001 – giving him real options in a very big city, either with his own business or as an employee. The Tribunal does not accept that the [respondent] would be prevented from doing so by reason of lack of capital or a claimed – but unelaborated – inability to 'physically partake in the labour necessary to return to the business'." The Tribunal's reasons for decision, of course, "are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed"44. But even without resort to that well-worn principle, I cannot read the passage quoted from those reasons as doing other than confronting and answering the correct question of whether it would be reasonable for the respondent, on return to Afghanistan, to live and work in Kabul. That view of what the Tribunal did makes it necessary for me to address a specific criticism of the Tribunal's reasoning advanced on the respondent's behalf in the appeal to this Court. The criticism is that the Tribunal failed to address a specific claim of the respondent that he feared persecution by the Taliban on the basis of being a member of a particular social group comprising truck drivers who transport goods for the Afghan government or for foreign agencies. Had the Tribunal addressed and accepted that claim, it is argued, the Tribunal could not have gone on to find that it was reasonable for the respondent to avoid 44 Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 272; [1996] HCA 6. persecution by remaining in Kabul. That was because, to remain in Kabul, the respondent would need to give up work as a truck driver, and giving up work as a truck driver would involve changing the very behaviour which was a characteristic of the particular social group of which the respondent was a member. The difficulty for the respondent in so criticising the reasoning of the Tribunal lies in needing to characterise truck drivers who transport goods for the Afghan government or for foreign agencies as a particular social group for the purposes of the Convention. There appears to have been no basis in the material before the Tribunal for considering that a group so defined had anything in common, save for a fear of persecution by reason of their imputed political opinion. That deficiency is fatal to the respondent's argument45. Had the material disclosed some other common characteristic, a further question as to whether those common characteristics were sufficient to constitute a particular social group would have arisen46. In particular, it would be necessary to consider the impact of the Tribunal finding that it did not accept "that working as a truck driver is a core aspect of the [respondent's] identity or beliefs or lifestyle which he should not be expected to modify or forego". Now is not the time to explore that question. I would allow the appeal. 45 Minister for Immigration and Ethnic Affairs v Guo (1997) 191 CLR 559 at 571; [1997] HCA 22 applying Applicant A v Minister for Immigration and Ethnic Affairs (1997) 190 CLR 225; [1997] HCA 4; Applicant S v Minister for Immigration and Multicultural Affairs (2004) 217 CLR 387 at 400 [36]; [2004] HCA 25. 46 Cf Ouanes v Secretary of State for the Home Department [1998] 1 WLR 218.
HIGH COURT OF AUSTRALIA Matter No S232/2004 AND APPELLANT CGU INSURANCE LIMITED RESPONDENT Matter No S233/2004 APPELLANT AND CGU INSURANCE LIMITED RESPONDENT Rich v CGU Insurance Limited Silbermann v CGU Insurance Limited [2005] HCA 16 7 April 2005 S232/2004 and S233/2004 ORDER In each matter: Special leave rescinded. Appellant to pay the respondent's costs of the proceedings in this Court. On appeal from the Supreme Court of New South Wales Representation: D L Williams SC with M A Jones for the appellants (instructed by Joanne Kelly) D F Jackson QC with A W Street SC and E G Romaniuk for the respondent (instructed by Colin Biggers & Paisley) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Rich v CGU Insurance Limited Silbermann v CGU Insurance Limited Insurance – Professional indemnity insurance – Directors and officers liability insurance policy – Exclusion for losses arising from dishonest, fraudulent or malicious conduct – Exclusion engaged only where conduct established to have occurred following final adjudication adverse to the insured – Proceedings instituted against appellants involving questions of breach of duty as company directors – Appellants claimed for advance payment of defence costs under policy – Respondent insurer purported to deny liability relying on exclusion under the policy – Respondent also argued that it had avoided the policy under the Insurance Contracts Act 1984 (Cth), s 28 – Whether respondent can rely on exclusion absent an existing judgment or other final adjudication adverse to appellants. Practice and procedure – Appeal – Separated questions for determination – Appeal in respect only of one answered question and not in respect of other two – Whether any utility in considering the correctness of the answer appealed from in light of other two undisturbed answers – Avoidance of circuity of action. High Court – Special leave to appeal – Special leave granted – Whether special leave to appeal should be revoked. the separate determination of GLEESON CJ, McHUGH AND GUMMOW JJ. In suits in the Equity Division (Commercial List) of the Supreme Court of New South Wales, McClellan J ordered Mr Rich and Mr Silbermann were two of three plaintiffs and each had been a director of One.Tel Ltd which is in liquidation. The plaintiffs sought to establish that the defendant ("CGU") was obliged to provide indemnity for, and advance, defence costs of an investigation by the Australian Securities and Investments Commission ("ASIC"), of two proceedings instituted by ASIC in the Supreme Court and of other proceedings, all involving questions of possible serious breaches of duty by the plaintiffs. three questions. The liability of CGU was said to arise under a "Directors & Officers Liability Insurance Policy" issued on 2 August 2000 by CGU ("the Policy"). The Policy is in a form resembling, in some respects, that of the policy which falls for consideration by this Court in Wilkie v Gordian Runoff Ltd1 but differing in other respects. It is not to be assumed that the construction given to the policy in Wilkie would control the present case. The plaintiffs had commenced by summonses, to each of which there was appended a detailed summary of contentions resembling a pleading by statement of claim. By CGU's amended points of defence, it advanced contentions summarised therein as follows: "[C]ertain of the claimed Defence Costs do not come within the terms of the Policy, that Exclusion Clause 3.1 applies in relation to the alleged wrongful acts, and that the contract has been validly avoided by reason of both fraudulent non-disclosure and fraudulent misrepresentation." The reference above to avoidance by CGU of the contract of insurance is to the step open to an insurer under s 28(2) of the Insurance Contracts Act 1984 (Cth) ("the Insurance Contracts Act")2. The relief sought by the plaintiffs included an order that CGU advance the defence costs described above, incurred and to be incurred by them. It will be apparent that if at the trial CGU made good its case of avoidance that would bring down the Policy, including the provision on which the plaintiffs rely to found the order for provision of their defence costs. [2005] HCA 17. 2 By contrast, the insurer in Wilkie did not avoid the policy and did not rely upon s 28(2) of the Insurance Contracts Act. McHugh One feature of the plaintiffs' forensic strategy which has led to the dispute before this Court has been to establish a means whereby the entitlement to advancement of defence costs is established by judicial decision in advance of adjudication of the avoidance issue. It then would be for CGU, if successful on that issue, to recover the sums already advanced and for CGU to bear the risk of lack of success in pursuing recovery. To that end, the procedure for separate determination of questions before trial was, over the opposition of CGU, invoked on the application of the plaintiffs. McClellan J gave to each of the three questions an affirmative answer which thus was adverse to the interests of the plaintiffs. The Court of Appeal (Beazley, Hodgson and Tobias JJA)3 granted leave to appeal but dismissed the appeals. The Court of Appeal affirmed the answers given to the three questions, although Hodgson JA considered the affirmative answer to question 1 should be understood in a qualified sense to which he had adverted in his reasons4. Mr Rich and Mr Silbermann5 then sought special leave from this Court on the ground that the Court of Appeal had erred in upholding the affirmative answer to question 1. They sought an order that question 1 be answered "no". No error was asserted respecting the answer to the other two questions and no order sought from this Court respecting them. CGU resisted any grant of special leave on various grounds. One was that, even if the plaintiffs obtained the relief they sought in this Court, this would not necessarily have any decisive effect upon the principal litigation awaiting trial6. In particular, if CGU made good its reliance upon s 28(2) of the Insurance Contracts Act, questions of construction would be directed to an instrument of no legal effect. Special leave was granted and the appeals by Mr Rich and Mr Silbermann were set down for hearing together. As argument was developed on the hearing of the appeals, close attention was given to the interrelation between question 1 and the other two questions, and to the necessary effect for consideration of 3 Silbermann v CGU Insurance Ltd (2003) 57 NSWLR 469. (2003) 57 NSWLR 469 at 484. 5 A third plaintiff, Mr Greaves, did not seek special leave and has played no part in proceedings in this Court. When used in relation to the proceedings in this Court, "plaintiffs" identifies Mr Rich and Mr Silbermann. cf Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 355-360 [45]-[59]. McHugh question 1 of the answers given by McClellan J and the Court of Appeal to the other two questions. It became apparent that the appropriate course is for this Court to revoke special leave. For an appreciation of why the Court should take this course, it is convenient first to refer to several provisions of the Policy. Section 1 is headed "Operative Clause" and includes "Directors and Officers Liability Insuring Agreement A" and "Corporate Reimbursement Insuring Agreement B". It is cll 2.1 and 2.6, two of the "Automatic Extensions" listed in "Section 2", which are of principal importance for the defence costs which the plaintiffs would have CGU meet. Clause 2.1 states: "Advancement of Defence Costs Where the Insurer elects not to take over and conduct the defence or settlement of any Claim in the name of any Director or Officer, the Insurer shall meet the Defence Costs of any Director or Officer in defending or settling any Claim made against them as they are incurred and prior to the finalisation of the Claim provided always that indemnity in respect of such Claim has been confirmed in writing by the Insurer. Where the Insurer has not confirmed indemnity and it elects not to take over and conduct the defence or settlement of any Claim, it may, in its discretion, pay Defence Costs as they are incurred and prior to the finalisation of the Claim, provided that it has consented in writing to such Defence Costs prior to their being incurred, such consent not to be unreasonably withheld. The Insurer reserves the right to recover any Defence Costs from the Directors or Officers and/or the Corporation severally according to their respective interests in the event and to the extent that it is subsequently established by judgement or other final adjudication that the Directors and Officers and/or the Corporation were not entitled to the Defence Costs so advanced." (emphasis added) It is the middle paragraph which is of particular importance. This is because CGU has not confirmed indemnity and has not taken over the conduct of any defence. CGU may then, in its discretion, pay Defence Costs "as they are incurred". Clause 2.6 is headed "Attendance at Official Investigations or Inquiries". It provides that CGU will pay Defence Costs incurred with its prior written consent in attending certain official investigations and inquiries which involve an McHugh allegation against a Director or Officer "which is the subject of indemnity under this Policy". Section 3 is headed "Exclusions" and introduces what follows with the general statement: "This Policy does not provide an indemnity against any Claim made against any Director or Officer". There follows: "3.1 Dishonesty & Fraud brought about by, contributed to by or which involves: the dishonest, fraudulent or malicious act or omission or other act or omission committed with criminal intent of such Director or Officer; such Director or Officer having improperly benefited in fact from securities transactions as a result of information that was not available to other sellers and/or purchasers of such securities; or such Director or Officer having gained in fact any personal advantage to which he/she was not legally entitled. However, this exclusion shall only apply to the extent that the subject conduct has been established by a judgement or other final adjudication adverse to the Director or Officer." (emphasis added) It is with these provisions in mind that the three questions for separate determination are to be read. They state: "1. Whether, on a true construction of Directors & Officers Liability Insurance Policy No 01 DO 0298798 ('the Policy'), issued by the Defendant absent an existing judgment, order or other final adjudication adverse to the Plaintiff, the Defendant can rely on Exclusion Clause 3.1 in answer to the Plaintiff's claim for indemnity under the Policy; 2. Whether, on the true construction of the Policy issued by the Defendant the Defendant itself is entitled to seek a judgment, order or other final adjudication adverse to the Plaintiff and, thereby, exclude liability for a claim under clause 3.1 of the Policy in the same proceedings in which the Plaintiff makes a claim for indemnity against the Defendant. McHugh 3. Whether, on the true construction of the Policy issued by the Defendant, Exclusion Clause 3.1 of the Policy operates to exclude liability on the part of the defendant to pay claims by the Plaintiff for indemnity for Defence Costs under; clause 2.1 of the Policy; clause 2.6 of the Policy; (iii) Insuring Agreement A of the Policy; and Insuring Agreement B of the Policy." Something first should be said respecting the significance of the unchallenged affirmative answer to question 2. In the principal proceedings in the Commercial List in which the plaintiffs seek indemnity, CGU may seek judgment in its favour and thereby exclude liability under Exclusion Clause 3.1. However, the plaintiffs submit that there still remains scope for question 1. The answer to question 1 which they now seek is not limited to a simple "no" but, as formulated in the course of argument in this Court, is intended to accommodate the affirmative answer to question 2 and includes as an alternative: "[CGU] cannot plead Exclusion Clause 3.1 by way of defence to the Plaintiff's claim for the Defence Costs which have been incurred by the Plaintiff unless and until there has been a judgment, order or other final adjudication adverse to the Plaintiff establishing the subject conduct identified in cl 3.1." It appears that the "final adjudication" spoken of in this proposed answer is designed to identify judgment on a cross-claim by CGU against the plaintiffs. In further explanation, counsel for the plaintiffs envisaged a successful summary judgment application by the plaintiffs in their actions against CGU and an order that the Defence Costs be advanced. In that summary judgment proceeding, assuming the above answer to question 1, questions of dishonesty and fraud raised by CGU's reliance upon Exclusion Clause 3.1 would be postponed to the final adjudication of a cross-claim by CGU. In the meantime, the plaintiffs would have their money and CGU would bear any risk associated with its recoupment if the trial of the cross-claim by CGU went in its favour. McHugh However, the general principle is that issues raised in proceedings are to be determined in a summary way only in the clearest of cases. In Agar v Hyde, Gaudron, McHugh, Gummow and Hayne JJ said7: "Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways8, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way." Given these principles and the affirmative answer to question 2, how could the summary judgment procedure envisaged by the plaintiffs successfully be used to shut out consideration at that stage of Exclusion Clause 3.1 and attendant issues of dishonesty and fraud? Further, and in any event, if the suits by the plaintiffs and the putative cross-claim by CGU were pursued to judgment, the submissions for the plaintiffs wrongly assumed that an order for payment to the plaintiffs by CGU necessarily would be entered independently of any order on the cross-claim vindicating the denial of indemnity by CGU. The principles respecting the avoidance of circuity of action indicate that the litigation would not be resolved by orders obliging CGU to make payments it was not and never had been required by contract to make9. What the plaintiffs would have this Court embark upon is consideration of an hypothesis, which is essential for the plaintiffs' appeals, but inapt to produce that result (advancement of funds in advance of determination of defences raised by CGU) which the determination of separate questions in advance of trial was designed by the plaintiffs to secure. (2000) 201 CLR 552 at 575-576 [57]. 8 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 91 per Dixon J; General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 130 per Barwick CJ. 9 See as to the avoidance of circuity of action McDermott v Black (1940) 63 CLR 161 at 186-187; Qantas Airways Ltd v Aravco Ltd (1996) 185 CLR 43 at 49-50; Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 609. McHugh Special leave should be rescinded. The costs of CGU of the proceedings in this Court should be borne by Mr Rich and Mr Silbermann. Kirby KIRBY J. The facts, the course of these proceedings and the decisions below are set out in other reasons. So are the separated questions, question 1 of which was reframed in this Court. Upon the construction of the "Directors & Officers Liability Insurance Policy" ("the Policy") issued on 2 August 2000 by the respondent insurer, I am in general agreement with the reasons of Callinan J. I do not take quite the same approach to the contra proferentem10 rule of construction as his Honour does. For me, this is an interpretive tool of last resort, where analysis of a contested text does not otherwise yield a satisfying conclusion11. Moreover, the contra proferentem rule obviously has less application in cases where, as here, both parties are corporations experienced in, and familiar with, insurance policies of the kind the subject of these appeals, and where both parties have enjoyed legal advice and are of roughly equal bargaining power12. In the present matter, I do not regard this difference over the rule as significant. Considerations such as the commercial object of the instrument13, the consequent operation of the document read as a whole14 and the purposive approach now adopted in the ascertainment of the meaning of contested language15 usually lead to the same result as the contra proferentem rule in the construction of disputed insurance policies. The points made by Callinan J concerning the commercial purpose of the Policy; its utility in the fairly typical situation that arose involving the appellants; 10 A Latin maxim: "the words of an instrument should be taken most strongly against the party proffering it". 11 Johnson v American Home Assurance Co (1998) 192 CLR 266 at 272-276 [19]; McCann v Switzerland Insurance Australia Ltd (2000) 203 CLR 579 at 600-603 [74]; cf at 589 [22]; Andar Transport Pty Ltd v Brambles Ltd (2004) 78 ALJR 907 at 922-923 [68]; cf at 911 [17], 930-931 [122]-[124]; 206 ALR 387 at 408-409; cf at 392-393, 419-420. See also Macey v Qazi [1987] CLY 425; Pitcher v Principal Mutual Life Insurance Co 870 F Supp 903 (SD Ind 1994). 12 See Wilkie v Gordian Runoff Ltd [2005] HCA 17 at [17]. 13 Lake v Simmons [1927] AC 487 at 509; McCann v Switzerland Insurance Australia Ltd (2000) 203 CLR 579 at 589 [22], 601 [74]. 14 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 15 Kirby, "Towards a Grand Theory of Interpretation: The Case of Statutes and Contracts", (2003) 24 Statute Law Review 95 at 96. Kirby and the express language of the Policy (particularly the explicit condition for the engagement of the exemption in cl 3.1) appear to me to be compelling. This conclusion requires me to attempt to reconcile the answer which the appellants seek to question 1, as reformulated, with the answers that they have accepted to questions 2 and 3. They accepted those answers by not appealing against them. Callinan J has explained the incompatibility between, in particular, the answer to question 2 (accepted by the appellants) and the answer they have sought to question 1. Notwithstanding that I prefer the approach to the construction of the Policy stated by Callinan J, I come ultimately to the same conclusion as the other members of this Court. These were well advised and expertly represented appellants. They were not inexperienced in litigation, including in this Court. I am unconvinced that I should struggle to attempt to rescue them from the outcome inherent in the course that they have chosen. For these reasons, I agree in the orders proposed by Gleeson CJ, McHugh Callinan CALLINAN J. These appeals raise questions as to the proper construction of the respondent's policy of insurance indemnifying the appellants as directors and officers of a corporation, in particular a clause of it excluding liability to provide indemnity if a judgment or other final adjudication has established dishonest conduct by the appellants. The indemnity presently sought from the respondent is the amount of legal costs incurred by the appellants in defending proceedings commenced against them by the corporate regulator, the Australian Securities and Investments Commission ("ASIC"). The appellants contend that the respondent is not entitled to decline to provide funds pursuant to the policy because there has been neither a judgment nor any other final adjudication establishing dishonest conduct by them. The respondent asserts that it is entitled to refuse to provide indemnity whilst it pursues its own proceedings against the appellants to obtain a judgment establishing dishonest conduct by them. Each party advances a construction in support of his and its stance. In my view, the appellants' construction is to be preferred. But, as will appear, that does not mean that the appellants' appeals must succeed. Facts The appellants are former directors of One.Tel Limited (In Liquidation) ("One.Tel"). On 29 May 2001, the directors of One.Tel appointed administrators of the company under s 436A of the Corporations Law as it then was. Soon afterwards, on or about 31 May 2001, ASIC started to investigate the failure of One.Tel, as well as possible contraventions of the Corporations Law by its directors. During the investigation, ASIC sought an injunction against the appellants prohibiting them from transferring or otherwise disposing of their assets, and requiring them to attend an examination under s 596A of the Corporations Law to be conducted by it. On 12 December 2001, ASIC filed originating proceedings in the Supreme Court of New South Wales seeking, among other things, declarations that the appellants contravened s 180(1) of the Corporations Law16, orders 16 That section, which has been retained in the Corporations Act 2001 (Cth), required directors to exercise reasonable care and diligence in the discharge of their duties. It provided: "180(1) Care and Diligence – directors and other officers A director or other officer of a corporation must exercise their powers and discharge their duties with the degree of care and diligence that a reasonable person would exercise if they: (Footnote continues on next page) Callinan prohibiting them from managing a corporation, and orders requiring them to pay compensation to One.Tel. The appellants have already apparently incurred substantial legal costs and charges in monitoring and attending the examination, and in defending the proceedings, including costs and expenses incurred by them in attending public examinations conducted by the liquidators of One.Tel in 2002 and in defending a claim by American Express International Inc in relation to the use of credit cards. At all material times, the appellants were insured under a Directors and Officers Liability Insurance Policy ("the policy") issued by the respondent. Under the policy, the material terms of which I will set out later, the respondent agreed to indemnify the appellants against "Loss" arising out of any "Claim" for any "Wrongful Act" committed by them in their capacity as directors of One.Tel. "Loss" is defined to include "Defence Costs". It is not disputed that although the appellants may have a right of indemnity against One.Tel in respect of their legal costs and expenses, One.Tel would be unable to provide it because of its insolvency. The respondent has not confirmed that it will provide indemnity under the policy, has not elected to take over the defence of the ASIC proceedings, and has refused to pay the appellants' legal costs and expenses. It also claims that it has, in any event, avoided the policy. The proceedings between the parties On 3 September and 30 September 2002, the appellants filed summonses in the Supreme Court of New South Wales claiming an indemnity for their costs in defending the proceedings brought by ASIC and related costs. The respondent filed defences claiming that on the true construction of the policy, it was not obliged to provide indemnity to the appellants, and that it was entitled to avoid the policy under s 28(2) of the Insurance Contracts Act 1984 (Cth)17 by reason of (a) were a director or officer of a corporation in the corporation's circumstances; and occupied the office held by, and had the same responsibilities within the corporation as, the director or officer." 17 Section 28 provides: "28 General Insurance (1) This section applies where the person who became the insured under a contract of general insurance upon the contract being entered into: (a) failed to comply with the duty of disclosure; or (Footnote continues on next page) Callinan fraudulent non-disclosures and misrepresentations by the appellants. The respondent also claimed that it was entitled to rely upon exclusion cl 3.1 of the policy to refuse to indemnify the appellants because of their dishonest or fraudulent conduct. Detailed particulars of the alleged dishonest conduct were pleaded and are relevantly as follows: ... in terms of cl 3.1 of the policy, the 'Claim' was brought about by, contributed to or involved dishonest or fraudulent acts or omissions of each appellant; ... that it was entitled to, and has, avoided the policy by reason of fraudulent non-disclosure and fraudulent misrepresentation." The appellants brought an application for the separate determination of three questions arising out of the pleadings. The respondent contended that the Court ought not to entertain the application. On 19 November 2002, McClellan J allowed it to proceed on the basis that the questions be determined upon the assumption that the allegations of dishonest conduct pleaded by the respondent were true. His Honour was of the view that the determination of the three questions in advance of trial might avoid the necessity of an expensive and lengthy hearing to determine the factual issues raised by the pleadings. In their final form, the questions put to the Supreme Court were: "1. Whether, on the true construction of Directors & Officers Liability Insurance Policy No 01 DO 0298798 ('the Policy'), issued by the Defendant absent an existing judgment, order or other final adjudication adverse to the Plaintiff, the Defendant can rely on Exclusion Clause 3.1 in answer to the Plaintiff's claim for indemnity under the Policy; (b) made a misrepresentation to the insurer before the contract was entered into; but does not apply where the insurer would have entered into the contract, for the same premium and on the same terms and conditions, even if the insured had not failed to comply with the duty of disclosure or had not made the misrepresentation before the contract was entered into. (2) If the failure was fraudulent or the misrepresentation was made fraudulently, the insurer may avoid the contract. Callinan 2. Whether, on the true construction of the Policy issued by the Defendant the Defendant itself is entitled to seek a judgment, order or other final adjudication adverse to the Plaintiff and, thereby, exclude liability for a claim under clause 3.1 of the Policy in the same proceedings in which the Plaintiff makes a claim for indemnity against the Defendant; 3. Whether, on the true construction of the Policy issued by the Defendant, exclusion clause 3.1 of the Policy operates to exclude liability on the part of the Defendant to pay claims by the Plaintiff for indemnity for Defence Costs under: clause 2.1 of the Policy; clause 2.6 of the Policy; (iii) Insuring Agreement A of the Policy; and Insuring Agreement B of the Policy." The decision of the primary judge McClellan J delivered his reasons for judgment on 18 December 2002, answering all three questions in the affirmative18. In relation to Questions 1 and 2, his Honour was of the view that the final paragraph of cl 3.1 did not operate to prevent the respondent from relying upon the exclusion clause to deny indemnity in circumstances in which there has been no relevant finding of dishonesty in other proceedings. His Honour observed that there is a variety of circumstances in which adverse findings may be made in relation to the conduct of a director or officer, including in a Royal Commission or official investigation, or other similar proceedings. Findings in any of those would not however justify a denial of indemnity. His Honour concluded that a denial of indemnity could be established by an insurer, virtually in any proceedings, whether the insurer was or was not a party to them, and, if it was, that it could, in such proceedings, in good faith, maintain its stance that its insureds acted dishonestly19: "However, there is nothing in the clause to suggest that the exclusion should be confined to a finding in proceedings other than the indemnity proceedings. The rights of the parties to a policy of insurance often have to be determined by a court. In such proceedings, either party is able to advance its position and assert that the objective facts entitle the insured to 18 Silbermann, Greaves and Rich v CGU Insurance Ltd [2002] NSWSC 1195. 19 [2002] NSWSC 1195 at [46]. Callinan indemnity or otherwise. This does not involve any lack of 'good faith' by either party. The court will determine the parties' rights having regard to the evidence which the parties tender at the trial and the findings which it makes." With respect to Question 3, McClellan J held that absent exclusion cl 3.1, the respondent would be obliged to indemnify a director or officer with respect to any "Loss", this being defined to include "Defence Costs", which in turn is one of the amounts payable "in respect of a Claim". Accordingly, to the extent that cl 3.1 excludes "indemnity against any Claim", it excludes indemnity in relation to "Defence Costs" associated with that "Claim". The appellants sought to appeal to the Court of Appeal of New South Wales. The decision of the Court of Appeal On 25 July 2003, the Court of Appeal (Beazley, Hodgson and Tobias JJA) granted the appellants leave to appeal but dismissed the appeal with costs20. While the Court of Appeal unanimously held that Questions 2 and 3 had been answered correctly by McClellan J, Hodgson JA expressed some reservations about the answer given by the primary judge to Question 1. Tobias JA, with whom Beazley JA agreed, was of the view that cl 3.1 could be relied upon by the respondent to deny indemnity with respect to defence costs in the absence of and before a judgment or other final adjudication adverse to the appellants is obtained. His Honour said21: "In my opinion, the Policy was not intended to provide a form of 'up front' indemnity for the Defence Costs to the insured in the circumstances postulated. The clear structure of the Policy entitles the insurer to refuse indemnity in respect of any part of any Loss including Defence Costs where it asserts dishonest conduct within the meaning of cl 3.1 provided only that it will be ultimately required to indemnify the insured against that Loss unless it establishes by a judgment or other final adjudication that the relevant conduct was dishonest. In my opinion, neither the Policy nor its commercial purpose requires the insurer to advance to the insured either Defence Costs or any other amount payable in respect of a Claim where it has denied indemnity upon any proper ground including that provided by cl 3.1." 20 Silbermann v CGU Insurance Ltd (2003) 57 NSWLR 469. 21 (2003) 57 NSWLR 469 at 487 [77]. Callinan Tobias JA was of the view that if the respondent were obliged to indemnify the appellants in their defence of a claim, then it would also be obliged to pay any amount determined to be payable in respect of that claim. His Honour considered that such a result was problematic in circumstances in which the respondent subsequently obtains judgment against the appellants within the meaning of cl 3.1, because it might then be too late for the respondent to recover the amount payable in respect of the claim for which it has already provided indemnity22. Tobias JA was also of the view that for the respondent to comply with its obligation of good faith, any defence raised by it invoking cl 3.1 must be based on reasonable grounds. That is, the respondent could not raise a defence based on cl 3.1 for the purpose of frustrating or delaying the appellants' defence of a claim brought by a third party23. Hodgson JA was of the view that the commercial purpose of the policy was to provide the appellants with costs to enable them to defend claims notwithstanding the fact that they might include allegations of dishonesty. If dishonesty were established by a judgment and costs had been advanced, then the appellants would be liable to refund those costs in accordance with cl 2.1 of the "In my opinion, if the [respondent] were wholly correct about the final paragraph of cl 3.1, it would either be entirely otiose or else operate solely to the benefit of the insurer. To have the benefit of the exclusion provided by cl 3.1, the insurer has to prove that it applies; and if the final paragraph were not there, the insurer would have to obtain a final adjudication to that effect in the insurance proceedings themselves. Plainly, it would not be sufficient merely to point to allegations, or to a finding of another tribunal not amounting to a judgment or final adjudication. The only thing additional that the paragraph could do, on the construction suggested by the [respondent], would be to provide, in the insurer's favour, that it could rely on a judgment or final adjudication in other proceedings, and then not otherwise itself have to prove the application of cl 3.1 in the insurance proceedings themselves. In my opinion, the final paragraph of cl 3.1 was intended to confer a benefit on the insured, a benefit consistent with the general purpose of the Policy to assist in defence against allegations, at least until such time 22 (2003) 57 NSWLR 469 at 487 [76]. 23 (2003) 57 NSWLR 469 at 487-488 [78]. 24 (2003) 57 NSWLR 469 at 481 [46]-[47]. Callinan as allegations involving dishonesty and the like were proved. In my opinion, this is confirmed by cll 4.4, 4.5, 4.15 and 4.16. I think effect should be given to the words 'has been established', so that cl 3.1 cannot prevent the contract requiring the insurer to provide indemnity, unless and until the requisite judgment or adjudication has been obtained." The appeal to this Court The appellants' submissions Only Question 1 was presented as an issue in this Court. The appellants submit that the Court of Appeal erred by preferring a construction that enabled the respondent to rely upon the exclusion clause in circumstances in which no subsisting judgment or final adjudication exists, and there is a possibility only that such a judgment or adjudication will come into existence in the future. The appellants contend that such a construction is incompatible with its plain meaning and seeks to read words into the exclusion clause that are not there. They submit that the use of the past tense in cl 3.1 is determinative: that it applies only to the extent that the conduct in question has been established, and that therefore the clause cannot apply until it has been proved. In the alternative, the appellants submit that if the exclusion clause is ambiguous, then it should be construed strictly against the respondent so that the respondent suffers the consequences of the ambiguity, rather than the appellants. The respondent's submissions The respondent submits that it has a discretion under cl 2.1 of the policy whether to advance defence costs to the appellants, and that it is not unreasonable for it to withhold consent to payment in circumstances in which there is a bona fide contention of dishonest conduct by the appellants within the meaning of cl 3.1. The respondent also submits that the nature of the limitation imposed by cl 3.1 is not temporal but is concerned with a particular type of conduct. Accordingly, the respondent is entitled to rely on cl 3.1 if it honestly asserts that the appellants have engaged in such conduct, irrespective of whether the conduct has been established by a relevant judgment or other final adjudication. In order to construe cl 3.1 it is necessary to have regard to the material terms of the policy as a whole. Section 1 of it is as follows: "Section 1 Operative Clause Directors and Officers Liability Insuring Agreement A The Insurer will pay on behalf of the Directors and Officers any Loss for which the Directors and Officers may not be legally indemnified by the Corporation arising out of any Claim, by reason of any Wrongful Act Callinan committed by them in their capacity as a Director or Officer, first made against them jointly or severally during the Period of Insurance and notified to the Insurer during the Indemnity Period. Corporate Reimbursement Insuring Agreement B The Insurer will pay on behalf of the Corporation any loss payment which it is legally permitted to make arising out of any Claim, by reason of any Wrongful Act, committed by any Director or Officer in their capacity as a Director or Officer, first made against the Director or Officer during the Period of Insurance and notified to the Insurer during the Indemnity Period. The total amount payable in respect of all Claims under Insuring Agreement A and/or Insuring Agreement B of this Policy shall not in the aggregate exceed the limit of aggregate liability as stated in Item 5 of the schedule." Section 2 is relevantly in this form: "Section 2 Extensions Unless specified otherwise to the contrary the cover granted by these extensions is subject to all the terms and conditions of this Policy. Automatic Extensions 2.1 Advancement of Defence Costs Where the Insurer elects not to take over and conduct the defence or settlement of any Claim in the name of any Director or Officer, the Insurer shall meet the Defence Costs of any Director or Officer in defending or settling any Claim made against them as they are incurred and prior to the finalisation of the Claim provided always that indemnity in respect of such Claim has been confirmed in writing by the Insurer. Where the Insurer has not confirmed indemnity and it elects not to take over and conduct the defence or settlement of any Claim, it may, in its discretion, pay Defence Costs as they are incurred and prior to the finalisation of the Claim, provided that it has consented in writing to such Defence Costs prior to their being incurred, such consent not to be unreasonably withheld. The Insurer reserves the right to recover any Defence Costs from the Directors or Officers and/or the Corporation severally according to their respective interests in the event and to the extent Callinan that it is subsequently established by judgment or other final adjudication that the Directors and Officers and/or the Corporation were not entitled to the Defence Costs so advanced. 2.6 Attendance at Official Investigations or Inquiries The Insurer will pay Defence Costs incurred with its prior written consent by or on behalf of a Director or Officer in attending any official investigation, examination, inquiry or other proceedings ordered or commissioned by any official body or institution, where a Director or Officer is legally compelled by such body or institution to attend such investigation, examination, inquiry or proceeding and which involves an allegation of a Wrongful Act against a Director or Officer which is the subject of indemnity under this Policy. 2.11 Preservation of Indemnity If a Director or Officer is unable to satisfy a right to indemnity against the Corporation to which he or she is entitled, whether under Common Law or Statute, or otherwise, by reason only of the Corporation being placed in liquidation (other than voluntary liquidation) and having insufficient funds available so to indemnify the Director or Officer, then it is hereby agreed that the Insurer shall indemnify the Director or Officer to the extent that the Director or Officer is unable to satisfy the right to indemnity against the Corporation. The burden of adducing satisfactory proof to obtain the benefit of this extension shall rest entirely with the Director or Officer and shall include the production of documentary evidence of the Corporation's assets and liabilities and any official statements issued by the liquidator." Section 3 of the policy states the exclusions relevantly as follows: "This Policy does not provide an indemnity against any Claim made against any Director or Officer: 3.1 Dishonesty & Fraud brought about by, contributed to by or which involves: Callinan the dishonest, fraudulent or malicious act or omission or other act or omission committed with criminal intent of such Director or Officer; such Director or Officer having improperly benefited in fact from securities transactions as a result of information that was not available to other sellers and/or purchasers of such securities; or such Director or Officer having gained in fact any personal advantage to which he/she was not legally entitled. However, this exclusion shall only apply to the extent that the subject conduct has been established by a judgement or other final adjudication adverse to the Director or Officer." Section 4.4, one of the general conditions of the policy should be noted: "4.4 Claims Co-operation The Directors and Officers shall use due diligence and do and concur in doing all things reasonably practicable to avoid or diminish any Loss hereunder, and shall immediately give all such information and assistance to the Insurer as it may reasonably require to enable it to investigate and to defend the Claim and/or to enable the Insurer to determine its liability under this Policy. The Insurer may, on request from the Directors and Officers for indemnity under this Policy, take whatever action that it considers appropriate to protect the Directors' and Officers' position in respect of the Claim and such action by the Insurer shall not be regarded as in any way prejudicing its position under this Policy and no admission of the Director's and Officers' entitlement to indemnity under this Policy shall be implied." Section 4.5 may also be relevant for its use of the word "advance". "4.5 Allocation In the event of a Claim which is made against Directors and Officers or the Corporation and which is covered only partly by this Policy, the Insurer will use its best efforts to ensure a fair and proper allocation of the claim for insured and uninsured portions. The Insurer will also advance Defence Costs on a similar basis, which will apply to all Defence Costs unless otherwise agreed by all parties." Callinan Section 5.1 of the policy defines "Claim" this way: "'Claim' shall mean: any writ, summons, application or other originating legal (criminal, civil or otherwise) or arbitral proceedings, cross claim or counter- claim issued against or served upon any Director or Officer alleging any Wrongful Act; or any written demand alleging any Wrongful Act communicated to any Director or Officer under any circumstances and by whatever means." Section 5.3 defines "Defence Costs" this way: "'Defence Costs' shall mean: all reasonable costs, charges and expenses (other than regular or overtime wages, salaries or fees of any Director or Officer) incurred with the prior written consent of the Insurer in defending, investigating, attending or monitoring any Claim or proceedings, including but not limited to official investigations, examinations, inquiries and the like, or appeals therefrom, together with all reasonable costs of bringing any appeal." Section 5.8 defines "Loss" as follows: "'Loss' shall mean: the amount payable in respect of a Claim made against the Directors and Officers for a Wrongful Act and shall include damages, judgements, settlements, interest, costs and Defence Costs. In respect of Section 2.5 (Insured vs Insured Cover) and 2.20 (Entity Cover for Employment Practices Liability) this Policy will include back-pay where reinstatement by a court is ordered but excludes any amount which the Insured is or was required to pay pursuant to a specific obligation imposed under a contract of employment, employment agreement, statute, award or otherwise. 'Loss' excludes a Claim arising from or by reason of or directly or indirectly caused by or arising from fines and penalties imposed by law, punitive, exemplary or aggravated or multiple damages, income tax, customs duties, excise duty, stamp duty, sales tax or any other State or Federal tax or duty." I would also set out the definition of "Wrongful Act" (Section 5.18) to underline the point made by Hodgson JA in the Court of Appeal that "questions of honesty Callinan of conduct of directors and officers of companies are often difficult and marginal"25. "'Wrongful Act' shall mean: any actual or alleged breach of duty, breach of trust, neglect, error, misstatement, misleading statement, omission, breach of warranty of authority or other act done or attempted by or any other matter claimed against any Director or Officer or any of them wherever or whenever while acting in their individual or collective capacities as Directors or Officers." The respondent accepts that there is an entitlement under the indemnity given by the policy to be paid "Loss" (which includes "Defence Costs") but that there is no entitlement to be paid any amount of such costs in advance, save to the extent provided for by cl 2.1 which sets out the specific circumstances in which there may be an advance in respect of matters falling within "Defence Costs". Unless there has been an exercise by the respondent of its discretion under cl 2.1, there is no right in the appellants to insist upon payment of their defence costs in advance. The respondent also accepts that a refusal of the respondent to pay defence costs in accordance with the second paragraph of cl 2.1 may be challenged on the basis that the consent was unreasonably withheld. Consent may not however be regarded as unreasonably withheld in circumstances in which there is a bona fide contention by the respondent that there had been conduct of the nature referred to in the last paragraph of cl 3.1, or, as contended here, that the policy had been avoided. The respondent then makes the points that the appellants accepted (for the purpose of their determination of the questions) that the issues should be decided on the assumption that the respondent's pleaded allegations were true, and that it was entitled to, and has avoided the policy by reason of the appellants' non-disclosure before it was effected. The respondent seeks to meet the appellants' argument that the exception contained in cl 3.1 uses the past tense: "... has been established" in this way. The opening words of cl 3.1 limit the ambit of the indemnity otherwise provided by the policy, but that limit is not a temporal one: rather, it contemplates that the conduct excluded from the indemnity must be conduct found by a judgment or other final adjudication to be of the nature referred to in one of the three earlier paragraphs of cl 3.1. To treat a provision such as the last paragraph of cl 3.1 as extending the ambit of the indemnity beyond that elsewhere granted by the policy, whilst possible, would be heterodox. 25 (2003) 57 NSWLR 469 at 481 [48]. Callinan Secondly, there may, or may not be proceedings between the insured and a third party in which the question which is raised by the last paragraph of cl 3.1 would fall to be decided. It would be curious if that question were not to be resolved in the ordinary manner in which disputes between insured and insurer are resolved, that is, in an action between those parties, giving rise to a judgment establishing whether the conduct that attracts the operation of the exclusion had occurred. The appellants – not having appealed in respect of Question 2 – appear to have accepted this basic proposition, but yet contend that there is an entitlement to be paid costs, in advance, notwithstanding that they will or may have ultimately to refund them. The appellants' contention cannot be correct because it would extend the indemnity beyond that accorded by the other parts of the policy. Further, the appellants' contentions would require the implication of a right to recover the amounts in advance of the appellants' action against the respondent being decided in the respondent's favour in circumstances attracting the last paragraph of cl 3.1. This, it was submitted, would be surprising in the light of the specific attention devoted to the topic in the third paragraph of cl 2.1. Finally, the respondent submits that the answer to Question 1 proposed by the appellants is inconsistent with the answer to Question 2. If the reasoning contended for by the appellants were accepted, a different and more limited answer would be appropriate. It is submitted even if Question 1 should be answered along the lines contended for by the appellants, there would still be no entitlement to payment of defence costs having regard to the respondent's defence of avoidance of the policy. There is force in the respondent's submissions in relation to the form of question as posed to the Court. The difficulties to which the form of the question gave rise troubled Hodgson JA in the Court of Appeal as to which his Honour said this26: "It follows that the answers to question 2 and question 3 given below are correct. The answer to question 1, however, could be misleading. It is true that the cl 3.1 defence can be relied on in the sense that it can be raised as a defence in insurance proceedings; but it cannot be relied on in the sense that cl 3.1 does not provide a valid justification for refusal of indemnity unless and until the fourth paragraph is satisfied. So I would propose that question 1 be answered yes, but only in the sense and subject to the qualifications set out in my reasons." 26 (2003) 57 NSWLR 469 at 484 [60]. Callinan In substance, the qualifications to which his Honour was referring were that the respondent could rely on the exclusion in cl 3.1 in proceedings between it and the appellants. If cl 3.1 were the only defence, then until that defence were established, the respondent would be in breach in not providing indemnity. The only relevant implied term, his Honour thought, was that the respondent should not rely on cl 3.1 in any way which would be a breach of its obligation of good faith. The appellants were invited during the hearing of the appeal, to, and did formulate the question differently. It now reads as follows: "Whether the defendant can or cannot plead exclusion cl 3.1 by way of defence to the plaintiff's claim for the Defence Costs which have been incurred by the plaintiff unless and until there has been a judgment, order, or other final adjudication adverse to the plaintiff establishing the subject conduct identified in cl 3.1." The proper construction of the policy In my opinion the appellants have the better of the arguments on the construction of the policy. This is so for several reasons. Matters relevant to the proper approach to the construction of the policy are these: that the respondent is the profferer of the policy, that it is a policy designed to operate in the commercial environment of directors' (and other officers') obligations, and the ascertainment of an uncertain dividing line between dishonesty, and gross negligence, or imprudence to which Hodgson JA referred; and that the section in particular contention, cl 3.1, is an exclusion clause. These matters require that ambiguities in the construction of the exclusion clause, indeed in other parts also of the respondent's policy, be resolved in favour of the appellants. That is not to go as far as a body of North American authority holds in relation to a like, but as will appear, far from identical form of policy, that any ambiguity must be construed strictly against the insurer, and, of more importance, in such a way as to prefer the insured if the policy "contains contradictory provisions, or has been so framed as to leave room for [a] construction, rendering it doubtful [what] the parties intended"27. The contra proferentem rule makes it just that this be the 27 National Bank v Insurance Company 95 US 673 at 678-679 (1877) per Harlan J giving the opinion of the Court. See also Atlantic Permanent Federal Savings & Loan Association v American Casualty Company of Reading, Pennsylvania 670 F Supp 168 at 171-172 (ED Va 1986); National Union Fire Insurance v Seafirst Corporation 662 F Supp 36 at 38 (WD Wash 1986); Little v MGIC Indemnity Corporation 649 F Supp 1460 at 1467-1468 (WD Pa 1986); Okada v MGIC Indemnity Corporation 823 F 2d 276 at 282 (9th Cir 1986); National Union Fire Insurance Company of Pittsburgh, Pa v Continental Illinois Corporation 666 F Supp 1180 at 1197-1198 (ND Ill 1987); American Casualty Co of Reading, (Footnote continues on next page) Callinan result28. There is another reason why the United States authorities may be distinguished, and that is that the standard form there expressly refers to a judgment in third party proceedings, and not to proceedings between insurer and insured29. A convenient starting point for the consideration of the arguments is the definition of "Defence Costs". Two observations may be made about that. First, the definition refers to reasonable costs, and secondly to the incurring of them [only] with the prior written consent of the respondent. The language of the definition does tend to suggest that the respondent has a discretion with respect to the provision of indemnity against costs. Such a discretion could not be an unfettered one. If it were, the acceptance of the risk, that the insureds might be sued and incur costs in defending actions against them, would be meaningless and of no value. Section 1 of the policy states the respondent's obligations, and the risks in respect of which it has undertaken to insure, that is, the consideration for the premium paid. The policy is a "claims made" policy, and the reference in the Section to time is the "Indemnity Period". It says nothing about the time at which indemnity is to be provided. Ordinary principles of construction would suggest on, or within a reasonable time of the realization of the risk. The requirement of notification during the indemnity period is however significant. A matter of frequent controversy in respect of claims made under Pennsylvania v Bank of Montana System 675 F Supp 538 at 541-544 (D Minn 1987); National Union Fire Insurance Company of Pittsburgh, Pa v Brown 787 F Supp 1424 at 1429, 1433-1434 (SD Fla 1991); Graham v Preferred Abstainers Insurance Company 689 So 2d 188 (1997); Associated Electric & Gas Insurance Services Ltd v Rigas 2004 US Dist LEXIS 4498, and criticisms of that approach in Miller, "Insurance as Contract: The Argument for Abandoning the Ambiguity Doctrine", (1988) 88 Columbia Law Review 1849. 28 National Bank v Insurance Company 95 US 673 at 679 (1877). 29 Pepsico Inc v Continental Casualty Company 640 F Supp 656 at 659-660 (SDNY 1986); Atlantic Permanent Federal Savings & Loan Association v American Casualty Company of Reading, Pennsylvania 670 F Supp 168 at 170-171 (ED Va 1986); Atlantic Permanent Federal Savings & Loan Association v American Casualty Company of Reading, Pennsylvania 839 F 2d 212 at 216 (4th Cir 1988); National Union Fire Insurance v Seafirst Corporation 662 F Supp 36 at 38-39 (WD Wash 1986); Okada v MGIC Indemnity Corporation 823 F 2d 276 at 282 (9th Cir 1986); Little v MGIC Indemnity Corporation 836 F 2d 789 at 792-794 (3rd Cir 1987). Callinan policies of this kind is whether the claim against the insured has been made and notified under the policy while it is still current. Section 1 makes explicit the necessity for this currency. That this is so sheds some light upon the meaning to be given to the next section of the policy. The first paragraph of cl 2.1 uses the word "elects". The right that it confers upon the respondent is not an unfettered one. It is certainly not a right to elect to avoid its obligations under the policy. It requires that the respondent pay defence costs "as they are incurred and prior to the finalisation of the Claim", subject to a proviso that I refer to below. It will be recalled that the conclusion of Tobias JA in the Court of Appeal depended in part at least upon his Honour's view that if the respondent were obliged to pay costs in advance, it would, by parity of reasoning, also be obliged to pay a judgment in advance, even if it were locked in a dispute about its obligations to its insureds30. That reasoning overlooks that the first paragraph of cl 2.1 expressly distinguishes between costs, and the claim against a director. The former are expressly stated to be payable even if that claim has not been finalized. All of this is subject to the proviso appearing in the first paragraph of cl 2.1 "... that indemnity in respect of such Claim has been confirmed in writing by the [respondent]." One possible reading of that is "... that the respondent has first confirmed in writing that it accepts that it is liable to indemnify the insured if his liability on the claim is established." But if that were the sense intended, why did the respondent not express itself in that, or some equally clear fashion? What meaning must be given to the words "indemnity ... confirmed"? They certainly do not necessarily carry the sense for which the respondent contends. Nor do they necessarily convey this meaning, "... that the respondent has first confirmed in writing that the claim has been made within the indemnity period", but they are in my opinion capable of doing so, and should be held here as in fact doing so. Cryptic expression invites, indeed compels, some measure of invention on the part of a court required to give meaning to it. The reference, in the second paragraph of cl 2.1 to "discretion" should be read as a discretion with respect to the quantum of the costs in question, particularly because, as the paragraph states, consent may not be unreasonably withheld. The third paragraph of cl 2.1 is consistent with the constructions that I have preferred for the preceding paragraphs. It makes it entirely clear that the occasion may arise for the subsequent repayment of costs to the insurer, that is, if it is subsequently established by judgment or final adjudication that the insureds were not so entitled. The paragraph could hardly more clearly recognize and acknowledge the real likelihood that defence costs will be payable and received in advance, probably often long in advance of any kind of adjudication upon any 30 (2003) 57 NSWLR 469 at 487 [75]. Callinan alleged disentitling conduct of directors and officers. Clause 2.1 of the policy clearly is concerned, among other matters, with matters of timing. It is also consistent, construed this way, with cl 4.5 which expressly refers to the payment in advance of defence costs. Clauses 2.6 and 2.11 need no further reference except to point out, as to the former, that it is concerned with the exercise, reasonably, of the respondent's discretion as to the quantification of costs, and that it also recognizes the difference between an allegation of a wrongful act and its ultimate establishment. The latter, cl 2.11, has this significance. It indicates the circumstances in which claims will most frequently arise, of insolvency of the company, which will almost inevitably mean, a multiplicity of competing claims, disputes, and the assessment in retrospect of commercial decisions taken in an apparently different commercial context. I come then to the exclusion clause, cl 3.1. In my opinion, although of course the policy has to be read as a whole, and to the extent possible, in such a way as to make each term of it harmonize with the balance of it, a consistent line of authority dating from at least 1790, applies to it which requires that a party who seeks to rely upon an exception must first bring the relevant event or circumstances within the letter of it. As Lord Kenyon said in Bowring v Elmslie31: "To let the exception control the instrument as far as the words of it extend, and no further, and then upon the case being taken out of the letter of the exception, the body of the instrument operates in full force." I would not regard what was said by Windeyer J in Thomas National Transport (Melbourne) Pty Ltd v May & Baker (Australia) Pty Ltd32 as other than entirely consistent with Lord Kenyon's statement33: 31 As quoted in Burnett v Kensington (1797) 7 TR 210 at 214 [101 ER 937 at 939], cited with approval in Kettering Pty Ltd v Noosa Shire Council (2004) 78 ALJR 1022 at 1029 [32]; 207 ALR 1 at 10. Whilst it is true that in Burnett v Kensington (1797) 7 TR 210 at 221 [101 ER 937 at 943] Lord Kenyon said that he did not regard what he had said in Bowring as a "judicial authorit[y]", he was unable to "extricate [his] mind from the reasoning that led [him] to the conclusion in [that case]." 32 (1966) 115 CLR 353. 33 (1966) 115 CLR 353 at 376. Callinan "The first is that an 'exemption clause' – or 'exception clause' or 'protective clause', all terms are used – is ordinarily construed strictly against the proferens, the party for whose benefit it is inserted. Secondly, it is not construed as relieving him against liability for the negligence of himself or his servants, unless it expressly or by implication covers such liability." It seems to me that the respondent cannot here bring itself within the wording, let alone the letter of cl 3.1. Its last sentence could hardly be plainer: the exclusion shall only apply to the extent that the subject conduct has been established by a judgment or other final adjudication adverse to the director or officer. Nothing in relation to the nature of the appellants' conduct has been established here by a judgment or other final adjudication. Contrary to the respondent's submission the clause does have temporal connotations, and unmistakable ones at that. This construction, which is a natural one, of the exclusion clause can be reconciled with the terms of the policy to which I have given particular consideration. It follows that I do not agree that the policy was not intended to provide a form of "up-front" indemnity for the defence costs to the insured in these circumstances as Tobias JA held. That the indemnity for costs might, and should be provided in advance was clearly contemplated by cl 2.1 of the policy which made provision, as I have pointed out, for the reimbursement of them upon the subsequent establishment of disqualifying conduct by final adjudication. His Honour also said that the clear structure of the policy entitled the respondent to refuse indemnity if it asserts relevant dishonest conduct34. For the reasons that I have given, which include a need for harmonization of the various terms of the policy, including the several of them that are ambiguous, I would myself have thought that if anything, the structure points in a different direction. His Honour then went on to say that neither the policy nor its commercial purpose required the insurer to advance defence costs if it has denied liability upon any proper ground35. I am unable to agree. What are the realities? They include those to which Hodgson JA referred of the very great difficulty in drawing a line between disqualifying conduct and other conduct36. That there is difficulty in drawing such a line means that claimants (against directors), not improperly, can and will allege dishonesty in cases of the kind in prospect against the appellants here. They also include that the hindsight of those who have suffered as a result of a corporate failure will often differ from the view that directors may have formed 34 (2003) 57 NSWLR 469 at 487 [77]. 35 (2003) 57 NSWLR 469 at 487 [77]. 36 (2003) 57 NSWLR 469 at 481 [48]. Callinan in making their business decisions at the time, and that such hindsight may ultimately turn out to provide an insufficient basis when, but only when, all the facts are in, for an allegation in litigation that there has been dishonest conduct. But perhaps the most striking reality of all is that law suits, either by way of class actions, or a multiplicity of actions, are likely to follow from any corporate collapse, and that directors and officers of the corporation denied the means of defending themselves, or defending themselves adequately, will also be denied, by an absence of means, the opportunity of refuting allegations of disqualifying conduct. There is another factor which cannot be ignored in a situation of this kind. It is that in a case of an allegation by a third party of dishonesty, an insurer seeking to rely upon the exclusion is immediately placed in a situation of conflict. If its insured, with or without its assistance, is able to defend and repel the claims of dishonesty (as well of course as any other claims made against the insured) the insurer too will escape liability to indemnify the insured. But if of course the claims of dishonesty can be made out against the insured, then the insurer will also escape liability. The insurer in the latter of those circumstances has the same interest as the claimant, and in pitting itself against the insured in the same way, by alleging dishonesty against him. This important factor in my opinion also argues in favour of the construction of the policy which I prefer. An insured should not be denied at least the means of enabling him to seek to refute the claims against him in litigation, and it is to this reality in my view that Section 2 of the policy is addressed. The countervailing risk to the insurer, that if dishonesty be found, it may not be able to obtain reimbursement from its insured, is a risk that the respondent took by writing the policy in the way that it did. All that I need add in relation to this aspect of the case is that for the reasons I have given in Wilkie v Gordian Runoff Ltd37, the construction of the policy and the application of the contra proferentem rule should not be affected by the fact that the appellants themselves may have been aggressively engaged in a highly competitive business. What I have so far decided does not however resolve these appeals. The respondent submitted that it had avoided the policy under s 28(2) of the Insurance Contracts Act and that accordingly questions of construction of the policy cannot arise. I would reject that submission. A policy is not avoided in case of dispute as here, under that Act, unless and until the insured accepts that the policy has been avoided or a court holds that to be so. Otherwise the insurer would be the final arbiter of an issue of this kind. It is certainly true that sometimes a decision on one issue in a case will eliminate the need for decision on other issues in it, but whether that will be so will only be known when the 37 [2005] HCA 17. Callinan case is heard and decided. The submission that the appellants admitted dishonesty as a condition of the entertainment of the summons by the Supreme Court, should also be rejected. That admission was made solely for that purpose, and provides no basis for the avoidance of the policy at this stage. The respondent also submits, that the allegations of dishonesty justifying its avoidance of the policy are so intertwined with the allegations of dishonesty entitling it to rely upon the exclusion clause, that it would be wrong for costs to be advanced in respect of the defence of similar claims to the latter made by third parties. I do not think that this is so. The allegations may be the same, or similar or intertwined, but the issues, of avoidance, and reliance upon the exclusion clause, are quite different and may involve different judicial approaches to their resolution. The appellants still have however two hurdles to surmount. One is the reconciliation of the answer that they seek to Question 1, with the answers to the other two questions which the appellants have accepted, by not appealing in respect of them. The other is the related question, whether, in any event there is any utility in the litigation in giving the answer that they seek to Question 1, which has, as I have pointed out, been reformulated. The reformulation asks whether the respondent can, or cannot plead the exclusion by way of defence to the appellants' claim for defence costs if there has not been a final adjudication adverse to the appellants establishing disqualifying conduct. It seems to me that the appellants, having commenced proceedings for the defence costs against the respondent, must face the initial certainty that the respondent can, and will plead the exclusion in attempted answer to the claim. That is a different question from a question for example, whether the respondent is bound to advance the costs before any final adjudication of disqualifying conduct is made. Had that been the question, then subject to the reconciliation of an affirmative answer to it with the answers given to the other questions I would have been inclined to answer it favourably to the appellants. But the appellants having started the proceedings, having pressed for early resolution of them without a full scale trial, having been party to the questions in their original form, and having reformulated the first one as they have, must bear the consequence, which is that there would be no utility in answering the reformulation in the way sought by the appellants. By accepting the answer to Question 2 the appellants have accepted that in these proceedings, the respondent is entitled to have an adjudication upon the appellants' conduct. Such an adjudication would not be available and possible, unless the respondent properly raises disqualifying conduct, and the exclusion, by properly pleading it. The answer sought by the appellants to Question 1 is therefore inconsistent with the answer, accepted as correct, to Question 2. And if I take Question 3, as I think it is intended to do, as seeking a declaration that the respondent is obliged to pay defence costs in advance, then the answer given to it Callinan adverse to the appellants and accepted by them by their not appealing against it, really renders moot the answer sought by the appellants to reformulated Question 1. Having regard to these last matters, even though I am of a different view with respect to the construction of the policy from the view of the Court of Appeal and Gleeson CJ, McHugh and Gummow JJ, I would join in the orders that their Honours propose, that the application for special leave be revoked with costs.
HIGH COURT OF AUSTRALIA X & ORS AND APPELLANTS AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY & ANOR RESPONDENTS X v Australian Prudential Regulation Authority [2007] HCA 4 21 February 2007 ORDER Set aside Paragraph 1 of the orders of the Full Court of the Federal Court of Australia made on 22 March 2006 in each of matters numbered NSD 1793 of 2005 and NSD 1794 of 2005 and in its place order that: Paragraph 2 of the orders made by Lindgren J on 16 September 2005 is varied to the extent necessary to provide that Question B: "Does the use by the first or second respondent of the evidence of the first applicant before the HIH Royal Commission contravene ss 6DD or 6M of the Royal Commissions Act 1902 (Cth)?" is answered "The answer to the question is governed by the construction of s 6M alone, and so understood is 'No'." The appeal is otherwise dismissed. Otherwise, appeal dismissed with costs. On appeal from the Federal Court of Australia Representation D F Jackson QC with D Hogan-Doran for the appellants (instructed by Minter Ellison) D M J Bennett QC, Solicitor-General of the Commonwealth with J W J Stevenson SC, M N Allars and V E Whittaker for the respondents (instructed by Sparke Helmore) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS X v Australian Prudential Regulation Authority Administrative law – Judicial review – Injunction and declaratory relief – s 39B of the Judiciary Act 1903 (Cth) – Whether the appellants are entitled to an order restraining the Australian Prudential Regulation Authority ("APRA") from acting on a "preliminary view" formed by its Senior Manager that the first and third appellants were not "fit and proper" to act as senior managers of a foreign general insurer. Administrative law – Royal Commissions – Protection of witnesses – s 6M of the Royal Commissions Act 1902 (Cth) – Appellants gave evidence at the HIH Royal Commission – Whether s 6M prevents the use of that evidence by APRA in deciding whether to disqualify the first and third appellants pursuant to s 25A of the Insurance Act 1973 (Cth) – Whether potential disqualification caused a "disadvantage" to the appellants – Whether potential disqualification arose "for or on account of" the first and third appellants' evidence to the Royal Commission – Whether the proper exercise of APRA's statutory powers and functions may constitute a "disadvantage" arising "for or on account of" evidence given before a Royal Commission. Insurance –– Prudential regulation – Disqualification – APRA may take steps pursuant to s 25A of the Insurance Act 1973 (Cth) where a person is not "fit and proper" to act as a senior manager of a foreign general insurer – Whether APRA may take into account evidence given at a Royal Commission by or about that person – Whether s 6M of the Royal Commissions Act 1902 (Cth) prevents the use of such evidence for the purposes of s 25A of the Insurance Act 1973 (Cth). Statutes – Interpretation – Whether s 6M of the Royal Commissions Act 1902 (Cth) distinguishes between the giving of evidence and the content of the evidence so given. Words and phrases – "for or on account of", "disadvantage". Insurance Act 1973 (Cth), s 25A. Royal Commissions Act 1902 (Cth), s 6M. GLEESON CJ, GUMMOW, HAYNE, CALLINAN, HEYDON AND CRENNAN JJ. By Letters Patent dated 29 August 2001 which were expressed to be issued by the Governor-General pursuant to the Constitution, the Royal Commissions Act 1902 (Cth) ("the Royal Commissions Act") and what were described as "other enabling powers", a Commissioner was appointed to inquire into the reasons for and circumstances surrounding the failure of the HIH Insurance Group ("HIH") prior to the appointment of provisional liquidators on 15 March 2001 ("the HIH Royal Commission")1. This litigation arises from steps taken by a federal regulatory body in reliance upon documentary and oral evidence presented to the HIH Royal Commission. The parties The second appellant ("Z") is a foreign corporation incorporated in Germany. Z conducts an international reinsurance business. It is authorised to carry on insurance business in Australia by the first respondent, the Australian Prudential Regulation Authority ("APRA"), pursuant to s 12(2) of the Insurance Act 1973 (Cth) ("the Insurance Act") and does so as a "foreign general insurer" within the meaning of s 3 of the Insurance Act. A foreign general insurer which, like Z, is a body corporate not incorporated in Australia is required by s 118 of the Insurance Act to be represented in Australia by an individual resident here and appointed as its agent for the purposes of that Act. However, this does not affect the position of the first appellant ("X") and the third appellant ("Y"). They are employed by Z in senior management positions outside Australia. Z produced documents to the HIH Royal Commission in response to a notice issued pursuant to s 2 of the Royal Commissions Act. X and Y each travelled to Australia and furnished to the HIH Royal Commission a statement and gave oral evidence. The first respondent, APRA, is established as a body corporate by ss 7 and 13 of the Australian Prudential Regulation Authority Act 1998 (Cth) ("the APRA Act"). The second respondent ("Mr Godfrey") is Senior Manager of APRA. Section 9 of the APRA Act states that APRA has the functions conferred upon it by the APRA Act and any other law of the Commonwealth. Section 8 of the Insurance Act vests in APRA the general administration of that statute. The 1 The terms of reference were amended on 6 February 2002, 2 May 2002 and 23 January 2003, but nothing for present purposes turns upon those amendments. Crennan main object of the Insurance Act is to protect the interests of policyholders and prospective policyholders under insurance policies issued by general insurers and Lloyd's underwriters and to do so "in ways that are consistent with the continued development of a viable, competitive and innovative insurance industry" (s 2A(1)). The disqualification procedures Reference should now be made to Pt III Div 5 (ss 24-27) of the Insurance Act. This Division confers on APRA powers to "disqualify" persons who then, under pain of criminal sanction, are not to act, among other capacities, as a senior manager or agent in Australia of a foreign general insurer (s 24(1)(b)). APRA may disqualify a person "if it is satisfied that the person is not a fit and proper person to be or to act" in such a capacity (s 25A(1)). The "preliminary view" of APRA On 18 February 2005, Mr Godfrey wrote letters to each of X and Y giving them the opportunity to make submissions as to why APRA should not decide to disqualify them under s 25A(1). The letters stated a "preliminary view" of Mr Godfrey that the addressee was not a fit and proper person to be the holder of the senior insurance roles referred to in s 24(1) of the Insurance Act. Attached to each letter sent by Mr Godfrey was an annexure (with copies of documents) setting out information that Mr Godfrey had considered in reaching his preliminary findings. documentary evidence provided to the HIH Royal Commission and to various items of oral evidence given to that body by X and Y. Mr Godfrey wrote that, in forming his preliminary conclusion, he had had regard to the submissions of Counsel Assisting the HIH Royal Commission and the Commission's findings in its Final Report. He also noted that a complete transcript of the hearings was available on the HIH Royal Commission website. Detailed references were made The solicitors for the appellants responded on 4 May 2005 by detailed letter to Mr Godfrey. The solicitors noted that the Insurance Act provided a procedure for internal review within APRA and then for review by the Administrative Appeals Tribunal ("the AAT") of any decision that was made to disqualify X and Y. However, the solicitors stressed their view that the very publication of the initial decisions would cause detriment to their clients, including the need to meet obligations to inform regulatory authorities in other countries. The solicitors went on to contend that any subsequent decision to Crennan disqualify X and Y pursuant to s 25A of the Insurance Act upon the bases put forward in the letters of 18 February 2005 would be beyond power and would be unlawful and the commission of an offence under the Royal Commissions Act. involve The Federal Court proceedings Something more should be said here respecting the avenues for administrative and judicial review of disqualification decisions by APRA made in exercise of its powers under the Insurance Act. A request for internal review by APRA may be made under s 63(2); applications then may be made to the AAT for review of decisions of APRA affirmed or varied under that procedure (s 63(7)). From the AAT, there is an "appeal" to the Federal Court on a question of law. This is provided by s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act"). In addition, disqualification decisions by APRA answer the definition of decisions to which the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act") applies, and are not excluded by Sched 1 thereof. However, the appellants chose another avenue of judicial intervention to bring to a halt any further proceedings by APRA upon the preliminary views formed by Mr Godfrey. Section 39B of the Judiciary Act 1903 (Cth) relevantly confers original jurisdiction upon the Federal Court with respect to any matter in respect to which an injunction is sought against an officer of the Commonwealth (s 39B(1)) and in any matter arising under any laws made by the Parliament (s 39B(1A)(c)). The appellants instituted proceedings in the Federal Court seeking, together with declaratory relief, an order restraining APRA from taking any further action with respect to X and Y pursuant to s 25A(1) of the Insurance Act2. The substance of the declaratory relief that was sought was that APRA did not have the power to disqualify X and Y pursuant to s 25A(1) of the Insurance Act, with the consequence that it was acting and proposing to continue to act in excess of its jurisdiction. 2 Section 50 of the Federal Court of Australia Act 1976 (Cth) empowers that Court by order to forbid the publication of the name of a party. Where, as here, in proceedings in the court below a party was identified by use of initials or a pseudonym, that identification continues in this Court unless a contrary order is made by the Court or a Justice (Practice Direction No 1 of 1999). Crennan The primary judge (Lindgren J)3 described the case for the lack of power as resting upon two alternate grounds. The first was that the power of disqualification was so limited as to apply only to persons who have held senior insurance positions in Australia or intend to do so in the future, neither of which circumstance applied to X or Y. That submission was rejected by Lindgren J and on appeal by Emmett, Allsop and Graham JJ4. A special leave application to this Court to challenge that holding was unsuccessful but special leave was granted to test the holding on the second ground. This appeal thus is concerned with the second of the grounds put forward in support of the case for the absence of power. Lindgren J identified this alternative basis as follows: were APRA to proceed to disqualify X or Y, APRA thereby would be causing to those persons a disadvantage "for or on account of" evidence given by that person to the HIH Royal Commission; this outcome would be an injury by APRA to these witnesses of the kind forbidden by s 6M of the Royal Commissions Act. It should be remarked here that contravention of s 6M is an indictable offence which requires trial by jury pursuant to s 80 of the Constitution5 and which attracts a penalty of $1,000, or imprisonment for one year. This second ground in support of the absence in APRA of a power of disqualification otherwise conferred by s 25A(1) of the Insurance Act thus makes several assumptions respecting the application to APRA of s 6M of the Royal Commissions Act. It would require the clearest of intentions that the penalties provided by s 6M would apply to the Commonwealth and none is apparent in the Royal Commissions Act6; and there may be a question whether a 3 Applicant X v Australian Prudential Regulation Authority (2006) 14 ANZ Ins Cas 4 Y v Australian Prudential Regulation Authority (2006) 150 FCR 469 at 484. 5 With the consent of the prosecutor and the defendant, the offence may be dealt with summarily: Crimes Act 1914 (Cth), s 4J. 6 Cain v Doyle (1946) 72 CLR 409 at 417-419, 423-426. There is, however, no power in the Crown to dispense its servants or agents from criminal liability for acts forbidden by law: A v Hayden (1984) 156 CLR 532 at 548, 562, 580-581, 593. Crennan "Commonwealth authority" such as APRA7 has the Commonwealth for this purpose8. None of these matters was put in issue and they may be placed to one side. the character of Lindgren J noted that APRA had not yet decided to disqualify X or Y so that arguably the proceedings in the Federal Court were premature. Further, in order to succeed the appellants had to establish that APRA would not lawfully be able to be satisfied that X and Y were not fit and proper persons to be or to act as a senior manager of a foreign general insurer. the However, Lindgren J did not enter upon any questions of inappropriateness of proceeding immediately to decide what appeared to be the basic issues in the case9. By consent of the parties his Honour ordered10 that there be decided separately and before any other question in the proceedings two questions. That which is presently in issue on this appeal read (when later "Does the use by [APRA or Mr Godfrey] of the evidence of [X and Y] before the HIH Royal Commission contravene sub-section 6DD or 6M of the [Royal Commissions Act]?" In the absence of submissions respecting s 6DD, the answer to the question was treated by the primary judge as governed by s 6M alone. His Honour answered the question "No". The Full Court dismissed appeals. 7 APRA Act, s 7; Commonwealth Authorities and Companies Act 1997 (Cth), s 7. cf State Authorities Superannuation Board v Commissioner of State Taxation (WA) (1996) 189 CLR 253 at 270-271, 277, 294. cf Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 355-356 [47]; Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161 at 198 [113]; Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515 at 524-525 [7]. 10 Pursuant to O 29 r 2 of the Federal Court Rules. Crennan The question respecting s 6M was so framed as to embark the Federal Court upon the determination of issues of guilt of an indictable offence by means of a declaration in civil litigation. In Sankey v Whitlam, Gibbs ACJ remarked11: "Most of the cases in which declarations have been made in matters which could have been, or were, the subject of criminal proceedings were cases where the criminal offence consisted of a breach of a regulatory provision, such as a failure to comply with an administrative requirement, a planning provision or a by-law." His Honour went on later in his reasons12: "The power to make declaratory orders has proved to be a valuable addition to the armoury of the law. The procedure involved is simple and free from technicalities; properly used in an appropriate case the use of the power enables the salient issue to be determined with the least possible delay and expense. But the procedure is open to abuse, particularly in criminal cases, and if wrongly used can cause the very evils it is designed to avoid." In argument in this Court, reference was made to the declaratory relief granted against the respondent in Ainsworth v Criminal Justice Commission13. But, in Ainsworth, the jurisdictional error of the Commission lay in its denial of procedural fairness to the appellants, and in the circumstances mandamus was an inappropriate remedy and certiorari did not lie. The present case is not of that nature. There was a real question as to the procedure adopted in this case, but because the appeal to this Court should be dismissed, the matter need not be further pursued here. 11 (1978) 142 CLR 1 at 21. 12 (1978) 142 CLR 1 at 25. 13 (1992) 175 CLR 564 at 581-582. Crennan The appeal to this Court There were two applications for special leave to this Court, one by X and Z and the other by Y and Z. In each case, the grant of special leave was limited to grounds of appeal as follows: The Full Court erred in construing section 6M(b) [of the Royal Commissions Act] as not having the effect of preventing [APRA and Mr Godfrey] from relying on evidence given by a person to a Royal Commission in exercising the power conferred by section 25A of the Insurance Act. The Full Court erred in finding that [Mr Godfrey's] proposal to recommend to the appropriate delegate of [APRA] that [X and] Y be disqualified pursuant to section 25A of the Insurance Act was not prevented by section 6M(b) of the [Royal Commissions Act]." Pursuant to a further order made on the grant of special leave, the appellants have filed the one notice of appeal. Despite the terms of the separate question formulated by the primary judge, it will be apparent from the terms of the grant of special leave that no issue immediately arises concerning the operation of s 6DD of the Royal Commissions Act. The appellants seek to establish the absence of power in APRA to proceed with the question of disqualification by reliance upon what is said to be the impact of s 6M of the Royal Commissions Act. Section 6M of the Royal Commissions Act Section 6M states: "Any person who uses, causes or inflicts, any violence, punishment, damage, loss, or disadvantage to any person for or on account of: the person having appeared as a witness before any Royal Commission; or any evidence given by him or her before any Royal Commission; or the person having produced a document or thing pursuant to a summons, requirement or notice under section 2; Crennan is guilty of an indictable offence. Penalty: $1,000, or imprisonment for 1 year." (emphasis added) "Neither APRA nor Mr Godfrey is displeased that [X and Y] gave evidence before [the HIH Royal Commission] in relation to [Z's] dealings with HIH or any other subject matter. Neither has caused or inflicted, or is causing or inflicting, any disadvantage on [X, Y or Z] on account of [X and Y] having given evidence before [the HIH Royal Commission] on that topic." In dismissing the appeals, the Full Court construed s 6M as being14: "directed to protecting a witness from detriment by reason of having given evidence about particular matters but [as] not intended to protect a witness from detriment by reason of the witness having admitted the pre-existing facts by giving such evidence". The Full Court then applied this distinction to the instant case as follows15: "If Mr Godfrey is causing damage, loss or disadvantage to X [and Y], it is for or on account of the facts, evidence of which was given by X [and Y] before the [HIH Royal Commission], not for or on account of X's [or Y's] evidence." "[Nor] do we need to consider the questions (which were not debated) as to the proper construction of the powers of APRA, the interrelationship of the two Acts and the relevant sections of the Criminal Code Act 1995 (Cth), including the place of any defences to alleged breaches of s 6M founded on a statutory authority or bona fide exercise of public powers." 14 (2006) 150 FCR 469 at 492. 15 (2006) 150 FCR 469 at 492. 16 (2006) 150 FCR 469 at 492-493. Crennan Four things should be said immediately respecting this disposition of the matter by the Full Court. The first is that in this Court the appellants rightly criticise as illusory a distinction between detriment suffered by reason of a party having given evidence about particular matters and detriment suffered by reason of the content of that evidence. The point was made as follows by Lloyd LJ in Attorney General v Royal Society for the Prevention of Cruelty to Animals17 when dealing with a contempt of court matter. His Lordship is reported as saying: "There was no difference between punishing a man for giving evidence and punishing him for the content of his evidence or the manner in which he gave his evidence. If one was contempt so must the other be. Both were calculated to interfere with the course of justice and to deter witnesses from coming forward and telling the truth plainly and frankly as they saw it." Secondly, in its connection with activities of APRA, s 6M must be read in its setting in the Royal Commissions Act as a whole. APRA is an authority responsible for the administration of a law of the Commonwealth, namely, the Insurance Act. Where a Royal Commission obtains information that relates or may relate to a contravention of that law or evidence of a contravention, it may, if in the opinion of the Royal Commission it is appropriate to do so, communicate the information or furnish the evidence to APRA. This follows from s 6P of the Royal Commissions Act. That statute thus contemplates the taking by APRA of steps in its administration of the Insurance Act in reliance upon certain information or evidence obtained by the HIH Royal Commission. Thirdly, s 6M cannot be construed divorced from its association with the contempt power provided by s 6O of the same statute and, more generally, with the law respecting contempt of court and contempt of Parliament. Fourthly, when the legislation is considered in this fashion, the upshot is that the appeal fails and the question respecting s 6M is correctly answered adversely to the appellants but not for the reasons given by the Full Court. In particular, the appellants cannot demonstrate, within the meaning of s 6M, that Mr Godfrey has proceeded as he has, and that APRA will continue to proceed as 17 The Times, Law Report, 22 June 1985. Crennan proposed, "for or on account of" the appearance by X and Y at the HIH Royal Commission or any evidence they gave there. The antecedents of s 6M As enacted in 1902, the Royal Commissions Act contained but eight sections. Section 7(2) gave to every witness summonsed to attend or appearing "the same protection" as a witness in any case tried in this Court. What the statute then did not make clear was the means by which that protection was to be enforced. The Royal Commissions Act was significantly amended by the Royal Commissions Act 1912 (Cth) ("the 1912 Act"). The 1912 Act at the time was described by Harrison Moore as "a very drastic act"18. Provision with respect to contempt was made by s 6O, which is referred to later in these reasons. The section, it should be noted, used the expression "wilful contempt". Section 6M was introduced in a form not greatly different from that which it presently takes19. Section 6M at that time stated: "Any person who uses, causes, inflicts, or procures, any violence, punishment, damage, loss, or disadvantage to any person for or on account of his having appeared as a witness before any Royal Commission, or for or on account of any evidence given by him before any Royal Commission, shall be guilty of an indictable offence. Penalty: Five hundred pounds, or imprisonment for one year." Section 6DD made provision rendering inadmissible in subsequent civil or criminal proceedings in any Australian court (federal, State or Territory)20 18 "Executive Commissions of Inquiry", (1913) 13 Columbia Law Review 500 at 19 The repeal of the original s 6M and the substitution of the present section occurred by Sched 1, Item 4X of the Royal Commissions and Other Legislation Amendment Act 2001 (Cth); Item 4Q substituted s 6DD of the Royal Commissions Act in substantially its present form. 20 The validity of s 6DD with respect to evidence tendered in State courts exercising non-federal jurisdiction was upheld by Griffith CJ and Isaacs J in Colonial Sugar Refining Co Ltd v Attorney-General for the Commonwealth (1912) 15 CLR 182 at (Footnote continues on next page) Crennan statements or disclosures by witnesses in answer to questions put by a Royal Commission21. As Lindgren J pointed out in the present case, s 6DD is not susceptible of "contravention" by any person; "it neither prohibits nor compels, but merely makes certain things inadmissible in evidence". In his Second Reading Speech on the Bill for the 1912 Act, the Attorney- General (Mr W M Hughes) said of what became s 6M22: "A further provision in this Bill is that any person who injures, or causes a witness to be injured, because of his having appeared before a Royal Commission shall be liable to a penalty of £500, or imprisonment for one year." (emphasis added) The side note to s 6M as it appeared in the 1912 Act read: "Injury to witness. Cf Act No 1, 1908 s 10." 196, 218-219; cf Giannarelli v The Queen (1983) 154 CLR 212 at 220; Truong v The Queen (2004) 223 CLR 122 at 162-163 [104]-[106]. 21 Section 6DD in its present form states: "(1) The following are not admissible in evidence against a natural person in any civil or criminal proceedings in any court of the Commonwealth, of a State or of a Territory: a statement or disclosure made by the person in the course of giving evidence before a Commission; the production of a document or other thing by the person pursuant to a summons, requirement or notice under section 2 or subsection 6AA(3). (2) Subsection (1) does not apply to the admissibility of evidence in proceedings for an offence against this Act." 22 Australia, House of Representatives, Parliamentary Debates (Hansard), 24 July Crennan The earlier statute referred to in the side note was s 10 of the Excise Procedure Act 1907 (Cth), which protected in similar terms witnesses appearing on an application under s 2(d) of the Excise Tariff 1906 (Cth) (No 16 of 1906)23. The provenance of the text of these Australian provisions lay in what was then recent United Kingdom legislation. This was the Witnesses (Public Inquiries) Protection Act 1892 (UK)24 ("the 1892 Act"). The public inquiries with which that statute was concerned were identified as including those held by Royal Commissions and by committees of either House of Parliament and pursuant to any statutory authority (s 1). It is convenient here to set out the text of s 2 of the 1892 Act, the affinity with s 6M being apparent: "Every person who commits any of the following acts, that is to say, who threatens, or in any way punishes, damnifies, or injures, or attempts to punish, damnify, or injure, any person for having given evidence upon any inquiry, or on account of the evidence which he has given upon any such inquiry, shall, unless such evidence was given in bad faith, be guilty of a misdemeanor, and be liable upon conviction thereof to a maximum penalty of one hundred pounds, or to a maximum imprisonment of three months." The side note to s 2 read: "Persons obstructing or intimidating witnesses guilty of misdemeanor." Nineteenth century and earlier precedents in the Houses of Parliament at Westminster treated as a breach of privilege any molestation of witnesses on account of their attendance or testimony as witnesses of either House or before committees of either House. In the fifth edition of his work, A Treatise on the 23 This provision excluded from excise duties certain agricultural machinery manufactured under conditions as to remuneration of labour which on application to the President of the Commonwealth Court of Conciliation and Arbitration were declared to be fair and reasonable. 24 55 & 56 Vict c 64. Crennan Law, Privileges, Proceedings, and Usage of Parliament, published in 1863, Erskine May, having considered the precedents, wrote25: "Witnesses, petitioners, and others, being thus free from arrest while in attendance on Parliament, are further protected, by privilege, from the consequences of any statements which they may have made before either house; and any molestation, threats, or legal proceedings against them, will be treated by the house as a breach of privilege." The 1892 Act provided a more convenient machinery for punishing those in contempt of Parliament, the procedure of bringing the parties to the bar of the House being too cumbrous; the substitute provided was to bring such persons before the courts of law. However, as Lord Denning MR emphasised in Attorney-General v Butterworth26, the 1892 Act did not alter the nature of a contempt, but only the procedure for bringing contemnors to account. In Butterworth, the Master of the Rolls asked why the 1892 Act was limited to contempts of the Parliament and of Royal Commissions, expressly excluding inquiries by courts, and answered the question27: "Not because the victimisation of witnesses before the court was any less reprehensible, but because the courts have their own machinery at hand for dealing with victimisation, namely, their power to bring offenders before them for contempt of court, and, I would add, the remedy to a person aggrieved of bringing an action for the wrong done." In the same case, Donovan LJ observed28: "The exclusion of a court of justice from the definition of 'inquiry' contained in section 1 [of the 1892 Act] can be reasonably explained only on the ground that Parliament considered courts of justice as already possessing a corresponding jurisdiction." 26 [1963] 1 QB 696 at 720. 27 [1963] 1 QB 696 at 721. 28 [1963] 1 QB 696 at 724. Crennan Royal Commissions and parliamentary privileges Something now should be said of the position respecting commissions in England before the 1892 Act. The general history of that subject, with particular reference to the relationship with the criminal law and the judicial power and the need for statute to provide coercive means to supplement the prerogative, has been traced in earlier judgments in this Court, particularly by Griffith CJ in Clough v Leahy29, by Dixon J in McGuinness v Attorney-General (Vict)30 and by Brennan J in Victoria v Australian Building Construction Employees' and Builders Labourers' Federation31. This appeal requires attention to a narrower subject, the protection afforded witnesses. Specific commissions were established in the latter part of the nineteenth century by the Trades Union Commission Act 1867 (UK)32, the Belfast Commission Act 1886 (UK)33, the Metropolitan Board (Commission) Act 1888 (UK)34 and the Special Commission Act 1888 (UK)35. The second and fourth of these acquired some fame as "the Belfast Riots" Commission and "the Parnell Commission"36. In each case, powers of punishment for contempt were conferred upon the Commissioners and were identified as corresponding to those of the High Court of Justice in England or Ireland as the case may be. Provisions rendering statements by witnesses inadmissible in later proceedings in terms similar to those later found in Australia in s 6DD of the 29 (1904) 2 CLR 139 at 155-161. 30 (1940) 63 CLR 73 at 93-102. 31 (1982) 152 CLR 25 at 147-158. 32 30 Vict c 8. 33 50 Vict c 4. 34 51 Vict c 6. 35 51 & 52 Vict c 35. 36 Harrison Moore, "Executive Commissions of Inquiry", (1913) 13 Columbia Law Review 500 at 507-508. Crennan Royal Commissions Act also were made in this earlier English legislation. The occasion for such provision may have been a perceived need to overcome the ruling by Abbott J in R v Merceron37. On a trial of a magistrate for corruptly granting licences to public houses which were his own property, Abbott J ruled that there might be admitted evidence of what he had said in the course of his examination before a committee of the House of Commons. His Lordship overruled the objection that the evidence was inadmissible because it had been made under compulsory process from the House of Commons and under pain of punishment for contempt. Subsequently, in McGuinness38, Latham CJ saw provisions such as s 6DD as avoiding usurpation of the functions of a court of justice. The provision in the 1892 Act of additional means, through the criminal law, of dealing with conduct victimising witnesses which otherwise would be punishable only by the processes of contempt has been influential in framing the federal law of this country, not only the Royal Commissions Act39. The Final Report of the Joint Select Committee on Parliamentary Privilege40 was presented in October 1984. Paragraph 9.5 stated: "We think the position of witnesses demands special attention, and that legislation to protect witnesses should be enacted. If this view is accepted, it would follow that there would co-exist with the power to treat interference with witnesses as contempt a specific sanction under the criminal law and a specific civil remedy. We do not think this presents a real practical difficulty. So far as we are aware the co-existence of sanctions available to Parliament and within the courts in the United Kingdom since 1892 has occasioned no difficulties." 37 (1818) 2 Stark 366 [171 ER 675]. 38 (1940) 63 CLR 73 at 84. 39 The colonial and State legislation in Australia at the time of the enactment of the Royal Commissions Act is detailed in Hallett, Royal Commissions and Boards of Inquiry, (1982) at 90-91 and McClemens, "The Legal Position and Procedure Before a Royal Commissioner", (1961) 35 Australian Law Journal 271 at 272-274. 40 Under the Chairmanship of Mr J M Spender, QC, MP. Crennan The Committee went on to refer to specific provision of that nature already made by s 19 of the Public Accounts Committee Act 1951 (Cth)41 and s 32 of the Public Works Committee Act 1969 (Cth)42. Section 12(2) of the Parliamentary Privileges Act 1987 (Cth) now states: "A person shall not inflict any penalty or injury upon, or deprive of any benefit, another person on account of – the giving or proposed giving of any evidence; or any evidence given or to be given, before a House or a committee. Penalty: in the case of a natural person, $5,000 or imprisonment for 6 months; or the case of a corporation, $25,000." (emphasis added) The resemblance between s 12(2) of this statute and s 6M of the Royal Commissions Act will be apparent, in particular the use of the causal or connecting phrase "on account of". It is upon the statutory criterion of cause or connection between the appearance as a witness or giving of evidence and the injury sustained by that person that the outcome of this appeal turns. Contempt and the reasoning in Butterworth In construing s 6M, regard must be paid to s 6O, dealing with contempt of a Royal Commission. A person "in any manner guilty of any intentional contempt of a Royal Commission" is guilty of an offence (s 6O(1)). The displacement of "wilful" by "intentional" by an amendment 41 Now renamed the Public Accounts and Audit Committee Act 1951 (Cth). 42 In addition, the Petrov legislation, the Royal Commission on Espionage Act 1954 (Cth), had included in s 22 a restatement of s 6M of the Royal Commissions Act in substantially the same terms. Crennan accommodates the operation of the Criminal Code (Cth) ("the Criminal Code"), to which further reference will be made43. A judicial officer who is president or chairman of a Royal Commission or the sole commissioner has in relation to an offence under s 6O(1) which is committed in the face of the Commission all the powers of a Justice of this Court sitting in open Court in relation to a contempt in the face of the Court (s 6O(2)). It follows from the reasoning in Butterworth44 that victimisation of witnesses of the nature identified in s 6M might also amount to an intentional contempt attracting the operation of s 6O. As Butterworth also indicates, there may be a measure of duality, if not overlapping, of legal norms in this area. What is significant, however, is the reference in s 6O to contempts which are intentional; this should be read conformably with the phrase "for or on account of" in s 6M. A person has intention with respect to conduct if he or she "means to engage in that conduct" (Criminal Code, s 5.2(1)). When this is applied to s 6O of the Royal Commissions Act, the upshot is consistent with the construction of s 6O in its earlier form by Davies J in R v O'Dea45. His Honour adopted what had been said by Isaacs and Rich JJ in Bell v Stewart46: "It is clear to our minds that the word 'wilfully' does more than negative 'accidentally' or 'unconsciously'. The Legislature was, of course, not simply excluding acts done in sleep or hypnosis or under compulsion. To speak of a person 'wilfully insulting or disturbing the Court' means that he 43 The amendment was made by Sched 1, Item 35 of the Prime Minister and Cabinet Legislation Amendment (Application of Criminal Code) Act 2001 (Cth). Item 33 removed from s 6M the reference to "procures". 44 [1963] 1 QB 696. See also as to punishment for contempt involving victimisation of witnesses James v Robinson (1963) 109 CLR 593 at 602, 615; Morris v Wellington City [1969] NZLR 1038; R v Wright (No 1) [1968] VR 164; Lowe and Sufrin, Borrie and Lowe The Law of Contempt, 3rd ed (1996) at 412-418; Miller, Contempt of Court, 3rd ed (2000), §§11.03–11.05; Eady and Smith, Arlidge, Eady and Smith on Contempt, 3rd ed (2005), §§11-197–11-215. 45 (1983) 72 FLR 436 at 447. 46 (1920) 28 CLR 419 at 427. Crennan intended to insult or disturb the Court, and not in the sense that his volition impelled the word or the act, but that his purpose was that his word or his act should have the effect of conveying the insult or causing the disturbance. And similarly with all the matters governed by the word 'wilfully'." Their Honours then went on to distinguish between "contempt" and "wilful contempt"47. In Witham v Holloway48, the retention of that distinction attracted much criticism, but s 6O assumes that distinction is maintained and it is inappropriate here to consider any further that criticism and the distinction between "criminal contempt" and the contempt in procedure described as "civil contempt". Section 1C of the Royal Commissions Act applies Ch 2 of the Criminal Code to offences including that provided in s 6M. Chapter 2 contains particular provisions for strict liability and absolute liability in cases where fault elements are not required (Ch 2, Pt 2.2, Div 6). Some offences, for example, the failure of witnesses to attend or produce documents which is proscribed by s 3(1) and (2) of the Royal Commissions Act, are identified by the section creating the offence as an offence of "strict liability". Section 6M (like s 6O) is not such a provision. Divisions 4 and 5 dealing with the fault elements or particular physical elements of the offence thus are applicable. A physical element may be conduct or the result of conduct, and the conduct must be voluntary (s 4.1, s 4.2); the fault element for a particular physical element may be intention, knowledge, recklessness or negligence (s 5.1). Section 5.1(2) provides that sub-s (1) does not prevent a law that creates a particular offence from specifying other fault elements (that is, other than intention, knowledge, recklessness or negligence) for a physical element of that offence. The respondents correctly submit that in the alleged contravention by them of s 6M there are two "physical elements": first, the sending on 18 February 2005 to X and Y of the "show cause" letters and, secondly, the result of that conduct in causing disadvantage to X and Y. Further, the "fault element" for those requisite "physical elements" is supplied by the phrase "for or on account of". 47 (1920) 28 CLR 419 at 427-429. 48 (1995) 183 CLR 525. Crennan Assistance in construing those words in s 6M is provided by what was said in this Court in a contempt case, Lane v Registrar of Supreme Court of NSW49. That case concerned alleged contempt of the Supreme Court by reason of a failure to produce documents in answer to a subpoena after legal advice that the documents were outside the scope of the subpoena. This Court held that there had been no contempt. In the joint judgment of Gibbs CJ, Mason, Murphy, Wilson and Brennan JJ, reference was made to Butterworth and to the earlier decision in Rowden v Universities Co-operative Association Ltd50. Their "In those cases, the purpose, intention or motive of the act was to do the very thing that would interfere with the course of justice – to keep the witness out of the way or to victimize the witness. The words 'purpose', 'motive', 'object' and 'intention' are used interchangeably in the judgments in Attorney-General v Butterworth and it is quite unnecessary for present purposes to distinguish between them; we shall use the word 'intention' to cover motive as well." Their Honours then observed that an intention to interfere with the administration of justice was not necessary to constitute a contempt, the critical question being whether the act was likely to have that effect; nevertheless, the intention with which the act was done was said to be relevant and sometimes important. That certainly must be so where, as here, the court is concerned with specific criminal offences created by statute in the terms of s 6M and s 6O and with fault elements indicated by the Criminal Code. What is of critical importance for the present case is the further statement in the joint judgment in Lane52: "A lawful act may constitute a contempt if done with the intention of interfering with the course of justice, but will not become a contempt 49 (1981) 148 CLR 245. 50 (1881) 71 LT Jo 373. 51 (1981) 148 CLR 245 at 258. 52 (1981) 148 CLR 245 at 258-259. Crennan simply because it was done to achieve some purpose or further some interest of the person doing it. For one person to advise another who has been served with a subpoena to refrain from producing a document which the person giving the advice rightly believes falls outside the description of documents contained in the subpoena and therefore need not be produced does not become a contempt because the person giving the advice wishes to achieve some lawful purpose of his own by ensuring that the documents are not produced." (emphasis added) An example of the distinction so drawn in Lane is provided by the decision of Eichelbaum CJ in Dentice v Valuers Registration Board53. The applicants were valuers who had prepared reports for use in an arbitration. In a subsequent proceeding before a statutory body, the Valuers Registration Board, they were charged with incompetent conduct. The applicants complained in the High Court that the disciplinary proceedings were an attempt to punish them for the evidence given by them at the arbitration and the disciplinary proceedings should be quashed as constituting a contempt of court. Eichelbaum CJ concluded54: "Any censure imposed by the board would be for providing evidence that fell below the minimum acceptable standards imposed by the profession and not for the mere fact of giving evidence itself. that is no evidence ... There the complaint was motivated by dissatisfaction over the arbitrator's award, but even if it had been, that would not suffice to pre-empt the statutory investigation which the board must carry out when the complaint procedure has reached this stage, except where satisfied there is no reasonable ground for the complaint." Conclusions Section 6P of the Royal Commissions Act, dealing with the communication of information, postulates the concurrent operation of that statute with the administration by authorities such as APRA of statutes including the Insurance Act. In the present case, on the material on which the question for separate decision was presented to the primary judge, there is no ground to reach 53 [1992] 1 NZLR 720. 54 [1992] 1 NZLR 720 at 727. Crennan any conclusion other than that Mr Godfrey was proceeding in discharge of the statutory powers of a regulatory nature conferred upon APRA by the Insurance Act. Nor was there any footing for a conclusion that a continuation by APRA of that process would be other than for the proper discharge of its statutory functions. The expression in s 6M "for or on account of" involves notions of purpose, motive, object and intention identified in Lane with reference to what had been said in the judgments in Butterworth. It is, as it was in Lane, unnecessary to make any particular choice between these terms. The point is that none of them applies to identify what has happened in this case and what is proposed if the investigations by APRA continue. Once it is accepted, as it must be, that what Mr Godfrey has done, and what APRA proposes to do, are for the proper discharge of APRA's statutory powers and functions, it is then apparent that there is not the connection between the attendance of X and Y at the Commission, or the evidence they gave, with the past or threatened conduct of Mr Godfrey and APRA, that is captured by the expression "for or on account of". The evidence that X and Y gave at the HIH Royal Commission may provide some, or even all, of the material which APRA may consider, and upon which it may rely, in giving effect to the regulatory provisions of the Insurance Act. Any disadvantage suffered by X or Y, as a consequence of the proper application of those regulatory provisions, would not be "for or on account of" his attendance at the Royal Commission or the evidence he gave. Neither Mr Godfrey nor APRA has victimised, and neither proposes to victimise, the appellants in the sense required for the commission of an offence under s 6M of the Royal Commissions Act. These conclusions do not depend upon any specific significance lent by s 6DD to the construction of s 6M. The inadmissibility of statements or disclosures made in answer to questions put in the course of a Royal Commission in certain subsequent curial civil or criminal proceedings does not bear upon the deliberations of APRA when exercising its powers of disqualification under the Insurance Act. The provision made by s 6DD, like the protection afforded witnesses by s 6M, the intentional contempt provision of s 6O and the communication provision of s 6P, may be seen as assisting the effective operation of Royal Commissions. But s 6DD has no immediate bearing upon this appeal. This should be reflected in the order to be made in this Court. As Lindgren J pointed out in his reasons for judgment, in the proceedings before him the appellants abandoned an argument that there had been a contravention of s 6DD. That Crennan earlier argument was taken up in the form of the question as originally framed by Lindgren J. The question should be answered in a way that reflects the appellants' case as it was finally put. Orders Order 2(b) made by the primary judge should be amended so that the answer to the question there stated reads: "The answer to the question is governed by the construction of s 6M alone, and so understood is 'No'." The appeal otherwise should be dismissed with costs. Kirby KIRBY J. This is an appeal55 against orders made by the Full Court of the Federal Court of Australia56. That Court dismissed appeals brought against earlier orders made by a single judge of the Court (Lindgren J)57. In disposing of the proceedings before him, Lindgren J separated two questions for prior determination and proceeded to answer those questions, as later amended, for the purpose of the continuation of the proceedings. Relevantly, the second question and answer were as follows58: "2B Does the use by the first or second respondent of the evidence of the first applicant before the Royal Commission contravene ss 6DD or 6M of the Royal Commissions Act 1902 (Cth)? Answer: No." In their reasons, Gleeson CJ, Gummow, Hayne, Callinan, Heydon and Crennan JJ ("the joint reasons") have concluded that the answer to that question should be qualified, such that "[t]he answer to the question is governed by the construction of s 6M alone, and, so understood is 'no'"59. This proposed amendment follows from their Honours' view that the answer to the problem of statutory construction presented by the appeal is to be found sufficiently within the words "for or on account of", which appear in s 6M of the Royal Commissions Act 1902 (Cth) ("the Royal Commissions Act")60. 55 Two applications for special leave were made to this Court: one by the first and second appellants (X and Z) and the other by the third and second appellants (Y and Z). The grant of special leave in each case was limited to identical grounds. The separate applications were reduced to one appeal in accordance with an order made on the grant of special leave. Subsequently, one notice of appeal was filed by the appellants. See the reasons of Gleeson CJ, Gummow, Hayne, Callinan, Heydon and Crennan JJ ("the joint reasons") at [20]-[21]. 56 Y v Australian Prudential Regulation Authority (2006) 150 FCR 469. 57 (2006) 150 FCR 469 at 493 [80]. The reasons of Lindgren J may be found in Applicant X v Australian Prudential Regulation Authority (2006) 14 ANZ Ins Cas 58 See (2006) 14 ANZ Ins Cas ¶61-667 at 75,015 [7], 75,032 [100]. 59 Joint reasons at [62]. 60 Joint reasons at [59]. Kirby In my opinion, the primary judge and the Full Court were correct to seek an answer to the question presented by this case in something more than a verbal formula that compresses the puzzle into the statutory phrase to which the joint reasons give their emphasis. That phrase does, indeed, ultimately yield the answer to the puzzle. However, in finding that answer, and giving guidance for future cases, it was useful for the Federal Court to seek to identify, and explain, the meaning and purpose of s 6M of the Royal Commissions Act, read in its context. That context included, importantly, s 6DD of the Act. Moreover, the Federal Court correctly endeavoured to identify the line of demarcation between the permissible and impermissible use, in a subsequent action, of evidence given before a Royal Commission, where the use of that evidence causes damage, loss or disadvantage to the person who gave such evidence. In short, I agree with the general analysis contained in the reasons of the primary judge and of the Full Court. I would therefore simply dismiss the appeal from that Court. Some of my reasons for doing so are similar to those stated in the joint reasons. However, in case the qualification to the orders proposed in those reasons might be read as suggesting that s 6DD of the Royal Commissions Act is irrelevant to the task of construction, I must state my reasons separately. The facts, legislation and litigation The facts: The background facts in this appeal are explained in the joint reasons61. The evidence which the first appellant (known by the initial "X") and the third appellant (known by the initial "Y"), officers of a foreign corporation incorporated in Germany (known by the initial "Z"), object to being used by the Australian Prudential Regulation Authority ("APRA") was adduced before a federal Royal Commission ("the HIH Royal Commission") established to inquire into the failure of the HIH Insurance Group ("HIH"). It was formerly a major Australian insurer. As the report of the HIH Royal Commission discloses, the failure of HIH caused huge losses to the investing public in Australia and beyond; substantial losses to those who had been insured by HIH, or who were entitled to the benefits of such insurance; widespread suffering and anxiety for many such persons; and damage to Australian business confidence generally, and to confidence in the insurance industry specifically. The establishment of a federal Royal Commission is not a trifling thing in Australia. A Royal Commission is a major investigatory mechanism that enjoys exceptional powers designed to achieve, outside the ordinary machinery of law enforcement and industry regulation, an inquiry that will reveal facts and permit executive governments to 61 Joint reasons at [1]-[8]. Kirby take administrative, criminal and other measures to sanction any demonstrated wrongdoing and to prevent its repetition. The interpretation by this Court of the Royal Commissions Act should be undertaken so as to achieve, and not to frustrate, the provision by the Parliament of such exceptional powers62. The legislation: The issue for decision in this appeal is, primarily, the meaning of s 6M of the Royal Commissions Act. As the joint reasons point out, that Act, in its original form, was one of the first enactments of the Australian Federal Parliament. Its terms were greatly influenced by the legislation enacted in the latter part of the nineteenth century by the Imperial Parliament in the United Kingdom63. The provenance of the Australian provisions is made clear by an examination of the language of the Witnesses (Public Inquiries) Protection Act 1892 (UK)64. In the manner of Imperial legislative drafting of that time (familiar to Australians whenever they look at the sparse language of their Constitution, prepared for submission to the same Parliament) the language of the legislation was expressed with high compression. Packed into a single section were many words and concepts which today, in the style of contemporary drafting, would be divided up so as to deal separately with different ideas and to avoid the confusion and ambiguity that may attend such a compressed use of the English language. The provisions of s 2 of the 1892 Act are set out in the joint reasons65. It is sufficient to notice that, in the text of that single section is contained a series of "acts" which are rendered misdemeanours against the public inquiry provided for. These are punishable, upon conviction, in accordance with specified penalties. The acts of the accused that attract the provision include where the accused "threatens, or in any way punishes, damnifies, or injures, or attempts to punish, damnify, or injure, any person". The causes that enliven the section are the acts of any person (the accused) towards another person "for having given 62 This is especially so in the case of the HIH Royal Commission because the Royal Commissions and Other Legislation Amendment Act 2001 (Cth) enlarged the powers of the Commission under the Royal Commissions Act. See Explanatory Memorandum issued by the Prime Minister on the Royal Commissions and Other Legislation Amendment Bill 2001 (Cth). 63 See joint reasons at [36]-[48], referring to the Witnesses (Public Inquiries) Protection Act 1892 (UK), Trades Union Commission Act 1867 (UK), Belfast Commission Act 1886 (UK), Metropolitan Board (Commission) Act 1888 (UK) and Special Commission Act 1888 (UK). 64 55 & 56 Vict c 64. See joint reasons at [36]-[42]. 65 Joint reasons at [37]-[39]. Kirby evidence upon any inquiry, or on account of the evidence which he has given upon any such inquiry". The section is then still further complicated by an exemption where "such evidence was given", by inference by the subject of the section, "in bad faith". So within five lines of the statute book, three ideas were put into play. First, the forbidden conduct of the actor (accused); secondly, the conduct of the subject (witness) before the public inquiry; and thirdly, the exemption for evidence given in bad faith. There is a like compression in the language of s 6M, in issue here. We must be grateful for small mercies because the Australian drafter has at least removed the third idea (evidence given in bad faith) and split up the presentation of the second. However, the collection of forbidden acts for forbidden purposes remains very tightly packed66. Section 6M states67: "Injury to witness Any person who uses, causes or inflicts, any violence, punishment, damage, loss, or disadvantage to any person for or on account of: the person having appeared as a witness before any Royal Commission; or any evidence given by him or her before any Royal Commission; or the person having produced a document or thing pursuant to a summons, requirement or notice under section 2; is guilty of an indictable offence. Penalty: $1,000, or imprisonment for 1 year." Immediately, the ambiguity that is inherent in this mode of drafting (a "minimalist" style of legal expression) is apparent. Is the collection of verbs intended to refer, in sequence, to the collection of nouns that follows? Thus, does the verb "uses" relate solely to the noun "violence"; "causes" to the noun "punishment"; "inflicts" to the nouns "damage, loss, or disadvantage"? 66 Sir Robert Garran commented critically on this style of legislative drafting. See Garran, Prosper the Commonwealth, (1958) at 145-147. 67 Some of the relevant provisions of the Royal Commissions Act have since been amended by the Royal Commissions Amendment Act 2006 (Cth). Section 6M was unaffected by these amendments. Kirby There is some internal support for this sequential approach to s 6M. Thus, "uses" scarcely relates comfortably to "punishment" or the subsequent nouns in the collection. On the other hand, "causes" could quite readily refer to "violence" and any of the other nouns used in the section. As well, "inflicts" could apply to "violence" and indeed to any of the nouns that follow. This analysis suggests that a sequential assignment of each verb to the successive nouns in the opening words of s 6M is not the way the section was intended to work. Once this conclusion is reached, the problem of ambiguity raised by the appellants' arguments is presented in stark relief. If the verb "causes" can relate to the noun "disadvantage", the ambit of conduct forbidden by s 6M is potentially very large. Does the section then forbid the conduct of "[a]ny person who … causes ... disadvantage to any [other] person for or on account of … any evidence given by him or her before any Royal Commission"? The phrase "for or on account of" can be defined to circumvent such a broad operation of the section. But how is that phrase to be given a meaning that permits the express use of evidence given by a person before any Royal Commission in a way that potentially "causes … disadvantage" to that person yet does not involve an offence against the Royal Commissions Act in the terms in which s 6M expresses that offence? The words "for or on account of" in s 6M, without more, define the answer. However, they do not explain when and why the answer applies. Hence, the grant of special leave to the appellants on this point in their appeal. The litigation: The course of the proceedings that now bring a limited issue to this Court is described in the joint reasons68. I will not repeat any of this material. The appellants had wished to challenge both of the answers given in the Federal Court in respect of the questions isolated for separate decision by the primary judge. However, special leave to appeal was refused on the answer to the first question which concerned the suggested lack of power of APRA to proceed as it contemplated in relation to the individual appellants69. The answer given by the primary judge on this issue, confirmed by the Full Court, is not, therefore, before this Court. Our only concern is with the answer to the second separated question. This relates to the use made, and intended to be made, by APRA and its senior manager, Mr Godfrey, of the evidence given by X and Y before the HIH Royal Commission. There can be no doubt that, unless this Court forbids it by reversing the answer given by the primary judge to the second question, it is the intention of Mr Godfrey to use the evidence given by X and Y before the Royal Commission in support of a presently proposed recommendation that APRA should disqualify 68 Joint reasons at [9]-[19]. 69 Joint reasons at [12]. Kirby X and Y under the Insurance Act 1973 (Cth) ("the Insurance Act"). That this is so is made plain in the correspondence addressed to X and Y upon which they each relied to establish that APRA and Mr Godfrey planned to cause disadvantage to them, relevantly, for or on account of evidence given by them before the HIH Royal Commission, reading that phrase in a broad causative sense. The indicated use of the evidence: The essential foundation, relied on in this respect by X and Y, was correspondence addressed to each of them by which Mr Godfrey gave them notice that he had come to a "preliminary view" that each "should be disqualified from being or acting as the holder of a senior insurance role, pursuant to [s] 25A(1) of the Insurance Act". The letter of notification stated that this "preliminary view" had been reached by Mr Godfrey "[o]n the basis of the information referred to in this letter". That information, and the preliminary finding relating to it, were included in an attachment to the letter of notification by which Mr Godfrey afforded X and Y the opportunity to make submissions as to why APRA should not make a decision to disqualify them under s 25A(1) of the Insurance Act as tentatively proposed by him. It is enough to say that, in the attachment to the letter, there are repeated and express statements referring to, and quoting from, the evidence given by each of X and Y to the HIH Royal Commission. Thus, in par 5 of the attachment relating to X, Mr Godfrey states that "[e]vidence provided to the HIH Royal Commission ... demonstrates the following:". There follow 41 subparagraphs, each one cross-referenced to the transcript of the HIH Royal Commission and to evidence recorded there on identified days before the Commission. Many of the subparagraphs that follow begin with words to the effect, "In your oral evidence to the HIH Royal Commission". The subparagraphs referring to the oral evidence of the individual appellants sometimes summarise, and on other occasions, directly quote, what that appellant "told the Royal Commission" as to his understanding of the relationship between HIH and Z on issues of reinsurance. The document is full of statements such as "You gave oral evidence that ..."; "You told the Royal Commission that …"; "You also stated ..."; "In oral evidence to the Royal Commission you admitted that you were aware …"; "In oral evidence you admitted that when you drafted the treaty wordings, you were aware …"; and "In cross-examination during the Royal Commission, you denied …". It is essentially on the basis of these documents, therefore, that X and Y contend that APRA and Mr Godfrey will, unless restrained, "cause disadvantage" to each of them, by way of proceeding to give effect to the "preliminary view" (as they submit) "for or on account of … evidence given by [each of them] before [the] Royal Commission". Kirby In this sense, X and Y did not contest before this Court the right of APRA and Mr Godfrey to proceed to consider any action that they might take pursuant to the Insurance Act based on: The evidence of persons other than X and Y given before the Royal Commission; The evidence uncovered by the Royal Commission or others in consequence of the inquiries of the Royal Commission; or (3) Any opinion of the Royal Commission reached separately and independently of the evidence of X and Y. What they objected to, relevantly, was the causing of the threatened disadvantage to them "for or on account of" their own evidence, as signalled in Mr Godfrey's letters which initiated their challenges. Three preliminary questions Anonymity of the parties: Before addressing the parties' arguments on the central issue in the appeal, I wish to say something about three preliminary questions, two of which are mentioned in the joint reasons70. First, as already noted, the names of the individual appellants (X and Y), and the German corporation of which they are officers (Z), were anonymised by order of the primary judge in the Federal Court. His Honour's order was made on 13 May 2005 and stated to be pursuant to the Federal Court of Australia Act 1976 (Cth)71. The truly exceptional circumstances under which such an order can be made may be understood when attention is addressed to the grounds for which the Parliament has expressly provided for the suppression or restriction of the publication of particular evidence or the name of a party or of a witness appearing in the Federal Court. The grounds stated in s 50 of that Act are limited to circumstances where such an order is "necessary in order to prevent prejudice to the administration of justice or the security of the Commonwealth"72. As the 70 Joint reasons at [2], [6]-[8], [19]-[21], [60]-[61]. 71 s 50. Within the Federal Court, the application of that section was considered in Australian Broadcasting Commission v Parish (1980) 29 ALR 228 at 232-234. That authority was not examined in these proceedings. 72 The issue of suppression was the subject of a separate decision of the Full Court in this case. See Applicant Y v Australian Prudential Regulation Authority [2005] FCAFC 222. For that decision the Full Court was constituted by Emmett, Allsop Kirby Federal Court explained in Australian Broadcasting Commission v Parish73, "[o]pen justice is the underlying assumption of s 50". The suppression of names ought to be confined to cases in which disclosure "would prejudice the court's proper exercise of the function it was appointed to discharge, to do justice between the parties", or where disclosure "would destroy the subject-matter of the proceedings and render them nugatory"74. A case in which the use of names would seriously impede or discourage access to the courts might be another instance in which anonymity would be justified according to the statutory formula. The present certainly does not appear to have been such a case. I realise that the identification of the names of X and Y and of the corporation, Z, with which they are associated, might be embarrassing to all of them. I accept that, in contemporary times, with the ready availability of the internet, the disclosure of their identities and of the proceedings designed to prevent APRA and Mr Godfrey the administrative steps from foreshadowed, might do some harm to individual and corporate reputations. taking Perhaps Australian judicial process should provide more ample protection to witnesses from the revelation of their names in situations where they have simply invoked, or become involved in, proceedings in the courts. For particular, but limited, purposes, specific legislation, federal75 and State76, has been enacted requiring the suppression of the identity of a witness or party. Additionally, out of their implied or "inherent" powers, Australian courts sometimes anonymise proceedings to protect from needless harm the identity of persons who become involved in court process. However, every day, in our courts, parties and witnesses must disclose their names and identities, although this is doubtless often uncongenial and even 73 (1980) 29 ALR 228 at 234. 74 Australian Broadcasting Commission v Parish (1980) 29 ALR 228 at 233. See also John Fairfax & Sons Ltd v Police Tribunal of NSW (1986) 5 NSWLR 465 at 476-477; John Fairfax Group Pty Ltd v Local Court (NSW) (1991) 26 NSWLR 131 at 141; Gianni Versace SpA v Monte (2002) 119 FCR 349. 75 See eg Migration Act 1958 (Cth), s 91X (suppression of names of refugee applicants by the High Court, Federal Court and Federal Magistrates Court). 76 See eg Juvenile Justice Act 1992 (Q), s 288; Child Protection Act 1999 (Q), s 193; Criminal Law (Sexual Offences) Act 1978 (Q), ss 6, 10(3) (suppression of the names of juveniles and certain victims of sexual abuse). See Phillips v The Queen (2006) 80 ALJR 537 at 553 [81]-[87]; 224 ALR 216 at 236-237. Kirby damaging. It is part of the strong tradition of open justice that characterises the courts of this country77. When, on the return of these proceedings, I sought an explanation for the anonymity order made in this case, the only reason advanced was that the primary judge had made such an order and that, by consent, the order had been continued thereafter, including in this Court. Congenial arrangements of this kind should, in my view, take into close account the basic principle of the open administration of justice in the courts. The proliferation of instances where courts suppress the identity of parties and witnesses (without specific legislative warrant) is undesirable. The naming of X, Y and Z did not prejudice the security of the Commonwealth. Nor is it apparent to me why it was necessary to suppress their names "to prevent prejudice to the administration of justice". It may cause some prejudice to the parties, perhaps, but ordinarily the administration of justice is strengthened by openness and full disclosure. In any case, there is an air of unreality in the suppression of the names of X, Y and Z in these proceedings78. Their names were not suppressed during the HIH Royal Commission. They appear in the records of that Commission, including those to which Mr Godfrey made explicit reference in his letters foreshadowing administrative steps under the Insurance Act. No one before this Court wanted to engage in this debate. However, it is up to the courts themselves to defend the general principle of openness and transparency of proceedings. Judicial suppression creates suspicion and sometimes concern. It should ordinarily be kept to a strict minimum. The appellants had arguable legal points by which to defend their rights. They should normally be expected to wear the burden of any publicity that attaches to that endeavour. Separated questions: This is yet another case where a great deal of interlocutory litigation has unfolded as a result of the separation of questions, answered in the course of substantive proceedings without finally resolving those proceedings. It is not entirely clear, in the present instance, how the primary judge came to separate the two questions, as he did on 13 May 2005. It is recorded that they 77 Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 47 at 53, 58-59, referring to Russell v Russell (1976) 134 CLR 495 at 520; Harman v Secretary of State for the Home Department [1983] 1 AC 280 at 316. 78 cf A v Hayden (1984) 156 CLR 532 at 550 per Mason J. Kirby were separated "by consent"79. In earlier years, I was sympathetic to this procedure in the hope that it sometimes holds out that preliminary determinations of legal questions will resolve fundamental issues and, perhaps, save a great deal of court time in the process80. This may still be true in some cases. I do not deny the occasional utility of the procedure. However, the longer I observe litigation over separated questions, the more I am reinforced in the conclusion that the practice is commonly, or at least often, misguided, counter-productive and, ultimately, unduly expensive and burdensome to the courts and the parties alike81. It often seems to grow out of an inclination of parties and their advisers to postpone facing up to the irksome necessities of the trial. There was an added reason, in the present case, why great care was needed before separating questions, however fundamental they might have seemed to the further prosecution of the proceedings. This was that the provisions of s 6M of the Royal Commissions Act are penal. If breached, they render a person potentially guilty of an indictable offence. Such an offence, by s 80 of the Constitution, carries an entitlement to trial by jury. This Court has said repeatedly that great care must be exercised before interlocutory challenges are permitted in such matters82. True it is that the proceedings brought by the appellants were civil in nature. They invoked s 39B of the Judiciary Act 1903 (Cth) to enliven the original jurisdiction of the Federal Court because they sought an injunction against Mr Godfrey, an officer of the Commonwealth83. However, the hypothesis at the heart of the appellants' contention on the second question separated by the primary judge was that Mr Godfrey was a person threatening to commit an indictable federal offence contrary to s 6M of the Royal Commissions Act. In the stated constitutional setting, special care was needed before separating that question and proceeding to make interlocutory findings and orders in relation to it. The subsequent chronicle of interlocutory appeals in these proceedings demonstrates, once again, the disadvantage of embarking on that course. 79 (2006) 14 ANZ Ins Cas ¶61-667 at 75,015 [7]. 80 See eg R v Elliott (1996) 185 CLR 250 at 257. 81 See eg American Home Assurance Co v Ampol Refineries Ltd (1987) 10 NSWLR 13 at 18-19; Rajski v Carson (1988) 15 NSWLR 84 at 88. 82 So too have other Australian courts. See eg Dorney v Commissioner of Taxation [1980] 1 NSWLR 404 at 417 per Mahoney JA (dissenting); Sivakumar v Pattison [1984] 2 NSWLR 78 at 83. 83 Joint reasons at [10]. Kirby As no party challenged the course taken (and indeed all were complicit in it) I can do no more than to suggest, with respect, that it was an unwise course of action. Despite doubtless good intentions, it involved the parties and the community in expense and delay in hearings and appeals that the normal process of proceedings in the courts tends to reduce and confine. Anticipatory orders and declarations: There is a third point. It concerns the possible special imprudence of embarking on these proceedings, given that what was involved was an attempt by the appellants to gain a declaration and an injunctive order in relation to the operation of s 6M of the Royal Commissions Act, a penal provision, designated as indictable and carrying significant consequences for those convicted of a breach. An immediate question is presented as to whether a court, asked in advance of the commission of any such offence, would, as a matter of discretion, grant a remedy by way of injunction, in effect, to restrain what would otherwise be a breach of penal provisions of the Royal Commissions Act. Would a court do so by acting on an hypothesis (as invited by the parties) which might, or might not, be fulfilled by subsequent events? Would the provision of an injunction in such circumstances, and more particularly the answer to separated questions or the provision of a judicial declaration, amount, effectively, to the provision of advice on the operation of penal provisions in federal legislation? Could it be said that the letters addressed by Mr Godfrey to X and Y already evidenced a breach of the Royal Commissions Act, if the appellants' argument about the meaning of s 6M of that Act were correct? Even those who, like myself, are more sympathetic to the facultative use of judicial declarations84, hesitate where what is claimed is, in effect, an anticipatory declaration on whether specified conduct could involve an indictable federal offence. The strong tradition of requiring precise proof of such offences and the constitutional provision in Australia reserving judgment on that proof to the verdict of a jury, constitute particular reasons why, in this case, there were special grounds for caution before embarking on the course of proceedings that unfolded. For example, it might have been possible, had the proceedings concluded before the primary judge, without interlocutory interruption, for him to have decided them by wholly ignoring the evidence of X and Y before the HIH Royal Commission. The primary judge may have sustained the course proposed by Mr Godfrey, based on other evidence unaffected by any evidence given by X or 84 See eg Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 371 [89]; contrast Kirby Y before the Royal Commission. The lesson of much litigation is that theoretical problems, of the kind which tend to be isolated for preliminary determination, and disjoined from a trial, disappear, or are avoided, in the way the trial typically proceeds to its conclusion. I therefore agree with the joint reasons that there was a real question as to the procedure adopted in this case. However, I also agree that, no objection to that procedure having been raised in this Court, it is fruitless for us now to do more than to call attention to the imperfections in the procedure, but nonetheless to decide the appeal within the four corners in which it was argued. The case for the appellants A textual argument: If the appellants did not have an arguable construction of s 6M of the Royal Commissions Act, including as that section is read with s 6DD (referred to in the primary judge's second separated question), they probably would not have proceeded so far in the Australian judiciary. Thus, although their appeals were heard against interlocutory orders of the primary judge, they secured leave to appeal against his Honour's determinations to the Full Court85. Moreover, the appellants later obtained special leave to appeal to this Court. The appellants' argument of error on the part of the Federal Court involved an appeal to a strict construction of s 6M of the Royal Commissions Act. Thus, they submitted that Mr Godfrey was a person intending to cause each of them disadvantage in the form of the administrative action that he was threatening, namely, the making of a recommendation to APRA that each of X and Y be disqualified from being a holder of a senior insurance role pursuant to s 25A(1) of the Insurance Act. In the global character that is now a feature of the insurance industry, it takes little imagination to infer that, although neither X nor Y is resident, employed or performing insurance functions in Australia, such a disqualification, if made by the Australian authority, would, at the least, cause disadvantage to persons such as X and Y. By inference, in an industry which depends heavily upon the reputation of insurance corporations and their officers for good faith, integrity and fair dealing, such a statutory finding and order, within a significant insurance market such as Australia, would need to be disclosed by X, Y and Z in various circumstances where disclosure was expressly required or impliedly expected. The threatened action, at least if carried out, would not involve the use of "violence" or the infliction of "punishment" in the strict sense. But it would 85 Leave was granted by the Full Court on 23 September 2005, a week after the orders of the primary judge. Kirby inferentially, at the least, cause "disadvantage" to a person so disqualified and thus engage the opening words of s 6M. Moreover, the repeated reference, contained in Mr Godfrey's letters to X and Y, to the evidence given by each of them before the Royal Commission, would seem to engage par (b) of s 6M, so long as the necessary link, envisaged by that section, is established. That link appears in the phrase "for or on account of". It must be "for or on account of ... any evidence" of that kind, that the disadvantage86 is caused by Mr Godfrey to X or Y or either one of them. In their submissions to this Court, the appellants argued that the reading in the Federal Court of the phrase "for or on account of" was overly constricted and inconsistent with the actual terms of the Royal Commissions Act. The appellants contested the distinction drawn in the Federal Court between action taken based on evidence before a Royal Commission itself, and action taken based on the facts that pre-existed the Royal Commission, but which were disclosed by that evidence. Not only did that distinction lack an explicit textual foundation. According to the appellants, it overlooked the particular force and forensic utility of admissions and confessions made in the course of evidence before a Royal Commission. The statutory embargo on the use of evidence given before the Royal Commission was emphatic. The appellants submitted that the linking phrase "for or on account of" meant nothing more than "caused by". They argued that this Court should give the phrase its ordinary natural meaning. The preposition "for" was related to (and apt for) the offence (in s 6M(a)), occasioned to a person for having appeared as a witness at all. It was also related to (and apt for) the offence in s 6M(c), occasioned to a person for having produced a document or thing under s 2 of the Act. The words "on account of" were more apt to the language of s 6M(b) which did not refer to an event, as such, but to the content of evidence given before the Royal Commission. If "on account of" the content of such evidence, a disadvantage were caused to the person who gave the evidence, that would be a breach of the section. No more was required. The offence was complete. A contextual argument: The appellants also relied on matters of context in the Royal Commissions Act to support their interpretation. Thus, the differentiation between the offence, relevantly, of causing disadvantage to a person "for or on account of" having appeared as a witness and "for or on account of … any evidence given" was significant for the appellants because it made it plain that the Royal Commissions Act was protecting, in the latter phrase, the actual content of evidence given before a Royal Commission and not simply the fact that evidence was given (or a document produced). According to the appellants, the differentiation between the paragraphs of s 6M lent emphasis 86 cf Rich v Australian Securities and Investments Commission (2004) 220 CLR 129 Kirby to the special status of the content of their evidence. That emphasis was designed to protect them from having disadvantage caused to them, by reason of that content, that is, "for or on account of" it. Because it would be an indictable offence to use the evidence as such, by necessary implication it was unavailable for such use. Its use was forbidden by the Act. Another contextual argument pressed by the appellants involved a reference to s 6N of the Royal Commissions Act, enacted at the same time as s 6M was introduced87. That section provides specific penalties for employers who prejudice employees in the context of Royal Commissions: "Dismissal by employers of witness (1) Any employer who dismisses any employee from his or her employment, or prejudices any employee in his or her employment, for or on account of the employee having: appeared as a witness before a Royal Commission; or given evidence before a Royal Commission; or produced a document or summons, requirement or notice under section 2; thing pursuant to a is guilty of an indictable offence. Penalty: (emphasis added) imprisonment for 1 year." There is a close similarity between the language of s 6M and of s 6N(1). However, there is also an important difference. Paragraph (b) in s 6N(1) refers only to the fact of having given evidence. It does not refer to the content of the evidence, as par (b) in s 6M does. The appellants submitted that the juxtaposition of the language of the two paragraphs lent emphasis to the breadth of the deliberate protection for the content of the evidence of a witness before a Royal Commission under s 6M. Thus, it was not, as such, the fact of giving evidence (probably encompassed by par (a)) that was protected. It was the actual evidence given that engaged the protection of s 6M(b). The appellants argued that the judges of the Federal Court had failed to give proper attention to this distinct expression in s 6M(b). They asked this Court to do so. A policy argument: Ultimately, the appellants embraced the suggestion that the distinction for which they argued was supported by a policy that lay 87 By the Royal Commissions Act 1912 (Cth). See also joint reasons at [31]-[35]. Kirby behind the protection of evidence given before a Royal Commission. According to this argument, Royal Commissions, although designed for the important object of arriving at the truth about conflicting factual matters (and deciding the better view of conflicting issues of opinion, social policy and future legislation), enlist onerous procedures for the ultimate purpose of serving the public interest. The coercive powers afforded to Royal Commissions include the power to summon witnesses and to take evidence on oath or affirmation88; to require witnesses to attend and produce documents89; to permit the issue of extensive search warrants90; and to punish persons who refuse to be sworn, make an affirmation or answer questions91. The appellants therefore suggested that the protection afforded by s 6M(b) of the Royal Commissions Act was in the nature of a "trade- off". It amounted, in effect, to a counter-balancing protection to a person obliged to give evidence in respect of any later use that might be made of that evidence and which might cause that person disadvantage. In this way, to enhance the achievement of the objects of a Royal Commission and to further the public interest, individuals caught up in the coercive requirements of such a Commission, in respect of the evidence they gave, would be protected and thus encouraged to speak fully and openly without fear of damage, loss or disadvantage as an immediate consequence. They might be caused damage by other evidence revealed in the course of the Royal Commission. They might be caused damage by the evidence of other persons. They might be damaged by the findings, conclusions and recommendations of the Royal Commission itself. But they would not be caused damage from their own mouths by reason of ("for or on account of") the actual evidence which they themselves gave. That evidence would be immured from causing them damage, loss or disadvantage because of the greater public good of procuring their honest testimony before the Royal Commission. An argument of approach: Finally, the appellants could point to the inherent arguability of most cases of statutory construction that reach a court such as this92. The defects and ambiguities of the language of s 6M of the Royal Commissions Act were candidly, and properly, conceded by the Solicitor- General. In such circumstances, the appellants urged this Court to avoid an 88 Royal Commissions Act, s 2. 89 Royal Commissions Act, s 3. 90 Royal Commissions Act, s 4. 91 Royal Commissions Act, s 6. 92 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 215 CLR 563 at 580 [42]. Kirby artificial construction that would impose a non-textual, restrictive meaning on the phrase "for or on account of". They submitted that the fundamental duty of the Court was to give meaning to the legislative command according to the language in which the command was expressed93. Legislative history, and references to the pre-existing common law, may not deflect a court from its duty in resolving an issue of statutory construction, which is always ultimately a text-based activity94. Where the command is stated in a legislative provision of the Federal Parliament, the Court's duty is to give effect to that provision, primarily by reference to the language of the Act. If the language yields a conclusion that is considered undesirable, the Act could be changed, as the Royal Commissions Act has often and recently been95. Section 6M is concerned with victimisation Textual arguments: Whilst the appellants' interpretation is not unarguable, it does not represent the preferable construction of s 6M of the Royal Commissions Act. Basically, that section is concerned to prevent, and where it occurs, to punish, victimisation of those who appear as witnesses, give evidence and produce documents to a Royal Commission. That is the mischief at which the section is targeted. The phrase "for or on account of", in the section, should be read accordingly. There are several indications in the language of the Royal Commissions Act that this is the correct interpretation: The heading to the section (formerly the side-note) gives an indication as to its general purpose. It suggests that the section is concerned with "Injury to witness". Although the heading is not part of the Act96 and although its provisions cannot constrain the detail contained in the full text of a section of an Act, it is not wholly immaterial when there is ambiguity 93 Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518. 94 Trust Company of Australia Ltd v Commissioner of State Revenue (2003) 77 ALJR 1019 at 1029 [68]; 197 ALR 297 at 310. 95 For example, the Royal Commissions Amendment Act 2006 (Cth) introduced ss 6AA and 6AB, which modified the operation of common law principles of legal professional privilege in relation to evidence produced to a Royal Commission. See also Royal Commissions Amendment Act 1982 (Cth); Royal Commissions and Other Legislation Amendment Act 2001 (Cth); Royal Commissions Amendment (Records) Act 2006 (Cth). 96 Acts Interpretation Act 1901 (Cth), s 13(3). Kirby in the content of the section97. The words of a section heading cannot be used to restrict the terms of the section itself, if they are clear. But where, as here, those terms lend themselves to different meanings, I agree with what Lord Reid said in Director of Public Prosecutions v Schildkamp98: "[I]t may be more realistic to accept the Act as printed as being the product of the whole legislative process, and to give due weight to everything found in the printed Act. I say more realistic because in very many cases the provision before the court was never even mentioned in debate in either House, and it may be that its wording was never closely scrutinised by any member of either House. In such a case it is not very meaningful to say that the words of the Act represent the intention of Parliament but that punctuation, cross-headings and side-notes do not. … I would not object to taking all these matters into account, provided that we realise that they cannot have equal weight with the words of the Act … A cross-heading ought to indicate the scope of the sections which follow it but there is always a possibility that the scope of one of these sections may have been widened by amendment." In this case, because the meaning of par (b) is unclear (potentially involving either protection of the specific content of evidence or merely the fact that evidence was given), it is useful to have regard to the heading of the section. In this case the heading tends to support the retaliatory view of the purpose of the section. The heading does not support throwing a cloak of protection over the entire content of the evidence given by a witness to a Royal Commission and punishing seriously any person for the later use of that evidence; Further support for treating par (b) as concerned with an offence of retaliation for "any evidence given" before a Royal Commission can be found in the several verbs used in the section concerned with "violence" and "punishment": this, and the fact that, immediately following s 6M, and enacted at the same time, is s 6N, a provision designed to protect 97 Toronto Corporation v Toronto Railway [1907] AC 315 at 324-325; Director of Public Prosecutions v Schildkamp [1971] AC 1; Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594; Director-General of the Department of Corrective Services v Mitchelson (1992) 26 NSWLR 648 at 654, 657-658. 98 [1971] AC 1 at 10. See also Maxwell on the Interpretation of Statutes, 11th ed (1962) at 48-49; Singh, Principles of Statutory Interpretation, 9th ed (2004) at Kirby witnesses from retaliation by their employers. The presence of s 6N lends force to the view that s 6M was concerned with the specific mischief of victimisation of witnesses before Royal Commissions. Had the section enjoyed the purpose of providing the large protection to the content of the evidence argued by the appellants, two things would be surprising. No such purpose or "trade-off" was suggested in any of the speeches made in the Parliament at the time the predecessors to s 6M were entered in the federal statute book99. Moreover, when one such earlier provision was enacted, the reason given to the Parliament was that "[t]he clause deals with a very serious class of offences – the interference with witnesses summoned to give evidence … with the object of preventing them from giving their evidence, and so defeating the attainment of the objects for which the inquiry has been instituted"100. This language sustains, and reinforces, the accuracy of the heading to s 6M. It helps to identify the purpose of the section; and Finally, giving par (b) of s 6M this interpretation reconciles that paragraph with the language and plain operation of pars (a) and (c) of that section. It also reconciles the operation of s 6M with s 6N. It adopts the view that the mischief to which s 6M and s 6N were severally addressed was essentially the same, although s 6N is more particular and specific. The offending acts are then treated as the same and the difference of language is treated as immaterial or unimportant in the context. Contextual arguments: These conclusions are further reinforced by reference to one further provision of the Royal Commissions Act that throws light on the meaning of s 6M. The time has long passed when this Court will construe particular words out of context and give meaning to them divorced from the relevant parts of the legal document in which the words appear. That was the former way in which statutes were construed in Australia and elsewhere. It caused many statutory provisions to miss their target101 by an excessively narrow and literal 99 See, for example, Excise Procedure Act 1907 (Cth), s 10. See Australia, Senate, Parliamentary Debates (Hansard), 24 October 1907 at 5129. 100 Australia, Senate, Parliamentary Debates (Hansard), 28 September 1905 at 2910 (Senator Keating). 101 cf Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-426 approved Bropho v Western Australia (1990) 171 CLR 1 at 20; cf Wentworth Securities Ltd v Jones [1980] AC 74 at 105; Diplock, "The Courts as Legislators", in Harvey (ed), The Lawyer and Justice, (1978) 263 at 274. Kirby interpretation of statutory language, read in isolation. This is not the way meaning is attributed to words in ordinary life. Such meaning is ordinarily derived from the text, viewed in its context. It is therefore crucial to have regard to other provisions of the legal text, as such provisions cast light on ambiguous words or phrases in a particular provision102. Here, the relevant context includes those other sections of the Royal Commissions Act that were introduced by the 1912 Act. Those amendments included the introduction of s 6N, including what is now s 6N(1)(b), to which reference has already been made. But they also included s 6DD, which is the other provision to which the primary judge specifically referred, for good reason, in his second separated question. In fact, s 6DD of the Royal Commissions Act is significant to the meaning of s 6M(b). Section 6DD provides: "Statements made by witness not admissible in evidence against the witness The following are not admissible in evidence against a natural person in any civil or criminal proceedings in any court of the Commonwealth, of a State or of a Territory: a statement or disclosure made by the person in the course of giving evidence before a Commission; the production of a document or other thing by the person pursuant to a summons, requirement or notice under section 2 or subsection 6AA(3). Subsection (1) does not apply to the admissibility of evidence in proceedings for an offence against this Act." It is true that s 6DD is addressed to the admissibility of evidence in a court. To this extent, it is not immediately relevant to the intended use of the evidence given before the Royal Commission which the appellants are contesting in this appeal. Their contest is addressed to the use of the evidence of X and Y not in a court but in an administrative decision made ultimately by APRA on the basis of a recommendation made to it by its officer, Mr Godfrey. 102 Metropolitan Gas Co v Federated Gas Employees' Industrial Union (1925) 35 CLR 449 at 455; Scott v Federal Commissioner of Taxation (1966) 117 CLR 514 at 524; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 at 396-397, applying R v Brown [1996] AC 543 at 561 per Lord Hoffmann. Kirby Nevertheless, s 6DD, enacted by the 1912 Act at the same time as s 6M, is highly relevant to the meaning to be given to s 6M(b). If, as the appellants submitted, s 6M(b) threw a cloak of unuseability over "any evidence given by [X and Y] before [the] Royal Commission", s 6DD of the Royal Commissions Act would be substantially redundant. There would be no need for the more specific and finely tuned provisions of s 6DD(1)(a). Any such "statement or disclosure made by the person in the course of giving evidence" would amount to "evidence given by him or her before any Royal Commission". On the appellants' proposed meaning, to the extent that such evidence caused disadvantage (and was objected to), it was already inadmissible because the proffering of it would constitute the commission of an indictable offence. It either would not be proffered or, if proffered, would be rejected by a court as inadmissible. If s 6M is taken to be limited to punishing retaliation or victimisation against a person for giving evidence before a Royal Commission, that leaves substantive work for s 6DD to perform. Such a construction is necessary to avoid a legislative redundancy. It is consistent with the longstanding principle that all statutory provisions are prima facie significant and taken to have a field of operation103. Indeed, it is "improbable that the framers of [the Royal Commissions Act] could have intended to insert a provision which has virtually no practical effect"104. Such a construction is also consistent with the presumption that, where the Parliament has enacted a wide and general provision (such as s 6M(b)), not limited to the admissibility of evidence in a court, such a provision should not take priority over a narrower and more specific provision (like s 6DD)105. This construction provides a more nuanced and limited prohibition on the later use of witness statements and evidence or documents before Royal Commissions. It affords the "trade-off" of which the appellants spoke. But it is 103 The Commonwealth v Baume (1905) 2 CLR 405 at 414; Beckwith v The Queen (1976) 135 CLR 569 at 574; Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 12-13; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 382 [71]. 104 Minister of State for Resources v Dover Fisheries Pty Ltd (1993) 43 FCR 565 at 574 per Gummow J. See also Tickle Industries Pty Ltd v Hann (1974) 130 CLR 321 at 331-332; Bistricic v Rokov (1976) 135 CLR 552 at 561. 105 Perpetual Executors and Trustees Association of Australia Ltd v Federal Commissioner of Taxation (1948) 77 CLR 1 at 29; Commercial Radio Coffs Harbour Ltd v Fuller (1986) 161 CLR 47 at 50, 58-59. Kirby one confined to court proceedings. It is not addressed to administrative decisions, such as those made by Mr Godfrey or APRA. Avoiding absurd constructions: In addition to the foregoing, there are at least two reasons of principle or policy why the ambit of protection argued for by the appellants should be rejected: It would produce absurd results that could not readily be attributed to the Parliament in enacting the Royal Commissions Act106. If, as a result of the evidence of a witness before a Royal Commission, an insurer learned from that witness's own admission that he or she had been involved in an act of arson that destroyed premises insured by the insurer, and if that were the only evidence of the offence and of his involvement in it, it would be absurd to deny the insurer the opportunity to refuse indemnity. A different consideration arises in respect of the admission of the evidence in later court proceedings. But the use, directly and indirectly, of evidence before the Royal Commission for non-court purposes is sensible. It is fully within the provisions of s 6DD. "[A] Court is entitled to pay the Legislature the not excessive compliment of assuming that it intended to enact sense and not nonsense"107; and (2) As well, s 6M must be given meaning in the context of the Act in which it appears. That Act is concerned with the procedures of Royal Commissions. The very purpose of such inquiries typically includes securing evidence, both oral and documentary, which can lead to criminal and civil proceedings, as the Royal Commission will often recommend and as legal entitlements and justice require. In this context, without a much clearer provision, it would be astonishing to impose an embargo on the direct and indirect use of the evidence of witnesses, the calling of whom is inferentially for the purpose of fulfilling the mandate of the Royal Commission. That mandate, typically, extends to the identification of legal proceedings, criminal and civil, that should be brought in consequence of the Royal Commission's report. It would be a needless, self-inflicted wound for the Royal Commissions Act to immunise the evidence of witnesses completely and, moreover, to forbid the use of such evidence for any purpose. This is especially so as the outcome of a Royal Commission is commonly the bringing of criminal and civil proceedings 106 Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 320-323; Australian Tea Tree Oil Research Institute v Industry Research and Development Board (2002) 124 FCR 316 at 330 [43]-[44]. 107 Hall v Jones (1942) 42 SR (NSW) 203 at 208. Kirby that typically cause justifiable damage, loss or disadvantage to those whose wrongdoing the Royal Commission exposes. The foregoing considerations set the mind searching for a different construction to s 6M(b) of the Royal Commissions Act. That search is reinforced when regard is paid to s 6DD, which contradicts the "trade-off" for witnesses who make statements or disclosures and produce documents before Royal Commissions. This is why the presence of s 6DD is so important in casting light on the meaning of s 6M(b). It is why, in my view, it is not appropriate for this Court now to excise consideration of s 6DD when offering its explanation of the meaning of s 6M(b). Least of all is it appropriate to bury the meaning of s 6M(b) in the opaque phrase "for or on account of". Having regard to the statutory purpose of establishing Royal Commissions and of the limited and specific principle contained in s 6DD, the broad cloak of immunity which the appellants argued for s 6M(b) should be rejected. It would produce absurd outcomes and undermine the achievement of some of the main objects of Royal Commissions. These results are avoided if s 6M is read as addressed only to offences of victimisation of witnesses, and if s 6DD is left to perform the work of the "trade-off" in respect of court evidence, deemed necessary by the Parliament in more limited terms to promote the provision of honest evidence to Royal Commissions. This interpretation does not entirely explain the variation between the language of s 6M(b) and s 6N(1)(b). It may still be the case that a witness is victimised for giving evidence before a Royal Commission not, as such, for having turned up but for the content of particular evidence given by him or her. Thus, par (a) of s 6M exists to punish those who would victimise the person for having appeared. And s 6M(b) exists for the added, and different, offence of victimising the person because of the content of "any evidence given by him or her". The phrase "for or on account of" When the foregoing purpose of s 6M is clearly identified, the meaning of the phrase "for or on account of", which links the cause of disadvantage by one person to another, and, relevantly, any evidence given by that other person before a Royal Commission, becomes clear. Questions of causation and of causal connection between events for legal purposes are notoriously contestable108. They can only ever be solved in a given 108 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 221 CLR 568 at Kirby context. Where what is at stake is the attribution of legal responsibility, liability or blame, it is impermissible, and unhelpful, to attempt a resolution of the problem in a conceptual vacuum. As Gleeson CJ remarked in I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd109, approved in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd110, charting the bounds of statutory expressions concerned with causation: "is done in order to give effect to a statute with a discernible purpose; and that purpose provides a guide as to the requirements of justice and equity in the case. Those requirements are not determined by a visceral response on the part of the judge … but by the judge's concept of principle and of the statutory purpose." Where the evidence given by a person before a Royal Commission is used to prove disputed facts in ways that cause damage, loss or disadvantage to the witness, this does not forbid the use of that evidence for administrative, disciplinary or other purposes of the law. Such use is not treated as "for or on account of" the evidence as such (or a document that is produced). It is, instead, "for or on account of" the pre-existing state of affairs which such evidence or document may help to prove or disprove. That pre-existing state of affairs has a reality independent of the evidence. The limitation on the use that may be made of the evidence itself, as expressed in the Royal Commissions Act, is that stated in s 6DD. This is the view of the meaning of s 6M which both the primary judge and the Full Court adopted111. In my opinion, it was the correct view. It is the one that ensures that s 6DD and s 6M(b) work sensibly together, according to their respective language and in the context of the Royal Commissions Act, read as a whole. The interpretation of s 6M(b) urged by the appellants should be rejected. Orders The appeal should be dismissed with costs. 109 (2002) 210 CLR 109 at 119 [26]. 110 (2005) 221 CLR 568 at 597-598 [100]. 111 Applicant X v Australian Prudential Regulation Authority (2006) 14 ANZ Ins Cas ¶61-667 at 75,031-75,032 [92]-[100]; Y v Australian Prudential Regulation Authority (2006) 150 FCR 469 at 491-492 [74].
HIGH COURT OF AUSTRALIA WORKPAC PTY LTD APPELLANT AND RESPONDENTS WorkPac Pty Ltd v Rossato [2021] HCA 23 Date of Hearing: 12 & 13 May 2021 Date of Judgment: 4 August 2021 ORDER Appeal allowed. Set aside the orders made by the Full Court of the Federal Court of Australia on 29 May 2020 and, in their place, declare that: (a) Mr Rossato was a casual employee for the purposes of ss 86, 95 and 106 of the Fair Work Act 2009 (Cth) in respect of each of the six assignments with WorkPac Pty Ltd between 28 July 2014 and 9 April 2018; and (b) Mr Rossato was a "Casual Field Team Member" for the purposes of the WorkPac Pty Ltd Mining (Coal) Industry Enterprise Agreement 2012. On appeal from the Federal Court of Australia Representation B W Walker SC with I M Neil SC, D W M Chin SC and C Parkin for the appellant (instructed by Ashurst) C J Murdoch QC with C G C Curtis for the first respondent (instructed by J D McKenna QC with B J O'Brien for the second respondent (instructed by S Crawshaw SC with R E Reed for the third respondent (instructed by Slater K P Hanscombe QC with J Fetter for the fourth respondent (instructed by Adero Law) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS WorkPac Pty Ltd v Rossato Industrial law (Cth) – Contract of employment – Nature of casual employment – Where first respondent employed by appellant labour-hire company under series of six employment contracts or "assignments" – Where first respondent treated as casual employee – Where first respondent not paid entitlements owed by employers to non-casual employees – Where first respondent claimed to have been other than a casual employee – Where first respondent's work pattern followed established shift structure fixed long in advance by roster – Where employment contract provided that employment was on "assignment-by-assignment basis" – Where employment contract provided that appellant under no obligation to offer first respondent further assignments – Whether there existed firm advance commitment as to duration of first respondent's employment or days (or hours) first respondent will work – Whether first respondent employed as casual employee. Words and phrases – "annual leave", "assignment-by-assignment basis", "binding contractual terms", "casual employee", "compassionate leave", "employment contract wholly in writing", "enterprise agreement", "firm advance commitment", "label", "mere expectation of continuing employment", "National Employment Standards", "nature of the employment relationship", "payment for public holidays", "personal/carer's leave", "post-contractual conduct", "regular and systematic basis", "roster". Fair Work Act 2009 (Cth), Pt 2-2. KIEFEL CJ, KEANE, GORDON, EDELMAN, STEWARD AND GLEESON JJ. The appellant ("WorkPac") is a labour-hire company whose business includes the provision of the services of its employees to firms engaged in the mining of black coal. Among WorkPac's customers is Glencore Australia Pty Ltd and its related entities ("Glencore"), which operate the Collinsville and Newlands mines in Queensland. At all relevant times, Glencore's workforce comprised both its own employees and workers sourced through labour-hire companies such as WorkPac1. The first respondent ("Mr Rossato") was an experienced production worker in the open-cut black coal mining industry. He was employed by WorkPac between 28 July 2014 and 9 April 2018, when he retired. During that time, WorkPac provided his services to Glencore at one or other of the Collinsville and Newlands mines2. At all relevant times, WorkPac treated Mr Rossato as a casual employee3. On 16 August 2018, the Full Court of the Federal Court of Australia delivered judgment in WorkPac Pty Ltd v Skene4 ("Skene"). The Full Court held that Mr Skene, who was employed by WorkPac in circumstances similar to those of Mr Rossato and who was likewise treated by WorkPac as a casual employee, was not a casual employee for the purposes of s 86 of the Fair Work Act 2009 (Cth) ("the Act") and the enterprise agreement applicable to Mr Skene5. On 2 October 2018, in reliance on the decision in Skene, Mr Rossato wrote to WorkPac claiming that he had not worked for it as a casual employee, and claiming that he was entitled to be paid for untaken annual leave, public holidays, and periods of personal leave and compassionate leave taken by him during his employment. These entitlements were said to be due under the Act and the 1 WorkPac Pty Ltd v Rossato (2020) 278 FCR 179 at 190 [18], [22] ("Rossato"). 2 Rossato (2020) 278 FCR 179 at 190 [18], [21], [23], 239 [267]. 3 Rossato (2020) 278 FCR 179 at 186-187 [2], 239 [268]. (2018) 264 FCR 536. 5 Mr Skene's employment was subject to the WorkPac Pty Ltd Mining (Coal) Industry Workplace Agreement 2007, the predecessor of the enterprise agreement that Gordon Edelman Steward Gleeson WorkPac Pty Ltd Mining (Coal) Industry Enterprise Agreement 2012 ("the Enterprise Agreement"), which governed Mr Rossato's employment6. WorkPac denied Mr Rossato's claims, and promptly filed an originating application in the Federal Court of Australia seeking declarations that throughout his employment Mr Rossato had been a casual employee for the purposes of the Act and the Enterprise Agreement. WorkPac also sought declarations that, by reason of that status, Mr Rossato was not entitled to paid annual, personal/carer's or compassionate leave or to payment for public holidays; and that he had been paid at a rate which incorporated a 25 per cent casual loading in lieu of those entitlements. In the alternative, if Mr Rossato were found to have been other than a casual employee, WorkPac sought declarations that it was entitled to set off, against the entitlements claimed by Mr Rossato, payments it had made to Mr Rossato in compensation for, or in lieu of, those entitlements; or that it was entitled to restitution in respect of the amounts it had paid to Mr Rossato in excess of his entitlement to remuneration as a permanent employee7. On 21 December 2018, Allsop CJ directed, pursuant to s 20(1A) of the Federal Court of Australia Act 1976 (Cth), that the matter be heard by a Full Court. Allsop CJ also granted leave to intervene in the proceedings to the second respondent ("the Minister") and the third respondent ("the CFMMEU")8. On 26 March 2019, Bromberg J granted leave to intervene in the proceedings to the fourth respondent ("Mr Petersen"), who is the applicant in a class action brought against WorkPac on behalf of employees who are said to have been employed in similar circumstances to Mr Skene9. WorkPac, as the moving party, sought only declaratory relief. Mr Rossato did not cross-claim for payment of his entitlements, and the Full Court was not asked to quantify those entitlements. Instead, WorkPac agreed that if Mr Rossato 6 Rossato (2020) 278 FCR 179 at 187 [3]. 7 Rossato (2020) 278 FCR 179 at 239-240 [271]-[272]. 8 WorkPac Pty Ltd v Rossato [2018] FCA 2100. 9 Rossato (2020) 278 FCR 179 at 240 [274]. Gordon Edelman Steward Gleeson were successful, it would pay him amounts which had been agreed between the parties. WorkPac also agreed to pay Mr Rossato's costs10. The Full Court of the Federal Court of Australia (Bromberg, White and Wheelahan JJ) concluded that Mr Rossato was not a casual employee for the purposes of the Act and the Enterprise Agreement. The Full Court made declarations that Mr Rossato was entitled to the payments he claimed. The Full Court rejected WorkPac's set off and restitution claims, holding that Mr Rossato's entitlements were not to be reduced by taking into account the amounts paid to Mr Rossato in excess of his entitlements to remuneration as a non-casual employee11. WorkPac now appeals to this Court, arguing that the Full Court ought to have held that Mr Rossato was a casual employee for the purposes of the Act and the Enterprise Agreement. Alternatively, WorkPac argues that the Full Court erroneously rejected its claims in relation to set off and restitution. For the reasons that follow, WorkPac's appeal should be allowed on the basis that Mr Rossato was a casual employee of WorkPac. On that footing, it is unnecessary to consider WorkPac's alternative ground of appeal. Before moving to a discussion of matters germane to the present appeal, it may be noted that the Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Act 2021 (Cth), which came into effect after the filing of this appeal but before the appeal was heard, inserted a definition of "casual employee" into the Act12. It also provided that an award of compensation for permanent employee entitlements payable to an employee mistakenly treated as a casual must be reduced by the amount of any identifiable casual loading paid to the employee13. These amendments do not apply to employees like Mr Rossato in respect of whom a court has made a binding decision before commencement that the employee is 10 Rossato (2020) 278 FCR 179 at 240-241 [276], 313 [677]. 11 Rossato (2020) 278 FCR 179 at 188 [10]-[12], 245 [292], 364 [952]. 12 Newly inserted s 15A of the Act. 13 Newly inserted s 545A of the Act. Gordon Edelman Steward Gleeson not a casual employee14. However, the amendments apply retrospectively to other employees, subject only to limited exceptions15. The amendments had the stated intention of introducing a statutory definition of casual employment that "incorporates key aspects of the common law as expressed in ... Skene and Rossato", as well as "a statutory offset mechanism so that employers will not have to pay twice for the same entitlements"16. WorkPac did not seek to argue that the amendments provided any support for its arguments in relation to the proper construction of the term "casual employee" in the Act17. Mr Rossato's employment with WorkPac It is useful at the outset to summarise in broad terms the history of Mr Rossato's employment with WorkPac to assist an understanding of the reasons of the Full Court and the arguments agitated by the parties in this Court. Mr Rossato first applied for employment with WorkPac on 21 December 2013, using an online registration form. Two days later, he attended WorkPac's office in Mackay, where he spoke to a recruitment coordinator and signed a single-page document entitled "Casual or Maximum Term Employee Terms & Conditions of Employment – Employee Declaration". By signing that document, Mr Rossato acknowledged that he had read, understood and agreed to the content 14 Newly inserted cl 46(2)-(4) of Sch 1 to the Act. 15 Newly inserted cl 46(1), (5)-(8) of Sch 1 to the Act. 16 Australia, House of Representatives, Parliamentary Debates (Hansard), 9 December 2020 at 11016. See also Australia, House of Representatives, Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill 2020, Explanatory Memorandum at ii. 17 Compare Grain Elevators Board (Vict) v Dunmunkle Corporation (1946) 73 CLR 70 at 85-86. See also Deputy Federal Commissioner of Taxes (SA) v Elder's Trustee and Executor Co Ltd (1936) 57 CLR 610 at 625-626; Masson v Parsons (2019) 266 CLR 554 at 573-574 [28]. Gordon Edelman Steward Gleeson of a document entitled "Casual or Maximum Term Employee – Terms and Conditions of Employment" ("the General Conditions")18. Mr Rossato commenced working with WorkPac on 28 July 2014 as a product operator at Glencore's Collinsville mine. He was employed with WorkPac episodically until his retirement on 9 April 2018 pursuant to a series of six contracts, or "assignments". Each contract was entitled "Notice of Offer of Casual Employment – Flat Rate"19 except for the third contract, which was entitled "Notice of Offer of Casual Employment". The contracts may conveniently be referred to as the "first NOCE" through to the "sixth NOCE" respectively. Under the first NOCE, Mr Rossato was employed to work at the Collinsville mine between 28 July 2014 and 29 May 2015. On 25 May 2015, Glencore personnel informed Mr Rossato of potential reductions in the workforce at the Collinsville mine. Over the following days, WorkPac encouraged Mr Rossato to accept a new assignment at the Newlands mine. Mr Rossato accepted the terms of the second NOCE and, pursuant to its terms, was employed to work at the Newlands mine between 1 June 2015 and 19 February 2016. The third NOCE involved a reduction in Mr Rossato's rate of pay, and governed Mr Rossato's employment at the Newlands mine between 19 February 2016 and 27 September 2016. Mr Rossato then recommenced working at the Collinsville mine, after the mine resumed operations following a period of shutdown, pursuant to the fourth NOCE, which covered the period between 27 September 2016 and 10 November 2016. The fifth and sixth NOCEs both concerned Mr Rossato's employment at the Collinsville mine and each provided for an increase in Mr Rossato's hourly rate. The fifth NOCE covered the period between 14 November 2016 and 21 December 2016 and the sixth NOCE covered the period between 21 December 2016 and Mr Rossato's retirement on 9 April 201820. 18 Rossato (2020) 278 FCR 179 at 190 [19], 245 [293]. 19 Rossato (2020) 278 FCR 179 at 190 [20], 245 [294]. 20 Rossato (2020) 278 FCR 179 at 190 [21], 245-246 [294]-[301]. Gordon Edelman Steward Gleeson In each of Mr Rossato's assignments with WorkPac, he performed work as directed by Glencore. He was allocated to work in crews pursuant to shift rosters issued by Glencore. Each crew consisted of a combination of Glencore employees and WorkPac employees, all performing the same production operator duties under the supervision of a Glencore employee21. Shift arrangements were typically set well in advance by the distribution of rosters. Both WorkPac and Mr Rossato were familiar with the regular patterns of work pursuant to these rosters22. Site rosters for the Collinsville and Newlands mines were provided by WorkPac to Mr Rossato together with the first and second NOCEs respectively23. Towards the end of each year, Glencore provided rosters for each site for the whole of the following year24. Mr Rossato worked on a "drive-in, drive-out" basis: at the commencement of each rostered-on phase of shifts, he drove to the mine site and stayed in accommodation provided by Glencore, and then drove home once the shifts were finished. The accommodation was provided at no charge, with the exception of a period at the Newlands mine during which WorkPac deducted $35 per week from Most of the time, Mr Rossato worked according to either a "7/7 roster" (seven days on, seven days off)26 or a "5/5/4 roster" (five days on, five days off, four days on, five days off, five days on, four days off)27. The only exceptions to these arrangements were a nine-day induction period at the Collinsville mine, and 21 Rossato (2020) 278 FCR 179 at 191 [24], 247 [305]. 22 Rossato (2020) 278 FCR 179 at 217 [156], 301 [600]. 23 Rossato (2020) 278 FCR 179 at 208 [107], 217 [152], 218 [160], 247 [306]. 24 Rossato (2020) 278 FCR 179 at 216 [146], 219 [165], 225-226 [203], 247 [306]. 25 Rossato (2020) 278 FCR 179 at 215 [142], 218 [159], 247 [304]. 26 Rossato (2020) 278 FCR 179 at 215-216 [144], 216 [146], 219-220 [172], 27 Rossato (2020) 278 FCR 179 at 217 [155], 247 [303]. Gordon Edelman Steward Gleeson an eight-week "start-up" period while the Collinsville mine recommenced operations after its temporary shutdown28. Both mines closed down for Christmas each year and the Collinsville mine closed between 26 March 2017 and 1 April 2017 due to Cyclone Debbie29. Apart from the mine closures, the only occasions on which Mr Rossato deviated from his rostered hours were three instances to complete additional training or induction at the direction of Glencore30, one shift in February 2016 where his crew was directed not to work because of inclement weather31, two shifts in November 2016 as directed by Glencore to allow Mr Rossato a sufficient break between changing from A Crew to D Crew32, and the period between 10 March 2018 and 5 April 2018 when Mr Rossato left the mine to care for his partner, who was suffering a serious illness and had been airlifted to hospital33. Mr Rossato returned to work for one day on 5 April 2018, before leaving again to care for his partner. Mr Rossato retired on 9 April 201834. For the duration of the six NOCEs, and aside from the incidents mentioned, Mr Rossato was never asked by WorkPac or Glencore whether he intended to attend work on a day he was rostered; nor did Mr Rossato ever enquire whether he would be required to attend work on a day he was rostered35. 28 Rossato (2020) 278 FCR 179 at 247 [303]. 29 Rossato (2020) 278 FCR 179 at 216 [145], 218 [161], 225-226 [203], 30 Rossato (2020) 278 FCR 179 at 216 [145], 218 [161], 225-226 [203]. 31 Rossato (2020) 278 FCR 179 at 218 [161], 247 [308]. 32 Rossato (2020) 278 FCR 179 at 225 [199], 247 [308]. 33 Rossato (2020) 278 FCR 179 at 225-226 [203], 247-248 [310]. 34 Rossato (2020) 278 FCR 179 at 247-248 [310]. 35 Rossato (2020) 278 FCR 179 at 216 [147], 219 [167], 220 [173], 224 [197], Gordon Edelman Steward Gleeson The entitlements claimed by Mr Rossato Under the National Employment Standards Part 2-2 of the Act contains the National Employment Standards ("the NES"), which are said by the Act to be "minimum standards that apply to the employment of employees which cannot be displaced"36. An enterprise agreement must not exclude all or any part of the NES37, and an enterprise agreement has no effect to the extent that it purports to do so38. Among the matters dealt with in the NES are minimum entitlements in respect of annual leave, personal/carer's leave, compassionate leave and public holidays. Division 6 of Pt 2-2 of the Act deals with annual leave. Section 86 provides that Div 6 "applies to employees, other than casual employees". Section 87 creates an entitlement to paid annual leave, and provides that this entitlement shall accrue progressively during a year of service and shall accumulate from year to year. Paid annual leave may be taken for a period agreed between the employee and employer, and the employer must not unreasonably refuse a request to take paid annual leave39. If an employee takes paid annual leave, the employer must pay the employee his or her base rate of pay for his or her ordinary hours of work40. Pursuant to s 90(2), if an employee has a period of untaken paid annual leave when his or her employment ends, the employer must pay the employee the amount that would have been payable had the employee taken that leave. Sections 92 to 94 prohibit the "cashing out" of paid annual leave, subject to certain prescribed exceptions. Subdivision A of Div 7 of Pt 2-2 deals with paid personal/carer's leave. Section 95 provides that Subdiv A "applies to employees, other than casual employees". Section 96 creates an entitlement to paid personal/carer's leave. Like 36 s 61(1) of the Act. See also ss 41, 44. 37 s 55(1) of the Act. 38 s 56 of the Act. 39 s 88 of the Act. 40 s 90(1) of the Act. Gordon Edelman Steward Gleeson paid annual leave, this entitlement accrues progressively during a year of service and accumulates from year to year41; when taken, obliges the employer to pay the employee his or her base rate of pay for his or her ordinary hours of work42; and may not be cashed out subject to certain prescribed exceptions43. All employees, including casual employees, are entitled to two days' unpaid personal/carer's leave44. Subdivision C of Div 7 of Pt 2-2 deals with compassionate leave. Section 104 provides that all employees, including casual employees, are entitled to compassionate leave. However, s 106 provides that only "an employee, other than a casual employee" is entitled to payment at his or her base rate of pay for his or her ordinary hours of work when taking compassionate leave. Under the Enterprise Agreement The Enterprise Agreement also provided for entitlements, which were superior in some respects to those provided by the NES. As such, the characterisation of Mr Rossato's employment for the purposes of the Enterprise Agreement remains significant. The terms of the Enterprise Agreement insofar as they governed Mr Rossato's employment conditions are summarised more fulsomely later in these reasons. For present purposes, it suffices to note that the Enterprise Agreement employed its own terminology, in that it referred to WorkPac employees as "Field Team Members" ("FTMs") and provided that FTMs were to be employed in one or more of the following five subcategories listed in full-time FTMs; or part-time FTMs; or casual FTMs; or 41 s 96(2) of the Act. 42 s 99 of the Act. 43 ss 100, 101 of the Act. 44 Pt 2-2, Div 7, Subdiv B of the Act. Gordon Edelman Steward Gleeson limited term or assignment FTMs; or FTMs employed for a specific project/site or workplace related task." Leave entitlements were dealt with in cl 19. Clause 19.2 provided that "[a]n FTM" was entitled to annual leave, in addition to the amount provided for in the NES, such that the employee's total entitlement to annual leave was 175 ordinary hours per year. However, cl 19.3, concerning accrual of annual leave, applied only to "FTMs, other than casual employees": "Accrual of annual leave FTMs, other than casual employees, accrue annual leave at the following rate: 175 hours per annum for 5 weeks annual leave (average of 3.3654 hours per week) 210 hours per annum for 6 weeks annual leave (average of 4.0385 hours per week) (a) Annual leave is cumulative from year to year. Part-time FTMs accrue annual leave on a pro-rata basis." Clauses 19.7 to 19.10 dealt with personal/carer's leave. Clause 19.7 was entitled "Personal / Carer's Leave Entitlement (Permanent FTMs)". It provided that "FTMs, other than casuals" were entitled to 105 ordinary hours of personal/carer's leave (inclusive of the NES entitlement) upon commencing employment, and each year thereafter. Untaken personal leave was to accumulate without limitation. Clause 19.10 provided that "Casual FTMs" were entitled to two days' unpaid carer's leave "in accordance with the Fair Work Act 2009". Clause 19.12 dealt with compassionate leave. Clause 19.12.1 provided that "a permanent FTM" was entitled to two days' compassionate leave for each occasion that an immediate family member or household member developed a serious personal injury or illness or died. This entitlement was expressed to be "[i]n accordance with and subject to the requirements of the Fair Work Act 2009". Permanent FTMs were entitled to be paid at the amount they would reasonably Gordon Edelman Steward Gleeson have expected to be paid if they had worked for the period of paid leave45. Clause 19.12.5 provided that "Casual FTMs" were entitled to two days' unpaid compassionate leave "in accordance with Fair Work Act 2009". Clause 20 dealt with public holidays. It provided that FTMs may be required to work on public holidays and that flat rate FTMs would be paid at their ordinary rate for any work performed on public holidays. However, it had the effect that only a "permanent FTM" stood down during December would be entitled to payment for Christmas Day, Boxing Day and New Year's Day46. A firm advance commitment Both before the Full Court47 and in this Court, the parties accepted that the expression "casual employee" in the Act refers to an employee who has no "firm advance commitment as to the duration of the employee's employment or the days (or hours) the employee will work"48. The question whether such a firm advance commitment existed in respect to Mr Rossato is pivotal to the resolution of this appeal. Given that the decision in Skene provoked the present litigation, it is desirable to begin by summarising the reasoning in that decision before turning to assess how the Full Court below addressed the issue. The decision in Skene In Skene, the Full Court of the Federal Court of Australia (Tracey, Bromberg and Rangiah JJ) held that the expression "casual employee" was used in s 86 according to its "general law meaning"49. As to that meaning, the Full Court 45 Enterprise Agreement, cl 19.12.4. 46 Enterprise Agreement, cl 20.6. 47 Rossato (2020) 278 FCR 179 at 191 [31], 240-241 [276], 244 [285], 245 [290]. 48 Skene (2018) 264 FCR 536 at 571 [153], citing Hamzy v Tricon International Restaurants (2001) 115 FCR 78 at 89 [38]. 49 Skene (2018) 264 FCR 536 at 571 [153]-[155]. Gordon Edelman Steward Gleeson adopted50 the statement of the Full Court in Hamzy v Tricon International "The essence of casualness is the absence of a firm advance commitment as to the duration of the employee's employment or the days (or hours) the employee will work." The Full Court in Skene considered that the expression "casual employee" takes its meaning, at least in part, by comparing it against other types of employment such as full-time and part-time employment52. The Full Court elaborated on the characteristics of casual employment in the following passage53: "[A] casual employee has no firm advance commitment from the employer to continuing and indefinite work according to an agreed pattern of work. Nor does a casual employee provide a reciprocal commitment to the employer. ... In our view, what is referred to in Hamzy as the 'essence of typifies casual employment and distinguishes it from either full-time or part-time employment. The indicia of casual employment referred to in the authorities – irregular work patterns, uncertainty, discontinuity, intermittency of work and unpredictability – are the usual manifestations of an absence of a firm advance commitment of the kind just discussed. An irregular pattern of work may not always be apparent but will not necessarily mean that the underlying cause of the usual features of casual employment, what Hamzy identified as the 'essence of casualness', will be absent." The Full Court noted that this understanding was consistent with the scheme of the Act, which excluded casual employees from certain leave entitlements. 50 Skene (2018) 264 FCR 536 at 571 [153]. (2001) 115 FCR 78 at 89 [38]. See also Doyle v Sydney Steel Co Ltd (1936) 56 CLR 545; Shugg v Commissioner for Road Transport and Tramways (NSW) (1937) 57 CLR 485 at 491, 496-498. 52 Skene (2018) 264 FCR 536 at 574 [170]. 53 Skene (2018) 264 FCR 536 at 575 [172]-[173]. Gordon Edelman Steward Gleeson Casual employees, being those employees who had given and received no firm advance commitment to continuing work, were therefore able to make their own arrangements for rest and recreation, and did not need to be guaranteed leave in the same way as other employees54. Their Honours went on to suggest that the characterisation of employment as casual or otherwise required an assessment of "[t]he conduct of the parties to the employment relationship and the real substance, practical reality and true nature of that relationship"55. Their Honours observed that this was the settled approach to the question whether a person was an employee as distinct from a contractor, and reasoned that the same approach was appropriate in determining the nature of an employment relationship56. Their Honours also said that regard must be had to "the surrounding circumstances created by both the contractual terms and the regulatory regime (including the [Act], awards and enterprise agreements) applicable to the employment"57. The reasoning in the Full Court in this case Before the Full Court, WorkPac argued that the question whether a firm advance commitment had been made was to be determined at the time of entry into the employment contract and, in the case of an employment contract wholly in writing, by reference solely to the express terms of the contract. Resort to post-contractual conduct as an aid to determining the nature of the employment relationship was said to be impermissible. WorkPac submitted that to the extent that it had been held in Skene that regard could be had to extrinsic matters, including post-contractual conduct, the decision was wrong and should not be followed58. This submission was renewed in this Court. 54 Skene (2018) 264 FCR 536 at 574 [168]. 55 Skene (2018) 264 FCR 536 at 576 [180]. 56 Skene (2018) 264 FCR 536 at 576 [180]. 57 Skene (2018) 264 FCR 536 at 577 [181]. 58 Rossato (2020) 278 FCR 179 at 193 [38]-[41], 244 [287]. Gordon Edelman Steward Gleeson Mr Rossato argued that, taking WorkPac's case at its highest and limiting the analysis to the written terms of the employment contracts, the requisite firm advance commitment was evident in this case from those terms59. Bromberg J and White J (with whom Wheelahan J relevantly agreed60) accepted this contention and concluded that Mr Rossato was not a casual employee61. Both of their Honours characterised the NOCEs as contracts that provided for ongoing or indefinite employment in which Mr Rossato was to work regular, constant, predictable hours fixed long in advance. In their Honours' view, employment of this type was, "by its very nature", employment that involved a firm advance commitment62. Mr Rossato had also contended63 that the proper approach to determining the existence of a firm advance commitment should be a process of "characterisation" having regard to "[t]he conduct of the parties to the employment relationship and the real substance, practical reality and true nature of that relationship"64. In this regard, Bromberg J was disposed to accept that because an employment relationship is dynamic, the character of the relationship may be discerned from the course of dealing between the parties and their conduct, not only in the written terms of the contract which created the relationship65. On this view, which Bromberg J did not consider to have been decisive in this case, it was not only the written contract which was being construed or characterised, but the entirety of the employment relationship66. 59 Rossato (2020) 278 FCR 179 at 193 [40], 194 [43]. 60 Rossato (2020) 278 FCR 179 at 364 [952]. 61 Rossato (2020) 278 FCR 179 at 194 [43], 202-203 [80], 286 [518], 288-289 [529]. 62 Rossato (2020) 278 FCR 179 at 209-210 [114], 296 [576], 298-299 [588]. 63 Rossato (2020) 278 FCR 179 at 193 [40], 245 [290], 266 [405]. 64 Skene (2018) 264 FCR 536 at 576 [180]. 65 Rossato (2020) 278 FCR 179 at 195 [46]. 66 Rossato (2020) 278 FCR 179 at 195-197 [50]-[54]. Gordon Edelman Steward Gleeson White J was not persuaded that the conclusion in Skene, that it was appropriate to assess the totality of the relationship in determining the nature of the employment relationship, was plainly wrong67. However, his Honour expressed his preference for the contrary view: that the existence of a firm advance commitment was properly to be assessed at the time of the commencement of the employment relationship, subject to the possibility of later variation68. White J said, rightly, that the Act contemplates that employer and employee alike should know the employment69. Nevertheless, as will be seen, his Honour was influenced in his reasoning by the approach in Skene, which, for reasons which follow, was erroneous. their obligations and entitlements at the commencement of In this Court, WorkPac submitted that the characterisation of an employee as "casual" depends entirely on the express or implied terms of the employment contract and (in the case of wholly written employment contracts) without reference to post-contractual conduct. WorkPac noted, by reference to ss 65(2), 67(2) and 384(2) of the Act, that the Act explicitly recognises that casual employment can be "long term", and can involve "a reasonable expectation of continuing employment ... on a regular and systematic basis". WorkPac submitted that no firm advance commitment was evident in the express or implied terms of any of the six NOCEs or otherwise. WorkPac argued that White J erred in the significance he accorded to the rosters pursuant to which Mr Rossato worked, contending that regularity of work is consistent with casual employment. WorkPac emphasised that it was not obliged by the contracts to offer any assignments to Mr Rossato and that he could accept or reject any offer of an assignment. WorkPac submitted that Mr Rossato had been categorised as a "casual FTM" for the purposes of the Enterprise Agreement by virtue of WorkPac informing him (as required by cl 6.4.7) in each NOCE that the status of his engagement was "casual employment", and Mr Rossato accepting each offer of 67 Rossato (2020) 278 FCR 179 at 304 [623]-[624], 305 [628]-[630]. 68 Rossato (2020) 278 FCR 179 at 285-286 [512]. 69 Rossato (2020) 278 FCR 179 at 281-282 [482]-[484], 285 [510]. Gordon Edelman Steward Gleeson employment. In this regard, WorkPac accepted that the label "casual" was neither essential nor controlling. None of the members of the Full Court found a firm advance commitment limited in duration. In this Court, Mr Rossato accepted that the relevant firm advance commitment must be for an indefinite period in this case although, in a different case, a firm advance commitment for a fixed period might be sufficient to demonstrate that the employment is not casual. Mr Rossato argued that he had a firm advance commitment to his working hours, agreed by roster, such that neither he nor WorkPac ever had to confirm or query whether he was required for work or whether he would attend work on a particular day. Mr Rossato submitted that Glencore's workforce organisation meant the work he was employed to perform was ongoing and indefinite, and WorkPac's need for him to perform this work was stable and predictable. Mr Rossato emphasised that he was engaged to work a "standard work week"70, according to rostered hours, and alongside full-time Glencore employees. Mr Rossato also noted that he worked at the mine on a drive-in, drive-out basis and stayed in accommodation arranged by WorkPac in advance. The respondents who had been granted leave to intervene also made submissions. The CFMMEU and Mr Petersen made submissions generally in support of Mr Rossato. Those submissions did not shed any additional light on the issues before the Court. For the sake of completeness, however, these submissions will be referred to briefly after the arguments agitated by WorkPac and Mr Rossato have been discussed. The nature of the requisite firm advance commitment The Act contemplates casual employment may be regular As the issue before this Court is, ultimately, a matter of statutory interpretation, it is as well to begin a consideration of the arguments of the parties with some reference to the Act. 70 Enterprise Agreement, cll 1.6, 14.2; General Conditions, cll 6.28, 7.1; first NOCE, "Daily Working Hours" clause. Gordon Edelman Steward Gleeson The Act did not, at material times, define the term "casual employment". However, the view that there must exist a "firm advance commitment" to continuing work unqualified by indicia of irregularity, such as uncertainty, discontinuity, intermittency and unpredictability, in order for employment to be other than casual conforms with several provisions of the Act. In s 65, which is concerned to facilitate requests by employees for changes in their working arrangements, s 65(2) provides that an employee is: "not entitled to make the request unless: for an employee other than a casual employee – the employee has completed at least 12 months of continuous service with the employer immediately before making the request; or for a casual employee – the employee: is a long term casual employee of the employer immediately before making the request; and has a reasonable expectation of continuing employment by the employer on a regular and systematic basis." Section 65(2)(b)(i) thus contemplates that an employee may be a casual employee even though the employee is a "long term casual employee", which is a term defined to mean a casual employee who71: "has been employed by the employer on a regular and systematic basis for a sequence of periods of employment during a period of at least 12 months." Section 65(2)(b)(ii) demonstrates further that the Act does not regard the existence of "a reasonable expectation of continuing employment ... on a regular and systematic basis" to be inconsistent with the nature of casual employment. Rather, such an expectation is entirely consistent with an employee's status as a casual. It can therefore be seen that, so far as the Act is concerned, such an expectation, however reasonable, remains an expectation only and falls short of a "firm ... commitment". A reasonable expectation of continuing employment is 71 s 12 of the Act. Gordon Edelman Steward Gleeson simply not the kind of firm advance commitment to continuing employment the absence of which typifies casual employment. Similar observations may be made in relation to ss 67(2) and 384(2)(a) of the Act. The latter provision is particularly noteworthy in that it is designed to protect employees from unfair dismissal where they have completed a minimum period of employment. Section 384(2)(a) provides: "[A] period of service as a casual employee does not count towards the employee's period of employment unless: the employment as a casual employee was on a regular and systematic basis; and during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis". These contextual considerations are strong indications that a mere expectation of continuing employment, however reasonable, is not a basis for distinguishing the employment of other employees from that of a casual employee. White J considered these provisions only in the limited context of addressing the question of when a person's status as a casual employee is to be determined72. It is noteworthy, however, that none of the members of the Full Court considered that these provisions had a bearing upon the nature of the firm advance commitment that distinguishes other types of employment from casual employment. A firm advance commitment is an enforceable commitment In this Court, Mr Rossato's counsel submitted that the existence of "ambiguities" in the written agreements between the parties justified advertence to the manner in which the parties performed the employment to assess whether there was a mutual firm advance commitment to continuing employment on an indefinite basis. Mr Rossato's counsel did not, in the course of argument, press any identified "ambiguity" upon this Court in support of this line of argument. 72 See Rossato (2020) 278 FCR 179 at 279-280 [469]-[472], 282 [488]-[490], Gordon Edelman Steward Gleeson Additionally, and importantly, it is to be noted that counsel for Mr Rossato expressly disavowed any suggestion that the contractual agreements between the parties were sham transactions not to be given effect according to their tenor. No suggestion was made that the six NOCEs were intended, in truth, not to be a series of separate engagements but instead to be a disguise for one continuing engagement between the parties. In the absence of such a contention, there is no reason not to regard the NOCEs and associated contractual documents as true, reliable and realistic statements of the rights and obligations to which the parties agreed to bind themselves. In Commonwealth Bank of Australia v Barker73, French CJ, Bell and "The employment relationship, in Australia, operates within a legal framework defined by statute and by common law principles, informing the construction and content of the contract of employment." A court can determine the character of a legal relationship between the parties only by reference to the legal rights and obligations which constitute that relationship. The search for the existence or otherwise of a "firm advance commitment" must be for enforceable terms, and not unenforceable expectations or understandings that might be said to reflect the manner in which the parties performed their agreement. To the extent that Bromberg J expressed support for the notion that the characterisation exercise should have regard to the entirety of the employment relationship74, his Honour erred. While it is true to say that "[t]he history of the employment relationship is considerably longer than the history of the employment contract"75, it is also true that the evolution of the employment relationship is "a classic illustration of the shift from status (that of master and servant) to that of contract (between employer (2014) 253 CLR 169 at 178 [1]. 74 Rossato (2020) 278 FCR 179 at 195-197 [50]-[54]. 75 Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 182 [16]. Gordon Edelman Steward Gleeson and employee)"76. Nothing in the statutory framework within which the employment relationship in the present case has been established relevantly inhibits the freedom of parties to enter into a contract for casual employment. So far as casual employment is concerned, the Act leaves the making of such an arrangement to be agreed between employer and employee. In the Full Court, White J referred77 to the discussion of the two-tiered structure of an employment contract in Freedland's The Personal Employment Contract78, where it was said that: "At the first level there is an exchange of work and remuneration. At the second level there is an exchange of mutual obligations for future performance. The second level – the promises to employ and be employed – provides the arrangement with its stability and its continuity as a contract. The promises to employ and to be employed may be of short duration, or may be terminable at short notice; but they still form an integral and most important part of the structure of the contract. They are the mutual undertakings to maintain the employment relationship in being which are inherent in any contract of employment properly so called." (emphasis in original) White J went on to say79: "In the present context, it is the existence and nature of the underlying mutual undertakings in the second tier which are in question. The undertakings of that kind are commonly not express. They may be implicit in the contract or be inferred from other matters which are express. In an informal contract, they may, like any other term, be inferred from the parties' conduct. 76 Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 182-183 [16], citing Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 436. 77 Rossato (2020) 278 FCR 179 at 276 [446]. 78 Freedland, The Personal Employment Contract (2003) at 91. 79 Rossato (2020) 278 FCR 179 at 276 [447]-[448]. Gordon Edelman Steward Gleeson This counts against WorkPac's submission that the firm advance commitment must be express. It may, however, suggest that the requisite commitment involves something more than an expectation." It is difficult to square these last observations with his Honour's expressed preference for an approach focussed upon the written agreements of the parties, subject to the possibility of a contractual variation80. Indeed, it is difficult to be confident about what is meant by "something more than an expectation" if that "something more" is not a binding agreement between the parties by way of a contract or a variation of a contract. Something that is not binding cannot meaningfully be described in a court of law as a "commitment" at all. Some amorphous, innominate hope or expectation falling short of a binding promise enforceable by the courts is not sufficient to deprive an agreement for casual employment of that character. To insist upon binding contractual promises as reliable indicators of the true character of the employment relationship is to recognise that it is the function of the courts to enforce legal obligations, not to act as an industrial arbiter whose function is to synthesise a new concord out of industrial differences. That it is no part of the judicial function to reshape or recast a contractual relationship in order to reflect a quasi-legislative judgment as to the just settlement of an industrial dispute has been emphatically the case in Australia at the federal level since the To insist that nothing less than binding contractual terms are apt to characterise the legal relationship between employer and employee is also necessary in order to avoid the descent into the obscurantism that would accompany acceptance of an invitation to enforce "something more than an expectation" but less than a contractual obligation. It is no part of the judicial function in relation to the construction of contracts to strain language and legal concepts in order to moderate a perceived unfairness resulting from a disparity in bargaining power between the parties so as to adjust their bargain. It has rightly 80 Rossato (2020) 278 FCR 179 at 285-286 [512]. 81 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254. See also Dietrich v The Queen (1992) 177 CLR 292 at 320. In relation to the position at State level, see Fish v Solution 6 Holdings Ltd (2006) 225 CLR 180. Gordon Edelman Steward Gleeson been said that it is not a legitimate role for a court to force upon the words of the parties' bargain "a meaning which they cannot fairly bear [to] substitute for the bargain actually made one which the court believes could better have been made"82. Even the recognised doctrines of unconscionability or undue influence do not support such a course; and in any event, neither Mr Rossato, nor any of the interveners, sought to suggest that the doctrines of unconscionability or undue influence had any part to play in the resolution of the present dispute. Notwithstanding the express preference of White J for a contractual analysis that establishes the parties' enforceable rights and duties at the commencement of the employment, his Honour reasoned to his conclusion by reference to notions of "underlying"83 and "unspoken mutual undertaking[s]"84, shared "contemplation[s]"85, "indication[s]"86 and "expectation[s]"87. None of these notions amounted to express contractual terms; nor would any have satisfied the test for the implication of a term88. The deployment of these notions signals a departure from orthodox legal analysis. Three additional points may be made here. First, while mutual undertakings may not always be express, where there are express terms of the contract between the parties, they must be given effect unless they are contrary to statute. Secondly, if the mutual undertakings are said to be implied in what has been agreed, they 82 Charter Reinsurance Co Ltd v Fagan [1997] AC 313 at 388. 83 Rossato (2020) 278 FCR 179 at 276 [447]. 84 Rossato (2020) 278 FCR 179 at 296 [572]. See also 291 [542], 292 [549], 302 [609]. 85 Rossato (2020) 278 FCR 179 at 292 [548]. See also 292 [547]. 86 Rossato (2020) 278 FCR 179 at 298 [588]. 87 Rossato (2020) 278 FCR 179 at 291 [543], 300 [594]; cf 276 [448]. 88 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 453; Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 68 [78]. Compare Breen v Williams (1996) 186 CLR 71 at 80, 90-92, 102-103, 123-124. Gordon Edelman Steward Gleeson cannot be inconsistent with the express terms of the contract89. Thirdly, if the mutual undertakings are to be inferred from conduct, then they may take effect as contractual variations. It is because contracts, whether as originally agreed or as varied, create binding obligations they constitute "firm advance commitments". that Skene fell into error In light of this discussion, it should now be understood that in approaching the characterisation exercise by reference to "[t]he conduct of the parties to the employment relationship and the real substance, practical reality and true nature of that relationship"90, the Full Court in Skene strayed from the orthodox path. None of the authorities cited by the Full Court in Skene91 in support of its approach to the characterisation exercise were cases where the parties had committed the terms of the employment relationship to a written contract and thereafter adhered to those terms. In such a case, it is to those terms that one must look to determine the character of the employment relationship. WorkPac's submission that Skene was wrongly decided in this respect should be accepted. The terms and conditions of Mr Rossato's employment It is necessary now to consider the terms and conditions governing the employment relationship between Mr Rossato and WorkPac in order to discern whether they established a firm advance commitment to continuing work beyond the completion of an assignment. Mr Rossato's employment was governed by the General Conditions, the Enterprise Agreement, and the six NOCEs92. Mr Rossato and the CFMMEU argued that Glencore's rosters provided to Mr Rossato formed part of the contractual suite of documents regulating 89 BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 90 Skene (2018) 264 FCR 536 at 576 [180]. 91 Skene (2018) 264 FCR 536 at 576 [180]. 92 See Rossato (2020) 278 FCR 179 at 190 [20], 253 [336]. Gordon Edelman Steward Gleeson Mr Rossato's employment93. In this Court, the significance of this contention shifted to become a suggestion that these rosters, combined with the contractual stipulations that Mr Rossato was to work in accordance with his rostered arrangements, were in some way evidence of an obligation and entitlement to work the entire roster. As to this, it may be said immediately that the provision of Glencore's rosters to Mr Rossato fell well short of being, even arguably, a contractual promise that he would be entitled or required to work all the shifts listed. The General Conditions The General Conditions were expressed to apply to "all assignments" undertaken by an employee on behalf of WorkPac94. Clause 5.1 provided that employment with WorkPac was on an "assignment-by-assignment basis, with each assignment representing a discrete period of employment on a Casual or Maximum Term hourly basis". Clause 5.3 provided that an employee could accept or reject any offer of an assignment. Clause 5.4 provided: "The employee agrees to complete an assignment once the employee has accepted it. Should the employee elect not to complete the assignment for whatever reason, WorkPac reserves the right to recover any costs incurred relating to the employee's assignment." Clause 5.5 provided: "On completion of an assignment, whether satisfactory or otherwise, WorkPac is under no obligation to offer any other assignment/s." Clause 5.6 provided that the period of an assignment could be varied by WorkPac, or by WorkPac's client, on one hour's notice. Clause 5.12 provided that casual assignments could be terminated by either WorkPac or the employee on one 93 A similar contention was advanced in the Full Court: see Rossato (2020) 278 FCR 179 at 253 [336]. The Full Court held that it was unnecessary to decide this question: 94 General Conditions, cl 4.2. Gordon Edelman Steward Gleeson hour's notice. All employees were to serve a six-month minimum qualifying period95. Employees on an assignment with WorkPac agreed to work exclusively The General Conditions provided for ordinary working hours of between 35 and 38 hours per week and provided that the employee may be requested to work such reasonable additional hours as requested by WorkPac97. Clause 7.4 required employees to work shifts and/or rosters "as prescribed in the Notice of Offer of Employment", and additional or replacement shifts or rosters as agreed to during the engagement. There was provision for employees to be stood down without pay in the event of strike, breakdown of machinery or other circumstances beyond WorkPac's control98. The NOCEs The six NOCEs shared common features. All referred to the employment as an "assignment" with Glencore at one or other of the two mines. There were some differences between the first three NOCEs and the fourth, fifth and sixth NOCEs, but in the scheme of things those differences are not significant. It will be sufficient to refer to the first three NOCEs. The first three NOCEs identified Mr Rossato's daily working hours as "06:00 – 17:00" (in the first and second NOCEs) or "06:00 – 18:30" (in the third NOCE), but each noted "[t]his may vary and is a guide". Likewise, the first three NOCEs provided for a length of assignment of "6 Months" (in the first and third NOCEs) or "154 Days" (in the second NOCE), again noting in each case that "[t]his may vary and is a guide only". The first three NOCEs each identified that Mr Rossato would work an alternating shift structure, and the first two NOCEs referred to the working of additional reasonable hours in accordance with "your rostered arrangements". 95 General Conditions, cl 5.11. 96 General Conditions, cl 6.15. 97 General Conditions, cl 7.1. 98 General Conditions, cll 7.1, 7.14. Gordon Edelman Steward Gleeson Each of the first three NOCEs contained some reference to a "casual loading". The first and second NOCEs provided for a flat rate of pay of $49 per hour, and included the following note: "Your flat rate of pay includes the payment of overtime, weekend penalties, public holiday loadings, shift penalties, casual loading (refer to Schedule 2 for more information on your casual loading) and any industry and special allowances that may apply." The third NOCE did not contain such a note and instead provided for a "casual rate" of pay: "Your Pay Rate is a Casual Rate of: Normal Time Time Half Double Time The third NOCE did, however, refer Mr Rossato to Schedule 2 in the following note: "If any other allowances are applicable to your role, the amount that would be paid is detailed below, (please note payment is ONLY if applicable). Refer to Schedule 2 for more information on your casual loading." The Schedule 2 referred to in each of the first three NOCEs contained a breakdown of the "casual loading" in the following terms: "Schedule 2 – Configuration of Casual Loading Your ordinary rate of pay is your hourly rate less your performance incentive bonus where applicable. Refer to the appropriate Agreement contained in Schedule 1[99] to determine your casual loading. Where your casual loading is 25%, it is made up of the following components: 99 Schedule 1 was titled "Where do I find my Agreement?" and listed 21 workplace or the Enterprise Agreement applicable including enterprise agreements, Gordon Edelman Steward Gleeson 11% of your loading is paid in lieu of Annual Leave and Leave Loading entitlements; 5% of your loading is paid in lieu of Personal Leave entitlement; 4% of your loading is paid in lieu of Notice of Termination requirements; 2.5% of your loading is paid in recognition of the itinerant nature of casual work; 2.5% of your loading is paid in lieu of Redundancy entitlements. If your casual loading is less than 25% as prescribed in your Agreement, the above breakdown applies to your casual loading on a pro rata basis." The Enterprise Agreement The provisions of the Enterprise Agreement, insofar as they regulated Mr Rossato's entitlements to leave, have been set out above. The Enterprise Agreement also contained terms which regulated Mr Rossato's employment and which are relevant to the assessment of whether there existed a firm advance commitment to ongoing work. Pursuant to cl 6 of the Enterprise Agreement, all FTMs were required to perform work within their skill, competence and training as required by WorkPac100 and follow all reasonable and lawful directions101. Refusal to comply with any reasonable and lawful direction could result in disciplinary action, including termination102. All new FTMs were engaged on a six-month "qualifying period", after which their employment status would be confirmed103. Clause 6.4 was entitled "Status of Employment". Clause 6.4.7 provided that FTMs would, at the time of their engagement, be informed by WorkPac "of the 100 Enterprise Agreement, cl 6.3.1. 101 Enterprise Agreement, cl 6.2.1. 102 Enterprise Agreement, cl 6.2.2. 103 Enterprise Agreement, cl 6.1. Gordon Edelman Steward Gleeson status and terms of their engagement". As foreshadowed above, cl 6.4.1 purported to categorise FTMs in the following way: "FTMs under this Agreement will be employed in one or more of the following categories: full-time FTMs; or part-time FTMs; or casual FTMs; or limited term or assignment FTMs; or FTMs employed for a specific project/site or workplace related task." Clauses 6.4.2 to 6.4.4 further categorised FTMs into "base rate FTMs" and "flat rate FTMs" depending on whether they were engaged on the basis of, and paid, a base rate of pay or a flat rate of pay. It was not in dispute that Mr Rossato was a "flat rate FTM"; the only question was whether his employment was casual or otherwise. Clauses 6.4.5 and 6.4.6 contained further terms relating to "casual FTMs", including terms relating to "casual loading": "6.4.5 Casual FTMs will be for a minimum of four (4) hours: (a) A person engaged as a base rate casual, as defined in clause 9.1.1, will be paid a casual loading of 25% on the rates prescribed herein. The casual loading is in lieu of all paid leave entitlements (with the exception of long service leave). (b) A person engaged as a flat rate casual, as defined in clause 9.1.1, will not be paid an additional amount as the casual loading has been incorporated into the flat rate of pay. 6.4.6 As your casual loading is 25%, it is made up of the following components: 11% of your loading is paid in lieu of Annual Leave and Leave Loading entitlements; Gordon Edelman Steward Gleeson 5% of your loading is paid in lieu of Personal Leave entitlement; 4% of your loading is paid in lieu of Notice of Termination requirements; 2.5% of your loading is paid in recognition of the itinerant nature of casual work; 2.5% of your loading is paid in lieu of Redundancy entitlements." Clause 6.5.1 provided the notice period for termination by either WorkPac or an FTM. For "[a]ll FTMs other than casuals", notice of one week or longer was required, with the period of notice increasing based on length of service. For "[a]ll Casual FTMs", no notice of termination was required. Clause 9.1.1 dealt with wage rates. It provided, in relation to flat rate FTMs: "At the election of the Company an FTM will be paid either: Flat Rate FTMs The flat rate of pay as prescribed in Schedules 3, 4, 5, 6 and 7 for each classification. Flat rates are provided as compensation for all work (including overtime, weekend penalties, public holiday loadings, shift penalties, annual leave loading (where applicable), casual loading (where applicable), any industry and special allowances that apply to all FTMs covered by this Agreement and any industry and special allowances specifically incorporated that may not apply to all FTMs covered by this Agreement. Flat Rate FTMs shall also be entitled to any applicable allowances (which have not already been specifically incorporated) provided for by this Agreement unless such allowance is identified as applying only to Base Rate FTMs." Clause 14 specified hours of work for flat rate FTMs. It provided that ordinary hours of work for a flat rate FTM were a "standard work week", plus Gordon Edelman Steward Gleeson reasonable additional hours104. A flat rate FTM could be employed on either day work or shift work, and was required to work hours "as rostered by [WorkPac] to meet business operational needs"105. Clause 14.9 then provided: "Flat rate FTMs do not receive any additional payment for overtime loadings, weekend penalty rates, shift penalties, annual leave loading, casual loading (where applicable), public holiday rates or time worked outside the spread of hours as these have been incorporated into the flat rate." No commitment to ongoing work The provisions which are critical to the assessment of the existence or otherwise of a firm advance commitment to ongoing work are cll 5.1, 5.3 and 5.5 of the General Conditions. These clauses expressly provided that Mr Rossato's employment was on an "assignment-by-assignment basis", with Mr Rossato entitled to accept or reject an offer of an assignment and WorkPac under no obligation to offer any further assignments. On the plain and ordinary meaning of these provisions, the parties deliberately avoided a firm commitment to ongoing employment once a given assignment had been completed. Once it is accepted, as it must be, that these clauses bound the parties according to their ordinary meaning, it must also be accepted that on a straightforward application of the test which the parties accepted to be the hallmark of casual employment, Mr Rossato was a casual employee. It was not, and could not be, suggested that WorkPac and Mr Rossato agreed, at any time, that once an assignment was completed he would thereupon be engaged for further assignments. That this was so is readily understandable. Indeed, the whole point of the arrangements under which the parties undertook one assignment at a time was that there should be no basis for any suggestion that either of them was providing a firm advance commitment to continuing work in circumstances not marked by indicia of irregularity, such as uncertainty, discontinuity, intermittency and unpredictability. The absence of a firm advance commitment to ongoing work is also reflected in cll 5.6 and 5.12 of the General Conditions. These provided for 104 Enterprise Agreement, cl 14.2. 105 Enterprise Agreement, cl 14.3. Gordon Edelman Steward Gleeson variation of the period of an assignment, or termination of an assignment, on one hour's notice. The conferral of a power unilaterally to vary the period of an assignment cannot be confused with the creation of a mutual obligation to pursue a continuing working relationship beyond the completion of a given assignment. In the Full Court, White J placed significant reliance on cl 5.4. By that clause, Mr Rossato agreed to complete each assignment, and WorkPac reserved the right to recover any costs relating to the assignment if Mr Rossato elected not to do so. In his Honour's view, cl 5.4 made implausible the notion that Mr Rossato could elect to work or not work any shift as he chose from time to time, and was evidence of the firm advance commitment given by Mr Rossato to WorkPac106. In so concluding, his Honour erred. Clause 5.4 must be read in context. The obligation to "complete an assignment" must be read together with the right of either party under cl 5.12 to terminate an assignment on one hour's notice. Given the evident tension between those clauses, the right of recovery conferred by cl 5.4 also cannot be given an expansive operation. It is arguable that it has no operation at all unless a right of recovery can be found to have been "reserve[d]" elsewhere in the contractual arrangements between the parties. It may also be that the right of recovery could not extend beyond the recovery of any costs thrown away in transporting the employee to and from the worksite, or the costs of one hour's notice period not duly provided. But it is not necessary to resolve these issues, because, on any view, cl 5.4 cannot be understood to impose an obligation on an employee to work beyond the completion of an assignment, and so lends limited weight to the notion that Mr Rossato provided a firm advance commitment to continue to work on an ongoing basis. The significance of the roster system Much of the argument in this Court, as in the Full Court, focussed upon the significance of the roster system under which Mr Rossato was obliged to work. For the reasons which follow, that Mr Rossato's working hours were fixed by rosters is of limited significance, and the Full Court placed inordinate emphasis on this facet of Mr Rossato's employment. The first two NOCEs, in providing for Mr Rossato's daily working hours, referred to "rostered arrangements". Clause 7.4 of the General Conditions also 106 Rossato (2020) 278 FCR 179 at 293-294 [557]-[558], 298-299 [588]. Gordon Edelman Steward Gleeson required Mr Rossato to work "shifts and or rosters as prescribed in the [NOCEs]". It will be recalled that Mr Rossato was provided with rosters for Glencore's mines which fixed his working hours up to a year in advance. The Full Court considered that the fact that Mr Rossato was to work in accordance with an established shift structure fixed long in advance by roster was strongly indicative of a firm advance commitment107. No doubt the availability of an organised team of employees who would work regular, full-time hours according to a fixed pattern of work was as important to WorkPac as it was to its customer, Glencore. It may also be accepted that WorkPac, as Glencore's supplier of labour, appreciated this and engaged employees in order to satisfy this requirement108. Nevertheless, to say, as the Full Court did, that Mr Rossato would have had an appreciation of Glencore's system of work from his previous experience working at open-cut coal mines, including the Collinsville mine109, or that it would have been uncommercial for Glencore (and thus for WorkPac) to engage employees on the basis of an irregular or discontinuous work pattern110, is to fall distinctly short of describing a commitment on the part of Mr Rossato and WorkPac to an ongoing employment relationship beyond the completion of each assignment. The Full Court erred in attributing to the systematic nature of Mr Rossato's work under Glencore's rosters a significance that was critical to that Court's ultimate characterisation of Mr Rossato's employment as one that involved a firm advance commitment to continuing work beyond the completion of the particular assignment. Inasmuch as the rosters imbued Mr Rossato's employment with the qualities of regularity and systematic organisation during the period of each assignment, those qualities have been demonstrated to be entirely compatible with the notion of "casual employment" in the Act. What was absent was a firm advance commitment to continuing work beyond the completion of the particular assignment. While Mr Rossato might fairly be said to have had, over time, a reasonable expectation of continuing employment on a regular and systematic 107 Rossato (2020) 278 FCR 179 at 210 [115]. See also 295 [565]-[566], 108 Rossato (2020) 278 FCR 179 at 214 [136]-[137]. 109 Rossato (2020) 278 FCR 179 at 214-215 [138], 290-291 [541]. 110 Rossato (2020) 278 FCR 179 at 210 [118], 214 [136]-[137]. See also 298 [587]. Gordon Edelman Steward Gleeson basis, that was not a firm advance commitment to continuing employment beyond the particular assignment. Indeed, the express terms of the contracts between them, especially cll 5.1, 5.3 and 5.5 of the General Conditions, were inconsistent with the making of any such commitment. Labels are not decisive Mr Rossato was described as a casual employee by the NOCEs. It is true, of course, that whether employment is casual or not for the purposes of the Act is not determined by the "label" which the parties choose to attach to their relationship111. The character of the relationship between the parties is established by the rights and obligations which constitute the relationship112. Nevertheless, use by the parties in their contract of the label "casual" might be a factor which influences the interpretation of their rights and obligations. That said, Mr Rossato was paid a casual loading pursuant to cll 6.4.5 and 6.4.6 of the Enterprise Agreement, which clauses were incorporated into each of the NOCEs. The circumstance that, as in this case, the parties expressly agreed that the employee would be paid a loading in lieu of entitlements whose rationale presupposes an ongoing working relationship extending beyond the duration of a particular assignment (such as, for example, an entitlement to paid annual leave) is a compelling indication by the parties that their relationship did not include such a commitment. The interveners' submissions The CFMMEU submitted that the Full Court ought to have decided that Mr Rossato was not a casual employee based on a characterisation of his employment at the time the impugned statutory entitlements arose, rather than at the time the contract was made at the outset of the employment. The CFMMEU supported the observations of Bromberg J as to the merits of such an approach113. 111 Australian Mutual Provident Society v Chaplin (1978) 52 ALJR 407 at 409-410; 18 ALR 385 at 389-390; Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 600-601. 112 R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138 at 151. 113 Rossato (2020) 278 FCR 179 at 197 [54]. Gordon Edelman Steward Gleeson The CFMMEU also submitted that regard should be had to the real substance, practical reality and true nature of the employment relationship, for the reasons given by the Full Court in Skene, which adopted that approach. The submissions by the CFMMEU, if accepted, would mean that the parties could not know what their respective obligations were at the outset of their relationship and would not know until a court pronounced upon the question. That outcome does not accord with elementary notions of freedom of contract114. The submissions by the CFMMEU involve the very kind of obscurantism that has been said to be alien to the judicial function115. Mr Petersen submitted that WorkPac's contention that the characterisation of Mr Rossato's employment depended entirely on the express or implied terms of the contracts was wrong on two grounds. First, authorities concerning the employee and contractor distinction, including Hollis v Vabu Pty Ltd116, consider the "totality of the relationship" between the parties. Further, Mr Petersen contended that Doyle v Sydney Steel Co Ltd117 was authority for the proposition that the question of who is a casual worker depends on all the circumstances. These submissions may be dealt with seriatim. Hollis v Vabu was concerned with whether a person was an employee or an independent contractor of another. On one view, the resolution of that question may depend upon the extent to which it can be shown that one party acts in the business of, and under the control and direction of, the other118. It should be borne in mind that the answer to that question affects the rights not only of the parties to the arrangement but also of third parties with whom they deal under its colours. As much is illustrated by Hollis v Vabu itself. There the ultimate issue was whether the appellant enjoyed rights against Vabu or merely against the hapless and impecunious courier. In contrast, the present case is concerned with the character of an employment relationship, a question the resolution of which has no 114 Connelly v Wells (1994) 55 IR 73 at 74. 115 See [63]. 116 (2001) 207 CLR 21 at 33 [24]. 117 (1936) 56 CLR 545. 118 R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd (1952) 85 CLR 138 at 151. Gordon Edelman Steward Gleeson significance for the rights of persons who are not privy to the relationship. The analysis in Hollis v Vabu affords no assistance, even by analogy, in the resolution of a question as to the character of an employment relationship, where there is no reason to doubt that the terms of that relationship are committed comprehensively to the written agreements by which the parties have agreed to be bound. This Court's decision in Doyle concerned a workers' compensation claim made by the appellant boilermaker against the respondent company. At the time, the statutory workers' compensation regime provided for a particular method of calculating "average weekly earnings" of a "casual worker". The Workers' Compensation Commission found that the appellant was a "casual" and this decision was not disturbed by the Supreme Court of New South Wales. The High Court, comprised of four Justices, was split on the question whether the appellant was a casual employee. This Court being evenly split, the decision of the Supreme Court of New South Wales was affirmed. The only member of the Court to comment on the test to be applied was McTiernan J, who said119: "Each case is to be determined on its own facts, consideration being given not only to 'the nature of the work but also the way in which the wages are paid, or the amount of the wages, the period of time over which the employment extends, indeed all the facts and circumstances of the case'120." To say, as did McTiernan J, that the resolution of the issue depends on "all the facts and circumstances" is not to say anything very helpful at all. In any event, many years have elapsed since the modest observations of McTiernan J, and in that time, as has been seen, a consensus has emerged in the case law as to the distinguishing characteristics of casual employment. Indeed, within a year of the decision in Doyle, in Shugg v Commissioner for Road Transport and Tramways "The expression 'casual' is a word of indefinite meaning which elsewhere has caused difficulty. We are apt to associate with the word elements of 119 Doyle v Sydney Steel Co Ltd (1936) 56 CLR 545 at 565. 120 Stoker v Wortham [1919] 1 KB 499 at 503-504. 121 (1937) 57 CLR 485 at 496. Gordon Edelman Steward Gleeson chance or of discontinuity. We perhaps think of casual employment as occasional or intermittent." His Honour went on to say of the use of the term in the statutory context then before the Court122: "The distinction upon which the application of [the Act] turns is, I think, between a general, indefinite or continuous employment and an employment for a particular occasion or occasions, or to fulfil some special or defined purpose of brief duration." In these observations of Dixon J can be seen the basis for the view that has come to prevail. Conclusion The contractual arrangements between WorkPac and Mr Rossato did not include a mutual commitment to an ongoing working relationship between them after the completion of each assignment. The express terms of the relationship between WorkPac and Mr Rossato were distinctly inconsistent with any such commitment. Mr Rossato's entitlement to remuneration was agreed on that basis. That the performance of Mr Rossato's obligations was organised in accordance with Glencore's rosters and thereby exhibited features of regularity and consistency did not establish a commitment between the parties to an ongoing working relationship after each assignment was completed. In carrying out each assignment, Mr Rossato worked as a casual employee. Orders The appeal should be allowed and the orders of the Full Court set aside. In their place, it should be declared that Mr Rossato was a casual employee for the purposes of ss 86, 95 and 106 of the Act in respect of each of the six assignments with WorkPac between 28 July 2014 and 9 April 2018. It should also be declared that Mr Rossato was a "Casual Field Team Member" for the purposes of the Enterprise Agreement. 122 Shugg v Commissioner for Road Transport and Tramways (NSW) (1937) 57 CLR Gordon Edelman Steward Gleeson No order as to costs was sought. 109 The central question in this appeal is as to the meaning of undefined references to "casual employee" in the Fair Work Act 2009 (Cth) ("the Act"), which defines "employee" by reference to the ordinary meaning of that term123. The question was of national importance at the time of the grant of special leave to appeal. The importance of the question diminished with the subsequent insertion into the Act of a definition of "casual employee"124. The definition operates comprehensively for the future. The definition also operates for the past subject to the narrowest of exceptions125. A relevant exception is in relation to a person previously determined by a court not to be a casual employee126. This Court is restricted by the nature of the appeal to determining the meaning and application of the Act as the Act stood at the time of the decision under appeal127. That restricted temporal focus does not, however, require it to ignore the circumstance that the new definition has stripped the decision under appeal128 and the earlier decision on which the decision under appeal was based129 of precedential effect and that its own decision on the appeal will have significance for few other than the parties. The legislatively confined consequences of the appeal provide justification and incentive for determining the appeal by a process of reasoning that is no more expansive than is strictly necessary to determine the rights of the parties that are in issue. That is the approach I prefer to adopt. The parties were agreed that "[t]he essence of casualness is the absence of a firm advance commitment as to the duration of the employee's employment or 123 Section 12 of the Act (definitions of "employee" and "national system employee") and ss 13-15 of the Act. 124 Section 15A of the Act as inserted by the Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Act 2021 (Cth). 125 Clause 46 of Pt 10 of Sch 1 to the Act as inserted by the Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Act. 126 Clause 46(2)(a) of Pt 10 of Sch 1 to the Act. 127 Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73 at 106-111; Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541 at 556 [31]. 128 WorkPac Pty Ltd v Rossato (2020) 278 FCR 179. 129 WorkPac Pty Ltd v Skene (2018) 264 FCR 536. the days (or hours) the employee will work"130. They were at issue as to whether the undefined expression limited the firm advance commitment, absence of which they agreed was necessary for an employee to be a casual employee, to an enforceable contractual obligation on the part of the employer. "The evolution in the common law as to the relationship of employment has been seen as a classic illustration of the shift from status (that of master and servant) to that of contract (between employer and employee)"131. But the transformation has not been so complete for it yet to have been said that the relationship between employer and employee has been subsumed within the law of contract. The legally cognisable incidents of an employment relationship have not to date been treated as wholly coincident with the terms of a contract of service. To the contrary, the observation has been made and repeated in this Court that it would be "unusual" for an employment relationship to be defined purely by contract132. And in respect of an employment relationship founded on a contract of service, as in respect of other forms of relationship founded on other forms of contract, it has been and remains not uncommon for a court to be required to examine some non-contractual aspect of the relationship (sometimes referred to as an "arrangement" or "collateral arrangement"133) in order to characterise the relationship for some statutory purpose. Whether the firm advance commitment accepted by the parties to have been needed to exclude an employee from the undefined statutory references to "casual employee" was limited to an enforceable contractual obligation is therefore an issue which, to my mind, cannot be resolved by reference merely to the nature of the relationship of employment or the nature of judicial power. Were resolution of the issue necessary to the determination of the rights of the parties, I would have felt the need to give greater attention to the statutory context and to industrial usage than was given in the decision under appeal and in the argument on the appeal. My preference is not to undertake that exercise if the rights of the parties can be determined without resolution of the issue. They can. 130 Hamzy v Tricon International Restaurants (2001) 115 FCR 78 at 89 [38]. 131 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 436, referring to Attorney- General for New South Wales v Perpetual Trustee Co Ltd (1955) 92 CLR 113 at 122-123; [1955] AC 457 at 482-483. 132 Concut Pty Ltd v Worrell (2000) 75 ALJR 312 at 315 [17]; 176 ALR 693 at 697; Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 182-183 [16]. 133 See eg s 106 of the Industrial Relations Act 1996 (NSW), considered in Fish v Solution 6 Holdings Ltd (2006) 225 CLR 180. On the hearing of the appeal, it was common ground between the parties that Mr Rossato had been engaged by WorkPac under six consecutive contracts of employment. Though there appeared to be a measure of agreement between the parties that a contract of employment to work regular hours for a long fixed period might not give rise to a relationship of casual employment, argument on the appeal proceeded on the basis that the firm advance commitment, absence of which was necessary for Mr Rossato to meet the undefined statutory description of a "casual employee", was a commitment not only as to the regularity of the hours he was to work but also as to the indefinite duration of his employment. Mr Rossato relied on non-contractual aspects of his employment relationship (principally the operation of the roster system) only to establish the existence of a firm advance commitment as to the hours that he was to work during his employment. To the extent he sought to establish a firm advance commitment as to the duration of his employment, he was driven to rely solely on the terms of each contract of employment. I agree with the plurality that the terms of each contract of employment contained nothing to oblige WorkPac to continue each contract of employment beyond completion of the assignment to which each contract related. That feature of the relationship between Mr Rossato as employee and WorkPac as employer was enough in the circumstances to negative the existence of any firm advance commitment on the part of WorkPac to the indefinite continuation of Mr Rossato's employment. He was a "casual employee". The result is that I agree with the orders proposed by the plurality.
HIGH COURT OF AUSTRALIA JOHN HOLLAND PTY LTD (ACN 004 282 268) PLAINTIFF AND VICTORIAN WORKCOVER AUTHORITY DEFENDANT John Holland Pty Ltd v Victorian Workcover Authority [2009] HCA 45 13 October 2009 ORDER Order that the questions reserved in the amended stated case dated 29 September 2009 be answered as follows: Question 1: While the Plaintiff remains a "non-Commonwealth licensee" for the purposes of the [Occupational Health and Safety Act 1991 (Cth) ("the Federal OHS Act")], is the Plaintiff liable to conviction for offences against s 21 and s 23 of the [Occupational Health and Safety Act 2004 (Vic) ("the State OHS Act")] committed before the Plaintiff became a "non-Commonwealth licensee"? Answer: Yes. Question 2: If the answer to question 1 is "yes", while the Plaintiff remains a "non-Commonwealth licensee" for the purposes of the Federal OHS Act, are any (and if so which) of ss 7, 8 and/or 130 of the State OHS Act invalid within s 109 of the Commonwealth Constitution to the extent that any of those provisions purports to empower the Defendant to authorise an inspector to bring proceedings against the Plaintiff for offences against s 21 and s 23 of the State OHS Act allegedly committed before the Plaintiff became a "non-Commonwealth licensee"? Answer: Question 3: If the answer to question 2 is "yes", is the consequence that: the Inspector could not procure the issuing, on or about 24 September 2008, of a charge and summons against the Plaintiff alleging the commission of offences against s 21 and s 23 of the State OHS Act at Morwell and other places in the State of Victoria in or about October 2006; and the proceeding brought against the Plaintiff by the Inspector on or about 24 September 2008, alleging the commission of offences against s 21 and s 23 of the State OHS Act at Morwell and other places in the State of Victoria in or about October 2006, is incompetent? Answer: Does not arise. Question 4: Who should pay the costs of the stated case? Answer: The Plaintiff. Representation D F Jackson QC with G J Hatcher SC and S P Donaghue for the plaintiff (instructed by Harris & Company) P J Hanks QC with F I Gordon for the defendant (instructed by Corrs Chambers Westgarth Lawyers) Interveners S J Gageler SC, Solicitor-General of the Commonwealth with C P Young intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales with J V Agius SC and A M Mitchelmore intervening on behalf of the Attorney- General for the State of New South Wales (instructed by Crown Solicitor (NSW)) M G Hinton QC, Solicitor-General for the State of South Australia with S A McDonald intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor (SA)) J D McKenna SC with A M Pomerenke intervening on behalf of the Attorney- General of the State of Queensland (instructed by Crown Law (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS John Holland Pty Ltd v Victorian Workcover Authority Constitutional law (Cth) – Inconsistency between Commonwealth and State laws – Occupational Health and Safety Act 1991 (Cth) ("OHS Act") – Occupational Health and Safety Act 2004 (Vic) ("State Act") – Provisions of State Act empowered inspectors to bring proceedings for an offence against State Act – Plaintiff charged with offences under State Act – OHS Act relevantly applies to employers that are "non-Commonwealth licensees" – Plaintiff became non- Commonwealth licensee after alleged offences committed but prior to charges being laid – Whether while plaintiff remains a non-Commonwealth licensee for purposes of OHS Act it is liable for conviction under State Act for offences allegedly committed before plaintiff became a non-Commonwealth licensee – Whether provisions of State Act authorising prosecution of such offences inconsistent with OHS Act and thereby invalid by operation of s 109 of the Constitution. Words and phrases – "employer", "law", "non-Commonwealth licensee". Constitution, s 109. Occupational Health and Safety Act 1991 (Cth), ss 3, 4, 5(1). Occupational Health and Safety Act 2004 (Vic), ss 7(1)(c), 21, 23, 130. Safety, Rehabilitation and Compensation Act 1998 (Cth), Pt VIII. FRENCH CJ, GUMMOW, HAYNE, HEYDON, CRENNAN, KIEFEL AND BELL JJ. Pursuant to s 18 of the Judiciary Act 1903 (Cth) a Justice of this Court has stated an amended case and reserved questions for consideration of the Full Court. The OHS Act and the State Act To understand the nature of the dispute it is convenient to begin with the Occupational Health and Safety Act 1991 (Cth) ("the OHS Act"). The objects of that statute include (s 3(a)): "to secure the health, safety and welfare at work of employees the Commonwealth, of Commonwealth authorities and of non-Commonwealth licensees". The term "non-Commonwealth licensee" is defined in s 5(1) so as to identify a body corporate for which there "is in force" a licence under another law of the Commonwealth, Pt VIII of the Safety, Rehabilitation and Compensation Act 1988 (Cth) ("the SRC Act"). (emphasis added) Part 2 of the OHS Act (ss 16-23A) makes detailed provision for the duties of "employers" relating to occupational health and safety. Schedule 2 Pt 1 provides for civil enforcement proceedings and Pt 2 creates various offences for contravention of the duties created by Pt 2 and lays out penalty provisions. The term "employer" means the Commonwealth, a Commonwealth authority or a non-Commonwealth licensee (s 5(1)). Section 7(1)(c) of the relevant State statute, the Occupational Health and Safety Act 2004 (Vic) ("the State Act") confers upon the defendant ("the Authority") the function of monitoring and enforcing compliance with that statute. Section 21 creates offences which include the offences by an employer of failing in the duty to provide or maintain plant or systems of work that are, so far as is reasonably practicable, safe and without risks to health (s 21(2)(a)) and the duty to provide information, instruction, training or supervision to employees necessary to enable employees to perform their work in a way that is safe and without risks to health (s 21(2)(e)). Section 23(1) requires an employer to ensure, so far as is reasonably practicable, that third parties are not exposed to health and safety risks arising from the undertaking of the employer. Offences against ss 21 and 23 are indictable offences (s 21(4) and s 23(2) respectively). Crennan Bell Proceedings for an indictable offence may be commenced within two years after the offence is committed or the Authority becomes aware the offence was committed, or at any time with the written authorisation of the Director of Public Prosecutions (s 132). The plaintiff, by prosecution commenced in a State court on 24 September 2008, was charged with offences against these provisions of s 21 and s 23, allegedly committed in the State of Victoria on or about October 2006. The informant was an inspector appointed by the Authority under Pt 9 (ss 95-126) of the State Act. An inspector was empowered by s 130 to bring proceedings for an offence against the State Act. It is important to note the date of the alleged offences. In October 2006, the plaintiff was not a "non-Commonwealth licensee" and so had no duties imposed upon it under the OHS Act. There was then no licence in force under Pt VIII of the SRC Act to meet the definition of "non-Commonwealth licensee" in s 5(1) of the OHS Act. At that stage no question of the operation of s 109 of the Constitution could have arisen. Indeed, the relevant licensing provisions under the federal law did not exist in October 2006. The provisions were added to the OHS Act by the OHS and SRC Legislation Amendment Act 2006 (Cth) ("the 2006 Act") and commenced on 14 March 2007. The licence under Pt VIII of the SRC Act was granted on 13 December 2006 with a commencing date of 1 January 2007 ("the plaintiff's licence"). The plaintiff's licence has remained in force at all times since 1 January 2007. On the commencement of the 2006 Act on 14 March 2007 and by reason of the plaintiff's licence under Pt VIII of the SRC Act then being in force, the plaintiff became a "non-Commonwealth licensee" and an "employer" within the meaning of the definition of those terms in the OHS Act. The stated case On 19 February 2009 the plaintiff commenced the proceeding in this Court, invoking the original jurisdiction conferred by s 76(i) of the Constitution and s 30(a) of the Judiciary Act 1903 (Cth). Question 1 of the questions stated for the consideration of the Full Court asks whether while the plaintiff remains a non-Commonwealth licensee for the Crennan Bell purposes of the OHS Act it is liable for conviction under s 21 and s 23 of the State Act the plaintiff became a "non-Commonwealth licensee". For the reasons which follow, this should be answered "yes". for offences committed before Question 2 assumes an affirmative answer to Question 1 and then asks whether within the meaning of s 109 of the Constitution certain provisions of the State Act are invalid to the extent that they purport to empower the defendant to authorise the bringing of proceedings against the plaintiff for offences against the State Act allegedly committed before the plaintiff became a "non-Commonwealth licensee" under the OHS Act. This should be answered Question 3 assumes an affirmative answer to Question 2 and then asks whether the proceedings brought against the plaintiff alleging the commission of offences in or about October 2006 is incompetent. This question does not arise, given the negative answer to Question 2. The issue that its prosecution under The plaintiff contends the State Act, commenced after it became a "non-Commonwealth licensee" and an "employer" within the meaning of the OHS Act, is incompetent, and enlists the operation of s 109 of the Constitution to mandate that conclusion. Counsel for the plaintiff identified the underlying issue in the case as whether once his client became subject to the OHS Act it ceased to be liable to prosecution for offences allegedly previously committed against the State Act; what had taken place was itself unaffected by the federal law but the provisions of the State law which enabled a prosecution to be instituted were rendered inoperative. The defendant attracted the Attorneys-General of the Commonwealth, New South Wales, South Australia and Queensland. interventions by support of the The submissions of the defendant and the interveners are to the effect that upon its proper construction the OHS Act evinces an intention to exclude the operation of the State Act only to the extent to which the State Act would purport to impose rights and obligations in relation to occupational health and safety of those who were "employers" or "employees" at the time the relevant workplace conduct occurred. The result is said to be that: (a) the OHS Act applies to Crennan Bell conduct of the plaintiff occurring on and from the commencement of the 2006 Act, namely 14 March 2007, or on the commencement of a licence, whichever is the later; (b) the OHS Act does not speak to the continuing operation of the State Act upon the earlier alleged conduct; (c) s 4 of the OHS Act, upon which the plaintiff particularly relies, cannot operate of its own force to render inoperative any State law and, rather, indicates the particular field upon which the OHS Act makes exhaustive or exclusive provision, and (d) that field does not extend to the prosecution of offences under State law for acts or omissions alleged in a period before the plaintiff became a "non-Commonwealth licensee". Section 4 of the OHS Act Section 4 of the OHS Act has the chapeau "Act excludes some State and Territory laws". The text of the section is as follows: "Exclusion of State and Territory laws Subject to subsection (2), this Act is intended to apply to the exclusion of any law of a State or Territory (other than a law prescribed under subsection (3)) to the extent that the law of the State or Territory relates to occupational health or safety and would otherwise apply in relation to employers, employees or the employment of employees. Note: For the meaning of employer and employee, see section 5. State or Territory laws not excluded from applying to situations not covered by this Act If, because of section 14 or 15, provisions of this Act do not apply in relation to a particular situation, subsection (1) is not intended to affect the application of State or Territory laws to that situation. Allowing certain State or Territory laws to apply If a State or Territory law deals with a matter relating to occupational health or safety that is not dealt with by or under this Act, the regulations may prescribe the law as not being intended to be excluded by this Act. Interpretation Crennan Bell In this section, a reference to laws of a State or Territory includes a reference to such laws as they have effect as applied provisions within the meaning of the Commonwealth Places (Application of Laws) Act 1970. In this section: law includes a provision of a law (including, for example, a formula or a component of a formula)." (original emphasis) Section 4 of the OHS Act is drawn in a fashion which resembles the plan of s 16 of Workplace Relations Act 1996 (Cth). The validity of s 16 was attacked by Western Australia in The Work Choices Case1 as a "bare attempt to limit or exclude State legislative power" without the Commonwealth itself enacting a law which would prevail to the extent of inconsistency by reason of s 109 of the Constitution. In response, the Commonwealth had declined to contend that a federal law might simply exclude State law in a field and make no provision on that subject. Rather, the Commonwealth successfully submitted that s 16 was to be supported as an indication of the relevant field the federal law was intended to cover to the exclusion of State law and that s 109 operated accordingly. The section did not purport to state, impermissibly, the result of the operation of s 109, or to displace or expand its operation2. Conclusions In the present case there is no challenge to the validity of s 4. Rather, the dispute concerns its proper construction. Section 4 in terms is addressed to "the Act". To achieve the objectives stated in s 3, the statute operates prospectively upon those such as the plaintiff who answer the temporally expressed definition of "non-Commonwealth licensee" and thus the definition of "employer". It imposes the duties specified in Pt 2, with attendant enforcement provisions of Pt 5. The section then states an intention as to the scope of the application of the (2006) 229 CLR 1 at 164-169 [364]-[372]; [2006] HCA 52. 2 Botany Municipal Council v Federal Airports Authority (1992) 175 CLR 453 at 464-465; [1992] HCA 52. Crennan Bell Act with respect, relevantly, to State law. The section does not purport to do what it could not do, and to operate directly upon State law. That is left to the operation of s 109 of the Constitution. The legislative power of the Parliament extends to the expression in a law of its intention to cover a particular field of activity or to refrain from doing so. Such a law assists in the resolution, as a matter of statutory construction, of the question of the existence of such an intention. In the light of a provision such as s 4 it is not necessary to undertake a detailed analysis of the remaining provisions of the Act in order to determine with precision the field which it is intended the law should cover. That is set out in the express statement of legislative intent. But such a statement is only a statement of intention which informs the construction of the Act as a whole. It must be an intention which the substantive provisions of the Act are capable of supporting. Absent that necessary qualification, the character of a bare statement of intention could approach that of a bare exclusion of State law. As Mason J emphasised in The Queen v Credit Tribunal; Ex parte General Motors Acceptance Corporation3 a law of the Commonwealth cannot operate of its own force to invalidate or render inoperative a State law. His Honour said4: it deals, "although a provision in a Commonwealth statute which attempts to deny operational validity to a State law cannot of its own force achieve that object, it may nevertheless validly evince an intention on the part of the statute to make exhaustive or exclusive provision on the subject with which Equally a Commonwealth law may provide that it is not intended to make exhaustive or exclusive provision with respect to the subject with which it deals, thereby enabling State laws, not inconsistent with Commonwealth law, to have an operation. Here again the Commonwealth law does not of its own force give State law a valid operation. All that it does is to make it clear that the Commonwealth law is not intended to cover the field, thereby bringing s 109 into play. (1977) 137 CLR 545 at 562; [1977] HCA 34. (1977) 137 CLR 545 at 563. Crennan Bell thereby leaving room for the operation of such State laws as do not conflict with Commonwealth law." In this case the substantive provisions of the Act support the statement of intention set out in s 4. Section 4, in its application with respect to State law, discloses a limited intention of exclusion by the use of the phrase "to the extent that ...". The limitation has two limbs which "target" a limited class of State laws. First the State law must be one which relates to occupational health or safety and secondly it must be the case that the State law "would otherwise apply in relation to employers, employees, or the employment of employees". The essential difficulty with the plaintiff's case is that it responds to the first but not to the second limb. The plaintiff was an "employer" within the meaning of s 4 when on 24 September 2008 it was charged under s 130 of the State Act with the offences against ss 21 and 23 allegedly committed before it acquired that status of "employer". Each of ss 21 and 23 is to be treated for the purposes of s 4 as a "law". This follows from s 4(5) which provides that in s 4, "law" includes a provision of a law. Can it be said within the meaning of s 4 that ss 21 and 23 of the State Act, the offence provisions, are laws of a State which "would otherwise apply" in relation to the plaintiff as an "employer"? The answer must be in the negative. Again, to the extent that s 130 provides for the prosecution of a corporation in respect of an offence allegedly committed before it became an "employer", it is not to that extent a State law applying in relation to an "employer". The apparent purpose of s 4 is to relieve "employers" from the observance of the concurrent operation of multiple sets of legislatively imposed duties, whether imposed by State or Territorial law. That objective assumes the operation of the federal system for the securing of the health, safety and welfare of employees. It is not advanced by a construction of s 4 which would absolve those who become "employers" from liability to prosecution for offences against a State occupational health and safety law allegedly committed before that status was acquired. Reference was made in submissions to sub-sections of s 4 following upon Crennan Bell The provisions of s 4(1) are subjected to s 4(2). This confirms that in certain circumstances, not presently relevant, where substantive provisions of the OHS Act do not apply, State and Territory laws are not intended to be excluded. This provision does not assist the plaintiff's case. Nor does the presence of s 4(3). The sub-section confers a power to prescribe by regulation a State or Territory law as not intended to be excluded by the OHS Act. The power is exercisable where the State or Territory law "deals with a matter relating to occupational health or safety that is not dealt with by or under [the OHS Act]". The exercise of this power serves to limit in the cases where it is exercised what otherwise would be the scope of the phrase "to the extent that" in s 4(1). The particular law may answer both limbs of s 4(1), but be excluded by regulation from the intention to exclude. In the present case, s 4(1) has no relevant operation to provide the occasion for the exercise of power under Orders The questions should be answered: (1) Yes. (3) Does not arise. By the plaintiff.
HIGH COURT OF AUSTRALIA Matter No M92/2008 APPELLANT AND THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA RESPONDENT Matter No M93/2008 AND APPELLANT THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA RESPONDENT Spriggs v Commissioner of Taxation Riddell v Commissioner of Taxation [2009] HCA 22 18 June 2009 M92/2008 & M93/2008 ORDER 1. Appeals allowed. 2. Set aside the orders made in paragraphs 1 and 2 of the orders of the Full Court of the Federal Court of Australia, made on 22 August 2008 in each appeal, and in lieu thereof order that the appeals to that Court be dismissed. On appeal from the Federal Court of Australia Representation R Merkel QC with N Orow for the appellants in both matters (instructed by DLA D H Bloom QC with R A Brett QC and M T Flynn for the respondents in both matters (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Spriggs v Commissioner of Taxation Riddell v Commissioner of Taxation Taxes and duties – Income tax – Deductions – Appellant taxpayers professional Australian Rules football player and professional rugby league player – Each paid fee to manager for negotiating contract to play with new club – Whether management fee deductible under Income Tax Assessment Act 1997 (Cth), s 8-1(1) as outgoing "incurred in gaining or producing" or "necessarily incurred in carrying on a business for the purpose of gaining or producing" assessable income – Whether each appellant carrying on business exploiting sporting prowess and associated celebrity – Relevance of exclusion from definition of "business" in s 995-1 of "occupation as an employee" – Relevance of Federal Commissioner of Taxation v Maddalena (1971) 45 ALJR 426; 2 ATR 541. Taxes and duties – Income tax – Deductions – Whether management fee not deductible pursuant to s 8-1(2)(a) as an "outgoing of capital, or of a capital nature". Words and phrases – "business", "incurred in gaining or producing", "necessarily incurred in carrying on a business", "occupation as an employee", "ordinary income", "outgoing of capital". Income Tax Assessment Act 1997 (Cth), ss 6-5(1), 8-1, 995-1. the Commonwealth of Australia FRENCH CJ, GUMMOW, HEYDON, CRENNAN, KIEFEL AND BELL JJ. These appeals arise out of the assessment of income tax made by the Commissioner of Taxation of ("the Commissioner"), the respondent to each appeal, in respect of each of the appellants, Mr David Raymond Spriggs ("Spriggs") and Mr Mark Riddell ("Riddell"), for the year of income ended 30 June 2005 ("the 2005 income year"). Before, during and after the 2005 income year, Spriggs was a professional Australian Rules football player, who played for clubs in the Australian Football Competition, and Riddell was a professional rugby league player, who played for clubs in the National Rugby League Competition. The issue in these appeals is whether the appellants were entitled to deductions, pursuant to s 8-1 of the Income Tax Assessment Act 1997 (Cth) ("the ITAA"), for fees paid by each of them to his respective manager during the 2005 income year ("the management fees"). The Commissioner refused to allow deductions for the management fees in assessments of the appellants' respective liabilities to income tax in respect of the 2005 income year. Each of the appellants objected to those assessments1, but their objections were disallowed by the Commissioner. The appellants then appealed from these "objection decisions" to the Federal Court of Australia2. The primary judge (Gordon J) concluded that the management fees were deductible, set aside the Commissioner's objection decisions and substituted decisions allowing the deductions3. However, the Full Court of the Federal Court (Goldberg, Bennett and Edmonds JJ) ("the Full Court") unanimously allowed appeals by the Commissioner and made orders effectively reinstating the Commissioner's objection decisions4. It is from the decision of the Full Court that the appellants now appeal, by special leave, to this Court. The appeals to this Court were heard together. 1 Pursuant to s 175A of the Income Tax Assessment Act 1936 (Cth) and Pt IVC, Div 3 of the Taxation Administration Act 1953 (Cth). 2 Pursuant to s 14ZZ and Pt IVC, Div 5 of the Taxation Administration Act 1953 (Cth). 3 Spriggs v Federal Commissioner of Taxation (2007) 68 ATR 740; Riddell v Federal Commissioner of Taxation (2007) 68 ATR 757. 4 Federal Commissioner of Taxation v Spriggs (2008) 170 FCR 135. Crennan Bell For the reasons which follow, the Full Court was in error to conclude that the management fees were not deductible. Accordingly, the appeals to this Court should be allowed and the orders of the primary judge restored. The facts Both in the Full Court5 and this Court, it was accepted by the parties that there is no significant distinguishing feature between the cases of each appellant. The relevant facts of each case are as follows. Spriggs. The Australian Football Competition ("the AFL Competition") is the elite Australian Rules football competition conducted by the Australian Football League ("the AFL"), a public company limited by guarantee. At all relevant times, 16 clubs participated in the AFL Competition. From 2000 to 2006, Spriggs played for two of those clubs in succession. In each case, he was contracted to play Australian Rules football on a full-time basis pursuant to an AFL Standard Playing Contract between him, the club and the AFL. Each AFL Standard Playing Contract entered into by Spriggs was a standard contract in a form prescribed by the AFL and the Australian Football League Players' Association Incorporated ("the AFLPA"), modified to include particular conditions relating to Spriggs. Each incorporated a Collective Bargaining Agreement between the AFL and the AFLPA, which will be described in more detail later in these reasons6. As was agreed in each AFL Standard Playing Contract, the "AFL Player Rules", determined by the AFL, were binding on both Spriggs, as a player, and each club which contracted with him. The AFL Player Rules in effect require that any person playing in the AFL Competition be a party to an AFL Standard Playing Contract. The AFL Player Rules also regulate the conduct of the yearly "AFL National Draft", which enables clubs to select players to play for them from a list of eligible players who have nominated for the Draft. 5 Federal Commissioner of Taxation v Spriggs (2008) 170 FCR 135 at 136 [3] per Goldberg, Bennett and Edmonds JJ. 6 See [36]-[40]. Crennan Bell In November 1999, Spriggs was selected by the Geelong Football Club Limited ("Geelong") from the AFL National Draft for that year. On 7 January 2000, he entered into a "Representation Agreement" with Connors Sports Management Pty Ltd ("CSM"). The term of the Representation Agreement was for two years, but it was extended by agreement between the parties and was in place for the 2005 income year. The Representation Agreement relevantly provided: "1. Contract Services: CSM hereby warrants that a duly accredited player agent will represent, advise, council [sic] and assist the player[7] in the negotiation and enforcement of his AFL Standard Playing Contract(s) in the Australian Football League. 2. Appointment: CSM will for the full term of this agreement act as the Player's exclusive Agent throughout Australia in respect of the Player's activities as a professional AFL footballer including the players [sic] AFL Contract with his respective Club, endorsements, merchandising, appearances and media contracts. 3. CSM's compensation: If CSM succeeds in negotiating an AFL Standard Playing Contract or contracts acceptable to the player, CSM shall be paid a fee as follows: 3% of the Player's total gross earnings for the term of the contract[.] The player will pay the following fees for marketing and media activities: 20% of the total gross earnings in relation to marketing, and media activities." Spriggs was contracted to Geelong, pursuant to successive AFL Standard Playing Contracts, for the 2000 to 2004 AFL Competition seasons. Mr Paul Connors ("Connors") of CSM negotiated terms to be included in all but the first of these contracts. 7 Defined in the Representation Agreement to be Spriggs. Crennan Bell During the 2004 AFL Competition season, Connors and Spriggs considered that it might be appropriate for Spriggs to move to another club in the AFL Competition. Connors became involved in various negotiations with representatives of a number of clubs towards that end. the AFL National Draft. On 31 October 2004, Spriggs' then current contract with Geelong came to an end. Spriggs was thereupon eligible, under the AFL Player Rules, to Following negotiations with nominate for representatives of the Sydney Swans Ltd ("Sydney") and another club, Connors ultimately agreed on the minimum terms and conditions that Sydney would meet if they selected Spriggs in the Draft. On 20 November 2004, Spriggs was selected in the Draft for that year by Sydney. On 9 December 2004, he entered into an AFL Standard Playing Contract for the 2005 and 2006 AFL Competition seasons, consistent with the terms negotiated by Connors ("Spriggs' 2005/2006 Contract"). Among other things, it provided for a "Base Payment" for the 2005 AFL Competition season of $70,000. The view of the primary judge was that it was a contract of employment8. On 20 December 2004, CSM issued a tax invoice to Spriggs. Against an amount of $2,100, the notation on the invoice read: "Management and promotional services by CSM for season 2004". This amount was equivalent to 3% of the Base Payment for the 2005 AFL Competition season in Spriggs' 2005/2006 Contract. The conclusion of the primary judge was that the fee was paid by Spriggs to CSM for negotiating Spriggs' 2005/2006 Contract9. Including GST of $210, the total amount payable was $2,310. It is this fee which the Commissioner contends is not deductible by Spriggs in the 2005 income year. At the end of the 2006 AFL Competition season, Spriggs' 2005/2006 Contract with Sydney came to an end. He did not subsequently play with any other club in the AFL Competition. The Representation Agreement with CSM came to an end. 8 Spriggs v Federal Commissioner of Taxation (2007) 68 ATR 740 at 752 [47] per 9 Spriggs v Federal Commissioner of Taxation (2007) 68 ATR 740 at 751-752 [46] Crennan Bell Riddell. The National Rugby League Competition ("the NRL Competition") is the premier rugby league competition in Australia and New Zealand, conducted by National Rugby League Limited ("the NRL"), a public company limited by guarantee. Sixteen clubs participate in the NRL Competition. From 1998, Riddell played for three clubs in the Competition in succession. In each case, he was contracted to play rugby league on a full-time basis pursuant to an NRL Playing Contract between him and his club. There was a Collective Bargaining Agreement, between the Rugby League Professionals Association and NRL clubs, which dealt with industrial issues. The rules and regulations of the NRL Competition, including the "NRL Playing Contract and Remuneration Rules", are determined by the NRL. Under the NRL Playing Contract and Remuneration Rules, any club that participates in the NRL Competition must ensure that the club and its players have complied with those Rules. Under the Rules, any person who wishes to participate as a player in the NRL Competition must, among other things, be a party to a current NRL Playing Contract with a club. The NRL Playing Contract is a standard contract. As was agreed in each NRL Playing Contract entered into by Riddell, the NRL Playing Contract and Remuneration Rules were binding on him. On 29 May 1998, Riddell entered into an agreement with International Sports Management Pty Ltd ("ISM"). He was contracted to play for the Eastern Suburbs District Rugby League Football Club Limited for the 1998 to 2000 NRL Competition seasons. On 27 July 2000, he entered into an NRL Playing Contract with St George Illawarra Rugby League Football Club ("St George") for the 2001 NRL Competition season, and then on 6 June 2001 he entered into an NRL Playing Contract with St George for the 2002 to 2004 NRL Competition seasons. Also on 6 June 2001, Riddell entered into an agreement with SFX Sports Group (Australia) Pty Ltd ("SFX"), which had acquired ISM during the course of 1999. The term of the agreement was five years, and it was in place during the 2005 income year. The second recital stated: "The Player[10] desires to exclusively engage the Manager[11] to exclusively manage his affairs as hereinafter set out." Pursuant to cl 1, SFX agreed to provide the following services to Riddell: 10 Defined in the agreement to be Riddell. 11 Defined in the agreement to be SFX. Crennan Bell "a) Advise the Player in respect of his sporting career. Negotiate playing contracts on behalf of the Player. Negotiate product endorsements and sponsorship so far as is reasonably possible. Access and arrange legal, financial, superannuation, taxation, insurance and other appropriate advices and services at the request and cost of the Player. Develop and maintain a mutually agreeable communication timetable. Provide such other services and advices as may reasonably be required by the Player." Pursuant to cl 4(a), SFX was entitled to charge "[t]wenty per cent (20%) of all gross monies or other considerations paid to the Player for sponsorship, media contracts, endorsement for goods and services, advertising or any form of promotional work and any subsequent income earned from the above monies." Pursuant to cl 4(b)(i), SFX was entitled to charge "[s]even percent (7%) of all contract monies paid to the Player including bonuses/incentives negotiated by the Manager." Each of the NRL Playing Contracts entered into by Riddell mentioned above was negotiated by ISM or SFX. During the 2004 NRL Competition season, Darryl Mather ("Mather") of SFX unsuccessfully attempted to negotiate a new NRL Playing Contract for Riddell with representatives of St George. Riddell was then granted permission, as required by his contract with St George and the NRL Playing Contract and Remuneration Rules, to negotiate with other clubs in the NRL Competition. Mather negotiated on Riddell's behalf with representatives of Parramatta National Rugby League Club Limited ("Parramatta") and another club, and, ultimately, agreed terms with the representatives of Parramatta. On 22 June 2004, Riddell entered into an NRL Playing Contract with Parramatta for the 2005 to 2007 NRL Competition seasons ("Riddell's 2005/2007 Contract"). Among other things, it provided for an annual Crennan Bell playing fee of $275,000 for each of those years. The view of the primary judge was that it was a contract of employment12. On 17 November 2004, SFX issued a tax invoice to Riddell. Against an amount of $19,250, the notation on the invoice read: "2005 Management Fees". This amount was equivalent to 7% of the annual playing fee under Riddell's 2005/2007 Contract. The conclusion of the primary judge was that the fee was payment to SFX for negotiating Riddell's 2005/2007 Contract13. Including GST of $1,925, the total amount payable was $21,175. It is this fee which the Commissioner contends is not deductible by Riddell in the 2005 income year. As at 18 July 2007, Riddell was contracted to Parramatta pursuant to an NRL Playing Contract for the 2007 to 2009 NRL Competition seasons. The applicable legislation Section 8-1 of the ITAA relevantly provides: "(1) You can deduct from your assessable income any loss or outgoing to the extent that: it is incurred in gaining or producing your assessable income; or it is necessarily incurred in carrying on a business for the purpose of gaining or producing your assessable income. (2) However, you cannot deduct a loss or outgoing under this section to the extent that: it is a loss or outgoing of capital, or of a capital nature …" (original emphasis) 12 Riddell v Federal Commissioner of Taxation (2007) 68 ATR 757 at 763 [25], 766 13 Riddell v Federal Commissioner of Taxation (2007) 68 ATR 757 at 765 [39] per Crennan Bell Section 6-5(1) of the ITAA provides: "Your assessable income includes income according to ordinary concepts, which is called ordinary income." (original emphasis) "Business" is defined in s 995-1 of the ITAA as follows14: "business includes any profession, trade, employment, vocation or calling, but does not include occupation as an employee." (original emphasis) Decisions of the Federal Court The primary judge. As noted above, the primary judge decided in favour of each appellant. Her Honour found that each was carrying on a business as a professional footballer, of which playing for a club was a part, and that the management fee paid by each was incurred in gaining or producing income from that business and carrying on that business. In the light of this finding, her Honour concluded that the management fees were deductible under both limbs of s 8-1(1) of the ITAA. In Federal Commissioner of Taxation v Maddalena ("Maddalena")15, this Court concluded that Mr Maddalena, a professional part-time rugby league player, who was also a full-time employee electrician, was not able to deduct travel and legal expenses incurred by him in seeking and obtaining a new employment contract with a club to play rugby league. The Court held that the expenses were not incurred in gaining or producing income from that new employment; rather, they were "incurred in getting, not in doing, work as an employee" and therefore came "at a point too soon to be properly regarded as incurred in gaining assessable income"16. The primary judge distinguished Maddalena, on the basis that it arose in an era when the position of professional sportspersons was quite different from their position in contemporary times and otherwise on its facts. 14 This repeats the definition in s 6 of the Income Tax Assessment Act 1936 (Cth) as enacted, which has remained unamended since. 15 (1971) 45 ALJR 426; 2 ATR 541. 16 (1971) 45 ALJR 426 at 427 per Menzies J, with whom the rest of the Court agreed; 2 ATR 541 at 549. Crennan Bell Finally, following Sun Newspapers Ltd v Federal Commissioner of Taxation ("Sun Newspapers")17 and subsequent authorities18, the primary judge concluded that the management fees were revenue expenses, not capital expenses, and that s 8-1(2)(a) of the ITAA did not apply. The Full Court. The Full Court unanimously reversed the primary judge's decision, primarily by focusing on her Honour's findings of fact that the management fees were, in each case, paid for the service of negotiating an employment contract. Despite factual distinctions which the Full Court recognised, the Full Court concluded that Maddalena applied to deny deductibility in respect of the management fees. The Full Court considered that even if the appellants were carrying on businesses to the extent of their various endorsements and media appearances, detailed later in these reasons, those businesses were separate from their employment by their respective clubs. The management fees, paid for the negotiation of a new contract with the relevant club, were therefore said not to have been incurred by the appellants in gaining or producing income from their employment or carrying on their respective businesses. In the light of these conclusions, it was not necessary for the Full Court to consider s 8-1(2)(a) of the ITAA. However, the Full Court noted that, had it been necessary, it would have concluded that the management fees were not capital expenses and that s 8-1(2)(a) did not apply. Submissions in this Court In this Court, it was submitted on behalf of the appellants that each had turned his sporting prowess to account for money and that each was engaged in income-producing activity, a business, which encompassed two related streams of income: "playing income", from playing Australian Rules football or rugby league for his respective club, and "non-playing income", derived from sponsorships, endorsements and similar or related non-playing activities, whether 17 (1938) 61 CLR 337 at 363 per Dixon J; [1938] HCA 73. 18 GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 137 per Brennan, Dawson, Toohey, Gaudron and McHugh JJ; [1990] HCA 25; Federal Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 CLR 1 at 43 [147] per Crennan J; [2006] HCA 35. Crennan Bell carried out in conjunction with the club or independently of it. Thus, the management fees were said to be incurred in gaining or producing income from the appellants' businesses as professional sportsmen. Neither appellant could be fairly or completely described as having an "occupation as an employee", within the exclusion in the definition of "business" in s 995-1 of the ITAA, quoted above19. So much was said to be sufficient for deductibility under either limb of s 8-1(1) of the ITAA. The appellants argued that Maddalena was distinguishable and, if not, should be overruled. As part of the appellants' argument, there was some attempt at clarification or expansion of two conclusions of the primary judge: first, that Spriggs' 2005/2006 Contract and Riddell's 2005/2007 Contract ("the playing contracts") were contracts of employment; and secondly, that the management fees, paid under the Representation Agreement with CSM and the agreement with SFX ("the management agreements") by Spriggs and Riddell, respectively, were compensation for negotiating the playing contracts. The appellants argued that the playing contracts were not solely contracts of employment, because they contained terms and conditions upon which the appellants could turn their sporting prowess and associated celebrity to account for money from both their playing and non-playing activities. The appellants also argued that the management fees were not paid solely for negotiating the playing contracts, but for all the services provided by the managers, the successful negotiation of a playing contract being merely the trigger for payment of the management fee. Finally, in response to Notices of Contention by the Commissioner contending that the management fees were capital expenses such that s 8-1(2)(a) of the ITAA applied, the appellants argued that the management fees were not capital expenses because they were recurrent expenses referable to the process by which the appellants turned their sporting prowess to account to derive a regular stream of income. The Commissioner characterised the playing contracts as solely contracts of employment, and the management fees as fees paid for the procuring of those contracts, governed by the long-standing authority of Maddalena. The Commissioner contested the appellants' characterisations of the playing contracts and of the management fees, and further submitted that it was not open to the appellants to challenge the primary judge's conclusions on those matters, as they Crennan Bell were factual findings which were not challenged in the Full Court. The management fees were characterised by the Commissioner as "employee deductions" and therefore outside s 8-1(1)(b) of the ITAA. Finally, it was contended by the Commissioner that s 8-1(2)(a) of the ITAA operated to deny the deductions claimed because the advantage the management fees had secured were the playing contracts, which were structural assets. In resolving these competing submissions, it is necessary to consider in greater detail the income-producing activities undertaken by the appellants. The appellants' income-producing activities Spriggs. The association of players of Australian Rules football, now named AFLPA, has existed since 1974. It has been involved in the development of a Collective Bargaining Agreement between it and the AFL, containing terms and conditions incorporated into the AFL Standard Playing Contract. Thus, it has now been recognised that playing Australian Rules football in the AFL is work involving industrial relations and some need for collective bargaining. Evidence was given at trial to the effect that players in the AFL Competition are increasingly able to market and promote their own images and personalities20. The Collective Bargaining Agreement and the AFL Player Rules are consistent with this. Relevantly, cl 16 of the Collective Bargaining Agreement covers "Additional Services Agreements", which a player may enter with an AFL club or a sponsor of an AFL club as a part of the "promotions/marketing" of that player. Such agreements are required to be in writing, to "represent bona fide commercially based arrangements" and to be lodged with the AFL within 28 days of the date of signing any agreement. Schedule D of the Collective Bargaining Agreement contains guidelines for Additional Services Agreements. In addition, cl 20 of the Collective Bargaining Agreement provides that, subject to certain restrictions, a player may use his own "Image", which is defined to include "a Player's name, photograph, likeness, reputation and 20 Spriggs v Federal Commissioner of Taxation (2007) 68 ATR 740 at 747 [24] per Crennan Bell identity". Schedule E contains guidelines for licensing and expressly recognises a player's entitlement to engage in promotional activity using his Image, with permission if using AFL property or intellectual property, but otherwise independently. It can also be noted that the Collective Bargaining Agreement recognises the position of managers. The evidence was that 90% of AFL players employed The AFL Player Rules recognise that players may receive income under their AFL Standard Playing Contracts and also from other sources. Thus, the definition in the AFL Player Rules of "Football Payments" in r 1.1, which must, pursuant to r 2.2, be notified to the AFL for a player to be registered to play with a club in the AFL Competition, is as follows: "Football Payments: in respect of a Player, any payment, consideration, advantage or other benefit directly or indirectly given or provided to, or applied for the benefit of, the Player or any Associate of the Player and which:– relates in any way to, or which is connected with, the Player's past, present or future services with a Club as a football player, or any agreement, arrangement or understanding for the Player to join a Club or to refrain from joining a Club; or is so given, provided or applied by a Club, or by any Associate of a Club, unless the Player, the Club or the Associate of a Club proves to the satisfaction of the Investigations Manager that the payment, consideration, advantage or benefit was paid, given or provided to the Player, or applied for the benefit of the Player or any Associate of a Player, in consideration of bona fide: employment; (ii) marketing; or (iii) other services or rights 21 Spriggs v Federal Commissioner of Taxation (2007) 68 ATR 740 at 753 [57] per Crennan Bell not falling within sub-paragraph (a), rendered by the Player ("Additional Services")." (original emphasis) Pursuant to rr 2.1, 2.2(v) and 2.3.1, as noted above, all players with AFL clubs are obliged to enter a contract of service in a form prescribed from time to time by the AFL and the AFLPA, that is, an AFL Standard Playing Contract. However, Australian Rules football players are no longer tied to a particular club, as once they were22. There are now elaborate arrangements for transfer, exchange and participation in the AFL National Draft, which is open to players who are not listed with a club. The AFL National Draft operates on the basis that there is a pool of players, not contracted to clubs, who are available to clubs in an order determined by the previous year's results. There is also a "salary cap" mechanism designed to ensure that wealthier clubs are not able to contract disproportionate numbers of the most successful players. Both mechanisms are intended to achieve the difficult goal of evening out the competition between the clubs and to make the results less predictable23. Each of the AFL Standard Playing Contracts signed by Spriggs, including Spriggs' 2005/2006 Contract, was a tripartite agreement between Spriggs, his club and the AFL. Spriggs' 2005/2006 Contract contained terms and conditions referable to a contract of service, such as cl 4.2, by which Spriggs agreed to: "[f]aithfully, diligently and to the best of his ability, experience and talent, perform the duties applicable to employees in general and, without limiting such duties, the duties of a professional Australian Footballer as set out in this Contract." However, as noted above, the Collective Bargaining Agreement was expressly incorporated into each of the AFL Standard Playing Contracts signed by Spriggs (pursuant to cl 2) and, pursuant to cl 10.1, both Spriggs and his club agreed to be bound by the AFL Player Rules. Thus, Spriggs' 2005/2006 Contract also contained terms and conditions referable to promotional activities, including those carried out independently of his club. It was, therefore, a contract of 22 As to which, see Foschini v Victorian Football League, unreported, Supreme Court of Victoria, 15 April 1983. See also Buckley v Tutty (1971) 125 CLR 353; [1971] HCA 71. 23 Opie and Smith, "The Withering of Individualism: Professional Team Sports and Employment Law", (1992) 15 University of New South Wales Law Journal 313 at Crennan Bell employment, as the primary judge concluded, but it was not solely a contract of employment. Even if this point was not raised by the appellants in the Full Court below, as a matter concerning the legal construction of a document, it was open to the appellants to raise that construction for the first time in this Court24. As will be further explained in these reasons, the question of whether the management fees were incurred "in gaining or producing" the assessable income of Spriggs turns upon the characterisation of the tripartite arrangement between Spriggs, his club and the AFL. The answer to the question is not to be found by isolating in those arrangements a contract of employment of the player. From 2000 to 2006, Spriggs received Football Payments (as defined in the AFL Player Rules) under his AFL Standard Playing Contracts and, as a result of negotiations undertaken by CSM, he also derived income from non-playing activities. These variously included appearances at AFL and other promotions, appearances in the "Men For All Seasons Calendar", an appearance on television on the "Footy Show", and the use of his image on playing cards licensed by the AFL. During the 2005 income year, Spriggs' only income from non-playing activities was $641, from licensing fees paid to Spriggs by the AFL for the use of his image on playing cards. His total income for the 2005 income year was $106,869. All but $215, which was interest income, was described in Spriggs' income tax return for the 2005 income year as derived from being a "Professional Riddell. Save that there is no national draft, the NRL Competition is characterised by arrangements similar to the AFL Competition. Clubs operate with a salary cap and the arrangements permit transfer, exchange and selection of players. As with the AFL Competition, there was evidence at trial that a large number of players in the NRL Competition use managers' services: it was estimated that 95% of the 25 highest paid players at any NRL club are represented by a manager25. 24 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438 per Latham CJ, Williams and Fullagar JJ; [1950] HCA 35, quoting Connecticut Fire Insurance Co v Kavanagh [1892] AC 473 at 480 per Lord Watson. 25 Riddell v Federal Commissioner of Taxation (2007) 68 ATR 757 at 765 [39] per Crennan Bell The NRL Playing Contract and Remuneration Rules recognise that NRL players may receive income under their NRL Playing Contracts, from playing rugby league, and also from other sources. Thus, for the purposes of establishing, in Pt 8.1, a "Salary Cap", providing that each club must ensure that the total aggregate "Remuneration" paid to its players during a season does not exceed a particular amount, r 65 defines "Remuneration" to include benefits paid pursuant to a "Third Party Agreement". Rule 7(1) defines "Third Party Agreement" to mean "any contract, agreement or arrangement, whether entered into by a Club, a Player or some other person or entity on behalf of a Club or a Player, whereby Remuneration is paid to, or for the benefit of, a Player by a Third Party". Rule 100 provides that such Remuneration will be included for the purposes of the Salary Cap calculation, unless, among other things, the agreement was entered into between the player and the third party at arm's length from the club. One factor relevant to that assessment is "[w]hether the Player is to be promoted by the Third Party as a sportsman independent of his Club who is associated with the Third Party as opposed to a Player from his Club". Riddell's 2005/2007 Contract contains provisions referable to a contract of service, such as cl 1.1, which provides: "The relationship between the Player and the Club, as evidenced by this Agreement, is one of employee and employer, for the purposes of participating in the NRL Competition …" However, it was agreed in cl 3.1(h) that, as noted above, the NRL Playing Contract and Remuneration Rules were binding on Riddell. In addition, under cl 3.2, he was permitted to make public appearances and to contribute to press, television and radio, provided the club's consent had been obtained and no conflict of interest arose. Further, the Contract made provision for dealing with "Player Property", defined in cl 29.1 to mean "the name, photograph, likeness, reputation and identity of the Player". Pursuant to cl 3.3, Riddell licensed his Player Property to his club and, pursuant to cl 3.4, Riddell was entitled to use his Player Property for "commercial purposes including, but not limited to, endorsements, advertising, promotions, events and marketing". Thus, in addition to conditions referable to a contract of service, Riddell's 2005/2007 Contract also contained provisions covering publicity and sponsorship, including independent sponsorships. Like Spriggs' 2005/2006 Contract, Riddell's 2005/2007 Contract was a contract of employment, as found by the primary judge, but it was not solely a contract of employment. Crennan Bell As with Spriggs, the answer to the question of whether the management fees were incurred "in gaining or producing" the assessable income of Riddell is not to be found by isolating a contract of employment from the arrangements between Riddell and his club. From 1998, Riddell received payments under his NRL Playing Contracts and, as a result of negotiations undertaken by ISM and SFX, he also derived income from "sponsorship, media contracts, endorsement for goods and services, advertising or any form of promotional work". These variously included a sponsorship agreement with Puma Australia Pty Ltd, a licensing agreement with Legends Genuine Memorabilia for production of signed lithographs of Riddell, a sponsorship agreement with Microsoft Pty Ltd, an agreement with Playersinc Pty Ltd for production of a Riddell "Action Figurine", and promotional television and radio appearances. During the 2005 income year, Riddell earned $11,394 from various promotional activities negotiated by SFX on his behalf, including a television appearance and various sponsorships. He received $220,174 under his NRL Playing Contracts with St George and Parramatta. All of his income was gained or produced from his activities as a player in the NRL Competition. Deductibility under s 8-1(1)(a) of the ITAA It is against this background that the operation of s 8-1(1) of the ITAA falls to be considered. For that purpose, regard may be had to the cases decided in respect of its predecessor provisions26, which were not materially different27. The issue, in respect of s 8-1(1)(a), is whether a particular "loss or outgoing" was "incurred in gaining or producing … assessable income". There was no debate about the appellants' assessable income. It included amounts paid by their respective clubs for playing in matches; it also included promotional or 26 Section 51(1) of the Income Tax Assessment Act 1936 (Cth); s 23(1)(a) of the Income Tax Assessment Act 1922 (Cth). 27 See, eg, Federal Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 CLR 1 at 30 [90] per Crennan J; Federal Commissioner of Taxation v Day (2008) 236 CLR 163 at 175 [21] per Gummow, Hayne, Heydon and Kiefel JJ; [2008] HCA 53. Crennan Bell marketing payments for exploiting the celebrity associated with their sporting prowess. It was not disputed that these payments were income according to the concept of "ordinary income" under s 6-5 of the ITAA, that is, within "the ordinary concepts and usages of mankind"28. It was also not disputed that the management fees were "outgoings" and were "incurred". The question which was debated was whether the management fees were incurred "in gaining or producing" the appellants' assessable income. It is well settled that incurred "in" gaining or producing means incurred "in the course of" gaining or producing assessable income29. In Ronpibon Tin NL v Federal Commissioner of Taxation ("Ronpibon Tin")30, this Court explained: "it is both sufficient and necessary that the occasion of the loss or outgoing should be found in whatever is productive of the assessable income or, if none be produced, would be expected to produce assessable income." The essential question, rephrased in Federal Commissioner of Taxation v Payne ("Payne")31, is: "is the occasion of the outgoing found in whatever is productive 28 See Scott v Federal Commissioner of Taxation (1935) 35 SR (NSW) 215 at 219 per Jordan CJ, quoted in Federal Commissioner of Taxation v Stone (2005) 222 CLR 289 at 294 [8] per Gleeson CJ, Gummow, Hayne and Heydon JJ; [2005] HCA 21 ("Stone"). See also Australia, House of Representatives, Income Tax Assessment Bill 1996, Explanatory Memorandum at 40. 29 Amalgamated Zinc (De Bavay's) Ltd v Federal Commissioner of Taxation (1935) 54 CLR 295 at 303 per Latham CJ, 309 per Dixon J; [1935] HCA 81; Ronpibon Tin NL v Federal Commissioner of Taxation (1949) 78 CLR 47 at 56-57 per Latham CJ, Rich, Dixon, McTiernan and Webb JJ; [1949] HCA 15; Charles Moore & Co (WA) Pty Ltd v Federal Commissioner of Taxation (1956) 95 CLR 344 at 350 per Dixon CJ, Williams, Webb, Fullagar and Kitto JJ; [1956] HCA 77; Federal Commissioner of Taxation v Payne (2001) 202 CLR 93 at 99 [9] per Gleeson CJ, Kirby and Hayne JJ; [2001] HCA 3; Federal Commissioner of Taxation v Day (2008) 236 CLR 163 at 175 [21] per Gummow, Hayne, Heydon and Kiefel JJ, 192 30 (1949) 78 CLR 47 at 57 per Latham CJ, Rich, Dixon, McTiernan and Webb JJ. 31 (2001) 202 CLR 93 at 100 [11] per Gleeson CJ, Kirby and Hayne JJ, noted in Federal Commissioner of Taxation v Day (2008) 236 CLR 163 at 179 [30] per Gummow, Hayne, Heydon and Kiefel JJ. Crennan Bell of actual or expected income?" In Federal Commissioner of Taxation v Day32, the majority said: "That no narrow approach should be taken to the question of what is productive of a taxpayer's income is confirmed by cases which acknowledge that account should be taken of the whole of the operations of the business concerned in determining questions of deductibility." (footnote omitted) While s 8-1(1)(a) of the ITAA does not, in terms, refer to the carrying on of a "business", in considering deductibility under that provision, it may be "useful and necessary"33 to consider whether the taxpayer is carrying on a business. This is because the conduct of a business is one of the ways, according to the "ordinary concepts and usages of mankind", in which a person may earn income. Whether a particular loss or outgoing is deductible will depend on the way in which the taxpayer gains or produces their income. Where a taxpayer earns income from a business which they operate, a loss or outgoing may be incurred "in the course of" gaining or producing their income, when the same loss or outgoing would not be incurred "in the course of" gaining or producing income from service as an employee. Section 8-1(1)(a) is available both to a taxpayer who earns income as an employee and also to a taxpayer who earns income from a business carried on by the taxpayer34. If each of the appellants was engaged in the business of exploiting their sporting prowess and associated celebrity, as contended on their behalf, it becomes necessary to ask whether the management fees were incurred in the course of gaining or producing their assessable income from that business. The answer may be different from that which would apply if the appellants were not conducting businesses, but were no more than employees. 32 (2008) 236 CLR 163 at 180 [33] per Gummow, Hayne, Heydon and Kiefel JJ. 33 Stone (2005) 222 CLR 289 at 296 [16] per Gleeson CJ, Gummow, Hayne and 34 Federal Commissioner of Taxation v Green (1950) 81 CLR 313 at 319 per Latham CJ, McTiernan, Webb, Fullagar and Kitto JJ; [1950] HCA 20. Crennan Bell This distinction was recognised in Maddalena35, where Menzies J, with whom the rest of the Court agreed, said: "Had the taxpayer claimed as a deduction the expenses of changing from one job to another as an employee electrician his outlay would not have been an allowable deduction. The expenditure would have been incurred in getting, not in doing, work as an employee. It would come at a point too soon to be properly regarded as incurred in gaining assessable income. Nor would the expenditure have been an outgoing in carrying on a business. There is a difference of first importance for present purposes between an electrician who seeks work as an employee and an electrician who seeks contracts to do work as a principal. In the former case the electrician would not have a business; in the latter he would. In the latter, therefore, what he spent to obtain contracts to do electrical work would be properly regarded as an outgoing of his business. There is, however, a clear distinction between the two cases." The late Professor Parsons made the same point36: "Whether the applicability of the first limb or the second limb is in question, the inquiry must be concerned with the connection between the expense and the particular process of derivation of income." (emphasis added) The existence of a business is a matter of fact and degree. It will depend on a number of indicia, which must be considered in combination and as a whole. No one factor is necessarily determinative37. Relevant factors include, but are not limited to, the existence of a profit-making purpose, the scale of activities, the commercial character of the transactions, and whether the activities are systematic and organised, often described as whether the activities are carried out in a business-like manner38. 35 (1971) 45 ALJR 426 at 427; 2 ATR 541 at 549-550. 36 Income Taxation in Australia, (1985) at 313 [5.33]. 37 Evans v Federal Commissioner of Taxation (1989) 20 ATR 922 at 939 per Hill J. 38 See, eg, Martin v Federal Commissioner of Taxation (1953) 90 CLR 470 at 473- 474 per Webb J, 479, 481 per Williams ACJ, Kitto and Taylor JJ; [1953] HCA 100; Ferguson v Federal Commissioner of Taxation (1979) 26 ALR 307 at 311 per Bowen CJ and Franki J; Federal Commissioner of Taxation v Walker (1985) 16 (Footnote continues on next page) Crennan Bell Where it is determined that a taxpayer is conducting a business, the next question will be the "scope" of that business39. It may be that the taxpayer pursues two separate fields of endeavour, which are properly described as two separate businesses or a business and some other non-business activity. In Payne, the taxpayer conducted a deer farming business and, quite apart from that business, was employed as a pilot by an airline: the two were activities of "unrelated income derivation"40. On the other hand, a taxpayer may pursue separate income-producing activities as part of a single business41. The question is one of fact, turning upon the degree of connection and interdependence between the activities. One must consider "the whole of the operations of the ATR 331 at 334-335 per Ryan J; Evans v Federal Commissioner of Taxation (1989) 20 ATR 922 at 939-943 per Hill J. 39 See, eg, GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 138-142 per Brennan, Dawson, Toohey, Gaudron and 40 (2001) 202 CLR 93 at 101 [14] per Gleeson CJ, Kirby and Hayne JJ. See also, eg, Westfield Ltd v Commissioner of Taxation (1991) 28 FCR 333 at 343 per Hill J; Lees & Leech Pty Ltd v Commissioner of Taxation (1997) 73 FCR 136 at 147 per Hill J. See further Scales v George Thompson & Co Ltd (1927) 13 TC 83 at 88-89 41 See, eg, GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 139-140 per Brennan, Dawson, Toohey, Gaudron and McHugh JJ; Jennings Industries Ltd v Federal Commissioner of Taxation (1984) 2 FCR 273 at 281 per Bowen CJ, Woodward and Fitzgerald JJ; Commissioner of Taxation v Marshall & Brougham Pty Ltd (1987) 17 FCR 541 at 548 per Bowen CJ; Memorex Pty Ltd v Federal Commissioner of Taxation (1987) 77 ALR 299 at 310-311 per Davies and Einfeld JJ, 315 per Pincus J. See also Westpac Banking Corp v Commissioner of Stamp Duties (2003) 55 ATR 50 at 67-69 [67]- [74] per White J. See further Gloucester Railway Carriage and Wagon Co v Inland Revenue Commissioners [1925] AC 469 at 474-475 per Lord Dunedin; North Central Wagon and Finance Co Ltd v Fifield [1953] 1 WLR 610 at 613-614 per Jenkins LJ; (1953) 34 TC 59 at 69-70; Cannon Industries Ltd v Edwards (Inspector of Taxes) [1966] 1 WLR 580 at 589-590 per Pennycuick J; [1966] 1 All ER 456 at 463-464. Crennan Bell business concerned in determining questions of deductibility"42. To determine whether a taxpayer is conducting a business and the scope of that business, as said in a different context, "it is necessary to make both a wide survey and an exact scrutiny of the taxpayer's activities"43. The appellants relied on the decision of this Court in Federal Commissioner of Taxation v Stone ("Stone")44 for the proposition that their activities, including those performed under the playing contracts, constituted the conduct of a business of turning their sporting prowess to account for money. Stone concerned a professional athlete who received prizes, grants, appearance fees and cash from sponsorship. The Court concluded that the athlete's activities constituted the conduct of a business and that these various receipts constituted income of the business. The Court recognised that times had changed from the days when "[s]port was the antithesis of work"45 and when, for a well-known amateur golfer to lend his name for reward to advertise a commercial product, would be conduct unworthy of his amateur status46. Gleeson CJ, Gummow, Hayne and Heydon JJ said47: "'Professional sport' may be thought to be a phenomenon of the second half of the twentieth century. It was during that century that the 42 Federal Commissioner of Taxation v Day (2008) 236 CLR 163 at 180 [33] per Gummow, Hayne, Heydon and Kiefel JJ. See also W Nevill & Co Ltd v Federal Commissioner of Taxation (1937) 56 CLR 290 at 301 per Latham CJ; [1937] HCA 9. 43 Western Gold Mines NL v Commissioner of Taxation (WA) (1938) 59 CLR 729 at 740 per Dixon and Evatt JJ; [1938] HCA 5, quoted in Federal Commissioner of Taxation v Montgomery (1999) 198 CLR 639 at 663 [69] per Gaudron, Gummow, Kirby and Hayne JJ; [1999] HCA 34; Stone (2005) 222 CLR 289 at 297 [19] per Gleeson CJ, Gummow, Hayne and Heydon JJ. 44 (2005) 222 CLR 289. 45 Opie and Smith, "The Withering of Individualism: Professional Team Sports and Employment Law", (1992) 15 University of New South Wales Law Journal 313 at 46 Tolley v J S Fry & Sons Ltd [1931] AC 333. 47 Stone (2005) 222 CLR 289 at 295 [12]. Crennan Bell expression came to be associated with those who made their principal pursuit the playing of sport for reward." Their Honours added that the distinctions between amateur and professional status "were never tidy"48. Even in previous times, in certain contexts, courts had no difficulty in finding that playing football was work. In 1909, in Walker v The Crystal Palace Football Club Ltd49, Farwell LJ said: "It may be sport to the amateur, but to a man who is paid for it and makes his living thereby it is his work." In a similar vein, in 1971, this Court stated in Buckley v Tutty50: "The fact that football is a sport does not mean that a man paid to play football is not engaged in employment … The position of a professional footballer vis-à-vis his club is that of employer and employee". In this case, the Commissioner did not dispute that the non-playing activities from which each appellant earned income constituted a "business". However, the Commissioner contended that, following Maddalena and in the light of the exclusion of "occupation as an employee" from the definition of "business" in s 995-1 of the ITAA, it was necessary to separate the appellants' Australian Rules football and rugby league playing activities, which could be characterised as employment, from their non-playing activities. On this basis, the Commissioner argued that the management fees were not incurred in the course of earning income as employees, as they were incurred to obtain new employment contracts, as in Maddalena. Further, it was argued that they were not incurred in the course of earning income from the non-playing businesses, because they were paid to the managers solely for procuring the new employment contracts, not for any purposes of the businesses, as characterised by the Commissioner. 48 Stone (2005) 222 CLR 289 at 296 [14]. 49 [1910] 1 KB 87 at 93, a case under the Workmen's Compensation Act 1906 (UK). 50 (1971) 125 CLR 353 at 372 per Barwick CJ, McTiernan, Windeyer, Owen and Crennan Bell The Commissioner's arguments must be rejected. It is possible to obtain and perform an employment contract as part of, and during the course of, running a business, as is illustrated by Commissioner of Taxes (Vict) v Phillips51. In that case, Starke J described how the taxpayer carried on business, in partnership with his brother, as amusement managers and directors, and how, as part of that business, the taxpayer was employed as the governing director of a company which operated a theatre. Income under the employment contract was income of the business and, accordingly, agreed periodic compensation payments to the taxpayer for cancellation of the employment contract was income of the business. For that reason, half of the compensation was to be included as part of the taxpayer's assessable income. The Court concluded to being only an employee. Maddalena does not oblige the approach for which the Commissioner contended. As noted above, the Court there expressly considered that different results as to deductibility could follow if a taxpayer were conducting a business, as opposed that Mr Maddalena's contract with the rugby league club was a contract of employment and that expenses incurred in procuring that contract were not incurred in the course of earning income under that contract. In reaching that conclusion, it is plain that the Court concluded that Mr Maddalena was not conducting a business. That is not surprising, given the facts of the case: his activities as a rugby league player were part-time; there was no evidence as to any indicia of a business, a part of which was Mr Maddalena's employment; in particular, nothing in the case suggested that Mr Maddalena conducted himself in a business-like way, for instance by retaining a manager; and movement between clubs was more difficult and less structured than it is today. This explains the distinction drawn by Menzies J52: "[I]t is common knowledge that because a man is a successful professional he can earn fees from advertising and other sources which, of course, form 51 (1936) 55 CLR 144; [1936] HCA 11. See also Parsons, Income Taxation in Australia, (1985) at 141 [2.429]: "Where … the question is whether there is a business of performing services of which a contract is a revenue asset, the fact that the contract is an employment contract does not preclude a conclusion that there is a business." 52 (1971) 45 ALJR 426 at 427; 2 ATR 541 at 549. Crennan Bell part of his assessable income. Nothing I say in this judgment bears upon expenditure to earn such fees. Here it is the agreement with Newtown that the taxpayer spent money to secure." On the facts of Maddalena, there was nothing to suggest that the gaining of any such advertising and other fees were, together with employment by a club, part of a business. The definition of "business" in s 995-1 of the ITAA, set out above53, also does not require the result contended for by the Commissioner. That definition does not apply in respect of s 8-1(1)(a), where the statute calls, not for the identification of a "business" as defined, but rather for the identification of the means of gaining or producing "income"54. Moreover, the definition does not state that a contract of employment cannot form part of a business. What the definition provides is that a person will not be taken to be conducting a business merely because the person earns income under a contract of employment. Something more than that would be required for there to be a business. The facts here are quite different from those in Maddalena. As noted above, it is not disputed by the Commissioner that the appellants' non-playing activities constitute businesses. Having regard to the indicia of a business described above55, it is plain that they do. It would be artificial on the facts here to separate the stream of income from those activities, from the stream of income from the appellants' playing contracts with the clubs, as suggested by the Commissioner. The appellants' promotional activities, exploiting their celebrity, were inextricably linked to their respective employments of playing Australian Rules football and rugby league. Looking at their activities as a whole, the appellants were engaged in the business of commercially exploiting their sporting prowess and associated celebrity for a limited period. Those businesses were well established before the 54 See also Parsons, Income Taxation in Australia, (1985) at 131 [2.393]. Crennan Bell management fees were incurred56. Neither of the appellants was exclusively or simply an employee of his club. They each exploited their sporting prowess and associated celebrity with different clubs over the years during which they played in the AFL Competition and the NRL Competition, respectively. There was a synergy between playing activities and non-playing activities, each of which was an income-producing activity. The conduct of such a business by each of the appellants was anticipated in the framework provided by the playing contracts and the various other related documents described above57. That framework contained numerous provisions governing the appellants' rights to enter contracts with third parties in order to exploit their celebrity. Furthermore, each of the appellants conducted the whole of his business in a commercial and business-like way, in particular by retaining a manager. The appellants' managers had duties which included, but went well beyond, the negotiation of playing contracts. The obligations imposed by the management agreements underscore the association between the appellants' playing activities and promotional activities. Even assuming that the management fees were paid solely for the service of negotiating the playing contracts, that service and the management fees were productive of both playing income and non-playing income, each flowing from the business of each appellant of exploiting his sporting prowess and associated celebrity. There existed here sufficient connection between the outgoing, the management fees, and the gaining or producing of assessable income from the business of exploiting sporting prowess and associated celebrity, for the management fees to be deductible under s 8-1(1)(a) of the ITAA. They were incurred in the course of gaining or producing income from the appellants' respective businesses. 56 Considerations of the kind relevant to a loss or outgoing incurred near the commencement of a business therefore do not arise: cf Steele v Deputy Commissioner of Taxation (1999) 197 CLR 459; [1999] HCA 7. Crennan Bell Deductibility under s 8-1(1)(b) of the ITAA The broad application of s 8-1(1)(a) of the ITAA, including its application to income derived from a business, means that, on the facts here, s 8-1(1)(b) adds little. In Ronpibon Tin, the overlap between the limbs of the predecessor section to s 8-1(1) of the ITAA58, which often renders the second limb otiose, was noted59. It was held that a loss or outgoing will be "necessarily incurred in carrying on" a business if it is "clearly appropriate" or "adapted" for the carrying on of the business60. Restating the test another way, the loss or outgoing will be "necessarily incurred" if it is "reasonably capable of being seen as desirable or appropriate from the point of view of the pursuit of the business ends of the business"61. As noted above, the Commissioner submitted that s 8-1(1)(b) had no application, because the deductions for the management fees were "employee deductions". However, as already explained, the appellants were properly to be considered as conducting businesses of turning their sporting prowess and associated celebrity to account for money. For the reasons already explained, the businesses included repeatedly performing the services of playing for their respective clubs under the playing contracts. Section 8-1(1)(b) is capable of operating in these circumstances. No inhibition to that conclusion arises from the definition of "business" in s 995-1, set out above62, insofar as "occupation as an employee" is excluded from that definition. This is because, as already explained, that exclusion requires only that, for there to be a business, there must be something more than occupation as an employee. Here, there was. 58 Income Tax Assessment Act 1936 (Cth), s 51(1). 59 (1949) 78 CLR 47 at 56 per Latham CJ, Rich, Dixon, McTiernan and Webb JJ. 60 (1949) 78 CLR 47 at 55-56 per Latham CJ, Rich, Dixon, McTiernan and Webb JJ. 61 Magna Alloys & Research Pty Ltd v Federal Commissioner of Taxation (1980) 33 ALR 213 at 235 per Deane and Fisher JJ. See further Federal Commissioner of Taxation v Snowden & Willson Pty Ltd (1958) 99 CLR 431 at 437 per Dixon CJ, 443-444 per Fullagar J; [1958] HCA 23. Crennan Bell In the light of that conclusion, it is plain that the management fees were appropriate and adapted for the carrying on of the appellants' businesses. They were reasonably capable of being seen as desirable or appropriate, having regard to the ends of those businesses. They were necessarily incurred in carrying on those businesses and were deductible under s 8-1(1)(b) of the ITAA. Were the management fees capital expenses under s 8-1(2)(a) of the ITAA? In the light of these conclusions, it is necessary to consider whether s 8-1(2)(a) of the ITAA, in respect of outgoings of capital or of a capital nature, is engaged. As already noted, on this point, the Full Court did not doubt the conclusion of the primary judge that that provision was not engaged. The starting point is the frequently repeated statement of Dixon J in Sun "There are, I think, three matters to be considered, (a) the character of the advantage sought, and in this its lasting qualities may play a part, (b) the manner in which it is to be used, relied upon or enjoyed, and in this and under the former head recurrence may play its part, and (c) the means adopted to obtain it; that is, by providing a periodical reward or outlay to cover its use or enjoyment for periods commensurate with the payment or by making a final provision or payment so as to secure future use or enjoyment." The Commissioner contended that, in each case, the playing contract was a structural asset and that, as the management fee was paid to procure that playing contract, it was an outgoing of a capital nature. That argument of the Commissioner must be rejected, even assuming that the management fees were paid solely for the service of negotiating the playing contracts. As to the character of the advantage sought, namely the playing contracts, those contracts were revenue assets. They were not lasting assets, but were of a relatively short-term nature and subject to renewal. Each of the appellants 63 (1938) 61 CLR 337 at 363 per Dixon J. Crennan Bell entered into a number of playing contracts, with different clubs, in the course of his business. As to the other matters mentioned by Dixon J in Sun Newspapers, the management fees were a recurrent expenditure, in respect of the playing contracts, which were revenue assets. The management fees did not secure a lasting asset. They were only incurred upon successful negotiation of the playing contracts. They formed part of the remuneration to the respective managers under the management agreements. Those agreements obliged the managers to provide services in several related respects, all of which were concerned with exploiting the appellants' sporting prowess and associated celebrity on an ongoing basis. For those reasons, the management fees were not an outgoing of capital or of a capital nature and s 8-1(2)(a) of the ITAA did not apply. Conclusion The management fees paid by each of the appellants were deductible under both s 8-1(1)(a) and (b) of the ITAA, and they were revenue expenses which were not covered by s 8-1(2)(a). The orders of the primary judge should be restored. Orders The orders should be to allow the appeals to this Court, set aside the orders in paragraphs 1 and 2 of the Full Court's orders made on 22 August 2008 in each appeal to that Court and, in their place, order that the appeals to that Court be dismissed. In accordance with submissions made by the parties, there should be no order as to the costs of the appeals to this Court, and the orders of the Full Court that there be no order as to the costs of each appeal to that Court should not be disturbed.
HIGH COURT OF AUSTRALIA APPELLANT AND THE STATE OF WESTERN AUSTRALIA RESPONDENT O'Dea v Western Australia [2022] HCA 24 Date of Hearing: 4 May 2022 Date of Judgment: 10 August 2022 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 13 April 2021 and, in their place, order that: there be an extension of time within which to apply for leave to appeal; leave to appeal be granted; the appeal be allowed; the appellant's conviction be set aside; and there be a new trial. On appeal from the Supreme Court of Western Australia Representation S Vandongen SC with A O Karstaedt for the appellant (instructed by NR Barber Legal) A L Forrester SC with S D Packham for the respondent (instructed by Office of the Director of Public Prosecutions (WA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS O'Dea v Western Australia Criminal law – Parties to offence – Principal offenders – Where appellant and another charged jointly with offence of unlawfully doing grievous bodily harm with intent under s 294(1)(a) of Criminal Code (WA) – Where prosecution relied on s 7(a) of Criminal Code, which deems "[e]very person who actually does the act … which constitutes the offence" to be guilty of offence – Where uncertainty as to which act or acts of appellant or co-accused, or combination of their acts, caused grievous bodily harm – Where trial judge relevantly directed jury they could convict appellant under s 7(a) if satisfied beyond reasonable doubt that appellant and co-accused were "acting in concert, each of them doing one or more of the acts which caused" grievous bodily harm and that "[t]he relevant accused's acts were unlawful" – Whether s 7(a) permits acts of person to be attributed to another – Whether jury direction occasioned miscarriage of justice. Words and phrases – "acting in concert", "actually does the act", "attribution", "criminal responsibility", "deemed to have taken part in committing the offence", "parties to offence", "principal in the first degree", "principal offender", "unlawful common purpose". Criminal Code (WA), s 7(a). KIEFEL CJ AND The appellant and his co-accused Jacob Jefferson Webb were tried in the District Court of Western Australia before a jury on a count that each of them, with intent to maim, disfigure, disable or do some grievous bodily harm to one Alimamy Koroma, unlawfully did grievous bodily harm to Mr Koroma, contrary to s 294(1) of the Criminal Code (WA) ("the Code"). The facts relevant to that charge are set out in the reasons of Gordon, Edelman and Steward JJ. The jury returned a verdict of guilty in respect of the appellant but was unable to agree upon a verdict in respect of Mr Webb. At the trial, the prosecution sought to rely upon s 7(a) of the Code. Section 7 is entitled "Principal Offenders". In relevant part it provides: "When an offence is committed, each of the following persons is deemed to have taken part in committing the offence and to be guilty of the offence, and may be charged with actually committing it, that is to say – Every person who actually does the act or makes the omission which constitutes the offence; Every person who does or omits to do any act for the purpose of enabling or aiding another person to commit the offence; Every person who aids another person in committing the offence; (d) Any person who counsels or procures any other person to commit the offence." Section 8, which complements s 71, deals with an offence committed in the prosecution of a common purpose. The term "offence" is defined by s 2: "An act or omission which renders the person doing the act or making the omission liable to punishment is called an offence." The trial judge, Lemonis DCJ, directed the jury in connection with s 7(a). His Honour directed, with reference to a jury handout, that they must be satisfied to the requisite standard that "an offence can consist of numerous acts, which have been done by more than one person. Where two people are acting in concert, each of them doing one or more of the acts which together constitute the offence, then they are all guilty of that offence. Persons who are guilty in this way are sometimes referred to as joint principals". His Honour said that "[f]or an accused to be liable 1 R v Barlow (1997) 188 CLR 1 at 9. as a joint principal, he must do an act that forms part of the offence, which act is part of a series of acts committed with another person, while they are acting together". The summary of this pathway of reasoning ("the first pathway") in the handout to the jury contained the statement that the jury must be satisfied that the appellant and Mr Webb "were acting in concert, each of them doing one or more of the acts which caused the traumatic brain injury to be done to Mr Koroma" and that "[t]he relevant accused's acts were unlawful". The "relevant accused" was said to refer to "the accused whose case [the jury was] considering". In further directions, given when the jury sought clarification of the words "in concert", the trial judge reiterated his earlier direction and said: "[w]hat you do is you look at the totality of the acts and if it can be said that the relevant accused was acting together or in concert with the other accused". The trial judge also directed the jury in relation to the prosecution case which relied on s 7(c) ("the second pathway") but no issue regarding it arises on this appeal. It was accepted by both parties on this appeal that, as the Court of Appeal concluded, the jury must have convicted on the first pathway, which related to s 7(a). No submissions were made concerning the relevance of the second pathway to questions concerning s 7(a). In the Court of Appeal, the appellant relevantly argued that the trial judge failed to direct the jury in two respects, either of which constituted a miscarriage of justice. It was argued that the trial judge ought to have directed the jury that, for the appellant to be found liable pursuant to s 7(a), not only must his acts have been unlawful, so too must the acts of his co-accused, Mr Webb. This was necessary because there were issues at trial as to whether the prosecution had proved that each of them had not acted in defence of another2, or that they had not acted reasonably to overcome force used by Mr Koroma in resisting arrest3, or that they had not acted reasonably to prevent offences and violence4. The jury was directed to consider these issues. The trial judge was also said to have failed to direct the jury as to the meaning of the phrase "acting in concert". See s 248 of the Code. See s 231 of the Code. See s 24(1) of the Criminal Investigation Act 2006 (WA). The Court of Appeal (Buss P, Mazza and Vaughan JJA) unanimously rejected these arguments and dismissed the appeal5. Their Honours held6 that the jury was entitled to convict the appellant of the charged offence in accordance with the first pathway, even if the jury was not satisfied beyond reasonable doubt that Mr Webb's acts were unlawful. In so holding, their Honours reasoned by analogy with this Court's decision in Pickett v Western Australia7 that any statutory excuse from criminal liability that Mr Webb may have had was not an obstacle to the application of s 7(a) of the Code to the appellant. Applying Pickett, which in turn referred to the earlier decision of R v Barlow8, their Honours explained that s 7 is not concerned with the criminal responsibility of any person who is a party to the offence. It is the doing of the act by the actor which s 7 attributes to another person or persons, not the criminal responsibility of the actor9. Their Honours were also satisfied that the trial judge adequately explained what was meant by "acting in concert" in the context of s 7(a)10. The appellant's second ground of appeal to this Court, which concerns the directions given as to when persons could be said to be "acting in concert", may be disposed of shortly. Where persons do acts which together would amount to the commission of a criminal offence, but the evidence does not reveal which one of them actually did the offending act, it is not uncommon for each of them to be charged with committing the offence11. A jury can apply s 7(a) with respect to a charge of grievous bodily harm if they find two or more persons were acting together in delivering a series of blows which resulted in the grievous bodily harm12. The effect of s 7(a) is to deem each person to have committed those actions constituting the offence. 5 O'Dea v Western Australia (2021) 57 WAR 229. 6 O'Dea v Western Australia (2021) 57 WAR 229 at 256 [148]. (2020) 270 CLR 323. (1997) 188 CLR 1. 9 O'Dea v Western Australia (2021) 57 WAR 229 at 256 [147], citing Pickett v Western Australia (2020) 270 CLR 323 at 351 [66]. 10 O'Dea v Western Australia (2021) 57 WAR 229 at 254 [135]. 11 See, eg, R v Webb; Ex parte Attorney-General [1990] 2 Qd R 275 at 283. 12 Warren v The Queen [1987] WAR 314 at 328 per Franklyn J. In R v Wyles; Ex parte Attorney-General13, it was explained that at the time the Criminal Code (Qld) was enacted the criminal law had developed in a way so as to sheet home criminal responsibility by a jury being able to look at the totality of the acts where it could be inferred that persons acted in concert, "one doing the one thing and others other things, all leading to the completion of the ... offence". In cases such as this, each of the perpetrators was held to be liable as a principal and was treated as if they had actually committed the offence. It may be accepted, as McPherson JA pointed out in R v Sherrington14, that it may be preferable not to import words which have a special meaning in the common law into the Code. His Honour was speaking of the Criminal Code (Qld) but the same may be said of the Code of Western Australia. "Acting in concert" may be misunderstood to refer to a pre-arranged plan, which is an aspect of the common purpose to which s 8 refers. But in the present case, the jury could not have been confused about the meaning of that phrase in the context of s 7. They were directed that s 7(a) refers to persons "acting together". This conveyed that they should determine whether the appellant and Mr Webb were acting in combination. No question of intention or common purpose was said to arise in connection with their actions. Attention may then be directed to the first ground of appeal, which repeats the submission made to the Court of Appeal that the jury should have been directed that they must be satisfied that the acts of Mr Webb were also unlawful. The essential question is whether the characterisation of Mr Webb's actions as lawful or unlawful, which turns on the application of the relevant defences, is relevant to the enquiry under s 7(a). The question turns on the construction of that provision and its operation. It is important to bear in mind that the Code was intended to replace the common law15. Whilst it may be proper to resort to the common law as an aid to the construction of the Code, which was the course taken in Wyles16, the first duty of a court is to look to the text of the Code for an answer to a question which arises as to the meaning of its terms and its operation17. In Barlow, the majority focused [1977] Qd R 169 at 179-180 per Hoare J (Matthews J agreeing), cited in Warren v The Queen [1987] WAR 314 at 328 per Franklyn J. [2001] QCA 105 at [11]. 15 Brennan v The King (1936) 55 CLR 253 at 263. [1977] Qd R 169 at 178; see Warren v The Queen [1987] WAR 314 at 328 per 17 Stuart v The Queen (1974) 134 CLR 426 at 437. on the provisions of ss 7 and 8 in their context in the Criminal Code (Qld) and upon the guidance offered by the structure of it18. In the latter respect, it may be observed that ss 7 and 8 appear in Ch II of the Code, which concerns parties to offences, whereas ss 231 and 248 appear in Ch XXVI, which is concerned with offences involving violence to the person, justification, excuse and circumstances of aggravation. Sections 7 and 8 are concerned with the attribution of acts to a person. Sections 231 and 248 are concerned with whether a person is liable to punishment for an offence. The error in reasoning which was corrected by Barlow was the notion that ss 7 and 8 were concerned with imputing to other participants in an offence the criminal responsibility of the person who did the act or made the omission constituting the offence ("the actor")19. Barlow and Pickett held that criminal responsibility is not the concern of those provisions; rather they fasten upon the conduct of the actor. The key to the operation of ss 7 and 8, identified in Barlow, was whether the term "offence" refers to an offence as proscribed by the Code or to what an actor (there referred to as "a principal offender") has actually done or omitted to do that renders that person liable to punishment20. The majority held21 that it was the latter. In their Honours' view, s 2 of the Criminal Code (Qld), which is in relevantly the same terms as s 2 of the Code, makes it clear that "offence" is used to denote the element of conduct which, if accompanied by the prescribed circumstances, renders a person engaging in the conduct liable to punishment. In Barlow, the majority confirmed that, by the ordinary rules of construction, the term "offence", as denoting the element of conduct in an offence for which a person may be punished, must bear the same meaning in paras (b), (c) and (d) of s 7 as it does in para (a) and that there is nothing to suggest that it has any other meaning in s 822. In Pickett, the majority observed23 that s 7(a) expressly refers to "the act or ... omission which constitutes the offence" and said that "[i]t is 18 Pickett v Western Australia (2020) 270 CLR 323 at 338 [24], 347 [54] per Kiefel CJ, Bell, Keane and Gordon JJ. 19 Pickett v Western Australia (2020) 270 CLR 323 at 344 [47]. 20 R v Barlow (1997) 188 CLR 1 at 8. 21 R v Barlow (1997) 188 CLR 1 at 9 per Brennan CJ, Dawson and Toohey JJ. 22 R v Barlow (1997) 188 CLR 1 at 9. 23 Pickett v Western Australia (2020) 270 CLR 323 at 342 [41]. hardly to be supposed that the word 'offence' in the introductory words of s 7, '[w]hen an offence is committed', bears a meaning different from that spelt out in terms in s 7(a)". In Pickett, the case for the prosecution was that one member of the group who assaulted the deceased, which included Mr Pickett, inflicted the fatal stab wound. The prosecution could not establish that Mr Pickett had done so. There was a real possibility that the fatal stabbing had been done by a child under the age of 14 ("PM") who, by virtue of s 29 of the Code (which appears in Ch V of the Code, "Criminal Responsibility"), could not have been held criminally responsible unless certain matters were proved by the prosecution. It was common ground that the prosecution did not adduce evidence to establish PM's capacity beyond reasonable doubt. Nevertheless, in argument, PM was treated as the hypothetical killer. Because the person who "actually caused the death" of the deceased was a person other than Mr Pickett, s 7(a) clearly could not be relied upon. The prosecution case was that each of the other seven, including Mr Pickett, was deemed to have taken part in committing the offence by reason of s 7(b), s 7(c) or The argument that because PM might not be criminally responsible meant no offence had been committed, was held to be erroneous by the majority in Pickett25. The reasoning of the Court of Appeal in that case – that if the person who does the act is not criminally responsible for the act, the act is not one which "renders the person doing the act … liable to punishment" for the purposes of s 2 – was also rejected. The Court of Appeal in Pickett had read "offence" as if it referred to an act which of itself renders the person liable to punishment. As the majority of this Court explained26, Barlow had made clear that the definition of "offence" refers "not to the concatenation of elements and circumstances that establish liability to punishment, but to the conduct element of an offence (being an act or omission), which, if combined with other circumstances, renders the offender liable to punishment". The "act" that constituted the offence for the purposes of ss 7 and 8 was the physical act of stabbing the deceased. The stabbing constituted the conduct element of the offence of murder. It followed that an offence within the meaning of ss 7 and 8 may be committed even though the person who did the act that 24 Pickett v Western Australia (2020) 270 CLR 323 at 334-335 [14]. 25 Pickett v Western Australia (2020) 270 CLR 323 at 340-341 [37]-[38]. 26 Pickett v Western Australia (2020) 270 CLR 323 at 340-341 [37]. constitutes the offence is not criminally responsible because of the provisions of It is clear from the reasoning of the majority in Pickett that the opening words of s 7, "When an offence is committed", refer to the factual circumstances – there of death by stabbing – rather than to a conclusion that a particular person – a "principal offender" – can be said to be liable to punishment for it27. Their Honours regarded a suggestion that ss 7 and 8 can have no operation unless liability to punishment of a "principal offender" is first established as a departure from the terms of the Code. Those provisions make each person within its scope a principal offender and "[s]ection 7 is explicit in this regard"28. The majority added that whilst it may be convenient to refer to a person who "actually does an act or makes an omission" as "the principal offender", the use of "that short-hand" should not obscure the point that s 7 expressly attributes to the persons mentioned in s 7 the acts or omissions that constitute the offence. In holding that "an offence" may be committed for the purposes of ss 7 and 8, even though the person who did the act was not criminally responsible, the majority in Pickett explained29 that "[t]he personal circumstances referred to in the provisions of Ch V ... are immaterial to whether an act has been done, and so to whether an offence has been 'committed' for the purposes of ss 7 and 8". In their Honours' view, "[i]t would be inconsistent with [the majority in Barlow] to treat the possible application of the provisions of Ch V to one participant in the doing of an act that constitutes an offence as an obstacle to the operation of s 7 or s 8 of the Code in relation to others"30. The intended operation of ss 7 and 8 was made clear in the conclusions stated by their Honours in Pickett. They said that ss 7 and 8 render a person other than the actor liable to criminal punishment for those acts or omissions, subject to the personal circumstances of that other person. The circumstance that one person may have an immunity from criminal responsibility by reason of the personal circumstances referred to in Ch V does not prevent ss 7 and 8 from operating against others31. Applying the reasoning in Pickett to this case, the "offence" for the purposes of s 7(a) was each act of striking a blow to Mr Koroma by the appellant and by Mr Webb. The acts of each are attributed to the other and they both become 27 Pickett v Western Australia (2020) 270 CLR 323 at 341 [38]. 28 Pickett v Western Australia (2020) 270 CLR 323 at 342 [40]. 29 Pickett v Western Australia (2020) 270 CLR 323 at 348-349 [59]. 30 Pickett v Western Australia (2020) 270 CLR 323 at 349 [59]. 31 Pickett v Western Australia (2020) 270 CLR 323 at 351 [66]. principal offenders and liable to criminal punishment under s 294(1), subject to any defences which may arise from their personal circumstances. The fact that they may each have a defence does not prevent s 7(a) from applying. It follows that the lawfulness or otherwise of Mr Webb's actions for the purposes of Ch XXVI is not material to the application of s 7. The appellant seeks to distinguish the holding in Pickett. He contends that whereas Pickett was concerned with excuses from criminal responsibility, which arise under Ch V, this case raises questions about justifications provided for under Ch XXVI, by which an act may be regarded as lawful. The appellant relies in particular on a passage in the reasons of the majority in Pickett32 where it was said that: "If PM, as the hypothetical killer of the Deceased, had struck the lethal blow in self-defence in accordance with s 248(4), which is to be found in Ch XXVI of the Code, his assault on the Deceased would not have been unlawful. It might be said that PM's act was not the conduct element of an offence because his assault was a lawful act under s 248(4)." The majority went on to say33: "But there was no suggestion that PM acted in self-defence and so no issue arises in that regard." The observation does not form part of the reasoning of the majority on the issues which arose in Pickett. It was made in passing to make clear that no question of PM acting in self-defence arose. On further analysis, it is not consistent with the majority's reasoning as a whole, as may be seen from the application of that reasoning to the circumstances of this case. If the personal circumstances of PM in Pickett were irrelevant to the attribution of the act in question, so too must be any defence which may be raised by a particular participant. The appeal should be dismissed. 32 Pickett v Western Australia (2020) 270 CLR 323 at 343 [43]. 33 Pickett v Western Australia (2020) 270 CLR 323 at 343 [43]. Gordon EdelmanJ GORDON, EDELMAN AND STEWARD JJ. Introduction Section 7 of the Criminal Code (WA) provides that, when an offence is committed, four classes of persons will be "deemed to have taken part in committing the offence and to be guilty of the offence". Each of the four classes of persons can be charged with "actually committing" the offence. The first class, in s 7(a), is "[e]very person who actually does the act ... which constitutes the offence". The question in this appeal is whether an accused person who does not actually do the act which constitutes the offence, or who the Crown cannot prove beyond reasonable doubt actually did the act which constitutes the offence, can be "deemed ... to be guilty of the offence" under s 7(a). Over the last three decades, different intermediate appellate courts have taken different approaches to the interpretation of s 7(a) and an equivalent section in the Queensland Criminal Code. The first and narrowest approach, taken by some intermediate appellate courts, is to give the words "actually does the act" their ordinary meaning in every case. An accused person will be criminally responsible under s 7(a) only for their own acts. Sections 7(b), 7(c) and 7(d) then expand that criminal responsibility to deem the accused person to be criminally responsible for the acts of others in certain circumstances, so that the accused person may be charged with "actually committing" the acts that constitute the offence. This approach is consistent with the text of s 7(a). It is consistent with fundamental principles of criminal law that underpinned the drafting of s 7. And it respects the correctness of the unchallenged reasoning in Pickett v Western Australia34, a decision of this Court delivered only two years ago. The second approach, taken by some intermediate appellate courts, is to give the words "actually does the act" in s 7(a) their opposite meaning by attributing to the accused person the acts of another provided that the other person's acts were committed pursuant to a common intention (purpose or design) with the accused person. This approach requires the recognition of a large implication in s 7(a) that cannot be justified. That implication: contradicts the meaning of the plain text of s 7(a); is inconsistent with the drafting history of s 7 and the well-established approach at common law to which regard could be had in resolving any ambiguity in s 7(a); and is unnecessary due to the existence of a wider, express provision in s 8 concerning extended liability based on a common intention (purpose or design) with the accused person. (2020) 270 CLR 323. Gordon EdelmanJ On the third and broadest approach, reflected in the directions given by the trial judge to the jury in this case, the words "actually does the act" in s 7(a) are given their opposite meaning by attributing to the accused person the acts of another provided that the accused person and the other person were "acting in concert" (albeit not in the sense of that expression at common law) and the acts were part of "the same series of events", but without any requirement for an unlawful common purpose. This approach rewrites s 7(a) with dramatic consequences. Suppose that an accused person unexpectedly became involved in a brawl in which the accused person "actually committed" a minor act of assault upon a victim. On this broad approach, the accused person could be treated as having "actually committed" a stabbing act of murder if another person stabbed the victim during the brawl. In a circumstance where there was a much closer relationship between the accused person and the perpetrator, this Court in Pickett assumed that s 7(a) would not apply. Mr O'Dea was convicted after the trial judge erroneously directed the jury based on the third and broadest approach. The Court of Appeal of the Supreme Court of Western Australia dismissed Mr O'Dea's appeal against conviction. The appeal must be allowed, Mr O'Dea's conviction quashed, and an order made for a retrial. Sections 7 and 8 of the Criminal Code Sections 7 and 8 are contained in Ch II of the Criminal Code, entitled "Parties to offence", and provide as follows: Principal offenders When an offence is committed, each of the following persons is deemed to have taken part in committing the offence and to be guilty of the offence, and may be charged with actually committing it, that is to say – Every person who actually does the act or makes the omission which constitutes the offence; Every person who does or omits to do any act for the purpose of enabling or aiding another person to commit the offence; Every person who aids another person in committing the offence; (d) Any person who counsels or procures any other person to commit the offence. Gordon EdelmanJ In the fourth case he may be charged either with himself committing the offence or with counselling or procuring its commission. A conviction of counselling or procuring the commission of an offence entails the same consequences in all respects as a conviction of committing the offence. Any person who procures another to do or omit to do any act of such a nature that, if he had himself done the act or made the omission, the act or omission would have constituted an offence on his part, is guilty of an offence of the same kind, and is liable to the same punishment as if he had himself done the act or made the omission; and he may be charged with himself doing the act or making the omission. Offence committed in prosecution of common purpose (1) When 2 or more persons form a common intention to prosecute an unlawful purpose in conjunction with one another, and in the prosecution of such purpose an offence is committed of such a nature that its commission was a probable consequence of the prosecution of such purpose, each of them is deemed to have committed the offence. (2) A person is not deemed under subsection (1) to have committed the offence if, before the commission of the offence, the person – (a) withdrew from the prosecution of the unlawful purpose; and by words or conduct, communicated the withdrawal to each other person with whom the common intention to prosecute the unlawful purpose was formed; and having so withdrawn, took all reasonable steps to prevent the commission of the offence." The circumstances of this case The State's case against the accused men and the verdicts Mr O'Dea was charged on indictment with the offence under s 294(1)(a) of the Criminal Code of unlawfully doing grievous bodily harm to Mr Koroma with intent to maim, disfigure, disable, or to do some grievous bodily harm. Mr O'Dea was charged jointly with Mr Webb. He was tried in the District Court of Western Australia before a judge and jury. The State's case against Mr O'Dea and Mr Webb Gordon EdelmanJ relied upon ss 7(a) and 7(c) of the Criminal Code. In establishing the facts of the case, the State relied upon closed-circuit television footage from the house outside which Mr Koroma was attacked as well as from an adjacent house. The State's case was as follows. In January 2018, between 2.30 am and 2.50 am, Ms Dimer entered the Manning Bowling Club. She attempted to open a box labelled "footy tips" when she was disturbed by Mr Koroma, who worked as a cleaner at the bowling club. She fled from the premises and was pursued by Mr Koroma. After confronting Mr Koroma with a house brick, Ms Dimer continued to run along the street, with Mr Koroma in pursuit, towards a residential house that was occupied by Mr O'Dea, Mr O'Dea's partner and Mr Webb. Mr O'Dea awoke to the sound of screaming. Mr O'Dea then woke Mr Webb, who was asleep on a couch in the house, and they went outside. Mr O'Dea had armed himself with a weapon similar to a hockey stick. Ms Dimer and Mr Koroma were in the driveway of the house when Mr O'Dea came outside with Mr Webb. Mr O'Dea and Mr Webb tackled Mr Koroma and struck him, causing him to fall to the ground. When he was on the ground, Mr O'Dea and Mr Webb kicked him to the body and head. Mr Koroma sat up. Mr O'Dea kicked him to the face, causing him to fall down again. While Mr Koroma was lying on the ground, Mr O'Dea struck Mr Koroma to the head with the weapon and then hit him at least ten times in the head with his clenched fist. Mr Webb kicked Mr Koroma to the head twice. Mr O'Dea then dragged Mr Koroma onto the grass verge where he punched Mr Koroma twice more while Mr Koroma was lying on his back. Ms Dimer began to walk away but Mr O'Dea told her to return, which she did. Ms Dimer grabbed a lanyard that was around Mr Koroma's neck and started to drag his body by it. Mr Koroma recovered into a sitting position, but Mr Webb grabbed him from behind and dragged him onto a neighbour's driveway where Mr Koroma's head struck the ground. Mr O'Dea and Mr Webb circled Mr Koroma. When Mr Koroma attempted to stand, Mr O'Dea struck him on the right ankle with the weapon. Mr Koroma again fell to the ground before getting up, taking several steps, and then falling again. Mr Koroma eventually got up and walked away. The weapon used by Mr O'Dea was never found. Mr Koroma suffered a traumatic brain injury as a result of the attack. He also suffered skull and facial bone fractures, and a fractured right ankle. The traumatic brain injury amounted to grievous bodily harm. A neurosurgical registrar, Dr Rasouli, who was called by the State, gave evidence at trial that Mr Koroma's brain injury involved brain haemorrhages on the left-hand side of his head and a smaller brain haemorrhage on the right-hand side of his head. The injuries were most likely caused by blunt force trauma which could have been caused by, amongst other things, a punch to the head, slamming the head on the ground, falling hard on a surface, or being hit Gordon EdelmanJ with an object. It was possible that the injuries to the left-hand side of the brain and the injury to the right-hand side of the brain had been caused by a single punch or a fall to the ground with force. Mr O'Dea did not give evidence at trial nor did he adduce any evidence. His defence at trial, based on submissions by his counsel and an electronic record of interview with police, was that he had an honest and reasonable belief that Mr Koroma was attacking Ms Dimer. The jury returned a verdict of guilty in relation to Mr O'Dea for the offence under s 294(1)(a) of the Criminal Code of unlawfully doing grievous bodily harm with intent to disable or do grievous bodily harm. The jury were unable to agree upon a verdict in relation to Mr Webb. Mr Webb was subsequently retried and convicted of the alternative offence of unlawfully doing grievous bodily harm contrary to s 297(1) of the Criminal Code. The two pathways to conviction of Mr O'Dea In his closing address, the prosecutor submitted that although it was not possible to be certain that Mr O'Dea alone had done the act or acts that caused Mr Koroma's traumatic brain injury, the injury was more likely to have been caused by Mr O'Dea than by Mr Webb. The prosecutor argued that it was possible that the traumatic brain injury had been caused by a combination of the acts of Mr O'Dea and Mr Webb. The trial judge directed the jury, including by reference to a jury handout, that there were two pathways by which the jury might be satisfied beyond reasonable doubt that Mr O'Dea was guilty of the offence of causing grievous bodily harm with intent under s 294(1)(a) of the Criminal Code. The first pathway to conviction concerned s 7(a) of the Criminal Code. The trial judge directed the jury that they could convict Mr O'Dea if they were satisfied beyond reasonable doubt of four matters35: (i) "Mr Koroma suffered a bodily injury that amount[ed] to grievous bodily harm"; (ii) "Mr O'Dea and Mr Webb were acting in concert, each of them doing one or more of the acts which caused the traumatic brain injury to be done to Mr Koroma"; (iii) "[t]he relevant accused's acts were unlawful"; and (iv) "[i]n doing the relevant acts, the relevant accused intended to disable, or to cause grievous bodily harm to Mr Koroma". During their deliberations, the jury asked a question about the meaning of "acting in concert" in the directions of the trial judge. The trial judge answered that 35 See O'Dea v Western Australia (2021) 57 WAR 229 at 237 [41] per Buss P, Mazza and Vaughan JJA. Gordon EdelmanJ question as follows, notably omitting any requirement for Mr O'Dea and Mr Webb to have a common unlawful purpose: "For an accused to be liable as a joint principal he must do an act that forms part of the offence which act is part of a series of acts committed with another person while they are acting together. What you do is you look at the totality of the acts and if it can be said that the relevant accused was acting together or in concert with the other accused." The second pathway to conviction concerned s 7(c) of the Criminal Code. The trial judge directed the jury that they were required to be satisfied beyond reasonable doubt of seven matters before convicting Mr O'Dea36: (i) at least one of Mr O'Dea and Mr Webb did the act or acts that caused Mr Koroma's traumatic brain injury; (ii) the acts of both Mr O'Dea and Mr Webb were unlawful; (iii) both Mr O'Dea and Mr Webb intended to disable or do grievous bodily harm to Mr Koroma; (iv) Mr O'Dea knew that Mr Webb's intention was to disable or do grievous bodily harm to Mr Koroma; (v) Mr O'Dea knew that Mr Webb was assaulting Mr Koroma in such a manner as to be endangering or be likely to endanger life or to cause or be likely to cause permanent injury to health; (vi) Mr O'Dea did something with the intention of aiding or assisting in the doing of the acts done by Mr Webb; and (vii) Mr O'Dea's acts actually aided or assisted Mr Webb to commit the offence. The decision of the Court of Appeal The Court of Appeal held that a verdict of guilty based on the second pathway was not open to the jury37. The jury could not have convicted Mr O'Dea on the basis of the aiding provision in s 7(c) of the Criminal Code because the jury's failure to reach a verdict in relation to Mr Webb meant that the jury had not concluded that Mr Webb was criminally responsible for the charged offence. If Mr Webb was not criminally responsible then he had not committed an offence and Mr O'Dea could not be convicted of aiding in the commission of an offence that had not been committed. In relation to the first pathway concerning s 7(a), the Court of Appeal held that the trial judge had not erred in his directions to the jury. It was open to the jury to convict Mr O'Dea under s 7(a) by amalgamating the acts of Mr O'Dea and 36 See O'Dea v Western Australia (2021) 57 WAR 229 at 237-238 [42] per Buss P, Mazza and Vaughan JJA. 37 O'Dea v Western Australia (2021) 57 WAR 229 at 261 [184]-[186] per Buss P, Mazza and Vaughan JJA. Gordon EdelmanJ Mr Webb without having concluded that Mr Webb's acts were unlawful and without having concluded that their acts were the result of an unlawful common purpose38. It sufficed that the acts of Mr O'Dea and Mr Webb formed part of a "series of acts committed" while they were "acting in combination"39. The issue in this Court A necessary and correct consequence of the reasoning of this Court in Pickett was that the Court of Appeal properly excluded the second pathway as a possible means of conviction of Mr O'Dea. If Mr Webb was not criminally responsible because his acts – done in self-defence or defence of another – were lawful, then he had not committed an offence and Mr O'Dea could not be convicted of aiding in the commission of an offence that had not been committed. For the reasons below, the State of Western Australia was correct to accept in this Court that, to convict Mr O'Dea under s 7(c), the conduct of Mr Webb had to be unlawful. The unchallenged reasoning of the Court of Appeal on this point was impeccable. The issue in this Court concerned the reasoning of the Court of Appeal in relation to the first pathway. Mr O'Dea's first ground of appeal asserted that the Court of Appeal should have concluded that the trial judge erred by giving a direction to the jury that the criminal responsibility of Mr O'Dea could be based upon him acting in concert with Mr Webb where Mr Webb's acts were not found to be unlawful. This ground was the central focus of Mr O'Dea's appeal. Mr O'Dea's second ground of appeal concerned the conclusion of the Court of Appeal that it was sufficient for the trial judge to direct the jury that "acting in concert" meant that Mr O'Dea and Mr Webb "were acting together". This ground of appeal was premised upon the correctness of the trial judge's direction that it was necessary for the jury to conclude beyond reasonable doubt that Mr O'Dea and Mr Webb were acting in concert, in the sense of that expression at common law. For the reasons below, the Court of Appeal was correct that this premise was misconceived. 38 O'Dea v Western Australia (2021) 57 WAR 229 at 256 [147]-[149] per Buss P, Mazza and Vaughan JJA. 39 O'Dea v Western Australia (2021) 57 WAR 229 at 254 [136]-[137] per Buss P, Mazza and Vaughan JJA. Gordon EdelmanJ The background to the drafting of s 7 of the Criminal Code The Criminal Code "should be construed ... without any presumption that it was intended to do no more than restate the existing law"40. There is no such presumption because the Criminal Code was intended to replace the common law. Nevertheless, in its goal of providing a comprehensive statement of criminal liability, the Criminal Code inevitably borrowed from some common law concepts. Hence, it has been held that it is permissible to resort to the common law prior to the Criminal Code in circumstances "where the Code contains provisions of doubtful import, or uses language which had previously acquired a technical meaning"41. In each instance, the common law is considered as part of the contemporary context of the drafting of the relevant provision of the Criminal Code. In relation to ss 7 and 8, the common law prior to the Criminal Code formed an important part of the context in which the provisions were drafted: "[o]bviously s 7 ... employs words which previously had acquired a technical meaning"42. The common law, prior to the introduction of s 7, drew a distinction between principals in the first degree, whose criminal responsibility was primary, and principals in the second and third degrees, who were accessories and whose liability was derivative of, or dependent upon, a finding of criminal responsibility of another: "[o]bviously ... accessorial liability is dependent upon the commission by someone of an offence"43. As to principals in the first degree, the core instance of such criminal responsibility, as expressed in Russell's Treatise on Crimes and Misdemeanors44 three years prior to the enactment of the Queensland Criminal Code, concerned "those who have actually and with their own hands committed the [act]". Sir James Fitzjames Stephen described principals in the first degree as "those who actually 40 Brennan v The King (1936) 55 CLR 253 at 263 per Dixon and Evatt JJ, quoted in Pickett v Western Australia (2020) 270 CLR 323 at 337 [22] per Kiefel CJ, Bell, 41 Stuart v The Queen (1974) 134 CLR 426 at 437 per Gibbs J, quoted in Pickett v Western Australia (2020) 270 CLR 323 at 337 [23] per Kiefel CJ, Bell, Keane and 42 Gillies, The Law of Criminal Complicity (1980) at 28. 43 Gillies, The Law of Criminal Complicity (1980) at 5. 44 Russell, A Treatise on Crimes and Misdemeanors, 6th ed (1896), vol 1 at 161 (emphasis in original). Gordon EdelmanJ committed the offence"45. As Sir Courtney Kenny said, a principal in the first degree is "[a]lmost always ... the [person] by whom this act itself was done"46. There was one exceptional circumstance where a person could be a principal in the first degree without actually performing the act that constituted the actus reus of the offence. That circumstance was where the person acted through an agent47. Where a principal acted through an agent, the acts of the agent were attributed to the principal and the liability of the principal was primary, not derivative48. An example of where the common law treated a person as a principal in the first degree by agency was where the acts of another were part of a joint enterprise49. Sometimes it was said that a person could be a principal in the first degree based on a fiction of "innocent agency". For instance, a person who prepared a poisoned drink to be given by an innocent person to the victim was sometimes said to be a principal who acted through an innocent agent50. But the better view is that no agency and no attribution are involved. The person who prepared the poisoned drink is criminally responsible for their own act which caused the death, even if the drink was served by a different person51: it is "natural to say that the defendant had caused the death"52. 45 Stephen, A General View of the Criminal Law of England, 2nd ed (1890) at 82. 46 Kenny, Outlines of Criminal Law, 5th ed (1913) at 84. 47 See, eg, IL v The Queen (2017) 262 CLR 268 at 284 [32] per Kiefel CJ, Keane and Edelman JJ, quoting White v Ridley (1978) 140 CLR 342 at 346 per Gibbs J. 48 Northern Land Council v Quall (2020) 94 ALJR 904 at 920-921 [82] per Nettle and Edelman JJ; 383 ALR 378 at 398-399. 49 See McAuliffe v The Queen (1995) 183 CLR 108 at 114 per Brennan CJ, Deane, Dawson, Toohey and Gummow JJ; Osland v The Queen (1998) 197 CLR 316 at 342-343 [72] per McHugh J; Pickett v Western Australia (2020) 270 CLR 323 at 363-364 [95] per Nettle J. 50 R v Michael (1840) 9 Car & P 356 [173 ER 867]; cf R v Lowe (1850) 3 Car & K 123 51 Jenks (ed), Mr Serjeant Stephen's New Commentaries on the Laws of England, 14th ed (1903), vol 4 at 30-31. 52 Smith, A Modern Treatise on the Law of Criminal Complicity (1991) at 105. Gordon EdelmanJ There was a fine distinction drawn between principals in the second degree and principals in the third degree. A principal in the second degree was a person who was present at the scene of a crime and encouraged the perpetrator but did not physically participate. The liability of a principal in the second degree was derivative of, or dependent upon, the criminal responsibility of the person who had been encouraged53. A principal in the third degree, or "accessory before the fact", was a person who aided and abetted in the commission of the crime, but who was not present at the scene of the crime. Again, the liability of the accessory before the fact was derivative of, or dependent upon, the criminal responsibility of the person who was aided and abetted54. the In 1877, Sir James Fitzjames Stephen was authorised by Lord Chancellor and the Attorney-General to prepare a draft Penal Code55. The draft Penal Code which he prepared was based upon his earlier Digest56. Although introduced to the House of Commons, it was never enacted into law: it was the "closest England came to achieving a codified criminal law" and served as a model for numerous jurisdictions, including Queensland and Western Australia57. Section 71 of his draft Penal Code58 provided as follows: 53 Osland v The Queen (1998) 197 CLR 316 at 341-342 [71] per McHugh J, citing R v Kupferberg (1918) 13 Cr App R 166 and R v Clarkson [1971] 1 WLR 1402; [1971] 3 All ER 344. 54 Osland v The Queen (1998) 197 CLR 316 at 341-342 [71] per McHugh J, citing R v Higgins (1801) 2 East 5 at 19 [102 ER 269 at 274-275], R v See Lun (1932) 32 SR (NSW) 363 at 364, Howell v Doyle [1952] VLR 128 at 133 and Jackson v Horne (1965) 114 CLR 82 at 94. 55 Darkan v The Queen (2006) 227 CLR 373 at 385 [33] per Gleeson CJ, Gummow, 56 Stephen, A Digest of the Criminal Law (Crimes and Punishments) (1877). 57 Kadish, "The model penal code's historical antecedents" (1988) 19 Rutgers Law Journal 521 at 531, 533-534. 58 That became s 72 of the Criminal Code Bill 1880, which was not enacted following criticism by Cockburn CJ and a change in government: Darkan v The Queen (2006) 227 CLR 373 at 386 [36] per Gleeson CJ, Gummow, Heydon and Crennan JJ. Gordon EdelmanJ "Parties to Offences Every one is a party to and guilty of an indictable offence who (a) Actually commits the offence or does or omits any act the doing or omission of which forms part of the offence; or (b) Aids or abets any person in the actual commission of the offence, or in any such act or omission as aforesaid; or (c) Directly or indirectly counsels or procures any person to commit the offence, or to do or omit any such act as aforesaid. If several persons form a common intention to prosecute any unlawful purpose, and to assist each other therein, each of them is a party to every offence committed by any one of them in the prosecution of such common purpose, the commission of which offence was or ought to have been known to be a probable consequence of the prosecution of such common purpose." Section 7(a) of the Criminal Code, and its equivalent in the Queensland Criminal Code, were closely modelled upon the opening words of s 71(a) of the draft Penal Code and use nearly identical wording to the common description of the core instance of a principal in the first degree. However, and significantly, s 7(a) does not include the balance of s 71(a) with its reference to a person who does or omits "any act the doing or omission of which forms part of the offence" (emphasis added). In addition, the expanded instance of agency by common intention or common purpose was treated separately in the final paragraph. As this Court observed in Darkan v The Queen59, and as Sir Samuel Griffith remarked in a marginal note to his Draft Code, the final paragraph of s 71 was adapted by Sir Samuel Griffith in his redrafting of s 8 of the Queensland Criminal Code, from which s 8(1) of the Criminal Code was copied. Sections 7(b), 7(c) and 7(d) of the Criminal Code were adapted from ss 71(b) and 71(c). In his marginal note to s 71, Sir James Fitzjames Stephen observed that the section was "framed as to put an end to the nice distinctions between accessories before the fact [principals in the third degree], and principals, in the second degree"60. The plain words of ss 71(b) and 71(c), like those of ss 7(b), (2006) 227 CLR 373 at 386-387 [36]-[39] per Gleeson CJ, Gummow, Heydon and 60 United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences (1879) [C 2345] at 76. Gordon EdelmanJ 7(c) and 7(d) of the Criminal Code, erased the fine distinctions between principals in the second degree and principals in the third degree. Sections 7(b), 7(c) and 7(d) of the Criminal Code The textual requirement for commission of an offence Although it has sometimes been said in Western Australia that ss 7(b), 7(c) and 7(d) of the Criminal Code followed the common law in being concerned with derivative liability61, the common law concepts of derivative liability were not precisely transplanted. As Kennedy J said in Warren v The Queen62, it is not "helpful to proceed on any a priori basis that the liability of the aider or accessory is merely derivative from that of the primary offender". As the decision in Pickett shows, one reason that it is not helpful is that the blunt application of a concept of derivative liability does not distinguish between the acts of another which make that person liable to punishment subject to excuses, and the acts of another which make that person criminally responsible. Nevertheless, there remained in s 7 the important requirement of the commission of an offence either by the principal offender (s 7(a)) or by other persons (ss 7(b), 7(c) and 7(d)). The opening words of s 7 are: "When an offence is committed". Section 2 defines an "offence" as "[a]n act or omission which renders the person doing the act or making the omission liable to punishment". By their terms, ss 7(b), 7(c) and 7(d) therefore all require that another person has done an act that renders that person liable to punishment, subject to excuses. Section 7(a) requires that the accused person "actually does the act" which constitutes the offence. The decision in Pickett In Pickett, Mr Slater died as a result of a stab wound to his chest which was inflicted during an attack by a group of eight male persons that included the five appellants. The person who "actually" inflicted the stab wound that caused Mr Slater's death was either Mr Pickett or a juvenile, PM. PM was not proved by the prosecution to have had the capacity to know that he ought not to do the act. Hence, PM was excused from criminal responsibility under s 29 of the Criminal Code. The question before this Court was whether the appellants, including 61 See, eg, Campbell v Western Australia (2016) 50 WAR 331 at 341 [21] per McLure P; Birdsall v Western Australia (2019) 54 WAR 418 at 434 [62], 437 [84]-[85], 452-453 [179] per Buss P and Mazza JA. [1987] WAR 314 at 324. Gordon EdelmanJ Mr Pickett, could be criminally responsible under s 7(b), s 7(c) or s 8 of the Criminal Code, even though the person who may have actually inflicted the stab wound was not criminally responsible. This Court unanimously held that, despite PM's lack of criminal responsibility, the appellants were capable of being criminally responsible under s 7(b), s 7(c) or s 8 of the Criminal Code. In respect of s 7, there were several important steps to the reasoning of Kiefel CJ, Bell, Keane and Gordon JJ: The reference to an "offence" in s 7 is to "the conduct element of an offence (being an act or omission)"63. Sections 7(b), 7(c) and 7(d) are not concerned with attributing the criminal responsibility of one participant to other participants64. In other words, a participant can be criminally responsible under s 7(b), s 7(c) or s 7(d) even if the provisions in Ch V in Pt I of the Criminal Code excuse from criminal responsibility "the person who did the act or made the omission that constituted the offence"65. Sections 7(b), 7(c), 7(d) and 8 still require that the act or omission of another constitute the conduct element of an offence that is committed. It is one thing to say that "PM was not criminally responsible" under Ch V "[b]ut it is another thing to say that it follows that no offence was committed by him"66. For instance, if "PM, as the hypothetical killer ... had struck the lethal blow in self-defence ... his assault ... would not have been unlawful. It might be said that PM's act was not the conduct element of an offence because his assault was a lawful act"67. (2020) 270 CLR 323 at 341 [37]. See also at 342 [40], 343 [44], 345-348 [51]-[56]. See further R v Barlow (1997) 188 CLR 1 at 9 per Brennan CJ, Dawson and (2020) 270 CLR 323 at 342 [41], 344 [47], 352 [67]. (2020) 270 CLR 323 at 348 [58]. (2020) 270 CLR 323 at 341 [38]. See also at 348-349 [59]-[60]. (2020) 270 CLR 323 at 343 [43]. Gordon EdelmanJ The only exception in s 7 where the relevant act does not need to be the constituent element of an offence is the final paragraph of s 768. The relevant act that was the "conduct element of the offence of murder" was the act of stabbing69. The lack of proof beyond reasonable doubt that PM had capacity did not mean "that no offence had been committed" but meant only "that PM was not liable to punishment for the act that constituted the offence"70. This summary demonstrates the centrality to the reasons of Kiefel CJ, Bell, Keane and Gordon JJ of the requirement for liability of a participant under s 7(b), s 7(c) or s 7(d) that there be an offence committed by the other person. This was why their Honours focused upon the difference between an excuse under Ch V of the Criminal Code (which renders a person not criminally responsible for an offence) and a justification (which has the effect that a person's acts were lawful such that no offence was committed)71. As Nettle J explained in his Honour's separate reasons, the "distinction between justifications and excuses has long been significant to the common law of crimes against the person"72. After setting out that long-established significance in detail73, his Honour explained that, since self-defence is a justification which makes the act lawful74: "a person who aids another to wound in self-defence, or who is a participant in a joint criminal enterprise in the course of which another participant wounds a third person in self-defence, may be entitled to plead that his or her actions in aiding the other person to wound or participating in the joint criminal enterprise that resulted in the wounding were, to that extent, not unlawful, and hence that he or she is not criminally liable for the wounding". (2020) 270 CLR 323 at 351 [65]. (2020) 270 CLR 323 at 348 [57]. (2020) 270 CLR 323 at 350 [62]. (2020) 270 CLR 323 at 343 [43]. (2020) 270 CLR 323 at 364 [98]. (2020) 270 CLR 323 at 364-367 [98]-[103]. (2020) 270 CLR 323 at 366-367 [103]. Gordon EdelmanJ This principle in Pickett was not novel. As Nettle J observed in Pickett75, the plurality of Brennan CJ, Dawson and Toohey JJ in R v Barlow had said that in ss 7 and 8 the reference to an "offence" was used "to denote the element of conduct … which, if accompanied by prescribed circumstances, or if causing a prescribed result or if engaged in with a prescribed state of mind, renders a person engaging in the conduct liable to punishment". And in Jackson v Horne76, this Court held that criminal responsibility of a person who procures the commission of an offence by another person, under the provision of the Queensland Criminal Code equivalent to s 7(d) of the Criminal Code, required the other person to have committed an offence. Indeed, it would have been astonishing to extend criminal liability to a person who aided another in the commission of a lawful act, thus creating "a kind of ghost crime committed by the actor which is sufficient to inculpate the [accused person]"77. The operation of s 7(a) of the Criminal Code The proper approach to s 7(a) In R v Melling78, Holmes JA (with whom McMurdo P and Applegarth J agreed) correctly reasoned, in an appeal concerning the criminal responsibility of two accused persons for grievous bodily harm, that "for the Crown to succeed in establishing criminal responsibility on the part of both appellants under s 7(1)(a), it was necessary that against each there be proved an act causing injuries amounting to grievous bodily harm, as well as the necessary intent". In other words, the act "causing" the grievous bodily harm must be the "actual" and not the attributed act of the accused person. In the words of s 7(a), the act that constitutes the offence of grievous bodily harm must be one that the person "actually does". This approach is consistent with the text and drafting history of s 7(a), including the incorporation of a requirement in s 7 for the commission of an offence, either by the actual acts of the accused person (s 7(a)) or by the acts of others (ss 7(b), 7(c) and 7(d)). It does not require the recognition of any contrived (2020) 270 CLR 323 at 369 [109], quoting R v Barlow (1997) 188 CLR 1 at 9 per Brennan CJ, Dawson and Toohey JJ (emphasis of Nettle J). (1965) 114 CLR 82 at 88 per Barwick CJ, 94 per Taylor J, 95 per Menzies J. 77 Glanville Williams, "Secondary Parties to Non-Existent Crime" (1953) 16 Modern Law Review 384 at 385. [2010] QCA 307 at [25] (concerning the equivalent provision to s 7(a) in the Criminal Code (Qld)). Gordon EdelmanJ or fictitious implication in s 7(a). And it respects the correctness of the unchallenged reasoning in Pickett. The clearest instance in which s 7(a) will apply, using the example of a fatal stabbing, is where the accused person's actual act is proved to have been the only act that caused the victim's death. It will also apply, in the same manner, where the death is the result of the acts of two or more people acting independently, and where the acts of each person were sufficient to cause the death. Thus, if the accused person and another person both fatally stab a victim without any underlying common purpose or joint criminal enterprise and the victim dies, it is not open to either the accused person or the other person to deny criminal responsibility for their acts on the basis that, but for their acts, the death would have resulted from the acts of the other individual. The second approach – attribution of acts in a series on the basis of joint criminal enterprise As noted above, some intermediate appellate courts have held that s 7(a) contains an implication that the acts of another person can be attributed to a person, and treated as "actually" having been committed by the person, where the person acts "in concert" with the other person in the sense of that expression at common law79 (or, to use expressions that amount to the same thing, with a "common purpose" or with a "common design"80). The premise of Mr O'Dea's second ground of appeal was that this approach was correct. On this approach, Mr O'Dea argued, the trial judge erred because he did not properly direct the jury as to the requirement of an unlawful common purpose between Mr O'Dea and Mr Webb. This premise should not, however, be accepted. The implication that must be recognised on this approach is contrary to the text and context of s 7(a). In Campbell v Western Australia81, McLure P redrafted s 7(a) so as to include such a fictitious implication that extended the operation of 79 See, eg, R v Wyles; Ex parte Attorney-General [1977] Qd R 169 at 174 per Lucas J; R v Webb; Ex parte Attorney-General [1990] 2 Qd R 275 at 283 per Macrossan CJ. 80 See McAuliffe v The Queen (1995) 183 CLR 108 at 114 per Brennan CJ, Deane, Dawson, Toohey and Gummow JJ; Gillard v The Queen (2003) 219 CLR 1 at 35 [109] per Hayne J; Likiardopoulos v The Queen (2012) 247 CLR 265 at 273 [19] per Gummow, Hayne, Crennan, Kiefel and Bell JJ. (2016) 50 WAR 331 at 341 [22]. Gordon EdelmanJ the paragraph to include acts that were not actually done by the person but were done by another person for whom the person was "liable at common law". In R v Sherrington82, in a passage quoted by the Court of Appeal in this case83, McPherson JA (with whom Wilson J agreed) correctly characterised such reasoning as "a form of heresy". The implication based on common law would so overwhelm the meaning of s 7(a) that it would be possible for a person to be criminally responsible under s 7(a) even if the person had not done any actual acts at all. As the Court of Appeal of the Supreme Court of Western Australia correctly observed in L v Western Australia84, in the course of rejecting any implication of a common law principle of common purpose in s 7 of the Criminal Code, the common law principle permitted the attribution of acts of another person to an accused person acting in concert for an unlawful purpose, even if the accused person had not "actually" done any act at all. The recognition of an implication of a common law requirement of "acting in concert" in s 7(a) is also precluded by the history and context of s 7(a), which includes the express requirement of a common purpose in s 8. As explained above, s 8 was a modified version of Sir James Fitzjames Stephen's provision for criminal responsibility based upon agency where persons satisfy requirements including having formed a common intention to prosecute an unlawful purpose in conjunction with one another. Section 8 thus operates in the circumstance, incorrectly contemplated by Lucas J as falling within s 7(a) in R v Wyles; Ex parte Attorney-General85, where "A B and C form a plan to burgle a house, in pursuance of which A breaks into the house but does not enter, B takes no part in the breaking but enters and steals, and C keeps watch in the street outside". [2001] QCA 105 at [11]. 83 O'Dea v Western Australia (2021) 57 WAR 229 at 248 [100] per Buss P, Mazza and Vaughan JJA. (2016) 49 WAR 545 at 548 [5], 553 [33], 554 [41] per Martin CJ, Mazza JA and Mitchell J. See also Whitby v Western Australia [2019] WASCA 11 at [191] per [1977] Qd R 169 at 174. See also Osland v The Queen (1998) 197 CLR 316 at 342-351 [72]-[95] per McHugh J. Gordon EdelmanJ The broadest approach to s 7(a) The broadest approach to s 7(a), adopted by the trial judge in this case, is to eschew the requirement for the commission of any offence by either the accused person or another person. Instead, the acts of the other person are attributed to the accused person by a novel principle unknown to the civil or criminal law of agency. That novel principle would permit attribution to an accused person (here, Mr O'Dea) of the acts of another (here, Mr Webb) if the acts form part of a series of acts committed "in combination" with the other person. No attempt was made to justify the attribution of acts to Mr O'Dea on such a novel basis. Apart from the unjustified novel approach to attribution, a further problem with this approach is that it is contrary to the textual meaning of "actually does the act" in s 7(a) and the plain meaning of those words in light of the drafting history of s 7(a). As explained above, the language of s 7(a) preserved, in almost identical terms, the core instance of a principal in the first degree as expressed by Sir James Fitzjames Stephen in the opening words of s 71(a) of his draft Penal Code86. That meaning imposed criminal responsibility upon the accused person only for their actual acts, not acts that were attributed to them. Moreover, and as already pointed out, s 7(a) does not contain the additional language of s 71(a) of the draft Penal Code, with its reference to the doing of an act or omission which "forms part of the offence". A further problem with this approach is the inconsistency with the remainder of s 7 in imposing criminal responsibility based in part upon the lawful acts of others. As explained above, one premise of the decision in Pickett was that an accused person could not be criminally responsible for the lawful acts of others under s 7(b), s 7(c) or s 7(d). An offence must be committed by the other person. The opening words of s 7, "When an offence is committed", do not merely govern ss 7(b), 7(c) and 7(d). They also govern s 7(a). If this broad approach were correct, then Mr Pickett could have been made criminally responsible under s 7(a). It would not have mattered whether the person who "actually" inflicted the stab wound that caused Mr Slater's death was PM rather than Mr Pickett. In other words, if the stab wound had been inflicted by PM, it would have been possible on this approach for Mr Pickett to be criminally responsible under s 7(a) by the attribution to him of PM's acts that were committed as part of a series with the acts of Mr Pickett, and while PM and Mr Pickett were acting in combination. Such an approach was emphatically rejected by this Court. As Kiefel CJ, Bell, Keane and Gordon JJ said, the person who actually inflicted 86 United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences (1879) [C 2345] at 76. Gordon EdelmanJ the stab wound, "and only that person, actually caused the death of the Deceased for the purposes of s 7(a) of the Code"87. Application of s 7(a) to this case and conclusion In Whitby v Western Australia88, Buss P and Mazza JA observed that a "remarkable feature of the State's case at the trial was the prosecutor's reliance solely upon s 7(a) of the [Criminal Code]". Equally, in this case, a remarkable feature of the State's case against Mr O'Dea and Mr Webb was that the State made no attempt to allege that, at any point during the assaults on Mr Koroma, Mr O'Dea and Mr Webb tacitly formed an unlawful common purpose of doing grievous bodily harm to Mr Koroma, which extended beyond a reasonable response to the circumstances that they believed to exist89. Instead, the State sought to attribute the acts of Mr O'Dea or Mr Webb to each other by a novel doctrine of agency that cannot be justified by the text or context of s 7(a) and has never been justified as a matter of principle. The acceptance by the Court of Appeal of the broadest approach to s 7(a), which was the basis of the trial judge's direction to the jury as to the first pathway, was an error. Rather, and in light of the acceptance by the prosecutor in closing that it was possible that the grievous bodily harm had been caused by a combination of the acts of Mr O'Dea and Mr Webb, the proper legal meaning of s 7(a) in its application to Mr O'Dea required a direction to the jury as follows. The jury could convict Mr O'Dea if they were satisfied beyond reasonable doubt that: (i) Mr Koroma's traumatic brain injury was grievous bodily harm; (ii) Mr O'Dea's acts, by themselves, were sufficient to have caused Mr Koroma's traumatic brain injury; and (iii) Mr O'Dea's acts that were sufficient to cause Mr Koroma's traumatic brain injury were not undertaken in self-defence or as a result of an honest and reasonable mistake. The Court of Appeal should have found that the trial judge erred in his direction to the jury that Mr O'Dea could be convicted under the first pathway based upon a combination of the acts of Mr O'Dea and Mr Webb acting "in concert". That direction was an error of law amounting to a miscarriage of justice. The appeal should be allowed on the first ground of appeal. It is, therefore, strictly unnecessary to address Mr O'Dea's second ground of appeal, although it should be 87 Pickett v Western Australia (2020) 270 CLR 323 at 334-335 [14], referring to Birdsall v Western Australia (2019) 54 WAR 418 at 430 [31]. [2019] WASCA 11 at [119]. 89 Criminal Code, s 248(4)(b). Gordon EdelmanJ apparent from these reasons that the second ground was based upon a misconceived premise. There was no requirement for the trial judge to explain to the jury the meaning of "acting in concert" in relation to s 7(a). The concept of "acting in concert" is not contained in s 7(a) and it should not form part of any direction concerning that section. Orders should be made as follows: (1) Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 13 April 2021 and, in their place, order that: there be an extension of time within which to apply for leave to appeal; leave to appeal be granted; the appeal be allowed; the appellant's conviction be set aside; and there be a new trial.
HIGH COURT OF AUSTRALIA Matter No S356/2006 AND APPELLANT MEMBERS OF THE COMPANIES AUDITORS AND LIQUIDATORS DISCIPLINARY BOARD & ANOR RESPONDENTS Matter No S361/2006 APPELLANT AND RESPONDENTS Albarran v Members of the Companies Auditors and Liquidators Disciplinary Board Gould v Magarey [2007] HCA 23 24 May 2007 S356/2006 & S361/2006 ORDER In each matter, the appeal is dismissed. On appeal from the Federal Court of Australia Representation N Perram SC with A D Crossland for the appellant in Matter No S356/2006 (instructed by NOT Lawyers) B W Walker SC with P J Brereton and P Kulevski for the appellant in Matter No S361/2006 (instructed by Henry Davis York) Submitting appearances for the first and second respondents in both matters Intervener H C Burmester QC with K L Eastman intervening on behalf of the Attorney- General of the Commonwealth in both matters (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Albarran v Members of the Companies Auditors and Liquidators Disciplinary Board Gould v Magarey Constitutional law (Cth) – Separation of powers – Judicial power – On the application of the Australian Securities and Investments Commission, the Companies Auditors and Liquidators Disciplinary Board ("the Board") suspended the registration of the appellants as liquidators pursuant to s 1292 of the Corporations Act 2001 (Cth) – Whether s 1292 of the Corporations Act 2001 (Cth) invalidly confers the judicial power of the Commonwealth upon the Board. Constitutional law (Cth) – Judicial power – Meaning of judicial power – Whether disciplinary proceedings involve the exercise of judicial power – Whether the determination of wrongdoing or impropriety involves the exercise of judicial power – Whether the capacity to affect the appellants' "status" as registered liquidators involves the exercise of judicial power. Insolvency – Liquidators – Suspension of registration as liquidator – Role and function of the Board – Whether the functions performed by the Board involved the ascertainment or enforcement of an "existing right or liability" – Whether the function performed by the Board involved the imposition of punishment – Relevance of the composition and membership of the Board – Relevance of the exercise of evaluative or discretionary power – Relevance of historical considerations – Relevance of chameleon principle – Whether the Board exercised judicial power. Insolvency – Liquidators – Suspension of registration as liquidator – Meaning of "adequately and properly" and "fit and proper" in s 1292(2) of the Corporations Act 2001 (Cth). Words and phrases – "adequately and properly", "chameleon principle", "disciplinary", "existing right or liability", "fit and proper", "functional analysis", "judicial power of the Commonwealth", "punishment", "registered liquidator", "separation of powers". Constitution, Ch III. Australian Securities and Investments Commission Act 2001 (Cth), ss 203, 204. Corporations Act 2001 (Cth), Pts 9.2, 9.6A; ss 448B, 532(1), 1292. GLEESON CJ, GUMMOW, HAYNE, CALLINAN, HEYDON AND CRENNAN JJ. These appeals from the Full Court of the Federal Court of Australia (Emmett, Allsop and Graham JJ)1 were heard together, as the two proceedings had been in the Full Court. The one set of reasons for judgment was delivered by the Full Court. The first respondent in each appeal comprises members of the Companies Auditors and Liquidators Disciplinary Board ("the Board"). That body is continued in existence by s 261 of the Australian Securities and Investments Commission Act 2001 (Cth) ("the ASIC Act") and consists of a membership provided for in s 203. The effect of s 204 of the ASIC Act is that the Board has the functions and powers conferred on it by the ASIC Act and the Corporations Act 2001 (Cth) ("the Corporations Act"). The Australian Securities and Investments Commission ("ASIC") is the second respondent in each appeal. Both the Board and ASIC entered submitting appearances. The active opposition to the appeals was provided by the Attorney- General of the Commonwealth as intervener. The registration of liquidators Part 9.2 (ss 1276-1298) of Ch 9 of the Corporations Act is headed "Registration of auditors and liquidators". Prohibitions are imposed by s 532(1) and s 448B of the Corporations Act respectively upon persons acting as a liquidator, or as administrator of a company or deed of company arrangement. These prohibitions are backed by the offence provision in s 1311(1) and in Pt 9.6A provision is made2 for the vesting of federal jurisdiction in respect of criminal matters arising under the Corporations Act. A registered liquidator is relieved from the effect of the prohibitions imposed by s 532(1) and s 448B, but suspension or cancellation of registration by the Board reactivates those prohibitions. However, enforcement of a suspension or cancellation order made by the Board requires the exercise by a court of jurisdiction provided for in Pt 9.6A of the Corporations Act. 1 Albarran v Members of Companies Auditors and Liquidators Disciplinary Board (2006) 151 FCR 466. 2 By Div 2 (ss 1338A-1338C). See generally Gordon v Tolcher (2006) 81 ALJR 507 at 509 [10], 511-512 [29]-[33]; 231 ALR 582 at 584, 587-588. Crennan Section 1292 of the Corporations Act confers certain powers and functions on the Board. In particular, it is s 1292(2) which provides that, in the stipulated circumstances, the Board may by order cancel or suspend for a specified period the registration of a person as a liquidator. From decisions of the Board applications may be made under s 1317B for review by the Administrative Appeals Tribunal3. Thus, not only does the Board lack the power to enforce its decisions4, they are not conclusive in the sense used in authorities such as Attorney-General (Cth) v Breckler5 and Luton v Lessels6. Nor, as will appear, does the Board settle disputes about existing rights and duties. Nevertheless, the appeals challenge the holding by the Federal Court that the power conferred on the Board by s 1292(2) does not involve the exercise of the judicial power of the Commonwealth and that s 1292(2) is not an ineffective attempt by the Parliament to confer such power on a body other than one of the courts identified in Ch III of the Constitution. In a limited sense, it may be said that the exercise by the Board of its powers under s 1292(2) of cancellation and suspension affects the "status" of registered liquidators. But the invocation of that term does not necessarily lead to any particular answer to the questions of constitutional law raised in these appeals. In particular, and for reasons to be developed below, the Board does not adjudicate guilt or inflict punishment when acting under s 1292(2). It should be noted immediately that the citation by the appellants of Rich v Australian Securities and Investments Commission7 does not assist them. That case concerned a different field of discourse, namely, the application of the body of law concerning privileges against penalties and forfeitures to court 3 See Fletcher v Commissioner of Taxation (1988) 19 FCR 442 at 451-453. 4 See Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR (1999) 197 CLR 83 at 111-112 [46]-[47]. (2002) 210 CLR 333 at 346 [24], 360 [76], 374-375 [127]-[128]. (2004) 220 CLR 129 at 145 [32]. Crennan proceedings under ss 206C and 206E of the Corporations Act for disqualification of directors, in the course of which the directors were ordered to give discovery of documents. The facts Something now should be said respecting the facts. Mr Vanda Russell Gould has been registered as a liquidator under the Corporations Act and its predecessors since 7 January 1983. On 15 July 2001, ASIC applied to the Board for an order suspending Mr Gould's registration. On 21 December 2004, the Board made various orders including an order that the registration of Mr Gould as a liquidator be suspended for a period of three months. The orders had been preceded by a written determination and supporting reasons published on 26 August 2004. Mr Gould applied in this Court for prohibition against the Board and ASIC to prevent the taking of any further steps pursuant to the determination and the order. He also claimed a declaration that certain laws, in particular s 1292 of the Corporations Act, were invalid on the ground that the power to impose a penalty or otherwise punish a person is exclusively part of the judicial power of the Commonwealth and could not be exercised by the Board. The proceedings in this Court were remitted to the Federal Court and Black CJ directed that the Gould proceeding and the Albarran proceeding be dealt with by a Full Court. Mr Richard Albarran has been registered as a liquidator under the Corporations Act and its immediate predecessor since 19 August 1999. On 6 January 2005, ASIC applied to the Board for an order that Mr Albarran's registration be cancelled. Before the application was heard by the Board, Mr Albarran applied to this Court for an order preventing the taking of any further steps in the ASIC application. This Court refused a stay of the ASIC application and the balance of the cause was remitted to the Federal Court. The Board proceeded to a determination on 23 December 2005. This was adverse to Mr Albarran and, on 3 May 2006, the Board ordered a nine months suspension of his registration. On 21 March 2006, the Full Court heard argument in the Gould proceeding and the Albarran proceeding and, on 19 May 2006, published reasons in support of the conclusion that the exercise by the Board of power under s 1292(2) of the Corporations Act does not involve the exercise of the judicial power of the Commonwealth, with the consequence that each proceeding was to be dismissed with costs. Crennan The Board determinations Section 1292(2) provides as follows: "The Board may, if it is satisfied on an application by ASIC for a person who is registered as a liquidator to be dealt with under this section that, before, at or after the commencement of this section: the person has: contravened section 1288; or ceased to be resident in Australia; or that the person has failed, whether in or outside this jurisdiction, to carry out or perform adequately and properly: the duties of a liquidator; or any duties or functions required by an Australian law to be carried out or performed by a registered liquidator; or is otherwise not a fit and proper person to remain registered as a liquidator; by order, cancel, or suspend for a specified period, the registration of the person as a liquidator." The determinations by the Board in respect of Mr Gould and Mr Albarran were substantially the same. The Board determined that the registered liquidators in question had failed within the meaning of par (d)(ii) of s 1292(2) to carry out or perform adequately and properly the duties and functions required by Australian law to be carried out or performed by a registered liquidator. Counsel for Mr Gould, whose submissions in this respect were adopted by counsel for Mr Albarran, submitted that (a) the orders made by the Board involved "in effect" an adjudication of the question whether the respective liquidators had "a right to be registered"; and (b) there were determinations of wrongdoing or impropriety and the imposition of punishment "in the sense of visiting an adverse [and] stigmatising consequence". This combination of the nature of the Crennan determinations and the consequences thereof served to characterise what the Board had done as something that could only be done in exercise of the judicial power of the Commonwealth. That submission should be rejected. The judicial power of the Commonwealth In Federal Commissioner of Taxation v Munro8, Isaacs J instanced a trial for murder as a matter so clearly and distinctively appertaining to the judicial branch of government as to be incapable of exercise by another branch of government. That theme has been taken up in later cases. In R v Quinn; Ex parte Consolidated Foods Corporation9, Jacobs J described the governance of a trial for the determination of criminal guilt as the classic example of a matter for determination by a judiciary independent of the Parliament and the Executive. More broadly, in a well-known passage in R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd10, Kitto J emphasised the judicial function in determining a dispute inter partes as to the existence of a right or obligation in law and in applying the law to the facts as determined. These aspects of the judicial power of the Commonwealth will now be considered in turn. No determination of guilt and no punishment There has been no determination by the Board of whether Mr Gould or Mr Albarran has committed any offence whether under the Corporations Act or Consideration of R v White; Ex parte Byrnes11 assists an otherwise. understanding as to why that is the case. In White, this Court dealt with the disciplinary structure created by the Public Service Act 1922 (Cth) and emphasised the distinction between disciplinary proceedings and criminal proceedings; in the former category no offence was specified and no declaration (1926) 38 CLR 153 at 178. (1977) 138 CLR 1 at 11. See also Attorney-General (Cth) v Breckler (1999) 197 CLR 83 at 109 [40]; Luton v Lessels (2002) 210 CLR 333 at 357-358 [67], 386 10 (1970) 123 CLR 361 at 374-375. 11 (1963) 109 CLR 665. Crennan of guilt made. Subsequently, when delivering the advice of the Judicial Committee in Kariapper v Wijesinha12, Sir Douglas Menzies remarked: "Speaking generally, however, their Lordships would observe that it is not readily to be assumed that disciplinary action, however much it may hurt the individual concerned, is personal and retributive rather than corporate and self-respecting." In construing par (d) of s 1292(2), weight must be given to the introductory but controlling words "to carry out or perform adequately and properly". Of the words "proper" and "adequate" as they appear here, Tamberlin J said in Dean-Willcocks v Companies Auditors and Liquidators Disciplinary Board13 that they invite: "the testing of performance against a relevant standard or benchmark of performance. The interpretation advanced for the applicant, in my view, is too narrow in requiring the identification of a specific duty directly imposed by legislation. The level of performance called for is that of 'adequacy'. The standard is that the duty must be performed 'properly'." Section 203 of the ASIC Act, in dealing with the composition of the Board, requires that it include members appointed by the Minister from panels nominated by professional accountancy bodies. The section also now requires the appointment of "business members" from among persons the Minister is satisfied are suitable as representatives of the business community by reason of qualifications, knowledge or experience including business or commerce, the administration of companies, financial markets, and financial in fields 12 [1968] AC 717 at 737. 13 (2006) 59 ACSR 698 at 710. 14 This is the result of amendments made to s 203 by the Corporate Law Economic Reform Program (Audit Reform and Corporate Disclosure) Act 2004 (Cth), Sched 1, Pt 8, Items 135, 137. In respect of Mr Gould, the Board was constituted under the unamended legislation; in respect of Mr Albarran, the Board was appointed pursuant to the current provision. Crennan Against that background, in Dean-Willcocks, Tamberlin J went on to observe that par (d)(ii) of s 1292(2)15: "is designed to enable a board representative of the commercial and accounting communities to consider whether the function has been adequately and properly carried out. To assess this, it is permissible, in my view, to have regard to the standards operative in the relevant sphere of activity." That reasoning of Tamberlin J should be accepted as indicative that the function performed by the Board in the present cases was not the ascertainment or enforcement of any existing right or liability in respect of an offence and the punishment for an offence. So, also, should the conclusion expressed by the Full Court in the judgment here under appeal. Their Honours said16: "The function of the Board is not, as was submitted, to find (as an exercise of deciding present rights and obligations in the above sense) whether an offence has been committed and, if so, to inflict a punishment therefor. It is, as we have said, to assess whether someone should continue to occupy a statutory position involving skill and probity, in circumstances where (not merely because) the Board is satisfied that the person has failed in the performance of his or her professional duties in the past. Messrs Gould and Albarran say that punishment or a penal or harmful consequence is finally inflicted on the person consequent upon the finding of the committal of an offence prescribed by law. That is not what s 1292(2) says the function of the Board is. It is not, in substance, what the Board does." This construction of par (d) of s 1292(2) is not qualified or displaced by any considerations flowing from the final words in that paragraph "or is otherwise not a fit and proper person to remain registered as a liquidator". 15 (2006) 59 ACSR 698 at 710. 16 (2006) 151 FCR 466 at 478. Crennan In Hughes and Vale Pty Ltd v The State of New South Wales [No 2]17, Dixon CJ, McTiernan and Webb JJ, after saying that the expression "fit and proper person" was familiar as comprising "traditional words" when used with reference to offices and vocations, added that the very purpose of the expression was to give the widest scope for judgment and indeed for rejection; thus, "fit" involved honesty, knowledge and ability. That passage was relied upon by Hill J in Davies v Australian Securities Commission18 when construing an earlier provision drawn in the same terms as s 1292(2) of the Corporations Act. Counsel for the Attorney-General in the present appeals correctly submitted that the words "adequately and properly" import notions of judgment by reference to professional standards rather than pure questions of law and that the concluding expression containing the words "otherwise not a fit and proper person" expands or adds to what precedes it but does not draw in a discrete subject-matter. Tasmanian Breweries19 The purpose or object of the inquiry undertaken by the Board in exercising its power conferred by s 1292(2) is not the ascertainment or enforcement of any existing right or liability in the sense found in the reasoning of Kitto J in Tasmanian Breweries20. We turn to explain why that is so. As a starting point, it should be noted that the determination of legal rights spoken of in the joint judgment of five members of the Court in Re Cram; Ex parte Newcastle Wallsend Coal Co Pty Ltd21 as involving the exercise of the 17 (1955) 93 CLR 127 at 156. See also A Solicitor v Council of The Law Society of New South Wales (2004) 216 CLR 253 at 261 [3], 267-268 [20]; X v Australian Prudential Regulation Authority (2007) 81 ALJR 611; 232 ALR 421. 18 (1995) 59 FCR 221 at 232. 19 (1970) 123 CLR 361. 20 (1970) 123 CLR 361 at 374-375. 21 (1987) 163 CLR 140 at 148. Crennan judicial power of the Commonwealth was not limited to matters of criminal "A claim for the payment of wages due and payable by an employer to an employee is a claim for the enforcement of an existing legal right. Likewise, a claim for the enforcement of a provision in an award for the payment of wages to an employee is also a claim for the enforcement of an existing legal right. Claims for the enforcement of existing legal rights necessarily invoke the exercise of judicial power." However, later in the same judgment, their Honours added23: "Indeed, a tribunal may find it necessary to form an opinion as to the existing legal rights of the parties as a step in arriving at the ultimate conclusions on which the tribunal bases the making of an award intended to regulate the future rights of the parties: [R v Gallagher; Ex parte Aberdare Collieries Pty Ltd]24. Of course, the formation of such an opinion does not bind the parties and cannot operate as a binding declaration of rights." The Attorney-General correctly submits that, to the extent that with respect to Mr Gould and Mr Albarran the Board was required to form an opinion as to existing rights, that was no more than a step necessary to its ultimate conclusion. This was whether, in terms of par (d)(ii) of s 1292(2), the performance of duties or functions required by Australian law had been carried out or performed "adequately and properly". Further, the Full Court put the matter correctly when it said25: 22 (1987) 163 CLR 140 at 148 per Mason CJ, Brennan, Deane, Dawson and 23 (1987) 163 CLR 140 at 149. See also the judgments of the whole Court in Precision Data Holdings Ltd v Wills (1991) 173 CLR 167 at 189, and of Mason CJ, Brennan and Toohey JJ, and of Deane, Dawson, Gaudron and McHugh JJ, in Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245 at 258, 268 respectively. 24 (1963) 37 ALJR 40 at 44. 25 (2006) 151 FCR 466 at 477-478. Crennan "If one takes the exercise of power here – that is to terminate or suspend a right or status, created by statute, by reference, in part, to past conduct – it can be readily accepted that a court might do this or an administrative tribunal might do this. This is not a power which is inherently judicial. The character of the Board, the undoubted bringing to bear by the Board of professional standards (with the knowledge of which its members can be taken to be imbued), an absence of an assigned task of deciding a controversy between parties as to the existence or not of present mutual rights and obligations of those parties upon the application of the law to past events, the exercise of an evaluative and discretionary power in the protection of the public as to whether a person is fit and proper to continue to hold a position of importance provided for by the statute, all combine to give the conclusion that the conferral on the Board of the power in s 1292 is not judicial." Historical considerations There are two further submissions to be considered. With an eye to R v Davison26, in the Gould appeal the appellant referred to historical considerations concerning the control and direction of liquidators exercised by the Court of Chancery and its successors. In his general statement of principle in Tasmanian Breweries27, Kitto J put to one side questions of the application of "traditional concepts" as in Davison. In their joint judgment in that case, Dixon CJ and McTiernan J referred to the long history of the English law of bankruptcy as "the process by which a compulsory sequestration has been brought about has always been of a description which may properly be called judicial". However, counsel for the Attorney-General correctly emphasised that historical considerations concerning the role of liquidators did not disclose the exercise by the courts of any general role in the exercise of functions of a disciplinary nature such as those performed by the Board. It may also be 26 (1954) 90 CLR 353. 27 (1970) 123 CLR 361 at 373. 28 (1954) 90 CLR 353 at 365. Crennan remarked that in England the Board of Trade was given significant powers to supervise the conduct of liquidators by legislation pre-dating the adoption in Australia of the Constitution29. The reasoning in Davison does not assist the appellants. Laws of domestic and general application In oral submissions, counsel for Mr Albarran sought to develop a determinative distinction for the constitutional purposes of these appeals between laws of domestic and general application. Counsel instanced the jurisdiction of university visitors in England and the position established by decisions including R v Lord President of the Privy Council; Ex parte Page30. In that case, Lord Browne-Wilkinson applied to the University of Hull what his Lordship said the common law for 300 years had recognised, namely, that the decision of the visitor on questions of law and fact was final and conclusive and not to be reviewed by the courts31. This, counsel now submitted, was an instance of "intramural" or domestic disciplinary arrangements which did not attract the exercise of judicial power, even by way of judicial review. However, the extent to which the English decisions respecting visitors to universities are applicable in Australasia, where educational structures differ, is unsettled32. In any event, members of the Board are officers of the Commonwealth and s 75(v) of the Constitution itself provides a measure of judicial review. 29 See s 25(1) of the Companies (Winding up) Act 1890 (UK), which stated: "The Board of Trade shall take cognizance of the conduct of liquidators of companies which are being wound up by order of the court, and in the event of any such liquidator not faithfully performing his duties and duly observing all the requirements imposed on him by statute, rules, or otherwise, with respect to the performance of his duties, or in the event of any complaint being made to the Board by any creditor or contributory in regard thereto, the Board shall inquire into the matter, and take such action thereon as may be deemed expedient." 31 [1993] AC 682 at 703. 32 See the Australasian authorities referred to in Griffith University v Tang (2005) 221 CLR 99 at 116 [40]. Crennan Counsel also referred to the public service regulatory scheme considered in R v White; Ex parte Byrnes33. However, the Court there did not rely on any distinction such as that now sought to be drawn; rather, as mentioned earlier in these reasons, the Court emphasised the differential outcome involved in disciplinary and criminal proceedings. Counsel submitted that, whilst disciplinary arrangements in "domestic areas" such as those considered in Page and White do not engage the judicial power of the Commonwealth, the contrary is the case where (i) the rules in question are found in a law of "general application" and (ii) punishment is inflicted for breach of such a law. Section 1292 was found in a law of this character and punishment was said to have been inflicted. To this, two things are to be said. First, upon the grounds given earlier in these reasons, no "punishment" in the sense of the authorities dealing with the judicial power of the Commonwealth has been inflicted by the determination and orders made by the Board. Secondly, the suggested discrimen which fixes upon laws of domestic and general application is obscure and, more fundamentally, does not provide an appropriate basis for the distinctions required when construing the phrase "the judicial power of the Commonwealth" in Ch III of the Constitution. Rather, as the Attorney-General submitted, the focus in the authorities is upon the manner in which and subject-matter upon which the body purportedly exercising the purposes and consequences of any decisions it makes. Examples include Attorney-General (Cth) v Breckler34 and Luton v Lessels35. judicial power operates and Functional analysis Although much attention was given to the matter in argument, there is no occasion here to canvass the line of authorities which establish that there are some powers which appropriately may be treated as administrative when conferred on an administrative body and as judicial when conferred on a federal 33 (1963) 109 CLR 665. 34 (1999) 197 CLR 83. 35 (2002) 210 CLR 333. Crennan court or court exercising federal jurisdiction36. The appellants in these appeals have sought to demonstrate that s 1292(2) of the Corporations Act confers upon the Board not a power of a chameleon-like nature which would take its colour from the administrative nature of the Board, but a power of an essentially judicial character so that the power, to be valid, may be conferred only upon a Ch III court. Orders Each appeal should be dismissed. The Attorney-General seeks no costs order. 36 Pasini v United Mexican States (2002) 209 CLR 246 at 253-254 [12]-[13]. Kirby KIRBY J. These appeals from a judgment of the Full Court of the Federal Court of Australia37 concern the meaning of the phrase "the judicial power of the Commonwealth" in s 71 of the Constitution. If, by federal legislation, such "judicial power" is to be exercised, it must be vested in a Ch III court. It cannot be vested in a legislative committee38; nor in an officer, or a tribunal or other body established within the executive government. The Companies Auditors and Liquidators Disciplinary Board ("the Board") does not purport to be a Ch III court. Its constitution is provided for in Pt 11 Div 1 of the Australian Securities and Investments Commission Act 2001 (Cth) ("the ASIC Act")39. Its members are "officer[s] of the Commonwealth" for the purposes of s 75(v) of the Constitution. The Board and its members are part of the executive. They do not constitute a "court". The issue in these appeals is whether, in determining the challenges brought separately by the two appellants, Mr Richard Albarran and Mr Vanda Gould, the Full Court erred in holding that the Board and its members, in discharging the powers given to them by s 1292(2) of the Corporations Act 2001 (Cth) ("the Corporations Act"), were not exercising the judicial power of the Commonwealth40. The appeals should be dismissed. In my view, the Full Court was correct in its conclusion and in its general approach. A "'functional' analysis"41 was appropriate to the issues tendered by the parties42. The Full Court's judgment should be confirmed43. 37 Albarran v Members of the Companies Auditors and Liquidators Disciplinary Board (2006) 151 FCR 466 (Emmett, Allsop and Graham JJ). 38 Moore, The Constitution of the Commonwealth of Australia, 2nd ed (1910) at 39 See ASIC Act, s 203, which outlines the membership of the Board. 40 (2006) 151 FCR 466 at 478 [52]. 41 H A Bachrach Pty Ltd v Queensland (1998) 195 CLR 547 at 562 [15]. 42 (2006) 151 FCR 466 at 477-478 [46]-[48]. 43 cf reasons of Gleeson CJ, Gummow, Hayne, Callinan, Heydon and Crennan JJ ("joint reasons") at [36]. Kirby The facts and legislation The facts: Mr Albarran is a chartered accountant. He was first registered as a company liquidator in 1999 under statutory provisions continued under the Corporations Act44 after that Act commenced in 2001. In January 2005, pursuant to s 1292(2) of the Corporations Act, the Australian Securities and Investments Commission ("ASIC") applied to the Board for orders cancelling Mr Albarran's registration as a liquidator45. Originally, ASIC pressed eight contentions against Mr Albarran. Only one (contention 1) was found by the Board to have been established. This alleged that Mr Albarran had participated in a contrived nominee arrangement, the essence of which was that identified persons were appointed to administer a company whilst, in effect, Mr Albarran or his firm performed the functions of administrator and received related payments. ASIC's allegation was that Mr Albarran and any member of his firm were precluded from accepting appointment as administrator because Mr Albarran's firm had a disqualifying conflict of interest. By inference, ASIC's contention was that Mr Albarran continued the disqualification. the arrangement complained of to circumvent in order In December 2005, in respect of the first contention, the Board determined that Mr Albarran had "failed to fulfil his duties under s 1292(2)(d)(ii)" of the Corporations Act. The Board ordered that Mr Albarran's registration as a liquidator be suspended for nine months. Pending the outcome of these proceedings, the operation of that order has been stayed by the Administrative Appeals Tribunal ("the AAT")46. Mr Gould was likewise registered as a liquidator. He practised in that capacity, also pursuant to a registration deemed to subsist under the Corporations Act47. 44 See Corporations Act, ss 1279, 1282. Note Corporations Law, ss 1278, 1279, 1282 (repealed). See also joint reasons at [12]. 45 Mr Albarran subsequently sought a stay of the ASIC application in this Court: see joint reasons at [12]. 46 Under the Administrative Appeals Tribunal Act 1975 (Cth), s 41(2). 47 Note that all breaches of duty alleged by ASIC against Mr Gould were said to have occurred prior to the commencement of the Corporations Act, thus falling under the Corporations Law as then applicable. Kirby The application to the Board in Mr Gould's case was made by ASIC in July 2001. It alleged that he had failed, in a number of respects, to carry out or perform adequately and properly the duties or functions required by law of a registered liquidator. The Board found that some, but not all, of ASIC's contentions against Mr Gould were established. It ordered that his registration as a liquidator be suspended for a period of three months from the coming into effect of its order. That order was also stayed by the AAT, pending the outcome of these proceedings. The foregoing facts cut both ways. On the one hand, they illustrate the serious character of the orders of the Board and the impact that such orders would have, if sustained and given effect, upon the property of each of the appellants, in the sense of their respective entitlements to earn their professional livelihood during the period of suspension. If upheld, they would also impinge on the entitlements of the appellants to enjoy an unblemished reputation amongst chartered accountants and others as persons suitable to be appointed as liquidators of companies48. On the other hand, the facts illustrate the way in which the Board's functions are performed within the comprehensive legislative scheme established by the Corporations Act. It is that Act that now provides the legal authority ("registration") for persons to act as company liquidators and upholds the standards required of that office as an incident of registration. The Act does this, amongst other ways, by suspension of registration for a specified period for a proved failure to carry out or perform, adequately and properly, the duties or functions of the office. The provisions play an integral part in the maintenance of high standards in the governance of corporations in Australia and the administration of those corporations during winding up. 48 See International Covenant on Economic, Social and Cultural Rights ("ICESCR"), Art 6 (right to work); International Covenant on Civil and Political Rights ("ICCPR"), Art 17 (right to reputation). The ICCPR and ICESCR were adopted and opened for signature, ratification and accession by General Assembly Resolution 2200A(XXI) on 16 December 1966. The ICCPR entered into force generally on 23 March 1976 in accordance with Art 49 and entered into force in Australia on 13 November 1980: [1980] ATS 23. The ICESCR entered into force generally on 3 January 1976 in accordance with Art 27 and entered into force in Australia on 10 March 1976: [1976] ATS 5. Kirby Other facts relevant to the appeals are set out in the reasons of Gleeson CJ, Gummow, Hayne, Callinan, Heydon and Crennan JJ ("the joint reasons")49. None of the facts was contested in the appeals. The legislation: The provisions of s 1292(2) of the Corporations Act are also set out in the joint reasons50. So too is a description of the provisions of s 203 of the ASIC Act, explaining the past and present requirements for the composition of the Board so that it includes persons with relevant accounting and business experience51. Self-evidently, the object of constituting the Board in this way was to ensure that the body determining the contentions of ASIC, presented by its applications to the Board, could do so with full knowledge of ordinary practice and with sensitivity to proper professional standards. Inferentially, the object included the avoidance of the necessity to prove all the details of such practice and standards that might have been required in the case of a non-expert generalist court. Once again, provisions of this kind cut both ways. On the one hand, they ensure that the decision-maker is aware of any relevant practicalities that may arise in company liquidations, so that attention is not solely paid to the letter of the law. On the other hand, the common assumptions and expectations of specialists can sometimes demand standards not readily apparent to an untutored eye, informed only by a legislative text. Occasionally, they may be more demanding although not spelt out in a normative way. The reason for separating judicial power The basic requirement: The appellants' argument that orders of the kind made against them could not be made by a body such as the Board, but only by a Ch III court, involved the assertion that, in Australia, under federal legislation, some governmental functions can only be performed by "courts"52. In the past, this argument was advanced largely by reference to verbal analysis of the phrase "the judicial power of the Commonwealth" in s 71 of the Constitution. However, especially in more recent decades, with the expansion of 49 Joint reasons at [10]-[15]. 50 Joint reasons at [14]. 51 Joint reasons at [19]. 52 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 296. Kirby the modern regulatory state, a verbal analysis would only take the decision-maker so far. Given the rapid expansion of the number, type and variety of decisions that have to be made under federal legislation, often having deleterious consequences for natural or legal persons, it is necessary to have some concept of the decision-making functions that, of their character, are reserved to courts, so as to distinguish them from those that are not. To identify those functions, it may be useful, though not determinative, to have regard to considerations of history, analysis of typical judicial activities and an understanding of the reasons given by this Court in deciding such questions in the past. The starting point for answering a challenge of the type brought by the appellants is a recollection of the fundamental purpose (or function) of this feature of the Australian Constitution and of the doctrine of the separation of powers that has been found within it53. Why is it inherent in the Constitution that "the judicial power of the Commonwealth" must only be vested in Ch III courts? Why must that power not be intermingled with judicial and non-judicial functions54? Why is the performance of some functions consistent with the exercise of judicial power as well as the exercise of non-judicial power so that they may, at the option of the Parliament, be exercised by a Ch III court or by an executive body or even by both alternatively or consecutively55? The rationale of separation: To answer these questions, it is necessary to return to the purpose of this aspect of the separation of powers doctrine, as it appears from the text and structure of the Constitution and as it has been expounded by this Court. What is involved is not simply a matter of words. At the heart of the requirement is a notion of the type of governance established by the Constitution and a belief that such governance is best, or only, secured by keeping the Judicature, provided for in Ch III, separate from the other governmental powers in the nation. The language of the Constitution alone might perhaps have permitted a less rigid separation of powers doctrine to emerge. Thus, the separate treatment of Ch III in the text of the Constitution might have been treated as nothing more 53 See Constitution, ss 1, 61, 71; Boilermakers (1956) 94 CLR 254 at 275-276. 54 See Boilermakers (1956) 94 CLR 254 at 296. 55 See R v Joske; Ex parte Australian Building Construction Employees and Builders' Labourers' Federation (1974) 130 CLR 87 at 95; R v Quinn; Ex parte Consolidated Foods Corporation (1977) 138 CLR 1 at 6, 9-12; Attorney-General (Cth) v Breckler (1999) 197 CLR 83 at 126-127 [83]-[84]. Kirby than a convenient drafting device56. The importation of American rigidities might have been rejected as unsuitable to the Australian Constitution where the executive is intended to sit in Parliament, thereby making a strict separation of the three branches of government impossible57. Alternatively, any rigid theory might have been confined to this Court and held inapplicable to other Ch III courts because this Court alone is identified by name in s 71 of the Constitution and arguably has special needs for insulation from other governmental pressures or influences in order to discharge its vital federal role58. Perhaps the language of s 71 might have been construed as non-exhaustive of the deployment of federal judicial power59. Or more "exceptions" might have been acknowledged to the exclusive vesting of federal judicial power in Ch III courts60, so as to cast doubt on the principle of strictly separating "the judicial power of the Commonwealth". Instead of taking any of the above approaches, this Court adopted a strict view. In part, this was done because of the perceived requirements of the language and structure of the Constitution. But that textual analysis has been reinforced by identified requirements of abiding constitutional principle. The governing principle can be traced to concepts expounded in Alexander Hamilton's views61 concerning the special need in a federation to have a branch of government, the judiciary, which was insulated from the other branches of government so as to be able to perform the functions essential to its purposes62. Hamilton considered the independence of the judiciary from the 56 Wheeler, "The Boilermakers Case", in Lee and Winterton (eds), Australian Constitutional Landmarks, (2003) 160 at 161-162, citing Garran, Prosper the Commonwealth, (1958) at 194. 57 Constitution, s 64. 58 Zines, The High Court and the Constitution, 4th ed (1997) at 212-213. 59 See eg Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 604-611 [197]-[210]; Ruhani v Director of Police (2005) 222 CLR 489 at 545-550 [173]-[191]. 60 Such as those so far allowed under the defence power (s 51(vi)) or the territories power (s 122). See Re Tracey; Ex parte Ryan (1989) 166 CLR 518 at 540-541; Re Governor, Goulburn Correctional Centre; Ex parte Eastman (1999) 200 CLR 322 at 333 [11], 348 [63]; cf at 378 [143]. 61 Reproduced in Hamilton, Madison and Jay, The Federalist or, The New Constitution, (1911) at 396: "The complete independence of the courts of justice is peculiarly essential in a limited Constitution. … Without this, all the reservations of particular rights or privileges would amount to nothing." 62 Principality of Monaco v Mississippi 292 US 313 at 322-323 (1934). Kirby other arms of government essential to ensure impartial decision-making in those matters where, otherwise, there was a risk of encroachment and partiality in the administration of federal laws affecting such matters as the "life, liberty or property"63 of those who are subject to such laws. It is as well to recall the explanations for the functional separation, and guaranteed exclusivity, of Ch III courts when judging challenges like the present, arising in new legislative circumstances. Simply to apply passages from reasons in a few earlier cases by analogy or to pluck sentences and phrases from the opinions of our predecessors, is to risk losing one's constitutional bearings. Alternatively, it is to succumb, in effect, to a "vibes" approach to constitutional adjudication64. It may overlook the importance of the constitutional design as a protection for the "basic legal rights" secured by that design65. In upholding a rule of strictness expressed by this Court in this context66, the Privy Council explained in 195767: "[I]n a federal system the absolute independence of the judiciary is the bulwark of the constitution against encroachment whether by the legislature or by the executive. To vest in the same body executive and judicial power is to remove a vital constitutional safeguard." A decade after those words were written, in Liyanage v The Queen68, an appeal from Ceylon, the Privy Council wrote in similar, even stronger, language. Their Lordships identified dangers that exist in any country where other branches of government sometimes seek to bypass or encroach upon the independent and impartial courts. Doing so threatens to deprive those subject to the law in that 63 Huddart, Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330 at 357 per Griffith CJ; cf Waterside Workers' Federation of Australia v J W Alexander Ltd (1918) 25 CLR 434 at 469-470 per Isaacs and Rich JJ. 64 See Israel, Handsley and Davis, "'It's the Vibe': Fostering Student Collaborative Learning in Constitutional Law in Australia", (2004) 38 Law Teacher 1. 65 Quinn (1977) 138 CLR 1 at 11-12 per Jacobs J. 66 Boilermakers (1956) 94 CLR 254 at 267-268, 275-276, 295-296. 67 Attorney-General (Cth) v The Queen (1957) 95 CLR 529 at 540-541; [1957] AC Kirby country of the special characteristics typical of the exercise of judicial power in the courts. The Privy Council explained69: "[I]n their Lordships' view … there exists a separate power in the judicature which under the Constitution as it stands cannot be usurped or infringed by the executive or the legislature. [T]heir Lordships are not prepared to hold that every enactment … which can be described as ad hominem and ex post facto must inevitably usurp or infringe the judicial power. Nor do they find it necessary to attempt the almost impossible task of tracing where the line is to be drawn between what will and what will not constitute such an interference. Each case must be decided in the light of its own facts and circumstances, including the true purpose of the legislation, the situation to which it was directed, the existence … of [any] common design, and the extent to which the legislation affects, by way of direction or restriction, the discretion or judgment of the judiciary in specific proceedings." Liyanage was an extreme case. It was judged to be akin to taking judicial power "out of the hands of the judges"70. However, the Privy Council's warning was that the erosion of the "judicial power" and its "usurpation" by the other branches of government infringed the basic constitutional design of Ceylon because it undermined the assignment of the "judicial power" to a special class of public officials, namely the judges, who operate in a particular and public way, with guaranteed protection against interference and retaliation. They are the officials who are protected by tenure, remuneration, appellate and other procedures of review, as well as by convention and long tradition, against the power, influence, opinions and potential partiality of other public office-holders, operating in the other branches of government. The essential reason behind the separation of powers doctrine as it applies to the judiciary is as true today as it was when the Privy Council's words were written. What was said in respect of the Constitution of Ceylon applies with equal or even greater force in respect of the Australian Commonwealth because our Constitution is older and, in respect of the judicial branch, was consciously modelled on that of the United States of America. If anything, the growth of the modern regulatory state71, and of powerful and opinionated officials in the 69 [1967] 1 AC 259 at 289-290. 70 [1967] 1 AC 259 at 291. 71 Joint reasons at [19]. Kirby executive government answerable to political ministers, has increased and not diminished the importance of safeguarding this separation. However, the difficulty remains one of distinguishing the functions that may only be vested in Ch III courts from those that need not be. Like the Privy Council in Liyanage72, this Court has found it impossible to identify in a universally applicable formula exactly "where the line is to be drawn"73. Yet saying that each case must be decided only on its own facts, or resolving challenges such as the present only by factual analogies with past decisions involving different legislation, risks performing this Court's function in a constitutional vacuum and in an unconvincing and unsatisfying way. Desirability of predictable criteria: Criticism of this Court's decisions on the issue of principle presented by these appeals suggests that they have lacked a coherent doctrine74; deployed criteria that are difficult to predict75; and embraced overly fine distinctions76 that cannot easily be traced to an identified principle or policy77. It is said that this has resulted in ad hoc determinations that lack a consistent rule. The strongest criticism in this regard has been reserved for the so-called "chameleon"78 principle of "innominate"79 functions80. By this principle, it has 72 [1967] 1 AC 259 at 289-290. 73 See Breckler (1999) 197 CLR 83 at 113-114 [53], 124-126 [78]-[81]. 74 Ratnapala, Australian Constitutional Law: Foundations and Theory, 2nd ed (2007) ("Ratnapala") at 124, 129. 75 Williams, "Commentary", in Stone and Williams (eds), The High Court at the Crossroads, (2000) 178 ("Williams") at 179. 76 Williams at 181; Perry, "Chapter III and the Powers of Non-Judicial Tribunals: Breckler and Beyond", in Stone and Williams (eds), The High Court at the Crossroads, (2000) 148 at 177. 77 Ratnapala at 143. 78 Quinn (1977) 138 CLR 1 at 18 per Aickin J. 79 See Ratnapala at 136-147. 80 Starting with the reasons of Isaacs J in Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 176-180. See also R v Spicer; Ex parte Australian Builders' Labourers' Federation (1957) 100 CLR 277 at 305; R v Hegarty; Ex parte City of Salisbury (1981) 147 CLR 617 at 628, 631-632; Love v Attorney-General (NSW) (Footnote continues on next page) Kirby been accepted that a parliamentary assignment of a particular function may, in certain instances81, colour the constitutional characterisation of the exercise of that function. If it were left uncontrolled, this principle could have a tendency to subvert the constitutional separation of powers82. It could encourage the notion that, effectively, it is for the Parliament, and not the courts, to draw the constitutional line. Yet, this has never been the way that I have understood the "chameleon" principle to apply83. In every case, it is for the courts (ultimately this Court) to characterise the federal law in question and to decide whether it involves the vesting of federal judicial power in an impermissible repository. If it does, by s 71 of the Constitution, such an assignment is invalid. The power in question must be vested in a Ch III court and not elsewhere. The appellants were too prudent to call to notice the criticisms of this aspect of the Court's constitutional jurisprudence84. However, if it is the case that no exhaustive definition can be provided for the phrase "the judicial power of the Commonwealth"85 and if future attempted definitions are likely to be no more successful or universal than those offered in the past86, this does not mean that the issue is left entirely at large. (1990) 169 CLR 307 at 320-321; cf Sawer, "Judicial Power Under the Constitution", in Else-Mitchell (ed), Essays on the Australian Constitution, 2nd ed (1961) 71; Lane, "The Decline of the Boilermakers Separation of Powers Doctrine", (1981) 55 Australian Law Journal 6; Gibbs, "The Separation of Powers – A Comparison", (1987) 17 Federal Law Review 151 at 157-159; de Meyrick, "Whatever Happened to Boilermakers? Part I", (1995) 69 Australian Law Journal 81 These instances are described by Kitto J in Spicer (1957) 100 CLR 277 at 305. 82 Ratnapala at 132-133, 135. 83 Pasini v United Mexican States (2002) 209 CLR 246 at 268-269 [62], 84 See Lane's description of the reasoning as "formulary": Lane, Some Principles and Sources of Australian Constitutional Law, (1964) at 114-115. 85 R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 374, 396; Precision Data Holdings Ltd v Wills (1991) 173 CLR 167 at 188-189; Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245 at 267-268. 86 Jackson, "The Australian Judicial System: Judicial Power of the Commonwealth", (2001) 24 University of New South Wales Law Journal 737 at 743. Kirby However, judicial power of The Court's decisions afford a general description of what is involved in "judicial power"87. the the phrase "the Commonwealth" in s 71 involves a narrowing of that notion because of other provisions in the constitutional text, most notably the requirement that there must be a "matter"88 for every exercise of federal judicial power. This requirement, in turn, reserves that "power" to the determination of controversies by the application of legal norms. Under current doctrine, it excludes purely advisory or hypothetical decision-making by Ch III courts pursuant to federal legislation89. It also excludes participation by such courts (or by serving judges of federal courts) in the investigation of crime90. It forbids the provision of non-binding advice to the executive, effectively as part of executive government operations91. Identifying the functions that are alien to federal judicial power, which cannot be vested in a Ch III court by federal law, is simpler than identifying the functions that must be so vested. Yet that is the issue ultimately presented by these appeals. So why did the appellants submit that the decision committed by the Corporations Act to the Board fell outside the "innominate" functions that might be performed, pursuant to federal law, by an executive body or by the judiciary or by both (as the Parliament, according to its decision, pleased)? Why did the appellants contend that the functions committed to the Board under s 1292(2) of the Corporations Act were, of their nature, required to be vested in a Ch III court? in s 1292(2) comprised part of "the The formal answer to these questions is that the appellants argued that vesting in a court was what was required by the Constitution because the powers appearing the Commonwealth". However, when pressed for further elaboration, the reasons offered by the appellants were that, on balance, by reference to considerations of history, practical effect, normative function and intended operation, the powers conferred by s 1292(2) were properly to be characterised as part of "the judicial power of the Commonwealth". They were powers that properly belonged to the Judicature alone. They were thus invalidly vested in the Board because it was judicial power of 87 See esp Huddart Parker (1909) 8 CLR 330 at 357. 88 Constitution, ss 75, 76 and 77. 89 The State of South Australia v The State of Victoria (1911) 12 CLR 667 at 674-675, 715; In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 267. 90 Hilton v Wells (1985) 157 CLR 57 at 72-73. 91 Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 16, 25; cf at 47-48. Kirby not part of the Judicature. Its orders concerning the appellants' status as registered liquidators were therefore invalid. The appellants asked this Court to so declare and to relieve them of the Board's orders. The appellants' arguments A functional approach: The parties involved in these appeals tackled the issues before this Court by way of a "functional analysis"92 of the powers enlivened by s 1292(2) of the Corporations Act. In these proceedings, it would be difficult to undertake a sensible examination of the questions to be decided in any other way. Evaluating the criteria for the presence of "the judicial power of the Commonwealth" cannot be undertaken in a vacuum, divorced from considerations of constitutional principle and policy. It is necessary to have some conception of the "functions" of courts which particular criteria may suggest to be exclusive, or non-exclusive, to such bodies. Both in his written and oral submissions, Mr Gould acknowledged that cases such as his case presented questions of degree93. The Court was therefore involved in the drawing of a "line". He submitted that, in the present instance, s 1292(2) fell on the wrong side of the line. He did not suggest that any feature of that sub-section conclusively demonstrated that it involved an exercise of federal judicial power. Nor did he argue that the Board's functions lacked any features apt to the exercise of administrative, as distinct from judicial, power. He simply submitted that the combination of functions reposed in the Board disclosed an exercise of the judicial power of the Commonwealth which was therefore impermissibly assigned to the Board, a body other than a Ch III court. It would not be correct to say that the "chameleon" principle was missing from the arguments of the parties. It was expressly acknowledged by Mr Gould. It was certainly relied on by the Commonwealth94. It is undesirable to attempt a checklist of criteria for the existence of federal judicial power which is divorced from a notion about the essential functions reserved to the exercise of that power95. A conception of those functions provides the glue that holds together particular characteristics, detected in past cases. 92 cf joint reasons at [36]. 93 [2007] HCATrans 005 at 867, 878-879. Mr Albarran did not refer to "functional analysis" in his submissions. However, I agree with the Attorney-General's submission that it was implicit in his argument. 94 [2007] HCATrans 005 at 2361-2363, 2915-2920, 3163-3172. 95 Breckler (1999) 197 CLR 83 at 125 [79]. Kirby Having said this, what are the features of the power conferred by s 1292(2) relied on by the appellants to establish that those functions belonged exclusively to the federal judicial power and thus could not be vested in the Board? Historical considerations: Mr Gould pointed out that company liquidators have existed in our legal tradition since the company law reforms in the United Kingdom in the mid-nineteenth century. Initially, The Joint Stock Companies Winding-up Act 1848 (UK) provided for the Master of the Court of Chancery to appoint a person or persons to be the official manager or managers of a company undergoing winding up96. The appointee or appointees were subject to judicial supervision and removal for cause. When, following The Joint Stock Companies Act 1856 (UK), provision was made for "liquidators" to be involved in the winding up of the affairs of a company and an "official liquidator" was appointed by the Court on a compulsory winding up, those officers also acted under the control and direction of the Court97. Of their nature, from the start, company liquidators had functions of high responsibility. They bore a fiduciary character and, in some respects, they were quasi-judicial. The appellants argued that, as a matter of history, the adjudication of the question of whether a liquidator should be removed from office in a particular winding up was traditionally reserved to, and determined by, a court. To the extent that it is relevant to examine considerations of history in deciding whether a function is, or is not, exclusively "judicial", the history of company liquidators, dating back to the origin of that office in our legal tradition, was said to support judicial and not administrative supervision. Of course, history did not stand still when the Constitution was adopted. The regulation of corporations expanded greatly throughout the twentieth century. It did so out of a recognition of the growing role that corporations came to play in the economy of the nation and of the world98. Such recognition, partly in response to corporate failures and losses to shareholders, creditors, employees and others, produced much more detailed regulation of corporations before, but particularly after, the 1990s99. Nevertheless, the traditional relationship between liquidators and courts indicated (as the Commonwealth conceded) that the 97 See ss 88-93. See also Companies Act 1874 (NSW), ss 151-156. 98 New South Wales v Commonwealth (2006) 81 ALJR 34 at 88-91 [183]-[196], 143-144 [484]-[485]; 231 ALR 1 at 56-60, 131. 99 Rich v Australian Securities and Investments Commission (2004) 220 CLR 129 at Kirby regulation and discipline of liquidators could, as in early history, have been assigned to a court. That left open the question whether it must be so assigned in order to conform to the Australian constitutional design. Features of punishment: The appellants' central contention was that amongst the functions reserved exclusively to courts were those concerned with punishment: in other words, a determination of wrong-doing of a public nature100, in consequence of which a sanction is imposed on a person to indicate the established wrong-doing and to provide deterrence to others by virtue of the sanction in the particular case. The Commonwealth accepted as "undoubtedly true" that "the adjudgment and punishment of criminal guilt under a law of the Commonwealth" was "exclusively judicial"101. However, the appellants contested any sharp distinction between the operation of criminal punishment and professional discipline. They submitted that the question of whether a particular order was punitive, so as to be reserved to a Ch III court, was not to be decided merely by reference to the nomenclature adopted by the Parliament. Thus, the proliferation of "civil penalties" would not necessarily escape the constitutional requirement that punishment of a public nature under federal law must be reserved to judicial determination and orders. Nor did the appellants accept a strict dichotomy between "punitive" and "disciplinary" provisions. Although a law might answer to the description of "disciplinary", in the federal context, it might also involve the infliction of public punishment reserved to judicial determination and judgment. In support of this dual characterisation of disciplinary provisions, both appellants invoked what was said by five members of this Court in Rich v Australian Securities and Investments Commission102. Although expressed in a different legal context, the observations of the Court in that case are not to be denied. In truth, they are self- evident: "[T]he supposed distinction between 'punitive' and 'protective' proceedings or orders suffers the same difficulties as attempting to classify all proceedings as either civil or criminal. At best, the distinction between 'punitive' and 'protective' is elusive. That point is readily illustrated when it is recalled that … account must be taken in sentencing a criminal 100 R v Wigglesworth [1987] 2 SCR 541 at 560. 101 Citing Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 27. 102 (2004) 220 CLR 129 at 145 [32] (footnotes omitted). Kirby offender of the need to protect society, deter both the offender and others, to exact retribution and to promote reform." Adapting those words to the present context, the appellants submitted that the orders made by the Board in relation to each of them constituted a public punishment. The orders impinged substantially on their economic freedom, particularly their capacity to earn their livelihood. The orders also diminished their reputations103. In these circumstances, the appellants contended that a classification that characterised such orders as "non-punitive", simply because they were also disciplinary or regulatory, involved embracing a fiction that was inimical to the text and purposes of the Constitution. Normative functions: Many of the appellants' arguments were addressed to the nature of the functions to be performed by the Board as expressed in s 1292(2). The appellants submitted that inclusion of the adverbs "adequately" and "properly" in par (d) of that sub-section did not deprive the function of a normative legal content. Certainly, many functions vested in Ch III courts under federal legislation are expressed in similarly broad language. Such expressions as "fairly based" in the Patents Act 1990 (Cth)104, "harsh, unjust or unreasonable" in the Industrial Relations Act 1988 (Cth)105 and "reasonably related" in the Civil Aviation Act 1988 (Cth)106 are just three recent instances that spring to mind. Intended operation: Finally, the appellants argued, as they had to, that there was no particular need for a specialist body, including professional or business personnel, to discharge the functions assigned to the Board under s 1292(2) of the Corporations Act. The appellants pointed out that the words "fit and proper person" were familiar ones in the context of the ethics and competence of businesses, trades and professions107. They were well known to courts. The functions were proper to be discharged by courts. 103 Although ordinarily hearings take place in private, a person entitled to appear at a hearing may request that the hearing take place in public: see ASIC Act, s 216(2), (3). Even if the hearing is conducted in private, any orders made by the Board under s 1292 of the Corporations Act are published in the Gazette pursuant to s 1296 of that Act. 104 See Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2004) 217 CLR 105 See Byrne v Australian Airlines Ltd (1995) 185 CLR 410. 106 See Airservices Australia v Canadian Airlines International Ltd (2000) 202 CLR 107 Hughes and Vale Pty Ltd v The State of New South Wales [No 2] (1955) 93 CLR Kirby So much may be granted. However, the question remains whether, when provided as criteria by federal law, particularly in conjunction with the reference in s 1292(2) to the performance of liquidators' duties "adequately and properly", the functions are such that they necessarily involve the exercise of "the judicial power of the Commonwealth" and thus must be vested only in Ch III courts. Or may such powers equally be deployed as the Parliament has here chosen to do? The appellants' arguments are rejected Disposing of the arguments: The appellants' arguments are not persuasive in this instance. Neither separately, nor together, do they constitute a case for confining to Ch III courts the powers exercised by the Board under s 1292(2). So far as history is concerned, as the Full Court pointed out, the origin of the present federal legislative regime for the registration of auditors and liquidators may be traced to the Uniform Companies Acts of 1961. For example, s 9(8) of the Companies Act 1961 (NSW) provided: "[a]ny registered company auditor may apply to the [Companies Auditors Board] for registration as a liquidator". Thereupon, if satisfied about the applicant's "experience and capacity", the Companies Auditors Board was required, on tender of the prescribed fee, to register the person as a registered liquidator108. Irrespective of the early provisions for acting as a company liquidator in the United Kingdom and Australia, and their origins, once registration as an office-holder was introduced into statute law109, such registration became a prerequisite to performing the duties. The entitlement to act as a liquidator was not at large. Appointment was not granted by a court ad hoc subject to the court's discipline and supervision110. Regulation of appointments was no longer discharged simply by the application of the general law of fiduciary duties111. The position comprised a statutory office, created by legislation ultimately applicable throughout Australia. Moreover, the appointment and retention of registration was subject to investigation as required. On proof of discreditable or 108 Companies Act 1961 (NSW), s 9(8). 109 See eg Companies Act 1936 (NSW), s 228(1): "A liquidator appointed by the court may resign or, on cause shown, be removed by the court." 110 cf In re George A Bond and Company Ltd (1932) 32 SR (NSW) 301 at 310. 111 cf Furs Ltd v Tomkies (1936) 54 CLR 583 at 599. Kirby incompetent performance, registered liquidators were subject to sanctions. Initially, those sanctions included admonishment or reprimand; requirement to pay the costs of an inquiry; requirement to give undertakings; imposition of a fine; suspension of registration for a period not exceeding one year; or cancellation of registration and removal of a name from the register112. When, in 1991, the Corporations Law came into operation, the State and Territory disciplinary boards were replaced by a single national board constituted under Pt 11 of the Australian Securities Commission Act 1989 (Cth). Registration remained a prerequisite to the lawful performance of the functions of a liquidator. The only change of substance introduced by the federal Act was the deletion of the power to impose fines or penalties. That deletion was continued in the present Corporations Act113. The history of the determination of earlier legal controversies, factually similar and apparently analogous to a later controversy, can sometimes be useful as indicating a function which, by the Constitution, is reserved, in the case of federal law, to the necessary exercise of the judicial power. Thus, the Commonwealth conceded that under federal law, the adjudication of criminal guilt; the determination of liability under the laws of contracts, tort and trusts114; the imposition of fines; and possibly the contested dissolution of a marriage would comprise a (non-exhaustive) list of functions reserved exclusively to Ch III courts115. In its submission, the powers conferred on the Board by s 1292(2) fell outside any of these "core", or historical, categories. Considerations of the history of Australian companies legislation also tell against the appellants. Once the growth of the economy and its necessities suggested the need for a more systematic and detailed regulation of company liquidators by procedures for administration)116, the establishment of professional disciplinary boards to supervise such registration became a logical and natural development. It might (a proper matter registration involving 112 Companies Act 1961 (NSW), s 9(12). 113 See (2006) 151 FCR 466 at 474 [31]-[34]. 114 cf Bachrach (1998) 195 CLR 547 at 562 [15] referring to Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 706; Brandy (1995) 183 CLR 245 at 258, 115 [2007] HCATrans 005 at 2580, 3036-3038. See also at 3356-3360. 116 A system of licensing or registration of company liquidators was first introduced in Australia by the Companies Act 1934 (SA), s 371 and the Companies Act 1943 (WA), ss 402, 406. Kirby not have been the only way to provide discipline for company liquidators. No doubt courts might have been deployed. However, it offered advantages over the courts of cost saving, speed, flexibility and specialist knowledge. It also offered less publicity and less formality than court proceedings tend to entail. When the Board was established as a federal body, with disciplinary powers, considerations of history did not oblige a different institutional arrangement. When other disciplinary legislation in the federal context accepted by this Court is remembered117, the character of s 1292(2) may be even better understood. Whilst it is true, from the point of view of persons such as the appellants, that an order by the Board suspending their registration as a liquidator for a specified period would doubtless seem to be a kind of public punishment for past conduct judged by the Board to be in breach of the sub-section, on analysis, that is not the true legal character and function of that order118. Legally and functionally, the purpose of the provision is to uphold the standards of registered liquidators; to ensure their compliance with an adequate and proper performance of the duties imposed on company liquidators; to protect company shareholders, creditors, officers and employees, and the public; and to uphold professional and business expectations in that regard. I agree with the analysis in the joint reasons both as to the function which the Board performs and as to the interpretation of s 1292(2)119. I also agree with what is said there concerning intramural or domestic disciplinary arrangements120. It follows that the Board is not engaged in the adjudication or determination of guilt, still less of criminal guilt, or in the imposition of punishment, as such. Nor, having regard to the broad terms of s 1292(2) and the composition of the Board, is it apt to say that the Board is engaged in the enforcement of existing legal rights and duties121. On the contrary, the broad language of the Board's remit invokes the exercise of statutory powers expressed in wide, and deliberately expansive, terms. Doubtless those terms were chosen in the knowledge that the Board, to which the evaluative determination and action was committed, was constituted so as to include members with particular 117 See eg R v White; Ex parte Byrnes (1963) 109 CLR 665; Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 380-381. 118 Southern Law Society v Westbrook (1910) 10 CLR 609 at 625; Kariapper v Wijesinha [1968] AC 717 at 737 (PC); Wigglesworth [1987] 2 SCR 541 at 549. 119 Joint reasons at [17]-[24]. 120 Joint reasons at [32]-[35]. 121 Re Ranger Uranium Mines Pty Ltd; Ex parte Federated Miscellaneous Workers' Union of Australia (1987) 163 CLR 656 at 663-664. Kirby backgrounds and experience, and was not confined to generalist judges. All of these considerations combine to support the rejection of the appellants' arguments that the functions of the Board were such that the Constitution required that they be vested in a Ch III court. A functional check: When the foregoing conclusion is reached, it is appropriate to look back and to check it against the basic objective, reflected in the Constitution, of reserving the exercise of federal judicial power (properly understood) to Ch III courts. In R v Quinn; Ex parte Consolidated Foods Corporation, Jacobs J described the function to be served by this reservation in these terms122: "The historical approach to the question whether a power is exclusively a judicial power is based upon the recognition that we have inherited and were intended by our Constitution to live under a system of law and government which has traditionally protected the rights of persons by ensuring that those rights are determined by a judiciary independent of the parliament and the executive. But the rights referred to in such an enunciation are the basic rights which traditionally, and therefore historically, are judged by that independent judiciary which is the bulwark of freedom. The governance of a trial for the determination of criminal guilt is the classic example." His Honour further expressed the view that "there are a multitude of such instances"123. In his opinion, they were concerned with the determination of what he called "basic legal rights"124. Various questions have arisen in respect of particular, traditionally judicial, functions, such as punishment for contempt, enforcement of orders in the nature of mandamus, or the grant of injunctions125. Whilst it would be contrary to the nature of the constitutional source to close the list or to determine its contents solely by reference to history, it is unconvincing to assert, as the appellants did, that the orders made in their cases required the intervention of courts as "the bulwark of freedom" for the protection of what have been traditionally regarded as "basic legal rights". A decision adverse to the appellants in these appeals cannot therefore be regarded as condoning an intrusion by other governmental powers into the essential functions of Ch III 122 (1977) 138 CLR 1 at 11. 123 (1977) 138 CLR 1 at 11. 124 (1977) 138 CLR 1 at 12. 125 Lane, The Australian Federal System, 2nd ed (1979) at 439-440; Ratnapala at 140; cf Mikasa (NSW) Pty Ltd v Festival Stores (1972) 127 CLR 617 at 630-631, Kirby courts, which the separation of powers doctrine is basically designed to prevent126. On the contrary, what is involved in the appellants' cases is no more than the operation of a disciplinary scheme designed ultimately to uphold standards of integrity and competence in the liquidation of companies. Such a disciplinary scheme involves functions apt to an administrative body. The Board is thus an unremarkable disciplinary institution which, for functional reasons, includes relevant professional and business expertise. The Board cannot enforce its own decisions and its decisions are subject to facilities of administrative review127 of which the appellants have availed themselves128. Structured in a slightly different way, similar functions might possibly have been vested in a Ch III court. But the functions vested in the Board were not of such a character that they required judicial performance. Conclusion and order It follows that the appellants' challenges to the constitutional validity of s 1292(2) of the Corporations Act were rightly dismissed by the Full Court, substantially for the reasons that it gave. As the joint reasons propose, each appeal should be dismissed. 126 The intrusion into the capacities of another constitutional branch of government appears to be the present criterion of the Supreme Court of the United States: District of Columbia Court of Appeals v Feldman 460 US 462 at 479 (1983). 127 See joint reasons at [32]. 128 cf Breckler (1999) 197 CLR 83 at 111-112 [46]-[47], 132-134 [97]-[101]; Luton v Lessels (2002) 210 CLR 333 at 346 [24], 360 [76], 374-375 [127]-[128].
HIGH COURT OF AUSTRALIA SZATV AND APPELLANT MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR RESPONDENTS SZATV v Minister for Immigration and Citizenship [2007] HCA 40 30 August 2007 ORDER Appeal allowed with costs. Set aside the order of the Federal Court of Australia made on 31 October 2005 and in its place order: appeal allowed with costs; and set aside the orders of the Federal Magistrates Court made on 1 August 2005 and in their place order that: (iii) a writ of certiorari issue directed to the Refugee Review Tribunal, quashing its decision made on 30 April 2003; a writ of prohibition issue directed to the Minister, prohibiting the Minister from giving effect to the Refugee Review Tribunal's decision made on 30 April 2003; a writ of mandamus issue directed to the Refugee Review Tribunal, requiring it to determine according to law the application for review made on 23 May 2002; and the Minister pay the applicant's costs. On appeal from the Federal Court of Australia Representation J T Gleeson SC with N J Owens for the appellant (instructed by Corrs Chambers Westgarth) S J Gageler SC with P S Braham and T Reilly for the first respondent (instructed by Australian Government Solicitor) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS SZATV v Minister for Immigration and Citizenship Immigration – Refugees – The appellant was a Ukrainian national who faced persecution in his home region on account of the expression of his political beliefs through journalism – Whether the principle of internal relocation is consistent with the Convention relating to the Status of Refugees – Whether the Refugee Review Tribunal erred in holding that it was reasonable for the appellant to relocate elsewhere in Ukraine – Whether postulated relocation involves denial of fundamental right to free expression of political beliefs protected by Convention. Immigration – Refugees – Well-founded fear of persecution – Whether a well- founded fear of persecution may be confined to a particular region of a country – Whether persecution may reasonably be avoided by relocation – Whether persecution may reasonably be avoided by living "discreetly" – Relevance of practicability – Relevance of territorial distinctions. Words and Phrases – "discreet", "owing to", "practicable", "protection", "refugee", "relocation", "well-founded fear of persecution". Migration Act 1958 (Cth), s 36(2). Convention relating to the Status of Refugees, Art 1A(2). GUMMOW, HAYNE AND CRENNAN JJ. The Facts The appellant was born in 1960 in the city of Chernovtsy, situated in what was then the Union of Soviet Socialist Republics ("the USSR"). Upon the dissolution of the USSR the appellant acquired Ukrainian nationality. Chernovtsy (formerly Czernowitz) is situated in the west of Ukraine, close to the Carpathian mountain range and to the northern border of Romania. In the 19th century it was the chief city of the Bukovina region in the Austro-Hungarian Empire and was developed as an important educational and commercial centre; in 1919, under the Treaty of St Germain it passed to Romania and after World War II to the USSR1. Between 1981 and 1987 the appellant studied at the Chernovtsy State University and in 1987 he qualified as a civil engineer. The appellant married in 1981 and a child of the marriage, a son, was born in 1983. The appellant's wife and son remain in Ukraine. In 1991 the appellant obtained a cadet-journalist position on a newspaper "The Young Bukovinez" and thereafter worked part-time as a freelance journalist. In December 1995 he was accepted as a qualified journalist on a new publication "Chernovtsy-City". In the period that followed the appellant researched and published articles in that newspaper on the subject of government corruption, in particular that of the regime of Theophil Bauer who had been appointed governor of the Chernovtsy region by a decree of the then Ukrainian President Kuchma. The appellant arrived in Australia on 12 June 2001 and on 24 July of that year he lodged an application for a protection (Class XA) visa to be issued pursuant to the Migration Act 1958 (Cth) ("the Act"). A delegate of the Minister (the first respondent in this Court) refused to grant a protection visa and on 30 April 2003 that decision was affirmed by the Refugee Review Tribunal ("the Tribunal") (the second respondent in this Court). The Tribunal Decision The Tribunal accepted, as a serious problem in Chernovtsy, regional government corruption and the willingness of regional government officials to intimidate and to threaten public critics, such as journalists, with serious harm. It "Bukovina", The New Encyclopaedia Britannica, 15th ed (1994), vol 2 at 615-616. Crennan also found that by reason of his political views the appellant had been subjected to "a systematic campaign of harassment" which included physical mistreatment. But in the penultimate paragraph of its reasons, par [81], the Tribunal concluded: "In summary I find that the [appellant] has suffered persecution in the past for the Convention reason of his political opinions. However, I am satisfied that, because the persecution he has suffered is localised to the Chernovtsy region, it is reasonable for the [appellant] to relocate elsewhere in Ukraine. Accordingly, I am not satisfied that his fears of persecution upon his return to Ukraine are well founded." Section 483A of the Act provided that the Federal Magistrates Court had the same jurisdiction as the Federal Court in relation to a matter arising under the Act. With respect to the decision of the Tribunal, the parties accept that the effect of s 483A was to confer upon the Federal Magistrates Court the jurisdiction provided for in s 39B of the Judiciary Act 1903 (Cth) ("the Judiciary Act"). An application to the Federal Magistrates Court by the appellant was dismissed on 1 August 2005, it being held that the complaints he made did not establish a case of jurisdictional error on the part of the Tribunal. An appeal to the Federal Court of Australia was heard by Tamberlin J and dismissed on 31 October 2005. The "Relocation Principle" In this Court, active opposition to the appeal was provided by the Minister. The Tribunal entered a submitting appearance. The appellant identifies as the primary issue the correctness of the "internal relocation principle" which was expounded by the Full Court of the Federal Court in Randhawa v Minister for Immigration, Local Government and Ethnic Affairs2. In Randhawa, after referring to the text of the Convention relating to the Status of Refugees ("the Convention") and in particular to that part of the definition of the term "refugee" in Art 1A(2), Black CJ said3: "Although it is true that the Convention definition of refugee does not refer to parts or regions of a country, that provides no warrant for (1994) 52 FCR 437. (1994) 52 FCR 437 at 440-441. Crennan construing the definition so that it would give refugee status to those who, although having a well-founded fear of persecution in their home region, could nevertheless avail themselves of the real protection of their county of nationality elsewhere within that country. The focus of the Convention definition is not upon the protection that the country of nationality might be able to provide in some particular region, but upon a more general notion of protection by that country. If it were otherwise, the anomalous situation would exist that the international community would be under an obligation to provide protection outside the borders of the country of nationality even though real protection could be found within those borders." The appellant points to the absence from the text of the Convention definition of any reference to relocation to a safe area within the country of nationality or a former habitual residence. He correctly submits that any notion of "relocation" and of the "reasonableness" thereof is to be derived, if at all, as a matter of inference from the more generally stated provisions of the definition. The Convention definition is drawn into Australian municipal law by s 36(2) of the Act. It supplies a criterion for the grant of a protection visa. Provision is now made in the Act by way of further specification of some of the general terms used in the Convention definition of "refugee". Sections 91R and 91S4 are examples. However, no such provision is made respecting any "relocation principle". On the other hand, § 208.13 of the United States Code of Federal Regulations, which is headed "Establishing asylum eligibility", provides in part: "An applicant does not have a well-founded fear of persecution if the applicant could avoid persecution by relocating to another part of the applicant's country of nationality or, if stateless, another part of the applicant's country of the if under all circumstances it would be reasonable to expect the applicant to do so." last habitual residence, Inserted by the Migration Legislation Amendment Act (No 6) 2001 (Cth), Sched 1, Item 5. See VBAO v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 81 ALJR 475; 231 ALR 544; STCB v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 81 ALJR 485; 231 ALR 556. Crennan Further, with respect to the European Union, a Council Directive of 29 April 20045 contains the following as Art 8, with the heading "Internal protection": "1. As part of the assessment of the application for international protection, Member States may determine that an applicant is not in need of international protection if in a part of the country of origin there is no well-founded fear of being persecuted or no real risk of suffering serious harm and the applicant can reasonably be expected to stay in that part of the country. In examining whether a part of the country of origin is in accordance with paragraph 1, Member States shall at the time of taking the decision on the application have regard to the general circumstances prevailing in that part of the country and to the personal circumstances of the applicant. Paragraph 1 may apply notwithstanding technical obstacles to return to the country of origin." But, as indicated above, in Australia any "principle" respecting "internal relocation" must be distilled from the text of the Convention definition, which is applied by s 36(2) of the Act as a criterion for the grant of a protection visa. The critical portion in Art 1A(2) of the Convention definition of "refugee" states that that term shall apply to any person who: "(2) owing to well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion, is outside the country of his nationality and is unable or, owing to such fear, is unwilling to avail himself of the protection of that country; or who, not having a nationality and being outside the country of his former habitual residence ... is unable or, owing to such fear, is unwilling to return to it." Of that provision McHugh and Gummow JJ said in Minister for Immigration and Multicultural Affairs v Khawar6: "This passage presents two cumulative conditions, the satisfaction of both of which is necessary for classification as a refugee. The first 5 Directive 2004/83/EC. (2002) 210 CLR 1 at 21 [61]-[62]. Crennan condition is that a person be outside the country of nationality 'owing to' fear of persecution for reasons of membership of a particular social group, which is well founded both in an objective and a subjective sense7. The second condition is met if the person who satisfies the first condition is unable to avail himself or herself 'of the protection of' the country of nationality. This includes persons who find themselves outside the country of their nationality and in a country where the country of nationality has no representation to which the refugee may have recourse to obtain protection. The second condition also is satisfied by a person who meets the requirements of the first condition and who, for a particular reason, is unwilling to avail himself or herself of the protection of the country of nationality; that particular reason is that well-founded fear of persecution in the country of nationality which is identified in the first condition. The definition of 'refugee' is couched in the present tense and the text indicates that the position of the putative refugee is to be considered on the footing that that person is outside the country of nationality. The reference then made in the text to 'protection' is to 'external' protection by the country of nationality, for example by the provision of diplomatic or consular protection, and not to the provision of 'internal' protection provided inside the country of nationality from which the refugee has departed." (emphasis in original) The applicants for protection visas in Minister for Immigration and Multicultural Affairs v Respondents S152/20038 were Ukrainian nationals. In a joint judgment, Gleeson CJ, Hayne and Heydon JJ said of the Convention definition9: "The immediate context is that of a putative refugee, who is outside the country of his nationality and who is unable or, owing to fear of persecution, unwilling to avail himself of the protection of that country. As explained in Khawar10, we accept that the term 'protection' there refers to the diplomatic or consular protection extended abroad by a county to its 7 Chan v Minister for Immigration and Ethnic Affairs (1989) 169 CLR 379. (2004) 222 CLR 1. (2004) 222 CLR 1 at 8 [19]. 10 (2002) 210 CLR 1 at 10 [21] per Gleeson CJ. See also at 21 [61]-[62] per McHugh Crennan nationals. In the present case, the first respondent must show that he is unable or, owing to his fear of persecution in Ukraine, unwilling to avail himself of the diplomatic or consular protection extended abroad by the State of Ukraine to its nationals. Availing himself of that protection might result in his being returned to Ukraine. Where diplomatic or consular protection is available, a person such as the first respondent must show, not merely that he is unwilling to avail himself of such protection, but that his unwillingness is owing to his fear of persecution. He must justify, not It also is well settled since Chan v Minister for Immigration and Ethnic Affairs11 and Minister for Immigration and Ethnic Affairs v Guo12, that the requirement that the "fear" be "well-founded" adds an objective requirement to the examination of the facts and that this examination is not confined to those facts which formed the basis of the fear experienced by the particular applicant. With these propositions in mind, it will be seen that the matter of "relocation" finds its place in the Convention definition by the process of reasoning adopted by Lord Bingham of Cornhill in Januzi v Secretary of State for the Home Department13. His Lordship said14: "The [Convention] does not expressly address the situation at issue in these appeals where, within the country of his nationality, a person has a well-founded fear of persecution at place A, where he lived, but not at place B, where (it is said) he could reasonably be expected to relocate. But the situation may fairly be said to be covered by the causative condition to which reference has been made: for if a person is outside the country of his nationality because he has chosen to leave that country and seek asylum in a foreign country, rather than move to a place of relocation within his own country where he could have no well-founded fear of persecution, where the protection of his country would be available to him and where he could reasonably be expected to relocate, it can properly be said that he is not outside the country of his nationality owing to a well- founded fear of being persecuted for a Convention reason." 11 (1989) 169 CLR 379 at 389, 396-397, 406, 413, 429. 12 (1997) 191 CLR 559 at 571-572, 596. 14 [2006] 2 AC 426 at 440. Crennan The reference in the passage to the unavailability of the protection of the country of nationality of the refugee is best understood as referring not to the phrase "the protection of that country" in the second limb of the definition, but to the broader sense of the term identified in Respondents S152/200315. This was the international responsibility of the country of nationality to safeguard the fundamental rights and freedom of its nationals. Lord Bingham went on in Januzi16 to refer to the statement in the UNHCR Handbook17, at [91]: "The fear of being persecuted need not always extend to the whole territory of the refugee's country of nationality. Thus in ethnic clashes or in cases of grave disturbances involving civil war conditions, persecution of a specific ethnic or national group may occur in only one part of the country. In such situations, a person will not be excluded from refugee status merely because he could have sought refuge in another part of the same country, if under all the circumstances it would not have been reasonable to expect him to do so." His Lordship, significantly both for Januzi and the present appeal to this "The corollary of this proposition, as is accepted, is that a person will be excluded from refugee status if under all the circumstances it would be reasonable to expect him to seek refuge in another part of the same country." The Submissions The Minister framed the issue, for a situation such as that presented by this appeal, as being whether it be reasonable, in the sense of practicable, for the appellant to relocate to a region where, objectively, there is no appreciable risk of the occurrence of the feared persecution. This formulation does not suffer from 15 (2004) 222 CLR 1 at 8-9 [20]. 16 [2006] 2 AC 426 at 440. 17 UN High Commissioner for Refugees, Handbook on Procedures and Criteria for Determining Refugee Status under the 1951 Convention and the 1967 Protocol relating to the Status of Refugees (1979). 18 [2006] 2 AC 426 at 440. Crennan the defects urged by the appellant. It does not turn upon a "hypothetical assumption", nor does it prevent account being taken of the presence of a subjective fear of persecution, nor does it treat the presence of a "safe area" within the country of nationality as determinative of the existence of a well- founded fear of persecution. However, that does not mean that, without more, the formulation by the Minister is sufficient and satisfactory. What is "reasonable", in the sense of "practicable", must depend upon the particular circumstances of the applicant for refugee status and the impact upon that person of relocation of the place of residence within the country of nationality. It is true that the Convention is concerned with persecution in the defined sense, not with living conditions in a broader sense. The distinction was emphasised by Lord Bingham in Januzi19 as follows: "[T]he thrust of the Convention is to ensure the fair and equal treatment of refugees in countries of asylum, so as to provide effective protection against persecution for Convention reasons. It was not directed (persecution apart) to the level of rights prevailing in the country of nationality." The reasoning in the last sentence might be applied to such matters as differential living standards in various areas of the country of nationality, whether attributable to climatic, economic or political conditions. In Januzi20 Lord Hope of Craighead added: "I too would hold that the question whether it would be unduly harsh for a claimant to be expected to live in a place of relocation within the country of his nationality is not to be judged by considering whether the quality of life in the place of relocation meets the basic norms of civil, political and socio-economic human rights." Nevertheless, in particular cases territorial distinctions may have an apparent connection with the particular reason for the asserted well-founded fear of persecution. There may be instances where differential treatment in matters of, for example, race or religion, is encountered in various parts of the one nation state so that in some parts there is insufficient basis for a well-founded fear of persecution. However, in other cases the conduct or attribute of the individual 19 [2006] 2 AC 426 at 447. 20 [2006] 2 AC 426 at 457. Crennan which attracts the apprehended persecution may be insusceptible of a differential assessment based upon matters of regional geography. The case advanced by the respondent in Khawar21 (which had yet to be tested in the Tribunal) is an example. The respondent's case was that in Pakistan violence against women as a social group was tolerated and condoned, not merely at a local level by corrupt, inefficient, lazy or under-resourced police, but as an aspect of systematic discrimination; this was said to amount to a failure by Pakistan to discharge its responsibilities to protect its female citizens. The proposition that the appellants in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs22 could avoid persecution by living "discreetly" was rejected in the Court, as imposing a false dichotomy between the situation of "discreet" and "non-discreet" homosexual males in Bangladesh. The Tribunal had not asked whether "discretion" was the price to be paid to avoid persecution. McHugh and Kirby JJ said in that regard23: "The Convention would give no protection from persecution for reasons of religion or political opinion if it was a condition of protection that the person affected must take steps – reasonable or otherwise – to avoid offending the wishes of the persecutors. Nor would it give protection to membership of many a 'particular social group' if it were a condition of protection that its members hide their membership or modify some attribute or characteristic of the group to avoid persecution. Similarly, it would often fail to give protection to people who are persecuted for reasons of race or nationality if it was a condition of protection that they should take steps to conceal their race or nationality." In the present case, public expression of political opinion was of particular significance for the appellant by reason of his activities in Chernovtsy as a journalist. The Tribunal appears to have approached his situation on the footing that he might not be able to work as a journalist elsewhere in Ukraine because to do so would be expected to bring upon him further persecution by reason of his political opinions, but this did not make it "unreasonable" for him to "relocate" within Ukraine. This was because as things stood he did not have an anti- 21 (2002) 210 CLR 1 at 11-12 [25]. 22 (2003) 216 CLR 473. cf Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 79 ALJR 1142 at 1143 [1], 1167 [150]-[151]; 216 ALR 1 at 2, 35-36. 23 (2003) 216 CLR 473 at 489 [40]. Crennan government profile generally in Ukraine and might be able to obtain other work not involving the expression to the public of his political opinions. The critical passage in the Tribunal's reasons is in par [79] and reads: "I find that notwithstanding the possible requirements of registration that in the particular circumstances of this case, internal relocation is a realistic option for the Applicant. The Applicant has already shown himself to have the resilience and flexibility to resettle in Australia and find work in this country. He is well educated. While he may not be able to work as a journalist elsewhere in Ukraine I believe that he may be able to obtain work in the construction industry as he has done in Australia. I have already found that the chance of the Applicant being arrested by the SBU [the Ukrainian security service] upon his return to Ukraine is remote. I am also satisfied that he does not have an anti-government political profile generally in Ukraine and would not be of adverse interest to authorities outside the Chernovtsky region." Earlier in its reasons the Tribunal had observed of the appellant it seemed that "[i]f he went back to Ukraine and got work outside journalism ... he would not be at risk of further mistreatment". Counsel for the Minister described this passage as the Tribunal "flirting with error". But later, in par [79], the Tribunal went beyond flirtation. This led to the ultimate conclusions in par [81] respecting the "reasonableness" of relocation in Ukraine. Paragraph [81] has been set out earlier in these reasons. Conclusions The effect of the Tribunal's stance was that the appellant was expected to move elsewhere in Ukraine, and live "discreetly" so as not to attract the adverse interest of the authorities in his new location, lest he be further persecuted by reason of his political opinions. By this reasoning the Tribunal sidestepped consideration of what might reasonably be expected of the appellant with respect to his "relocation" in Ukraine. It presents an error of law, going to an essential task of the Tribunal. This was determination of whether the appellant's fear of persecution was "well-founded" in the Convention sense and thus for the purposes of s 36(2) of the Act. Orders The appellant was entitled to relief of the nature provided by s 39B of the Judiciary Act. The appeal should be allowed with costs and the order of the Federal Court of 31 October 2005 should be set aside. In place thereof, the appeal to the Federal Court should be allowed with costs and the orders of the Crennan Federal Magistrates Court of 1 August 2003 set aside. In place of the costs order made by the Federal Magistrates Court, the Minister should pay the appellant's costs in that Court. In respect of the decision of the Tribunal made 30 April 2003 there should be orders for certiorari to set aside that decision, for prohibition directed to the Minister and for mandamus requiring the Tribunal to reconsider according to law the appellant's application for review made 23 May 2002. Further Proceedings Upon any redetermination by the Tribunal the basic issue will be whether at that time the appellant is a person to whom Australia owes obligations under the Convention, so as to attract s 36(2) of the Act. The Tribunal will exercise afresh its powers and those of the original decision-maker24. Further, in Minister for Immigration and Multicultural and Indigenous Affairs v QAAH of 200425 Gummow ACJ, Callinan, Heydon and Crennan JJ said: "Section 36, like the Convention itself, is not concerned with permanent residence in Australia or any other asylum country, or indeed entitlements to residence for any particular period at all. Its principal concern is with the protection of a person against a threat or threats of certain kinds in another country. Neither the texts nor the histories of the Act and the Convention require that when the threat passes, protection should be regarded as necessary and continuing." 24 Minister for Immigration and Multicultural Affairs v Wang (2003) 215 CLR 518. 25 (2006) 81 ALJR 304 at 314 [36]; 231 ALR 340 at 350. Kirby KIRBY J. In this appeal from the Federal Court of Australia26, the appellant was granted special leave to permit this Court to consider the internal flight or relocation alternative (or principle) in the context of the requirements of the Convention relating to the Status of Refugees, 195127 and the Protocol relating to the Status of Refugees, 196728 (together "the Refugees Convention"). The availability of internal relocation by applicants for "refugee" status under the Refugees Convention has become the subject of much decisional law in countries of refuge29. It has also been the subject of a lot of academic comment30. The United Nations High Commissioner for Refugees ("UNHCR") has published advice helpful to the task of elucidating the contested postulate31. Within countries having legal systems similar to that of Australia, the issue has lately engaged courts of high authority including the House of Lords32, the New Zealand Court of Appeal33 and the Federal Court of Appeal in Canada34. 26 SZATV v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1627 per Tamberlin J, exercising the appellate jurisdiction of the Federal Court of Australia. 27 Done at Geneva on 28 July 1951: 189 UNTS 150; [1954] ATS 5. 28 Done at New York on 31 January 1967: 606 UNTS 267; [1973] ATS 37. 29 See European Council on Refugees and Exiles, Research Paper on the Application of the Concept of Internal Protection Alternatives (2000) ("Research Paper"). The Research Paper sets out decisions in eighteen countries, including Australia. 30 Eg Goodwin-Gill and McAdam, The Refugee in International Law, 3rd ed (2007) at 123 [5.61]; Hathaway and Foster, "Internal protection/relocation/flight alternative as an aspect of refugee status determination" in Feller et al (eds) Refugee Protection in International Law: UNHCR's Global Consultations on International Protection, (2003) at 357-417 ("Hathaway and Foster"); Storey, "The Internal Flight Alternative Test: The Jurisprudence Re-examined", (1998) 10 International Journal of Refugee Law 499. 31 United Nations High Commissioner for Refugees (UNHCR), Interpreting Article 1 of the 1951 Convention Relating to the Status of Refugees (2001). 32 Januzi v Home Secretary [2006] 2 AC 426. See also E v Home Secretary [2004] QB 531 (CA); R v Home Secretary; Ex parte Robinson [1998] QB 929. 33 Butler v Attorney-General [1999] NZAR 205. 34 Ranganathan v Canada (Minister of Citizenship and Immigration) [2001] 2 FC 164; Thirunavukkarasu v Canada (Minister of Employment and Immigration) (1993) 109 DLR (4th) 682. Kirby In expressing Australian law on this subject it has been useful to examine these legal sources. Because they all address, ultimately, the Refugees Convention and its requirements, it is obviously desirable to attempt the expression of a consistent approach. Although there have been differences of detail in the exposition, the existence of a relocation alternative or principle in some form is now generally accepted. I agree in the orders proposed in the reasons of Gummow, Hayne and Crennan JJ ("the joint reasons")35. As will appear, to a substantial degree, I concur in the reasoning that lies behind those orders. However, because I come to my conclusions in a somewhat different way, I will express them in these separate reasons. The facts The starting point is a need to get a little more of the flavour of the circumstances into which the Refugee Review Tribunal ("the Tribunal") injected what I shall call the "relocation test". I use that expression in preference to "relocation principle"36 because, as I shall show, the test has a somewhat fragile footing in the text of the Refugees Convention itself. The introduction of the test into decision-making in refugee cases has become extremely common. In a sense, every time a refugee applicant leaves a country of nationality that is large (or even middling) in size, a question now appears to be presented as to whether the claim to refugee status should be rejected on the footing that the applicant could have moved elsewhere in the country of nationality rather than looking for surrogate protection from the country of refuge. The background facts are stated in the joint reasons37. However, it is useful to appreciate the extent to which the Tribunal accepted the "key claims" of the appellant, SZATV38. He was generally found to have been a credible witness. The Tribunal recorded that he had worked for several years in Ukraine 35 Joint reasons at [33]. See also reasons of Callinan J at [108]. 36 Joint reasons at [9]. 37 Joint reasons at [1]-[5]. 38 The name has been anonymised in accordance with s 91X of the Migration Act 1958 (Cth) ("the Act"). Kirby as a freelance journalist, ultimately graduating to full-time work on a newspaper in Chernovtsy, the city in which he was born, educated and lived39. Before the middle of July 2000 there had been a number of objections to articles which the appellant had written about corruption in government. One of these articles, published in July 2000, criticised the regional Governor for corruption. In the result, both the editor of the newspaper and the appellant were singled out for threats. The appellant was publicly abused by the Governor and received a telephone call from the Deputy Governor in which he was "brazenly threatened … with death if he continued to write articles critical of the regional administration"40. There followed anonymous callers threatening "trouble"; a search of the appellant's apartment and office; an incident in which he was bashed; and warnings to his wife that her employment was in danger. In May 2001 the appellant was also summoned troubling the development. He departed for Australia in June 2001. local police station, a The Tribunal accepted independent country information to the effect that "despite the fact that the Constitution of Ukraine and a 1991 law provide for freedom of speech and the press the government does not respect these rights … [S]everal journalists have been murdered and a number have suffered serious injuries in assaults, all of which may have been politically motivated."41 The Tribunal also accepted that the governmental authorities in Ukraine "interfere with news media by intimidating journalists"; pressure journalists to apply self- censorship; and utilise defamation law to silence critics. Specifically, the Tribunal "accept[ed] both the willingness of regional government officials to intimidate and threaten with serious harm The Tribunal acknowledged that registration for social benefits and employment was still unofficially required in Ukraine, as in Soviet days, despite a court ruling that it was illegal43. Nevertheless, without evaluating the extent, nature and precise causes of the "fear" claimed by the appellant as the reason for his departure from Ukraine to Australia (and whether such fear was otherwise "well-founded" within that regional government corruption and is a serious problem in Chernovtsky"42. 39 Refugee Review Tribunal, decision and reasons of the Tribunal, 30 April 2003 ("Reasons of the Tribunal") at [3], [64], [66]. 40 Reasons of the Tribunal at [66]. 41 Reasons of the Tribunal at [67]. 42 Reasons of the Tribunal at [69]. 43 Reasons of the Tribunal at [78]. Kirby the meaning of the Refugees Convention), the Tribunal turned, in the concluding and decisive three paragraphs of its reasons, to the relocation test which proved decisive for its decision. Discussing this issue, the Tribunal said44: "I find that notwithstanding the possible requirements of registration that in the particular circumstances of this case, internal relocation is a realistic option for the Applicant. The Applicant has already shown himself to have the resilience and flexibility to resettle in Australia and find work in this country. He is well educated. While he may not be able to work as a journalist elsewhere in Ukraine I believe that he may be able to obtain work in the construction industry as he has done in Australia. I have already found that the chance of the Applicant being arrested by the SBU [security police] upon his return to Ukraine is remote. I am also satisfied that he does not have an anti-government political profile generally in Ukraine … [T]he Applicant has suffered persecution in the past for the Convention reason of his political opinions. However, I am satisfied that, because the persecution he has suffered is localised to the Chernovtsky region, it is reasonable for the Applicant to relocate elsewhere in Ukraine. Accordingly, I am not satisfied that his fears of persecution upon his return to Ukraine are well-founded." It was on this basis only that the appellant's claim for a protection visa as a "refugee" was rejected. The Federal Magistrates Court (Nicholls FM) on an application for judicial review found no error45. The Federal Court affirmed that decision46. Now by special leave the matter is before this Court. The legislation and the Refugees Convention The Refugees Convention is introduced into Australian municipal law by s 36(2) of the Migration Act 1958 (Cth) ("the Act") providing for protection visas. To be entitled to such a visa an applicant must fall within Article 1A(2) of the Refugees Convention. This defines a "refugee" as any person who: "owing to well-founded fear of being persecuted for reasons of … political opinion, is outside the country of his nationality and is unable or, owing to such fear, is unwilling to avail himself of the protection of that country; or who, not having a nationality and being outside the country of his former 44 Reasons of the Tribunal at [79]-[81]. 45 [2005] FMCA 935. 46 [2005] FCA 1627. Kirby habitual residence, is unable or, owing to such fear, is unwilling to return to it." The Refugees Convention contains no express exception from the stated protection obligations for a case where a refugee applicant might reasonably relocate to a safe district or place within the country of nationality or habitual residence. Nor is there any such provision in the Act47. Neither is there any regional directive48 or regional treaty49 applicable to Australia's protection obligations under the Refugees Convention. The travaux préparatoires which describe the drafting history of the Refugees Convention do not suggest that the attention of the drafters was at any stage directed to a relocation test50. It does not appear that specific consideration was given to an exception for the possibility of safe relocation within the country of nationality or habitual residence ("country of nationality")51. The premise upon which, at first, it was assumed that the Refugees Convention would operate was that, if a serious risk of harm to the refugee applicant was established anywhere in the country of nationality, that meant that a failure of protection had occurred, justifying the departure from that country to claim surrogate protection from another country and a continuing well-founded fear of return52. 47 Compare in this respect the United States Code of Federal Regulations. See joint reasons at [13]. 48 Compare European Union, Council Directive 2004/83/EC. See joint reasons at 49 Organisation of African Unity, Convention Governing the Specific Aspects of Refugee Problems in Africa, 1001 UNTS 45, Art 2. This provision extends the definition of "refugee" in African State parties as "every person who, owing to external aggression, occupation, foreign domination or events seriously disturbing public order in either part or the whole of his country of origin or nationality is compelled to leave his place of habitual residence in order to seek refuge in another place outside his country of origin or nationality" (emphasis added). See Hathaway, "International Refugee Law: The Michigan Guidelines on the Internal Protection Alternative", unpublished paper (1999). 50 de Moffarts, summarised in European Council on Refugees and Exiles, Research Paper at 11. 51 See eg European Council on Refugees and Exiles, Research Paper at 10. 52 Hathaway and Foster at 359. Kirby The internal relocation issue only began to emerge in earnest in the mid-1980s. According to Professor Hathaway and Dr Foster, recognised experts on the Refugees Convention, it was at about that time that the typical type of person, claiming protection as a refugee, began to change53. Whereas earlier many such persons were those who had fled from communist countries, by the 1980s, a "different" type of applicant was appearing. This applicant was more likely to be from a country that was "politically, racially, and culturally 'different'" from the country in which he or she sought refuge54. It was in the foregoing historical context that refugee adjudicators and national governments looked again at the Refugees Convention to see whether it would yield a stable "principle" or test to differentiate "genuine" refugees, who complied with the Refugees Convention definition, from others who did not. It was this quest that led to a number of suggested textual bases upon which to found a consideration of the relocation hypothesis. Each of the three textual foundations propounded presents difficulties. Yet unless a convincing, or at least acceptable, textual foundation can be identified for a relocation test, courts of law should not accept the notion. They should leave it to the States parties to the Refugees Convention to re-negotiate its terms to provide explicitly the exception which, on this view, has crept into State practice in order to afford a ground for rejecting "different" refugee applicants, said to fall outside the original purpose of the Refugees Convention yet claimed to come within its present language. The textual foundations for a relocation test Three possible approaches: Other courts have analysed the propounded exception for the reasonable possibility of relocation within the country of nationality. They have identified the different consequences of choosing amongst the possible textual foundations55. In the past, two main theories have emerged to sustain the relocation test. Argument in this appeal has suggested a third possible theory: The words "owing to": The first (and new) textual thesis latches onto the words "owing to" in the definition of "refugee" (above). If, although 53 Hathaway and Foster at 359. 54 Hathaway and Foster at 359-360. 55 Januzi [2006] 2 AC 426 at 441-442 [9] per Lord Bingham, 463 [65] per Lord Carswell; cf E [2004] QB 531 at 541 [16] per Lord Phillips of Worth Matravers MR. Kirby immaterial to" some extrinsic exhibiting "fear", the refugee applicant is outside the country of nationality or habitual residence not "owing to" the propounded fear but the Refugees reason, "owing Convention's purposes, the definition is not engaged. Thus, if the applicant is simply seeking to improve his or her economic, social or humanitarian condition, the Refugees Convention definition will not be attracted. A practical test for such a case might be whether the applicant has failed, or refuses, to select the most proximate, economic and available solution to relieve the propounded "fear", by moving elsewhere in the country of nationality. A failure to select that option, or to reclaim it whilst outside the country of nationality would, on this thesis, demonstrate that the claim for refugee status was unfounded and should be rejected; The words "protection of the country": The second textual thesis, which enjoys much support in legal writing56 and in some court decisions57, fixes on the closing words of the defined categories of forbidden persecution. It concerns itself with the inability or unwillingness of the applicant to "avail himself of the protection of [the] country" of nationality. Thus, it initiates a search to discover whether, in fact, there is the inability or unwillingness to claim "the protection" of the country within the entirety of its geographical boundaries. If within that country, its "protection" could be obtained, simply by moving somewhere else, inability or unwillingness would not be an inability or unwillingness of the kind contemplated by the Refugees Convention definition but one that must be based on some other, extraneous, motivation, such as economic, social or humanitarian advancement; and the The words "well-founded": The third textual thesis is said to lie in the requirement that the "fear" of persecution, justifying the obligation of protection by the country of refuge, must be "well-founded". The requirement of "well-foundedness" introduces an objective standard. According to this third approach, "well-foundedness" of the claimed "fear" will be objectively missing (whatever any subjective state) where the persecutory source of the "fear" could reasonably be avoided by returning to the country of nationality and moving somewhere else within that country. A failure or unwillingness to do so, in such circumstances, would demonstrate the fact that the refugee applicant remains "outside the country" of nationality on some basis other than a "well-founded" fear, as 56 Eg Hathaway, The Law of Refugee Status (1991), 134. 57 Eg Butler v Attorney-General [1999] NZAR 205 at 214 (Court of Appeal) per Kirby defined. This would be so because the simpler and more rational expedient of looking to the country of nationality for protection would otherwise have been embraced before, or rather than, claiming such protection from another country. After all, the "surrogate" protection by another country, as envisaged by the Refugees Convention, is an exception to the normal principle of international law that protection is usually the obligation of the individual's country of nationality. Disregarding two hypotheses: For the purposes of this appeal, two of the foregoing theses can be disregarded by this Court. First, a reliance on "owing to" would introduce barren arguments about causation. Such arguments bedevil the law. They should be avoided wherever possible58. To classify a claim to refugee status as falling outside the Refugees Convention definition because not "owing to" fear of being persecuted for Refugees Convention reasons begs the very question that the Refugees Convention definition is designed to answer. It is difficult enough to discern any implied, or inherent, foothold in the text of the definition to sustain the internal relocation test. The first textual thesis is unconvincing. Much more attractive is the suggested attention to the inability or unwillingness of the refugee applicant "to avail himself of the protection of that country", ie the country of nationality. On the face of things, this explanation of the relocation principle appears to present the most convincing textual foundation for the propounded "exception". Moreover, it does so by giving content to words that seem to lie at the heart of the purposes of the Refugees Convention, namely protection of a refugee applicant. Thus, if it were the case that such an applicant were "unable or … unwilling to avail himself of the protection of [the] country [of nationality]" because, throughout that country an adequate level of protection was missing, the hypothesis of the Refugees Convention would be fulfilled. Its text would be engaged. On the other hand, if, in some parts of the country of nationality, that country was perfectly able and willing to provide internal "protection" to the putative refugee, the propounded inability or unwillingness of that person to avail himself or herself of such (localised) "protection of that country" would not sustain the asserted "fear". Thus, if the country concerned were able to afford protection, albeit in a different town, district or region, the basis for the necessary unwillingness or inability would be knocked away. This is the preferred explanation adopted for the relocation test by Professor Hathaway and Dr Foster59. 58 cf Chappel v Hart (1998) 195 CLR 232 at 268 [93]. 59 Hathaway and Foster at 358-359. Kirby So far as Australian law is concerned, a real difficulty is presented for this second textual support for relocation. It appears in two decisions of this Court, mentioned in the joint reasons60. In those decisions, this Court appears to have decided that the term "protection", in the Refugees Convention definition, is a reference to "diplomatic or consular protection" extended abroad by a country to its nationals61. In Minister for Immigration and Multicultural Affairs v Khawar62 it is said specifically that "protection" is not "the provision of 'internal' protection provided inside the country of nationality from which the refugee has departed". Although that view enjoys some support in academic writing63, it has been strongly criticised, including by Professor Hathaway and Dr Foster. They describe it as an attempt "to force a narrow, decontextualised reading of 'protection' onto the 1951 Convention"64. They assert that understanding "protection" within the Refugees Convention definition as limited to "diplomatic protection" outside the country of nationality or habitual residence is "out of step with most contemporary pronouncements of UNHCR as manifested in its official documents … materials and interventions in domestic adjudication."65 Professor Hathaway and Dr Foster also cite a great deal of judicial and other writing, including the reasons of Black CJ in Randhawa v Minister for Immigration, Local Government and Ethnic Affairs66, which has hitherto been followed routinely in such cases by Australian judges and refugee claim adjudicators. The hypothesis on which those reasons were written was that the applicable consideration for deciding "refugee" status was the availability of domestic "protection" in the country of nationality rather than the availability of diplomatic protection abroad. Overseas courts have not followed this Court's view of the meaning of "protection" in this context67. In my view, this Court 60 Joint reasons at [16]-[17] citing Minister for Immigration and Multicultural Affairs v Khawar (2002) 210 CLR 1 at 21 [61]-[62]; Minister for Immigration and Multicultural Affairs v Respondent S152/2003 (2004) 222 CLR 1 at 8 [19]. 61 Khawar (2002) 210 CLR 1 at 21 [62]. 62 (2002) 210 CLR 1 at 21 [62]. 63 Eg Fortin, "The Meaning of 'Protection' in the Refugee Definition", (2000) 12 International Journal of Refugee Law 548. 64 Hathaway and Foster at 380. 65 Hathaway and Foster at 379-380 (footnotes omitted). 66 (1994) 52 FCR 437 at 440-442. See joint reasons at [10]. 67 Eg Januzi [2006] 2 AC 426 at 463 [66] per Lord Carswell. Kirby should reconsider its holding in this respect. The contrary view appears more persuasive. Moreover, it is one more relevant to the central purposes of the Refugees Convention. It is also more relevant to the issue under consideration in this appeal. Nevertheless, until this Court reconsiders what it has said about the meaning of "protection" in the Refugees Convention, I should follow and apply the stated rule. In this condition of the law in Australia, the only possible textual basis left to afford a foundation for the suggested relocation test, is thus the notion of "well-foundedness". Test of well-foundedness: To derive from the requirement that a refugee applicant's fear of persecution upon specified grounds must be "well-founded" an implication that, if it is reasonable for the refugee applicant to move to a different town, district or region of the country of nationality, the fear will not be well- founded, puts a great deal of strain on the language of the Refugees Convention. Effectively, this approach imports an exception or qualification upon the Refugees Convention definition for a policy reason, one which did not really emerge to significance in the international community until the 1980s. It obliges courts and refugee adjudicators to rewrite and qualify the Refugees Convention definition of "refugee". Nevertheless, this is certainly the way the relocation rule has now been imported into judicial and Tribunal decisions in this country. It has happened not without some cogent criticism that approaching the problem presented by the Refugees Convention in this way involves building an edifice of reasoning on a very scant textual foundation68. I understand this criticism. However, ultimately, I would not accept it, at least in the circumstances of this case and in the light of the past authority of this Court to which I have referred. The general acceptance of a relocation test The critics: A number of international writers have criticised the foregoing development of the relocation test or "principle". Amongst them, Gaetan de Moffarts69 has disputed the existence of any internal protection test as one incongruous with the text of the Refugees Convention and the views of its drafters. According to de Moffarts, it is a basic assumption of the Refugees Convention that, if some part of the territory of the country of nationality is such as to give rise to a Refugees Convention related "fear", it is the obligation of the national government concerned to remove the source of such fear by providing 68 Germov and Motta, Refugee Law in Australia, (2003) at 389-398; cf Vrachnas et al, Migration and Refugee Law, (2005) at 260-262. 69 See European Council on Refugees and Exiles, Research Paper at 11 [7.3]. Kirby effective protection nation-wide. That obligation, it is said, derives from the duty of a national government to provide security for its nationals everywhere within its borders. Within such a country, a national is ordinarily entitled by international human rights law to move about without hindrance. According to such critics, in light of the Refugees Convention criteria of persecution, the country of refuge, in respect of which the "fear" of return is demonstrated, should normally not be entitled to avoid its obligations by demanding that an applicant should have responded, or now respond, to such "fear" in some other and different way. Thus, the Refugees Convention, on this view, envisages the possibility of dual or multiple responses to such a "fear". If the fear is genuine, and is proved on both an objective and subjective basis, the duty of the country of refuge is sufficiently established. This is no less so because there might be additional and different obligations imposed by international law on other countries, including the country of nationality, were the refugee applicant to invoke their protection. Critics within Australia have fastened on the textual difficulty of deriving the relocation test from the consideration of well-foundedness, given that "the crucial consideration is whether [the refugee applicants] are outside their country owing to a well-founded fear of Convention-related persecution"70. Necessarily, "every applicant for refugee status has already made the ultimate relocation – to another country in order to claim refugee status"71. The question then presented is concerned with a "fear" said already to have existed. Any investigation of the "reasonableness of the relocation" at some later time cannot be justified unless it is demonstrated that it is specifically relevant to whether the fear was "well- founded" when it arose, occasioning the applicant's flight. At that moment, internal relocation may never have been considered. Yet the purpose of the relocation test is apparently to demand its consideration before making requests for refugee protection upon the chosen country of refuge. Vigorous criticisms can obviously be addressed to the formulation of particular rules of thumb, which are then applied by refugee claim adjudicators and courts as if they were part of the Refugees Convention definition. Unless such rules are expressed in valid municipal legislation or in other binding rules of law, the introduction of a test such as "would it be unduly harsh to expect this person … to move to another less hostile part of the country"72 or "would it be 70 Germov and Motta, Refugee Law in Australia (2003), 396. 71 Germov and Motta, Refugee Law in Australia (2003), 397. 72 Thirunavukkarasu (1993) 109 DLR (4th) 682 at 687 per Linden JA. This was followed in Ex parte Robinson [1998] QB 929. Kirby This reasonable to expect such a move?" tend to take on a life of their own in mass jurisdiction decision-making. in part, because of perceived administrative necessity and an understandable desire for consistency. However, it obviously involves a danger of forgetting the need for a link to the text of the Refugees Convention, said here to derive from the notion of well-foundedness. Keeping that link in mind, and applying it, is essential to ensure that the decision- maker never loses sight of the protective purposes of the Refugees Convention and does not read into its provisions qualifications, limitations and exceptions that are not there. Introduction of relocation test: I appreciate fully all of the foregoing criticisms. However, it cannot now be doubted that, both in widespread State practice and in the understanding of the office of UNHCR, formulations of the relocation test have come to be generally accepted. The inclusion in 1979 in the UNHCR Handbook on the Refugees Convention of par 9173 was doubtless intended to act as a limitation or check upon the over-reach of any relocation test. However, in the way Lord Bingham of Cornhill explained in Januzi v Home Secretary74, the corollary of the principle there stated, to avoid the misuse of the postulate of internal relocation, is that the reasonable possibility of relocation is accepted as a proper consideration. Importantly, whilst not embracing this Court's approach that "protection" is a reference to diplomatic protection abroad, the House of Lords in Januzi clearly found the textual source of a relocation rule in the requirement that refugee status has to be based on a well-founded fear of persecution. Their Lordships explain that, if the applicant could reasonably be expected to relocate to a place within the country of nationality where there is no fear of persecution and where protection is available, then he or she could not be said to be outside the country of origin "owing to a well-founded fear". No well- founded fear will then explain an unwillingness or inability on the part of the applicant to claim protection from the country of nationality which is the primary and natural provider of such protection75. 73 Handbook on Procedures and Criteria for Determining Refugee Status under the 1951 Convention and the 1967 Protocol Relating to the Status of Refugees, (1979; revised in 1992). Set out in joint reasons at [21]. 74 [2006] 2 AC 426 at 440. See joint reasons at [22]. 75 [2006] 2 AC 426 at 440 [7] per Lord Bingham; cf Goodwin-Gill and McAdam, The Refugee in International Law, 3rd ed (2007) at 125-126. Kirby The main point of Januzi was to cut back, for the United Kingdom, a view expressed in some of the earlier cases and commentaries, that the protection of the country of refuge extended not only to protection from the sources of Refugees Convention-related persecution but also to protection from other human rights violations and deprivations. In harmony with the way the relocation test has been grafted onto the Refugees Convention, Januzi was expressed to take decision-makers back to the text and to the Refugees Convention's purpose to provide a protection against specified persecution and nothing else. Growing State practice: There is a further basis for supporting a relocation test, so explained. Whatever the legitimacy of the early criticisms of the expansion of a type of exception for the possibility of relocation within the country of alleged persecution, the fact is that, in a comparatively short period, widespread State practice has now embraced the notion of a disqualifying alternative expressed in terms of the reasonableness of internal relocation in the country of nationality. A report by the European Council on Refugees and Exiles76 collects the practice of many States. This practice is evidenced in numerous court and tribunal decisions in fourteen European nations as well as in Australia, New Zealand, Canada and the United States of America. Although differences exist in the way the internal relocation test is expressed, explained and applied, there is a high level of acceptance of the hypothesis in one form or another. A feature of this outcome, in countries of common refuge, is the reliance on the recognition by UNHCR itself of the existence of some such rule and also by most of the leading scholars expert in this field. Thus, UNHCR in 2003 published detailed guidelines77, specific to the topic of the "Internal flight or relocation alternative" within the context of the Refugees Convention definition. These Guidelines conclude with the observation78: "The question of whether the claimant has an internal flight or relocation alternative may … arise as part of the holistic determination of refugee status. It is relevant only in certain cases, particularly when the source of persecution emanates from a non-State actor. Even when relevant, its 76 European Council on Refugees and Exiles, Research Paper. 77 UNHCR, Guidelines on International Protection: "Internal Flight or Relocation Alternative" within the Context of Article 1A(2) of the 1951 Convention and/or 1967 Protocol Relating to the Status of Refugees, (2003) ("Guidelines"). 78 UNHCR, Guidelines at 8 [38]. Kirby applicability will depend on a full consideration of all the circumstances of the case and the reasonableness of relocation in another area in the country of origin." International practice: Against the background of this strong, largely consistent national and international practice and the qualified acceptance of its legitimacy by UNHCR itself, it would be impossible and undesirable for this Court to deny this development in Australia alone. On legal questions of this kind, national courts and tribunals must inform themselves of relevant international developments. Having done so — as I have attempted to do in these reasons — in the absence of some peculiar local legal basis for departure, they should seek to reflect the international approach in their own municipal decisions. The operation of the internal relocation rule Viewing relocation in context: The conclusion of UNHCR, just quoted, indicates, to my mind, the correct way in which an accurate application of the Refugees Convention (and hence, in Australia, of s 36(2) of the Act) will be achieved by refugee claim adjudicators, the Tribunal and the courts. In each case it is necessary to keep in mind the purpose, under the Refugees Convention, for which the reasonable possibility of relocation is being considered. It is not a free-standing prerequisite to individual entitlements under the Refugees Convention. Those entitlements arise on the refugee applicant's establishing a presence outside the country of nationality owing to a well- founded fear of being persecuted for Refugees Convention reasons. The postulated capacity to relocate is only relevant insofar as it casts light on the question whether the reason for being outside the country of nationality is a "well-founded" fear of the risk of persecution. A propounded "fear" might not be classified as "well-founded" if, instead of seeking protection from Australia, it would be reasonable for the applicant to rely on his or her country of nationality to afford the protection at home by the simple expedient of moving to another part of the country, free of the risk of persecution. Ways of testing reasonableness: By definition, an applicant for refugee status is a person who has made the application for protection outside the country of nationality. Flight to the country of refuge, and the necessity of building a new life there (generally starting with few, if any, assets and with various disadvantages), ordinarily indicates that the refugee applicant will have accepted as tolerable risks and burdens of external relocation. But would not the prospect of internal relocation always be more reasonable and thereby exclude the requirement of external protection where internal relocation was or is a reasonable option? Kirby A review of the literature suggests that this conclusion will not invariably follow, either as a matter of fact or law. Thus, internal relocation will not be a reasonable option if there are logistical or safety impediments to gaining access to the separate part of national territory that is suggested as a safe haven79. Nor if the evidence indicates that there are other and different risks in the propounded place of internal relocation80; or where safety could only be procured by going underground or into hiding81; or where the place would not be accessible on the basis of the applicant's travel documents or the requirements imposed for internal relocation82. An inability or unwillingness on the part of the national authorities to provide protection in one part of the country may make it difficult to demonstrate durable safety in another part of that country83. In some circumstances, having regard to the age of the applicant, the absence of family networks or other local support, the hypothesis of internal relocation may prove unreasonable84. In each case, the personal circumstances of the applicant85; the viability of the propounded place of internal relocation86; and the support mechanisms available if an applicant has already been traumatised by actual or feared persecution87, will need to be weighed in judging the realism of the hypothesis of internal relocation. Variable country information: In the nature of things, country information available to refugee adjudicators is often expressed at a high level of generality. It may not extend in sufficient detail to establish, in a convincing way, the differential safety of other towns, districts or regions of the one country. The fact 79 European Council on Refugees and Exiles, Research Paper at 8-9. 80 The Michigan Guidelines on the Internal Protection Alternative, agreed to at the First Colloquium on Challenges in International Refugee Law, 9-11 April 1999, at 81 Hathaway and Foster at 384-385. 82 Hathaway and Foster at 391. 83 Hathaway and Foster at 383. 84 Hathaway and Foster at 386-387. 85 UNHCR, Guidelines at 6 [25]. 86 European Council on Refugees and Exiles, Research Paper at 12 [8.1], 52. 87 UNHCR, Guidelines at 6 [26]. Kirby that in Australia the inquiry is relevant only to the well-foundedness of the fear of persecution on the part of the refugee applicant indicates that, where otherwise a relevant "fear" is shown, considerable care will need to be observed in concluding that the internal relocation option is a reasonable one when, by definition, the applicant has not taken advantage of its manifest convenience and arguable attractions. Individual assessment and acting discreetly The issue in S395/2002: The appellant mounted a two-pronged attack on the decision of the Tribunal in the present case, based on the reasoning of the majority of this Court in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs88 ("S395"). That case was decided after the Tribunal delivered the decision now in question89. The Tribunal did not, therefore, have the advantage of this Court's analysis. S395 involved a claim to refugee status by two homosexual men from Bangladesh who complained of a well-founded fear of persecution for reason of their membership of a "particular social group", namely stigmatized homosexuals in that country. The Tribunal had rejected the claim on the basis of its finding that the applicants would "live discreetly" if they were returned to Bangladesh. As such, they would not be persecuted. The majority of this Court found that the Tribunal had erred in the exercise of its jurisdiction by failing to consider whether there was a real chance that the applicants would in fact suffer serious harm if they were returned and if people in Bangladesh found that they were homosexual. The majority decided that refugee applicants were not required to take reasonable steps to avoid persecutory harm if this involved them in a denial of the basic rights to freedom from persecution which the Refugees Convention is designed to uphold and safeguard. In this appeal, the appellant had two complaints in the light of the decision in S395. First, he argued that the Tribunal had failed to address the question, mandated by S395, of how and where, in fact he would be likely to live if returned to the country of his nationality. He argued that, instead, the Tribunal had avoided that essential question by superimposing a propounded obligation to act reasonably, as by relocating to another part of Ukraine. Alternatively, if this error of general approach were not established, the appellant argued that a specific jurisdictional error had occurred by the Tribunal's hypothesising not only that he should relocate in Ukraine but that he would change his occupation there 88 (2003) 216 CLR 473. 89 The Tribunal's decision is dated 30 April 2003. It was handed down on 22 May 2003. S395 was decided on 9 December 2003. Kirby and thereby submit to the very type of persecution which the Refugees Convention was designed to prevent, discourage and, where it occurred, redress. The holding in S395: It was a common theme of the two joint reasons in S395 that the Tribunal, in that case, had committed jurisdictional error by superimposing an hypothesis that the applicants would continue to "act discreetly", on the basis that this was the reasonable way of avoiding persecution as homosexuals in Bangladesh90. The error in that case lay in classifying members of the "social group" in question as between those who would act "discreetly" and those who might not. Moreover, the error lay in failing to consider how the applicants in that case would in fact act and whether such conduct would involve a real chance of persecution on one or more of the Refugees Convention grounds. The importance of the Tribunal's addressing its attention to the way in which the particular applicant would act in fact, if returned to the country of nationality, was emphasised in both of the joint reasons in S39591. Thus, McHugh J and I said92: "The notion that it is reasonable for a person to take action that will avoid persecutory harm invariably leads a tribunal of fact into a failure to consider properly whether there is a real chance of persecution if the person is returned to the country of nationality. This is particularly so where the actions of the persecutors have already caused the person affected to modify his or her conduct by hiding his or her religious beliefs, political opinions, racial origins, country of nationality or membership of a particular social group. In cases where the applicant has modified his or her conduct, there is a natural tendency for the tribunal of fact to reason that, because the applicant has not been persecuted in the past, he or she will not be persecuted in the future. The fallacy underlying this approach is the assumption that the conduct of the applicant is uninfluenced by the conduct of the persecutor and that the relevant persecutory conduct is the harm that will be inflicted. In many … cases, however, the applicant has acted in the way that he or she did only because of the threat of harm … To determine the issue of real chance without determining whether the 90 (2003) 216 CLR 473 at 487 [34]-[35] per McHugh and Kirby JJ, 501 [82] per 91 S395 (2003) 216 CLR 473 at 490-491 [43]-[44], 494-495 [57] per McHugh and Kirby JJ, 500 [78], 501 [83] per Gummow and Hayne JJ. 92 (2003) 216 CLR 473 at 490-495 [43]-[58] per McHugh and Kirby JJ (emphasis in original). See also at 501 [82] per Gummow and Hayne JJ. Kirby modified conduct was influenced by the threat of harm is to fail to consider the issue properly … The central question is always whether this individual applicant has a 'well-founded fear of being persecuted for reasons of … membership of a particular social group'." In their joint reasons in S395, Gummow and Hayne JJ likewise emphasised the need to consider whether, in fact, the particular applicant would be exposed to the real chance of persecution if the applicant were returned to the country of nationality93: "The central question in any particular case is whether there is a well-founded fear of persecution. That requires examination of how this applicant may be treated if he or she returns to the country of nationality. Processes of classification may obscure the essentially individual and fact- specific inquiry which must be made. Addressing the question of what an individual is entitled to do (as distinct from what the individual will do) leads on to the consideration of what modifications of behaviour it is reasonable to require that individual to make without entrenching on the right. This type of reasoning … leads to error … [The Tribunal] did not ask whether the appellants would live "discreetly" because that was the way in which they would hope to avoid persecution. That is, the Tribunal was diverted from addressing the fundamental question of whether there was a well-founded fear of persecution by considering whether the appellants were likely to live as a couple in a way that would not attract adverse attention." It follows that the common ground in the two joint majority reasons in S395 was the need for the decision-maker to focus attention on the propounded fear of the individual applicant and whether it was "well-founded"; to consider that issue on an individual basis and not, for example, by reference to a priori reasonable conduct that could or might avoid persecution; and to concentrate on what would happen to the applicant in fact, not what could or might happen if the applicant behaved in a particular way that would reduce the risk of persecution, as for example by behaving discreetly. In the present appeal, the appellant asked, reasonably in my view, whether there was a difference between requiring a person to "act reasonably", by behaving discreetly as a homosexual in Bangladesh, and requiring a journalist, who had been propounding unwelcome political opinions in one region of Ukraine, to "act reasonably" by relocating to another part of that country, so as to 93 (2003) 216 CLR 473 at 500 [78], 501 [83], 503 [88] (emphasis in original). Kirby avoid upsetting persecutors, fear of whose conduct had led to the flight from Ukraine to Australia and the application for protection as a refugee. Subsequent conflict in the Federal Court: The appellant's question, which relates to the ambit of the application of the principle stated in S395, has been the subject of differences of opinion in the Federal Court of Australia. In NALZ v Minister for Immigration and Multicultural and Indigenous Affairs94 the operation of the principle in S395 divided a Full Court of that court. NALZ was a case concerned with an Indian national who claimed a well- founded fear of persecution owing to suspected connections with a Sri Lankan separatist organisation. The suspicion was claimed to be founded on his religion as a Muslim and his engagement in the business of selling electrical goods to Sri Lankan nationals. The Tribunal refused refugee status. It concluded that the applicant's religion was immaterial. As to his occupation, it concluded that "the appellant could avoid future arrest by not selling electrical goods to Sri Lankan nationals"95. It decided that it would not be "unreasonable for him to avoid arrest by so doing"96. The question was whether this was but an impermissible variation on the theme of "acting discreetly". A majority (Emmett and Downes JJ) thought not. However, the third judge, Madgwick J considered that the Tribunal's reasoning involved the very kind of error that S395 had identified97. In rejecting this argument, in NALZ, Emmett J suggested two reasons for distinguishing S395. The first, he concluded, was a factual one, namely that the sexual orientation of the applicants in S395 could not be removed, by reasonable action or otherwise, anywhere within Bangladesh. The source of the persecution was thus nation-wide and generalised98. In this sense it was like that faced by persons in the class found to exist in Khawar99 (unprotected women in Pakistan). Secondly, Emmett J concluded that the suggested adjustment in NALZ (ceasing to sell electrical goods) did not involve, in itself, surrender of fundamental rights of the kind protected by the Refugees Convention categories100. 94 (2004) 140 FCR 270. 95 See (2004) 140 FCR 270 at 279 [37] per Emmett J. 96 See (2004) 140 FCR 270 at 279 [37] per Emmett J. 97 (2004) 140 FCR 270 at 274-275 [13]. 98 (2004) 140 FCR 270 at 281 [46]. 99 (2002) 210 CLR 1. 100 (2004) 140 FCR 270 at 281-282 [49]-[50]. Kirby Accepting that any question of "reasonable" adjustment (as in a propounded internal relocation) will raise issues on which minds may sometimes differ, the reasoning of Emmett J in NALZ offers an acceptable way of reconciling this Court's holding in S395 with the by now well settled line of authority in Australia and elsewhere, recognising the existence of a consideration of internal relocation, where that course would be reasonable in the country of nationality. Such relocation will be a permissible hypothesis, open to the decision-maker, where it is neither contrary to the facts (ie, there is a local rather than nation-wide source of persecution) nor contrary to the essential purpose of the Refugees Convention (which denies, as unreasonable, an "adjustment" that would involve undermining the central purpose of the Refugees Convention of protecting the important, but limited, grounds of "persecution" specified in the Refugees Convention). Application of the relocation principle Application to the first argument: The foregoing analysis requires the rejection in this appeal of any suggestion that the consideration of the reasonable possibility of internal relocation would of itself be inconsistent with the language and purpose of the Refugees Convention, as given effect by s 36(2) of the Act. The overwhelming evidence of State practice, international opinion and expert statements, concerned with the issue of internal relocation, supports the acceptability of taking that possibility into account in judging a claim to refugee status. Most such opinion and State practice gives consideration to the reasonable possibility of relocation as relevant to whether the "fear of being persecuted" for Refugees Convention reasons, propounded by the refugee applicant, is "well-founded". This approach is consistent both with the holdings of this Court on the meaning of "the protection" of the country of nationality to which the Refugees Convention definition is addressed101 and the decision requiring that such claims be judged by reference to what the individual applicant fears and how the individual applicant may be treated if, in fact, he or she were returned to the country of nationality102. To consider what it is reasonable for the refugee applicant to do by way of internal relocation is not to hypothesise supposedly reasonable conduct such as "living discreetly". This was rejected in S395. The supposed possibility of relocation will not detract from a "well-founded fear of persecution", if otherwise established, where any such relocation would, in all the circumstances, be unreasonable. It will be unreasonable where to propound it amounts to an affront 101 See above at [58]. 102 See above at [86]-[89]. Kirby to any of the specified Refugees Convention-based grounds of persecution, which it is the object of the Refugees Convention to prevent, discourage and redress103. When these principles are applied to the present case, it is certainly arguable that the Tribunal correctly approached the application of the relocation test. It appears to have reached a conclusion that the source of the persecution of the appellant was localised in the Chernovtsy region of Ukraine. That factual determination was open on the evidence. It was apparently on that basis that the Tribunal concluded that it would be reasonable for the appellant to relocate to another region of Ukraine104. Further, the consideration of relocation was correctly perceived to be relevant to the issue of whether, within the Refugees Convention definition, the appellant's propounded fear of persecution was "well- founded". I remind myself again of this Court's instruction that it is a mistake for courts, considering applications for judicial review of administrative decisions such as those of the Tribunal, to conduct the review in an over-zealous way105. On the other hand, one of the key requirements, insisted upon by both joint reasons in S395, was that the Tribunal must consider how in fact the refugee applicant will act if returned to the country of nationality. Necessarily, this must be considered in cases where the internal relocation postulate is raised, bearing in mind that the applicant will be expected to act reasonably. However, the focus remains on the refugee applicant personally and what in fact might occur. In the present case, the Tribunal, uninstructed by S395, failed to give consideration to this issue which was important to all of the majority reasons in S395. Application to the second argument: It is unnecessary for me to decide finally whether, on his first argument, the present appellant has established a constructive failure of the Tribunal to exercise the jurisdiction lawfully. This is because the appellant is certainly entitled to succeed on his second argument. This arose out of the Tribunal's thinking evident in the following passage106: "If he went back to Ukraine and got work outside journalism it seemed to me he would not be at risk of further mistreatment. He said that he will always be a journalist … 103 cf reasons of Callinan J at [106]-[107]. 104 Reasons of the Tribunal at [55], [79]. 105 Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 106 Reasons of the Tribunal at [52] and [79]. Kirby While he may not be able to work as a journalist elsewhere in Ukraine I believe that he may be able to obtain work in the construction industry as he has done in Australia." This reasoning involves a more specific and particular error and the appellant latched onto it. Effectively, the Tribunal not only propounded the reasonable possibility of the relocation of the appellant within Ukraine but that the appellant would also change his occupation from journalist (where his political opinions could still get him into trouble) so as to "obtain work in the construction industry [in Ukraine] as he has done in Australia"107 (where, by inference, his work would not cause him any trouble). In this approach, the Tribunal displayed a clear error in its understanding of the purpose of the Refugees Convention which includes that of safeguarding the appellant's right to have, and to express, his "political opinion" in Ukraine and not to be persecuted for it. That right is specifically within the protection of the Refugees Convention. It cannot be a reasonable adjustment, contemplated by that Convention, that a person should have to relocate internally by sacrificing one of the fundamental attributes of human existence which the specified grounds in the Refugees Convention are intended to protect and uphold. The Tribunal's perceived analogy to the appellant's work in the construction industry in Australia was clearly an irrelevant one. In Australia, there is no applicable inhibition on the appellant's entitlement to have and to express political opinions, including in relation to alleged corruption on the part of public figures. By inference, the appellant works in the construction industry in Australia because considerations of language and qualifications may make it difficult for him to secure immediately equivalent employment here as a political journalist. It appears plain that the Tribunal was applying, in the appellant's case, not only the hypothesis of reasonable internal relocation (which was acceptable) but also the hypothesis of avoiding the expression of political opinions in the relocated place (which was not). Orders The appellant has therefore established jurisdictional error on the part of the Tribunal. This attracts an entitlement to judicial review which should have been granted by the courts below. It follows that relief should now be granted by this Court in terms of the orders proposed in the joint reasons. I agree in the making of those orders. 107 Reasons of the Tribunal at [79]. See also joint reasons at [31]. CALLINAN J. Subject to two matters, I agree with the reasoning and conclusion of Gummow, Hayne and Crennan JJ. The first point that I would make is as to the appropriate interpretation of the Tribunal's findings. I would not regard it as having taken a stance that there was an expectation or requirement that the appellant could and should live discreetly elsewhere in Ukraine: rather its finding was, I think, that, to the extent that it was not unreasonable to require or expect that the appellant should cease to voice his political opinions wherever he might live in Ukraine, and, accordingly, taking it as a reasonable assumption that he would do so, he could not be regarded as a relevantly persecuted person. The second point that I make is that it is, with respect, too categorical to hold that discretion with respect to membership, or an attribute of a social group, properly defined is a necessarily unreasonable requirement or expectation, or, if it has to be exercised to avoid persecution, will mean in all circumstances that the member is a persecuted person, or under threat of persecution for the purposes of the Convention relating to the Status of Refugees and the Migration Act 1958 (Cth). I would join in the orders proposed by Gummow, Hayne and Crennan JJ. Callinan
HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Pickering v The Queen [2017] HCA 17 3 May 2017 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland made on 6 May 2016, and in its place order that: the appeal be allowed; the appellant's conviction be quashed; and a new trial be had. On appeal from the Supreme Court of Queensland Representation M J Copley QC with C J Grant for the appellant (instructed by Anderson Telford Lawyers) M R Byrne QC with G J Cummings for the respondent (instructed by the Director of Public Prosecutions (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Pickering v The Queen Criminal law – Justification and excuse – Resisting actual and unlawful violence threatened to person – Where appellant stabbed deceased – Where appellant acquitted of murder but convicted of manslaughter – Where s 31(1) of Criminal Code (Q) not left to jury – Whether appellant able to rely on s 31(1) to deny criminal responsibility in relation to offence of manslaughter – Whether s 31(2) renders s 31(1) unavailable wherever evidence discloses that act of accused constitutes offence described in s 31(2) regardless of charge. Words and phrases – "act", "criminally responsible", "liable to punishment", "offence". Criminal Code (Q), s 31. KIEFEL CJ AND NETTLE J. The appellant was tried in the Supreme Court of Queensland for the murder of Ivan John Owens ("the deceased"). He was acquitted of murder but convicted of manslaughter. The appellant's appeal to the Court of Appeal from that conviction was dismissed1. The question on this appeal is whether a miscarriage of justice occurred by reason of the failure of the trial judge to leave to the jury the possible application of s 31(1)(c) of the Criminal Code (Q) ("the Code"). For the reasons which follow, that question should be answered affirmatively and the appeal should be allowed. Relevant statutory provisions So far as is relevant, s 31 of the Code provides: "(1) A person is not criminally responsible for an act or omission, if the person does or omits to do the act under any of the following circumstances, that is to say – (c) when the act is reasonably necessary in order to resist actual and unlawful violence threatened to the person … (2) However, this protection does not extend to an act or omission which would constitute the crime of murder, or an offence of which grievous bodily harm to the person of another, or an intention to cause such harm, is an element …" The facts The appellant's evidence concerning the events in question may be stated shortly. The appellant and the deceased were best friends. On the night in question they had been drinking with a group of people in a hotel. The appellant and the deceased argued and the deceased challenged the appellant to a fight, but it did not take place. When the appellant went home he noticed that his 22 year old son was not there and decided to look for him. He took a fishing knife with him because he was concerned that he might come across the deceased in his search. He thought that he might need to produce a knife to keep the deceased at bay. 1 R v Pickering [2016] QCA 124. Nettle The appellant went to a house where he knew some people would be gathered. He entered the yard and was standing near a vehicle when the deceased and another man approached him. The deceased became very angry and aggressive towards the appellant, despite the attempts of the appellant and others to placate him. The appellant pulled out his knife and told the deceased to stay away. He repeated this a number of times. The appellant reminded the deceased about another "good mate" who had "killed himself over a woman". The deceased reacted angrily to this and came towards the appellant. The appellant was pressed up against the vehicle and turned to see the man who was accompanying the deceased raise a steel bar above his head. The appellant said that he was scared and begged the deceased to stay away from him. He had never seen the deceased so angry before. He said that the deceased was going to "steam-roll me ... he was going to wipe me out". Suddenly, he said, the deceased was on top of him and his knife was in the deceased. The deceased died due to an injury inflicted by the appellant when he stabbed the deceased in the left upper part of his chest under the collarbone. The blade of the knife severed a major artery and a major vein. Only moderate force was necessary to inflict the injury given the sharpness of the knife used by the appellant. The purpose of s 31(1) and (2) The purpose of s 31(1) and (2) is clear. Section 31(1) provides exculpation to a person who would otherwise be criminally responsible under the Code for an act or omission in the circumstances there specified. Section 31(2) excepts from s 31(1) certain offences. If the offence for which a person would be criminally responsible is one to which s 31(2) applies, that provision maintains the person's criminal responsibility. Proceedings in the Court of Appeal Before the Court of Appeal (Fraser JA, Holmes CJ and Gotterson JA agreeing), it was not in dispute, and their Honours accepted2, that s 31(1)(c) was fairly raised on the evidence at trial unless it were excluded by s 31(2). No direction was given by the trial judge as to those provisions. Although the jury were instructed to consider whether the appellant was guilty of manslaughter in the event that they acquitted him of murder, they were not directed to consider whether the prosecution negatived the possibility that the appellant's act of stabbing was an act which came within s 31(1)(c). 2 R v Pickering [2016] QCA 124 at [9]. Nettle It was also not in dispute, and the Court of Appeal found3, that there was a reasonable possibility that the trial judge's failure to direct the jury on s 31(1)(c) may have affected the verdict. The Court of Appeal accepted4 that, if s 31(2) did not exclude the application of s 31(1)(c), there had been a miscarriage of justice. In that event, it would follow that the appellant's conviction should be quashed and a new trial ordered. However, the Court of Appeal concluded5 that the appellant's case fell within the exceptions stated in s 31(2). The appellant's arguments before the Court of Appeal The appellant's argument before the Court of Appeal necessarily focussed upon the construction of s 31(2). The appellant argued that s 31(2) in its terms did not contemplate excluding from the protective provision of s 31(1) an act which constituted manslaughter. The Crown argued that because the act for which he sought exculpation caused grievous bodily harm, s 31(2) applied to it. This was so even though the appellant had not been charged with an offence of which unlawfully causing grievous bodily harm is an element. The appellant submitted that the "act" for the purpose of s 31(1)(c) was the stabbing of the deceased. The question for the jury was whether the act of stabbing the deceased was reasonably necessary in order to resist actual and unlawful violence threatened to him. Section 31(2) would not serve any useful purpose if it denied the protection given by s 31(1) to an act which was not the subject of the charge. The phrase "an act ... which would constitute the crime of murder, or an offence of which grievous bodily harm to the person of another, or an intention to cause such harm, is an element" should be understood to refer to the "offence" in respect of which he seeks exculpation, namely manslaughter. The appellant contended that this construction was supported by the accepted meaning of the word "act" in Ch 5 of the Code, namely a physical action distinct from its consequences. The expression "which would constitute ... an offence of which grievous bodily harm … is an element" did not apply merely because the evidence showed that the act in question was productive of grievous bodily harm. The final limb of the appellant's argument was that, as a matter of construction, s 31(2) could not apply because grievous bodily harm is not an "element" of the offence of manslaughter. 3 R v Pickering [2016] QCA 124 at [17]. 4 R v Pickering [2016] QCA 124 at [18]. 5 R v Pickering [2016] QCA 124 at [47]. Nettle The Court of Appeal's reasoning The Court of Appeal rejected the appellant's arguments and concluded that the appellant's case fell within the exceptions stated in s 31(2). The Court of Appeal considered that the words in s 31(2), "an act … which would constitute … an offence of which grievous bodily harm to the person of another ... is an element", were to be construed according to their ordinary meaning, considered in their statutory context6. The context for s 31 was provided by the sentences which might be imposed for the offences of manslaughter and of unlawfully doing grievous bodily harm and the inferences to be drawn from them about legislative policy. The Code provided a more severe maximum penalty for manslaughter than for doing grievous bodily harm. The maximum penalty for manslaughter has always been life imprisonment (s 310); for unlawfully doing grievous bodily harm it is 14 years imprisonment (s 320). The Court of Appeal discerned the policy of the Code to be that, because manslaughter involves the death of a person, it is generally to be regarded as a much more serious offence than an offence of doing grievous bodily harm. On the appellant's construction, s 31(2) would exclude the protection of s 31(1) where the offence charged is unlawfully doing grievous bodily harm, but not where the offence charged is manslaughter. In any given case, the only relevant factual difference between the two offences might be that, in the case of manslaughter, the offence results in death, whereas, in the case of unlawfully doing grievous bodily harm, the offence results in something very much less; and, depending on the circumstances, it might be entirely fortuitous whether an act of doing grievous bodily harm results in one or other outcome. On that basis, the Court of Appeal concluded7 that the effect of the appellant's construction could not have been intended by Parliament, and that an alternative construction which could avoid those results should be adopted. The Court of Appeal accepted that there was some support for the appellant's submission that the "act" referred to in s 31(1)(c) and in s 31(2) is the physical act which is an element of the offence charged. It observed8 that in Larsen v G J Coles & Co Ltd9, the Full Court took the relevant act in relation to s 23 of the Code to be the "act charged". Their Honours also observed10 that, in 6 R v Pickering [2016] QCA 124 at [41]-[42]. 7 R v Pickering [2016] QCA 124 at [43]-[45]. 8 R v Pickering [2016] QCA 124 at [44]. (1984) 13 A Crim R 109 at 110-111. 10 Larsen v G J Coles & Co Ltd (1984) 13 A Crim R 109 at 111. Nettle that case, the "act or omission" in s 24 was also the act or omission charged. The Court of Appeal allowed11 that it was not difficult to accept that the reference in s 31(1)(c) to the "act" is to the "act or omission" identified in the introductory words of s 31(1). But, their Honours said, it did not follow that the exception in s 31(2) applies only in relation to an act or omission which is an element of the particular offence with which the appellant was charged12. The Court of Appeal held13 that "the criterion of operation of the exception in s 31(2) is a specified quality of the act or omission referred to in s 31(1): if the act or omission 'would constitute' an offence described in s 31(2), then protection for that 'act or omission' is excluded". The expression "would constitute" did not require that the frame of reference be confined to the offence charged. On the Court of Appeal's construction, s 31(2) applied to offences whether charged or not. The construction adopted by the Court of Appeal was that whatever offence is charged the question is "whether or not the act or omission for which the accused seeks protection in relation to the offence charged constitutes one of the offences described in s 31(2)"14. In the result, the construction adopted by the Court of Appeal was applied15 to the appellant's case as follows. The relevant "act" in s 31(1)(c), for which the appellant sought protection in relation to the offence of manslaughter, was the appellant's act of stabbing the deceased in the way he did. Grievous bodily harm was an element of the offence of unlawfully doing grievous bodily harm16. There was no doubt, on the medical evidence, that the injuries inflicted by the appellant amounted to grievous bodily harm. It followed, in the terms of s 31(2), that the appellant's act of stabbing the deceased was an act that would constitute the offence of unlawfully doing grievous bodily harm. Therefore s 31(2) operated to exclude the protection under s 31(1)(c). It did not matter that the deceased died of his injuries and the appellant was charged with murder and convicted of manslaughter. 11 R v Pickering [2016] QCA 124 at [44]. 12 R v Pickering [2016] QCA 124 at [44]. 13 R v Pickering [2016] QCA 124 at [45]. 14 R v Pickering [2016] QCA 124 at [45]. 15 R v Pickering [2016] QCA 124 at [47]. 16 Criminal Code (Q), s 320. Nettle Difficulties with the Court of Appeal's reasoning The Court of Appeal's reasoning is attended by a number of difficulties. Principally, it extends the focus of the inquiry as to criminal responsibility beyond the physical act the subject of the offence charged, to the consequences of that act. Although the Court of Appeal explained that its construction had regard to the quality of the act in question, the "quality" to which their Honours referred was the nature and extent of the injury inflicted, namely, "grievous bodily harm"17. The difficulty with that approach is that, although "grievous bodily harm" is often used, in a shorthand way, to refer to the offence of unlawfully doing grievous bodily harm, "grievous bodily harm" is a consequence, not a quality, of an act causing grievous bodily harm. The words "a person is not criminally responsible" appear in a number of provisions in Ch 5 of the Code which concern criminal responsibility, such as ss 22, 23, 25 and 27. "Criminally responsible" is defined by s 1 to mean "liable to punishment as for an offence". "Offence" is defined in s 2 as "[a]n act or omission which renders the person doing the act or making the omission liable to punishment". These sections, like s 31(1), provide an excuse to a person from criminal responsibility for an offence for which they would otherwise be liable to punishment. That is to say, they are directed to the offence or offences with which a person is charged. As the appellant points out, cognate provisions in Ch 5, which provide excuses from criminal responsibility for acts, have been held to refer to the offence with which the accused person is charged18. They do not refer to the consequences of the offence with which the person is charged. The "act" constituting an offence for which a person may be excused from criminal responsibility has a settled meaning. In Kaporonovski v The Queen19, Gibbs J was concerned with the "act" referred to in s 23 of the Code. It provided, in relevant part, that "a person is not criminally responsible for an act or omission which occurs independently of the exercise of his will". His Honour said20 that 17 Section 1 of the Criminal Code (Q) relevantly provides that "grievous bodily harm" includes "any bodily injury of such a nature that, if left untreated, would endanger or be likely to endanger life, or cause or be likely to cause permanent injury to health". 18 Walden v Hensler (1987) 163 CLR 561 at 573, 603; [1987] HCA 54; Stevens v The Queen (2005) 227 CLR 319 at 324 [11]; [2005] HCA 65; Larsen v G J Coles & Co Ltd (1984) 13 A Crim R 109 at 111. 19 (1973) 133 CLR 209 at 231; [1973] HCA 35. 20 Kaporonovski v The Queen (1973) 133 CLR 209 at 231. Nettle the "act" to which the section referred was some physical action apart from its consequences. His Honour gave as examples the firing of the rifle rather than the wounding in Vallance v The Queen21, and the wielding of the stick as compared to the killing of the baby in Timbu Kolian v The Queen22. In the present case the "act" in question, in both s 31(1) and (2), is the physical act of the appellant stabbing the deceased. It does not include the physical harm the deceased suffered as a consequence. Section 31(2) relevantly excepts from the exculpatory provisions of s 31(1) murder and those offences of which grievous bodily harm is an element. The only reference to "an act" is that which constitutes the offence of murder. In terms, s 31(2) is not concerned with an act having a particular "quality" which is to be discerned from its consequences. The inquiry is directed to whether the offence in question is either murder or an offence of which grievous bodily harm is an element. Manslaughter is not one of those offences. Finally, as Fraser JA acknowledged23, critical to the Court of Appeal's reasoning was the meaning to be given to the words "would constitute ... an offence" in s 31(2). It was by reference to these words that their Honours widened the operation of s 31(2) beyond murder and the other offences identified in s 31(2) to any act which, although not charged as one of the other offences identified in s 31(2), would be capable of constituting one of those offences. But s 31(2) is not constructed in that way. The "act" it refers to is the act which constitutes murder. According to their natural and ordinary meaning, the words "act ... which would constitute the crime of murder" mean simply that, were it not for the operation of s 31(1), the act would constitute murder and the accused is criminally responsible for that act. The words "which would constitute" are syntactically unconnected to the other offences identified in s 31(2). The effect of s 31(2) is thus to maintain that criminal responsibility only for murder and the other offences to which it refers, by withdrawing those offences from the operation of s 31(1). 21 (1961) 108 CLR 56; [1961] HCA 42. 22 (1968) 119 CLR 47; [1968] HCA 66. 23 R v Pickering [2016] QCA 124 at [45]. Nettle The proper construction of s 31(2) The definition of an offence determines its elements. In Kaporonovski v The Queen24, McTiernan ACJ and Menzies J said25: "Prima facie an offence of which an assault is an element means an offence which is not committed unless there be an assault, for it is the definition of an offence which determines its 'elements'." Manslaughter is defined by s 303 as "unlawfully kill[ing] another under such circumstances as not to constitute murder". Unlawful killing refers to causing death without authorisation, justification or excuse26. Critically, grievous bodily harm is not an element of manslaughter. Because s 31(1) and s 31(2) are concerned with an act for which a person may be criminally responsible, the offence to which those provisions refer is that with which an accused is charged or a lesser included offence of which the accused may be convicted. Properly construed, therefore, s 31(2) relevantly provides that if, but for s 31(1), the offence charged or a lesser included offence of which the accused is liable to be convicted is murder or one of which grievous bodily harm is an element, the accused cannot be excused under s 31(1)(c) from the act constituting the offence. Policy concerns Central to the Court of Appeal's reasoning were concerns about the seriousness of the crime of manslaughter relative to the offence of unlawfully doing grievous bodily harm. As the Court of Appeal observed27, on the appellant's construction, a person would be criminally responsible for that offence but not for manslaughter despite the maximum sentence for the latter being much higher. It may be accepted that s 31(2) may produce some anomalous results. As has been observed, s 31(2) applies to the offence of intentionally causing grievous bodily harm, and the maximum sentence for intentionally causing 24 (1973) 133 CLR 209. 25 Kaporonovski v The Queen (1973) 133 CLR 209 at 217. 26 Criminal Code (Q), ss 291, 293. 27 R v Pickering [2016] QCA 124 at [43]. Nettle grievous bodily harm, like manslaughter, is life imprisonment28. Section 31(2) is apt also to refer to the lesser offence of unlawfully doing grievous bodily harm, for which the sentence is much less. Thus, depending on the facts of a given case, it may appear odd that an accused is entitled to claim the benefit of s 31(1) in answer to a charge of manslaughter, but, had the victim not died, the accused would not have been entitled to claim the benefit of s 31(1) in answer to a charge of intentionally causing grievous bodily harm or of doing grievous bodily harm. As against that, however, manslaughter is an offence that may be committed in an infinite variety of circumstance, ranging from what for all intents and purposes is tantamount to murder down to something which, when viewed objectively, is no more heinous than a moment's inattention to a task in hand29. For that reason, it is notorious that manslaughter attracts a wider range of sentences than any other crime30. That being so, it does not present as illogical for the legislature to have determined that the offence of manslaughter should be included within the protection of s 31(1)(c). A legislative choice has been made as to which offences will not be subject to the exculpatory provision of s 31(1). The offence of manslaughter is not an offence of murder and is not an offence of which grievous bodily harm is an element. A person charged with manslaughter is not to be denied the benefit of s 31(1)(c) because the injury inflicted in the circumstances there described amounts to grievous bodily harm. During the course of argument on this appeal a question was raised as to whether the Court of Appeal's construction would create difficulties, in particular for the defence, with respect to the evidence to be led, given that s 31(2) could apply to offences not the subject of charges. The appellant did not suggest that these difficulties were insurmountable, although there are perhaps further reasons for concluding that s 31(2) does not have the effect for which the Crown contended. It is not necessary to consider the question in any detail. The terms of s 31(2) are clear. Conclusion The appeal should be allowed, the appellant's conviction quashed and a new trial ordered. 28 Criminal Code (Q), s 317. 29 R v Lavender (2005) 222 CLR 67 at 70 [2]; [2005] HCA 37. 30 R v Blacklidge unreported, New South Wales Court of Criminal Appeal, 12 December 1995 per Gleeson CJ. GAGELER, GORDON AND EDELMAN JJ. The appellant was tried in the Supreme Court of Queensland before a judge and jury on a count of murder. The Crown alleged that the appellant had stabbed the deceased. The appellant was acquitted of murder but convicted of manslaughter pursuant to s 576(1) of the Criminal Code (Q) ("the Code"). The appellant appealed against his conviction to the Court of Appeal of the Supreme Court of Queensland on the sole ground that a miscarriage of justice had occurred because s 31(1)(c) of the Code was not left to the jury. Under s 31(1)(c), a person is not criminally responsible for an act if the act is reasonably necessary in order to resist actual and unlawful violence threatened to the person. But under s 31(2), that protection does not extend, among other things, "to an act … which would constitute the crime of murder, or an offence of which grievous bodily harm to the person of another, or an intention to cause such harm, is an element". It was not in dispute that s 31(1)(c) was fairly raised on the evidence at trial unless it was excluded by s 31(2)31. The Court of Appeal (Fraser JA, Holmes CJ and Gotterson JA agreeing) held that s 31(2) applied if, on the evidence, the act for which an accused seeks to avoid criminal responsibility would constitute an offence of the kinds described in s 31(2), irrespective of whether such an offence had actually been charged32. It was not suggested that grievous bodily harm or an intention to cause such harm was an "element" of the offence of manslaughter in Queensland33. However, the Court of Appeal held s 31(1)(c) did not avail the appellant, because his act of stabbing the deceased in the way he did was an act that "would constitute" the offence of unlawfully doing in s 31(2)35. grievous bodily harm The appellant's appeal was therefore dismissed. to another34, an offence described The issue on appeal to this Court is narrow. Does s 31(2) of the Code apply to an act only if the accused has been charged in relation to that act with an offence of the kinds described in s 31(2) and seeks to invoke s 31(1) to deny criminal responsibility on that charge? Or does s 31(2) apply wherever the 31 R v Pickering [2016] QCA 124 at [4], [9]. 32 Pickering [2016] QCA 124 at [45]. 33 See s 303 of the Code. 34 Pickering [2016] QCA 124 at [47]. 35 See s 320 of the Code. evidence discloses that the act done by the accused constitutes one of the described offences regardless of the charge? The former, not the latter, is the correct construction of s 31(2). Section 31(1) is not available to deny criminal responsibility on a charge of any of the offences described in s 31(2). Section 31(1) may, if it is open on the evidence, be available in relation to any other offence that is charged or that is available as an alternative verdict. The appeal should be allowed. Statutory framework Section 31, headed "Justification and excuse—compulsion", is located in Ch 5 (entitled "Criminal responsibility") of the Code. The section provides: "(1) A person is not criminally responsible for an act or omission, if the person does or omits to do the act under any of the following circumstances, that is to say— in execution of the law; in obedience to the order of a competent authority which he or she is bound by law to obey, unless the order is manifestly unlawful; (c) when the act is reasonably necessary in order to resist actual and unlawful violence threatened to the person, or to another person in the person's presence; (d) when— the person does or omits to do the act in order to save himself or herself or another person, or his or her property or the property of another person, from serious harm or detriment threatened to be inflicted by some person in a position to carry out the threat; and the person doing the act or making the omission reasonably believes he or she or the other person is unable otherwise to escape the carrying out of the threat; and (iii) doing the act or making the omission is reasonably proportionate to the harm or detriment threatened. (2) However, this protection does not extend to an act or omission which would constitute the crime of murder, or an offence of which grievous bodily harm to the person of another, or an intention to cause such harm, is an element, nor to a person who has by entering into an unlawful association or conspiracy rendered himself or herself liable to have such threats made to the person. (3) Whether an order is or is not manifestly unlawful is a question of law." (emphasis added) "[C]riminally responsible" is defined as "liable to punishment as for an offence"36 (emphasis added). "[O]ffence", in turn, is defined as "[a]n act or omission which renders the person doing the act or making the omission liable to punishment"37. The "act" constituting an offence refers to some "physical action, apart from its consequences"38. Operation of s 31 Section 31(1) relevantly provides that a person is "not criminally responsible" for an act if the person does that act in one of the specified circumstances. That is, in relation to that act, they are not "liable to punishment as for an offence"39 (emphasis added). "[O]ffence" is relevantly defined as an act which renders the person doing the act liable to punishment40. It necessarily follows that an act done in one of the circumstances specified in s 31(1) is not an offence; the act does not constitute an offence. Section 31(2), in its terms, qualifies the scope of s 31(1). Section 31(2) relevantly provides that the protection in s 31(1) does not extend to an act which "would constitute the crime of murder, or an offence of which grievous bodily harm to the person of another, or an intention to cause such harm, is an element" (emphasis added). It applies where the act "would constitute", not "constitutes", one of the described offences. It is conditional. Accordingly, it is necessary to 36 s 1 of the Code. 37 s 2 of the Code. 38 Kaporonovski v The Queen (1973) 133 CLR 209 at 231; see also at 241; [1973] HCA 35. 39 See the definition of "criminally responsible" in s 1 of the Code. 40 s 2 of the Code. identify the condition which enlivens s 31(2). Put another way, the question is: "would constitute" if, or but for, what? Sub-sections (1) and (2) of s 31 apply in sequence. Section 31(2) can be enlivened only where an accused seeks to invoke s 31(1) in relation to a particular charge. Therefore, the conditional or hypothetical "would" logically directs attention to the effect of s 31(1). It logically raises the question: in circumstances where the accused seeks to invoke s 31(1) (so that the relevant act, done in one of the specified circumstances, does not constitute an offence), would that act constitute one of the offences described in s 31(2) but for the operation of s 31(1)? That understanding of s 31(2) has the following consequences. First, s 31(2) only applies to an act if the accused has, in relation to that act, been charged with one of the described offences (or such an offence is available as a statutory alternative to the offence charged41) and the accused seeks to invoke s 31(1) to exculpate himself or herself in relation to the described offence. Contrary to the conclusion of the Court of Appeal, s 31(2) is not directed to, or concerned with, whether the evidence discloses that the accused committed one of the described offences regardless of the charge. Second, where a single act is alleged to constitute multiple offences (or where there is provision for a statutory alternative verdict), s 31(2) applies to that act only in relation to the offences which are described in s 31(2). That may be illustrated by reference to the circumstances of this case, where the appellant was charged with murder and a verdict of manslaughter was available as a statutory alternative. In such circumstances, s 31(2) prevents an accused from relying on s 31(1) in relation to the primary charge of murder, but it does not render s 31(1) unavailable in relation to the alternative verdict of manslaughter. In short, the practical effect of s 31(2) is as follows. Section 31(1) is not available to deny criminal responsibility on a charge of any of the offences described in s 31(2). Section 31(1) may, if it is open on the evidence, be available in relation to any other offence that is charged or that is available as an alternative verdict. In the Court of Appeal's view, that would produce a "surprising" result in that the protection afforded by s 31(1) would be available for manslaughter but not for unlawfully doing grievous bodily harm42. The result was said to be 41 See Ch 61 ("Effect of indictment") of the Code. 42 See Pickering [2016] QCA 124 at [44]. surprising because the offence of manslaughter involves the death of a person and is therefore "generally to be regarded as a much more serious offence" than the offence of unlawfully doing grievous bodily harm, and the Code recognises this by providing "a more severe maximum penalty for manslaughter than for unlawfully doing grievous bodily harm"43. However, the force of that concern is diminished once it is acknowledged that there are other offences not described in s 31(2) which attract a maximum penalty greater than the maximum penalty for unlawfully doing grievous bodily harm. The protection provided by s 31(1) extends also to those offences, despite their seriousness. Moreover, "[f]or more than a hundred years, judges in all Australian jurisdictions, and in England, have observed that, of all serious offences, manslaughter attracts the widest range of possible sentences"44. That observation reflects the fact that the culpability of persons convicted of manslaughter varies widely depending on the circumstances. The proper construction of s 31 allows for the possibility that a person charged with manslaughter, whose culpability was very low, could be absolved of criminal responsibility under s 31(1). The Crown's alternative construction The alternative construction of s 31(2) urged by the Crown, and adopted by the Court of Appeal, asks in effect whether the relevant act would constitute if such an offence had been charged. one of That construction is not supported by the text, context or purpose of s 31(2). the described offences Put simply, s 31(2) does not, in its terms or otherwise, ask if the act would constitute a given offence if that offence had been charged. And whether an offence is charged does not alter whether the act constitutes an offence in the sense that the accused is "liable to punishment" for the act45. What the charge on the indictment determines is whether the accused is in jeopardy of being convicted of a given offence. That is what s 31 is directed to: it provides a basis for exculpation in relation to that offence (and any statutory alternative), except where the charge on the indictment is for one of the offences described in s 31(2). 43 See Pickering [2016] QCA 124 at [43]. 44 R v Lavender (2005) 222 CLR 67 at 77 [22]; [2005] HCA 37. 45 s 2 of the Code. The parties referred to a number of other provisions in the Code which may broadly be termed "defences"46. The Crown did not contend that any of those defences would expand the scope of the trial in the way that s 31(2), on the Crown's construction, would do. In particular, it was not contended that the availability of any of those defences turned on proof of the elements of a separate offence that was not charged. And there is nothing in the text of the Code or its drafting history47 to suggest that s 31(2) was intended, in contrast to those other defences, to be engaged by proof of the elements of a separate offence that was not charged. Moreover, the Crown's alternative construction, if adopted, would create substantial practical difficulties for the conduct of some criminal trials and, potentially, dramatically increase their complexity. That statement requires explanation. In any trial, evidence is received by the court for the purpose of deciding the issues of fact that arise for determination, and to the extent that the evidence is relevant to those issues of fact. In a criminal trial of an indictable offence, the indictment identifies the alleged offence, and the elements of that offence (to the extent that they are disputed) define the facts in issue48. In short, the trial is directed at the offence that has been charged, and the evidence adduced is to be directed at the facts in issue arising out of that offence. And where there is a multiple-count indictment, it is usually necessary for the trial judge to give directions to the jury to consider separately the evidence relating to each count49. It follows that, ordinarily, evidence is not directed at offences which might hypothetically have been charged but were not in fact charged. In response to that issue, the Crown contended that, if its construction were adopted so that s 31(2) precluded exculpation regardless of the charge the subject of the indictment and trial, counsel at trial would simply operate on that basis from the start. But that contention does not fully grapple with the effects of the alternative construction on the criminal law process and, in particular, with how it could unnecessarily increase the complexity of a criminal trial. It would require the 46 See ss 22-25, 270-279 of the Code. 47 See Griffith, Draft of a Code of Criminal Law, (1897) at 16. 48 See HML v The Queen (2008) 235 CLR 334 at 350-352 [4]-[5]; [2008] HCA 16. 49 See, eg, KRM v The Queen (2001) 206 CLR 221 at 234 [36], 257 [106], 260 [118], 263-264 [132]-[133]; [2001] HCA 11; MFA v The Queen (2002) 213 CLR 606 at 617 [34]; [2002] HCA 53. prosecution to prove the elements of a separate, uncharged offence, effectively requiring a trial within a trial, for the sole purpose of determining whether s 31(2) was engaged; not for the purpose of proving the offence charged. That, in turn, would run the risk of undermining the forensic choices of defence counsel: a decision to rely on s 31(1) would have to take account of the possibility that the prosecution might in turn lead evidence to prove an offence not charged – or, indeed, multiple offences not charged. It may be accepted that the consequences of the alternative construction for the conduct of the trial might be less onerous in some cases than in others. But that does not reduce the force of the preceding observations. The proposition that s 31(2) was intended to have those large consequences should not be readily accepted. Conclusion For those reasons, the appeal should be allowed. The protection afforded by s 31(1)(c) was available to the appellant in relation to the offence of manslaughter, being a statutory alternative to the offence charged on the indictment. We agree with the orders proposed by Kiefel CJ and Nettle J.
HIGH COURT OF AUSTRALIA ARGOS PTY LTD & ORS APPELLANTS AND SIMON CORBELL, MINISTER FOR THE ENVIRONMENT AND SUSTAINABLE DEVELOPMENT & ORS RESPONDENTS Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development [2014] HCA 50 10 December 2014 ORDER The appeal of the second and third appellants be allowed. The first to third respondents pay the costs of the second and third appellants. The appeal of the first appellant be dismissed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of the Australian Capital Territory made on 29 November 2013 insofar as they relate to the second and third appellants and, in their place, order that the second and third appellants have their costs of the proceedings to date in that Court. Remit the matter, insofar as it relates to the second and third appellants, further hearing on grounds 4.2, 4.3 and 4.6 of the notice of appeal filed in that Court and dated 2 August 2012. the Court of Appeal for On appeal from the Supreme Court of the Australian Capital Territory Representation N C Hutley SC with C L Lenehan for the appellants (instructed by Bradley Allen Love Lawyers) P J F Garrisson SC, Solicitor-General for the Australian Capital Territory with J J Hutton for the first respondent (instructed by ACT Government Solicitor) M N Allars SC for the second and third respondents (instructed by King & Wood Mallesons) Submitting appearances for the fourth, fifth and sixth respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development Administrative law – Judicial review – Standing – Minister approved development application for commercial development – Appellants conducted businesses near site of proposed development – Appellants alleged development would adversely affect their economic interests – Whether appellants are persons aggrieved by the Minister's decision. Words and phrases – "person aggrieved", "person whose interests are adversely affected". Administrative Decisions (Judicial Review) Act 1989 (ACT), ss 3B(1)(a), 5(1). FRENCH CJ AND KEANE J. The first, second and third appellants carry on their respective businesses at premises located within the Australian Capital Territory ("the ACT"). The first respondent, the Minister for the Environment and Sustainable Development ("the Minister"), made a decision under s 162 of the Planning and Development Act 2007 (ACT) ("the Planning Act") to approve a proposal by the second and third respondents for a new commercial development at a site near the appellants' premises. The appellants sought judicial review of the Minister's decision under the Administrative Decisions (Judicial Review) Act 1989 (ACT) ("the ADJR Act"). Under s 5(1) of the ADJR Act, as it was at the time material to this matter, a person aggrieved by a decision was entitled to make an application to the Supreme Court of the ACT to have that decision reviewed on one or more of the grounds there stated. Section 3B defined "person aggrieved" relevantly in the following terms: "(1) For this Act, a reference to a person aggrieved by a decision includes a reference to – a person whose interests are adversely affected by the decision". The Supreme Court of the ACT, both at first instance and on appeal, held that none of the appellants was a "person aggrieved" by the Minister's decision within the meaning of s 3B of the ADJR Act and, on that basis, dismissed their application for judicial review. In this Court, the appellants contended that the owner of a business, who is likely to suffer a loss of profitability from a greater exposure to commercial competition as a result of the Minister's decision, is a person aggrieved under s 3B(1)(a) of the ADJR Act for the purpose of seeking judicial review of that decision. For the reasons which follow, that contention should be accepted. As a result, the appeal by the second and third appellants should be allowed. As will appear, however, acceptance of that contention does not assist the first appellant. Background The first appellant holds a lease of Crown land at the Kaleen Local Centre1 ("Kaleen"). The second appellant is the sub-lessee of the Crown lease at Kaleen; it operates a Supa Express supermarket (formerly an IGA supermarket) 1 The first appellant is one of eight Crown lessees of the one parcel of land at Kaleen. on that site. The third appellant holds a sub-lease of a Crown lease at Evatt Local Centre ("Evatt"); it operates an IGA supermarket on that site. respondent The second ("the Development Proposal") on behalf of the third respondent under Ch 7 of the The Development Proposal envisioned a commercial Planning Act. development, including a supermarket and speciality shops, at the Giralang Local Centre ("Giralang"). lodged a development application In the ACT, town planning has been regulated by both Commonwealth and Territory legislation since the enactment of the Australian Capital Territory (Self-Government) Act 1988 (Cth). These complicated arrangements were summarised by the primary judge2. It is not necessary to repeat that summary. It is sufficient for present purposes to note that the Planning Act provides for the division of the ACT into zones for the purposes of the Territory Plan3. The land relevant to the Development Proposal is within the Commercial CZ4 – Local Centre zone. The objectives for the Commercial CZ4 – Local Centre zone are to: "(a) Provide for convenience retailing and other accessible, convenient shopping and community and business services to meet the daily needs of local residents Provide opportunities employment for business investment and local Ensure the mix of uses is appropriate to this level of the commercial hierarchy and enable centres to adapt to changing social and economic circumstances (d) Maintain and enhance local residential and environmental amenity through appropriate and sustainable urban design 2 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 18-23 [7]-[29]. 3 Australian Capital Territory (Planning and Land Management) Act 1988 (Cth), Pt IV. Promote the establishment of a cultural and community identity that is representative of, and appropriate to, the place"4. The determination of the Development Proposal was subject to the Local Centres Development Code under the Territory Plan. This Code operated by reference to Rules, which generally required quantitative assessment, and Criteria, which required qualitative assessment5. Consideration of the issue of "Amenity" under the General Development Controls for Commercial Zones was subject to Criterion 33. That criterion stated: "A proposal to carry out development in a local centre must have regard to any significant adverse economic impact on other commercially viable local centres."6 The primary judge's decision At first instance, the second and third appellants led evidence to the effect that if the Development Proposal were to proceed, increased competition would ensue, which would result in a loss of profit to their businesses at Kaleen and Evatt. The first appellant urged that a loss of trade by the second appellant at Kaleen might lead to the closure of the Kaleen IGA, which might, in turn, affect its economic interests as landlord. The primary judge (Burns J) did not accept that the first appellant's interests were sufficiently affected to satisfy s 3B(1)(a) of the ADJR Act. His Honour accepted the evidence that the implementation of the Development Proposal would adversely affect the profitability of the businesses operated by the second and third appellants7. His Honour held that the "real question", as to whether the appellants had standing, was "whether the interests demonstrated by the [appellants] are so directly affected as to justify the right to challenge the 4 Zone Objectives for CZ4 – Local Centre Zone. 5 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 23 [29]. 6 Local Centres Development Code (ACT). 7 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 29 [49]. impugned decision."8 His Honour resolved this question in the negative, concluding that: "the [appellants'] interests are simply that the increased competition provided by the development will have an effect on their profitability, based on how they currently run their business [but] this is too remote to make the second and third [appellants] persons aggrieved by the Minister's decision for the purposes of the ACT ADJR Act. As the first [appellant] is one step further removed in terms of the effect that the Minister's decision may have upon it, it follows that it too does not have standing to challenge the decision."9 The primary judge noted that Criterion 33 required a decision-maker to consider significant adverse economic impacts on other commercially viable centres. His Honour said: "the presence of C 33 in the Local Centres Development Code does not indicate a statutory intention to give standing to challenge an approval to which C 33 is relevant to parties whose only interest is a likely economic impact by the proposed development."10 Notwithstanding the primary judge's conclusion as to the appellants' want of standing, his Honour went on to consider the grounds advanced by the appellants for their challenge to the Minister's decision. His Honour rejected them on the merits11. Court of Appeal The Court of Appeal of the Supreme Court of the ACT (Penfold and Cowdroy JJ and Nield AJ) dismissed the appellants' appeal, holding that none of them was a person aggrieved under s 3B(1)(a) of the ADJR Act. Because the 8 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 29 [51], citing Australian Foreman Stevedores Association v Crone (1989) 20 FCR 377. 9 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 30 [53]. 10 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 28 [44]. 11 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 30-35 [55]-[85]. appellants' appeal was dismissed on this basis, the Court of Appeal did not consider the grounds of appeal concerned with the substantive merits of their application for review of the Minister's decision12. The Court of Appeal noted13 the primary judge's conclusions that "the [appellants'] interests … were simply that the increased competition provided by the development would affect their profitability" and that "such possible effect was too remote to render them 'aggrieved persons'." The Court of Appeal characterised the appellants' claim to standing under s 3B(1)(a) of the ADJR Act as "merely concerned with addressing trade competition"14 and "an interest … in trade competition only"15; and, on that basis, concluded that such an interest was insufficient to satisfy s 3B(1)(a) of the ADJR Act. It stated that "[a]s a general rule, mere detriment to the economic interests of a business will not give rise to standing"16. The appellants disputed the existence of that general rule. The Court of Appeal proceeded on the basis that its approach was supported by the decision of Higgins J (as his Honour then was) in Jewel Food Stores Pty Ltd v Minister for the Environment Land and Planning ("Jewel Food Stores")17. Higgins J said that: "although the applicants have shown that the proposal could cause an economic impact upon them and that it is possible that that impact might be adverse, such an effect is not, in my view, sufficient to be a satisfactory 12 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 191 [7]. 13 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 193-194 [22]. 14 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 198 [46]. 15 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 199 [49]. 16 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 195 [29(d)]. 17 (1994) 122 FLR 269. basis for an application. They have merely shown, as in Crone's case, that their economic prospects have become less favourable."18 The reference by Higgins J to "Crone's case" was a reference to Australian Foreman Stevedores Association v Crone, where Pincus J had said19: "A decision favourable to one citizen may affect many others: some directly, and some more remotely. There is a point, which must be fixed as a matter of judgment in each case, beyond which the court must hold that the interests of those affected are too indirectly affected to be recognised. A case such as this, where a decision has been made which is said to be favourable to one of a group of business competitors, is an example; the decision may, by assisting one, relatively disadvantage the others and also affect the prospects of those who are in one way or another dependent on the others – as employees, shareholders, or even personal dependants." The Court of Appeal also referred20 to the decision of Lindgren J in Big Country Developments Pty Ltd v Australian Community Pharmacy Authority ("Big Country")21. In that case, Lindgren J held that the interests of the owner of a shopping centre were not materially affected by a decision of the Australian Community Pharmacy Authority to recommend approval of an application by a tenant of the centre to relocate the pharmacy. Lindgren J deprecated as impractical the "notion that any financial interest adversely affected falls within s 3(4) of the [Administrative Decisions (Judicial Review) Act 1977 (Cth)]."22 Special leave to appeal to this Court was granted by Crennan and Kiefel JJ on 16 May 201423. 18 Jewel Food Stores Pty Ltd v Minister for the Environment Land and Planning (1994) 122 FLR 269 at 280. 19 (1989) 20 FCR 377 at 382. See also Big Country Developments Pty Ltd v Australian Community Pharmacy Authority (1995) 60 FCR 85 at 92-93. 20 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 196 [33]-[34]. 21 (1995) 60 FCR 85. 22 (1995) 60 FCR 85 at 93. 23 [2014] HCATrans 101. The arguments of the parties The appellants submitted that there is "no general rule" that detriment to the economic interests of a business is not sufficient to satisfy the statutory test in s 3B(1)(a). It was said that, given the primary judge's findings as to the likely adverse effect of the Development Proposal on the profits of the second and third appellants, there was no reason to deny that their interests were adversely affected by the decision to approve it. None of the active respondents was disposed to support the "general rule" propounded by the Court of Appeal. Rather, they argued that the decision of the Court of Appeal should be upheld on the basis that the interests of the second and third appellants were too remote or indirect to satisfy s 3B(1)(a) of the ADJR Act. In this regard, the second and third respondents cited the approach of Gummow J in Australian Institute of Marine and Power Engineers v Secretary, Department of Transport24 that "a danger and peril to the interests of the applicant that is clear and imminent rather than remote, indirect or fanciful" must flow from the relevant decision. The appellants deprecated any attempt to approach the interpretation of s 3B(1)(a) using concepts of remoteness, proximity or directness of effect25. The appellants argued that the application of criteria of remoteness, proximity and directness serves only to deepen the indeterminacy of the test for standing under the ADJR Act. The first respondent, in addition to adopting the arguments advanced by the second and third respondents, sought to support the decision of the Court of Appeal on the basis that the scope and purpose of the Planning Act, under which the Minister's decision was made, serve to narrow the interests which satisfy s 3B(1)(a) of the ADJR Act. His contention was that the statutory framework within which the decision was made also establishes the scope of adverse effect on interests for the purposes of s 3B(1)(a) of the ADJR Act. On this approach, the interests of a person are relevantly affected by a decision only if they are "coincidental with the particular public interest"26 addressed by the legislation under which the decision is made. 24 (1986) 13 FCR 124 at 133. 25 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 195-196 [31]. 26 Big Country Developments Pty Ltd v Australian Community Pharmacy Authority (1995) 60 FCR 85 at 93-94. See also Right to Life Association (NSW) Inc v (Footnote continues on next page) The first respondent said that the policy considerations to be gleaned from the ACT planning scheme, and particularly Criterion 33, are concerned solely with local amenity rather than the individual interests of traders in being protected from competition. On that basis, a complaint by an established trader of a loss of profitability, as a result of a decision, is not a complaint about a relevant adverse effect. In response to the first respondent's contention, the appellants conceded that one must have regard to the legislation giving rise to the administrative decision under review in order to ascertain the legal and practical operation of that decision, but contended that the relevant planning law does not limit the operation of the ADJR Act27. It was said that, where a decision is shown to have an adverse practical effect upon a person's interests, it is irrelevant whether or not the interests of the putative applicant are "coincidental with the particular public interest"28 sought to be achieved by the Planning Act. Economic interests The ADJR Act was based on the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the Commonwealth ADJR Act"). Relevantly, ss 3B(1)(a) and 5(1) of the ADJR Act mirror ss 3(4) and 5(1) of the Commonwealth ADJR Act respectively. Accordingly, judicial exegesis of the Commonwealth ADJR Act assists in the interpretation of the ADJR Act. Relatively early in the life of the Commonwealth ADJR Act, it was accepted that a practical effect upon a person's business could satisfy s 3(4) of that Act. In Tooheys Ltd v Minister for Business and Consumer Affairs ("Tooheys")29, Ellicott J said, in relation to s 3(4) of the Commonwealth ADJR Act: Secretary, Department of Human Services and Health (1995) 56 FCR 50 at 68-69, 27 Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 393-394 [36]-[37], 414-415 [96]-[102]; [2012] HCA 56. 28 Big Country Developments Pty Ltd v Australian Community Pharmacy Authority (1995) 60 FCR 85 at 93-94. See also Right to Life Association (NSW) Inc v Secretary, Department of Human Services and Health (1995) 56 FCR 50 at 68-69, 29 (1981) 36 ALR 64 at 79. "[Person aggrieved] does not mean that any member of the public can seek an order of review. I am satisfied, however, that it at least covers a person who can show a grievance which will be suffered as a result of the decision complained of beyond that which he or she has as an ordinary member of the public. In many cases that grievance will be shown because the decision directly affects his or her existing or future legal rights. In some cases, however, the effect may be less direct. It may affect him or her in the conduct of a business". The primary judge and the Court of Appeal accepted, as a fact, that the approval of the Development Proposal would adversely affect the profitability of the businesses owned and operated by the second and third appellants. Having so concluded, the courts below erred in then asking whether a test of "directness" could be satisfied on the basis that those adverse effects depended on uncertain market forces and competitive responses30. The findings of fact, made on the balance of probabilities, determined the factual basis on which the issue was to be decided and, accordingly, resolved the uncertainties for the purposes of this litigation. The active respondents did not seek to challenge the findings that the second and third appellants' businesses would be likely to suffer a reduction in profitability as a result of the implementation of the development at Giralang approved by the Minister's decision. The second and third respondents argued that the appellants had shown only "fears" about economic competition, but not an adversely affected interest for the purposes of s 3B(1)(a). In the absence of a challenge to the factual findings, however, the second and third respondents' assertions do not affect the ground on which the issue is to be determined. The decision of Higgins J in Jewel Food Stores does not support the approach of the Court of Appeal. Higgins J said that "neither the applicants nor any of their customers have any legitimate expectation that competition will be restricted so as to protect their economic interests."31 However, his Honour's decision was based on the conclusion that the evidence as to the level of economic impact on the applicants resulting from the decision sought to be challenged was "purely speculative"32, and did not show that a competing business would have an adverse effect on the applicants' business. That conclusion was critical to his Honour's decision. That this is so may be seen 30 cf Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 199 [51]. 31 (1994) 122 FLR 269 at 280. 32 (1994) 122 FLR 269 at 279-280. from the circumstance that Higgins J accepted as correct33 the view of Ellicott J in Tooheys34 that an "effect … in the conduct of a business" is a sufficient interest for the purpose of the Commonwealth ADJR Act. Similarly, in Crone's case, Pincus J denied standing to applicants who could not show that the success of their challenge to the decision in question would be a practical benefit to them35. In the present case, if the question is asked whether, as Pincus J put it in Crone's case, the second and third appellants will "gain anything of significance"36 if they succeed in their challenge to the decision, the answer is clearly in the affirmative. Based on the factual findings below, they will enjoy the level of profitability which was likely to be denied them in consequence of the approval of the Development Proposal. Standing to challenge a decision under the ADJR Act is determined by s 3B(1) of the Act; but the authorities which address the question of standing under the general law afford some assistance in understanding the kinds of interest which may be relevant and the kinds of effect that may be regarded as adverse. In Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd37, speaking of the sufficiency of an interest required to support an application for a declaration or injunction under the general law, Gaudron, Gummow and Kirby JJ said: "Upon the true construction of its subject, scope and purpose, a particular statute may establish a regulatory scheme which gives an exhaustive measure of judicial review at the instance of competitors or other third parties. An example is the special but limited provision by the legislation considered in Alphapharm Pty Ltd v SmithKline Beecham (Australia) Pty Ltd for judicial review of successful applications for registration. However, the circumstance that the plaintiff conducts commercial activities in competition with those which it seeks to restrain is not necessarily insufficient to provide it with a sufficient interest in the subject matter of the action". (footnote omitted) 33 (1994) 122 FLR 269 at 280. 34 (1981) 36 ALR 64 at 79. 35 (1989) 20 FCR 377 at 379-382. 36 (1989) 20 FCR 377 at 383. 37 (1998) 194 CLR 247 at 266 [48]; [1998] HCA 49. Under the planning regime relevant here, as indeed under the general law, no trader has an interest in hindering competitors or being protected from competition. It is a matter of public policy that no trader has an interest in being protected from "competition per se" or "mere competition"38. In Buckley v Tutty39, Barwick CJ, McTiernan, Windeyer, Owen and Gibbs JJ observed: "There is both ancient and modern authority[40] for the proposition that the rules as to restraint of trade apply to all restraints, howsoever imposed, and whether voluntary or involuntary." Neither the Planning Act nor the Territory Plan evinces any intention to permit decision-makers to accommodate private traders' desires to be protected from competition per se. In this case, however, the second and third appellants demonstrated, as a matter of fact, that their businesses will suffer a loss in profitability as a result of the decision which they sought to challenge. And if their challenge to the lawfulness of the decision proves to have merit, the consequences of the competitive pressures resulting from the decision they seek to challenge can properly be described as a situation of "unfair competition", The position of the first appellant is different. There was no finding of fact that the second appellant's business would be likely to fail as a result of increased competition consequent upon the implementation of the Development Proposal. As a result, there was no finding that the first appellant would, in turn, lose the benefit of its lease to the second appellant. Nor was there a finding that, in the event of the failure of the second appellant, the lettable value of the first 38 Herbert Morris Ltd v Saxelby [1916] 1 AC 688 at 702; Dewes v Fitch [1920] 2 Ch 159 at 181; Lindner v Murdock's Garage (1950) 83 CLR 628 at 634, 649; [1950] HCA 48. 39 (1971) 125 CLR 353 at 375; [1971] HCA 71. 40 Instructive examples of "ancient" authority supporting the proposition that involuntary restraints are unenforceable as contrary to public policy include Ipswich Tailors' Case (1614) 11 Co Rep 53(a) [77 ER 1218] and Gunmakers' Co v Fell (1742) Willes 384 [125 ER 1227]. In the first of these cases, it was held that ordinances of a corporation which purported to impose restraints upon trade were unenforceable in the absence of specific statutory authority ((1614) 11 Co Rep 53(a) at 54(a) [77 ER 1218 at 1220]). In the second of these cases, it was held that a bylaw of a corporation chartered by the Crown which purported to restrain trade was unenforceable ((1742) Willes 384 at 388 [125 ER 1227 at 1228-1229]). 41 Co-Mac Pty Ltd v Queensland Gaming Commission [2009] QSC 33 at [20]. appellant's land would be reduced by the implementation of the proposed development. The appeal by the first appellant fails at this point. Directness, remoteness and proximity In the application of s 3B(1)(a) of the ADJR Act, judgments of fact and degree may be required. That is not unusual where the issue of standing is In Re McHattan and Collector of Customs43, Brennan J said: "a decision which affects the interests of one person directly may affect the interests of others indirectly. Across the pool of sundry interests, the ripples of affection may widely extend. The problem which is inherent in the language of the statute is the determination of the point beyond which the affection of interests by a decision should be regarded as too remote". The judgments of fact and degree required to resolve the "problem … inherent in the language of the statute" may conveniently be expressed in terms of directness or remoteness or proximity. But these terms are expressions of conclusionary judgments; their use does not indicate the deployment of tools of analysis. In the present case, once it was shown, on the balance of probabilities, that the second and third appellants would suffer a not insignificant loss of profitability in their businesses, no further inquiry as to directness or remoteness or proximity was required44 in order to determine whether their interests were adversely affected by the decision in question. The adverse effect upon their interests was sufficient to support the conclusion that they were persons aggrieved for the purposes of s 3B(1)(a) of the ADJR Act. Further, as explained in the next section of these Reasons, the statutory criterion for standing under 42 Robinson v Western Australian Museum (1977) 138 CLR 283 at 302-303; [1977] HCA 46; Seamen's Union of Australia v Utah Development Co (1978) 144 CLR 120 at 130, 159; [1978] HCA 46. 43 (1977) 18 ALR 154 at 157. See also Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 42; [1981] HCA 50. 44 H A Bachrach Pty Ltd v Minister of Housing (1994) 85 LGERA 134 at 137; Loveridge v Pharmacy Restructuring Authority (1995) 39 ALD 103, referred to in Big Country Developments Pty Ltd v Australian Community Pharmacy Authority (1995) 60 FCR 85 at 94-95. s 3B(1)(a) does not alter according to the scope and purpose of the enactment under which the impugned decision is made. Interests and relevant considerations The first respondent submitted that the standing provision of the ADJR Act has to be applied with reference to the scope and purpose of the statute under which the decision under review was made. The second and third respondents submitted in similar vein that standing was to be determined by reference to the nature and subject matter of the litigation including the objects of the statute conferring power to make the decision. Those submissions should not be accepted. The test for standing to apply for review of a decision under the ADJR Act is expressed in that Act. The applicant must be "a person aggrieved", a criterion which may be satisfied if the applicant is a person whose interests are adversely affected by the decision. The text of the criterion, on its face, does not allow for its expansion or contraction according to the scope and purpose of the enactment under which the decision is made. It is not to be read or applied with reference to normative considerations based on the policy of the enactment. To do so by reference to individual enactments would undermine an important purpose of the ADJR Act, which was to simplify judicial review processes45. Consistently with that proposition it will be necessary to have regard to the enactment under which the impugned decision is made and the legal effect and operation of the decision in order to determine how the interests of the applicant for review may be adversely affected or the applicant otherwise a person aggrieved. Reference was made to decisions of the Federal Court which might be thought to support a contrary view. One decision said to be in point in this respect was that of the Full Court of the Federal Court in Right to Life Association (NSW) Inc v Secretary, Department of Human Services and Health ("the Right to Life Case")46, a case concerning an application under the Commonwealth ADJR Act. The Full Court held by majority that the applicant Association, which was a public advocacy body, did not have standing on that account. Lockhart J, in the majority, held that the applicant had not shown a grievance "beyond that which any person has as an ordinary member of the 45 Kioa v West (1985) 159 CLR 550 at 594 per Wilson J; [1985] HCA 81; Minister for Immigration and Multicultural Affairs v Thiyagarajah (2000) 199 CLR 343 at 355-356 [32] per Gleeson CJ, McHugh, Gummow and Hayne JJ; [2000] HCA 9. 46 (1995) 56 FCR 50. public."47 Beaumont J reached a similar conclusion48. Gummow J, in dissent in the result, held that it was unnecessary to determine the question of standing because of the want of a reviewable decision. In the course of his Honour's reasoning, however, he referred to the importance of the scope and purpose of the enactment under which a decision has been made in assessing whether an applicant is "aggrieved" and in ascertaining the content of the terms "interests", "affect" and "adversely". In so doing, his Honour referred to Alphapharm Pty Ltd v SmithKline Beecham (Australia) Pty Ltd49, which was a case in which the relevant review provisions were part of the Act under which the impugned decision was made. So it was possible to say, as his Honour observed of that case, that "the purposes or ends which the Parliament sought to advance by enacting the statute were not those with which the applicant was concerned and seeking to advance by the processes of judicial review"50. But what could be said of the statute-specific review processes considered in Alphapharm could not be said of the general review processes of the ADJR Act. The observations made by Gummow J in the Right to Life Case were relied upon by Lindgren J in Big Country51. It is not necessary to discuss the detail of the case, save to mention the proposition in his Honour's judgment that52: "Such broad notions as 'person aggrieved' and 'interests adversely affected' by administrative decisions under enactments are intended to be relevant to the scope and purpose of the statutes involved in particular cases and are to be construed accordingly." (citations omitted) As already indicated, that proposition should not be accepted. It may be noted that in the Right to Life Case, Lockhart J, in holding that the applicant for review had not shown a grievance, said53: 47 (1995) 56 FCR 50 at 69. 48 (1995) 56 FCR 50 at 82. 49 (1994) 49 FCR 250. 50 (1995) 56 FCR 50 at 84-85. 51 (1995) 60 FCR 85. 52 (1995) 60 FCR 85 at 93. 53 (1995) 56 FCR 50 at 69. "There is no advantage likely to be gained by the appellant if successful in the proceeding nor disadvantage likely to be suffered if it fails." The application of a test by reference to advantage and disadvantage in the present case would support the contentions of the second and third appellants. It may be accepted that the public interest in town planning is properly and relevantly served by ensuring that local shopping centres do not become wastelands by excessive competition between traders. That is the concern addressed by Criterion 33. It may also be accepted that Criterion 33 is concerned with the public interest, and not the interest of individual traders in being protected from competition. But the circumstance that an effect upon a private interest is not a consideration relevant to the making of the decision does not mean that such an interest is not adversely affected by the decision so as to afford an affected person standing to challenge the lawfulness of the decision on grounds that are relevant to its validity. In summary, as Lockhart J54 said in the Right to Life Case, "[t]he term a 'person aggrieved' is not a restrictive one; it is of very wide import." The courts should not be astute to graft restrictions onto the general language of s 3B(1)(a) of the ADJR Act. It must be borne in mind that the ADJR Act is intended to facilitate judicial review of administrative decisions made under a wide range of statutes and having a wide range of practical effects upon members of the community. The availability of judicial review serves to promote the rule of law and to improve the quality of administrative decision-making as well as vindicating the interests of persons affected in a practical way by administrative decision-making. Accordingly, the scope of s 3B(1)(a) of the ADJR Act should not be artificially narrowed by glosses upon its broad language. Conclusion and orders The second and third appellants were entitled to seek review of the first respondent's decision. The first appellant was not. Because the Court of Appeal did not determine the merits of the appeal by the second and third appellants, it will be necessary to remit the matter for further determination of the grounds related to the merits of their appeal. The Court should order: The appeal of the second and third appellants be allowed. 54 (1995) 56 FCR 50 at 65. The first to third respondents pay the costs of the second and third appellants. The appeal of the first appellant be dismissed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of the Australian Capital Territory made on 29 November 2013 insofar as they relate to the second and third appellants and, in their place, order that the second and third appellants have their costs of the proceedings to date in that Court. Remit the matter, insofar as it relates to the second and third appellants, to the Court of Appeal for further hearing on grounds 4.2, 4.3 and 4.6 of the notice of appeal filed in that Court and dated 2 August 2012. HAYNE AND BELL JJ. Section 3B(1)(a) of the Administrative Decisions (Judicial Review) Act 1989 (ACT) ("the ADJR Act") provided55, at the times relevant to this matter, that a reference in that Act to a "person aggrieved" by a decision includes a reference to "a person whose interests are adversely affected by the decision". The issue in the appeal to this Court is whether any of the first, second or third appellants is "a person whose interests are adversely affected by the decision" of the first respondent ("the Minister") to approve, under the Planning and Development Act 2007 (ACT) ("the Planning Act"), a development application made by the second and third respondents for a commercial development at the Giralang Local Centre in the Australian Capital Territory. The second and third appellants each conduct a supermarket business at a Local Centre near Giralang. The first appellant is the second appellant's landlord. The course of proceedings The appellants led evidence at trial to the effect that approval of the development would reduce the annual turnover of the Kaleen and Evatt Local Centres, at which the second and third appellants conduct their respective supermarket businesses. The primary judge (Burns J) accepted56 that the proposed development will have an adverse economic effect on the second and third appellants and that "it is possible that" the economic interests of the first appellant "may come to be indirectly affected by the proposed development". But the primary judge concluded57 that the interests of the appellants "are simply that the increased competition provided by the development will have an effect on their profitability, based on how they currently run their business" and that this was "too remote" to make the second or third appellants "persons aggrieved" by the Minister's decision. The primary judge held58 that the effect on the first appellant was "one step further removed in terms of the effect that the Minister's decision 55 The Administrative Decisions (Judicial Review) Amendment Act 2013 (ACT) repealed s 3B of the ADJR Act, removed references to a "person aggrieved" and substituted provisions allowing an "eligible person" to make an application under the ADJR Act. 56 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 29 [49]. 57 (2012) 7 ACTLR 15 at 30 [53]. 58 (2012) 7 ACTLR 15 at 30 [53]. may have upon it" and that it followed that it too was not a person aggrieved by the decision. The Court of Appeal of the Supreme Court of the Australian Capital Territory (Penfold and Cowdroy JJ and Nield AJ) dismissed59 the appellants' appeal against these conclusions. The Court of Appeal did not disturb the findings of fact made by the primary judge. By special leave, the appellants appeal to this Court. The appeal by the second and third appellants should be allowed and consequential orders made in the form proposed by French CJ and Keane J. A "person aggrieved" The three appellants alleged that each was a person aggrieved because its interests are adversely affected by the Minister's decision. The effect on interests to which the appellants pointed was what they said would be the economic consequences, for each, of the Minister's decision. The second and third appellants alleged that if the Minister's decision stood, each would have reduced turnover and would earn about eight or ten per cent less profit from its business than it would have expected to earn if the Minister had not approved the development at Giralang. By contrast, the first appellant alleged that, if the development at Giralang went ahead, it might (not would) lose the benefit of the lease it had made with the second appellant because the second appellant might (not would) go out of business. The facts established demonstrated that each of the second and third appellants is a person whose interests are adversely affected by the Minister's decision. The facts established did not show that the first appellant is a person whose interests are adversely affected by that decision. The second and third appellants are persons aggrieved; the first appellant is not. The decided cases Extensive reference was made by both the primary judge and the Court of Appeal to the many cases that have been decided about questions of standing generally and about who is a "person aggrieved" for the purposes of various forms of statutory review provisions. Careful attention to authority is always 59 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187. necessary. But it is equally important60 not to treat what is said in the decided cases as a sufficient substitute for the statutory language. If care is not taken, what is said in explanation of the decision reached in a particular case too easily takes on a life of its own separated from the facts and circumstances which explain its particular expression. More importantly, what is said in the decided case becomes separated from the applicable statutory text. Contrary to what was said61 by the Court of Appeal in this case, applying s 3B(1)(a) of the ADJR Act does not begin from recognising some supposed "general rule" that "mere detriment to the economic interests of a business will not give rise to standing". No rule of that kind finds any footing in the text of the ADJR Act and no party in this Court sought to support such a rule. Rather, as has now long been recognised62, the relevant words – "a person whose interests are adversely affected by the decision" – are expressed very generally. To adopt what was said63 in a different but related context, those words should be "construed as an enabling, not a restrictive, procedural stipulation". The focus of the inquiry required by the words is upon the connection between the decision and interests of the person who claims to be aggrieved. The interests that may be adversely affected by a decision may take any of a variety of forms. They include, but are not confined to, legal rights, privileges, permissions or interests. And the central notion conveyed by the words is that the person claiming to be aggrieved can show that the decision will have an effect on his or her interests which is different from ("beyond"64) its effect on the public at large. Here, the effect was said to be economic. It is inevitable that there will be cases where deciding whether a person's interests are adversely affected by a decision will require judgments of fact and degree. The effect to which the second and third appellants pointed was immediate and direct. In effect, each said that: "If the Minister's decision stands, 60 cf Weiss v The Queen (2005) 224 CLR 300 at 312-313 [31]-[33]; [2005] HCA 81; Assistant Commissioner Condon v Pompano Pty Ltd (2013) 87 ALJR 458 at 490-491 [137]; 295 ALR 638 at 677; [2013] HCA 7. 61 (2013) 198 LGERA 187 at 195 [29]. 62 Tooheys Ltd v Minister for Business and Consumer Affairs (1981) 36 ALR 64 at 63 Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 267 [50]; [1998] HCA 49. 64 Tooheys (1981) 36 ALR 64 at 79. and is carried into effect, I will earn less profit." By contrast, the first appellant pointed to a less immediate and direct effect. In effect, it said that: "If the Minister's decision stands, and is carried into effect, my tenant may go out of business and, if that happens, I may lose the benefit of the lease I have made." The difference between the two claims can be expressed in several different ways. Earlier in these reasons it was expressed as a difference between "would result" and "might result". But the same ideas can be expressed by reference to "direct" as opposed to "indirect" effects, or by describing one consequence as more "remote" than another. None of these expressions is, or should be, used as if it were a term of art having a single fixed meaning. And none of these expressions is, or should be, used as if, divorced from the context in which it is used, it provides a satisfactory, self-contained explanation of the application of the statute. Each is used as a means of describing the qualitative judgment that is made. Person aggrieved by a planning decision The first to third respondents submitted that deciding whether the the Minister's decision required appellants were persons aggrieved by consideration of the scope and purpose of the Act under which the Minister made that decision. The appellants submitted that, if such a principle is to be seen as established or applied by the Full Court of the Federal Court of Australia in Alphapharm Pty Ltd v SmithKline Beecham (Australia) Pty Ltd65, the principle should be disapproved. The appellants' submission should not be accepted. But its rejection does not entail the conclusion that the second and third appellants were not each a person aggrieved by the Minister's decision. As was later explained in this Court's decision in Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd66, Alphapharm concerned a regulatory scheme established by a statute which gave an exhaustive measure of judicial review at the instance of competitors or other third parties. Unsurprisingly, the conclusion reached67 in Alphapharm depended "[u]pon the true construction of [the Act's] subject, scope and purpose". 65 (1994) 49 FCR 250. See also Right to Life Association (NSW) Inc v Secretary, Department of Human Services and Health (1995) 56 FCR 50; Big Country Developments Pty Ltd v Australian Community Pharmacy Authority (1995) 60 FCR 85. 66 (1998) 194 CLR 247 at 266 [48]. 67 (1998) 194 CLR 247 at 266 [48]. See also Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 174 [16], 195-196 [84]; [2001] HCA 58. The ADJR Act provides for judicial review of decisions made under many different enactments. It should go without saying that regard must be had to the subject matter, scope and purpose of the ADJR Act in construing the words of s 3B(1)(a): "a person whose interests are adversely affected by the decision". But content cannot be given to that expression, in its application to a particular decision, without regard to the subject matter, scope and purpose of the Act under which the decision was made and the proper construction of that Act. Only then can the relationship between the impugned decision and the interests said to be affected adversely be properly identified. Often, perhaps very often, the connection between decision, interests and asserted effect will be obvious and evidently relevant. But that may not always be so, and in such a case it will be necessary68 to identify both the interest of the applicant relied on, and whether it is adversely affected by the decision, having regard to the proper construction and application of the Act under which the impugned decision was made. Reference is not made to the Act under which the decision is made for the purpose of giving some different meaning to the words of s 3B(1)(a) of the ADJR Act. Rather, reference to the Act under which the decision is made will elucidate whether there is, in the circumstances of the decision in question, a relevant and sufficient connection between the decision, the applicant's interests and the asserted effect on those interests to show that the applicant is a "person aggrieved" by the decision. In this case, the decision at issue was made under the Planning Act. Section 6 of that Act records that the Act's object is: "to provide a planning and land system that contributes to the orderly and sustainable development of the ACT – consistent with the social, environmental and economic aspirations of the people of the ACT; and in accordance with sound financial principles." The particular development approval which the appellants seek to challenge was for the development of the Giralang Local Centre. The relevant development application was supported by an "economic impact assessment". The development approval permitted, among other things, the construction of new commercial premises, including a new supermarket and retail outlets. 68 Right to Life Association (NSW) Inc (1995) 56 FCR 50 at 84 per Gummow J. At the time of the development approval, the Territory Plan, created by Ch 5 of the Planning Act, zoned the Giralang Local Centre as a "Commercial CZ4 – Local Centre Zone". By what was called the "Local Centres Development Code", the Territory Plan provided rules controlling the development of Local Centres. One of those rules was that: "A proposal to carry out development in a local centre must have regard to any significant adverse economic impact on other commercially viable local centres." All this being so, the first to third respondents' submissions that the economic interests of the second and third appellants are in some way foreign to the Planning Act (or to the subject matter, scope and purposes of that Act) cannot be sustained. It may well be right to say, as the second and third respondents did, that the Planning Act does not have as an object or purpose the "protection of the commercial interests of [individual] owners of shopping centres or supermarkets, or the protection of existing supermarkets from competition". But it by no means follows that an individual owner or operator is not adversely affected by a planning decision that will have direct commercial consequences for that owner or operator. As the Planning Act makes plain in its statement of objects69, it is concerned with the general commercial health of the Territory. So much appears from the use of the expressions "the orderly and sustainable development of the ACT", "the social, environmental and economic aspirations of the people of the ACT", and "sound financial principles". Claims of individual adverse effect are not irrelevant to the pursuit of those general objectives. Contrary to what appears to have been an implicit premise for this aspect of the first to third respondents' submissions, no sharp line can be drawn between "planning" or "amenity" considerations on the one hand, and the economic consequences of permitting a particular development on the other. Development of one area may often have immediate effects on other areas. And ultimately, that was the root of not only the appellants' concerns about the development but also their claims to be aggrieved by the decision to permit it. The second and third appellants established that they are persons aggrieved; the first appellant did not. GAGELER J. To draw a conclusion that a person meets the statutory description of "a person whose interests are adversely affected" by a decision requires: first, identification of a decision of the designated kind; second, examination of the legal or practical operation of that decision; and, third, the making of a judgment that the legal or practical operation of the decision has been to result in an adverse effect on identified interests of the person. The nature of the requisite interests, and the nature and degree of the requisite adverse effect, depend on the statutory context in which the description appears. The present context is the Administrative Decisions (Judicial Review) Act 1989 (ACT), in a form modelled on the Administrative Decisions (Judicial Review) Act 1977 (Cth). The provisions of those two Acts are relevantly indistinguishable and it is therefore convenient to refer to them both as "the ADJR Act". The ADJR Act's reference to a decision is to a decision of an administrative character made, or purported to be made, under any of a wide range of enactments. A person who meets the ADJR Act's description of a person whose interests are adversely affected by such a decision meets its further description of a person who is "aggrieved" by the decision. Meeting that further description is a condition precedent to seeking an order of review, by which the decision might be set aside, or declared to be invalid, on any one or more specified grounds. The grounds include that the person who purported to make the decision did not have jurisdiction to make the decision70 and that the decision was not authorised by the enactment in pursuance of which it was purported to be made71. The ADJR Act in that way permits a person whose interests are adversely affected by a purported decision of an administrative character, made outside the subject-matter, scope or purposes of the enactment under which it was purported to be made, to seek an order setting it aside or declaring it invalid. The ADJR Act would be self-defeating were the person denied that permission on the basis that the interests of the person so affected were themselves outside the subject- matter, scope or purposes of the same enactment. The argument of the first respondent, that the interests to which the ADJR Act refers are limited to those which fall within the subject-matter, scope and purposes of the particular enactment under which a decision was made or purported to be made, must for that reason be rejected in principle. The argument, unsurprisingly, is also unsupported by authority either in this Court or 70 Section 5(1)(c). 71 Section 5(1)(d). in the numerous decisions of the Federal Court which have now applied the ADJR Act for nearly 35 years. One of many cases which would require reconsideration were the argument to be accepted is Broadbridge v Stammers72. There a postmaster who stood as a practical matter to lose his position and accommodation as a result of a decision made under the Postal Services Act 1975 (Cth) to close a post office was held to be a person aggrieved by that decision for the purposes of the ADJR Act. The Full Court of the Federal Court adopted the earlier language of Gummow J in Australian Institute of Marine and Power Engineers v Secretary, Department of Transport73 in treating it as sufficient in the circumstances of the case that74 "there flow[ed] from the decision ... a danger and peril to the interests of the applicant that [was] clear and imminent rather than remote, indirect or fanciful, and the applicant [had] an interest in the matter of an intensity and degree well above that of an ordinary member of the public". No part of the reasoning sought to link the identified interests of the applicant in keeping his position and accommodation to the subject-matter, scope and purposes of the Postal Services Act. Alphapharm Pty Ltd v SmithKline Beecham (Australia) Pty Ltd75, on which the first respondent principally relies, does not assist the first respondent's argument. The holding of the Full Court of the Federal Court in that case was that a pharmaceutical company was not a person whose interests were affected by a decision to register its competitor's drug under the Therapeutic Goods Act 1989 (Cth) ("the TG Act") for the purposes of a provision of that Act which conferred an entitlement to administrative review of the merits of a decision made under the TG Act. There was no dispute in that case that the pharmaceutical company was a person aggrieved by the decision to deny it administrative review so as to entitle it to challenge that decision under the ADJR Act. The contextual distinction so illustrated by the case was articulated by Davies J when he explained that a review "which forms part of the process of administrative decision-making, is provided to promote the achievement of the objects of the statute" but that "the object of judicial review is to ensure that the law is observed"76. Allan v Transurban City Link Ltd77 was similarly a case about administrative review. 72 (1987) 16 FCR 296. 73 (1986) 13 FCR 124 at 133-134. 74 (1987) 16 FCR 296 at 298. 75 (1994) 49 FCR 250. 76 (1994) 49 FCR 250 at 260. Right to Life Association (NSW) Inc v Secretary, Department of Human Services and Health78, on which the first respondent also relies, was a case about judicial review under the ADJR Act, but it also does not assist the first respondent's argument. The Full Court of the Federal Court in that case upheld the dismissal of an application brought by an incorporated association under the ADJR Act for an order of review of what was identified as a decision made under the TG Act not to stop clinical trials of a substance claimed to produce abortion. One member of the Full Court, Gummow J, held that there was no decision with the result that no question arose as to whether the association was a person aggrieved. The other two members of the Full Court, Lockhart and Beaumont JJ, held that there was a decision and went on to hold that the association was not shown to have been a person aggrieved by that decision. Lockhart J placed weight on the lack of coincidence between the objects of the association (relating to raising community awareness of the sanctity of human life) and the objects of the TG Act (relating to the quality, safety, efficacy and timely availability of therapeutic drugs)79. His Honour did so, however, not to exclude the interests of the association as irrelevant to the inquiry into its potential status as a person aggrieved by the decision made under the TG Act. His Honour rather did so as a step in reasoning to the conclusion that the concern of the association with the decision was "only an intellectual, philosophical and emotional concern" of a nature and degree comparable with that which might be held by "an ordinary member of the public" and that the association was not affected by the decision "in any way to an extent greater than the public generally" 80. Big Country Developments Pty Ltd v Australian Community Pharmacy Authority81 comes no closer to assisting the first respondent. There a landlord whose tenant was a pharmacist was held not to be a person aggrieved for the purposes of the ADJR Act by a decision made under the National Health Act 1953 (Cth) ("the NHA") to recommend approval of the tenant's application for approval to supply pharmaceutical benefits from other premises to which the tenant wanted to relocate at the expiration of the lease. Lindgren J recorded a submission that, in order to qualify for the purposes of the ADJR Act, "a particular 'interest' affected must be one which falls within the 'zone of interests' contemplated by the enactment under which the decision impugned was made"82. 77 (2001) 208 CLR 167; [2001] HCA 58. 78 (1995) 56 FCR 50. 79 (1995) 56 FCR 50 at 68. 80 (1995) 56 FCR 50 at 69. 81 (1995) 60 FCR 85. 82 (1995) 60 FCR 85 at 91. Although he noted that the "private commercial interest" of the landlord was "not coincidental with the particular public interest" which underlay the relevant provisions of the NHA83, Lindgren J did not adopt that submission. His Honour's conclusion that the landlord was not a person aggrieved for the purposes of the ADJR Act was instead based on his much more precise identification of the private commercial interest of the landlord as "the prospective commercial advantage" of "having a captive pharmacist who must succumb to commercial exigencies by 'negotiating' a further lease"84. The prospect of obtaining such a "windfall benefit", Lindgren J concluded, was not the kind of "interest" which was protected by the ADJR Act, with the result that the landlord did "not qualify as a 'person aggrieved' by reason of the susceptibility of its commercial interests to adverse effects which would result from [the] decision"85. The correctness of that conclusion, based on the opportunistic and exploitative nature of the particular commercial interest of the applicant in that case, in my view, is not open to doubt. Far from supporting the first respondent's argument that the interests to which the ADJR Act refers are confined by the subject-matter, scope and purposes of the particular enactment under which the decision was made, or purported to be made, Big Country Developments illustrates the quite different proposition earlier stated by the Full Court of the Federal Court in United States Tobacco Co v Minister for Consumer Affairs86 that "interests" is used in the ADJR Act not as in "common parlance" but as the "broadest of technical terms" which "[have] long been an expression used in the law with respect to parties so as to require an involvement with a case greater than the concern of a person who is a mere intermeddler or busybody"87. What Big Country Developments highlights is that the technical term has normative content. The Full Court in United States Tobacco correctly emphasised that "[t]he necessary interest need not be a legal, proprietary, financial or other tangible interest" and need not "be peculiar to the particular person"88. The Full Court also correctly emphasised the requirement "that the applicant demonstrates 83 (1995) 60 FCR 85 at 93. 84 (1995) 60 FCR 85 at 94. 85 (1995) 60 FCR 85 at 95. 86 (1988) 20 FCR 520. 87 (1988) 20 FCR 520 at 527. 88 (1988) 20 FCR 520 at 527. genuine affection of an interest which attaches to him"89. That demonstration of genuine affection may be by reference to the legal or practical operation of the decision, and may be informed but cannot be exhausted by a consideration of the subject-matter, scope and purposes of the enactment under which the decision was made. What it means, in the language adopted by the Full Court quoting Brennan J in a different context in Re McHattan and Collector of Customs90, is that "if the interests relied on are of such a kind that a decision of the given character could not affect them directly, there must be some evidence to show that the interests are in truth affected"91. The first to third respondents astutely eschew reliance on the approach of the Court of Appeal of the Supreme Court of the Australian Capital Territory that economic interests are presumptively excluded from the purview of the ADJR Act92. The argument of the first respondent being rejected, the outcome of the appeal turns on the sufficiency of the evidence to show that particular economic interests of the appellants were adversely affected by the decision which they seek to review. The decision which the appellants seek to review was that of the first respondent to approve the application made by the second respondent on behalf of the third respondent for approval under Ch 7 of the Planning and Development Act 2007 (ACT) of a commercial development at the Giralang Local Centre which included a supermarket and speciality shops. The second and third appellants respectively operate supermarkets at the Kaleen Local Centre and at the Evatt Local Centre. The first appellant holds the crown lease at the Kaleen Local Centre and sublets the supermarket there to the second appellant. The economic evidence before the primary judge established that the proposed development at the Giralang Local Centre would be likely to result in the first year of its operation in at least an 8.5% reduction in the annual turnover of the Kaleen Local Centre and a 7.5% reduction in the annual turnover of the Evatt Local Centre. Directors of the second and third appellants each gave evidence to the effect that, depending on the scale of the reduction in turnover, each supermarket might be forced either to close or to reduce the size of its operations. A director of the first appellant gave evidence that the second appellant was an "anchor tenant" critical to ensuring that the Kaleen Local Centre 89 (1988) 20 FCR 520 at 529. 90 (1977) 18 ALR 154 at 157. 91 (1988) 20 FCR 520 at 529-530. 92 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2013) 198 LGERA 187 at 195 [29], 197 [38]. remains a viable business operation and that the closure or downsizing of its supermarket would be likely to affect the continuing profitability of the Kaleen Local Centre as a whole. No director was cross-examined. Without referring to the evidence in detail, the primary judge said93: "I am prepared to accept that the proposed development will have an adverse economic effect on the second and third [appellants]. The interest of the first [appellant] is one step removed from those of the second and third [appellants], but it is possible that its economic interests may come to be indirectly [affected] by the proposed development." His Honour went on to describe the appellants' interests, collectively, as "simply that the increased competition provided by the development will have an effect on their profitability, based on how they currently run their business"94. He went on to characterise the interests of the second and third appellants as "too remote". From that, he said, it followed that the first appellant, being "one step further removed" from the decision of the first respondent, also "[did] not have standing to challenge the decision"95. Having found that the decision would be likely to have an adverse effect on the profitability of the second and third appellants, and to have the potential adversely to affect the profitability of the first appellant, the primary judge was, in my view, wrong to dismiss those interests as too remote to allow each of the appellants properly to be characterised as a person whose interests were adversely affected by the decision. The likelihood of the decision resulting in a significant adverse effect on the profitability of the second and third appellants was sufficiently shown from demonstration of the projected reduction in turnover. The potential for the decision to result also in a significant adverse effect on the profitability of the first appellant was not a matter of mere speculation. It was sufficiently shown to arise as a real risk to which the first appellant would be subjected by reason of the same projected reduction in turnover. The effect of the decision on the economic interests of each appellant was accordingly shown by the evidence to be both real and of an intensity and degree well above the effect of the decision on an ordinary member of the public. Each, in my view, was shown to be a person whose interests were adversely affected by the decision. 93 Argos Pty Ltd v Corbell, Minister for the Environment and Sustainable Development (2012) 7 ACTLR 15 at 29 [49]. 94 (2012) 7 ACTLR 15 at 30 [53]. 95 (2012) 7 ACTLR 15 at 30 [53]. I would allow the appeal of each appellant.
HIGH COURT OF AUSTRALIA DOLORES LAVIN & ANOR APPELLANTS AND PAOLA TOPPI & ORS RESPONDENTS [2015] HCA 4 11 February 2015 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation M L D Einfeld QC with S M Golledge for the appellants (instructed by Websters Lawyers) M R Pesman SC with J T Johnson and C E Alexander for the respondents (instructed by Beazley Singleton Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Contribution – Requirement of coordinate liabilities – Where appellants and first and second respondents were co-sureties of guaranteed debt – Where first and second respondents paid creditor disproportionate amount of guaranteed debt – Where creditor gave appellants covenant not to sue – Whether first and second respondents entitled to contribution from appellants – Whether appellants and first and second respondents shared coordinate liabilities despite creditor's covenant not to sue. Words and phrases – "contribution", "contribution in equity", "coordinate liabilities", "covenant not to sue", "of the same nature and to the same extent". FRENCH CJ, KIEFEL, BELL, GAGELER AND KEANE JJ. The question in this appeal is whether a surety who pays a creditor a disproportionate amount of a guaranteed debt is entitled to recover contribution from a co-surety when the creditor has given that co-surety a covenant not to sue for payment of the guaranteed debt. The Court of Appeal of the Supreme Court of New South Wales answered this question in the affirmative, holding that the creditor's covenant not to sue the co-surety did not release the co-surety from liability under the guarantee. As a result, all co-sureties continued to share coordinate liabilities under the guarantee, so that the sureties who paid more than their proportionate share of the guaranteed debt were entitled to recover contribution from their co-surety1. As will appear from the reasons which follow, the Court of Appeal was correct. In addition, the Court of Appeal's conclusion is supported by a broader equitable view of the rights of co-sureties between each other. Background The first appellant ("Ms Lavin") and the first respondent ("Ms Toppi") were directors of, and equal shareholders in, a company, Luxe Studios Pty Ltd ("Luxe"). In 2005, Luxe purchased a property in Liverpool Street, Sydney ("the Liverpool Street property") for the purpose of conducting a photographic studio business. The purchase was funded by a loan of $4.29 million from the National Australia Bank ("the Bank"). Further loans were made by the Bank in 2007 and 2008. In October 2008, the various loans were consolidated into one loan to Luxe in the amount of $7,768,000 ("the loan"). The loan was guaranteed jointly and severally by Ms Lavin, the second appellant (a company associated with Ms Lavin), Ms Toppi, the second respondent (Ms Toppi's husband), and Luxe Productions Pty Ltd (a company jointly owned and controlled by Ms Lavin and Ms Toppi) ("the guarantors"). The provisions of the guarantee were addressed to the guarantors. Clause 6.2 provided relevantly: "You guarantee that the customer [ie Luxe] will pay NAB all the amounts which the customer owes NAB at any time. If the customer does not pay 1 Lavin v Toppi (2014) 308 ALR 598 at 611-612 [74]-[76]. Bell an amount when due, you agree to pay that amount to NAB when NAB demands it." (emphasis in original) Clause 14 of the guarantee was relevantly as follows: "What will NOT end your liability 14.2 Your obligations under this Guarantee are not affected by anything that might otherwise affect them under the law relating to sureties, including: any change in the legal capacity, rights or obligations of the customer, a co-guarantor, any other person or you; or the fact that, in relation to any amounts which the customer owes NAB or any security (whether given by the customer, you or a co-guarantor), guarantee or indemnity for them, NAB: obtains a co-guarantor or any other person; or judgement against the customer, a gives up, releases, varies or exchanges, or fails to obtain, perfect, register or realise, or deals in any other way with the security, guarantee or indemnity; grants time or any other concession to, or compounds or compromises with, or does or omits to do anything which affects the obligations of, the customer, a co-guarantor or any other person to NAB or to you; or (iii) the fact that any amounts which the customer owes NAB may not be recoverable from the customer, a co-guarantor or any other person for any reason". (emphasis in original) Bell Clause 16 of the guarantee provided, relevantly: "You give up certain rights 16.1 You waive any rights which you have as surety at any time which may be inconsistent with the provisions of this Guarantee or which would restrict NAB's rights or remedies under it." (emphasis in original) Clause 20 of the guarantee provided: "Your liability is separate to all other security NAB holds 20. Despite any rule of law or equity to the contrary: this Guarantee indemnity, guarantee, (including from you) now or later; and is additional right and to every other security, remedy NAB holds this Guarantee and NAB's rights and remedies under it and any other security, guarantee, indemnity, right, remedy or instrument which NAB has at any time continue to exist separately and do not merge with or affect each other." (emphasis in original) On 11 November 2009, Luxe went into receivership. On 3 March 2010, the Bank made demands upon each of the guarantors for payment of the balance of the loan. When those demands were not met, the Bank commenced proceedings against all of the guarantors to enforce the guarantee. On 11 May 2010, the Liverpool Street property was sold. The proceeds of sale were paid to the Bank, but Luxe remained indebted to the Bank for over $4 million. On 21 July 2010, the appellants – but not the respondents – filed a cross-claim against the Bank seeking a declaration that the guarantee was unenforceable because it had been procured in circumstances that were unconscionable within the meaning of the Trade Practices Act 1974 (Cth) or unjust within the meaning of the Contracts Review Act 1980 (NSW). On 8 September 2010, the appellants and the Bank entered into a deed of release and settlement in relation to the proceedings between them ("the deed"). By cl 3 of the deed, Ms Lavin agreed to pay the Bank $1.35 million in respect of Bell the guaranteed debt and approximately $1.73 million in respect of other personal loans ("the settlement sum"). By cl 8(a) of the deed, the appellants agreed to release the Bank from all claims in respect of the guarantee; and, by cl 8(b) of the deed, the Bank covenanted not to sue the appellants in respect of the guarantee, provided Ms Lavin paid the settlement sum. Clause 8(b) of the deed provided for the filing of two consent judgments upon the settlement sum being paid: one judgment dismissing the Bank's claim against the appellants, the other dismissing the appellants' cross-claim against the Bank. Clause 8(c) of the deed provided, relevantly: "Noting [scil, Nothing] in this deed, compromises, prejudices or affects NAB's rights against Neil Cunningham [the second respondent], Paola Toppi, Luxe Productions Pty Ltd ... and/or Luxe ... whatsoever, including without limitation in respect of the Guarantee". The settlement sum was eventually paid to the Bank and the proceedings between the Bank and the appellants were dismissed by consent. In early 2011, Ms Toppi and her husband sold their home and used the proceeds of sale to pay the balance of the guaranteed debt, which was then approximately $2.9 million. Upon payment of that amount, the guarantors' obligations to the Bank under the guarantee were discharged. The proceedings The respondents2 commenced proceedings in the Equity Division of the Supreme Court of New South Wales claiming, inter alia, contribution from the appellants in the amount of $773,661.04, being an amount equal to half the difference between the respective amounts paid by the appellants and the respondents in discharging the guarantee. It is not apparent that the third respondent paid anything towards the discharge of the guarantee. The basis of its claim to contribution is thus unclear. Further references to "the respondents" should be treated as references to the first and second respondents only. Bell The appellants resisted the respondents' claim on the basis that the appellants and the respondents were not under "co-ordinate liabilities"3, ie liabilities "of the same nature and to the same extent"4, because, by reason of the Bank's covenant not to sue, the respondents' liability under the guarantee remained enforceable while the appellants' liability was not. Decision of the primary judge The primary judge (Rein J) considered5 himself bound to reject the appellants' submission by reason of the decision of the Court of Appeal of the Supreme Court of New South Wales in Carr v Thomas6, which held7 that a creditor's covenant not to sue a particular co-surety had no effect on the rights of contribution of the co-sureties among themselves. His Honour observed8 that, apart from being authority binding upon him, Carr v Thomas had the "considerable attraction ... of precluding one surety, with the assistance of the creditor, from being able to saddle other sureties with a disproportionate amount of liability." His Honour ordered the appellants to pay contribution for the amount claimed (minus a small deduction on account of interest, which is no longer of any moment)9. 3 Albion Insurance Co Ltd v Government Insurance Office (NSW) (1969) 121 CLR 342 at 350; [1969] HCA 55. 4 Burke v LFOT Pty Ltd (2002) 209 CLR 282 at 293 [15], 299 [38]; [2002] HCA 17. See also Friend v Brooker (2009) 239 CLR 129; [2009] HCA 21; HIH Claims Support Ltd v Insurance Australia Ltd (2011) 244 CLR 72; [2011] HCA 31. 5 Toppi v Lavin [2013] NSWSC 1361 at [17]. [2009] NSWCA 208. 7 Carr v Thomas [2009] NSWCA 208 at [38]. 8 Toppi v Lavin [2013] NSWSC 1361 at [17]. 9 Toppi v Lavin [2013] NSWSC 1361 at [50]. Bell Decision of the Court of Appeal In the Court of Appeal, the appellants argued that Carr v Thomas was unsupported by authority and clearly wrong in principle. Leeming JA (with whom Macfarlan and Emmett JJA agreed) rejected that argument. Leeming JA concluded10 that, while the precise question decided by Carr v Thomas had not arisen in any earlier case, the decision in that case was correct as a matter of principle. His Honour said11: "In point of principle, a covenant not to sue (in the usual form) does not alter an existing liability. Giving such a covenant means merely that the covenantor is in breach if it does sue." Leeming JA proceeded on the basis that the Bank's covenant not to sue was premised on the continuing liability of the covenantees. Because the covenant did not extinguish the appellants' liability under the guarantee, it followed that the appellants and the respondents continued to share liabilities of the same nature and extent so as to entitle the respondents to recover contribution from the appellants. Leeming JA also rejected the appellants' contention that they received no benefit from the respondents' discharge of the balance of their liability to the Bank. His Honour held12 that, since the appellants remained liable under the guarantee notwithstanding the Bank's covenant not to sue, the appellants benefitted from the respondents' payment of $2.9 million. In this regard, his Honour said13: "Prior to the payment, [the appellants were] liable to pay [their] share of the guaranteed debt, albeit that the bank had promised not to enforce it. After the payment, there was no guaranteed debt left to pay." 10 Lavin v Toppi (2014) 308 ALR 598 at 614 [90]. 11 Lavin v Toppi (2014) 308 ALR 598 at 611 [73]. 12 Lavin v Toppi (2014) 308 ALR 598 at 612 [76]. 13 Lavin v Toppi (2014) 308 ALR 598 at 612 [76]. Bell The appeal to this Court On 12 September 2014, French CJ and Gageler J granted the appellants special leave to appeal to this Court. In this Court, the appellants submitted that the Court of Appeal erred in holding that the respondents and appellants shared coordinate liabilities of the same nature and extent at the time the respondents paid the guaranteed debt. The appellants argued that their liability was "qualitatively different"14 from the respondents' liability in that the respondents' liability was enforceable by the Bank while the appellants' liability was not. The appellants also argued that the Court of Appeal erred in holding that the appellants benefitted from the respondents' discharge of the guarantee. It was said that the discharge of the guarantee conferred no real or practical benefit on the appellants because, by the time the respondents discharged the guarantee, no liability under the guarantee could be enforced against the appellants. This lack of practical benefit was said to be fatal to the respondents' claim because the purpose of the doctrine of contribution is the prevention of unjust enrichment by one co-surety at the expense of another. The appellants' argument seized upon the timing of the covenant not to sue. It was said that the respondents' right to contribution depended on the respondents and appellants sharing coordinate liabilities at the date of the respondents' payment of the balance of the guaranteed debt. It was said that only at that time could a right to seek contribution accrue to the respondents; yet at that time the appellants and respondents no longer shared coordinate liabilities because the appellants could no longer be sued by the Bank. There are two answers to the appellants' argument. The first is that given by the Court of Appeal, ie that the Bank's covenant not to sue the appellants did not extinguish, but indeed assumed, the appellants' ongoing liability for the guaranteed debt. Accordingly, the appellants and respondents shared coordinate liabilities to the Bank under the guarantee both before and after the covenant not to sue. The second answer is that the respondents' right to contribution from the appellants was cognisable in equity even before the respondents made their disproportionate payment to the Bank and could not be defeated by the separate 14 HIH Claims Support Ltd v Insurance Australia Ltd (2011) 244 CLR 72 at 92 [55]. Bell agreement of the Bank and the appellants. Before elaborating upon these points, the juridical foundation of the right to contribution should be noted. Foundation of the right to contribution The rationale of the right to contribution, both at law and in equity, was described by Kitto J in Albion Insurance Co Ltd v Government Insurance Office (NSW)15 "as one of natural justice" which ensures "that persons who are under co-ordinate liabilities to make good the one loss (eg sureties liable to make good a failure to pay the one debt) must share the burden pro rata."16 In cases of suretyship, the concern is to ensure that the common burden of suretyship is borne equally as between co-sureties, so that the exercise by a creditor of its contractual right under its guarantee to recover the guaranteed debt in full from one of several co-sureties does not leave that surety to bear a disproportionate share of the burden of suretyship. The appellants and respondents each agreed to pay the full amount of the guaranteed debt. Each of them became liable to pay that debt upon demand by the Bank under cl 6.2 of the guarantee. In Mahoney v McManus17, Gibbs CJ (with whom Murphy and Aickin JJ agreed) said that: "the doctrine of contribution is based on the principle of natural justice that if several persons have a common obligation they should as between themselves contribute proportionately in satisfaction of that obligation. The operation of such a principle should not be defeated by too technical an approach". The appellants' argument is both novel and unduly technical. Only upon such an approach could there be any question at all as to the existence of the common obligation necessary to found the respondents' right to contribution. 15 (1969) 121 CLR 342 at 349-350. 16 See also HIH Claims Support Ltd v Insurance Australia Ltd (2011) 244 CLR 72 at 17 (1981) 180 CLR 370 at 378; [1981] HCA 54. Bell Coordinate liabilities From the moment of Luxe's default, or at the very latest from the Bank's demand on the guarantors, each of the guarantors was under a common obligation to pay to the Bank the whole of the guaranteed debt. As persons jointly or severally liable in respect of the same debt, each of them was bound, among themselves, to contribute equally to the discharge of that liability18. At that time, each of them shared "a common interest, and a common bur[d]en"19 in respect of the guaranteed debt. Leeming JA was correct to hold that the Bank's covenant not to sue the appellants did not discharge their liability under the guarantee. The significance, in the law of suretyship, of a covenant not to sue is that the covenant does not operate as a discharge of the guaranteed liability. The utility of the device of the covenant not to sue is that it does not discharge the liability of the covenantee under the guarantee, and so avoids the discharge of the liability of one surety operating to release all co-sureties20. That utility is not negated by the ability of the creditor and co-sureties to contract for the preservation of liability in the event of discharge, as the appellants argue was achieved by cl 14.2 of the guarantee. The covenant not to sue removes the need for the creditor to rely on such contractual preservation of liability. It should be noted here that counsel for the appellants disavowed any suggestion that the Bank's covenant not to sue effected a discharge of the appellants' liability under the guarantee. The appellants' counsel insisted that the covenant not to sue effected a qualitative alteration in the appellants' liability under the guarantee which was such as to preclude a claim for contribution by a co-surety. That contention has no support in authority. Counsel for the appellants emphasised passages in the authorities to the effect that "[t]he nature or quality of the obligations is critical"21, but none of these passages support the proposition that a covenant 18 Burke v LFOT Pty Ltd (2002) 209 CLR 282 at 292-293 [14]-[16]. 19 Dering v Earl of Winchelsea (1787) 1 Cox Eq Cas 318 at 322 [29 ER 1184 at 20 Bateson v Gosling (1871) LR 7 CP 9; Murray-Oates v Jjadd Pty Ltd (1999) 76 SASR 38 at 53 [83]. 21 HIH Claims Support Ltd v Insurance Australia Ltd (2011) 244 CLR 72 at 87-88 [37]. See also Albion Insurance Co Ltd v Government Insurance Office (NSW) (1969) 121 CLR 342 at 345-346; Government Insurance Office of New South (Footnote continues on next page) Bell between a creditor and a co-surety affects the co-surety's continuing liability to a claim for contribution from another co-surety. The appellants have pointed to no decided case or dicta which support the notion that a right to contribution can be defeated by an agreement between a creditor and a co-surety that the creditor will not pursue legal action against the co-surety. That the Bank was barred from enforcing the appellants' liability by action did not extinguish the appellants' liability to the Bank and did not alter the appellants' obligations vis-à-vis the respondents. As Glanville Williams said22: "The right of contribution among co-debtors is independent of any present right of the principal creditor. Thus the right of contribution exists although the right of the principal [creditor] has become statute-barred23, or (it is submitted) merged by judgment against one debtor". While the Bank's covenant not to sue meant that the liability of the appellants was not enforceable by legal proceedings, it remained enforceable by other means such as reliance on rights of recoupment under other securities (if any) between the Bank and the appellants. Because the appellants were, and remained, liable under the guarantee, the appellants and respondents shared coordinate liabilities, which entitled the respondents to recover contribution. Another novel aspect of the appellants' argument was their insistence that the existence of coordinate liabilities, and the gaining of a benefit by the payment of the co-surety claiming contribution, are necessarily separate and distinct elements of a right of action for contribution. Once again, the appellants have pointed to no decided case or dicta supporting that contention. Once it is understood that the concern of the doctrine is to ensure that the burden of a common liability is borne equally, it can be seen that the existence of coordinate liabilities and benefit from payment are not separate and distinct elements of the right. When a common liability is discharged by a surety, the discharge of the liability inevitably benefits a co-surety in that, without a right of contribution in Wales v Crowley [1975] 2 NSWLR 78 at 83; BP Petroleum Development Ltd v Esso Petroleum Co Ltd 1987 SLT 345 at 348. 22 Glanville Williams, Joint Obligations, (1949), §85. 23 Wolmershausen v Gullick [1893] 2 Ch 514; Gardner v Brooke [1897] 2 IR 6. Bell the surety, the co-surety who pays less than his or her fair share is unjustly enriched. As was said by McHugh J in Burke v LFOT Pty Ltd24: "An order of contribution prevents the injustice that would otherwise flow to the plaintiff by the defendant being enriched at the plaintiff's expense in circumstances where they have a common obligation to meet the liability which the plaintiff has met or will have to meet25." Finally under this heading, as a practical matter, the suggestion that the appellants received no benefit from the respondents' discharge of the balance of the debt sits ill with cl 8(c) of the deed. The terms of this provision suggest that the prospect of the recovery of full payment from the respondents had a positive effect upon the Bank's willingness to give the appellants the benefit of the covenant not to sue. Contribution in equity Counsel for the respondents submitted that this case does not call for an exploration of the outer limits of the availability of contribution between co-sureties, but is a clear case for contribution. That submission is correct, and that may explain why, as Leeming JA noted26, in no case prior to Carr v Thomas has the precise question presented by this case arisen for decision. However that may be, the irresistible strength of the respondents' case is readily apparent when the question is viewed through the lens of equity. In Craythorne v Swinburne, it was made clear that once a creditor calls upon co-sureties to pay the guaranteed debt, the right of a co-surety to contribution cannot be defeated by the acts of the creditor. In that case, "Upon the relation of principal and surety some things are very clear. It has been long settled, that, if there are co-sureties by the same 24 (2002) 209 CLR 282 at 299 [38]. 25 Bonner v Tottenham and Edmonton Permanent Investment Building Society [1899] 1 QB 161 at 174; Mahoney v McManus (1981) 180 CLR 370 at 388. 26 Lavin v Toppi (2014) 308 ALR 598 at 608 [55]. 27 (1807) 14 Ves Jun 160 at 164-165 [33 ER 482 at 483-484]. Bell instrument, and the creditor calls upon either of them to pay the principal debt, or any part of it, that surety has a right in this Court, either upon a principle of equity, or upon contract, to call upon his co-surety for contribution ... [W]hether [co-sureties] are bound by several instruments, or not, whether the fact is or is not known, whether the number is more or less, the principle of Equity operates in both cases; upon the maxim, that equality is Equity: the creditor, who can call upon all, shall not be at liberty to fix one with payment of the whole debt; and upon the principle, requiring him to do justice, if he will not, the Court will do it for him." (emphasis added) More recently, in Friend v Brooker28, French CJ, Gummow, Hayne and "With a claim to contribution, as is the position generally with the intervention of equity to apply its doctrines or to afford its remedies, the plaintiff must show the presence of 'an equity' founding the case for that intervention29. The 'natural justice' in the provision of a remedy for contribution is the concern that the common exposure of the obligors (or 'debtors') to the obligee (or 'creditor') and the equality of burden should not be disturbed or be defeated by the accident or chance that the creditor has selected or may select one or some rather than all for recovery30. Were equity not to intervene, then it would remain within the power of the creditor so to act as to cause one debtor to be relieved of a responsibility shared with another31. Equity follows the law in the sense that it does not seek to direct the manner of exercise of the rights of the creditor, but equity does make an adjustment between the debtors. Thus equity does 28 (2009) 239 CLR 129 at 148 [38]-[39]. 29 See The Commonwealth v Verwayen (1990) 170 CLR 394 at 434-435; [1990] HCA 39; Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 216 [8], 233 [64], 259 [138]; [2001] HCA 63. 30 Tombs v Roch (1846) 2 Coll 490 at 499 [63 ER 828 at 832]; Duncan, Fox & Co v North and South Wales Bank (1880) 6 App Cas 1 at 12-14; Mahoney v McManus (1981) 180 CLR 370 at 387-388; Scholefield Goodman and Sons Ltd v Zyngier [1986] AC 562 at 570-571. 31 Story, Commentaries on Equity Jurisprudence, 3rd Eng ed (1920), §493. Bell not interfere with the action of the creditor but seeks to ensure the sharing of the burden between those subjected to it32. The equity to seek contribution arises because the exercise of the rights of the obligee or creditor ought not to disadvantage some of those bearing a common burden; the equity does not arise merely because all the obligors derive a benefit from a payment by one or more of them33. As explained in United States authority34, contribution is an attempt by equity to distribute equally, among those having a common obligation, the burden of performing it, so that without that common obligation there can be no claim for contribution." At the heart of the appellants' argument is an invitation to accept that it is in "the power of the creditor to select his own victim; and, upon motives of mere caprice or favouritism, to make a common burden a most gross personal oppression."35 That invitation cannot be accepted. In the present case, the Bank's covenant not to sue the appellants is the very kind of preferential treatment of a co-surety by a creditor to by Lord Eldon LC serves to prevent. the "principle of Equity" referred that The appellants' argument, in focusing upon the timing of the respondents' payment of the guaranteed debt after the giving of the covenant not to sue, was premised on the notion that the respondents' right to contribution arose only upon payment by the respondents of more than their fair share of the guaranteed debt. This premise reflects the approach of the common law to the pleading and proof of the elements of a cause of action for the payment of money; but it does not reflect the approach of equity36. In particular, it takes an unduly narrow view of the extent to which a court of equity will recognise, protect and enforce the equity to seek contribution. 32 Pomeroy's Equity Jurisprudence, 5th ed (1941), vol 2, §§406, 411. 33 Mahoney v McManus (1981) 180 CLR 370 at 387. 34 Nova Information Systems Inc v Greenwich Insurance Co 365 F 3d 996 at 1006 (2004); Corpus Juris Secundum (2007 ed), vol 18, "Contribution", §5. 35 Story, Commentaries on Equity Jurisprudence, 3rd Eng ed (1920), §493. 36 Jenyns v Public Curator (Q) (1953) 90 CLR 113 at 118-119; [1953] HCA 2. Bell It may be accepted that, in an action at common law, payment of a disproportionate amount is an essential element of the payer's cause of action against a co-surety for payment of money by way of contribution; but equity recognises and protects the co-surety's equity to contribution in a more flexible and comprehensive way. In McLean v Discount and Finance Ltd37, Starke J said: "At common law, no doubt, a surety could not maintain an action for contribution or money paid until he had actually paid more than his just proportion of the principal debt. But the authorities support the view that in equity the right to contribution can be declared before actual payment is made or loss sustained provided that such payment or loss is imminent38." In Friend v Brooker39, French CJ, Gummow, Hayne and Bell JJ said: "In McLean v Discount and Finance Ltd40 Starke J explained that at common law an action for contribution cannot be maintained in advance of actual payment of more than the just proportion of the principal obligation; on the other hand, equity acts quia timet where the apprehended over-payment appears sufficiently imminent." In the present case, the commencement of proceedings by the Bank removed any question as to whether enforcement of the respondents' liability to the Bank was imminent. While in an action at common law payment by the surety is an essential element of the right of action for payment of money, in equity the issue is whether, and the extent to which, an equity to contribution is enforceable. The extent of any equitable right or entitlement has been said to be commensurate with the orders which a court of equity may make to protect or enforce the right 37 (1939) 64 CLR 312 at 341; [1939] HCA 38. 38 Wolmershausen v Gullick [1893] 2 Ch 514. 39 (2009) 239 CLR 129 at 152 [52]. 40 (1939) 64 CLR 312 at 341. Bell or entitlement41. It may be accepted that the respondents would not have been entitled to an order for payment of contribution from the appellants until they had paid more than their fair share of the guaranteed debt. But from the time the appellants and respondents were called upon under the guarantee, the respondents' equity to recover contribution was sufficiently cognisable that it could not be defeated by the very kind of dealing between creditor and co-surety that the equitable principle seeks to prevent. Prior to the Bank's covenant not to sue and the payment of the guaranteed debt, the respondents' equity was sufficiently cognisable in a court of equity to support a declaration that the appellants were obliged to make contribution to the discharge of the guaranteed debt. In this regard, the plurality in Friend v Brooker42 said: "[I]n Woolmington v Bronze Lamp Restaurant Pty Ltd43, Needham J, whose opinion in such matters deserves great weight, said that as the authorities then stood, none had gone to the length of deciding that the plaintiff surety could maintain an equity suit for contribution without either having paid at least the amount due by the plaintiff under the guarantee or being under a liability by judgment to pay the full amount. However, Needham J was prepared to go so far as to make a declaration and order for contribution in favour of a surety who satisfied the court that he was willing able and prepared to pay at least his share of the principal debt44. In the case before him, this was not so and relief was refused." No doubt any declaration of the respondents' right to actual payment by the appellants would have been conditioned upon the respondents themselves meeting their obligations under the guarantee or proving their readiness, 41 Tailby v Official Receiver (1888) 13 App Cas 523 at 546-549; Haque v Haque [No 2] (1965) 114 CLR 98 at 124-125; [1965] HCA 38; Brown v Heffer (1967) 116 CLR 344 at 349; [1967] HCA 40; Chang v Registrar of Titles (1976) 137 CLR 177 at 181-182, 184-185, 189-190; [1976] HCA 1; Legione v Hateley (1983) 152 CLR 406 at 446-447; [1983] HCA 11; KLDE Pty Ltd v Commissioner of Stamp Duties (Q) (1984) 155 CLR 288 at 296-297, 304-305; [1984] HCA 63. 42 (2009) 239 CLR 129 at 153 [57]. 43 [1984] 2 NSWLR 242 at 245. 44 [1984] 2 NSWLR 242 at 245. Bell willingness and ability to do so. But to say this is merely to recognise that a plaintiff must do equity when seeking equity45. It is not to suggest that a plaintiff's equity may be defeated by dealings between creditor and co-surety. Conclusion The appeal should be dismissed with costs. 45 Lodge v National Union Investment Co Ltd [1907] 1 Ch 300 at 312; Langman v Handover (1929) 43 CLR 334 at 343, 345-346, 351-352, 357; [1929] HCA 42.
HIGH COURT OF AUSTRALIA APPELLANT RESPONDENT APPELLANT RESPONDENT APPLICANT RESPONDENT Matter No A23/2007 HML AND THE QUEEN Matter No A19/2007 AND THE QUEEN Matter No A28/2007 OAE AND THE QUEEN Matter No A23/2007 Appeal dismissed. SB v The Queen OAE v The Queen [2008] HCA 16 24 April 2008 A23/2007, A19/2007, A28/2007 ORDER Matter No A19/2007 Appeal dismissed. Matter No A28/2007 Special leave to appeal granted. Appeal treated as instituted, heard instanter and dismissed. On appeal from the Supreme Court of South Australia Representation Matter No A23/2007 T A Game SC with C S L Abbott for the appellant (instructed by Herman Bersee) C J Kourakis QC, Solicitor-General for the State of South Australia with S A McDonald for the respondent (instructed by Director of Public Prosecutions Matter No A19/2007 A L Tokley with C S Gallagher for the appellant (instructed by Gallagher & Co) A P Kimber with K G Handshin for the respondent (instructed by Director of Public Prosecutions (SA)) Matter No A28/2007 N M Vadasz for the applicant (instructed by Kyrimis Lawyers) M G Hinton QC with K G Handshin for the respondent (instructed by Director of Public Prosecutions (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS SB v The Queen OAE v The Queen Criminal law – Evidence – Similar facts – Sexual crimes – "Uncharged acts" – Relevance – Admissibility – Applicability of test in Pfennig v The Queen (1995) 182 CLR 461. Criminal law – Evidence – Similar facts – Standard of proof – Whether "uncharged acts" must be proved beyond reasonable doubt – Directions to jury. Practice and procedure – Application to amend notice of appeal – Whether leave should be granted to amend notice of appeal to raise issue of admissibility of evidence, to which no objection was taken at trial. Words and phrases – "context", "guilty passion", "propensity evidence", "relationship evidence", "relevance", "similar fact evidence", "uncharged acts". Evidence Act 1929 (SA), ss 34CA, 34I. GLEESON CJ. These matters raise issues concerning the admissibility at a criminal trial of a certain kind of similar fact evidence, and the proper directions to be given to a jury in the event that such evidence is admitted. In each matter, the evidence was that of a complainant who, in addition to giving an account of specific acts the subject of the charge or charges in an indictment, testified that other such acts had taken place between the accused and the complainant. This was described in argument as evidence of uncharged acts. I am content, for the purpose of stating my reasons, to adopt the description used in argument, although I do not suggest that it would always, or even usually, be a helpful phrase in a trial judge's directions to a jury. Of course, evidence of uncharged acts might come from a source other than the complainant; and uncharged acts of the same kind as the charged acts are themselves a particular example of evidence that reveals criminal or discreditable conduct of an accused other than the conduct with which he or she is charged. There are wider issues involved. In cases of alleged child sexual abuse, it is not uncommon for a complainant to assert that the incidents the subject of charges against the accused were part of a pattern of behaviour that extended over a period of time, perhaps many years. There is nothing new about this kind of evidence, although in recent years the increase in reporting of, and prosecution for, child sexual abuse has drawn wider attention to some of the problems involved. In KRM v The Queen1, McHugh J pointed out that, in cases of sexual offences, evidence of uncharged acts between the accused and the complainant has long been admitted2. He said that such evidence tended to explain the relationship of the parties or made it more probable that the charged acts occurred. In a footnote, he referred to a number of authorities, the first of which was R v Ball3, a decision of the House of Lords in 1910. In that case, which concerned incest, the Lord Chancellor referred to the law "which is daily applied in the Divorce Court ... to establish ... the existence of a sexual passion"4. His Lordship was referring to evidence of "guilty relations between the parties" in aid of proof of what was then the matrimonial offence of adultery. In R v Hartley5, the English Court of Criminal Appeal said, of a complainant in a case of a sexual offence, that "where a person alleges that an offence such as that with which we are concerned here has been committed against him and that the occasion was not an isolated one, he is entitled to give evidence that the offence was indulged in habitually." The (2001) 206 CLR 221; [2001] HCA 11. (2001) 206 CLR 221 at 230 [24]. [1911] AC 47 at 71. [1941] 1 KB 5 at 6-7. reasons why, and the circumstances in which, that is so must be examined in order to decide the present matters. In some Australian jurisdictions, there are statutory provisions governing these questions. The matters before the Court (two appeals and an application for special leave to appeal) come, however, from South Australia, where it is the common law that must be applied6. Since there is a question of the admissibility of evidence, the logical starting point is relevance. Relevance and proof Evidence is information which, according to certain governing general principles and more detailed rules, will be received by a court for the purpose of deciding issues of fact that arise for its decision. The issues in civil cases are defined by the pleadings or other corresponding procedure. They are determined by the principles of substantive law that apply to the dispute, and by choices made by the parties within the boundaries set by those principles. In a criminal trial of an indictable offence, the indictment identifies the alleged offence. The prosecution sets out to prove the elements of the offence, that is to say, the specific offence alleged to have been committed by the accused. The jury will be directed, as a matter of law, that for a verdict of guilty it is necessary to be satisfied beyond reasonable doubt of those elements7. The elements of the offence, to the extent to which they are disputed, identify the facts in issue, which may be refined by particulars8. Depending upon the way in which the prosecution seeks to prove its case, or the way in which the defence is conducted, it may appear, as a matter of fact, that an element of the offence charged will not be established beyond reasonable doubt unless some subsidiary fact, relevant to a fact in issue, is proved to that standard. However, the legal requirement as to onus and standard of proof is related to the elements of the offence charged. In some cases, there may be only one available path to a conclusion of guilt, but often that is not so. Jurors are commonly instructed that they may be selective in their approach to the evidence, and even in their approach to different parts of the evidence of the one witness. 6 See, for example, R v Nieterink (1999) 76 SASR 56. 7 Shepherd v The Queen (1990) 170 CLR 573 at 579-580; [1990] HCA 56. The elements, or what Dawson J described as the "essential ingredients" of the elements, of an offence are identified by statute and/or common law, and by the terms of the indictment. It is unnecessary, for present purposes, to go into the question of the circumstances in which the prosecution will be limited by particulars of a charge or by the conduct of its case. The basic principle of admissibility of evidence is that, unless there is some good reason for not receiving it, evidence that is relevant is admissible9. Evidence that is not relevant is inadmissible; there is then no occasion to consider any more particular rule of exclusion. Reasons for not receiving relevant evidence may relate to its content, or to the form or circumstances in which it is tendered. Evidence is relevant if it could rationally affect, directly or indirectly, the assessment of the probability of the existence of a fact in issue in the proceedings10. That directs attention, in a criminal case, to the elements of the offence charged, the particulars of those elements, and any circumstances which bear upon the assessment of probability. The prosecution may set out to establish that an accused had a motive to commit an offence charged. Motive may rationally affect the assessment of the probability of the existence of one or more of the elements of an offence. Evidence that tends to establish motive, therefore, may rationally affect such assessment. If so, it is relevant. When the prosecution sets out to establish motive, that is often a step in the prosecution case that is not indispensable. If it is established, motive may support (sometimes powerfully) the prosecution case, but juries are often told that failure to establish motive does not mean the case must fail. The legal necessity is to establish beyond reasonable doubt the elements of the offence. What that entails as a matter of fact may depend upon the circumstances of the particular case. Some of the statements made in Chamberlain v The Queen [No 2]11 could have been interpreted as abrogating the fundamental legal principle, but what was there said was subsequently clarified in Shepherd v The Queen12. Information may be relevant, and therefore potentially admissible as evidence, where it bears upon assessment of the probability of the existence of a fact in issue by assisting in the evaluation of other evidence. It may explain a statement or an event that would otherwise appear curious or unlikely. It may cut down, or reinforce, the plausibility of something that a witness has said. It may provide a context helpful, or even necessary, for an understanding of a narrative. An example is some evidence given in R v Wickham13. A female complainant in a child sex abuse case gave an account, directly relevant to a charge, of a sexual encounter she had with her father when she was 14 years old. She said that her 9 This principle is reflected in s 56 of the Evidence Act 1995 (Cth). 10 Washer v Western Australia (2007) 82 ALJR 33 at 35-36 [5]; 239 ALR 610 at 612; [2007] HCA 48; Goldsmith v Sandilands (2002) 76 ALJR 1024 at 1025 [2]; 190 ALR 370 at 371; [2002] HCA 31; cf Evidence Act 1995 (Cth), s 55. 11 (1984) 153 CLR 521; [1984] HCA 7. 12 (1990) 170 CLR 573. 13 Unreported, New South Wales Court of Criminal Appeal, 17 December 1991. father entered her bed, and had sexual intercourse with her. After some brief conversation, they both went to sleep. The father denied that any such event occurred. There was other evidence to show a history of similar sexual activity before the occasion in question. In the absence of that evidence, the complainant's account of what otherwise would have been presented as a single, and apparently isolated, act might have been regarded by the jury as difficult to believe. The complainant expressed no surprise when her father came to her bed. She made no protest. She behaved as though this was a common occurrence. She said that, in fact, it was a common occurrence. If she had not been permitted to say that, her evidence could have appeared hard to believe. To have put her evidence forward as though she were describing an isolated incident would have been misleading, and, it might be added, unfair. Jurors are told that, in evaluating evidence, they should use their common sense and their experience of life. Whether or not expressly invited to do so, jurors are likely to assess competing versions of events or conduct by reference to their ideas of normal or predictable behaviour. In R v Boardman14 in a passage later cited with approval in this Court, Lord Cross of Chelsea said that there are cases in which to exclude evidence of the kind presently in question would be an affront to common sense. The law must apply a more definite test, but common sense and relevance are closely related. A jury's assessment of some kinds of evidence is likely to be based more upon common sense than upon scientific method. Evidence of uncharged acts in child sexual abuse cases may also be relevant because of a matter mentioned above, that is, motive. As both Deane J15 and McHugh J16 have said, evidence which tends to show that a father has treated a daughter as an object of sexual gratification may tend to show a motive for committing the offence charged. If it appears that a parent has a sexual desire for a child, then that may make more credible the child's allegation that a particular alleged sexual incident occurred. There may be little difficulty in establishing the relevance of uncharged acts, although that is by no means the end of the question of admissibility. Specifying the nature of the relevance may bear both upon admissibility and upon the appropriate directions to a jury. Words such as "relationship" and "propensity" may cover both aspects of potential relevance already mentioned, but they may cover more, and may require closer definition before their application to the circumstances of a given case. Evidence of a sexual interest of a father in a child is evidence of a certain kind of propensity, a kind of propensity 14 [1975] AC 421 at 456. 15 B v The Queen (1992) 175 CLR 599 at 610; [1992] HCA 68. 16 KRM v The Queen (2001) 206 CLR 221 at 230 [24]. that jurors may regard as bearing upon the probability that the testimony of the child as to a particular act is true. As to the potential use of uncharged acts to evaluate a complainant's evidence by furnishing an explanation for apparent lack of surprise, or protest, Gaudron J said, in Gipp v The Queen17, that evidence of general sexual abuse is relevant and admissible on that basis, but only if the conduct of the defence case raises such considerations. I regret that I am unable to agree. Questions of admissibility of a complainant's evidence of uncharged acts usually arise for decision either before the trial or during the evidence-in-chief of the complainant. There may be no relevant conduct of the defence case by reference to which a decision can be made. Furthermore, the conduct of the defence case may not be a fixed point of reference. It is important not to overlook the legitimate opportunism that may be involved in the conduct of a defence under an accusatorial system of trial. It is one thing to require a prosecutor to give particulars. It is another thing to bind defence counsel to a certain line of argument. It should also be remembered that jurors, in assessing probabilities, are not bound by the conduct of defence counsel. When jurors evaluate the evidence of a complainant they are not limited to considering arguments advanced by the lawyers. If the complainant's evidence concerning a charge were given as though it were an account of an isolated event, then regardless of the line taken by the defence it might create a false impression, and that impression could colour the jury's assessment of the evidence. In some cases, the possibility is too obvious to be ignored, regardless of the line adopted in defence. An example is provided by the evidence, in the first of these three matters, concerning the method of persuasion that the complainant was required to use in order to obtain permission to go shopping. If she had described the conduct involved in that transaction as if it were an isolated incident it might have sounded like fantasy. Jurors bring their ideas of normal behaviour to the assessment of probabilities. Trial judges and advocates cannot ignore that fact, and the law of evidence must take account of it. It is the tendency of evidence that determines its relevance. The trial judge decides whether evidence could rationally affect the jury's assessment of the probability of the existence of a fact in issue. The ultimate effect of the evidence is a question of fact to be decided by the jury. The kind of similar fact evidence in question, that is, a complainant's evidence of uncharged acts, even when received and used as evidence of motive, is unlikely to compel, as a matter of logic, a conclusion that the charged offence or offences occurred. To prove that a person did something many times does not compel a conclusion that he did it again. However, it might make it more likely 17 (1998) 194 CLR 106 at 113 [12]; [1998] HCA 21. that sworn testimony that he did it again is true. People do not act in accordance with all their inclinations at every opportunity, but proof of a person's inclinations may provide strong support for direct testimony as to that person's conduct. Decisions as to the relevance of evidence are made by asking how, if accepted, it bears on the assessment of the probability of a fact in issue. Assessments of probability are rarely the subject of syllogistic reasoning. Exclusion Whatever the purpose for which similar fact evidence is adduced, it has an effect which the law regards as capable of providing a good reason for excluding it: if accepted, it shows a disposition or tendency to engage in crime or other discreditable conduct. If that is all it shows, and the prosecution adduces the evidence for the purpose of leading to the conclusion that the accused is a person likely from his criminal conduct or character to have committed the offence for which he is being tried, then the law excludes such evidence as a matter of fundamental principle18. The purpose just described is often referred to as propensity, although that itself is ambiguous. The reason for the exclusion is not the irrelevance of propensity, but its prejudicial effect. In this context, prejudice means the danger of improper use of the evidence. It does not mean its legitimate tendency to inculpate. If it did, probative value would be part of prejudicial effect. It is the risk that evidence of propensity will be taken by a jury to prove too much that the law seeks to guard against. In addition to the possibility of prejudice just mentioned, which is common to most similar fact evidence, there is a further prejudicial effect of the kind of similar fact evidence with which we are presently concerned, that is, a complainant's evidence of uncharged acts. Typically, as in the present matters, the uncharged acts will be disputed, and sometimes the only evidence of them will be that of the complainant. The form in which the evidence emerges may create a serious risk of unfairness. It may range from a general assertion that conduct similar to that the subject of the charges had occurred on other occasions, perhaps over many years, to a detailed account of other specific acts. The accused is on trial for the charged offences. He may seek to deal with the charges by obtaining particulars, and testing the complainant's evidence by all available forensic methods. His capacity similarly to test the evidence of the uncharged acts may be limited. The adversarial process by which charges are laid, particularised, and contested may be ill-adapted to an investigation of these other allegations. This problem is not limited to a complainant's evidence of uncharged acts in sexual abuse cases. It may arise in other forms of similar fact evidence where the alleged facts are disputed. Questions of form, as well as content, need to be taken into account. 18 Makin v Attorney-General for New South Wales [1894] AC 57 at 65. The common law excludes evidence if its probative value is outweighed by its prejudicial effect. Examples of prejudicial effect are given above. The concept of probative value involves relevance and weight. The probative value of evidence must be considered by reference to the purpose or purposes for which it is used. In Pfennig v The Queen19, McHugh J pointed out that prejudicial effect and probative value are incommensurables. So, it might be said, are many other forms of competing considerations that judges routinely "weigh". A great deal of judicial and other decision-making involves forming a judgment about where the balance is to be struck between competing considerations that are not amenable to any fixed standard of comparison. To require a judgment as to what is just by taking into account probative value and prejudicial effect is the way in which the common law in England, Canada and New Zealand still deals with propensity evidence. The authorities before 1995 were discussed by this Court in Pfennig v The Queen20. In Pfennig, the High Court accepted the same general principle, but refined its application to similar fact evidence in an attempt to ensure that what is to be applied is a rule of law, not a discretion, and that the rule of law provides an adequate response to the danger of unfair prejudice. In Pfennig the issue was identity. The truth, as distinct from the admissibility, of the similar fact or propensity evidence was not in dispute. It was a murder case. The accused was charged with abducting and murdering a young boy. The evidence in question showed that he had admitted abducting and indecently interfering with another young boy on a separate, subsequent occasion. The evidence also established that the accused met the murder victim shortly before the victim disappeared. When the pattern of similarity, underlying unity or "signature" common to both incidents was taken into account, the later incident was cogent, circumstantial evidence pointing to the accused's guilt of murder of the first boy21. The propensity revealed by the second incident was used as circumstantial evidence in relation to the first incident. The plurality judgment, of Mason CJ, Deane and Dawson JJ, accepted that the underlying necessity was to make a judgment about probative value and prejudicial effect. They quoted what was said by Lord Cross of Chelsea in Boardman22: 19 (1995) 182 CLR 461 at 528; [1995] HCA 7. 20 (1995) 182 CLR 461 at 476-480. 21 (1995) 182 CLR 461 at 488-489. 22 [1975] AC 421 at 457. "The question must always be whether the similar fact evidence taken together with the other evidence would do no more than raise or strengthen a suspicion that the accused committed the offence with which he is charged or would point so strongly to his guilt that only an ultra- cautious jury, if they accepted it as true, would acquit in face of it." They also quoted Lord Mackay of Clashfern LC who said, in Director of Public Prosecutions v P23: "[T]he essential feature of evidence which is to be admitted is that its probative force in support of the allegation that an accused person committed a crime is sufficiently great to make it just to admit the evidence, notwithstanding that it is prejudicial to the accused in tending to show that he was guilty of another crime." However, accepting that underlying principle, the plurality judgment went on to formulate a more specific test, which had its origin in the use of circumstantial evidence to convict. It should be remembered that the case in Pfennig was entirely circumstantial, and the (undisputed) evidence of propensity formed part of the circumstances. It revealed a propensity to abduct young boys for sexual purposes, a propensity which, when added to the other circumstances, was held to be conclusive of guilt of murder. Without the circumstance of propensity, the other circumstances were inconclusive. As noted above, other evidence in the case showed that the accused met the victim at or about the time of his disappearance. The propensity evidence showed that the accused was a child molester. It was thought to be very unlikely that there were two child molesters in the particular area at the time, and that the other one also had met the victim. This, it may be noted, involves certain societal assumptions, not syllogistic reasoning. The refinement of the general principle advanced in the plurality judgment in Pfennig was encapsulated in the following passage24: "Because propensity evidence is a special class of circumstantial evidence, its probative force is to be gauged in the light of its character as such. But because it has a prejudicial capacity of a high order, the trial judge must apply the same test as a jury must apply in dealing with circumstantial evidence and ask whether there is a rational view of the evidence that is consistent with the innocence of the accused." 23 [1991] 2 AC 447 at 460. 24 (1995) 182 CLR 461 at 482-483 (reference omitted). Since they had earlier accepted Lord Cross of Chelsea's identification of the question as one concerning the value of the similar fact evidence taken together with the other evidence, their Honours must have been speaking of "the evidence" as the similar fact evidence taken together with the other evidence25. That, indeed, is the way their reasoning in relation to the case before them proceeded. If there were any uncertainty as to what their Honours meant, the surest guide to their meaning is to be found in the way they applied it to the facts. An earlier passage in the plurality judgment stated26: "In other words, for propensity or similar fact evidence to be admissible, the objective improbability of its having some innocent explanation is such that there is no reasonable view of it other than as supporting an inference that the accused is guilty of the offence charged." The reference to "its having some innocent explanation" was elliptical. The question was whether, when the propensity evidence was taken into account, there was no reasonable view of the totality of the evidence other than as supporting, with the degree of strength described in other passages, an inference that the accused was guilty of murder. McHugh J criticised the reasoning in the plurality judgment, saying that the test propounded was impossible to relate to many well-known cases, including similar fact evidence in sexual offences. He distinguished between cases where the use of the evidence was for a reason other than the accused's propensity and cases where the prosecution relied on propensity reasoning. Cases in the first category, he said, such as cases where evidence of relationship simply explains other evidence that directly implicates the accused, could not be subject to the "no rational explanation" test. The correctness of that observation seems to have been assumed in Gipp v The Queen27, as McHugh J pointed out in KRM v The Queen28. In any event, there is no logical answer to this point. Pfennig was not a case about evidence that happened to reveal propensity; it was a case about the use of the fact of propensity as circumstantial evidence in proof of the offence charged. The use of propensity as circumstantial evidence was the key to the formulation of the refined test. What was said in Pfennig must be understood in its context. 25 Phillips v The Queen (2006) 225 CLR 303; [2006] HCA 4. 26 (1995) 182 CLR 461 at 481-482 (reference omitted). 27 (1998) 194 CLR 106. 28 (2001) 206 CLR 221 at 228-233 [20]-[31]. There are commonplace examples of admissible evidence that reveals a criminal tendency, or discreditable behaviour, but that is not tested by reference to what might be described as the Pfennig refinement of the general principle concerning probative value and prejudicial effect. The most obvious example is evidence of bad character that is received to contradict evidence of good character. There are also examples of admissible evidence of motive which reveals criminal acts but has nothing to do with propensity reasoning. Suppose D is charged with the murder of X. Suppose the prosecution sets out to prove motive, the alleged motive being that X was blackmailing D because X had became aware that D had engaged in criminal or other discreditable conduct. Evidence that D, to the knowledge of X, had engaged in such conduct would be relevant, as supporting the alleged motive, but the propensity revealed by such conduct may be completely irrelevant. The Pfennig refinement upon the general principle as stated, for example, in Boardman does not supplant the general principle in all cases of evidence which reveals the commission of criminal offences other than the charged offences. Where evidence of uncharged acts is introduced for the common, and acceptable, purpose of explaining that a complainant, in giving an account of conduct the subject of a charge, is not purporting to describe an isolated event, so that the account of the event may properly be evaluated by the jury, the test to be applied in determining admissibility is whether the probative value of the evidence outweighs its prejudicial effect. Evidence may have probative value in the assistance it gives in assessing other evidence. What is sometimes called "relationship evidence" may have value in this way. So also may evidence of what are sometimes called res gestae. The evidence that was held to be admissible in O'Leary v The King29, of similar acts prior to and after the events charged, helped to explain or make intelligible the course of conduct pursued30. In a sexual abuse case, a complainant's evidence of uncharged acts, admitted only for the purpose of explaining or making intelligible her account of the charged acts, or to show that she was not purporting to describe an isolated event where otherwise her account may appear implausible, need not offend rules against investigation of collateral matters or impermissible attempts to bolster a witness's credit. It is, however, subject to the general principle concerning probative value and prejudicial effect, and the possible potential unfairness resulting from both form and content earlier discussed may affect its admissibility. 29 (1946) 73 CLR 566; [1946] HCA 44. 30 See also Martin v Osborne (1936) 55 CLR 367 at 375; [1936] HCA 23. Evidence of uncharged acts has another potential use as evidence of motive. The form of particular propensity involved in a sexual interest of a parent in a child could be regarded as providing a motive for conduct of the kind alleged in the charge. This form of propensity reasoning might not be relied on, in which case it may be necessary for a trial judge to warn a jury against employing it. Where, however, it is pursued, then the Pfennig reasoning, that is, reasoning about propensity as a circumstantial fact making more likely the offence charged, is in point. Pfennig was a case about the legitimate use of propensity reasoning, and the probative value, in such a context, of the evidence of propensity. It expressed a test for deciding whether the evidence of propensity reached a certain level or standard of probative value. The concept of probative value is about assessment of probabilities, which includes the reasonableness of inferences. In deciding admissibility, the trial judge assesses the probative value of the evidence in question upon the assumption that it is accepted31, and in the context of the other evidence. It is a test of admissibility of evidence, not a test of the reasonableness of a jury verdict. In the present matters, unlike Pfennig, there was direct testimony that the accused had engaged in the acts alleged in the charges. In each case, if the evidence of the complainant about the uncharged acts were accepted, when added to the other evidence, including the direct testimony, it would have eliminated any reasonable doubt that might be left by the other evidence. The observations of Hodgson JA in WRC32 are in point. The nature of the issues in each case was not such as to require a different conclusion. There may be cases in which the nature of the dispute about the complainant's testimony, considered as a whole, is such that acceptance of the evidence of the uncharged acts is inconclusive. These cases are not of that kind. In each case, the probative value of the evidence of uncharged acts would have satisfied the Pfennig standard. However, as will appear, the evidence was not left to the jury as evidence of motive, and warnings were given against propensity reasoning. In those circumstances, while the Pfennig refinement did not apply, it was still necessary to consider whether probative value was outweighed by prejudicial effect. One further observation should be made about prejudicial effect. The forms of prejudice earlier discussed are in some cases amenable to management by limiting the use to which evidence may be put, controlling the form in which it may be adduced, and giving suitable directions and warnings to juries. If a trial judge concludes that the risk of prejudice is such as to put it beyond reasonably effective management, then the evidence should be excluded. There may be 31 Phillips v The Queen (2006) 225 CLR 303. 32 (2002) 130 A Crim R 89 at 101-102 [26]-[29]. cases in which fairness is best served by confining the evidence of uncharged acts to brief and general evidence that the occasion the subject of an alleged offence was not an isolated instance. In Gipp v The Queen33, McHugh and Hayne JJ referred to the possibility of a defence preference for evidence of sexual history that was given shortly and without detail. The circumstances of particular cases will vary, and the appropriate judicial response to the requirements of fairness cannot be anticipated by a general rule save that, as already mentioned, both form and content will require consideration. Standard of proof It is the elements of the offence charged that, as a matter of law, must be proved beyond reasonable doubt. (I leave aside presently irrelevant cases where insanity or some other defence is raised.) If evidence of a fact relevant to a fact in issue is the only evidence of the fact in issue, or is an indispensable link in a chain of evidence necessary to prove guilt, then it will be necessary for a trial judge to direct a jury that the prosecution must establish the fact beyond reasonable doubt; generally, however, the law as to standard of proof applies to the elements of the offence, not particular facts. The decisions of this Court concerning corroboration in Doney v The Queen34, and proof of lies as evidence of consciousness of guilt in Edwards v The Queen35, illustrate the point. Trial judges commonly, and appropriately, direct juries in terms of their possible satisfaction of particular matters relied upon by the prosecution, without referring to a standard of proof in relation to each such matter. To do otherwise would risk error. Where evidence is adduced for the purpose of explaining a context or similarly assisting the evaluation of the evidence of a witness, no separate question of the standard of proof of such evidence arises. Thus, if a complainant, giving direct evidence of the facts which constitute the elements of the offence charged, says that it was not an isolated incident but part of a wider pattern of behaviour, and does so either generally or with specificity, no separate question of a standard of proof in relation to the latter evidence ordinarily would arise. There is no general principle that whenever, at a criminal trial, the prosecution sets out to prove, as a fact relevant to a fact in issue, that some criminal conduct occurred, that fact must be established beyond reasonable doubt. In the example earlier given, where certain behaviour by D is relied upon 33 (1998) 194 CLR 106 at 132 [75]. 34 (1990) 171 CLR 207 at 211; [1990] HCA 51. 35 (1993) 178 CLR 193 at 210; [1993] HCA 63. in support of an alleged motive on the part of D to murder X who was said to be blackmailing D, it would make no difference in principle whether the behaviour was criminal or whether it was otherwise discreditable. Unless it was indispensable in the sense earlier mentioned, it would not have to be proved beyond reasonable doubt. In the recent case of Washer v Western Australia36, evidence was admitted to show that an accused, who was charged in connection with a certain drug importation, was in the business of drug dealing. This was circumstantial evidence relevant to the alleged intent to supply the drugs involved in the importation. It was not an indispensable fact; it was part of a web of circumstances. It did not have to be established beyond reasonable doubt, or at all. Where a complainant's evidence of uncharged acts is relied upon by the prosecution as evidence of motive in order to support the complainant's evidence of the charged acts, two considerations may arise. First, if that evidence is an indispensable step in reasoning towards guilt then it may be necessary and appropriate to give a direction about the standard of proof in respect of such evidence. Secondly, it may be unrealistic, in cases such as the present, to contemplate that any reasonable jury would differentiate between the reliability of the complainant's evidence as to the uncharged acts and the complainant's evidence as to the charged acts. That will not always be so. There may be cases where some parts of a complainant's evidence are corroborated and others are not, or where an accused's response to part of the evidence is different from the response to other parts. Generally speaking, however, the indispensable link case apart, it is ordinarily neither necessary nor appropriate for a trial judge to give separate directions about the standard of proof of uncharged acts. The views expressed by Doyle CJ in R v Nieterink37, which were acted upon by the trial judges in these three matters, are consistent with what is said in the preceding paragraph. The present matters The facts and the issues in each matter are set out in the reasons of Hayne J and Heydon J. In HML v The Queen, the trial judge left the evidence of the uncharged acts to the jury, not as evidence of motive, but only as evidence of the context in which the complainant's evidence of the charged acts was to be evaluated. I have already referred to her evidence as to asking the accused for permission to go 36 (2007) 82 ALJR 33; 239 ALR 610. 37 (1999) 76 SASR 56. shopping and his response. The trial judge referred to the father's confidence to offend, and the complainant's lack of surprise or complaint. The judge gave warnings against the use of propensity reasoning. The evidence of the uncharged acts was admissible, and the directions were adequate. I agree, for the reasons given by Hayne J, that the action or inaction of the Victorian authorities in relation to the uncharged acts in Victoria was irrelevant38. In SB v The Queen, the evidence in question was not the subject of objection at trial. Leave to amend the notice of appeal to raise the question of admissibility should be refused in accordance with the principles referred to in Crampton v The Queen39. The trial judge told the jury that the evidence was potentially helpful in evaluating the complainant's evidence of the charged acts which "may otherwise appear to be unreal or not fully comprehensible." He directed the jury not to use propensity reasoning. The evidence was not received or used as evidence of motive. The directions involved no error or unfairness. In OAE v The Queen, the prosecution, as sometimes happens, charged the accused with the first and the last of a series of happenings. Presumably this is done because a complainant may have a clearer recollection of the first and the last such acts, unless there is something particularly memorable about the intervening occasions. Here again, the trial judge did not admit the evidence as evidence of motive, and warned the jury against propensity reasoning. The directions to the jury referred to the permissible use of the evidence only as establishing a context for the evidence of charged acts. The evidence was admissible, and the jury directions were sufficient. In particular, for the reasons given earlier, there was no occasion to tell the jury that they could not rely on the evidence in question unless they found it established beyond reasonable doubt. Conclusion In each of HML v The Queen and SB v The Queen the appeal should be dismissed. In OAE v The Queen, special leave to appeal should be granted but the appeal should be dismissed. 38 cf Washer v Western Australia (2007) 82 ALJR 33; 239 ALR 610. 39 (2000) 206 CLR 161; [2000] HCA 60. GUMMOW J. The appeals by HML and by SB were heard together and with the special leave application by OAE. Special leave should be granted and the appeal by OAE treated as having been heard instanter. All these appeals are brought from the South Australian Full Court sitting as the Court of Criminal Appeal. The issues of the law of evidence which have been argued in this Court turn upon the common law, with one qualification. This is the belated attempt, which should not succeed, made in oral argument on the appeal by HML to rely upon s 34I of the Evidence Act 1929 (SA). I agree with what is written by Hayne J respecting matters of general principle. In particular, I agree with what appears in his Honour's reasons under the heading "Pfennig v The Queen". I agree with the reasons given by Hayne J for the disposition of the appeals by SB and by OAE. With respect to the appeal by HML, my agreement has the reservation respecting the treatment of the laying of charges in Victoria which is developed by Kirby J in his reasons. I agree with what Kirby J has written on that aspect of the appeal by HML, including the application of the proviso. The upshot is that in this, as in the other appeals, I agree with the orders Kirby KIRBY J. Three proceedings are before this Court. Two are appeals, by special leave already granted, from orders of the Court of Criminal Appeal of South Australia40. The other is an application for special leave to appeal from orders of the same court41. The application was directed to be heard with the appeals because of the similarity of some of the issues raised42. I agree that special leave should be granted in the third matter. The appeals have been considered together because of uncertainties that have arisen in trial and intermediate courts in respect of evidence in criminal trials involving accusations of sexual offences committed against under-aged children, commonly by family members. In particular, the appeals present controversies relating to: The rulings to be made in such trials in respect of the relevance and admissibility of evidence of discreditable sexual conduct involving the accused, apart from that alleged in the specific charges brought by the prosecution; and The directions or warnings that should be given to a jury by a trial judge in such a trial, where such evidence is ruled admissible. Such directions or warnings might relate to: (a) the potential uses of such evidence; (b) the standard of proof to be applied by the jury in deciding whether or not they accept such evidence and whether they should use it in reasoning to their conclusion about the guilt of the accused of the offence(s) charged; and (c) the dangers of propensity reasoning based upon such evidence. So much has been written about the foregoing questions in earlier decisions of this Court43, and now in these proceedings, that I hesitate to add to the elaboration lest what I write ends up contributing to the uncertainties. Rulings on evidence of this type must often be made by trial judges on the run, in the course of the criminal trial. Of its nature, such a trial will often be fraught and emotional. In addition, trial judges face great burdens in framing their directions and warnings to juries in cases of the present kind. Such directions or warnings must be framed so as to be understood by a jury of ordinary Australian 40 In R v H, ML [2006] SASC 240 and R v S, B [2006] SASC 319. 41 See R v O, AE (2007) 172 A Crim R 100. 42 OAE v The Queen [2007] HCATrans 473. 43 See in particular Gipp v The Queen (1998) 194 CLR 106; [1998] HCA 21; KRM v The Queen (2001) 206 CLR 221; [2001] HCA 11; Tully v The Queen (2006) 230 CLR 234; [2006] HCA 56. Kirby citizens who do not have the luxury of hours (still less months) of cogitation. Therefore, this is a case where, if at all possible, this Court should make a particular effort to speak with a clear voice. In so far as there are differences between the opinions expressed in the reasons of Gleeson CJ, Hayne J, Heydon J, Crennan J and Kiefel J, I prefer and endorse (as Gummow J does) the principles stated by Hayne J. I do so because I agree with Hayne J, for reasons that I will detail, about: the purposes for which, in trials of this character, evidence of "uncharged the applicability to the admissibility of such evidence45 of the holding of this Court in Pfennig v The Queen46; and the necessity, where such evidence is admitted, for the trial judge to instruct the jury that they must be satisfied beyond reasonable doubt about the truth of such evidence if they are to use it to reason towards guilt47. In particular, I agree in what I take to be Hayne J's insistence upon conformity with what was said by this Court in Pfennig (observed, for example, in the approach of the Court of Appeal of Victoria in R v Vonarx48) in preference (where it is different) to the approach adopted by the Court of Criminal Appeal of South Australia in R v Nieterink49. It was the reasoning in Nieterink that influenced the Court of Criminal Appeal of South Australia in deciding, in the ways that it did, the three appeals that are now before this Court. 44 Reasons of Hayne J at [103]-[111]; cf reasons of Gleeson CJ at [5]-[11]; reasons of Heydon J at [274]-[336], [364], [387], [390]-[394]; reasons of Crennan J at [423]- [433]; reasons of Kiefel J at [491]-[501]. 45 Reasons of Hayne J at [106], [112]-[118]; cf reasons of Gleeson CJ at [24]-[27]; reasons of Heydon J at [289], [364], [387]; reasons of Crennan J at [455]-[467]; reasons of Kiefel J at [502]-[511]. 46 (1995) 182 CLR 461. 47 Reasons of Hayne J at [132], [244]; cf reasons of Gleeson CJ at [29]-[32]; reasons of Heydon J at [339], [376], [395]; reasons of Crennan J at [477]; reasons of 49 (1999) 76 SASR 56 at 66 [48]-[49]. Kirby With one exception, I also agree with Hayne J about the proper application of the relevant principles to the present appeals. The exception relates to the exclusion, on grounds of relevance, of evidence that the appellant HML sought to tender concerning the then current state of criminal proceedings against him in Victoria. However, this error does not affect the outcome of that appeal. The "proviso"50 is applicable. HML's appeal should be dismissed. I will also offer some additional comments about the serious inadequacies in the directions given to the jury in the appeal of OAE, both as to the use that the jury in that case might make of "uncharged acts" as part of the "context" and as to the want, there, of a sufficiently clear indication that evidence of the uncharged acts had to be proved beyond reasonable doubt. I agree with Hayne J that the defect is not one to which the "proviso" applies. Alike with his Honour, I would allow OAE's appeal. In relation to the appeal of SB, I have nothing to add to what Hayne J has written. I agree with the reasons and conclusions of Hayne J (including on the application for leave to enlarge the grounds of appeal). It follows that that appeal should be dismissed. These reasons will therefore explain why: I agree with Hayne J as to the applicable general principles; I differ, in one respect, from Hayne J as to their application in the appeal of HML, but without dispositive consequences; and I agree with Hayne J as to the disposition of the appeal of OAE. The analysis in these reasons adopts the assumption, inherent in much appellate examination of jury decision-making, that members of a jury reach their conclusions by a process of deliberation from evidence to verdict by way of an accurate application of judicial directions on the law51. Such empirical evidence as there is casts serious doubts upon such assumptions52. Indeed, psychological 50 Criminal Law Consolidation Act 1935 (SA), s 353(1); cf Liberato v The Queen (1985) 159 CLR 507 at 518; [1985] HCA 66; Gillard v The Queen (2003) 219 CLR 1 at 15 [29], 32-33 [94]-[97], 41-42 [133]-[134]; [2003] HCA 64. 51 cf reasons of Heydon J at [353], reasons of Kiefel J at [488]. 52 See Zoneff v The Queen (2000) 200 CLR 234 at 260-261 [65]-[67]; [2000] HCA 28. See also Cush and Goodman-Delahunty, "The Influence of Limiting Instructions on Processing and Judgments of Emotionally Evocative Evidence", (2006) 13 Psychiatry, Psychology and Law 110 at 113. Kirby research applied to judicial or other decision-making, including investigations based on the cognitive reflection test, suggests the very large role played by intuition in such decisions. In such matters, the human brain has a tendency to make automatic, snap judgments53. However, in default of contrary argument, these reasons will continue to make the law's assumptions, however dubious they may be in scientific terms. The facts and legislation The facts: The facts of each appeal are set out in considerable detail in other reasons. Those reasons disclose the relevant objections to, and rulings on, the evidence at trial, the grounds of appeal and dispositions in the Court of Criminal Appeal in each case, and the arguments advanced in this Court. It will be necessary for me to add a little more detail concerning the error in the trial of HML just mentioned. However, otherwise, I am content to rely on the detailed expositions by my colleagues. The legislation: As Heydon J explains in a note to his reasons, this Court's expression of the law in these appeals is substantially confined to those jurisdictions of Australia in which the common law rule stated in Pfennig survives54. Other than in South Australia, the Northern Territory, and to some extent Queensland, the rule in Pfennig has been amended, either by the adoption of the Uniform Evidence Acts55 or by the enactment of particular State legislation56. Subject to any constitutionally protected principles of due process, it is competent for the Parliaments of Australia to regulate the substantive and evidentiary law that is in issue in these proceedings. No constitutional argument has been raised by any party. In several jurisdictions, including South Australia, an attempt has been made to address the issues arising in these proceedings by the creation of so- 53 Guthrie, Rachlinski and Wistrich, "Blinking on the Bench: How Judges Decide Cases", (2007) 93 Cornell Law Review 1 at 19. 54 Reasons of Heydon J at [288], fn 227. 55 See ss 97 and 98 of the Uniform Acts. These Acts are applicable in federal courts and in the Australian Capital Territory, New South Wales, Tasmania and Norfolk Island. See reasons of Heydon J at [288], fn 227. 56 Evidence Act 1977 (Q), s 132A; Crimes Act 1958 (Vic), s 398A; Evidence Act 1906 (WA), s 31A. See Washer v Western Australia (2007) 82 ALJR 33 at 46 [58]; 239 ALR 610 at 625-626; [2007] HCA 48. Kirby called "relationship crimes"57 and by the enactment of special evidentiary rules for cases involving sexual offences58. As explained in other reasons, none of these special legislative provisions is determinative of the present appeals. Admissibility of relationship evidence Factors favouring admission: I accept that, as a matter of legal principle or policy, several considerations tend to support the reception of evidence by complainants of alleged acts of sexual abuse different from, and additional to, those identified in the charges preferred against the accused by the prosecution: (1) Although criminal trials address specific charges alleged in an information or indictment, the experience of the courts shows that sexual abuse of young persons is often, or typically, manifested in multiple and repeated incidents over a period of time. It is commonly impracticable, or even impossible, to include them all among the formal charges. The repeated character of the events may render them individually unmemorable either to the complainant or to the accused. A court process directed to eliciting a truthful description of what has happened to a complainant will take account of such practical considerations; (2) Where sexual assault cases are not prosecuted under the new provisions establishing "relationship crimes", a practice is often observed by prosecutors of charging the first, or earliest, alleged incident of a sexual offence remembered by the complainant and also the most recent incident that can be described59. Others may be included because of special features in the facts or surrounding circumstances which are said to trigger the memory of the complainant and to permit particularity. However, almost inevitably, and whatever the wishes and precautions of lawyers, evidence may emerge of other incidents not made the subject of charges. This may be due to factual links between such incidents and the matters charged60, or because such incidents are allegedly remembered whilst the complainant's evidence is being adduced. Alternatively, the complainant, 57 See eg Criminal Law Consolidation Act 1935 (SA), s 74. See reasons of Heydon J at [259]. A similar provision was considered in KBT v The Queen (1997) 191 CLR 417; [1997] HCA 54. 58 See eg Evidence Act 1929 (SA), s 34I. See reasons of Hayne J at [185]-[187]; reasons of Heydon J at [337]. See also s 34CA of that Act; cf reasons of Heydon J 59 Reasons of Gleeson CJ at [37]. 60 As was the case in the trial of HML; see reasons of Heydon J at [318]. Kirby unaware of (or impatient with) the conventions of the criminal trial, may assert that many other similar instances occurred, leaving it to the trial judge to deal with the admissibility of such evidence and with the directions that should then be given. Attempts to quarantine the charged acts may, in practice, be both artificial and futile; From the point of view of the complainant, and respecting his or her entitlement to provide a truthful version of what is recalled, it is important for legal procedure to facilitate, so far as basic principle permits, the giving of a "fair and coherent account"61 of what has allegedly occurred resulting in the criminal prosecution62; The law has an important obligation to protect truthful complainants about sexual abuse. It is an appreciation of the significance of this consideration that led Lord Hope of Craighead to observe in R v A (No 2)63 that "the balance between the rights of the defendant and those of the complainant is in need of adjustment if [complainants] are to be given the protection under the law to which they are entitled against conduct which the law says is criminal conduct". This observation has particular force where the abuse has allegedly been suffered by children as a result of the conduct of family members who owe the child special duties of trust and protection; Self-evidently, sexual assault against children is a very serious crime both in terms of its incidence in our society and in its impact on the victim, the victim's family and the community. There is compelling evidence of historical "under-enforcement" in this area64. The increase in prosecutions for offences of the present kind observed by the courts in recent years is, in part, a reflection of changing community, police and prosecutorial attitudes. These developments ought not to be permitted to be frustrated by unjustifiably restrictive court procedures; and 61 White v The Queen [1999] 1 AC 210 at 217 cited reasons of Heydon J at [299]. 62 cf reasons of Crennan J at [474]-[475]. 63 [2002] 1 AC 45 at 71 [55]. See also DS v Her Majesty's Advocate [2007] UKPC D1 at [5]. 64 See Hamer, "Similar Fact Reasoning in Phillips: Artificial, Disjointed and Pernicious", (2007) 30 University of New South Wales Law Journal 609 at 634- 635. Hamer cites Australian Bureau of Statistics figures published in 2005 suggesting that 80% of women victims of sexual assault do not report the assault, and remarks that "[d]ata is unavailable, but under-reporting is likely to be higher still for sexual offences against children". Kirby The retention of jury trial for most contested allegations of such offences in Australia suggests a continuing acceptance of the need to entrust decision-making in such cases to "the ordinary experiences of ordinary people"65. Juries resolve disputed issues and distinguish false or unproved accusations from those which they consider to have been proved to the requisite standard by applying their collective experience of life and of their fellow human beings66. In recent years, the House of Lords, in Director of Public Prosecutions v P67 and R v H68, has demonstrated a greater willingness to trust juries with sensitive evidence than, for example, was apparent in the earlier case of R v Boardman69. Thus, Lord Griffiths, in the case of H70, suggested that a "less restrictive form" of the rules excluding relevant evidence was appropriate given today's "better educated and more literate juries". So far as the common law of Australia is concerned, the result may also be a greater willingness in this country to permit jury access to relevant but sensitive, and potentially prejudicial, evidence71. The fact that potential prejudice may be susceptible of limitation through careful directions and warnings is an additional factor that tends to favour reposing greater trust in juries in cases such as the present. Factors favouring exclusion: As against the foregoing considerations, a number of others need to be kept in mind: In general, criminal trials of serious offences in Australia observe an accusatorial form72. As a matter of law, the accused is ordinarily entitled to put the prosecution to proof of its allegations. In the usual case, it is essential that an accused person should be informed in advance of the trial not just of the "legal nature of the offence with which he is charged but 65 Doney v The Queen (1990) 171 CLR 207 at 214; [1990] HCA 51. 66 cf R v Best [1998] 4 VR 603 at 611 per Callaway JA. 69 [1975] AC 421. See reasons of Crennan J at [443]. 70 [1995] 2 AC 596 at 613. 71 cf reasons of Crennan J at [473]. 72 See RPS v The Queen (2000) 199 CLR 620 at 632-633 [27]-[29], 653-654 [101]; [2000] HCA 3. See also Thompson (2002) 130 A Crim R 24. Kirby also of the particular act, manner or thing alleged as the foundation of the charge"73. In Australia, this has led to rules of law and practice requiring a high degree of specificity of accusations and of criminal charges74. To the extent that uncharged accusations or generalised "relationship evidence" intrude upon such a trial, they have a tendency to impair the right of the accused to know in advance, and to prepare to test and to meet, the particular charges alleged. This, in turn, has the tendency to endanger a fundamental feature of the criminal trial; From the viewpoint of the accused, the foregoing elements of the criminal trial afford important protections. They permit the accused to prepare for the trial; to test the accusations; to assemble a defence; and (if so decided) to gather rebutting, alibi and other evidence. They also permit the accused to object to evidence as it is tendered where it is not relevant to the issues for trial, as those issues are defined by the information or the indictment, supplemented perhaps by particulars. To the extent that a complainant introduces other accusations and allegations that are not contained in the charges or particulars, serious prejudice may sometimes arise which it is difficult, or impossible, to cure on the run in the course of the trial; (3) Although the foregoing features of the accusatorial trial are particularly important in common law countries, it is arguable that a clear delimitation of criminal accusations before the beginning of any trial is a universal requirement of international human rights law. Thus, Art 14 of the International Covenant on Civil and Political Rights states a number of basic rights by reference to the "determination of any criminal charge" against a person. The determination of a "criminal charge" apparently postulates a degree of particularity and notice to the person accused of the exact allegation that is made; (4) Whilst proper attention must be addressed the protection of complainants, so that they may place relevant testimony before the trial without artificial or irrational impediments, it is the accused, and not the complainant, who is on trial. Ordinarily, in cases involving allegations of repeated child sexual assault, the accused faces, if convicted, serious (commonly custodial) punishment. It is therefore the duty of courts, and of prosecutors, to ensure the fairness of the trial, especially so because accusations of criminal offences against children are specially likely to 73 Johnson v Miller (1937) 59 CLR 467 at 489 per Dixon J; [1937] HCA 77. 74 Walsh v Tattersall (1996) 188 CLR 77; [1996] HCA 26. See KBT (1997) 191 CLR Kirby arouse feelings of prejudice and revulsion in the community which will normally be shared by jurors75; (5) Uncontested evidence sometimes later proves that accusations earlier made to police about a sexual assault are false, resulting in the initial conviction of an innocent person76. Cases also arise where such accusations are withdrawn and disclaimed after the accused has been convicted77. It is not correct to assume that all such accusations are accurate and reliable; and (6) Although criminal appeals are necessarily conducted on the assumption that the jury understand and observe directions given to them about the law78, there are risks, once certain evidence becomes known to the jury, that they may treat that evidence as disclosing a general disposition on the part of the accused to act as alleged in the charges. To the extent that the common law retreats from rules withholding particular evidence from the jury, and to the extent that the law permits the jury to receive and consider such evidence although not the subject of any charge, there may be a commensurate need to enlarge the judicial obligation to direct and warn the jury about the dangers of pure propensity reasoning. Conclusion on admissibility: When all of the foregoing considerations of legal principle and policy are given their due weight, I am prepared to retreat from opinions that I earlier expressed in KBT v The Queen79, Gipp v The Queen80 and other cases as to the admissibility of propensity evidence, including "relationship evidence" and evidence of "uncharged acts". I defer to what Hayne J has written on these subjects81. I do so because only Hayne J's approach in these appeals gives appropriate significance, in my view, to all of the considerations of principle and policy mentioned above. Thus, 75 cf De Jesus v The Queen (1986) 61 ALJR 1 at 3; 68 ALR 1 at 4-5; [1986] HCA 65. 76 See R v Button [2001] QCA 133; Edwards, "Ten things about DNA contamination that lawyers should know", (2005) 29 Criminal Law Journal 71 at 73. 77 See eg W (1989) 44 A Crim R 363. 78 Gilbert v The Queen (2000) 201 CLR 414 at 420 [13]; [2000] HCA 15. 79 (1997) 191 CLR 417. 80 (1998) 194 CLR 106. 81 Reasons of Hayne J at [102]-[133]. Kirby I agree that, in cases such as the present where sexual offences have been charged, "relationship evidence", including evidence about "uncharged acts", may be received as relevant to the charges against the accused provided such evidence meets the requirements of the test stated by this Court in Pfennig82. Where that evidence relates to other offences, different from those that are the subject of the charges concerning the same accused and complainant, the Pfennig test will ordinarily apply to such a case. The wider foundations propounded for the admission of such evidence (such as to bolster the credibility of the complainant, or to provide evidence of the general "context") would not ordinarily meet the Pfennig standard. In my view, such evidence is not admissible simply to provide "background". If such a vague criterion were adopted, virtually any evidence of discreditable conduct, uncharged in the information or indictment, would arguably be relevant and admissible in such a trial, because every alleged crime has a "context". Such a rule would be destructive of the particularity of the accusatorial trial. It would potentially be most unfair to the accused. It would undermine the proper discipline required of prosecutors in framing accusations. It would be damaging to the jury's central function, namely to return verdicts on the specific charges presented rather than to condemn the accused as a "nasty" or "disreputable" person. Once the linchpin for admissibility of such evidence is accepted as being that stated in the test expressed in Pfennig, the foundation for the reception of "relationship evidence" and evidence of "uncharged acts" becomes clearer. Such evidence may only be admitted if relevant to a permitted step in reasoning towards the accused's guilt of the charges framed in the information or indictment. Once this is clear, the requirement for directions or warnings to the jury to apply the criminal standard of proof becomes plain. That course is justified whether one invokes a metaphor and classifies the "relationship evidence" or evidence of "uncharged acts" as "links in a chain" of reasoning to guilt of the charges brought83, or whether one views such evidence as "so intertwined with the charged acts" as to necessitate satisfaction to that standard84. In any such case, "the trial judge must direct the jury that they must be satisfied that the uncharged acts have been proved beyond reasonable doubt"85. 82 (1995) 182 CLR 461. 83 cf Shepherd v The Queen (1990) 170 CLR 573 at 579; [1990] HCA 56. 84 O, AE (2007) 172 A Crim R 100 at 108 [38]. 85 O, AE (2007) 172 A Crim R 100 at 108 [38]. Kirby Standing back from the mass of decisional authority mentioned in other reasons, much of it difficult to reconcile, the approach endorsed by Hayne J achieves, in my view, an appropriate adjustment of the competing considerations of legal principle and policy that I have identified. It departs, to some extent, from the strict particularity favoured by the accusatorial tradition. However, it acknowledges the need, where relevant, for a clear direction as to the standard of proof to be applied to uncharged acts in cases of this kind. As well, there will often be a need for a clear warning from the judge about the dangers of pure propensity reasoning, that is, reasoning from a conclusion that the accused is a bad type of person to the conclusion that he or she is guilty of the particular offences charged. In approaching the issues raised by these three appeals in jurisdictions where the common law applies unaffected by statutory modification, Australian judges should apply the principles expressed in the reasons of Hayne J. Specifically, for the reasons Hayne J has given, a trial judge should instruct a jury "that they must only find that the accused has a sexual interest in the complainant if it is proved beyond reasonable doubt"86. Application of principles in HML v The Queen: a question of relevance A particular but relevant issue: Questions of relevance can sometimes arise in cases involving accusations against the same accused of multiple sexual offences. An instance is Phillips v The Queen87. There, this Court said88: "It is essential at the outset to identify the issues at the trial on which the similar fact evidence is tendered, for this is central to the identification of relevance, and to the assessment of probative force on which the admissibility of similar fact evidence depends." The decision in Phillips, and the way in which the issue of relevance arose in that case, have been criticised89. It is neither necessary nor appropriate in these appeals to address the criticism. The circumstances in which the issues of relevance arose here were quite different. They were argued at trial in the case of HML. They were pressed on appeal, including in this Court. The particular point in issue is a small and discrete one. Because it is one upon which I depart 86 See reasons of Hayne J at [247]. 87 (2006) 225 CLR 303; [2006] HCA 4. 88 (2006) 225 CLR 303 at 311 [26] (footnote omitted). 89 Hamer, "Similar Fact Reasoning in Phillips: Artificial, Disjointed and Pernicious", (2007) 30 University of New South Wales Law Journal 609. Kirby from the conclusion of Hayne J, I will explain how it arises; why I disagree; and why the consequence is not ultimately determinative of the disposition. A point reserved at trial: The prosecution case against HML was that, whilst the two charges contained in the information concerned sexual offences against his natural daughter that occurred in Adelaide in September/October 1999, other and different sexual misconduct had begun years earlier (and continued afterwards) during visits made by the complainant to her father, then living in Victoria90. The prosecutor expressly opened to the jury with the fact that HML had been interviewed by Victoria Police "in relation to the allegations of what had been taking place in Victoria". The jury were told that they would "have an opportunity to see that interview played on a video player later in the trial". So indeed the jury did. On the prosecution case, the reference to the Victorian events was justified on the basis that they showed that the alleged offences in Adelaide: "didn't just happen out of the blue; there had already been inappropriate behaviour toward her and indeed sexual offending continued afterward. Without knowing that, it might seem odd that the accused would suddenly commit the offences in a hotel in Adelaide. It puts the Adelaide offending into context. … [I]t demonstrates that the accused was someone who actually had a sexual interest in [the complainant]; he was sexually attracted to her. The evidence of the ongoing sexual conduct might explain the reasons for this offending. He offended against her because he found her sexually gratifying and that sexual interest in her continued over a number of years." Quite detailed evidence was then given in HML's trial, including by the complainant, about the sexual offences that allegedly occurred in Victoria. Those offences were said to have happened both before and after the charged (Adelaide) events. The only offences that were the subject of the trial in South Australia were those alleged to have happened in Adelaide. On an initial voir dire, counsel for HML had indicated that he wished to question Detective G J Beanland of Victoria Police, to be called in the prosecution case, as to "whether or not charges [had] been laid in Victoria". The prosecutor opposed this course on the basis that the answer would not be relevant to a fact in issue. In his submissions to the trial judge, counsel for HML explained: 90 See reasons of Hayne J at [136]; reasons of Heydon J at [251]. Kirby "I would not be asking him as to why the charges didn't proceed. But if, as the prosecution's issues [suggest], the jury are going to be hearing about uncharged acts, then it should be very plain that that's exactly what they are, otherwise it would be unfair to the accused." In response, the prosecutor submitted that the admission of such evidence would encourage speculation, and open "a can of worms". The trial judge indicated that he was inclined to agree with the prosecutor, stating that "[t]here shouldn't be any questions to elicit the fact that nothing occurred in Victoria". However, the trial judge expressly left it open to counsel for HML to make further submissions on the issue. Thus it was that counsel for HML renewed his application to adduce the contested evidence when Detective Beanland was called to give evidence. However, following short argument, the trial judge refused the application. He stated what was, in effect, his conclusion on this point as follows: "The fact that [HML] wasn't charged in Victoria is not probative of the fact that he was charged here or probative as to what the outcome of this proceeding might be. That's propensity reasoning at its worst. … I will be telling the jury that they are not to speculate and … I am entitled to assume that they will do as I tell them". Thus, although Detective Beanland was permitted to give evidence that he had questioned HML in August 2003 at the Mount Gambier Police Station in South Australia, he was not allowed to tell the jury that, to the date of the trial in March 2006, no charges based on the alleged Victorian offending had been laid by police. Suggested irrelevance of evidence: Other members of this Court have concluded that the trial judge's ruling was correct and that the evidence that trial counsel sought to adduce was rightly excluded as irrelevant91. An identical conclusion was reached by the Court of Criminal Appeal92. With all respect to those of that view, I disagree. Reasons for relevance: Evidence is relevant to an issue if the acceptance of it could bear on the demonstration of a matter in contention at the trial. It is not uncommon for courts to disagree over questions of relevance93. Judges must 91 Reasons of Gleeson CJ at [35]; reasons of Hayne J at [190]; reasons of Heydon J at [353]; reasons of Crennan J at [478]; reasons of Kiefel J at [515]. 92 H, ML [2006] SASC 240 at [12]-[13]. See reasons of Heydon J at [351]. 93 As this Court did in Smith v The Queen (2001) 206 CLR 650 at 656 [12]; cf at 657- 659 [19]-[24]; [2001] HCA 50. Kirby commonly reach and express their conclusions on contested questions of relevance quickly and intuitively. On this issue I certainly acknowledge the respect that is owed to the opinion of the trial judge, affirmed on appeal. However, for several reasons, I regard that conclusion as erroneous: Statements in the trial of HML about the Victorian allegations (and the serious criminal offences that those allegations suggested) were made in the prosecutor's opening to the jury. Evidence about those allegations was given in the complainant's testimony. The issue was revived in the prosecutor's closing address and in the judge's summing up. The allegations therefore constituted an important and repeated theme in the trial. They were deliberately introduced into the trial by the prosecution, allegedly to provide "context". Yet although (as this Court holds) evidence of them was receivable for that purpose, the ruling of the trial judge denied HML the opportunity that he sought to attempt to neutralise the Victorian allegations as best he could; The Victorian allegations related to alleged incidents both before and after the Adelaide visit. According to the complainant, HML, in Victoria, would place one or two fingers in her vagina in the morning, doing so "regularly", and would also kiss her goodnight, trying to insert his tongue into her mouth in an inappropriate and suggestive fashion. Allegedly, on at least one occasion after the Adelaide visit, HML penetrated his daughter's vagina with his penis and, separately, performed an act of cunnilingus upon her94. Having regard to the time when these offences were alleged to have occurred in Victoria, the report about them to Victoria Police, the investigation of the complaints by those Police, the interview of HML by Detective Beanland at Mount Gambier (conducted in conjunction with South Australian Police), and the subsequent lapse of time, a jury would arguably have been entitled to assume that (in the ordinary course of events) a decision would have been made, one way or the other, on whether or not to prosecute the offences, or at least the most significant of them. From silence, the jury might conclude that HML had been charged, and perhaps was awaiting trial or had even been convicted upon them; The relevance of the alleged Victorian offences was clearly regarded as established. But if they were relevant, it was strongly arguable that the failure in the available time to prosecute such offences was also relevant. Fairness suggests that HML should have been afforded the chance to attempt (so far as he could) to deal with such potentially prejudicial, and effectively unanswerable, evidence and statements. The only means 94 Reasons of Heydon J at [256]. Kirby available to him to do so rested on the fact (undisputed in the absence of the jury) that no charges had been brought in Victoria. There was a distinct element of inequality in permitting the Victorian evidence to be led by the prosecution but precluding HML from establishing the current status of the accusations; The trial judge's direction to the jury that they should not "speculate" about the outcome of the Victorian allegations (which he incorrectly described in his charge as "offences") did not, in my view, neutralise the Victorian evidence. On the contrary, such a direction was almost bound to attract the jury's curiosity about the outcome, in consequence of the specific mention of it. Whilst it is true that a decision on the prosecution of HML in respect of the Victorian allegations depended on decisions by officials absent from the trial in South Australia, it would not have been difficult to frame a factual explanation to the jury to the effect that no Victorian charges had been brought; but that this did not prevent them being brought in the future; and that the jury should focus their attention strictly on the alleged Adelaide offences which were the only charges upon which the jury's verdicts were to be returned. When the "uncharged" Victorian acts were given such attention in the trial, they were clearly treated as relevant to the issues in some way. Basic fairness should then have led to acceptance of HML's submission and to permission to procure evidence on the issue from Detective Beanland. It is difficult to deny that HML's attempted response was relevant without accepting that the entire evidence of the Victorian allegations was irrelevant and should have been excluded on that basis. The one was an attempted qualification, albeit partial, of the other. Rejection of HML's application was, in my view, erroneous. The resulting error was only compounded by the direction that the judge then gave. Application of proviso: It follows that I differ in my conclusion on this issue. The exclusion of the evidence which HML sought to tender on this issue amounted to a "miscarriage of justice". Prima facie it enlivens a right to have the jury's verdicts quashed and a retrial ordered. Nevertheless, under the "proviso" in South Australia it is necessary for a court, reaching such a conclusion, to proceed to consider for itself whether "no substantial miscarriage of justice" has "actually occurred". This familiar language95 requires this Court either to express its own conclusion on the point or to remit the question to the Court of Criminal Appeal for its decision on the 95 See Liberato (1985) 159 CLR 507 at 520 citing Mraz v The Queen (1955) 93 CLR 493 at 514; [1955] HCA 59; Weiss v The Queen (2005) 224 CLR 300; [2005] HCA Kirby issue96. Given the extensive consideration of the evidence by this Court, I consider that the decision on the application of the proviso can and should be made immediately. The submissions of HML at trial on this point could not have resulted in the complete exclusion of the evidence of the Victorian allegations from consideration by the jury. For the reasons already given, the jury properly had access to that evidence, being evidence of other offences admissible on the Pfennig test to demonstrate HML's sexual interest in the complainant. All that HML therefore lost by the incorrect ruling on the question his counsel propounded was the chance to present to the jury a factual integer indicating that no prosecutions had "yet" been brought in respect of any Victorian allegations. Had such evidence been adduced from Detective Beanland, it would have been necessary for the trial judge to qualify it by explaining to the jury that no one (including Detective Beanland) knew if, or whether, any such prosecution would, or would not, be brought by the Victorian prosecution authorities, not themselves members of the police force. The most that would have been added was a factual ingredient that would have made the instruction to the jury not to "speculate" appear more rational and understandable. Given the nature of the matters in issue in HML's trial, the absence of that integer is not a cause of a substantial miscarriage. Nor am I convinced that, in consequence of the omission, an actual miscarriage of justice has occurred. This issue could, and should, have been handled better. But in the context of the ultimate focus of the trial on the Adelaide offences, it is not necessary, on this ground, to set aside the convictions based on the jury's verdicts. Those convictions should stand. Application of principles in OAE v The Queen: direction on standard of proof Standard of proof: general principles: In his reasons, Hayne J concludes (as I also would) that whether or not evidence of "uncharged" acts is admissible is not to be determined97: "by asking whether the evidence in question will put evidence about the charges being tried 'in context', or by asking whether it describes or proves the 'relationship' between complainant and accused". 96 cf Mahmood v Western Australia (2008) 82 ALJR 372 at 379 [31]; 241 ALR 606 at 614; [2008] HCA 1. 97 Reasons of Hayne J at [106]. Kirby The mistake involved in this approach is that, if it were endorsed, it would effectively allow any relevant discreditable facts to be tendered against an accused simply because such evidence threw some light on the "context" of the offences. The risks of unfairness inherent in such an approach are obvious. The purpose of adopting the more stringent approach set out in Pfennig is to obviate, or at least minimise, such risks in cases of the present kind. It is because the Pfennig approach is correct that, in relation to any "uncharged" acts (at least in cases of sexual offending), the jury must be charged that they have to be satisfied beyond reasonable doubt that the prosecution has proved the "intermediate facts" propounded as constituting an indispensable step on the way to an inference of guilt of the offences charged98. Other members of this Court have concluded that the directions given to the jury in the trial of OAE were adequate and conformed to law. However, they come to their conclusions by different ways. Thus, Gleeson CJ would hold that, because the relevant evidence was provided for the explicit purpose of explaining "context", and not as comprising an "indispensable link" in proof of the elements of an offence charged, no separate treatment of the standard of proof was warranted99. Heydon J considers that it is unnecessary to decide whether the criminal standard of proof has a wider application in cases such as the present, because whatever the case, the judges' summing up in each of the three appeals included a direction incorporating the criminal standard100. This is so, notwithstanding that the ostensible purpose of these appeals was to settle that issue with an authoritative statement by this Court. Crennan J endorses a principle similar to that stated by Gleeson CJ101, although she ultimately relies on the conclusion of Heydon J that directions incorporating the criminal standard were in fact given in the trial of OAE102. It is apparent from the analysis of Kiefel J103 that her Honour considers that, because the relevant evidence was relied upon for a purpose other than "disclosing [OAE's] sexual interest" in the complainant104, a direction as to the criminal standard of proof was not required. 98 See reasons of Hayne J at [196]. 99 Reasons of Gleeson CJ at [29]-[32], [37]. 100 Reasons of Heydon J at [339], [376], [395]-[396]. 101 Reasons of Crennan J at [477]. 102 Reasons of Crennan J at [483]. 103 See reasons of Kiefel J at [512]-[513]. 104 Reasons of Kiefel J at [517]. Kirby I support the conclusion of Hayne J. It is necessary and desirable for this Court to resolve the issue concerning directions to be given on the standard of proof applicable to evidence of "uncharged acts" for the guidance of trial judges and intermediate courts still observing the common law in this respect. I would hold that wherever such evidence has been admitted under the Pfennig test and is propounded as relevant to a step in reasoning towards the accused's guilt of an offence charged, the jury must be told that they are to be satisfied beyond reasonable doubt that such evidence has been proved before they reason that the accused is guilty on the basis of it105. This is the essential quid pro quo for allowing such evidence to be placed before the jury at all. It is mandated by considerations of law but also of basic fairness, considered in the context of an accusatorial trial that still observes rules of particularity as to the offences charged. Defective direction in OAE: I agree with Hayne J that, taking their directions as a whole, the trial judges in the cases of HML and SB made it adequately clear that the jury were to apply a criminal standard of proof in deciding whether or not to accept and use the evidence of "uncharged acts" relied on by the prosecution. In each of those cases, this conclusion hinges upon recognising the effectiveness of a generalised definition statement (to the effect that where the trial judge spoke of "proof" he meant to the criminal standard) as colouring later directions specific to the contested evidence. The use of such a statement passes muster (although only just, in my view) in the context of the jury charges given in the trials of HML and SB. Nevertheless, like Debelle J in dissent in the Court of Criminal Appeal, and alike with Hayne J106 and Gummow J107, I am of the view that the direction given to the jury in the trial of OAE was inadequate. As Heydon J notes108, the trial judge in the case of OAE told the jury, towards the beginning of his summing up, that: "If, in the course of my summing up, I speak of matters being proved or being established to your satisfaction, or if I use some other expression relating to proof of matters in issue, then you will understand that I shall always mean proof beyond reasonable doubt." 105 Reasons of Hayne J at [132], [244]. 106 Reasons of Hayne J at [245]. 107 Reasons of Gummow J at [42]. 108 Reasons of Heydon J at [395]. Kirby However, when the trial judge later turned to address what he described as "the evidence of the uncharged acts", he did not use any of these terms, or any terms analogous, to indicate that satisfaction to the criminal standard, as earlier described, was a prerequisite to making positive use of that evidence. It is true that he warned the jury that "you cannot convict the accused of any count contained in the information simply because you are satisfied that he committed one or more of these uncharged acts". But this was in the context of a negative direction, properly given, against pure propensity reasoning. As Debelle J concluded, when subsequently describing the "permissible use to be made of the uncharged acts", the trial judge made "no reference of any kind to the standard of proof of [those] acts"109. Contrasting directions in three trials: A contrast may be drawn with what was said by the respective judges in the trials of HML and SB. In the trial of HML, the judge said "I direct you that you may not act upon the evidence of the uncharged acts unless and until you are satisfied as to it" (emphasis added). This expressly picked up an earlier direction to the effect that "if I use words like … 'satisfied' … what I always mean is proved beyond reasonable doubt". Similarly, in the case of SB, the trial judge gave instructions to the jury as to how they could use the "uncharged acts" evidence admitted in that case if they were "satisfied that it is proved, or … satisfied any of the [uncharged] acts referred to in [the complainant's] evidence are proved". The condition thus placed on use of the evidence was clearly referable to the trial judge's earlier statement that "when I use those words ['proved' and 'satisfied'], I mean proof or satisfaction beyond reasonable doubt". No similar link can be drawn between different parts of the trial judge's directions in the case of OAE. I agree with Debelle J, for the reasons that his Honour gave, that subsequent remarks made by the trial judge in connection with a Longman warning110 were inadequate, and indeed inapplicable, to cure this defect111. General statements about standard of proof: Heydon J (with whom Crennan J agrees on this issue112) also relies on other general statements made by the trial judge as to the issue of the standard of proof elsewhere in his summing 109 O, AE (2007) 172 A Crim R 100 at 108-109 [39] (emphasis added). 110 See Longman v The Queen (1989) 168 CLR 79; [1989] HCA 60. 111 O, AE (2007) 172 A Crim R 100 at 110 [41]. 112 Reasons of Crennan J at [483]. 113 Reasons of Heydon J at [395]. Kirby "The trial judge directed the jury about the duty of the prosecution to 'prove the charge and every ingredient of the charge beyond a reasonable doubt'. He also said that an 'accused person cannot be convicted of a crime unless the jury is satisfied of his guilt beyond a reasonable doubt'." In my respectful opinion, it is not a safe assumption that the jury would have taken such generalised directions as those described by Heydon J as indicating anything in particular when it came to the task of evaluating the evidence of the "uncharged acts". The lack of clarity in the trial judge's directions in this connection was compounded by the extreme vagueness of his instruction that the "only legitimate use" of the "uncharged acts" evidence was to "put the charged offences … in their proper context"114. Who can say, for instance, whether or not the jury would have taken evidence said to be available for the sole purpose of providing "context" as comprising an "ingredient of [one of] the charge[s]" obliging proof to the criminal standard? If the trial judge intended his initial and general directions on the matter of proof to infuse his later and particular directions on the "uncharged acts", the links made between them were no more than implicit and extremely tenuous. At the very least, they should have been repeated, amplified and made explicit. "The trial judge also said: 'You cannot convict the accused unless you are satisfied beyond a reasonable doubt about the truth and accuracy of her evidence.' In this passage he did not limit the 'evidence' of the complainant to that relating to the incidents underlying the counts charged." This proposition, however, is also questionable given that, in the same paragraph of his summing up, the trial judge indicated that "you cannot find [the accused] guilty of a charge unless you are satisfied beyond reasonable doubt that [the complainant] gave a truthful account and an accurate account in respect of the incident upon which the charge is based" (emphasis added). This may or may not be regarded as a qualification to the passage quoted by Heydon J. At the very least, it is unclear whether that passage speaks, in any meaningful sense, to the standard of proof with regard to the "uncharged acts". It cannot be assumed that the jury would have discerned any intended connection. To attribute such sophisticated reasoning to a jury is to indulge in an unconvincing fiction. The indeterminacy of the trial judge's later direction on the use of the "uncharged acts" evidence is a further source of difficulty. It leaves entirely ambiguous the degree to which information providing "context" ought to be regarded as integral 114 cf O, AE (2007) 172 A Crim R 100 at 109 [40]. 115 Reasons of Heydon J at [395]. Kirby to "the incident upon which the charge is based" (and therefore subject to the same standard of proof as other facts founding that charge). Adequate reservation at OAE's trial: Finally, Heydon J points to an exchange between trial counsel for OAE and the trial judge, which took place at the conclusion of the summing up, as establishing that counsel considered that a proper direction as to the standard of proof had been given116. That exchange, which I will reproduce in full, is recorded in the transcript as follows: "[COUNSEL]: … [I]n relation to the uncharged acts I may have missed your Honour's direction as to the standard of proof with respect to those acts. I would submit that the jury would need to be satisfied of the totality of those very vague allegations beyond reasonable doubt before they can use them in any contextual sense. HIS HONOUR: I disagree." Heydon J would take counsel's request for a direction to the jury that they must be satisfied "of the totality" of the uncharged acts beyond reasonable doubt as indicating his satisfaction that the jury had already been instructed that they must be satisfied that the individual uncharged acts had been proved to that standard, if they were to use them. However, it is not at all clear that counsel intended those words to colour the entirety of his request. The reference to the "totality" appears to be a request that each and every element of the evidence comprising the "very vague allegations" of uncharged acts should be subject to an express instruction to apply the criminal standard of proof. The natural implication of counsel's statement that he "may have missed" the direction as to the standard of proof was that he had not perceived that such a direction had been given at all, or at least given clearly. Because there was no significant argument on this point, and because the trial judge did not elaborate his reasons for refusing counsel's request, it would be unwise to read too much into the exchange. At this stage, this Court is at risk of relying on trifles to rebuff a point that was adequately reserved before the trial judge. As this Court and intermediate courts know only too well, in the highly charged circumstances of criminal trials, the problem for accused persons is to secure counsel who are vigilant enough to detect a possible error and forward enough to raise it for a ruling by the trial judge. Trial counsel sufficiently did this in the trial of OAE. And in any case, the contestable subjective belief of counsel at the trial is not determinative of whether an error intervention. Inescapably, the responsibility of deciding that question falls on appellate judges fact occurred, demanding appellate 116 Reasons of Heydon J at [396]. Kirby whose touchstones in criminal appeals are legal accuracy and the prevention of miscarriages of justice. Ensuring the application of the correct standard of proof is fundamental to the proper conduct of a criminal trial. This Court should not encourage directions that invoke that standard only through implicit or indirect formulae linked to generalised statements as to the nature of "proof". Where such formulae are employed, terminological precision is required to ensure, at the very least, that the points at which the generalised definition is being referred to during the course of the summing up are adequately clear. Juries cannot reasonably be expected on their own initiative to make the kind of logical leap that is postulated to redress deficiencies of the kind evident in the directions in the trial of OAE. Conclusion: a serious omission: Once it is accepted that the jury, in a case of this kind, are to be instructed that relationship and "contextual" evidence and evidence of uncharged acts, where admitted, must be established to the jury's satisfaction beyond reasonable doubt if it is to be accepted, it is necessary that an appropriate direction be given with clarity. It is dangerous for the instruction to be wrapped up in a general definition of the meaning of "proof". Whilst, in the setting of the entire charge, with some hesitations on my part, that course suffices to save the directions given by the trial judges in the cases of HML and SB, it is not adequate to sustain the directions in the case of OAE. Counsel at trial was correct to perceive and reserve the point. The trial judge erred in failing to clarify his directions. Because what is involved in the directions to the jury concerning OAE is an instruction on the standard of proof to be applied to the evidence, a fundamental matter, this is not an instance, inadequacy of direction being found, in which the "proviso"117 might be applied. The primary rule in criminal appeals therefore applies. The appeal must be allowed and a retrial of OAE ordered. Orders In all three appeals, I agree in the orders proposed by Hayne J. 117 Criminal Law Consolidation Act 1935 (SA), s 353(1). Hayne The issues An accused is charged with sexual offences against a complainant. Absence of consent is not an element of the offences charged. The complainant can give evidence of other sexual acts directed at the complainant by the accused. First, is that evidence relevant and admissible? Second, if admitted, what directions should the trial judge give about that evidence? The appellants in the first two matters (HML and SB), and the applicant for special leave to appeal in the third matter (OAE), seek to raise both of the questions just identified. The appellants in the first two matters, HML and SB, require leave to amend their grounds of appeal to raise the first question about reception of evidence of other sexual conduct. That leave should be granted in the case of HML, but refused in the case of SB. Relevance and admissibility It is neither necessary nor desirable to consider questions of the relevance or admissibility of evidence of this kind in a case where the only offence being tried is one in which absence of consent is an issue. What is said in these reasons is directed only to cases in which absence of consent is not an element of an offence being tried. The evidence, in the cases of HML and OAE, of other sexual acts directed at the complainant by the accused, which were not acts the subject of the charges being tried, was relevant. If accepted, that evidence would show that the accused had a sexual interest in the complainant which he had demonstrated by those other acts. Proving that the accused not only had that sexual interest, but had given expression to that interest by those acts, made it more probable that he had committed the charged acts. Proof of the other acts would thus constitute an element in the circumstantial proof of the offences charged. The question of admissibility of the evidence of other sexual acts directed at the complainant by the accused is to be resolved by first recognising that the evidence, if accepted, proves acts of the accused which are not the subject of a charge being tried but which are at least discreditable to the accused. In many cases the evidence, if accepted, would show not just discreditable conduct, it would show the commission of other offences. Because the evidence shows other discreditable conduct, or in many cases the commission of other offences, it is generally inadmissible. The prosecution cannot "adduce evidence tending to shew that the accused has been guilty of criminal acts other than those covered by the indictment, for the purpose of leading to the conclusion that the accused is a person likely from his criminal Hayne conduct or character to have committed the offence for which he is being tried"118. But that rule is not absolute. Admissibility of evidence of other sexual acts directed at the complainant by the accused, which are not acts the subject of charges being tried, is to be determined by applying the test stated in Pfennig v The Queen119. It is not to be determined by asking whether the evidence in question will put evidence about the charges being tried "in context", or by asking whether it describes or proves the "relationship" between complainant and accused. Evidence of other sexual conduct which would constitute an offence by the accused against the complainant will usually satisfy the test stated in Pfennig. It will usually satisfy that test because, in the context of the prosecution case, there will usually be no reasonable view of the evidence, if it is accepted120, which would be consistent with innocence. That is, there will usually be no reasonable view of the evidence of other sexual conduct which would constitute an offence by the accused against the complainant other than as supporting an inference that the accused is guilty of the offence charged. In Pfennig121, the relevant question is stated as "whether there is a rational view of the evidence that is consistent with the innocence of the accused" (emphasis added). Elsewhere, the relevant question has been put negatively – whether there is a rational view of the evidence of other conduct that is inconsistent with the guilt of the accused122. The test, no matter whether it is stated positively (consistent with innocence) or negatively (inconsistent with guilt), does not require that the evidence of other conduct, without more, prove guilt of the charged offence. Rather, as the reference made in Pfennig123 to the remarks of Dawson J in Sutton v The Queen124 demonstrates, the inquiry is 118 Makin v Attorney-General for New South Wales [1894] AC 57 at 65. 119 (1995) 182 CLR 461; [1995] HCA 7. 120 Phillips v The Queen (2006) 225 CLR 303 at 323-324 [63]; [2006] HCA 4. 121 (1995) 182 CLR 461 at 483. 122 Sutton v The Queen (1984) 152 CLR 528 at 564 per Dawson J; [1984] HCA 5; R v Vonarx [1999] 3 VR 618 at 623 [17]. 123 (1995) 182 CLR 461 at 483. 124 (1984) 152 CLR 528 at 564. See also Hoch v The Queen (1988) 165 CLR 292 at 296; [1988] HCA 50; Harriman v The Queen (1989) 167 CLR 590 at 602; [1989] HCA 50. Hayne whether the evidence in question supports an inference that the accused is guilty of the offence charged, and is open to no other, innocent, explanation. In cases of the present kind, evidence of other sexual conduct which would constitute an offence by the accused against the complainant shows that the accused had then demonstrated a sexual interest in the complainant, and had been willing to give effect to that interest by doing those other acts. The strength of the connection between the offences being tried and the other acts will be affected by the temporal proximity of one to the other and the frequency of occurrence of the other acts. Generally speaking, however, there usually will be no reasonable view of other sexual conduct which would constitute an offence by the accused against the complainant, even if it is an isolated incident and temporally remote, which would do other than support an inference that the accused is guilty of the offence being tried. If a comparison between probative value and prejudicial effect must be undertaken, the probative value of evidence tendered to establish other sexual conduct which would constitute an offence by the accused against the complainant would work a disadvantage to the accused. It would work a disadvantage to the accused because it could constitute a step in reasoning towards guilt. But its admission would work no prejudice to the accused over and above what the evidence establishes. Evidence of other conduct which did not constitute any offence, but which it is alleged demonstrated the accused's sexual interest in the complainant (as was the case with HML), may present more difficult issues. It may be harder to decide whether, in the context of the prosecution case, there would be no reasonable view of that evidence consistent with innocence. Deciding whether the evidence, if accepted, demonstrated the accused's sexual interest in the complainant will, in some cases, turn upon the construction put on the conduct in question. That conduct may be equivocal. If interpreting that conduct as showing sexual interest depends upon the prior acceptance of other evidence of separate events demonstrating that interest, evidence of the conduct would not be admissible. Pfennig v The Queen Because the admissibility of evidence of the kind in question in the present cases is to be determined by applying the test stated in Pfennig, it is as well to say something more about that decision and about its application. Pfennig establishes the rule that governs the admission of evidence that will reveal an accused person's commission of discreditable acts other than those that are the subject of the charges being tried. The rule takes as its premise that evidence of other discreditable acts of the accused is ordinarily inadmissible. The foundation for the rule excluding evidence of other discreditable acts of an Hayne accused is that, despite judicial instruction to the contrary, there is a risk that the evidence will be used by the jury in ways that give undue weight to the other acts that are proved. That is why the exception to that general rule of exclusion is drawn as narrowly as it is by Pfennig. It is why Pfennig requires that evidence of other acts may be admitted only if it supports the inference that the accused is guilty of the offence charged, and the evidence of those other acts is open to no other, innocent, explanation. But it also follows from the considerations that have just been mentioned that the exclusionary rule is not to be circumvented by admitting the evidence but directing the jury to confine its uses. There are several points to make about attempts to divide the uses to which evidence of other discreditable acts of an accused may be put. The division suggested may be variously expressed, but its general nature is captured by expressions like "propensity", "disposition", or "tendency" on the one hand, and "context", "explanation", or "intelligibility" on the other. There are at least two reasons not to attempt any such division. First, it may greatly be doubted that a division of uses expressed in those or similar terms will provide any useful guidance to jurors. The meaning and application of the expressions is anything but readily apparent, even to lawyers. Secondly, and more fundamentally, the foundation of the general exclusionary rule is that uses of the evidence cannot be segregated in the manner suggested. The very risk to which the general rule of exclusion is directed is the risk that the evidence will be misused. Judicial directions about use of such evidence have not hitherto been seen, and should not now be seen, as solving that problem. The possible uses to which evidence of other acts (which does not meet the Pfennig test) may be put are inevitably so intertwined that they cannot be sufficiently disentangled to give useful instructions to the jury. And even if the various uses of such evidence could be disentangled, that would leave unaddressed and unanswered the further difficulty that the jury may attach more significance to the evidence of other acts than they should. That is why the solution that has been adopted for so long by the common law, reflected in this Court's decision in Pfennig, is to limit the circumstances in which evidence of other discreditable acts of an accused will be received in evidence. If the evidence of other discreditable acts does not meet the Pfennig test, it is not to be admitted. It is unnecessary then to consider any division of uses to which the evidence may be put. And if the evidence of other acts does meet the Pfennig test, it is neither necessary nor desirable to attempt a division of uses of the kind described earlier. In deciding the question of admissibility presented by Pfennig, the trial judge is not called on to decide whether the evidence which the prosecution intends to adduce does or does not establish the accused's guilt. In most cases, perhaps all, that inquiry could not be undertaken. To ask whether evidence Hayne proves guilt would not be possible because the trial judge will usually be required to decide disputed questions of admissibility before any, or at least all, of the evidence to be called by the prosecution has been adduced. That is why, as the Court pointed out in Phillips v The Queen125, "the test [in Pfennig] is to be applied by the judge on certain assumptions. Thus it must be assumed that the similar fact evidence would be accepted as true and that the prosecution case (as revealed in evidence already given at trial or in the depositions of witnesses later to be called) may be accepted by the jury. Pfennig v The Queen does not require the judge to conclude fact evidence, standing alone, would demonstrate the guilt of the accused of the offence or offences with which he or she is charged126." (emphasis added) the similar that Rather, as the Court went on to say127 in Phillips, Pfennig requires the judge to exclude the evidence if, viewed in the context and way just described, there is a reasonable view of the similar fact evidence which is consistent with innocence. And as thus appears from what was said in Phillips, the trial judge is not called upon to make some separate or sequential assessment of evidence to be led at the trial in which it is necessary or relevant to ask whether the evidence, with or without the material whose admissibility is being considered, would support a verdict of guilt. Rather, the determinative question is whether there is a reasonable view of the similar fact evidence which is consistent with innocence. And as explained earlier, in cases of the kind now under consideration (in which absence of consent is not an issue) there usually will be no reasonable view of other sexual conduct which would constitute an offence by the accused against the complainant which would do other than support an inference that the accused is guilty of the offence being tried. Jury directions The directions that should be given where a complainant gives evidence of sexually improper conduct, other than the conduct which is the subject of the charges preferred against the accused, will vary from case to case. What follows in these reasons is not put forward as a model direction. It is not expressed in terms that are suitable to that purpose. Not all of the matters mentioned later as appropriate for consideration in framing suitable directions will find express 125 (2006) 225 CLR 303 at 323-324 [63]. 126 cf the remarks of the Supreme Court of Canada in R v Handy [2002] 2 SCR 908 at 127 (2006) 225 CLR 303 at 324 [63]. Hayne reflection in what the jury are told. And, of course, there may be additional matters that should be reflected in the directions that are given. Further, and more fundamentally, any suggested forms of direction put forward as "standard" or "model" directions will very likely mislead if their content is not properly moulded to the particular issues that are presented by each particular case. Model directions are necessarily framed at a level of abstraction that divorces the model from the particular facts of, and issues in, any specific trial. That is why such directions must be moulded to take proper account of what has happened in the trial. That moulding will usually require either addition to or subtraction from the model, or both addition and subtraction. The fundamental propositions stated by the Court in Alford v Magee128, which have since been referred to many times129, must remain the guiding principles. First, the trial judge must decide what are the real issues in the particular case and tell the jury, in the light of the law, what those issues are. Second, the trial judge must explain to the jury so much of the law as they need to know to decide the case and how it applies to the facts of the particular case. Neither purpose is adequately served by the bare recitation of forms of model directions. Not only are the real issues not identified for the jury, no sufficient explanation is given to the jury of how the relevant law applies to the facts of the particular case. But the particular facts and circumstances of these three cases reveal that it may be necessary for trial judges to consider at least the following matters in framing the directions to give to a jury about evidence of other sexual conduct of an accused directed at the complainant but which is not conduct the subject of charges being tried. First, framing appropriate directions self-evidently depends upon how the trial has proceeded. Accordingly, in most cases it will be desirable, before evidence is led, to ask the prosecutor to identify (a) what evidence will be 128 (1952) 85 CLR 437 at 466; [1952] HCA 3. 129 See, for example, Libke v The Queen (2007) 81 ALJR 1309 at 1327-1328 [86]; 235 ALR 517 at 540; [2007] HCA 30; Clayton v The Queen (2006) 81 ALJR 439 at 444 [24]; 231 ALR 500 at 506; [2006] HCA 58; Tully v The Queen (2006) 230 CLR 234 at 256-257 [75]-[76]; [2006] HCA 56; Nicholls v The Queen (2005) 219 CLR 196 at 321-322 [372]; [2005] HCA 1; Doggett v The Queen (2001) 208 CLR 343 at 373 [115]; [2001] HCA 46; KRM v The Queen (2001) 206 CLR 221 at 259 [114]; [2001] HCA 11; Azzopardi v The Queen (2001) 205 CLR 50 at 69 [49]; [2001] HCA 25; Zoneff v The Queen (2000) 200 CLR 234 at 256-257 [56]; [2000] HCA 28; RPS v The Queen (2000) 199 CLR 620 at 637 [41]; [2000] HCA 3; Melbourne v The Queen (1999) 198 CLR 1 at 52-53 [143]; [1999] HCA 32. Hayne adduced which may demonstrate sexual conduct towards the complainant, other than the conduct founding the charges being tried, and (b) how it is alleged the evidence is relevant. It will usually be necessary, and helpful, to have the prosecutor describe each step along the path (or paths) of reasoning from the intended proof of other sexual conduct which it is expected that the prosecutor will submit that the jury may follow. The evidence may be relevant for more than one reason. The kinds of use to which it is possible to put evidence of offences or other discreditable acts other than those being tried are indicated in r 404(b) of the United States Federal Rules of Evidence130 with its reference to "proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident". In 1994, the Federal Rules of Evidence were amended131 to make special provision132 governing evidence of similar crimes and similar acts in cases concerning sexual assault and child molestation. It is not necessary to examine those provisions. For the moment it is sufficient to confine attention to r 404(b) as indicating possible kinds of use of evidence of offences or other discreditable acts other than those being tried. It is as well to add, however, that it may be doubted that the list given in the rule is exhaustive133 and that, in any event, leading American commentators point out that the decision whether to admit the evidence "is not to be made simply by labeling the evidence"134. As the plurality reasons in Pfennig rightly pointed out135: 130 Rule 404(b) provides: "Other crimes, wrongs, or acts. — Evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show action in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident, provided that upon request by the accused, the prosecution in a criminal case shall provide reasonable notice in advance of trial, or during trial if the court excuses pretrial notice on good cause shown, of the general nature of any such evidence it intends to introduce at trial." 131 Violent Crime Control and Law Enforcement Act of 1994. 133 See, for example, Imwinkelried, Uncharged Misconduct Evidence, (1984). 134 Wright and Graham, Federal Practice and Procedure, (1978), vol 22 at 538 §5249. 135 (1995) 182 CLR 461 at 464-465 per Mason CJ, Deane and Dawson JJ. Hayne "There is no one term which satisfactorily describes evidence which is received notwithstanding that it discloses the commission of offences other than those with which the accused is charged. It is always propensity evidence but it may be propensity evidence which falls within the category of similar fact evidence, relationship evidence or identity evidence. Those categories are not exhaustive and are not necessarily mutually exclusive. The term 'similar fact' evidence is often used in a general but inaccurate sense." (emphasis added) It is because shorthand terms like "relationship evidence" are inexact, that the purpose or purposes for which it is sought to adduce the evidence will seldom be sufficiently expressed by simply using that or some other shorthand description. It is the identification of each step along the path of reasoning that is necessary and useful. Second, as is often the case in relation to disputed questions of admissibility of evidence at a criminal trial, comparisons between prejudicial effect and probative value may be invited when considering reception of the evidence of sexual conduct other than the offences being tried. In drawing such comparisons, the important consideration is what prejudice, distinct from what the evidence proves, the accused may suffer if the evidence is adduced. In this regard it is important to recall that in cases of the kinds now under consideration the other acts and events which it is sought to prove will seldom be of a kind or quality that is radically different from the conduct which is charged. Further, the evidence of other acts and events will often not have the specificity and particularity of evidence led about the charged acts. This lack of specificity will be unlikely to constitute prejudice to an accused of a kind that outweighs the probative value properly attributed to the evidence of other conduct. If it is submitted that a comparison must be made between the probative value and prejudicial effect of evidence of other conduct it would be rare that the comparison will be important in framing directions to the jury, but possible forms of prejudice that are identified, and are distinct from what the evidence proves, may inform consideration of what the jury should be told about use of the evidence. Third, if not by the end of the evidence, then certainly by the end of counsel's addresses, it will be apparent what use the parties have sought to make of the evidence of other sexual conduct. And in any event, the trial judge will then have to decide what are the real issues in the case and what is the law that the jury need to know to decide those issues. Both the relevance of the evidence of other events, as that relevance was identified at the outset of the trial, and any possible forms of prejudice that were said to follow from its admission, will very likely bear upon how the directions should be framed. And proper identification of the real issues in the case may mean that it is unnecessary to give any direction Hayne to the jury about some of the uses to which the evidence might be put (in particular its use in providing the context within which events the subject of charges are said to have occurred). Fourth, in framing directions to the jury about evidence of events of a sexual kind other than those that are the subject of charge it will seldom, if ever, be helpful to speak of "propensity" or "disposition". "Propensity" and "disposition" are words that jurors are not likely to find helpful. And as pointed out in Pfennig136, the evidence of other criminal acts or other discreditable conduct is propensity evidence. Further, it will usually be better not to describe the evidence of other events of a sexual kind as evidence of "uncharged acts". "Uncharged acts" suggests that what is described could have been the subject of charges. That may not be right. The conduct described may not be criminal; the description of the conduct may not be sufficiently specific to found a charge. Describing the events as "uncharged acts" may invite speculation about why no charges were laid. Fifth, the jury must be told to consider separately each charge preferred against the accused. The jury must be told to consider all of the evidence that is relevant to the charge under consideration. The jury must be told that they may find some evidence of a witness persuasive and other evidence not. And the jury must be told, therefore, that they must consider all of the evidence that the complainant gave and, if the accused gave evidence, all of his or her evidence, but that, like the evidence of every witness, they may accept or reject parts of the evidence each gave. Sixth, it may be appropriate, in some cases, to tell the jury that they do not have to decide whether the other sexual conduct occurred. That is, it may be appropriate to tell the jury that they may be persuaded of the accused's guilt of one or more charges even if they are unable to decide, or do not find it necessary to consider, whether any of that conduct occurred. Conversely, if they are persuaded that the other conduct did occur they may entertain a reasonable doubt of guilt in respect of any of the charges. Seventh, the directions about how the evidence may be used by the jury will reflect not only what uses the parties have sought to make of it in argument, but also the legal basis for its admission. The evidence of other acts is admissible if it meets the test in Pfennig. That being so, it will be necessary to tell the jury that if, on all the evidence, they are persuaded beyond reasonable doubt that some or all of the other acts did occur, that conclusion may help them in deciding whether the charge under consideration is established. It may help them because showing that the accused had acted in that sexual way towards the 136 (1995) 182 CLR 461 at 464-465. Hayne complainant on one or more other occasions may show that the accused had demonstrated that he had a sexual interest in the complainant and had been willing to give effect to that interest by doing those other acts. If persuaded of those facts, the jury may think that it is more likely that the accused did what is alleged in the charge under consideration. But whether any of the other events happened, and if any did, whether their occurrence makes it more likely that, on a different occasion, the accused did what he is charged with doing, are matters for the jury. And even if the other events did happen, the conclusion that the accused did what is charged is not inevitable. The jury must always decide whether, having regard to all the evidence, they are persuaded beyond reasonable doubt that the charge they are considering has been proved. HML was charged in the District Court of South Australia with two counts of unlawful sexual intercourse with a person under 12 years contrary to what was then s 49(1) of the Criminal Law Consolidation Act 1935 (SA). The offences were alleged to have occurred between 27 September 1999 and 4 October 1999 at Adelaide and in the one case were said to be constituted by causing the complainant to perform an act of fellatio upon him and in the other by inserting his penis into her anus. At the time of the alleged offences the complainant was aged about nine. She was 15 at the time of the appellant's trial. The complainant was the appellant's daughter, but the relationship between complainant and appellant was not an element of the offences charged against him. The complainant's parents were separated from the time she was a baby. At the times material to the present matter the appellant lived in Victoria and the complainant lived in South Australia but visited the appellant from time to time. The offences were alleged to have taken place in an Adelaide hotel. The complainant had travelled to Adelaide with the appellant when the appellant went to Adelaide in connection with some surgery. On the prosecution case the offences charged were part of a long course of conduct by the appellant that started when the complainant was about seven years of age and finished when she was about 12. Many of the events which the complainant described in evidence occurred in Victoria and were not (and could not have been) the subject of prosecution in the courts of South Australia. Although Victoria Police investigated the complainant's allegations of offences committed in Victoria, charges were not brought against the appellant in that State. At trial, the appellant was convicted on both counts. By leave, he appealed to the Full Court of the Supreme Court of South Australia against the convictions. A number of grounds were advanced. The principal focus of his Hayne appeal to the Full Court was that, at trial, he should have been permitted to adduce evidence that he had not been charged with offences in Victoria. The Full Court (Nyland, Vanstone and White JJ) dismissed137 his appeal. By special leave, the appellant appealed to this Court. He maintained his contention that he should have been permitted to adduce evidence that no charges had been laid in Victoria and he alleged that the trial judge's directions given about police investigations into events in Victoria were inadequate. He further alleged that the Full Court should have held that the directions given by the trial judge "as to the use to which the jury could and could not use the uncharged acts were inadequate". In the course of the hearing of the appeal to this Court he sought leave to add additional grounds of appeal alleging that "the evidence of the uncharged acts" was inadmissible. The application for leave to amend was not opposed. It should be granted. It is convenient to deal first with the questions about admission of "the evidence of the uncharged acts" and to begin with the procedures that were followed in deciding its admissibility. Evidence of other sexual conduct Section 285A of the Criminal Law Consolidation Act permits a court before which a person has been arraigned, if it thinks fit, to hear and determine "any question relating to the admissibility of evidence, and any other question of law affecting the conduct of the trial, before the jury is empanelled". The relevant Rules of the District Court138 required the giving of notice of objections to evidence that it was expected that the prosecution would lead and the appellant gave notice that he would object to evidence of uncharged acts. There was, therefore, argument before the jury was empanelled about the admissibility of evidence which the complainant's statements to police indicated she could give about other conduct of the appellant, of a sexual kind, directed towards her. There was no voir dire in relation to this evidence. Argument proceeded by reference only to the complainant's written statements to police. After hearing argument, the trial judge ruled that "the evidence can be led". No reasons were given for the ruling. It is necessary, therefore, to say something more about the parties' arguments. 137 R v H, ML [2006] SASC 240. 138 District Court (Criminal and Miscellaneous) Rules 1992, r 9.01. Hayne Trial counsel for the prosecution began her submissions by accepting that it was "difficult to follow" what the complainant was alleging had happened, and when it had happened. In part, perhaps in large part, this was because the complainant's statements appear to have exhibited uncertainty about when various events occurred. So, for example, one of her statements described an incident where the appellant got into the shower with her and rubbed his penis against her body, but the complainant said of that incident that she did not remember "when this was or how old I was". Yet it was plain that the complainant would, if permitted, give evidence to the effect that "most of the time" when she stayed with her father in Victoria "he would finger me, stick his tongue in my mouth, [and] sometimes when he was fingering me he would try and stick his penis in my bum". A single body of material? At the pre-trial hearing, the proposed evidence of other events was treated as a single body of material about "uncharged acts" which either was all to be admitted or was all to be rejected. This treatment of the matter leads to some difficulty in deciding the ambit of the objection. In particular, it is not clear whether the objection extended to evidence of all forms of sexual conduct allegedly directed at the complainant, regardless of whether that conduct would have constituted an offence. It will be necessary to return to this question. In other respects, treating the evidence of other conduct as a single body of material reflects the great practical difficulty that there may be in dividing that evidence into separate parts. The difficulty stems from the fact that the charged incidents necessarily take their place against a background formed by all of the sexual conduct of the accused towards the complainant. So, for example, in the present case, the complainant's evidence about the first count charged (the count alleging fellatio) was that she asked her father whether she could go shopping in Adelaide, that he had replied by saying that she could if she sucked his penis, and that she had complied. Her evidence about the second count (alleging anal penetration) was that the appellant had said immediately after the incident: "Why isn't it working? It's worked before." This evidence about the charged acts would probably have made little sense without reference to what had gone before. But it shows how difficult it may be to cut up an account of events of this kind and confine evidence to particular charged incidents. That difficulty was not explored in the courts below. The assumption which underpinned the pre-trial argument about admissibility was that the evidence of "uncharged acts" (as a whole) could be separated from the complainant's evidence about the matters charged. Hayne Bases for admission at trial Trial counsel for the prosecution submitted that there were several bases upon which the evidence of "uncharged acts" was relevant and admissible. Four were identified. First, it was said that the continuing course of conduct created the context in which the alleged offences occurred and that, without evidence of that context, "the jury would be left thinking what occurred in Adelaide just occurred out of the blue". The second basis was said to be that from the evidence the jury might conclude that the appellant was confident enough to offend against the complainant in the manner in which it was alleged he had in Adelaide and that it would explain why the complainant "simply ... submitted to that particular conduct". Thirdly, it was said that the evidence of uncharged acts before and after the events charged was capable of demonstrating that the appellant "was someone who had a sexual attraction for the complainant". Trial counsel for the prosecution submitted that this was different from "propensity-type reasoning" but that it did "tend to provide an explanation as to why it is that the offending in Adelaide may have occurred". Finally, trial counsel for the prosecution submitted that the evidence might explain why it was that the complainant did not make a complaint immediately about the offending which had taken place in Adelaide. Trial counsel for the appellant submitted that the evidence of other events was unnecessary for any of the purposes identified by trial counsel for the prosecution. But those submissions, though elaborated, did not distinctly deny the relevance of the evidence. Instead, emphasis was given to the imprecision of the proposed evidence. The course of argument about the admissibility of evidence about the appellant's other sexual conduct towards the complainant is explained by reference to what had been held by the Full Court of the Supreme Court of South Australia in R v Nieterink139. In that case, Doyle CJ, with whose opinion the other members of the Court agreed, said140 that the evidence of "uncharged acts" in issue in that case was admissible on a number of bases: "First, it could explain how the first charged incident came about, because it showed what might be called a lead up to the first charged incident. It could also explain the lack of surprise on the part of [the complainant]. It could explain the confidence that the appellant might have had in 139 (1999) 76 SASR 56. 140 (1999) 76 SASR 56 at 72 [76]. Hayne repeating his conduct when committing each of the alleged offences. The submission of [the complainant] to him over a period of time would give him confidence that she would submit again. It might help to explain the fact that [the complainant] did not complain to her mother. The evidence could also establish a sexual attraction by the appellant towards [the complainant]." It is evident that trial counsel for the prosecution in the present matter adopted the analysis reflected in this part of the reasons of Doyle CJ in Nieterink as founding admission of the disputed parts of the complainant's evidence. It will be necessary to return to that analysis. The prosecution case The evidence having been ruled admissible, trial counsel for the prosecution opened the case to the jury indicating that it was the prosecution case that "what happened in Adelaide was not just a one-off incident but that the [appellant] had in fact been engaged in a course of sexually inappropriate behaviour with respect to [the complainant] for a number of years, which took place both before and after that particular trip". Trial counsel for the prosecution concluded her opening by telling the jury what use she submitted could be made of the evidence of the other events of which the complainant would give evidence. As she had indicated in the course of the pre-trial hearing about admissibility of the evidence, four uses of the evidence were proposed: context, confidence to offend, sexual attraction, and explanation for delay in complaint. In examination-in-chief, the complainant was asked whether, before she went to Adelaide, and while staying with the appellant in Victoria, he had behaved in any inappropriate way towards her or in a way that made her feel uncomfortable. She gave evidence of his walking around the house naked, of his kissing her goodnight and trying to "stick his tongue in my mouth" and of his "regularly" getting into bed with her in the morning and digitally penetrating her vagina. She also gave evidence of his asking her to take her clothes off and do cartwheels while he filmed her. Counsel for the prosecution then asked the complainant some questions about g-string underwear. The complainant said that the appellant had bought her this underwear without her asking him to do so. In his evidence, the appellant did not dispute that he had bought the items, but he said that he had done so at the complainant's request. Both at trial and in this Court, a deal of emphasis was given to the complainant's evidence about these items. It was submitted that the evidence, if accepted by the jury, showed that the appellant had a sexual interest in his daughter. Giving these items to the complainant was not unlawful. It was not an "uncharged act" if that expression is understood as referring only to other conduct which, if proved, would constitute an offence. Hayne Argument in this Court proceeded on the premise that the pre-trial objection to evidence of uncharged acts extended to the evidence about underwear. Neither the transcript of the pre-trial argument nor the notice of objection to evidence made specific reference to this subject. Taken as a whole, the record of the proceedings at trial was consistent with the evidence having been adduced without objection. It is nonetheless useful to consider its relevance and admissibility in the course of considering those questions more generally. The relevance of other sexual conduct It is essential to examine the question of relevance separately from the question of admissibility. Usually, the relevance of the evidence is readily demonstrated. Evidence showing that an accused had a sexual interest in the complainant is relevant at the trial of that accused for committing sexual offences against that complainant because it rationally affects the probability of the existence of a fact in issue141, namely, whether the charged acts occurred. Evidence that shows the accused had a sexual interest in the complainant may also be important in assessing the credibility and coherence of the complainant's evidence generally and, in particular, the account of the events that constitute the offences charged. But the relevance of the evidence of other sexual conduct or events lies in its proof of demonstrated sexual interest in the complainant. The relevance of such evidence in a particular case may or may not be sufficiently captured by describing it as evidence about the nature of the relationship between the complainant and the accused. To describe the evidence as "relationship evidence" or evidence of "guilty passion" is to assert the relevance of the evidence. Although the conclusion about relevance is a conclusion of fact, it is important to expose the steps in reasoning which show the relevance of the evidence. The other conduct described by the complainant in this matter might be divided into three – committing other sexual assaults on her, filming her, and buying the particular style of underwear. All these forms of conduct were tendered to show the expression of a sexual interest of the appellant in the complainant. That interest was said to have been demonstrated by translation of that interest into action, in some cases sexual acts of the kind which constituted the offences being tried. Demonstrating the appellant's sexual interest in the complainant would demonstrate his motive to act as the charges being tried alleged he had acted. Demonstrating that he had done acts of the kind charged on other occasions 141 Martin v Osborne (1936) 55 CLR 367 at 375-376 per Dixon J; [1936] HCA 23; cf Evidence Act 1995 (Cth), s 55. Hayne would make it more likely that he did the charged acts. The extent to which the conduct was repeated, and the temporal proximity of the other conduct to a charged act, would bear upon the probability of the occurrence of that charged act. The evidence was relevant. Was it admissible? Admissibility The proposition for which Makin v Attorney-General for New South Wales142 has so often been quoted, that evidence "merely" demonstrating disposition to crime is inadmissible, points strongly against the utility of argument about admissibility from a premise that has assigned one of the expressions "propensity" or "disposition" to the evidence in issue, without giving the closest attention to the meaning assigned to those words. In particular, as this Court's decision in Pfennig demonstrates, the use of these expressions must not be allowed to set up false dichotomies between evidence that establishes disposition or propensity and evidence that has some other use. Often evidence will not only reveal a disposition to commit criminal or other discreditable acts but also have other uses at trial. That is why, as Julius Stone pointed out 70 years ago143, the relevant root principles are more likely to be found in comparisons of probative value and prejudicial effect than they are in the attribution of labels like "propensity" or "disposition". But whether or not that is right, identifying evidence as showing "propensity" or "disposition" does not conclude an inquiry about the admissibility of that evidence. Understood as the expression of sexual interest in the complainant, all of the evidence of other conduct towards the complainant was discreditable to the appellant. Some of the acts that were not unlawful (such as buying the underwear) may or may not attract less opprobrium than conduct which would constitute an offence. But all of the conduct, whether it showed no more than the expression of sexual interest, or went further and demonstrated a willingness to use the complainant as the object of gratification of that interest, was evidence discreditable of the appellant. It was discreditable because of their relationship as parent and child. 143 "The Rule of Exclusion of Similar Fact Evidence: America", (1938) 51 Harvard Law Review 988. See also Stone, "The Rule of Exclusion of Similar Fact Evidence: England", (1933) 46 Harvard Law Review 954. Hayne Because the evidence showed the commission of offences by the appellant or other discreditable acts on his part, its admissibility was to be determined by applying the test in Pfennig. Until now there may have remained some uncertainty about what test should be applied to decide the admissibility of evidence of other sexual acts or events directed by an accused to a complainant. The nature and extent of that uncertainty can be indicated by comparing the decision of the Full Court of the Supreme Court of South Australia in Nieterink with the decision of the Court of Appeal of Victoria in R v Vonarx144. The focus of debate in Nieterink was upon the several uses which have been identified earlier in these reasons as uses to which the evidence of other sexual conduct could be put: context, confidence to offend, sexual attraction, and explanation for delay in complaint. Because the evidence could be used in these various ways, it was held in Nieterink145 that the evidence was admissible even if it did not meet the test stated in Pfennig. Three of the four uses identified in Nieterink as permissible uses of the evidence (context, confidence to offend, and explanation for delay in complaint) take their chief significance from their use in assessing the coherence and credibility of the complainant's evidence. If those were the only uses to which the evidence could be put, it may be doubted that it would be admissible. Each of these three uses, if they were the only uses to which the evidence could be put, might be said to deal only with collateral issues that should not be explored at trial146. But as was recognised in Nieterink147, the fourth identified use (proof of sexual attraction) could provide a step in reasoning towards guilt. And that is why, in Nieterink, it was held148 that "to the extent that the evidence of uncharged acts were circumstantial evidence explaining [the complainant's] conduct, and the circumstances of the offences, proof beyond reasonable doubt was not required" but that, if used as proof of sexual attraction, proof to that standard was required. 145 (1999) 76 SASR 56 at 66 [48]-[49]. 146 Attorney-General v Hitchcock (1847) 1 Ex 91 at 105-106 per Rolfe B [154 ER 38 147 (1999) 76 SASR 56 at 72-73 [83]. 148 (1999) 76 SASR 56 at 72-73 [83]. Hayne By contrast, in Vonarx it was held149 that the evidence of other sexual acts was led "for the purpose of proving an improper sexual relationship or guilty passion which existed between the accused and the victim, tending to make it more likely that the offence charged in the indictment was in fact committed" (emphasis added). And admission of the evidence for this use was seen in Vonarx150 as consistent with the proper application of the test in Pfennig. Subsequently, in KRM v The Queen, McHugh J examined151 these issues in some detail and concluded152 that "[u]ntil this Court decides to the contrary, courts in this country should treat evidence of uncharged sexual conduct as admissible to explain the nature of the relationship between the complainant and the accused". If there has been uncertainty about what test should be applied in determining whether evidence of other sexual conduct or events should be admitted, the uncertainty may have stemmed from a failure to differentiate sufficiently between questions of relevance and admissibility, and from using shorthand like "relationship", "guilty passion", "propensity" and "disposition" in ways that obscure more than they illuminate. It is not profitable, however, to examine further the extent or causes of that uncertainty. terms In considering questions of admissibility of the evidence of other conduct, it is important to recall that several counts of sexual offences against the one complainant may be joined in a single information or indictment and tried together. The charges are joined, and the information or indictment is not severed, because proof of the accused's commission of a sexual offence against the complainant on one occasion, may make it more likely that the accused committed another similar sexual offence against that complainant which is charged in the one information or indictment153. Evidence of commission of one offence is relevant to and admissible in the trial of the other similar offence 149 [1999] 3 VR 618 at 622 [13]. See also R v Pearce [1999] 3 VR 287 at 297-298 [30]; R v Loguancio (2000) 1 VR 235 at 239-240 [12]; R v BJC (2005) 13 VR 407 150 [1999] 3 VR 618 at 622-623 [11]-[17]. 151 (2001) 206 CLR 221 at 230-233 [24]-[31]. 152 (2001) 206 CLR 221 at 233 [31]. 153 Sutton v The Queen (1984) 152 CLR 528; De Jesus v The Queen (1986) 61 ALJR 1; 68 ALR 1; [1986] HCA 65. Hayne charged. Together, the offences charged constitute "a series of offences of the same or a similar character"154. In the end, however, the admissibility of the evidence of sexual conduct other than that charged turns on the fact that the evidence shows conduct other than the charges being tried, that is illegal, or at least discreditable to the accused. It is because the evidence reveals illegal or discreditable conduct of the accused on occasions other than those giving rise to the charges, and is tendered, at least in part, as proof of a step in reasoning towards guilt, that the question of its admissibility is to be resolved by applying the test stated in Pfennig155. As was noted in the reasons of the plurality in that case156: "Propensity evidence (including evidence of bad disposition and prior criminality) has always been treated as evidence which has or is likely to have a prejudicial effect in the sense explained." That is, evidence of criminal or discreditable conduct other than that charged may have an undue impact, adverse to the accused, on the minds of the jury over and above the impact that it may be expected to have if consideration were confined to its probative force157. And thus the plurality said158 that a trial judge, considering the admissibility of such evidence, "must recognise that propensity evidence is circumstantial evidence and that, as such, it should not be used to draw an inference adverse to the accused unless it is the only reasonable inference in the circumstances. More than that, the evidence ought not to be admitted if the trial judge concludes that, viewed in the context of the prosecution case, there is a reasonable view of it which is consistent with innocence." (footnote omitted) But as pointed out in Phillips v The Queen159, due weight must be given to the necessity to view the similar fact evidence in the context of the prosecution case, 154 Criminal Law Consolidation Act 1935 (SA), Sched 3, r 3. 155 (1995) 182 CLR 461. 156 (1995) 182 CLR 461 at 488 per Mason CJ, Deane and Dawson JJ. 157 (1995) 182 CLR 461 at 487-488. 158 (1995) 182 CLR 461 at 485. 159 (2006) 225 CLR 303 at 323-324 [63]. Hayne and the test of admissibility of that evidence must be applied by the trial judge on certain assumptions. In particular, when considering admissibility, it must be assumed that the similar fact evidence would be accepted as true, and that the prosecution case (as revealed in evidence already given at trial or in the depositions of witnesses later to be called) may be accepted by the jury. Applying Pfennig When such a test is applied to evidence of sexual offences committed by an accused against the complainant (other than the offences being tried) the test stated in Pfennig will usually, if not invariably, be satisfied. Seldom, if ever, would evidence of the commission of generally similar sexual offences against the complainant other than those charged, when viewed in the context of the prosecution case, be consistent with innocence. Or, as the plurality reasons in Pfennig put the same point160 (by reference to Hoch v The Queen161), "the objective improbability of its [the evidence in question] having some innocent explanation is such that there is no reasonable view of it other than as supporting an inference that the accused is guilty of the offence charged" (emphasis added). If the language of propensity or disposition is to be adopted, it is "evidence of a particular distinctive propensity demonstrated by acts constituting particular manifestations or exemplifications of it"162 which is directly connected with the issues for decision in the instant case. It has that "specific connexion with or relation to the issues for decision in the subject case"163 because it shows the accused's willingness to use the complainant as the object of gratification of a sexual interest or attraction that is directed at the complainant. Applying the test stated in Pfennig to evidence of acts which do not constitute sexual offences, but are alleged to disclose the accused's sexual interest in the complainant, may be more difficult. The difficulty lies in deciding whether, and to what extent, the evidence does disclose sexual interest. The evidence tendered in this case about the appellant filming the complainant and buying a particular kind of underwear for her reveals at least some of the issues that will require examination in connection with evidence of that kind. Even if it is assumed that filming the complainant in the circumstances she described constituted no offence, the event, as the complainant described it, had 160 (1995) 182 CLR 461 at 481-482. 161 (1988) 165 CLR 292 at 294-295 per Mason CJ, Wilson and Gaudron JJ. 162 Pfennig v The Queen (1995) 182 CLR 461 at 483 per Mason CJ, Deane and 163 Pfennig (1995) 182 CLR 461 at 483 per Mason CJ, Deane and Dawson JJ. Hayne such sexual overtones as to admit only of the conclusion that it demonstrated the appellant's sexual interest in her. By contrast, the evidence about the underwear was equivocal. At least in hindsight, the complainant saw the appellant's purchase of the underwear as demonstrating sexual interest in her. That view of the event was consistent with the complainant's account of the appellant's conduct generally. The evidence about the purchase of the underwear did not stand alone in the case. Its admissibility was to be judged in the context of the prosecution case and to be judged without knowing what explanation or answer the appellant would make to the evidence. The prosecution case was that the purchase was an objectively verifiable event which revealed sexual interest. (It was objectively verifiable in the sense that a photograph had been taken of two of the three items that were said to have been bought and the photograph was tendered in evidence.) In the context of the prosecution case, if the evidence bore the interpretation asserted, it was a step in proving that the appellant had committed the offences charged. But that step depended upon the interpretation given to the evidence of purchase and gift. And on the complainant's account of the event (an unsolicited gift following her inquiry about what the garments were) it would be open to the jury to interpret it as evidence of sexual interest. But that conclusion was not inevitable. It was not inevitable because the evidence revealed nothing more having been said about or done with the items. The evidence was, therefore, equivocal and the resolution of the equivocation necessarily depended upon proof of the other events described by the complainant. Evidence of the purchase of underwear, though relevant, was not admissible in proof of the appellant's sexual interest in the complainant. No objection having been made at trial to the reception of the evidence, presumably on the basis that it would provide a context for the complainant's account of events, there was no ruling about its admissibility. There was no wrong decision in this respect of a point of law at trial. In this appeal the question that then arises in relation to the evidence about the gift of underwear is confined to the sufficiency of the trial judge's directions about using this evidence and the other evidence of sexual conduct and events other than those charged. Gipp v The Queen The conclusions reached about the application of Pfennig to evidence of the kind in issue in this matter do not accord with the views expressed by Hayne Gaudron J in Gipp v The Queen164. In that case, Gaudron J concluded165 that general evidence of sexual abuse of the complainant on occasions other than those charged did not have "that special probative value which renders evidence admissible as 'similar fact' or 'propensity' evidence" and suggested166 that evidence of sexual abuse on other occasions to explain lack of surprise or failure to complain was admissible only if the defence made either an issue in the case. It is necessary to deal with each of these points. First, the "special probative value", which renders admissible the evidence of other sexual conduct which, if proved, would constitute one or more offences committed by the accused against the complainant, lies in the identity of parties. The central question in the trial is whether the accused committed the charged sexual act or acts. Questions of consent do not arise because absence of consent is not an element of the offence or offences. If accepted, the evidence of other sexual acts would show the commission of other generally similar offences. But if accepted, the evidence would demonstrate that this accused had used this complainant as the object of sexual gratification. It is the particularity of that conclusion which gives the evidence its "special probative value". Secondly, treating evidence of other sexual conduct or events as relating to a lack of surprise or failure to complain, and admissible only if the defence expressly raises such an issue, would inevitably lead to the fragmentation of a complainant's evidence. A complainant could give any evidence of other sexual conduct or events only after the accused had cross-examined in a way that raised the issue. Such fragmentation of the evidence would be very undesirable. But it is necessary to more fundamental considerations about circumstantial proof. to recognise and give due weight Context, completeness, circumstantial proof A complainant's evidence of what happened on a particular occasion will often make little sense (or at least convey a very different picture) if evidence of the occasion in question is not set in its proper factual context. In cases where the complainant and accused are related by blood or marriage, it is not to be doubted that evidence of that relationship is relevant and admissible. It is relevant because it provides an important part of the context within which the events are said to have occurred, and without which the complainant's evidence 164 (1998) 194 CLR 106 at 112-113 [11]-[12]; [1998] HCA 21; cf KRM v The Queen (2001) 206 CLR 221 at 231-233 [27]-[31] per McHugh J. 165 (1998) 194 CLR 106 at 112 [11]. 166 (1998) 194 CLR 106 at 113 [12]. Hayne would be incomplete. And at least in cases where the complainant alleges that the accused sexually assaulted the complainant before the events giving rise to the charges, the account of what happened on the charged occasions would be incomplete without relating what had gone before. But describing the evidence of other events as simply providing a factual "context" for, or "completing", the complainant's evidence about events that are charged may suggest that the evidence of other events lies only at the fringes of relevance, or that it is admitted as some exception to evidentiary rules that seek to limit the agitation of collateral issues167. That is not right. The evidence of other conduct and events is tendered as circumstantial evidence of the kind described by Dixon J in Martin v Osborne168. That is, "[t]he circumstances which may be taken into account in this process of reasoning include all facts and matters which form constituent parts or ingredients of the transaction itself or explain or make intelligible the course of conduct pursued"169. And it is because it is circumstantial evidence of that kind that the test in Pfennig is to be applied. The evidence of other events and conduct is tendered in proof of the charged acts. Circularity The appellant submitted that to use the complainant's evidence of conduct, other than the conduct that was charged, as evidence of the appellant's sexual attraction towards the complainant would "inappropriately [elevate] one part of the complainant's testimony in support of an inference of guilt when that part has no higher status [than] the other evidence it seeks to prove true". There was, so it was submitted, "a circular reliability" in which the evidence of other acts "relies on itself for support, and on nothing else". It is right to observe that the evidence of the offences charged and the evidence of the appellant's other conduct all came from the complainant. It by no means follows, however, that the jury are invited to adopt circular reasoning. The jury must be told that they may accept parts of a witness's evidence and reject other parts. Some evidence of a witness may be found to be inaccurate because it is exaggerated; other evidence of the same witness may be found not to suffer from that or any other relevant defect. 167 Attorney-General v Hitchcock (1847) 1 Ex 91 at 105-106 per Rolfe B [154 ER 38 168 (1936) 55 CLR 367 at 375. 169 (1936) 55 CLR 367 at 375. Hayne It was not essential for the jury to be persuaded of the complainant's account of other events before accepting her account of the events charged. It may well be that rejecting the account of other events would be regarded as putting in doubt the reliability of the account of the charged events. But that is a question for the jury to decide. Neither the existence of this possible differentiation between parts of the complainant's evidence nor the prosecution's invitation to accept the whole of her evidence bears upon either the relevance or admissibility of the evidence. A relevant statutory provision? In the course of the oral argument of the appeal to this Court, reference was made to s 34I of the Evidence Act 1929 (SA). That section provided, so far as now relevant, that: In proceedings in which a person is charged with a sexual offence, no question shall be asked or evidence admitted— except with the leave of the judge, as to the alleged victim's sexual activities before or after the events of and surrounding the alleged offence (other than recent sexual activities with the accused). In deciding whether leave should be granted under subsection (1)(b), the judge shall give effect to the principle that alleged victims of sexual offences should not be subjected to unnecessary distress, humiliation or embarrassment through the asking of questions or admission of evidence of the kind referred to in that subsection and shall not grant leave unless satisfied that the evidence in respect of which leave is sought— is of substantial probative value; and that its admission is required in the interests of justice." No reference was made to this section in the proceedings at first instance, or on appeal to the Full Court. There having been no objection at trial to reception of the complainant's evidence of other sexual acts by the appellant, on the basis that this section was engaged, it is now too late to raise the matter as a ground of appeal and the appellant did not seek to do so. It is, therefore, not necessary to decide whether s 34I may be engaged in relation to evidence of the kind in issue in this appeal. It may be observed, Hayne however, that if that provision is engaged, satisfaction of the test in Pfennig would likely provide a basis for concluding that the evidence of other sexual acts "is of substantial probative value" (s 34I(2)(a)) and that to ask the complainant about those acts would not subject him or her to unnecessary distress, humiliation or embarrassment. No charges in Victoria? For the reasons given earlier, apart from the evidence about the underwear, the complainant's evidence of other sexual conduct towards her was relevant and admissible in proof of the charged offences. Much of that evidence related to events in Victoria. And evidence was given at trial by a Detective Senior Constable of Victoria Police who had investigated those events of an interview he had conducted with the appellant. During the pre-trial hearing about admissibility of evidence, trial counsel for the appellant had submitted to the trial judge that he should be permitted to ask the Victoria Police officer whether charges had been laid in Victoria and elicit evidence that no charges had been laid. The trial judge ruled that that evidence, if given, would not be relevant and that to ask the question would encourage the jury to speculate. The appellant submitted, in this Court, that the trial judge's ruling was the wrong decision of a question of law. Evidence that no charges had been laid in Victoria was not relevant to any issue in the case. If given, that evidence made it neither more nor less probable that the Victorian events described by the complainant had occurred. As the trial judge's reference to speculation suggests, significance could be attached to the absence of charges only if it was known why charges had not been laid. A collateral inquiry of that kind was irrelevant. Jury directions The appellant's complaints in this Court about the directions given at trial centred upon two distinct aspects of the directions: first, what the jury were told about conduct in Victoria that had been investigated by Victoria Police; and, secondly, the directions given about the uses to which evidence of other sexual conduct could be put. The trial judge told the jury that the prosecution case depended entirely upon the evidence of the complainant and that there was no other evidence to support her evidence. Accordingly, he told the jury to "examine her evidence with careful scrutiny". Having described the evidence of "the sexual activity which is alleged by [the complainant], but which is not the subject of any separate counts on the information", the trial judge told the jury that all of those acts were said to have occurred in Victoria. His Honour went on to say that the Hayne jury knew "that these Victorian offences were investigated, but you do not know the outcome of that investigation" and that: "You must not speculate about what that outcome may have been. Whatever may have occurred in Victoria, if, indeed, anything did, cannot in any way help you here. You must decide this matter on the evidence which you have heard and seen in this courtroom during this trial. Nothing from outside it may be used to decide if the onus of proof has been discharged. Any such information is not relevant, as it cannot be helpful to you in that task." The appellant contended, in this Court, that this direction was inadequate. That contention should be rejected. Once it was decided (correctly) that evidence showing that no charges had been laid in Victoria was irrelevant, there was nothing more that could be said to the jury than was said here. Jury directions – other sexual events – standard of proof The trial judge went on to discuss the evidence of other sexual events in a way which reflected what trial counsel for the prosecution had said to the jury about that subject when opening the case. And as pointed out earlier, that treatment of the subject owed much to what had been said in Nieterink170. Thus the trial judge told the jury that the evidence was led by the prosecution "so that you may have an understanding of what is said to have been the relationship between the accused and [the complainant] when the visit to Adelaide was undertaken"; that "[t]he further use of the evidence" was that it may show why it was that the appellant "was confident enough to ask for oral sex and then to penetrate [the complainant] in Adelaide"; that it may also show "why she acquiesced in Adelaide"; that it may also indicate that "both before and after the visit to Adelaide the [appellant] had an ongoing sexual attraction to [the complainant] and sought gratification for that attraction by his conduct"; and finally "that this inappropriate behaviour continued late into 2002 may go some way to explain why there was no earlier complaint". The trial judge then said: "I direct you that you may not act upon the evidence of the uncharged acts unless and until you are satisfied as to it. Only then, if so satisfied of the truth of it, or of any part of it, may you use that evidence of which you are so satisfied when you consider the credibility of [the complainant] in relation to each count on the information and whether you are satisfied beyond reasonable doubt that either or both of them occurred. 170 (1999) 76 SASR 56 at 72 [76]. Hayne I must also tell you how you cannot use this evidence. You must not use this evidence, if you are satisfied about it, or any part of it, to reason that because of it the [appellant] is the type of person likely to have committed these offences. To so reason would be wrong and you must not do it. The fact that allegations are made about a number of occasions does not absolve you from the task of determining whether the charges themselves are made out. If you accept any of the evidence concerning the uncharged acts you may use that evidence when you consider [the complainant's] evidence as to the charges on the information and whether you are prepared to accept that evidence or any part of it." The appellant submitted that the directions just set out (the "other sexual conduct directions") were inadequate because the jury were not told what degree of satisfaction had to be reached. But at an earlier point in his directions the trial judge had said to the jury that: "If, in what I am about to say to you, I speak of matters being proved to your satisfaction, or if I use words like 'proved' or 'satisfied' or 'established' or 'accepted' or any other sort of word, what I always mean is proved beyond reasonable doubt." Given that this particular instruction was given as part of the general directions given to the jury about burden and standard of proof there is no basis for thinking that what was said was not impressed on the minds of the jury. That being so the particular complaint made about the other sexual conduct directions, that the jury were not told not to act upon the evidence of other sexual conduct unless satisfied of it beyond reasonable doubt, was not made good. It is important, however, to go on to consider the respondent's submission that the direction was unduly favourable to the appellant because proof beyond reasonable doubt of other sexual conduct was not necessary. In this respect the respondent placed considerable emphasis upon what was said in Shepherd v The Queen171 and the distinction drawn in that case172 between intermediate facts which are an indispensable step upon the way to an inference of guilt, and inferences drawn from a combination of facts, none of which viewed alone would support the inference. 171 (1990) 170 CLR 573; [1990] HCA 56. 172 (1990) 170 CLR 573 at 581 per Dawson J. Hayne It was pointed out in Pfennig173 that the purpose of evidence of other discreditable or criminal conduct that is admitted at trial is to establish a step in the proof of the prosecution case; if the evidence is not capable of doing that, it is to be rejected as inadmissible. Because this is the basis for admitting the evidence (that the jury may use it as a step towards inferring guilt) the jury may use it in that way only if persuaded of its truth beyond reasonable doubt. The direction in this case about what standard of proof was to be applied was correct. Jury directions – the use of evidence of other sexual events It will be recalled that the trial judge concluded the other sexual conduct directions by speaking of the jury "act[ing] upon the evidence" of the other sexual events, and "us[ing] that evidence of which you are so satisfied when you consider the credibility of [the complainant] in relation to each count on the information". This direction picked up only some of the possible uses that the trial judge had told the jury that the prosecution sought to make of the evidence. It would have been understood as picking up those uses that were described earlier in these reasons as context, confidence to offend, and the absence of early complaint. The other sexual conduct directions did not refer, however, to the prosecution's contention that the other events demonstrated not only "an ongoing sexual attraction" to the complainant but also the willingness to give effect to that desire by conduct. Yet it is those conclusions that would found a step in the reasoning towards guilt of the charged offences and it was the availability of those conclusions that founded the admissibility of the evidence. Of course, the jury's assessment of the credibility of the complainant's evidence would have to take account of all of her testimony. The matters to which the judge pointed were arguments that were open to be made about the assessment of her credibility and they were arguments that had been made by the prosecution. But the central points to be addressed in the directions about other sexual events were how the evidence might and might not properly be used in determining whether the offences charged had been proved beyond reasonable doubt. This the directions did not do. As will be apparent from what has been said already, the directions about how the evidence of other sexual conduct and events might properly be used should have focused upon whether the evidence established, beyond reasonable doubt, that the appellant had a sexual interest in the complainant and had given effect to that desire by his actions. The manner of expressing that direction will, of course, depend upon the way the case has proceeded. In particular, the way in 173 (1995) 182 CLR 461 at 483. Hayne which the accused's sexual interest is described may depend upon the ways in which the parties have chosen to describe it. Words like "passion", "desire" or "attraction" have often been used to describe what moves the accused in a case like those now under consideration. Sometimes epithets like "guilty" or "illicit" or "unnatural" have been used to embellish the description. There is no one formula which must be used. As a general rule the use of embellishing epithets is neither helpful nor desirable. What is important is that the jury's attention is focused upon whether the evidence of other sexual conduct or events proves the accused had a sexual interest in the complainant and had carried that interest into effect. Jury directions – a miscarriage of justice? In the particular context of this case, the failure to give the jury a direction about how the evidence might be used as a step towards reasoning to a guilty verdict did not establish the ground of appeal described in the common form criminal appeal provisions174 as "on any ground there was a miscarriage of justice". The omission of this direction occasioned no miscarriage of justice for two reasons. First, the jury were directed that they might act upon the evidence of other sexual conduct and events only if satisfied of that evidence beyond reasonable doubt. Second, the jury were directed that "if so satisfied of the truth of it, or of any part of it" they were not "to reason that because of it the [appellant] is the type of person likely to have committed these offences". This latter direction was evidently intended to guard against any form of propensity reasoning. As is apparent from what has been said earlier in these reasons, that was a direction that took away from the jury the consideration of that chain of reasoning identified in Pfennig as the basis for admission of evidence of this kind. But the chain of reasoning which the jury were forbidden to consider was reasoning towards guilt. That being so, the directions, taken as a whole, occasioned no miscarriage of justice. No ground of appeal being established, no question about the application of the proviso need be considered. The appeal should be dismissed. SB v The Queen SB was charged in the District Court of South Australia with three counts of indecent assault and two counts of incest. The offences were alleged to have occurred in 1983 and 1986. The first count, of indecent assault, identified the date of the offence as between 1 January 1983 and 31 December 1983. Two 174 Criminal Law Consolidation Act 1935 (SA), s 353(1). Hayne other counts of indecent assault, and one count of incest, were alleged to have occurred between 11 October 1983 and 17 October 1983. The last count, of incest, was alleged to have occurred between 1 October 1986 and 31 December 1986. The complainant was the appellant's daughter. The appellant pleaded not guilty to all counts but, after deliberating for about five hours, the jury, by majority, returned verdicts of guilty to all five counts. The appellant appealed to the Full Court of the Supreme Court of South Australia against his convictions. Six grounds of appeal were advanced, all relating to the judge's directions to the jury. The Full Court (Duggan, Sulan and David JJ) dismissed175 the appeal. By special leave, the appellant appeals to this Court on the single ground that the Full Court erred "in not considering that the directions given by the trial Judge concerning the evidence of uncharged acts were inadequate". In the course of the hearing of the appeal to this Court, the appellant sought leave to amend his notice of appeal by adding grounds alleging that the Full Court erred in failing to find that "all or some of the evidence of the uncharged acts" was either inadmissible or "not admissible on any or all of the various bases adverted to by the Prosecutor". No objection was taken at trial to the reception of any of the evidence which it is now sought to say should not have been admitted. It is only in an exceptional case that this Court will give special leave to appeal from a decision of a Court of Criminal Appeal affirming a conviction when the point the applicant seeks to raise was not taken either at trial or in the Court of Criminal Appeal176. This is not such a case. The prosecution case In opening the case to the jury, trial counsel for the prosecution told the jury that it was alleged that the appellant had "started to sexually abuse [the complainant], when she was in her first year at high school". Counsel said that the first incident that the complainant could recall was after dinner one night when the appellant exposed himself to her after he had had a shower. Counsel said that the appellant "did this to her on a number of occasions". Counsel went on to say that the appellant started to have the complainant help him at night on the rural property where they were living, going outside to check on the animals and put things away. Counsel continued: 175 R v S, B [2006] SASC 319. 176 Giannarelli v The Queen (1983) 154 CLR 212; [1983] HCA 41; Crampton v The Queen (2000) 206 CLR 161; [2000] HCA 60. Hayne "It was whilst they were doing the rounds around the house, that he first started to touch her and to kiss her. He started to kiss her on the lips and from there it progressed to touching, firstly on the outside of her clothing, and then underneath her clothing, in the area of her breasts and her vagina. The Crown alleges that he was, in fact, grooming her for what was to come later; that he was getting her ready for the sexual advances that he was to make to her at a later time." Counsel then told the jury what evidence it was expected that the complainant would give of the particular events giving rise to the charges against the appellant. In addition, however, trial counsel for the prosecution told the jury that the complainant would say that after the commission of the first offence charged (an offence of indecent assault) the appellant had given her a dildo and told her that "she should start to use it". It follows that in this case (like HML) the evidence of so-called "uncharged acts" was evidence of sexual conduct by the appellant directed at the complainant which in some respects was criminal, but others not. All of the evidence of the events other than those charged was, however, discreditable to the appellant. The relevance asserted at trial After the evidence in the case was complete, the trial judge asked trial counsel for the prosecution what she would say to the jury about the relevance of the complainant's evidence of other conduct of the appellant. Counsel said that the other events "put the sexual activities in context; that they provide the starting point for the sexual contact that unfolds from there and without using the particular word of 'grooming' ... they are precursors to what comes later and put in context the behaviour that comes later". The trial judge responded by telling counsel that he would tell the jury that "they are not to rationalise from that evidence anything that would suggest that [the appellant is] guilty of the other offences, or that the [appellant] is the sort of person who would commit these offences" (emphasis added). Jury directions Ultimately, the trial judge directed the jury that the "evidence of other alleged criminal conduct" was "potentially helpful to you in evaluating [the complainant's] evidence". It might "better enable" the jury to assess her evidence. "The whole of the alleged course of events provides a context in which it is said that the charged acts occurred." Hayne The trial judge told the jury that the prosecution presented the evidence as "explaining the background against which the first offence charged came about" and the other offences which are alleged to have followed where the complainant's evidence "may otherwise appear to be unreal or not fully comprehensible". The trial judge concluded this section of the directions in the following terms: "Now, those two discrete matters which I have mentioned are the only ways in which you are permitted to use the evidence of the uncharged acts which were stated by [the complainant] in her evidence. Having directed you on the permissible manner in which you may use the evidence, I now turn to direct you on how you cannot use the evidence. If you find proved that the [appellant] was involved in any of the uncharged acts I have already described, you must not reason that the [appellant] must have committed any of the sexual acts, the subject of the charges in the Information. That would be totally wrong. Such reasoning is not permissible. Furthermore, it would be wrong to conclude, if you find proved that the [appellant] engaged in any of the uncharged acts related by [the complainant] in her evidence, that the [appellant] is the sort of person who would be likely to commit the offences for which he is charged. Remember, it is the evidence presented in proof of each of the charges, which is the critical evidence in this Trial. The evidence of the uncharged acts has only been presented for the purpose of the permissible uses to which I have referred. Of course, the first step in the process is to determine whether you are satisfied that any of the uncharged acts have been proved before you can use any of them in the permitted ways I have described. I will, again, refer to this evidence, and what you should do in the course of evaluating it shortly." (emphasis added) As foreshadowed, the trial judge returned to the subject of "uncharged acts". He warned the jury of the need to scrutinise the complainant's evidence about these events with great care and that "it would be dangerous to act upon her evidence of any of the uncharged acts unless, bearing in mind the warning I have given you, you are satisfied of the truth and accuracy of the evidence". (At an earlier point in the directions, the trial judge had told the jury that when he spoke of the jury being "satisfied of something in respect of the Crown case" he meant "proof or satisfaction beyond reasonable doubt".) Taken as a whole, the trial judge's directions to the jury confined the jury's consideration of conduct and events other than those charged to using it for "evaluating" the complainant's evidence. The jury were directed that they could Hayne not use the evidence of other conduct and events to "reason that the [appellant] must have committed any of the sexual acts, the subject of the charges in the Information" or that he was "the sort of person who would be likely to commit the offences for which he is charged" (emphasis added). The effect of the directions By confining the jury's use of the evidence in this way, the trial judge denied the jury's use of it for purposes for which the evidence was both relevant and admissible in support of the prosecution case. In particular, the directions precluded the jury using the evidence of other conduct and events as circumstantial evidence which, if established beyond reasonable doubt, could be used as a step in the proof of commission of the charged acts. It may greatly be doubted that telling the jury that the evidence of other conduct and events might be helpful in "evaluating" the complainant's evidence provided any useful assistance or guidance to the jury. It neither identified any issue in the case nor told the jury what law they needed to know to resolve that issue. It may equally be doubted that telling the jury that the evidence explained the "background against which the first offence charged came about" told the jury anything that was not apparent from the evidence itself. But in assessing whether the directions occasioned any miscarriage of justice, chief weight must be given to the strength of the negative directions given by the trial judge. The directions about how the jury could not use the evidence require the conclusion that the uncertainties and ambiguities inherent in the directions about "evaluating" the complainant's evidence and providing "background" to the charged offences occasioned no miscarriage of justice. No ground of appeal being established, no question about the application of the proviso need be considered in this case. The appeal should be dismissed. OAE v The Queen OAE was charged in the District Court of South Australia with one count of indecent assault and one count of rape. A count of unlawful sexual intercourse contrary to s 49(3) of the Criminal Law Consolidation Act was charged as an alternative to the count of rape. The count of indecent assault was alleged to have occurred in 1999, when the complainant was aged 12. The count of rape, and the alternative count of unlawful sexual intercourse, alleged that the applicant had digitally penetrated the complainant when she was aged 16. The Hayne offence of digital penetration was alleged to have occurred between May and August 2003. At the time of the alleged offences, the complainant lived with her foster mother, a sister of the applicant. The complainant's foster mother and the applicant lived in separate houses on the same rural property. The applicant was a horse trainer and, at the times of the alleged offences, the complainant worked with the horses and around the stables. The disputed evidence The prosecution case at trial was that the charge of indecent assault was the first in a series of sexual assaults by the applicant on the complainant and that the alleged digital penetration in 2003 was the last of that series. Trial counsel for the applicant objected to the reception of any evidence of sexual conduct alleged to have occurred in the intervening period. Trial counsel for the prosecution submitted that, if the jury did not hear evidence of a history of sexual misconduct between the alleged indecent assault in 1999 and the incident of digital penetration in 2003, they would be left with the impression that the 2003 incident happened out of the blue. The trial judge ruled that the evidence was admissible holding first, that the evidence was more probative than prejudicial, secondly, that it was relevant to show the nature of the relationship between the applicant and the complainant, and thirdly, that it was relevant to show that the counts alleging events in 2003 "did not happen out of the blue". Whether, as trial counsel for the prosecution then urged, the evidence was also admissible for the purpose of showing "sexual attraction" or "sexual passion" was left for further debate in light of the complainant's evidence. The complainant's evidence of other sexual conduct was not precise. So, for example, when speaking about other occasions when the applicant had touched her, the complainant said "[i]t happened quite often and, yes, it all just kind of blurred into one". She said that the conduct she described occurred "[e]very couple of days" and that "[i]t basically continued, continued right up until I left when I was between 13 and 15". And although the complainant's evidence in relation to the events which were the subject of the charges against the applicant was more precise, her evidence of other sexual misconduct was given at a level of generality which could admit of no more precise answer than bare denial. So, for example, when asked whether the particular event of digital penetration which founded the alternative charges of rape or unlawful sexual intercourse "was the first time he'd ever done the act of inserting his fingers into your vagina", the complainant said that it was not the first time, that he had previously done it "[q]uite a few times", that she had "lost count" of the number of times he had done it, and that he may have done it "40, 50 times between from when I was 12 until I was 16". Hayne The decision below The jury returned a verdict of not guilty on count 1, the count of indecent assault, but a verdict of guilty on count 2, the count of rape. The applicant appealed to the Full Court of the Supreme Court of South Australia against his conviction. He submitted that the evidence of other sexual misconduct should not have been admitted and alleged that the trial judge should have directed the jury, but did not, that they could use the evidence of other sexual misconduct only if satisfied beyond reasonable doubt that those acts had occurred. By majority (Doyle CJ and Layton J; Debelle J dissenting) the Full Court dismissed177 the appeal. All members of the Court agreed that the evidence of other sexual misconduct was admissible, but the Court divided about whether the directions to the jury would have been understood as requiring them to be satisfied of the occurrence of the other sexual misconduct beyond reasonable doubt before using that evidence. Further, Doyle CJ, with whose reasons Layton J agreed, said178 that "[i]t was not necessary for the Judge to direct the jury that they had to be satisfied beyond reasonable doubt of the course of conduct constituted by the uncharged acts". His Honour went on to say179, however, that: "It has been accepted in other cases that evidence of uncharged acts, evidence of the kind and quality led here, and for the purpose relied upon here, need not support a conclusion beyond reasonable doubt before it can be used. But the safer course is for the judge to tell the jury that they should be satisfied of the truth of the evidence, or something like that, even though that will suggest to the jury that this means satisfaction beyond reasonable doubt: see Nieterink180, R v Kostaras181 and R v Sciberras182. That avoids introducing the complication of differing standards of proof." 177 R v O, AE (2007) 172 A Crim R 100. 178 (2007) 172 A Crim R 100 at 108 [33]. 179 (2007) 172 A Crim R 100 at 108 [34]. 180 (1999) 76 SASR 56 at 72-73 [83]. 181 (2002) 133 A Crim R 399 at 407 [51]. 182 (2003) 226 LSJS 473 at 482 [39]. Hayne By contrast, Debelle J was of the view183 "that where evidence of uncharged acts consists of allegations of repeated sexual misconduct which is so intertwined with the charged acts, the trial judge must direct the jury that they must be satisfied that the uncharged acts have been proved beyond reasonable doubt. In the particular circumstances of this case, it would have been sufficient if the jury was satisfied beyond reasonable doubt that the [applicant] had a sexual attraction for the complainant." The applicant now seeks special leave to appeal to this Court. The application for special leave was referred for argument as on appeal, at the same time as the argument of the appeals in HML and SB. Admissibility The applicant's submission that the complainant's evidence of other sexual misconduct by the applicant in the period between the two events charged should not have been received should be rejected. As explained earlier in these reasons, evidence of other sexual misconduct was both relevant and admissible. Further, although the generality of the evidence to be given by the complainant was said, at first instance, to require close attention to whether the prejudicial effect of the evidence outweighed its probative value, it is not shown that the trial judge erred in rejecting the applicant's contention to that effect. An accused person faced with evidence of the generality which the complainant in this case gave about other sexual misconduct by the applicant is unable to meet the allegations with more than a bare denial. But when balancing probative value and prejudicial effect it is important to recognise the limits of the probative value of evidence when it is given at the level of generality of the evidence given by the complainant in this case. Her evidence was that the applicant had interfered with her sexually many times. She described what forms that interference took. She did not say that she could identify when these events occurred, and she did not say that she could give any accurate estimate of how often these events occurred. By contrast, she did give more particular evidence about the events that founded the charges preferred against the applicant. If the complainant's evidence of other sexual events and conduct was wholly accepted, it would show that the applicant had committed serious offences against her very many times. Those other offences were of the same kind as those for which the applicant was being tried. As explained earlier in these reasons, the frequency of commission of that other conduct would bear 183 (2007) 172 A Crim R 100 at 108 [38]. Hayne upon the likelihood of the applicant having committed the charged offences. Thus, if the complainant's evidence about other conduct was accepted, it could have constituted a step in reasoning towards guilt, there being no reasonable view of it which would be consistent with innocence. But it would be a step where it would be the probative value of the evidence that worked a disadvantage to the applicant. Its admission would work no prejudice to the applicant over and above what the evidence established. But in this case, these considerations must be put aside because of the directions the trial judge gave the jury. The impugned directions The trial judge told the jury that it would be wrong to use the evidence of other sexual misconduct "as establishing a propensity or tendency on the part of the [applicant] to commit the charged offences". He went on to say: "That does not mean that the evidence of the uncharged acts is irrelevant. The evidence is relevant. On the prosecution case, the uncharged acts show the nature of the relationship which existed between the [applicant] and [the complainant] during the four years leading up to the feed shed incident, which is the subject of the second and third counts. Without that evidence – without the evidence relating to the uncharged acts – the circumstances of the feed shed incident might appear quite artificial or unrealistic. It would have appeared that after committing the first offence the [applicant] – on the Crown case – did not sexually interfere with [the complainant] for another four years, though she attended his home on a daily basis. Putting it another way, it would have looked as if the feed shed incident had happened out of the blue, so to speak. So that is the permissible use to be made of the uncharged acts, ladies and gentlemen. The evidence is relevant to put the charged offences, and in particular counts 2 and 3, in their proper context, but that is the only legitimate use to be made of this evidence. I repeat, it would be wrong for you to reason – and you must not reason – that the [applicant] must be guilty of the charged acts simply because you happen to be satisfied that he committed one or more of the uncharged acts." The trial judge had, at an earlier stage in his directions, told the jury that if, in the course of the summing-up, he spoke of matters being "proved or being established to your satisfaction" then the jury were to understand that he always meant proof beyond reasonable doubt. But as Debelle J rightly pointed out in the Hayne Full Court184, "[t]his part of the direction contained no reference of any kind to the standard of proof of the uncharged acts". Rather, the trial judge told the jury that they could not reason in a particular way if satisfied that the applicant had committed "one or more of the uncharged acts"; the trial judge nowhere told the jury that the use he had identified as permitted was a use that could be made only if the jury were satisfied beyond reasonable doubt of some conclusion drawn from that evidence. It will be recalled that the trial judge told the jury that there was only one permissible use to which "the evidence relating to the uncharged acts" could be put – "to put the charged offences, and in particular counts 2 and 3, in their proper context". All other uses of the evidence were prohibited. In particular, the jury were told not to reason "that the [applicant] must be guilty of the charged acts simply because you happen to be satisfied that he committed one or more of the uncharged acts". In the particular circumstance of this case, it was not appropriate to deal with the complainant's evidence of other sexual misconduct on the footing that it disclosed the commission of identified, separate, acts. It did not. References to "one or more of the uncharged acts" were, therefore, inappropriate. Although use of the evidence of other sexual misconduct as showing sexual interest or attraction was mentioned after the pre-trial ruling about admissibility the point was not further agitated at the trial. Rather, as the passages quoted earlier from the trial judge's directions reveal, the evidence of other sexual misconduct was treated as going only to put the charged offences "in context". To say that the evidence of other conduct may be used to put the charged offences "in context" masks a fundamental ambiguity. The ambiguity is revealed by considering how a direction about the standard of proof of that other conduct would be framed. The generality of the complainant's evidence of other sexual misconduct made it difficult to frame a direction about the standard of proof. To speak, in only general terms, of the evidence that the complainant had given about other conduct would not specify sufficiently what conclusion the jury were being invited to consider. But the "context" that the other conduct could provide was to provide evidence of the applicant's sexual interest in the complainant and his willingness to give effect to that interest by doing one or more of the acts described by the complainant. And if that was the way the evidence of other conduct was to be used, the jury had to be satisfied beyond reasonable doubt that 184 (2007) 172 A Crim R 100 at 109 [39]. Hayne the evidence of the other conduct proved the applicant's sexual interest in the complainant and his willingness to give effect to it in the ways described by the complainant. That is why, in his reasons, Debelle J correctly spoke185 of the allegations of other sexual misconduct as being so "intertwined" with the charged acts as to require a direction that the jury not act on the evidence of other sexual misconduct unless satisfied of it beyond reasonable doubt. As appears from what has been said earlier in these reasons, evidence of sexual conduct other than the offences charged is a form of circumstantial evidence. Because its relevance lies in the identity of the parties concerned in both the charged and the other conduct, it is inevitable that all of the evidence is "intertwined", at least to that extent. But evidence of other sexual conduct is not to be divided into categories according to the nature or extent of that intertwining. The evidence may not be admitted unless it meets the test in Pfennig. If it meets the test in Pfennig, it may, but need not, be used by the jury as a step in reasoning towards guilt. If it is used by the jury as a step in reasoning towards guilt, the jury must be satisfied beyond reasonable doubt of the premise for that chain of reasoning. As explained earlier, the premise for such reasoning will usually have to be spelled out in terms of demonstrated sexual interest and demonstrated desire or willingness to use the complainant as the object of gratification of that interest. The directions given in this case were deficient. It is not possible to say by reference only to the written record of the trial that the deficiency caused no substantial miscarriage of justice. Without seeing and hearing the witnesses it is not possible for an appellate court to conclude that the evidence adduced at the applicant's trial proved his guilt of the offences charged beyond reasonable doubt186. The application for special leave should be granted, and the appeal treated as instituted and heard instanter and allowed. The orders of the Full Court of the Supreme Court of South Australia should be set aside and in their place there should be orders that (a) the appeal to that Court is allowed, (b) the convictions quashed and (c) a new trial had. 185 (2007) 172 A Crim R 100 at 108 [38]. 186 Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81. Hayne Conclusion Although all members of the Court agree that evidence of other sexual conduct that has taken place between an accused and the complainant is relevant, the Court is divided in opinion about further questions that I consider then arise. The reasons of each member of the Court must be read as a whole. It is not appropriate for me to attempt to summarise the effect of the Court's reasons. It is important to recognise, however, that at least a majority of the Court187 is of the opinion that "[i]n the ordinary course a jury would be instructed by the trial judge that they must only find that the accused has a sexual interest in the complainant if it is proved beyond reasonable doubt"188. 187 Gummow J at [41], Kirby J at [63], Kiefel J at [506] and these reasons at [132]. 188 Kiefel J at [506]. 248 HEYDON J. Before the Court are two appeals and an application for special leave to appeal. They relate to a field of controversy marked out by the overlap between two non-identical areas: "evidence of uncharged acts" and "relationship evidence"189. Each of the accused persons was a mature man who was convicted of sexual crimes against a young female relative after a jury trial in the District Court of South Australia. Each challenges an order of the Court of Criminal Appeal of South Australia dismissing his appeal against conviction. Counsel for each of the accused persons exposed some difficulties in the reasoning of the courts below. However, while special leave should be granted, the appeals must be dismissed for the following reasons. HML v The Queen: the background HML and his wife had a daughter on 21 July 1990, but separated while the daughter was still a baby. HML and his daughter then lost contact. The mother and daughter lived in Mount Gambier, South Australia. After some years, HML came to live in Drik Drik, Victoria, which can be reached from Mount Gambier by car in about 45 minutes. From time to time the daughter visited HML at Drik Drik on access visits. HML v The Queen: the trial HML was charged with two counts of unlawful sexual intercourse with his daughter, a person under the age of 12 years, contrary to s 49(1) of the Criminal Law Consolidation Act 1935 (SA). Each offence was alleged to have occurred between 27 September and 4 October 1999. The daughter was then aged nine. The offences were alleged to have occurred during a visit HML was undertaking to Adelaide for the purpose of eye surgery. The first count charged fellatio and the second anal intercourse. The daughter alleged that on the morning on which the eye surgery was to take place, HML and his daughter were in their shared bedroom after breakfast. She said she wanted to have a look around and go shopping. He said that he would comply with her wishes if she carried out fellatio on him. She complied briefly, twice. On the morning of the following day, he had anal intercourse with her briefly. He then said: "Why isn't it 189 The expression "relationship" normally connotes reciprocity and mutuality. From that point of view a state of affairs existing between a child and a much older relative or acquaintance which centres on unsolicited, unencouraged and unwanted sexual overtures by the latter towards the former is not very aptly called "a relationship". The expression "uncharged acts evidence" is used below, although it has applications wider than the type of circumstance described above, for it can apply to conduct taking place between a defendant and a person other than the witness proving the charged acts. working? It's worked before." She testified that she knew what he meant by that, because he had done it to her before. During 2003 the daughter's allegations came to the attention of the police. On 21 August 2003, HML was questioned at Mount Gambier by a Victorian detective and a South Australian detective about those allegations. Later that day the Victorian detective questioned him about other sexual incidents which allegedly took place in Victoria, some before and some after the alleged offences in Adelaide. HML has never been charged in relation to the conduct alleged in Victoria, and it will be described as "the uncharged acts". On 22 March 2006, after a trial presided over by Judge Anderson, a jury convicted HML on both counts. The daughter was then aged 15. An objection to her evidence about the uncharged acts was rejected by the trial judge. HML v The Queen: the Court of Criminal Appeal An appeal by HML to the Court of Criminal Appeal (Nyland, Vanstone and White JJ) was dismissed190. HML took no point about the admissibility of the uncharged acts. He did complain that the trial judge erred in rejecting evidence that no charges had been laid in Victoria about the uncharged acts, leaving open the possibility that HML had been convicted of the uncharged acts. He also complained that the judge failed to direct the jury that they should not find that the uncharged acts had been committed unless satisfied beyond reasonable doubt. HML v The Queen: the appeal to this Court In this Court HML contended, in addition, that the jury had been inadequately directed about the uses to which the evidence of uncharged acts could be put. He also sought leave to amend the notice of appeal to challenge the admissibility of the uncharged acts. It is logical to begin with the last question. HML v The Queen: admissibility of the uncharged acts: their nature Before the trial commenced counsel for HML applied for an order excluding evidence of the uncharged acts. Those uncharged acts were described in three statements by the daughter (dated 31 July 2003, 28 February 2006 and 10 March 2006), a statement by a female friend of the daughter (dated 30 August 2003) and a statement by a male friend of the daughter (dated 3 September 2003). The daughter had made complaints about her father's conduct to each of these friends. The debate about admissibility before the trial 190 R v H, ML [2006] SASC 240. judge was conducted on the assumption that the daughter's evidence would correspond with the statements. The evidence she actually gave was somewhat more specific. Indeed HML submitted in this Court that even if the evidence were otherwise admissible, it had been given in unnecessary detail. The uncharged acts were of eight kinds. (a) At least before the Adelaide visit, HML would walk around his house naked for the majority of each day unless he was going outside to work. Both before and after the Adelaide visit, HML, on kissing his daughter goodnight, would try to insert his tongue into her mouth. Both before and after the Adelaide visit, HML placed one or two fingers in his daughter's vagina "regularly", "most mornings", "some mornings" and "more than once". (d) On one occasion, the time of which is not clear, HML offered his daughter a small toy to perform acrobatics and cartwheels naked, and filmed her doing this. Before the Adelaide visit, and once or perhaps twice after it, HML had anal intercourse with his daughter. On one occasion after the Adelaide visit, HML penetrated his daughter's vagina with his penis. (g) After the Adelaide visit, HML performed an act of cunnilingus on his daughter. Either before or after the Adelaide visit, HML offered to buy for his daughter items of "the type of underwear known as G-strings", bought three of them and gave them to her. To call all of this conduct "uncharged acts" could be a misnomer, because HML contended that incidents (a), (d) and (h) were not necessarily crimes. HML gave evidence. Although this does not affect the admissibility of the uncharged acts evidence, he denied all of it, save that he admitted he occasionally went from his bedroom to the bathroom naked, and said that although he bought G-string underwear for his daughter, he did so at her request. HML v The Queen: admissibility of the uncharged acts: the problem Where a child complains of a long course of sexual abuse, and the authorities decide to prosecute, difficulties can arise. It may be impossible to draft charges covering all the abuse. "[A] defendant is entitled to be apprised not only of the legal nature of the offence with which he is charged but also of the particular act, matter or thing alleged as the foundation of the charge. The court hearing a complaint or information for an offence must have before it a means of identifying with the matter or transaction alleged in the document the matter or transaction appearing in evidence."191 The complainant may be incapable of differentiating each incident sufficiently to satisfy this test192. Even if it is possible to draft charges covering all the abuse, it may be undesirable to do so. It is therefore common to select only a relatively small number of incidents as the subject of charges. What is the status of those parts of the complainant's story which are not made the subject of charges? Are they admissible? If so, to establish what? How should the jury be directed? What is the standard of proof in relation to the uncharged acts? This appeal throws up difficulties of these kinds. They are difficulties which can be reduced where the legislature has created an offence of maintaining a sexual relationship with a child. Thus s 74 of the Criminal Law Consolidation Act 1935 (SA) provides in part193: "(1) A person may be charged with and convicted of the offence of persistent sexual abuse of a child. Persistent sexual abuse of a child consists of a course of conduct involving the commission of a sexual offence against a child on at least three separate occasions (whether the offence is of the same nature on each occasion or differs from occasion to occasion). (3) A person does not however commit the offence of persistent sexual abuse of a child unless the occasions on which a sexual offence is committed against the child fall on at least three days." 191 Johnson v Miller (1937) 59 CLR 467 at 489-490 per Dixon J; [1937] HCA 77. 192 See S v The Queen (1989) 168 CLR 266; [1989] HCA 66. 193 See also Crimes Act 1900 (NSW), s 66EA; Crimes Act 1958 (Vic), s 47A; Criminal Code (Q), s 229B; Criminal Code (WA), s 321A; Criminal Code (Tas), s 125A; Criminal Code (NT), s 131A; Crimes Act 1900 (ACT), s 56. However, this provision was not employed in relation to the complaints of the daughter in this case: there were only two acts which could be charged since the uncharged acts were not alleged to have taken place in South Australia. HML v The Queen: admissibility of the uncharged acts: pre-trial proceedings Counsel for HML objected to the uncharged acts evidence on the ground of irrelevance: that it did not legitimately explain any aspect of the evidence given about the Adelaide incidents. Counsel for the prosecution supported her tender of the uncharged acts evidence on the following grounds and in the following order. First, events occurring before the Adelaide incidents provided a "context" for those incidents. Without that context the unrealistic impression would be left that they "just occurred out of the blue". Secondly, events occurring before Adelaide explained why HML was "confident enough to ... offend" in Adelaide in the manner alleged. Thirdly, events occurring before Adelaide explained why the daughter "acquiesced" in HML's conduct in Adelaide. This was said to be the "flipside" of the second point, although strictly speaking it is not exactly so. Fourthly, the uncharged acts, both before and after Adelaide, were capable of demonstrating that HML had a "sexual attraction" for his daughter, and that this tended "to provide an explanation as to why it is that the offending in Adelaide may have occurred"194. Fifthly, counsel for the prosecution argued that the offending after Adelaide explained why the daughter did not make immediate complaint about the occurrence of the charged acts in Adelaide. 194 When supporting the tender of the evidence, counsel for the prosecution also said: "What I am not intending to lead evidence about is because of his sexual attraction the defendant is someone who is more likely than not to have committed the charges acts, that sort of propensity-type reasoning is not the basis upon which I say the evidence of sexual attraction is relevant." However, this qualification was omitted when counsel made her opening and closing speeches to the jury, and it was also omitted from the judge's summing up. The evidence was thus left to the jury as evidence demonstrating HML's disposition to gratify his sexual attraction for his daughter: cf [35], [455] and [515]. Sixthly, counsel for the prosecution submitted that the extent and duration of the conduct might explain any inability in the complainant to remember the dates and order of events. Counsel for HML dealt with the first five points by denying that there was anything which the uncharged acts could cast light on. He said of the sixth point that the uncertainties in the daughter's evidence related only to the uncharged acts, not the charged ones. This argument succeeded in the sense that neither prosecution counsel nor the trial judge thereafter said that the evidence could be used in the manner described in the sixth point. Counsel for HML also complained about the fact that the daughter's third statement, made in March 2006 just before the admissibility argument, had suddenly become more specific, to which the trial judge responded that that did not affect admissibility. The trial judge then held the evidence admissible. Apart from his interventions in argument, he gave no reasons for that conclusion. Although he was not asked to give reasons, it would have been desirable to do so if he thought that the evidence was admissible on some bases but not others, for that conclusion could have affected the conduct by counsel of the trial. But the trial judge's failure to give reasons is not advanced as a ground of appeal. And the trial appears to have been conducted largely195 on the assumption that the uncharged acts were admissible for the first five purposes described by prosecution counsel in opposing the objection. Those five purposes were described by prosecution counsel in her opening and closing addresses to the jury, and by the judge in summing up. Despite all this, as counsel for HML submitted in this Court, and as can commonly happen, the failure of the trial judge to give reasons may have caused him to fail properly to analyse the grounds for admitting or rejecting the evidence. HML v The Queen: admissibility of the uncharged acts: amendment application In this Court HML sought leave to amend his notice of appeal by adding a ground contending that the Court of Criminal Appeal erred in: "failing to find that the evidence of all or some of the uncharged acts was: 2.5.1 inadmissible; 2.5.2 in the alternative, not admissible on all of the various bases in her submissions on the prosecutor advanced by admissibility." 195 See n 194 above. Although the points underlying this ground were not taken in the Court of Criminal Appeal, the leave sought should be granted. The case does not fall within the area where an appeal will only exceptionally be entertained, namely where the points were not taken either at the trial or in the intermediate court of appeal196: the evidence which HML now says is inadmissible was objected to at trial, although most of the arguments now relied on were not put at that time. HML v The Queen: admissibility of the uncharged acts: the issues In assessing the admissibility of uncharged acts evidence, two primary issues arise. First, was the evidence relevant? Secondly, did any rule operate to render it inadmissible? A third issue which could arise is whether the evidence ought to have been excluded in the discretion of the court. HML v The Queen: admissibility of the uncharged acts: history For a long time, with few exceptions197, on a charge against an accused of committing a sexual crime against a particular victim, the courts have admitted evidence of uncharged sexual acts by the accused against that victim. Thus in 1861 in R v Jones198 evidence of uncharged rapes by a father of his daughter was admitted to establish a "reign of terror" causing the daughter not to resist. This idea is among those which have been employed more recently. Sometimes the evidence has been admitted independently of the principles regulating similar fact evidence199. At other times the evidence is said to be admitted in conformity with those principles200. 196 See Crampton v The Queen (2000) 206 CLR 161; [2000] HCA 60. 197 Eg R v Robinson (1909) 9 SR (NSW) 728; R v Herbert [1916] VLR 343; R v Organ [1925] St R Qd 95. These decisions have been disapproved: see R v Gellin (1913) 13 SR (NSW) 271; R v Allen [1937] St R Qd 32. 198 (1861) 4 LT 154. See also R v Rearden (1864) 4 F & F 76 at 80 [176 ER 473 at 199 Eg R v Whitehead (1897) 23 VLR 239 at 241. 200 See, for example, R v Horne (1903) 6 WAR 9; R v Stone (1910) 6 Cr App R 89 at 93-94; R v Ball [1911] AC 47; R v Gellin (1913) 13 SR (NSW) 271; R v Shellaker [1914] 1 KB 414; R v Rogan [1916] NZLR 265 at 291; R v Langdon [1920] NZLR 495; R v Parkin (1922) 37 CCC 35; R v Young [1923] SASR 35; R v Hewitt (1925) 19 Cr App R 64; R v Allen [1937] St R Qd 32; R v Power [1940] St R Qd 111; R v Hartley [1941] 1 KB 5; R v Witham [1962] Qd R 49; S v The Queen (1989) 168 CLR 266. HML v The Queen: admissibility of the uncharged acts: nature of sexual acts Although over the last 150 years, and particularly in the many relatively recent cases of this kind, other bases for the reception of uncharged sexual acts evidence have developed, one fundamental basis has been that the evidence proves sexual attraction which was acted on. That basis rests on the very high probative value of the evidence in the light of what are thought to be the lessons of human experience. The same basis underlies the reception of evidence of sexual behaviour on some occasions to prove consensual sexual conduct on a particular occasion, such as adultery201; or to prove intercourse leading to the birth of a child in respect of which support is sought by the mother202; or to prove a promise of marriage203. The Roman-Dutch writer Matthaeus described presumptions of fact as "nothing other than an inference of common sense, based upon what usually happens or is assumed to happen". He gave the following example204: "Clodius and Pompeia are found naked in bed together. A sufficient time for sexual relations to have taken place has elapsed. He has been in love with the girl for some time, and has written letters inviting her to have intercourse with him. Who would hesitate to condemn them both for adultery? Who is so lacking in common sense that he would be unaware of the usual consequences of night, wine, love, and a girl and boy together?" These consequences are inferences of consensual conduct based on reciprocated affection. But the same reasoning about "what usually happens or is assumed to happen" underlies proof of unilateral, unreciprocated desires of the type manifested and acted on according to the evidence under consideration. The reception of this type of evidence has come to be routine and unsurprising. Thus no question was raised about it in the leading English similar fact case of R v Boardman205. Two complainants gave evidence against the accused. There was no objection to the admissibility of evidence of each complainant about uncharged acts tendered on the charges on which that complainant gave 201 Eg Boddy v Boddy (1860) 30 LJ P & M 23; Wales v Wales [1900] P 63; McConville v Bayley (1914) 17 CLR 509; [1914] HCA 14. 202 Eg Cole v Manning (1877) 2 QBD 611. 203 Wilcox v Gotfrey (1872) 26 LT 481. 204 Quoted by Hoffmann, South African Law of Evidence, 2nd ed (1970) at 369: De Criminibus Ad D 48.15.6 (the translations are Hoffmann's). evidence. The only objection was to the use of the evidence of each complainant about conduct charged of which he was the victim to support the prosecution case in relation to the conduct charged of which the other complainant was the victim. However, evidence of uncharged sexual acts can be used for other purposes. Hodgson JA analysed the matter thus in a case on s 97 of the Evidence Act 1995 (NSW), which creates for what it calls "tendency evidence" a statutory version of the common law rules about similar fact evidence used to prove disposition206: "[W]here a man is charged with particular sexual assaults against a complainant, evidence that he committed similar assaults against the complainant on other occasions could be relevant in at least three different ways, only one of which would be as tendency evidence: It may be relevant to the extent of removing implausibility that might otherwise be attributed to the complainant's account of the assaults charged if these assaults were thought to be isolated incidents, in particular implausibility associated with the way each party is said to have behaved on these particular occasions. It may be relevant in supporting an inference that the accused was sexually attracted to the complainant, so that he had a motive to act in a sexual manner towards the complainant. It may be relevant in supporting an inference that the accused not only had the motivation of sexual attraction, but also was a person who was prepared to act on that motivation to the extent of committing sexual assaults." (emphasis in original) He said that evidence used for purpose (1) is "relationship evidence"207. Its use for that purpose in the present case is discussed below208. Hodgson JA said that 206 R v Leonard (2006) 67 NSWLR 545 at 556 [49]. 207 R v Leonard (2006) 67 NSWLR 545 at 556 [51]. use for purpose (3) is use as "tendency evidence", ie disposition evidence209. He said that use of the evidence for purpose (2)210: "is not use as tendency evidence: it is rather evidence supporting an inference that the accused had motivation to act as charged. Evidence of a similar kind could be provided by a letter from the accused declaring sexual attraction to the complainant, in the absence of evidence that the accused had actually done anything to or with the complainant. Evidence used in this way might be called relationship evidence or it might be called motivation evidence." He distinguished use for purpose (2) from use for purpose (3) in the following way211: "[T]endency evidence against an accused is evidence to the effect that the accused is a person who by reason of his or her character is more likely than others to act in a particular way or have a particular state of mind. Evidence that an accused actually has an ordinary human motive to do something, such as sexual feelings towards someone else, is not as such that kind of evidence. I do not think it could be said that, because a married man feels sexually attracted towards a woman other than his wife, he therefore has a tendency to commit adultery with her, even if he never does so." However, as Hodgson JA indicated, there are even greater possibilities of refinement, and this is illustrated by the approaches of prosecution counsel at HML's trial212. HML v The Queen: admissibility of the uncharged acts: relevance test Subject to any exclusionary rule, or to the operation of any discretion to exclude evidence, evidence is admissible either if it is relevant to a fact in issue, or if it is relevant to a fact which is relevant to a fact in issue. One category of the latter kind is circumstantial evidence, of which uncharged acts evidence is an example. "Facts in issue" are of two kinds – those which may be called "main facts in issue", and those which may be called "subordinate or collateral facts in 209 R v Leonard (2006) 67 NSWLR 545 at 556 [51]. 210 R v Leonard (2006) 67 NSWLR 545 at 556 [52]. 211 R v Leonard (2006) 67 NSWLR 545 at 556-557 [53]. 212 See also the much cited analysis of Doyle CJ in R v Nieterink (1999) 76 SASR 56 at 65 [43] and 72-73 [83]. issue". In civil cases the "main facts in issue" are those which are commonly defined by the pleadings or by some other technique of definition, but which, whether so defined or not, are those which the applicable legal principles require to be proved if some cause of action or some defence or some answer to a defence is to be made out213. In criminal cases the "main facts in issue" are those which the prosecution is obliged to prove if guilt is to be established, or which the defence must prove if some positive defence is relied on. Examples of "subordinate or collateral facts in issue" are those which affect the credibility of a witness, or the admissibility of particular items of evidence. What, then, is "relevance"? Stephen said214: "The word 'relevant' means that any two facts to which it is applied are so related to each other that according to the common course of events one either taken by itself or in connection with other facts proves or renders probable the past, present, or future existence or non-existence of the other." The jury were told there were five bases on which they could consider the uncharged acts evidence. On which, if any, was the evidence relevant? If so, for what purpose? Was it admissible? HML v The Queen: admissibility of the uncharged acts: sexual attraction gratified General. The fourth basis on which the trial judge directed the jury that the uncharged acts evidence could be used was that it "may ... indicate that both before and after the visit to Adelaide the accused had an ongoing sexual attraction to [his daughter] and sought gratification for that attraction by his conduct". Were this use limited to proving a sexual attraction, it would have amounted only to evidence of a motive to engage in sexual misconduct, which might or might not be acted on, and if acted on, might or might not be acted on frequently. But the use went beyond supporting a motive to engage in sexual misconduct; it showed a disposition to act on that motive, and to do so nearly as frequently as opportunity permitted215. This use of the evidence is not relevant 213 Goldsmith v Sandilands (2002) 76 ALJR 1024 at 1025 [2] per Gleeson CJ; 190 ALR 370 at 371; [2002] HCA 31. 214 A Digest of the Law of Evidence, 12th ed (1936), Art 1, adopted by McHugh J in Palmer v The Queen (1998) 193 CLR 1 at 24 [55]; [1998] HCA 2 and Goldsmith v Sandilands (2002) 76 ALJR 1024 at 1029-1030 [31]; 190 ALR 370 at 377. 215 Among many examples of this reasoning, see B v The Queen (1992) 175 CLR 599 at 601-602, 605, 610 and 618; [1992] HCA 68. only to the complainant's credit: it is relevant to the issue of whether the charged acts took place. In substance counsel for HML conceded that the uncharged acts were relevant for this purpose, save that he contended that evidence of the G-strings purchase was irrelevant. Secondly, he submitted that the uncharged acts could not be left to the jury as "independently supporting an inference of guilt". And, thirdly, he submitted that the evidence was similar fact evidence which failed to satisfy the test for receiving that type of evidence. It is necessary to deal with these three submissions in turn. The relevance of the G-strings purchase. The relevance of the G-strings purchase depended on what view HML's circle, and HML himself, had of their appropriateness as underwear for a girl of 9 or 10, for that view might cast light on whether HML's role in their purchase revealed him to have the disposition in question. Her mother thought them "quite disgusting". HML himself testified that he opposed the purchase and said that his daughter could never be allowed to wear them at school. In that sense it is common ground that the G-strings were not appropriate items for the daughter to wear. Counsel for HML relied on differences between the evidence of the daughter, her mother, HML and HML's current wife. The principal differences related to whether HML forced the purchase on his daughter, or whether she demanded that he make the purchase against his wishes. But those differences go only to the question whether the daughter's evidence should be accepted, not to whether that evidence was admissible. Counsel for HML also contended that the purchase of the G-strings probably occurred one year after the Adelaide trip: but even if it did, it could not affect its relevance, for evidence of sexual attraction can be relevant whether it relates to a period before the crime charged or after it216. However, had the G-string evidence been the only uncharged acts evidence, its admissibility may have been very questionable. By itself it was only probative, and then not strongly, of motive in the sense of sexual desire, as distinct from a propensity to act on it. It may therefore arguably not have been relevant. But an assessment of its relevance is not to be undertaken in isolation from the other evidence. Taken with all the other uncharged acts evidence, it was relevant to prove a disposition to act on the sexual attraction experienced by HML. "No independent support". Counsel for HML submitted that where evidence of uncharged acts comes solely from a complainant, it is "inappropriate to leave this as evidence of 'sexual attraction', as independently supporting an 216 In R v Beserick (1993) 30 NSWLR 510 at 523 Hunt CJ at CL said that in general the weight to be given to subsequent sexual activity will be less than that afforded to previous sexual activity. However, this must turn on the particular facts. See generally R v VN (2006) 15 VR 113 at 123-125 [35]-[41]. inference of guilt", for it rested in circularity. And he said that admitting the evidence carried "danger". The danger was that it "inappropriately elevates one part of the complainant's testimony in support of an inference of guilt when that part has no higher status [than] the other evidence it seeks to prove true". This submission plays on an ambiguity in the word "independently". It is true that there is a lack of independence in the sense that all the evidence depended solely on the complainant's account. But that does not make the evidence irrelevant or inadmissible. There is no rule that it had to be corroborated. There was no such rule217 even before s 34I(5) of the Evidence Act 1929 (SA) abolished the need for corroboration warnings in sexual cases and s 12A abolished the need for corroboration in relation to the sworn evidence of children. Once admitted, the evidence was capable of being used as an "independent" – a separate – element in a course of reasoning towards guilt. This process did not elevate one part of the complainant's testimony over another. Proof of propensity and the similar fact rule. Counsel for HML contended that it was important to clarify whether use of the uncharged acts evidence involved propensity reasoning or not. "If it does not involve propensity reasoning, then ... you can use that evidence to assist in drawing an inference about whether or not the accused was sexually attracted and was prepared to act on his sexual attraction with respect to the complainant, but on no account infer that ... because of that fact alone, the fact that he was alone with her in a room in Adelaide meant that it was more likely that he would commit such an offence." Counsel for HML submitted that the evidence could not be employed to support propensity reasoning because it could not be assumed that HML's attraction for his daughter was so constant and so uncontrollable that it was always acted on whenever an opportunity presented itself. Counsel distinguished the present case from R v Ball218, which he said was a case where acts of incest (which were uncharged because they were not crimes at the time of their commission) were received to demonstrate sexual attraction between a brother and his sister with a view to proving, not that they committed the crime of incest on a particular day, but that they did so on some day within a range of dates. In contrast, here the evidence was tendered as part of an enterprise of establishing that on a particular day in Adelaide HML procured his daughter to carry out fellatio on him, and that on the next day he penetrated her anally. This submission exaggerates the difference between R v Ball and the present case. 217 R v Bloodworth (1913) 9 Cr App R 80. There were two charges against the Balls. One charged an act of incest on a specific date, 20 September 1910. While the other charge related to a range of dates, it was a relatively narrow range – 1-14 July 1910. There was other evidence: the Balls represented themselves to be man and wife; they shared the main bedroom in their residence; on 20 September 1910 at 11.20pm the front door was opened by the sister wearing a nightdress; the brother came out of the main bedroom half dressed; that bedroom contained a double bed with bedding on it which bore signs of two persons having occupied it; while their residence had another bedroom, it had no bedding; the brother wrote to his sister in terms more affectionate than would be appropriate if he were writing to her quoad sororem. But in one respect the present case affords a stronger argument for admissibility than those available in R v Ball: in that case there was no direct evidence of the crimes alleged, but here there is. However, the fundamental weakness in counsel's submission was that it downplayed excessively the strength of HML's disposition, as revealed by the uncharged acts evidence, to act on his sexual desire for his daughter frequently, indeed on almost all occasions on which they met. The Pfennig test. In Pfennig v The Queen, Mason CJ, Deane and "[B]ecause [similar fact evidence] has a prejudicial capacity of a high order, the trial judge must apply the same test as a jury must apply in dealing with circumstantial evidence and ask whether there is a rational view of the evidence that is consistent with the innocence of the accused." In Phillips v The Queen, Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ said of the Pfennig test220: "[T]he test is to be applied by the judge on certain assumptions. Thus it must be assumed that the similar fact evidence would be accepted as true and that the prosecution case (as revealed in evidence already given at trial or in the depositions of witnesses later to be called) may be accepted by the jury. Pfennig v The Queen does not require the judge to conclude that the similar fact evidence, standing alone, would demonstrate the guilt of the accused of the offence or offences with which he or she is charged." The need to assume that the similar fact evidence will be accepted is supported by the following passage in Hoch v The Queen221: 219 (1995) 182 CLR 461 at 483; [1995] HCA 7 (footnote omitted). 220 (2006) 225 CLR 303 at 323-324 [63]; [2006] HCA 4 (footnote omitted). 221 (1988) 165 CLR 292 at 294 per Mason CJ, Wilson and Gaudron JJ; [1988] HCA "The basis for the admission of similar fact evidence lies in its possessing a particular probative value or cogency by reason that it reveals a pattern of activity such that, if accepted, it bears no reasonable explanation other than the inculpation of the accused person in the offence charged". (emphasis added) But there is a second assumption which must be made, this time in favour of the accused. This second assumption is that the evidence in the case other than the similar fact evidence may be accepted, but that the jury could conclude that it is insufficiently strong to exclude a reasonable doubt222. That assumption is necessary because if the contrary assumption were made – that the evidence in the case other than the similar fact evidence excluded any reasonable doubt – it would be impossible to carry out the task, required by many authorities223, of examining the admissibility of the similar fact evidence in the light of the other evidence, and in view of that examination assessing whether the evidence as a whole would remove a reasonable doubt. These propositions have been explained by Hodgson JA in a case to which counsel for HML referred, R v WRC224: "[I]f it first be assumed that all the other evidence in the case left the jury with a reasonable doubt about the guilt of the accused, the propensity evidence must be such that, when it is considered along with the other evidence, there will then be no reasonable view that is consistent with the innocence of the accused. That is, the propensity evidence must be such 222 R v Cahill (No 2) [1999] 2 VR 387 at 392 [24] (the trial judge "must accept at the least the possibility of the truth of the [accused's] account in determining whether there is a rational explanation of all the evidence consistent with innocence") per Buchanan JA (Winneke P and Charles JA concurring). 223 Eg R v Boardman [1975] AC 421 at 457; Harriman v The Queen (1989) 167 CLR 590 at 633; [1989] HCA 50; Pfennig v The Queen (1995) 182 CLR 461 at 482-483 and 485. 224 (2002) 130 A Crim R 89 at 102 [29]. This was a dictum, since in New South Wales it is the Evidence Act 1995 (NSW), not the common law, which applies. But Hodgson JA was of the view that the common law test expounded in Pfennig v The Queen applies under that legislation. That view has since been held erroneous: R v Ellis (2003) 58 NSWLR 700, approved by this Court in Ellis v The Queen [2004] HCATrans 488 in the course of rescinding special leave. Neither that fact, nor the fact that Hodgson JA was speaking obiter, affected the soundness of his exposition of the common law as a matter of principle. that, when it is added to the other evidence, it would eliminate any reasonable doubt which might be left by the other evidence." In another case Hodgson JA said of the Pfennig test225: "[C]ertainly [it] does not require the judge to reach the view that the jury acting reasonably must convict: the judge must form his or her own view as to whether there is no rational view of the evidence, as it then appears to the judge, which is consistent with innocence, and the judge does not need to speculate as to how precisely that evidence may be affected by the way it is presented at the trial or by cross-examination, or how other minds might view it." In R v WRC, Hodgson JA added that the test226: "does not mean that the judge must look at the propensity evidence in isolation, and not admit it unless there is no reasonable view of the evidence so considered that is consistent with the innocence of the accused of the offence with which the accused stands charged. That approach would be quite inconsistent with the correct approach for considering circumstantial evidence ... and the [test is sourced in] the character of propensity evidence as circumstantial evidence." HML's test for admissibility. Counsel for HML contended that the test for admissibility was "whether or not, absent the complainant's evidence of the charged acts, one would inevitably reason that [the] accused must have sexually abused [his daughter] (and in a particular way) on the charged occasion[s]" (emphasis in original). But that is not the Pfennig test. It depends on assuming that the uncharged acts evidence is correct and examining whether that evidence, taken with the daughter's evidence about the charged acts, leaves open a rational view that while he was alone with her in a room in Adelaide he did not behave as she said he did. In assessing admissibility, one does not assume that there is no evidence of HML's guilt beyond the fact that he was alone with his daughter in a room in Adelaide, for there is her evidence about what took place. Counsel for HML argued for a test even harder to satisfy than the Pfennig test. This must be rejected. The Pfennig test applied. It is necessary first to assume that the daughter's evidence about the charged acts could leave the jury with a reasonable doubt. It is necessary also to assume that her evidence about the uncharged acts, whether they took place before or after the charged acts, will be accepted. On these 225 R v Folbigg [2003] NSWCCA 17 at [28] (Sully and Buddin JJ concurring). 226 (2002) 130 A Crim R 89 at 101-102 [27]. assumptions, the question is whether the evidence of uncharged acts, when considered with the evidence of charged acts, would eliminate any reasonable doubt which might be left by the evidence of the charged acts considered by itself. In assessing this issue of admissibility, it is necessary to take the daughter's evidence of the uncharged acts at its highest, and that involves assuming a considerable amount of sexual activity with a young child over quite a long time. The answer to the question is that the evidence is admissible. That is because, on the assumptions required by the test, a long and persistent campaign of seduction by HML is revealed. During it he endeavoured to excite his daughter into a sexual interest in him, and to pander to it. He revealed himself to be under the influence of a strong sexual attraction to her, and he endeavoured to gratify it in a variety of ways on numerous occasions when he might easily have been interrupted and detected by his daughter's half brother. This renders it almost inevitable that her testimony, that he did so while alone with her away from home in a shared hotel room, was correct. The uncharged acts evidence is sufficient to remove the reasonable doubt which must be assumed to exist in relation to the evidence of charged acts by itself. Hence, although there is no suggestion in the record that the trial judge explicitly applied the Pfennig test, or was invited to do so, on that test the uncharged acts evidence was admissible. The applicability of the Pfennig test. Counsel for the prosecution in this Court put four arguments about the Pfennig test. First, while disavowing any direct attack on it, they launched numerous criticisms of it. Secondly, they contended that the fact that the state of mind of an accused person is dominated by sexual attraction for a complainant can be used in a way not requiring any assessment of that accused person's propensity. Thirdly, they submitted that even if the second submission were not correct, the Pfennig test did not apply. Fourthly, they submitted that if the Pfennig test was applicable, it could usually be satisfied227. 227 The terms of what South Australia said in these appeals about Pfennig v The Queen without applying for leave to have it overruled cause the imagination to wonder at the prospect of what it will say if it ever makes that application. If the executive of South Australia is hostile to Pfennig v The Queen, its energies, so fully harnessed in this case in criticising it, might be better employed in procuring its reversal by the legislative branch. It has been reversed, together with the qualification for the possibility of contamination through collusion enunciated in Hoch v The Queen (1988) 165 CLR 292, in Victoria (Crimes Act 1958, s 398A, especially s 398A(3)) and Western Australia (Evidence Act 1906, s 31A). The Hoch qualification has been abandoned in Queensland (Evidence Act 1977, s 132A). Pfennig v The Queen does not apply in federal courts and the Australian Capital Territory (Evidence Act 1995 (Cth), ss 97 and 98); New South Wales (Evidence Act 1995, ss 97 and 98); Tasmania (Evidence Act 2001, ss 97 and 98); and Norfolk Island (Evidence Act 2004, ss 97 and 98). Thus the common law as stated in Hoch v The Queen and (Footnote continues on next page) It is sufficient to deal with the fourth point by saying that if the Pfennig test applies in this appeal, it is satisfied. Accordingly it is not necessary to consider the third issue of whether it in fact applies. Nor is it necessary to consider the second issue, for in this and the other two cases the prosecution was correctly relying on the conduct of the accused persons towards the respective complainants as showing not only a sexual attraction, but a propensity to act on it very frequently by various forms of sexual assault. And it is not necessary to discuss the prosecution criticisms of the Pfennig test. HML v The Queen: admissibility of the uncharged acts: explanation for failure to complain The assigned basis for admissibility. The fifth basis on which the uncharged acts evidence was tendered against HML was put thus by the trial judge to the jury: "[T]hat this inappropriate behaviour continued late into 2002 may go some way to explain why there was no earlier complaint, particularly no complaint in or about October 1999 upon [the daughter's] return from Adelaide."228 Pfennig v The Queen survives only in South Australia and the Northern Territory, and the common law stated in Pfennig v The Queen without the Hoch qualification survives only in Queensland. This narrows the significance of debates about how far Pfennig v The Queen extends and whether it is wrong. Incidentally, only Western Australia deals in terms with "relationship evidence" ("evidence of the attitude or conduct of the accused person towards another person, or a class of persons, over a period of time"), which it treats in the same way as "propensity evidence" ("similar fact evidence or other evidence of the conduct of the accused person" or "evidence of the character or reputation of the accused person or of a tendency that the accused person has or had"): Evidence Act, s 31A. In England the Criminal Justice Act 2003, s 101(1)(d), renders evidence of the defendant's bad character admissible if "it is relevant to an important matter in issue between the defendant and the prosecution", while s 101(1)(c) renders it admissible if "it is important explanatory evidence". Section 102 provides that evidence is "important explanatory evidence" if, without it, the court or jury would find it impossible or difficult properly to understand other evidence in the case, and its value for understanding the case as a whole is substantial. 228 Reasoning of this type has been employed in other cases: Gipp v The Queen (1998) 194 CLR 106 at 113 [12] per Gaudron J and 131 [73] per McHugh and Hayne JJ; [1998] HCA 21; R v Nieterink (1999) 76 SASR 56 at 65 [43] per Doyle CJ ("The evidence of uncharged acts may also disclose a series of incidents that make it believable or understandable that the victim might not have complained about the incidents charged until much later in the piece, if at all. They may show a pattern of behaviour under which the accused has achieved the (Footnote continues on next page) A factual difficulty. Counsel for HML correctly submitted that there was one flaw in this reasoning. The last words quoted suggest that the question is: "Why didn't the daughter complain to her mother the first time she saw her on returning from Adelaide in October 1999?". Events that took place after the daughter saw her mother in October 1999 are irrelevant to that question. Another possible question is: "Why did the daughter delay until 2003 before complaining about the incidents said to have taken place in Adelaide in 1999?". Post-Adelaide misconduct, depending on its detail, might explain the delay described in that question, and hence might have relevance as going to establish a subordinate or collateral fact in issue. Contrary to a submission by counsel for HML, that is so despite the daughter's failure to give evidence in chief stating that she did not complain until 2003 because of her father's behaviour towards her after Adelaide, for an inference could be drawn from the nature of that behaviour that it explained her failure to complain. Self-bolstering: HML's submission. But counsel for HML submitted that even if the evidence were relevant to explain delay in complaining, there is a further and fundamental difficulty which affects its admissibility. The background to the submission is that under certain conditions a complaint of a sexual crime made "at the earliest reasonable opportunity"229 can be received in the prosecution's case230. Usually it is proved by calling evidence of the complaint from both the victim and the person to whom the victim complained231. At common law, when the complaint is received, it goes only to credit: it can support the credibility of the victim but it is not evidence of the facts stated in the complaint about the acts charged. At common law the accused submission of the victim. The evidence may establish a pattern of guilt on the part of the child, that could also explain the submission and silence of the child."); R v GAE (2000) 1 VR 198 at 217 [64] per Chernov JA; R v G, GT (2007) 97 SASR 315 at 324 [35] per David J. 229 For example, R v Gallagher (1986) 41 SASR 73 at 76 per King CJ (Millhouse J concurring). 230 R v Peake (1974) 9 SASR 458. 231 There is a controversy about whether, at common law, it is permissible to prove a complaint by the evidence of the complainant alone: among recent authorities R v Kincaid [1991] 2 NZLR 1 at 9 and White v The Queen [1999] 1 AC 210 at 216 assert that it is not, while R v J (No 2) [1998] 3 VR 602 and R v GAE (2000) 1 VR 198 at 228-229 [93]-[96] assert that it is. It is not necessary to resolve this controversy in the present cases. is entitled to rely on evidence of non-complaint or late complaint232. That evidence also goes only to credit: it can undermine the credibility of the victim but it is not evidence contradictory of the victim's testimony about the acts charged. HML's daughter gave evidence in chief as follows: she had never told anyone about her father's conduct while it was going on; the reason she had not was that "I didn't know how they would react, what would happen afterwards"; she "eventually" told "someone about what was happening"; and thereafter she told the police. Although this evidence was not objected to, counsel for HML in this Court correctly submitted that the evidence of these complaints was inadmissible because the complaints were not made "at the earliest reasonable opportunity"233 and that hence the evidence should not have been led. Counsel for HML then submitted that so far as the evidence of the post-Adelaide uncharged acts was relied upon to explain a failure to complain, it was "pure credit bolstering"234. Counsel for the prosecution in this Court joined issue and submitted: "Outside the context of the rule against prior consistent statements and the rule against hearsay, terms such as 'credit bolstering' and 'self-serving' are merely pejorative and say nothing about the relevance or admissibility of the evidence. There is no rule against 'self-serving' evidence." This collision raises important issues. Neither side did much to support its position beyond flagging it by recourse to the slogans just set out. However, the position adopted by HML's counsel has much force. In essence that position was that unless a challenge to credibility based on lateness in or absence of complaint 232 Kilby v The Queen (1973) 129 CLR 460 at 472 per Barwick CJ (McTiernan, Stephen and Mason JJ concurring); [1973] HCA 30. Barwick CJ denied that "lack of complaint is probative of consent". The charges relating to the Adelaide incidents did not turn on consent, but Barwick CJ's reasoning is otherwise applicable: complaint is "a buttress" to the complainant's credit, and non-complaint tells "against the consistency of the woman's account and accordingly is clearly relevant to her credibility in that respect". 233 R v Gallagher (1986) 41 SASR 73 at 76. 234 This approach would also render inadmissible the explanation for failure to complain elicited immediately before the evidence of complaints, for similar principles must apply: counsel did not concentrate on this, no doubt because of the insignificance of the express explanation for delay in complaining compared to the damaging impact of the uncharged acts evidence considered as an explanation for that delay. is foreshadowed before the complainant's evidence in chief is completed, an inquiry into the reasons for the lateness or absence is one which the rules of evidence do not permit the prosecution to initiate and conduct through the complainant's evidence in chief tendered solely for that purpose, whether by direct testimony to that effect of the kind the daughter gave in this case, or by giving uncharged acts evidence from which an explanation for delay may be inferred. In those circumstances, if delay in complaint is to be explained, it can only be explained by evidence given in the complainant's answers in cross-examination, or the complainant's answers in re-examination, or the subsequent evidence of some other witness. Australian authority. So far as direct Australian authority goes, it affords some support for the position advocated by counsel for HML. Gaudron J said in Gipp v The Queen235: "[E]vidence of prior sexual abuse may explain ... failure to complain" if that is an issue "in the trial", but it "can only be made [an issue] by the way in which the defence case is conducted"236. And in Bellemore v Tasmania237, Crawford J said, speaking of the regime established by the Evidence Act 2001 (Tas), ss 102-104 and 108: "[E]vidence explaining why a complainant delayed making a complaint ... will generally be relevant only to the credit of the complainant" and hence inadmissible in chief. Those legislative provisions do not suggest that they have effected any alteration of the common law position on the present point. Principle. The position advocated by counsel for HML has support in principle. In 1974, Lawton LJ said238: "[I]n general evidence can be called to impugn the credibility of witnesses but not led in chief to bolster it up." He also said that this had "long been thought to be the [rule] relating to the calling of evidence on the issue of credibility". McHugh J called this "the 'bolster rule'". He said239: "That rule stipulates that evidence is not admissible if it merely bolsters the credibility of a party or witness, whether the evidence is sought to be 235 (1998) 194 CLR 106 at 113 [12]; cf at 131 [73] per McHugh and Hayne JJ. 236 Some potential difficulties in a wider position asserted by Gaudron J are discussed at [331]-[335] below. 237 (2006) 170 A Crim R 1 at 19 [45]. 238 R v Turner [1975] QB 834 at 842, giving the judgment of himself, Nield and 239 Palmer v The Queen (1998) 193 CLR 1 at 21-22 [49] (footnote omitted). led in evidence-in-chief or cross-examination of another witness or in re-examination of the party or witness attacked." Thus, for example, it is not permissible for expert witnesses to be called to give reasons why another witness is reliable240. Here it is sufficient to concentrate on the incapacity of witnesses to accredit themselves in chief, and in particular their incapacity to anticipate attacks which may be made in cross-examination. So far as self-accreditation is permitted, it normally takes place in cross-examination to answer attacks made by the cross-examiner, or in re-examination, if the form of the cross-examiner's questions did not permit a full answer. The general rule was stated thus by Thomas J in relation to the following habit241: "A habit has developed in both criminal and civil jurisdictions whereunder the caller of a witness has the witness state a fact and thereupon asks him to state his reasons for doing the act or to say why he remembers the fact, or to say something about his own state of mind at that moment. This is asked in the expectation that the witness will give a convincing reason and make it easier for the jury or judge to accept the stated fact. Such practices lengthen trials by spawning false issues ... Only facts in issue should be led in chief. A witness may not lift himself by his own bootstraps to enhance his credit. If the fact which he states is challenged by the adverse party then that will be made apparent during cross-examination. The witness's reasons for doing the act or his purpose in doing so may then quite properly be asked, because it may help to show whether he should be believed in relation to that particular fact (ie on the question of credit). But it is for the cross-examiner, not the party calling the witness, to raise matters that go to credit. When this happens it may be permissible in re-examination to adduce evidence of the witness's state of mind when he did the act or made the observation or statement ... Unfortunately the practice of anticipation of such a challenge and the premature attempted rebuttal of the challenge has become widespread." Thus it is not permissible for witnesses to give evidence in chief of prior statements they have made consistent with their testimony to rebut an apprehended allegation that the evidence in chief was constructed after the events it describes: the evidence of the prior consistent statement must be given only after the allegation has been made242. Nor is it permissible for witnesses (other than accused persons) to give evidence of their own good character in chief. 240 R v Nelson [1982] Qd R 636; R v Robinson [1994] 3 All ER 346. 241 R v Connolly [1991] 2 Qd R 171 at 173-174. 242 The Nominal Defendant v Clements (1960) 104 CLR 476 at 479; [1960] HCA 39. It is, however, true that some accreditation can take place in chief. One example is a speedy complaint. Another example relates to introductory questions going to the addresses, marital status and occupations of witnesses: the answers can tend to accredit the witnesses by locating them in a certain social milieu. In the United States "the educational background or professional status or employment position of a non-expert witness may be asked, or the witness's lack of prior contact with the side who has called him may be brought out"243. In Australia the former practice is less common than the latter. Further, witnesses giving opinion or other evidence for which expertise is necessary must establish that expertise, and sometimes seek to make a virtue of that necessity by giving long and boastful accounts of their achievements. Another example is refreshing memory. That process depends on a witness having recourse in the witness box to a document which the witness made, or read and accepted as accurate, while the facts were fresh in the witness's memory. That recourse may merely stimulate testimony which rests on what is in the document without reviving the witness's recollection. Alternatively, it may revive an actual recollection. Either way the process tends to accredit the witness by revealing to the trier of fact that the witness made a prior statement consistent with the case which the party who invited the witness to refresh memory wishes to propound. The rule against proof of prior consistent statements in chief does not preclude proof of a victim's conduct just after an event alleged to be a crime, such as weeping or running away or going to a hospital. A further limited exception to the rule against prior consistent statements was stated thus by the Privy Council in White v The Queen244 by analogy to that type of evidence: "Their Lordships accept that when the complainant herself is giving evidence, it may be difficult for her to give a fair and coherent account of her behaviour after the incident without allowing her to mention that she spoke to other people who may not be available to give evidence (within the sexual complaints exception) of what she actually said. Their Lordships would not suggest that the mere mention that the witness spoke to someone after the incident was inadmissible. In most cases it will be very difficult to draw any rational distinction between consistent conduct, which is plainly admissible (eg that the witness wept) and the fact that she spoke to someone such as a parent. On the other hand, it is important to avoid infringement of the spirit of the rule against previous self-consistent statements by conveying indirectly to the jury that she had given a previous account of the incident in similar terms with a view to inviting 243 City of Baltimore v Zell 367 A 2d 14 at 17 (Md CA, 1977). 244 [1999] 1 AC 210 at 217. the jury to infer, not merely that her subsequent conduct was not inconsistent with her complaint but that her credibility was actually supported by the fact that she had told the same story soon after the incident." No doubt other instances could be assembled. However, the strictness of the "bolster" rule is illustrated by the narrow, specific and scattered nature of these exceptions to it. Australian law proceeds on the assumption, at least at the time a witness begins to give evidence, that the witness is creditworthy. It may be an assumption which is weakened in a particular case by clouds of doubt arising from other evidence already tendered, or by the paucity or the unsatisfactoriness of the evidence in chief. It may be an assumption which is further weakened in cross-examination. But the party against whom the witness's evidence is tendered often does not seek to destroy the creditworthiness of the witness. That party may decide not to cross-examine at all. That party may value one or two parts, perhaps more, of a witness's evidence, and wish to preserve it from taint of doubt; or may accept what a witness says in chief, but seek to add to it or to qualify it by eliciting additional answers in cross-examination. Immense waste of time could be caused if witnesses were permitted to arm themselves, in advance, with responses to attacks on their credibility which may never be made. Getting one's retaliation in first may be habitual in Welsh rugby circles; it is not encouraged by the classical common law model of trial. That model seeks to narrow tenders to what is necessary: there is no point in anticipating responses to a possible challenge which may never be made. In this respect the law is not harsh to witnesses, and in some ways it assists their credibility. For just as unsolicited excuses amount to self-accusation, so unprovoked attempts at self- bolstering may damagingly suggest a suspicious defensiveness and sensitivity. Principle as seen by Wigmore. But do these considerations have to give way in relation to the particular problem of explaining delay in complaint? Wigmore's analysis of American law appears to assume that it is open to the prosecution to elicit explanations in chief from victims for their delay in complaint or failure to complain at all. He reasoned as follows: The failure of a party to produce evidence indicates that the party fears to do so, and "this fear is some evidence that the circumstance or document or witness, if brought [forward], would have exposed facts unfavorable to the party"245. 245 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1979), vol 2, §285 "A failure to assert a fact, when it would have been natural to assert it, amounts in effect to an assertion of the non-existence of the fact."246 (c) A failure "to speak when it would have been natural to do so is ... an inconsistent statement or self-contradiction"247. The failure of a rape victim to complain soon after the rape is a self- contradiction of that kind248. If no evidence of a complaint is given, the jury are likely to assume that none was made, and "counsel for the accused might be entitled to argue upon that assumption". Hence the prosecution is entitled to forestall that assumption by proving that a complaint was made249. The failure to complain may be explained "as due to fear, shame, or the like, so that it loses its significance as a suspicious inconsistency"250. The difficulty with this reasoning as a matter of principle is that steps (a) and (b), from which all else is supposed to follow, are inconsistent with the common law of Australia. In civil cases the unexplained failure of a party to give evidence, call witnesses or tender material is not treated as evidence of fear that it would expose an unfavourable fact, nor as an assertion of the non-existence of the fact not proved: the only consequence is that the failure can cause an inference arising from the evidence of the opposing party to be more confidently drawn251. In general even this type of inference cannot generally be drawn in relation to the accused's failure to testify or call evidence252. 246 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1970), vol 3A, §1042 at 1056 (emphasis in original). 247 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1972), vol 4, §1135 at 298. See also vol 3A, §1042 at 1056. 248 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1972), vol 4, §1135 249 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1972), vol 4, §1135 250 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1972), vol 4, §1135 251 Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8. 252 Azzopardi v The Queen (2001) 205 CLR 50; [2001] HCA 25; Dyers v The Queen (2002) 210 CLR 285; [2002] HCA 45. Proposition (e) is not good law in Australia either. It would not be open to the defence to make an attack in final address on the credit of the witness for not complaining without having established the evidentiary foundation for it in cross- examination. Hence under our procedure, unless there has been sufficient questioning in cross-examination, it is not true that counsel for the accused "might be entitled to argue upon [the] assumption"253 that no complaint was made. So far as authority is concerned, the only English case cited in support of proposition (f) was R v Rearden254. There a child of nine gave evidence that the accused had committed the crime of carnal knowledge on three days – Thursday, when he "threatened to beat her if she told", Saturday and Monday. After the Monday incident she complained to her mother. The argument did not proceed by reference to the question whether the evidence of the threat was admissible in chief as evidence explaining non-complaint. Rather the argument centred on the admissibility of the second and third incidents, which Willes J upheld by treating all the incidents as "part of one and the same transaction"255 and as having "continuity" derived from the accused's threat of violence256. In any event the rule against self-accreditation is probably not infringed where the witness's account of the crime charged contains a possible explanation for non- complaint257. Wigmore also cited numerous American authorities. In most of them, it does not appear whether the reason for non-complaint was elicited in chief over objection or whether it was given in cross-examination. In some of the cases cited it was held not to be an error to permit prosecution counsel to ask the victim why no complaint was made immediately after the commission of the crime258. However, other courts disagree. In State v Werner259 the Court of Appeals of Maryland held it impermissible for the prosecution to question a witness who had 253 See [302] above. 254 (1864) 4 F & F 76 [176 ER 473]. 255 (1864) 4 F & F 76 at 76 [176 ER 473 at 474]. 256 (1864) 4 F & F 76 at 80 [176 ER 473 at 476]. 257 See [308] below. 258 State v Knapp 45 NH 148 at 150 and 155-156 (1863); State v Shettleworth 18 Minn 208 (1872); People v Ezzo 62 NW 407 (Mich, 1895). 259 489 A 2d 1119 (Md, 1985). allegedly been sexually abused by her stepfather about his abuse of her sister in order to explain the witness's delay in complaining. It applied the principle that "a party ordinarily may not sustain the credibility of his own witness absent an attack upon credibility by the other side"260. It considered that evidence of reasons for a five year delay in complaint elicited in chief was inadmissible, and that the correct approach was to wait for the defence to raise the issue of a failure to make speedy complaint in cross-examination if it wished to, and then to seek to explain the delay in re-examination261. This corresponds with the position advocated by counsel for HML. The Australian position contrasted with Wigmore's. It is probable, then, that the common law of Australia does not proceed on the view that the credit of a witness who has not complained is irretrievably damaged unless an explanation is given for non-complaint in chief. It treats a complaint as "merely and exceptionally constituting a buttress to the credit" of the witness262. It starts with the witness's evidence of the crimes charged, and treats a complaint as buttressing the witness's credit; even if there is no evidence of a complaint, the witness's credit stands, unless the testimony is manifestly questionable, until there has been cross-examination, including cross-examination about any failure to complain. The starting point is not that the witness's evidence is damaged by failure to complain until that failure is explained. To that approach there is one exception. It arises where the victim's account of the crime charged contains a possible explanation – for example, a threat by the accused to kill the victim. In that instance, the witness is not giving evidence for the sole purpose of bolstering her credibility: she is merely narrating the events which make up the crime, in a manner which may have the incidental consequence of strengthening her credibility. South Australian legislation. Counsel for HML's submission is not Two provisions relate to undermined by South Australian legislation. complaints. One is found in s 34CA of the Evidence Act 1929 (SA): 260 489 A 2d 1119 at 1125 (Md, 1985), quoting City of Baltimore v Zell 367 A 2d 14 at 16 (Md CA, 1977). 261 489 A 2d 1119 at 1125-1127 (Md, 1985). 262 Kilby v The Queen (1973) 129 CLR 460 at 472 per Barwick CJ (McTiernan, Stephen and Mason JJ concurring). "(1) Subject to subsection (2), where the alleged victim of a sexual offence is a young child, the court may, in its discretion, admit evidence of the nature and contents of the complaint from a witness to whom the alleged victim complained of the offence if the court, after considering the nature of the complaint, the circumstances in which it was made and any other relevant factors, is of the opinion that the evidence has sufficient probative value to justify its admission. Such evidence may not be admitted at the trial unless the alleged victim has been called, or is available to be called, as a witness." A young child is a child of or under 12 years of age: s 4. Section 34CA has been held to change the common law by rendering complaints evidence of the truth of the facts asserted263. But the section is silent on whether explanations for failure to complain can be given in chief, and the common law must be presumed to continue in these respects. The other relevant provision is s 34I(6a): "If, in proceedings in which a person is charged with a sexual offence, any information is presented to the jury, or suggestion made in the presence of the jury, that the alleged victim failed to make a complaint, or delayed in making a complaint, about the alleged offence, the judge must – (a) warn the jury that the alleged victim's failure to make a complaint, or delay in making a complaint, does not necessarily mean the allegation is false; and inform the jury that the victim of a sexual offence could have valid reasons for failing to make a complaint or for delaying in making a complaint." These provisions about jury direction do not prevent the jury from employing the reasoning permitted by the common law: that the complainant's failure to complain or delay in complaining goes to credit. And they do not suggest that it is permissible for the prosecution to seek to make up for the absence of a recent complaint by eliciting explanations from the complainant in chief for that absence. They say nothing about the time when the "information" must be "presented", or the "suggestion made". Prior notice of a challenge to credibility because of delay in or absence of complaint. How is notice of a challenge to the credibility of a complainant based 263 R v Corkin (1989) 50 SASR 580 at 582-583 and 587. on delay in or absence of complaint to be raised by the defence before the end of the complainant's evidence in chief? If notice has not been given by the conduct of committal proceedings or by something said or done in proceedings before the jury is empanelled, the principal formal method of giving it would be in an opening by defence counsel before the evidence begins. In Victoria the defence is obliged to make a statement immediately after the prosecutor's opening and before the prosecutor calls evidence264. In New South Wales265, South Australia266, Western Australia267 and Tasmania268 the defence is entitled to do so. Although these latter provisions are limited in various ways, they would ordinarily afford an opportunity to indicate that the defence is planning to take a significant point about delay in complaint. However, the South Australian provision only came into force on 1 March 2007, well after the three trials under consideration took place. At the time when the daughter gave her uncharged acts evidence in chief, it was unclear what the defence tactics in relation to the charged acts would be, and whether they would fasten on a failure to complain before 2003. Conclusion. For the above reasons, there is much to be said for the submission advanced on behalf of HML that the daughter's evidence about the uncharged acts was not admissible if tendered for the sole purpose of explaining a failure to complain about the charged acts before 2003, because it was an impermissible bolstering of the daughter's credit in chief. It is not, however, necessary to decide the point: since the fourth basis for tendering the uncharged acts evidence is sound, the evidence is admissible, and, once admitted, it can be used on the fifth basis as well as the fourth. HML v The Queen: admissibility of the uncharged acts: explanation of acquiescence The third use which the jury were told by the trial judge they could make of the uncharged acts was to explain why the daughter "acquiesced" in HML's conduct in Adelaide. This ground of reception has been employed in other cases269. As counsel for HML correctly submitted, tender to show why the 264 Crimes (Criminal Trials) Act 1999, s 13. 265 Criminal Procedure Act 1986, s 159(1) and (2). 266 Criminal Law Consolidation Act 1935, s 288A. 267 Criminal Procedure Act 2004, s 143(2) and (3). 268 Criminal Code, s 371(ab). 269 R v Etherington (1982) 32 SASR 230 at 235 ("to explain why she continued to submit to him and why he was able to commit his indecent acts upon her on the (Footnote continues on next page) daughter acquiesced was similar to tender to show why she did not complain: failure to acquiesce usually involves protest or complaint, and bolsters the complainant's credit; hence acquiescence undermines the complainant's credit unless that acquiescence is explained. There had been no disclosure of any planned defence tactics which could have made the evidence receivable in chief. Hence if HML's arguments about the inadmissibility of the uncharged acts evidence tendered solely on the fifth basis are correct, reliance on the third basis alone will not assist the prosecution. HML v The Queen: admissibility of the uncharged acts: to explain confidence The second basis on which the uncharged acts evidence was said to be relevant was that it might show why HML was "confident" enough to act as he was alleged to have acted in Adelaide. This too is reasoning that has been employed in some other cases270. Counsel for HML correctly submitted that HML's confidence can only be relevant in one of two ways. One is to show that he anticipated acquiescence – no protest and no complaint: as prosecution counsel said, because "it is known that [HML] has been able to do it without any effective complaint in the past". HML submitted that, so used, the evidence is being used as a means of bolstering the daughter's credibility. If his submission in relation to the fifth basis is sound, the second basis by itself is equally inadequate to justify reception271. The other way in which HML's confidence is relevant is to show that his behaviour in the past was very likely to be repeated in occasion charged") per Walters J; R v Josifoski [1997] 2 VR 68 at 77; Gipp v The Queen (1998) 194 CLR 106 at 130 [72] ("to explain why the complainant so readily complied with the various demands of the appellant") and 131 [73] ("to explain the complainant's apparent lack of surprise at being called ... to gratify the appellant's sexual desires") per McHugh and Hayne JJ; R v Nieterink (1999) 76 SASR 56 at 65 [43] (to "explain how the victim might have come to submit to the acts the subject of the first charge") per Doyle CJ; KRM v The Queen (2001) 206 CLR 221 at 230 [24] and 264 [134]; [2001] HCA 11. 270 Gipp v The Queen (1998) 194 CLR 106 at 131 [73] ("to explain ... the appellant's confidence – manifested by the omission of any threat or inducement – that the complainant would regard the incident as nothing unusual") per McHugh and Hayne JJ. See also R v Josifoski [1997] 2 VR 68 at 77 ("to explain why he would be confident that he could with impunity again assault her") per Southwell AJA (Phillips CJ concurring); R v Nieterink (1999) 76 SASR 56 at 65 [43] (otherwise "it might seem incredible to the jury that the accused would suddenly have committed the first crime charged") per Doyle CJ. 271 See [290]-[313]. future. Contrary to the submissions of HML, this latter use is permissible, because it is an instance of the fourth basis, discussed above272. HML v The Queen: admissibility of the uncharged acts: to provide context or background The prosecution position at trial. The remaining basis for admitting the uncharged acts evidence is the first. On that basis, as the trial judge told the jury, the evidence revealed a "relationship" which could "provide a background against which ... you can consider [the daughter's] evidence of what she said occurred ... in Adelaide"273. Similarly, prosecution counsel told the jury: "What happened in Adelaide, on the Crown case, didn't just happen out of the blue, it was part of an ongoing course of conduct, in which [the daughter] was being sexually abused over a number of years. If you hadn't heard about that evidence, you might wonder how on earth it was that, or why on earth it was that suddenly these two acts might happen, as I say, out of the blue in a hotel room. But what happened in Victoria is important, because it gives you the context in which the charged acts occurred." Counsel for HML's position on appeal. Counsel for HML submitted that evidence of the uncharged acts that took place after the Adelaide visit could not be admissible for the purpose under discussion. That submission is plainly correct. Counsel for HML also conceded, whether correctly or not, contrary to his predecessor's stance at trial, that up to a point the evidence was relevant on the basis described in R v Chamilos274. There O'Brien CJ of Cr D (Slattery CJ at CL and Grove J concurring) said: "[I]t is by no means easy for a complainant to describe the initiation and progress of a history of sexual gratification with her by an adult male (and especially her father) which began when she was a child of seven years 272 See [277]-[289]. 273 Counsel for HML contended that use of evidence to show "relationship" and use of evidence to show "background" were not synonymous. It is not necessary to resolve this issue. Counsel also submitted that the first use of the uncharged acts evidence relied on by the prosecution – to provide a context for the Adelaide events without which the unrealistic impression would be left that they occurred out of the blue – was not taken up in the summing up. In substance it appears to have been taken up in this passage. 274 Unreported, New South Wales Court of Criminal Appeal, 24 October 1985 at and regularly persisted, according to her account, for the ensuing nine years until she left the home. It is all the more difficult for such a witness to proceed intelligibly when she is required to confine her attention to three incidents more or less artificially selected over such a long history. It can make no sense for a girl in such a situation that she be precluded from any reference to the whole basis of her complaint and it would make, I should think, no sense for lay jurors that she be so confined. If successful it would leave jurors with a strange and unrealistic account of three unrelated acts of indecency separated by periods of years. To preclude any reference to such a history counsel must resort to leading questions as to time and circumstances of the offences charged. This can only serve to distort the evidence and distract the witness from a free chronological progression of a factual narrative which accords with the best of her contemporaneous recollection. In the end it will confuse her in what must be for her an illogical exercise. In any event it cannot really be successfully achieved. She will inevitably make some reference, as she did in her evidence in this case, to the background from which she is required to dissociate herself." (emphasis added) The several strands of thought underlying this reasoning may be found in other authorities. One strand of thought is that it is unrealistic for the witness to be limited to a description of the events relevant to the acts charged in such a way that they appear to "come out of the blue"275 and are "viewed in total isolation from their history"276. Another is that without the background evidence it is "scarcely possible to present the case in an intelligible and real fashion"277. Another strand of thought is that to permit evidence of background facts enhances the ease with which the witness tells the story and the natural tendency of the witness to refer to other incidents should not be checked. Yet another is the reception of uncharged evidence as a means of completing the witness's story278. Thus in both R v Chamilos and the present appeal, in describing a 275 R v Nieterink (1999) 76 SASR 56 at 65 [43]; R v GAE (2000) 1 VR 198 at 206 [22]; Tully v The Queen (2006) 230 CLR 234 at 278 [145]; [2006] HCA 56. 276 R v M(T) [2000] 1 WLR 421 at 426; [2000] 1 All ER 148 at 152, approving Birch, [1995] Criminal Law Review 651. 277 R v Garner (1963) 81 WN (Pt 1) (NSW) 120 at 122 (evidence of "a long course of cruelty and continued ill-treatment" received on a charge of assault occasioning actual bodily harm) per Sugerman J. See also O'Leary v The King (1946) 73 CLR 566 at 577 per Dixon J; [1946] HCA 44; KRM v The Queen (2001) 206 CLR 221 at 264 [134] per Hayne J; R v Etherington (1982) 32 SASR 230 at 235. 278 Thus in R v Pettnam unreported, English Court of Appeal, 2 May 1985, quoted in R v Fulcher [1995] 2 Cr App R 251 at 258, Purchas LJ said: "Where it is necessary to place before the jury evidence of part of a continual background of history (Footnote continues on next page) charged act, the daughter made a reference to the background events. That strand of thought would permit a narrow class of uncharged acts evidence – that which explained what HML was referring to when he said: "Why isn't it working? It's worked before." That use of uncharged acts evidence would rest on the need to explain fully the details of the events taking place on the occasion of the particular act charged. The thinking underlying the reception of evidence as "background" or "context", then, rests on two broad and partially overlapping bases. The first is that to exclude it is unfair to the witness: this is reflected in the italicised portions of the above quotation from R v Chamilos. The second is that it is inefficient for the trier of fact, and hence productive of injustice, to exclude the evidence: this is reflected in the portions of that quotation in bold type. Controversies about "background" evidence. These are powerful points of view, but should they prevail? The principal countervailing factor is the prejudice which uncharged sexual acts evidence can cause: for whether or not it is tendered for the purpose of establishing the accused's disposition, it will very often have that effect. If its effect is to establish the accused's disposition even though it was not tendered for that purpose, some think it must comply with a similar fact admissibility test279; some think it need not, but that it may be excluded on the ground that the effect is prejudicial, and exceeds the probative value of the evidence280; some think that it may be received, subject to a warning against using the evidence to show either specific or general disposition, to which others point out that these warnings are not easy to formulate or understand. Evidence scholars seldom meet together, even for merriment and diversion, but the conversation ends in a quarrel about these questions. It was common ground that triers of fact are likely to draw two inferences from sexual attraction which has expressed itself in conduct: one is that it is highly likely the attraction will persist, and the other is that there is a powerful tendency for that conduct to recur, because that is "what usually happens or is assumed to happen"281. The likelihood of these inferences makes uncharged acts relevant to the offence charged in the indictment and without the totality of which the account placed before the jury would be incomplete or incomprehensible, then the fact that the whole account involves including evidence establishing the commission of an offence with which the accused is not charged is not of itself a ground for excluding the evidence." 279 Pfennig v The Queen (1995) 182 CLR 461 at 513-514. 280 R v Leonard (2006) 67 NSWLR 545 at 557 [55]-[57]. 281 See the first quotation from Matthaeus at [272] above. evidence of that kind powerful. But it also makes it prejudicial, even if the evidence is not tendered to prove disposition, because of the risk that the trier of fact will decide particular factual controversies about what someone did by reference to the character traits displayed in past conduct rather than by reference to the particular material bearing directly on the controversy. Some think that a rule, like that in Pfennig v The Queen, peculiarly directed to negating the danger of prejudice, is suitable in relation to uncharged acts evidence even if it is only tendered as background. Bolstering effect of "background" evidence. Quite apart from these controversies, counsel for HML submitted that "background" evidence can have a bolstering effect on the witness's credibility which requires scrutiny in the light of the general principle against self-bolstering. He submitted that to use the uncharged acts evidence as "background" was to use it in a manner going only to the credibility of the daughter, since it tended to make her evidence more believable, as coming less "out of the blue", and hence less implausible, and to show her to be giving evidence in relation to the charged acts which was consistent with her past experience in relation to the uncharged acts. The submission was advanced to criticise the trial judge's directions for placing excessive significance on the evidence. But if the submission is sound, it suggests that the evidence could not be received solely to provide "background". It is a submission of some force. Excessive detail? The particular criticism which counsel for HML made about the reception of the pre-Adelaide uncharged acts evidence tendered in chief to give background or context (and indeed tendered for some of the other purposes) was that the "level of detail" given "was not needed to supply context"; more detail might have been admissible in re-examination "depending on the nature and content of the cross-examination"282. The basis for this submission was that background/context evidence "is not being used as evidence of guilt". Counsel submitted: "In respect of this evidence the jury is not being asked to make any findings about whether or not other incidents alleged by the complainant did or did not occur. The jury should not be asked to determine whether they are 'satisfied' about anything in this regard. No particular standard of proof applies and it is not appropriate to speak about the evidence having any 'use' if this is meant to imply an available basis of reasoning towards guilt." (emphasis in original) 282 There are certainly earlier cases in which concern about excessive detail in "background" evidence has been expressed, eg R v Bradley (1989) 41 A Crim R 297 at 302; R v Kemp [1997] 1 Qd R 383 at 398. This submission is reflected in the form of directions which HML submitted should have been given in relation to the uncharged acts so far as they were tendered to establish context: This evidence is before you solely to enable the complainant's account of the allegations the subject of the two counts in the Information to be placed in context and not seen in isolation. In particular, this evidence is before you so you can assess, in context, what the complainant said about the demand for sex allegedly made by the accused following the complainant's request to go shopping (the subject of count 1) and the complainant's account about what the accused allegedly said ('Why isn't it working. It's worked before') at the time of committing the offence the subject of count 2. In assessing whether or not you regard the complainant's account as plausible or implausible you are entitled to have regard to the whole of her evidence including her account of the other acts of sexual impropriety said to have occurred in Victoria. Both counsel have made submissions in respect of this subject. On the one hand the prosecutor has sought to demonstrate to you that this evidence shows that the complainant's evidence hangs together and is plausible. On the other hand, defence counsel has referred to this same evidence to show you that the complainant's evidence does not hang together and, is in fact, beset by inconsistencies and exaggeration. You are entitled to make what you will of the arguments put by either counsel on this subject having regard, as I have said, to the whole of the complainant's evidence. I direct you that you must not use this evidence as evidence of the accused's guilt of the two counts in the Information. It is neither necessary nor appropriate for you to consider whether or not this other alleged sexual impropriety in fact took place." This submission is erroneous. To begin with, the last sentence of the quoted directions is wrong. It may be true that the mere fact that uncharged acts relied on to give background or context took place cannot be used to support a case that the charged acts took place by reasoning that the disposition revealed by HML when he carried out the uncharged acts made it likely he committed the crimes alleged in Adelaide. But the uncharged acts evidence relied on to give background or context would be irrelevant and hence inadmissible unless the evidence rendered probable the existence of the charged act, or a fact relevant to a charged act. If the daughter's evidence of the charged acts in Adelaide stood alone, her account might be highly incredible. But it is less incredible when considered against the background of her father's past behaviour towards her. Background evidence "does support the guilt of the accused, by making the complainant's account of the assaults charged more believable"283. Hence the jury are asked to make findings about whether the uncharged acts occurred. The question is not whether the daughter believed or imagined they occurred. The evidence about the uncharged acts is pointless unless it tends to establish that they actually did occur. The question can be expressed by asking whether the Adelaide incidents happened "out of the blue": if prior sexual conduct by HML took place, they did not happen out of the blue; if it did not take place, they did happen out of the blue. To use the language of the proposed directions, the uncharged acts would not provide "context", nor assist in assessing the daughter's evidence as plausible or implausible or as hanging together, unless it was thought that they had taken place. There would be no point in debating the standard of proof applying to the uncharged acts (and it is another part of HML's argument that the standard of proof is satisfaction beyond reasonable doubt284) unless the prosecution were trying to prove the uncharged acts, and the defence trying to disprove them or cast doubt on them. Paragraph 3 of the suggested directions is thus inconsistent with par 4. A further difficulty in HML's argument that the evidence of uncharged acts was too detailed is that it is internally contradictory. HML submitted that the three statements of the daughter used as the basis for debating the admissibility of her evidence were different from the actual evidence she gave. These differences would not matter unless the existence of the uncharged acts was controversial. From the prosecution's point of view, the less detailed the uncharged acts evidence, the less convincing it might be. From the accused's point of view, the less detailed the uncharged acts evidence, the harder it might be for the defence to deal with the evidence, whether by searching cross-examination or by calling evidence in answer. Further, while sometimes it is the case that the less the detail the lower the prejudice, in other circumstances very general evidence might leave the minds of the jurors free to roam in an uncontrolled and dangerous way. In particular cases, counsel for the accused will make particular tactical decisions that seem most advantageous for the client: objecting to or not insisting on anything more than a general reference in some circumstances, permitting a highly detailed but unconvincing account to be given in others. Thus in Gipp v The Queen285 McHugh and Hayne JJ thought that in taking the former course counsel made "the better forensic choice" in allowing the complainant to give her sexual history "shortly and without prejudicial detail" turning on "the times, 283 R v Leonard (2006) 67 NSWLR 545 at 557 [54] per Hodgson JA. 284 See below at [339]. 285 (1998) 194 CLR 106 at 132 [75]. places and manner of [the] sexual interferences". On the other hand, in Tully v The Queen286 it was thought that it was far from irrational for defence counsel to have permitted the prosecution to tender evidence of the sexual history in detail, and herself to have explored it in cross-examination, and it was held that no miscarriage of justice arose. The argument propounded in this Court finds no foothold in the conduct of counsel for HML at the trial, for no explicit objection based on the supposedly excessive detail of the evidence was ever taken. In those circumstances it would be wrong to hold the uncharged acts evidence inadmissible on the ground of its detail. In any event, once the uncharged acts evidence was held admissible to prove the particular disposition of HML, it was legitimate for the prosecution to elicit the evidence in the detail which the daughter gave. Authority in this Court. There have been sharp divisions in this Court on the question whether uncharged acts not said to satisfy the similar fact evidence rules at common law, or their statutory equivalents287, are admissible. Thus Callinan J suggested that it was not permissible for the prosecution to tender evidence which was "non-specific" and "highly prejudicial" merely on the basis that it formed "part of the essential background". In his opinion, unless the conduct of the defence made it admissible, its admissibility had to rest on288: "some, quite specific, other purpose, including for example, in an appropriate case, proof of a guilty passion, intention, or propensity, or opportunity, or motive. There may also be cases in which a relationship between people may be directly relevant to an issue in a trial and in those circumstances admissible as such." He thought that "in a case ... in which there are multiple recurrent counts of the same offence or similar offences over a considerable period, any justification for the leading of 'relationship', 'contextual' or 'background' evidence will not be well founded". But he said that the position may be different where only one or a small number of offences are charged and "a truthful complainant is likely to be disbelieved if relationship evidence is excluded and in consequence the jury derive the impression that the complainant is saying that the accused molested him or her out of the blue"289. Callinan J assembled various arguments of a kind 286 (2006) 230 CLR 234 at 280 [149]. 287 See n 227. 288 Gipp v The Queen (1998) 194 CLR 106 at 168-169 [181]-[182]. See also Tully v The Queen (2006) 230 CLR 234 at 278 [144]-[145]. 289 Tully v The Queen (2006) 230 CLR 234 at 278 [145], quoting R v GAE (2000) 1 VR 198 at 206 [22]. meriting close consideration on an appropriate occasion – the difficulty of defining "relationship evidence", "background evidence" and "contextual evidence"290; the difficulty of using those concepts precisely; the prejudicial character of the evidence; disputes about the standard of proof; disputes about formulating jury directions291; and consequential complications292. To those considerations can be added the extreme difficulty an accused person may have in grappling with a mass of material which may not have been particularised or fully foreshadowed before the complainant enters the box, and the difficulty of reconciling the reception of evidence tendered only to show context or background with the principle against self-accreditation. Gaudron J appeared to adopt an even more restrictive approach: general evidence of sexual abuse on occasions other than those charged not admissible as similar fact evidence and not relevant to issues raised by the defence is inadmissible293. On the other hand McHugh and Hayne JJ favoured the reception of a general history of sexual interference not confined to the matters charged to explain why a complainant complied readily and without surprise with the demands of the accused; to prevent the evidence of the complainant seeming "unreal and unintelligible"; to explain the complainant's matter of fact presentation of that evidence; to explain a failure to complain; and to explain the accused's confidence that the complainant would not regard the incident charged 290 These difficulties are also discussed by Doyle CJ in R v Nieterink (1999) 76 SASR 56 at 65-66 [45]-[46] and 73 [85]. 291 Where uncharged acts are admitted to prove background, but not to prove disposition as similar fact evidence, it has been held necessary to give a direction that if the jury find the uncharged acts are proved, they are "not to use that finding to reason that the accused committed the offences charged": Gipp v The Queen (1998) 194 CLR 106 at 133 [78] per McHugh and Hayne JJ, see also at 156 [141] per Kirby J; R v Vonarx [1999] 3 VR 618 at 625 [21]-[24]. This is a difficult direction to give, and one which is not necessarily easy to follow: see [345] below. 292 Gipp v The Queen (1998) 194 CLR 106 at 166-169 [176]-[182]; Tully v The Queen (2006) 230 CLR 234 at 275-279 [136]-[147]. 293 Gipp v The Queen (1998) 194 CLR 106 at 112-113 [11]-[13]. Read as a whole, [11] accepts that general evidence of sexual abuse on occasions other than those charged is admissible if "directly relevant" to guilt. as unusual294. McHugh J295 and Hayne J296 have since agreed that until this Court decides to the contrary, Australian courts should continue to treat evidence of uncharged sexual conduct as admissible "to explain the nature of the relationship between the complainant and the accused", but should sometimes, perhaps often, warn of the limited use that can be made of evidence of that kind. In this case the uncharged acts evidence was admissible to prove HML's particular disposition to gratify his sexual attraction towards his daughter with a view to concluding that he gratified it on the occasions of the charged acts. Even if Callinan J's reluctance to accept that non-specific highly prejudicial evidence can be led only as part of the essential background and not for any of the specific purposes he itemised is correct, this is not a case where there is no specific purpose. Nor, indeed, can the evidence be called non-specific or merely general evidence of sexual abuse, as counsel for HML's complaint about its supposedly excessive detail illustrates. Whether as a matter of principle the view of Callinan J or the view of Gaudron J is correct is not a question which was thoroughly examined in the arguments presented to this Court. The question is extremely difficult because to be raised against the arguments supporting their point of view are numerous arguments bearing on its unfairness to witnesses, and on the social interest in convicting those guilty of crimes against small children which are both grave and difficult to prove. Three particular difficulties said to arise on Gaudron J's view may be noted briefly at this point. One is that her view would prevent, for example, the evidence of HML's daughter about what he said in relation to the second charge about what had "worked before" and what she understood him to mean. The existence of that difficulty may be questioned: as counsel for HML accepted, Gaudron J's approach does not prevent the tender of evidence about what happened on the occasion of the crime charged and events expressly or impliedly referred to on that occasion. that A second potential difficulty the defence fails until cross-examination to raise an issue about whether the evidence about the charged acts suggests an assault out of the blue, the complainant's account of all the abuse she has experienced may be offered in a fragmented way – some in chief, some in cross-examination, and some in re-examination. In jurisdictions that require no disclosure of the accused's hand before cross-examination, fragmentation remains an undesirable possibility, but it is an inevitable result of the collision 294 Gipp v The Queen (1998) 194 CLR 106 at 130-131 [72]-[73]. 295 KRM v The Queen (2001) 206 CLR 221 at 233 [31]. 296 KRM v The Queen (2001) 206 CLR 221 at 264 [134]. between the interests of the witness and of the defence which Gaudron J's approach seeks to resolve justly. A third potential difficulty is said to stem from the entitlement of jurors to think about the evidence for themselves whatever line the defence takes. That entitlement must be qualified by their duty to concentrate on the issues presented. The area of difficulty is also likely to be a narrow one. Discussion of it must assume that defence counsel has not, before the evidence closes, given any indication of reliance on the argument that the complainant's evidence is not credible because it narrates bizarre events as though they were isolated occurrences, and in particular has not cross-examined to make that point. The area is narrow because, in the first place, to cross-examine on the evidence about the charged acts so as to suggest that they never took place, without putting the proposition that they would not have happened in isolation, is likely to be a rare event in view of the extremely delicate skills and unusual capacity to control the witness which would be called for. Secondly, the area is narrow because a submission by counsel in address that the acts did not take place because their isolation made the evidence incredible would contravene the rule in Browne v Dunn297 and permit the recall of the witness to deny that the acts were isolated. Thirdly, the area is narrow in that to assume that counsel would not, by question or in address, suggest a lack of credibility because of the isolated nature of the acts charged is to assume a highly artificial and unrealistic trial and very risky defence tactics. But it is not necessary now to resolve the question whether either Callinan J or Gaudron J is correct, and it is not necessary now to decide whether, even if evidence tendered only to prove background but likely to have a prejudicial effect is admissible, it must first satisfy the Pfennig test. It is not necessary because the evidence was admissible in any event on the fourth basis. HML v The Queen: admissibility of the uncharged acts: conclusion The first, third and fifth bases for tendering the uncharged acts evidence, and from one point of view the second basis, were arguably not valid bases for admissibility in themselves. The fourth basis, properly understood, however, was: the evidence was admissible similar fact evidence capable of being used to establish HML's particular disposition to assault his daughter sexually as a step towards proving his guilt of the charged acts. In those circumstances it is not necessary to decide whether the first basis, and the other bases, could have supported the tender of the uncharged acts evidence had each been the only one relied upon. The result is that although much of the reasoning advanced by the prosecution in support of its tender of the uncharged acts evidence was erroneous, the actual decision of the trial judge to admit the evidence was correct. It follows that ground 2.5.1 of the amended notice of appeal fails298. Ground 2.5.2 is technically correct, but it does not lead to an order allowing the appeal. That is because the evidence was of a kind which, being admissible to prove a particular propensity, was capable of being employed for the other purposes relied on, which were incidental to and not inconsistent with the particular propensity purpose. It could be used, for example, to enhance the credibility of the daughter as much as an independently admissible and impressive account by her of the Adelaide events could have enhanced her credibility. The uncharged acts evidence here was not analogous to hearsay evidence which, once admitted for non-hearsay purposes, cannot be used for hearsay purposes; or evidence which, once admitted for credit purposes (like a prior consistent statement), is not admissible to prove the truth of the facts asserted. If the evidence were employed only for one of the other purposes, it had a potentially prejudicial effect because of the risk of its being used to establish a particular propensity, for which purpose it was not admissible. But that prejudicial effect was nullified once the evidence was properly held admissible for the purpose of establishing the particular propensity. HML v The Queen: admissibility of the uncharged acts: Evidence Act 1929 (SA), s 34I. At one stage counsel for HML submitted that the uncharged acts evidence was inadmissible, because it should not have been led without leave being sought by the prosecution pursuant to the Evidence Act 1929 (SA), s 34I. It is controversial whether s 34I applies to evidence elicited by the prosecution from a complainant in chief. Even if it does, the argument should be rejected. The point was not taken at trial, nor on appeal to the Court of Criminal Appeal. Even if it had been, the evidence was "of substantial probative value" within the meaning of s 34I(2)(a), and its admission was "required in the interests of justice" within the meaning of the tailpiece to s 34I(2). Hence, had leave been sought, it should have been granted. In any event, in the end HML did not contend that the prosecution's failure to obtain leave under s 34I rendered the evidence inadmissible. HML v The Queen: jury directions Complaints about jury directions on uncharged acts. Counsel for HML criticised the jury directions given by the trial judge. Apart from a complaint about the direction in relation to the standard of proof of the uncharged acts, these criticisms were not made at trial or in the Court of Criminal Appeal. However, in view of their close connection with the issue of admissibility, which 298 See [269] above. was raised at trial, there is no reason not to consider them to the extent necessary now. Standard of proof direction? One complaint which counsel made was that the trial judge failed to direct the jury that they could not find the uncharged acts proved unless satisfied beyond reasonable doubt. It is not necessary to decide whether that was the appropriate standard of proof, because, read as a whole, the summing up is not open to the criticism made. At the start the judge said: "If, in what I am about to say to you, I speak of matters being proved to your satisfaction, or if I use words like 'proved' or 'satisfied' or 'established' or 'accepted' or any other sort of word, what I always mean is proved beyond reasonable doubt." After discussing the potential uses of the uncharged acts, the trial judge said: "I direct you that you may not act upon the evidence of the uncharged acts unless and until you are satisfied as to it. Only then, if so satisfied of the truth of it, or of any part of it, may you use that evidence of which you are so satisfied when you consider the credibility of [the daughter] in relation to each count on the information and whether you are satisfied beyond reasonable doubt that either or both of them occurred." Counsel for HML relied on a supposed contrast between "satisfied" early in the second passage and "satisfied beyond reasonable doubt" near the end of that passage. That contrast is unlikely to have misled the jury in view of what was said in the first passage. Failure to direct on how "sexual interest" evidence could be used. HML submitted that the jury were not directed about "how sexual interest may be used in proof of guilt". This submission must be rejected. The jury were told not to act on the uncharged acts evidence unless satisfied of its correctness beyond reasonable doubt. They were then told that they could use the uncharged acts evidence of which they were so satisfied when considering the "credibility" of the daughter on each of the two counts charged – that is, in considering whether the events she alleged happened in Adelaide did happen. And they were told that they had to be satisfied beyond reasonable doubt that the Adelaide events happened as alleged. HML made no submission suggesting how the directions could have been improved. The evidence was in fact admissible, and was admitted, for a much more damaging purpose than considering the daughter's credibility – namely, proving HML's particular disposition. The summing up, in its restrained approach to that subject, was very merciful. Failure to direct about G-string evidence. HML submitted that the G-string evidence required special the only "independent" evidence in the prosecution case and because counsel for the treatment because it was prosecution relied on it heavily. This submission is not made out. The more damaging version of the event was not independent of the daughter, since she provided it. Nor can it be said that the prosecution address placed unduly heavy or disproportionate reliance on this item of evidence. HML submitted that the G-string evidence could only be used "in support of an allegation of ongoing sexual attraction and ultimately guilt" if the jury were satisfied that the only rational explanation for the purchase was HML's ongoing sexual attraction for his daughter, and, to be so satisfied, the jury would have to reject HML's evidence as to the circumstances of the purchase. These points were implicit in the general directions summarised in the previous paragraph: in being told that they had to be satisfied of the uncharged acts evidence beyond reasonable doubt, the jury were being told that they had to be so satisfied about the daughter's account of the G-string purchase, which involved rejecting her father's account. Support for and undermining of the daughter. HML also submitted that the trial judge effectively suggested that the uncharged acts evidence had the same effect as corroboration. This is not so. HML also complained that the jury were not told that if they rejected any part of the uncharged acts evidence, they could use that rejection adversely to the daughter's credibility. But that went without saying. Inappropriate elevation of uncharged acts evidence. HML submitted that if the uncharged acts evidence was admissible to give context, the directions were erroneous. He submitted that they inappropriately elevated the prosecution case in relation to the uncharged acts evidence as being evidence directly leading to guilt, when in truth it did no more than bolster the daughter's credibility in a fashion which was said to be "circular". HML also submitted: "Context being a non-propensity purpose, a very strong non-propensity warning should have been given." These criticisms proceed on erroneous assumptions. It was concluded above that the uncharged acts evidence was admissible to establish HML's propensity to act on a sexual attraction towards his daughter and that it was not necessary to decide whether it was admissible only to establish context299. Hence it was not admissible merely to bolster credibility. In any event the directions did not elevate the prosecution case on the uncharged acts evidence inappropriately. Nor did they support circular reasoning. Multiple bases of admissibility. Counsel for HML submitted that "the very array of possible uses would have left the jury with an exaggerated impression of the significance" of the uncharged acts. In truth, save in one minor respect300, they were all legitimate uses once the evidence was admissible to show a particular disposition, and it was difficult to exaggerate their significance. 299 See [277]-[289] and [316]-[335]. 300 See [291] above. Internal inconsistency? Can the directions be criticised on the ground that while the evidence was usable to support disposition reasoning, the jury were warned against that form of reasoning? The trial judge said: "I must also tell you how you cannot use this evidence. You must not use this evidence, if you are satisfied about it, or any part of it, to reason that because of it the accused is the type of person likely to have committed these offences. To so reason would be wrong and you must not do it. The fact that allegations are made about a number of occasions does not absolve you from the task of determining whether the charges themselves are made out." That warning was given at the invitation of the prosecution. Counsel for HML submitted that the warning was not detailed enough and not strong enough. If the warning did contain the error of internal inconsistency, it was an error favourable to the accused. But it did not contain that error. To speak of reasoning based on the accused being "the type of person likely to have committed these offences", or to speak of "disposition reasoning", can be to speak ambiguously. It is right to warn juries against what might be called generalised disposition reasoning – inferring guilt from the mere fact that the accused has behaved badly in the past, or has a tendency, for example, to use various victims, without scruple and against their will, as objects of sexual gratification. But this reasoning is different from using as an aid to reaching a conclusion of guilt the idea that the frequent use by the accused of his daughter as an object of sexual gratification reveals a disposition to do so. Thus in R v Vonarx301 it was said that juries "should be told not to reason that the accused is the kind of person likely to commit the offence charged"; but it was also said that evidence could be led, and used, "for the purpose of proving an improper sexual relationship or guilty passion which existed between the accused and the victim, tending to make it more likely that the offence charged ... was ... committed"302. In this respect what juries may be told corresponds with the tests for admissibility. Thus, to use the words of Dawson and Gaudron JJ in B v The Queen303: "[T]he evidence of the applicant's previous offences was inadmissible if it showed no more than the existence of a criminal propensity or disposition on his part. It would have been admissible if it established the existence of a relationship between the applicant and his daughter which pointed strongly in the direction of his guilt ... Had the evidence been tendered for 301 [1999] 3 VR 618 at 625 [22] per Winneke P, Callaway JA and Southwell AJA. 302 [1999] 3 VR 618 at 622 [13] per Winneke P, Callaway JA and Southwell AJA. 303 (1992) 175 CLR 599 at 619. the purpose of proving such a relationship, the onus would have rested upon the prosecution of establishing that the evidence went further than mere propensity or disposition and had an additional probative value which justified its admission despite its prejudicial effect." (emphasis added) Hence it is often right to warn against "general" or "bare" disposition reasoning, while leaving specific disposition reasoning open. The problem, and the solution, were accurately described by Byrne AJA304: "Where evidence of uncharged acts is led in proof of sexual attraction of the accused for the complainant, it will be seen that its purpose is perilously close to the prohibited use of evidence of propensity, so that the propensity warning with respect to this evidence must be crafted in such a way so as not to make a nonsense of the direction as to its lawful use. In cases where the victim of the charged and uncharged acts is the same person, this may not be an easy distinction to make. In such a case, the essence of the logic behind the admission of the evidence in question is that the accused, being a man who lusts after the complainant, is likely to have gratified this lust, as she says he did in her evidence in support of the counts on the presentment. The jury are told that where the uncharged acts show that the accused has a sexual attraction or passion for the complainant, they might use this to conclude that her evidence, that he gratified this attraction or passion on the occasions charged, should be believed. At the same time, they are told that they may not use the evidence of uncharged acts as showing that the accused is the kind of person who was likely to have done so on the occasion charged. The point of distinction, if there be one, is indeed a subtle one. It must lie in that between general and specific propensity. The evidence is admissible, not to prove guilt of the offences charged by a general disposition to commit crime, but to show the nature of the relationship in a manner which bears directly upon the question of guilt.305 In short what the jury are asked to do is to infer from evidence of uncharged acts that the accused has a disposition to commit the particular crime charged." (emphasis added) When the trial judge directed the jury not to reason that because of the uncharged acts "the accused is the type of person likely to have committed these offences", he was warning against reasoning from general disposition, not particular disposition. That is because once the evidence was received to show an ongoing sexual attraction which HML sought to gratify, its point was to 304 R v BJC (2005) 13 VR 407 at 420 [37]. 305 Harriman v The Queen (1989) 167 CLR 590 at 630. suggest that that attraction was very likely to be gratified in Adelaide – and hence to support a chain of reasoning which concludes that HML committed the charged acts against his daughter because of his particular disposition to commit sexual crimes against her as revealed by the uncharged acts. It follows that the trial judge's direction entailed no miscarriage of justice. Conclusion on directions. The only error in the directions, then, was the suggestion that the uncharged acts evidence after the daughter's return from Adelaide could explain her failure to complain on her return306. This was a small error. Counsel for HML at the trial did not consider that it merited a request for a corrective direction. Any ill-effects it may have had, if that were the only basis for receiving the evidence, were swamped by the much greater force of the particular disposition revealed by the evidence and by the trial judge's references to the standard of proof. The error was not an error of law and it did not create any miscarriage of justice. HML v The Queen: failure to charge HML with the uncharged acts Background. HML relied on three grounds of appeal stemming from the fact that he had not been charged with any crimes in relation to his alleged conduct in Victoria. Events at trial. At the trial counsel for HML contended that if the uncharged acts evidence was received it would be unfair to the accused unless the jury were told that the acts were "uncharged". Later the trial judge ruled twice that evidence that no charges had been laid was irrelevant. Thereafter the trial judge appears to be recorded as twice saying that the jury would be told that the uncharged acts were uncharged. While he did not in fact do this, he did tell them: "You know that these Victorian offences were investigated, but you do not know the outcome of that investigation. You must not speculate about what that outcome may have been. Whatever may have occurred in Victoria, if, indeed, anything did, cannot in any way help you here. You must decide this matter on the evidence which you have heard and seen in this courtroom during this trial. Nothing from outside it may be used to decide if the onus of proof has been discharged. Any such information is not relevant, as it cannot be helpful to you in that task. And so, I direct you in the strongest terms that you must not speculate, not only as to the Victorian investigation, but as to anything 306 See [291]. which has not been the subject of evidence. To do so would be wrong and you must not do it." Events in the Court of Criminal Appeal. The Court of Criminal Appeal held that the decision not to charge HML in relation to the Victorian allegations was not relevant: it reflected only the opinion of an unknown person. That Court held that any prejudice to HML was sufficiently avoided by the trial judge's directions, and that the jury must be taken to have heeded the warning not to speculate. The reference by the trial judge to "offences" rather than "allegations" could not be taken in context to have conveyed that the allegations had been proved, particularly since the trial judge also used the expression "uncharged acts" several times in the immediately succeeding passages, which implied that no charges had been laid307. HML's arguments in this Court. HML argued that the fact he had not been charged was relevant; that the summing up was unfair in that it left open the inference that he had been convicted; and that the trial judge's warning not to speculate did not neutralise that inference or the consequential unfairness. HML conceded that the reasons why no charges were laid were irrelevant. The fact that no charges were laid is equally irrelevant. Whether, unaided, the jury would have inferred, or guessed, from their ignorance about the irrelevant fact of whether there were or were not charges, that there had been, and that convictions had resulted, or whether they would have inferred, or guessed, that there had not been charges or convictions, is an open question. The fact is that they were not operating unaided. The trial judge gave a very strong warning. "The system of criminal justice, as administered by appellate courts, requires the assumption, that, as a general rule, juries understand, and follow, the directions they are given by trial judges."308 There is no reason to think that that assumption in the present case was incorrect. The trial judge's warning was sufficient to prevent the jury contemplating either of the inferences or guesses described above. HML v The Queen: order The appeal must be dismissed. 307 R v H, ML [2006] SASC 240 at [12]-[13] per Vanstone J (Nyland and White JJ concurring). 308 Gilbert v The Queen (2000) 201 CLR 414 at 420 [13] per Gleeson CJ and Gummow J; [2000] HCA 15. SB v The Queen: the trial After a trial before Judge Robertson and a jury, SB was convicted of three counts of indecent assault contrary to s 56 of the Criminal Law Consolidation Act 1935 (SA) and two counts of incest contrary to s 72 of that Act. The victim was his daughter, born on 7 June 1969. The acts alleged in relation to the first four counts were alleged to have occurred between 1 January and 31 December 1983. The acts alleged in relation to the fifth count were alleged to have occurred between 1 October and 31 December 1986. At the trial in 2006, the daughter gave evidence on the first count of attempted sexual intercourse. On the second, it was of cunnilingus. On the third, it was of fellatio. On the fourth, it was of vaginal rubbing. The events relating to the first four counts were said to have taken place while the daughter was living with her father. The fifth concerned vaginal intercourse which took place after she ceased to live with her father but while she was visiting him with her young baby. She said she did not consent to any of these acts. Without objection, counsel for the prosecution elicited from the daughter five classes of uncharged acts evidence. Four of them were said to have taken place before the first charged act at a house where SB lived with his de facto wife (who was not the victim's mother) and her two children. Those four were as follows: (a) On a couple of occasions, after a shower, SB opened his towel, revealed his penis to her and engaged in the act of "wiggling himself from side to side". SB invited his daughter to come outside at night to help him check on the welfare of certain animals and put tools away, and on several occasions gave her "a full, open mouth kiss with tongue". (c) On later expeditions of that kind, SB held his daughter close, hugged her and rubbed his body against hers. (d) On yet later expeditions, SB touched his daughter's breasts and vagina from outside her clothing, and then inside. The daughter also gave evidence of a fifth uncharged act: (e) A few days after the alleged events which underlay the first charge, SB gave his daughter a dildo and told her to start using it. She understood him to mean that she was to start inserting it into her vagina in order to prepare her to have sexual intercourse with him. SB v The Queen: the Court of Criminal Appeal SB appealed against conviction to the Court of Criminal Appeal, principally making the same criticisms of the trial judge's directions about the uncharged acts evidence as he makes in this Court. The Court of Criminal Appeal (Duggan, Sulan and David JJ) dismissed the appeal309. SB v The Queen: the structure of argument in this Court The notice of appeal was directed to the trial judge's directions about the uncharged acts evidence. However, during oral argument counsel for SB applied for leave to amend the notice of appeal by adding a ground contending that some or all of the uncharged acts evidence was not admissible, or not admissible on the bases advanced by counsel for the prosecution at the trial. Since the issue of what directions should be given depends on what evidence was properly admitted and for what purpose, it is desirable to consider this application for leave to amend first. SB v The Queen: application to amend notice of appeal Counsel for the prosecution did not oppose the grant of leave. However, leave should be refused for the following reasons. It is only in exceptional circumstances that an appellant in this Court in criminal proceedings will be permitted to rely on a point not taken either at trial or in the intermediate court of appeal310. Counsel for the prosecution at the trial said she was tendering the uncharged acts evidence to prove "the grooming process for what becomes the acts that are charged" and to "put the whole of the sexual contact into context". Before the application for leave to amend the notice of appeal was made, counsel for SB submitted that tendering the uncharged acts evidence to establish "'grooming' would appear to have some judicial support as an acceptable basis upon which the evidence can be admitted"311. He also submitted that, if the uncharged acts evidence were so used, it would avoid the need to comply with the Pfennig test. 309 R v S, B [2006] SASC 319. 310 Giannarelli v The Queen (1983) 154 CLR 212 at 221; [1983] HCA 41; Crampton v The Queen (2000) 206 CLR 161 at 171 [10], 185 [57], 206-207 [122] and 216-217 311 Citing R v IK (2004) 89 SASR 406 at 415 [48] as an example. However, in the course of the application for leave to amend, counsel for SB took the opposite tack in two respects. First, he submitted that "[o]bjection could ... have been taken" to the uncharged acts evidence because it did not satisfy the Pfennig test. Secondly, counsel submitted that objection "could have been taken to the relevancy of some or all of the evidence of uncharged acts" to the crime charged in the fifth count, which allegedly took place three years after the first of the events comprising the uncharged acts evidence. Of course objection could have been taken, but would it have succeeded? And if it had succeeded, could the objection have been overcome by re-tender on a more precisely articulated basis? Counsel supported his first submission by saying that evidence tendered to prove context or grooming could not prove a fact in issue. That may be so if the evidence showed no more than "context". But evidence tendered to prove "grooming" can prove a fact relevant to a fact in issue – it can render more likely the occurrence of that for which SB's daughter was being groomed. Hence an objection on that basis ought not to have succeeded. In addition, though the label "grooming" partly obscures this, the uncharged acts evidence demonstrated a sexual attraction for his daughter on which SB had not only acted, but on which he was planning to act in future, and the evidence was receivable on the basis that it showed that particular disposition. If, contrary to what has just been said, an objection to "grooming" had found favour, it would have been open to the prosecution to alter the basis of tender and advance different arguments for reception of the evidence. Those arguments could have centred on tender of the evidence to show SB's particular disposition to act on his sexual attraction for his daughter. The failure of the defence to object at trial, coupled with its contention in this Court that the evidence was objectionable, means that the prosecution has lost an opportunity of mending its hand which it would have had if the objection had been made at the correct time and had succeeded. Unless the defence could establish a serious injustice, that state of affairs points strongly against granting leave to amend the notice of appeal. There is no injustice. The evidence was relevant, both on the "grooming" basis and on the basis just discussed. If the test stated in Pfennig v The Queen312 applies, that test was satisfied for reasons similar to those applying in relation to HML313. Hence the first submission of counsel for SB must be rejected. So must the second. If evidence is admissible as establishing "grooming", or alternatively as establishing "sexual attraction" on which SB was prepared to act, either process is one which must start somewhere, and even though it may not 312 (1995) 182 CLR 461. 313 See above at [287]. culminate for years, the evidence of the uncharged acts, taken as it must be with the evidence of the charged acts, the evidence in relation to which was not said not to be cross-admissible, reveals a clear progression towards more and more serious crime. Accordingly leave to amend the notice of appeal should be refused. SB v The Queen: the summing up The trial judge summed up as follows to the jury: "Ordinarily in a criminal Trial, evidence of other alleged criminal conduct does not come before the Jury. In this case, you have heard this evidence because it is potentially helpful to you in evaluating [the daughter's] evidence. That is, hearing the whole of these allegations may better enable you to assess her evidence. The whole of the alleged course of events provides a context in which it is said that the charged acts occurred. In addition, the Prosecution also presents the evidence as explaining the background against which the first offence charged came about, and the other offences which are alleged to have followed, where the evidence of [the daughter] regarding, in particular, the first offence but also the following offences, may otherwise appear to be unreal or not fully comprehensible. In other words, if you are satisfied that some or all of the uncharged acts are proved, it may assist you in understanding how the evidence regarding the incident behind the tree, contained in Count 1, could have arisen, and to understand the incidents which are the subjects of the other charges, and which it is alleged followed the incident. Now, those two discrete matters which I have mentioned are the only ways in which you are permitted to use the evidence of the uncharged acts which were stated by [the daughter] in her evidence. Having directed you on the permissible manner in which you may use the evidence, I now turn to direct you on how you cannot use the evidence. If you find proved that the Accused was involved in any of the uncharged acts I have already described, you must not reason that the Accused must have committed any of the sexual acts, the subject of the charges in the Information. That would be totally wrong. Such reasoning is not permissible. Furthermore, it would be wrong to conclude, if you find proved that the Accused engaged in any of the uncharged acts related by [the daughter] in her evidence, that the Accused is the sort of person who would be likely to commit the offences for which he is charged. Remember, it is the evidence presented in proof of each of the charges, which is the critical evidence in this Trial. The evidence of the uncharged acts has only been presented for the purpose of the permissible uses to which I have referred. Of course, the first step in the process is to determine whether you are satisfied that any of the uncharged acts have been proved before you can use any of them in the permitted ways I have described. I will, again, refer to this evidence, and what you should do in the course of evaluating it shortly." Counsel for SB did not ask for any redirection. SB v The Queen: SB's criticisms of the summing up Conflict in authorities? Counsel for SB submitted that there was a conflict between the South Australian and Victorian courts as to the purpose for which uncharged acts evidence could be tendered in cases of sexual crimes. In South Australia, he said, the following bases for admissibility have been referred to in R v Nieterink – explaining how the "first charged incident came about", explaining "the lack of surprise" on the victim's part, explaining the accused's "confidence", explaining the failure of the victim to complain, and establishing "a sexual attraction"314. On the other hand, he referred to the statement in R v Vonarx by the Victorian Court of Appeal that the evidence should be used "only for the limited purpose of determining whether a sexual relationship existed between the complainant and the accused, thereby enabling the evidence relied upon by the Crown in proof of the offences charged to be assessed and evaluated within a realistic contextual setting"315. He advocated the latter approach. It is not necessary to resolve any difference which may exist316. Although the statement in R v Vonarx was made in relation to jury directions, if there is a difference in the approaches, the ultimate source of it turns on principles of admissibility. Counsel's argument in this appeal was necessarily advanced in relation to jury direction, not admissibility. The uncharged acts evidence was admissible at least to show "grooming", and that is to show a type of sexual 314 (1999) 76 SASR 56 at 72 [76]. See also at 65 [43]. 315 [1999] 3 VR 618 at 625 [22] per Winneke P, Callaway JA and Southwell AJA. See also R v Pearce [1999] 3 VR 287 at 295 [26]. Counsel for the prosecution submitted that R v Vonarx is either inconsistent with, or to be read down in the light of, other Victorian cases, citing R v BJC (2005) 13 VR 407 at 417 [25]-[26] and cases there referred to. 316 Any apparent difference is narrowed although not removed by consideration of the statement earlier in R v Vonarx [1999] 3 VR 618 at 622 [13], quoted at [345] above. relationship based on the attraction SB had for his daughter. Contrary to a submission advanced on behalf of SB, the evidence did more than merely bolster the daughter's credibility in relation to the acts charged, although that may have been its effect. Impermissible use left to the jury? Counsel for SB drew a contrast between what counsel for the prosecution told the trial judge the purpose of the tender was (evidence of "grooming" and putting "the whole of the sexual contact into context") and what the trial judge told the jury the purpose was (to give "context" and "background" so as "to assess" the daughter's evidence). He said that to use the uncharged acts evidence to "assess" the daughter's evidence was simply to use it to bolster the daughter's evidence on the charged acts, and that that was an illegitimate use, distinct from the only proper use – to put the evidence relating to the charged acts in context. Counsel for SB thus drew distinctions between directions about a (legitimate) use of the evidence (putting the charged acts into context) and directions about (illegitimately) assessing the daughter's evidence on the charged acts. It is not necessary to decide whether these distinctions have any theoretical merit. Even if they do, they lack practical materiality in the circumstances of this case. They do not signify any miscarriage of justice. In truth, as stated above317, the uncharged acts evidence established that SB had a sexual attraction for his daughter on which he was willing to act, and, if it had to, it satisfied the test stated in Pfennig v The Queen318. If the trial judge implicitly declined to accept the prosecution's tender of the evidence on that basis, he erred in doing so. It would have been legitimate for the trial judge to have given a much more explicit direction about how the evidence could have been used along those lines, but that would have been much less favourable to SB. The uncharged acts evidence was not mere context or background and, as in HML v The Queen, it is not necessary to decide whether that use alone is a sufficient passport to admissibility. Contradiction in direction? Counsel for SB also submitted that the trial judge caused confusion in his summary of a contention by counsel for the prosecution in final address. The contention was that the conduct comprised in the uncharged acts "doesn't just happen by chance in this way, that this is in fact, a concerted effort by the accused to introduce her to the idea of sexual behaviour, and that that is indeed what he is doing, because all of that behaviour then puts in context what he does to her behind the tree on the first count". Counsel submitted that the trial judge's summary caused confusion because the argument was inconsistent with the limited purpose of the evidence left by the trial judge to 318 (1995) 182 CLR 461. the jury. Counsel submitted that the trial judge erred when he said that the uses he said were permissible were identical with those which the prosecution contended for. There are two answers to this. The first is that in debate with counsel, the trial judge had said that while he would not direct the jury along the lines of counsel's argument, she was at liberty to advance it, and all the trial judge did was summarise the argument accurately, not give a comment on it or a direction about it. The second answer is that the most defensible way in which the trial judge could have removed any supposed inconsistency would have been to put forward prosecution counsel's approach as legitimate. Had the trial judge done this he would not have been acting wrongly, for the basis advocated by prosecution counsel was legitimate. But the consequence of removing any risk of confusion in this way would have been to put SB in a worse position. This suggests that the submission does not establish a miscarriage of justice. Standard of proof? Counsel for SB submitted, first, that the trial judge should have instructed the jury that the uncharged acts evidence "could not be used to infer that it necessarily followed that the charged acts occurred" and, secondly, "that the jury had to be separately satisfied, beyond reasonable doubt, that they did, in fact, occur". The trial judge in fact did direct the jury along the lines suggested in the first of these propositions, as is revealed in the third last and second last paragraphs of the passage from the summing up quoted above319. As to the second proposition, the trial judge gave a direction that the standard of proof of the uncharged acts was beyond reasonable doubt. Early in the summing up he said: "[D]uring the course of my summing up I may tell you, on occasions, that something must be proved by the Prosecution, or that you must be satisfied, or you should be satisfied of something in respect of the Crown case, then you need to understand, when I use those words, I mean proof or satisfaction beyond reasonable doubt." After summarising the uncharged acts evidence, and explaining the ways in which it could be used, he said: "[T]he first step in the process is to determine whether you are satisfied that any of the uncharged acts have been proved before you can use any of them". Whether or not it was necessary to do so, by these directions the trial judge told the jury not to be satisfied that any of the uncharged acts were proved unless they were satisfied beyond reasonable doubt. Propensity direction. Counsel seemed to criticise the trial judge for not telling the jury that they "should not reason that, if they found the uncharged acts proved, the accused was the sort of person who would [commit] the charged offences". In fact the trial judge gave that very direction – a general propensity direction320 – in the first sentence of the second last paragraph quoted above321. Vagueness? Counsel for SB submitted that the trial judge's words were too vague to be understood by the jury. In the circumstances of the case, the trial judge's language was sufficiently clear to prevent any miscarriage of justice. A further factor pointing against a miscarriage of justice is that the trial judge told the jury they could not use the uncharged acts unless satisfied (beyond reasonable doubt) that they had been proved. SB v The Queen: order The appeal should be dismissed. OAE v The Queen: the trial OAE was charged with one count of indecent assault, which was alleged to have occurred between 12 May and 31 July 1999, contrary to s 56 of the Criminal Law Consolidation Act 1935 (SA). He was also charged on a count of rape, which was alleged to have occurred between 12 May and 31 August 2003, contrary to s 48 of that Act. After a trial presided over by Judge Millsteed, the jury acquitted him on the first count but convicted him on the second. The complainant, who was the foster daughter of the applicant's sister, was born on 12 May 1987. The applicant owned a horse stud, and the complainant and her younger sister resided with her foster mother on an adjoining property from March 1993 to November 2003. In November 2003 the complainant alleged that OAE was violent to her, and she was removed from her foster mother's care. She did not complain about sexual misconduct at OAE's hands until March 2005. The trial judge rejected a defence objection to evidence that OAE carried out various uncharged acts on the complainant between 1999 and 2003. 320 See R v BJC (2005) 13 VR 407 at 420 [37], discussed at [345] above. Prosecution counsel submitted that they were admissible to show that the charged acts in 2003 did not come out of the blue, to show how a relationship developed in which the complainant submitted to OAE's behaviour, to show his confidence in repeating his behaviour, to explain her failure to complain, and to show sexual attraction amounting to a propensity. The trial judge admitted the evidence "to show the nature of the relationship" and to show that the conduct alleged in relation to count 2 "did not happen out of the blue". He said that the evidence was "more probative than prejudicial". And he reserved for consideration after the complainant had testified the question of whether her evidence was admissible to show sexual attraction. Eventually he concluded that it was not, for he directed the jury that the uncharged acts evidence was relevant to "show the nature of the relationship" and to repel the idea that the conduct relating to count 2 "had happened out of the blue" – that is, to put that conduct in its "proper context". OAE v The Queen: the Court of Criminal Appeal An appeal by OAE to the Court of Criminal Appeal was dismissed (Doyle CJ and Layton J; Debelle J dissenting)322. OAE argued two points: that the uncharged acts evidence was inadmissible; and that the trial judge had failed to direct the jury not to find the uncharged acts proven unless satisfied of them beyond reasonable doubt. The Court of Criminal Appeal rejected the first point unanimously and the second by majority. OAE v The Queen: the application to this Court In his application for special leave to appeal to this Court, OAE contended that the Court of Criminal Appeal had erred in upholding the trial judge's decision to receive the uncharged acts evidence, and in not concluding that the trial judge's direction was erroneous in relation to the standard of proof. OAE v The Queen: evidence of charged acts and of uncharged acts The complainant's evidence about the conduct underlying count 2 was summarised thus by Doyle CJ in the Court of Criminal Appeal323: "She was preparing some feed for the horses in the feed shed. [OAE] walked up to her, turned her around and pushed her head down. He held her down with his left hand on her back. [OAE] reached around to the front of her jeans with his right hand and undid them. He pulled her jeans 322 R v O, AE (2007) 172 A Crim R 100. 323 R v O, AE (2007) 172 A Crim R 100 at 103 [12]. and underwear down to her knees. He inserted at least one finger into her vagina, and moved a finger or fingers around and then stopped. [The complainant] said that she resisted, but was unsuccessful." After the acts alleged in relation to count 1 and before those alleged in relation to count 2, according to the complainant's evidence as summarised by Doyle CJ, the following uncharged acts occurred324: [OAE] touching involving indecent assaults "They were [the complainant's] breasts and vagina on the outside of her clothes, and inside her clothes, and on occasions inserting a finger or fingers into her vagina. She said that this happened often, almost daily. [She] said that on occasions she took a meal to [OAE's] room, and sometimes he would be dressed only in his underwear, and would get her to touch his penis on the outside of his clothing. She said that on occasions when they were driving to race meetings [OAE] asked her to engage in sexual intercourse, but she always refused." OAE v The Queen: admissibility of the uncharged acts Permissible uses. Among the purposes for which the prosecution tendered the uncharged acts evidence was the purpose of showing that OAE was sexually attracted to the complainant. The trial judge admitted the evidence, but not for the purpose of showing sexual attraction. He erred in that latter respect. To admit the evidence to "show the nature of the relationship", but not to show sexual attraction, where the dominant aspect of the relationship was one-way sexual attraction expressed in a very large number of sexual assaults, was to draw a distinction without a difference. Indeed counsel for OAE in this Court conceded as much in argument. The Court of Criminal Appeal was correct to disagree with the trial judge on this point. If the test in Pfennig v The Queen had to be satisfied, it was, for reasons similar to those applying in relation to HML325. In those circumstances it was legitimate also for the uncharged acts evidence to be used in the manner described by the trial judge – to put the charged acts evidence in context – and it is not necessary to decide whether, had that been the only possible use of the uncharged acts evidence, it would have been admissible. Lack of particularity. The principal attack made by counsel for OAE on the uncharged acts evidence was that it was "vague and lacked particularity". Counsel contended that the statements of the complainant on the basis of which the admissibility debate took place did not give particulars of the uncharged acts evidence. Those statements are not in evidence and it is therefore impossible to 324 R v O, AE (2007) 172 A Crim R 100 at 102 [9]. 325 See above at [287]. assess the validity of counsel's contention. So far as the complaint centres on a lack of particularity in the actual evidence given by the complainant, the complainant did give some circumstantial detail about one aspect of the uncharged acts evidence, and gave some more general evidence about the pattern of other aspects. Thus the complainant's description of the events which began a week after the event charged as count 1 was: "There were quite a few occasions. It happened quite often and, yes, it all just kind of blurred into one ... He would touch me a lot ... He would touch my breasts and my [crotch] area ... Sometimes over [clothing] and sometimes under ... Every couple of days ... [T]here was never anybody else around and it was usually any time of the day ... [a]round the stables and his house." She also said that on four or five occasions on the way to race meetings OAE asked the complainant to sleep with him, and on four or five occasions OAE made her place her hand on his penis outside his clothes. It is difficult to describe simple and much-repeated events without describing one instance and saying that that instance was replicated on later occasions. Counsel for OAE submitted that the lack of particularity in the complainant's evidence as to location, time and date prevented him from contesting her evidence with alibi evidence or evidence of persons who may have been present when the conduct was alleged to have taken place. In fact the complainant's testimony was that all the conduct took place in one of two locations – OAE's stables or his house; and that it took place at times identifiable by reference to the routine of OAE's establishment. It is true that it was imprecise as to date, but that has not been an absolute barrier to the reception of uncharged acts evidence in the past. Irrelevance. The other submission made by counsel for OAE in this Court was that the evidence was irrelevant: there was no need to rebut any inference the jury would draw from the fact that the count 2 events took place four years after the count 1 events, and, in particular, it was not unrealistic to ask them to consider that the count 2 events could come four years after the count 1 events without any other warning. He submitted: "[R]apes, by their very nature, occur 'out of the blue', and ... whether or not an [act] of this type occurred 'out of the blue' is not a material issue requiring the jury's consideration." The Court of Criminal Appeal was correct to reject that argument. The complainant's evidence about count 2 was that OAE was quite rough, indeed violent, to her on that occasion. If the jury had not been told that that had been a pattern of his behaviour towards her in the previous four years they might think her evidence about count 2 was incredible. Thus the evidence was relevant on the basis on which the trial judge admitted the evidence – to "show the nature of the relationship" and to show that the two charged acts "did not happen out of the blue". There is admittedly a question, discussed above326, whether that basis alone was enough to make the evidence admissible even though it was relevant. In view of the admissibility of the evidence on the ground that it showed OAE's particular disposition to act on his sexual attraction to the complainant very often, that question need not be answered in this application327. Preponderant impact of sexual attraction reasoning. Counsel for OAE also submitted that it is "quite artificial to have a shopping list of topics or purposes for which you can admit this evidence when at the end of the day the jury ... are going to use it for one purpose [only] and that is to see whether or not the accused was sexually attracted to the complainant". He submitted that uncharged acts evidence of the present kind is only admissible for that purpose. He submitted that, whatever narrower purpose uncharged acts evidence is tendered for, its effect can only be to prove sexual attraction, and that hence directions that the jury cannot use the evidence to infer "mere propensity" are futile. These too are questions which need not be answered in this application, because, contrary to the argument of OAE and the trial judge's ruling, the evidence was admissible to show OAE's particular propensity to act on a sexual attraction. "Submission" of complainant? The Court of Criminal Appeal said that the bases for admissibility assigned in R v Nieterink applied in this case. Among "The submission of [the complainant] to him over a period of time would give him confidence that she would submit again. It might help to explain the fact that [she] did not complain to her mother." The Court of Criminal Appeal said that the complainant's conduct in this case "involved a kind of submission to [OAE]. She did not kick and scream, nor did she immediately complain"329. Counsel for OAE pointed out that the complainant's evidence was that at least twice she told OAE to stop in a "loud" voice, that she had "struggled a bit" and that she had been "resisting"; and that while she had not gone so far as to "yell out" at any stage, that was because she was "too scared". This evidence is inconsistent with the idea that the complainant engaged in a "kind of submission" to OAE, or that any significance 327 See above at [387]. 328 (1999) 76 SASR 56 at 71-72 [75]-[78]. 329 R v O, AE (2007) 172 A Crim R 100 at 104 [20]. is to be attached to her failure to "kick and scream" or "immediately complain". So far as it goes, then, this submission advanced for OAE is sound. But it does not negate the admissibility of OAE's conduct as showing a particular disposition to act on his sexual attraction for the complainant. Other aspects of the Court of Criminal Appeal's decision. The Court of Criminal Appeal's adoption of the bases for admissibility summarised in R v Nieterink was reflected in another passage in Doyle CJ's reasons for judgment in this case. Doyle CJ said330: "[T]he Judge admitted the evidence of the uncharged acts on the basis that the evidence could be used to show that the incident the subject of count 2 did not 'come out of the blue'. I take that to mean that the jury could use the evidence to support a conclusion that [OAE] was prepared to seize an opportunity to engage in sexual conduct, had reason to believe that [the complainant] would submit to him if he did (even though not consenting to what he did), and that [the complainant] would not complain. If this evidence was not before the jury, they might find it difficult to accept that [OAE] would suddenly have acted as [the complainant] alleged, even though they were in daily contact." These ideas correspond with several of the bases for admissibility stated in R v Nieterink331. Later, Doyle CJ said332: "The uncharged acts provided a background that made [the complainant's] account of the incident, and her response to it, more believable. This use of the evidence did not involve any element of propensity reasoning." Yet if the evidence was being admitted "to support a conclusion that [OAE] was prepared to seize an opportunity to engage in sexual conduct", an element of propensity reasoning was involved. OAE v The Queen: jury direction Counsel for OAE submitted that if, contrary to the submissions just discussed, the uncharged acts evidence was admissible, the jury should have been directed that they should not take those acts into account unless they were satisfied of their existence beyond reasonable doubt. In the Court of Criminal 330 R v O, AE (2007) 172 A Crim R 100 at 104 [18]. 331 (1999) 76 SASR 56 at 72 [76], quoted above at [369]. 332 R v O, AE (2007) 172 A Crim R 100 at 104-105 [20]. Appeal, the majority said that that was not the law in South Australia333. Despite that, the majority also said that a "safer" course was "for the judge to tell the jury that they should be satisfied of the truth of the evidence, or something like that, even though that will suggest to the jury that this means satisfaction beyond reasonable doubt ... That avoids introducing the complication of differing standards of proof."334 But they held that even if counsel for OAE were correct, the direction he contended was required had been given. Debelle J disagreed. He said that at least in this type of case, "where evidence of uncharged acts consists of allegations of repeated sexual misconduct which is so intertwined with the charged acts", it was necessary for the trial judge to direct the jury that the uncharged acts be proved beyond reasonable doubt335. But the crucial difference between him and the majority was that he held that no such direction had been given336. It is not necessary to decide the controversy about the standard of proof – whether a direction about the standard of proof being beyond reasonable doubt need never be given, or need not be given when the evidence is admitted only to give context. That is because the majority correctly concluded that if the directions said by counsel for OAE to be required were required, it can be seen, when the summing up is read as a whole, that they were given. The trial judge directed the jury about the duty of the prosecution to "prove the charge and every ingredient of the charge beyond a reasonable doubt". He also said that an "accused person cannot be convicted of a crime unless the jury is satisfied of his guilt beyond a reasonable doubt". His direction continued: "I cannot keep saying that every time I deal with facts that are in issue in this trial. If, in the course of my summing up, I speak of matters being proved or being established to your satisfaction, or if I use some other expression relating to proof of matters in issue, then you will understand that I shall always mean proof beyond reasonable doubt." 333 R v O, AE (2007) 172 A Crim R 100 at 107 [30] and 108 [33]-[34]. They referred to R v IK (2004) 89 SASR 406 at 423-424 [78]-[86], 429-430 [126]-[132] and 432-434 [143]-[152]; R v S, B [2006] SASC 319 at [25]. 334 R v O, AE (2007) 172 A Crim R 100 at 108 [34]. They referred to R v Nieterink (1999) 76 SASR 56 at 72-73 [83]; R v Kostaras (2002) 133 A Crim R 399 at 407 [51] and R v Sciberras (2003) 226 LSJS 473 at 482 [39]. In passing, it may be said that either the standard of proof in relation to particular evidence is beyond reasonable doubt or it is not; if it is not, and if to tell the jury to be "satisfied" (without any amplifying definition) will suggest to them satisfaction beyond a reasonable doubt, they will have been misdirected. 335 R v O, AE (2007) 172 A Crim R 100 at 108 [38] and 109 [40], citing R v M, RB (2007) 172 A Crim R 73. 336 R v O, AE (2007) 172 A Crim R 100 at 109-110 [41]. The trial judge also said: "You cannot convict the accused unless you are satisfied beyond a reasonable doubt about the truth and accuracy of her evidence." In this passage he did not limit the "evidence" of the complainant to that relating to the incidents underlying the counts charged. The trial judge concluded his direction to the jury about the permissible use to be made of the uncharged acts by saying twice that the jury should not reason that OAE was guilty of the charged acts "simply because you happen to be satisfied that he committed one or more of the uncharged acts". The uncharged acts, flatly denied as they were by OAE, were "facts that [were] in issue in this trial" within the meaning of the general direction about the need for proof beyond reasonable doubt quoted above. That conclusion is supported by the following consideration. If the direction about proof of uncharged acts evidence beyond reasonable doubt was mandatory in this case, the direction which should have been given can only have been a direction that the evidence of any uncharged act relied on by the jury be established to that standard; it cannot be the case that none of the uncharged acts can be relied on unless all of them are established to that standard. At the end of the summing up counsel for OAE did not complain about a failure of the trial judge to give a direction that any uncharged act relied on be proved beyond a reasonable doubt. He made a different complaint, which was quite unsustainable and was rightly rejected by the trial judge, that the jury should have been directed that they "would need to be satisfied of the totality of [the uncharged acts] beyond reasonable doubt before they can use them in any contextual sense". The fact that counsel did not make a narrower complaint – that there had been no direction that any uncharged act relied on be proved beyond reasonable doubt – suggests that he did not understand that direction not to have been given. OAE v The Queen: orders An appeal would not resolve any question of law which is of public importance or in respect of which it is necessary to resolve differences of curial opinion. Nor is an appeal necessary in the interests of justice. On conventional principles it would follow that the application for special leave ought to be dismissed. However, in view of the unanimous opinion to the contrary of all other Justices on this question, but their equal division of opinion on the fate of the appeal, and to enable an order commanding majority support to be made, I would grant special leave but dismiss the appeal. Crennan CRENNAN J. There are three matters before the Court (two appeals and an application for special leave to appeal) which were heard consecutively. Each accused has been convicted of sexual offences against a young girl in a family relationship with him. At the trial of each of them, the prosecution led evidence of sexual misconduct between the accused and the complainant, which was not the subject of any count or charge. The three matters raise issues as to the admissibility of that evidence and particularly raise the question of the directions which should be given by a trial judge to a jury when such evidence is admitted. Those issues fall to be determined by reference to the common law337. The term "uncharged acts" was used throughout the parties' submissions, but it was recognised that some discreditable acts, taken in isolation, might be unlikely to be the subject of charges. The appellant was convicted on 22 March 2006 in the District Court of South Australia after a trial by jury of two counts of unlawful sexual intercourse with a person under 12 years of age338. The complainant, the appellant's daughter, was nine years of age at the time of the alleged offences. The alleged offences, one of causing the complainant to perform an act of fellatio upon the appellant and one of anal intercourse with her, were said to have taken place between 27 September 1999 and 4 October 1999 at Adelaide on an occasion when the appellant and his daughter had travelled to Adelaide and stayed together in a hotel room. The appellant pleaded not guilty to each count. The complainant gave evidence of sexual misconduct between the appellant and her which was not the subject of any count or charge. The prosecution case was that the two alleged offences were not "just a one-off incident" but that the appellant had been engaged in sexually inappropriate behaviour with his daughter both before and after the incidents in Adelaide from when she was seven years of age until she was 12. The complainant's parents separated when she was a small baby and she did not have contact with her father for a few years. After contact was re- established the complainant visited her father from time to time where he lived in 337 See [288] n 227 in the reasons of Heydon J for the relevant statutory provisions applicable in other jurisdictions. 338 Criminal Law Consolidation Act 1935 (SA), s 49(1). Crennan Victoria, although she lived with her mother in South Australia. Acts, other than those with which the appellant was charged, which the complainant described in evidence, were that the appellant walked around naked in front of her, he filmed her when she was doing cartwheels naked, he tongue-kissed her when kissing her goodnight, he performed cunnilingus on her, he placed his fingers in her vagina, he had vaginal intercourse with her, he had anal intercourse with her, and he purchased for her three items of G-string underwear when she was about nine years of age. The appellant gave evidence and denied these allegations, except for admitting that he purchased the G-string underwear which he said he had bought at the insistence of the complainant. Most, or all, of these incidents described in the complainant's evidence occurred in Victoria. The prosecutor had outlined the purposes for which it was sought to lead evidence of uncharged acts before the empanelling of the jury. The prosecutor said that the forensic uses sought to be made of the evidence did not include "propensity-type reasoning". The appellant's counsel objected and contended that the evidence of uncharged acts was "totally irrelevant". In terms of that debate, the trial judge ruled the evidence relevant and admissible. The purposes which had been outlined at the outset were repeated to the jury in the prosecutor's final address. First, the prosecutor told the jury that the incidents in Victoria put the conduct charged "into context" and that the offences charged were "part of an ongoing course of conduct". Secondly, the evidence of sexual misconduct which took place before the events in Adelaide was led for the purpose of enabling the jury to understand why the appellant had "the confidence" to do what he was alleged to have done and why the complainant "submitted to the acts". Thirdly, the evidence was led for the purpose of showing that the appellant had "a sexual interest" in the complainant. Fourthly, the evidence was led for the purpose of explaining why the complainant did not complain about the conduct the subject of the charges. In his summing up the trial judge said: "If, in what I am about to say to you, I speak of matters being proved to your satisfaction, or if I use words like 'proved' or 'satisfied' or 'established' or 'accepted' or any other sort of word, what I always mean is proved beyond reasonable doubt." Of the uncharged sexual misconduct his Honour said: "You know that these Victorian offences were investigated, but you do not know the outcome of that investigation. You must not speculate about what that outcome may have been. Whatever may have occurred in Victoria, if, indeed, anything did, cannot in any way help you here. You must decide this matter on the evidence which you have heard and seen in Crennan this courtroom during this trial. Nothing from outside it may be used to decide if the onus of proof has been discharged. Any such information is not relevant, as it cannot be helpful to you in that task." He then directed the jury not to speculate. As to the purpose for which the evidence of uncharged acts was led the trial judge said the evidence was led to give the jury "an understanding of what is said to have been the relationship between the accused and [the complainant]", "a background" against which the jury could consider the complainant's evidence of the conduct with which the appellant was charged. His Honour also said that the evidence of the uncharged acts "may show why it was that the accused was confident enough to ask for oral sex and then to penetrate [the complainant]". The trial judge also said the evidence may show why the complainant "acquiesced" and it might indicate that the appellant had "an ongoing sexual attraction" to the complainant and "sought gratification for that attraction by his conduct". The course of the appeal, by leave, to the Supreme Court of South Australia (Court of Criminal Appeal) and the grounds of appeal in this Court are set out in the reasons for judgment of Hayne J339. The main thrust of the argument and complaint in that Court was that evidence of the current state of criminal proceedings against the accused in Victoria should not have been excluded on the ground that it was not relevant340. Leave to amend the notice of appeal, which was sought and not opposed, should be granted. SB v The Queen The appellant was convicted on 8 May 2006 by majority verdict of a jury after a trial in the District Court of South Australia of three counts of indecent assault341 (the first, second and fourth counts) and two counts of incest342 (the third and fifth counts). The complainant, the appellant's daughter, was aged 13 or 14 at the time of the first four counts said to have occurred between certain dates in 1983 and aged 17 on the occasion of the fifth count said to have occurred in 1986. The appellant pleaded not guilty to each count. 339 Reasons of Hayne J at [134]-[139]. 340 R v H, ML [2006] SASC 240. 341 Criminal Law Consolidation Act 1935 (SA), s 56 (as it stood in 1983). The first count was attempted sexual intercourse, the second count was cunnilingus and the fourth count was vaginal rubbing. 342 Criminal Law Consolidation Act 1935 (SA), s 72 (as it stood in 1983 and 1986). The third count was one of causing the complainant to perform an act of fellatio on the appellant and the fifth count was one of vaginal sexual intercourse. Crennan The complainant gave evidence of sexual misconduct between the appellant and her which was not the subject of any count or charge. Her sister also gave evidence. The appellant gave evidence in which he denied the evidence of sexual misconduct constituting the uncharged acts. The complainant's evidence of uncharged acts included incidents of the appellant being naked under a towel which he opened and then wiggling his penis, of the appellant giving the complainant "a full, open mouth kiss with tongue", of the appellant holding the complainant close to him, hugging her and rubbing his body against her and of the appellant touching the complainant on the breasts and the vagina. Counsel for the appellant did not object to the relevance or admissibility of the evidence of the uncharged acts and no rulings as to admissibility were sought from the trial judge. The complainant was born on 7 June 1969 in the United Kingdom. In about 1972 her family migrated to Australia and her parents separated. Sometimes the complainant lived with her mother and sometimes with her father. She moved around a great deal. The children of the family were separated at times and stayed with different people over varying periods of time. In the early 1980s the complainant lived with the appellant, two of her brothers, the appellant's de facto wife and two children of the de facto wife. The prosecution case was that the appellant started to sexually abuse the complainant in about 1983. The prosecutor opened the case to the jury on the basis that the uncharged acts were "grooming" the complainant; that is, readying her for subsequent sexual advances. Prior to the trial judge summing up to the jury, and in the absence of the jury, the prosecutor explained the purposes for which the evidence of uncharged acts had been led. She said that evidence was led for two purposes: "[The uncharged acts] provide the starting point for the sexual contact that unfolds from there and without using the particular word of 'grooming' but they are precursors to what comes later and put in context the behaviour that comes later." In his summing up the trial judge referred to the uncharged acts and the forensic uses to which such evidence could be put. He said: "In this case, you have heard this evidence because it is potentially helpful to you in evaluating [the complainant's] evidence. That is, hearing the whole of these allegations may better enable you to assess her evidence. The whole of the alleged course of events provides a context in which it is said that the charged acts occurred. Crennan In addition, the Prosecution also presents the evidence as explaining the background against which the first offence charged came about, and the other offences which are alleged to have followed, where the evidence of [the complainant] regarding, in particular, the first offence but also the following offences, may otherwise appear to be unreal or not fully comprehensible." The trial judge not only directed the jury about the permissible use of the evidence, he went on to warn the jury about impermissible use. His Honour said: "Now, those two discrete matters which I have mentioned are the only ways in which you are permitted to use the evidence of the uncharged acts … If you find proved that the Accused was involved in any of the uncharged acts I have already described, you must not reason that the Accused must have committed any of the sexual acts, the subject of the charges in the Information. That would be totally wrong. Such reasoning is not permissible. Furthermore, it would be wrong to conclude, if you find proved that the Accused engaged in any of the uncharged acts related by [the complainant] in her evidence, that the Accused is the sort of person who would be likely to commit the offences for which he is charged. Remember, it is the evidence presented in proof of each of the charges, which is the critical evidence in this Trial. The evidence of the uncharged acts has only been presented for the purpose of the permissible uses to which I have referred." The course of the appeal to the Court of Criminal Appeal343 and the grounds of appeal to this Court are set out in the reasons of Hayne J344. OAE v The Queen The applicant seeks special leave to appeal from a decision of the Court of Criminal Appeal. He was tried before a District Court judge and jury on an information alleging one count of indecent assault345 (count 1) and one count of rape346 (count 2). A charge of unlawful sexual intercourse was laid as an 343 R v S, B [2006] SASC 319. 344 Reasons of Hayne J at [204]-[207]. 345 Criminal Law Consolidation Act 1935 (SA), s 56. 346 Criminal Law Consolidation Act 1935 (SA), s 48. Crennan alternative to count 2347. The applicant was convicted on the count of rape, the particulars of which were that between 12 May 2003 and 31 August 2003, the applicant had sexual intercourse with the complainant, without her consent, by inserting a finger into her vagina. The complainant was the applicant's sister's foster daughter who was 16 at the time of the offence of which the applicant was convicted. She gave evidence that this was the last occasion on which the applicant interfered with her sexually. She also gave evidence of uncharged acts of sexual misconduct by the applicant towards her. This evidence was that on "quite a few occasions" when she was helping the applicant in his stables, which she did daily over a four year period, he touched her on the breasts and the crutch, sometimes over and sometimes under her clothing. She stated that after she turned 12 this conduct happened very regularly, "pretty much every day", and at times the applicant penetrated her vagina digitally. The prosecution case was that the evidence of uncharged acts was admissible on a number of bases: as evidence of sexual attraction of the applicant towards the complainant, to explain both the complainant's submission to the applicant's sexual misconduct the subject of the charges, and her lack of contemporaneous complaint, and also as evidence which put the sexual contact between the applicant and the complainant "in its proper context". Over the objection of the applicant's counsel, the trial judge made an interlocutory ruling that the evidence of uncharged acts of sexual misconduct of the applicant towards the complainant was admissible on the basis that the evidence of sexual misconduct towards the complainant over a period of some four years was "more probative than prejudicial" and was "relevant to show the nature of the relationship between the accused and [the complainant]". The applicant gave evidence and denied all allegations. In summing up to the jury the trial judge said in relation to the uncharged acts that: "it would be wrong for you to use the evidence of the uncharged acts as establishing a propensity or tendency on the part of the accused to commit the charged offences. Putting it more simply, you cannot convict the accused of any count contained in the information simply because you are satisfied that he committed one or more of these uncharged acts. You cannot find the accused guilty of any count unless you are satisfied of his guilt based upon the evidence relating to that particular count. 347 Criminal Law Consolidation Act 1935 (SA), s 49(3). Crennan That does not mean that that the evidence of the uncharged acts is irrelevant. The evidence is relevant. On the prosecution case, the uncharged acts show the nature of the relationship which existed between the accused and [the complainant] during the four years leading up to the … incident, which is the subject of the second [count]. Without that evidence – without evidence relating to the uncharged acts – the circumstances of the [2003] incident might appear quite artificial or unrealistic. It would have appeared that after committing the first offence the accused – on the Crown case – did not sexually interfere with [the complainant] for another four years, though she attended his home on a daily basis. Putting it another way, it would have looked as if the [2003] incident had happened out of the blue, so to speak. So that is the permissible use to be made of the uncharged acts, ladies and gentlemen. The evidence is relevant to put the charged offences, and in particular [the second count], in [its] proper context, but that is the only legitimate use to be made of this evidence. I repeat, it would be wrong for you to reason – and you must not reason – that the accused must be guilty of the charged acts simply because you happen to be satisfied that he committed one or more of the uncharged acts." Relevance Evidence is relevant if it bears directly or indirectly on the probability of the existence of a fact in issue. The probability of the existence of a fact in issue is assessed according to common sense and the common course of events. In each of these three matters the impugned evidence was evidence of an older man in a family relationship with a young girl (in HML and SB, father and daughter; in OAE the accused was the brother of the girl's foster mother) engaging in acts and conduct which sexualised the family relationship. By that I mean acts and conduct which adapted the family relationship into a relationship in which the older man engaged in sexual misconduct with the young girl. Viewed in isolation, acts of sexual misconduct between an adult family member and a child may seem difficult to credit. Accordingly, evidence of prior (and subsequent) sexual misconduct between a child and a person accused of sexual crimes against that child may be relevant because such acts explain, or make intelligible, the offences charged by providing a context which shows that they are a part of continuing relations between the parties. Putting the same point in a different way, the uncharged acts Crennan are an integral part of the history of the offences charged. As Deane J stated in B v The Queen348, such evidence may provide: "the key to an assessment of the relationship between the [accused] and the [complainant] and, as such, constituted part of the essential background against which both the [complainant's] and the [accused's] evidence of the alleged offences necessarily fell to be evaluated". The evidence may also be relevant on other bases. When the existence of a relationship, characterised by "sexual interest" or "sexual attraction" of an adult accused towards a child complainant, points in the direction of the accused's guilt349, that evidence makes it more likely that the offence charged was in fact committed350. Such evidence may also render other evidence of the complainant more credible351 or it may be relevant to explain subordinate incidents, such as submission of the young girl to the older man's sexual advances or delay by the young girl in complaining about sexual misconduct towards her352. There is ample authority to support the proposition that the evidence is relevant. In McConville v Bayley353, evidence of prior adulterous relations was admissible against a co-respondent in a divorce case. Citing R v Ball354, 348 (1992) 175 CLR 599 at 610; [1992] HCA 68. 349 B v The Queen (1992) 175 CLR 599 at 619 per Dawson and Gaudron JJ. 350 R v Ball [1911] AC 47; S v The Queen (1989) 168 CLR 266 at 275 per Dawson J; [1989] HCA 66; Harriman v The Queen (1989) 167 CLR 590; [1989] HCA 50; B v The Queen (1992) 175 CLR 599. 351 As for example in R v Wickham unreported, New South Wales Court of Criminal Appeal, 17 December 1991. 352 R v Josifoski [1997] 2 VR 68 at 77 per Southwell AJA; see also R v Nieterink (1999) 76 SASR 56 at 65 [41] and [43] per Doyle CJ. 353 (1914) 17 CLR 509; [1914] HCA 14. 355 McConville v Bayley (1914) 17 CLR 509 at 512. See also R v Gellin (1913) 13 SR (NSW) 271 at 278 per Cullen CJ. Crennan "When it is a question of innocence or guilt as to the relations between a man and a woman who are not married, the whole history of the relationship is necessarily involved." In Wilson v The Queen356 ("Wilson") evidence of a pre-existing hostile relationship, between a person accused of murder and the victim, was relevant and admitted so as to ensure that the jurors were not required to decide the issues in a trial "in a vacuum"357. In R v Bond358, in a passage approved by Barwick CJ in Wilson359, Kennedy J said: "The relations of the murdered or injured man to his assailant, so far as they may reasonably be treated as explanatory of the conduct of the accused as charged … are properly admitted to proof as integral parts of the history of the alleged crime for which the accused is on trial." Both Wilson and R v Bond, sometimes called "relationship" cases, were concerned with acts relevant to the offences charged but were not, strictly speaking, "similar fact" cases from which a jury might reason that an accused has a propensity to commit murder. On occasions, evidence of a relationship between an accused and a complainant may negative defences such as accident or mistake or establish motive. As with evidence which is part of a connected series of events considered as one episode, the charges in these cases cannot truly be understood if isolated from the evidence of other sexual misconduct. Acts which are not part of the offences charged may nevertheless be "closely and inextricably mixed up with the history of the guilty act itself"360 or show "the continuing nature"361 of the conduct complained about so that the evidence explains the offences charged. If 356 (1970) 123 CLR 334; [1970] HCA 17. 357 Wilson (1970) 123 CLR 334 at 344 per Menzies J. See also R v Andrews [1987] 1 Qd R 21 and R v Bond [1906] 2 KB 389 at 401 per Kennedy J. Wilson has been followed in Frawley (1993) 69 A Crim R 208 and R v Ritter unreported, New South Wales Court of Criminal Appeal, 31 August 1995. 358 [1906] 2 KB 389 at 401. 359 (1970) 123 CLR 334 at 338 per Barwick CJ. 360 R v Bond [1906] 2 KB 389 at 400 per Kennedy J. 361 Gipp v The Queen (1998) 194 CLR 106 at 130 [72] per McHugh and Hayne JJ; [1998] HCA 21. Crennan evidence is confined to the events, the subject of the charges in these cases, that evidence would be "unreal and not very intelligible"362. That gives the evidence of other sexual misconduct a high degree of relevance363. Commonly enough, it will not be feasible to include all incidents of continuing sexual abuse in the charges which are laid in respect of specific acts. Juries understand well enough that sexual abuse of children can involve systematic abuse when the child and the abuser are family members. Jurors would find it strange if such evidence were not put before them if it exists. In these three matters the evidence of uncharged acts was relied on by the prosecution to establish the context in which the charges could be truly understood, so that the charges would not be considered in a vacuum. The context was a sexualised family relationship which was directly relevant to the proof of issues in the cases. In each case that evidence explained, and rendered intelligible, the offences charged. To exclude such evidence as irrelevant would occasion unfairness by requiring each complainant to give an incomplete account of her evidence. Principal submissions Relevance is a necessary but not sufficient condition for admitting evidence which discloses propensity. Before turning to the question of the possible exclusion of the evidence, despite its high degree of relevance, it is necessary to say something about the appellants' and the applicant's principal submissions to this Court. HML The appellant in HML commenced submissions with the proposition that the case raised a problem not resolved by Pfennig v The Queen364 ("Pfennig"). The gist of the appellant's submissions, so far as I understand them, was that where the uncharged acts are acts of sexual abuse against the complainant, the evidence inevitably discloses a propensity to commit the crimes as charged, despite a prosecutor leading the evidence for purposes other than propensity purposes and even positively eschewing any use of the evidence for propensity purposes. 362 O'Leary v The King (1946) 73 CLR 566 at 577 per Dixon J; [1946] HCA 44; see also R v Chamilos unreported, New South Wales Court of Criminal Appeal, 24 October 1985. 363 S v The Queen (1989) 168 CLR 266 at 275 per Dawson J. 364 (1995) 182 CLR 461; [1995] HCA 7. Crennan Identifying the relevance of the evidence by reference to a "sexual interest" or "ongoing sexual attraction" between the appellant and the complainant was said to exemplify the appellant's complaint. It was contended that evidence of prior sexual misconduct with a complainant, in the context of a charge of sexual offences against a child, always discloses propensity of an egregious kind. Underlying that submission there seemed to be a recognition that sexual conduct with children is not only prohibited under various criminal laws, but it is also the subject matter of a strong taboo in our society. That made the evidence of uncharged acts and the references to "sexual interest" and "ongoing sexual attraction" so highly prejudicial, so the argument ran, that the directions given were not adequate to guard against the danger that the jury would convict the appellant on the basis of bad character, or more narrowly, the specific propensity reflected in the phrases "sexual interest" and "ongoing sexual attraction", rather than because the jurors were satisfied as to the commission of the offences charged. This point has substance and I will return to it. In support of that argument there was said to be a difference, not only of emphasis, but also of principle, between R v Vonarx365 ("Vonarx"), a decision of the Court of Appeal of the Supreme Court of Victoria, and R v Nieterink366 ("Nieterink"), a decision of the Court of Criminal Appeal of South Australia. It was contended that Vonarx stood for the proposition that such evidence could only be led and relied upon for the purpose of proving a sexual relationship, whereas, it was said, Nieterink approved the use of such evidence for a wider range of purposes. Similarly, it was contended by the appellant in SB that the evidence of uncharged acts could only be used for the very limited purpose of showing a sexual relationship, or even more narrowly, sexual attraction. The idea was repeated that this type of evidence is inevitably propensity evidence which is so egregious that the risk is that a jury will reason that an accused has a propensity to commit the offence charged. OAE The applicant in OAE raised a similar complaint even more bluntly and submitted that evidence of many occasions of sexual misconduct, identified as relevant because it shows "sexual attraction", is not admissible because evidence 366 (1999) 76 SASR 56. Crennan of sexual attraction will "show propensity and that is all it can possibly show". That submission inevitably raised the question of whether the stringent test for admissibility confirmed in Pfennig applies to the evidence under consideration in these three cases. Admissibility No party argued that Pfennig should be qualified and no contention was advanced that the uncharged acts were inadmissible because they were not, strictly speaking, similar acts. It was submitted for the respondent in each case that Pfennig was distinguishable and so much seems to have been generally assumed by each of the accused. The background to any consideration of whether the evidence of uncharged acts in these matters should be admitted is the "thesis of English law" referred to by Dixon CJ in Dawson v The Queen367 that a crime is not to be proved by "the character and tendencies of the accused". In R v Makin, in the Supreme Court of New South Wales, Windeyer J considered the bar on proving guilt by reference to the character and tendencies of the accused was subject to "certain exceptions and limitations" compelled by "common sense and our experience of life"368. That case involved leading similar fact evidence to prove the actus reus. On appeal to the Privy Council, in Makin v Attorney-General for New South Wales369 ("Makin"), Lord Herschell LC said: "[T]he mere fact that the evidence adduced tends to shew the commission of other crimes does not render it inadmissible if it be relevant to an issue before the jury, and it may be so relevant if it bears upon the question whether the acts alleged to constitute the crime charged in the indictment were designed or accidental, or to rebut a defence which would otherwise be open to the accused." (emphasis added) When the theoretical underpinnings of the rule in Makin were re-examined in Director of Public Prosecutions v Boardman370 ("Boardman"), it was said that the general exclusionary rule operated to exclude relevant evidence which might prejudice a fair trial by upsetting the presumption of innocence "by introducing 367 (1961) 106 CLR 1 at 16; [1961] HCA 74. 368 (1893) 14 NSWLR 1 at 18. 369 [1894] AC 57 at 65. Crennan more heat than light"371; and that jurors in many cases would think such evidence "was more relevant than it was"372 so that the probative value of the evidence was outweighed by its prejudicial effect. However, Lord Cross of Chelsea recognised that such evidence may be "so very relevant that to exclude it would be an affront to common sense"373. Proceeding on the basis that Lord Herschell's concluding words in the passage from Makin set out above were only examples of the exceptions to, or limitations upon, the general prohibition respecting character evidence, the rule in Makin was restated in Boardman so as to emphasise the need to focus on the cogency of the evidence rather than seeking to assign it to a particular category of exception or limitation to the general exclusionary rule. That restatement was subsequently repeated in Director of Public Prosecutions v P374 ("DPP v P") by Lord Mackay of Clashfern LC (with whom the other Law Lords agreed). The Lord Chancellor said that for evidence of an offence against one victim to be admitted in a trial involving another victim, it was necessary375: "that its probative force in support of the allegation that an accused person committed a crime is sufficiently great to make it just to admit the evidence, notwithstanding that it is prejudicial to the accused in tending to show that he was guilty of another crime". After noting the restatement of Boardman in DPP v P, and referring to the need for a "clear and coherent theoretical foundation"376 for any exclusionary rule, the plurality judgment in Pfennig of Mason CJ, Deane and Dawson JJ explained377: 371 Boardman [1975] AC 421 at 454 per Lord Hailsham of St Marylebone. See also BRS v The Queen (1997) 191 CLR 275 at 321 per Kirby J; [1997] HCA 47. 372 Boardman [1975] AC 421 at 456 per Lord Cross of Chelsea. See also Pfennig (1995) 182 CLR 461 at 512 per McHugh J and BRS v The Queen (1997) 191 CLR 275 at 322 per Kirby J. 373 Boardman [1975] AC 421 at 456. 375 [1991] 2 AC 447 at 460. 376 Pfennig (1995) 182 CLR 461 at 481. 377 (1995) 182 CLR 461 at 482. Crennan "[T]he prejudicial effect that the law is concerned to guard against is the possibility that the jury will treat the similar facts as establishing an inference of guilt where neither logic nor experience would necessitate the conclusion that it clearly points to the guilt of the accused." Their Honours were considering the test to be applied in determining whether evidence of a similar offence against one victim was sufficiently probative of the identity of an offender in a trial concerning a different victim. They stated the test as follows378: "Because propensity evidence is a special class of circumstantial evidence, its probative force is to be gauged in the light of its character as such. But because it has a prejudicial capacity of a high order, the trial judge must apply the same test as a jury must apply in dealing with circumstantial evidence and ask whether there is a rational view of the evidence that is consistent with the innocence of the accused". As mentioned in Phillips v The Queen, references to propensity in Pfennig "must be understood against the background of the decisions, especially the decisions of this Court, that preceded it"379. The test of the plurality set out above confirmed a test accepted by Mason CJ, Wilson and Gaudron JJ in Hoch v The Queen380 ("Hoch"), which derived in turn from an observation by Dawson J in Sutton v The Queen381 ("Sutton"). Both Sutton and Hoch concerned the question of whether there should have been separate trials of a number of sexual offences alleged to have been committed by an accused against several persons. Hoch was particularly concerned with whether concoction between multiple witnesses had occurred. Each case was concerned with applying the basic criterion of admissibility of such evidence, namely whether the probative value of the evidence outweighed its prejudicial effect. In Sutton, Dawson J expressed his view that one matter not settled with precision in Boardman was the test for determining the sufficiency of the probative value of similar fact evidence. His Honour then referred to the direction, which would generally be required to be given to a jury where the 378 Pfennig (1995) 182 CLR 461 at 482-483. 379 (2006) 225 CLR 303 at 323 [62] per Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ; [2006] HCA 4. 380 (1988) 165 CLR 292 at 294-295; [1988] HCA 50. 381 (1984) 152 CLR 528 at 563; [1984] HCA 5. Crennan evidence relied upon is circumstantial, as the foundation for a test to determine the probative value of similar fact evidence382. The rationale underpinning the necessity for such a direction has long been understood. The direction originates in Hodge's Case383, which involved a charge of murder. The report states384: "Alderson, B, told the jury, that the case was made up of circumstances entirely; and that, before they could find the prisoner guilty, they must be satisfied, 'not only that those circumstances were consistent with his having committed the act, but they must also be satisfied that the facts were such as to be inconsistent with any other rational conclusion than that the prisoner was the guilty person.' He then pointed out to them the proneness of the human mind to look for – and often slightly to distort the facts in order to establish such a proposition – forgetting that a single circumstance which is inconsistent with such a conclusion, is of more importance than all the rest, inasmuch as it destroys the hypothesis of guilt." It is plain that the direction arose from the need to ensure that an accused received a fair trial, by directing the jury as to how it should apply the criminal standard of proof in a case turning entirely on circumstantial evidence. In Martin v Osborne385 there was no direct evidence of an element of the offence; similar fact evidence was sought to be led as a basis for inferring that essential element. Dixon J said386: "If an issue is to be proved by circumstantial evidence, facts subsidiary to or connected with the main fact must be established from which the conclusion follows as a rational inference. In the inculpation of an accused person the evidentiary circumstances must bear no other reasonable explanation. This means that, according to the common course of human affairs, the degree of probability that the occurrence of the facts proved would be accompanied by the occurrence of the fact to be proved 382 Sutton (1984) 152 CLR 528 at 563-564. 383 (1838) 2 Lewin 227 [168 ER 1136]. 384 (1838) 2 Lewin 227 at 228 [168 ER 1136 at 1137]. 385 (1936) 55 CLR 367; [1936] HCA 23. 386 (1936) 55 CLR 367 at 375. Crennan is so high that the contrary cannot reasonably be supposed. The circumstances which may be taken into account in this process of reasoning include all facts and matters which form constituent parts or ingredients of the transaction itself or explain or make intelligible the course of conduct pursued." The juxtaposition in that passage, of the direction to be given when circumstantial facts are to be relied on to prove an element of, or fact essential to, an offence, with a reference to evidence admissible to explain an offence, or make it intelligible, makes it clear that it is not the nature of circumstantial evidence which determines whether or not it needs to be proved to the criminal standard; it is the purpose for which reliance is placed on the circumstantial evidence which is critical. So much was borne out in the reasons of Dixon CJ in Plomp v The Queen, when his Honour considered whether evidence of motive could be relied on to prove guilt387. The clarification of Chamberlain v The Queen [No 2]388 to be found in Shepherd v The Queen389 bears out the same point. Thus the critical importance of identifying the purposes for which evidence of uncharged acts is to be tendered. The line of authority through Sutton and Hoch to Pfennig places a great deal of emphasis on similar fact evidence as circumstantial evidence. However, a question not decided in any of those cases, which bears on the adequacy of the directions given in these three matters, is whether the test of admissibility applied in Pfennig to circumstantial evidence of propensity led to prove identity, also applies to circumstantial evidence of facts or matters tendered to explain or render intelligible the offences as charged, which evidence incidentally reveals propensity. Pfennig For the reasons which follow, I respectfully disagree with the conclusion that the test set out in Pfennig applies, or should be extended to apply, to the evidence of uncharged acts in these three matters. In each case the evidence was led for purposes other than to establish propensity as proving an element of, or fact essential to, the offences charged. It can be accepted that the evidence of the uncharged acts in these three cases was evidence of "similar acts", despite a distinct awkwardness in grouping together two different kinds of similar fact cases: those concerning parties 387 (1963) 110 CLR 234 at 242-243; [1963] HCA 44. 388 (1984) 153 CLR 521; [1984] HCA 7. 389 (1990) 170 CLR 573; [1990] HCA 56. Crennan extraneous to the accused and the complainant, and those concerning prior continuous or recurrent conduct by the accused against the complainant. It can also be accepted that the evidence in each case discloses propensity, despite not being led for the purpose of establishing propensity as a fact from which guilt can be inferred. Further, it may be correct that the evidence of uncharged acts in all of these matters (with the possible exception of the G-string evidence in HML) could meet the stringent test of admissibility set out in Pfennig, so that there is no practical difference in result whether or not the Pfennig test is applied. However, because any account of the charged acts may be incomplete or incoherent without the evidence of uncharged acts and because it might be considered an affront to common sense to exclude the evidence of uncharged acts, the test to establish the probative value of that evidence is important. Consideration of the facts in Pfennig, and of the provenance of the test for admissibility there stated, shows that the rationale of the test is that it is intended to state a rule of law based on the criminal standard, which is designed to ensure there is no unfairness in a trial arising from inculpating an accused on the basis of a circumstantial fact of propensity. That the type of evidence of uncharged acts in each of these cases is distinctly unlike the evidence of similar facts in Pfennig was recognised explicitly in the minority judgment of McHugh and Hayne JJ in the case of Gipp v The Queen390, which concerned charges, the background of which was long-standing sexual abuse perpetrated by the accused upon his step-daughter. Their Honours said391: "[T]he evidence of the previous and continuing history in this case was far removed from the kinds of propensity evidence that have attracted the stringent requirements of admissibility and direction imposed by common law doctrine." Further, all members of the majority appeared to recognise that the higher standard of probative value set in Pfennig could not be automatically transposed to evidence of a relationship put forward as the context in which the offences charged occurred. Gaudron J appears to have accepted that evidence of the context of the charges might be admissible depending on issues raised by an accused392. Kirby J did not seem to apply the Pfennig test to the facts. Callinan J 390 (1998) 194 CLR 106. 391 (1998) 194 CLR 106 at 134 [81]. 392 (1998) 194 CLR 106 at 113 [12]. Crennan accepted that certain evidence of context may be admissible, although he sounded a warning about background evidence which was too general or too vague to have significant probative value393. The differences between the similar fact evidence in Pfennig, and the evidence of uncharged acts like that in these cases, were also recognised in KRM v The Queen394 ("KRM"). As well, respective appellate courts in Vonarx and Nieterink, which both concerned evidence of uncharged acts of sexual misconduct, distinguished the facts in each of those cases from the facts considered in Pfennig395. The importance of the differences is that the rationale for the Pfennig test has no application to evidence of a relationship put forward as the context which explains the offences or makes them intelligible. Another critical consideration is that these three cases are not entirely circumstantial. Evidence tendered to explain or make intelligible the conduct covered by the charges is not led as sole proof by which elements of, or facts essential to, the offence are to be proved. None of the accused is at risk of being inculpated solely by an inference of guilt based on the evidence of uncharged acts. Each complainant gave direct evidence of the elements of the charges such that a jury could convict each accused without any reference to, or reliance upon, the evidence of uncharged acts. A conclusion of guilt was open to a jury in each case, even if the jury rejected the evidence of the uncharged acts, or otherwise set it aside. A further consideration is that despite the existence of exclusionary rules, whether as framed in Makin or as expounded in Boardman and DPP v P or as further refined in Pfennig, evidence of a relationship between an accused and a complainant (or victim) has been admitted, notwithstanding possible revelation of propensity396, when the relationship is capable of being treated as explaining the offences charged. As observed by McHugh J in KRM397, numerous examples can be found where "relationship evidence" has been admitted which could not have satisfied the Pfennig test. 393 (1998) 194 CLR 106 at 168 [182]. His Honour repeated that warning in Tully v The Queen (2006) 230 CLR 234 at 275-276 [136]; [2006] HCA 56. 394 (2001) 206 CLR 221 at 229-231 [23]-[25] per McHugh J, 264 [133]-[134] per Hayne J; [2001] HCA 11. 395 [1999] 3 VR 618 at 622 [13] per Winneke P, Callaway JA and Southwell AJA; (1999) 76 SASR 56 at 65 [41] and 66 [48] per Doyle CJ. 396 Forbes, Similar Facts, (1987) at 223-226. 397 (2001) 206 CLR 221 at 230 [24]. Crennan As already mentioned, evidence of a relationship of mutual antipathy between a husband and wife, respectively the accused and victim, was admitted in Wilson for the purposes of throwing light on the offence of murder with which the accused was charged and to negative a defence of accident. More particularly, evidence of a relationship between an accused and a complainant has been admitted to prove sexual crimes against young people, including incest398. It was thought by at least one writer that when the Makin approach to exclusion was employed there was a "less exacting test" for the admissibility of "relationship evidence" than there was for similar fact evidence strictu sensu399. Whether or not that is correct, the differences between propensity evidence of the kind considered in Pfennig and the evidence of uncharged acts here are easily recognised400. Once a prosecutor demonstrates that the evidence of uncharged acts has a relevance beyond merely demonstrating propensity and disavows use of the evidence as propensity evidence, the test for admissibility is the basic criterion referred to in both Hoch401 and Pfennig402. That basic criterion requires asking whether the probative value of the evidence outweighs its prejudicial effect, whether that is specifically grounded in Boardman, or more generally in R v 398 See for example R v Whitehead (1897) 23 VLR 239; R v Gellin (1913) 13 SR (NSW) 271; R v Young [1923] SASR 35; R v Allen [1937] St R Qd 32; R v Power [1940] St R Qd 111; R v Cooksley [1982] Qd R 405 at 414; R v Etherington (1982) 32 SASR 230; R v Chamilos unreported, New South Wales Court of Criminal Appeal, 24 October 1985; R v Wickham unreported, New South Wales Court of Criminal Appeal, 17 December 1991. 399 Forbes, Similar Facts, (1987) at 223-224. 400 Pfennig (1995) 182 CLR 461 at 506 per Toohey J, 525-526 per McHugh J; Gipp v The Queen (1998) 194 CLR 106 at 112 [11] per Gaudron J, 132 [77] and 134-135 [81]-[85] per McHugh and Hayne JJ, 166-167 [177] and 168 [180]-[182] per Callinan J; KRM (2001) 206 CLR 221 at 229-231 [23]-[25] per McHugh J, 264 [133]-[134] per Hayne J; Smith and Holdenson, "Comparative Evidence: Admission of Evidence of Relationship in Sexual Offence Prosecutions – Part I", (1999) 73 Australian Law Journal 432. 401 (1988) 165 CLR 292 at 294-295 per Mason CJ, Wilson and Gaudron JJ, 300-301 per Brennan and Dawson JJ. 402 (1995) 182 CLR 461 at 481 per Mason CJ, Deane and Dawson JJ, 507 per Toohey J, 513-514 per McHugh J. Crennan Christie403, a possibility recognised in Markby v The Queen404, which first adopted the Boardman test as part of the Australian common law. The gloss on that basic criterion, imposing a higher standard of probative value, which arose out of the facts in Hoch and Pfennig, and the purposes for which the evidence was led in each of them, has no application to the purposes for which evidence of uncharged acts was led in these three matters. Other matters A number of other matters deserve brief mention. "Relationship" is a vague term. However, it is not the character of the evidence as "relationship evidence" which determines whether or not Pfennig applies. For example, if offences such as those at issue in these three cases were committed in circumstances which somehow precluded the complainant from giving direct evidence of the identity of the accused, then the relationship evidence might be led to prove propensity as probative of identity. However, if Pfennig applied in those circumstances there would be no need to warn against the use of propensity reasoning because the stringency of the test is based on permitting the fact of propensity to be relied on as probative of elements of, or facts essential to, the offence. Secondly, the expressions "sexual attraction", "guilty passion" and cognate expressions were employed in the 80 years or so between Makin and Boardman to identify a category of cases recognised as an exception to, or limitation upon, the general exclusionary rule in respect of character evidence. There was no particular consensus about the theoretical underpinnings of the exception405. Since Boardman, such expressions have continued to be used, although not exclusively to denote a fact or a pattern of conduct or to indicate intention, motive or propensity. In the matters under consideration, expressions of that kind were used to refer to a fact about the nature of the relationship, which was the context in which the offences charged occurred. That was the basis on which the evidence was put before each jury. Nevertheless, it cannot be denied that expressions such as "sexual interest" or "ongoing sexual attraction" applied to a sexualised family relationship 404 (1978) 140 CLR 108; [1978] HCA 29. 405 Compare, for example, Phipson, The Law of Evidence, 6th ed (1921) at 160-161 with Wigmore, Evidence in Trials at Common Law, 3rd ed (1940), vol 2, §360 at 274 and §398 at 355 and Cross, Evidence, (1958) at 281-282. Crennan between an adult accused and a child complainant inevitably point to propensity406. Nor can it be ignored that the specific propensity disclosed is in relation to a crime which might arouse disgust or other negative reactions, an important point particularly emphasised in submissions made in HML. The answer to that point is that when it appears unjust to exclude evidence of prior sexual misconduct because its probative value outweighs its prejudicial effect, balance and fairness to the accused must be ensured by requiring a trial judge to do three things: give a clear explanation to the jury of the purposes for which the conduct has been admitted, give a clear direction or indication not to substitute the evidence of prior misconduct for the direct evidence of the offences charged, and also give a warning against propensity reasoning in coming to a conclusion of guilt. Finally, the differences of principle said to exist between Vonarx and Nieterink seem more chimerical than real. To the extent that the description of purposes for which evidence of uncharged acts could be led differs in Vonarx and Nieterink, the differences reflect no more than specific ways in which the evidence of uncharged acts explains, or makes intelligible, the offences charged, a matter which will always turn on the facts of a case, and may do so irrespective of apprehended defences407. Use of expressions such as "context" or "true context" or "realistic contextual setting" or "background" or "essential background" to identify the relevance of evidence such as that under consideration here, does not and should not give rise to any particular difficulty so long as it is clear that such references, however expressed, are references to circumstances which are part of the integral history of an offence charged. If the evidence is so vague or so general as to not answer that description it may be rejected as irrelevant or because its probative value does not outweigh its prejudicial effect408. There are further general considerations which I have taken into account. In R v H409, an English case concerning the capacity of similar acts involving one victim to corroborate an account given by another victim, Lord Griffiths welcomed developments in the law which involved reconsideration and restatement of exclusionary rules. He recognised that judges in past times did 406 S v The Queen (1989) 168 CLR 266 at 275 per Dawson J. 407 Harriman v The Queen (1989) 167 CLR 590 at 601-602 per Dawson J; cf Gipp v The Queen (1998) 194 CLR 106 at 113 [12] per Gaudron J. 408 See Gipp v The Queen (1998) 194 CLR 106 at 168 [182] per Callinan J; Tully v The Queen (2006) 230 CLR 234 at 275-276 [136] per Callinan J. Crennan not trust less well-educated and often illiterate juries to evaluate all the relevant material. This, he said, explains the evolution of many exclusionary rules "deemed necessary to ensure that the accused had a fair trial in the climate of those times"410. In R v Seaboyer411, a Canadian case concerned with whether "rape shield" provisions infringed the right to a fair trial guaranteed by the Canadian Charter of Rights and Freedoms, McLachlin J, delivering a judgment on behalf of a majority, observed that it is fundamental to the Canadian system of justice that the rules of evidence should permit the judge and jury to get at the truth and properly determine the issues in a case. Faced with a similar issue in R v A (No 2)412, Lord Hope of Craighead approved this statement and went on to observe: "A law which prevents the trier of fact from getting at the truth by excluding relevant evidence runs counter to our fundamental conceptions of justice and what constitutes a fair trial." Such general considerations transcend the manifold factual distinctions which could be made between those cases and these three cases. They can be applied to the Australian legal system and are apt to be taken into account when considering whether the test for admitting evidence of uncharged acts of sexual misconduct, tendered for the purpose of showing the context of the offences, should be the stringent Pfennig test of probative value. Standard of proof It is the elements of a charge which must be proved beyond reasonable doubt. On occasions, a fact which is not one of the ultimate facts which constitute elements of the offence may nevertheless be so indispensable to a finding of guilt that the fact is metaphorically "a link in a chain"413; if so it will be necessary for a trial judge to direct a jury that that particular fact must be proved beyond reasonable doubt. However, as Dawson J observed in Shepherd v The Queen414, such a warning should not be given where it would be unnecessary or 410 [1995] 2 AC 596 at 613. 411 [1991] 2 SCR 577 at 609. 412 [2002] 1 AC 45 at 71 [55]. 413 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1981), vol 9, §2497 414 (1990) 170 CLR 573 at 579. Crennan confusing to give it or where it is not appropriate to give it because the evidence is not indispensable to a finding of guilt. HML I agree, for the reasons stated by Hayne J, that the evidence HML sought to tender concerning the status of criminal proceedings against him in Victoria was correctly excluded by the trial judge as irrelevant. As demonstrated by Heydon J in his reasons415, there was no substance in the complaint that the trial judge misdirected the jury on the standard of proof. For the reasons set out above, the evidence of uncharged acts was admissible for the purposes identified, all of which went to explain and render intelligible the conduct with which the accused was charged. The directions given by the trial judge included an explanation to the jury of the limited purposes for which the evidence was admitted, a direction not to substitute the evidence of uncharged acts for the evidence of the offences charged and a warning against propensity reasoning: that because the accused engaged in sexual misconduct other than that with which he was charged, he was the kind of person likely to have committed the offences. Such directions were adequate and did not give rise to any miscarriage of justice. I agree with Gleeson CJ, Kirby, Hayne and Heydon JJ that leave to amend the notice of appeal in this Court to raise the issue of the admissibility of evidence, to which no objection was taken at the trial, should be refused in accordance with settled principles416. The trial judge allowed the evidence of uncharged acts to go to the jury for the limited purpose that the evidence might put the offences in context and thus assist jurors in understanding the offences charged which might otherwise have seemed difficult to comprehend. The trial judge directed the jury that it could not substitute that evidence for the evidence of the offences charged. His Honour also gave a warning to the jury against propensity reasoning. Such directions were adequate and did not give rise to any miscarriage of justice. 415 Reasons of Heydon J at [339]. 416 Crampton v The Queen (2000) 206 CLR 161; [2000] HCA 60; reasons of Gleeson CJ at [36]; reasons of Kirby J at [50]; reasons of Hayne J at [207]; reasons of Heydon J at [360] n 310. Crennan OAE There was no substance in the complaint that the trial judge misdirected the jury on the standard of proof, as shown by Heydon J in his reasons417. The evidence of uncharged acts went to the jury for the limited purpose of showing a relationship between the accused and the complainant characterised by the "sexual attraction" of the accused to the complainant; the relationship was described to the jury as putting the offences in a proper context. As well as describing those limited purposes the trial judge directed the jury that the evidence could not be substituted for the direct evidence of the elements of the offences and he gave a warning against propensity reasoning. Those directions were adequate and did not give rise to any miscarriage of justice. Orders In each of HML v The Queen and SB v The Queen the appeal should be dismissed. Special leave to appeal should be granted in OAE v The Queen, the appeal treated as heard instanter but the appeal should be dismissed. 417 Reasons of Heydon J at [395]-[396]. 486 KIEFEL J. The facts relevant to each of these matters are set out in the reasons of Hayne J and Heydon J. In each matter the offences charged were the sexual assaults of and sexual intercourse with a child, by a parent in the cases of HML v The Queen418 and SB v The Queen419 and by the brother of the child's foster mother in OAE v The Queen420. In each matter the prosecution case relied upon the complainant's account. On each of those accounts the offences charged were not isolated incidents, but part of a course of conduct engaged in by the accused. In circumstances such as these it is generally regarded as impracticable to charge the accused with every alleged act. Particular occasions are selected as the subject of charges. In some jurisdictions an offence is defined, by statute, by reference to the maintenance of a sexual relationship with a child. It is proved by establishing a sexual act upon the child on a number of separate occasions in a specified period. The statutory provision in South Australia421 requires three separate occasions and came into force in 1994. It was not utilised in HML and OAE, there being only two charges in each, and could not apply in SB. Difficulties may arise in the prosecution of isolated acts if the evidence to be placed before the jury is restricted to the circumstances of the offences charged. Nevertheless, evidence concerning other offences or misconduct on the part of the accused must not only be relevant to a fact in issue with respect to the offences charged, but also qualify for admission in accordance with the rule of evidence concerning similar facts. Condition for admissibility It is a rule of evidence that evidence which tends to show the commission, by the accused, of criminal acts other than those covered by the indictment, tendered for the purpose of enabling a conclusion that the accused is a person likely, by reason of that conduct or the accused's character, to have committed the offences charged, be excluded422. The rationale for its exclusion, as a matter of legal policy, has its basis in the concern of the law as to the way in which the information might be used by a jury. The concern is not so much with the nature of the information, about the other offences or misconduct, as with the process of 418 R v H, ML [2006] SASC 240. 419 R v S, B [2006] SASC 319. 420 R v O, AE (2007) 172 A Crim R 100. 421 Criminal Law Consolidation Act 1935 (SA), s 74. 422 See Makin v Attorney-General for New South Wales [1894] AC 57 at 65. reasoning which the jury might apply to it423. The "forbidden reasoning"424, which might be employed by a jury, is to infer guilt where neither logic nor experience necessitates such a conclusion425. That is to say the jury may reason from what the other offences or misconduct convey about the accused as a person, directly to guilt. This may be more likely to occur where the other conduct is particularly reprehensible. Lord Goddard CJ in R v Sims426 suggested that it was preferable not to start with the assumption of the exclusion of all such evidence, but with the general proposition that all evidence that is logically probative is admissible unless it is excluded. This statement prefaced comments concerning the second limb of the rule as stated in Makin v Attorney-General for New South Wales427, which was once controversial428 but no longer assumes importance. The statement is undoubtedly correct. It focuses attention, in the first instance, upon the relevance of the evidence of the other misconduct, from which the importance attaching to the evidence may be gauged. The law does not deny that evidence of similar misconduct may have probative value with respect to a fact in issue. The exclusion is therefore qualified. The basic condition for admissibility, applied since Director of Public Prosecutions v Boardman429, is that evidence of this kind have such a strong probative force that it transcends the possible prejudice to the fair trial of the accused430. The prejudice referred to is the misuse by the jury of the evidence as earlier mentioned and does not arise from the strength of the evidence itself. It may be assumed that where there is a legally relevant basis for its use a jury, properly directed, will not employ forbidden reasoning. 423 Cross on Evidence, 7th Aust ed (2004) at [21030]. 424 Director of Public Prosecutions v Boardman [1975] AC 421 at 453 per Lord 425 Pfennig v The Queen (1995) 182 CLR 461 at 482 per Mason CJ, Deane and Dawson JJ; [1995] HCA 7. 426 [1946] KB 531 at 539. 428 Pfennig v The Queen (1995) 182 CLR 461 at 476-477 per Mason CJ, Deane and 430 Hoch v The Queen (1988) 165 CLR 292 at 300-301 per Brennan and Dawson JJ; [1988] HCA 50. The courts have recognised that some evidence may be such that it would be an "affront to common sense" to exclude it431. In Director of Public Prosecutions v P432 it was accepted that it may be just to admit evidence having a sufficiently great probative force, despite the fact that it may be prejudicial to the accused, in tending to show the accused was guilty of another crime433. The courts have permitted use of the propensity or tendency disclosed by the other conduct as circumstantial evidence in proof of the offences charged. Pfennig v The Queen434 was such a case. In admitting evidence of the accused's conviction, for the abduction and sexual assault of a boy, Mason CJ, Deane and Dawson JJ applied a test for admissibility which had regard to the character of the evidence as propensity evidence with "a prejudicial capacity of a high order"435. The test was that to be applied by a jury in determining guilt by reference to circumstantial evidence. It required the trial judge to be satisfied that there was no rational view of the evidence consistent with the innocence of the accused436. Their Honours said of the requirement437: "In stating the question in that way, we point out … that the purpose of the propensity evidence is to establish a step in the proof of the prosecution case, namely, that it is to be inferred, according to the criminal standard of proof, that the accused is guilty of the offence charged. Accordingly, the admissibility of the evidence depends upon the improbability of its having some innocent explanation in the sense discussed." It may be observed from their Honours' explanation that the reasoning employed is not propensity reasoning, in the sense of the forbidden reasoning earlier mentioned. It involves the use of propensity or tendency evidence but maintains conventional probability reasoning. 431 Director of Public Prosecutions v Boardman [1975] AC 421 at 456 per Lord Cross of Chelsea. 432 [1991] 2 AC 447 at 460 per Lord Mackay of Clashfern LC. 433 And see Director of Public Prosecutions v Boardman [1975] AC 421 at 439 per Lord Morris of Borth-y-Gest; Pfennig v The Queen (1995) 182 CLR 461 at 528 per 434 (1995) 182 CLR 461. 435 (1995) 182 CLR 461 at 482-483. 436 (1995) 182 CLR 461 at 482-483. 437 (1995) 182 CLR 461 at 484. Relevance It is not possible to discuss the probative force of evidence without identifying the way in which it may be used and the issue to which it relates. Cases dealing with offences of the kind here in question have identified more than one purpose for adducing evidence of the other sexual misconduct under the general heading of "relationship evidence". This has added to the confusion as to the appropriate standard to be applied for its admissibility. The term "relationship evidence" refers to all the conduct of a sexual kind that has taken place between the accused and the complainant. It encompasses sexual conduct which is an offence, often referred to as "uncharged acts", and misconduct which may not be an offence. It may not be desirable for a trial judge to describe the acts as "uncharged" to a jury, since it may convey a view, on the part of the judge, that they were proper subjects for charges. The characterisation of the evidence of the other sexual misconduct as "relationship evidence" may also be inapposite to describe the respective positions of the parties and the unilateral actions of the accused. Nevertheless it is a term which has been used for some time to describe the other evidence of sexual misconduct and I will maintain its use in these reasons, for consistency. Clearly, relationship evidence is relevant as showing the sexual interest of the accused in, or the "guilty passion" for, the complainant. Its relevance in this regard has been acknowledged by judges of this Court438 and by judges of State courts439. There can be little doubt about its probative force. It may reveal a tendency in the accused, sometimes described as a motive. Where the relationship evidence shows that the accused has carried out sexual acts upon the complainant, or undertaken acts preparatory to them, the tendency or propensity on the part of the accused may be taken as confirmed. It may be concluded that the accused is prepared to act upon the tendency to an extent that it may be inferred that the accused will continue to do so. The evidence may then render more probable the commission of the offences charged. 438 B v The Queen (1992) 175 CLR 599 at 601-602 per Mason CJ, 605 per Brennan J, 610 per Deane J, 618 per Dawson and Gaudron JJ; [1992] HCA 68; Gipp v The Queen (1998) 194 CLR 106 at 132 [76] per McHugh and Hayne JJ; [1998] HCA 439 R v AH (1997) 42 NSWLR 702 at 708 per Ireland J; R v Wackerow [1998] 1 Qd R 197 at 204 per Pincus JA; R v Nieterink (1999) 76 SASR 56 at 66 [48]-[49]; R v Vonarx [1999] 3 VR 618 at 622 [13]; Cook v The Queen (2000) 22 WAR 67 at 83 More difficulty attends the question as to the relevance of relationship evidence where it is used in a more general way, to provide a setting or context for the offences charged440. The perceived need for the evidence is that the charged acts may otherwise seem unreal and not very intelligible441. Professor Birch distinguishes "background evidence" from that tendered as similar facts. She emphasises the assistance it gives to the jury by putting them in the general picture. If it involves references to prior offences, it does so because an account would otherwise be incomplete or incoherent. It is not so much that it would be an affront to common sense to exclude the evidence, rather that it is helpful to have it and difficult for the jury to do their job if events are viewed in total isolation from their history, in her view442. A description of the work relationship evidence might do does not, however, complete the identification of its legal relevance. I do not understand the cases dealing with relationship evidence of the kind here in question to suggest that such evidence could be admitted as part of the res gestae. It could not be said to be relevant on account of being contemporaneous with the offences charged443. The inclusionary aspect of the res gestae doctrine, extending to bad disposition444, suggests that no wide view should be taken of evidence properly falling within it. As McHugh J reminded in Harriman v The Queen445, if evidence is characterised as part of the transaction charged, it is not subject to any further condition of admissibility. Some cases have admitted evidence of events extending beyond those proximate to the act charged on the basis that they make the act understandable and because the events are regarded as being bound up with the offence. On closer examination it may be thought that the evidence in question qualified as part of the res gestae. 440 See B v The Queen (1992) 175 CLR 599 at 610 per Deane J. 441 Gipp v The Queen (1998) 194 CLR 106 at 130 [72] per McHugh and Hayne JJ; KRM v The Queen (2001) 206 CLR 221 at 264 [134] per Hayne J; [2001] HCA 11; Tully v The Queen (2006) 230 CLR 234 at 278 [145] per Callinan J; [2006] HCA 56; R v Etherington (1982) 32 SASR 230 at 235 per Walters J; R v Wickham unreported, New South Wales Court of Criminal Appeal, 17 December 1991 per Gleeson CJ; R v Nieterink (1999) 76 SASR 56 at 65 [43] per Doyle CJ. 442 Commentary to case note on R v Stevens [1995] Crim LR 649 at 651. 443 Cross on Evidence, 7th Aust ed (2004) at [37001]. 444 Cross on Evidence, 7th Aust ed (2004) at [37001]. 445 (1989) 167 CLR 590 at 633; [1989] HCA 50. In O'Leary v The King446 evidence was admitted of the accused's drunken and violent conduct towards fellow employees on the day leading up to the murder of one such employee. Dixon J said that if the events of the day were not presented in evidence the murder would seem "an unreal and not very intelligible event". But his Honour also described them as a series of connected events which could be considered as one transaction447. Latham CJ said that the evidence made it possible to obtain a real appreciation of the events of the day and night, but also said that the events formed "constituent parts or ingredients of the transaction itself"448. McHugh J in Harriman449 appears to have viewed O'Leary as concerned with res gestae evidence. R v Bond450 is another case where the evidence was described generally as "necessarily admissible" and unable thereby rendered unintelligible"451. However, it was also described as involving acts "so closely and inextricably mixed up with the history of the guilty act itself as to form part of one chain of relevant circumstances"452, which may suggest that it was in truth viewed as part of the res gestae. to be excluded "without the evidence being It has been said that evidence may be admissible, in a general way, to show the true relationship between the parties453. More particularly, in cases of the kind in question, it may show that a sexual relationship exists454. Wilson v The Queen455 was a case where evidence was relevant to explain a relationship between husband and wife, on the trial of the husband for the murder of his wife. 446 (1946) 73 CLR 566; [1946] HCA 44. 447 (1946) 73 CLR 566 at 577. 448 (1946) 73 CLR 566 at 575. 449 (1989) 167 CLR 590 at 628-629; and see also R v Etherington (1982) 32 SASR 230 at 235 per Walters J. 451 [1906] 2 KB 389 at 400 per Kennedy J. 452 [1906] 2 KB 389 at 400 per Kennedy J. 453 KRM v The Queen (2001) 206 CLR 221 at 230 [24] per McHugh J. 454 R v Vonarx [1999] 3 VR 618 at 623 [15], 625 [21]-[22]; Gipp v The Queen (1998) 194 CLR 106 at 156 [141] per Kirby J. 455 (1970) 123 CLR 334; [1970] HCA 17. The evidence admitted showed the acrimony in their relationship, disclosed in particular by statements made by the wife as to her belief that her husband wished to kill her. Menzies J said that the evidence was admitted because the jury would want to know what the relationship was between the husband and wife, for otherwise they would be deciding the matter "in a vacuum"456. But the evidence was not relevant in some general way. It permitted an inference to be drawn, as to the husband's state of mind, such as might negative the prospect of an accidental shooting, which he had raised by way of defence. In cases of the kind presently under consideration evidence tendered to show the relationship between the parties would provide more than context. It would focus attention upon its sexual nature and the accused's role in its creation and continuance. It would invite inferences to be drawn about the accused's state of mind towards the complainant and therefore his tendency. This does not provide support for a more general role for the evidence. It may be accepted that relationship evidence has long been admitted for the explanation it provides to the jury457. In KRM v The Queen McHugh J said that it might explain why, on the occasions charged, the complainant did not rebuff the accused or showed no distress or resentment458. Cases involving sexual offences against children have identified other questions which are likely to occur to a jury and require explanation. They include: whether the offences are isolated incidents; why the accused felt confident enough to demand the acts in question; why the child was compliant; and why he or she did not make a complaint to another person459. The present case of HML provides another example. The jury would naturally be concerned to know whether any conduct of a sexual nature had preceded the alleged demands by the accused for fellatio and anal intercourse. They would wonder at, if not be concerned by, the complainant's apparent detachment in the way she described the circumstances of the offences. The evidence she gave, as to a statement made by the accused, makes the point. He encountered some difficulty with penetration when having anal intercourse with the complainant and commented that it had not happened 456 (1970) 123 CLR 334 at 344 per Menzies J, McTiernan and Walsh JJ agreeing. 457 KRM v The Queen (2001) 206 CLR 221 at 230 [24] per McHugh J. 458 (2001) 206 CLR 221 at 230 [24]. 459 Harriman (1989) 167 CLR 590 at 631 per McHugh J; Gipp v The Queen (1998) 194 CLR 106 at 113 [12] per Gaudron J, 131 [73] per McHugh and Hayne JJ; R v Etherington (1982) 32 SASR 230 at 235 per Walters J; R v Wickham unreported, New South Wales Court of Criminal Appeal, 17 December 1991 per Gleeson CJ; R v Josifoski [1997] 2 VR 68 at 77 per Southwell AJA; R v Wackerow [1998] 1 Qd R 197 at 209 per Byrne J; R v Nieterink (1999) 76 SASR 56 at 72 [76] per before. The complainant was able to explain that he had had intercourse of this kind with her on previous occasions. In my view relationship evidence is relevant, but not in a general way and not by way of background or contextual evidence. It is relevant to answer questions which, in cases of the kind under consideration, may fairly be expected to arise in the minds of the jury were they limited to a consideration of evidence of the offences charged. So understood the basis for its admission is not to bolster the complainant's credit. It is relevant to answer questions and thereby rebut or negative an inference which might otherwise be drawn by the jury. In Gipp v The Queen, McHugh and Hayne JJ accepted that general relationship evidence might be admitted for a limited purpose, one which did not rely upon the accused having a sexual interest in the complainant460. Relationship evidence tendered for this limited purpose does not depend, for relevance, upon a question being raised by the defence. Gaudron J in Gipp461 accepted that issues may arise as to the complainant's lack of surprise or failure to complain, but considered that they could only be raised by the defence. I must respectfully disagree. Gibbs ACJ in Markby v The Queen462 did not consider that the admissibility of evidence, relevant otherwise than as to tendency or propensity, depended upon the line taken by the defence at trial, that is, whether the accused had raised or disclaimed a particular defence463. The position of the defence may not be clearly exposed on cross-examination of the complainant. It may not be until addresses that reliance is placed upon gaps in the complainant's account. Even if the defence eschewed reliance upon what might be drawn from the absence of particular evidence from the complainant, it would not always be sufficient to settle a concern held by the jury. In any event, if it be accepted that the evidence is relevant to meet questions which may be fairly anticipated to occur to a jury, it cannot be seen as dependent upon the course taken by the defence. Propensity evidence and admissibility Relationship evidence tendered for the purpose of providing answers to the jury, in the way explained, discloses the other misconduct. It does not, however, involve the use of any tendency of the accused, in the reasoning of the 460 (1998) 194 CLR 106 at 131-132 [75]-[76]. 461 (1998) 194 CLR 106 at 113 [12]. 462 (1978) 140 CLR 108; [1978] HCA 29. 463 (1978) 140 CLR 108 at 116-117, referring to Harris v Director of Public Prosecutions [1952] AC 694 at 710. jury, so long as the jury are properly instructed. It will be necessary, where it is relied upon for this limited purpose, for the trial judge to carefully direct the jury as to the use they can make of the evidence464. In BRS v The Queen McHugh J acknowledged that a direction may be effective to overcome the potential for prejudice465. To achieve that it will be necessary that the jury be told that they must use the evidence only to answer the questions, identified at an early point by the prosecution and accepted as relevant by the trial judge, which are considered likely to occur to them; but that they are not to use it to reason that the accused is likely to have committed the offences. In some cases a trial judge might fairly observe that the reference to other acts, which are likely to be of the same kind as those charged, does not logically prove the prosecution case or enhance the complainant's credit. It must be accepted that relationship evidence may have dual purposes. Where it is tendered for both, the more stringent test for admissibility must necessarily be applied. If it is not tendered for the purpose of showing the accused's tendency it does not follow that it is inadmissible for the more limited purpose of informing the jury, according to general principles of the law of evidence. In Bull v The Queen, McHugh, Gummow and Hayne JJ said that the fact that evidence which is relevant and legally admissible on one issue, may be logically but not legally relevant to another issue, does not make the evidence inadmissible on the first issue466. When an exclusionary rule of evidence otherwise applies, the trial judge will need to warn that the evidence can be used for the admissible purpose and no other467. This rule of admissibility does not overcome the rule of exclusion, where it is shown that the risk of prejudice to the accused is far greater than the probative value of the relationship evidence. A risk of prejudice is most likely to arise, in cases of this kind, where specific, detailed incidents of other sexual misconduct are recounted by the complainant. The possibility must be accepted that there may be cases where the trial judge may consider that the risk cannot be negatived or limited to an acceptable degree by a direction. It is not possible to envisage the circumstances of every case. But it may be expected that in most cases the evidence necessary to answer the particular questions, identified as likely to occur to the jury, will be of a general nature. Evidence beyond that 464 BRS v The Queen (1997) 191 CLR 275 at 305-306 per McHugh J; [1997] HCA 47; Gipp (1998) 194 CLR 106 at 156 [141] per Kirby J. 465 (1997) 191 CLR 275 at 310. 466 (2000) 201 CLR 443 at 463 [68]; [2000] HCA 24. 467 Bull v The Queen (2000) 201 CLR 443 at 463 [69], referring to B v The Queen (1992) 175 CLR 599 at 619. necessary to answer the question would exceed the bounds of relevance. However, in some cases the evidence may be so general as to be objectionable on that account468. In Gipp, McHugh and Hayne JJ expressed the view that relationship evidence tendered for the limited purpose did not offend the policy of the law upon which the rule of exclusion is based469. I respectfully agree. The direction to the jury prohibits its use as evidence of tendency and it is therefore to be distinguished from other similar fact evidence470. In Pfennig it was said in the joint judgment that relationship evidence is a type of propensity evidence471. I take their Honours to mean that this is so when it is used as propensity evidence. In that situation it belongs to a special class of circumstantial evidence which may attract the test there propounded472. The test applied in Pfennig can have no application to the limited purpose here discussed. It has been assumed that the test did not apply473. In Conway v The Queen relationship evidence was considered to fall outside the special rules in Pfennig, because Pfennig dealt with the more difficult and dangerous category of similar fact evidence474. The admission of relationship evidence to show the accused's sexual interest in the complainant clearly involves use of the accused's tendency to engage in acts with the complainant such as those charged. Where the accused has already offended that propensity or tendency may be taken as showing a preparedness on the part of the accused to act upon it and to continue to act upon it. It is to be recalled that in cases such as this there is usually no independent evidence to prove the acts relied upon as relationship evidence. It is for the jury to determine whether all, or some, of the evidence is acceptable for the purpose suggested by the prosecution, assuming for present purposes that they do not accept the direct evidence of the offences given by the complainant as itself sufficient. A finding of propensity on circumstantial evidence is one as to an 468 Gipp (1998) 194 CLR 106 at 132 [75] per McHugh and Hayne JJ. 469 (1998) 194 CLR 106 at 134 [84] per McHugh and Hayne JJ. 470 Gipp (1998) 194 CLR 106 at 112-113 [11] per Gaudron J. 471 (1995) 182 CLR 461 at 464-465 per Mason CJ, Deane and Dawson JJ. 472 (1995) 182 CLR 461 at 482-483. 473 KRM v The Queen (2001) 206 CLR 221 at 233 [31] per McHugh J; R v Nieterink (1999) 76 SASR 56 at 66 [49] per Doyle CJ; R v Vonarx [1999] 3 VR 618 at 622 474 (2000) 98 FCR 204 at 233 [95]. intermediate fact. In the ordinary course a jury would be instructed by the trial judge that they must only find that the accused has a sexual interest in the complainant if it is proved beyond reasonable doubt475. From that point they may consider that it is more probable that the accused committed the offences. The more difficult question, when relationship evidence is tendered for this purpose, is whether the test for admissibility in Pfennig must be applied to it before it is put before the jury. As the passage from the joint judgment in Pfennig earlier referred to476 shows, the rationale for the test is that propensity is applied directly to a step in proof of the prosecution case. There it was to be used to remove any question about the identification of the accused as the person who committed the murder and thereby to conclude guilt. In cases such as the present matters its use, and the process of reasoning in which the jury are involved, is different. The identifiable step is proof of propensity itself which, by reason of the nature of the cases, may leave little to add to the evidence of the commission of the offences themselves to conclude the question of guilt. The use of the accused's tendency or propensity in Pfennig was relatively straightforward, although uncommon. The evidence in question showed that the accused had abducted a boy on another occasion, for sexual purposes. The tendency may have been in operation at the time of the murder of the boy in question. Absent this evidence the prosecution could prove only that the boy had been abducted and that he had met and talked with the accused near the scene of his disappearance. The fact of the boy's murder was to be inferred. The critical issue before the jury was the identity of the murderer, as the joint judgment acknowledged477. The abnormal propensity of the accused was, clearly enough, regarded as admissible as an indicium of identity. This is similar to the use made of the accused's propensity in Thompson v The King478. The accused's propensity in Pfennig excluded the possibility of another person being the murderer, although this result is perhaps not clearly stated. It may be inferred that that was the only innocent explanation thought necessary to be excluded. That left no rational view of the evidence as a whole consistent with the accused's innocence. The evidence was therefore admissible. The joint judgment in Pfennig spoke, at various points and in a general way, of the application of the test to cases involving similar facts. Cases 475 Shepherd v The Queen (1990) 170 CLR 573; [1990] HCA 56; and see Gipp (1998) 194 CLR 106 at 132 [76] per McHugh and Hayne JJ. 476 See above at [489]. 477 (1995) 182 CLR 461 at 475 per Mason CJ, Deane and Dawson JJ. involving the use of relationship evidence as disclosing propensity were not, however, the subject of discussion in the reasons. The submissions for each of the accused in the present matters did not suggest that the Pfennig test should not be applied because that decision was wrongly decided. They assumed that the test had no application to cases of this kind. How that was so was not fully investigated. Nevertheless it seems plain enough that the circumstances of these cases are very different from those pertaining in Pfennig, as is the use to which the evidence is to be put and the reasoning in which the jury would be engaged. These considerations raise the question whether the test is necessary and whether it could have any real practical operation. The starting point in the application of the Pfennig test, in cases involving relationship evidence, is the assumption, on the part of the trial judge, that there is a reasonable doubt arising from the prosecution case absent the relationship evidence. The enquiry undertaken by the trial judge, for admissibility, is whether there remains any explanation consistent with innocence when the evidence of the accused's propensity is applied. The second assumption necessary to be made, in cases such as these, is that the jury will accept the relationship evidence in full, which of course they may or may not do, depending on the view taken of the complainant's credit and the plausibility of her account. At this point the relationship evidence may be applied in order to determine whether there is an explanation which might be consistent with the accused's innocence, that is to say whether the reasonable doubt remains. When applied to cases involving relationship evidence which shows the accused's propensity in relation to the complainant there will rarely be a case where an innocent explanation is left. This result will be brought about because evidence of the offences themselves will largely be indistinguishable from the acts the subject of the relationship evidence. The reason that the relationship evidence is highly probative is because it is of the same type and it is specifically directed towards the complainant. It is used to establish the accused's propensity and then to reason as to the likelihood of the commission of the offences. It may be contrasted with the situation in Pfennig, where the evidence was of a general propensity, towards boys, and it was used to identify the accused as the murderer. If the rule were to be applied, I respectfully agree with the view, stated by each of Gleeson CJ479, Hayne J480 and Heydon J481, that the evidence in each of the three matters would pass the test. In my view, however, that largely follows because the test is somewhat artificial, and therefore not very useful, in its application to cases of this kind. 479 Reasons of Gleeson CJ at [27]. 480 Reasons of Hayne J at [171], [216] and [234]. 481 Reasons of Heydon J at [287], [364] and [387]. Summary as to admissibility In my view relationship evidence is admissible for two purposes. It is admissible to show the sexual interest the accused had in the complainant at the time of the commission of the offences. That tendency, if proved, will in most cases make it likely that the accused committed the offences. The jury will require the usual directions with respect to the use of circumstantial evidence and clear directions as to proof of the sexual interest as an intermediate fact. The need for and practical effect of the test for admissibility referred to in Pfennig does not suggest its application in cases such as these as obvious. If applied, the evidence in these cases would qualify for admissibility in accordance with that test. Relationship evidence is also admissible for the more limited purpose of providing answers to questions which might naturally arise in the minds of the jury, such as questions about the complainant's reaction, or lack of it, to the offences charged, or questions about whether the offences charged were isolated events. These examples are not exhaustive. It follows that no more evidence than is necessary to answer the enquiry could be considered relevant. Admissibility for this purpose is conditioned by the requirement of a direction to the jury as to the limits on the use to which the evidence can be put. Where the direction is not considered sufficient to overcome the potential for misuse of the evidence, perhaps because of the nature of the evidence, it should not be admitted on this ground. Determination of the cases Details of the summings up in each of the three cases are provided in the reasons of Hayne J, Heydon J and Crennan J. The directions provided by the trial judge were consistent with the use of the relationship evidence for the limited purpose discussed. His Honour the trial judge identified it as providing background and an explanation as to why the accused was confident enough to demand oral sex and have intercourse with the complainant, and why she acquiesced. Insofar as the existence of a relationship was said to be disclosed by the evidence, its relevance was attached to the question about what it might explain about the circumstances of the offences. The fact of the accused having a sexual interest in the complainant was, in any event, governed by his Honour's direction requiring proof to the criminal standard. His Honour gave warnings about the use of propensity reasoning. The fact that no charges had been laid in Victoria, with respect to some of the acts forming part of the relationship evidence, was irrelevant and nothing more was required to be said by his Honour about that. Leave to amend the notice of appeal should be granted and the appeal dismissed. SB v The Queen Leave to amend the notice of appeal should be refused because it raises matters with respect to evidence which was not the subject of objection at trial. The trial judge explained to the jury that the evidence was relevant only to assist them in understanding how a particular incident came about and gave a strong warning against the use of it as evidence of the accused's propensity. The directions were appropriate and sufficient. This appeal should be dismissed. OAE v The Queen This matter requires special leave to appeal. That leave should be granted. The trial judge directed the jury that the evidence showed the nature of the relationship between the accused and the complainant. More specifically, his Honour explained that its purpose was to show that the event the subject of the second and third offences charged, which took place some four years after the first, would have otherwise appeared to have "happened out of the blue, so to speak". No reliance was placed upon the evidence as disclosing the accused's sexual interest. His Honour in any event directed the jury, in clear terms, not to use the evidence to reason to the guilt of the accused by reference to what it disclosed about the accused. The directions were sufficient. The appeal should be dismissed.
HIGH COURT OF AUSTRALIA APPELLANT AND RENE RIVKIN RESPONDENT John Fairfax Publications Pty Ltd v Rivkin [2003] HCA 50 10 September 2003 ORDER 1. Appeal allowed. 2. Order that there be a new trial on imputations 1(a), 1(b), 3(c)(i), 3(c)(ii), and On appeal from the Supreme Court of New South Wales Representation: B W Walker SC with T D Blackburn and A T S Dawson for the appellant (instructed by Freehills) T E F Hughes QC with T D F Hughes for the respondent (instructed by Gilbert & Tobin) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS John Fairfax Publications Pty Ltd v Rivkin Defamation – Appeal – Where jury found that matter did not convey any of the imputations pleaded – Whether jury's findings on particular imputations were ones which no reasonable jury properly instructed could reach – Scope of new trial where some only of the jury's findings were unreasonable. Practice and procedure – Order of addresses – Where plaintiff addressed jury first and defendant followed – Where trial judge refused plaintiff leave to address in reply – Whether trial judge erred in exercise of discretion – Whether order of addresses governed by rules of court or inherent jurisdiction of court. Appeal – Defamation – Whether jury's findings on alleged imputations were ones which no reasonable jury properly instructed could reach – Relevance of brevity of jury's retirement and universally unfavourable answers to alleged imputations. Defamation Act 1974 (NSW), s 7A. Supreme Court Act 1970 (NSW), s 102. GLEESON CJ. The facts are set out in the reasons for judgment of Callinan J, with which I agree. I would make the following additional observations. The issue before the Court of Appeal was fairly expressed in the notice of appeal to that Court as being whether each of the answers given by the jury to the questions submitted was an answer that no reasonable jury properly directed could have given. It is not uncommon, and not inappropriate, for judicial reference to such an issue to be accompanied by admonitions intended to remind appellate courts of a need for restraint. Sometimes such restraint is said to be necessitated by a practical consideration: juries, unlike trial judges sitting alone, do not give reasons for their decisions, and their decisions are, to that extent, unexaminable. Sometimes it is said to reflect deference to the constitutional role of the jury, and to its representative function. In defamation actions in New South Wales, that function is now considerably restricted, but at least it survives to the limited extent exemplified in the present appeal. It is to the practical consideration that I wish to return. Comments about the difficulty of challenging a jury's decision are often made in a context in which the jury has returned a single inscrutable verdict. That is not quite the present case. Here the jury gave answers to a number of questions. In each case, the question was divided into two parts: whether the matter published by the appellant of the respondent conveyed a certain imputation; and, if so, whether the imputation was defamatory. The jury returned a negative answer to the first part of each question. As the reasoning of the Court of Appeal demonstrates, the strength of the respondent's case in relation to the alleged imputations varied. The most serious alleged imputation was that the respondent was criminally liable in respect of the murder of a young woman whose body was found at the base of a cliff. The finding that the matter published did not convey that imputation was reasonably available to the jury. The articles treated the whole matter of the young woman's death as a mystery. The possibility that she was the victim of homicide, was presented as an open question. It appeared from the articles that the respondent had never even been questioned by the police about the matter. On the other hand, the jury's answer in relation to another of the imputations presents a challenge even to the most adroit rationalisation. One of the publications, in the course of paragraphs bearing the headline "Death of a Model", reported an unqualified and uncontradicted assertion that the deceased was suspicious of the respondent because he "used to hang out with a whole stack of people at [a] cafe which ... has a reputation for being a hangout for ex-drug dealers ... [and] [s]ome of [the respondent's] closest cronies are ... have certain criminal backgrounds or are rumoured to have it". The pleaded imputation was that the respondent was a close associate of criminals. The negative answer to the question whether the matter published conveyed that imputation is, to use a familiar simile, like the thirteenth stroke of a clock: not only wrong in itself; but such as to cast doubt on everything that went before1. While the same test is to be applied to each answer - whether it was an answer that no reasonable jury properly directed could have given - restraint on the part of an appellate court is likely to wane when one of the answers is of that quality. When an appellate court is reviewing a trial judge's findings of fact, it may conclude that a particular finding is so glaringly improbable that the level of scrutiny to which all the findings are to be subjected should be intensified. Put another way, the benefit of a doubt that might be given to a trial judge's findings in one context might be forfeited in another. The same may happen if, because a jury has answered a number of questions, there is a better than usual opportunity to assess its form. It does not follow, however, that it is unnecessary to deal with the appellate challenge, on its merits, in the case of each individual answer. In the present case, the Court of Appeal so completely lost confidence in the manner in which the jury addressed its task that the Court concluded that there should be a new trial on all questions. That was partly because the Court of Appeal took a more favourable view of some aspects of the respondent's case than I would take. What is said above in relation to the murder imputation is an example. I agree that there is no basis for interfering with the trial judge's discretionary decision as to the order of address by counsel. I agree with the orders proposed by Callinan J. 1 Hardy, Far from the Madding Crowd, (Claremont Classics 1999) at 183; Herbert, Uncommon Law (Eyre Methuen 1977) at 28. McHugh 10 McHUGH J. The principal issue in this appeal is whether the Court of Appeal of the Supreme Court of New South Wales erred in holding that no jury could reasonably find that two publications sued upon as being defamatory of the plaintiff did not contain certain imputations concerning him. If the Court of Appeal did not err in so holding, a second issue arises. It is whether that Court erred in holding that there should be a general new trial concerning all imputations pleaded in respect of those articles and another article even though the Court held that the jury acted reasonably in finding that the articles did not contain many of the imputations pleaded. In my opinion, the Court of Appeal erred in holding that no reasonable jury could find that the two articles did not contain the relevant imputations. Statement of the case Rene Rivkin, "a stockbroker, a company director and a prominent member of the business and financial community in Australia", sued John Fairfax Publications Pty Limited for damages for defamation in the Supreme Court of New South Wales. He sued on three separate publications. The first was an article in The Australian Financial Review dated 21-22 February 1998. The second was an article in The Sydney Morning Herald dated 25 February 1998. The third was an article in The Sydney Morning Herald dated 5 March 1998. He alleged that each of these articles, in their natural and ordinary meaning, contained defamatory imputations against him. He also alleged that the article of 25 February 1998 had an extended meaning (a true innuendo) to those persons who had read The Australian Financial Review article. John Fairfax admitted that it had published the articles and that at least one person who read the article of 25 February 1998 had also read The Australian Financial Review. But it denied that the articles contained the imputations that Mr Rivkin alleged or that the imputations were defamatory. In accordance with the requirements of s 7A of the Defamation Act 1974 (NSW), a jury was empanelled and asked to answer a series of questions as to whether the articles contained the imputations alleged and, if so, whether they were defamatory. Because of the limited role of the jury in such a proceeding, no oral evidence was called. Indeed, the only evidence before the jury were copies of the three articles. After a retirement of two hours, the jury held that Mr Rivkin had not established that any of the articles contained any of the imputations alleged. It made no findings as to whether or not those imputations were defamatory, if they had been made. As a result of the jury's answers, the trial judge entered a verdict for John Fairfax. Mr Rivkin appealed to the Court of Appeal of New South Wales against the entry of the verdict for John Fairfax. His principal ground of appeal was that "each of the answers given by the jury to the questions submitted to them was an McHugh answer that no reasonable jury properly directed could have given." The Court of Appeal (Grove J, with whom Meagher JA and Foster AJA agreed) held that nine answers given by the jury were reasonably open to them but that no jury could reasonably have given six of the answers. Despite finding that nine of the jury's answers were reasonable, the Court ordered a new trial on all questions. It did so for two reasons. First, the Court held that Mr Rivkin's counsel should have been given a right of reply to the address of counsel for John Fairfax. Secondly, it held that the "constant rejection of the cause of a litigant in many cases in defiance of reasonableness" indicates "that the jury has misapplied itself to its task." By special leave, John Fairfax now appeals to this Court against the orders of the Court of Appeal and asks that the order for a new trial of the action be set aside and the verdict entered at the trial be restored. Setting aside a civil jury's verdict In determining whether a civil jury acted reasonably in reaching its verdict, an appellate court must approach the case on the basis most favourable to the respondent to the appeal. The question for the appellate court is not whether the verdict is right or appears to be right but whether in the light of the evidence the verdict shows that the jury failed to perform its duty2. As long as the verdict cannot be described as irrational, it must stand3. As Else-Mitchell J pointed out in Carr v Sydney City Council4, an appellate court is not entitled to set aside a jury's verdict because the court regards the verdict "as illogical, unsatisfactory or different from that which it would itself have reached". These principles apply to appeals in defamation actions as well as to appeals in other common law actions5. Because the issue of libel or no libel is usually a matter of "impression"6, however, appellate courts set aside the ground of unreasonableness, even less frequently than they set them aside in other actions. The need for restraint is heightened by the knowledge that the meaning of a jury verdicts on 2 Mechanical and General Inventions Co v Austin [1935] AC 346; Hocking v Bell (1945) 71 CLR 430 at 498-499; Coyne v Citizen Finance Ltd (1991) 172 CLR 211 3 David Syme & Co v Canavan (1918) 25 CLR 234 at 239. (1963) 80 WN (NSW) 397 at 404. 5 Christie v Robertson (1889) 10 LR (NSW) 157 at 160; Ryan v Ross (1916) 22 CLR 6 Lewis v Daily Telegraph [1964] AC 234 at 260 per Lord Reid. McHugh publication and whether it is defamatory depends on whether ordinary reasonable readers would think it had the meaning alleged and, if so, whether that meaning is defamatory. It is for the jury to say what the words of the publication would mean "to ordinary men and women going about their ordinary affairs"7. Juries are more likely than judges to be able to assess the reactions of ordinary reasonable readers. At all events, the collective impression of a jury is more likely to be representative of the community's impression of the publication than the collective impression of a panel of appellate judges, however experienced or learned the panel may be. The New South Wales Parliament has certainly taken that view. In that State, judges decide every issue in a defamation action except meaning and defamation. Given the enactment of s 7A of the Defamation Act, the need for appellate restraint is even greater now than it was in 1990 when Kirby P said "judges must exercise care and restraint in invading the functions reserved by Parliament to juries"8. Occasions for invading the jury's function occur even less frequently when the jury has found that a publication is not defamatory. Rarely have appellate courts set aside a jury's finding that a publication was not defamatory. So rarely has it been done that in 1928 in Lockhart v Harrison9, Lord Buckmaster could say "such cases occur so rarely that within the last century there are only two to which our attention has been drawn in which this power has been exercised." There have not been many since. It is only when the publication contains a "plain and obvious defamation incapable of any innocent explanation"10 or where the words are "necessarily"11 defamatory that an appellate court is entitled to find that no reasonable jury could have failed to find the meaning alleged or that it was defamatory. As Chief Justice Darley observed in Kelly v Daily Telegraph Newspaper Co12, if the words of the publication have "any possible construction which can be put upon them, susceptible of an innocent meaning, then the verdict of the jury for the defendants 7 Lewis v Daily Telegraph [1964] AC 234 at 266 per Lord Morris of Borth-y-Gest. 8 Hanrahan v Ainsworth (1990) 22 NSWLR 73 at 88. (1928) 139 LT 521 at 523. 10 Lockhart v Harrison (1928) 139 LT 521 at 523. 11 Geach v Hall (1890) 16 VLR 386 at 389, 391, 392; Blashki v Smith (1891) 17 VLR 634 at 636, 638; Rofe v Smith's Newspapers Ltd (1927) 27 SR (NSW) 313 at 316, PC; Thompson v Truth & Sportsman Ltd (No 1) (1929) 31 SR (NSW) 129 at 134- 12 (1897) 18 LR (NSW) 358 at 361. McHugh is conclusive and cannot be disturbed." Hence, an appellate court can set aside a verdict of no libel on the ground of unreasonableness only when the words of the publication are not capable of any but a defamatory meaning13. Only when the defamation is "clear and beyond argument"14 can an appellate court set aside a jury's finding that the publication does not have the meaning alleged or that the meaning alleged is not defamatory. Mr Hughes QC, counsel for Mr Rivkin, argued – faintly I thought – that, because the appeal was brought to the Court of Appeal under s 102 of the Supreme Court Act 1970 (NSW)15, his client "did not have to surmount such a high bar" to have the jury's answers set aside. Mr Hughes argued that the appeal was "an appeal stricto sensu" and was not comparable with "the common law remedy of motion for a new trial in the exercise of a common law court's supervisory jurisdiction." The short and obvious answer to these contentions is that the principles to which I have referred have been applied, if they have not been developed, for more than a century by appellate courts hearing appeals under statutory enactments16. Accordingly, if the articles have rational meanings other than those asserted by Mr Rivkin, the jury's answers to the questions must be upheld and its verdict restored. Similarly, the jury's answers to any particular question must stand unless the article can have no meaning other than that contended for by Mr Rivkin. 13 Doyle v McIntosh (1917) 17 SR (NSW) 402. 14 Broome v Agar (1928) 138 LT 698 at 702; Cairns v John Fairfax & Sons Ltd [1983] 2 NSWLR 708 at 716-717. 15 "Where, in any proceedings in the Court, there is a trial of the proceedings or of any issue in the proceedings with a jury, an application for: a new trial ... shall be by appeal to the Court of Appeal." 16 See eg Capital and Counties Bank v Henty (1882) 7 App Cas 741; Nevill v Fine Art and General Insurance Co Ltd [1897] AC 68; Lockhart v Harrison (1928) 139 LT 521; Ryan v Ross (1916) 22 CLR 1. McHugh The tests for meaning and defamation Traditionally, courts have accepted that juries are more likely to find a publication defamatory than a judge. Lord Devlin famously said17: "[T]he layman's capacity for implication is much greater than the lawyer's. The lawyer's rule is that the implication must be necessary as well as reasonable. The layman reads in an implication much more freely; and unfortunately, as the law of defamation has to take into account, is especially prone to do so when it is derogatory." Consequently, for the purposes of a defamation action, the natural and ordinary meaning of words contains "all such insinuations and innuendoes as could reasonably be read into them by the ordinary man"18. Lord Reid said19: "The ordinary man does not live in an ivory tower and he is not inhibited by a knowledge of the rules of construction. So he can and does read between the lines in the light of his general knowledge and experience of worldly affairs." A reader may be acting reasonably even though he or she engages in "a certain amount of loose thinking"20. This is because, as Lord Reid also pointed out21: "The ordinary reader does not formulate reasons in his own mind: he gets a general impression and one can expect him to look again before coming to a conclusion and acting on it. But formulated reasons are very often an afterthought." 17 Lewis v Daily Telegraph [1964] AC 234 at 277. 18 Lewis v Daily Telegraph [1964] AC 234 at 280 per Lord Devlin. 19 Lewis v Daily Telegraph [1964] AC 234 at 258. 20 Morgan v Odhams Press Ltd [1971] 1 WLR 1239 at 1245; [1971] 2 All ER 1156 at 1163; Steele v Mirror Newspapers Ltd [1974] 2 NSWLR 348 at 373; Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 641; Farquhar v Bottom [1980] 2 NSWLR 380 at 386. 21 Morgan v Odhams Press Ltd [1971] 1 WLR 1239 at 1245; [1971] 2 All ER 1156 at 1163; Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 641. McHugh However, although a reasonable reader may engage in some loose thinking, he or she is not a person "avid for scandal"22. A reasonable reader considers the publication as a whole23. Such a reader tries to strike a balance between the most extreme meaning that the words could have and the most innocent meaning24. The reasonable reader considers the context as well as the words alleged to be defamatory25. If "[i]n one part of [the] publication, something disreputable to the plaintiff is stated, but that is removed by the conclusion; the bane and antidote must be taken together.26" But this does not mean that the reasonable reader does or must give equal weight to every part of the publication27. The emphasis that the publisher supplies by inserting conspicuous headlines, headings and captions is a legitimate matter that readers do and are entitled to take into account28. Contrary statements in an article do not automatically negate the effect of other defamatory statements in the article29. The rule that the publication must be read as a whole is particularly important where the publication reports a defamatory statement by a third party. The general rule is that a person who publishes the defamatory statement of a third party adopts the statement and has the same liability as if the statement originated from the publisher30. Accordingly, it is not the law that a person 22 Lewis v Daily Telegraph [1964] AC 234 at 260. 23 Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 646; Australian Broadcasting Corporation v Comalco Ltd (1986) 12 FCR 510; Morosi v Broadcasting Station 2GB [1980] 2 NSWLR 418(n). 24 Lewis v Daily Telegraph [1964] AC 234 at 259-260. 25 Nevill v Fine Art and General Insurance Co Ltd [1897] AC 68 at 72, 78; English and Scottish Co-operative Properties Mortgage & Investment Society Ltd v Odhams Press Ltd [1940] 1 KB 440 at 452. 26 Chalmers v Payne (1835) 2 Cr M & R 156 at 159 [150 ER 67 at 68]; Bik v Mirror Newspapers Ltd [1979] 2 NSWLR 679 at 682, 683-684; Monte v Mirror Newspapers Ltd [1979] 2 NSWLR 663 at 671. 27 Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 646. 28 Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 646. 29 Savige v News Ltd [1932] SASR 240; Hopman v Mirror Newspapers Ltd (1960) 61 SR (NSW) 631; Sergi v Australian Broadcasting Commission [1983] 2 NSWLR 30 "Truth" (NZ) Ltd v Holloway [1960] 1 WLR 997 at 1002-1003. McHugh reporting the defamatory statement of another is only liable if he or she adopts the statement or reaffirms it31. But, as Griffith CJ pointed out in Ronald v Harper32, although as a general rule a person who repeats a defamation adopts it as his or her own statement, it is not "a rule of invariable application". The context of the statement may show that it is refuted or undermined by other parts of the publication. In Bik v Mirror Newspapers Ltd33, the plaintiff claimed that he was defamed by a report of parliamentary proceedings that disclosed that a witness at a coronial inquiry had alleged that the plaintiff had designed a faulty crane that led to a fatality. But the report also stated that, in answer to a question, the Minister of Justice "completely cleared"34 the plaintiff. The New South Wales Court of Appeal unanimously held that the report was incapable of a defamatory meaning concerning the plaintiff. The above principles and considerations are as relevant in determining whether the jury's answers in the present case were reasonable as they are when a court has to consider whether words are capable of a defamatory meaning. But in a case where the jury has returned a finding of no imputation or no libel, they have less force than in a case where the jury has found the defamatory meaning alleged and pleaded. They indicate the outer limits of meaning and defamation; they give far less assistance in determining whether the jury was bound to find the defamatory meaning alleged and pleaded. The Australian Financial Review article of 21-22 February 1998 The Australian Financial Review article, like the two articles in The Sydney Morning Herald, was concerned with the death of Ms Caroline Byrne whose body, according to the articles, was found at the foot of a 30 metre cliff at The Gap "a well-known Sydney suicide spot, almost three years ago." Mr Rivkin alleged that The Australian Financial Review article contained four imputations. The Court of Appeal held that it was open to the jury to find reasonably that the article did not have two of the imputations pleaded. But it held that it was unreasonable for the jury to find that the article did not have the other two imputations pleaded. Those two imputations were: "1(a) that the Plaintiff's participation in the affairs of Offset Alpine Press Group had diminished his reputation as a sagacious and astute stockbroker; 31 Wake v John Fairfax & Sons Ltd [1973] 1 NSWLR 43 at 49-50. 32 (1910) 11 CLR 63 at 77. 33 [1979] 2 NSWLR 679. 34 [1979] 2 NSWLR 679 at 681. McHugh that in May 1995 the Australian Securities Commission had reason to suspect that the Plaintiff had engaged in unlawful conduct in connection with the affairs of Offset Alpine Press Group." Imputation 1(a) The Australian Financial Review article stated that the Senior Deputy State Coroner had returned an open verdict on Ms Byrne's death "finding that she either jumped, slipped or was pushed from the top of the cliff on the night of June 7, 1995." The article was headed "It's a BAD BUSINESS". Above that headline was a drawing outlining a body lying prostrate. The outline and the heading occupied about 75 per cent of the page. The article stated that Ms Byrne had been referred to a psychiatrist by her general practitioner two days before her death "complaining of depression, though the doctor stressed at the inquest that she did not feel Byrne was suicidal." It went on to state that inquiries by The Australian Financial Review raised the possibility that an Australian Securities Commission interrogation of her boyfriend the day before her death may have contributed to her depression. The boyfriend was identified as Mr Gordon Wood. The article said that on May 31 1995, Wood and his employer, "high-profile investor Rene Rivkin", had been served with an order by the Australian Securities Commission "to submit to a formal examination by an ASC legal team." It claimed that the Australian Securities Commission had questioned Wood and Rivkin on 6 June "over the recent trip the two had taken to Zurich, and in connection with its investigation of secret holdings in Rivkin's Offset Alpine Press Group by mystery Swiss investors." The article said that, during Wood's employment, Mr Rivkin's fortunes were on the rise and that he had controlled Offset Alpine, a public company, since the 1980s. But it said that, although the company was virtually moribund by 1992, on two occasions since then its share price had been galvanised. It then stated: "But Rivkin's reputation as a canny and astute broker took a battering in May 1995 when the ASC took legal action to freeze a major part of Offset Alpine's share register." This paragraph is central to Mr Rivkin's claim that the article contained imputation 1(a). But the imputation differs in a major respect from the text of the article. The imputation asserts that the plaintiff's participation in the affairs of Offset Alpine "had diminished his reputation as a sagacious and astute stockbroker". The jury were entitled to take the view that this imputation meant that, as at the date of the article – 21-22 February 1998 – Mr Rivkin's reputation as a sagacious and astute stockbroker had been diminished by his participation in the affairs of Offset Alpine. But the relevant paragraph said no more that his reputation as a canny and astute broker had taken a battering in May 1995. It said nothing as to whether the battering had resulted in any permanent McHugh diminution of his reputation. Moreover, other parts of the article suggested that Mr Rivkin had been cleared of any wrongdoing. The article expressly stated: "No charges were ever laid, and no negative aspersions were ever drawn about any of those investigated by the ASC." The article was also open to the construction that the investigation into Mr Rivkin had been the product of a mistaken communication by Mr Phillip Croll, the Managing Director of his broking house to the Australian Stock Exchange. The article declared: "After the ASC froze the shares on May 3, Croll told the ASC that he had misunderstood the relationship, and that Rivkin did not control the accounts. 'I think you'll find that a little bit of knowledge can be a dangerous thing,' Croll told the AFR on May 9 about his mistake. This would have been a tense time for all concerned. It was difficult for the Swiss companies, which were forbidden by Swiss law from disclosing the real identity of their clients. It was tense for the real owners of the shares, who were risking the loss of their entire investment to the ASC by instructing the Swiss companies not to name them. It also must have been a tense time for Rivkin and his personal assistant Gordon Wood, not merely because it now seemed that, unbeknownst to Rivkin, his company had had a covert takeover, but also because thanks to Croll's misunderstanding Rivkin himself had become a major focus of the ASC inquiry." (emphasis added) Because of these two matters – no reference to permanent diminution and Croll's misunderstanding – it was open to the jury to conclude that the article did not carry an imputation that Mr Rivkin's "participation in the affairs of Offset Alpine Press Group had diminished his reputation as a sagacious and astute stockbroker." The Court of Appeal's discussion of this imputation was brief. "The argument of [John Fairfax] provided no answer to that of [Mr Rivkin] as it was based upon construction of a selected portion only of the matter complained of." The discussion did not refer to any of the matters to which I have referred as indicating that it was open to the jury to conclude that the article did not bear the imputation alleged. The Court of Appeal erred in holding that the jury's negative answer to this imputation was unreasonable. McHugh Imputation 1(b) Imputation 1(b) was cleverly drawn to anchor its content to May 1995. No doubt that month was chosen because it was during that month that Mr Rivkin – according to the article – was summonsed for a Section 19 examination. However, the article does not state in terms that the Australian Securities Commission suspected that Mr Rivkin "had engaged in unlawful conduct in connection with the affairs of Offset Alpine Press Group". And the jury were entitled to reject the proposition that this imputation arose by inference or insinuation. Immediately after the paragraph stating that "Rivkin's reputation as a canny and astute broker took a battering in May 1995", the article declared that, in the Federal Court on 3 May 1995, the Australian Securities Commission had revealed that the major beneficiaries of Offset Alpine's change in fortune were two Swiss companies. The article said that those companies "by ignoring Australian reporting requirements, secretly owned 38 per cent of the company, hidden in five Australian nominee companies (which, like Rivkin, were unaware of the size of the total holding)." Because of this statement, it was reasonably open to the jury to take the view that the Australian Securities Commission had summonsed Rivkin to investigate the circumstances of the Swiss companies and his knowledge of their activities. The jury were not bound to find that the Australian Securities Commission "had reason to suspect that the Plaintiff had engaged in unlawful conduct in connection with the affairs of Offset Alpine Press Group". That was a construction that was open to the jury, but it was not a necessary construction of the article as a whole. In Lewis35, Lord Morris of Borth-y-Gest pointed out that it "is a grave thing to say that someone is fraudulent". It is also "a grave thing to say" that the controller or an officer of a public company has engaged in unlawful conduct in relation to the affairs of that company. Accordingly, the jury were acting reasonably in refusing to find that the defendant was asserting that the Australian Securities Commission suspected that Mr Rivkin had engaged in unlawful conduct. The Court of Appeal's reasons do not mention that the article was capable of an innocent construction besides the construction alleged by Mr Rivkin. Those reasons do not refer to another construction open to the jury – the Australian Securities Commission had summonsed Mr Rivkin to investigate the circumstances of the Swiss companies and his knowledge of their activities. The Court of Appeal's reasons in respect of this imputation pay insufficient attention to – indeed they do not mention – the principle that an appellate court is entitled to set aside the jury's answers or verdict only when the plaintiff's construction is the only one reasonably open. The Court of Appeal erred in holding that the jury's answer to question 1(b) was unreasonable. 35 Lewis v Daily Telegraph [1964] AC 234 at 267. McHugh The Sydney Morning Herald article of 25 February 1998 On the front page of The Sydney Morning Herald article dated 25 February 1998 was a caption stating: "CAROLINE'S WORLD AND THE RIVKIN LINK" It was accompanied by a photograph of Mr Rivkin smoking a cigar. The article itself was on page 11 and took up most of the page. It had a heading "DEATH OF A MODEL". Above this heading in smaller type were the sentences: "When the body of Sydney model Caroline Byrne was found at the bottom of The Gap, many who knew her refused to believe it was suicide. BEN HILLS looks at evidence presented to the Coroner." The article referred to the Coroner being unable to determine how Ms Byrne had died and that he had left open three possibilities: "suicide, murder or an accident." The article declared that there were three theories concerning Ms Byrne's death: "Suicide; Murder 1; and Murder 2." Suicide was the first theory discussed. The article mentioned that Ms Byrne's mother had "killed herself with an overdose of drugs and alcohol, apparently as a result of depression". It said that nine months later: "Caroline herself, mourning her mother, tried to commit suicide by taking sleeping pills and lying in a bath full of water. That attempt failed as (according to Wood) did a later attempt to jump off a building. Caroline had consulted a psychiatrist and been prescribed medication." It went on to say that: "Adding strength to the suicide theory, Caroline went to her GP, Dr Cindy Pan, two days before her death complaining that she had been feeling depressed for a month, and particularly in the previous week. Pan referred her to a psychiatrist (the appointment was for the afternoon she went missing) saying that the cause of the depression was unknown, but insisting that Caroline had 'no thought of self-harm'." The article also referred to a "14-page posthumous case analysis" by a psychiatrist who declared that, on the evidence of Ms Byrne's father and friends, the risk of her committing suicide was low, that it rose to moderate on Dr Pan's evidence and that it rose to high on Gordon Wood's version of events. Discussion of the Murder 1 theory began by stating that the case had been "written off as just another suicide at The Gap". But after pressure from Ms Byrne's father, the Coroner had ordered police to re-open inquiries. The McHugh article said that Wood, who had denied ever being near The Gap on the afternoon of Ms Byrne's death, had been identified by two witnesses as one of two men whom they "had spotted [with] a woman with a 'very striking appearance, like a model' walking and chatting with two men" in that area. The other man was identified as "a Melbourne model-booking agent." The article also said that police and Caroline's relatives were puzzled by Wood's behaviour after he "awoke in front of the TV to find her missing". He had picked up Ms Byrne's father and her brother and had driven to The Gap "where, after searching for some time, he said he spotted her leg and sandshoe by the weak light of a torch he borrowed from two rock fishermen." When questioned by police, "he said he had been led to the body by 'some kind of spiritual communication'." The article said that the Coroner had described Wood's account as a "glaring inconsistency" and had found "'another anomaly' in the way Wood later lied to a number of Caroline's friends, telling them that she had been killed by a car." The article then set out parts of a transcript of an interview between Detective Wyver and Wood that had been tendered as an exhibit at the coronial inquest which "showed one possibility the police were exploring." According to the article, the interview recorded: "Wyver: Now, I have been informed that on the day of Caroline's death she did not in fact attend work, but she made surveillance of you and in the course of this surveillance she caught you and Rene [Rivkin] having homosexual intercourse. What can you tell me about that? Wood: Absolute lies. Wyver: OK, and then I have been informed that as a result of that an argument between her and you ensued. Is there anything ... Wood: Wyver: over The Gap. ... and that you went to The Gap and you threw her Wood: No, that's not correct, not correct." The article then continued: "Wood worked for Rivkin from 1993-96, starting as a 'driver-gofer' and becoming his 'executive assistant'. He travelled extensively in Australia and overseas with Rivkin, regarded him as 'a father as well as a boss', and was learning about 'stock-markets and trading' from him. McHugh Rivkin bought the apartment Wood and Caroline lived in at Potts Point, and paid for a car, clothes and furniture. Wood, who now describes himself as a stockmarket trader, said that he had left Rivkin in 1996 'because I had this dream of getting myself financially set up to take care of Caroline and the family we were planning to have, and when she died that sort of died with her'. He said in the interview that Caroline, with whom he was living in what he described as a 'loving, happy relationship', was 'suspicious' of Rivkin. Asked why, Wood said: '... [Rivkin] used to hang out with a whole stack of people at the cafe which, I am sure, you probably discovered has a reputation for being a hangout for ex-drug dealers ... 'Some of Rene's closest cronies are ... have certain criminal backgrounds or are rumoured to have it. And the fact that Rene is ... has a high degree of interest in good-looking young men ... so she [Byrne] certainly expressed concern about his intentions towards me.' But Wood denied he had ever had a homosexual relationship. He said in his opinion Caroline had committed suicide by jumping off the cliff. Neither Rivkin nor Wood would return telephone calls from the Herald. Wood was not questioned about this allegation during the inquest, nor was Wyver asked the source of his information. Rivkin, who is married with five children, was not called as a witness and did not make a statement to police apart (says Wyver) from a brief 'door-stop' outside one of his haunts, Joe's Cafe in Darlinghurst, several months later when he said he could not recall whether Wood had been driving him the day Caroline died." Finally, the article briefly discussed the Murder 2 theory. It said that it was the most sinister theory about Ms Byrne's death. The theory was based on her father's belief that a contract killer had been hired to do away with her. The article said that her father "makes an extraordinary series of allegations about people he claims were behind the murder. The motive? She had found out about 'a very serious crime' from which they stood to benefit, and they feared she was about to blow the whistle." The last two paragraphs of the article stated: McHugh "The police investigation did not take into account Byrne's theory, no statements were taken or witnesses called, and [the Coroner] does not mention the allegations in his official finding. As far as the police are concerned, Wyver says, the file remains open." Mr Rivkin claimed that the article contained five imputations that were defamatory of him. He also alleged that if one of the imputations was not made out, the article contained an alternative imputation of lesser gravity. The Court of Appeal held that, although it was reasonably open to the jury to find that three of the imputations were not made out, the jury had unreasonably found that the other three imputations had not been made out. Those imputations were: 3(c)(ii) that the Plaintiff was a person criminally liable in respect of the murder of the late Caroline Byrne; that the police had reason to suspect that the Plaintiff had engaged in homosexual intercourse with Gordon Wood; that the Plaintiff is a close associate of criminals." Imputation 3(a) Contrary to the view of the Court of Appeal, it was reasonably open to the jury to find that the article did not contain an imputation that Mr Rivkin "was a person criminally liable in respect of the murder of the late Caroline Byrne." Indeed, it was open to the jury to hold that there was no imputation that Ms Byrne had been murdered. The jury were entitled to hold that ordinary people would read the article as meaning no more than that there was a grave suspicion that she had been murdered. Significantly, the article stated that, after hearing and reading statements from dozens of witnesses including Ms Byrne's father, "examining a cache of forensic evidence and ordering a fresh, more thorough, investigation by the police, the Coroner, John Abernethy, was unable to determine how Caroline Byrne had died." The article went on to say that the Coroner had "left open three possibilities: suicide, murder or an accident." Given this statement, it was open to a jury to conclude that the article contained no imputation that Ms Byrne had been murdered. A reasonable reader reads the article as a whole. It is true that such a reader is entitled to give some parts of the article more weight than other parts. But the jury may have reasoned that, read as a whole, an ordinary reader McHugh would conclude that the article was asserting only that Ms Byrne's death gave rise to competing theories of suicide and murder. It is true that the discussion of the Murder 2 theory stated that the belief of Mr Byrne's father was that a contract killer had been hired to do away with her and that an earlier part of the article indicated that her friends believed she was murdered. But when the article is read as a whole, a jury could reasonably conclude that an ordinary, reasonable reader would not have formed the view that the article as a whole imputed that Ms Byrne had been murdered. There was a grave suspicion that she had been murdered but the evidence did not establish that she had been murdered. I shall assume, however, contrary to my view, that the jury could not reasonably reject the claim that the article contained an imputation that she had been murdered. Nevertheless, I cannot see any basis for holding that the jury acting reasonably must have concluded that Mr Rivkin was "criminally liable in respect of the murder of the late Caroline Byrne". The article stated that Mr Rivkin was not called as a witness at the coronial inquiry and did not make a statement to the police apart from a brief interview when he said "he could not recall whether Wood had been driving him the day Caroline died." The jury were entitled to take the view that ordinary readers would think that it was highly likely that, if Mr Rivkin was even suspected as being implicated in the murder, the Coroner would have called him as a witness. Because that is so the jury may well have reasoned that an ordinary reasonable reader would not think that Mr Rivkin was "criminally liable in respect of the murder of the late Carolyn Byrne." If, as it surely is, "a grave thing to say that someone is fraudulent"36, it is an even graver thing to say that someone is "criminally liable in respect of the murder" of another person. In the absence of an express assertion to that effect, it is an inference or insinuation that a reasonable reader would draw only if no other reasonable inference was open. In Mirror Newspapers Ltd v Harrison37, Mason J pointed out that the "ordinary reasonable reader is mindful of the principle that a person charged with a crime is presumed innocent until it is proved that he is guilty." Because that is so, this Court held in that case that an ordinary reader would not draw an imputation of guilt from a bare report that a person has been arrested and charged with a criminal offence. Similarly, the ordinary reasonable reader does not infer that a person is involved in a crime as serious as murder unless the terms of the article point irresistibly to that conclusion. 36 Lewis v Daily Telegraph [1964] AC 234 at 267. 37 (1982) 149 CLR 293 at 300. McHugh With great respect to the judges of the Court of Appeal, I have considerable doubts whether imputation 3(a) should have been left to the jury at all. To find the imputation pleaded, the ordinary reader would have to infer (1) that Ms Byrne was murdered and (2) that Mr Rivkin had a motive for murdering her – because she knew of his homosexuality or financial misconduct. To find the imputation, the jury would then have to infer from these two inferences that Mr Rivkin either murdered her or was a party to her murder. However, the course of authority in New South Wales holds that a publisher is not liable for an inference that is derived by drawing an inference from another inference38. But assuming that it was open to the jury acting reasonably to find that Mr Rivkin was "criminally liable in respect of the murder" of Caroline Byrne, it seems to me, for the reasons I have given, an impossible proposition to say that the jury were acting unreasonably in refusing to find that the article contained this imputation. "A submission on behalf of [Mr Rivkin] that the article strongly promotes the theory of murder as the cause of death is correct. Added to this is the mention of [Mr Rivkin's] name no less than eleven times in those sections of the article which deal with the theory of murder." Upon this flimsy foundation, the Court of Appeal concluded that "[t]here was no reasonable basis upon which the jury could find that this imputation was not conveyed." At the trial, in the Court of Appeal and in this Court, counsel for Mr Rivkin made much of the fact that his name was mentioned in the article on eleven occasions. He asked rhetorically what was the point of mentioning Mr Rivkin unless it was to implicate him in the death of Ms Byrne? The cynical answer may be that, by linking a well-known stockbroker and investor with Ms Byrne, it made the story more newsworthy. Allegations that Mr Rivkin and Wood had engaged in homosexual intercourse and that Mr Rivkin hung out "with a whole stack of people at the cafe which ... has a reputation for being a hangout for ex-drug dealers" was the sort of irrelevant sensationalism that sells newspaper articles. So was the statement that some of his "closest cronies are ... have certain criminal backgrounds or are rumoured to have it." However, whatever the point of introducing Mr Rivkin's name, the articles did not either expressly or by insinuation impute that he was "criminally liable in respect of the murder" of Ms Byrne. 38 TCN Channel 9 Pty Ltd v Antoniadis (1998) 44 NSWLR 682 at 687-688; Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 at McHugh The Court of Appeal erred in finding that the jury could not reasonably reject imputation 3(a). Imputation 3(c)(ii) Imputation 3(c)(ii) – that the police had reason to suspect that Mr Rivkin had engaged in homosexual intercourse – is obviously built on the statement made by Detective Wyver when interviewing Wood. However, all that the article said was that Wyver had said he had been "informed that on the day of Caroline's death she did not in fact attend work, but she made surveillance of you and in the course of this surveillance she caught you and Rene having homosexual intercourse." The detective is then recorded as asking "What can you tell me about that?" The mere fact that Detective Wyver had been given this information and asked Wood about it does not mean that the jury would be acting unreasonably in holding that it did not mean that "the police had reason to suspect that the Plaintiff had engaged in homosexual intercourse" with Wood. The imputation that the police had reason to suspect that Mr Rivkin had engaged in homosexual intercourse with Wood means that the police had the impression or tentative belief that Rivkin and Wood had engaged in homosexual intercourse. It was open to the jury to conclude that a reasonable reader would not infer or insinuate from the detective asking a question on information given to him that he held the tentative belief or impression that the information was true. Once the information was given to the detective, he was entitled – perhaps bound – to ask the question to see whether it was true and, if so, whether it threw any light on Ms Byrne's death. But asking the question does not necessarily indicate that he had the mental state which the existence of a suspicion requires. The Court of Appeal's discussion of this imputation makes no mention of these matters. It appears to assume – erroneously in my opinion – that, in the absence of a statement that Detective Wyver accepted Wood's denial, the reporting of Detective Wyver's question itself conveyed the imputation. In fairness to the Court of Appeal, its reasoning may reflect the arguments – or lack of them – put forward on behalf of John Fairfax. Grove J said: "The article itself does not disavow the reported hearsay statement beyond reportage of the denial by Wood who is, as previously mentioned, published as a person who had lied (to a number of Ms Byrne's friends in respect of her death) and about whose credibility the matter complained of was generally dismissive. It was submitted on behalf of [John Fairfax] that the publication of the response by Wyver 'OK' to Wood's assertion that these were absolute lies left it open to the jury to conclude that the publication conveyed neither of the imputations. That proposition is logically suspect because following 'OK' is the question concerning the alleged argument which is based upon McHugh the factual supposition that such homosexual intercourse had occurred. Given that circumstance, it was inevitable that at least the alternative pleaded as imputation 3(c)(ii) had been made out in the sense that it must have been conveyed that the police had reason to suspect that the factual supposition had substance." The Court of Appeal erred in holding that the jury could not reasonably reject this imputation. That Court did not mention that the imputation was made out only if the ordinary reader thought that Detective Wyver had the impression or tentative belief that Rivkin and Wood had engaged in homosexual intercourse. The Court's reasons contain no analysis of the type of mental state that "the police" had to hold to make out the imputation asserted. No doubt it was open to the jury to conclude from the asking of the question that an ordinary reader would think Detective Wyver had the relevant impression or belief. But it was far from a necessary inference. Imputation 3(d) Of all the imputations asserted by Mr Rivkin, the imputation that he "is a close associate of criminals" had the strongest basis in what was published. The article reported Wood as saying: "[Rivkin] used to hang out with a whole stack of people at the cafe which, I am sure, you probably discovered has a reputation for being a hangout for ex-drug dealers ... Joe's Cafe ... Some of Rene's closest cronies are ... have certain criminal backgrounds or are rumoured to have it." There is little doubt that, if an imputation had been pleaded that closely followed the text of the above quotation, no jury could reasonably reject either it or its defamatory content. But the imputation pleaded did not follow the text. It alleged that he was a close associate of criminals. That obviously meant that his associates were criminals. But the article did not say that his closest cronies were criminals. It referred to the cafe as being a hangout for ex-drug dealers and some of Mr Rivkin's closest cronies having "certain criminal backgrounds or are rumoured to have it." The jury was not acting unreasonably if it held that the article meant only that Mr Rivkin associated with people who had or were rumoured to have a criminal background. That is a different matter from concluding that his cronies were currently engaged or would, given the opportunity, engage in criminal activity. Wood's statement was also rather tentative, as the words "are rumoured to have" indicate. Indeed, the jury may have thought that reasonable readers would conclude that Wood's lack of credibility and his tentative answer alone made it unsafe to infer that Mr Rivkin associated with criminals. Although it was certainly open to the jury to take the McHugh view that the imputation was made out, it was also open to the jury to hold that a reasonable reader would not draw the imputation, as pleaded. In his reasons, Grove J said: "The imputation does not involve the ordinary reasonable reader drawing a distinction between active and inactive criminals. A miscreant who has undergone whatever was required by the imposition of penalty does not emerge absolved of crime to a point where description as a criminal has become somehow fallacious. [John Fairfax's] argument to the jury was based upon a flawed assumption that the imputation was alleging that [Mr Rivkin] was the associate of 'active criminals' in which terms it was not expressed. Once the assumption is removed it becomes clear beyond argument that the imputation is conveyed." With great respect, this analysis misses the point. It was not the meaning of the imputation that was in issue. It was not a question of whether the imputation alleged that Mr Rivkin was an associate of "active criminals" or whether the imputation drew "a distinction between active and inactive criminals." The issue was whether ordinary readers would think that the article alleged that Mr Rivkin had associates who were now engaged, or given the opportunity would engage, in criminal activity, that is to say, were criminals. The existence of a criminal record does not irresistibly point to the conclusion that the person who has that record is a criminal. There is no rule in the law of defamation or elsewhere that once a criminal, always a criminal. If ordinary readers thought that the article insinuated that Mr Rivkin's cronies were currently engaged or might become engaged in criminal activity, the imputation was made out. If they thought that the article meant only that his cronies had or were rumoured to have criminal records – were, for example, ex-drug dealers – the jury could reasonably find that the imputation was not made out. Accordingly, the Court of Appeal erred in holding that the jury's answer on this imputation was unreasonable. The Sydney Morning Herald article of 5 March 1998 The article of 5 March 1998 was a short report of a television interview with Gordon Wood. The second paragraph of the article stated that Wood had told "the Seven Network's Witness program that suggestions made in a police interview that he had thrown Ms Byrne off The Gap after surveillance she commissioned allegedly caught him having sex with his boss, the flamboyant stockbroker Mr Rene Rivkin, were 'utter lies'. McHugh 'Utter garbage. There's absolutely no evidence to support that Caroline had hired anybody or that Rene Rivkin had homosexual sex with me or anybody,' Mr Wood said." The plaintiff sued on four imputations in respect of this article, the most serious of which was: "7(a) that the Plaintiff had engaged in homosexual intercourse with Gordon Wood". The jury held that none of the imputations were contained in the article of 5 March, and the Court of Appeal upheld the jury's answers in respect of these imputations. An address-in-reply My conclusion that the Court of Appeal erred in finding that the jury had acted unreasonably in respect of certain answers to the questions put to them makes it unnecessary to determine whether, in any event, the Court was correct in ordering a new trial of all questions put to the jury. As I have indicated, one reason for the Court's order was its conclusion that counsel for the plaintiff should have been given an address-in-reply, a proposition that does not fit well with the common law tradition and practice in civil jury trials. The rationale for this proposed change in traditional practice is that it is unfair to the plaintiff not to have the opportunity of answering the defendant's arguments concerning the meaning of the article and whether it is defamatory. But this rationale overlooks the fact that, even in conventional defamation trials, counsel for the plaintiff often does not know what the defendant's counsel will say on the issues of meaning and defamation. It is a fundamental rule of the common law jury trial of a civil cause that, if counsel for the defendant does not call evidence, he or she has the last address. Statutes or Rules of Court may, of course, alter that fundamental rule of the common law. In New South Wales, Pt 34 r 6 of the Supreme Court Rules (1970) gives effect to the common law rule but gives the judge a discretion to alter the order of addresses. It is a discretion, however, that must not be used to negate the general rule. It should be exercised only when the justice of the case requires Although a s 7A trial is unique, in principle it does not differ from other civil jury trials in general and more conventional defamation trials in particular. In conventional defamation trials, the defendant often does not call evidence. It is not uncommon for the only evidence in such trials to consist of the plaintiff's evidence, the publication and the circulation figures. Even when the defendant has pleaded fair comment or qualified privilege, its counsel may not call evidence but rely on cross-examination of the plaintiff or his or her witnesses to McHugh establish the facts necessary to prove the defence upon which the defendant relies. In all these cases, counsel for the plaintiff must address first and has to rely on his or her wit and intelligence to deal in advance with the arguments that the defendant's counsel may later use. These cases are no different in substance or fairness from the trial under the s 7A procedure. Claims that it is unfair to refuse counsel for the plaintiff an address-in- reply overlook the extraordinary advantage that a skilful counsel, appearing for the plaintiff, gets in the opening address in a defamation trial. Psychologists take it as a given that selective perception influences our interpretation and understanding of data. As Scott Plous has pointed out39: "[I]t is nearly impossible for people to avoid biases in perception. Instead, people selectively perceive what they expect and hope to see." Skilled counsel, appearing for the plaintiffs in defamation trials, exploit this and other biases by delaying bringing the contents of the publication to the jury's attention until they have injected the plaintiff's preconceptions and assumptions into the collective mind of the jury. They begin by discussing the publication in general terms without going to the details. They plant in the collective mind of the jury an expectation that what they will read will be the imputations for which the plaintiff contends. Jurors then tend to see in the publication what they expect to see. Most judges allow counsel to discuss the contents of the publication in the opening address on an undertaking to tender the publication when the evidence commences. Often enough, the publication is tendered and marked as an exhibit during the opening address. But it is a matter for counsel as to when he or she discusses the contents of the publication with the jury. If counsel for the plaintiff has exploited the advantage of the opening address, by the time that he or she deigns to discuss the words of the article with the jury, the jury will be ready to read the article with all the preconceptions and assumptions that favour the plaintiff's reading of the publication. Eradicating the biases, skilfully planted in the collective mind of the jury by counsel for the plaintiff, is no easy task for counsel for the defendant. The real but unstated premise of the complaint of unfairness in counsel for the plaintiff not having an address-in-reply is that in a s 7A trial the jury does not have evidence from the plaintiff as to the falsity of the imputations and the hurt and distress that the publication caused. Because that is so, the jury may assume, unfairly to the plaintiff, that the imputations are true. Falsity and hurt to feelings are, of course, irrelevant to the issues of meaning and defamation in the trial – 39 Plous, The Psychology of Judgment and Decision Making, (1993) at 15. McHugh whether it be a s 7A trial or the conventional defamation trial. But the plaintiff's evidence on those matters usually tends to create sympathy for the plaintiff and sometimes prejudice against the defendant. The s 7A procedure eliminates these advantages for the plaintiff who must conduct the case in the detached – and some would say unreal – atmosphere of a jury trial on documentary evidence. It is unnecessary for me to decide in this case whether this Court should reject so gross a departure from the common law practice and tradition of addresses in civil jury trials as envisaged by the Court of Appeal. I can only hope that in the meantime that Court will reconsider this departure from a practice and tradition that is now more than 200 years old. Conclusions The jury were acting reasonably when they refused to find that the articles conveyed the imputations pleaded. The Court of Appeal erred in concluding that no reasonable jury could have given the answers that they did. It follows that the appeal must be allowed and the verdict for the defendant entered by the learned trial judge must be restored. Order The appeal should be allowed. The orders of the Court of Appeal should be set aside. In their place, this Court should order that the appeal to the Court of Appeal be dismissed with costs. Kirby KIRBY J. This appeal from a judgment of the New South Wales Court of Appeal40 concerns the law and practice of defamation trials in New South Wales. By reason of the Defamation Act 1974 (NSW) ("the Act") s 7A, there are special features of such trials, unique to that State41. The facts and relevant legislation Three impugned publications: The background facts are set out in other reasons42. The respondent, Mr Rene Rivkin, sued the appellant, John Fairfax Publications Pty Ltd, in respect of imputations said to have been conveyed to the ordinary reasonable reader concerning Mr Rivkin, and defamatory of him, in three publications of the appellant. Those publications were The Australian Financial Review of 21-22 February 1998 ("AFR"); The Sydney Morning Herald of 25 February 1998 ("SMH1") and The Sydney Morning Herald of 5 March 1998 ("SMH2"). Because the matters complained of are quoted extensively in other reasons43, I will not repeat them. The appellant did not contest publication. Nor did it dispute that at least one person who had read SMH1 had also read the article in AFR. That concession was relevant to the reliance by Mr Rivkin upon a true innuendo pleaded by him to the effect that those who read SMH1, having read AFR, would have done so with a heightened awareness of the matters previously published, such that the content of SMH1 would thereby have given rise to imputations inculpating Mr Rivkin in the murder of Ms Caroline Byrne ("the deceased")44. A peculiar legal procedure: In accordance with the Act45, a plaintiff in New South Wales does not sue upon the matter complained of as such. He or she sues in respect of particular imputations alleged to arise from a close analysis of the publication. Each established imputation has been held to constitute a separate cause of action46. This approach has led to artificiality. Those 40 Rivkin v John Fairfax Publications Pty Ltd [2002] NSWCA 87. 41 Noted in Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 578- 42 Reasons of McHugh J at [12]-[16]; reasons of Callinan J at [173]. 43 Reasons of Callinan J at [174]. 44 Reasons of Callinan J at [209]. 46 See Petritsis v Hellenic Herald Pty Ltd [1978] 2 NSWLR 174 at 190. Kirby complaining about defamatory matter in a publication seek to eke out (often in language different from the publication itself) a multitude of imputations for which the complaining party sues. The present appeal is far from the worst case No one submitted before this Court that the foregoing approach was wrong. No one suggested that the Constitution implied any limitation or restriction on this procedure or on the respondent's cause of action. Despite the artificiality that it tends to cause – diverting attention from the publication to the lawyer's pleading of the alleged imputations – I shall assume that this is what the New South Wales legislation requires. The problems that have arisen in the present case (as in others) are substantially the outcome of the replacement of what was formerly a comprehensive and intuitive process of jury assessment, taken to reflect community perception of a publication viewed as a whole, by a procedure whereby perception is substantially directed by lawyers towards formulae re-expressed by lawyers and ultimately, for the most part, evaluated and judged by lawyers. In compliance with the foregoing practice, the representatives of Mr Rivkin applied themselves with gusto to the identification of numerous imputations claimed to arise from the three publications in question. There followed the inevitable pre-trial challenges by the appellant concerning the capability of the publications to give rise to the imputations as pleaded. There were two interlocutory hearings in the Supreme Court of New South Wales before Levine J. In a decision in July 1998, his Honour rejected six pleaded imputations alleged to have arisen respectively from AFR and SMH1. In a further interlocutory decision of September 1998, his Honour struck out four additional pleaded imputations. By s 7A(1) of the Act it falls to the judge, where proceedings for defamation are to be tried in part before a jury, to determine whether the matter complained of is "reasonably capable of carrying the imputation pleaded by the plaintiff" and "reasonably capable of bearing a defamatory meaning". The section thus recognises a judicial filter. That filter prevents the more imaginative and remote imputations of the pleader from coming before the jury at all. It is important in the present appeal to appreciate (as the judges below would all have done) that Mr Rivkin's imputations had already been subjected to this filter. A number of his imputations had fallen by the wayside. In respect of all of those that remained, Levine J had determined that the matters complained of were reasonably capable of carrying the pleaded imputations and of bearing the 47 eg Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 148-151. Kirby defamatory meanings asserted by Mr Rivkin. However, it then remained, in accordance with s 7A(3), for the jury: "to determine whether the matter complained of carries the imputation and, if it does, whether the imputation is defamatory". In the Court of Appeal, Mr Rivkin pressed a ground of appeal (or application for leave to appeal) against the pre-trial interlocutory rulings of Levine J, claiming that they were too narrow48. That ground of appeal was rejected by the Court of Appeal49. This Court has not been troubled by such matters. Their only significance is that they illustrate the hurdles that a person in the position of Mr Rivkin must overcome before having his pleaded imputations considered by the jury. The contested imputations that the jury considers are not raw and unconsidered. The attenuated jury trial: Following the resolution of the interlocutory proceedings (which was no small thing) the limited trial of the matters to be determined by the jury took place between 17 and 23 April 2001 before the primary judge (Simpson J) and a jury of four persons. There was no oral evidence. For Mr Rivkin, the three publications were tendered. The appellant called no evidence. Remarkably enough, the entire time of the trial was then taken up by the addresses of counsel representing the respective parties. There followed the charge to the jury by the primary judge. No complaint is made concerning the accuracy of her Honour's instruction to the jury on the law that they were to apply. At the conclusion of Simpson J's charge, on 23 April 2001, at 11.50 am the jury retired. At 2.25 pm they returned at the conclusion of their deliberations to announce their answers to the questions left to them concerning the imputations relied on by Mr Rivkin. As appears in other reasons, the jury found that none of the pleaded imputations was conveyed by any of the matters complained of. It was therefore unnecessary for the jury to determine whether any of them was defamatory of Mr Rivkin. Judgment was directed in favour of the appellant. The decision of the Court of Appeal Issues in the appeal: In the Court of Appeal, Mr Rivkin argued, relevantly, two points50. The first, variously put, was that the answers given by 48 [2002] NSWCA 87 at [12]. 49 [2002] NSWCA 87 at [151] per Grove J. 50 [2002] NSWCA 87 at [36]. Kirby the jury were appealably erroneous, in the sense that they demonstrated that the jury had acted "perversely" or unreasonably in reaching answers that no reasonable jury could properly have given in the circumstances. Secondly, Mr Rivkin complained that the primary judge had erred in a procedural ruling at the outset of the trial in refusing his counsel's application for a direction altering the order of addresses so as to permit Mr Rivkin's counsel to address the jury after the address of counsel for the appellant. That request had been made notwithstanding the fact that the appellant, having called no evidence, would ordinarily enjoy the right of last address to the jury. The Court of Appeal unanimously allowed Mr Rivkin's appeal. It set aside the judgment entered for the appellant. It ordered that the matter be remitted to the Common Law Division of the Supreme Court for a new trial generally in relation to all of the pleaded imputations upheld by Levine J51. The manner in which the Court of Appeal reached these conclusions is described in Approach to jury verdicts: The principal reasons in the Court of Appeal were written by Grove J. On the substantive challenge to the appealable unreasonableness (or "perversity" as it was put) of the jury's answers, Grove J acknowledged the particular deference owed to the conclusions of a jury as the "constitutional tribunal" for deciding contested issues of fact53; the special respect owed to the jury's answers in defamation actions given the unique legislative preservation of attenuated jury trials in New South Wales in that context54; the heavy burden imposed on Mr Rivkin to justify appellate intervention in such a matter55; and the various formulae propounded by appellate courts to give effect to the approach of severe restraint ("incontrovertibly wrong"56, a "decision … such as no jury could give as reasonable men"57, that the verdict was not 51 [2002] NSWCA 87 at [155] per Grove J; at [1] per Meagher JA; at [3] per Foster AJA. 52 Reasons of McHugh J at [15]; reasons of Callinan J at [178]-[182]. 53 [2002] NSWCA 87 at [55] per Grove J citing Gatley on Libel and Slander, 9th ed (1998) at 889-890; cf Grobbelaar v News Group Newspapers Ltd [2001] 2 All ER 54 [2002] NSWCA 87 at [59] citing Hanrahan v Ainsworth (1990) 22 NSWLR 73 at 55 [2002] NSWCA 87 at [61]. 56 [2002] NSWCA 87 at [55] citing Evans v Davies [1991] 2 Qd R 498 at 511. Kirby "reasonably open" is "clear and beyond argument"58 and that the verdict is "perverse"59). Although these formulae were criticised by both parties in this Court – the appellant suggesting that they were insufficiently stringent and Mr Rivkin arguing that the reference to "perversity", in particular, went further than the law required – it is clear beyond argument that the Court of Appeal reminded itself that great caution was to be exercised before setting aside the jury's answers after a trial that was otherwise conducted according to law. Grove J then proceeded to address the way in which an "ordinary reasonable reader" would understand the three publications as relating to Mr Rivkin. With respect to a number of the pleaded imputations relied on by Mr Rivkin, Grove J (with whom on these issues the other judges of the Court of Appeal agreed) concluded that the jury's answers were not unreasonable in the relevant sense. They could not therefore be disturbed by an appellate court60. As an analysis of those imputations, and the conclusions of the Court of Appeal upon them, appears elsewhere, I will not repeat what his Honour said61. The appellant naturally laid emphasis upon the large number of instances in which the Court of Appeal had concluded that it could not properly disturb the answers of the jury and the fact that all of the answers given in respect of the imputations said to arise from the publication of SMH2 had been upheld by that Court. Effectively it asked: if so many of the jury's answers were immune from disturbance, how could others be so wrong? Four unreasonable answers: The Court of Appeal concluded that some of the answers given by the jury were unreasonable (or "perverse") in the relevant sense. For convenience those answers may be catalogued as falling into four classes: The Offset Alpine imputations (AFR) (Jury answers 1(a) and 1(b)); 57 [2002] NSWCA 87 at [55] citing Australian Newspaper Co Ltd v Bennett [1894] AC 284 at 287 and at [56] citing Ryan v Ross (1916) 22 CLR 1 at 22. 58 [2002] NSWCA 87 at [58], [60] citing Cairns v John Fairfax and Sons Ltd [1983] 2 NSWLR 708 at 716; Broome v Agar (1928) 138 LT 698. 59 [2002] NSWCA 87 at [54]. 60 Jury answers pars 1(c)(i), 1(c)(ii), 3(b)(i), 3(b)(ii), 3(c)(i), 5(b)(i), 5(b)(ii), 7(a), 7(b), 7(c)(i), and 7(c)(ii). 61 See esp reasons of Callinan J and the Table set out at [179]-[182]. Kirby The imputation that Mr Rivkin was a person criminally liable in respect of the murder of the deceased. (SMH1) (Jury answer 3(a)); true innuendo case (AFR and SMH1) (Jury answer 5(a)); The imputation relating to the suggestion that Mr Rivkin had engaged in homosexual intercourse with Mr Gordon Wood (SMH1) (Jury answer 3(c)(ii)); and The imputation that the appellant was a "close associate of criminals" (SMH1) (Jury answer 3(d)). Having concluded that, in these four respects, the jury's answers had miscarried, it became necessary for the Court of Appeal to decide whether to provide relief to Mr Rivkin, specifically whether to order a new trial and, if so, to what extent. It was in that connection that the Court of Appeal considered two subordinate arguments advanced for Mr Rivkin. One of these was derived from the "persistently"62 negative answers to all of the questions asked of the jury on the first issue as well as the relatively short time (less than two and a half hours) of the jury's retirement. Mr Rivkin submitted that, from these considerations, an inference arose that the jury had "misapplied itself to its task". Grove J was not inclined to attach much significance to the comparatively short retirement of the jury. He concluded that it was "not open to speculate" about why the jury had returned the uniformly negative answers63. However, Foster AJA was more affected by this consideration. He could not accept that, in such a "significantly short period of time, the jury could have properly focused upon the complex issues of this case, even if one allows, in their favour, that they attended carefully to the addresses of counsel and the judge's summing-up"64. He therefore expressed "concern that the verdict was influenced by extraneous considerations"65. He cited this concern to reinforce his conclusion in concurring with Grove J's "comprehensive analyses of the evidence and submissions relating to each imputation" and the result that "certain of [the imputations] should be regarded as inevitably established"66. The third member of the Court of Appeal 62 [2002] NSWCA 87 at [112] per Grove J. 63 [2002] NSWCA 87 at [112]. 64 [2002] NSWCA 87 at [7]. 65 [2002] NSWCA 87 at [8]. 66 [2002] NSWCA 87 at [8]. Kirby (Meagher JA) did not specifically refer to the "short retirement" submission. However, he expressed agreement with the reasons of both Foster AJA and Order for a general retrial: Normally, where, as here, an appellate court upholds an appeal in part, but rejects it in other respects, the relief granted to the partly successful party is confined to those aspects of the appeal upon which that party has succeeded. It was in this respect that Mr Rivkin's second related submission, concerned with the procedures of the trial, became relevant. This was supported by a specific ground of appeal argued before the Court of Appeal. It challenged the interlocutory decision of the primary judge refusing the request for a direction that Mr Rivkin's counsel be allowed to make an opening address and an address in reply at the conclusion of the closing address for the appellant67. Before the trial, a letter to the appellant's solicitors had indicated that Mr Rivkin would be seeking such a direction68. The proposal was duly advanced and opposed. The primary judge refused it. It was not renewed. On the appeal, however, it was suggested that the course that the trial had then taken (and the inability, in the telescoped s 7A procedures, of Mr Rivkin's counsel to answer arguments of the appellant before the jury) explained the erroneous and uniformly negative answers given by the jury to the questions relating to whether the matters complained of carried the imputations alleged. This second factor appears to have influenced the decision of the Court of Appeal to grant a general retrial of all of the imputations upon which Mr Rivkin had sued in the first trial, including those in respect of which Grove J, for that Court, had concluded that (taken alone) the answers were not appealably unreasonable. Taken together, and considered with the suggested error of the interlocutory ruling on the order of addresses, they were sufficient to persuade the Court of Appeal that the jury had "misapplied itself to its task"69. For such a conclusion, the solution in which all three judges of the Court of Appeal ultimately joined was a general order for a retrial. Sequence of counsel's addresses: In coming to that conclusion, there were important differences between the reasons of the judges constituting the Court of Appeal about the challenge to the primary judge's refusal to permit Mr Rivkin's counsel a right of reply. Thus, Meagher JA was of the opinion that the issue was 67 [2002] NSWCA 87 at [36] per Grove J. 68 [2002] NSWCA 87 at [42] per Grove J. 69 [2002] NSWCA 87 at [112]. Kirby governed not by the Supreme Court Rules 1970 (NSW) ("SCR") but by the inherent jurisdiction of the Supreme Court to order its proceedings. He favoured the adoption of a general principle that a plaintiff should have a right of first address and a right of reply. He expressed the opinion that "[t]he present case illustrates the confusion which results from the failure to accord the plaintiff such a right"70. On the other hand, Foster AJA considered that the matter was governed by the Rules of Court71. In his view, "rules of universal application" were not the solution. Least of all, could a rule be propounded permitting a plaintiff both an opening address and a right of reply72. The third judge, Grove J, noted earlier interlocutory decisions of trial judges consistent with the approach that had been adopted by the primary judge in the present case73. However, he suggested that the inability of a plaintiff's counsel to respond to an argument before the jury, including one that was "tenuous or even silly", was untenable. He therefore decided that the order of addresses in such trials should be the subject of judicial "regulation", apparently by a universal judicial rule74. Primarily, Grove J favoured a principle that a defendant should address the jury first so that, in that way, the plaintiff was effectively given a right of reply in every case. But because the other judges in the appeal considered that the plaintiff should normally have the opportunity of first address, Grove J concurred with Meagher JA's opinion on this issue. He therefore favoured, as a matter of general principle, a procedure whereby "the plaintiff should … subject to discretion, have a right of reply"75. As this facility had been denied to Mr Rivkin, and might possibly explain the negative answers to all the questions concerning the capability of the matters complained of to carry the imputations pleaded by the plaintiff, the only orders that would achieve justice in the case were orders for a complete retrial. 70 [2002] NSWCA 87 at [2]. 71 Pt 34 r 6 SCR. 72 [2002] NSWCA 87 at [24], [25]. 73 [2002] NSWCA 87 at [46]. The cases include: Marsden v Amalgamated Television Services Pty Ltd [1999] NSWSC 121 and Rakhimov v Australian Broadcasting Corporation [2001] NSWSC 693. 74 [2002] NSWCA 87 at [51]. 75 [2002] NSWCA 87 at [53]. Kirby It was in that way that the Court of Appeal reached its conclusion on what should happen in the second trial of Mr Rivkin's claims against the appellant. This appeal, by special leave, challenges that outcome. The issues The primary issue is whether the Court of Appeal erred in concluding that the trial before the primary judge and the jury had miscarried in a way authorising its intervention to set aside the answers given by the jury in the case of the four categories of imputation mentioned76. If, as McHugh J has concluded77, the Court of Appeal erred in its approach in this respect, and in its conclusion in relation to that primary question, the ancillary issues, concerned with the procedures of the trial and scope of any retrial, do not arise. The judgment in favour of the appellant and against Mr Rivkin would be restored. The appeal therefore presents four issues: (1) Did the Court of Appeal err in the approach that it took to its authority to disturb the jury's answers to the questions relating to the reasonable capability of the matters complained of to carry the imputations pleaded by Mr Rivkin?; (2) Did the Court of Appeal err in the conclusion that it reached that, in respect of the four categories of imputations upon which Mr Rivkin sued, the jury's answers were erroneous and authorised appellate intervention?; (3) Having regard to the resolution of the foregoing issues, did the Court of Appeal err in concluding that the primary judge had erred in exercising her discretion by refusing to permit counsel for Mr Rivkin to address the jury in reply to the address given by counsel for the appellant?; and (4) Having regard to the resolution of issue (3), to the length of the jury's retirement and any other relevant considerations, did the Court of Appeal err in ordering a general retrial rather than a retrial only of the residual defamatory imputations which were inevitably established by the appellant's publication of the matters complained of? 76 The four categories of imputations are described at [96] above. 77 Reasons of McHugh J at [78]. Kirby The Court of Appeal did not err in its approach Old authorities – extreme restraint: Upon the first question, there is a division of opinion in this Court. McHugh J is of the view that the Court of Appeal erred in the approach that it took to its appellate function when invited to set aside the jury's "verdict", being, relevantly, the answers given by the jury in this trial as to the capability of the matters complained of to carry the imputations pleaded by Mr Rivkin in the four categories identified78. The other members of this Court have concluded that there was no such error of approach79. On this issue, I agree with the majority. In his reasons, McHugh J has collected extracts from a large number of the formulations used by appellate judges in Australia and England, designed to remind appellate courts of the severe restraint to be exercised in the disturbance of a jury's conclusions upon the matters submitted to them. However, there is no evidence that the Court of Appeal overlooked, or ignored, these injunctions. Quite the contrary. Some of them were expressly cited by Grove J in an extended passage in his Honour's reasons in which he identified the heavy burden undertaken by an appellant in a challenge of the kind mounted by Mr Rivkin80. Foster AJA added his explicit recognition of the "extreme caution" to be followed by an appellate court in such a case81. He referred to additional authority in this Court82. Meagher JA agreed with both of the foregoing reasons83. Accordingly, it should not be accepted that the Court of Appeal approached its function in an incorrect way or, by its reasons, disclosed an error in its understanding of the law governing the approach that it should take. Perversity is not the test: If anything, by adopting the verbal criterion of "perversity" (as Grove J84 and Foster AJA85 and, by concurrence, Meagher JA86 78 Reasons of McHugh J at [17]-[22]. 79 Reasons of Gleeson CJ at [1]; reasons of Callinan J at [183]-[185]; reasons of 80 [2002] NSWCA 87 at [54]-[62]. 81 [2002] NSWCA 87 at [4]. 82 Brooker v Roszykiewcz (1963) 37 ALJR 246 at 250. See also at 251, 253. 83 [2002] NSWCA 87 at [1]. 84 [2002] NSWCA 87 at [54]. 85 [2002] NSWCA 87 at [10]. Kirby did), the Court of Appeal applied a test that was "probably higher than required" by law87. In its ordinary connotation, "perversity" connotes deliberate or blind contrariness, obduracy and idiosyncrasy. The word is a left-over from an earlier time in the law. In my view, at least in this and like contexts, it should be given a decent burial. A number of considerations reinforce my view that the proper approach to an appeal to the Court of Appeal against jury decisions is one that permits disturbance of such decisions "in an extreme case … [where they are] unreasonable"88. Some of the considerations are relevant to appeals more generally. Others are of special relevance to an appeal from answers given in an attenuated jury trial of the kind provided for in s 7A of the Act. The language of the decisions using "perversity" and similar epithets is redolent with an attitude to the absolute finality of jury verdicts that preceded the introduction, by statute, of general facilities for appeal, including against decisions on facts claimed to have been wrongly found89. The introduction of that facility has demonstrated repeatedly that serious mistakes, and grave injustices, can occur as a result of erroneous factual decisions – probably more than in mistaken decisions of law. Whilst error in fact-finding can more readily be demonstrated in the decisions of judges, who must normally give reasons, the procedure of appeal has made contemporary judges more willing to scrutinise jury verdicts for the demonstration of serious error than would have been the case in the times before the facility of appeal became so common and so manifestly beneficial. Statutory appeal and jury "immunity": Some of the language of the older authorities, that might be thought to cloak civil jury verdicts (including in defamation trials) with a mystical immunity from appellate review needs to be reconsidered in the light of the basic statutory legal principle that imposes upon appellate courts in Australia a function to perform their review when an appeal is lawfully brought to them. In such a case, the duty imposed by the statute must be obeyed. It cannot be rejected because of pre-existing or overblown judicial dicta. 86 [2002] NSWCA 87 at [1]. 87 cf reasons of Callinan J at [179]. 88 Gatley on Libel and Slander, 9th ed (1998) at 889 [36.19]. 89 State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In Liq) (1999) 73 ALJR 306 at 331-332 [93]; 160 ALR 588 at 620-622; see also Warren v Coombes (1979) 142 CLR 531 at 545 quoting from Edwards v Noble (1971) 125 CLR 296; Fox v Percy (2003) 77 ALJR 989 at 994-995 [24]-[28]; 197 ALR 201 at 207-209; Whisprun Pty Ltd v Dixon [2003] HCA 48 at [123]. Kirby This is yet another instance in which lawyers, raised in the language of common law judges, must shake off their inclination to adhere to over-broad judicial remarks that, given full rein, would undermine a duty imposed on them by statutory requirements90. It is true that jury decisions are still accorded a special status in our law because juries are taken to represent a microcosm of the entire community. That is what is meant by calling the jury the "constitutional" tribunal of fact. This feature of the jury was properly acknowledged by the Court of Appeal in the present case91. However, this consideration can only be a factor in appellate analysis. It does not relieve the appellate court of the duty imposed by statute to determine an appeal, including in a case following a jury trial, where an application is made for a new trial on the basis that the jury verdict is unreasonable in the appellate sense92. Rationality in civil process: An appeal, including against jury verdicts and answers, must be proper and effective, not a procedure that is perfunctory and merely symbolic93. It is erroneous to elevate a jury verdict in favour of a defendant in a defamation case to a status comparable to that of a verdict of acquittal of a defendant in a criminal case94. As Lord Scott of Foscote observed in Grobbelaar v News Group Newspapers Ltd95: "In a civil case, the parties litigate on an even playing field. It is as much an affront to justice if a 'guilty' claimant succeeds in obtaining damages as it is if an 'innocent' claimant fails in his claim for damages. A verdict in favour of the defendant … cannot be set aside simply because the court thinks that the verdict was not 'safe'. Something more would be required. 90 eg Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 88 [43]; The Commonwealth v Yarmirr (2001) 208 CLR 1 at 111-112 [249]; Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 184-185 [54]; Conway v The Queen (2002) 209 CLR 203 at 227 [65]. 91 [2002] NSWCA 87 at [59]. 92 Supreme Court Act 1970 (NSW), s 102. See reasons of McHugh J at [21]. 93 cf Young v Registrar, Court of Appeal [No 3] (1993) 32 NSWLR 262 at 274-279, 289-290 referring to Art 14.5 of the International Covenant on Civil and Political Rights. 94 Grobbelaar v News Group Newspapers Ltd [2002] 1 WLR 3024 at 3052 [73]; [2002] 4 All ER 732 at 758. 95 [2002] 1 WLR 3024 at 3052 [73], 3053 [75]; [2002] 4 All ER 732 at 758, 759. Kirby The appellate court would need to be satisfied that, in the light of the evidence, a jury could not reasonably have concluded that the claimant had committed the crime. Each side is equally entitled to justice. The appellate court must, of course, pay proper respect to the jury verdict. The jury are the fact finders. In a civil case, the jury, as fact finders, are entitled to the same respect, no more and no less, than that which is due to a trial judge sitting without a jury. The difference is that the trial judge's reasoning will be, or should be, on the face of the judgment whereas the jury's reasons, being undisclosed, will need to be re-constructed by the appellate court. Subject to that important difference, however, the factual conclusions of juries in civil cases should, in my opinion, be treated by an appellate court no differently, with no greater and no less respect, than the factual conclusions of judges." This reasoning is consistent with the contemporary view that jury verdicts in civil cases must be viewed in the context of a process of decision-making for a society of a particular kind that upholds, so far as it can, fair, reasonable and rational decision-making in its courts96. Lord Bingham of Cornhill in Grobbelaar said97: "The oracular utterance of the jury contains no reasoning, no elaboration. But it is not immune from review. The jury is a judicial decision-maker of a very special kind, but it is a judicial decision-maker none the less. While speculation about the jury's reasoning and train of thought is impermissible, the drawing of inevitable or proper inferences from the jury's decision is not, and is indeed inherent in the process of review." These remarks reflect the proper approach to contemporary appellate review of jury verdicts, including in the answers that they give in performance of their functions of deciding the limited issues reserved to them under s 7A of the Act98. Rationality is, and should be, a hallmark of contemporary civil 96 cf Steyn, "The Intractable Problem of The Interpretation of Legal Texts", (2003) 25 Sydney Law Review 5 at 18. 97 [2002] 1 WLR 3024 at 3029-3030 [7]; [2002] 4 All ER 732 at 737. 98 In Grobbelaar reference was made to the Human Rights Act 1998 (UK), s 12(1) and (4). See Grobbelaar [2002] 1 WLR 3024 at 3041 [40] and at 3049-3050 [63]; [2002] 4 All ER 732 at 748, 756. However, the reasoning of their Lordships appears to have proceeded independently of the operation of that Act. Kirby proceedings99. Where it has been found wanting at trial, it may be provided on appeal. The contrary view is a left over of medieval tournaments and trial attitudes. Relevance of jury's function: Each decision-maker in the process established by Parliament, whether judge or jury, is performing a statutory function. Each is therefore a receptacle of statutory power. None may act irrationally or in a way alien to the purposes of the power. Each must fulfil those purposes. If either does not, it is the duty of an appellate court to intervene. The difficulty of establishing the requisite error in the case of a jury, which gives no reasons, is a practical consideration that limits intervention to an "extreme" or "manifest" or "inevitable" case that is "clear and beyond argument". But the criterion for intervention is the failure of the jury to perform their function as the statute contemplated. Such default may be shown by a manifestly unreasonable verdict or decision. Demonstration that one of several verdicts is manifestly unreasonable may sometimes cast doubt on others100. Although it is possible for oral evidence to be given before the jury in proceedings conducted in accordance with s 7A of the Act, normally this is not done. Typically, the proceedings follow the course adopted in the trial of Mr Rivkin's case. In such a hearing, there is nothing before the jury that is not equally before the appellate court. What jury members make of this procedure is impossible to say. Perhaps they expect plaintiffs to give evidence, at least of the hurt they have suffered and even to deny the truth of the defamatory imputations pleaded. Perhaps they expect the publisher to call evidence justifying the matter complained of. How they react to the artificial and telescoped task assigned to them is a matter for speculation. The fact that most trials, like Mr Rivkin's, involve little more than the tender of the matter complained of means that one of the normal reasons for particular restraint against appellate disturbance of jury verdicts is absent in such cases. There is no reason for the appellate court to make allowance for the advantages that the jury had in having seen or heard witnesses over the course of a lengthy trial101. Whilst the jury continues to enjoy a symbolic function, because its members come from the general community, there remains a real risk, heightened in the s 7A procedure, that they may misunderstand their task. Further, the extent to which a civil jury of four persons represents the entire community should not be overstated, lest fiction and historical symbols overwhelm reality and commonsense. 99 Whisprun Pty Ltd v Dixon [2003] HCA 48 at [123]. 100 Reasons of Gleeson CJ at [5]. 101 cf Dearman v Dearman (1908) 7 CLR 549 at 564. Kirby For an imputation even to be considered by the jury, it must have passed the first hurdle provided by s 7A. A judge must already have determined, also on the papers, both that "the matter is reasonably capable of carrying the imputation pleaded by the plaintiff" and that "the imputation is reasonably capable of bearing a defamatory meaning"102. In Mr Rivkin's case, in respect of those questions, Levine J so determined with regard to all of the imputations left to the jury. Whilst it is true that judges are enjoined, properly in my view, that they should not deprive the jury of their function by approaching too narrowly the preliminary determinations in that regard103, the fact that a judge has decided such preliminary questions by the standard of the reasonable capability of the matter complained of to fulfil the essential preconditions, means that an appellate court can approach its function in the knowledge that this step has been taken. It is not the same determination as that reserved by s 7A(3) of the Act to a jury where one is summoned to play its part under s 7A(3). It remains important for the Court, at first instance and on appeal, to respect the role reserved to the jury, limited although it is. Nevertheless, the circumstance that the imputations surviving into the trial have already passed the test of reasonable capability required by s 7A(3) is a reason why it is misleading to talk of the appellate function in terms limited to the correction of "perverse" verdicts or verdicts described with similar pejorative epithets. Special risks in particular proceedings: There is a special risk that arises from the procedures established by s 7A of the Act against which appellate review may prove an important safeguard. Because the section concentrates attention upon the "imputation pleaded", there is a danger that a jury may address themselves to the imputations pleaded by the lawyers to the exclusion of the full context of those imputations in the matter complained of104. The need to view the imputations in the entire context is made clear by the language of s 7A(3) of the Act. The imputations, as pleaded by the plaintiff, constitute the causes of action for which the plaintiff sues. But they can only be understood when read together with the matter actually published, considered as a whole105. It would be contrary to the statute and out of step with all modern 102 The Act, s 7A(3)(a) and (b). 103 cf Naxakis v Western General Hospital (1999) 197 CLR 269 at 298 [83]. 104 cf Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 578-581 105 cf S & K Holdings Ltd v Throgmorton Publications Ltd [1972] 1 WLR 1036 at 1039; [1972] 3 All ER 497 at 500; National Mutual Life Association of Australasia Ltd v GTV Corporation Pty Ltd [1989] VR 747 at 768. Kirby approaches to the ascertainment of the meaning of words and other conduct to ignore the context when considering what was meant. Context may be helpful to a plaintiff in understanding the sting of the defamation complained of. Or it may be helpful to a publisher in putting the pleaded imputations into the entire setting that has the effect of removing that sting. Appeal permits a second look at the outcome of a statutory procedure that carries distinct risks of over-concentration upon the pleaded imputation, isolated from the entirety of the matters complained Conclusion: no error of approach: Because the Court of Appeal evidenced no error in the approach that it took to the standard of review applicable to the jury's answers (and indeed expressed an approach that, if anything, was more stringent than the law requires) the first complaint of the appellant should be rejected. The fact that the Court of Appeal adopted a correct approach in considering Mr Rivkin's appeal does not mean that it reached the correct conclusion that the imputations that it found in the four categories that it decided in Mr Rivkin's favour were "inevitably established", such that the conclusion of the jury to the contrary was appealably unreasonable. I therefore turn to the second issue. The four categories of imputation The Offset Alpine imputations: Before this Court, the question is not whether the jury erred in a way permitting appellate intervention but whether the Court of Appeal erred in such a way, authorising this Court's intervention. Given the room for differences of view as to the appealable unreasonableness of a jury's answers concerning particular imputations, this Court must be convinced of error before it gives effect to a different evaluation of the same facts106. Absent error, this Court does not simply step into the shoes of the Court of Appeal and make the decisions again as it would in an intermediate appeal. To adopt that approach would be to mistake the function of this Court. In his reasons, McHugh J has analysed closely the possibilities upon the basis of which the jury in the present case might have reached the answers they did to imputations 1(a) and (b) to justify the jury's answers that the matter complained of did not in these respects carry the pleaded imputations. With respect, I regard that analysis as excessively defensive of the jury's answers and insufficiently attentive to the appellate court's performance of its independent 106 Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 879-880 [65]; 179 ALR 321 at Kirby function to protect a party against a manifestly unreasonable verdict, although the reasons for such error cannot be identified with exact precision. All that is involved here is a decision on whether the matter complained of carries the imputation107. It has already been judicially determined that it is capable of doing so. It remains to be decided by a jury whether, if it does, the imputation is in fact defamatory. It then remains to be decided by a judge whether any defence raised to justify, or excuse, or protect the publication can be made out and, in the light of the foregoing, whether, and if so in what sum, damages should be awarded. The point at which Mr Rivkin failed before the jury was, in this sense, the most preliminary point of all. There is a risk in an overly nice analysis of theoretical possibilities of the jury's reasoning concerning particular imputations of overlooking the language of the matter complained of taken as a whole, viewed in the context in which the imputations appeared. Although I concede that the decision on the Offset Alpine imputations is close to the borderline (and had that issue stood alone, it might not have succeeded) it was open to the Court of Appeal to conclude that the jury's answers were appealably unreasonable upon imputations 1(a) and (b) 108. No error on the part of the Court of Appeal has been shown. There is therefore no basis for this Court to substitute a different conclusion. The involvement in murder imputation: The second category of imputation which the Court of Appeal found that the jury had unreasonably rejected was to the effect that Mr Rivkin "was a person criminally liable in respect of the murder of [the deceased]". These were alleged to arise out of SMH1. As pleaded, the imputation contends that Mr Rivkin was "a" person criminally liable. It does not plead that he was "the" person so liable. There is no doubt that the article postulated the hypothesis of Mr Rivkin's involvement in the murder of the deceased. This was suggested as one of the possibilities being advanced for the reader's consideration. Various factual indications in SMH1 lent credence to the hypothesis. The suggestions disposing of the possibility of suicide; the position of the deceased's body at the foot of The Gap at a distance from its base difficult (on one view) to reconcile with a voluntary leap from a restricted space on the approach to the cliff; the deceased's father's asserted belief that she had been murdered; the suggested discovery by the deceased of Mr Wood and Mr Rivkin in sexual activity the day before the deceased's death; the explicit hypothesis of a contract killing which Mr Wood could not (but 107 Reasons of Callinan J at [186]. 108 cf reasons of Gleeson CJ at [1]; reasons of Callinan J at [192], [196]. Kirby Mr Rivkin by inference could) afford to pay for; and the possible implication of murder for sexual jealousy of the deceased or because the deceased was on the point of "blowing the whistle" about some of Mr Rivkin's business dealings. Whilst it is true that other hypotheses were postulated in the article, the inescapable inference and burden of the article was that one clear and unmistakable hypothesis was that Mr Rivkin was "a person criminally liable". Indeed, the power of that implication was strongly reinforced by the context of SMH1. It included the insinuative photograph of Mr Rivkin, the introductory image on the front page of SMH1 with superimposed photographs only of the deceased and Mr Rivkin and the words "Caroline's world and the Rivkin link – death of a model, page 11". This "header" together with the introductory words at the top of the article in SMH1 (" … many who knew her refused to believe it was suicide … ") placed emphasis upon the persuasiveness of the murder hypotheses. Of the two murder possibilities postulated, murder by contract killing is the last stated and apparently the most logical conclusion postulated by SMH1. The presentation of the competing hypotheses leaves this one as the final postulate that an ordinary, reasonable reader would carry away from a reading of SMH1 in sequence. It would be necessary to assume rose coloured glasses and a large pair of blinkers to conclude that the published statements, appearing in an apparently serious broadsheet such as The Sydney Morning Herald, did not carry the imputation pleaded as one of the postulated hypotheses. If the imputation was not intended, why the introductory caption, even intruding into the newspaper's masthead on page 1 of SMH1? Why the prominent photograph of Mr Rivkin at the head of the article? Why the repeated references to Mr Rivkin in the article? Why the prominent espousal of the belief that the deceased's death was not suicide? Why otherwise link Mr Rivkin to a café frequented by people who had criminal backgrounds? Why the postulation, in this context, of a contract killing, otherwise unexplained except by reference to the deceased's suicide (thought unlikely) and the deceased's discovery of matters personally or professionally discreditable to Mr Rivkin? Given that the pleader used the indefinite article ("a") I am unable to conclude that the Court of Appeal erred in reaching the decision that the jury could not reasonably reject pleaded imputation 3(a). For similar reasons, I find no error in the Court of Appeal's conclusion on the true innuendo case. A person who, in addition to reading SMH1, had also read the AFR article would have more readily inferred that Mr Rivkin was "a" person criminally liable in respect of the murder of the deceased. Such a conclusion was reinforced by the elaboration of the "BAD BUSINESS" and "the mysterious death of [the deceased]" featured in AFR. In the face of the clear suggestion that Mr Rivkin's "bad business" was somehow inextricably mixed up with the "mysterious death", reading the publications together would tend to Kirby reinforce in the mind of the reader of SMH1, the conclusion that Mr Rivkin was one of those "criminally liable" for the deceased's mysterious death. Why else link the two? Why else postulate Mr Rivkin's involvement as one of the possibilities? It is true that the matters complained of did not finally conclude that the second murder hypothesis was the truth. But that was not required by the imputation pleaded. Merely to postulate such a grave accusation as one of three possibilities, was in my view inevitably to carry the message of the pleaded imputation109. Certainly, that conclusion was open to the Court of Appeal performing its statutory function. Both The Sydney Morning Herald and The Australian Financial Review are generally accepted as serious journals. Each is sometimes described as a journal of record. These facts reinforce the seriousness with which an ordinary reasonable reader would view the linkage portrayed in the two articles between Mr Rivkin and the death of the deceased. To the extent that parts of the articles, especially when read together, present the hypothesis of Mr Rivkin's criminal involvement in the murder of the deceased, that was a most serious imputation to give widespread coverage in these newspapers, with the credence that the publication would entail. In our society, a public accusation of murder is amongst the most serious known to the criminal law. Where made by prosecuting authorities, it must be grounded in evidence carefully sifted and weighed by expert police and prosecutors convinced that they can sustain the charge beyond reasonable doubt. The fact that it is made by a serious newspaper to a very large readership, even as one of three competing hypotheses, made it much more likely that many ordinary reasonable readers would accept it as the hypothesis most persuasive to them. Such acceptance necessarily does harm to the reputation of the person so accused. In such a case those who publish the accusations must normally be prepared to justify or defend it. I am therefore unconvinced that the Court of Appeal erred in concluding that the jury's answers to the questions relating to the pleaded imputation 3(a) and the true innuendo were appealably unreasonable. The homosexual intercourse imputations: In most circumstances, it ought not to be the case in Australia that to publish a statement that one adult was involved in consenting, private homosexual activity with another adult involves a defamatory imputation. But whether it does or does not harm a person's reputation to publish such an imputation is related to time, personality and circumstance. Once, it was highly defamatory in many countries to allege, or 109 cf Bellino v Australian Broadcasting Corporation (1996) 185 CLR 183 at 228. Kirby suggest, that a person was a communist110. Now, in most circumstances, it would be a matter of complete indifference. The day may come when, to accuse an adult of consenting homosexual activity is likewise generally a matter of indifference. However, it would ignore the reality of contemporary Australian society to say that that day has arrived for all purposes and all people111. At least for people who treat their sexuality as private or secret, or people who have presented themselves as having a different sexual orientation, such an imputation could, depending on the circumstances, still sometimes be defamatory. The introduction of Mr Rivkin's postulated sexual activity with Mr Wood was not entirely innocent, given the context. Mr Rivkin was described as a married man with five children who, by implication, was leading a secret life. This hypothesis was confirmed by the reference to his "high degree of interest in good looking young men" and by his provision to Mr Wood (who arguably filled the description) of a car, clothes, furniture and apartment, by clear implication in exchange for sexual favours. In the context of an article describing two murder hypotheses for the death of the deceased, one of which postulated the engagement of a "contract killer", the suggestion of homosexual activity between Mr Rivkin and Mr Wood in SMH1 went beyond an imputation of marital dishonesty or adulterous promiscuity on Mr Rivkin's part. In the context, such a sexual liaison, inevitably introduced into the matter complained of, as it would be read by the ordinary reasonable reader, the imputation as pleaded. Once again, it is important to note the precise terms of the pleading. What the Court of Appeal upheld was not that the suggested act of homosexual intercourse between Mr Rivkin and Mr Wood had taken place but rather that the police had "reason to suspect" that it had. There was no error on the part of the Court of Appeal in concluding that the jury's answer, to the effect that the matter complained of did not carry such an imputation was appealably unreasonable. With respect, it would take a highly artificial view of the facts to arrive at the contrary conclusion. Here, after all, was the inclusion in an article of a specific imputation that arguably provided a motive that solved the riddle that the article was setting out to lay before the reader. Given the limited way in which the imputation was pleaded, no error appears that would authorise this Court to disturb the Court of Appeal's conclusion on imputation 3(c)(ii). In his reasons, Callinan J concludes, contrary to the Court of Appeal, that the jury's negative answer to the imputation pleaded to the effect that the 110 cf Cross v Denley (1952) 52 SR (NSW) 112 at 114-115; Braddock v Bevins [1948] 1 KB 580; Brannigan v Seafarers' International Union of Canada (1963) 42 DLR 111 cf R v Bishop [1975] QB 274 at 281. Kirby appellant had in fact engaged in homosexual intercourse with Mr Wood, was appealably unreasonable112. In my opinion, no error has been shown in the Court of Appeal's conclusion in this regard. Moreover, no notice of contention was filed for Mr Rivkin on this point. As this Court's record stands, I would not be prepared to treat the imputation in question 3(c)(i) as a matter before the Court113. I do not agree that 3(c)(i) contained a more serious imputation than that in 3(c)(ii)114. In terms at least, it was a reference to private conduct. The sting of the imputation lay in the suggestion that the police had suspicions about the matter. This implied that the police thought that it might be relevant to the death of the deceased. Otherwise, it was of no legal relevance to them. The associate of criminals imputation: This leaves only the appellant's challenge to the imputation put to the jury as question 3(d) arising out of SMH1. This was that "the appellant was a close associate of criminals". It is necessary to view this alleged imputation, like all the others, in the context of the matter complained of in SMH1. The words ascribed to Mr Wood describe Mr Rivkin's "closest cronies" as having "certain criminal backgrounds". This necessarily implies that they have criminal convictions, associations or connections. The context is also relevant to the suggestion that Mr Rivkin frequented a café that "has a reputation for being a hangout for ex-drug dealers …". The significance of the imputation is made immediately apparent both by the postulated second hypothesis of murder by a contract killer and by the large photograph showing Mr Rivkin seated at an unidentified venue with a large Bentley motorcar in the background, inferentially displaying his wealth elsewhere described or implied in the text. In the setting, any innocent reading of the accusations stated or hinted in the case of Mr Rivkin would border on the starry-eyed. Read in isolation, as words only, clever verbal hypotheses might be raised to excuse or explain the jury's answer on this imputation. That all the "rumours" about Mr Rivkin's "cronies" were untrue. That the reputation of the café as a "hangout" was false. That the "ex-drug dealers" had all reformed. That the "criminal backgrounds" were for jaywalking or existed in the distant past. 112 Reasons of Callinan J at [203]. 113 cf Leotta v Public Transport Commission of New South Wales (1976) 50 ALJR 666 at 668; 9 ALR 437 at 440; Water Board v Moustakas (1988) 180 CLR 491 at 497- 114 cf reasons of Heydon J at [220]. Kirby Nothing in the function of the Court of Appeal, performing its statutory duty, required that Court to take such an unrealistic approach. Performing a proper appellate reconsideration of the jury's answer in this respect did not require the Court of Appeal to clutch at the straws of unrealistic hypotheses that put a uniformly innocent gloss on an imputation that, in the context, partook of what the matter complained of itself described as a "most sinister" matter. The Court of Appeal did not err in concluding that, in this respect, the jury's verdict was appealably unreasonable. The foregoing conclusions leave many other hurdles for Mr Rivkin to overcome in a trial of his claim. The appellant said that it was a matter of fact for the jury in every case to decide what each pleaded imputation meant. So it was. But, by our law, it also remains for the Court of Appeal to perform its function. That function represents, in this context, one of the many instances in which our legal system rejects absolute and inflexible rules and permits an appellate court to intervene so as to prevent the risk of serious injustice where this is clearly demonstrated115. The jury's answer that the matter complained of did not carry the imputation that Mr Rivkin "was a close associate of criminals" is such a case. The Court of Appeal was correct to so conclude. No error is shown in its conclusion. An essential difference of approach: The essential difference between the approach that McHugh J takes to this issue116 (and which the appellant and some others have urged117) and the one that I regard as required by authority and by proper performance by the Court of Appeal of its appellate role, can now be identified. I am very mindful of what this Court and the Privy Council said in Hocking v Bell118, concerning appellate review of jury verdicts. In this Court, the case is often referred to, and given effect119. But neither Hocking v Bell, nor any 115 State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In Liq) (1999) 73 ALJR 306 at 331-332 [93]; 160 ALR 588 at 620-622. 116 See reasons of McHugh J at [17]-[22]. 117 eg Rolph, "Perverse jury verdicts in New South Wales defamation trials", (2003) 11 Torts Law Journal 28. The author at 47-49 points out that "flaws" in the s 7A procedure may help explain the incidence of appellate intervention which would not have occurred, or been appropriate, to a verdict following a comprehensive trial before jury of all issues, including defences. 118 (1945) 71 CLR 430; (1947) 75 CLR 125 (PC). 119 Naxakis v Western General Hospital (1999) 197 CLR 269 at 289 [58], 290 [59], 291-293 [64]-[65]; Puntoriero v Water Administration Ministerial Corporation (Footnote continues on next page) Kirby decision since of which I am aware, obliges an appellate court, performing its function of deciding an appeal from a verdict of a civil jury, to defer to the jury decision if there is the merest scintilla of evidence to support that decision. This is a common misreading of Hocking v Bell. It must be removed from legal thinking. In every case it remains for the appellate court to subject the jury verdict to analysis, allowing for difficulties inherent in the absence of reasons and in circumstances where only limited means are available to decide how the jury may have reached their conclusion. Nevertheless, the touchstone is – and should be – one of reasonableness. Nothing else would coincide with judicial authority. Nothing else would fit with the appellate court's duty as a receptacle of statutory power. Reasonableness, rationality and fair process lie at the very heart of our legal system120. There is no need to apologise for them, or to dispose of them, in deference to fictious or absolute notions or a blind faith in finality of legal process that has clearly miscarried. The position was explained by McHugh J in Fox v Percy121 in language that I would adopt, word for word, for application in this case122: "Juries give no reasons. Because that is so, appellate courts must act on the basis that the jury took that view of the evidence that was reasonably open to them and is consistent with their verdict. Nevertheless, in some cases no reasonable view of the evidence can support the verdict. In those cases the appellate court may intervene to set aside the verdict. That is what happened here. Whilst acknowledging the ingenuity of the demonstration by verbal analysis of the way the jury might have construed different parts of the matter complained of, then extended to an explanation of their answers taken as a whole, it is my view that sight has thereby been lost of what was "reasonably open" to the jury to conclude. Alike with the Court of Appeal, I would conclude that "no reasonable view of the evidence" in this case (being the publications) could sustain the jury's answers on the pleaded (1999) 199 CLR 575 at 586 [27]; Rosenberg v Percival (2001) 205 CLR 434 at 463 [90]; Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 877-879 [64]; 179 ALR 321 at 334-336; Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 499 [55]. I leave aside references in criminal appeals where the issues are different. 120 Whisprun Pty Ltd v Dixon [2003] HCA 48 at [122]-[123]. 121 (2003) 77 ALJR 989; 197 ALR 201. 122 (2003) 77 ALJR 989 at 1002 [71]; 197 ALR 201 at 219 (emphasis added). Kirby imputations in the four identified categories. It follows that the Court of Appeal did not err in its decision in those respects. Professor Fleming puts it well123: "In the past there was, it is true, a tendency to give perhaps undue weight to a possible innocent meaning124. Today, however … the courts will only reject those 'meanings which can only emerge as a product of some strained or forced or utterly unreasonable interpretation'125." The latter, with respect, is the characterisation I would give to the appellant's effort to explain the jury's answers in the four categories that are before this Court. The discretionary ordering of addresses Finding the applicable rule: It is therefore necessary to consider the third issue. Not only is there a specific ground of appeal directed to it. Conventionally, it is open to an appellate court, in disposing of an appeal from final orders, to consider appeals from interlocutory decisions that may have influenced the challenged disposition126. The suggested error of the primary judge in rejecting the application of Mr Rivkin's counsel to be allowed an address in reply was postulated as a possible explanation of the misapprehension by the jury of its proper function in respect of the answers held to have miscarried. It is first necessary to clarify the rule governing the order of addresses. With respect, I do not agree with the opinion of Meagher JA, in so far as his Honour concluded that Pt 34 r 6 SCR had no application to the "strange semi- interlocutory determinations called for by s 7A [of the Act]"127. It is true that the relevant rule was adopted before the enactment of s 7A. The form of "trial" there provided is certainly unusual and restricted. However, the rule was intended, as its terms indicate, to be one of general and continuing application. It therefore has effect on any mode of trial. The trial by jury called for by s 7A invokes the rule. There is no need to resort to the Supreme Court's inherent jurisdiction. The rule is expressed in perfectly ample and clear terms. 123 Fleming, The Law of Torts, 9th ed (1998) at 590. 124 eg Capital & Counties Bank v Henty (1882) 7 App Cas 741 of which it was said in Slim v Daily Telegraph [1968] 2 QB 157 at 187 the principles were never better formulated nor perhaps ever worse applied. 125 Jones v Skelton [1963] 1 WLR 1362 at 1370; [1963] 3 All ER 952 at 958. 126 Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 483 [6]; 494-497 [43]- 127 [2002] NSWCA 87 at [2] per Meagher JA. Kirby A rule founded on statute: I agree with McHugh J that, because the rule, made pursuant to statute, gives the trial judge the discretion to alter the order of addresses, it is a discretion that may not be used to negative the general rule128. The adoption of principles of universal application (as postulated in the Court of Appeal by Meagher JA129 and, ultimately, by Grove J130) runs the risk of challenging the essential postulate underlying the terms of the primary rule. A judicial gloss of such a kind upon a law, founded ultimately in statute, is impermissible. In Gerlach v Clifton Bricks Pty Ltd131, Callinan J and I dissented on this point. We did so in the context of the impermissibility of converting a discretionary power to dispense with a jury into a rule having that effect because of features universal to jury trials132. The majority of this Court in that case133 laid emphasis upon the scope of the discretion provided to the trial judge in a court to which is committed a multitude of such decisions134. The principle that McHugh J has expounded in this case is clearly right. It follows that Mr Rivkin was entitled in his appeal to challenge the primary judge's interlocutory decision on the order of addresses. However, he had his work cut out to succeed in such a challenge. Because (despite invitation) no application was made to the primary judge to give reasons for rejecting a variation from the normal order of addresses envisaged by the rule, Mr Rivkin was left with nothing but inferences and deductions to sustain his attack on the judge's conclusion. Upon one view, by proceeding with the trial according to the primary assumption of the rule (which merely follows the historical approach of common law trials rather than those in equity) Mr Rivkin might be taken to have waived any serious objection to the primary judge's ruling on his counsel's request, made at the outset of the trial. The provisions of Pt 34 r 6 SCR are ambulatory. There was nothing to stop Mr Rivkin's counsel at the trial, at the conclusion of the address for the appellant, to renew the application to be allowed a general or limited right of reply. This, counsel omitted to do. That fact suggests that those in Mr Rivkin's camp thought that it was enough to proceed 128 Reasons of McHugh J at [71]. 129 [2002] NSWCA 87 at [2] pars (iii) and (iv). 130 [2002] NSWCA 87 at [53] per Grove J. 131 (2002) 209 CLR 478. 132 (2002) 209 CLR 478 at 505-507 [74]-[79]. 133 Gaudron, McHugh and Hayne JJ. 134 (2002) 209 CLR 478 at 484 [8]. Kirby according to the standard established by the ordinary provision of the rule, affirmed by the primary judge's initial ruling. The standard stated in Pt 34 r 6 SCR is not inflexible; nor is it unreasonable. In answer to the concern that led Grove J to his "alternative view", namely that a plaintiff should have a right to an address in reply135 in order to answer an argument that was tenuous or silly, it is unnecessary to postulate a radical or global departure from the procedure primarily envisaged by the Rule to meet such an extreme case. To the end of the trial, it is open to the primary judge, within his or her discretion under Pt 34 r 6 SCR, to vary the ordinary practice and to permit a reply, for example to deal with such arguments. Alternatively (as in part in the present case), the judge may give instruction to the jury that calls attention to the responses available to particular arguments. Conclusion: no error at trial: It follows that I consider that Foster AJA was correct in rejecting any supposed special rules of universal application as to the order of addresses in proceedings under s 7A of the Act136. His Honour was right in emphasising the individual discretion of the trial judge, including where necessary to permit a right of reply to the plaintiff as an exception. This approach was informed by the applicable legal principles, rooted here in statute. With respect, the majority of the Court of Appeal erred in concluding otherwise. The error of the majority in the Court of Appeal on this point is important because it appears to have affected the conclusion reached that a general new trial should be ordered at which, in a case such as the present, the right of reply sought for Mr Rivkin could be exercised as a matter of principle. There is no such principle. The governing rule remains that stated in Pt 34 r 6 SCR. It applies to a jury trial conducted under s 7A of the Act. The Court of Appeal erred in ordering a general retrial Brevity of the jury's deliberations: This conclusion necessitates consideration of the fourth issue. Once the error in the primary judge's interlocutory ruling as to the order of addresses is rejected, the only suggested foundations to support the Court of Appeal's order for a general retrial were (a) that the length of the jury's retirement was so short, combined with the universal rejection of Mr Rivkin's imputations, as to suggest a misapprehension or miscarriage of the jury's function; and (b) that, otherwise, in the circumstances of established error on the part of the jury in the four identified categories of imputation, the requirements of justice obliged a general retrial on the footing 135 [2002] NSWCA 87 at [53]. 136 [2002] NSWCA 87 at [25]. Kirby that "some substantial wrong or miscarriage" had occurred in the trial137 indicating that the entire process had failed and obliging that it be recommenced. So far as the relatively short retirement of the jury is concerned, it is certainly true that, in the way that lawyers labour over the meaning of pleaded imputations, more time is often needed (and more has been consumed in these appeals) than the jury could have undertaken in their retirement of less than two and a half hours. However, the whole point of summoning a jury, and preserving the facility of jury trial in defamation cases (even if for limited purposes), is to secure the benefits of a different tribunal, comprised of lay members, participating over several days while counsel argue their respective cases. In this country, the jury may (indeed are expected to), discuss the case amongst themselves before their final retirement138. An appellate court has no way of knowing the way that the jury approached their task or reached their answers, evidence on such matters being forbidden139. So was the conclusion of Foster AJA140, in which Meagher JA agreed141, that the brevity of the jury's retirement and the universality of their negative answers sufficient to occasion "grave concern that the verdict was influenced by extraneous considerations"?142. To the extent that this conclusion entered into the consideration of the Court of Appeal in ordering a general retrial was it an erroneous factor that vitiates that part of the disposition? In the United States of America, a number of decisions have addressed the suggested brevity of a jury's formal deliberations and the argument that it evidences misconduct or bias in the jury or their failure to understand and perform their duty. Whilst courts in the United States have insisted that "neither the brevity of the time of the jury's deliberation nor the [verdict] if within the limits fixed by [law], indicates either passion, prejudice or caprice on the part of the jury or misconduct"143 (length of deliberation bearing no necessary 137 Pt 51AA r 16(1) SCR: see Gerlach (2002) 209 CLR 478 at 483-484 [7]. 138 Ng v The Queen (2003) 77 ALJR 967 at 978 [71]; 197 ALR 10 at 26. 139 Ellis v Deheer [1922] 2 KB 113 at 117-118, 121; Prothonotary v Jackson [1976] 2 NSWLR 457 at 461; Laws (No 2) (2000) 116 A Crim R 70 at 75 [25]-[26]. 140 [2002] NSWCA 87 at [7]-[8]. 141 [2002] NSWCA 87 at [1]. 142 [2002] NSWCA 87 at [8] per Foster AJA. 143 cf Wheeler v State of Tennessee 415 SW 2d 121 (1967). Kirby relationship to the "strength or correctness of their conclusions or the validity of their verdict"144) nevertheless, where deliberations are extremely short, courts have sometimes infered injustice consequent upon a failure of the process145. Many of the cases in the United States are reasoned in terms of constitutional rights to due process that have no exact equivalent in Australia146. A number of the cases involve jury retirements of only a few minutes after extremely long and complex trials involving much evidence147, which the instant trial did not148. Repeatedly, United States judges have remarked on the double aspect of prompt verdicts as possibly indicating a firm view on the part of the jury as to the absence of any belief in the merits of the complaining party's case149. The United States' judges have also stressed that "[w]e cannot hold an hour-glass over a jury"150. Only if, in the circumstances, the brevity is so extreme and disproportionate to the trial as to suggest bias on the part of the jury or a failure to apprehend their proper function, will courts intervene on such a complaint if otherwise the verdict is sustained by the evidence. This Court should approach the matter in a similar way. So approached, there is no foundation in the argument based on the short retirement of the jury in the present case to warrant a conclusion, on that ground, that the entire trial miscarried. Speculation on extraneous prejudice: That leaves only the residual concern expressed in the Court of Appeal that some blanket consideration of an extraneous kind might have influenced the uniformly negative responses of the jury (shown in the four categories to have been appealably unreasonable) so as to demonstrate such a miscarriage of the first trial that only a complete retrial of all issues could cure. 144 Williams v Bridgeford 383 SW 2d 770 (1964); Anglin v State of Tennessee 553 SW 145 Derewecki v Pennsylvania Railroad Co 353 F 2d 436 at 444 (1965); Nelson v Keefer 451 F 2d 289 at 295 (1971). 146 eg United States v Anderson 561 F 2d 1301 at 1303 (1977). 147 Paoletto v Beech Aircraft Corp 464 F 2d 976 at 983 (1972). 148 Wheeler v State of Tennessee 415 SW 2d 121 at 127 [13] (1967). 149 eg United States v Anderson 561 F 2d 1301 at 1303 (1977). 150 Marx v Hartford Accident and Indemnity Co 321 F 2d 70 at 71 (1963). Kirby I am unconvinced that that is the correct inference to draw. It amounts, as Grove J ultimately expressed it, to "speculation"151. The conduct of a complete retrial would deprive the appellant of the success it has secured from the first trial, to the extent that the jury's answers to questions in that trial have not been shown as appealably unreasonable but have been upheld by the Court of Appeal applying the correct principles. No proper basis has been established to produce a different result. The several bases mentioned in the reasons of the Court of Appeal are insufficient. Justice as between the appellant and Mr Rivkin requires that any future trial be confined to the imputations in the four categories alone in which Mr Rivkin demonstrated appealable error on the jury's part. Conclusion: a limited retrial: Appealable error, of itself, is insufficient to warrant an order for a retrial where the first trial was had by jury. Under the applicable Rules of Court governing orders of the Court of Appeal in such cases (as at common law)152 it is necessary to show, in addition, that "some substantial wrong or miscarriage has been thereby occasioned". In the present case, that element is shown by the return of the jury with answers that were appealably unreasonable in the four categories of imputation found by the Court of Appeal. In respect of such imputations, but in respect of them alone, Mr Rivkin was entitled to a retrial. The Court of Appeal erred in granting a general retrial. Its order in that respect must be set aside. Orders The appeal should be allowed. Order 4 of the orders of the Court of Appeal of the Supreme Court of New South Wales of 26 March 2002 should be set aside. In place of that order, it should be ordered that the matter be remitted to the Common Law Division of the Supreme Court for a new trial limited to imputations 1(a), 1(b), 3(c)(ii) and 3(d). I agree that there should be no order for costs. 151 [2002] NSWCA 87 at [112]. 152 Pt 51AA r 16(1) SCR; cf Balenzuela v De Gail (1959) 101 CLR 226 at 242-244. Callinan CALLINAN J. The primary question which this appeal raises, is whether the intervention of an appellate court to correct the holdings of a jury that defamatory imputations as alleged by a plaintiff had not been conveyed, was justified. The facts The late Caroline Byrne was an attractive young woman who lived with Mr Gordon Wood, an employee of the respondent whom the appellant described as a celebrity stockbroker. Ms Byrne's body was found at the base of a tall cliff at Watson's Bay in Sydney on the morning of 8 June 1995. The appellant is the publisher of the Sydney broadsheet, The Sydney Morning Herald and another morning newspaper, The Australian Financial Review which, as its name suggests and the subject matter of the articles demonstrates, is primarily concerned with matters of business and finance. The appellant published a deal of at least impliedly critical matter in those two newspapers about Mr Wood and the respondent, and some of the details of an inquest that was conducted into the circumstances of Ms Byrne's death. It is necessary to set out in full (with the addition of numbering for subsequent ease of reference) the three articles which the respondent alleged were defamatory of him. The Australian Financial Review, 21-22 February 1998 at 1, 23-25. IT'S A BAD BUSINESS 2. What was going through the mind of well-connected Sydney model Caroline Byrne in the hours before her mysterious death? Neil Chenoweth reveals new information about the events surrounding the death, disclosing details of a secret investigation into some controversial business dealings. Sydney has developed an obsession with the death of a 24-year-old model. Intense media coverage in the last fortnight has centred on the mysterious events surrounding the discovery of the body of Caroline Byrne at the foot of a 30 metre cliff at the Gap, a well-known Sydney suicide spot, almost three years ago. Last week the Senior Deputy State Coroner, John Abernethy, returned an open verdict on Byrne's death, finding that she either jumped, slipped or was pushed from the top of the cliff on the night of June 7, Byrne had been referred to a psychiatrist by her general practitioner two days before, complaining of depression, though the doctor stressed at the inquest that she did not feel Byrne was suicidal. Callinan But inquiries by The Australian Financial Review have raised a possibility that an Australian Securities Commission interrogation of her boyfriend the day before her death may have contributed to her depression. Caroline Byrne's partner, Gordon Wood, 32, was served a Section 19 order by the ASC on May 31, 1995, together with Wood's employer, high-profile investor Rene Rivkin. The Section 19 order required Wood and Rivkin to submit to a formal examination by an ASC legal team. Caroline's father, Tony Byrne, testified in a statement at the inquest that Wood declined an offer to come to dinner on May 31. Caroline told him, "No, he's in a shitty mood." The ASC questioned Wood and Rivkin on Tuesday, June 6, Rivkin's birthday, over the recent trip the two had taken to Zurich, and in connection with its investigation of secret holdings in Rivkin's Offset Alpine Press Group by mystery Swiss investors. If this did contribute to the pressures upon Wood and indirectly upon Byrne, this could make her a victim of the long-running Offset Alpine saga, where the ASC tried in vain to trace what appeared to function as a $40 million slush fund. 10. Key details about the movements of Byrne and Wood in the month before her death can be ascertained from papers filed before the Federal Court of Appeal relating to Offset Alpine. They outline the pressures a major ASC investigation can produce. 11. Byrne had moved in with Wood in late 1992. Wood lived a life of expensive cars and cosmopolitan style from October 1993, when he became a driver and "gofer" for Rivkin. Rivkin had 18 cars ranging from a red utility and a blue Rolls-Royce Corniche convertible to a green Bentley. "I suppose by the time I left [in February 1996] I would call myself – sometimes I was like – like a manager, but I called myself a personal assistant," Wood told police in an interview tendered to the inquest. 13. During Wood's employment Rivkin's fortunes were on the rise. He had controlled the public company Offset Alpine, in its various incarnations, since the 1980s. By 1992 the company was stripped and virtually moribund. But the share price was galvanised when it bought a printing business from Kerry Packer's recently floated Australian Consolidated Press group at a price three times pre-tax earnings. Callinan [Sub-heading] Bad business: the mysterious death of Caroline Byrne 14. Another share price jump came after a fire on Christmas Eve, 1993, which resulted in a $53 million insurance payout, including $42 million to replace plant that was valued in the books at $3 million. 15. But Rivkin's reputation as a canny and astute broker took a battering in May 1995 when the ASC took legal action to freeze a major part of Offset Alpine's share register. In the Federal Court on May 3 the ASC revealed that the major beneficiaries of Offset Alpine's change in fortune were two Swiss companies which, by ignoring Australian reporting requirements, secretly owned 38 per cent of the company, hidden in five Australian nominee companies (which, like Rivkin, were unaware of the size of the total holding). The ASC said the two companies, Bank Leumi le-Israel, and a finance company EBC Zurich, operated as a "black box" that hid the identity of their clients – the real owners of the shares. The Swiss shareholdings had cost about $15 million to build up over a number of years. The mystery owners had received capital repayments of about $10 million, and raised about $4 million in share sales in the past year. Eventually the Federal Court ordered that the shares frozen by the ASC be sold, with the $26.1 million proceeds released to the Swiss companies. 19. Neither the ASC nor the Australian Taxation Office ever traced the end of the money trail. The beneficiaries forfeited millions of dollars in tax and legal costs to hide their identity. No charges were ever laid, and no negative aspersions were ever drawn about any of those investigated by the ASC. It was not suggested at Byrne's inquest that the ASC matters were in any way linked with her death. Indeed, it appeared that the Coroner and police were not even aware of the ASC's interest. 21. But who were the mysterious clients behind Zurich who received the $40 million? Two months before the ASC court action, on March 6, Phillip Croll, managing director of Rivkin's broking house, Rivkin Croll Smith, had written to Australian Stock Exchange's surveillance chief, Jim Berry, stating that Rivkin had discretionary authority over the EBC Zurich and Bank Leumi share trading accounts. Callinan 23. After the ASC froze the shares on May 3, Croll told the ASC that he had misunderstood the relationship, and that Rivkin did not control the accounts. "I think you'll find that a little bit of knowledge can be a dangerous thing," Croll told the AFR on May 9 about his mistake. This would have been a tense time for all concerned. It was difficult for the Swiss companies, which were forbidden by Swiss law from disclosing the real identity of their clients. It was tense for the real owners of the shares, who were risking the loss of their entire investment to the ASC by instructing the Swiss companies not to name them. It also must have been a tense time for Rivkin and his personal assistant Gordon Wood, not merely because it now seemed that, unbeknownst to Rivkin, his company had had a covert takeover, but also because thanks to Croll's misunderstanding Rivkin himself had become a major focus of the ASC inquiry. [Breakout] It appeared that the Coroner and police were not even aware of the ASC's interest. This was the atmosphere in which Wood was working as Rivkin decided to fly to Zurich. In a transcript of an interview with the ASC tabled in the Federal Court of Appeal, Rivkin said EBC Zurich and Bank Leumi had been clients for more than 15 years. They did not understand Australian reporting requirements and were indignant at the ASC's move. He had put them in touch with his lawyer, John Landerer, who had recommended they engage Freehill Hollingdale & Page and Atanaskovic Hartnell. 28. Rivkin made the decision to go to Zurich the day after the ASC froze the shares. He flew out on Sunday, May 7, accompanied by Wood. "I felt it was the least that I owed them [EBC Zurich and Bank Leumi], to go over and talk to the various people involved," Rivkin told the ASC in a transcript of interview tabled in the Federal Court of Appeal. "I mean, I met some of their lawyers, for example, a lawyer, trying to explain what it was all about." 30. Rivkin arrived in Zurich with Wood on Monday, May 8, and spent five days in meetings with EBC Zurich and Bank Leumi staff. "Of course I tried to convince them to release, to issue the names of their customers or their clients as the best way to solve the whole problem," Rivkin told the ASC. Callinan 32. Rivkin and Wood flew to England on May 12, returned briefly to Zurich, then flew back to England. They arrived back in Sydney on Saturday, May 27. The ASC had kept their flight arrangements under surveillance, and on May 31 they were summonsed for a Section 19 examination. 33. On Tuesday, June 6, Rivkin told the ASC in the court transcript that EBC Zurich and Bank Leumi were fund managers which decided where to invest their clients' funds, often on his recommendation, and sometimes during a conversation with him. He had no idea who their clients were. (EBC Zurich and Bank Leumi later stated that they only ever acted as bare trustees, with investment decisions made by their clients. Justice Sackville found in the Federal Court that this was not inconsistent with Rivkin's statement.) 35. On Monday, June 5, Wood's girlfriend Caroline Byrne was referred to a psychiatrist, but she did not keep her appointment on Wednesday afternoon. Her general practitioner told the Coroner that Byrne did not appear in any way suicidal, and friends described her as a "normal, vibrant woman". 36. Wood told police that Byrne was depressed on Tuesday night, June 6. He is the last person known to have seen Byrne, at 1pm on Wednesday, June 7. He told police Byrne was out when he returned home that night. He went looking for Byrne after waking at 12.40am to find her still not home. The Coroner described aspects of the matter as puzzling. 38. Byrne died of massive head injuries some time between 1pm on June 7 and 4.30am on June 8. A senior rescue squad officer testified to surprise at the position of Byrne's body, 9 to 10 metres out from the base of the 30m cliff. A fence restricted any run-up to about 1.5m, on a particularly dark night when an onshore breeze was blowing. The Coroner said he was satisfied nevertheless that she could have jumped this far. The Coroner described Wood's testimony as "bizarre", with a number of "glaring inconsistencies". At the same time, he noted that Wood kept to his version of events in a lengthy record of interview with police. "Much of what Wood said has been independently corroborated by others," he said. Callinan 40. After first checking Byrne's father's home, Wood was able to find her car at the Gap because of "spiritual communication", he told police in an interview tendered to the inquest. With a barely operating torch he was able to see Byrne's legs and a sandshoe at the foot of the cliff. Later, policemen using much stronger lighting had difficulty locating the body. 41. Wood gave a string of false stories about Caroline's death to her friends, and even to Rene Rivkin's wife, that Byrne had been run down by a car. He said Caroline's father, Tony Byrne, had asked him to do this. 42. But the Coroner said the "most telling inconsistency" was the testimony of two restaurateurs who gave "convincing evidence" that they saw Byrne with Wood at the Gap at various times during Wednesday afternoon, as well as a green Bentley. "It would be totally against the weight of evidence not to accept that evidence of identification," the Coroner said. 44. Wood testified that on that last afternoon he did not see Byrne after lunchtime, and that he spent the afternoon lunching with friends and driving Rivkin and his friend, former Labor politician Graham Richardson, in East Sydney. Neither Richardson nor Rivkin gave evidence. Nevertheless, the Coroner said, there is "not evidence that any known person was involved in the death of Caroline Byrne. It simply arouses suspicion and suspicion is not evidence". 45. Another source of potential upset for Byrne was Wood's close relationship with Rivkin. In a transcript of a police record of interview tendered at the inquest, Wood said: "He was sort of like a father to me, if you like, as well as a boss." Wood said Rivkin advised him how to treat Byrne though Caroline had "a lot of suspicions about him". This related partly to the colourful crowd at Rivkin's favourite coffee shop, Joe's Cafe in Kings Cross. 47. Byrne's death initially had been treated as a suicide. Wood was questioned by homicide detectives in an inquiry which was launched eight months later, after a request by the Coroner's office. In the transcript of interview tendered, Sergeant Brian Wyver levelled a number of allegations against Wood, which Wood denied and for which no substantiation was provided. It appears police were exploring the different pressures that may have been upon Byrne and Wood at the time. Byrne's mother committed suicide in 1991, and in 1992 Caroline Byrne had taken an overdose of sleeping tablets in the bath. Callinan Independently of this tragedy, the Offset Alpine litigation ploughed along, with Justice Sackville eventually ordering that the shares be sold into a current takeover bid, and the money released to the Swiss companies. 50. An appeal was dismissed by the ASC, and the funds were about to be released in October 1996 when the Tax Office entered the fray, charging tax at the top marginal rate. EBC Zurich had told the Australian Securities Commission that its clients were from "all over the world". Counsel for the Tax Office described plans to send the funds to Zurich as "a little bit cute". "Transmitting it to Zurich to invest in Australian dollars is a curious thing to do," he said. 52. Within a week the mystery shareholders had done a deal with the ATO, which it is believed resulted in them paying millions of dollars as tax – considerably more than the 15 per cent withholding tax that non- Australians would pay. This suggests the mystery shareholders are Australian. 53. Gordon Wood continued as personal assistant to Rivkin until February 1996. He now describes himself as a share trader. 54. According to the ASC records Wood had already branched out with his own interests in February 1995 with Shammas Ltd, a management consultancy/investment company he owned with accountant Anthony Tighe. In June 1995 Shammas reported an operating profit of $677, assets of $4,963 and liabilities of $5,636. Sergeant Wyver, of the homicide squad, was assigned to the investigation of Byrne's death on February 27, 1996. He has since been transferred to the Child Protection Unit and moved to Wollongong. The investigation continues. The Sydney Morning Herald, 25 February 1998 at 1, 11. CAROLINE'S WORLD AND THE RIVKIN LINK When the body of Sydney model Caroline Byrne was found at the bottom of The Gap, many who knew her refused to believe it was suicide. BEN HILLS looks at evidence presented to the Coroner. DEATH OF A MODEL Even at six o'clock on a winter morning, Caroline Byrne would turn heads. Tall, blonde and well-built, she had just come from a casting Callinan session at her modelling agency and was looking "marvellous", her father recalls, when they met at the apartment block near Sydney's Chinatown where he worked as the building manager. They had some family business to transact, papers to sign relating to a $2 million family trust set up by Tony Byrne for his four children. Caroline's share would be $500,000. Rich, attractive, successful, the only hint of gloom in Caroline's life that morning was a call on the mobile phone from her live-in lover "Gordy" Wood, whom, she said, was "in a shitty mood". It was May 31, 1995, an otherwise uneventful day. There was certainly no clue that this was the last time Tony Byrne would see his daughter alive. Eight days later a police helicopter would airlift her shattered body from rocks at the foot of a 30-metre cliff near the entrance to Sydney Harbour, "a terrible waste of such a beautiful young life", as Tony Byrne later wrote to police investigating the death, in a letter on file at the Coroner's Court. Two and a half years later Byrne is still full of grief and anger: grief at his daughter's death, and anger because no-one has been brought to account for what he believes was not a suicide but a cold-blooded killing. Caroline, he wrote, was murdered by a contract killer because she knew too much, the most extraordinary of all the theories yet to come to light about her death. The inquest which was held earlier this month only threw more fuel on the bonfire of speculation. After hearing and reading statements from dozens of witnesses (including Byrne), examining a cache of forensic evidence and ordering a fresh, more thorough, investigation by the police, the Coroner, John Abernethy, was unable to determine how Caroline Byrne had died. He left open three possibilities: suicide, murder or an accident. In other words, she jumped, she was pushed, or she simply slipped and fell to her death some time between 3.47 pm on June 7, when the records show she (or someone who knew her PIN number) withdrew $50 from a Westpac auto-teller machine in Vaucluse, and 3.30 the following morning when her body was found at the Watson's Bay Gap, a popular suicide spot. SUICIDE. Superficially, Caroline Byrne was a woman with everything to live for. "I found her to be a very calm person, a very well- balanced individual. She was a role model for all our students ... [and] at no time showed any signs of depression," stated her former boss, Carol Clifford, manager of the famous June Dally-Watkins modelling school where Caroline had taught "deportment and parade" part-time for three years. Callinan Aged 24, she had been brought up on a farm the family once owned near Camden, and had an arts degree with a major in psychology from Sydney University. At the age of 17 she was crowned "Miss Spirit" at the Campbelltown Ghost Festival, and she began modelling professionally when she was at university. Her relationship with Gordon Wood also appeared to be serious and stable. They met at a gym where Wood, now aged 34, was working as a trainer, and had been living together on and off for 2 1/2 years. In one of his statements to police, Wood said they planned to marry and have children, and added: "We were very much in love with each other ... I considered living with Caroline as a dream come true." 10. During a three-month separation from Wood in 1993 she went out with an older man; her medical records show that she had two (negative) HIV blood tests. She was fit and active and didn't drink alcohol or do drugs. When pressed, Wood admitted to police that just once they had shared an "eccy" (ecstasy) tablet and that Caroline had had "three or four puffs" of So why would she kill herself? There was one dark chapter in her past of which Wood was aware. At Easter in 1991, Caroline's mother had checked herself into a Kings Cross hotel and killed herself with an overdose of drugs and alcohol, apparently as a result of depression which began with a silicone breast implant which went wrong. 14. Nine months later, Caroline herself, mourning her mother, tried to commit suicide by talking sleeping pills and lying in a bath full of water. That attempt failed, as (according to Wood) did a later attempt to jump off a building. Caroline had consulted a psychiatrist and been prescribed medication. 15. Nor, according to her family and friends who disapproved of him, was her relationship with Wood entirely blissful. Caroline's father said: "Gordon would not let Caroline out of his sight. It was not uncommon for him to call her 10 times a day. He always knew exactly where she was." 16. Detective Senior Constable Brian Wyver of the Homicide Unit South, who was in charge of the re-investigation, reported: "All her friends ... express doubts about Gordon Wood. They describe him as unusual. It would appear that he was obsessed by Caroline Byrne, and the view seems to be that even though he was living in a de facto relationship with her, he in fact stalked her." Callinan 17. Adding strength to the suicide theory, Caroline went to her GP, Dr Cindy Pan, two days before her death complaining that she had been feeling depressed for a month, and particularly in the previous week. Pan referred her to a psychiatrist (the appointment was for the afternoon she went missing), saying that the cause of the depression was unknown, but insisting that Caroline had "no thought of self-harm". The cause of her depression remained a mystery until police interviewed Wood. According to him, Caroline was unhappy with a new, full-time job in sales and promotion for June Dally-Watkins; so unhappy that the two of them concocted a story for her boss that Caroline was seriously ill, and were planning to take a week-long "sickie" for a trip to the Blue Mountains. In a 14-page posthumous case analysis, psychiatrist Dr Neil Schultz weighed the odds of suicide thus: "On face value [the evidence of Caroline's father and friends] the risk of Ms Byrne committing suicide is low. It rises to moderate on Dr Pan's evidence, and to high [accepting] Gordon Wood's version [of events]." 20. Caroline skipped an appointment the afternoon before her death ("totally out of character", said a modelling friend) and was, again unusually, still in bed a bit before 1 pm the following day when Wood returned to their apartment in Pott's Point to take her for lunch. Wood said she told him she had taken one of his Rohypnol (a sedative) tablets – he thought there were five or six missing from the packet – and did not want to get up. [Breakout] 'I found [Caroline Byrne] to be a very calm person, a very well-balanced individual' Carol Clifford That, says Wood, was the last time he saw his lover alive. He went back to work – he had been chauffeur and "executive assistant" to the celebrity stockbroker Rene Rivkin for nearly two years – returned that night to an empty apartment, and did not raise the alarm until after midnight when he awoke after falling asleep in front of the TV to find her still missing. 22. On this version of events, Caroline drove her white soft-topped Suzuki Vitara 4WD through Sydney's eastern suburbs that afternoon. At 3.32 pm (according to a credit-card receipt found in her handbag) she stopped at a Caltex service station in Oxford Street, Paddington, where she spent $7.75 on petrol and what might have been her last meal, two chocolate Freddo frogs. Callinan She then drove to The Gap, parked her car in a narrow lane, and took a running jump off the cliff. How do we know it was a running jump? Her body was found nearly 10 metres out from the base of the cliff, which would have taken a "fairly good run-up", according to Sergeant Mark Powderly, the police rescue expert who recovered the body. Either that, he testified, or it was "not inconceivable" that someone threw her off. 25. MURDER 1. Initially, the case was written off as just another suicide at The Gap. In his report, Constable Craig Woods of Rose Bay police, who conducted the original investigation concluded: "I believe the deceased was suffering from depression and that she could no longer cope with this and has attended The Gap some time after 3.45 pm on June 7 and has taken her own life." 26. However, after pressure from Tony Byrne, who wrote complaining that the initial investigation was inadequate, the Coroner ordered police to reopen inquiries, and the case was put in the hands of Sen Const Wyver, who focused on a number of inconsistencies in the evidence of various witnesses. 27. Wood, for example, had denied ever being near The Gap that afternoon, but the police found two witnesses who, while on the balcony of the Bad Dog cafe at Watson's Bay, had spotted a woman with a "very striking appearance, like a model" walking and chatting with two men. In the foyer of the Coroner's Court, they identified Wood and a Melbourne model-booking agent named Adam Leigh, who also knew Caroline, as the men. 28. When Wyver tackled Wood about this, and about a sighting of Rivkin's green two-door Bentley in the area that day, he said: "It's entirely possible, but I'm pretty sure I didn't [go there]." 29. He said that Rivkin had 14 cars, including a Rolls-Royce Corniche, a Bentley and a Ferrari. Because they were not used much, one of his duties was to drive them around to charge up the batteries, and this might have been what he was doing with the Bentley. 30. Wood and Leigh "trenchantly denied being with Ms Byrne" that afternoon, said the Coroner, but he found it "truly coincidental that both men strongly identified as being with Caroline knew her very well indeed, so well as to be material witnesses to this inquest". Abernethy described this as a "telling inconsistency" in the evidence. Callinan Police, and Caroline's relatives, were also puzzled by Wood's behaviour after he awoke in front of the TV to find her missing. He picked up Tony and Peter Byrne (her brother) and drove to The Gap where, after searching for some time, he said he spotted her leg and sandshoe by the weak light of a torch he borrowed from two rock fishermen. 32. When Wyver questioned him about this, he said he had been led to the body by "some kind of spiritual communication". The Coroner described Wood's account as a "glaring inconsistency" and found "another anomaly" in the way Wood later lied to a number of Caroline's friends, telling them that she had been killed by a car. 33. An interview tendered as an exhibit during the inquest showed one possibility the police were exploring. The transcript reads: 34. Wyver: Now, I have been informed that on the day of Caroline's death she did not in fact attend work, but she made surveillance of you and in the course of this surveillance she caught you and Rene [Rivkin] having homosexual intercourse. What can you tell me about that? 35. Wood: Absolute lies. 36. Wyver: OK, and then I have been informed that as a result of that an argument between her and you ensued. Is there anything ... 37. Wood: No. 38. Wyver: ... and that you went to The Gap and you threw her over The Gap. 39. Wood: No, that's not correct, not correct. 40. Wood worked for Rivkin from 1993-96, starting as a "driver-gofer" and becoming his "executive assistant". He travelled extensively in Australia and overseas with Rivkin, regarded him as a "father as well as a boss", and was learning about "stockmarkets and trading" from him. Rivkin bought the apartment Wood and Caroline lived in at Potts Point, and paid for a car, clothes and furniture. 41. Wood, who now describes himself as a stockmarket trader, said that he had left Rivkin in 1996 "because I had this dream of getting myself financially set up to take care of Caroline and the family we were planning to have, and when she died that sort of died with her". 42. He said in the interview that Caroline, with whom he was living in what he described as a "loving, happy relationship", was "suspicious" of Rivkin. Asked why, Wood said "... [Rivkin] used to hang out with a whole stack of people at the cafe which, I am sure, you probably Callinan discovered has a reputation for being a hangout for ex-drug dealers ... "Some of Rene's closest cronies are ... have certain criminal backgrounds or are rumoured to have it. And the fact that Rene is ... has a high degree of interest in good-looking young men ... so she [Byrne] certainly expressed concern about his intentions towards me." 44. But Wood denied he had ever had a homosexual relationship. He said in his opinion Caroline had committed suicide by jumping off the cliff. 45. Neither Rivkin nor Wood would return telephone calls from the Herald. Wood was not questioned about this allegation during the inquest, nor was Wyver asked the source of his information. 46. Rivkin, who is married with five children, was not called as a witness and did not make a statement to police apart (says Wyver) from a brief "door-stop" outside one of his haunts, Joe's Cafe in Darlinghurst, several months later when he said he could not recall whether Wood had been driving him the day Caroline died. 47. MURDER 2. The most sinister theory about Caroline's death is her father's belief that a "contract killer" was hired to do away with her. In his letter to police and the Coroner, Tony Byrne says his daughter was "knocked unconscious a short distance from where she was found, and thrown over the cliff". 48. Byrne makes an extraordinary series of allegations about people he claims were behind the murder. The motive? She had found out about "a very serious crime" from which they stood to benefit, and they feared she was about to blow the whistle. 49. He has offered to put up a $100,000 reward for information leading to the conviction of her killers. He says her death shows "how easy it is to make a murder look like a suicide". The police investigation did not take into account Byrne's theory, no statements were taken or witnesses called, and Abernethy does not mention the allegation in his official finding. 51. As far as the police are concerned, Wyver says, the file remains open. The Sydney Morning Herald, 5 March 1998 at 7. Callinan BOYFRIEND DENIES KILLING MODEL The fiance of a model who was found dead at the bottom of The Gap two years ago broke his silence on national television last night, saying suggestions he was responsible for her death were "utter lies" and "garbage". 4. Mr Gordon Wood, who was engaged to marry Ms Caroline Byrne before her death in May 1996, told the Seven Network's Witness program that suggestions made in a police interview that he had thrown Ms Byrne off The Gap after surveillance she commissioned allegedly caught him having sex with his boss, the flamboyant stockbroker Mr Rene Rivkin, were "utter lies". "Utter garbage. There's absolutely no evidence to support that Caroline had hired anybody or that Rene Rivkin had homosexual sex with me or anybody," Mr Wood said. An inquest into the death of Ms Byrne recorded an open verdict last month, although the Coroner called on police to reopen the investigation into how she died. The program said that despite the Coroner's suspicions that Mr Wood might not have been telling the truth, there was "not a shred of evidence that Gordon Wood killed Caroline". 8. When asked if he had killed Ms Byrne, Mr Wood replied: "Of course not. Why would I kill her?" Detective Brian Wyver, who investigated the death, said on the same program he did not think Ms Byrne had committed suicide and that the evidence indicated Mr Wood had told lies. "If I thought that she'd committed suicide then it would make it a lot easier to give a version to the Coroner ... I don't think she really did," Detective Wyver said. "There are a lot of inconsistencies in his story," he said of Mr Wood. 12. Mr Wood claimed he had not lied once. Callinan "Tell me this, why would I lie about anything to do with the death of the woman I was expecting to live the rest of my life with – happily ever after," he said. "There is no explanation on the face of the planet that makes sense, that has one iota of evidence to suggest that any other scenario is anything but a fantasy." 14. Ms Byrne's father, Mr Tony Byrne, told the program he believed his daughter was murdered. "She did not commit suicide," he said. The respondent sued the appellant for defamation in the Supreme Court of New South Wales. He alleged that the three articles conveyed a number of imputations which I collect in a convenient table later in these reasons. The form of pleading used in this case is apparently unique to New South Wales. A practice seems to have developed there of pleading in a formal way an imputation in different language from the defamatory matter itself, even when the clarity and defamatory thrust of the actual matter itself need no elaboration. Part 31 r 2 of the Supreme Court Rules 1970 (NSW)153, which makes provision for staged trials of actions, applied here. Section 7A of the Defamation Act 1974 (NSW) ("the Act"), which was introduced by the Defamation (Amendment) Act 1994 (NSW) and which was also applicable to these proceedings, provides as follows: "7A Functions of judge and jury If proceedings for defamation are tried before a jury, the court and not the jury is to determine whether the matter complained of is reasonably capable of carrying the imputation pleaded by the plaintiff and, if it is, whether the imputation is reasonably capable of bearing a defamatory meaning. 153 Part 31 r 2 provides: "[31.2] Order for decision The Court may make orders for: the decision of any question separately from any other question, whether before, at or after any trial or further trial in the proceedings; and the statement of a case and the question for decision." Callinan If the court determines that: the matter is not reasonably capable of carrying the imputation pleaded by the plaintiff, or the imputation is not reasonably capable of bearing a defamatory meaning, the court is to enter a verdict for the defendant in relation to the imputation pleaded. If the court determines that: the matter is reasonably capable of carrying the imputation pleaded by the plaintiff, and the imputation defamatory meaning, reasonably capable of bearing a the jury is to determine whether the matter complained of carries the imputation and, if it does, whether the imputation is defamatory. If the jury determines that the matter complained of was published by the defendant and carries an imputation that is defamatory of the plaintiff, the court and not the jury is: to determine whether any defence raised by the defendant (including all issues of fact and law relating to that defence) has been established, and to determine the amount of damages (if any) that should be awarded to the plaintiff and all unresolved issues of fact and law relating to the determination of that amount. Section 86 of the Supreme Court Act 1970 and section 76B of the District Court Act 1973 apply subject to the provisions of this section." The first stage of the trial came on for hearing before Simpson J with a jury. The only evidence before the court consisted of the three articles. The respondent's counsel addressed first. Following his and the appellant's counsel's addresses the trial judge rejected an application by the former to address the jury in reply. The questions for the jury were whether each of the imputations was conveyed, and if it was, whether it was defamatory of the respondent. Section 7A of the Act dictated that these be answered by the jury exclusively. Because the jury answered the first set of questions entirely in the negative, the appellant became entitled to judgment in the action. Callinan The respondent in this Court appealed to the Court of Appeal of New South Wales (Meagher JA, Foster AJA and Grove J). That Court unanimously held that six of the imputations pleaded were, but nine were not, necessarily conveyed, and that even though the jury were not perverse in rejecting some of the imputations, there should be a new trial in relation to all of them. The respondent also relied on a ground that he should have been permitted an address in reply. As to that, it was held that the order of address is a matter in the discretion of the trial judge. Subject to that discretion, particularly in a case in which the evidence consists of no more than the tender of the matter complained of, the plaintiff should ordinarily address first (per Meagher JA and Foster AJA, Grove J contra), but should have a right of reply (per Meagher JA and Grove J). Foster AJA was of the opinion that any right of address in reply should be in the discretion of the trial judge in accordance with the circumstances of the case. With respect to the substantive matters, the conveyance or otherwise of the imputations, Grove J wrote the leading judgment. His Honour accepted that the burden upon the respondent in attacking the answers of the jury was a very heavy one. Indeed, the test that his Honour adopted, of perversity, was probably higher than required unless it was intended as a synonym for the phrase, a conclusion that no reasonable jury could reach. It is convenient to repeat, with two additional columns, the table in which the appellant collected the imputations and the holdings in respect of them by the jury and the Court of Appeal. The columns that I have added are the first and second ones. They contain the matter principally, but not exhaustively, relied on by the respondent, as supporting the imputation pleaded and the publication in which it appeared. Matter of particular reliance Pars 1, 7, 31 and Publication and date Imputation AFR February That the [respondent's] participation in the affairs of Offset Alpine Press Group had diminished his reputation as a sagacious and astute stockbroker Imputation reference (as pleaded and as put to the jury) Jury answer Court of Appeal holding Pleading: 4(a) Jury: 1(a) Unreasonable or perverse Callinan Pleading: 4(b) Jury: 1(b) Unreasonable or perverse Pleading: 4(c) Jury: 1(c)(i) Not unreasonable Pleading: 4(d) Jury: 1(c)(ii) Not unreasonable Pleading: 6(a) Jury: 3(a) Unreasonable or perverse That in May 1995 the Australian Securities Commission had reason to suspect that the [respondent] had engaged in unlawful conduct in connection with the affairs of Offset Alpine Press Group That the late Caroline Byrne had reason to suspect that the [respondent] had involved unsavoury business dealings connected with the affairs of Offset Alpine Press Group; or That the late Caroline Byrne suspected that the [respondent] had involved unsavoury business dealings connected with the affairs of Offset Alpine Press Group That the [respondent] was a person criminally liable in respect of the murder of the late Caroline Byrne AFR February Pars 1, 7, 31 and Pars 6, 8, and 46 AFR February Pars 6, 8, and 46 AFR February SMH February The headline; Pars 2, 4, Callinan SMH February That the father of the late reason to suspect that the [respondent] was a person criminally liable in respect of her murder; or SMH February That the father of the late that the [respondent] was a person criminally liable in respect of her murder Pleading: 6(b) Jury: 3(b)(i) Not unreasonable Pleading: 6(c) Jury: 3(b)(ii) Not unreasonable That the [respondent] had engaged in homosexual intercourse with Gordon Wood; or That the police had reason to suspect that the [respondent] had engaged in homosexual intercourse with Gordon Wood That the [respondent] was a close associate of criminals That the [respondent] was a person criminally liable in respect of the murder of the late Caroline Byrne Pleading: 6(d) Jury: 3(c)(i) Not unreasonable Pleading: 6(e) Jury: 3(c)(ii) Unreasonable or perverse Pleading: 6(f) Jury: 3(d) Pleading: 7(a) Jury: 5(a) Unreasonable or perverse Unreasonable or perverse SMH February SMH February SMH February AFR February 1998 and SMH February The headline; Pars 2, 4, The headline; Pars 2, 4, Pars 34, and 43 Pars 34, and 43 Pars 42, and 47 The matter relied upon consists of a combina- tion of the pars referred to above in respect of the like imputa- tions there referred See above See above Par 4 Par 4 AFR February 1998 and SMH February AFR February 1998 and SMH February SMH 5 March SMH 5 March Pars 4 and 9. SMH 5 March Pars 4, 9 and 13 SMH 5 March That the father of the late reason to suspect that the [respondent] was a person criminally liable in respect of her murder; or That the father of the late that the [respondent] was a person criminally liable in respect of her murder That the [respondent] had engaged in homosexual intercourse with Gordon Wood That the police had reason to suspect that the [respondent] had engaged in homosexual intercourse with Gordon Wood That the late Caroline Byrne had reason to suspect that the [respondent] had engaged in homosexual intercourse with Gordon Wood; or That the late Caroline Byrne suspected that the [respondent] had engaged in homosexual intercourse with Gordon Wood Callinan Pleading: 7(b) Jury: 5(b)(i) Not unreasonable Pleading: 7(c) Jury: 5(b)(ii) Not unreasonable Pleading: 9(a) Jury: 7(a) Pleading: 9(b) Jury: 7(b) Not unreasonable Not unreasonable Pleading: 9(c) Jury: 7(c)(i) Not unreasonable Pleading: 9(d) Jury: 7(c)(ii) Not unreasonable Notwithstanding that Grove J did not think that all of the jury's answers were perverse, the multiplicity of those that were, and the apparently undiscriminating rejection of all of the imputations, required that there be a fresh trial in respect of the totality of them. He said154: "The persistently negative answers by the jury to all questions whether an imputation had been conveyed were therefore in my opinion perverse in respect of those above identified emerging from the AFR 154 Rivkin v John Fairfax Publications Pty Limited [2002] NSWCA 87 at [109]-[113]. Callinan article and the first Herald article and on the true innuendo case but not perverse in respect of others above identified and alleged to emerge from the same publications. None of the negative answers in respect of the second Herald article was in my opinion so perverse. The question then arises as to whether a new trial should be ordered in respect of only those imputations in respect of which perversity of answer has been found. Even where the negative answer has not been found perverse in relation to a pleaded imputation, there were nevertheless arguments capable of supporting the [respondent's] contentions (including contentions supporting the pleaded imputations alleged to arise out of the second Herald article) and the refusal of the application for an address in reply (or the alternative of change in the order of address) must contribute to a determination whether there has been miscarriage attracting an order for new trial on some or all of the answers. The [respondent] (expressly in ground 2) sought to attach significance to the aggregation of negative answers. In the case of a number of these I have concluded that they were unacceptable in any of the terms of the tests as they have been expressed from time to time. It is not open to speculate upon why the jury may have persistently returned these negative answers. The issue of whether a meaning is conveyed by a matter complained of and whether it is defamatory does not involve assessment by the tribunal of fact of any matter touching upon the persona or reputation of a plaintiff, the truth of the imputation, privilege or other matters previously dealt with in a 'complete' libel trial but in the circumstances, that is to say constant rejection of the cause of a litigant in many cases in defiance of reasonableness, it is apt to conclude that the jury has misapplied itself to its task. In those circumstances I consider that there should be a new trial of all the imputations which were before the jury." Passages from the judgment of Foster AJA in which his Honour recorded his concern at the brevity of the jury's deliberations should also be quoted because of the respondent's reliance on them in this Court155: "Whilst it is true that the members of the jury might have had some time during the conduct of the case to discuss these complex questions in a preliminary way, I am satisfied, as a matter of common sense, that their main deliberations would necessarily have been confined to the period in which they were considering their verdict in the jury room, after having 155 Rivkin v John Fairfax Publications Pty Limited [2002] NSWCA 87 at [7]-[9]. Callinan had the benefit of counsels' addresses and the trial judge's summing-up. The Court was advised that the period of deliberation prior to verdict, was of the order of two hours, which included the ordinary lunch hour. For my part, I cannot accept that, in this significantly short period of time, the jury could have properly focused upon the complex issues of this case, even if one allows, in their favour, that they attended carefully to the addresses of counsel and the judge's summing-up. When I consider that the jury returned the answer 'no' to each one of the alleged imputations at the end of this significantly short period of deliberation, I experience grave concern that the verdict was influenced by extraneous considerations. Grove J's comprehensive analyses of the evidence and submissions relating to each imputation, including his Honour's conclusions that certain of them should be regarded as inevitably established (with which conclusions I respectfully agree) serve further to indicate that this jury failed properly to address its task. In particular, I am satisfied that it could not have given proper consideration to the powerful arguments on behalf of the [respondent] which posed the question why the [respondent] should have been referred to in the articles at all, let alone being accorded such extraordinary prominence in them." The appeal to this Court The applicable principles It is right, as the respondent submitted, that in finding that some of the answers of the jury were perverse, the Court of Appeal may have adopted a more demanding test than the law requires. As the cases to which Grove J referred and others show, the courts in the United Kingdom and this country, have from time to time used different language to state an appropriate test. The differences on occasions have been more than ones of subtle nuance: incontrovertible error156; an extreme case of unreasonableness157; a decision no reasonable jury could hold158; inherently wrong159; unreasonableness160; clear and beyond argument161; 156 Evans v Davies [1991] 2 Qd R 498 at 511 per Macrossan CJ. 157 Grobbelaar v News Group Newspapers [2001] 2 All ER 437 at 487 per Jonathan 158 Australian Newspaper Co Ltd v Bennett [1894] AC 284 at 287 per Lord Herschell LC. 159 Thompson v Truth and Sportsman Limited (No 1) (1929) 31 SR (NSW) 129 at 135 Callinan unreasonable [un]reasonable162; overwhelming and preponderance163; an enormously strong case164; and, wrong and completely unreasonable and unjust165. Grove J probably referred to perversity because he took the view that the rejection of all of the imputations amounted to no less than that. perverse, almost The fact that an appeal lies to the Court of Appeal does not mean that the Court may substitute the answer that it would give to a question for that of a jury. Nor does it mean that a finding of a jury should be invested with no more than the authority of a trial judge to whom all questions, including of fact, have been assigned for answer. The jury has an especially significant constitutional role to play in those cases in which it participates. Both as a practical and legal matter, a jury's decision on a factual question, although by no means impregnable, does have an authority over and above that of a decision of a judge sitting alone to determine a factual question. The jury is representative of the community. Its members are better placed than judges to give meaning to, and evaluate, the spoken and written word and its impact upon the community. Nor should it be assumed that juries approach their task with heightened or lowered suspicion and prejudice. History shows that not all lawyers and judges are strangers to suspicion. It may accordingly be accepted that the occasions for judicial correction of jury verdicts will be extremely rare. But such occasions do arise. That they may, and then will require appellate intervention, follows from the right of appeal which the legislature confers in respect of them166. And if recent example in this Court be required, Carson v John Fairfax & Sons Ltd167, a case in which a large verdict in respect of a gross defamation was struck down as excessive and a retrial ordered, provides it. A judge's view of what is an 160 Cairns v John Fairfax & Sons Limited [1983] 2 NSWLR 708 at 716 per Samuels JA. 161 Broome v Agar (1928) 138 LT 698 at 702 per Sankey LJ. 162 Mechanical and General Inventions Co and Lehwess v Austin and the Austin Motor Co [1935] AC 346 at 373-375 per Lord Wright. 163 Cox v English, Scottish, and Australian Bank [1905] AC 168 at 170 per Lord Davey. 164 Place v Searle [1932] 2 KB 497 at 515 per Scrutton LJ. 165 Hocking v Bell (1945) 71 CLR 430 at 501 per Dixon J. 166 See s 102 of the Supreme Court Act 1970 (NSW). 167 (1993) 178 CLR 44. Callinan appropriate award of damages is neither more nor less sacrosanct than a jury's view whether imputations have or have not been conveyed. Another relatively recent example of the overturning of a jury verdict in this country is Conrad v The Chermside Hospital Board168 in which the Full Court of the Supreme Court of Queensland (Lucas SPJ, Kelly and Connolly JJ) upheld an appeal against a finding of no negligence by a jury and ordered a retrial. The law as I understand it to be, and which I will apply, is that a finding of a jury may only be overturned if it is one that no reasonable jury could reach. And in deciding whether that was so, the respondent who was the appellant in the Court of Appeal, was not entitled to any particular advantages stemming from the enactment of s 102 of the Supreme Court Act 1970 (NSW), whether or not the rights of an appellant under that section were greater or less than those of an appellant in an ordinary appeal at common law. The principles with respect to jury trials are too well established for any different view to be taken. It is important to keep in mind what the jury here were not asked to decide in answering the first of the questions. They were not asked whether any of the imputations were actually defamatory of the respondent, and the amount of the damages that should be awarded if they, or any of them were. The relevant question in each instance was simply whether the imputation was conveyed. Some other preliminary observations should be made. It is true that an article has to be read as a whole. But that does not mean that matters that have been emphasized should be treated as if they have only the same impact or significance as matters which are treated differently. A headline, for example, expressed pithily and necessarily incompletely, but designed to catch the eye and give the reader a predisposition about what follows may well assume more importance than the latter. There are two such headlines here: "It's a Bad Business" and "Caroline's World and the Rivkin Link". Layout may create its own impression. Some black and white shading which was used for one of the stories does have some sinister overtones. The order in which matters are dealt with can be significant. The capacity of the first paragraph of an article, the "intro," to excite the reader's attention is a matter upon which editors place store. The language employed is also of relevance. Here for example, the articles speak of "new information," "details of a secret investigation," "Sydney has developed an obsession," "high profile," "long running ... saga," "black box," "money trail," "no negative aspersions were ever drawn," "bonfire of speculation," "celebrity stock broker," "executive assistant" (in quotation marks), "hangout for ex-drug dealers," "closest cronies," "a very serious crime," and "how easy it is to make a murder look like a suicide." The intrusion of irrelevant information may raise questions as to the meaning intended to be, and actually conveyed: for example: 168 [1982] Qd R 242. Callinan "Rivkin had 18 cars ranging from ...," and " ... share price jump ... after a fire on Christmas Eve ...". True it may be that readers may take an article or articles on impression, but the fact that they may do so is likely to have the consequence that ideas and meanings conveyed by graphic language will create the strongest impressions. Of course publishers are entitled to use colourful and seductive language, but in using it they may run the risk of seducing readers into believing only what is colourful and on occasions scandalous, rather than the facts conveyed by straight reportage. An even moderately attentive and reasonable, but not unduly suspicious reader of one or more of the articles here, would be bound to ask himself what each or all of them is or are really about: why is a financial newspaper dwelling and speculating on the "mysterious" death of a young model; what is the "bad" as opposed perhaps to the "sad" business of which the publisher is speaking; why was there so much secrecy; what did Mr Wood and the respondent wish or need to conceal; did the respondent have a motive to procure the death of Ms Byrne; and why are Mr Byrne's allegations given so much prominence? The repetition of one person's allegations by a newspaper, particularly if accompanied by other, balanced material may not always necessarily carry as an imputation the substance of the allegations, but the fact that an apparently responsible financial and broadsheet publisher has chosen to repeat them may well give them a meaning, credibility and impact that they might not otherwise possess. The matters that I have just discussed cannot be divorced from a consideration of the question that this Court has to decide, whether the Court of Appeal should have held that the conclusions of the jury on the six imputations which the Court of Appeal found conveyed were ones that no reasonable jury could reject. Counsel for the respondent sought to maintain in this Court the order of the Court of Appeal that there be a retrial on all the imputations although only six of them were held to have in fact been conveyed. He properly conceded, that although he would urge that such a total retrial was appropriate, he could not, in light of the course that the proceedings had taken, argue that the jury so unreasonably dealt with the nine other imputations not found, that one or more of these should in any event be the subject of a retrial. The result for which the respondent contended therefore was whether there should, as ordered by the Court of Appeal be a retrial on all of the imputations, or on the six found by the Court of Appeal and one other which requires separate treatment. That does not mean however that the jury's response to all of the alleged imputations is irrelevant. Indeed that response may well provide an indication of both the diligence and reasonableness, or otherwise, of the way in which the jury undertook their task. It is for this reason that I propose to give consideration to all of the imputations. Whether the relatively short duration of the jury's deliberations which Foster AJA in the Court of Appeal Callinan thought relevant provides a similar indication, is a matter which I will put aside for the present. Imputation 1(a) (Pleading 4(a)) The Court of Appeal was correct to hold that the jury's answer in respect of imputation 1(a) was one that no reasonable jury could give. Paragraph 15 of the relevant article has no other meaning than that the respondent's reputation as a stockbroker, whether as a canny and astute stockbroker, or a sagacious and astute one (and whether rightly so or not) was diminished. Indeed, the word used, "battering", probably conveys a much stronger imputation than of diminution. The fact that other parts of the article may go some way towards ameliorating the damage that the paragraph inflicts does not remove the sting contained in it. Paragraph 15 does not stand alone. Other parts of the article, for example: the reference to "slush fund" and the "long-running Offset Alpine saga" in paragraph 9; and the incurring of the large liability for tax, all combine to convey a clear impression of financial ineptitude or worse, in which the respondent as a stockbroker was involved. The imputation as pleaded did not allege that the diminution in reputation was a permanent one. Its duration and impact would be matters for the court when it came to assess damages. So too it was of no consequence that the article may also have said that Mr Croll was mistaken, or the respondent was "cleared of any wrong doing". It was upon the respondent's canniness and astuteness that paragraph 15 reflected, and not necessarily his probity although that too, taken with the rest of the article, was thrown into question. Imputation 1(b) (Pleading 4(b)) There is no doubt that the article described and treated the respondent as the controller of the Offset Alpine Press Group ("Offset"). Paragraph 13 speaks of the stripping of Offset in its various incarnations during the period of the respondent's association with it. There then follows (in paragraph 25) the statement that the respondent became a major focus of an inquiry by the ASC. These have to be read in the context of other statements in the article: in paragraph 9, the reference to "secret holdings in Rivkin's Offset Alpine Press Group", "the long-running Offset Alpine saga", and "where the ASC tried in vain to trace what appeared to function as a $40 million slush fund". (emphasis added) It is important to note the precise words of the imputation. It refers to June 1995. The ASC was undoubtedly making inquiries into Offset's affairs. An important function of the ASC was to unearth, investigate and set in train the punishment of unlawful conduct. And it was, as the article said, undertaking at least the first and second of those activities with the respondent as its focus. The ASC then was, as the ASIC now is, an important regulatory authority. Readers Callinan could not reasonably doubt that it would have as its focus in an inquiry persons in respect of whom it believed it had grounds to suspect of unlawful conduct. The imputation pleaded was not that the respondent had engaged in unlawful conduct. It was the ASC's reported suspicion of it at the relevant time that was the matter complained of. It was unreasonable for the jury to find that imputation 1(b) was not conveyed. The Court of Appeal was bound to hold accordingly. Imputations 1(c)(i) and 1(c)(ii) (Pleadings 4(c) and 4(d)) These imputations can be dealt with together. Earlier (in the table) I indicated the paragraphs upon which these imputations might be founded. The Court of Appeal held that the jury's rejection of them could not be said to be unreasonable. Their only relevance now is what their rejection says of the jury's deliberations, in view of the fact that they were plainly capable of being conveyed, and, in my opinion which cannot be substituted for that of the jury, were conveyed. The jury's answers certainly suggest that they undertook their task without a full appreciation of its importance and the need for a reasonable degree of diligence in performing it. The SMH of 25 February 1998 The next imputations are those arising out of the first of the articles in the SMH which bore the headline "Caroline's World and the Rivkin Link". The headline and the photographs of the persons whom the article discusses are shown, suggestively, in black and white shading. The language is colourful: "Even at six o'clock on a winter morning, Caroline Byrne would turn heads" (paragraph 1); "Caroline, [Byrne] wrote, was murdered by a contract killer because she knew too much ..." (paragraph 4); "The inquest ... threw more fuel on the bonfire of speculation" (paragraph 4). The name of the respondent is first introduced into the article in paragraph 21. Later, in paragraphs 34 and 38 it is directly stated (in quoting from a record of interview) that Mr Wood was alleged to have thrown Ms Byrne over the cliff where her body was found following surveillance which resulted in observation of the respondent and Mr Wood engaging in homosexual intercourse. The article then dwells upon the respondent, his employment of Mr Wood, their travel together, his relationship with Mr Wood as "a father as well as a boss", Ms Byrne's suspicion of the respondent, the respondent's "hang[ing] out with a whole stack of people ... [at] a hangout for ex-drug dealers ... Joe's Cafe" (paragraph 42) and that "Some of [the respondent's] closest cronies ... have ... criminal backgrounds or are rumoured to have it". (paragraph 43) Callinan Imputation 3(a) (Pleading 6(a)) Even taken with the headline, the passages I have referred to, together with the other matter contained in the article, do not go quite so far as to convey necessarily that the respondent was a person criminally liable in respect of the murder of the late Caroline Byrne. I would uphold the appeal in relation to this imputation. The jury was not unreasonable to reject it. The article is redolent of grave suspicions of murder but does not compel the reader to believe that murder had been committed by the respondent or by the respondent's agency. Imputations 3(b)(i) and 3(b)(ii) (Pleadings 6(b) and 6(c)) The Court of Appeal held that the jury was not perverse in relation to imputations 3(b)(i) and 3(b)(ii). I would myself have strongly disagreed with this conclusion, particularly with respect to the second of the imputations. The headline and the matters in particular to which I have referred in discussing imputation 3(a), and the article overall, in tone and implication, unmistakably I think convey both of these implications. The words of Lord Devlin in Lewis v Daily Telegraph Ltd169 are apposite in respect of them: "It is not, therefore, correct to say as a matter of law that a statement of suspicion imputes guilt. It can be said as a matter of practice that it very often does so, because although suspicion of guilt is something different from proof of guilt, it is the broad impression conveyed by the libel that has to be considered and not the meaning of each word under analysis. A man who wants to talk at large about smoke may have to pick his words very carefully if he wants to exclude the suggestion that there is also a fire; but it can be done. One always gets back to the fundamental question: what is the meaning that the words convey to the ordinary man: you cannot make a rule about that. They can convey a meaning of suspicion short of guilt; but loose talk about suspicion can very easily convey the impression that it is a suspicion that is well founded." However, because of the course of the proceedings, my opinion as to these imputations is of no significance, except again, to cast a very grave doubt upon the performance of the jury overall. Imputation 3(c)(i) (Pleading 6(d)) The Court of Appeal did not decide whether or not the jury erred in relation to this imputation. In my opinion the jury did err. The article states in terms that Ms Byrne had "caught [Mr Wood] and [the respondent] having 169 [1964] AC 234 at 285. Callinan homosexual intercourse". It is impossible to say that those words did not convey that the respondent had engaged in homosexual intercourse with Gordon Wood. There is nothing anywhere in the article to correct that assertion. The fact that it is a repetition of the words of someone else may perhaps lessen its impact but does not change its meaning. Although this imputation was rejected by the jury, and although the Court of Appeal did not decide whether the jury was correct, it was accepted by the parties that the issue of its conveyance or otherwise remained open in this Court. Accordingly, I intend to treat it as if it were the subject of a notice of contention. Imputation 3(c)(ii) (Pleading 6(e)) Equally, the asserted adoption by the police officer of the claim in paragraph 34 apparently earlier made by someone else, coupled with the blunt accusation, albeit again imputed to some other (anonymous) person, necessarily means that the police officer at least entertained the suspicion in question, to the point that he was prepared to put those assertions to Mr Wood. This imputation was inescapably conveyed. Imputation 3(d) (Pleading 6(f)) If a person says, as the appellant did in this article, that the respondent frequented a hangout for ex-drug dealers, and that some of his closest cronies have criminal backgrounds, that person is clearly saying that the person in question is a close associate of criminals. The word "crony" plainly implies both closeness and at least a suggestion of dishonourableness. The imputation was conveyed and any view to the contrary I would hold to be unreasonable. The SMH of 5 March 1998 Imputation 7(a) (Pleading 9(b)) Although the third article records Mr Wood's denial of his having been caught having sex with his boss (the respondent), the flamboyant stockbroker Mr Rene Rivkin, and his description of the allegations as "utter lies" (paragraph 4), the repetition of Detective Wyver's opinion that the evidence given at the inquest indicated that Mr Woods told lies, is certainly well capable of conveying an imputation that Mr Woods had engaged in sexual intercourse with the respondent. I would have held that it was in fact conveyed, but again my view can have only the limited relevance that a similar view that I hold in relation to some of the other rejected imputations has. Callinan Imputation 7(b) (Pleading 9(b)) For the same reasons as I have stated for my opinion about imputation 7(a), I would reach the same conclusion with respect to this imputation. Imputations 7(c)(i) and 7(c)(ii) (Pleadings 9(c) and 9(d)) Paragraph 4 of the third article says, almost in terms, despite Mr Wood's denial of it, that surveillance commissioned by the late Ms Byrne had lead to the revelation to her, of a matter which she then had reason to believe, of the engagement by the respondent with Mr Wood in homosexual relations. This I would have thought necessarily conveyed the pleaded imputations. The jury and the Court of Appeal were however of a different mind. The AFR of 21-22 February 1998 and the SMH of 25 February 1998 True innuendo I turn now to the true innuendo case. The substance of this case is that those who read both of the first two articles would have had a heightened suspicion and a greater awareness of the facts and circumstances as they were being stated and implied by the appellant. In reading and reflecting on, no matter how briefly, the two articles as a composite, a reader would be left with the impression that suicide by Ms Byrne was unlikely because her body was found some distance from the base of the cliff; that the references to the respondent, particularly to his association at Joe's Cafe with his cronies who had criminal backgrounds, and that Ms Byrne possessed embarrassing information about the respondent, that is, information relating to serious crime as referred to in the article in the AFR. All of this, it is submitted by the respondent, is necessarily to implicate him in the crime of murder. Imputation 5(a) (Pleading 7(a)) Having regard to my understanding of the two articles I might well have inferred the imputation alleged. I cannot say however that it would be beyond reason for an ordinary reader to take a different view falling short of the imputation alleged, that there was a possibility of the respondent's involvement, that there was reason to entertain a strong suspicion of the respondent's involvement but these are not the imputations pleaded here. I would disagree therefore with the holding of the Court of Appeal that the jury's negative answer on this imputation cannot be sustained. Callinan Imputations 5(b)(i) and 5(b)(ii) (Pleadings 7(b) and 7(c)) Again I think I would have reached a different conclusion on these two imputations, particularly the latter, from both the jury and the Court of Appeal. My view can only however have the limited relevance to which I have referred. The disposition of the appeal For the reasons that I have given it is plain that the jury both misunderstood the nature of their task and acted unreasonably. This was so, in my opinion, in respect of all of the imputations except those alleging criminal liability on the part of the respondent for the murder of Ms Byrne. The consistent and undiscriminating rejection of all of the imputations is astonishing. Perhaps the jury believed, or thought they knew something of the respondent. If the appellant was correct to describe him as it did, as a celebrity, perhaps his presence in the public eye may have told against him. Who knows? It is pointless to speculate. True it is that a jury's verdict is inscrutable, but inscrutability cannot be used as a mask for unreasonableness. The argument of the appellant in the Court of Appeal for the complete retrial ultimately ordered by the Court of Appeal, and the maintenance of that entitlement by the respondent in this Court, is based on the fact of the jury's unreasonableness throughout. The argument does have force. In the end however, I do not think that an appellate court should make such a far reaching order in respect of a jury's answers. The counsels against substitution of a judge's opinion for those of a jury, especially in the performance of the latter's duty under s 7A of the Act should be heeded. I am not prepared to accede to the respondent's submission that there should be a complete retrial. I remain of this view notwithstanding that the jury deliberated for only two hours before reaching their verdict. Whilst such a short retirement to answer so many questions inspires little confidence, it cannot, particularly in light of the fact that counsel had beforehand addressed them at some length, and that they were directed by the trial judge as to their duty, provide a basis for the complete rejection of the jury's answers. The only other matter (apart from costs) is the order of addresses. The traditional rules relating to ordinary common law trials are these170. If the defendant has called or tendered evidence, the defendant should address first. If the defendant has not called or tendered evidence, the plaintiff should address first. Replies, if any, should be strictly limited to the correction of misstatements of facts. Except for the last matter and a general discretion which has been left to 170 Phipson on Evidence, 10th ed (1963) at 65-66 [125]-[127]. Callinan the trial judge, these rules have substantially been adopted in New South Wales. Part 34 r 6 of the Supreme Court Rules provides as follows: "[34.6] Conduct of the trial The Court may give directions as to the order of evidence and addresses and generally as to the conduct of the trial. Subject to subrule (1): (a) where the only parties are one plaintiff and one defendant, and there is no cross-claim, the order of evidence and addresses shall be as provided by the following subrules of this rule; and in any other case, the order of evidence and addresses shall be as provided by the following subrules of this rule, subject to such modifications as the nature of the case may require. The beginning party may make an address opening his case and may then adduce his evidence. (4) Where, at the conclusion of the evidence for the beginning party, no document or thing has been admitted in evidence on tender by the opposite party, the opposite party may elect to adduce evidence or not to adduce evidence. If, pursuant to subrule (4), the opposite party elects not to adduce evidence, the beginning party may make an address closing his case and then the opposite party may make an address stating his case. If, pursuant to subrule (4), the opposite party elects to adduce evidence, the opposite party may make an opening address before adducing his evidence and after adducing his evidence he may make an address closing his case and thereupon the beginning party may make an address closing his case." The discretion exercised by the trial judge has not been shown to have been erroneously exercised. The trial judge made no error, particularly as there was nothing in the respondent's address to correct, in refusing the appellant a right of reply. The appellant succeeded in relation to imputations 3(a) (6(a) as pleaded) and 5(a) (7(a) as pleaded). The appeal should be upheld as to that extent. A Callinan retrial should however be ordered in respect of imputations 1(a) (4(a) as pleaded), 1(b) (4(b) as pleaded), 3(c)(i) (6(d) as pleaded), 3(c)(ii) (6(e) as pleaded) and 3(d) (6(f) as pleaded) for the reasons I have given. I would make orders accordingly. Because both parties have had their successes and their failures in this Court I would make no orders as to costs. 219 HEYDON J. I agree with the conclusions of Callinan J in relation to imputations 1(a), 1(b), 3(a), 3(c)(ii) and 3(d) for the reasons he gives. I also agree with his conclusions on imputation 3(c)(i) for the following reasons. Imputations 3(c)(i) and (ii) were left to the jury as alternatives. The Court of Appeal held that "at least the alternative pleaded as imputation 3(c)(ii) had been made out". However, the Court of Appeal did not decide one way or the other whether the jury had been unreasonable in not concluding that imputation 3(c)(i) was conveyed. Since imputation 3(c)(i) is more serious than imputation 3(c)(ii), there could be some practical importance in deciding the question which the Court of Appeal left undecided. I agree with Callinan J's reasons for concluding that the words of the article conveyed the imputation and that the jury behaved unreasonably in not so finding. The written submissions of the respondent did not seek a ruling from this Court on the reasonableness of the jury's finding on imputation 3(c)(i). Since the Court of Appeal's orders gave the respondent a new trial on that imputation, together with all the other imputations, it would have been inappropriate for the respondent to have filed a Notice of Cross Appeal: there was no order which the respondent was seeking to disturb. However, had the respondent intended to raise the point from the outset, a Notice of Contention was necessary. Despite the absence of any relevant Notice of Contention, it became common ground in argument in this Court that this Court was at liberty to reach a conclusion about imputation 3(c)(i). The parties reached that common ground in the following way. Counsel for the respondent argued in this Court that since the Court of Appeal had not upheld the jury conclusion on imputation 3(c)(i), but merely left its reasonableness undecided, it was open for the respondent to seek a new trial on that imputation even if the wider argument that he should have a new trial on all the imputations on which the Court of Appeal had agreed with the jury failed. In the address in reply of counsel for the appellant, it was contended that imputations 3(c)(i) and (ii) were "[m]utually exclusive alternatives". That is correct in one sense but not another. The document containing "Questions for the Jury" contained the following note after question 3(c)(ii): "Answer (c)(ii) only if you have answered (c)(i) 'No'. Do not answer (c)(ii) if you have answered (c)(i) 'Yes'." Hence an affirmative answer to question 3(c)(i) was exclusive of any answer to question 3(c)(ii). But the fact that the Court of Appeal thought question 3(c)(ii) could only have been answered "Yes" left open the issue whether question 3(c)(i) could only have been answered "Yes". A little later counsel for the appellant indicated opposition to a suggestion that this Court could examine the merits of the Court of Appeal's reasoning in relation to all of those imputations which they held the jury had rightly rejected. Counsel for the respondent then said he did not support the suggestion. Counsel for the appellant in turn responded by observing that that spared him saying anything about imputations 3(c)(i) and (ii) beyond a submission he made about imputation 3(c)(ii). Shortly thereafter counsel for the respondent indicated that his disclaimer of any invitation to examine the correctness of the Court of Appeal's agreement with the jury on the imputations it rejected did not apply to imputation 3(c)(i). Counsel for the appellant then said that the relevant paragraph of the Court of Appeal's reasons was "expressed in such a way that we would accept that my learned friend may raise that point". That consensus between the parties obviated the need for any notice of contention about imputation 3(c)(i). The complaint of the respondent about the trial judge's failure to grant leave to the respondent to have an address in reply should be rejected on the ground that, assuming there was power to permit an address in reply, nothing calling for the exercise of that power in a manner favourable to the respondent was pointed to. While it was reasonable for the parties and the trial judge to debate, at the start of the trial, whether the respondent could have an address in reply, the best time to judge when an address in reply is needed is immediately after the close of the address to which it will be a reply. Most "replies" are abuses of process, being only rehashes of what was said in the address-in-chief: a true reply is one which is needed to deal with fresh matter raised in the address to which the reply is directed, and thereby to reduce the risk of injustice. In particular, a reply is needed, if there is power to permit it, where the party seeking to reply would be materially prejudiced without it. A judgment by counsel who might deliver a reply or by the court on questions of injustice and prejudice depends on what the address being responded to contained. The respondent did not submit to the trial judge or to this Court that there was anything prejudicial in the appellant's address to the jury. The respondent did not point to anything which could or should have been said in any address in reply. Accordingly, the present occasion is not a suitable one on which to deal definitively with the existence of any right to an address in reply in cases under s 7A of the Defamation Act 1974 (NSW). I agree with Callinan J's conclusion that the retrial should be limited to imputations 1(a), 1(b), 3(c)(i) and (ii) and 3(d). I do so for one narrow reason. While there were features of the jury's performance about which the Court of Appeal was rightly troubled, in a case where the articles taken separately or together were not without complication, where the imputations were numerous and subtle and where there has been considerable diversity of judicial opinion as to what findings should have been made about whether particular imputations could or should have been conveyed, it cannot be inferred either from the universality of the jury's rejection of the imputations or the period of time for which the jury retired or any other circumstance of the case that the jury mistook or failed to perform its function to so great an extent that a retrial should be ordered on all the imputations. It does not follow from the fact that error has been specifically demonstrated in relation to some imputations that it should be inferred from others. The question whether the authorities which make it difficult for appellate courts to interfere with jury verdicts can stand with s 102 of the Supreme Court Act 1970 (NSW) should be left for another occasion. A full examination of the question would call for analysis of past authorities in the light of the language of the statutory enactments regulating appeals in force at other times in both New South Wales and other places. It is unnecessary to undertake that extensive inquiry in this case, because the outcome could not be different whatever the answer to the question. I favour the following orders: The appeal is allowed. There is to be a new trial on imputations 1(a), 1(b), 3(c)(i) and (ii), and
HIGH COURT OF AUSTRALIA THE QUEEN AND APPELLANT DENNIS BAUER (A PSEUDONYM) RESPONDENT The Queen v Dennis Bauer (a pseudonym) [2018] HCA 40 12 September 2018 ORDER Appeal allowed. The application for leave to cross-appeal be refused. Set aside orders 2, 3 and 4 made by the Court of Appeal of the Supreme Court of Victoria on 30 June 2017 and, in their place, order that the appeal to that Court be dismissed. On appeal from the Supreme Court of Victoria Representation B F Kissane QC with B L Sonnet for the appellant (instructed by Solicitor for Public Prosecutions (Vic)) C A Boston with P J Smallwood for the respondent (instructed by Doogue + George) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS The Queen v Dennis Bauer (a pseudonym) Evidence – Criminal trial – Sexual offences with child under 16 years – Tendency evidence – Admissibility – Severance – Where evidence of complainant as to 17 sexual acts and several uncharged sexual acts admitted as tendency evidence – Where evidence of third party as to Charge 2 admitted as tendency evidence – Whether evidence of complainant and third party admissible as tendency evidence – Whether evidence of each charged act and uncharged act cross-admissible as tendency evidence in proof of each charge – Whether tendency evidence had significant probative value – Whether possibility of risk of contamination, concoction or collusion relevant to determination of probative value – Whether probative value substantially outweighed any prejudicial effect – Whether tendency notice defective – Whether Charge 2 should have been severed from indictment. Evidence – Criminal trial – Recording of evidence – Admissibility – Where evidence of complainant recorded at previous trial admitted – Where prosecutor told court that complainant had strong preference not to give evidence at trial based on advice from counsellors – Where defence counsel did not challenge complainant's preference not to give evidence – Whether in interests of justice to admit recording. Evidence – Criminal trial – Hearsay – Admissibility – Where complainant made representations to third party that she was sexually assaulted by respondent – Where representations made in response to leading questions from third party – Where inconsistencies between complainant's representations and other evidence given by complainant – Whether occurrence of asserted facts fresh in complainant's memory at time of representations – Whether probative value of evidence outweighed by danger of unfair prejudice. Words and phrases – "charged act", "collusion", "complaint", "concoction", "contamination", "credibility", "cross-admissible", "discreditable acts", "fresh in the memory", "improper prejudice", "jury directions", "previously recorded evidence", "sexual attraction", "sexual interest", "sexual offence", "significant probative value", "single complainant", "special feature", "tendency", "uncharged act", "unfair prejudice", "willingness". "propensity", "severance", "reliability", "recording", Criminal Procedure Act 2009 (Vic), ss 194, 379, 380, 381, 385. Evidence Act 2008 (Vic), ss 66, 97, 99, 101, 135, 137. Jury Directions Act 2015 (Vic), ss 61, 62. Evidence Regulations 2009 (Vic), reg 7. KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ. Following the last of a number of retrials before the County Court of Victoria at Melbourne, the respondent was found guilty and convicted of 18 charges of sexual offences committed against the complainant ("RC") over a period of approximately 11 years between 1988 and 1998. He was sentenced therefor to nine years and seven months' imprisonment with a non-parole period of seven years. He appealed against conviction to the Court of Appeal of the Supreme Court of Victoria (Priest, Kyrou and Kaye JJA) on four grounds of appeal, all of which were upheld1. The Court of Appeal held2 that the trial judge had erred in admitting a recording of RC's evidence at a previous trial pursuant to s 381 of the Criminal Procedure Act 2009 (Vic); erred in admitting evidence of the charged acts and evidence of a number of uncharged acts, pursuant to s 97 of the Evidence Act 2008 (Vic), as tendency evidence; erred in failing to sever Charge 2 and order that it be tried alone; and erred in admitting evidence, pursuant to s 66 of the Evidence Act, of representations made by the complainant to a third party. Their Honours quashed the convictions and ordered that a new trial be had. By special leave granted by Gageler, Gordon and Edelman JJ, the Crown now appeals to this Court. For the reasons which follow, the appeal should be allowed. Relevant statutory provisions Criminal Procedure Act Section 194(2) of the Criminal Procedure Act creates a presumption that if two or more charges for sexual offences are joined in the same indictment those charges are to be tried together. Section 194(3) provides that that presumption is not rebutted merely because evidence of one charge is inadmissible on another charge. 1 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176. 2 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [42], [83], Bell Nettle Gordon Edelman Section 379 provides in substance and so far as is relevant that, subject to s 381, a recording of a complainant's evidence is admissible in evidence at trial, and at any new trial, as if its contents were the direct testimony of the complainant. Section 380 provides in substance that the prosecution must give notice to the accused and the court of any intention to tender such a recording. Section 381 provides that: "(1) The court may admit a recording of the evidence of the complainant if it is in the interests of justice to do so, having regard (a) whether the complainant's recorded evidence is complete, including cross-examination and re-examination; the effect of editing any inadmissible evidence from the recording; the availability or willingness of the complainant to give further evidence; (d) whether the accused would be unfairly disadvantaged by the admission of the recording; any other matter that the court considers relevant. (2) The court may admit the whole or any part of the contents of a recording and may direct that the recording be edited or altered to delete any part of it that is inadmissible." Section 385 provides so far as is relevant that: ... if a recording of the evidence of the complainant is admitted into evidence in a proceeding, the complainant cannot be cross- examined or re-examined without leave. (2) A court must not grant leave to cross-examine a complainant unless the court is satisfied that— Bell Nettle Gordon Edelman the accused is seeking leave because of becoming aware of a matter of which the accused could not reasonably have been aware at the time of the recording; or if the complainant were giving direct testimony in the proceeding, the complainant could be recalled, in the interests of justice, to give further evidence; or it is otherwise in the interests of justice to permit the complainant to be cross-examined or re-examined." Evidence Act At relevant times, s 66 of the Evidence Act relevantly provided that: "(1) This section applies in a criminal proceeding if a person who made a previous representation is available to give evidence about an asserted fact. If that person has been or is to be called to give evidence, the hearsay rule does not apply to evidence of the representation that is given by— that person; or a person who saw, heard or otherwise perceived the representation being made— if, when the representation was made, the occurrence of the asserted fact was fresh in the memory of the person who made the representation. (2A) In determining whether the occurrence of the asserted fact was fresh in the memory of a person, the court may take into account all matters that it considers are relevant to the question, including— the nature of the event concerned; and the age and health of the person; and Bell Nettle Gordon Edelman the period of time between the occurrence of the asserted fact and the making of the representation. Note Subsection (2A) was inserted as a response to the decision of the High Court of Australia in Graham v The Queen (1998) 195 CLR 606." Section 97 provides so far as is relevant that: "(1) Evidence of the character, reputation or conduct of a person, or a tendency that a person has or had, is not admissible to prove that a person has or had a tendency (whether because of the person's character or otherwise) to act in a particular way, or to have a particular state of mind unless— the party seeking to adduce the evidence gave reasonable notice in writing to each other party of the party's intention to adduce the evidence; and the court thinks that the evidence will, either by itself or having regard to other evidence adduced or to be adduced by the party seeking to adduce the evidence, have significant probative value." Pursuant to s 99, notices given under s 97 are to be given in accordance with any regulations or rules made for the purposes of the section. Relevantly, reg 7 of the Evidence Regulations 2009 (Vic) provides that a notice must state, so far as is relevant: "(1) For the purposes of section 99 of the Act, a notice given under section 97(1)(a) of the Act (relating to the tendency rule) must state— the substance of the evidence that the notifying party intends to adduce, and if that evidence consists of, or includes, evidence of the conduct of a person, particulars of— Bell Nettle Gordon Edelman the date, time and place at and the circumstances in which the conduct occurred; and the name of each person who saw, heard or otherwise perceived the conduct". Section 101 relevantly provides that: "(1) This section only applies in a criminal proceeding and so applies in addition to sections 97 and 98. (2) Tendency evidence about an accused ... that is adduced by the prosecution cannot be used against the accused unless the probative value of the evidence substantially outweighs any prejudicial effect it may have on the accused." Section 135 provides so far as is relevant that: "The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might— be unfairly prejudicial to a party; or be misleading or confusing; or cause or result in undue waste of time; or unnecessarily demean the deceased in a criminal proceeding for a homicide offence." Section 137 provides that: "In a criminal proceeding, the court must refuse to admit evidence adduced by the prosecutor if its probative value is outweighed by the danger of unfair prejudice to the accused." The Crown case at trial The Crown case at trial was that, in or about 1985 or 1986, the Department of Human Services placed RC, who was then a child of two years of age, and her younger half-sister ("TB") with the respondent and his then wife as Bell Nettle Gordon Edelman foster parents. RC and TB came to regard the respondent and his wife as parents and called them dad and mum. Thereafter: (1) Between 1 January 1988 and 15 January 1989, when RC was about five years of age and the respondent and RC were in the lounge room, respondent placed RC's hand on his penis (Charge 1: indecent assault). It was an aggravating circumstance of the offence that the respondent also played RC a pornographic video and penetrated RC's vagina with his finger. the (2) Between 1 January 1990 and 31 December 1992, when RC was about seven years of age and the respondent and TB were together in the bath, RC came into the bathroom and the respondent placed RC's hand on his penis (Charge 2: indecent assault). (3) Between 16 January 1990 and 31 December 1992, when RC was between seven and nine years of age and the family were travelling in the family van – the respondent's wife driving, TB seated in the next row and the respondent seated in the last row, next to RC – the respondent under cover of a blanket rubbed RC's vagina and placed her hand on his penis (Charges 3 and 4: indecent assault). (4) Between 16 January 1991 and 15 January 1993, when RC was about eight years of age, the respondent took her into his bedroom and licked her vagina (Charge 14: indecent assault) while her mouth his simultaneously (Charge 15: sexual penetration of a child under 10). It was an aggravating circumstance of those offences that the respondent also made RC suck his scrotum. inserting penis into (5) Between 1 January 1991 and 31 December 1992, when RC was eight to nine years of age and sleeping in TB's bed alone, the respondent touched RC's vagina (Charge 5: indecent assault) and attempted to insert his penis into her vagina (Charge 6: attempted sexual penetration of a child under 10). Between 1 January 1991 and 31 December 1992, when RC was around eight years of age and in the respondent's bedroom, the respondent showed RC pornographic photographs and then put her hand on his penis and made her masturbate him until he ejaculated Bell Nettle Gordon Edelman on her stomach (Charge 7: indecent assault). It was an aggravating circumstance of the offence that the respondent also touched the inside and outside of RC's vagina. Between 16 January 1992 and 15 January 1993, when RC was nine years of age – the respondent's mother being present but elsewhere in the house – the respondent rubbed RC's vagina as she lay ill in her bed in her bedroom (Charge 8: indecent act with a child under Between 16 January 1992 and 15 January 1994, when RC was nine or ten years of age, the respondent rubbed RC's vagina as he drove home on his tractor with RC (Charge 9: indecent act with a child under 16). Between 16 January 1992 and 15 January 1994, when RC was between nine and 11 years of age, the respondent committed four acts of sexual penetration of RC on a single occasion while the respondent and RC were in the respondent's work truck at a property away from home: (1) he inserted his finger into RC's vagina (Charge 10: sexual penetration of a child under 16); (2) he sexual inserted his tongue into RC's vagina (Charge 11: penetration of a child under 16); (3) he inserted his finger into RC's vagina a second time (Charge 12: sexual penetration of a child under 16); and (4) he inserted his penis into RC's mouth until he ejaculated, making RC swallow the ejaculate (Charge 13: sexual penetration of a child under 16). (10) Between 16 January 1994 and 15 January 1995, when RC was 11 years of age, the respondent, while the respondent and RC were in his work van at his work premises, rubbed his penis against RC's vagina until he ejaculated on her stomach (Charge 16: indecent act with a child under 16). (11) When RC was 12 years of age, the respondent's then wife told the Department of Human Services that she could no longer deal with what she described as RC's behavioural problems, and RC was removed from the respondent's care. When RC was 13 years old, she returned to the respondent's home on one occasion to visit TB (who had remained in the respondent's care). On that occasion, Bell Nettle Gordon Edelman which was between 16 January 1996 and 15 January 1997, the respondent put his finger into RC's vagina as she lay in bed in the spare room (Charge 17: sexual penetration of a child under the respondent's care, supervision or authority). The respondent also put RC's hand on his penis although that was not charged as an offence. (12) Between 15 December 1998 and 17 December 1998, when RC was 15 years of age, she again visited the respondent's home to see TB, and, on that occasion, the respondent touched RC's vagina over her clothing (Charge 18: indecent act with a child under 16). RC gave evidence that the respondent grabbed her, told her that he wanted to kiss her like a boyfriend, pulled his pants down to show her his erect penis, and said to her: "This is what you do to me". It is to be noted that Charge 2 was different from the other charges in that TB was the only prosecution witness to the offence. In the case of each of the other charges, RC was the only prosecution witness. The defence case at trial When first interviewed by the police in 2000, the respondent denied RC's allegations. By the time of the last trial, the record of interview had been lost or destroyed. When interviewed again in 2011, the respondent declined to comment. The defence case at trial was that the alleged conduct did not occur. The respondent did not give or call evidence but put the Crown to proof. The trial judge's rulings (i) Previously recorded evidence Prior to trial, the Crown gave notice to the respondent and the court under s 380 of the Criminal Procedure Act that it intended to apply to tender a recording of RC's evidence from the most recent previous trial, and, in the course of pre-trial argument, it made an oral application to do so. Specifically, the prosecutor stated from the Bar table that, based on the advice of counsellors and others, RC had a strong preference not to give evidence at trial if at all possible. Over objection, the trial judge (Judge Sexton) allowed the application on the basis that the admission of the recording was in the interests of justice and would Bell Nettle Gordon Edelman not unfairly disadvantage the respondent. Defence counsel did not make a separate application under s 385 for leave further to cross-examine RC. (ii) Tendency evidence Prior to trial, the Crown also gave notice, in accordance with s 99 of the Evidence Act, of its intention to adduce the following evidence, pursuant to s 97 of the Evidence Act, as tendency evidence, in order to establish that the respondent had a sexual interest in RC and a willingness to act upon it: evidence of RC of the acts comprising Charges 1 and 3 to 18; evidence of TB of the act comprising Charge 2; evidence of RC of the following uncharged acts: on a number of occasions between 15 December 1998 and 17 December 1998, when RC returned to the respondent's home, the respondent brushed up against her and grabbed her breasts and vagina on the outside of her clothing; on one occasion between December 1994 and January 1995, when RC was nearly 12 years of age, the family drove to Port Macquarie and stayed with one of the respondent's relatives, and one night in RC's bedroom the respondent rubbed RC's vagina and inserted his finger into her vagina; on a few occasions when RC was around nine years of age, the respondent made her suck his penis while he wore a condom; on numerous occasions when RC was living in the respondent's home, the respondent played pornographic videos to RC and got her to copy what was happening in the videos. That included putting his penis into her mouth, penetrating her vagina with his finger and licking her vagina; on various, frequent occasions while RC was living in the respondent's home, when she was the bathroom undressed, either in the bath or having a shower, the Bell Nettle Gordon Edelman respondent used to look at her through a hole in the door and poke his tongue through the hole; on various, frequent occasions abuse occurred when RC was alone; and evidence of TB of an uncharged act said to have occurred between 1992 and 1993, at the respondent's home, when TB got up in the middle of the night to go to the bathroom and took a few steps into RC's room intending to pass through it to the bathroom and saw the respondent in RC's bed on top of RC moving up and down3. When she asked: "What are youse doing?", the respondent yelled at her: "Get into fucken bed". In addition, the Crown relied on evidence of TB that, on an occasion when the family was in Port Macquarie, TB was in bed in her foster parents' bedroom when she heard mumbling voices or noises in the next room which she identified as RC's voice and another, deeper voice. The Crown did not rely on that evidence as tendency evidence but as generally supporting RC's account of the uncharged act described in (3)(b) above. Over objection, the trial judge ruled that the evidence listed in the s 97 notice was admissible as tendency evidence. After hearing detailed argument, her Honour delivered a considered ruling which included extensive analysis of the decisions of the Court of Appeal of the Supreme Court of Victoria in JLS v The Queen4, MR v The Queen5, PCR v The Queen6, Velkoski v The Queen7 and Gentry v Director of Public Prosecutions (Vic)8, and of the decision of this Court 3 The evidence was that TB saw the respondent on top of RC moving "backwards and forwards". [2011] VSCA 39. (2013) 235 A Crim R 302. (2014) 244 A Crim R 106. Bell Nettle Gordon Edelman in HML v The Queen9. In accordance with the process of tendency reasoning explicated in those decisions, her Honour held that, because all of the acts of which it was proposed to give evidence as tendency evidence were committed against the one complainant, it was unnecessary that those acts be of a similar kind: "[T]he primary similarity in this case is that each act of sexual contact involves the same complainant, thereby demonstrating a particular ongoing sexual interest in the complainant. In such circumstances the relationship is the operative factor. In summary, insofar as a single complainant trial is concerned, the principles for the reception of evidence as tendency evidence outlined in JLS have been confirmed in Velkoski, MR, PCR, and Gentry. These include that the relationship between the accused and the complainant is important; it is not necessary for the acts relied on to be identical or have highly similar features for the evidence to be admissible as tendency [evidence] or be close in time to each other; and if the proposed evidence meets the test for tendency evidence, it is preferable that the charged acts are not excluded." (footnotes omitted) The trial judge further observed, however, that if she were wrong in that conclusion, there were in fact features of commonality, or, as her Honour put it, "considerable overlap", comprised of the following: "There are 18 charged acts, but on four occasions, there are a number of charges occurring during the same event (Charges 3 and 4, Charges 5 and 6, Charges 10 through to 13 and Charges 14 and 15) while on four occasions, there are uncharged acts alleged to have taken place during the same event as charged acts ... As a result of this analysis it can be seen that there are multiple allegations of masturbation of the accused by RC, and by the accused in her presence; of the accused rubbing RC's vagina under and over her clothing; of digital penetration by the accused of RC's vagina; of rubbing (2008) 235 CLR 334; [2008] HCA 16. Bell Nettle Gordon Edelman his penis on the outside of RC's vagina including one attempted penile penetration; of penetration by his penis on RC's mouth; of licking her vagina; of touching her breasts; of kissing RC using his tongue; and of ejaculation in her presence. The only act which 'stands alone' is that of licking her breast, an uncharged act particularised to have occurred along with other sexual conduct during the act alleged as Charge 17. In my view, [the] dissimilarities do not diminish the probative value of [the] proposed tendency evidence, because each piece involves the same complainant, and each involve[s] the accused having access to the complainant through his position as her foster father. I find that the totality of the tendency evidence proposed to be led from RC is capable of demonstrating an ongoing sexual interest in her, and as such could, if accepted, enhance the probability of the charged acts having occurred. Further, the range of sexual acts and the time over which they are alleged to have been committed is capable of demonstrating a pattern of conduct engaged in by the accused in fulfilling his ongoing sexual interest." Having so concluded, the trial judge turned to whether the probative value of the tendency evidence to be led from RC substantially outweighed its prejudicial effect. Her Honour held that it did: "Any prejudice is due to the inculpatory nature of the tendency evidence and is not unfair prejudice. The proposed tendency evidence goes to proof of the fact in issue in each charge and will not distract the jury from its task, and clear directions ... will ensure that there is no substitution of the tendency evidence for the charged acts and no impermissible reasoning towards guilt." (footnote omitted) In a separate, further ruling, the trial judge held that, for similar reasons and because she was satisfied that there was no real possibility of contamination or collusion, the evidence of TB of Charge 2 and of the uncharged act of which it was proposed that TB give evidence would also be of significant probative value sufficient substantially to outweigh any prejudicial effect that it might have. As her Honour put it: "the evidence to be given by TB provides independent evidence of the accused's tendency; independent in the sense that it is from a source other Bell Nettle Gordon Edelman than the complainant. If the evidence from the same source – the complainant – can have a 'powerful probative effect', then evidence from another person of observations tending to show the same tendency must be of equal, if not greater probative effect. ... TB's evidence is direct evidence of the allegation comprising Charge 2, and provides general support for RC's account on other charges through the probability reasoning process. It is not necessary for its admissibility that RC also give evidence of the particular occasion. ... Further, the significant probative value of the evidence of TB seeing the accused in bed on top of RC is not reduced because it is not known exactly what the accused is alleged to have been doing. As I have said, the proposed tendency evidence is to be considered in light of other evidence to be adduced. In combination with the other alleged sexual misconduct, if accepted, the observation by TB of the accused in such circumstances is clearly capable of founding an inference that he was acting upon his sexual interest for RC. TB's evidence overall has the potential to provide corroboration in the nature of independent evidence of the accused's specific tendency to have a sexual interest in RC." (footnotes omitted) Thereafter, in a third ruling10, published shortly after publication of this Court's decision in IMM v The Queen11 and after hearing argument on the effect of IMM, the trial judge dealt specifically with the plurality's remark in IMM that12: "without more, it is difficult to see how a complainant's evidence of conduct of a sexual kind from an occasion other than the charged acts can be regarded as having the requisite degree of probative value." 10 Director of Public Prosecutions v Dennis Bauer (a pseudonym) No 2 ruling No 4 [2016] VCC 1517. 11 (2016) 257 CLR 300; [2016] HCA 14. 12 IMM v The Queen (2016) 257 CLR 300 at 318 [62] per French CJ, Kiefel, Bell and Bell Nettle Gordon Edelman As her Honour observed13, relevantly IMM concerned evidence of only one uncharged act sought to be adduced in addition to evidence of a number of charged acts, where the evidence of the one uncharged act and the evidence of the charged acts was given by the complainant alone. By contrast, as her Honour stated in relation to the proposed tendency evidence of RC14: "[I]n the case before me: the evidence of other conduct of a sexual kind came from a source other than the complainant for charge 2 and so is not uncharged, and the evidence of TB as to an uncharged act in [the respondent's home] is also from a source other than the complainant. Having regard to the fact that the evidence adduced to show the accused's sexual interest came from a witness other than the complainant, and to the fact that further supporting non-tendency evidence was derived from a source other than the complainant, I think that the tendency evidence where the complainant was the source did have a significant capacity to rationally affect the probability that her account of the charged acts, other than charge 2, was true." (footnotes omitted) In relation to the proposed tendency evidence of TB, her Honour stated15: "I remain satisfied that there was a high degree of probative value in TB's evidence, as it had a significant capacity to support the credibility of RC's account that the accused sexually abused her on the occasions the subject of the charges. Indeed, one of the acts is itself the subject of a charge (charge 2). While it was direct evidence for that charge, that did not prevent its use as tendency evidence for the charges for which RC gave evidence. Together with the other act relied on as tendency, TB's 13 Director of Public Prosecutions v Dennis Bauer (a pseudonym) No 2 ruling No 4 [2016] VCC 1517 at [18]. 14 Director of Public Prosecutions v Dennis Bauer (a pseudonym) No 2 ruling No 4 [2016] VCC 1517 at [35], [37]. 15 Director of Public Prosecutions v Dennis Bauer (a pseudonym) No 2 ruling No 4 [2016] VCC 1517 at [26]. Bell Nettle Gordon Edelman proposed evidence reached the required degree of probative value, as I found TB's evidence had the capacity to show that the accused had a sexual interest in RC, thereby having the capacity to support RC's credibility when she made those allegations in her evidence. A jury could rationally conclude that RC's account of charged acts of sexual misconduct was truthful, because TB gave an account that showed that on other occasions, the accused exhibited sexual interest in RC and was willing to act on it." Accordingly, the trial judge affirmed16 her earlier rulings that the tendency evidence of RC and TB was admissible, and thereafter the tendency evidence was received at trial in accordance with those rulings. (iii) Severance Prior to trial, as part of the respondent's objection to the admissibility of the tendency evidence, the respondent contended that Charge 2 should be severed from the indictment and tried alone. The trial judge rejected the argument on the basis that, because she was satisfied that TB's evidence taken in conjunction with the other evidence of charged and uncharged acts was of high probative value and not productive of improper prejudice, the presumption as to joinder in s 194(2) of the Criminal Procedure Act was not rebutted. (iv) Complaint evidence Finally, prior to trial, the Crown stated that it intended to call evidence, pursuant to s 66 of the Evidence Act, that, during the holiday period between December 1997 and January 1998 when RC was in Year 8 at school, RC moved into the home of a school friend ("AF") and thereafter lived with AF and her family until RC completed Year 12. Shortly after moving in, RC had a conversation with AF in which AF was required to guess what had allegedly occurred between the respondent and RC, which ultimately led to RC disclosing to AF that she had been sexually assaulted by the respondent. The respondent objected on grounds which included that the matters to which RC referred in her conversation with AF would not have been fresh in 16 Director of Public Prosecutions v Dennis Bauer (a pseudonym) No 2 ruling No 4 [2016] VCC 1517 at [26]-[28], [38]-[40]. Bell Nettle Gordon Edelman RC's memory at the time of the conversation and, therefore, that AF's evidence did not satisfy the requirements of s 66(2)(b) of the Evidence Act. It was further contended that the evidence was so "vague" that its probative value was significantly outweighed by the prejudice it would cause the respondent. The trial judge did not deliver a detailed ruling but nevertheless rejected those contentions and AF's evidence was received. The Court of Appeal's reasoning The basis of the respondent's appeal to the Court of Appeal was that the trial judge erred in each of her rulings. (i) Previously recorded evidence The Court of Appeal accepted17 that the recording of RC's evidence was complete and included a cross-examination which had been conducted with "conspicuous competence". The Court of Appeal appear also to have accepted that the respondent was not otherwise unfairly prejudiced by the admission of the recording. But the Court of Appeal held18 that it had not been shown that RC was "unwilling" to give evidence within the meaning of s 381(1)(c) of the Criminal Procedure Act, and, therefore, that a condition of admissibility had not been established. In their Honours' view, the statement that RC preferred not to give evidence did not mean that she was unwilling to do so, and, in any event, the trial judge had erred by proceeding on the basis of the prosecutor's statement as to RC's attitude towards giving evidence rather than insisting on evidence of RC's disposition: "Self-evidently, a to give evidence is not 'preference' not unwillingness to do so. As a matter of ordinary language – and in context – 'willingness' is preparedness to do something – that is, give further evidence – and a complainant is unwilling if he or she is not so prepared. By way of contrast, a person has a 'preference' if he or she considers one course to be more agreeable than another. It is unsatisfactory that the prosecutor simply asserted from the Bar table that the complainant had a preference not to give evidence. Evidence in 17 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [38]-[39]. 18 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [41]-[42]. Bell Nettle Gordon Edelman proper form that there was an absence of 'willingness' on the part of the complainant was required (assuming, of course, no concession was forthcoming from the [respondent])." Their Honours found it unnecessary to reach a final view as to whether a substantial miscarriage of justice had occurred solely as a result of the trial judge's error in admitting the recording19. (ii) Tendency evidence The Court of Appeal appear to have accepted20 that the trial judge's approach to tendency evidence accorded with the Court of Appeal's reasoning in JLS, and thus MR, PCR, Velkoski and Gentry, and so also with this Court's reasoning in HML. But the Court of Appeal held21 that the proper approach to the admissibility of tendency evidence had since been significantly qualified by the plurality's remark in IMM as to the limited probative value of a complainant's evidence of an uncharged act in proof of charged acts and by the majority's reasoning in Hughes v The Queen22 regarding particular features of the offending in that case. The Court of Appeal thus proceeded on the basis that a complainant's evidence of uncharged sexual acts is no longer to be regarded as having significant probative value in proof of charged sexual acts unless there are special features of the complainant's account. In the view of the Court of Appeal, RC's evidence was devoid of any such special features, and so was inadmissible23. 19 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [42]. 20 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [65]-[66]. 21 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [55], [69], 22 (2017) 92 ALJR 52; 344 ALR 187; [2017] HCA 20. 23 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [81]. Bell Nettle Gordon Edelman For the same reason, the Court of Appeal held24 that TB's evidence was inadmissible: "The alleged offending in this case occurred over the course of a decade. RC was aged four or five years at the start of that period and 15 at the end of it. TB's evidence was that on an occasion in 1990, when RC was aged about six or seven years, the [respondent] placed RC's hand on his penis. TB also gave evidence that in 1992 or 1993 she got out of bed to go to the toilet, and, when she stepped into RC's room, she saw the [respondent] in RC's bed under the blankets on top of RC moving up and down. RC gave no evidence of either of these alleged events. In our view, whether considered by itself, or in combination with the evidence of RC, TB's evidence did not possess significant probative value. The single event in 1990 when the [respondent] was said to have placed RC's hand on his penis was too isolated to establish the relevant tendency, even when considered with the other evidence; and the evidence of what TB allegedly saw in RC's bedroom in 1992 or 1993 was too vague to establish the tendency alleged, either alone or in combination. Certainly there is no unusual feature (as there was in Hughes) which would take TB's evidence beyond that of mere propensity or disposition." On those bases, the Court of Appeal concluded25 that a substantial miscarriage of justice had been occasioned by the admission of RC's and TB's evidence as tendency evidence. (iii) Severance The Court of Appeal further held26 that, because TB's evidence of Charge 2 was not cross-admissible in relation to the other charges, it had been productive of unfairness to the respondent to try Charge 2 with the other charges, and, therefore, that Charge 2 should have been severed and tried alone. 24 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [82]. 25 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [83]. 26 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [96], [99]- Bell Nettle Gordon Edelman (iv) Complaint evidence Lastly, the Court of Appeal held27 that AF's evidence of RC's representations was not admissible under s 66 of the Evidence Act, because: "there was no evidence in this case that the occurrence of any relevant asserted fact was 'fresh in the memory' of RC at the time that she made the previous representations upon which the prosecution sought to rely. Any representation that she made was generic and non-specific as to activity, surrounding circumstances, date or time, and was made in response to suggestions made to her in the course of AF's questioning." (footnote omitted) Alternatively, their Honours stated28 that, if the evidence of RC's representations to AF was admissible as complaint evidence under s 66, the probative value of the evidence was so slight as not to outweigh the risk of unfair prejudice, and, therefore, that it should have been excluded under s 137: "[G]iven the manner in which the representations were elicited as part of a 'guessing game', any probative value that the evidence possessed would be slight, and would not outweigh the risk of unfair prejudice. The risk of unfair prejudice flows from the possible misuse of the evidence. In particular, the jury might have used the evidence as supporting the credibility of RC in circumstances where, given the manner in which the representations were drawn out of RC by AF's questioning, the evidence could not properly have been used for that purpose. Section 137 of the Evidence Act 2008 ought to have dictated the exclusion of the evidence." The Court of Appeal held that a substantial miscarriage of justice had been occasioned by the admission of AF's evidence of RC's representations29. 27 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [112]. 28 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [113]. 29 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [114]. Bell Nettle Gordon Edelman Grounds of appeal The Crown's appeal to this Court was put on four grounds, in substance as follows: (1) The Court of Appeal erred in holding that the trial judge was wrong to admit the recording of RC's evidence. (2) The Court of Appeal erred in holding that a substantial miscarriage of justice was occasioned by the admission of RC's and TB's evidence as tendency evidence. (3) The Court of Appeal erred in holding that the trial judge was wrong to refuse to sever Charge 2. (4) The Court of Appeal erred in holding that a substantial miscarriage of justice was occasioned by the admission of AF's evidence of RC's representations. Ground 1: willingness to give evidence The Court of Appeal's approach to the question of RC's willingness to give evidence for the purposes of s 381(1)(c) of the Criminal Procedure Act was incorrect. The notions of willingness and preference are not mutually exclusive and "unwillingness" is not restricted to unqualified refusal. In its natural and ordinary sense, "unwillingness" includes reluctance and loathness just as much as it does obduracy30. Hence: "Norfolk, for thee remains a heavier doom, which I with some unwillingness pronounce"31. An inquiry as to a person's "willingness" to act is not ordinarily conceived of as limited to whether the person refuses to act. It is naturally and ordinarily understood as seeking to ascertain to what degree the person is willing or unwilling to act – conceptually, where along the scale of willingness which extends from abject refusal to unbridled enthusiasm the person is disposed. There is no reason to suppose that "willingness" is used in any different sense in s 381(1)(c) of the Criminal Procedure Act. If Parliament had intended to confine the operation of the provision to complainants 30 See and compare R v Darmody (2010) 25 VR 209 at 214-215 [24]-[28]. 31 Shakespeare, Richard II, act 1, scene 3, lines 150-151. Bell Nettle Gordon Edelman who refuse to give evidence, s 381(1)(c) would surely have been drafted in terms of a complainant's refusal to give evidence. Parliament's choice of the protean conception of "willingness" signifies that the question is one of degree. if a complainant's recorded evidence Certainly, as the Court of Appeal observed32, s 381(1) makes clear that a court may not admit a recording unless, having regard to the five considerations identified in pars (a) to (e) of the sub-section, it appears to be in the interests of justice to do so. The provision calls for a trial judge to weigh the identified considerations to determine whether, on balance, it is in the interests of justice to admit the recording33. But such is the nature of that exercise that the degree of unwillingness requisite to render it in the interests of justice to admit the recording is bound to vary according to the other identified considerations. For example, if a complainant's recorded cross-examination is inadequate, or if there is some other risk of an accused being unfairly disadvantaged by admission of the recorded evidence, a trial judge should be loath to conclude that it is in the interests of justice to admit the recording, except, perhaps, where the complainant is not available to give evidence or refuses point blank to do so. By contrast, if the risk of disadvantage is less, a lesser degree of unwillingness will more likely suffice to tip the scales of the interests of justice in favour of admission. In such a case, it may be enough that the complainant is most reluctant to give evidence. And where, as here, a recording is complete and includes a cross-examination which is "conspicuously competent", there are no problems with editing, and there is no other reason to consider that the recording's admission will be unfairly disadvantageous to the accused, a still lesser degree of unwillingness on the part of the complainant to give evidence will suffice to tip the scales of the interests of justice in favour of admission. incomplete, or As has been seen, the prosecutor advised the court that, based on the advice of RC's counsellors and others, it was RC's strong preference to avoid giving evidence if at all possible. In those circumstances, no error is shown in 32 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [28]. 33 See generally Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 17 September 2009 at 3377; Victoria, Legislative Assembly, Criminal Procedure Amendment (Consequential and Transitional Provisions) Bill 2009, Explanatory Memorandum at 28-29. Bell Nettle Gordon Edelman the trial judge's conclusion that it was in the interests of justice that the recording be admitted. On the facts of this case, there were no interests of justice to be served by its exclusion. And the fact that very experienced defence counsel did not seek leave under s 385 to cross-examine RC any further on specific matters fortifies that conclusion. That leaves the point as to whether the trial judge should have insisted on evidence of RC's unwillingness to give evidence rather than acting on the prosecutor's statement of it. Granted, where there is an issue about a complainant's state of willingness to give evidence, a trial judge should not proceed in the absence of evidence sufficient to establish the facts. But there was no issue about that here. What occurred was as follows: "[PROSECUTOR]: … (c) the availability or willingness of the complainant to give further evidence. I've conferred with her. She prefers not to give evidence. HER HONOUR: But she's otherwise available. [PROSECUTOR]: She's otherwise available. She's had counselling. I can get some evidentiary material if I need to but if the court is prepared for the moment at least to take it from the prosecutor that I've conferred with her. Her strong preference, based on advice from counsellors and others is to avoid giving evidence if at all possible. That is her preference. HER HONOUR: So it's counselling undertaken since the first trial? [PROSECUTOR]: It's continuous counselling that's part of the process but certainly my impression was that it was counselling in recent times but would the court just defer acting on that until I confirm that. I'm pretty sure that's what the effect of her statement to me was but it might be we'll just check with her on that. I suggest it will be (d) that will be a major issue in this case and that is whether the accused will be unfairly disadvantaged by the admission of the recording." Thereafter, although defence counsel contended that there was no evidence of how RC would be affected by giving evidence, defence counsel did not challenge the fact that it was RC's strong preference, based on the advice of her counsellors and others, not to give evidence if at all possible. The argument as to the admission of the recording proceeded accordingly. Most of the debate Bell Nettle Gordon Edelman was directed to defence counsel's contention that the respondent would be at an unfair disadvantage if the recording were admitted because the scope of the retrial was so much different from the scope of the previous trial that the cross-examination appropriate to the retrial needed to be substantially different. The principal bases for that contention were that the previous trial involved multiple complainants who had met; a defence that their evidence was affected by contamination, concoction or collusion; and the Crown putting its tendency case on a different footing. But the trial judge and the Court of Appeal34 rejected the contention, and, although in argument before this Court it seemed at times as if the respondent's counsel were seeking to reagitate the point, there was no contention to that effect. The remainder of the debate at trial was directed to a subsidiary contention that it would be unfair to receive the recording because, after editing, the recording would be replete with non-responsive answers and inadmissible material. The trial judge ruled in favour of the admission of the recording, noting that there was very little cross-examination of RC in relation to other complainants and very little editing required for references to TB's other allegations in the evidence of RC. Her Honour, however, did leave it open to defence counsel to revisit the matter after the editing had been completed, but, in the event, no such further application was ever made. Counsel for the respondent contended before the Court of Appeal that, after editing, one was left with a "bland cross-examination" of RC which did not include matters of substance. But the Court of Appeal rejected35 that contention and there was no contention before this Court against its rejection. Given the way in which the matter was dealt with before the trial judge, it did not lie in the mouth of the respondent later to complain to the Court of Appeal that he had been unfairly disadvantaged by the absence of evidence of RC's state of mind, or by being deprived of the ability effectively to cross-examine RC. Ground 1 should be upheld. 34 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [37]-[38]. 35 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [39]. Bell Nettle Gordon Edelman Ground 2: tendency evidence (i) Tendency reasoning As is apparent from comparison of the trial judge's ruling with the Court of Appeal's reasons for judgment, previous decisions of this Court have left unclear when and if a complainant's evidence of uncharged sexual and other acts is admissible as tendency evidence in proof of charged sexual offences. That is due in part to differences of opinion between members of the Court in HML – and in subsequent tendency evidence decisions, most recently IMM – as to the rationale of admissibility of tendency evidence in single complainant sexual offences cases. It is unsatisfactory that trial judges and intermediate courts of appeal should be faced with that problem. It is also unsatisfactory that the issue should continue to be attended by as many complexities as have thus far been thought to surround it. The admissibility of tendency evidence in single complainant sexual offences cases should be as straightforward as possible consistent with the need to ensure that the accused receives a fair trial. With that objective, the Court has resolved to put aside differences of opinion and speak with one voice on the subject. Henceforth, it should be understood that a complainant's evidence of an accused's uncharged acts in relation to him or her (including acts which, although not themselves necessarily criminal offences, are probative of the existence of the accused having had a sexual interest in the complainant on which the accused has acted) may be admissible as tendency evidence in proof of sexual offences which the accused is alleged to have committed against that complainant whether or not the uncharged acts have about them some special feature of the kind mentioned in IMM or exhibit a special, particular or unusual feature of the kind described in As the trial judge in substance observed, it has long been the law that a complainant's evidence of charged and uncharged sexual acts may be of significant probative value in the proof of other charged sexual acts. Taken in combination with other evidence, it may establish the existence of a sexual attraction of the accused to the complainant and a willingness to act on it which 36 (2017) 92 ALJR 52 at 68-69 [57]-[58], [62]-[64] per Kiefel CJ, Bell, Keane and Edelman JJ; 344 ALR 187 at 203-204. Bell Nettle Gordon Edelman assists to eliminate doubts that might otherwise attend the complainant's evidence of the charged acts37. In HML, Kiefel J (as her Honour then was) explained38 its significance thus: "'[R]elationship evidence' refers to all the conduct of a sexual kind that has taken place between the accused and the complainant. It encompasses sexual conduct which is an offence, often referred to as 'uncharged acts', and misconduct which may not be an offence. ... Clearly, relationship evidence is relevant as showing the sexual interest of the accused in, or the 'guilty passion' for, the complainant. Its relevance in this regard has been acknowledged by judges of this Court and by judges of State courts. There can be little doubt about its probative force. It may reveal a tendency in the accused, sometimes described as a motive. Where the relationship evidence shows that the accused has carried out sexual acts upon the complainant, or undertaken acts preparatory to them, the tendency or propensity on the part of the accused may be taken as confirmed. It may be concluded that the accused is prepared to act upon the tendency to an extent that it may be inferred that the accused will continue to do so. The evidence may then render more probable the commission of the offences charged." (emphasis added; footnotes omitted) 37 R v Ball [1911] AC 47 at 70-71 per Lord Loreburn LC (Earl of Halsbury, Lords Ashbourne, Alverstone CJ, Atkinson, Gorell, Shaw of Dunfermline, Mersey and Robson agreeing at 71-72); R v Gellin (1913) 13 SR (NSW) 271 at 277-278 per Cullen CJ (Pring J and Sly J agreeing at 278-279); R v Etherington (1982) 32 SASR 230 at 235 per Walters J (Matheson J relevantly and Millhouse J agreeing at 241, 247); B v The Queen (1992) 175 CLR 599 at 601-602 per Mason CJ, 605, 608 per Brennan J, 610-611 per Deane J, 618 per Dawson and Gaudron JJ; [1992] HCA 68; KRM v The Queen (2001) 206 CLR 221 at 230 [24] per McHugh J, 264 [134] per Hayne J; [2001] HCA 11. 38 (2008) 235 CLR 334 at 494-495 [492]-[493], see also at 352-353 [6]-[7], 354 [11], 358-359 [25]-[27] per Gleeson CJ, 382-384 [103], [109]-[110] per Hayne J (Gummow J and Kirby J agreeing at 362 [41], 370 [59]), 425-426 [277]-[278] per Heydon J, 478-480 [425]-[433] per Crennan J, 500-502 [506], [510], [512] per Bell Nettle Gordon Edelman Since proof of an accused's commission of a sexual offence against a complainant on one occasion makes it more likely that the accused may have committed another, generally similar sexual offence against the complainant on another occasion, at least where the two are not too far separated in point of time, where an accused is charged with a number of counts of generally similar sexual offences against a single complainant the several counts may ordinarily be joined in a single indictment and so tried together39. In such cases, evidence of each charged act is admissible as circumstantial evidence in proof of each other charged act and, for the same reason, evidence of each uncharged act is admissible in proof of each charged act40. The juridical basis of cross-admissibility of evidence of charged acts and of the admissibility of evidence of uncharged acts in such cases rests on the "very high probative value" of that kind of evidence which results from ordinary human experience that, where a person is sexually attracted to another and has acted on that sexual attraction and the opportunity presents itself to do so again, he or she will seek to gratify his or her sexual attraction to that other person by engaging in sexual acts of various kinds with that person41. As Hayne J (with whom Gummow and Kirby JJ agreed) concluded42 in HML: "Generally speaking ... there usually will be no reasonable view of other sexual conduct which would constitute an offence by the accused against the complainant, even if it is an isolated incident and temporally remote, which would do other than support an inference that the accused is guilty of the offence being tried." And the fact of itself that evidence of uncharged acts is given by a complainant does not mean that it lacks significant probative value. Although there is a lack of independence in the sense that the evidence of uncharged acts depends on the complainant's account, once the evidence is admitted, and assuming it is 39 See Criminal Procedure Act 2009 (Vic), s 194. 40 HML v The Queen (2008) 235 CLR 334 at 397-398 [168], 401-402 [181] per 41 HML v The Queen (2008) 235 CLR 334 at 423 [272] per Heydon J. 42 HML v The Queen (2008) 235 CLR 334 at 384 [109]. Bell Nettle Gordon Edelman accepted, it adds a further element to the process of reasoning to guilt43 and so, therefore, may be seen as significantly probative of the accused's guilt of the charged offences. Of course, HML was concerned with the admissibility of evidence of uncharged sexual acts as tendency evidence under common law rules of admissibility; in particular, under the common law rule of admissibility propounded in Hoch v The Queen44 and confirmed in Pfennig v The Queen45 that evidence of an accused's commission of discreditable acts other than those the subject of a charge may be admitted as tendency evidence only where it supports the inference that the accused is guilty of the offence charged and permits of no other, innocent explanation. Under s 97 of the Evidence Act, the Hoch test of admissibility has been superseded by the less demanding criterion of significant probative value46. But HML remains relevant. Given that six members of the Court in HML held47 that a complainant's evidence of uncharged acts is usually of sufficient probative value to pass even the Hoch test of admissibility, HML stands in effect as a pronouncement of the "very high probative value" of such evidence for the purposes of s 97 of the Evidence Act. 43 HML v The Queen (2008) 235 CLR 334 at 427 [280] per Heydon J. See also at 402 [182]-[184] per Hayne J (Gummow J agreeing at 362 [41]). And necessarily implicit in reasons of Gleeson CJ, Kirby J and Kiefel J. 44 (1988) 165 CLR 292 at 294-295 per Mason CJ, Wilson and Gaudron JJ, 302-303 per Brennan and Dawson JJ; [1988] HCA 50. See also Sutton v The Queen (1984) 152 CLR 528 at 564-565 per Dawson J; [1984] HCA 5. 45 (1995) 182 CLR 461 at 481-482 per Mason CJ, Deane and Dawson JJ; [1995] HCA 7. See also Harriman v The Queen (1989) 167 CLR 590 at 602 per Dawson J; [1989] HCA 50. 46 IMM v The Queen (2016) 257 CLR 300 at 317 [59] per French CJ, Kiefel, Bell and 47 (2008) 235 CLR 334 at 359 [27] per Gleeson CJ, 386 [118], 399 [171]-[173], 414 [234] per Hayne J (Gummow J and Kirby J agreeing at 362 [41]-[42], 370 [59]), 430-432 [287], [289], 451-452 [336], 460-461 [364], 467 [387] per Heydon J, 501- 502 [510]-[511] per Kiefel J. Bell Nettle Gordon Edelman incapable of adding significantly In IMM, a majority of this Court held48 that a complainant's evidence of a sole uncharged sexual act did not have significant probative value. Their Honours reasoned that, because the principal issue in that case was the complainant's credibility, the complainant's evidence of the uncharged act was rationally the complainant was telling the truth about the charged acts. The issue arose in a context in which the uncharged act was alleged to have occurred sometime after the charged acts, and was relatively innocuous by comparison. But the plurality also observed49, more generally, that a complainant's evidence of an uncharged act can generally have only limited capacity rationally to affect the probability of the complainant's account of the charged acts being true, unless there are some special features of the complainant's account of the uncharged act. the probability that That observation accorded with the reasoning of Howie J in the Court of Criminal Appeal of Qualtieri v The Queen50 and with several subsequent decisions of the Court of Criminal Appeal51. It was, however, to some extent at odds with the process of reasoning that found favour with the majority in HML and was followed by the Court of Appeal of the Supreme Court of Victoria in JLS52, MR53, PCR54, the Supreme Court of New South Wales 48 (2016) 257 CLR 300 at 318 [61]-[64] per French CJ, Kiefel, Bell and Keane JJ, 328-329 [107]-[108] per 49 IMM v The Queen (2016) 257 CLR 300 at 318 [62] per French CJ, Kiefel, Bell and 50 (2006) 171 A Crim R 463 at 493-494 [116]-[118] (Latham J agreeing at 495 [124]). 51 See for example AW v The Queen [2009] NSWCCA 1 at [50] per Latham J (Bell JA and Fullerton J agreeing at [1], [58]). 52 (2010) 28 VR 328 at 334-337 [19]-[20], [22]-[23], [28] per Redlich JA (Mandie JA and Bongiorno JA agreeing at 340 [37], [38]). 53 [2011] VSCA 39 at [13]-[15] per Hansen JA (Buchanan JA and Harper JA agreeing at [16], [17]). 54 (2013) 235 A Crim R 302 at 307 [37]-[38] per Buchanan JA (Neave JA and Priest JA agreeing at 310 [56]-[59], [61]). Bell Nettle Gordon Edelman Velkoski55 and Gentry56. In the result, as appears from the Court of Appeal's reasons for judgment in this case57, the Court of Appeal took the plurality's observation in IMM as in effect vindicating Priest JA's earlier expressed58 disagreement with the authority of JLS, and so as supporting the conclusion that RC's evidence of uncharged acts lacked significant probative value because her account of them was devoid of special features. So to have reasoned is unsurprising. But, as the trial judge in this case observed59, strictly speaking the reasoning of the plurality in IMM was limited to the case there under consideration: one which involved an uncharged act relevantly remote in time and of a significantly different order of gravity from the charged offending. IMM may be distinguished from a case like the present, where what is in issue is a course of offending comprised of a succession of uncharged sexual acts, of generally a similar kind to the charged acts, interspersed between the charged acts throughout the alleged period of offending. Thus, despite the apparent generality of the dicta in IMM, henceforth it should not be regarded as implying any departure from the majority opinions expressed in HML or, therefore, as contrary to the reasoning in JLS, MR, PCR, Velkoski or Gentry as to the high probative value which is ordinarily to be attributed to a complainant's evidence of uncharged sexual acts. IMM should be understood as confined to the particular, relatively exceptional circumstances of that case. As was earlier noticed, the Court of Appeal further reasoned60 that the majority judgment in Hughes dictated that, in a single complainant sexual 55 (2014) 45 VR 680 at 701 [92]-[93], 718 [168], 737-738 [235]. 56 (2014) 244 A Crim R 106 at 112-113 [24]-[29] per Redlich JA (Tate JA and Priest JA agreeing at 118 [49], [50]). 57 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [63]-[64], 58 Murdoch (A Pseudonym) v The Queen (2013) 40 VR 451 at 471 [83]. 59 Director of Public Prosecutions v Dennis Bauer (a pseudonym) No 2 ruling No 4 [2016] VCC 1517 at [30]-[31], [35]. 60 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [62]-[63], Bell Nettle Gordon Edelman offences case, evidence of charged acts is not admissible as tendency evidence in proof of other charged acts, and that evidence of uncharged acts is not admissible in proof of charged acts, unless there is some "special feature" of the complainant's evidence. As appears from the Court of Appeal's reasons, their Honours did so because they equated the significance of the particular features of the offending identified in Hughes with the significance of the special features of a complainant's account of an uncharged act referred to in IMM. So to reason mistook the logic of when and why it is necessary that sexual offending have some "special feature" about it in order to render it significantly probative of other sexual offending. The conclusion of the majority in Hughes61 that particular features of the offending imbued the subject tendency evidence with significant probative value reflected the process of probability reasoning that applies to cases where an accused is charged with a number of sexual offences committed against a multiplicity of complainants. As has been explained, the reference in IMM to "special features" of a complainant's account of an uncharged act should be understood as limited to a process of reasoning which sometimes applies in cases where an accused is charged with multiple sexual offences against a single complainant and it is sought to adduce evidence from the complainant of a single relatively remote and innocuous uncharged act as support for his or her evidence of the charged acts. Those two processes of reasoning are essentially different. In a multiple complainant sexual offences case, where a question arises as to whether evidence that the accused has committed a sexual offence against one complainant is significantly probative of the accused having committed a sexual offence against another complainant, the logic of probability reasoning dictates that, for evidence of the offending against one complainant to be significantly probative of the offending against the other, there must ordinarily be some feature of or about the offending which links the two together. More specifically, absent such a feature of or about the offending, evidence that an accused has committed a sexual offence against the first complainant proves no more about the alleged offence against the second complainant than that the accused has committed a sexual offence against the first complainant. And the mere fact that an accused has committed an offence against one complainant is ordinarily not 61 (2017) 92 ALJR 52 at 68-69 [57]-[60] per Kiefel CJ, Bell, Keane and Edelman JJ; 344 ALR 187 at 203-204. Bell Nettle Gordon Edelman significantly probative of the accused having committed an offence against another complainant62. If, however, there is some common feature of or about the offending, it may demonstrate a tendency to act in a particular way proof of which increases the likelihood that the account of the offence under consideration is true. Hughes illustrates the point. The case involved multiple complainants each alleging that the accused had committed one or more sexual offences against her, where the offences that were alleged to have been committed against some groups of complainants were in significant respects different in kind and circumstance from the sexual offences alleged to have been committed against each other group of complainants63. It was not disputed that evidence of each sexual offence alleged to have been committed against a complainant was admissible as tendency evidence in proof of other sexual offences alleged to have been committed against that complainant, even though, in some cases, the nature of the offending differed significantly from one charge to another. The issue was how much if any of each complainant's evidence of the sexual offences and uncharged acts alleged to have been committed against her was admissible as tendency evidence in proof of the sexual offences alleged to have been committed against the other complainants. And the case was ultimately decided by majority64 on the basis that, taken as a whole, the evidence of each alleged sexual offence and uncharged act demonstrated a common feature that a man of mature years had a sexual interest in female children under 16 years of age and a tendency them opportunistically in circumstances which entailed a high risk of detection. In the view of the majority, such was the significance of that common feature that it by committing sexual offences against to act upon 62 See HML v The Queen (2008) 235 CLR 334 at 354 [11]-[12] per Gleeson CJ, 382- 383 [105] per Hayne J (Gummow J and Kirby J agreeing at 362 [41], 370 [59]); GBF v The Queen [2010] VSCA 135 at [26]; BBH v The Queen (2012) 245 CLR 499 at 525 [70]-[71] per Hayne J (Gummow J agreeing at 522 [61]); [2012] HCA 63 See Hughes v The Queen (2017) 92 ALJR 52 at 66-68 [44]-[54] per Kiefel CJ, Bell, Keane and Edelman JJ; 344 ALR 187 at 200-202. 64 Hughes v The Queen (2017) 92 ALJR 52 at 68-69 [57]-[60] per Kiefel CJ, Bell, Keane and Edelman JJ; 344 ALR 187 at 203-204. Bell Nettle Gordon Edelman evidence of each alleged sexual offence and uncharged act had significant probative value in proof of each other charged offence. By contrast, in a single complainant sexual offences case, where a question arises as to whether evidence that the accused has committed one sexual offence against the complainant is significantly probative of the accused having committed another sexual offence against that complainant, there is ordinarily no need of a particular feature of the offending to render evidence of one offence significantly probative of the other. As was established in HML and has since been applied in Victoria under s 97 of the Evidence Act in JLS, MR, PCR and Gentry, and was recognised, too, in Velkoski, evidence that an accused has committed one sexual offence against a complainant taken in conjunction with evidence of another sexual offence against the complainant suggests that the accused has a sexual interest in or sexual attraction to the complainant and a tendency to act upon it as occasion presents. And as has been seen, that is so because, where one person is sexually attracted to another and has sought to fulfil that attraction by committing a sexual act with him or her, it is the more likely that the person will continue to seek to fulfil the attraction by committing further sexual acts with the other person as the occasion presents. (ii) The probative value of RC's evidence The question of whether tendency evidence is of significant probative value is one to which there can only ever be one correct answer, albeit one about which reasonable minds may sometimes differ. Consequently, in an appeal against conviction to an intermediate court of appeal, or on a subsequent appeal to this Court, it is for the court itself to determine whether evidence is of significant probative value, as opposed to deciding whether it was open to the trial judge to conclude that it was65. 65 R v Zhang (2005) 158 A Crim R 504 at 514-515 [45] per Basten JA in diss; L v Tasmania (2006) 15 Tas R 381 at 402 [55] per Underwood CJ (Tennent J agreeing at 408 [86]); R v Ford (2009) 273 ALR 286 at 311-314 [93]-[107], 316 [124] per Campbell JA, cf at 320 [145]-[146] per Howie J (Rothman J agreeing at 322 [157]-[158]); Dibbs v The Queen (2012) 225 A Crim R 195 at 211-212 [78]- [80] per Harper JA (Weinberg JA and T Forrest AJA agreeing at 197 [1], 216 [105]); Odgers, Uniform Evidence Law, 13th ed (2018) at 802-805 [EA.101.450]. See and compare McCartney v The Queen (2012) 38 VR 1 at 7-12 [31]-[51]. Bell Nettle Gordon Edelman In this case, in contrast to Hughes, there was only one complainant, all of the charged and uncharged acts were alleged to have been committed against her, and none of them was far separated in point of time or far different in nature and Here, therefore, there was no need of any gravity from the others. "special feature" in order to render the evidence of one charge cross-admissible in proof of the other charges, or to render the evidence of uncharged acts admissible in proof of the charged acts. Here, as in HML, JLS, MR, PCR and Gentry, the "very high probative value" and thus admissibility of the evidence of each charged and uncharged act rested on the logic that, where a person is sexually attracted to another and has acted upon that attraction by engaging in sexual acts with him or her, the person is the more likely to seek to continue to give effect to the attraction by engaging in further sexual acts with the other person as the opportunity presents. The trial judge was correct to hold that RC's evidence met the s 97(1)(b) test of significant probative value on that basis. (iii) RC's evidence not excluded by s 101, s 135 or s 137 Although it was contended before this Court that RC's evidence should have been excluded under s 101 or ss 135 and 137, in oral argument that contention was in effect confined to a submission that there was such a significant possibility of contamination, concoction or collusion that the evidence should have been excluded as tendency evidence. As is explained later in these reasons, that submission must be rejected. The trial judge was correct to hold that RC's evidence was not productive of unfair prejudice. (iv) The probative value of TB's evidence Essentially similar considerations apply to TB's evidence of Charge 2 and the uncharged act to which she was witness. Contrary to the Court of Appeal's reasoning, Charge 2 was not remote in time or context from the remainder of the charged offences. It was an integral part of the alleged continuum of sexual offending that ran between 1988 and 1998. Consistently with HML, JLS, MR, PCR and Gentry, TB's evidence of Charge 2 was cross-admissible in relation to each other charge as circumstantial evidence of the respondent's sexual attraction to RC and his tendency to act upon it when the opportunity presented. For the same reason, TB's evidence of the uncharged act – the respondent in RC's bed on top of her moving up and down – was admissible as circumstantial evidence of the respondent's sexual attraction to RC and his tendency to act upon it when the opportunity presented. Bell Nettle Gordon Edelman Counsel for the respondent submitted that, given that TB was only four or five years old at the time of the events comprising Charge 2 and only a few years older at the time of the uncharged act, her evidence of those events was so inherently unreliable as rationally to be incapable of acceptance66. That submission cannot be accepted. Admittedly, an adult's memory of what occurred when he or she was only four or five years of age is, generally speaking, limited. Ordinary experience suggests that much of those aspects of our memories consists of little more than relatively vague impressions67. But it also accords with ordinary experience that an adult's recollection of an extraordinary or shocking event that occurred at that age may be much more vivid68. No doubt, a jury would hesitate before accepting evidence of that kind. People of ordinary intelligence and experience are in the habit of questioning the accuracy of childhood recollections. But the likelihood of an adult having a precise recollection of an extraordinary or shocking event that occurred at the age of about four or five years is by no means so improbable that it is bound to be rejected. And especially is that so where, as here, there is evidence of another, similar event which occurred a few years later. The two are mutually supportive. Additionally, here it would have been open to the jury to reason that TB's recollection of Charge 2 was not unlikely to have been refreshed and reinforced by the uncharged act that she later witnessed and which according to her evidence so much concerned her as to cause her to inquire of RC and her foster mother regarding their significance at the time. Counsel for the respondent submitted that there was such a significant possibility of contamination, concoction or collusion in relation to TB's evidence 66 See R v Shamouil (2006) 66 NSWLR 228 at 236-237 [56] per Spigelman CJ (Simpson J and Adams J agreeing at 240 [81], [82]); IMM v The Queen (2016) 257 CLR 300 at 317 [58] per French CJ, Kiefel, Bell and Keane JJ. 67 See generally Longman v The Queen (1989) 168 CLR 79 at 101 per Deane J, 107-108 per McHugh J; [1989] HCA 60. 68 See generally R v XY (2010) 79 NSWLR 629 at 648 [98] per Whealy J (Campbell JA and Simpson J agreeing at 630 [1], [2]); LMD v The Queen [2012] VSCA 164 at [24] per Harper JA (Bongiorno JA and Davies AJA agreeing at [39], [40]); Pate v The Queen (2015) 250 A Crim R 425 at 437 [62] per Weinberg JA (Dixon AJA agreeing at 456 [150]). Bell Nettle Gordon Edelman as to deprive it of the degree of significant probative value necessary to satisfy the requirements of s 97. Counsel called in aid recent decisions of the Court of Criminal Appeal of the Supreme Court of New South Wales in R v GM69 and of the Court Murdoch (A Pseudonym) v The Queen70 in support of that submission. the Supreme Court of Victoria of Appeal The submission should be rejected. In GM, the New South Wales Court of Criminal Appeal held71 that, despite the decision in IMM, the possibility of contamination, concoction or collusion is a relevant consideration in the determination of whether tendency evidence has significant probative value for the purposes of s 97, because the risk of contamination, concoction or collusion may give rise to a "competing inference" sufficient to render the evidence inherently implausible. More recently, in BM v The Queen72 the New South Wales Court of Criminal Appeal stated that until and unless this Court says otherwise, the possibility of contamination, concoction or collusion remains relevant to admissibility. What was said in GM and BM now requires qualification. In this context, reference to competing inferences is unhelpful, and likely to lead to error. Relevantly, the only sense in which competing inferences are of significance in the assessment of the probative value of evidence is in the determination of whether the evidence could rationally affect the assessment of the probability of the existence of a fact in issue73. As was established in IMM74, 69 [2016] NSWCCA 78. 71 [2016] NSWCCA 78 at [100], [111] per Hoeben CJ at CL (Hall J agreeing at [127]), [129]-[134] per Button J. 72 [2017] NSWCCA 253 at [60] per Bathurst CJ (McCallum J and Bellew J agreeing 73 Evidence Act 2008 (Vic), Dictionary, definition of "probative value". See also IMM v The Queen (2016) 257 CLR 300 at 313-314 [42]-[48] per French CJ, Kiefel, 74 (2016) 257 CLR 300 at 314-316 [49]-[54] per French CJ, Kiefel, Bell and Bell Nettle Gordon Edelman that is a determination to be undertaken taking the evidence at its highest. Accordingly, unless the risk of contamination, concoction or collusion is so great that it would not be open to the jury rationally to accept the evidence, the determination of probative value excludes consideration of credibility and reliability. Subject to that exception, the risk of contamination, concoction or collusion goes only to the credibility and reliability of evidence and, therefore, is an assessment which must be left to the jury. To the extent that GM or BM suggests otherwise, it should not be followed. In Murdoch, which predated IMM, the Victorian Court of Appeal stated75 that, in determining the admissibility of tendency evidence given by two complainants against an accused, if a trial judge determines that the similarity in the complainants' accounts is capable of reasonable explanation on the basis of contamination, concoction or collusion, the evidence cannot possess sufficient probative value for the purposes of s 101 of the Evidence Act. In light of IMM, that approach must be taken as overruled. At common law, there is a need for separate judicial consideration of the risk of contamination, concoction or collusion, and a requirement that evidence be excluded if there is a reasonable possibility of it being affected by contamination, concoction or collusion. That requirement exists because of the common law rule of exclusion that, because tendency evidence is inadmissible unless there is no reasonable view of it consistent with innocence, tendency evidence is not admissible if there is a realistic possibility of it being affected by contamination, concoction or collusion76. Under the Evidence Act, the position is different. The replacement of the Hoch test with the less demanding s 97 criterion of significant probative value means that that common law rule of exclusion has no application. Under the Evidence Act, provided evidence is rationally capable of acceptance, the possibility of contamination, concoction or collusion falls to be assessed by the jury as part of the ordinary process of assessment of all factors that may affect the credibility and reliability of the evidence. 75 (2013) 40 VR 451 at 454-455 [4]-[8] per Redlich and Coghlan JJA, 475 [99] per Priest JA. 76 Hoch v The Queen (1988) 165 CLR 292 at 296-297 per Mason CJ, Wilson and Gaudron JJ, 302-303 per Brennan and Dawson JJ; Pfennig v The Queen (1995) 182 CLR 461 at 485 per Mason CJ, Deane and Dawson JJ; IMM v The Queen (2016) 257 CLR 300 at 348 [166] per Nettle and Gordon JJ. Bell Nettle Gordon Edelman Counsel for the respondent submitted that, even so, there remained a real possibility of contamination, concoction or collusion which rendered the tendency evidence inadmissible. That submission must be rejected. As both the trial judge and the Court of Appeal concluded77, there was "thin support" for any suggestion of contamination, concoction or collusion, and nothing submitted by counsel before this Court throws any doubt on that conclusion. (v) TB's evidence not excluded by s 101, s 135 or s 137 Counsel for the respondent further contended that, if TB's evidence were of sufficient probative value to pass the significant probative value test of s 97, it nevertheless lacked sufficient probative value substantially to outweigh the prejudicial effect of the evidence for the purposes of s 101, or to outweigh the danger of unfair prejudice within the meaning of ss 135 and 137. In counsel's submission, the risk of unfair prejudice inhered in the possibility that the jury would be overwhelmed by the nature and number of allegations, and so fail to pay sufficient regard to real questions of credibility and reliability that were said to arise. Counsel also instanced the possibility of the jury according undue weight to TB's evidence by reason of seeing her give her evidence as an adult rather than as the four to seven year old girl she had been at the time when the events in issue were alleged to have occurred. Counsel contended, too, that the evidence was unfairly prejudicial in that it required the respondent to answer a raft of uncharged acts stretching back decades, and that the process was made all the more unjust by reason of the fact that the record of interview of the respondent conducted in 2000 had been lost or destroyed. In counsel's submission, there was as well a further real risk of the jury failing to allow for the possibility that, although the respondent might once have had a sexual attraction to RC, and acted upon it, he might not have done so on the occasions of the charged offences; a possibility which, it was submitted, was made the more likely by the long period of time over which the offending was alleged to have occurred and the large number of charges preferred. And in counsel's submission, the evidence was confusing and had the potential to divert the jury from their task, especially given that the trial judge did not direct the jury that, before treating charged or uncharged acts as proof of the alleged tendency, the jury needed to be satisfied of those charged or uncharged acts beyond reasonable doubt. It was further contended that defence counsel could not provide the jury 77 Dennis Bauer (a pseudonym) (No 2) v The Queen [2017] VSCA 176 at [84]. Bell Nettle Gordon Edelman with a complete picture of the risk of contamination, concoction or collusion without introducing highly prejudicial material relating to allegations by other complainants. It followed, in counsel's submission, that TB's evidence should have been excluded and, therefore, that Charge 2 should have been severed. Those submissions are not persuasive. Despite textual differences between the expressions "prejudicial effect" in s 101, "unfairly prejudicial" in s 135 and "unfair prejudice" in s 137, each conveys essentially the same idea of harm to the interests of the accused by reason of a risk that the jury will use the evidence improperly in some unfair way78. Here there was not a real risk of the jury using the tendency evidence in such an unfair way. The jury were most unlikely to have been overwhelmed by the nature and number of allegations. The Crown case was essentially simple. Despite the number of charged and uncharged acts, the case presented was of an 11 year period over which the respondent offended against only one complainant, RC, as occasion presented, on the occasions of the charged acts. It is equally unlikely that the jury would have failed to consider the possibility that the respondent did not act on his sexual attraction to RC on the occasions of the charged acts. The trial judge several times specifically directed them that they could not convict the respondent of any charged act unless satisfied beyond reasonable doubt of the commission of that act, and further specifically directed them that they could not substitute evidence of other charged acts or other alleged uncharged acts, or a conclusion that the respondent had a sexual interest in RC, for what was alleged in the particular charge. There is no reason to doubt that the jury heeded those directions. The concern that the jury might have given undue weight to TB's testimony by reason of seeing her as an adult rather than as the child she was at 78 See BD (1997) 94 A Crim R 131 at 139 per Hunt CJ at CL, 148 per Smart J, 151 per Bruce J; Papakosmas v The Queen (1999) 196 CLR 297 at 325 [91]-[92] per McHugh J; [1999] HCA 37; R v Yates [2002] NSWCCA 520 at [252]; Ainsworth v Burden [2005] NSWCA 174 at [99] per Hunt AJA (Handley JA and McColl JA agreeing at [1], [2]); R v Ford (2009) 273 ALR 286 at 300-301 [55]-[58] per Campbell JA. See also Australian Law Reform Commission, Evidence, Report No 26 (Interim), (1985), vol 1 at 351-352 [644], 529 [957]; Odgers, Uniform Evidence Law, 13th ed (2018) at 780 [EA.101.190]. Bell Nettle Gordon Edelman relevant times is misplaced. The need to make allowance for TB's ageing was something which the trial judge considered and concluded was within the range of ordinary experience, and so could be left to the jury79. It is true that defence counsel sought an unreliable evidence direction in respect of TB's evidence, pursuant to s 32 of the Jury Directions Act 2015 (Vic), which the trial judge refused to give80. But it was not contended before the Court of Appeal or this Court that the trial judge was thus in error. The suggestion that TB's evidence was confusing is incorrect. It was not confusing but straightforward, and, if accepted, it was of strong probative value as evidence of events consistent with the existence of the respondent's sexual attraction to RC and a tendency to act upon it; which, because it came from a witness other than the complainant, gave it added credibility. Counsel for the respondent contended that confusion was likely to arise because of similarities and differences between TB's and RC's accounts of uncharged acts. Counsel instanced the fact that TB gave the evidence already mentioned of seeing the respondent at his home in RC's bed on top of RC moving up and down and that TB recalled that the respondent told her: "Get into fucken bed". TB gave evidence that she had asked RC the following day about why the respondent was in bed with RC, and that she had told her foster mother what she had seen. RC, on the other hand, gave evidence of an uncharged act which she said occurred at Port Macquarie involving the respondent coming into her room at night and assaulting her before TB entered the room and the respondent rolled off the bed. RC recalled that TB had asked her whether she was "having sex with dad" and that the following morning her foster mother had said to her that she had "heard that you were having sex with dad". In counsel's submission, the similarities and differences between those two accounts were bound to be confusing for the jury. There is no reason why that should be so. It was open to the jury to take the view that the similarities and differences threw doubt on the account of one or 79 Cf McKinney v The Queen (1991) 171 CLR 468 at 476 per Mason CJ, Deane, Gaudron and McHugh JJ; [1991] HCA 6. 80 See Jury Directions Act 2015 (Vic), ss 14, 31, 32; cf Arthur Hudson (a pseudonym) v The Queen [2017] VSCA 122 at [52], [61]. Bell Nettle Gordon Edelman other of the witnesses. But the jury were not bound to do so. For all that appears, the two witnesses were describing different, albeit similar uncharged acts, or, alternatively, one or other of them was mistaken about some of the peripheral details. Ultimately, the similarities and differences were in effect no more than factors which bore on the assessment of the credibility and reliability of the evidence of TB and RC, and that was a task that was well within the capacity of the jury. The argument that similarities and differences of that kind rendered TB's evidence so lacking in credibility or reliability as to make the evidence unfairly prejudicial to the respondent is untenable. No doubt the fact that the alleged events occurred so long before the trial and perhaps also that the record of the respondent's interview conducted in 2000 had been lost or destroyed were productive of forensic disadvantage to the respondent. But the jury were directed in terms which approximated closely to a Longman warning81 as to how to allow for the difficulties imposed on the respondent by reason of that kind of disadvantage and to assess the evidence accordingly. No exception was taken to that direction and it was not contended before the Court of Appeal or this Court that it was deficient. No error is shown, either, in relation to the trial judge's course in not warning the jury that they needed to be satisfied of uncharged acts beyond reasonable doubt82. Ordinarily, proof of the accused's tendency to act in a particular way will not be an indispensable intermediate step in reasoning to guilt83. And, in Victoria, the common law rule attributed to Shepherd v The Queen84, that in an appropriate case a jury should be directed that it must be 81 Longman v The Queen (1989) 168 CLR 79 at 91 per Brennan, Dawson and Toohey JJ, 101 per Deane J, 108-109 per McHugh J. See also Jury Directions Act, 82 HML v The Queen (2008) 235 CLR 334 at 390 [132], 396-397 [164], 405-406 [195]-[196], 407 [201], 415 [242], 416 [244] per Hayne J (Gummow J and Kirby J agreeing at 362 [41]-[42], 363-364 [46], 370-371 [61]-[63], 376-377 [81], [83]), 500 [506] per Kiefel J. 83 Shepherd v The Queen (1990) 170 CLR 573 at 584-585 per Dawson J; [1990] HCA 84 (1990) 170 CLR 573 at 584-585 per Dawson J. Bell Nettle Gordon Edelman satisfied beyond reasonable doubt of an indispensable fact, and the rule attributed to R v Sadler85, that a jury must be directed that it must be satisfied beyond reasonable doubt of uncharged acts that the jury may use as a step in their process of reasoning towards guilt, have been abolished by s 62 of the Jury Directions Act86. The trial judge did, however, and quite properly, specifically direct the jury as to how the evidence of uncharged acts could be used, as demonstrating a sexual attraction of the respondent to RC and a tendency to act upon it as the occasion presented, and equally that, if the jury were not satisfied beyond reasonable doubt that the act alleged in a particular charge occurred, they were bound to acquit the respondent of that charge. Further, as has been observed, her Honour specifically directed the jury that they could not substitute evidence of other charges or other alleged activity, or a conclusion that the respondent had a sexual interest in RC, for what was alleged in the particular charge. There is no reason to suppose that the jury failed to heed those directions. Finally on this aspect of the matter, for the reasons earlier given in relation to the probative value of TB's evidence, the risk of contamination, concoction or collusion was not something that fell to be considered in the determination of whether TB's evidence might cause the respondent improper prejudice. Since TB's evidence was not rationally incapable of acceptance, the risk of contamination, concoction or collusion was something to be left to the jury as part of their assessment of TB's credibility and reliability. And, as the trial judge held, whether defence counsel chose to put the allegations of other complainants to TB as indicative of contamination, concoction or collusion was entirely a matter for defence counsel in the exercise of forensic choice. It was not improper prejudice. The trial judge was correct not to exclude TB's tendency evidence pursuant to s 101 or, therefore, ss 135 and 13787. 85 (2008) 20 VR 69 at 89 [67]. 86 See also Jury Directions Act, s 61; Beqiri v The Queen [2017] VSCA 112 at [121], 87 See R v WRC (2002) 130 A Crim R 89 at 103 [34] per Hodgson JA (Kirby J agreeing at 133 [123]); R v Ngatikaura (2006) 161 A Crim R 329 at 343 [71] per (Footnote continues on next page) Bell Nettle Gordon Edelman (vi) Form of tendency notice As noticed at the outset of these reasons, the Crown's tendency notice particularised the 18 charged acts and a further seven uncharged acts that were alleged to establish a tendency on the part of the respondent "to have a sexual interest in his foster daughter [RC]" and "a willingness to act on that sexual interest in respect of [RC]" on which the Crown would rely in proof of all charges. Counsel for the respondent submitted that the notice was defective in taking a "broad-brush" approach that failed to identify which charged and uncharged acts were cross-admissible in relation to which charges and for what purpose. The submission must be rejected. The notice was in a conventional form for a single complainant sexual offences case and, subject to a couple of errors that were corrected by the prosecutor in the course of pre-trial oral argument, made clear that the tendency sought to be established and admitted in relation to all charges was a tendency to have a sexual interest in RC (which it was proposed to prove by proof of the acts and circumstance precisely identified in Table B) and a willingness to act upon it (which it was proposed to prove by the acts and circumstances precisely identified in Table C); each fact and circumstance described in Tables B and C being therein precisely cross-referenced to the evidence that it was proposed to adduce in proof of it. A footnote stated that each charged act was cross-admissible and each uncharged act was admissible in proof of each charged act. The notice as corrected by the prosecutor left no room for doubt and thus satisfied the requirement in s 97(1)(a) of the Evidence Act. Ground 2 should be upheld. (vii) Jury directions in single complainant sexual offences cases Before departing from Ground 2, however, it is appropriate to say something further of the directions ordinarily to be given to a jury in a single complainant sexual offences case where the Crown is permitted to adduce evidence of uncharged acts as evidence of the accused having a sexual interest in Simpson J (Rothman J agreeing at 343 [74]); R v Ford (2009) 273 ALR 286 at 300-301 [55]-[59] per Campbell JA; cf Odgers, Uniform Evidence Law, 13th ed (2018) at 786 [EA.101.195]. Bell Nettle Gordon Edelman the complainant and a tendency to act upon it. Where evidence is admitted on that basis, the trial judge should direct the jury that the Crown argues that the evidence establishes that the accused had a sexual interest in the complainant and a tendency to act upon it which the Crown contends makes it more likely that the accused committed the charged offence or offences. If the Crown also relies on the evidence as putting the charged offence or offences in context in some other identified fashion or respects, the trial judge should further direct the jury that the Crown contends that the evidence serves also to put the charged offence or offences in context and identify the manner or respects in which the Crown contends that it does so. The trial judge should stress that the evidence of uncharged acts has been admitted for those purposes and, if the jury are persuaded by it, that it is open to the jury to use the evidence in those ways, although no other. The trial judge should further stress that it is not enough, however, to convict the accused that the jury may be satisfied of the commission of the uncharged acts or that they establish that the accused had a sexual interest in the complainant on which the accused had acted in the past; it remains that the jury cannot find the accused guilty of any charged offence unless upon their consideration of all of the evidence relevant to the charge they are satisfied of the accused's guilt of that offence beyond reasonable doubt. Contrary to the practice which has operated for some time in New South Wales88, trial judges in that State should not ordinarily direct a jury that, before they may act on evidence of uncharged acts, they must be satisfied of the proof of the uncharged acts beyond reasonable doubt. Such a direction should not be necessary or desirable unless it is apprehended that, in the particular circumstances of the case, there is a significant possibility of the jury treating the uncharged acts as an indispensable 88 See for example DJV v The Queen (2008) 200 A Crim R 206 at 217 [30] per McClellan CJ at CL (Hidden J and Fullerton J agreeing at 227 [58], [59]); R v FDP (2008) 74 NSWLR 645 at 654 [38]; DJS v The Queen [2010] NSWCCA 200 at [54]-[55] per Hodgson JA (Kirby J and Whealy J agreeing at [86], [87]). Bell Nettle Gordon Edelman link in their chain of reasoning to guilt89. And, as explained earlier in these reasons, a trial judge is precluded from giving such a direction in Victoria90. In this matter it has not been suggested that the trial judge's directions fell short of those requirements in any material respect. Ground 3: severance The only basis on which it was contended that Charge 2 should have been severed and tried alone was that TB's evidence was not admissible in proof of the other charges. As has been explained, it was. For the reasons earlier stated, the trial judge was correct to hold that there was no basis for the severance of Charge 291. Ground 3 should be upheld. Ground 4: complaint evidence (i) Fresh in the memory In Graham v The Queen92, a majority of this Court held that, as s 66 of the Evidence Act 1995 (NSW) was then drafted, its use of the word "fresh" imported a close temporal relationship between the occurrence of the asserted fact and the time of making the representation and hence that contemporaneity was the most 89 Shepherd v The Queen (1990) 170 CLR 573 at 584-585 per Dawson J; Gipp v The Queen (1998) 194 CLR 106 at 133 [79] per McHugh and Hayne JJ; [1998] HCA 21; HML v The Queen (2008) 235 CLR 334 at 360-361 [31]-[32] per Gleeson CJ in diss on point, 490 [477] per Crennan J in diss on point. 90 See Jury Directions Act, ss 61, 62; Beqiri v The Queen [2017] VSCA 112 at [121], 91 See generally Criminal Procedure Act, s 194; Sutton v The Queen (1984) 152 CLR 528 at 531, 537 per Gibbs CJ, 539 per Murphy J, 542, 554 per Brennan J, 561 per Deane J, 569 per Dawson J; De Jesus v The Queen (1986) 61 ALJR 1 at 3 per Gibbs CJ, 7 per Brennan J, 8-10 per Dawson J; 68 ALR 1 at 4-5, 12, 14-16; [1986] HCA 65; James Baker (a pseudonym) v The Queen [2015] VSCA 323 at [67]-[71]. 92 (1998) 195 CLR 606 at 608 [4] per Gaudron, Gummow and Hayne JJ, see also at 614 [34] per Callinan J (Gleeson CJ agreeing at 608 [1]); [1998] HCA 61. Bell Nettle Gordon Edelman important consideration in assessing a representation under that section. Thereafter, sub-s (2A) was inserted into s 66 of the Evidence Act to make clear that the intention of the section is that "freshness" is not confined to the time which elapses between the occurrence of the relevant event and the making of the representation about that event93. Since then, it has rightly come to be accepted by intermediate courts of appeal that the nature of sexual abuse is such that it may remain fresh in the memory of a victim for many years94. It depends on the facts of the case. Here there was evidence from which it could be inferred that the facts were "fresh in the memory" of RC at the time that she made the representations to AF. As was earlier observed, it established that, during the holiday period between December 1997 and January 1998, when RC was in Year 8 at school, she moved into AF's home and thereafter lived with AF and AF's family until RC completed Year 12 some four years later. Shortly after moving in, when RC was around 15 years old, she had a conversation with AF in which she disclosed to AF that she had been sexually assaulted by the respondent. According to AF's effectively unchallenged testimony, the conversation proceeded thus: "[AF]: [RC] and I shared a bedroom, so we were in our bedroom and we were talking. I can't particularly remember what stroke – struck the conversation but we were talking about, I don't know, life in general and, you know, she was sad about her real father that had died, and she missed him and she missed having a real family. And then, you know, she was really upset and crying, and so I was pushing her, you know, 'What's 93 Australian Law Reform Commission, New South Wales Law Reform Commission and Victorian Law Reform Commission, Uniform Evidence Law, (December 2005) [8.122]-[8.124]; Victoria, Evidence Bill 2008, Explanatory Memorandum at 22. 94 See for example R v XY (2010) 79 NSWLR 629 at 646-648 [91]-[92], [98]-[99] per Whealy J (Campbell JA and Simpson J agreeing at 630 [1], [2]); LMD v The Queen [2012] VSCA 164 at [24] per Harper JA (Bongiorno JA and Davies AJA agreeing at [39], [40]); ISJ v The Queen (2012) 38 VR 23 at 37 [48]; Clay (A Pseudonym) v The Queen (2014) 43 VR 405 at 413-414 [38]-[48]; Pate v The Queen (2015) 250 A Crim R 425 at 437-438 [62]-[65] per Weinberg JA (Dixon AJA agreeing at 456 Bell Nettle Gordon Edelman wrong, what's going on', and then that's when she went on to say 'There's, you know, something I need to tell you about my foster family, something that happened while I was there'. She was crying, and so I asked her what was wrong, and she said that it was something that happened back at her foster family. And I said, 'Well, what, did they mistreat you, what happened?' She said that – she started with that her foster mother Jan was very mean to her and she made her do a lot of chores ... and then, you know, she went on crying and I was thinking, okay, so what else is there, and she said, you know, 'Something that, you know, my father did to me'. And I said, 'Well, what?' So she made me guess, and from her way that she was obviously distraught I eventually after a while said 'Was it sexual harassment?' and she said 'Yes'. I asked her what he did to her and she didn't want to tell me. She asked me to guess. So I guessed a few things. There's some words in my statement. I probably don't like to use those words these days but - - - Well, the words that I used were things like 'Did you toss him off?' Sorry, I find it hard to say but anyway, she said 'Yes'. She – and I said 'Did you have to' – you know – 'suck him off' is the word I used at that time, and she said 'Yes'. And I remember she said that he made her watch pornographic videos and make her act out what was done in those videos, yeah but - - - He just used to say that – she said when – when the family used to go out and he would come and get her from the room and, you know, she would pretend to sleep and – but he obviously would wake her up or know that she was pretending and then make her do these things. She would have to touch him obviously inappropriately and watch those videos - - - [PROSECUTOR]: ... Can you ... tell us what she said he did? Bell Nettle Gordon Edelman [AF]: Well, touching his penis. [PROSECUTOR]: All right. In terms of the touching did she tell you that she would have to touch him and he would touch her, or what was said about that? [AF]: All she said was that she was made to touch him. I said 'Did he' ... 'Did he make you have sex with him or did he' – I used the word 'finger', and she said 'No' at that point." Contrary to the Court of Appeal's reasoning, RC's representations were not generic, they were specific: "Something that ... my father did to me"; "when the family used to go out ... he would come and get her from the room and, you know, she would pretend to sleep and – but he obviously would wake her up or know that she was pretending and then make her do these things"; "She would have to touch him obviously inappropriately and watch those videos ... touching his penis"; and she had to "toss him off" and "suck him off". Granted, RC did not specify when the acts occurred, but, in the terms in which she spoke, it is apparent that such acts were repeated many times in the period which extended up until RC moved out of the respondent's home relatively shortly before moving in with AF. Contrary also to the Court of Appeal's reasoning, the circumstances of their commission were specified, namely, when the family used to go out and the respondent would get RC out of bed. Admittedly, the representations that she had to "toss him off" and "suck him off" were made in response to leading questions. But in contrast to the position at common law95, under s 66 the fact that representations are made in response to leading questions does not of itself render evidence of the representations inadmissible. It goes to the weight of the evidence, which, as has 95 R v Stewart (1920) 21 SR (NSW) 33 at 35-36 per Pring J (Ferguson J and Wade J agreeing at 37); R v Freeman [1980] VR 1 at 5-8; R v EF (2008) 189 A Crim R 463 at 471-473 [47]-[54] per Weinberg JA (Nettle JA and Mandie AJA agreeing at 464 [1], 473 [56]); R v Ahmet (2009) 22 VR 203 at 210-211 [46]-[49] per Ashley JA (Buchanan JA and Vincent JA agreeing at 204 [1], [2]). Bell Nettle Gordon Edelman been emphasised, is for the jury to assess96. Moreover, seen in the context of the remainder of the conversation, the fact that those few answers were given in response to leading questions does not suggest that RC's recollection of "tossing off" or "sucking off" the respondent were any less vivid or fresh in her memory than the recollections she disclosed to AF, without being led, of being taken out of bed when the family was away and made to touch the respondent's penis and watch pornographic videos and act out what was done in them. To the contrary, given the nature of the sexual acts alleged, the fact that they were repeated time and again over a period of years, the fact that it seems they continued up to less than a year before the conversation with AF, and RC's highly emotional state at the time of the conversation with AF, it is very probable that the events disclosed to AF were vivid in RC's recollection at the time of the conversation and would remain so for years to come97. Counsel for the respondent contended that there were inconsistencies between RC's representations to AF and other evidence which belied the finding that the events were fresh in RC's memory at the time of the representations. Counsel instanced the fact that RC denied to AF that the respondent had "fingered" her, and contrasted that with RC's evidence at trial that the respondent had many times touched and digitally penetrated her vagina. Counsel also emphasised that RC had told AF that AF was the first person to whom RC had disclosed the respondent's abuse, and contrasted that with RC's evidence at trial that she had already told another friend and that friend's mother about the abuse when she was 12 years old. Such inconsistencies do not belie that the events the subject of the representations to AF were fresh in the memory of RC at the time of the representations. Arguably, RC's reticence to mention to AF that she had been "fingered" by the respondent might be taken to mean that RC's subsequent allegations of digital penetration were untrue. But, in view of RC's age at the time of the representations to AF and the enormity of the respondent's alleged 96 See R v XY (2010) 79 NSWLR 629 at 646 [89]-[90] per Whealy J (Campbell JA and Simpson J agreeing at 630 [1], [2]). 97 See and compare R v Le [2000] NSWCCA 49 at [52] per Sully J (Hidden J agreeing at [124]-[127]), [82]-[84] per Hulme J; R v XY (2010) 79 NSWLR 629 at 647 [92] per Whealy J (Campbell JA and Simpson J agreeing at 630 [1], [2]). Bell Nettle Gordon Edelman offending, the jury would have been at least as entitled to conclude that RC was simply not ready at that stage to tell her best friend of the full extent of her violation. The fact that RC might have told someone else of the matter before RC told AF is of little significance. It could mean that, by the time RC came to give evidence at trial, she was mistaken about whom she first told about the respondent's offending. Equally, it could mean that RC's statement to AF that AF was the first to be told was either mistakenly or deliberately untrue. Logically, however, it says little if anything at all as to whether the matters which RC disclosed to AF were fresh in RC's recollection at the time of the representations. (ii) AF's evidence not excluded under s 137 The Court of Appeal were wrong to hold that AF's evidence should have been excluded under s 137. As has been emphasised, it is not for a trial judge to say what probative value a jury should give to evidence but only what probative value the jury acting rationally and properly directed could give to the evidence. Hence, unless evidence is so lacking in credibility or reliability that it would not be open to a jury acting rationally and properly directed to accept it, the probative value of the evidence must be assessed, for the purposes of s 137, at its highest. Counsel for the respondent submitted that, because of what she contended was the "general" nature of RC's description of the offending, it was impossible to say whether RC's representations to AF related to any of the charged offences, and, therefore, impossible to tell whether RC's representations had any significant probative value. That is not so. To repeat, the Crown case was that the respondent offended against RC frequently over a period of approximately 11 years and the charged offences comprised just some of the totality of that offending. Evidence of the uncharged acts over that period of 11 years was therefore admissible as evidence of the respondent's sexual attraction to RC and his tendency to act upon it as occasion presented during that period, which logically made it more likely that he committed the charged offences over that period. In those circumstances, it is hardly to the point that the jury may not have been able to say whether RC's representations to AF specifically related to any of the charged offences as opposed to the uncharged acts. It might have been different if, say, there had been but one charged offence and RC's representations to AF had been confined to an isolated incident of offending that occurred years before or after the charged offence. In such a case, it would be much less likely that the evidence of the previous offending Bell Nettle Gordon Edelman would be sufficiently pertinent to the charged offence, or otherwise indicative of a sexual attraction and a tendency to act upon it, to render it admissible as tendency evidence. But here, because of the continuum of alleged offending over the 11 year period in issue, the evidence of RC's representations to AF was significantly probative of each of the charged offences during that period. If accepted, it was confirmatory of RC's testimony that the respondent offended against her frequently throughout the 11 years and thereby confirmatory of the existence of the respondent's sexual attraction to RC and his tendency to act upon it over that period of time by offending against her as the occasion presented. Nor did the fact that some of RC's representations to AF were made in response to AF's leading questions deprive them of credibility or reliability to such an extent as to render them rationally incapable of acceptance. It was open to the jury to accept defence counsel's invitation to discount the probative value of the representations on the basis that some of them were made in response to AF's leading questions or because of the time at which they were made or the time at which the represented events were alleged to have occurred. But the jury were not logically bound so to discount them. For the reasons already given, the jury were at least as much entitled to conclude that RC's representations to AF had the compelling ring of truth and reliability about them and hence that AF's testimony significantly supported the credibility and reliability of RC's testimony concerning the charged offences. Counsel for the respondent submitted that, because AF had very little independent recollection of the representations by the time of trial and in effect was merely repeating the statement which she had made to police many years before, the respondent was so unfairly prejudiced by AF's evidence that it should have been excluded. That submission should also be rejected. If AF's state of recollection by the time of trial were productive of any forensic disadvantage for the respondent it was certainly not so great as to warrant the exclusion of her evidence. AF readily conceded in response to defence counsel's questioning that her state of recollection was limited and, as has been seen, the trial judge gave the jury full directions on how they should allow for any problems for the respondent to which that might give rise. There being little if any risk that the jury would reason improperly from RC's representations to a conclusion of guilt, the trial judge was right to conclude that the probative value of AF's evidence sufficiently outweighed its prejudicial effect as to avoid exclusion pursuant to s 137. Ground 4 should be upheld. Bell Nettle Gordon Edelman Cross-appeal The respondent sought leave to cross-appeal on the basis that, if the Court of Appeal were correct in concluding that his convictions should be quashed, the Court of Appeal erred in ordering that a new trial be had. For the reasons given, the Court of Appeal should not have ordered that the convictions be quashed, and accordingly the application for leave to cross-appeal should be refused. Conclusion and orders The appeal should be allowed on all grounds and the application for leave to cross-appeal should be refused. Orders 2 to 4 of the Court of Appeal should be set aside and in their place it should be ordered that the appeal to the Court of Appeal be dismissed.
HIGH COURT OF AUSTRALIA Matter No S172/2012 MAN HARON MONIS AND APPELLANT THE QUEEN & ANOR RESPONDENTS Matter No S179/2012 AND APPELLANT THE QUEEN & ANOR RESPONDENTS Monis v The Queen [2013] HCA 4 27 February 2013 S172/2012 & S179/2012 ORDER In Matter No S172/2012: Appeal dismissed. In Matter No S179/2012: Appeal dismissed. On appeal from the Supreme Court of New South Wales Representation G O'L Reynolds SC with J C Hewitt and G R Rubagotti for the appellant in S172/2012 (instructed by Aston Legal) D M J Bennett QC with A K Flecknoe-Brown for the appellant in S179/2012 (instructed by CBD Criminal Defence Lawyers) J V Agius SC with M G McHugh for the first respondent in both matters (instructed by Commonwealth Director of Public Prosecutions) M G Sexton SC, Solicitor-General for the State of New South Wales with S E Pritchard for the second respondent in both matters (instructed by Crown Solicitor (NSW)) Interveners T M Howe QC with R J Orr for the Attorney-General of the Commonwealth, (instructed by Australian Government Solicitor) intervening M G Hinton QC, Solicitor-General for the State of South Australia with L K Byers for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor (SA)) S G E McLeish SC, Solicitor-General for the State of Victoria with A D Pound for the Attorney-General for the State of Victoria, intervening (instructed by Victorian Government Solicitor) G R Donaldson SC, Solicitor-General for the State of Western Australia with J E Shaw for the Attorney-General for the State of Western Australia, intervening (instructed by State Solicitor (WA)) G J D del Villar for the Attorney-General of the State of Queensland, intervening (instructed by Crown Law (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Monis v The Queen Constitutional law – Implied freedom of communication on government and political matters – Criminal offence under s 471.12 of Criminal Code (Cth) for person to use postal or similar service in way that "reasonable persons would regard as being, in all the circumstances, menacing, harassing or offensive" – Appellants allegedly sent communications to relatives of Australian soldiers and officials killed in Afghanistan and Indonesia – Communications criticised deployment of Australian troops in Afghanistan in terms critical of deceased – Appellants charged with using and aiding and abetting use of postal service in way that reasonable persons would regard as offensive – Whether s 471.12 in its application to "offensive" uses of postal service effectively burdens implied freedom of political communication – Whether s 471.12 in its application to "offensive" uses of postal service is reasonably appropriate and adapted to legitimate end in manner compatible with system of representative and responsible government. Statutes – Interpretation – Whether purpose of s 471.12 of Criminal Code (Cth) in its application to "offensive" uses of postal service is only to prohibit those offensive uses – Whether purpose of s 471.12 in its application to "offensive" uses of postal service is to prohibit misuse of service for intrusion of seriously offensive material into home or workplace – Whether s 471.12 in its application to "offensive" uses of postal service is limited to seriously offensive uses. Words and phrases – "effectively burden", "legitimate end", "offensive", "proportionality", "reasonable person", "reasonably appropriate and adapted". Constitution, ss 7, 24, 128. Criminal Code (Cth), Div 471, s 471.12. Introduction These appeals arise out of charges laid against the appellants, one of whom, Man Haron Monis, is said, in 2007, 2008 and 2009, to have written letters1 to parents and relatives of soldiers killed on active service in Afghanistan which were critical of Australia's involvement in that country and reflected upon the part played in it by the deceased soldiers. The other appellant, Amirah Droudis, is said to have aided and abetted him in relation to a number of those letters. The appellants were charged under s 471.12 of the Criminal Code (Cth) ("the Code"), which prohibits the use of a postal or similar service in a way that reasonable persons would regard as being, in all the circumstances, "offensive". The Australian Constitution limits the power of parliaments to impose burdens on freedom of communication on government and political matters. No Australian parliament can validly enact a law which effectively burdens freedom of communication about those matters unless the law is reasonably appropriate and adapted to serve a legitimate end in a manner compatible with the maintenance of the constitutionally prescribed system of government in Australia. The question in these appeals is whether the provision under which the appellants were charged exceeds the limits of the legislative power of the Commonwealth Parliament because it impermissibly burdens freedom of communication about government or political matters. The answer to the question is in the affirmative. That answer depends upon the proper interpretation, legal effect, operation and purpose of the It does not depend upon any opinion about or impugned provision. characterisation of the conduct said to have given rise to the charges. Nor does it involve any general conclusion about the extent of Commonwealth power to legislate in respect of such conduct. Factual and procedural background Mr Monis was charged on indictment in the District Court of New South Wales on 12 April 2011 with 13 offences against s 471.12 of the Code. Ms Droudis was charged on the same indictment with eight counts alleging that she aided and abetted the commission of offences against s 471.12 by Mr Monis. A typical count against Mr Monis alleged that he: "On about 27 November 2007 at Sydney, New South Wales, used a postal service, namely Australia Post, in a way that reasonable persons would regard as being, in all the circumstances, offensive by sending a letter In one case a sound recording was said to have been sent. dated 25 November 2007 addressed to Mr John Worsley, the father of Private Luke Worsley, an Australian Defence Force Soldier killed in action on 23 November 2007 … Contrary to section 471.12 of the Criminal Code 1995". Section 471.12 of the Code provides: "A person is guilty of an offence if: the person uses a postal or similar service; and the person does so in a way (whether by the method of use or the content of a communication, or both) that reasonable persons would regard as being, in all the circumstances, menacing, harassing or offensive. Penalty: Imprisonment for 2 years." The letters that were the subject of the charges were described by Bathurst CJ in the Court of Criminal Appeal of New South Wales2 as "at one level ... critical of the involvement of the Australian Military in Afghanistan" but also as referring "to the deceased soldiers in a denigrating and derogatory fashion."3 The appellants filed notices of motion in the District Court seeking to have the indictment quashed on the basis that s 471.12 was invalid because it infringed the constitutional implied freedom of political communication. On 18 April 2011, Tupman DCJ dismissed the motions. Appeals to the Court of Criminal Appeal under s 5F of the Criminal Appeal Act 1912 (NSW)4 were dismissed on 6 December 2011. On 22 June 2012 the appellants were granted special leave to appeal to this Court from the decision of the Court of Criminal Appeal. The appeals to the Court of Criminal Appeal and to this Court were concerned only with the validity of s 471.12 in so far as it relates to "offensive" uses of a postal service. A challenge to the harassment limb of s 471.12, which was argued in the District 2 Monis v The Queen (2011) 256 FLR 28. (2011) 256 FLR 28 at 30 [4]. 4 Section 5F of the Criminal Appeal Act 1912 (NSW) provides for appeals to the Court of Criminal Appeal against an interlocutory judgment or order given in proceedings to which the section applies. That includes proceedings for the prosecution of offenders on indictment in the Supreme Court or the District Court. Court, was abandoned in the Court of Criminal Appeal and not pursued in this Court. The statutory framework Section 471.12 appears in Pt 10.5 of Ch 10 of the Code. Chapter 10 is entitled "National infrastructure". Part 10.5 is entitled "Postal services". Section 470.1 sets out an important definition of the term "postal or similar service". That term means, inter alia: a postal service (within the meaning of paragraph 51(v) of the Constitution); or a courier service, to the extent to which the service is a postal or other like service (within the meaning of paragraph 51(v) of the Constitution); or a packet or parcel carrying service, to the extent to which the service is a postal or other like service (within the meaning of paragraph 51(v) of the Constitution); or any other service that is a postal or other like service (within the meaning of paragraph 51(v) of the Constitution)". In reliance upon the legislative powers conferred on the Commonwealth Parliament by s 51(i) and (xx) of the Constitution the definition is extended to cover courier and packet or parcel carrying services provided in the course of or in relation to interstate or overseas trade or commerce5 and such services provided by constitutional corporations6. The extended definition is not limited to courier or packet or parcel carrying services which are "postal or other like services" within the meaning of s 51(v) of the Constitution. Thus a packet or parcel carrying service conducted by a trading corporation and distributing pamphlets, brochures or other literature and video or audio recordings would appear to be within the extended definition. Offences created under Div 471 include the theft and receiving, taking or concealing of mail-receptacles, articles or postal messages7. The Division creates offences relating to damaging or destroying mail-receptacles, articles or 5 The Code, s 470.1. 6 The Code, s 470.1. 7 The Code, ss 471.1, 471.2, 471.3. personal messages8 and tampering with mail-receptacles9. It is an offence to cause an article to be carried by a postal or similar service with the intention of inducing a false belief that it consists of, encloses or contains an explosive or a dangerous or harmful substance or thing or that such a substance or thing has been or will be left in any place10. It is an offence to use a postal or similar service to make a threat to kill another person or to cause serious harm11. It is also an offence to cause a dangerous article to be carried by a postal or similar service12 or to cause an explosive or a dangerous or harmful substance to be There is no doubt that a purpose of Div 471 of the Code is to prevent interference with or disruption of postal and similar services and the use of those services for criminal purposes. A number of the offences created by that Division cover conduct similar to conduct which would be criminal under provisions of State law14 not specific to the use of postal services. The impugned provision, so far as it relates to "offensive" use of a postal or similar service, does not appear to have any precise counterpart in the general criminal law concerning offences involving the sending or delivering of things from one person to another. The offence of "stalking" under South Australian and Tasmanian law covers sending offensive material to a person but in a manner which would reasonably be expected to cause the recipient apprehension or fear15. There is no equivalent limitation on the offensive use limb of s 471.12. The latter offence does, however, have mental or "fault" elements. The "general principles of criminal responsibility" set out in the Code apply to all offences under the Code. The elements of offences are classified as 8 The Code, s 471.6. 9 The Code, s 471.7. 10 The Code, s 471.10. 11 The Code, s 471.11. 12 The Code, s 471.13. 13 The Code, s 471.15. 14 For example see Crimes Act 1900 (NSW), ss 31, 47, 93R; Crimes Act 1958 (Vic), s 317A; Criminal Law Consolidation Act 1935 (SA), ss 248, 250; Criminal Code (Q), s 321A; Criminal Code (WA), s 294(4); Criminal Code (Tas), ss 170, 192. 15 Criminal Law Consolidation Act 1935 (SA), s 19AA(1)(a)(iv), (iva) and (ivb); see also Criminal Code (Tas), s 192(1)(f) and (g) and (3). physical and fault elements16. Physical elements may consist of conduct or a result of conduct or a circumstance in which conduct or a result of conduct occurs17. A fault element may be "intention, knowledge, recklessness or negligence"18. Where no fault element is specified for a physical element consisting only of conduct, the Code provides that intention is the fault element for that physical element19. If a physical element for which no fault element is specified consists of a circumstance or a result, recklessness is the fault element for that physical element20. A person is reckless with respect to a circumstance he or she is aware of a substantial risk that the circumstance exists or will exist; and having regard to the circumstances known to him or her, it is unjustifiable to take the risk." A similar test applies to recklessness with respect to a result22. The question whether taking a risk is unjustifiable is a question of fact23. Where recklessness is a fault element, proof of intention, knowledge or recklessness will satisfy that element24. The Commonwealth, supported by the Attorney-General for Victoria, submitted that the offence created by s 471.12, in its application to offensive uses, comprises two physical elements: 16 The Code, s 3.1(1). 17 The Code, s 4.1(1). 18 The Code, s 5.1(1). 19 The Code, s 5.6(1). 20 The Code, s 5.6(2). 21 The Code, s 5.4(1). 22 The Code, s 5.4(2). 23 The Code, s 5.4(3). 24 The Code, s 5.4(4). The use of a postal or similar service; The circumstance that the use of the service would be regarded by reasonable persons as being, in all the circumstances, offensive. That submission was not disputed and, subject to one qualification, should be accepted. The qualification is that the characterisation of the use of a postal or similar service as "offensive" is better regarded as a "circumstance" than as a "result" of the conduct25. It is not a "result" because, being framed objectively by reference to how "reasonable persons" would regard the conduct, it does not import a requirement that any person was actually offended26. On that basis the fault element of intention applies to the use of the postal or similar service. The fault element of recklessness applies to the characterisation of the use as offensive. It follows that to establish the offence of offensive use of a postal or similar service it is necessary to prove at least that: The accused used a postal or similar service; The accused intended to do so; The accused did so in a way, whether by method of use or the content of a communication, that reasonable persons would regard as being in all the circumstances offensive; The accused was aware of a substantial risk that the way in which he or she used the service would be regarded by reasonable persons as being in all the circumstances offensive; and Having regard to the circumstances known to the accused it was unjustifiable to take the risk. 25 See similarly worded s 474.17 of the Code, which applies to the use of carriage services, the elements of which were considered in Crowther v Sala [2008] 1 Qd R 127 at 136–137 [47]–[48] per Philip McMurdo J, Muir J concurring at 133 [30]. 26 A longstanding construction of "offensive" as distinct from "offend" or "offends": Inglis v Fish [1961] VR 607 at 611 per Pape J; Ellis v Fingleton (1972) 3 SASR 437 at 440–443 per Mitchell J and authorities there cited; Khan v Bazeley (1986) 40 SASR 481 at 483 per O'Loughlin J. It nevertheless does not resolve the difficulty of determining the assumed perspective of the "reasonable person", discussed at [44]–[47] of these reasons. In its application to the content of communications delivered using postal or similar services, the prohibition applies to communications the content of which reasonable persons would regard as being in all the circumstances offensive, whether or not anyone was actually offended by it. A provision of the law of the United Kingdom, which bears some resemblance to s 471.12 but is not confined to postal or similar services, is s 1(1) of the Malicious Communications Act 1988 (UK). That provision makes it an offence to send a person any article "which is, in whole or part, of an indecent or grossly offensive nature". However, unlike the offence created by s 471.12 of the Code, the sender must have the purpose of causing distress or anxiety to the recipient. As appears from the discussion of the physical and fault elements of the offence created by s 471.12, it is not necessary, in order to prove that offence, to demonstrate that the use of the postal or similar service was for a particular purpose. Another imperfect analogue of the offence created by s 471.12 is found in s 127(1)(a) of the Communications Act 2003 (UK). That provision makes it an offence to send a message that is grossly offensive by means of a "public electronic communications network"27. Its object, as formulated in the decision of the House of Lords in Director of Public Prosecutions v Collins28, is "to prohibit the use of a service provided and funded by the public for the benefit of the public for the transmission of communications which contravene the basic standards of our society."29 Lord Brown, who joined in that formulation, also described the provision as "intended to protect the integrity of the public communication system"30. the Malicious Communications Act, which is not linked to the use of postal or other communications systems, was described in Collins as "to protect people against receipt of unsolicited messages which they may find seriously objectionable."31 The purpose of s 1(1) of 27 Defined as "an electronic communications network provided wholly or mainly for the purpose of making electronic communications services available to members of the public": Communications Act 2003 (UK), s 151. 28 [2006] 1 WLR 2223; [2006] 4 All ER 602. 29 [2006] 1 WLR 2223 at 2227 [7] per Lord Bingham, Lord Nicholls and Baroness Hale agreeing at 2229 [16], [17]; [2006] 4 All ER 602 at 607, 609. 30 [2006] 1 WLR 2223 at 2232 [27]; [2006] 4 All ER 602 at 612. 31 [2006] 1 WLR 2223 at 2227 [7] per Lord Bingham; [2006] 4 All ER 602 at 607. The Malicious Communications Act gave effect to a recommendation of the Law Commission in a report, published in 1985, on "Poison-Pen Letters"32. The Commission observed that there were no judicial decisions on the meaning of the term "grossly offensive" but had no reason to suppose that it had given rise to any difficulty33. More than twenty years later in Connolly v Director of Public Prosecutions34 those words were held to be ordinary English words and to apply to the conduct of an anti-abortion campaigner who sent photographs of aborted foetuses through the mail to pharmacists. Dyson LJ, with whom Stanley Burnton J concurred, construed s 1(1), pursuant to the requirements of the Human Rights Act 1998 (UK), in light of the freedom of expression declared in Art 10(1) of the European Convention on Human Rights. Section 1(1) was found to infringe that freedom. It was nevertheless held to be justified under Art 10(2) as "necessary in a democratic society … for the protection of the … rights of others". Those were the "rights" of the recipients of the letters not to receive grossly offensive photographs of aborted foetuses at their place of work where the photographs were sent for the purpose of creating distress or anxiety35. They were rights formulated by applying the statutory prohibition to the facts of the particular case36. A similar approach, albeit in a different statutory context, appears in a number of the judgments of the House of Lords in R (ProLife Alliance) v British Broadcasting Corporation37. Their Lordships reversed a decision of the Court of Appeal allowing judicial review of a refusal by the BBC to transmit a political party broadcast showing images of aborted foetuses. The refusal was based on the opinion that the material would be "offensive to public feeling" within the meaning of s 6(1)(a) of the Broadcasting Act 1990 (UK). That statutory standard was linked to a general rubric of "taste and decency". Lord Nicholls said it was not for the Court to carry out a balancing exercise "between the requirements of 32 The Law Commission, Criminal Law: Report on Poison-Pen Letters, Law Com 33 The Law Commission, Criminal Law: Report on Poison-Pen Letters, Law Com No 147, (1985) at 17 [4.15]. 34 [2008] 1 WLR 276; [2007] 2 All ER 1012. 35 Connolly v Director of Public Prosecutions [2008] 1 WLR 276 at 285 [28] per Dyson LJ; [2007] 2 All ER 1012 at 1021–1022. 36 For a critical discussion of the "rights of others" approach, see Khan, "A 'Right Not to be Offended' Under Article 10(2) ECHR? Concerns in the Construction of the 'Rights of Others'", (2012) European Human Rights Law Review 191. freedom of political speech and the protection of the public from being unduly distressed in their own homes."38 Parliament had struck the balance39. Lord Hoffmann referred to the statutory standard as having "created expectations on the part of the viewers as to what they will and will not be shown on the screens in their homes."40 Lord Walker referred to the "right" of the citizen "not to be shocked or affronted by inappropriate material transmitted into the privacy of his home."41 Putting to one side whether such a right existed under the European Convention, his Lordship characterised it as an "indisputable imperative"42. No negative juristic right, equivalent to those formulated in Connolly and ProLife, can be derived from s 471.12 of the Code. It was not suggested that such a thing exists at common law. Nor should such a right be conjured in order to erect a statutory purpose to protect it. The use of the term "rights of others" as a source of rights beyond those enumerated in the European Convention on Human Rights and derogating from the freedom of expression in Art 10(1) has been criticised in terms relevant to "rights of others" analysis in Australia43: "Such a potentially limitless pool of 'countervailing rights' is deeply unattractive and troubling, threatening as it does to swallow up the right to freedom of expression." It is sufficient to observe that a relevant statutory purpose of s 471.12 is the prevention of offensive uses of postal and similar services. That purpose does not aid in the construction of s 471.12 as it is a purpose derived from the text itself. It can only be given content by the construction of the section 38 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 226 [16], Lord Millett agreeing at 241 [82]. 39 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 226 [16], Lord Millett agreeing at 241 [82]. 40 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 239 41 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 252 42 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 252 [123]. The term was used in Chassagnou v France (1999) 29 EHRR 615 at 687 [113] as a justification for interference with the enjoyment of a Convention right in order to protect rights or freedoms not enumerated in the Convention. 43 Cram, "The Danish Cartoons, Offensive Expression, and Democratic Legitimacy", in Hare and Weinstein (eds), Extreme Speech and Democracy, (2009) 311 at 320. applying other criteria. Criteria relevant in this case are that the provision attaches a criminal sanction to an offensive use of postal or similar services and that such uses may include the content of a communication thereby affecting freedom of expression. The criminal sanction and the application of the principle of legality both indicate a requirement for a high threshold to be surmounted before the content of a communication made using a postal or similar service can be characterised as "offensive". A useful definition of any larger statutory purpose based upon common attributes of or significance to be attached to "postal or similar services" is elusive. The District Court decision In the District Court Tupman DCJ construed the term "offensive" as meaning "something that would be likely to wound (as opposed to merely hurt) the feelings, arouse anger or resentment or disgust or outrage in the mind of a reasonable person in all of the circumstances." Her Honour rejected a submission that it should be construed as including "repugnant in a moral sense". Tupman DCJ accepted that even on her construction of the term "offensive" s 471.12 could cover "legitimate political or governmental discourse or communication". Her Honour held that the purposes of the provision are: To protect the "integrity of the post both physically and as a means of communication in which the public can have confidence"; To prevent breaches of the peace which might arise out of the receipt of an offensive communication; To prevent harm in the nature of wounded feelings, anger, resentment, disgust or outrage on the part of the recipient. Her Honour concluded that s 471.12 is reasonably appropriate and adapted to serve legitimate legislative ends and that it does so in a manner compatible with the maintenance of the system of government prescribed by the Constitution. The provision thus met the criteria for validity enunciated by this Court in Lange v Australian Broadcasting Corporation44 and the challenge to its validity failed. The decision of the Court of Criminal Appeal There were three separate sets of reasons for judgment in the Court of Criminal Appeal. Bathurst CJ held that for the use of a postal service to be offensive within s 471.12 it had to be "calculated or likely to arouse significant 44 (1997) 189 CLR 520; [1997] HCA 25. anger, significant resentment, outrage, disgust, or hatred in the mind of a reasonable person in all the circumstances."45 It would not be sufficient if the use would only hurt or wound the feelings of the recipient in the mind of a reasonable person46. Allsop P adopted the same limiting construction47 and in the alternative proposed a further requirement, not adopted by Bathurst CJ, that the conduct must be such as to cause "real emotional or mental harm, distress or anguish" to the addressee48. That alternative, directed to the infliction of harm on the recipients of offensive communications, involved, with respect, an unjustifiable gloss on the meaning of "offensive". McClellan CJ at CL took a more open-textured approach, holding that49: "The section will only be breached if reasonable persons, being persons who are mindful of the robust nature of political debate in Australia and who have considered the accepted boundaries of that debate, would conclude that the particular use of the postal service is offensive." Bathurst CJ and Allsop P correctly held that s 471.12 effectively burdened freedom of communication about government and political matters50. As Allsop P observed51: "Some political communications may, by their very nature, be objectively calculated or likely to cause or arouse significant anger, significant resentment, outrage, disgust or hatred." McClellan CJ at CL, although not expressly stating that he did so, appears to have reached a similar conclusion52. Bathurst CJ identified the legislative purposes of s 471.12 as including the protection of persons from being subjected to material that is "offensive" in the 45 (2011) 256 FLR 28 at 39 [44]. 46 (2011) 256 FLR 28 at 39 [44]. 47 (2011) 256 FLR 28 at 48 [83]. 48 (2011) 256 FLR 28 at 50 [89]. 49 (2011) 256 FLR 28 at 54–55 [118]. 50 (2011) 256 FLR 28 at 42 [56] per Bathurst CJ, 48–49 [84]–[85] per Allsop P. 51 (2011) 256 FLR 28 at 48 [84]. 52 (2011) 256 FLR 28 at 53 [108]. sense in which his Honour had construed that term. His Honour inferred that the legislature considered such protection necessary having regard to the features of a postal service including: That the post is generally sent to a person's home or business address and therefore personalised; That material sent by post is often unable to be avoided in the ordinary course of things53. Allsop P accepted a submission that the purpose of the provision was to protect "the integrity of the post"54. His Honour said55: "It is legitimate in the maintenance of an orderly, peaceful, civil and culturally diverse society such as Australia that services that bring communications into the homes and offices of people should not be such as to undermine or threaten a legitimate sense of safety or security of domain, and thus public confidence in such services." McClellan CJ at CL did not expressly identify the purpose of the provision. Each of the members of the Court of Criminal Appeal held that s 471.12, in its application to offensive uses of a postal service, was reasonably appropriate and adapted to serve a legitimate end in a manner compatible with the maintenance of the system of government prescribed by the Constitution56 and was valid. Their Honours placed some emphasis upon the use of postal and similar services to deliver letters and articles to "homes and offices". Their emphasis was reflected in the Commonwealth Attorney-General's submission to this Court that the purpose of s 471.12 is to prevent "the misuse of postal services to effect unwanted and undesirable intrusions into private spaces, so as to preserve public confidence in the use of those services." That approach echoes the observation by the Supreme Court of the United States in Rowan v Post Office Department57 that: 53 (2011) 256 FLR 28 at 42–43 [59]. 54 (2011) 256 FLR 28 at 46 [78]. 55 (2011) 256 FLR 28 at 46 [78]. 56 (2011) 256 FLR 28 at 44 [67] per Bathurst CJ, 50 [91] per Allsop P, 55 [119] per 57 397 US 728 at 737 (1970). "The ancient concept that 'a man's home is his castle …' has lost none of its vitality, and none of the recognized exceptions includes any right to communicate offensively with another." legislation under which In that case the Supreme Court upheld the validity, against a First Amendment challenge, of "pandering advertisement[s]"58 could request the Postmaster-General to direct the sender to refrain from further postings to that address. A shadow of that approach may also be seen in the observation made in the majority opinion in United States Postal Service v Council of Greenburgh Civic Associations59 that: recipient of "There characterization of a letterbox as a public forum." is neither historical nor constitutional support for the What might seem to be a trite common law analogue of that proposition appears in the observation of Stamp LJ in Hubbard v Pitt60: "Judges may ardently believe in the liberty to speak, the liberty to assemble and the liberty to protest or communicate information: but the necessity to preserve these liberties would not constrain the court to refuse a plaintiff an injunction to prevent defendants exercising those liberties in his front garden." The analogy breaks down to the extent that it posits an exercise of the liberty which infringes the legal rights of a third party61. A closer analogy may be found in the reasoning involving the "rights of others" and "indisputable imperatives" mentioned in Connolly and ProLife. Reference to United States authority must have regard to the particular history of postal services in that country as a means of political communication of such importance that postal services policy and legislation is said to have shaped First Amendment doctrine62. That is not to deny the historical 58 397 US 728 at 728 (1970). 59 453 US 114 at 128 (1981). 60 [1976] 1 QB 142 at 187. 61 In that case an interlocutory injunction was upheld to restrain protesters picketing the premises of a real estate agent, there being a serious issue to be tried whether the defendants were committing the tort of private nuisance. 62 Desai, "The Transformation of Statutes into Constitutional Law: How Early Post Office Policy Shaped Modern First Amendment Doctrine", (2007) 58 Hastings (Footnote continues on next page) importance, in Australia, of the post as a mechanism of political communication. In Bradley v The Commonwealth63, Barwick CJ and Gibbs J described postal and telephone services as "among the most important amenities available to the people of the Commonwealth" and as "essential to the conduct of trade and commerce as well as to the enjoyment of any real freedom in the dissemination of information and opinion."64 Their Honours added that it was legitimate to have regard to those considerations when interpreting the Post and Telegraph Act 1901 (Cth)65. The interpretive task in these appeals makes reference to those considerations not only legitimate but necessary. Bradley supports a restrictive construction of the constraint imposed by the term "offensive" in s 471.12. Such an approach accords with and does not exceed the principle of legality requiring a construction, if it be available, that would minimise the incursion of the statutory prohibition into the common law freedom of speech and expression. On the other hand, what was said in Bradley would not support a restrictive interpretation of laws enacted to prevent disruption to, or interference with, postal and other services as a medium of communication or their use for criminal purposes. However, what was said in that case does not lead to the identification of a mischief particularly relevant to postal and similar services, to which the impugned part of s 471.12 is directed. The Court of Criminal Appeal's formulation of the legitimate ends served by s 471.12 in its application to offensive conduct invites scrutiny because of the very wide definition of postal and similar services in s 470.1 and the range of uses of such services which might be characterised as "offensive". Because of the definition of "postal or similar service" the scope of the prohibition extends well beyond cases involving the delivery of letters and parcels to homes and businesses through publicly owned or regulated postal services. For that reason formulations of the purposes served by s 471.12 beyond prevention of the conduct which it prohibits are of limited utility. General statements about "protection of the integrity of the post" or protection against delivery of unwanted and unavoidable communications to home or office do not adequately explain the scope of the offence. There is nothing in the section which would necessarily exclude the characterisation as "offensive" of communications sent to persons who are pleased to receive them. The sending by a racist organisation of Law Journal 671; see also Ammori, "First Amendment Architecture", (2012) Wisconsin Law Review 1 at 37–38. 63 (1973) 128 CLR 557; [1973] HCA 34. 64 (1973) 128 CLR 557 at 566. 65 The interpretive task in that case concerned the power of the Postmaster-General to deprive any person of the liberty to use the postal and telephonic services. "hate literature" to members or sympathisers could, depending upon its content, fall within the section. If that possibility is open so are many others. Grounds of appeal and contentions took issue with The appellants the Court of Criminal Appeal's construction of s 471.12 and particularly of the term "offensive". Each also asserted that the Court of Criminal Appeal ought to have found that s 471.12 infringed the implied freedom of political communication. The first respondent filed a notice of contention in each appeal asserting that the Court of Criminal Appeal erred in holding that s 471.12 effectively burdened the implied freedom of communication about government or political matters. Before turning to the construction of s 471.12 it is useful to consider its legislative antecedents and history. Postal services offences—legislative antecedents The provision by government of postal services available to the general public dates back, in England, to 1635 in the reign of Charles I, when the Royal Mail was made available for that purpose. Imperial legislation in the reign of Queen Anne66 created the office of Postmaster-General for the United Kingdom and provided for that official to establish post offices in the colonies. The first postal legislation in the Colony of New South Wales was the Postage Act 1825 (NSW)67. It was a temporary measure to provide for the posting and conveyance of letters until a post office was established under the Postage Act 1835 (NSW)68. The New South Wales Government took control of postal services from private entrepreneurs who had been vice-regal appointees. Nevertheless, various functions of the postal service were contracted out69. Postal services developed in each of the colonies. By the end of the 19th century colonial postal services were established throughout the Australian continent and were supported by an array of statutes. Those statutes included offence-creating 66 Post Office (Revenues) Act 1710 (9 Anne c 11). 67 6 Geo IV No 23. 68 5 Gul IV No 24. 69 Lee, Linking a Nation: Australia's Transport and Communications 1788–1970, (2003), Ch 7; available at <http://www.environment.gov.au/heritage/ahc/ publications/commission/books/linking-a-nation/chapter-7.html>. provisions relating to the posting of letters bearing or containing indecent or obscene, profane or libellous publications70. In the Australasian Convention Debates at Adelaide in 1897, there was some discussion about whether the Commonwealth Parliament should have legislative responsibility for both postal and telegraphic services71. However, the national significance of those services never seems to have been in doubt72. A proposal to limit federal power to postal and telegraphic services outside the boundaries of the Commonwealth73 was unsuccessful. The example of the United States Constitution was invoked against objections that postal services should remain in the hands of State governments. Alfred Deakin said74: "If there has been one great federal success it has been the American post office". Postal services were properly seen as a species of national communications infrastructure. A power was conferred upon the Commonwealth Parliament by s 51(v) of the Constitution to make laws with respect to: 70 Postage Acts Amendment Act 1893 (NSW), s 18; Post Office Act 1890 (Vic), s 118; Post Office Act 1876 (SA), s 91; Post and Telegraph Act 1891 (Q), s 98; Post and Telegraph Act 1893 (WA), s 86; Post Office Act 1881 (Tas), s 107. 71 Official Record of the Debates of the Australasian Federal Convention, (Adelaide), 25 March 1897 at 114; 29 March 1897 at 233–234, 252; 30 March 1897 at 266– 267, 318–319, 327–328; 31 March 1897 at 376; 17 April 1897 at 769–774; 22 September 1897 at 1068–1069. 72 The national character of postal and telegraphic services was foreshadowed long before Federation. Earl Grey's Privy Council Committee in 1849 designated the "conveyance of letters" as a matter of federal power. In 1853 Wentworth's Constitutional Committee identified "postage between the said colonies" as a matter of federal responsibility. His Memorial in 1857 conferred on a proposed Federal Assembly legislative power with respect to "intercolonial telegraphs and postage". Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 85, 91 and 94. 73 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 74 Official Record of the Debates of the Australasian Federal Convention, (Adelaide), 17 April 1897 at 770. "postal, telegraphic, telephonic, and other like services". The Commonwealth was also given exclusive power under s 52(ii) of the Constitution to make laws with respect to: "matters relating to any department of the public service the control of which is by this Constitution transferred to the Executive Government of the Commonwealth". Section 69 of the Constitution provides that on a date or dates to be proclaimed by the Governor-General after the establishment of the Commonwealth, specified departments of the public service in each State should be transferred to the Commonwealth. One of the departments so specified was "posts, telegraphs, and telephones". The proclaimed date for the transfer of those departments was 1 March 1901. The first Commonwealth legislation relating to postal services was the Post and Telegraph Act 1901. That Act provided, in s 107(c), that it was an offence to send by post any postal article which: "has thereon or therein or on the envelope or cover thereof any words marks or designs of an indecent obscene blasphemous libellous or grossly offensive character". That provision was based upon s 98 of the Post and Telegraph Act 1891 (Q), which was in turn based upon s 4(1) of the Post Office (Protection) Act 1884 (UK). Section 4(1) prohibited, inter alia, the sending of a postal packet which enclosed "any indecent or obscene" article or had "on such packet, or on the cover thereof, any words, marks, or designs of an indecent, obscene, or grossly offensive character." The scope of the term "grossly offensive" was discussed in the Committee debate on the 1884 Bill in the House of Commons. A concern was expressed that the provision could pick up something that "did nothing more than lacerate the feelings of the person receiving it."75 That concern was met by the assertion that any tribunal would understand "grossly offensive" as "not offensive to a particular person, but offensive to public morality"76. Reference to the Committee debate in 1884 supports the conclusion available from the text of s 107(c) that the epithet "grossly" conveyed an instruction to courts that criminal liability was confined to conduct in the higher 75 United Kingdom, House of Commons Debates, 9 August 1884, vol 292, cc370– 76 United Kingdom, House of Commons Debates, 9 August 1884, vol 292, cc371– ranges of offensiveness. The Full Court of the Supreme Court of South Australia in Romeyko v Samuels77 construed "grossly offensive" in s 107(c) as "offensive to a very substantial degree."78 The application of both the statutory expression and its judicial translation required an evaluative judgment by the Court. Such judgments are sometimes informed by a policy or purpose attributable to the statute in which the relevant provision appears. Where no such purpose can be formulated the evaluative judgment will be informed by the construction of the provision. Romeyko v Samuels may be regarded as an example of such a case. No purposive aspect of s 107(c) particular to postal or telegraphic services was identified in that case as relevant to the application of the term "grossly offensive". In the present appeals the purpose of s 471.12 was said to be illuminated by its history and antecedents. The Post and Telegraph Act 1901 was repealed in 197579 and replaced by the Postal Services Act 1975 (Cth)80. The Act contained no equivalent to s 107(c) of the Post and Telegraph Act 1901; however, it did provide in s 116 that regulations could be made for the specific purpose of prohibiting, restricting, regulating or imposing conditions with respect to the sending by post or by courier service of articles that are indecent, obscene or offensive or contained material of this nature. Regulation 53A of the Postal Services Regulations, made under that Act in 1982, prohibited the sending by postal service of an article containing "matter not solicited by the person to whom it is sent, being matter of an indecent, obscene or offensive nature"81. The Australian Postal Commission was incorporated as the Australian Postal Corporation in 198982 and was continued in operation by the Australian Postal Corporation Act 1989 (Cth)83. Section 85S of the Crimes Act 1914 (Cth) ("the Crimes Act"), the most direct textual precursor of s 471.12, was enacted in 77 (1972) 2 SASR 529. 78 (1972) 2 SASR 529 at 566 per Bray CJ, Bright and Sangster JJ agreeing at 567. 79 Postal and Telecommunications Commissions (Transitional Provisions) Act 1975 (Cth), s 4, Sched 1. 80 Enacted following the completion of the Report of the Commission of Inquiry into the Australian Post Office, (1974). 81 Postal Services Regulations (Amendment) 1982. 82 Postal Services Amendment Act 1988 (Cth), s 5; Commonwealth of Australia Gazette, S402, 20 December 1988. 83 Australian Postal Corporation Act 1989 (Cth), ss 12, 13. 198984. That section replicated the offences previously set out in the Postal Services Regulations. Section 85S provided: "A person shall not knowingly or recklessly: use a postal … service supplied by Australia Post to menace or harass another person; or use a postal … service supplied by Australia Post in such a way as would be regarded by reasonable persons as being, in all the circumstances, offensive." There were amendments to the text and section numbering in 1997 and 2001 but the phrase "in such a way as would be regarded by reasonable persons as being, in all the circumstances, offensive" remained unchanged. The text of s 85S was drawn in part from s 86 of the Telecommunications Act 1975 (Cth). That section prohibited the use of a telecommunications service for the purpose of menacing or harassing another person. It also prohibited the sending over a telecommunications system of a communication or information "likely to cause reasonable persons, justifiably in all the circumstances, to be seriously alarmed or seriously affronted." The Explanatory Memorandum relevant to s 85S included a statement that the opportunity had been taken to treat Australia Post and the telecommunications carriers consistently85. That statement suggested that the level of offensiveness contemplated by s 85S was consistent with serious affront. In 2002, s 85S of the Crimes Act was repealed and replaced by the first version of s 471.12 of the Code. That section was in the same terms as the present s 471.12 save that it did not contain the words in parentheses in s 471.12(b) and used the passive voice "would be regarded by reasonable persons" instead of the active voice "reasonable persons would regard as being" used in the present version of the section. The Explanatory Memorandum for the Criminal Code Amendment (Anti- hoax and Other Measures) Bill 2002, which enacted s 471.12 in its original form, observed that the new offence drew on the existing offence in s 85S of the 84 Telecommunications and Postal Services Consequential Amendments) Act 1989 (Cth), s 5. (Transitional Provisions and 85 Telecommunications and Postal Services Consequential Amendments) Bill 1989, Explanatory Memorandum at 3. (Transitional Provisions and Crimes Act but broadened its scope with respect to menacing and harassing material86. The Explanatory Memorandum further stated: "In practice, the offence would cover material that would make a person apprehensive as to his or her safety or well-being or the safety of his or her property as well as material containing offensive or abusive language or derogatory religious, racial or sexual connotations." In the Second Reading Speech for the Bill in the Senate, the Minister observed that87: "Protecting the safety, security and integrity of Australia's information infrastructure, including postal and courier services, is a priority for this Government. The measures contained in this bill will ensure that these important communication services are not compromised by irresponsible, malicious or destructive behaviour." The appellant Ms Droudis submitted that s 85S marked the advent of a concept of offence that covered a broader range of conduct than that covered by the Postal Services Regulations. That broad coverage was said to have been continued in s 471.12 and could include the use of a postal service inducing anger, resentment, outrage, disgust or hatred. It was broader than the concepts of "alarm" or "affront" in s 86(c) of the Telecommunications Act 1975. It did not take its colour from the words "menacing" or "harassing". Menacing conduct can be offensive. So too can harassing conduct. They offer no logical basis for preferring one construction of "offensive" over another. In this case the legislative history supports the following conclusions: The term "offensive" in s 471.12 has an ancestry traceable to the Post Office (Protection) Act 1884 (UK); The textual setting in which the term "offensive" has been used in successive statutes and regulations relating to postal services has changed from time to time; The scope of the offence created by s 471.12, in its application to offensive conduct, does not reflect the culmination of a logical 86 Criminal Code Amendment (Anti-hoax and Other Measures) Bill 2002, Explanatory Memorandum at 7. 87 Australia, Senate, Parliamentary Debates (Hansard), 11 March 2002 at 440. progression of regulation or what metaphorically a "regulatory trajectory"; the Commonwealth called It is not a purpose of the term "offensive" in s 471.12 to proscribe uses of postal or similar services which convey insults or slights or which are likely to engender hurt feelings; As a corollary of the preceding conclusion it is not a purpose of the offence created by s 471.12 communications which use postal or similar services; to secure civility or courtesy The meanings of "offensive" as used in s 471.12 are in the higher ranges of seriousness. Offensive to reasonable persons The requirement that the prohibited use of a postal or similar service be one "that reasonable persons would regard as being, in all the circumstances, … offensive" imports an objective but qualitative criterion of criminal liability. Similar criteria have been judicially applied to "offensive conduct" in public order statutes notwithstanding the absence of express words of the kind found in s 471.1288. The characteristics of the reasonable person, judicially constructed for the purpose of such statutory criteria, have been variously described. A "reasonable man" tolerant and understanding, and reasonably contemporary in his reactions." A reasonable person was said, in the Supreme Court of New South Wales, to be "neither a social anarchist, nor a social cynic"90. The reasonable person is a constructed proxy for the judge or jury. Like the hypothetical reasonable person who is consulted on questions of apparent bias91, the construct is intended to remind the judge or the jury of the need to view the circumstances of allegedly offensive conduct through objective eyes and to put to one side subjective reactions which in Ball v McIntyre89 was "reasonably 88 Worcester v Smith [1951] VLR 316 at 318 per O'Bryan J; Inglis v Fish [1961] VR 607 at 611 per Pape J; Ball v McIntyre (1966) 9 FLR 237 at 242–243 per Kerr J. 89 (1966) 9 FLR 237 at 245 per Kerr J; see also the recent decision of the Supreme Court of New Zealand in Morse v Police [2012] 2 NZLR 1 at 19 [38] per Elias CJ, 33 [98] per McGrath J. 90 Spence v Loguch unreported, Supreme Court of New South Wales, 12 November 1991 at 11 per Sully J. 91 See for example, Johnson v Johnson (2000) 201 CLR 488 at 493 [12] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ; [2000] HCA 48. may be related to specific individual attitudes or sensitivities. That, however, is easier said than done. The "reasonable persons" test in s 471.12 does not specify the assumptions upon which it is to be applied. One assumption might be that the reasonable persons referred to in the section have bare knowledge of the allegedly offending use of a postal or similar service and its attendant circumstances but that it is a use not directed to them and not otherwise affecting them. An alternative assumption is that the reasonable persons are affected by the allegedly offensive use. In the present case that would require the assumption that the reasonable persons are the parents of recently deceased servicemen or women in receipt of the letters the subject of the indictment. The reasons for judgment of Bathurst CJ and Allsop P in the Court of Criminal Appeal posited an emotional reaction by the hypothetical reasonable persons but did not explain its origin92. The assumed perspective of the reasonable persons referred to in s 471.12 was not explored in these appeals. The more conservative assumption may be that of a reasonable person who knows of the allegedly offensive use and its attendant circumstances rather than that of a person to whom the allegedly offensive use is directed. In the event, for reasons that follow, it makes no difference to the outcome of these appeals. A further question about the application of the reasonable persons test as formulated in the Court of Criminal Appeal arises from the need to show that such persons would react to the allegedly offensive use with significant anger, resentment, outrage, disgust or hatred. Such reactions are not to be explained as the outcome of a process of reasoning. They would involve the assumption, by the tribunal of fact, of some deeply and widely held values or attitudes with emotional content by which the allegedly offensive conduct is to be judged and which are discerned by the tribunal of fact as those of reasonable persons. Whether or not located in the eye of a reasonable beholder and whether or not narrowly defined, offensiveness is a protean concept which is not readily contained unless limited by a clear statutory purpose and other criteria of liability. It would be useful to be able to identify a purposive framework, beyond that provided by s 471.12 itself, in which to apply the criterion of liability which it creates. The Commonwealth's submission invoked numinous concepts of "unwanted and undesirable intrusions into private spaces" and the preservation of 92 (2011) 256 FLR 28 at 39 [44] per Bathurst CJ, Allsop P agreeing at 45 [70]. The perspective from which conduct or language is to be regarded as "offensive" raises difficult issues discussed by the late Professor Joel Feinberg in relation to what he called "profound offense": Feinberg, Offense to Others, (1985), Ch 9. "public confidence" in the use of postal and similar services. Those terms and the invocation of the "integrity of the postal service" have a rhetorical ring about them. The latter term was used in the Second Reading Speech. They do not, however, provide a basis for a workable constraint upon the application of the criterion of offensiveness in s 471.12. Nor, as appears below, do they define with sufficient concreteness a "legitimate end" of the prohibition relevant to the freedom of political imposes upon question whether any burden communication is permissible under the Constitution. Public order offences relating to disorderly, insulting or offensive behaviour or language have purposes related to the regulation of conduct in or near public places. However, it is unwise to generalise about them. In a statute creating such an offence there is a close relationship between its construction and its purpose. Depending upon whether a low threshold or high threshold construction of the criterion of liability is adopted the prohibition may be directed to maintaining "decorum" in public places93, upholding community standards and reasonable expectations of the community94 or preventing conduct productive or likely to be productive of public disorder95. Different constructions and correspondingly different formulations of the statutory purpose of s 7(1)(d) of the Vagrants, Gaming and Other Offences Act 1931 (Q), in its application to insulting words in or near a public place, were apparent in the judgments in Coleman v Power96. Gleeson CJ held that "insulting words" extended to the use of language which in the circumstances was "contrary to contemporary standards of public good order, and goes beyond what, by those standards, is simply an exercise of freedom to express opinions on controversial issues."97 That construction of the prohibition also defined its purpose, which the "the preservation of order in public places in the interests of the amenity and security of citizens, and so that they may exercise, without undue disturbance, the rights and freedoms involved in the use and enjoyment of such places." 93 Campbell v Samuels (1980) 23 SASR 389 at 391 per Zelling J. 94 Khan v Bazeley (1986) 40 SASR 481 at 486 per O'Loughlin J. 95 Morse v Police [2012] 2 NZLR 1. 96 (2004) 220 CLR 1; [2004] HCA 39. 97 (2004) 220 CLR 1 at 26 [14]. 98 (2004) 220 CLR 1 at 32 [32]. McHugh J construed the words according to their broad ordinary meaning. He did not separately identify a statutory purpose but ultimately rejected the propounded legitimate end of the prohibition, namely avoiding breaches of the peace and removing threats and insults from areas of public discussion, as a justification for the burden imposed by the prohibition on the freedom of political communication99. Gummow and Hayne JJ construed "insulting words" in context as words which, in the circumstances in which they were used, were provocative in the sense that they were intended or reasonably likely to provoke unlawful physical retaliation from the person to whom they were directed or some other person who heard the words uttered100. The provision was "not directed simply to regulating the way in which people speak in public"101 but something more. Kirby J took a similar approach102 and observed103: "It has always been a legitimate function of government to prevent and punish behaviour of such kind." Callinan and Heydon JJ, like Gleeson CJ, took a broader view of the prohibition. Callinan J held that the legislation was intended to prohibit language that was "incompatible with civilised discourse and passage"104. Heydon J also held that the term "insulting words" should be given its natural and ordinary meaning, not limited to words intended to provoke an unlawful physical retaliation105. As appears from the preceding, and from the other cases mentioned, the identification of the purpose of a particular provision of a statute cannot always precede its construction. Against that background it is necessary to focus more closely upon the text of s 471.12. 99 (2004) 220 CLR 1 at 54 [103]. 100 (2004) 220 CLR 1 at 74 [183]. 101 (2004) 220 CLR 1 at 76 [191]. 102 (2004) 220 CLR 1 at 98 [254]. 103 (2004) 220 CLR 1 at 99 [256]. 104 (2004) 220 CLR 1 at 108 [287]. 105 (2004) 220 CLR 1 at 117 [310]. The construction of s 471.12—text and context Section 471.12 is concerned with the use of a "postal or similar service". The breadth of that term as defined in s 470.1 has already been pointed out. It is broader than "postal … and other like services" within the meaning of s 51(v) of the Constitution. The present appeals are concerned with the application of the section to the content of communications said to be made using a postal or similar service as defined. The ordinary meaning of the word "offensive" unconstrained by epithets such as "grossly" is: Causing offence or displeasure; Irritating, highly annoying; Repugnant to the moral sense, good taste or the like, insulting106. The New Shorter Oxford English Dictionary also adds the terms "disgusting" and "nauseous"107. Within the bounds of its ordinary meaning the term "offensive" used objectively, as it is in s 471.12, covers a range of imputed reactions by one person to the conduct of another. It may describe conduct which would cause transient displeasure or irritation and also conduct which would engender much more intense responses. In the Court of Criminal Appeal Bathurst CJ and Allsop P, as discussed earlier in these reasons, construed it as confined to conduct at a threshold defined by the words "calculated or likely to arouse significant anger, significant resentment, outrage, disgust, or hatred in the mind of a reasonable person in all the circumstances."108 On the construction of "offensive" adopted by the Court of Criminal Appeal, conduct which a reasonable person would regard in all the circumstances as offensive within the ordinary meaning of that term would not necessarily be offensive for the purposes of s 471.12. There is no novelty in that approach. Kerr J in Ball v McIntyre109 referred to conduct which was hurtful or blameworthy or improper but not "offensive" within the meaning of s 17(d) of 106 Macquarie Dictionary, rev 3rd ed (2001) at 1329. 107 (1993), vol 2 at 1983. 108 (2011) 256 FLR 28 at 39 [44] per Bathurst CJ, 48 [81]–[83] per Allsop P. 109 (1966) 9 FLR 237 at 241. the Police Offences Ordinance 1930–1961 (ACT)110. The construction adopted by Bathurst CJ and Allsop P in this case set a higher threshold even than that adopted in Ball v McIntyre, which had followed the formulation by O'Bryan J in Worcester v Smith111. In the latter case, which concerned the offence of behaving in an "offensive manner" in a public place contrary to s 25 of the Police Offences Act 1928 (Vic), O'Bryan J said112: "Behaviour, to be 'offensive' within the meaning of that section, must, in my opinion, be such as is calculated to wound the feelings, arouse anger or resentment or disgust or outrage in the mind of a reasonable person." The approach of the Court of Criminal Appeal to the construction of s 471.12, in its application to offensive conduct, was orthodox. The level of offensiveness defined by the Court accorded with the principle of legality in its application to freedom of expression. It accorded with the need to construe a criterion of serious criminal liability relatively narrowly and clearly where the narrow construction was reasonably open113. It also accorded with the observations made in Bradley concerning the importance of postal and other services to freedom in the dissemination of information and opinion. In my respectful opinion however, the formulation of the purposes of the provision, expressed in largely metaphorical terms by reference to its application to postal and similar services, was not of assistance in the construction or application of s 471.12 nor in the resolution of the constitutional question. That question, which now falls for determination, is whether s 471.12, construed as the Court of Criminal Appeal construed it, in its application to offensive uses of postal or similar services, impermissibly burdens the freedom of political communication protected by the Constitution. 110 The definition of offensive adopted by Kerr J was followed in subsequent cases including Spence v Loguch unreported, Supreme Court of New South Wales, 12 November 1991 per Sully J; Conners v Craigie unreported, Supreme Court of New South Wales, 5 July 1993 per McInerney J. 111 [1951] VLR 316. 112 [1951] VLR 316 at 318; in that case the defendant had deployed banners outside the United States Consulate in Melbourne protesting against the United States military involvement in Korea among other things. The conviction was set aside on the basis that disagreement with a political policy supported by a majority of the community was not offensive within the meaning of s 25. 113 See Coleman v Power (2004) 220 CLR 1 at 75 [185] per Gummow and Hayne JJ. The validity of s 471.12 Freedom of speech is a common law freedom. It embraces freedom of communication concerning government and political matters. The common law has always attached a high value to the freedom and particularly in relation to the expression of concerns about government or political matters114. Lord Coleridge CJ in 1891 described what he called the right of free speech as "one which it is for the public interest that individuals should possess, and, indeed, that they should exercise without impediment, so long as no wrongful act is done"115. The common law and the freedoms it encompasses have a constitutional dimension. It has been referred to in this Court as "the ultimate constitutional foundation in Australia"116. TRS Allan wrote of the "traditional civil and political liberties, like liberty of the person and freedom of speech"117 and said118: "The common law, then, has its own set of constitutional rights, even if these are not formally entrenched against legislative repeal." The term "implied freedom of communication concerning government and political matters" has been well established in Australian constitutional discourse since the implication was first posited in Nationwide News Pty Ltd v Wills119 and 114 Attorney-General (SA) v Corporation of the City of Adelaide [2013] HCA 3 at 115 Bonnard v Perryman [1891] 2 Ch 269 at 284. 116 Wik Peoples v Queensland (1996) 187 CLR 1 at 182 per Gummow J; [1996] HCA 40. 117 Allan, "The Common Law as Constitution: Fundamental Rights and First Principles", in Saunders (ed), Courts of Final Jurisdiction: The Mason Court in Australia, (1996) 146 at 148. 118 Allan, "The Common Law as Constitution: Fundamental Rights and First Principles", in Saunders (ed), Courts of Final Jurisdiction: The Mason Court in Australia, (1996) 146 at 148. 119 (1992) 177 CLR 1; [1992] HCA 46. in Australian Capital Television Pty Ltd v The Commonwealth120. However, as Dawson J said in Levy v Victoria121: "the freedom of communication which is protected by the Constitution is that which everyone has in the absence of laws which curtail it and that freedom does not find its origins in the Constitution at all, either expressly or by implication." That observation may be qualified to the extent that the constitutional implication also operates upon the common law122. Subject to that qualification, the Constitution imposes a restriction on the extent of legislative power to impose a burden on freedom of communication on matters of government or political concern. The now settled questions123 to be asked when a law is said to have infringed the implied limitation are: Does the law effectively burden freedom of communication about government or political matters in its terms, operation or effect? If the law effectively burdens that freedom, is the law reasonably appropriate and adapted to serve a legitimate end in a manner which is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government and the procedure prescribed by s 128 of the Constitution for submitting a proposed amendment to the Constitution to the informed decision of the people? In each case the enquiry about the impugned law is, as was submitted for the Commonwealth Attorney-General, systemic. It is not an enquiry into whether the law places a burden upon freedom to engage in the particular kind of communications in which the appellants are said to have engaged and if so whether that burden was justified. As Hayne J said in APLA Ltd v Legal Services Commissioner (NSW)124: 120 (1992) 177 CLR 106; [1992] HCA 45. 121 (1997) 189 CLR 579 at 607; [1997] HCA 31; see also at 625–626 per McHugh J, quoted in Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 246 [184] per Gummow and Hayne JJ; [2004] HCA 41; Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. 122 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. 123 Wotton v Queensland (2012) 246 CLR 1 at 15 [25] per French CJ, Gummow, Hayne, Crennan and Bell JJ; [2012] HCA 2. 124 (2005) 224 CLR 322 at 451 [381]; [2005] HCA 44. "in deciding whether the freedom has been infringed, the central question is what the impugned law does, not how an individual might want to construct a particular communication". The first of the two constitutional questions is to be asked by reference to the legal effect and operation of s 471.12 in its application to "offensive" uses of postal and similar services. The prohibition it imposes is defined by reference, inter alia, to the content of a communication made using such services. It is therefore a restriction which can directly affect content. It places in the hands of the Court, mediated by the emotional reactions of imaginary reasonable persons, a judgment as to whether the content is within or outside the prohibition. It applies without distinction to communication of ideas about government and political matters and any other communication. The first respondent submitted that s 471.12 has only an indirect effect upon political communications. The submission pointed to the distinction, recently reiterated in Hogan v Hinch125, between laws with respect to the restriction of political communications and laws with respect to some other subject matter whose effect on political communications is unrelated to their political nature126. That distinction, however, is relevant to the second question going to validity rather than the question whether the law imposes an effective burden upon the implied freedom of political communication. The plurality in Hogan v Hinch referred to the distinction after having accepted that an affirmative answer should be given to the first question127 . That is to say a law imposing a direct burden on political communication may be found more readily to fail the criterion of validity defined by the second question than a law whose effect on such communications is indirect. There is nothing in the legal operation or effect of s 471.12 on communications about government and political matters which would defeat its characterisation as an effective burden on the freedom to engage in such communications. The kinds of communications, about government and political matters, caught by s 471.12 were said by the Commonwealth Attorney-General to be "outside the accepted boundaries of Australian political debate and at the outer fringes of political discussion." The potential reach of the section was said to be significantly limited by the circumstances to which it directed attention and the 125 (2011) 243 CLR 506; [2011] HCA 4. 126 (2011) 243 CLR 506 at 555 [95] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ, citing Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 200 [40] per Gleeson CJ, citing in turn Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 169 per Deane and Toohey JJ. 127 (2011) 243 CLR 506 at 555 [95]. nature of the reasonable person test. The Attorney-General for Victoria submitted that: A reasonable person, for the purposes of s 471.12, would understand that the use of robust means of expression can be a legitimate part of political communication in Australia; As a result the statute only prohibits those uses of the postal services which the tribunal of fact considers, even after having regard to their political context, lie outside the boundaries of robust debate and are therefore "likely to arouse significant anger, significant resentment, outrage, disgust, or hatred in the mind of a reasonable person in all the circumstances". The Attorney-General for Victoria also referred to the fault element attaching to the circumstance that a communication is "offensive" and the alternative means of political communication left open by s 471.12. Similar submissions were made by the Attorney-General of Queensland and the Attorney-General for South Australia. It may be accepted that the "reasonable person" whose perspective is to be adopted in determining liability under s 471.12 would be aware of the nature of political debate inside and outside parliamentary circles in Australia. The reasonable person would also be endowed with the awareness that participants in political debate in Australia include people who are reasonable, people who are unreasonable and people who are reasonable about some things some of the time and unreasonable about other things at other times. The awareness of the reasonable person invoked under s 471.12 would also be expected to extend to the existence of participants who are civil and courteous in the expression of their views and others who are strident, insulting and offensive as well as those people who may express themselves in varying registers of civility and offensiveness according to the circumstances. These are social facts which would not escape the hypothetical reasonable person. Based on a broad imputed awareness of the nature of Australian political debate and communications, reasonable persons would accept that unreasonable, strident, hurtful and highly offensive communications fall within the range of what occurs in what is sometimes euphemistically termed "robust" debate. That does not logically preclude the conclusion that a communication within that range is also one which is likely or calculated to induce significant anger, outrage, resentment, hatred or disgust. There may be deeply and widely held community attitudes on important questions which have a government or political dimension and which may lead reasonable members of the community to react intensely to a strident challenge to such attitudes. An example might be the circulation to households and offices of a pamphlet expressing opposition to Australia's involvement in a military conflict which has widespread community support, denouncing the involvement as immoral and asserting that Australian servicemen or women who suffer injury or die in the conflict do so in an immoral and futile cause. If such a pamphlet were circulated at or about the time of the funeral of a deceased serviceman or woman its timing might be a circumstance which would intensify the anger of reasonable persons about it. Examples can be multiplied in respect of different issues of government or political concern. It cannot be said that the constraints imposed on freedom of expression by s 471.12 in its application to "offensive" communications are confined to what were described in the submissions made on behalf of the Commonwealth Attorney- General as "the outer fringes of political discussion." Further, the reaction elicited by an offensive communication may depend upon its source. If emanating from a marginal voice on the fringes of political discussion, it may not be taken seriously enough to induce an emotional reaction in any reasonable person. There are many communications, of which the internet provides more than ample evidence, from what might be described as the "lunar" elements of political discourse. Such communications may not be taken seriously enough by reasonable persons to upset anybody. Indeed it might be said that a communication, on its face offensive, is more likely to elicit significant anger, outrage, hatred or disgust if coming from a source which cannot be so readily dismissed. The question whether s 471.12 imposes a burden on the implied freedom is answered not only by consideration of the content of the communications it affects but also by the range of mechanisms for making such communications to which it applies. They include: Delivery of letters, packets and parcels by Australia Post; Delivery of letters, packets and parcels by couriers or packet or parcel carrying services which are "postal … or other like services" within the meaning of s 51(v) of the Constitution; Delivery of letters, packets and parcels by couriers or packet or parcel carrying services which are not postal or other like services. There is nothing on the face of s 471.12 to exclude from the scope of the services it covers courier or packet or parcel carrying services for the delivery of newspapers, magazines, pamphlets, brochures, books, DVDs, CDs or audiotapes to homes or offices or even to distributors of such material, particularly if the delivery service is provided by a constitutional corporation or provided in the course of interstate trade or commerce. The "postal or similar services" covered by s 471.12 extend well beyond services funded, provided or regulated by government and beyond the constitutional concept of "postal … or other like services". There are many communications, the content of which could be regarded by reasonable persons in all the circumstances as offensive, that are conveyed by postal, courier, or packet or parcel carrying services not only to identified individuals but also to large groups of people. As earlier suggested, offensive material might be circulated by subscription or otherwise to recipients whose sympathies lie with the content of that material. The Attorney-General for Victoria submitted that the "reasonable persons" test would take account of: The nature and timing of an impugned communication concerning government or political matters; Whether the communication was targeted to an individual or part of a general circulation or mailout; Whether the communication was made pursuant to a subscription; Whether the communication occurred in the context of a pending election or constitutional referendum. The submission, with respect, tended to reinforce the conclusion that the prohibition has a potentially broad application. The "reasonable persons" criterion, which is linked to imputed emotional reactions to the content of the communication, does not narrow the scope of the prohibition in its legal operation or effect. At best, assuming the criterion can be applied as proposed by the Attorney-General for Victoria, it may affect the application of the prohibition to particular circumstances. That conclusion, however, does not support a broad judgment that the prohibition does not impose an effective burden on the implied freedom. Given the scope of the criminal liability created by s 471.12 in its application to offensive uses of postal or similar services, the section must be taken to effectively burden freedom of communication about government or political matters in its operation or effect. Section 471.12 having been found to impose an effective burden upon the implied freedom of political communication, the question arises what if any legitimate end it serves. The legitimate ends enunciated in the Court of Criminal Appeal and by the respondents and interveners were various. They included the protection of persons from being subjected to offensive material, the promotion and protection of postal and similar services that bring material into homes and offices, the regulation of postal services, the protection of the integrity of such services and the protection of those who participate in the constitutionally mandated system of government. Having regard to the scope of the term "offensive" as properly construed and the range of the "postal or similar services" to which s 471.12 applies, it is not possible to define its purpose by reference to common characteristics of such services. In practical terms it is difficult, if not impossible, to distinguish the purpose of s 471.12 from that of a law which makes it an offence to send or deliver offensive communications to anyone by any means. References to the promotion or protection of postal and similar services, the integrity of the post and public confidence in the post do not define in any meaningful way a legitimate end served by s 471.12. Its purpose is properly described as the prevention of the conduct which it prohibits. That is the prevention of uses of postal or similar services which reasonable persons would regard as being, in all the circumstances, offensive. That should not be regarded as a legitimate end not least because, as explained below, its very breadth is incompatible with its implementation in a way that is consistent with the maintenance of that freedom of communication which is a necessary incident of the system of representative government prescribed by the Constitution. The second question going to the validity of s 471.12 has two limbs. The first is whether the section serves a legitimate end. The second is whether, if so, it serves that end in a manner which is compatible with the maintenance of the the constitutionally prescribed system of representative government and procedure prescribed by s 128 of the Constitution for submitting a proposed amendment to the Constitution to the informed decision of the people. In this case those two limbs collapse into one. The purpose of the prohibition imposed by s 471.12 is as broad as its application. On its proper construction it cannot be applied in such a way as to meet the compatibility requirement. As explained above, the reasonable persons test, even when applied to a high threshold definition of what is "offensive", does not prevent the application of the prohibition to communications on government or political matters in a range of circumstances the limits of which are not able to be defined with any precision and which cannot be limited to the outer fringes of political discussion. Section 471.12, in its application to the offensive content of communications made using postal or similar services, is invalid. The remaining question is whether the impugned aspect of s 471.12 can be read down to exclude its application to offensive content in communications on matters of government or political concern. The Attorneys-General for Victoria and South Australia submitted that the provision, if otherwise invalid, should be read in that way. Having regard to the nature of the allegations made in the indictment and the relief sought, there would seem to be little point in determining whether the provision can be construed as proposed. The communications complained of on their face involve matters of government or political concern. I agree with Hayne J that the substance of the orders sought by the appellants in this Court involves quashing the indictment so far as it related to the "offensive" use of a postal service. In any event the proposed reading down would face the difficulty identified by Latham CJ in Pidoto v Victoria128 that: "if a law can be reduced to validity by adopting any one or more of a number of several possible limitations, and no reason based upon the law itself can be stated for selecting one limitation rather than another, the law should be held to be invalid." In this case there appears to be more than one possible limitation open. It is, however, not necessary to determine that question. Conclusion The appeals should be allowed. I agree with the orders proposed by 128 (1943) 68 CLR 87 at 111; [1943] HCA 37. See also Re Nolan; Ex parte Young (1991) 172 CLR 460 at 485 per Brennan and Toohey JJ; [1991] HCA 29; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 61 per Brennan J; Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 339 per Brennan J; [1995] HCA 16. Hayne The facts The appellant in the first appeal ("the first appellant") allegedly sent letters (and in one case a recorded message) to relatives of several soldiers killed in action in Afghanistan and the mother of an Austrade official killed in the bombing of a hotel in Indonesia. Each communication conveyed the author's views about a controversial political matter: the deployment of the Australian In form, each communication offered Defence Force in Afghanistan. condolences to the relatives of the deceased but, in intemperate and extravagant language, each also urged the rejection of the policies which see Australian forces engaged in Afghanistan. At least some of the communications directly insulted those who had died. The prosecution of the appellants The Commonwealth Director of Public Prosecutions filed an indictment in the District Court of New South Wales charging the first appellant with 12 counts of using a postal service in a way that reasonable persons would regard as being, in all the circumstances, offensive, contrary to s 471.12 of the Criminal Code (Cth) ("the Code"). The indictment further charged the first appellant with one count of using a postal service in a way that reasonable persons would regard as being, in all the circumstances, harassing, again contrary to s 471.12 of the Code. The indictment charged the appellant in the second appeal ("the second appellant") with eight counts of aiding and abetting the first appellant in using a postal service in a way that reasonable persons would regard as being, in all the circumstances, offensive, contrary to ss 11.2(1) and 471.12 of the Code. Section 471.12 of the Code provides: "Using a postal or similar service to menace, harass or cause offence A person is guilty of an offence if: the person uses a postal or similar service; and the person does so in a way (whether by the method of use or the content of a communication, or both) that reasonable persons would regard as being, in all the circumstances, menacing, harassing or offensive. Penalty: Imprisonment for 2 years." Hayne The course of proceedings The appellants moved to quash the indictment. They alleged that s 471.12 of the Code is invalid. At first instance, Tupman DCJ dismissed129 the motion to quash. The appellants appealed to the Court of Criminal Appeal of the Supreme Court of New South Wales. In the course of the appeals, the first appellant abandoned his challenge to the validity of so much of s 471.12 as makes it an offence to use a postal service in a way that reasonable persons would regard as being harassing. Thus the only question for the Court of Criminal Appeal was whether s 471.12 is valid when it makes it a crime to use a postal service in a way that reasonable persons would regard as being offensive. The Court of Criminal Appeal (Bathurst CJ, Allsop P and McClellan CJ at CL) held that s 471.12 is valid and dismissed130 the appeals. By special leave, each appellant appealed to this Court. The issue and its resolution The issue in these appeals can be stated briefly. The Parliament of the Commonwealth has no power to make a law inconsistent with that freedom of communication on matters of government and politics which is an indispensable incident of the constitutionally prescribed system of representative and responsible government. Is a law which makes it a crime to use a postal or similar service to make a communication about government or political matters in a way that reasonable persons would regard as being, in all the circumstances, offensive beyond legislative power? For the reasons that follow, that question must be answered: "Yes". History, not only recent history, teaches that abuse and invective are an inevitable part of political discourse. Abuse and invective are designed to drive a point home by inflicting the pain of humiliation and insult. And the greater the humiliation, the greater the insult, the more effective the attack may be. The giving of really serious offence is neither incidental nor accidental. The communication is designed and intended to cause the greatest possible offence to its target no matter whether that target is a person, a group, a government or an opposition, or a particular political policy or proposal and those who propound it. And any reasonable person would conclude that not only is that the purpose of what was said, its purpose has been achieved. 129 R v Monis (2011) 12 DCLR (NSW) 266. 130 Monis v The Queen (2011) 256 FLR 28. Hayne If examples are sought, and recent Australian political history is thought too controversial, consider O'Connell's attack on Disraeli in 1835, with its references to the impenitent thief and what now are rightly seen as racial or religious slurs. Or look to Lloyd George's speech in the House of Commons about Sir John Simon acting "as if [he] has been a total abstainer all his life and has suddenly taken to drink ... and landed amidst the Tory drunkards". The examples can be multiplied. Particular attacks may be admired, others condemned. But admiration or condemnation depends not upon whether offence is given but upon the content of the views that are advanced or attacked and the identity of those associated with those views. Great care must be taken in this matter lest condemnation of the particular views said to have been advanced by the appellants, or the manner of their expression, distort the debate by obscuring the centrality and importance of the freedom of political communication, including political communications that are intended to and do cause very great offence. If s 471.12 is valid, communications of that kind cannot be reduced to writing and sent by use of a postal or similar service. To do so would be a crime because reasonable persons would consider the communication to be, in all the circumstances, seriously offensive. Yet being seriously offensive was the plain political purpose of the communication. The conclusion that s 471.12 does not validly make it a crime to use a postal or similar service to make a communication about government or political matters in a way that reasonable persons would regard as offensive is required by earlier decisions of this Court, in particular Lange v Australian Broadcasting Corporation131 and Coleman v Power132. No party or intervener sought to reopen those decisions or to submit that they should not be followed and applied. Both the principles stated in those cases and the actual decisions reached in them require the conclusion that s 471.12 is too broad in its operation with respect to offensive use of a postal or similar service. That aspect of the section is directed generally to preventing serious offence, not to some other object or end the pursuit of which would be compatible with the constitutionally prescribed system of government and the freedom of political communication which is its indispensable incident. More particularly, s 471.12 makes it a crime to send by a postal or similar service an offensive communication about a political matter even if what is said is true. It makes it a crime to send by a postal or similar service an offensive communication about a political matter that is not only offensive but defamatory, even when, applying the maintenance of 131 (1997) 189 CLR 520; [1997] HCA 25. 132 (2004) 220 CLR 1; [2004] HCA 39. Hayne Lange, the publisher would have a defence of qualified privilege to a claim for defamation. The arguments On the hearing of the appeals, arguments were advanced on behalf of each appellant, the Commonwealth Director of Public Prosecutions on behalf of the first respondent and the Attorney-General for the State of New South Wales as second respondent. In addition, separate arguments were advanced on behalf of the Attorneys-General for the Commonwealth and the States of Queensland, South Australia, Victoria and Western Australia intervening in support of the respondents pursuant to s 78A of the Judiciary Act 1903 (Cth). The arguments for invalidity of s 471.12 (in its application to "offensive" uses) advanced by the appellants were not identical and the arguments of the respondents and interveners in support of validity also differed, as between themselves, in a number of respects. It is neither necessary nor desirable to attempt to trace these differences precisely. It is, however, useful to identify immediately five principal strands in the arguments. The construction of s 471.12 The respondents and interveners generally accepted that what amounts to an "offensive" use of a postal or similar service for the purposes of s 471.12 should be understood in the manner described133 by Bathurst CJ in the Court of Criminal Appeal: the use must be calculated or likely to arouse "significant anger, significant resentment, outrage, disgust, or hatred in the mind of a reasonable person in all the circumstances". For the purposes of argument, the appellants were content to adopt the same construction but they also submitted that the better view is that "offensive", when used in s 471.12, encompasses any affront to feelings. These reasons conclude the appellants' submissions about construction should not be accepted. It is convenient to adopt the description used by Bathurst CJ as a general description of the kind and intensity of reaction that must be evoked by the relevant conduct. that A burden on the freedom of political communication? All parties and interveners accepted that s 471.12 prohibits the making of some communications about government or political matters. But the first respondent and several interveners submitted that s 471.12 does not "effectively burden" the freedom of political communication because its effect could be described as de minimis, insubstantial, slight or unrealistic. They submitted that 133 (2011) 256 FLR 28 at 39 [44]. Hayne this was a sufficient basis for concluding that s 471.12 is consistent with the freedom of political communication. These reasons conclude that s 471.12 does effectively burden the freedom of political communication. And even if it were right to describe the burden which this law imposes as only a little burden, a law imposing a little burden will only be consistent with the freedom of political communication if it is (a) directed to an object or end compatible with the maintenance of the constitutionally prescribed system of government and its necessary incident the freedom of political communication and (b) reasonably appropriate and adapted to achieving that legitimate end in a manner that is compatible with the maintenance of the constitutionally prescribed system of government and with the freedom of political communication. The object or end of the "offensive" limb of s 471.12? The parties and interveners suggested a number of possible objects or ends to which s 471.12 is directed in its operation with respect to "offensive" uses of a postal or similar service. Candidates included promoting the civility of discourse, preserving the integrity of the post, protecting mail recipients from offence, and preserving an ordered society by preventing violence. These reasons conclude that the object or end to which s 471.12 is directed must be determined by the ordinary processes of statutory construction. It follows that the object or end to which the "offensive" limb of the section is directed is preventing the use of a postal or similar service in a way that would give offence. Is the object or end legitimate? However the object or end of s 471.12 is described, the respondents and interveners submitted that the object or end was legitimate because the section does one or more of three different things: it preserves the integrity of the post, it keeps the peace by avoiding violent responses by those who are offended, and it protects mail recipients (and others) from offence. These reasons conclude that, in its legal and practical operation, the relevant part of the section protects mail recipients and others from offence. This is not a legitimate object or end. It is not compatible with the maintenance of the constitutionally prescribed system of government and its necessary incident the freedom of political communication. The section goes no further than maintaining the civility of discourse carried on by means of a postal or similar service. Section 471.12 does not protect the "integrity of the post". It makes no real or substantial contribution to keeping the peace. And it was not shown to be directed to achieving any further social good other than penalising, and so protecting against, conduct that is offensive. Hayne Reasonably appropriate and adapted to a legitimate object or end? In these appeals, the critical question is whether the object or end of s 471.12 is legitimate. These reasons conclude that it is not. Questions about the proportionality of the legislative means chosen for achieving a legitimate object or end thus do not arise. But if, as the respondents and interveners submitted and these reasons deny, s 471.12 is directed to a legitimate object or end, the respondents and interveners submitted that the section is reasonably appropriate and adapted to achieving that end in a manner that is compatible with the maintenance of the constitutionally prescribed system of government. The general thrust of the submissions was that s 471.12 is a narrowly defined offence which leaves unregulated many other ways for people to communicate about government or political matters. If a law is narrowly tailored to a legitimate object or end, the conclusion that the law is reasonably appropriate and adapted to that object or end readily follows. But these reasons conclude that, by making all seriously offensive uses of a postal or similar service an offence, including those uses where the user would have a defence of truth or of qualified privilege to a claim for defamation founded on that use, the relevant part of s 471.12 goes too far and is invalid. In order to identify the relevant content of the arguments and conclusions just described, it is necessary to state some established and unchallenged principles. Applicable principles The Constitution provides for a system of representative and responsible government. Sections 7 and 24 of the Constitution provide that the two Houses of the Parliament must be "directly chosen by the people". Section 64 requires that no Minister of State hold office "for a longer period than three months unless he is or becomes a senator or a member of the House of Representatives". Those who are elected as members of the Parliament and those who are appointed as Ministers of State are necessarily accountable to "the people" referred to in ss 7 and 24. Additionally, s 128 provides that the Constitution shall not be altered except in the manner provided in that section; in particular, only "if in a majority of the States a majority of the electors voting approve the proposed law, and if a majority of all the electors voting also approve the proposed law". As the whole Court said in Lange134, it follows from these and other provisions that "[f]reedom of communication on matters of government and politics is an 134 (1997) 189 CLR 520 at 559; see also at 557-559. Hayne indispensable incident of that system of representative government which the Constitution creates". Because freedom of communication on matters of government and politics is an indispensable incident of the constitutionally prescribed system of government, that freedom cannot be curtailed by the exercise of legislative or executive power135 and the common law cannot be inconsistent with it. But the freedom is not absolute and it follows that the limit on legislative power is also not absolute. To observe that the freedom is not absolute is not to say that it must yield to accommodate the regulation of conduct which a majority of members of the Australian community may consider to be repugnant. Nor does the observation that the freedom is rooted in implication rather than in the express text of the Constitution make it brittle or otherwise infirm, or make it some lesser or secondary form of principle. Rather, accepting that the freedom is not absolute recognises that it has boundaries. But within those boundaries the freedom limits legislative power. The accepted doctrine of the Court is that where a law has the legal or practical effect of burdening political communication, the boundaries of the freedom are marked by two conditions. In Lange, the conditions were identified136 as being first, whether the object of the impugned law "is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government or the procedure for submitting a proposed amendment to the Constitution to the informed decision of the people which the Constitution prescribes" and second, whether the impugned law "is reasonably appropriate and adapted to achieving that legitimate object or end". It was said137 that the "legitimate object or end" of the impugned law must be one "the fulfilment of which is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government and the procedure prescribed by s 128 for submitting a proposed amendment of the Constitution to the informed decision of the people". Subsequently, in Coleman v Power138 a majority of the Court reformulated the second question slightly to ask whether the impugned law achieves its 135 Lange (1997) 189 CLR 520 at 560. 136 (1997) 189 CLR 520 at 561-562. 137 (1997) 189 CLR 520 at 567 (footnote omitted). 138 (2004) 220 CLR 1 at 50-51 [92]-[96] per McHugh J, 77-78 [196] per Gummow and Hayne JJ, 82 [211] per Kirby J. Hayne legitimate object or end in a manner which is compatible with the maintenance of the system of representative and responsible government for which the Constitution provides. But, as the plurality in Wotton v Queensland recently observed139, the terms of the Lange questions are settled. No party or intervener suggested to the contrary. It is necessary to say something further about particular aspects of these accepted principles. That examination is organised under the following headings: "Effectively burden"? A "slight" or "little" burden? The submissions The flaws Reasonably appropriate and adapted? Object or end "Legitimate" object or end Not every object or end within power An ordered society and the public interest? Reasonably appropriate and adapted "Effectively burden"? In Lange, the Court said140 that a law will not be inconsistent with the freedom unless it is first found to "effectively burden freedom of communication about government or political matters either in its terms, operation or effect". If it does, attention must turn to the law's object or end and the manner in which it achieves that object or end. The use of the adverb "effectively" in the expression "effectively burden" invites attention to both the legal effect of the law in question and its practical effect. The expression "effectively burden" means nothing more complicated than that the effect of the law is to prohibit, or put some limitation on, the making or the content of political communications. 139 (2012) 246 CLR 1 at 15 [25]; [2012] HCA 2. 140 (1997) 189 CLR 520 at 567. Hayne The decided cases demonstrate that this is how "effectively burden" is to be understood. No doubt, as has been pointed out141, in many of the decided cases the parties have conceded or assumed that the law in question effectively burdens political communication. But the actual decisions in the cases can be explained only on the footing that "effectively burden" is to be understood in the way that has been described. Two examples suffice to illustrate the point. In Lange, the common law of defamation was held142 to burden the freedom of political communication. The Court identified143 the burden as holding the maker of a communication about government or political matters liable in damages or to injunctive relief. Both the question asked and its answer were straightforward: the common law of defamation effectively burdened political communication because it had the effect of limiting the making or the content of political communications by exposing the maker to civil liability. Likewise, the regulations considered in Levy v Victoria144 were found to effectively burden political communication. The regulations prevented protesters from making communications of that character. The particular regulation in issue prohibited people who did not have a valid game licence from entering permitted hunting areas between specified hours on two particular days. The burden was identified145 as precluding the plaintiff from making his political protest within those areas at those times. At this stage of the analysis, it was not to the point that communications of the same kind and content could be made in other ways. Although the principles to be applied are, in this respect, simple and straightforward, their application was central to the argument of these appeals. How and why this was so requires further explanation and consideration. 141 Wotton (2012) 246 CLR 1 at 19 [41] per Heydon J. 142 (1997) 189 CLR 520 at 568, 575. 143 (1997) 189 CLR 520 at 568. 144 (1997) 189 CLR 579; [1997] HCA 31. 145 (1997) 189 CLR 579 at 597 per Brennan CJ, 609 per Dawson J, 613-614 per Toohey and Gummow JJ, 617 per Gaudron J, 625 per McHugh J, 629, 647 per Hayne A "slight" or "little" burden? The submissions The first interveners respondent and (the Commonwealth, four Queensland, South Australia and Victoria) submitted that there are some burdens on political communication which are not sufficient to support a conclusion that the law in question "effectively burdens" political communication. The submissions used different terms to describe such burdens: "de minimis", "insubstantial", "slight" and "unrealistic". Nothing was said to turn on the choice of adjective. Each label was intended to capture, in its own way, the conclusion that the impugned law regulated so narrow or so unimportant a category of political communication that the law could not be inconsistent with the implied freedom. According to these submissions, a law which imposed a burden on political communication that warranted one of these descriptions would be consistent with the implied freedom solely on the basis that it did not "effectively burden" political communication. And because the impugned law was valid on this basis alone, no consideration need be given to either the object or end to which the law was directed or the means by which the law sought to achieve that object or end. Although the submissions which the first respondent and the interveners made differed in some respects, a common thread ran through them all. That thread had three cumulative elements. First, it was recognised that the freedom of political communication exists because it is necessary for the operation of the constitutionally prescribed system of government. Second, it was submitted that the freedom extends only so far as necessary for the operation (or perhaps preservation) of that system of government. And third, a "little" burden does not impede the effective operation or imperil the continued existence of that system. Therefore, so the argument concluded, laws imposing only a "little" burden are consistent with the implied freedom. That conclusion was embellished by assertions that there would remain a free "flow of information" and opinion; that the impugned law did not pose any "realistic threat" to the constitutionally prescribed system and the implied freedom; and that the institutions of government established by the Constitution are "strong enough not to require protection"146 from such burdens. These submissions must be rejected. They are fundamentally flawed. 146 Wotton (2012) 246 CLR 1 at 24 [54]. Hayne The flaws First, the submissions proceed from a false premise. The premise for the submissions is that the operation of the freedom is to be assessed, and its boundaries determined, by reference to whether the constitutional system of government will remain intact and still function. The submissions thus assume that the Constitution's prescription of the system of government is sufficiently detailed to allow a court to assess whether that system remains intact and functioning despite the burden on political communication. That assumption is not right. The Constitution goes no further than prescribing a system of government that has the "representative" and "responsible" characteristics fixed by its provisions, chiefly ss 7 and 24 and ss 61-67 and 69-70 respectively147. The inquiry is at best unhelpful, at worst positively misleading. The infirmity of the identified premise is further demonstrated, and the way in which its adoption may ultimately mislead is revealed, by considering the case where a burden is found not to be "little". Presumably in such a case the burden is not "little" but "significant" because it does represent a threat to the constitutional system of government. But when the bar is set so high, it is difficult to imagine, contrary to Queensland's submissions, that a burden so understood could ever be found to be reasonably appropriate and adapted to the pursuit of a legitimate object or end. Framing the first Lange question as asking whether the burden is a "little" one dictates the answer to the second Lange question and thus radically distorts the inquiry. The relevant premise is that there is a freedom of political communication, not any more general concept of the constitutional system of government, let alone some conception of how that system could or should work, or work "effectively". It is of the very first importance to recognise that the constitutional prescription of a system of representative and responsible government entails that there must be freedom of political communication. The freedom is an indispensable incident of that system of government. Whether a law burdens that freedom is not to be determined by some attempted survey of whether there is sufficient communication on government or political matters either to make the constitutional system of government work, or to make it work satisfactorily. That is too large and diffuse an inquiry. The more confined and manageable inquiry, which the cases require, is to look to the effect of the impugned law on the freedom of political communication. 147 See generally Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 57-58 per Stephen J; [1975] HCA 53; Lange (1997) 189 CLR 520 at 566-567; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 188 [6] per Gleeson CJ; [2004] HCA 41. Hayne Second, and no less fundamentally, the submissions about "little" burdens are contrary to and seek to discard the established and unchallenged doctrine of the Court. They do so by seeking to reformulate the accepted boundaries of the freedom, within which the freedom is absolute. Those boundaries are passed only when the impugned law is found to be reasonably appropriate and adapted to serve a legitimate end in a manner compatible with the constitutionally prescribed system of government and the freedom of political communication which is its indispensable incident. By these submissions the first respondent and the interveners sought to reset the boundaries to some quantitative measure. By this means the constitutional freedom would be subordinated to small and creeping legislative intrusions until some point where it could be said that there are so few avenues of communication left that the last and incremental burden is no longer to be called a "little" burden. This is not and cannot be right. The question which lies beneath the Court's doctrine in this area can be expressed as: in what circumstances can the Parliament override the freedom which "the people" must have to communicate on government or political matters? What is a "good reason" for limiting that freedom? One answer must be: when the communication is not about a government or political matter. And that is the answer the majority of the Court gave in APLA Ltd v Legal Services Commissioner (NSW)148. But is another answer to be: so long as the Parliament restricts the making or the content of political communications only a little bit? Surely not. But that is the answer proffered by the first respondent and the interveners. Third, to suggest that a law which limits political communication is valid only because there can or will be "as much" or "equivalent" political discourse (because, for example, there are other ways to make the same political point) makes one or both of two assumptions. It assumes that it is right to hold the impugned law to be within power or it consigns some restrictions on political communication to a netherworld of unimportance. Assuming the answer to the constitutional question is as wrong as it is to ignore the answer that is given to the question. The very purpose of the freedom is to permit the expression of unpopular or minority points of view. Adoption of some quantitative test inevitably leads to reference to the "mainstream" of political discourse. This in turn rapidly merges into, and becomes indistinguishable from, the identification of what is an "orthodox" view held by the "right-thinking" members of society. And if the quantity or even permitted nature of political discourse is identified by reference to what most, or most "right-thinking", members of society would consider appropriate, the voice of the minority will soon be stilled. This is not and cannot be right. 148 (2005) 224 CLR 322; [2005] HCA 44. Hayne Reasonably appropriate and adapted? Those who advanced the "little" burden submissions asserted that if, contrary to their principal submissions, it was nonetheless necessary or appropriate to consider the application of the two Lange conditions to a law imposing only a "little" burden on political communication, a law of that kind would easily meet those conditions. They submitted that s 471.12 did so. It is trite to say that the more extensive the burden on political communication the more difficult it will be to justify the impugned law149. And where a law which effectively burdens political communication is valid because it meets the two Lange conditions, it may very well be right to describe the law as imposing only a small burden on political communication. But it by no means follows that consideration of the validity of an impugned law can take a shortcut to the conclusion by use of the label "little" (or some equivalent) as a description of the burden. That sort of approach is evident in many of the submissions made in this Court. For example, South Australia submitted that the "effectiveness" of any burden "involves an evaluative exercise requiring consideration of all relevant factors". To approach the matter in this way, and to conclude that the burden is "little", may seek to replicate but serves only to mask (if not wholly ignore) all of the analytical work that is to be done in answering the second Lange question. Yet the strength of the principles established in Lange, and of proportionality reasoning more generally, is the transparency that they bring to decision-making. That transparency must not be obscured by resort to labels. Object or end Whether a statutory provision which effectively burdens political communication is consistent with the implied constitutional limitation on legislative power depends upon (a) whether the object or end which the provision pursues is legitimate and (b) whether the provision is reasonably appropriate and adapted to achieving that object or end in a manner compatible with the constitutionally prescribed system of representative and responsible government and the freedom of political communication which is its indispensable incident. Whether an impugned law serves a "legitimate object or end" first requires identification of the end or ends which the law seeks to serve. That is not a search for some subjective purpose or intention of the Parliament in enacting the impugned law. As Gummow and Bell JJ observed in Rowe v Electoral Commissioner150, whether a law infringes the constraints imposed by ss 7 and 149 See, for example, Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 143; [1992] HCA 45; Hogan v Hinch (2011) 243 CLR 506 at 555-556 [95]-[96]; [2011] HCA 4; Wotton (2012) 246 CLR 1 at 16 [30]. 150 (2010) 243 CLR 1 at 61 [166]; [2010] HCA 46. Hayne 24 of the Constitution "cannot depend upon the purpose attributed to the Parliament in enacting that measure. ... [It] cannot be answered simply by what may appear to have been legislative purpose." The end or ends that the impugned law seeks to achieve must be identified by the ordinary processes of statutory construction. In this respect, as in so many others concerned with the construction and application of statutes, "[t]he language which has actually been employed in the text of legislation is the surest guide to legislative intention"151. "Legitimate" object or end It is necessary, but not sufficient, to identify by the ordinary principles of statutory construction what end or ends the impugned law seeks to serve. It is not sufficient to do so because not every object or end pursued by a law will justify burdening the freedom of political communication. The object or end must be "legitimate". The word "legitimate" requires explanation. In Lange152, the Court said that the object or end to which the impugned law is directed must be "compatible with the maintenance of the constitutionally prescribed system of representative and responsible government or the procedure for submitting a proposed amendment to the Constitution to the informed decision of the people". It follows that to be a "legitimate" object or end, that object or end must be compatible with the constitutional system of representative and responsible government. But what it means to be "legitimate" in this context can and should be identified more precisely153. Because freedom of political communication is an indispensable incident of the constitutionally prescribed system of government, an object or end can be compatible with the system only if it is compatible with the freedom. And that is why, in Lange154, the Court said that the purpose of the law of defamation was not "incompatible with the requirement of freedom of communication imposed by the Constitution". The object or end pursued by the impugned law need not itself be the maintenance or enhancement of the system of representative and responsible government or of the freedom of political communication. But it must be compatible with them. The Constitution provides only limited guidance on the 151 Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 47 [47]; [2009] HCA 41 (footnote omitted). 152 (1997) 189 CLR 520 at 562; see also at 567. 153 See generally Rowe v Electoral Commissioner (2010) 243 CLR 1 at 139 [454], 154 (1997) 189 CLR 520 at 568 (footnote omitted). See also Levy v Victoria (1997) 189 CLR 579 at 626-627 per McHugh J. Hayne requirements of the system of government which it establishes. Legitimate ends are not expressly listed in the Constitution as they sometimes are in other jurisdictions155. In many cases it will be profitable to examine how the general law operates and has developed over time, not because the general law in any way limits or restrains the exercise of legislative power but because the implied freedom of political communication must be understood and applied having regard to what may be learned from consideration of the general law156. In most cases it will be much less useful157 to examine what is considered legitimate in other jurisdictions with their own constitutional contexts, especially where those legitimate ends are expressly identified. The decided cases show that the protection of reputation 158, the prevention of physical injury159, the prevention of violence in public places160, the maintenance of a system for the continuing supervision of some sexual offenders who have served their sentences161, "community safety and crime prevention through humane containment, supervision and rehabilitation of offenders"162, and "the imposition of conditions [a parole board] considers reasonably necessary to ensure good conduct and to stop [a] parolee committing an offence"163 are legitimate objects or ends compatible with the constitutionally prescribed system of government. These are no more than the maintenance of 155 See, for example, European Convention on Human Rights (1950), Art 10(2), which lists national security, territorial integrity or public safety, the prevention of disorder or crime, the protection of health or morals, the protection of the reputation or rights of others, preventing the disclosure of information received in confidence and maintaining the authority and impartiality of the judiciary. 156 See Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 44-45 per Brennan J, 95 per Gaudron J; [1992] HCA 46; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 216-217 per Gaudron J. 157 See Momcilovic v The Queen (2011) 245 CLR 1 at 84 [146(iii)], 87-90 [148]-[160] per Gummow J; [2011] HCA 34. 158 Lange (1997) 189 CLR 520. 159 Levy v Victoria (1997) 189 CLR 579. 160 Coleman v Power (2004) 220 CLR 1. 161 Hogan v Hinch (2011) 243 CLR 506. 162 Wotton (2012) 246 CLR 1 at 16 [31]. 163 Wotton (2012) 246 CLR 1 at 16 [32]. Hayne examples of legitimate objects or ends that have so far been identified in the cases. The list is not closed. These examples must not be taken as suggesting that any end conducive to the public interest will do. For example, to observe that the protection of personal reputation was a legitimate end in Lange and to observe that personal reputation might be thought to be a general good does not adequately support a proposition, by analogical reasoning or otherwise, that the protection of any other general good is a legitimate end. That chain of reasoning, premised as it is upon the summary statement that the legitimate end in Lange was the protection of personal reputation, overlooks the need to explain how protecting personal reputation has a connection and is compatible with the constitutionally prescribed system of government and with the freedom of political communication which is its necessary incident. Dawson J explained the connection between personal reputation and the constitutionally prescribed system of government in Theophanous v Herald & Weekly Times Ltd164: "It is hardly surprising that representative government has been thought to co-exist with defamation laws for over ninety years, even though those laws curtail freedom of speech. Indeed, the protection of reputations, even the reputations of politicians or would-be politicians, may be thought to be in the interests of representative government, because the number and quality of candidates for membership of Parliament is likely to be appreciably diminished in the absence of such protection." (footnote omitted) It is neither appropriate nor possible to identify exhaustively what are legitimate objects or ends. But it is important to identify and consider two possible views of what might qualify as a "legitimate" legislative object or end. Both views are particular manifestations of the more general proposition that any object or end that is in the public interest is a "legitimate" object or end for the purposes of applying the Court's doctrine on the implied freedom of political communication. Not every object or end within power The first respondent submitted that a legislative object or end is "legitimate" if it is an end within a legislative head of power. Queensland and South Australia each made submissions to generally similar effect. Reference was made to statements165 said to support the proposition advanced in these 164 (1994) 182 CLR 104 at 192; [1994] HCA 46. 165 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 95. See also Wotton (2012) 246 CLR 1 at 32 [83]. Hayne submissions, but the proposition has not been endorsed by a majority of the Court. It should not be adopted. In order to explain why it should not be adopted, it is useful to consider what would follow if it were. If any and every object or end that falls within any of the heads of legislative power is "legitimate", the second Lange question becomes whether the law in question is reasonably appropriate and adapted to serve the identified object or end in a manner that is compatible with the maintenance of the constitutionally prescribed system of government. Presumably the law fails this test if its detrimental impact on political communication is somehow judged to be greater than the benefit following from pursuit of the end that has been held to fall within a head of legislative power. How that comparison is to be made was not explained. On the view propounded by the first respondent, Queensland and South Australia, the only consideration that is to be given to the implied freedom is at the point of assessing the compatibility with the freedom of the legislative means that have been chosen for achieving the object or end that is within legislative power. Yet the authorities make plain that both the end and the means must be compatible with the constitutionally prescribed system and with the freedom of political communication and that compatibility means more than that the law is within a head of legislative power. As McHugh J explained in Coleman v Power166, the second Lange question involves a "compound conception". That compound conception requires consideration of both legislative means and legislative ends. It was for this reason that the majority of the Court in Coleman v Power reformulated167 the second Lange question. As originally framed, the second question could be read as suggesting that only the legislative end, and not the means of achieving that end, had to be compatible with the constitutionally prescribed system of government and with the freedom of political communication. The view urged in these appeals was that an assessment of the compatibility of the legislative object or end is concluded by finding only that the object or end falls within a head of legislative power. These submissions ignore that part of the compound conception which it has never been doubted must be considered: is the object or end to which the law is directed compatible with the maintenance of the system of representative and responsible government and the 166 (2004) 220 CLR 1 at 50 [92]. 167 (2004) 220 CLR 1 at 50-51 [92]-[96] per McHugh J, 77-78 [196] per Gummow and Hayne JJ, 82 [211] per Kirby J. Hayne freedom of political communication? This is not and cannot be right unless it be assumed that any end within power is, for that reason alone, compatible in the relevant sense. But as is explained below, that assumption is not and cannot be right. The failure to explain how a comparison could or should be made between the implied freedom and the pursuit of a legislative end which is within power (but which otherwise bears no connection with the implied freedom) is significant. On the face of it, the comparison appears to require a court to balance incommensurables: the pursuit of some object or end that is within power and the maintenance of the constitutionally prescribed system of government and the freedom that the system requires. By contrast, if the legitimacy of an object or end is understood (as it should be) as referring to the compatibility of that object or end with that system and the freedom, the second Lange question can sensibly be applied. What is then being compared is, on the one hand, the means of pursuing a legislative object or end that has been determined to be compatible with the implied freedom and, on the other, the burden on the freedom itself. There is a common point of reference. Another and no less fundamental point should be made about these submissions. The expression "reasonably appropriate and adapted", and proportionality reasoning more generally, direct attention to the relationship between one thing and another168. On the view propounded by the first respondent, Queensland and South Australia, the only relationship under consideration is the relationship between the end within power and the legislative means chosen to effect that end. Since that end may have nothing whatever to do with political communication, the law's effect on political communication may have no relevance to the relationship at all. Instead, political communication is introduced into the inquiry by a side-wind: is the means compatible with the maintenance of the constitutionally prescribed system of government and the implied freedom? If the effect on political communication is to be introduced into the inquiry in this way, a significant problem that then emerges is that the "compatibility" that is sought is not further explained. But it is clear that the inquiry is not directed to whether the law is reasonably appropriate and adapted to an end which is necessarily itself compatible with the freedom. There is, therefore, no longer any direct comparison being made between the effect of the law on one interest (an interest compatible with the constitutionally prescribed system) and another (the interest in political communication). Instead, the inquiry asks whether the law imposes "too great" a burden on the freedom, which is answered by looking only to the effects the law has on the freedom. That 168 Rowe v Electoral Commissioner (2010) 243 CLR 1 at 131 [425] per Kiefel J. Hayne becomes no more than a restatement of the "little" burden submissions examined and rejected earlier in these reasons. As already noted, the submission that any end within legislative power is a "legitimate" end might be associated with an even broader proposition. The submission may proceed from the premise that any object or end within a head of power can be assumed to be in the public interest and that any end conducive to the public interest is necessarily legitimate. This second and broader proposition requires separate consideration. An ordered society and the public interest? It may be thought that any legislative object or end is "legitimate" if it is directed to achieving an "ordered" society and not merely the curtailment of political communication. For example, reference is to be found in some of the decisions of this Court to an end being "legitimate" if it is "for the preservation of an ordered society or for the protection or vindication of the legitimate claims of individuals to live peacefully and with dignity in such a society"169. And it is common to find reference in statutory and constitutional human rights instruments to such limitations on human rights as are justifiable in a "free and democratic society"170. In general terms, it may readily be accepted that preservation of an ordered society is compatible with the constitutionally prescribed system of representative and responsible government and the freedom of political communication that is its indispensable incident. But references to an "ordered" society will mislead if they are intended to suggest that any and every end conducive to the "public interest" is compatible in the relevant sense. Like the view that any and every end within power is a "legitimate" end, this view would require the courts to balance incommensurable considerations. Even more fundamentally, the determination of what ends are "legitimate" must be made recognising that a constitutional principle is at stake. To subordinate the freedom to a law which pursues an end wholly unrelated to the freedom, even one said to be in the "public interest", would fail to recognise that the freedom is an indispensable incident of the constitutionally prescribed system of government. 169 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 77 per Deane and Toohey JJ; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 169 per Deane and Toohey JJ; Theophanous (1994) 182 CLR 104 at 179, 182 per Deane J. 170 See, for example, Charter of Human Rights and Responsibilities Act 2006 (Vic), s 7(2); Canadian Charter of Rights and Freedoms, s 1. Hayne Reasonably appropriate and adapted If a law which effectively burdens political communication pursues a legitimate end, the second Lange question asks whether the means chosen to achieve that end are reasonably appropriate and adapted to achieving it in a manner compatible with the system of representative and responsible government. This question requires the Court to make a judgment171. The judgment may be assisted by adopting the distinctive tripartite analysis that has found favour in other legal systems. On this analysis, separate consideration is given to questions of suitability, necessity and strict proportionality. But whatever structure is used for the analysis, it is necessary to consider the legal and practical effect of the impugned law. It is necessary to identify how the law curtails or burdens political communication on the one hand and how it relates to what has been identified as the law's legitimate end on the other. In undertaking that comparison it is essential to recognise that the legitimacy of the object or end of the impugned law is identified by considering the compatibility of that object or end with the system of representative and responsible government and its indispensable incident. the freedom of political communication which It bears repeating that, because "legitimate" must be understood in this way, the comparison that is to be made between the effect of the impugned law upon the freedom to communicate on government and political matters and the law's connection with an identified end proceeds from a common point of reference: the constitutionally prescribed system of government and the freedom of political communication which is its indispensable incident. The comparison to be made does not call for the balancing of incommensurables or comparing of the incomparable, as would be the case if the comparison was between the law's effect on freedom of political communication and the law's effect on some public interest or purpose wholly unconnected with the implied freedom. Those are the principles that are to be applied in these appeals. But, as this Court has said172 many times, it is necessary to construe a law that is impugned before attention can turn to its validity. 171 See generally Coleman v Power (2004) 220 CLR 1 at 53 [100] per McHugh J; Thomas v Mowbray (2007) 233 CLR 307 at 330-333 [19]-[27] per Gleeson CJ; [2007] HCA 33. 172 See, for example, Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11]; [2008] HCA 4. Hayne The text of s 471.12 is set out earlier in these reasons. It will be recalled that it prohibits the use of a postal or similar service in a way that reasonable persons would regard as being, in all the circumstances, menacing, harassing or offensive. The meaning of "offensive" lay at the centre of the debate about construction in this Court. It is convenient to enter that debate first by noticing the different ways in which that word is used in statute law generally and second by describing the statutory context in which s 471.12 sits. Attention will then turn directly to the text of the section itself. "Offensive" in other statutory contexts Many statutes which create offences have used the word "offensive" as an element of the relevant offence. So, for example, many police and summary offences Acts have made it a crime to use offensive words or to engage in offensive conduct173 in or near a public place. Possession of an "offensive weapon" is a common form of statutory offence174 and may be a circumstance relevant to the commission of aggravated forms of other offences175. Some statutes have used the word "offensive" in contexts which require consideration of notions of pornography and "moral offence"176. In some statutes, most notably those dealing with offensive weapons, the central idea conveyed by "offensive" is of being made or adapted for the purposes of causing injury177. In others, the central idea which "offensive" conveys is of being displeasing, annoying, insulting, or causing painful or 173 See, for example, Summary Offences Act 1988 (NSW), ss 4 and 4A; Summary Offences Act 1966 (Vic), s 17(1)(d); Summary Offences Act 1953 (SA), s 7; Summary Offences Act 2005 (Q), s 6; The Criminal Code (WA), s 74A; Police Offences Act 1935 (Tas), ss 12 and 13; Summary Offences Act (NT), s 47; Crimes Act 1900 (ACT), s 392. 174 See, for example, Summary Offences Act 1988 (NSW), s 27D; Summary Offences Act 1953 (SA), s 15; The Criminal Code (WA), ss 68B and 68C; Crimes Act 1900 (ACT), ss 380 and 381. 175 See, for example, Crimes Act 1900 (NSW), s 97(1); Crimes Act 1958 (Vic), s 60A(1); Criminal Law Consolidation Act 1935 (SA), s 5AA(1)(b); The Criminal Code (WA), s 318(1)(l)(i); Criminal Code (Tas), s 240(3); Criminal Code (NT), s 174G(a); Crimes Act 1900 (ACT), s 35(1)(a)(ii). 176 See, for example, Summary Offences Act 1953 (SA), Pt 7. 177 See, for example, Crimes Act 1958 (Vic), s 77(1A). Hayne unpleasant sensations or reactions. In general use, the word can be used to describe the evoking of a form of sensory reaction (of sight, smell or touch)178. The point to be made is obvious but important. No single definition of "offensive" was or is apt for every different form of crime. Much turns on the context in which the word "offensive" is used. Context of s 471.12 Section 471.12 is one of several offences in what is now subdiv A (General postal offences) of Div 471 (Postal offences) of the Code. Other "General postal offences" include offences of theft of, or receiving stolen, mail-receptacles, articles or postal messages (ss 471.1 and 471.2), taking or concealing those items (s 471.3) and damaging or destroying those items (s 471.6). The subdivision provides for offences of dishonesty, including dishonestly removing postage stamps or postmarks (s 471.4), and dishonestly using previously used, defaced or obliterated stamps (s 471.5). It also provides for offences which concern the transmission of dangerous things: causing a dangerous article to be carried by a postal or similar service (s 471.13) or causing an explosive, or a dangerous or harmful substance, to be carried by post Three provisions deal directly with the content of the articles that are carried by a postal or similar service. One is s 471.10, which makes it an offence to cause an article to be carried by a postal or similar service with the intention of inducing a false belief either that the article consists of, encloses or contains an explosive or a dangerous or harmful substance or thing, or that an explosive or a dangerous or harmful substance or thing has been or will be left in any place. Another is s 471.11, which makes it an offence to use a postal or similar service to make a threat to kill or to cause serious harm, where the person making the threat intends that the person threatened should fear that the threat will be carried out. The third is s 471.12. These appeals do not directly concern the offences in s 471.12 of using a postal or similar service in a way that reasonable persons would consider either menacing or harassing. It may be assumed, however, that "menacing" connotes 178 See The Oxford English Dictionary, 2nd ed (1989), vol X at 726, "offensive", meaning 4. Hayne uttering or holding out threats179 and that "harassing" connotes troubling or vexing by repeated attacks180. Although the appellants are charged with offences relating to the use of the postal service provided by the Australian Postal Corporation ("Australia Post"), it is to be noted that s 471.12 is directed more broadly to a person who uses "a postal or similar service" (emphasis added). The expression "postal or similar service" is defined expansively in s 470.1 of the Code. It means not only "a postal service (within the meaning of paragraph 51(v) of the Constitution)" but also courier and packet or parcel carrying services and any other service that is a postal or other like service within the meaning of the constitutional provision. In addition, it includes courier and packet or parcel carrying services provided by a constitutional corporation, and courier and packet or parcel carrying services that are provided in the course of or in relation to trade or commerce between Australia and a place outside Australia, among the States or between a State and a Territory or between two Territories. It follows that the reach of s 471.12 goes well beyond the use of those postal services which, for most of the 20th century, were provided by the executive government but which are now provided by a government business enterprise (Australia Post). Section 471.12 encompasses the use of postal and analogous services provided by commercial enterprises not owned by the government. And, of course, the section extends well beyond the use of a postal or similar service to send an article to a person at his or her home. It includes communications to or from businesses, arms of government and others. All of these services can generally be described as forming part of the "national infrastructure". Indeed, Div 471 (in which s 471.12 appears) is one of several divisions of Pt 10.5 of the Code, and Pt 10.5 is one of several Parts forming Ch 10, which is entitled "National infrastructure". "Offensive" in s 471.12 Two preliminary observations should be made. First, the text of s 471.12 shows that an objective test must be applied in deciding whether the use alleged meets the description "offensive". The section requires that the accused be shown to have used a postal or similar service "in a way ... that reasonable persons would regard as being, in all the circumstances, ... offensive" (emphasis added). Second, as the first respondent and some interveners correctly pointed 179 See The Oxford English Dictionary, 2nd ed (1989), vol IX at 599, "menace" and "menacing". 180 See The Oxford English Dictionary, 2nd ed (1989), vol VI at 1100, "harass", meanings 3 and 4. Hayne out, the offence created by s 471.12 consists181 of physical elements and fault elements. The fault element of "intention" applies182 to the physical element of "use" of a postal or similar service; the fault element of "recklessness" applies183 to the "circumstance" that the use would be regarded as "offensive". The fault element of recklessness may also be satisfied184 by proof of intention or knowledge. It follows that to establish commission of the offence the prosecution must prove two things. The first is that the accused intentionally used the relevant postal or similar service. The second is that, in so using that service, the accused intended or knew that the use was offensive or was aware of a substantial risk that the use was offensive and, having regard to all the circumstances known to the accused, it was unjustifiable to take that risk. Accepting that the offence in s 471.12 depends upon an objective standard and that it has the elements identified, what content is to be given to the word "offensive"? What is "offensive" for the purposes of s 471.12 must be identified by reference to the reaction that the conduct in question would evoke in the hypothesised reasonable person exposed to the conduct. No party or intervener submitted that what is "offensive" for the purposes of s 471.12 was to be identified in some other way and there appeared to be little if any dispute that the relevant kind of reaction could be described by any or all of the several words used185 by the Court of Criminal Appeal: anger, resentment, outrage, disgust or hatred. There was, however, a debate about how intense the reaction must be to constitute the offence. At least a majority of the Court of Criminal Appeal proceeded 186 on the basis that the preferable construction of the section required a strong reaction from the hypothetical reasonable person to the conduct in question before that conduct would merit the description "offensive". intensifying epithets to describe the reaction that the conduct in question was 181 Code, s 3.1(1). 182 Code, ss 4.1(1)(a), 4.1(2) and 5.6(1). 183 Code, ss 4.1(1)(c) and 5.6(2). 184 Code, s 5.4(4). 185 (2011) 256 FLR 28 at 39 [44] per Bathurst CJ, 48 [83], 50 [91] per Allsop P. 186 (2011) 256 FLR 28 at 39 [44] per Bathurst CJ, 48 [83], 50 [91] per Allsop P. 187 (2011) 256 FLR 28 at 39 [44]. Hayne calculated or likely to arouse: "significant anger, significant resentment, outrage, disgust, or hatred" (emphasis added). Presumably, then, the reaction of the hypothetical reasonable person intended by these descriptions must be a reaction that is clearly experienced and deeply felt. Contrary to the submissions of the appellants, s 471.12 does not make it a crime to use a postal or similar service in a way that would merely "hurt or wound the feelings of the recipient" of a postal article. Understood in that way, the section would deal with forms of offensive conduct properly described as trifling. The word "offensive" must be given a narrower meaning than that. It is used in conjunction with "menacing" and "harassing" and all three forms of use are treated, without distinction between them, as meriting the same punishment of up to two years' imprisonment. The Court of Criminal Appeal was right to conclude that the provision is to be construed as requiring a strong reaction. It is sufficient to proceed, as the parties did for much of the argument in this Court, on the footing that the section bears the meaning adopted by at least a majority of the Court of Criminal Appeal and advanced by those supporting the section's validity. Even on that assumption, the section's prohibition of offensive use of a postal or similar service is invalid, at least in its application to the use of such a service for making political communications. But before considering the constitutional question, it is important to say something about two matters considered by Allsop P. First, Allsop P observed188 that in considering a charge brought under s 471.12, a jury would have to take account of the fact that reasonable persons would know of "the existence and importance of the freedom of expression". The respondents and most interveners picked up and supported this observation. The first respondent submitted that the section's reference to use in a way that "reasonable persons would regard as being, in all the circumstances, ... offensive" "leave[s] room for" the operation of the implied freedom. The first respondent further submitted that the jury at the trial of a charge brought under s 471.12 were "ideally positioned" to determine whether the impugned use was "offensive" and that they could be directed to consider the "robust" nature of political debate in Australia. The second respondent and most interveners made submissions to the same effect. It may be accepted that the political subject or context of a communication is a circumstance to be taken into account in determining whether a communication is "offensive". But what follows from that trite observation? 188 (2011) 256 FLR 28 at 50 [88]. Hayne It was not said by any party or intervener that the section's reference to "reasonable persons" and "in all the circumstances" would have the result that the maker of a political communication could never be found guilty of an offence against s 471.12. Had that submission been made, it would have assumed critical importance to the disposition of these appeals because there would be no restriction on political communication at all. Instead, the assumption which underpinned all of these submissions was that the political subject or context of a communication would reduce (but not eliminate) the uses of a postal or similar service to communicate a political message which would be found to be "offensive". That assumption would lead to the conclusion that the section restricts a narrow class of political communication. And that conclusion would properly be taken into account in determining whether s 471.12 is reasonably appropriate and adapted to achieving a legitimate object or end in a manner compatible with the constitutionally prescribed system of government and the freedom of political communication. But is the assumption correct? In many if not most cases, neither words nor conduct become any less "offensive" because they are uttered or occur in a particular political context or in connection with a political subject. Some contributions to political debate are deliberately designed to be insulting and belittling. They are intended to sting as much as possible and, in doing so, to be such as would inevitably evoke in the reasonable person significant anger, significant resentment, outrage, disgust or hatred. The gist of the offence is to be found in the reaction that reasonable persons would have to the communication. The political nature of a communication or occasion will rarely lessen the offence and it is artificial to expect that a jury direction in terms that political debate is typically "robust" in Australia would lead a jury to find a use not to be offensive when otherwise they would have found it to be offensive. If anything, the outrage caused by a communication will be worse when it arises out of, or relates to, matters of wider importance than relations between two individuals. To the extent to which the submission, as it was developed in oral argument by the first respondent, appeared to be one which would seek to leave to the decision of the tribunal of fact at trial whether and to what extent the freedom is affected by the section, it is a submission without foundation. Questions of constitutional validity are not questions of fact to be decided by a jury. Secondly, Allsop P considered, but did not adopt189, a construction of s 471.12 which would make it necessary to demonstrate that the relevant use of 189 (2011) 256 FLR 28 at 50 [89]. Hayne the postal or similar service was "objectively calculated or likely ... to cause real emotional or mental harm, distress or anguish". The words of the provision give no foundation for such a reading. In its operation with respect to the use of a postal or similar service in a way that reasonable persons would regard as offensive, the section makes no reference at all to any harm to any person. Given this construction of the offensive aspect of s 471.12, is that aspect of the section valid in its application to political communications? As has been explained, that depends upon the answers given to the two Lange questions (as modified by the majority in Coleman v Power). Section 471.12 effectively burdens political communication Section 471.12 prohibits using a postal or similar service to make communications that are "offensive" in the sense that has been described. The section applies generally. It therefore prohibits some political communications (those where the communications are made through the use of a postal or similar service and are objectively offensive in the sense described). No party or intervener contended to the contrary. It follows that the section effectively burdens the freedom of political communication. It will be recalled that, notwithstanding their concession, rightly made, that s 471.12 can operate to prohibit some political communications, the first respondent, and most of the interveners, sought to resist the conclusion that the first Lange question must be answered "Yes" by resort to the assertion that the section does not "effectively burden" political communication because it is only a "little" burden. It may be accepted that s 471.12 has a narrow operation. It deals only with use of a postal or similar service, the use must be objectively offensive in the sense described, and the mental elements of the offence must be proved. But to observe that the section has this "narrow" operation is to state the minor premise of the argument. And that statement of the minor premise does no more than describe how the section operates. It may be that this operation of s 471.12 can be described as a "little" burden on political communication. But assuming that this is right, the assumption reveals why the major premise of the argument – that a "little" burden does not "effectively burden" political communication – cannot be right. These reasons have already explained why that is so. It is sufficient to repeat that to move from some quantitative assessment of the effect of s 471.12 on political communication to the qualitative assessment that it is only a "little" burden is to assume that the form of communication eradicated from political debate is unimportant. On this view, it does not merit constitutional protection. The argument has the same functional effect as an argument that says that the form of communication in issue is not political communication. But only the Hayne first respondent was bold enough to submit that the communications in issue in these appeals were not communications about a matter of federal political controversy. (The correctness of that submission is examined below.) If that argument is to be made, it should be put squarely, as the first respondent did. The result is not to be achieved by applying the label "little" to the burden that is identified. The object or end pursued by s 471.12 Because s 471.12 effectively burdens political communication, it is necessary to consider whether it is reasonably appropriate and adapted to serve a legitimate end in a manner that is compatible with the maintenance of the constitutionally prescribed system of government and the freedom of political communication which is its indispensable incident. As has been explained, this requires identification of the object or end which the section pursues. And, as has also been explained, that task is to be carried out by applying the ordinary processes of statutory construction. Before doing that, it is useful to describe the arguments of the parties and interveners on this issue. In this Court, the parties and interveners made extensive submissions about the possible object or end (or the possible objects or ends) pursued by s 471.12. The submissions did not always clearly separate the objects or ends and the submissions sometimes slid between one or more of the objects or ends that were identified. One way or another, four candidates emerged. They can be described as "civility of discourse", "integrity of the post", "prevention of violence" and "welfare of the recipients of postal articles". The second appellant submitted that s 471.12 seeks only to regulate the civility of discourse and that this end is not legitimate. The respondents and interveners referred to the three other candidates in support of their arguments for validity. These three candidates were deployed in argument in two different ways. Sometimes it was said that the object or end to which s 471.12 is directed is one or other of them (integrity of the post, prevention of violence or welfare of recipients). Sometimes it was said that the object or end of s 471.12 is limited to preventing the sending of offensive materials by a postal or similar service and that this object or end is legitimate because it is conducive to one or more of the three candidates that have been identified. In practical terms there may be little separating the two forms of argument in these appeals. Each form of argument depends upon the content that is given to each of the candidate ideas. But the distinction between the two forms of argument is not unimportant. In these appeals, it is the second form of argument that provides the appropriate frame of reference. The object or end of s 471.12 must be framed in limited terms. Both legally and practically, the offensive limb of s 471.12 has only one object or end: to penalise, and thereby prevent, giving offence to recipients of, and those handling, articles put into a postal or similar service. Hayne Apart from the (perhaps rare) case where offensive images or words appear on the envelope or packet, the chief practical operation of the section is to prevent offence (in the sense described) to recipients of articles delivered by a postal or similar service. That is not to say, however, that the submissions that were made about such matters as "integrity of the post" are irrelevant. Those submissions are to be understood as directed to whether the object or end of preventing offensive uses of a postal or similar service is an object or end that is compatible with the maintenance of the constitutionally prescribed system of government and the freedom of political communication which is its indispensable incident. But it is as well to explain why, contrary to the submissions of the respondents and interveners, the object or end to which s 471.12 is directed cannot be identified as any of the three candidates they urged: "integrity of the post", "prevention of violence" and "welfare of the recipients of postal articles". Attention can then turn to whether the narrow object or end of preventing offence to mail recipients and handlers is conducive to any or all of those candidates and whether, for that reason, s 471.12 serves a "legitimate" end. First, the object or end to which the section is directed cannot be identified as protecting from harm the recipients of, or those who handle, postal articles. Because the section applies an objective test of what is "offensive", the section does not require proof that any person has actually suffered the reactions of significant anger or the like that have been described. And as earlier explained, a person accused of contravention of s 471.12 need not be shown to have intended to cause offence. It is enough to show that the accused was reckless to the possibility that such a reaction would be evoked. Nor can the object or end of the section be identified as protecting recipients of, or those who handle, postal articles from legally cognisable harm. None of the reactions described – significant anger, significant resentment, outrage, disgust or hatred – constitutes a form of legally cognisable harm. Anger, resentment, outrage, disgust and hatred, however intense, are transient emotional responses which may, and more often than not will, leave no mark upon the individual who experiences them. More than that, the emotional responses described are universal human responses which are among the "ordinary and inevitable incidents of life"190. They can be provoked for any of a myriad of reasons, in well-nigh any circumstances. Experiencing responses of these kinds does not set the person concerned apart from any save the most sheltered or placid of human beings. 190 Tame v New South Wales (2002) 211 CLR 317 at 382 [193] per Gummow and Kirby JJ; [2002] HCA 35, quoting Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310 at 416. Hayne Second, it is not possible to say that the object or end of the section is the prevention of violent retaliation. The section says nothing of the sort and the likelihood of violence is neither a necessary nor a sufficient element of the offence. Third, the object or end of s 471.12 cannot be identified more broadly as maintaining the "integrity of the post". In this regard, the Commonwealth pointed to the second reading speech made in support of the Bill191 for the insertion of s 471.12 and related sections into the Code. It was there said192 that: "Protecting integrity of Australia's information infrastructure, including postal and courier services, is a priority for this Government. the safety, security and The measures contained in this bill will ensure that these important communication services are not compromised by irresponsible, malicious or destructive behaviour." In the light of these statements, it may readily be accepted that the political motives for inserting s 471.12 and other provisions into the Code included protecting the "integrity of the post". But it does not follow that the expression is an apt description of the object or end to which s 471.12 is directed. Nothing in the statutory text supports such a broad view. In its operation with respect to offensive use of a postal or similar service, s 471.12 regulates the content of what may be communicated by post. It thus limits the kinds of communication that can be committed to a postal or similar service. It does not deal at all with, and is not directed to, the safety, efficiency or reliability of those services or any of them. To adopt and adapt what Dixon J said193 in a different context, what was said in the second reading speech may reveal the "external motive or purpose" for the amendments that were then made to the Code, but the "only ostensible purpose" evident from the statutory text is the prevention of offence to recipients of, and others handling, articles committed to a postal or similar service. Is that object or end "legitimate"? To penalise, and thereby seek to prevent, the giving of offence to recipients of, and those handling, articles put into a postal or similar service regulates the civility of discourse, including political discourse, conducted by the 191 Criminal Code Amendment (Anti-hoax and Other Measures) Bill 2002 (Cth). 192 Australia, Senate, Parliamentary Debates (Hansard), 11 March 2002 at 441. 193 Moore v The Commonwealth (1951) 82 CLR 547 at 568; [1951] HCA 10. Hayne use of those services. Unless some reason can be shown why that object or end is legitimate, this Court's decision in Coleman v Power dictates the conclusion that the object or end of s 471.12 is not compatible with the constitutionally prescribed system of government and the freedom of political communication which is its indispensable incident. Queensland's submissions that Coleman v Power does not require this conclusion must be rejected. The submissions made about "integrity of the post", "prevention of violence" and "welfare of the recipients of postal articles" were all directed to explaining why regulating the civility of this form of discourse by penalising offensive uses of a postal or similar service is a legitimate object or end. Each is considered in turn. Integrity of the post? The expression "integrity of the post" has a large and satisfying ring to it. It sounds important and valuable. It is convenient to accept that, despite the very large changes that have occurred in the last years of the 20th century and the first 12 years of this, the existence of an efficient postal service remains important and valuable. But it by no means follows that preventing users sending material that will cause others offence, even really serious offence, bears upon whether the postal service continues to exist or continues to operate efficiently. The point which these submissions made may have been expressed more accurately by Lord Bingham of Cornhill when he described 194 legislation which made195 it an offence to send "grossly offensive" material by means of a "public electronic communications network" as prohibiting "the use of a service provided and funded by the public for the benefit of the public for the transmission of communications which contravene the basic standards of our society". Two separate elements of this proposition must be noticed. The first, expressed crudely, is that society can regulate what society provides. The second is wrapped up in the reference to "the basic standards of our society". Unpacking the proposition to identify both of these elements shows that despite its rhetorical power, the proposition does no more than restate the question for determination. The question for decision in these appeals is whether there is legislative power to prohibit offensive political communications which are conveyed by a postal or similar service. Observing that the form of service that was used was provided by a government business enterprise (and in that sense provided by society) does not advance the analysis. And likewise, approving gestures to the importance or unique quality of the postal service do not advance the debate. What remains to be considered, and what these approving statements ignore, is 194 Director of Public Prosecutions v Collins [2006] 1 WLR 2223 at 2227 [7]; [2006] 4 All ER 602 at 607. 195 Communications Act 2003 (UK), s 127(1). Hayne how offensive communications detrimentally affect a postal (or similar) service at all. If it is said that s 471.12 maintains (or tends to maintain) the "integrity of the post", content must be given to that expression. But despite the pressure of argument, no party or intervener gave the expression a meaning that could support the validity of the section. When it is said to be important to maintain the "integrity of the post", the central idea that is conveyed is that it is important to ensure that postal articles are carried safely (perhaps safely and efficiently) to their intended recipients. That this is what the expression should be understood to mean is revealed by consideration of those statutory provisions which provide for the postal service which the appellants are alleged to have used. The Australian Postal Corporation Act 1989 (Cth) continued in existence Australia Post as a body corporate the principal function of which is to supply postal services within Australia and between Australia and places outside Australia196. The Act obliges Australia Post to supply a letter service197, to ensure that the service is reasonably accessible to all people in Australia and to ensure that the performance standards for the letter service "reasonably meet the social, industrial and commercial needs of the Australian community"198. Against this background, it is perfectly apposite to say that measures taken to ensure that letters and other postal articles committed to Australia Post are not stolen or diverted, or destroyed or damaged in transit, are directed to the maintenance or preservation of the "integrity of the post". Such measures are directed to that end because they ensure that whatever is committed to the postal system arrives, and arrives undamaged by other articles that are being carried. It may be harder to describe in the same way a measure that deals not only with postal services but "similar services" supplied by commercial courier and packet or parcel carrying services199. At the least, there would have to be some expansion of the notion of "the post", and perhaps some account taken of the fact that the services the "integrity" of which is to be protected are provided not by the executive government or any government business enterprise, but by a diverse group of commercial enterprises whose terms and conditions of carriage are not directly regulated. It is, however, not necessary to consider whether this second set of steps could be taken. 199 Code, s 470.1, definition of "postal or similar service". Hayne Concern for the "integrity of the post" must focus upon its safety and reliability as a means of carriage for postal articles. The nature or content of the articles a postal service carries has a connection with that concern only if a postal article (or its contents) might damage or destroy another article or delay its delivery. But apart from the case where something written on the outside of a postal article might cause a delay in delivery of that or other articles – as might be the case if a package was said to contain a dangerous substance – what is written in or on any postal article can have no effect on the reliability or safety of the postal system. If some extended meaning were to be given to the "integrity of the post" which would direct attention to the content of the articles carried, the use of the expression "integrity of the post" would depend upon a premise that the post should be used for only some kinds of messages or communications. That is, the "integrity of the post" would be defined in a way that directs attention to the nature or content of what is communicated by post and requires that those communications meet some standard (whether described as a standard of decency, politeness, integrity or otherwise). If the "integrity of the post" is defined in this way, circular reasoning beckons. The end to which the legislation under consideration is directed is defined in a way which assumes without examination that the fixing of standards which the content of communications carried by post must meet is important to the effective operation of the postal service. There is no foundation for that proposition. It is bare assertion. The first respondent and several interveners sought to link "integrity of the post" with regulation of the content of what is carried by reference to a notion of "confidence" in the post. It was said that the integrity of the post would be affected adversely if both the senders and the recipients of postal articles did not have "confidence" in the post. On the face of it, the argument appears to be no more than a restatement of the proposition that those who use the postal service should be able to be sure that articles committed to the service will be delivered safely to their intended recipients. But as developed in oral argument it became apparent that "confidence" was being used in a sense which again depended upon bare assertion and again invited circular reasoning by defining the object or end to which the law is directed in a question-begging manner. The assertion was that, if really offensive communications can be made by post, recipients would be "fearful" (presumably fearful of receiving a communication that would offend them). Some submissions went no further than that. If the assertion is right (and there is no basis for deciding that it is) it is an observation that leads to no relevant legal conclusion. Perhaps it is for that reason that the Commonwealth took a further step in its argument and asserted that there could and would be consequences for the postal service flowing from this postulated fear. The Commonwealth identified these consequences as persons being "discouraged from willing receipt of mail" with a consequent "adverse effect upon the willingness of senders ... to use postal services as a Hayne means of communication". No basis for this assertion was provided. It is not an assertion that is self-evidently likely to be true. On the contrary, the notion that a person who has received an offensive communication in the mail (even one that is really offensive) will thereafter not take any mail at all is inherently improbable. If that were ever to happen its occurrence would be very rare indeed and it would have not the slightest effect on the general operation of the postal service. The fears expressed by the Commonwealth should be dismissed as spectral. Prevention of violence? The first respondent submitted that penalising, and so preventing, offensive uses of a postal or similar service was legitimate because doing so prevented violent responses and thus prevented breaches of the peace. The proposition appeared to be founded on some extrapolation from what was decided in Coleman v Power and was endorsed200 by Bathurst CJ in the Court of Criminal Appeal. The proposition should be rejected. It can be answered shortly. Section 471.12 is in no way directed to or concerned with preventing violence or keeping the peace. The prospects that were conjured up in argument of retaliation for offence done by use of a postal or similar service were no more than speculative imaginings of premeditated and vengeful lawlessness which should be dismissed from consideration. They have no foundation and no attempt was made to provide any, whether by evidence or argument. Having regard, however, to the emphasis given in argument to notions of violent reprisal, and to the significance it was given in the Court of Criminal Appeal, something more should be said about Coleman v Power. It will be seen that the decision in that case provides no support for, indeed runs directly contrary to, the submission made by the first respondent. It will be recalled that the legislation201 in issue in Coleman v Power made it a crime for a person "in any public place or so near to any public place that any person who might be therein ... could ... hear" to use "any threatening, abusive, or insulting words to any person". It was said that the provision did not infringe the implied freedom of political communication, and was valid, if the references to "abusive" and "insulting" words were "understood as those words which, in the circumstances in which they are used, are so hurtful as either they are intended to, or they are reasonably likely to provoke unlawful physical retaliation"202. 200 (2011) 256 FLR 28 at 43 [64], 44 [67]. 201 Vagrants, Gaming and Other Offences Act 1931 (Q), s 7(1)(d). 202 Coleman v Power (2004) 220 CLR 1 at 77 [193]. Hayne That construction of the provision was available because the offence in question was one that could not be committed unless the words were uttered in or within the hearing of a public place. It is of the first importance to recognise that this construction of the legislation was a step that was both necessary and sufficient to support the conclusion of validity. Confining the reach of the provision to cases in which the words used are so hurtful as to be either intended, or reasonably likely, to provoke unlawful physical retaliation was sufficient for validity because, so understood, the law was reasonably appropriate and adapted to keeping public places free from violence203. But confining the reach of the provision in this way was also necessary to validity. If read as making it a crime to utter any words to a person in, or within the hearing of, a public place that are calculated to hurt the personal feelings of that person, the end served by the law would "necessarily be described in terms of ensuring the civility of discourse. ... [A]n end identified in that way could not satisfy the second of the tests articulated in Lange."204 (emphasis added) Reading the provision as confined to words connected by intention or effect with violent retaliation both permitted and required identifying the end to which the impugned law was directed as "keeping public places free from violence"205. That end is compatible with the constitutionally prescribed system of government and with that freedom of communication which is its indispensable incident. Ensuring civility of discourse in public is not. And ensuring civility of private discourse is even further removed from a legitimate object or end. There are important, if obvious, distinctions between the legislation at issue in Coleman v Power and s 471.12. First, s 471.12 has no connection with any conduct in a public place, no matter whose conduct is considered: the sender of the communication, the carrier of the relevant postal article, or the recipient of what is communicated. All of the facts and circumstances surrounding a contravention of s 471.12 can, and commonly will, occur in private. The user of the service frames his or her offensive communication in private, the user typically encloses it in an envelope in private, and the recipient opens the communication in private and experiences offence. Second, the meaning of the word "offensive" in s 471.12 focuses upon the reaction that the use of the postal or similar service would evoke in reasonable persons. As already explained, that reaction can be identified as "significant anger, significant resentment, outrage, disgust, or hatred". The recipient may have no such reaction. There may be circumstances in which a recipient who experiences reactions described in those 203 (2004) 220 CLR 1 at 78 [198]. 204 (2004) 220 CLR 1 at 79 [199]. 205 (2004) 220 CLR 1 at 78 [198]. Hayne terms might contemplate resorting to violence. But they are surely the exception rather than the rule. Even if it is right to take account of the exceptional case in which a person who experiences significant anger, significant resentment, outrage, disgust or hatred may be provoked to contemplation of violence, how would that surge of anger be translated into action? As Coleman v Power shows, questions about maintaining the peace require consideration of the circumstances in which the relevant conduct is experienced by the person to whom it is directed or who observes its occurrence. In particular, the critical point in Coleman v Power was that the conduct in question (the use of abusive or insulting words to a person) had three relevant characteristics: it took place in, or within the hearing of, a public place; it had to be intended or reasonably likely to provoke physical retaliation; and of necessity it occurred in circumstances where the exaction of revenge or retaliation for the insult could occur at once. By contrast, neither an intention to provoke violence nor a likelihood of violent response forms any part of the offence created by s 471.12. Typically, if offence is felt, it will be experienced in private. And seldom if ever will the user of the postal or similar service whose conduct is offensive be close at hand when a person who is offended experiences the feelings described. Indeed, it may well be that the person who experiences those feelings does not know and cannot readily find the person who used the postal or similar service. Protecting mail recipients? As has already been explained, "offensive" in s 471.12 cannot be read as limited to uses of a postal or similar service that are "objectively calculated or likely ... to cause real emotional or mental harm, distress or anguish"206. Yet it was said that penalising, and so preventing, offensive uses of a postal or similar service was legitimate because it protected mail recipients from harm. That harm was described in several different ways. Victoria described offensive uses of a postal or similar service as "offensive intrusions" into the lives of the recipients. Queensland referred to "a person's security of domain". The Commonwealth also referred to "security of domain" but it further referred to the threat to a person's "legitimate sense of safety". These harms were said to be caused, or made worse, by the fact that mail is commonly addressed to a named recipient and that, adopting an expression drawn from a decision of the Supreme Court of the United States, mail recipients are a "captive"207 audience for whatever is sent to them by post. 206 (2011) 256 FLR 28 at 50 [89] per Allsop P. 207 Frisby v Schultz 487 US 474 at 487 (1988). Hayne Each of these descriptions, shorn of their rhetorical flourishes, sought to combine the intensity of reaction required for conduct to be classed as "really" or "seriously" offensive with an appeal to notions of integrity of the person or private property. Notions of integrity of the person or of property accord with the ordinary legal usage of the word "protection". It connotes protection from legally cognisable harm in the form of damage to person, pocket, property or reputation. And cases like Levy and Lange show that protection of bodily integrity and protection of reputation are objects or ends which are compatible with the constitutional system of government and the freedom of political communication. Each concerns a form of legally cognisable harm: injury to the person in one case and injury to reputation in the other. Each of the forms of "harm" identified in the submissions falls short of any form of legally cognisable harm and the second respondent correctly conceded this to be so. No less importantly, s 471.12 directs no attention to any such form of harm. The allusions made in the submissions to notions of intrusion upon, or injury to, the integrity of a person or a person's property find no foundation in the text of the section. Intrusion or injury of that kind, whether legally cognisable or not, is neither an element of the offence nor a necessary consequence of its commission. Rather, the section's sole concern is the prevention of "serious" offence. It pursues no wider object or end. It may be that the references to "security of domain" and "intrusions" were intended to appeal, inferentially, to notions of privacy. But if that was their intention, the appeal is misplaced. Delivery of mail, whether at home or at work, or by leaving an article in a post office box, is no intrusion upon the privacy of the recipient. It is an unremarkable feature of everyday life tolerated, if not always welcomed, by all. What was described as an "offensive" intrusion was the disturbance to the equanimity of the recipient that might be caused by the offensive character of what was received. But that disturbance (which might occur anywhere) is in no sense any intrusion upon the recipient's privacy. Section 471.12 is not directed to an object or end of preserving privacy. Lying behind many of the submissions advanced in these appeals was a proposition that should be brought to the foreground. It was that s 471.12 carves out an area for its operation that lies between "mere" civility of discourse and the infliction of physical or psychiatric injury. The area in question was said to be occupied by the "really" or "seriously" offensive. Prevention of that kind of conduct was said to be compatible with the constitutionally prescribed system of representative and responsible government and with the implied freedom of political communication. Hayne Consideration of this proposition must begin with the observation made by McHugh J in Coleman v Power208 that "[i]nsults are as much a part of communications concerning political and government matters as is irony, humour or acerbic criticism". Insult, irony and criticism may all give offence. Sometimes, insult, irony or criticism may give such serious offence that a reasonable person would be moved to "significant anger, significant resentment, outrage", even "disgust, or hatred". to disseminate Some forms of political communication are deliberately designed to offend. They may be designed and intended to offend because their content is shocking and the maker, having made reasonable inquiries to verify their content, wishes the statement communicated is such as reasonable persons, in all the circumstances, would its regard as evoking communication by post, on pain of up to two years' imprisonment, regardless of whether it is true or false and regardless of whether its maker took all reasonable steps to verify the truth of what is communicated. reaction described, s 471.12 would information widely. forbid Yet the the If a statement is defamatory it may very well move reasonable persons to significant anger, significant resentment, outrage, disgust or hatred. Indeed that may be the strength of reaction which the person making such a communication in relation to government or political matters wants and intends to cause. And if the sender of the communication acted reasonably, Lange may provide the sender with a defence to an action for defamation. But s 471.12 would make the sender's conduct a crime. This point about defamatory statements requires further elaboration. What comparison can or should be made between s 471.12 and the law of defamation was much debated in this Court. The Commonwealth rightly pointed out that the legislation considered in Coleman v Power provided none of the defences available to a claim for defamation, yet the law was held valid. This being so, why does it matter, so the argument continued, if an offence against s 471.12 can be committed by using a postal or similar service to publish defamatory material even though the publisher would have a defence to a civil action for defamation? The answer to this question is found by recognising that, absent physical or psychiatric injury, the extent of the individual's interest in preventing or recovering for the consequences of a communication of this kind is measured and can only be vindicated by action for defamation. If s 471.12 were to be understood as directed to an object or end of preventing harm to or intrusion upon the individual, it does so in a way that is not coherent with the rights of the individual whose interest it is said that the section protects. And if the section is 208 (2004) 220 CLR 1 at 45 [81]. Hayne directed to vindicating some wider or societal interest, as the applicable legislation was in Coleman v Power, the object or end to which s 471.12 is directed cannot then be identified as preventing intrusion upon the safety or security of the individual's domain. To hold that a person publishing defamatory matter could be guilty of an offence under s 471.12 but have a defence to an action for defamation is not and cannot be right. The resulting incoherence in the law demonstrates either that the object or end pursued by s 471.12 is not legitimate, or that the section is not reasonably appropriate and adapted to serve a legitimate end in a manner compatible with the maintenance of the constitutionally prescribed system of government and the freedom of communication that is its indispensable incident. The incoherence is not removed, and its consequences cannot be avoided, by leaving a jury to decide whether reasonable persons would regard the use, in all the circumstances, as offensive. In the case postulated, the user of the service both knows that the communication is, and intends that the communication be, offensive. And there is no basis for the proposition (advanced by the second respondent and Queensland) that a jury would not find an accused guilty of an offence against s 471.12 in circumstances of the kind now under consideration because of the section's reference to "reasonable persons ... in all the circumstances". Statements that are political in nature and reasonable for a defendant to make can and often will still bite in the sense relevant to s 471.12. A statement can still be offensive even if it is true209. The better view is that the object or end pursued by s 471.12 is not a legitimate object or end. Preventing use of a postal or similar service in a way that is offensive does no more than regulate the civility of discourse carried on by using such a service. Coleman v Power established that promoting civility of discourse is not a legitimate object or end. If, contrary to the view that has just been expressed, it were to be decided that the object or end to which s 471.12 is directed is legitimate, the observation that has been made about the lack of intersection between the Lange defence to a claim for defamation and the operation of s 471.12 would demonstrate that the section is not reasonably appropriate and adapted to serve that object or end in a manner that is compatible with the constitutionally prescribed system of government and with the freedom of political communication which is its indispensable incident. The resulting incoherence in the law requires that conclusion. In Lange210, this Court held that it was necessary to develop the common law of defamation in order to preserve the compatibility of that law with 209 cf Patrick v Cobain [1993] 1 VR 290 at 294. 210 (1997) 189 CLR 520 at 571, 575. Hayne the implied freedom, and so the Constitution. To uphold the validity of the offensive aspect of s 471.12 would cut across the development made in Lange by subjecting to criminal liability conduct that could not, for constitutional reasons, be subject to civil liability. If the object or end of the "offensive" limb of s 471.12 is legitimate, the answer to the second Lange question must be "No". It is necessary to say something more about the legitimacy of the object or end to which s 471.12 is directed. The ground marked out as "really" or "seriously" offensive conduct is identified by the strength of reaction that, judged objectively, would be evoked by the conduct. But all forms of giving "offence" are identified by reference to the expected or actual reaction evoked by particular conduct. The only distinction between the "really" or "seriously" offensive and any other form of offensive conduct is the intensity of the reaction that is or would be evoked. Thus, the prohibition or regulation of the "really" or "seriously" offensive is the prohibition or regulation of some instances of a larger class. Applying this observation to s 471.12, the section relevantly prohibits some, but not all, instances of a particular kind of interaction (or discourse) between people (communication by use of a postal or similar service) where the class of instances prohibited is fixed by the intensity of the reaction evoked and not by notions of harm to a person or intended or likely violent reaction. The form of regulation adopted in s 471.12 does not seek to preclude all offensive conduct. It prohibits only a smaller class of that conduct. But it remains a form of regulation which seeks to exclude from one form of discourse between people (communication by use of a postal or similar service) a specified class of communications. What is the significance of seeking to mark out this middle ground for the question whether s 471.12 serves a legitimate object or end? For the purposes of that inquiry, the prohibition or regulation of "really" or "seriously" offensive conduct is no more than the regulation of some but not all aspects of conduct the regulation of which would serve to promote the civility of discourse. That is, the form of regulation does not sit in any middle ground that can be seen as lying between the "mere" civility of discourse and infliction of injury. The supposed middle ground is no more than one part of a wider field. It follows from Lange and Coleman v Power that s 471.12 is not directed to a legitimate object or end. The elimination of communications giving offence, even serious offence, without more is not a legitimate object or end. Political debate and discourse is not, and cannot be, free from passion. It is not, and cannot be, free from appeals to the emotions as well as to reason. It is not, and cannot be, free from insult and invective. Giving and taking offence are inevitable consequences of political debate and discourse. Neither the giving nor the consequent taking of offence can be eliminated without radically altering the Hayne way in which political debate and discourse is and must be continued if "the people" referred to in ss 7 and 24 of the Constitution are to play their proper part in the constitutionally prescribed system of government. On its own, regulating the giving of offence is not a legitimate object or end. And for the reasons that have been given, s 471.12 pursues no other object or end. Beyond the matters already mentioned ("integrity of the post", "prevention of violence" and "protection of mail recipients") no party or intervener sought to demonstrate that there was any other advantage gained or sought to be gained by marking out this supposed middle ground of "really" or "seriously" offensive conduct and making it an offence to use a postal or similar service in that way. All that was said was that s 471.12 prevents conduct of this kind and that mail recipients were, therefore, less likely to be exposed to communications that are "really" or "seriously" offensive. But, as has already been explained, identifying the section's legal and practical operation does not identify any legitimate object or end. The conclusion that eliminating the giving of offence, even serious offence, is not a legitimate object or end is supported by reference to the way in which the general law operates and has developed over time. The general law both operates and has developed recognising that human behaviour does not accommodate the regulation, let alone the prohibition, of conduct giving offence. Almost any human interaction carries with it the opportunity for and the risk of giving offence, sometimes serious offence, to another. Sometimes giving offence is deliberate. Often it is thoughtless. Sometimes it is wholly unintended. Any general attempt to preclude one person giving any offence to another would be doomed to fail and, by failing, bring the law into disrepute. Because giving and taking offence can happen in so many different ways and in so many different circumstances, it is not evident that any social advantage is gained by attempting to prevent the giving of offence by one person to another unless some other societal value, such as prevention of violence, is implicated. The common law has never recognised any general right or interest not to be offended. The common law developed a much more refined web of doctrines and remedies to control the interactions between members of society than one based on any general proposition that one member of society should not give offence to another. Apart from, and in addition to, the development of the criminal law concerning offences against the person, the common law developed civil actions and remedies available when one member of society injured another's person or property, including what was long regarded as the separate tort in Wilkinson v Downton211 for deliberate infliction of "nervous shock". (Whether or to what extent such a separate tort is still to be recognised need not Hayne be examined.) And the common law developed the law of defamation to compensate for injury to reputation worked by the publication of oral or written words. But the common law did not provide a cause of action for the person who was offended by the words or conduct of another that did not cause injury to person, property or reputation. From time to time, and in various ways, legislatures in common law jurisdictions, including Australia, have created crimes which hinge on words or conduct being "offensive". Most notably, legislatures have sought to regulate the possession, sale or distribution of written or other articles offensive to some generalised standard of moral sensibility. One method of regulation commonly employed has been to regulate what can be sent by post and, in particular, to make it an offence to send indecent or obscene material by post. The earliest form of federal legislative regulation of the sending of certain kinds of offensive matter by post went beyond prohibiting the sending of indecent or obscene material. Section 107(c) of the Post and Telegraph Act 1901 (Cth), which commenced operation on 1 December 1901, made it an offence to knowingly send, or attempt to send, by post any postal article which "has thereon or therein or on the envelope or cover thereof any words marks or designs of an libellous or grossly offensive character" indecent obscene blasphemous (emphasis added). The reference to "grossly offensive character" in s 107(c) was not confined to the indecent or the obscene. That follows from first, the collocation of words used in s 107(c) and second, from a comparison with s 107(b), which made it an offence to knowingly send, or attempt to send, by post any postal article which "encloses an indecent or obscene print painting photograph lithograph engraving book card or article". It is evident, then, that the prohibition in s 107(c) would have encompassed some, perhaps much, of the conduct with which s 471.12 of the Code deals. In doing this, s 107(c) departed sharply from the colonial Act on which the legislative sidenote indicates the section was based: s 98 of The Post and Telegraph Act 1891 (Q). Section 98(3) of the Queensland Act (like a then current equivalent English provision212) was directed only to the transmission of materials of "an indecent, obscene, or grossly offensive, character". Although the Queensland Act (unlike the English Act) dealt with both the envelope or cover of the postal article and what was "therein", both the Queensland Act and the English Act used the word "offensive" in a manner that directed attention only to an offence to moral sensibilities worked by indecent material. Unlike the later federal provision, neither the Queensland Act nor its English equivalent dealt with libellous matter or with matter that was offensive in some sense wider than "morally" offensive. 212 Post Office (Protection) Act 1884 (UK), s 4(1)(c). Hayne Observing that s 107(c) of the Post and Telegraph Act 1901 had this broad reach does not dictate the outcome of the present debate about the validity of s 471.12 of the Code. In particular, the observation does no more than provoke the same questions about s 107(c) of the 1901 Act as are presented about the prohibition in s 471.12 of offensive uses of a postal or similar service. Political communication that The first respondent contended that the Court of Criminal Appeal should this matter were not have held communications concerning a government or political matter. The submission was not developed at any length. The central point made in the first respondent's written submissions was that: the communications issue "These prosecutions concern communications which are offensive, not in respect of any political or government content properly the subject of the implied freedom, but offensive because of other content such as the personal attacks that are made upon the deceased in the circumstances of having been sent to the homes of the wives and families." (emphasis in original) The point was embellished by the proposition that a "communication must be directed at promoting political discussion" to come within the scope of the implied freedom. The distinction upon which these submissions depended – between communications "in respect of any political or government content properly the subject of the implied freedom" (emphasis added) and other aspects of the communication described as "the personal attacks that are made upon the deceased", which were said not to be in respect of any political or government content – is not validly drawn. The whole of each of the communications, including the attacks made on the deceased, was, both in form and in substance, a single communication about whether Australian forces should be engaged in Afghanistan. That subject was and is a matter of political controversy. The insults directed to the deceased were as much a part of the political nature of the communications as anything else that was said in them. The first respondent's contention should be rejected. Relief The first respondent submitted that if the appeals to this Court were to be allowed, this Court should not itself make such order as the Court of Criminal Appeal should have made but instead remit the matter to the District Court for further argument about whether "any statements in the [communications] are not protected by the implied freedom and available to support a charge". There is no sound reason shown for this Court not to dispose of the matter finally. Hayne It is neither necessary nor appropriate, however, to decide whether s 471.12, in its operation to an "offensive" use of a postal or similar service, can or should be read down or any parts of that section severed. The parties and many of the interveners referred to the possibility of reading down s 471.12 by reference to s 15A of the Acts Interpretation Act 1901 (Cth) and the approach of some of the members of the Court in Coleman v Power. But the substance of the orders which each appellant sought in this Court was only to quash the indictment in so much as it charged them regarding "offensive" uses of a postal service. And, although the first appellant sought a declaration of invalidity in his notice of appeal to the Court of Criminal Appeal, it is important to recall that these appeals arise out of motions to quash an indictment. In these circumstances, it is sufficient and appropriate only to quash the relevant parts of the indictment213. Accordingly there should be orders that each appeal to this Court is allowed. The orders of the Court of Criminal Appeal should be set aside and in their place there should be orders that (a) each appeal to that Court is allowed and (b) the orders of the District Court of New South Wales are set aside and in their place there is an order that the whole of the indictment preferred against Man Haron Monis and Amirah Droudis, except for the charge numbered 3 charging Man Haron Monis with using a postal service in a way that reasonable persons would regard as being, in all the circumstances, harassing, is quashed. 213 Compare, for example, the orders made in Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51; [1996] HCA 24. 234 HEYDON J. The circumstances are fully set out in other judgments. The appellants submit that s 471.12 of the Criminal Code (Cth) ("the Code") infringes the implied constitutional limitation on the extent of legislative power to burden freedom of communication about government and political matters. The submission raises three questions. The first question is: does s 471.12 effectively burden the freedom of communication about government or political matters? The second question is: is the offence reasonably appropriate and adapted to serve a legitimate end in a manner which is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government and the procedure prescribed by s 128 of the Constitution for submitting a proposed amendment to the Constitution to the informed decision of the people? And the third question is: should s 471.12 of the Code be read down so as to make it valid? In approaching those questions, it is necessary to proceed on the fundamental assumption that the implied freedom of communication about government or political matters is correctly identified and elucidated in the authorities of this Court214. Below that will be called "the fundamental assumption". The answer to the first question is "Yes" broadly for the reasons given by French CJ215. The answer to the second question is "No" broadly for the reasons given by French CJ216. As to the third question, s 471.12 should not be read down so as to make it valid217. It follows from these conclusions that it is beyond the legislative power of the Commonwealth to prohibit and punish conduct of the type underlying the charges in this case. The orders proposed by Hayne J and concurred in by French CJ should be made. That is an outcome so extraordinary as to cast doubt, and perhaps more than doubt, on the fundamental assumption and the chain of reasoning which led to it. There are various ways of describing the communications which found the alleged offences in this case. To say that they are letters addressed to the parents and relatives of deceased soldiers killed in active service in Afghanistan that reflect on the service of those deceased soldiers in that conflict is one way of 214 Running from Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106; [1992] HCA 45 to Wotton v Queensland (2012) 246 CLR 1; [2012] HCA 2. 215 Reasons of French CJ at [63]-[71]. 216 Reasons of French CJ at [72]-[74]. 217 Reasons of French CJ at [75]-[76], and of Hayne J at [232]. putting the matter. Another approach is to concentrate on the actual language of the communications, unmediated by bland summary. That approach is not inimical to the rights and interests of the appellants in their criminal trials. One of the communications, for example, is couched in unctuous expressions of regret for the "difficult time" through which the parents are passing, "condolences for the loss of your son" and statements like "May God grant you patience and guide us all to the right path." But it calls the son a murderer of civilians. It expresses sympathy to his parents, but not to him. It compares the son to a pig and to a dirty animal. It calls the son's body "contaminated". It refers to it as "the dirty body of a pig". It describes Hitler as not inferior to the son in moral merit. For most children, the death of a parent is a sad event. For most parents, the death of a child is worse. That is because many parents die when elderly, or at a great age when death comes as a blessed release. Parents of that kind have lived a full lifespan. But it is different when children die in their parents' lifetime. The natural order of events is reversed. The children have not fought their fight to finality. They have not run their full race. Yet when a child dies in battle, a parent's sadness is often assuaged by the feeling that the child's death was a necessary and meritorious sacrifice. Thus on 27 September 1915, in the course of the Battle of Loos, an 18 year old subaltern in the Irish Guards, who had experienced considerable difficulty in joining up because of bad eyesight, was shot through the head as his unit advanced. After a German counterattack, he was left behind. In due course he was posted missing, presumed dead. These events ruined the remaining years of his father, who wrote the following poem: "My Boy Jack 'Have you news of my boy Jack?' Not this tide. 'When d'you think that he'll come back?' Not with this wind blowing, and this tide. 'Has any one else had word of him?' Not this tide. For what is sunk will hardly swim, Not with this wind blowing, and this tide. 'Oh, dear, what comfort can I find!' None this tide, Nor any tide, Except he did not shame his kind – Not even with that wind blowing, and that tide. Then hold your head up all the more, This tide, And every tide; Because he was the son you bore, And gave to that wind blowing and that tide!" The parents and other relatives of those killed in war are likely to experience a similar mingling of sadness and pride. That feeling is liable to be disturbed when the parents or relatives receive communications of the kind on which the appellants' prosecutions are based. Perhaps not all parents or relatives would consider the communications underlying the charges with which these appeals are concerned offensive. The recipients may throw the communications away without a thought. They may find the communications to be de minimis when compared to the misery being experienced. Some recipients may have almost saintly capacities for forbearance and forgiveness. But many would not fall into these categories. Many would regard the communications as sadistic, wantonly cruel and deeply wounding blows during the most painful days of their lives. Legislators, the members of the Executive who are responsible to the legislators, and the people who elect the legislators, can claim a legitimate interest in procuring legislation which seeks to punish and prevent conduct of that kind. The offensiveness of remarks to and about political opponents, or politicians, may be a price to be paid for or an incidental side-effect of free speech. But offensive remarks of the kind alleged here are not within those categories. It was said that the primary objects of the appellants' alleged conduct were not the recipients of the letters, but the politicians who support Australian participation in the war as being in the national interest. Yet the offensive conduct is likely to be much more hurtful to the innocent relatives of the deceased soldiers than to the primary objects of attack. The result of the fundamental assumption on which these appeals were argued is to prevent the enactment of both federal legislation and State legislation to deal with the conduct. The law protects those within the Queen's peace from intentionally caused bodily harm. It protects them from emotional harm which is intentionally caused by a prank where the "act was so plainly calculated to produce some effect of the kind which was produced that an intention to produce it ought to be imputed to the defendant"218. Why cannot the law protect them from harm which is intentionally caused, not by a prank, but by a deadly serious allegation used as a political weapon calculated to produce emotional harm? It is true that the control of offensive conduct may be seen as an imprudent step for a legislature to take. But whether controlling offensive conduct is prudent is an entirely different question from whether it is right that the legislature should be impotent to take that step at all. There are many reasons for doubting the correctness of the fundamental assumption. A good many of those reasons were trenchantly developed in the powerful dissenting judgments of Dawson J in Australian Capital Television Pty Ltd v The Commonwealth219 and of Callinan J in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd220. They have also been developed by academic lawyers221. What follows is a miscellany of additional or overlapping points calling for inquiry if a challenge were ever to be made to the relevant authorities supporting the fundamental assumption. The implied freedom of political communication has never been clear. If there were a federal bill of rights, the implied freedom of communication about government and political matters would be listed. "Bills of rights are not moral or even political philosophies. They are, at best, bullet points from such philosophies."222 Like other philosophical bullet points, the unclarity of the implied freedom gives the courts virtually untrammelled power to make of it what each judge wills. 218 Wilkinson v Downton [1897] 2 QB 57 at 59 per Wright J. 219 (1992) 177 CLR 106 at 177-191. 220 (2001) 208 CLR 199 at 298-309 [251]-[277] and 330-339 [337]-[348]; [2001] HCA 63. 221 For example, Goldsworthy, "Constitutional Implications and Freedom of Political Speech: A Reply to Stephen Donaghue", (1997) 23 Monash University Law Review 362; Stone, "Freedom of Political Communication, the Constitution and the Common Law", (1998) 26 Federal Law Review 219; Stone, "The Australian Free Speech Experiment and Scepticism about the UK Human Rights Act", in Campbell, Ewing and Tomkins (eds), Sceptical Essays on Human Rights, (2001) 222 Robertson, The Judge as Political Theorist: Contemporary Constitutional Review, the provenance of Nor has the existence of the implied freedom enjoyed unanimous support. Its progenitor was in a minority of one until after his death. From this point of freedom has been viewed as implied view unsatisfactory223. It is notorious that there was marked division of opinion in the early cases. The statement of the implied freedom has varied in each case in which it has been considered – right up to the most recent case224. the The "reasonably appropriate and adapted test" is mysterious. The words "appropriate" and "adapted" mean the same thing. Something is "appropriate" if it is "[s]pecially fitted or suitable"225. Something is "adapted" if it is "[f]itted; fit, suitable."226 If an enactment is reasonably appropriate, why is it not reasonably adapted? If it is reasonably adapted, why is it not reasonably appropriate? What is the force of "reasonably"? It appears to point to a distinction between what is "unreasonably appropriate and adapted" and what is "reasonably appropriate and adapted" – but to call something unreasonably appropriate and adapted is to speak in self-contradictory terms. How does the application of so amorphous a test avoid the dangers of judicial legislation? Is the "reasonably appropriate and adapted" test an adequate explanation for all the exceptions to the implied constitutional limitation – the crime of perjury, the tort of deceit, the crimes of inciting or threatening violence, the crime of sedition and the tort of defamation? The former President of the Supreme Court of Israel, Aharon Barak, said227: "Most central of all human rights is the right to dignity. It is the source from which all other human rights are derived. Dignity unites the other human rights into a whole." Those observations have force. If so, why should a constitutional right be invented which is capable of injuring the right to dignity? An aspect of the right to dignity must be the right to be free from abuse after the loss of a loved one. The former President also said228: "Human dignity regards a human being as an end, not as a means to achieve the ends of others." Why should a freedom of political communication be implied into the Constitution when it permits persons like the appellants to disregard the relatives of soldiers as ends, and treat the infliction of pain on them only as a means of achieving their own ends? 223 Wotton v Queensland (2012) 246 CLR 1 at 18 [39]. 224 Wotton v Queensland (2012) 246 CLR 1 at 19 [41]. 225 The Oxford English Dictionary, 2nd ed (1989), vol I at 586 meaning 5. 226 The Oxford English Dictionary, 2nd ed (1989), vol I at 139 meaning 1. 227 The Judge in a Democracy, (2006) at 85 (footnotes omitted). 228 The Judge in a Democracy, (2006) at 86. It is sometimes suggested that even if the implied freedom did not originally exist – which it did not – it was necessary to invent it in order to ensure that representative democracy operated properly. It is hard to agree in view of the more than satisfactory operation of representative and responsible democracy in Australia for 50 years before Federation, and then for the period, more than 90 years long, between Federation and the invention of the implied freedom. Indeed, it is questionable whether the implied freedom does foster representative democracy. For Campbell and Crilly say229: "To date, the clear casualty of the matter has been the Australian democratic system. In particular, there is the ongoing failure to come to grips with the inequities and distortions of campaign finances, a realm in which there are vast political expenditures provided by individuals, corporations, unions and taxpayers, on a scale which, proportionate to the population's size, is amongst the highest in the world. This not only disregards the ideal of political equality central to democratic values, but also encourages methods of campaigning and propagandising which are rightly seen by their subjects as insultingly uninformative and non- argumentative, a type of political communication which is neither free nor inviting." A further line of questions would concern why a limited free speech protection should be implied into a Constitution the framers of which, after carefully examining the United States Constitution, deliberately decided not to transpose its First Amendment, either in whole or in part. Finally, doubt must attend Lange v Australian Broadcasting Corporation. The celebrated compromise achieved in that case underlies the modern law. But the detection of an opportunity to reach the compromise was unconvincing. Mr Lange was not an Australian politician but a New Zealander. What did discussion of him have to do with Australia? The Court said230: "By reason of matters of geography, history, and constitutional and trading arrangements, however, the discussion of matters concerning New Zealand may often affect or throw light on government or political matters in Australia." This may have been true in the very early 1890s, when New Zealand was a candidate for joining the Australian colonies in a federation and it was not clear 229 "The Implied Freedom of Political Communication, Twenty Years On", (2011) 30 University of Queensland Law Journal 59 at 78. 230 (1997) 189 CLR 520 at 576 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh, Gummow and Kirby JJ; [1997] HCA 25. what final form Australian unification would take. It is hard to see how it was true in the 1990s. For the most part, Australians know nothing of New Zealand affairs. The information which the Australian public does possess of New Zealand affairs is more likely to generate great public boredom, not interest. And what light can matters in a non-federal unicameral country throw on matters in a federal union of polities many of which are bicameral? Those who drafted the Constitution, those who secured legislative approval of it by each colonial legislature, and the people who approved it by their ballots would each say, if they could examine the authorities on the implied freedom of communication: "Non haec in foedera veni". Yet in compacts other than constitutions, clearness and obviousness are common conditions precedent to the implication of terms. Close examination of the implied freedom of political communication would involve analysis of these issues. That examination may reveal that it is a noble and idealistic enterprise which has failed, is failing, and will go on failing. That close examination cannot usefully take place until some litigant whose interests are damaged by the implied freedom argues in this Court, with leave if necessary, that the relevant authorities should be overruled. No endeavour of that kind was made in these appeals. Hence these appeals offered no occasion for close examination of the relevant questions. On the existing law, there is no alternative but to make the orders proposed by Hayne J – a result which, some may think, demonstrates how flawed that law is. CRENNAN, KIEFEL AND BELL JJ. The appellants were charged in a joint indictment with offences against s 471.12 of the Criminal Code (Cth) ("the Code"), which provides: "A person is guilty of an offence if: the person uses a postal or similar service; and the person does so in a way (whether by the method of use or the content of a communication, or both) that reasonable persons would regard as being, in all the circumstances, menacing, harassing or offensive." The appellant Man Haron Monis was charged with 12 counts of using a postal service in a way that reasonable persons would regard as being, in all the circumstances, offensive. The appellant Amirah Droudis was charged with eight counts of aiding and abetting the commission by Monis of those offences. Monis was further charged with using a postal service in a way which would be regarded as harassing. The charges against the appellants generally concern the sending of letters or a compact disc by Monis to the fathers, the wives or other relatives of Australian soldiers who had been killed whilst on active service Afghanistan231. The letters contained statements which were critical of the Australian government's role in maintaining troops in Afghanistan. Copies of some of the letters were sent to politicians. The appellants maintain that the letters constitute communications on political and governmental matters which are the subject of the implied freedom of communication on those matters, a freedom which Lange v Australian Broadcasting Corporation232 ("Lange") holds to be an indispensable incident of the system of representative government created by the Constitution. The appellants' letters have another dimension. Whilst they open with expressions of sympathy for the grieving family member or members to whom they are addressed, if the recipients read on, they are confronted with accusations that the dead soldier was a murderer of innocent civilians and children and, in some cases, was to be likened to Hitler. The question whether reasonable persons would regard the content of these communications as being, in all the 231 Two of the charges arose out of a letter sent to the mother of an Austrade official killed in the bombing of the J W Marriott Hotel in Indonesia in July 2009. 232 (1997) 189 CLR 520 at 559; [1997] HCA 25. circumstances, offensive, within the meaning of that term in s 471.12, is not a matter which falls to be determined upon these appeals. That may be a matter to be determined by a jury, depending upon the outcome of these appeals. The question raised for the Court by these appeals concerns the constitutional validity of s 471.12, given that its operation is likely to inhibit some communication on political or governmental matters to as "political communication") which is the subject of the implied freedom of communication. (hereafter referred By notices of motion filed in the District Court of New South Wales, the appellants sought to have the indictments quashed on the basis that s 471.12 is invalid. Tupman DCJ found that the letters were capable of being characterised as political communication233. Whether that is a correct characterisation of the letters is not an issue on these appeals. For the purposes of these appeals it may be accepted that s 471.12 may have the effect of inhibiting some offensive communications of a political character. Tupman DCJ, however, dismissed the motions234. The Court of Criminal Appeal of the Supreme Court of New South Wales (Bathurst CJ, Allsop P and McClellan CJ at CL) dismissed the appellants' appeals from those orders235. The appeal by Monis with respect to the charge of using a postal service in a harassing way was abandoned. Section 471.12 An offence of the kind in question is not new. The Post and Telegraph Act 1901 (Cth) prohibited the sending of articles having "thereon or therein or on the envelope or cover thereof any words, marks or designs of an indecent, obscene, blasphemous, libellous or grossly offensive character"236. That Act was repealed in 1975. Regulation 53 of the regulations made under the Postal Services Act 1975 (Cth) proscribed the sending, by post or courier service, of an article consisting of matter which advised, notified or advertised the existence or availability of matter "of an indecent, obscene or offensive nature". It may be observed that the words "libellous" and "blasphemous" were omitted and "grossly" was no longer maintained as a description of the requisite degree of 233 R v Monis (2011) 12 DCLR (NSW) 266 at 270 [14]. 234 R v Monis (2011) 12 DCLR (NSW) 266 at 278 [53]. 235 Monis v The Queen (2011) 256 FLR 28 at 44 [69], 50 [92], 55 [120]. 236 Post and Telegraph Act 1901 (Cth), s 107 (punctuation added). offensiveness. The regulation also required, for the offence to be made out, that the matter not have been solicited by the person to whom it was sent. Section 85S was introduced into the Crimes Act 1914 (Cth) in 1989237. It created an offence of knowingly or recklessly using a postal or carriage service supplied by Australia Post: "to menace or harass another person"; or "in such a way as would be regarded by reasonable persons as being, in all the circumstances, offensive." In 2002, the Criminal Code Amendment (Anti-hoax and Other Measures) Act 2002 (Cth) repealed s 85S and enacted s 471.12, which appears in Ch 10 (entitled "National infrastructure"), Pt 10.5 ("Postal services"), Div 471 ("Postal offences"), Subdiv A ("General postal offences") of the Code. Section 471.12 as enacted was in substantially the same terms as the current provision, except for the words which now appear in parentheses, "(whether by the method of use or the content of a communication, or both)", which were added in 2005238. Section 471.12 applies to the use of a "postal or similar service", which is defined239 to include courier services and packet or parcel carrying services. Australia Post has the exclusive right to carry letters by post in Australia240. The 2002 amendments create offences of using a postal or similar service in a way that is "menacing", "harassing" or "offensive". The focus in these appeals is upon an offensive use of a postal service but, as will be explained, in the context of s 471.12 this involves more than the mere causing of offence to a recipient. This is evident from the text which precedes the word "offensive", and from the history and purposes of these types of provisions as explained below. Further, whilst an offensive use may arise from the content of a communication, this should not detract attention from the method of the use as relevant under s 471.12. In either case, the standard to be applied to the use under s 471.12 is 237 By the Telecommunications and Postal Services (Transitional Provisions and Consequential Amendments) Act 1989 (Cth), s 5. 238 Crimes Legislation Amendment (Telecommunications Offences and Other Measures) Act (No 2) 2004 (Cth), Sched 1, item 7. 239 Criminal Code (Cth), s 470.1. 240 Australian Postal Corporation Act 1989 (Cth), s 29. the view of a reasonable person taking into account all the relevant circumstances. The penalty provided for the abovementioned offences has varied over the years. When s 471.12 was enacted, the maximum fine was increased to $13,200 for an offence committed by a person and $66,000 for a corporation241. The maximum term of imprisonment which could be applied was increased from one to two years. Earlier predecessors to s 471.12 also provided for imprisonment as a possible penalty. An offence in terms similar to s 471.12 is contained in s 474.17. It appears in Ch 10 of the Code, Pt 10.6 ("Telecommunications Services"), Div 474 ("Telecommunications offences"), Subdiv C ("General offences relating to use of telecommunications"). It creates an offence of using a carriage service242 in a way "that reasonable persons would regard as being, in all the circumstances, menacing, harassing or offensive." A point of difference between s 471.12 and s 474.17 is in the application of s 473.4, which lists certain matters to be taken into account in determining whether reasonable persons would regard particular material, or a particular use of a carriage service, as being, in all the circumstances, offensive. Those matters include "the general character of the material", and "the standards of morality, decency and propriety generally accepted by reasonable adults"243. However, s 473.4 is expressed to apply for the purposes of Pt 10.6 of the Code. It is not said to apply to Pt 10.5. Section 474.17 was enacted two years after s 471.12244, at the same time that s 473.4 was 241 Crimes Act 1914 (Cth), ss 4AA, 4B as at 1 January 2004 (Reprint No 9) incorporating amendments pursuant to the Criminal Code Amendment (Anti-hoax and Other Measures) Act 2002 (Cth). 242 "Carriage service" is defined in the Dictionary of the Code by reference to the Telecommunications Act 1997 (Cth), s 7 of which defines the term as a service for carrying communications by means of guided or unguided electromagnetic energy. "Internet carriage service" is separately defined in the Telecommunications Act 243 It was explained, upon the introduction of s 473.4, that the factors listed are some of the matters which are required to be considered by the Classification Board under the Classification (Publications, Films and Computer Games) Act 1995 (Cth): Australia, House of Representatives, Crimes Legislation Amendment (Telecommunications Offences and Other Measures) Bill (No 2) 2004, Explanatory Memorandum at 14. 244 Crimes Legislation Amendment Measures) Act (No 2) 2004. (Telecommunications Offences and Other inserted into the Code. No issue arises in these proceedings concerning the matters contained in s 473.4, nor as to the operation of s 474.17. It may be observed that many of the matters raised for consideration by s 473.4 would be taken into account in the application of the reasonable person standard in Laws prohibiting communications containing offensive and other like matter by use of the postal service have been in existence for some time in other countries. The offence created by the Post and Telegraph Act 1901 was in terms similar to that in the Post Office (Protection) Act 1884 (UK)245. This and subsequent legislation246 made it an offence to send a postal packet which contained an indecent or obscene article. Section 1(1) of the Malicious Communications Act 1988 (UK) prohibits the sending of a letter, electronic communication or article which is "indecent or grossly offensive" if the sender's purpose is to cause distress and anxiety to the recipient or any other person to whom it is intended its contents should be communicated247. The enactment of the offence followed the recommendation of the Law Commission in its report on poison-pen the Law Commission's reasons for recommending a new statutory offence was the recognition that poison-pen letters may not be defamatory249 and may not contain threats of a kind that would expose the writer to criminal sanction250. The Law Commission instanced the sending of a letter to a married woman falsely stating that her husband, abroad on a business trip, had been killed251. letters248. Among 245 Section 4(1)(b), (c). 246 Post Office Act 1953 (UK), s 11(1)(b); Postal Services Act 2000 (UK), s 85(3). 247 In addition, the Communications Act 2003 (UK) prohibits the use of a public electronic communications network to send matter which is of a grossly offensive, indecent, obscene or menacing character: s 127(1). 248 The Law Commission, Criminal Law: Report on Poison-Pen Letters, Law Com No 147, (1985) at 32 [5.1]-[5.5]. 249 The Law Commission, Criminal Law: Report on Poison-Pen Letters, Law Com No 147, (1985) at 4 [2.5]. 250 The Law Commission, Criminal Law: Report on Poison-Pen Letters, Law Com No 147, (1985) at 5-6 [2.11]. 251 The Law Commission, Criminal Law: Report on Poison-Pen Letters, Law Com No 147, (1985) at 9 [3.1]. Section 85 of the Postal Services Act 2000 (UK) creates the offences of, inter alia, posting a packet exhibiting or containing any indecent or obscene material or article. Under s 22 of the Postal Services Act 1998 (NZ), a person who posts an indecent article with the intention of offending the recipient is guilty of an offence. The use of a telephone device to make a profane, indecent or obscene communication, where it is intended to offend the recipient252, is an offence under s 112(1) of the Telecommunications Act 2001 (NZ). In the United States, laws prohibit the use of communication services to distribute obscene or indecent material253. The provision of some form of legislative protection to citizens against the receipt of material through the post which is grossly offensive, offensive, obscene or indecent has a long history in Australia and in other representative democracies. In each of the other jurisdictions mentioned, laws are tested for their validity against entrenched personal rights of freedom of speech254. The freedom implied by the Australian Constitution does not provide such a right; rather, it operates as a constraint upon legislative power255. The question is whether, given its object and the means by which it is sought to be achieved, s 471.12 can be said to be a valid exercise of Commonwealth legislative power. 252 As to the fault element of recklessness, knowledge or intention with respect to s 471.12 see [341] of these reasons. 253 18 USC §§1461-1464, 1468. 254 In the United Kingdom by reference to Art 10 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1950); in New Zealand by s 14 of the New Zealand Bill of Rights Act 1990; and in the United States by the First Amendment to the Constitution. 255 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 150, 168; [1992] HCA 45; Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 125, 149, 162, 166; [1994] HCA 46; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 326; [1994] HCA 44; Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560; Hogan v Hinch (2011) 243 CLR 506 at 554 [92]; [2011] HCA 4. Similarly in relation to the s 92 freedom, see James v The Commonwealth (1939) 62 CLR 339 at 361-362; [1939] HCA 9; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 56, 59, 76; [1992] HCA 46. The implied freedom – the test in Lange The implied freedom was recognised in Australian Capital Television Pty Ltd v The Commonwealth256 ("ACTV") and in Nationwide News Pty Ltd v Wills257 ("Nationwide News"). In ACTV, the freedom was identified as essential to the maintenance of representative government for which the Constitution makes provision258. Neither those decisions, nor Cunliffe v The Commonwealth259 and Leask v The Commonwealth260, which followed, explained how it might be determined whether a law which denied or restricted the implied freedom was invalid. The question necessarily arose because it was accepted that the implied freedom was not absolute261. The same observation had been made concerning the freedom which finds expression in s 92 of the Constitution262. A law is not invalid merely because its operation effects some restriction upon political communication the subject of the implied freedom or upon the freedom of interstate trade and commerce with which s 92 is concerned. 256 (1992) 177 CLR 106. 257 (1992) 177 CLR 1. 258 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 140 per Mason CJ, 174 per Deane and Toohey JJ. 259 (1994) 182 CLR 272. 260 (1996) 187 CLR 579; [1996] HCA 29. 261 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 76-77, 94-95; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 142-144, 159, 169, 217-218; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 299, 262 W & A McArthur Ltd v State of Queensland (1920) 28 CLR 530 at 567-568 per Gavan Duffy J; [1920] HCA 77 (referred to with approval in Cole v Whitfield (1988) 165 CLR 360 at 395-396; [1988] HCA 18); The Commonwealth v Bank of NSW (1949) 79 CLR 497 at 639; [1950] AC 235 at 309-310; North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 581 per Barwick CJ, 607-608, 614-615 per Mason J, 620-621 per Jacobs J; [1975] HCA 45; Uebergang v Australian Wheat Board (1980) 145 CLR 266 at 281-282 per Barwick CJ; [1980] HCA 40; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 472 per Mason CJ, Brennan, Deane, Dawson and Toohey JJ; [1990] HCA 1; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 54, 56 per Judgments in ACTV and in Nationwide News spoke in the language of proportionality. To an extent, such an analysis had been utilised in cases involving s 92 of the Constitution263. In North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW264, Mason J said that the regulation there in question was not shown to be necessary to the legislative object of the protection of public health and was, therefore, not a reasonable regulation of interstate trade in pasteurised milk265. The test of "reasonable necessity" was later adopted as a doctrine of the Court in Betfair Pty Ltd v Western Australia266. It was said to be consistent with the acceptance in Cole v Whitfield267 that the total prohibition in Tasmanian legislation on the sale of undersized crayfish was necessary for the protective purpose there concerned. The legislation at issue in Nationwide News made it an offence to use words, in writing or in speech, which were calculated to bring a member of the Industrial Relations Commission into disrepute. Freedom of communication about government institutions was thereby restricted. The judgments spoke of the lack of need for, or reasonableness of, the level of protection provided by the to be unnecessary and legislation. the that was "grossly law referred disproportionate to [its] need" and an "extraordinary intrusion" upon the implied freedom269. Deane and Toohey JJ considered that the legislation went far beyond what was reasonably necessary270 and Brennan J identified a lesser restriction that could have been effected271. legislation to a 263 Uebergang v Australian Wheat Board (1980) 145 CLR 266 at 303-307; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 472, 473-474. 264 (1975) 134 CLR 559. 265 North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 266 (2008) 234 CLR 418 at 477 [102]-[103]; [2008] HCA 11. 267 (1988) 165 CLR 360 at 409-410. 268 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 34. 269 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 101. 270 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 78. 271 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 53. ACTV concerned prohibitions and restrictions affecting broadcasting of political advertisements in election periods. Views were expressed in the judgments that the prohibitions went beyond what was reasonably necessary to achieving the aim of preventing corruption272, and that they could not be regarded as reasonable and appropriate273. Other considerations, relevant to whether a law impermissibly restricts the implied freedom, are evident from some of the judgments. In ACTV, Mason CJ was inclined to analyse the kinds of restrictions effected on communications274, and the nature of the interests sought to be protected by the freedom. Both Mason CJ and McHugh J spoke of the different levels of justification required for different kinds of restrictions275. It may be said that in the cases which followed Nationwide News and ACTV, the use of proportionality analysis appears to have been somewhat more restricted276. It is not necessary to survey those cases. In Lange, the Court articulated a test to be applied to determine whether a law infringes the implied freedom277 and in that process it drew upon aspects of ACTV. Some statements of the test in Lange may be thought to require further explication. These appeals necessitate particular attention to the requirements of the test as expressed in Lange. In Lange it was explained that the system of representative government which is provided for by the Constitution requires that members of the Houses of Parliament be "directly chosen by the people". Because there is a choice to be exercised, legislative power cannot support an absolute denial to the people of access to information relevant to that choice. Sections 7 and 24 of the 272 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 174 per Deane and Toohey JJ. 273 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 221 per Gaudron J; see also at 146-147 per Mason CJ. 274 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 143 per Mason CJ, 234-235 per McHugh J. 275 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 143 per Mason CJ, 235 per McHugh J. 276 See Zines, The High Court and the Constitution, 5th ed (2008) at 61-62. 277 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567. Constitution do not, however, confer personal rights on individuals; rather they preclude the curtailment of the protected freedom by the exercise of legislative or executive power278. Lange repeated what had earlier been said, namely that the implied freedom is not absolute, and said that it is limited to what is necessary for the effective operation of that system of representative government provided for by the Constitution279. Whilst recognising that the implied freedom operates as a restriction on legislative power, Lange held that a law will not be invalid if it is enacted to meet some other legislative end, so long as it satisfies two conditions280. The first condition was stated to be: "that the object of the law is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government". The second condition was that: "the law is reasonably appropriate and adapted to achieving that legitimate object or end." Reference was also made at this point in the reasons to how a test for infringement of the implied freedom might be expressed. It might be said to be "whether the law is reasonably appropriate and adapted to the fulfilment of a legitimate purpose", or it could be described as a test of proportionality. There was not considered to be a relevant distinction between these formulations. The Court stated the test281 to be applied in determining whether a statute infringes the freedom later in its reasons. "The Lange test", as subsequently modified282, is in these terms: 278 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 559-560. 279 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561. 280 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562. 281 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567. 282 Coleman v Power (2004) 220 CLR 1 at 50 [93], 51 [95]-[96] per McHugh J, 78 [196] per Gummow and Hayne JJ agreeing; [2004] HCA 39; Hogan v Hinch (2011) 243 CLR 506 at 542 [47]; see also Wotton v Queensland (2012) 246 CLR 1 at 15 [25], 30 [77], 31-32 [82]; [2012] HCA 2. First, does the law effectively burden freedom of communication about government or political matters either in its terms, operation or effect? Second, if the law effectively burdens that freedom, is the law reasonably appropriate and adapted to serve a legitimate end in a manner which is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government? Some observations are necessary respecting the Lange test as stated. It will be observed that there are two objects spoken of. In the reference to the conditions for validity, which were earlier stated, the first object or the "legitimate end" is the maintenance of the constitutionally prescribed system of government. In the reference which followed to a possible test for infringement and in the Lange test itself, it is said to be necessary that a law be reasonably appropriate and adapted to serve "a legitimate purpose" or "a legitimate end". Here reference is made to the second object, the impugned law's own object. That end, and the means by which it is sought to be achieved, must be compatible with the aforementioned constitutional imperative of the maintenance of the prescribed system of representative government. It may then be observed that two tests are involved: one of compatibility with the constitutional imperative of the maintenance of representative government, or the freedom which supports it; and one of proportionality (or whether the law is "reasonably appropriate and adapted"). And it is necessary to bear in mind, by reference to the conclusion reached in Lange, that an enquiry into whether the burden imposed by the law upon the implied freedom is too great or "undue"283 is necessarily addressed. The relative succinctness with which the test is stated in Lange should not mislead. What has been referred to as the second limb of the Lange test, read with other statements in Lange, may be seen to involve a series of different enquiries. The first enquiry concerns the relationship between a valid legislative object and the means adopted for its attainment. The latter must be "reasonably appropriate and adapted", or proportionate, to that object. The reference in Lange284 to the example of ACTV confirms the applicability of such a test. As was observed in Lange, the law was held to be invalid in ACTV because there were clearly other, less drastic, means by which the objectives of the law could 283 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568-569, 284 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568. have been achieved. Thus if the means employed go further than is reasonably necessary to achieve the legislative object, and are disproportionate to it, invalidity may result. This brings to mind the test of reasonable necessity stated in Betfair Pty Ltd v Western Australia285. In such a case it would follow that the burden imposed upon the freedom could not be justified, even if it were not great. Even if the ends and means of the impugned legislation are in proportion, the second limb of the Lange test requires that they each be tested for compatibility with the constitutional imperative of the maintenance of the system of representative government. It will be a rare case where a conclusion of outright incompatibility will be reached and, where it is, it will be by reference to the object of the legislation. In most cases, the question of incompatibility will involve examining the extent of the effect of the legislative restrictions upon the communications the subject of the implied freedom which supports the maintenance of that system of government. What is not clearly expressed in the second limb of the test is what appeared in the earlier statement relating to the two conditions for validity, namely that the law must also be proportionate, or reasonably appropriate and adapted, to the first object of maintaining representative government. This enquiry involves the relationship between that object and the means employed by the legislation. It is tested by assessing the extent of the restriction imposed upon political communication, the subject of the freedom. This enquiry is evident in the conclusion reached in Lange that the law of defamation did not impose an "undue burden" on the freedom286. It reflects what was said by Brennan J in Nationwide News287 in connection with s 92, namely that s 92 invalidates a law in so far as it imposes an impermissible burden on a protected interstate transaction. That the enquiry is as to the effect of the impugned law on a constitutionally protected freedom is confirmed by Cole v Whitfield288, where the question was stated as being whether the burden so disadvantaged interstate trade as to raise a protective barrier around Tasmanian trade in crayfish. 285 (2008) 234 CLR 418 at 479 [110]; and see Rowe v Electoral Commissioner (2010) 243 CLR 1 at 135-136 [443] per Kiefel J; [2010] HCA 46. 286 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568-569, 287 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 56. 288 (1988) 165 CLR 360 at 409. These tests or enquiries involve proportionality analysis. It was said on more than one occasion in Lange that there was no difference between the concept reflected in the words "reasonably appropriate and adapted" and the test of proportionality289. So much had earlier been suggested in Cunliffe v The Commonwealth290. In Roach v Electoral Commissioner it was said291 that what upon close scrutiny is disproportionate or arbitrary may not answer the description "reasonably appropriate and adapted". This raises the question whether the use of this more cumbersome and inexact phrase should be continued. That question will be discussed later in these reasons. Lange itself was concerned, not with statute law, but with the common law rules of defamation in New South Wales, which were required to conform to constitutional requirements292. The purpose of the law, of protecting reputation, was not regarded as incompatible with the implied freedom or the system of representative government it serves. It was said that the constitutionally prescribed system of government did not require that there be an unqualified freedom to publish defamatory matter293. The problem with the common law as developed prior to Lange was that it operated to restrict publication of political communication without providing a defence of qualified privilege in the circumstance of a wide publication. The Court extended that defence. Once the law was developed in this way, the Court was able to conclude that, having regard to the need to protect reputation, the law of defamation went no further than was reasonably appropriate and adapted to achieve that object. Whilst it placed something of a burden on the implied freedom, it did not create an "undue burden"294. 289 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 562, 567 290 (1994) 182 CLR 272 at 296-297, 300, 324, 339-340, 377. 291 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85] per Gummow, Kirby and Crennan JJ; [2007] HCA 43. 292 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 556. 293 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568. 294 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568-569, Arguments in these appeals focus largely upon the approaches taken in the later case of Coleman v Power295. The problem with the statutory provision there in question, so far as concerned the Lange test, was that on one view of its language and purpose, it would operate too widely in its restriction upon statements made in a public place and therefore upon political communication. In some of the judgments the provision was construed so as to restrict its sphere of operation, with the result that it met the Lange test. That approach has particular relevance to these appeals. The wide view of s 471.12 and the Lange test The word "offensive" in s 471.12 relevantly characterises the contents of a communication which is made using a postal service. It is a relative term, capable of referring to material ranging in degree of offensiveness. The section applies an objective standard, namely that of a reasonable person, and enquires whether that person would regard the use of the postal service in all the circumstances as offensive. The inclusion of an objective standard is not unimportant to the question whether the section goes further than is reasonably necessary, in the sense discussed in Lange. An objective standard operates to limit communications which may fall within s 471.12. The enquiry under s 471.12 is not merely whether the recipient is offended, but whether the content of the communication or the method of sending it is offensive, judged by that objective standard. That standard does not elucidate what is to be taken as offensive for the purposes of the section and, in particular, what degree of offensiveness is required; however, the technique of applying an objective standard to answer a question is familiar in the law. The legislative history, context and purpose of s 471.12 may assist in determining this question of construction. So too may other relevant principles of construction, which may require that the provision be read down. For present purposes it may be accepted that, at the lower end of the range, an offensive communication might refer to a communication which might cause upset to a person. A communication may be said to be offensive if it is capable of causing mere insult or hurt to a person's feelings. The judgments in the Court of Criminal Appeal implicitly accept that if the meaning of "offensive" in s 471.12 extends to communications of this nature, at the lower end of the spectrum of offensiveness, then s 471.12 cannot pass the 295 (2004) 220 CLR 1. second limb of the Lange test. Stated in terms of the conclusion reached in Lange, it would have too far-reaching an effect on communications of the kind protected by the implied freedom and would therefore unduly burden it. The primary judge and all members of the Court of Criminal Appeal adopted a restricted meaning of the term "offensive" in s 471.12 with the result that the section would apply to a smaller number of cases, where the degree of offensiveness might be said to be at the higher end of the spectrum296. The appellants submit that that meaning is not open and that any construction of s 471.12 must be consistent with the ordinary meaning of the word "offensive". By "ordinary", the appellants may be taken to refer to the widest meaning of the word, extending to the lowest degree of offensiveness. The appellant Droudis' submission proceeds by reference to Coleman v Power297. It is submitted that a majority there held that a law prohibiting the use of "insulting" words in a public place will only be valid in conformity with the test in Lange if the offence it creates refers to the use of insulting words which are intended, or likely, to cause a breach of the peace by provoking some unlawful physical retaliation from the person to whom the words are directed or some other person who hears them. It is submitted that, in that process, that same majority rejected a meaning of "insulting" which comprehends mere injury to a person's feelings. So wide a construction would be consistent with a legislative purpose of ensuring the civility of discourse in public. A law operating so widely upon political communication could not meet the Lange test298. The appellants seek to apply such reasoning to the words "offensive communications". On their argument, the term "offensive" cannot, on its ordinary meaning, be read other than as affecting a person's feelings. By analogy, Coleman v Power concludes the Lange test against the validity of Section 7(1)(d) of the Vagrants, Gaming and Other Offences Act 1931 (Q) made it an offence to use "threatening, abusive, or insulting words" in a public 296 Monis v The Queen (2011) 256 FLR 28 at 39 [44], 48 [83], 54-55 [116]-[118]; R v Monis (2011) 12 DCLR (NSW) 266 at 272 [24]. 297 (2004) 220 CLR 1. 298 Coleman v Power (2004) 220 CLR 1 at 78-79 [199]. place. The appellant in Coleman v Power was convicted of, inter alia, using insulting words contrary to that Act. The words were to be found in a statement made by the appellant to a police officer, whom the appellant publicly accused of being corrupt. A majority of the Court (McHugh, Gummow, Kirby and Hayne JJ; Gleeson CJ, Callinan and Heydon JJ dissenting) held that the conviction should be set aside. The submission for the appellant Droudis relies upon an argument that the same majority held that a word as far-reaching in operation as "insulting" can never pass the Lange test unless it is capable of being read down. The word "insulting" shares the same problem as the word "offensive" with respect to its intended operation in a statute creating an offence, in that they both describe statements which range in the severity of their effect. In Coleman v Power, Gleeson CJ drew a direct analogy between the two words299. Gummow and Hayne JJ held that if one construed the words "abusive or insulting" to encompass insults which are merely calculated to hurt the feelings of a person, the impugned provision could not satisfy the test in Lange300. Kirby J considered that an unqualified offence of expressing insulting language in a public place would be intolerably over-wide and difficult to characterise as a law meeting the Lange test301. Gummow and Hayne JJ considered it to be of some significance to the limit to be applied in interpreting the word "insulting" that, although the maximum fine by way of penalty for the offence was relatively small, a person could be imprisoned for six months302. Their Honours posed the question as to what it was that rendered the public utterance of insulting words a matter for criminal punishment and said that the answer must lie in the characteristics the insult must have303. Their Honours held that, in the context of the provision, the words "abusive" and "insulting" should be understood as words which, in the circumstances in which they are used, are so hurtful as to either be intended to, or be reasonably likely to, provoke unlawful physical retaliation304. Kirby J agreed 299 Coleman v Power (2004) 220 CLR 1 at 25 [13]. 300 Coleman v Power (2004) 220 CLR 1 at 78-79 [199]. 301 Coleman v Power (2004) 220 CLR 1 at 91 [237], [239]. 302 Coleman v Power (2004) 220 CLR 1 at 73 [177]-[178]. 303 Coleman v Power (2004) 220 CLR 1 at 76 [189]. 304 Coleman v Power (2004) 220 CLR 1 at 77 [193]. with that interpretation, dealing as it did with extreme conduct305. Construed in this way, Gummow and Hayne JJ held, s 7(1)(d) was reasonably appropriate and adapted to serve the legitimate end of keeping public places free from violence306. McHugh J did not read the offence as narrowly so as to be directed to preventing a breach of the peace. His Honour gave consideration to that purpose, because it was one of the justifications put forward in argument in favour of the validity of the statutory provision. He accepted that such a purpose would be compatible with a system of representative government307. However, his Honour's concern was that the prohibition was unqualified so that, even if it were addressed to that purpose, it went beyond what was reasonably appropriate and adapted to prevent breaches of the peace308. In the result, his Honour was prepared to excise that part of the provision which proscribed the use of insulting words in discussing political and governmental matters in or near a public place309, but his Honour did not adopt the constructional approach of the other three majority Justices. Gleeson CJ paid close attention to the meaning to be given to "abusive" and "insulting words" within the provision. However, his Honour did so by reference to the meaning to be given to the words in the context, and given the evident purpose, of the legislation. His Honour does not appear to have considered that an offence postulated on the likelihood of retaliation was comprehended by the provision. His Honour observed that "a group of thugs who, in a public place, threaten, abuse or insult a weak and vulnerable person may be unlikely to provoke any retaliation, but their conduct, nevertheless, may be of a kind that Parliament intended to prohibit."310 In his Honour's view, s 7(1)(d) extended to insulting words intended or likely to provoke a forceful response, but it was not limited to that circumstance. To come within the provision the language must not merely be derogatory; it must be such that its use, in the place where it is spoken and in the context of to whom it is spoken, is 305 Coleman v Power (2004) 220 CLR 1 at 98 [254], 98-99 [256]. 306 Coleman v Power (2004) 220 CLR 1 at 78 [198]. 307 Coleman v Power (2004) 220 CLR 1 at 53 [102]. 308 Coleman v Power (2004) 220 CLR 1 at 53-54 [102]. 309 Coleman v Power (2004) 220 CLR 1 at 56 [110]. 310 Coleman v Power (2004) 220 CLR 1 at 25 [12]. contrary to contemporary standards of good public order and goes beyond what, by those standards, is simply an exercise of the freedom to express opinions311. No comprehensive statement of the circumstances in which the use of language in a public place will involve such a disturbance of public order, or such an affront to contemporary standards of behaviour, as to constitute the contemplated offence, was possible312. In reasoning to this conclusion, Gleeson CJ referred313, it would seem with approval, to what was said in Ball v McIntyre314, where the word "offensive" appeared together with the words "threatening", "abusive" and "insulting" in a statutory provision creating an offence. The word "offensive" was held to convey the idea of behaviour likely to arouse significant emotional reaction. It was said in that case that what must be involved is an emotional reaction, such as anger, resentment, disgust or outrage315. It is therefore not correct to say, as the appellant Droudis does, that a majority in Coleman v Power held that the validity of the provision in question depended upon the offence being restricted in its operation to refer to the likelihood that insulting words might provoke violence. Nevertheless it may be accepted that a majority of the Court considered it necessary that the words "abusive" and "insulting" be given a restricted meaning, if the operation of the provision in question was not to be too wide in its effect upon political communication and thus fail to meet the test in Lange. Gummow and Hayne JJ considered that, on the wider construction of the provision, the relevant legislative purpose of prohibiting abusive or insulting language could only be to ensure civility of discourse316. It may be observed that Gleeson CJ did not consider the legislative purpose to be so limited and indicated that it extended to the maintenance of public order317. It may be inferred from his Honour's reference to Ball v McIntyre that his Honour considered that "abusive" and 311 Coleman v Power (2004) 220 CLR 1 at 26 [14]. 312 Coleman v Power (2004) 220 CLR 1 at 26 [15]. 313 Coleman v Power (2004) 220 CLR 1 at 25-26 [13]. 314 (1966) 9 FLR 237. 315 Ball v McIntyre (1966) 9 FLR 237 at 243. 316 Coleman v Power (2004) 220 CLR 1 at 78-79 [199]. 317 Coleman v Power (2004) 220 CLR 1 at 26 [14], 32 [32]. "insulting" words were to be interpreted as those capable of creating a stronger emotional reaction than mere hurt feelings. The Court of Criminal Appeal in these matters took a similar approach to the construction of s 471.12. In any event, the true relevance of Coleman v Power to these appeals is not what might be gleaned from that case as to the meaning to be given to the word "insulting", which, like the word "offensive", may be problematic in statements of what constitutes a criminal offence on any view. It is what principles of construction were there engaged, and how they might be applied here to s 471.12. The central issue in the process of construction is whether the offence in s 471.12 can be read as restricted in its operation to refer only to communications of a higher degree of offensiveness, so that it can satisfy the Lange test. The construction of s 471.12 The reasons of the Court of Criminal Appeal Attention was directed to the meaning of the word "offensive" in earlier decisions of courts in Australia, including Ball v McIntyre. As Bathurst CJ observed, although those cases were decided before the implied freedom was recognised by this Court, the courts were astute to interpret provisions restricting or prohibiting offensive language or communications so that they did not unduly restrict political debate318. Ball v McIntyre319 involved the political behaviour of a person who, in protesting against the Vietnam War, had sat and stood on parts of a memorial statue to King George V and hung a placard upon it. Kerr J observed that while certain improper conduct might be hurtful and cause people to be offended, it may not be "offensive" within the meaning of the statute. The purpose of a charge of offensive behaviour is not to punish those who differ from the majority320. To be offensive, behaviour would normally "be calculated to wound the feelings, arouse anger, resentment, disgust or outrage in the mind of a 318 Monis v The Queen (2011) 256 FLR 28 at 38 [35]; and see in this regard R v Burgmann unreported, New South Wales Court of Criminal Appeal, 4 May 1973 per Reynolds JA. 319 (1966) 9 FLR 237. 320 Ball v McIntyre (1966) 9 FLR 237 at 241; see also Worcester v Smith [1951] VLR reasonable man."321 The words "threatening, abusive and insulting" were all words, in his Honour's view, which "carry with them the idea of behaviour likely to arouse significant emotional reaction"322. Bathurst CJ concluded that for the use of a postal service to be offensive within the meaning of s 471.12, "it is necessary that the use be calculated or likely to arouse significant anger, significant resentment, outrage, disgust, or hatred in the mind of a reasonable person in all the circumstances. However, it is not sufficient if the use would only hurt or wound the feelings of the recipient, in the mind of a reasonable person."323 Allsop P, whilst accepting the definition proposed by Bathurst CJ324, suggested a further restriction, namely that to be offensive, the communication must be capable of causing "real emotional or mental harm, distress or anguish to the addressee."325 In reaching his conclusion, Bathurst CJ took into account a number of factors. In the first place, a possible penalty of imprisonment for two years is significant and suggests that the conduct to which the offence is directed carries a greater degree of criminality than conduct dealt with in legislation concerning some summary offences326. The word "offensive" is used in conjunction with "menacing" and "harassing" in s 471.12. This suggested to his Honour that the word "offensive" is directed to conduct more serious than using the postal service to hurt or wound the feelings of a recipient327. It was also necessary, in his involved Honour's view, communications occurring in private. It would be unlikely that the legislature intended to a great deal of private correspondence328. His Honour did not consider that the test of a reasonable the sanction should attach that s 471.12 into account the fact take that 321 Ball v McIntyre (1966) 9 FLR 237 at 243, referring to Worcester v Smith [1951] VLR 316 at 318. 322 Ball v McIntyre (1966) 9 FLR 237 at 243. 323 Monis v The Queen (2011) 256 FLR 28 at 39 [44]. 324 Monis v The Queen (2011) 256 FLR 28 at 50 [91]. 325 Monis v The Queen (2011) 256 FLR 28 at 50 [89]. 326 Monis v The Queen (2011) 256 FLR 28 at 39 [39]-[40]. 327 Monis v The Queen (2011) 256 FLR 28 at 39 [42]. 328 Monis v The Queen (2011) 256 FLR 28 at 39 [41]. person was relevant to the meaning of the word "offensive", but considered it relevant to the Lange test329. In construing s 471.12, Allsop P had regard to the implied freedom. His Honour acknowledged that the section should be read so as not to offend the freedom and that such an approach would necessarily affect the content of "offensive", in light of the purpose of the section330. Bathurst CJ said that the purpose of s 471.12 is to protect persons from being menaced and harassed and subjected to material that is offensive. It could be inferred that the legislature considered such protection to be necessary, having regard to the features unique to a postal service, namely that it is used to send communications to a person's home or business address. It is a personalised service in that sense. It is usual for a person to open mail addressed to them and the effect of a communication is therefore difficult to avoid. A recipient in that sense is a captive audience331. Allsop P likewise saw the section as directed to a service that brings communications into people's homes or places of work, generally in packages that will be opened. Thus the seriousness of the use of the service is that it allows a communication that is menacing, harassing or offensive to be brought into and invade the personal domain of the addressee332. Such an intrusion is capable of undermining a sense of civil peace and a sense of the security of one's domain without warning and without consent. In that sense, it could affect public confidence in postal services333. A wider meaning? The appellants' approach to the meaning of the word "offensive" in s 471.12 denies the relevance of context. The modern approach to interpretation, particularly in the case of general words, requires that the context be considered 329 Monis v The Queen (2011) 256 FLR 28 at 39 [43]. 330 Monis v The Queen (2011) 256 FLR 28 at 45-46 [76]. 331 Monis v The Queen (2011) 256 FLR 28 at 42-43 [59]. 332 Monis v The Queen (2011) 256 FLR 28 at 45 [75]. 333 Monis v The Queen (2011) 256 FLR 28 at 46 [78]. in the first instance and not merely later when some ambiguity is said to arise334. Such an approach was confirmed as correct in Project Blue Sky Inc v Australian Broadcasting Authority335. Whilst the process of construction concerns language, it is not assisted by a focus upon the clarity of expression of a word to the exclusion of its context. The word "offensive" is used in s 471.12 in conjunction with "menacing" or "harassing". The appellant Droudis submits that nothing could be gained from those other words, because what is sought to be derived from them is not a similarity of kind336, but of degree. It is true that a communication which has the quality of being menacing or harassing can be seen to be personally directed and deliberately so. An offensive communication may have those qualities; it may not. In many cases though, the purpose of sending an offensive communication through the post will be to target the addressee. Importantly, the grouping of the three words and their subjection to the same objective standard of assessment for the purposes of the offences in s 471.12 suggests that what is offensive will have a quality at least as serious in effect upon a person as the other words convey. The words "menacing" and "harassing" imply a serious potential effect upon an addressee, one which causes apprehension, if not a fear, for that person's safety337. For consistency, to be "offensive", a communication must be likely to have a serious effect upon the emotional well-being of an addressee. The penalty for each of the offences under s 471.12 is the same. The maximum penalty is significant: two years' imprisonment. The appellant Droudis seeks to diminish the importance of penalty as part of the context of the offence involving offensive communications because it might be the subject of an exercise of discretion in a particular case. But it has long been accepted that penalty is an indication of the seriousness with which the legislature views an offence. The severity of penalty was regarded as a matter of no small importance in Coleman v Power338, and there the maximum penalty was much less: six months' imprisonment. 334 K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 315 per Mason J; [1985] HCA 48. 335 (1998) 194 CLR 355 at 381 [69]; [1998] HCA 28. 336 As with the principle of noscitur a sociis. 337 Australia, House of Representatives, Criminal Code Amendment (Anti-hoax and Other Measures) Bill 2002, Explanatory Memorandum at 7. 338 (2004) 220 CLR 1 at 73 [177]-[178]. The appellant Droudis submits that the legislative history of provisions relating to the use of postal services suggests an intention to widen the scope of material which might be considered offensive, rather than to narrow it. Reliance is placed, in this regard, upon the removal of the words "obscene" and "indecent". Those words were removed when s 85S of the Crimes Act was enacted, when the standard of a reasonable person was introduced as the test for whether communications are offensive. Both "indecent" and "obscene" are words which convey one idea, that of offending against recognised standards of propriety – indecent being at the lower end of the scale and obscene at the upper end339. The word "offensive" is apt to describe the content of communications which range from being indecent to obscene. It has been observed that criminal law provisions concerned with obscenity fall into a category of laws which must necessarily keep pace with prevailing views of society and changing circumstances. It is for that reason that concepts such as "obscenity" and "offensiveness" are inevitably couched in vague terms340. The application of a societal standard may be seen in the use, in s 471.12, of the objective standard of the reasonable person. The appellant Droudis places even greater weight on the omission of the word "grossly", which had qualified the word "offensive" in legislation which preceded the Postal Services Act 1975 and its attendant regulations. This is said to support an inference that the nature of the offence was regarded as less serious than it had been before. The reference was changed from "grossly offensive" to "offensive" in character at the same time as the words "blasphemous" and "libellous" were removed. These changes do not necessarily suggest that some lesser seriousness was then thought to attach to the offence. The words "libellous" and "blasphemous" may have been removed because they were considered outmoded and no longer a reflection of what might be regarded, in 1975, as sufficiently serious to warrant criminal liability. In any event, the submission overlooks the fact that s 85S later grouped the offences relating to menacing or harassing communications with that relating to offensive communications. Those firstmentioned offences now provide part of comprehended by the offence relating to offensive communications. The submission also ignores the fact that when s 471.12 was enacted, the maximum the context for what 339 R v Stanley [1965] 2 QB 327 at 333 per Lord Parker CJ. 340 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 210 [55] per Simon Brown LJ; Müller v Switzerland (1988) 13 EHRR 212 at 226 [29]. term of imprisonment was raised from one to two years, in recognition of the seriousness of the offence341. It may also be observed that s 471.12 is preceded in the Code by other offences relating to postal services which may be regarded as of a serious nature. Section 471.10(1) makes it an offence to cause an article to be carried by a postal service with the intention of inducing a false belief that it contains an explosive or a dangerous or harmful substance. Section 471.11 refers to using a postal or similar service to make a threat to kill or a threat to cause serious harm. These sections refer to conduct which may create fear or apprehension. The word "grossly" may have been thought an unnecessary gloss to the word "offensive", given that it had for some time been understood to refer to language or conduct at the higher end of the spectrum of offensiveness. For the purposes of the offence against s 1(1) of the Malicious Communications Act 1988 (UK), a communication has to be "grossly offensive". That standard has been said to require more than statements of opinion which may be distasteful or even painful to those subjected to them342. This does not seem so far from what was said in Ball v McIntyre and what was accepted as the meaning of "offensive" in s 471.12 by the Court of Criminal Appeal. Freedom from intrusion No conclusion can be reached regarding the construction of that part of s 471.12 which concerns offensive communications without identifying its purpose. The identification of that purpose is essential for the application of the Lange test. In the context of offence provisions, the question of purpose is rarely answered by reference only to the words of the provision, which commonly provide the elements of the offence and no more. It may be necessary to consider the context of the provision including other provisions in the statute and the historical background to the provision. Further, in the case of many crimes, the social objective of the legislation can be self-evident, and, in these appeals, may readily be inferred in respect of s 471.12. The purpose of s 471.12, contrary to the appellant Droudis' contention, is not merely to ensure civility of discourse between users of the postal service. In this regard, it may immediately be observed that offensive, menacing or harassing communications will almost certainly be unsolicited. The section is, 341 Australia, House of Representatives, Criminal Code Amendment (Anti-hoax and Other Measures) Bill 2002, Explanatory Memorandum at 7. 342 Chambers v Director of Public Prosecutions [2013] 1 All ER 149 at 156 [28]. therefore, not concerned with mutual discourse. The section does not qualify an offensive communication as unsolicited, but the circumstance that it was sent unsolicited will be a circumstance relevant to the method of use to which the section refers. The appellant Droudis accepts that s 471.12 might be said to protect the "integrity of the post" and to maintain "public confidence in the postal service" and accepts that those purposes are rationally connected to preserving a sense of security or safety on the part of recipients of mail. The risk of physical harm presented by physical objects and substances sent through the post is addressed in Pt 10.5 of the Code, as earlier mentioned. So too is the risk of the creation of fear or apprehension in an addressee who receives a communication in the nature of a hoax or threat. Section 471.12 seeks to deter a particular use of a postal service. It may be taken to recognise a citizen's desire to be free, if not the expectation that they will be free, from the intrusion into their personal domain of unsolicited material which is seriously offensive. In the 18th century, postal services were made a sovereign function in many nations, because they were considered a necessity. It was not possible to have government without communication343. This underscores the importance of the implied freedom in the context of the regulation of postal services. Yet around the same time, an English judge made the social observation that "[e]very man's house is his castle"344 when discussing the conditions for the execution of search warrants. That a warrant to search premises might not identify the object of the search was described as "totally subversive of the liberty of the subject"345. Such a requirement is commonplace in Australian statutes today346. 343 United States Postal Service v Council of Greenburgh Civic Associations 453 US 114 at 121 (1981); see also Lamont v Postmaster General 381 US 301 at 305 344 Bostock v Saunders (1773) 2 Wm Bl 912 at 914 per De Grey CJ [96 ER 539 at 345 Wilkes v Wood (1763) Lofft 1 at 18 [98 ER 489 at 498]; see also Entick v Carrington (1765) 2 Wils KB 275 [95 ER 807]. 346 New South Wales v Corbett (2007) 230 CLR 606 at 629-630 [95]; [2007] HCA 32. In Rowan v United States Post Office Department347, Burger CJ referred to the continuing "vitality" of the concept of the home as castle when considering whether there was a "right to communicate offensively with another". In that case, it was observed that people are often "captives" outside the sanctuary of the home, but that this does not mean that they must be captives everywhere348. It has been said that "a special benefit of the privacy all citizens enjoy within their own walls, which the State may legislate to protect, is an ability to avoid intrusions."349 More in R recently, (ProLife Alliance) v British Broadcasting Corporation350 it was said, in connection with a possible television broadcast of images of aborted foetuses, that members of the public may be outraged to be confronted, in the privacy of their homes, with gratuitously offensive material. A citizen "has a right not to be shocked or affronted by inappropriate material transmitted into the privacy of his home"351. In Connolly v Director of Public Prosecutions352, which the Malicious Communications Act353, it was held that just as people have the right to be protected in their homes from grossly offensive and indecent letters, so too, in general terms, do people in the workplace. an offence under concerned The Australian Constitution does not afford a person a right of protection against unwarranted intrusions of a seriously offensive kind. Nor does it provide a personal right of freedom to communicate regarding matters relating to politics and government. It implies a freedom of political communication which operates to restrict the exercise of legislative power in a manner that is incompatible with, or is likely to unduly restrict, that freedom. But the freedom is not absolute. The Code, by s 471.12, seeks to protect people from the intrusion of offensive material into their personal domain. It does not create a right but may serve to 347 397 US 728 at 737 (1970). 348 Rowan v United States Post Office Department 397 US 728 at 738 (1970). 349 Frisby v Schultz 487 US 474 at 484-485 (1988). 350 [2004] 1 AC 185 at 243 [91]. 351 R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 252 352 [2008] 1 WLR 276 at 285 [28]; [2007] 2 All ER 1012 at 1021. 353 Referred to at [264] above. deter persons from such misconduct. It may do so according to Lange, and relevantly, so long as it does not go too far. The appellants point to the recent decision of the United States Supreme Court in Snyder v Phelps354, where the First Amendment to the Constitution was applied in circumstances not dissimilar to those present in this case. The right of freedom of speech was held to protect a group of persons picketing at the funerals of servicemen from liability in tort, although it was observed by the dissentient355 that the protected speech made no contribution to public debate. There is little to be gained by recourse to jurisprudence concerning the First Amendment, although it may be observed that, despite the wide protection it affords freedom of speech, which is regarded as almost absolute, it has been considered necessary to except obscene or indecent material from that constitutional protection356. That jurisprudence may be contrasted with that in Europe, where freedom of political speech is protected under Art 10 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1950). Freedom of communication is there described as one of the essential foundations of a democratic society357, but it is not said to be absolute. By Art 10(2) it may be subjected to such conditions, restrictions and penalties as are "necessary in a democratic society". In language reminiscent of that in Lange, it has been held that a law may be justified if the restriction it imposes is proportionate to a legitimate aim358. In Handyside v United Kingdom, the Obscene Publications Act 1959 (UK), as amended by the Obscene Publications 354 179 L Ed 2d 172 (2011). 355 Snyder v Phelps 179 L Ed 2d 172 at 193 (2011) per Alito J. 356 Hamling v United States 418 US 87 (1974) (concerning postal communications); Federal Communications Commission v Pacifica Foundation 438 US 726 (1978) (concerning radio communications); compare Reno v American Civil Liberties Union 521 US 844 (1997) (concerning internet transmissions). 357 The Observer and the Guardian v United Kingdom (1991) 14 EHRR 153 at 191 [59]; Jersild v Denmark (1994) 19 EHRR 1 at 14 [30]; Vogt v Germany (1996) 21 EHRR 205 at 234-235 [52]. 358 Handyside v United Kingdom (1976) 1 EHRR 737 at 754 [49] (putting to one side references to a margin of appreciation); see also R (ProLife Alliance) v British Broadcasting Corporation [2004] 1 AC 185 at 202 [29]. Act 1964 (UK), was held to have such an aim in the protection of morals in a democratic society359. Further principles of construction There are stronger reasons than context for reading the word "offensive" in s 471.12 as confined to more seriously offensive communications. It was recognised in early case law concerning the Constitution that it was a sound rule of construction that legislation should, if possible, be interpreted so as not to make it inconsistent with the Constitution360. There is a presumption that Parliament does not intend to pass beyond constitutional bounds361. This principle has been reaffirmed on many occasions. More recently, in New South Wales v The Commonwealth (Work Choices Case)362, it was said that where different constructions are available, that construction which would avoid, rather than lead to, a conclusion of constitutional invalidity is to be selected363. The opening words of s 15A of the Acts Interpretation Act 1901 (Cth), "[e]very Act shall be read and construed subject to the Constitution, and so as not to exceed the legislative power of the Commonwealth", are consistent with this principle. Section 15A is concerned principally with preserving so much of a statute as may be valid. The principle expressed in its opening words is to be applied in that process. Latham CJ said in Australian National Airways Pty Ltd v The Commonwealth364 that he regarded s 15A "as a direction to the Court to treat all statutes as being valid as far as possible, and to assume, as the general intention of Parliament, that as much of an Act shall operate as can operate, even if other parts may fail." 359 Handyside v United Kingdom (1976) 1 EHRR 737 at 752-753 [46]. 360 Davies and Jones v The State of Western Australia (1904) 2 CLR 29 at 43 per Griffith CJ; [1904] HCA 46. 361 Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 180 per Isaacs J; [1926] HCA 58. 362 (2006) 229 CLR 1 at 161-162 [355]; [2006] HCA 52, cited in Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11] per Gummow, Hayne, Heydon and Kiefel JJ; [2008] HCA 4. 363 See also Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373 at 469; [1995] HCA 47. 364 (1945) 71 CLR 29 at 65; [1945] HCA 41. Of course, this principle of construction is subject to the language and purposes of the Act in question. It permits legislation to be read in a way which would result in validity, but only so far as the language permits and only if there is no clear contrary intention that the statute is to operate in a way which must inevitably lead to invalidity365. General words and expressions may sometimes give rise to difficulties in the application of the principle. Such words may be capable of applying a provision to cases where it is within power as well as to cases where it is beyond power366. The solution, where the Court is faced with general words, which may be applied so as to maintain legislation within the limitation on legislative power effected by the implied freedom, may be found in the intention of the statute367. The question of legislative intention directs attention to another principle of construction which is to be applied here. Like the firstmentioned principle, arising from the presumption of constitutional validity, the principle of legality is based upon a presumption which may be sourced in rule of law concepts. The principle of legality is known to both the Parliament and the courts as a basis for the interpretation of statutory language368. It presumes that the legislature would not infringe rights without expressing such an intention with "irresistible clearness"369. The same approach may be applied to constitutionally protected freedoms. In such a circumstance it may not be necessary to find a positive warrant for preferring a restricted meaning370, save where an intention to restrict political communication is plain (which may result in invalidity). A meaning 365 Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 267; [1945] HCA 30. 366 Pidoto v Victoria (1943) 68 CLR 87 at 110-111 per Latham CJ; [1943] HCA 37; see also R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652 per Dixon J; [1939] HCA 19. 367 R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652 per Dixon J. 368 Electrolux Home Products Pty Ltd v Australian Workers' Union (2004) 221 CLR 309 at 329 [21]; [2004] HCA 40. 369 Potter v Minahan (1908) 7 CLR 277 at 304; [1908] HCA 63; see also Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252 at 259 [15]; [2010] HCA 23. 370 As to which see Pidoto v Victoria (1943) 68 CLR 87. which will limit the effect of the statute on those communications is to be preferred. These principles of construction were engaged in Coleman v Power. Kirby J applied the firstmentioned principle, which his Honour described as a principle of "constitutional conformity"371. His Honour said that the word "insulting" should not be given its widest meaning in the context of s 7(1)(d), but should be read narrowly, so that it would not infringe the implied constitutional freedom372. Gummow and Hayne JJ said that once it is recognised that fundamental rights are not to be cut down save by clear words, it follows that the curtailment of free speech by legislation proscribing particular kinds of utterances in public will often be read as "narrowly limited"373. Section 471.12 read down It follows from the earlier discussion, concerning a contextual construction of s 471.12, that there is no barrier presented to reading it down to apply to a narrower category of offensive communications than would be the case if attention were directed only to the wider meaning of the word "offensive". Contextual considerations and legislative history of the offence are consistent with such an approach. It is unlikely that Parliament intended to prohibit all communications which happen to contain matter which may cause some offence. As Gleeson CJ observed in Coleman v Power374, legislation concerned with the regulation of communications usually attempts to strike a balance between competing interests. Section 471.12 may be taken to do so by prohibiting communications which are offensive to a higher degree. The process of construction, by reading down, is undertaken with an eye to the requirements of the second limb of Lange, but it is nevertheless a process of construction which is limited by the language and purposes of the statute. The principles of construction referred to above require that s 471.12 be read down so that it goes no further than is necessary in order to achieve its protective purpose, consistent with its terms, without unduly burdening political communication. 371 Coleman v Power (2004) 220 CLR 1 at 87-88 [227]. 372 Coleman v Power (2004) 220 CLR 1 at 87 [226]. 373 Coleman v Power (2004) 220 CLR 1 at 76 [188]. 374 (2004) 220 CLR 1 at 32 [32]. It might be thought a simple matter to excise political communication from the purview of s 471.12. Such an approach may underestimate the difficulty in determining when a communication is said to qualify as "political". This points to the need for statutory context and direction and here s 471.12 That is because the section is intended to apply to provides none. communications which are offensive to the requisite degree, regardless of subject matter. The legislative history and framework support a construction which applies a degree of offensiveness to the quality of the communication which is intended to be prohibited; they do not support the creation of an exception by reference to its subject matter. The cases concerned with statutory prohibition or regulation of offensive conduct or communications make plain, and the judgments in the Court of Criminal Appeal confirm, that it is well understood that the protection intended to be provided by provisions such as s 471.12 relates to a degree of offensiveness at the higher end of the spectrum, although not necessarily the most extreme. Words such as "very", "seriously" or "significantly" offensive are apt to convey this. It is difficult to accept that this would be insufficient for the purposes of the application of the objective standard of the reasonable person, who may be taken to reflect contemporary societal standards, including those relating to robust political debate. For the purposes of the construction of s 471.12 and the application of the Lange test, it would not seem necessary to go further by attempting to describe what level of emotional reaction or psychological response might be thought likely to be generated by a seriously offensive communication. It might be necessary to do so when directing a jury charged with finding whether the offence is made out. Juries, and trial judges, often grapple with concepts that are difficult to define with precision. Proof beyond reasonable doubt comes immediately to mind, as does the perception of a reasonable person. Such concepts, although attended by a degree of difficulty in application, are not usually regarded by the courts as incapable of application. Rather it is recognised that juries will require assistance by the directions given by a trial judge. It would be possible to provide sufficient guidance in this way about the limits of the offence comprehended by s 471.12. The examples given in the Court of Criminal Appeal of the type of reaction which an offensive communication might engender375 are useful to show the level of seriousness of the offence. One would expect such a communication to be likely to cause a significant emotional reaction or 375 Discussed at [304] above. psychological response. The former may range from shock through to anger, hate, disgust, resentment or outrage, and the latter may include provocation, anxiety, fearfulness and insecurity. As indicated earlier376, a range of circumstances may be relevant to the method of use to which the postal service is put. An exhaustive list is not possible. Communications with such serious effects may be contrasted with those which cause mere hurt feelings. The comparison drawn by the appellants with the standard set in some of the judgments in Coleman v Power is not useful. The offence there concerned statements made in a public place and therefore raised questions of public order, including the possibility that insulting and abusive statements might provoke violence. Section 471.12 operates in a different sphere and for different purposes. Its purposes are not confined to ensuring the civility of discourse in society. Its protective purposes, and the means by which they are achieved, are to be determined not by reference to Coleman v Power, but by the application of the Lange test. The Lange test applied Thus far, the field of operation of the offence contained in s 471.12 has been identified by reference to the quality of the communications subject to it and the degree of offensiveness necessary. The restriction of the offence to higher levels of offensiveness will limit the number of political communications which are caught by it. There is a further restriction on the operation of the section which arises from proof of the fault element of the offence. As was pointed out in argument, the scope of s 471.12 is further confined when regard is had to this element. The fault element that applies to a use of the postal service that reasonable persons would regard, in all the circumstances, as offensive, is recklessness 377. A person will be reckless if he or she is at least aware of a "substantial risk" that reasonable persons would so regard the use, where it is unjustifiable to take the risk378. Intention or knowledge will also satisfy the fault element of recklessness379. The requirement of proof of fault therefore excludes from the scope of the offence those cases where the conduct could not be said to be intentional or reckless. 377 See Criminal Code, s 5.6(2). 378 Criminal Code, s 5.4(1). 379 Criminal Code, s 5.4(4). It may also be observed that s 471.12 is not directed to political communication. It only incidentally burdens them in its operation. A distinction has been drawn between laws of this kind and laws which prohibit or restrict communications that are inherently political380. The distinction is most relevant in applying the second limb of the Lange test. As was observed in Wotton v Queensland381, a law which only incidentally restricts political communication is more likely to satisfy that aspect of the test. Nevertheless, s 471.12 "effectively burdens" such communications for the purpose of the first limb of the test. Political communication which is offensive within the meaning of the section will be penalised, and may be deterred for that reason. It may be accepted that an effect upon political communication which is so slight as to be inconsequential may not require an affirmative answer to the first limb enquiry, but it cannot be suggested that s 471.12 falls within this category, even if its likely effect is hard to quantify. Once a real effect upon the content of political communication is seen as likely, attention must be directed to the second limb of the test. That is because the evident purpose of Lange is to require a justification for a burden placed upon the freedom382. This is not to say that the level of the restriction or burden which is imposed is not relevant. Lange itself shows that it is; but it is a question to be addressed in connection with consideration of the second limb of the Lange test. The second limb of the Lange test asks whether s 471.12 is "reasonably appropriate and adapted" to serve a legitimate end in a manner compatible with the maintenance of the constitutionally prescribed system of representative government. In Lange it was said that there was no need to distinguish between the concept to which the phrase "reasonably appropriate and adapted" might give expression and proportionality383. Given that Lange most clearly involves proportionality analysis, the question arises whether the use of the term 380 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 200 [40]; [2004] HCA 41; Hogan v Hinch (2011) 243 CLR 506 at 555-556 [95]; Wotton v Queensland (2012) 246 CLR 1 at 16 [30], 30 [78]. 381 (2012) 246 CLR 1 at 16 [30]. 382 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85] (referring to a "substantial" reason); Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 478 [105], quoting Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 383 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 562, 567 "reasonably appropriate and adapted" should be continued in connection with the Lange test, or in other areas where proportionality analysis is employed such as s 92 of the Constitution. It has been observed384 that the phrase "reasonably appropriate and adapted" was imported into Australian constitutional proportionality case law from a judgment of Marshall CJ given in 1819385. It is cumbersome and lacks clarity of meaning and application as a test. The only real affinity the phrase bears to a test involving proportionality analysis is the employment of the word "reasonably", but even then it does not describe how, and by reference to what factors, it is intended to operate. The phrase provides no guidance as to its intended application and tends to obscure the process undertaken by the court. Its use may encourage statements of conclusion absent reasoning386. It cannot be denied that Lange involves a level of proportionality analysis, albeit one which is to be applied in the setting of the Australian Constitution. So much was said in Lange. In the setting of the Australian Constitution, a system of representative government is the constitutional imperative upon which the implied freedom is founded. The proportionality analysis in Lange is directed to determining whether the freedom is illegitimately burdened. The analysis is both informed and constrained by that purpose. The use of proportionality analysis is a rational response to the enquiry as to how the effect upon a freedom which is not absolute may be tested. The term proportionality used in this setting does not imply, without more, a proportionality analysis identical to that employed in other constitutional settings, although it may be possible to draw comparisons which are valid. Nevertheless it is an analysis based in reasonable proportionality and it would be preferable, to avoid confusion and for clarity, to identify the process by its name and explain how it is applied. The second limb of Lange looks, in the first place, to whether the law is proportionate to the end it seeks to serve. In Lange, it will be recalled, once the common law of defamation was adapted it was regarded as going no further than was necessary having regard to the legitimate purpose of protection of 384 Coleman v Power (2004) 220 CLR 1 at 90 [234] per Kirby J; Rowe v Electoral Commissioner (2010) 243 CLR 1 at 133-134 [431]-[435] per Kiefel J. 385 McCulloch v Maryland 17 US 316 at 421 (1819). 386 In Coleman v Power (2004) 220 CLR 1 at 90 [234], Kirby J described it as involving "a ritual incantation". reputation387. Where there are other, less drastic, means of achieving a legitimate object, the relationship with the legislative purpose may not be said to be proportionate388, at least where those means are equally practicable and available389. Given the proper role of the courts in assessing legislation for validity, such a conclusion would only be reached where the alternative means were obvious and compelling, as was the Tasmanian legislation in Betfair Pty Ltd v Western Australia390. In such circumstances the means could not be said to be reasonably necessary to achieve the end and are therefore not proportionate391. The protective purpose of s 471.12 is directed to the misuse of postal services to effect an intrusion of seriously offensive material into a person's home or workplace. It is not possible to further read down the degree of offensiveness of a communication which is to be the subject of the offence and retain a field of operation for the section consistent with its purpose. It follows that the section, so construed, goes no further than is reasonably necessary to achieve its protective purpose. A purpose of protecting citizens from such intrusion is not incompatible with the maintenance of the constitutionally prescribed system of government or the implied freedom which supports it. Section 471.12 is not directed to the freedom. By way of analogy, it will be recalled that in Lange the protection of reputation was not considered to be incompatible. That leaves the question of whether the section imposes too great a burden upon the implied freedom by the means it employs. This assessment reflects an acceptance that some burden may be lawful. In Coleman v Power, McHugh J 387 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 572-573, 388 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568, where the Court referred to the example of Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106. 389 North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 616; Uebergang v Australian Wheat Board (1980) 145 CLR 266 at 306; Rowe v Electoral Commissioner (2010) 243 CLR 1 at 134 [438]. 390 (2008) 234 CLR 418 at 479 [110]; see also North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 608. 391 North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 616; Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 477 [102]. said that a law could validly impose some burden but nevertheless leave political communication "free". It would be free if the burden was not unreasonable392. A test of proportionality is again invoked. The appellant Monis submits that s 471.12 constitutes a "very substantial fetter" on discussion of political matters absent provision for defences of the kind that are available to a defendant in an action for defamation, such as the statutory defence of qualified privilege393, which applies a test of reasonableness to the defendant's conduct. An allied submission refers to what had been said in Lange in that regard. These submissions draw in part on McHugh J's criticism of the provision considered in Coleman v Power, which provided no defence to the charge of using insulting words in, or within the hearing of, a public place394. However, that provision was very different from s 471.12. Having regard to the elements of the offence in s 471.12, considerable ingenuity would be required to conceive the field of operation of a defence that the accused's use of the postal service was a reasonable communication for the discussion of political matters. The appellant Monis' submissions overlook the circumstance that before any consideration of a defence could arise, the jury must have determined both that the postal service was used in a way that a reasonable person, taking into account all the circumstances, would regard as offensive, and that the accused was aware of the substantial risk that the use would be so regarded by a reasonable person and unjustifiably took that risk. And as to common law defences to defamation, such as qualified privilege, where the issue of malice may arise, the requirement of proof for an offence under s 471.12, that the defendant's conduct be intentional or reckless, may leave little room for their operation. It has earlier been observed that the effect of s 471.12 upon political communication is incidental. Further, communications of the kind which are prohibited by s 471.12 are limited to those which are of a seriously offensive nature. This does not suggest an effect upon the freedom which could be regarded as extensive. It does not prevent communications of a political nature which do not convey such offensive matter. The observations of Brennan J in Nationwide News395 are apposite. His Honour said with respect to the implied freedom that the Constitution may be taken to prohibit legislative or executive infringement of the freedom to discuss political matters, except to the extent 392 Coleman v Power (2004) 220 CLR 1 at 53 [100]. 393 Defamation Act 2005 (NSW), s 30. 394 Coleman v Power (2004) 220 CLR 1 at 33 [36], 41-42 [69]-[71]. 395 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 50-51. necessary to protect other legitimate interests. It prohibits a restriction which substantially impairs the opportunity for the Australian people to form the necessary political judgments. Section 471.12 does not impermissibly burden the implied freedom. The Lange test is satisfied. Section 471.12 is valid. Conclusion and orders The appeals should be dismissed. There should be no order for costs. None was made by the Court of Criminal Appeal, no doubt because of the nature of the matter.
HIGH COURT OF AUSTRALIA NORTH AUSTRALIAN ABORIGINAL LEGAL AID SERVICE INC APPELLANT AND HUGH BURTON BRADLEY & ANOR RESPONDENTS North Australian Aboriginal Legal Aid Service Inc v Bradley [2004] HCA 31 17 June 2004 ORDER Appeal dismissed. On appeal from the Federal Court of Australia Representation: S J Gageler SC with A R Moses and P D Keyzer for the appellant (instructed by No appearance for the first respondent T I Pauling QC, Solicitor-General for the Northern Territory, with P J Hanks QC for the second respondent (instructed by Solicitor for the Northern Territory) Interveners: D M J Bennett QC, Solicitor-General of the Commonwealth, with C J Horan intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales, with M J Leeming intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for the State of New South Wales) C J Kourakis QC, Solicitor-General for the State of South Australia, with C D Bleby intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor of the State of South Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS North Australian Aboriginal Legal Aid Service Inc v Bradley Statutes – Construction – Magistrates Act (NT), s 6 – Requirement that a magistrate be paid such remuneration and allowances as determined from time to time by the Administrator – Respondent appointed Chief Magistrate with 11 years to serve before age of compulsory retirement – Initial determination of remuneration by Administrator limited to a two year period – Whether appointment valid pursuant to Magistrates Act (NT). Constitutional law (Cth) – Judicial power of the Commonwealth – Vesting in State and Territory courts – Minimum requirements for the appearance of impartiality and independence – Whether contravened by appointment where salary determined for a limited period. Constitution, Ch III. Magistrates Act (NT), ss 4, 6, 7, 19A. Remuneration Tribunal Act (NT). GLEESON CJ. The appellant brought proceedings in the Federal Court of Australia to challenge the validity of the appointment of the first respondent as Chief Magistrate of the Northern Territory. The challenge failed before Weinberg J1. An appeal to the Full Court of the Federal Court was dismissed (Black CJ and Hely J; Drummond J dissenting)2. The case for the appellant, as argued in this Court, is based upon a contention that, upon its true construction, the Magistrates Act (NT) ("the Magistrates Act"), pursuant to which the first respondent was appointed, did not authorise the appointment in the circumstances that existed in relation to the determination of his remuneration. The construction argument was said to be supported by constitutional and common law principles concerning judicial independence and impartiality, and by the consideration that a purpose of the Magistrates Act was to further the independence of the Northern Territory's magistracy. The appellant also argued that, if the Magistrates Act had purported to authorise the appointment in the circumstances, then to that extent it would infringe the principle in Kable v Director of Public Prosecutions (NSW)3. This was said to be a reason to construe the statute in the manner for which the appellant contends. Alternatively, it was said to result in partial invalidity. The fundamental importance of judicial independence and impartiality is not in question. It was recently affirmed by this Court in Ebner v Official Trustee in Bankruptcy4. It was declared in Art 2.02 of the Universal Declaration of the Independence of Justice and in the Beijing Statement of Principles of the Independence of the Judiciary in the LAWASIA Region. The content of the principle that citizens have the right to have disputes decided by an independent and impartial tribunal has been examined in cases concerning Art 6 of the European Convention for the Protection of Human Rights and Fundamental Freedoms5 and s 11(d) of the Canadian Charter of Rights and Freedoms6. In 1 North Australian Aboriginal Legal Aid Service Inc v Bradley (2001) 192 ALR 625. 2 North Australian Aboriginal Legal Aid Service Inc v Bradley (2002) 122 FCR 204. (1996) 189 CLR 51. (2000) 205 CLR 337 at 343 [3]. 5 Findlay v United Kingdom (1997) 24 EHRR 221; V v United Kingdom (1999) 30 EHRR 121; Porter v Magill [2002] 2 AC 357; R v Home Secretary; Ex parte Anderson [2003] 1 AC 837; Clark v Kelly [2003] 2 WLR 1586; [2003] 1 All 6 Valente v The Queen [1985] 2 SCR 673; Mackin v New Brunswick [2002] 1 SCR 405; Ell v Alberta [2003] 1 SCR 857. Porter v Magill7, the House of Lords cited the statement of the European Court to the effect that, in considering whether a tribunal is independent, regard must be had inter alia to the manner of appointment of its members and their term of office, and the existence of guarantees against outside pressures. The Supreme Court of Canada has said that "[t]he manner in which the essential conditions of independence may be satisfied varies in accordance with the nature of the court or tribunal"8. It has also pointed out that "[c]onceptions have changed over the years as to what ideally may be required in the way of substance and procedure for securing judicial independence in as ample a measure as possible"9. Within the Australian judiciary, there are substantial differences in arrangements concerning the appointment and tenure of judges and magistrates, terms and conditions of service, procedures for dealing with complaints against judicial officers, and court administration. All those arrangements are relevant to independence. The differences exist because there is no single ideal model of judicial independence, personal or institutional. There is room for legislative choice in this area; and there are differences in constitutional requirements. For example, s 72 of the Constitution does not permit the appointment of federal acting judges. On the other hand, acting judges are commonly appointed for fixed, renewable, terms in some State and Territory courts. This Court decided in Re Governor, Goulburn Correctional Centre; Ex parte Eastman10 that acting judges may be appointed in the Supreme Court of the Australian Capital Territory. In the Northern Territory, the legislation with which this case is concerned provides for the appointment of acting magistrates (s 9). (The legislation also provides for the appointment of justices of the peace as Special Magistrates (s 14).) The role of the magistracy in the administration of civil and criminal justice in the various Australian jurisdictions continues to evolve. In New South Wales, Governor Phillip held a commission as a justice of the peace. From the foundation of that colony, stipendiary magistrates, as well as administering justice in summary proceedings, had extensive administrative responsibilities. Originally, they were organised as part of the colonial, and later State, public service. It was not until 1955 that new recruits to the New South Wales magistracy had to be legally qualified11. In 1986, New South Wales magistrates [2002] 2 AC 357 at 489 [88] per Lord Hope of Craighead. 8 Ell v Alberta [2003] 1 SCR 857 at 873 [30]. 9 Valente v The Queen [1985] 2 SCR 673 at 692. 10 (1999) 200 CLR 322. 11 Golder, High and Responsible Office: A History of the NSW Magistracy (1991) at were taken out of the public service, and given structural independence, including judicial tenure12. A turning point in the history of the Northern Territory magistracy was the 1976 decision in Fingleton v Christian Ivanoff Pty Ltd13, which exposed problems resulting from the circumstance that, in the South Australian public service, magistrates and prosecuting officers were members of the same Department. This decision led to the removal of Northern Territory legislation presently under magistrates from consideration. the public service by the It may be accepted that it was an object of the Magistrates Act to give Northern Territory magistrates a degree of personal and institutional independence significantly in advance of what they had previously enjoyed. Under the Act, a magistrate holds office until the age of 65, subject to earlier resignation (ss 7, 8). A magistrate shall not be removed from office unless specified conditions are satisfied (s 10). Appointment and removal is by the Administrator of the Territory (ss 4, 10). Magistrates upon appointment take oaths or make affirmations in the same form as Justices of this Court and the members of other federal courts. Section 62A of the Interpretation Act (NT) ("the Interpretation Act") provides that, in interpreting an Act, a construction that promotes the purpose or object underlying the Act is to be preferred to a construction that does not promote the purpose or object. It is, however, one thing to say that the Magistrates Act has a purpose of advancing the independence of the magistracy. It is a different thing to say that it has a purpose of securing such independence to the highest possible degree in every respect. As has been noted, there is no ideal model of independence, and both historically and at the present time, arrangements capable of affecting independence have varied, and continue to vary, between Australian jurisdictions. As a number of decisions of the Supreme Court of Canada demonstrate, it is possible to identify certain minimum conditions that must be satisfied if a judicial body is to be regarded as independent and impartial14. Beyond those minimum conditions, however, both history and current practice reveal that there is significant room for divergence. 12 Judicial Officers Act 1986 (NSW). 13 (1976) 14 SASR 530. 14 Valente v The Queen [1985] 2 SCR 673; R v Beauregard [1986] 2 SCR 56; R v Généreux [1992] 1 SCR 259; Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island; Reference re Independence and Impartiality of Judges of the Provincial Court of Prince Edward Island [1997] 3 SCR 3. Section 4 of the Magistrates Act, which established the office of Chief Magistrate, empowers the Administrator to appoint to that office, or to the office of Magistrate, a person eligible for appointment in accordance with s 5. Section 6 provides that a Magistrate, including a Chief Magistrate, shall be paid such remuneration and allowances, and hold office on such terms and conditions, as the Administrator from time to time determines. The capacity, conferred on the Administrator by s 6, to determine the remuneration of a Magistrate, including the Chief Magistrate, from time to time, involves both a power and a duty. Section 6 is not expressed in terms that are either permissive or obligatory. It simply provides that an appointee is to be paid such remuneration and allowances as the Administrator determines. Leaving to one side any question as to the form and content of such a determination, whether it can be for a fixed period, or for an interim period, or of indefinite duration, and whether and in what circumstances a redetermination may be made, the section clearly confers on the Administrator an authority to make a determination in respect of any appointee. It may be made in respect of a class generally, or it may be made in respect of an individual, such as a Chief Magistrate. It is a matter of statutory interpretation to decide whether there is a duty as well as a power to exercise the authority. It is to be used, at least in part, for the benefit of an appointee, and this in itself is a strong indication that there is a duty to exercise it at least once in relation to any given appointee15. Another strong indication is that the existence of the Northern Territory magistracy, in a practical sense, depends upon having in place, at any time, appropriate arrangements for the remuneration of magistrates. A statutory provision that an office holder "shall be paid" such remuneration as the Executive, from time to time, determines, should not be understood to mean that the Executive may choose never to make a determination, or never to make a determination in relation to an office holder, in which event the office holder will be paid nothing; least of all where the office holder is meant to be independent of the Executive. On any view, therefore, the Administrator is obliged to make at least one determination of the remuneration to be paid to a Chief Magistrate. Section 41 of the Interpretation Act provides that, where an Act confers a power or imposes a duty, the power may be exercised and the duty shall be performed from time to time as to make further the occasion requires. determinations of such remuneration from time to time as the occasion requires, and there may be circumstances giving rise to an obligation to do so. An example of such a requirement would be the expiry of an earlier determination. Apart from the circumstances of the present case, to which reference will be made below, it is not difficult to imagine how that might occur. Suppose, for The Administrator is entitled 15 Julius v Lord Bishop of Oxford (1880) 5 App Cas 214 at 222-223; Ward v Williams (1955) 92 CLR 496 at 505-506; Pyrenees Shire Council v Day (1998) 192 CLR 330 at 346 [22]; Samad v District Court (NSW) (2002) 209 CLR 140. example, that, as sometimes happens, the Executive decides that there is to be a general review of remuneration and allowances of magistrates, and it is expected that such review may take a considerable time to complete. The statute would permit an interim determination pending the outcome of the review. The completion of the review may then be an occasion requiring a further determination. This is not uncommon, and is not inconsistent with the requirements of independence. There is no reason to give the general words of s 6 a strained and narrow construction which would prevent the making of a determination for an interim period, or a determination that for some other legitimate reason may come to an end in circumstances that require the making of a further determination. Such a construction does not advance any legislative purpose. It produces a result that is unreasonable. It should be rejected. In the present case, the Chief Magistrate, the first respondent, was appointed by an instrument dated 27 February 1998, signed by the Administrator, to hold office on and from 9 March 1998. On its face, the instrument of appointment complied with s 4 of the Magistrates Act. There is no question as to the first respondent's eligibility under s 5. The vice in the procedure adopted is said to exist in the nature of the determination of the first respondent's remuneration, made in purported pursuance of s 6. The determination, which was also dated 27 February 1998, and signed by the Administrator, specified the remuneration and allowances of the first respondent for a fixed period of two years, from 9 March 1998 to 8 March 2000. The reason for that will be explained below. It is contended that the determination was invalid because it was not of a kind authorised by s 6. The first comment to be made about that submission is that, even if the premise were correct, the conclusion would not follow. If it were correct to say that, at the time of the appointment of the first respondent, there was no valid determination of his remuneration, then all that would follow would be that he was entitled to have his remuneration validly determined; an entitlement that could be enforced, if necessary, by proceedings for mandamus against the Administrator. The Magistrates Act does not expressly make the existence of a valid determination under s 6 a condition precedent of the validity of an appointment under s 4. No implication to that effect is required or justified. The power to make an appointment under s 4 is vested in the same person as the power and the duty to make a determination under s 6. The making of an appointment assumes a willing appointee. It is unlikely that a person would accept an appointment without at least believing that there was a valid determination of remuneration. Such a belief might be founded upon some misapprehension, including an error of law, but in the ordinary scheme of things an appointee would want to be satisfied with the arrangements for his or her remuneration before accepting office. Since there is, in any event, a duty under s 6 to make at least one determination of a chief magistrate's remuneration, there is no occasion to read into s 4 what is certainly not there expressly, that is to say, that the existence of a valid determination under s 6 is a condition of the exercise of the power given by s 4. The present case is different from Buckley v Edwards16, where a question arose as to the power of the Governor of New Zealand to appoint an additional judge of the Supreme Court of New Zealand without Parliament having made any provision for the salary of a judge so appointed17. There the power to appoint was vested in the Governor, but it was for the Parliament to provide for the salary. And the relevant legislation provided that a judge's salary was to be at least that which, at the time of appointment of the judge, was provided by law. It may be added that, on 27 February 1998, there was in existence a previous determination of the remuneration and allowances of the Chief Magistrate of the Northern Territory. The determination of 27 February purported to revoke that earlier determination but, if it were invalid, it is strongly arguable that the revocation was ineffective and that the earlier, admittedly valid, determination remained in force. It seems unlikely that the Administrator would have intended the revocation of the earlier determination to be independent of the operation of the new determination. Again, the question that arises is one of interpretation of the instrument of revocation and further determination and of whether the two acts were interdependent. On the face of the instrument, the revocation appears to be interdependent with the new determination. For the reasons that follow, however, it is not necessary to pursue that argument. The premise upon which the appellant's case depends is not to be accepted. The form of the determination of 27 February 1998 is explained by the following circumstances, which are set out at greater length in the joint reasons of Black CJ and Hely J in the Full Court18. Over a period before the appointment of the first respondent, there was a proposal in the Northern Territory for the introduction of contract appointments for magistrates. This was controversial, and was ultimately abandoned, but it resulted in some administrative confusion concerning the terms and conditions of the first respondent's appointment. Adding to the confusion was the fact that, when the first respondent (a Northern Territory legal practitioner) was approached with an offer of appointment, he said that he was only willing to remain in the office for two years. (He was then aged 54). Although, in the events that occurred, the first respondent's appointment was for an indefinite period, and would therefore last for 11 years unless he resigned earlier, the determination of remuneration under s 6 fixed his remuneration for a period of two years. It may be mentioned in passing that, as was acknowledged in the course of argument, the Northern Territory has had a history of importing judicial officers from other jurisdictions, many of whom took appointment on the understanding that it would be for a limited term. 17 See [1892] AC 387 at 391. 18 (2002) 122 FCR 204 at 208-211 [9]-[31]. Although there has been a different trend in recent years, the first respondent's original attitude was not novel. The making of the two-year determination did not exhaust either the power or the duty of the Administrator under s 6. The section contemplates determinations from time to time as the occasion requires. When the two-year period expired, the Administrator was obliged to make a fresh determination. The remuneration fixed by it could have been the same as, or different from, the remuneration fixed for the two-year period. It is not necessary, in my view, to decide whether it could have been less. If (and I am not to be taken to accept that this is the case) the Administrator has the power to reduce the remuneration of magistrates, then that power would exist whether the first determination applicable to a magistrate is for a fixed term, or an interim period, or an indefinite period. Plainly, there is no warrant for taking s 6 to mean that the only power in the Administrator, when he appointed the first respondent, was to fix his remuneration, unalterably, for 11 years19. Such an interpretation of s 6 would have consequences seriously adverse to the interests of magistrates. Magistrates in Australia typically take up office at a younger age than 54; most of them are much younger when appointed. To some of them, a conclusion that their remuneration was fixed unalterably from the time of their appointment until they reached the age of 65 would cause serious financial disadvantage, especially in times of substantial inflation. At such times, the most effective way for any government to reduce the real incomes of judicial officers is to do nothing. No one suggests that this is the correct interpretation of s 6. An alternative course that would have been permitted by s 6 was to fix the first respondent's remuneration for an indefinite period, on the basis that it could be altered by a later determination if that is what the Administrator decided to do. The appellant contends, not only that this course was open to the Administrator, but that it was the only course available. This is said to be required by principles of independence. For reasons already given, it is inconsistent with the general language of s 6. And how would such a course have left the first respondent in a better, or more independent, position than the course that was taken? It is argued that the first respondent was left in the position, if he desired to stay on at the end of two years, of having to "re-negotiate" his remuneration with the Executive. It is not clear what the concept of negotiation is said to involve over and above what applies in the case of most judicial officers, including federal judges, when their remuneration is under review. Judicial remuneration is regularly reviewed by remuneration tribunals, but the ultimate power to decide such remuneration from time to time rests with Parliament. Judicial officers are given an 19 Day v Hunkin (1938) 61 CLR 65. opportunity to make representations as to changes that should be made, and that opportunity is sometimes taken up. This is not a process of negotiation. It is a common procedure, consistent with requirements of fairness, transparency and accountability, and consistent also with judicial independence. If the first respondent's remuneration had been determined for an indefinite period, it is possible that at the end of two years, and almost certain that at some time thereafter, had he remained in office, he would have been seeking an alteration. He could have put a case to the Administrator for a review of his remuneration. It might have been necessary for him to do so in order to obtain proper consideration of his position. In the events that occurred, because the determination of 27 February 1998 was structured on the assumption that the first respondent would remain in office for two years only, fairness both to him and to the Northern Territory Government required that it be altered if he decided to stay on indefinitely. That, in fact, is what occurred. The question of principle, however, is whether the making of a determination for a fixed period compromised the independence of the first respondent, bearing in mind that the only alternative course suggested is that his remuneration and allowances should have been set for an indefinite period with the possibility of further redetermination if and when the Administrator so decided. If that question of principle is answered in the negative, then the foundation of the appellant's construction argument disappears, and its reliance on Kable is misplaced. The question does not arise in the abstract. It is a concrete, practical issue, to be resolved having regard to what is said to be the other course that could and should have been adopted. That the other course was available is clear. Whether it was the only available course, consistent with proper respect for the independence of the first respondent, is what is in question. I would answer that question in the negative. I am unable to accept that, in a practical sense, the determination of 27 February 1998, by reason of the form it took, left the first respondent in any position of dependency or disadvantage materially different from the position that would have applied had the determination been for an indefinite period. If the first respondent remained in office after the expiration of two years, the Administrator was obliged to make a further determination. The issues that would arise for consideration in that event would be the same as the issues that would have arisen, sooner or later, as the passage of time inevitably rendered the terms of an indefinite determination inequitable or inappropriate. The appeal should be dismissed. I agree with the consequential orders proposed by McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ. McHugh Kirby Hayne Callinan 16 McHUGH, GUMMOW, KIRBY, HAYNE, CALLINAN AND HEYDON JJ. The appellant ("the Legal Aid Service") renews in this Court its unsuccessful challenge to the validity of the appointment with effect from 9 March 1998 of the first respondent ("Mr Bradley") as Chief Magistrate under the Magistrates Act (NT) ("the Magistrates Act"). Mr Bradley has taken no active part in the litigation. The active opposition has been that of the Northern Territory of Australia ("the Territory"). The proper construction of the Magistrates Act is of primary and critical importance for the Legal Aid Service's case. When the statute receives its proper construction, the grounds upon which the Legal Aid Service urges invalidity cannot succeed. Accordingly, the appeal must fail. Appointment The convenient starting point for consideration of the appeal is an instrument dated 27 February 1998 under the hand of the Administrator of the is headed "APPOINTMENT OF CHIEF Territory. MAGISTRATE" ("the Appointment") and reads: instrument The "I, NEIL RAYMOND CONN, the Administrator of the [Territory], acting with the advice of the Executive Council, in pursuance of section 4(3) of the [Magistrates Act], appoint Hugh Burton Bradley, a person who is eligible to be appointed, to hold the office of Chief Magistrate on and from 9 March 1998." The reference to the Magistrates Act is to legislation which began its life as the Magistrates Ordinance 1977 (NT) enacted by the Legislative Council for the Territory under the Northern Territory (Administration) Act 1910 (Cth) as continued in force by s 57 of the Northern Territory (Self-Government) Act 1978 (Cth) ("the Self-Government Act")20. The Magistrates Act has been amended from time to time by the Legislative Assembly of the Territory exercising its authority under s 6 of the Self-Government Act. Thus, the history of the 20 Section 57(1) of the Self-Government Act states: "Subject to this Act, on and after the commencing date, all existing laws of the Territory have the same operation as they would have had if this Act had not been enacted, subject to alteration or repeal by or under enactment." See Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at McHugh Kirby Hayne Callinan Magistrates Act reflects the development of the constitutional status of the Territory. instrument On the same day as he made the Appointment, the Administrator signed "DETERMINATION OF REMUNERATION, ALLOWANCES AND TERMS AND CONDITIONS OF CHIEF MAGISTRATE" ("the 1998 Determination"). The presently critical text thereof is as follows: headed in pursuance of section 6 of the [Magistrates Act], determine that for the period on and from 9 March 1998 to and including 8 March (iii) the salary payable to the Chief Magistrate is $193,602 per annum, payable fortnightly in arrears, and the salary will increase at the same percentage rate, and from the same date, that Stipendiary Magistrates' salaries increase; the Chief Magistrate is entitled to be provided with a Holden Calais motor vehicle that is to be maintained at the expense of, and the running costs are to be met by, the Territory; the Chief Magistrate is entitled to 'business first' class air travel for the performance of his duty; and subject to subparagraphs (i), (ii) and (iii), the Chief Magistrate is entitled to the same allowances and holds office on the same terms and conditions as other Stipendiary Magistrates." (emphasis added) The 1998 Determination was not based on any report and recommendation of the Remuneration Tribunal under the Remuneration Tribunal Act (NT) ("the Remuneration Act"). It is not suggested that the existence of such a recommendation was a necessary condition for the making of the 1998 Determination. The evidence does indicate that the Administrator, in making the 1998 Determination, acted upon advice that Mr Bradley had indicated that he then wished only to serve for a period of two years and that his salary therefore had been adjusted to make allowance for the circumstance that he would obtain no superannuation benefit for that period of service. McHugh Kirby Hayne Callinan The opening words of par (b) of the 1998 Determination, with the specification of the period from 9 March 1998 to 8 March 2000, are significant for what follows. Subject to the provisions of the Magistrates Act, such as those in s 10 dealing with removal for cause, s 7(1) provided that the Chief Magistrate "holds office until he attains the age of 65 years". Mr Bradley was born in 1944. However, when he assumed office on 9 March 1998, there was in existence no determination of his remuneration for any part of the balance of his term of office which would begin on 9 March 2000. In the events that happened, Mr Bradley has served beyond the two year period. In the meantime, two further determinations were made on 30 November 1999 ("the 1999 Determinations"). These had the effect of revoking the 1998 Determination and making fresh provision in respect of Mr Bradley both until and including 8 March 2000 and thereafter. The litigation The litigation was initiated in the Supreme Court of the Territory by motion dated 20 April 2000. A declaration was sought of the invalidity of the appointment of Mr Bradley to the office of Chief Magistrate of the Territory. On 13 June 2000, Olney J ordered summary judgment for the defendants but an appeal by the Legal Aid Service to the Court of Appeal (Priestley J, Doyle and Brooking AJJ) was successful and the action was reinstated21. Thereafter, on 6 June 2001, Olney J transferred the action to the Federal Court of Australia and it went to trial before Weinberg J. Various issues were raised at trial which are not now in play before this Court. Weinberg J delivered detailed reasons for judgment on 7 December 2001 and dismissed the application22. An appeal to the Full Court of the Federal Court (Black CJ and Hely J; Drummond J dissenting) The appeal to this Court is brought from that decision of the Full Court of the Federal Court. 21 Northern Australian Aboriginal Legal Aid Service Inc v Bradley (2000) 10 NTLR 22 North Australian Aboriginal Legal Aid Service Inc v Bradley (2001) 192 ALR 625. 23 North Australian Aboriginal Legal Aid Service Inc v Bradley (2002) 122 FCR 204. McHugh Kirby Hayne Callinan The case in this Court In the course of argument, the case for the Legal Aid Service was developed and refined. The contention is that a declaration should be made that Mr Bradley was not validly appointed to the office of Chief Magistrate. That invalidity would be the consequence of a holding which should be made by this Court that the Magistrates Act is invalid in so far as it authorised the appointment of a Chief Magistrate to age 65 but with remuneration fixed only for the first two years of the term. The invalidity of the Magistrates Act and, as a consequence, the invalidity of the appointment of Mr Bradley, is said to follow from the application to the statute of the principles derived from Kable v Director of Public Prosecutions (NSW)24. In particular, the Legal Aid Service submits that the provisions in the Magistrates Act respecting appointment and remuneration deprive the courts of the Territory in which the appointees serve of the character of independent and impartial tribunals. The Local Court is established as a court of record by s 4 of the Local Court Act (NT) ("the Local Court Act"). The jurisdiction conferred upon it may be exercised by a magistrate sitting alone (s 5(1)). Part III of the Local Court Act confers an extensive jurisdiction on the Local Court within a jurisdictional limit of $100,000 (s 3). Further, with respect to summary and indictable offences, s 18 of the Magistrates Act gives to each magistrate the jurisdiction, power and authority to do alone what may lawfully be done by one, two or more Justices under the Justices Act (NT)25 or any other statute. The Legal Aid Service relies upon the analysis by Spigelman CJ of Kable in John Fairfax Publications Pty Ltd v Attorney-General (NSW)26, where his Honour said: "The reasoning of the majority in Kable was not confined to the character of a function or power conferred by a State law. Some of the reasoning encompasses the manner in which a function or power is to be performed. Although Kable was concerned with the compatibility of a 24 (1996) 189 CLR 51. 25 Originally the Justices Ordinance 1928 (NT) ("the Justices Ordinance"). 26 (2000) 181 ALR 694 at 698. McHugh Kirby Hayne Callinan specific non-judicial power (to order imprisonment without any finding of criminal guilt) with the exercise by a state Supreme Court of the judicial power of the Commonwealth, the reasoning of the majority did involve principles of broader application: see Bruce v Cole27." Further, in Ebner v Official Trustee in Bankruptcy28, Gaudron J observed: "Impartiality and the appearance of impartiality are necessary for the maintenance of public confidence in the judicial system. Because State courts are part of the Australian judicial system created by Ch III of the Constitution and may be invested with the judicial power of the Commonwealth, the Constitution also requires, in accordance with Kable v Director of Public Prosecutions (NSW)29, that, for the maintenance of public confidence, they be constituted by persons who are impartial and who appear to be impartial even when exercising non-federal jurisdiction. And as courts created pursuant to s 122 of the Constitution may also be invested with the judicial power of the Commonwealth30, it should now be recognised, consistently with the decision in Kable, that the Constitution also requires that those courts be constituted by persons who are impartial and who appear to be impartial." In his reasons in Ebner31, Kirby J, by reference to Kable, also expressed the view that: "in Australia, the ultimate foundation for the judicial requirements of independence and the requirements of, and implications derived from, Ch III of the Constitution". impartiality rests on 27 (1998) 45 NSWLR 163 at 166. 28 (2000) 205 CLR 337 at 363 [81]. 29 (1996) 189 CLR 51. 30 See Northern Territory v GPAO (1999) 196 CLR 553 at 603-604 [127] per Gaudron J; Re Governor, Goulburn Correctional Centre; Ex parte Eastman (1999) 200 CLR 322 at 336-340 [25]-[36] per Gaudron J, 348 [63] per Gummow and Hayne JJ; cf at 354-356 [84]-[88] per Kirby J. 31 (2000) 205 CLR 337 at 373 [116]. McHugh Kirby Hayne Callinan Counsel for the Legal Aid Service put an argument in three steps. The first is that a court of the Territory may exercise the judicial power of the Commonwealth pursuant to investment by laws made by the Parliament. That proposition, to which there was no demurrer by the Territory or by the Attorney- General of the Commonwealth who intervened in this Court, is supported by the citations of authority by Gaudron J in the above passage from Ebner. It should be accepted. The second step in the Legal Aid Service's argument is that it is implicit in the terms of Ch III of the Constitution, and necessary for the preservation of that structure, that a court capable of exercising the judicial power of the Commonwealth be and appear to be an independent and impartial tribunal. That proposition, which again appears in the passage from Ebner, also should be accepted. The difficulty arises with the third step. This requires discernment of the relevant minimum characteristic of an independent and impartial tribunal exercising the jurisdiction of the courts over which the Chief Magistrate presides. No exhaustive statement of what constitutes that minimum in all cases is possible. However, the Legal Aid Service refers in particular to the statement by McHugh J in Kable32 that the boundary of legislative power, in the present case that of the Territory: "is crossed when the vesting of those functions or duties might lead ordinary reasonable members of the public to conclude that the [Territory] court as an institution was not free of government influence in administering the judicial functions invested in the court". Much then turns upon the permitted minimum criteria for the appearance of impartiality. In that regard, Re Governor, Goulburn Correctional Centre; Ex parte Eastman33 established that s 72 of the Constitution had no application to the Supreme Court of the Australian Capital Territory because that Court was not a court "created by the Parliament" within the meaning of s 72 of the Constitution. It followed that there was no objection based upon the tenure requirement of s 72 32 (1996) 189 CLR 51 at 119; see also at 98 per Toohey J, 108 per Gaudron J, 33 (1999) 200 CLR 322. McHugh Kirby Hayne Callinan to the appointment of an acting judge in that Court. Although in Eastman34 and in earlier cases35 other views have been stated on this subject, for these proceedings the point should be taken as settled. Moreover, it may be added that the absence of a full commission to the trial judge in Eastman did not gainsay the appearance of impartiality. No question arose in Eastman respecting the effect upon that appearance of impartiality and the application of Kable to a series of acting rather than full appointments which is so extensive as to distort the character of the court concerned. No such question arises in this case. Territorial legislatures may be moved to legislate with respect to their courts by considerations extending beyond compliance with constitutional imperatives. Legislation may be designed to further the fact and the appearance Provisions respecting security of remuneration assist that end, as McHugh J pointed out in Harris v Caladine36. judicial determinations. impartial Accordingly, in the present case, the first step, logically anterior to the application of constitutional norms, is to ascertain whether on the proper construction of the Magistrates Act there is evidenced a legislative purpose to advance the status of the magistracy of the Territory in the manner just indicated. When that has been done, the submissions as to invalidity will fall for consideration. The provenance of the Magistrates Act The Magistrates Act is to be construed with several matters in mind. One, already indicated in these reasons, is the statement in the joint judgment in 34 (1999) 200 CLR 322 at 355-356 [88] per Kirby J. 35 For example, in Capital TV and Appliances Pty Ltd v Falconer (1971) 125 CLR 591 at 612-613 per Windeyer J. 36 (1991) 172 CLR 84 at 159. See also Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island; Reference re Independence and Impartiality of Judges of the Provincial Court of Prince Edward Island [1997] 3 SCR 3 at 89-90; Johnston and Hardcastle, "State Courts: The Limits of Kable", (1998) 20 Sydney Law Review 216 at 239-240. McHugh Kirby Hayne Callinan Ebner37 that "fundamental to the Australian judicial system" is the conduct of adversarial trials by an independent and impartial tribunal. Another is the application of that principle in the development of the courts of summary jurisdiction in this country. In 1958, the New South Wales Full Court observed in Ex parte Blume; Re Osborn38: "It is a Departmental rule of long standing that the judicial functions of magistrates are not interfered with by the Department and that it is not competent for the Minister or any member of the Executive to give any direction affecting his judicial functions to a judicial officer." But this was written at a time when it was recognised that the summary courts had origins in England differing from those of the superior courts, deriving ultimately from local courts constituted by justices of the peace and not from the Royal Courts of Justice at Westminster. Thus, in Spratt v Hermes39, which concerned the position of Mr Hermes as a stipendiary magistrate in the Australian Capital Territory, Windeyer J observed40: "The rule that judges hold their offices during good behaviour and not at pleasure is not of general application. It is not part of the common law. It describes an exceptional tenure, one which judicial officers of subordinate courts, for the most part, do not enjoy41. It is therefore not surprising, nor is it contrary to tradition or principle, that the Court of Petty Sessions Ordinance 1930-1961 of the Australian Capital Territory provides for the appointment by the Governor-General of stipendiary magistrates who 'shall be paid such remuneration, and shall hold office on such terms and conditions as the Governor-General determines'." 37 (2000) 205 CLR 337 at 343 [3]. 38 (1958) 75 WN (NSW) 411 at 415. 39 (1965) 114 CLR 226. 40 (1965) 114 CLR 226 at 271-272. 41 See the remarks of Lord Goddard CJ in Terrell v Secretary of State for the Colonies [1953] 2 QB 482 at 495, 496. McHugh Kirby Hayne Callinan The differing origin of the superior and inferior courts was reflected in the circumstances that until quite recent times in Australia magistrates were members of the public services of the States and subjected to the regulation and discipline inherent in that position42. For example, at the time of the decision in Blume, the position in New South Wales was43: "The appointment of magistrates is made under s 49 of the Public Service Act [1902 (NSW)] namely, by the Governor on the recommendation of the Public Service Board. Such an appointment can only be made if the proposed appointee has certain qualifications. A magistrate is an officer of the Department of Justice and the Under-Secretary of Justice is the permanent head of that Department. Magistrates may be dismissed or removed from office for breaches of certain statutory obligations (s 56) and may be suspended by the senior officer of the branch in cases of emergency, otherwise by the permanent head of the Department. The Public Service Board may inquire into cases of suspension, the officer having an appeal from the Board's decision to the Crown Employees' Appeal Board." In the Territory, provision first was made for the appointment of Special Magistrates who were to have, as a condition of eligibility of appointment, not less than five years standing as a solicitor or barrister, by the Justices Ordinance 1928 (NT)44. The legislation was amended by the Justices Ordinance 1973 (NT) to provide for the appointment of a Chief Magistrate. However, throughout this period the magistracy remained members of the public service of the Commonwealth. The enactment in the Territory of the Magistrates Act in 1977 was precipitated by the decision of the South Australian Full Court in Fingleton v Christian Ivanoff Pty Ltd45, delivered on 30 August 1976. Several departments of the public service of South Australia were amalgamated as the Department of 42 See Golder, "The Making of the Modern Magistracy", (1991) 77 Journal of the Royal Australian Historical Society 30 at 35-38. 43 (1958) 75 WN (NSW) 411 at 415. 44 s 10(3)(c). 45 (1976) 14 SASR 530. McHugh Kirby Hayne Callinan Legal Services with the Crown Solicitor being the acting head of the new department. Upon a complaint for an offence coming on for hearing in a court of summary jurisdiction, a question was raised as to whether the Special Magistrate constituting that court was disqualified from hearing the complaint by reason of the fact that in consequence of the amalgamation both the magistrate and a solicitor from the Crown Law Department who prosecuted for the complainant were members of the Department of Legal Services and subject to the same departmental head. In Fingleton, the Full Court held that in the circumstances the magistrate was disqualified by appearance of bias from hearing and determining the "To some minds, it might seem anomalous that a magistrate should be subject to the Public Service Act [1967 (SA)] at all and that in view of the important functions he has to perform, touching so nearly and so often the ordinary life of the citizen in so many aspects, he should be given the same independence and freedom from administrative control as are enjoyed by the Judges of this Court." Thereafter, on 17 November 1976, the Bill for what was to become the Magistrates Act was introduced into the Legislative Council. The need for urgency was said to arise by reason of the recent decision in Fingleton. The "Whilst it is not admitted that the same principle of law necessarily applies in the Northern Territory, it is possible that at some future time some reliance may be placed on the South Australian decision in a Territory court. To avoid the possibility of a decision of the Territory court being held invalid, it is thought desirable that the magistrates should be taken out of the public service at the earliest time." In the Second Reading Speech, it was pointed out that, although the Justices Ordinance did not require magistrates to be members of the Australian public service, they were, at that stage, appointed within that service and came 46 (1976) 14 SASR 530 at 537. 47 Northern Territory, Legislative Council, Parliamentary Debates (Hansard), 17 November 1976 at 772. McHugh Kirby Hayne Callinan under the Attorney-General's Department. Reference was made to the decision of the federal government that the Territory should be left to enact its own legislation respecting the magistracy and that the Territory had been given "the opportunity of legislatively expressing its support for the principle of judicial independence"48. The Bill was said to have two objectives. First, to make it clear that magistrates were to be appointed and hold office independently of the public service and the second to create a satisfactory basis for the appointment of magistrates by giving them a degree of independence and a security of tenure they did not then enjoy49. The Bill was said to contain sufficiently comprehensive provisions to cover all aspects relating to the employment of magistrates, to utilise public service legislation50. thereby rendering it unnecessary The passage of the Magistrates Act thus was part of a movement at that time throughout Australia whereby magistrates achieved a legal status more compatible with judicial independence; for example, Pt 2 of the Magistrates' Court Act 1989 (Vic) provided for security of tenure (ss 11, 12). The Judicial Officers Act 1986 (NSW) subjected all "judicial officers", including judges of all courts of the State and magistrates, to the same disciplinary regime and by s 5(4) included the Chief Magistrate as an ex officio member of the Judicial Commission along with the heads of other courts in New South Wales51. 48 Northern Territory, Legislative Council, Parliamentary Debates (Hansard), 17 November 1976 at 772. 49 Northern Territory, Legislative Council, Parliamentary Debates (Hansard), 17 November 1976 at 771. 50 Northern Territory, Legislative Council, Parliamentary Debates (Hansard), 17 November 1976 at 772. 51 Further provision respecting the advancement of the status of the magistracy was made in 1992 by amendments to the Constitution Act 1902 (NSW), ss 52-54. See also Winterton, Judicial Remuneration in Australia, (1995) at 11-12. McHugh Kirby Hayne Callinan The text and structure of the Magistrates Act It is convenient now to turn to the relevant provisions of the Magistrates Act. An important provision is s 19A. This states: "A Magistrate has, in the performance of his or her duties as a Magistrate, the same protection and immunity as a Judge of the Supreme Court has in the performance of his or her duties as a Judge." Section 4 constitutes "an office of Chief Magistrate" (s 4(1)(a)) and "so many other offices of Deputy Chief Magistrate and Stipendiary Magistrate as the Attorney-General thinks fit" (s 4(1)(b)). The Administrator is empowered by s 4(3) to appoint persons to hold those offices. The Chief Magistrate and each Deputy Chief Magistrate is a stipendiary magistrate (s 4(2)). Provision is made in s 20 for the taking of an oath of office by each person appointed under s 4(3). The oath is to be taken before a judge of the Supreme Court (s 20(2)) in the form of the Schedule to the statute. This provides for the traditional oaths or affirmations of allegiance administered to judicial officers, namely of allegiance and to do right to all manner of people according to law, without fear or favour, affection or ill will. Section 13A empowers the Chief Magistrate to give directions to magistrates including directions as to the places in the Territory where the magistrate is to perform the duties of office (s 13A(1)). However, whilst the magistrate must comply with that direction (s 13A(3)), the Chief Magistrate must not give a direction "for the purpose of affecting the exercise by a Magistrate ... of his or her judicial discretion" (s 13A(2)). A magistrate is not to engage in practice as a legal practitioner (s 11(1)), but the acceptance "of appointment to a judicial office in another Territory" does not affect office under the Magistrates Act (s 11(3)). The professional qualifications for eligibility for appointment are specified in s 5. Section 7 deals with tenure. It states: "(1) Subject to this Act, a Magistrate appointed under section 4(3) holds office until he attains the age of 65 years. (2) A person who has attained the age of 65 years shall not be appointed under section 4(3)." McHugh Kirby Hayne Callinan A magistrate appointed under s 4(3) may resign office by writing, signed and delivered to the Attorney-General (s 8). Section 10 provides in the following manner for removal from office: "A Magistrate appointed under section 4(3) shall not be removed from office unless – he or she has failed to comply with a direction given by the Chief Magistrate under section 13A(1)(b); or the Administrator is satisfied that the Magistrate is – incapable of carrying out his or her duties; incompetent to carry out his or her duties; or (iii) for any other reason unsuited to the performance of his or her duties." The provision of central importance for this appeal is s 6. This states: "Unless and until express provision is made in relation thereto, by or under an Act, a Magistrate appointed under section 4(3) – shall be paid such remuneration and allowances; and holds office on such terms and conditions, as the Administrator, from time to time, determines." Section 6 of the Magistrates Act The opening words of s 6 of the Magistrates Act are apt to include the operation of the Remuneration Act, to which reference has been made. Section 10 of the Remuneration Act empowers the Administrator to request the Tribunal established under s 6 of that Act to inquire into and to report with recommendations on "the remuneration and allowances to be paid to a person or class of persons, and the other entitlements to be granted". The presence of this procedure under the Remuneration Act does not detract from what follows from the balance of s 6 of the Magistrates Act. McHugh Kirby Hayne Callinan Section 6 confers upon a magistrate appointed under s 4(3) the right to receive certain remuneration and allowances and attaches terms and conditions to the office held by the magistrate. The content of the right to receive payment is supplied by the determination by the Administrator. The section does not in terms repose in the Administrator the power or authority to make determinations. However, consistently with a line of authority in this Court52, the provision should be construed as impliedly conferring on the Administrator the statutory authority to make "from time to time" the determinations of which s 6 speaks. That power to make determinations necessarily carries a power of revocation53. Further, in oral submissions it was properly accepted by the Territory that this power to make determinations was attended by a duty to exercise it from time to time "as occasion demands". What those occasions may be involves further questions of construction to which we now turn. Section 6 is to be construed by preferring "a construction that promotes the purpose or object underlying the [Magistrates] Act (whether the purpose or object is expressly stated in the Act or not) ... to a construction that does not promote the purpose or object". The text is that of s 62A of the Interpretation Act (NT). It is with that precept in mind that the phrase in s 6, "from time to time", is to be determined. The purpose or object of the Magistrates Act included the advancement of the standing of the magistracy in the Territory by supporting what in the Second Reading Speech had been identified as "the principle of judicial independence"54. Provisions securing remuneration serve that end and enhance the appearance of impartial decision-making. A construction of s 6 which requires a determination to be made by the Administrator with initial or continued effect at the 52 In re Davis (1947) 75 CLR 409 at 414, 419, 423, 427; Minister for Immigration and Ethnic Affairs v Mayer (1985) 157 CLR 290 at 301-302; Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 273; Kruger v The Commonwealth (1997) 190 CLR 1 at 157; Attorney-General (Cth) v Oates (1999) 198 CLR 162 at 171-172 [16]; A Solicitor v Council of Law Society (NSW) (2004) 78 ALJR 310 at 312 [3]; 204 ALR 8 at 10. 53 In re Davis (1947) 75 CLR 409 at 414, 419, 423, 427. 54 Northern Territory, Legislative Council, Parliamentary Debates (Hansard), 17 November 1976 at 772. McHugh Kirby Hayne Callinan commencement of an appointment by the Administrator under s 4(3) advances the purpose or object of the legislation. A contrary construction promotes the dependence of the magistracy if, indeed, qualified persons were to be found who would accept an office in these circumstances55. The first construction indicated above thus should be accepted. The sequence of events in this case conformed to it. The 1998 Determination was made before and commenced its operation on 9 March 1998, the date on which Mr Bradley's appointment as Chief Magistrate took effect. However, the appointment would, unless Mr Bradley earlier resigned under s 8 of the Magistrates Act, continue for many years, until Mr Bradley attained the age of 65 years (s 7). Yet, the 1998 Determination would have expired long before that event, on 8 March 2000. It is here that the Legal Aid Service contends a fatal deficiency is exposed, an impermissible hiatus. But the phrase "from time to time" is not to be read as permitting the Administrator to fail to exercise the power under s 6 where that failure would produce an hiatus where no determination was in operation. A construction which permitted such a state of affairs would place the officeholder wholly at the favour of the executive government respecting a basic attribute of the judicial independence the legislation was designed to promote. However, as already has been indicated, the 1999 Determinations preceded the end of the initial two year period covered by the 1998 Determination. There was no such hiatus. Upon the proper construction of s 6, none was contemplated or provided for by that section. There is no more effective means of depleting the substance of remuneration to an officeholder than by inattention on the part of the legislative or executive branch of government. Given the different constitutional status of judges appointed under s 72 of the Constitution56, it is unnecessary for present purposes to consider any consequences that might attach to prolonged legislative inattention to the refixing of the "remuneration" spoken of in s 72(iii). That is not an issue here. To the contrary, where a determination has been made under s 6 of the Magistrates Act for a limited period, as in this case, the Administrator 55 cf Buckley v Edwards [1892] AC 387 at 396-397. 56 The Federal Magistrates Court is created by s 8 of the Federal Magistrates Act 1999 (Cth) as a federal court under Ch III of the Constitution. McHugh Kirby Hayne Callinan is required to make a subsequent determination in the manner described above. The purpose or object of the exercise of that power, consistently with that of the statute, cannot be to diminish that which has been provided already; it must be to continue or to enhance that provision. It should be added that the phrases "remuneration and allowances" and "terms and conditions" have a fairly broad meaning. In Austin v The Commonwealth57, the view was expressed in the joint reasons of the majority that the term "remuneration" in s 72(iii) of the Constitution includes non-contributory pension plan entitlements. The other members of the Court accepted as much or treated the term in the same way58. No question arises in this case respecting the overall effect on Mr Bradley of the differences between the 1998 Determination and the 1999 Determinations. The position thus is reached that the premise upon which the Legal Aid Service based its argument, namely that Mr Bradley took up his office with no rights secured under s 6 beyond 8 March 2000, is not made good. To the contrary, the obligations which the legislation imposed upon the Administrator conferred rights upon Mr Bradley, cognisable, if need be, by procedures for administrative review under the general jurisdiction conferred upon the Supreme Court of the Territory by the Supreme Court Act (NT). It should be added that the construction given to the power conferred upon the Administrator by s 6 of the Magistrates Act is not determined by what was decided in Day v Hunkin59, to which reference was made in submissions. This Court there held that a power of determination of salary of an officeholder under the public service legislation of South Australia, the chairman of the Pastoral Board of that State, was not spent upon its first exercise. However, the subsequent exercises of power, which were upheld, reduced the chairman's salary. The considerations which influenced the construction given that public service legislation are indicative of the very concerns later manifested in the Magistrates Act to remove the magistracy from the public service structure. 57 (2003) 77 ALJR 491 at 510 [72] per Gaudron, Gummow and Hayne JJ; 195 ALR 58 (2003) 77 ALJR 491 at 493 [3] per Gleeson CJ, 533 [206] per McHugh J, 542 [249] per Kirby J; 195 ALR 321 at 323, 378, 390. 59 (1938) 61 CLR 65. McHugh Kirby Hayne Callinan Conclusions The Legal Aid Service submitted that, even if the Magistrates Act were to receive the construction which it has been given in these reasons, the third step of its argument would apply and there would have been a legislative failure to provide a minimum characteristic of an independent and impartial tribunal for the adjudication of adversary litigation. That would visit invalidity upon the appointment of Mr Bradley. The suggested failure of the legislation was said to arise from the need to construe s 6 in its context. The legal context was the principle of securing, as Drummond J put it in his dissenting judgment in the Full Court60, "to the greatest extent consistent with its language, the independence and impartiality of magistrates". The "factual" context was said to include the immediately preceding history of relations between the executive government and judiciary in the Territory. What Black CJ and Hely J had said were the "widely publicised" circumstances of the resignation of Mr Bradley's predecessor as Chief Magistrate over differences concerning the system of mandatory sentencing then in force in the Territory61, and the apparently special and advantageous but short term conditions of appointment negotiated by the executive government with There was a concession that it was inessential that the remuneration payable to the Chief Magistrate be charged upon the "public moneys of the Territory" provided for in Pt V of the Self-Government Act (ss 43-48). Nor did counsel appear to disavow the statement by the Supreme Court of Canada in Ell v Alberta62 that "less stringent conditions are necessary in order to satisfy [the] security of tenure" of inferior courts. The ultimate submission by the Legal Aid Service was that, alike with what was said to be the effect of s 72(iii) of the Constitution, an appointee to the office held by Mr Bradley should be "from the moment of appointment secure in 60 (2002) 122 FCR 204 at 262. 61 (2002) 122 FCR 204 at 208. 62 [2003] 1 SCR 857 at 874. McHugh Kirby Hayne Callinan the knowledge that throughout the tenure there will be remuneration and that no action on the part of the Executive is necessary to secure that" (emphasis added). But, as already indicated, it is sometimes the case that the very absence of action by the legislature or executive that serves over time to deplete the substance of the benefits secured by that remuneration. It is true that, however unlikely that eventuality in practice, an officeholder under the system established by the Magistrates Act may be placed in the position of seeking the aid of the Supreme Court to compel observance of the obligations of the Administrator under s 6. But that circumstance does not render the magistracy of the Territory or the office of the Chief Magistrate inappropriately dependent on the legislature or executive of the Territory in a way incompatible with requirements of independence and impartiality. It does not compromise or jeopardise the integrity of the Territory magistracy or the judicial system63. Nor is it apt to lead reasonable and informed members of the public to conclude that the magistracy of the Territory was not free from the influence of the other branches of government in exercising their judicial function64. To the contrary, the legislative requirement of continued attention by the executive of the Territory to the preservation of adequate remuneration of the magistrates, including the Chief Magistrate, is apt to defend the interests of judicial independence and impartiality which inform the legislation. Orders The appeal should be dismissed. The reasons given above for that outcome do not fully take the path of those in the Full Court of the Federal Court. The settlement of the true construction of the provisions of the Magistrates Act is a matter of great importance for the judicial structure of the Territory. In all the circumstances, there should be no order as to the costs of the appeal in this Court. Necessarily, the orders made in the Full Court of the Federal Court will stand. 63 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 107, 117, 64 cf Ell v Alberta [2003] 1 SCR 857 at 874-875.
HIGH COURT OF AUSTRALIA TERRENCE JOHN DIEHM & ANOR APPELLANTS AND DIRECTOR OF PUBLIC PROSECUTIONS (NAURU) RESPONDENT Diehm v Director of Public Prosecutions (Nauru) [2013] HCA 42 30 October 2013 ORDER An extension of time to appeal be granted. Appeal dismissed. On appeal from the Supreme Court of Nauru Representation S J Lee for the appellants (instructed by Gadens Lawyers) P J Hannebery for the respondent (instructed by Department of Justice and Border Control – Republic of Nauru) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Diehm v Director of Public Prosecutions (Nauru) Criminal law – Practice and procedure – Duties of prosecutor – Duty of prosecutor to call all material witnesses – Appellants convicted of rape – Only one of two police officers who attended scene called to give evidence – Whether failure of prosecutor to call second officer occasioned miscarriage of justice. Criminal law – Practice and procedure – Statutory power and duty of trial judge to call witness of own motion – Scope of duty – Whether evidence of uncalled witness "essential to the just decision of the case". Criminal law – Evidence – Depositions – Statement of uncalled witness not in evidence – Trial judge referred to statement to determine effect of failure to call witness – Whether reference to statement occasioned breach of natural justice. Words and phrases – "essential to the just decision of the case", "fair trial", "material witness", "miscarriage of justice". Criminal Code (Q), ss 7, 348. Criminal Procedure Act 1972 (Nauru), ss 100(1), 188. Laws Repeal and Adopting Ordinance 1922 (Nauru), s 12. FRENCH CJ, KIEFEL AND BELL JJ. Introduction On 14 June 2011, the first and second appellants, who are husband and wife respectively, were charged with the rape, on that day, of a woman regarded by custom as the wife's niece, contrary to ss 7 and 348 of the Criminal Code (Q) ("the Code"). The Code as it stood on 1 July 1921 is applied as the law of the Republic of Nauru by virtue of s 12 of the Laws Repeal and Adopting Ordinance 1922 (Nauru). Each of the appellants pleaded not guilty in the District Court of Nauru on 2 August 2011. Following the entry of their pleas of not guilty and a preliminary inquiry in the District Court of Nauru, the appellants were committed to trial in the Supreme Court of Nauru. The trial was by judge alone, as required by s 188 of the Criminal Procedure Act 1972 (Nauru) ("the CPA"). The charges were tried by Eames CJ between 23 and 28 November 2011. The appellants were represented by a person who appeared as a "pleader", having completed a course conducted by the judiciary in Nauru. He had no law degree and was not admitted as a legal practitioner. On 29 November 2011, the trial judge delivered reasons for judgment in which he found both appellants guilty as charged1. On 15 March 2012, the appellants instituted an appeal in this Court against their convictions pursuant to the Nauru (High Court Appeals) Act 1976 (Cth) ("the Nauru Appeals Act"). The appellants complain primarily of the failure of the prosecutor to call certain police witnesses and make them available for cross-examination, the failure of the trial judge to call a particular witness on his own motion, and the trial judge's reference in his judgment to a statement prepared by that witness which was not in evidence. The appellants have sought an extension of time to appeal against their convictions. That extension should be granted. The appeal should be dismissed. The prosecution has a duty to call all material witnesses. The decision whether or not to call a particular witness is a matter for the discretion of the prosecutor. No miscarriage of justice is shown to have arisen from the failure by the prosecutor to call any of the police witnesses he could have called. While the trial judge had a statutory power to call a witness not called by the prosecution2, in this case he had no duty to do so. Absent any miscarriage of justice flowing from the prosecution's failure to call the witnesses, it cannot be said that any miscarriage of justice flowed from the failure of the trial judge to exercise that power. His Honour's consideration of a 1 Republic v Diehm [2011] NRSC 24. 2 CPA, s 100(1). Bell written statement, not in evidence, prepared by a police officer who was not called was evidently undertaken in order to determine whether the failure to call that officer could have given rise to a miscarriage of justice. The parties had notice of his Honour's reference to that document during closing argument. It was clear that his Honour did not treat the statement as evidence and that there was no breach of procedural fairness or miscarriage of justice flowing from his reference to it. The trial — the prosecution case The record of the proceedings in the Supreme Court of Nauru, which was before this Court, did not include any information in the Supreme Court setting out the charges against the appellants as required by s 180(1) of the CPA. No point was taken in this Court about that deficiency. The only initiating process on the record was the charge laid in the District Court of Nauru. In particular, there was no record of a list of prosecution witnesses, although witness depositions were evidently provided to the appellants prior to the trial. The prosecution case, as opened to the Supreme Court by the Director of Public Prosecutions, was that the first appellant was the principal and the second appellant an accessory to rape constituted by intercourse to which the complainant had consented, but in which her consent was given only by virtue of threats or intimidation. The prosecution alleged that, on Sunday, 12 June 2011, the complainant was taken by the police to the appellants' residence following a quarrel with her boyfriend at a house in a place called "Location". She arrived at the appellants' house in the afternoon, drank beer for a time, and left at about 8 pm to have drinks with friends back at Location. She returned to the appellants' residence at about 8 am on Monday, 13 June and went to sleep. She woke up at about 3 pm when the appellants' children arrived home after school. The complainant and the second appellant began drinking together. In the course of conversation, the second appellant suggested to the complainant that she should have sex with the first appellant. This suggestion was rejected. Later, after the first appellant returned from work, the appellants and the complainant went for a drive around the island. When they returned, the children were no longer at the house. They continued drinking. The first appellant then left the house to take clothes to the children. While he was away, the second appellant again suggested to the complainant that she should have sex with the first appellant, a proposition that was again rejected. The prosecution alleged that, following the second appellant's repeated suggestion, the complainant became uncomfortable as she thought the appellants were planning something. At some point in the evening, she borrowed the first Bell appellant's phone and went into the children's bedroom. She made two phone calls to a girlfriend, Eriana, asking her friend to come and pick her up but her friend was not able to do so. Eriana was not called as a witness in the case. The complainant's next phone call was to her mother. She complained that the second appellant was trying to force her to have sex with the first appellant. She called her mother from the same room about 10 or 20 minutes later. During her phone call she was seated on the floor with her feet against the door to the bedroom. The second appellant forced open the door and entered the room with a knife in her left hand. The prosecution case was that the knife was held up to the complainant's face and that she was told to go into the living room. There was a mattress on the floor of the living room and the first appellant was lying on it. The second appellant then told the complainant to lie on the mattress next to the first appellant. Both appellants then removed the complainant's clothing. The first appellant got on top of the complainant and had sexual intercourse with her. The second appellant sat on a settee brandishing her knife and urging the first appellant on. After the first appellant had had sexual intercourse with the complainant, the second appellant performed cunnilingus on her. The complainant then got up, picked up her clothes and the telephone and went into the toilet, where she made a further call to her mother. She told her mother that she was too late and that the appellants had got what they wanted. The prosecutor told the Court that he would be calling the complainant, the police officers who went to the appellants' residence in answer to the mother's call and four more officers who "went to process" the crime scene, took photographs and searched it. The complainant's mother was also to be called as a witness. The complainant, who was the first witness called by the prosecution, gave evidence, through an interpreter, generally along the lines of the prosecution case as opened. She said that on the afternoon of Monday, 13 June, after the appellants and the children had come home, the first appellant took the children to Location. The second appellant remained. While the two of them were drinking whisky together, the second appellant told her that the first appellant had had sex with a number of women. She asked the complainant if she would be happy to have sex with him. Later, the second appellant said she was only joking. After the first appellant returned, they all drank whisky together for two or three hours. They then went for a drive at about 5 pm. They returned to the appellants' house. The first appellant then said that he was going back to Location to take some clothes there for the children. The trial judge was to find Bell that the decision was made abruptly to ensure that the children did not come back to the house overnight3. When the first appellant returned, he asked the complainant if she would like to go to Australia with him and his wife. He said she would have to pay her own fares. The complainant's evidence thereafter went on to describe the sequence of events for which the appellants were charged and her retreat with the first appellant's mobile telephone into a toilet at the appellants' home after those events. The complainant said that, after telephoning her mother from the toilet, she switched the phone off. She stayed in the toilet for 20 to 30 minutes and then heard people talking outside. Two police officers, who had responded to the call by her mother, had arrived at the front door of the appellants' house. She came out and saw the officers. They were talking to the appellants. When she saw the police she began crying and they asked her to follow them outside. She told the officers that the appellants had "done something wrong to me." She said that she explained to the police officers what the bad thing was when she got into the police car. She told them that the first appellant had tried to have sex with her while the second appellant had a knife in her hand. The officers took her and the first appellant away in their car, dropped him off at the police station4, went back to the house and picked up the second appellant and took her to the police station, and then took the complainant to the hospital. The complainant denied an allegation put to her in cross-examination that she had had consensual intercourse with the first appellant on two occasions on 12 June. She also said in cross-examination that when she returned to the appellants' house with the police she pointed out the mattress, which was still on the floor in front of the television. She denied that she had pulled the mattress into that location herself. The complainant was cross-examined about telephone conversations she had after the events of 14 June 2011. In one of the conversations she was said to have told the caller, Cilia Boarta, who was called as a defence witness, that she was at the house helping police to look for the knife with which she was threatened. She said she did not remember the conversation. However, she did remember seeing the knife in the kitchen and telling the police officers to go and look for it there. She denied having a telephone conversation with someone [2011] NRSC 24 at [135]. 4 Referred to in some parts of the transcript as the "correctional centre". Bell called Rose Igii, also called as a defence witness, in which she had allegedly offered to withdraw the charges if the appellants bought her an airline ticket. The complainant's mother gave evidence of the telephone conversations she had had with her daughter. She also spoke through an interpreter. She confirmed that her daughter had said that she was going to be forced to have sex with the first appellant. During the second telephone call, she could hear the second appellant's voice calling out to her daughter to open the door. She then called the police and told them to go to the appellants' place. She told them her daughter was afraid to leave the room and go to the lounge room because the doors of the house were locked. The last call from her daughter came about half an hour or 20 minutes after she had called the police. She told the complainant that the police were on their way. The prosecution then called one of two police officers who had attended at the appellants' house, Senior Constable Decima Deireragea, who was evidently an acting sergeant at the time. She said she was on duty in a police vehicle with Constable Dillon Harris at about midnight on 14 June 2011 when they were contacted by a colleague from the police station to say a report had been received from the complainant's mother. Senior Constable Deireragea said she and Constable Harris drove to the appellants' house. When they arrived there everything was locked up and the curtains were closed. They knocked on the front door several times and for about ten minutes no one answered. The second appellant then opened the front door. Senior Constable Deireragea said that she asked the second appellant if there was anyone else in the house. The second appellant replied that only she and her husband were there. The first appellant then came to the door. He was wearing just a towel around his waist. Senior Constable Deireragea asked both of them if the complainant was in the house. They both said no. The second appellant told her that the complainant had left the house that afternoon. The complainant then appeared behind the two appellants. When Senior Constable Deireragea asked the second appellant who was the person behind them, the second appellant turned around and said "oh that's [the complainant] that's her". Senior Constable Deireragea asked the second appellant why she had given false information. The second appellant then started to raise her voice. Both appellants then turned back and went inside the house. The complainant then identified herself to the police officers. She was shaking and crying. She looked scared. She came outside the house. According to Senior Constable Deireragea, the complainant said her mother was to blame for what had happened. She said she was forced to have "sexual intercourse with a 66 year old man". The second appellant had forced her to have sexual intercourse with the first appellant and had threatened her with Bell a knife. The second appellant held the point of the knife to her neck. Senior Constable Deireragea said that she was in the police car with the complainant when she said this. She had taken her out of the house to make her feel more comfortable about giving a statement. Senior Constable Deireragea told the Court that she then entered the house and told the first appellant that he was going to be arrested for rape. Constable Harris was standing at the front door while she did so. Senior Constable Deireragea told the second appellant that they would take the first appellant to the police station and would be back for her. Senior Constable Deireragea testified that after she and Constable Harris had taken the first appellant to the police station, they drove back to the house with the complainant. The second appellant was then taken to the police station. The police returned to the house with the complainant. Photographs were taken by another police officer, Constable Namaduk, who arrived later. The complainant showed the police officers where the incident had occurred in the lounge room. There was a mattress on the lounge room floor. The complainant showed the police officers a knife in the kitchen area. It was on top of a shelf. The knife had a black handle about four or five inches long and a blade about eight inches long. There was a laptop computer lying on one of the chairs in the lounge room facing the mattress, which the police seized. The complainant showed the police around the house including a small room in which she said she had tried to lock herself. Senior Constable Deireragea said in cross-examination that she had no search warrant at the time they revisited the house with the complainant. In cross-examination, Senior Constable Deireragea was asked if Constable Harris had inquired, on first arriving at the house, whether or not the appellants had a Nauruan lady locked up in their house and whether they had answered "no" to that question. Senior Constable Deireragea denied that either she or Constable Harris had asked that question. On the second day of the trial, 24 November 2011, the prosecutor informed the Court that he intended to call the complainant's friend whom she had phoned before phoning her mother, a pharmacist, and a gynecologist, Dr Castanedo, who was tied up with an operation. The appellants' pleader then said: "My apologies Your Honour, just also I'm asking that there's another police witness PC Dillon, yes I've asked my learned friend also to make sure he was on." The transcript records his Honour as saying: "Yes, police PC Dillon was an essential witness". Bell The prosecutor said that Constable Harris was being called to court. The prosecutor called Constable Dan Botelanga, who had searched the house and taken photographs from about 2.30 pm on Tuesday, 14 June 2011. He had attended at the house with two other officers, Senior Constable Dacor, who did a sketch of the house, and Sergeant Scarist, who took notes. Constable Botelanga was operating under the authority of a search warrant. He recalled seeing a mattress in the living room. In his examination-in-chief, he said that there had been police officers at the house earlier that day, namely Senior Constable Deireragea, Constable Harris and Constable Namaduk, who also took photographs. He did not know what had happened to their photographs. He said that in one room they found some sex toys and DVDs, and some pills. He denied that he and the other officers had moved any items around so they could take photographs. He was specifically referred to a pair of women's panties on the floor. The next witness was Dr Leweni Mocevakaca, a senior pharmacist at the hospital. He gave evidence identifying tablets seized at the house as containing sildenafil citrate, for the treatment of erectile dysfunction. He gave evidence of the duration of their effectiveness after being consumed. The next witness was a probationary constable, Joni Ratabwiy, who took the call from the complainant's mother in the early hours of 14 June 2011. When Constable Ratabwiy's evidence was completed the following exchange took place between the prosecutor and the trial judge: "DPP:Your honour my friend did ask that Constable Dillon be called. I have just been informed that Constable Dillon is at the moment indisposed he is involved in a domestic dispute and is considerably under the influence of alcohol, the police were unable to bring him to court this morning Court:alright what are you suggesting I do? counsel has asked to have him here for cross examination DPP:yes your honour, well I would in the circumstances ask for a very short adjournment for me to ascertain whether Dr Maribel Castanedo is available to come and give evidence Court:alright we'll take a short break but as far as Mr Dillon is concerned he's obviously not going to be available so you might want to consider over the break what you want to do about that". The Court resumed after the above exchange and heard evidence from Dr Castanedo. The girlfriend whom the complainant had called from the appellants' house was not called as a witness. The prosecution closed its case. It Bell was at this point that the question of whether Constable Harris was to be called as a witness should have been resolved. That would have been consistent with the general rule that the prosecution must offer all its evidence before the accused is called on to make his or her defence5. However, the question of Constable Harris was simply not addressed. On that topic a puzzling silence descended upon the record. There is no record on the transcript of any reference to Constable Harris at this point. The trial — the defence case The appellants' representative opened the case for the defence briefly. The witnesses for the defence were the first appellant and two women who had had conversations with the complainant after the event. The first appellant testified that he had had consensual sex with the complainant previously, on 21 May 2011. At that time the complainant had asked that the appellants, who were due to go to Australia for holidays on 13 July 2011 for a family reunion, take her with them. She said she had had a baby but had sold it. She wanted to get the baby back. The complainant had been told that she would have to pay her own way. Turning to the events of 12 June 2011, the first appellant said that the complainant had been brought around to the appellants' house between 9 am and 9.30 am. He was told that she had been bashed by her boyfriend and had rung the police, who had brought her around to the appellants' place. The first appellant went to work until midday. The complainant drank beer in the afternoon and went to bed that evening. The first appellant said he went to bed between 7.30 pm and 8 pm. When he woke on the morning of Monday, 13 June, the complainant had gone. The first appellant went to work. At lunchtime he picked up the second appellant and their son from pre-school. When they got back to their home, the complainant was there. The first appellant went back to work. He picked up another child from school at about 3 pm, and on his return home found his wife and the complainant drinking whisky together. At about 4.30 pm he took the children to Location so they could have a sleep-over with their friends. The first appellant said that after he returned home, he started drinking beer. The second appellant went for a shower at about 6 pm. The complainant suggested he and she have intercourse, which they did. Later, after his wife had 5 R v Soma (2003) 212 CLR 299 at 309 [29] per Gleeson CJ, Gummow, Kirby and Hayne JJ; [2003] HCA 13. Bell finished her shower, the three of them went for a drive. They got back to the appellants' house at about 7.30 pm. Later that night, at about 11.30 pm, the complainant, according to the first appellant, said that the appellants hated her, they wouldn't help her with her baby and they wouldn't take her to Australia. The second appellant then took the complainant to their daughter's bedroom at about ten to midnight. About 15 minutes later, the first appellant told his wife to go and check on the complainant because she was very drunk. He could hear his wife asking the complainant to open the door. He heard the complainant give a little yelp or scream and then both of them came out about five minutes later, laughing and joking. The complainant asked for more whisky. The first appellant gave her a tumbler. At about this time the police came knocking on the door. The first appellant said that when the police arrived Constable Harris asked him if he had a Nauruan girl locked up in the house. The first appellant said that he replied, "There's no one locked up in this house." He said his wife was standing back over near the dining room table and Constable Harris was about one and a half paces inside the house. Senior Constable Deireragea was outside the house. She asked the second appellant if they had somebody locked up and mentioned the complainant by name. The first appellant said that when the police arrived the complainant had told the appellants that her boyfriend had sent the police. She ran into the hallway. However, when the police mentioned her name she came out of the hallway and onto the porch. She wasn't crying. The first appellant said that when the police arrived he was wearing a green lava- lava with the word "Kiribati" on it and underpants underneath. He denied that he was wearing a towel at the time as claimed by Senior Constable Deireragea. In cross-examination, the first appellant said that he thought the police had come to the house in connection with the incident between the complainant and her boyfriend. He believed that Constable Harris was related to the complainant. Asked whether he told the police officers that the complainant was not in the house, he said: "Because they said you've got a girl locked up in the house and I stated no we have no one locked up and they asked my wife and she said no and before we could say anything [the complainant] walked out of the passage way". Pressed on what Senior Constable Deireragea had said, the first appellant said that he felt the officers were not telling the truth. He maintained that he just told the police officers there was no Nauruan girl locked up in the house. He did not consider the complainant as a Nauruan girl because he thought of her as "a Kiribas", that is, someone from the Republic of Kiribati. He did not hear any officer ask simply whether there was anyone else in the house. Bell Two other defence witnesses were called. Cilia Boarta gave evidence of two telephone conversations with the complainant in the early hours of 14 June 2011 after the first appellant had been taken away by police. She said that in the first of those conversations the complainant had told her that the police were coming back to try and get fingerprints from a knife in the kitchen. In the second telephone conversation, the complainant told her that she and the police were at the house "imitating" what had happened with the knife. According to the witness, there was laughter in the background. Another defence witness, Rose Igii, gave evidence of a conversation with the complainant about a week after the alleged offences. She said the complainant told her in the course of that conversation to pass on to the appellants that if they bought her a ticket to Tarawa she would withdraw the case. The witness said that when this offer was conveyed to the appellants they would not accept it. The complainant had denied this conversation. The prosecution did not cross-examine Ms Igii. The defence case then closed. There was no further request for Constable Harris to be called. Constable Harris' witness statement An unsigned copy of a statement of Constable Harris, entitled "Police Report", had been provided to the defence prior to trial under cover of a Disclosure Certificate. It was among a number of witness statements and potential exhibits provided "by way of Disclosure of the Prosecution Case". It was not tendered in evidence. Absent agreement, it could not have been admitted. It began with a statement that at about 2400 hours on 14 June the police had received a complaint "regarding a young lady locked up in a dwelling house". Constable Harris said that he and Senior Constable Deireragea went to the appellants' house, knocked on the door several times and called upon any person inside the dwelling. The statement continued: "We were then attended by a Mr Terrance Di[e]hm Australian nationality and when Mr Di[e]hm opened the door i saw Mr Di[e]hm was wearing only a towel and no shirt, inside the living area and a lady was sitting at the dinner table. Sgt Decima then informed Mr Di[e]hm that there was a report at his dwelling regarding a lady being locked up in his dwelling. Mr Di[e]hm then stated that there was no lady locked up inside her dwelling, the lady who was sitting at the dinner table then approached us and asked why was the police at their dwelling; i saw that the lady was Bell intoxicated with alcohol due to her reddish eyes and strong smelt of alcohol coming from her breath, Sgt Decima asked Mr Di[e]hm who this lady was and he Mr Di[e]hm stated that she was his wife." The statement then recounted that Senior Constable Deireragea had asked if the complainant (whom she named) was at the dwelling. According to the statement, the second appellant said that the complainant was staying with them and had gone out. Constable Harris then saw a woman come out to the living area. Senior Constable Deireragea asked who she was, and the second appellant said that she was the complainant. The appellants went into the living area lounge and sat on the couch, leaving the two officers at the front door. The complainant then approached and Constable Harris heard her say that "it was too late he (Mr Di[e]hm) had already got what he wanted". According to Constable Harris' statement, the complainant was crying and scared. Senior Constable Deireragea then told the complainant not to be frightened and to tell her what had happened. Constable Harris waited for Senior Constable Deireragea while she was talking to the complainant and after a "few seconds" the Senior Constable directed him to arrest the first appellant. He did so and told the first appellant to put some clothes on as the police would be taking him in. Constable Harris' statement said that after taking the first appellant to the police station to be detained both officers returned to the dwelling and informed the second appellant that she would be arrested for aiding her husband. The second appellant was very drunk and when they told her about the rape she said to Senior Constable Deireragea, "Sex its only sex". The statement went on to report that Constable Harris, Senior Constable Deireragea, Constable Namaduk and the complainant returned to the appellants' house to get the complainant's clothes and so Constable Namaduk could take photographic evidence at the crime scene. Photographs were taken and various parts of the house searched. Pornographic videos and two vibrators were found. Subsequently, according to Constable Harris' statement, he and fellow officers took the complainant to hospital for a medical checkup. The trial — closing addresses The prosecutor and the appellants' pleader delivered their closing addresses on 28 November 2011. A transcript of those addresses was before this Court. In the course of his closing submissions, the prosecutor referred to the appellants' statements to Senior Constable Deireragea and Constable Harris that the complainant was not at their house. He accepted the trial judge's observation that he relied on that evidence heavily as evidence of consciousness of guilt. His Honour referred to Constable Harris as the corroborator to Senior Constable Deireragea and said: Bell "He did not give evidence for the reasons we know." The trial judge then informed the parties that he had looked at Constable Harris' statement the previous night. He said: "I know that it's not strictly before me, but as a matter of fairness I thought I should raise this." He then referred to the part of Constable Harris' statement in which he said Senior Constable Deireragea told the first appellant that there had been a report that there was a woman locked up inside his house. The trial judge linked that with the evidence of the probationary constable who received the mother's telephone call and who recorded in the log that she had been told by the mother that the complainant was locked up in the house. His Honour observed: "Now we've got a drunken Constable Dillon Harris who is unfit to give evidence before the court. How can the prosecution invite the court to rely on the evidence of Senior Constable Deireragea, however honestly it might have been given. How can you as Director invite the court to accept that evidence and reject [the first appellant's] account in light of this statement of Senior Constable Harris?" His Honour posed the question: "How can I be satisfied beyond reasonable doubt, that the conversation was not one which was capable of being interpreted as 'we're asking you if someone is locked up in the house' and they were replying 'no there's no one locked up in the house'." The prosecutor responded that Senior Constable Deireragea's version of events made more sense than the version in Constable Harris' statement. His Honour asked the prosecutor how he could ignore the fact that Senior Constable Deireragea's version was inconsistent with that of the witness who was not called. The prosecutor submitted that even if the appellants' version of the initial question were accepted, Senior Constable Deireragea's evidence was that she had asked them three times about the complainant. They could easily have responded that the complainant was in the house. The appellants' pleader said that Senior Constable Deireragea's evidence of what had been said should not be accepted without Constable Harris' confirmation of it. He also submitted that Constable Harris would have given evidence going to the complainant's state of intoxication at the time of the police visit. Bell The submissions and exchanges in closing addresses did not include any suggestion by the trial judge or either of the representatives at the bar table that anything should then be done to arrange for Constable Harris to be called as a witness. The focus of the argument was whether his absence meant that the trial judge could not be satisfied beyond reasonable doubt on matters vital to a verdict of guilty against the appellants. This was reflected in the way that the trial judge dealt with Constable Harris' statement in his judgment. The judgment The trial judge reviewed the evidence carefully and comprehensively. He noted that the police log of the phone call from the complainant's mother to the police station did not report a complaint of rape or threatened rape6. The log recorded that the complainant's mother "needed police assistance to check her daughter [who] has called her a minute ago and told her that she was locked up in the house by the couples Mr and Mrs Diehm"7. His Honour observed that the report that the complainant was locked up in the house added some credibility to the evidence of the first appellant that he was asked by the police officers whether there was a Nauruan woman locked up in the house. On the other hand, the fact of the phone call being made added credibility to the complainant's evidence that she was not consenting to anything and regarded herself as The trial judge found the complainant was distressed after the events said to constitute the offences. She had been distressed and fearful when speaking to her mother. His Honour accepted Senior Constable Deireragea's account of the significant degree of distress exhibited by the complainant and of her appearance of being fearful. The first appellant's denial of that distress damaged his credibility9. The trial judge referred to the conflict between the evidence of the first appellant and that of Senior Constable Deireragea as to what was said when the police arrived at the house and, in particular, the first appellant's assertion that the officers asked whether there was a Nauruan locked up in the house. His Honour noted that the conversation between Deireragea and the first appellant took place [2011] NRSC 24 at [49]. [2011] NRSC 24 at [47]. [2011] NRSC 24 at [49]. [2011] NRSC 24 at [72]–[76]. Bell in the presence of Constable Harris, who had been due to give evidence but did not, because of his involvement in a personal domestic dispute and because he was too drunk to come to court10. The trial judge found the evidence of Senior Constable Deireragea to be measured and credible11. His Honour dealt with the absence of Constable Harris and his written witness statement in the following "More importantly, I have examined the statement of Constable Dillon Harris, which was tendered at committal. No application was made to tender his deposition from the committal, pursuant to s 199 of the Criminal Procedure Act 1972, but it is a matter of fairness that causes me to refer to it. In his statement he recorded 'Sgt Decima then informed Mr Diehm that there was a report at his dwelling regarding a lady locked up in his dwelling. Mr Diehm then stated that there was no lady locked up inside her (sic) dwelling' [his Honour's emphasis]. The absence of Constable Dillon Harris has denied the defence the chance to explore that conflict in the evidence of the two police officers. I queried with Mr Kurisaqila whether he could responsibly invite the Court to reject Terry Diehm's account about what was said, and invite me to accept that of Sen Const Deireragea, having regard to what is contained in the statement of the untested witness. The Director submitted that Deireragea asked questions which specifically referred to another person being in the house, and to [the complainant] being in the house, and whether or not the words 'locked up' had been used it was plain that the Senior Constable put clear questions which were met by lies." The trial judge did not receive Constable Harris' statement in evidence, nor did he treat it as such. Counsel for the appellants submitted to this Court that the trial judge had regarded it as a matter of fairness that he assess the effect of Constable Harris' absence from the witness box by reference to the statement which had been tendered at committal, but not at trial. His Honour did not expressly frame his consideration by reference to any prosecutorial duty to call a 10 [2011] NRSC 24 at [77]–[79]. 11 [2011] NRSC 24 at [80]. 12 [2011] NRSC 24 at [83]–[86]. Bell material witness, nor by reference to his own power to call a witness. It can be inferred that he undertook the exercise in order to determine whether any miscarriage of justice would flow from the failure to call Harris. The appellants, in their submissions concerning Constable Harris' statement, relied upon his statement that what was first put to them when the police arrived at their front door was that they had a woman locked up in the house — an accusation which was denied and the denial of which would not have been untruthful. The trial judge observed that the prosecution case would have been strengthened if Constable Harris had given evidence to corroborate Senior Constable Deireragea's evidence. He said he made "full allowance for his absence when weighing the evidence of Deireragea."13 He observed that the defence could no doubt have made much of discrepancies between the evidence of Harris and that of Deireragea, but the failure to call Constable Harris as a witness did not cause his Honour to have any doubt that the second appellant had expressly said "[s]he left earlier in the afternoon" when asked specifically about the complainant14. His Honour found no reasonable alternative explanation than that was a deliberate lie on the part of the second appellant and was told in consciousness of guilt. Even if the words "locked up" had been used at some point by Senior Constable Deireragea, the trial judge would not regard her evidence about what was said as a deliberate lie but more likely a mistake. He accepted that she had asked the appellants if they knew the complainant and that one or other of the appellants said "No. There's no one else here", and, importantly, that they both said "no" when asked, "Is she with you in the house?"15 His Honour concluded16: "Whilst making full allowance for the absence of Constable Dillon Harris, I consider those responses by Terry Diehm were lies told in consciousness of guilt." His Honour found that the complainant must have been significantly affected by alcohol at the time but was capable of communicating, walking 13 [2011] NRSC 24 at [87]. 14 [2011] NRSC 24 at [87]. 15 [2011] NRSC 24 at [88]. 16 [2011] NRSC 24 at [89]. Bell unaided, and participating in a medical examination17. The second appellant was also significantly affected by alcohol but she too was capable of communicating with police and walking18. His Honour did not consider that the evidence disclosed that either appellant was so affected by alcohol as to be incapable of forming the intention to commit or to aid and abet rape19. His Honour referred to deficiencies in the police investigation concerning the knife which the second appellant was said to have used to threaten the complainant. Although the appellants' representative did not have the opportunity to cross-examine police officers in the "first response group", comprising Senior Constable Deireragea, Constable Harris and Constable Namaduk, which had examined the premises, the trial judge attached little credibility to a suggestion by the first appellant that the knife had been planted20. His Honour found the most troubling aspect of the prosecution case was the failure of the prosecution to cross-examine Rose Igii on her claim, which was denied by the complainant, that the complainant had offered to withdraw the case if the appellants purchased an airline ticket for her21. Although his Honour found the complainant's evidence to be generally reliable and believable, he found no reason to disbelieve that of Ms Igii. He then posed the question whether that evidence was "sufficient to raise a reasonable doubt about the guilt of the accused"22. In context, his Honour was referring to the effect of Ms Igii's evidence on the prosecution case as a whole, rather than indicating a view that it was for the defence to raise a reasonable doubt. Indeed, later in his reasons his Honour specifically stated that the first appellant had "no obligation to raise reasonable doubt"23. 17 [2011] NRSC 24 at [95]. 18 [2011] NRSC 24 at [96]. 19 [2011] NRSC 24 at [97]. 20 [2011] NRSC 24 at [113]. 21 [2011] NRSC 24 at [115]–[116]. 22 [2011] NRSC 24 at [120]. 23 [2011] NRSC 24 at [125]. Bell On the assumption that the complainant had made the offer attributed to her by Ms Igii, his Honour said that it was necessary that the rest of the complainant's evidence be very carefully scrutinised. He said24: "Having given it such scrutiny, I remain satisfied that her evidence, corroborated as it has been, carries a strong ring of truth. She was an impressive witness, who did not exaggerate. I accept her version of events surrounding the rape which she alleges took place." His Honour reviewed the first appellant's evidence, which he described as "quite fanciful" and "riddled with implausible accounts of his sexual encounters with the complainant"25. The first appellant's evidence that the complainant had asked him for sex in May 2011 "[j]ust for pleasure, not money" stood in stark contrast to her statement of disgust to the police that "I just had sexual intercourse with a 66 year old man."26 The appellants' decision to take clothes across to their children at Location on the evening of Monday, 13 June 2011 indicated "that a sudden decision had been made to keep them out of the house overnight."27 His Honour was satisfied beyond reasonable doubt that both the appellants had engaged in non-consensual sexual intercourse with the complainant, the first appellant penetrating the complainant's vagina with his penis and the second appellant aiding and encouraging him to do so, holding a knife to ensure that the complainant complied28. The appellants were sentenced to three years and two years imprisonment respectively, dating from 30 November 201129. The grounds of appeal The grounds of appeal were concerned with: 24 [2011] NRSC 24 at [124]. 25 [2011] NRSC 24 at [126]. 26 [2011] NRSC 24 at [126]. 27 [2011] NRSC 24 at [135]. 28 [2011] NRSC 24 at [140]. 29 Republic v Diehm [2011] NRSC 27. Bell the failure of the prosecutor to call as witnesses Constable Harris and other police officers who carried out the first warrantless search of the appellants' house; (Ground 2) the failure of the trial judge to call Constable Harris as a witness of his own motion; (Ground 3) the trial judge's reference to the witness statement of Constable Harris; (Ground 4) the absence of notice to the appellants of the prosecution case with respect to the first appellant's answers to Senior Constable Deireragea and Constable Harris when they first came to the appellants' home on 14 June 2011; (Ground 5 — this ground was not pressed) the consequence in all of the circumstances that a reasonable tribunal of fact could not have concluded beyond reasonable doubt that the appellants were guilty of rape. (Ground 6) The jurisdiction and powers of the High Court in criminal appeals from Nauru Section 5(1) and (2) of the Nauru Appeals Act confer on this Court jurisdiction to hear and determine appeals from the Supreme Court of Nauru. The Nauru Appeals Act confers that jurisdiction in cases in which the Agreement between Australia and Nauru relating to appeals to the High Court from the Supreme Court of Nauru, signed on 6 September 1976, provides that such appeals are to lie30. Article 1 of the Agreement provides that appeals are to lie to the High Court from the Supreme Court in respect of the exercise by the Supreme Court of its original jurisdiction in criminal cases as of right by a convicted person against conviction or sentence. As was explained in Ruhani v Director of Police31, the jurisdiction thus conferred upon the Court is original jurisdiction conferred pursuant to s 76(ii) of the Constitution32. The history and 30 Nauru Appeals Act, ss 3, 5, Schedule. 31 (2005) 222 CLR 489; [2005] HCA 42. 32 (2005) 222 CLR 489 at 499 [7] per Gleeson CJ, 512 [52] per McHugh J, 530 [118] per Gummow and Hayne JJ. Bell background relating to the making of the 1976 Agreement and the passing of the Nauru Appeals Act are also explained in Ruhani33. The powers of the Court on such appeals are set out in s 8 of the Nauru Appeals Act, which applies to the exercise of the Court's jurisdiction under that Act generally: "The High Court in the exercise of its appellate jurisdiction under section 5 may affirm, reverse or modify the judgment, decree, order or sentence appealed from and may give such judgment, make such order or decree or impose such sentence as ought to have been given, made or imposed in the first instance or remit the case for re-determination by the court of first instance, by way of a new trial or rehearing, in accordance with the directions of the High Court." As was pointed out in the judgment of this Court in Amoe v Director of Public Prosecutions (Nauru)34 in hearing an appeal from the Supreme Court of Nauru against conviction35: "the Court is not limited to those grounds for setting aside a conviction which are contained in the common form criminal appeal legislation found in each of the Australian States." That observation was made in the context of the Court's consideration of a ground of appeal that the conviction appealed against was unsafe and unsatisfactory. The fact that the trial was heard by a judge alone and the general expression of the appellate jurisdiction meant that less deference would be accorded to the trial judge's verdict than that which would be accorded to the verdict of a jury. Their Honours said36: "The Court must, of course, act on the principle that, unless the trial judge has failed to use or has palpably misused his or her advantage in seeing and hearing the witnesses, it 'ought not to take the responsibility of reversing conclusions so arrived at, merely on the result of their own 33 (2005) 222 CLR 489 at 502–503 [22]–[23] per McHugh J, 524–525 [95]–[99] per 34 (1991) 66 ALJR 29; 103 ALR 595; [1991] HCA 46. 35 (1991) 66 ALJR 29 at 31; 103 ALR 595 at 598. 36 (1991) 66 ALJR 29 at 31; 103 ALR 595 at 598. Bell comparisons and criticisms of the witnesses and of their own view of the probabilities of the case'. But where any question arises as to the proper inference to be drawn from the facts, it is the duty of this Court to form an independent judgment on that question, since the Court 'is in as good a position to decide [the question] as the trial judge'." (citations omitted) The present appeal does not involve a contention in terms that the conviction was unsafe and unsatisfactory, but does involve the assertion in the final ground that in all the circumstances a reasonable tribunal of fact could not have concluded beyond reasonable doubt that the appellants were guilty of rape. That assertion, however, was based upon the narrow factual question whether there was a mattress on the lounge room floor when the front door of the appellants' house was opened to Senior Constable Deireragea and Constable Harris. It may be noted that the Appeals Act 1972 (Nauru) confers a right of appeal against convictions from the Supreme Court to this Court and purports to confer jurisdiction on this Court to hear and determine the appeal. Section 38(1) confers general powers on the Court which reflect those set out in s 8 of the Nauru Appeals Act. Section 38(2) of the Appeals Act 1972 (Nauru) contains a proviso in the following terms: "The High Court may, notwithstanding that it may be of the opinion that the point raised in an appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has in fact occurred." Those provisions are contained in an enactment of the Nauru Parliament. They were not referred to in argument, nor was there any suggestion that this Court should dismiss the appeal on the basis that, notwithstanding one or more of the grounds might be decided in favour of the appellants, no substantial miscarriage of justice had occurred. The question for this Court is whether, on the basis of any of the grounds of appeal, a miscarriage of justice has occurred. Failure to call material witnesses The appellants submitted that Constable Harris was a material witness and that the prosecution's failure to call him as a witness was a breach of its duty which deprived the appellants of a chance of acquittal. They argued that a similar consequence flowed from the failure to call the police who attended the premises as part of the first response team and who examined the premises without the benefit of a search warrant. This can only have been a reference to Constables Harris and Namaduk, who attended the premises with Senior Bell Constable Deireragea and the complainant, took photographs and found the knife which the complainant said had been used to threaten her. A loss of a chance of acquittal was said to have arisen from the failure to call Constable Harris because of the appellants' inability, in his absence, to challenge evidence upon which the trial judge acted in finding that the first appellant's responses to Senior Constable Deireragea were lies indicating a consciousness of guilt. The appellants also said that they had lost a chance to exploit a discrepancy between Harris' evidence and that of Senior Constable Deireragea on whether the complainant had given a statement to Deireragea in the police car, after which Deireragea arrested the first appellant for rape. That discrepancy was said to go to the issue of whether there had been a recent complaint and whether the complainant was distressed in a way that corroborated her evidence. A further discrepancy, linked to the failure to call Constables Harris and Namaduk as members of the first response team, was said to be relevant to the warrantless search and the location of items seized from the house as potential exhibits. That was said to go to the allegation that the police had positioned physical evidence to support the complainant's account of what had happened. It is well established that the prosecutor in a criminal trial conducted under the adversarial system of criminal justice must act "with fairness and detachment and always with the objectives of establishing the whole truth in accordance with the procedures and standards which the law requires to be observed and of helping to ensure that the accused's trial is a fair one"37. The objective of a fair trial requires the prosecutor to call all available witnesses unless there is some good reason not to do so. Mere apprehension that testimony of a particular witness will be inconsistent with the testimony of other prosecution witnesses is not a good reason for not calling that witness38. Nor is it a good reason that the witness is regarded as "in the camp of" the accused39. 37 Dyers v The Queen (2002) 210 CLR 285 at 293 [11] per Gaudron and Hayne JJ; [2002] HCA 45, quoting Whitehorn v The Queen (1983) 152 CLR 657 at 663–664 per Deane J; [1983] HCA 42 (their Honours' emphasis). 38 (2002) 210 CLR 285 at 293 [11] per Gaudron and Hayne JJ. 39 MFA v The Queen (2002) 213 CLR 606 at 629 [81] per McHugh, Gummow and Kirby JJ; [2002] HCA 53. Bell In R v Apostilides40 this Court set out a number of propositions applicable to the conduct of criminal trials in Australia which are generally apposite to the conduct of a trial before a judge sitting without a jury in Nauru41: The prosecutor alone bears the responsibility of deciding whether a person will be called as a witness for the prosecution. The trial judge may, but is not obliged to, question the prosecutor in order to discover the reasons which led the prosecutor to decline to call a particular person. He or she is not called upon to adjudicate the sufficiency of those reasons. 3. While at the close of the prosecution case the trial judge may properly invite the prosecutor to reconsider such a decision and to have regard to the implications as then appear to the judge at that stage of the proceedings, he or she cannot direct the prosecutor to call a particular witness. 4. When charging the jury, the trial judge may make such comment as he or she then thinks to be appropriate with respect to the effect which the failure of the prosecutor to call a particular person as a witness would appear to have had on the course of the trial. Any such comment will be affected by such information as the prosecutor has provided relating to the reasons for his or her decision. Save in the most exceptional circumstances, the trial judge should not call a person to give evidence — this principle is qualified for Nauru by s 100 of the CPA, which authorises the court to call a witness and requires it to do so when it appears to the court "essential to the just decision of the case". A decision of the prosecutor not to call a particular person as a witness will only constitute a ground for setting aside a conviction if, when viewed against the conduct of the trial taken as a whole, it is seen to give rise to a miscarriage of justice. As Dawson J had earlier explained in Whitehorn v The Queen, a prosecutor is bound or under a duty to call all available material witnesses in the sense that a failure to exercise the discretion, resulting in the denial of a fair trial 40 (1984) 154 CLR 563; [1984] HCA 38. 41 (1984) 154 CLR 563 at 575 per Gibbs CJ, Mason, Murphy, Wilson and Dawson JJ. Bell to the accused, may result in the setting aside of the conviction. His Honour said42: "It is in this context that it is possible to speak of a Crown Prosecutor being bound, or under a duty, to call all available material witnesses. It is not a duty owed by the prosecutor to the accused which is imposed by some rule of law; rather it forms part of a description of the functions of a Crown Prosecutor." The use of terms such as "bound" and "duty" and "required" does not detract from the discretionary character of the prosecutor's function in relation to the calling of witnesses. That discretionary character was affirmed in R v Soma43: "what is now clear is that it is for the prosecution to decide what witnesses will be called and 'determine the course which will ensure a proper presentation of the Crown case conformably with the dictates of fairness to the accused'. That power is not unconfined. In particular, if an accused objects to the course which the prosecution takes in presenting its case, the objection must be resolved by applying principles which include the general rule that the prosecution must offer all its proof before the accused is called on to make his or her defence." (footnote omitted) There was no dispute at trial or on this appeal that Constable Harris was a material witness. Nor was there any dispute that he was unable to be called on the second day of the trial because he was "considerably under the influence of alcohol". Only one further witness was called following that advice to the Court by the prosecutor. That was Dr Castanedo. The prosecutor then closed his case without calling Constable Harris. He did not request an adjournment for the purpose of calling him. Nor, at that time, did the appellants' representative. Had he done so, there is no reason to believe that the trial judge would not have granted it. It would have been an entirely appropriate exercise of his Honour's discretion. The absence of any such application may have reflected a forensic assessment. It may have reflected a judgment by the prosecutor that Constable Harris' reliability was questionable. It may have reflected an inadequate appreciation, by either or both of the representatives, of the relevant legal principles. These are matters of speculation. The key question is whether the 42 (1983) 152 CLR 657 at 674. 43 (2003) 212 CLR 299 at 309 [29] per Gleeson CJ, Gummow, Kirby and Hayne JJ. See also Stanoevski v The Queen (2001) 202 CLR 115 at 127 [47] per Gaudron, Kirby and Callinan JJ; [2001] HCA 4. Bell failure to call Constable Harris resulted in unfairness to the appellants constituting or giving rise to a miscarriage of justice. The respondent submitted that the central issue in the case was whether the conduct alleged by the complainant happened at all. The only direct evidence that it happened was from the complainant. The first appellant had denied the incident. The trial judge accepted the complainant's evidence, which was corroborated by evidence of her distress given by Senior Constable Deireragea and the finding that the appellants lied when asked by police about her presence at their home. The appellants submitted that, when viewed in the circumstances of the case as a whole, the failure by the prosecution to call Constable Harris gave rise to a miscarriage of justice. The trial judge, having considered Constable Harris' statement, formed the view that the failure to call him harmed the prosecution case. He accepted Senior Constable Deireragea's evidence as "measured and credible" despite the absence of Constable Harris44. The respondent pointed to aspects of the Harris statement which would have strengthened the prosecution case: that the first appellant was dressed in only a towel and no shorts at the time of police attendance; that during the time the first appellant was at the door, the second appellant approached and Senior Constable Deireragea asked if there was a lady at their dwelling, namely the complainant, and the second appellant stated that the complainant was staying with them and had gone out; that while Senior Constable Deireragea was having a conversation with the appellants, Constable Harris saw a lady come out of the living area and Senior Constable Deireragea then asked who that lady was and the second appellant stated that it was the complainant; that the complainant was distressed at the time of police attendance; that she complained of sexual assault in the presence of Constable Harris; that the second appellant upon her arrest stated to Senior Constable Deireragea, "Sex its only sex", which was arguably an admission to an element of the offence; 44 [2011] NRSC 24 at [80]. Bell observations made by Constable Harris as to the state of the scene upon examination; and evidence capable of confirming the continuity of various exhibits. The submissions made by the respondent should be accepted. The failure to call Constable Harris did not give rise to a miscarriage of justice, having regard to the matters canvassed in the trial judge's judgment and the circumstances set out in the respondent's submissions. The appellants also contended that the failure to call Harris and other police officers involved in the first post-arrest examination of the appellants' house, apparently carried out without a search warrant, deprived them of the ability to challenge evidence relating to the location of physical items said to have been found at the house. These items appeared in photographs which were taken by Constable Botelanga. The appellants submitted that in this respect the failure to call Constable Harris was significant because he had entered the house during the initial conversation with the appellants at the door and had seen the state of the house at that time. According to the police photographs taken by Constable Botelanga during the second search of the premises, there was a mattress on the lounge room floor, a laptop on a chair facing the mattress, two pairs of panties, one on the dining table and one on the floor, and a towel draped over a chair next to the mattress. The appellants submitted that the possibility could not be excluded that some of these items had been planted. Had the other police officers involved in the first response group, ie Constables Harris and Namaduk, been called, their evidence would have been relevant to Senior Constable Deireragea's evidence and that of the complainant and the first appellant. The respondent did not dispute that evidence from Constable Harris and Constable Namaduk may have been relevant in determining whether Senior Constable Deireragea found a knife on the kitchen bench at the direction of the complainant, which was circumstantial evidence in support of the complainant's allegations. However, the suggestion that the response team could have supported a contention that police had re-organised the scene of the alleged offences is speculative at best. The trial judge had regard to their absence and, in doing so, was entitled to accept, as he did, that the kitchen knife was used as described by the complainant. There was no miscarriage of justice arising in that connection from the failure to call Constables Harris and Namaduk. Bell Whether the trial judge should have called Constable Harris as a witness The question whether, absent consent or statutory authority, a trial judge in criminal proceedings can call a witness of his or her own motion has been considered on a number of occasions in this Court, the earliest of which was in Titheradge v The King45, said by the majority in Shaw v The Queen46 to have denied the existence of such a power47, a view adopted by Dawson J in Whitehorn48. However, in Apostilides49, in a unanimous joint judgment to which Dawson J was party, the Court noted that Gibbs CJ and Brennan J had reserved their opinion on the question in Whitehorn and that Murphy and Deane JJ did not feel it necessary to discuss it. Having considered the authorities, the Court then set out the six general propositions, already quoted, including proposition five that50: "Save in the most exceptional circumstances the trial judge should not himself call a person to give evidence." In the present case, there is statutory authority for the trial judge to take such a course. That authority is to be found in s 100(1) of the CPA, which provides in the relevant part: "Any Court may at any stage of any proceeding under this Act, of its own motion or on the application of any party, summon any person as a witness, or examine any person in attendance though not summoned as a witness, or recall and re-examine any person already examined, and the Court shall, unless the circumstances make it impossible to do so, summon and examine or recall and re-examine any such person if his evidence, or further evidence, appears to it essential to the just decision of the case". 45 (1917) 24 CLR 107; [1917] HCA 76. 46 (1952) 85 CLR 365; [1952] HCA 18. 47 (1952) 85 CLR 365 at 379 per Dixon, McTiernan, Webb and Kitto JJ. 48 (1983) 152 CLR 657 at 675–684. 49 (1984) 154 CLR 563. 50 (1984) 154 CLR 563 at 575. Bell There follows a proviso dealing with the rights of counsel to cross-examine any such person and making provision for adjournments to enable such cross-examination to be prepared. The CPA was evidently taken from a standard model for a procedural statute which had been developed for former British dependencies, the Fiji Islands, Kiribati, Solomon Islands and Tuvalu, and also for the former Anglo-French condominium of Vanuatu51. Provisions in terms very similar to those of s 100 have for many years appeared in criminal procedure statutes in India, Singapore and Malaysia. One such provision is s 540 of the Indian Code of Criminal Procedure (Act No V of 1898), which was repealed and re-enacted as s 311 of the Indian Criminal Procedure Code 1973. The Supreme Court of India has treated the section as providing, in its first part, a broad discretion to summon witnesses which must be carefully exercised and, in the second part, a mandatory test not involving the exercise of discretion52. A similar provision is also found in s 283 of the Criminal Procedure Code (Act No 15 of 2010) of Singapore. The verbal formula is almost identical. It has predecessors in the Criminal Procedure Code (Cap 21, 1936) of the Straits Settlements, the Criminal Procedure Code (Cap 132, 1955) of the Colony of Singapore, and s 399 of the Criminal Procedure Code (Cap 68, 1985 Rev Ed), which was repealed and re-enacted as the current provision. In the Supreme Court of Singapore in Azman Bin Jamaludin v Public Prosecutor53, the Chief Justice of Singapore, after referring to some of the Indian decisions, said of "The local decisions on s 399 of the CPC (as well as the Indian decisions ...) show that the first limb confers a discretionary power on the trial judge, whilst the second limb mandates his exercise of the power to summon or recall a witness if it is essential to the justice of the case." 51 Colvin, "Criminal Procedure in the South Pacific", (2004) Bond University Law Papers at 5–6, available at <epublications.bond.edu.au/law_pubs/19>. 52 UT of Dadra & Haveli v Fatehsinh Mohansinh Chauhan [2006] INSC 491 at [8]; see also Ram Jeet v The State AIR 1958 All 439 at 440 [4], a decision of the Allahabad High Court, cited with approval by the Supreme Court of India in the above-mentioned case; Jamatraj v State of Maharashtra AIR 1968 SC 178 at 181 53 [2011] SGHC 250. 54 [2011] SGHC 250 at [13]. Bell The Chief Justice expressly noted that the section represents a departure from the position under English law. In Malaysia, an almost identical provision is found in s 425 of the Criminal Procedure Code (Act 593), which has its ancestry in s 425 of the Criminal Procedure Code (FMS Cap 6) of the Federation of Malaya. That provision was considered by the Supreme Court of Malaysia in Ramli bin Kechik v Public Prosecutor55. The Court referred to the decision of the Indian Supreme Court in Jamatraj v State of Maharashtra56 and held57: "If there is the apprehension of justice failing by an erroneous acquittal or by an erroneous conviction the court would be justified in exercising its discretion in calling for additional evidence under this section. Where the court is of the opinion that the evidence of certain witnesses is essential to the just decision of the case, it is bound to summon them". legal representation, It is not necessary for present purposes to undertake any exhaustive exposition of the scope and operation of s 100. The provision appears to have a long history. Its departure from the very restrictive approach of the common law may have reflected a perception of conditions, including the limited availability of competent those colonial and post-colonial jurisdictions for which it appears originally to have been designed. There is no reason to suppose, however, that the discretionary element of s 100(1) should not be informed by a principle of restraint, having regard to the risks which necessarily attach to a trial judge calling a witness. As to the obligation imposed by the section, it is not enlivened unless the calling of the witness appears to the court to be essential to the just decision of the case. For the reasons already given, the failure by the prosecutor to call Constable Harris was not shown to have given rise to a miscarriage of justice. That being so, it could not be said that his evidence was essential to the just decision of the case. The trial judge's reference to the witness statement The trial judge's reference to Constable Harris' statement was done on notice to the parties in the course of closing submissions. Both parties had had notice of the content of the statement from a time prior to the commencement of 55 [1986] 2 MLJ 33. 56 AIR 1968 SC 178. 57 [1986] 2 MLJ 33 at 34. Bell the trial. The statement was not put in evidence, nor used in evidence. There was no breach of natural justice in the trial judge's reference to it. Whether the verdict was unreasonable This ground was based on a narrow factual argument about the presence of a mattress in the lounge room of the appellants' house. The appellants submitted that if the mattress was not in the lounge room at the time when the front door of the house was opened to police, the offences could not have been committed as alleged. The first appellant had denied that there was a mattress in the lounge room. The appellants submitted that it was open to infer the mattress was not there having regard to Senior Constable Deireragea's failure to say it was and from her testimony about knocking for ten minutes. No weight, it was said, could be placed on any other of the evidence relating to the mattress. It was said that Senior Constable Deireragea's testimony about the warrantless search did not establish that she was present for the entire time. Constable Botelanga's testimony and the photographic evidence spoke to a later point in time. Further, it was open to infer that the evidence of Constable Harris and Constable Namaduk and the photographs said to have been taken during the warrantless search would not have assisted the prosecution because of the unexplained failure to adduce that evidence. These are argumentative considerations which do not overcome the trial judge's acceptance of the corroborated evidence of the complainant that the first appellant had raped her with the assistance of the second appellant. They do not establish a basis for saying that it was not open to the trial judge to conclude as he did, beyond reasonable doubt, that the offences had been committed. Conclusion For the preceding reasons, this appeal should be dismissed.
HIGH COURT OF AUSTRALIA Matter No S1/2010 LEHMAN BROTHERS HOLDINGS INC APPELLANT AND CITY OF SWAN & ORS Matter No S362/2009 RESPONDENTS LEHMAN BROTHERS ASIA HOLDINGS LIMITED (IN LIQUIDATION) APPELLANT AND CITY OF SWAN & ORS RESPONDENTS Lehman Brothers Holdings Inc v City of Swan Lehman Brothers Asia Holdings Limited (in liquidation) v City of Swan [2010] HCA 11 Date of Order: 30 March 2010 Date of Publication of Reasons: 14 April 2010 S1/2010 & S362/2009 Matter No S1/2010 ORDER Appeal dismissed. The appellant pay the costs of the first, second and third respondents. Matter No S362/2009 Appeal dismissed. The appellant pay the costs of the first, second and third respondents. On appeal from the Federal Court of Australia Representation T F Bathurst QC with A J Payne SC and E A J Hyde for the appellant in S1/2010 and the seventh respondent in S362/2009 (instructed by Jones Day) D L Williams SC with M J Steele for the seventh respondent in S1/2010 and the appellant in S362/2009 (instructed by DibbsBarker Lawyers) N C Hutley SC with A P Coleman and D R Sulan for the first to third respondents in both matters (instructed by Piper Alderman) B A J Coles QC with P Kulevski for the fourth to sixth respondents in both matters (instructed by Clayton Utz Lawyers) S J Gageler SC, Solicitor-General of the Commonwealth with J W S Peters SC and O Bigos appearing as amicus curiae on behalf of Australian Securities and Investments Commission (instructed by Australian Securities and Investments Commission) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Lehman Brothers Holdings Inc v City of Swan Lehman Brothers Asia Holdings Limited (in liquidation) v City of Swan Corporations – Statutes – Deed of company arrangement ("DOCA") – Corporations Act 2001 (Cth), s 444D(1), provided that a "deed of company arrangement binds all creditors of the company, so far as concerns claims arising on or before the day specified in the deed" – Where provisions of DOCA purported to provide for moratorium on and release of claims that might be made by company's creditors against persons other than the company – Whether such provisions of DOCA binding on company's creditors – Whether DOCA void. Words and phrases – "so far as concerns claims", "deed of company arrangement". Corporations Act 2001 (Cth), Pts 5.1, 5.3A, s 600A. FRENCH CJ, GUMMOW, HAYNE AND KIEFEL JJ. On 30 March 2010, the Court made orders in each of these matters that the appeal be dismissed. In each appeal the appellant was ordered to pay the costs of the first, second and third respondents. What follows are our reasons for joining in those orders. Part 5.3A of Ch 5 of the Corporations Act 2001 (Cth) ("the Act") provides for what the heading of the Part describes as "Administration of a company's affairs with a view to executing a deed of company arrangement". These two appeals concern the application of Pt 5.3A to Lehman Brothers Australia Ltd ("Lehman Australia"). Two other Lehman Brothers companies are parties to the proceedings in this Court: Lehman Brothers Holdings Inc ("Lehman Holdings") and Lehman Brothers Asia Holdings Ltd ("Lehman Asia"). Lehman Holdings is the ultimate parent company of both Lehman Australia and Lehman Asia. Lehman Holdings is the appellant in one appeal; Lehman Asia is the appellant in the other. Lehman Australia is the fourth respondent in each appeal. In September 2008, Lehman Australia appointed administrators under Pt 5.3A of the Act. In June 2009, the administrators and Lehman Australia executed a Deed of Company Arrangement. The central issue in each appeal is whether creditors of Lehman Australia are bound by the Deed. That question should be answered "no". To explain why the relevant issue should be expressed in the terms indicated, and answered "no", it is convenient to proceed by the following steps. First, something should be said about the facts that underlie these matters and to describe the development of the Deed. Next, it will be convenient to sketch the history of proceedings in the courts below. Then, reference must be made to a number of provisions of the Act, particularly those provisions of Pt 5.3A which will show the structure and operation of the Part. Finally, the relevant question of statutory construction should be identified and answered. Some underlying facts Lehman Australia procured companies which it controlled, and were specially incorporated for the purpose, to borrow money from investors. The investment arrangements were known as CDO (or collateralised debt obligation) instruments. The borrower issued a note to the investor. The borrowings were used by the special purpose company to acquire cash, bonds or other low risk financial instruments. It was intended that each special purpose borrower would make (and each did make) other transactions with other parties using the property acquired. The detail of those other transactions (and, in particular, the granting of rights over that property) need not be examined. It is enough to observe of those other transactions that the special purpose company that had issued its note to the investor would acquire an interest in other CDO notes and would enter credit default swap agreements with a counterparty. The credit default swap agreements were intended to be the ultimate source of interest and principal payments to investors. Argument of the appeals in this Court proceeded on the footing that the times for repayment of the notes issued by the special purpose companies have not arrived. So far as the material in this Court shows, there has been no default in payment of interest. Yet because of the sudden and steep decline in the realisable value of certain assets, which was a defining element of the global financial crisis that began in 2007, investors consider that they may not recover the face value of their debts. Some investors have made claims against Lehman Australia and other Lehman companies alleging, among other things, negligence, or misleading or deceptive conduct in connection with the investor's decision to invest. Other investors have foreshadowed similar claims. In September 2008, Lehman Holdings, the ultimate holding company of both Lehman Australia and Lehman Asia, sought bankruptcy protection in the United States. Lehman Asia went into provisional liquidation. The directors of Lehman Australia resolved to enter administration under Pt 5.3A of the Act. Some months later, the administrators recommended that creditors resolve that Lehman Australia make a Deed of Company Arrangement rather than resolve that the company go into liquidation or that the administration end. The development of the Deed of Company Arrangement Ultimately, a form of arrangement proposed by Lehman Asia (itself a creditor of Lehman Australia) was adopted. Another proposal, made by another creditor of Lehman Australia (Gowing Brothers Limited), had advanced a different arrangement, but that proposal was withdrawn. It is sufficient for present purposes to describe some of the main features of the proposal advanced by Lehman Asia. All of the property and assets of Lehman Australia were to comprise a "Deed Fund". From the Deed Fund there would be created a separate pool of funds for distribution among "Litigation Creditors" – those creditors, other than employees and general creditors, who had claims against Lehman Australia which arose before the commencement of the administration on 26 September 20081. The Litigation Creditors are all investors of the kind earlier mentioned. The separate pool of assets for distribution among Litigation Creditors was to comprise a specified sum of money (proposed at first to be $36m but eventually agreed to be $43.2m), together with the proceeds of any insurance policy (including any claim against, or settlement with, the professional indemnity insurer of Lehman Australia). Priority creditors and general creditors would likely be paid in full. The proposal for a deed along these lines was advanced by Lehman Asia on the footing that its making would bring litigation to an end, avoiding the attendant expense, delay and uncertainty, and provide an equitable return to creditors of all classes. An important element of the proposal was to identify what releases or indemnities would be given in return for rights against the separate pool of assets which came to be called the "Litigation Creditors' Fund". The nature and extent of what releases and indemnities were proposed changed between Lehman Asia's first proposal and the proposal ultimately put to creditors. The detail of those changes, and the negotiations that brought them about, need not be noticed beyond observing that doubt was expressed by the administrators about the enforceability of certain of the releases and indemnities first proposed. A final form of proposed deed was put to a meeting of creditors on 28 May 2009. A majority in number (61 to 57) and in value ($256.7m to $70.2m) of creditors who attended the meeting voted in favour of the resolution. Although some attention was given in argument to the composition of the majority, and in particular to what was said to be the role of Lehman companies in procuring the Deed, that is not a matter that bears upon the issues that are to be decided in these appeals. At the risk of undue abbreviation, the Deed provided that the investors who asserted a claim against Lehman Australia (the Litigation Creditors) retained their rights against the relevant special purpose companies that had borrowed money, compromised their claims against Lehman Australia, and ultimately 1 The Deed defined "Litigation Creditors", in effect, as current or former clients of Lehman Australia who at 26 September 2008 had a claim against Lehman Australia arising from their purchase of collateralised debt obligations and other financial products from Lehman Australia, or pursuant to Lehman Australia's services or advice. released other Lehman Entities2 from claims arising from their investment that investors may have against those other entities. Argument in this Court, and in the Court below, directed particular attention to three provisions of the Deed: cll 7.1, 9 and 11.5. The proper construction of those provisions is not now disputed. First, cl 7.1 gave the Deed Administrators sole conduct and control of any insurance claim which otherwise could have been conducted by a creditor of Lehman Australia in respect of insurance of Lehman Australia or a Lehman Entity other than Lehman Asia. Second, cl 9 operated to provide a moratorium in respect of a claim (or an insurance claim) by a Litigation Creditor against Lehman Entities. Third, cl 11.5 provided that, upon payment to Litigation Creditors of the final dividend from the Litigation Creditors' Fund, Litigation Creditors release all claims against Lehman Entities (other than the special purpose borrowing companies) and all insurance claims. As will later be explained, to the extent that the provisions of cl 9 provided for a moratorium in favour of Lehman Entities, and the provisions of cl 11.5 provided for release of claims against Lehman Entities, those provisions did not bind creditors. Proceedings in the courts below After the passing of the resolution requiring execution of the Deed, but before its execution, two local authorities who had voted against the resolution (City of Swan and Parkes Shire Council) instituted proceedings in the Federal Court of Australia challenging the validity of the Deed and the validity of the resolution to enter into the Deed, and claiming an order that the Deed be terminated pursuant to s 445D of the Act. A third local authority, Wingecarribee Shire Council, was later joined as the third plaintiff. Lehman Australia, the (who had been named as Deed administrators of Lehman Australia Administrators in the Deed) and Lehman Asia (then in liquidation) were named as defendants to the proceeding. Lehman Holdings was later joined as a defendant. It will be convenient to continue to refer to the three local authorities as "the plaintiffs". They are the first to third respondents in each of the appeals to this Court. The plaintiffs alleged that the inclusion in the Deed of any or all of the three clauses mentioned earlier (cll 7.1, 9 and 11.5) entailed that the Deed was 2 The Deed defined "Lehman Entity" as Lehman Holdings and any body corporate, not incorporated in Australia, that was partly or wholly owned, directly or indirectly, by Lehman Holdings at, or in the six months before, 15 September 2008. not a "valid" deed under Pt 5.3A. The plaintiffs proposed that there be argued separate questions directed to the proper construction of each of the impugned provisions, and to whether Pt 5.3A authorised their inclusion in a Deed of Company Arrangement. The defendants opposed adoption of that course but Rares J ordered3 that eight questions be determined separately from, and before the trial of, the proceedings and that those questions be reserved for consideration by a Full Court of the Federal Court. Three questions (numbered 1, 3 and 5) were directed to issues of construction of each of the impugned provisions. The answers to those questions yielded the now undisputed construction of the provisions that is mentioned earlier in these reasons. Three questions (numbered 2, 4 and 6) asked, in effect, whether, on the construction of the relevant clause that was ultimately adopted, the relevant impugned provision was "valid and binding on the creditors of [Lehman Australia], having regard to sections 435A, 444A, 444D, 444H and Part 5.3A of the Act". The Full Court4 (Stone, Rares and Perram JJ) answered "no" to each of the questions about the validity of the three impugned provisions (questions 2, 4 and 6). To the further question "Is the [Deed] void and of no effect?" the Court answered "yes". These answers having been given by the Full Court, Rares J subsequently made a declaration that the Deed is void, and ordered that Lehman Australia be wound up by the Court. By special leave, both Lehman Holdings and Lehman Asia appeal against so much of the orders of the Full Court as answered the questions about the validity of the impugned provisions of the Deed and the validity of the Deed as a whole. Despite the order for winding up, the controversy about validity of each of the impugned provisions (and the Deed) remains a live controversy between the parties. Relevant provisions of the Act Object and structure of Pt 5.3A The object of Pt 5.3A of the Act is stated in s 435A as being: 3 City of Swan v Lehman Brothers Australia Ltd (2009) 73 ACSR 86; [2009] FCA 4 City of Swan v Lehman Brothers Australia Ltd (2009) 179 FCR 243. "to provide for the business, property and affairs of an insolvent company to be administered in a way that: (a) maximises the chances of the company, or as much as possible of its business, continuing in existence; or if it is not possible for the company or its business to continue in existence – results in a better return for the company's creditors and members than would result from an immediate winding up of the company." The general scheme of the Part is indicated by the headings of some of its divisions: Div 1 Div 2 ss 435A–435C: ss 436A–436G: Div 3 ss 437A–437F: Div 4 Div 5 Div 6 ss 438A–438E: ss 439A–439C: ss 440A–440JA: Div 7 ss 441A–441K: Div 8 Div 9 ss 442A–442F: ss 443A–443F: Div 10 ss 444A–444J: Div 11 Div 12 Div 13 ss 445A–445H: ss 446A–446C: ss 447A–447F: company's property "Preliminary" "Appointment of administrator and first meeting of creditors" "Administrator assumes control of company's affairs" "Administrator investigates company's affairs" "Meeting of creditors decides company's future" "Protection of administration" "Rights of chargee, lienee, pledgee, owner or lessor" "Powers of administrator" "Administrator's liability and indemnity for debts of administration" "Execution and effect of deed of company arrangement" "Variation, termination and avoidance of deed" "Transition to creditors' voluntary winding up" "Powers of Court" during The Part is drafted in a way that emphasises the need for prompt action in implementing its provisions, and prompt decisions by creditors about the fate of a company to which administrators are appointed. As the statement of the object of Pt 5.3A in s 435A makes plain, the central concern of the Part is regulation of the administration of an insolvent company. A company may appoint5 an s 436A. administrator under the Part if the board resolves that the company is, or is likely to become, insolvent. Section 435C(2) identifies the "normal outcome" of an administration as one of three: execution of a deed of company arrangement, a resolution by the company's creditors that the administration should end, or a resolution by the company's creditors that the company be wound up. Administrator's powers and responsibilities Once appointed, an administrator assumes control of the company's affairs6 and acts as the company's agent7. The powers of other officers of the company are suspended8. Without the administrator's consent, or the leave of the Court9, charges10 and liens and pledges11 cannot be enforced, distress for rent12 cannot be carried out, and owners or lessors of property13 used or occupied by, or in the possession of, the company cannot take possession of the property. No enforcement process14 can be begun or proceeded with except with the leave of the Court. s 437A. s 437B. s 437C. 9 Section 58AA defines "Court" as any of the Federal Court of Australia, the Supreme Court of a State or Territory, the Family Court of Australia, or a court to which s 41 of the Family Law Act 1975 (Cth) applies because of a proclamation made under s 41(2) of that Act. 10 s 440B. 11 s 440BA. 12 s 440BB. 13 s 440C. 14 s 440F. The administrator must "[a]s soon as practicable after the administration of a company begins" investigate15 the company's affairs and form an opinion about which of the three "normal outcomes" of an administration would be in the interests of the company's creditors. Within a very short period16 after the administration begins (20 or 25 business days, unless extended), the administrator must convene17 a meeting of creditors to be held within five business days before, or five business days after, the end of the convening period18. The administrator must give19 creditors a statement setting out the administrator's opinion about whether it would be in the creditors' interests for the company to execute a deed of company arrangement, for the administration to end, or for the company to be wound up. The statement must set out20 the administrator's reasons for those opinions, together with such other information known to the administrator as will enable the creditors to make an informed decision about those matters. Creditors' meetings A meeting of creditors convened under s 439A may be adjourned from time to time, but the period of the adjournment (or the total of the periods of adjournment) must not21 exceed 45 business days. The speed with which it is expected that an administrator and the creditors will act may suggest that Pt 5.3A was expected to find common application to small and medium enterprises. It would not be right, however, to draw from that observation a conclusion that the Part can have no application to larger or more complex enterprises. Nor does the promptness with which administrators and 15 s 438A. 16 s 439A(5). 17 s 439A(1). 18 s 439A(2). 19 s 439A(4)(b). 20 s 439A(4)(b). 21 s 439B(2). creditors must act under Pt 5.3A bear upon the issues of construction that arise in this case. Division 10 of Pt 5.3A provides for the execution, and effect, of a deed of company arrangement. The provisions of the division are engaged22 where, at a meeting of creditors convened under s 439A, the company's creditors resolve that the company execute a deed of company arrangement. The Act itself says nothing about the way in which a creditors' meeting is conducted except by providing that the administrator is to preside23. Instead, these questions are dealt with by subordinate legislation: the Corporations Regulations 2001 (Cth) ("the Regulations"). In particular, subject to some presently immaterial exceptions, regs 5.6.12 to 5.6.36A apply24 to the convening and conduct of (among other things) any meeting of creditors convened under Pt 5.3A of the Act. Those procedures depend upon creditors having submitted a proof of debt or claim25. Resolutions put to the vote are to be decided26 on the voices, unless a poll is demanded before or on the declaration of the result of the voices. Resolutions put to a poll are carried27 if a majority of creditors voting (whether in person, by attorney, or by proxy) vote in favour, and if the value of the debts owed by the company to those creditors is more than half the total debts owed to all the creditors voting. The person presiding at the meeting may cast28 a casting vote. Neither the Act nor the Regulations require division of creditors into classes. Instead, protection for the position of individual creditors, or groups of creditors, is provided by ss 445D and 600A of the Act. Section 445D gives the Court power to terminate a deed in various circumstances, including, in 22 s 444A(1). 23 s 439B(1). 24 reg 5.6.11(2). 25 regs 5.6.11(1) and 5.6.23(1). 26 reg 5.6.19(1). 27 reg 5.6.21. 28 reg 5.6.21(4). particular29, where the deed is oppressive or unfairly prejudicial to, or unfairly discriminatory against, one or more creditors of the company, or is contrary to the interests of creditors as a whole. Section 600A gives the Court power to set aside a resolution passed at a creditors' meeting if the resolution would not have passed but for votes cast by creditors which are related entities of the subject company, and if the passing of the resolution is contrary to the interests of the creditors as a whole, or is likely to unreasonably prejudice the interests of the defeated creditors. The point to be made about the provisions of the Act and the Regulations regarding creditors' meetings is that they provide that effect is to be given to the will of the requisite majority of creditors who vote at the relevant meeting. The provisions may be understood as proceeding from two related premises. First, judgment about what is to happen to the subject company, and, in particular, the judgment about the commercial worth of any proposal for a deed of company arrangement, is committed to the body of all creditors. Secondly, for the making of that decision, it is neither necessary nor appropriate to divide creditors into separate classes. The only substantial qualifications to the generality of these propositions are provided by the conferral on the Court of powers under ss 445D and 600A. In proceeding from premises of the kinds identified, the Act and the Regulations give effect to principles not different in any material way from those that have long underpinned statutory compositions and arrangements in individual bankruptcy30. (Some of the history of those provisions is set out by Isaacs J in Isles v Daily Mail Newspaper Ltd31.) The chief difference between Pt 5.3A and earlier provisions for statutory composition and arrangements in corporate insolvency32 is the role played by the Court. Earlier provisions required court approval before the scheme was effective; Pt 5.3A provides for disallowance by the Court after the deed has been made. 29 s 445D(1)(f). 30 See, for example, Bankruptcy Act 1898 (NSW), s 19; Insolvency Statute 1865 (Vic), ss 40-42; Bankruptcy Act 1892 (WA), s 17; Bankruptcy Act 1870 (Tas), s 27. 31 (1912) 14 CLR 193 at 203; [1912] HCA 18. 32 See, for example, Joint Stock Companies Arrangement Act 1870 (UK), s 2. Examples of similar provisions made in colonial legislation include Companies Act 1899 (NSW), s 160; Companies Act Amendment Act 1889 (Q), s 35; Companies Act 1893 (WA), s 174. Of course, it is important to approach Pt 5.3A of the Act recognising that the adoption of a deed of company arrangement by majority affects the rights of dissentients. It is also important to recognise that the rights of dissentients against the company in question (and the rights of all others bound by the deed) are modified, even replaced, by the rights they have under the deed. But these are effects common to all forms of statutory arrangement and compromise. And such statutory arrangements have been a common feature of both personal and corporate insolvency legislation for a very long time. Deeds of company arrangement There are four provisions of the Act that deal expressly with what provisions are to be included in a deed of company arrangement. First, s 444A(4) of the Act provides that a deed of company arrangement must specify a number of matters. Only two of those matters need be mentioned. The deed must specify "the nature and duration of any moratorium period for which the deed provides"33 and "to what extent the company is to be released from its debts"34. Secondly, s 444A(5) provides that the deed is taken to include certain prescribed provisions "except so far as [the deed] provides otherwise". The prescribed provisions are set out in Sched 8A to the Regulations. Two of those prescribed provisions may be noted – cl 5 dealing with discharge of debts, and cl 6 dealing with extinguishment of claims. They provide: Discharge of debts The creditors must accept their entitlements under this deed in full satisfaction and complete discharge of all debts or claims which they have or claim to have against the company as at the day when the administration began and each of them will, if called upon to do so, execute and deliver to the company such forms of release of any such claim as the administrator requires. Claims extinguished If the administrator has paid to the creditors their full entitlements under this deed, all debts or claims, present or future, actual or contingent, due or which may become due by the company as a 33 s 444A(4)(c). 34 s 444A(4)(d). result of anything done or omitted by or on behalf of the company before the day when the administration began and each claim against the company as a result of anything done or omitted by or on behalf of the company before the day when the administration began is extinguished." Like the other prescribed provisions, the operation of cl 5 and cl 6 may be excluded by the deed providing otherwise. It is to be noted, however, that cl 5 and cl 6 deal respectively with debts or claims which creditors "have or claim to have against the company", and debts or claims "due or which may become due by the company as a result of anything done or omitted by or on behalf of the company" before an identified date (emphasis added). Thirdly, s 444DA of the Act (inserted in the Act in 200735) provides that, subject to some limited exceptions, a deed of company arrangement must contain a provision to the effect that, for the purposes of the application by the administrator of the property of the company coming under the administrator's control under the deed, eligible employee creditors are entitled to a priority at least equal to what they would have been entitled if the property were applied in accordance with ss 556, 560 and 561 (provisions that deal with proof and ranking of claims in a winding up). Fourthly, s 444DB, also inserted in the Act in 2007 along with s 444DA, requires that a deed must provide that certain superannuation contribution debts are not admissible to proof. Apart from the provisions that have been mentioned (s 444A(4) and (5), and ss 444DA and 444DB), the Act does not identify what provisions may or may not be contained in a deed of company arrangement. More particularly, apart from the references already noted to a moratorium period and the release of debts, the Act and the Regulations are silent about both the nature and the content of the "arrangement" between the company and its creditors that may be made by, and expressed in, a deed of company arrangement. The question of construction: what claims may be compromised? The provisions of the Act examined thus far in these reasons provide no compelling reason to confine the terms upon which creditors might agree to the compromise of claims against the company by the making of a deed of 35 Corporations Amendment (Insolvency) Act 2007 (Cth), s 3, Sched 1, item 4. arrangement under Pt 5.3A. The subject matter, scope and purpose of the provisions that have been mentioned readily yield the inference that the subject matter of the compromise or arrangement must be debts or claims against the company. And the debts or claims the subject of the compromise or arrangement can, and ordinarily will, extend to any debt or claim that would be provable in a winding up. That is, in the words of the provision identifying provable debts and claims36, the debts or claims the subject of the compromise or arrangement, whether by way of moratorium or release, will be "all debts payable by, and all claims against, the company (present or future, certain or contingent, ascertained or sounding only in damages), being debts or claims the circumstances giving rise to which occurred before the relevant date". But the question at issue in these appeals directs attention not just to what debts or claims are compromised, but to the terms and conditions on which they may be compromised. May they be compromised on terms that claims against a person other than the subject company are released? The Act is silent about what price can be exacted from creditors, with the agreement of a majority (by number and value), for the compromise of their claims. The word "arrangement", when used in the collocation "deed of company arrangement", could readily be understood as encompassing many kinds of compromise37. A priori, there is no reason, or at least no compelling reason, to confine the ambit of the terms and conditions upon which a creditor may lawfully agree to compromise a debt or claim against the company. Prima facie, it is for the majority of creditors to decide what terms are an acceptable price for compromising their claims. That is, whether compromising debts or claims on particular terms and conditions is commercially more desirable than the company going into liquidation is, according to the structure and content of Pt 5.3A, a question for creditors. It is for them to make their own commercial judgment. That being so, the evident scheme of the Act is that the will of the requisite statutory majority is imposed on all creditors. Neither considerations of the speed with which such an arrangement must be proposed, agreed in and concluded, nor the observation that dissenting creditors are bound by the decision of a majority in number and value, require any narrow or confined reading of those provisions that govern the making and content of a deed of company arrangement. 37 cf Re International Harvester Co of Australia Pty Ltd [1953] VLR 669; Re Buildmat (Australia) Pty Ltd and the Companies Act (1981) 5 ACLR 689; Re Glendale Land Development Ltd (In Liq) [1982] 2 NSWLR 563, more fully reported at (1982) 7 ACLR 171. In these circumstances, to ask whether particular provisions of a deed of company arrangement are "authorised" by Pt 5.3A, or are "valid", tends to divert attention from the critical question of statutory construction. That question is identified by recognising that the confinement of the reach of the provisions of Pt 5.3A which govern deeds of company arrangement is provided by the specification of who is bound by a deed, and the respect in which creditors are bound. Two provisions of Pt 5.3A identify the binding effect of a deed of company arrangement. Section 444G makes a deed binding on the company, its officers and members, and the deed's administrator. Section 444D deals with the position of creditors. It provides: "Effect of deed on creditors (1) A deed of company arrangement binds all creditors of the company, so far as concerns claims arising on or before the day specified in the deed under paragraph 444A(4)(i). Subsection (1) does not prevent a secured creditor from realising or otherwise dealing with the security, except so far as: the deed so provides in relation to a secured creditor who voted in favour of the resolution of creditors because of which the company executed the deed; or the Court orders under subsection 444F(2). Subsection (1) does not affect a right that an owner or lessor of property has in relation to that property, except so far as: the deed so provides in relation to an owner or lessor of property who voted in favour of the resolution of creditors because of which the company executed the deed; or the Court orders under subsection 444F(4). Section 231 does not prevent a creditor of the company from becoming a member of the company as a result of the deed requiring the creditor to accept an offer of shares in the company." The determinative question in these appeals is what is meant by the provision of s 444D(1) that a deed "binds all creditors of the company, so far as concerns claims arising on or before the day specified in the deed" (emphasis added). The Deed in this case To explain the competing constructions of s 444D(1) that were advanced in argument, it is necessary to say something further about the Deed that is at issue in these appeals. It will be recalled that three provisions of the Deed were impugned by those parties who were plaintiffs in the Federal Court. All three provisions related to claims that might be made by Litigation Creditors that arose out of investments made by those creditors in collateralised debt obligations and other financial products marketed by, or acquired or purchased pursuant to services or advice provided by, Lehman Australia on or before the date identified in the Deed. Clause 7 of the Deed related to "Insurance Claims" and "Insurance Proceeds". An "Insurance Claim" was identified in the Deed as "any claim for indemnity or other relief in relation to any insurance policy which insures or otherwise provides benefits to [Lehman Australia] or any Lehman Entity in connection with any [admissible claim against Lehman Australia under the Deed] or any claim, including any claim under statute, for the proceeds of, or a charge over the proceeds of, such insurance policy, but excluding any claim for indemnity under any insurance policy held by [Lehman Asia]". Clause 7 obliged the Deed Administrators to realise and get in all the proceeds of any Insurance Claim. As noted earlier, however, cl 7 gave the carriage of any Insurance Claim to the Deed Administrators, to the exclusion of Litigation Creditors. The Deed Administrators were given "an absolute discretion regarding the prosecution and resolution of any Insurance Claim". The proceeds of any Insurance Claims (referred to in the Deed as "Insurance Proceeds") were to be dealt with in accordance with cl 8 of the Deed, and thus were to form part of the Litigation Creditors' Fund. Clause 9 of the Deed provided for a moratorium in favour of Lehman Australia and the Lehman Entities until the Deed's termination. Clause 11 provided that, upon payment in full of amounts payable under the Deed, Litigation Creditors (and also general creditors) released all claims not only against Lehman Australia, but also against all Lehman Entities (other than the rights preserved in favour of Litigation Creditors against the special purpose companies that had issued notes). Thus, as noted earlier, the Deed provided first for a moratorium, and then for release, in respect of claims that Litigation Creditors had, not only against Lehman Australia, but also against Lehman Holdings (and other Lehman Entities), arising out of the creditors' investments in collateralised debt obligations and other financial products marketed by, or acquired or purchased pursuant to services or advice provided by, Lehman Australia. The competing constructions of s 444D(1) Lehman Holdings submitted that the words "so far as concerns claims" in s 444D(1) "require the existence of a connection or association between the claim in question and a claim against the insolvent company". Lehman Holdings submitted that, because claims against it and against other Lehman Entities arose out of the same transactions as were the subject of the Litigation Creditors' claims against Lehman Australia, the claims against Lehman Holdings (and other Lehman Entities) were "claims arising on or before the day specified in the Deed" within the meaning of that expression in s 444D(1). Lehman Asia submitted that a deed of company arrangement will "concern" a creditor's claim "if it provides for a regime of provisions which relate to that claim". At least this was so, the argument continued, in the case of an arrangement like that under the Deed which dealt with "the position of an insolvent company forming part of a group of companies with interlocking claims against them". Lehman Asia submitted that the impugned provisions were to be seen as part of the "give and take" of a compromise or arrangement of claims. By contrast, those parties which had been plaintiffs in the Court below submitted that the clause "so far as concerns claims arising on or before the day specified in the Deed" marked out the limit of the binding effect of a deed of company arrangement. That is, they submitted that creditors were bound by the Deed, but only to the extent identified by that clause. This submission should be accepted. Construction of s 444D(1) In the course of argument, the Court was taken to a great deal of extrinsic material which was said to bear upon the question of how s 444D(1) should be construed. It is neither necessary nor desirable to rehearse the detail of those arguments. Nothing that was said in the report of the Australian Law Reform Commission concerning its General Insolvency Inquiry38 (the "Harmer Report"), 38 Australian Law Reform Commission, General Insolvency Inquiry, Report No 45, the draft Bill that was incorporated in the Harmer Report, or the several exposure drafts and explanatory memoranda relating to the legislation which now comprises Pt 5.3A of the Act, assists in resolving the disputed questions of construction and application of s 444D(1). Those sources do not assist because in none of them was any direct consideration given to the point which must now be decided. In the Full Court of the Federal Court, some emphasis was given39 to ss 444E to 444H and s 444J as indicating that a deed of company arrangement can deal only with claims against the subject company. It may be accepted that nothing in those sections points away from that conclusion. But the critical observation to make is an observation about the text of s 444D(1). That sub-section identifies who is to be bound by a deed of company arrangement ("all creditors of the company") but at once proceeds (by the "so far as concerns" clause) to limit the extent to which those creditors are to be bound ("so far as concerns" identified claims). Contrary to the submissions of Lehman Holdings and Lehman Asia, there is no textual footing for reading the word "claims", in the "so far as concerns" clause in s 444D(1), as including claims against persons other than the subject company. Even if it were accepted that, as Lehman Asia submitted, it would be sensible to recognise that a creditor of one of a group of companies may have interlocking, even dependent, claims against one or more other companies in the group, Pt 5.3A directs attention only to the particular subject company; it does not deal with groups of companies. It may readily be accepted that any claims Litigation Creditors may have against Lehman Holdings or other Lehman Entities are claims that arise on or before the day specified in the Deed, and arise out of the same transactions as are the subject of those creditors' claims against Lehman Australia. It may also be readily accepted that if a claim is made against Lehman Holdings or another Lehman Entity, that company or those companies would very likely make a claim against Lehman Australia. And in that way, both Lehman Holdings and at least some other Lehman Entities are likely contingent creditors of Lehman Australia. And as contingent creditors of Lehman Australia, Lehman Holdings and the relevant Lehman Entities would be bound by the Deed. But none of these observations confronts the critical observation that s 444D(1) limits the extent to which a deed of company arrangement binds creditors. Creditors are bound "so far as concerns claims" against the subject 39 City of Swan v Lehman Brothers Australia Ltd (2009) 179 FCR 243 at 253 [39], company that arose before a specified date. And it is s 444D(1) alone which makes a deed of company arrangement binding on creditors. Because creditors are bound under s 444D(1) only to the limited extent identified in that provision, the assent of some creditors (even a majority by number and value of those who vote) to giving up claims against another does not bind other creditors to do so. No creditor is bound to give up such claims because the Act does not bind them beyond the limit prescribed by s 444D(1). More particularly, the Act does not bind creditors to give up a claim against a person other than the subject company – here, Lehman Australia. In this respect, Pt 5.3A (and, in particular, s 444D(1)) stands in sharp contrast with Pt 5.1 of Ch 5 of the Act, which regulates arrangements and reconstructions. The provisions of Pt 5.1 (which derive ultimately from the Joint Stock Companies Arrangement Act 1870 (UK)) make40 a compromise or arrangement binding on creditors (or on a class of creditors) if agreed to by a majority in number of the creditors (or class) whose debts or claims aggregate at least 75 per cent of the total amount of the debts and claims of the creditors (or class of creditors) present and voting, and if approved by order of the Court. Unlike s 444D(1), the provision of Pt 5.1 which makes certain compromises or arrangements binding on creditors (s 411(4)) does not qualify the extent to which creditors are bound. Beyond noting this contrast, it is neither necessary nor appropriate to go on to consider whether Pt 5.1 of the Act could have been engaged to achieve the result sought to be achieved by the Deed under consideration in these appeals. Nothing in these reasons should be understood as endorsing the criticisms made in this matter in the Full Federal Court of the earlier decision of the Full Federal Court in Fowler v Lindholm41. Effect must be given in the application of s 444D(1) to the words "so far as concerns claims arising on or before the day specified in the deed". Effect must be given to those words, recognising that the claims to which they refer are claims against the subject company. In the present case, the effect of those words is that creditors are not bound in respect of claims against Lehman Holdings or other Lehman Entities. That is, the provisions of cl 9 and cl 11.5 of the Deed which provided first for a moratorium, and then for a release, in respect of claims against Lehman Holdings or other Lehman Entities, did not bind creditors. 41 (2009) 178 FCR 563. One further point should be made. The reasoning which requires the conclusion reached about cl 9 and cl 11.5 of the Deed may not necessarily lead to the same conclusion with respect to cl 7 of the Deed – the clause about insurance claims. It must be observed that cl 7 obliged the Deed Administrators to pursue insurance claims and that the claims to be pursued were claims for indemnity or other relief insuring or providing benefits in connection with any claim Litigation Creditors had against Lehman Australia. What was said to be offensive about the clause was that the Deed Administrators were given sole conduct and control of those claims. It is then to be recalled that the proceeds of any insurance claim were to form a part of the fund for distribution among Litigation Creditors whereas, in a liquidation, s 562 of the Act would see those proceeds applied in discharge of the particular Litigation Creditor's claim against Lehman Australia that was met by the insurer. Read in this context, it may be open to argue that cl 7 of the Deed bound creditors in respect of their claims against Lehman Australia. It is, however, not necessary to decide this question. That is not necessary because it was not submitted that any part of the Deed could, or should, be given effect if the provisions of cl 9 and cl 11.5 were not binding on creditors. That being so, the conclusion earlier expressed, that those two provisions do not bind creditors, is sufficient to require the further conclusion that the Deed as a whole fails. HEYDON J. These reasons adopt the account of the factual circumstances, the procedural background, and the legislation to be found in the plurality judgment. They also adopt the abbreviations there employed. In relation to the sale to the plaintiffs by Lehman Australia of CDO instruments the plaintiffs wish to make claims against Lehman Australia, which is insolvent and in administration. A Deed of Company Arrangement "binds all creditors of the company" pursuant to s 444D(1) of the Act. Hence it permits a majority of the creditors of a company who vote for a Deed of Company Arrangement to destroy rights of other creditors by terminating their rights to sue the company. That conclusion was not challenged by the plaintiffs, and is plainly correct. Thus, if the Deed approved by the creditors on 28 May 2009 had been limited to claims against Lehman Australia, it would have validly extinguished the claims which the plaintiffs wished to make in relation to the CDO instruments against Lehman Australia. The plaintiffs also wish to pursue claims against various companies (including Lehman Holdings and Lehman Asia) other than Lehman Australia in relation to the sale to the plaintiffs by Lehman Australia of CDO instruments. Those latter claims include claims in negligence, claims for false, misleading or deceptive representations, contrary to s 12DA and s 12DB of the Australian Securities and Investments Commission Act 2001 (Cth), claims for breaches of fiduciary duty, and claims on a guarantee. Each of those claims – those rights to sue – is a chose in action. Even where the right to sue cannot be assigned, the fruits of the action may be. In that sense the claim is a right relating to property. The question in these appeals was whether any provisions in Pt 5.3A of the Act permit a majority at a creditors' meeting who vote for a Deed of Company Arrangement to destroy the rights of minority creditors which consist of causes of action in negligence, or for false, misleading or deceptive representations, or for breach of fiduciary duty, or under a guarantee, against persons other than the company which is the subject of the Deed. But the essence of the present problem is not limited to that category of choses in action which comprises rights to sue on claims of the type just described. If the plaintiffs fail in these proceedings, it will follow that a Deed of Company Arrangement can validly provide that specialty debts or simple debts owed by a person other than the company subject to that Deed to a creditor of that company can be cancelled. The creditor of a company could have its right to sue its bank for monies on deposit with that bank cancelled. There is no doubt that specialty debts or simple contract debts – which can be charged, assigned or devised – are proprietary rights for most purposes of the general law. Lehman Holdings, Lehman Asia, Lehman Australia and the Deed Administrators submitted that the legislative language did permit that course. The plaintiffs denied that. If the plaintiffs are not correct, there will have been, as the Australian Securities and Investments Commission correctly submitted, "a significant intrusion into the individual rights of creditors." Lehman Holdings, Lehman Asia, Lehman Australia and the Deed Administrators submitted that their construction was to be preferred because Pt 5.3A assumed and intended that the affairs of companies in administration should be worked out speedily, flexibly, informally, cheaply and creatively. It was submitted that it was important that if a majority of creditors thought that a Deed gave a better return than liquidation, their "commercial acumen and judgment" should prevail. In Mabo v Queensland [No 2]42 Deane and Gaudron JJ said that it is a rule of construction that "clear and unambiguous words be used before there will be imputed to the legislature an intent to expropriate or extinguish valuable rights relating to property without fair compensation". The rule exists because the compulsory acquisition or extinguishment of property rights – whether that acquisition or extinguishment is effected directly by the legislature, or by the executive acting under supposed legislative power, or, as here, by non- governmental entities taking advantage of a facility supposedly conferred by the legislature – is a serious thing. It is an even more serious thing if the compulsory acquisition or extinguishment is unaccompanied by fair compensation. That remains true however important it is that the affairs of companies in administration be worked out speedily, flexibly, informally, cheaply and creatively, and however much confidence majority creditors may have in their own commercial acumen and judgment. On the arguments advanced by Lehman Holdings, Lehman Asia, Lehman Australia and the Deed Administrators it would be open to a company and its creditors to enter a Deed which extinguished the rights of minority creditors to sue persons other than the company without any fair compensation – for the grounds on which the Court may terminate a Deed of Company Arrangement under s 445D or set aside the relevant resolution under s 600A do not in terms include the absence of fair compensation. A Deed may extinguish the rights of minority creditors against the company itself without compensation, for although the rule of construction must be applied to the operation of the statute in that regard, the words are sufficiently clear and unambiguous. However, in relation to a contention that the statute permits the extinguishment of the proprietary rights of minority creditors against persons other than the company without fair compensation, the rule of construction poses the inquiry whether there are clear 42 (1992) 175 CLR 1 at 111; [1992] HCA 23. The rule may also be stated as being that clear and unambiguous words must be used before legislation will be construed as expropriating or extinguishing valuable rights relating to property without fair compensation. and unambiguous words supporting that quite different outcome. That is an inquiry which was not fruitful for those opposing the plaintiffs. The submissions of Lehman Holdings, Lehman Asia, Lehman Australia and the Deed Administrators paid no regard to the rule of construction stated by Deane and Gaudron JJ. They approached the problem as if it were for the plaintiffs to find words prohibiting what the Deed of Company Arrangement did, rather than for them to find words permitting what it did. Thus Lehman Asia criticised Rares J for relying on authorities asserting that the courts will not attribute to the legislature an alteration of common law principles unless this "is manifested according to the true construction of the statute", to use words approved by the whole Court in American Dairy Queen (Qld) Pty Ltd v Blue Rio Pty Ltd43. Lehman Asia submitted that it was not appropriate for the provisions of remedial legislation like Pt 5.3A to be read down by reference to a presumption which is "inconsistent with modern experience and borders on fiction". The language which Lehman Asia thus quoted was that of McHugh J in Gifford v Strang Patrick Stevedoring Pty Ltd44. But McHugh J was not applying that language to the rule of construction stated by Deane and Gaudron JJ in Mabo's case. Mabo's case is quite a recent case. What was said in it cannot be regarded as out of touch with modern experience. Nor, in this Court of all places, can it be regarded as bordering on fiction. As counsel for Lehman Holdings accepted, what McHugh J was discussing was not rights relating to property, but a particular and different category of "the common law rights of individuals". McHugh J said that there was a presumption that a statute was not intended to alter or abolish common law rights unless it evinced a clear intention to do so. But he said that the strength of the presumption varied: "The presumption of non-interference is strong when the right is a fundamental right of our legal system; it is weak when the right is merely one to take or not take a particular course of action." The latter category of rights he called "lesser rights". It was those lesser rights to which McHugh J applied the language quoted by Lehman Asia45. A proprietary right, or a right relating to property, is not in that category. As Mason J said in American Dairy Queen (Qld) Pty Ltd v Blue Rio Pty Ltd, the general presumption about common law rights "has added 43 (1981) 147 CLR 677 at 682 per Mason J (Gibbs CJ, Murphy, Aickin and Brennan JJ concurring); [1981] HCA 65. 44 (2003) 214 CLR 269 at 284 [36]; [2003] HCA 33. 45 Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269 at 284 [36]. See also Malika Holdings Pty Ltd v Stretton (2001) 204 CLR 290 at 298-299 [27]-[30]; [2001] HCA 14. force in its application to common law principles respecting property rights."46 A property right, or a right relating to property, is not a right "merely one to take or not take a particular course of action". Rather it is "a fundamental right of our legal system". Lehman Holdings, Lehman Asia, Lehman Australia and the Deed Administrators contended that interference with the rights of creditors was "no novelty" in insolvency administration. The question is not whether it is novel. Nor is it whether the rights of other creditors under other statutes have been interfered with in the past. Instead the question is whether it is permissible for the rights of the plaintiffs in relation to persons other than Lehman Australia to be interfered with under the instant statute. A key difficulty for those opposing the plaintiffs is that there were no clear and unambiguous words in the statute supporting their preferred outcome. One part of the submissions put against the plaintiffs endeavoured to sidestep this difficulty. It started with the premise that there was no express provision dealing with the compulsory releases of claims by minority creditors other than claims against the insolvent company. It drew from that premise the conclusion that in the absence of any provision prohibiting releases by minority creditors of claims against persons other than the insolvent company, the legislation should be construed so as to permit them. Even if the premise were sound, the conclusion does not follow. If the premise were sound, the correct approach would be to apply Deane and Gaudron JJ's rule of construction, and that would lead to the opposite conclusion. In any event, the premise is only sound in a very narrow sense. It is true that no single provision in express and unmistakably clear terms either authorises or prohibits the releasing in Deeds of Company Arrangement of the claims of creditors other than claims against the company in administration. If there had been, these proceedings would never have gone as far as they have. But, as is demonstrated in the plurality judgment, the statutory language in s 444D(1) sufficiently points against the meaning advocated by Lehman Holdings, Lehman Asia, Lehman Australia and the Deed Administrators47. Further, there is no indication adverse to the plaintiffs in the language creating the general structure of Pt 5.3A. To confer power on majority creditors of an insolvent company to take away the rights of minority creditors of that company against that company is one thing. To confer power on the majority creditors of a company to take away the rights of minority creditors of the company against persons other than the company is another thing – a much wider 46 (1981) 147 CLR 677 at 683 (Gibbs CJ, Murphy, Aickin and Brennan JJ concurring). 47 See reasons of French CJ, Gummow, Hayne and Kiefel JJ at [50]-[55]. and potentially oppressive step. The absence of any explicit indication that the step was taken thus points strongly against the view that it was taken. The length and detail of the provisions that do appear in relation to the position between the creditors and the debtor company is in sharp contrast with the void in relation to the position between the creditors and debtors other than the company. There is no express suggestion in any other part of the Act that the claims of creditors of the company against persons other than the company had any materiality in relation to Deeds of Company Arrangement. Thus the objects stated in s 435A are limited to objects relating to the company and its creditors and members, not other companies. The topics about which an administrator is obliged by s 439A to give information to creditors before a creditors' meeting do not include the topic of creditors' claims against persons other than the company. Nor is that a topic which s 444A(4) requires to be dealt with in the instrument setting out the terms of the Deed of Company Arrangement. Thus s 444A(4)(b) requires a specification of what property of the company is available to pay creditors' claims – ie claims of creditors of the company. But it says nothing about what property of persons other than the company may be preserved from creditors' claims by their extinguishment. And s 444A(4)(d) requires specification of the extent to which the company is to be released from its debts, but not of the extent to which persons other than the company are to be released from their debts. The point is emphasised when the prescribed provisions included in the Deed by s 444A(5) are taken into account48, for the Regulations, Sched 8A, cll 5 and 6, deal, and deal only, with the discharge of creditors' claims against the company and debts due from the company. While the list in s 444A(4) is not exhaustive, both the inclusions and the omissions are significant. The structure of s 444A(4)(b), (d) and (i), incidentally, suggests that in that sub-section "claims" means "claims against the company", and hence that it bears the same meaning in s 444D(1): thus s 444D(1) binds creditors of the company in relation to their claims against the company, not against other debtors. This conclusion is reinforced by s 444H, which provides that the Deed releases the company from a debt – not persons other than the company. Section 444E forbids a person bound by the Deed of Company Arrangement to begin or proceed with a proceeding against the company without the leave of the Court; but neither it nor any other provision forbids a person bound by the Deed of Company Arrangement to begin or proceed with a proceeding against another company owing money to the creditor. It would be extraordinarily anomalous if the creditor were able to sue the third party debtor, even though it could only sue the company itself with the leave of the Court. This suggests that the debts of companies other than the company subject to the Deed of Company Arrangement cannot be affected by it. If that construction were not correct, another injustice would exist as between secured creditors of the insolvent company, and secured creditors of 48 See reasons of French CJ, Gummow, Hayne and Kiefel JJ at [34]. persons other than the company. Section 444D(2) provides that s 444D(1) does not prevent a "secured creditor" from realising or otherwise dealing with the security unless the secured creditor voted for the resolution of creditors leading to the execution of the Deed of Company Arrangement or the Court so orders. The words "secured creditor" identify a sub-class within the class referred to in s 444D(1) – "all creditors of the company". It follows that the protection given to "secured creditors" by s 444D(2) is given only to secured creditors of the insolvent company, not secured creditors of persons other than the insolvent company. In consequence, if the plaintiffs' construction is wrong and creditors (secured and unsecured) of persons other than the insolvent company can have their rights affected by a Deed of Company Arrangement which they voted against, secured creditors of persons other than the insolvent company would be in a worse position than secured creditors of the insolvent company. That conclusion is not only unjust but also irrational. Its injustice and irrationality point to error in the process of reasoning which led to it. The error lies in rejecting rather than accepting the view that a Deed of Company Arrangement cannot affect the rights of those who are creditors of persons other than the insolvent company as such. Further, words like "so far as concerns claims" in s 444D(1) are elastic words, capable of signifying a wide degree of connection in some contexts and a quite narrow degree in others. The rule of construction stated by Deane and Gaudron JJ, when applied to those words, suggests that they bear a narrow meaning conforming to the position of the plaintiffs. It suggests that the very wide construction advocated by Lehman Australia and the Deed Administrators by which the only limitation on the claims referred to in s 444D(1) is that they arise on or before a day specified in the Deed is erroneous. And it suggests that even the narrower connections advocated by Lehman Holdings and Lehman Asia are too wide49. In addition, the constructions propounded by those two parties, which look to connections or associations between the claim against the insolvent company and the other claim, or to interlocking claims against a group of companies of which the insolvent company is part, are nebulous and amorphous. They are tests which it would be very difficult for proposed Deed administrators and creditors to apply. That is particularly so since the statute creates no machinery enabling them to obtain, by compulsory means, information about the claims against persons other than the insolvent company with a view to assessing whether those claims satisfy the tests at all, let alone in the short time available (ie 20 or 25 business days after the administration commences, unless time is extended: s 439A(5)). They are problems accentuated where the tests are modified to turn on the possibility of contribution claims or apportionable claims – for this creates a need to inquire into different regimes under State, Territory and federal law. These are problems not readily capable of solution by reliance 49 See reasons of French CJ, Gummow, Hayne and Kiefel JJ at [46]-[47]. on the right of creditors to apply to the Court under s 445D or s 600A after the Deed has been approved. That places a burden of proof on minority creditors; there is no requirement that the majority creditors justify their favoured course. Many creditors would lack the resources to institute proceedings. To protect the status quo pending examination of the merits of their applications, it would be necessary to hold up the speedy working out of the administration by interlocutory injunctions. Those injunctions could only be obtained at a price, often a dangerous price – offering an undertaking as to damages. These are formidable difficulties. Nor do the extrinsic materials enable the statutory language to be given a meaning adverse to the plaintiffs. A fair amount of toil and time was devoted to assembling those materials and analysing them in argument. Despite this, there can be few cases in which extrinsic materials have been less useful – a large claim, but a true one. The materials were not directed to the present difficulty. The Australian Securities and Investments Commission correctly submitted that the construction given by Fowler v Lindholm50 to Pt 5.1 of the Act is not inconsistent with the construction given to Pt 5.3A by the Full Federal Court in these proceedings. The structure and the detailed terms of Pt 5.1 are quite different from those of Pt 5.3A. In particular, court approval in advance is always required by Pt 5.1; in Pt 5.3A the role of court approval is only belated and occasional – after the Deed of Company Arrangement has been entered, and even then only if a creditor complains. The much more ample oversight of the Court under Pt 5.1 contrasts with the significant things which can be done under Pt 5.3A without court sanction. Against that background there is no inconsistency between the proposition that under Pt 5.1 creditors can be bound in relation to debts owed by persons other than the company, and the proposition that under Pt 5.3A they cannot. It is unnecessary to decide whether Fowler v Lindholm is incorrect, and it is not here suggested that it is incorrect in any way. That is a question for another appeal specifically directed to the problem. Reliance was placed on decisions concerning legislative provisions in other jurisdictions – the United Kingdom, Singapore, Canada and the United States. Some of the statutes were said to have features in common with Pt 5.1, some with Pt 5.3A. These decisions were not of assistance in construing Pt 5.3A, since all of the statutes on which they were based were worded differently. In order 2 made by the Full Federal Court, an answer is given to question 2 which assumes that cl 7.1 of the Deed of Company Arrangement is not limited to claims by creditors against Lehman Australia. If it is so limited, cl 7.1 would not invalidate the Deed, and the appeals, even if they failed in every 50 (2009) 178 FCR 563. other way, would succeed to the extent that a different answer would have to be given to question 2. The same would be true if it were decided that it was unnecessary to answer question 2, for the Full Court's order would have to be modified to that limited extent in favour of each appellant. The notices of appeal did not raise any point that cl 7.1 was so limited. No notice of cross-appeal raising the point was filed by the fourth to sixth respondents. In those circumstances the appeals should be dismissed in their entirety. Although Lehman Australia was not an appellant in either appeal, it adopted the same ultimate positions as the appellants, with at least equal and perhaps more vigour. Those acting for Lehman Australia also acted for the Deed Administrators. Together those three parties were the fourth, fifth and sixth respondents to both appeals. In no sense could their appearances in the appeals be described as submitting appearances. Had they taken an inactive part in the appeals, the appeals would have taken less time and the plaintiffs would have incurred fewer costs. There is no reason why the fourth, fifth and sixth respondents should not be in the same position in relation to costs as the appellants, for they placed themselves in the same interest. The appeals should be dismissed. In each appeal, the costs of the first three respondents should be paid by the appellant and the fourth to seventh respondents.
HIGH COURT OF AUSTRALIA GUMMOW ACJ, MASTER EDUCATION SERVICES PTY LIMITED APPELLANT AND JEAN FLORENCE KETCHELL RESPONDENT Master Education Services Pty Limited v Ketchell [2008] HCA 38 27 August 2008 ORDER Appeal allowed. Set aside orders 1, 2 and 3 of the orders of the New South Wales Court of Appeal made 19 July 2007, and also order 4 save insofar as it deals with costs, and in place thereof order that: there be judgment in favour of the appellant on the Statement of Liquidated Claim issued 15 August 2003, in the sum of $26,043.59 plus interest at the prescribed rate from that date; orders 2, 3, 4 and 5 made by Malpass AsJ on 15 February 2006 be set aside; and (iii) the appeal to the Court of Appeal otherwise be dismissed. On appeal from the Supreme Court of New South Wales Representation C R C Newlinds SC with V V Bedrossian for the appellant (instructed by Meehans Solicitor Corporation) T M Jucovic QC with S J Burchett for the respondent (instructed by McPhee Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Master Education Services Pty Limited v Ketchell Contract – Illegality – Statute not complied with – Appellant franchisor contravened cl 11(1) of Franchising Code of Conduct ("Code") in entering into franchise agreement with respondent franchisee – Section 51AD of Trade Practices Act 1974 (Cth) ("TPA") provided that applicable industry codes must not be contravened by corporations in trade or commerce – Court of Appeal of New South Wales held franchise agreement to be unenforceable due to illegality at common law arising from contravention of Code and s 51AD – Whether contravention of Code and s 51AD resulted in illegality and unenforceability of franchise agreement – Whether legislative purpose of Pt IVB of TPA could be fulfilled without franchise agreement being unenforceable in light of remedies available in Pt VI for contravention of s 51AD. Words and phrases – "code of conduct", "franchise agreement", "illegality". Trade Practices Act 1974 (Cth), s 51AD, Pt IVB. Trade Practices (Industry Codes – Franchising) Regulations 1998 (Cth), Sched, GUMMOW ACJ, KIRBY, HAYNE, CRENNAN AND KIEFEL JJ. Section 51AD, in Pt IVB of the Trade Practices Act 1974 (Cth) ("the Act"), provides that a corporation must not, in trade or commerce, contravene an applicable industry code. The Franchising Code of Conduct1 is such a code. Clause 11(1) of the Code provides that a franchisor must not enter into a franchise agreement2 or receive non-refundable money under a franchise agreement3 unless the franchisor has received from a prospective franchisee a written statement that the prospective franchisee has received, read and had a reasonable opportunity to understand the disclosure document and the Code. Master Education Services Pty Limited ("the appellant"), as franchisor, provided a disclosure document and a copy of the Code to Ms Jean Ketchell ("the respondent") as required4, prior to executing a Franchise Agreement with the respondent on 11 February 2000, but it failed to obtain the statement required by cl 11(1). An appeal by the respondent against a judgment in favour of the appellant for $31,887.71, representing fees payable under the Franchise Agreement of $26,043.59 with interest, was allowed by the Court of Appeal of the Supreme Court of New South Wales5. Mason P delivered the principal reasons, with which Basten JA and Handley AJA agreed. The Court of Appeal held that the contravention of the Code and of s 51AD led to illegality at common law and consequent unenforceability of the Franchise Agreement. The issue on the appeal to this Court therefore concerns the interaction between Pt IVB of the Act and the common law. Procedural history The litigation has a complicated procedural history with a hearing in the Local Court, an appeal to an Associate Judge of the Supreme Court, a remitted hearing by the Local Court, a second appeal to the Supreme Court and the appeal to the Court of Appeal. 1 Scheduled to the Trade Practices (Industry Codes – Franchising) Regulations 1998 (Cth). 2 Clause 11(1)(a). 3 Clause 11(1)(c). 4 Clause 6. 5 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161. Gummow ACJ Kirby Hayne Crennan In August 2003 the appellant brought proceedings in the Local Court at Campbelltown by Statement of Liquidated Claim under the Local Courts (Civil Claims) Act 1970 (NSW), to recover unpaid monthly fees payable under the Franchise Agreement in consideration of the grant of the franchise, together with interest. In her cross-claim the respondent set up contravention by the appellant of the "unconscionable conduct" provision of s 51AC of the Act. In her defence the respondent alleged failure by the appellant to comply with cl 11 of the Code, with the consequence that it was "unlawful for the [appellant] to receive any of the monies claimed by [the appellant] in these proceedings." In the proceedings in the Local Court it was not disputed that the appellant had given the disclosure document to the respondent. Mr T H Hodgson LCM found that the disclosure provisions in the Franchise Agreement had been initialled by the respondent and that she had received legal advice. She had sought and obtained a number of amendments to the Franchise Agreement through her solicitor before the agreement was signed. The respondent had conducted the business on a "trial run" basis for twelve months prior to her signing the Franchise Agreement. These findings were made in connection with his Honour's dismissal of the claim of unconscionable conduct. No challenge is made in this Court to that part of the decision. His Honour went on to find that there had not been compliance with cl 11(1) of the Code. A further ground, that the appellant had not complied with cl 11(2) of the Code, which requires that the prospective franchisor must have received statements from the prospective franchisee that the franchisee has been given advice by any of an independent legal advisor, business advisor or accountant concerning the agreement, before a franchise agreement is entered into, was not pursued to a conclusion before his Honour. The respondent's defence relied upon the appellant's lack of entitlement to enter into the Franchise Agreement or receive the monies claimed by reason of ss 51AD and 51AE of the Act and cl 11(1) of the Code. His Honour did not consider that the contravention made the contract illegal, although damages might be awarded for loss and damage suffered by reason of the contravention, his Honour held, in reliance upon the decision of Windeyer J in The Cheesecake Shop v A & A Shah Enterprises6. [2004] NSWSC 625. Gummow ACJ Kirby Hayne Crennan The judgment of the Local Court was set aside by Malpass AsJ, who remitted the matter for a full determination of the issue with respect to non-compliance with cl 11(1) of the Code7. On the remitted hearing the Magistrate gave judgment for the respondent, on the basis that the Court could not require payment, since it would involve the appellant breaching cl 11(1) by receiving the monies. The respondent adopts that opinion for the purposes of the appeal. On the further appeal Malpass AsJ did not accept this reasoning. He held that The Cheesecake Shop v A & A Shah Enterprises was authority for the proposition that non-compliance with the clause does not render the franchise agreement illegal8. It was against this decision that the respondent successfully appealed to the Court of Appeal. The reasons of Mason P commence with a reference to the general rule of the common law that, if legislation prohibits the making of the contract, the contract does not give rise to any enforceable right or obligation9. In his Honour's view there is no need to seek guidance from implications in the legislative framework10. Section 51AD, read with cl 11 of the Code, directly prohibited the contract in question and the recovery of the monies claimed11. Nothing in the Act expressly or impliedly mitigated the general or ordinary rule12. His Honour did not agree with the view expressed by Windeyer J in The Cheesecake Shop v A & A Shah Enterprises as to the effect of the range of remedies provided by Pt VI of the Act, for contravention of Pt IVB, upon a 7 Ketchell v Master Education Services Pty Ltd [2005] NSWSC 399. 8 Master Education Services Pty Ltd v Ketchell [2006] NSWSC 28. 9 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [28], referring to Trade Practices Commission v Milreis Pty Ltd (1977) 14 ALR 623 at 637 per Brennan J; Yango Pastoral Company Pty Ltd v First Chicago Australia Ltd (1978) 139 CLR 410 at 430; [1978] HCA 42; SST Consulting Services Pty Ltd v Rieson (2006) 225 CLR 516 at 532 [49], 546 [102]; [2006] HCA 31. 10 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [31]. 11 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [30]. 12 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [33]. Gummow ACJ Kirby Hayne Crennan conclusion of illegality13. Mason P observed that in Carlton & United Breweries Ltd v Castlemaine Tooheys Ltd14 it was said that Pt VI was not intended to provide exhaustively for the consequences of a contravention of Pt IV (or Pt V). The passage from the judgment in Carlton & United Breweries v Castlemaine Tooheys, to which his Honour referred, contains a reference to the decision of the Federal Court in Trade Practices Commission v Milreis Pty Ltd15, "where it was accepted that the ordinary consequences which the common law attaches to illegality would flow from a breach of s 45(2)"16. In his Honour's view the combined effect of s 51AD and cl 11 was on all fours with s 45(2)17. In the Federal Court, Rares J has declined to follow the reasoning of the Court of Appeal18. The appellant submits that, whilst its failure to comply with cl 11(1) was a contravention which might have attracted Pt VI, upon application of the respondent to a court invested with the necessary federal jurisdiction19, it did not result in the illegality and unenforceability of the Franchise Agreement made between them. For the reasons which follow that submission should be accepted and the appeal allowed. The correct approach The question on the appeal is whether a franchise agreement is vitiated where it has been entered into by a corporate franchisor which has contravened 13 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [34]. 14 (1986) 161 CLR 543; [1986] HCA 38. 15 (1977) 14 ALR 623. 16 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [36], citing Carlton & United Breweries v Castlemaine Tooheys (1986) 161 CLR 543 at 554- 17 Ketchell v Master Education Services Pty Ltd [2007] NSWCA 161 at [37]. 18 Hoy Mobile Pty Ltd v Allphones Retail Pty Ltd (No 2) [2008] FCA 810 at [93]- 19 The respondent submitted that the Local Court would have lacked that jurisdiction but it is not necessary to the decision on this appeal to enter upon that question. Gummow ACJ Kirby Hayne Crennan the Code, by entering into an agreement without receiving the required statement from the franchisee, confirming the receipt of information about the franchise and the franchisor and that the franchisee has had sufficient time to understand that information. It is not to be assumed that the common law sanction is to apply in the case of every contravention of a prohibition directed to one of the parties to a contract unless the statute contradicts or displaces such an effect. The correct approach to such a question was explained in the following passage in Australian Competition and Consumer Commission v Baxter Healthcare Pty Ltd20: "In Yango Pastoral Co Pty Ltd v First Chicago Australia Ltd21, 'The principle that a contract the making of which is expressly or impliedly prohibited by statute is illegal and void is one of long standing but it has always been recognised that the principle is necessarily subject to any contrary intention manifested by the statute. It is perhaps more accurate to say that the question whether a contract prohibited by statute is void is, like the associated question whether the statute prohibits the contract, a question of statutory construction and that the principle to which I have referred does no more than enunciate the ordinary rule which will be applied when the statute itself is silent upon the question.' That passage was cited by Kerr LJ in Phoenix General Insurance Co of Greece SA v Halvanon Insurance Co Ltd22, where his Lordship said that when a statute contains a unilateral prohibition on entry into a contract, it does not follow that the contract is void23. Whether or not the statute has this effect depends upon the mischief which the statute is designed to prevent, its language, scope and purpose, the consequences for 20 (2007) 232 CLR 1 at 29 [45]-[46] per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ; [2007] HCA 38. 21 (1978) 139 CLR 410 at 423. 22 [1988] QB 216 at 270. 23 [1988] QB 216 at 273. Gummow ACJ Kirby Hayne Crennan the innocent party, and any other relevant considerations. Ultimately, the question is one of statutory construction."24 The statutory provisions and their construction Part IVB was added to the Act by the Trade Practices Amendment (Fair Trading) Act 1998 (Cth) ("the 1998 Act"). The Part commenced on 22 April 1998. It deals with industry codes. Franchising is declared to be an industry for the purposes of the Part25. Part IVB is designed to operate concurrently with State laws which are not "directly inconsistent with it". Section 51AEA states: "It is the Parliament's intention that a law of a State or Territory should be able to operate concurrently with this Part unless the law is directly inconsistent with this Part." The legislative purpose apparent in s 51AEA is to deny any intention to "cover the field" in the sense of the authorities concerning s 109 of the Constitution26. However, so much is presumed in this appeal respecting State (or Territory) legislation. The dispute turns upon the interaction between Pt IVB and the common law, about which s 51AEA has nothing to say. The laws of which it speaks are statute laws of the polities concerned. This reflects the established understanding that s 109 of the Constitution is not directed to displacement of the common law27. That displacement occurs to the extent of the operation upon the common law of the federal statute law in question. The respondent's submission to the contrary should be rejected. 24 See also Yango Pastoral Company v First Chicago (1978) 139 CLR 410 at 413- 414 per Gibbs ACJ; Australian Broadcasting Corporation v Redmore Pty Ltd (1989) 166 CLR 454 at 457 per Mason CJ, Deane and Gaudron JJ; [1989] HCA 15. 25 Trade Practices Act, s 51ACA(3). 26 See, in particular, R v Credit Tribunal; Ex parte General Motors Acceptance Corporation (1977) 137 CLR 545; [1977] HCA 34. As to inconsistency between laws of the Commonwealth and those made by legislatures of the Territories, see Northern Territory v GPAO (1999) 196 CLR 553 at 580 [53], 581-583 [57]-[61], 586 [75]-[76], 636 [219], 650 [254]; [1999] HCA 8. 27 Felton v Mulligan (1971) 124 CLR 367 at 370; [1971] HCA 39; Perre v Apand Pty Ltd (1999) 198 CLR 180 at 247 [183]; [1999] HCA 36. Gummow ACJ Kirby Hayne Crennan Section 51AE of the Act provides that regulations may be made relating to industry codes. They may prescribe an industry code and declare it to be mandatory or voluntary28. Such regulations must be consistent with the Act and for the purposes of giving effect to it29. The Trade Practices (Industry Codes – Franchising) Regulations 1998 (Cth) commenced shortly after Pt IVB was inserted, on 1 July 1998. They prescribe the Franchising Code of Conduct, as it is scheduled to the regulations, and provide that it is mandatory30. The Code has been amended from time to time since 1998. In these reasons reference is made to the provisions of the Code which stood at the time of the events giving rise to the litigation. Section 51AD is not expressed to prohibit entry into a franchise agreement where a franchisor has not complied with the Code. It does not make performance of such an agreement unlawful in that circumstance. Like the statutory provisions in Yango Pastoral Company v First Chicago31, it contains no reference to contracts or transactions32. Its prohibition is directed to compliance with industry codes, which are central to the operation of Pt IVB. An industry code is defined to mean "a code regulating the conduct of participants in an industry towards other participants in the industry or towards consumers in the industry"33. As was pointed out in the passage from Yango Pastoral Company v First Chicago34, cited in ACCC v Baxter Healthcare35, it does not always follow from 28 Trade Practices Act, s 51AE(a) and (b). 29 Trade Practices Act, s 172(1). 30 Regulation 3. 31 (1978) 139 CLR 410. 32 As observed by Mason J: (1978) 139 CLR 410 at 423. 33 Trade Practices Act, s 51ACA(1). 34 (1978) 139 CLR 410 at 423. 35 (2007) 232 CLR 1 at 29 [45]-[46]. Also cited in Phoenix General Insurance Co v Halvanon Insurance Co [1988] QB 216 at 270. Gummow ACJ Kirby Hayne Crennan a prohibition directed to one party to an agreement that the contract is void. In Yango Pastoral Company v First Chicago the statutory prohibition in question36 prohibited a corporation from carrying on any banking business without an authority to do so, and provided a daily penalty for contravention. It was held that securities taken by a corporation which contravened that provision were not rendered void and unenforceable by the Act. Gibbs ACJ observed that it was directed not at the making or performance of particular contracts, but at the carrying on of any banking business37. The statutory provision considered in Australian Broadcasting Corporation v Redmore Pty Ltd38 was addressed to the ABC and enjoined it not to enter certain classes of contract without the approval of the Minister. The section did not specify any penalty. The section was concerned with the manner of exercise of powers conferred by other provisions of the statute and was not directed to outsiders having contractual dealings with the ABC. It followed that the failure by the ABC to observe its internal procedures was no answer to an action against it for breach of such a contract. In the present case, the prohibition in s 51AD is directed to securing compliance by franchisors with the requirements of industry codes, and the consequence of contravention is the grant of remedies provided for in Pt VI of the Act39. In the absence of an express prohibition in the Act, any such prohibition against the making of an agreement, unless there has been compliance with an industry code, must be found by a process of implication, as Mason J observed in Yango Pastoral Company v First Chicago. The Court of Appeal relied upon the terms of cl 11(1) of the Code in concluding that entry into a contract was prohibited by the Act. It may be useful to read together regulations and the Act with which they were made, in order to identify the nature of a legislative scheme which they comprise40. That is not a warrant for the use of the Code to construe, 36 Section 8 of the Banking Act 1959 (Cth). 37 Yango Pastoral Company v First Chicago (1978) 139 CLR 410 at 415. 38 (1989) 166 CLR 454. 39 There is also the possibility of an action under s 51AC. 40 Brayson Motors Pty Ltd (In liq) v Federal Commissioner of Taxation (1985) 156 CLR 651 at 652 per Mason J; [1985] HCA 20. Gummow ACJ Kirby Hayne Crennan and expand, the terms of s 51AD, in particular by reference to the nature of the language of cl 11(1)41. Regulations are to be construed according to ordinary principles of construction42. That requires that they be placed in their statutory context43. In the case of regulations that includes the legislation under which they are enacted44 and with which they are required to be consistent. In the Second Reading Speech of the Trade Practices Amendment (Fair Trading) Bill 199745 it was stated that it was proposed to strengthen legal rights available with respect to unfair business conduct, the enforcement of rights and access to remedies. The Bill was said to achieve these objectives by implementing industry codes of practice and by providing access to protection against unconscionable conduct. The latter is obviously a reference to the inclusion of s 51AC in Pt IVA, to which reference will later be made. In the Explanatory Statement with respect to the regulations which prescribe the Code, it was said that the operation of the franchising sector had been of concern to the Government for many years. The sector was characterised by high levels of dispute, generally arising out of the imbalance of power between franchisors and franchisees. Major problems in the sector included inadequate disclosures by franchisors prior to franchise agreements being entered into. The purpose of the Code is stated to be "to regulate the conduct of participants in franchising towards other participants in franchising"46. This is 41 See also Pearce and Geddes, Statutory Interpretation in Australia, 6th ed (2006) at [3.41]; Webster v McIntosh (1980) 32 ALR 603 at 606. 42 Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 at 398 per Brennan CJ, Dawson, Toohey, Gaudron and McHugh JJ; [1996] HCA 36. 43 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28. 44 One.Tel Ltd v Australian Communications Authority (2001) 110 FCR 125 at 141 45 Australia, House of Representatives, Parliamentary Debates (Hansard), 30 September 1997 at 8799-8800. 46 Franchising Code of Conduct, cl 2. Gummow ACJ Kirby Hayne Crennan consistent with the purpose of Pt IVB, seen in particular in the definition of "industry code". Part 2 of the Code is concerned with the disclosure of information by a franchisor to a franchisee. Clause 6, appearing in that Part, requires a franchisor to give a disclosure document to a prospective franchisee, or a franchisee proposing to renew or extend a franchise, in accordance with Annexure 1 to the Code. That Annexure provides for the content of a disclosure document. Such a document is to commence with advices to a franchisee, including advice that they assess their financial position and obtain independent advice, and is to include information about the franchisor – their business experience, litigation history, and whether they have any criminal convictions. It extends to information about any requirements of the franchisor for the supply of goods and services and the maintenance of a level of such goods and services by a franchisee, any restrictions upon a franchisee's right to supply goods, payments to be made by a franchisee under the agreement, the franchisee's obligations under the agreement and conditions of the agreement, amongst other things. It specifies how and on what basis information concerning earnings of the franchisee is to be given. The information contained in Annexure 1 "must" be included in a disclosure document (cl 9(2)) which "must" be given to a prospective franchisee at least 14 days before they enter into a franchise agreement or pay non-refundable money to the franchisor (cl 10(a)). The purpose of a disclosure document is stated, by cl 9(1), to be: "to give to a prospective franchisee, or a franchisee proposing to enter into, renew or extend a franchise agreement, information from the franchisor to help the franchisee or prospective franchisee to make a reasonably informed decision about the franchise."47 Clause 11 is entitled "Advice before entering into franchise agreement". Clause 11(1) provides: "The franchisor must not: enter into, renew or extend a franchise agreement; or enter into an agreement to enter into, renew or extend a franchise agreement; or 47 Clause 6A in the current version of the Code expands on this. Its provisions were referred to by Rares J in Hoy Mobile Pty Ltd v Allphones Retail Pty Ltd (No 2) [2008] FCA 810 at [94]. Gummow ACJ Kirby Hayne Crennan receive non-refundable money under a franchise agreement or an agreement to enter into a franchise agreement; unless the franchisor has received from the franchisee or prospective franchisee a written statement that the franchisee or prospective franchisee has received, read and had a reasonable opportunity to understand the disclosure document and this code." Part 3 of the Code is concerned with the conditions of a franchise agreement. The term "franchise agreement" is defined, in cll 3(1) and 4, to include an express, oral or implied agreement. The reference to an agreement which may later be found by the courts to exist may suggest that the obligations and prohibitions contained in the Code were not intended to prevent such an agreement arising, but this was not a matter taken up in submissions. The purposes of the scheme of Pt IVB and the Code in question are to regulate the conduct of persons in the franchising industry in order to improve business practices, to provide some protection to franchisees proposing to enter into franchise agreements and to decrease litigation. Those purposes are sought to be achieved, in large part, by ensuring that a prospective franchisee is in a position to make an informed decision about the operation of the franchise and is encouraged to take independent advice before entering into a franchise agreement. The scheme is largely directed to the franchisor, who is obliged to provide that information and advice. Section 51AD may be seen to promote compliance with the Code, by providing, in effect, that non-compliance will amount to a contravention, for which there are remedies available under Pt VI. It is no part of the scheme, and unnecessary to the purposes mentioned, to strike down a contract made by a non-complying franchisor. It is sufficient for the purpose of the scheme that a franchisor is aware of the obligations imposed by the Code and that action may be taken by a franchisee under the Act with respect to a contravention of s 51AD. Section 51AD is not converted into a prohibition upon the making of an agreement where there is non-compliance with the Code because cl 11(1) of the Code is expressed in imperative terms. It is not necessary to resort to the principle that regulations cannot be used to add to or alter provisions in the Act which created them. It is not to be inferred from the language of cl 11(1) that the stated prohibition is to have the result that a contract entered into by a non-complying franchisor is to be void and unenforceable. The use of imperative language in cl 11(1) does not require that conclusion. As was pointed out in Gummow ACJ Kirby Hayne Crennan Project Blue Sky Inc v Australian Broadcasting Authority48, it is necessary to ask whether it was a purpose of the legislation that an act done in breach of the provision should be invalid. In determining the question of purpose, regard must be had not only to the language of the relevant provision but also to the scope and object of the whole statute. It was pointed out in Archbolds (Freightage) Ltd v S Spanglett Ltd49 that, if a court too readily implies that a contract is forbidden by statute, it takes it out of its power to provide remedies according to the circumstances of the case. Pearce LJ was there referring to the use of public policy to hold a contract unlawful. Such an issue does not arise in the present case. The provision of remedies in Pt VI may be seen as directed to the range of circumstances which may arise in cases where there has been a failure by a franchisor to provide some or any information to a prospective franchisee or to evidence the giving of that information and the receipt of the necessary advices, as cl 11(1) requires. In some cases the non-compliance may be such as to warrant the court striking a contract down on the application of a franchisee. Such a result would not necessarily follow upon any breach of cl 11(1), which may not have involved any failure to give the required information or the franchisee not understanding it. Part VI of the Act contains a range of remedies for a contravention of s 51AD (and s 51AC). They include the grant of an injunction with respect to conduct engaged in, or which is proposed to be engaged in, which would constitute a contravention of Pt IVB (or Pt IVA) (s 80), damages (s 82), non- punitive orders (s 86C) and the range of orders laid out in s 87(2), including orders varying contracts and refusing to enforce all or any contractual provisions50. In Murphy v Overton Investments Pty Ltd51 it was said of these remedies that: "This Court has now said more than once52 that it is wrong to approach the operation of those provisions of Pt VI of the Act which deal 48 (1998) 194 CLR 355 at 390-391 [93] per McHugh, Gummow, Kirby and Hayne JJ. 49 [1961] 1 QB 374 at 387 per Pearce LJ. 50 Trade Practices Act, s 87(2)(b), (ba). 51 (2004) 216 CLR 388 at 407 [44]; [2004] HCA 3. 52 Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 at 503-504 [17] per Gaudron J, 510 [38] per McHugh, Hayne and Callinan JJ, 529 [103] per (Footnote continues on next page) Gummow ACJ Kirby Hayne Crennan with remedies for contravention of the Act by beginning the inquiry with an attempt to draw some analogy with any particular form of claim under the general law. No doubt analogies may be helpful, but it would be wrong to argue from the content of the general law that has developed in connection, for example, with the tort of deceit, to a conclusion about the construction or application of provisions of Pt VI of the Act." The 1998 Act also effected amendments to Pt IVA of the Trade Practices Act. The Part at that time contained s 51AA, which provided in general terms that a corporation must not engage in conduct that is unconscionable. It is of some significance that s 51AC was added at the same time as provision was made for the regulation of business conduct as between franchisor and franchisee. Sub-section (1) of that section states that, in trade and commerce, a corporation, in connection with the supply or possible supply of goods or services to a person, should not engage in conduct which is, "in all the circumstances, unconscionable." The section is clearly relevant to a situation of disadvantage, in which a franchisee, not properly informed by a franchisor, might The operation of the Act with respect to a contravention of a provision of the Code therefore stands in marked contrast to a contravention of other statutory regimes which, beyond stating that contravention is an offence, are silent as to the remedial consequences for the relations in the civil law between the parties53. That was the difficulty presented by the terms of the legislation in Yango Pastoral Company v First Chicago54, which provided only for the imposition of a penalty. The Court was nonetheless able to conclude that the legislative purpose, relating to the business of banking, could be fulfilled without the securities being void or unenforceable. At the time of the additions to the legislation which were made by the 1998 Act, the significance for the operation of the Act, as a whole, of the imposition of norms of conduct such as those in s 51AD (and s 51AC) was well Gummow J, 549 [152] per Kirby J; [1998] HCA 69; Henville v Walker (2001) 206 CLR 459 at 501-502 [130]-[131] per McHugh J; [2001] HCA 52; I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at 124-125 [42]- [48] per Gaudron, Gummow and Hayne JJ; [2002] HCA 41. 53 cf Victoria v Sutton (1998) 195 CLR 291 at 305 [36]; [1998] HCA 56. 54 (1978) 139 CLR 410. Gummow ACJ Kirby Hayne Crennan understood from the authorities dealing with s 52 of the Act. In Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc55, decided in 1988, the Full Court of the Federal Court56 said: "Section 52 does not purport to create liability, nor does it vest in any party any cause of action in the ordinary sense of that term; rather, s 52 establishes a norm of conduct, and failure, by the corporations and individuals to whom it is addressed in its various operations, to observe that norm has consequences provided for elsewhere in the Act57." More recently in SST Consulting Services Pty Ltd v Rieson58 it was confirmed that the proscriptions of certain forms of conduct in the Act take several different forms. They may hinge upon the making of a contract, arrangement or understanding (s 45(2)) or focus upon the supply of or acquisition of services, like the exclusive dealing provisions. Making a contract may constitute a contravention of the provisions, but they encompass many other kinds of conduct. Other provisions of the Act prohibit acquisitions of shares or assets in a corporation which may have a particular effect (s 50(2)). Provisions in Pt IVA prohibit unconscionable conduct; the provisions of Pt V prohibit various other forms of conduct including, of course, misleading or deceptive conduct. Part IVB proscribes conduct by reference to industry codes of conduct. The language and purpose of s 51AD does not equate with s 45(2) of the Act, to which the Court of Appeal referred. That sub-section provides that a corporation shall not make a contract or arrangement, or arrive at an understanding, which would have or be likely to have the effect of substantially lessening competition, or give effect to a provision having that effect. The terms of the sub-section are a sufficient basis for distinguishing what was said in TPC v Milreis59 about the operation of the common law to s 45(2), which was referred to in Carlton & 55 (1998) 19 FCR 469 at 473. 56 Lockhart, Morling and Gummow JJ. 57 Brown v Jam Factory Pty Ltd (1981) 35 ALR 79 at 86. 58 (2006) 225 CLR 516 at 526 [26]-[28] per Gleeson CJ, Gummow, Hayne, Heydon 59 (1977) 14 ALR 623. Gummow ACJ Kirby Hayne Crennan United Breweries v Castlemaine Tooheys60 with apparent approval, when construing s 51AD. However, that reasoning was relied upon by the respondent in supporting the approach of the Court of Appeal and further comment is necessary. Earlier authorities cited by the respondent In TPC v Milreis a Full Court of the Federal Court61 was concerned with an argument that ss 87 and 45(2) of the Act were interdependent, in connection with the alleged invalidity of s 87. In concluding that that was not the case, the Court held that the ordinary consequences which the common law applied to illegality would flow from a breach of s 45(2)62. It should be noted that the case was decided on 22 June 1977, before the inclusion of s 4L in the Act63 and before the decision in Yango Pastoral Company v First Chicago64. Section 4L provides that if the making of a contract contravenes the Act, by reason of the inclusion of a particular provision in the contract, then, subject to any order made under ss 87 and 87A, nothing in the Act affects the validity or enforceability of the contract otherwise than in relation to that provision insofar as the provision is severable. In SST Consulting Services v Rieson it was observed that the central proposition of s 4L is that a contract is valid and enforceable, which is the direct opposite of the ordinary rule that a contract, the making of which is illegal, will not be enforced65. What was said in TPC v Milreis must now be read with s 4L and the analysis of that provision in SST Consulting Services v Rieson. The fact that the Act contains elaborate provisions with respect to contraventions of Pt IVB was pointed out in ACCC v Baxter Healthcare66. As 60 (1986) 161 CLR 543 at 554-555. 61 Bowen CJ, Brennan and Deane JJ. 62 (1977) 14 ALR 623 at 629-631 per Bowen CJ, 636-640 per Brennan J, 645-646 per 63 By the Trade Practices Amendment Act 1977 (Cth), which commenced on 1 July 1977. 64 Which was delivered on 2 November 1978: (1978) 139 CLR 410. 65 (2006) 225 CLR 516 at 528 [34]. 66 (2007) 232 CLR 1 at 29 [46]. Gummow ACJ Kirby Hayne Crennan Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ there observed, the Act is far from being silent upon the question of the consequences of illegality. The intention, that contravention of Pt IVB would attract the range of remedies under the Act, including injunctive relief and damages, is confirmed in the Explanatory Memorandum to the Bill67. It is not to be inferred that the more drastic consequences of the common law were intended to follow upon a contravention of a code of conduct. The respondent relied upon the rejection, in Carlton & United Breweries v Castlemaine Tooheys, of a submission that the Act "is a code and that the only consequences which flow from any contravention of the provisions of the Act are those for which the Act itself provides [in Pt VI]."68 The submission was made with respect to a subsidiary argument in that case. The principal issue turned upon the interpretation of what was the then conferral, by s 86 of the Act, of jurisdiction upon the Federal Court to hear and determine proceedings under Pt VI of the Act, that jurisdiction being "exclusive of the jurisdiction of any other court", other than that conferred on the High Court directly by s 75 of the Constitution. This Court held69 that the Supreme Court of New South Wales had jurisdiction to entertain a defence to an action to enforce a contract, that the contract was "in breach of" s 45 and s 45D of the Act and that certain terms could not be implied because such a contract would contravene those provisions, and that the determination of the matters the object of the defence was not exclusively within the jurisdiction of the Federal Court. The Court had assumed that these matters of defence nevertheless arose under the Act70. It is not necessary to discuss the Court's reasoning further, as it does not bear upon the issues in this appeal. In rejecting the submission that Pt VI was a "code", the Court in Carlton & United Breweries v Castlemaine Tooheys71 identified a number of provisions which show that the Act itself does not intend Pt VI to provide for all 67 Explanatory Memorandum to the Trade Practices Amendment (Fair Trading) Bill 68 (1986) 161 CLR 543 at 554. 69 (1986) 161 CLR 543 at 550, 555. 70 (1986) 161 CLR 543 at 551. 71 (1986) 161 CLR 543 at 554. Gummow ACJ Kirby Hayne Crennan consequences: provisions such as ss 45(1) and 45B(1), which provide that certain contractual provisions or covenants are unenforceable; s 87(5), which provides that the powers under the section do not affect any other powers a court may have in relation to a contract or covenant in proceedings before it; and s 163A, which provides for the making of declarations and orders as to the operation and effect of certain provisions of the Act and as to the validity of an act, including orders by way of prohibition, certiorari and mandamus. These references do not support an argument that the Act as a whole is not intended to provide for the consequences of a contravention of its prohibitions upon conduct. The provision made for consequences other than those provided in Pt VI highlight the extent to which the Act does so provide. The term "code", with respect to the Act, may be more apt to confuse than enlighten. The operation of the Act was recently described in SST Consulting Services v Rieson as follows72: "The Act does much more than proscribe (with the elaborations mentioned) certain forms of conduct. It contains detailed provisions, in Pt VI, dealing with the enforcement of the Act and providing remedies for past or proposed contraventions of the Act. In addition, particular provision is made for the extent to which certain contractual provisions are enforceable." The majority went on to refer, in that regard, to s 45(1). Conclusion The detailed provision by the Act for the consequences of non-compliance with an industry code, such as the Franchising Code of Conduct, does not support a conclusion that it was intended that the harsh consequences provided by the common law were to follow upon contravention of s 51AD. The Act provides a more flexible approach. It allows a court to prevent entry into a franchise agreement, to vary the terms of an agreement entered into in breach of the Code, or to terminate such an agreement or provide compensation for loss and damage, if it is shown to have been caused by the contravention. In that regard the extended meaning which may be given to loss and damage by s 82, which is 72 (2006) 225 CLR 516 at 526 [29] per Gleeson CJ, Gummow, Hayne, Heydon and Gummow ACJ Kirby Hayne Crennan suffered by reason of entry significance73. into contractual obligations, may assume The final matter which supports the non-applicability of the common law sanction for contravention of s 51AD has regard to the position of the franchisee. One of the purposes of the Code is the protection of the position of the franchisee. It is not expressed to prohibit the franchisee from entering into an agreement where a franchisor had not complied with cl 11. As Rares J pointed out in Hoy Mobile Pty Ltd v Allphones Retail Pty Ltd (No 2)74, it would be an unusual result if, in that circumstance, a franchisee's bargain was struck down in every case, regardless of the position in which it places the franchisee. It is not to be assumed in every case that a franchisee wishes to be relieved of their bargain. To render void every franchise agreement entered into where a franchisor had not complied with the Code would be to give the franchisor, the wrong-doer, an opportunity to avoid its obligations75, and at the same time to place the franchisee in breach of obligations to third parties. A preferable result, and one for which the Act provides, is to permit a franchisee to seek such relief as is appropriate to the circumstances of the case. Some cases of non-compliance with cl 11 might involve substantial non-disclosure; others may only involve a failure to obtain the written statement, confirming that the franchisee has read and understood the disclosure document and the Code. This is such a case. Section 51AD does not in its terms prohibit the making of a franchise agreement where a franchisor has not complied with the Code. That section and the Code are concerned with the regulation of the conduct of participants in the franchising industry; in particular the conduct of franchisors. It is not to be inferred from a purpose which promotes or prescribes better and fairer business practices that contractual relations between parties will be affected. As was pointed out in SST Consulting Services v Rieson76, the Act is far from being silent upon the question of the consequences of illegality, but, rather, contains elaborate provision. That is not to say that the express provisions of the Act answer all 73 Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31 at 33 per Black CJ, 42-43 per Gummow J, 46-48 per Cooper J. 74 [2008] FCA 810 at [103]-[104]. 75 See also Yango Pastoral Company v First Chicago (1978) 139 CLR 410 at 426 per 76 (2006) 225 CLR 516 at 527 [30]. Gummow ACJ Kirby Hayne Crennan questions that may arise, but they answer many of them, and set the context in which others are to be answered. The provision made by the Act, in Pt VI, for remedies for contraventions of Pt IVB, and the unconscionability provisions of Pt IVA, tell strongly against an intention that the common law remedy for illegality was to apply. Such a conclusion is reinforced by the disadvantage which may be caused to a franchisee, which would not be consistent with the purposes of Pt IVB and the Code. It follows that s 4L does not apply to require the severance of the respondent's obligation under the Franchise Agreement to pay monies, as the respondent contended. It is possible to agree with the views of Mason P for the Court of Appeal77 that the "franchisor's breach of cl 11 [of the Code]" was not "inconsequential" and that the "disclosure requirements of [the] Code were clearly enacted for the protection of prospective licensees" without embracing his Honour's conclusion that the remedy implicit in the circumstances was that provided by the common law. The context of the Act itself, and the range of remedies that it affords for an established breach of an industry code, produce the conclusion that the better view of the legislation is that propounded by the appellant. It is that view to which this Court should give effect. Orders The appeal should be allowed and the orders of the Court of Appeal of the Supreme Court of New South Wales set aside, save for the orders as to costs. In accordance with the undertaking provided by the appellant the order for costs in the Court of Appeal is not to be disturbed and no order is to be made in its favour on this appeal. In place of the substantive orders of the Court of Appeal, there should be an order (i) for judgment in favour of the appellant on the Statement of Liquidated Claim issued 15 August 2003 in the sum of $26,043.59 plus interest at the prescribed rate from that date, (ii) that orders 2, 3, 4 and 5 made by Malpass AsJ on 15 February 2006 be set aside, and (iii) otherwise dismissing the appeal to the Court of Appeal. 77 [2007] NSWCA 161 at [44].
HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Jenkins v The Queen [2004] HCA 57 17 November 2004 ORDER Appeal dismissed. On appeal from the Supreme Court of Victoria Representation: P F Tehan QC with L C Carter for the appellant (instructed by Worcester & Co) J D McArdle QC with J B Saunders for the respondent (instructed by Solicitor for Public Prosecutions (Victoria)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Jenkins v The Queen Criminal law – Direction to jury – Accomplice warning – Prosecution witness pleaded guilty to criminal offences related to charges against appellant – Testimony of witness substantially undisputed – Defence did not seek to attack credit of witness – Defence case relied in part on evidence of witness – No warning sought at trial as to reliability of witness – Whether trial judge obliged to warn jury that it would be dangerous to convict on uncorroborated evidence of an accomplice – Whether trial judge obliged to warn jury that evidence was potentially unreliable and must be subjected to careful scrutiny. GLEESON CJ, GUMMOW, HAYNE, CALLINAN AND HEYDON JJ. Following a lengthy trial in the Supreme Court of Victoria before Coldrey J and a jury, the appellant was convicted of five offences of obtaining a financial advantage by deception, and five offences of dishonestly furnishing false information for the purpose of obtaining a loan. He was sentenced to a term of imprisonment. An appeal to the Court of Appeal of Victoria resulted in the quashing of the convictions for dishonestly furnishing false information, but the convictions for obtaining a financial advantage by deception were upheld1. The appellant argues in this Court that those convictions ought also to have been quashed, on the ground that the trial judge failed to give the jury an accomplice warning in relation to the evidence of a witness called by the prosecution. It is common ground that the Court of Appeal dealt with that issue, adversely to the appellant, on the basis of a factual misunderstanding. Nevertheless, the respondent contends that the appeal should be dismissed for the reason that, in the circumstances of the case, no such warning was necessary. The case against the appellant The offences with which this Court is concerned occurred in the period between May 1988 and August 1989. The appellant was a property developer. He, and companies with which he was associated, obtained financial accommodation in the form of credit or guarantee facilities from the Order of the Sons of Temperance National Division Friendly Society (OST). It is convenient to describe those facilities compendiously as loans. Under the Friendly Societies Act 1986 (Vic), OST was limited in the amount it could advance on the security of a mortgage over commercial land by a "loan valuation ratio" related to the value of the land. The essential allegation against the appellant was that the loans from OST were arranged on the basis of false or misleading valuation reports. OST, the prosecution alleged, was provided with inflated valuations. All of the loans in question were approved by Paul Robinson, the Investment Director of OST. They were arranged on behalf of the appellant by a mortgage broker, Keith Bulfin of McKinley Wilson & Co Ltd. In each case, the loan application was supported by a valuation made by an accredited valuer, Tibor Verebes. Although this was not revealed in evidence, Robinson, Bulfin and Verebes had all pleaded guilty to criminal offences relating to OST's lending to the R v Jenkins (2002) 6 VR 81. appellant. Robinson was discharged without conviction. Bulfin was convicted and sentenced. So also was Verebes. The Court of Appeal mistakenly thought that the convictions of Verebes related to properties different from those with which the appellant was concerned, and that Verebes and the appellant could not have been regarded as accomplices. That was the basis on which the Court of Appeal disposed of the complaint about the absence of an accomplice warning. The confusion probably arose because one of the charges to which Verebes pleaded guilty was a "rolled- up" count of furnishing false information, in the form of valuation reports, to OST. In fact, the information in question related to the very properties the subject of five of the counts against the appellant. In this Court, the respondent conceded that, on the prosecution case at trial, Verebes and the appellant were accomplices. Although the evidence was detailed, and in some respects complicated, the case against the appellant may be reduced to quite simple terms. It is not so easy to formulate the defence. We are presently concerned with counts 2, 5 and 13, 7, and 14 in the indictment. The following facts were admitted. Count 2 concerned land and a building at Glen Crag ("Glen Crag"). On 22 April 1988, the appellant, on behalf of himself or a nominee, contracted to purchase the property for $2.41 million. On 29 April 1988, Verebes produced a valuation report stating that the fair market value of the property was $6.67 million. This valuation was sent to OST. In early May 1988, Toptown Pty Ltd, the appellant's nominee, applied for, and obtained, a loan from OST of $4.2 million, secured by a mortgage over Glen Crag. Counts 5 and 13 concerned a property at 50-60 High Street, Southport ("High Street"). On 30 June 1988, Jenkins Development Corporation Pty Ltd, a company controlled by the appellant, agreed to purchase High Street for $1.45 million. On 29 July 1988, Verebes produced a valuation report stating that the current fair market value of High Street, assuming the conversion and redesign of the building, was $8.17 million and that the "as is" value was $6.5 million. This valuation was sent to OST. In August 1988, Jenkins Development Corporation Pty Ltd borrowed $3.8 million from OST, secured by a mortgage over High Street. On 11 May 1989, Verebes revalued High Street. The new valuation stated that the current fair market value of High Street was $8.186 million and that on completion of refurbishment it would be $9.5 million. This valuation was sent to OST. On 12 May 1989, OST advanced a further $2.61 million which was secured on Glen Crag, High Street, and two other properties. Count 7 related to the Ashmore Commercial Centre ("Ashmore"). On 18 October 1988, Jenkins Development Corporation Pty Ltd agreed to purchase Ashmore for $4 million. On 22 November 1988, Verebes produced a valuation report stating that the current fair market value of Ashmore was $7 million. This valuation report was sent to OST. On 15 December 1988, Jenkins Development Corporation Pty Ltd borrowed $4.5 million from OST, secured by a mortgage over Ashmore. Count 14 related to the Dreamworld Theme Park ("Dreamworld") and a group of properties described as the Great Adventures Cairns Portfolio ("Great Adventures"). In 1989, the appellant entered into negotiations to purchase Great Adventures and Dreamworld. They were ultimately purchased for $150 million. On 10 April 1989, Verebes produced a valuation report stating that the fair market value of Dreamworld was $186.5 million. In its final version, this report allocated $179.5 million to land and improvements and $7 million to business and goodwill. On 6 April 1989, Verebes produced a valuation report relating to Great Adventures, stating that its current fair market value was $53.6 million. Part of the Great Adventures Portfolio was the Cairns Ferry Terminal site, which Verebes valued at $12 million. On 4 August 1989, Verebes revalued the site at $36.5 million, increasing the total valuation of Great Adventures to about $78 million. These valuations were sent to OST and became the basis of a guarantee facility of $96 million and a credit facility of $54 million. The prosecution called independent expert evidence to establish the falsity of all the valuations. It was alleged that the valuation reports were false and misleading in material particulars, that the appellant knew that fact, and that the appellant intended the reports to go to OST in support of his loan applications. The first two of those allegations gave rise to the principal issues relevant to this appeal. The appellant did not give evidence. Bulfin was not called by either side. The evidence of Verebes The financial needs of the appellant, the acquisitions of land, the borrowings from OST, and the valuations were formally admitted at the trial. The main role of Verebes as a prosecution witness was to explain matters of detail in relation to the valuation reports, and to give evidence of his communications with Bulfin, the appellant and OST. O'Bryan AJA said in the Court of Appeal: "Without his evidence it would have been difficult to admit in evidence the valuation reports, or to explain how they came about". In relation to each count, the prosecution led expert evidence to prove that the properties were worth much less than the valuations of Verebes showed. The defence case did not accept that evidence. In considering the defence approach to the evidence of Verebes, it is important to bear in mind that the jury did not know, and the defence did not wish it to appear, that Verebes, by his pleas of guilty, had already admitted the falsity of the valuations. Plainly, cross- examining counsel did not want that to emerge. Furthermore, the evidence of Verebes was in many respects supportive of the defence case. There was, therefore, no attack in cross-examination on the credit of Verebes. Rather, the defence case was to challenge the inferences which the prosecution sought to draw from his evidence, and to use his evidence to justify competing inferences. In a few instances, where the evidence of Verebes was difficult to reconcile with a view of the facts for which the defence contended, the approach of cross- examining counsel was, in effect, to put his instructions to Verebes, elicit the response of Verebes, and leave the matter there. It is possible that, at that stage, no decision had been taken as to whether the appellant would give evidence. This did not amount to an attack on the credit of Verebes, with all the dangers that could involve. Not the least of those dangers was the possibility that it could in some way lead to a revelation of Verebes' conviction and sentence. Counsel's approach to the cross-examination of Verebes was one of understandable caution. In relation to count 2, concerning Glen Crag, the prosecution case was based mainly on the difference between the price for which the property was purchased on 22 April 1988 ($2.41 million) and the amount at which it was valued on 29 April 1988 ($6.67 million). However, Verebes gave evidence about the original inclusion, and later removal at the request of Bulfin, of an "as is" figure, as distinct from a figure assuming complete refurbishment and change of use. He did not say that the appellant spoke to him about that change. He also gave evidence about some rental figures, assuming refurbishment, that he said had been supplied to him by the appellant. That the appellant had supplied these figures was not disputed. In closing address, counsel for the appellant relied strongly on the evidence of Verebes that his instructions, including the instruction to remove the "as is" valuation, came from Bulfin. In relation to this count, the defence case drew support from Verebes. In relation to counts 5 and 13, once again the crux of the prosecution case was that the appellant could not possibly have believed the High Street property was worth $6.5 million when he was purchasing it for $1.45 million. Again, however, Verebes gave evidence about some matters of detail concerning a reference in his valuation report to a proposed lease by Porsche of part of the premises. He said he obtained this information from the appellant. He could not remember whether he was told that the lease proposal was speculative or definite, but said he would have been unlikely to include reference to it if it had been merely speculative. In cross-examination he accepted that the appellant may have said only that he was hoping to get Porsche as a tenant. Defence counsel relied on that evidence in his final address. As to count 7, again the prosecution case was that the appellant must have known that a building bought for $4 million would not have a fair market value of $7 million. Rental figures had been supplied by the appellant to Verebes. Verebes said that these figures were given to him as current rental income. The defence case was that the appellant had supplied the figures to Verebes in good faith. In cross-examination Verebes accepted that a valuer ought to check such figures. As to count 14, the prosecution case about Dreamworld relied on an undisputed fact that Verebes had originally allocated $15 million to goodwill and $171.5 million to land and improvements. This was later altered to $7 million for goodwill and $179.5 million for land and improvements. The evidence showed that OST did not take account of goodwill for the purpose of its loan valuation ratio. Verebes said that he had a conversation with the appellant about the original valuation and that the appellant asked him to speak to Bulfin. It was Bulfin who suggested the adjustment. This evidence was relied upon by defence counsel in address. It was said to show that it was Bulfin, not the appellant, who was directing the valuation process. In relation to Great Adventures, the ferry terminal site was the focus of attention. Verebes said the appellant drew to his notice some newspaper publicity about the value of a comparable site . This was not challenged in cross- examination, although in address counsel disputed the inference to be drawn from it. In final address, defence counsel argued that any valuation errors were attributable to Bulfin and Verebes, but not the appellant. He claimed support for this from some of the propositions agreed to by Verebes in cross-examination. In particular, in cross-examination, counsel put to Verebes, and Verebes agreed, that Bulfin was a very important source of work to him, and that Bulfin regularly put at least subtle pressure on him to increase valuations. By the time of final address, the pressure had been magnified considerably. Because the appellant did not give evidence, and Bulfin was not called as a witness, the defence contention that it was Bulfin, rather than the appellant, who was responsible for any inflation of valuations, and who was the dominant influence behind the valuation process, depended largely upon the evidence of Verebes. Objectively, if highly inflated valuations were being made in respect of properties the appellant had recently bought, or was negotiating to buy, and if those valuations were submitted to OST in support of applications for loans to the appellant and his companies, it was hardly likely that this would have escaped the notice of the appellant. Objectively, it was also improbable that OST would have been forcing upon an unwilling property developer loans in excess of the real value of the mortgaged properties. It is one thing to say that Bulfin was a dishonest and domineering person. It is another thing to say that he was acting as he did independently of the appellant, and solely in his own personal interest. The person with the principal financial interest in all these transactions was the appellant. The defence case depended for such plausibility as it had largely upon the acceptance by Verebes of suggestions put to him in cross-examination about the influence upon him of Bulfin. Without the evidence of Verebes, the jury might well have thought that the defence attempt to isolate the appellant from Bulfin was incredible. Furthermore, since isolating the appellant from Bulfin was a key part of the defence strategy, and since the line taken in cross- examination of Verebes was that he was dominated by Bulfin, the last thing defence counsel would have wanted the jury to hear from the trial judge was that they should or could approach the evidence of Verebes upon the basis that he was an accomplice of the appellant. The defence case was that Verebes was an accomplice of Bulfin, and the appellant was an innocent dupe. The defence suggestion (accompanied by a denial that the valuations were excessive), that if the valuations were inflated this was purely the result of the influence of Bulfin on Verebes, was not founded upon any attack on the credibility of Verebes. Because it was not supported by any evidence from the appellant himself, it depended upon the evidence of Verebes. Verebes was not challenged in cross-examination by the proposition that he was either consciously or unconsciously seeking to minimise his own responsibility and exaggerate the role of the appellant. On the contrary, he was encouraged in his evidence to emphasise the influence of Bulfin and, to a considerable extent, he responded favourably to that encouragement. Trial counsel did not ask the judge to give the jury a warning about the evidence of Verebes. The tactical reason for that is clear. Accomplice warnings The common law imposes on trial judges a duty to warn of the danger of convicting on evidence which is potentially unreliable2. Because of the variety of the circumstances that might exist, in general the law has endeavoured to avoid inflexible rules, and has left it to judges to sum up in the manner best suited to the facts of the particular case3. Judicial experience, however, was regarded as identifying certain, limited, kinds of case which required a departure from that general approach, and which called for a particular kind of warning based upon categorisation of a witness rather than upon some particular feature of the circumstances. Relating unreliability to classes of person, rather than to the circumstances of cases, involved stereotyping of a kind which is now out of favour. Rules developed which obliged a trial judge to warn of the danger of convicting upon the uncorroborated evidence of an accomplice, the victim of a sexual offence, and a child. These were regarded as "cases where the evidence suffers from some intrinsic lack of reliability going beyond the mere credibility of a witness"4. In 1988, the view was expressed in this Court that those categories ought to be regarded as closed, and that, in general, the interests of justice would benefit from allowing trial judges the freedom to tailor a summing up to the exigencies of the case5. In 1982, the Supreme Court of Canada changed the common law in that country to do away with the rigidity of the previous rules6. We are here concerned with the first category, accomplices. As to the second and third categories, the subject has now generally been overtaken by legislation. Even in relation to accomplices, in most Australian jurisdictions the common law has been altered substantially by statute7. The Commonwealth 2 Pollitt v The Queen (1992) 174 CLR 558 at 599 per Dawson and Gaudron JJ. 3 Carr v The Queen (1988) 165 CLR 314 at 318-319 per Wilson and Dawson JJ. 4 Carr v The Queen (1988) 165 CLR 314 at 319 per Wilson and Dawson JJ. 5 Carr v The Queen (1988) 165 CLR 314 at 319 per Wilson and Dawson JJ. 6 Vetrovec v The Queen [1982] 1 SCR 810. eg Evidence Act 1995 (Cth), s 164, Evidence Act 1995 (NSW), s 164, Evidence Act 1906 (WA), s 50 (inserted in 1988), Criminal Code Act 1899 (Qld), s 632 (inserted in 1997). See also Criminal Justice and Public Order Act 1994 (UK), s 32. Evidence Act and the New South Wales Evidence Act, for example, both provide that it is not necessary that a judge warn the jury that it is dangerous to act on uncorroborated evidence, and substitute a more flexible requirement in the case of evidence that may be unreliable, including evidence given by a witness "who might reasonably be supposed to have been criminally concerned in the events giving rise to the proceeding"8. It may be noted in passing that the statutory description just quoted was intended to deal with a long-standing question in the common law as to exactly who should be regarded as an accomplice for the purpose of the rule requiring a warning9. The concession made by the respondent in this Court relieves us of any need to become involved in that debate. The argument has been conducted on the assumption that Verebes was an accomplice of the appellant. Another question was whether the common law rule requiring an accomplice warning was a rule of law, or merely a rule of practice. The generally held opinion was that it was once a rule of practice which later hardened into a rule of law10. The issue was decided by the House of Lords in England in 1954 in the case of Davies v Director of Public Prosecutions11, where Lord Simonds LC stated three propositions: "First proposition: In a criminal trial where a person who is an accomplice gives evidence on behalf of the prosecution, it is the duty of the judge to warn the jury that, although they may convict upon his evidence, it is dangerous to do so unless it is corroborated. Second proposition: This rule, although a rule of practice, now has the force of a rule of law. Third proposition: Where the judge fails to warn the jury in accordance with this rule, the conviction will be quashed, even if in fact there be 8 Evidence Act 1995 (Cth), s 165(1)(d), Evidence Act 1995 (NSW), s 165(1)(d). 9 See, for example, McNee v Kay [1953] VLR 520. 10 Tripodi v The Queen (1961) 104 CLR 1 at 9 per Dixon CJ, Fullagar and Windeyer JJ. The history of the rules about corroboration warnings was discussed by Jacobs J in Kelleher v The Queen (1974) 131 CLR 534 at 564-569 and Ormiston J in R v Rosemeyer [1985] VR 945 at 960-971. 11 [1954] AC 378 at 399. ample corroboration of the evidence of the accomplice, unless the appellate court can apply [the proviso]." These propositions have generally been understood as an accurate summary of the common law in Australia. But they do not exhaust the subject, and they are not to be treated as if they did. The fundamental principle is that the trial judge must give the jury proper and sufficient instructions to enable them to decide the real issue or issues in the case12. The circumstances of cases are infinitely various. To speak of a "person who is an accomplice giv[ing] evidence on behalf of the prosecution" encompasses many different kinds of circumstances. It includes both the trial where the prosecution's case depends upon the jury accepting the evidence given by an accomplice, and the trial where the prosecution leads no evidence-in-chief from the accomplice but simply makes that person available for cross- examination. It is necessary to take account of this variety. Where a warning in the terms proposed in Davies is given, the trial judge will have to explain to the jury what is meant by corroboration (not necessarily using that precise term), and direct their attention to evidence that is capable of being regarded as corroborating the accomplice. For this reason, among others, an accomplice warning is not always welcomed by defence counsel. It frequently means that the prosecution argument will be reinforced by a recitation by the trial judge of all the evidence that is capable of corroborating the accomplice. That, no doubt, is one reason why the Commonwealth and New South Wales Evidence Acts, in their provisions relating to judicial warnings about unreliable evidence, attach significance to whether there is a request for such a warning13. In the practical application of the rule, it must be observed that what is involved is a warning about the danger of "convicting upon the evidence" of the accomplice, unless it is corroborated. This is not a mere incantation. It must be related to a forensic contest, and its operation in a particular case must be explained to the jury by reference to the evidence and the issues. Those issues will be determined partly by the conduct of trial counsel, and might not emerge in final form until the closing addresses. The rule exists for a reason. That 12 Alford v Magee (1952) 85 CLR 437 at 466. 13 Evidence Act 1995 (Cth), s 165; Evidence Act 1995 (NSW), s 165. reason is related to the potential unreliability of accomplices, an unreliability thought to be so well known in the experience of courts that judges are required, not merely to point it out to jurors, but to tell them that it would be dangerous to convict upon the evidence of an accomplice unless it is corroborated. The principal source of unreliability, although it may be compounded by the circumstances of a particular case, is what is regarded as the natural tendency of an accomplice to minimise the accomplice's role in a criminal episode, and to exaggerate the role of others, including the accused. Accomplices are regarded by the law as a notoriously unreliable class of witness, having a special lack of objectivity. The warning to the jury is for the protection of the accused. The theory is that fairness of the trial process requires it. It is a warning that is to be related to evidence upon which the jury may convict the accused. The reference to danger is to be accompanied by a reference to a need to look for corroboration. The hypothesis is that the evidence in question is in contest, and that it inculpates the accused. Why would a jury be directed to consider whether there is corroboration of evidence that is not in dispute? Why would a jury be directed to consider whether there is corroboration of evidence upon which the accused seeks to rely? What is the danger involved in acting on evidence which is accepted by both parties? Following Davies, it was regarded in England as self-evident that the law only requires a direction on corroboration in relation to evidence of an accomplice that is adverse to an accused14. Nor is a direction required in relation to undisputed evidence. It often happens in a criminal trial that a witness who is technically an accomplice is called to give evidence of some fact which is not formally admitted but which, once proved, is not challenged by the defence. Judges are not obliged to warn of a supposed danger of accepting such evidence. It is an aspect of the adversarial system of criminal justice that an accused person may put the prosecution to proof of facts yet, once some evidence of those facts is given, it will emerge that they are not then disputed. If such evidence is given by an accomplice, but is unchallenged, then there may be no occasion for an accomplice warning. In some cases, an accomplice might give evidence, some of which is in contest and some of which is not. The direction would then need to be related to the disputed evidence. Characterising evidence as favourable or unfavourable to an accused may not always be easy. On the other hand, there may be cases where the prosecution, in performance of its duty of fairness, calls an accomplice whose evidence is wholly favourable to, and accepted by, an accused. It would be absurd, and contrary to the rationale of the rule, to require 14 R v Royce-Bentley [1974] 1 WLR 535; [1974] 2 All ER 347. the trial judge, in such a case to give an accomplice warning, sending the jury off on a search for corroboration of evidence on which the accused relies. Although the common law rule about accomplice warnings is a rule of law, and although (subject to the proviso) in the ordinary case the requirement for a warning does not depend upon a request being made by trial counsel, the rule is not so mechanical as to call for a warning in any case in which an accomplice gives any evidence which may be relied upon to establish the prosecution case. The application of the rule must be related to its purpose, and will require a consideration of the issues as they have emerged from the way in which the case has been conducted. If there is an issue which the jury might have to resolve in order to reach a verdict of guilty, and an accomplice's evidence relates to that issue, an accomplice warning must be given if the acceptance of that evidence is or could be a step taken by the jury in reasoning to a finding of guilt. Ordinarily it would be expected that the use to which the accomplice's evidence may be put will be apparent from the examination or cross-examination of the accomplice, or at least from what is said in closing addresses to the jury. That course of evidence, or the addresses, will reveal whether accepting the accomplice's evidence could be a step which the jury would take along the path to a guilty verdict. If the evidence of an accomplice is not controverted, there will be no issue to which the accomplice's evidence relates and which the jury will, or may, resolve in reasoning to a verdict of guilty. In that latter case no accomplice warning will be necessary. It will not be necessary because there is no issue for the jury to decide to which the instruction could relate. The present was a case in which the primary facts established by the testimony of the accomplice were substantially undisputed. Counsel for the appellant elicited from him, in cross-examination, additional facts which formed a basis of the ultimate defence case, and without which the defence case, being unsupported by any evidence of the appellant, would have been hopeless. It is not possible to point to any particular part of the evidence of Verebes concerning which the jury reasonably might have been told they ought to look for corroboration. Each side, in argument, sought to draw competing inferences from the evidence of Verebes. Each side emphasised some aspects of his evidence rather than others. On the prosecution case, virtually the whole of the remainder of the evidence, including the admitted facts, supported the inferences available from the evidence of Verebes and, if there had been a specific challenge to any significant part of his evidence, would have supported his version of events. However, the primary facts that emerged from the evidence of Verebes, as has been said, were largely undisputed. In the circumstances, an accomplice warning would have been inappropriate, and was not required. In the alternative, it was submitted on behalf of the appellant that, even if the case did not call for a warning that it would be dangerous to convict on the evidence of Verebes unless it was corroborated, at least there should have been a warning of the potential unreliability of the evidence and of the need to subject it to careful scrutiny. The answer to that submission, once again, is related to the way in which the trial was conducted, the issues as they emerged, and the use that both the prosecution and the appellant sought to make of the evidence of Verebes. If there had been a substantial contest as to the primary facts which Verebes was called to prove, then there may have been force in the argument. That, however, is not the way in which the trial was conducted. A clear indication of that is the failure of defence counsel to seek any warning of the kind now suggested. Counsel could have sought a warning which did not identify Verebes as someone who might be an accomplice, or involve the trial judge in reciting the evidence that could be regarded as corroborative. Counsel's failure to do so was consistent with the tactical approach taken by the defence towards the evidence of Verebes. As the issues emerged at the trial, the judge was not obliged to give a warning. Conclusion No error has been shown. It is not necessary to consider the proviso. The appeal should be dismissed.
HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Burns v The Queen [2012] HCA 35 Date of Order: 20 June 2012 Date of Publication of Reasons: 14 September 2012 ORDER Appeal allowed. Set aside the order of the Court of Criminal Appeal of the Supreme Court of New South Wales made on 1 April 2011, and in lieu thereof order that: the appeal to that Court be allowed; the appellant's conviction for the manslaughter of David Hay be quashed; and a verdict of acquittal be entered. On appeal from the Supreme Court of New South Wales Representation T A Game SC with G A Bashir and D P Barrow for the appellant (instructed by Legal Aid (NSW)) L A Babb SC with J A Girdham for the respondent (instructed by Solicitor for Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Burns v The Queen Criminal law – Manslaughter by unlawful and dangerous act – Appellant party to joint enterprise to supply methadone to deceased – Deceased died from combined effect of methadone and prescription drug – Whether appellant's supply of prohibited drug to deceased unlawful and dangerous act – Whether sufficient evidence to warrant order for new trial on basis that appellant administered or assisted in administering drug to deceased. Criminal law – Manslaughter by criminal negligence – Appellant party to joint enterprise to supply methadone to deceased – Deceased suffered adverse reaction to drugs in appellant's presence – Appellant failed to obtain medical treatment for deceased – Whether appellant under legal duty to take steps to preserve deceased's life. Words and phrases – "legal duty", "omission", "supplier of prohibited drug", "unlawful and dangerous act". Introduction David Hay ("the deceased") died after ingesting methadone said to have been supplied to him on 9 February 2007 by the appellant, Natalie Burns, and her husband at the Burns' apartment in Belmore, a suburb of Sydney. On 20 July 2009, Mrs Burns was charged on indictment with the manslaughter of the deceased. She was also charged with four counts of supplying a prohibited drug, namely methadone. She pleaded not guilty to the charge of manslaughter and to one count of supplying methadone. She pleaded guilty to the three remaining counts. After trial before a judge and jury, she was found guilty of manslaughter and of supplying methadone. On 23 October 2009, Mrs Burns was sentenced on all counts to a total term of imprisonment of five years and eight months, with a non-parole period of four years and six months expiring on 13 January 2014. Her husband was tried separately on the same charges and convicted of manslaughter but died in custody shortly after he was sentenced. The trial judge directed the jury that if Mrs Burns supplied methadone to the deceased and if that supply was dangerous and if it caused the death of the deceased she could be convicted of manslaughter. That direction was in error. It was not in dispute that the supply of methadone to the deceased was unlawful. However, the Crown case as put to the jury at the end of the trial did not involve a contention that the supply of the methadone was a dangerous act in the sense necessary to support a conviction for manslaughter. The Crown's case was that Mrs Burns and her husband had together injected the deceased with methadone and, in the alternative, that they had assisted the deceased to inject himself with the drug. The Crown alleged that their conduct in doing either of those things was an unlawful and dangerous act which caused the death of the deceased and would support a verdict of guilty of manslaughter. The alternative case of manslaughter by criminal negligence was put to the jury based on Mrs Burns' failure to take steps to call for assistance for the deceased when he was showing signs of an adverse reaction to the methadone following his ingestion of it. Having regard to the trial judge's direction it cannot be known whether Mrs Burns was convicted of manslaughter by criminal negligence, or because the jury thought she supplied methadone to the deceased, that the supply was an unlawful and dangerous act and that it caused his death. Alternatively the route to conviction might have been a finding that she injected or assisted with injecting methadone in the deceased and that that was an unlawful and dangerous act which caused his death. It may be that the basis of the conviction differed between different members of the jury1 The Crown accepted, on the hearing of the appeal to this Court, that the supply of methadone alone could not substantiate the commission of an unlawful and dangerous act. It was necessary to the "unlawful and dangerous act" limb of the Crown case that the jury be satisfied of the role of Mrs Burns either by herself or with her husband in assisting with the injection of the methadone. Counsel for the Crown argued that it was clear throughout the whole trial that the Crown case went well beyond mere supply. Nevertheless the possibility could not be excluded that Mrs Burns was convicted on the basis of the trial judge's misdirection. The appeal was therefore allowed and orders pronounced on 20 June 2012. Having regard to the state of the evidence in relation to the other bases upon which the Crown sought to support a conviction of manslaughter, it is not appropriate to direct a retrial. A verdict of acquittal was entered. My reasons for joining in those orders follow. Before turning to the evidence at trial and the trial judge's direction to the jury in more detail, it is necessary to say something about the law relating to involuntary manslaughter in New South Wales. Involuntary manslaughter The crime of manslaughter is punishable under s 24 of the Crimes Act 1900 (NSW) ("the Crimes Act"). It is defined negatively in s 18. Following the definition of murder in s 18(1)(a), s 18(1)(b) provides: "Every other punishable homicide shall be taken to be manslaughter." The criteria of liability for manslaughter under the Crimes Act are those which give content to the words "other punishable homicide". Those criteria derive from the common law and from the statute. Although the Crimes Act codifies aspects of the criminal law, it does not exclude the common law2. The crime of manslaughter as defined in the Crimes Act includes cases in which the elements of murder are established but the criminal liability of the accused is reduced, by the Crimes Act, to manslaughter. That occurs in cases of provocation3 and substantial impairment caused by an 1 No suggestion was made that the trial judge should have asked the jury to indicate the basis of the verdict  as to whether it is open and appropriate to a trial judge to ask such questions for sentencing purposes, see R v Isaacs (1997) 41 NSWLR 374 2 R v Lavender (2005) 222 CLR 67 at 70 [2] per Gleeson CJ, McHugh, Gummow and Hayne JJ; [2005] HCA 37. 3 Crimes Act, s 23. abnormality of mind arising from an underlying condition4. Manslaughter in those cases is designated "voluntary manslaughter". Punishable homicide for the purposes of s 18(1)(b) otherwise falls into the category of "involuntary manslaughter". That term is used because, unlike voluntary manslaughter, it does not involve the intent to cause death or the other mental elements necessary for murder5. There are two criteria for liability for involuntary manslaughter to be found in the common law. They were stated by this Court in Wilson v The Queen6, and restated in R v Lavender7 in their application to the crime of manslaughter under the Crimes Act. The first is "manslaughter by an unlawful and dangerous act carrying with it an appreciable risk of serious injury". The second is manslaughter by criminal negligence8. The criteria are not necessarily mutually exclusive. The same set of facts may give rise to liability under each of them9. An unlawful act for the purposes of unlawful and dangerous act manslaughter is one which is a breach of the criminal law10. The test for a dangerous act which was adopted by the majority in Wilson11 applied, in modified form, a test formulated by Smith J in the Supreme Court of Victoria in R v Holzer12: 4 Crimes Act, s 23A. 5 R v Lavender (2005) 222 CLR 67 at 70 [2] per Gleeson CJ, McHugh, Gummow (1992) 174 CLR 313; [1992] HCA 31. (2005) 222 CLR 67. 8 R v Lavender (2005) 222 CLR 67 at 70 [2] per Gleeson CJ, McHugh, Gummow 9 R v Willoughby [2005] 1 WLR 1880 at 1885 [19]; R v Evans (Gemma) [2009] 1 WLR 1999 at 2005 [21]; [2010] 1 All ER 13 at 18 [21]. 10 R v Holzer [1968] VR 481 at 482; Pemble v The Queen (1971) 124 CLR 107 at 122 per Barwick CJ; [1971] HCA 20; R v Lamb [1967] 2 QB 981 at 988. See Roberts, "Unlawful and Dangerous Act Manslaughter: R v Wills" (1984) 10 Monash University Law Review 228. 11 (1992) 174 CLR 313 at 332-333 per Mason CJ, Toohey, Gaudron and McHugh JJ. 12 [1968] VR 481 at 482. "the circumstances must be such that a reasonable man in the accused's position, performing the very act which the accused performed, would have realized that he was exposing another or others to an appreciable risk of really serious injury." The modification was the deletion of the word "really" before "serious". The majority explained in Wilson that the test so modified gave "adequate recognition to the seriousness of manslaughter and to respect for human life" while maintaining a clear distinction between manslaughter and murder13. As Gleeson CJ observed in the Court of Criminal Appeal of New South Wales, shortly after the judgment in Wilson had been delivered14: "it should be explained to the jury in appropriate words that the test of what is a dangerous act is objective, not subjective, and that an act is dangerous if it is one that carries with it an appreciable risk of serious injury." The requisite level of risk for the purposes of the common law in Australia is higher than that applied in the United Kingdom. There, liability for unlawful and dangerous act manslaughter requires "an act likely to injure another person"15and an act which "must subject the other person to, at least, the risk of some harm resulting therefrom, albeit not serious harm."16 The question whether an act is "dangerous" involves an assessment of risk in the sense of an ex ante probability that the act will cause serious injury to a person. If no causal pathway with a requisite level of probability can be identified, then the act is not able to be characterised as dangerous. The assessment of risk as "appreciable" is qualitative. The judgment it requires is 13 (1992) 174 CLR 313 at 333 per Mason CJ, Toohey, Gaudron and McHugh JJ. 14 R v O'Neill unreported, Court of Criminal Appeal of New South Wales, 13 August 1992 at 3 per Gleeson CJ, Mahoney JA and Badgery-Parker J agreeing at 6. 15 R v Larkin (1942) 29 Cr App R 18 at 23 per Humphreys J, approved in Director of Public Prosecutions v Newbury [1977] AC 500 at 506-507 per Lord Salmon, Lord Diplock, Lord Simon of Glaisdale and Lord Kilbrandon agreeing at 506, Lord Edmund-Davies agreeing at 509, and in Attorney-General's Reference (No 3 of 1994) [1998] AC 245 at 270 per Lord Hope of Craighead. 16 R v Church [1966] 1 QB 59 at 70; see also Goodfellow (1986) 83 Cr App R 23 at 27, and generally Yeo, Fault in Homicide (1997) at 189-192. linked to the judgment of causation and, like the judgment of causation in such cases, is17: "not a philosophical or a scientific question, but a question to be determined by [the jury] applying their common sense to the facts as they find them they appreciating that the purpose of the enquiry is to attribute legal responsibility in a criminal matter." Those observations are not intended to suggest the form of direction that should be given to a jury. As noted above, the test was set out by the majority in Wilson and what the jury should be told was explained by Gleeson CJ in R v O'Neill18. An example of a direction on dangerousness was given by Hunt CJ at CL in R v Jones19. It is for the jury to decide whether an unlawful act is dangerous in the sense explained in Wilson and Lavender. The question whether there is evidence capable of supporting a finding that the act is dangerous, in the relevant sense, is a matter for the judge. There was nothing in the evidence to support the proposition that the supply of a prescription quantity of methadone to an adult person of ordinary capacity could be characterised as carrying with it an appreciable risk of serious injury. The Crown did not put a case to the jury that supply of methadone to the deceased was itself an unlawful and dangerous act which would support a conviction for manslaughter. Nevertheless, the trial judge directed the jury on the basis that supply alone was capable of being so characterised. The charge of manslaughter based upon supply of a drug to an adult person who dies as a result of its ingestion can raise difficult questions of principle and of the application of principle. The question whether supply can be characterised as dangerous depends upon the circumstances. It may be said that drug use in general is dangerous but as one academic commentator has written20: 17 Campbell v The Queen [1981] WAR 286 at 290 per Burt CJ, Jones and Smith JJ agreeing at 286; approved in Royall v The Queen (1991) 172 CLR 378 at 387 per Mason CJ, 411-412 per Deane and Dawson JJ, 423 per Toohey and Gaudron JJ, 441 per McHugh J; [1991] HCA 27. 18 Unreported, Court of Criminal Appeal of New South Wales, 13 August 1992 at 3 per Gleeson CJ, Mahoney JA and Badgery-Parker J agreeing at 6. 19 (1995) 38 NSWLR 652 at 657 and 663, Levine J agreeing at 664. 20 Wilson, "Dealing with Drug-induced Homicide", in Clarkson and Cunningham (eds), Criminal Liability for Non-Aggressive Death (2008) 177 at 189. "the paradigm of unlawful act manslaughter, and one which limits the role of luck, involves an act which is dangerous in the specific context rather than dangerous as a more general social phenomenon." There may be a case for specific legislation to cover culpable drug induced homicide21. It is undesirable to strain the criteria for liability for involuntary manslaughter at common law in order to cover drug-related deaths at the margins of those criteria22. The application of the common law criterion of unlawful and dangerous act to drug supply and injection cases in the United Kingdom has varied and evolved, reflecting the difficulties which particular cases can throw up23. R v Cato24 concerned consensual but unlawful injection of a user which resulted in his death and was sufficient to establish liability without a separate consideration of dangerousness. The consent of the deceased was not a defence and there was no suggestion that it might be relevant to causation. In R v Dalby25 the accused supplied a drug to the deceased who injected himself. The Court of Appeal identified as a "difficulty" the fact that the supply of the drug was not an act which caused "direct" harm26. The Court said27: 21 See Wilson, "Dealing with Drug-induced Homicide", in Clarkson and Cunningham (eds), Criminal Liability for Non-Aggressive Death (2008) 177 at 191-195; Yeo, "Manslaughter Versus Special Homicide Offences: An Australian Perspective", in Clarkson and Cunningham (eds), Criminal Liability for Non-Aggressive Death 22 Horder, "Homicide Reform and the Changing Character of Legal Thought", in Clarkson and Cunningham (eds), Criminal Liability for Non-Aggressive Death 23 For discussions of the evolution of the case law in the United Kingdom, see: Jones, "Causation, Homicide and the Supply of Drugs" (2006) 26 Legal Studies 139; Williams, "Policy and Principle in Drugs Manslaughter Cases" (2005) 64 Cambridge Law Journal 66. 24 [1976] 1 WLR 110; [1976] 1 All ER 260. 25 [1982] 1 WLR 425; [1982] 1 All ER 916. 26 [1982] 1 WLR 425 at 428; [1982] 1 All ER 916 at 919. 27 [1982] 1 WLR 425 at 429; [1982] 1 All ER 916 at 919. "the supply of drugs would itself have caused no harm unless the deceased had subsequently used the drugs in a form and quantity which was dangerous." Dalby was "explained" in Goodfellow28as "intending to say… that there must be no fresh intervening cause between the act and the death." R v Dias29 resembled Dalby. The accused had handed a syringe containing heroin to the deceased who self-injected and died. Holding that the supply of the heroin was not an "unlawful and dangerous act", the Court of Appeal said that the deceased was an adult who could decide for himself whether or not to inject the heroin30: "His own action in injecting himself might well have been seen as an intervening act between the supply of the drug by the defendant and the death of [the deceased]." Dalby and Dias were referred to with approval by the House of Lords in R v Kennedy (No 2)31. There, their Lordships said32: "the act of supplying, without more, could not harm the deceased in any physical way, let alone cause his death." That observation was underpinned by a particular view of the criminal law as generally assuming the existence of free will33: "generally speaking, informed adults of sound mind are treated as autonomous beings able to make their own decisions how they will act". That view was supported by reference to statements by Glanville Williams34 and Hart and Honore35, which are quoted in the joint judgment36. Exceptions were 28 (1986) 83 Cr App R 23 at 27. 29 [2002] 2 Cr App R 96. 30 [2002] 2 Cr App R 96 at 99 [8]. 31 [2008] AC 269. The long history of Kennedy (No 2) is referred to in the reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [80]. 32 [2008] AC 269 at 274 [7]. 33 [2008] AC 269 at 275 [14]. 34 Williams, "Finis for Novus Actus?" (1989) 48 Cambridge Law Journal 391 at 392. 35 Hart and Honore, Causation in the Law, 2nd ed (1985) at 326. acknowledged in the case of young people, those not fully responsible for their acts, the vulnerable and those subject to circumstances of duress, necessity, deception and mistake. The exceptions were treated by their Lordships as matters relevant to causation. They were also at least arguably relevant to whether the supply of drugs to another creates, by reason of an attribute or condition or circumstance of the other, "an appreciable risk of serious injury". The House of Lords in Kennedy (No 2) was asked the question37: "When is it appropriate to find someone guilty of manslaughter where that person has been involved in the supply of a class A controlled drug, which is then freely and voluntarily self-administered by the person to whom it was supplied, and the administration of the drug then causes his death?" The answer given by their Lordships was38: "In the case of a fully-informed and responsible adult, never." The absolute character of that answer directs attention to the cautious oxymoron "never say never". It is as much applicable to the law as other spheres of life and more so when it relates to an apparently normative statement based upon a narrow factual hypothesis. The joint judgment in this case however applies the proposition, which I accept, that underpins the reasoning in Royall v The Queen39: "that the voluntary and informed act of an adult negatives causal connection". As their Honours point out40 a different approach was taken in Scotland in MacAngus v HM Advocate41. In its discussion of causation, the High Court of Justiciary referred to Kennedy (No 2) and, after referring to Scottish authorities which had not been cited in the House of Lords, said42: 36 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [81]. 37 [2008] AC 269 at 273 [2]. 38 [2008] AC 269 at 279 [25]. 39 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [86]. 40 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [82]-[84]. 41 2009 SLT 137. 42 2009 SLT 137 at 150 [42]. "These Scottish authorities tend to suggest that the actions (including in some cases deliberate actions) of victims, among them victims of full age and without mental disability, do not necessarily break the chain of causation between the actings of the accused and the victim's death. What appears to be required is a judgment (essentially one of fact) as to whether, in the whole circumstances, including the inter-personal relations of the victim and the accused and the latter's conduct, that conduct can be said to be an immediate and direct cause of the death." The Court quoted an observation of Lord Justice-Clerk Thomson who, in the context of civil proceedings in Blaikie v British Transport Commission43, described the problem of causation as "a practical one rather than an intellectual one." He said: "It is easy and usual to bedevil it with subtleties, but the attitude of the law is that expediency and good sense dictate that for practical purposes a line has to be drawn somewhere, and that, in drawing it, the Court is to be guided by the practical experience of the reasonable man rather than by the theoretical speculations of the philosopher." The Court in MacAngus, in a passage quoted in the joint judgment44 which is not necessary to repeat here, could see no reason why the criminal law in Scotland should not adopt a "similar practical, but nonetheless principled, approach."45 The approach favoured in MacAngus, however, does not represent the law in Australia. Ultimately the Court of Criminal Appeal did not decide the question of causation by applying any novel principle. Rather, it held the trial judge's directions in relation to causation were appropriate on the basis that the evidence of the condition of the deceased when supplied with the methadone left open the question whether he was a fully informed and responsible adult at that time46. However, as explained in the joint judgment47, the evidence did not support the proposition that the act of the deceased was not voluntary or informed. It was 43 1961 SC 44 at 49. See also Royall v The Queen (1991) 172 CLR 378 at 423 per 44 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [82]. 45 2009 SLT 137 at 151 [48]. 46 Burns v The Queen (2011) 205 A Crim R 240 at 271 [155] per McClellan CJ at CL and Howie AJ. 47 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [87]. voluntary in the sense that he made his own decision to take the drug. It was informed in the sense that he knew that what he was taking was methadone. I should add that, as appears from the joint judgment48, this is not a case in which the Court has been invited to endorse the approach, also considered by the Court of Criminal Appeal49, that the predictable responses of a sane adult to the act of another can be said to have been caused by that act. In the present case, the concession made by the Crown in this Court may be taken as a concession that there is no evidence upon which it could have invited the jury to conclude that, if Mrs Burns had done no more than supply the deceased with methadone, that was a dangerous act which caused his death. As is explained later in these reasons, that concession is consistent with the basis upon which, after some change in its position between opening and closing addresses, the Crown put its case to the jury. The Crown maintains that if the appeal were allowed on the basis of the trial judge's misdirection, the matter should be remitted for retrial on the basis of the Crown case that Mrs Burns had committed an unlawful and dangerous act by injecting or assisting with the injection of methadone in the deceased, and alternatively was criminally negligent in failing to obtain assistance for him. The latter basis, proposed in support of a retrial rather than entry of a verdict of acquittal, requires some reference to the common law relating to involuntary manslaughter by criminal negligence. Involuntary manslaughter by criminal negligence at common law is made out if the prosecution shows that50: "the act which caused the death was done by the accused consciously and voluntarily, without any intention of causing death or grievous bodily harm but in circumstances which involved such a great falling short of the standard of care which a reasonable man would have exercised and which involved such a high risk that death or grievous bodily harm would follow that the doing of the act merited criminal punishment." 48 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [86]. 49 (2011) 205 A Crim R 240 at 270 [151] per McClellan CJ at CL and Howie AJ. 50 Nydam v The Queen [1977] VR 430 at 445, approved in Wilson v The Queen (1992) 174 CLR 313 at 333 per Mason CJ, Toohey, Gaudron and McHugh JJ; R v Lavender (2005) 222 CLR 67 at 75 [17] per Gleeson CJ, McHugh, Gummow and Hayne JJ; King v The Queen (2012) 86 ALJR 833 at 842 [29] per French CJ, Crennan and Kiefel JJ, 855 [82] per Bell J; (2012) 288 ALR 565 at 575, 591; [2012] HCA 24. Lord Atkin A person has no civil or criminal liability at common law for negligent conduct unless that conduct involves a breach of a duty of care owed to another. The existence and breach of such a duty is a necessary condition of a finding of in Andrews v Director of Public Prosecutions52 equated negligence with "the omission of a duty to take care." In R v Adomako53, Lord Mackay of Clashfern LC observed that "the ordinary principles of the law of negligence apply to ascertain whether or not the defendant has been in breach of a duty of care towards the victim who has died." The question that follows is whether the breach of duty caused the death of the deceased and if so, whether the breach of duty could be characterised as gross negligence and therefore as a crime. The question of whether a given set of facts gives rise to a duty of care is a question for the judge. The question whether the facts exist is a question for the jury54. The issues of duty of care and criminally negligent breach of duty arise most acutely in cases of involuntary manslaughter by omission55. It was the breach of a duty to the deceased by criminally negligent omission that formed the basis of the Crown case against Mrs Burns for manslaughter by criminal negligence. A frequently cited taxonomy of the duties of care that may support a charge of involuntary manslaughter was set out by Yeldham J in R v Taktak56. According to that taxonomy, which should not be regarded as exhaustive, criminal liability may arise for breach of a duty of care owed to another where57: A statute imposes the duty. 51 Kelly v The King (1923) 32 CLR 509 at 515; [1923] HCA 46. 52 [1937] AC 576 at 581. 53 [1995] 1 AC 171 at 187; a decision footnoted with apparent approval by the majority in R v Lavender (2005) 222 CLR 67 at 82 [37] footnote 39. See also Airedale NHS Trust v Bland [1993] AC 789 at 893 per Lord Mustill; R v Evans (Gemma) [2009] 1 WLR 1999 at 2007 [31]; [2010] 1 All ER 13 at 21 [31]. 54 R v Evans (Gemma) [2009] 1 WLR 1999 at 2009 [39]; [2010] 1 All ER 13 at 23 55 Baker, Textbook of Criminal Law, 3rd ed (2012) at 12-005. 56 (1988) 14 NSWLR 226. 57 (1988) 14 NSWLR 226 at 243-244 per Yeldham J, citing Jones v United States of America 308 F 2d 307 (1962). The duty arises from a certain status relationship. The duty arises from a contract. The duty arises from the voluntary assumption of the care of another, so secluding a helpless person as to prevent others from rendering aid. It is the last category of duty that was relied upon by the Crown in this case. In that category, as Yeldham J put it58: "the Crown must prove beyond reasonable doubt that the circumstances were such that the accused was under a duty to care for the deceased, which duty, as a result either of his gross negligence or perhaps of his recklessness, he failed to perform, with the consequence that death was caused or accelerated." A duty of care may also arise where a defendant has played a causative part in the sequence of events which have given rise to the risk of injury, such that "a duty to take reasonable steps to avert or lessen the risk may arise."59 That basis for a duty of care was relied upon by the Court of Criminal Appeal to support their Honours' conclusion that it was open to the jury to find that a duty of care did exist in this case. Against that background of general principle, it is necessary to turn to the evidence at, and conduct of, the trial. The evidence at trial The Court of Criminal Appeal60 outlined the evidence in the case and conclusions said to be supported by that evidence: In February 2007, Mrs Burns and her late husband, who lived in an apartment in Belmore in Sydney, were drug addicts on a methadone treatment program. It was the practice of the prescribing medical practitioner at the treating clinic to explain the effects and side effects of methadone 58 (1988) 14 NSWLR 226 at 240 per Yeldham J. 59 Mitchell v Glasgow City Council [2009] AC 874 at 893 [40] per Lord Scott of Foscote. See also R v Miller [1983] 2 AC 161 at 179; R v Evans (Gemma) [2009] 1 WLR 1999 at 2004 [18]; [2010] 1 All ER 13 at 18 [18]. 60 Burns v The Queen (2011) 205 A Crim R 240. to clients and the risk of an overdose if methadone were used with other drugs61. On 9 February 2007, Mrs Burns received a dose of 130mgs of methadone at the clinic and two takeaway doses of 130mgs each. Mr Burns also received two takeaway doses on that day62. The deceased had suffered serious injuries, including some brain damage, as the result of a motor vehicle accident in April 200563. At the time of his death he had been prescribed drugs known as olanzapine64 and endone65. He had ingested olanzapine66 and cannabis67 in the hours prior to his death. Methadone is a very dangerous drug in combination with other drugs. It can easily cause serious harm or even death to a person who is narcotically naive68. If taken orally methadone is stored in the liver and released over a period of time into the body. Injection of methadone, on the other hand, leads to very high levels of the drug in the brain where respiratory function and blood pressure are regulated69. On 9 February 2007 sometime after 5pm, the deceased attended the Burns' apartment in order to obtain methadone. Mr and Mrs Burns supplied him with methadone70 and either injected him with it 61 (2011) 205 A Crim R 240 at 252 [52] per McClellan CJ at CL and Howie AJ. 62 (2011) 205 A Crim R 240 at 252 [51] per McClellan CJ at CL and Howie AJ. 63 (2011) 205 A Crim R 240 at 250 [32] and 252 [55] per McClellan CJ at CL and Howie AJ. 64 (2011) 205 A Crim R 240 at 246-247 [15] per McClellan CJ at CL and Howie AJ. 65 (2011) 205 A Crim R 240 at 251 [41] per McClellan CJ at CL and Howie AJ. 66 (2011) 205 A Crim R 240 at 253 [59] per McClellan CJ at CL and Howie AJ. 67 (2011) 205 A Crim R 240 at 253 [57] per McClellan CJ at CL and Howie AJ. 68 (2011) 205 A Crim R 240 at 252 [50] per McClellan CJ at CL and Howie AJ. 69 (2011) 205 A Crim R 240 at 254 [67] per McClellan CJ at CL and Howie AJ. 70 (2011) 205 A Crim R 240 at 264 [122] per McClellan CJ at CL and Howie AJ. using equipment they had at the apartment or assisted him to inject himself71. The question whether there was evidence capable of supporting a finding of injection or assisted self-injection was disputed before this Court. Mrs Burns denied having supplied the deceased with methadone and denied having injected him or assisting him to inject himself with it. Shortly after the deceased arrived at the apartment another person, Felicity Malouf, arrived to purchase methadone. She observed the deceased to be unresponsive at the time, and sitting in an armchair72. Ms Malouf and Mr Burns got the deceased up from the chair in which he was sitting and walked him in a circle four or five times. Mr Burns told the deceased that they were going to call an ambulance but the deceased responded "No, no I'm right" or something to that effect73. Mrs Burns came into the room and said that the deceased could not remain. She spoke angrily to her husband. He told the deceased it was time to go and that he would put him outside and keep an eye on him. The deceased got up without assistance and left. Mr Burns followed him out74. On the following day, the deceased's body was discovered in a toilet block at the rear of the apartments75. To access the block, the deceased would have walked down a number of stairs and crossed a yard. It was very likely that the cause of death was the result of a combination of methadone and olanzapine. The level of olanzapine detected in the body of the deceased was high but not lethal. Neither the individual dosage of methadone or olanzapine would 71 (2011) 205 A Crim R 240 at 272-273 [157]-[160] per McClellan CJ at CL and Howie AJ. 72 (2011) 205 A Crim R 240 at 255 [77] per McClellan CJ at CL and Howie AJ. 73 (2011) 205 A Crim R 240 at 255 [78] per McClellan CJ at CL and Howie AJ. 74 (2011) 205 A Crim R 240 at 255-256 [79]-[80] per McClellan CJ at CL and Howie AJ. 75 (2011) 205 A Crim R 240 at 246 [11] per McClellan CJ at CL and Howie AJ. have been fatal by itself but they could have an additive effect76. In combination they could cause unconsciousness and respiratory depression. There was a remote possibility that the olanzapine alone caused the death of the deceased77 There was no evidence that Mrs Burns knew the deceased was not an experienced methadone user, that he had suffered brain damage or that he was on any other, and if so what, medication. The Crown case at trial In his opening address to the jury, the Crown Prosecutor identified two bases for the manslaughter charge against Mrs Burns: In a joint enterprise with her husband she committed an unlawful act, namely supplying the drug methadone to the deceased knowing that he would ingest it either by injection or orally and that for him that was a dangerous thing to do. 2. Mrs Burns breached the duty of care that she owed to the deceased because she failed to render assistance or ask for assistance when he was in need of assistance and insisted that he leave her apartment. The Crown Prosecutor did not suggest in opening that it was the Crown case that Mrs Burns had injected methadone into the deceased's body or assisted the deceased to inject himself with methadone. At the close of the Crown case, in the course of an application by defence counsel for a directed verdict of acquittal of manslaughter, the trial judge asked the Crown Prosecutor to specify the unlawful and dangerous act relied upon by the Crown to support that charge. The Prosecutor said: "as to unlawful the selling of the methadone or the supply of methadone. As to dangerous that it was, on the evidence, within the knowledge of the accused that it was a dangerous drug and it was dangerous to share the drug or to give it away especially to people who are on a program." And further: 76 (2011) 205 A Crim R 240 at 252 [54] and 254-255 [71] per McClellan CJ at CL and Howie AJ. 77 (2011) 205 A Crim R 240 at 253 [63] and 255 [71] per McClellan CJ at CL and Howie AJ. "Then, your Honour, it was further a danger to David Hay because on [the appellant's] statement [he] was already affected when he came to the apartment by something else; drugs or alcohol or both." Defence counsel submitted, in support of his application, that the supply of the drug had not caused the deceased's death because he had made a voluntary and informed decision to take it78. The trial judge held, in effect, that the defence submission was one which might be made to the jury but was not a basis for a directed verdict. Before closing addresses to the jury, a difference emerged between defence counsel and the Crown Prosecutor about the nature of the Crown's unlawful and dangerous act manslaughter case. Defence counsel observed correctly that the Crown had opened its case on supply of methadone to the deceased and submitted that the Crown should put its case to the jury in the way in which it had been opened and not on the basis that Mrs Burns had been involved in the administration of the drug79. The trial judge asked the Crown Prosecutor about the possibility that the deceased was simply given the drug and injected it himself. The simple case that the supply of the drug was the unlawful and dangerous act appears to have been abandoned by the Crown at this point. The Crown Prosecutor responded "[t]hat's where the omission aspect comes in", referring then, in the context of the Crown's criminal negligence case, to the alleged breach by Mrs Burns of a legal duty of care to the deceased. That response by the Crown Prosecutor in answer to the trial judge's question made it clear that, by that stage of the trial, the Crown was not contending that the mere supply of methadone would have constituted an unlawful and dangerous act. Before commencing his closing address, defence counsel again raised with the trial judge the nature of the Crown case. He referred to a suggestion by the Crown Prosecutor in closing address that Mrs Burns' husband had injected the deceased with methadone. Counsel said it had never been his understanding that that was the Crown case. The trial judge rejected the defence complaint, taking the view that the Crown had not changed "the whole fundamentals of the case." In this his Honour was, with respect, incorrect. There was a significant difference between the act of supplying a prescription quantity of methadone 78 Counsel also submitted that the presence of olanzapine in the deceased's body was a possible cause of his death. That submission is not material for present purposes. 79 Supply and administration are distinct offences under the Drug Misuse and Trafficking Act 1985 (NSW). Supply is an indictable offence under s 25 of that Act. Self-administration, administration and aiding self-administration are summary offences under ss 12, 13 and 19 respectively. which could be taken orally and the act of administering the methadone intravenously or assisting the deceased to administer it intravenously. The trial judge's directions In his written directions to the jury, which were largely reflected in his oral directions, the trial judge said that, in order to establish Mrs Burns' guilt of the offence of manslaughter, the Crown had to prove: "that the accused, by an unlawful and dangerous act, or by a grossly negligent omission in breach of a duty of care which she owed to the deceased (or by both such an act and omission) caused the death of David Hay." As to the "unlawful and dangerous act" limb of the Crown case, the trial judge told the jury that, as at 9 February 2007, it was a crime and hence unlawful for a person in New South Wales to supply methadone to another person. Supply for that purpose included "giving or handing the drug over to someone, whether or not by way of sale and whether or not immediately consumed" by the person to whom it was supplied. His Honour went on: "In order for you to be able to find the accused guilty of manslaughter on the basis of 'unlawful and dangerous act' it is necessary that you are satisfied beyond reasonable doubt: that the accused (either by herself or jointly with her husband) did in fact supply methadone to David Hay; and that the act of supplying the methadone was intentional on the part of the accused; and that a reasonable person in the accused's position, performing the very act which the accused performed, would have appreciated that the supply of the methadone was dangerous in that it carried with it a risk of serious injury to David Hay; and that the supply of the methadone caused the death of David Hay in that it substantially contributed to the death." His Honour did not direct the jury that it was necessary to be satisfied beyond reasonable doubt that, as an element of the conduct said to constitute the unlawful and dangerous act, Mrs Burns and her husband had injected the deceased with methadone or assisted him to self-inject. On the criminal negligence limb of the Crown case, the trial judge directed the jury that there may be manslaughter where the accused "voluntarily assumes a duty of care towards another person and by a grossly negligent omission, breaches that duty of care, causing death". His Honour elaborated upon that direction by saying: "If a person voluntarily invites or permits potential recipients to attend his or her home for the purpose of a prohibited drug supply transaction where the drugs are to be consumed on the premises, and where such a recipient may be or become seriously affected by drugs to the point where his or her life may be endangered, the drug supplier has a duty to conduct himself toward the drug recipient without being grossly or criminally neglectful." The decision of the Court of Criminal Appeal The reasons for judgment of the Court of Criminal Appeal were delivered jointly by McClellan CJ at CL and Howie AJ. Schmidt J agreed with them80. There were four grounds of appeal in the Court of Criminal Appeal. The first two related to the question whether Mrs Burns had owed a duty of care to the deceased which she had breached in such a way as to constitute criminal negligence. By the third ground Mrs Burns contended that the verdict of guilty of manslaughter was unreasonable and against the weight of the evidence. The fourth ground was that the trial judge had erred in refusing to withdraw the unlawful and dangerous act case from the jury. All grounds were rejected. On the criminal negligence issue, their Honours held that it was open to the jury to conclude that Mrs Burns was aware of the deceased's state and, even though he had declined assistance, it was open to the jury to determine that she had a duty to seek medical attention for him81. The Court was satisfied that the evidence supported a finding of manslaughter by criminal negligence82. Their Honours said83: "Having regard to the evidence of the deceased's condition, which we are satisfied deteriorated after he had received methadone, it was negligent in the extreme for the appellant to require him to be taken from her apartment and abandoned. An ambulance should have been called. If it had the evidence is persuasive that the deceased would most likely have survived." 80 (2011) 205 A Crim R 240 at 273 [167]. 81 (2011) 205 A Crim R 240 at 263 [114] per McClellan CJ at CL and Howie AJ. 82 (2011) 205 A Crim R 240 at 264-266 [121]-[130] per McClellan CJ at CL and Howie AJ. 83 (2011) 205 A Crim R 240 at 266 [129] per McClellan CJ at CL and Howie AJ. In rejecting the fourth ground, the Court of Criminal Appeal said it did "because, if for no other reason, there was evidence from which the jury could conclude that the deceased did not make a rational, voluntary and informed decision to take the methadone. There being evidence which could satisfy the jury that the deceased was not capable of such a decision his Honour rightly left the matter with the jury." Their Honours held that it was open to the jury to conclude that Mrs Burns or her husband administered the injection85. Nevertheless their Honours treated the unlawful and dangerous act as "supply" rather than "administration" of the drug86: "In the present case it was accepted that the unlawful act for the purposes of the charged offence was the supply of methadone to the deceased without a medical prescription. There was no issue at the trial and it was not submitted to this Court that a breach of this section could not be an occasion for unlawful and dangerous act manslaughter. The debate in this Court was confined to the issue of causation." (emphasis added) Disposition The first four grounds of appeal in this Court, like the first two grounds in the Court of Criminal Appeal, were concerned with whether the evidence disclosed circumstances capable of giving rise to a duty of care owed by Mrs Burns to the deceased, whether a causal connection between her conduct and the death of the deceased could be established on the evidence and whether the judge had misdirected the jury on duty of care and causation. A fifth ground was added by leave at the hearing of the appeal in this Court: "The Court of Criminal Appeal should have held that the trial judge erred in declining the application to remove unlawful and dangerous act manslaughter based on supply of methadone." The disposition of this appeal turns primarily on the fifth ground. 84 (2011) 205 A Crim R 240 at 272 [156] per McClellan CJ at CL and Howie AJ. 85 (2011) 205 A Crim R 240 at 272-273 [160] per McClellan CJ at CL and Howie AJ. 86 (2011) 205 A Crim R 240 at 273 [162] per McClellan CJ at CL and Howie AJ. The trial judge told the jury that they could find Mrs Burns guilty of manslaughter that she they were satisfied beyond reasonable doubt intentionally supplied methadone to the deceased, that a reasonable person in her position would have appreciated that the supply was dangerous in carrying with it a risk of serious injury to the deceased and that the supply of the methadone caused the death of the deceased in that it substantially contributed to his death. That was not the case which had been put by the Crown. The evidence did not exclude the possibility that the deceased was capable of making and made a free and voluntary decision to ingest the methadone and did so himself. Having regard to the state of the evidence and the concession, correctly made by the Crown, a conviction for manslaughter was not open on the basis that Mrs Burns had supplied methadone to the deceased. It is not possible to exclude the hypothesis that the verdict of guilty of manslaughter was based upon that direction. The appeal being allowed on that basis, the question then arose whether there should be a new trial as submitted by the Crown, or entry of a verdict of acquittal as submitted by counsel for Mrs Burns. For the reasons given in the joint judgment, I agreed that the alternative Crown case that Mrs Burns was involved in injecting the deceased with methadone or assisting in injecting him with that drug would not warrant an order for a retrial. As their Honours observe, the state of the evidence did not exclude the reasonable possibility that the deceased injected himself with the methadone without assistance87. It would not have been open to a jury to conclude beyond reasonable doubt that Mrs Burns had engaged in an unlawful and dangerous act by way of injecting or assisting with the injection of methadone in the deceased. There remained the question whether the matter should be remitted for retrial on the basis of involuntary manslaughter by criminal negligence. The question whether the case should be remitted for retrial confined to involuntary manslaughter by criminal negligence required consideration of Mrs Burns' submissions on grounds 1 and 2 in the Court of Criminal Appeal that she did not owe to the deceased the legal duty of care necessary to support a finding of criminal negligence. In rejecting those submissions, the Court of Criminal Appeal adopted the approach taken in a number of English cases. McClellan CJ at CL and Howie AJ referred in particular to the judgment of the 87 Reasons of Gummow, Hayne, Crennan, Kiefel and Bell JJ at [92]. English Court of Appeal in R v Evans (Gemma)88 and the statement in that "when a person has created or contributed to the creation of a state of affairs which he knows, or ought reasonably to know, has become life threatening, a consequent duty on him to act by taking reasonable steps to save the other's life will normally arise." Their Honours held that it was open to the jury to conclude that a duty of care did exist. Their reasoning involved the following steps: Mrs Burns knew that methadone was dangerous90. It was open to the jury to conclude that the deceased was vulnerable because of his naivety as a user of methadone and his physical condition at the time91. Even though the deceased refused medical assistance, it was open to the jury to conclude that Mrs Burns was aware of his compromised state and, even though he declined assistance, to determine that she had a duty, notwithstanding any protestation from the deceased, to seek medical attention for him92. The evidence was capable of supporting the conclusion that the deceased needed assistance to stand or walk, yet Mrs Burns required that he be put outside without further care for his welfare93. Some elements of that reasoning appear to have conflated questions of duty and breach. 88 [2009] 1 WLR 1999; [2010] 1 All ER 13. 89 [2009] 1 WLR 1999 at 2007 [31]; [2010] 1 All ER 13 at 21 [31], cited at (2011) 205 A Crim R 240 at 261 [111]. 90 (2011) 205 A Crim R 240 at 263 [114] per McClellan CJ at CL and Howie AJ. 91 (2011) 205 A Crim R 240 at 263 [114] per McClellan CJ at CL and Howie AJ. 92 (2011) 205 A Crim R 240 at 263 [114] per McClellan CJ at CL and Howie AJ. 93 (2011) 205 A Crim R 240 at 263 [114] per McClellan CJ at CL and Howie AJ. The question was whether there was evidence from which the jury could have found that Mrs Burns owed a duty of care to the deceased and if so, that she breached that duty in such a serious way as to constitute criminal negligence and that the breach caused his death. Applying the taxonomy adopted by Yeldham J in Taktak, there was no statutory duty, no duty arising from a status relationship and no duty arising from contract. Mrs Burns could not be said to have voluntarily assumed the care of the deceased. Nor could it be said that she had so secluded him as to prevent others from rendering assistance. The only remaining basis for the imposition of a duty on her, and the basis relied upon in the Court of Criminal Appeal, was her allegedly causative role in the sequence of events said to have given rise to a risk to the deceased of serious injury or death on his part. As explained in the joint reasons and noted above, it was not open to exclude as a reasonable possibility that the deceased injected himself with the methadone and that his decision to do so was voluntary. For present purposes therefore, the existence of a duty of care relevant to criminal negligence must be determined on the hypothesis, which cannot be excluded, that the deceased did so inject himself. That possibility, which cannot be excluded, marks a point of distinction between this case and cases in which the accused has created a danger to other people, for example by starting a fire, and thereafter failing to take any steps to remove the danger or warn those at risk of the danger94. If the deceased had ingested the drug himself and had rebuffed a suggestion that an ambulance be called, there could be no basis to support a finding that Mrs Burns owed a duty to him. On that hypothesis, which cannot be excluded, the deceased had created the danger to himself. While Mrs Burns may well have been under a strong moral duty to take positive steps to dissuade him from leaving until medical assistance could be called, there was, in the circumstances, no legal duty, breach of which would support a finding of criminal negligence. For these reasons, and the reasons given in the joint judgment, I agree that there should not be a new trial. 94 R v Miller [1983] 2 AC 161. Crennan Bell GUMMOW, HAYNE, CRENNAN, KIEFEL AND BELL JJ. The appellant and her husband supplied methadone to a man named David Hay. David Hay died as the result of the combined effect of the methadone and a prescription drug. The appellant and her husband were each charged with his manslaughter. They were tried separately before the New South Wales District Court (Woods DCJ QC)95. At the appellant's trial, the prosecution case was left to the jury on either of two bases. The first basis was that the supply of the methadone was an unlawful and dangerous act which caused the death of the deceased. The second basis was that the appellant's failure to seek medical attention for the deceased was a grossly negligent cause of his death. The appellant was convicted of the manslaughter of the deceased. The appellant appealed against her conviction to the New South Wales Court of Criminal Appeal (McClellan CJ at CL, Schmidt J and Howie AJ). The principal focus of the appeal in that Court was whether the appellant was subject to a legal duty to take steps to preserve the life of the deceased96. After the hearing of the appeal, the appellant was granted leave to add a further ground challenging the trial judge's refusal to take the case in unlawful and dangerous act manslaughter from the jury97. Little attention appears to have been given to the identification of the unlawful act in the parties' submissions addressing this ground. The Court of Criminal Appeal initially characterised the unlawful act as "the supply of the methadone by injection to the deceased"98. In stating its conclusion, the Court said that it was accepted that the unlawful act was "the supply of methadone to the deceased without a medical prescription"99. It recorded that there had been no issue at the trial or on the appeal that the unlawful supply of a drug "could not be an occasion for unlawful and dangerous act manslaughter"100. In the event, the Court was satisfied that the appellant was complicit in injecting the deceased with the methadone and that "the act of 95 The appellant's husband, Brian Burns, was convicted of the manslaughter of David Hay. 96 Burns v The Queen (2011) 205 A Crim R 240 at 245 [4], 257 [91]. 97 Burns v The Queen (2011) 205 A Crim R 240 at 245 [4], 266 [131]. 98 Burns v The Queen (2011) 205 A Crim R 240 at 245 [8] (emphasis added). 99 Burns v The Queen (2011) 205 A Crim R 240 at 273 [162] (emphasis added). 100 Burns v The Queen (2011) 205 A Crim R 240 at 273 [162]. Crennan Bell injection was unlawful", "plainly dangerous" and caused the death of the deceased101. The Court of Criminal Appeal also considered that the case of negligent manslaughter had been rightly left to the jury. It held that the supplier of a prohibited drug owes a duty of care to a person to whom they supply the drug when the drug is taken in the supplier's presence102. The appellant's appeal against her conviction was dismissed. The appellant was granted special leave to appeal by order of Gummow, Hayne and Heydon JJ on 10 February 2012 on grounds which challenged the existence of the duty, the directions on duty and breach in the case in negligent manslaughter, and causation on either case. On 20 June 2012, this Court made orders allowing the appeal, setting aside the order of the Court of Criminal Appeal made on 1 April 2011 and in lieu thereof allowing the appeal to that Court, quashing the appellant's conviction for the manslaughter of David Hay and ordering the entry of a verdict of acquittal. These are our reasons for joining in the making of those orders. On the hearing of the appeal in this Court, the Crown conceded that the supply of methadone to the deceased without more was not an unlawful act that was capable of supporting the appellant's conviction for manslaughter by unlawful and dangerous act. The appellant was granted leave to add a further ground contending that manslaughter by unlawful and dangerous act should not have been left to the jury. Notwithstanding the Crown's concession, it sought to maintain the jury's verdict. It was submitted that the Crown case at trial had been conducted throughout on the basis that the appellant, or her husband with whom she was acting in concert, had injected or assisted to inject the deceased with the drug. Reliance was placed on the Court of Criminal Appeal's finding103 that such a case had been established beyond reasonable doubt. As will appear, the Crown case at trial shifted in closing submissions from being a case that the appellant was 101 Burns v The Queen (2011) 205 A Crim R 240 at 272-273 [160] (emphasis added). 102 Burns v The Queen (2011) 205 A Crim R 240 at 260-261 [105]-[112]. 103 Burns v The Queen (2011) 205 A Crim R 240 at 272-273 [160]. Crennan Bell complicit in supplying the drug104 to the deceased to a case that she was complicit in administering the drug105 to him. Regardless of the way the Crown case was put in final address, the directions left manslaughter by unlawful and dangerous act on the basis that the act was the supply of methadone to the deceased. Moreover, the underlying joint criminal enterprise was at all times confined to "supply[ing] the prohibited drug, methadone, to David Hay" (emphasis added). For the reasons to be given, the Crown's belated concession in this Court, that the supply of methadone is not capable of supporting the appellant's conviction for manslaughter by unlawful and dangerous act, must be accepted. Since the basis on which the verdict was returned is not known, it follows that the appeal must be allowed. Consideration of the consequential order required attention to the parties' arguments respecting the capacity of the evidence at trial to establish the appellant's liability for manslaughter, either on a case that her unlawful act was the administration of the drug to the deceased or because she was under a legal duty to seek medical assistance for him. In order to understand those arguments, it is necessary to describe the evidence given at the trial in some detail. The evidence at trial The appellant and her husband, Brian Burns, were registered participants in a methadone programme conducted by a Sydney clinic. Each was approved to receive doses of the drug to take away. They were in the business of selling some of their methadone to friends and acquaintances from their home, a unit in Belmore. On Friday, 9 February 2007, the appellant and Brian Burns attended the clinic and each received a dose of methadone. Each was also given two 130 mg doses of methadone to take away. The deceased was on friendly terms with Brian Burns. He made telephone contact with Brian Burns around midday on 9 February 2007. Later that afternoon, the deceased attended his psychiatrist, Dr Roberts. The deceased left Dr Roberts' rooms between 4.30 and 5.00pm. He was noticeably drowsy. He told Dr Roberts that he had taken Endone. 104 Drug Misuse and Trafficking Act 1985 (NSW), s 25(1). 105 Drug Misuse and Trafficking Act 1985 (NSW), s 13(1). Crennan Bell Sometime after 5.00pm on the same day, the deceased attended the Burns' unit to purchase methadone. A woman named Felicity Malouf also attended the Burns' unit that evening to purchase methadone. When she arrived, the deceased was in the lounge room with Brian Burns. The appellant was in another room. Ms Malouf observed that the deceased was "out of it". Brian Burns told her that the deceased had "wanted" or "had taken" some methadone. Ms Malouf did not see syringes or other equipment associated with the injection of drugs in the living room. She and Brian Burns roused the deceased and walked him around the living room several times. Brian Burns said "we're going to call an ambulance" but the deceased said "No, no I'm right". The appellant came into the lounge room and said in an angry tone, "he can't be here like that". Brian Burns told the deceased, "come on mate, it's time to go". He said that he would put the deceased outside and keep an eye on him. The deceased got up and left the unit without assistance. Brian Burns accompanied him out. The appellant and the deceased had been together in the lounge room with Brian Burns and Ms Malouf for around three to four minutes before the deceased left the unit. Ms Malouf and the appellant remained in the unit. Ms Malouf was not overly concerned about the deceased's condition. She did not consider that it was unusual for a person to be sleepy after taking methadone. She had not thought that it was necessary to call an ambulance. The deceased's body was discovered in the toilet block at the rear of the Burns' block of units a little after 12.30pm the following day. The deceased must have walked or been assisted down a number of stairs, crossed a yard and walked up some further stairs to get to the toilet block. No equipment associated with drug taking was found in the vicinity of the body. Several weeks after the discovery of the body, the police installed a listening device in the Burns' unit. Discussions between the appellant and her husband included reference to the deceased's overdose and to him having been "out of it". The appellant spoke of the need to "get rid of those things". She also said that the deceased "had the best outfit, no more". In context, this was a reference to drug injecting equipment. The appellant made a statement to the police on 3 March 2007 in connection with the death of the deceased. She gave the following account of events in that statement. The deceased attended their unit on the evening of 9 February 2007 and he was either drunk or "out of it". Ms Malouf was inside the unit when the deceased arrived and she suggested that they should call an ambulance. The deceased refused the offer. The appellant told her husband to Crennan Bell tell the deceased to leave, the deceased said "Don't worry about me, I'll be right" and got up and walked out of the unit with her husband. The police searched the Burns' unit on 7 March 2007 and found syringes and tubes, known as "butterfly clips", which can be used to inject methadone. Dr Duflou conducted the post-mortem examination. He attributed the cause of death to methadone and olanzapine toxicity. High levels of both drugs were detected in samples taken from the deceased's body. Olanzapine, the active ingredient in the drug marketed as Zyprexa, was detected at about 20 times the expected level for that drug. Methadone was present at 0.2 mg per litre, a level that was not extremely high. Neither drug individually was present in an amount that was necessarily fatal. The deceased was suffering from early pneumonia. This condition may have been developing in any event or may have been the result of breathing difficulties brought on particularly by the consumption of the methadone. Dr Duflou considered that the combination of the two drugs had caused respiratory depression and death. He considered it a "remote possibility" that the olanzapine alone had caused death. Mr Farrar, a pharmacologist, said that it was not possible to determine whether methadone or olanzapine alone could have caused death. He considered that it was "unlikely" that olanzapine alone could have caused death, although he was not able to rule out that possibility. In a conversation between the appellant, Brian Burns and Ms Malouf, which was recorded during the investigation, the appellant and Brian Burns counselled Ms Malouf to give a false account to the police that she had been present at the apartment when the deceased arrived. Ms Malouf gave the police an account along these lines which matched that given by the appellant in her statement. Ms Malouf was charged with concealing a serious indictable offence and with hindering police. She later agreed to cooperate with the authorities and the charges against her were terminated. She gave evidence in the Crown case at the appellant's trial. The appellant was charged in the indictment with four counts of the supply of methadone as well as with the manslaughter of the deceased. Count two was particularised as the supply of methadone to the deceased on 9 February 2007. Count three was particularised as the supply of methadone to Ms Malouf on that day. Counts four and five charged supplies of methadone on 2 March 2007. The appellant pleaded not guilty to the supply of the drug to the deceased but guilty to counts three, four and five. Evidence of these supplies was received at the trial, apparently without objection, as evidence of the appellant's tendency Crennan Bell to supply methadone and to permit the recipients of the supply to consume the drug at her premises106. The appellant did not give evidence or call evidence at the trial. Manslaughter by unlawful and dangerous act – the conduct of the trial As earlier noted, the Crown case on manslaughter by unlawful and dangerous act was opened on the basis that the appellant was a party to a joint criminal enterprise with her husband to supply methadone to the deceased and that the supply of the drug was the unlawful act upon which her criminal liability depended. A difficulty with this case, acknowledged by the Crown in this Court, is evident from the way the Crown Prosecutor dealt with the requirement of dangerousness in opening. He told the jury that the appellant was aware that the deceased would take the drug "either by injection or orally" and "that was a dangerous thing to do". Dangerousness, it will be noted, was not a quality of supplying the drug but of taking the drug. At the close of the Crown case, defence counsel applied for a verdict by direction. He submitted, with respect to unlawful and dangerous act manslaughter, that the supply of the drug was not the cause of the deceased's death. The Crown Prosecutor maintained that it was the prosecution case that the appellant and her husband had "suffered" the deceased to either drink or inject the methadone and that the supply of the drug was a dangerous act because it was within the knowledge of the appellant that it was a dangerous drug. As the argument developed, the Crown Prosecutor also submitted that "the dangerous and unlawful act, apart from having obvious qualities in it included that [the deceased] was either assisted in injecting or was injected". The trial judge queried the foundation for the latter submission, to which the Crown Prosecutor responded: "There wasn't any evidence that he was actually injected rather than injected himself but the Crown relies on the several circumstances which point to that being a possibility". Defence counsel complained that the shift to a case that the appellant was complicit in administering the drug was a departure from the Crown case as particularised and conducted. The possible significance to the appellant's liability of the distinction between the supply and the administration of a 106 Evidence Act 1995 (NSW), s 97. Crennan Bell prohibited drug was not explored. The trial judge ruled that it was open to the Prosecutor to invite the jury to infer that the appellant was complicit in injecting or assisting to inject the drug. However, his Honour directed the jury that the prosecution alleged a joint criminal enterprise between the appellant and her husband to supply the methadone to the deceased, and that liability for manslaughter by unlawful and dangerous act was based upon the intentional supply of methadone to the deceased. Turning to causation, his Honour directed that the supply of the methadone must have made a substantial contribution to the death of the deceased and that it would not have done so if the "true cause of David Hay's death was the simple fact that he made a rational, voluntary and informed decision to take the methadone" (emphasis in the original written direction). In determining whether the deceased's act was rational, voluntary and informed, the jury was invited to: "[C]onsider – amongst other matters you think relevant – the evidence as to David Hay's condition when he arrived at the Burns' flat, evidence from the post-mortem as to the condition of his brain, what he may or may not have known about methadone and its effects, and what he may or may not have known about the injection of drugs. You may think that David Hay was a rational adult man, who knew what he was doing so far as drugs were concerned, understood what methadone was and did, and voluntarily took it. … On the other hand, you might think that he died precisely because he did not know about methadone and its effects, that he already suffered some degree of brain damage from an earlier car accident, that by the time he took methadone he was already affected by olanzapine he had ingested, and so cannot be regarded as a person acting as a rational adult making an informed choice about taking methadone" (emphasis in the original written direction). Manslaughter by unlawful and dangerous act – the supply of the methadone In New South Wales, the elements of the offence of manslaughter are supplied by the common law107. Manslaughter by unlawful and dangerous act requires that the unlawful act causing death be an objectively dangerous act. A dangerous act is one that a reasonable person would realise exposes another to an 107 R v Lavender (2005) 222 CLR 67 at 76 [21] per Gleeson CJ, McHugh, Gummow and Hayne JJ; [2005] HCA 37. Crennan Bell appreciable risk of serious injury108. The quality of dangerousness inheres in the unlawful act. The unlawful act must be the cause of death. To supply drugs to another may be an unlawful act but it is not in itself a dangerous act. Any danger lies in ingesting what is supplied. There has not been any extended consideration in Australia of the application of the law of manslaughter to the illicit supplier of a drug that, when taken by the person to whom the drug is supplied, causes that person's death. But these issues have been explored by the English and Scots courts and it is useful to consider how these courts have dealt with them. The Crown's concession in this case, that the supply of methadone to the deceased was not a dangerous act, accords with English authority that the supply of a controlled drug cannot support a conviction for unlawful and dangerous act manslaughter since the act of supply, without more, could not harm the deceased in any physical way109. The correctness of this conclusion was affirmed by the House of Lords in R v Kennedy (No 2)110. The Court of Criminal Appeal confined its analysis to causation and did not address the anterior question of whether the act of supply of the prohibited drug was relevantly "dangerous". It was disinclined to follow the English approach, that manslaughter by unlawful and dangerous act cannot be established where the supply of the drug is to a person who is a "fully informed and responsible adult"111. The Court preferred the approach adopted in Scotland in drug homicide cases112. 108 Wilson v The Queen (1992) 174 CLR 313 at 332-333 per Mason CJ, Toohey, Gaudron and McHugh JJ; [1992] HCA 31. 109 R v Dalby [1982] 1 WLR 425 at 429; [1982] 1 All ER 916 at 919. 110 [2008] AC 269 at 274 [7]. 111 Burns v The Queen (2011) 205 A Crim R 240 at 270 [150]. 112 Burns v The Queen (2011) 205 A Crim R 240 at 270 [148], citing MacAngus v HM Advocate 2009 SLT 137. Crennan Bell There was no issue in Kennedy (No 2) that liability for unlawful and dangerous act manslaughter could not depend on the act of supply alone113. Kennedy (No 2) resolved a controversy concerning the liability of the person who provides assistance to the deceased in injecting the prohibited drug. In question was whether Kennedy's acts of preparing a dose of heroin and giving the syringe to the deceased at the deceased’s request amounted to "administering" the drug contrary to the statute114. Kennedy's initial appeal against his conviction was dismissed by the Court of Appeal (Criminal Division)115 in a decision that proved to be controversial116 and which was later distinguished117. Subsequently, the Criminal Cases Review Commission referred Kennedy's conviction back to the Court of Appeal118. The Court of Appeal again affirmed the conviction, holding on this occasion that Kennedy had been jointly engaged in administering the drug119. It certified the following question for the opinion of the House of "When is it appropriate to find someone guilty of manslaughter where that person has been involved in the supply of a class A controlled drug, which is then freely and voluntarily self-administered by the person to whom it was supplied, and the administration of the drug then causes his death?" The House of Lords answered the certified question: "In the case of a fully-informed and responsible adult, never."121 Their Lordships' analysis of 113 R v Kennedy (No 2) [2008] AC 269 at 274 [7]. 114 Offences against the Person Act 1861 (UK), s 23. 115 R v Kennedy [1999] Crim LR 65. 116 R v Kennedy [1999] Crim LR 65 (commentary by J C Smith) at 67-68; Ashworth, Principles of Criminal Law, 3rd ed (1999) at 129; Simester and Sullivan, Criminal Law: Theory and Doctrine, 3rd ed (2007) at 94-96. 117 R v Dias [2002] 2 Cr App R 96. 118 Criminal Appeal Act 1995 (UK), s 9. 119 R v Kennedy (No 2) [2005] 1 WLR 2159 at 2174-2175 [51]-[53]. 120 R v Kennedy (No 2) [2008] AC 269 at 273 [2]. 121 R v Kennedy (No 2) [2008] AC 269 at 279 [25]. Crennan Bell causation proceeded upon acceptance that the law treats informed adults of sound mind as "autonomous beings able to make their own decisions how they will act"122. They referred with approval to Glanville Williams' statement of the principle123: "I may suggest reasons to you for doing something; I may urge you to do it, tell you it will pay you to do it, tell you it is your duty to do it. My efforts may perhaps make it very much more likely that you will do it. But they do not cause you to do it, in the sense in which one causes a kettle of water to boil by putting it on the stove. Your volitional act is regarded (within the doctrine of responsibility) as setting a new 'chain of causation' going, irrespective of what has happened before." And to that of Hart and Honoré124: "The free, deliberate, and informed intervention of a second person, who intends to exploit the situation created by the first, but is not acting in concert with him, is normally held to relieve the first actor of criminal responsibility." In Scotland, the supply of a controlled drug has been found to be a legal cause of the death of an adult who voluntarily consumed the drug125. This decision follows Khaliq v HM Advocate126, in which the supply of solvents to children was held to be capable of being the cause of injury to children who inhaled the vapours from them. In MacAngus v HM Advocate127, a bench of five was constituted to review this line of authority in the light of the decision in Kennedy (No 2). In issue were preliminary challenges to counts charging culpable homicide against two accused. In one case, the unlawful act was the 122 R v Kennedy (No 2) [2008] AC 269 at 275 [14]. 123 R v Kennedy (No 2) [2008] AC 269 at 275 [14], citing Williams, "Finis for Novus Actus?", [1989] Cambridge Law Journal 391 at 392. 124 R v Kennedy (No 2) [2008] AC 269 at 275-276 [14], citing Causation in the Law, 2nd ed (1985) at 326. 125 Lord Advocate's Reference (No 1 of 1994) 1995 SLT 248. 126 1984 JC 23 at 33. 127 2009 SLT 137 at 146 [32]. Crennan Bell supply of a controlled drug to the deceased and, in the other, the act was the injection of the drug at the deceased's request128. In giving the judgment of the High Court of Justiciary, Lord Justice General Hamilton said this129: "We see no reason why the criminal law in Scotland should not, consistently with earlier authority in this jurisdiction, adopt a similar practical, but nonetheless principled, approach. The adult status and the deliberate conduct of a person to whom a controlled drug is recklessly supplied by another will be important, in some cases crucial, factors in determining whether that other's act was or was not, for the purposes of criminal responsibility, a cause of any death which follows upon the ingestion of the drug. But a deliberate decision by the victim of the reckless conduct to ingest the drug will not necessarily break the chain of causation." The references to recklessness in the formulation of the principle are significant. Recklessness, the foundation of culpable homicide in Scots law in cases of this kind, was not "wholly irrelevant" to the causal determination130. The law, it was said, could more readily treat the reckless accused as responsible for consequences in the form of the actions of others "to whom he directs such recklessness"131. Recklessness does not inform unlawful and dangerous act manslaughter in Australia. The Court of Criminal Appeal did not embrace the reasoning of the High Court of Justiciary in this respect. However, it agreed with the conclusion that the voluntary act of an informed and responsible adult taking a prohibited drug might not prevent the anterior act of supply of the drug from being in law the cause of the drug taker's death. This is because132: "Where natural or physical events are being considered a voluntary human act may be the cause of that act. But when that human act is one which 128 MacAngus v HM Advocate 2009 SLT 137 at 139 [6]-[7]. 129 MacAngus v HM Advocate 2009 SLT 137 at 151 [48]. 130 MacAngus v HM Advocate 2009 SLT 137 at 150 [45]. 131 MacAngus v HM Advocate 2009 SLT 137 at 150 [45]. 132 Burns v The Queen (2011) 205 A Crim R 240 at 270 [151]. Crennan Bell follows from the act of another human the position may be otherwise. The more predictable the response the more likely it is that the earlier act will be accepted to have caused, in the relevant sense, the later act." This is in line with Professor Feinberg's theory of causation, which suggests that "the more expectable human behavior is, whether voluntary or not, the less likely it is to 'negative causal connection'"133. It is a theory commended by one commentator as better reflecting the moral dimension of a death occasioned by the supply of an unlawful drug134. The alternative view is that expressions of moral judgment should not intrude into the causal inquiry135. The analysis of the causation of homicide in Royall v The Queen is posited on an acceptance that the voluntary and informed act of an adult negatives causal connection136. Absent intimidation, mistake or other vitiating factor, what an adult of sound mind does is not in law treated as having been caused by another137. The introduction of the concept of the predictable response of the sane adult actor would radically change the rationale for and the nature of the causal inquiry. Neither party invited this Court to endorse that approach. The deceased was a sane adult. It is not suggested that his decision to take the methadone was vitiated by mistake or duress. His ability to reason as to the wisdom of taking methadone is likely to have been affected by the drugs that he had already taken but this is not to deny that his act was voluntary and informed. It was informed because he knew that he was taking methadone. He chose to take methadone not knowing what effect that drug would have in combination with the drugs he had already taken. A foolish decision to take a prohibited drug 133 Feinberg, Doing & Deserving: Essays in the Theory of Responsibility, (1970) at 134 Jones, "Causation, homicide and the supply of drugs", (2006) 26 Legal Studies 139 135 Hart and Honoré, Causation in the Law, 2nd ed (1985) at 403. 136 (1990) 172 CLR 378 at 388 per Mason CJ; 421 per Toohey and Gaudron JJ; 441- 449 per McHugh J; [1991] HCA 27. 137 Hart and Honoré, Causation in the Law, 2nd ed (1985) at 136-138; Williams, Textbook of Criminal Law, 2nd ed (1983) at 391. Crennan Bell not knowing its likely effects is nonetheless the drug taker's voluntary and informed decision. The Crown's concession that the unlawful supply of methadone was not an act capable of founding liability for manslaughter should be accepted. The supply of the methadone was not an act that carried an appreciable risk of serious injury. That risk arose when the drug was consumed. The cause of the death of the deceased in law was the consumption of the methadone and not the anterior act of supply of the drug138. Acceptance of the Crown's concession required that the appeal be allowed. The Crown submitted that the appropriate consequential order was for a new trial at which it should be permitted to present a case on manslaughter by unlawful and dangerous act based on the appellant's alleged complicity in injecting the deceased with methadone. This appeal is not the occasion to consider the responsibility for manslaughter, of a person who assists an adult at the adult's request with the administration of a prohibited drug. Nor is it necessary to consider whether the Crown should be permitted to run a new case relying on a different unlawful act139. This is because the evidence at the trial was not capable of establishing the appellant's complicity in injecting, or assisting to inject, the deceased with the drug. The Court of Criminal Appeal's conclusion to the contrary was based upon a misunderstanding of a concession made by the appellant. The Court of Criminal Appeal relied on the following evidence as having established the appellant's complicity in injecting the deceased with the methadone. Dr Duflou considered that a puncture mark on the deceased's left elbow had been made eight to 12 hours prior to death. This circumstance pointed to the methadone as having been taken by injection. The deceased was not an experienced methadone user. Injecting methadone requires considerable skill140. The appellant's remark that the deceased "got the best outfit, no more" suggested that she had seen the syringe that had been used141. The Court went on to say142: 138 Royall v The Queen (1990) 172 CLR 378 at 445 per McHugh J; R v Kennedy (No 2) [2008] AC 269 at 274 [7]. 139 Cf R v Taufahema (2007) 228 CLR 232; [2007] HCA 11. 140 Burns v The Queen (2011) 205 A Crim R 240 at 272 [157]. 141 Burns v The Queen (2011) 205 A Crim R 240 at 272 [159]. Crennan Bell "In our opinion the evidence made it entirely unlikely that the victim injected the methadone. It was open to the jury to conclude to the relevant standard, as we would ourselves, that the appellant or Burns administered the injection. The appellant accepted that they were acting in concert. The act of injection was unlawful and in the circumstances plainly dangerous and tragically led to the deceased's death." (emphasis added) The Court of Criminal Appeal had earlier, correctly, recorded the appellant's concession that it had been open to the jury to find that she was a party to a joint enterprise with Brian Burns to supply methadone to the deceased143. However, contrary to the tenor of the Court's statement extracted above, the appellant's concession was not that she was complicit in administering the drug. There was no direct evidence of how the deceased consumed the methadone. The recent puncture mark provided a basis for inferring that the drug had been injected. However, the evidence supporting the conclusion that the deceased did not inject himself with the drug is less satisfactory. The suggestion that the deceased was not an experienced methadone user was based on the history that he supplied to Dr Roberts and his general practitioner and the fact that he was not a registered methadone user. All that is known of the deceased as an historian is that he gave a false account to Dr Roberts of the drugs that he had taken on 9 February 2007. He did not disclose that he had taken an excessive quantity of Zyprexa, which Dr Roberts had prescribed. Instead, he attributed his drowsy state to having taken Endone. Yet no Endone was detected in the blood and tissue samples that were analysed post-mortem. A second, older, puncture mark on the crook of the deceased's left elbow, might suggest that he was not an inexperienced injecting drug user. It was not open to exclude as a reasonable possibility that the deceased injected himself with the methadone. Moreover, when Ms Malouf arrived, the deceased was in the living room with Brian Burns. The appellant was in another part of the unit. Brian Burns' statement to the effect that the deceased had taken methadone supported an inference that he was present when that occurred. There was no basis for the further inference that the appellant was acting in concert with Brian Burns with respect to any assistance he may have given to the deceased to take the drug. 142 Burns v The Queen (2011) 205 A Crim R 240 at 272-273 [160]. 143 Burns v The Queen (2011) 205 A Crim R 240 at 266 [131]. Crennan Bell The prosecution sought and obtained leave to cross-examine Ms Malouf on aspects of her account. Notably, there was no challenge to her evidence that the appellant had not been present in the living room of the premises when she arrived. The appellant's involvement with Brian Burns in inciting Ms Malouf to tell lies to the police in the course of the investigation was capable of supporting the inference that the appellant was complicit in the supply of methadone to the deceased. It was not capable of supporting the further inference that the appellant had injected, or assisted Brian Burns to inject, the deceased with the drug. For these reasons there was no order for a new trial upon an allegation of manslaughter by unlawful and dangerous act. The next consideration was whether there should be an order for a new trial confined to the case of manslaughter by gross negligence. Manslaughter by gross negligence Criminal liability does not fasten on the omission to act, save in the case of an omission to do something that a person is under a legal obligation to do144. As a general proposition, the law does not impose an obligation on individuals to rescue or otherwise to act to preserve human life145. Such an obligation may be imposed by statute or contract or because of the relationship between individuals. The relationships of parent and child, and doctor and patient, are recognised as imposing a duty of this kind. A person may voluntarily assume an obligation to care for a helpless person and thereby become subject to such a duty146. Outside 144 Director of Public Prosecutions (Cth) v Poniatowska (2011) 244 CLR 408 at 421 [29]; [2011] HCA 43. 145 Stephen, A Digest of the Criminal Law, (1877), c 22 at 133-135. 146 R v Stone and Dobinson [1977] QB 354; R v Taktak (1988) 14 NSWLR 226; R v Sinclair, Johnson and Smith unreported, England and Wales Court of Appeal (Criminal Division), 21 August 1998. See also Jones v United States of America 308 F 2d 307 at 310 (1962); People v Beardsley 113 NW 1128 (1907). Crennan Bell limited exceptions, a person remains at liberty in law to refuse to hold out her hand to the person drowning in the shallow pool147. The appellant had no relationship with the deceased beyond that of acquaintance. He called at her home to purchase prohibited drugs. He took the drugs in her home and suffered an adverse reaction to them in her presence. He left her home at her request while in a compromised state. He died within hours as the result of the combined effect of the drug supplied by the appellant and drugs that he had earlier taken. In question is the source of the legal duty which obliged the appellant to obtain medical assistance for the deceased and how her failure to do so can be said to have been a cause of his death. The trial judge gave these directions as to the existence and scope of any duty: "If a person voluntarily invites or permits potential recipients to attend his or her home for the purpose of a prohibited drug supply transaction where the drugs are to be consumed on the premises, and where such a recipient may be or become seriously affected by drugs to the point where his or her life may be endangered, the drug supplier has a duty to conduct himself toward the drug recipient without being grossly or criminally neglectful." In the event that the jury were satisfied that the appellant had "voluntarily take[n] upon herself such a duty", her failure to call an ambulance or obtain other medical assistance for the deceased and her conduct in expelling him from the unit when he was in a "grossly vulnerable condition" were the matters identified as capable of amounting to a criminally negligent breach of duty. The appellant was not in a relationship with the deceased which the law recognises as imposing an obligation to act to preserve life. She had not voluntarily assumed the care of the deceased nor had she secluded him such as to deny him the opportunity that others would assist him. Different considerations may have applied in the trial of Brian Burns. At the appellant’s trial, the Crown accepted that she had not been subject to any obligation to seek medical attention for the deceased after he left the unit in company with Brian Burns. 147 Stephen, A Digest of the Criminal Law, (1877), c 22 at 135. Crennan Bell Although the trial judge directed the jury to consider whether the appellant had voluntarily assumed a duty of care to the deceased, this was not the foundation for the duty which the Court of Criminal Appeal identified. It considered that the appellant had come under a duty of the kind found by the English Court of Appeal in R v Evans (Gemma)148. Gemma Evans supplied her 16 year old half-sister, Carly, with heroin. After Carly exhibited signs of opiate overdose, Gemma failed to seek medical assistance for her. The English Court considered that Gemma had been under "a plain and obvious duty to take reasonable steps to assist or provide assistance for Carly"149. The duty did not arise because of the sibling relationship, but because Gemma had "created or contributed to the creation of a state of affairs" which she knew, or ought reasonably to have known, had become life threatening 150. This is a duty of a kind identified by the House of Lords in R v Miller151. In Miller, the accused was found to be criminally responsible for his failure to take reasonable steps to prevent a house fire. Miller was squatting in the house. He fell asleep holding a lighted cigarette and woke to find the mattress on fire. He got up and moved to the adjacent room and went back to sleep. The house was damaged by the fire which had been ignited by the lighted cigarette. Following Miller's conviction for arson, the question certified for the House of Lords was whether the accidental starting of a fire could be the actus reus of arson in circumstances in which the accused had subsequently failed to take steps to extinguish it, either intending to cause damage to property or being reckless as to that consequence152. Miller's conviction was upheld. In giving the judgment of the House of Lords, Lord Diplock said153: "I see no rational ground for excluding from conduct capable of giving rise to criminal liability, conduct which consists of failing to take 148 [2009] 1 WLR 1999; [2010] 1 All ER 13. 149 R v Evans (Gemma) [2009] 1 WLR 1999 at 2012 [49]; [2010] 1 All ER 13 at 25. 150 R v Evans (Gemma) [2009] 1 WLR 1999 at 2007 [31]; [2010] 1 All ER 13 at 21. 152 R v Miller [1983] 2 AC 161 at 174. 153 R v Miller [1983] 2 AC 161 at 176. Crennan Bell measures that lie within one's power to counteract a danger that one has oneself created … I cannot see any good reason why, so far as liability under criminal law is concerned, it should matter at what point of time before the resultant damage is complete a person becomes aware that he has done a physical act which, whether or not he appreciated that it would at the time when he did it, does in fact create a risk that property of another will be damaged; provided that, at the moment of awareness, it lies within his power to take steps, either himself or by calling for the assistance of the fire brigade if this be necessary, to prevent or minimise the damage to the property at risk." Sir John Smith has suggested that Miller is an example of a general principle, which he stated in these terms154: "[W]henever the defendant's act, though without his knowledge, imperils the person, liberty or property of another, or any other interest protected by the criminal law, and the defendant becomes aware of the events creating the peril, he has a duty to take reasonable steps to prevent the peril from resulting in the harm in question." Whether this is a statement of the common law of Australia is not an issue presented by this appeal. Miller's criminal responsibility, analysed in terms of a duty to take steps to extinguish the fire155, arose because it was his act that imperiled the property. By contrast, here, as earlier explained, the imperilment of the deceased was the result of his act in taking the methadone. Lord Diplock commented in Miller on the difficulty of defining those who are to be made subject to criminal liability for being bad Samaritans156. Why is the appellant liable for the manslaughter of the deceased when Ms Malouf is not? It cannot be because the law imposes a general duty on suppliers of prohibited drugs to take reasonable steps to preserve the life of their customers. The supply 154 J C Smith, "Liability for omissions in the criminal law", (1984) 4 Legal Studies 88 155 An alternative analysis of Miller's criminal responsibility recognised by the House of Lords was by way of "continuing act": R v Miller [1983] 2 AC 161 at 178-179. 156 [1983] 2 AC 161 at 175. Crennan Bell of prohibited drugs is visited by severe criminal punishment in recognition of the harm associated with their use. The notion that at the same time the law might seek to regulate the relationship between supplier and user, by imposing a duty on the former to take reasonable care for latter, is incongruous. What measures would reasonable care require? Should suppliers of prohibited drugs be required to supply clean needles and accurate information about safe levels of use? The duty that the Court of Criminal Appeal found the appellant to be under was not a general duty of this kind. It accepted the submission that a duty is imposed on the supplier of a prohibited drug in circumstances in which the drug is taken in the supplier's presence157. The rationale for that duty is not that the supplier has contributed to the endangerment of the user. Contribution to this state of affairs occurs at the point of supply, when, ordinarily, the supplier will have no control over whether and in what quantities the drug will be consumed. The duty that the Court of Criminal Appeal identified arose because, as it happened, the appellant was present when the deceased suffered the adverse reaction to the drug she had supplied. It is difficult to resist the conclusion that the duty is being imposed in these circumstances because it is an affront to morality that the supplier of a prohibited drug should not bear responsibility for the callous disregard for the life of the drug user. However, courts must be circumspect in identifying categories of relations that give rise to a previously unrecognised legal obligation to act158. The relationship of supplier of prohibited drugs and recipient does not lend itself to the imposition of such a duty. Apart from considerations of incongruity, there is absent the element of control which is found in those relationships in which the law imposes a duty on a person to act to preserve life. It is open to the legislature to criminalise the failure of the supplier of a prohibited drug to take reasonable steps to provide medical assistance to the drug user. This might be done by making the failure to act itself an offence or by liability for imposing a statutory duty on manslaughter in the case of gross breach. Difficult policy choices may be involved in the decision to enact an offence of either kind. The desirability of the supplier with attendant 157 Burns v The Queen (2011) 205 A Crim R 240 at 260-263 [105]-[114]. 158 See, eg, R v Sinclair, Johnson and Smith unreported, England and Wales Court of Appeal (Criminal Division), 21 August 1998; B Hogan, "Omissions and the duty myth", in Smith (ed), Criminal Law: Essays in Honour of J C Smith, (1987) 85 at Crennan Bell making drug suppliers responsible for the deaths of drug users is one objective to which reference has been made earlier in these reasons. Another objective may be to minimise the incidence of fatal drug overdoses. Exposing the supplier to the risk of conviction for manslaughter (or other serious offence) when the user dies of an overdose at the supplier's premises, while advancing the former objective, may not necessarily promote the latter. The development of the law along the lines urged by the Crown is a matter for the legislature and not the courts. This conclusion made it unnecessary to address the parties' submissions respecting causation on the case in criminal negligence. It is sufficient to note that the circumstance that the deceased was capable of leaving and did leave the unit after evincing his disinclination for medical assistance presents a formidable obstacle to proof that the appellant's failure to call an ambulance was a cause of his death. 110 HEYDON J. There were three possible ways in which the appellant might have been convicted of manslaughter. Three possible routes to a manslaughter conviction The first possible route to a manslaughter conviction was that the appellant's supply of methadone to the deceased was an unlawful and dangerous act that caused his death. The second possible route to a manslaughter conviction was that the appellant's administration of methadone to the deceased, or her assistance to him in an act of self-administration, was an unlawful and dangerous act that caused his death. One distinction between this route and the first is that the first concentrates on supply short of administration, while the second concentrates on administration as distinct from supply. The third possible route to a manslaughter conviction was that the appellant's failure to seek medical attention for the deceased was a grossly negligent omission that caused his death. The appellant's supply of methadone to the deceased The written submissions of the respondent in this Court did not contend that this was an available route to a manslaughter conviction. Those submissions were directed to establishing a claim that either the second or third routes to a manslaughter conviction were available. The oral submissions of the respondent in this Court maintained that it had not relied on this first route at the trial. Strictly speaking, that is not correct. This first route and the third route were advocated in the opening prosecution address. The prosecution opening address said: "The bases of the charge that she allegedly killed [the deceased] is that in a joint enterprise with her husband … that they supplied the drug, methadone, which is an unlawful act, knowing that [the deceased] would take on board either by injection or orally and that for [the deceased], that was a dangerous thing to do, it was a dangerous action. That is the supply of the drug to [the deceased]. The second basis of the charge of manslaughter is that [the appellant] breached the duty of care that she owed to [the deceased] because she failed to render assistance or ask for assistance when [the deceased] was in need of some help and in fact that she insisted that [the deceased] leave her apartment that afternoon." However, in oral argument before this Court the respondent specifically conceded that "the supply by itself cannot substantiate the … unlawful and dangerous act, that it requires the further activity of ingesting the drug." That concession was never retracted or qualified. The concession rests on a fine distinction. If V says to A: "Give me a dose of methadone and injecting equipment; I want to inject myself with it right now", A does so, V injects himself unassisted, and V then dies, on the respondent's concession A is not guilty of manslaughter. But if V says to A: "Give me a dose of methadone and help me inject myself with it", V does so and then dies, A may be guilty of manslaughter. Is that distinction sound? That is a difficult legal question. Resolving it would involve investigation of, among other things, the meaning in this context of expressions like "fully informed", "responsible", "volitional", "free", "deliberate" and "mistake". The concession having been made, neither the appellant nor the respondent was concerned to dispute it. In the absence of a contradictor, it is not satisfactory for courts to endeavour to solve difficult legal problems which need not be resolved in order to protect the accused's interests in the particular case in which they arise. On that unadventurous ground, the concession has to be accepted. It is impossible to say whether the jury or any member of it convicted the appellant because of a belief in what the concession now accepts as wrong. The appeal must therefore be allowed. It remains to be decided whether there should be a new trial. That question depends on whether there is evidence, taken at its highest, on which a jury could convict the appellant of manslaughter under either the second or third routes set out above. The appellant's administration of methadone to the deceased Whether the appellant's administration of methadone to the deceased, or her assisting in self-administration by the deceased, could render her guilty of manslaughter depended on what the evidence of that administration or assistance was, and what could be inferred from it, taken at its highest. In the prosecution's final address the following evidence was relied on to support the inference that the appellant was involved in injecting the deceased or helping him to inject himself. First, methadone is so viscous that it could not have been injected unless it had been watered down. Secondly, the watering down process makes the volume of methadone to be injected by a drug user very substantial. Thirdly, this substantial volume of methadone would have made it necessary to employ a "butterfly syringe" – a syringe with a big barrel held stable by a butterfly clip. This kind of apparatus operates more like a slow drip than a speedy injection. Fourthly, there were butterfly syringes in the appellant's flat. Fifthly, the appellant knew that a butterfly syringe had been employed to inject the methadone into the deceased. Covert telephone recordings made by the police recorded her as saying that the deceased had "got the best outfit" – ie, a butterfly syringe. At the least, that demonstrated that she had observed the equipment with which the deceased had been injected. Sixthly, the deceased was not an experienced methadone user. Dr Roberts, the deceased's psychiatrist, regarded him as being "narcotically naive". By that, Dr Roberts meant that the deceased had not been exposed to circumstances in which he would develop tolerance to drug doses. The fact that the deceased was narcotically naive supports an inference that it was inherently dangerous for him to be injected with methadone. It also supports an inference that he would have had difficulty employing a butterfly syringe to inject himself. Seventhly, Dr Duflou, a medical examiner, observed injury to the veins under the surface of the crook of the deceased's left elbow within hours of the deceased's death. The location of the injury was a location suitable for, and commonly used for, injecting methadone. Dr Duflou thought that the injury indicated a very fine needle puncture mark. He thought that it would have been made 8 to 12 hours prior to death. Apart from a blood clot in a blood vessel which had been present "for many days, possibly weeks", there was no other evidence of injection. There are at least three other pieces of evidence on which the prosecution's final address did not appear to rely. One is that no syringe was found near the deceased's body. Another is that the appellant revealed concern about the police searching her flat and finding butterfly syringes. And another is that on 3 March 2007, in a telephone conversation which the police covertly recorded, the appellant endeavoured to persuade Felicity Malouf to give a false account to the police of the events that took place in the appellant's flat before the deceased left on his way to die. The Court of Criminal Appeal found that159: "[Felicity Malouf] was to say that she arrived at the unit first and later the deceased arrived drunk. He said he did not want an ambulance and the appellant told him to leave. [Mr] Burns walked the deceased outside and Ms Malouf stayed another half an hour." The evidence supporting that finding was as follows. Felicity Malouf said: "Now are you supposed to have been asleep in bed when I arrived or?" The appellant responded: "Well, no, it doesn't matter, no I was here … I was here, we were both here, you came over … and you were here I was here OK. I was here, you came over, you were here … you were here then he come over." On the same day, Felicity Malouf gave a statement to the police along those lines. The account which the appellant asked Felicity Malouf to give to the police was the account which she herself gave to the police. The appellant spoke to the police on the same day, 3 March 2007. In her evidence in chief, Felicity Malouf admitted that the account which she gave to the police was false. In 159 Burns v The Queen (2011) 205 A Crim R 240 at 248 [23]. truth, the deceased was already at the appellant's flat when Felicity Malouf arrived. The appellant's discussions with Felicity Malouf were evidence capable of supporting an inference that the appellant knew that if Felicity Malouf was permitted to tell the truth to the police, it would have increased the strength of any available inference that the appellant had either injected the drug into the deceased, or helped him to inject himself. Felicity Malouf had not seen this happen. If there were evidence that she was at the appellant's flat the whole time that the deceased was there, that evidence would leave no interval of time available within which the appellant could have injected the deceased or helped him to inject himself. That evidence would completely exculpate the appellant of participating in an injection. The lie was designed to avoid the risk that the exculpatory effect of Felicity Malouf's evidence might operate over too short a period of time to be useful to her defence. The appellant was seeking to give herself a kind of alibi. She could not call evidence to say that she was not in her flat while the deceased was there. But the appellant tried to create a state of affairs in which a witness who was supposedly in the flat for the entire period relevant to the offence had seen no misconduct on her part. At the time when the accused was not generally a competent witness, Cockburn CJ said160: "[A] prisoner's making a false statement to increase his appearance of innocence is [not] necessarily a proof of his guilt; but it is always evidence which ought to be submitted to the consideration of the tribunal which has to judge of the facts". The same is true of an attempt by an accused person to persuade someone else to make a statement to increase the appearance of the accused person's innocence. There are possible arguments to put against the admissibility of this evidence. But their success is far from certain161. Those arguments would point out that some parts of the recorded conversations may be explicable as reflecting a consciousness of guilt concerning the illegal supply of drugs, not manslaughter. Thus they disclose the fears of the appellant about the police searching the flat. They disclose a discussion about the disposal of syringes and methadone. They disclose discussions about the importance of people not taking methadone in the apartment. But the conversations revealed a consciousness on the part of the appellant that she was guilty of more than just illegal drug supply. Assessing her consciousness of guilt depends on looking at all the circumstantial evidence together. There were discussions about the importance of not supplying methadone to people who were apparently under the influence of another drug. The appellant repeatedly and obsessively referred to the death of the deceased. And the appellant said to her husband about the deceased's death: "This is murder". If that death was capable of being seen as the form of unlawful homicide known as "murder", it was capable of being seen as that form of 160 Moriarty v London, Chatham and Dover Railway Co (1870) LR 5 QB 314 at 319. See also R v Farquharson (2009) 26 VR 410 at 454 [174]. 161 Cf Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63. unlawful homicide known as "manslaughter". The appellant now denies that the mere supply of methadone was manslaughter, and enthusiastically endorses the respondent's concession to that effect. The appellant also now denies that her failure to give assistance to the deceased was manslaughter, and this Court agrees. What else did the appellant mean by "murder"? All that is left is manslaughter by injecting the deceased or helping him to inject himself. It is true that at a new trial it would be open to the defence to attack or weaken the effect of the pieces of evidence just summarised. For example, Dr Robert's opinion could be attacked. Dr Roberts based his opinion that the deceased was narcotically naive on the history which the deceased had given him, and he attributed the deceased's drowsy state to having taken Endone. That was the explanation the deceased gave for the drowsiness which Dr Roberts noticed. The cross-examiner informed Dr Roberts that he anticipated that there would be testimony that after an autopsy of the deceased, blood and urine samples were taken, and they showed that there was no Endone to be found in the deceased's system. The cross-examiner asked Dr Roberts to "assume that that finding of there being no [E]ndone in [the deceased's] system meant that when he told you that he had taken [E]ndone it was a lie." The question continued: "Is it possible that when you described [the deceased] as being narcotically naive, that might well not be the case at all?" The answer was: "In describing him as narcotically naive, I was basing that statement on what he had told me and what he had told others." The next question and answer but one was: "Q. If he is lying to you about [E]ndone, there is no means other than what it is that [the deceased] told you, there is no means of you knowing whether he's narcotically naive or not? A. That is correct." And in re-examination the following question and answer appear: "Q. Was there anything in the way you observed [the deceased] or related to him or he to you that gave you any cause for thought or doubt about his use of narcotics – The next witness was John Andrew Farrar, a pharmacologist. It was his testimony to which the cross-examiner had referred. However, he did not assert in an unqualified way that the deceased had not taken Endone. He said that, according to an analyst's report, a screening process applied to a blood sample from the deceased had failed to find Endone. He continued: "[o]n that basis I believe that … Endone … was not present in the blood sample of the deceased at the time that he died and I don't believe that there was any or certainly enough of that material to cause [the deceased] to be 'on the nod' at the time he was visiting Dr Roberts." The assumption put to Dr Roberts on the strength of which he accepted the possibility of the deceased having lied to him did not correspond precisely or completely with the evidence which the cross-examiner had indicated would be given. The evidence that the deceased was narcotically naive could also be attacked in another way. The blood clot Dr Duflou found suggested that at least once in the previous weeks or days the deceased had received or given himself a drug injection. But it does not follow that the deceased was experienced in the administration of methadone, let alone sufficiently experienced to inject himself with a large volume of diluted methadone. Further, the defence could, at a new trial, seek to weaken the evidence summarised above by pointing out that it was the appellant's husband who, in the appellant's absence, told Felicity Malouf that the deceased had taken methadone. But that fact does not negate the possibility that the appellant had injected methadone into the deceased or assisted the deceased in injecting himself before Felicity Malouf arrived. The question is not whether there is evidence which is so strong that at a second trial it would establish the appellant's guilt beyond reasonable doubt. The question is not whether there is evidence which at a second trial would exclude all reasonable possibility of an acquittal. The question is whether there is evidence which, taken at its highest, could establish the appellant's guilt beyond a reasonable doubt at a second trial, even though there may be other views of that evidence and even though other evidence may undermine or contradict it. On that basis, there is evidence on which the appellant could be convicted of unlawful and dangerous act manslaughter at a second trial. Failure to seek medical attention An omission to act where the act would have saved the life of another can be manslaughter. But omissions of this kind fall within confined categories. Those categories require particular kinds of relationship between the deceased and the accused. The relationship between the deceased and the appellant was insufficiently close to the accepted categories to justify its recognition as one of them. To extend those categories would be to change the criminal law retrospectively. In 1879, Lord Blackburn, Mr Justice Barry, Mr Justice Lush and Sir James Fitzjames Stephen sat as a Royal Commission and issued a report annexing a Draft Code of Criminal Law162. The report dealt with what it saw as a fallacious attribution of "discretion" to judges deciding new cases163: "It seems to be assumed that when a judge is called on to deal with a new combination of circumstances, he is at liberty to decide according to his own views of justice and expediency; whereas on the contrary he is bound to decide in accordance with principles already established, which he can neither disregard nor alter, whether they are to be found in previous judicial decisions or in books of recognized authority. The consequences of this are, first, that the elasticity of the common law is much smaller than it is often supposed to be; and secondly, that so far as a Code represents the effect of decided cases and established principles, it takes from the judges nothing which they possess at present. For example, it never could be suggested that a judge in this country has any discretion at the present day in determining what ingredients constitute the crime of murder, or what principles should be applied in dealing with such a charge under any possible state of circumstances: and yet the common law definition of murder has in its application received a remarkable amount of artificial interpretation. The same observation is applicable to every other known offence." It is certainly applicable to the offence of manslaughter. To create a new category of omissions carrying responsibility for the crime of manslaughter would alter the ingredients of that crime. On 20 October 1897, Sir Samuel Griffith wrote to the Attorney-General of Queensland enclosing his Draft Code of Criminal Law. In that letter, he referred to the Royal Commission's report. The Royal Commission's report proposed that all offences be prosecuted under the Code or some other statute only, not at common law. Sir Samuel quoted it as saying164: 162 United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences, (1879) [C 2345]. 163 United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences, (1879) [C 2345] at 7-8. 164 Griffith, Draft of a Code of Criminal Law, (1897) at vi. See United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences, (1879) [C 2345] at 9. "The result of this provision would be to put an end to a power attributed to the judges, in virtue of which they have (it has been said) declared acts to be offences at Common Law, although no such declaration was ever made before. And it is, indeed, the withdrawal of this supposed power of the judge to which the argument of want of elasticity is mainly addressed." Sir Samuel also quoted the following words165: "In bygone ages when legislation was scanty and rare, the powers referred to may have been useful and even necessary; but that is not the case at the present day. Parliament is regular in its sittings and active in its labours; and if the protection of society requires the enactment of additional penal laws Parliament will soon supply them. If Parliament is not disposed to provide punishment for acts which are upon any ground objectionable or dangerous, the presumption is that they belong to that class of misconduct against which the moral feeling and good sense of the community are the best protection. Besides, there is every reason to believe that the Criminal Law is, and for a considerable time has been, sufficiently developed to provide all the protection for the public peace and for the property and persons of individuals, which they are likely to require under almost any circumstances which can be imagined; and this is an additional reason why its further development ought, in our opinion, to be left in the hands of Parliament." It is plain that Sir Samuel agreed with these ideas. The "moral feeling" of the community would probably be strongly hostile to the appellant's conduct in not summoning medical aid for the deceased. But that is no reason for a retrospective change in the criminal law to be made by this Court. Orders There should not be a new trial in relation to the first route towards a manslaughter conviction. The respondent does not seek this. In any event, there is no reason to depart from the respondent's concession. Nor should there be a new trial in relation to the third route because to treat the appellant's failure to summon medical aid for the deceased as a criminal omission would involve a retrospective change in the criminal law. But there is no reason why there should not be a new trial in relation to the second route towards a manslaughter conviction. 165 Griffith, Draft of a Code of Criminal Law, (1897) at vi. See United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences, (1879) [C 2345] at 9-10. Is an order for a new trial barred because the prosecution would be running a case of unlawful and dangerous act manslaughter at the new trial which was based on an unlawful and dangerous act that was different from the act on which it relied at the first trial? At the original trial, the prosecution case did at times exhibit confusion between the unlawful and dangerous act of supplying methadone and the unlawful and dangerous act of administering it. But at least by the time of the no case submission, the prosecution was alleging that the appellant had done the latter type of unlawful act. And in the prosecution's final address, it pressed the latter type of unlawful act. A case based on the latter type of unlawful act was open on the evidence called by the prosecution. A new trial run based on the second route to a manslaughter conviction would not be one raising a new case, but a narrower version of the old case. For those reasons I disagree with the orders pronounced on 20 June 2012. There should have been an order for a new trial, limited as described.
HIGH COURT OF AUSTRALIA APPELLANTS AND AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED RESPONDENT Paciocco v Australia and New Zealand Banking Group Limited [2016] HCA 28 27 July 2016 M219/2015 & M220/2015 ORDER Matter No M219/2015 Appeal dismissed with costs. Matter No M220/2015 Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation D F Jackson QC with M B J Lee SC and W A D Edwards for the appellants (instructed by Maurice Blackburn) A C Archibald QC and M H O'Bryan QC with C van Proctor for the respondent (instructed by Ashurst Australia) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Paciocco v Australia and New Zealand Banking Group Limited Banker and customer – Rule against penalties – Consumer credit card accounts – Late payment fees – Where late payment fees were $35 and $20 – Where costs actually incurred by respondent upon failure by first appellant to make timeous payment of amounts owing were approximately $3 – Where late payment fees not genuine pre-estimates of damage – Where respondent alleged it could conceivably have incurred loss provision costs, collection costs and regulatory capital costs as a result of first appellant's default – Whether late payment fees penalties – Whether fees extravagant, exorbitant or unconscionable – Whether late payment fees out of all proportion to interests damaged – Whether respondent's legitimate interests confined to reimbursement of expenses directly occasioned by first appellant's default. late payment Contract – Rule against penalties – Essential characteristics of a penalty – Whether sum disproportionate to actual loss suffered amounts to a penalty – Whether sum incorporating loss too remote to be recoverable in action for damages amounts to a penalty – Relevance of Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79. Trade practices – Consumer protection – Late payment fees – Unconscionable conduct – Unjust transactions – Unfair terms – Whether late payment fees unconscionable, unjust or unfair. Precedent – Apex courts of foreign jurisdictions – Status of unwritten law of United Kingdom in Australia. Words and phrases – "exorbitant", "extravagant", "genuine pre-estimate", "in terrorem", "late payment fees", "liquidated damages", "out of all proportion", "penalty", "unconscionable", "unconscionable conduct", "unfair terms", "unjust transactions". Australian Securities and Investments Commission Act 2001 (Cth), ss 12BF, 12BG, 12CB, 12CC. National Consumer Credit Protection Act 2009 (Cth), Sched 1 s 76. Fair Trading Act 1999 (Vic), ss 8, 8A, 32W, 32X. FRENCH CJ. These appeals concern the enforceability of late payment fee provisions in contracts between the first appellant and the respondent bank in relation to consumer credit card accounts. The terms of the impugned provisions are set out in the reasons for judgment of Nettle J1. Broadly speaking they required the cardholder, following receipt of a monthly statement of account, to make the "Minimum Repayment" set out on each statement by the due date shown on it. A "Late Payment Fee" was to be charged to the credit card account if the minimum monthly payment, plus any "Amount Due Immediately" shown on the statement of account, was not paid by a specified date. The first appellant, Lucio Paciocco ("Mr Paciocco"), held consumer credit card and deposit accounts with the respondent, Australia and New Zealand Banking Group Limited ("the Bank"). The second appellant, Speedy Development Group Pty Ltd, is a company controlled by Mr Paciocco. It held a business deposit account with the Bank. All of the accounts were charged various fees by the Bank. The consumer and business deposit accounts were charged honour fees, dishonour fees and non-payment fees. The consumer credit card accounts held by Mr Paciocco were charged over-limit fees and late payment fees. Both appellants were applicants in representative proceedings against the Bank under Pt IVA of the Federal Court of Australia Act 1976 (Cth). The appellants alleged that the provisions for the various fees were unenforceable as penalties and, alternatively, that their inclusion contravened various statutory provisions relating to unconscionable conduct2 and, with respect to Mr Paciocco only, unjust3 and unfair contract terms4. The primary judge, Gordon J, found that the provisions for the late payment fees were penalties at common law and in equity. It was therefore not necessary for her Honour to deal with the statutory claims regarding the late payment fees. Her Honour held that none of the other fees constituted a penalty, nor contravened any of the identified statutory provisions5. On appeal, the Full Court of the Federal Court held that the late payment fees were not penalties and did not fall within any of the statutory categories of unconscionable conduct, unjustness or unfairness. The Full Court 2 Australian Securities and Investments Commission Act 2001 (Cth), ss 12CB and 12CC; Fair Trading Act 1999 (Vic), ss 8 and 8A. 3 National Credit Code, contained in National Consumer Credit Protection Act 2009 (Cth), Sched 1. 4 Fair Trading Act 1999 (Vic), s 32W; Australian Securities and Investments Commission Act 2001 (Cth), s 12BG. 5 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249. upheld the primary judge's findings with respect to the other fees6. That conclusion is not challenged in these appeals. These appeals, by grant of special leave from the Full Court's decision, are concerned only with the correctness of that decision in respect of the late payment fees. The facts relevant to the appeals and the evidence of contending expert witnesses at trial are set out in the judgment of Gageler J and it is unnecessary to repeat them here. For the reasons given by Kiefel J and, in relation to the statutory claims, for the reasons given by Keane J, I agree that the appeals to this Court should be dismissed. I will, however, add some comments to that concurrence. The question whether various fees charged by the Bank to its credit card customers were unenforceable as penalties was raised in an earlier representative proceeding before Gordon J, sub nom Andrews v Australia and New Zealand Banking Group Ltd. An application for leave to appeal from an interlocutory decision of Gordon J in those proceedings7, to the Full Court of the Federal Court, was removed into this Court pursuant to s 40(2) of the Judiciary Act 1903 (Cth). The interlocutory decision responded to separate questions asked by the applicants in that case. They included questions whether honour, dishonour, non-payment and over-limit fees, and the late payment fees in issue in these appeals, were payable on breach of the relevant contract by the customer, or upon the occurrence of events amounting to a default under the contract which the customer had an obligation to avoid, and whether they were capable of being characterised as penalties by reason of either of those facts8. The framing of those questions required consideration of whether the unwritten law making penalties unenforceable was limited to cases in which the putative penalty was enlivened by a breach of contract. The primary judge held that the rule against penalties was limited to penalties arising out of breach of contract, that only the late payment fees were payable upon breach, and that the rule could therefore only be applied to those fees. In so doing, her Honour properly followed the decision of the Court of Appeal of the Supreme Court of New South Wales in Interstar Wholesale Finance Pty Ltd v Integral Home Loans Pty Ltd9. This Court, on the removed application for leave to appeal from her Honour's interlocutory decision, granted leave to appeal and allowed the appeal. The Court held that equitable relief against penalties had not been subsumed into 6 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199. 7 Andrews v Australia and New Zealand Banking Group Ltd (2011) 211 FCR 53. 8 Andrews v Australia and New Zealand Banking Group Ltd (2011) 211 FCR 53 at (2008) 257 ALR 292. the common law rule and that the rule against penalties was not limited to cases arising out of a breach of contract10. Subsequently, the present appellants commenced these proceedings, which were also heard before Gordon J as the primary judge. In Andrews, the Bank did not seek to appeal against her Honour's finding in her interlocutory decision about how the alleged penalty provision with respect to late payment fees operated11. There was no attempt to argue in this Court that the penalty provisions in the consumer credit card accounts to which Mr Paciocco was a party operated any differently12. This case thus came to this Court as one involving characterisation of a provision for payment of a fee which was, if enforceable, enlivened upon a breach of contract. As Gageler J points out, the decision in Andrews and that of the House of Lords in Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd13 set out the governing principles so far as they apply to penalties for breach of contract14. A difference has emerged since the decision in Andrews between the Supreme Court of the United Kingdom and this Court in relation to the scope of the law relating to penalties. It is not necessary to reflect upon the merits of the different positions as the present appeal on the penalty question falls within essentially undisputed territory. It is, however, desirable to say something about the fact of divergence between our jurisdictions, which have an historical connection that Australia does not have with any other jurisdiction. In Cavendish Square Holding BV v Makdessi15, Lord Neuberger of Abbotsbury PSC and Lord Sumption JSC (with whom Lord Carnwath JSC 10 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205; [2012] HCA 30. 11 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 at 12 The primary judge, consistently with her finding in Andrews, rejected the Bank's "formal" submission that the late payment fees were not payable on breach: Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 278-279 [113]-[114], 291 [180]-[181], 302 [239]. The Full Court rejected the Bank's submission challenging that conclusion: Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 231-232 [82]-[89] per Allsop CJ, Besanko and Middleton JJ agreeing at 289 [371], 295 [398]. 15 [2015] 3 WLR 1373; [2016] 2 All ER 519. agreed) held that the rule against penalties was confined to cases arising out of contractual breach. Their disagreement with the scope of the law as stated in Andrews was emphatic, describing the decision as "a radical departure from the previous understanding of the law"16. Their Lordships' language echoed that of Menzies J in this Court half a century earlier in Uren v John Fairfax & Sons Pty Ltd17 when he declared the limitation on recovery of exemplary damages prescribed by Lord Devlin in Rookes v Barnard18 to be "a radical departure from what has been regarded as established law." It is not necessary for present purposes to engage with that characterisation of Andrews19. Gageler J expresses the view that it was incorrect and based upon a misunderstanding of the scope of what was actually decided in Andrews20. In any event, emphatic disagreement between our jurisdictions in relation to the common law and equitable doctrines, while infrequent, is not novel. The countries of the common law world have a shared heritage which they owe to the unwritten law of the United Kingdom. That shared heritage offers the undoubted advantage, but does not import the necessity, of development proceeding on similar lines21. It is more than half a century since Dixon CJ said that this Court would no longer adhere to the policy that it ought to follow the decisions of the House of Lords at the expense of its own opinions. That change of direction was occasioned by the judgment of the House of Lords in Director of Public 16 [2015] 3 WLR 1373 at 1396 [41]; [2016] 2 All ER 519 at 541. 17 (1966) 117 CLR 118 at 145; [1966] HCA 40. See also at 160 per Owen J. 19 The scope of the rule against penalties beyond cases of breach of contract does not arise for consideration in this case any more than it arose in Cavendish. Lord Mance JSC noted that the appeals before the Supreme Court did not raise for consideration whether there should be any extension of the penalties doctrine as propounded in Andrews but rather whether it should be abolished or restricted in English law: [2015] 3 WLR 1373 at 1428 [130]; [2016] 2 All ER 519 at 572. Lord Hodge JSC described the suggestion as peripheral to the main arguments in the appeals but was satisfied that the rule against penalties in England and Scotland applied only in relation to penal remedies for breach of contract: [2015] 3 WLR 1373 at 1462 [241]; [2016] 2 All ER 519 at 604. 21 As to which see the observations of Lord Morris of Borth-y-Gest delivering the judgment of the Privy Council in Australian Consolidated Press Ltd v Uren (1967) 117 CLR 221 at 238; [1969] 1 AC 590 at 641. Prosecutions v Smith22, which the Chief Justice considered laid down propositions which were "misconceived and wrong"23. Twenty-five years later that evolutionary change was well entrenched. Mason CJ observed extra- judicially that the value of English judgments, like those of Canada, New Zealand and the United States, "depend[ed] on the persuasive force of their reasoning."24 So too, no doubt, for the courts of the United Kingdom as they consider the decisions of courts of other common law jurisdictions. The common law in Australia is the common law of Australia. So much was affirmed in the unanimous judgment of this Court in Lange v Australian Broadcasting Corporation25 and in cases that followed it26. Following the enactment of the Australia Acts and the abolition of the last remaining avenue of appeal to the Privy Council from the Supreme Courts of the States27, s 80 of the Judiciary Act was amended by substituting the term "common law in Australia" for the term "common law of England"28. The common law of England was a source of law for legal development in Australia, but not the only source29. Moreover, as the alternative claims in the present case demonstrate, there are few areas of the common law which are untouched by statutory regimes reflecting public policy settings which may differ from one jurisdiction to another. 23 Parker v The Queen (1963) 111 CLR 610 at 632-633; [1963] HCA 14. 24 Mason, "Future Directions in Australian Law", (1987) 13 Monash University Law Review 149 at 154. 25 (1997) 189 CLR 520 at 562-566; [1997] HCA 25. 26 Lipohar v The Queen (1999) 200 CLR 485 at 509-510 [57] per Gaudron, Gummow and Hayne JJ; [1999] HCA 65; Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 61-62 [23] per Gleeson CJ, Gaudron and Gummow JJ; [1999] HCA 67; John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503; [2000] HCA 36 and see generally Zines, "The Common Law in Australia: Its Nature and Constitutional Significance", (2004) 32 Federal Law Review 337. 27 See eg Australia Act 1986 (Cth), s 11. 28 Law and Justice Legislation Amendment Act 1988 (Cth), s 41(1). 29 Finn, "Common Law Divergences", (2013) 37 Melbourne University Law Review 509 at 510-511 citing Allsop, "Some Reflections on the Sources of Our Law", speech delivered at the Supreme Court of Western Australia Judges' Conference, 18 August 2012 at 7. Differences have emerged from time to time between the common law of Australia and that of the United Kingdom in a number of areas. Those differences have not heralded the coming of winters of mutual exceptionalism. All of the common law jurisdictions are rich sources of comparative law whose traditions are worthy of the highest respect, particularly those of the United Kingdom as the first source. No doubt in a global economy convergence, particularly in commercial law, is preferable to divergence even if harmonisation is beyond reach. The common law process will not always be the best way of achieving convergence between common law jurisdictions. The penalty rule in the United Kingdom, a product of that process, was described by Lord Neuberger and Lord Sumption in their joint judgment in Cavendish as "an ancient, haphazardly constructed edifice which has not weathered well"30. More than one account of its construction and more than one view of whether it should be abrogated or extended or subsumed by legislative reform is reasonably open31. There has been much activity in this area within national jurisdictions and in the development of internationally applicable model rules and principles which were discussed in Cavendish in the judgments of Lord Mance32 and Lord Hodge33. It may be that in this country statutory law reform offers more promise than debates about the true reading of English legal history. 30 [2015] 3 WLR 1373 at 1380 [3]; [2016] 2 All ER 519 at 526. 31 Reports on penalty clauses by the English Law Commission in 1975 and the Scottish Law Commission in 1999 recommended that the scope of the rule against penalties be expanded by legislative intervention to include circumstances beyond breach of contract: Law Commission, Penalty Clauses and Forfeiture of Monies Paid, Working Paper No 61, (1975) at 12-19; Scottish Law Commission, Penalty Clauses, Report No 171, (1999) at 12-14. In rejecting the submission that the penalty doctrine should be abolished or restricted, Lord Mance and Lord Hodge acknowledged those recommendations and the general trend in other jurisdictions towards a more expansive operation for the rule: Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1439-1442 [162]-[170], 1466-1468 [256]-[268]; [2016] 2 All ER 519 at 582-585, 608-610. 32 [2015] 3 WLR 1373 at 1439-1441 [162]-[167]; [2016] 2 All ER 519 at 582-584. 33 [2015] 3 WLR 1373 at 1468 [264]-[265]; [2016] 2 All ER 519 at 610. The first appellant, Mr Paciocco, held two credit card accounts with the respondent ("the ANZ"). One of the terms and conditions to which Mr Paciocco agreed in respect of the provision of credit was that a "Late Payment Fee" would be charged to his account if the "Monthly Payment" plus any "Amount Due Immediately" shown on the statement of account which the ANZ issued was not paid by a specified date (being, until December 2009, by 28 days of the end of the "Statement Period" shown on the statement and, from December 2009, by the "Due Date" shown on the statement). The "Monthly Payment" was a reference to a minimum amount which an account holder was required to pay by a certain date. Customers were advised by the ANZ, in the document "ANZ Credit Cards Conditions of Use", that the Late Payment Fee could be avoided by paying the minimum Monthly Payment shown on the statement by the due date. The ANZ fixed the Late Payment Fee from time to time. It did so without consultation with its customers. Until December 2009, the fee was fixed at $35.00 and from December 2009, at $20.00. The ANZ did not suggest that it had determined the level of the fee by estimating the losses which might be occasioned to it by Mr Paciocco's delays in making payments. The fee is in any event one charged generally to customers conducting credit card accounts of this kind who are late in making the Monthly Payment and it is charged regardless of the amount of the Monthly Payment outstanding. In the proceedings below, the ANZ did not explain how the level of the fee had been arrived at. The primary judge in the Federal Court of Australia (Gordon J) referred34 to Andrews v Australia and New Zealand Banking Group Ltd35, in which the High Court held that a stipulation prima facie imposes a penalty if it is a collateral stipulation which, upon failure of a primary stipulation, imposes upon one party an additional detriment to the benefit of another party. Her Honour also had regard36 to the "tests" stated by Lord Dunedin in Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd37. Her Honour 34 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 35 (2012) 247 CLR 205 at 216 [10]; [2012] HCA 30. 36 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 37 [1915] AC 79 at 86-88. reasoned38 that the Late Payment Fees were prima facie a penalty. Given the ANZ's admission that the Late Payment Fees were not genuine pre-estimates of its damage, the question which remained was "to what extent (if any) did the amount stipulated to be paid exceed the quantum of the relevant loss or damage which can be proved to have been sustained by the breach, or the failure of the primary stipulation, upon which the [collateral] stipulation [for the Late Payment Fee] was conditioned". Her Honour held39 that the stipulation for the Late Payment Fee was to be viewed as "security for, or in terrorem of, the satisfaction of the primary stipulation" and that "each of [the sums charged] is extravagant and unconscionable." In reaching these conclusions, and consistently with the question which had been identified as relevant, the primary judge accepted and applied40 evidence, adduced by the appellants, which assumed that the only damage that the ANZ could be said to have suffered as a result of the late payments was direct costs associated with the recovery of the minimum payment outstanding. Her Honour rejected other evidence, given for the ANZ, which calculated the costs to it more widely and by reference to certain of its financial interests which, it was said, were adversely affected by the late payments. On appeal, the Full Court of the Federal Court (Allsop CJ, Besanko and Middleton JJ) held41 that this evidence should have been taken into account and that it showed that the fees were not of the nature of penalties, having regard to the legitimate interests of the ANZ in the performance of the terms for payment. The Full Court allowed the appeal from her Honour's decision. What is a penalty? In Dunlop, Lord Dunedin described42 the "essence" of a penalty as "a payment of money stipulated as in terrorem of the offending party". By way 38 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 39 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 292 [182]-[183]. See also at 279 [116], 289 [168], 302 [239]-[240]. 40 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 41 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 42 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 of comparison, the essence of liquidated damages is "a genuine covenanted pre-estimate of damage" by the parties. Lord Dunedin's speech in Dunlop has been described as containing a "potpourri of old learning and new"43 and in the former respect to reflect "centuries of equity jurisprudence"44. His Lordship's description of the essence of a penalty would fall into this category. The contrasting concept of liquidated damages for breach of contract belongs to a later period. It has been suggested45 that the reference to a penalty terrorising persons may not be especially helpful, for penalties may be readily agreed to "by parties who are not in the least terrorised by the prospect of having to pay them and yet are … entitled to claim the protection of the court". The Late Payment Fee charged by the ANZ would not appear to have caused Mr Paciocco undue concern, as he would regularly pay the minimum Monthly Payment late and incur the fee, of which he was fully aware. However, the point to be made is that threats and punishment were regarded as the essential characteristics of a penalty. A sum stipulated to be paid on default, which amounted to a threat to the person obliged to pay it if the principal obligation was not performed, bore the character of a penalty, as did a sum stipulated to be paid which could not be accounted for other than as a punishment for default. The distinction drawn in Andrews46, between the primary stipulation and the penalty which is collateral to it, directs attention to penal bonds, which were largely used historically to bind persons to the performance of an obligation. Professor Simpson gives47 the example of a simple common money bond, where A loans B £100. B would execute a bond for a larger sum, which was normally twice the sum lent, thus binding himself to pay £200 on a fixed day. The bond would be subject to a condition of defeasance, which provides that if B pays £100 before the due date, the bond will be void. A similar method was employed for conveying property. 43 Rossiter, Penalties and Forfeiture, (1992) at 32. 44 Rossiter, Penalties and Forfeiture, (1992) at 33. 45 Bridge v Campbell Discount Co Ltd [1962] AC 600 at 622 per Lord Radcliffe. 46 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 47 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 395. The penal bond with conditional defeasance was the principal device for framing substantial contracts in the later medieval and early modern periods48. It was adaptable to different transactions and provided certainty. It was the bond that created the debt; it did not just evidence the debt49. Thus, it allowed for an action in debt to be brought upon the bond, rather than upon the covenant or agreement it secured. There were limited defences which could be raised in the action (namely, that the condition had been performed, the condition had been substantially performed or the condition was impossible to perform)50. But penal bonds could operate harshly because of the amount usually required to be paid on default and because any act of default meant the monies were payable. Nevertheless, the law enforced penal bonds strictly, because it regarded their function as compensatory51. A creditor could legitimately contract for compensation for loss suffered through the debtor's failure to pay on time. It was on this basis that the law distinguished between such transactions and transactions containing usurious terms (which were payment for the use of money and therefore illegal)52. It was also considered that a debtor could prevent paying a penalty by paying promptly53. Equity also viewed the purpose of penal bonds as compensatory and this was the basis for its intervention54. Equity looked to what condition the bond was security for and allowed the obligee compensation for the loss flowing from failure of the condition (usually limited to principal, interest and costs)55. The 48 Ibbetson, A Historical Introduction to the Law of Obligations, (1999) at 30. 49 Rossiter, Penalties and Forfeiture, (1992) at 2. 50 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 403-409. 51 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 412-420. 52 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 412. 53 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 413. 54 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 55 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 418-419. See, eg, Friend v Burgh (1679) Rep T Finch 437 [23 ER 238]; Puleston v Puleston (1677) Rep T Finch 312 [23 ER 171]. purpose of a bond was only to secure the interest of the obligee in the promise or undertaking to be performed56. Where compensation was possible for default, the exaction of a penalty was deemed inequitable57. The aim of the equity courts was to compensate in the event of default, not to punish58. It follows that they would not tolerate individuals exacting punishment. This early understanding of what constituted a penalty finds expression today in the definition given by Mason and Deane JJ in Legione v Hateley59: "A penalty, as its name suggests, is in the nature of a punishment for non-observance of a contractual stipulation; it consists of the imposition of an additional or different liability upon breach of the contractual stipulation". This definition was referred to with approval in Andrews60 and, more recently, by the United Kingdom Supreme Court in Cavendish Square Holding BV v Makdessi61 (albeit in a more qualified sense), where arguments that the penalty doctrine should be abolished or restricted were rejected. As Lord Neuberger of Abbotsbury and Lord Sumption observed62, the innocent party may have interests in the enforcement of the primary obligation but can have no proper interest in simply punishing the defaulter. 56 See Rossiter, Penalties and Forfeiture, (1992) at 13, citing Sloman v Walter (1783) 1 Bro CC 418 at 419 [28 ER 1213 at 1214]. 57 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 418. See also Francis, Maxims of Equity, (1728) at 52: "Equity suffers not Advantage to be taken of a Penalty or Forfeiture, where Compensation can be made." 58 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 420. 59 (1983) 152 CLR 406 at 445; [1983] HCA 11. 60 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 61 [2015] 3 WLR 1373 at 1392 [31] per Lord Neuberger of Abbotsbury and Lord Sumption; [2016] 2 All ER 519 at 537-538. 62 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1392 [32]; [2016] 2 All ER 519 at 538. The consequence of compensation forming the basis of equitable intervention was that where compensation was not possible, or damages could not be assessed, relief could not be given by equity63. Compensation might not be possible because the condition on which the bond was made was in respect of an interest not measurable in damages64. As explained in Andrews65, it is the availability of compensation which generated the "equity" upon which the court intervened; without it, the parties were left to their legal rights and obligations. The primary factor in the decline of the conditional penal bond and the rise of the modern law of penalties has been said to be the practice of the Court of Chancery in relieving against forfeiture66. By the time cases such as Dunlop came to be decided, the conditional penal bond may not have been much in use, although it was not wholly obsolete when Professor Simpson was writing67 and is not today. Examples referred to in Andrews68 are irrevocable letters of credit and "performance bonds" which are used in the construction industry. While Dunlop does not contain any such discussion of the origins and purposes of the penalty doctrine (as canvassed above), much of what is said in Dunlop is better understood by reference to them. Relevant aspects of Dunlop The aspect of Dunlop which assumes particular importance in this case is the recognition that a sum stipulated for payment on default may be intended to 63 Peachy v Duke of Somerset (1721) 1 Str 447 at 453 [93 ER 626 at 630]. 64 See, eg, Tall v Ryland (1670) 1 Chan Cas 183 [22 ER 753] (a condition to behave civilly and not disparage his neighbour's goods). See also Roy v Duke of Beaufort (1741) 2 Atk 190 [26 ER 519] (a condition not to trespass onto the Duke's land to shoot, hunt or fish); Rolfe v Peterson (1772) 2 Bro PC 436 [1 ER 1048] (a condition not to plough up any of the ancient meadow or pasture ground). 65 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 66 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 415. 67 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 421; Simpson, A History of the Common Law of Contract: The Rise of the Action of Assumpsit, (1987) at 125. 68 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 protect an interest that is different from, and greater than, an interest in compensation for loss caused directly by the breach of contract. This is most evident from the speech of Lord Atkinson. It has already been observed that equity recognised that there may be injury to interests for which compensation cannot be made and to which the doctrine of penalties cannot be applied to provide relief. That will usually be because of the nature of the interest protected by the provision for payment on default. In Ringrow Pty Ltd v BP Australia Pty Ltd, it was said69 that Dunlop continues to express the law to be applied with respect to penalties in Australia. As the primary judge in these proceedings observed70, the principles in Dunlop were not affected by the decision of this Court in Andrews. But this does not mean that those principles are confined, or that they are limited, to the "tests" propounded by Lord Dunedin, or that what was said in Dunlop does not require further explication. In Ringrow the Court was concerned71 with an argument which focused upon Lord Dunedin's speech in Dunlop and the "tests" which were offered to assist in the determination of whether a sum stipulated to be paid on default is, or is not, a penalty. In comparison, in Andrews reference was made to Dunlop, not to Lord Dunedin's "tests", but rather to Lord Atkinson's identification72 of the interests which were sought to be protected by the provision stipulating for payment of monies on breach and which accounted for that provision not being a penalty. It was said73 that "the critical issue, determined in favour of the appellant [Dunlop], was whether the sum agreed was commensurate with the interest protected by the bargain." The fact that the decision in Dunlop itself, and Lord Atkinson's reasons with respect to it, assume importance in this case does not deny the significance 69 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 663 [12]; [2005] HCA 71. 70 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 71 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 662 [11]. 72 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 73 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 of the requirement stated by Lord Dunedin74, that the sum stipulated be "extravagant and unconscionable" before it can be characterised as a penalty. As explained below, it is these words that, by their extreme nature, identify the penal character of a penalty. The question which may be identified as arising from this aspect of the decision in Dunlop, which is appropriate to a case of this kind, is whether a provision for the payment of a sum of money on default is out of all proportion to the interests of the party which it is the purpose of the provision to protect. This interest may be of a business or financial nature. The Dunlop "tests" The distinction drawn by Lord Dunedin between liquidated damages and a penalty, whilst useful, should not be understood as a limiting rule. It does not mean that if no pre-estimate is made at the time a contract is entered into, as is the case here, a sum stipulated will be a penalty. Nor does it mean that a sum reflecting, or attempting to reflect, other kinds of loss or damage to a party's interests beyond those directly caused by the breach will be a penalty. Indeed the provision in Dunlop, which was held not to be a penalty, was of this kind. The question whether a sum to be paid on default is a penalty, as distinct from liquidated damages, was said by Lord Dunedin75 to be a question of construction, but his Lordship is not to be taken to suggest that it will be answered by the language of the contract alone. This is evident from the reference to the "inherent circumstances" of the contract, which includes the position of the party whose interests are to be protected by the stipulation for the payment of the sum on default. Lord Dunedin offered76 four "tests" to assist "this task of construction". They were couched in the language of their time and were intended as guidance only. Tests tend, over time, to encourage literal application. Especially is this so where the basal purpose of the larger principle, or policy, of the law is not stated. That policy has not changed over time. It is that a sum may not be stipulated for payment on default if it is stipulated as a threat over the person obliged to perform; it may not be stipulated where the purpose and effect of requiring payment is to punish the defaulting party. This latter prohibition has found expression in modern times, as is evident from the passage from Legione v 74 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 75 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 76 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 Hateley referred to above77 and also from judgments in Cavendish78. It may be inferred from this policy that a sum stipulated for payment on default is a penalty if it bears no relation to the possible damage to or interest of the innocent party. The first, and principal, "test" stated by Lord Dunedin79 is that a sum stipulated will be a penalty if it is: "extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to have followed from the breach." If the "test" is understood to convey that only loss in the nature of damages directly flowing from the breach is to be considered, then it is unduly restrictive, though no doubt it remains useful to many cases. The terms "extravagant" and "unconscionable" (and also "exorbitant") had been used in Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda, where the Earl of Halsbury LC said80 that the jurisdiction given to the court to interfere in an agreement between parties was with respect to an agreement which was "unconscionable and extravagant, and one which no Court ought to allow to be enforced." Even earlier, the Scottish Court of Session in Forrest and Barr v Henderson, Coulborn, and Co had said81 that "equity will interfere to an exorbitant and the claim being maintained unconscionable amount." As explained below, "extravagant", "exorbitant" and "unconscionable" are "strong words"82; despite the different expressions used, they all describe the plainly excessive nature of the stipulation in comparison with the interest sought to be protected by that stipulation. to prevent 77 Legione v Hateley (1983) 152 CLR 406 at 445. 78 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1392 [32] per Lord Neuberger and Lord Sumption, 1434 [148] per Lord Mance, 1462 [243] per Lord Hodge; [2016] 2 All ER 519 at 538, 577-578, 605. 79 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 87 (4(a)). 80 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 10. 81 Forrest and Barr v Henderson, Coulborn, and Co (1869) 8 M 187 at 193. See also 82 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1473-1474 [293]; [2016] 2 All ER 519 at 615. The second "test"83 was said to be merely a corollary of the first, and concerns the case where the breach is constituted by a mere failure to pay a sum of money. The sum stipulated to be paid in the event of a breach will be a penalty if it is greater than the sum which ought to be paid. This reflects equity's concerns about penal bonds and its view that the tender of principal together with interest thereon is sufficient compensation. This "test" has a narrow range of operation and is confined to the simplest of cases. It does not take into account that damages for breach may now include interest by way of damages and opportunity costs84. It says nothing about the damage to a party's wider commercial interests, for example to its trading, which was the real issue in Dunlop. And it says nothing about the financial effects for which the ANZ contends. The third "test"85 is stated as a presumption ("(but no more)") that a sum will be a penalty where it is a single sum made payable on the occurrence of one or more of several events, some of which may occasion serious, and others only inconsequential, damage. The presumption derives from what was said by Lord Watson in Lord Elphinstone v Monkland Iron and Coal Co86: "When a single [lump] sum is made payable by way of compensation, on the occurrence of one or more or all of several events, some of which may occasion serious and others but trifling damage, the presumption is that the parties intended the sum to be penal, and subject to modification." However, the provision for payment in that case was not in fact of that kind. It was referable to a single obligation and the sum to be paid bore "a strict proportion to the extent to which that obligation is left unfulfilled."87 In Ringrow, this Court said88 that this reasoning "did not require there to be a strict proportion; it merely relied, as a step towards the conclusion that the 83 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 87 (4(b)). 84 Hungerfords v Walker (1989) 171 CLR 125; [1989] HCA 8. 85 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 87 (4(c)). 86 (1886) 11 App Cas 332 at 342. 87 Lord Elphinstone v Monkland Iron and Coal Co (1886) 11 App Cas 332 at 345 per Lord Herschell LC. See also at 342-343 per Lord Watson. 88 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 668 [28]. compensation was not compensation bore a strict proportion to the unfulfilled obligation." inordinate or extravagant, on the fact that the Further, because a provision of the kind mentioned is merely a presumption, it may be rebutted. In Dunlop, Lord Atkinson observed89 that it was there rebutted by the fact that the damage caused by default may be of such an uncertain nature that it cannot be accurately ascertained. The last "test"90 stated by Lord Dunedin in Dunlop refers to just such a circumstance. It identifies the case where the parties agree a figure although a forecast of loss, in reality, is almost impossible. Nevertheless, the sum agreed may not be a penalty, indeed it is likely that in circumstances such as these it is not. His Lordship said: "It is no obstacle to the sum stipulated being a genuine pre-estimate of damage, that the consequences of the breach are such as to make precise pre-estimation almost an impossibility. On the contrary, that is just the situation when it is probable that pre-estimated damage was the true bargain between the parties". A similar observation had been made in Clydebank91. What Lord Dunedin was pointing to is damage of a kind which is different from that for which liquidated damages could be assessed. It will be different because the interests of the party which are intended to be protected by the provision in question extend beyond an interest in the recovery of compensation for loss caused by the obligation. This was the situation in Dunlop. Interests: Clydebank, Dunlop and Cavendish The agreement in Dunlop was headed "Price Maintenance Agreement" and contained provisions for resale price maintenance, which was clearly not then a prohibited practice. It bound the respondents, as dealers in goods manufactured by Dunlop, inter alia, not to sell or offer the goods at less than Dunlop's list price and to pay £5 for each item sold at less than that price. 89 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 90 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 87-88 (4(d)). 91 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 11. It followed from these terms that the sale of even one tyre, cover or tube at less than the listed price would attract the sum stipulated to be paid. An argument, reminiscent of one raised in this case concerning the Late Payment Fee, that Dunlop could not possibly lose that sum on the occasion of each sale, was rejected. The argument, Lord Atkinson observed92, missed the point about the purpose of the agreement and the nature of the possible injury to Dunlop's trade. Dunlop's object in making the agreement, Lord Atkinson said93, was to prevent disorganisation of its trading system. His Lordship said: "[Dunlop] had an obvious interest to prevent this undercutting, and on the evidence it would appear to me impossible to say that that interest was incommensurate with the sum agreed to be paid." In Clydebank, having observed that agreements for the payment of sums on default operate as "instruments of restraint", Lord Robertson identified94, similarly to Lord Atkinson in Dunlop, the relevant question as: "Had the respondents no interest to protect by that clause, or was that interest palpably incommensurate with the sums agreed on?" In Clydebank, the contract between the appellant shipbuilders and the Spanish government for the building of torpedo boats contained a clause providing for a "penalty for later delivery … at the rate of £500 per week for each vessel"95. The fact that the sum was called a penalty was not, of course, conclusive. In holding that the stipulated sum was not a penalty, it was acknowledged that the interests of the Spanish government in having the vessels delivered on time were complex and that how those interests would sound in damages was extremely difficult to prove96. 92 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 93 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 92. See also at 88 per Lord Dunedin, 99 per Lord Parker of Waddington. 94 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 19-20. 95 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 7. 96 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 11, 20. In Cavendish, non-competition provisions, in an agreement for the sale of a controlling interest in a business, which had the effect that, upon breach, the seller would not be entitled to any further payments of the purchase price were held not to be penalties. The provisions were seen as protective of the interests of the purchaser in the goodwill of the business, such goodwill being critical to the value of the business97. It was of some importance in Dunlop and Clydebank that the nature of the innocent party's interests, which would be injured by breach, was such that it would be difficult to estimate and to prove damage. This difficulty of proof, and the uncertainty of the loss which could arise, made it reasonable for the parties to agree beforehand what the figure for damages should be in order to avoid the problem98. In Cavendish it was observed99 that there is good reason to leave the assessment of the value of a complex interest as a matter of negotiation between the parties, especially since the court may not be in a position to value the interest itself. For present purposes it is perhaps more relevant to observe that difficulties of this kind may render problematic proof that a sum stipulated is a penalty. It was not suggested in either Clydebank or Dunlop that the damage to the Spanish government's or to Dunlop's interests was impossible to estimate; rather, it appears that the damage was capable of estimation, albeit with little precision. It might be thought that the damage to the interests identified in Clydebank in particular might have qualified as impossible to prove, but the Earl of Halsbury LC went only so far as to say that it would be "extremely complex, difficult, and expensive"100 to do so. And in Dunlop, the estimation was referred to as "almost an impossibility"101. It will be recalled that equity's jurisdiction was 97 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1405 [75] per Lord Neuberger and Lord Sumption, 1444-1445 [179]-[180] per Lord Mance, 1469 [274] per Lord Hodge; [2016] 2 All ER 519 at 550, 587-588, 611. 98 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 88; Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 10-11, 17. See also Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1432-1433 [143] per Lord Mance; [2016] 2 All ER 519 at 576. 99 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1405-1406 [75] per Lord Neuberger and Lord Sumption; [2016] 2 All ER 519 at 550-551. 100 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 11. 101 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 87-88 per Lord Dunedin. See also at 95-96 per Lord Atkinson. considered not to extend to a case when compensation was not thought to be possible, as is the case when damages could not be assessed. In these circumstances the parties would be left to their bargain. What was said in Dunlop, and in Clydebank, about it being reasonable, in cases of difficulty in the estimation of possible loss, to leave the parties to contract for themselves for a sum to be paid on default might be thought to come close to an acceptance that they be left to their bargain. However, this would overlook the fact that the courts in those cases went on to determine whether the figure arrived at was a penalty and that they did so by considering whether it was unconscionable or extravagant in amount. A sum out of all proportion to the interests protected Lord Dunedin said in Dunlop102 that there may be no reason to suspect that the figure agreed by the parties, in the case where loss is difficult to estimate, is "a penalty to be held in terrorem", "provided that figure is not extravagant". Lord Atkinson103 and Lord Parmoor104 also held that the figure in question was not extravagant, unconscionable or extortionate. The process to be undertaken in order to determine whether an amount is unconscionable or extravagant was not further explained in Dunlop and Clydebank. The figure agreed to be paid cannot be compared with a sum certain, as is the case with Lord Dunedin's first "test". It can only be gauged against the identified interests of the party in whose favour the stipulation is made. It may be inferred from Dunlop and Clydebank that the interests in question were regarded as substantial and the possibility of damage to them real. The sum agreed to be paid in those cases was not incommensurate with the relevant interests105. 102 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 103 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 104 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 105 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 20 per Lord Robertson; Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 92 per Lord Atkinson. In Clydebank106, the Earl of Halsbury LC did not consider that a rule could be laid down as to when a stipulation could be said to be extravagant or unconscionable and that much would depend upon the circumstances of each case. However, it is to be inferred from the adjectives chosen that not every sum in excess of what might be strictly compensatory will amount to a penalty. This is confirmed by the example, admittedly extreme, which his Lordship then gave of an agreement to build a house for £50 but "to pay a million of money as a penalty" if the house was not built. This suggests that a person contending that a sum is a penalty will be facing a high hurdle. Lord Hodge was later to observe in Cavendish107 that the criterion of exorbitant or unconscionable should prevent the enforcement of only egregious contractual provisions. In Ringrow, it was held108 that a sum which was merely disproportionate to the loss suffered would not qualify as penal. It was explained that exceptions from freedom of contract "require good reason to attract judicial intervention to set aside the bargains upon which parties of full capacity have agreed", which is why the law on penalties is expressed as an exceptional rule and in exceptional language. The Court went on: "It explains why the propounded penalty must be judged 'extravagant and unconscionable in amount'. It is not enough that it should be lacking in proportion. It must be 'out of all proportion'." In Cavendish, Lord Neuberger and Lord Sumption said109 that the true test is whether the provision is a secondary obligation which imposes a detriment on the party in breach "out of all proportion to any legitimate interest of the innocent party in the enforcement of the primary obligation." Australian and United Kingdom law are not alone in maintaining a standard to be applied to a requirement to pay money, or some other detriment, which is imposed in the event of default. In many other western legal systems something like the penalty doctrine exists. In Andrews, reference was made110 to 106 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 10. 107 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1468 [266]; [2016] 2 All ER 519 at 610. 108 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 669 [31]-[32]. 109 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1392 [32]; [2016] 2 All ER 519 at 538. 110 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 at 224-225 [38]. See also Zimmermann, The Law of Obligations, (1996) at 107-108. s 343 of the German Civil Code, which provides that a "disproportionately high" penalty may be reduced by a court after taking into account "every legitimate interest" of the party for whose benefit the stipulated sum is made. Such interests are not limited to that party's economic interests. In Cavendish, Lord Hodge referred111 to provisions in other modern civil codes and international instruments which use tests such as whether the sum stipulated is "manifestly excessive" or "substantially disproportionate" in order to modify or restrict contractual penalties. It has earlier been observed that the nature of an interest and of the injury to it may make for difficulties of proof that the sum stipulated is a penalty. In Clydebank, Lord Robertson acknowledged112 that the problem was not one for the Spanish government: "But, in truth, the only apparent difficulty in the present case arises from the magnitude and complexity of the interests involved and of the vicissitudes affecting them, and as the question is whether this stipulation of £500 a week is unconscionable or exorbitant, these considerations can hardly be considered a formidable difficulty in the way of the respondents." The Late Payment Fee: a penalty? The ANZ's interests in this case are not as diffuse as those considered in Dunlop, Clydebank and Cavendish. The ANZ did not suggest that the injury to its interests was not capable of some kind of estimation in money's worth. In the hearing before the primary judge it abandoned the claim, made in its defence, that the costs occasioned to it by late payments were impossible to calculate and argued instead that they were very difficult to calculate. On this appeal the appellants accepted that, being realistic, the law should allow a "measure of latitude" where pre-estimation of loss is difficult. Certainly there needs to be some recognition of the difficulties attending any such exercise and that there may, in some cases, be differences in approach to the proper methodology to be employed. But it also needs to be borne in mind that this task is not one which calls for precision. The conclusion to be reached, after all, is whether the sum is "out of all proportion" to the interests said to be damaged in the event of default. 111 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1468 [265]; see also at 1394 [37] per Lord Neuberger and Lord Sumption; [2016] 2 All ER 519 at 610; see also at 539-540. 112 Clydebank Engineering and Shipbuilding Co v Don Jose Ramos Yzquierdo y Castaneda [1905] AC 6 at 20. It is important at this point to identify the ANZ's interests. The ANZ had an interest in receiving timeous repayment of the credit that it extended to its customers, including the appellants. As explained below, late payment impacted the ANZ's interests in three relevant respects: through operational costs, loss provisioning and increases in regulatory capital costs. Evidence of the costs to the ANZ by reason of the late payments was given by Mr Regan for the appellants and by Mr Inglis for the ANZ. Their approaches were fundamentally different because of the instructions they had been given. As the primary judge observed113, Mr Regan was instructed to identify the amounts necessary to restore the ANZ to the position it would have been in had the late payments not been made. In contrast, Mr Inglis was instructed to consider the maximum amount of costs that the ANZ could conceivably have incurred as a result of a late payment. As a consequence Mr Regan calculated only the costs to the ANZ of ensuring that the late payments were made ("operational costs"), such as those costs incurred by the use of staff contacting Mr Paciocco and other administration costs. Mr Inglis calculated those costs and came to a higher figure than Mr Regan, but he also calculated other impacts on, or costs to, the ANZ's financial interests which were referred to in the proceedings below as "Increase in loss provisions" and "Increase in the cost of regulatory capital". As to the first category of costs, as the primary judge explained114, the ANZ is required to estimate the impairments to its financial assets in order that its financial statements reflect a fair value of what is likely to be collected from what is outstanding. It is required to make provision in its accounts for what it may not recover, albeit that the potential loss is expressed as a current cost. The primary judge does not appear to have cavilled with the opinion of Mr Inglis – that the reduction in the value of a customer's loan, as recorded in the accounts, was an accepted category of loss. However, her Honour held115 that the difficulty was that a provision of this kind is merely an accounting entry. At the time it is made it cannot be known whether all the cardholders recorded will default. In the case of Mr Paciocco he did not fall into this category because in fact he did not default; he merely paid late. 113 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 114 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 115 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 This reasoning is consistent with the primary judge's overall approach, which was to limit the ANZ's "costs" to actual damage incurred. However, this overlooks that the estimation is to be made at the time the Late Payment Fee is agreed upon; and it does not acknowledge that an effect upon the ANZ's interests may include the provision that it has to make concerning its overall position. As to the second category of costs, the ANZ is also required to hold regulatory capital to cover unexpected losses, a buffer of a kind. An increase in the risk of default increases the amount of regulatory capital which is required to be held. The primary judge accepted116 that regulatory capital has a cost to the ANZ, by way of the loss of additional return it could otherwise make on the amount held as regulatory capital. But her Honour did not accept117 that it should be taken into account in calculating loss or damage as a result of late payment. It was her Honour's view118 that loss provisions and regulatory capital costs are part of the costs of running a bank in Australia. Banks may, and do, seek damages for default, but they are limited to the sums outstanding, enforcement costs and interest. However, as has been explained, the question is not what the ANZ could recover in an action for breach of contract, but rather whether the costs to it and the effects upon its financial interests by default may be taken into account in assessing whether the Late Payment Fees are penalties. The primary judge accepted and applied Mr Regan's evidence. Her Honour considered119 that the main difficulty with Mr Inglis' evidence was that he did not calculate actual loss or damage, but rather engaged in a broad-ranging exercise of identifying "costs" that might be affected by late payment, in a more theoretical, accounting, sense. In her Honour's view this did not assist in answering the question which she had earlier identified: to what extent (if any) did the amount stipulated to be paid exceed the quantum of the relevant loss or damage which can be proved to have been sustained by the breach. But of course framing the question in this way takes no account of the ANZ's other interests 116 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 117 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 118 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 119 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 which were said to be addressed by the Late Payment Fees and which extend beyond the recovery of compensation for loss. The primary judge accepted120 that whilst the actual losses suffered by the ANZ by reason of the late payments could not be precisely determined, they were probably no more than $3.00 for each event of late payment (based on Mr Regan's evidence) and in any event much less than the $20.00 or $35.00 charged as a Late Payment Fee. They were therefore extravagant and unconscionable. Mr Inglis' evidence identified the costs to which the ANZ would be subject in the event of a late payment as a range which exceeded the amounts of the Late Payment Fee121. His calculations were criticised122 as overly generous. It is not necessary to resolve any such controversy. The effect of Mr Inglis' evidence was to identify potential costs to the ANZ, from late payments, which reflect injuries to its financial position. They were real because they had to be taken into account by the ANZ. The evidence called for the appellants did not address damage of this kind. It cannot therefore be concluded that the sums of $20.00 and $35.00 were out of all proportion to the interests so identified. Conclusion and orders It may be accepted that it is difficult to measure the loss to the ANZ as a result of a late payment. Consistently with Clydebank, Dunlop, Ringrow and Andrews, the relevant question in this case is whether the Late Payment Fee is out of all proportion to the ANZ's interest in receiving timeous payment of the minimum Monthly Payment. Applying this test, the appellants did not establish that the Late Payment Fee was a penalty. The appeal should be dismissed with costs. This appeal concerns whether the Late Payment Fee contravenes certain statutory provisions. I agree that this appeal should be dismissed with costs, for the reasons given by Keane J. 120 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 121 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 122 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 Introduction Two appeals are brought to this Court from orders made by the Full Court of the Federal Court of Australia (Allsop CJ, Besanko and Middleton JJ)123 on appeal from a judgment of a primary judge of that Court (Gordon J)124. The judgment of the primary judge was a final determination of claims made by applicants in a representative proceeding constituted under Pt IVA of the Federal Court of Australia Act 1976 (Cth). Their claims were to recover from Australia and New Zealand Banking Group Ltd ("ANZ") certain "exception fees" charged by ANZ under standard terms and conditions of contract with consumer credit card account holders. The appellants in each appeal were applicants in the representative proceeding; they can be called "the customers". The appeals are a sequel to the decision at an interlocutory stage of the representative proceeding in Andrews v Australia and New Zealand Banking Group Ltd125. The controversy that now returns to this Court is confined to legal characterisation of a single class of exception fee – contractually designated "late payment fee" – charged to one customer, Mr Paciocco. The ultimate question in the first appeal is whether the contractual stipulation for the late payment fee was unenforceable as a penalty at common law. The ultimate question in the second appeal is whether that stipulation or its enforcement contravened one or more of several applicable statutory norms prohibiting ANZ from engaging in "unconscionable conduct" and from entering into and enforcing contracts which were "unjust" and "unfair". Before turning to subsidiary issues involved in answering those questions, there is utility in recording the contractual provisions under which the late payment fee was imposed, in giving an outline of the evidence bearing on the quantification of that fee, and in noting the reasoning of the primary judge and of the Full Federal Court. 123 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199. 124 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249. 125 (2012) 247 CLR 205; [2012] HCA 30. The contracts The customers' claims in the representative proceeding related to the period between September 2006 and September 2013. During that period, Mr Paciocco had two credit card accounts with ANZ. Both were "Low Rate MasterCard" accounts. One had been opened in June 2006 with an initial credit limit of $15,000 which was increased to $18,000 in November 2009. The other was opened in July 2009 and had a credit limit of $4,000. The terms and conditions on which ANZ contracted for the provision of each of those credit card accounts were contained in three standard form documents sent to Mr Paciocco by ANZ: a standard form Letter of Offer; a booklet entitled "ANZ Credit Card Conditions of Use"; and another booklet entitled "ANZ Personal Banking Account Fees and Charges". The standard terms and conditions set out in the ANZ Credit Card Conditions of Use provided for ANZ to issue monthly statements of account. Each monthly statement was to show the closing balance of the account, the "minimum monthly payment" and the "due date". The minimum monthly payment was ordinarily to be the greater of $10 or 2% of the closing balance shown on the statement, but to be the full closing balance if the closing balance shown on the statement was less than $10. The due date was to be a date a specified number of days after the end of the monthly period to which the statement related. The account holder was obliged to make the minimum monthly payment shown on each monthly statement by the due date shown on the statement. If the account holder did not pay the closing balance by the due date, the account holder was to be charged interest on each purchase shown on a statement of account, and on all subsequent purchases, until the closing balance was paid in full by its due date. The account holder was not otherwise to be charged interest on purchases (and therefore received credit for purchases interest free if the closing balance of the statement on which the purchase transaction appeared was paid in full by its due date) but was always to be charged interest on cash advances from the date of each cash advance. The annual percentage rate used to calculate the interest charges on the account was to be that notified by ANZ from time to time. Under the heading "Fees and charges", the ANZ Credit Card Conditions of Use provided: "ANZ reserves the right to charge the credit card account with fees and charges for the provision and operation of the credit card account. The fees and charges applicable to the credit card account are those shown in the Letter of Offer and in the ANZ Personal Banking Fees and Charges booklets, as varied from time to time." The late payment fee was one of the fees and charges applicable to each credit card account shown in the standard form Letter of Offer and in the ANZ Personal Banking Account Fees and Charges booklet. ANZ had the right to charge the late payment fee to the account if the minimum monthly payment was not paid by the due date. The amount of the late payment fee was set by ANZ at $35 until December 2009. It was reduced to $20 from December 2009. Under the heading "Default, cancellation and termination", the ANZ Credit Card Conditions of Use provided for the credit card to be cancelled and the outstanding balance of the account to become immediately due and payable, at the option of ANZ, if the account holder came into default. Coming into default included for that purpose the account holder failing to meet any of the account holder's obligations under the credit card contract. The ANZ Credit Card Conditions of Use went on to provide in that context: "Any reasonable amount reasonably incurred or expended by ANZ in exercising its rights in relation to the credit card account arising from any default (including expenses incurred by the use of ANZ's staff and facilities) are enforcement expenses and become immediately payable by the account holder. ANZ may debit the credit card account for such amounts without notice." Finally, the ANZ Credit Card Conditions of Use provided for the account holder to close the credit card account at any time by giving notice to ANZ, and for ANZ to change any term or condition of the credit card contract by giving notice to the account holder. The charges During the period to which the customers' claims related, ANZ charged the late payment fee to Mr Paciocco's accounts on 26 occasions and Mr Paciocco subsequently paid the amounts charged to ANZ. Eight of those occasions were before December 2009, when the applicable charge was $35. Eighteen were after December 2009, when the applicable charge was $20. For the purpose of illustrating their respective arguments in the appeals, the parties chose to focus on six of those 26 occasions. The sample comprised two charges of $35 made to the credit card account having the higher credit limit before December 2009, a single charge of $20 made to that same account after December 2009, and three charges of $20 made after December 2009 to the credit card account having the lower credit limit. The two illustrative charges of $35 were made to the credit card account which had the higher credit limit at a time when that credit limit was $15,000. At the time of the first charge, the outstanding monthly balance was $10,199 and the minimum monthly payment was $203. At the time of the second charge, the outstanding monthly balance was $11,220 and the minimum monthly payment was $223. The single illustrative charge of $20 made to that same account was made when the credit limit had risen to $18,000. The outstanding monthly balance was then $18,025 and the minimum monthly payment was $358. Of the three charges of $20 made to the credit card account which had the lower credit limit of $4,000, the first was made at a time when the outstanding monthly balance was $2,145 and the minimum monthly payment was $43. The second was made at a time when the outstanding monthly balance was $268 and the minimum monthly payment was $10. The third was made at a time when the outstanding monthly balance was $4,055 and the minimum monthly payment was $80. The primary judge found that ANZ's Collections Business Unit contacted Mr Paciocco on most of the occasions when he failed to make a minimum monthly payment by its due date and that Mr Paciocco promised to make a payment each time he was contacted. The primary judge also found that, throughout the period to which the claim in the representative proceeding related, Mr Paciocco was aware of the late payment fee and other fees and charges applicable to his credit card accounts and found it convenient to manage his credit card accounts close to their limits, choosing to accept the risk of incurring fees associated with that course of conduct126. The evidence about the amount of the late payment fee ANZ made a formal admission on the pleadings that it did not determine the quantum of the late payment fee by reference to a sum that would have been recoverable as unliquidated damages. Evidence in the representative proceeding showed that fees broadly equivalent to the late payment fee were charged in varying amounts by other banks which provided credit cards to consumer customers in competition with ANZ during the period of the claims made in the proceeding. The reduction of the late payment fee from $35 to $20 in December 2009 occurred not long after reductions by other banks. Documentary evidence was adduced concerning the considerations which led ANZ to set and maintain the amount of the late payment fee at $35 and then 126 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at to reduce it to $20, but that evidence was described by the primary judge as "incomplete" and "of limited use"127. The primary judge drew no conclusions from it. The main evidence bearing on the amount of the late payment fee was opinion evidence given by two accountants: Mr Regan and Mr Inglis. They were asked to, and did, perform two quite different tasks. Mr Regan was asked by the customers to calculate, in respect of the late payment events which gave rise to the charge of the late payment fee to Mr Paciocco, "how much money it would take to restore ANZ to the position it would have been in if the particular event giving rise to the entitlement to charge such fees had not occurred". Performing that task, Mr Regan calculated the variable or incremental operational costs incurred within ANZ's Collections Business Unit in making or attempting to make contact with Mr Paciocco following each of the 26 late payment events which were the subject of his claim. Mr Regan calculated those costs to have ranged from $5.50 to 50c, and to have been on average $2.60. Mr Inglis was asked by ANZ to assess, in respect of all of the consumer credit card accounts offered by ANZ in each financial year to which the customers' claims related, "the costs that may have been incurred by ANZ in connection with the occurrence of events that gave rise to an entitlement to charge [the late payment fee]". To perform that task, Mr Inglis undertook an assessment of costs incurred by ANZ in connection with the occurrence of events that gave rise to an entitlement to charge the late payment fee to all of the holders of consumer credit card accounts who had been charged during the financial year ended September 2009. He then extrapolated those results to other years. During the financial year ended September 2009, ANZ had around two million consumer credit card accounts. It charged the late payment fee on around 2.4 million occasions. Its revenue from charging the late payment fee was around $75 million. Mr Inglis identified three categories of costs as having been incurred by ANZ in connection with the occurrence of the events that gave rise to an entitlement to charge the late payment fee. Those categories comprised provisioning costs and regulatory capital costs, in addition to operational costs which were principally costs associated with the activities of ANZ's Collections Business Unit. Each of those categories warrants a short explanation. 127 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at Provisioning costs were expenses which, in accordance with applicable accounting standards, ANZ recognised in its profit and loss account representing reductions in the value of customer accounts attributable to risk of default. Because the probability of default increased with late payment, late payment of balances contributed to the overall level of the expense required to be recognised. Mr Inglis assessed the average contribution of a late payment event to provisioning costs during the period relevant to ANZ's charge of the late payment fee to Mr Paciocco's accounts at $23 for the account with the higher credit limit or $27 for the account with the lower credit limit. Regulatory capital costs were costs which ANZ incurred in funding capital which ANZ was required by applicable prudential standards to hold as a buffer against unexpected losses. Because the amount of capital required to be held increased with the probability of default associated with late payment, late payment of balances contributed to the overall level of capital required, and with it the costs of funding that capital reserve. Mr Inglis assessed the average contribution of a late payment event to regulatory capital costs during the period relevant to ANZ's charge of the late payment fee to Mr Paciocco's accounts at $23 for the account with the higher credit limit or $5 for the account with the lower credit limit. The operational costs identified by Mr Inglis to be associated with ANZ's Collections Business Unit were costs attributable to the same collection activities as those identified by Mr Regan. However, unlike Mr Regan, who looked only to the variable or incremental costs of individual collections, Mr Inglis made an allowance for the recovery of a proportion of common costs and of fixed costs associated with overall collection activities. Mr Inglis assessed the average collection costs attributable to a late payment event during the period relevant to ANZ's charge of the late payment fee to Mr Paciocco's accounts as in excess of For the period during which a late payment fee of either $35 or $20 was charged to Mr Paciocco's accounts, Mr Inglis thereby assessed the average costs incurred by ANZ in connection with the occurrence of an event giving rise to an entitlement to charge the late payment fee as in excess of $50 for the account with the higher credit limit and in excess of $35 for the account with the lower credit limit. The approach of the primary judge The primary judge drew particular attention to two features of the late payment fee. One was that "the breach (or failure of the stipulation)" which gave rise to the obligation to pay the fee "consisted only in not paying a sum of money"128. The other was that "[t]he same fee was payable regardless of whether the customer was 1 day or 1 week late (or longer), and regardless of whether the amount overdue was $0.01 (trifling), $100, $1000 or even some larger amount"129. The second of those features was described as sufficient to give rise to a "presumption" that the late payment fee had the character of a penalty130. That "presumption" having arisen, the primary judge saw as the determinative question "to what extent (if any) did the amount stipulated to be paid exceed the quantum of the relevant loss or damage which can be proved to have been sustained by the breach, or the failure of the primary stipulation, upon which the stipulation was conditioned"131. Mr Regan's evidence was seen by the primary judge to have addressed that question; Mr Inglis' evidence, concluded the primary judge, did not132. Addressing the additional categories of costs which Mr Inglis had identified and which Mr Regan had not, the primary judge in any event considered that: a provisioning cost might have been "a 'cost' in an accounting sense" but it did "not represent a loss or damage incurred as a result of [a late payment] event"133; "provisions and regulatory capital [were] part of the costs of running a bank in Australia", and "[n]o increase in them [could] be directly or indirectly related to any of the late payments by Mr Paciocco"134. The primary judge assessed the loss or damage which ANZ sustained by each of Mr Paciocco's failures to pay the balance owing by the due date at "no 128 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 129 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 130 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 131 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 132 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 133 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 134 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at more than $3", that figure being "comprised of the operational (collections) costs identified by Mr Regan rounded up to the nearest half dollar"135. When compared with that assessed loss or damage, each late payment fee of either $35 or $20 was "extravagant and unconscionable", and for that reason each late payment fee was unenforceable as a penalty136. Having concluded that the customers had succeeded in establishing that the stipulation for the late payment fee was unenforceable at common law or in equity, the primary judge did not go on to consider whether the contractual imposition of the late payment fee contravened any of the statutory norms on which the customers relied in the alternative137. The primary judge's orders included a declaration that the late payment fee charged to Mr Paciocco's accounts on each of the 26 occasions "constituted a penalty at common law and a penalty in equity", a declaration that Mr Paciocco was entitled to the amount by which the late payment fee exceeded the costs of ANZ by reason of the events which gave rise to the charging of the late payment fee, and judgment for Mr Paciocco in an amount so calculated together with statutory interest. The approach of the Full Court ANZ and the customers each separately appealed to the Full Court. The Full Court dismissed the appeal of the customers, but allowed the appeal of ANZ and set aside each of the orders made by the primary judge. Allsop CJ gave the principal reasons for judgment. His Honour took the view that the primary judge had "undertaken an ex post inquiry of actual damage as a step in assessing whether the prima facie penal character of the late payment fee was rebutted"138 and "impermissibly narrowed the content of the notion of genuine pre-estimate of damage as a reflex of penalty"139. The correct approach, 135 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 136 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 137 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 138 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 139 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at his Honour said, was "to look at the greatest possible loss on a forward looking basis" and to assess that loss by reference to "the economic interests to be protected"140. Allsop CJ concluded that Mr Inglis' perspective had been correct, and that each of the categories of costs which Mr Inglis had identified and quantified on an average basis was a legitimate object of commercial interest for protection141. Having regard to the totality of the circumstances – which his Honour identified as including the interests of ANZ protected and the nature of the relationship between ANZ and a customer under which the customer could terminate a credit card account at will and choose whether and when to engage in transactions on the account – Allsop CJ concluded that "the fees were not demonstrated to be extravagant, exorbitant or unconscionable"142. From that conclusion, it followed that the late payment fee was not shown to be a penalty. Turning to the customers' argument that ANZ contravened applicable statutory norms by contractually imposing the late payment fee, Allsop CJ observed that a conclusion that ANZ acted unconscionably in relation to Mr Paciocco would be "difficult" in light of the facts that Mr Paciocco was aware of the fees and charges applicable to his credit card accounts, that it was convenient for him to manage his credit card accounts close to their limits, and that he chose to accept the risk of incurring fees associated with so doing143. After an extensive consideration of principle, his Honour concluded that ANZ did not engage in unconscionable conduct and that the credit card contracts were not unfair or unjust144. Besanko and Middleton JJ agreed with the reasoning of Allsop CJ in relation to both appeals. Choosing to address an argument which Allsop CJ and Middleton J did not find it necessary to consider, Besanko J added in relation to 140 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 141 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 142 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 143 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 144 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at the appeal by ANZ that he considered the claim to recover the earliest of the amounts paid by Mr Paciocco not to be statute barred145. The appeals to this Court The explanation for there being two appeals to this Court is that they are brought by the customers from the two distinct sets of orders of the Full Court, allowing the appeal to that Court by ANZ and dismissing the appeal to that Court by the customers. In the first of the appeals to this Court, in which the ultimate issue is whether the late payment fee was unenforceable as a penalty at common law, the parties agree that the governing principles are to be found in Andrews and in Dunlop Pneumatic Tyre Company Ltd v New Garage and Motor Company Ltd146. The heart of the dispute between them concerns the nature and content of the propositions of law for which Dunlop is to be treated as continuing authority in Australia. Their competing contentions reflect the competing approaches in the Federal Court. The customers support the approach of the primary judge. ANZ supports the approach of the Full Court. That dispute about Dunlop cannot adequately be addressed without some explanation of the significance and effect of the holding in Andrews. In the first appeal, ANZ seeks by notice of contention to re-agitate the argument, not considered by Allsop CJ or Middleton J but resolved against ANZ by Besanko J, that the claim to recover the earliest of the amounts paid by Mr Paciocco following charging of the late payment fee is statute barred. There will be no need to consider that argument. In the second of the appeals to this Court, in which the ultimate issue is whether the imposition of the late payment fee contravened one or more applicable statutory norms, the customers make a number of specific arguments which they say were lost in the compendious manner in which their statutory claims were dealt with in the Full Court. Those specific arguments are best left to be noted and addressed after setting out the analysis necessary to dispose of the first appeal. The holding in Andrews Andrews explained the term "penalty" to refer to punishment, consisting of the imposition of an additional or different contractual liability, for non- 145 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at observance of a "primary" contractual stipulation147. Thus, a penalty is a "collateral" stipulation "in the nature of a security for and in terrorem of the satisfaction of the primary stipulation"148. The precise holding in Andrews was reflected in the formal declaration made in that case149. The holding was that there is no reason in principle why the primary stipulation to which a penalty is collateral cannot consist of the occurrence or non-occurrence of an event which is neither a breach of contract nor another event which it is the responsibility or obligation of the party subjected to the penalty to avoid150. The question determined by that holding had quite recently been considered in and determined to the contrary in a decision of an intermediate court of appeal in Australia, which was overruled151. The question had not previously squarely arisen for the determination of this Court. The Supreme Court of the United Kingdom subsequently held in Cavendish Square Holding BV v Makdessi152 that only a detriment imposed on breach of contract can amount to a penalty. The common law of the United Kingdom has to that extent now taken a different path from the common law of Australia. This is not the occasion to critique the relative merits of the divergent contemporary approaches or to debate the competing perspectives on our common legal history which contributed to that divergence. There is need to respond only to the statement in Cavendish that Andrews involved "a radical departure from the previous understanding of the law"153. To the extent that the statement refers to the common law of Australia, the statement is wrong and appears to be based on a misunderstanding of Andrews. Andrews did nothing to disturb the settled understanding in Australia that a contractual provision imposing a penalty is unenforceable at common law 147 (2012) 247 CLR 205 at 216 [9], referring to Legione v Hateley (1983) 152 CLR 406 at 445; [1983] HCA 11. 148 (2012) 247 CLR 205 at 216 [10]. 149 (2012) 247 CLR 205 at 238-239. 150 (2012) 247 CLR 205 at 217 [12], 227 [45]-[46], 236 [78]. 151 Interstar Wholesale Finance Pty Ltd v Integral Home Loans Pty Ltd (2008) 257 ALR 292. 152 [2015] 3 WLR 1373; [2016] 2 All ER 519. 153 [2015] 3 WLR 1373 at 1396 [41]; [2016] 2 All ER 519 at 541. without the discretionary intervention of equity154. That proposition was accepted by at least three members of this Court in AMEV-UDC Finance Ltd v Austin155 and was the proposition on which the decision of the majority in that case pivoted. Andrews rejected the understanding that AMEV-UDC stood for the further and more sweeping proposition that "[t]he modern rule against penalties is a rule of law, not equity"156. Equitable jurisdiction to relieve against penalties, Andrews emphasised, has not been abolished. The statement of Mason and Wilson JJ in AMEV-UDC that "the equitable jurisdiction to relieve against penalties withered on the vine for the simple reason that, except perhaps in very unusual circumstances, it offered no prospect of relief which was not ordinarily available in proceedings to recover a stipulated sum or, alternatively, damages"157 was criticised, but only insofar as the statement might be taken to have drawn a causal link between the withering of the equitable jurisdiction to relieve against penalties and the advent of the Judicature system158. To fuse the administration of law and equity is not thereby to destroy an equitable doctrine, and for an equitable doctrine to wither is not necessarily for an equitable doctrine to die. Nothing in Andrews contradicts the fuller explanation given by Deane J in AMEV-UDC that "acceptance by the common law of the unenforceability of penalties largely removed the occasion for the exercise of the equitable jurisdiction to relieve against enforcement with the result that the terms upon which equity would grant such relief became ordinarily of but academic or historical interest"159. His Honour's explanation, with which Andrews is consistent, continued by pointing out that "[t]he equitable jurisdiction did not, however, cease to exist and the terms upon which equitable relief against penalties would be granted remain directly applicable in those comparatively rare cases in which the party asserting unenforceability is constrained to seek positive 154 Eg Citicorp Australia Ltd v Hendry (1985) 4 NSWLR 1 at 39-40. 155 (1986) 162 CLR 170 at 189, 191-192, 195; [1986] HCA 63. 156 (2012) 247 CLR 205 at 223 [31], quoting Interstar Wholesale Finance Pty Ltd v Integral Home Loans Pty Ltd (2008) 257 ALR 292 at 320 [99]. 157 (1986) 162 CLR 170 at 191. 158 (2012) 247 CLR 205 at 234 [68]. 159 (1986) 162 CLR 170 at 195. relief (whether primary or ancillary) which is purely equitable in character, such as an order for reconveyance"160. The statement in Andrews that "[i]t is the availability of compensation which generates the 'equity' upon which the court intervenes" without which "the parties are left to their legal rights and obligations"161 is, in context, a reference to the historically important, although now comparatively rare, exercise of equitable jurisdiction to grant relief against penalties. The statements that, "[i]n general terms", a penalty is enforced "only to the extent" that compensation can be made for prejudice suffered by failure of the primary stipulation and that a party who can provide compensation "is relieved to that degree from liability to satisfy the collateral stipulation"162 are similarly directed to, and broadly descriptive of, the grant of equitable relief. The present case does not involve the grant of equitable relief. Nor does the present case involve non-observance of a non-promissory primary contractual stipulation. The customers' claim to recover the amounts charged as, and paid following the imposition of, the late payment fee in the representative proceeding, although variously and elaborately framed, was in substance a common law action in restitution which turned on the enforceability at common law of an obligation to pay a specified sum of money on breach of contract. For present purposes, the significance of Andrews lies in its explanation of the conception of a penalty as a punishment for non-observance of a contractual stipulation, in its explanation of that conception of a penalty as a continuation of the conception which originated in equity, and in its endorsement of the description of the speech of Lord Dunedin in Dunlop as the "product of centuries of equity jurisprudence"163. The antecedents of Dunlop The ancient equitable antecedents of the speech of Lord Dunedin in Dunlop can be sufficiently picked up towards the end of the eighteenth century in England in the statement by Lord Thurlow in Sloman v Walter164 of the "rule", 160 (1986) 162 CLR 170 at 195. 161 (2012) 247 CLR 205 at 217 [11]. 162 (2012) 247 CLR 205 at 216-217 [10]. 163 (2012) 247 CLR 205 at 218 [15], citing Rossiter, Penalties and Forfeiture, (1992) 164 (1783) 1 Bro CC 418 at 419 [28 ER 1213 at 1214]. then "too strongly established in equity to be shaken", "that where a penalty is inserted merely to secure the enjoyment of a collateral object, the enjoyment of the object is considered as the principal intent of the deed, and the penalty only as accessional, and, therefore, only to secure the damage really incurred". Those equitable antecedents include the subsequent emphatic denials by Lord Eldon165 and Jessel MR166 that the equitable jurisdiction to relieve against a penalty was concerned to relieve a contracting party from the consequence of a collateral stipulation to pay an agreed sum of money on breach of contract merely on the basis that the amount contractually agreed was "excessive" or "oppressive". Before Dunlop, English courts experienced difficulty, rising at times to frustration, attempting to articulate the rationale for the rule stated by Lord Thurlow. To attempt to justify refusal to enforce a collateral stipulation solely on the ground that the refusal gave effect to the principal intention of the parties (that the principal contractual stipulation be observed) failed satisfactorily to explain why there should be a refusal to enforce the totality of the intention of the parties (including that the collateral stipulation also be observed). The difficulty was not shared in Scotland. There the Court of Session, "the supreme court of law and equity"167, adopted the position by at least the middle of the nineteenth century that "a penalty is a punishment" and that the reason for refusing to enforce a penalty was that "it is not legal to stipulate for punishment": to refuse to enforce a penalty was accordingly to give effect to a policy that "[p]arties cannot lawfully enter into an agreement that the one party shall be punished at the suit of the other"168. The Court of Session came, moreover, to accept that a contract which stipulated for the payment of an amount by way of "liquidated damages" was "not beyond an equitable control". The Court would "deny effect to the mere words of the instrument" if at the time of the contract the amount stipulated was "so utterly extravagant and unreasonable as to infer that, if awarded, it would not 165 Astley v Weldon (1801) 2 Bos & Pul 346 at 350-351 [126 ER 1318 at 1321]. 166 Wallis v Smith (1882) 21 Ch D 243 at 259-260. 167 Bell, Commentaries on the Law of Scotland, 7th ed (1870), vol 1 at 700, quoted in Cavendish [2015] 3 WLR 1373 at 1465 [252]; [2016] 2 All ER 519 at 607. 168 Craig v M'Beath (1863) 1 M 1020 at 1022. be proper damages, though so called, but would really amount to a penalty or punishment"169. The immediate context of Dunlop was provided by the decision of the House of Lords, on appeal from the Court of Session, in Clydebank Engineering and Shipbuilding Company v Yzquierdo y Castaneda170, as followed and explained in the judgment of the Privy Council in Public Works Commissioner v Hills171. Clydebank concerned contracts entered into in 1896 for the supply to the Spanish Government by a Clyde shipbuilding firm of four "torpedo-boat destroyers" to be delivered within a specified period of months. The contracts provided that "[t]he penalty for later delivery shall be at the rate of £500 per week for each vessel"172. At the time of contracting, the Spanish Government was attempting to suppress an insurrection in Cuba and feared the armed intervention of the United States. The Spanish Government brought, and was successful in, an action against the shipbuilding firm in the Court of Session to recover £500 per week for each week that the vessels were in fact delivered late. That Court rejected the shipbuilding firm's argument that the agreement to pay £500 per week was unenforceable because it was a penalty and that the recoverable loss of the Spanish Government for late delivery of each vessel was limited to "the actual outlay on the pay of the officers and crew through detention in Scotland waiting to take over the vessel, and other actual damages of that sort"173. The Lord Ordinary (Lord Kyllachy) stated at first instance the principle which he went on to apply174: "[T]hat in determining the true character of something called penalty, or something called liquidate damage, it was an important, and perhaps conclusive, consideration that the amount of the so-called penalty, or of 169 Forrest and Barr v Henderson, Coulborn, and Company (1869) 8 M 187 at 201. See also at 193, 198, 199, 203. 172 Yzquierdo y Castaneda v Clydebank Engineering and Shipbuilding Co Ltd (1903) 5 F 1016 at 1017. 173 (1903) 5 F 1016 at 1026. 174 (1903) 5 F 1016 at 1022. the so-called liquidated damage, was on the one hand reasonable and moderate, or on the other hand exorbitant and unconscionable. Prima facie of course the parties were the best judges of that matter. Still the amount stipulated might be such as to make it plain that it was merely stipulated in terrorem, and could not possibly have formed a genuine pre- estimate of probable or possible damage, or, to speak perhaps more correctly, a genuine pre-estimate of the creditor's probable or possible interest in the due performance of the principal obligation." Applying that principle in a factual context in which it was established that the price which the Spanish Government paid for the destroyers reflected a premium for early delivery, Lord Kyllachy concluded that the shipbuilding firm "failed to shew that the £500 per week stipulated was exorbitant and unconscionable"175. The Second Division of the Court of Session affirmed, and the appeal to the House of Lords was dismissed. The principle stated and applied by Lord Kyllachy can be seen to have been reflected in the reasoning of each member of the House of Lords176, and to have been adopted in terms by Lord Robertson when he said177: "Now the Court can only refuse to enforce performance of this pecuniary obligation if it appears that the payments specified were – I am using the language of Lord Kyllachy – 'merely stipulated in terrorem, and could not possibly have formed' 'a genuine pre-estimate of the creditor's probable or possible interest in the due performance of the principal obligation.'" Demonstrating the neutrality of legal principle in a time of war, the Supreme Court of the United States around two years later applied essentially the same process of reasoning in United States v Bethlehem Steel Company178 to conclude that a stipulation in a contract for the supply to the United States of armaments during the Spanish-American war, requiring the armaments supplier to pay a fixed amount for each day of late delivery, was not unenforceable as a penalty179. 175 (1903) 5 F 1016 at 1024. 176 [1905] AC 6 at 10, 16-17, 19. 177 [1905] AC 6 at 19. 179 205 US 105 at 118-119, 120-121 (1907), applying Sun Printing & Publishing Assn v Moore 183 US 642 (1901). In Hills, the Board of the Privy Council included Lord Dunedin and Lord Atkinson. The judgment of the Privy Council was delivered by Lord Dunedin. After referring to Clydebank as having been decided "according to the rules of a system of law where contract law is based directly on the civil law and where no complications in the matter of pleading had ever been introduced by the separation of common law and equity"180, Lord Dunedin said181: "The general principle to be deduced from that judgment seems to be this, that the criterion of whether a sum – be it called penalty or damages – is truly liquidated damages, and as such not to be interfered with by the Court, or is truly a penalty which covers the damage if proved, but does not assess it, is to be found in whether the sum stipulated for can or can not be regarded as a 'genuine pre-estimate of the creditor's probable or possible interest in the due performance of the principal obligation.' The indicia of this question will vary according to circumstances. Enormous disparity of the sum to any conceivable loss will point one way, while the fact of the payment being in terms proportionate to the loss will point the other. But the circumstances must be taken as a whole, and must be viewed as at the time the bargain was made." Months later, dissenting in the result but not in the identification of basal principle, O'Connor J explained in Lamson Store Service Co Ltd v Russell Wilkins & Sons Ltd182 that he applied to the facts of that case "the simple test suggested by Lord Dunedin, namely, whether the 'sum stipulated for can or can not be regarded as a genuine pre-estimate of the creditor's probable or possible interest in the due performance of the principal obligation'"183. The same test was applied by Isaacs J in Hamilton v Lethbridge184. Dunlop in perspective The litigation in Dunlop was fully explained in Andrews185. That explanation need not be repeated. The context of Clydebank and Hills sheds light on the reasoning in Dunlop in two important respects. 180 [1906] AC 368 at 375. 181 [1906] AC 368 at 375-376. 182 (1906) 4 CLR 672; [1906] HCA 87. 183 (1906) 4 CLR 672 at 689. See also at 681. 184 (1912) 14 CLR 236 at 264; [1912] HCA 20. 185 (2012) 247 CLR 205 at 234-236 [69]-[77]. First, the context of Clydebank and Hills explains the provenance and import of the language used by Lord Atkinson to formulate the conclusion that the stipulated amount in issue in Dunlop "was not stipulated for merely in terrorem, but was really and genuinely a pre-estimate of the appellants' probable or possible interest in the due performance of the contract"186. The language derives from Scots law. Its importance lies in its provision of a stable justification for the penalty doctrine founded in concepts of public policy conformable with the doctrine's equitable origins. The context thus adds weight to the observation in Andrews that in Dunlop "the critical issue, determined in favour of the appellant, was whether the sum agreed was commensurate with the interest protected by the bargain"187. Second, that context also explains the provenance and import of the language used by Lord Dunedin when, after stating that the relevant "branch of the law" had "been handled, and at no distant date" in Clydebank and Hills, he said that he chose to "content" himself with "stating succinctly the various propositions which [he thought were] deducible from the decisions which rank as authoritative"188. The enumerated propositions which followed were not rules of law. They were distillations of principle intended by Lord Dunedin to be consistent with the then recent statements of principle in both Clydebank and Hills. The second proposition enumerated by Lord Dunedin, for which he cited Clydebank, conformed precisely to the critical issue identified by Lord Atkinson in the manner of formulation of his conclusion. "The essence of a penalty", said Lord Dunedin, "is a payment of money stipulated as in terrorem of the offending party."189 Lord Dunedin immediately expressed the corollary in terms that "the essence of liquidated damages is a genuine covenanted pre-estimate of damage"190. That reference to "damage", as distinct from "damages", is significant. The "damage" to which Lord Dunedin referred corresponded to the consequence of non-realisation of what, echoing the words of Lord Kyllachy in Clydebank, Lord Dunedin himself had earlier described in Hills as "the creditor's probable or 186 [1915] AC 79 at 96. 187 (2012) 247 CLR 205 at 236 [75]. 188 [1915] AC 79 at 86. 189 [1915] AC 79 at 86. 190 [1915] AC 79 at 86. possible interest in the due performance of the principal obligation"191. It was not a reference to the extent to which the relevant interest of the creditor in the performance of the bargain would be able to be compensated by an award of unliquidated damages in an action for breach of contract at common law. The third proposition enumerated by Lord Dunedin, for which he again cited Clydebank, was that "[t]he question whether a sum stipulated is penalty or liquidated damages is a question of construction to be decided upon the terms and inherent circumstances of each particular contract, judged of as at the time of the making of the contract, not as at the time of the breach"192. Lord Dunedin evidently used the word "construction" to refer to something beyond the attribution of legal meaning193. He used it to encompass legal characterisation. His added reference to the "inherent circumstances of each particular contract", although not then the subject of further elaboration, was not, in light of Clydebank, confined to circumstances which bore only on the attribution of legal meaning but extended to all of the circumstances which bore on the objective resolution of the ultimate question of characterisation. The fourth proposition enumerated by Lord Dunedin was introduced as being "[t]o assist this task of construction", and amounted to a listing of what he had identified in Hills as "indicia" which would vary with the circumstances, which must always be taken as a whole. The indicia were inappropriately labelled in the course of argument in this Court as "rules 4(a), 4(b) and 4(c)". Viewed in their proper perspective, none can be understood as having the character or effect of an operative legal rule. The statement that a stipulated amount "will be held to be penalty if the sum stipulated for is extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to have followed from the breach"194 harked back to Lord Kyllachy's statement of principle in Clydebank. The statement that a stipulated amount "will be held to be a penalty if the breach consists only in not paying a sum of money, and the sum stipulated is a sum greater than the sum which ought to have been paid"195, was explained to be "truly a corollary to the last test"196. And the statement that a stipulated amount 191 [1906] AC 368 at 375-376. 192 [1915] AC 79 at 86-87. 193 Cf Chatenay v Brazilian Submarine Telegraph Company [1891] 1 QB 79 at 85. 194 [1915] AC 79 at 87. 195 [1915] AC 79 at 87. 196 [1915] AC 79 at 87. is a penalty "when 'a single lump sum is made payable by way of compensation, on the occurrence of one or more or all of several events, some of which may occasion serious and others but trifling damage'"197, was explained to be "a presumption (but no more)"198. The words "test" and "presumption" were evidently used to mean "indicia". They were not used to import either a legal criterion or a shift in the evidentiary or persuasive onus. That Lord Dunedin's fourth proposition amounted to no more than a listing of considerations which might indicate a payment of money to have been stipulated as in terrorem of an offending party is demonstrated by the circumstance that the only case cited by Lord Dunedin as an illustration of the second in fact had the features of all three of the indicia to which he referred. The case was Kemble v Farren199. There the relevant contract was between the manager of the Covent Garden Theatre and a comic actor under which the actor was to be paid just over £3 for each day that the theatre was open over the course of four theatre seasons. The contract obliged each party to comply with many covenants, and stipulated that each party pay £1000 on any breach of one of those covenants. The breach which led to the action in which the stipulation was held to be unenforceable at common law on the ground that it imposed a penalty was the actor's refusal to act for a second season. English cases in the nineteenth century had routinely contained statements which accepted that a larger sum payable only on a breach of a covenant to pay a smaller sum would be a penalty at law and in equity200. Lord Dunedin was saying that those statements were not, at least by the beginning of the twentieth century, to be understood as embodying a distinct legal rule. It is telling that the well-resourced parties in the present case failed to unearth a single instance of an English or Australian case decided before Dunlop (or afterwards and by reference to Dunlop) where a stipulated amount has been held to be a penalty solely on the basis that a breach of contract triggering the obligation to pay the amount consisted only in not paying a sum of money, and the sum stipulated was greater than that which ought to have been paid. The unintended consequence of lucidity is sometimes rigidity. Over the century after Dunlop, in the course of being "applied countless times in this and 197 [1915] AC 79 at 87. 198 [1915] AC 79 at 87. 199 (1829) 6 Bing 141 [130 ER 1234]. 200 Eg Thompson v Hudson (1869) LR 4 HL 1 at 15. other courts"201, Lord Dunedin's explication of principle came to acquire a quasi- statutory status. Unfortunately, that status sometimes obscured its essential meaning. In AMEV-UDC, after noting with reference to Clydebank and Dunlop the historic concept of an amount which was agreed to be paid on breach of contract being a penalty if it is "extravagant, exorbitant or unconscionable", Mason and "This concept has been eroded by more recent decisions which, in the interests of greater certainty, have struck down provisions for the payment of an agreed sum merely because it may be greater than the amount of damages which could possibly be awarded for the breach of contract in respect of which the agreed sum is to be paid". The more recent decisions to which their Honours referred were for the most part cases decided towards the middle of the twentieth century in the context of hire purchase agreements, before the advent of modern consumer protection legislation203. In terms subsequently to receive the unanimous endorsement of this Court in Ringrow204, Mason and Wilson JJ continued205: "However, there is much to be said for the view that the courts should return to the Clydebank and Dunlop concept, thereby allowing parties to a contract greater latitude in determining what their rights and liabilities will be, so that an agreed sum is only characterized as a penalty if it is out of all proportion to damage likely to be suffered as a result of breach". All of this demonstrates consistency with the equitable root of the penalty doctrine of the more contemporary explanation of its operation given by Diplock LJ in Robophone Facilities Ltd v Blank206. Diplock LJ said: 201 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 663 [12]; [2005] HCA 71. 202 (1986) 162 CLR 170 at 190. 203 Eg Cooden Engineering Co Ltd v Stanford [1953] 1 QB 86. 204 (2005) 224 CLR 656 at 669 [31]. 205 (1986) 162 CLR 170 at 190. 206 [1966] 1 WLR 1428 at 1446; [1966] 3 All ER 128 at 141-142. "[T]he parties to a contract may expressly stipulate not only what will be what I there called their primary obligations and rights under the contract, ie, those which are discharged by performance of the contract, but also what will be their secondary obligations and rights, ie, those which arise upon non-performance of any primary obligation by one of the parties to the contract. Of these secondary obligations and rights, the commonest is the obligation of the non-performer to make to the other party and the corresponding right of such other party to claim from the non-performer reparation in money for any loss sustained by the other party which results from the failure of the non-performer to perform his primary obligation." He continued: "But the right of parties to a contract to make such a stipulation is subject to the rule of public policy that the court will not enforce it against the party in breach if it is satisfied that the stipulated sum was not a genuine estimate of the loss likely to be sustained by the party not in breach, but was a sum in excess of such anticipated loss and thus, if exacted, would be in the nature of a penalty or punishment imposed upon the contract-breaker." Frankfurter J had written to substantially similar effect in Priebe & Sons Inc v United States207. He referred to the doctrine that "exactions for a breach of contract not giving rise to damages and merely serving as added pressure to carry out punctiliously the terms of a contract, are not enforced by courts". He said that he assumed that the "basic reason" for the doctrine was "that the infliction of punishment through courts is a function of society and should not inure to the benefit of individuals". Consistently with those observations of Diplock LJ and of Frankfurter J, after quoting with approval the observation of Mason and Wilson JJ in AMEV- UDC, this Court said in Ringrow208: "Exceptions from … freedom of contract require good reason to attract judicial intervention to set aside the bargains upon which parties of full capacity have agreed. That is why the law on penalties is, and is expressed to be, an exception from the general rule. It is why it is expressed in exceptional language. It explains why the propounded penalty must be judged 'extravagant and unconscionable in amount'. It is 207 332 US 407 at 417-418 (1947). 208 (2005) 224 CLR 656 at 669 [32]. See, to similar effect, Elsley v J G Collins Insurance Agencies Ltd [1978] 2 SCR 916 at 936-937; Philips Hong Kong Ltd v Attorney General of Hong Kong [1993] 1 HKLR 269 at 279. not enough that it should be lacking in proportion. It must be 'out of all proportion'." Framing the inquiry In O'Dea v Allstates Leasing System (WA) Pty Ltd209, Wilson J asked of the stipulation in issue in that case whether it "can be considered to be a 'genuine pre-estimate of the creditor's ... probable or possible interest in the due performance of the principal obligation'" (citing Hills) or "whether it is a penalty inserted 'merely to secure the enjoyment of a collateral object'" (citing Sloman v Walter). That succinct framing of the inquiry is consistent with Andrews and Dunlop. It is also very useful. The ultimate question of whether a stipulation imposing a detriment on a contracting party in the event of non-observance of another stipulation is a penalty is reflected in the formulation Wilson J drew from Sloman v Walter. To ask whether a stipulation serves merely to secure the enjoyment of a collateral object is to ask whether the conclusion objectively to be drawn from the totality of the circumstances is that the only purpose of the stipulation was to punish: to impose a detriment on a contracting party in the event that a principal contractual stipulation is not observed, in order to deter non-observance of that principal stipulation. To ask that question in the context of a stipulation for the payment of money on breach of contract accords with the statement of Lord Dunedin in Dunlop that "[t]he essence of a penalty is a payment of money stipulated as in terrorem of the offending party". The formulation Wilson J drew from Hills does not indicate some separate or different inquiry but rather indicates the nature of the inquiry involved in considering whether a stipulation has some purpose other than to punish. The formulation captures in positive and more elaborate terms what Lord Dunedin reflected in negative and cryptic terms when he added, as a reflex of the essence of a penalty, that "the essence" of a payment of money on breach of contract that is not a penalty is that the amount of the payment "is a genuine covenanted pre- estimate of damage". To ask whether a stipulated payment is a genuine pre- estimate of the innocent party's probable or possible interest in the due observance of the principal contractual stipulation is to ask whether an interest which the innocent party has in the observance of that principal stipulation explains the stipulation for payment as having a purpose other than to punish the offending party. Such an interest of the innocent party in the observance of a principal contractual stipulation need not be an interest in respect of which the offending party would otherwise be compelled to compensate the innocent party at law (or in equity) in the event of non-observance. 209 (1983) 152 CLR 359 at 383; [1983] HCA 3. Where the stipulated detriment is in the form of an obligation to pay a specified sum of money in the event of a breach of contract, a comparison of the specified sum with the amount of the unliquidated damages which might be expected to be recovered by the innocent party in an action for breach of contract will often be probative of whether the only purpose of the stipulation is to punish. Such a comparison might sometimes be decisive. Not always. The facts in Clydebank and Dunlop both sufficiently illustrate that interests of the innocent party beyond the protection of an award of unliquidated damages in the event of a breach of contract can justify a different conclusion. The protection afforded by the stipulation of an obligation to pay a specified sum of money in the event of a breach of contract might be to interests that the innocent party has in contractual performance which are intangible and unquantifiable. A party seeking contractually to protect its interests by insisting on a stipulation that another party pay a specified sum of money in the event of breach cannot be limited by considerations of common law causation of damage to protecting only against incremental loss that the party would sustain as the direct result of that breach. Nor can a party seeking contractually to protect that party's interests by insisting on such a stipulation be compelled by considerations of common law remoteness of damage to absorb actual damage to those interests consequential on breach merely because the nature and extent of that damage might not be apparent to the other party at the time of entering into the contract. The English Law Commission correctly observed in 1975 that "[t]here would seem to be no reason why the parties in Hadley v Baxendale210 could not have contracted for liquidated damages assessed on the footing that the mill would continue to be at a standstill"211. In that respect, another explanation given by Diplock LJ in Robophone is instructive212: "The basis of the defendant's liability for the enhanced loss under the 'second rule' in Hadley v Baxendale is his implied undertaking to the plaintiff to bear it. ... But such an undertaking need not be left to implication; it can be express. If the contract contained an express undertaking by the defendant to be responsible for all actual loss to the plaintiff occasioned by the defendant's breach, whatever that loss might 210 (1854) 9 Exch 341 [156 ER 145]. 211 The Law Commission, Penalty Clauses and Forfeiture of Monies Paid, Working Paper No 61, (1975) at 31 [42]. 212 [1966] 1 WLR 1428 at 1448; [1966] 3 All ER 128 at 143 (footnote omitted). turn out to be, it would not affect the defendant's liability for the loss actually sustained by the plaintiff that the defendant did not know of the special circumstances which were likely to cause any enhancement of the plaintiff's loss. And so if at the time of the contract the plaintiff informs the defendant that his loss in the event of a particular breach is likely to be £X by describing this sum as liquidated damages in the terms of his offer to contract, and the defendant expressly undertakes to pay £X to the plaintiff in the event of such breach ... [s]uch a clause is ... enforceable whether or not the defendant knows what are the special circumstances which make the loss likely to be £X rather than some lesser sum which it would be likely to be in the ordinary course of things." And as the facts in Clydebank and Dunlop again both sufficiently illustrate, the fact that the amount of a payment stipulated to be made on breach of contract is set at a level which provides a negative incentive – even a very strong negative incentive – to perform the contract is not enough to justify the conclusion that the stipulation served only to punish. The prospect of paying compensatory damages to be assessed by a court in the event of breach itself provides a negative incentive to perform a contract. The relevant indicator of punishment lies in the negative incentive to perform being so far out of proportion with the positive interest in performance that the negative incentive amounts to deterrence by threat of punishment. To accept the appropriateness of framing the inquiry in terms of whether the stipulation in issue is properly characterised as having no purpose other than to punish is to reject the suggestion, which originated with Lord Radcliffe in Bridge v Campbell Discount Co Ltd213, that the description of a penalty as a threat to be enforced in terrorem adds nothing to the requisite analysis. To the contrary, the description captures the essence of the conception to which the whole of the analysis is directed. Framing the inquiry in terms of whether the stipulation in issue is properly characterised as having no purpose other than to punish compels a more tailored inquiry into the commercial circumstances within which the parties entered into the contract containing the stipulation than might be involved in asking, as did the Supreme Court of the United Kingdom in Cavendish, whether the stipulation serves a "legitimate interest"214. That is not, of course, to say that the differently framed inquiries might not lead to the same result. 213 [1962] AC 600 at 622. 214 [2015] 3 WLR 1373 at 1392 [32]; [2016] 2 All ER 519 at 538; see also [2015] 3 WLR 1373 at 1435 [152]; [2016] 2 All ER 519 at 578-579. Was the late payment fee a penalty? The credit card contracts entered into between ANZ and Mr Paciocco were on terms and conditions relevantly no different from the terms and conditions on which ANZ entered into credit card contracts with each of the other holders of consumer credit card accounts, of which there were millions. The stipulation in each of those contracts for the charging and payment of the late payment fee in the event of non-observance by the account holder of the stipulation for payment of the minimum monthly payment by the due date was properly characterised as the imposition of an additional contractual liability by reason of non-observance of a primary contractual stipulation. The customers' claim that that additional contractual liability was unenforceable as a penalty triggered an inquiry whether, within the totality of the circumstances within which ANZ contracted with its consumer credit card account holders, the stipulation for the payment of the late payment fee was properly characterised as: having no purpose other than to punish an account holder in the event of late payment; or conversely serving the purpose of protecting ANZ's interests in ensuring that consumer credit card account holders made the minimum monthly payment by the due date. The customers bore the evidentiary and persuasive onus throughout that inquiry. That the primary contractual stipulation consisted only in the payment of money, and that the amount of the late payment fee did not vary according to the amount overdue or the length of delay in payment, were indicia which could not be ignored in considering the conclusion to be drawn in the totality of the circumstances. But each of those circumstances was only weakly indicative of the character of the late payment fee as a punishment, given that: the minimum monthly payment was to be payable monthly; the amount of the minimum monthly payment was calculated ordinarily to be a very small percentage of the closing balance of the account; the account holder could control the amount of the closing balance by self-regulating the timing and amount of credit card transactions; and the account holder could cancel the account at any time. The evidence of Mr Regan was not wholly irrelevant to the inquiry to be undertaken. That Mr Regan focused, ex post, on costs incurred by ANZ in consequence of late payment by Mr Paciocco was not of itself a reason for discounting the value of his evidence. As has been recognised in a variety of contexts, evidence of the later occurrence of an event can be probative of the earlier probability of that event occurring215. The danger to be avoided in 215 Eg Weldon v Union Trustee Co of Australia Ltd (1925) 36 CLR 165; [1925] HCA 14; Trustees Executors and Agency Co Ltd v Commissioner of Taxes (Vict) (1941) 65 CLR 33; [1941] HCA 18; Longworth v Commissioner of Stamp Duties (1953) 53 SR (NSW) 342. weighing evidence of that nature is that which has been described in behavioural science as "availability bias": the natural but flawed human tendency to treat events that occurred as having had a greater probability of occurrence simply because they occurred216. That was not a problem with Mr Regan's evidence. There was no reason to consider that, within the context of ANZ's ongoing provision of millions of consumer credit card accounts, the events which occurred during the operation of Mr Paciocco's credit card accounts were not indicative of the events which were foreseeable as likely to occur at the times the credit card contracts were entered between ANZ and Mr Paciocco. Nor is there any reason to consider that Mr Paciocco's circumstances were wholly unrepresentative of those of other account holders. What limited the utility of Mr Regan's evidence to the inquiry was the confinement of his attention to variable or incremental operational costs incurred within ANZ's Collections Business Unit. The calculations which Mr Regan performed would have been entirely appropriate to quantify the compensable loss to ANZ which flowed from each breach of the stipulation for payment of a minimum monthly payment by the due date. Those calculations alone were not sufficient to indicate the totality of ANZ's interests in ensuring that the stipulation for payment of a minimum monthly payment by the due date was observed. Turning from the evidence of Mr Regan to the evidence of Mr Inglis, that neither of the principal categories of costs which Mr Inglis identified in connection with late payment events would be compensable at the suit of ANZ against an individual customer may readily be accepted. As to provisioning costs, the amount to be recovered on a chose in action by the holder of that chose cannot possibly extend to a diminution in the value of the chose itself that is attributable to the potential for non-recovery. As to regulatory capital costs, those costs would plainly be too remote. Each of those two categories of costs nevertheless represented commercial interests which ANZ had in ensuring that its credit card customers, as a cohort, made minimum monthly payments by the due date. Provisioning costs directly affected recorded profit, and the costs of regulatory capital were a real outgoing. The primary judge was undoubtedly correct in describing provisioning costs and regulatory capital costs as part of the costs of running a bank in Australia. But ANZ was not confined by a principle of law to adopting a pricing strategy for its credit card products which involved cross-subsidisation. 216 Tversky and Kahneman, "Judgment under Uncertainty: Heuristics and Biases", (1974) 185 Science 1124. The calculations of Mr Inglis showed the commercial interests of ANZ in avoiding to be not grossly disproportionate to the amount of the late payment fee, even if operational costs were ignored. two principal categories of costs those Notwithstanding the attention given to them by the parties in argument in this Court, the costs of collection activities within ANZ's Collections Business Unit considered on an average basis were not particularly significant when compared with provisioning costs and regulatory capital costs. Although nothing of substance therefore turns on their precise quantification, ANZ obviously had a commercial interest in avoidance or minimisation of common costs and fixed costs associated with those collection activities in the same way as ANZ had an interest in avoidance or minimisation of the variable or incremental costs of those activities. The calculations of collection costs by Mr Inglis are for that reason for present purposes to be preferred to the calculations of Mr Regan. Although of little consequence in the scheme of things, it is worth noting a discrete argument concerning collection costs made on behalf of the customers for the first time in this Court. The argument is that those costs were recoverable by ANZ under the separate provisions of the standard form credit card contracts which provided for ANZ to recover "enforcement expenses" in the event of default. The answer to the argument is that the collection activities in question fell short of enforcement and were therefore beyond the scope of that separate provision. To include the recovery of the costs of those activities within the commercial interests of ANZ which were capable of providing a non-punitive justification for the stipulation for the late payment fee therefore involves no element of double counting. Each category of costs identified by Mr Inglis represented a commercial interest of ANZ in ensuring observance by its consumer credit card customers of the principal stipulation in each of their contracts for payment of the minimum monthly payment by the due date. The customers' grounds of appeal to this Court do not encompass any challenge to Mr Inglis' evidence of their quantification. In light of those interests, it cannot be concluded that the inclusion in the credit card contracts of the stipulation for charging and payment of the late payment fee properly had no purpose other than to punish the account holder in the event of late payment. The stipulation was not merely in terrorem; the late payment fee was not just a punishment. The Full Court was correct to conclude that the customers failed to demonstrate that the late payment fee was a penalty. The first appeal must for that reason be dismissed. Did ANZ contravene any applicable statutory norm? The customers' claims in the representative proceeding included that ANZ engaged in "unconscionable conduct" within the meaning of ss 12CB and 12CC of the Australian Securities and Investments Commission Act 2001 (Cth) ("the ASIC Act") and ss 8 and 8A of the Fair Trading Act 1999 (Vic) ("the FT Act") by entering into and implementing the standard contractual stipulation for the charging of the late payment fee. They claimed also that the credit card contracts were "unjust" within the meaning of s 76 of the National Credit Code in Sched 1 to the National Consumer Credit Protection Act 2009 (Cth) and "unfair" within the meaning of s 32W of the FT Act and s 12BG of the ASIC Act. ANZ did not dispute that it was bound in its dealings with consumer credit card customers by each of those statutory norms. Not all of those statutory norms were applicable throughout the period to which the customers' claims related, and those that were applicable were each the subject of amendment, but nothing turns on that detail. There was no substantial controversy between the parties as to the content of those norms. The controversy was as to their application. For the purposes of the second of the appeals to this Court, the customers accept that their argument that ANZ engaged in unconscionable conduct is no stronger insofar as it relies on the other and later statutory provisions than insofar as it relies on s 12CB of the ASIC Act in the form that section took until 1 January 2012217. Section 12CB then relevantly provided: "(1) A person must not, in trade or commerce, in connection with the supply or possible supply of financial services to a person, engage in conduct that is, in all the circumstances, unconscionable. (2) Without limiting the matters to which the court may have regard for the purpose of determining whether a person (the supplier) has contravened subsection (1) in connection with the supply or possible supply of services to a person (the consumer), the court may have regard to: the relative strengths of the bargaining positions of the supplier and the consumer; and (b) whether, as a result of conduct engaged in by the supplier, the consumer was required to comply with conditions that 217 Competition and Consumer Legislation Amendment Act 2011 (Cth). were not reasonably necessary for the protection of the legitimate interests of the supplier; and (c) whether the consumer was able to understand any documents relating to the supply or possible supply of the services; and (d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the consumer or a person acting on behalf of the consumer by the supplier or a person acting on behalf of the supplier in relation to the supply or possible supply of the services; and the amount for which, and the circumstances under which, the consumer could have acquired identical or equivalent services from a person other than the supplier. For the purpose of determining whether a person has contravened subsection (1) in connection with the supply or possible supply of financial services to another person: the court must not have regard to any circumstances that were not reasonably foreseeable at the time of the alleged contravention". The customers place the weight of their argument on s 12CB(2)(a) and (b) of the ASIC Act. They point out that the effect of those provisions is specifically to include, within the matters to which regard may be had for the purpose of determining whether ANZ (the supplier) contravened s 12CB(1) in connection with the supply of financial services to Mr Paciocco (the consumer), the relative strengths of the bargaining positions of ANZ and Mr Paciocco and "whether, as a result of conduct engaged in by [ANZ], [Mr Paciocco] was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of [ANZ]". The customers emphasise that the late payment fee was unilaterally set by ANZ in the context of standard form consumer contracts which were not open to negotiation by a customer. They go on to argue that the late payment fee charged to Mr Paciocco: "was not a price for any service being provided (but an amount payable upon breach of contract)"; "was not a genuine pre-estimate of loss agreed between the parties (on any ordinary understanding of those words)"; "was intended to secure the performance by [Mr Paciocco] of his contractual obligation to make timeous payment of monies borrowed"; and "resulted in windfall gains to [ANZ] by reason of the disparity between the level of the late payment fee and the actual loss sustained by [ANZ] by reason of the late payments of [Mr Paciocco]". in which terminology The value-laden the customers couch the characteristics of the late payment fee on which they rely for the conclusion that its imposition on Mr Paciocco was unconscionable implicitly incorporates conclusions about the legal operation and commercial context of the late payment fee which have already been rejected in the context of rejecting the customers' argument that the late payment fee was to be characterised as a penalty. It would be open to reject their argument concerning statutory unconscionability on the basis that they have failed to establish each of the argument's premises. The argument, however, has deeper problems. To the extent that the customers' argument relies on s 12CB(2)(b) of the ASIC Act, it is based on a misconstruction of that provision. The concern of s 12CB(2)(b) was not, in its primary operation, with the substantive content of a condition with which a consumer was required to comply but rather with conduct on the part of the supplier as a result of which the consumer was required to comply with that condition. Section 12CB(2)(b) was not enlivened, and therefore raised no question about whether or not a condition with which a consumer was required to comply was reasonably necessary for the protection of the legitimate interests of the supplier, unless a requirement on the part of the consumer to comply with a condition was brought about by conduct on the part of the supplier. ANZ did not cause Mr Paciocco to enter into credit card contracts which contained what was, in the language of s 12CB(2)(b) of the ASIC Act, the "condition" for the late payment fee; it presented him with standard form contracts on a take-it-or-leave-it basis. And ANZ did not cause Mr Paciocco to fail to make minimum monthly payments as a result of which he became subject to the requirement to pay the late payment fee in compliance with that condition. There was, in short, no conduct on the part of ANZ which enlivened the operation of s 12CB(2)(b). More significantly, in focusing on s 12CB(2)(a) and (b), the customers' argument implicitly overstates the significance of those provisions within the overall scheme of s 12CB of the ASIC Act. The statutory question raised by the customers' claim that ANZ engaged in unconscionable conduct within the meaning of s 12CB(1) of the ASIC Act when it entered into and then implemented its standard contractual stipulation for the charging of the late payment fee to Mr Paciocco was whether that conduct was objectively to be characterised as "unconscionable" according to the ordinary meaning of that term, requiring as it does a "high level of moral obloquy" on the part of the person said to have acted unconscionably218. The answer to that question necessarily turned on a consideration of that conduct in the context of what s 12CB(1) described as "all the circumstances". The word "may" in s 12CB(2) of the ASIC Act was not permissive, but conditional. The import of s 12CB(2) was to spell out that circumstances relevant to the determination of whether conduct was objectively to be characterised as "unconscionable" according to the ordinary meaning of that term might or might not include, in respect of particular conduct, all or any of the particular matters referred to in s 12CB(2). The provision made clear that, where any one or more of those matters existed in respect of particular conduct, each of those extant matters was to form part of the totality of the circumstances mandatorily to be taken into account for the purpose of determining the statutory question posed by s 12CB(1). The provision did not leave it open to a consumer who alleged that conduct of a supplier was in breach of s 12CB(1) to pick and choose. The customers could not choose to rely on matters referred to in s 12CB(2)(a) and (b), yet to ignore matters referred to in s 12CB(2)(c), (d) and The existence and amount of the late payment fee were disclosed to Mr Paciocco in the letters, booklets and telephone calls which he received from ANZ. He was able to, and did, understand them. There has never been any suggestion of undue influence or pressure having been exerted on him or of unfair tactics having been used against him. Mr Paciocco freely chose to enter into the two credit card contracts with ANZ and could have terminated those contracts at any time at will. He could at any time have sought to obtain a credit card from another bank. Other banks were in fact charging broadly equivalent fees. Mr Paciocco chose instead to maintain his accounts with ANZ, to manage those accounts at close to their limits and to bear the risk of being charged the late payment fee on those occasions when he failed to comply with the standard stipulation to make the minimum monthly payment by the due date. Taking all those circumstances into account, even if it were accepted that charging Mr Paciocco the late payment fee resulted in windfall gains to ANZ (which, on the evidence of Mr Inglis, it is to be concluded that ANZ did not obtain), the proper conclusion still to be drawn would be that ANZ did not engage in unconscionable conduct within the meaning of s 12CB(1) of the ASIC Act when it entered into and then implemented its standard contractual stipulation for the charging of the late payment fee to Mr Paciocco. That conclusion makes it unnecessary separately to consider the other and later 218 Attorney General (NSW) v World Best Holdings Ltd (2005) 63 NSWLR 557 at 583 statutory provisions on which the customers relied in making their statutory unconscionability claim. The customers' argument that the standard contractual stipulation for the charging of the late payment fee resulted in the two credit card contracts between Mr Paciocco and ANZ being "unjust" within the meaning of s 76 of the National Credit Code mirrors their statutory unconscionability argument in structure and content. The argument must suffer the same fate, for substantially the same reasons. Section 76(1) of the National Credit Code permitted a court, on the application of a debtor, to "reopen" a transaction that gave rise to a relevant credit contract if satisfied that, at the time it was entered into, the contract was "unjust" – an expression defined for that purpose to include "unconscionable, harsh or oppressive". On reopening the contract, the court was empowered by s 77(b) to make orders which included relieving the debtor from payment of any amount in excess of such amount as the court, having regard to the risk involved and all other circumstances, considered to be reasonably payable. Section 76(2) of the National Credit Code provided that, in determining whether a term of a particular credit contract was unjust in the circumstances relating to it at the time it was entered into, a court was "to have regard to the public interest and to all the circumstances of the case". Section 76(2) added that the court "may" have regard to a long list of specifically enumerated factors, the last of which was expressed to be "any other relevant factor". One of those factors, enumerated as s 76(2)(e), was "whether or not any of the provisions of the contract ... impose[d] conditions that [were] ... not reasonably necessary for the protection of the legitimate interests of a party to the contract". That factor differed from the factor enumerated in s 12CB(2)(b) of the ASIC Act in that it was concerned in its primary operation with the substantive content of the contract in question. Section 76(4) was similar to s 12CB(4)(a) of the ASIC Act in prohibiting a court from considering "injustice arising from circumstances that were not reasonably foreseeable when the contract ... was entered into". Having regard to the evidence of Mr Inglis quantifying the average costs incurred by ANZ in connection with the occurrence of an event giving rise to an entitlement to charge the late payment fee as having been in excess of $35 or $50, it could not be concluded that the conditions of Mr Paciocco's credit card contracts which imposed the late payment fee of either $35 or $20 were not reasonably necessary for the protection of the legitimate interests of ANZ. The factor enumerated in s 76(2)(e) was for that reason not shown to be engaged. But, again, even if it were to be accepted that charging Mr Paciocco the late payment fee resulted in windfall gains to ANZ (which on the evidence of Mr Inglis it did not), that would not be enough to justify the conclusion that the credit card contracts were unjust. Section 76(2) made clear that a conclusion about whether a contract was unjust could only be drawn having regard to all of the circumstances of the case. The customers identified no element of the public interest which might bear on the evaluation required by s 76(2) of the National Credit Code beyond considerations of public interest which inhere in any evaluation of whether conduct is unconscionable, harsh or oppressive. When regard is had to all the circumstances of the case, it could not be concluded that the standard contractual stipulation for the charging of the late payment fee resulted in the two credit card contracts between Mr Paciocco and ANZ being "unjust" for essentially the same reasons that it could not be concluded that ANZ's entering into and implementation of that standard contractual stipulation was "unconscionable". The customers' argument focusing on the "unfair" limb of s 32W of the FT Act is a variation on the same theme, and must again meet the same fate. They do not suggest that the argument would yield a different result were it to be focused on s 12BG of the ASIC Act. Section 32Y of the FT Act provided that "[a]n unfair term in a consumer contract is void". The meaning of the expression "unfair term" was addressed in s 32W as follows: "A term in a consumer contract is to be regarded as unfair if, in all the circumstances, it causes a significant imbalance in the parties' rights and obligations arising under the contract to the detriment of the consumer." Section 32W needed to be read with s 32X, which went on to provide that "[w]ithout limiting section 32W, in determining whether a term of a consumer contract is unfair, a court ... may take into account, among other matters, whether the term was individually negotiated" and "whether the term has the object or effect of", amongst other things, "penalising the consumer but not the supplier for a breach or termination of the contract". Tailoring their more general statutory arguments to the language of s 32W, the customers argue that the contractual stipulation for charging the late payment fee caused a significant imbalance in the rights and obligations of ANZ and of Mr Paciocco under the credit card contracts, to the detriment of Mr Paciocco as the consumer. That was because ANZ was put "in a situation where it [could] profit from breaches of contract by the consumer without any quid pro quo". The significance of that imbalance, they argue, was "demonstrated by the lack of any meaningful relationship between the amount of the late payment fee and the reasonably foreseeable loss which would result to [ANZ] from late payment". One answer to the argument is that its minor premise has not been established: there was a meaningful relationship between the amount of the late payment fee and the accrual of costs to ANZ from the occurrence of late payment events and that those costs were reasonably foreseeable at the time of contracting. The evidence of Mr Inglis showed that relationship. The more complete answer to the argument is that its major premise is flawed. To demonstrate that the stipulation for payment put ANZ in a situation where it might profit from breaches of contract by a credit card customer without the customer in breach acquiring something in return would not alone be sufficient to allow it to be concluded that the stipulation caused a significant imbalance in the parties' rights and obligations arising under the contract. Even if the stipulation could be characterised as a matter of ordinary language as "penalising the consumer but not the supplier for a breach or termination of the contract", that was only one factor amongst many to be taken into account. The Full Court was correct to conclude that the customers failed to demonstrate that the contractual stipulation to pay the late payment fee contravened any of the applicable statutory norms. The second appeal must for that reason be dismissed. Orders Both appeals should be dismissed with costs. 204 KEANE J. These appeals concern late payment fees charged by the respondent, Australia and New Zealand Banking Group Limited ("ANZ"), in connection with two credit card accounts held by the first appellant, Mr Lucio Robert Paciocco. Mr Paciocco and the second appellant, Speedy Development Group Pty Ltd ("SDG"), brought an action against ANZ in the Federal Court of Australia as a representative proceeding under Pt IVA of the Federal Court of Australia Act 1976 (Cth). They claimed relief in respect of a range of fees charged in connection with Mr Paciocco's credit card accounts, a consumer deposit account held by Mr Paciocco, and a business deposit account held by SDG. At trial, those fees were referred to by the primary judge (Gordon J) compendiously as "exception fees". The appellants claimed that the exception fees were unenforceable as penalties; alternatively, the exception fees contravened standards set by a number of statutory regimes which protect consumers against "unconscionable conduct", "unjust transactions" and "unfair contract terms". that charging they claimed The primary judge held that only the exception fees charged in connection with Mr Paciocco's credit card accounts, which her Honour referred to as "late payment fees", were unenforceable as penalties. The primary judge did not consider whether the late payment fees breached any of the statutory regimes on which the appellants relied219. As to the alleged breaches of the statutory provisions in respect of the other exception fees, the primary judge dismissed the appellants' claims. ANZ appealed to the Full Court of the Federal Court against the primary judge's decision that the late payment fees were penalties. The appellants appealed against the primary judge's decision in relation to the other exception fees. The Full Court allowed ANZ's appeal, and dismissed the appellants' appeal. The appellants appeal to this Court pursuant to a grant of special leave220. There are two appeals before this Court. The issue that arises for determination in appeal M219 of 2015 is whether the late payment fees charged by ANZ contravened the proscriptive statutory regimes referred to above. The issue in appeal M220 of 2015 is whether those fees are unenforceable as penalties under the general law. It is convenient to refer to the claims in appeal M219 as "the statutory claims", and to the claims in appeal M220 as "the penalty claims". 219 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 220 11 September 2015 per Kiefel and Nettle JJ. For the reasons that follow, the issues in the two appeals should be determined adversely to the appellants and the appeals should be dismissed. By a notice of contention filed in appeal M220 of 2015, ANZ argued that the appellants' claims to recover late payment fees incurred more than six years before proceedings were commenced are time-barred by the operation of the Limitation of Actions Act 1958 (Vic). Because the late payment fees were not penalties, it is not necessary to resolve this issue. The penalty claims It is convenient to deal first with the issue of whether ANZ's late payment fees were unenforceable penalties under the general law. In that regard, some general observations by way of an overview of the appellants' case are necessary. First, it is necessary to be clear as to what the case is not about. The appellants did not advance a case that the late payment fees were a manifestation of an unlawful abuse by ANZ of its market power. No attempt was made to advance a case to that effect221 under Pt IV of the Competition and Consumer Act 2010 (Cth). No attempt was made to advance a case of misconduct in contravention of any of the provisions of Div 2 of Pt 7.10 of the Corporations Act 2001 (Cth). Accordingly, it should be understood that a rejection of the case which the appellants did advance does not mean that there is no limit to the extent of fees and charges that banks might lawfully charge. Such a concern might be met by invoking laws which are directed to prevent the abuse of market power or dishonest conduct in the market. Secondly, it was no part of the appellants' case that the charges by ANZ or other banks for their financial services should be fixed by the courts at reasonable levels. There are obvious difficulties inherent in determining what level of interest and charges would be "reasonable". In any event, no jurisdiction to make such a determination has been conferred on the courts. That said, the medieval laws against usury serve as a reminder that such laws have been tried in the past222. But currently in Australia, no legislation authorises the application by the courts of a standard of reasonableness to determine the lawfulness of bank charges; and it is not suggested that the common law has developed such a standard. 221 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 222 Biancalana, "Contractual Penalties in the King's Court 1260-1360", (2005) 64 Cambridge Law Journal 212. Thirdly, the appellants did not advance a case that Mr Paciocco suffered from the kind of disability which attracts the intervention of a court of equity to protect the weaker party to a contract223. The strength of the appellants' case lies solely in the finding by the primary judge that the cost actually incurred by ANZ in consequence of each failure by Mr Paciocco to pay his credit card account on time was of the order of $3224. That amount can be contrasted with the amount of the late payment fee actually charged by ANZ: initially $35 and later $20. The large disparity between the late payment fee charged by ANZ and the expenses actually incurred by it in each case of late payment is the focus of the appellants' case. That disparity may well mean that the late payment fee could accurately be characterised as an example of profiteering by the bank. But whether a late payment fee is to be characterised as an unenforceable penalty is not to be determined by asking whether the enforcement of the fee will produce profits, even large profits, for the bank. The case advanced by the appellants was that the late payment fee was to be characterised as a penalty because its purpose was to punish Mr Paciocco for breaching his contractual obligation to make timely payment or to deter him from choosing not to perform his contractual obligation. And the appellants sought to make this case good by evidence which showed that the late payment fee exceeded the expenses actually incurred by ANZ on each occasion of default by Mr Paciocco. The disparity was said to be so great that the late payment fee could be seen to be out of all proportion to the bank's interest in recovering the expenses actually incurred by it. To argue from these premises that the contractual purpose which characterised the late payment fee charged by ANZ was the punishment of its customers is fraught with difficulty once it is accepted that the bank's legitimate interests are not confined to the reimbursement of the expenses directly occasioned by the customer's default. The maintenance or even enhancement of ANZ's revenue stream, for the purpose of making a profit, is one explanation of the late payment fee. Indeed, it is the most obvious explanation because, generally speaking, it is the purpose which informs all the terms on which a bank makes its facilities available to its customers. And although interest payments are the primary source of reward to a bank for financial risks involved in the provision of financial accommodation to its customers, there is no legal reason why a bank's fees and charges may not serve the same purpose. In short, the late payment fee is readily characterised by the purpose of ensuring that ANZ's revenues are maintained at the level of profitability required by its shareholders. 223 cf Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447 at 474-475; [1983] HCA 14; Kakavas v Crown Melbourne Ltd (2013) 250 CLR 392 at 424-425 [117]; [2013] HCA 25. 224 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at And the appellants did not seek to advance a case that the pursuit of this level of profitability was itself, in some way, not legitimate. That the contractual purpose of the late payment fee was neither to punish late payment by Mr Paciocco nor to deter him from paying late can be seen by reflecting on the circumstance, noted by Allsop CJ225 in the Full Court, that the appellants "chose to run their affairs by risking the fees". There was no suggestion at all by the appellants that the exercise of that choice was forced on them by any circumstance beyond their control. Indeed, it was a choice from which Mr Paciocco could expect to derive some benefit if he was prepared, as he evidently was, to accept the risk that ANZ might terminate his accounts if it did not wish to retain his business. By choosing to incur the fees, Mr Paciocco made a rational decision to deploy his available funds to meet other claims on his resources. The rationality of that choice suggests that the amount of the fee was relatively modest, in that it was not of sufficient magnitude as to make the choice inconvenient for him as a matter of business. Alternatively, if Mr Paciocco actually had insufficient funds available to meet his payment obligations to ANZ, his choice to pay the bank late meant that he avoided the transaction costs, and the inconvenience (and probably higher interest rates), which he would have incurred had he chosen to arrange an alternative source of finance to enable him to make timely payment of the amount owing on the credit card account. There was no suggestion that Mr Paciocco was, for any reason, unlikely to be able to make such arrangements had it been in his own interests to do so. On either of these two scenarios, there is no reason to regard Mr Paciocco's choice to incur the fee as other than a rational economic choice on his part. A voluntary and self-interested choice of this kind is the opposite of the rational response which one might expect to be generated by a penal provision, given that the characteristic purpose of a penalty is to deter non-compliance. Given the importance of the values of commercial certainty and freedom of contract226 in the law, the courts will not lightly invalidate a contractual provision for an agreed payment on the ground that it has the character of a punishment. The existence of legislation such as that invoked to support the statutory claims made by the appellants means that it cannot be said that "an 225 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 282 [336]. See also Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 313 [304]. 226 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 669 [31]-[32]; [2005] HCA 71. untrammelled 'freedom of contract' provide[s] a universal legal value"227. But in the application of common law rules, the maintenance of freedom of contract is of abiding importance, subject, of course, to statute. Thus, in AMEV-UDC Finance Ltd v Austin228, Mason and Wilson JJ said: "The courts should not … be too ready to find the requisite degree of disproportion lest they impinge on the parties' freedom to settle for themselves the rights and liabilities following a breach of contract." Only in cases where gross disproportion is such as to point to a predominant punitive purpose have agreed payments payable on breach of contract been struck down as penalties. Thus, for example, where that purpose is not discernible because the evaluation and assessment of the loss covered by the agreed payment is "very expensive and very difficult … to calculate precisely", the penalty rule has been held to have no application229. It may be that other laws concerned with the unfair or unreasonable use of superior bargaining power will affect the validity of the provision; but, subject to such laws, the penalty rule is not engaged by a provision which achieves a profit for the promisee at the expense of the promisor. That is because, if the provision is not distinctly punitive in its character, the penalty rule does not operate to displace the parties' freedom to settle for themselves the contractual allocation of benefits and burdens and the rights and liabilities following a breach of contract. The leading case of Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd230, upon which the appellants principally relied, was itself a case where a clause providing for an agreed payment on any breach was upheld. Dunlop does not encourage invalidating provisions the purpose of which can objectively be seen to be the protection of the legitimate interests of one contracting party against default by the other. Nor does Dunlop suggest a narrow view of what interests may legitimately be protected by a provision for an agreed payment. It is certainly inconsistent with the notion that a contracting party's 227 Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 at 216 [5]; [2012] HCA 30. 228 (1986) 162 CLR 170 at 193-194; [1986] HCA 63. 229 Waterside Workers' Federation of Australia v Stewart (1919) 27 CLR 119 at 132, see also at 128-129; [1919] HCA 63. See also Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205 at 217 [11]. legitimate interests go no further than the performance of the principal terms of the contract231. Finally by way of overview of the appellants' case, the level of interest charged by a bank, while reflecting market forces, may also be affected by the extent to which other means are deployed to cover the risks of the provision of financial accommodation and reward the bank for taking those risks. In this way, the rate of interest demanded of each customer might be expected, other things being equal, to be lower because an enforceable promise is taken from each customer to pay a late payment fee. Such a fee serves to reduce the overall risk assumed by the bank in providing the card facility to its mass of customers and to ensure the level of profitability acceptable to the bank's shareholders. The appellants' claim involves the disturbing irony that, if the challenge to the validity of the late payment fee were to succeed, it could be expected to have the consequence that the cost of financial accommodation to all customers, including those who honour their contractual engagements, will be increased in order to maintain ANZ's revenue streams at a level unaffected by the proscription of the late payment fee. ANZ could be expected to seek to ensure that its revenue streams are maintained; and its evident market power is such that there is no reason to doubt that it would succeed, at least to a large extent, in achieving that end. It was accepted that Mr Paciocco would not have received better terms from ANZ's competitors in the market. This state of affairs is consistent with the oligopolistic character of the market. Accordingly, if the late payment fees (which were relatively uniform among ANZ and its competitors) are unenforceable, interest rates or other charges could be expected to rise at the expense of those customers who adhere to their contractual engagements. That might not be thought to be a good thing. But however that may be, the mere prospect of such a consequence illustrates the danger of pressing the penalty rule into service for a purpose for which it is ill-adapted. Background Mr Paciocco opened the first credit card account in June 2006, with a credit limit of $15,000, which was increased to $18,000 in November 2009. Mr Paciocco opened the second credit card account in July 2009 with a credit limit of $4,000. It will be convenient to refer to Mr Paciocco's two credit card accounts as "the card accounts". 231 [1915] AC 79 at 91-93, 99. See also Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1430-1431 [135]-[138]; [2016] 2 All ER 519 at 574-575. The terms and conditions of the card accounts (set out in various contractual documents identified by the primary judge232) provided that an account holder was required to pay a minimum monthly payment plus any other amount immediately due by a certain date shown on the account holder's statement of account. Until December 2009, that date was within 28 days of the end of a statement period. From December 2009, that date was the "due date" on the statement of account. Interest was charged at a rate of 12.24 per cent on the outstanding amount if the full balance of the card account was not paid by the due date shown on the statement of account. The obligation to pay a minimum monthly amount was the primary payment stipulation in favour of ANZ. Until December 2009, in the event that the minimum monthly payment and any other amount immediately due were not paid within 28 days of the end of the statement period, a late payment fee of $35 was charged to the account holder's account. From December 2009, a late payment fee of $20 was charged to the account holder's account in the event that the minimum monthly payment and any other amount immediately due were not paid by the "due date". Until December 2009, eight late payment fees were charged to the card accounts. From December 2009, 18 late payment fees were charged to the card accounts. The decision of the primary judge The primary judge made a number of findings about the circumstances of Mr Paciocco's entry into the contracts for the card accounts. These findings have an important bearing upon both the penalty claims and the statutory claims. First, the terms of the card accounts "were contained in printed forms, which [Mr Paciocco] had no opportunity to negotiate."233 Secondly, at the time the card accounts were established, other banks charged late payment fees similar to that required by ANZ234. 232 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 233 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 234 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at It was common ground that ANZ determined the quantum of the late payment fees and that it did not determine that quantum by reference to a sum that would have been recoverable as unliquidated damages235. The primary judge held that the contractual stipulation for a fee to be charged if the amount shown on the statement of account was not paid by a certain date was collateral to the primary stipulation in favour of ANZ that Mr Paciocco make a minimum monthly payment by a due date236. The primary judge concluded that at law and in equity, the collateral stipulation was to be viewed as security for, or in terrorem of, the satisfaction of the primary stipulation237. Her Honour stated the test whether such a stipulation was a penalty under the general law as follows238: "[A] stipulation (to pay a sum or other property) will not constitute a penalty at law or in equity unless it is 'extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved'239". Her Honour held that the evidence of Mr Inglis, an expert witness called by ANZ, did not assist in the application of that test because it reflected a "theoretical accounting" exercise240. Mr Inglis was instructed to assess the maximum amount of costs that ANZ could conceivably have incurred as a result of late payments241. Mr Inglis attempted to assess the cost of collecting the unpaid debt, the cost to ANZ of increasing its provisions for the greater risk of 235 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 236 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 237 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 238 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 239 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 240 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 241 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at late payment or non-payment or default in repayment by Mr Paciocco and the opportunity costs associated with the need to meet regulations relating to the bank's capital reserves. The primary judge held that "increase in loss provisions" and "increase in the costs of regulatory capital" were not loss or damage suffered as a result of Mr Paciocco's late payments242. This was said to be because those matters were too remote to be compensable as loss or damage caused by the late payment. As her Honour put it243: "provisions and regulatory capital are part of the costs of running a bank in Australia. No increase in them can be directly or indirectly related to any of the late payments by Mr Paciocco. As the [appellants] submitted, there are many cases each year by banks against customers and guarantors where the principal debtor has defaulted. In those cases, the banks seek damages limited to the sums outstanding, enforcement costs and interests. No one has suggested that a bank would be entitled to recover an increase in provisioning or the cost of its regulatory capital." On the other hand, the appellants' expert, Mr Regan, had been instructed to identify the damage actually suffered by ANZ as a result of the late payments by Mr Paciocco and the amounts needed to restore ANZ to the position it would have been in had the late payments not occurred244. The primary judge adopted Mr Regan's methodology245 and found that, while the actual loss suffered by ANZ as a result of the late payments could not be precisely determined, it was probably no more than $3 per late payment event; and, on any view, considerably less than $35 or $20246. On that basis, the primary judge concluded that the late payment fees were extravagant and unconscionable and therefore penalties247. 242 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 243 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 244 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 245 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 246 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 247 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at The decision of the Full Court The principal judgment in the Full Court was written by Allsop CJ, with whom Besanko and Middleton JJ agreed generally in separate judgments248. Allsop CJ held that the primary judge erred in conflating two enquiries249: "the anterior enquiry as to whether the provision is penal in character; and the later enquiry as to the remedial consequence of any such characterisation." Allsop CJ said that the two enquiries were separate, and that250: "one looks forward and is referable to the time of entry into the contract and the extent of the legitimate interest of the obligee in the performance of the relevant provision of the contract; the other looks backwards to see what damage has been demonstrated to have been caused by the breach or failure of the relevant provision in order to found some relief for such breach or failure." Accordingly, identifying the primary judge's error, Allsop CJ said that251: "to the extent that the primary judge is to be taken to have undertaken an ex post enquiry of actual damage as a step in assessing whether the prima facie penal character of the late payment fee was rebutted (as a reading of all the reasons requires) her Honour, in my respectful view, was wrong." Allsop CJ held that, in assessing whether a stipulation is a penalty, "the correct approach [is] to look at the greatest possible loss on a forward looking basis"252. As his Honour explained253: 248 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 249 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 250 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 251 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 252 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 253 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at "The question as to whether [a stipulation] is penal is to be assessed by reference to the question whether it is extravagant or exorbitant by reference to the obligee's legitimate interest in the performance of the contract assessed by the greatest loss that could conceivably be proved to have followed from a breach or failure to comply." The Full Court regarded Mr Regan's evidence of the damage actually suffered by ANZ as a result of the late payments by Mr Paciocco as irrelevant to the question whether the late payment fees were extravagant and unconscionable by reference to the greatest loss that could conceivably be proved to have followed from the breach254. Allsop CJ said that the enquiry undertaken to answer that question "is not assisted by knowing what the damages from [the late payments] were."255 Rather, the Full Court regarded Mr Inglis' forward-looking approach as correct256. The Full Court accepted Mr Inglis' evidence as identifying three categories of cost which might conceivably be incurred as a result of late payment. First, ANZ was required to take up a loss provision on its profit and loss account when customers fail to meet a monthly repayment obligation on a credit card account257. Secondly, it was required to hold regulatory capital sufficient to cover unexpected losses: as the risk of non-recovery of its loan assets increases, as upon the failure of an account holder to make a minimum monthly payment, the amount of regulatory capital that ANZ is required to hold increases258. Thirdly, there was the cost of collection activity to recover the amounts due when a customer fails to meet a monthly payment259. The Full Court held, contrary to the primary judge, that it was appropriate to take into account the three categories of costs in assessing the extravagance or otherwise 254 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 255 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 256 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 257 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 258 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 259 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at of the late payment fees because they were "legitimate business cost[s]" and "part of the costs of running a bank"260. It is apparent that the Full Court resolved the difference between the evidence of Mr Inglis and Mr Regan without descending into close consideration of the accuracy of the calculations made by either witness. The primary judge rejected Mr Inglis' estimate as a theoretical calculation unconstrained by the rules which limit the damages recoverable by suit for breach of contract, while the Full Court proceeded on the basis that the exercise performed by Mr Inglis was to be preferred, being the exercise required to indicate the greatest loss that could conceivably be proved to have followed from the breach, an exercise which was none the worse for being "theoretical". The difference between the Full Court and the primary judge turned on the question whether this theoretical exercise was consistent with the penalty rule's test of the character of a stipulation. The Full Court was not invited to reject Mr Inglis' approach on the basis that his calculations were unreliable. To the extent that the appellants' argument in this Court sought to advance such a contention, it should not be entertained. The Full Court cannot be said to have erred in failing to accept an argument that was not put to it; and, in any event, even if one puts Mr Inglis' calculations to one side, Mr Regan's evidence does not support the conclusion that the late payment fee was a penalty. Mr Regan's evidence proceeds on too narrow a view of the legitimate interests of ANZ protected by the late payment fee. If the expert evidence on either side does not show that the late payment fee was so far out of proportion to the effect upon the legitimate interests associated with the bank's business that its purpose was punitive, then the appellants' case must fail. For the sake of completeness, it should be noted that Allsop CJ also dealt261 with the admission by ANZ in its amended defence that: "ANZ did not determine the quantum of each [of the late payment fees] by reference to a sum that would have been recoverable as unliquidated damages." Allsop CJ held that an admission that the fee was not, in fact, a pre-estimate of the sum which might have been recovered as damages for breach did not necessarily mean that the fee in question was a penalty; that determination could only be made in light of all of the "contemporaneous acts 260 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 261 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at and approaches" of the parties to the relevant contract262. It may be said immediately that the Full Court was clearly correct in this regard. As was said in Cavendish Square Holding BV v Makdessi263 by Lord Neuberger of Abbotsbury PSC and Lord Sumption JSC: "[T]he penal character of a clause depends on its purpose, which is ordinarily an inference from its effect. … [T]his is a question of construction, to which evidence of the commercial background is of course relevant in the ordinary way. But, for the same reason, the answer cannot depend on evidence of actual intention264." To say, as did Lord Dunedin in Dunlop, that the question whether a provision is a penalty is a question of contractual "construction"265 is to say that the question is one of identifying the legal character of the provision from the effect of its terms in the commercial context in which it is to operate. The characterisation of a stipulation as a "genuine covenanted pre-estimate of damage"266 is a legal question which does not depend upon an evidentiary enquiry into the parties' motivation or subjective intention, purpose or calculations. As Deane J observed in O'Dea v Allstates Leasing System (WA) Pty Ltd267, a payment stipulation may be characterised as a penalty notwithstanding that the parties "subjectively intended to make a pre-estimate of damages in the event of breach." The appellants' submissions as to penalty The appellants argued that the Full Court erred in assessing the greatest loss that ANZ could conceivably have suffered as a result of the late payments by taking into account heads of loss that would not be compensable at law in an action for damages for breach of contract. In this regard, the appellants 262 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 263 [2015] 3 WLR 1373 at 1391 [28]; [2016] 2 All ER 519 at 536. 264 See Chartbrook Ltd v Persimmon Homes Ltd [2009] AC 1101 at 1115-1123 [28]-[47] per Lord Hoffmann. 265 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 266 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 267 (1983) 152 CLR 359 at 400; [1983] HCA 3. contended that the Full Court erred in holding that evidence of the actual damage suffered by ANZ was irrelevant to whether the late payment fees were penalties; and in holding that some of the costs said to have been incurred by ANZ as a result of the late payments were relevant to the assessment of whether the late payment fees were penalties. As to the first of these contentions, it may be accepted that evidence of the actual costs incurred by ANZ by reason of the late payments was not irrelevant. Mr Regan's evidence may have assisted in making the case that the late payment fees did not reflect a genuine pre-estimate of damage if the scope of that exercise were confined to the recoupment of the expenditures necessitated by each particular default. But to show what ANZ actually spent on each occasion of default by Mr Paciocco is not to show what damage might conceivably have been suffered to the interests ANZ was entitled to protect. The second of the appellants' contentions should not be accepted because the view advanced by the appellants of the legitimate interests that ANZ may seek to protect by the late payment fee is too narrow. The acceptance of such a view would broaden the scope of the penalty rule to encompass provisions which are outside its rationale. The penalty rule: a rule in search of a rationale The penalty rule is of ancient but somewhat uncertain origin. In Cavendish Square268, Lord Neuberger and Lord Sumption, following the view of Professor Simpson269, identified the origin of the penalty rule in the "equitable jurisdiction to relieve from defeasible bonds." The concern of equity was that no more should be recovered from the defaulting party than was necessary to ensure that the innocent party's interest in performance was not diminished. On that approach, a provision which was ancillary to or security for the "substance" of the transaction would not be enforced in equity so long as a defaulting party seeking relief was ready, willing and able to perform the substance of that party's obligations. As Lord Macclesfield said in Peachy v Duke of Somerset270, equitable relief was founded on "the original intent of the case, where the penalty is designed only to secure money, and the Court gives him all that he expected or desired". 268 [2015] 3 WLR 1373 at 1380-1382 [4]-[6]; [2016] 2 All ER 519 at 526-527. 269 Simpson, "The Penal Bond with Conditional Defeasance", (1966) 82 Law Quarterly Review 392 at 418-419. 270 (1721) 1 Strange 447 at 453 [93 ER 626 at 630]. An ancillary or security provision could not be enforced in equity at all to the extent that it went beyond the substance of the transaction. In the 17th and 18th centuries, the courts of common law sought to obviate the need for separate proceedings in Chancery by adopting the penalty rule. As Tindal CJ observed in Smith v Bond271, this process was assisted by legislation whose object was to "take away the necessity of applying for relief to a court of equity"272. Since the work of Professor Simpson to which Lord Neuberger and Lord Sumption referred in Cavendish Square, Professor Biancalana273 has traced the common law's engagement with penalty clauses back to the 13th century, noting that the penalty rule originated as an aspect of the jurisdictional tussle between the ecclesiastical courts and the courts of common law. According to Professor Biancalana, the common law courts were, at first, disposed to uphold penalty clauses as lawful, but by the turn of the 14th century had come to regard them as objectionable on the basis that they were a form of usury, which was unacceptable to medieval Christianity. It may also be said that the development of the law reflecting the Church's disapproval of usury was aligned with the economic interests of the dominant political class, the landed aristocracy, who, asset rich but cash poor, were chronically disinclined to keep their contractual engagements to those who had the recurring misfortune to have lent them money274. Some modern statements of the penalty rule are couched in terms of robust commerciality rather than in terms of a concern about usurious charges by lenders or the nice adjustments of equity. In Ringrow Pty Ltd v BP Australia Pty Ltd275, this Court, in a unanimous judgment, said: "The law of contract normally upholds the freedom of parties, with no relevant disability, to agree upon the terms of their future relationships. ... 271 (1833) 10 Bing 125 at 131 [131 ER 853 at 855]. 272 Waterside Workers' Federation of Australia v Stewart (1919) 27 CLR 119 at 273 Biancalana, "Contractual Penalties in the King's Court 1260-1360", (2005) 64 Cambridge Law Journal 212. 274 It is of some significance in this regard that cll 10 and 11 of Magna Carta were expressly directed to protecting the rights of barons against attempts by the barons' creditors to enforce their rights. 275 (2005) 224 CLR 656 at 669 [31]-[32]. Exceptions from that freedom of contract require good reason to attract judicial intervention to set aside the bargains upon which parties of full capacity have agreed. That is why the law on penalties is, and is expressed to be, an exception from the general rule. It is why it is expressed in exceptional language. It explains why the propounded penalty must be judged 'extravagant and unconscionable in amount'. It is not enough that it should be lacking in proportion. It must be 'out of all proportion'." This passage emphasises that the rule against penalties operates as an exception to the primacy otherwise accorded to considerations of certainty and freedom of contract where neither party is under a relevant disability. And the exceptional nature of the rule, in turn, invites close scrutiny of its rationale. Medieval religious scruples against usury associated with a primitive agrarian economy do not provide a satisfactory basis on which the penalty rule might now be sustained. Nor is the function of the penalty rule adequately explained by the concerns which led courts of equity to make adjustments to ensure that both parties obtained what equity saw as the "substance" of their transaction and no more in cases within its jurisdiction276. The Supreme Court of the United Kingdom in Cavendish Square277 conceived of the penalty rule as serving a purpose which stands apart from its equitable roots. According to Lord Neuberger and Lord Sumption, the rule against penalties operates on grounds other than that the putative penalty clause is regarded as a "matter of substance" as mere security for the performance of a principal obligation. As their Lordships explained278: "Because [clauses which provided for payment of a specified sum in place of common law damages] were a contractual substitute for common law damages, they could not in any meaningful sense be regarded as a mere security for their payment." In Andrews v Australia and New Zealand Banking Group Ltd279, this Court was not concerned with the late payment fee, but with other exception fees which were not charged upon breach by the customer. Given the issues before it, the Court, not surprisingly, stated the penalty rule in terms which reflect the 276 Jobson v Johnson [1989] 1 WLR 1026 at 1034-1035, 1039; [1989] 1 All ER 621 at 277 [2015] 3 WLR 1373 at 1392 [31]; [2016] 2 All ER 519 at 537-538. 278 [2015] 3 WLR 1373 at 1382 [8]; [2016] 2 All ER 519 at 528. 279 (2012) 247 CLR 205. ongoing influence of its equitable origins in cases where the impugned payment is charged otherwise than upon breach of contract280, and held that the penalty rule may operate in the absence of a breach of contract. On that point, this Court's decision in Andrews was not followed by the Supreme Court of the United Kingdom in Cavendish Square. But that difference does not matter, either for the resolution of this case, which is a case of breach of contract, or for the identification of the rationale for the operation of the penalty rule in a case of breach of contract. The real objection, as a matter of public policy, to a penalty clause which operates upon breach of contract is that it is no part of the law of contract to allow one party to punish the other for non-performance281. On that point, this Court and the Supreme Court of the United Kingdom are in accord. Courts of common law have long exercised the power to award exemplary damages to punish a tortfeasor in certain circumstances282; but the courts have consistently refused to countenance the enforcement of attempts to impose punishment by contract as a sanction for non-performance or to threaten such punishment283. As Lord Hoffmann said in Co-operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd284: "the purpose of the law of contract is not to punish wrongdoing but to satisfy the expectations of the party entitled to performance." Earlier, in Dunlop285, Lord Parmoor had described a penalty as a "sum inserted as a punishment on the defaulter"; and in Australia in Legione v Hateley286, Mason and Deane JJ described a penalty as a punishment for 280 (2012) 247 CLR 205 at 216-217 [10]. 281 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1392 [31], 1434 [148], 1466 [254], 1473 [291]; [2016] 2 All ER 519 at 537-538, 577-578, 608, 282 Fontin v Katapodis (1962) 108 CLR 177; [1962] HCA 63; Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118; [1966] HCA 40; XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985) 155 CLR 448; [1985] HCA 12; Lamb v Cotogno (1987) 164 CLR 1; [1987] HCA 47. 283 O'Dea v Allstates Leasing System (WA) Pty Ltd (1983) 152 CLR 359; Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1466 [254], 1473-1474 [291]-[293]; [2016] 2 All ER 519 at 608, 614-615. 284 [1998] AC 1 at 15. 285 [1915] AC 79 at 100. 286 (1983) 152 CLR 406 at 445; [1983] HCA 11. non-observance of a contractual provision by the imposition of an additional or different liability. That description was approved in the unanimous judgment of this Court in Andrews287. Similarly, in Cavendish Square288, Lord Neuberger and Lord Sumption said of the observation in Legione by Mason and Deane JJ: "[I]n so far as it refers to 'punishment' and 'an additional or different liability' as opposed to 'in terrorem' and 'genuine pre-estimate of loss', this definition seems to us to get closer to the concept of a penalty than any other definition we have seen. The real question when a contractual provision is challenged as a penalty is whether it is penal, not whether it is a pre-estimate of loss. These are not natural opposites or mutually exclusive categories." To similar effect, this Court in Ringrow289 rejected the suggestion that the impugned provision must be proportional to the legitimate commercial interests of the party relying upon it in order to avoid being characterised as a penalty. It is only where the impugned provision requires a payment upon breach which is out of all proportion to the legitimate commercial interests of the party relying upon it that the punitive character of the provision stands revealed. "In terrorem" Courts of equity regarded a collateral provision designed to provide an incentive to perform a principal obligation as objectionable on the ground that its enforcement was unnecessary to give the promisee the benefit of the substance of the transaction. Such a collateral provision might be described as operating "in terrorem", because of its evident tendency to deter the promisor from non-performance. In Campbell Discount Co Ltd v Bridge290, Lord Radcliffe said in relation to the use of the phrase "in terrorem" as identifying a purpose characteristic of a penalty: "I do not myself think that it helps to identify a penalty, to describe it as in the nature of a threat 'to be enforced in terrorem' … I do not find that that 287 (2012) 247 CLR 205 at 216 [9]. 288 [2015] 3 WLR 1373 at 1392 [31]; [2016] 2 All ER 519 at 537-538. 289 (2005) 224 CLR 656 at 667-669 [27]-[32]. 290 [1962] AC 600 at 622. See also Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1390-1391 [28], 1431-1432 [140]-[141]; [2016] 2 All ER 519 at description adds anything of substance to the idea conveyed by the word 'penalty' itself, and it obscures the fact that penalties may quite readily be undertaken by parties who are not in the least terrorised by the prospect of having to pay them and yet are, as I understand it, entitled to claim the protection of the court when they are called upon to make good their promises." On the other hand, if one regards the function of the penalty rule as being to preclude contracting parties from imposing punishment for breach of contract, it is not difficult to accept that a clause which has a deterrent effect by virtue of the prospect of punishment with which it confronts a defaulting promisor should be characterised as a penalty. In this sense, it may not be unhelpful to use the phrase "in terrorem". Dunlop revisited The preceding discussion of the rationale of the penalty rule affords a contemporary framework for a discussion of Lord Dunedin's statements in Dunlop291 upon which the appellants' case was based. Lord Dunedin was concerned to offer guidance in drawing the distinction between an agreed payment and a penalty. His Lordship said: The essence of a penalty is a payment of money stipulated as in terrorem of the offending party; the essence of liquidated damages is a genuine covenanted pre-estimate of damage. The question whether a sum stipulated is penalty or liquidated damages is a question of construction to be decided upon the terms and inherent circumstances of each particular contract, judged of as at the time of the making of the contract, not as at the time of the breach. To assist this task of construction various tests have been suggested, which if applicable to the case under consideration may prove helpful, or even conclusive. Such are: It will be held to be penalty if the sum stipulated for is extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to have followed from the breach. It will be held to be a penalty if the breach consists only in not paying a sum of money, and the sum stipulated is a sum greater than the sum which ought to have been paid. … 291 [1915] AC 79 at 86-87. There is a presumption (but no more) that it is penalty when 'a single lump sum is made payable by way of compensation, on the occurrence of one or more or all of several events, some of which may occasion serious and others but trifling damage'. On the other hand: It is no obstacle to the sum stipulated being a genuine pre- estimate of damage, that the consequences of the breach are such as to make precise pre-estimation almost an impossibility. On the contrary, that is just the situation when it is probable that pre-estimated damage was the true bargain between the parties." (citations omitted) Four points may be made here in relation to his Lordship's propositions. First, it is to be noted that proposition 4(b) harks back to the classic case of a bond upon condition to secure the payment of a lesser sum by a covenant to pay a greater sum. The more general run of cases, where breach engages an is addressed by Lord Dunedin's obligation proposition 4(a). That this is so may also be seen by reference to the observations of Lord Parmoor in Dunlop. His Lordship said292: to pay a specified sum, "There are two instances in which the Court has interfered when the agreed sum is referable to the breach of a single stipulation. ... The agreed sum, though described in the contract as liquidated damages, is held to be a penalty if it is extravagant or unconscionable in relation to any possible amount of damages the contemplation of the parties at the time when the contract was made. ... that could have been within The second instance in which the Courts have sanctioned interference is in the case of a covenant for a fixed sum, or for a sum definitely ascertainable, and where a inserted by arrangement between the parties, payable as liquidated damages in default of payment. Since the damage for the breach of covenant is in such cases by English law capable of exact definition, the substitution of a larger sum as liquidated damages is regarded, not as a pre-estimate of damage, but as a penalty in the nature of a penal payment." larger sum The late payment fee is not within Lord Parmoor's "second instance" or Lord Dunedin's proposition 4(b). As Allsop CJ noted293, "[t]he fee may or may 292 [1915] AC 79 at 101-102. 293 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at not, in fact, be greater than the sum due; [but] that does not appear on the face of the provision, or from an understanding of the facts." Thus, the late payment fee was not necessarily a demand for payment of a larger sum upon failure to pay a smaller sum. rely upon Lord Dunedin's proposition 4(b) is out of step, not only with the rationale of the penalty rule applicable proposition 4(a), not proposition 4(b), on which the appellants' case must depend. in cases of breach of contract, but with authority. The appellants' attempt Secondly, as Mason CJ and Wilson J observed in Hungerfords v Walker294, "legal and economic thinking about the remoteness of financial and economic loss have developed markedly in recent times." This observation has much force. It was only in that case, decided in 1989, that Australian jurisprudence finally accepted the (now obvious) economic reality that to be kept out of money due is to suffer real economic loss so that damages should be recoverable in tort for loss of the use of money295. More recent decisions have recognised the nature of the consequences for a lender of a default by a borrower in a payment obligation, and that these consequences extend beyond the mere fact of non-payment of the sum due on the due date296. In Lordsvale Finance Plc v Bank of Zambia297, Colman J observed that: "the borrower in default is not the same credit risk as the prospective borrower with whom the loan agreement was first negotiated. … [M]oney is more expensive for a less good credit risk than for a good credit risk". The common law's relatively recent acceptance of the economic reality that risky credit is more expensive credit has been accompanied by an appreciation of the nature of the relationship between the greater financial risk assumed by a bank by reason of late payments by customers and the costs to the bank's revenue stream associated with that increased risk. In short, if the adverse effects of late payment upon the bank's revenue stream are not covered by a late payment fee, those expenses can be expected to be covered by other charges, or 294 (1989) 171 CLR 125 at 146; [1989] HCA 8. 295 (1989) 171 CLR 125 at 146, 152. 296 Lordsvale Finance Plc v Bank of Zambia [1996] QB 752 at 763-764; Cine Bes Filmcilik ve Yapimcilik v United International Pictures [2004] 1 CLC 401 at 409-410 [13]; Beil v Mansell (No 2) [2006] 2 Qd R 499 at 508 [35]-[37]; Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1389-1391 [26]-[28], 1433-1434 [146]-[148], 1473 [291]; [2016] 2 All ER 519 at 535-536, 297 [1996] QB 752 at 763. by way of higher interest rates, imposed across the class of bank customers who use the same lending facility as the contract breaker. In this regard, in the United States, the Court of Appeals for the Second Circuit in Citibank NA v Nyland (CF8) Ltd298, referring to earlier authority in that Court which rejected the assertion that an uplift in interest rates upon default was a penalty, said: "[D]ebtors might fare worse … if creditors were not allowed to impose variable rates, because creditors would then impose higher rates for the full life of the loan in order to reallocate the risk." Thirdly, à propos of Lord Dunedin's proposition 4(c), which states a "presumption" (albeit a weak one) that a single lump sum payable on the occurrence of one of several breaches of differing levels of seriousness is a penalty, it may be said that Mr Paciocco's choice to run his affairs by risking the fees affords a practical demonstration that the fixed quantum of the fee was sufficiently modest in amount that it was not apt, in the circumstances of its contemplated operation, to have an effect in terrorem of Mr Paciocco. It is useful here to refer, by way of analogy, to ParkingEye Ltd v Beavis (Consumers' Association intervening)299. In that case, the Supreme Court of the United Kingdom upheld the validity of a provision with the effect that the maximum permitted stay in the defendant's shopping centre car park was two hours with free parking during that period, but that £85 would be charged to those who stayed if paid within 14 days. Lord Neuberger and Lord Sumption held that300: longer, reducible "although [the car park operator] was not liable to suffer loss as a result of overstaying motorists, it had a legitimate interest in charging them which extended beyond the recovery of any loss." Overstaying motorists reduced the parking spaces available to other customers of the retail outlets in the shopping centre. That created a situation which was apt adversely to affect the goodwill of the business of the operator of the car park by inconveniencing other users of the car park as would-be customers of the shopping centre301. Their Lordships drew the inference that 298 878 F 2d 620 at 625 (2nd Cir 1989) citing Ruskin v Griffiths 269 F 2d 827 at 832 (2nd Cir 1959). 299 Reported with Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373; [2016] 2 All ER 519. 300 [2015] 3 WLR 1373 at 1414 [99]; [2016] 2 All ER 519 at 558. 301 [2015] 3 WLR 1373 at 1414 [99]; [2016] 2 All ER 519 at 558-559. overstayers "must regard the risk of having to pay £85 for overstaying as an acceptable price for the convenience of parking there."302 In the present case, as noted above, Mr Paciocco freely risked incurring the late payment fee as a matter of his own convenience. It can be inferred that having to pay the fee was, in the commercial context in which the fee was to operate, an acceptable cost of avoiding the expense and inconvenience of meeting his obligations as to timely payment of his account. That such an inference is available as to the operation of the provision in its commercial context is inconsistent with a purpose of punishment for breach. in Lord Dunedin's proposition 4(a) are not used Fourthly, Lord Dunedin's summary was meant as a guide303 to the application of the rule. His Lordship's propositions were not intended to be applied as if they were the provisions of a statute. The terms "extravagant" and "unconscionable" contradistinction to reasonable, much less as free-standing criteria of invalidity. In proposition 4(a), the terms "extravagant" and "unconscionable" function as pointers towards the punitive purpose which imbues the challenged provision with the character of a punishment. And as Lord Neuberger and Lord Sumption said in Cavendish Square304, "the real question" is whether the impugned provision "is penal, not whether it is a pre-estimate of loss." In Cavendish Square305, Lord Neuberger and Lord Sumption accepted that, although there was "a case" for judicial abrogation of the penalty rule on the ground that it is "antiquated, anomalous and unnecessary, especially in the light of the growing importance of statutory regulation", the penalty rule should be retained because it serves the useful purpose of preventing a party from exercising a remedy where "the adverse impact of [the remedy] on the defaulter innocent party."306 significantly exceeds any Lord Neuberger and Lord Sumption considered that the courts can avoid inappropriate application of the penalty rule307: interest of legitimate the 302 [2015] 3 WLR 1373 at 1415 [100]; [2016] 2 All ER 519 at 559. 303 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 304 [2015] 3 WLR 1373 at 1392 [31]; [2016] 2 All ER 519 at 538. 305 [2015] 3 WLR 1373 at 1394-1395 [36]-[38]; [2016] 2 All ER 519 at 539-540. 306 [2015] 3 WLR 1373 at 1391 [29]; [2016] 2 All ER 519 at 536. 307 [2015] 3 WLR 1373 at 1395 [39]; [2016] 2 All ER 519 at 540. "(i) by [proceeding upon] a realistic appraisal of the substance of contractual provisions operating on breach, and (ii) by taking a more principled approach to the interests that may properly be protected by the terms of the parties' agreement." In Andrews, this Court summarised308 the "critical issue" as being "whether the sum agreed was commensurate with the interest protected by the bargain." This Court's discussion in Andrews309 of the decision in Dunlop focused upon the reasons of Lord Atkinson310, who accepted that an agreed payment upon breach should not be unenforceable where, though it "appeared imprecise as a pre-estimate of damage, it protected the [seller's] interest in preventing undercutting, which would disorganise its trading system"311. Accordingly, the question to be addressed in order to distinguish a penalty from a provision protective of a legitimate interest is312: "whether the sum or remedy stipulated as a consequence of a breach of contract is exorbitant or unconscionable when regard is had to the innocent party's interest in the performance of the contract." ANZ's legitimate interest It may be accepted immediately that a bank, like any other party to a contract, has no legitimate interest in punishing its customers for their defaults or in threatening them with punishment in order to discipline their behaviour. But a bank has a multi-faceted interest in the timely performance of its customers' obligations as to payment. The legitimate interest of ANZ protected by the late payment fee cannot be apprehended without an understanding of the commercial context in which that interest requires protection. It is an awkward irony of the appellants' case that, in a class action representing many claimants unified in their assertion that 308 (2012) 247 CLR 205 at 236 [75]. 309 (2012) 247 CLR 205 at 234-236 [69]-[77]. 310 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 311 (2012) 247 CLR 205 at 236 [75]. 312 Cavendish Square Holding BV v Makdessi [2015] 3 WLR 1373 at 1466 [255], see also at 1391 [28], 1473 [291], [292]; [2016] 2 All ER 519 at 608, see also at 536, this aspect of the contract of adhesion313 made by each of them with the bank is unenforceable as a penalty, the appellants' focus was upon the individual contract between Mr Paciocco and ANZ. Lord Dunedin in Dunlop314 recognised that the supposedly penal character of the operation of a contractual term must be understood by reference to the "inherent circumstances" in which it is to operate. In the present case, those circumstances include the fact that ANZ is a bank engaged in providing financial accommodation by way of bank card facilities to many customers on standard terms. The agreement, common to each customer, to pay the late payment fee required by ANZ was an aspect of ANZ's business which enabled the bank to provide accommodation to each customer. The fixing of risk and reward on each side of each transaction reflected the circumstance that it was one of many transactions and that the very multiplicity of these transactions was a factor bearing upon the pricing of each facility to each of many customers. The circumstance that the value of an increase in credit risk may be difficult to assess is a consideration which tends against an affirmative conclusion that the stipulation is to be characterised as a punishment. That consideration gains added force where the creditor is a bank which, as such, is exposed to the risk that many borrowers may default at one time in circumstances unforeseen at the time of the original arrangements. One aspect of ANZ's interest is obvious as an ordinary aspect of the business of a bank. Because of the relationship between the financial risks assumed by a lender and the cost of the facility to customers, the economic effect of provisions calculated to secure the protection of the bank by a late payment clause cannot be viewed in isolation from other elements of the cost of the facility to borrowers, such as interest. The Supreme Court of the United States in Smiley v Citibank (South Dakota) NA315 held that late payment fees charged by a bank on its credit card accounts were not unenforceable penalties. The case turned upon the Court's acceptance of the bank's argument that the late payment fees could be characterised as "interest" which the bank was permitted to charge under what the Court regarded as an ambiguous provision of the National Bank Act of 1864. 313 Kessler, "Contracts of Adhesion – Some Thoughts About Freedom of Contract", (1943) 43 Columbia Law Review 629. 314 [1915] AC 79 at 87-88. The Court held316 that it was reasonable to interpret the statutory term "interest" as including: "any payment compensating a creditor … for an extension of credit … or any default or breach by a borrower of a condition upon which credit was extended. It includes, among other things, the following fees connected with credit extension or availability: numerical periodic rates, late fees, not sufficient funds … fees, overlimit fees, annual fees, cash advance fees, and membership fees." The Court held that it was317: "perfectly possible to draw a line … between (1) 'payment compensating a creditor or prospective creditor for an extension of credit, making available of a line of credit, or any default or breach by a borrower of a condition upon which credit was extended,' and (2) all other payments. To be sure, in the broadest sense all payments connected in any way with the loan – including reimbursement of the lender's costs in processing the application, insuring the loan, and appraising the collateral – can be regarded as 'compensating [the] creditor for [the] extension of credit.' But it seems to us quite possible and rational to distinguish … between those charges that are specifically assigned to such expenses and those that are assessed for simply making the loan, or for the borrower's default." Underpinning the Supreme Court's liberal construction of the statute regulating bank lending is an appreciation that a late payment fee is part of the compensation for the risk assumed by the bank in making the facility available to the customer; "compensation" in this discourse being used, not in the sense of making good a loss, but in the sense of reward for risk. Maintaining or enhancing that reward is part of the legitimate business of a bank. Another legitimate interest which is an ordinary aspect of the business of a bank is the freedom the bank obtains, by timely repayment by its customers, to pursue more profitably its business of lending to its customers than would be the case if it is constrained to take into account the effect of defaulting customers upon its revenues. This interest is not limited to the loss of the opportunity to profit by re-investing funds paid late. If a bank's customers comprised only borrowers who paid on time in accordance with their contractual arrangements, the bank's freedom from the risks associated with late payment would enable it to maximise its revenues by reducing the cost of its facilities to all its customers in order to secure more customers and hence higher revenues. Some lenders may 316 517 US 735 at 740 (1996). 317 517 US 735 at 741-742 (1996) (emphasis in original). seek to improve their profits by deliberately soliciting the business of chronic defaulters, but it would be distinctly naïve to think that those borrowers would not be required to pay for a less attractive credit rating by higher interest rates. Accordingly, it is worth reiterating that even if one were to put the evidence of Mr Inglis to one side, the evidence of Mr Regan would not support the conclusion that the late payment fee was punitive in character. Mr Regan's evidence was not apt to demonstrate the gross disproportion required to establish the punitive character of the late payment fee because it did not address the full range of ANZ's legitimate interests protected by the late payment fee. Further, for reasons now to be discussed, the primary judge erred in treating characterisation of the late payment fee as turning upon a comparison between the quantum of the fee and the amount that might have been recovered in an action for damages. Pre-estimate of damage or recoverable damages The appellants argued that the Full Court misapplied Lord Dunedin's proposition 4(a). They noted that the expression used in Dunlop – "the greatest loss that could conceivably be proved to have followed from the breach" – speaks only of damages recoverable by action in consequence of a breach of contract and not of loss which is too remote to be compensated by an award of damages. The appellants' submission was that it is not the case that any set of circumstances resulting in loss that might be hypothesised can be taken into account in assessing whether a clause is penal. The appellants submitted that the primary judge was correct to reject ANZ's submission that "increase in loss provisions" and "increase in the cost of regulatory capital" were losses incurred as a result of late payment and to conclude that these matters were too remote to form part of compensable damage318. The appellants also argued that, to the extent that the Full Court held that collection costs exceeding the amount of the late payment fee could be taken into account, that finding should be set aside. It is not the case that authoritative formulations of the test of punitive extravagance are invariably stated in terms of a comparison between the impugned payment and what might be recovered by litigation. This Court said in Ringrow319: 318 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 319 (2005) 224 CLR 656 at 662 [10]. "The law of penalties, in its standard application, is attracted where a contract stipulates that on breach the contract-breaker will pay an agreed sum which exceeds what can be regarded as a genuine pre-estimate of the damage likely to be caused by the breach." It will be noted that this formulation of the rule does not depend upon a demonstration of the quantum of damages which would be recovered in an action. To speak of damage, as opposed to damages, is to speak of the loss caused by the breach, not the remedy which might be awarded by a court320. To speak of a "genuine pre-estimate of the damage" is to speak of the damage liable to be suffered by those parts of the bank's legitimate business interest that it is trying to protect. A genuine pre-estimate of that damage may encompass items of loss actually suffered, albeit too remote to be compensable by way of damages by virtue of the rules in Hadley v Baxendale321. An agreement for the recovery of such loss is consistent with the absence of a punitive purpose. For a party to stipulate for a more ample remedy than is available at law is not to visit a punishment on the other party. An agreed provision avoids the uncertainty and expense of litigation. The benefit of such a provision to both parties and to the legal system is obvious. Even in medieval times, the authority we know as Bracton considered that a clause providing for the payment of an agreed sum upon a breach of contract served the legitimate purpose of removing the uncertainty and expense of litigation involved in establishing the quantum of damages recoverable for a breach of contract322. In summary as to appeal M220 of 2015, the appellants' claim that the late payment fees were penalties fails. I turn to consider the statutory claims. The statutory claims Three statutory regimes were invoked by the appellants: a regime which prohibited "unconscionable conduct" in connection with the supply of financial services, operated concurrently by s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) ("the 320 Mahony v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522 at 527; [1985] HCA 37. 321 (1854) 9 Ex 341 [156 ER 145]. 322 Biancalana, "Contractual Penalties in the King's Court 1260-1360", (2005) 64 Cambridge Law Journal 212 at 219-220. ASIC Act") and s 8 of the Fair Trading Act 1999 (Vic) ("the FTA"), until the latter was replaced by the Australian Consumer Law ("the ACL")323; a regime which regulated the provision of credit and allowed for the reopening of "unjust including "unconscionable, harsh or oppressive") under s 76 of the National Credit Code, in force pursuant to the National Consumer Credit Protection Act 2009 (Cth); and term "unjust" transactions" (the a regime which rendered void "unfair" contractual terms pursuant to Pt 2B of the FTA and ss 12BF and 12BG of the ASIC Act. Each of the regimes did not apply throughout the whole of the period to which the statutory claims relate, and the regimes were subject to amendment. However, nothing turns on that fact. Some general observations by way of overview of the statutory claims will aid an understanding of what follows. First, as the primary judge noted324, there was no allegation of any dishonesty or abuse of market power by ANZ, or that ANZ concealed the requirements of the late payment fee from Mr Paciocco, or that he was unable to understand the effect of the contracts in that regard, or that he entered into the contracts as the result of the exercise of financial pressure placed upon him by ANZ. The primary judge also noted that Mr Paciocco was under no obligation to use the card accounts and was free to terminate them should he so choose325. Importantly, the primary judge observed that326: "Mr Paciocco did not contend that there was anything unusual or exceptional in the manner in which the card accounts were entered into or in their terms. On the contrary, it was common ground that similar terms were offered by ANZ's competitors." (citations omitted) 323 Section 8 of the FTA was repealed on 1 July 2012 by s 233 of the Australian Consumer Law and Fair Trading Act 2012 (Vic). But at the relevant time, s 8 of the FTA was in terms materially similar to s 12CB of the ASIC Act. 324 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 325 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 326 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at Given that the appellants did not suggest that ANZ dealt with Mr Paciocco in any way less favourably than he would have been treated by any other supplier of credit card facilities, and in the absence of an allegation that the market in which this state of affairs prevailed was itself brought about by unlawful conduct, or an allegation that Mr Paciocco was driven to agree to ANZ's terms by financial pressures of which the bank was aware, the appellants' statutory claims take on an air of unreality. The appellants seek to stigmatise as unconscionable or unfair or unjust an activity in the marketplace in which nothing materially distinguishes the situation and conduct of either Mr Paciocco or ANZ from any of the other participants in that activity. It may be said that ANZ and its competitors have dealt "unconscionably" or "unfairly" or "unjustly" with all of their customers in that, in a careless or partisan use of language, all banks may be said to do so as a matter of course. But to argue that conduct by one participant in a market, which is an unremarkable example of conduct engaged in by all participants in that market, is unconscionable, or unjust or unfair, in breach of the statutory norms, without any suggestion that the market itself is unlawfully skewed, is something of a stretch. And the argument falls distinctly short of the mark in this particular case, given that there was no suggestion that Mr Paciocco was driven to seek the card accounts as a result of "pressure put upon [him] by [his] poverty"327, or that Mr Paciocco incurred the late payment fees as a result of financial difficulties which prevented him from making timely payment in accordance with his contractual obligations. As has been seen, Mr Paciocco chose to pay late, and thereby incur the late payment fee, as a matter of his own convenience. In these circumstances, it would have been surprising if either Court below had held that ANZ took advantage of Mr Paciocco in a way which would meet the statutory descriptions of "unconscionable conduct", "unjust transactions" or "unfair terms". Unconscionable conduct Allsop CJ rejected the "gravamen" of the appellants' attack on ANZ's conduct, which depended upon what was said to be the "huge disparity between the level of the fees and the costs [ANZ] sustained by the exception fee events."328 His Honour concluded that329: 327 O'Rorke v Bolingbroke (1877) 2 App Cas 814 at 822; Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447 at 474. 328 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at "In all the circumstances, in particular, the lack of any proven predation on the weak or poor, the lack of real vulnerability requiring protection, the lack of financial or personal compulsion or pressure to enter or maintain accounts, the clarity of disclosure, the lack of secrecy, trickery or dishonesty, and the ability of people to avoid the fees or terminate the accounts, I do not consider the conduct of ANZ to have been unconscionable. To do so would require the court to be a price regulator in banking business in connection with otherwise honestly carried on business in which high fees were extracted from customers." The appellants submitted that s 12CB of the ASIC Act was introduced to address "the general disparity of bargaining power"330 between financial services providers and consumers. That submission may be accepted as far as it goes; but it does not go very far. While a disparity in bargaining power may be necessary to attract the operation of the provision, the mere existence of the disparity is not sufficient to do so. The existence of a disparity in bargaining power, which is an all-pervading feature of a capitalist economy, does not establish that the party which enjoys the superior power acts unconscionably by exercising it. In this latter regard, s 12CB of the ASIC Act, as in force immediately prior to 1 January 2012, relevantly provided: "(1) A person must not, in trade or commerce, in connection with the supply or possible supply of financial services to a person, engage in conduct that is, in all the circumstances, unconscionable. (2) Without limiting the matters to which the court may have regard for the purpose of determining whether a person (the supplier) has contravened subsection (1) in connection with the supply or possible supply of services to a person (the consumer), the court may have regard to: the relative strengths of the bargaining positions of the supplier and the consumer; and (b) whether, as a result of conduct engaged in by the supplier, the consumer was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the supplier; and 329 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 330 Trade Practices Act Review Committee, Report to the Minister for Business and Consumer Affairs, (1976) at 67 [9.59]. (c) whether the consumer was able to understand any documents relating to the supply or possible supply of the services; and (d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the consumer or a person acting on behalf of the consumer by the supplier or a person acting on behalf of the supplier in relation to the supply or possible supply of the services; and the amount for which, and the circumstances under which, the consumer could have acquired identical or equivalent services from a person other than the supplier. For the purpose of determining whether a person has contravened subsection (1) in connection with the supply or possible supply of financial services to another person: the court must not have regard to any circumstances that were not reasonably foreseeable at the time of the alleged contravention; and the court may have regard to conduct engaged in, or circumstances existing, before the commencement of this section." The appellants' argument focused upon s 12CB(2)(a) and (b) of the ASIC Act without regard to the other provisions which may be relevant. The argument that the Full Court should have concluded that the fee was unconscionable on the basis that it was not set at an amount limited to cost recovery only must be rejected because of its erroneously narrow assumption as to the legitimate interests of ANZ. Further, to focus upon the relative strengths of the bargaining positions of Mr Paciocco and ANZ is to ignore the requirement of s 12CB(1) to consider "all the circumstances". Section 12CB(1) does not proscribe the existence of a disparity in bargaining power as opposed to the manner of its exercise. And, as has been noted, nothing in the manner of ANZ's exercise of its superior bargaining strength fell foul of the other provisions of s 12CB(2). Unjust transactions and unfair contract terms The appellants argued that the late payment fees were unjust under s 76 of the National Credit Code331. Section 76(1) of the National Credit Code provides: "The court may, if satisfied on the application of a debtor, mortgagor or guarantor that, in the circumstances relating to the relevant credit contract, mortgage or guarantee at the time it was entered into or changed (whether or not by agreement), the contract, mortgage or guarantee or change was unjust, reopen the transaction that gave rise to the contract, mortgage or guarantee or change." Section 76(2) provides that, in determining whether a term is unjust, the court must have regard to the public interest and to all the circumstances of the case. Section 76(2)(a) to (p) also provide that the court may have regard to a range of matters, that including "any … relevant factor", determination. A close reading of s 76(2) of the National Credit Code reveals significant overlap between that sub-section and s 12CB(2) of the ASIC Act. in making In such circumstances, the appellants' focus upon s 76(2)(e) of the National Credit Code was once again too narrow. Section 76(2)(e) provides that the court may have regard to: "whether or not any of the provisions of the contract, mortgage or guarantee impose conditions that are unreasonably difficult to comply with, or not reasonably necessary for the protection of the legitimate interests of a party to the contract, mortgage or guarantee". As has already been noted, reliance on this sub-section reflected the appellants' misapprehension of the legitimate interests that ANZ was entitled to protect. The appellants also argued that the late payment fees were unfair contract terms within the meaning of ss 32W and 32X of the FTA and s 12BG of the ASIC Act. At the relevant time, s 32W of the FTA provided332: "A term in a consumer contract is to be regarded as unfair if, in all the circumstances, it causes a significant imbalance in the parties' rights and obligations arising under the contract to the detriment of the consumer." 331 Schedule 1 to the National Consumer Credit Protection Act 2009 (Cth). 332 Section 12BG of the ASIC Act was to the same effect. Section 32X of the FTA set out matters which could be taken into account by the court in determining whether a term of a consumer contract was unfair. The Full Court held that the late payment fees were neither "unjust" nor "unfair". Having already considered all of the circumstances at the time of Mr Paciocco's entry into the credit card contracts, and the effects of the terms of those contracts, the reasons of the Full Court in this respect were unsurprisingly "Considering the terms of s 32W of the [FTA], at the time of entry into the arrangements, did the provisions in question cause an imbalance in the parties' rights and obligations to the detriment of the consumer? It is difficult to see why this would be so by reference to the matters in s 32X or otherwise. The provisions were clearly disclosed. In most instances, the fees could be avoided. No trickery took place. Although set by the bank in contracts of adhesion, the contracts were terminable at the will of the customer; and the fee could be avoided by the conduct of the customer that was not unreasonable – keeping to her or his contractual limits." His Honour concluded that334: "Neither the relevant provisions of the [FTA] nor of the National Credit Code exhibit the intention that the Court should assume the role of a price regulator. It is unjustness or unfairness of transactions or terms that is required to be demonstrated. Price may affect such an evaluation but it does not determine it." That conclusion is correct: to conclude otherwise would be to give the consideration of price a decisive effect which it is not given by the legislation. In this Court, the appellants argued that the late payment fees caused a significant imbalance in the parties' rights and obligations to the detriment of the customer. The requirement of s 32W that the term be "to the detriment of the consumer" was not satisfied because the late payment fee was not a detriment to Mr Paciocco. As has been seen, it was an expense which he chose to risk as more convenient to him than paying his account on time. 333 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 334 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at Conclusion Both appeals should be dismissed with costs. Nettle 306 NETTLE J. These are appeals from a judgment of the Full Court of the Federal Court of Australia (Allsop CJ, Besanko and Middleton JJ)335. Essentially, they raise two questions. The first is whether a credit card facility late payment fee imposed by the respondent ("the Bank") was a penalty and, therefore, unenforceable. The primary judge (Gordon J) held that it was336. On appeal, the Full Court held that it was not established that the late payment fee was a penalty because it was not shown that it was "extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved" to have followed from late payment337. The second question is whether the imposition of the late payment fee was "unconscionable conduct" within the meaning of s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) ("the ASIC Act"), an "unjust transaction" within the meaning of s 76 of the National Credit Code in Sched 1 to the National Consumer Credit Protection Act 2009 (Cth) or an "unfair" contractual term within the meaning of Pt 2B of the Fair Trading Act 1999 (Vic) ("the FTA"). The primary judge did not deal with that question but the Full Court held that none of those provisions applied. The credit card facilities The first appellant, Mr Paciocco, had two credit card facilities. The first was a Low Rate MasterCard Account which was opened in June 2006 with a limit of $15,000 that was increased to $18,000 in November 2009. The second was a Low Rate MasterCard Account which was opened in July 2009 with a credit limit of $4,000. Each credit card facility was entered into on terms set out in the Bank's standard form terms of credit card facility and the Bank's bargaining power was such that Mr Paciocco had no opportunity to negotiate the terms. In effect, it was a case of take it or leave it, although there was no suggestion of the Bank imposing any unfair pressure, undue influence or unfair tactics to cause Mr Paciocco to enter into the facilities, and it was accepted that Mr Paciocco understood the nature of the terms and conditions of the facilities and had a real choice as to whether to enter into the facilities and to make use of them. The terms of each credit card facility included terms as to minimum monthly payments and late payment fees that were comprised in a Letter of 335 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199. 336 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249. 337 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 at 87 per Lord Dunedin. Nettle Offer, an "ANZ Credit Card Conditions of Use" document and an "ANZ Personal Banking Account Fees and Charges" booklet. In substance, they provided that a late payment fee would be charged upon failure to pay a minimum monthly payment and any amount due immediately (together, "the Monthly Payments") by a specified due date. For example, in June 2006, the Letter of Offer relevantly provided: "Minimum Repayment Each month you are required to pay: the greater of $10 or 2% of the monthly Closing Balance shown on your statement of account, rounded up to the nearest dollar or, if the Closing Balance of your statement of account is less than $10, the full closing balance by the Due Date shown on that statement of account. In addition you will need to pay any Amount Due Immediately on receipt of your statement of account. Credit Fees and Charges Late Payment Fee: A fee of $35 will be charged to your credit card account if the 'Monthly Payment' plus any 'Amount Due Immediately' shown on the statement of account is not paid within 28 days of the end of the 'Statement Period' shown on that statement." In December 2009, the quantum of the late payment fee was reduced from $35 to $20 but, in substance, the terms that provided for the late payment fee in the relevant 2009 contractual documents remained otherwise the same. Twenty-six late payment fees were charged to Mr Paciocco's accounts: eight in the period up to December 2009 and a further 18 after that. The Monthly Payments that were not paid on time and so resulted in late payment fees ranged between $10 and $750. The delay between the due date and the date on which those Monthly Payments were made ranged from five days to just over 30 days. The proceedings below At trial, Mr Paciocco and the Bank each called an expert witness to quantify the Bank's losses arising from Mr Paciocco's failure to pay the Monthly Payments by the due date. Each expert was, however, asked a different question. Mr Paciocco engaged Mr Regan, a certified public accountant, to identify the Nettle amounts needed to restore the Bank to the position in which it would have been if Mr Paciocco had not failed to pay the Monthly Payments by the due date. The Bank engaged Mr Inglis, a chartered accountant, to conjecture an array of costs which were not actually incurred by the Bank but which the Bank contended could have been conceived of at the time of entry into each credit card facility as potentially capable of arising from a failure to pay the Monthly Payments by the due date. Unsurprisingly, the calculations of each expert produced different results. Mr Regan found that the Bank incurred costs of no more than $3.94 on each occasion that Mr Paciocco failed to pay the Monthly Payments by the due date. In contrast, Mr Inglis conjectured that the maximum amount of costs which could have been conceived of at the time of entry into each credit card facility as potentially capable of arising from Mr Paciocco's failure to pay the Monthly Payments by the due date ranged between $5 and $147. The principal reason for that difference was that Mr Inglis included what he described as estimates of the following three categories of costs: increase in provision for bad or doubtful debts; increase in regulatory capital; and operational costs including certain costs associated with collecting amounts owed by customers ("collection costs"). The primary judge accepted Mr Regan's figures and rejected Mr Inglis' estimates as irrelevant. Her Honour held that each late payment fee was payable upon breach of a contractual obligation to pay the Monthly Payments by the due date and that, because the amount of the late payment fee very substantially exceeded the amount of damages that could be awarded for the breach of the obligation to pay the Monthly Payments by the due date, the late payment fee was extravagant and unconscionable in comparison with the greatest loss that could reasonably be proved. It followed, as her Honour held, that the late payment fee was a penalty. The Full Court adopted a test of whether the agreed sum was commensurate with the interest protected by the bargain. Allsop CJ, with whom the other members of the Court agreed, said that, although that test is "not ... unconnected with recoverable damages", the question is to be determined by reference to "the obligee's interest in the due performance of the obligation"338 and that that "is different from working out what damage can be proved from a 338 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at Nettle particular breach after the event"339. His Honour reasoned that it was "open ... to take into account the fact that one stipulation could be broken in countless ways, many (and likely most) trivial in consequence and some serious"340. It followed, in his Honour's view, that, despite the small amount of costs actually incurred by the Bank as a result of late payment by Mr Paciocco, and the very small amount that would have been recoverable as damages for breach of the Monthly Payments obligation, the range of costs which it was conceivable at the time of entry into the credit card facilities could be incurred as a result of a late payment was very much broader than the costs actually incurred. On that basis, the Full Court rejected Mr Regan's figures as irrelevant and accepted Mr Inglis' projections as demonstrating that, as at the time of the establishment of each credit card facility, it was objectively conceivable that failure by Mr Paciocco to pay the Monthly Payments by the due date could result in losses of up to $147 by way of an increase in provision for bad or doubtful debts, an increase in regulatory capital and collection costs. Thus, the Full Court held that it was not demonstrated that the late payment fee was a penalty. Tests for the identification of a penalty In Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd341, Lord Dunedin identified four tests (of which the fourth is comprised of four parts) ("the Dunlop tests") which his Lordship said may assist in deciding, and in some cases may determine, whether an obligation to pay a sum of money upon a breach of a contract is penal. In substance, those tests are: (1) whether the contract describes the payment as a penalty or liquidated damages is not decisive; the essence of a penalty is a payment "in terrorem" (which in this context means to deter the offending party from committing the breach), whereas the essence of liquidated damages is a genuine pre-estimate of damage; the question is one of "construction" (more accurately, of characterisation) of the terms of the contract having regard to the inherent circumstances of the contract at the time the contract was made; 339 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 340 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 341 [1915] AC 79 at 86-88. Nettle (4)(a) the agreed sum will be held to be a penalty if it is extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to have followed from the breach; (4)(b) the agreed sum may be held to be a penalty where the breach consists only in not paying a sum of money and the stipulated sum is greater than the sum which ought to have been paid; (4)(c) there is a presumption that a single lump sum is a penalty if it is payable on the occurrence of one or more of several events of which some may occasion serious damage and others do not; and (4)(d) where the consequences of breach make the precise pre-estimate of damage almost impossible, it is more probable that an agreed sum is a penalty than where the damage is capable of precise estimation. As Lord Dunedin made plain in Dunlop, the Dunlop tests are not rules of law and they are not exhaustive. Rather, they represent the distillation of various processes of reasoning that were applied in the several authorities from which the tests were derived and hence are conceived of as likely to prove useful and sometimes determinative in similar cases. Nevertheless, because of the broad range of cases from which the Dunlop tests were derived, and consequently the broad spread of cases to which they are capable of application, they have proved to be of widespread and enduring utility. The Dunlop tests have been applied by this Court on a number of occasions spanning many years342. Recently, in Ringrow Pty Ltd v BP Australia Pty Ltd343, this Court re-articulated the orthodox application of the Dunlop tests, that a penalty is "out of all proportion"344 to the 342 See, eg, Heron v Port Huon Fruitgrowers' Co-operative Association Ltd (1922) 30 CLR 315 at 323 per Knox CJ, Gavan Duffy and Starke JJ; [1922] HCA 20; Forestry Commission of NSW v Stefanetto (1976) 133 CLR 507 at 519 per Mason J; [1976] HCA 3; O'Dea v Allstates Leasing System (WA) Pty Ltd (1983) 152 CLR 359 at 368 per Gibbs CJ, 378 per Wilson J, 399-400 per Deane J; [1983] HCA 3; Acron Pacific Ltd v Offshore Oil NL (1985) 157 CLR 514 at 520 per Deane J; (1986) 162 CLR 170 at 190 per Mason and Wilson JJ; [1986] HCA 63; Esanda Finance Corporation Ltd v Plessnig (1989) 166 CLR 131 at 139-140 per Wilson and Toohey JJ, 143-145 per Brennan J; [1989] HCA 7; Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 at 662-663 [11]-[12]; [2005] HCA 71. [1985] HCA 63; AMEV-UDC Finance Ltd 343 (2005) 224 CLR 656. 344 Ringrow (2005) 224 CLR 656 [27] quoting AMEV-UDC (1986) 162 CLR 170 at 190 per Mason and Wilson JJ. Nettle "greatest loss that could conceivably be proved to have followed from the breach"345. By contrast, in Andrews v Australia and New Zealand Banking Group Ltd346, it was observed that the critical issue determined in Dunlop was broader: "whether the sum agreed was commensurate with the interest protected by the bargain". Similarly, in Cavendish Square Holding BV v Makdessi347, the Supreme Court of the United Kingdom posed the question in terms of "whether [the sum agreed] is ... out of all proportion to any legitimate interest of the innocent party in the enforcement of the primary obligation". At first sight, the formulations propounded in Andrews and Cavendish might appear to have departed from the Dunlop conception of being "out of all proportion"348 to the greatest conceivable loss flowing from the breach. Closer examination shows, however, that the Andrews and Cavendish formulations accord with Dunlop. Asking whether the sum agreed is out of all proportion to any legitimate interest of the innocent party in the enforcement of the primary obligation reprises the test formulated by Lord Robertson in Clydebank Engineering and Shipbuilding Company v Yzquierdo y Castaneda349 (on which the Dunlop tests were in part based) for application to a case where the damage suffered by the innocent party as a result of a breach is incapable of precise or even approximate quantification. The Andrews350 description of Dunlop, as being concerned with whether the sum agreed was commensurate with the interest protected by the bargain, was part of the Court's consideration of cases in which damage is incapable of even approximate quantification. Nothing said in Andrews runs counter to the approach adopted in Ringrow351 that "[i]n typical penalty cases, the court compares what would be recoverable as unliquidated damages with the sum of money stipulated as payable on breach". 345 Dunlop [1915] AC 79 at 87. 346 (2012) 247 CLR 205 at 236 [75]; [2012] HCA 30. 347 [2015] 3 WLR 1373 at 1392 [32] per Lords Neuberger of Abbotsbury PSC and Sumption JSC; [2016] 2 All ER 519 at 538. 348 Ringrow (2005) 224 CLR 656 [27] quoting AMEV-UDC (1986) 162 CLR 170 at 190 per Mason and Wilson JJ. 349 [1905] AC 6 at 20. 350 (2012) 247 CLR 205 at 236 [75]. 351 (2005) 224 CLR 656 at 665 [21]. Nettle Similarly, as Lords Neuberger and Sumption observed in Cavendish352, to pose the test in terms of whether the sum agreed is commensurate with the interest protected by the bargain reflects the way in which a number of English judges in recent times have approached cases involving more complex considerations than arise out of straightforward damages clauses in consumer contracts. But, as their Lordships emphasised, ordinarily the only legitimate interest of an innocent party in the performance of a primary obligation is in its performance or in some appropriate alternative to performance353. Hence, in the case of a "straightforward damages clause"354 the innocent party's interest will rarely extend beyond compensation for the breach and, therefore, in such a case, it is to be expected that the Dunlop tests will usually be "perfectly adequate"355 to determine whether a provision is a penalty. Are the Dunlop tests adequate in this case? As will be apparent from the differences between the approach of the primary judge and the reasoning of the Full Court, the outcome of the penalty appeal turns to a large extent on whether this case should be regarded as one of the straightforward kind in which the Dunlop tests are "perfectly adequate"356 to resolve the issues or whether it should be seen as one of the more complex types of cases referred to in Cavendish which necessitate considerations beyond a comparison of the agreed sum and the amount of recoverable damages. In particular, should the Bank be conceived of as having had a legitimate interest in Mr Paciocco's performance of the Monthly Payments obligation which extended beyond its performance or compensation for breach of its performance? Prima facie, where a bargain is for the provision of a credit card facility made available at an agreed rate of interest, the lender's only legitimate interest in 352 [2015] 3 WLR 1373 at 1389-1390 [25]-[28]; [2016] 2 All ER 519 at 535-536 referring to Lordsvale Finance Plc v Bank of Zambia [1996] QB 752 at 763-764 per Colman J; Cine Bes Filmcilik ve Yapimcilik v United International Pictures [2004] 1 CLC 401 at 409 [13] per Mance LJ; [2003] EWCA Civ 1669; Murray v Leisureplay per Arden LJ; [2005] EWCA Civ 963. IRLR 946 plc 353 Cavendish [2015] 3 WLR 1373 at 1392 [32]; [2016] 2 All ER 519 at 538. 354 Cavendish [2015] 3 WLR 1373 at 1392 [32]; [2016] 2 All ER 519 at 538. 355 Cavendish [2015] 3 WLR 1373 at 1389 [25], 1393 [32], see also at 1387 [22]; [2016] 2 All ER 519 at 535, 538, see also at 533. 356 Cavendish [2015] 3 WLR 1373 at 1389 [25], 1393 [32]; [2016] 2 All ER 519 at Nettle the enforcement of the primary obligation is repayment of the facility with interest at the agreed rate plus adequate recoupment of any costs imposed on the lender as a result of the customer's failure to adhere to the terms of the facility. Other things being equal, the lender's interest to be protected by the bargain does not extend to the payment of a liquidated sum that is disproportionate to any amount of additional costs imposed on the lender by reason of the breach or which could have been conceived of at the time of entry into the contract as a cost which would be incurred as a result of the breach. Of course, there are exceptions. In some cases, there may be evidence or other indications of some broader interest to be protected. Cases such as Clydebank, Dunlop and, to some degree, ParkingEye Ltd v Beavis357 serve as examples. But, for reasons which will be explained, in this case, there is no evidence or other indication of any interest to be protected by the timeous performance of the Monthly Payments obligation apart from the avoidance of costs. In Dunlop, the evidence given by the appellant's manager established that the payment in question was calculated to protect Dunlop's pricing structure, and thus goodwill, albeit that it was impossible to quantify the damage to its pricing structure or goodwill other than to say that it was potentially very substantial. In Clydebank, the losses caused by delay were not susceptible to monetary quantification given that the nature of the contract was to construct warships for Spain. In ParkingEye, it was an agreed fact that the object of an increased parking fee which was charged once a car remained parked for longer than a specified time was to ensure that other members of the public would be able to use the available car spaces. It was accepted that the fee charged for customers for staying longer than a specified time (although being several times the standard parking rate) was no higher than was necessary to achieve the objective of enabling other members of the public to use the available car parking spaces. In contrast here, as has been seen, the only evidence offered in support of the late payment fee was Mr Inglis' projections as to what he termed the greatest amount of costs which could conceivably have been, but which were not in fact, incurred. On the available evidence, including any inferences which might legitimately be drawn from the fact that the late payment fee was imposed by a bank, and that there were a very large number of customers of the Bank with similar credit card facilities, the only interest which it might reasonably be supposed the Bank had in the timeous performance of the Monthly Payments obligation was the avoidance of the costs in fact incurred or the costs which the parties could reasonably have conceived at the time of entry into the contract would flow from late payment. 357 Reported with Cavendish [2015] 3 WLR 1373; [2016] 2 All ER 519. Nettle Counsel for the Bank contended that it could be assumed that the Bank had an interest in keeping its cost of funds to a minimum and therefore that the late payment fee was calculated to ensure a degree of compliance with the Monthly Payments obligation resulting in a risk profile of the Bank's credit card account assets which optimised the Bank's cost of funds. In short, it was contended that riskier credit self-evidently is more costly credit. That contention is not persuasive. There was no evidence of how much greater the cost of funds might be and, in the absence of evidence, as Mr Regan observed, it is equally probable that the likelihood of default in performance of the obligation to make Monthly Payments was already priced into the relatively high rates of interest charged on credit card facilities358. There is, moreover, no apparent correlation between the amount of the late payment fee and the amount and duration of lateness of the Monthly Payments; and, in that critical respect, the late payment fee is the antithesis of the kind of interest rate increase which Colman J concluded in Lordsvale Finance Plc v Bank of Zambia359 could be justified on the basis that riskier credit is more costly credit. Counsel for the Bank also submitted that the late payment fee could be viewed as a "non-punitive" financial incentive, set by the Bank in the context of a competitive banking market, of which the objective purpose was to encourage customers to comply with the terms of their facilities as opposed to punishing them for failing to comply with those terms. That submission is equally unpersuasive. Whether the late payment fee is called an incentive or a punishment is beside the point. In effect, every penalty (or punishment) is an incentive even though not every incentive is a penalty360. As the law of penalties has evolved, however, it is not concerned with whether an obligation is properly to be conceived of as a punishment as such361. It is concerned with whether an obligation to make a payment on breach of a contractual or other principal obligation is of an amount which is grossly 358 The interest rate was 12.24% in 2006. 359 [1996] QB 752 at 763. 360 Cavendish [2015] 3 WLR 1373 at 1392 [31] per Lords Neuberger and Sumption; [2016] 2 All ER 519 at 537-538. 361 Bridge v Campbell Discount Co Ltd [1962] AC 600 at 622 per Lord Radcliffe; Esanda (1989) 166 CLR 131 at 138-139 per Wilson and Toohey JJ; cf Dunlop [1915] AC 79 at 86 per Lord Dunedin; Andrews (2012) 247 CLR 205 at 227-228 Nettle itself render sufficient disproportionate to the foreseeable consequences of the breach362. In effect, the gross disproportion the obligation "unconscionable" and therefore unenforceable. Accordingly, in England, and hitherto in this country, the main purpose of the law of penalties has been as a rule of law to prevent a party recovering a sum of money in respect of a breach of contract which bears little or no relationship to the loss actually suffered by that party363. And, similarly, in equity, as Mason and Wilson JJ observed in AMEV-UDC Finance Ltd v Austin364 (and as was later re-affirmed in Andrews365), "there seems to have been no instance of equity awarding compensation over and above the amount awarded as common law damages, other than cases in which equity would not relieve against the penalty". For the same reason, the fact that the late payment fee may have been set by reference to what other banks were charging in the context of a competitive banking market is essentially irrelevant. As Lords Neuberger and Sumption observed in Cavendish366, although the penalty rule originated out of equity's concern to prevent exploitation at a time when credit was scarce and borrowers were particularly vulnerable, the modern rule is substantive, not procedural. It does not normally depend for its operation on establishing that advantage was taken of one party. An obligation to pay a fee does not cease to be penal just because the obligee's competitors impose similar penalties on their customers. Where there is an incentive constituted of an obligation to pay a sum of money conditioned on a breach of contract of which is wholly disproportionate to the greatest costs which would have been conceived of at the time of entry into the contract, the obligation will be regarded as penal unless there be some aspect of the contract which makes it possible to say that the amount of the obligation is not wholly disproportionate to the interest protected by the bargain. the amount Nor does the fact that the late payment fee may have been set by reference to fees being charged by the Bank's competitors establish that the Bank had an interest in the timeous performance of the Monthly Payments obligation other 362 AMEV-UDC (1986) 162 CLR 170 at 190; Ringrow (2005) 224 CLR 656 at 363 Export Credits Guarantee Department v Universal Oil Products Co [1983] 1 WLR 399 at 403 per Lord Roskill; [1983] 2 All ER 205 at 224; Cavendish [2015] 3 WLR 1373 at 1384 [12] per Lords Neuberger and Sumption; [2016] 2 All ER 519 at 530. 364 (1986) 162 CLR 170 at 190. 365 (2012) 247 CLR 205 at 233 [65]. 366 [2015] 3 WLR 1373 at 1393 [34]; [2016] 2 All ER 519 at 538. Nettle than its performance or adequate compensation for its breach. Of itself, it suggests no more than that the extent of competition, or more likely lack of it, led the Bank to conclude that the level at which it set the fee was unlikely to result in an unacceptable loss of custom to other banks. That says nothing about whether this fee or those fees were penal in the relevant sense. In the result, although in some circumstances the test of whether a fee is a penalty may go beyond the quantitative assessment of disproportion between the fee and the greatest loss that could conceivably be proved, and if so may require a qualitative assessment of disproportion between the fee and a more imprecise conception of the interest protected by the bargain, in this case it is not possible to identify any interest to be protected by the bargain other than payment of the amount which was due together with compensation for such costs incurred as a result of late payment as would be recoverable as damages for breach of contract. That being so, to accept that the Bank was entitled to impose a late payment fee wholly disproportionate to the greatest loss that could conceivably be proved would be in effect to abandon a large part of the existing law relating to penalties. None of the authorities and nothing which was advanced in argument provides an acceptable basis for taking that step. There was and is no reason why the matter should not be determined in accordance with the Dunlop tests. Which Dunlop tests apply? Mr Paciocco claimed that the Full Court erred by applying test 4(a) of the Dunlop tests rather than test 4(b). Counsel for Mr Paciocco submitted that it was apparent from the terms of the Dunlop tests and a number of the cases in which they have since been applied that tests 4(a) and 4(b) are mutually exclusive in the sense that, where a breach of obligation consists only in failing to pay a sum of money and the stipulated sum is greater than the sum which ought to have been paid, test 4(b) applies to the exclusion of test 4(a). That argument should be rejected. As Lord Dunedin said in Dunlop367, although test 4(b) embodies one of the most ancient indicia of a penalty, it is but a corollary of test 4(a) and owes its existence to a time when the only available remedy for breach of obligation to pay a specified sum was recovery of the specified sum and perhaps interest. At that point in the law's development, it was not open to recover unliquidated damages for the consequences of failure to pay 367 [1915] AC 79 at 87. Nettle a specified sum of money or to pay it timeously368. It was for that reason, as Lord Parmoor observed in Dunlop, that369: "Since the damage for the breach of covenant is in such cases by English law capable of exact definition, the substitution of a larger sum as liquidated damages is regarded, not as a pre-estimate of damage, but as a penalty in the nature of a penal payment." Since then, the position has changed. Now it is possible to recover unliquidated damages for breach of an obligation to pay a specified sum and, accordingly, the amount recoverable for breach of such an obligation is no longer necessarily capable of exact pre-estimation370. There is no longer any reason in principle or policy why test 4(a) should be regarded as inapplicable to a failure to make a specified payment. As Lord Parmoor said, each case depends on its own facts and circumstances371. The better view of the operation of test 4(b) in contemporary circumstances is that it represents a possible, but not always necessary, application of the broader principle expressed in test 4(a) to facts of the kind identified in test 4(b). In any event, strictly speaking, this case is not of the type described in test 4(b). The late payment fee was payable on failure to make the Monthly Payments on time. The breach or failure of performance on which it was conditioned was lateness in payment as opposed to a failure to pay. Properly understood, as the primary judge held, this case fell within the general principle reflected in test 4(a) and therefore the applicable test was whether the late payment fee was exorbitant or extravagant (or, in other words, "out of all proportion"372) in comparison with the greatest loss that could conceivably be proved to have followed from the breach. Additionally, as the primary judge also held, this case engaged test 4(c) of the Dunlop tests. The late payment fee was of the same amount regardless of the magnitude of the Monthly Payments required to be made and of the extent of 368 See, eg, Kemble v Farren (1829) 6 Bing 141 at 148 per Tindal CJ [130 ER 1234 at 1237]; Reynolds v Bridge (1856) 6 El & Bl 528 at 541 per Coleridge J [119 ER 961 369 [1915] AC 79 at 101-102. 370 Hungerfords v Walker (1989) 171 CLR 125; [1989] HCA 8. 371 Dunlop [1915] AC 79 at 101. 372 Ringrow (2005) 224 CLR 656 at 667 [27] quoting AMEV-UDC (1986) 162 CLR 170 at 190 per Mason and Wilson JJ. Nettle lateness in payment, and thus, according to test 4(c), there arose an evidentiary presumption that the payment was penal. It then fell to the Bank to show why the late payment fee was not penal373. The greatest recoverable loss that could conceivably be proved Mr Paciocco further contended that, if test 4(a) of the Dunlop tests were applicable, the primary judge was correct to assess the greatest loss that could conceivably be proved to have followed from the breach by reference to what would be recoverable as unliquidated damages. For that reason, it was submitted, the Full Court erred in taking into account forms of projected losses which might be conceived of as bearing some possible relationship to the breach but which at law are regarded as too remote to be recoverable. That contention should be accepted. As Mason and Wilson JJ observed in AMEV-UDC374, during the first half-century following Dunlop the concept of an agreed sum being extravagant in comparison with the greatest amount of damage that could conceivably have been contemplated by the parties became, in effect, a test of whether the agreed sum was greater than the amount of damages that could be awarded for the breach of contract. That change was "consistent with an underlying policy of restricting the parties, in case of breach of contract, to the recovery of an amount of damages no greater than that for which the law provides"375. Hence, as stated in Chitty on Contracts376, the word "damage" in this context means "net loss" after taking account of the claimant's expected ability to mitigate. In AMEV-UDC377, Mason and Wilson JJ posited that it would be in the interests of freedom of contract, and therefore desirable, for the courts to return to the idea that an agreed sum should only be characterised as a penalty if it is "out of all proportion" to the damage likely to be suffered as a result of the breach. They proposed that the test be one of degree that depends on a number of circumstances including the degree of disproportion between the stipulated sum and the likely loss to be suffered (a factor which they said would be relevant to the oppressiveness of the term to the party required to pay) and the nature of the relationship between the contracting parties (a factor which they said would 373 See Lordsvale [1996] QB 752 at 761-764 per Colman J. 374 (1986) 162 CLR 170 at 190. 375 (1986) 162 CLR 170 at 190. 376 Chitty on Contracts, 32nd ed (2015), vol 1 at 1922 [26-187]. 377 (1986) 162 CLR 170 at 190. Nettle be relevant to the unconscionability of the party's conduct in seeking to enforce the term)378. It may be accepted that the law has now reached that stage of development. But, even so, as was stated in Ringrow379, in assessing the degree of disproportion in typical penalty cases the sum of money stipulated as payable on breach is to be compared with what would be recoverable as unliquidated damages for the breach. For the reasons already stated, this case is a typical penalty case of the kind referred to in Ringrow. In those circumstances, the primary judge was correct to consider whether the late payment fee was out of all proportion to the amount recoverable as unliquidated damages. Perspective for the assessment of loss The Full Court criticised the primary judge's approach to comparing actual damage suffered by the Bank with the late payment fee as an ex post determination of whether the prima facie penal character of the late payment fee was rebutted. According to the Full Court, what was required was an ex ante analysis (as at the date of entry into the credit card facility) to assess whether the fee was extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to follow from the breach. It followed, the Full Court held, that the primary judge was wrong to have regard to Mr Regan's evidence of costs actually incurred by the Bank on late payment by Mr Paciocco and wrong to reject Mr Inglis' projections as irrelevant. Contrary to the Full Court's reasoning, the primary judge did not take an ex post approach to the identification of conceivable loss. As her Honour's reasons make clear, she approached the task ex ante in accordance with Dunlop tests 4(a) and 4(c). By that means, she discerned that, because the late payment fee was of a fixed amount regardless of the magnitude and duration of the late payment, there was no ex facie relationship between the amount of the fee and any loss resulting from the lateness of payment. That gave rise to an evidentiary presumption that the late payment fee was penal. Then, in order to determine whether that presumption was rebutted380, her Honour embarked upon a comparison of the amount of the late payment fee with the amount which would be recoverable as unliquidated damages for breach of contract. The primary judge was also not in error in having regard to Mr Regan's evidence of actual damage. Although the exercise is one of characterisation and 378 AMEV-UDC (1986) 162 CLR 170 at 193. 379 (2005) 224 CLR 656 at 665 [21]. 380 See, eg, Lordsvale [1996] QB 752 at 761-764 per Colman J. Nettle therefore, as the Full Court said, looks forward ex ante from the time of entry into the contract, evidence of what happens after a contract is entered into is capable of providing a sound basis from which to infer what the parties would have reasonably expected to be the loss381. That is why, in the typical kinds of penalty cases to which this Court referred in Ringrow382, courts generally follow the approach of comparing what would be recoverable as unliquidated damages with the amount of the stipulated payment. For that purpose, courts may admit evidence to prove losses which may fairly and reasonably be considered to have arisen naturally according to the usual course of things so as to come within the first limb of Hadley v Baxendale383, and losses which, because of particular facts or circumstances known to the parties at the time of entry into the contract, may reasonably be conceived of as having been within the contemplation of both parties as the probable result of breach so as to come within the second limb384. As has been seen, it has only been in more complex cases of the kind considered in Clydebank, Dunlop and Cavendish, where the damage likely to result from a breach is not capable of precise pre-assessment, or cases like Cavendish and ParkingEye, where the interest of the innocent party in having the contract performed can be seen to extend beyond compensation for breach, that evidence has been admitted to prove what conceivably might have occurred even though it did not in fact occur385. Late payment fee is out of all proportion to recoverable damages The question then is whether the primary judge was correct in concluding that the amount of the late payment fee was extravagant and unconscionable or out of all proportion to the amount which would be recoverable as unliquidated damages for breach of the Monthly Payments provision. As was previously mentioned386, Dunlop test 4(c) recognises that the fact that a single lump sum is payable on the occurrence of one or more of several events of which some may occasion serious damage and others do not suggests 381 Philips Hong Kong Ltd v Attorney General of Hong Kong [1993] 1 HKLR 269 at 382 (2005) 224 CLR 656 at 665 [21]. 383 (1854) 9 Exch 341 [156 ER 145]. 384 Cf Robophone Facilities Ltd v Blank [1966] 1 WLR 1428 at 1448-1449 per Diplock LJ; [1966] 3 All ER 128 at 143-144. 385 Dunlop [1915] AC 79 at 91 per Lord Atkinson. 386 See above at [339]. Nettle that the obligation is a penalty. Similarly, the fact that the late payment fee in this case is a fixed fee regardless of whether the late payment is serious or trivial with respect to time or amount suggests that the late payment fee is a penalty. Hence, applying the Ringrow approach, the issue becomes one of whether there is any evidence or other compelling considerations sufficient to rebut the presumption to which that gives rise. As already noticed, the only evidence which the Bank put forward to support its contention that the late payment fee was not penal was Mr Inglis' projections of the costs of increase in provision for bad or doubtful debts, increased costs of regulatory capital and collection costs. The primary judge rejected those projections as irrelevant because, to a very large extent, no such costs were incurred. For the reasons which follow, her Honour was correct to do (i) Increase in provision for bad or doubtful debts The Bank uses provisioning to estimate the impairment of its financial assets. It is required to hold provisions for losses under both international and Australian accounting standards. One such standard, Australian Accounting Standards Board 139, was concerned with the measurement of a present or current loss, as opposed to estimates of future losses that might be expected or anticipated, in order to ensure that the financial statements present a fair value of what is likely to be collected from the Bank's receivables. Consistently with those standards, when accounting for a provision, two changes were reflected in the Bank's accounts. First, the amount owed by customers as recognised in the Bank's balance sheet was reduced to the level that the Bank expected to recover. Secondly, a loss was recorded in the Bank's profit and loss account as an expense or cost representing the impairment in the asset value. Given the nature of those entries, the primary judge held that the costs of increase in bad or doubtful debts which Mr Inglis attributed to each late payment were in effect no more than an estimate of possible future losses and so were not recoverable as damages for breach of contract. That conclusion was correct. A provision for bad or doubtful debts is an estimate of future loss, not an incurred loss. Perforce of the applicable accounting standards, the provision must be brought to account in the Bank's balance sheet as a credit against (and so in reduction of) the value of loans and other credit facilities the subject of provision. It must also be reflected in the Bank's profit and loss account as a credit against (and thus in reduction of) reported annual income. But, if the debt is recovered in a future year of income, the provision is or should be reduced accordingly and the reduction in provision should be carried to the profit and loss account as an accretion to the latter year's income. Most importantly, although the amount of an increase in provision for bad or doubtful debts is recorded as a once and for all expense against annual Nettle income for the year in which the provision is raised, it does not mean that the Bank has in fact received any less by way of income in that year or that it has had to pay away any of its income in satisfaction of a diminution in capital in that year. As the primary judge said, it is simply an estimate of what might or might not one day prove to be the case and therefore is not recoverable as damages. Conceivably, the Bank might suffer some detrimental consequence as a result of the reported reduction in asset value or annual income in the relevant year of income. At least in theory, either the reduction in asset value or the reduction in annual reported income could reduce the Bank's ability to borrow or lend money as part of its income producing activities. But the words "in theory" are stressed because, as Mr Regan suggested, in reality the Bank's generation of income from credit card facilities (and therefore at the very high rate of return which they generate) is as much dependent on lending to customers who it may be assumed will be late in making Monthly Payments as it is upon the state of its balance sheet and annual reported income. And, even if the Bank did suffer some reduction in its ability to borrow or lend money as a result of the increase in provision, the loss thereby occasioned to the Bank would certainly not be the amount of the increase in provision. It would be the present discounted value of the estimated reduction in income flowing from the restriction in borrowing or lending activities as a result of the increase in provision. Self-evidently, any such amount would be vastly less than the amount of the increase in provision. Furthermore, assuming that an increase in provision for bad or doubtful debts were recoverable as damages for breach of contract, it is apparent that the amount of the "costs" of increased provision that Mr Inglis attributed to late payment by Mr Paciocco was out of all proportion to any increase in provision which may have resulted from late payment. As appears from Mr Inglis' report, the Bank did not calculate provisions individually for each customer. Instead, it obtained approval from the Australian Prudential Regulation Authority to use an Internal Ratings-Based approach to credit risk which resulted in a Collective Provision for currently identified losses on pools of loans and other credit facilities that the Bank assessed to be at similar risk of defaulting in repayment. A provision was then calculated for the whole of each pool by means of the following formula: "Expected losses = PD [Predicted Default] x EAD [Exposure at Default] x LGD [Loss Given Default] x PCE [Potential Credit Exposure]". The Predicted Default figure was a statistical probability of an account in a pool of customer accounts with similar payment behaviours going into default over the following 12 months. That figure was multiplied by the Exposure at Default, which was a statistical estimate based on all current consumer credit Nettle accounts of the amount outstanding in the event a customer defaults. That figure was then multiplied by the Loss Given Default, the expected loss in the event of default, which was a statistic modelled across all consumer credit accounts. In turn, that amount was multiplied by the Potential Credit Exposure, which was the greater of the account limit or account balance where that amount might be assessed on an individual account basis but, for the purpose of at least some of Mr Inglis' calculations, where an "average exposure" was assumed. Given that, on the evidence, there were more than two million customer accounts in the pool, with credit limits ranging up to $500,000 per account, and therefore a total exposure of more than $19.4 million, and given that Mr Paciocco had only two facilities, of which the greater had a credit limit of less than $19,000, any amount by which late payment by Mr Paciocco caused the provision to be increased was necessarily minuscule in comparison to the total. In what was said to be an endeavour to provide an estimate of the portion of the increase in provision actually caused by each late payment by Mr Paciocco, Mr Inglis split the total population between customers who had made a late payment and those who had not. He then calculated a difference in "average" cost of provision for bad or doubtful debts per account (calculated across each group using the formula already described), of $23 per account (on his most conservative estimate). According to that analysis, the $23 was an "average" cost of increase in provision per late payment per account for each customer within the group of customers who made late payments, which was the cost to the Bank of each of Mr Paciocco's late payments. The problem with that, however, is that, due to the nature of the formula already described, and the fact that the "average" cost per late payment was calculated across the group of customers regardless of the amount of the individual facility limit or potential default of each customer, the $23 "average" cost per late payment was equally disproportionate to the extent to which each of Mr Paciocco's late payments added to the Bank's costs of increase in provision for bad or doubtful debts, and equally disproportionate to what the Bank and Mr Paciocco might be supposed to have contemplated at the time of entry into the facility as costs which could result from any of Mr Paciocco's late payments. (ii) Increase in regulatory capital As an authorised deposit-taking institution387, the Bank is required to maintain adequate capital, known as regulatory capital, to act as a buffer against unexpected losses388. The minimum amount of regulatory capital required to be 387 Pursuant to the Banking Act 1959 (Cth). 388 See Prudential Standard APS 110 (Cth). Nettle held is determined by measuring the Bank's overall capital base against its holdings of risk weighted assets ("RWA"). The more RWA the Bank holds, the greater the amount of regulatory capital it must put aside to counter the risk of default on those assets. The primary judge concluded that none of the alleged increases in regulatory capital could be directly or indirectly related to any of Mr Paciocco's late payments and, consequently, that the alleged cost of increase in regulatory capital should not be taken into account in the assessment of damages recoverable for breach of contract. That was also correct, although for partly different reasons from those which appealed to her Honour. According to his report, Mr Inglis' estimate of the "cost" of increase in regulatory capital consequent upon late payment was comprised of two elements: the "cost" of increase in RWA; and the cost of additional regulatory capital to replace Core Tier 1 capital the result of increase in RWA. The estimate of the "cost" of increase in regulatory capital consequent upon a late payment was between $9 and $12 per late payment. Mr Regan made a number of criticisms of the methodology of that estimate which, if accepted, would suggest it was significantly inflated. Over and above those criticisms, however, it is apparent that the "cost" of increase in regulatory capital as so estimated is no more than an estimate of increase in provision for RWA. It follows that, like the increase in provision for bad or doubtful debts389, it is not a loss or outgoing that would be recoverable as damages for breach of contract. It is merely an estimate of a cost which might one day be, but equally might not be, incurred. In contrast to the "cost" of increase in RWA, it appears that the cost of replacing Core Tier 1 capital might have been a loss or outgoing actually incurred, due to the need to supplement Tier 1 capital relegated to regulatory capital, and so might be recoverable as damages for breach of contract. But the amount of it was de minimis. Mr Inglis' estimation of the "average" costs of additional regulatory capital to replace the Core Tier 1 capital was between only $1 and $2 per late payment. Mr Inglis also proposed an alternative calculation, of between $5 and $6 per late payment, which he said he computed by excluding repayment events (that is, repayments and write-offs). But he did not offer any justification for 389 See above at [351]-[352]. Nettle excluding repayment events. Nor is there any reason in principle why repayment events should have been excluded. To the contrary, as Mr Inglis indeed explained, repayment events result in a reduction in the provision for RWA that reduces the need for regulatory capital and thus has an associated cost saving. Hence, to exclude repayment events from the calculation significantly distorts the estimate. (iii) Collection costs Late payment of amounts owing on a credit card account may trigger collections activity by the Bank to recover the amounts due, including by contacting overdue customers by telephone. Mr Inglis put forward two alternative estimates of collection costs caused by late payment of the Monthly Payments: Calculation A and Calculation B. In Calculation A, he conjectured that the "average" collection costs which could result from a late payment were only $4.90 and in Calculation B, he proposed a much higher figure of $15.70 per account. The method of calculation employed in Calculation B differed from the method used for the purposes of Calculation A (and, therefore, from the method used for all other calculations undertaken by Mr Inglis) in that it was made on what Mr Inglis termed a "per account" basis, as opposed to a per late payment basis, as was used for all other calculations. Since the late payment fee was chargeable on a per late payment basis, and since the question for present purposes is whether the late payment fee was out of all proportion to the costs which the Bank might conceivably incur as a result of the late payment, there is no acceptable justification for the adoption of the Calculation B methodology. Mr Inglis also provided a further alternative calculation which he called the "maximum amount of costs that the Bank could conceivably have incurred", which ranged between $44.90 and $99.20 per account. Those estimates were made on the basis of the 95th percentile of the total telephone call duration for each stage of collections activity. But there is even less justification for accepting an estimate of that kind than there is for adopting the per account basis employed in Calculation B. For even though it is open to take into account the fact that a stipulation may be broken in countless ways, and that although the majority of them are likely to be trivial some may be serious390, conjectured costs of between 10 and 20 times Mr Inglis' own, on any view, generous estimate391 of 390 Cf Cooden Engineering Co Ltd v Stanford [1953] 1 QB 86 at 98 per Somervell LJ, 108-109 per Jenkins LJ. 391 Mr Regan noted that the Bank incurred $9.6 million of collection costs for late payments in 2009. Multiplying Mr Inglis' "average" estimate of approximately $5 by the approximately 2.5 million late payments that occurred in 2009 would result (Footnote continues on next page) Nettle the increase in collection costs likely to be incurred on an "average" basis are not recoverable as damages for breach of contract and cannot otherwise realistically be regarded as anything like a reasonable estimate of the greatest conceivable loss likely to be incurred. As counsel for Mr Paciocco put it, such an estimate is untethered from reality. (iv) Total additional costs It follows from the foregoing that, so far as the evidence went, the maximum amount of additional costs resulting from a late payment that might conceivably have been recoverable as damages for breach of contract was $6.90 per late payment ($2 "average" cost of replacement of regulatory capital and $4.90 for "average" collection costs). And it follows from that that the late payment fee of $35 per late payment (or even $20 per late payment as it later became) was grossly disproportionate to the greatest amount of damages recoverable for breach of the Monthly Payments obligation. The late payment fee is a penalty As Mason and Wilson JJ proposed in AMEV-UDC392, the question of whether an obligation to make a specified payment conditioned on a breach of contract is penal is a question of degree which depends on a number of circumstances, including the degree of disproportion between the stipulated sum and the likely loss to be suffered and the nature of the relationship between the contracting parties. In this case, the contract is a standard-form consumer credit contract and the Bank's bargaining power was such that Mr Paciocco had no opportunity to negotiate the terms. That consumer relationship, combined with the fact that the late payment fee of $35 (or $20 as it later became) was extravagant or otherwise out of all proportion to the $6.90 of costs which might conceivably have been recoverable as damages for breach of contract, warranted the primary judge's conclusion that the late payment fee was a penalty. Notice of contention By a notice of contention, the Bank contended that Mr Paciocco's claim to recover a late payment fee incurred on 4 September 2006 is time-barred by the operation of the Limitation of Actions Act 1958 (Vic) ("the Limitation Act"). Given the way in which the majority of this Court has determined that the penalty appeal should be decided, it is perhaps unnecessary to consider whether, in collection costs of more than $12 million, far exceeding the $9.6 million actually incurred. 392 (1986) 162 CLR 170 at 193; see also Dunlop [1915] AC 79 at 86-87. Nettle if it were recoverable, the late payment fee incurred in 2006 would be time- barred. For completeness, however, it should be observed that, as finally put in argument, the sole basis of the contention was that the primary judge and the Full Court were in error in holding that s 27(c) of the Limitation Act is capable of application to a mistake of law. On that basis, the contention may be rejected. It is plain for the reasons essayed by the primary judge393, and more fully in the Full Court by Besanko J394, that s 27(c) of the Limitation Act, like s 26(c) of the Limitation Act 1939 (UK), on which it is based, is capable of applying to a mistake of law as much as to a mistake of fact. Statutory causes of action The hearing before the primary judge was conducted on the agreed basis that, if the judge determined that the late payment fee was penal, it would be unnecessary for her Honour to decide whether the imposition of the late payment fee was "unconscionable conduct" within the meaning of s 12CB of the ASIC Act, an "unjust transaction" within the meaning of s 76 of the National Credit Code or an "unfair" contractual term within the meaning of Pt 2B of the FTA. Accordingly, having held that the late payment fee was penal, the primary judge did not go on to consider whether the late payment fee was caught by any of those statutory provisions. Given that I have concluded that the primary judge was correct in holding that the late payment fee was penal, it is unnecessary for me to consider whether the late payment fee attracted any of those provisions. Conclusion and orders In the result, I would order that the appeal in M220 of 2015 be allowed with costs. The orders of the Full Court should be set aside and in lieu thereof it should be ordered that the appeal to the Full Court be dismissed and that the Bank pay the appellants' costs of the appeal. In M219 of 2015, which was in effect dependent on the outcome in M220 of 2015, it should be ordered that the appeal be dismissed without any adjudication upon the merits and that the appellants pay the Bank's costs of that appeal. 393 Paciocco v Australia and New Zealand Banking Group Ltd (2014) 309 ALR 249 at 394 Paciocco v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 199 at 291-295 [382]-[397] per Besanko J (Allsop CJ agreeing at 251 [192], Middleton J agreeing at 295 [398]).